Dallas Merrell, the wealthy Montgomery County businessman who was challenging Lawrence J. Hogan for the Republican nomination for the U.S. Senate, plans to announce today that he is withdrawing from the race.

Merrell's withdrawal, caused by his inability to raise money, leaves Prince George's County Executive Hogan as the only candidate filed for the Sept. 14 GOP primary to choose an opponent for Democratic incumbent Paul S. Sarbanes.

Merrell's decision again raises speculation about whether former U.S. Sen. J. Glenn Beall Jr. will enter the race. With Hogan unopposed, pressure on Beall is likely to increase. Contacted at home last night, Merrell said he spoke with Beall yesterday morning to ask him again if he intended to run.

"He said that he still hadn't made up his mind," said Merrell. "Ever since I announced my candidacy, questions have been raised about other candidates getting into the race. That has affected my ability to raise funds."

Merrell said he met with his staff late yesterday and then spoke to his family before deciding to get out.

"I just don't see the necessary finance base to raise the funds needed to defeat Paul Sarbanes in November," Merrell said, reading from the statement he plans to release today. "I am making this decision in the best interests of party unity . . . I have not decided whom I will support during the primary, although I will support our party's nominee during the general election."

Merrell then took a subtle shot at Hogan, saying he plans to devote himself to the campaign of gubernatorial candidate Robert A. Pascal "because I feel he has the best chance of anyone in the party to win in November."

Merrell said his campaign, which was considered to be extremely well organized, with much of his staff coming from the Republican National Committee, raised less than $100,000. With Sarbanes' contributions already approaching $750,000, the Merrell campaign faced an uphill fight even if it did upset Hogan in the primary. The lack of funds prevented Merrell, who never has held elective office, from getting on TV in the Baltimore and Washington markets, something an unknown candidate must do in a statewide race.

Merrell said last night he considers his withdrawal an interruption, not an ending. "This is just a delay," he said. "I am still certain that I will attain a seat in the U.S. Senate. My decision to run this time was a rational one and I was gaining support. But the lack of funds made the job a little bit too tough this time."