updated 4/17/2006 6:11:14 PM ET 2006-04-17T22:11:14

Business software provider Oracle Corp. is considering plans to offer its own version of the Linux operating system and has studied an acquisition of Novell Inc., the open-source operating system's No. 2 distributor, according to a newspaper report Monday.

Novell shares rose 2.3 percent in Monday trading, while rival Red Hat Inc. fell 6.7 percent.

Oracle sells databases and other business applications, and by offering a version of the Linux operating system, it would be able to provide customers with a more complete suite of software. Rivals such as Microsoft Corp. and IBM Corp. commonly tout the benefits of these packages, called "stacks."

Oracle's chief executive, Larry Ellison, told the Financial Times that the company might launch its own version of Linux and has considered buying Linux distributor Novell. That could help counter leading Linux vendor Red Hat, which just announced a $350 million acquisition of JBoss Inc., a maker of open-source "middleware," which connects varying applications.

"I don't think Oracle and IBM want another Microsoft in Red Hat," Ellison told the Financial Times.

A spokesman for Redwood Shores, Calif.-based Oracle did not return a call seeking comment. Representatives of Waltham, Mass.-based Novell and Raleigh, N.C.-based Red Hat declined to comment, as did an IBM spokesman.

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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