Just Friends

Still more Bendix rumors

By most measurements, Bendix Chairman William Agee, 44, is the very model of a modern chief executive. During his four years at the helm, he has sold off less profitable operations, streamlined management and made several successful investments. More remarkably, Bendix has prospered despite the recession that afflicts two of its main businesses, automobile parts and machine tools. While competitors floundered in 1981, Bendix revenues for its fiscal year rose to $4.4 billion. Profits jumped 136% to $453 million.

Nonetheless, Agee has been bedeviled by unfavorable stories about his executive and personal behavior for 18 months. At one point, these even threatened to end his tenure at the head of the company.

Chief among the complaints are Agee's magisterial management style. He refused to make room on the Bendix board of directors for the man who preceded him as chairman, W. Michael Blumenthal, after Blumenthal resigned in 1979 as Carter's Treasury Secretary. Then when Blumenthal was named vice chairman of Burroughs Corp., another Detroit area company (1981 sales: $3.4 billion), Agee reportedly tried to get himself the job as head of the computer manufacturer. Agee also considered buying Burroughs outright. Along the way through those maneuvers, he forced three Bendix board members to resign because of their ties to Burroughs.

Bendix employees and outside analysts have been voicing their complaints. Says a longtime Bendix observer: "I don't believe that a fellow with his ego, his selfishness, his offensiveness, his personal ambition can last for a long time as head of one of our major corporations."

Some employees claim that Agee is beginning to turn Bendix away from its manufacturing functions into a financial holding company. Over the past year, Agee has accumulated $572 million in cash by selling off holdings. The money has been placed in high-interest deposits while Agee seeks to acquire a company in the high-technology field. In 1981 those cash holdings earned $65.6 million in interest, and this year they could yield as much as $74 million. Agee's critics charge that he should be paying closer attention to the company's existing operations rather than just sitting on the cash or dreaming about new technologies. Says former Director Robert W. Purcell: "I think there is a good deal of dissatisfaction within the ranks about Agee's leadership."

The most public of Agee's problems is his continuing relationship with Mary E. Cunningham, 30. She resigned from Bendix in October 1980, after stories began circulating about her romantic involvement with Agee. A 1979 graduate of the Harvard Business School, Cunningham had jumped from a relatively minor post to vice president in a little over a year. Agee, who had just been divorced from his wife of 23 years, strongly insisted to the board of directors at the time that there was no romance involved, and he publicly said that they were just "very close friends." Cunningham went on to become vice president of strategic planning and project development at Joseph E. Seagram & Sons, Inc., in New York City.

In recent months, though, Agee and Cunningham have become America's most visible corporate couple. They have been seen together from Paris to Tokyo. Last week they attended Super Bowl XVI in Pontiac wearing matching plaid outfits. A Detroit columnist has reported that they are house-hunting in a posh suburb. Since Bendix rented some new office space in Manhattan, Agee and Cunningham have been turning up in New York as well. Three weeks ago, they attended a charity function aboard the luxury liner Queen Elizabeth 2. Agee says that they are not married, but both say little else about their relationship.

Last week Agee faced Bendix shareholders at the annual meeting in the chrome-ceilinged auditorium of the company's Southfield, Mich., headquarters. Some industry observers had expected that Agee would be attacked from all sides, but the chairman breezed through the hourlong session, suffering only a few minor irritating heckles from stockholders. Despite all the stories about his private life, the firm's board of directors is pleased with the way Agee is running his business life. Last year it awarded him compensation that amounted to almost $1.8 million, more than double the $849,540 he earned in 1980. That makes him one of the highest paid executives in the U.S.

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