The Daily Telegraph
Microfocus buyer to cut jobs after merger
THE Canadian buyer of British tech firm Microfocus is preparing to cut jobs as part of a £5bn merger.
The two companies are planning to make cost savings of $400m (£350m), which will lead to a “moderate headcount reduction” once the deal is complete, chairman Gregory Lock said in a letter to shareholders.
Around $300m of those savings were announced by Microfocus, which develops business software and provides IT consulting, earlier this year. Staff have already been hit by reductions as part of a restructuring.
The two companies expect to make a further $100m in cost savings. This will include cutting listing and audit costs as well as slashing duplicate roles.
It is understood that any cuts are not expected to impact its engineering teams. The reductions could hit doubled-up roles such as human resources and corporate teams. In the scheme of arrangement sent to shareholders yesterday, the companies said: “At this stage, no decisions have been made in relation to the extent to which headcount reductions in any geographies or areas of the business might contribute towards the targeted cost savings.”
Microfocus, which is headquartered in Newbury, Berkshire, currently employs 11,000 people. Opentext, which is based in Ontario in Canada, has 15,000 staff.
In August, Microfocus said it had agreed to a £5bn takeover, including debt, by Canada’s Opentext, valuing its shares at 532p each.
The former FTSE 100 company’s share price has been eroded over the past five years after a troubled merger with the former software division of Hewlett Packard Enterprise.
The takeover of Microfocus is one of a string of software deals that are expected to remove a slew of technology businesses from London’s public markets.