Tyco Breaks Out of Its Mold: Buying commercial lender CIT is its biggest gamble yet

On March 13, Dennis Kozlowski, CEO of industrial conglomerate Tyco International Ltd., announced his riskiest deal yet. He plans to buy the commercial lender CIT Group Inc. in a mostly stock deal initially valued at $9.2 billion. With CIT, he is venturing into commercial finance - at the outset of w...

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Bibliographic Details
Published in:Bloomberg businessweek (Online) 2001-03 (3725), p.48
Main Author: William C. Symonds in Boston, with Pamela L. Moore and Heather Timmons in New York
Format: Magazinearticle
Language:English
Subjects:
Acquisitions & mergers
Commercial credit
Conglomerates
Finance companies
Going public
Risk
Scandals
Stock prices
Online Access:Get full text
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Summary:On March 13, Dennis Kozlowski, CEO of industrial conglomerate Tyco International Ltd., announced his riskiest deal yet. He plans to buy the commercial lender CIT Group Inc. in a mostly stock deal initially valued at $9.2 billion. With CIT, he is venturing into commercial finance - at the outset of what could be a prolonged slump. What is more, he is offering a 54% premium for a company that has performed poorly since going public in 1998. So it is little wonder that investors trimmed $5 - 11% - of Tyco's shares after the deal was announced.
ISSN:0007-7135
2162-657X