OpenText to sell AMC business to Rocket Software for $2.275B; focuses on Cloud & AI

OPEN TEXT CORP

All-cash purchase price of $2.275B; 4.6x AMC's FY23 revenue (~$500M) and 8.3x Adjusted EBITDA (~$275M).
Transaction includes ~750 AMC employees; expected close by June 30, 2024, subject to regulatory approvals.
Net proceeds to reduce debt; OpenText targets under 3x Consolidated Net Leverage Ratio within 90 days of close.
Divestiture allows OpenText to focus on Cloud and AI opportunities in Information Management; potential future buybacks.
Goldman Sachs & Co. LLC is sole financial advisor; Cleary Gottlieb is legal advisor.

Key facts

Extracted from this filing and checked against the source text.

Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

OPEN TEXT CORP entered into Purchase Agreement with Rocket Software, Inc. valued at US$2.275 billion (effective 2023-11-28).

Action: entry
Agreement: asset purchase
Counterparty: Rocket Software, Inc.
Value: US$2.275 billion
Effective: 2023-11-28

Exact text from the filing

On November 28, 2023, Open Text Corporation (“OpenText” or the “Company”) entered into a Purchase Agreement (the “Agreement”) with Rocket Software, Inc. (the “Buyer”), pursuant to which OpenText has agreed to divest, directly and indirectly through certain subsidiaries, its Application Modernization and Connectivity business (the “Business”) and the Buyer has agreed to purchase the same and generally assume all liabilities related to the Business, subject to certain exceptions (such transactions collectively, the “Transaction”), for an all-cash purchase price of US$2.275 billion

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Source: SEC EDGAR

accession 0001002638-23-000035

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