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TWO WAYS TO GET PUMPED UP

No matter how it ends, the quest for Commercial Intertech (TEC) may yield a win-win situation for some risk players. Intertech is trying to thwart a June 27 hostile takeover bid from United Dominion Industries, which on July 25 increased its offer from 27 to 30 a share.

Intertech, a maker of hydraulic components, building products, and fluid-purification systems, escalated the fight on July 29 by announcing the spinoff of its profitable Cuno unit to stockholders. Each shareholder will receive one new-ly minted Cuno share for each share of Intertech held as of Aug. 9. Cuno will soon apply to trade on Nasdaq. Intertech's stock rose to 29 1/2 after Dominion made its initial offer--then slumped to 26 when the bid was rejected.

Analysts expect Dominion to mount a legal challenge to the proposed spin-off. Even so, some pros argue that Intertech is still a good buy. Why? Intertech's Cuno, which also makes fluid-purification systems, is worth $200 million, or 14 1/2 a share based on 13.7 million shares, according to one investment banker. He feels that Cuno's worth could double in a year or so, whether or not the spin-off happens. Dominion may opt to raise its offer for Intertech, especially if its real target is the Cuno operations, says this pro.

BY GENE G. MARCIAL


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Updated June 14, 1997 by bwwebmaster
Copyright 1996, Bloomberg L.P.
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