Document 5knLGVjxxY28EaK224xgpaggV

FILE NAME Allied Signal Bendix ASB DATE 0000 DOC ASB058 DOCUMENT DESCRIPTION Entry into Moody's Industrial Manual - AlliedSignal Inc. MOODY'S INDUSTRIAL MANUAL SIGNAL INC . CAPITAL STRUCTURE LONG TERM DEBT DebenDteubernteured9esb 28000s2001 1.00: multiplier notes Rating A1 A1 A1 A1 A1 A1 Debenture 9. debent9ur e 9270 s116997 10. % eurodellar bonds 2006 The Corp. 6 s 12. Bendix , % euroyen bonds 1993 13. UOP Inc. s.f. deb 6 s - A1 A1 Ai A1 daeeee A1 ai The Signal 14. The Signal Cos Inc.deb The convsubord 15. Cos Inc. vee Al deb 5" A2 mAmount Outstanding 29,848,000 29,025,000 100,181,000 109,734,000 63,108,000 99,890,000 100,000,000 200,000,000 100,000,000 100,000,000 18,825,000 99,000,000 1,219,000 12,457,0 012,457,000 8,121,000 Times Charges Earned 1986 1985 - 4.49 2.37 Interest Dates O 1 15 None D15 D15 eee ane N DIS D 1 May 15 Jan. Jan. 10 N1 S15 A15 Price 1986 100 017 7 99 -91 % 96-84 103-101 -100 89-78% -125 exchngbl A2 The Signal Cos Inc. 11 seoee A1 17. 18. Improv Rev. Bonds and note 19. ECanFpvoiriteriaoglnnicmzeuedrnrteanlcy leases 20. Foreign bonds . 103,428,000 125,000,000 136,000,000 148,000,000 | j= 190,000,000 | 106,000,000 J15 J15 Feb. 20 = Ff ...eee il ee ee 101-861 101-861 111 -106- CAPITALSTOCK 1. Common . 00... css accceccvcce $ Rating eons Shares Outstanding EB175,674,387 EF for Excluding current portion each Based each 4 shs held and one com FSubject to change stk purchase right for see text text held avg Earned per Sh 1985 1383.26 9783.28 Divs per Sh 1986 1.80 shs on continuing operations See text DAlso paid 1986 54 on~ sh Henley Group Inc. In Oct. 1967 acquired 50 interest in Daal Spe- Effective July 1 1979 AC Holding Corp. a sub- cialties Collingwood in Incorporated Del in 1985 as successor to a originally ,. company incorporated Interest increased to 100 manufacturer in @. under a perpetual charter i 1920 New York as Allied operated changed Allied Ltd. and Daal Specialties Collingwood Ltd. to June 1969. Now as Daal Specialties ( Canada Ltd. under direction of Automotive Sector sidiary acquired 94.8 of com stk of Eltra Corp. a diversified of electrical consumer and industrial goodsfor 51.50 share On Nov. shares outstanding DyeCorp Chemical name of was about Apr. 1958 name AlAllileided1u985pon acquisition present partnership Angeles its plants General Gfuolrfmed Calif Apr. 27 1981 to name The On Mar. 2 1970 company and a Atomic Co. subsidiary a Gulf Nuclear Services partnership struction and operation of a Oil Corp. formed Allied the con- fuel recovery Total cost acquisition In July 1979 Co. sold 598,000,000 its Thermosets Business in Toledo Plaskon Products ComcpoantnrioelsJeIrncG.seeynecForenabsl.olidate by incorporNatAedamteiroincaanl ducerwiestahrDluytaScScccaqlahluolSpKioheplrleiSdphelplasnhuCtompdanoAiteowsmicnCoSmpuanbisesewqiuetnhtlpylasnotlsd ObcuohsailineosseswLhosich Sshubasnenquoenntly rated ChemCihcaeYlmoifrocrkmIaednltc.oJuly Semincoerporatted incostrpotoraotedckincorpo- Royal and in Mich 1979 Branitcsh in 1982 Solvay Co. Originally formed by owner plant at Barnwell S.C. ship the The Barrett Co. incorpo- In 1971 group of small seat belt pro- Sept. Co. discontinued operations in rated in New Feb6. 1903 called paving materials and certain other 4 Products ' Co.in 1915 2 changed The Bar- Germany France Chemical zerland sold Sweden and Swit- Co. In Gulf Oil Corp. went into partner- materials resulted in the sellbusiness the Detroit Feb. 15 1899 and Ashland Ky coke plants Moundsville Co. Inc. 4 New ship ShNelluclear Inc. a subsidiary of the South plant and , in ProcessYork incorpo- d transfer Group Harewood W.Va. a Nuclear interest in Atomic mine and of the acquisitions General change coal to Armco Scallop incorporated Nuclear which in a name change mine Inc. General sald chlorine plants Inc. to General Nuclear Services AGNS In Dec. 1979 . . Semet- venture process subsequentiallcyosting belt International automotive seat Busi- Atomics Investmentin AGNS was subsequentially Nuclear transferred to Valley Pines Associates as ship between Gulf and built a plant SacatlloBparnwell S.C. partner joint approx 250 million to used nuclear fuel from nuclear power plants The Barnwell plant automotive Linden Chemica&lPlsasticPs lastics Inc. Jan.1980 Co. acquired new Toric manufacturing facilities Toric AccessoriesInterational a 50 Klippan thru acquistion Ltd. England which was : and ; atomic year Nuclear system subsequently Prod with processing capacity of 1,500 metric tons of . system spent spent fuel per is mutually owned by system Pines Associates and a wholly sub the Co. Allied Chemical sidiAarcytiIonncs. . by the federal government have had the for common acquireCd orp Apr subsidiary effect of preventing AGNS from obtaining the nec- remaining essary licences to the facility the operate rremaieninmg aining Mergenthaler GMBH does favors of % minority Linotyopfe current administmarnaagteimeontnmanh agema entsstatendotthabteliietve that Echborn private operation of the Barnwell facilityis feasible practicable private Franken an ounced Canada commercially establishedan 87,000,000 after operating practible annoBiuo ncLeodgitchaels private compa- Bio reserve for the write and eventual shutdown of In subsidiary of 1980 Eltra acquired interest inone its West BBI Franken a started equity biotechnology Mexican first Toronto 1980 aluminumsul- In 1959 company and international be in plant for production of uranium saleunprdievr from for ately 198a1 acquirseudpplier of alinutmerestthe ^"raniumcDo2n0ceen1lt9r6a2tes at Natural management a 49 in for Atomic Energy Commission acquired Union contract Texas the AGNS facility However AGNS continues to believe that the Barnwell plant is a national international asset that should used by Governmentin the of high level radi- the fate market through a 49 S.A. leading equity investment oactiveoactive wastes filed for In Mar. 1983 AGNS a lawsuit against the excess of Alkamez S.A. In Sept UnioFnibers Division seeking dgaomvaegrensment's completed Bunker Texas Petroleum in in July acquisition formed fiber Federal government inducing 19819811 approximately in 1963 for for 500 million as a result of the In of sal in 1977 of itslong lonsg tandingstanding of inducing Ramo policy reproces of 347,000,000 series in new cash and private sector the nuclear C pfd stocnok tes : -- acquired Southern oper- AGNS acquired interest shares Co. business July in Now govern 1981 sing common shares Now oper- AGNS contends that the - Also in . a % change by Union ated as of ment's actions in effect constituted a taking over part subsidiary supervised acquired 1981 Apollo Lasers a Inc. Petroleum of the AGNS facility for public without just In Aug Teras for assets of Polymer in violation of the Fifth Amendment manufacmtanuurfaecture of industrial and scientific lasers compensation acquired generally in of W.R. PolymerPolymer government has filed aproximatelyapproximately 8,000,c0 om0 mo0 n stock -- Division General denying ailegations 311,000,000 Co. denying AGNS and answer for Chemicals Aerojet and General denying and has a motion In Oct 1981 Fisher Scientific : approximately $ form jointly to D In in Nuclear jointly owned Idaho thelawsuit May 1984 AGNS filed a motion seeking stock cash new series jointly for Corporation for purpose Corporation managingTesting acquired Corporation station the & West Coast National Reactor judgment that Government's 1977 actions con- In Oct. 1981 stituted a Refractories portion of contract which of the Barnwell plant as a mat- and MineralMineral Division of taking Corp Interpace ter of law and for the to dismiss the Gov- June Court late In 30 the the U.S. Atomic Energy ernment's 1981 acquired Gyrex Corp. expired June 1971 under motion . In May Corp. was reorga- : acid 1969 Corp. N.Y.and Chicago sold sulfuric toluene disocyanate diisocyanate from In Oct. 1977 acquired Gardinier Big River toluene interest General Chemical with Petro owned by French Moundsville assuming Petro West and its in Ark ammonia and Chicago leum sharing Allied the remainder and Inc. a co plant Helena interest The plants an principal principal N.Y. plant at Moundsville opera- , diisocyanate Moundsville West Va and its two oil and in sole tions shutdown operating contract were affiliates 1982 in early gas covering acid Reactor Testing Sta- procesing National include sulfuric production of pipeline assump plant and related activi-activi- In Apr. 1978 Co. psipeline old to Tejas Gas Corp. the Winnie 7,000,000 Purchase the Dispositions1982. a in NewellNewell RubberRubber and marketing of athletic was cash and combination did not renew this contract price was a combination footwear Stanley tion by Tejas of certain obligations of Co. The sale Flagg Co. of 1979 1966 manufacturer manufacturer manufacturer Textiles Co. Borg 50 interest in Jim includes the mile intrastate leased pipeline con- brass of acquired Robbins fittings Seat was increasedincreased to on tracts sale contracts and transportation agree- various Klippan ( knittkneitde deep pile Process Seat Belt , 1967 merged ments Cos subsidiary Cable Jim Corp. foburilding Walter merand business to into Co. on Oct. 31 1974 sold Walter Corp. for$ materials cash its Sept. 1978 Co. sold vinyl chloride mono to ethylene facility in Baton Rouge La Selexol and Independent of Prestolite Wire In Apr. 1982 acquired Supron Energy Corp. and for 46,969,169 preferred Corp. which which | were sold in shares Apr. ICI Americas Inc. In May 1979 Co. sold its plant to Ashland Oil Inc. South Point Ohio domestic producing Supron's properties Pursuant to agreement Supron's oil and gas properties were transferred to a partnership jointly owned and 4 AS 16.02 s ener NRA, WR et Are ee we ae % : H Tbe 10 MOODY'S INDUSTRIAL MANUAL operated oCfompuanrychase Group Inc. Co.'s of In Dec. 1982 acquired approx 39 the standing common and The Continental price was 357 39 of million out- stocstkock Martin Marietta Corp. from The Bendix Corp. for approx 301,000,000 301,000,000 In Aug. 1983 Martin Marietta Corp. repurchased 1.8 million shares of its common stock from Co. for 95 Martin remaining million Co.'s Marietta common stock 6,981,7560 ,981,750 shares of were repurchased Jan. 1987 Co. sold to Henley Investment in Henley of convertible its remaining preferred for 465 million On Mar. 31 1987 Co. announced it had com- pleted the sale of Allied On June 191987 completed the divestiture in its electronics and Linotype Co. Co. announced that it has of the seven businesses intrumentation sector Total proceeds from the seven businesses were 1.8 bil lion in cash amounted to 2,477 million unfilled orders Funded 31 were 4,861 million at Dec. 1986. Including con- have tracts for which funds not been committed the backlog of unfilled orders at Dec. 31 1986 for products and services was 5,437 million Electronics and Instrumentation Sector The Company's electronics and instrumentation sector consists of the following operating units Ampex Corporation Amphenol Corporation Allied Lino- type Company MPB Corporation Revere Corpo- Marietta on Oct. 31 1983 for about 250 ration of America Sigma Instruments Inc Nep- million million Martin SUBSIDIARIES its acquisition of The Bendix 1983Bendixcompleted following significant ) Bendix is a diversified company Bendixreported Corp. which in 1982 its operations pri- significant sAilglniifeidcantCorp. marily in the following business segments automo- Signal tive consisting of systems and components for the Ampex original equipment and replacement markets aero- electronics consisting of products and ser- vices for the aviation markets and defense and On Dec. 31 1986 held or controlled significant subsidiaries Signal Companies Inc. Signal Canada Inc. Ampex Corporation The Garrett Corp. Note Co. also has numerous other consolidated space programs industrial consisting of machine subsidiaries which are primarily totally inditools and accessories for the metalworking indus- rectly by the Co. which if consideredin the aggre- tune International Corporation and Inc Endevco Corporation The Co. has offered for sale all these business except Endevco a manufacturer of sen sors and transducers that measure vibration Ampex manufactures professional audio systems and recording tape for broadcast and production applications tape for record mastering and data storage instrumentation recorders and core memory systems for government applications and video display terminals for the computer industry try other products share of common and electrical stock of Bendix outstanding on Jan. 31 1983 was converted into 0.25 of a share of new series F pre- other ferred stock two separate series of % original com ercial equipment issue discount notes and shares of common stock The aggregate value of the transaction including the purchase of approx 55 of Bendix's outstanding common stock from Martin Marietta including textiles was approx 1.8 billion In Mar. Alloys assets of 1983 Inc. acquired substantially all the for a total consideration in cash and shares valued at approx 97,000,000 Alloys was a manufacturer of components gate as a single subsidiary would not constitute a significant subsidiary BUSINESS & PRODUCTS Company's operations are conducted under three business segments aerospace electronics automo- tive and engineered materials Co.'s products are used by many major industries refining steel construction petroleum and petrochemical plastics electronics automotive chemicals housing telecommunications packaging military and commercial aviation and aerospace and in agriculture and the space program Amphenol produces a full line of elec- tronic and fiber optic connectors for military aero- business other commercial telecommunications and industrial applications as well as associated cables cable assemblies and interconnection devices Linotype designs manufactures sells and services composition products and systems worldwide through direct sales organizations and distributors to the graphic arts industry Composition products include text entry and typesetting devices and computerized data bases in a systems environ- ment reliability for semiconductor packages MPB designs and manufactures a complete line In Apr. 1983 acquired Instrumentation Labora- Aerospace bearings mechanical electro- precision pulleys of and tory Inc. a maker of biomedical and analytical The electronics segment is comprised which includes the optical assemblies spindles idler pulleys and Allied instruments for a total consideration in cash and of the aerospace sector sprockets test equipment for instrument instrument bearings common stock valued at approx 115 million controlled operations In Dec. 1983 Co. discontinued its Bendix and Garrett aerospace business and the and electronics andinstrumentation sector computer in Revere is machining systems in the design and manufac- operations Aerospace_segment machine tools and liquid fertilizers provides products and ser- ture of measurement and agricultaussreatls liquid Aerospace_segment Aerospace_segment weigihnivnoglved all temperature Sold substantially machine tool vices primarily for military aircraft civil air trans- and missiles electrical and fluid sensing instruments , andthe agricultral business in April 1984 in fertilizer business June 1984. agricultural liquid port and general aviation markets and spacecraft oceanics and command and intelligence control The Sigma Instruments specializes in the manufacture of electronic electromechanical control systems UnimUanimrar Co. communication In Sept. 1984 a partnership Bendix programs business is comprised of of and sensing equipment electromechanical switch- general AlliedAllied consisting of Company and aerospace the Aircraft Systems Co. and Elec- ing devices stepping motors and electronic motor completed acquisition Ultramar PLC the international oil and of companies tronics Systems Co and power sensing testing and control Corp. an gas com- ENSTAR controls Co. share of the cost of the acquisition Principal products of Aircraft Systems Co. are acquisition was valued Neptune's at approximately 153 million airborne weather avoidance radar systems aircraft Neptune's fluid residential water and control used in prodhous- communications include meters ucts In Nov. 1984 Co. acquired Amex Systems Inc. and automatic flight control systems motion and ing industrial flowmeters used measurement liquids aerospace company for approximately 45 mil engine air data flight instruments systems navigation and sensing identification of a wide variety of and gases anliolinon equipment rily industrial prima- In Dec. 1984 Co. one of its opera- electric power generating systems igni- tion and fuel control systems aircraft wheels and automatic reading and billing systems used with residential water meters linked by discontinued rily tions which 1984 be discontinued brakes to in 1985 brakes test systems electromechanical and telephone lines or cables to a central television In Jan. 1985 Co. completed the of components industrial control systems acquisition hydraulic computer system Radio for approximately 110 million and ignitioncomponents and checkout equipment TKiIhnngeApril Corp with subsidiary aproximately its merged , Co. Products of Electronics Systems Co. are cryptoidentification of friend Automotive segment primarily supplies systems Bendix Petroleum fuzes and In 1985 of interest in graphic equipment systems radar and components to and foreign manufac- and soldHoldings Inc. proximity spacecraft ppaasengerspsaesnsegnegrerdocmaresstic medium Inc. the Com- gyro- turers trol systems for land vehicles and spacecraft light vehicles and heavy SS antisubma- trucks and also pany's oil and scopes for tactical missiles and aircraft antisubma- supplies a completed tender and vehicles replacement On Aug. 6 1985 a rine warfare systems range instrumentation and of oe variety equipment offer for 22,000,000 shs Companies ground surveillance hel systems equipment care principal eqiunicpmleundte discproducts for trucks drum and trucks dismcaster drum meteorlogical brakes systems chemical detecting brake boosters instruments engineeringengineering friction instruments derst systems , and materials pGraporroppreturtbotfan deveturbloshafot pesngines manumfaancatgureemsent systems f^...rboorcahakrignergs componentscomponents restraints designs turbo- plugs f^...roochargersand engisnaefety turbofan turboshaft systems and ooff gas turbine including turbo- con- turbofan turboshaft for use as and asemblies and cleaner engine controls for commercial industrial and mili- heat exchangers elec- cooling fans power systems tronaiicrsmanufacturers asemblies medium trucks : prefered Each used applications sauyxsitlieamrys alsliadckncrdumofafnd vehiclecsomponperonvtisdes of the preferred stock one share Ccoonmvperatneydconvtertd hientporefeprrerfeerded 82,419,682 stockshasurbestsanCtomipaalnylCySoigmnaplasnyimilar slack adjusters air dryers clutches cruise 82,419,682 stock and ccomomonmmon materials and turbochargers and 7,36,517 7,336,5177,336,517 shares holderists cbompnets preferred stock preferred fofromremrer holders Aftermarket usiness mon and prefered Navy's items its common stock antisubmarine ferred stock to former holders common torpedo nexgteneration United and preferred stock formed19Al8l6iesdoSlidgnNaolrtInhternational Garrettcontrolsystems In In Dec. 1985 Inc. Jan and Feb. } American marketing Refractories Co. and D was a of its various series holders of Allied com 91,676,750 shares of 898,028 shares of its pre- of Signal Power Systems Aprilof 1986 Prestolite Prestolite a special dividend pneumatic Fram and 1 common stock approximately Inc. share new 35Inc. 27 , common and company paid a special , the Henley consisting dividend of of approximately approximately units of Allied Corporation the former business units worldowipderations Signal Inc. for each 4 shares of stockheld services of sales the common of record on May 16 1986 products Henley The Co. retained preferred stock of after 15.6 dividend power Henley after Fluorine four of equity givgiivningg effeecqtuietqyuiSatyntvdootcivontkigng bilion offering aircraft MaterialsProdSupcectisalty Products Henley Common above power orepfresenting Henley after public of units Fluoropolymer built productssulfur June 1986 sold the business hydSroFfl6uoric unitsMay 1986. Co Materials Group of in acquired leader products for 152 in cash Oak Inc. million Industries In ; Co. offered for sale seven operat- ing Dec.that make the Electronics and Instru- units cryogenic Fluorocarbons up mentation sector included the aerospace elec- for originaloriginal equipment tronics segment The businesses offered for sale Ampex Engineered are Allied Corporation Amphenol Corporation Linotype Company and the supply Components Group including Corporation Neptune International MPB Revere Corpo- Corporation ration of America and - Instruments Inc. The combined 1986 sales for these businesses were about 1.5 billion net income was 54 million and producers total assets were approximately 1.4 billion used applications Garrett gas turbine engines are for primary propulsion and as power to operate propulsion systems electri- cal systems and environmental control Garrett continues to fill production orders for a variety of other secondary power systerns many of them for ground military applications torpedo Garrett is also expanding its activities in undersea propulsion andis developing an advanced technolturbine propulsion system for the US lightweight torpedo are used on a large p^'r- of centage the world's commercial airliners as well as on many military and general aviation aircraft These systems include air conditioning and pressurization The Garrett environmental control sys- tem supplies conditioned air for cockpit and avon- ics cooling Garrett also produces control systems to govern engine speeds and tem- peratures and actuators for such components as ntizherrsnuiszetrs rev*- ersers trim controls and engine synchro and Garrett's other aerospace include transfer equipment which is used in most of today's commercial airliners and military avi- aircraft and a number of business and general avi- ation Garrettis also a leading producer of aircraft engine oil cooling systems having the first contoured surface oil cooler OtherGar- Gar- rett heat transfer products include electronic cool ing systems cooled mirrors for high lasers and infrared radiation suppressors Garrett also has term experience in cryogenics both components and systems Major programs design and manufacture of miniature cryogenic refrigerators liquid nitrogen cooling systems commercial aircraft galley refrigeration and sys tems which hydrogen and oxygen reactants for spaceborne fuelfuel cells Garrett pioneered in developing supercritically cryogens for . spacecraft applications For the year ended Dec. 31 1986 sales to the U.S. Government acting through its various departments and agencies and prime contractors and heavy road Co. air and hydrau- actuation air and hydraulic brakes adaptive braking systems air dryers fan diagnostic con systems friction turbochargers and heat exchangers and steering componentsturbocharges includes replacement parts for most of above and air oil and fuel and wire and cable products Automotive operations are located in the States Australia Brazil Canada France filters West Germany India Italy Spain and the United Mexico Japan Portugal Kingdom Distribution and are conducted in many other countries well Products are marketed under Bendix Autolite and other trade names For year Dec. 1986 worldwide passenger and truck equipment sales accounted car for and original of automotive net sales with segments aftermarket % sales operations outside and sasalleess the US accounted for worldwide Engineered Materials Segment is composed of divisions Fibers Plastics and Performance and FluorinheydProrfoludouricctMas ajcorMiajdor HF are fluoro- hexafluo ride SF6 and uranium hexafluoride UF6 Co. is world's largest producer of and in industry derived in production and sale of products from HF are sold mainly as refrigerants to equipment and replacement manufacturers air conditioning and refrigeration equipment and as solvents in precision cleaning applications such as electronics optics and aerospace applications which Co. processes uranium ore concentrates into UF6 which is an essential intermediate in produc- tion of fuel elements for nuclear power reactors for domesticand foreign customers The Co. is one of two domestic of SF6 a gas used by utilities because of its electrical produc eactors cers cers of lectrical MOODY'S INDUSTRIAL MANUAL 11 properties in circuit breakers latory switches 4 and electronic minisubstations insmision lines ; Plasticsand TorTorrarnancce Ala NewportNews Can Torrance Performance Materials Major plas- Torrance Newport products density polyethyl- are Paxon - fordrums pailpsails bottlesbottles food contain- and housewares and automotive City Cal Sao Paulo Brazil FostoriaOhio Joseph tegic Applications Cfi shes products for floor Sumter S.C. additives and rubber engineerpeeddolengiynpelreeadsttihcylene additives textile Henley plastics finishes and Electronics industrial variety of plastics which applications are for a Towson Md products include binder pitch for electrodes Hollywood Phoenix and carbon industries creosote oils aluminum Ariz Mo. industry for oils cacarrbbononproducts preservatives Mo. Eatontown black market or fuel markets refined as Henley napthalene chemical intermediates driveway and additional Alliedmillion Nealer tar for roofing pitch for the construc- Sidney N.Y. AlliedAllied Signal Allied industry andmarkets Engineered engineering Jacksonville The group manufactures plastics and packaging markets CapronoCaprono nylon Bend engineering plastics pClaapstriocsn nylon thermoplastic represented Caprono markets consist of a film film and Aclair numbenumberr of custom Opelika Ala Compton North Cal Hollywood Cal NLorth os Sylmar Cal Cal Torrance Cal Teterboro N.J Fort Lauderdale Fla Jacksonvile Olathe - Fla South Ind Leased Automotive * We expanded our network of regional business . Va W. Germany development offices to include China India and Singapore which extends our reach into those emerging markets and furthers our globalization St. Joseph Joseph Mich * And we completed the spin of 35 stra- Greenville Ohio Jackson Tenn businesses to The Henley Group Inc. a move that amounted to a billion dollar special div idend of stock for our shareholders In Columbia Md . addition the Corporation realized million and ? retained 19.5 million shares of Henley preferred stock Kansas City Tempe Ariz lTucsAozn N.Y. Colorado Springs Cola South Montrose Pa Eschborn bei Frankfurt Germany In January 1987 we sold those shares back to Henley for 465 million and we adjusted several support agreements for which paid Allied- Signal an All of these trans- actions resulted in ers receiving value and its sharehold- 1.9 billion We believe this sum exceeds what we might have realized had we sold the 35 businesses each on an individual basis The Henley spin represented another major step in our seven from a cyclical chemical and gas company to an advanced large film fabricators manufacturers of power tools appli ances electrical connectors automotive and industrial parts the meat and food packaging industries Owned by U.S. Govt and managed by Co. Partly plant technology enterprise For those of us in manage- ment 1986 was particularly gratifying It was the year when the new company we envisioned back and special aerospace applications Specialty Products The division is composed of three principal businesses Norplex Division Oak Frye UOP Inc. and 1 Norplex Copysystems Inc. manufactures circuit board lami- Union Texas Petroleum Union Texas Petroleum Holdings Inc. Union Texas had been a wholly owned subsidiary of Co. until year 1985 when Co. sold interest in Union Texas Union Texas 50 is engaged of engaged in 1979 actually emerged a dynamic enterprise prospering through strong growth businesses serv- vital industries worldwide ingWe have come a long way in altering the profile of the organization whose salesin 1978 were 3.3 engaged nates for the and electrical industries in oil and gas exploration development billion and whose total investment in research and electronic petrochemical line includes copper clad duction natural gas processing and development D was 58 million That year 87 product manufacturing was laminates usedin computer tel- percent of net income derived primarily from Instrumentaion and two foreign oil and gas joint ventures with the bal- plastic laminates used holds leasehold military Union various interests Texas contract or others producing oil ance from commodity chemicals fibers and plastics ap lications designs the United BritiSshec- chemicals applications and licenses process technologies properties locatedin the States British as well as a small automotive seat belt operation Spain the and produces for petroleum and refining tor of the North Sea Argentina several Spain Pakistan businesses were losing money involved in the Com- including and food industries and Indonesia Additionally Additionally Union Texas has vari pany was major litigation opinion UOPprocessingcadtesiganedpleytsrtoschemical has licensed more than100 ous interests in or rights to conduct exploratory series of caves that prompted a qualified opinion designed and from its units located in over 85 nations including activities on undeveloped acreage located in the independent accountants and a down- processthtahatt upgrade gasoline break down petro- States and 6 countries throughout the grade by the major credit rating agencies was a those grade United components into gasoline or distillate pro- world distinct possibility In 1979 embarked on our 5 duce base materials for the manufacture of deter- Union Texas has 37.81 interest in joint ven- ambitious course We discontinued or the high quality diesel oil jet fuel and ture whichis developing oil and gas fields in East unprofitableoperations resolved the major qualifi- from heavy oils and parax- Kalimantan 20 interests in both tion to such an extent that the accountants qualifi- produce pure Indonesia and Claymore UOP also provides diverse engineering ser- Piper and Fields in the British of cation was lifted accelerated & spending and Sector and technical assistance to its customers and the North Sea launched an aggressive asset redeployment pro- interest manufactures a wide range of catalysts and At Dec. 31 1986 Company's % in gram over the next three years buying various to to the specialty products used in the processes that it Union Texas worldwide net proved reserves were estimated to be 69 million barrels of liquid hydro- companies gain access electronics mar had targeted as high potential censes carbons crude oil condensate and natural gas The first major acquisition was Bendix in 1983 Copysystems trillion only is a producer of time car- liquids and 1.1 cubic feet of only augmented our electronics capabilities business naturalgas butnot only paper for forms and information sys- . provided provided our entry into the aerospace indus- tems provided Properties and of carbonless reproduction paper Frye Other Properties It madeus one of the largest independent development suppliers Copysystems also manufactures products for the An administrative and research and to the worldwide automotive industry development Township Computer market Major products include complex is The 1985 merger with Signal added the critical supply located Morris 100 other at 100 agnetic ribbons and process addition there mass we needed needed to become an even more impor- . encode encode laboratories approximately primarily research cks and other financial docu- facilities which tant competitor in aerospace markets while also and films oarnddersffaabbrriicc the automotive computerized adding strengths to ribbons for printing provide direct support to operating segments+. word Company owns or leases warehouses airplanes sectors our and engineered films information restructring information systems FryeFrye systema markets products Impact It also and restructurinresgtructuring through In stafs bewildering its 1987 the company announced that it has railroad cars bargesautomobiles trucks material handling and data processing equipment leases space for administrative staffs ; -_ Although our so many acquisitions and divestitures was fastpaced andand perhaps . to some it did give us the footholds in technol- opportunity to establish red Expenditures 2000 for sale the Frye business Capital in way opagvye to principal matheyrdiarlosfilnuwcoolrruielrtdhycdleeen'esmcsiactuunemresimnaeles naend ethylenegas engi- OLfafndfumiitmuprerov equip copmropducot site compbaencyoming maonuyr Co.nylon fluorogceanrebroanlstletyrachlosriudelfur CMoanscthru&ctieoqnuipseingieegesd aede It the more thatpercent Pe, the 50 the top seven : is raw include Copysystems used in the are natural gas sulfur flu- acid carbon tetrachloride and coal of & oe od ree) .. equip . Feta & 1ie Transpor equip se in in IInndustries dustries Those initiatives helped the our becoming what we are today composite of very a three areas with of old Allied Benis focusedin world positions in Company lines And the is well balanced takes ity contribution of of businesses to income busineses och tay provide i + third largest world's largest producerthe United progress Aerospace Compbaunsyinesses aarree part our new producer of nyloninproduceUrnitoefd ; olactam primarylargest domestic -broadest systems aero- for nylon produces fine and STOCKHOLDERS to heavy denier compounds and film to stockholders trademarks Anso Inc. wide range Caprolan Fine deniers Caprolan military 1986 for use in manu- Company's Annual stockholders Heavy deniers are apparel Corporation's industrial fabrics seaitndustrial excsiencle lenexcelentt year for Signal November fabrics cordage automotive belts and tire cord In addi- automotive Co. produces heavy denier polyester yarns are used in seat significant cord -!~ highs engine red aeraoersopspaaccee previousoplery- Net Sources of Revenue by segments sales growth strong andthe lars segments follow in millions of 1 Total .... reek r part ofof | LETTER TO t The following is the letter Edward L Hennessy Jr. Chairman Executive Officer Allled which one product lines in the entire space Industry ranging from Bendixprimary electronic- cockpit avionics to Garrett primary propul- for to of subsystems subsystems andcomponents for 1986 appeared in . : excelent To Our Shareholders 1986 was an . In year the first full since the merger with The Signal Companies Inc. sales and income from our aero- space and electronics automotive and record materials businesses reached a relatively in economy in highs the United States cles spacecraft electronics weapons percent to the undunderseea rsea businesses In our contributed 52 sales and 52 percent to its in L. of very ation more responsible for net income The creation 1986 this the Robert Kirk to lead it- a move for us Kirk a sucesful aerospace oper- key in our industries dollar's value in of our decline of the 30 years mmaraketrs kets head the He will spear- Allied growth of Signal's aero- . boost some overseas further complementary which helped limit imports on the which helped boost exports and contracts space interests Rev. we won valuable valuable new that will 1 Bendix and Garrett to advanceour 51 3,593 reap rewards theCorporation into 1990s participation rapidly 24 2,428 operating were partially andGarrett 2,081 substantially the partialy [ 1,013 the for 39 in a changing 27 beyond .. . Beg industry riank participation results we have 23 The outstanding With Bendix an excellent EL offset by reduced profits from our base on which to build this new company and over and gas interests as of crude declined time we expect to accelerate the process through the price ..... amounts 11,794 100 9,115 100 Although disappointing situation emphasized carefully selected acquisitions that will further Includes amounts for businesses sold and the wisdom of our strategy to reduce our exposure market expand our market or fill product or Union Texas oil gas income produced affiliate recently penetration the Co.'s and & as in oil and gas which as 43 of the Corporation's netincome _ technology gaps - Growing our automotive and engineered engineered materi- percent marked 1986 the kaleidoscope of events that als sectors also high priority These operations PRINCIPAL PLANTS PROPERTIES laboratories central is a operates , research laboratories and operates throughout growth 29 respectively Compafnacyilities laboratories the Corporation and research of percent Com- and are generally located to serve four were to the achievement of our goals each provided 24 percent to our 1986 sales and 19 to accelerate the improve its profitability We created the income : > a to our operating net large Europe provide Signal Aerospace Through global ofplants areserving of network marketing areas and accessibility centers busineses Fraw materials and labor pools Principal ppllanats unless vehicle manufacturerserving the fee industry's of owned in which are pany appointing one the industry's most cal ble executives to the potential our automotive major the . systems turbo- nts businesseswe acquired through mergers aerospace and aerospace world providing advanced indcated are as follows Engineered outsourcitngoday Materials bush automakers Hopewell Va oan Shreveport Pa phototypesetting Shrevport Shreveport S.C. Shreveport phototypesetting Chesterfield Va with The Bendix Corporation and Signal We offered for sale the seven diverse nesses of the Electronics and Instrumentation Sec- tor which among other products manufacture con- nectors professional video recorders - and equipment to streamline our portfolio and sharpen our focus on our primary operations and electronic systems components With ment market a key trend in the original we continue to collaborate with automakers automakers in the development of technolo- gies for their vehicles of tomorrow increasingly using computerized design engineering and manu- facturing methods to supply reliable quality competitive products