Make no mistake: The public face and driving force at Jim Pattison Group remains the company’s 90-year-old founder.
However, as Jimmy Pattison vies to add another trophy to his crowded mantelpiece with a $982-million bid for the minority interest in lumber producer Canfor Corp., the supporting cast at the Vancouver-based conglomerate is stepping out of his considerable shadow. And a look at the executives involved in this deal, and other Jim Pattison Group investments, shows who is in the running to lead Canada’s second-largest private company once its irrepressible, but not irreplaceable, leader leaves the stage.
Mr. Pattison has a famously eclectic collection of holdings, ranging from the auto dealerships where he got his start in business in 1961 to supermarkets, fish packers, billboards and the Ripley’s Believe It or Not chain. “Jimmy’s investments are always driven by value. He has an eagle eye for a business that can somehow be improved,” said author Paul Grescoe, who co-wrote Mr. Pattison’s autobiography in 1987 and subsequently took care of the company’s communications for a decade. “Jimmy knows how to milk a business for every drop of value he can glean from it.”
“In the back of his mind, I have no doubt that Jimmy is thinking he wants to control the forest industry in Canada,” said Mr. Grescoe, who is now retired. The observation may speak to future deals, as Mr. Pattison is also a significant investor in West Fraser Timber Co. Ltd. Mr. Grescoe noted that Mr. Pattison only makes acquisitions when he perceives he’s getting a bargain price, and in Canfor’s case, the chart tells a tale: It was a $30 stock less than a year ago, while Mr. Pattison’s proposal is for $16 a share.
Mr. Pattison’s toolbox also includes a talent for delegating, according to Mr. Grescoe. He lets executives run each division, while holding them accountable in sometimes-gruelling quarterly reviews. In handing off responsibility for his far-flung holdings, which have 46,000 employees, Mr. Pattison reveals those he trusts to run the parent company on a day-to-day basis.
Through various entities, Mr. Pattison owns stakes in two major public companies – Canfor and Westshore Terminals Investment Corp. – and it is telling to see who the CEO put on both boards. Mr. Pattison is not a director at either company. Jim Pattison Group chief operating officer Glen Clark shoulders that responsibility at both. He joined the company in 2001, two years after stepping down as British Columbia’s premier.
The Canfor board also includes Ryan Barrington-Foote, head of accounting at Jim Pattison Group and a former KPMG accountant. At Westshore, North America’s largest coal terminal, lawyer Nick Desmarais, head of the legal team at Jim Pattison Group, fills the second board seat.
Rounding out the executive team are David Cobb, the head of corporate development at Jim Pattison Group and former deputy CEO for the Vancouver Winter Games, and David Bell, who runs the financial side of the business.
This small group helps Mr. Pattison run the company, which had sales of $10.6-billion last year, and likely includes his successor.
One of Mr. Pattison’s three children – Jim Pattison Jr. – is on the board of the parent company, but he is president of the Florida-based entertainment franchise Ripley’s, rather than working at head office.
When asked about his succession plan by reporters, Mr. Pattison has consistently said he has one, and then changed the subject.
Mr. Grescoe joked that the only people who likely know Mr. Pattison’s potential replacement are his wife of 68 years, Mary, and his executive assistant, Maureen Chant, who has worked for him since 1963.
Long after the charismatic CEO leaves, the Jim Pattison Group’s value approach to investing is likely to endure. However, investment bankers who work with the company do expect the founder’s preoccupation with buying up businesses, but never selling assets, will change under a new leader.
One of Mr. Pattison’s good friends and frequent travelling companions is William Stinson, former CEO of Canadian Pacific Ltd., once a massive publicly traded conglomerate. Mr. Stinson’s successor unlocked considerable value for shareholders by breaking up Canadian Pacific. Whoever follows Mr. Pattison might take a similar approach to simplifying a sprawling collection of businesses.
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