Barbarians at the Gate by Bryan Burrough, John Helyar Read Free Book Online Page B

business, with Standard Brands International as his only customer. He bought things at Emmett’s behest, Johnson explained, but Emmett, when confronted, insisted everything was aboveboard. Johnson went to bat for his buddy: Investigate it thoroughly, he said, but allow Emmett to become president now.
    Emmett’s elevation to the presidency was announced, but not a subsequent internal probe by the company’s longtime law firm. As the months wore on and the investigation continued, there was rampant speculation inside the company that both Johnson and Emmett would lose their jobs. In September, the final verdict was reached: bad judgment, perhaps, but no bad deed. Emmett got off with a slap on the wrist. Instead it was his three accusers—Schaedler, Pines, and an executive named Ed Downs—that Johnson fired. Applegate was banished to being a consultant.
    “I’m sending you people out on the boat,” Johnson told the trio, “and you’re not coming back.” The episode was to be forever known amongJohnson’s entourage as the “boat people incident.” For Johnson, it provided one of the few moments of jeopardy and strain he would ever know with a board.
    Afterward, he seemed restless. After four years Standard Brands was still an erratic performer. Its profits were growing again, but no faster than the rate of inflation. Its rate of return was well below the industry norm. Carbonell was working on all sorts of projects out at the R&D center—a fat-free peanut and improved fermentation for corn syrup, yeast, and vinegar. But new products took time, and Johnson was growing fidgety. For a while he kept busy by selling the yeast business and buying some liquor companies. But it was as if Standard Brands was a toy he had gotten for Christmas, and Johnson, having played with it for five years, was getting bored.
    Part of his disaffection was due to the fact that Johnson, now moving into his late forties, was no longer the boy wonder of the mid-seventies. The idea of becoming a sedate corporate elder made him shiver. He wasn’t interested in growing older; he longed to be the enfant terrible, the eternal shit-stirring youth. Everything about him, from the still-shaggy hair to his twenty-six-year-old second wife, suggested a corporate Peter Pan. What was needed, it was clear, was a new adventure.
    The opportunity came in a curious phone call from a fellow chief executive in March 1981. Bob Schaeberle, chairman of the food giant Nabisco, told Johnson his people had gotten a call from that fellow in Connecticut working for Standard Brands. Johnson didn’t know what Schaeberle was talking about. You know, the Nabisco chief said, the fellow who had the idea of merging Standard Brands and Nabisco. Johnson didn’t know. “Maybe there’s something there, and maybe there isn’t,” Schaeberle said, “but I think we should talk about it,” Um, sure, Johnson replied.
    But first Johnson wanted to discover the identity of the agent provocateur putting his company in play. “Who the fuck is this guy?” he exploded at a Monday morning meeting of his top lieutenants. Jake Powell, the chief financial officer, and Dean Posvar, the top planner, fessed up. The man was a Greenwich-based business broker they sometimes used to come up with minor acquisition ideas. Apparently he had gone overboard. “Well, if there is anything to this idea, Bob will sure as shit never want to do it now,” Johnson said. “Shit, he’ll think I don’t know what the hellis going on in my own company. And you know what? He’s right. I don’t know what the hell is going on.”
    Nevertheless, Johnson was intrigued. He got together with Schaeberle and liked the man. In a matter of weeks the two executives agreed to merge their companies. Nabisco Brands, as the new company would be called, was formed in a $1.9 billion stock swap in 1981, at the time one of the larger mergers of consumer-product companies. Technically, it was a marriage of equals. But that was