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03 March 2010, 09:32

Hedge fund makes bid for Novell

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Hedge fund Elliott Associates LP has made an unsolicited bid to acquire Novell. The bid from Elliott Associates, which values the SUSE Linux and identity management business at around two billion dollars, comes after the recent announcement of weaker overall revenue for Novell's last quarter. The offer values the company at 21% more than Novell's Tuesday closing stock price.

In 2008, Elliot Associates LP, which manages around $16 billion of funds, made an unsolicited bid for Epicor Software, which was ultimately unsuccessful. Elliott says that it believes Novell's stock has "meaningfully underperformed all relevant indices and peers". Elliot already owns 8.5% of Novell, and SEC rules require that, with that level of ownership, it make the bid public. Novell has confirmed receipt of the bid and says that its board "will review Elliott's proposal in consultation with its financial and legal advisors".


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