ITT EXPECTED TO TELL HILTON: DO NOT DISTURB.Byline: Kenneth N. Gilpin The New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Times ITT ITT Initial Teacher Training (UK) ITT I Think That ITT Invitation To Tender ITT Individual Time Trial (professional cycling) ITT Intention-To-Treat ITT In This Thread (forums) , the recipient of an unsolicited $6.5 billion takeover offer from Hilton Hotels
Moreover, ITT Corp., which in its current form has been in operation for slightly more than a year, has at its disposal a range of options that could allow it to remain independent. The biggest obstacle in Hilton's way is a so-called poison pill A defensive strategy based on issuing special stock that is used to deter aggressors in corporate takeover attempts. The poison pill is a defensive strategy used against corporate takeovers. provision, in place since November 1995, that would be set off should a potential acquirer buy or announce an intention to buy more than 15 percent of ITT's outstanding shares. In addition, ITT may consider the purchase of another hotel or gaming company, and conceivably could even make an offer for Hilton, analysts said. ``I don't think they want to sell,'' said Joseph Coccimiglio, an analyst with Prudential Securities. ``They want to remain independent and have a plan to grow the company for shareholders.'' ITT would be expected to oppose a takeover offer, analysts said, if for no reason other than that Rand V. Araskog, ITT chairman and chief executive, and his management team have spent so much time and effort remaking ITT from a disjointed conglomerate into the gaming and lodging company it is today. Still, ITT has not decided to reject the offer. A spokesman for the company said again Tuesday that ITT's board would take as long as 10 business days to consider an offer once it is formally made. ``Management and the board have a fiduciary responsibility to carefully and deliberately examine the Hilton offer at the appropriate time,'' said James Gallagher Several notable people have been named James Gallagher:
In a conference call with analysts Tuesday, Stephen Bollenbach Stephen F. Bollenbach has been the Co-Chairman and Chief Executive Officer of Hilton Hotels Corporation since February 1996. Bollenbach graduated from the University of California, Los Angeles. External link
tr.v. de·ac·ti·vat·ed, de·ac·ti·vat·ing, de·ac·ti·vates 1. To render inactive or ineffective. 2. To inhibit, block, or disrupt the action of (an enzyme or other biological agent). 3. the poison-pill provision. Hilton sued ITT on Tuesday in a Nevada court, seeking to dismantle the provision. The poison pill may just be one weapon available to ITT. A counteroffer In contract law, a proposal made in response to an original offer modifying its terms, but which has the legal effect of rejecting it. A counteroffer normally terminates the original offer, but the original offer remains open for acceptance if the counteroffer expressly by ITT for Hilton is a real possibility, analysts said. ``In terms of cash flow, ITT and Hilton are fairly close to the same size,'' said Coccimiglio, the Prudential analyst. ``But if ITT wants to maintain its investment-grade debt rating, their offer could not include much debt.'' ITT is carrying about $4.2 billion in debt. Hilton, which has offered $55 a share in cash and debt for the company, also would assume ITT's debt. CAPTION(S): Photo Photo: (Color) ITT, Sheraton Hotels owner, may not be open to a Hilton takeover, analysts say. Associated Press |
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