Northrop to halt hostile bid for TRW until Sept. 30

Truce allows suitor a chance to look at books

May 09, 2002|By BLOOMBERG NEWS

LOS ANGELES - Northrop Grumman Corp. agreed yesterday to halt its $12.2 billion hostile takeover bid for TRW Inc. until Sept. 30 while it reviews the smaller defense contractor's financial information, according to a regulatory filing.

The length of the so-called standstill agreement had been at the center a dispute between the companies about opening talks about a possible Northrop acquisition. TRW, based in Cleveland, had sought a delay of as long as three years.

The agreement could be extended an additional year if TRW announced on or before Sept. 30 that it had entered into a combination involving the sale of all or most of the company, according to the Securities and Exchange Commission filing.

Northrop agreed to the accord after weeks of acrimony between the companies, signaling that the No. 4 U.S. defense contractor might increase its offer.

TRW had called Northrop's $53-a-share offer inadequate and proposed its own plan to separate its automotive business from the defense unit to increase shareholder value. The company's shares rose 24 cents to close at $55.05 yesterday.

Northrop shares rose $2.14 to $121.61. The Los Angeles company would assume about $5.5 billion in TRW debt under its takeover proposal.

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