Beta
×

Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

SCO gets $50 Million Investment

CowboyNeal posted more than 10 years ago | from the fuel-to-the-flame dept.

The Almighty Buck 491

sjbe writes "It was announced today that SCO received $50 million in private equity funding. The lead investor is BayStar Capital which has invested in Roxio among other companies. This gives SCO a pretty big war chest to fight IBM. Before this investment SCO only had a few million in cash remaining. If you thought SCO was annoying before, this won't help."

cancel ×

491 comments

Sorry! There are no comments related to the filter you selected.

$50 million? (1)

AntiOrganic (650691) | more than 10 years ago | (#7236606)

In the corporate world, isn't this generally regarded as "not a whole lot of money?"

Re:$50 million? (1)

ScrewMaster (602015) | more than 10 years ago | (#7236643)

That would be true for normal companies that actually produce something of value. Fifty mil, if applied primarily to SCO's legal staff, would keep them around annoying the industry long after the rest of SCO has folded for good.

Re:$50 million? (1)

Compuser (14899) | more than 10 years ago | (#7236647)

This is 50 times their previous cash on hand.
Or put differently, they can now pay a lot of
lawyers.

Re:$50 million? (0)

Anonymous Coward | more than 10 years ago | (#7236684)

I don't think that I've worked in any corporation (severl fortune 500s, a fortune 50, + small fry) that would regard $50 million as chump change.

Good grief, the startup I'm in would, ahem, have enormous joy to get that kind of money right now.

I have no doubt that an "IP startup" like SCO will find it very useful to "build their business."

Re:$50 million? (1)

Mondain98 (562481) | more than 10 years ago | (#7236754)

IBM went up against the US government on monopoly charges in the 80's and never ran out of money.

IBM can spend $50m in their sleep in one week on legal fees.

Re:$50 million? (1)

EvilFrog (559066) | more than 10 years ago | (#7236812)

That's ignoring the fact that IBM isn't anywhere near as big as it used to be. They have only a fraction of the capital they did in the 80s.

Re:$50 million? (0)

Anonymous Coward | more than 10 years ago | (#7236771)

For VA Software, that's 2.5 times their annual revenues of $20,385,000 (fy2002). That's revenues, not profits. So no, not all companies think of $50m as pocket change.

Yahoo Finance link [yahoo.com]

What the hell! (1)

0racle (667029) | more than 10 years ago | (#7236608)

What the hell were they thinking?

Re:What the hell! (1)

ScrewMaster (602015) | more than 10 years ago | (#7236665)

Don't give them too much credit.

Re:What the hell! (1)

nsingapu (658028) | more than 10 years ago | (#7236680)

That they could play a longshot and come out real big if that longshot happens to win. Its the same ideaology that caused some fortune 500 companies to invest in SEO's licenses. I think the suprising thing is that those who stand most to win if ibm is ruled against (i.e. microsoft) have invested so little monitarily in this battle.
Incedentally, some of these funds could eventually be paid out in the lawsuits against SEO for violating the GPL, if said lawsuits succeed. Wouldnt that be sweet revenge, deep pockets paying to further linux. Perhaps Bill will soon join the bandwagon and contribute his cash to further open source.

Re:What the hell! (1)

Gorobei (127755) | more than 10 years ago | (#7236744)

Watch what they invest in over the next few months. If you see sweetheart deal in a promising startup or two, you probably have your answer.

Re:What the hell! (0)

Anonymous Coward | more than 10 years ago | (#7236752)

The same thing could have been said about the millions in stock equity that various "Linux" companies had - what the hell were they thinking?

I am un... CHIEN andalusia! (-1, Offtopic)

Anonymous Coward | more than 10 years ago | (#7236609)

Wanna grow, I wanna be, be a DEBASER!!!

got me a movie (-1)

Anonymous Coward | more than 10 years ago | (#7236720)

ha ha ha ho

slicing up eyeballs

ha ha ha ho

Nice that Forward Looking Statements are required (1)

Empiric (675968) | more than 10 years ago | (#7236610)

Other factors that may affect such forward looking statements include ... and claims of infringement of third-party intellectual property rights.

This is one of the few cases where "third-party" is just too singular-sounding for the thousands of parties it applies to. But at least they are stating the obvious.

Re:Nice that Forward Looking Statements are requir (1)

gladbach (527602) | more than 10 years ago | (#7236741)

even better, this quote will get a big *no shit sherlock* and a big *SUCKERS!!!*

"These statements involve risks and uncertainties. The Company wishes to advise readers that a number of important factors could cause actual results to differ materially from those anticipated in such forward-looking statements. The Company has a history of unprofitability and has only realized revenue from its SCOsource licensing initiative during the last two quarters and the intellectual property rights that it is asserting in seeking to enter into licensing agreements are subject to pending litigation, making it difficult to predict the extent of future revenues from this source. Other factors that may affect such forward looking statements include the ability of the Company to successfully roll out its new services and solutions to service providers in its existing channels; the acceptance of such offerings by existing service providers and customers; the ability of the Company to grow its core UNIX business and the continued acceptance in the marketplace of the Company's core products; the Company's ability to compete effectively with other solutions providers; new and changing technologies and customer acceptance of those technologies; and claims of infringement of third-party intellectual property rights. These and other factors that could cause actual results to differ materially from those anticipated, are discussed in more detail in the Company's filings with the Securities and Exchange Commission."

yay (-1, Flamebait)

Anonymous Coward | more than 10 years ago | (#7236612)

GO SCO!

hay guys what's going on in th (-1, Offtopic)

Anonymous Coward | more than 10 years ago | (#7236613)

oic

Everyone in the handbasket! (-1, Offtopic)

Anonymous Coward | more than 10 years ago | (#7236614)

Everyone in the handbasket! We're leaving now.

Re:Everyone in the handbasket! (0)

Anonymous Coward | more than 10 years ago | (#7236661)

Don't forget to bring a jacket I here it's pretty cold there now.

boycott all companies sharing funding! (1)

Desmoden (221564) | more than 10 years ago | (#7236625)


How can we finally kill this thing? I'm getting so sick of all this!

Re:boycott all companies sharing funding! (0)

Anonymous Coward | more than 10 years ago | (#7236829)

How can we finally kill this thing? I'm getting so sick of all this!

The 'we' that holds copyrights in the Linux kernel could choose to sue SCO.

BayStar just threw away 50 Million dollars (1)

GrassyKnowl (547325) | more than 10 years ago | (#7236628)

SCO's claims are bogus and BayStar just wasted their money. If you are an analyst working for BayStar, I have a bridge that I want to sell you.

Re:BayStar just threw away 50 Million dollars (1)

smoondog (85133) | more than 10 years ago | (#7236693)

SCO's claims are bogus and BayStar just wasted their money.

People on /. keep saying this. I'm starting to think that word does not mean what you think it does. While SCO has been nothing but inept in their limited disclosures and have taken the (very) low road in pursuing this, it is still very possible that the lawsuit with IBM may have merit. If it does, this could prove to be a very nice investment. Talk of a pump and dump scheme is extremely unlikely, IMO, and very hard to prove without a smoking gun.

-Sean

Re:BayStar just threw away 50 Million dollars (3, Funny)

Alsee (515537) | more than 10 years ago | (#7236770)

it is still very possible that the lawsuit with IBM may have merit

Yes, for arbitrary generous definitions of possible and values of merit less than epsilon. :)

-

Re:BayStar just threw away 50 Million dollars (1)

Chris Burke (6130) | more than 10 years ago | (#7236824)

Talk of a pump and dump scheme is extremely unlikely, IMO, and very hard to prove without a smoking gun.

The second part of your statement is true. The first, I can't agree with. Quite obviously "pump and dump" is occuring, in that Darl's beating of the litigation war drum has caused an otherwise highly infeasible rise in SCO's stock and that executives at SCO including Darl are selling off their now valuable shares for hefty gains. The only thing left to decide is if there is a "scheme", meaning Darl & Co know full well their claim has no merit and -only- intended to artificially raise the stock price. That's hard to prove. Extremely hard to prove. Which is exactly why it is not extremely unlikely.

more money? (2, Funny)

potpie (706881) | more than 10 years ago | (#7236629)

So the strategy is to give away money to a dying comapny so that it can pursue its dream of vain lawsuits and dishonor?

Yes, please (0)

Anonymous Coward | more than 10 years ago | (#7236630)

I'm open to equity funding. Please send $50 million my way.

Thanks.

Slashdot announces 5 billion dollar lawsuit vs IBM (2, Funny)

RobK (24783) | more than 10 years ago | (#7236820)

Slashdot announces that they intend to file suit against IBM for $5 billion dollars.

Commander Taco was reported as saying, "There's no basis for this suit, but that didn't stop SCO. Our case is just as strong."

In unrelated news: BayStar Capital is looking to invest $80 Million in Slashdot

Scum. (4, Interesting)

conner_bw (120497) | more than 10 years ago | (#7236632)

Scum of the world unite!

A lot of companies are on a warpath to kill the GPL. A few days ago with Forbes propaganda against "poor Cisco being violated by GPL hitmen" and now more money fuel to fund crap like SCO.

We live in really sick times.

--

Spam Interceptor [si20.com] NOW!

Re:Scum. (1)

ScrewMaster (602015) | more than 10 years ago | (#7236722)

What they want is some legal precedent that the GPL is somehow (and this I find hard to get a mental handle upon) unenforceable. If the GPL can't be enforced, what would give legitimacy to other types of license agreements? Magic? Wormholes from another dimension? Nothing says that an agreement between two or more parties has to fit some arbitrary business "standard" that happens to suit the likes of Forbe's suits. If you make an agreement, you should abide by it, and take the consequences if you don't.

What these clowns really want is for the GPL to appear to be invalid. If they can achieve that, then it won't matter much if the GPL is legitimate because no-one will release anything under it.

Re:Scum. (1)

jhoffoss (73895) | more than 10 years ago | (#7236755)

If the GPL can't be enforced, what would give legitimacy to other types of license agreements? Magic? Wormholes from another dimension? Nothing says that an agreement between two or more parties has to fit some arbitrary business "standard" that happens to suit the likes of Forbe's suits
Simple. Money.

Re:Scum. (1)

pfdietz (33112) | more than 10 years ago | (#7236790)

No, what some companies really want is for the GPL to appear more restrictive than it is, so that companies are inhibited from using GPLed software.

What part of Duh! are you not groking? (0)

Anonymous Coward | more than 10 years ago | (#7236808)

Consider the FSF's own statements - Software should not be consider property.

Do you really think the owners of property are just going to stand by for such a position? Or help it?

Like any good game... (1)

TLouden (677335) | more than 10 years ago | (#7236633)

just when you think you've got things figured out and under control, bang, a new changlange, each one harder than the last, until ultimate boss(M$).

Free Comics (0)

Anonymous Coward | more than 10 years ago | (#7236636)

YAY! At this rate I won't have to pay the MPAA for real actors and comedy relief! This should buy me at least another six months of Darl!

Hah!! (0)

Anonymous Coward | more than 10 years ago | (#7236638)

Why didn't this get the foot icon?

Worst-case scenario (3, Insightful)

ca1v1n (135902) | more than 10 years ago | (#7236639)

This isn't enough money to pull them out of their revenue doldrums. It's just enough money to make them a huge pain in the ass. If it were $500 million we'd probably have *less* to worry about, because they might be able to actually pursue product-based revenue streams.

Re:Worst-case scenario (1)

rekkanoryo (676146) | more than 10 years ago | (#7236748)

No, the management idiots think that their antiquated SysV code can still make them enough money that they could still survive no matter how badly they're bleeding elsewhere. I think that's been made quite clear over the course of this disaster.

Just my $0.02, though.

SCO go for it (-1, Troll)

Anonymous Coward | more than 10 years ago | (#7236644)

Yeah SCO go for it.

Finally a fine company that kicks all these religious people, zealots and wrong belivers into their butt. All this open source crap is only destroying the fine mens work. Open Source only caused trouble and most of the apps are simply dumb hacks and halfheared developed. Once all this Open Source crap disappears people start to become normal again and pay for good and quality software as it has to be.

Re:SCO go for it (0)

Anonymous Coward | more than 10 years ago | (#7236673)

I know. People should have to pay for more stuff. I mean everybody has plenty of money right?

Re:SCO go for it (0)

Anonymous Coward | more than 10 years ago | (#7236674)

Your post reads like a kid trying to prank call someone using language above his normal level.

In other words, YOU FAIL IT.

Good ... (3, Interesting)

molarmass192 (608071) | more than 10 years ago | (#7236645)

now IBM will have something to collect when it wins on those patent infringement suits they've filed against SCO. $50 million or not, it's game over come April 2005 for these guys.

so pissed off (-1)

Anonymous Coward | more than 10 years ago | (#7236648)

fucking hell

Sweet? (2, Interesting)

MrKinkade (676107) | more than 10 years ago | (#7236650)

hehe Great. That means they'll now still have money left when IBM/SGI/RedHat come seeking damages.

Now I get it... (1, Funny)

ejaw5 (570071) | more than 10 years ago | (#7236653)

So THIS is why they stopped sending out those invoices [slashdot.org] .

SCO, owner of Unix (2, Insightful)

NJVil (154697) | more than 10 years ago | (#7236654)

"LINDON, Utah, Oct. 16 /PRNewswire-FirstCall/ -- The SCO(R) Group (SCO) (Nasdaq: SCOX - News), the owner of the UNIX operating system, today announced it has received a $50 million private investment led by BayStar Capital, an investment fund that is a leader in providing negotiated private equity placements in publicly traded companies."

Was SCO ever legally determined to own Unix? I can't keep track of the things that SCO claims to legally own anymore.

Huzzah! (1)

Dr. Photo (640363) | more than 10 years ago | (#7236655)

On the bright side, they now have enough money to be worth suing! Now all the kernel developers (whose copyrights SCO continues to violate!) can get a piece of the pie. :)

Re:Huzzah! (1)

jhoffoss (73895) | more than 10 years ago | (#7236822)

Have any proof? I'm not pro-SCO, but all I've heard so far to back this claim up is that SCO is charging or attempting to charge [corporate!] Linux users for licenses. While I agree this is bullshit, they have a valid point (should it ever be proven) that their code was submitted to the Linux kernel without permission.

But for those that read the transcript of the Darl interview posted on /. recently, SCO won't inform the Linux community what code is [supposedly] violating SCO's copyright. This is being done because if SCO exposes which lines of code they are, they expose the code itself, which then makes their claims against IBM moot. Right now, no one but SCO and (potentially) IBM (and any NDA-signers) know exactly what code is supposedly copied.

Feedback? (1)

coolmacdude (640605) | more than 10 years ago | (#7236657)

I'm sure Baystar would appreciate some public reaction to this decision.

How about we fire off a few emails to their contact address.
info@baystarcapital.com

Re:Feedback? (1)

cgranade (702534) | more than 10 years ago | (#7236830)

Better yet, just post a link on the main page... oh, wait...

BayStar Cash (1)

Juneau (703789) | more than 10 years ago | (#7236658)

I agree that in the scheme of things that $50M is not a lot of cash. They will burn through a significant amount of that defending themselves from IBM and Red Hat. I'd love to know what they will actually spend improving their products. My guess is not much at all.

Re:BayStar Cash (1)

lurking (51269) | more than 10 years ago | (#7236707)

What product? Seriously?

This is so irresponsible (3, Insightful)

Texas Rose on Lava L (712928) | more than 10 years ago | (#7236662)

Think how many starving children you could feed for $50 million... or how much cancer research you could fund. I mean seriously, they couldn't think of anything better to do with their money than give it to SCO?

Re:This is so irresponsible (1)

freeweed (309734) | more than 10 years ago | (#7236821)

Children rarely, if ever, starve due to lack of money.

In fact, children do not starve due to lack of food.

They starve because their country's government either withholds it, or is so inefficient it cannot properly feed its citizens.

There's more than enough food to feed everyone on the planet, but a lot of it ends up going to waste.

M$ dollars (1)

selacious (101257) | more than 10 years ago | (#7236666)

How much of the $50 million do we think came from Micro$oft?

they follow what analyst said... (1)

SignificantBit (677809) | more than 10 years ago | (#7236667)

No wonder about this.. SCO Group was label as a "buy" [siliconvalley.com] by Deutsche Bank analyst on October 15th.

Re:they follow what analyst said... (1)

MikeXpop (614167) | more than 10 years ago | (#7236737)

Um, and rightfully so [yahoo.com]

At least for that day it was. Their stock doesn't seem to be following their financial troubles very well...

ARGH! (1)

Dragonshed (206590) | more than 10 years ago | (#7236671)

just fucking die. Your burial makes the world a better, safer place.

Another FC candidate gets VC funding.... (1)

jmorris42 (1458) | more than 10 years ago | (#7236675)

But it won't matter in the end. They are doomed and any idiot who invests in them or carries a long position in their stock is going to get screwed. Unfortunatly there is still a unhealthy supply of idiots handing out other people's cash trying to get the '90s levels of payback again.

All about BayStar Capital (1, Interesting)

Anonymous Coward | more than 10 years ago | (#7236676)

You have to remember who exactly BayStar Capital is.

They're the folks who are known for balancing several chairs on the nose of their chief executive. In fact, it's well known that the nose in question is big and powerful.

Therefore, it was only natural that they'd stick their nose up SCO's butt in hopes to find a prize.

Don't believe me? Check out their website.

In any case, I love their IT guy! Here's a quote from their website:

Steven Griffin is the Chief Technology Officer of BayStar Capital. Mr. Griffin brings ten years of information technology experience encompassing both the public and private sectors. Before joining BayStar Mr. Griffin was the Lead Systems Analyst at the San Bernardino County Fire Department.

From 1995 to 2000, he oversaw the San Bernardino County Fire Department's deployment of their wide area network and the maintenance management ERP project. From 1992 to 1995, Mr. Griffin worked as an independent contractor deploying local area networks for law offices and Realtors.

Mr. Griffin is currently pursuing his MS in Computer Science. He received his Bachelor of Science degree in Computer Science from California State University San Bernardino in 1998.


Wow! If he is their IT guy, I should be the Pope. Or even better.

Re:All about BayStar Capital (1)

mlk (18543) | more than 10 years ago | (#7236769)

CTO == The One That Knows What A Computer Is.

Hell, our CTO can't change his printer in Word.

I thought the 90's were over (1)

urubos (562290) | more than 10 years ago | (#7236678)

I could have sworn that investors dumping money into companys with failed buisness models was something that ended years ago.

i'm cursed (1)

double_plus_ungod (678733) | more than 10 years ago | (#7236681)

anything i touch becomes unlucky. to leverage the powers-of-the-ill-fated (tm), i guess i'll have to buy sco stock now. see how you handle _that_, sco.

Merry Christmas.... (2, Funny)

smd4985 (203677) | more than 10 years ago | (#7236683)

to David Boies. SCO will be taking caring of the next few generation of Boies' family....

Re:Merry Christmas.... (1)

Gojira Shipi-Taro (465802) | more than 10 years ago | (#7236792)

or somebody else will "take care" of them. Seriously. I'd be afraid to pull the kind of shit SCO and their allies are pulling. Eliminate the average man's ability to get back at you through the courts, and sooner or later he's going to say "screw the courts" and take matters into his own hands.

I wouldn't be doing what THESE morons are doing, that's for sure.

I love my family. I'm not sure about these creeps.

Cui bono (5, Interesting)

whig (6869) | more than 10 years ago | (#7236697)

Who controls BayStar?

Answer that question, and it will probably become obvious why they would be willing to "waste" $50 million.

SCO is just a foot soldier in a war that is being fought by Microsoft and associated proprietary software firms against the adoption of Linux as the dominant Operating System for the next century.

They are buying time, for one thing. Every day this FUD campaign drags on, slows the rate at which corporations switch their infrastructure to Linux. For all that those in the know realize what a crock of steaming shit this is, the courts are unpredictable at best, and PHB's are a conservative lot. Many won't bet their future on an OS which is the subject of litigation because they cannot be certain of the outcome.

SCO will die. But that's what foot soldiers do. Meantime, those pushing them forward are happy to lend them all the resources they need to prolong the fight.

Re:Cui bono (0)

Anonymous Coward | more than 10 years ago | (#7236797)

Who own's SCO?

Ask Scott McNealy

"I don't know what I would buy there. Why buy what you already own? I thought I already paid for that sucker."

http://www.eweek.com/article2/0,3959,1199992,00. as p

More fine investing with my retirement funds (1)

thogard (43403) | more than 10 years ago | (#7236704)

I'm glad I don't deal with them but the funds that I used to invest in had massive problems with stupid investments which is a common problem with mutual funds. They have $X amount of money they must invest every week. Then on the 1st and 15th they have $Y they also must invest. I'm sure its easy the 1st few weeks to find something good to invest in but after a while all the good stuff is gone and the law says it must be invested. Where is Fidelity going to put a billion dollers next week?

I just found out that the Aussie superannuation funds are now buying houses and empty lots. No wonder people can't afford homes anymore, clueless investment firms have billions of dollars they have to put somewhere and they only thing left is homes which they seem happy to pay double for. The super funds in Oz now have $130 million a week they have to invest which is 9% of the countries income.

Going for broke.. (1)

motherjoe (716821) | more than 10 years ago | (#7236706)

Sounds like they are going for broke. I wonder what the hell SCO is thinking, if they lose this and they will. Their new investors will be on them like a pack of ravenous wolves. McBride is obviously gambling the company on this. Just my.02

I started to read the announcement... (0)

shrugwhaa (696750) | more than 10 years ago | (#7236709)

and then I lost my appetite.

I sleep like a baby at night and have wonderful
vivid dreams.
I make a concious effort every day, all day, to be as honest as possible with myself
and those around me.

Life is a fabulous wonder with infinite resources
to explore...

I think it would be sickening to have to be
Darl's analyst. Can you even begin to imagine?

WTF (1)

Geminus (602334) | more than 10 years ago | (#7236713)

What the hell was this company thinking? When the hell will SCO just lie down and die? Is 99% of the community wrong or is it just companies like this? Assholes... lie down with dogs, get up with fleas. Geminus

cold fusion -- 100 million please (1)

gladbach (527602) | more than 10 years ago | (#7236714)

I have the forumla for working cold fusion. for 100 million dollars, I will hand over all details, patents pending, and copylefted material.

Please send a check or money order to...

oh wait... damn, never mind.

One more ring in the circus... (1)

AetherBurner (670629) | more than 10 years ago | (#7236715)

P.T. Barnum...your Magnum Opus has been proved again....

Obligatory post (1)

obsidianpreacher (316585) | more than 10 years ago | (#7236716)

Step 1) Give $50 million to a dying company
Step 2) ???
Step 3) Profit!

Good News for SCO (0, Flamebait)

Neural Assassin (611335) | more than 10 years ago | (#7236718)

Go SCO. Anything to rid the Earth of the Linux zealots.

Putting things into perspective (1)

RaySnake (607687) | more than 10 years ago | (#7236730)

Since SCO's market capatilization is only on the order of $250M this is a VERY sizeable addition to their coffers. On the bright side, this might lead them to a false sense of confidence about their position. In essence the perfect setup for humiliating public exposure of the falsity of thir claims

Re:Putting things into perspective (1)

benjamindees (441808) | more than 10 years ago | (#7236775)

Yeah, cause if there's something they don't have, it's ignorant confidence in the validity of their claims :)

Shut Up (0, Flamebait)

pinr (596626) | more than 10 years ago | (#7236731)

Why don't you shut up about this SCO shite.

This is where the open source lags (0)

Anonymous Coward | more than 10 years ago | (#7236736)

If there is any chance for open source to be successful, then by the actions of SCO it is diminishing. The problem is not the open source of course, but the system. The open source should adopt to the system and do something about these issues. Look how much vulnerable the open source is, SCO was able to make enough damage without even showing anything. How the hell can this happen?

If SCO can do this without showing code and yet having full access to the open source code, I am wondering this. How can open source coders audit companies with closed source? It looks like the real issue is that SCO can access to the Linux source code, yet open source programmers can not access to the souce code of companies, such as Apple, Adobe, or Microsoft.

Another important issue here is that, how do you accept code from submitters. If SCO succeeds from this ligitation, then who is going to stop companies from submitting their own source code and then demanding money after the program is adopted by millions of people. If the legal system in US allows SCO to collect money from Linux users, I have to say that open source is screwed totally. It will never be a significant player in computer industry.

More Jail time for Daryl et al (3, Funny)

the_other_one (178565) | more than 10 years ago | (#7236739)

Apparently they are not just smoking crack.
They are trafficing.

The real purpose of the cash (1)

althalus (520424) | more than 10 years ago | (#7236743)

In the PR, they say the cash is for development, but then stowell opens his mouth and...

The new cash sends a message. "For anyone out there that was doubting we had the necessary funds to fund that litigation, they should rest easy now," Stowell said.

Yeah, we knew that's what it was really for.

Any bets? (0)

Anonymous Coward | more than 10 years ago | (#7236749)


Anyone want to bet that BayStar Capital had an analyst or two, and maybe an IP lawyer, look at SCO's analysis and code under NDA before tossing $50,000,000 at them? What do you think they saw?

I don't think this bodes well for certain companies.

not sure this will help them with IBM.. (1)

marcushnk (90744) | more than 10 years ago | (#7236768)

as the chances are that they stipulated what the 50 mil is to be used for.. and they might think that their linux case is a waste of time.. they MAY have stipulated that they don't use the 50 mil for that case...

oh son of a ***** (1)

pergamon (4359) | more than 10 years ago | (#7236776)

you can't imagine the stream of obscenities that i just shouted

All depends on the odds... (2, Interesting)

jrrl (635743) | more than 10 years ago | (#7236784)

They are gambling, as with any investment. They seem to think there is enough of a chance that they will win, that they will get some return on the investment. Same thing as Deutsche Bank.

DB apparently thinks the odds are between 1 in 3 or 1 in 4 that they'll win. They see a $180 per share upside if SCO wins, but a zero value if they lose. So, if you look at it as P(win) * $180 + (1-P(win) * 0) = their target of $45. So, P(win) is 1/4.

Alternately, you can look at it as either $30 upside (from ~$15 (easy math, here folks, it's late)) vs. $15 downside. In which case, P(win) is 1/3.

If Baystar buys into those odds, then this is a good bet for them. Most venture capital funds are satisfied with one home run and two break-evens out of ten tries. This would be a home run for them if SCO wins. And $50M really isn't that much money.

All that said: Man, I want SCO to just go away!

Sigh.

BayStar doesn't necessarily believe in SCO (1)

mflaster (702697) | more than 10 years ago | (#7236785)

Just wanted to point out that BayStar doesn't necessarily have any belief in SCO at all.

They consummate the deal (or even before they do it), they hedge hedge hedge - i.e. short (close to) as many shares of SCO as they are getting in this deal. They will likely have a negative carry cost, meaning that they make money while holding a fully hedged position, because of the high dividend SCO is probably paying them.

And as someone else pointed out, these securities often have a "death spiral" feature - which means that if SCO stock goes down, BayStar gets more stock, and potentially makes more money.

No conspiracy theories needed - this is probably a great money maker for BayStar. And can you blame SCO for selling stock at these prices to raise cash???

Mike

Roxio is shit and so is SCO (1)

Monkelectric (546685) | more than 10 years ago | (#7236787)

why am I not suprised to see them used in the same sentence? :)

lets do something about it (0)

Anonymous Coward | more than 10 years ago | (#7236791)

we should spread the word, let people know what SCO is doing and why they shouldn't by their products.

Then we should sue em' to death!!!

I use to just hate M$... (1)

Rod76 (705840) | more than 10 years ago | (#7236795)

now i hate something more then M$... "SCO" I wish they would find something useful to do like develop something people need instead of attacking people for what it perceives as a threat to its "IP"

Roxio? (0)

Anonymous Coward | more than 10 years ago | (#7236798)

>> which has invested in Roxio

I read the article too quickly and was ready to quit my job tomorrow... lol

- roxio guy

BayStar == Slashdot... (0)

Anonymous Coward | more than 10 years ago | (#7236799)

They need something to post about!

Jackass Capital (0)

Anonymous Coward | more than 10 years ago | (#7236800)

Baystar Capital are jackasses. Take a look at their loser portfolio: a bunch of dotcompost companies and a sprinkling of biotech and pharamaceuticals. This SCO investment is their "long shot". Soon they'll be like a lot of other failed VC firms in Palo Alto, California. Ha ha ha. Jackasses!

Probably the Usual Suspects (2, Insightful)

kilgortrout (674919) | more than 10 years ago | (#7236806)

"private equity funding"?? Does anybody else think this deal smells? These guys are just a front for some private investors, i.e. they supposedly solicited the the investment from some third parties after putting together the package for an equity purchase in SCO. I wonder who those third parties are? Well you'll never know because it's a private placement. This is just a device for concealing who is really behind the funding. If your ever able to dig down through the byzantine structure of corporate, partnership and limited partnership entities that are the private investors, I think you know who you'll find at the bottom of the heap; those who have an interest in seeing this litigation continue regardless of its outcome.

It's the thought that counts (1)

HeX86 (536126) | more than 10 years ago | (#7236807)

... true story ...

Kaaa-Ching (1)

RichMan (8097) | more than 10 years ago | (#7236817)

I can't fathom the concept of investing in this company
--------------------

http://news.zdnet.co.uk/business/management/0,39 02 0654,39115337,00.htm

"We have an authorised capital of 45,000,000 shares of Common Stock, par value $0.001 per share... Our board of directors has authority, without action or vote of the shareholders, to issue all or part of the authorised but unissued shares," the statement said. "Any such issuance will dilute the percentage ownership of shareholders and may dilute the book value of our common stock".

Considering the company has only 13.5 million shares floating around, it is conceivable that the issuance of 45 million shares at a tenth of a cent each may dilute the list price somewhat.
-----
The current share price is over $15 yet the share value could be diluted by 3:1 (45:13.5) at $.001. What an equity suck that would be. Instant Kaa-Ching for any one the board wants to pay off. The source of the funds: stock value. No one should be coming within 3 brokers distance of this one.

Baystar Capital's web site (1)

Texas Rose on Lava L (712928) | more than 10 years ago | (#7236818)

If you take a look at their web site, you'll notice they have a picture of the Golden Gate Bridge. In light of their recent "investment" in SCO, I think the Brooklyn Bridge would be more appropriate.

More pump & dump (0, Redundant)

evocate (209951) | more than 10 years ago | (#7236827)

Tuesday afternoon Deutche Bank "initiated coverage" of SCOX with a Buy rating. They said SCOX is basically a call option on the legal proceedings. If SCOX loses, they expire worthless. If they win, the leverage will be tremendous. In the minds of investors who understand options but not software, this sounds like a pretty good deal. At least until they find out how slim SCO's chances of beating IBM really are. Then SCOX's price will seem a high call premium by any valuation model.

Today, another ringing endorsement from the financial world. Again, implying that this company is a safe and legit investment. But the press release is pretty thin: Baystar knows SCO is doing something with Unix, and they're suing people. The rest is Corporatese.

I think this is the new pump & dump plan: 1. whip out high profile financial hired guns to tout the stock and suck in the herds, 2. give 'em the signal when it's time to jump ship (judgement imminent), 3. profit!

no sig-r

um (1)

Newcastle22 (621052) | more than 10 years ago | (#7236828)

gay

50 Million (0)

Anonymous Coward | more than 10 years ago | (#7236831)

"This gives SCO a pretty big war chest to fight IBM..."
50 million vs IBM's warchest? suuuurre. :-)
Load More Comments
Slashdot Login

Need an Account?

Forgot your password?

Submission Text Formatting Tips

We support a small subset of HTML, namely these tags:

  • b
  • i
  • p
  • br
  • a
  • ol
  • ul
  • li
  • dl
  • dt
  • dd
  • em
  • strong
  • tt
  • blockquote
  • div
  • quote
  • ecode

"ecode" can be used for code snippets, for example:

<ecode>    while(1) { do_something(); } </ecode>