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Novell to Buy Linux Developer SuSE

From Reuters

Business software maker Novell Inc. said it would buy Linux software developer SuSE Linux of Germany for $210 million, boosting the U.S. company’s hold on corporate networks and sending its shares up 21%.

Novell, based in Provo, Utah, also said IBM Corp., a major backer of Linux software, planned to make a $50-million investment in Novell convertible preferred stock, giving IBM a 2% stake in Novell, executives said.

The SuSE deal follows Novell’s $40.3-million acquisition in August of Ximian, a tiny Mexican developer of desktop Linux software.

Nuremberg, Germany-based SuSE, with annual revenue about $40 million, is Europe’s leading distributor of Linux, a family of software that gives developers open access to its underlying code. The closely held company ranks second among independent distributors of Linux behind Red Hat Inc. of Raleigh, N.C.

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Shares of Novell soared as much as 45% to $8.80 before settling back to close at $7.33 on Nasdaq, up $1.28, or 21%.


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