Marathon Oil Co., searching for a merger partner to rescue it from Mobil Corp.'s proposed $5.1 billion takeover, approached Standard Oil Co. of California but was rejected, Socal officials confirmed yesterday.
Socal said it was not interested in seeking control of Marathon because it did not fit into the company's strategy of exploring for oil, rather than buying it through takeovers.
Pennzoil Co. officials also confirmed that they rejected more than a month ago a request by a group of Marathon shareholders to consider bidding for control of Marathon. "What they were talking about wasn't of interest," said Baine P. Kerr, Pennzoil's president.
Texaco Inc. and Gulf Oil Corp., two other oil giants that some Wall Street analysts believe might be interested in bidding for Marathon, said yesterday they would not comment on Marathon.
Meanwhile, U.S. District Court Judge John M. Manos scheduled a hearing for Nov. 17 in Cleveland on Marathon's request for a preliminary injunction to stop Mobil from going forward with its tender offer for a controlling interest in Marathon. Marathon's suit alleges that a combination of the two companies would violate the antitrust laws by reducing competition in the oil business.
A week ago today, Mobil, the nation's second-largest oil company, announced a $3.4 billion tender offer to buy as many as 40 million shares, or 67 percent, of 16th-ranked Marathon for $85 a share. Mobil also has said it intends to acquire shares beyond the 40 million in a securities trade, which would take the cost of the entire package to $5.1 billion. Marathon's stock was being traded at $67.13 a share on the New York Stock Exchange before trading was halted after Mobil's announcement.
Mobil has been barred from taking any action to implement its bid for control of Marathon by a temporary restraining order imposed Sunday night in Cleveland by U.S. District Judge Frank J. Battisti. Marathon is based in Findlay, Ohio.
On Tuesday, Battisti rejected a request from Mobil to lift the restraining order on grounds that "serious" antitrust questions about the acquisition had been raised. Without the order, he ruled, Marathon and its shareholders would suffer "irreparable harm which would outweigh any potential damage" to Mobil.
Battisti did motify his earlier order somewhat to prevent officials of both Mobil and Marathon, and their agents, from issuing any press releases or other public announcements on the tender offer except for those required by law or court order.
Mobil's bid for Marathon is the second one it made in three months. In August, Mobil lost a bidding war for Conoco Inc., the nation's ninth-largest oil company.
Marathon's largest shareholder--with about 7 percent of the stock--is Sedco Inc., an offshore drilling contractor based in Dallas. Bass Brothers Enterprises Inc., with a 5.1 percent interest, is Marathon's second-largest shareholder.