PHILADELPHIA — Unisys Corp. continued a nine-year quest for sustained profits Tuesday by announcing the planned sale of its defense and aerospace holdings to Loral Corp. for $862 million.
The computer company is shedding about a fourth of its operations. They employ about 8,500 people in the United States and Canada and generated $1.4 billion in revenue last year.
The sale represents Unisys' latest effort to halt a downward spiral in revenue since it was formed in the 1986 merger of Burroughs Corp. and Sperry Corp.
The Blue Bell, Pa.-based company underwent a $1.3-billion reorganization in 1993, and has slashed its worldwide work force by more than half since 1989. Its debt peaked at $4 billion in 1989 and revenues dropped to $4 billion last year, compared to $10 billion four years ago.
"The sale of our defense business is the last major step in repositioning our existing portfolio of businesses," said James A. Unruh, chairman and chief executive of Unisys, in a statement.
The deal will include Unisys' military electronics systems integration, program management, software and custom product design and manufacturing businesses. Also to be sold are some non-defense product operations, including postal systems, weather systems and air traffic control systems that have been part of Unisys' defense systems business.
Among the sites being sold are systems development operations in Camarillo, Calif.; Great Neck, N.Y.; Huntsville, Ala., and Reston, Va; electronic systems sites in Eagan, Minn.; Clearwater, Fla., and Pueblo, Colo.; communications systems holdings in Salt Lake City, and Colorado Springs, Colo., and systems integration facilities in Montreal and Ottawa.
Loral, in auction-style bidding, won over Raytheon Co. and General Motors' Hughes Aircraft Corp., Bernard L. Schwartz, Loral chairman and chief executive, said in an interview.
He said he expects to see few changes in Unisys' defense work force. "It's not our style to look upon acquisitions as an opportunity to close plants and move people," he said.
"The Unisys defense operations fit extremely well with ours," Schwartz said in a statement. "Virtually each of the operations we are acquiring complements and enhances Loral's existing core technologies."
He said Loral plans to finance the cash purchase with existing lines of credit.
Although the company would not give defense revenue figures for previous years, it has previously broken down those figures in relation to what it calls custom defense systems, or goods sold to the Pentagon.
Those revenues were $1.835 billion in 1991 and dropped to $1.526 billion in 1993.