Business mergers continue strong

13uilding produt'ts compartit's accortttlerl for -1,7 of the ret'or<l-hreaking total of 2.975 mergers in 1967. according to S'. 'l-. Grimm & Co., a financial consulting lirm specializing in mt'rgers and rrorporate cottsolidations.

In tht'lrreviotls \('ar lJ7 mlr:1,'rs rx ( ttl're(l in the building products group. The total number o[ merger-. retordt'd in 1966 rvas 2.:t77.

Stock was twicc as liopular as cash in |967 as an acquisition medium in l,uilding products mergels. Of tht' 17 mergers in thc fit'ld. 2U w'ert for stock and 14 for ca*h. (lash-stock rnmbinations accounted for the remainins Iir.c transac'tiorrs. In the ovt'r-all study'. stoik transactions r:omprised 60 perct'nt of all mergcrs" cash acurunted {or |i(r per<:ent, and cash/stock accounted {or four' perccnt. In the Jruilding products categor'v. c'ash transactions (57) outnumbered tlrosc madc for stock t25) by mort, than two-toone in 1966. That lear the over.all studv disclosed that 60 perccnt of all transactions were for cash. iJ5 pt:rcent for stock and livc percent for cash-,*tock.

The average prir:t'/earninS-s ratio pairl for building produr:ts companies in 19(17 was 12.u. virtuall,v tht' same as in 1966 when tht' ratio was 12.7. The avcrage p/t ratio for all companies in the strrdy u'as 17.6. Ratios paid ranged from a low of ll.8 irr tht' appart'l and plastits groups l() a high of ,J6.3 for publir: utilities. Plicer/ earnittgs ratios arc lrased onlr on thosc mergers where dt'tails of purc'hase prit't: and rarnings of the acquircd (:ompany *'ere alailalrle.

Divisiorral spin-of fs a<:courrte<l i.rr I lruilding prt,rtlucts mergers in l9fr7. F,.rrt'ign acquisitions {ell o1T sharph' in thtr group" as onl,v one su('h lran-sactiorr rvas efft'cted, dowrr from nint' in 1966. lrr 1967. tt'nder ollers wcre used to t'ffect thrt't' nrergcrs in the grotrp,

(iommt'nting upon the trerrrl and otrtlook fol the building protlucts group. E. P. Irillion. Jr. of the Grimm organization said that mt'rger activity and pritts declined irr 1967 due to the short-range outlook for tht' housing market. Ht' t'ited int'rca,sed ('onstruction costs. tight mortgag(' monet" antl the \Iiet \am war trs <'ircumstances working to impt'de the prrr<'hase of nt:lr or fir'st Ir,'m,'s. wilh resultarrl im|art on ('()r'porat(' t'arnings. He noted. honever. that lnryers oI lruilding products companit's have in tht: main becn major corllorations interestrrd in thc industry's (ive to ten vear grorvth prospr-r'ts. Their inlluence-lr1'-t'rample upon otlrers should lead to slightlv increased merger a('tilitv in tht' field in l9(rl]" he added. even in tht'face of .low nurnl,t'rs of housirrg starls.

-but not all merger attempts stay put-

Amt'rican Cement Corp. won't purchasr: Vard & Harrington Lumber Co. after all. both of the firms have confirmed.

"lt just didn't work out." Frank C. Harrington. president of the Southern California lumber company said, cchoing his partner Oil Vard who said that "{or various reas()ns. we callcd it of[." Both dcclined to give {urther l'easons. Just rveeks t'arlier. (:ompany spokt'smcn |ad assured all the mt'rgt'r was as good as effeccd.

Ward & Harringtort also own-. Allison Homes and Sunny Home,.. Inc.

American Cement. hcadquarteled in Los Angeles. rt'centlv opened Snowma,*sAt-Aspen. a recreational communitr devclopment in the Color-ado Rockies. The coml)any also has major di'r'isions irr California. Arizona. N{iclri-rran. Pcnnsvlvania. Harvaii and (llt'r'r'e.

Distributor's "Averqge" Sqlesmqn

During a recently completed Salesmanship Institute for Building Material Salesmeno sponsored by the National Building Material Distributors Association, a series o{ questions completed by each 'student" developed an interesting profile of the wholesaler's average outside salesmen.

The salesman attending the school was 39 years of age. married, and had 2.4 children;

. Has 13.4 years of formal schooling;

. Worked in the building industry lor 14.2 years and been in sales work for 9.7 years;

. Been employed by his present firm for 3.3 years;

. Been in outside sales with his present firm for 2.6 years, Of those who started with their present firm in positions other than sales, l0/o began as drivers; 23/o began as warehouse employees; 2i3o/o began as ofiice employees; I9/o began with counter sales; 23/6 began with phone sales and l\/a began in other positions. -

The salesman was responsible for 112 accounts, made an average of 34 customer calls per week and did a total annual volume o{ $496.000 in sales.

He was paid in salary ranges of :

$ 6,000 to $ 8,0003oc/c of salesmen

8,000 to 10,00030% of salesmen

10,000 to 12,00038% o{ salesmen

Over 12,0002% of salesmen

His earnings were computed on the basis of :

Straight salary -25% of salesmen

Salary with bonus20a/o of salesmen

Salary plus commission25/o oI salesmen

Commission with draw5% of salesmen

Straight commission25% of salesmen