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NEW YORK (TheStreet) -- Shares of Open Text (OTEX) - Get Open Text Corporation Report  were advancing 8.10% to $64.61 on heavy trading volume mid-morning Monday as the Canadian software company agreed to purchase Dell Technologies' (DVMT) enterprise content business for $1.6 billion. 

Open Text is buying Documentum, a corporate document tracking software that was owned by EMC, which Dell purchased earlier this month. The company said it hopes that the deal will strengthen its enterprise content management division.

The acquisition is expected to be immediately accretive to Open Text's earnings, the company said in a statement. The deal is expected to close within 90 to 120 days. 

Open Text has been looking to grow revenue by buying legacy software from other companies and extracting more profit from them, Bloomberg reports. Earlier this year, the company purchased four different software programs from HP (HPQ) for $315 million.

About 303,777 of the company's shares have changed hands so far today vs. its average volume of 174,418 shares per day.

TheStreet Recommends

Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:

The team rates Open Text as a Buy with a ratings score of A-. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, reasonable valuation levels and notable return on equity. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

You can view the full analysis from the report here:

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