Unisys Leader Becomes Second CEO to Step Down

James A. Unruh on Thursday became the second chief executive to leave Unisys Corp. without turning it into the computer giant many have sought to create.

Unruh, 56, said he will stay on as CEO until a successor is named. He plans to relinquish his post as chairman by April 1998.

“It has become increasingly clear to me that this is the right time for a change for both the company and for me personally,” Unruh said. The company’s largest stockholder, Greenway Partners, had sought his ouster.

Unruh succeeded W. Michael Blumenthal, a former U.S. Treasury secretary who led the company after it was formed in the 1986 merger of Sperry Corp. and Burroughs Corp. Blumenthal resigned after a disastrous 1989 that ended with Unisys reporting a $639-million loss.

Blumenthal had originally hoped the company would reach $20 billion in annual sales by the early 1990s and become a major competitor to International Business Machines Corp. Unisys closed 1996 with $6.37 billion in sales.

On Thursday, shares of Blue Bell, Pa.-based Unisys gained 87.5 cents to close at $7.875 on the New York Stock Exchange.

When Unruh took over, he had more modest expectations, noting the competitive nature of the industry and concerns about the global economy.

The company, saddled with more than $2 billion in debt, has struggled to reposition itself in recent years as mainframe computers, its core business, have lost ground to smaller computers. Unruh has overseen four reorganizations and cut the payroll by nearly two-thirds.

After a series of quarterly losses, the company made a $19.3-million profit in the first quarter this year, and Unruh said the company was on track to report a profit for all of 1997.

“With a sound plan to grow the company now in place, ensuring a smooth and orderly transition to new leadership will enable Unisys to continue to achieve improved results without interruption,” he said.

Although the company’s financial performance has improved some since a 1995 decision to split into three divisions, stockholders remained dissatisfied.

In April, shareholders complained about the stock performance, but New York-based Greenway Partners failed to win enough support for a no-confidence vote in the board of directors.