By vigorously playing the acquisition game over the past decade, Harry J. Gray, chairman of United Technologies Corp., has completely remodeled the nation's 20th-largest industrial company.
As a result, United's unique move today to acquire a major part of Bendix Corp. is not particularly surprising. What is startling is that the company is willing to plunge into the Bendix-Martin Marrietta Corp. takeover saga.
"They are a multi-industry company committed to increasing its size by acquisition," said Alan Benasuli, an analyst at Drexel Burnham Lambert Inc. "I'm sure they've looked at Bendix before this, but the timing is surprising."
Those who have watched Gray transform United from a company with a cyclical dependence on aerospace fields to a far broader company with assets including microelectronics, Carrier Corp. air conditioners, Otis Elevators and automotive engine components, generally praise his performance.
Moreover, having engineered a sevenfold increase in the size of United in just a decade, Gray is unlikely to duck a fight, observers indicated. "He is one of the smartest managers in business," said Eliot Fried of Shearson/American Express. Said another Wall Street professional: "Anytime Harry Gray can buy assets at a discount, he's not going to let go."
In recent years, Hartford, Conn.-based United has acquired Carrier for $1 billion and Mostek Corp., a major maker of electronic circuits, for $345 million. Those firms, along with Otis and other acquisitions, were added to the company's base -- the Pratt & Whitney engine business and Sikorsky helicopters.
In Gray's philosophy, as a corporation expands, it must find new pieces that complement and reinforce the old business operations -- rather that adding unrelated businesses merely to produce a more diversified company, a United official said.
"The strategy has paid off in strong performance," Gray proclaimed in a message included in the company's 1981 annual report, pointing to a 21 percent compound annual sales rise and an earnings-per-share jump of 20 percent over 10 years.
Despite the bravado, however, 1982 has not been a banner year. Sales fell by 2.5 percent for the first half, and second-quarter profits dropped 14 percent to $105 million. Benasuli estimated profits for the year equaling about $6.75 a share, down from $7.05 last year.
"They are having a tough year in aerospace, but they are doing fine," said Benasuli. "Their general aviation business is off by about 50 percent, and airplane engine profits at the company's Pratt & Whitney subsidiary are off about 40 percent."
While potentially adding Bendix's automotive, industrial and electronics businesses to the United fold, Gray, 63, also may have his eye on making Bendix chief William Agee his successor. "From the perspective of Gray, the idea of a very capable young tiger to add into the management structure would be pretty interesting," said Wolfgang Demisch, an analyst at Morgan Stanley & Co.
Gray had seemingly selected former secretary of State Alexander Haig as his heir apparent, but Haig left United last year to return to Washington after a year as the company's chief operating officer.
Gray joined United in 1961 as a group vice president and became president in 1971, chief executive officer in 1972, chairman and president in 1974 and chief operating officer last year. He had come to United from Litton Industries where he had last served as vice president.