BearingPoint Breaking Up
One of the biggest companies in the Microsoft partner ecosystem will apparently be no more.
BearingPoint Inc., which filed for bankruptcy in February, is now making arrangements to sell off "substantially all" of its businesses to competitors.
In a statement this week, McLean, Va.-based BearingPoint announced an agreement to sell its Public Services business to Deloitte for $350 million and a non-binding letter of intent to sell its Financial Services segment to PricewaterhouseCoopers (PwC) LLP for $25 million. BearingPoint is also in negotiations to sell its Japanese consulting practice to a PwC subsidiary in Japan.
Those deals and a number of other regional deals that BearingPoint management is negotiating would all have to be approved by the bankruptcy court.
The management and technology consultancy, which lost $30 million on revenues of $801 million in the third quarter of 2008, is one of the largest Microsoft Gold Certified Partner companies. Of its 15,000 employees, more than 2,000 have Microsoft training.
The recession hasn't helped BearingPoint, but the company's problems stem from debt built up during an acquisition spree from 1999 to 2002 as the company was being spun off from KPMG LLP.
BearingPoint spent all of 2008 trying to find a buyer. Despite negotiations with 25 potential suitors, the company couldn't reach a deal and filed for Chapter 11 reorganization ahead of an April 15 deadline to pay off $200 million to creditors and a probable delisting from the New York Stock Exchange.
In a sad tie-in to current events, The Wall Street Journal reported Wednesday that BearingPoint is seeking separate bankruptcy court approval to pay $10.7 million in bonuses to a dozen top executives, including BearingPoint CEO Ed Harbach.
Posted by Scott Bekker on March 26, 2009 at 11:58 AM