SCO, once the leading Unix supplier in the world, has come to the end of a long and bumpy road by filing for protection under Chapter 11 of the US bankruptcy laws.
The company, which has spent the last few years involved in contentious litigation which ended with Novell winning the rights to the Unix kernel, has filed a voluntary petition for reorganisation under Chapter 11.
SCO's subsidiary, SCO Operations, has also filed a petition for reorganisation.
The Board of Directors of The SCO Group have unanimously determined that Chapter 11 reorganisation is in the best long-term interest of SCO and its subsidiaries, as well as its customers, shareholders, and employees.
Under US bankruptcy laws, companies under Chapter 11 are protected from their creditors while the attempt to reoranganise their operations – in many respects it is similar to A local company being place under judicial management by the South African courts.
Chapter 11 is not an application for liquidation, although it could lead to that should a reorganisation fail to bring the company back to viability.
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 reorganisation 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," says Darl McBride, president and CEO of the SCO Group.
"Chapter 11 reorganisation 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 its commitments to customers. The motions also address SCO's continued ability to pay its vendors, the retention of various professional advisors, and other matters.