Blum Capital Partners, which owns over five per cent of Novell's stock, has issued a strongly worded letter of protest about the company's performance.
In a regulatory filing Blum's directors called for greater cost cutting, the selling off of non-core businesses and a restructuring of the company's finances.
Other suggestions include selling the company's two private jets and laying off part of the R&D department, which is described as "overstaffed".
The investment company outlined its proposals in a statement, saying that Novell must address four key concerns:
- To reduce costs to an appropriate level necessary to operate all of its businesses profitability
- To divest non-core businesses
- To become a leader in Linux and identity management through joint ventures and selective acquisitions
- To optimise its capital structure to maximise shareholder value
"The predominant theme in this four-step plan is the employment of disciplined analysis in allocating capital," it added.
Blum has been in correspondence with Novell on this matter since June but has described the response as "terse, one-sentence correspondence".
The company is urging Novell to institute a $500m share buy-back scheme to boost the value of shareholders' assets.
A Novell spokesman said that the company always listened to its shareholders and is considering the correspondence.
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