(2 of 2)
Wall Street analysts say it would be a good mix for Hughes to link up with < an auto company. Detroit's carmakers, flush with record profits, have deep pockets filled with cash, $8 billion at GM and about $6 billion at Ford. They are looking for more defense business, as well as high-tech acquisitions. GM last year bought Dallas' Electronic Data Systems, a computer-services company, for $2.55 billion.
Hughes could also benefit from such a deal, particularly by using Detroit's expertise in high-volume production. One of the few blots on the company's record came from sloppy workmanship last year on its Phoenix, Maverick and TOW missiles. There are other benefits too. Says Hughes Chairman Allen Puckett: "If one of the auto companies emerges as the buyer, I think it would want us to continue developing high technology."
One bid put forward last week is certain not to emerge as winner. Karl Kaufmann and Robin Burke, both 21 and students at Harvey Mudd College in Claremont, Calif., submitted their check for $6 billion drawn on the bank account of the school's West Dorm. Profit from Hughes, said the students, would "fund various activities such as our annual Tequila Night party." One problem was that their checking account contained just $300.