Corel Goes Public – Again

Corel is a public company again.

The graphics and productivity software firm
went from public to private when it was purchased by Vector Capital Group, a
San Francisco-based venture capital firm in 2003.

The initial public offering of 6,500,000 common shares by the Ottawa,
Canada-based Corel is priced at $16.00 (U.S.) per share. The offering
includes 5,000,000 common shares to be sold by Corel and 1,500,000 common
shares to be sold by certain selling shareholders. The offering is expected
to close on or about May 2.

“The IPO isn’t a surprise at all. This is how Vector gets a return on their
investment,” Rick Altman, a longtime follower of Corel, told Altman runs the CorelWorld
conference, which is independent of the company.

“What’s far less clear is whether the IPO will be good for Corel customers.
I’m worried the company may get back in the same trap of playing to the
market instead of the community.”

Although Corel has maintained modest profits for the past five quarters,
Altman notes the company faces significant competition from the likes of
Microsoft and Adobe.

He thinks its greatest opportunity is to continue to
produce solid upgrades and improvements and carve out niche opportunities
that complement products such as Microsoft’s PowerPoint.

“If they go back to thinking they have to outperform Adobe or Microsoft,
it’s very hard to play ball at the level of companies that size,” said
Altman. He points to recent bundling deals with Dell for Corel’s PaintShop
Pro and an up-tick in PC bundling deals for Corel’s WordPerfect as positive

“And then you have PowerPoint users who don’t know that much about graphics,
who buy something like Adobe Photoshop for over $500. That’s a great
opportunity for Corel,” said Altman.

“The latest Corel license for Draw is
under $250 for a program that does absolutely everything a business user of
PowerPoint would need.”

Microsoft once invested in Corel, but sold it years
before the Vector acquisition.

“I think if Corel plays it right, they can play small and win
big by picking the right opportunities,” said Altman.

Corel CEO David Dobson, presided over the closing of the bell at the Nasdaq exchange to celebrate the company’s IPO trading under the symbol CREL.

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