Novell rejects “inadequate” takeover bid

Novell has rejected a $2 billion takeover bid from New York-based hedge fund Elliot Associates.

Novell rejects “inadequate” takeover bid

The offer of $5.75 per share was deemed “inadequate” and undervalues the value of the company, Novell said. Elliot already owns an 8.5% stake in the software manufacturer.

Private equity firm Blue Harbour Group, which has a 4% stake in Novell, backed the company’s refusal of the bid. In a release, the investment company said: “We agree with Novell’s management and board of directors that the company’s value significantly exceeds Elliott’s proposal.”

Novell said in a statement that its board of directors have now approved a review of “various alternatives”, and has hired JP Morgan to advise it. These include the possibility of a strategic partnership, stock repurchases or selling off the company as a whole.

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