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06.17.09

SCO is Not Rescued Yet, But Group with Microsoft Connections Waves Money

Posted in Courtroom, Finance, GNU/Linux, Microsoft, SCO at 9:20 am by Dr. Roy Schestowitz

Sad boy with the coins
Sneaky gits

Summary: The SCO saga is not over yet, as further delays are caused by mysterious funding

A few days ago we warned that groups with connections to Microsoft were getting close to SCO just before liquidation seemed unstoppable and imminent. Some time yesterday we began finding articles which confirm not a transaction being made but a deal being signed in the 90th minute. SJVN writes:

We don’t know who’s behind this latest SCO buyout craziness, but it seems a safe bet that at the bottom of it all we’ll find friends of Microsoft. There’s simply no sane business reason to keep SCO’s anti-Linux litigation in play except to spread a little anti-Linux FUD, and Microsoft is the only company that has any real interest in seeing that happen.

Watch again who is involved:

Immediately before the crucial liquidation hearing in the bankruptcy court, SCO CEO Darl McBride signed an agreement with a company by the name of Gulf Capital Partners, backed by well-known investor Stephen Norris. Caught out by the surprise development, all parties have agreed to postpone the liquidation hearing until the 16th or the 27th of July.

We wrote about these investors in:

Doesn’t this sound a little dodgy?

“We signed that deal just minutes before the court hearing, and walked in and handed it to them, ” said Darl McBride, CEO of Lindon-based SCO.

Earlier on, Groklaw opined that SCO was just using delaying tactics, but later coverage cannot confirm this.

So, the bottom line of the day is that the proposed sale to Gulf-Cap-whatever-their-name-really-turns-out-to-be (see previous article) will have a hearing on July 16, as Webster earlier reported. So we will no doubt get to see the proposed agreement filed, and then objections, the usual song and dance. So, bottom line? Delay, delay, delay. It’s too bad SCO can’t package it up and sell delay. They’d make a fortune. It is what they are best at, I’d say.

Linux Journal has a very extensive summary, which concludes with:

As it stands, everything remains up in the air — the proposed sale is by no means final, and if it is like any of the others, is likely nothing more than a delaying tactic. If the judge has any sense about him, when and if this deal falls through like all the rest, he’ll wake up and finally start sanctioning SCO for treating the Bankruptcy Code like kindling. If it falls through by next month’s hearing, SCO will need a miracle even Satan couldn’t help them get to avoid conversion into a Chapter 7 — once the Chapter 7 trustee gets his hands on them, they’ll find themselves sold off faster than $5 Ferraris. By the time it finally happens, that champagne we all put away in 2002 will be just about right.

According to this, SCO is not guaranteed an extended lifetime. Better answers will have arrived by the end of this month however.

“[Microsoft's] Mr. Emerson and I discussed a variety of investment structures wherein Microsoft would ‘backstop,’ or guarantee in some way, BayStar’s investment…. Microsoft assured me that it would in some way guarantee BayStar’s investment in SCO.”

Larry Goldfarb, Baystar, key investor in SCO

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A Single Comment

  1. The Mad Hatter said,

    June 17, 2009 at 11:47 pm

    Gravatar

    It’s time to buy your SCO shares – you can frame them, and hang them on your wall for your grandchildren to see. Of course they’ll think you are a lying bastard when you tell them what happened…

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