SECURITIES AND EXCHANGE COMMISSION

                      WASHINGTON, D.C. 20549

                             FORM 8-K

                          CURRENT REPORT

              Pursuant to Section 13 or 15(d) of the
                 Securities Exchange Act of 1934

Date of Report (date of earliest event reported)   March 17, 1998           



                          LYNCH CORPORATION                            

      (Exact name of Registrant as specified in its charter)




         Indiana                       1-106                   38-1799862     
(State or other jurisdiction of)     (Commission File Number)   (IRS Employer
                                                              Identification
                                                                    No.)





8 Sound Shore Drive, Suite 290, Greenwich, Connecticut          06830        
(Address of principal executive offices)                        (Zip Code)





                                (203) 629-3333                               
       (Registrant's telephone number, including area code)
          



Item 2.   ACQUISITION OR DISPOSITION OF ASSETS

     On November 18, 1997, Registrant's majority owned subsidiary Spinnaker
Industries, Inc. ("Spinnaker"), entered into an Asset Purchase Agreement (the
"Asset Purchase Agreement") with S.D. Warren Company ("Seller") to purchase
Seller's pressure sensitive business (the "Pressure Sensitive Business"). 
Seller is a large pulp and paper producer owned by an indirect wholly owned
subsidiary of SAPPI, Ltd., a public South African conglomerate.

     The acquisition by Spinnaker of the assets relating to the Pressure
Sensitive Business (the "Acquisition") was consummated effective as of March
17, 1998.  Prior to the closing of the Acquisition, Spinnaker assigned its
rights and obligations under the Asset Purchase Agreement and related
transaction documents to its newly formed subsidiary, Spinnaker Coating-
Maine, Inc., a Delaware corporation ("Spinnaker Coating-Maine"), which
acquired the assets of the Pressure Sensitive Business.  Spinnaker Coating-
Maine will operate the Pressure Sensitive Business as a part of Spinnaker's
adhesive-backed label stock operations which are currently conducted by
Spinnaker Coating, Inc. (f/k/a Brown-Bridge Industries, Inc.), a Delaware
corporation and wholly owned subsidiary of Spinnaker ("Spinnaker Coating").

     The Pressure Sensitive Business is a major manufacturer and marketer of
pressure sensitive adhesive-backed label stock primarily for the electronic
data processing ("EDP") segment of the label stock market.  The Pressure
Sensitive Business generated $62.1 million of net sales in the fiscal year
ended October 1, 1997, which, on a pro forma basis, accounted for 21% of
Spinnaker's net sales for the twelve months ended September 30, 1997.

     The Acquisition is consistent with Spinnaker's long-term strategy for
expanding its presence in the market for adhesive-backed label stock. 
Spinnaker believes the addition of the Pressure Sensitive Business to
Spinnaker Coating's adhesive-backed label stock business will make Spinnaker
the fifth largest producer of label stock and the second largest provider of
EDP label stock.  Management of Spinnaker believes that the strategic
benefits of the Acquisition will be primarily derived from cross-selling
opportunities, overhead reduction, manufacturing efficiencies and purchasing
savings.

     Pursuant to the Asset Purchase Agreement, Spinnaker Coating-Maine
purchased from Seller substantially all of the assets (other than real
property) relating to the Pressure Sensitive Business.  In connection with
its purchase of the Pressure Sensitive Business, the parties entered into a
Site Lease, pursuant to which Spinnaker Coating-Maine will lease from Seller
a portion of the Westbrook, Maine facility for a term of 99 years at a
nominal rent of $1.00 per year, and a Site Separation and Services Agreement,
pursuant to which Spinnaker Coating-Maine shall obtain utility, supply
shipping, storage, maintenance and administrative services from the Seller. 
The parties also entered into a Space Lease, whereby Spinnaker Coating-Maine
will temporarily lease certain industrial space from Seller at its paper mill
for the operation of the Pressure Sensitive Business.

     The purchase price paid by Spinnaker for the Pressure Sensitive
Business was approximately $51.8 million, plus the assumption of certain
liabilities, subject to a working capital adjustment.  Spinnaker entered into
the Asset Purchase Agreement following its successful bid for the Pressure
Sensitive Business in an auction process completed in November 1997. 
Spinnaker valued the assets to be acquired by viewing historical and
estimated future cash flow of the Pressure Sensitive Business.  The purchase
price was paid by the issuance of a 10% subordinated convertible note (the
"Note") by Spinnaker to Seller, in the original principal amount of $7.0
million and the remainder with funds available under Spinnaker's asset-backed
working capital revolving credit facility with BT Commercial Corporation (the
"Revolving Credit Facility"), which was concurrently amended to increase the
aggregate facility amount to $60 million. 

     The principal amount outstanding under the Note is prepayable at any
time without penalty.  The Note has a payment-in-kind ("PIK") feature that
allows Spinnaker to pay interest accrued during the first year with an
additional subordinated note having substantially similar terms as the Note,
and Spinnaker may also issue such a PIK Note if at a future interest payment
date a default or event of default exists, or would be caused by the payment
of interest in cash, under the Revolving Credit Facility.  Payments of
principal and interest are subject to restrictions contained in, and in any
event are junior and subordinate in right of payment to, the payment of
indebtedness outstanding under the Revolving Credit Facility and Spinnaker's
10 3/4% Senior Secured Notes due 2006.  The Note matures on January 31, 2002,
however it is expected to be prepaid earlier if certain conditions or events
occur.  Prepayments of principal of 30% and 70% of the original principal
amount are due on March 31, 1999 and on March 31, 2000, respectively, subject
to there being sufficient unused availability and no existing default or
event of default under the Revolving Credit Facility.  The Note is
convertible for shares Spinnaker's Common Stock, no par value ("Common
Stock"), on the basis of 40 shares per $1,000 of the outstanding principal
amount of the Note (or $25 per share), subject to adjustment as set forth in
the Note.  Upon conversion of the Note, the holder thereof will be entitled
to certain registration rights with respect to the shares of Common Stock
received upon such conversion.

     The Pressure Sensitive Business' plant, which is highly automated and
efficient, specializes in manufacturing pressure sensitive materials.

     This document contains certain forward looking information.  Such
information is based on certain assumptions and estimates and, accordingly,
may be subject to risk, uncertainty and inaccuracy.

          Item 7.   FINANCIAL STATEMENTS AND EXHIBITS.

     (a)  FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.

     At this time it is impracticable to provide the required consolidated
financial statements; therefore, the required financial statements will be
filed with the Commission by amendment no later than May 29, 1998.

     (b)  PRO FORMA FINANCIAL INFORMATION

     At this time it is impracticable to provide the required pro forma
financial information required pursuant to Article 11 of Regulation S-X;
therefore, all required pro forma financial information will be filed with
the Commission by amendment no later than May 29, 1998.     
     (c)  EXHIBITS

     *2.1     Asset Purchase Agreement dated as of November 18, 1997, by and
              between S.D. Warren Company ("Seller") and Spinnaker.

     *2.2     First Amendment to Asset Purchase Agreement dated March 17, 1998,
              by and between Seller and Spinnaker.

     *4.1     Subordinated Note dated March 17, 1998, issued by Spinnaker to
              Seller in the original principal amount of $7 million bearing
              interest at a rate of 10% per annum.

    *99.1     Site Separation and Services Agreement dated March 17, 1998, by
              and between Seller and Spinnaker.

    *99.2     Lease Agreement dated March 17, 1998, between Seller and
              Spinnaker.

    *99.3     Fourth Amendment to the Credit Agreement dated as of October 23,
              1996, among Central Products Company, Brown-Bridge Industries,
              Inc., Entoleter, Inc. Spinnaker as guarantor, each of the
              financial institutions party thereto from time to time, BT
              Commercial Corporation, as agent, Transamerica Business Credit
              Corporation, as collateral agent, and Bankers Trust Company as
              issuing bank (the "Credit Agreement"), made as of December 31,
              1997.

    *99.4     Fifth Amendment to the Credit Agreement.

    *99.5     Sixth Amendment to the Credit Agreement.

    *99.6     First Supplemental Indenture dated as of March 17, 1998, among
              Spinnaker, Central Products Company, Entoleter, Inc., Spinnaker
              Coating, Inc., Spinnaker Coating-Maine, Inc. and The Chase
              Manhattan Bank, as Trustee.
                      
*    Incorporated by reference to the corresponding exhibit and number of the
Form 8-K of Spinnaker Industries, Inc. dated as of March 17, 1998.


     Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.

                                        Lynch Corporation



Date: April 1, 1998                     By: s/ Robert E. Dolan     
                                               Robert E. Dolan
                                               Chief Financial Officer