Newbury based Micro Focus to sell its "Digital Safe business"

By Nicky Godding

4 November 2021

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Micro Focus International plc, the Newbury, Berkshire headquartered global enterprise software business, has to sell its Archiving and Risk Management portfolio (the "Digital Safe business") to Oregon-based Smarsh Inc for $375 million.

The Digital Safe business forms part of the Information Management and Governance (IM&G) Product Group.

Stephen Murdoch, Micro Focus CEO said: "Micro Focus acquired the Digital Safe business in September 2017 as part of the HPE transaction. Since this date, we are proud of the progress made, with our focus on customer-centric innovation delivering significant improvements to the portfolio and enabling us to begin the transition to a cloud-first business model.

"Looking ahead, Archiving and Risk Management is changing rapidly and becoming an increasingly specialised area. We believe that by combining the Digital Safe business with Smarsh, a leading innovator in this area, our Digital Safe customers and employees will see significant benefits and be better served for the long term."

Brian Cramer, Smarsh CEO added: "We are delighted to announce the acquisition of the Digital Safe business from Micro Focus. Smarsh focuses its efforts on meeting the sophisticated risk, compliance and e-discovery needs of regulated industries. We see significant opportunity in helping our existing, mutual and future customers to extend the value of their retention and oversight technology investments and to facilitate communications data strategies that will meet the challenges of tomorrow. Upon completion of the transaction, we'll work together with our new expanded team to deliver this vision to our customers."

In FY21, the Digital Safe business is expected to generate approximately $109m of revenue, a decline of approximately 11 per cent compared to the prior year.

It is the intention of the Micro Focus Board to use the net proceeds of the transaction, estimated at $335m net of fees, taxation and separation costs to reduce gross debt.

By Nicky Godding

Nicky Godding is editor of The Business Magazine. Before her journalism career, she worked mainly in public relations moving into writing when she was invited to launch Retail Watch, a publication covering retail and real estate across Europe.

After some years of constant travelling, she tucked away her passport and concentrated on business writing, co-founding a successful regional business magazine. She has interviewed some of the UK’s most successful entrepreneurs who have built multi-million-pound businesses and reported on many science and technology firsts.

She reports on the region’s thriving business economy from start-ups, family businesses and multi-million-pound corporations, to the professionals that support their growth and the institutions that educate the next generation of business leaders.