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Tuesday, December 1, 1998
"Those who cannot change their minds cannot change anything." -- George Bernard Shaw
Exxon to Acquire Mobil
Oil giant Exxon <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: XON)") else Response.Write("(NYSE: XON)") end if %> announced it has agreed to buy rival Mobil <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MOB)") else Response.Write("(NYSE: MOB)") end if %> for about $77.2 billion in stock and assumed debt. The $99-a-share price, based on Exxon's close yesterday of $75, represents a 15% premium to Mobil's closing price yesterday of $86 and a 32% premium to its $74 15/16 closing price last Wednesday, a day before the companies confirmed reports that they were in merger talks. Exxon shareholders will own about 70% of Exxon Mobil Corp., which will be the world's largest oil company, ahead of Royal Dutch/Shell Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: RD and NYSE: SC)") else Response.Write("(NYSE: RD and NYSE: SC)") end if %>, with annual revenue of $202 billion.
The combined oil company is expected to cut costs by more than $3 billion annually as it axes 12,000 jobs, or 10% of its current workforce. Mobil has outpaced Exxon in terms of exploration efforts, though it has been hard hit by the worldwide decline in oil prices. For the first nine months of this year, Mobil saw earnings drop 28% year over year, despite targets to increase operating earnings by 10% a year through 2001.
The Mobil acquisition would be the second oil megamerger this year -- in August, British Petroleum <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BP)") else Response.Write("(NYSE: BP)") end if %> announced plans to buy Amoco <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AN)") else Response.Write("(NYSE: AN)") end if %> for $64.3 billion in stock and debt. This morning, Paris-based Total SA, the world's ninth largest publicly traded oil concern, said it has agreed to acquire a 41% interest in Belgium refiner Petrofina SA <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: FIN)") else Response.Write("(NYSE: FIN)") end if %> for close to $13 billion, making the new company, Total Fina, the sixth largest in the world. Meanwhile, Shell and Texaco <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TX)") else Response.Write("(NYSE: TX)") end if %> yesterday ended talks, begun in September, to form a joint refining and marketing alliance in Europe, opening the door for possible deals with other oil companies.
News to Go
"Books, Music, and More" online retailer Amazon.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMZN)") else Response.Write("(Nasdaq: AMZN)") end if %> announced exclusive marketing deals with company information website Hoover's Online and Internet streaming media programmer Broadcast.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: BCST)") else Response.Write("(Nasdaq: BCST)") end if %>. Amazon will be the exclusive bookseller on Hoover's homepage, its 13,500 Company Capsules, its IPO Central, and its online store. Meanwhile, Amazon will also become Broadcast.com's exclusive book and music retailer.
Coffee roaster and retailer Starbucks <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SBUX)") else Response.Write("(Nasdaq: SBUX)") end if %> reported a 6% increase in November same-store sales, with total revenues rising 30% to $117 million from $91 million.
Biotechnology firm Organogenesis Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(AMEX: ORG)") else Response.Write("(AMEX: ORG)") end if %> will replace DeKalb Genetics <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DKB)") else Response.Write("(NYSE: DKB)") end if %> in the Standard & Poor's SmallCap 600 Index after today's close. DeKalb is being acquired by S&P 500 component Monsanto <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MTC)") else Response.Write("(NYSE: MTC)") end if %>.
Software developer Micro Focus Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MIFGY)") else Response.Write("(Nasdaq: MIFGY)") end if %> announced that company director and former CEO of Intersolv Gary Greenfield will replace Martin Waters as president and CEO, as the company reported fiscal third quarter earnings per American depositary share of $0.04 (before charges), down from $0.27 a year ago. Micro Focus acquired Intersolv in September. Under Greenfield's watch, Intersolv's annual revenues grew from $14 million to $196 million.
Twinlab Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TWLB)") else Response.Write("(Nasdaq: TWLB)") end if %> warned it expects fourth quarter revenues of $85 to $90 million, compared with $71.8 million in the same year-earlier period, and earnings of $0.23 to $0.26 a share, substantially short of analysts' mean estimate of $0.41. For the first quarter of next year, the nutritional products maker anticipates revenues and earnings will be "relatively flat" year over year. The company blamed excess inventories, slower growth in the nutritional supplement industry, and a delay in the rollout of its new Twinlab TruHerbs line.
Fiber optic telecommunications components and laser subsystems maker Uniphase <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: UNPH)") else Response.Write("(Nasdaq: UNPH)") end if %> announced it has acquired privately held Broadband Communications Products Inc. of Melbourne, Fla., a maker of fiber optic transmitters and receivers and test instrumentation for telecommunications equipment manufacturers, for about 730,000 shares and assumed options for an additional 418,000 Uniphase common shares.
Uniform rental services company Unitog Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: UTOG)") else Response.Write("(Nasdaq: UTOG)") end if %> said it has hired two investment banking firms to advise it on "strategic alternatives for enhancing shareholder value," including selling the company or merging with another company.
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Yi-Hsin Chang (TMF Puck), Writer
Jennifer Silber (TMF Amused), Editor
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