Corel, Inprise merger on track, executives say
By Mike Tarsala, CBS MarketWatch
Corel shares spiked 12 percent in Thursday trading, as executives from both Corel and Inprise, a company Corel said it planned to acquire in February, told investors that the purchase should go through as planned.
Questions over whether the acquisition would be completed arose earlier this week when Robert Coates, an Inprise board member, resigned his post Tuesday to protest the deal. Coates said in a statement that he will oppose the merger unless it results in substantially higher share prices for Inprise shareholders. He also wasn't convinced that the merger would benefit Inprise's customers.
Coates' opposition to the deal is significant, since he is one of the leading shareholders of Inprise, with about 3 million shares worth $32 million. Coates could not be reached for comment.
Executives at Corel's annual meeting in Ottawa, held Wednesday, told investors reassured investors that the merger was the right thing to to. Dave Fuller, Inprise's chief executive, spoke at the meeting, assuring Corel shareholders that most of Inprise's institutional investors support the deal.
If the merger is approved, Corel hopes to offer its Linux productivity application and other personal computer software along with Inprise's server-based development software and related services. Upon completion of the merger, Inprise will operate as a wholly owned Corel subsidiary, the companies said.
Corel plans to issue about 53.7 million of its shares to pay for Inprise's outstanding stock. Under terms of the agreement, Inprise shareholders will receive 0.747 Corel shares for each common share of Inprise. The distribution will give Inprise shareholders 44 percent ownership in Corel.
Shares of Corel rose 1 3/4 to 15 7/8 Thursday. Inprise shares added 11/16 to 9 7/8. |
