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The Globe and Mail

Thank God for Frank Stronach. What would we do without him?

Every night at the dinner table, every business journalist in this country ought to give a toast to the continued good health of Frank Stronach, for what would corporate Canada look like without him?

A dull parade of insurance executives, bankers, oilmen and geologists, that's what, most of them highly competent, utterly uncontroversial and largely devoid of charisma. The men and women (primarily men, sorry to say) who manage Canada's biggest companies tend to conduct their lives in such a buttoned-up manner as to avoid becoming household names, no matter how embedded in the country's fabric their businesses are.

Quick, can you name the guy who runs Tim Hortons, one of the 60 largest businesses in Canada and easily one of its most-recognized brands? (It's Don Schroeder, a lawyer who apparently enjoys golf and who previously held the title of "chief compliance officer," among others.) No paparazzi are gainfully employed to follow around Canadian Tire's Stephen Wetmore or CIBC's Gerry McCaughey. The tabloids simply aren't interested - for good reason.

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But there's always Frank, the chairman of Magna International, the auto parts colossus on which his fame and personal wealth are built.

He'll tweak his shareholders' noses, then poke them in the eye. He'll rant and he'll stomp and when his critics give it to him, he'll give it right back. Some years ago, after hearing someone complain that he'd been paid $58-million for a year's work, he responded: "I should get more."

He once got a hedge fund manager so upset that the manager compared Mr. Stronach's control of real estate firm MI Developments to Fidel Castro's iron rule over Cuba. (That's totally unfair. Frank Stronach is much more powerful than Fidel Castro!) A Stronach-controlled racetrack company, Magna Entertainment, built a glitzy, multimillion-dollar racetrack and gambling complex in Austria (at investors' expense), though the local market seemed small for such a grand facility. The place lost buckets of money. But it was conveniently located for a certain lover of horses who lives in the region.

That's why we love the man. Oh, the stories he generates! Journalists crave conflict, and there just isn't enough of it in Canadian business at the moment. Not a single chartered bank had the decency to blow up and collapse during the crisis. Our Finance Minister and central bank governor are now swanning around the globe, touting the merits of the Canadian way and throwing around terms like "macroprudential regulation." Worthwhile Canadian Initiative. God help us. Now we'll never be able to shed our reputation as the most boring nation in the G20.

So we turn to Frank as our best hope. And boy, has he delivered. It's The People v. Frank Stronach. The Canada Pension Plan Investment Board, money manager to working Canadians who don't live in Quebec, objects to Mr. Stronach's latest scheme, calling it "offensive", not to mention "excessive" and "inappropriate" and - have we forgotten anything? - oh, yes, "horrible." Maybe not as horrible as living in Castro's Cuba, but you get the idea.

In sum, and in case you haven't been following the story, Mr. Stronach has decided to listen to the shareholders who for so many years have objected to his ability to control Magna International (and extract large sums from it for himself) while owning less than 1 per cent of it. He will end this arrangement, in return for a mere $860-million or so in cash and shares, plus several more years of payments, plus control of a joint venture in electric cars that Magna would co-own.

Excessive? Yes. Offensive? Sure. Surprising? Not in the slightest, because this isn't the first time Mr. Stronach has proposed a highly complicated scheme for his own self-enrichment. Three years ago, Magna sold a stake to Russian oligarch Oleg Deripaska. The deal was purportedly an entree into Russia's growing car market, but came with so many wrinkles and side deals (extra dividends and payments for Mr. Stronach and certain members of management) that it, too, caused a flap. But in the end, the shareholders approved it. And they might well do the same with this latest deal.

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How do we know? It's just a gut feeling, because - and this might be the most fascinating thing about Frank Stronach - he almost always gets his way. Mr. Stronach is famous for stocking the Magna board with friendly directors, which helps. In this latest case, they've declined to recommend the deal to other shareholders (as they would normally do). But they won't come out and oppose it, either. Bay Street, too, has been an enabler of Mr. Stronach's antics. Privately, money managers and analysts will gripe about him - but almost always off the record. When the chips are down, very few of them speak out publicly.

Mr. Stronach has little to fear here: no matter how "egregious" the $860-million payment, a good many shareholders just want to see him gone. Unlike, say, business writers, who will mourn the end of the Stronach era.

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