Corel Press Release

Corel Completes InterVideo Acquisition, Advancing Its Digital Media Software Strategy - Corel Well-Positioned To Emerge as a World Leader In Digital Media Software With Industry’s Broadest Portfolio Of Digital Imaging and DVD Video Products

OTTAWA - December 12, 2006 - Corel Corporation (NASDAQ:CREL; TSX:CRE) today announced the completion of its acquisition of InterVideo, Inc., a leading provider of digital media authoring and playback software with a focus on high-definition video and DVD technologies. Corel purchased InterVideo for $13.00 per share of InterVideo common stock resulting in an aggregate acquisition price of $198.6 million in an all-cash transaction. The acquisition substantially expands Corel’s presence in the digital media software market by creating the industry’s broadest portfolio of digital imaging and DVD video products. With the addition of InterVideo, Corel will deliver easier-to-use, multi-purpose high-definition video, imaging, and DVD creation products to consumers and enterprises worldwide while extending its presence in fast-growing Asian markets, such as China, Taiwan and Japan.

InterVideo’s comprehensive suite of advanced digital video and multimedia software products allow users to record, edit, author, distribute and play digital multimedia content on PCs and other devices. In 2005, InterVideo acquired a majority interest in Ulead, a leading developer of video imaging and DVD authoring software for desktop, server, mobile and Internet platforms, and the acquisition of the remaining interest in Ulead is expected to be completed before the end of 2006.

The acquisition combines Corel’s key strengths – business model innovation, understanding of end user requirements and established distribution in the Americas and Europe – with InterVideo’s core assets, which include video technology innovation, established partnerships with the world’s leading PC OEM partners and strong market presence in the Asia Pacific region.

“This strategic combination further strengthens Corel’s leadership position in digital media software and will enable us to deliver even greater value to our customers, partners and shareholders worldwide,” said Corel Chief Executive Officer David Dobson. “We welcome InterVideo’s employees, customers and partners to Corel and we look forward to working with them.”

The combination of Corel, InterVideo and Ulead product lines form the industry’s broadest portfolio of digital media software ranging from photo sharing and image editing products to advanced digital imaging, video editing, and high-definition DVD creation and playback software. Customers and partners now have access to a full breadth of popular, award-winning digital media brands including WinDVD®, WinDVD Creator™, Ulead® PhotoImpact®, Ulead® VideoStudio™, Ulead DVD MovieFactory®, Corel® Paint Shop Pro Photo® and Corel® Snapfire™ – all from a single trusted source. In addition, Corel will deliver HD DVD and Blu-ray Disc solutions to the market, just as the worldwide demand for high-definition video gains significant momentum.

The InterVideo and Ulead product lines complement Corel’s existing digital imaging and video products in several areas, including performance, ease of use and price. In addition, the companies share a common vision around delivering high quality, full-featured software to consumers through leading OEMs, retailers, and Internet distribution channels.

“The addition of InterVideo and Ulead products to our existing digital imaging portfolio puts Corel in a unique position to meet the evolving needs of consumers demanding higher quality and more accessible digital media content – specifically high-definition digital images and videos accompanied by more creative and enjoyable ways to view and share them,” said Blaine Mathieu, general manager of Corel’s Digital Imaging Business. “With the ongoing convergence of different media and devices, consumers need easier-to-use tools that can handle all media types – video, photo and audio – on an equal basis. Corel will fulfill this growing demand by delivering new, easier-to-use, multi-purpose video and imaging software products to consumers and enterprises worldwide.”

Corel will leverage its complementary geographic strengths with InterVideo and Ulead to create an even more efficient sales, marketing and product development engine. With significant development offices in California, China, Minnesota, Ottawa and Taiwan, Corel will be better positioned to meet the specific requirements of customers and partners in various locations around the world.

“The excitement surrounding properties like YouTube clearly showcases why the multimedia software and services segment is so incredibly hot right now,” said Rob Enderle, Principal Analyst for the Enderle Group, a leading San Jose, CA-based research firm covering emerging hardware and software markets. “The enormous mass market potential for products that provide solutions for this rapidly growing segment simply has not yet been realized. Corel is placing itself in the middle of this huge opportunity so that they can capitalize on this incredible opportunity and help drive market growth.”

InterVideo and Ulead customers and partners can continue to access support through their existing contacts and channels. Further information can be found at www.intervideo.com, www.ulead.com or www.corel.com.

The acquisition was financed through a combination of Corel’s cash reserves, InterVideo’s cash reserves and debt financing which included Corel entering into an amendment to its existing credit agreement to increase its available term borrowings by $70 million.

Corel will provide guidance on the combined company when it reports its financial results for the year ended November 30, 2006, in January.