Burntsand Inc., a company that provides technology consulting services for customers with information processing and management requirements in the enterprise content management (ECM), collaboration and service management practice areas, announced an agreement with Open Text Corporation, a provider of ECM capabilities.

Under the agreement, all the issued and outstanding common shares of Burntsand will be acquired by Open Text Corporation via a Burntsand shareholder approved merger with a subsidiary of Open Text under the Canada Business Corporations Act.

Burntsand shareholders will get CDN percent 0.15 in cash for every Burntsand common share according to the terms of the ultimate agreement. A premium of around 100 percent above the 30-day Burntsand's common share's average closing price is represented by this purchase price. The approximate value of this transaction is CDN $11 million.

The transaction, projected to close in the second quarter of the calendar, is subject to regular closing condition such as approval by not less than two thirds of the votes from Burntsand's shareholders. On May 27, a special meeting among Burntsand's shareholders is expected to be held to consider the merger.

Included in the ultimate agreement are regular non-solicitation and right to match provisions. If the merger is not completed under definite conditions, Burntsand has agreed to pay a termination fee to Open Text Corporation. BDO Canada LLP, has given a fairness opinion to the Board of Directors of Burntsand, that the consideration to be received under the merger is fair to Burntsand shareholders from a financial perspective.

The board of directors of Burntsand and its directors and officers, and one other shareholder which, as a group, represents a total of about 21.7 percent of Burntsand's issued and outstanding shares has undividedly approved the transaction proposed. They've also gotten into voting agreements with Open Text Corporation to vote in the merger's favor.