AT&T; Won’t Raise NCR Bid; Showdown Is Today
American Telephone & Telegraph said late Wednesday that it refused NCR Corp.’s last-minute request for a sweetened $110-per-share price to settle their hostile takeover battle, setting the stage for a showdown at today’s NCR shareholder meeting.
A final round of negotiations between the two companies began at NCR’s request Wednesday afternoon, less than a day before NCR shareholders were scheduled to vote on AT&T;’s bid of $100 per share for the nation’s fifth-largest computer maker.
However, after several hours of discussions between financial advisers to both companies, AT&T; turned down NCR’s request.
AT&T; officials declined to say whether talks were continuing between the two companies. NCR officials declined to comment.
The negotiations resumed Wednesday amid widespread belief on Wall Street that both companies would be better off reaching a settlement rather than take the matter to NCR shareholders. Several analysts said the shareholder vote was unlikely to produce a clear-cut victory for either side.
At today’s meeting, NCR stockholders will vote on AT&T;’s proposal to replace the entire NCR board with a slate of candidates favorable to the telecommunication firm’s $100-per-share offer.
However, most analysts doubted that AT&T; could muster the 80% shareholder support necessary to oust the entire board, leaving the company to pursue a legal challenge to NCR’s takeover defenses or to seek another shareholder vote. AT&T; has repeatedly said that it wants NCR to bolster AT&T;’s sagging efforts to enter the emerging markets for data communications and computer networking services and products.
AT&T; Chairman Robert E. Allen and NCR Chairman Charles E. Exley Jr. made it clear earlier this week that price was the only issue delaying any agreement.
AT&T;’s offer of $100 per share, or $6.8 billion, is contingent on the negotiation of a friendly merger agreement or the ousting of NCR’s entire board. Otherwise, AT&T; has said it would pay $90 per share.
AT&T;, NCR CHRONOLOGY Here are key dates in American Telephone & Telegraph Co.’s effort to acquire NCR Corp., leading up to a special NCR shareholders meeting today:
Nov. 15, 1990: AT&T; makes private overture to NCR about a negotiated takeover in which it would swap $85 in AT&T; stock for each NCR share.
Dec. 5: NCR Chairman Charles E. Exley Jr. tells AT&T; his company remains opposed to a takeover but would enter into negotiations if AT&T; raised the price to $125 a share, or $8.5 billion. AT&T; announces a $90-a-share, $6.1-billion cash tender offer directly to NCR shareholders, effective Dec. 6.
Jan. 16, 1991: AT&T; says it has received requests from a majority of NCR stockholders asking the company to call the special meeting.
Feb. 21: NCR adopts an employee stock ownership plan, which would allow employees to vote an additional 8% of NCR stock at the shareholders meeting.
March 19: A federal judge in Dayton, Ohio, invalidates the employee stock plan. AT&T; says it will increase its tender offer to $100 a share in cash if NCR shareholders replace the entire NCR board at the special meeting.
March 24: NCR’s board authorizes Exley to discuss a merger with AT&T; at above $100 a share.
March 25: Exley and AT&T; Chairman Robert E. Allen meet.
March 27: Both firms resume last-minute talks, one day before the shareholders meeting is scheduled in Dayton, NCR’s base.
