Maureen O'Gara reports: Garnett & Helfrich Capital, the venture buyout firm dedicated to finding "broken and orphaned" businesses neglected by their parents, finally got around to admitting its interest in Wyse Technology the other day.

It's had one of its boys running the joint since at least last October and now it says it's bought a controlling stake in the flagging $175 million-a-year company from the Koos Group in Taiwan for $35 million. The deal reportedly closed a week ago Tuesday.

It's Garnett & Helfrich's first investment out of the $250 million war chest it put together a year ago from some plum funds like the Harvard and Stanford endowments. Garnett & Helfrich is also rumored to have its eye on Ingres, the database that Computer Associates owns and open sourced.

Anyway, the idea is to reposition Wyse for growth and Garnett & Helfrich, which is shaping Wyse's latest corporate and product strategy, wants to increase Wyse's revenues to a billion dollars by 2010 on the expectation that thin clients will develop into a multibillion-dollar market in the next three to five years.

Theoretically this means new, invigorated competition in the thin-client market, which Neoware is currently seeking to dominate. Naturally, Wyse and Neoware, which inherited IBM's thin client business, are expected to clash.

Wyse claims to be the world leader in thin clients with 35% market share, down from 50% in the last four years or so. It says its customers represent 40% of the Fortune 100. Neoware, by contrast, claims 20% of the market and rising. HP is the only other significant player with about 15% of the market.

Reports say Wyse's management has been almost completely turned over and Neoware CEO Michael Kantrowitz claims that Wyse is going to be "challenged" since the guys who've taken over don't know the business and haven't retained the folks who do.

Having done eight acquisitions in the last five years, Kantrowitz claims the trick is motivating existing staff.

John Kish, a Garnett & Helfrich sole CEO-in-residence before he was detailed to Wyse last year, made his bones running Oracle's Desktop Products Division years ago, a unit that grew to $400 million in revenues.

Kish was subsequently involved with four venture-backed start-ups including Cacheon and Domain Solutions Corporation, a 1996 management buy-out from Bolt Beranek and Newman (BBN).

Oracle conceived of the idea of a thin client and an Oracle guy by the name of Tim Negris came up with the name thin client, but Oracle never got it off the floor.

Back in October, Garnett & Helfrich also hired Wolfgang Staehle, ex of IBM, BBN, Domain Solutions and Akamai Technologies, to run EMEA for Wyse. Robbie Robinson, formerly of IBM, Oracle, BT and Energis, has also joined Wyse as senior VP, worldwide sales.