Novell's Stockholders approve Attachmate buyout but the Deal's far from done

If Novell stockholders have their way, the company will soon be sold to Attachmate, but anti-trust proceedings from Germany and the U.S. still stand in the way.
Written by Steven Vaughan-Nichols, Senior Contributing Editor

Last week, Novell announced that its stockholders have voted to adopt the previously announced merger with Attachmate and Longview Software Acquisition Corp., a special purpose vehicle formed by Attachmate designed to acquire all of Novell's stock. The deal is still far from done though.

Novell, which as Pamela Jones of Groklaw points out now describes itself as "the leader in intelligent workload management," instead of the producers of "best engineered, most interoperable Linux platform.," still faces anti-trust inquires from both the German Federal Cartel Office and the U.S. Department of Justice.

Neither of these agencies are concerned about Attachmate a formerly obscure software company buying Novell with Microsoft financing. No, the governments; concerns are about Novell's patents landing in the hands of CPTN Holdings-a company made up of Microsoft, Apple, EMC and Oracle.

For Attachmate to end up with Novell, the patent deal must go through. If Microsoft and friends don't end up with the patents because of government intervention then the Attachmate deal is dead. Or, as Novell explains it: "The patent sale to CPTN remains subject to the satisfaction or waiver of closing conditions, including receipt of antitrust approval in the United States and Germany. As previously disclosed, Novell and CPTN received a request for additional information from the Antitrust Division of the United States Department of Justice regarding the patent sale. The requests have the effect of extending the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 until 30 days after both parties have substantially complied with the requests, unless the waiting period is earlier terminated. Novell is in the process of gathering information to respond to this request and is continuing to cooperate fully with the Department of Justice in connection with its review. Novell continues to work toward completing the merger as quickly as possible and currently anticipates that the closing of the merger will occur following the completion of the waiting period and the satisfaction of other closing conditions."

If and when the deal goes through, Novell stockholders will be entitled to receive $6.10 in cash for each share of Novell common stock held by them. At the moment, early afternoon Eastern Time February 22nd, Novell stock is going for $5.94 a share. The deal could take months to make its way through the regulatory forest. In the end, though, I believe it will be approved.

In the meantime, Novell, which supplied SUSE Linux for IBM's Watson Jeopardy champ and the London Stock Exchange, is going back to business as usual. For example, the company recently announced that its well-known BrainShare trade show is on schedule again. It will now be held on October 10th to 14th instead of its usual early spring date. If Novell has its way, by then the Attachmate/Novell merger will have been completed.

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