Danaher Backs Out of Cooper Deal

WASHINGTON AP Reported that Danaher blaming what it called a ``difficult business environment, backed away from a plan to buy Cooper Industries.

Danaher had made an offer for Houston-based Cooper in August, worth $5.5 billion in cash and stock, including the assumption of $1 billion in debt.

Even though Cooper rejected the offer, it signed a confidentiality agreement with Danaher that let it examine Cooper's financial data. Cooper subsequently set a deadline for a revised offer from Danaher, a deadline that Danaher ignored.

Danaher's interest remained, and the industrial conglomerate found potential asbestos liability connected to an automotive line Cooper sold to Southfield, Mich.-based auto parts maker Federal-Mogul Corp. in 1998.

Some of the products made for the automotive line, which was operated through subsidiary companies before Cooper sold it, contained asbestos, a known carcinogen. Upon the sale, Federal-Mogul indemnified Cooper for liabilities of the subsidiary companies and the automotive business.

Tuesday, Danaher's president and chief executive, H. Lawrence Culp Jr., said Cooper's exposure to asbestos liability was one reason the company dropped its pursuit.

``We are disappointed to have arrived at this decision. We continue to believe that Cooper is an attractive company that would fit well with our existing businesses. However, in light of the current difficult business environment and sensitivities with respect to asbestos liability, we have concluded not to pursue the acquisition of Cooper at this time,'' Culp said.

Shares of Danaher were down 40 cents to close at $63.89 on the New York Stock Exchange Tuesday, while shares of Copper were down 39 cents to close at $34.84.