The Takeover

by Stephen W. Frey

  The waiter returned with the espresso. They sat in silence as the man put down and arranged the saucers, cups, and a small pot of the rich coffee. He departed quickly, sensing that his presence was not appreciated.

  “So, you want to know something about me?” Falcon began, breaking the silence. Somehow he knew Cassandra was not lying about her past to engender confidence in her subject. He knew she was telling the absolute truth. He could read a face, and he had seen the pain in the corners of her mouth at the thought of the son she hadn’t seen in so long.

  “Don’t feel sorry for me, Andrew. It’s okay. I made a mistake when I was a kid. But I’m all right.”

  Falcon waved a hand. “Hey, I don’t feel sorry for anyone who wins three hundred dollars in a half hour of gambling. And we’re supposed to be talking about me here anyway, right?”

  “Yes.” She laughed as she poured espresso for both of them.

  “Don’t you need to pull out a notepad or something?”

  “Oh, right, you civilians think all reporters wear brown fedoras and carry notepads, and you don’t feel comfortable talking to us unless the notepad is in full view. Kind of like the psychiatrist and the couch thing. Jesus, I would think you wouldn’t want me to write anything down.”

  “Enough.” Falcon held up his hands. “I’m from eastern Pennsylvania. I attended the University of Pennsylvania and then Harvard Business School, after which I went directly to Winthrop, Hawkins. I left Winthrop, Hawkins—”

  “—to start MD Link with Reid Bernstein,” Cassandra interrupted him. “I knew that. I knew about Winthrop, Hawkins too. As a matter of fact, I can even get as far back as your second year at the University of Pennsylvania. But I don’t get anything before that. Not on any of the information systems I have. It’s as if you started life in that year.”

  “You’ll have to dig deeper.”

  “What about your family?”

  “When I left home for college, I left for good.”

  “What happened?”

  “I had an argument with my father.”

  “Lots of eighteen-year-old boys have arguments with their fathers.”

  “That’s all I’m saying.”

  “Not going to make this easy for me?”

  “I just don’t think there’s any reason to include background on me in this article. People won’t be that interested.”

  “I think if we include a sketch, you might get some fan mail from a few women.”

  Falcon smiled at her.

  “So, do I get my story?” Cassandra asked.

  “Let’s go for a walk in Central Park. I’ll tell you everything you want to know about the Penn-Mar deal and Wall Street in general. It will make for a very good article. There’s lots of good scoop.”

  Cassandra smiled and nodded. “Great, let’s go.”

  Falcon rose from the table and helped her from the chair. “And we can finish it up over a nice dinner.”

  Cassandra shook her head, still smiling. “Oh, Andrew,” she sighed.

  “What?” His face looked like that of a young boy with his hand caught squarely in the cookie jar.

  “You’ve got those thoughts of interracial sex dancing in your head.”

  “I do not!” Falcon protested vehemently.

  “Besides, I already have a dinner date tonight with my lover.”

  “Cancel it. I’m much more interesting.”

  “Really?” She smiled at his bravado.

  “Absolutely.”

  Cassandra laughed. “She’ll be surprised to hear that.”

  26

  “Andrew Falcon, this is Henry Landon, president of Penn-Mar Chemicals,” Chambers said, making the introduction.

  Falcon glanced at Chambers. The man looked a good deal better than he had in New York. There was actually a bit of color to his hollow cheeks. Perhaps a few days as the new Penn-Mar chairman and the lack of stress from the takeover were the prescription he needed. Falcon still had been unable to determine exactly what was wrong with Chambers. He had asked Barksdale on the flight out from New York that morning, but Barksdale didn’t know or wasn’t saying.

  Landon shook Falcon’s hand. Falcon could feel the perspiration in his hand. Chambers had already been out here for a week. What the heck was this guy so nervous about?

  “A pleasure to meet you, Mr. Falcon. Call me Dutch.” He spoke with perfect diction, enunciating each syllable.

  “Okay, Dutch.” Falcon judged Landon to be about sixty. He was of medium height, balding on top, and his stomach was creeping over the wide belt holding up his brown polyester pants. Landon had clearly come up through the engineering side of the company. Falcon already knew Landon’s background from reading the company’s annual 10-K report as well as articles off Bloomberg and Lexis/Nexis. But you could tell so much more by meeting a man than by reading about him.

  Landon wore a yellow, short-sleeved, blend shirt—the tiny balls of material around the neckline alerted Falcon to the fact that the shirt was not all cotton. The plastic protector inserted into the shirt pocket was filled with different colored pens and a small calculator. Landon’s glasses were thick, smudged, and dusted with dandruff. Physically, he was about as impressive as a ladybug. He must have known the hell out of engineering.

  “And this is Lex Sotos, chief financial officer.”

  Falcon’s focus shifted. Sotos did not speak as they shook hands. His palm was completely dry, devoid of perspiration. And it was cold.

  So here was the spit and polish of Penn-Mar Chemicals. If Landon was Mr. Inside, then clearly this was Mr. Outside. Sotos was tall, almost six four, and in excellent physical condition. He could have been anywhere from forty-five to sixty-five. The dark, faint chalk-striped suit fit perfectly in all the right places. The white pima dress shirt was crisply starched, and he wore a startlingly red tie, decorated with blue giraffes. The suit coat was buttoned and the pants were cuffed. His face and hands were deeply tanned. Clearly this man did not miss many opportunities to play the company golf course, which surrounded Penn-Mar’s headquarters building.

  Sotos quickly withdrew his hand from Falcon’s. He was arrogant to the point of being insolent. Obviously, in his position as CFO, he believed that NASO needed him more than he needed NASO. Because he knew where every nut was stored and every mine was buried. He knew everything about the firm’s financials, things no one could discern from the public statements. He could make life very difficult for NASO if the bank and Veens weren’t accommodating. That was his view.

  “And this is Phil Barksdale, vice chairman of the National Southern Bank.” Chambers completed the introductions.

  Barksdale shook hands with both Penn-Mar officers. Sotos was only slightly less condescending to Barksdale than he had been to Falcon.

  Pleasantries completed, the five men took seats at the plain boardroom table. Landon and Sotos sat on one side, while Chambers, Barksdale, and Falcon sat on the other. They weren’t all on the same team yet. It would take some time. It always did, Falcon thought.

  Falcon watched as Landon and Sotos took their seats. Landon’s eyes moved constantly as he leaned forward over the Formica-topped table, hands clenched before him. Sotos leaned back and stared at something on the wall above Falcon’s head. Falcon smiled. This was going to be fun.

  “We certainly appreciate you two gentlemen taking the time to meet with Falcon and myself today.” Barksdale’s deep voice rumbled throughout the room. “And I want to thank my friend Devon Chambers for setting this up.” Barksdale gestured toward Chambers.

  “Let me tell you, Lex and I have had a wonderful opportunity to get to know Devon over the past few days,” said Landon, “and we certainly think he and Veens will bring a great deal of knowledge and experience to Penn-Mar. We look forward to our association with Veens, as well as with the National Southern Bank.”

  It wa
s all Falcon could do to suppress a smile. The guy was so stressed he was almost spitting on himself to get the words out. He wanted to make certain they liked him. Bhutto had really misjudged this one. When the hostile bid had first been announced, he must have told these guys all kinds of crap. Falcon pictured the Indian convincing Landon and Sotos that there was no chance Veens would win the battle and how they didn’t have to worry about sucking up to some clowns from an obscure investment boutique. They had probably all laughed long and hard. In their wildest dreams, these two men had never believed that this meeting would ever take place. Falcon sensed it. Now they were being hit over the head with the fact that they no longer controlled Penn-Mar. They were coming to the realization that they had bosses again—Chambers and Barksdale. They could no longer run the company as their own empire, disregarding the public shareholders as they probably had for so long. It was interesting to see the different reactions. Landon was worried about his job, Sotos about his pride.

  Barksdale coughed. “As you both are well aware, National Southern is not only a coequity investor with Veens in the transaction. We are also the agent for the consortium of domestic and international banks that provided twenty-eight billion dollars for the deal. We felt it was important to get out here and meet face-to-face as quickly as possible. So, here we are.”

  “Yes, here you are.” Sotos’ tone was sarcastic. “What percentage of the shares did you get in the tender?”

  “Ninety-eight point six percent.” Falcon offered the detail. “We closed out the other one point four percent with a back-end merger yesterday.”

  “That’s an appropriate term.” Sotos laughed caustically. “Back-end merger.” His tone was bitter.

  “Easy, Lex.” Landon smiled nervously at the men across the table.

  “Anyway, we are planning on having a meeting here in Toledo for all of the banks next week. Andrew will be in charge of that.” Barksdale waved a hand in Falcon’s direction. “And the week after that, we will have a meeting for potential junk-bond investors.”

  “How much does NASO have in this deal, Barksdale?” For the first time Sotos leaned forward in his seat.

  Barksdale took a quick look at Chambers, who nodded subtly. “At this point, thirteen billion. Three in equity from funds we control, six in subordinated junk bonds, and four in senior bank debt.”

  “So Veens is a front. You guys are the real owners.”

  “Veens owns seventy-five percent of the voting shares. Most of the securities we bought do not allow us to vote.”

  “That’s a pretty good deal for your friend over there.” Sotos nodded at Chambers.

  “We believe this is a good deal for all of us,” Barksdale said.

  “Okay, what’s in it for management here at Penn-Mar?” Sotos asked, his tone becoming confrontational.

  “Lex, please.” Landon was visibly shaken.

  “That’s all right, Dutch.” Chambers’ breathing was labored, but he still managed to smile evilly at Sotos.

  It was the second time Falcon had seen that look. It was a look he did not care for.

  Chambers continued. “Dutch, we’re going to offer you a rather nice employment package, one which we will go over with you in detail later this afternoon. We are excited about having you stay on.”

  The room was quiet for a few moments.

  Sotos glanced around. “And me?”

  “Falcon.” Chambers pointed at him.

  Falcon did not hesitate. “Lex, my boy, are you a golfer?”

  Sotos’ eyes shot to Falcon. His eyes were filled with disdain. Falcon was going to enjoy this.

  “Yes.” Sotos’ voice was suddenly rough. The cool had melted like an ice cube in an inferno. He suddenly realized that he had misjudged everything.

  “Well, good. Because you’re going to have lots of time to play. But you won’t be playing on the Penn-Mar course. You’re fired,” Falcon said coolly.

  Barksdale had informed him on the plane that he would be firing Sotos. Chambers found him arrogant and incompetent. Falcon had protested. It would make selling the bank debt and the bonds more difficult. You didn’t fire the CFO and expect to excite potential investors. But Barksdale didn’t care. He had his orders from Chambers. Chambers was the general and Barksdale just a sergeant. But it was a chore Barksdale did not relish. Down deep, he hated confrontation. So he was going to pass the buck to Falcon. Because he could. Because he was the vice chairman.

  “What?” Sotos stood, a look of disbelief consuming his face instantly.

  “Fired.” Falcon didn’t mind the chore now. This guy was an asshole. He wouldn’t have gone over very well with investors anyway. “You have a half hour to clear out. You will be monitored by a security guard while you are packing your possessions.”

  Sotos stared openmouthed down at Falcon. “You’re out of your fucking mind!” he screamed.

  “Probably, but that’s the deal.” Falcon smiled at Sotos. He had been right. It was fun.

  Sotos turned toward Landon for help, but Landon refused to make eye contact with what had just become his former partner.

  * * *

  —

  Penn-Mar’s headquarters reminded Falcon of the Goodyear Tire & Rubber Company, across the state in Akron—he had been close to Goodyear when he was with Winthrop, Hawkins. The Penn-Mar building was just four stories high, but it was long and wide and had hundreds of thousands of square feet of office space. Like so many midwestern manufacturing headquarters, it had been constructed in the 1950s, when largesse was in vogue and efficiency and downsizing were not part of a CEO’s vocabulary. Now Penn-Mar needed only half the space. A result of several rounds of “synergy layoffs” over the past few years. The entire wing he was now exploring was all but empty.

  The long, tiled corridors stretched on endlessly, leading to hundreds of offices, only a few of which seemed to be occupied. The corridor was faintly lit by gaudy chandeliers burning low-wattage bulbs. The walls were lined with long glass cases framed by dark wood. The cases contained black-and-white photographs of old manufacturing sites, replicas of early products, trophies of winning company bowling teams, and awards for outstanding corporate citizenship.

  Falcon stared at a picture of a softball team, one member of which held a plaque inscribed 1964 Champions—Indianwood Summer League. He smiled. The men all sported crew cuts. He breathed deeply. The venerable hallway was musty. It reminded him of his old public high school in Philadelphia.

  Falcon turned from the picture and walked slowly down the corridor. His steps echoed in the lonely hallway as he walked. Sotos’ dismissal had turned ugly. He had started screaming about suing Veens, and they had called a security guard to escort him out immediately. They hadn’t even given him the time to gather his belongings. Falcon knew how that felt, but he had no sympathy for Sotos.

  Chambers had suggested that they take a break once Sotos was gone, and everyone quickly agreed. So Falcon had gone for a walk. He enjoyed architecture and old buildings and he needed to relax, to work off some excess energy. And he wanted to find Chambers’ office.

  Falcon moved farther down the long, shadowy hallway. Cassandra’s Financial Chronicle article was due out soon. He had spent three hours with her in Central Park after lunch. During that time he had recounted the takeover in detail. He had given her an inside look at the biggest takeover ever, and at Wall Street. She had been appreciative, as she should have been, and against her better judgment had promised to show him a draft of the article just prior to publication.

  He had called her references yesterday, people she had worked with, and as he had anticipated, she checked out. People had nothing but good things to say about her: honest, trustworthy, fair, thorough.

  Falcon stopped to look at another photo. He did not want to seem too purposeful and arouse the suspicion of anyone who might see him. Occasionally someone would come out of what look
ed like an abandoned office. He stared at the picture in the case without seeing. There were so many questions. He ought to leave it alone. Forget about it. But he couldn’t. It wasn’t his nature. And he knew of only one place to start looking for answers without raising red flags. But he had to be so careful.

  Chambers’ office wasn’t listed on the corporate directory yet. Falcon had checked with the receptionist on the way in. So he would have to find it himself. He had followed Chambers at a safe distance after the boardroom meeting had broken up, but, not wanting to make his objective obvious, he had turned off into a rest room the second time Chambers had looked over his shoulder. Now he was lost in the labyrinth of the mammoth building.

  A tapping sound emanated from the office at the far end of the waxed hallway. It was like a flashing beacon in the dead of night, and he headed for it.

  “Hello.”

  The middle-aged secretary stopped typing and looked up at him over horn-rimmed glasses.

  “How are you?” He tried to play the nonthreatening, hometown boy, but the power tie was a dead giveaway. She knew that no Toledo native would have the gall to wear that.

  “May I help you?”

  “Yes. I’m looking for a rest room.”

  “You’re a little off the beaten track, aren’t you?” She was suspicious. This part of the building was abandoned for all intents and purposes. People didn’t look for rest rooms here.

  “I suppose.” He paused. “Actually, I was also looking for Mr. Chambers’ office. We need him back at the boardroom meeting.”

  “Why didn’t you just call him?”

  Falcon smiled at her. He was close. This had to be Chambers’ secretary. Why else would she be so protective? “Just wanted a little exercise. I must say this is a beautiful building. Was that you I saw in the picture at the other end of the hallway? The one holding the bowling trophy for last year’s team.”