clock menu more-arrow no yes

Filed under:

WOULD IBM-NOVELL MERGER BE A BAD MARRIAGE?

When David Coursey, editor of P.C. Letter, suggested in the July issue that IBM might buy Novell Inc., he was just kidding.

Thursday, in a telephone interview from his offices in California, Coursey said it isn't really a funny thing to contemplate.Coursey was responding to rumors put over the airwaves by CNBC financial correspondent Dan Dorfman that implied the buy was in process or nearly done.

"IBM is as clueless as the day is long," said Coursey. "It would be a really strange thing."

Coursey has long said Novell is in a downward spin, not stopped by its purchase of WordPerfect Corp. in March 1994.

"Novell has some serious trouble. The question is whether it would help them to merge with a company with troubles of its own," Coursey said.

"Does this in any way help anybody?"

Coursey said there's no question in his mind that talks between the two computer industry giants have been taking place. He really wouldn't be too surprised to see an announcement of consummation come out but he doesn't believe it's a sound idea.

"If it were about to happen, I wouldn't necessarily know. Nobody would. It would just happen. That's how it's done. Boom."

Coursey said such a merger would definitely be done for the benefit of the Novell stockholder. Novell stock has never regained the stature it had before the acquisition of WordPerfect.

For IBM, it would bring net-working applications and Unixware to a company desperate for a shot in the arm, he said. "IBM is in the death throes.

"The question is, what's left to benefit the customer?"

Dorfman, on the Thursday morning CNBC broadcast, predicted an "IBM-Novell wedding." Dorfman pointed to a sudden rise in stock value that gave fuel to the "abounding rumors" that IBM is about to make a bid of $28 per share or $10.3 billion for the Provo-based company.

Novell's stock closed Wednesday on NASDAQ at $19 per share, up 311/4 cents.

Dennis Morgenson, public relations spokesman in Orem for the Novell Applications Group (formerly WordPerfect), said he knows nothing of any decisions involving IBM.

"Of course, IBM's policy is not to comment on speculation and Novell's policy is not to comment on rumor, so what do you have?" Morgenson said.

Public relations sources in San Jose, Novell's corporate headquarters, did not return phone calls Thursday. Several employees contacted were also unaware of an impending change in ownership.