Word: dunlap
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ALBERT J. DUNLAP Sunbeam chief gets dumped. Those who live by the chainsaw--RRRRREEEHMMM...
This is no ordinary builder. Dunlap adds by subtraction--and he will run these appliance makers through his corporate Cuisinart. Jobs will go; tears will flow. But that doesn't mean Dunlap's makeover is a farce. He has an ambitious growth strategy, which he appears determined to stick around to oversee. That's new stuff for Dunlap, 60, a churn-around pro who in the past has followed swift cost cuts with the well-timed sale of his company. The formula worked wonders for shareholders in 1994-95 at Scott Paper, where he cut the head count...
...smoke detectors and more. But for all the synergies, it is the potential for tried-and-true Dunlapian cost cutting that excites Wall Street. The biggest of his buys, Coleman, with '97 revenues of $1.2 billion, is roughly the same size as Sunbeam and has problems similar to those Dunlap faced at Sunbeam when he arrived in July 1996. Coleman essentially becomes Dunlap's next turnaround gig. Only he bought it instead of being hired. (Job hunting is such a drag.) If he can work his formula at Coleman, Sunbeam's stock will shoot much higher. With that in mind...
That is especially sweet music to Dunlap, who before signing those deals inked a more personal one that has already added a small fortune to the $100 million he made at Scott. Sunbeam gave Dunlap a new three-year contract granting him 300,000 shares and a staggering 3.75 million stock options--one of the 10 largest option grants ever, according to compensation experts SCA Consulting. That is on top of one he got in '96, a package now worth $130 million on paper. The new package, barely a month old, has already yielded Dunlap paper profits of $73 million...
...sure he's wrong. He may be Chainsaw Al to the tens of thousands he has fired. But that name doesn't fit for the even greater numbers who have prospered with him. I hereby dub thee Equity Al, money in the bank. Maybe that moniker, like Dunlap at Sunbeam, will stick around awhile...