Novell acquires SUSE for $210 million

Novell announced today that it has entered into an agreement to acquire SUSE LINUX, one of the world’s leading enterprise Linux companies, for $210 million.

According to a statement, the acquisition will expand Novell’s ability to provide enterprise-class services and support on the Linux platform, a free Unix-type operating system originally created by Linus Torvalds.

The transaction is subject to regulatory approval and the winding up of shareholder agreements. Novell expects the transaction to close by the end of its first fiscal quarter, January 2004.

‘Responding to customer demands for open, standards-based computing, Novell has been dedicated to a cross-platform vision for four years now, and Linux is an increasingly important part of that strategy,’ said Jack Messman, chairman and CEO of Novell.

‘The acquisition of SUSE LINUX will complete Novell’s ability to offer enterprise-class Linux solutions to our customers from the desktop to the server. No other enterprise Linux vendor has the operating system experience and the worldwide technical support capabilities that Novell will be able to deliver.’

The acquisition of SUSE LINUX will be seen as an important step in Novell’s efforts to accelerate enterprise adoption of Linux.

Novell began building solutions for Linux in early 2000, when it made its eDirectory technology available on Linux. In April of this year, Novell announced it would make all the services that run on its NetWare operating system run on both the NetWare and Linux kernels in the future with the full range of Novell’s worldwide technical support.

Novell today also announced that IBM intends to make a $50 million investment in Novell convertible preferred stock. In addition, Novell and IBM are negotiating extensions to the current commercial agreements between IBM and SUSE LINUX for the continued support of SUSE LINUX on IBM’s eServer products and middleware products to provide for product and marketing support arrangements related to SUSE LINUX.

Both of these agreements will be effective when the acquisition of SUSE LINUX by Novell is completed.

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