Corel fuels Linux sell-off rumours

Corel will unveil a 'new corporate growth strategy' later this month, fuelling rumours that the Microsoft-backed software company plans to sell its Linux business.

Analysts believe that the troubled company will announce its renewed commitment to the graphics and office suite sector, and the sell-off of its Linux business. It is also expected to reveal details of its developments with Microsoft, which has invested $135m in the Canadian software house. A press conference is scheduled for 23 January.

Corel has been in financial trouble after a proposed merger with Inprise/Borland, which had $240m in cash reserves, was called off last May when Inprise shareholders balked at the terms of the deal.

In October, Microsoft announced plans to invest $135m in the company which had previously announced a strategy to port its applications to Linux - the operating system that is biting into Windows.

Corel has previously declined to provide full details of its relationship with Microsoft other than to say it would use the Redmond giant's .Net as a development platform to help it web-enable both its Linux- and Windows-based applications.

According to reports, Corel has previously indicated that its Linux product line could be sold off. The company is best known for its WordPerfect and CorelDraw applications.

A statement from Corel said: "Senior executives are in the final stages of reviewing the company's corporate strategy which is designed to better position [it] for long-term growth and profitability."