*Updated* Micro Focus (MCRO) has become the UK’s largest public technology company, with a market capitalisation of £9.9bn. This follows Friday’s announcement that the software group completed its $8.8bn (£6.8bn) merger with Hewlett Packard’s software business.
As part of the deal, Micro Focus returned approximately £368m in cash to its shareholders, representing 168p per share. And, after admission, HPE investors received the equivalent of 222m shares in American Depositary Receipts (ADRs); they now own around 50.1 per cent of the company’s fully diluted share capital. As expected, Chris Hsu is now chief executive of Micro Focus. He was previously executive vice president and general manager of HPE Software. Meanwhile, Micro Focus’s Kevin Loosemore has stayed on as executive chairman.
On Wednesday, Micro Focus published the performance of HPE’s software business for the three, nine and 12 months ending 31 July 2017. For the three months to July, revenues declined 3 per cent to $718m but the operating margin rose to 24.9 per cent, from 17.8 per cent a year earlier. Looking forward, total adjusted revenues (adjusted for divestitures and changes in currency exchange rates) are expected to range between $2.89bn and $2.96bn for the full year to 31 October 2017. This is lower than the $3.05bn adjusted revenues achieved in the 12 months to end of July, but is apparently driven by “the active reduction of less profitable professional services in sub-scale service lines and geographies” among other factors. And, only two months of this performance will be included in Micro Focus’s results for the 6 months ending 31 October.
