WALL STREET STOCKS/TENNECO INC &lt;TGT>
  Tenneco Inc, a company that has long
  been rumored to be a takeover candidate, rose sharply today
  when speculation surfaced that investor T. Boone Pickens may be
  targeting the company for an acquisition, traders and analysts
  said.
      Tenneco spokesman Joseph Macrum said "we have no comment to
  make whatsoever." Pickens was not available for comment.
      Traders noted that activity in the stock increased today
  after a published report linked Pickens to Tenneco.
      Tenneco rose two points to 48-3/4.
      Paul Feretti, an analyst with New Orleans-based Howard,
  Weil, Labouisse, Friedrichs, Inc, said he was not surprised at
  market rumors that Tenneco might be the target of a takeover
  attempt.
      "It's pure market speculation that Boone Pickens and his
  group may be interested," Feretti said.
      "But Tenneco would be a challenge to run because of its
  sheer size and diversity. Mr. Pickens is a man who likes a
  challenge."
      Pickens, who made an unsuccessful attempt to take over
  Dallas-based Diamond Shamrock Corp &lt;DIA> last winter, has made
  no secret of his plans to acquire additional natural gas
  reserves in the belief that gas prices will stabilize sooner
  than oil prices. Tenneco holds natural gas reserves estimated
  in excess of 3.5 trillion cubic feet, analysts said.
      Feretti conservatively estimated Tenneco's breakup value at
  58 dlrs a share and said the company generated a cash flow of
  about 10 dlrs a share "which is probably very attractive to
  Pickens." Other analysts, however, estimate a breakup value
  well into the 60 dlr a share range.
      "I strongly doubt that there is going to be any hostile
  takeover," Drexel Burnham Lambert Inc's Houston-based analyst
  John Olson said, putting little credence in the rumors.
      "Tenneco is a gargantuan enterprise with seven billion dlrs
  in long-term debt and preferred stock outstanding." He said the
  buyer would also have to deal with "the intractable problems"
  Tenneco faces with its farm equipment unit and energy
  businesses.
      Analysts suggested that Tenneco could use a number of
  defensive strategies to fend off an unwanted buyer, such as
  spin off some of its non-energy businesses directly to
  shareholders, buy back shares or create a limited partnership
  out of its natural gas pipeline interests.
      An analyst who asked to remain unidentified, discouraged
  the Pickens rumor. "Pickens has a plateful already with his
  holdings in Burlington Northern and Amerada Hess," he said. "I
  don't think he would be willing to take on Tenneco's problems
  with Case (the farm equipment unit), which has been losing
  about 180 mln dlrs annually and is worth less than a billion
  dlrs on the market today."
  

