Software company Lernout & Hauspie Speech Products NV (L&H) is on track to meet a court-ordered restructuring plan, president and CEO Philippe Bodson said Friday.
The company has been talking to investors interested in buying part or all of its key technology in the form of a new company which would avert the need for bankruptcy, he told reporters on a conference call.
“What we are favoring right now is those people who are willing to take over the whole group of technologies with the most people, because that means they would maintain a big portion of our company working,” he said.
A U.S. bankruptcy court in Delaware has approved the sale of L&H’s translation unit, Mendez SA, to financial printing company Bowne & Co. Inc., he said. The deal, for US$44.5 million, was signed last week. Approval by a Belgian court is still pending.
L&H is under orders from the commercial court in Ieper, Belgium, to file an acceptable “restructuring and recovery” plan by Sept. 30. Bodson said management is still working to maintain the company as a going concern.
“If we do not succeed, then it will be a liquidation. Everybody will go, and a trustee will begin to sell assets,” he said. “That is something that we would like to avoid.”
Bodson declined to give details about potential bidders, but hinted that it is unlikely the company will find a buyer willing to invest the US$100 million or $125 million it would cost to maintain all of its current operations and employees.
About 600 people are employed in the company’s core activities, not including Mendez or the Dictaphone Corp., which is under U.S. Chapter 11 bankruptcy protection and is “operating without burning cash,” according to Bodson.
“I don’t believe we will receive an offer for the 600 people and the whole technology. This is in the eyes of the investors today much too risky,” he said.