Yuen Buys Big Stake in Sound Innovator : Technology: The AST Research co-founder gains controlling interest in young Newport Beach-based SRS Labs, which has a system that distributes noise in three dimensions.

Thomas C.K. Yuen, who made a fortune as one of the founders of computer maker AST Research Inc., said Monday that he has bought a majority stake in a young Orange County company striving to create the successor to stereo sound.

Yuen invested $2.71 million in SRS Labs Inc., a 7-month-old Newport Beach company. He will have a controlling interest and assume the titles of chairman and chief executive officer.

SRS purchased a novel sound technology developed by Hughes Aircraft Co., which decided last year to sell its sound retrieval system--SRS--to focus on its core aerospace business. The system distributes sound in three dimensions, taking it from standard stereo speakers and enriching it so that the listener has the impression of being immersed in it, said Stephen Sedmak, president of SRS.

Yuen, a computer marketing maverick, co-founded AST in 1981 and helped it grow to a billion-dollar company. He resigned in 1992 after a power struggle with co-founder Safi U. Qureshey.

“I’ve been looking into the multimedia area, which is in an emerging stage, and I stumbled on this company and its technology,” Yuen said in an interview Monday. “The staff gave me a demonstration. But even though I have a hearing problem, it sounded great.”

Sedmak, a part-owner, will remain as president and the top executive for day-to-day management. Yuen will act as a business adviser.

“This accelerates our ability to establish SRS as a standard,” Sedmak said. “We will use Tom’s connections in the industry and his stature to reach our goals more quickly.”

Investment banker Walter Cruttenden III will relinquish the title of chairman but remain an investor and board member, Sedmak said.

The company has seven employees, including Arnold Klayman, the inventor of SRS. Klayman, 67, spent 25 years developing sound technology at his small research company in Costa Mesa. Hughes bought the technology in 1986.

The first product was a component that adapted ordinary stereo systems so they could sport SRS sound. Since June, SRS Labs has licensed its technology to companies designing components for for personal computers and video games.

The company has also licensed the technology to a number of TV manufacturers. Through licensing, Sedmak said, he hopes to create a company with $30 million to $70 million in revenue within five years.