Shares in Micro Focus jumped to an all time high of 935 pence, up 11 percent, following the announcement of the deal.ДЄnalyst George O'Connor at Panmure Gordon, who has a 'buy' rating on the shares, said the deal was a big step towards Micro Focus becoming an 'all applications modernisation company'. He said Micro Focus was buying Attachmate for about 7.5 times core earnings, a significant discount on the 11.3 times earnings Micro Focus trades at. Loosemore, who retains his position in the combined group, said the deal would lift Micro Focus's revenue to about US$1.4 billion from about US$430 million, and its underlying core earnings to more than US$500 million from US$196 million. The owners of Attachmate include the Francisco Partners Funds, the Golden Gate Funds, the Thoma Bravo Funds and the Elliott Management Fund. Loosemore said Micro Focus had been talking on and off with The Attachmate Group for about three years before finally agreeing a deal. 'This gives us a broader set of products to deliver that, and it also exposes us to some faster growing markets.'

'We aim to help customers sort out some of the challenges of their older IT systems and link them to new technology, so they can get more return on their current investments,' Micro Focus executive chairman Kevin Loosemore said. The two groups serve major corporate clients such as banks, retailers and airlines that run mainframe computers, helping them modernise the technology so applications and databases can be accessed by newer systems. Micro Focus today said that following the reverse takeover, its shareholders would own about 60 percent of the equity in the new group. The all-share deal values the firms' combined capital and debt at US$2.35 billion. British listed mainframe computer specialist Micro Focus has announced its intention to buy privately-owned US rival The Attachmate Group for US$1.2 billion (A$1.3 billion), a deal which is expected to result in a new entity that will relist on the London stock exchange.

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