Loudcloud Completes $63M Sale

Its name also changed to Opsware Inc.

The sale to the Plano, Texas-based computer systems consultant allows the newly minted Opsware to concentrate on making software that helps other companies run their information technology departments.

As part of a deal announced in June, EDS also agreed to buy $52 million worth of Opsware's software during the next three years.

LoudCloud co-founder Marc Andreessen, Opsware's chairman and largest shareholder, is counting on the Sunnyvale-based company to fare better in its new incarnation than it did as a Web hosting business.

After Andreessen co-founded Loudcloud in 1999, the company lost nearly $500 million and never caught on with investors after its March 2001 initial public offering of $6 per share.

Loudcloud's struggles contrasted sharply with the early success of Andreessen's previous high-tech creation, Netscape Communications, the maker of the Web's first commercial browser.

Andreessen blamed Loudcloud's demise on the tough times in the high-tech industry , a factor that he believes might help Opsware.

"It's much easier to start a company in a pit than when things are at the top," Andreessen said in an interview.

He pointed out that some of the nation's biggest high-tech companies--Oracle, Microsoft, Dell Computer and Cisco Systems--started out during industry downturns.

Copyright © 2002 The Associated Press. All rights reserved. The information contained in the AP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of The Associated Press.