Dell EMC sells Enterprise Content Division to OpenText

Dell EMC continues to offload unwanted divisions within the new company, and the latest victim is its Enterprise Content Division (ECD), including Documentum. They have been acquired by enterprise information management company Opentext.com, for $1.62 billion (£1.22bn).

The transaction is still subject to regulatory approvals, and is expected to close within 90 to 120 days. All software, associated services, and employees of ECD will be integrated into OpenText. OpenText hopes to "further strengthen its vertical offerings, customer base, managed services, and geographical coverage".

The acquisition was made with the help of Barclays, which served as a financial advisor to OpenText and also provided $1 billion to support the transaction.

"We are at the beginning of the Digital revolution where extreme connectivity, automation, and computing are converging", says OpenText CEO and CTO Mark J. Barrenechea. "This acquisition further strengthens OpenText as a leader in Enterprise Information Management, enabling customers to capture their Digital future and transform into information-based businesses. We are very excited about the opportunities which ECD and Documentum bring, and I look forward to welcoming our new customers, employees, and partners to OpenText".

OpenText also said its main objectives are to keep a conservative capital structure and to preserve its current credit rating. Permanent financing may include cash on hand, borrowings and newly issued equity, it was added.

"ECD provides great value for customers, and we are pleased that this will be enhanced as part of OpenText", said David Goulden, President, Dell EMC. "In determining the best long-term future for ECD, we wanted to create a business with a leading position in Enterprise Information Management. OpenText shares our vision for the transformation to digital business, our passion for the role of information in the digital world, and the breadth of capabilities to help our customers realize that vision. Importantly, OpenText also shares our commitment to deliver a world-class total customer experience. Today’s news is great for all stakeholders".

John Newton, Alfresco CTO and Founder, comments: "This news is another classic case of two legacy vendors coming together, but it does nothing to advance innovation. Furthermore, it begs a lot of conjecture about what OpenText will do with yet another ECM product, where there is no precedent of them being able to integrate any of their previously acquired products. I feel for each set of customers as they are faced with overlapping product sets and nothing but complexity in their future. With companies looking for clarity about how to digitally transform, the OpenText acquisition breeds more questions than answers. I encourage their customers to try and embrace open ECM and BPM platforms that provide a path forward into the future, where companies innovate faster together".

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