The Daily Herald from Chicago, Illinois • Page 40

DailyHerald SECTION Wednesday, November 5,1997 THE MARKET NYSE: 494.06 Nasdaq: 1631.15 Dow Jones Industrial Average 18200 18100 18000 17900 780 AMEX: 688.37 SAP: 940.76 7300 7200 WED THU FRI DON TUE WED THU FBI WON TUE WED THU FBI MON TUE 15 16 17 20 21 22 23 24 27 28 29 30 31 3 4 Stocks gain slightly after rocky morning Stocks drifted higher Tuesday, the calmest session in two weeks, padding Monday's big rally and chipping away at the little remaining damage from last week's tumble. The Dow Jones industrial average recovered from a morning loss of 52 points. Broad-market measures also brushed off some early weakness spurred by another rocky day of trading on overseas markets Page 4. PORTFOLIO Retirees should watch health-care coverage While most employers can reduce their employees' medical benefits at will, retirees also should keep a sharp eye on their coverage. Sherwood Ross Page 5.

After-tax profit percentage near high After-tax corporate profits now equal 5.4 percent of gross domestic profit, the highest share in 16 years, Sherwood which may not help stocks. Brendan Boyd Page 5. ROSS Looking back on wild week Last week's wild Wall Street roller coaster shows just how dependent the Linda is on irrational pack psychology. But what can be done about it? Stern Linda Stem Page 4. BUSINESS BRIEFS Regulators to extend Conrafl deal review WASHINGTON In response to growing concerns about rail safety, federal regulators will spend an additional six weeks reviewing two railroads' proposal to take over Conrail.

Officials of CSX Corp. and Norfolk Southern Corp. said Tuesday they do not expect the 45-day extension to significantly change their schedule for integrating Conrail routes. Chrysler completes "97 stock buyback AUBURN HILLS, Mich. Chrysler Corp.

said Tuesday it completed its $2 billion stock buyback program for 1997 and will begin buying back another $2 billion of its stock. The nation's No. 3 automaker said the recent volatility in the stock market allowed it to complete its 1997 buyback in October and begin a new repurchase program for 1998. Apple, CompUSA in'recommitment' CUPERTINO, Calif. Apple Computer Inc.

and CompUSA Inc, one of the nation's largest computer store chains, on Tuesday unyeitethijiew "store within a store" concept for Apple as part of what CompUSA termed a "recommitment" to the computer maker. CompUSA will outfit more than 40 of its stores in key markets with the Apple departments before the holidays. Lott: No new money for Amtrak dispute WASHINGTON Congress will not come up with new money to help financially crippled Amtrak settle a wage dispute with one of its major unions, Senate Majority Leader Trent Lott said Tuesday. Amtrak and the Brotherhood of Maintenance of Way Employees reached tentative agreement Sunday on a three-year contract dispute, averting a strike that could have affected 50,000 Amtrak riders and 500,000 rail commuters in major cities. The start of something big? Laidlaw's offer for Safety-Kleen may entice other suitors as well BY DAN CULLOTON Daily Herald Business Writer Laidlaw Environmental Services' nearly $2 billion unsolicited offer for Safety-Kleen Corp.

could trigger more bids for the Elgin company that essentially put itself on the market three months ago, analysts said Tuesday. Three months after Safety- Kleen fired its president and hired the investment banking firm William Blair Co. to "explore strategic options," Laidlaw Environmental Services, which was spun off from Laidlaw a Canadian school bus and waste hauling company, on Tuesday declared it wants to merge with Safety-Kleen in a deal worth $1.8 billion. In a conference call with reporters and analysts, James R. Bullock, chairman of Laidlaw Environmental Services, said his company is offering $14 in and 2.4 shares of Laidlaw stock for each of Safety-Keen's 58.3 million outstanding shares.

Laidlaw already owns 600,000 shares of the hazardous waste removal and recycling company. "I think at this point, it's a valid bid," said Michael Hutchinson, an analyst with Barrington Research Associates in Chicago. "At this point, though, this could be just the beginning of a lot of other offers. "Someone could still come in and offer $26 (per share) in cash," Hutchinson said. "This whole deal is still up in the air.

It's just the beginning of all of this." Making a bid Elgin-based Safety-Kleen became the target Tuesday of a $1.8 billion hostile takeover bid from Laidlaw Environmental Services. Safety-Kleen Business Laidlaw Environmental Services recycling services for hazardous waste repair, incineration, processing, industrial, imaging recycling and landfilling 1996 revenue 1996 income $923 million $61 million Employees 7.300 Tuesday's stock price.J25.81J/4 $61.6 million Safety-Kleen financial history (in millions, except per share information) 1.992 1993 1,994 1995 1996 Revenue .8795.5 $859.3 $45.6 $50.1 $53.3 $61.1 Net per share $0.87 $0.92 $1.05 Includes restructuring and special charges of S136 million Souses: Satety-Kleen, Environmental Services Daity Herald Graphic Safety-Kleen did not reject Laidlaw's proposal outright. Spokesman Paul Wyche said the company "will consider their proposal as well as those of others, as well as other strategic alternatives." Wyche would not say what, if any, other offers are on the table. Bullock said Columbia, S.C., based Laidlaw Environmental Services decided to appeal directly to Safety-Kleen shareholders after talks with the company about a more modest Laidlaw proposition made six weeks ago went nowhere. The new bid is 18.2 percent more per share than Safety- Kleen's closing stock price of 2 last Friday and 46 percent more than where Safety- Kleen's stock had been trading before the company hired William Blair, Bullock said.

However, Laidlaw is open to adjusting the offer if Safety-Kleen is willing to talk or if another offer surfaces. "We'd have to see why it should be changed," Bullock said. "We think its a very fair offer." Bullock also said Laidlaw has secured bank financing for the deal and is ready to proceed without further due diligence. If Safety-Keen's board of directors rejects the bid, Bullock said the company may be willing to wage an extended takeover battle. "We did not enter this exercise lightly and today we believe there is great merit in what we are proposing," he said.

Laidlaw, which is the largest provider of hazardous waste management services, sees the acquisition as a "synergy play" and expects to glean $100 million in annual cost savings through the combination, said Kenneth W. Winger, president and chief executive of Laidlaw Environmental Services. Laidlaw will squeeze out the savings by combining overlapping hazardous waste collection facilities in the field and reducing back-office expenses, Winger said. Hutchinson said if the deal goes See SAFETY-KLEEN on Page 2 In the air, it's cheaper if you're not on business BY SCOTT MCCARTNEY The Wall Street Journal The gap in the air has never been wider. While airlines continue to woo leisure travelers with bargains, they're squeezing business travelers like never before.

Discounts on unrestricted fares have become as rare as in-flight dinners, and with business fares already up by 20 percent this year, carriers pushed through an additional 5 percent across-the-board increase hi September. In contrast, prices for leisure tickets actually have fallen slightly, according to American Express Travel Services. "They've got you and they know it," grumbles construction execu- tive Tony Konosky, who recently wasted a week trying to find a ticket from Houston to Bombay, India, for less than $2,500. "It's like there's a target on your chest." Konosky isn't far off, given the advanced technology that carriers now have at their disposal to set and manipulate fares. Computers allow airlines to constantly tell each other about fare changes, tamping down the chances that any one will gain even a momentary price advantage.

And an obscure mathematical science known as "yield management" empowers airlines to project almost precisely how many last- minute business travelers will show up willing to pay whatever it See AIR on Page 2 Buntrock pushed aside at Waste Management Daily Herald News Services Waste Management Inc. said its former chairman and chief executive, Dean Buntrock, will no longer have an active role on the board's standing committees, just days after the trash-hauler's chief executive resigned abruptly. The Oak Brook-based company also said it named Roderick Hills, a former chairman of the Securities and Exchange Commission, and John Pope, a former president and chief operating officer of UAL as directors, bringing the total to 14. The changes follow the sudden departure of the chief executive Ronald LeMay, who quit last week and returned to his former job as president and chief operating officer of Sprint Corp. The announcement also trails news that the company will adopt more conservative accounting policies, possibly resulting in lower earnings, and lingering criticism that the company lacks direction and focus.

On Monday, an investor filed a federal lawsuit, seeking class action status, to recover the losses suffered after abrupt resignation. The company on Tuesday also suggested an audit of its operations might result in a restatement of prior earnings, although Robert "Steve" Miller, acting chief executive, said last week he didn't expect to restate profit from past quarters. Waste Management's audit committee, which will be led by Hills, is reviewing the company's North American operating assets and investments. Waste Management also said it created a search committee and hired executive recruiting firm Heidrick Struggles to help find a replacement for LeMay. The firm found LeMay, who replaced Phillip Rooney.

The company also reshaped its audit, nominating and search committees and said ex-CEO Buntrock, while remaining a board member, will no longer participate on its committees. Buntrock was seen by some investors as an obstacle to change in the company, analysts said. Waste Management stock, hammered after LeMay's resignation, closed up $1.25 Tuesday at $25. BRIEFS IMmed posts 41 percent gain BUFFALO GROVE Unimed Pharmaceuticals Inc. has announced revenue of $3.4 million for the third quarter of 1997, an increase of 41 percent from the $2.4 million in the third quarter of 1996.

The Buffalo Grove-based firm earned $196,000, or 2 cents per share, in the third quarter, compared to $392,000, or 4 cents per share, during the same period last year. Company officials said the gain was in line with predictions and they credit new drug products. Niles piping firm wins projects NILES a manufacturer of custom-designed filtration products, specialty piping and industrial cooling equipment, announced that it has won $4.8 million hi new piping system contracts, on the heels of completing $4.5 million in piping work. Schawk declares dividend DBS PLAINES Schawk Inc. reported that its board of directors has declared a regular quarterly dividend of 6 cents per share and named A.

Alex Sarkisian the firm's chief financial officer. This will be the 82nd consecutive dividend paid by Schawk, a provider of digital imaging prepress services for the consumer products'industry. Schaumburg company makes it possible to open Windows BY ANNE SCHMITT Daily Herald Business Writer Computer users don't buy Install- Shield products, but they almost certainly use them. "Our software is imbedded hi the software applications that the average consumer might buy," said InstallShield co-founder Viresh Bhatia. That's putting it modestly.

Microsoft Corp. endorsed the Schaumburg-based company's installation tools for software developed for its Windows 95 operating system. Bhatia estimates that now 85 Business profile Names: Viresh Bhatia, 32, president; Rick Harold, 35, chief technical officer Business: InstallShield which produces installation software for developers writing software for Windows, Java and the Internet Revenues: $23 million in 1997 Philosophy: "The company philosophy is to build a great environment with great people and great products," says Bhatia. to 90 percent of the software written for Windows platforms uses Install- Shield products. So what does it do? The Install- Shield software runs a complex series of tests and procedures required before new software can download onto a computer hard drive.

For example, InstallShield makes sure that a computer meets all the memory and other requirements to run the software. Then it installs the application and integrates it into the hard drive of a computer. The story of InstallShield is the tale of how two college students from Schaumburg turned a hunch about the future popularity of the Windows operating system and a good idea into a company with annual sales of $23 million. Bhatia and co-founder Rick Harold, InstallShield's chief technical officer, met as undergraduates at Northwestern University's computer science program during the 1984-85 school year. They shared classes and rubbed elbows in the computer lab and the cafeteria.

The two had something in common right off the bat both came to Evanston via their hometown of Schaumburg. Harold graduated from Conant High School and Bhatia from Hoffman Estates High School, both in Hoffman Estates. Viresh Bhatia and Rick Harold founded InstallShield after graduating from Northwestern University's computer science pro- 9 ram Daily Herald Black They started their partnership around Christmas of 1987 while Bhatia completed his last quarters of school. After college, they took corporate jobs but met during off hours, first in an 8-by-10 room in the former Roselle library, then at Harper College. Bhatia and Harold decided to focus their work on creating an off-the- shelf geographic mapping software product for Windows, an operating system that only was emerging at the time.

"We felt it would be an emerging platform in the future," Bhatia said. They also liked the potential for flexibility they saw in Windows. Along the way, Harold developed the installation tool. "We needed our own tools for our own use to create internal applications," Bhatia said. They quickly recognized the potential of the installation software and abandoned efforts to develop the mapping software.

By 1990, they had quit their full-time jobs, turned their partnership into Stirling Technologies Inc. and unveiled their Install- Shield family of products. See SUCCESS on Page 2.