OpenText™ announced that it has closed the previously announced acquisition (the Acquisition) of Micro Focus International plc (Micro Focus), a provider of mission-critical software technology and services that help customers accelerate digital transformation.
What were the specifics of the transaction?
Preliminary Financial Overview
Further information on our financial performance, and updated models, were provided at OpenText’s second quarter Fiscal 2023 financial & business results on February 2, 2023.
Closing Terms of the Acquisition
- Total purchase price of approximately $5.8 billion, inclusive of Micro Focus’ cash and debt, subject to final adjustments
- Total purchase price is 2.3x Micro Focus’ TTM revenues(1)
- Total purchase price is 6.7x Micro Focus’ TTM adjusted EBITDA(2)
- Immediately accretive to F’23 adjusted EBITDA dollars
- Expected to be on the OpenText operating model within 6 full quarters or sooner
- Net leverage(3) expected to be less than 3x within 8 full quarters or sooner
- Consistent with previously announced cost synergies of $400 million, expect to balance the combined company through an approximate 8% workforce reduction due to the acquisition of Micro Focus
What does the acquisition mean for OpenText?
“I would like to welcome Micro Focus customers, partners and employees to OpenText. Digital life is life, and with Micro Focus’ great products and talent, we will help firms of all sizes accelerate their digital transformation,” said OpenText CEO and CTO Mark J. Barrenechea.
“With this acquisition, OpenText’s corporate mission expands to help enterprise professionals secure their operations, gain more insight into their data, and better manage an increasingly hybrid and complex digital fabric with a new generation of tools that include Cybersecurity, Digital Operations Management, Applications Modernisation & Delivery and AI & Analytics.”
This new generation of Information Management software will help organisations accelerate their digital transformation and drive growth while reducing costs,” Barrenechea added.
“We have a structured and disciplined approach to mergers and associations. The last six months of planning has led us to a defined integration plan to deliver on our committed outcomes. We are excited about winning the Information Management market, strong client outcomes, and company growth and expanded cash flows,” concluded Barrenechea.
