Word: conoco
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Dates: during 1980-1989
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While most Americans were enjoying fun and fireworks on the Fourth of July weekend, teams of executives from Conoco Inc. and Du Pont and Co. had forsaken friends and family to work almost round the clock on the biggest merger in U.S. corporate history. Du Pont, the largest U.S. producer of chemicals, had secretly offered to buy Conoco, the ninth biggest American oil company. After five hectic days of staff work, the deal seemed set. On Sunday night of the July Fourth weekend, Du Pont Chairman Edward Jefferson flew from his headquarters in Wilmington, Del., aboard a King Air twin...
That marriage, however, is not totally certain. The deal still has to be accepted by stockholders of both Du Pont and Conoco. For two months a flock of suitors had fought over Conoco in a bidding battle as frenzied as an auction for a newly discovered Rembrandt. The other most serious contenders: cash-laden Seagram Co. of Canada, the world's largest liquor distiller, and Texaco, the third biggest U.S. oil firm...
...fierce competition for Conoco is only the latest manifestation of the merger mania that is sweeping the U.S. This year alone, seven deals each worth $2 billion or more have been started or completed. Like baseball club owners plucking off free agents, corporate captains are choosing up sides in a wild scramble that could bring significant shifts in the balance of power throughout U.S. industry. The Reagan Administration seems to be encouraging the merger makers, and Attorney General William French Smith proclaims, "Bigness does not necessarily mean badness...
...Conoco-Du Pont agreement was the climax of a complex drama of high finance. It began with unwelcome assaults on Conoco by two Canadian companies. The first came in May, when Dome Petroleum bought 20% of Conoco's stock. The U.S. company fended off that threat by agreeing to trade its majority interest in the Hudson's Bay Oil and Gas Co. in return for the Conoco stock that Dome had acquired. At the same time, however, a more ominous Canadian challenger appeared. In late May, Seagram privately approached Conoco with an offer...
...Conoco's executives saw no way that a large oil concern could be rationally integrated into a liquor company. They also feared that Seagram would bring in new management. Around the oil firm's headquarters, employees bitterly joked that the motto of a combined Seagram-Conoco enterprise would be "Drink and Drive." Chairman Bailey quickly searched for an alternative merger partner, or so-called white knight, to thwart Seagram's plans. His first choice was Tulsa-based Cities Service, an oil company less than half Conoco's size but with exploration rights to 10 million...