Word: fu
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Dates: during 2000-2009
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...CNOOC's run at Unocal, no one had exactly covered themselves in glory. Fu, the personable CEO who had gone to graduate school in Los Angeles near Unocal's headquarters, had taken a pratfall right out of the gate back in late March, failing to inform his board members about the bid until just two days before he was going to launch it. When virtually the entire eight-member board?and not, as earlier reports had it, just the outside directors?balked, Fu had to back off. That allowed Chevron to make the first bid, and forced CNOOC to play...
...Still, it took a while, one CNOOC board member says, for "reality to impinge." As late as three weeks ago, Fu and his bankers were still gung-ho, preparing to bid between $72 and $73 per share for Unocal?up from their initial $67 offer. Then, on July 19, came word that CNOOC's largest private shareholder, investment firm William Blair & Co. in Chicago, was dumping its entire stake in CNOOC?$141 million?fearful that Fu would overpay for Unocal. "We're not in favor of the bid," said David Merjan, a fund manager at the firm...
...That, says one source close to the CEO, "got Fu's attention, absolutely." For all the efforts of those opposed to CNOOC to portray it as part of a government monolith immune to commercial pressures, Fu and his managers have run one of the most transparent?and shareholder-friendly?companies in the new China. It stung when the largest private shareholder dumped its stake and publicly decried the possibility of a deal. Facts on the ground were piling up, and soon Fu began to prepare his retreat...
...From the outset, one of the mysteries surrounding CNOOC's bid was the precise nature of Beijing's role in it. Fu always insisted that the Chinese government had no involvement, but that, to many observers, seemed implausible. Chinese energy companies have been scouring the globe for resources under the government's "go out" policy. One source close to CNOOC's top management believes the government "tolerated" the bid. But once it became clear that CNOOC's ambitions had become a flash point in an already tense relationship with the U.S., whatever enthusiasm there was began to wane...
...Unocal's board had, on July 21, reaffirmed its commitment to Chevron after its CEO, David O'Reilly, had sweetened his offer. On August 10, Unocal's shareholders were to choose between the two suitors. Rather than increase his bid, as his bankers urged, Fu folded. By the end of the August 4 meeting with his board in Beijing, the mood had lightened somewhat. "You got the sense that we were at least beginning to look at this whole episode in a slightly different way," says one participant. Already, there is speculation in the markets about who else the Chinese...