Practical Peripherals Parent Says Merger Talks Over

The parent company of Practical Peripherals, a Thousand Oaks modem maker, has announced the end of merger talks aimed at helping the parent, Hayes Microcomputer Products Inc., emerge from U.S. Bankruptcy Court proceedings.

Hayes, based in Atlanta, said that its potential merger partner, Boca Research Inc. of Boca Raton, Fla., bowed out after Hayes balked at changing merger terms that had already received court approval.

Dennis C. Hayes, chairman and president, said that he’s talking to other potential investors and is even willing to resume negotiations with Boca. He did not disclose what changes Boca had sought in the merger plan.

The proposed changes caused him concern that Boca “might try to back Hayes into a ‘take-it-or-leave-it’ scenario,” Hayes said.

“I remain confident that Hayes will secure the financing necessary to emerge from Chapter 11, pay all valid creditors’ claims in full--plus interest--and continue on our strong growth pattern over the next several years.

“What Boca found extremely valuable in Hayes--namely our global brand recognition and top-of-the-line technology, products and services--are still valuable.”

Hayes Microcomputer, like Practical, is a leading producer of modems, which allow information to be sent from one computer to another over telephone lines.

As for his company’s prospects, Hayes said sales and bookings are at record levels “despite the challenges of operating the business under Chapter 11.”

Hayes Microcomputer, a privately held producer of modems and other computer equipment, has been under bankruptcy court protection from creditors since Nov. 15.

Just before entering bankruptcy, Hayes formally merged with Practical, which until then was a wholly owned subsidiary that operated independently. The consolidation brought both companies under the court’s protection.

At the time of the merger, sources at Practical said more than 100 employees were laid off at the Ventura County facility.

While not predicting when his company will emerge from bankruptcy, Dennis Hayes said the company has had operating profits in each of the three quarters since the bankruptcy filing.

“Full and complete credit for the successful turnaround of the company goes to the employees of Hayes,” he said. “They have performed beyond all expectations under the circumstances.”