Takeover wars involving two Washington area companies heated up yesterday.
In one battle, Aristar Inc. of Miami raised its tender offer for shares of Silver Spring-based American Finance System.
The second confrontation was between Martin Marietta Corp. of Bethesda and BOC International of London for control of Airco Inc., an industrial gas producer in Montvale, N.J.
American Finance, a consumer finance holding company, earlier turned aside a bid by Aristar for its common stock at $9.50 a share. Yesterday, Aristar increased its offer to $11 a share for up to 2.3 million shares, or 47 percent of AFS common.
In the meantime, however, AFS directors have approved a merger into Security Pacific Corp., a large bank holding company based in Los Angeles. The AFS-Security merger would be accomplished through a tax-free exchange of stock valued at $10 a share and is scheduled to come up for a vote at the AFS annual meeting here on May 24.
AFS has sued to stop the Aristar cash offering and has asked the Virginia State Corporation Commission to dismiss the Aristar bid to buy indirect control of an AFS subsidiary in that state. A financial services and home furnishings firm, Aristar is controlled by Gamble-Skogmo Inc., a hardware retail chain.
In a statement yesterday, American Finance said it will take the new Aristar cash offer "under advisement" and make its position known later.
More complex is the struggle for control of Airco, whose board yesterday approved a plan to merge into Martin Marietta, a diversified aerospace, aluminum, chemicals and construction materials firm.
Although BOC International Ltd. owns a majority of Airco shares, 10 directors of Airco not allied with BOC ignored the London firm's objections and approved a letter of understanding with Martin Marietta.
BOC with three board members, tried to block the decision by changing the Airco bylaws to require unanimous decisions by the board.
Under the agreement reached yesterday, Martin Marietta would pay $50 in cash for each share of Airco. BOC now owns 54 percent of Airco's 12.3 million shares, but Airco is challenging BOC's purchase of 1.8 million shares. If the suit is successful, BOC no longer would have a majority ownership and Airco management could be successful in arranging the merger with Martin Marietta.
BOC is offering $43 a share for the remaining shares of Airco - a price Airco has said is too low. If the $50-a-share Martin Marietta exchange is accomplished, Airco would become a subsidiary of the Bethesda company. Airco plans a meeting of stockholders in May to consider the proposed merger.
Martin Marietta said it has commitments in principle from its banks for a line of credit, on a multiyear basis, adequate to complete the proposed acquisition. Depending on shares tendered, the merger bid could cost several hundred million dollars.