History of mergers and acquisitions

Du pont springs a surprise $7 billi0n offer for resource-rich Conoco

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 US.

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 Edword Jefferson flew from his headquaters in wilmington, Del. aboard a king Air twin-engine turboprop to stamford, conn, for a midnight meeting with Conoco chairman Ralph Bailey in that company's boardroom rotunda. Just after 1am. the two weary; rumpled chief executive settled final details, sealed the agrement with a hand shake and retired to of scotch and bourbon. Du pont was paying some $7 billion in cash and stock for Conoco. The union could form the seventh largest industrial enterprise in the U.S. ranking just behind the ford motor co.

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 of flock of suitors har fought over Conoco in a bidding battle as frenzied as a 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 US. oil firm.

The fierce competition for merger mania that is sweeping the US. This year alone, seven deals each worth $2 dillion or more have been started or completed lile 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 US. industry. The Reagan Administration seems to be encouraging the merger markess and Attorney General William French smill proclaims, " Bigness does not necessarily mean badness"

The 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 pome petroleum bought 20% of Conoco's stock. The Us. 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 to buy 35% of the oil firm's shares. Edgar Bronfman, Seagram's adrogt chairman, it currently on the hunt for new acquisitions with nearly $3 billion, gained largely from the sale of Texas oil and gas properties.