The Canadian software vendor tabled its $240 million bid for Munich-based Ixos last month, amidst a frenzy of consolidation in the market that is stretching the boundaries of ECM functionality almost on a monthly basis now.
Open Text is certainly no stranger to acquisition having absorbed around 20 companies since its inception. But Ixos is by far its biggest buy to date and will challenge the integration skills of the company on both the product and corporate fronts.
With this latest acquisition Open Text will now focus on two core competencies – collaboration and content management, signaling a slight shift away from its knowledge management (KM) mantra.
It confirmed that its collaboration business will be run from its North American Chicago offices, while its content management and archiving business will operate from Munich, Germany.
A small technical group focused exclusively on PeopleSoft and JD Edwards applications would continue to operate through offices in Irvine, California. However, an Ixos satellite division located on SAP AG’s campus and focused on SAP applications would be disbanded and absorbed into its European operations.
Open Text believes both companies will benefit from the deal by gaining footholds in markets where they have been historically weak. Open Text is strong in the US, UK and France, while Ixos is strong in Portugal, Spain, and of course Germany.
The combined company is expected to generate revenue in the region of around $325 million and will employ over 2,000 staff worldwide. Bringing Ixos into the mix, which is projected to grow its revenues 10% this year, will also have a beneficial impact on Open Text’s revenue spread, with a near 50-50 split after the merger and around 45% of revenue coming from both North America and Europe, with the rest coming from Asia-Pacific.
The deal is expected to be closed in the next 120 days.
This article was based on material originally published by ComputerWire.
