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November 22, 2010

First take: Novell gives up the battle

Attachmate snaps up firm for $2.2bn

By Steve Evans

Infrastructure software provider Novell has agreed to be acquired by privately-held Attachmate for $6.10 per share, valuing the deal at around $2.2bn.

Attachmate is owned by an investment group led by Francisco Partners, Golden Gate Capital and Thoma Bravo. As part of the deal Novell will also sell certain IP assets to CPTN Holdings LLC, a consortium of technology companies organised by Microsoft. The $450m deal is reflected in the price Attachmate is paying.

"After a thorough review of a broad range of alternatives to enhance stockholder value, our Board of Directors concluded that the best available alternative was the combination of a merger with Attachmate Corporation and a sale of certain intellectual property assets to the consortium," said Ron Hovsepian, president and CEO of Novell.

"We are pleased that these transactions appropriately recognise the value of Novell’s relationships, technology and solutions, while providing our stockholders with an attractive cash premium for their investment," he continued.

Novell’s future has been hotly debated for a while now, and the company turned down a bid from Elliott Associates in March this year at $5.75 per share, claiming that the deal undervalued the business.

The company labelled its latest financial results "disappointing", leading CBR’s Gary Flood to urge the firm to, "make a deal happen, make it happen fast, buy the damn yacht and let’s all move on."

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The new deal represents a 28% premium over Novell’s closing share price at the time of the rejected Elliott Associates offer. Attachmate Corporation plans to operate Novell as two business units: Novell and SUSE.

You can read the full release here.

CBR will have more on this deal soon…

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