More Martin S. Davis of Gulf & Western

Sharpening the Focus
Martin Davis is reshaping Gulf & Western to make it a player in the developing battle of global communications powers.
April 12, 1989|PAUL RICHTER, L.A. Times Staff Writer

NEW YORK — Martin S. Davis became chief executive of Gulf & Western in 1983, when corporate raiders like Carl C. Icahn and Carl Lindner were buying the giant conglomerate's stock in hopes of forcing a merger that would earn them millions.
Ivan F. Boesky, the fallen stock speculator, even plopped down on a sofa in Davis' Manhattan office one day and tried to pressure him into moves to increase the value of Boesky's stake. "He had an armed bodyguard waiting for him outside, so I can't say I threw him out," Davis said. "But I asked him to leave."
Boesky and the raiders got the message. They soon sold their shares and haven't mounted a serious challenge to Gulf & Western since, though the company has never bothered to put the standard anti-takeover defenses in place.
New Evidence of Resolve
Davis has often shown such determination in the past six years, as the Bronx-born, 61-year-old executive has reshaped Gulf & Western from a ragtag agglutination of about 100 businesses to a thriving corporation focused in entertainment, publishing and finance. This week, Davis' resolve was evident again, as he announced that Gulf & Western will sell its huge consumer finance business to try to evolve into an even larger global entertainment and media firm.
Davis' plan is to auction the finance arm, Associates Corp., then reinvest the $3 billion-plus of proceeds in new entertainment and media companies. The acquisitions will complement holdings that include the Paramount movie and TV studio, the big Simon & Schuster and Prentice Hall publishing businesses, and interests in cable networks, TV stations and sports teams.
The goal is to make Gulf & Western a player in the developing free-for-all between such global communications giants as Rupert Murdoch's News Corp., the now-forming union of Time Inc. and Warner Communications, the West German Bertelsmann AG, and the French Hachette SA.
Davis makes clear that he will try to reach the new goal by urging on his troops in the way that has given him a reputation as one of corporate America's toughest bosses. "Weak people have a problem, with themselves as well as with me," he says. "I don't work well with incompetents."