OpenText to Acquire Micro Focus in Watershed Deal

OpenText announced it has reached an agreement to acquire Micro Focus, implying an enterprise value of approximately $6.0 billion on a fully diluted basis. This merger would create one of the largest software and cloud businesses that enables digital transformations.

"We are pleased to announce our firm intention to acquire Micro Focus, and I look forward to welcoming Micro Focus customers, partners and employees to OpenText," said OpenText CEO and CTO Mark J. Barrenechea. "Upon completion of the acquisition, OpenText will be one of the world's largest software and cloud businesses with a tremendous marquee customer base, global scale and comprehensive go-to-market. Customers of OpenText and Micro Focus will benefit from a partner that can even more effectively help them accelerate their digital transformation efforts by unlocking the full value of their information assets and core systems."

Micro Focus is one of the world's largest software companies and serves thousands of organizations globally, including many of the largest companies in the Fortune Global 500 and had approximately $2.7 billion pro forma trailing twelve months (TTM) revenue for the period ended April 30, 2022.

OpenText values Micro Focus' strong brands and culture and attaches great importance to the skill and experience of Micro Focus' management team and employees, according to the company.

The total purchase price of the deal is $6.0 billion, inclusive of Micro Focus' cash and debt. The expected cost synergies are $400 million, including Micro Focus' previously announced cost savings program of $300 million (net of inflation), as well as $100 million in additional cost synergies.

The Acquisition is expected to close in the first quarter of calendar 2023, subject to the satisfaction (or, where applicable, waiver) of the conditions set out in Appendix 1 to the Announcement.

Barclays Bank PLC is serving as sole financial advisor to OpenText. Allen & Overy LLP and Cleary Gottlieb Steen & Hamilton LLP are acting as legal advisors to OpenText.

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