Tisch

"To triumph as often as he has, Tisch has thumbed his nose at conventional wisdom. He buys companies or stocks when they are wildly unpopular and shuns anything that is remotely in vogue.30"

"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"

"“You don’t have to bid against anyone. This merger makes more sense to QVC shareholders than being bought out for a premium.” Tisch, without a pause, snapped back: “I don’t get into contests, and I don’t look at what might have been.” He announced that night that the QVC deal was dead and buried and he was going to give a dividend of a billion-plus dollars to their shareholders to make them happy. It was over—my year and a half since storming out of the Fox gates with so much heat and moment was ending in ignominy."

"It wasn’t the first time he had more than made up for the lack of a plan by having acute radar for a rare investment opportunity, a ready load of cash, and the unshakable self-confidence to move swiftly. Those were the qualities that, in the span of 20 years, transformed Tisch the hotelier into Tisch the conglomerateur—all the while prov- ing himself one of Wall Street’s smartest smart-money investors and one of corporate America’s most sought-after board members."

"Their emerging formula for success, regardless of the business, had a strong factor of hands-on management without a lot of intermediary layers. Their response time to operating problems was practically in- stantaneous—a Tisch trait that came through, sometimes annoyingly, even for top executives of companies whose shares the Tisches were only just beginning to accumulate. Years later, for example, for one full day in the late 1980s, the Tisches occupied the investor relations office of a New England bank whose shares they had been buying, and demanded answers to tough financial questions."

"The envelope was the beginning of a close friendship between the two soon-to-be giants of Wall Street who independently adopted strikingly similar investment principles around the same time: buy the shares of undervalued stocks with great long-term potential, con- tribute to strong management, and hold the stock indefinitely. They weren’t speculators—those supposedly savvy day traders who jump in and out of stocks at the expense of the market’s compulsive gamblers. Buffett and Tisch bought companies, not stocks. Culturally, they were vastly different. Buffett was an Omaha, Nebraska, Midwesterner; Tisch, the Brooklyn-born son of a Russian immigrant. But as investors they were nearly indistinguishable, moving down parallel paths to- ward major investments in the network television business."

"In fact, Tisch was running a network, but he was doing it by find- ing the right people and letting them do their jobs without second- guessing. That he was able to do so should come as no surprise. Throughout their careers, the Tisches let capable managers manage without hovering over them. They hovered only when things ap- peared to be going wrong, and they richly rewarded successful man- agers—not themselves. Sagansky, for example, was paid a total of $6.1 million in 1992, nearly four times Tisch’s compensation from CBS."

"The news had sent Salomon’s shares into a tailspin. Buffett s belief that the selling was overdone and that the firm’s ability to generate cash essentially was unchanged gave Tisch two powerfully compelling reasons to buy: ( 1 ) it was a deeply discounted, valuable asset, and (2) it might help a friend whose judgment had yielded Tisch millions of dollars."