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The Register: How old chums cobbled up the MS Corel deal

Oct 04, 2000, 18:56 (4 Talkback[s])
(Other stories by Graham Lea)

"There are several theories as to why Microsoft did a deal with Corel, but neither a Linux-based liaison nor assuaging antitrust concerns stand up to serious examination. On the antitrust front, Microsoft is probably more concerned about its PR image vis-a-vis the punters than the court of appeals. There are some clues about the real reason for the apparent chumminess if we look at how the deal came about - and especially at what remained unexplained after the analyst call."

"Following former CEO Mike Cowpland's resigation in mid-August, Microsoft's developer division general manager Tom Button emailed Derek Burney to congratulate him on being made interim CEO/president. (Not surprisingly, the Corel board confirmed his appointment yesterday.) The two had had a working relationship since they worked on a licensing deal. Burney's response resulted in an invitation to Redmond and a brief .NET briefing, with the result that the Microsoft investment was hatched."

"Curiously, Microsoft's 10 per cent stake in Inprise/Borland would have given it a stake in Corel earlier, had that merger gone ahead. From Microsoft's point of view, the departure of Cowpland was important, since he had proved to be an implacable opponent, which begs the question as to whether there had previously been hints about Microsoft's desire for a deal, if Cowpland stood down. Ironically, Cowpland is one of the big winners from the deal, in view of the size of his shareholding."

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