The biggest deal in Waterloo Region tech history closed this week as OpenText finalized the US$5.8-billion acquisition of British SaaS company Micro Focus International.

The merger of the two companies – which had combined revenue of about US$6 billion in 2022 – makes Waterloo-based OpenText one of the largest B2B software and cloud businesses in the world.

OpenText’s roots stretch back to 1989 when a group of researchers at the University of Waterloo created a searchable version of the Oxford English Dictionary. That work led to the Internet’s first search-engine technology, which was adopted by Yahoo.

The company evolved over the years and is known today for business-to-business information management software.

OpenText’s acquisition of Micro Focus was first announced last August and finalized over the past six months.

“With this acquisition, OpenText’s corporate mission expands to help enterprise professionals secure their operations, gain more insight into their information, and better manage an increasingly hybrid and complex digital fabric with a new generation of tools that include Cybersecurity, Digital Operations Management, Applications Modernization & Delivery and AI & Analytics,” said Mark Barrenechea, OpenText’s CEO and CTO. 

The company said in a news release that it will be cutting combined staff by approximately eight per cent, a move that’s expected to save US$400 million in “cost synergies.” There were no details about where those layoffs would occur.

OpenText employs about 14,000 people worldwide. Micro Focus employs about 11,000.

The combined companies are expected to generate about US$6 billion in annual revenue. OpenText reported US$3.5 billion in revenue in fiscal 2022. Micro Focus said in October that it expected revenues of approximately US$2.5 billion for the same fiscal year.

OpenText shares trade on both the Toronto Stock Exchange (TSX) and on the NASDAQ. Share price was down slightly in afternoon trading today on both exchanges, hovering around CDN$44.00 on the TSX.