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Sun moves to quell reports that inventor of the original Sun workstation, Andreas von Bechtolsheim, is leaving the troubled systems vendor just as a private equity firm takes a major stake

Sun Microsystems has refuted reports that the company's co-founder and star engineer Andreas von Bechtolsheim is resigning, issuing a statement saying he would continue to work at the company "in a reduced capacity."

Bechtolsheim will continue to work with the Sun Systems group but will also focus on his role as chief development officer of Arista Networks, a network switch manufacturing start-up.

"Andy has made a career of entrepreneurial ventures, and we look forward to his continued involvement with Sun as his passion for innovation has helped to pioneer some of the world's leading technologies," said Sun spokeswoman Dana Lengkeek.

Reports of Bechtolsheim's departure coincided with the news that a private equity firm named Southeastern Asset Management bought a 21.2% percent stake in the company, just days after Sun issued a loss warning to investors causing its share price to fall by 17.5%.

Bechtolsheim founded Sun with current chairman Scott McNealy, and was responsible for designing the company's first workstation in the 1980s. He left Sun for nearly a decade to run two start-up companies, returning in 2004 to overhaul the company’s product line in a bid to pull it out of its post dot-com fiscal woes.

Meanwhile, Sun yesterday revealed that its management had met with Southeastern, which now holds the largest stake in the company, following its share buyout to discuss strategy. In a shareholder meeting earlier this year, Southeastern president Staley Cates said that he saw Sun becoming more of a software company than a hardware company.

Sun Microsystems, which suffered badly during the post-dot com crash, has in recent times pinned its hopes to a 'commercial open source' business model, making much of its software freely available in the hope of cross-selling configured hardware.

But this strategy has yet to pay dividends. In May 2008, Sun announced that it would be making 1,500 lay-offs to reduce operational costs.

At a recent event celebrating the opening of the Sun's new executive briefing centre in Scotland, executives asked journalists present to look at the wider picture, rather than quarter-by-quarter results.

The company issues formal results on 30 October.

Further reading

Sun reveals the secrets of 'commercial open source'
How the systems and hardware vendor puts aims to make money from 'free' software

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