Unisys to Stop Making PCs, Take $1.1-Billion Charge

Unisys Corp. said Tuesday that it will stop making personal computers and will take a $1.1-billion charge against fourth-quarter earnings and concentrate on its lucrative corporate computer and services businesses.

Most of the charge, to be included in results due Jan. 15, will take the form of a $900-million write-off of goodwill from the merger of Burroughs and Sperry Corp. that created Unisys in 1986. Unisys has moved away from the proprietary technology that dominated the computer industry at the time of the merger.

The Blue Bell, Pa.-based company also called for early redemption of $198 million in senior notes due July 15 to meet its goal of cutting $1 billion in debt from the company’s balance sheet by 2000.

Unisys plans to stop making low-cost servers as well as PCs, but said it is negotiating with a new global partner to supply laptops and desktop computers and other hardware under the Unisys name.

“While we are committed to providing a full range of technology systems and solutions to meet customer needs, we were not generating the volume needed to compete effectively and profitably in the PC business,” said Unisys Chairman Lawrence Weinbach, who succeeded James Unruh in September.

Last October, Unisys and Windows NT software maker Microsoft Corp. formed a joint venture to offer business programs and products based on the NT operating system.

The fate of 900 people employed by the computer systems group, which makes PCs and low-end servers, remains to be negotiated. Weinbach said he hopes to announce a deal within 90 days.

Unisys stock rose 38 cents a share to close at $14.31 on the New York Stock Exchange.