From: brian@SJF.Novell.COM (Brian Meek)
Newsgroups: bit.listserv.novell,comp.sys.novell
Subject: Novell signs letter of intent with AT&T to acquire USL
Summary: Novell Does UNIX!
Keywords: UNIX, SVR4, USL, Novell
Date: 21 Dec 92 19:08:03 GMT
Organization: Novell, Inc.

I thought this would be of interest to these news groups...

-- brian

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For Immediate Release:
Novell signs Letter of Intent with AT&T to ACQUIRE Unix system 
laboratories.
     Summit, N.J. -- December 21,1992 -- Novell, Inc. 
(NASDAQ:NOVL) and AT&T jointly announced today they have signed a 
letter of intent for Novell to acquire UNIX System Laboratories.  
USL is a subsidiary of AT&T that provides computer vendors with 
the UNIX operating system and related software and services based
on open, international standards for computing and communications.
     Under the terms of the letter of intent, existing shares of 
USL common stock would be exchanged for up to 12.3 million newly 
issued shares of Novell common stock in a tax-free merger 
accounted for as a purchase.  Novell would issue approximately 
11.1 million shares of common stock to the current non-Novell USL 
shareholders.  In addition the outstanding USL stock options and 
other equity incentives would be exchanged for Novell stock, or 
options, or rights to acquire shares of Novell stock, all in 
accordance with the terms of USL employee plans and the definitive 
agreement.
     AT&T owns approximately 77 percent of the outstanding shares 
of USL.  Novell currently holds approximately 5 percent of USL's 
outstanding stock, and 11 other investors hold approximately 18 
percent.
     The signing of the letter of intent has been approved by the 
boards of directors of Novell and AT&T, but the merger remains 
subject to the approval of USL stockholders, regulatory approvals, 
the signing of a definitive merger agreement and other normal 
conditions to closing.  The acquisition is expected to be 
completed during the first calendar quarter of 1993.
     "Our support of UNIX systems, as evidenced by our earlier 
investment in USL and the joint creation of Univel, has been 
driven by the widespread use of UNIX at our customer sites and by 
our desire to work closely with our industry partners,"  said 
Raymond J. Noorda, president and chief executive officer of 
Novell.  "This acquisition is being done at the urging of 
customers who have asked us to support the UNIX system directly 
and integrate it more fully within the NetWare environment.  This 
reflects the growing importance of UNIX systems which are 
increasingly being used for rightsizing business applications on 
computer networks."
     Novell recognizes and values the importance of UNIX as an 
open accessible technology to OEM partners and customers around 
the world.  As part of Novell, USL's commitment to fair and 
neutral access to UNIX technology will not change.
     Robert M. Kavner, AT&T group executive for communications 
products, reiterated what the company has said since 1991 that 
AT&T intended to reduce its ownership in USL, but that AT&T 
remains firmly committed to the UNIX system.  "Associating USL 
with Novell, another strong company, will allow USL to be an even 
more effective and flourishing force in the software industry," 
Kavner said.
     Roel Pieper president and chief executive officer of USL 
said, "The two best technologies for open systems and 
interoperability are coming together within one company.  The UNIX 
system provides reliable, secure sophisticated capabilities for 
network computing applications.  The NetWare environment provides 
integrated cross-platform system services.  The combination of the 
two enables distributed computing solutions to be deployed simply 
and cost effectively from desktops to mainframes."
     USL will become a wholly owned subsidiary of Novell, 
maintaining its operations in Summit, New Jersey.  USL was formed 
in 1991 around AT&T's UNIX Software Operation which had its roots 
in AT&T Bell Laboratories.  Annual revenues are in excess of $80 
million.
     In April 1991, AT&T sold a portion of its total interest in 
USL to a number of computer industry concerns.  AT&T said then it 
took that action to ensure the growth of UNIX System V and open 
operating systems by establishing an independent unit with 
business oversight by investors who would ensure that USL was 
operated for the good of the industry as a whole, along with 
technical input on product directions by other industry groups.
     Other USL investors are:  Amdahl Corporation, FUJITSU, 
Limited, ICL Plc., Institute for Information Industry, Motorola, 
Inc., NEC Corporation, OKI Electric Industry Co., Ltd., Ing. C. 
Olivetti & Co. S.p.A., Sun Microsystems, TATA Consultancy Services 
and Toshiba Corporation.
     The proposed transaction would be accounted for as a 
purchase.  On this basis, the acquisition could result in a one-
time write-off by Novell of up to $250 million in the fiscal 
quarter in which the transaction closes.  Most of the remaining 
cost of the purchase would be amortized over five to fifteen 
years.  The Novell shares required for the transaction will 
represent approximately 4 percent of the outstanding shares of 
Novell common stock.
     For AT&T and other USL shareholders the exchange of shares 
within the proposed transaction will be tax free.  Based on 
current Novell stock price, AT&T would expect to recognize a gain 
at the time of closing in excess of $100 million in net income.
     When the acquisition is completed, AT&T would hold 
approximately 3 percent of Novell's common stock.  Kavner 
emphasized that AT&T viewed its holdings in Novell as an 
investment and that AT&T had no plans to be involved in USL or 
Novell's operations or business decisions.
     USL develops and markets the UNIX System V operating system, 
the TUXEDO Enterprise Transaction Processing System and other 
standards-based system software products to open systems computer 
vendors worldwide.  USL also provides education and management 
consulting for UNIX systems and related technologies.
     AT&T is a global communications and computer company, with 
total 1991 revenues of $63.1 billion.  It operates the world's 
biggest and most advanced long distance network and provides 
communications services and products, as well as network equipment 
and computer systems, to businesses, consumers, telecommunications 
service providers and government agencies.
     Novell, Inc. is an operating system software company and 
developer of network services and specialized and general purpose 
operating system products, including NetWare and UnixWare 
products.  Novell's NetWare network computing products manage and 
control the sharing of services, data and applications among 
computer workgroups, departmental networks and across business-
wide information systems.

Novell, Inc  Peter Troop  408-473-8361
AT&T  Dick Gray 908-221-5057
UNIX System LaboratoriesLarry Lytle 908-522-5186

___________________________________________________________________________
Brian Meek                            Novell, Inc. -- Desktop Systems Group
                                      Internet mail:  brian@Novell.COM
Newsgroups: bit.listserv.novell