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Open Text enters agreement to buy Nstein Technologies for $35 million

Mon, 02/22/2010 - 6:30am
The Associated Press

Open Text Corp. (TSX:OTC) is offering to buy digital content manager Nstein Technologies Inc. in a deal that values the Montreal-based company at $35 million — nearly double Nstein's recent market price.

The Waterloo, Ont-based software firm said Monday that Nstein (TSXV:EIN) shareholders would receive 65 cents in cash for each common share— 91 per cent higher than the Friday closing price and double the 30-day average price.

Certain Nstein shareholders can also opt to receive a fraction of an Open Text share worth 65 cents. A closing date is expected in the second quarter, pending approval of regulators and Nstein's shareholders during a meeting in April.

Nstein develops and sells multilingual technology that powers digital publishing for newspapers, magazines, and content-driven websites.

"With Nstein, we have an opportunity to continue to grow as Canada's largest software company, expanding Open Text's presence in Quebec," said Open Text president and CEO John Shackleton in a release.

The deal has the support of Nstein's board of directors but the transaction requires shareholder approval. The agreement also includes an undisclosed termination fee that Nstein would pay if the transaction isn't completed.

Open Text shares climbed 26 cents to $49.48 on the Toronto Stock Exchange. Nstein's shares gained 30 cents to 64 cents after a trading halt was lifted Monday morning, following the announcement.

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