Word: berners
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Such a proxy fight was nothing new to Berner. He used one to win a seat on the board of Curtiss-Wright almost 30 years ago. During the past decade he was also involved in three similar, though smaller, battles. But despite the challenge, Kennecott prevailed in Round 1, winning the proxy fight by a scant 1.1 million shares out of approximately 26 million voted at the annual meeting of company stockholders in 1978. Then, five months later, a federal court set aside that decision saying that shareholders might have been unduly influenced by the last-minute court battle that...
Right from the start, however, there was trouble in the Kennecott boardroom. Berner objected that Barrow was "vastly overpaid" and forced the board to renegotiate the contract, which he said could have paid the chairman $27 million over five years. Berner also took exception to other perks, like a $5 million corporate jet for Barrow's personal use. Says a Curtiss-Wright insider of those board meetings: "Ted was the skunk at the picnic...
During the fall of 1980, Berner, who by then controlled 14.3% of Kennecott's stock, announced plans to increase Curtiss-Wright's holdings to 25%. Kennecott board members began fearing that he would start another fight for control of the company as soon as the cease-fire expired in May. Barrow, therefore, huddled with some of Kennecott's directors last November and then announced a pre emptive strike: Kennecott was going to take over Curtiss-Wright. Said one Wall Street source: "The apple had bitten the worm." The copper company offered Curtiss-Wright owners $40 a share...
...Berner nonetheless tried to fight off the Kennecott attack. Curtiss-Wright announced that it would buy back 1 million of its own shares at $44, and the price was soon raised to $46. That was $6 a share more than Kennecott offered. But the copper company, unable to attract enough Curtiss-Wright shares at $40, ended its offer and started negotiating with
Kennecott agreed to hand over its 2.8 million shares of Curtiss-Wright, plus $168 million in cash, in exchange for Curtiss-Wright's Dorr-Oliver subsidiary, a maker of pollution-control and other equipment; Curtiss-Wright returned 4.8 million shares of Kennecott to the copper company, and Berner and two other Curtiss-Wright directors resigned from Kennecott's board of directors. With their proxy fights at last over, Barrow and Berner can now get back to their real businesses of digging copper and building jet engines. -By Julie Connelly. Reported by Frederick Ungoheuer/New York