announced Thursday after the close that it nabbed $50 million in private funding, buying more time and money in its fight against
over the Linux operating system.
SCO said the private investment was led by BayStar Capital, a Larkspur, Calif.-based investment fund that specializes in equity placements in publicly traded companies.
The SCO investors receive nonvoting Series A preferred shares, convertible into common stock at a fixed conversion rate of $16.93 a share. That was the average closing bid price for the company's common stock for the five previous trading days prior to closing the deal.
Shares of SCO declined 61 cents, or 3%, to close Thursday at $19.89 before declining slightly to $19.60 in after-hours trading.
The private placement gives SCO a financial boost in its legal battle against IBM, bringing the company's cash balance to $61 million. Earlier this year, the Linden, Utah-based company sued IBM, charging that the technology behemoth breached a contract by misappropriating SCO's UNIX Code in IBM's Linux business.
Upon conversion, BayStar will own nearly 3 million shares of SCO stock, or 17.5% of shares outstanding. The firm's past investments include
, and both
Sirius Satellite Radio
XM Satellite Radio