Word: kennecott
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Sohio follows the pack by bidding for Kennecott...
When Thomas D. Barrow, 56, resigned as a senior vice president of Exxon in 1978 to become chairman of Kennecott Corp., the nation's largest copper company (1980 sales: $2.3 billion), he probably figured that his days in the oil business were over. But suddenly last week Barrow found himself back with another oil company. Standard Oil of Ohio made a successful bid to buy Kennecott for $1.8 billion in cash...
...deal is a bonanza for shareholders of Kennecott. Before the agreement was announced, the company's stock was trading for about $27 a share; Sohio is willing to pay about $62. The acquisition also looks promising for Sohio, the U.S.'s 14th largest refiner. The company owns 33% of the trans-Alaska pipeline and has been turning North Slope crude into cash. Last year it had profits of $1.8 billion on revenues of $ 11 billion. Sohio, which already owns some coal and uranium mining operations, has been looking around recently for profitable places to spend its spare cash...
Sohio's proposed purchase of Kennecott marks the third time this month that companies flush with oil profits have sought to use that money to buy mineral and mining firms. Standard Oil of California bid $4 billion for the 80% it does not already own of Amax, which has vast reserves of molybdenum, a metal used to make special steel alloys, and nickel. Seagram Co., the whisky distiller, which sold $2.3 billion worth of Southwest oil and gas properties last month, has offered more than $2 billion for St. Joe Minerals, a producer of lead and zinc...
...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