Novell Dismisses $2 Billion Buyout Bid
Novell Inc. said it has dismissed a $2 billion buyout bid from investment firm Elliott Associates L.P., contending that the $5.75 per share cash proposal inadequately expressed the company's value and its growth prospects.
In rejecting the Elliott offer, however, Novell seemed to leave room either for a meatier offer from the investment firm or solicitations from other suitors.
In a statement, Novell said that its board has "authorized a thorough review of various alternatives to enhance shareholder value," including stock repurchase or cash dividend, strategic partnerships, alliances, joint ventures, or a "recapitalization and a sale of the Company."
Novell said that its openness to exploring financial alternatives "is in the best interests of the Company and its stockholders."
The vendor said that it will not provide any further information on its options until its board approves a course of action.
Elliott, an institutional holder of 8.5 percent of Novell's common stock worth about $120 million, made a play for the company earlier this month, in an offer that represented a 20 percent premium over the company's closing stock price of March 1, 2010.