Corel - Inprise/Borland Merger Off

hwestiii was the first to e-mail with the word that the oft-troubled merger between Corel and Inprise/Borland has been called off. The press release has made its way onto Yahoo! so far, with the given reason being the decline of Corel's stock price making the deal impossible to close.

Comments

Reality check on Corel's value

[dublin]

Discalaimer: I own some Corel stock (which I could sell today and still make a decent profit...)

There's a lot of Corel bashing going on here. Some of it is deserved (the company is no shining beacon of management success), but Corel stacks up well against many of the current darlings of the industry. This is not a cheerleading attempt for CORL, but an attempt to point out how badly values are out of line with fundamentals across the software industry right now.

(Further, it surprises me that Corel is so villified here on /. - they are the primary commercial proponent of what is arguably the most "pure" Linux flavor - Debian.)

Let's take a look at Corel (CORL) relative to some of the more favored stocks in the Linux space, say Red Hat (RHAT), VA Linux Systems (LNUX), and Caldera (CALD):

First, a very important distinction: although Corel has cash problems, the company *is* making money, unlike any of the others above. This means it actually has a P/E ratio (curently 17.44 as I write this), unlike the others. That's beacuse CORL actually has some earnings per share:

CORL: +0.31
RHAT: -0.10
CALD: -0.79
LNUX: -1.68(!)

This is called fundamental value, and is the main reason that even if Corel gets strapped for cash ( as is becoming increasingly likely) that someone is likely to step in and buy them out, simply because they are a very good deal.

Now for a look at market cap:

CALD: 382M
CORL: 386M
LNUX: 2064M
RHAT: 3099M

Notice that Caldera has nearly the same market cap as Corel, in spite of the fact that they are losing money like crazy and also unlike Corel, have no established customer base, no established large-scale development organisation, no established large scale technical support organisation, and no distribution channel to speak of. These things matter! They are the things that distinguish a true going concern from one that has merely managed to get a huge IPO pop. The same is true of the others, even though their market caps are much larger. (Exercise for the reader: so which is really worth the most?)

Finally, whether it's to your tastes or not (I prefer Caldera, but that's beside the point) Corel has done a pretty good Linux distro - one which has achieved the significant accomplishment of taking Debian (which is technicaly excellent but had a well-deserved reputation for being a nightmare to install and configure) and making it quite easily usable by mere mortals. For a 1.0 release, I think the product is quite good - better than comparable first efforts from any of the other major distros.

Bash Corel if you want, but recognize that in the real world, where the rubber meets the road - Corel has things that the big market cap guys are still dreaming about. Little things, like paying and loyal customers, that some of us contrarians believe could be important over the long haul...

Corel needs to learn their place.

[Mr T]

I'm not going to bash Corel by pointing out their stellar mgmt. It's been done. I will say that they could do a lot more if they had some vision and took WP to the next level, they are enjoying the code base and its legacy and not driving it ahead. That will catch up with them, WP ran the world 10-15 years ago but it needs something new if they want to keep kicking it. If nothing else, make it a little more pleasing to the eyes, it is a WYSIWYG type product but the whole thing feels and looks like it did 10 years ago. (yeah, I like gloss. We know WP works, gloss is what it lacks, I have a hard time paying money for an ugly looking program when looking at it is a large portion of its use. Besides gloss, WP is basically the same app it was 10 years ago though)

What I am going to bash them on is their approach to the community. I really don't see any place for Corel Linux. They did some of the right things with it, I appreciate their support of Debian, but Corel isn't an OS vendor and I'm not sure how it fits in to their business model. It seems like a lot of redundant effort for them to build a dist, market it, and support it unless they are going to provide some value-add and that's the part I don't like. For Corel, or Caldera too for that matter, value-add is something that doesn't give me a warm fuzzy feeling, it feels like something that is non-standard and it feels like the beginnings of an MS style embrace-extend attack. With Corel, I partially think building their own dist was a way for them to show their committment and create a revenue stream but it just doesn't fit in with the community and it looks a lot more like them getting one of the "need pieces." I see their acquisition of Inprise the same way, it was just another way for them to get the pieces they need to be another MS. MS beats them because they control the platform, so Corel makes their own platform. MS beats them because they control the tools so Corel buys a tool vendor (inprise.) Totally ignoring the fact that MS is thousands of times bigger and has the infrastructure to run that kind of business, and even MS puts out buggy code and misses deadlines and can't really run the business well.

Corel is putting out good linux apps, mainstream apps, apps that get attention and make Linux a more viable platform to more people. They are making an investment in Linux and they should be applauded for that. But if they really want to support the community and do the "Right Thing" I think they should focus on building better apps, start innovating again (?have they ever?) and sure that up. I see no reason at this point for them to acquire inprise other than to "control" more linux software. They need to give up that notion of control.

I also think this will be good for Borland. Borland is making a natural transition to Linux. They are slowly understanding it, supporting it and growing to embrace it. That is the correct course for them, I suspect that a Corel merger could result in a Linux mandate. Borland's support will be much better and stronger as they gradually grow to see that they need Linuxand that they have no choice other than to support it. That is far better than ordering them to do Linux. I'm all about compilers too, I'd love to see IBM's, SGI's, and Borland's compilers all running on Linux, I love gcc but I love having alternatives, I just think the results will be better if Borland grows into Linux rather than jumps in head first. (I own a copy of their OS/2 BC++, I know what the results are when they do that.)

SlashDot - The world of 'Non individuals'

[cybrthng]

Wasn't it just 2 days ago when everyone cried wolf how the new Unreal Engine is DX8 Based and then the sun was shinning as people stated Wine will/has support for DX subset.

Did you forget Corel is the biggest supporter of Wine and dedicates developers full time to that project?

Ever wonder how it is becoming so easy to integrate KDE 2.0 and Windows/NT machines through SMB

Did you forget Corel is the biggest linux vendor working on linux integration with Windows? They were the first to implement SMB in the gui with a library and they're happily and non hastily following the license and passing along the code to KDE developers.

Ever wonder how Debian is getting alot of publicity?

Did you forget Corel linux is based on Debian? The standard for the non standard linux?

How can you consider Corel to be riding "The Linux Bandwagon" When Corel is one of the FEW, if the ONLY vendor producing a commercially viable and professionally packaged versions of the Linux OS for WORKSTATION and PERSONAL USE.

Corel doesn't claim to be the server centric sun ball busting software. They do claim ease of use and with that comes the unleashed power of a unix based system.

A full office package, a great v 1.0 integrated and effecient OS, a full distribution and support and retail channel that reaches from the internet to the local software store. And all you can do is bash them?

BORLAND oth has been nothing but a dissapointment and i'm glad they didn't mix. Delphi is good, but pascal is the last thing that needs to be mixed in with linux. and i highly doubt Borland would be much of an adopter of the KDE/Gnome interface and interope with the right people to do what linux people think is right.

Please stop shooting yourself in the foot and crying fowl just because of what the common notion is. I'm so sick of people not thinking for themselves. It seems to be the whole linux bandwagon is an extremest advocate gone afoul. While for some people it is the perfect solution, on the other hand, its only confused the industry that has created it and is the first to cry foul when someone doesn't follow the unwritten rules and justices of the "linux" system.

Corel's future.

[Matt2000]

As has been mentioned before, Corel has roughly 5 months of operating capital in the bank, and needed the merge most immediately to acquire Borland's cash reserves.

So here's the situation: Little money left, a ways to go before their Linux investment pays off (even longer without the merger), declining market share in core products like Draw, stagnant sales in Word Perfect office.

Did I miss anything? Maybe this will destroy the part of Corel's brain that contiually wants to compete with Microsoft in their core areas, and get them to focus on something that might make some money.

Hotnutz.com - Funny

A couple of thoughts.

[Amphigory]

First: Woo hoo! I really don't think that Borland and Corel were really well suited to each other. Borland has a tradition of excellence. Corel... Well, Corel has just never managed to put out a product that made my jaw drop.

Second: I think this is a really good thing for the Linux community. Borland (I refuse to call them inprice) has a tradition of producing excellent development tools. I don't see how the merger with Corel could have done anything but drag them down. I think that Linux's great hope lies in a lot of different vendors, each of which are the best at what they do, not one huge Microsoft-esque vendor that provides everything. We don't need it: let's define standard formats and mechanisms for application interoperability, and let all the vendors (open source, closed source, whatever) duke it out for market share. Now THAT's innovation.

Hopefully, this announcement will not affect Borland's interest in developing for Linux.

--

It's funny

[toofast]

But reading all the posts in here, manu people seem upset at Corel, and accusing them of producing low-quality software.

I've been using WP 2000 on Linux for a while, and it's been a breath of fresh air. Runs smooth, doesn't crash, and allows me to stay in Linux when I need a spreadsheet.

I'm beta testing DRAW and Photopaint for Linux. I use PhotoPaint a great deal, and again, I no longer need to boot Windows to use PhotoPaint.

Corel are delivering quality apps _ON TIME_. no shipping delays. No waiting 3 freeking years for a product. No 190 MB service Pack!!!

I agree that they are following the Linux bandwagon, but what's a company to do? How do you compete with Microsoft??? Everyone who does dies. Linux is Corel's only hope, and as a Linux community, let's praise what Corel are doing. They're giving us good APPS, and at a more-than-reasonable price. I'm sorry, but Gnumeric is just to simple and featureless to consider using.