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Corel's Inprise Purchase Scuttled

May 17, 2000|Bloomberg News

Corel Corp. called off its proposed purchase of Inprise/Borland Corp. of Scotts Valley, Calif., a deal originally valued at $1.07 billion, after Corel's falling shares slashed the value of the agreement by two-thirds. Corel stock has plunged since the Feb. 7 agreement on concern that the company isn't making money from its push into software that runs on the Linux operating system. Corel had wanted to package Inprise programming tools for the Linux operating system with its own WordPerfect and CorelDraw software to help companies switch to Linux systems faster. The Canadian company reported a higher-than-expected loss in its latest quarter, and projected losses for the next two quarters. Cash-strapped Corel had planned to use Inprise's $239.7 million in cash to help it finance growth, and said it's exploring unspecified alternatives. Corel stock climbed 59 cents, or 11%, to close at $6 in Nasdaq trading. Shares traded at $20 before the merger was announced. Inprise stock climbed 28 cents, or 4.8%, to $6.13, also on Nasdaq.

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