The San Francisco Examiner from San Francisco, California • 33

72- .1 San ifamcfero Examiner 9 mm am ByPauJFreiberger Of TH EKAtWCR 8TAFF compatible computer peripherals, including storage devices and communications terminals. In addition, the newly formed company will acquire the Memorex computer media products business and the manufacturing of Burroughs-compatible storage devices. The remaining parts of the original Memorex Corp. are to be retained by Burroughs. The sales price of the various divisions totals $550 million, according to Burroughs.

The transaction would largely be in cash, but with a portion transferred in the form of preferred stock. The company said it doesn't anticipate any immediate loss of Jobs by Memorex Corp. workers In either of the company's Bay Area facilities in Santa Clara or Milpl-tas. Peter Hynes, spokesman for Burroughs, said that the Memorex subsidiary employs 9,000 workers. He said the new company is expected to bring in revenue of about $900 million annually and employ 6,000 employees.

Tom Lustenader, spokesman for Memorex, said the only impact on Jobs could be in "corporate activities." "It'll be a minimal Impact if there is any reduction," he said, adding that Memorex "corporate activities" include approxi mately 300 to 350 Jobs. The new Memorex will be headquartered in Ixmdon, with its S. facilities in Santa Clara, Lustenader said. Michael Chuba, an analyst with the Gartner Group, a market research firm in Stamford, said a sale or spinoff of Memorex had been rumored ever since Burroughs completed the acquisition of Slurry Corp. in September.

"1 think Burroughs is keeping what it feels is key," Chuba said. "They would prefer to emphasize their customer base and it is difficult to divert attention to the IBM world. With the acquistion of Sperry, they'll have their hands full as it is." Chuba added that the IBM-compatible market retained by Memorex is tough because of competition from several other U.S. and Japanese companies. He said that Memorex ranks No.

5 in U.S. firms that sell IBM mainframe disk-drives. The four leaders are IBM, Storage Tech nology National Advanced Systems and Amdahl Chuba said. The company trails in the market because Memorex entered "late in the game" and its drives have had "reliability prob-, lems," he said. "Hopefully they've put all the problems behind them." Burroughs Corp.

announced Thursday that will spin off a $550 million slice, of Its Santa Clara-based Memorex Corp. subsidiary, resulting in the creation of a new corporation that will keep the Memorex name but only part of its business. Under the agreement, which still must be financed, Burroughs is to sell to New York investor Eli S. Jacobs and a group of Memorex executives the parts of its subsidiary that manufacture, sell and service International Business Machines Corp. plug- mm Japanese buy 50 of Crocker Center Sale price estimated at $135 million 7A Y7 1 III Jf LJ.

1 i 'Siifc, )kxiMzi a A. it J7 i dFEx rXr3S ff ii elzzo ivllli izzz cf 7.40 jSOMK LATE buying dulled (he stock market's sharp earlier losses Thursday, but prices still finished lower. A sagging bond market, weakness in the stock of International Business Machines, and investors' apparent willingness to take profits at any sign of trouble were among the reasons cited for the decline. -The Dow Jones industrial average fell 7.45 to 1,891.59. It' was down more than 24 points in early trading and was down more than 16 points entering the final 30 minutes.

Standard Poor's 500-stock index slipped 0.71 to 245.86. Declining stocks led advancers by about 3 to 2, Volume easod to 166.60 million shares from 183.17 million Tuesday. IBM dropped 1 to 121 Vi as Goldman, Sachs Co. removed the slock from its recommended list. Ccr lscr.3 tend consumer Czb cosring DU.S.

CONSUMERS took on sharply higher debts in September as outstanding consumer credit increased by $8.37 billion to a total $588.9 billion, the Federal Reserve Board said Thursday. It was the biggest rise in consumer credit in the past year and more than twice the August increase of $3.74 billion. The Fed attributed the jump mainly to new-car buyers rushing to take advantage of cut-rate financing incentives. Auto credit alone soared to $7.74 billion during September from $2.58 billion in August. DICK CLARK, known throughout the entertainment world as America's oldest teen-ager, unveiled plans Wednesday to take his entertainment By Bruce Koon EXAMINER REAL ESTATE EDITOR In a deal that indicates the strong growing Japanese interest in U.S.

real estate, a 50 percent stake in Crocker Center in San Francisco has been sold to a Japanese investment group. No price was disclosed for the sale. The deal was closed Monday, according to documents filed with the San Francisco County Recorders Office. But real estate sources said the transaction was valued at about $135 million an amount representing a lower price per square foot than was paid when the four-parcel complex was sold two years ago. The seller is Prudential Insurance Co.

of America, the nation's largest real estate developer. The buyer Is Nissei Realty the U.S. operation of Nipjwn Life Insurance Japan's largest life insurance company. Newark, Prudential bought Crocker Center in 1984 for $358 million from Crocker National Corp. The center consists of a 38-sto-ry tower that was headquarters for Crocker National Bank, which Tin I.

irm EuminwKity Rtddalt The salt of Crocktr Cantar It an axampla of tha Increasing Japanasa Interest In U.S. properties merged with Wells Fargo It Co. last May; a three-level shopping a 22-story office building, and Crocker Bank's historic One Montgomery Street of ice. San Francisco real estate bro kers and developers said the sale price was lower than what Prudential paid in 1984 partly because the off ice market is softer. "Prudential paid top dollar, and the value of the property hasn't Increased," said one broker.

A real estate source also noted that when Prudential bought Crocker Center, it might have been counting on Crocker expanding. At -See CROCKER C-4 mi ili.ijjuij it GM to close 1 1 plants; 29,000 workers idled company public. Clark, 56, host of TV's popular "American Bandstand" since the 1950s, said in a Securities and Exchange Commission filing he plans an offering of 1.8 million shares of common stock in his Dick Clark Productions Inc. The offering is expected to raise about $14.5 million, which the company said will enable it to increase its production of television shows and to broaden the type of programs it produces. Edelman buys more Lucky stock' By Laurie Itow OF THC EXAMINER STAFF By Jan A.

Zverina UNITED PRESS MTERNATKMM. Clark Thursday to be discussing a possible "auction" of Its three specialty retail chains to raise cash and buy back stock. Lucky already is in the process of selling its 80-store Gemco discount chain for more than $700 million. The estimated 820 stores in its three specialty operations include 380 Kragen and Checker auto parts stores; 340 fabric stores ojerating under the names of Hancock, Minnesota Fabrics and Fabric Warehouse; and about 100 Yellow Front general stores. A sale of the stores would leave Lucky with its 575 supermarkets, most of which are located In California.

Edelman has said that if he acquired Lucky, he would sell off individual operations to make a profit. week, Edelman withdrew a $1.9 billion l-ucky takeover bid, or $37 a share, after the Ixicky board rejected it as too low and said it planned to restructure the company. At the time, Edelman said he might resume his buyout overtures after lAicky Is reorganized. lAicky earlier announced a plan to buy back 22 percent of Its stock at $40 a share, a price considerably higher than the closing price Thursday of $34.50 a share. But a source said that I-ucky has since decided to buy back as much as 40 percent of its stock.

-See LUCKY. C-6 other plants. Many union officials have said the plant closings are a way for the nation's largest automaker to put pressure on the United Auto Workers union before negotiations on a new labor contract begin next year. GM's agreement with the UAW expires next September. The operations to be closed are: Fleetwood-Clark' plant in Detroit: 6,600 employees, to be closed by the end of 1987.

Flint Body-Pontiac Assembly plants in Flint and Pontiac, 4,500 employees, to be closed by the end of 1987. Chevrolet Pontlac-Canada plant In Norwood, Ohio: 4,000 employees, to be closed by mid-1988. GM Truck Gus Group's light truck assembly plant at St. Louis: 2,200 employees, to be closed in mid-1967 with production of crew cab and cab-chassis models to be transferred to Janesville, Wis. Metal stamping plants at Willow Springs, 2,900 employees; Hamilton, Ohio: 2,500 employees; Detroit, 700 employees.

GM also announced shutdown of partial production operations at two GM Truck I Bus Group plants in Pontiac and Flint. Pecifie Dell csn try computer lln! THE CALIFORNIA Public Utilities Commission has given Pacific Bell permission to test a commercial version of a service that will permit low-cost computer-to-computcr communications for businesses and Based on "packet switching" technology that breaks up information sent over phone lines into individual "packets" that can be directed to different locations, the service is currently being offered commercially by Tymnet, Telenet and American Telephone Telegraph. clips; ct zz hlchcr BTIIE DOLLAR fell against most key currencies, ex ept the yen, in European trading Thursday. Gold rose. In Tokyo, the dollar rose to a closing 163.45 Japanese yen from 163.00 yen at Wednesday's close.

Later, in London, it was quoted at 16133 yen. The dollar fell against the pound, for the fifth straight trading day, to $1.4335 from $1.4210 late Wednesday. I)ndon gold bid was $408.50, up from $406 late Wednesday. Zurich bid was $406.00 vs. $406.50.

Late silver bid at. London: $5.65 vs. $5.68 late Wednesday. Compiled from stiff $nd wire reports DETROIT General Motors Corp. announced Thursday that it will close 11 operations in four states by the end of the decade in a move that will idle about 29,000 workers.

Closing the plants in Michigan, Ohio, Missouri and Illinois will result in an annual savings of $500 million, GM Chairman Roger Smith said at a news conference. When asked whether any of the plant closings were still negotiable, Smith said, "We're past that." GM President F. James McDonald also indicated there might be further plant closings. "I would not say this is the end of plant closings," he said, declining to elaborate. GM showed a third-quarter operating loss of $338.5 million in the domestic automotive industry, which sliced into the company's overall quarterly profit.

The giant automaker said it also plans to cut its salaried work force by at least 25 percent by the end of the decade. Not all of the hourly workers at the plants to be closed will be laid off many have transfer rights to New York investor Ashcr B. Edelman, who has threatened to take over Lucky Stores Increased his stake Wednesday in the Dublin-based retailer, a source said. Kdclman would not comment Thursday on the stock buy. But stock traders speculated that the move is an effort to pressure the company's board of directors, which was meeting Thursday to discuss restructuring the company.

Fxielman wants the board to sell the company to him or take other measures, such as a leveraged buyout, to boost the stock price and allow Kdclman and other shareholders to make a profit, a source has said. Edelman'i block acquired Wednesday aparentiy puts his total holdings Just short of a 5 percent stake in Lucky, which has about 52 million shares outstanding. Under federal law, Edelman would have to publicly disclose his holdings and his intentions if he accumulated a stake of 5 percent. The Lucky board was rumored 7 SID Deadline extended for ballet bond issue Taxing decision: Deferring income The Mth part of The Examiner's series on the new tax laws explains the advantages of deferring business and investment income. Paga C-2 local press, as well as in the New York Times, Fortune, Newsweek, and on the television program Entertainment Tonight Bonds customarily are issued by corporations or government entities as long-term lOUs that accrue interest and can be traded on the open market The ballet's bond carries 5 percent interest over its 10-year life well below the rate offered by VS.

government bonds but those ho invest in a minimum $1 ,000 unit also receive two $30 orchestra seats to Nutcracker performances annually for the next 10 years. Despite the bonds' slow sales, Inc Nutcracker production Knot in danger of cancellation, said George James, a lvi Strauss 4 Co. vice preU- Set BALLET, C-7 lion by the end of last week by selling the bonds to individual investors. But only about $300,000 worth had been sold as of Wednesday, according to Dennis Wu, a San Francisco accountant who helped develop the offering. Wu said the association must raise at least $500,000 by Dec 1 or the offering will be withdrawn.

Representatives of the San Francisco Ballet Association, including a contingent of local lawyers, accountants and investment bankers. Mid at a press conference in early September that the bond sale was a first for a private arts organization. They hoped it would serve as a model financing vehicle for other non profit groups. The offering was the subject of stories in the ByPaulF.rhi OF (KAMVCft STAfF A unique bond issue designed to finance the San Francisco Ballet's production of The Nutcracker has failed to meet sales expectations, forcing ballet officials to extend the offering deadline Ine organization may be forced to cancel the widely publicized offering if the tepid response continues through the new deadline, Dec. 1.

The ballet had hoped to rake up to $15 mil Goodyeer cete of Sir James Goldsmith's group made a friendly offer to acquire Goodyear Tirat Rubber. PagtC-5 McDonsld'i moves esst McDonald's says it will expand into Eastern Europe with restaurants in Yugoslavia and Hungary. Pagt 04 i i i 4 A ,1 A A A .1 A a A A A A A A A A A A A A a A A AAA A A.