Corel Corporation is a Canadian computer software company headquartered in Ottawa, Ontario, Canada. It is known for producing software titles such as CorelDRAW, WinZIP, WinDVD, Paint Shop Pro and WordPerfect.
Corel was founded by Michael Cowpland in 1985, who intended it to be a research laboratory (“Corel” is an abbreviation of “Cowpland Research Laboratory”). The company had great success early in the high-tech boom of the nineties with the product CorelDraw (being one of the Three Killer Apps of OS/2), and became, for a time, the biggest software company in Canada.
Corel attempted to compete with Microsoft Word after acquiring the WordPerfect software title from Novell in 1996. Cowpland believed that WordPerfect could be the “Pepsi to Microsoft’s Coke”, as Microsoft Word was the top-used word processing software at the time. Corel’s job was made significantly more difficult due to Microsoft’s strategy to push pre-loaded copies of Word onto new computers.
A barrage of new projects followed the WordPerfect acquisition, including Corel Video, Barista (a Java-based document exchange format), Corel WordPerfect Suite For Java (an attempt to rewrite Corel’s software suite using Java), Corel Computer, and Corel Linux.
Cowpland eventually left Corel in August 2000 after surviving an Ontario Securities Commission probe, when he was accused of insider trading. A new board of directors was then appointed.
The new president, Derek Burney Jr., announced that the product line would be split into five brands. A few months later, it was to be three brands (DeepWhite, ProCreate and Corel). Finally it was decided that the company would go back to using “Corel” as the company’s only brand.
In October 2000, Corel announced that it was forming what it called “a strategic alliance” with Microsoft involving projects related to Microsoft’s .NET initiative, and that Microsoft would be investing $ 135 million in Corel by purchasing 24 million non-voting convertible preferred shares for $ 5.625 per share.
In late 2001, Corel acquired Micrografx, a competitor for users seeking graphics software.
In August 2003, Corel was wholly acquired by Vector Capital, a private equity firm, for $ 1.05 a share (slightly more than the cash in the company). The company was voluntarily delisted from the NASDAQ and Toronto stock exchanges. Some U.S. shareholders alleged the management benefited from the buyout personally while the buyout price was too low. A lawsuit was filed in the U.S. to stop the buyout and was unsuccessful.
In March 2005 Corel announced that the United States Justice Department purchased 50,000 licenses of WordPerfect (adding to the worldwide user base of 20 million) and that WordPerfect was adding 4 million new users per year thanks to bundling deals with Dell Computer. Corel contends that WordPerfect is the only viable alternative to Microsoft Office with sales 70 times Lotus’ SmartSuite and 300 times Sun’s StarOffice (though it isn’t compared against OpenOffice.org’s market share, which, according to its website, has had more than 100 million downloads.
On April 26, 2006, Corel completed its return to the public market with an initial public offering on NASDAQ, the same day finalizing the acquisition of WinZip, a well-known archiving software title.
In 2006, Vector Capital owned approximately 72% of the company.
On August 28, 2006, Corel announced that they will acquire multimedia software provider InterVideo for about $ 196 million.
On December 12, 2006, Corel announced that the acquisition of InterVideo and Ulead had been completed.
In May 2008, CEO David Dobson announced that he was leaving the company to take a senior strategy role at Pitney Bowes. Dobson was replaced on May 8 by former Symantec executive Kris Hagerman.
In November 2009, it was announced that Vector Capital would be purchasing the remaining shares of common stock in Corel Corporation. Upon completion, Corel will once again be privately owned.
On January 29, 2010, the shareholders of Corel approved its previously announced stock consolidation. The consolidation represented the second and final step in the acquisition of Corel by Corel Holdings, L.P., a limited partnership controlled by an affiliate of Vector Capital. Following approval of the Consolidation, Corel filed articles of amendment to effect the consolidation with the result that Corel is now wholly-owned by Corel Holdings.
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