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`OpenText Buys Micro Focus
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`Content
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`Financials
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`Corporate
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`Waterloo, ON – 2023-01-31 –
`
`OpenText™ (NASDAQ: OTEX), (TSX: OTEX) announced today that it has closed the previously announced
`acquisition (the “Acquisition”) of Micro Focus International plc (“Micro Focus”), a leading provider of mission-critical
`software technology and services that help customers accelerate digital transformation. 
`
`“I would like to welcome Micro Focus customers, partners and employees to OpenText,” said OpenText CEO & CTO
`Mark J. Barrenechea. “Digital life is life, and with Micro Focus’ great products and talent, we will help organizations
`of all sizes accelerate their digital transformation.”
`
`Barrenechea further added, “With this acquisition, OpenText’s corporate mission expands to help enterprise
`professionals secure their operations, gain more insight into their information, and better manage an increasingly
`hybrid and complex digital fabric with a new generation of tools that include Cybersecurity, Digital Operations
`Management, Applications Modernization & Delivery and AI & Analytics. This new generation of Information
`Management software will help organizations accelerate their digital transformation and drive growth while
`reducing costs.”
`
`Preliminary Financial Overview
`
`Further information on our financial performance, as well as updated models, will be provided when OpenText
`reports its 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
`(1)
`Total purchase price is 2.3x Micro Focus’ TTM revenues
`(2)
`Total purchase price is 6.7x Micro Focus’ TTM adjusted EBITDA
`Immediately accretive to F’23 adjusted EBITDA dollars
`Expected to be on the OpenText operating model within 6 full quarters or sooner
`(3)
`Net leverage 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
`
`“We have a structured and disciplined approach to M&A. The last six months of planning has led us to a defined
`integration plan to deliver on our committed outcomes. We are ready and excited about winning the Information
`Management market, strong customer outcomes, and company growth and expanded cash flows,” concluded
`Barrenechea.
`
`About OpenText
`OpenText, The Information Company™, enables organizations to gain insight through market leading information
`management solutions, powered by OpenText Cloud Editions. For more information about OpenText (NASDAQ:
`OTEX, TSX: OTEX) visit opentext.com.
`
`Cautionary Statement Regarding Forward-Looking Statements
`Certain statements in this press release, including statements about the focus of Open Text Corporation
`(“OpenText” or “the Company”) in our fiscal year ending June 30, 2023 (Fiscal 2023) on growth, future cloud
`growth and market share gains, future organic growth initiatives and deployment of capital, the associated benefits
`of the Acquisition, including the Acquisition being immediately accretive to adjusted EBITDA dollars, the
`expectation to be on the OpenText operating model and net leverage reduction, new platform and product
`offerings and associated benefits to customers, scaling OpenText, expected cost synergies, and other matters,
`which may contain words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “may”,
`“could”, “would”, “might”, “will” and variations of these words or similar expressions are considered forward-looking
`statements or information under applicable securities laws. In addition, any information or statements that refer to
`expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or
`circumstances, including any underlying assumptions, are forward-looking, and based on our current expectations,
`forecasts and projections about the operating environment, economies and markets in which we operate. Forward-
`looking statements reflect our current estimates, beliefs and assumptions, which are based on management's
`perception of historic trends, current conditions and expected future developments, as well as other factors it
`believes are appropriate in the circumstances, such as certain assumptions about the economy, as well as market,
`financial and operational assumptions. Management's estimates, beliefs and assumptions are inherently subject to
`significant business, economic, competitive and other uncertainties and contingencies regarding future events
`and, as such, are subject to change. We can give no assurance that such estimates, beliefs and assumptions will
`prove to be correct. Such forward-looking statements involve known and unknown risks and uncertainties such as
`those relating to: all statements regarding the expected future financial position, results of operations, cash flows,
`dividends, financing plans, business strategy, budgets, capital expenditures, competitive positions, growth
`opportunities, plans and objectives of management, including any anticipated synergy benefits; our ability to
`integrate successfully Micro Focus’ operations and programs, including incurring unanticipated costs, delays or
`difficulties;  duration and severity of the COVID-19 pandemic, including any new strains or resurgence; and our
`ability to develop, protect and maintain our intellectual property and proprietary technology and to operate without
`infringing on the proprietary rights of others. For additional information with respect to risks and other factors
`which could occur, see the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other
`securities filings with the Securities and Exchange Commission (SEC) and other securities regulators. Readers are
`cautioned not to place undue reliance upon any such forward-looking statements, which speak only as of the date
`made. Unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation
`to update or revise any forward-looking statements, whether as a result of new information, future events or
`otherwise.
`
`Non-GAAP Financial Measures
`This press release include certain "non-GAAP measures." Please refer to the Company's "Reconciliation of selected
`GAAP-based measures to Non-GAAP-based measures" included within the Company's current and historical filings
`on Forms 10-Q, 10-K and 8-K for more information on the use of non-GAAP measures by the Company. 
`
`Copyright © 2023 OpenText. All Rights Reserved. Trademarks owned by OpenText. One or more patents may cover
`this product(s). For more information, please visit https://www.opentext.com/patents.
`
`Note: All dollar amounts in this press release are in US dollars unless otherwise indicated.
`TTM revenue represents Micro Focus’ unaudited revenue for the twelve months ended October 31, 2022,
`excluding Digital Safe revenue, based on IFRS standards.
`TTM adjusted EBITDA is a non-IFRS financial measure and represents Micro Focus’ unaudited adjusted EBITDA
`for the twelve months ended October 31, 2022, excluding Digital Safe.
`Consolidated Net Leverage Ratio (pro forma) is calculated using bank covenant methodology.
`
`Further information, please contact:
`
`Harry E. Blount
`Senior Vice President, Investor Relations
`OpenText Corporation
`415-963-0825
`investors@opentext.com
`
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