Ownership of Wang Laboratories Inc will pass to the most prominent classes of creditors under the company’s reorganisation plan filed yesterady. The reorganised Wang’s common shares will be issued to general unsecured creditors, including debenture holders, while the holders of its current class B and C common will be issued with seven-year warrants to buy back 20% of the reorganised company’s common shares. The exercise price for the warrants will enable creditors issued with common to recover 95% of their claims before the exercise price equals the trading price. The company says it believes the reorganisation plan will lead the company out of Chapter 11 protection and to profitability in fiscal 1994 to June 30 that year. Creditors holding priority claims, such as pre-petition wage claims, some customer claims, set-off claims and secured claims will be paid in full or as agreed upon by the parties, or otherwise remain outstanding; it appears that the shares now traded on the American Stock Exchange will be essentially worthless. The new Wang will not invest in development, design and manufacture of open systems hardware so that capital investment, inventory and warehousing requirements will be substantially reduced. It will continue to assemble and test VS computers and secure systems products. The two strategic businesses – integrated imaging and office software, and value-added network services – will be managed through five business units – North America, Federal Systems, Euorpe, Asia and Latin America South Pacific. It sees fiscal 1994 turnover of $1,000m, compared with $1,300m this year; 3,300 more jobs will have to go over time.
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