Rocket Software, Inc., a technology solutions provider, has signed a definitive agreement to acquire OpenText’s Application Modernization and Connectivity business (AMC), previously under Micro Focus, for $2.275 billion.
AMC, known for application modernization tools like COBOL and host connectivity, empowers organizations to leverage core applications flexibly, facilitating their migration while supporting operations wherever preferred. Rocket Software’s acquisition of AMC enhances its modernization portfolio, aligning with diverse customer demands, whether on-premises or through hybrid cloud strategies.
“For the many enterprise organizations that are built on the mainframe and ready to unlock opportunity using hybrid cloud, reality calls for a continuum with solutions and expertise that span both worlds,” said Milan Shetti, president and CEO of Rocket Software. “Welcoming the AMC business and its talented team to Rocket Software marks an extraordinary moment for the company, the market, and the thousands of organizations who share in our vision of making the best of both worlds a reality.”
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The acquisition will be funded through a mix of cash equity, committed debt financing, and existing cash reserves. Expected to close by Q2 2024, the deal awaits regulatory approvals and customary closing conditions.
Hybrid cloud strategy
Rocket Software has tackled intricate IT challenges for top-tier organizations across infrastructure, data, and applications. Their hybrid cloud strategy enables clients to optimize their application portfolio seamlessly, bridging modern use cases without disrupting vital operations. This approach merges the security of mainframes with the versatility of cloud-based analytics.
This acquisition serves five strategic objectives for Rocket Software:
1. Offering a comprehensive product portfolio catering to modernization across mainframe to hybrid workloads, meeting organizations at any stage of their modernization journey.
2. Empowering customers to extract value from core applications while embracing new technologies.
3. Establishing Rocket Software as a leader in hybrid cloud, ensuring sustained growth in legacy enterprise IT markets and fostering lasting customer relationships.
4. Leveraging AMC’s R&D expertise to drive continuous innovation using emerging technologies.
5. Strengthening Rocket Software’s position as the preferred partner for industry and customer needs, driving superior customer success.
By combining Rocket Software’s service with enhanced innovation capabilities, the company aims to improve customer relationships, expand opportunities, and ensure sustainable growth.
Rocket Software’s move to acquire AMC aligns with its vision of navigating modernization landscapes and delivering comprehensive solutions to diverse customer needs.