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You are here: Davis of Iowa > Jim Davis's Biography > Part IX                    Click HERE to go to Part X

Part IX



My Great Lakes Carbon Years




Another change in my career path -


In the middle of 1984, I was approached by a HBS ’65 classmate and fellow study group member,  Bill Gould, who was an executive search executive.  He was recruiting candidates for a Senior  Vice President of Manufacturing, Research and Engineering position with a $1 billion in sales privately held New York City based company. 


The company was Great Lakes Carbon (GLC), a manufacturer of carbon products.  The company was founded  in 1919 by the George Skakel Sr. along with a partner, William Gramm who held a 25% ownership.  The company was formed to market carbon fine powder/dust from coal processing operations to companies which used these fines as a source of carbon in their chemical processes. As he travelled about Illinois,  somewhat later Skakel observed immense piles of petroleum coke, essentially  carbon left from  processing of crude oil into its various fractions, on the refinery sites.*  The refining industry had recently introduced the coking process to their refinery operations to improve the total value of the refined products from the petroleum.  Gasoline production is maximized with this additional process thereby increasing the total value of the petroleum products.


However, the refiners had not developed a market for petroleum coke, a residue of the process and consequently stored the “coke” on the refinery site until a market/use was identified.   Mr. Skakel who was already marketing coal fines as a source of carbon, reasoned that the petroleum coke could also be sold as a source of carbon or as an alternate fuel.  He began contracting to purchase a number of refineries’ total production of petroleum coke.  Concurrently, he began calling on various manufacturing operations, e.g., cement processing kilns, power plants and other major users of fuel, and convinced those  prospective customers to incorporate this petroleum coke into



*Crude oil is “fractionally distilled” into its various marketable components in the refining process.  The  components are separated based on their volatility.  Typically, the most volatile components are petroleum gasses/solvents/chemicals, next is gasoline (the most valuable component because of quantity and price), then kerosene/jet fuel, then diesel fuel, then industrial heating fuel and then asphalt.  In a process called coking, the heavy fractions, i.e., what is typically the very heavy fuel oil and asphalt, are further processed by “cracking” this portion of the petroleum into more volatile products, principally gasoline with a residual solid product called petroleum coke.  This coke is almost exclusively carbon with very minor amounts of metals/solids as impurities.  It is a valuable source of carbon and fuel for industry.


their fuel usage.  He was so successful that the Securities and Exchange Commission filed a complaint that Mr. Skakel’s had created a monopoly in petroleum coke.  They settled with an agreement that Mr. Skakel would not contract to purchase petroleum coke from any other Midwest refineries.  Mr. Skakel was so successful in this endeavor that he was wealthy within ten years.


The company expanded its sales into calcined petroleum coke in which all of the volatiles remaining in the raw petroleum coke were vaporized and the calcined coke was essentially pure carbon.  This product found a very large market as the principal ingredient in the manufacture of anodes for the electrolytic manufacture of aluminum metal.  The carbon in the anodes reacted with the molten aluminum oxide (alumina) to create carbon dioxide which escaped the bath of molten alumina, while the aluminum metal attached itself to the aluminum sheet cathodes thereby plating out relatively pure aluminum metal.  The aluminum market expanded significantly during WWII, particularly for the manufacturing of airplanes.


During WWII the U.S. Government undertook the manufacturing of many materials that were critical to the war effort by financing some manufacturing plants and contracting with various companies with the management expertise to build and to operate these plants.  One of those materials was graphite which was critical to the immense nuclear bomb program.  Graphite use was also increasingly needed for electrodes in the recycling steel from scrap steel.   After WWII, the U.S. Government sold  these plants which were no longer needed for the war effort.  Great Lakes Carbon purchased two graphite facilities at that time and entered into the graphite electrode market and selling specialty graphite for various other processes.  


Thus, GLC had three major businesses, the resale of petroleum coke, the calcining of petroleum coke and the sale of graphite, primarily graphite electrodes for the recycling of steel.   Such was their business at the time Karen and I considered interviewing with GLC for the position of Senior Vice President of Manufacturing.  We decided that a change in careers, hers and mine and a change in geography might be appropriate at this time in our lives.  I accepted the offer of visiting with the GLC management at their Park Avenue, New York City offices. 


I met with the GLC senior management, which was led  by Dr. John Sacks the CEO, an engineer who had joined GLC in 1966 succeeding  George  Skakel, Jr., the previous CEO, who was killed in a plane accident in 1966*.  Sachs was recruited from Union Carbide where he served in their carbon business, including graphite, of which Union Carbide had the largest market share.  Also, among the interviewers was George Skakel III, the son of George Skakel Jr., who was the GLC treasure and part owner of GLC,  Mike Wrotniak, Sr. Vice President of Marketing and Jim MacKenzie a young attorney who was GLC’s in-house counsel.   I also met with the retiring Sr. Vice President of Manufacturing a long time GLC executive who was retiring to a life of enjoying sailing his recently purchased sail boat.  He had a scheduled trip planned from Montreal, Canada through the Great Lakes, down the Mississippi River and back up the east coast of the U.S.  He had a firm retirement date  with not much time to orient his replacement. 


During the interview I learned that GLC was to be sold as the current owners, especially the seven Skakel children or their heirs in the case of George Skakel Jr., had large families most of whom lived large off their share of the GLC earnings.  They  wanted more funds from GLC than were being generated by the GLC operations.  None of the seven children, except Ethel who had married into the Kennedy family fortune, had independently been successful at a career or married into  wealth.  The only way to access more funds from GLC was to sell the company and have one last windfall.  George Skakel III thought that he might be successful in putting together a group to purchase GLC and shared with me his thoughts and plans.  Each of the seven families descending from George Skakel Sr. had a place on the board as did the Gramm family.**  George Skakel III represented his sister and himself the only two descendants of George Skakel Jr. 


*George Skakel Sr. and his family moved to Greenwich, CT and moved GLC’s corporate office to New York City.  They had seven children, including George Jr. and Ethel.  Ethel married Robert Kennedy as a testament to the society that the Skakels joined when they moved to CT.  George Jr. was the only one of the seven children to which George Sr. would entrust the business.  George, Sr. and his wife were killed in the crash of the GLC corporate plane in 1955.  George Jr. became CEO and he was in turn killed in a crash of a small plane in which he and several others of his elk hunting party were traveling on their way to an Idaho hunting site in 1966.  George Jr.’s son George, III was on the second plane flying the rest of the hunting party to the site.  George III saw the plane his father was on crash into the mountain.  George Jr.’s wife and mother of George III died shortly thereafter choking on food while dining in her home. 


**Each of the three other sons of George Skakel, Sr. served on the board, with Rushton Skakel the oldest son being Chairman of the Board.  The three daughters one  of whom was  Ethel Kennedy, Robert Kennedy’s wife - were not permitted to serve on the board and were required to nominate a male representative for the board.  George III explained to me that “the men in the Skakel family get the company and the women in the family get the silver ware!”


My all-day interview went well.  John Sachs was a low key executive, clearly walking a fine line in trying to satisfy the varying, sometimes conflicting interests of the board and the individual Skakel families.  The company was reasonably profitable, served several major markets with high quality products and was clearly destined for transition from a private company managed to maximize the owners needs to probably a company owned by a private equity group. 


The next day, Bill Gould phoned me that GLC was preparing an offer for me for the position.  I received the offer via FedEx the day following at home.  Karen and I discussed the offer, the pros and cons of leaving AOI, which at some future date might require us to relocate to Ashland, KY. That and the possibility of living in/near New York City with all of the new adventures that this might represent were enticing.  A move would require her to sell or liquidate The Needleworks.  I was somewhat disenchanted with my AOI position  and with the prospects of becoming AOI CEO or any other AOI position in the very senior management ranks as other contemporary officers seemed to have inside tracks.   I was interested in a new challenge.  The prospects of possibly joining George Skakel III in purchasing GLC was intriguing.  After sleeping on the offer and further discussing it, Karen and I decided to take the offer and go to New York City.


I gave my two week notice to Bill Seaton who accepted it with grace and gratitude for my employment with AOI.  I was particularly pleased that John Hall the man in AOI senior management whom I most admired, came to my office, congratulated me and said that he would miss me at AOI.  Two weeks later I was off to New York City to begin working with GLC.  Great Lakes Carbon had an apartment in NYC close to the office which I was assigned to for our transition to NYC.  I was able to spend just two weeks with the executive I was replacing before he entered retirement.  I also spent some of that time scouting out apartments in Manhattan for Karen and my possible relocation.


Karen came to NYC the first weekend to look at apartments with me.  We had not prepared well for the shock of NYC residing and after looking at a number of apartments we came to the conclusion that we were not prepared to pay the rents asked for the apartments that we considered acceptable and decided to look in nearby southwest Connecticut, where several GLC executives lived, including John Sacks who lived in New Canaan, CT.  The following weekend, we were shown a number of houses for purchase in Stamford, CT, also very much a commuting suburb of NYC.  We quickly chose a new house, nearly completed in a new Stamford development called Doral Farm.  It was a small wonderful community of 26 new homes on 15 acres very near the Merritt Parkway.  The house we purchased was a three bedroom two story colonial style house in a very quiet development which was nearly sold out and occupied.  We would have occupancy in two months, which provided Karen time to wind down The Needleworks and me time to travel to all of the GLC manufacturing and research facilities for which I had responsibility. 


Great Lakes Carbon had a company plane, a modernized DC 3, based at the nearby private Westchester County Airport.  CEO Sacks scheduled a  whirlwind tour of five GLC plants using the company plane.  One of the plants we visited was the Morgantown, NC graphite plant.  At the time we were in North Carolina, my parents were in Greensboro, NC visiting my mother’s cousin, Willard Ware who was dying of pancreatic cancer.  I asked CEO Sacks if we could spend a couple of hours in Greensboro while I paid a short visit to tell Willard goodbye.    It was a difficult visit for my parents and for me to tell such a great family member good bye.  On the trip we also visited GLC’s newest graphite electrode plant in Ozark, AR just outside the Fort Smith.  The third stop was at the Enid, OK and the fourth in Port Arthur to visit GLC’s two petroleum coke calcining plants.  It was a quick orientation to the old (Morganton) and new (Ozark) graphite electrode manufacturing plants and to the coke calcining plants.   The following several weeks I visited the two GLC Canadian plants, an old and a new graphite electrode plant both located near Montreal, the Niagara Falls, NY graphite plant, an old style graphite manufacturing facility which produced various sizes and shapes of graphite for specialty operations and the GLC research and engineering center in Knoxville, TN. In addition,  GLC had a graphite plant in northern England which utilized the same graphite technology as the Niagara Falls graphite plant.  Also, GLC had two  joint venture petroleum  coke calcining plants in India and a large new joint-venture petroleum coke calcining plant in  Buenos Aires, Argentina.


The Knoxville, TN facility also included graphite fiber research and a pilot plant facility, as graphite fiber was finding increased market in a variety of applications because of its tremendous tensile strength to weight ratio, e.g., as a reinforcing member of reinforced plastics.  GLC was working hard to enter this growing new business.


I spent the following week visiting GLC’s Niagara Falls, NY plant and graphite marketing and customer service offices, which overlooked the Canadian portion of the  Niagara Falls and in getting to know the other officers and employees in the NYC office.


I returned to Columbus, on the third weekend of my employment with GLC.  Karen was making progress selling her inventory and winding down The Needleworks.  She met me at the Columbus airport in her brand new Dodge Dart convertible.  It was a glorious day weatherwise so she had the top down and was beaming ear to ear.  I asked her about the car and she proudly told me she bought it with the proceeds from liquidating The Needleworks inventory.   It was a whirlwind of a time, selling our Westerville condo, winding down The Needleworks, arranging for the moving our furnishings to Stamford, CT and saying good bye to our many Columbus area friends. 


The closing on the purchase of the Stamford house and the sale of the Westerville condo, the move of our furnishings to Stamford  and the occupancy of the new house all went reasonably smoothly.   We settled into the Stamford house very easily. We had become familiar with Stamford and its surrounding area somewhat in the several house hunting trips to Stamford and drives from there into NYC.  Karen had decided that she was finished with retailing and was going to take a crack at being a real estate agent.  She began researching the requirements and opportunities.  She enrolled in a class preparing prospective agents to pass the required state exam for real estate agents.   She passed the exam, received her license and acquired a position at local real estate agency which concentrated on Stamford real estate.  She was excited with the opportunities to learn more about the Stamford area and history, to meet people in our new home town and to pursue a real estate sales career.  Karen continued her smoking and drinking to a degree that was uncomfortable to me and to her daughters, all of us whom discussed it with Karen to the degree she would converse about it – which was very limited.  At this point she did not appear to have adverse health effects from either and had no interest in changing these habits.


Our new home location was an excellent choice, in part since John Sacks who not only had a company car, had a personal driver for commuting to the office.  They travelled the Merritt Parkway on this commute.  Even though I had a company car as part of my executive compensation package, John told me that he would be delighted for me to commute with him.  There was a carpool parking lot very convenient to the Merritt Parkway where I would leave my car and ride to and from NYC with him.  


Great Lakes Carbon senior management met every Monday morning in the NYC office to coordinate and plan GLC’s business.  Rushton Skakel, chairman of  the board, whose office was adjacent to mine, was in the office most Monday’s and attended these meetings.  He never once made a comment in any of the meetings which I attended.  He may have made his feelings known to CEO Sacks, but I never asked Sacks. 


The GLC board met quarterly only two of which I attended, as the board had already retained advisors to  handle locating and qualifying prospective buyers of GLC.  There were no candidates making the final cut who were competing in the carbon/graphite markets.  George Skakel III and I met  with the advisors and discussed the possibility of us putting together a group to make a bid for GLC.  We were encouraged to do so,  however, George III had greatly overestimated his ability to access the necessary funds to make a competitive offer. The final candidates were entrepreneurial  firms which wanted to purchase the GLC assets and greatly reduce what they considered the excess corporate costs, e.g., the Park Avenue office lease had some 15 years remaining at a lease cost very much below the then current market, the corporate airplane, the excessive number of company cars  - mainly in the Skakel family – and several entertaining venues used for marketing purposes, but also used by the Skakel family.


Bradley Jake Holub, our first grandchild is born –


On Sunday, November 4th, Karen and I received a phone call from our daughter Cindie and her husband, Brian, announcing that we were grandparents of a beautiful baby boy, whom they had named Bradley Jake Holub.  Mother and son were doing fine they expected to be home in a couple of days and wanted us to come to Nashua to see our grandson.  We agreed and eagerly looked forward to seeing Bradley.  The week drug a bit waiting for Friday afternoon to drive to Nashua.  Karen and I had visited Cindie and Brian several times since we both arrived on the east coast, but this was a special trip. 


On a previous trip Brian gave Cindie, Karen and me a tour of a small zoo in Nashua for which he had veterinary responsibility.  He had treated a female elephant which had a small baby for some malady a few weeks previously and when we entered the building in which she and her youngster were housed, the female elephant saw Brian and  immediately began bellowing and moving behind several other full sized elephants.  She had remembered Brian.  It was a neat tour, as we saw a very young tiger kitten along with the adult tigers and a number of other major animals close up.


The weekend to meet Brad went quickly and we returned to Stamford, so Karen could continue her real estate work and I could get back to the GLC offices.  We traveled to Nashua for Thanksgiving and visited NYC afterwards to see the Christmas decorations.  We decided that we would  celebrate Christmas with Cindie, Brian and Brad.  Cindie returned to her ambulatory veterinary practice, carrying Bradley on her back as a papoose or letting him sleep  in the car cradle.  Brian’s work continued to go well; however, he didn’t agree with a number of the management practices of the animal hospital where he worked.  He kept his eyes open for an animal practice which he might buy, as he wanted to be his own boss and to practice veterinary medicine as he thought it should be practiced.


Early in 1985, I made my first trip to South America.  GLC had a joint venture petroleum coke calcining operation in Buenos Aires, Argentina.  I was appointed to the joint venture board.  John Sachs, Mike Wrotniak and I traveled to BA in February.  The plant was only three years old and was based on GLC’s calcining technology.  The Argentinian customers were aluminum companies several of which were associated with U.S. based aluminum producers and were customers of GLC in the U.S.  Some of the BA joint venture’s product was exported  to overseas aluminum plants.  The joint venture was performing satisfactorily and on target financially. The visit to BA was eye opening.  It is the first city where the population was so crowded that electrical power lines and telephone lines were strung across many streets from one building to another.  The city however was clean, modern and well laid out.  The habit of early afternoon naps and very late heavy dinners however, never for me.


The year 1985 was a very busy year for our family, approximately eight months after my joining GLC, a private company Horsehead Industries (HI), which was organized in 1981 by employees of Gulf and Western (G&W) to purchase selected portions of New Jersey Zinc’s operations from G & W purchased GLC.  New Jersey Zinc was a 1965 acquisition of G &W.   Horsehead Industries was formed by Bill Flaherty, its CEO along with David Carpenter, its President and COO, and some silent partners to make this purchase from G &W.  Horsehead Industries embarked on a prompt cost cutting program and liquidated assets to repay much of the borrowing incurred for the  purchase of New Jersey Zinc.   Horsehead Industries intended to do the same with GLC.


Horsehead Industries asked John Sacks and several other executives  to retire and organized GLC into two divisions.  Mike Wrotniak was named Sr. VP of GLC with responsibility for the Petroleum Coke Division and I was named Sr. VP of GLC with responsibility for the Graphite Division.  The administrative portion of GLC was reorganized and partially integrated into the HI administrative functions.  Horsehead Industries immediately began looking for a less expensive location for the GLC offices and found office space in Bryn Mawr, NY.   We promptly moved GLC offices out of the 410 Park Ave. building and HI was rewarded with a very nice bonus, as the owner of the building re-leased the space at a much higher rent.  Horsehead Industries also sold the corporate plane, recovered the company vehicles from the Skakel families, sold the entertainment venues used by GLC for customer entertainment,  sold surplus real estate and slashed excess inventory.  All of which enabled HI to significantly reduce the debt used to finance the GLC acquisition.


The remaining key employees of GLC scrambled to adopt the GLC operations into a mode acceptable to HI.  This involved a considerable amount of travel for me which also including meeting our major customers and suppliers.  The national economy was reasonably strong and the graphite business was good. Since recovering steel from scrap was less expensive than refining iron ore,  many steel producers were expanding their operations with electric arc furnaces and retiring or mothballing their traditional blast furnaces.  It was a hectic transition for those of us in GLC but a strong graphite electrode market helped in the transition.


During this transition, I travelled to Europe to review the acquisition of GLC  by HI with our graphite plant operations and our European graphite sales manager, who was based in London.  The weekend that I was in Europe, I planned to take a quick trip to Switzerland to do some European skiing, however the weather was unseasonably warm and the skiing was not good.  Instead, I took a quick trip to Berlin to visit the city and to see the Berlin Wall.  It was an eye-opening trip, as one afternoon I took a commercial tour of East Berlin, which was still under Soviet control.  The difference between East and West Berlin, was literally the difference between day and night.  West Berlin was bustling, streets full of pedestrians, shoppers and vehicles, store windows full of merchandise for sale, cranes idle for the weekend, but poised to continue building the many new buildings and so on.  East Berlin was a ghost town.  There were very few pedestrians, empty store windows, no sign of new construction, few vehicles in the streets and many, many buildings in disrepair or abandoned.  The hotel in which I stayed overlooked the Berlin Wall.  I could see the East German military patrolling the east side of the wall.  People on the west side of the wall were using heavy mauls and other manual equipment to knock holes in the wall while the East Berlin patrols stared at them but took no action.  I picked up several pieces of concrete which had been knock loose.  I still have one of those pieces.  It was two years later that President Reagan in an address to the Berliners that he said “Mr. Gorbachev, tear down this wall!”  Two years later, on November 9, 1989 the wall was officially down.


In July, Cindie and Brian exercised their option to purchase the house they were renting in Nashua, as the local housing market had appreciated substantially.  Later,  Brian found a small animal practice for sale in Chelmsford, MA a Boston suburb located about 25 miles south of Nashua.  Brian was impressed with the possibilities of purchasing this practice.  The practice, Countryside Animal Hospital  was for sale at a price of about $100,000 or one-time the claimed annual revenue.  They sold the Nashua house and walked away with a bit of cash. They negotiated a purchase contract for Countryside Animal Hospital, including a five year covenant for the seller to not  compete in a veterinary practice within a 25 mile radius of Countryside. The purchase closed December 23, 1985.  The practice had been owned by a veterinarian who employed a second veterinarian.  Brian was convinced that he could single handedly cover the veterinarian needs for Countryside’s business, at least initially.  Cindie and Brian rented a house in Westford,  MA which bordered Chelmsford.  Cindie transitioned her ambulatory veterinarian practice to another equine veterinarian near Nashua.  She stopped practicing veterinary medicine as they were planning to have a second child in the near future.  However, she continued to be active working with Brian in getting Countryside into the type of  animal practice that Brian wanted.


For my 50th birthday, Karen surprised me with a gold Rolex watch which she purchased with the commission from her first real estate transaction as a broker.  I had always thought that the Rolex watches were too ostentatious for me, but I had never told her that.  She had help on the purchase from David whose association with JB Robinson’s Jewelers enabled him to purchase the watch at cost.  I am wearing this watch as I write this autobiography now some 36 years later.  It has been cleaned  only once and had only one minor repair.  They are indeed good values with that life span.


Brian operated a very lean practice initially and took all of his client’s emergency needs including all hours of the day and weekends.  He quickly expanded the business and hired additional veterinarians and other necessary staff as justified.   He was very pleased with the transition from the previous owner.    Within six months Cindie and Brian found a house in Westford to purchase.  It was only a few hundred yards up the street from where they were renting and was an ideal house for a young family.  It had three stories, with four bedrooms and two bathrooms upstairs, a kitchen-dining area, a formal dining room, a living room, a den and a powder room on the main floor.  The full basement was eventually finished off with about one-half as service area and the other one-half as a rec room. It was located on a fairly large lot, with a big swimming pool immediately out the back door.


As year-end 1985 approached, Cindie and Brian were well on their way with a successful small animal hospital and now owned a nice home in Westford, MA.  Horsehead was making good progress with the integration of GLC into HI’s business.  Karen and I decided that we would return to Iowa for Christmas.  Cindie, Brad and Brian and Kim and Dave were all attending as well.  It was Brad’s first Iowa Christmas.  We enjoyed the usual Iowa family Christmas with too much food, especially ice cream and other deserts, good pheasant and rabbit hunting and a wonderful time in the folks relatively new house.  We learned later that Cindie was pregnant with Andrew who would arrive in July 1986.


In August 1986, Dave’s company, JB Robinson Jewelers was purchased by Kays Jewelers, a UK company.  As a result of this purchase, JB Robinson and Kays organizations were integrated and reorganized.  Dave was the only JB Robinson executive to receive a promotion as a result of this business combination.  He was promoted to Regional Manager, Southern Region of the U.S. of the combined companies and they were relocated to Atlanta, GA.  They sold their Houston, TX home and moved to Marietta, GA, an upscale Atlanta suburb north of Atlanta. Kim joined Saks Department Store where she served as the women’s casual clothes buyer.


Prior to buying GLC, HI had a small NYC office and one principal plant operation in Palmerton, PA, a small town mid-way between Bethlehem and Scranton.   While digesting GLC, HI continued its growth and acquisition program, forming a new business in early1986 which processed electric arc furnace dust, a hazardous waste to recover the valuable zinc, lead and cadmium contained this dust.  The lead and cadmium in the dust caused this material to be classified as hazardous waste.  The steel companies were required to dispose of this dust  at a considerable cost plus incurring a possible long-term environmental exposure if the landfill in which the dust was disposed ever became a hazardous waste problem.  The dust typically contained up to 20% zinc metal and smaller quantities of lead and cadmium.   Horsehead Industries recovered the zinc, lead and cadmium from the dust, rendering the remaining portion of the material, mainly calcium, iron and other inert metals a non-hazardous solids waste.  The recovered zinc, lead and cadmium was fumed – evaporated from the other metals utilizing a large rotary gas fired kiln. - The vaporized zinc, lead and cadmium were immediately oxidized into zinc oxide, lead oxide and cadmium oxide, which was sold to  recovery plants that refined these metal oxides into purified metal oxides or recovered the material as metal. 


This new business was named Horsehead Resources Development Company (HRD) and it utilized the zinc refining process employed by New Jersey Zinc previously to refine zinc oxide ores into zinc oxide.  The business was profitable as a result of charging the steel companies a processing fee for handling their hazardous waste and selling the recovered metal oxides to metal processing companies.  However, the metal prices sometimes varied widely as they are commodities and react to the worldwide supply and demand of each.  David Carpenter, also served as President of HRD, as he had been the primary supporter of this business opportunity.


Almost concurrently, Horsehead Industries was given the opportunity to negotiate exclusively for the purchase of seven specialty chemical and manufacturing businesses of ARCO, a large petroleum and copper metal company.  Because of my background in the chemical  industry, Horsehead Industries hired a friend of CEO Flaherty to be the President of GLC Graphite and transferred me to the acquisition and subsequent management team of the chemical businesses being purchased from ARCO.   


The six businesses were (1) Chemlink Petroleum, (2) Chemlink Water, (3) Sartomer, (4) Ceramic Products US and (5) two Alsco businesses.  


Chemlink Petroleum was a petroleum production chemicals company whose products were used to improve the production and transportation of crude oil. Its most important product was a patented high molecular weight organic polymer which when added to crude oil in microscopic amounts significantly reduced the viscosity of crude oil.  It found a large market for crude oil transported through the Alyeska Pipeline, between the Alaska North Slope and Alaska’s seaport on its southern coast.  The addition of small amounts of this product  increased the amount of crude oil that could be transported through the pipeline by 20% thereby eliminating the need for a very expensive major capital expansion of the pipeline.  This  business was headquartered in Plano, TX with a manufacturing facility in Oklahoma City, OK.


Chemlink Water was a supplier of chemicals and water treating services for industrial and commercial water systems, primarily for process and air conditioning cooling water systems.  Its major competitors were Nalco and Culligan.  It was headquartered in ARCO Chemical’s headquarter office building in downtown Philadelphia, PA.


Sartomer was a specialty chemical company which made smaller volume acrylic polymers used by many chemical companies formulating specialty products, e.g., adhesives, and other manufacturing companies,  e.g., golf ball manufacturing companies.  Its headquarters and only manufacturing plant was located in a Philadelphia, PA suburb.  Sartomer also had partnered with a major Japanese chemical company to build a small joint venture acrylic polymers plant on the Japanese company’s plant site.


Ceramic Products US was start-up ceramic powder manufacturing business to manufacture this material for a new but growing industry of making ceramic products from the new material.  The material was resistant to all chemicals and to significant wear action and therefore ideal for parts needing these characteristics.  This operation was located in Tucson, AZ where the president of that company started the business.


Alsco was a combination of two businesses both competing primarily in the residential construction products industry.  These businesses supplied vinyl products to the siding and the  roofing markets.   Flaherty hired a retired building products manufacturing executive to evaluate and  subsequently manage the two Alsco businesses.  Therefore, I was less involved with the due diligence and evaluation of these two businesses.


My responsibility was due diligence of the other four businesses.  I had the help of a financial analyst for the analyses of these business’ financial performance.  I spent the bulk of my time reviewing the manufacturing, and marketing functions of as many of these businesses as possible, to assess their strengths and weaknesses, including their management, to identify any possible hazardous waste issues and to bring these issues to the negotiating table. One part of the due diligence included a trip to Japan with Flaherty to meet with the executives of the Sartomer joint venture partner. It was a routine trip and it was an excellent time to get to know Bill Flaherty.  Bill Flaherty handled the negotiations at the senior level primarily with the CEO of ARCO, however the details were handled by our lawyers and me.  The acquisition of the ARCO chemical businesses completed rather quickly, as ARCO was willing to totally indemnify HI for any existing environmental exposure.   Upon closing this acquisition this new HI business was named Pony Industries.


I was assigned to be Sr. VP of Pony Industries with responsibility for overseeing Pony’s operations.  Almost immediately, Flaherty received an unsolicited expression of  interest for the ceramic business from a major Japanese ceramics manufacture which resulted in this business being quickly spun off to that company.  Flaherty also received unsolicited interest in the two building products businesses and these businesses were also spun off.


In May 1986, Karen and her sister-in-law, Lee Swanson, planned an 80th Birthday Party for her mother.  They included mom Swanson  in the planning and in determining who would be invited to attend.  Some fifty friends of hers, primarily from her and dad’s church and another dozen or so family toasted her wonderful life.  Her sister Joyce and Joyce’s husband, Matt, and her brother Reece and his wife Flo, all of whom lived in southern CA, and her baby brother, George who still lived in Buckeye, AZ all attended.  Cindie, Brian, Brad, and Kim  all attended as did Karen and I.  Cindie was seven months pregnant with we soon learned was son number two.  It was a wonderful celebration and mom Swanson thoroughly enjoyed it.


Andrew Karl Holub grandson number two is born -


Two months later, Kim, David, Karen and I were in Westford awaiting the birth of Andrew.  On Saturday afternoon, July 19th, Cindie announced it was time for her to go to the hospital.  Kim and David agreed to accompany Cindie and Brian to the hospital.  Karen and  I stayed at Cindie and Brian’s home and watched Brad.  Later that day Andrew was born, again without any complications.  Kim and David were able to witness first-hand Andrew’s birth and it almost convinced them to not have children.


In 1986 J B Robinson’s Jewelers was purchased by Kays Jewelers of the United Kingdom.  The new U.S. operations of Kays was organized into four regions.  Three of Kays regional managers were assigned to be regional managers within the new organization.  David was the only J B Robinson manager to be promoted to manage a region.  David and Kim moved to Marietta, GA, a suburb of Atlanta.


In December 1986, the president of Chemlink Petroleum was traveling to the Alaska North Slope to call on the crude oil production companies producing crude oil from that frozen tundra.  He invited me to travel with him on this customer visit and I gladly accepted.  It was an enlightening trip.  The production facilities were immense with as much of the machinery located within buildings as possible.  We stayed overnight, ate in the cafeteria for the workers and slept in a sleeping room shared by a number of visitors to the facility.  The temperature was moderate for the time of the year pretty much around zero Fahrenheit.  We observed the station where the Chemlink viscosity reducer was injected into the crude oil.  This product was shipped in 20,000 gallon rail cars from OK to the North Slope.  Chemlink Petroleum also sold the production companies other oilfield production chemicals which were supplied in 55 gallon drums and shipped in containers to the North Slope..


Mother Ruth Swanson dies -


Mom, Swanson was diagnosed with inoperable colon cancer in February 1987.  She rather quickly needed near continual bedrest.  She wanted to remain in her home so care was arranged for her and she remained home until she died on April 9, 1987.  She was 81 years old and had enjoyed a good life.  My sister Beverly, a registered nurse kindly spent several weeks caring for  Mom Swanson in her final weeks.  At the end Karen and I were there as well.  Sister-in-law, Lee was teaching school but spent as much time with Mom as she could when not teaching.   Mom was eulogized, as was Dad Swanson some nine years earlier in the church they helped build and was buried with Dad Swanson.


Karen and Lee had the unenviable task of selling mom Swanson’s home and otherwise liquidating her small estate.  The house sold quickly.  Karen and our girls, Lee and her girls wanted a few pieces of furniture and some other memorabilia but the remainder of mom’s belongings were given away or sold.  Lee carried most of this burden as she was located nearby.  Karen did what she could from some 2000 miles away.  Karen however did drive to Brea, CA by way of Houston, TX to pick up Kim  with plans to bring back to Kim’s and to our homes a few pieces of furniture that they wanted to keep as remembrances of our wonderful Swanson parents/grandparents.  They rented a small enclosed trailer in CA and trailed these important pieces to TX and then CT.

At the 1987 ISU Spring Commencement, ISU recognized a number of alumni for their achievements.  I was honored as one of the Engineering College achievers in the commencement bulletin.


Several petroleum and chemical companies reached out to HI expressing interest in the Sartomer Company which was highly profitable and well placed in a growing specialty plastics market.  One of those companies was Total, a large French petroleum and chemical company, which was also in the acrylic plastic monomers and polymers business.  Total had ambitious plans to expand in the chemical marketplace.   Bill Flaherty encouraged these companies to make an offer for Sartomer, which several did. Total made an aggressive offer and Bill tasked me with negotiating with the Total representative.  Total was quite familiar with the Sartomer business  as they were a major supplier of these products in Europe and elsewhere.  It needed no information on the marketplace or supply issues.  Their focus on negotiating the deal was the technology that Sartomer was employing and the Sartomer personnel.  A purchase agreement was soon hammered out and a deal finalized for the sale of Sartomer in mid - 1988. 


Kevin James Holub grandson number three is born -


Cindie and Brian added Kevin James Holub, grandson number three, to our growing family on March 26, 1988.  Cindie was now a pro at giving birth as she no longer stayed in the hospital a minute longer than absolutely necessary.  Cindie, Brian and family decided to not attend our resumed Davis Family summer reunion held in July 1988 when we returned to the Sportsman Resort at Lake of The  Ozarks.  Dick and Judy were also unable to attend as they were in Italy on a three year assignment.  Nancy and Neal plus Colin, who had just graduated from Kent, WA high school attended.  It was particularly good to see them.


Kyle James Holmberg grandson number four is born -


While all of this was proceeding, Kim and Dave were beginning their family with the birth of Kyle James Holmberg, born June 29, 1988.  Kim and Kyle were both doing well and were soon home.  Kim very much like Cindie was a natural mother.  Kyle was a good baby.  Karen and I traveled to Marietta to visit them shortly after she and Kyle were home.   A month later the Davis family summer reunion resumed after several years of no reunions because of other summer events, e.g., Denise and Keith’s wedding in August 1986 to which many of our family attended.


Earlier that spring, I was asked by President John Wagoner, William Penn University (WPU)  to join the board of the university, which I readily accepted.  I had not been supporting WPU financially nor been at all close to the university.  I was vaguely familiar with the university from conversations with my cousin Willard Ware a graduate of WPU, a long time board member and a financial donor.  I was also aware that both my Aunt Bea and Uncle Lisle and his wife Helen, all graduated from the university.  Finally, my third cousin John Wagoner had a long association with WPU and was now serving as President of WPU.  The board met quarterly in Oskaloosa, IA however, John advised me that if I could make at least one meeting a year that I would be welcomed to the board.  With my acceptance of this responsibility, I began some Ware family research on its relationship with WPU.  That somewhat extensive relationship is covered in some detail in Appendix One – The Ware Family. 


That fall, Karen and I made a $50,000 donation to WPU to establish The Davis Ware Endowed Scholarship at WPU.  The occasion was celebrated by my parents, my aunts Bea and Helen (who happened to be in Iowa visiting her nearby relatives) and Karen and I in a private reception at the university.


Ronald Reagan’s term as our 40th president was coming to a very successful conclusion.  His administration had a rocky start however, he accomplished a lot, including the  downfall of the Soviet Union, as the president was able to convince the leaders of the Soviet Union that they could not compete militarily and economically with the U.S.  The fall of the Berlin Wall was just the beginning.  Reagan’s vice-president, George Herbert Walker Bush was the Republican nominee to succeed Reagan.  Bush may have been the best prepared person to serve as the president of the U.S.  He was vice-president or eight years, CIA Director, U.S. Ambassador to the United Nations and four years as a U.S. Representative to the U.S. Congress from Texas.   The Democrats nominated the ex-governor of Massachusetts, Michael Dukakis.  George Bush won handily.


Bill Flaherty and the board of HI, began developing a  company incentive program for three of we HI/Pony officers who were not part of the HI ownership.  Bill Flaherty and David Carpenter, held a meeting with Harry Walters President of GLC Graphite, Bill Quirk, Executive Assistant to Flaherty and me outlining HI’s plans for an incentive compensation program, including both annual bonuses and some type of equity compensation.  The three of us were quite excited and interested in learning the particulars of this program.  A second meeting of this same group several months later with more teases about the progress being made in developing the program.  The program was never finalized or implemented.  In part possibly because GLC Graphite was sold to  a German graphite manufacture, Sigri and  Harry Walters, probably received a bonus as a result of that sale and a year later when Pony Industries was totally liquidated, I received a generous bonus.  I suspect Bill Quirk was well compensated with bonuses and possibly some equity, I don’t know.


Our beloved Mother, Ruth L. Ware Davis dies -


Mom’s health continued to trouble her and us as her cardiac issues  continued.   She had a long history of high blood pressure. In March she had fallen and crushed a vertebrae for which she was hospitalized. A serious bout of flu was superimposed on her recovery from the fall. In November she felt badly for several days. Her doctor prescribed an EKG which indicated she  had experienced a heart attack.  She was hospitalized in Marshalltown for two weeks and when she did not improve, her doctor referred her to the Methodist Medical Center (MMC) in Des Moines,   The doctor there did another EKG and scheduled her for an angiogram  on the following Monday. I kept in touch, principally with brother Bob, who kept in very close contact with mom and dad. 


On December 12 Mom reported to the MMC for an angiogram.  On that day she was stable but was fearful of what the test would find.  The test confirmed she had a heart blood vessel blockage and was she was scheduled for prompt surgery.  Bob alerted Dick and Janie, who drove to Des Moines together, arriving on Monday after mom’s angiogram.   Prior to the surgery, she had a heart attack and was placed in the ICU. Bob, Beverly, Dick and Janie were with dad and mom.  Bob called Nancy who made arrangements to fly to Des Moines. Bob called me on December 14th and advised me to come as mom was in serious condition.  Dad, Bob, Beverly and Dick were at the hospital when mom died. Janie was picking Nancy up at the airport at that time. Karen and I flew to Des Moines on December 15th, where Bob picked us up and told us that mom had died..  We all visited mom one last time and attempted to console dad and each other. It was a very sad time.  Mom died on brother Bob’s 52nd birthday!  When we left the hospital, dad asked Bob and me to go with him to tell, mom’s sister, Aunt Bea.  At that time Aunt Bea was living in her retirement home, alone having lost her lifetime partner,  Ethel.  Aunt Bea took it quite hard although she knew mom had a challenging heart issue.


Mom’s services were at 1:30 Saturday afternoon with Reverend John Wagner and Reverend Edward  Zelly (Hartland Church’s then paster) officiating.  She was buried in the Davis family Plot in the Heartland Cemetery, adjacent to the Ware family plot, where her parents and one brother and one sister rested.  Her other sister, Aunt Bea would be buried in this same family plot after her death of natural causes on April 3, 1990 at the age of 89.


We again gathered at dad’s for our unusual usual Davis Iowa family Christmas.  The loss of mom ten days earlier was a severely negative impact on the  Christmas celebration.  Even the normal very happy Hartland Church Christmas program was somber with the loss of her so recently. Aunt Bea was with us for our Christmas celebration, although she was clearly incurring failing health.  All of my siblings and family were able to make it for Christmas except Nancy who was residing in Seattle, WA a long way from Marshalltown.  She of course, was in Iowa for mom’s service.  The following summer we again gathered at the Sportsman Resort for the Davis family summer reunion.


The ARCO acquisition was now down to the two Chemlink businesses for which there was only mild interest, so Flaherty decided to do an Initial Public Offering (IPO) of these two units as a combined company.  The president of Chemlink Petroleum was appointed president of The Chemlink Group which included both Chemlinks.  We worked with the new organization to further improve its financial  performance and to strengthen its organization. The market for the sale of the crude oil flow enhancer was strong as the producing companies on the North Slope wanted to maximize the production of crude oil which required pushing as much crude oil through the Alyeska Pipeline as possible.   This improved the profitability of the Chemlink Group.  The IPO was scheduled for mid 1989.


Brett David Holmberg, grandson number five is born –


In August, Dave was approached by a privately owned regional jewelry chain, Reeds Jewelers, based in Wilmington, NC about becoming Vice President of Store Operations for Reeds.  He was offered attractive compensation and responsibility compared to his perceived future at Kays.  On July 29th, Kim gave birth to her and Dave’s second son, Karen and my fifth grandson (and to Karen’s mild disappointment our no granddaughters!).  Karen and I, visited Kim and her growing family shortly after she and Brett came home.  One year old Kyle and new born, Brett along with Dave’s business responsibilities, including frequent travel, challenged the family.  As a result of all this Kim, David and family were unable to attend our Davis Family summer reunion which was again held at the Sportsman Resort.    Kim decided not to rejoin the corporate merchandising world, but instead to follow her mother and open a needle works store in Wilmington.  Kim named her store Quilter’s Heaven.  She sold sewing machines and quilting supplies and taught quilting classes.  


The Chemlink Group IPO included a road show with  presentations to a number of security analysts and financial advisors.  I made the presentations of the of the Chemlink business. The IPO was reasonably successful, however, considering the total return that Pony was able to generate for HI from the acquisition of the ARCO Chemical business units, this acquisition was a home run for HI.  Bill Flaherty and the owners of HI did extremely well, but importantly for me, we key employees were well rewarded. My bonus was some $555,000 in cash and shares of Chemlink valued at $210,000! It was a very nice October 1989 surprise.  I shared this bonus with William Penn University in establishing the Davis Ware Family Endowed Scholarship, with an initial $50,000 contribution.


In December, Brian completed a significant renovation of Countryside Animal Hospital adding needed exam rooms and operating/treatment space.  His practice was very strong financially and was expanding rapidly.  Brian was active on the board of the American Feline Foundation , particularly lending his veterinary expertise to the review and approval of research grants made by the Foundation.  We again celebrated our usual Davis family Christmas.  The loss of mom just over a year ago continued to depress our Christmas joy.  Dad insured that Aunt Bea was with us, despite her frail health.


I had attended four of the WPU’s board meetings since joining the board and was assigned to the recruiting committee and met with the recruiting staff members to discuss recruiting strategy and enrollment issues.  It was an interesting assignment, however, despite reasonable recruiting success, WPU was suffering from a significant financial squeeze and the financial emphasis deserved and received primary attention. 


Early in 1990,  I was promoted to President of HRD, with a salary of $200,000 and a mission of taking HRD public via an IPO. 


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