NOVL Novell, Inc. (MM)

Software company Novell Inc. (NOVL) said Saturday its board has rejected an unsolicited bid from hedge fund Elliott Associates LP to acquire the company for $5.75 per share in cash, calling it "inadequate."

Novell in a press release said the bid "undervalues the Company's franchise and growth prospects."

Elliott Associates, which holds an 8.5% stake in Novell, earlier this month offered to buy the rest of the company for about $1.8 billion.

Novell also said Saturday its board has authorized a "thorough review of various alternatives" to enhance stockholder value. Among these alternatives, it said, are strategic partnerships and alliances, joint ventures, a stock repurchase or cash dividend, a recapitalization and a sale of the company.