Wang Laboratories Acts to Acquire Stake in Digitext

Wang Laboratories would acquire a stake in Thousand Oaks-based Digitext and become the exclusive distributor for the company’s products under a preliminary agreement announced on Monday.

Under the agreement, Wang would receive warrants enabling it to purchase up to 1.2 million shares of Digitext stock. The companies, which said they expect to complete their agreement by Oct. 31, declined to disclose further financial details.

Digitext makes systems for entering text into computers by a shorthand method. Paul G. Henning, a spokesman at Wang’s Lowell, Mass., headquarters, said the computer company has long sold its text-entry systems to law firms, and that Digitext’s equipment will fit in well with that line of products.

Digitext’s largest shareholder now is Service Resources of New York. It has a stake of 1.2 million shares, or 32% of Digitext’s outstanding stock. If Wang exercises its warrants, however, both it and Service Resources will have stakes of 24.1%.

Digitext’s stock has risen dramatically since Aug. 28, the day before the company disclosed that it was negotiating with an equipment distributor that it now says was Wang. Digitext’s stock closed Monday at $12, up from $3.875 on Aug. 28.

The Aug. 29 announcement was made hours after the National Assn. of Securities Dealers, a regulatory organization, asked the company about the stock run-up that began earlier in the day. No other inquiries have been made by regulators, according to John Long, Digitext’s executive vice president for operations.