Michael Cowpland, chief executive of Corel, has denied rumours the company is in talks with Linux kingpin Red Hat about a possible merger.
Cowpland claimed the Canadian firm did not need to unite with Red Hat to take advantage of the fast-growing market for the Linux Open Source operating system.
"Corel is very self contained in that it has all the applications, 50 million users and an OS that has already been very well accepted," he said, adding the company was not involved in any specific acquisition plans at the moment.
But shares in Corel rose almost 50 per cent last week after analysts and investors speculated that Red Hat was looking to acquire more software companies. This followed Red Hat's decision to buy Cygnus Solutions for almost $700m (£437.5m) two weeks ago.
But there has also been speculation that Red Hat is courting companies such as LinuxCare, a San Francisco-based reseller that provides services for firms using Linux.
Art Tyde, joint founder and executive vice-president of LinuxCare, said: "We have had some flirtatious discussions, but nothing of any substance."
But Rick Dalton, managing director at Broadview International, an investment banking firm, said: "There is no question that Red Hat is searching the highways and byways. Having a huge market capitalisation, which it does, it's only prudent to do what it is doing, and go out and use it to fill the gaps in the strategy and build a real company."
Dan Kusnetzky, an analyst at IDC, also pointed out Red Hat was in an interesting position. "With a market cap in excess of $10bn, we have a moment in time where it has enormous leverage. Red Hat could use it to make its business better," he said.
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