MFGP - Why Micro Focus Stock Exploded Higher Friday Morning While Open Text Slumped
Shares of Micro Focus International (NYSE: MFGP) charged sharply higher on Friday morning, surging as much as 96.8%. At the same time, shares of Open Text (NASDAQ: OTEX) slumped as much as 13.4%. As of 12:30 p.m. ET, Micro Focus stock was still up 94.2%, while Open Text was down 12.8%.
The catalyst that sent shares of the technology companies in opposite directions was an unsolicited takeover bid by Open Text for its rival.
Open Text announced in a press release on Friday that it had reached an agreement to acquire Micro Focus, paying 532 pence (roughly $6.29) per share for its UK rival, in an all-cash deal valued at roughly $6 billion. The buyout price represents a premium of about 99% compared to Micro Focus's closing price on Thursday and implies an enterprise value of about $6 billion.
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Why Micro Focus Stock Exploded Higher Friday Morning, While Open Text Slumped