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Update: SCO Group Files Chapter 11 to Protect Assets as It Addresses Potential Financial, Legal Challenges

The SCO Group, Inc., a leading provider of UNIX software
technology and mobile services, today announced that it filed a
voluntary petition for reorganization under Chapter 11 of the
United States Bankruptcy Code. SCO’s subsidiary, SCO Operations,
Inc., has also filed a petition for reorganization. The Board of
Directors of The SCO Group have unanimously determined that Chapter
11 reorganization is in the best long-term interest of SCO and its
subsidiaries, as well as its customers, shareholders, and
employees.

The SCO Group intends to maintain all normal business operations
throughout the bankruptcy proceedings. Subject to court approval,
SCO and its subsidiaries will use the cash flow from their
consolidated operations to meet their capital needs during the
reorganization process.

“We want to assure our customers and partners that they can
continue to rely on SCO products, support and services for their
business critical operations,” said Darl McBride, President and
CEO, The SCO Group. “Chapter 11 reorganization provides the Company
with an opportunity to protect its assets during this time while
focusing on building our future plans.”

The SCO Group has filed a series of first day motions in the
Bankruptcy Court to ensure that it will not have any interruption
in maintaining and honoring all of its commitments to its
customers. The motions also address SCO’s continued ability to pay
its vendors, the retention of various professional advisors, and
other matters.

Groklaw: SCO Files For Chapter 11 Bankruptcy – Updated

“Stephen Shankland reports that this means the trial on Monday
is off:

“IBM didn’t comment, but Novell said it is evaluating its
options. ‘U.S. bankruptcy law automatically stays the court case.
We’re assessing our options for how to pursue our interests,’
Novell said.

“Novell sure has had to work hard for their money. And now they
will have to row the boat that little bit harder. And for those of
you who bought airline tickets to go to the trial, get on the phone
or online fast and cancel…”

Complete
Story