4 of Cipher Data Products’ Top Executives Resign

Four top executives, chairman Gary Liebl among them, have resigned from Cipher Data Products, the San Diego computer tape drive manufacturer that Archive Corp. of Costa Mesa acquired earlier this month in a $123-million tender offer.

Archive officials Wednesday confirmed the resignations of Liebl, chief financial officer Thomas Anderson, general counsel Henry Kohlmann and vice president of human resources Richard Ottaviano.

Archive said it will make the $2.7 million in “golden parachute” severance payments that the Cipher Data board of directors voted for Liebl and eight other executives before the tender offer was made.

Archive’s $8.25-per-share tender offer for Cipher Data was completed April 5, and the two companies formally merged on Tuesday, Archive general counsel Tag Merrick said Wednesday. The merger resolved an on-again, off-again takeover battle that began in December, when Archive’s board made an unsolicited $7.50-per-share tender offer for Cipher Data.

Both companies manufacture tape drives. These are a computer data storage device used as a backup for hard disks. The merged company will control more than 40% of certain segments of the tape drive market.

The Cipher Data board had previously agreed to the resignations when it accepted the terms of Archive’s tender offer, Merrick said.

Industry observers expect layoffs at Cipher Data as a result of the merger. Merrick said Archive has yet to decide whether it will cut jobs.

“We’re still taking a look at the two structures to determine how we are going to proceed, to see if we are going to do any consolidation of the two groups” of employees, Merrick said.

He said Archive has about 1,600 employees and Cipher Data about 1,700.

Archive reported revenue of $181 million for the fiscal year ended last September. Cipher Data reported revenue of $218 million for its fiscal year ended last June.