David Mahoney resigned today as chairman and chief executive of Norton Simon Inc. as the takeover battle for the conglomerate ended with its acquisition by Esmark Inc.
The resignation followed a tumultuous six-and-a-half week period which opened when Mahoney and a group of associates made an offer to buy Norton Simon's outstanding shares and take the company private. It was an effort that Mahoney never fully explained and one that was generally greeted with bemusement by the investment community.
Mahoney's $29.50-a-share leveraged buyout bid was just over the issue's trading price on June 6, when the offer was made, and was quickly followed by takeover bids by Esmark, Anderson Clayton & Co., and Kohlberg, Kravis, Roberts & Co. The bids steadily rose until, in effect, Esmark's offer of $35.50 a share was declared the winner.
"To facilitate the transfer of control to Esmark I am therefore resigning effective immediately," Mahoney said in a statement ending a 14-year tenure as the company's top executive.
Mahoney, who appeared in television commercials for Norton Simon's Avis subsidiary, has been highly visible in political and social circles both here and in Washington.
While analysts and other observers had difficulty with Mahoney's strategy, Esmark's motivations appeared clear-cut. Among Esmark's holdings are Swift & Co., which blends well with Norton Simon's Hunt-Wesson Foods business.
In addition, Esmark owns Playtex lingerie, while Norton Simon controls Max Factor cosmetics. Of Norton Simon holdings, only Avis, the rental car firm, would not seem to fit with Esmark's current positioning in consumer products.
Mahoney owns 718,513 shares of Norton Simon stock and could gain more than $25 million from the deal. He was paid $880,000 last year, with deferred payments likely to more than double that figure.
Spokesman for Mahoney, already a wealthy man, insisted throughout the takeover battle that his primary goal was to secure the best deal he could for company stockholders.