Red Hat mulls offers to relocate corporate HQ

Posted December 9, 2010

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— Red Hat has offers on the table from multiple cities and developers, including some who are willing to build a new office tower for the Raleigh-based company if it decides to move its corporate headquarters, according to multiple sources.

Raleigh faces keen competition for Red Hat, which sources said is looking for as much as 300,000 square feet of space. Red Hat currently occupies well under 200,000 square feet in two buildings on N.C. State’s Centennial Campus.

Given the size of the company’s request, developers “from Durham, the I-40 strip and in Raleigh” have offered packages that include construction of a building with Red Hat serving as the anchor tenant, sources said.

“It would be dynamite” for the winning developer and city, one executive said.

Another executive very familiar with the situation in Raleigh noted that a “number of cities” have made offers.

Jim Whitehurst, chief executive officer of the world’s top Linux open source software developer and services provider, declined comment Thursday morning.

“What are we saying now,” Whitehurst asked to his two media relations personnel. Then came the response:

“Red Hat is a healthy company. We are always planning for expansion and examining our best options. We have no additional comments at this time.”

Red Hat, a publicly traded company (NYSE: RHT), is set to announce its most recent quarterly earnings on Dec. 21. This year has been a record one for Red Hat in revenues and profits. Its stock is trading at 52-week highs, and its market value is above $8 billion.

Sources confirm that Red Hat solicited and received several specific proposals before Thanksgiving in response to a “request for information.” Red Hat has been reported to be actively looking at options for new space beyond the Triangle, including Boston, Atlanta and Austin, Texas.

Whitehurst, a former chief operating officer at Delta Airlines in Atlanta, recently toured the American Tobacco Historic District in Durham, which is owned by Capitol Broadcasting. Capitol is the parent company of WRAL-TV, and Local Tech Wire.

City of Raleigh officials are “totally engaged” in keeping Red Hat in Raleigh, said Harvey Schmitt, chief executive officer of the Greater Raleigh Chamber of Commerce.

Gov. Bev Perdue and the N.C. Department of Commerce are also involved in the negotiations, Schmitt added.

“We have put our best foot forward,” added Raleigh Mayor Charles Meeker. He said he remains “hopeful” that Raleigh will win the corporate recruiting battle.

One source said that NCSU representatives “keep asking” Red Hat for a timeline about its decision-making process but as of Tuesday had not been told anything specific.


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  • Commenter Dec 10, 2010

    Unless things have changed from the last time I knew the numbers, Centennial Campus is extremely expensive.

  • godnessgracious Dec 10, 2010

    When I used linux to hold me over till windows 7 came out, redhat was never any good on the desktop. Linux mint is where it was at. Used ubuntu primarily before I found mint though. And knoppix before that. Redhat makes thier money from the server side anyway, of which I have no frame of reference. I do hope they can keep them atleast in the triangle.

  • CarZin Dec 10, 2010

    "Why the double standard? I'm really confused. I thought you people had a platform. Apparently your only platform is, if a Democrat is giving someone something, it is bad even if it agrees with what I want. Pathetic."

    Exactly. I'm a republican, and I am embarrassed with most of the conversative posts on here. too many people dont have the brain power to process anything other than 'if the other side does it, it has to be wrong'. I have pointed out almost the exact thing you have done in the past, where these same people saying Bev shouldnt give local tax credits will state that taxing corporations (federal level) is tantamount to double taxation.

    I have long since given up hope that the vast majority of the citizens in this fine state can actually think for themselves. What is said, however, is sometimes the most empassioned people on this site have no clue...

  • Wacky_dood Dec 10, 2010

    Hey ProzacDispenser, didn't you get the memo--P/E isn't relevant anymore!
    A P/E of 60 for a company with no defendable patents is no problem. It's a momentum play! Get on the train before it leaves the station!

    Oh wait, that was the battle cry of the guys who drove up the stock of bogus companies during the dot con era.

    Never mind.

  • exposure102 Dec 10, 2010

    How about using some of that empty space over at IBM since they are determined to rid themselves of every liability, I mean American, on the payroll...lots of space in RTP.

  • JordanvsBird Dec 10, 2010

    I know, let's give them a billion dollar incentive package to stay. We can just tax all of the small businesses to pick up the tab.

  • LuvLivingInCary Dec 10, 2010

    this company is way over hyped. just like sirrius and xm.

    it's just a matter of time before the new wears off and it's a penny stock. come on. they compete with microsoft and apple and don't even compete well.

  • smcallah Dec 10, 2010

    Wow, you people really aren't making any sense.

    Most of you saying that Red Hat shouldn't be able to get a tax break to stay in Raleigh or NC are the same people that complain that Obama shouldn't let the tax cuts for the wealthy expire because then jobs won't be created.

    So you don't think a tax break would make Red Hat do that? Then why do you think tax breaks for the wealthy would do that?

    And the US has the highest corporate taxes in the world. Shouldn't you lower tax people be applauding the decision by NC to lower some of the taxes for a corporation?

    Why the double standard? I'm really confused. I thought you people had a platform. Apparently your only platform is, if a Democrat is giving someone something, it is bad even if it agrees with what I want. Pathetic.

  • NotFromHere Dec 10, 2010

    "Big corporations put the Repubs in power so as not to pay any taxes to any one." NYTONC

    An interesting fact came out in the last election. Only about 50% of corporations contribute to political parties or political action committees. But of that number, 80% of them give to BOTH parties. They want to be able to call in a favor not matter who wins.

    I remember them interviewing a black woman on CNN. She was a corporate board member who was volunteering for the Obama campaign. But she had made a sizable dollar contribution to the Republican Party. She may have wanted Obama to win, but she was hedging her bets in case he didn't.

  • itsmyownopinion Dec 10, 2010

    Most of you are clueless.