COVER

The Private Life Of CANADA’S RICHEST MAN

PUBLISHING BARON KEN THOMSON SAYS THAT HE WOULD ‘WALK A BLOCK TO SAVE A DIME’

P. C. N.,P. C. N. October 14 1991
COVER

The Private Life Of CANADA’S RICHEST MAN

PUBLISHING BARON KEN THOMSON SAYS THAT HE WOULD ‘WALK A BLOCK TO SAVE A DIME’

P. C. N.,P. C. N. October 14 1991

The Private Life Of CANADA’S RICHEST MAN

PUBLISHING BARON KEN THOMSON SAYS THAT HE WOULD ‘WALK A BLOCK TO SAVE A DIME’

COVER

The third and final volume of Peter C. Newman ’s history of the Hudson ’s Bay Co. is scheduled for publication on Oct. 12. Merchant Princes includes the first major portrait of the Bay’s reclusive owner, multibillionaire Ken Thomson, Canada’s richest man and the eighth-richest individual in the world. Excerpts-.

He shambles through life, his limb movements a study in awkwardness, doing none of the things one would expect a man of his means and opportunities to venture and enjoy. Deferential to the point of absurdity—and stingy to a point far beyond that—Ken Thomson has turned self-effacement into an art form.

His astonishing communications empire swirls about him, throwing off $4.4 million a week into his personal dividend account, employing 105,000 people on four continents and threatening to become the world’s largest media oligarchy. It already ranks fourth, after Germany’s Bertelsmann,

Capital Cities/ABC and Time Warner Inc. The Thomson organization publishes 175 newspapers (with a daily circulation of 4.5 million)— more than any other firm—and sells an incredible 40,000 other editorial products, including 145 magazines,

188 weeklies and assorted books, directories, newsletters and software packages.

There’s no corporate kingdom quite like it anywhere. Besides the Hudson’s Bay Co. (HBC)

and his publishing holdings, Thomson owns a real estate arm (Markborough Properties Inc., with assets of $2.3 billion) and an overseas travel subsidiary that accounts for 40 per cent of Britain’s package-tour business and owns 500 Lunn Poly Ltd. “holiday shops.” He also is sole proprietor of Britannia Airways Ltd., the United Kingdom’s second-largest airline, which last year carried six million passengers aboard 40 jumbojets (16 more are on order). Because the Thomson companies’ debt ratios are unusually low and their credit lines are virtually unlimited, Ken is in the enviable position of being able to buy any $5-billion competitor that comes along. That would make him the world’s media king.

By mid-1991, Thomson’s personal equity holdings were worth $7.7 billion, which according to the July 22, 1991, issue of Forbes magazine, which annually ranks the wealthy, made him the world’s eighth-richest individual. The listing placed Thomson well ahead of Gerald Grosvenor, sixth Duke of Westminster, who is England’s richest man, and such celebrated moneybags as Italy’s Giovanni Agnelli, Hong Kong’s Li Ka-shing, the Gettys, the Rothschilds and the Bronfmans. He is also the richest Canadian— a reckoning that excludes Toronto’s Reichmann brothers because their holdings are divided among three families.

Unlike these and other worldly figures who qualify as rich and famous—and behave as if they were— Thomson acts and looks like a small-town bank

‘GONZO IS THE SWEETEST DOG. HE’S EVERYBODY’S PAL, ESPECIALLY MINE.’

teller. He spends virtually no money on himself and divulges no public clues to his private thoughts or personal motivations. Compulsively shy of personal publicity and seldom interviewed except about his art (and for this story), he would much prefer to be invisible, and he in fact almost is. “The lowest profile,” he contends, “is the very best to have.” Although he seems scarcely aware of it, Thomson is caught in a time warp between the high-tech world of his communications conglomerate and the unbending Baptist ethic of rural Ontario, where he simmered up. “We were raised on the principle that you kept yourself to yourself and that only the members of your close family were your true friends,” recalled his niece Sherry Brydson, who grew up with Ken. “You played it close to your chest and believed that only with family could you let your hair down. Ken has taken it a step further. He’s got to the point where he doesn’t let his hair down with anybody.”

Even in his dealings with longtime business colleagues,

Thomson still demonstrates that air of impenetrable reserve. It is entirely in character that his office, on the top floor of the Thomson Building at the comer of Queen and Bay streets in downtown Toronto, has a vertical moat. Public elevators run to the 24th floor, but only pre-screened and thoroughly vouched-for visitors are allowed into the private lift that ascends up to the 25th level, shared by Thomson and John Tory, his chief corporate strategist (page 47). Thomson’s office houses part of his art collection, including most of the 204 canvases by the DutchCanadian artist Cornelius Krieghoff that he owns (page 48). They hang there, looking as comfortable as nuns in a discotheque.

Gathering Krieghoffs is Ken Thomson’s most visible dedication, but his real cultural hero is an artist in a very different discipline: Clarence Eugene (Hank) Snow, the Nova Scotia-born country singer. Thomson regularly visits Hank at the Grand Ole Opry in Nashville, Tenn., owns copies of all of his records, has been to Snow’s house in Tennessee and once presented him with a gold Hamilton pocket watch that had been a family heirloom.

Ken Thomson’s psyche is so difficult to penetrate because he behaves like an accomplished actor, able to detach himself from whatever crisis might be occupying his mind. Occasionally, very occasionally, a show of passion will flicker across his shuttered face, only to be quickly withdrawn, like a turtle’s head back into its protective shell. Exceptions to such reticence come unexpectedly:

A few seasons ago, Posy Chisholm, a sophisticated and vivacious Toronto socialite who looks smashing in hats, has a profoundly developed sense of the absurd and possesses a remarkable memory, found herself at Heathrow, about to board British Airways Flight 93 to Toronto. When she spotted Ken, the two acquaintances decided to travel together, although Chisholm had to trade down a class, wondering why Thomson was too cheap to travel in style and comfort.

“You know why I’m flying home?” Thomson asked, when they were settled in their narrow seats.

“No, I don’t,” Posy replied.

“To give Gonzo his evening meal,” the press lord matter-of-factly explained. “I’ve been away from my dog for five days now, and I miss him so terribly. We were half an hour late leaving London, and I’m really nervous they might give him dinner without me.”

“Oh, Ken,” Chisholm tried to reassure her agitated companion, “they’ll make up time across the ocean.” “Gonzo is crazy in many ways, but very, very lovable,” Thomson went on as Posy, crammed into steerage beside the fretting billionaire, began looking longingly down at the heaving Atlantic. “Gonzo is the sweetest dog. He’s everybody’s pal, especially mine. He’s a Wheaton terrier, the color of wheat, off-white. Actually, he’s got a little apricot.”

“How about some champagne, Ken? No? Oh well....”

“Gonzo leads a good life. I plan my trips abroad around him. I never go to annual meetings unless I’ve got him covered. I couldn’t put him in a kennel; he’s a member of the family. He seems to have an understanding of what’s happening all the time. We communicate. We know what the other is thinking. We love each other.”

“I suppose you take him walking____”

“Oh, I take him out all the time. Early in the morning, late at night and every time I can in between. If I can’t get home for lunch, my man goes up and walks him. He might be there right this minute. Gonzo’s got to have his exercise.”

§ “Doesn’t he have a garden?” asked § Posy, grasping for relevance.

^ “He doesn’t want to stay out all day. s Gonzo’s a people dog. He likes walking % in the park and then he wants to come I back inside.”

* It was going to be a long flight. Chisholm remembered a friend’s joking that if she were ever reincarnated, she wanted to come back as Ken Thomson’s dog. So Posy told him, hoping the idea might amuse the single-minded tycoon.

“Well, she’d be well looked after,” was the serious reply. “I tell you, Gonzo’s a big part of my life. I know that sounds awfully funny. But it’s a fact. I think of him all the time. I look after him like a baby.”

“What about your wife—does Marilyn love Gonzo too?”

“One time, I was looking at Gonzo, and I said to Marilyn, ‘Geez, he wants something.’ ”

“She said, ‘We all want something.’ ”

“ ‘Yes, but he can’t go to the refrigerator and open the door. Gonzo can’t tell you he’s got a pain in his tummy. We’ve got to look after him, anticipate everything he wants. It might be a bit of food he needs, maybe

At this point Thomson leaned forward to emphasize the significance of what he was about to reveal. “I tried to figure what Gonzo was really after,” he confided. “It’s a game we play.”

“So, what did Gonzo end up wanting?” Posy Chisholm halfheartedly inquired—purposefully fumbling under her seat, hoping that was where they kept the parachute.

“A bikkie!” exclaimed the world's eighth-richest man. “That’s what Gonzo wanted—a bikkie!”

There followed a lengthy silence. Thomson seemed satisfied there was little point trying to top that remarkable bit of canine mind reading.

About half an hour out of Toronto, he started to get restless because the 747 had been unable to make up the original delay and was not going to arrive at 5:35, as scheduled. He put on his coat and complained so

bitterly he might miss getting home in time for his dog’s feeding that Chisholm suggested she take his luggage through customs and drop it off at his house—while he dashed through the terminal, bound for Gonzo.

Ken Thomson sightings are like that. If he knows and trusts the person he’s with, he will talk about his dog or his art collection, but that’s it. Unlike nearly every other rich and powerful individual of even a tenth his wealth and influence, he leaves few contrails. “The smartest thing those who have more than anybody else can do is not to flaunt it,” he says. “It’s resented and it’s in terribly bad taste. It shows a poor sense of priority.”

The best evidence of Ken Thomson’s success in perpetuating his anonymity is that most Canadians, even fairly sophisticated businessmen, still regard him as the youthful and untried inheritor of the publishing empire built up by his father, Roy Thomson. They dismiss the current press lord as “Young Ken,” an immature figurehead whose main accomplishment was to be his father’s only son.

“Young Ken” is in fact 68 years old. “I’m not young anymore, but I don’t really mind being called ‘Young Ken,’ ” says he. “My dad was such an unusual individual that nobody can expect to be anywhere near a carbon copy of him. He was one of a kind. He channelled his g ambition in a single direction and everything 5 emanated from that. Now, it’s a different world § we live in.”

I Ken has force-fed his father’s business emz pire from annual revenues of $725 million in I 1976, when he took over, to $11.5 billion a “ decade and a half later. The total equity value of the companies he controls has skyrocketed from less than $1 billion to more than $11 billion, exponentially surpassing Roy Thomson’s impressive rate of annual growth.

In 1989, following sale of the Thomson Group’s North Sea oil holdings foF|670 million, its publishing assets were combined into an umbrella organization (the Thomson Corp.). At the time, in an uncharacteristic display of emotion, Thomson boasted that it would allow him to set his sights on any target. “I can’t imagine any publishing company anywhere

THE POWER BEHIND THE KING

John Tory’s real function in the Thomson hierarchy is a source of constant conjecture within and without the organization. “I’m a professional and I never worry about my image,” Tory says. “As a businessperson, you can have too high a profile, but there’s no up side to that whatsoever. When we bought the Hudson’s Bay Co., there was a big fuss, but we didn’t say much; when it was down for the count, we said even less; and when it recovered, we said nothing.” Tory refuses to play the Bay Street game. “I don’t need the kind of glory others seek,” he says.

It is too easy to speculate that John Tory is the brains behind Ken Thomson, because that wouldn’t be fair to either of them. Thomson is not that smart, and Tory is not

that self-effacing. As president of most of the family holding companies, Tory exercises enormous influence. He acts as a kind of secretary general of the $9-billion corporate confederacy, prodding, solving, appointing, acquiring, divesting, troubleshooting—running the damn thing—but never quite making the ultimate decision by himself. He is not exactly a surrogate, because when he speaks no one knows whether it’s really with his voice or Ken’s. Veterans of the Thomson organization know that it’s usually both, and leave it at that.

Tory reads at least two books a year that have nothing to do with business, loves to parse balance sheets, is happy to work 16-hour days, plays some golf and tennis, and skis, but when a friend asked him to go sailing, he discovered he didn't own a short-sleeved shirt. The centre of his life is his family—four super-bright children and 12 grandchildren. He plays a mean After You’ve Gone on a barrelhouse piano and dabbles in bridge. The hobby he takes most seriously is keeping up with his wife, Liz, Toronto's

shrewdest and busiest social animator.

As well as his Thomson responsibilities, Tory is a director of Sun Life Assurance Co. of Canada, Rogers Communications Inc., Abitibi-Price Inc. and, for the past 20 years, the Royal Bank of Canada. “If you asked almost anyone on the Royal board who was the most brilliant guy there,” said former deputy chairman John Coleman, “they’d say John Tory. He asks the most pertinent questions and can see through a deal most quickly.”

Thomson himself doesn't just admire Tory, he worships the man. “If you take the best qualities of the best people in all the different fields of business and roll them into one—that’s John Tory,” he says. “It’s the same pleasure for him to work the way I collect paintings and walk my dog. Above all, he’s got a great wife, family and good friends. They have fun together.”

in the world that would be beyond our ability to acquire,” he gloated.

Ken Thomson leads a double life and enjoys neither. In England—and most of non-North America where titles still mean something—he is Baron Thomson of Fleet of Northbridge in the City of Edinburgh, the hereditary peerage bestowed on his father, who made a fortune in British newspapers. During their visits to England, Lord and Lady Thomson live in a four-bedroom flat (purchased for $270,000 in 1967) in Kensington Palace Gardens, off Bayswater Road. A secluded street with extra police protection, that is where many of the ambassadors to the Court of St. James’s have their residences. While abroad, the introverted Ken and Marilyn Thomson of Toronto are transformed into the introverted Lord and Lady Thomson of Fleet, with two sets of clothing and accessories as well as stationery and visiting cards. “I lead a dual life and I’m getting away with it!”

Thomson delights. “It actually works.”

“For Dad, the title symbolized what he had achieved from nothing, and he made me promise I wouldn’t give it up,” Ken recalled. “He told me he’d like to see me carry it on because he rightly suspected I was the type of person who might not want to. I remember telling him, ‘Well,

Dad, I think you’re a little naughty to ask me to do that.

Because everybody should have the right to make his own decisions in this world.

But after what you’ve done for me, if you really want me to, I’ll make you that promise.’ Now, I didn’t promise him I’d use the title in Canada or that I’d take up my seat in the House of Lords. So now I’m happy to have it both ways.”

Another of the inheritances from his father was Ken’s attitude that while making money was holy, spending it was evil (page 52). The Thomson style of penny-pinching goes well beyond sensible parsimony (page 50). Although he is a member of six of Toronto’s most exclusive clubs—the York, Toronto, National, York Downs, Granite and Toronto Hunt—he prefers to have lunch by himself at a downtown yogurt bar. Murray Turner, a former HBC executive who knows Thomson slightly,

was shopping in the Loblaws store at Moore and Bayview when he heard a shout, “Murray! Murray!” and saw Thomson beckoning to him. As he reached the side of the world’s eighth-richest man, it was obvious that Thomson could hardly contain himself. “Lookit,” he exclaimed, “lookit this. They have hamburger buns on special today. Only $1.89! You must get some.” Turner looked in disbelief at Thomson’s shopping cart and, sure enough, there were six packages of buns, presumably for freezing against a rainy day.

“I’d walk a block to save a dime at a discount store,” Thomson readily admits. On the same day that he spent $641 million on a corporate takeover, Thomson met George Cohon, the Canadian head of McDonald’s, and asked him for a toy Ronald McDonald wristwatch. Cohon sent him one of the free timepieces (used mainly for internal promotions), but

the very next day Thomson’s secretary was on the phone claiming that the watch had gained four minutes over the past 24 hours and asking where His Lordship could get it fixed. Instead, Cohon ordered another watch sent to him—but the messenger had strict orders to bring back the original gift.

The press lord appears to dress well (his shoes are from Wildsmith’s on London’s swank Jermyn Street), but his suits are made for him by a cut-rate tailor in Toronto’s Chinatown at $200 apiece from the discounted ends of bolts he picks up during his journeys to Britain. He lives in a 23-room mansion, built in 1926 by Salada Tea Co. president Gerald Larkin, behind a set of handsome gates at the top of Rosedale’s Castle Frank Road. A prime example of Ontario Georgianstyle architecture, the dwelling is run-down, its curtains left over from its first owner. The Thomsons (Marilyn’s parents live with them in a coach house) usually eat in the kitchen to save electricity, and the family is unable to retain housekeepers because of the low pay. Even the help’s food is rationed. Most cookies in the refrigerator are kept in a box with the Thomson name lettered on it. A strict allocation of two of Mr.

A COLLECTOR WITH A PASSION

The one situation where Ken Thomson finds peace is in the private world of his art objects. Within these hushed precincts, he can build his own esthetic universe, indulging his whims without the budgetary problems that inhibit most collectors. He richly deserves his reputation as the premier collector of habitant scenes by Cornelius Krieghoff (some bought for as high as $275,000), all of them magically revived by one of England’s best restorers. “He knows every picture the artist painted or attempted to paint and is constantly upgrading his collection,” according to the Earl of Westmorland, the British director of Sotheby Parke Burnet and Co. “He’s got a great eye and a passionate love of art,” echoed Chris-

tina Orobetz, the Canadian president of Sotheby’s.

The best of Thomson’s Canadiana collection (conservatively estimated as being worth $20 million) is now displayed in a 5,000-square-foot gallery on the top floor of Toronto’s main Bay store. “I’ve reached a plateau,” he says. “I’ve got my collection basically together and have reached the point where I can be very selective with gathering my objets d’art.”

They include the only wood carving Michelangelo ever did, stunning boxwood and ivory carvings and some incredible miniatures by Octavio Jenilla. Death is a recurring theme of his collection, which includes any number of realistically rendered skulls—the carving of a sleeping child using a skull as a pillow, the tableau of a starving wolf being strangled by a skeleton and a pearwood skull hinged to reveal a miniature Adam and Eve on one side and the Crucifixion on the other. The most unusual— and most treasured—objects in his collection

are the ship models carved by French prisoners in British jails during the Napoleonic era. They did the work to keep from going insane, but had few tools or materials so most of the hulls are fashioned out of the bones of their dead, the rigging woven out of their hair.

As with most enterprises, Ken Thomson’s art collection is not exactly what it seems. It is nearly all owned by Thomson Works of Art Ltd., a company that allows him to write off its cost and be exempted from death duties. The Krieghoff paintings offer their owner an extra incentive: every Christmas, Ken lends one or two canvases to Hallmark Cards Canada, which sends him free Christmas cards bearing the imprint of his painting in return. “They give me 1,000 cards free and another 400 wholesale,” he boasts.

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Christie’s Best is placed on a separate plate to feed the rotating cleaning women. And to save on barber’s bills, Thomson has his hair cut by wife Marilyn. The only other Thomson residence is in Barbados, where he owns the Southern Palms Hotel. To maximize profits, Ken and Marilyn stay in a third-floor walk-up apartment whenever they visit instead of occupying one of the more luxurious main-floor suites.

Thomson owns a Mercedes 300-E but usually drives his ancient Oldsmobile—Gonzo’s favorite—and once purchased a red Porsche turbo. (“Honestly, not one of my more practical expenditures. I was thrilled at first but I hardly use it—I’ve probably driven not more than 25 miles in it this summer.” The car is for sale.) The Thomsons never entertain and seldom go out. When they do, preparations include discreet calls to find out precisely what other guests have been invited, whether anyone will be smoking or drinking, how soon they might comfortably leave and so on.

There has been much argument among his headquarters staff over how much cash Ken Thomson actually spends per week. Some insiders claim it’s $20; others insist it’s at least $40. No one bids any higher. He has credit cards but seldom, if ever, uses them. “It’s an idiosyncrasy,” says John Tory, his chief confidant. “It’s just very difficult for Ken to put his hand in his pocket and spend money. Yet he’s extremely kind and generous. When we’re rushing to a meeting and we’re late, if he sees a blind man, he’ll stop, miss a couple of lights and help him cross the street.” Tory didn’t need to add that the blind man gets no money.

Certainly, part of Thomson’s chronic niggardliness is due to his Depression upbringing. The Thomson household at Port Credit, Ont., which for a time included not only Ken but also his sisters, Irma (Sherry’s mother) and Phyllis Audrey, and most of their children, was run according to stem, puritanical precepts. “Granddad loved us very much,” Sherry recalls, “but the affection was always very gruff. It was a staunch, didn’t-comefrom-much kind of family, so that signs of affection came out almost by accident, as asides.” She remembers her mother being locked out by Roy, the family patriarch, if she ventured home after midnight. This was not when Irma was a teenager but well into her 30s, divorced, with a nine-year-old daughter, and dating again.

Luckily the family had German shepherds and a dog porthole had been cut into the sun-room door. Irma’s dating partners still recall having to push her, 1940s dirndls and all, through the dog door after their goodnights. “They could only do that in the summer,” according to Sherry, “because in other seasons, the ground got too wet. When I became a teenager, I was locked out by my mother in tum, and had to climb up the trellis.”

Young Ken had attended elementary school in North Bay, Ont., where he worked summers as a disc jockey in his father’s radio station, CFCH. His main job was to play background noises meant to evoke the crowd sounds and clinking glasses of a ballroom while big-band dance numbers were on the air, but he also fell in love with the music of Hank Snow and dreamed of some day actually meeting him. When the family moved to

Toronto, young Ken was enrolled in Upper Canada College. After an unsuccessful year at the University of Toronto, he joined the Royal Canadian Air Force but was never promoted beyond leading aircraftsman, the equivalent of a lance-corporal in the army, spending most of the war as an editorial assistant on Wings Abroad, a propaganda weekly.

He took his discharge in London and spent two years at Cambridge, though the university had no discernible effect on him. After spending a year on the editorial staff of his father’s Timmins Daily Press, he moved back to southern Ontario, where Roy Thomson had acquired the Galt Evening Reporter as one of four dailies he picked up in 1944. Ken’s five-

year apprenticeship there was an important formative influence.

Roy Thomson died on Aug. 7,1976, and Ken was suddenly in charge. His father had passed away both too soon, because the younger Thomson was not ready to take over, and too late—because Ken was by this time 53 and had spent most of his adult life following his father, a tactful step behind like a commercial version of Prince Philip. Inheriting a father’s business is always difficult; succeeding as powerful and articulate an individual as Roy Thomson—recognized as a folk hero of capitalism— was impossible. His father’s friend and adviser Sidney F. Chapman summed up the situation most succinctly: “When you live in the shadow of a legend, you don’t go flashing mirrors.”

The company then owned 43 daily and 11 weekly Canadian newspapers. They ranged geographically from the Nanaimo Daily Free Press on Vancouver Island to The Evening Telegram in St. John’s, Nfld. What they had in common, apart from ownership, was a blandness so pervasive that no self-respecting fish could bear being wrapped in one of their pages.

The Thomson operational code had been set down by Roy, but it didn’t initially change much under Ken. Both Thomsons regarded editors as expendable eccentrics to be hired and fired at will. To cut costs, reporters did not receive free copies of their own newspapers, and earnest bargaining went on to deprive delivery kids of half a cent in their

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THOMSON REGULARLY VISITS HANK SNOW AT THE GRAND OLE OPRY

meagre take-home pay. Most positions had fixed salary limits, so that anyone performing really well would inevitably work himself or herself out of a job. In pre-computer days, Thomson papers sold their used page mats to farmers as chicken-coop insulation and Canadian Press printers were adjusted from triple to double spacing to save paper. Each newsroom telephone had a pencil tied to it, so there would be no wasteful stubs floating around. “God help us if they ever realize there are two sides to a piece of toilet paper,” one publisher was heard to whisper at a management cost-cutting meeting.

Roy Megarry, the publisher of the Toronto Globe and Mail, who persuaded Thomson to invest $65 million in his paper’s national edition, insists there has been no editorial interference from the Thomson head office, a few blocks away.

“It’s one thing to own the Barrie Examiner and not interfere editorially,” he says.

“It’s another to own the Globe in the city where you reside and resist the temptation to put on pressure.”

But they haven’t. On Thomson’s 60th birthday, Megarry edited a special onecopy issue of the Globe, substituted on his doorstep for the real thing, that had a front page with Ken’s picture on it and several feature stories about Gonzo. “That morning, Ken did phone me,” Megarry recalls, “and said: ‘What are you doing, you rascal?’—he frequently refers to me as a rascal—and admitted he had been stunned, because for a split second he thought it

really was that day’s Globe. ‘It was a cute thing to do,’ he told me, ‘but I hope it didn’t cost the company too much money.’ ”

During the late 1970s, Ken Thomson had a unique problem. With oil prices up to as much as $34 a barrel, his share in the North Sea fields purchased by his father was throwing off annual revenues of $200 million. That’s not the kind of sum you keep in a savings account. Tax reasons, plus the wish to get into hard assets, dictated new acquisitions, but the chain had run out of cities, towns and even villages where they could maintain newspaper monopolies. Thomson went shopping for a safe, timeless investment for his family. That was why, in the spring of 1979, he purchased, for $641 million cash, 76 per cent of the Hudson’s Bay Co.

In running his complex operation, Thomson of course enjoys the advantages of proprietorship, so that he can be wrong without triggering any adverse consequences. He also has the supreme luxury of belonging

A KINGDOM FOR A WASTE-BASKET

In the winter of 1980, Ken Thomson used some of his North Sea oil proceeds to purchase, for $130 million, a major Canadian newspaper chain, FP Publications Ltd., but that projected him into new and unfamiliar territory. FP had fielded an impressive Ottawa news bureau under the inspired direction of Kevin Doyle (now the editor of Maclean’s) that included such stars of Canadian journalism as Allan Fotheringham, Walter Stewart and Doug Small. The bureau regularly beat the Parliamentary Press Gallery to the news. The problem for its members was that they didn’t fit in

with Thomson's usual bare-bones operation.

When FP’s Edmonton bureau chief, Keith Woolhouse, who was working out of his onebedroom apartment, asked for a waste-basket, Thomson’s executive vice-president, Brian Slaight, went ape. Doyle tried to defuse the situation by offering to send out an extra wastebasket from the Ottawa office.

“Is it excess to the Ottawa bureau?” Slaight sternly demanded, ever the champion of independent editorial control.

Doyle, who was in the midst of covering the federal election campaign, nevertheless calmly replied: “Well, if you mean, ‘Do we need it?’ No, we don’t.”

At last, a triumph for head office. Slaight could hardly contain himself. With great glee, he declared: “We have a truck that goes from Ottawa, to Toronto, to Winnipeg, then on to

Edmonton. If we put the waste-basket on the truck, it won’t hardly take up any room, and won’t cost us a cent!”

So the waste-basket journeyed across the country, and it took only a week and a half to reach its destination. But the Edmonton bureau’s troubles were far from over. Woolhouse wanted to rent an office and needed furniture. Slaight vetoed the initial $1,600 estimate, but later approved a $1,100 bid from a local repossession centre. That didn't save Woolhouse. He permanently blotted his copy book by purchasing his pens and paper clips on the open market instead of the repossession house. The Edmonton bureau was soon closed, as was the entire FP news operation.

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to a dynasty, so that financial results—good and bad—can be spread over generations instead of having to meet quarterly projections. The HBC’s stock values didn’t climb back to their original purchase price for more than a decade after his original purchase, but there was never a thought of liquidating or seeking other drastic remedies. “We never have to keep looking over our shoulders at people taking over any of our companies,” John Tory pointed out. “Even when we make major acquisitions that have an initially negative impact on our profitability, in the longer term we’ll have a broader base on which we’re able to grow. It’s really that simple.”

In truth, business does not govern Ken Thomson’s life; he is much more involved with his family. “He has so much love and affection with the family and Gonzo,” says his son David, “we get so much pleasure just seeing him and trying to make him happier.”

David likes to quote the maxim of Meyer Guggenheim, the Swiss-born American industrialist who maintained a family dynasty by handing each of his sons a stick and asking them to break it. They did. He then gave each a bundle of sticks, which they couldn’t break. “Stand alone, and you will be broken,” he told them. “Stand together, and no one will break you.” The Thomson family very much sticks together; they are proud and protective of one another, especially in tragic circumstances.

Just two weeks before Christmas, 1990, Gonzo died. “I’ve had the loss of dear ones, human beings,” Ken lamented, “but I’ve never experienced anything that shook me more than his death. Gonzo slept with me the last night. I held the little guy in my arms and I thought, I can’t really stand this. I left the room and then I thought, no, he really needs me. I’ve got to be there. I felt him expire. I don’t want ever, ever to go through such a thing again. . . . ” □

WHERE CHARITY STAYS AT HOME

Though he is the world’s eighth-richest man, Ken Thomson is one of Canada’s most reluctant philanthropists. When TorontoDominion Bank chairman Richard Thomson (no relation) and Fredrik Eaton, head of his family’s department-store chain, called on the wealthy press lord to solicit funds for the Toronto General Hospital, a favorite Establishment charity, they were warned by a mutual friend that the only way they could get any money was to pledge construction of a veterinarian wing to treat Thomson’s beloved dog, Gonzo. They thought it was just a joke, but they came back empty-handed.

Thomson’s only excursion into philanthropy was his successful 1982 effort to have Toronto’s premier concert hall, the magnificent structure designed by Arthur Erickson, named after his father. He gave

$4.5 million to the project, the largest donation ever granted to the performing arts in Canadian history. “Dad would have been thrilled,” he says. “I’m so proud to hear it on the radio sometimes, ‘Roy Thomson Hall’—my dad’s name being mentioned—or see it in the Globe and Star.”

He was born on Monteith Street and loved Toronto. He even tried to use Lord Thomson of Toronto as his title, but the Conservative government of John Diefenbaker wouldn’t let him. Still, a cultural, especially musical edifice hardly seemed an appropriate monument. “I could do without culture,” Roy Thomson once confided. “I haven’t got any, particularly. And I could do without art. I can do without the theatre. I can do without all these things. Some people love culture. They live on it. They appreciate it and I rather envy them in a way. But, not for me. My favorite music is about the level of Gigi. I like tunes like The Blue Danube waltz, Sailing down the River and songs from South Pacific.”

The naming of Roy Thomson Hall caused a critical and political furor. Of the $39 million

required to finance the building’s construction, $26.5 million had been allocated by the federal, provincial and municipal governments; another $12.5 million had been raised from corporate donors.

The Thomson contribution was a welcome but hardly essential windfall to be used for future improvements, which to many minds did not warrant naming the hall after Roy. Moreover, accountants quickly calculated that the magnificent gift would not really cost Ken much. The $4.5-million donation was divided into five $900,000 annual instalments, paid through a Thomson subsidiary. As well as saving $450,000 a year in deductible taxes, the delayed instalments earned interest of more than $500,000, leaving the great benefactor a bill for only $2 million.

That’s not all. When they attend Thomson Hall concerts, Ken and and his wife, Marilyn, regularly phone down for free house seats—and get them.

P. C. N.