Mize's Many Empires

Texas empire builders like Ross Perot, James Ling and Haroldson L. Hunt have a penchant for headlines --but D. (for Davis) Doyle Mize does not. A self-effacing entrepreneur known by only a few in the upper echelons of business, Mize, 48, is chairman of Houston's Southdown, Inc. In three years under Mize, Southdown has acquired a cluster of companies that drill for oil, develop land, refine sugar, make cement and sell beer, pushing its sales up from $35 million to $182 million, with net profits of $38 million last year. Now Mize is spreading into the thriving California wine business.

Mize's method is to buy relatively small, family-owned, money-earning companies and then rapidly increase their profits by hiring new managers, paring payrolls and investing in modern machines and plants. His record of successes has brought him into the clubby inner circle of Houston's top businessmen and bankers, who lend him money to make deals. Speaking of his own wealth, Mize says, with some understatement: "I'm not big rich, but I'm damned comfortable."

Son of a poor Texas farmer, Mize dropped out of the University of Houston and went to work as a bench hand for an oil-exploration company. He moved up to become a salesman and then climbed through a succession of corporate jobs to become president of Mandrel Industries, an oilfield-equipment manufacturer. Naturally, he bought some stock in Mandrel and, when the company was sold in 1963, he had a bankroll of $250,000.

Itching to be on his own, Mize used his money, plus bank loans, to buy a controlling interest in Zapata, a small, cash-rich oil-drilling firm. Since he thus became the controlling stockholder in Zapata, Mize named himself chairman and began using the company's cash and stock to acquire other companies.

Great Thirst. By 1969, Mize had grown tired of Zapata, figuring that it had reached a point at which profits could not be raised fast. His goal is to double after-tax profits each year, which he has often managed to do. For a more promising base of operations, he chose land-rich Southdown, a company that Zapata controlled. In a complicated series of transactions, Mize made Southdown an entirely separate company, severing all its ties with Zapata. He also resigned from Zapata and named himself chairman of Southdown. Again Mize went back to making acquisitions, mostly in exchange for Southdown securities. He bought Southwestern Portland Cement and Pearl Brewing and formed Pelto Oil to expand Southdown's oil and gas activities in the oil and gas business.

Southdown also owns 10,000 acres of vineyards in California's Salinas Valley. Mize recently signed an agreement to exchange 1,050 acres of land for California's San Martin winery. Mize believes that in the next five or ten years, demand for California wines will increase rapidly because the French will be unable to produce enough to satisfy America's growing thirst for good but moderately priced wine. The domestic market will soon be big enough to support another major national brand, he says, and a hustling entrepreneur could become a kingpin in American wines. That is exactly what Doyle Mize would like to be.

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