Novell shuns 'inadequate' takeover bid

Novell would rather sell off the company than accept an "inadequate" bid from investment firm Elliot Associates, the company has said.

Elliott Associates offered $2 billion for the open source firm, but Novell's board said - after "careful consideration" - that the bid was "inadequate and that it undervalues the company's franchise and growth prospects."

The board said it would rather look to alternatives to get more value for its stockholders, including selling off the company.

The investment firm agreed that's the best move. "We welcome the Board's decision to conduct a sale of the company, which we believe is the best way to maximise shareholder value," Elliott Associates said in a statement.