AT&T pursues Teradata, leader in data bases

December 03, 1991|By Los Angeles Times

LOS ANGELES ...F... — LOS ANGELES -- In a major challenge to IBM in the $13 billion commercial data base market, AT&T said yesterday that it will acquire computer-maker Teradata in a friendly stock swap valued at $520 million and combine it with AT&T's NCR Corp. computer subsidiary.

Analysts said that the combination of Teradata's strength in advanced data base technology and NCR's market presence in high-tech cash registers, automatic-teller machines and computer terminals would help AT&T compete with International Business Machines Corp. in the market for commercial data base computers and software. That market is expected to grow to $40 billion within four years.

In over-the-counter trading yesterday, Teradata shares jumped $5.125 to close at $28.875 on the news of AT&T's offer to exchange $30.25 of its common stock for each of Teradata's shares.

Teradata, a 12-year-old company with sales of $258 million last year, is considered a leader in applying parallel processing technology to very large commercial data bases, such as those used by retailers, banks and insurers. Parallel processing harnesses many information processors at once to work simultaneously on one problem and get it done faster.

The resultant system is known as "decision support." It can inform a chain's managers immediately when sales of pink bras, say, are slowing in San Francisco and Los Angeles but picking up in Denver.

The stores can then ship the goods to Denver and sell them at full price rather than mark them down locally, as they might do in the absence of up-to-date, chain-wide information.

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