Coniston Group Folds; Takeover Market Fades

Coniston Partners, one of the most prominent takeover strategists of the 1980s, said today it is disbanding because of the continued shrinkage of the mergers and acquisitions market.

The three partners who have led the investor group--Keith Gollust, Paul Tierney Jr. and Augustus Oliver--are disbanding their $700-million investment pool because of the scarcity of takeover financing and suitable target companies.

However, the three financiers said they plan to continue to seek investments and acquisitions. Without Coniston, their main investment fund, Gollust, Tierney and Oliver said they will finance their ventures on a case-by-case basis.

In its heyday, Coniston’s biggest targets included Gillette Co., Allegis Corp. and TW Services Inc.

The partnership failed in a 1988 attempt to take control of Gillette’s board, but it succeeded in forcing a 1987 restructuring at Allegis--which ultimately shed all of its assets except for United Airlines and renamed itself UAL Corp.--and took over TW last year.

The demise of Coniston marks the latest retreat of the 1980s corporate raiders following the collapse of the junk bond market last fall. The failure of the $6.7-billion buyout of Federated Department Stores Inc. by Campeau Corp. last September slowed takeover financing to a crawl and brought the merger boom to an end.

Although most of Coniston’s money will be returned to investors, the partnership will continue its investments in TW and UAL. Coniston is participating in a $4.38-billion plan by United Airlines employees to take their company private.

Gollust, Tierney and Oliver formed Coniston in 1982. The partnership typically took a large stake in a target firm and pressured management to take actions to increase the price of the company’s stock.