Novell lands $2B takeover offer

By Mass High Tech staff

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Novell Inc. received an unsolicited offer Tuesday from private equity firm Elliot Associates LP, a company stockholder, to acquire the Waltham enterprise software company for $5.75 per share in cash, amounting to about $2 billion. Novell (Nasdaq: NOVL) has just over 347 million shares outstanding.

The Waltham-based open-source network software company confirmed the proposal in a press release Tuesday and noted that its board of directors would review the acquisition offer.

In a letter to the Novell board of directors, Elliot Associates noted its acquisition offer constitutes a 49 percent premium over its current value. Elliot owns about 8.5 percent of Novell common stock to date.

Novell share prices jumped 28 percent before trading this morning.

J.P. Morgan is serving as Novell’s financial advisor, with legal counsel coming from Skadden, Arps, Slate, Meagher & Flom LLP.

Novell’s 2009 annual report saw Novell’s network software business drop in its fiscal 2009, while its open source-based product line continued to make up a larger part of the company’s revenue.

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