The Los Angeles Times from Los Angeles, California • 59

BUSINESS Cos Angeles Slimes Saturday, January 3, 1987 CQPart IV Factory Orders Up 4.1, Biggest Jump in 2 Years Surge in Demand for Military Equipment Paces Increase; Analysts Lay Gain to Temporary Factors Factory Orders for manufactured goods rose 4. 1 in November biiiio to $200.4 billion 01 00118 i 1885 E21 19S6ES I -200 1 195 i I 1 -iso MARSHA TRAEGER Lot Angelea Times Workers move car in preparation for June auction of part of Harrah collection. Deal One of Biggest Ever Lyon Buys 82 Cars From Famed Harrah's Collection By MARY ANN ALANTE, Times Staff Writer Orange County developer William Lyon has bought 82 cars from the famous Harrah automobile collection for $28.8 million, doubling the value of his own classic car collection, Reno-based Harrah's said Friday. Lyon's purchase, believed to be one of the largest acquisitions of its kind in history, includes a 1931 Bugatti Royale Coupe de Ville one of only six built and regarded by many classic auto experts as the most valuable car in the world. The sale is the fourth and probably the last of the Harrah collection.

Before his death in 1978, William Fisk Harrah, founder of the casino and restaurant business that bears his name, had acquired 1,800 classic autos a collection believed at one time to be the largest in the world. When Holiday Corp. bought Harrah's in 1980, the car collection was included. "The car collection wasn't self-supporting," Gene Evans, marketing director of the William F. Harrah Automobile Museum, said Friday.

The museum is situated in Sparks, just east of Reno. In three previous sales of cars from the collection, Harrah's, now a subsidiary of Memphis, Holiday, has grossed about $40 million, Evans said. The new sale to Lyon did not include another 75 cars and two antique planes a World War 1 1917 Jenny and a 1937 Aero Sport. Those vehicles are to be donated to the William F. Harrah Automobile Foundation, which will keep the cars on display in the Reno area.

Major Southland Builder Lyon, until last month, was chairman and the largest shareholder of AirCal. He and a partner sold the airline to American Airlines for $225 million in November. An intensely private man and antique car buff, Lyon, 63, is a major Southern California builder and chief executive of William Lyon Co. His present collection of 35 classic autos is valued at roughly $26 million and includes actress Dolores del Rio's 1930 Duesenberg SJ Murphy Town Car and a 1935 Model SJ Walker-LeGrande Duesenberg. Lyon could not be reached Friday but his Stocks Greet the New Year With Broad Advances Dow Industrials Climb 31.36 Points as Bond Market Gives Push to Rally From Times Wire Services NEW YORK The stock market moved broadly upward in the year's first trading session on Friday, driven mainly by computerized program trading and a bond market rally, analysts said.

The Dow Jones average of 30 industrial stocks closed at 1,927.31, up 31.36 points. Gainers outpaced losers by about seven to one, with 1,479 issues up, 154 down and 270 unchanged on the New York Stock Exchange. Big Board volume totaled 91.88 million shares, compared to 139.17 million shares on Wednesday, the last session of 1986. The market was closed on New Year's Day. David Jones, a securities analyst at Aubrey G.

Lanston said the stock market "took off on the heels of the bond market." He said the bond market, which had been down in recent days, rallied as interest rates fell and was particularly encouraged by a sharp drop in the federal funds rate, the lending rate for overnight loans between financial institutions. That rate closed at 6.5 Friday after reaching a high of 20 for seasonal reasons earlier in the week. It ended trading Wednesday at 6. Analysts said the bond market gains encouraged higher stock index futures, which led to computerized program trading that drove much of the advance. In this practice, professional traders move to profit from differences in futures indexes and their underlying "baskets" of stocks.

Bulk of Activity Hugh Johnson, an analyst at First Albany Corp. of Albany, N.Y., estimated that program trading contributed 60 to 75 of the day's activity. "We didn't notice a substantial amount of action from individuals or institutions," he said. But, he added, "there was no question there was some of that." At Piper, Jaffray Hopwood in Minneapolis, analyst Edward P. Nicoski said Friday's market was a reversal of Wednesday's performance, when tax-related selling dominated the market.

Much of the pre-New Year's slide which totaled 34.45 points in the Dow from Monday through Wednesday was blamed on selling related to changes in the tax law, which took effect at midnight Dec. 31. Taxes on capital gains taken in 1987 will be higher than those taken in 1986. Please see STOCKS, Page 8 Telstar Acquires SelecTV Satellite Service By KATHRYN HARRIS, Times Staff Writer Telstar a Los Angeles-based media company, said Friday that it has acquired SelecTV, a satellite programming service, for undisclosed terms from the controlling shareholder, Clarion a Japanese electronics concern. SelecTV, which delivers movies and special-event programs via satellite to subscribers, has about 100,000 subscribers in Los Angeles and serves about 100,000 apartments elsewhere in the nation, primarily in Sacramento, Houston and New York.

Two years ago, when SelecTV acquired its local competitor ON-TV, the two services boasted 215,000 subscribers in the Los Angeles area alone. But subscriptions to these over-the-air services have waned since late 1981, when the industry peaked at 1.5 million subscriptions nationwide. At the end of 1981, for example, SelecTV had 112,000 subscribers and ON-TV had 387,000. Decline of Industry According to an industry newsletter published by Paul Kagan and Associates of Carmel, only two other services were operating elsewhere in the nation as of last September, serving just 34,753 customers. The industry has declined largely because of the growth of cable television, which offers dozens of channels for a similar fee, one analyst said Friday.

He asked not to be identified but predicted that satellite services such as SelecTV "can exist as an alternative system." In the Please see TELSTAR, Page 2 WASHINGTON GD-Orders to U.S. factories, spurred by a surge in demand for military equipment and a rush to beat tax overhaul, climbed 4.1 in November, the biggest increase in two years, the Com-, merce Department reported Friday. The department said total new orders rose by $7.9 billion in November to stand at $200.4 billion after falling 3.5 in October. While such a big increase would normally be seen as positive for the country's beleaguered manufacturing sector, many analysts said the November gain was influenced by temporary factors that offered little evidence that manufacturers will enjoy increased demand in the new year. November's increase was led by the largest one-month rise in military orders in 12 years, a 107.9 surge that reflected heavy demand for defense aircraft.

The defense increase, which followed a 43.4 decline in October, left military orders at $10.4 billion. Without the big defense increase, orders would have gone up a much smaller 1.13 in November, and some analysts said even this gain was overstating future economic strength. Last-Minute Rush They attributed much of the advance in the civilian categories to a last-minute rush by businesses to buy and take delivery on capital equipment to qualify for higher tax benefits that expired on Jan. 1. "Even though the overall number looks impressive, when you look more closely it completely evaporates," said Michael Evans, head of a Washington consulting firm.

"It isn't telling us anything about future strength." Evans said he believed that the economy limped along at a 1.5 annual rate in the just completed October-December quarter, and he said growth in the January-March period would slump to a negative 1 as businesses and consumers cut back on spending with the advent of the new tax law. Douglas Cliggott, senior economist at the New York investment house of Merrill Lynch, said it was evident that much of the increase in the November orders could be traced to the impending tax law changes. "A lot of businesses were trying to get their equipment in place before year-end," he said. Non-defense capital spending climbed 6.4 as businesses placed rush orders to qualify for more lucrative tax treatment under the old law. Business capital spending to expand and modernize had fallen 4.6 in October.

In another report Friday, the Commerce Department said construction spending fell Allied Merger Year for Vons By MARTHA GROVES, Times Staff Writer Partying was the last thing on Roger E. Stangeland's mind New Year's Eve, although he had plenty to celebrate. The chairman and chief executive of Vons Grocery Co. instead was sleeping off the effects of days of travel and negotiations that culminated in a surprise announcement late Wednesday that the company, which went private just a year ago, would become publicly traded through a merger with a Detroit supermarket chain. "I had been armpit deep in lawyers," Stangeland said Friday in a telephone interview.

"I really hadn't been to bed since Sunday night, so I slept on New Year's Eve. No revelry." He's pleased with the agreement with Allied Supermarkets of Detroit, which marks a renewal of a combination that the companies originally announced in September then called off a month later. Complex Plan Under the complex plan announced Wednesday, Vons, which operates 190 stores in California and Nevada, will merge with Allied then sell the Detroit company's operations the Great Scott! and Family Drug retail stores and the Abner Wolf distribution company to the current management. The companies estimate the value of the deal at $700 million in cash and stock. "It's the sale of the two businesses in Detroit to a new company and the merger of Vons into the old Allied corporate shell," Stangeland explained.

"We presume we will succeed to the listing on the New York Stock Exchange under a new symbol. The management of Vons will remain intact and JFMAMJJASONO SoucKQximnDtpL for a second consecutive time in November, a 0.7 decline that left spending at a seasonally adjusted annual rate of $377 billion. Analysts said construction spending will weaken further in coming months as a result of widespread overbuilding of apartments and office buildings and the removal of many tax benefits under the new tax law. Durable Goods Report The report on factory orders said two-thirds of the increase in orders occurred in the durable goods sector, which rose by 5.5 in November. In an advance report 10 days ago, the government had put the increase in durable goods, items expected to last three or more years, at a slightly higher 5.9.

Within the major industry categories, orders for transportation equipment rose 15.9, powered by an 85.3 increase in orders in the aircraft and missiles category. Without the big increase in defense orders, demand in the transportation category would have fallen 6.3. Machinery orders were up 12.2, led by a 16.2 rise in orders for office equipment. Orders for non-durable goods rose 2.5 to $91.15 billion after having fallen 1.9 in October. Shipments of manufactured goods rose 1 to $198.2 billion, with two-thirds of the $2-billion rise attributed to a pickup in shipments of defense goods.

Caps a Busy Management remain here without changes in title or responsibility." The deal capped an eventful year for Vons, an El Monte-based company that started the year off with a bang by completing a management-led buyout worth about $750 million and converting the company to private ownership. During the year, Vons, which since 1969 had been a subsidiary of Household International, then sold three other non-food units that had been purchased with the grocery store operation, using some of the nearly $500 million in proceeds to pay off part of the massive debt incurred in the buyout. Other Acquisitions It also acquired Pantry Stores, an upscale chain of 10 small, service -oriented groceries; opened several Pavilion stores, food and drug stores, and announced plans for the first major Southland chain of stores geared to Latino customers. The first of those stores, called Tianguis, is scheduled to open in a week and a half in Montebello. "That's not bad corn-pickin' for a year," said Stangeland, an Illinois native.

Stangeland said Vons set about months ago to devise a recapitalization plan that "had the right balance" of debt and, in fact, considered a public offering but decided that market conditions were unfavorable. "So we thought it would be nice to find an existing public company that had a balance sheet that fit our needs," he said. "We were looking for a company with a lot of cash and not a lot of debt." Allied appeared to fill the bill, but its management insisted on several points that Please see VONS, Page 2 accountant, Stan Ross of Kenneth Leven-thal Co. of Los Angeles, said he suspects that Lyon will display the cars. If Lyon does publicly display the cars in California, it will be a departure from his previous way of operating.

While some of his cars have occasionally been displayed at auto shows, he typically has been reticent about revealing the scope of his collection. Lyon is an unusual collector of vintage cars because he regularly drives the vehicles. "My attitude is that these cars originally were made to be driven, so I put them to their intended purpose," he said in an interview last fall. "If I couldn't drive a car, I wouldn't want it." Special Clause in Deal Part of the condition of the sale, which was completed Dec. 31, was that the buyer would permit five of the rarest cars to continue to be displayed in the Reno area some of the time for the next seven years.

"It's to appease the natives," Evans said, explaining that Harrah's plans to dispose of the vehicles have been a source of public irritation and outcry in Reno for the past several years. The five cars: 1931 Bugatti Royale Coupe de Ville, which Harrah's reportedly valued at a minimum of $12 million. 1929 Duesenberg Dual-Cowl Phaeton that was used in the motion picture "Annie." A rare 1929 Mercedes-Benz Drop Head Coupe. 1929 Miller Indianapolis race car that became a prototype for later models. 1933 Duesenberg Boattail Speedster that has only 1,750 miles on its odometer.

However, it is likely that Infocorp will soon begin expanding its data collection services to more fully complement the areas in which Gartner Group does strategic planning and qualitative consulting. Gartner Group, founded in 1979 by Gartner, also does market research, but with less focus on collecting and analyzing raw numbers than Infocorp. It became a publicly traded company last July after first spinning off its securities brokerage unit, Gartner Securities. Infocorp, founded in 1982 by Matlack, Bushee, Gilman and William Frank, has specialized in collecting and disseminating market information about small computer systems. In that segment of the industry, it is as highly regarded as its heftier competitor, Dataquest.

Dataquest, a subsidiary of A. C. Nielsen is considered the leader in high-tech market research, although neither it, Infocorp nor their other main competitor, Framingham, International Data reveals revenue figures. (Gartner and Infocorp combined are expected to have annual sales in excess of $25 million. Gartner said: "It's reasonable to assume that we are looking at competing more directly with Dataquest." Gartner Buys Infocorp, Boosts Position in High-Tech Data Field By DONNA K.

H. WALTERS, Times Staff Writer Infocorp, a high-technology market research firm based in Cupertino, has been purchased by Gartner Group of Stamford, Conn. The combination, which gives the highly regarded Gartner firm greater access to the West Coast's wide base of information -industry companies, most likely spells intensified competition in the high-tech market research and consulting business. Terms of the deal were not disclosed, but the companies said the acquisition included a fixed cash payment and additional cash payments in the future that will be determined primarily based on Infocorp's earnings. Gideon I.

Gartner, president and chief executive of Gartner Group, said the deal offers "major incentives" for the founders of Infocorp, including Richard Matlack, Skip Bushee and Ralph Gilman, to remain at that company. Gartner said that there are no plans to make immediate changes in the operations at Infocorp. "For the next three years, we plan to keep them the way they were," he said. After that, he added, may be all sorts of synergies" that could be developed between the two firms. New York Exchange page 4 American Exchange 3 OTC Markets 6 Bonds 8 Commodities 3 Mutual Funds 2 Options 5 Murdoch Rival Backed in Takeover Directors of Herald Weekly Times Australia's largest media concern, urged stockholders to accept a sweetened takeover bid from Robert Holmes a Court Please see Page 2 Friday, Jan.

2, 1987 nn nn nn nn ncn i i i i i xi i i vj is i DOW 30 NYSE AMEX NASDAQ WILSHIRE 31.36 2.43 4.22 4.43 39.855 1.927.31 141.01 267.49 353.26 2,474.804 DeBartolo Gets Allied Stores Option Real estate developer Edward J. DeBartolo Corp. confirmed that it has acquired an option to acquire through Campeau Corp. a 35 interest in Allied Stores Corp. Please see Page 2.