Computer Memories, which has been trying to go out of business for some 18 months, is finding itself the object of a takeover fight.
The nearly liquidated Chatsworth concern last month agreed to be absorbed by DIC, a Burbank company that is the nation's largest television cartoon factory.
But an investment group led by Paul and Natalie Koether of Far Hills, N.J., disclosed Wednesday that it wants to gain control of Computer Memories to block the merger with DIC so it can find a more attractive deal for shareholders.
The Koether group, operating through a firm called Sun Equities, told the Securities and Exchange Commission that it owns 9.7% of Computer Memories. It also has arranged to pay $3.4 million for 1.7 million shares held by Intel Corp., Computer Memories' largest stockholder, a move that would raise the group's stake to about 25%.
FOR THE RECORD
Los Angeles Times Friday January 22, 1988 Home Edition Business Part 4 Page 2 Column 4 Financial Desk 2 inches; 38 words Type of Material: Correction
A headline in Thursday's business section inaccurately suggested that Sun Equities is suing to thwart a proposed merger between DIC and Computer Memories. In fact, Sun Equities is trying to block the merger by gaining control of Computer Memories through stock purchases.
Computer Memories' main attraction is the nearly $25 million in cash on its balance sheet. The money, which Computer Memories accumulated by liquidating its assets, is virtually the only thing the company has.
Merging with Computer Memories also would give DIC, which produces such cartoons as "The Real Ghostbusters" and "Alf," a relatively easy way to go public. Computer Memories already is a publicly held concern, and DIC could gain that status by acquiring the company.
In an interview, Paul Koether said he and other Computer Memories shareholders would get a better deal through a merger with a company in an industry such as financial services or defense.
Koether said DIC is likely to be hurt by a glut of animation on television and added that many entertainment companies are slumping. He added that DIC may be burdened with debt as a result of a $65-million buyout of the company led by DIC management in 1986.
In addition, Koether said many companies may be interested in acquiring Computer Memories as a way to go public. He explained that the alternative way of going public, having a public stock offering, has become less attractive because of October's stock market crash.
Mel Woods, DIC's chief financial officer, disputed Koether's analysis. He said the financially troubled entertainment firms are largely film companies such as Cannon Group and De Laurentiis Entertainment.