Pickens: Corporate Takeovers Legit

Speaking in front of a full house at the Kennedy School of Government last night, two prominent corporate raiders justified hostile corporate takeovers as legitimate and beneficial business transactions.

T. Boone Pickens and Irwin L. Jacobs, whose controversial financial maneuvers have netted them tens of millions of dollars, attempted to dispel the image of raiders as the bandits of Wall St.

Introduced as "the champion of the small shareholder," Pickens said his takeover bids benefit individual investors--"people who run elevators or drive taxis"--by forcing corporate managers to restructure their corporations for greater efficiency.

By the same token, Pickens said in a heavy Texas twang, he would do nothing contrary to the interests of his own stockholders to fend off a hostile takeover attempt.

"We won't spend a dime to keep any offer from the stockholder," he said.

Echoing Pickens's sentiment, Jacobs said takeover bids enhance the economy by weeding out weakness and forcing managers to rethink their businesses.

Jacobs said takeovers are "all bad or all good depending on how you look at it."

"Mine are all good," Pickens replied, eliciting laughter from the audience.

The two financiers concurred on a variety of topics but disagreed on the state of American business.

"To use the term 'The Corporate America is misrun' is a mistatement," Jacobs said, standing up for the nation's business leaders.

Pickens differred strongly. "I don't think that 50 percent of the companies in America today are well-run. We're 50 percent apart on that."

Pickens, chief of Mesa Petroleum Inc., is known for his frequent attempts to seize a controlling interest in a company and then to sell-out at a profit once his threat becomes apparent. Such tactics are known as "greenmail."