Packard Bell Will Relocate Units to Utah : Chatsworth: Computer maker’s decision involves service and support divisions and means the loss of hundreds of jobs.
Packard Bell, the Chatsworth-based computer manufacturer whose efforts to relocate have become the focus of a drive to retain jobs in California, said Monday it would move almost one-quarter of its jobs to Utah.
Service and support units, which include about 420 of the firm’s 1,500 employees, will move to a facility outside Salt Lake City, the company announced.
“Most of these employees are being offered the opportunity to relocate to Utah,” according to a written statement put out by the company. About 50 of the support employees will remain temporarily at the Chatsworth office until the remainder of the company relocates.
The company, among the largest personal computer manufacturers in the United States, is negotiating with several communities in the western part of the country that would like to snare the company and its jobs. The leading California contender, according to company executives, is the Antelope Valley city of Palmdale.
High-level state, county and city officials have gotten involved in the campaign to keep the company--which executives say has outgrown its San Fernando Valley facility and needs to relocate to expand--in economically troubled California.
A decision on moving the remainder of Packard Bell will not come “for a few weeks, at least,” according to spokeswoman Liz O’Donnell.
Palmdale has attempted to lure the company with an offer of 50 acres of developed land, worth an estimated $7.5 million, and the proceeds from a $10-million bond issue.
Gov. Pete Wilson has gotten involved on the city’s behalf, urging the state Legislature to pass a bill designating Palmdale an enterprise zone, which would give Packard Bell a $19,000 tax credit over five years for every employee hired.
And Los Angeles County officials have offered the company $12,500 in annual property tax breaks, the maximum allowed under state law, if Palmdale wins the company.
But there has been plenty of competition, most notably from Portland, Ore., and Salt Lake City.
O’Donnell said that the decision to move the support and service units to Salt Lake City should not be read as an indication that the Utah city is now the front-runner to get the rest of Packard Bell.
“It’s a separate issue,” she said.
Packard Bell sells personal computers through 9,000 retail outlets worldwide. Company officials say it posted revenues of more than $1.25 billion in 1993 and project 84% sales growth in 1994.
As a privately owned company, Packard Bell is not required to disclose sales figures. But it is known that the company has had debt troubles.
In 1992 when it attempted to raise capital with a public stock offering, the company issued figures showing that as of 1991 it was carrying $93 million in debt. The stock offering was withdrawn due to a poor response from potential investors.
Packard Bell did get a boost last year, however, when a French computer company bought a 19.9% stake in the firm.
