Wednesday, January 20, 2010

Verari to Get New Life Post Carlyle Group

Verari Systems failed when cash flow couldn't cover debt payments. It's the latest failure for The Carlyle Group, denting the private equity underwriter's (PEU's) storied reputation. The San Diego Union Tribune reported:

A private investor group led by the founder of Verari Systems has purchased the assets of the failed San Diego rack server company and plans to restart it under a new name, Verari Technologies.

Verari, which makes high-performance computing systems, laid off the vast majority of its 235 employees last month.

The new owners plan to hire 60 employees. It's not life in the PEU fast lane. Verari has a tough road to hoe. But they won't have a 2% Carlyle management fee or be weighed down by debt.

Update:  Former CEO David Driggers bought Verari in liquidation.  In a dig to Carlyle his new tagline is "Same technology. Better company."