Restructuring, Acquisition and Other Charges

9 Months Ended

Oct. 31, 2013

Restructuring And Related Activities [Abstract]

Restructuring, Acquisition and Other Charges

5. RESTRUCTURING, ACQUISITION AND OTHER CHARGES

Restructuring, acquisition and other charges are recorded as a separate line within the condensed consolidated statements of comprehensive income (loss). Restructuring, acquisition and other charges consisted of the following (in thousands):

	Three Months Ended October 31,					Nine Months Ended October 31,
	2013		2012			2013		2012
Restructuring	$	3,861	$	(71	)	$	12,197	$	(71	)
Acquisition and Other Charges:
Acquisitions and costs related to issuance of debt		31		30			94		88
Sponsor and administration fees paid to Silver Lake		—		281			132		844
Severance, facility and other charges not part of restructuring and not part of ongoing operations		58		1,025			392		2,413
Total	$	3,950	$	1,265		$	12,815	$	3,274

In February 2013, the Company initiated a restructuring plan in response to a decline in revenues and to better align its business operations to market opportunities. In June 2013, the Company initiated a more significant restructuring plan to refocus the Company’s strategy on its core mainframe and distributed system products and new release management products, re-organize and enhance the geographical focus of the Company’s sales organization and re-align the cost structure of the Company based on these actions.

As part of these restructuring plans, the Company reduced its workforce by approximately 8% (55 employees) in the three months ended April 30, 2013 and approximately 24% (120 employees) in the three months ended July 31, 2013. These actions affected all parts of the organization through workforce reductions worldwide and facility closures and reductions in North America, Europe and Asia. The additional restructuring expense in the three months ended October 31, 2013 resulted primarily from the completion of facility reductions.

The Company realized, and expects to continue to realize, cost savings going forward as a result of these restructurings. In connection with these actions, the Company recorded net restructuring charges of $12.2 million during the nine months ended October 31, 2013 consisting principally of severance, payroll taxes, employee benefits, and facility restructuring charges. Restructuring charges were based on the Company’s restructuring plans that were committed to by management. Any changes in the cost estimates of executing the approved plans are reflected in the Company’s results of operations. Restructuring liabilities are reported within other accrued expenses in the condensed consolidated balance sheets.

The following table summarizes restructuring charges accrued and paid/written-off as of October 31, 2013 by category (in thousands):

	Severance, payroll taxes and other employee benefits			Facilities closures, legal and other miscellaneous			Total restructuring charges and accruals
Balances as of January 31, 2013	$	—		$	—		$	—
Activity during the nine months ended October 31, 2013:
Accrued	$	6,853		$	5,344		$	12,197
Paid/written-off		(6,478	)		(1,287	)		(7,765	)
Balances as of October 31, 2013	$	375		$	4,057		$	4,432