“No, Harry’s already pledged his one percent to Tom Russell, and is telling everyone else to do the same thing, though he was shocked when I told him how much his shares were worth.”
Fletcher laughed. “I see the financial journalists are speculating that both sides now have around forty percent, with only another week to go before the offer closes.”
“Yes, it’s going to be close. I only hope Tom Russell realizes just how dirty it will become now that Ralph Elliot is involved,” said Fletcher.
“I couldn’t have made it clearer,” said Jimmy quietly.
“When was this sent out?” Nat asked as the rest of the board studied the latest missive circulated to all shareholders by Fairchild’s.
“It’s dated yesterday,” said Logan, “which means we have three days left to respond, but by then I fear the damage will have been done.”
“Even I wouldn’t have believed Elliot was capable of sinking this low,” said Tom as he studied the letter signed by Murray Goldblatz:
Things you didn’t know about Nathaniel Cartwright,
the Chief Executive of Russell’s Bank
—Mr. Cartwright was neither born nor raised in Hartford;
—he was rejected by Yale after cheating in the entrance exam;
—he left the University of Connecticut without a degree, after losing the election for student president;
—he was sacked from J P Morgan after losing the bank $500,000;
—he’s married to a Korean girl whose family fought against the Americans during the war;
—the only job he could find after being sacked by Morgan’s was with an old school friend, who just happened to be chairman of Russell’s Bank.
Pledge your shares to Fairchild’s: be sure your future is secure.
“This is the response that I propose we send out by express mail today,” said Logan, “allowing Fairchild’s no time to respond to it.” He slid a copy across to each board member.
Things you ought to know about Nat Cartwright,
the Chief Executive of Russell’s Bank
—Nat was born and raised in Connecticut;
—he won the Medal of Honor in Vietnam;
—he completed his undergraduate degree at Harvard (summa cum laude), before going on to Harvard business school;
—he resigned from Morgan’s, having made a profit for the bank of over a million dollars;
—during his nine years at Russell’s as Chief Executive, he has quadrupled the bank’s profits;
—his wife is Professor of Statistics at UConn, and her father was a master sergeant in the American Marines.
Stay with Russell’s: the bank that cares about you and takes care of your money.
“Can I release it immediately?” asked Logan.
“No,” said Nat, tearing it up. He didn’t speak for some time. “It takes a lot to get me angry, but I am about to kill off Ralph Elliot once and forever, so listen carefully.”
Twenty minutes later, Tom ventured the first comment, “That would be taking one hell of a risk.”
“Why?” asked Nat, “if the strategy fails, we’ll all end up multimillionaires, but if it succeeds, we’ll take control of the biggest bank in the state.”
“Dad’s livid with you,” said Jimmy.
“But why?” asked Fletcher, “when I won.”
“That’s the problem, you won by over twelve thousand votes, which was tactless of you,” said Jimmy as he watched Harry Junior running down the wing, the ball at his feet. “Don’t forget that he only managed eleven thousand once in twenty-eight years, and that was when Barry Goldwater was running for president.”
“Thanks for the warning,” said Fletcher. “I guess I’d better avoid the next couple of Sunday lunches.”
“You’d better not, it’s your turn to be told how he made a million overnight.”
“Yes, Annie warned me that he’d sold his shares in Russell’s Bank. I thought he’d made a pledge not to release them to Fairchild’s at any cost?”
“He did, and he would have kept to it, but the day before the offer was due to close, and the shares had peaked at $7.10, he had a call from Tom Russell, advising him to sell. He even suggested that he get in touch with Ralph Elliot direct so the deal would go through quickly.”
“They’re up to something,” said Fletcher. “There’s no way Tom Russell would have told your father to deal with Ralph Elliot unless there’s another chapter still to be written in this particular saga.” Jimmy said nothing. “So can we therefore assume that Fairchild’s has secured over fifty percent?”
“I asked Logan the same question, but he explained that because of client confidentiality, he couldn’t say anything until Monday, when the official figures would be released by the SEC.”
“Ouch,” said Jimmy, “did you see what that Taft kid just did to Harry Junior? He’s lucky Joanna’s not here, otherwise she would have run onto the field and whacked him.”
“Those in favor?” asked the chairman.
Every hand around the table rose, though Julia seemed to hesitate for a moment. “Then it’s unanimous,” declared Tom and, turning to Nat, added, “perhaps you should take us through what’s likely to happen next.”
“Certainly, chairman,” said Nat. “At ten o’clock this morning, the SEC will announce that Fairchild’s has failed to secure control of Russell’s Bank.”
“What percentage do we think they’ll end up with?” asked Julia.
“They had 47.89 percent at midnight on Saturday, and may have picked up a few more shares on Sunday, but I doubt it.”
“And the price?”
“At close of business on Friday they were $7.32,” said Logan, “but after this morning’s announcement, all pledges are automatically released and Fairchild’s cannot make another bid for at least twenty-eight days.”
“That’s when I plan to put a million of Russell’s shares on the market,” said Nat.
“Why would you do that?” asked Julia, “when our shares would be certain to fall sharply.”
“So will Fairchild’s because they own nearly fifty percent of us,” said Nat, “and they can do nothing about it for twenty-eight days.”
“Nothing?” repeated Julia.
“Nothing,” confirmed Logan.
“And if we then use the extra cash to buy Fairchild’s shares as they begin dropping…”
“You would have to inform the SEC the moment you reached six percent,” said Logan, “and at the same time let them know that it’s your intention to make a full takeover bid for Fairchild’s.”
“Good,” said Nat, as he pulled the phone toward him and dialed ten digits. No one spoke as the chief executive waited for the phone to be answered. “Hi, Joe, it’s Nat, we’re going ahead as planned. At one minute past ten, I want you to place a million of the bank’s shares on the market.”
“You realize they’ll drop like a stone,” said Joe, “because you’re about to turn everyone into a seller.”
“Let’s hope you’re right, Joe, because that’s when I want you to start mopping up Fairchild’s shares, but not until you think they’ve bottomed out. And don’t stop until you’ve got hold of five point nine percent.”
“Understood,” said Joe.
“And, Joe, just be sure you keep an open line night and day, because you’re not going to get much sleep during the next four weeks,” added Nat before replacing the receiver.
“Are you sure we’re not breaking the law?” asked Julia.
“Certain,” said Logan, “but if we pull it off, my bet is that Congress will have to rewrite the legislation on takeovers in the very near future.”
“And do you consider what we’re doing is ethical?” asked Julia.
“No,” said Nat, “and it wouldn’t have even crossed my mind to behave this way if we hadn’t been dealing with Ralph Elliot.” He paused. “I did warn you that I was going to kill him. I just didn’t tell you how.”
39
“You’ve got
the chairman of Fairchild’s on line one, Joe Stein on line two, and your wife on line three.”
“I’ll take the chairman of Fairchild’s. Ask Joe Stein to hold and tell Su Ling I’ll call back.”
“Your wife said it was urgent.”
“I’ll call her back in a few minutes.”
“I’m putting Mr. Goldblatz through.”
Nat would have liked a few moments to compose himself before he spoke to the chairman of Fairchild’s; perhaps he should have told his secretary that he would call him back. For a start, how should he address him: Mr. Goldblatz, Mr. Chairman or sir? After all, he had been chairman of Fairchild’s when Nat was still at Harvard Business School doing case studies on banking.
“Good morning, Mr. Cartwright.”
“Good morning, Mr. Goldblatz, how can I help you?”
“I wondered if perhaps we could meet.” Nat hesitated because he wasn’t quite sure what to say. “And I think it would be wise if it were just the two us,” he added. “Jus…jus…just the two of us.”
“Yes, I’m sure that would be all right,” said Nat, “but it will have to be somewhere no one would recognize us.”
“Might I suggest St. Joseph’s Cathedral?” said Mr. Goldblatz, “I don’t think anyone will recognize me there.”
Nat laughed. “When did you have in mind?” he asked.
“I would have thought sooner rather than later.”
“I agree,” said Nat.
“Shall we say three o’clock this afternoon? I can’t imagine there will be that many people in church on a Monday afternoon.”
“St. Joseph’s, three o’clock, I’ll see you there, Mr. Goldblatz.” No sooner had Nat put the phone down than it rang again.
“Joe Stein,” said Linda.
“Joe, what’s the latest?”
“I’ve just picked up another hundred thousand of Fairchild’s stock, which takes you up to twenty-nine percent. They’re currently around $2.90, which is less than half their high point. But you do have a problem,” said Joe.
“And what’s that?”
“If you don’t get hold of fifty percent by next Friday, you’ll be facing exactly the same problem Fairchild’s had a fortnight ago, so I hope you know what your next move is.”
“It may become clearer after a meeting I’m having at three o’clock this afternoon,” said Nat.
“That sounds interesting,” said Joe.
“It could well be,” said Nat, “but I can’t say anything at the moment because even I’m not sure what it’s all about.”
“Curiouser and curiouser,” said Joe. “I’ll look forward to hearing more. But what do you expect me to do in the meantime?”
“I want you to go on buying every Fairchild’s share you can lay your hands on until close of business tonight. Then let’s talk again just before the market opens tomorrow morning.”
“Understood,” said Joe, “then I’d better leave you and get back on the floor.”
Nat let out a long sigh, and tried to think what Murray Goldblatz could possibly want to see him about. He picked up the phone again, “Linda, get me Logan Fitzgerald—he’ll be on his New York number.”
“Your wife did stress that it was urgent and she called back again while you were speaking to Mr. Stein.”
“Right, I’ll phone her while you try and find Logan.”
Nat dialed his home number and then began strumming his fingers on the desk as he continued to think about Murray Goldblatz and what he could possibly want. Su Ling’s voice interrupted his thoughts.
“Sorry I didn’t—call you straight back,” said Nat, “but Murray…”
“Luke’s run away from school,” said Su Ling. “No one’s seen him since lights out last night.”
“You’ve got the chairman of the Democratic National Committee on line one, Mr. Gates on line two, and your wife on line three.”
“I’ll take the party chairman first. Would you ask Jimmy to hold and tell Annie I’ll call her right back.”
“She said it was urgent.”
“Tell her I’ll only be a couple of minutes.”
Fletcher would have liked a little more time to compose himself. He’d only met the party chairman a couple of times, in a corridor at the national convention, and at a cocktail party in Washington, D.C. He doubted if Mr. Brubaker would remember either occasion. And then there was the problem of how to address him, Mr. Brubaker, Alan, or even sir. After all, he’d been appointed chairman before Fletcher had even run for the Senate.
“Good morning, Fletcher, Al Brubaker.”
“Good morning, Mr. Chairman, how nice to hear from you. How can I help?”
“I need to have a word with you in private, Fletcher, and wondered if you and your wife could possibly fly down to Washington and join Jenny and me for dinner one evening.”
“We’d be delighted to,” said Fletcher, “when did you have in mind?”
“How’s the evening of the eighteenth looking? That’s next Friday.”
Fletcher quickly flicked through the pages of his appointment book. He had a caucus meeting at noon, which he shouldn’t miss now that he was deputy leader, but nothing was penciled in for that evening. “What time would you like us to be there?”
“Eight suit you?” asked Brubaker.
“Yes, that will be fine, Mr. Chairman.”
“Good, then eight o’clock it is, on the eighteenth. My home is in Georgetown, 3038 N Street.”
Fletcher wrote it down in the space below the caucus meeting. “I look forward to seeing you then, Mr. Chairman.”
“Me too,” said Brubaker. “And Fletcher, I would prefer if you didn’t mention this to anyone.”
Fletcher put the phone down. It would be tight, and he might even have to leave the caucus meeting early. The intercom buzzed again.
“Mr. Gates,” said Sally.
“Hi, Jimmy, what can I do for you?” asked Fletcher cheerily, wanting to tell him about his invitation to have dinner with the chairman of the party.
“It’s not good, I’m afraid,” said Jimmy. “Dad’s had another heart attack and they’ve rushed him into St. Patrick’s. I’m just about to leave, but I thought I’d give you a call first.”
“How bad is he?” asked Fletcher quietly.
“Hard to tell until we hear what the doctor has to say. Mom wasn’t exactly coherent when she got in touch with me, so I won’t know a lot more until I’ve been to the hospital.”
“Annie and I will be with you as soon as we can,” said Fletcher. He touched the bridge of his telephone and then dialed his home number. It was busy. He replaced the phone and began tapping his fingers. If it was still busy when he tried again he decided he would drive straight home and pick Annie up so they could go over to the hospital together. For a moment, Al Brubaker flashed back into his mind. Why would he want a private meeting that he would prefer not to be mentioned to anyone else? But then his thoughts returned to Harry and he dialed his home number a second time. He heard Annie’s voice on the end of the line.
“Have you heard?” she asked.
“Yes,” said Fletcher, “I’ve just spoken to Jimmy. I thought I’d go directly to the hospital so we could meet there.”
“No, it’s not just Dad,” said Annie. “It’s Lucy, she had a terrible fall when she was out riding this morning. She’s concussed and has broken her leg. They’ve put her in the infirmary. I don’t know what to do next.”
“I blame myself,” said Nat. “Because of the takeover battle with Fairchild’s I haven’t been to see Luke once this term.”
“Me neither,” admitted Su Ling. “But we were going to the school play next week.”
“I know,” said Nat. “As he’s playing Romeo, do you think the problem might be Juliet?”
“Possibly. After all, you met your first love at the school play, didn’t you?” asked Su Ling.
“Yes, and that ended in tears.”
“Don’t blame yourself, Nat. I’ve been just as preoccupied wi
th my graduate students these last few weeks, and perhaps I should have questioned Luke more closely about why he was so silent and withdrawn during term break.”
“He’s always been a bit of a loner,” said Nat, “and studious children rarely gather a lot of friends around them.”
“How would you know?” asked Su Ling, glad to see her husband smile. “And both our mothers have always been quiet and thoughtful,” Su Ling added as she drove onto the highway.
“How long do you think it will take us to get there?” asked Nat as he glanced at the clock on the dashboard.
“At this time of day, about an hour, so I expect we should arrive around three o’clock,” said Su Ling, as she took her foot off the accelerator, once she’d touched fifty-five.
“Three, oh hell,” said Nat, suddenly remembering, “I’ll have to let Murray Goldblatz know that I won’t be able to make his meeting.”
“The chairman of Fairchild’s?”
“No less, he requested a private meeting,” said Nat as he picked up the car phone. He quickly checked Fairchild’s number in his phone book.
“To discuss what?” asked Su Ling.
“It has to be something to do with the takeover, but beyond that I haven’t a clue.” Nat pressed the eleven digits. “Mr. Goldblatz, please.”
“Who shall I say is calling?” asked the switchboard operator.
Nat hesitated, “It’s a personal call.”
“I will still need to know who it is,” the voice insisted.
“I have an appointment with him at three o’clock.”
“I’ll put you though to his secretary.” Nat waited.
“Mr. Goldblatz’s office,” said a female voice.
“I have a three o’clock appointment with Mr. Goldblatz, but I fear I am going…”
“I’ll put you through, Mr. Cartwright.”