Amfac's Wide Swing

"We're the least-managed company in the world. My colleagues have as much say as I do, and sometimes more. I make marvelous decisions that are promptly overridden by them, and they do it without bashfulness or shame, but with reason. Seventy-five percent of the time they are right. That's a high batting average, and it comes from having good people who are participating and having fun. As a result, we've got a hell-on-wheels management."

Stretching back in his neat office high above sun-sheened Honolulu Harbor, Henry Alexander Walker Jr., president of Amfac, Inc., a widely diversified service company, makes it clear that he and his brazen "no" men indeed have something special. As acquisitive as boys at a Good Humor truck, they have built the biggest and fastest growing Hawaii-based company. Amfac reaches into retailing, financing, farming and hotels, and is spreading into countries spanning almost half the globe. Last week Amfac expanded again, this time right into the populous East Coast. For $11 million in stock, the firm bought Baltimore's Hutzler Brothers, a department store chain that sells about $70 million a year worth of the best of everything.

This was the 42nd acquisition that Amfac has made in just four years, using securities or cash to expand from the middle of the Pacific basin to the West Coast, through the Southwest and to the Atlantic. Since Walker became chief in 1967, the company's revenues have almost quadrupled, to $578 million; they are expected to top the $1 billion mark by 1974. Last week Walker reported that profits in the past six months climbed another 28%, to $10.3 million.

Walker began expanding the company with an eye out for the consumer, reasoning that in the 1970s the "consumer is going to have more money and more leisure than ever before." He also realized that remaining isolated on Hawaii would limit the company's growth. In rapid succession, Amfac bought up the Fred Harvey hotels and restaurants and the eleven Hawaiian hotels operated by Island Holidays, including the Hanalei Plantation, where South Pacific was filmed. Already a retailer through its Liberty House department stores, Amfac absorbed other stores, including the high-fashion West Coast emporiums of Joseph Magnin and the venerable City of Paris store in San Francisco. With the five newly acquired Hutzler stores, Amfac will have 90 retail outlets by year's end. The company also raises sugar cane and cattle, processes frozen French fries, distributes electrical equipment and makes commercial and mortgage loans. In Hawaii, where land is practically as valuable as gold, Amfac owns or has long-term leases on 159,000 acres, worth hundreds of millions of dollars.

Now Walker is beginning another wide swing from the company's home base. This September he expects to sign leases to open three stores in Tokyo that will carry the Joseph Magnin name. With two local partners, the Daiei retailing chain and the C. Itoh trading company, Walker hopes to spread into other Japanese cities. He believes that Japanese young women want Western fashions and that "they have a tremendous amount of disposable income because they sensibly live at home when they start working instead of renting expensive apartments."

Amfac was not always a globetrotter. The company was formed in 1849 by a German sea captain, Heinrich Hackfeld, to sell parasols, silk waistcoats, bird cages and window glass to the Hawaiians. Later, changing its name to American Factors, Ltd., the company became one of Hawaii's celebrated "Big Five" factoring agencies that grew to power by handling financing, shipping, insurance and other services for the sugar plantations. Walker's father, whose own father had been Chancellor of the Exchequer under Hawaii's King Kalakaua, became president of the company in 1933 and ran it until 1950. But he never expanded beyond Hawaii.

Walker was named president in 1967 despite--not because of--the fact that he was the ex-chiefs son. The company frowns on nepotism, but Walker had proved himself a personable and smart executive who had a talent for enforcing tight financial controls. Now 50, he joined the company in 1947 after attending both Harvard and Columbia's School of Business. Walker, who is in his office by 7:30 a.m. and takes home only a half-hour's work, likes to operate his company informally; he even answers his own telephone. Twice a year he huddles with a dozen top officers at Silverado, a company-owned resort in California's Napa Valley, for a free-swinging critique of operations, a management device that Walker claims stimulates his executives.

For reshaping Amfac, Walker has been richly rewarded. Last year he was the highest-paid executive in Hawaii, collecting $174,000. Though he can afford better, he lives in a less than fashionable subdivision on the rainy windward side of Oahu, and has given up golf in favor of gardening and mowing his lawn with a small tractor. Explains Walker: "I crave solitude at times, and golf is a competition amongst men. I get enough of that in eight hours of work every day." But Walker may one day have to give up his enviably relaxed life-style on Hawaii. By the end of 1974, the company will consolidate several of its operations in San Francisco, a more logical center for Amfac's expanding empire.

This file is automatically generated by a robot program, so reader's discretion is required.