8 August 2003 Peregrine Systems, the asset management software supplier, emerged from Chapter 11 bankruptcy proceedings this week and paid tribute to customers that stayed loyal throughout the almost year-long process.
Company executives said yesterday that Peregrine was the first publicly-held enterprise software company to successfully reorganise under Chapter 11 of the US bankruptcy code.
It said it had slashed expenses, shed assets and replaced some of its former executives, while many of its creditors had been repaid in full. Last month, a court in Delaware approved the company’s reorganisation plan, which took effect yesterday – marking the formal end of the Chapter 11 process.
“Last year was a remarkable one for Peregrine. We owe our success to the loyalty of our customers and partners, and an extraordinary commitment among employees worldwide to move the company forward,” said Peregrine’s CEO, Gary Greenfield.
Peregrine’s 3,500 customers include Panasonic, Bayer, Swiss Life and Lufthansa. Some of those have increased spending on Peregrine products even through the Chapter 11 period. “We have been committed to Peregrine for 14 years,” said Jorg Matz, a senior consultant at Lufthansa. “Last year, we enhanced the solution by implementing ‘AssetCenter’ and all ‘Get-It’ modules.”
Peregrine filed for Chapter 11 protection from its creditors in September 2002 after accounting irregularities came to light, requiring a restatement of results from 2000-2002. The restatement reduced revenues by almost 40%, or $509 million.
In November 2002, the company sold its ‘Remedy’ help-desk software division to BMC Software for $355 million.
Earlier this year, the company’s former CFO pleaded guilty to conspiracy and securities fraud. Its ex-assistant treasurer pleaded guilty to conspiracy to commit bank fraud in November 2002. A former sales manager in June 2003 pleaded guilty to a charge of conspiracy to commit securities fraud.
The company recently settled civil charges brought by the US stock-market watchdog, the Securities and Exchange Commission, without admitting or denying allegations of financial fraud.
A separate inquiry by the US Department of Justice into the company’s accounts is ongoing.