Tag: James Welch

Changing of the family guard: At Brown-Forman’s annual meeting, the ordinary was actually extraordinary

By Jim Hopkins
Boulevard Publisher

George Garvin Brown IV, a great-great grandson of the young pharmaceuticals salesman who started Brown-Forman in 1870, stepped onto a dais at the whiskey giant’s annual stockholders meeting today, and told an amusing story about a subject that might otherwise have been deadly dull: brand loyalty.

Garvin Brown IV
Garvin Brown

It was 9:30 a.m., and several hundred stockholders had assembled in a conference room at the white-collanaded headquarters on Dixie Highway west of downtown. On a classically muggy Louisville summer morning, this was a dressy crowd. Many of the men wore dark suits, crisp white shirts, and boarding school repp ties. Women wore tailored dresses, or smart skirts paired with jackets, and an occasional pearl necklace. People were tan and slim and — in the case of the many Browns there — very, very rich.

This was a business event, but it felt as much like a family reunion, too — because, after all, a core group of Browns control the company through an equity stake worth well north of $6 billion. Garvin Brown, who is 47 and lives mostly in London, was running the meeting as chairman of the board. Seated nearby in Chippendale-style chairs facing the audience were the other 11 directors up for re-election.

This is the story Brown told. He was on a flight from London to Warsaw for a meeting with the Brown-Forman team responsible for the company’s growing business in Poland. Brown had lucked out, scoring one of his favorite seats — aisle, in a roomy exit row — with two empty ones between him and the window. Then a British man, one of the many harried road warriors aboard, arrived to take the window seat. He asked for a Jack Daniel’s, Brown-Forman’s most profitable brand, when the flight attendant rolled the snack cart down the aisle. Here, Brown’s ears perked up.

Jack Daniel's bottleBut the airline was all out. Would the Brit settle for another brand of whiskey, the attendant asked, perhaps a Johnnie Walker? Nope, he replied, and asked for a glass of champagne instead. As Brown pointed out to the audience, here was a man so loyal to Jack Daniel’s, he’d sooner drink airline champagne than just any other whiskey.

That’s how Brown eased the stockholders into a more formal presentation by CEO Paul Varga, who deployed many bar charts and fever graphs showing return on shareholder equity over one year, five years, and 20 years — important stuff, to be sure, but not quite as compelling as Brown’s literally on-the-fly market research.

By this point, Brown had already dispatched Continue reading “Changing of the family guard: At Brown-Forman’s annual meeting, the ordinary was actually extraordinary”

FAA drone rules buzz Amazon; KFC launches smartphone charging gadget, and McD paces Yum with $3B China bids

A news summary, focused on 10 big employers; updated 4:36 p.m.

AMAZON‘s plans to use drones for delivery were slowed yesterday when the Obama Administration released new rules limiting their use, including over urban areas. The Federal Aviation Administration said commercial drones are OK so long as the drone and its payload weigh less than 55 lbs., stays within unaided sight of their pilot, and operators pass a test every two years. In addition, each drone must have its own pilot (Guardian). Also yesterday, Amazon said it’s expanding grocery delivery service to Boston (Boston Inno). The retail giant employs 6,000 employees in the Louisville area, and thousands more across the state.

KFC: In India, the fast-chicken giant has introduced its latest mobile technology to lure younger diners: Watt a Box, a 5-in-1 meal box that comes with a Chicken Zinger, two hot wings, hash browns, a chocolate pie, Pepsi and a 6,100 mAh Lithium-ion battery to charge smartphones. The device isn’t sold, but instead can be won as part of a week-long competition; watch the demo video, above (The Memo). Some customers aren’t so thrilled, however: Testers who charged an iPhone with the box said it only gained 17% battery after charging for half-an-hour, during which time the powerbank became completely drained (Eater).

Meanwhile, in an unusually public spat with an employer, Darrell Hammond — the Saturday Night Live comedian hired to play Colonel Sanders in the new KFC commercials — says the company “played” him into thinking he’d have the gig permanently. He was later replaced by another SNL veteran, Norm Macdonald, in what’s now a running joke of actor switches (Hollywood Reporter). Indeed, it’s part of the script in comedian Jim Gaffigan’s version:

Here are spots by Hammond and MacDonald, who’s none-too-pleased with the switch, either.

YUM: As Yum gears up to spin off its China operations in October, rival McDonald’s has received more than half a dozen bids for its China and Hong Kong stores, including from Beijing Tourism Group, Sanpower and ChemChina, in an auction that could fetch up to $3 billion. In March, McDonalds said it was reorganising its Asian operations by bringing in partners who would own the restaurants within a franchise business (Reuters).

BROWN-FORMAN and other developers Continue reading “FAA drone rules buzz Amazon; KFC launches smartphone charging gadget, and McD paces Yum with $3B China bids”

New boomers on Brown-Forman board; Kindred’s got stock awards; big love for KFC’s threatened buffet, and big bucks for U of L’s Ramsey

A news summary, focused on big employers; updated 7:40 p.m.

Brown Forman board 2015
In this most current board photo, retiring directors are Martin Brown (fourth from left); James Welch (seated, eighth from left), and Sandra Frazier (seated, 11th from left).

BROWN-FORMAN shifted its 13-member board of directors, electing Campbell Brown, Marshall Farrer, and Laura Frazier, effective today. The company also announced a regular quarterly dividend, and a special two-for-one stock split for both voting Class A and non-voting Class B shares. The split shares are expected to be issued to stockholders of record around Aug. 8, and distributed about Aug. 18 (press release). This is the 12th split since shares were first listed in 1933 after Prohibition’s repeal; the most recent was a three-for-two in July 2012. (Dividend history.)

The three new directors are all fifth-generation descendants of George Garvin Brown, who founded the distiller in 1870. “This election continues a multi-year evolution of Brown family representation on the board,” the company said. “As part of this process, Martin S. Brown Jr.Sandra Frazier, and management director James Welch Jr. — who’s retiring as vice chairman on Tuesday — have elected not to stand for re-election at the annual stockholders’ meeting in July” (press release also includes bios of new directors). Brown-Forman said the directors’ decision to exit the board wasn’t due to a disagreement with the company (SEC filing).

Laura Frazier
Laura Frazier

The company didn’t disclose the new directors’ ages; those retiring are in their 40s and 50s. (Executive and board profiles.) Today’s moves were not unexpected; the Brown descendants effectively control the company through their ownership of more than 50% of the Class A voting stock, and have historically voted as a bloc (2015 proxy report). Of particular note, Laura Frazier is owner, chairman, and past-CEO of Bittners, the more than 160-year-old high-end interior design firm on East Main Street in NuLu. At the end of trading today, Class A shares closed at $104.21, down 25 cents.

KINDRED just filed a raft of documents disclosing stock awards to members of the board of directors (SEC filings; look for all Forms 4 on today’s date). Also, the hospital and nursing home giant disclosed the breakdown of yesterday’s shareholder vote tallies at the annual company meeting; no surprises (SEC filing). Yesterday, Kindred had only reported that stockholders approved the executive compensation plan, and re-elected the full slate of 11 directors to the governing board — but without providing details.

KFC Canada says a much-loved, one-of-only-two-left, all-you-can-eat buffet-style restaurant in Weyburn, Saskatchewan, won’t be shut down after all — yet, anyway. Residents had taken to social media this week when rumors circulated the buffet was a goner. A sit-in was planned for yesterday. Even high government officials got involved: Saskatchewan Premier Brad Wall took to Twitter (see below) on Tuesday, asking Yum to reconsider. The Weyburn KFC buffet was the first to open among the Canadian franchises in 1988; there’s now just one other left, in Saskatchewan’s Humbodlt (Global News).

Elsewhere in KFC land, actress Ann Hathaway jokingly compared comedian James Corden to a 16-piece you-know-what during a rap battle on The Late Late Show last night. “You look like a KFC bucket with a lot of extra breasts,” she said (Express).

UPS and its 2,500-member Independent Pilots Association union are making progress on bargaining a new contract (Courier-Journal). The pilots have been working under the terms of their previous contract for five years, and the union late last month set up a strike center here in Louisville.

GE: Qingdao Haier Co. has launched India’s first 44-lb. capacity washing machine. The Chinese company’s pending $5.4 billion purchase of Appliance Park is expected to close this summer (Newkerala and Courier-Journal).

James Ramsey

In other news, the University of Louisville Foundation paid President James Ramsey $2.8 million in 2014, according to its newly disclosed IRS tax return (WDRB). The return “appears to belie Ramsey’s claim last year that his compensation in 2013 was an anomaly” (Courier-Journal). The disclosure came one day after a published report that the foundation lagged many other Kentucky school foundations in annual investment performance.

Finally, Louisville Magazine has released the finalists in its annual Best of Louisville awards for businesses and individuals (Louisville).