Word: kennecott
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Berner eyes Kennecott cash...
Takeover artists are often suspected of wanting to tap the till of the target company, but hardly any ever admit it-let alone boast about it. An exception is T. Roland Berner, chairman of Curtiss-Wright, who is campaigning to unseat directors of Kennecott Copper and install his own board in a shareholder election May 2. In the most unusual proxy statement in recent years, Berner last week vowed that if Curtiss-Wright gets control, it will distribute some $660 million of Kennecott's assets to stockholders-who prominently include Curtiss-Wright. It owns 3.3 million Kennecott shares...
Curtiss-Wright did make a peaceful effort last month to get minority representation on the Kennecott board. But Kennecott's dour and demanding chairman, Frank Milliken, 64, turned down the request. So T. Roland Berner, 67, Curtiss-Wright's chairman, declared war by nominating a slate headed by himself to take control. The rather geratic group includes George Moore, 72, former chairman of Citicorp; Robert Meyner, 69, former Governor of New Jersey; George Bunker, 70, former chairman of Martin Marietta; and Fred Kirby II, 58, chairman of Alleghany Corp. and Investors Diversified Services, the mutual fund concern. Curtiss...
That siren song should win some ready listeners. When the big copper producer was forced to divest itself of Peabody Coal by Government edict last June, savvy Wall Street analysts speculated that some or all of the $1.2 billion Kennecott received would be paid in the form of a special dividend. Instead, Chairman Milliken, apparently fearing an unfriendly takeover attempt, paid $66 a share for Carborundum. The rationale: the bigger the company, the more difficult it is to finance a raid. By paying more than twice the book value for a ho-hum company, Milliken let himself in for savage...
...Berner succeeds and severs Carborundum, what is left of Kennecott will be anything but a prize property. One of the world's highest-cost copper producers, Kennecott thrives only when prices of its metal are handsome. Last year profits were a pittance of $300,000 on sales of $977 million. Copper inventories of more than 2 million tons are now overhanging the market, forcing the U.S. spot price down to about 620 per lb., below Kennecott's average cost. Some analysts, however, believe that copper might go as high...