Quality on the Block

To Manhattan Real Estate Man Irving Maidman, Tiffany & Co. resembled a piece of valuable antique silver, badly in need of polishing. Sure that big profits awaited the polisher, Maidman began buying Tiffany stock early last year. By early 1955, claiming control of almost 10% of the company's 132,451 shares of stock, he asked Tiffany President Louis de B. Moore for a voice in management, demanded that the store catch up with "modern merchandising" (one of his suggestions: sell Tiffany's silver polish in chain stores).

Moore, who with the Tiffany family and others, claims control of 55,000 shares, turned down Maidman's demands and got ready for a proxy fight. But Maidman, who had bought some 13,000 shares for about $30 each, another 20,000 for $50 or higher, knew he already had a profit without fighting, shopped around for a buyer for his stock. Last week Arde Bulova's Bulova Watch Co. agreed to take over his holdings in a deal that will pay Maidman $60 a share or allow him to exchange the shares for Bulova stock. In any case, the deal will give Maidman a profit of more than half a million dollars.

By making the deal with Bulova, Maidman left Tiffany's facing a new question: will Bulova try for complete control? Said Bulova's Vice President Stanley Simon: "Obviously, if we bought some of the stock, we would be willing to buy more." Full control might be hard to come by, but Bulova was expected to try to get it by trading Bulova stock for Tiffany shares at a ratio that would give a Tiffany stockholder about $64 a share, almost equal to the book value of $65.

Tiffany's, founded in 1837 by Connecticut-born Charles Lewis Tiffany, has always served the rich and the successful, and always disdained flamboyance (from 1905 to 1935 it even refused to put its name over the door). It still uses hand-drawn advertisements, refuses to sell cultured pearls, shies away from setting or even appraising any gem not bought at Tiffany's. Its personnel seems changeless too. Out of 617 employees, 258 have been with the company more than 25 years, two of its officers are direct heirs of Founder Tiffany, and President Moore is a great-grandson of an early partner.

But the Tiffany heirs know that times have changed. The 20% excise tax on luxury goods hurt sales and profits, which were as high as $3 a share in the '20s, dropped to 11-c- a share in 1952. However, sales are on the upgrade again and during 1955's first six months, Moore reported a 25% gain over the same period a year ago.

Having lived through Maidman's foray, Moore and the other Tiffany heirs were breathing a bit easier last week. They seemed calmed by the knowledge that even if Bulova wins control it will have to keep Tiffany's tradition and tone. And as Bulova's Simon said: "We have no intention of displacing the management."

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