Read Elsie’s Lips: Borden Not in Merger Talks

Borden Inc., the diversified dairy and consumer products company, said Wednesday that it was close to completing a restructuring and is not involved in talks about a sale or merger, as had been widely rumored.

The company’s stock had risen in recent days on market talk that it was in merger discussions with British-American conglomerate Hanson.

But Borden’s stock fell Wednesday after the company said it is not engaged in any talks. Borden dropped nearly 10% and closed $1.875 lower, at $17.25, on the New York Stock Exchange.

Borden said in a statement that over the last several months, the company’s directors and managers have reviewed “the full range of alternatives for Borden, including . . . sale or merger.”

But it added that “Borden is not currently engaged in discussions with third parties concerning the sale or merger of the company, and is not aware of anyone seeking to engage in such discussions.”

Borden said it will restructure its portfolio, operations and strategy, with details to be released in January.

Hanson has refused to comment on a published report that it was considering bidding perhaps $3 billion for Borden.

Nestle and Unilever are also among the companies rumored to be interested in acquiring Borden or some of its components, but neither would comment.

Speculation about sale of all or parts of Borden arose after the sudden ouster of Chairman and Chief Executive Anthony D’Amato on Dec. 9.

William Maguire, analyst at Merrill Lynch & Co., said investors generally prefer a quick sale and a well-defined bid, but now they are looking at “the hard bargaining of a company having to divest many divisions over several quarters.”

Borden owns about 50 food and plastics businesses in the United States and overseas. Its plight resembles that of other ailing mammoths whose chiefs have been pushed out for failing to move swiftly enough to reverse losses and restructure their companies.

Borden’s empire, from Elmer’s glue to Cracker Jack and other snack foods, has been declining across the board. Its third-quarter earnings were down in nearly every business area, and some analysts have said they see no improvement down the road.