IBM to Sell Part of Rolm, Put Remainder Into Joint Venture

NEW YORK — International Business Machines Corp. will sell part of its money-losing Rolm phone gear business to West Germany’s Siemens AG for an undisclosed price and put the rest of Rolm into a joint venture with Siemens, the companies said today.

The deal will not have any material effect on IBM’s earnings and IBM employees will be offered jobs with Siemens, with the joint venture or elsewhere in IBM, the company said.

IBM will sell the development and manufacturing arm of Rolm, with its 5,500 employees, to Siemens, where it will become Rolm Systems Inc. and include 700 employees now working for Siemens.

IBM and Siemens will jointly own a marketing and services company, known simply as Rolm, that will offer telecommunications products for private networks in the United States. It will have 5,500 employees who currently work for Rolm and fewer than 100 now working for Siemens.

In addition, IBM will gradually phase out a Rolm manufacturing and development plant in Colorado Springs, Colo., and offer jobs elsewhere in the company to employees there.

IBM bought Rolm for $1.5 billion in 1984 to help it in the business of tying together computers and the phone network. Under IBM’s ownership, Rolm has steadily lost money, although its share of the U.S. market has risen to 18.1% from 14.2% in 1984, according to Northern Business Information-Datapro.

Earlier story, Part IV, Page 2.