Captaris Acquired by Open Text for $131M—but How Good a Deal Is It?

9/4/08Follow @gthuang

Another big acquisition has come to town. Bellevue, WA-based software firm Captaris said today it is being acquired by Open Text, a business-software company based in Waterloo, Ontario. The deal is worth about $131 million, and is expected to close by the end of the year. The purchase, for $4.80 a share, represents a 31 percent increase over yesterday’s closing stock price of $3.67.

Founded in 1982, Captaris (NASDAQ: CAPA) makes software to manage and work with documents and business data, such as products that convert paper documents to digital files and automate the flow of content. In March, the company rejected a bid from private-equity firm Vector Capital.

It’s a pretty big deal, but I suspect Captaris was looking for something even bigger, given how well-established it is in the market. “After a thorough evaluation of strategic alternatives, the Captaris Board of Directors believes that today’s announcement provides value for our shareholders and the certainty of cash,” said David Anastasi, president and CEO of Captaris, in a statement. “Together with our shareholders, our customers, partners and employees will benefit as Captaris combines with Open Text, a market leader with the financial strength to take our company to the next stage in its evolution.”

The companies didn’t say in their statement what will happen to Captaris’s 400-odd employees.

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com or call him at 617-252-7323. Follow @gthuang

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