Sale of Ailing Novell Is Still an Open Book

A persistent rumor at last week’s Comdex computer trade show in Las Vegas was that Novell Inc., the troubled computer network company and one-time Microsoft archrival, would soon be sold. Among the potential buyers most often mentioned were IBM, Hewlett-Packard, Netscape Communications and AT&T.;

None of the companies, including Novell, would comment on the rumor. However, Novell Chairman John Young, who’s been running the Utah software outfit since Robert Frankenberg’s departure in August, would like to unload the company and its seemingly intractable problems, sources said.

Young, a retired Hewlett-Packard chief executive, is said to be eager to return to his role as a computer industry statesman.

Of the potential purchasers, Netscape, locked in a pitched battle with Microsoft for dominance in Internet software, appears the least likely. Netscape chief Jim Barksdale fears any move that could distract his fledgling company. Novell represents a cautionary tale for any company considering a frontal assault on Microsoft: Former Novell chief Raymond Noorda’s decision to take on Microsoft in a variety of product areas severely damaged the company.

At a recent stock price of about $10 a share, Novell is something of a bargain. It still has a dominant, albeit rapidly shrinking, share of the market for computer networks. But it has been slow to incorporate the Internet into its product plans.