IBM UNHOOKS ROLM
By Carrie Gottlieb

(FORTUNE Magazine) – IBM has decided to call it quits with Rolm, a telephone equipment manufacturer that piled up an estimated $300 million in losses since the computer maker bought it for $1.5 billion in 1984. Big Blue had hoped that Rolm's technology could launch IBM into office telephone systems, or PBXs, that are Rolm's specialty. It also hoped Rolm's PBX customers would want to use IBM's Satellite Business Systems. Grand dreams, but in fact the acquisition was doomed (FORTUNE, June 9, 1986). The market grew more slowly than expected, and an increasing number of competitors began to squeeze profit margins. Rolm's new owner: Siemens AG of West Germany. The price was undisclosed, but is probably half IBM's original cost. Siemens will form a wholly owned U.S. subsidiary to handle manufacturing, development, and overseas marketing of Rolm products; IBM and Siemens will jointly market these systems in the U.S. Says Ulric Weil, a telecommunications consultant with Weil & Associates in Washington, D.C.: ''Siemens gains a stronger foothold for its products in the U.S. and eliminates a small competitor in Europe.'' And what's in the deal for IBM? ''It gets to exit the market gracefully.''C.G.