BearingPoint has reached deals to sell its public services business and substantial portions of its commercial services business, and is in negotiations to sell its other businesses, according to the McLean, Va.-based solution provider.
BearingPoint has entered into an asset purchase agreement with Deloitte to purchase significant portions of its public services business for $350 million. BearingPoint must still consider all "higher and better" offers and obtain court approval, according to the company.
In addition, BearingPoint has signed a nonbinding letter of intent to sell a substantial portion of its North American Commercial Services business, including its Financial Services segment, to PricewaterhouseCoopers for $25 million. PwC Advisory Co., a PricewaterhouseCoopers firm operating in Japan, is also in advanced negotiations to acquire the company's consulting practice in Japan, according to BearingPoint.
The solution provider, No. 27 on the 2008 VARBusiness 500, is also in "late-stage negotiations" to sell its European and Latin America practices, and is talking with interested parties to sell other businesses in Asia Pacific.
"Since we entered the restructuring process, we've been committed to evaluating all strategic options with the goal of charting the best possible course for the people, clients and creditors of BearingPoint," said Ed Harbach, BearingPoint CEO, in a statement.
Last month, BearingPoint announced it planned a restructuring and filing for Chapter 11 bankruptcy. At the time, BearingPoint arranged a deal with its creditors under which approximately $1 billion in debt is reduced to about $300 million in debt plus new stock, a company spokesperson said.
The sale of BearingPoint's businesses is the "logical conclusion of the struggles and failed restructuring program the company has unsuccessfully wrestled with for many months," according to analyst firm Technology Business Research.
The sales are in the best interests of BearingPoint, its partners and customers, according to TBR.
"The company had endured accounting and financial troubles going back to 2004 and, despite the resolution of its accounting mess in late 2007, it has been unable to stabilize the business, successfully attract and retain talent, and expand its pipeline and book of business to sustain ongoing operations," TBR wrote in an e-mail.