OpenText™ (NASDAQ: OTEX), (TSX: OTEX), “The Information Company,” announced today that it has completed the closing of the previously announced acquisition of Carbonite, Inc. (“Carbonite”), provider of cloud-based subscription data protection, backup, disaster recovery and endpoint security to small and medium-sized businesses and prosumers.
“I am delighted to announce today the completion of the Carbonite acquisition and warmly welcome Carbonite customers, partners, and employees to OpenText. Combined, we will be able to provide our customers the first end-point platform that offers data protection, endpoint security, intrusion detection and digital forensics – ensuring cyber resiliency and trusted innovation,” said Mark J. Barrenechea, OpenText CEO & CTO. “Carbonite brings a world-class channel organization and partners, allowing OpenText to bring EIM to all size customers including SMB to prosumers.”
Barrenechea further added, “We have confidence in our ability to integrate, innovate and grow the business. As previously highlighted, we are targeting for Carbonite to be on our operating model by the end of Fiscal 2021, or sooner. We expect strong cloud growth and cash flow expansion from the acquisition.”
Preliminary Financial Overview
OpenText expects Carbonite to contribute no material revenue or operating expenses over the holiday season between December 24th and 31st, within the current quarter (Fiscal 2020 Q2). Further financial projections from OpenText, as well as updated target models, will be provided when the company reports its second quarter Fiscal 2020 financial & business results.
Terms of the Acquisition
The tender offer for all outstanding Carbonite shares for $23.00 per share in cash is now complete, Carbonite is now a wholly-owned subsidiary of OpenText
Total purchase price of approximately $1.45 billion, inclusive of Carbonite’s cash and debt
The total purchase price is approximately 2.9x TTM (Trailing Twelve Months) Carbonite GAAP revenues (as of September 30, 2019), inclusive of annualized full-year reported Webroot GAAP revenues, a significant acquisition by Carbonite which closed in March 2019
Current Carbonite Reported Annual Recurring Revenues (ARR) of 90%
Accretive and expected to be on the OpenText operating model by end of Fiscal 2021 or sooner
Funded with OpenText’s existing cash on hand and debt revolver
Estimated OpenText net leverage ratio at the closing of approximately 2.5x, with an expectation to return to less than 2x net leverage during the next 4-6 quarters
Source:OpenText (NASDAQ: OTEX, TSX: OTEX)