Unisys Corp accompanied announcement of its $639.3m net loss for 1989 on turnover up 2% at $10,100m with the news that chairman and creator of the company in its present form Michael Blumenthal is off to become a limited partner at investment bankers Lazard Freres & Co in April; he will retain the title of chairman but will be succeeded as chief executive by president James Unruh. Blumenthal, who became chief executive of Burroughs Corp in 1980, was responsible for buying Memorex Corp and selling it again, and for acquiring Sperry in 1986 to create Unisys, and quickly adopting Sperry’s emerging strategy of offering a broad line of Unix machines for the whole company: under Blumenthal, Burroughs had been, after IBM, the least enthusiastic of the majors about Unix. He subsequently acquired Convergent Inc, and for the first couple of years, the momentum behind the combined business gave the impression that the merger was a success and Blumenthal declared as his aim to make Unisys a $20,000m-a-year company by the early 1990s. Since then it has been stuck on $10,000m while the nimbler DEC and Hewlett-Packard (including non-computer interests) have sailed past it. Blumenthal leaves Unisys with an enormous $4,000m burden of debt, 50% of the group’s capital, requiring a daunting $100m a quarter to service. So further asset sales are now required, and defence businesses are such a drug on the market that that side is to be kept. Unisys is now looking at some of the vertical systems houses acquired by Convergent as sale candidates to cut debt by $600m to $800m. Inventories were cut $723m in 1989, exceeding the $500m target.
