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ACQUISITIONS | 6 Months Ended
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Dec. 31, 2021
Business Combination and Asset Acquisition [Abstract] |
ACQUISITIONS | ACQUISITIONS Fiscal 2022 Acquisitions Acquisition of Zix Corporation On December 23, 2021, we acquired all of the equity interest in Zix Corporation (Zix), a leader in software as a service (SaaS) based email encryption, threat protection and compliance cloud solutions for small and medium-sized businesses (SMB). Total consideration for Zix was $896.0 million, comprised of $875.9 million paid in cash (inclusive of cash acquired) and $20.1 million, relating to the cash settlement of pre-acquisition vested share-based compensation, currently held back and unpaid in accordance with the purchase agreement. In accordance with ASC Topic 805 "Business Combinations" (Topic 805), this acquisition was accounted for as a business combination. We believe the acquisition increases our position in the data protection, threat management, email security and compliance solutions spaces. The results of operations of Zix have been consolidated with those of OpenText beginning December 23, 2021. Preliminary Purchase Price Allocation The recognized amounts of identifiable assets acquired and liabilities assumed, based on their preliminary fair values as of December 23, 2021, are set forth below:
Current assets (inclusive of cash acquired of $38.3 million) | $ | 66,471 |
Non-current tangible assets | 40,935 |
Intangible assets | 374,600 |
Liabilities assumed | (94,045) |
Total identifiable net assets | 387,961 |
Goodwill | 508,026 |
Net assets acquired | $ | 895,987 |
The goodwill of $508.0 million is primarily attributable to the synergies expected to arise after the acquisition. There is $103.7 million of goodwill that is deductible for tax purposes. The fair value of current assets acquired includes accounts receivable with a fair value of $19.2 million. The gross amount receivable was $19.8 million, of which $0.6 million is expected to be uncollectible. Acquisition-related costs for Zix included in "Special charges (recoveries)" in the Condensed Consolidated Financial Statements for the three and six months ended December 31, 2021 were $2.1 million, respectively. Also included in "Special charges (recoveries)" for the three and six months ended December 31, 2021, were $2.0 million, respectively, in other charges related to pre-acquisition equity incentives, which upon acquisition were replaced by equivalent value cash settlements to be settled in accordance with the original vesting dates (see note 18 "Special Charges (Recoveries)." As of December 31, 2021, we expect $26.7 million to be settled in cash and recorded to "Special charges (recoveries)" primarily over the next two years. The finalization of the above purchase price allocation is pending the finalization of the valuation of fair value for the assets acquired and liabilities assumed, including intangible assets and taxation-related balances as well as for potential unrecorded liabilities. We expect to finalize this determination on or before our quarter ending December 31, 2022. Since the date of acquisition, the acquisition had no significant impact on revenues and net earnings for the three and six months ended December 31, 2021. Pro forma results of operations for this acquisition have not been presented because they are not material to our consolidated results of operations. Acquisition of Bricata Inc. On November 24, 2021, we acquired all of the equity interest in Bricata Inc. (Bricata) for $17.9 million. In accordance with Topic 805, this acquisition was accounted for as a business combination. We believe the acquisition strengthens our OpenText Security and Protection Cloud with Network Detection and Response technologies. The results of operations of Bricata have been consolidated with those of OpenText beginning November 24, 2021. Since the date of acquisition, the acquisition had no significant impact on revenues and net earnings for the three and six months ended December 31, 2021. Pro forma results of operations for this acquisition have not been presented because they are not material to our consolidated results of operations.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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