Blaming a market saturated with new stock offerings, Black & Decker Corp. postponed yesterday the initial public offering for PRC Advanced Systems Inc., its computer systems subsidiary.
It was the second unsuccessful effort by the Towson-based maker of power tools and appliances to sell the subsidiary since it was acquired as part of the purchase of Emhart Corp. in 1989.
The company's announcement came after Black & Decker made a series of presentations that failed to draw the desired number of institutional investors. "That's a sign of where the markets are," said Michael S. Karsner, Black & Decker's vice president and treasurer.
Mr. Karsner said that with interest declining in initial public offerings, an increasing number of institutional investors are focusing on secondary offerings, in which companies sell additional shares of stock.
Black & Decker announced in March that it planned to sell PRC in a public offering, hoping to raise $331 million to $363 million. The company also said then that it would be selling up to 20.7 million shares of Black & Decker common stock in a separate offering.
The sale of that stock, completed in late April, raised $465 million for Black & Decker, enough to satisfy debt payments through early 1994, a company spokesman said.
With the money from its earlier stock offering, the company does not have to rush into a sale of PRC, said Nicholas P. Heymann, an analyst for County NatWest Security USA Inc., an investment banking firm in New York.
However, he said he expects the sale of PRC to be difficult because of its heavy dependency on government contracts and the possibility of future cutbacks, particularly in defense. "This was going to be a challenging underwriting from the start," Mr. Heymann said.
PRC, which had been part of Emhart, designs, develops and supports computer systems. About 77 percent of its 1991 revenues were from government contracts.
When Black & Decker acquired Emhart, it planned to sell the PRC subsidiary.
But when there were no acceptable offers, PRC was taken off the market in the spring of 1990.