Peregrine Systems

Last updated
Peregrine Systems, Inc.
Industry Computer software
Founded1981;43 years ago (1981)
Irvine, California, U.S.
FoundersChris Cole
Gary Story
Ed Beck
Kevin Keyes
Richard Diederich
FateAcquired by Hewlett-Packard in 2005 (2005)
Headquarters San Diego, California, U.S.
ProductsIT Management Software

Peregrine Systems, Inc. was an enterprise software company, founded in 1981, that sold enterprise asset management, change management, and ITIL-based IT service management software. Following an accounting scandal and bankruptcy in 2003, Peregrine was acquired by Hewlett-Packard in 2005. [1] Micro Focus which merged with the HP Software Division in 2017, later marketed the Peregrine products as part of its IT Service Management solutions. Micro Focus was acquired by OpenText in 2023.

Contents

History

Peregrine Systems was founded in 1981 in Irvine, California. The founders and employees were Chris Cole, Gary Story, Ed Beck, Kevin Keyes and Richard Diederich. They started selling Peregrine Network Management System (PNMS) on a Series One computer while developing an MVS version. The MVS client/server solutions for PNMS became available in 1995. [2]

In 1989, John Moores, founder of BMC Software and owner of the San Diego Padres Major League Baseball team, became a member of the Peregrine board of directors. He served as chairman from March 1990 through July 2000 and then again in 2002. [3] He resigned from the board in 2003 during the company's bankruptcy filing. [4] His involvement in the software industry continues today with investments through his venture capital firm JMI Equity. The legacy of his investments has been focused on ITSM software packages with the most recent investments made in ServiceNow. [5]

Peregrine had offices in the Americas, Europe and Asia Pacific and grew its product line rapidly both organically and via acquisitions, including Harbinger Corporation in 2000, [6] [7] and Remedy Corporation in 2001. [8] [9]

Fraud

In 2004, a federal grand jury issued an indictment charging eight former executives of Peregrine Systems, Inc., one former outside auditor of Peregrine, and two outside business partners of Peregrine, with conspiracy to commit a multibillion-dollar securities fraud. The case resulted from an investigation by the Federal Bureau of Investigation, and the Securities and Exchange Commission had pursued a parallel civil enforcement action. [10]

In 2003, the U.S. Securities and Exchange Commission charged Peregrine with "massive financial fraud" for the purposes of inflating the company's revenue and stock price. [11] Peregrine, without admitting or denying the allegations of the complaint, agreed to a partial settlement. [12]

Peregrine filed suit against its auditor Arthur Andersen in 2002 for $1 billion in damages, for allegedly allowing incorrect audits that overstated revenues by as much as $250 million to be filed for the 2000-2002 fiscal years. [13] In 2003, the former Peregrine CFO, Matthew Gless, pleaded guilty to fraud charges. [14] [15] In 2008, the former Peregrine CEO, Stephen Gardner, was sentenced to eight years and one month in prison for his role in the fraud, which resulted in bankruptcy for the company. [16] [17] Although former chairman of the board, John Moores, sold more than $800 million of shares during Peregrine's fraudulent period, the court of appeals determined that there was insufficient evidence that Moores knew about the fraud that led to the company's bankruptcy. [18]

Sentences

Charges dismissed:

Bankruptcy

Peregrine filed for Chapter 11 protection on September 23, 2002, after laying off 1400 employees, or nearly half its workforce. [38] When Peregrine filed for federal bankruptcy protection and eventually canceled its common stocks, more than $4 billion in shareholder equity was lost. [39] After filing, the company sold the Remedy division of the company to BMC Software for more than $300 million. Peregrine exited Chapter 11 reorganization in August 2003, and the president and CEO, Gary Greenfield, left the company. Retired software executive John Mutch became president and CEO in August 2003. [40]

Sale to HP

Hewlett-Packard acquired Peregrine Systems in 2005 for $425 million. [41] The Peregrine products are now sold as part of the HP IT Management Software (BTO) portfolio within the HP Software Division.

Products

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