Starting in the 1960s, corporate America went on a binge of conglomerate building. Companies pursued mergers and acquisitions with abandon, creating business empires that often manufactured hundreds of diverse products, from bread to computers. Many companies have begun to doubt the theory that management expertise in one field means success in another. Such huge combines as ITT, Gulf & Western and RCA have been selling holdings to streamline operations. Last week, in one of the biggest divestitures to date, R.J. Reynolds Industries, the second-largest U.S. cigarette manufacturer, took a back-to-basics step by selling its energy businesses to Phillips Petroleum for...
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