Before 1987, I was on a path to one day having the largest shareholding in the company and being chairman — possibly chief executive. After 1987, that all changed.
I launched the AUS $2.25B takeover in August 1987 of John Fairfax Ltd., a large diversified media company that, at its height, included newspapers, television stations, radio stations, magazines, and newsprint mills. With The Sydney Morning Herald, The Age in Melbourne, and The Australian Financial Review, it had the equivalent of The New York Times, The Washington Post, and The Wall Street Journal of Australia.
By December 1987, the company was over AUS $1.5 billion in debt. The debt was so large that when Australia went through a recession in 1990, the company went bankrupt — and the company passed out of family control.
It was the end of a dynasty.
THE TOUGHEST EXPERIENCE OF MY LIFE STARTED IN JANUARY 1987, WHEN MY FATHER DIED.
Some family members had forced my father to resign as Chairman in 1976. He remained on the board until his death, but he had issues with how the company was being run. My father was a man I greatly admired and revered; after his death, I felt his mantle had fallen to me. I was 26 and in my last year at Harvard Business School.
In early 1987, there was a rise in the company’s stock price. The market seemed to feel that the company was “in play” following my father’s death. I felt that the company was not being managed well — and not according to the ideals of its founder, my great-great grandfather, John Fairfax.
Corporate raiders were lurking. I felt that I had no choice but to try everything in my power to preserve family control of the company and to ensure that it was well run in line with the ideals of John Fairfax.
WHILE MY CLASSMATES WERE STUDYING FOR FINAL EXAMS IN OUR LAST SEMESTER AT HARVARD,
I WAS ON THE PHONE WITH BUSINESS ASSOCIATES IN
AUSTRALIA DISCUSSING A TAKEOVER BID.
In August 1987, I launched a AUS $2.25B takeover bid for John Fairfax, Ltd. It was considered one of the largest takeovers in Australian corporate history at the time.
Almost from the beginning, things went wrong. Other major family shareholders sold out. The October 1987 stock market crash hurt our asset sale program, lowering the prices we expected to receive. It all led to a crippling debt load.
I brought in a new chief executive, who succeeded in increasing operating profits by 80% in his first year. We tried numerous refinancings to stabilize the effect of the significant debt load. But by 1990, Australia was hit by a recession, which had a major effect on profitability.
WITH THE AMOUNT OF DEBT WE HAD, THERE WAS NO MARGIN FOR ERROR.
THE RESULT: IN LATE 1990, THE COMPANY WAS FORCED TO
FILE FOR BANKRUPTCY.
THE DECADE AFTER THE COMPANY WENT INTO
BANKRUPTCY WAS CRIPPLING FOR ME.
I had made many mistakes and poor assumptions. When the company’s stock price rose early in 1987, was the company really in danger — especially if the large family shareholders stuck together? Why would they want to remain in a privatized family company that I controlled? While my father and I may have had issues with how the company was being run, was the takeover really necessary?
Though this was very painful,
And born out of all of this came a philosophical approach to living and leading a life of authenticity and significance.
Those difficult times were the most refining moments of my life.
I did a lot of soul searching. I had wanted to preserve the family company and see it be well run — but the opposite happened. For my whole life, I had prepared to take a leading position with the family company. What was I to do now? What purpose did my life have? The trials that I went through taught me a lot about myself — who I was but also who I was not. They have led me on a journey that has given me clarity about who I truly am and what my purpose and passions are.
One of my biggest mistakes was trying to be who others wanted me to be.
My parents saw me as the savior of the family company who could carry on after my father and ensure that the company was well run in line with the ideals of the founder. But here’s the problem: This was not my dream. It was my parents’ dream. I did not have the skills or experience to live it out. I was not some take-charge, no-holds-barred chief executive. That was not my design.
You cannot inherit a vision. I tried and failed.
If it is not your vision, no matter how noble it is, do not try to make it your vision. I loved and admired my father very much. I admired the legacy and many positive contributions past generations had made to the company and to Australia since John Fairfax founded the company in 1841. But, in the years after John Fairfax, Ltd., left family control, I realized that the vision I had for the company was not my vision. My own vision is different, based on who I have been designed to be.
I have a much clearer picture of who I am, what I am passionate about, and the vision for my life that lines up with that.
I am a reflective adviser. I try to ensure that everything I do lines up with that. Being on the board of organizations whose mission I am passionate about is a good fit. Writing and sharing foundational leadership principles is also a good fit. So is executive coaching, in which I try to help leaders find their own journey to being great leaders and turning their visions into reality.
A LIFE OF SIGNIFICANCE.
We have lived in Annapolis, Maryland, not far from Washington, DC, for over 25 years. I am a writer and executive coach focused on leadership. I am on the board of my children’s school, Annapolis Area Christian School, and an elder at Bay Area Community Church. Between these roles — my writing, my coaching, the organizations I am a part of, and my family — life has never been more fulfilling. I feel blessed to have a wonderful wife, three great kids, good friends, and to be doing work that I believe in.
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