Beating the Cycle

Sun-baked Sicily is a poor and promise-hungry land whose chief exports are citrus fruit and talent. Armed with native Sicilian shrewdness and the desire to get ahead, thousands of its sons have slipped into the mainstream of Italian business. Few of them have had more spectacular success than Milan Financier Michele Sindona, who founded and heads a corporate complex of manufacturing firms in nine countries and real estate firms in five. While many Italian businessmen are nervously retrenching in the face of rising costs and tightened credits, Sindona, 44, is moving ahead as if the economy were still at full pitch --and for him, it is.

Last week Sindona met with representatives of the U.S. General Foods Corp. to make plans for a joint venture in Sicily, did his homework for a similar planning session this week with Britain's Hambros Bank, and between times grabbed a telephone in his art-adorned office to hold Italian, French or limping English conversations with aides and agents on either side of the Atlantic. He has been on the telephone a lot lately. Last year he made news by swimming against the flood of U.S. acquisitions in Europe to buy, with two partners, a 20% controlling interest in Chicago's Libby, McNeill & Libby food-packing firm. Last month, in a second such venture, Sindona took control, by stock purchases and proxies, of New Hampshire's Brown Co., a paper and plywood maker that has suffered from industry slumps and takeover battles.

Reversing Trends. Sindona's penchant for joint ventures and foreign partners is the key to his good financial health. After he moved north from Sicily in 1947, he worked as a tax lawyer and accountant for such companies as Societa Generale Immobiliare and Snia Viscosa. In the process he noticed a simple but significant economic fact: while some countries were undergoing slumps, others were almost inevitably in a boom. Sindona reasoned that he could beat the economic cycle by founding firms in various countries, thus covering possible losses with almost certain profits elsewhere.

Organizing a Liechtenstein holding company called Fasco, A. G., Sindona used profits he had made in real estate to buy a small Italian construction company. He hired American technicians to run the firm, won contracts across Europe and the Middle East. Eventually he sold 60% of the company to Belgians and moved on to new ventures in Britain, France, Switzerland and the U.S.

Sindona, a soft-spoken executive who relaxes by reading Tolstoy and collects Renaissance art, runs such distant acquisitions through aides who have sweeping authority. He insists that his companies increase overseas activities to spread their own risk, points proudly to the fact that by so doing, Libby last year raised sales 5% to $289 million and tripled earnings.

Contact Man. Sindona is now president of seven companies, vice president of three and a director of twelve others. Along with protecting him against the winds of misfortune at home, his international complex has another purpose. Sindona is a dedicated free trader, believes businessmen can achieve tariff reductions faster than diplomats. "When enough European companies have interests in the U.S. and enough American companies have interests in firms in Europe," he says, "nobody will want to keep trade barriers up." To speed their fall, Sindona volunteers his services as a contact man and consultant without fee whenever he notices Italian and non-Italian companies that he feels should get together.

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