NEW YORK - GAF Corp. stepped up its effort to take
over Union Carbide Corp. on Thursday with a new cash offer of $74 a
share for the 90 percent of Carbide's stock it does not already own,
or a total of about $4.5 billion.
The bid was $6 higher than its last offer, which encompassed 48
million shares, or 71.3 percent of Union Carbide's outstanding
Union Carbide, which has been opposing GAF's takeover attempt,
offered last week to buy back 35 percent of its shares for $85 each -
$20 in cash and $65 in securities. However, analysts have said the
market might value the securities at less than $65.
In a letter to Warren Anderson, chairman and chief executive
officer of Union Carbide, GAF Chairman Samuel J. Heyman called on
Union Carbide to stop resisting GAF's overtures and accept a peaceful
merger with GAF.
Otherwise, Heyman said, GAF will continue to stand by its latest
bid ""and to urge all other Carbide shareholders to do so as well.''
At Union Carbide's headquarters in Danbury, Conn., spokesman Tom
Sprick read a statement saying company officials had not received the
details of the latest ""revision of (GAF's) original, wholely
""When they do, our board of directors and management will review
them in the context of our unequivocal commitment to protecting both
the near-term and the long-term vital interests of our
shareholders,'' he said.
Union Carbide, which owns Presto Welding Supplies Inc., 2701 W.
Reno Ave. in Oklahoma City, said last week that if GAF acquired more
than 30 percent of Carbide shares, Union Carbide would increase the
scope of its offer to include 70 percent of its outstanding common
Some Wall Street analysts suggested the $65 in securities Union
Carbide offered might turn out to be worth less than $65, and that
GAF's latest offer might thus appear better by comparison.
""Heyman has offered $74 on the barrelhead, while Carbide's offer
is worth less than $70,'' said Peter E. Butler, an analyst at the
Paine Webber investment firm.
William Young, at Dean Whitter Reynolds, said the latest GAF offer
""looks pretty strong.''
""But,'' he added, ""we haven't heard the response from Mr.
Butler said that at this stage in the bidding, he thought it
unlikely that Union Carbide might find a ""white knight,'' the Wall
Street term for a company that rescues the target of a hostile
takeover bid by agreeing to a friendly merger.
""So if you rule out a "white knight,' what Carbide will have to
come up with is more cash, because adding more debt would not change
their offer any,'' he said. …