The White Sharks of Wall Street : Thomas Mellon Evans and the Original Corporate Raiders
It almost seems that Thomas Mellon Evans was a man so far ahead of his contemporaries that he had moved into the shadows before the full force of his business style had dawned on the rest of corporate America. At every step in his career, he was barging in where few would follow -- at first. But follow they did, at last."
-- from the Prologue
The first in-depth portrait of the life and times of the trailblazing financier Thomas Mellon Evans -- the man who pursued wealth and power in the 1950s with a brash ruthlessness that forever changed the face of corporate America.
Long before Michael Milken was using junk bonds to finance corporate takeovers, Thomas Mellon Evans used debt, cash, and the tax code to obtain control of more than eighty American companies. Long before investors began to lobby for "shareholder's rights," Evans was demanding that public companies be run only for their shareholders -- not for their employees, their executives, or their surrounding communities. To some, Evans's merciless style presaged much that is wrong with corporate life today. To others, he intuitively knew what was needed to keep America competitive in the wake of a global war.
In The White Sharks of Wall Street, New York Times investigative reporter Diana Henriques provides the first biography of this pivotal figure in American business history. She also portrays the other pioneering corporate raiders of the postwar period, such as Robert Young and Louis Wolfson, and shows how these men learned from one another and advanced one another's takeover tactics. She relates in dramatic detail a number of important early takeover fights -- Wolfson's challenge to Montgomery Ward, Young's move on the New York Central Railroad, the fight for Follansbee Steel -- and shows how they foreshadowed the desperate battle waged by Tom Evans's son, Ned Evans, to keep the British raider Robert Maxwell away from his Macmillan publishing empire during the 1980s. Henriques also reaches beyond the business arena to tally the tragic personal cost of Evans's pursuit of success and to show how the family dynasty shattered when his sons were driven by his own stubbornness and pride to become his rivals. In the end, the battling patriarch faced his youngest son in a poignant battle for control at the Crane Company, the once-famous Chicago plumbing and valve company that Tom Evans had himself seized in a brilliant takeover coup twenty-five years earlier.
The White Sharks of Wall Street is a fascinating portrait of an extraordinary man, whose career blazed across the sky and then sank into obscurity -- but not before he had provided the template for how American business would operate for the next four decades.
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May 15, 2000
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Excerpt from The White Sharks of Wall Street by Diana B. Henriques
Prologue: The Second Time Around
The Time: An evening in the early eighties.
The Place: A soaring hall in a famous Manhattan museum, set for dinner.
The Occasion: A private party hosted by Drexel Burnham Lambert, just emerging as the leading financier of the proliferating battles for control of America's largest corporations. Around the tables are men whose ambitions will chill the hearts of company executives, local mayors, labor leaders, and boardroom directors for years to come.
But at one table sits a man none of the celebrity-spotters recognize. He is Robert Sheldon Evans, an executive at the Crane Company, a polyglot industrial corporation whose last big headlines on Wall Street had come in the mid-seventies, when it made a bid to buy a stake in Anaconda Copper.
One of Evans's curious tablemates finally asks the question others at the table are clearly pondering. Why is he here? Where does he fit into this choreography of power?
"Oh," answers the low-key man from Crane, "I'm standing in for my dad, Tom Evans."
The questioner still looks blank. Who is this Tom Evans?
A brief coolness, then: "Well, I guess you could say, he started all this." His hand swept in the room full of strivers and acquirers, raiders and would-be raiders.
In the business world of the late fifties -- that hazy fax-free and pre-laptop era when a round-trip to the Coast took days and takeover battles took months -- Thomas Mellon Evans was a widely recognized figure. A Daddy Warbucks lookalike, he was so familiar that business writers could use his name unexplained, just as the names of investment wizard Warren Buffett and entrepreneur Donald Trump would be used decades later. He was a controversial figure as well -- a New Jersey congressman would later brand him "the white shark" and Forbes magazine called him "the man in the wolf suit." Long before Drexel's Michael Milken became a household name in the eighties by facilitating the use of junk bonds to finance hostile corporate takeovers, Tom Evans had used debt, cash, and the tax code to seize control of more than eighty American companies, small and large. Long before giant pension funds and other institutional investors began to lobby for "shareholder rights," Tom Evans was demanding that public companies operate only for their shareholders -- not for their employees or their executives, not for their surrounding communities, but for the people who owned their stock. His view seemed selfish and harsh in the pallid institutional community of that day, but he preached it fiercely and effectively.
By 1959, Tom Evans already had become the leading practitioner of a strange new form of corporate ruthlessness, one that squeezed "fat" out of profitable corporations in the relentless pursuit of greater profit. By 1968, the Wall Street Journal had declared Tom Evans "something of a legend for his tough methods of operating the company once he wins control. He demands prompt profit performance from both assets and men; if he doesn't get it, he sells the assets or fires the men."
Yet, despite the swath that Tom Evans cut across America's corporate landscape in the fifties and early sixties, most of the people who poured into Wall Street in the eighties to practice "M&A" -- mergers and acquisitions -- had no idea they were standing on anyone's shoulders. They thought they were part of a new age, engaged in something history had never seen before. They were wrong. Everywhere they strode, Tom Evans had been there ahead of them.