INVESTORS MAY TAKE COMPUTERLAND PUBLIC
The investor group that has agreed to
buy <Computerland Corp> will likely take the leading personal
computer retailer public or sell it to other investors,
industry analysts said.
    "Now's a good time," said Joe Levy of International Data
Corp. "The personal computer industry has bottomed out and is
on the way up again," he said.
    Earlier today, closely held Computerland, the largest PC
retailing chain in the country, said it agreed to be bought by
an investor group led by E.M. Warburg Pincus and Co, New York.
    Neither Computerland, which is 96 pct owned by its founder,
William H. Millard, nor E.M. Warburg, a money management and
venture capital firm, would disclose the value of the
transaction.
    Analysts estimated that Computerland, whose 800 stores
generated 1.4 billion dlrs in sales last year, would fetch  150
mln dlrs to 250 mln dlrs. Computerland franchise owners pay
royalties averaging 5.9 pct to the parent company.
    Officials for E.M. Warburg referred all questions to
Computerland. Computerland officials could not immediately be
reached for comment.
    E.M. Warburg currently manages 1.5 billion dlrs in venture
capital funds, and its past investments have included Mattel
Inc <MAT> and the Ingersoll newspaper chain. It is also a money
manager, with 3.5 billion dlrs under management.
   Although the PC retailers are benefitting from the strong
upturn in PC sales, analysts said Computerland must make key
changes if it is to fend off advances from rivals like
Businessland Inc <BUSL.O> and Tandy Corp's <TAN> Radio Shack
stores. "The name of the game now is outbound sales forces,
customer service and customer support," said Levy of
International Data.

    Relations between Computerland and its franchise owners
have mellowed recently after Millard was forced to give up
managment control of the company in 1985.
    Ed Faber, who took over as chairman and chief executive
officer, revamped the company's royalty plan, which help quell
much of the franchisee dissent.
   
 Reuter
