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Corel Corporation shareholders are revolting. They say the struggling software company has sold them down the river by agreeing to flog the business for a bargain basement price.

Rebel shareholders have set up a Web site, corelrescue.com, to help railroad this "unfair takeover offer".

Earlier this month, directors of Corel - known for a number of software packages including WordPerfect Office, the CorelDraw Suite and Corel Painter - announced they had accepted a takeover bid by San Francisco-based venture capital firm, Vector Capital.

At the time James Baillie, Corel chairman, said the deal was an "opportunity for the shareholders of Corel to realise the value of their shareholdings" and the takeover was in the "best interests of the company and its shareholders".

The rebel shareholders don't see it this way. They're fuming because the deal values their shares at an "unacceptably low price of just $1.05 per share" (US$97.6m in cash).

In a statement rebels said: "This offer by the Vector Capital…is far too low to be seriously considered. Under the presented scheme, Corel's great line-up of award-winning products…would be virtually given away for free."

They claim the company has "very large cash reserves" and following a recent round of redundancies and other restructuring now has spending under control.

"We shareholders would rather not sell at the bottom of the currently depressed market, but instead want to be able to reap the benefits as we patiently wait for Corel's three-year turnaround plan to fully unfold over the next year or two," they said.

"We appeal to Corel's management and the board of directors, who are hired to look after shareholders' best interests, to scrap this extremely unfair takeover offer and to continue working together with the shareholders towards renewed profitability and the release of Corel's upcoming new enterprise products."

The proposed takeover still needs to be given the green light by the courts and shareholders. ®

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