by CIO Staff

Novell Sells Off Consulting Business

May 26, 20062 mins

Novell this week sold its stake in Celerant Consulting for US$77 million to Celerant managers and U.K.-based investments group Caledonia Investments.

Novell acquired the consulting business through its 2001 purchase of Cambridge Technology Partners, when it also brought on Cambridge Technology President and Chief Executive Officer Jack Messman to head Novell. In November 2005, Novell said it was looking to shed the consulting business as part of a restructuring that involved cutting 10 percent of its workforce.

The sell-off will help Novell focus on its core businesses of Linux and open source, where it is struggling to gain market share from rival Red Hat, as well as on its identity management and security tools, and workgroup computing offerings.

Novell will outline the financial impact of the deal during its second quarter earnings call on May 31. Novell’s revenue last year was roughly flat from the year before, and the company’s first-quarter revenue of $274 million was down about 5 percent from the same quarter the previous year. Net income for the first quarter was $2 million, or $0.00 per share, down from $392 million, or $0.90 per share, for the previous year, which included a $448 million net gain related to a settlement with Microsoft.

-Shelley Solheim, IDG News Service

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