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Alagem returns to revive Samsung's AST

Licensing rights to a downcast subsidiary, the former Packard Bell NEC chief will rely heavily on the Net to conduct operations of the newly formed AST Computers.

Former Packard Bell NEC chief executive Beny Alagem acquired an exclusive license from Samsung's ailing AST Research and will manufacture PCs under the AST Computers brand name.

Alagem's new company will target small and midsized businesses as well as the home market, relying heavily on e-commerce, according to a prepared statement.

"We will use the Internet ? to offer the most innovative, sophisticated, and effective design, manufacturing, sales, and service and support to our customer base," Alagem said in a statement.

If the strategy is hardly novel, given the success of Dell and others, Alagem's rapid return is more surprising. Last September, Alagem formally resigned as chief executive of Packard Bell, having earlier announced his departure amid a lengthy sales slump that cost the Sacramento, California-based company its position among America's top five PC makers.

At the time, sources told CNET that Alagem was retiring because of health problems--Alagem suffered a heart attack in September 1997--but in an interview, Alagem said he was resigning because of a fundamental clash between Packard Bell's original executives, major shareholders NEC, and Groupe Bull.

Korean electronics giant Samsung will be an "indirect partner" in the new AST Computers, while AST Research, Samsung's U.S. subsidiary, will have a minority stake.

AST Research, also once a leading computer maker, has seen its market share and influence drop off considerably in the past few years. Previously ranked in the top five PC vendors, the company ranked only 17th in market share at the end of 1997, according to IDC.

"We are extremely excited about the prospects for this new company under the leadership of Beny Alagem," said AST Research chief executive Soon Taek Kim in a statement. "He was the first major executive in the industry to recognize the true potential of the personal computer in the home market."