Chapter 6

 

Kane Masterson, CEO of Preston Industries, smiled as he sipped the eighteen year old Glenlivet scotch. It was his second glass of the morning and it was only 10 o’clock. Drinking in the morning was not normal behavior for Kane, but today was a very special day. He was celebrating the events of the last two hours. Events that would reshape his destiny.

He arrived at his office at exactly 8 o’clock anxious to receive a call from a contact at the SEC that would confirm that shares of Preston Industries were estopped from floor trading at the stock exchange and that   they were being subrogated three to one by shares of Hampton Industries.

The second call would be from his broker, confirming that all of his newly acquired shares of Hampton Industries were sold at the market. Give or take a few hundred thousand for fees, Kane anticipated proceeds from the transaction to net in the neighborhood of twenty million dollars; a neighborhood he has wanted to move into all of his adult life.

Both calls were received by 9:40.

At age thirty five, Kane Masterson had been the youngest CEO in the company’s history. A graduate of Northwestern and Wharton, he was recruited by Preston Industries as a Senior Financial Manager. He rose rapidly through the ranks of the finance department, earning a reputation as a corporate hatchet man. His streamlining of the six corporate divisions saved the company three hundred million dollars and cut payrolls by thousands of jobs. These successes earned Kane a promotion to Vice President of Finance and a year later to the position of CEO. His ascent from Senior Manager to CEO took eight years. During the year prior to becoming CEO, Kane distinguished himself by managing Preston’s successful defense against the hostile takeover bid by Hampton Industries. Now the takeover had finally happened, but it was on his terms.

His calendar had only one entry for today, a 12 noon meeting with Adam Hampton III. This was a meeting he looked forward to with anticipation. Two weeks earlier it was confirmed that Adam Hampton III had finally garnered enough stock to acquire Preston; the takeover that Kane covertly maneuvered Adam into making by releasing for sale, through dummy receiverships, privately held blocks of Preston shares. Adam was unaware that Kane was holding a trump card and that Preston, rather than becoming a crown jewel in the Hampton Industries group of trading companies, would instead become a drain on the corporation’s bottom line. Within a month, five key customers and four trading partners planned to transfer their business to a European consortium. The contracts had already been signed. Kane knew that this loss would precipitate a drop in Preston’s sales of at least forty percent and profits by more than fifty. This tightly held information was Kane’s dirty little secret. He came upon the details of the plans completely by accident; through a friend of a friend. There would be no possibility of him being accused of insider trading. He would have the last laugh after all and would walk away a multi-millionaire. Adam Hampton III would be left with egg on his face, the laughing stock of Wall Street. Poetic justice if ever there was any.

Kane’s reverie was interrupted by the phone. It was his mother.

“Hi, mom! Did you call to console me?”

Kane planned to carry on the pretense of being a defeated man, even with his mother. He couldn’t risk telling anyone about his plan, especially Evelyn Littleton who wasn’t exactly tight lipped when it came to juicy gossip, especially about the Hamptons.

“I’m so sorry, Kane. Is there anything I can do for you?”

“It’s not so bad, mom. Actually, I’m quite fortunate. The bastard made me a very rich man by bidding up Preston stock. Finally all those stock bonuses are paying off.”

“When can you walk away and leave it all behind you?

“It’s going to be a while. I agreed to work with them for at least six months, that is, if they can stand having me around that long. I’ll know better in a couple of hours. I have a noon meeting with son of a bitch himself. It’s a one-on-one so I guess that by the time the meeting is over, I’ll know exactly where I stand. Actually, I’m looking forward to it.”

Evelyn was quiet on the other end.

“Mom, are you still there?”

“Yes, I’m here dear. I was just thinking what a shallow victory it must be for them after all these years. From what I hear, his father has a very advanced case of Alzheimer’s. I doubt that he can even comprehend what has happened. Although, I can’t say, that under the circumstances, I really feel any sympathy for him or for his family.”

“I understand your feelings, mom. But you also need to understand that if his father hadn’t made the initial run on the company several years back, I probably wouldn’t be where I am today. I realize now that all we did was postpone the inevitable, but since that time our stock price has doubled. They’re paying a very high price with the three shares-for-one formulation for the remaining shares outstanding. To me it looks like their drive for revenge led them into making some unwise business decisions that will come back to haunt them. It’ll take years to make the merger pay off. I don’t know that their Board of Directors will have the patience to wait for a return on their investment. Their stock will eventually reflect the high cost of their decision to buy up Preston’s shares.”

“That’s the other thing I wanted to talk to you about. Would you do me a favor and call Jerry? Have him sell the new shares of stock I’ll receive from the takeover. I don’t want to own any part of that company, even for one day.”

Kane had given his mother blocks of Preston stock for the past five years in deference to her persistent refusal to provide a list of gifts he could get her for mother’s day, her birthday and Christmas. Much to his surprise and relief, she was pleased with his choice. This morning Evelyn Littleton’s fifteen hundred shares of Preston Industries had grown to forty-five hundred shares of Hampton Enterprises.

“Sure, mom. I’ll take care of that as soon as we’re finished. Do you want to leave the proceeds in the account or should I have Jerry cut you a check?”

“Oh, you can leave it there for now. We’ll find something else. Maybe you’ll startup a new company and need an investor. You know that I’ll always be there for you.”

It got quiet again. Kane’s mind raced for something else to discuss with her. He suspected that her spirits were low because of her pending divorce, but he preferred not to venture into those waters. He took the safe path, instead.

“What’s going on with my sisters?”

“Nothing much. I haven’t seen or heard from either of them in several weeks. I think Melanie is away on a trip, so I don’t expect to hear from her until she returns. She never sends cards or anything when she travels. Bridget is taking some courses during the day. I think she wants to get a teaching certificate. That’s about it.”

“How about those darling grandchildren of yours? Do you see much of them?”

“They’re as precious as ever. No, I don’t get to see them as much as I used to, but when we do get together we have a lot of fun. They haven’t tired of visiting their ‘nana’ yet. Tell me, what else is new with you? What will you do with yourself when this is over? Have you made any plans?”

“Once my obligatory time is done, I’ll have to find something to work on. I’ve sent out a few feelers, but I don’t have anything specific yet. New England is kind of tight right now due to the economy. I may have to make a move to the west coast.”

“Oh, I hope not. I would miss you terribly. What about your love life? Are you seeing anyone special?”

“Not right now, mom. I was dating someone from an economics research firm. She was a very bright lady, but a real Jekyll and Hyde. She was all business during the day, but at night she turned into a swinger, complete with drugs and sexual deviation. I survived one night with her and made a clean break. When I find the right one I promise that you’ll be the first to know.” He hesitated for a moment. “I think I’m going to have to cut this short, mom. My meeting with Adam Hampton is at twelve and I have to put some last minute figures together for the meeting.”

“Well, don’t you let him put anything over on you. I hear he’s a slick one. That whole family has a bad reputation when it comes to dealing with people. The less you have to do with him, the better.”

 “Don’t worry about me, mom. I can take care of myself.  I’ve dealt with shrewder people than he will ever be.”

“Well I certainly hope so. Take good care of yourself, son. Don’t take any nonsense from those people. I’ll be praying that everything works out well for you. Bye for now!”

“Bye, mom!”

He made a hurried call to his mother’s broker and placed an order to sell at the market.

Kane was now ready to take on Adam Hampton III. It was an encounter he has looked forward to with anticipation for the past three months. Things were going according to plan.