Burroughs Says It May Increase Bid for Sperry

Burroughs Corp. is “prepared to negotiate a meaningful increase” to its $4.06-billion takeover offer for New York-based computer maker Sperry Corp., Burroughs Chairman W. Michael Blumenthal said Thursday.

His remarks came in a letter to Sperry Chairman Gerald P. Probst that was drafted in response to Sperry’s rejection on Wednesday of Burrough’s $70-a-share offer for the fifth-ranked computer company.

There was no immediate reply from Sperry, which has countered Burrough’s offer with a conditional $80-a-share offer for 29.5 million of its own shares.

Ready to Meet With Sperry

Blumenthal, saying he was in New York and ready to meet with Probst, also warned that Burroughs “does not want to see Sperry dismembered or engaged in complex financial maneuvers to frustrate what we believe would be an ideal marriage.” Such moves would probably have the effect of “reducing the value of Sperry to us,” he said.

News of the letter sent Sperry stock spurting and forced the New York Stock Exchange to halt trading because of an order imbalance. Trading was halted at 3:05 p.m. EDT and resumed at 3:30 p.m.

In composite trading, Sperry stock rose 37 1/2 cents a share to $73.25. Burroughs dipped 87 1/2 cents a share to $59.

Several analysts said the announcement was not unexpected and would be a prelude to negotiations between the companies.

Sperry Files Suit

“Sperry may not want to negotiate, but they realize they have no choice,” said George D. Elling, an analyst with Oppenheimer & Co. in New York.

He said Blumenthal’s warning against a selloff of Sperry assets or financial maneuvering “was to tell them that those actions would hurt everyone.”

Separately, Sperry brought a lawsuit asking Delaware Chancery Court to declare its $80-a-share offer legal and to prevent Burroughs from beginning legal proceedings in any other state. Sperry wants the suit to be conducted in Delaware court because Delaware, unlike other states, has judged that companies can exclude certain parties from tender offers.

Sperry’s offer stipulates that it will not accept shares tendered by Burroughs.