Ascend Hires Salomon Smith Barney to Help Sell Stratus Units
Alameda, California, Oct. 21 (Bloomberg) -- Ascend Communications Inc. and senior managers of Stratus Computer Inc., which Ascend acquired yesterday, hired Salomon Smith Barney Inc. to find buyers for three Stratus units.
Ascend, a maker of computer-networking equipment, hopes to find a buyer for Stratus's computer division that will issue stock options so employees of the unit can own a stake in the new company, said Stephen C. Kiely, president of Stratus's enterprise computer business. Salomon also will help find buyers for Stratus's S2 and TCAM software divisions.
Ascend bought Stratus to boost its line of products to help phone companies run their networks, and previously said it would sell parts of Stratus that aren't associated with its telecommunications business. Ascend has said it had buyers interested in Stratus's software units and its computer unit.
Ascend ''didn't want to be in the computer business,'' Kiely said. ''Now we have a substantial bit of our (business) plan complete and we're a lot closer to the goal line.''
Ascend rose 13/16 to 43 3/4 in midafternoon trading.
Alameda, California-based Ascend hopes to find buyers for the divisions of Stratus, which now is a wholly owned subsidiary, by the end of the year, Kiely said. Ascend will retain a 10 percent to 20 percent stake in the computer division, he said.
Last year, Stratus's computer division and related services had $300 million in revenue, and the software units posted $60 million, Kiely said.
Stratus also today began firing 250 employees, or about 10 percent of the Stratus workforce, as Ascend and Stratus consolidate operations, said Bruce Sachs, former president and chief executive of Stratus and now executive vice president and general manager of Ascend's carrier, signaling and management business. Originally, Stratus said as many as 500 employees from Stratus and Ascend would be cut.
14:49:33 10/21/1998
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