Bendix Chairman William M. Agee today lauded mergers as crucial to the growth of American industry and said that he will have failed as a manager if the Bendix -- Martin Marietta takeover controversy leads to limits on corporate mergers.
"There's nothing at all wrong with the right kind of mergers," Agee said during a conference here. "Don't let people come along and say mergers are bad per se. If that's one of the end results that come out of this, then we as managers and people will have let the country down.
"Many of the fine companies in this country have arrived at where they are because of mergers and acquisitions intelligently done where there is real value added," he said. Mergers "create more jobs, create better research, create a more efficient America, he said, responding to criticism from Wall Street to Congress that the Bendix takeover attempt represented a billion-dollar waste of company assets.
"Let us not fall into a situation where the world generalizes from this experience, saying all mergers and acquisitions are wrong. If we ever got to that stage, our world competitive situation will become worse than it is today."
Agee's defense of mergers came in his first public appearance since the conclusion 10 days ago of the ballyhooed merger struggle he triggered with his unsuccessful attempt to take over Martin Marietta Corp. He spoke at a conference on corporate restructuring sponsored by Oppenheimer & Co. Inc. and was clearly using the forum to speak to Wall Street about his reasons for launching the stuggle that ended with Bendix falling under the control of Allied Corp. and Agee becoming Allied's No. 2 executive.
"I know the conventional wisdom is that Bill Agee and Bendix lost," he added. "I don't believe that's the case, but only history will judge."
Agee, who got warm applause at the conclusion, also used the meeting as a setting to chide other managers of American business for not moving quickly away from faltering enterprises. "One of the things that's wrong with American business is that we do not have enough managers running businesses when it comes to critical decisions, in terms of selling things, buying things, merging or whatever, who do a credible job of serving their shareholders," he said.
Although not contrite about his role in the saga, Agee said he learned to "never, ever overestimate the rationality of some of your foes," a clear reference to the unwillingness of Martin Marietta management to consider negotiating Bendix's takeover bid.
Agee emphasized that, in his view, the "shareholder value" in his company has increased as a result of the battle and also noted that Bendix was not broken in the aftermath of Allied's ultimate takeover. "My principal motivation at the time was to enhance the value of the entity [for which] I have fiduciary responsibility," he said.
In addition, he rejected suggestions that Bendix and Martin Marietta would not have fit well together, had they ultimately been brought together. "It was not a wild off-the-wall, unsynergistic situation," he said.
He said repeatedly that he was willing to negotiate any piece of the Bendix bid for Martin Marietta. "I was prepared through the last day to negotiate any and all of the terms," he insisted, noting that, in his mind, Bendix's willingness to negotiate virtually every aspect of the takeover made his offer to Martin Marietta a "friendly" bid. "Unsolicited yes. But everything about my intentions and putting these companies together was totally friendly," he said.
In terms of public policy, Agee said two-tiered tender bids -- offers with higher prices for shareholders who submit their holdings in a company earliest, and lower prices for those who don't sell immediately -- ought to be prohibited either by legislation or regulation. "Back-end shareholders have been hosed" on such transactions, he said, referring to the late-comers.
Furthermore, he was bitterly critical of corporations who pull apart their companies in order to fend off unfriendly takeovers. "The penalty long term is not worth the price," Agee said.