Billionaire Bill Foley has bought a ski resort, a cattle ranch and a couple of restaurant chains in Montana — and the self-described “serial acquirer” may be just getting started.
5-14-08
If you didn’t know any better, you might think William Patrick (Bill) Foley II was just another retiring baby boomer looking for golf courses, open spaces and the chance to recapture an idealized childhood of summertimes on the family ranch. A frank man with an almost goofy charm, he speaks of his love for Montana, his concern for the landscape — and the joy he gets bombing around the backcountry on an ATV or a snowmobile.
But the truth is, Foley isn’t very good at leisure. He’s got the fancy log home on Whitefish Lake, five West Coast wineries, the huge cattle ranch near Deer Lodge, and the requisite private jets, but he can’t seem to help turning everything into a business.
He bought Big Mountain, the Whitefish ski hill, and is busy turning it into a more elaborate entity called Whitefish Mountain Resort. He’s transforming the 90,000-acre Rock Creek Cattle Company into a gated, luxury vacation community with 240 home sites. He bought the Glacier Jet Center at the Kalispell Airport, where he parks his planes, and has big ambitions for that, too.
He enjoyed a couple of local restaurants — Ciao Mambo and MacKenzie River Pizza Co. — and added them to his portfolio, with plans to build a substantial casual eatery chain. And then there’s Fidelity National Timber Resources, which owns extensive forests in Oregon and Washington that Foley thought had a lot of value for real estate development.
“I’m a serial acquirer,” he says. “I can’t seem to stop, whatever flaw that is. And then I can’t stand it until it is perfect. I have to keep on fooling with it. I wish I could figure that one out. My golf game would get a lot better.”
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RICH MAN’S RANCH:The Rock Creek Cattle Co. near Deer Lodge, Mont. will keep the cows — event as it adds several hundred luxury houses. Photo by Anne Medley. |
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Don’t be fooled though: He’s no slouch. Golf Digest named him one of the world’s top five executive golfers in 2004. And if his record at Fidelity National Financial, the Fortune 500 company he built from scratch, is any indication, he’s not done buying things in the West. Fidelity acquired more than 100 companies under Foley’s leadership and spun off a second public company, Fidelity National Information Services, about two years ago. In the past few years, Fidelity National Financial recapitalized, paying Foley a bundle, and he has been unloading big chunks of his FNIS stock (he stepped down as CEO of the two companies in mid-2007). He’s now set up as a perfectly positioned cash buyer at a time when lots of distressed assets are on the market.
Indeed, Foley appears to be in a much better spot than most of the Wall Street moguls, Silicon Valley financiers and high-rolling property developers who see the surging “amenity economy” in the Mountain West as the next great capitalist frontier. In some ways, he’s representative of the breed: a very rich man who’s become enamored with the West, and whose first instinct is to buy it.
Yet a number of high-profile developments by and for the wealthy — Promontory in Utah, Tamarack Resort in Idaho and Yellowstone Club in Montana, to name the most prominent examples — are staggering under heavy debt loads and a weakening economy. Boomtowns from Boise to Bozeman are seeing slower growth. But Foley, with an immense and highly liquid fortune, can afford to take the long view.
Foley is a West Point grad, and there is a certain military efficiency in his approach to business: Make sure you have plenty of assets, strategize carefully to find the non-obvious openings, win hearts and minds if you can — and cut your losses, unsentimentally, at the first sign of trouble.
If you’re the owner of a company that Foley wants to buy, it’s all sweetness and light and big piles of cash (hostile takeovers aren’t his thing). Steve Shuel, who sold MacKenzie River Pizza Co. to Foley’s restaurant group, describes the deal-making as “an unbelievable process in a positive way.” Contractors say he pays his bills, always and on time (which is more than you can say for a lot of moneyed developers), and public officials in Montana call him a model corporate citizen.
But if you’re driving around Whitefish Lake, or any other place where Foley owns a big spread, you can expect to see access to fishing blocked by poster-sized signs saying, “No Trespassing” and “Violators Will Be Prosecuted.” Not all the signs are his, but his are among the largest and most menacing.
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MONTANA CHIC:Foley’s home on Whitefish Lake features old barn wood (even on this three-car garage) and ranch-style architecture (emphasis on “style”). Photo by Anne Medley. |
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If you’re an employee at Fidelity National Financial during a period of retrenchment, you can expect that pink slip unaccompanied by any severance pay. If you’re a contractor falling behind on a job, watch out — even if, as in one case at the Rock Creek Cattle Co., your wife just committed suicide.
Foley has no time for people who don’t get it done: “If they didn’t perform, we fired them.”
All of which raises the question: why bring this approach to the Mountain West, which defines itself, at least in part, as a place with a different pace to life? Why buy property and build gates and fences in a state where the law — and the vast majority of the citizenry — zealously guard the principle of access to public lands and waterways? Why try to convince yourself, as Foley does, that your 11,000-square-foot house on Whitefish Lake, built of oak from a Kentucky tobacco barn and complete with solid copper drain spouts, is “like an old Montana ranch house.”
Partly, as always for Foley, it’s a business opportunity. But the business and the personal are tightly intertwined: “In the East, everyone wants out,” he muses. “We’ve worked hard all of our lives, and we’re hitting the age point where we want to get away. We want land and space, want to be in a cool area, maybe not all year around, but we want to be there enough to really enjoy it. We all want life to be what we had as a kid.”
Foley was born in 1944 in Austin, Texas, the only child of an Air Force officer. The family moved every few years, following his father’s transfer orders to Alaska, California (where his father was commander of Edwards Air Force Base), Virginia and Venezuela, where he attended an American-style school from the seventh to the tenth grade. Then it was a short stint in Elizabethtown, Penn., and Clinton, Md., where Foley graduated from Surrattsville High School (named after Mary Surratt, a woman conspirator hanged for her role in the assassination of President Lincoln.)
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DON’T EAT THE WOODEN ARTICHOKES: The Foley house is meticulously decorated with Western and agricultural themes. Photo by Anne Medley. |
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His mother was the scion of an old Texas ranching family, and she had four brothers, all of whom had first children, boys, who were the same age as young Bill. Until he was 16, his mother regularly returned with him to a family ranch near Amarillo.
“I grew up summers there, not for school years,” Foley says. “We’d go to a canyon, hang out and ride horses and shoot, do all kinds of dumb stuff.”
But it was the United States Military Academy at West Point, more than summers in Texas or schooling abroad, which seems to have shaped Foley. Tom Dyer, one of his schoolmates, recalls how he and Bill and about 800 other boys arrived at college on a July day in 1963, each an individual with his own haircut and clothing. “By five o’clock that night, we all had the same clothes on. Everybody had his head shaved.”
The academic program did not offer a lot of flexibility: a heavy dose of math, science and engineering tempered by a bit of the liberal arts.
“It served its purpose well. They strip you down, put you back together, better than what you were,” Dyer says. “You get a strong constitution.”
Or, as Foley puts it, “You don’t understand it quite then, what it does for you.”
Almost all of the 583 young men who graduated with Foley went into the Army and most went to Vietnam. At that time, West Point allowed graduates to follow their father into another service. Foley had fallen in love with airplanes as a boy and had wanted to fly, he says, but his eyesight had deteriorated during college. The Air Force offered him a spot as a navigator. “That’s really great news: fly in the back of an F4 over Vietnam,” he says. That sounded like a good way to get shot.
Instead, he got a desk assignment in Seattle as an Air Force representative at Boeing Company, overseeing military contracts. Neither Foley nor his fellow officers had any training in the engineering and manufacturing of aircraft, so Foley applied a regression analysis and figured out that certain costs should have been lower; he saved the Air Force $40 million on one of his earlier renegotiations, he says. He specialized in finding the padding inserted into the deals. By 26, he held the rank of captain and had authority to negotiate contracts worth up to $250 million.
The financial acumen started earlier.
“From the beginning, there was something about Bill and his penchant for, or knack for, capitalism. We would be talking about whatever, and Bill would be talking about what was going on in the stock market,” Dyer says. “He was just advanced in that regard.”
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GO ARMY! Foley is loyal to West Point, his alma mater: “Traveling around, as an only child, I was a bit of a wimp, self-centered,” he says. “It did a lot for me, taught me dicipline and authority. Photo by Anne Medley. |
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Foley says he had been a stock chartist, even at West Point. “I kept my own charts, did everything by hand. I had a broker in New York City. I’d run down and make a collect phone call. I wasn’t very scientific. I got interested in oil. I also invested in a lot of airlines. Regional airlines were getting merged — Mohawk, Bonanza, Air West, Pacific Airlines. I did really well with them. I tried to take my losses quick. I started with $2,000 dad gave me. I ended up with $25,000, which was a lot of money in 1967.”
While still in the Air Force, Foley began taking classes at Seattle University, working toward a master’s degree in business administration. He had also come to the conclusion that Seattle wasn’t a good place to meet women. He and a friend applied a bit of social analysis and concluded that flight attendants might provide fruitful fodder.
“We snooped and found an apartment building full of flight attendants: four to an apartment, three to an apartment. There were 150 units. There must have been 300 at least,” Foley says. “I met Carol there at a party. We married before I was out of the Air Force,” he says. Bill and Carol have four children.
Foley likes to mention that Carol put him through law school at the University of Washington with her job at United Airlines. Since then, he says, she’s been a freeloader.
“What? She’s a freeloader. I like to be honest,” he says.
After law school, Foley went to Arizona because it seemed to be happening, full of money from Chicago and the West Coast. He got a job at a big law firm, and, after a couple of years, founded his own firm with a few partners. He helped one client buy a small title insurance company and then, in 1984, engineered the purchase of that company for himself and his investors. He expanded the small Phoenix title company, Fidelity National Financial, mostly through acquisitions, and in 1987 took the company public and continued its growth. Some of his early deals were less than stellar, he says. He bought a troubled agency with little potential in Tucson for $1 million.
“We probably should have paid $300,000,” he says. Before long he had figured out how to buy companies often far below book value, pennies on the dollar.
“A big company would say, ‘We have to get out. We’re done.’ I’d pick up semi-bankrupt operations and survive long enough to turn them around,” he says.
All told Foley has done more than 100 corporate mergers and at least as many acquisitions. By 2003, Fidelity provided title insurance for close to one-third of all the residential real estate transactions in the United States and, in 2006, had revenues of $9.6 billion and profits of nearly $1 billion. The company streamlined its business operations with purchases of technology companies and other back-office service providers; some of those lines have been spun off into their own companies, including Fidelity National Information Services, which works with nine of the top 10 global banks. Fidelity National Financial remains so large that another spinoff, the lender services division, could well take place within a few months.
Foley is often credited with being one of the first to recognize the growth potential of the title insurance field, always something of a backwater in the real estate world. And while the company has taken a hit from the national real estate slump, it’s also finding new opportunities: managing foreclosure operations.
Not everyone thinks Foley’s leadership has been optimal. Jim Ryan, a Morningstar analyst who studies the company, gives the Fidelity companies low marks for stewardship and a lack of focus. “They act more like a Leucadia, the investment company, which buys and sells and is extremely good at it. Fidelity National Financial treats the title business as a cash cow to run an investment company,” he says, “but they don’t have the right people or the patience to pull it off.”
“I don’t like the shifting and spinning off of companies,” Ryan adds. Last quarter, for instance, Fidelity National Financial bought back one company from its own spinoff. Plus, he feels Fidelity National Financial’s board rewards Foley with big bonuses for deals that don’t necessarily add value for stockholders. Ryan cited a few recent deals, including Fidelity’s purchase of 293,000 acres of timberland for about $94 million from the wreckage of what had been Cascade Timberlands. The land extends from Bend, Ore., to the California border. Ryan says: “I’m still trying to figure that one out.”
When talking to Foley and his team, though, the artfulness of the Cascade purchase seems like part of the allure. The former assets of the bankrupt timber company had gone to auction, but, instead of bidding for the acreage, Fidelity took a back-door route, buying a controlling share of the bankrupt company’s debt. Then it stopped the auction and turned those assets to its own use. Fidelity now has two major private communities in the works on its former timberlands.
Still, in the 20 years that Fidelity National Financial has been a publicly traded company, it has averaged a 22 percent annual return to its shareholders — and Foley is proud of that figure. It’s the kind of number that keeps skeptical analysts at bay.
People who work with Foley — from his contractors to his secretaries to his business partners and associates — describe him as a genius and one of the hardest workers they’ve ever met. (The publisher of this magazine ran into him working the lift line at Whitefish Mountain Resort.) He retains even miniscule details about his many business ventures and seems to have an intuitive feel for whether something will make money or not.
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SPEED IT UP! Contractors say Foley pays his bills promptly, but he sometimes cycles through workers at a dizzying rate. Photo by Anne Medley. |
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Foley maintains an easy-going air. By contrast, Greg Lane, his point man in Montana, often looks stressed out. A mergers-and-acquisitions lawyer who joined Foley’s team in 1997, Lane is jokingly referred to as “Bill’s better half.” Lane worries about Foley, and says he can’t go on vacation because he has to keep an eye on Foley’s businesses. He also heads up the political side of Foley’s work — talking to county commissioners, planning boards, citizen groups, city councils, tribal leaders, governors and others. Often, locals react strongly when a billionaire buys into the neighborhood and airs ambitious development plans.
In Whitefish, for instance, there has been a backlash against Foley, who in a trademark piece of deal-making acquired a controlling interest in the stock of Big Mountain, a ski area that was built and owned by local residents. Foley’s first effort to buy the company failed, but then Richard Dasen, a local businessman and major shareholder in Big Mountain, was arrested and charged with luring girls and meth-addicted young women into prostitution. (Dasen was found guilty of five felonies, including sexual abuse of children, and recently finished serving a two-year prison sentence.) Dasen had to sell his assets in a hurry. Foley bought his Big Mountain stock, which gave him enough leverage to push through a series of reverse stock splits until he had a controlling interest. (Foley has since invested heavily in the resort, putting in new lifts and a day lodge, among other amenities.)
When Foley invests in something, he hates to go halfway. When he wanted to give to his alma mater two years ago, for instance, he gave $25 million, the single largest gift in West Point’s history, to build a new athletic center.
Politically, Foley jokingly calls himself a “cross-dresser.” He’s socially liberal, he says, and fiscally conservative. He likes California Gov. Arnold Schwarzenegger (Republican) and Montana Gov. Brian Schweitzer (Democrat). He says he’ll probably vote for presumptive Republican presidential candidate Sen. John McCain in November. His record of campaign contributions over the past 15 years would lead you to believe his politics are driven by his business. Foley gives generously across the board to Republicans and, generally speaking, to sure-thing Democrats. Since the 2000 election cycle, Foley has given $152,000 in direct campaign contributions in Florida and California, and more recently in Montana, well over half of it to Republicans, according to records kept by OpenSecrets.Org.
As for interpersonal politics, Foley has Lane, who has a talent for smoothing ruffled feathers. He is good at explaining what the billionaire is up to, which always helps. He’s also good at making alliances and strategic concessions. In Bend, Lane has helped pave the way for a private development of Fidelity Timber Resources by setting up a 33,000-acre community forest for the town. Lane has also been working with the Klamath Tribes and the federal government and others with the goal of adding to a land base for the tribes — and another development for Fidelity.
In Deer Lodge, Lane talks about the wealth of knowledge held by the longtime manager of the ranch and of how much he has enjoyed working with the Montana Department of Natural Resources and Conservation and the local government in Powell County (population about 7,000). Powell County Commissioner Dwight O’Hara likes Lane. He says Lane drops by just to talk. “He’s an old shoe,” O’Hara says. When the construction of the private club was going full bore, it maxed out Powell County’s labor force and filled the cafes, hotels and rental apartments in Deer Lodge. O’Hara says Lane and Foley have been “excellent corporate citizens, straight-forward, very easy to work with.”
Lane insisted that Foley loves the West, loves Montana the way it is, and is going to great lengths to keep things the way they are — for instance, by putting easements on areas of the ranch so the views from nearby Deer Lodge will not change. (As of mid-April, 43 of the Rock Creek Cattle Co. home sites had been sold, Lane says.)
Love for Montana doesn’t mean the regular rules of capitalism go slack. For the ranch and the golf course, designed by Tom Doak, Foley laid out an aggressive construction schedule, and he got it, mostly. His contractors say working for him is fantastic in some respects, but his management style, which some call one-strike-and-you’re-out, has made for some hard feelings. He cycled through engineers and contractors, sometimes at a dizzying rate.
It’s not as if Foley is simply mean. The first engineers hired to rehabilitate the fisheries on the ranch didn’t get the proper permits. “It was bullshit,” Foley says. The first general contractor fell behind. Foley brought on a new general who has kept up with the schedule, and the new fisheries guy works hard. Foley appreciates that.
Commissioner O’Hara says, “He gave locals a fair shot at it.”
It’s about 50 minutes door-to-door from Rock Creek Cattle Co. to Foley’s house on Whitefish Lake, if you’re flying in Foley’s six-seat black BELL407 helicopter with custom leather upholstery. (Otherwise the 220-mile drive takes about four hours in good weather.) Foley’s pilot is West Point alum and 10-year U.S. Army veteran Mike Talbot. The helicopter sports the West Point logo on its side.
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KEEP OUT: Barbed wire fences, like this one at the Rocky Creek Cattle Co. keep cows and calves in. But Foley goes further with security gates and other measures to keep people out. Photo by Anne Medley. |
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Foley also owns two jets. One is a modest Beechjet 400. The other is a huge GulfstreamV — the trophy jet of the ultra-rich (its title is held by Fidelity National Financial, which often leases it to a charter service).
Foley allowed that the culture of the Mountain West has been altered, and will continue to be, as billionaires and business executives like him seek out the quiet corners, the places where people are genuine and open. Yet he doesn’t think his own presence and his investments (which total about $125 million in Montana) inject into his new environment those characteristics of the East Coast, of California and of Florida that he would like to leave behind.
“It’s not such a bad thing that people like me are coming here,” Foley says. “Most of us are pretty concerned about things like land use. There are 300 million Americans and counting. Montana, like Wyoming and Idaho, you’re going to attract people.”
On the expansive back patio of the Whitefish house, Foley calls for Snowball, an airy puff of a Samoyed, and the dog wags his tail but doesn’t come.
Snowball eventually wanders over. Foley scratches him behind the ears. “He’s not loyal,” Foley says with feigned annoyance. “An alpha Samoyed can be squirrelly, kind of mean and bitey.” Snowball sat down on the flagstones, a big grin on his face. “Not Snowball. He’s just dumb.”
Foley gestures toward the rear of the Whitefish house. Like a lot of rich people across the Mountain West, he idealizes “authentic” relics and materials. Real weathered barn wood, for instance, is big with this crowd, creating the sense of house-as-extended-mood-piece. Foley may have a twinkle in his eye and a genuine smile, he might foster a few of his Montana employees in an almost fatherly way, but he remains a sharp-edged executive isolated by security gates and thousands of acres. The barn wood seems to offset the exclusivity, rendering it less uncomfortable.
“The idea is that it’s like an old Montana ranch house, and then you add onto it,” he says, describing the theory behind the rambling architecture. Foley points out the lack of uniformity in the size of the weathered Kentucky oak logs and the chinking between them.
“You just put up the logs, and then you chink it to fit. The idea is for it to be a little understated, to look like it’s old,” he says.
Artwork, from a gallery south of Missoula, had been hung on the walls that day. Provenance papers listing the artists and the prices lie on a table. Foley walks around the ground floor with his wife and takes in the original paintings. Four of them in a stairwell reflect too much light from a big window on the landing. Those will be sent back. Another one in the entryway Foley deems too colorful. He and Carol both really like a large painting in the living room by Ace Cooper entitled “End of a Perfect Day.”
The two admire it for a moment and say they find it relaxing.
In the painting, two cowboys in the foreground pick their way across a dry landscape of sage and rocks toward a distant homestead at the base of a high ridge. The entire scene, which has hints of autumnal reds and oranges, is bathed in early evening shadow, except for a distant ridge, which glows with late sunlight. There’s not a fence in sight.
For Those Who Suffer for the Trust…
Check out that look of concentration as I asked questions and scribbled down the answers into my narrow reporter's notebook. Photo, I believe, by Scott Martin, one of Montana's delegates to the 2008 Democratic National Convention.
I’m sure you’ve had this experience—you catch a lyric in a song, and it suddenly embodies your struggle. This was my line: “They don’t pay me enough to suffer for the trust, I’ve got to take what’s mine before the cause gets just.”
The song was “Suffer for the Trust,” by a Chicago band called the Ike Reilly Assassination. It was the summer and fall of 2006. Early the next year, I quit my job as a reporter at the Missoulian, a job I dearly loved.
I don’t know what the musicians meant with those lyrics, but I sure as hell know what those words meant to me. “They” was Lee Enterprises, and “the trust” and the “cause” were daily journalism. That summer, I had learned that my annual raise would be something like half a percent, all and more of which would be eaten by the rising cost of our middling health insurance, even though the Missoulian had taken more than $5 million in profits that year.
The painful truth—that Lee Enterprises bled me every day because of my love of journalism—became like a bit of grit in my heart, an irritating piece of something that never gave me peace. I had a vision that my future was slowly being taken away from me. I mean that literally, not metaphorically. Instead of getting closer, my dream that I could raise my family and someday help my kids through college was slipping away.
You need to understand just how much I loved being a reporter. It’s deep within my blood. Before I could write or spell, I drew pictures and dictated stories to my mother, who then bound the pages into books with her sewing machine. And, believe me, I could bore you all afternoon with polemics about the importance of narrative, of accurate language, of the stories of a community.
I loved reporting and writing in Missoula, a town where I had spent much of my childhood and where two of my grandparents were buried. In those days, I taught a class each fall at the University of Montana’s journalism school. At that newspaper, I was able to do my life’s work….
The Missoulian is one of five Montana newspapers owned by a publicly traded company called Lee Enterprises. The company is based in Iowa, which gives an inkling of its small market roots. In 1998, with a fresh master’s degree from UC Berkeley’s journalism school, I got my first reporting job at the Billings Gazette (which I had delivered every morning during junior high school). Back then Lee owned a couple dozen daily and weekly newspapers mostly in the Midwest and the Great Plains. Rumor had it the Gazette‘s annual profit margin was an ungodly 40 percent, or at least the high 30s.
You’ve got to remember that by the late 1990s, pundits had been declaring newspapers “dead” for years, but nobody told Lee. If you retain one truth about this company, make it this: It’s leaders know how to squeeze dollars out of its papers. A lot of dollars.
For decades in smaller markets across the country, newspapers practically printed money. Prudent stockholders saw them as wise investments, with steadily rising stock values and generous dividends in good times and bad.
Yet almost every newspaper also held a special trust—a balance against its function as a business—as a community’s public record, the Fourth Estate. And publishers often felt that trust personally, its obligation. During the 1980s, that dynamic began to change.
Interestingly enough, Lee Enterprises—this chain of smallish backwater newspapers—helped lead the trend on the national media landscape toward a profits-at-all-cost approach. For instance, Wayne Schile, the publisher of the Billings Gazette in the 1980s and much of the 1990s, dramatically cut staff, raised subscription and ad rates and produced ballooning profits. The stories I heard about him… how he sacked the newspaper’s long-serving and dedicated librarian and then sent her life’s work of file cabinets and carefully cataloged clippings to the landfill… how he’d call one group of reporters into one meeting and fire the remaining, were moves that seemed designed to trash morale and heighten reporters’ innate paranoia.
This model of the no-frills newspaper spread throughout the Lee holdings, and across the industry.
Media was diversifying fast. The Internet was becoming a part of our everyday lives. News delivery seemed to shift overnight. And yet Lee continued its incredible profits, even as other newspapers in the early 2000s went dark in markets like Seattle, Denver and San Francisco, despite a real estate bubble that buoyed overall media incomes.
In June of 2005, Lee was the minnow that swallowed the whale when it purchased the venerable and ailing Pulitzer chain of newspapers. The purchase transformed Lee from an unknown, insignificant chain into one of the nation’s largest. It now owned the St. Louis Post Dispatch, one of the nation’s premier newspapers, and dozens of others, including some which had probably not been profitable for a decade.
The purchase was amazing because it was entirely financed, all $1 billion.
What was going to repay that debt? The incredibly profitable newspapers in Missoula, Billings, Helena and other places, like Sioux City, Iowa.
The logic was, if Lee could make such major cash in these small towns, just imagine what could be done on a larger scale!
And yet the opposite was true. Lee Enterprises thrived in isolated markets against little or no competition. In a market like Missoula, the newspaper has a handful of competitors for ads. In major urban areas, a newspaper has hundreds of quality competitors.
The summer of the Pulitzer purchase, I had been working as the business reporter at the Missoulian for a year and as a journalist for six or seven. My Lee stock, which was my retirement plan, was almost $50 a share. I remember checking the website of the Securities and Exchange Commission that June or July, and seeing a filing that said the Missoulian publisher had sold something like 100,000 of his own shares. That didn’t seem to bode well…. I wondered about that….
The details of the Pulitzer repayment plan required huge balloon payments to Deutsche Bank. Each of those payments seemed really big, as I recall, like a hundred million dollars or more. To amass money for those payments, our already austere paper got even tighter. Nobody could clock overtime. Reporters drove their own vehicles, and got reimbursed at less than half the government rate even as gas prices went through the roof.
Companies can only pull this kind of crap with an insecure workforce, and we were. I knew back then that the only way we’d have a fair shot at a decent life was by joining together. Without some leverage, none of us could negotiate for jack. Yet after only a few evening conversations with my fellow reporters about the nuts-and-bolts of forming a union, I got a wave from my editor Mike McInally (a man for whom I somehow still have tremendous respect and affection) calling me into his office. After asking me to close the door, he said, “I’ve heard you’ve been talking to people about unions. If I ever hear that again, you’re fired.”
His words (a textbook example of illegal workplace coercion) stunned me, my shit-eating grin frozen on my face. To save my job, I shamelessly disavowed my intentions, while my editor insisted that he loved my news stories and positive attitude and didn’t want to get rid of me. A few minutes later, humiliated and furious at myself, my heart pounding and my hands shaking, I returned to my desk and stared at my computer screen. I promised myself that I was done trying to help anyone else. From then on, I would do for me.
So maybe it’s no wonder that “Suffer for the Trust” became my anthem, that I left my job a few short years later, that wonderful job that didn’t feel like work at all, for a high-paying gig at a hateful little boutique communications firm where I didn’t last a year.
Later, as I bounced around in search of a new way to follow my calling, Lee Enterprises hit snag after snag. Each time it punished its workers—several of them my closest friends, and many for whom I have tremendous admiration and professional respect—with layoffs and benefit cuts. Still, Lee’s stock value kept dropping until it reached its nadir, a few cents over a quarter. My retirement portfolio—and more importantly, the portfolios of my friends and former co-workers—had become basically worthless. In late 2011, the corporation filed for Chapter 11 bankruptcy protection.
So it came as no surprise early this year when rumors foretold of more job losses. The news hurt, last week, when 10 of the company’s Montana employees confronted the sudden prospect of unemployment in this bleak economy, especially as word of the latest bonus of $500,000 for Lee’s CEO Mary Junck came out at almost exactly the same time.
It’s easy and appropriate to blame Junck and her thuggish clutch of publishers, including my old editor Mike McInally who served as publisher for a pair of papers in Oregon, last I heard. That class will never do right by journalism.
And yet the reporters and copy editors, the support staff and press operators continue to do as much as possible. In fact, I think the Billings Gazette, which has a fantastic editor and incredible writers, has been producing better journalism, including thoughtful and provocative editorials, than it ever has.
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Filed under News and Commentary, Raw Material for a Memoir
Tagged as Billings Gazette, culture, Ike Reilly Assassination, Journalism, Lee Enterprises, Missoulian, Montana, Robert Struckman