OpenText to divest AMC business to Rocket Software for $2.275B in cash

Open Text announced that it has reached a definitive agreement to divest its AMC business to Rocket Software, a Bain Capital portfolio company, for $2.275B in cash. OpenText’s AMC business provides market leading mainframe modernization and connectivity software to more than 10,000 customers enabling them to run mission-critical business applications in hybrid cloud environments. About the Transaction: $2.275B all-cash purchase price before taxes and fees; Sale price of 4.6x AMC’s F’23 revenue of approximately $500M; Sale price of 8.3x AMC’s F’23 Adjusted EBITDA of approximately $275M; Net proceeds to reduce debt, to be applied to the Acquisition Term Loan and Term Loan B; Expect to close in OpenText’s fourth fiscal quarter ending June 30, 2024, subject to regulatory approvals and customary closing conditions. The combination of AMC and Rocket Software’s highly complementary product portfolios will create one of the world’s largest IT and mainframe modernization and connectivity software companies. Under the terms of the agreement, the software, associated services, and approximately 750 employees of AMC will be integrated into Rocket Software. Until closing, OpenText and Rocket Software will continue to constructively collaborate to protect customer investments and expand offerings for joint customers.