Troubled Varian Picks Outsider as Chief

Varian Associates Inc. has brought in an outsider, J. Tracy O’Rourke of Rockwell International Corp., as chairman and chief executive in hopes that he can turn around the Palo Alto electronics company’s flagging fortunes.

O’Rourke, 54, who succeeds Thomas D. Sege, was one of three executive vice presidents and chief operating officers at Rockwell.

Sege, Varian’s chief executive since 1981, has been named vice chairman. Varian’s board began a search last summer for a replacement for Sege, 63, who said he wanted to step out of the CEO’s role before reaching 65.

O’Rourke’s appointment drew cheers on Wall Street, as traders launched a buying spree that raised the price of Varian stock shortly after the announcement. It closed on the New York Stock Exchange at $23.25, up $1.50.

Although many analysts were unfamiliar with O’Rourke’s name, his track record boosted hopes that the company could begin to improve sales.

“The bottom line is the guy’s a heavyweight, very heavyweight, and I can’t be more positive on what this means for Varian going forward,” said Stephen J. Balong, financial analyst at Shearson Lehman Hutton in New York.