The Capitol Game

9

The fax arrived at 4:00 p.m. As death notices go, it was entirely lacking in warmth, detail, or civility. It read simply, “Notice effective upon receipt: For failure to perform, Globalbang hereby tenders cancellation of contract number UA124-990, said contract pertaining to all business arrangements between Globalbang and Arvan Chemicals. All future deliveries will be returned to sender, at sender’s cost.”

Perry’s secretary, Agnes Carruthers, took one long and horrified look and with a shaking hand yanked it out of the tray before scampering in the direction of the cramped conference room where Perry was in his weekly meeting with his section chiefs.

She banged the door open and stood, breathless and terrified.

Perry stopped in midsentence. “What is it, Agnes?”

“I…” It suddenly struck her that perhaps she shouldn’t mention this devastating news in front of everybody. Her face was ashen, her mouth hung open. It was just so horrible. Maybe it was a mistake-yes, that’s what it was, what it had to be. Or maybe somebody was playing a joke, a very rotten one. She clasped the paper to her chest and just stared at her boss, uncertain and speechless.

Perry stood and took a step in her direction. “Are you all right, Agnes?”

“Yes… uh, no,” she stammered. “You and Mr. Belton better join me in the hall.”

Agnes was old and occasionally excitable: she had been known over the years to throw the occasional outburst. Her tizzies were rare but legendary around the insular company. She looked positively unhinged, though. Mat Belton stood, and he and Perry followed her out into the hall. “You might want to shut the door,” she murmured quietly.

Mat did and the three of them ended up in a tight huddle. Agnes drew a heavy breath and tried to compose herself. “This just came in,” she whispered, unable to get the tremor out of her voice. She held up the fax so the terrible words could be seen.

Perry quickly read the paper. He yanked it from her hand then slowly reread it, searching line by line for a mistake or some clue that this was a joke, a forgery, a farce.

Nope: it looked dreadfully real. And quite final.

“Jesus” was all Mat could say. He repeated it, then again, and with each repetition the word grew weaker, becoming a faint whisper. If this was true, they were beyond even heavenly salvation. Mat knew what he was staring at, a certain sentence of bankruptcy.

“Failure to perform?” Perry slapped the fax in obvious disbelief. “Ridiculous. No, it’s completely outrageous.”

Mat insisted, “Our deliveries have always been on time. Always. Our reject rate is below a tenth of a percent. The past three years, they gave us the trophy for best supplier. This can’t be right.”

Perry and Mat fell silent and contemplated the ugly situation. Frankly, there was little to think about. Either they convinced Globalbang to rescind this hideous order or inside a week the banking vultures would be picking over Arvan’s corpse.

Perry lurched away in the direction of his office. After a moment, Agnes and Mat scampered behind him. Perry was already on the phone when they entered, seated behind his old, scarred desk, hollering into the mouthpiece at somebody to put him through to Timothy Dyson right away.

After suffering an interminable moment on hold, an assistant coldly informed him that Mr. Dyson wasn’t available at that moment, likely for weeks, maybe months, or possibly ever. At the very least, not until they stopped calling.

Perry slammed down the receiver, clasped his chest, and recoiled back into his chair.

“Are you okay?” Mat asked, moving quickly toward his boss, who appeared to be experiencing a heart attack.

“I think I’m going to be sick,” Perry moaned before he lurched over and hung his head over the trash can. “We’re ruined, Mat. Screwed,” he mumbled.

Mat so badly wanted to contradict his boss, to offer some reprieve, some way to calm him, anything to remove the pain.

But it was simply impossible.

Indeed, they were, without question, beyond doubt, totally screwed.

The call from Jack Wiley came out of the blue at nine the next morning. Agnes tried her best to ward him off, unloading an array of contrived excuses-Perry was feeling ill, indisposed in the bathroom, expecting a conference call that would last at least an hour, and every minute of every hour of the rest of the day was overbooked.

Truth was, Perry was hiding in his office, planted firmly behind his desk, aimlessly shuffling papers and avoiding his workers, still trying to come to grips with the disaster. He had arrived at work as always at six, left strict orders not to be disturbed, and hibernated in stony silence ever since.

Agnes quietly pried open the door and poked her head in. “It’s a Mr. Jack Wiley. He insists on talking with you.”

“I’m busy,” Perry replied. He shoved a few more papers from one place on his desk to another, anything but busy.

“He says you definitely want to talk with him, now. Says it’s very important, very urgent.”

“Don’t know him. Tell him to call back later.”

Agnes crossed her arms and studied her boss. He was in a deep funk, cranky and surly, trying stubbornly to ignore her. She wouldn’t budge, though. She’d never seen him this way, and was determined to make him snap out of it. His eyes glanced up occasionally. She crossed her arms and coughed a few times.

“Oh, all right,” Perry said in a reproachful tone, and lifted up the phone.

Jack quickly introduced himself. “You might not remember me, Mr. Arvan. I was seated in the back of the conference room when you briefed my partners at Cauldron a few months back.”

“I recall the meeting.” He paused very briefly. “But you’re right, I don’t remember you.”

“I thought you and I should get together. I have a business offer you’ll definitely want to hear.”

“I’m busy right now, Mr. Wiley.”

“Please, call me Jack. I’m nearby. An hour of your time is all I ask. Sixty minutes, and if you don’t find me interesting, you can leave at will.”

“Well… what time?”

“Noon. Lunch at the Princeton Inn, my treat.”

“Look, I-”

“And please bring your moneyman. Mat Belton, right? He’ll want to hear this offer, too.”

At noon, Perry and Mat entered the upstairs restaurant of the Princeton Inn amid a loud and rowdy crowd of locals, parents of university students, and Tiger alum, arriving early in a swirl of orange-and-black tones for the weekend game against dreaded Yale. Their mood was festive. Princeton was heavily favored by the Vegas crowd; the idea of putting it to the uppity Elis was almost intoxicating.

Perry and Mat, with their dour expressions, looked dreadfully out of place.

A cheerful young waitress awaited them at the entrance; they were promptly welcomed, then ushered straight into a small private dining room in the back. Perry and Mat had thrown blazers over their usual office apparel of tennis shirts and blue jeans. Jack, in a fine gray suit and stiffly starched shirt, was standing by a window, looking anything but casual, and gazing out at the usual midday bustle of Palmer Square. The second they entered he turned around and approached them.

Handshakes were cordially exchanged and a waiter appeared out of nowhere, hauling a tray with a scotch on the rocks for Jack, a cold beer for Mat, and a diet Pepsi for Perry.

“How did you know I like diet Pepsi?” Perry asked, narrowing his eyes, suddenly suspicious.

“A good guess,” Jack said, an obvious lie. “Incidentally, I preordered. You’re busy and I thought it would save time. Everybody okay with steaks?”

“Fine,” said Perry, and Mat nodded.

They sat around a small table, unfolding their napkins and studying their knives and forks. Jack barely waited until they were comfortable before he came to the point. He looked at Perry, who was sipping his Pepsi. “I hope this doesn’t sound presumptuous, but I want to buy your company.”

Perry choked so hard his face turned red. He pounded his chest and caught his breath. “What?”

Jack leaned back in his chair and crossed his legs. “That probably sounds a little abrupt, doesn’t it?”

“Abrupt… no, not at all. You got it right in your opening sentence-presumptuous. Who do you think you are?”

“All right, let me explain. Until a few days ago, I was a partner at Cauldron. Like a lot of financial guys, I’m bored with investing in others, tired of watching from the sidelines. I make plenty of money, but I produce nothing. I’m ready to run my own business.”

“Go on.”

“I’ve been searching for the right opportunity for about a year.”

“Have you now?” Perry asked, slightly amused.

“Yes, and after you briefed my partners, I became intrigued about Arvan Chemicals.”

“Glad you find us interesting.”

“So I did a little digging. You’re public, and it wasn’t hard. You have a fine company, Mr. Arvan, a very impressive outfit.”

“We’re quite proud of it.”

“And you’re in deep trouble.”

Perry and Mat exchanged looks. How much did he know? the looks said. Maybe nothing, maybe he was throwing darts in the dark.

Straining to look relaxed and unconcerned, Mat spoke first. “There have been a few minor setbacks. Nothing we can’t handle.”

Jack let that incredible statement rest unchallenged on the table for a moment that felt like an hour. The silence said everything-had he screamed “bullshit” it would’ve been less cruel, and less revealing.

He knew a lot.

Eventually, and in a matter-of-fact tone, Jack confirmed their worst fears. “Two years ago, your sales were four hundred million. Last year sales sank to two hundred. And unless my research is flawed, the military munitions market is even slower this year.” Jack’s eyes shifted to Mat’s face. “I assume that’s what you mean by minor setbacks.”

Trying hard to mask his surprise, Mat said, “Times are hard, Mr. Wiley. What’s new? Survival of the fittest, and we’ve been around forty-five years. Believe me, we’ll be standing when the dust settles.”

“Don’t view me as the enemy, Mat. I’m not.”

“Oh, you’re our friend?”

“No, but we’ll get there.”

“Don’t bet on it, pal.”

“Look, you have good people, great products, an admirable reputation. I’d like to keep it that way.”

“We’re not for sale,” Mat insisted, scowling and trying to stare Jack down.

Perry was casually nibbling a breadroll, allowing his younger, pushier CFO to carry the battle. But in fact he did not look like there was any fight left in him, hunched down in his chair, shoulders stooped, neck flaccid. He looked ancient, spent, and for a man who was inveterately neat, slightly unkempt: unshaven, hair unwashed with a large cowlick at the back, shirt hanging out of his pants.

Mat thought his boss had aged a dozen years in the past twelve hours.

But Perry ignored the bread for a moment and commented, “You know, running a company isn’t the same as investing in one.”

“Believe me,” Jack said, “I know that.”

“Takes strong people skills. Customer relations, management expertise, technical knowledge. How much you know about chemicals, son?”

With a timid smile, Jack replied, “I took a course in college.”

“And how’d you do?”

“I’m a fast study,” Jack said, ducking the question. It was an inane claim anyway, speaking as he was, to a man with a doctorate in thermochemistry. “Look, I’ve done or participated in over a dozen corporate turnarounds. I understand business, Mr. Arvan.”

“Good for you, Jack. We like to think we know a little about it, too. We’re not selling insurance or breakfast muffins, though. We deal with highly volatile chemicals. One small mistake and there’s a large crater in the middle of Trenton.”

“We can spend all day discussing my lack of qualifications. But why don’t we first focus on what I bring to the table?”

As if on cue, two waiters barged in and began laying down steaks. “Rare, right?” one asked Perry, who nodded vigorously. Evidently, Jack Wiley had done an impressive amount of research.

Perry grabbed his knife and fork, studied his plate a moment, then tore into his steak. “Go ahead with your pitch, I’m listening.” He hadn’t eaten since the night before and was famished.

“After fifteen years in investment banking, I can tap into plenty of deep pockets. Yours is a cyclical business, up one year, down the next. You need access to capital to get you past the rough patches.”

Perry stuffed a big piece of steak between his lips. No use denying it. “True enough,” he mumbled between bites. Well, what the hell, he was getting a free meal along with the lecture.

“Also I have an array of contacts.” Jack went on a bit, smoothly reeling off names of companies in the industry he was confident he could appeal to for business. He recited from memory. If nothing else, he exposed an impressive mastery of the automotive and munitions industries.

Perry ate and listened.

Mat fought an urge to stand up and walk out. He was sorely tempted to say, Do you really think we haven’t already banged on all those doors and begged every one of those companies for business? It’s not that easy Mr. Big Shot Wall Street guy with your soul-sucking job, looking for a new hobby. You’re an overconfident hustler. In fact, I’d love to give you the company for free just to watch you make a big belly flop. You’ll be broke and bankrupt inside a year, and I’ll laugh until my guts ache. He would have, too, at the top of his voice and with a blaring smile, except Perry placed a hand on his arm.

Jack finished up by saying, “If I might be so bold, I believe you’ve made a cardinal strategic blunder.”

Mat by now was irritated to the point of distraction. Mr. High and Mighty, who’d never sold a nut or a bolt, was about to explain where they had screwed up so horribly. He so badly wanted to take his fork and drive it into Wiley’s forehead. “And what would that be?” he asked, biting his lip.

“You’ve stayed independent too long, Mat. You need to partner up with somebody big who can open doors.”

Mat started to object before Perry said, “Might be you’re right about that, son.”

“I am, Mr. Arvan. I’ve participated in over a dozen turnarounds, mostly companies like yours, small, independent outfits being strangled by market forces beyond their control. It takes a powerful partner to avoid being pushed around.”

More looks shot between Mat and Perry. That phrase-“pushed around”-rattled around their brains. Why did he phrase it that way? Was he aware that Globalbang had just pulled the plug? How much did Wiley know? And the big question-where was this Wiley guy getting his information?

Mat scraped forward in his chair and leaned across the table. “Meaning what?” he asked, nearly a growl.

“Nothing specific, Mat. Align yourself with a powerful conglomerate and you’re feared. Might makes right in the modern marketplace.”

“It’s an interesting proposal, but I’m not interested,” Perry said, sounding very conclusive. He took another big bite of his steak. He chewed slowly for a moment, then put down his fork. “This is my company, Mr. Wiley. I built it, grew it, made it what it is today. I have no intention of giving it to some stranger.”

Jack did not flinch, or indeed show any reaction at all. “Sorry to hear that,” he said very slowly, very quietly. So far he had ignored his meal.

“Are you?” Mat observed. “Then why do I detect something else in your voice?”

“I am, Mat. Truly, I am very, very sorry. I was hoping we could do this friendly. Of course, I’m prepared to go the other way.”

“What other way?” Mat asked.

“I want your company. I’ll do whatever it takes to get it.”

“Why you dumb son of-”

“Easy, Mat, settle down,” Perry interrupted. He picked up his fork and resumed eating again. “What does that mean, Mr. Wiley?”

Jack crossed his arms and leaned backward. “For starters, I’ve contacted some of your largest investors.”

“Who? Parker? Longly? Malcome?”

“Them,” Jack replied, nodding, “and others.”

“Doesn’t worry me in the least. They’ve been with me a long time. They’re my friends. I trust ’em.”

“Two years ago, your shares were at $2.30. As of yesterday, they’re at sixty-five cents. You’ve lost these boys a lot of cash.”

“I know the share price, son.”

“And so do they.”

“And I’ve made ’em a ton of money in the past.”

“Ancient history. Parker’s down four million, and he’s the lucky one in the group.”

“Like I said, they’re my friends, Mr. Wiley. I was you, I wouldn’t count on ’em.”

Jack twisted the knife deeper. “And the banks?”

“What about ’em?”

“They your friends, too? Do you trust them?”

“I’ve always paid my way.”

Jack shook his head. “They’re sitting on a big pile of your debt. One hundred and fifty million, last time I checked.”

“They have nothing to fear,” Mat huffed. From his tone, he and Perry were ready and able to write them a check for 150 million on the spot. No problem: a quick scribble and dash, the whole problem would go away.

“They are afraid, Mat, very afraid. And they’re not your friends. In fact, they have hearts of ice,” Jack replied, frowning tightly. “The last thing they want is to own a bankrupt chemical company.”

“They won’t,” Mat insisted, straining and failing miserably to mask a growing dismay that Wiley seemed to know so much. Where was he getting all this information?

“You’re five million in the hole on interest this year,” Jack noted in a tone of absolute conviction.

Mat’s mouth nearly fell open. “How do you know that?” he finally blurted. More like 5.3 million to be exact, as if anyone cared.

“Doesn’t matter. Now listen closely, because here’s what does: If you’re overdue or short again, they’re going to foreclose.”

Perry’s face nearly went white. The fork slipped from his hand, and he slumped deeper into his chair and stared at the tablecloth.

And Mat was finally speechless. All his bluster and bravado had just had the floor pulled from underneath it. He had spent his entire career at Arvan, twenty-three years in which never once had he been forced to contend with the likes of a Jack Wiley. A medium-size factory in an unglamorous, blue-collar business, located in grungy, depressed Trenton, of all places, was so far off the screen that the buzzards in New York had ignored it. Oh, there’d been a few offers over the years, friendly tenders, all of them. Mostly amiable competitors anxious to grow a little the easy way, usually proposed as a merger in one form or another. A polite but firm “no thank you” and they went away.

This guy, though, just walked in out of the blue. No warning, no invitation, no sweet talk-just, Hello, I’m Jack, I’m here to rip out your guts and strangle you to death.

Mat was in the mood to fight, to tell this Wall Street pretty boy where to put his offer, but it was Perry’s company, and out of deference he bit his lip and kept his mouth shut. His boss should have the warm privilege of telling this guy where to shove his offer.

Perry drew a few deep breaths and tried to recover his composure. “So we’re clear, what are you proposing, Mr. Wiley?”

“It’s fairly straightforward. My people do a quick audit, assess your value, then we decide on a fair price. I’ll assume your debt, all of it. Paying it off will be my problem.”

“You make it sound so easy.”

“It’s even easier than that, and a very good deal for you. You’ll walk away with a mountain of cash. Buy a big boat, sail around the Caribbean for a year or two, and I’ll inherit all your problems.”

“What about my people?”

“I’ll keep as many as I can. That’s a promise.”

“What’s that mean?” demanded Mat, almost snarling.

“Some may not want to stay. I’ll offer three months’ severance to anybody who wants out.”

“So just voluntary departures?” Mat asked, spewing distrust all over the tablecloth.

“There may be a few others. I’ll try to keep as many as possible,” Jack said, and you could cut the vagueness with a knife.

Perry had returned to his eating. He was working his way through a large baked potato, slathered with butter, cutting and slicing with a vengeance. “And if I still say no?” he asked, concentrating on his potato.

“Then,” Jack said very solemnly, “you face two possible scenarios.”

“Please enlighten me,” Perry asked, shoveling a large bite of potato through his lips.

“One, a miracle happens, an avalanche of sales fall from the sky, you satisfy the banks, and I go away.” Jack conveyed this in the incredulous tone it deserved. Somehow he avoided a wicked smile, but it must’ve been killing him.

“What’s two?”

“The banks move in. They’ve been preparing this eventuality for weeks, Mr. Arvan. Their lawyers are ready to launch the necessary motions. Within hours, they’ll slap a lien on all your properties. You cosigned some of your corporate loans, so it’s not just your company, also your home and cars.”

Mat nearly fell out of his chair. Foreclosure! In all his dealings with the banks, they had given him no warning. No hints, no threats, nothing. He grabbed the edge of his seat and growled, “That’s hogwash, Wiley. As you said, they don’t want to own our company. They wouldn’t have a clue how to run it.”

“Glad you were paying attention, Mat. They don’t.”

“So what’s different now?”

“Now they have a buyer with deep pockets in the wings. That would be me, Mat. They’ll unload the company at a fire-sale price, and I’ll assume the debt.” Jack lifted his hands in the air and mentioned, rather casually, “Of course, it’ll take a little longer, I suppose. On the other hand, it’ll probably cost less.”

Perry put down his fork, his plate empty but for a few fatty scraps from the steak. “You think you got it all figured out, don’t you, boy?”

“I definitely do,” Jack said, pushing his plate away. His face suddenly turned cold, his tone almost scornful. “Now you figure it out, Mr. Arvan. I’m offering you the chance to make some money, a little nest egg you can pass on to your children. Or you can have your life’s work pulled out from beneath your feet and leave without a penny.”

“You’re a ruthless son of a bitch,” Mat spat.

Jack coolly withdrew two business cards from his pocket and flipped them on the table. He stood and, ignoring Mat Belton, looked Perry squarely in the eye. “Call me before the banks call you,” he said ominously.

Without another word, Jack walked out. He hadn’t touched his meal.

Perry pulled over his plate and dug in.