Novell will be asset stripped
Submitted by srlinuxx on Fri, 03/12/2010 - 09:51
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.
Novell Won’t Go to Pieces
thevarguy.com: A report by Bloomberg News suggested that Elliott Associates planned to buy Novell then potentially sell off some or all of the pieces. But a March 11 statement from Elliott Associates denied the report:
rest here
Also: Hedge fund suitor denies Novell asset sale rumors
Wiggle room
There's enough wiggle room in that statement to drive a bus through.
"Elliott has made no statement with respect to its intent regarding Novell."
Indeed. Bloomberg didn't claim it had. It attributed its story to an insider speaking anonymously. That's not a company statement.
"Elliott wants to own the company."
Doesn't mean anything.
"Elliott has no plans to sell any business units"
Doesn't mean anything, as it can never be invalidated. It's essentially impossible to ever 'prove' to a legal standard that when someone said they didn't have plans to do something, they actually did. 'Have no plans' is the standard line you use when you have plans but don't want to tell anyone about them yet. (Some companies also use it when they genuinely don't have any plans, just so the wheeze doesn't become too predictable in future).
"to report anything else would be erroneous"
Interesting phrasing. It sounds very definitive but really it means very little. It's transferring the burden to the report, and really says nothing about Elliot's intentions that it can't wriggle out of.
I have no inside knowledge (or much outside knowledge, I haven't been following it very closely) of this story, and this post has nothing to do with my employer. It just jumped out at me that Elliot's statement is nowhere near as emphatic as it seems at a superficial glance.
re: wiggle room
There's enough wiggle room in that statement to drive a bus through.
Yeah. I was thinking "you know them by their works" when I read it. Slash and burn is what Elliot does. Why would we expect anything else with Novell?
It's a shame. Shareholders want to sell. openSUSE is one of the few distros that can almost generate as much interest as "the one formerly known as brown."
Novl has $1.29b cash or equivalent current asset(annual report)
They are operating with much less cash needed, so rubber barons will take over and cash out each year thereafter.
Adam W's employer RedHat is basically JBoss business(apache tomcat and middleware object technology), not much Linux OS($150 million revenue per year of a much larger total).
Breaking up Novl will not benefit RedHat much.
We are Novl stockholders. Opinions here maybe biased.