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Cloud backup provider Carbonite to be acquired for $1.4 billion

By Ramla Soni

The $1.42 billion deal, led by OpenText, is subject to customary closing conditions

Carbonite, a Boston-based provider of cloud-based data backup and cybersecurity software, is to be acquired by OpenText, a Canadian provider of Enterprise Information Management (EIM) software and solutions, for $23 (£18) per Carbonite share in cash.

The deal is worth $1.42 billion (£1.1bn, €1.2bn), which is a 78 per cent premium on Carbonite’s stock price on 5 September 2019, the last trading day before a media report was published speculating about a potential sale process.

The transaction is subject to customary closing conditions, including the tender of a majority of the outstanding shares of Carbonite common stock and regulatory approvals.

“Following expressions of interest from multiple parties, the Carbonite Board conducted a thorough and comprehensive process, which included contact with a number of strategic and financial parties, to identify the best way to maximise shareholder value," said Steve Munford, interim chief executive officer and president/executive chairman of the board of Carbonite.

The board “strongly believes” that a transaction with OpenText delivers “compelling, immediate and substantial cash value” to shareholders.

OpenText is a leader in EIM, both on-premises and for cloud services, offering the only complete solution for EIM with a comprehensive view of all the information within an organisation. The company operates in 40 countries, providing a tested platform for growth and new sales opportunities.

FURTHER READING: IBM partners with Bank of America to build specific financial cloud

Carbonite’s revenue increased 62 per cent year-over-year to $125.6 million in the third quarter ending 30 September 2019.

FURTHER READING: Business software group SAP signs three-year cloud contract with Microsoft

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