Peregrine Plans To Lay Off 1,400

Peregrine officials said Tuesday the company will reduce the number of employees from 2,900 to 1,500 --or about 48 percent--in its U.S. offices. It was not immediately known how many locations would be closed.

"We've had to take difficult, but necessary, steps to reposition our company in line with current market conditions, and this work force reduction will help Peregrine sustain long-term viability," said Gary Greenfield, who was named chief executive two weeks ago. "These actions will have minimal impact on our customers and the level of services and support we offer."

Peregrine admitted it may have overstated as much as $100 million in revenue. The company is under formal investigation by the Securities and Exchange Commission and said it will restate three years of earnings.

Peregrine fired Arthur Andersen as its auditor April 2 and fired its replacement auditor, KPMG, at the end of May. KPMG then sent the SEC a letter, alleging possible fraud at the company.

After the auditing firms were fired, Steve Gardner stepped down as board chairman and chief executive, while Matt Gless resigned as chief financial officer and executive vice president of finance.

Greenfield, who was named CEO June 3, previously was president and CEO of Merant Inc., a publicly traded e-business development company, and was an adviser to private venture capital firms JMI Equity Fund and Lazard Technology Partners.

Peregrine has lost about two-thirds of the value of its shares since the executives' departure and shareholders have filed civil lawsuits against Peregrine.

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