BTR Dunlop Holdings, Inc. - Page 7




                                        - 7 -                                         

          to be inserted between 10 and 17 meters below ground.  It was               
          estimated that it would cost $1.4 million to level and                      
          reconstruct the factory floor.  BTR Dunlop, Inc. (BTR Dunlop),              
          was not made aware of these problems before it purchased Schlegel           
          Corporation in 1989.                                                        
          Economic Conditions                                                         
               In mid-1989, the U.K. economy was slowing, following a long            
          period of growth that began in the early 1980's.  Gross National            
          Product growth peaked in 1987 at a rate of 4.7 percent and                  
          declined to 4.3 percent in 1988.  This trend was expected to                
          continue for the following 2 years with a recovery anticipated in           
          1991 or 1992.  In 1989, the U.K. automotive industry was,                   
          however, in a position to benefit from the impending European               
          community integration set to occur at the end of 1992.  There was           
          concern that the resurgence of automobile production might not              
          help automotive component producers because many automobile                 
          manufacturers in the United Kingdom were using components from              
          abroad.  The U.K. construction industry had experienced                     
          significant growth in the years leading up to 1989, but, due to a           
          rise in mortgage interest rates, this trend was expected to                 
          decline.                                                                    
               The economic conditions in Germany in 1988 and 1989 were               
          good, with both the construction industry and automotive industry           
          expanding.  The automotive component industry was seeing signs of           





Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011