Ling-Temco-Vought
Encyclopedia
Conglomerate (company)
A conglomerate is a combination of two or more corporations engaged in entirely different businesses that fall under one corporate structure , usually involving a parent company and several subsidiaries. Often, a conglomerate is a multi-industry company...
which existed from 1969 to 2000. At its peak, its component parts were involved in the aerospace industry, electronics, steel manufacturing, sporting goods, the airline industry, meat packing, car rental
Car rental
A car rental or car hire agency is a company that rents automobiles for short periods of time for a fee...
s and pharmaceuticals, among other businesses.
History
In 1947, entrepreneur James LingJames Ling
James "Jimmy" J. Ling , from Hugo, Oklahoma, was a US businessman and former head of Ling-Temco-Vought corporation. While at its helm Ling used LTV funds to purchase a large number of corporations, and was one of the more famous of the 1960s conglomerate managers...
founded his own Dallas electrical contracting business, Ling Electric Company, where he lived in the rear of the shop. After incorporating and taking his company public in 1955, Ling found innovative ways to market his stock, including selling door-to-door and from a booth at the State Fair of Texas.
In 1956, Ling bought L.M. Electronics, and in 1959 added Altec Electronics
Altec Lansing
Altec Lansing is a line of professional, home, automotive, computer, and multimedia audio products first developed in 1936. They were used in many studios as monitor speakers...
, a maker of stereo systems and speakers. In 1960, Ling merged his company with Temco Aircraft
Temco Aircraft
The Texas Engineering & Manufacturing Company , also known as Temco Aircraft Corporation, was a U.S.-based manufacturing company located in the Dallas, TX area...
, best known for its missile
Missile
Though a missile may be any thrown or launched object, it colloquially almost always refers to a self-propelled guided weapon system.-Etymology:The word missile comes from the Latin verb mittere, meaning "to send"...
work, and using additional funding from insurance businessman Troy Post, they bought the Chance Vought
Vought
Vought is the name of several related aerospace firms. These have included, in the past, Lewis and Vought Corporation, Chance Vought, Vought Sikorsky, LTV Aerospace , Vought Aircraft Companies, and the current Vought Aircraft Industries. The first incarnation of Vought was established by Chance M...
aerospace
Aerospace
Aerospace comprises the atmosphere of Earth and surrounding space. Typically the term is used to refer to the industry that researches, designs, manufactures, operates, and maintains vehicles moving through air and space...
firm. The new company became Ling-Temco-Vought, with a combined sales of $2.7 billion in 1969.
With low interest rates allowing the company to borrow huge sums, Ling proceeded to build up one of the major 1960s conglomerates. As long as the target company's earnings exceeded the interest on the loan (or corporate bond
Corporate bond
A corporate bond is a bond issued by a corporation. It is a bond that a corporation issues to raise money in order to expand its business. The term is usually applied to longer-term debt instruments, generally with a maturity date falling at least a year after their issue date...
), or the company's price/earnings ratio was less than that of LTV's stock, the conglomerate became more profitable overall. Given the fairly unsophisticated stock research of the era, the company appeared to be growing without bound, and its share prices rose. In 1964 Ling started a holding company
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
and established three public companies, LTV Aerospace, LTV Ling Altec, and LTV Electrosystems (later E-Systems, then part of Raytheon
Raytheon
Raytheon Company is a major American defense contractor and industrial corporation with core manufacturing concentrations in weapons and military and commercial electronics. It was previously involved in corporate and special-mission aircraft until early 2007...
IIS, and since 2002 part of L-3 Communications
L-3 Communications
L-3 Communications Holdings, Inc. is a company that supplies command and control, communications, intelligence, surveillance and reconnaissance systems and products, avionics, ocean products, training devices and services, instrumentation, space, and navigation products. Its customers include...
-Integrated Systems (L-3/IS)), mirroring the original companies that formed LTV. This action raised capital, allowing Ling to raise more loans and buy more companies.
In 1965, Ling added the wire and cable company Okonite. In 1967 they bought Wilson and Company
Wilson Sporting Goods
The Wilson Sporting Goods Company is a sports equipment manufacturer based in Chicago, Illinois, and currently is a foreign subsidiary of the Finnish company Amer Sports....
, noted for their golf
Golf
Golf is a precision club and ball sport, in which competing players use many types of clubs to hit balls into a series of holes on a golf course using the fewest number of strokes....
ing equipment, but also involved in meat-packing and pharmaceuticals. He later spun each of these divisions into separate companies traded on the American Stock Exchange; they soon acquired the trader nicknames "Golfball," "Meatball," and "Goofball," respectively. 1968 added Greatamerica, Post's holding company for Braniff International Airways
Braniff International Airways
Braniff International Airways was an American airline that operated from 1928 until 1982, primarily in the midwestern and southwestern U.S., South America, Panama, and in its later years also Asia and Europe...
and National Car Rental
National Car Rental
National Car Rental is a rental car company based in Clayton, Missouri. National was founded by 24 independent rental car agents on August 27, 1947...
, and J & L Steel
Jones and Laughlin Steel Company
The earliest foundations of Jones and Laughlin Steel Company were the American Iron Company, founded in 1851 by Bernard Lauth, and B. F. Jones founded in 1852a few miles south of Pittsburgh along the Monongahela River. Lauth's interest was bought in 1854 by James H. Laughlin...
. In addition he acquired a series of resorts in Acapulco, Guerrero, Mexico, and Steamboat Springs, Colorado. By 1969 LTV had purchased 33 companies, employed 29,000 workers, and offered 15,000 separate products and services, and was one of the forty biggest industrial corporations.
In 1969, investors found that the conglomerates were not growing any faster than the individual companies had before they were bought out. Share prices plummeted, sparking a bear market, and there was a general feeling that the conglomerates were to blame for the market woes. An anti-trust lawsuit was filed that year, and eventually the board of directors
Board of directors
A board of directors is a body of elected or appointed members who jointly oversee the activities of a company or organization. Other names include board of governors, board of managers, board of regents, board of trustees, and board of visitors...
demoted Ling in 1970, and he left the company, to be replaced by former LTV executive, Paul Thayer.
As part of a 1971 antitrust
Antitrust
The United States antitrust law is a body of laws that prohibits anti-competitive behavior and unfair business practices. Antitrust laws are intended to encourage competition in the marketplace. These competition laws make illegal certain practices deemed to hurt businesses or consumers or both,...
settlement, LTV sold its Braniff and Okonite components, and Thayer changed the company name from Ling-Temco-Vought to LTV Corporation. In 1975, after leaving the company, Thayer was involved in a suit over fraud in the sale of unregistered securities and was succeeded by former Xerox
Xerox
Xerox Corporation is an American multinational document management corporation that produced and sells a range of color and black-and-white printers, multifunction systems, photo copiers, digital production printing presses, and related consulting services and supplies...
executive Raymond Hay.
The company then went into a series of divestitures, most notably the entire LTV Aerospace division; the aerospace component retained the legacy Vought name as the independent Vought Corporation while the missile component later became part of Loral and later became the Lockheed Martin Missiles and Fire Control
Lockheed Martin Missiles and Fire Control
Lockheed Martin Missiles & Fire Control is a Lockheed Martin business unit based in the Dallas suburb of Grand Prairie, Texas. The unit's offensive and defensive arsenal includes air-to-air and air-to-ground missiles, naval rockets and missiles, fire control and sensor systems, fire support...
division. After the 1984 merger of the Jones and Laughlin subsidiary with Republic Steel Corporation, the company continued to exist primarily as a steel
Steel
Steel is an alloy that consists mostly of iron and has a carbon content between 0.2% and 2.1% by weight, depending on the grade. Carbon is the most common alloying material for iron, but various other alloying elements are used, such as manganese, chromium, vanadium, and tungsten...
producer, renaming itself LTV Steel, and moving its headquarters to Cleveland
Cleveland, Ohio
Cleveland is a city in the U.S. state of Ohio and is the county seat of Cuyahoga County, the most populous county in the state. The city is located in northeastern Ohio on the southern shore of Lake Erie, approximately west of the Pennsylvania border...
in 1993.
In 1999, LTV acquired Pittsburgh-based Copperweld Corporation
Fushi Copperweld
Fushi Copperweld, Inc. is a Sino-American public company based in Beijing, China. It was formed from the acquisition of an American wire company, Copperweld Bimetallics LLC, by Chinese manufacturer Fushi International in October 2007. The combined company is the largest manufacturer and supplier...
from Imétal S.A.
Imerys
Imerys is a French multinational company. It is a constituent of the CAC Mid 60 index.-History:The Company was founded in 1880 and for many years was known as Imetal....
of France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
.
LTV Steel filed for Chapter 11 bankruptcy on December 29, 2000. The assets were acquired and merged with Weirton Steel to form the International Steel Group
International Steel Group
International Steel Group was a steel company headquartered in Cleveland, Ohio. In 2004 it was ranked #426 on the Fortune 500. It was created after the turn around fund, WL Ross & Co. LLC, purchased LTV Steel in February 2002...
. Some of the railroad subsidiaries – Chicago Short Line Railway, Cuyahoga Valley Railway, and River Terminal Railway – went to ISG, while the Ohio Central Railroad System acquired Aliquippa and Southern Railroad
Aliquippa and Southern Railroad
The Aliquippa and Ohio River Railroad is a six-mile short line railroad in Aliquippa, Pennsylvania, United States, controlled by Genesee & Wyoming Inc. through its ownership of the Ohio Central Railroad System...
and Mahoning Valley Railway
Mahoning Valley Railway
Mahoning Valley Railway is a short-line railroad in Mahoning County, Ohio, USA, owned by Genesee & Wyoming Inc. It has an interchange with Norfolk Southern Railway at its east end. The west end is Youngstown Belt Railroad which is also owned by Genesee & Wyoming. This services Youngstown, Ohio area...
. The former Monongahela Connecting Railroad
Monongahela Connecting Railroad
The Monongahela Connecting Railroad or Mon Conn was a small industrial railroad in Pittsburgh, Pennsylvania, now part of the Allegheny Valley Railroad. It was a subsidiary of the Jones & Laughlin Steel Company and a large portion of its work was for its parent company, though it also served other...
is now operated by the Allegheny Valley Railroad
Allegheny Valley Railroad
The Allegheny Valley Railroad is a class III railroad that operates in Western Pennsylvania, and is owned by Carload Express, Inc.AVR acts as a feeder line connecting its many and varied customers to Class I railroads such as CSX Transportation and Norfolk Southern Railway , and regional lines...
.
In 2002, Lombard Metals Corp located in Bala Cynwyd, Pennsylvania
Bala Cynwyd, Pennsylvania
Bala Cynwyd is a community in Lower Merion Township which is located on the Main Line in southeastern Pennsylvania, bordering the western edge of Philadelphia at US Route 1 . It was originally two separate towns, Bala and Cynwyd, but is commonly treated as a single community...
, purchased all the outside inventory totaling 224,000,000 lbs of steel from 58 locations throughout the country.