Takeover

E*Trade Financial Corp. Shares climbed $1.07 to close at $5.33. The struggling online brokerage is trying to negotiate a takeover or partial sale to a rival, according to media reports.

No. 3 steelmaker Bethlehem Steel Corp. boosted the potency yesterday of its "poison pill," a shareholder-rights plan that helps guard against hostile takeovers by making it prohibitively expensive for an unwanted suitor to amass a big stake in the company.The change comes a week after WHX Corp., the parent of Wheeling-Pittsburgh Steel Corp., disclosed that it held 1.6 percent of Bethlehem's stock and filed documents with securities regulators signaling its intent to pursue a takeover or merger.

Mercantile Bankshares Corp. said yesterday that it is boosting its quarterly dividend 9 percent, and adopting a new anti-takeover plan.Directors of the state's largest independently owned banking company, which has $7.6 billion in assets, voted to raise the dividend by 2 cents to 24 cents a share payable June 30 to stockholders of record June 18.The increase marks the 23rd consecutive year of dividend increases at the Baltimore-based banking company."

The state Senate yesterday approved the Glendening administration's proposal to help Maryland-based corporations resist hostile takeovers.Senators passed the anti-takeover bill, 38-9, without debate. The measure, which also applies to real estate investment trusts, now goes to the House of Delegates, where its fate is less certain.Business and economic development officials have said that without new legal defenses, Maryland-based corporations and REITs could be gobbled up by takeover "sharks" brandishing tender offers to their shareholders.

The Glendening administration's proposal to strengthen Maryland laws discouraging hostile corporate takeovers won broad support yesterday in Annapolis.Spokesmen for the administration and for business and lawyers' groups told the House Economic Matters Committee that, without new legal defenses, Maryland-based corporations and real estate investment trusts could be gobbled up by takeover "sharks" or "raiders.""We have seen many well-known Maryland companies disappear," said Richard C. Mike Lewin, state business and economic development secretary.

NEW YORK -- The Dow Jones industrial average rose 4.73 points to 8,550.45 yesterday, but U.S. stocks were mixed as a string of takeover bids was offset by concern that rising bond yields may crimp corporate profits and lessen demand for equity mutual funds.J. P. Morgan & Co. led the Dow's advance, as the 30-stock average eked out a fourth straight record. Morgan's shares rose $4.0625 to $123.5625. The bank's chief executive told employees last week that it was willing to consider a merger.

EVEN AFTER Tuesday's public auction of $140,000 in assets of the bankrupt Columbus Center, Baltimore and the state stand to lose $6 million in the proposed state takeover. Nevertheless, the deal benefits taxpayers.This way, the Inner Harbor research complex, which opened with high hopes and great fanfare in 1995, at least will retain some of its promise as a showcase for breakthroughs in marine biology. Once the deal clears the legal hurdles, the University System of Maryland, which will control the landmark building, must fulfill two goals:1)

Marriott International Inc. backed down yesterday from a measure that linked a popular merger proposal with a controversial anti-takeover scheme, declaring that shareholders will be allowed to vote separately on the takeover issue.Anxious to complete its proposed restructuring and merger with Sodexho Alliance S.A., Marriott promised to repeal the takeover rule and a measure to create two stock classes unless shareholders approve them at a meeting in May.That led two prominent stockholder advisory firms to drop their opposition to the Sodexho merger and related restructuring, which will be considered at a postponed shareholders meeting on Friday.

Marriott International Inc. is drawing fire for linking a midmonth shareholder vote on a planned merger with provisions that would likely cement Marriott family control over the Bethesda-based lodging giant.The criticism stems from material contained in a recent Marriott proxy statement filed in conjunction with its planned merger with Sodexho Alliance S.A. In the proxy, Marriott says it intends to issue a new class of voting stock that will subordinate the company's existing common stock.

Making what could be a last-ditch effort to repair his fractured relationship with Baltimore Mayor Kurt L. Schmoke, Gov. Parris N. Glendening said last night he supports the mayor's proposal to have the state take over the cost of the circuit courts across Maryland.The governor's statement came hours after Schmoke, in his first public comments on the matter, said a state court takeover would appeal to Baltimore residents because it would allow the city to commit about $9 million in additional spending to public safety.

Constellation Energy Group Inc. will lay off as much as 8 percent of its work force, or more than 800 people, mostly from the commodities trading division that propelled the company to the brink of bankruptcy this year and forced it into a proposed takeover, company officials said yesterday. About half the job cuts will be in the Baltimore area. In a memo to employees, Constellation Chief Executive Officer Mayo A. Shattuck blamed deteriorating financial markets and "the near certainty of a prolonged and deep economic recession" for making the cuts necessary.

GEORGE KELLER, 84 Former Chevron chairman George Keller, who oversaw the formation of Chevron Corp. in what was then the largest corporate takeover, died Friday in Palo Alto, Calif. The former chairman and chief executive died of complications from orthopedic surgery. As chairman of the Standard Oil Co. of California, Mr. Keller executed the company's $13.3 billion takeover of Gulf Oil to form Chevron in 1984. The deal was considered risky at the time.

Two months after an Indiana competitor spent millions acquiring a big chunk of Tessco Technologies Inc., the Hunt Valley company has struck back with a defensive move designed to shield it from a hostile takeover. In documents filed yesterday with the Securities and Exchange Commission, Tessco outlined a stockholder "rights plan" that would allow shareholders as of Feb. 11 to buy a certain amount of stock at half price if anyone tries to obtain 20 percent of the business. The proposal would make it more difficult and expensive to acquire the company, which makes products for operating and using wireless systems.

E*Trade Financial Corp. Shares climbed $1.07 to close at $5.33. The struggling online brokerage is trying to negotiate a takeover or partial sale to a rival, according to media reports.

WORLD Iran moderate resigns post In a major setback to Iranian moderates, Iran's chief nuclear negotiator, Ali Larijani, who struggled fiercely against the uncompromising agenda of President Mahmoud Ahmadinejad, has resigned from his high-profile post. pg 19a Gaza smokers do without Skyrocketing prices - a result of Israel's economic sanctions against Gaza after the Hamas takeover - have pushed cigarettes out of the reach of many smokers. They've quit or cut back, cursing Israel for keeping most cigarettes out and Hamas for taxing whatever gets through.

ATLANTA -- US Airways handed Delta Air Lines an unexpected gift when it launched a surprise takeover bid three months ago. After years of morale-sapping cutbacks, Delta had a common enemy that united and revved up the work force. The challenge for Delta will be keeping up the momentum now that the takeover battle is won. "You can tell when all your people, including your pilots and ... everybody else is exactly on the same page. There is huge strength in that," said Delta chief executive Gerald Grinstein.

Steel magnate Lakshmi N. Mittal tightened his grip on the world's largest steelmaker yesterday, becoming chief executive officer of Arcelor Mittal three months after he engineered a stunning takeover of his biggest rival. Mittal was to share leadership responsibilities of the combined company with Roland Junck, his counterpart at Arcelor, largely in an effort to smooth resentment from the protracted fight over the $38 billion merger. In August, after the merger was approved by shareholders, Mittal was named president of the board of directors and Junck CEO. Arcelor Mittal owns the Sparrows Point steel mill and controls 10 percent of the world's steel production, topping 110 million tons per year.

The federal government is investigating the takeover last year of a leading American manufacturer of electronic voting systems by a small software company that has been linked to the leftist government of President Hugo Chavez of Venezuela. The federal inquiry is focusing on the Venezuelan owners of the software company, the Smartmatic Corp., and is trying to determine whether the government in Caracas has any control or influence over the firm's operations, government officials and others familiar with the investigation said.

The future of the Sparrows Point steel mill could hinge on the outcome of a tug of war between its owner, Mittal Steel Co. of London, and Luxembourg-based Arcelor SA, which agreed Sunday to merge, forming the world's largest steelmaker. The $31.9 billion deal ends Mittal's five-month pursuit of Arcelor, which fiercely resisted a takeover by what its chief executive referred to as a producer of cheap cologne compared with Arcelor's perfume. The new steel giant, to be called Arcelor-Mittal, would control nearly 10 percent of world steel production, churning out 120 million tons of crude steel a year and employing more than 320,000.

PARIS -- Arcelor announced plans yesterday to create the world's biggest steelmaker by merging with a Russian steel company controlled by the billionaire Alexei Mordashov, the latest in a series of high-stakes efforts to repel a hostile takeover bid from Arcelor's archrival, Mittal Steel. Mordashov would become Arcelor's largest shareholder by paying cash and stock in his company, Severstal, for 32 percent of Arcelor. Mordashov also is offering a stake in all of Severstal's steel assets and an Italian steelmaker, Lucchini.