Computer Firm Spending $148 Million to Reassemble Company : MAI Basic Four to Buy Back 2 of Its Former Divisions
Attempting to reassemble a company dismantled three years ago during an unfriendly takeover, MAI Basic Four Inc. said Friday that it will acquire two of its former operations for $148 million.
The Tustin-based manufacturer of business computers will buy MAI Canada Ltd. and the MAI Basic Four computer maintenance business of Sorbus Inc. from Bell Atlantic of Philadelphia. The all-cash deal should be completed in early January, MAI Basic Four officials said.
“We now have the ability worldwide to sell, install and support our customers,” said Bob Garbutt, vice president for North American sales and service.
MAI Basic Four was founded in 1970 as Basic Four Corp., a wholly owned subsidiary of Management Assistance Inc. Its first product, introduced in 1971, was the first interactive business computer.
The 1980s were rocky for Basic Four, which had grown rapidly during the previous decade, according to industry experts. In 1984, parent company Management Assistance was the focus of an unfriendly takeover by Asher Edelman.
Edelman immediately sold Basic Four and Sorbus--both divisions of Management Assistance. Sorbus went to Bell Atlantic, and Basic Four went to Lebow Industries. Lebow then sold Basic Four’s Canadian subsidiary to Bell Atlantic for $23 million in cash and brought in a new president, William Patton, to run the company.
One former MAI manager, who requested that his name not be used, said Friday that Lebow sold the subsidiary to raise cash to operate and improve the part of the business that he retained. He also said that Sorbus was considered to be the premiere computer service company at the time of its sale.
Sorbus and MAI Canada are now, in effect, coming home, and will give MAI Basic Four the ability to service the computers it now sells in the United States.
“We’re reassembling MAI Basic Four,” Garbutt said. “We’ve been a player for 15 years now, and we’ve made a lot of progress in the last three years as a company. The one element missing to make us a more important player was maintenance in the United States.”
Buying Sorbus gives the company the ability to service its own computers in the United States. Buying MAI Canada will allow the company to distribute and service its products in Canada.
“This gives us the ability to provide a total solution to our customers: hardware, applications, software and the maintenance,” Garbutt said. “We will be in a better position to fulfill all of our customers’ needs as a result of the acquisitions.”
MAI Basic Four manufactures, markets and services business computers, primarily for use by small- and medium-sized businesses. It has more than 3,200 employees and more than 40,000 customers in nearly 40 countries. Its stock closed at $11.50 Friday, up $1.75 per share on the New York Stock Exchange.
Times staff writer David Olmos contributed to this story.
