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ACQUISITIONS AND DIVESTITURES
 12 Months Ended
Jun. 30, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
ACQUISITIONS AND DIVESTITURES ACQUISITIONS AND DIVESTITURES
Fiscal 2024 Divestiture
Divestiture of AMC Business
On May 1, 2024, the Company completed the sale of its AMC business to Rocket Software for $2.275 billion in cash before taxes, fees and other adjustments. The results of the AMC business were recorded and presented within our Consolidated Financial Statements during Fiscal 2024 for the period of July 1, 2023 through April 30, 2024. In connection with the sale, a gain of $429.1 million was recorded in Other income (expense), net within our Consolidated Statements of Income for the year ended June 30, 2024. During the quarter ended December 31, 2024, working capital and other adjustments were finalized, which resulted in a payment of $11.7 million, and a decrease to the gain on the AMC Divestiture by $4.2 million.
The Company determined that the AMC business did not constitute a component, as its operations and cash flows cannot be clearly distinguished from the rest of the Company’s operations and cash flows due to significant shared costs, therefore, the transaction did not meet the discontinued operations criteria, and the results of operations from the AMC business are presented within Income from operations in our Consolidated Statements of Income up to the date of disposition.
The Company used the net proceeds from the transaction to prepay in full the outstanding principal balances of the Term Loan B and prepay a portion of the outstanding principal balance of the Acquisition Term Loan, as further described in Note 11 “Long-Term Debt.” The Company also agreed to provide certain transition services to Rocket Software following the completion of the divestiture for up to 24 months after the closing date of May 1, 2024, which are included in financing activities on the Consolidated Statements of Cash Flows. These transition service costs are reimbursable by Rocket Software. For Fiscal 2025, we billed Rocket Software $31.6 million under the Transition Services Agreement. The transition services were completed as of June 30, 2025.
The finalization of working capital and other adjustments during the quarter ended December 31, 2024, resulted in immaterial changes to the carrying amounts of major classes of assets and liabilities. The following table presents the carrying amounts of major classes of assets and liabilities disposed of in the AMC Divestiture as of April 30, 2024:
AMC Assets
Accounts receivable trade, net of allowance for credit losses
$58,733 
Contract assets
10,355 
Prepaid expenses and other current assets
6,099 
Property and equipment
1,091 
Goodwill
1,138,013 
Acquired intangible assets
930,771 
Deferred tax assets
2,820 
Other assets
1,775 
Total AMC Assets
$2,149,657 
AMC Liabilities
Accounts payable and accrued liabilities
$11,312 
Deferred revenues
188,648 
Long-term accrued liabilities
8,128 
Pension liability, net
1,640 
Long-term operating lease liabilities
672 
Long-term deferred revenues
23,623 
Long-term income taxes payable
9,845 
Deferred tax liabilities
116,086 
Total AMC Liabilities
$359,954 
Fiscal 2024 Acquisitions
Other Acquisitions
On August 23, 2023, we acquired all of the equity interest in KineMatik Ltd. (KineMatik), a provider of automated business process and project management solutions built on OpenText’s Content Server. In accordance with ASC Topic 805, “Business Combinations”, this acquisition was accounted for as a business combination. The results of operations of KineMatik have been consolidated with those of OpenText beginning August 24, 2023. The results of KineMatik are not considered to be material to our business.
On May 22, 2024, we acquired Pillr, a cloud native, multi-tenant Managed Detection and Response platform from Novacoast, Inc. for Managed Service Providers that includes powerful threat-hunting capabilities. In accordance with ASC Topic 805, “Business Combinations”, this acquisition was accounted for as a business combination. The results of operations of Pillr have been consolidated with those of OpenText beginning May 22, 2024. The results of Pillr are not considered to be material to our business.
Fiscal 2023 Acquisitions
Acquisition of Micro Focus
On January 31, 2023, we acquired all of the issued and to be issued share capital of Micro Focus for a total purchase price of $6.2 billion, inclusive of Micro Focus’ cash and repayment of Micro Focus’ outstanding indebtedness. The results of operations of Micro Focus have been consolidated with those of OpenText with effect from February 1, 2023.
In connection with the financing of the Micro Focus Acquisition, concurrent with the announcement of the acquisition on August 25, 2022, the Company entered into the Acquisition Term Loan and a now-terminated bridge loan as well as certain derivative transactions. On December 1, 2022, the Company issued and sold $1 billion in aggregate principal amount of 6.90% Senior Secured Notes 2027, amended the Acquisition Term Loan and terminated its bridge loan. On January 31, 2023, we drew down the entire aggregate principal amount of $3.585 billion of the Acquisition Term Loan, net of original issuance discount and other fees, and drew down $450 million under the Revolver. We used these proceeds and cash on hand to fund the purchase price consideration and repayment of Micro Focus’ outstanding indebtedness. In conjunction with the closing of the Micro Focus Acquisition, the deal-contingent forward contracts and non-contingent forward contract, as described in Note 17 “Derivative Instruments and Hedging Activities,” were settled.
The results of operations of Micro Focus have been consolidated with those of OpenText beginning February 1, 2023.
Purchase Price Allocation
The recognized amounts of identifiable assets acquired and liabilities assumed, based on their fair values as of January 31, 2023, are set forth below:
Cash and cash equivalents$541,584 
Accounts receivable, net of allowance for credit losses (1)
408,921 
Other current assets (3)
288,842 
Non-current tangible assets441,129 
Goodwill (2) (3)
3,385,572 
Intangible customer assets2,162,400 
Intangible technology assets1,392,300 
Accounts payable and accrued liabilities(473,635)
Deferred revenues(1,107,627)
Other liabilities (3)
(793,049)
Net assets acquired
$6,246,437 
______________________
(1)The gross amount receivable was $418.2 million, of which $9.3 million of this receivable was expected to be uncollectible.
(2)The goodwill of $3.4 billion is primarily attributable to the synergies expected to arise after the acquisition. There is $67.3 million of goodwill that is deductible for tax purposes.
(3)Purchase price allocation adjustments of $32.1 million for the year ended June 30, 2024, were primarily driven by changes in other current assets and other liabilities related to adjustments of pre-acquisition other current assets and deferred tax liabilities.
A settlement related to Micro Focus’ securities litigation that was agreed to prior to the Micro Focus Acquisition has been accrued as part of the liabilities assumed. This settlement, which received final court approval and is now resolved, was fully paid from insurance coverage, and therefore a receivable was recognized as part of the assets acquired. During the third quarter of Fiscal 2023, payment was made into escrow by insurers, and therefore both the associated receivable and liability are no longer included on the Consolidated Balance Sheets as of June 30, 2023.
Acquisition-related costs for Micro Focus included in Special charges (recoveries) in the Consolidated Statements of Income for the year ended June 30, 2025 were nil (year ended June 30, 2024 and 2023—$1.1 million and $48.3 million).
The amount of Micro Focus’ revenues and net loss included in our Consolidated Statements of Income for the year ended June 30, 2023 is set forth below:
February 1, 2023 – June 30, 2023
Revenues$976,537 
Net loss (1)
$(94,741)
______________________
(1)Net loss for the year ended includes one-time fees of approximately $82.9 million on account of special charges and $202.4 million of amortization charges relating to intangible assets.
The unaudited pro forma revenues and net income of the combined entity for the year ended June 30, 2023, had the Micro Focus Acquisition been consummated on July 1, 2022, are set forth below:
Year Ended June 30,
Supplemental Unaudited Pro Forma Information2023
Revenues$5,933,106 
Net income (loss) (1)
(500,105)
Net income (loss) attributable to OpenText (1)
(500,292)
______________________
(1)Included in the pro forma net loss for the year ended June 30, 2023, is a $448.2 million goodwill impairment recorded by Micro Focus in its pre-acquisition historical results as a result of the Company’s offer to acquire Micro Focus at a price of 532 pence per share.
The unaudited pro forma financial information in the table above is presented for information purposes only and is not indicative of the results of operations that would have been achieved if the Micro Focus Acquisition had taken place at the beginning of the periods presented or the results that may be realized in the future.