The Los Angeles Times from Los Angeles, California • 54

Allis Ends Merger Talk With General Dynamics usiness 10 Port "I THURSDAY, SEPTEMBER 7, 1967 Ii mi ii i Area rea Climbs to ifWX economy Market Continues Uptrend in Spite of Detroit Jitters I in August JV I III Ml I lit PONTIAC CONVERTIBLE Pontiac Motor Division of General Motors Corp. Wednesday showed its 1968 GTO convertible which features the new Endura front bumper made of a special energy-absorbing chemical compound. Other standard features include 400-cubic inch V-8 engine. Times drawing by Frank Bursinger Pontiac to Introduce Rubber Bumpers, Cut Tempest Length BY BOB THOMAS Timw Auto Editor 1 -illltEi 92 9I 90 1 lZ Ii IN MUUON5 12 -f 11 t- 728 84 8H 818 825 91 98 A-C Shareholders Bring Suit Oyer Rejection of LTV NEW YORK (DJ) Allis-Chal-mers Manufacturing Co. and General Dynamics Corp.

announced jointly Wednesday that they had terminated merger talks. Word of this followed closely on the heels of a report from Wilmington, that a shareholder or shareholders of Allis-Chalmers. had filed a suit in chancery court, challenging the company's rejection last month of two takeover bids from Ling-Temco-Vought Inc. The General Dynamics merger talks reported three weeks ago were announced during the takeover bids by Ling-Temco. With Deep Regret' Roger Lewis, president of General Dynamics, and Robert Stevenson, chairman of Allis-Chalmers, said the decision to terminate merger discus-sions had been taken by the managements with "deep regret" and both expressed the hope of the possibility of reopening discussions soma time in the future.

Allis-Chalmers directors in the most recent refusal to LTV questioned "the intrinsic value of the securities being offered Allis-Chalmers shareholders in exchange and the realizable value compared to the value ($590 million claimed by LTV." Stevenson also sharply criticized LTV for. the manner in which the proposals had been made. The General Dynamics-Allis-Chal-mers announcement came after the close of the New York Stock Exchange. During the session. Allis-Chalmers was the third most active issue and up lVk to 357.

Price Dips on PCSE In late trading on the Pacific Coast Stock Exchange, Allis Chalmers dipped to 344 on turnover of 7,500 shares, in apparent response to the announcement. In Wilmington, Chancellor William Duffy, who will be hearing the Allis-Chalmers shareholder action, said it was the court's policy not to release deatils of the suit until all defendants have been served or. "until 10 days elapsed from the date of filing Sept. 1. Attorneys for both sides also declined to answer inquiries about the suit, although George Tyler Coulson, attorney for Allis-Chalmers confirmed the shareholder suit had been filed.

A spokesman for Allis-Chalmers reached at the company's Milwaukee headquarters said replies to any suits "would be made through legal channels." BY PHILIP GREER Lot Angtltt TlmnWMhiniton Pott Ntws Strvlct NEW YORK Despite a budget of discouraging business reports mostly from Detroit the stock market was able to thumb its nose at the news wires long enough Wednesday to post a small gain in heavy trading. For most of the session, the threat of a strike against Ford, the drop in auto sales in August and the cut in capital spending plans reported by a government survey, had little effect. Before the close, however, second thoughts came in again and prices slid. The early push, though, provided enough of a cushion for the list to finish the session on the plus side for the second straight day. Dow Jones Up 2.83 The Dow Jones industrial average, up more than 4 points around midday, finished with a gain of 2.83 at 906.96.

Standard Poor's 500-stock composite rose 0.18 to 94.39 and the New York Stock Exchange index was ahead 0.09 to 52.51. Volume climbed again, to 9.56 million shares from 8.32 million traded on Tuesday, but the margin of advancing stocks over declines was somewhat narrower. At the final count, 701 issues were ahead and 528 were down. New highs totaled 106 and new lows 20. Auto stocks were in the limelight all day.

Ford, the target company in this year's negotiations with the United Auto Workers, opened lower, climbed slightly and fell back to finish at 50V, off V. Chrysler and General Motors, meanwhile, were swinging through a wider range. Chrysler fell under 50 at one point but closed at 50, off SA. GM held on to a Vs-point profit at 84. Pan American World Airways easily took the top spot on the active list after turning over a block of stock at its lowest price of the day.

The block was sold through a West Coast brokerage firm and the specialist making a market in the issue bought shares. The issue finished at 2778, off la. American Stock Exchange prices showed little change but volume continued climbing. The Amex average lost 1 cent to $21.41 as 4.04 million shares changed hands. came up in.

two sizes for the first time. The Tempest series coupes and convertibles have been reduced three inches to 112 while the four-door models and station wagons are up an inch to 116. In all, DeLorean introduced a 34-model lineup. DeLorean was definitely bullish about the 1968 market picture for Please Turn to Page 11, Col. 4 J.

B. Williams Co. to Acquire 19 of Columbia Pictures NEW YORK m-J. B. Williams Co.

said Wednesday it had agreed to buy a 19 interest in the common stock of Columbia Pictures Corp. Williams, a New York-based maker of pharmaceuticals and toiletries, said it agreed to the purchase for investment reasons. Columbia, a film producer, said there was no consideration of merging Williams with Columbia. Williams said it was buying 400,000 shares of Columbia stock from the Banque de Paris et Des Pays-Bas. It was reported last week that the bank planned to sell its 36 interest in Columbia 762,925 shares for $46 a share to an unnamed group.

Other purchasers of the stock include Greek shipping magnate Stavros Niarchos, Investors Variable Payment Fund National Securities Growth Stocks Series, and two employe stock funds at Columbia and at Screen Gems, a subsidiary. All are reported "friendly" to Columbia management. A Columbia spokesman said the closing date for the group's purchase of the stock was today. Officials of the French bank were not available for comment. $322 Million OKd for Antimissile WASHINGTON (5) The Defense Department has approved in contracts for research and development of the Nike antimissile, North Carolina members of Congress announced Wednesday.

These contracts go to Western Electric, Corp. for work at its Burlington (N.C.) plant; to Martin Marieta Orlando, to Raytheon Bedford, to Univac of Sperry Rand St. Paul, to General Electric Syracuse, N.Y., and Douglas Aircraft, division of McDonnell Douglas Corp. in Santa Monica. DO IT Record Leve SOUTHERN CALIFORNIA'S eco-nomy advanced to another record in August the fourth successive month in which new highs have been reached.

The area's business activity was measured at 164.7 on Security First National Bank's economic index, a gain of more than 7 since August last year. The index has been rising steadily nce May when a reading of 157.5 toppled the previous record of 156.2 set in July, 1966." The index rose to 160.7 in June this year and to 162.6 in July. Among components making up the index, bank clearings set in the pace in August as they did in July. The largest bank clearings gains in several years have been recorded during the past two months, the bank said. The construction activity component also rose during August.

However, department store sales and real estate activity, having increased in July, remained relatively unchanged during August. The bank reported 4,567,000 civilians employed in Southern California metropolitan areas in July, the latest month for which figures are available. This was down 0.19 from June's record level, but up 2.9 over July, 1966. Nationally, the year-to-year increase was 2.1. ACQUISITIONS: Interstate signs agreement with Automatic Sprinkler MANAGEMENT OF Interstate Engineering Anaheim, Wednesday signed a definite agreement for its proposed acquisition by Automatic Sprinkler Corp.

of America, Cleveland. Shareholders will vote on the agreement within the next 60 days, the company said. Terms call for Automatic Sprinkler to acquire Interstate's stock in return for 829,878 shares of common and 219,878 shares of a new convertible preferred. The Cleveland firm's common stock closed in over-the-counter trading Wednesday at 49 bid. Interstate is predicting record sales of $40 million this year.

FREIGHT RATES: Truckers get 3 -5 hike in Pacific inland area AN' INTERSTATE Commerce Com-' mission board Wednesday voted to permit truck freight rate increases of 3-5 in the Pacific inland region, effective Sept. 9. Rates will go up 3 on shipments of 10,000 pounds or more and 5 on smaller loads. An earlier request for the increases was turned down by the ICC in July. The new rates will affect Washington, Idaho, Oregon, Montana, Utah, Nevada, Arizona, California and parts of Colorado and New Mexico.

GAS: Local firms ask speed-up in El Paso's LA. delivery plans TWO SUBSIDIARIES of Pacific Lighting San Francisco, Wednesday urged the Federal Power Commission to speed up plans for delivery of gas to Southern California by El Paso Natural Gas Co. El Paso has asked to build a 553-mile pipeline at a cost of $118 million to move gas to the Los Angeles area by November. The application has been consolidated with another request to supply Canadian gas to Northern California. The Pacific Lighting subsidiaries said it would take at least six months to build the line nd that they would "encounter serious difficulty" in meeting demands if construction were not expedited, DIVERSIFICATION: Rexoll Drug to acquire Seattle leasing company REXALL DRUG Chemical Los Angeles, Wednesday announced an agreement to purchase Epcon a Seattle-based leasing company through an exchange of stock currently valued at about $5.4 million.

The Seattle firm is principally engaged in leasing and sale of custom-made signs in the Pacific Northwest and mountain states. It expects 1967 sales of almost $5 million and earnings of about $435,000. Rexall reported sales of $251,791,000 and earnings of $13,561,000 for the first six months of this year. COMPANIES: D. Kaltmon claims 50 of Allied Artists preferred 1).

KALTMAN New York 'drug distributor, Wednesday announced it owns or controls more than 50 of the outstanding 5Vi convertible preferred stock of Allied Artists Pictures Hollywood. Because of arrears in dividends, holders of the stock elect a majority of the Allied Artists board. Kaltman offered $23 per share for the stock last week when it was selling for 19 14. The price rose to 51 Friday and trading was suspended by the American Stock Exchange. In the meantime, Kaltman cancelled its formal offer but said It would accept shares tendered at $23 and might continue to buy on the market.

Copper Industry Strike Perils Nation's Production of Gold DETROIT A rubber bumper shorter cars record sales. These were the more unusual elements that surrounded Pontiac division's press preview Wednesday of its 1968 automobile lines. The revolutionary bumper, naturally, was the highlight of the new-model unveiling at nearby Bloom-field Hills Country Club. Front bumpers on all of Pontiac's sporty intermediate GTO models will be coated with a "new Brazilian rubber-like material," said John Z. DeLorean, Pontiac's handsome and youthful (43) general manager.

It is not a safety factor, DeLorean confessed to newsmen. "It will absorb energy in minor collisions and avoid damage and repairs," he said. "When you are talking about injury-producing accidents, you are talking about the crushability of the entire front end of the car." Body Color Bumpers The bumpers are finished in body color to give the car a customized look, explained DeLorean. Production limitations confine the new bumper to the GTO and a projected sales volume of 100,000 units in '68. A major size change occurred in Pontiac's intermediate line, the Tempest series which includes the high-style GTO.

Surprisingly, the cars came up six inches shorter, the reverse of the trend in recent years to bigger cars. A new trend? "No," DeLorean said. "We style a car and then see what style it comes out. Actually, the reduction is due to the 'new look' of the long hood and short rear deck." Intermediate wheel bases also Las Vegas Hotel to Be 30 Stories Exelusiv Tht Timet from Staff Wrlttr LAS VEGAS Developer Kirk Kerkorian Wednesday gave details of his plans to build a 30-story hotel in Las Vegas, a proposal that would make it the tallest hotel in town. Kerkorian, landlord of Caesars Palace and operator of the Flamingo Hotel, said the new structure would cost $50 million and would be situated one block east of the Strip on Paradise Road.

To be called the International Hotel, the building will have 1,510 guest rooms, a casino, convention facilities, shops and offices. Kerkorian said he expected to conduct ground breaking ceremonies next November. The Clark County Board of Commissioners has approved the architectural plans. The building will be 354 feet tall. CAN'T LET OTHERS 'Crossover' to BY ARELO SEDERBERG Timts Stiff Writer The promotion to the managerial level the shift from doing the job yourself to telling others how it's done is a wrenching psychological transition that some people find impossible to make, a man who specializes in "management crossover" said here Wednesday.

Alfred J. Drucker, manager of the Management Development Center for the data processing division of International Business Machines has taken a survey of the problems confronting new managers and he outlined it before the Sales Marketing Executives Assn. of Los Angeles meeting at the Biltmore. Some don't make the grade, he said, because: 1 They find it impossible to let others do it, finding it easier to do it themselves. Said one survey participant: "The major challenge which I faced in the transition was the change from acting and doing to WEEKS ENDING YESTERDAY NEW YORK Standard Poor's 500-stock index closed Wednesday at 94.39, up 0.18.

High during the day was 95.06; the low, 93.72. The 425 industrials closed at 102.03, up 0.22; the rails at 50.13, off 0.30; the utilities at 67.83, up 0.12. The "500" high of 95.93 was set Aug. 4. The low of 80.38 was set Jan.

3. Volume rose to 9,550,000 shares from 8,330,000 shares traded Tuesday. OVER-THE-COUNTER The National Quotation Bureau index of 35 industrial stocks closed at 333.69, off 0.39. The 1967 high of 336.61 was set Aug. 10.

The 1967 low of 228.93 was set Jan. 4. LONDON The Financial Times index of 30 industrial stocks closed at 369.8, up 0.5, a new 1967 high. The previous high of 369.3 was set Sept. 5.

The 1967 low of 308.6 was set Feb. 28. Allied Artists complained earlier this week that settlement with its creditors had been complicated by the Kaltman offer. AUTO SALES: Industry's total off 15 at 518,970 cars in August SALES OP new U.S.-made cars totaled 518,970 cars in August, down 15 from August a year ago. Ford Motor Lincoln-Mercury division reported an increase for the period, with a total of 29,774 cars sold last month compared with 22,713 in August, 1966.

American Motors Corp. said sales fell to 14,454 last month from 22,283 a year earlier. General Motors Corp. earlier reported August sales down 14 at 266,461 cars. Figures are expected shortly for Chrysler Corp.

and for Ford's Ford division. AIRLINES: Three-line merger terms approved by Pacific board DIRECTORS OF Pacific Airlines Wednesday approved a definite agreement to merge their company with West Coast and Bonanza airlines. Bonanza's board will vote Friday and West Coast's Monday. All three boards previously approved the preliminary merger proposal. David Grace, Pacific chairman, said the agreement would be filed with the Civil Aeronautics Board Tuesday and said the firms hope for federal approval by Jan.

1. ET CETERA: Trends, forecasts and facts from the business world PROFITS PROPHETS: Southern Union Gas Co. expects 1968 earnings to resume an "established growth rate" despite a 1967 earnings forecast of about $1.70 per share, down from $1.82 in 1966 Diebold Inc. predicts third quarter earnings will exceed the 31 cents per share earned in the corresponding 1966 quarter. IN PASSING: The American Stock Exchange will rescind 100 margin requirements today on trading in stock of Data Processing, Financial General, Gale Industries, Kaneb Pipeline and McCulloch Oil of California Amex Wednesday approved listing of common shares of Marshall Industries, San Marino, and 6 convertible debentures of Ramada Inns Phoenix Two New York Stock Exchange seats sold Wednesday for $425,000 each, down $20,000 from the previous sale Santa Fe Railway will offer "one-price tickets," including meals and Pullman or pillow service, at all ticket offices, effective Sept.

15 U.S. electricity production totaled 23.831 billion kwh last week, up 1.6 from a year earlier Los Angeles electricity production totaled 320,920,000 kwh last week, up 27.24 from a year earlier. the copper Is recovered, the other minerals are recovered also. Of last year's total production of 1.8 million troy ounces, he said, about one-third came as a byproduct from copper mining operations. "Domestic sources of gold are in very short supply," Hibbard said, adding that last year's consumption of 6.5 million ounces was nearly four times domestic production.

Another speaker, William Butler, vice president of the Chase Manhattan Bank, said the quickest way to end a deficit in this nation's international balance of payments would be to end the war in Vietnam. He said another cure would be continued fiscal responsibility at home combined with cooperation with allies abroad. Butler said the United States has suffered a deficit in international transactions in 15 of the last 16 years. The deficit has averaged $2 billion for the last five years, he said. While this is small in relation to the country's $80 billion foreign trade, the deficit has resulted in an average outflow of $750 million from United States gold stocks, Butler said.

JULY BUILDING ACTIVITY REACHES $75.4 BILLION RATE WASHINGTON (DJ) Construction spending rose in July to a $75.4 billion seasonally adjusted annual rate from the downward-revised $74.4 billion June rate, the Commerce Department reported Wednesday. The July construction level also exceeded the $73.1 billion year-earlier pace but trailed the record $79.5 billion reached in March, 1966, the department said. The July gain from June was shared almost evenly by private and public sectors. Estimated physical volume of construction activity was up more narrowly from June and was 1 below a year earlier, the report showed. LAS VEGAS, Nev.

LP) The nation's supply of industrial gold is being threatened by the 54-day nationwide copper strike, a federal official said Wednesday. Dr. Walter R. Hibbard director of the U.S. Bureau of Mines, said about one-third of the nation's gold is produced as a byproduct in copper mining.

Hibbard, president of the American Institute of Mining, Metallurgical and Petroleum Engineers, when asked if the drop in copper production will affect the nation's gold supply, replied, "I don't see how we can avoid it." Hibbard was in Las Vegas for the fall meeting of the AIME's society of mining engineers. Hibbard said Kennecott Copper Corp. in Nevada and Utah is one of the nation's larger producers of gold. He said the gold appears in tiny amounts in copper ore, and when with current equipment and its applications and were out of step with the times." Drucker also said new managers usually are thrown by paperwork and by difficulties with employe interviews and evaluations. His comments applied primarily to salesmen and the move to sales managers, but could be expanded to difficulties faced by the new manager in any field of endeavor.

IBM attempts to smooth the "crossover," he said in an interview, through "graduate type" guidance of its Management Development Center. Every new manager spends a week at the center before he assumes his position. Attributes IBM looks for in managers, he said, are Intelligence, product knowledge, integrity, desire and "selflessness." Drucker said: "He must get his kicks out of the development and growth of others, not out of his personal Management Hard for Some guiding and reviewing. It appeared easier to go out and solve the problem myself." 2 They could not defeat the tendency to favor those whose method of operation was the same as the manager's. Comment: "I had to come to realize that salesmen don't sell or do things the way I used to.

Yet somehow, remarkably, they still seemed to get things done oftentimes, more efficiently than I myself could have." 3 They could not break personal relationships with former "equals." IBM, Drucker said, often solves this problem by sending promoted men to new departments or territories. 4 They attempted too tight control. Comment: "In my transition (to manager) I found at first a tendency to overcontrol actions to insure meeting desired goals. In short, I found it difficult to allow the salesman his opportunity to fail." 5 They could not boss older men. Comment: "I found that in some cases older men had not kept up.