Apple denies bid talks as losses mount up

Click to follow
The Independent Online

Industrial Correspondent

Beleaguered Apple Computer yesterday denied talks of merger negotiations and warned of significantly worse losses in the second quarter than the $69m recorded in the first three months of the year. The company, which earlier this month ousted Michael Spindler as chief executive, blamed takeover speculation for flagging sales.

The company, once the star of the personal computer industry, also heralded further charges in its second quarter for redundancies and inventory write- offs. Apple's troubles hit the spotlight in the new year when it announced plans to lay off 1,600 staff.

The California-based firm has been dogged by rumours that Sun Microsystems or Motorola is poised to make a bid.

In a statement issued yesterday, Apple said it was "not currently in merger discussions with any party", but did not comment on whether such talks had ever taken place.

The company, which until now has refused to comment on the situation, complained of the "adverse impact on customer buying decisions". Apple said it decided to speak out "because of the destabilising effect recent rumours and speculation have had on our business and our organisation".

Gilbert Amelio, who took over as chief executive last week, is expected by some analysts to return the company to profitability by the fiscal year-end.

The appointment of Mr Amelio, regarded as something of a trouble-shooter, was taken as a sign that the company wished to remain independent.

Apple's famous Macintosh computer has long been losing ground to its rivals IBM and the software giant Microsoft. It now has just 7 per cent of the world market - half its share in the late 1980s.

Mr Amelio, who until days ago was chief executive of National Semiconductor, became known for his radical shake-up at the chip firm, including the closure of factories and revamp of the product range.

Mr Amelio said last week: "As an avid Apple user since the days of Apple II, I am delighted to be joining the management team of Apple, a company with an outstanding reputation for superior technology and customer loyalty."