“What’s that?”
“The airplane. A Westwind. Very old-fashioned, cramped and uncomfortable, I’m told,” Frost said.
“By whom?”
“Marvin Yates.”
“I see. Well, you can tell Marvin he was absolutely right.”
“But you were better off than being aboard a Lear.”
“And what’s that?”
“I haven’t the faintest idea. But people like Marvin who ride around in these things all the time say it’s even worse than a Westwind.”
“I see.”
“My trip was fine, to reply to your original question,” Frost said. “Marvin read the group the riot act and I think they’re ready to confront Gruen tomorrow.”
“They’re meeting with him?”
“Yes, first thing in the morning.”
“Does that include you?”
“Afraid so,” Reuben answered simply, seeing no need to elaborate or to inform his wife that he was going along only as the result of Flemming’s intervention.
Reuben ordered a bottle of the Amarone from the middle range of Vico’s reasonably priced wine list, and both he and Cynthia ordered the Caprese rustica and the linguine vongole, a very superior pasta with white clam sauce. Cesare, the waiter, and the two owners expressed pleasure at their selection.
“Even leaving the delays aside,” Reuben said, ordering completed, “I gather your flight was not exactly the best one you ever had.”
“Indeed not,” Cynthia answered. “Remember Rosencrantz and Guildenstern Are Dead? The Tom Stoppard play? That’s the way everyone felt on the plane I was on—minor characters excluded from the main drama. Both Diana and Sorella were seething—Diana could barely contain her remarks about male chauvinism, and Sorella certainly felt that she, rather than Randolph Hedley, should be representing the Foundation at Flemming’s little summit.”
“They—or Sorella at least—were probably right,” Frost said.
“Nate Perkins was annoyed, too,” Cynthia went on. “I don’t think he gave a damn about what was going on on your flight, but he certainly felt hurt and excluded. He was sitting across the aisle from me and was grousing, or verbally pouting, or whatever you might want to call it, most of the way back.”
“He really is a hothouse flower, isn’t he?” Reuben said. “If he were ever put in charge of anything at AFC, he’d collapse in an instant. Or for that matter, he’d dissolve if his publisher ever put him on a deadline. But I know that doesn’t stop his resentment and general huffiness.”
The couple, hours away from a rather skimpy lunch at the Mohawk Inn, quickly devoured their Caprese rustica—mozzarella, tomatoes, salami and all.
“I did learn one very interesting thing,” Cynthia said.
“Which was?” Reuben asked.
“Did you hear anything about the TV advertisement Flemming is going to make?” Cynthia asked.
“Good Lord, no,” Frost replied. “What are you talking about?”
“Apparently Vickery & Carpenter, the advertising agency for AFC, has talked Flemming into doing a commercial for SUPERBOWL.”
“I don’t believe it.”
“As I get the story, Flemming’s going to come on, look at the viewers straight on and tell them how wonderful and pure SUPERBOWL soups are. You know, just like Lee Iacocca and Chrysler or that funny chicken plucker, Frank Perdue.”
“Who told you this?” Frost demanded.
“Sally,” Cynthia answered. “I was sitting next to her on the flight down. She’s beside herself. You know how she is about privacy—as far as she’s concerned, notoriety and publicity ended the day she quit professional tennis. She’s sure Flemming will make a fool of himself. ‘You just know what will happen,’ she said to me. ‘We’ll go to the theater some night, minding our own business, when the entire Morristown, New Jersey, Ladies’ Club will do one collective swoon and demand to know if Flemming’s the soup salesman they’ve seen on TV.’ She’s really upset, Reuben, but there’s nothing she can do—Flemming believes in advertising and he’s going to follow the Vickery advice.”
Frost chuckled as his wife described Sally’s distress—and his old friend Flemming’s apparently new senescent vanity.
“She never said it,” Cynthia went on, “but she certainly implied that Flemming should be getting out of AFC. More than implied, in fact. She said she wished there was some way for him to retire gracefully.”
“Who would she have replace him? Billy O’Neal?” Frost asked.
“She didn’t say, but she certainly had kind words for Casper Robbins. He’s obviously a very close friend.”
“Close friend? Do you think that’s all?”
“I’ve never been sure. I suppose I think he’s her tennis partner and chum, and that’s it. But God knows there’ve been enough rumors about the two of them over the years,” Cynthia said.
“Very interesting,” Reuben said, by now at work on his linguine. “Maybe Jeffrey Gruen will solve her problem.”
“I seriously doubt that,” his wife answered. “Sally said Flemming’s apoplectic on the subject of Gruen.”
“I’m sure,” Reuben said, with a sigh. “All of which means we should get home. Tomorrow’s going to be some kind of day.”
While they were waiting for the check, Reuben looked around the narrow confines of the restaurant.
“What do you suppose was here before, Cynthia, a shoe store?” Reuben asked.
“I don’t remember, but it certainly is possible,” his wife replied.
“I must say it reminds me of the first apartment we ever had,” Reuben said. “That railroad flat in the tenement down on Nineteenth Street.”
“You’re right, dear. The kitchen would have been right back there, with the bathroom behind it,” Cynthia said, pointing to the rear of the restaurant.
“And as I figure it, Cynthia, our table is approximately where our bed was,” Reuben added.
“Nothing wrong with that, my dear.”
“No indeed. No indeed.” Reuben grasped his wife’s wrist with affection, then picked up the check Gennaro had put on the table. He paid the check—both Gennaro and his partner Nino knew the Frosts well enough not to protest the omission of dessert or coffee—and the Frosts left, after shaking hands all around.
“There’s no justice in the world,” Frost said, as he walked home with his wife. “Look at those fellows, running an absolutely impeccable restaurant and making a good, but not huge, amount of money. Then look at Jeffrey Gruen, who’s become a billionaire by wheeling and dealing, shuffling papers. Making one batch of linguine vongole in that restaurant is a bigger contribution to society than any corporate stew Gruen ever cooked up.”
“Why don’t you tell him that tomorrow, dear?” Cynthia teased her husband.
“For two cents I would,” Frost said. “But Flemming and his crew can hold their own.”
MONDAY MEETING
6
Reuben Frost slept fitfully and was fully awake when he got out of bed at seven o’clock Monday morning. He had scarcely had time to retrieve the newspaper from the front door when the telephone rang and he found himself talking with George Bannard. Bannard, who now held the post Frost had once occupied, as Executive Partner of Chase & Ward, was not one of Reuben’s favorites. He found him bumptious and often ill-mannered—and it had always seemed to Frost that Bannard had perhaps tried to hasten his retirement as an active partner of the firm.
“Reuben, what’s this I hear about a takeover of AFC?” Bannard demanded. Frost was startled at the question. Yates or Crowder must have felt some reason to call Bannard over the weekend and tell him the news. But why?
“It’s very possible,” Frost answered. “But I’m sure the Company will fight it. It’s Jeffrey Gruen, you know.”
“Yes, yes. Marvin Yates called me last night,” Bannard said. Then, after a pause, he asked Frost if he were “going to be involved.”
“To some degree, I expect. Flemming asked me to go to the meetin
gs today.”
“Fine, Reuben, fine. But just remember, Reuben, you’re an old croak like me—you don’t know a goddam thing about this takeover stuff.”
“Yes, but I have a modicum of common sense and have worked out tough corporate problems for half a century,” Frost felt like answering, but did not.
“Of course, George,” he said instead. “As far as I’m concerned it’s Marvin’s show and I’m just there to help out if and when I can.”
“Good, Reuben. I knew that’s what you’d say. Good luck.” Bannard hung up the telephone without saying good-bye.
So Yates had put him up to that call, Frost thought. Well, the hell with both of them. Of course he wasn’t going to run the show any more than his successor as AFC’s counsel, Ernest Crowder, was. Yates was the expert, there was no doubt about that. Frost, and Crowder, too, would only speak when spoken to—unless, of course, they felt that circumstances dictated otherwise. Surely there was a First Amendment right of free speech for Chase & Ward partners (and retired partners) that even George Bannard could not abrogate. In any event, Frost had forgotten the Executive Partner’s call within seconds of opening up the Times.
Reuben Frost actually knew the notorious Jeffrey Gruen. Or more precisely, he had met him several times at meetings of the Board of Directors of the National Ballet, of which Frost was chairman. Gruen was a modest, even retiring, figure at these sessions, conscious perhaps that he had been selected for the Board more for his potential as a donor to NatBallet than as an adviser on artistic matters. (In reality, he should not have been in the least self-conscious; most of his fellow directors had been picked for precisely the same reason.)
There had been nothing in Gruen’s outward demeanor that had evidenced his reputation for both gall and greed. Frost had found him perfectly pleasant, and cooperative in performing the few modest tasks he had been given as a director. All Frost really knew about Gruen he had learned from the public print, though, God knows, there had been plenty to read about, starting with his Horatio Alger rise from being a runner on the floor of the American Stock Exchange to a succession of jobs, none held for very long, at well-known Wall Street houses and then at his own venture-capital firm, started in the mid-1970s.
Gruen had shown savvy in making seed-money investments in small computer companies that tried to fill the interstices of the marketplace not occupied by IBM; the transition from venture capitalist to raider had been easy. His own fortune, and the financial backing of his grateful investing partners, had given him an equity base from which to acquire ever-larger companies.
Marvin Yates had been right in assessing Gruen’s current position—that he “needed a win” to reverse a series of unexpected setbacks in his recent corporate forays. But there was no evidence of this as he greeted the delegation from AFC on Monday morning. The group had assembled one by one in the spacious waiting room of the offices of Gruen & Company at 324 Park Avenue: Reuben Frost, Marvin Yates and Ernest Crowder from Chase & Ward, and Flemming and Laurance Andersen, Billy O’Neal and Casper Robbins from the Company. Promptly at nine, they were shown to a spacious, mahogany-paneled conference room, where Gruen stood at the door and shook hands with each of them. Arrayed along one side of the long table in the room were five others, only one of whom Frost had met before—Jason Stockmeyer, the senior partner of Stockmeyer, Browne & Pernis, Gruen’s legal counsel. And the greatest expert in New York, at least in point of service, on the legal aspects of mergers and acquisitions; Stockmeyer had been willing to represent clients interested in making unfriendly acquisition proposals when such representation “wasn’t done” by the more established and respectable Wall Street law firms and was treated as being in much the same class as ambulance chasing. Time, and the attraction of the splendid fees involved, had changed all that—even Ernest Crowder no longer turned up his patrician nose when “M&A” was mentioned—but Stockmeyer still gained some advantage from the length of his experience. (In addition to which, he was an intelligent and imaginative lawyer and a decent and pleasant person.)
Stockmeyer greeted Frost warmly and introduced him to three colleagues, two male partners and a young woman associate. The fifth person waiting in the room turned out to be Jeffrey Gruen’s young assistant, Norman Cobb.
The AFC forces lined up on the side opposite their Gruen counterparts, with Flemming Andersen, flanked by Casper Robbins and Marvin Yates, sitting in the center.
While the assemblage was getting organized, a uniformed butler, working from a large table at one end of the room, served juice, pastries and coffee to those desiring them. Reuben Frost, accepting a Danish and coffee, contrasted Gruen’s amenities with those at Chase & Ward. One attending a meeting at the law firm was lucky to get a cup of weak, lukewarm coffee in a serve-yourself Styrofoam cup. Solid food in the morning consisted of cold, leaden pastries wrapped in transparent plastic. By comparison, here at Gruen & Company the pastries were warm and served on china plates, and the fresh coffee was dispensed in china cups with saucers. Ah well, Frost consoled himself, Chase & Ward was in the business of providing legal services, not catered meals.
Jeffrey Gruen sat down directly across from Flemming Andersen. Without a word, the butler brought him a cup of tea, and Cobb placed a single typewritten page in front of him on the table.
Frost could not help noticing how impeccably neat the man was. Not a hair was out of place on his trimly barbered head; his manicured fingernails were immaculate; his expensively tailored suit was well pressed. It was almost as if he had been unpacked from a hermetically sealed tube just before entering the conference room. The only imperfection was the reddish-brown tint of his hair, which was almost certainly from a bottle or a jar.
Gruen introduced those on his side of the table and asked Flemming Andersen to do the same. Then, in an outwardly affable manner, he thanked the AFC delegation for being present.
“I realize this is probably most inconvenient for many of you, coming here on a Monday morning at the end of the summer,” Gruen began, speaking slowly and deliberately in an accentless voice. “But I thought it was important that you know where I stand.
“As I told Mr. Andersen Saturday evening, Gruen & Company is interested in buying Andersen Foods—either in a friendly, negotiated deal or, if necessary, through a tender offer. My colleagues and I have been looking at the Company for some time, and we like what we see.…”
“Can, I interrupt right there?” Flemming Andersen said, in a strident voice.
“If you like,” Gruen answered evenly. “I had thought I would make my statement and then give you an opportunity to reply. But go ahead, please.”
“I just wanted to say right up front that no one is interested in selling AFC,” Andersen said, ignoring the agreed legal advice from the weekend that he would hear Gruen out but remain noncommittal.
“That may be, Mr. Andersen, but I’m interested in buying,” Gruen shot back. “And, if I may, perhaps I can tell you why.
“When we first started looking at AFC, we were impressed with how well run it is, how good your employee relations are, yet how trim you are operationally. The more we saw, the more AFC appealed to us as a good, solid investment. We firmed up our plans last week, and I was able to tell Mr. Andersen of the terms we’re thinking about last Saturday.” He made it sound as if it were the most natural thing in the world to call an executive on a Saturday night and inform him that his corporation was about to be raided.
“I’m sure you all know what those terms are. But to repeat: we are thinking of offering forty dollars for each and every share of AFC common—if the offer is friendly and endorsed by the Board. That’s obviously what we would prefer. But if you don’t want to be friendly, that’s all right, too. Only the price will be thirty-eight dollars.”
“What do you see as your timing, Jeffrey?” Marvin Yates asked.
“We’ve got the financing. We’re ready to go. We plan to file our 13D, showing our existing holdings, with the SEC this afternoon. We can be
ready to file a 14D, with the exact terms of the offer, very soon thereafter,” Gruen said. “Like, for example, tomorrow after the close of the market.”
“Can I ask another question?” Yates said.
“Sure.”
“I’m a little puzzled here,” Yates said. “Flemming Andersen has indicated there’s no interest in selling. Now obviously he can’t speak for the public holders, but he can certainly speak for a pretty fair number of the private ones—about forty-seven percent, to be exact. I’m sure you know that figure, Jeffrey, but it does lead me to wonder how you think you’ll ever get control of AFC.”
“Yes, I know the figures,” Gruen responded. “But as I understand it, there aren’t any voting trusts or voting agreements binding that stock, are there?”
“No, no, nothing like that.”
“Well, then, maybe Mr. Andersen can speak for the holders of that forty-seven percent and maybe he can’t. And I’m not sure the legal advisers to the Foundation would permit the trustees to pass up an offer at thirty-eight, forty dollars.”
“Jeffrey, I doubt very much that they’ll have a problem at your, shall we say, conservative price. Or perhaps I should say downright chintzy price?” Yates said.
“Say what you like, Marvin,” Gruen answered, in an unruffled voice. “It’s not your money—either going out or coming in.”
“Can I have another question?” Yates asked.
“Marvin, you can have as many as you want,” Gruen said, smiling.
“Let’s put it this way. I’m puzzled about why you want AFC. There’s no way that the parts are worth more than the whole—you can’t sell off bits and pieces and come out with a profit. The Company’s too integrated for that. So what’s your interest? I just don’t see why it appeals to you.”
“Well, there is a reason, which I’m perfectly happy to tell you. Whatever the rationale may have been, the Andersens have kept AFC out of overseas operations. They’ve concentrated almost exclusively on United States, or at least North American, business. I think the Company’s ready for a major, major expansion abroad. I want to buy the Company and push that expansion. Does that make things clear?”
Murders & Acquisitions Page 6
