Special Feature, 12/17/98: The 1998 Year In Review, Timeline

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'98 Year In Review
December 17, 1998

Second Quarter 1998

by Yi-Hsin Chang (TMF Puck)

April

06... In the largest U.S. bank merger ever, Citicorp and Travelers Group agree to combine to create a universal bank called Citigroup <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: C)") else Response.Write("(NYSE: C)") end if %> that is involved in consumer financial services, corporate and investment banking, asset management, and insurance.

07... Health and life insurer Conseco Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CNC)") else Response.Write("(NYSE: CNC)") end if %> announces it will buy manufactured home mortgage and specialty finance company Green Tree Financial Corp. in a stock swap valued at $7.6 billion.

Consumer finance company Household International <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HI)") else Response.Write("(NYSE: HI)") end if %> says it will acquire Beneficial Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BNL)") else Response.Write("(NYSE: BNL)") end if %> in a pooling-of-interests transaction valued at $150 per Beneficial share, or a total of more than $8.6 billion.

09... K-tel <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: KTEL)") else Response.Write("(Nasdaq: KTEL)") end if %> announces plans to enter the e-commerce market by selling music online. Internet fever sends its shares up from $3 3/8 to nearly $34, on a split-adjusted basis, and then down again to the single-digit range by late July.

13... NationsBank and BankAmerica <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BAC)") else Response.Write("(NYSE: BAC)") end if %> announce a "merger of equals," though NationsBank shareholders will own about 55% of the combined entity. With $572 billion in assets, the new company will take the name of BankAmerica, but will be based in NationsBank headquarters in Charlotte and headed by NationsBank Chairman and CEO Hugh McColl.

15... Cendant <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CD)") else Response.Write("(NYSE: CD)") end if %> discloses it has uncovered accounting "irregularities" at its CUC International divisions and will have to significantly restate 1997 and 1998 earnings. By July, the company admits that 30% to 40% of CUC's 1997 earnings were fraudulent, while 10% to 20% were genuine accounting errors.

22... Bank of New York <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BK)") else Response.Write("(NYSE: BK)") end if %> makes an unsolicited offer to buy Pittsburgh-based Mellon Bank <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MEL)") else Response.Write("(NYSE: MEL)") end if %> for about $90 a share in stock, a deal Mellon promptly rejects. Bank of New York eventually withdraws the offer after Mellon executives refuse to even meet with BONY executives.

May

04... After three months of delaying tactics, court challenges, and legislative maneuvering designed to forestall a hostile takeover by SPX Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SPW)") else Response.Write("(NYSE: SPW)") end if %>, auto parts maker Echlin agrees to be acquired by auto parts giant Dana Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DCN)") else Response.Write("(NYSE: DCN)") end if %> in a stock swap valued at close to $3.6 billion.

07... In the largest ever industrial merger, valued at $92 billion, Chrysler and Daimler-Benz <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DAI)") else Response.Write("(NYSE: DAI)") end if %> announce they will combine to form DaimlerChrysler in a "merger of equals." Daimler shareholders will end up owning just under 60% of the new company, which will be incorporated in Germany, with operational headquarters in Stuttgart, Germany, and Auburn Hills, Michigan.

08... Foot Locker and Champs Sports parent Venator Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: Z)") else Response.Write("(NYSE: Z)") end if %>, formerly known as Woolworth, announces it will acquire The Sports Authority <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TSA)") else Response.Write("(NYSE: TSA)") end if %> in a stock swap valued at $570 million. But Venator ends up having to bag the deal in September after its share price plunges 63%.

11... Having digested its huge merger with Pacific Telesis, or PacBell, and earlier announcing a deal to acquire Southern New England Telecom, SBC Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SBC)") else Response.Write("(NYSE: SBC)") end if %>, the former Southwestern Bell, says it will buy Chicago-based Baby Bell Ameritech <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AIT)") else Response.Write("(NYSE: AIT)") end if %> for $62 billion in stock.

Chemicals and life sciences company DuPont <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DD)") else Response.Write("(NYSE: DD)") end if %> says it will divest itself of its Conoco <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: COC)") else Response.Write("(NYSE: COC)") end if %> oil production and refining unit, starting with an initial public offering of about 30% of Conoco's shares in late October. DuPont is able to sell $4.4 billion in shares, making it the largest U.S. IPO this decade.

18... The U.S. Justice Department and the attorneys general of 20 states and the District of Columbia file antitrust charges against Microsoft <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MSFT)") else Response.Write("(Nasdaq: MSFT)") end if %>, alleging that the software giant "illegally stifled competition, harmed consumers, and undercut innovation in the computer software industry."

19... Landover, Maryland-based supermarket chain Giant Food <% if gsSubBrand = "aolsnapshot" then Response.Write("(AMEX: GFS.A)") else Response.Write("(AMEX: GFS.A)") end if %> says it has agreed to be acquired by Royal Ahold <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AHO)") else Response.Write("(NYSE: AHO)") end if %>, making the Dutch food retailer one of the top five grocery store operators in the U.S.

21... Beverage and entertainment company Seagram Ltd. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: VO)") else Response.Write("(NYSE: VO)") end if %> agrees to buy music company PolyGram NV <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PLG)") else Response.Write("(NYSE: PLG)") end if %> for $10.5 billion in cash and stock, extending its music presence. The surprise, however, is that Seagram plans to sell its Tropicana orange juice division, the dominant player in the world of O.J.

26... Diversified manufacturing and service company Tyco International <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TYC)") else Response.Write("(NYSE: TYC)") end if %> announces the acquisition of U.S. Surgical <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: USS)") else Response.Write("(NYSE: USS)") end if %> for $3.3 billion in stock. Already the world leader in security and fire protection systems, Tyco will now become one of the largest manufacturers of disposable medical products with $4.5 billion in annual medical product sales as well as total annual revenue in excess of $15 billion.

28... Managed care provider United HealthCare <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: UNH)") else Response.Write("(NYSE: UNH)") end if %> says it will acquire health maintenance organization Humana Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HUM)") else Response.Write("(NYSE: HUM)") end if %> in a stock swap valued at roughly $6.3 billion.

June

08... Wells Fargo <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: WFC)") else Response.Write("(NYSE: WFC)") end if %> ends a year of speculation by announcing it will merge with Norwest Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: NOB)") else Response.Write("(NYSE: NOB)") end if %> in a deal valuing Wells Fargo at $36 billion.

09... General Electric's <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GE)") else Response.Write("(NYSE: GE)") end if %> NBC television network says it will buy a 5% interest in Internet content provider CNET Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CNWK)") else Response.Write("(Nasdaq: CNWK)") end if %> and a 19% stake in CNET's Snap! Internet portal and search service with an option to raise that stake to 60%. CNET and NBC will operate Snap! as a joint venture and might eventually take the unit public.

15... Sunbeam Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SOC)") else Response.Write("(NYSE: SOC)") end if %> axes its chairman and CEO, "Chainsaw" Al Dunlap. Sunbeam has been under fire since earlier announcing the acquisition of Coleman Brands and two other companies, and since the company has had to downwardly revise numerous quarterly earnings expectations.

Networking products company Bay Networks agrees to be acquired by telecom equipment company Northern Telecom <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: NT)") else Response.Write("(NYSE: NT)") end if %> in an all-stock deal valued at about $9.1 billion.

18... Walt Disney Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DIS)") else Response.Write("(NYSE: DIS)") end if %> announces it will take a 43% stake in Infoseek <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SEEK)") else Response.Write("(Nasdaq: SEEK)") end if %> in exchange for $70 million in cash and the majority stake Disney owns in website design company Starwave Corp. Disney also will purchase warrants that would guarantee a strike price at a 20% premium to Infoseek's stock price and would give the media and entertainment giant a majority stake in the Internet company.

19... Warren Buffett's Berkshire Hathaway <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BRK.A and BRK.B)") else Response.Write("(NYSE: BRK.A and BRK.B)") end if %> says it will acquire reinsurer General Re Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GRN)") else Response.Write("(NYSE: GRN)") end if %> for $22 billion in Berkshire Class A or Class B shares.

22... Radio Shack parent Tandy Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TAN)") else Response.Write("(NYSE: TAN)") end if %> agrees to sell its lagging Computer City subsidiary to computer products retailer CompUSA Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CPU)") else Response.Write("(NYSE: CPU)") end if %> for around $275 million in a note and cash.

24... AT&T <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: T)") else Response.Write("(NYSE: T)") end if %> announces plans to acquire Tele-Communications Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TCOMA)") else Response.Write("(Nasdaq: TCOMA)") end if %> for $48 billion in AT&T stock. AT&T will create a new division, Consumer Services, which will combine its consumer long distance, wireless, and Internet services units with TCI's cable, telecommunications, and high-speed Internet businesses.

25... Microsoft <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MSFT)") else Response.Write("(Nasdaq: MSFT)") end if %> launches Windows 98, the latest version of the company's ubiquitous operating system. Many computer stores open at midnight and offer free copies of the software to the first customers in line as part of a massive promotional campaign to boost sales.

26... Gillette <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: G)") else Response.Write("(NYSE: G)") end if %> launches its much anticipated new Mach3 shaving system that it spent $750 million to develop. The company is billing the shaver as "the first and only shaving system with three progressively aligned blades" that is supposed to give men a closer shave in fewer strokes and with less irritation.

Next -- Third Quarter 1998