Read it one record at a time:

open(INPUT,"filename.txt") or die "Will not open input: $!";
open(OUTPUT,">output.txt") or die "Will not open output: $!";

local $/ = \164;
while( <INPUT> ) { ## Updated per jwkrahn's post below
    print OUTPUT "$_\n";
}
close OUTPUT;
close INPUT;
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BTW: The semicolon after open(OUTPUT,">output.txt"); is kinda a givaway that you didn't have the error checking :)

As a one-liner:

perl -ple"BEGIN{$/=\164}" filename.txt >output.txt
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