NEC Corp and Compagnie des Machines Bull SA are riding to the rescue of cash-strapped Packard Bell Electronics Inc, the Sacramento, California personal computer maker universally believed to have received a large inventory-backed loan from Intel Corp. Under a comprehensive restructuring, Packard Bell will be merged with Bull’s struggling Zenith Data Systems, and the married company will get a dowry of more than $650m from NEC and Bull. NEC will invest $283m in cash for non-voting convertible preferred stock and will retain 19.99% of the voting equity. The balance is in kind, being the book value of Zenith. As part of the deal, Bull will receive medium term notes and convertible bonds from Packard Bell to an unspecified value. The funds are intended to give Packard Bell the means to develop its range of multimedia computers for the US market, strengthen its position in the international market and expand its distribution channels. With the addition of Zenith’s activities, Packard Bell will have annual turnover of more than $5,500m, based on the 1995 sales of both companies, and with 13% of the US market, will vie with Compaq Computer Corp for top spot. When NEC’s personal computer sales are added in, the grouping becomes number one worldwide. The enlarged Packard Bell plans to list its shares in the US this year, NEC said, adding that it and Packard Bell would consider the sharing of personal computer plants and co-operation in support services and distribution of products.
