avon products to buy mallinckrodt
TRANSCRIPT
tyldisilene is probably just the forerunner of a large class of compounds containing multiple bonded silicon atoms. It may even prove possible to make stable compounds with silicon-silicon or silicon-carbon triple bonds. In addition, the work is being extended to include germanium, the next element in the group. It's hard to say just where the work will lead, West says, but it likely will give new insights into the nature of the chemical bond and it may turn up useful new materials with unexpected properties. D
Demand to stay strong for new engineers In spite of recession and generally rising unemployment, demand for graduates in engineering and many other technical fields will continue to increase at a healthy rate in 1982. Starting salaries will reflect the strong demand, according to two annual employment forecasts—Northwestern University Placement Center's "En-dicott Report" and Fox-Morris Personnel Consultants' "U.S. Professional Job/Salary Outlook."
The Northwestern survey, based on information from 242 large- or medium-sized corporations, says that for 1982 total new-graduate hiring "intentions" (which usually correlate well with actual hiring) are up 11% for bachelor's-degree holders and 12% for those with masters, compared to 1981 figures.
The outlook varies considerably for different fields, however. At the B.A./B.S. level, according to the Endicott Report, hiring intentions are up 21% for engineers of all kinds, 18% for computer scientists, and (although the actual numbers are fewer) a strong 37% for chemists. But for "nonengineers," total hiring of new bachelors is expected to rise only 6%. The forecast shows little change for liberal arts graduates and a 19% drop in demand for graduates in "mathematics-statistics."
Similarly, at the master's level, demand is up 28% for engineers, only 9% for "nonengineers." However, the "M.B.A. with technical B.S." continues to be popular, with hiring intentions up 21% for that group. But demand for 'M.B.A. with nontechnical B.A." will grow only 12%.
Although the Fox-Morris forecast isn't limited to entry-level positions, its findings generally corroborate those of the Endicott Report. However, it says that data processing/
computer specialists will be the superstars in 1982, with overall demand up 19% from 1981 levels. Companies' "broad-based engineering needs" will jump 16%. Specifically, demand will be up about 20% for electrical/electronic engineers, 18% for mechanical engineers, and 15% for chemical engineers.
Starting salary increases will range from 4.7 to 13.4% in 1981, depending on the discipline, the Endicott Report says. At the bachelor level, predicted average monthly salaries for new engineers will be $2119 (up 11.4% from 1981); for chemists, $1791 (up 10%); for computer scientists, $1855 (up 6.8%). New engineers at the master's level will start at an average $2349 per month, up 10.0% from 1981. The average for "other technical" M.S.'s will go to $2214, up 9.5%.
The Fox-Morris numbers are different, but not startlingly so. According to that forecast, entry-level averages in 1982 will be $2150 per month for chemical engineers, $1975 for mechanical engineers, $1958 for electrical engineers, and $1733 for graduates in the computer sciences. In contrast, the average business/accounting graduate will start at $1375 and the average liberal arts graduate at $1167, Fox-Morris says. D
Avon Products to buy Mallinckrodt Mallinckrodt, the St. Louis-based producer of medical reagents and supplies, drugs, and specialty chemicals, has agreed to a merger of the company with Avon Products, the New York City-based cosmetics firm. Avon may pay up to $750 million in cash and Avon stock for Mallinckrodt.
For Mallinckrodt, the deal means a safe haven for the company with a parent that will continue its business philosophy and strategies. Mallinckrodt has long been eyed as a target for a possibly unfriendly takeover. The firm also may benefit from heavy future investment by Avon, which traditionally has generated large amounts of cash.
To Avon, the merger means diversification away from cyclical consumer sales, which suffer with inflation surges and economic downturns. Mallinckrodt's sales have grown steadily at 17% per year over the past decade and have almost quintupled in 10 years. The St. Louis company's earnings likewise have increased almost sevenfold in the same period, at an annual growth rate of 21%.
A third beneficiary of the merger could be National Distillers & Chemical Corp., which in the past 15 months has bought almost 1.3 million shares of Mallickrodt, or 9% of the shares outstanding. Some analysts have suggested that National Distillers was preparing for a takeover of its own. Spokesmen for National Distillers have no comment about the pending Avon-Mallinckrodt merger. National Distilers paid about $42 million for its holdings in Mallinckrodt. If the company decides to sell at the Avon offer of $50 per share, it could realize a $23 million profit.
If the planned merger goes through without a bidding war with a third party, it also would solve temporarily a moral and financial dilemma on the part of trustees of Harvard Universiity and Washington University (St. Louis), who together hold 17% of Mallinckrodt stock. The two universities inherited the stock 15 years ago from the late chairman Edward Mallinckrodt Jr. If the trustees were to refuse a favorable offer in an unfriendly takeover, they would be neglecting their responsibilities to their universities. If they were to accept such an offer, it might chill the climate for further bequests from companies.
Avon sales last year amounted to almost $2.6 billion, mostly from door-to-door sales of men's, women's, and children's cosmetics, toiletries, fragrances, and jewelry. Mallinckrodt's 1980 sales were $442 million, of which more than half was in health care products, almost 30% was in specialty chemicals, and 17% was in food, flavor, and fragrance products. D
Dec. 21, 1981C&EN 9
Avon, Mallinckrodt profits high, but Avon is slipping Drofit margin3
13 12
11
10
9
8
7
6
5
Ο -
1971 72 73 74 75 76 77 78 79 80 81b
a Net earnings as per cent of sales, b First nine months.