WATERLOO, ON, Dec. 23, 2021 /PRNewswire/
-- OpenText™ (NASDAQ: OTEX), (TSX: OTEX) today
announced that it has completed the closing of the previously
announced acquisition of Zix Corporation (NASDAQ: ZIXI) ("Zix"), a
leader in SaaS-based email encryption, threat protection and
compliance cloud solutions for Small and Medium-sized Businesses
(SMBs).
"I would like to welcome Zix customers, partners, and employees
to OpenText. Combined, we will be able to provide our customers a
powerhouse SMB platform for data protection, threat management,
email security and compliance solutions," said OpenText CEO &
CTO Mark J. Barrenechea. "Zix
meaningfully expands our distribution capabilities with MSP
partners, enhances our SMB offering and deepens our go-to-market
relationship with Microsoft."
Barrenechea further added, "OpenText is committed to winning
Information Management in both the Enterprise and SMB markets.
We are targeting for Zix to be on our operating model within
12-18 months and as previously highlighted, once integrated, we
expect Zix to be accretive to organic growth and margin
dollars."
Preliminary Financial Overview
OpenText expects no material revenue or operating expenses from
Zix over the holiday season between December
23rd and 31st, within the current quarter (Fiscal 2022 Q2).
Further financial projections from OpenText, as well as updated
target models, will be provided when the company reports its second
quarter Fiscal 2022 financial & business
results.(1)
Terms of the Acquisition
- The tender offer for all outstanding Zix common stock
(including shares of common stock issued upon conversion of Zix's
Series A Preferred Stock) for $8.50
per share in cash is now complete and Zix is now a wholly-owned
subsidiary of OpenText
- Total purchase price of approximately $860 million, inclusive of Zix's cash and
debt
- The total purchase price is approximately 3.5x TTM (Trailing
Twelve Months) Zix GAAP revenues (as of September 30, 2021)
- Zix Reported Annual Recurring Revenues (ARR) of 90%
- Accretive and expected to be on the OpenText operating model
within 12-18 months
- Funded with OpenText's existing cash on hand
(1) Upon closing, Zix's resell business will be reported
on a "net" basis to conform to OpenText's revenue recognition
policies. The net basis recognition will result in Zix's immediate
conformance to OpenText Gross Margin Model.
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
regarding OpenText's plans, objectives, expectations and intentions
relating to the acquisition, the acquisition's expected
contribution to OpenText's results, financing and closing of the
acquisition, as well as the expected timing and benefits of the
acquisition, impact on future financial performance including in
respect of annual recurring revenues, cloud growth, adjusted
EBITDA, cash flows and earnings, may contain words considered
forward-looking statements or information under applicable
securities laws. These statements are based on OpenText's current
expectations, estimates, forecasts and projections about the
operating environment, economies and markets in which OpenText
operates, as well as the impact of the ongoing COVID-19 pandemic.
These statements are subject to important assumptions, risks and
uncertainties that are difficult to predict, and the actual outcome
may be materially different. OpenText's assumptions, although
considered reasonable by the company at the date of this press
release, may prove to be inaccurate and consequently its actual
results could differ materially from the expectations set out
herein. For additional information with respect to risks and other
factors, which could occur, see OpenText's Annual Report on Form
10-K, Quarterly Reports on Form 10-Q and other securities filings
with the SEC and other securities regulators. Unless otherwise
required by applicable securities laws, OpenText disclaims any
intention or obligations to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Copyright © 2021 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.
OTEX-MNA
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SOURCE Open Text Corporation