Business

How to be happy

If you’re Barrick founder Peter Munk, it’s all relative

Kimberley Noble November 12 2001
Business

How to be happy

If you’re Barrick founder Peter Munk, it’s all relative

Kimberley Noble November 12 2001

How to be happy

If you’re Barrick founder Peter Munk, it’s all relative

Peter Munk sweeps into the Barrick Gold Corp. boardroom in Toronto, Jack Welch’s tough-talking autobiography under his arm. He says Randall Oliphant gave it to him. Somebody else at Barrick comments later that the Welch book—subtided Straight from the Gut— was Munk’s idea in the first place, and that he was the first to start handing it around. It doesn’t matter. The point is, Munk, who is constandy on planes, no longer has an office at the firm. His two huge companies, Barrick and real estate developer TrizecHahn Corp. of Toronto, are in the middle of enormous reorganizations, and he’s been in meetings all afternoon. He’s relegated to being the one who has to visit other people in their offices—something colleagues say he appears to enjoy—and he has to carry everything he needs around with him. The book is a reminder, in case you didn’t already know, that he’s in transit. Peter doesn’t live here anymore.

So what is he doing, exactly? “What am I doing now?” he snaps back, enjoying himself. “What do I do day by day? Not much.” This is not, of course, strictly true. Turning 74 this week, Munk is still a force to be reckoned with. His hair is whiter and his eyes have lost a bit of their electric blue, but he remains chairman of Barrick and TrizecHahn, companies that he either founded or, in the real estate company’s case, rescued out of bankruptcy and built up to the point that they’re now worth a combined $13.1 billion. Through his personal holding company,

Munk still has sizable stakes in both corporations—he controls TrizecHahn outright through multiple voting shares; TrizecHahn owns 7.7 per cent of Barrick, and he owns about one per cent. And he continues to worry about what happens to these companies; he calls them “my babies.”

On the other hand, he is moving on. This year, apparendy for the first time in his life, Munk has actually handed his corporate offspring over to the men he’s chosen to succeed him as chief executives: Barrick’s Oliphant, 42, a former chartered accountant who took over in 1999, and Trizec CEO Christopher Mackenzie, 47, who used to work for Jack Welch at GE and who has been running the real estate company since last December. And as far as he’s concerned, Oliphant and Mackenzie really are each the ultimate boss. “I have taken many steps back from being direcdy involved in the operations,” Munk says in the only interview he claims to have done during this whirlwind visit to Canada. “This is what my aim was when I got to a certain point in life. And I am doing that.”

Munk says he’s still involved in strategic planning. For example, shareholders will remember how upset Munk was at last year’s TrizecHahn annual meeting, when he apologized at length for the lousy stock price. The company is an Alist player, a sprawling office and shopping centre developer that owns Chicago’s Sears Tower and is currently putting the finishing touches on the Hollywood entertainment complex that will become the new permanent home of the Oscars. After selling U.S. shopping centres and Canadian office towers, TrizecHahn is solid and well-financed, but it has been dramatically undervalued compared with similar property portfolios that are held in U.S. real estate investment trusts. So Munk spent the past 18 months working out a way to turn the Canadian company into a U.S. REIT without incurring a crippling tax liability. Real estate analysts are calling this transaction, unveiled on Sept. 25, the most complicated deal they’ve ever seen. “It’s been like giving birth,” says Munk.

Now, with the TrizecHahn deal behind him, and Barrick’s merger with Homestake Mining Co. well under way, Munk says he’s looking forward to being out of the office as much as possible. Worth more than $300 million, he insists he has no other business interests. “I do nothing with my money,” he laughs. “You can check with my accountant. I don’t sit around tax planning, I don’t sit around making investments. I am very happy.”

Outside of the companies, the only assets he owns are houses: one in Switzerland (for the skiing, among other things), another in Toronto, and his favourite, a summer cottage on a Georgian Bay island that he bought decades ago when he was young and broke. He came to Canada after his family fled Hungary during the Second World War. “I’m very proud of what I’ve done in Canada,” he says. “I’ve achieved all that I want to achieve, and I am having a relatively good time. I have a relatively good marriage and I have relatively good kids and I have relatively good businesses. Sure, gold could have gone to $450 an ounce and Barrick could have been worth $14 billion. Trizec’s stock price has been flagging. But then,” Munk says, peering back over his shoulder, “I look at Nortel and life is not so bad.”

Kimberley Noble