Novell Acquires e-Security, Redefines Security and Compliance Management

WALTHAM, Mass. – April 19, 2006 – Novell today announced its acquisition of e-Security, Inc., a move that will make Novell a pioneer in delivering a single view of security and compliance activities across the entire enterprise. The deal combines the benefits of Novell’s identity and systems management expertise with
e-Security’s real-time event monitoring, response and reporting capabilities. With a comprehensive view of user, network and application events, customers will now be able to streamline a previously labor-intensive and error-prone process, cut costs through automation, and build a more rigorous, predictable security and compliance monitoring program.

“In the compliance area, customers want converged solutions that encompass system, identity, access and security event management,” said Chris Christiansen, IDC vice president of security products and services. “With the acquisition of e-Security, Novell is the only vendor with the potential to proactively address business needs for a real-time, comprehensive compliance solution that integrates people, systems and processes.”

Automated Compliance Monitoring and Reporting

From government regulations such as Sarbanes-Oxley, Basel II and HIPAA to corporate governance initiatives, regulatory environments have become increasingly complex. Too often, organizations are left to rely on varying information sources and tools to monitor compliance, an approach which is inefficient and error-prone. To streamline workflow and ensure data accuracy, Novell is focused on delivering an infrastructure for more comprehensive security and event monitoring. With the addition of e-Security’s award-winning product, Sentinel 5, Novell can deliver a solution that provides a real-time, holistic view of security and compliance activities, while helping customers monitor, report, and respond automatically to network events across the enterprise.

A Holistic Approach to Security and Compliance

“Compliance is changing the way companies think about security and identity management: the focus now is on automating and reporting results, as well as responding to events and non-compliant activities as they happen,” said Jack Messman, chairman and CEO of Novell. “Novell’s acquisition of e-Security demonstrates our commitment to this growing market, leveraging a core element of our business to deliver robust security and compliance solutions that meet our customers’ needs in an increasingly regulated business environment.”

Reed Harrison, founder and chief technology officer of e-Security, said, “Combining Novell’s expertise in identity management with our real-time security event monitoring and reporting capabilities will create an unmatched solution. As a member of the Novell family, we can now help redefine how customers think about security and compliance.”

Sentinel 5 can be purchased from Novell beginning in May. The next version of the Novell® and e-Security solution is expected to be available this summer.

Novell paid US$72 million to acquire e-Security. Novell estimates a positive revenue impact from the acquisition of roughly US$20 million in the coming 12 months.

Conference Call Notification

Novell will host a conference call to discuss the acquisition at noon EDT on April 19. Dial in access for the call is: US/Canada – (888) 677-2190; International – (773) 756-0374; Password – “Novell”. A live webcast of the call will also be available at http://www.novell.com/esecuritycall.

Forward-Looking Statement

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 Identity and Access Management and Open Platform 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* and identity and resource management strategies, Novell’s ability to take a competitive position in the Linux and identity and resource management industries, 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 filed with the Securities and Exchange Commission on Jan. 10, 2006. 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.