Michael Cowpland has resigned as president, CEO and chairman of the board of Corel, to spend his time on "new startup opportunities", the company has revealed.
Derek Burney, Corel’s executive vice president, engineering and chief technology officer becomes interim CEO and president. Burney has been with Corel since 1993. Cowpland will continue to serve as a director on the board and as a technology advisor, but will not be involved in the company's operations.
Corel has suffered financial losses, staff lay-offs and a failed merger-deal with US development-tools vendor, Inprise/Borland. Speculation that Corel was facing bankruptcy scuppered the merger – and this was followed by the resignation of top executives.
Late last year, Cowpland was charged with three counts of violating Ontario securities law. He stood accused of using insider information on lower-than-expected quarterly financial report for the third quarter of 1997 to sell 2.43 million shares of company stock for $14 million. Cowpland disputes the charges.
A spokesman with the Ontario Securities Commission said Cowpland’s resignation was not related to the commission's investigation.
"It had been expected. Corel had some relatively disappointing financial results for what was a long period of time," said Rob Enderle, senior industry analyst with Giga Information Group.
Even with Cowpland's departure, financial recovery could be a way off for the Canadian applications vendor and Linux distributor, Enderle suggested: "Mike is only part of the problem at Corel. Getting the company back on track will depend on who replaces Cowpland, but finding a new CEO could prove a hard-sell for the company.
"Who wants a job that could likely end their career. They'd risk being on a sinking ship. It's a precursor to what may happen at Oracle, in the sense of the problems you have with a fairly visible and perhaps less restrained CEO," Enderle said, referring to Oracle chief Larry Ellison, who is known as much for his flamboyance as for his acumen as a CEO.
Chris Le Tocq, at Gartner Group, agreed: "Companies take on the character of the CEO and Corel was very much that kind of a company," he said. "It will be a very different company under someone else."
Exactly what kind of company is debatable, as Corel's push to become a Linux powerhouse lost impetus as a result of both the failure of the merger, and because the competition has already made inroads into the Linux market.
"Under Michael, Corel basically bet the farm on moving applications to Linux. Today, Sun has moved StarOffice to Linux and that will limit the opportunity for Corel," Le Tocq said. StarOffice is Sun's rival applications suite to Corel's WordPerfect software family.
Speculation at LinuxWorld 2000 on Cowpland's permanent replacement threw-up the name of Dale Fuller, Inprise/Borland's interim president and CEO.
In an interview last month, Fuller said that strategically, the merger between Corel and Inprise "was a sound deal, and still is today".
Trading in Corel shares was halted in Toronto half an hour before Cowpland's announcement.