Cities Service cautious on new takeover bid

Occidental Petroleum Corporation Thursday launched its unsolicited takeover offer for Cities Service Company, putting new pressure on Cities to find a suitable merger partner.

Cities, which earlier this week rejected Occidental's initial merger proposal , advised its shareholders not to jump too quickly at Occidental's offer to purchase 38.2 million Cities shares, representing about 49 percent of the total outstanding, at $50 each. Wall Street reacted positively to the Occidental bid, with Cities stock prices rising almost $5 Thursday morning.