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Compaq to rewire network unit

The PC maker will reorganize its networking operations in the aftermath of the Digital merger and the departure of a high-level executive.

Compaq Computer will reorganize its networking operations in the aftermath of the Digital Equipment merger last week and the recent departure of a high-level executive.

William Johnson will become vice president of Compaq's newly created network and access communications division, a unit under the company's enterprise systems and solutions business. Johnson replaces Alan Lutz, former general manager for what was then known as Compaq's communication products group.

Lutz recently became president and chief operating officer at Newbridge Networks, a wide-area networking equipment provider, replacing Peter Charbonneau.

Compaq's networking efforts have suffered from a variety of management changes and high-profile systems company acquisitions, despite repeated reassurances that its networking business remains a priority.

Recently, Compaq has stepped up its efforts once again. The merger is sure to give its business a jolt, as Digital has a deal with Cabletron Systems essentially to resell more than $1 billion in Cabletron networking equipment over the next three years. Cabletron purchased Digital's networking business in a complex deal last fall.

"We have a real opportunity to fill out our product offering," Johnson said.

He added that Compaq would set up its networking headquarters in Littleton, Massachusetts--the site of Digital's former networking base. Other elements of the networking business will remain in its Austin and Houston, Texas, and Norwood, Massachusetts locales.

Amid the Texas tumbleweeds, there have reportedly been rumors that a Compaq acquisition of struggling Cabletron could be in the works, but Johnson said his company would take two or three quarters to digest the mammoth Digital deal before moving forward with other possible purchases.

"I don't see [an acquisition] happening any time soon, but clearly I'm always thinking about that," Johnson said.