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Gold/Mining/Energy : Tusk Energy (TKE) -- Ignore unavailable to you. Want to Upgrade?

To: Robert McCullough who wrote (1012)	12/5/1998 7:40:00 PM
From: Robert McCullough	Respond to of 1207

Memo: Looks a lot like the 'Wave of the Near Future' Bob... Megamergers may just be starting By ERIC QUINONES NEW YORK (AP) - A few years ago, a merger of Exxon and Mobil might have seemed as unlikely as, say, a professional wrestler being elected governor. Now, eye-popping mergers of giant corporate rivals are commonplace. But to anyone who fears a handful of companies will take over the world, business experts say global competition is just too strong. "As big as companies might seem today, actually the large companies are a smaller fraction of the market than they were 20 and 30 years ago," said Jeremy Siegel, professor of finance of the University of Pennsylvania's Wharton School of Business. The quest for size and global reach has been accompanied by a focus on efficiency and cost-cutting as giant rivals combine and then slash their overlapping businesses and employees. The oil industry, in particular, has seen huge mergers as companies look to slash costs and boost profits amid a deep global slump in prices. Financial institutions are combining in efforts to provide a broad new array of services, from chequing accounts to insurance and investment advice. The result has been an array of mergers creating headlines as startling as Minnesota Gov. Jesse (The Body) Ventura: between Exxon and Mobil, Daimler-Benz and Chrysler, America Online and Netscape Communications, Travelers and Citicorp, and NationsBank and BankAmerica. "I've long since gotten over the thought that any deal should be unthinkable," said Herald Ritch, co-head of mergers and acquisitions at Donaldson, Lufkin & Jenrette. Some companies are trying to restore past dominance. AT&T is the best example, as the former telephone monopoly has lost half its share of the long-distance market since being broken up by the U.S. government in 1984. AT&T is now trying furiously to crack the local phone business and is buying cable giant Tele-Communications Inc., planing to deliver phone and Internet services along with TV signals. While the combination of heavyweights might seem an unfair concentration of power, government regulators have determined that big deals do not necessarily create antitrust problems. For instance, NationsBank was allowed to buy BankAmerica, WorldCom bought MCI, Boeing bought McDonnell Douglas. But the watchdogs have forced some companies to sell off piece of themselves if they would dominate specific markets. Exxon and Mobil will probably have to sell service stations and refineries in regions where the combined company would dominate the market. In some cases, deals have been blocked. In the past year and a half, regulators quashed proposed mergers between office-products retailers Staples and Office Depot, defence giants Lockheed Martin and Northrop Grumman, and America's top four drug wholesalers. With Wall Street reviving and once again letting companies use high-priced stock as currency to acquire rivals, regulators will have to be prepared for a heavier onslaught. From electrical utilities to entertainment companies, merger watchers say the boom will continue as long as the stock market remains strong. And in the wake of deals such as Daimler-Chrylser, British Petroleum-Amoco and Deutsche Bank-Bankers Trust, big names will be coming together on a global scale. Henry Jacoby, a management professor at the Massachusetts Institute of Technology, points to Rupert Murdoch's News Corp. media conglomerate and auto giants General Motors and Ford as companies looking to strengthen their European operations. Says Jacoby: "Let your imagination run." © The Canadian Press, 1998