Word: anacondas
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Dates: during 1970-1979
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...classic response by a company facing an unwelcome takeover bid is to try to sell itself to another firm. Anaconda Co. did just that-for understandable reasons-after New York's Crane Co. came calling last year. Anaconda is in the red, and Crane Chairman Thomas M. Evans is known for his ruthless sacking of money-losing managers. Last week Anaconda found a giant protector: it and Houston-based Tenneco Inc. announced plans for what would be one of the biggest mergers ever in terms of total revenues-if it can be brought off over Evans' opposition...
...merger would unite companies with annual sales of $6.7 billion. Tenneco, whose profits rose to a record $342.9 million on $5.6 billion in sales last year, is a natural-resources and gas-pipeline firm, with interests ranging from chemicals to shipbuilding. Anaconda mines and processes copper, aluminum and other metals and manufactures a wide range of industrial materials. Recently the firm has been buffeted by reverses, including the 1971 expropriation of its huge Chilean copper holdings, falling copper prices and a slump in demand for Anaconda's products. Result: a $39.8 million loss in 1975 on revenues...
...Spotting a company that seemed ripe for takeover, Crane, which produces steel, valves and aerospace equipment and has sales of more than $1 billion a year, made its bid last fall. It offered a debenture with a market value of $17.58 paying 8% interest for each of 5 million Anaconda shares, or 23% of the total. Tenneco proposes to take all Anaconda stock in exchange for a new issue of Tenneco preferred, convertible into common. The terms work out to stock worth about $22 for each Anaconda share; Anaconda closed last week...
...catch is that the deal needs approval by holders of two-thirds of Anaconda's stock-and Crane already has gathered in 18% of the shares, or more than half the amount needed to block the merger. Evans, a master of the takeover game, is no man to back away from a fight. "He loves a contest, thrives on it," says a onetime associate. "He's an asset player-buys them cheap." Predictably, Evans declared last week that he would vote Crane's shares against the Tenneco merger...
...Garlock Inc., a producer of leakage-control devices for pipes and machinery, last week withdrew a court suit against a tender offer by Colt Industries, which increased its bid to $35 a share from $32. In other tender offers now being contested, Crane Co. is seeking shares of Anaconda Co. and Babcock & Wilcox is seeking control of American Chain & Cable...