Tustin, California-based MAI Basic Four Inc may finally have made Prime Computer Inc an offer it can’t refuse. MAI is now offering to buy only Prime’s minicomputer business, for $450m cash and $150m in payment-in-kind debentures. The offer covers the proprietary 50 Series minis, the Primos operating system and directly related software, and looks like the answer to a maiden minimaker’s prayer, getting it out of the proprietary mini business at a time when it has emphatically gone ex-growth, and enable it to accelerate the transition to industry standards and Unix that Prime wants to make anyway. However the downside is that Prime would not be left with a lot of cash to invest, because MAI’s offer presupposes that Prime would use the $450m to buy in some of its shares at $22.50 a share, thus making MAI’s offer an improvement with regard to value to shareholders over the $21.50-a-share offer by J H Whitney & Co that Prime has accepted, and that each Prime share not bought in would receive a distribution of $3.50. Prime would be left with its leasing business and a large portfolio of computer-aided design software, and would have a breathing space to decide whether it should build its own Unix machines on which to run it, or buy all its hardware OEM. Prime said its board will meet to consider the offer after the directors have had time to evaluate it. It is is very difficult to see the attractions of the Prime minicomputer operations to MAI.
