KKR confirmed last week that it has closed a deal to acquire Canadian software company Corel. The private equity giant purchased Corel—which produces WordPerfect, CorelDRAW and several other apps—from private equity firm Vector Capital. The specific acquisition terms have not been disclosed, but rumors surrounding the deal point to a price north of $1 billion.
Corel was founded in 1985, one of the first large software companies aimed at capitalizing on growing personal computer ownership. The company had early success with its Windows-based CorelDRAW graphics software, but otherwise struggled to compete with Microsoft in its early years. Corel also faced a number of major setbacks over the course of its history, including an insider trading scandal, numerous patent disputes with Microsoft and two stock market de-listings.
However, Corel managed to stay afloat and has acquired a number of other firms and products, including WinZip, Roxio, Micrografx and InterVideo. The company’s latest acquisition, the Bellevue, Washington-based Parallels and its Parallels Desktop for Mac virtualization software, was widely lauded as an important step by Corel toward bringing itself into the modern software era. The company reports 90 million current worldwide users.
According to an internal e-mail from Corel CEO Patrick Nichols, there are no planned layoffs following the KKR acquisition. The e-mail also highlighted the potential offered by the acquisition’s infusion of capital to expand Corel’s existing businesses and fuel future acquisitions.
KKR was positive about Corel’s future potential following the announcement of their acquisition, with KKR director John Park stating: “Corel has differentiated itself by offering an impressive portfolio of essential tools and services for connected knowledge workers – across devices, operating systems, and a range of fast-growing industries. KKR looks forward to working together with management to drive continued growth across its existing platforms while leveraging the team’s extensive experience in M&A to deliver a new chapter of innovation and growth on a global scale.”
Publicly, Corel was equally enthusiastic, with a Corel spokesperson releasing a statement: “Today’s news is very positive for Corel’s products and its global teams, including those who joined through the acquisition of Parallels in December. Everyone at Corel remains excited about and committed towards the continued innovation and opportunities for growth from the Parallels products, technologies, and teams. Our offices around the world remain the same after today’s announcement. As a private company, Corel doesn’t share information on company size.”