Rocket Software to Purchase OpenText’s AMC Business for Over $2 Billion

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Open ($NASDAQ:OTEX)Text Corporation, a global leader in enterprise information management (EIM), has announced that its partner, Rocket Software, is to purchase OpenText’s Application Management & Cloud Services (AMC) business for an estimated value of over $2 billion. This acquisition will bring Rocket Software, a leader in mobile, mainframe and analytics solutions, an extensive portfolio of application management solutions, cloud services and expertise in managed services. OpenText is a publicly-traded Canadian company that provides some of the world’s most advanced software solutions.

The company helps organizations find, use, and analyze their unstructured data, providing essential insights to help make better decisions faster. OpenText’s suite of products provides enterprise content management (ECM), customer experience management (CEM), business process management (BPM), analytics, and more.

Share Price

On Tuesday, Open Text Corporation announced they have agreed to be acquired by Rocket Software Inc. in a deal valued at over $2 billion. Upon the news, the stock price of Open Text opened at $39.8 and closed at $40.3, up by 1.4% from its previous closing price. The acquisition is seen as part of Rocket Software’s growth strategy, and it will give them access to hundreds of enterprise customers.

It will also give them the ability to expand their offering of enterprise solutions, particularly in the areas of application development and integration, modernization, and AI-driven automation. It is expected that this will be a game-changer for Rocket Software’s future success. Live Quote…

About the Company

Income Snapshot

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Cash Flow Snapshot

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Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Open Text. More…

Key Ratios Snapshot

Some of the financial key ratios for Open Text are shown below. More…

Analysis

GoodWhale has examined the financials of OPEN TEXT and, based on our Star Chart classification, we have concluded that it is a ‘gorilla’ – a type of company which has achieved stable and high revenue or earning growth due to its strong competitive advantage. This makes it an attractive option for investors seeking steady returns and an excellent long-term investment. In terms of its health score, we give OPEN TEXT an intermediate score of 6/10. This is because the company’s cashflows and debt are at a manageable level, allowing it to safely ride out any crisis without the risk of bankruptcy. The financials of OPEN TEXT also reveal that it is strong in asset, dividend, growth, and profitability. All these metrics show that OPEN TEXT is well positioned to remain competitive in the marketplace and generate steady returns for investors. More…

Summary

OpenText’s Acquisition Management Common Platform (AMC) business has been acquired by Rocket Software for over $2B. This investment is a strategic move, enabling Rocket Software to expand its offerings in the enterprise software and business process management space. With the acquisition, Rocket Software will gain access to OpenText’s AMC Platform’s features and capabilities, including enterprise content management, document workflow, document automation, and records management. This acquisition will provide Rocket Software with an opportunity to increase its reach to customers in different verticals such as banking, legal, aerospace, healthcare, and government.

Additionally, this acquisition will reduce the cost of ownership for customers and accelerate the time to value for OpenText’s AMC platform. The combined offering will be a valuable asset for organizations that are looking to automate and streamline their business processes in a secure fashion.