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Oregon's Sequent to merge with IBM Wire and staff reports BEAVERTON -- Another of Oregon's large publicly held companies is headed the way of the merger. Sequent Computer Systems Inc., a struggling maker of powerful business computers and one of the state's biggest high-tech players, will be bought out by IBM in a $810 million deal announced Monday that aims to fill an important slot in IBM's product line. Sequent ranked as the state's eighth largest publicly held company in last year's revenue rankings compiled by Oregon Business Magazine. Since those rankings were compiled, the state's third-largest company, Fred Meyer, has been absorbed by Kroger Corp. and the second largest, PacifiCorp, has announced plans to be bought out by ScottishPower in a deal awaiting regulatory approval. Beaverton-based Sequent has about 2,500 employees worldwide and 1,500 in Oregon. No layoffs are expected. "This is all about growth and not about consolidation or cutting jobs," said IBM senior vice president Robert Stephenson, adding that he expects IBM to expand operations in Oregon. Sequent, though far smaller than Big Blue, is a leading seller of brawny machines that run on Intel computer chips, expected to be the next corporate computing trend. IBM, the world's largest computer maker, uses its own chips as the brains of powerful mainframe computers, which process everything from millions of bank transactions to inventories. It plans to use Sequent's technology to sell networked "server" machines that are an inexpensive and flexible substitute to mainframes. Although Intel chips are not widely used to power these server machines, that will start to change next year, when the No. 1 chip maker releases a long-awaited next-generation chip known as Merced. Merced is intended to work with high-end business machines that run either Unix -- the traditional operating system for such computers -- or Microsoft's Windows NT, which is rapidly gaining market share. IBM, based in Armonk, N.Y., hopes to greatly increase sales of Sequent machines by pitching them through its giant sales force. IBM plans to sell Sequent's computers as well as integrate Sequent's technology into its own machines. Despite Sequent's leading technology, the company has succeeded only in attracting a handful of major corporate customers. Its financial results have been viewed by Wall Street as mediocre, losing $53 million last year on sales of $784 million. Sequent chief executive Casey Powell, who will continue to head up Sequent's operations under IBM, founded the company in 1983 after heading Intel's microprocessor operations. Sequent will be folded into IBM's more than $12 billion server division. Today's Business Index Mail Tribune Copyright � The Mail Tribune 1999, Medford, Oregon USA