TECHNOLOGY : Gateway Terminates Stock Majority Sale Plans With Conrac

Gateway Communications Inc., an Irvine computer network company, has terminated a deal to sell a majority interest to Conrac Technology Corp. in Duarte.

The companies gave no explanation for why the deal fell apart, though Gateway noted that Conrac reduced its offer from 95 cents a share to 88 cents a share after final negotiations began.

Gateway announced three weeks ago that Conrac, a maker of high-resolution computer monitors and other electronics equipment, would invest $5.9 million for a 55% stake in Gateway.

Ali Hussain, chief executive of Conrac, and Patrick F. Cadigan, chairman of Gateway, declined comment. At the time of the deal, Cadigan said in a statement that the Conrac investment would revitalize Gateway, which reported a loss last year of $2.3 million.

Gateway’s revenue fell to $10.4 million from $20.8 million last year as the company shifted its product line from making network adapter equipment--a market that was flooded--to creating remote access equipment for computers throughout a company.

Remote access equipment sales have been growing because of a trend toward home offices and mobile computing, in which people often connect to company computers over the phone lines.