Novell Deals Done

As expected, the buyout of Linux power Novell by Attachmate has finally gone through. On April 27th, Attachmate acquired Novell for $6.10 per share in cash--approximately $2.2-billion. With this deal completed, Novell is now a wholly owned subsidiary of The Attachmate Group, the parent company of Attachmate Corporation. Immediately prior to the merger Novell completed it's "previously announced sale of certain identified issued patents and patent applications to CPTN Holdings LLC for $450 million in cash."

According to the company, "As a result of the merger, Novell's common stock will cease trading on The NASDAQ Global Select Market at the close of business on April 27, 2011, and Novell expects to de-register and suspend its reporting obligations. BNY Mellon Shareowner Services has been appointed to serve as the agent for payment of the merger consideration to Novell's stockholders, and will promptly mail to stockholders of record instructions on how to surrender their stock certificates and receive payment for their shares."

Attachmate has attempted to assure Novell customers and openSUSE users that it will be business as usual under the new regime. One interesting change though has already popped up, according to the Attachmate Group site, Novell and SuSE will be separate companies. Novell acquired SuSE for its Linux operating system in 2003.

Attachmate, which started as a terminal emulation company in 1982, is privately held. Its primary owners are the private equity firms Francisco Partners, Golden Gate Capital and Thoma Bravo. Today, the Attachmate side of the company still works in X Window and terminal emulation. Its other half, NetIQ, sells and services systems and security management software. It would seem Novell will continue to sell the company's directory services and IT management programs, while SuSE will continue to focus on Linux.

What this will mean for the management of these re-seperated groups is an unanswered question at this moment. One would presume that they'd each have their own executive teams.

The Attachmate/Novell deal could have not have been made without Microsoft's help. Attachmate, a rather sleepy company over the last decade, simply didn't have the resources to buy Novell.

Directly speaking, Microsoft, with the help of its partners, Apple, EMC, and Oracle, in the CPTN Group has not, though, actually bought Novell's patents as most people would understand the word "bought." Instead, CPTN was forced, by the U.S. Department of Justice and the German Federal Cartel Office to re-sell the patents back to Attachmate. In return, the CPTN gets licensing rights to use the patents.

For Microsoft and friends, the most vexing part of the deal is that All of the Novell patents will be subject to the GNU General Public License, Version 2 (GPLv2) and the Open Invention Network (OIN)patent-pool agreements. In other words, Microsoft can't use these patents against Linux or other open-source programs.

Now that the deals are done, we'll have to see if Attachmate lives up to its promises to keep supporting Linux. Since Novell's-excuse me-SuSE's main business is Linux, I can only hope that this will be the case. If not, well Red Hat and Canonical, Ubuntu Linux's parent company, will be glad for the business.

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