J H Whitney Co, as reported briefly (CI No 1,390), hopes to take its profit on its leveraged buyout of Prime Computer Inc by floating the Computervision CAD/CAM arm – which takes in all Prime’s pre-existing CAD/CAM offerings and the subsequent Calma acquisition from General Electric Co – in three to five years but the strategy depends on everything going to plan, which in the unpredictable world of high technology is a big gamble. Computervision division president Robert Fischer reckons that the bolstered company is now worth close to twice the $433m Prime paid for it. The Whitney strategy, put simply, is to service the debt with revenues from Prime’s maintenance business, repay the debt with cash flow from the minicomputer business, and take its profit on flotation of Computervision but the weak link is of course the second, the computer business, which is late in making the transition to Unix from its proprietary PrimOS operating system. Fischer told a recent meeting of CAD/CAM executives in Cambridge, Massachusetts that Computervision grew 10% last year and looks to grow 13% this year.
