Who's in charge here? At Fuqua Industries, it is not J. B. Fuqua, founder and chairman of the Atlanta-based conglomerate. It is a triumvirate of executives -- all in their 40s -- appointed by Mr. fuqua to continue his patter of growth-by- acquisition for the company that had $2.2 billion in sales last year.
That, at least, is the message the company seems to be trying to project as it sends these executives around the country talking to financial advisers and stockbrokers.
Mr. Fuqua, you see, is approaching retirement. And since the former Georgia legislator founded the company in 1965, the firm has earned a reputation as a one-man show -- starring J. B. Fuqua. With businesses that include trucking, sporting goods, photofinishing, petroleum distribution, lawn and garden equipment, and food products, Mr. fuqua has kept himself busy buying companies, shedding them of their unprofitable parts, and helping them grow. Now he wants people to know that Fuqua Industries can make it without him.
Mr. Fuqua is one of a dwindling "generation of entrepreneurs" who like to buy and sell companies, not for the money, but because "it's what they like to do and it gives them satisfaction," says Carol Neves, an analyst with Merrill Lynch , Pierce, Fenner & Smith in New York.
Fuqua has more than 20 subsidiaries, several of which were acquired in the last three years. The subsidiaries include such companies as Interstate Trucking of Grand Rapids, Mich.; McDonough Power Equipment, which makes Snapper lawn mowers in McDonough, Ga.; Ebonite, a manufacturer of billiard tables and bowling balls in Miami and Hopkinsville, Ky.; U.S. Cycle Corporation, a Columbus , Ohio, maker of motorcycle parts and accessories; and Stormor, a builder of grain drying and storage bins in Fremont, Neb.
"The company is very acquisition-oriented," Miss Neves says, and as a result has had a fairly heavy debt load relative to its capital. But that situation was eased with the recent sale of three television stations. The sale of two radio stations is also in the works. The TV-radio deal is expected to bring in some $65 million, much of which will be used to buy shares of the company's own stock. "I think the company looks quite good," she concludes.
However, not enough other people in the financial community are aware of what the firm can do, Mr. Fuqua maintains. So two of the three executives now in charge -- Kay W. Slayden, president, and Lawrence Klamon, senior vice-president for finance -- were in Boston recently to bring this message to the investment community. The third member of the triad is James T. Hite III, executive vice- president.
Often, acquisition-minded corporate executives travel around to analyst groups in several cities in an effort to boost the price of their company's stock. This makes it cheaper to purchase new companies by using the now higher-priced stock.
Speaking of Mr. Fuqua, Mr. Klamon said: "He's spending less and less time on the company. He is definitely phasing himself out."
Before he retires, "J. B.," as both visiting executives call him, wants to make one more major acquisition for the firm that bears his name. And he wants the purchase to give Fuqua Industries the major conglomerate status he feels it deserves. To do this, he is looking for an international, consumer-related company hat is so well known that the deal would propel Fuqua into prominence with the likes of TRW, Gulf & Western, and United Technologies. Mr. Fuqua has said he is looking for a company with a name familiar in three-quarters of the world.
Two recent attempts to land such a well- known company have failed. In 1977, Fuqua tried to purchase Avis Inc., the car rental company, but was outbid by Norton Simon Inc., another well-known conglomerate. And last year, its attempt to buy the Hoover Company also feel through when the vacuum cleaner manufacturer's stockholders turned down the offer.
Without a big-name additition to its corporate lineup, the company will not get the reputation its performance would indicate, Mr. Klamon commented. "Our performance has certainly outstripped the market's recognition of it."
Since 1977, Fuqua's sales have jumped from $631 million to $1.6 billion in 1978 and $2.2 billion last year. Its net income has climbed from $16 million to similarly increased, from $1.71 in 1977 to $2.25 in 1978 and $5 last year.
Much of this growth is the result of a single thing -- another acquisition. In 1978, Mr. Fuqua broke a longstanding pattern of buying only companies that were both well managed and successful and bought National Industries, a diversified firm that was larger than Fuqua, but one that had some losing parts.
The purchase cost Fuqua $67 million -- $32 million in cash and $37 million in stock. But Mr. Fuqua quickly sold off those portions of National that seemed to have little chance of turning a profit quickly. The selling price for the castoffs was $32 million, meaning that Fuqua in effect used parts of National to buy National. Since the acquisition, Mr. Slayden claims, the slimmed-down National has earned back the $35 million in stock value. The addition of National is seen as the main reason behind the big jump in sales and earnings last year.
Even though he is preparing the company for his retirement, Mr. Fuqua is not phasing himself out of the business world entirely. He has bought controlling interest in SG Securities, an investment company listed on the American Stock Exchange. He plans to use this company to make more acquisitions after he retires from Fuqua Industries.
"This will be his retirement activity -- buying and selling more companies," Mr. Klamon said.