Corel and Parallels acquired by KKR for 1 billion dollars

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The American investment company Kohlberg Kravis Roberts & Co (KKR) acquires software company Corel. The investment company is said to have concluded an agreement of more than USD 1 billion with owner Vector Capital.

TechCrunch says it has laid its hand on an internal memo in which KKR expresses optimism about Corel’s prospects. The memo confirms that the deal has indeed been concluded and that Corel is now officially part of the KKR family. The takeover would not be accompanied by layoffs and the official announcement would be made on Wednesday 3 July.

Capital injection

KKR wants to give Corel a capital injection to accelerate its growth. First, the activities for the existing company will be expanded to include a number of old software brands owned by Corel. Think of WordPerfect, Corel Draw, WinZip and PaintShop Pro.

In addition, a number of acquisitions are also planned, including those of promising start-ups. Young players who have developed a variety of apps and other software that are interesting to Corel over the past decade, but for whom there has been no increase in scale up to now. Six months ago, Corel acquired virtualisation specialist Parallels itself. This company will now also be under the umbrella of KKR.

USD 300 million in dividends

Although Vector Capital and Corel themselves have never revealed much about user numbers or financial data, Vector has described the company as highly profitable. For example, there would be dividends in excess of USD 300 million today. Millions of customers would also use Corel’s various software platforms and apps, including Parallels.

In the 1980s, Corel once placed itself as a potential competitor for Microsoft in the software wars. When the company bought WordPerfect from Novel in 1996, Corel founder Michael Cowpland considered the software package as an integral part of its rivalry with Microsoft. He described it as the Pepsi for Microsoft’s Coca-Cola i.e., Microsoft Word. The two companies have talked about different patents, but in the end Microsoft turned out to be the most powerful of the two.

Parallels

In recent years, Corel has focused on modernising its offer. The acquisition of Parallels was part of that strategy, as this company’s solutions help people work seamlessly across multiple platforms. This allows employees and IT managers to execute a uniform workflow, regardless of the device or operating system. Parallels supports Windows, Mac, iOS, Android, Chromebook, Linux, Raspberry Pi and cloud.

This news article was automatically translated from Dutch to give Techzine.eu a head start. All news articles after September 1, 2019 are written in native English and NOT translated. All our background stories are written in native English as well. For more information read our launch article.