You'll never work in this industry again - Microsoft 1994
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Novell will be asset stripped
SOURCES AT the investment fund Elliot have confirmed that if it is successful in its bid to take over Novell, the outfit will be asset stripped.
Its Netware networking-software unit will be flogged and the company will look for a buyer for its SUSE Linux operation.
Officially Elliott is saying somewhat the opposite. In an official statement Elliott said that it intends to own Novell and has no plans to sell off any business units.
However a deep throat talking to Bloomberg said sell-offs are likely as the company turns around Novell.
We'd think that if Novell's SUSE Linux business is sold off then there will not be much left. Netware has been slowly dying for years and is unlikely to make a comeback.
The Novell board is scheduled to meet early next week to consider Elliott's offer. The fear is that if it does not agree to the deal then shareholders could revolt.
In its letter made public on March 2, Elliott said Novell's shares have "underperformed all relevant indices and peers."
One of the areas where Elliot apparently thinks the company is overspending is on employees, so if it buys the company then staff cuts seem all but certain. Although Novell's sales revenues are about the same as those of its rival Red Hat it has more employees. µ
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you are sadly wrong. There is plenty of value left in Netware. Netware 6.5 STILL runs like a refrigerator, same as it has since 3.12. There's just nothing "new" and "sexy" about Netware - it's just plain, old Netware. The value is in whether or not it will do what the user needs it to do. For file and printer sharing, and for running a user Directory, Netware is still top-dog, IMHO. For webserving and database, yes, there are much better options elsewhere.
And Groupwise isn't too shabby either.
Ben Myers: Netware is the cash cow feeding Novell. The corporate support contracts are what bring the money in. The future may look different, though.
Regards from a CNE!
The author of this article is a master of understatement with "Netware has been slowly dying for years and is unlikely to make a comeback."
How about: Netware is on life-support????
Value in Netware is nowhere to be found. Novell's value lies in Unix and Suse... Ben Myers
I will be (even more) sadly disappointed in the human race if this piranha Elliot is allowed to acquire all of Novell's patents (including the UNIX IP), their skilled people, their fine Linux business for less than a billion dollars.
And, of course, we do not really know who may be pulling the strings that are animating the Elliot-puppet (perhaps, cough-Microsoft-cough-just-like-SCO-cough). Microsoft probably could not buy them directly due to anti-trust issues (but they may be able to eat some of Elliot's scattered scraps).
I am sure (hoping) a white knight will ride in and rescue them. IBM or Google would be nice UNIX-friendly owners.
Actually, Novell's biggest problem at this point is it doesn't have the personnel resources to develop and innovate its products well, especially in the groupware and management space. Their overseas staffs are actually getting better, but they're still taking longer to complete projects and deliver milestones than is prudent in the marketplace.
It simply can't afford any more workers at their current revenue rate. Their only hope would be to merge with another IT company who could make the investments of personnel necessary. If they sell off chances are most of the products besides Linux wither and die.