Word: bendix
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Dates: during 1980-1989
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...most wasteful takeover battles in U.S. corporate history. At its height, the contest was an unseemly spectacle of "cannibals gorging on one another," in the apt metaphor of Television Commentator Bill Moyers. Last week it ended with a whimper. In meetings at Southfield, Mich., and Morristown, N.J., shareholders of Bendix Corp. and Allied Corp. formally approved the merger of their companies. There was scarcely any dissent, but there was some sober reminiscing. Allied Chairman Edward L. Hennessy Jr., 54, said of the torturous maneuvering leading to the $2.3 billion deal: "It was a pretty sorry spectacle that gave American business...
Hennessy is a man who ought to know. Allied played the role of "white knight" in the merger mess, which was stirred up last summer when Bendix Chairman William M. Agee, 45, made a surprise tender offer for the shares of MX missile contractor Martin Marietta. But Martin Marietta turned the tables on Agee. The company promptly retaliated by trying to buy Bendix, and the result was a corporate donnybrook in which the two companies acquired huge chunks of each other and made headlines in the process. Finally Allied was called in by Bendix to buy Bendix stock and save...
...Bendix Corp. was locked in a bitter and ultimately losing takeover battle in September as company directors huddled to plot strategy. Among their hurried decisions: a so-called golden parachute for Chairman William Agee and 15 other Bendix officers. The chute, which was designed to protect the executives following a buyout by another company, guarantees Agee an $805,000 annual salary for five years even if he is fired. That lucrative arrangement was presumably authorized by the board's compensation committee and approved by the directors, as is typical in such cases. But at Bendix there was a twist...
Under Allied's takeover offer of $1.9 billion, some Bendix shareholders will emerge rich. Anyone who bought Bendix stock near its 1982 low of $45 per share could already have netted a windfall profit by selling out early to Martin Marietta at $75 per share. Before trading was halted last week, Bendix stock had fallen back to $57.50. Other shareholders, however, who wait to sell their stock to Allied, will be paid not in cash but in a combination of Allied stock and other securities, amounting to $85 per share. If the value of Allied stock now falls...
...clear winners in this war so far have been not the main combatants but their hired guns. Bendix employed two of the best-known investment banking firms, Salomon Brothers Inc. and First Boston, as well as three main law firms, along with three different public relations agencies. In all, the four companies are estimated to have spent $20 million on outside help of one sort or another. Was it money well spent? At one point in the thick of last week's battle, one investment banker observed of Bendix and Martin Marietta: "Both companies have wound up paying...