SCO closes sale of Unix system to Nevada company
The venerable Unix computer operating system entered a new phase Monday with its sale by the bankrupt The SCO Group of Lindon to a group of investors who are pledging to spend millions to upgrade and expand it.
Unix was sold to UnXis Inc., a Nevada-based company formed by Stephen Norris Capital Partners and MerchantBridge Group to buy the system out of bankruptcy court in Delaware.
Unix, originally developed in the late '60s by Bell Laboratories, runs systems for some of world's biggest companies, as well as governments. Users include Sears, Rite Aid, McDonald's, Barclays bank and Citicorp, and it also runs air traffic control systems, ATM systems and F-16 fighter jets, said Richard Bolandz, CEO of UnXis.
"It's rock-solid engineering," he said. "That's what everyone says. It just works and works and works."
The new owners plan to pour an initial $5 million into the company to keep it operating and to rehire some of the people who have been laid off as SCO foundered in bankruptcy court, Bolandz said.
UnXis officials were scheduled on Tuesday to visit the Lindon offices, where one employee said only seven to eight people still worked, compared with 115 as recently as February 2008. Bolandz said no decisions have made on the number of people who might be hired or where they will be based.
The sale strips SCO of its only substantial asset, aside from the potential to earn millions of dollars from litigation it has against IBM and Novell. But the lawsuits alleging contract and copyright violations that began in 2003 eventually landed the Lindon company in bankruptcy court as it was drained by legal reversals.
Bolandz said the sale of Unix did not include the litigation, which remains with SCO.
Philadelphia attorney Edward Cahn, a former federal judge appointed by the court to oversee the company during bankruptcy proceedings, said SCO officials will wait until the 10th Circuit Court of Appeals opinion in the Novell copyright case before deciding whether to proceed with the lawsuits.
"We're all waiting for that decision to come down," he said.
Novell had objected to the sale of Unix for $600,000 but failed to challenge the order of the Delaware bankruptcy judge who approved the deal.
Jane Cavalier, a member of the UnXis transition team, said a decision will be made later on a more permanent name for the company.
"We're going to take the next 30 days to settle some matters in terms of what the corporate name and identity are going to be," she said.
But Bolandz said the new entity has set out an ambitious agenda to start issuing quarterly updates of the Unix system. Decisions on new products will be driven by what its users want, he said, but will include updates to current computing standards.
"We'd like to have consumer-driven product development," he said.
Part of the strategy will be to create systems based in banks of computers called clouds, where small- and medium-sized businesses can contract for services without having to actually own or maintain the equipment, Bolandz said.
Unix developed by AT&T's Bell Laboratories in late '60s.
Novell bought Unix in 1993.
Novell sold the system to The Santa Cruz Group in 1995.
Santa Cruz sold it in 2001 to Caldera International, which became The SCO Group of Lindon.
The SCO Group sold the system Monday to UnXis Inc.
Sources: Court documents and http://www.unix.org
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