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BULL AND PACKARD BELL ANNOUNCE STRATEGIC ALLIANCE

 PARIS, June 22 /PRNewswire/ -- Bull and Packard Bell today announced an agreement in principle to form an alliance between Packard Bell and Zenith Data Systems (ZDS), Bull's microcomputer subsidiary.
 Key terms of the agreement include:
 -- ZDS and Packard Bell will jointly design and manufacture desktop personal computers (PCs), simultaneously leveraging both companies' engineering expertise and the high-quality, high- volume, cost-efficient production experience of Packard Bell.
 -- ZDS will supply Packard Bell with private-label versions of ZDS' popular notebook and subnotebook PCs. This will expand the product offering of Packard Bell in notebook PCs, the fastest-growing segment of the market, while extending ZDS' leadership position and growth potential in this category.
 -- To demonstrate the long-term nature of the accord, Bull is taking a 19.9 percent interest in Packard Bell and will be represented on Packard Bell's board of directors.
 Additional terms are not being disclosed, executives said. Bull's primary shareholder, the State of France, has approved the transaction, which also has been presented to the board of Compagnie des Machines Bull. The alliance also is subject to normal U.S. regulatory approvals, which the companies expect soon.
 Bernard Pache, Bull's chairman and CEO, said, "This alliance is an important step for Bull's redeployment plan and profitability."
 The ZDS/Packard Bell alliance enables ZDS to leverage its core technology competencies, increase its PC sales volumes, and reduce its costs, according to Pache.
 The agreement, he said, is fully consistent with Bull's mission as a technologies integrator to provide customers with the best available products and services from around the world.
 "This alliance reinforces Bull's commitment to addressing the PC market, as well as the overall importance of PCs as a major entry point for Bull's highly regarded Distributed Computing Model(SEE NOTE)," Pache said.
 Packard Bell, the acknowledged world leader in personal computers sold through mass-merchant channels and the third- largest PC manufacturer in the United States, has earned a reputation for quality and cost-effective manufacturing.
 Beny Alagem, Packard Bell's president and CEO, said, "This accord maximizes our individual corporate strengths and will allow both companies to bring even more advanced and competitive products to market -- in terms of price, performance, features and support."
 Both companies will remain independent and be free to pursue all channels of distribution as aggressively as possible, the executives said.
 Jacques Noels, ZDS president and CEO, said, "Rarely does an alliance make so much sense. Both ZDS and Packard Bell will be able to focus on their existing strengths to mutual advantage, while retaining their independence."
 DESKTOP PCS
 ZDS and Packard Bell will jointly design and manufacture desktop PCs.
 "The combination of our R&D resources with Packard Bell's ability to manufacture quality, cost-effective desktop PCs will allow both companies to improve operations," Noels said.
 Alagem said, "Packard Bell has always had a focus on a lean, cost-efficient manufacturing process. As a consequence, the industry has had to cut margins and to change fundamentally the way it does business, to be competitive with us."
 The companies intend to collaborate on a full range of products, from entry-level systems on up.
 "As a founding member of the Multimedia PC Council, we are especially excited by the opportunity we have to work on this project with Packard Bell, which has already achieved strong market presence with its multimedia systems," Noels said.
 Noels said that ZDS remains committed to the complete fulfillment of the multimillion-dollar Desktop IV contract that the company holds with the U.S. Air Force.
 PORTABLE PCS
 ZDS will provide private-label versions of current and future notebook PCs to Packard Bell.
 "ZDS' technology in notebook PCs is the best in the business," Alagem said. "We're understandably enthusiastic that we will be able to offer them to our customers."
 Noels said, "We're already a market leader in notebook PCs, and Packard Bell's broad reach has the potential to substantially expand our position."
 Based in Buffalo Grove, Ill., Zenith Data Systems, a Bull company, is a leading supplier of notebook and desktop PCs, servers, monitors and related peripherals.
 Based in Chatsworth, Calif., Packard Bell is a market-driven manufacturer of a broad range of PC-compatible systems and peripherals for home offices and businesses. The company is the third-largest U.S. supplier (in unit shipments) of PC-compatible computers, according to the market watcher International Data Corporation, and occupies more shelf space in the mass-merchant channel than any other vendor.
 NOTE: The Bull Distributed Computing Model represents Bull's vision of information processing and computing solutions for the 1990s. It is technically expressed as a set of specifications for building applications and information systems in distributed multi-vendor environments. It serves as a flexible, common framework for customers, for partners and for Bull's own strategy for computing solutions.
 EDITORS' NOTE: There will be a teleconference with Jacques Noels of Zenith Data Systems and Beny Alagem of Packard Bell on the announcement at 4 pm. (EDT). Contact Mary Dlugosz at ZDS, 708-808-4848 or Lee McEnany or Philip Little at The Bohle Company, 310-785-0515 to reserve a space on this teleconference.
 -0- 6/22/93
 /CONTACT: Matt Mirapaul, John Bace of Zenith Data Systems, 708-808-4848; or Patrick Marx of Bull, 33-1-4696-8858; Liz O'Donnell, Lee McEnany of Bohle Company 310-785-0515 for Packard Bell/


CO: Bull; Packard Bell ST: Illinois IN: CPR SU: JVN

LG -- NY063 -- 4626 06/22/93 14:20 EDT
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Publication:PR Newswire
Date:Jun 22, 1993
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