SUSE acquires Kubernetes startup Rancher Labs

The deal will enable SUSE customers to "seamlessly innovate across their business from the edge to the core to the cloud"

German-based Linux distribution company SUSE has announced plans to acquire Kubernetes management outfit Rancher Labs.

The price of the acquisition was not disclosed, but two people familiar with the deal told CNBC that SUSE is paying between $600 million to $700 million to buy the Cupertino-based startup.

Rancher Labs, which was was founded in 2014 and currently boasts more than 200 employees, provides open-source software that enables organizations to deploy and manage Kubernetes at scale.

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The startup, which has raised more than $95 million in funding, claims Rancher is the "most widely used enterprise Kubernetes platform" with more than 30,000 active users. Its big-name customers include the likes of American Express, Comcast, Deutsche Bahn and Viasat.

The deal, SUSE and Rancher Labs claim, will deliver computing everywhere with the latest AI and seamless deployment of containerized workloads from the edge to the core to the cloud.

“This is an incredible moment for our industry, as two open source leaders are joining forces. The merger of a leader in Enterprise Linux, Edge Computing and AI with a leader in Enterprise Kubernetes Management will disrupt the market to help customers accelerate their digital transformation journeys,” said Melissa Di Donato, CEO of SUSE.

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“Only the combination of SUSE and Rancher will have the depth of a globally supported and 100% true open source portfolio, including cloud-native technologies, to help our customers seamlessly innovate across their business from the edge to the core to the cloud.”

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Shen Liang, CEO of Rancher Labs, added that the merging of the two companies will "help organisations control their cloud native futures".

"Our leading Kubernetes platform with SUSE's broad open source software solutions creates a powerful combination, enabling IT and Operations leaders worldwide to best meet the needs of their customers wherever they are on their digital transformation journey from the data center to cloud to edge," he added.

The acquisition is expected to close before the end of October 2020, following regulatory approvals.

News of the takeover comes just weeks after Rancher Labs announced the launch of Rancher Academy, a new certification program that the firm says will address the growing Kubernetes skills gap.

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