Novell to acquire SuSE Linux

In a move that has been rumoured for months, Novell has announced that it has entered into an agreement to acquire SuSE Linux, a leading supplier of the open source Linux operating system to enterprise customers. Novell has agreed to pay US$210 million in cash for SuSE, although the move is subject to regulatory approval and the winding up of shareholder agreements, according to the statement. This move follows Novell's August purchase of Ximian, a provider of Linux server and desktop software. Novell also announced that IBM plans to make a $50 million investment in Novell convertible preferred stock. In addition, both companies are negotiating extensions to the current commercial agreements between IBM and SuSE for the continued support of SuSE Linux on IBM's eServer products and middleware products. Last week, Richard Seibt, chief executive officer of SuSE, refused to confirm rumours of a possible takeover by Novell, saying only that "there are lots of rumors out there, and there will be many more. We're doing well, and that attracts attention."