Some of you might recollect, as I do, the prior incarnation of Liberate Technologies, when it was a vendor of software for digital cable-television systems, including set-top boxes.
As this cached SEC filing attests, Liberate essentially wound up that business last year when it sold its North American assets to Double C Technologies, LLC, a joint venture majority owned and controlled by Comcast Corporation with a minority investment by Cox Communications, Inc. That asset sale closed in April of last year, with Liberate receiving approximately $82 million in cash.
Subsequently, Liberate sold the remainder of its business assets to SeaChange International, Inc. That left Liberate with no product- or service-related business to operate on an ongoing basis. As Liberate put it in its Form 10K issued on August 15, 2005:
We will continue to operate Liberate to resolve existing liabilities, prosecute and defend pending litigation and pursue other claims as appropriate that we may have against third parties, and dispose of non-operating assets to maximize shareholder interest. Although our board of directors has not yet made any determination, we also will continue from time to time to evaluate and potentially explore all available alternatives including a dissolution and liquidation of Liberate, a share repurchase, an extraordinary dividend or other transactions to maximize stockholder value. We believe that our cash, together with the proceeds from Asset Sales, will be sufficient to meet our working capital requirements for the next twelve months. In fiscal 2006, we expect to continue to use net cash to fund our operating activities.
Apparently, Liberate Technologies has found a business it would like to enter. You’re probably thinking it’s a technology business, somewhat related to the markets and technologies in which the company had been involved previously. Well, you’d be wrong.
As a result, Liberate’s CEO, Paul Vachon, has gone to the extraordinary lengths of publishing an open letter, addressed to Jerry D. Orler, USA Truck’s president, in the guise of a press release. You have to read it to believe it. Basically, Liberate wants to take USA Truck private, and it’s willing pay a decent premium to do so.
How many other failed technology firms, literally shells of their former selves, will take this route? Are we about to witness a trucking bubble paralleling the technology bubble of a few years back?
I’m being facetious, of course, but I think it’s fascinating that a former technology company is attempting to remake itself as a acquirer of decidedly old-school companies in industries such as commercial transport.
For those of who hadn’t noticed, or who are in a persistent state of obdurate denial, this is just another data point emphatically stating that we aren’t in the late 90s anymore.