Shareholders witness end of long Hilton-ITT fight

Gary Thompson

Thursday, Nov. 13, 1997 | 11:10 a.m.

It was, as shareholder John Gilbert said, "a marvelous lesson in corporate democracy."

That's how the elderly ITT Corp. shareholder, one of two corporate gadflies who added a touch of levity to the serious occasion, summed up Wednesday morning's close of the multibillion-dollar battle among three of America's biggest corporations.

Millionaires and billionaires and a few plain folks packed into the sumptious St. Regis Hotel, consistently ranked as one of Manhattan's finest, to witness the end of the fight pitting Hilton Hotels Corp. against ITT and its friendly suitor, Starwood Lodging.

ITT Chairman Rand Araskog was subdued as he presided over what was likely the last annual meeting in the storied history of the one-time conglomerate.

Araskog, Hilton President Steve Bollenbach and Starwood Chairman Barry Sternlicht each knew that, barring a last-minute surprise, the biggest institutional holders had already decided which way they'd vote.

ITT's incumbent directors would be re-elected to consummate the friendly merger with Starwood, ending Hilton's 11-month takeover attempt and ITT's existence as an independent company.

But most among the overflow crowd were still uncertain how the final voting would go.

Midway through his scheduled five-minute opening presentation, Araskog was interrupted by Gilbert, who attached a red clown nose to his face and demanded a point of order.

"Mr. Chairman, I've owned ITT stock since 1929, when I bought it for 50 cents a share," Gilbert began. He then launched into a tirade, complaining that he hadn't received the annual reports of either ITT or Hilton.

Nearby, a disgruntled pension fund manager mumbled that he didn't come to the meeting to hear Gilbert spout off, prompting a brief argument between the two that Araskog patiently cut short.

Then, Evelyn Y. Davis, who for the past three decades has given her opinions -- most of them unwanted -- at thousands of annual meetings around the country, stormed to the microphone.

"I'm very sad about what's been happening," she lamented, referring to the fight between ITT and Hilton. "I'm a friend of Rand and I'm a friend of Steve, and I feel like a woman torn between two lovers."

Araskog peered at Davis for a moment, then said, "Evelyn, I'll yield to Steve on that."

Laughter rang through the meeting rooms.

"What, what did you say? I couldn't hear you," Davis shouted.

"It was friendly," Araskog said, a twinkle in his eye.