Progress on buying Cloud Software unit ShareFile for $875 million by Reuters

(Reuters) – Progress software (NASDAQ: ) said Monday it will buy Cloud Software Group’s ShareFile unit for about $875 million as the artificial intelligence software firm looks to boost its enterprise product portfolio.

The transaction is expected to close in Progress’ fiscal year ending November 30.

ShareFile, launched in 2005 by Jesse Lipson, uses advanced encryption methods when sending and storing files. The unit is expected to contribute $240 million to Progress’ annual revenue, thanks to its customer base of more than 86,000.

Burlington, Massachusetts-based Progress (NYSE: ) has a market cap of about $2.5 billion. Its products are used by customers to automate business processes, transfer data and fix network problems by monitoring IT infrastructure.

Progress said it will also suspend its quarterly dividend from the closing of the ShareFile acquisition as it plans to redirect capital toward paying down debt to increase liquidity for future deals and share buybacks.

Progress also said Monday that it expects revenue and adjusted earnings per share for the fiscal third quarter to be at or above the high end of the forecast it provided on June 25.