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Stockhouse.com: Corel Shares Soar 40-46% on Speculation over Possible Linux, WordPerfect Sale

Jan 11, 2001, 17:59 (14 Talkback[s])
(Other stories by Kate Jade)

"Corel [CORL] [T.COR] shares and its posters were invigorated Wednesday after a The National Post article suggested the software developer is refocusing its energies on making a presence in the graphics market. Rumors abound that Corel is preparing to sell its Linux line and WordPerfect software. On the speculation, the interlisted stock enjoyed a healthy 40% jump in the U.S. to $3.13 a share, while in Canada, Corel nearly doubled, soaring more than 46% to close at $4.75 per share."

"Now helmed by president and CEO Derek J. Burney, Corel has slowly mounted a comeback. In 1999, the company renowned for its CorelDraw and WordPerfect software programs entered the then-red hot Linux market with its desktop version of the open source operating system. The move proved to be somewhat of a disaster in that consumers continued to use Microsoft's [MSFT] Windows program. To curtail rising costs and burgeoning debt, Corel slashed its workforce. A dissolved merger with Inprise/Borland [INPR] in May and the resignation of then-President and CEO Michael Cowpland in August only added to Corel's woes, until a white knight in the form of Microsoft arrived. Microsoft purchased a US$135 million, or 24.6% stake in the company and signed a strategic alliance with Corel to develop new web products for Microsoft's .NET platform initiative."

"Amid the turmoil of the last year, Corel's share price and its investors had suffered. But on January 8, the company announced it would unveil a "new corporate growth strategy," one that would stimulate long-term growth and return the company to profitability. The new business plan will be made public January 23."

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