Micro Focus (MCRO) might have acquisition as its middle name because in the last six years it has made 10 acquisitions, and – assuming the year-long process of buying Hewlett Packard’s software business completes in September – revenue will have increased 10 fold since 2011.
When the HPE deal goes through, Micro Focus will be one of the world’s largest dedicated software businesses, providing the means for companies to modernise and squeeze value out of their IT infrastructure. The business model throws off a lot of cash, and in the year to April 2017 this rose from $456.1m (£354m) in the previous year to $564.8m; that’s around 102 per cent of adjusted cash earnings. It also means that net debt fell from $1.63bn following the Serena acquisition in May last year to $1.41bn.