Bethlehem Steel Corp., the nation's second-largest steel maker, took defensive measures Thursday to prevent a hostile takeover by the parent of Wheeling-Pittsburgh Steel Corp.
Bethlehem Steel took aim at WHX Corp., which earlier this month amassed 2 million shares, or 1.6 percent of Bethlehem's stock. WHX, which is controlled by financier Ronald LaBow, also filed paperwork with federal antitrust regulators signaling a possible takeover or some other kind of deal.
To prevent WHX from accumulating more shares, Bethlehem lowered its poison-pill trigger to 5 percent for any company that does not yet own more than 5 percent of Bethlehem's shares, and has "made, or shall make, a filing under the Hart Scott Rodino Antitrust Improvements Act of 1976" -- which WHX has.
A poison pill, formally known as a shareholder rights plan, typically allows the shareholders of the target company to buy additional shares at reduced rates, thereby increasing the number of shares outstanding and making a hostile offer prohibitively expensive.
WHX spokesman Adam Miller declined comment on Bethlehem's move.
The entire U.S. steel industry has been hurt by imports from Asia, where cheap currencies, labor and raw materials have led to cutthroat prices.
While many analysts agree the U.S. industry may be on the mend, companies like Bethlehem have been badly hurt. The company lost $145 million during the first nine months of the year, and its stock has lost one-third of its value since April.
WHX might now be employing a "Pac Man offense," buying enough Bethlehem stock to be a pest and encouraging its larger rival to absorb WHX instead, said Charles Bradford, an industry analyst.
Bethlehem's spokesman Steve Donches said no business arrangements between the two companies are pending. He would not elaborate.
FedEx hiking rates 3 percent
MEMPHIS, Tenn. (AP) -- Federal Express Corp. said Thursday it will raise prices by 3 percent on most domestic and international shipments, joining a similar price hike by rival UPS.
FDX Corp., the parent of Federal Express, blamed rising fuel costs for the increase, which starts Feb. 1. Last month, the company said fuel prices contributed to a 6 percent decline in quarterly profits.
FedEx competitor United Parcel Service announced Wednesday that its shipping rates will increase Feb. 7. UPS commercial rates for air service will increase 3.5 percent while commercial rates for ground services will rise by 3.1 percent.
UPS said its rate increases were unconnected to high fuel costs.
Boeing hits record output for '99
SEATTLE (AP) -- The handing over of four airplanes to a German leasing company pushed the total number of deliveries for The Boeing Co. in 1999 to a record 620 -- that's 57 more than the company did last year.
And $300 million in new orders from Air Berlin was icing on the cake. Air Berlin ordered six 737-800s worth $300 million on Wednesday, and Boeing also announced that Hapag-Lloyd Flug ordered two 737-800s for $100 million on Thursday. The Hapag-Lloyd order was announced earlier this month as an anonymous order.
Bavaria International took delivery of Boeing's final order of the year Wednesday, said Boeing spokesman John Kvasnosky.
Court says SGL misused bankruptcy
WILMINGTON, Del. (Bloomberg) -- SGL Carbon AG, the world's biggest maker of graphite products for steelmakers, misused U.S. bankruptcy laws to push customers into settling antitrust lawsuits over its participation in a price-fixing conspiracy, an appeals court ruled.
The 3rd U.S. Circuit Court of Appeals concluded that SGL Carbon Corp., SGL Carbon's U.S. unit, improperly sought Chapter 11 protection in U.S. Bankruptcy Court in Wilmington, Del., last year to gain leverage in the antitrust suits, rather than to fix business problems.
The decision, which comes two weeks before an approval hearing on the company's bankruptcy reorganization plan, won't disrupt more than $39 million in settlements reached with SGL customers who bought graphite electrodes at inflated prices, customers' lawyers said.
"The settlement was not contingent on the outcome of the bankruptcy case," said Howard Sedran, a Philadelphia lawyer who represents steelmakers suing SGL. "It has no effect on us."
SGL officials and company lawyers weren't immediately available to comment.