A New St. George

At Pittsburgh's Duquesne Club, where steelmen gather for grub and gossip, few names have stoked tempers faster than that of Norton Simon. The California industrialist, who uses his Hunt Foods & Industries, Inc. as a corporate base for buying into other companies

(TIME cover, June 4), heated up the industry 15 months ago by moving into Wheeling Steel, the nation's twelfth largest steel company. In abrupt Simon fashion, he forced five directors off the board, tossed out the chairman-president, charging mismanagement, installed his own chief executive. Wheeling has since rubbed the steel establishment the wrong way by dropping out of industrywide wage negotiations and by giving customers when-they-order guarantees against price increases before delivery.

Last week, however, Simon was the toast of Pittsburgh. Reason: he had moved to head off a takeover by somebody else. For two weeks, Crucible Steel, a specialty company with $300 million annual sales in alloys, stainless, tool and carbon steels, had been one of Wall Street's most active stocks; Crucible's stock fluctuated over a ten-point range. Then the reason came clear. Headed by Chicago Industrialist Morris J. Rubin, who helped engineer a takeover 21 months ago of the U.S. Smelting, Refining & Mining Co., a Crucible-minded "Stockholders Committee for Better Management" was buying Crucible stock. Rubin and his committee said they were angry over low earnings and dividends.

Bunch of "Raiders." Crucible's management, struggling with outdated equipment and strong competition in specialty steels from front-running Allegheny Ludlum, was understandably alarmed and apparently willing to seek help from anyone--even including Norton Simon. Blasting the dissident stockholders' committee as a bunch of "raiders," President Joel Hunter caught a plane for California. Impressed by the way in which Simon had moved in to improve Wheeling, Canada Dry and McCall Corp., Hunter proposed that Simon--who knows the corporate-acquisition route better than he knows the way home from his own office--help block the invaders. Simon, on advice of friends at Pittsburgh's influential Mellon National Bank, accepted the invitation. Three Crucible directors stepped aside to make way for Simon men. Simon himself became Crucible's finance com mittee chairman.

At week's end, the outcome of the Crucible conflict was still officially undetermined. Much of the company's common stock, totaling 3,879,180 shares, is held in small blocs, many of which are listed only under "street names" in banks and brokerage houses. Neither side would state its share totals. Simon announced that Hunt Foods held a substantial bloc, may increase it by another 200,000 shares. Crucible's board voted to redeem 99,880 convertible preferred shares; since the preferred can be exchanged on the basis of 3.45 common shares for each one of preferred, the move would raise Crucible's outstanding shares to 4,223,760 and dilute the strength of the Rubin group.

What They Wondered. At the Duquesne Club and elsewhere last week, speculation reached beyond the immediate battle. Whether they liked Simon or not, most steelmen seemed to think that he had rescued Crucible's management from the proxy-fight predicament. What they really wondered, though, was whether the industry's new St. George might not yet seize complete control over the potential victim he had rescued.

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