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'The White Sharks Of Wall Street: Thomas Mellon Evans And The Original Corporate Raiders' by Diana B. Henriques
From his Pittsburgh perch, Thomas Mellon Evans was original corporate raider
Sunday, July 23, 2000
By Thomas O'Boyle, Post-Gazette Assistant Managing Editor/Features
The stock market was in its sixth year of historic bull-market growth. A new breed of corporate pirates had made fearsome threats to staid corporate managers. And in the “profit-or-perish” mentality that increasingly came to dominate the landscape, businesses were merged and acquired, bought and resold, flattened, folded and mutilated, mostly with no regard whatsoever to the societal consequences.
The year was 1955 and, as Diana B. Henriques, a reporter for The New York Times, chronicles in her new book, those who imagine that the financial world of the Eisenhower era was as bland and sleepy as American society don’t know their history.
Today’s corporate creed of maximizing shareholder returns had its genesis in the 1950s, and one of the pioneering swashbucklers of that era was Pittsburgh’s own Thomas Mellon Evans.
The bulk of the book is Evans’ life story. Regrettably, it isn’t the full story. Perhaps that will never be told. Evans, who died in New York City in 1997 at 86, isn’t talking, and his three sons don’t appear to be, either. (One is cited as a source, but his cooperation was of little apparent value.)
As a result, much is missing from Henriques’ otherwise commendable effort. She tells the story but not the why. And the why is the real story.
Evans’ acquisitiveness bordered on kleptomania, and in that regard, he’s a very intriguing character to study, but Henriques’ treatment is almost too evenhanded; you seldom get a sense of whether she admires or despises her subject.
During his long and colorful career, Evans used debt, cash, the Tax Code, accounting gimmicks, stock -- you name it, short of a .45 automatic -- to obtain control of more than 80 U.S. firms via his Pittsburgh-based H.K. Porter holding company, which has its headquarters on Grant Street.
He trashed several marriages -- Josephine, his second wife, shot herself three times before delivering the coup de grace, a suicide so grotesque it was initially investigated as a homicide -- and he died estranged from his three sons.
Evans lived and breathed business, and like anyone obsessed with the singular pursuit of one thing, he paid, one would presume, a heavy psychic price.
But what was that price, and why was he so willing to pay it? Why was Evans so acquisitive and so intent on demolishing much of what he acquired? (Ironically, his flagship H.K. Porter came full circle in the time he owned it, landing in 1991 in bankruptcy court, from which he had rescued it a half-century earlier.)
Other than the obvious answer -- that sharks gotta swim and that Evans was the ultimate predator -- what made the guy tick? Oddly, there’s little insight, even speculation, into that question.
Henriques gives tantalizing tidbits here and there. The extraordinarily wealthy Evans “gave only modest amounts to his friend Larry Mellon [the son of William Larimer Mellon, Evans’ early mentor and benefactor] for Mellon’s heroic medical mission in Haiti, although he did visit the facility at least once.”
Later, Henriques offers this cryptic summation of son Ned’s obvious estrangement from his legendary father: “Despite his meager shareholdings, Ned Evans was determined to retain control of ‘his’ company [Macmillan, which his father had acquired and British publishing mogul Robert Maxwell was in hot pursuit of]. His efforts to do so over the next 18 months appear in hindsight to have been a repudiation of his father’s philosophy so thorough and complete that it might have been shaped by a novelist’s hand.”
Well, of course they were a repudiation. But why? The relationship between father and son goes largely unexamined and I, for one, don’t want to wait for the novel.
It’s a shame Henriques doesn’t endeavor to offer more insight, because her subject is arguably one of the seminal figures of 20th-century business, ranking among a pantheon that would certainly include the famed Mellons, to whom Evans was distantly related.
His early misfortune was having been descended from the wrong branch of the great clan. Andrew Mellon, the Scots-Irish farmer who emigrated to Western Pennsylvania in 1818, had a daughter, Elinor, and a son, Thomas. The son, “Judge Mellon,” went on to become the dynasty’s founder and the father of the progeny with whom we associate the “Mellon” name.
Evans, on the other hand, was the great-grandson of Elinor and suffered much hardship in early life as a result of his less prestigious lineage. Orphaned at 11, young Tom and his sister shuttled among their late mother’s concerned relatives in Tennessee before being taken in by his mother’s sister, Mary, and her husband, Hugh Rodman, and returning to Pittsburgh.
The Rodmans gave Evans a life of privilege, certainly -- he graduated from Shady Side Academy in 1927 and from Yale four years later -- but nothing that would compare with the life of a true “Mellon.”
As a close childhood friend of Larry Mellon, as well as a classmate of his at Shady Side, Evans had his nose pressed against the glass-house opulence that he had missed out on early in life. But Henriques doesn’t develop that line of thought and a better reporter and storyteller would have. The elusive “why” -- what drove Evans to be relentless in his pursuit of wealth -- remains unexamined and unanswered.
The story is well told, and the footnotes are copious. Most of the citations, however, are to secondary rather than primary sources. As a result, we’re told often of Evans’ “terrifying temper” -- he was, indeed, one of the most feared businessmen of his or any age -- yet we’re offered surprisingly little anecdotal evidence of it.
The boardroom intrigues are largely without intrigue. There’s no shouting, no trembling, no fear and loathing. Even the most engaging chapter, which relates his failed bid for Westinghouse Air Brake in 1968, is assembled and retold mostly from old Pittsburgh Press and Post-Gazette clippings from that time. Surely, someone’s still alive who attended those meetings and could have provided firsthand observations.
Tom Evans paved the way for the more celebrated and notorious brethren that were to follow him in the ’80s and ’90s, men like Henry Kravis, T. Boone Pickens, Carl Icahn and Ronald Perelman. Henriques makes that case well. I just wish her story, an important one, were told in a more compelling and thorough fashion.
Thomas O’Boyle is the author of “At Any Cost: Jack Welch, General Electric, and the Pursuit of Profit.”
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