Lockheed Halts Planned Sale of CalComp

Six months after putting its CalComp subsidiary up for sale, Lockheed Corp. said Monday that it has changed its mind and will keep the Anaheim computer graphics company.

Lockheed received several offers for CalComp but rejected them as too low, company Chairman Daniel M. Tellep said in a prepared statement. He said the profits generated by CalComp are worth more to the Calabasas-based aerospace firm than the money it would have received in a sale.

“It’s wonderful to feel wanted,” CalComp Chairman William Conlin said in an interview.

“The general feeling among management and employees is one of relief,” he added. “At least it’s over now, and we won’t be sold to a venture capital type” who might sell off CalComp in pieces.

When Lockheed announced plans last April to sell the Anaheim unit as part of a sweeping corporate reorganization, Conlin and a group of CalComp managers said they would try to arrange financing to buy the company themselves. But the group was unable to raise enough money and never made a formal offer to Lockheed, Conlin said.

While declining to name the bidders, Lockheed’s Tellep said the offers for CalComp “did not represent a fair market value of the firm.” He added that the offers “may have been affected by a general softness in the (computer) peripheral market” in 1989.

Conlin said CalComp, which makes plotters used in computer graphics applications, is being adversely affected by sluggish sales in the computer market.

“Whether you can buy a property or company is a function of the current circumstances,” he said. “Right now, with the disarray in the financial markets and the performance of the computer industry in general, it is probably the worst possible year to get a good value for a company.”

Although CalComp’s sales are expected to rise from $425 million in 1988 to between $450 million and $475 million this year, earnings will be down, Conlin said.

“It’s been a disappointing year,” Conlin said. “But we will be solidly profitable.”

Lockheed’s Tellep met with CalComp’s senior managers in Anaheim Monday to discuss the company’s decision to retain CalComp, Conlin said. One change announced by Tellep is that Conlin will now report directly to Tellep rather than the head of Lockheed’s Information Systems Group.

“That’s an improvement, and we’re pleased with that,” Conlin said. “Lockheed has treated us real well and we have felt like we’re a good asset to them.”