The Acquisition Front
Action along the acquisition front moved at a brisk tempo last week.
Items:
> Signal Oil & Gas Co., the Los Angeles-based giant (1966 sales: $1 billion) that aims to strike it rich away from the oilfields as well as in them, added Mack Trucks Inc. to a list of holdings that already includes 48% of American President Lines and Garrett Corp., a manufacturer of aerospace components. Signal lost out in a bid for ailing Douglas Aircraft last winter, but the Allentown, Pa., truckmaker was only too glad to get under Signal's rich corporate umbrella. Despite record sales ($412 million in 1966), Mack has been desperately short of capital needed to expand its 20,000-a-year truck output and increase its 15% share of the heavy-duty-truck market. Signal had hardly settled the Mack merger terms, involving some $185 million in securities, when it reached in yet another direction to buy, for some $17 million in securities, Arizona Bancorporation, a Phoenix-based holding company with interests in banking, land, steel and insurance.
> Montgomery Ward & Co. scotched weeks of Wall Street rumors that it was a ripe-and-ready takeover target by announcing plans for an acquisition of its own. Robert E. Brooker, chairman of the Chicago-based retailing and mail-order giant, said Ward would buy Los Angeles' MSL Industries Inc. for some $90 million in securities as a first step toward building "a substantial manufacturing complex." MSL last year rang up $116 million in sales of industrial fasteners, plastics and other products, earned $6.4 million--which is just the sort of tonic Ward can use. Suffering from tight pressure on profit margins, Ward cleared only $16.5 million from its record 1966 sales of $1.9 billion.
>Dan River Mills, a medium-sized Virginia textile firm (1966 sales: $281 million), and smaller, North Carolina-based Fieldcrest Mills ($171 million) decided to copy the long-established industry pattern by merging. If stockholders approve a swap of securities worth some $87 million, the merged company will have combined sales of more than $450 million, a strong position as the U.S.'s fourth biggest publicly owned textile company (after Burlington Industries, J. P. Stevens & Co. and United Merchants and Manufacturers), and a new name: Dan River Fieldcrest Inc.
> American Radiator and Standard Sanitary Corp., the nation's No. 1 in heating equipment, commodes and other plumbing fixtures, announced an amicable bid to buy out its Manhattan neighbor, Mosler Safe Co. American Standard hopes to "diversify our dependence on the construction industry," whose current slump has pulled the chain on the company's profits. Despite record sales of $569 million, earnings plunged 44% to $10,350,000 in 1966 and are down by 86% so far this year. The company offered $38.50 a share for the rich safe-and-office-equipment maker, whose sales ($64 million) and profits ($4.4 million) have more than doubled since 1962. For Chairman John Mosler and the Mosler family, the sale means that their 46% holding will bring some $40 million in cash.
> Greatamerica Corp., a Dallas-based insurance and banking combine controlling assets of more than $2 billion, which blandly described its spectacular 1964 Braniff Airways takeover as "a limited departure from our general goals," suddenly departed again--much to the shock of Cleveland's Glidden Co. Without warning, Glidden was hit with a Greatamerica tender seeking to buy 54% of Glidden's stock for $30 a share, or $107 million all told. Texan Troy V. Post, Greatamerica's president, was not saying why he wanted the comfortably prosperous (1966 sales: $352 million) food, chemical and paint company. But Glidden President William G. Phillips was quick to warn stockholders that "Greatamerica knows that Glidden stock is worth substantially more" than $30. And at week's end, he was huddling with a friendly merger prospect, General Aniline & Film Co., to prove it.
This file is automatically generated by a robot program, so reader's discretion is required.