Novell Completes Acquisition of SUSE LINUX

FOR IMMEDIATE RELEASE 
Jan. 13, 2004

Novell Completes Acquisition of SUSE LINUX 
 
- Novell brings enterprise infrastructure to Linux, becomes market's largest
Linux vendor
- Novell worldwide technical support will help enterprises deploy Linux with
confidence 
- Completion of deal sets stage for $50 million IBM investment in Novell

PROVO, Utah - Jan. 13, 2004 - Novell today completed its acquisition of SUSE
LINUX, a combination that brings global technical support, consulting and
training services and industry-leading networking and security to Linux, and
provides a compelling alternative for companies wishing to leverage the many
benefits of open source. Novell now offers a full range of enterprise
solutions on the Linux platform, from the server to the desktop. The closing
of the $210 million cash deal also opens the door for completion of the $50
million investment of IBM in Novell announced November 4.

"Combining Novell's global presence and deep knowledge of enterprise software
with SUSE LINUX's powerful technology makes Novell one of the strongest
options for enterprise Linux literally overnight," said Jack Messman,
chairman and CEO of Novell. "Novell's customers have long asked us to back
Linux with our great networking software and technical support system. Now
we're going even further - offering one of the top Linux distributions on the
market. Customers interested in deploying Linux - whether in the data center
or on the desktop - can now turn to Novell to get what they need."

SUSE LINUX becomes a product business unit within Novell with its sales and
marketing handled by Novell's existing geographic business units and SUSE
LINUX's current sales and marketing staff. Novell will keep the strong SUSE
LINUX brand. While SUSE LINUX will retain its structure within Novell, its
acquisition, like that of open-source company Ximian in August 2003, is aimed
at promoting Linux adoption and integration broadly across Novell's product
lines. SUSE LINUX engineers will work closely with Novell's product teams to
ensure they maximize their respective synergies in joint development efforts.
"We're making a commitment to open source, not to a product we're selling,"
said Messman. "With SUSE LINUX and Ximian, we gain some of the best open
source developers in the market, and we want to leverage those capabilities
in our development efforts across the entire product line."

"2004 will be the year of Linux," said Richard Seibt, the former CEO of SUSE
LINUX who will join Novell and continue to manage SUSE LINUX as President.
"Novell's global sales and support channels provide tremendous new avenues to
get Linux -- and especially SUSE LINUX -- to market. Leveraging open source
in your enterprise just got a whole lot easier."

In conjunction with the completion of the SUSE LINUX deal, Novell is also
announcing an indemnification program designed to provide a measure of
protection against certain intellectual property challenges to Linux. Details
on that program are outlined in a separate press release issued today.

Novell Now Delivers Full Range of Linux Solutions
SUSE LINUX offers Linux server and desktop systems designed to address both
large and small customer needs. SUSE* LINUX Enterprise Server 8 for midsize
to large companies provides core networking services with the
high-availability and scalability features needed for data center
deployments. SUSE LINUX Standard Server 8 offers a user-friendly interface
and easy installation and configuration tools to deliver file, print,
infrastructure, e-mail, Internet gateway, and application server capabilities
to smaller business and departments. The SUSE LINUX Desktop provides a
full-featured Linux productivity environment for end-users, with email, an
office suite, web browsing, and remote administration features. SUSE LINUX
Openexchange Server provides email, calendar, task setting and other
collaboration tools to make enterprises more productive. 

SUSE LINUX 9.0 -- the first home user operating system platform to leverage
AMD's Athlon 64 processor -- enables easier Windows migration by supporting
NTFS file systems and also gives experienced users a sneak peek at the
enhanced capabilities of the 2.6 Linux kernel - with many of those
capabilities back-ported into the 2.4 default kernel as well. 

"Novell's acquisition of SUSE LINUX is great for Linux customers because of
the depth of enterprise expertise and technical prowess that both companies
bring to the table," said Martin Fink, vice president of Linux, HP. "Having
strong partnerships with both Novell and SUSE LINUX, HP has been working
closely with both companies and is excited to offer the resulting joint
solutions which enable customers to deploy Linux applications with
confidence."

With its acquisition of SUSE LINUX, Novell enhances the series of Linux-based
solutions it already offers. Novell® Nterprise(TM) Linux Services, which
shipped in December 2003, provides integrated file, print, messaging,
directory and management services on SUSE LINUX and Red Hat*. The Novell
ZENworks® and Ximian® Red Carpet Enterprise(TM) products manage Linux servers
and desktops in mixed network environments. Ximian Desktop 2 provides a
full-featured productivity and collaboration environment for the Linux
desktop, while Ximian Connector for Evolution lets users of the Linux-based
Ximian Evolution® collaboration suite interact seamlessly with counterparts
using Windows Exchange.

IBM Investment
The closing of the SUSE LINUX acquisition fulfills conditions for the $50
million investment by IBM in Novell announced November 4. In addition, the
closing allows for completion of negotiations between Novell and IBM to
extend the existing commercial agreements between IBM and SUSE LINUX for the
continued support of SUSE LINUX on IBM's eServer* products and middleware
products and to provide for product and marketing support arrangements
related to SUSE LINUX. Details on these efforts will be forthcoming.

Forward-looking Statements
This press release includes statements that are not historical in nature and
that may be characterized as "forward-looking statements," including those
related to future financial and operating results, benefits and synergies of
the company's brands and strategies, future opportunities and the growth of
the market for open source solutions. 
You should be aware that Novell's actual results could differ materially from
those contained in the forward-looking statements, which are based on current
expectations of Novell management and are subject to a number of risks and
uncertainties, including, but not limited to, Novell's ability to integrate
acquired operations and employees, Novell's success in executing its Linux
strategies, Novell's ability to deliver on its one Net vision of the
Internet, Novell's ability to take a competitive position in the Linux
industry, the outcome of potential Linux-related litigation, business
conditions and the general economy, market opportunities, potential new
business strategies, competitive factors, sales and marketing execution,
shifts in technologies or market demand, and the other factors described in
Novell's Annual Report on Form 10-K for the 2002 fiscal year.
Novell disclaims any intention or obligation to update any forward-looking
statements as a result of developments occurring after the date of this press
release.

About Novell
Novell, Inc. is a leading provider of information solutions that deliver
secure identity management (Novell Nsure(TM)), Web application development
(Novell exteNd(TM)) and cross-platform networking services (Novell
Nterprise), all supported by strategic consulting and professional services
(Novell Ngage(SM)). Active in the open source community with its Ximian and
SUSE LINUX brands, Novell is firmly committed to open source and offers
comprehensive Linux products and services for the enterprise, from the
desktop to the server. Novell's vision of one Net - a world without
information boundaries - helps customers realize the value of their
information securely and economically. For more information, call Novell's
Customer Response Center at (888) 321-4CRC (4272) or visit
http://www.novell.com. Press should visit http://www.novell.com/pressroom.

###

Novell, Ximian, Ximian Evolution and ZENworks are registered trademarks;
exteNd, Nsure, Nterprise and Red Carpet Enterprise are trademarks; and Ngage
is a service mark of Novell, Inc. in the United States and other countries.
SUSE is a registered trademark of SuSE Linux AG. All third-party trademarks
are the property of their respective owners.


Press Contact:
Bruce Lowry
Novell, Inc.
Phone: (415) 591-6523
E-mail: blowry@novell.com