The Corporate C

The most engaging new celebrity in Washington last week was a 320-year-old boy dressed in a grey-brown tunic and a plumed velvet hat. In a chastely simple lobby of the National Gallery of Art, where the Mona Lisa hung last year on its visit to the U.S., Rembrandt's delicate 251 inch by 22 inch portrait of his son Titus was unveiled for a six-week-long stay before moving on to its permanent home in the new Los Angeles County Museum of Art. Art lovers flocked to see the study that Rembrandt lovingly painted shortly after the death of the child's mother, and the lines were lengthened by those who were as curious about the painting's price tag as about its ageless beauty. Two months ago, at a controversial auction at Christie's auction house in London (TIME, March 26), Titus was hammered down for $2,234,400, a record price for Britain and only $65,000 less than the historic price that New York's Metropolitan Museum paid four years ago for Rembrandt's Aristotle Contemplating the Bust of Homer.

Money & Desire. The man who bought Titus and brought it to the U.S., after a year of stalking it, is perhaps the only man in the world who could and would execute such a coup. As head of California's rapidly expanding Hunt Foods & Industries, Inc., Norton Winfred Simon is the ruler of a business complex that embraces two dozen companies in fields as diverse as publishing and steel. A comfortable millionaire--about $100 million at latest count--who grew rich primarily by canning tomato products, Simon in recent years has leaped from catsup to culture by assembling a $45 million assortment of art that ranks as one of the U.S.'s most impressive private collections. He is thus not only one of the few individual collectors with the money and desire for a first-class Rembrandt, but also that even rarer creature: a man who pursues great paintings and additional companies with equal vigor, thereby establishing a collector's reputation in both business and art.

In Washington last week, Simon was the guest of honor at a pre-unveiling luncheon (filet of sole espagnole) given by National Gallery Director John Walker and attended by such notables as Navy Secretary Paul Nitze, Dutch Ambassador Carl Schurmann, Pittsburgh Art Patron Paul Mellon and William Walton, chairman of the Federal Government's Commission of Fine Arts. Then Titus was ceremoniously brought from the gallery's basement, and while flashbulbs popped and TV cameras whirred, hung before red velvet in its place of honor. Yet, for all the trouble and cost he had incurred to acquire Titus, the lean, craggy six-footer with the deepset eyes and anguished look clearly did not savor the glare of publicity.

Simon is a cautious and secretive man who jealously guards his own privacy and, believing that he can function more effectively out of the public eye, has become known as a mysterious operator in both the business and art worlds. Such privacy, however, is increasingly hard for him to maintain. He has been deluged by a flood of requests and offers since the London sale of Titus, including thousands of pleas for handouts, dozens of propositions from art pushers, and an offer from an Englishwoman to sell him a 150-year-old pub. By dint of his business acumen, his acquisition of great art and his generosity in lending that art through the Norton Simon Foundation, he has become a national figure--whether he wanted to or not.

And an unlikely figure he is. A college dropout, he frequently talks like a tortured composite of Gertrude Stein, William Saroyan and Lord Keynes. "I am in the process of becoming," he says --period. He boasts, with absolute seriousness, that "I have a rigidity of flexibility." His view of life--and business--is more akin to Diogenes than to Donner: "I believe in a paradoxical form of life. I don't believe anything is wholly right, but both right and wrong. There is a thin line between. There is a Chi nese proverb that 'Life is a search for truth and there is no truth.' It is important to know that truth carried too far becomes destructive." How many businessmen talk like that?

Despite his enormous success, Simon is driven by a nagging sense of falling behind on things; a lover of conversation, he is frequently frustrated by his inability to articulate his thoughts. He lives modestly except for his art, will search the streets for a restaurant where he can eat for $5. Despite his brief and desultory academic background, he is a great backer of education and a regent at the University of California. Most of all, in the business life that has made possible all else that he has done, Simon is alternately a disrupting influence and a force for growth, a boardroom tyrant and a tolerant boss. Says Norman Cousins, editor of the Simon-owned Saturday Review: "There's no petty consistency to him."

Peerless & Flawed. Because nothing is simple about Simon, he himself is no longer quite sure whether he is an art connoisseur who engages in business or a businessman who collects art. He approaches both sides from a remarkably similar point of view. Just as he increases the value of a good painting by adding it to his collection, he claims that he also goes after control of new companies only for the purpose of improving them. The difference, of course, is that the art he acquires is peerless, while the companies are usually flawed. Simon sometimes takes years to decide on buying a work of art, investigating, studying, calling in experts to rule out frauds; in like fashion, he ponders and examines companies he wants long and carefully before moving to take over. He believes that it is wiser to make a major money outlay for one significant piece of art than to dribble funds away on the mediocre; he is also willing to lay out huge sums to get major corporations. Says Franklin Murphy, chancellor of the University of California at Los Angeles and Simon's closest friend: "Most business men tend to be rather traditional and representational in their approach to business. But I think of Norton as a Cezanne or a Picasso--unconventional, constantly probing and testing, constantly dissatisfied."

In two decades Simon has pushed his Fullerton, Calif., company to top place nationally in the sales of tomato products--catsup, sauce and paste. Hunt's 63 plants include the world's largest vegetable cannery, and the company processes an avalanche of tomatoes that rises to 20 million Ibs. a day in season. While raising Hunt's sales from $20 million two decades ago to today's $435 million, Simon has expanded in non-tomato areas with breath-taking scope. He has grafted onto Hunt the largest U.S. refiner of cottonseed oil (Wesson Oil), the second biggest matchmaker (Ohio Match), the West's biggest paint manufacturer (W. P. Fuller), and a big maker of cans, bottles and can-making machines (Glass Containers Corp.). Ranging far afield from food, he has won effective control of McCall Corp., which had $158 million in sales last year from McCall's magazine (circ.

8.5 million) and from commercial printing; and of Canada Dry, the nation's largest bottler of ginger ale and tonic water (1964 sales: $132 million).

Simon's taste in acquiring companies has become so catholic that many businessmen toss and turn at night wondering where he will strike next. He has become the largest stockholder in Swift & Co., the leading U.S. meat packer and, through McCall's and Hunt, has acquired more than 5% of the stock of American Broadcasting-Paramount Theaters, a larger hunk of the third-ranking network than anyone else holds.

In one of his bitterest battles, he recently took over West Virginia's Wheeling Steel, tossed out the chairman-president, and installed himself as chairman.

Crapshooting & Novels. Simon's acquisitive urge started unusually early.

The son of a modestly successful department-store owner who dabbled on the side in real estate and a steel products company in Portland, Ore., he inherited from his father a photographic memory and the ability to add or multiply multiple figures rapidly. He was an indifferent student who enjoyed history and arithmetic but disliked the rote of learning. He pointedly read novels during class.

At 14, the great upheaval of his early life occurred: his mother died and his father moved with him and two younger daughters to San Francisco to live with relatives. Norton enrolled in San Francisco's Lowell High, joined up with a group of boys who called themselves "The Nocturnes" and spent their spare time crapshooting. Another Nocturne was Edmund G. Brown, now Governor of California. "It was amazing," remembers Pat Brown, "how Norton could always figure out the odds. He might be playing against half a dozen others, but somehow he kept all the odds in his head."

Simon quickly expanded his money-making talents from dice. Working after school, he bought bags, towels and tissues from a paper manufacturer and sold them to San Francisco stores. At 16, in his most ambitious flyer, he put up money to lease a vaudeville theater, had broken even on the venture and was on his way to a profit when his father persuaded him to pull out of show business. He put his money in the stock market, gradually worked up from penny stocks to A.T. & T. He spent six weeks at the University of California at Berkeley before balking at teaching methods ("The university was involved with requirements, and I was interested in learning only what I wanted to learn"), then quit school and drove to Los Angeles to strike out on his own.

He developed such an effective system of hedges in playing the market that when the 1929 crash came a few months later he emerged with a kitty of $35,000 while more seasoned men went under. Simon was solvent in a promising buyer's market, and for $7,000 he bought a small, bankrupt Fullerton orange-juice plant. He renamed it Val Vita Products Inc., switched from bottles to cheaper cans, cut costs, undersold competitors and eventually switched the plant from orange juice to tomatoes. At that time, he was 25. In the next ten years, he raised Val Vita's sales from $43,000 to $9,000,000 a year.

"I'll Change Things." Before that, Simon had met a pert, Wellesley-trained social worker named Lucille Ellis at a Thanksgiving party, married her after a three-month courtship. "We danced a lot," says Lucille Simon of the courtship. "While he isn't that winning a dancer, his dialogue is great." For a honeymoon, Simon took his bride on a cruise through the Panama Canal, then went on a week's tour of East Coast steel mills to learn about the tin making that affected his tomato canning. One stop: at Wheeling Steel in West Virginia, where Simon informed Lucille: "Some day I'm going to be in the steel business." Said Lucille, whose sympathies were with the steel Industry's then embattled workers: "I hope you won't do that, because I could never eat bread from your table." Replied Simon: "Don't worry. I'll change things."

In 1943, Simon sold Val Vita, which made him a young millionaire, for $3,000,000 to neighboring Hunt Bros. Packing Co. Simon had been buying up Hunt stock for two years, and he now demanded a place on the board of directors; though he had about 25% of the stock, management refused and a series of battles followed. Simon succeeded in getting control of the company, changed its name to Hunt Foods. He bought a can-making plant, made himself unpopular with wholesale grocers by discontinuing, just when wartime shortages made it difficult to find new canners, Hunt's unprofitable practice of packing private-label brands. He also tripled advertising to an unheard of 7% of sales in an all-out effort to make Hunt a national brand.

Simon's advertising led to his first major acquisition. The Ohio Match Co., which was churning out millions of matchbooks with Hunt recipes on the cover, seemed to Simon worth more than its stock was selling at. He began buying in, got controlling interest in 1946 by snapping up a 20% block of Ohio stock that the bigger Diamond Match Co. had been forced to surrender by federal order. From matches Simon turned to railroads, using Ohio Match money to buy a substantial block of stock in the Northern Pacific Railway.

The more Simon looked into Northern Pacific the more its sloppy operating practices irritated him. He set out to win control, but was frustrated by a curious coincidence: the discovery of oil on Northern Pacific land in 1951.

Unable to buy more stock because of skyrocketing prices, Simon turned around and sold Ohio's share for a $2,800,000 profit. He put his oil profits into cottonseed oil, in 1946 acquired New Orleans' Wesson Oil for $76 mil lion. He quickly doubled its size, strengthened its marketing and distribution systems.

Looking around for new areas to enter, Simon noticed that many publishing stocks seemed to be undervalued because of the onslaught of TV and its potential threat to magazines. He bought up stock in several publishing companies, decided that McCall's offered him the best opportunity and continued buying until he had won control. He installed many of his own men, but their exhortations to improve the editorial product and sell more advertising bruised feelings at McCall's; Editor-Publisher Otis Wiese walked out, followed by most of the top editors. Simon then hired as editor Herbert Mayes, who had been fired a month earlier from Hearst's Good Housekeeping, promised not to interfere with editorial affairs. McCall's magazine has had the greatest intracompany growth (circulation has risen 60% since Simon took over) but most of the company's 550% profit rise since Simon took over has come from McCall's growing job-printing work.

The Real Raid. Simon is a constant and shrewd reader of profit and loss statements. He looks for companies with broad stock ownership, shares undervalued in relation to book values, sluggish management and sickly earnings. If he finds a likely case, he may dispatch aides to probe the situation deeper, use his contacts in Wall Street to find out why things are not better than they are. Eventually Simon may make a visit to the company himself--he took eight trips to West Virginia in the course of buying into Wheeling Steel--but his trips are mainly for general impressions rather than to learn exact detail of operations. When he has finally made up his mind about a company, the hot line to Sutro & Co. of Los Angeles, his primary broker, lights up and Simon begins to buy.

Simon has improved practically every company that he has gone into and, since he has never sold any of his major acquisitions, denies with some justice the common charge that he is a raider. Says he: "We wouldn't even come close to raiding, but this is used as a demagogic epithet by inadequate managements as their way of keeping their position. In a situation like Swift, which has leadership in the meat-and-carton industry and yet shows a consistently low return on investment, what has happened in the way of management over the past 30 or 40 years has been the raid." After moving in on a struggling company, Simon's first act is usually to cut back dividends to provide funds for revival--as he has done at Wheeling Steel.

Among the companies he has bought into lately, Canada Dry is the only one with which Simon feels he has reached a constructive agreement. Rebuffed at first, he was finally invited to become a director, now feels that "the dialogue has turned from negative to positive" and that Canada Dry is following his recommendation: spend more on advertising and promotion to grow faster. As for Swift, Simon says: "They should be making a lot more money, but they have a tendency to be conservators. They aren't aggressive enough in their operations or their merchandising. Still, I have no sense of urgency about Swift." That sense of urgency is reserved for Wheeling, Simon's only current losing proposition; there, with the aid of his personally picked new president, he will push $245 million worth of modernization plans.

Power Before Title. Simon's interests in the business world, and his increasing involvement in the world of art, have grown so demanding that he has been forced to abdicate the title, if not the power, of the top post at Hunt. Last year he stepped up from president of Hunt Foods to the $125,000 post of finance-committee chairman to allow himself more time for that most valuable of artistic attributes: perspective. "I've had to be a professional manager," says Simon, "and I haven't liked it particularly. It's been very rewarding and quite a lesson, and I'm damned glad to be rid of it. I like to work with things in a creative fashion, and that role is different from the professional manager's."

In his new role, Simon spends most of his time searching for companies with qualities that make them attractive to move into. He calls upon a topflight staff of experts to help him chart strategy. Among them is Stella Russell, a onetime Simon assistant who is now a director of Hunt, Wheeling and McCall's and who is known inside the company as "the translator" because of her facility for explaining to others what Simon is trying to say. The others: Hunt Vice Chairman Jack R.

Clumeck, Simon's itinerant board sitter and a funnel for the thousands of scouts and tipsters who now besiege Simon; Brokers Felix Juda of Sutro and Gustave Levy of Manhattan's Goldman Sachs & Co.; Graham Sterling, a Los Angeles lawyer and an expert on the intricacies of the Securities and Exchange Commission; and Hunt President Carl Kalbfleisch and Executive Vice President Harold M. Williams, who help Simon plan overall strategy.

Ulcers for 30 Years. Simon usually prefers power to title when he seeks to win a company, does not always insist even on board membership. "I prefer not being on the board of directors," he says, "if I can have a real and honest communication with the management. I don't think getting a seat on the board is tremendously significant, even in terms of getting information about what goes on inside a company. There's an awful lot of information that flows around Wall Street." When Simon is frustrated in his attempt to effect reforms, however, the qualities that have made him one of the most feared businessmen in the land quickly come to bear.

Behind closed doors--and occasionally in public--Simon can become pretty rough with the men who get in his way. He knocks heads together mercilessly, usually replaces the old team with his own men (he is an unabashed raider of other companies' personnel, has already hired away 15 executives for Wheeling from other steel companies), gets so impatient that he frequently pounds the table and yells. Says Jean Fowles, whose husband sold Manhattan's Duveen Gallery to Simon for $15 million last year: "The thing about Norton is that he's terribly impatient with stupidity. When someone insists that 'this is a good way because we've always done it this way,' he simply can't stand it." Simon's public attack on Wheeling Steel President William Steele ("Not even a good vice president") was unprecedented for its bitterness, has helped make the entire steel industry wary of Simon. Says Norman Cousins: "I've been telling him lately: 'Norton, remember, pay some heed to your image.' "

Simon finds that admonition difficult to heed, though he clearly broods over the hostility he brings out in others. "My hostilities are usually showing," he says, in the vein of introspection of which he is so fond. "But I do get rid of my anger very rapidly. Some people are born with peace of mind. I was not. In the Dostoevskian sense, I am the suffering man; I know this about myself. And I know now that working my way out of it is a very gratifying experience. I have gone through a process of reconciliation with myself. I had ulcers for perhaps 30 years and when they were operated on, I took an introspective look at myself. I don't like to be rough; it has even been difficult being firm with people. But I feel a very constructive part of being firm, I feel a constructive part of being rough. I feel a constructive part of letting my anger express itself."

Simon's friends are not necessarily surprised by the critics who accuse him of being harsh, stubborn and inconsistent. "I don't think he has a precise, eternal objective," says U.C.L.A.'s Murphy. "His objective changes. I think his fascination is with the process." As for Simon's wife, she seems to understand: "He may go to bed at night intending to fly to New York in the morning, but by morning he has changed his mind. He is extremely flexible, and I think it is because he is constantly in the process of becoming." People around Simon have a way of adopting his way of talking.

Compulsive Telephones The urgent, flexible world of Norton Simon revolves around a seven-day work week during which he spends some days in his study at home, others alone in an isolated office that he keeps on Los Angeles' Wilshire Boulevard, still others at an office in his Fullerton head quarters, a glass, stone and aluminum building designed for Hunt by Architect William Pereira. On weekends he and his wife frequently move north to a sprawling house by the Pacific Ocean at Lido Isle, and at least one week a month Simon travels to the East Coast to attend board meetings and see to new business.

Simon's workday is so individual and changeable that he has no routine in the usual sense. He rises between 6 and 7 a.m. in his house in the Hancock Park section of Los Angeles, begins the day's first round of telephone calls over a leisurely breakfast of tea, toast and fruit. For Simon, the telephone is a compulsive device: he has four unlisted telephones at home, three more in his blue-carpeted office at Fullerton.

When he arrives at his office in the morning he invariably demands, "What's new? What's new?", grabs up sheaves of telephone messages, then complains: "Is that all? Is that all?" In his office he swivels constantly like a metronome while he scribbles short answers to memos, receives visitors or pores over the pieces from newspapers and magazines that are clipped for him by Stella Russell, by his secretary, and by his Negro houseboy who, Simon insists, has a nose for news. Eternally restless, he constantly tweaks his ears, rubs his eyes, pulls at his neck, scratches his ankle, and chews constantly on a phenomenal number of Italian caramels that somehow do not seem to increase his steady weight of 180 Ibs. And, of course, he frets, worries and broods all the while.

Wherever he is, Simon tries to surround himself with art. His Fullerton office contains a Daumier bronze, Modigliani's Head of a Young Girl and etchings and lithographs of Rembrandt, Goya, Manet, Cezanne and Jacques Villon. He recently doubled the size of his home, an ordinary-looking stone and glass ranch on an ordinary street, to provide additional display space for his collection. (An elaborate alarm system protects the art, and Simon's household staff includes regular guards.) The collection includes Caravaggio, Degas, Giorgione, Renoir, Van Gogh and another Rembrandt, a portrait of Titus' nurse Hendrickje Stoeffels, valued at $1,500,000 (TIME color, June 5, '64). Simon started collecting in 1954 and his instinct for art, largely a self-acquired one, is sharp and sure. Says a close friend, Richard F. Brown, the director of the Los Angeles County Museum: "He won't buy unless the piece is of unquestionable authenticity and supreme quality. He's tough, he's smart and he has to know all the answers be fore he lays out a couple of hundred thousand."

As a private collector, Simon ranks with late Manhattan financier Chester Dale, whose superb collection of French impressionists and post-impressionists now belongs to the National Gallery. Unlike Dale, who gathered his paintings when their artists were unknown and prices were low, Simon's acquisitions have been expensive: his most recent, Degas' Repetition de Ballet, cost $410,000 at auction last month at New York's Parke-Bernet gallery. The Degas was for his own collection, but Simon is generous to the public. The earliest financial backer of the new Los An geles museum, he gave Brown a check for $1,000,000 to get it underway, now sits on the board of directors.

Opera & Canelloni. Simon's intellectual interests reach beyond art. He regularly attends board meetings at both the University of California and Oregon's small Reed College, where he became a trustee so that he could compare the problems of small and large schools. He gets much inspiration from his wife, an avid reader and intellectual in her own right, whom Norman Cousins describes as "a sort of Insiders' Newsletter from the world of culture." Simon reads constantly in corporate reports and art books, dislikes television and watches it infrequently despite his holdings at American Broadcasting. His favorite relaxation is swimming at least twice a day in his pool, which is so close to the Wilshire Country Club golf course that an occasional hooked ball plunks in. "Norton," says his wife, "is the only one I know who will swim around at night in the dark."

The Simons go out rarely, usually avoid the cocktail-party circuit. They enjoy visits from their two sons, Donald, 28, a University of Southern California graduate student, and Robert, 26, head of Hunt's vegetable procurement division, and their three grandchildren. They travel frequently, last week returned from a ten-day trip to Florence and Rome, where they soaked up art and opera and ate canelloni and Florentine steaks. At home, they prefer to entertain in small groups, mostly drawn from art and education circles, that make for lively conversation. Jean Fowles and her husband Edward at tended one meal, and Mrs. Fowles recalls: "They have all of the various Hunt products in different silver containers, and Norton said to Edward, 'Won't you have some catsup?' Edward said, 'Indeed not, I wouldn't spoil good food with that stuff.' Simon's wife laughed and said: That's why I've never learned to cook. Norton always pours catsup over everything.' " Later, Edward Fowles added: "But then, how would he have bought our Giorgione without the catsup?"

No Master Plan. Through his world of Van Goghs and vegetables, Simon, at 58, moves always with an "anything happen?" frenzy and a vigor that both irritates and impresses those around him. Even Aide Jack Clumeck says: "I cannot imagine spending seven days a week with this fellow. After a threeor four-day trip with him, I have to take a few days off. He is just that intense and probing." As a man of a reflective nature, however, Norton Simon knows that neither activity--nor acquisitiveness--are ends in themselves. "He is not interested in leaving a huge fortune," says U.C.L.A.'s Murphy. "He thinks each generation should take care of its own. He has extracted his wealth from society and he intends to give it back."

To give back his art, Simon has established his Norton Simon Foundation, which buys works of art and lends them out for public showings without charge. Some 25% of the exhibits in the Los Angeles County Museum are from the foundation, and the museum hopes eventually to get most of Simon's collection. As for that other collection, the string of companies that Simon has bought into, there is as yet no master plan. Simon says that an objective "is being worked out. It is going to be something complex. We are struggling with the definition." Translated, that means that Hunt is going to keep on growing, that Norton Simon will continue to cast his acquisitive eye on companies as well as on paintings--and that what comes of it all will be, in its own way, as rare and distinctive in the world of business as a Titus is in the world of art.

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