Troubled software vendor Novell Inc. wouldn’t comment on a growing
number of reports and rumors circulating Monday that the company is
about to lay off as much as 20 percent of its workforce as a way of
“Novell won’t comment on rumor or speculation,” Bruce Lowry, Novell’s
director of global public relations, said in an e-mail response to
In its most recent financial report, released Aug. 25, Novell reported
poor third-quarter results, with net income plummeting 91 percent to
US$2.1 million, while revenue fell 4.7 percent to $290.2 million. At
that time, Jack Messman, Novell’s chairman and chief executive officer,
did hint that further changes to the company’s structure lay ahead.
“While we were profitable this quarter, we still have improvements to
make in our business which will lead to cost reductions,” he said in a
Novell remains fairly cash rich with $1.6 billion on hand, according to the company’s third-quarter results.
The company has come under increasing pressure from one of its
shareholders, Blum Capital Partners LP, as made public in Novell’s 8-K
report filed with the U.S. Securities and Exchange Commission Oct. 4.
Blum has been pushing Novell to cut costs, spin off some of its
businesses and place more emphasis on its Linux software.
In one of his responses to Blum’s correspondence cited in the SEC
filing, Messman restated Novell’s position on its Celerant consulting
operation. “To reiterate, we envision Celerant being separated from
Novell in some fashion when market and other conditions are
appropriate,” he wrote in a letter dated Oct. 4. In the same letter, he
said that Novell didn’t intend to spin off either its GroupWise
collaboration software or its ZenWorks resource management software.
By China Martens – IDG News Service (Boston Bureau)