Dukakis Defies Liberal Label; Takes Stand with Management against "Mergermania"

By Stefan Fatsis, Ap | THE JOURNAL RECORD, August 4, 1988 | Go to article overview
Save to active project

Dukakis Defies Liberal Label; Takes Stand with Management against "Mergermania"


BOSTON - When Revlon Group made a hostile bid to seize Boston's own Gillette Co., Gov. Michael S. Dukakis engineered passage of a state anti-takeover law and signed it with fanfare on a Gillette softball fied.

When Campeau Corp. bought Federated Department Stores, Dukakis asked the Federal Trade Commission to review the $6.6 billion purchase, which included Filene's Basement, the discount store where the governor buys his suits.

On the campaign trail, the Democratic presidential nominee has said ``merger-mania'' is ``tearing companies apart as if they were erector sets.'' And he has called for tougher enforcement of federal antitrust laws and regulations to protect management against takeover artists seeing to make a fast buck.

In a state where sharks circle regularly around corpoate giants such as Gillette and Polaroid Corp., Dukakis, portrayed as a liberal by his Republican opponents, has forged an alliance with management in attacking corporate raiders.

``He's very concerned about hostile takeovers that lead to protracted battles, cost jobs, might result in paying greenmail and don't create new economic value,'' said Harvard Business School Professor Rosabeth Moss Kanter.

``However, he's very well aware that there are a large number of mergers and acquisitions and some takeovers that replace weak management with stronger management or result in combinations that do create new economic value,'' the Dukakis adviser said.

Wall Street analysts acknowledge some trepidation among potential buyers over a possible Dukakis presidency. Some fear he will try to curb takeovers; others worry that a recession will dampen the merger wave, as it did after last year's stock market crash. With the future uncertain, merger activity has spurted in recent months.

``There is some basis to say that were Dukakis to win, then antitrust enforcement would be moe vigorous than under the Reagan Administration,'' said Les Fabuss, senior vice president for mergers at Shearson Lehman Hutton Inc. ``But I don't think Dukakis would be Draconian on this. He tends to be middle-of-the-road is my impression.''

Dukakis is on the record supporting measures to curb hostile takeovers, including:

- A Senate bill sponsored by Sen. William Proxmire, D-Wis., to force raiders to make their efforts more public.

- Outlawing greenmail, the premium paid by a company to buy back stock from a raider who agrees to drop a takeover bid.

- Reducing the 10-day period in which a company can acquire a block of another company's stock without disclosing whether it intends to mount a takeover.

- Stricter enforcement of antitrust and insider trading laws.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Cite this article

Cited article

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

Dukakis Defies Liberal Label; Takes Stand with Management against "Mergermania"


Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?