Word: baileys
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...weeks ago, Conoco revealed that Du Pont was its choice as a partner. After five days of frantic negotiations capped by a midnight meeting on July 5 between Conoco Chairman Ralph Bailey and Du Pont Chairman Edward Jefferson, the two companies agreed to merge. Jefferson offered $7.3 billion, or an average price of $84.20 per Conoco share. The deal seemed to save Conoco from an unwelcome takeover bid from Canada's Seagram, which had offered $73 per share for about 41% of the oil company's stock. Conoco had also spurned an $85-per-share bid from Texaco...
...Bailey was bargaining with Cities Service, he and eight other top Conoco officers deftly moved to protect at least themselves in the merger game. Conoco's board of directors gave them new employment agreements that guaranteed the payment of their salaries at least through mid-1984. Bailey's own arrangement called for annual pay of $637,716 until 1989. Observed one cynical Conoco employee: "They equipped themselves with golden parachutes." The company also lined up $3 billion in stand-by bank credit. Conoco executives intended to buy back a large chunk of company stock from the shareholders...
...June 24, the day before the Conoco-Cities Service merger was to be announced, the phone rang in Bailey's office. The caller: Du Font's Jefferson. His question: "Is there any constructive role we can play?" Bailey thanked Jefferson for his concern about the Seagram bid, but replied that he was already negotiating with another company...
Within 24 hours Bailey was on the phone to Jefferson. "Now you can help," said Bailey. The merger talks moved swiftly, in part because Bailey, 57, the burly son of an Indiana coal miner, and Jefferson, 59, a London-born intellectual with a Ph.D. in chemistry, knew each other well. They had worked together on joint gas-exploration ventures that Du Pont and Conoco had begun three years ago in Texas. Jefferson flew to Stamford four times in the next eight days. All along, he assured Bailey that Conoco's management would not be changed...
Suddenly, in the midst of discussions between Du Pont and Conoco, another competitor appeared. Texaco made an offer for Conoco that was roughly comparable to Du Font's bid. But Bailey preferred to stick with Du Pont. He feared that even the Reagan Administration would balk at a merger between the two huge oil companies: a Texaco-Conoco combination would be larger than any U.S. energy firm except Exxon...