Loews

"In March 1974, for example, Loews purchased a 5 percent stake in CNA Financial, disavowing any plans for a hostile takeover. By May, however, Tisch said he would seek a controlling interest, explaining that he had belatedly identified mismanagement as the source of the insurance company’s undervaluation. He succeeded in acquiring a majority stake, after first dropping his initial bid when CNA’s earnings deteriorated. Once in place, Tisch swiftly fired the company’s chairman and eventually cut employment by 12 percent. He closed down CNA’s three floors of lavish executive suites and downsized or dumped poorly performing busi¬ nesses that management had previously acquired in an effort to diversify. By the end of 1975,Tisch’s shock treatment had transformed a $207 mil¬ lion annual loss to a $110 million profit.38"

"on stocks in the Loews portfolio as well. Tisch’s style was not to take profits at the top of a market; it was to seek a haven—high-yielding bonds—before the whole world decided to do the same thing. Tisch had not achieved success by running with the herd."

"this latest target’s assets. The criticism was understandable. Tisch fre^ quently sought to convert assets into cash, but his purpose wasn’t siim ply to raise cash. The assets earmarked for sale were always those that didn’t yield a decent return and held little potential for doing so in the near future without a costly overhaul. Lorillard was no different. The candy and petTood lines didn’t meet Tisch’s requirements for cash flow. Ultimately, they would go. In time, Loews would come to depend heavily on the cigarette business for much of its earnings."

"a tax saving of $1,235, assuming a 50 percent tax rate. That would make the after-tax interest cost $1,235 a share. Subtract that cost from the $1.66 after-tax income from the dividend, and Loews would end up with an after-tax profit from the Commercial Credit dividend of 42.5 cents a share. The effect would be a takeover completed with interest-free debt and a built-in price discount on the share purchase. —"

"The key to the Tisches’ success was hands-on-management. As one former executive put it: “Loews people usually know within a week if anything happens in any of their companies. They have taken away all bureaucracy, all impedimenta.”"

"A few days after Derow was fired, Tri-Star Pictures, the film ven- ture CBS had recently abandoned, bought Loew’s Theatre Manage- ment Corp. from Jerrold Perenchio for nearly twice what he had paid Loews a year earlier. Tisch’s critics later pointed to the deal as evi- dence that he frequently sold assets too cheaply. But whether selling stocks or corporate assets, it wasn’t Tisch’s aim necessarily to make a killing—he just wanted at least a return that made the investment suf- ficiently profitable. Better to sell something that turns out to be even more valuable than to have a buyer who ends up feeling cheated."

"“Loews is entrepreneurial,” Pollack said at the time, “[operated by] good businessmen who understand diverse industries and can apply management techniques to a varied group of companies.”"

"Jonathan Tisch had said earlier that year. “I was somewhat frustrated in the late 1980s when we weren’t doing deals like everyone else. They kept saying, ‘Let’s wait.’” Loews waited and, as a result, it sat in the middle of an overbuilt hotel market with plenty of cash and with plenty of desperate developers willing to sell properties at less than what it had cost to build them. In 1991, the average hotel property sale, on a per-room basis, had plunged 40 percent."