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SCO Goes Private With $100 Million Backing
AmIAnAi writes "Just when you thought it was all over, the SCO story takes a new twist. SCO has received $100 million financing from Stephen Norris Capital Partners to get them out of Chapter 11 and go private 'The move gives Stephen Norris, whose namesake founder was a co-founder of private equity giant The Carlyle Group, a controlling interest in SCO, which now has a platform to continue its court battle with Novell Inc. over royalties from the Unix server operating system, SCO's main business ... According to a statement from the company, SNCP already has a business plan for SCO that includes pursuing its legal claims.'"
... the Stephen Norris group. When do the judges get sick of barratry?
Dog is my co-pilot.
Man oh man...
This news completely ruins my day.
I just know that tonight while my lady is receiving the annual ~Valentine Fisting~ my mind will be on SCO and their ridiculous lawsuits, not on the work at hand. She'll know something is bugging me, get pissed off and make me stop. I'll have KY to my elbows for nothing.
Thanks SCO.
Trolling is a art,
What kind of genius investment group thinks sueing IBM is a winning proposition?
Man oh man, talk about a massive waste of money. Does SCO even produce anything anymore? I thought SCO was basically Darl in a hotel room somewhere with two of hookers doubling as his "legal team"...
... that we can boycott? (Or is Microsoft, in fact, at the root of it?)
Step 1. Pile money onto a sinking ship
Step 2. ???
Step 3. Profit!
I have a very poor financial outlook for the near future, why can't somebody give me $100 million? Hell, I'll use that to make legal claims about somebody else's IP! I can probably even develop an operating system nobody in their right mind would use.
Oh, a lesson in history from Mr. I'm my own grandpa.
Bruce
Bruce Perens.
When I mis-read it, I thought: "Chuck Norris can make SCO viable!".
I'm glad it's just *Stephen* Norris.
Lets take inventory.
* Taking a beating in court.
* Its only valid business is a dying operating system.
* Your customers and pretty the entire tech industry hates you.
* The company is in chapter 11.
* The company has a negative cash flow.
* The judge in your case appears to hate you because of your court practices.
* I hate you.
Yeah, lets throw $100 million at them...
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Thanks to spacelifeform on GL:
http://www.iht.com/articles/2007/02/12/bloomberg/bxfour.php
NEW YORK: Four Seasons Hotels, the manager of 74 luxury hotels, said Monday that it had agreed to be taken private by Bill Gates, Prince Alwaleed bin Talal and the chief executive for $3.8 billion, including debt.
Coincedence?
----
Who is Stephen Norris,
http://www.snpartners.com/norris.html
Looks like there could very easily be some behind the curtain financing of this through foreign nationals.
---
Mr. Norris acted as a principal financial advisor to Prince Al-Waleed bin Talal Al Saud of Kingdom Holding Company, in structuring and negotiating the re-capitalization of Citibank, which returned over $15 billion in profits on about $590 million of equity invested. He also advised or played a key role in other Kingdom Holding Company investments. He was appointed by former president George H.W. Bush and confirmed by the U.S. Senate to serve as one of five governing members of the $100 billion Federal Retirement System Thrift Investment Board.
Since 1997, Mr. Norris, and certain members of his team, have worked on a number of investments including real estate investments in Europe and the United States. They were involved in amongst others the privatization of Thompson CSF, the recapitalization of Suez, the acquisition of portions of Credit Foncier's real estate portfolio in Paris by the German firm of IVG, the formation of Nomura's (London) bid for a Dutch mortgage bank, the offer by a major Saudia Arabian investment firm for Lamborgini in Italy, and the formation of a bid by Leucadia International's for the Labouchere Bank in Holland. He also negotiated and structured investments in Synxis Corporation, which was backed by George Soros and Mr. Norris, and MARC Global Holdings.
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Oh good, looks like Novell and IBM can acually get some money out of SCO now.
Victory or awesome!
My understanding was that the company imploded because it was ruled that they did not own the Unix copyright, upon which the majority of its legal claims were based. What legal claims could they possibly have left?
Also, buying a company for the sake of being able to earn legal awards should be illegal, strictly as a matter of financial sanitation. A good solution to this would be a statute that makes a buyer liable for claims up to the amount he paid for the company, but make both him and the company unable to claim any rewards in suits pending on the company's behalf.
The next Slashdot story will be ready soon, but subscribers can beat the rush and slashdot the links early!
Novell is now assured of getting every penny they've got coming to them.
Disinfect the GNU General Public Virus!
i for one welcome our new SCO rescuing overlo...no, wait, ffs!
I'm a rabbit startled by the headlights of life
Looks like one of their senior people is in with George Soros. So they have potentially some very serious money behind them now.
Dog is my co-pilot.
-sarcasm?
"The Big Guys Work For The Carlyle Group
What exactly does it do?
To find out, we peeked down the rabbit hole.
FORTUNE Monday, March 18, 2002
The Carlyle Group, a Washington, D.C., buyout firm, is one of the nation's largest defense contractors. It has billions of dollars at its disposal and employs a few important people. Maybe you've heard of them: former Secretary of State Jim Baker, former Secretary of Defense Frank Carlucci, and former White House budget director Dick Darman. Wait, we're just getting warmed up. William Kennard, who recently headed the FCC, and Arthur Levitt, who just left the SEC, also work for Carlyle. As do former British Prime Minister John Major and former Philippines President Fidel Ramos. Let's see, are we forgetting anyone? Oh, right, former President George Herbert Walker Bush is on the payroll too..."
http://www.carlylegroup.net/thebigguys.htm
So now the Bushes are going to send Jim Baker to court to steal Linux.
"Hahahaha. Maybe this is the key? That's code, I think, for 'this will enable the company to continue to attack Linux'."
http://www.groklaw.net/article.php?story=20080214125705140
Can't believe they forgot the Groklaw link!
Its like some really bad slasher flick where the bad guy just..... won't.... fucking.... die...., and the audience gets tired of all the inventive ways in which they are bought back to life....
After a nuclear holocost the only thing left will be cockroaches, twinkies and SCO. If you chop off the heads of SCO lawyers they continue to live for a week. Just when you think they're dead those tiny little litigating arms start moving again.
He'll just roundhouse kick them until they sue themselves.
Step into a huge movement. Don't Tread In Me.
My wife went to law school and is now a practicing Attorney at a pure IP (Intellectual Property) NYC firm for a few years now.
/. is wrong, and the market is right.
There is an ongoing mad scramble to snag IP assets of all kinds.
(Key word: ALL KINDS)
I have been a long time IT person, and I happen to also be able to this peek into this neo-IP world, so I have a sense of deja vu -- similar to the dot-com frenzied land-grab --except that there are NO joe six packs doing the investing, just ultra-rich+ultra-smart professionals.
If anything is copyrighted (not patented) it has value for an infinite time frame. Grab onto it.
This may be yettunnadder instance of where
Stupidity cannot adequately explain this move, which leaves...
Simple Unexpected Concrete Credible Emotional Stories
Hire your brother (Kevin McBride) as a lawer and pay him a pile of legal fees (thereby getting the money out of the sinking ship and back onto dry land, but out of reach of the investors).
Engineering is the art of compromise.
SCO is proposing to go private.
Right now they can't buy paperclips without Judge Gross's permission (ok, I'm exaggerating, but only a little).
The US Trustee, Novell and IBM are all going to over the plan with a fine-tooth comb and the judge isn't going to approve it just on SCO's say-so. This could be like the York deal that SCO tried to push though last year, all smoke and mirrors.
So don't go getting your shorts in a bunch just yet.
Watching the shenanigans of SCO has turned into the geek equivalent of Dallas for geeks.
This week on SCO
Novel "oh my god!, Im sure I killed him"
SCO "Im baaaaack and I have 100 million dollars"
Red Hat "what crack monkey gave him money ?"
> SCO has received $100 million financing
SCO has received nothing except offer (which is probably contingent on many conditions). They cannot accept it without permission of the bankruptcy court. To read some actual facts go to Groklaw.
Warning: this article may contain humor, sarcasm, parody, and perhaps even irony. Read at your own risk.
And you can't do a deal like this without authorization from the Bankruptcy Court. This will probably all be part of a Chapter 11 plan of reorganization the details of which have yet to be filed by SCO. The devil is in the details with these things and you can be sure SCO will be out to screw all general unsecured creditors; that's pretty much par for the course in all Chapter 11 plans. Also, expect a lot of Bankruptcy Court litigation over the status of Novell's claim, i.e. SCO will attempt to lump them in with the other general unsecured creditors and Novell will assert its trust theory. At any rate the post petition funding here will not be available to SCO's pre-petition creditors, including Novell. All those claims are dealt with in the CH 11 Plan and are discharged by the approval of the Plan.
None of SCO's claims in any of their lawsuits involve patents.
Warning: this article may contain humor, sarcasm, parody, and perhaps even irony. Read at your own risk.
This is not capitalism at work, it's predatory behavior and something anti-trust lawyers should sink their teeth into. There is no reasonable expectation of return on SCO's "business" because SCO is full of shit and every decision has been against them. This is just another $100 million that M$ does not mind pissing away. The "investment" harms the reputation of all involved.
i think we should be welcoming this, this way novell ibm and the rest of the linux community will get every penny of the money they're owned, which goes back into linux and into opensource, if the bin laden / bush coalition want to pour money effectively into linux to stop MS's dirty laundry from being aired it seems a good thing to me than the far more shady ways they would doubtless otherwise employ.
maybe they want a tax credit for donating to a non-profit organization
Nobody running a successful LBO firm is stupid enough to make this ridiculous lawsuit the central part of an execution plan.
The Statements in the release are quite lawyerly indeed. The funding is in place, IN PART, to "see SCO's legal claims through to their full conclusion". PJ interprets this to mean "continue to attack Linux", and indeed the deal suggests that is something these investors would like to see returns from: the vast majority of this $100M is not hard cash to be handed over in one lump sum loan, it is a "line of credit" to fund continued operations and part of financing this line of credit would be, IIRC, 17% of any monetary judgments in SCO's favour.
However, I cannot believe that the smart people behind SNCP sincerely think they have a good chance of actually WINNING the lawsuit. I think it's more of a "lottery ticket"--lawyers make sure their butts are covered, and that they'll be able to screw ove...errr I mean "receive compensation" under all circumstances. "Continue to pursue" litigation "to their full conclusion" could very well be code words for "finally put it to rest". They apparently have a plan that includes the legal stuff but haven't released details (and taking SCO private would mean they don't ever have to do so). That plan very likely incorporates (or entirely consists of) a contingency plan. It looks pretty bleak to reverse the decision on copyright ownership, but they can appeal a judgment on royalties owed to Novell and get out of paying tens of millions. The same goes for any counter-suits from the likes of IBM or Red Hat. SNCP may think they have the ability to get SCO out of hot water without paying out as much (or any) money.
In short, their legal strategy might (wisely) be a defensive strategy to cut their losses and move on. To paraphrase that cute song "if I had a (hundred) million dollars", well, I'd "buy me a SCO" too actually, and that would almost be my legal plan, though I'd be more apt to not put too much effort in "cut the losses" and settle out of court. If I was some LBO billionaire dude I'd buy SCO, and when judgment came I'd say "here's your money Novell", and subsequently settle all other disputes quickly. Then I'd promptly GPL UNIXWare and OpenServer and use what's left of the technical people to refocus SCO as a "solutions provider" to target the thousands of SCO users around the world with UNIXWare/OpenServer-to-Linux migration plans. Anything of redeeming value in the newly-GPLed legacy OS products would then be incorporated into a "LinuxWare" distribution tailored to be as close as possible to a drop-in replacement for existing SCO customers.
The background of SNCP and their "middle eastern partners" really make me uncomfortable though. Those stated partners include the Saudi prince who is Bill Gates' investment partner in the Four Seasons hotel chain. These are legally-savvy business tycoons. I cannot see them taking the "Mark Shuttleworth act of benevolency" approach that I'd take. They are no doubt acting with convincing insider knowledge. I think that there might be a few motivators for this investment:
* They might have a convincing legal argument to overturn some of the judgements against them--for example they might be able to retain copyright to at least portions of UNIX, and that would at least allow the IBM lawsuit to move forward and keep the FUD coming for Microsoft.
* They are trying to stem customer migrations to Linux. I have no doubt that even if Microsoft isn't tied to this deal that BillG *is* in some capacity, and he obviously has the betterment of Microsoft in his self interest. The business plan outside the legal battle may be in fact to steer SCO customers towards Microsoft solutions, and perhaps to eventually have MSFT absorb SCO entirely. If you combine that with the first point, that would mean MSFT could end up with some UNIX copyright ownership--a great piece of IP to leverage if you wished to embrace, extend and extinguish *real* UNIX operating systems of all kinds (like
Cockroaches don't fare much better than humans to radiation.
From wikipedia:
It is popularly suggested that cockroaches will "inherit the earth" if humanity destroys itself in a nuclear war. Cockroaches do indeed have a much higher radiation resistance than vertebrates, with the lethal dose perhaps 6 to 15 times that for humans. However, they are not exceptionally radiation-resistant compared to other insects, such as the fruit fly. The MythBusters of Discovery Channel had tested this popular belief in an episode aired on January 30, 2008, and had confirmed that fruit flies do indeed have a higher resistance to radiation than cockroaches.
The cockroach's ability to withstand radiation better than human beings can be explained in terms of the cell cycle. Cells are more vulnerable to effects of radiation when they are dividing. A cockroach's cells divide only once when in its molting cycle, which at most happens weekly in a juvenile roach. The cells of the cockroach take roughly 48 hours to complete a molting cycle, which would give time enough for radiation to affect it but not all cockroaches would be molting at the same time. This would mean some would be unaffected by the initial radiation and thus survive, at least until the fallout arrived.
This doesn't do that much for SCO. It gives Novell, IBM and Red Hat cash to go after. Remember, there are substantial legal claims against SCO, and those claims are on much stronger grounds than SCO's claims against anybody.
SCO is headed for their day in court:
U.S. District Court - District of Utah - Court Calendar
Honorable Dale A. Kimball
Tuesday, 04/29/2008
08:30 am: SCO Grp v. Novell Inc (2:04-cv-00139-DAK-BCW) Bench Trial
The only question in that trial is how much money SCO owes Novell. SCO will appeal, but they are unlikely to win.