From http://www.globetechnology.com/ . . . . .
Corel, Inprise in talks to adjust buyout deal
SIMON TUCK
Technology Reporter
Wednesday, March 22, 2000
Ottawa -- Corel Corp. and the California company it agreed to acquire last
month are in talks to consider adjusting the terms of the deal, sources say.
The talks, triggered by the release of Corel's devastating first quarter
results and the subsequent share price fall, have been held informally
following a special meeting late Monday of Inprise Corp.'s board of
directors.
"We were looking at the results and seeing if we could be of some help,"
said Inprise chairman William Miller, a business professor at Stanford
University. "There are a lot of conversations going on between Inprise and
Corel."
The possibility of Inprise shareholders giving the deal a thumbs-down
increased Monday after Corel posted an operating loss of $18.8-million
(U.S.) or 29 cents a share on revenue of $44.1-million during the quarter
that ended Feb. 29. That failed to meet analysts' expectations and, to make
matters worse, was delivered with the Ottawa software maker's warning that
it doesn't expect things to get better for the next two quarters.
Investors responded to Corel's results yesterday by selling off both
companies' stock. Corel shares fell $4.40 (Canadian) or 22.6 per cent to
$15.10 on the Toronto Stock Exchange, while Inprise shares tumbled an almost
identical amount on a percentage basis -- $1.94 (U.S.) or 22.2 per cent to
$6.78. -- on the Nasdaq Stock Market.
The two stocks' tandem performance yesterday may suggest the market believes
the deal will go through. However, Don Magie, a dissident Inprise
shareholder, said yesterday he has the support of about 10 per cent of
Inprise's shareholders and intends to sway the majority he needs to cancel
the acquisition. "I think I will kill the deal," he said.
Michael Cowpland, Corel's chief executive officer, said Monday that his
company has no plans to renegotiate the terms of the deal. He was travelling
in Asia yesterday and unavailable for comment.