Corel Receives Proposal from Majority Shareholder

March 28, 2008

So who really owns Corel these days? It can get confusing. I’ll try to recap the ownership history as best I can remember and then I’ll bring you up to speed with what happened today. Keep in mind that I don’t work for Corel and I have no inside knowledge of what happened.

Back in the 1990s, Corel was taken public by then CEO and founder, Michael Cowpland. During the time the company was public, the stock price certainly had its ups and downs. There was a day in the late 90s (I can’t remember the exact timeframe) when the stock flew up to $44/share because of Corel’s involvement with Linux. The party didn’t last long and the stock dropped to under $1/share. In 2003, Vector Capital bought the company and took it private.

The idea was that Corel was damaged goods and that Vector would fix what was wrong and then take the company public again. In the spring of 2006, Vector did take the company public again at $16. Since Corel’s stock was made public, the price has never reached the release price. Just a few weeks ago it was selling for just under $7/share. It has since creeped up over $10/share.

Which brings us to today’s news. Vector Capital still owned 69% of Corel. Now they are making an offer to buy the rest of the company for $11/share. What does this mean for users of Corel’s software? Hopefully nothing, but I honestly don’t have any idea.

I do know that management has been more focused on some of the new products Corel has acquired recently and less interested in the products upon which the company was built, Corel Ventura and CorelDRAW. I don’t have any hope that Vector owning the company will give these important products more attention as they given’t give them any more attention when they previously owned the whole company.

Today’s announcement just leaves me scratching my head and asking “what’s next?” What do you think of this announcement?

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