Top Sperry Managers to Get Key Positions After Merger

Burroughs Chairman W. Michael Blumenthal and Sperry Chairman Gerald G. Probst, recent adversaries in a bitter takeover battle, made their first joint public appearance Wednesday and announced that Probst and Sperry President Joseph J. Kroger will hold key posts when the computer firms merge.

Addressing a Manhattan press conference, Blumenthal said Probst will be vice chairman while Kroger will be president of its Sperry division. The pair will also sit on the new company’s board of directors, as will up to four other current Sperry directors.

The companies “will build a major new force in information systems,” Blumenthal declared.

After long resisting Burroughs’ overtures, Sperry announced Tuesday that it would accept a $4.8-billion merger offer in a deal that will create the nation’s second-largest computer concern.

The executives used the appearance to try to reassure customers and employees, but they left unanswered several questions that remain about the deal. Blumenthal waved off questions about how the companies will be combined or how they intend to cut costs and thin ranks.

Talk of layoffs was “absolutely premature and out of place,” he said, adding that layoffs will “not be the major way to get savings.”

Blumenthal declined to discuss in any detail what strategy the company will pursue in taking on the much larger No. 1 computer maker, IBM.

He promised, however, that the two companies will have a stronger balance sheet and higher per-share earnings as early as next year. In meetings with analysts, he has predicted that the two companies’ earnings would be between $8 and $9 a share on a fully diluted basis.

The companies, said Blumenthal, are “totally committed to maintaining . . . and growing the key mainframe architectures and structures of the two companies.”

Probst acknowledged that Sperry computer customers are “nervous” that the merger might threaten the product-development and service that computer users depend on.

But Blumenthal insisted that the union will enable the companies to accelerate research and development, offer a broader product line and better field service.

Probst said he supported the merger, but he declined to disclose how he, Kroger or other board members voted on the final $76.50-a-share offer. He also noted that Sperry’s board remained confident until the end about its 3-year-old strategy of selling off unrelated operations to concentrate on its core computer and high-tech defense businesses.

“We were totally convinced we could be an independent company . . . and a viable competitor to IBM,” he said, adding that “we recognized that being a public company, we aren’t always masters of our own destiny.”

Analysts say Sperry was forced to yield to Burroughs when Sperry failed to find a more desirable merger partner--a “white knight”--and when it confronted ever-higher bid prices that were steadily increasing shareholder pressure for a merger.

Probst denied suggestions from reporters that the two chairmen appeared uncomfortable together. “I don’t know what more I can do,” he said. “It’s just my personality.”

Kroger, 51, who was said to be adamantly opposed to a merger, did not appear at the press conference.

Sperry, which is now moving its headquarters to Blue Bell, Pa., will continue to be based in that city, Blumenthal said, while Burroughs’ headquarters will remain in Detroit. He said officials are still considering what name they will use for the new firm.