THREE PLUS ONE EQUALS BILLIONS: The Bendix-Marietta War by Allan Sloan


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The story behind what was ""perhaps the messiest corporate takeover battle ever waged,"" which even the ultimate ""victor"" (Allied Corporation's Ed Hennessy) referred to as ""a very sorry spectacle for American business."" Sloan offers a clear chronological run-through of the four-way (Bendix, Marietta, United Technologies, Allied) battle, highlighting the strategic thinking behind the parties' moves and countermoves, but his real interest lies in the personalities involved--especially Bendix chairman William Agee, his wife/advisor Mary Cunningham, and Tom Pownall, Marietta's no-nonsense chief. Sloan paints Agee as an ex-Harvard Business School whiz kid whose skill at selling Bendix assets hadn't been matched by success in redeploying the funds generated. Past 40, bored and restless, Agee wanted to make a big move of some sort (he'd made a halfhearted attempt to promote himself as a possible GOP vice-presidential candidate in 1980). His much-publicized relationship with Cunningham (which Sloan belabors somewhat) clearly hurt him: not only did it alienate Bendix executives, some of whom apparently helped out Marietta sub rosa during the takeover battle, but it caused other business leaders to question Agee's judgment. (Sloan is merciless on Cunningham--""a person lacking in both practical business experience and emotional maturity""--and quotes Gall Sheehy as calling her ""what most women fear being thought of as."" Her own story is scheduled for early next year.) Old-fashioned hubris led Agee to make several key mistakes in the Marietta war: he excluded virtually everyone but Cunningham from his decision-making process; he hired two sets of investment bankers, then rarely listened to either, and thus wound up trying to employ a variety of different strategies simultaneously; he misplaced reliance on the courts (especially on the theory that no court would allow Marietta to buy control of Bendix after Bendix had bought control of Marietta); and, most of all, he underestimated the vast gap between the ""corporate cultures"" of Bendix and Marietta, and the willingness of Tom Pownall to detonate the ""doomsday machine""--i.e., Marietta's legal commitment to buy Bendix's shares, even if Bendix had first bought Marietta, thereby ensuring almost certain financial disaster for both companies. Almost no one comes out looking good here, but Agee comes out worst of all. More gossipy and opinionated than Lampert's Till Death Do Us Part (above), but more insight on why this $4 billion debacle occurred.

Pub Date: Aug. 1st, 1983
Publisher: Arbor