	hughes ht changes stance on merger after suit a one billion dlr lawsuit pushed hughes tool co into an about face on its rejection of a proposed merger with baker international corp bko wall street analysts said last night hughes said the planned merger with baker was off baker then filed a suit seeking punitive damages from hughes for calling off the merger at midday today hughes said it was still interested in the merger the analysts also said hughes may be worried that its troubles could make it a takeover candidate there was speculation today that harold simmons the dallas investor might try to uire hughes but simmons told reuters he is not interested simmons said he intends to file a d with the securities and exchange monday reporting a stake of five pct or more in some publicly traded company he declined to identify the target other than to rule out hughes one analyst said another factor in the latest hughes turnabout was borg warner corp bor which owns pct of hughes borg warner ex chairman j f bere who serves on the hughes board is believed to favor the merger with baker despite the hughes statement that it is interested in a merger and baker s response that a merger is still possibile analysts said no one could be certain where the situation was going i think the merger is not going through said phil pace analyst at kidder peabody and co he said the merger lost a lot of its appeal when the u s department of justice required that baker sell off its reed tool co operation although the reed operation is relatively small in view of the total size of a combined baker hughes pace said to pct of the cost savings are tied up in that they hughes are obviously concerned about the lawsuit said james crandell analyst at salomon brothers inc apparently they are willing to continue discussions but whether they will alter their position i don t know it s getting a little confusing said james carroll analyst at painewebber group inc he said the arguments cited by hughes yesterday for not doing the merger tend to be weak hughes said yesterday that as a condition of the merger it wanted reed tool and other businesses sold prior to april the projected merger date a government decree allowed a longer period of time hughes contended it was better to formally combine the companies with the status of reed already settled baker apparently sees no reason to speed up the sale carroll said baker had previously estimated to mln dlrs in savings if the companies were combined without selling reed but he said baker now thinks to mln dlrs will be saved while hughes sees a saving of only to mln dlrs carroll also noted that since the merger accord was first signed the outlook for the industry has improved materially hughes may simply feel the pressure on the oil service industry is lifting reuter 
