Business

The man who would rather be Lord of the Bay

Ian Brown March 12 1979
Business

The man who would rather be Lord of the Bay

Ian Brown March 12 1979

The man who would rather be Lord of the Bay

Business

Physically speaking, it isn’t far from Ken Thomson’s Krieghoff-strewn offices in the Toronto headquarters of the Thomson organization to Donald McGiverin’s office in the Bay: out to Yonge Street, turn left, and you’re almost there. Conceptually, though, it’s miles—a connection you would never make on your own. Especially last week, when Thomson, son of the late Roy, Lord Thomson of Fleet, walked into the Hudson’s Bay president’s office and told the biggest marauder of them all he intended to buy 51 per cent of his

company for $365.2 million—cash.

A nice irony. Not two months after he corralled some 87 per cent of Simpsons in the retail handshake of the decade, McGiverin himself was take-over bait in an offer still being assembled by Thomson and Toronto lawyer John Tory, twin and partner in law to Jim Tory, the man who unsuccessfully defended Simpsons against McGiverin. But Simpsons’ revenge had nothing to do with it, Thomson says: he is attracted by the Bay’s valuable oil, gas and land assets, as well as by its future and its 309-year past, and intends to do nothing save add his and Tory’s names to the Bay’s board. “What it is, is the Hudson's Bay Company—a magnificent Canadian company,” he gushes. “This is a long, long-term investment.”

That remains to be seen. Even as Thomson enthused, an election-conscious House of Commons—years too late, it seems—was calling for tougher anti-combine laws and for an investigation of the deal by both the government’s combines branch and the Foreign Investment Review Agency. Meanwhile, stock market analysts across the land dreamed up counter-offer candidates: Canadian Pacific Chairman Ian Sinclair, Brascan Chairman Jake Moore and, of course, Conrad Black. But the most likely was least fingered: Bay Director Joseph Segal, the Vancouver retailing and real-estate whiz of whose own Zeller’s Ltd. he convinced McGiverin to buy 58 per cent last October. Though he wouldn’t comment, Segal is the Bay’s single largest shareholder and therefore crucial to any take-over battle. At least it will be profitable: two hours after trading in Bay shares reopened last Friday, the stock had climbed nearly $6 to $28.75.

Any take-over battle would be formidable. “I can’t see too many people getting involved, not at $31,” says one Toronto financier, noting that Thomson’s offer of $31 a share topped the then going price of Bay stock by some 35 per cent. All the better for the quiet dreams of Ken Thomson. For years content to collect exquisitely expensive carvings of ivory and jade while his father amassed the stuff of less fragileq

dreams—including two North Sea oil wells, television stations, The Times of London and the immensely profitable Thomson Newspapers Ltd. (1977 profits of $47.4 million)—Ken Thomson is nonetheless the man who, leery of Britain’s future, has slipped around foreign exchange controls there and returned to Canada the assets of the Thomson Organization, 81 per cent owned by Roy Thomson’s heirs who, in turn, control Thomson Equitable (International) Ltd. and Woodbridge Co. Ltd., the two companies through which the offer for the Bay is being made. Now, at 55, Ken’s own time has come. Roy Thomson, striving upward, traded his Canadian citizenship for a peerage which, hand in hand with ownership of The Times, he considered his greatest achievement. Ken Thomson, striving deep, uses the inherited prefix only when he has to in Britain and Europe. “In Canada,” he smiles, “I’m delighted to be just who I am.” Ian Brown