French bail out Bull with $690m
Mouth to wallet
French server maker Bull is being bailed out again. The European Commission has given the go ahead for the French government to toss Bull an impressive €517m ($690m) subject to a few terms and conditions. In addition, Bull announced today that it has tapped ex-IBMer Didier Lamouche to be its next chairman, starting 1 Feb.
All in all, it has been a busy day for the beleaguered Bull. The company announced that it will receive its new handout in January if it can repay a €450m bailout provided by the French government back in 2002. Bull must also pay the French government 23.5 per cent of its pre-tax profits over an eight-year period starting in 2005.
"The plan involves a steep reduction in overheads, a payroll cut to 7,800... and refocusing on the company’s strengths: GCOS proprietary servers, IT services linked to its branded products, and development of a new range of open servers," the EC said in a statement.
Bull has struggled to compete against US server makers IBM, HP, Sun Microsystems and Dell. It, however, seems determined to keep on fighting in the European server market.
Lamouche will be in charge of helping Bull make good on its aid and reinvigorating the company. He will replace current chairman Gervais Pellissier, who will step down at the end of January.
All might not be as bleak as it seems for Bull. It absolutely hammered Dell in Itanium server sales during the second quarter. Bull shipped a whopping 80 Itanium servers worth $5m compared to Dell's 187 shipments worth just $4m. This impressive showing makes Bull one of the major players in the Itanium market.
And before all you US capitalists get upset by the French aid for Bull, remember that Cray and a few other US firms receive sizable handouts from the US government. ®