Takeover

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.

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.

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 directors of TRW Inc. urged shareholders to reject Northrop Grumman Corp.'s latest takeover bid yesterday, calling the $53-per-share offer "financially inadequate." The move came on the same day that both companies released solid quarterly earnings reports, adding fuel to a hostile takeover effort that is headed for a showdown early next week. TRW shareholders are scheduled to vote April 22 whether to share confidential financial information with Northrop Grumman and begin intensive negotiations for a takeover.

WASHINGTON -- Hilton Hotels Corp., which proposed in January a hostile takeover of ITT Corp., has asked a federal court to block ITT from its plan to break into three companies.The ITT plan ignores the interests of shareholders, who should be allowed to vote on the spinoffs, Hilton said.ITT announced the plan last month as part of its strategy to thwart Hilton's takeover bid. If carried out, the plan would make the assets harder for Hilton to acquire.Beverly Hills, Calif.-based Hilton put the fate of its $70-a-share bid for ITT in the court's hands Monday, saying it won't pursue the $11.5 billion takeover if it fails to block ITT's plan to break up, buy back a quarter of its shares and take on $2 billion of new debt.

The Greater Baltimore Committee favors a state takeover of Baltimore schools, unless major improvements are made in the next few years.The business group outlined its views to the state school board yesterday, part of an overall briefing on education.The GBC stance reflects the business community's impatience with the pace of school reforms in Baltimore, said Bob Keller, president of the group."There's got to be fundamental radical reform, and is that happening? Certainly not to our satisfaction," said Keller, speaking after the briefing.

WILMINGTON, Del. - Former PeopleSoft Chief Executive Officer Craig Conway testified yesterday that he may have overreacted to Oracle Corp.'s $7.7 billion hostile bid by attacking its founder, Larry Ellison. Conway, who described Ellison as "sociopathic" after the June 2003 bid, told a Delaware Chancery Court judge that he decided to vilify Oracle and Ellison as part of an effort to fend off the offer, now valued at $21 a share. Oracle is suing People- Soft, seeking to knock out the company's takeover defenses.

Northrop Grumman Corp. said yesterday it is launching a hostile bid to acquire TRW Inc. for $5.9 billion, after TRW's board rejected earlier in the day an unsolicited offer made 10 days ago. Northrop said it will take its bid directly to the shareholders by filing a tender offer for TRW with the Securities and Exchange Commission today. Northrop has been preparing for such a hostile bid, anticipating a rejection by Cleveland-based TRW. Northrop, a Los Angeles-based defense contractor that has grown to become an industry powerhouse, proposed a deal with TRW directors Feb. 21, just three days after TRW's chief executive abruptly resigned to take a top post at another aerospace company.

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)

CHICAGO - Quaker Oats Co. shares rose 9 percent yesterday on expectations that the company will receive more takeover offers, after published reports said the maker of Gatorade rejected a $14 billion bid from PepsiCo Inc. While either PepsiCo or rival Coca-Cola Co. could use its marketing muscle to boost sales of Gatorade, some analysts identified Nestle SA as a more likely buyer because of its interest in Quaker's foods. Quaker's other products range from oatmeal to Cap'n Crunch cereal to Aunt Jemima syrup.