* Novell divests itself of Celerant Consulting, which it inherited from CTP
A year ago, some major Novell investors recommended that the company divest itself of some products and services. The company has now at least started on that mission with the announcement that Celerant Consulting, a U.K. firm acquired by Novell with the Cambridge Technology Partners (CTP) merger, has been sold to a highly leveraged group of its managers with backing from U.K. investment firm Caledonia Investments.
Celerant was founded in 1987 as Peter Chadwick Holdings, a U.K.-based consultancy firm. In 1997, the company was acquired by CTP for £77 million (approx. $144 million at today’s exchange rates). In 2001, Novell paid $261 million for CTP. In what has all the appearances of a fire sale, Novell is getting $77 million for Celerant. That’s almost $67 million less than the cost of acquiring Celerant 10 years ago.
In fact, it’s reminiscent of the WordPerfect fiasco of 15 years ago when Novell sold off the applications that made up its abortive attempt to challenge Microsoft Office in the desktop productivity category. Still, as Celerant (and, for that matter, CTP) weren’t generating much in the way of revenue – or, especially, profit – it’s probably the best that can be expected.
The same investors that urged Novell to divest itself of Celerant also suggested that CTP should be put on the block as well as applications like GroupWise and ZENworks. Whether that will happen depends mostly on how much pressure the stockholders can bring to bear. Given the low price for Celerant, it doesn’t appear that anyone is knocking on Novell’s door to acquire pieces of its business.
Celerant calls itself an “operations management consulting firm,” with one area of expertise listed as “organisational alignment and effectiveness.” It claims that a balance sheet isn’t the best way to understand what makes a company tick. As its literature puts it:
“It’s unfortunate, then, that balance sheet performance is so often the starting point for those seeking to make organisational changes. The balance sheet may tell you that alterations to structure, reductions in headcount, the introduction of new systems and processes are all necessary, but it won’t tell you that they need to be addressed in the context of corporate and individual behaviour. Anything less than this runs the risk of becoming purely functional – a change that has only a partial effect on outcome, a change that doesn’t really change anything. You can switch a sprinter to new blocks and running shoes, you can even improve his technique – but if you don’t work on his attitude, he’s not likely to win.”
Perhaps Novell should have listened to the people at Celerant, rather than the stockholders.
