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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: 1-DAY-TRADER who wrote (13018)	8/20/1998 3:12:00 PM
From: Market Tracker	Respond to of 18691

AMP from yesterday's Reuters By Robin Sidel NEW YORK, Aug 19 (Reuters) - AMP Inc. <AMP.N> is expected this week to reject a $10 billion hostile bid from AlliedSignal Inc. <ALD.N> in favor of a internal plan aimed at jump-starting the struggling maker of electrical connection devices. The company, based in Harrisburg, Pa., is likely to tell shareholders that a restructuring announced in July provides more opportunities for the company than a takeover, Wall Street sources said Wednesday. "AMP is going to say no. I think the board is going to be quite unanimous," said William Milton of Brown Brothers Harriman. AMP is required to respond to AlliedSignal's $44.50 per share hostile tender offer by Friday. The bid was officially launched last week after AlliedSignal said AMP ignored friendly overtures. Shares of AMP fell 69 cents to $39.38 Wednesday on the New York Stock Exchange. Based in Morris Township, N.J., AlliedSignal is an industrial manufacturer seeking to expand in new high-growth businesses. In addition to the tender offer, it plans to seek control of AMP's board of directors and filed a lawsuit to invalidate AMP's "poison pill" anti-takeover plan. Although protected by Pennsylvania's tough anti-takeover laws, AMP is considered vulnerable because its stock price has been battered in recent months by earnings disappointments tied to exposure in volatile Asian markets. The stock, which traded in the mid-50s last fall, recently has slumped to the low-30s. In July, AMP announced plans to close facilities and lay off 7.5 percent of its workforce as part of a recovery plan. A rejection of the AlliedS ignal bid would likely set the stage for a protracted takeover battle and could force AMP to search for a "white knight", especially if its shareholders who are attracted to the hostile offer. But because AlliedSignal's bid already represents a significant premium to AMP's recent trading price, it is uncertain whether any effort to find another buyer would succeed. "Obviously, AMP would love to find a partner where they could be more in control of their own destiny," said James Meyer, an analyst at Janney Montgomery Scott Inc. AMP declined to comment on the expectations for its rejection. The company last week rejected an invitation to discuss the bid with Allied Signal, saying a meeting would be premature before its board evaluated the bid. Meanwhile, lobbyists for Allied Signal have been canvassing Pennsylvania legislators this week to familiarize them with the offer and the prospective buyer. "Allied Signal has made a public offer to acquire a company based in Pennsylvania. It's only appropriate that AlliedSignal should introduce itself to the leaders of the community," an AlliedSignal spokesman said. REUTERS Rtr 20:57 08-19-98