The Santa Cruz Operation (SCO), which has been buffeted by two straight quarters of losses and last week announced a 19 per cent workforce reduction, today said it has received a much-needed cash infusion amounting to $13.1 million.
The struggling software vendor said the new financing is coming through a private placement facilitated by Security Research Associates, a brokerage firm that plans to sell 3.3 million shares of SCO's stock to its clients.
Also included are warrants that could be used to buy more SCO shares or the stock of Linux vendor, Caldera that's buying SCO's Unix server and professional services business units under a deal announced last month.
SCO said the cash infusion will provide funding needed to develop its Web-based Tarantella software, the one business unit that the company - which is in the process of changing its name to Tarantella - will continue to own after the sale of the other two operations to Caldera is completed.
The Tarentella product can be used to connect multiple applications via the Internet, according to SCO. Mike Orr, president of the company's Tarantella division, said in a statement today the new financing will "place us in a much stronger position" to capitalise on the software and meet projected growth targets.
Recently, SCO said it would lay off 190 workers to prepare for the Unix server and professional services sell-off to Caldera. The deal with Caldera came shortly after SCO reported a loss of $19.2 million on revenue of $26.9 million for its third fiscal quarter ended June 30.