Company News

Novell Chief Executive Adds Chairman's Title

Lawrence M. Fisher
The New York Times

August 13, 1994

Novell Inc. said today that Robert J. Frankenberg, who was named president and chief executive in April, had added the title of chairman.

Mr. Frankenberg succeeds Raymond J. Noorda, who turned Novell from a struggling start-up into the leading networking software company. Mr. Noorda will remain on the company's board.

The succession had been anticipated, although most analysts had expected Mr. Noorda to remain chairman longer.

Mr. Frankenberg, 47, a former executive of the Hewlett-Packard Company, joined Novell shortly after Mr. Noorda engineered the acquisition of the Wordperfect Corporation and the Quattro Pro spreadsheet business of Borland International Inc. Those deals, and previous acquisitions, have made Novell a direct competitor of the Microsoft Corporation.

Shares of Novell closed at $15.25, down 31.25 cents, in Nasdaq trading today. Analysts said the change in chairmen would have little impact on the company's future, which was already in Mr. Frankenberg's hands.

"I think Frankenberg has a firm grasp of the reins now," said Richard Sherlund, an analyst with Goldman, Sachs, adding that he expected Novell to announce a restructuring and a reduction of 1,000 to 1,500 in its work force when it reports earnings on Aug. 24.

"I think he has a real challenge in executing on Ray Noorda's vision and the acquisitions of Unix Systems Labs, Digital Research and, most importantly, Wordperfect," Mr. Sherlund said. "It's a significant challenge to integrate, reduce costs and get these to work."

But Mr. Noorda, in a statement, expressed confidence in his successor. "In the four months since Bob joined Novell, his perspective and leadership have given timely focus to the strengths of our increasingly diverse organization," Mr. Noorda said.

Acquisitions Criticized

Analysts had been critical of Mr. Noorda's acquisitions, saying they had made the company more vulnerable to Microsoft and had diverted management's attention when the company's core product, Netware, was having difficulty in the market.

Before joining Novell, Mr. Frankenberg was briefed on the Wordperfect deal while it was still being negotiated. He has said he supports Mr. Noorda's strategy.

Mr. Frankenberg repeated that sentiment in his statements today.

"Few others have had the consistency of vision as has Ray," he said. "What he brought to the company in 1983 -- an understanding that all information resources would ultimately reside on networks -- is understood today by our entire industry."

Photo: Raymond J. Noorda, left, stood outside Novell's offices in San Francisco in April with Robert J. Frankenberg, who succeeds him as chairman. (Jim Wilson/The New York Times)

Copyright 1994