The world’s leading provider of open source solutions – Red Hat – has announced the acquisition of Bangalore based cloud-computing start-up Gluster for a whopping Rs. 667 crore ($136 million) in an all-cash deal.

Gluster was established in 2005 by Anand Babu Periasamy and Hitesh Chellani with the aim of leveraging open source software and commodity hardware to offer enterprise customers with public and private cloud-based storage solutions. It has clients such as UK defence major BAE Systems, Stanford University, Deutche Bank and the administrative office of US courts.

It has developed an open-source platform technology for working with large amounts of data that can tie everything together from the operating system layer to the file system and management interface. Headquartered in Sunnyvale, California, the company has over 100 enterprise customers including Box.net, the personalized internet radio service Pandora among others.

Red Hat CTO Brian Stevens said “The explosion of big data and the new paradigm of cloud computing are converging, forcing IT to re-think storage investments that are cost-effective, manageable and scale for the future. Our customers are looking for software-based storage solutions that manage their file-based data on-premise, in the cloud and bridging between the two. With unstructured data growth (such as log files, virtual machines, email, audio, video and documents), the 90's paradigm of forcing everything into expensive, single-system DBMS residing on an internal corporate SAN has become unwieldy and impractical.”

"It was a struggle, but the journey was fun. A lot of people told us what we were doing was impossible and we were crazy. But great ideas are always controversial in the beginning," said AB Periasamy, also the CTO of Gluster. "With Red Hat's platform, we can now compete with the big boys." Periasamy will now work work along with Stevens.

Subject to customary conditions, the deal is expected to close this month