BMC Software Inc. announced yesterday that it has agreed to purchase the Remedy assets from Peregrine Systems Inc., which filed Monday for reorganization under Chapter 11 Bankruptcy rules.
BMC will pay $350 million in cash, plus the assumption of liabilities of Remedy, for the asset management unit.
As part of the agreement, BMC also agreed to provide the ailing Peregrine Systems with debtor-in-possession financing of up to $110 million, to be netted against the purchase price.
Peregrine has been facing increasingly dire circumstances since last spring, when officials at the San Diego, Calif., company announced they would have to restate up to three years earnings because of accounting improprieties. Following that announcement, top management scattered—including the CEO and CFO—the companys stock price tumbled, and late last month Peregrine was delisted from the Nasdaq stock market.
Earlier, in June, Peregrine sold its Supply Chain Enablement division, made up of two separate acquisitions, Extricity Inc. and Harbinger Corp.
Remedy provides service desk and asset management software—an area Peregrine had hoped to focus on moving forward, when its troubles began.
The Remedy transactions with BMC are subject to a number of conditions before going through, including U.S. Bankruptcy Court and regulatory approvals.
Under the terms of the agreement, BMC will acquire all of Remedys assets, including its Remedy applications, IT Service Management, Customer Service and Support solutions, and the Action Request System, a development platform.
Once the acquisition is complete, Remedy will act as a separate business unit within BMC, which looks to be the leader in the enterprise management market.
BMC will combine its enterprise management software with Remedy to provide an integrated IT and service process view for companies to utilize in running their business.
Bob Beauchamp, president and CEO of BMC, said in a press release that his company has long recognized the strength and market leadership of Remedy—even under difficult circumstances.
"This acquisition is about fostering growth, and with the financial strength of BMC customers can be assured that Remedy is better positioned now more than ever to continue to deliver value added solutions to the market," said Beauchamp in Houston, Texas.
Remedy has about 6,000 customers worldwide and generated about $250 million in revenues between June 2001 and June 2002, officials said.
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