Stern, in Surprise Move, Resigns as Unisys President

Unisys Corp. Chairman Michael Blumenthal, moving to cement his hold on the top spot of the nation’s No. 2 computer maker, announced Thursday the resignation of its 48-year-old president, Paul Stern.

The unexpected departure of Stern, brought into the firm four years ago by Blumenthal to head its manufacturing engineering operations, surprised analysts, who said it appeared that Stern had been forced out.

“He was reorganized out,” said Stephen Dube of Shearson Lehman Bros. “It is obvious that there is no one who is to be viewed as the senior executive of the company other than Mike Blumenthal.”

Blumenthal, who served as Secretary of the Treasury in the late 1970s, was chairman of Burroughs Corp. when he negotiated its merger with Sperry Corp. to create Unisys. Analysts said Blumenthal’s decision not to name an immediate replacement for Stern indicated that he wanted to personally oversee his strategy for Unisys now that the firm had largely unified its operations after the merger 16 months ago.

“At the top, this was a consolidation (of power) by Blumenthal,” said Wertheim and Co. analyst Barry Tarasoff.

Stern, who will step down Dec. 31, said that the completion of the merger made it “an appropriate time for me to give attention to many family and investment interests too long deferred.”

But while assuming full control over Unisys’ direction, Blumenthal had also chosen to delegate to several key executives the responsibility for day-to-day operations of the company’s marketing, international, government and defense divisions, analysts said.

In a statement, Blumenthal said the creation of the management board “will provide a simplified structure for overseeing these in-place operations at the senior management level. It will speed decision making and improve staff support to the line organizations.”