SCO Group scores US$50M in equity financing

The SCO Group has secured US$50 million in equity financing, which will be used for projects such as funding legal costs associated with the company's Linux intellectual property initiatives.

The private investment is being led by investment fund BayStar Capital, according to a statement issued by The SCO Group.

Kieran O'Shaughnessy, regional general manager ANZ at The SCO Group, told iTnews that its business had improved dramatically over the past 12 months, to a point where it was very attractive to fund companies. "So it's a great opportunity for us to go to funding organisations and be able to negotiate with them on a sound footing," O'Shaughnessy.

He said that the financing the company had secured would be used to fund ongoing development, such as taking some new products and strategies to market. It would also be used to fund legal costs in SCO's Linux intellectual property initiatives, O'Shaughnessy said.

According to a statement issued by SCO, this would include future UNIX and SCOx web services software development.

The investment in SCO being led by BayStar Capital, has been structured as a private placement of non-voting Series A Convertible Preferred Shares, which are convertible into common equity at a fixed conversion price of US$16.93 per share, it stated.

Darl McBride, president and CEO of The SCO Group said it had been making "significant strides" in protecting its intellectual property rights during recent months. McBride said it would be informing the industry and Wall Street with outlines of its plans in coming weeks.