The Buffalo News from Buffalo, New York • 24

The Buffalo News Business inance Page 8 Sunday September 1 1985 'Unfair Trade' Has Area irm Crying the Blues By DAVID MONTGOMERY rise and fall with blue jeans" said William Canavan a man who much like fickle fashion trends The president and CEO of Buffa lo Color Corp the leading producer of indigo dye (the blue in blue jeans) said that right now fashion is on his side The strong dollar and US trade policies how ever are not acing stiff foreign competition and weathering a decline in sales over the last five years Buffalo Color Corp nevertheless is continu ing to redevelop its 80 acre complex in South Buffalo Showing off the new 23000 square foot office building on Lee Street Cana van said that he is confident about the future in Buffalo At the same time he added the condition of the indigo dye trade and the en tire textile industry is cause for a great deal of concern" Buffalo Color Corp was founded in 1977 when a group of investors based in New Jersey now called Hillside Capital bought the South Buffalo dye plant from Allied Chemical Corp Hillside still owns Buffalo Color keeping sales figures private The executive headquarters with fewer than 20 employees are in West Paterson NJ The firm employs more than 300 on the site in Buffalo spread out in buildings on Lee Street and South Park Ave nue along the Buffalo River Buffa lo Color is the only domestic manu facturer of indigo dye and its sole manufacturing facility is the larg est in the world Canavan said WHILE INDIGO dye has several uses and although Buffalo Color Corp does produce some other minor chemicals the firm is essen tially in business to make indigo for big textile customers said Kenneth McCourt vice president of market ing The customers like Cone Mills Corp and Burlington Industries Inc use the dye to color denim various shades of blue then sell it to designers like Levi Strauss Co and Blue Bell Inc McCourt said that the latest news from fashion oracles is good for Buffalo Color The rage today is Levi Strauss's shrink to fit he said This style happens to require heavy cotton fabric and a deep blue color both variables that increase the amount of indigo paste Buffalo Color ships each month A bad time Canavan recalls was when faded jeans were popular are affected by the fad swings and we basically have no control over Canavan said JtbuffalD COLOR CORPORATION The former president of the Olin Chemical Group who joined Buffalo Color as CEO in 1980 deplores the unexpected: good surprises are no good because surprises tell you that you really have con trol over the situation" But while trends in taste are hard to predict trends in foreign trade can do more damage Buffalo Color executives said IVE YEARS ago there was a sizeable quantity of indigo dyed denim exported from the US Canavan said Now the practically none is shipped overseas At the same time the import of finished jeans is way up The result is that the amount of indigo consumed in the US is falling guess basically a free Canavan said "I believe in free trade but I guess you have to add Canavan said that foreign textile merchants and his main indigo dye making competitors BAS in West Germany and ICI in England get subsidies and assistance from their governments The subsidies give them an edge what is sharp ened by the strong dollar think last a day in Washington" Canavan said first thing I would do is tell them what I think our government has handled this free tradefair trade situation very well" he added would suggest we elect some businessmen to Congress in stead of lawyers and politicians" The strength of the dollar and the tilting balance of trade have been term very costly for said Canavan who favors put ting reasonable on the growth of imported products To that end he said he supports the proposed Textile and Apparel Trade Enforcement act of 1985 which the House is expected to act on in the fan and the industry are willing to share in growth but I think we want to turn the market to countries enjoying subsidies and other advantages Canavan said Buffalo Color located along a poDuted section of the Buffalo River has sometimes been associ ated with reports of hazardous waste dumping and the subsequent efforts to clean up land waste sites and the river IN 1983 the state identified 37 hazardous waste sites in Western x1i Jy aS SS' (w VIkSSs sa fl ii i jSgaMMT I II Pl II fc h7A 1 I A wMf ter zn ir i 'svsA tesi Wearing blue jeans probably dyed with indigo from this plant Paul Mescall production engineer at Buffalo Color Corp watches the loading of an 1 1000 gallon tank car while Len Augustine a loader works on top of the car New York posing a threat to the public with three of then operated by Buffalo Color A 1984 study by state and federal environmental officials said that Buffalo color contributed mercury to the Buffalo River Buffalo Color officials deny that the firm has harmed the environ ment Canavan said the plant dis charges only cooling water into the river we discharge it at a higher quality "I think I could work in a place where I was knowingly endangering the said Leonard ranckowiak vice presi dent of operations Since Buffalo color took over the Allied Chemical site in 1977 there has been extensive redevelopment according to ranckowiak Buffalo Color has spent $4 million in demo lition costs to trim Allied Chemi 87 buildings to 35 buildings today including seven new struc tures More are planned ranck owiak said The brand new office building that recently was unveiled may be the only new office construction in South Buffalo since the 1970s said Buffalo Color executives Cost of construction was $16 million red Beaver an operator adjusts the caustic evaluation controls as indigo paste is produced at Buffalo Color Wfeteiffli Jpl iiHi tH If I (WHh i te wJ Hxh 'fl Ih 1 il Michel Bergerac: Revlon's Chief Executive ights Back By COTTEN TIMBERLAKE Associated Press NEW YORK Michel Berger latest challenge is to keep Rev lon Inc out of Pantry Pride hands certainly not the first for the rench born 53 year old chief exec utive who was handed the company a decade ago by its legendary founder the late Charles Revson Bergerac successfully diversified Revlon into health care and has be gun to turn around the beauty busi ness after some very bumpy years Adversity he says is good for the character It prevents you from getting complacent a fatal But Bergerac who also holds the titles of chairman and president too keen on talking about his own character The tall balding man who sports a moustache and speaks with a rench accent answers questions sometimes reluctantly sometimes evasively He is coolly polite said Roger Shelley a vice president of the company like to talk about himself" Bergerac is however more forthright about the unwanted Pan try Pride offer than are most bid fighting CEOs Pantry Pride which recently of fered $4750 per common share and $2667 per preferred share said it would have to raise about $650 mil lion of the $19 billion in cash through a public offering which is unusual It also said it would sell off parts of Revlon to help pay for the deal Bergerac calls the offer scan He says Pantry Pride wants to "destroy cheap what had taken gen erations to Pressed for his own management philosophy Bergerac who was bom in Biarritz said: one thing learned is stop using any pa tented recipes They usually He added: go through a thought process and you try to iden tify the problem You find a solu tion and you get it done And to do that you have to have good peo Bergerac presides over what sounds like a grueling monthly man agement meeting at which he and his staff sit at one side of the large table and the operating heads sit on the other one by one reporting on their units is fastidious in making sure that individuals who are supposed to do something do it He remem bers whatever he says If that prob lem still exists that person is most Shelley said The vice president added: has the ability to shout while keep ing his voice quiet He has the abili ty to get under defense mechanism and assault their con Revlon employees are motivated and work late hours at the boudoir like headquarters Shelley said The rench furnishings were American born choice he said What does Bergerac consider his greatest accomplishment at Rev lon? think we did a good job of diversifying the company into health he said Analysts agree Daniel Meade at the investment firm irst Boston Corp said think he has done a very good job in building a very substantial health care business really almost from the ground up and done it by buying companies at pretty reason able Over the years Bergerac presid ed over 11 significant acquisitions and last year health care business accounted for two thlrds of $298 million in operating profit and one half of its $24 billion in sales Ironically Bergerac is now going to sell $250 million worth of assets in health care a source said as part of his defense against Pantry Pride which is based in Lau derdale la Revlon also plans to buy up to 10 million or 26 percent of its own common shares for $5750 each in new securities Revson recruited Bergerac away from International Telephone See REVLON Page 14 Column 1 Owner of Proposed Channel 49 Plans Stock Offering essn THE AVERAGE Buffalo area factory worker earned $50520 a week in May according to the New York State Labor Department That was up $2963 from a year DONALDSON LUKIN Jen rette also has raised its rating for Quaker Oats Co parent of isher Price Toys in East Aurora shares as he recently told clients when the stock was sell ing at $55 a share view of positive earnings outlook and changing busi ness mix we continue to recom mend aggressive purchase for long term investors and accumula tion for those with short term hori he said Quaker recently reported earn ings of $376 a share for its June 30 fiscal year and analyst Edward A roelich thinks the company will earn $430 in the year ended next June or isher Price he says outlook for the current year is clouded by slower than normal ear ly orders by retailers for the 1985 Christmas company believes that these conditions will be met that the station will begin commercial broadcasting in the document said The stock offering is being man aged by a syndicate headed by Salo mon Brothers and Investment Corp of Virginia THE STOCK Arvin Indus tries parent of Calspan Corp Cheektowaga is recommended for purchase by Donaldson Lufkin Jenrette Securities Corp has made substantial earnings progress in recent analyst Richard A Henderson wrote in a recent report has also made significant progress in recent years in strengthening its financial he said He forecasts Arvin will earn $290 a share in 1985 and $345 a share in 1986 The company based in Colum bus Ind earned $249 last year Bank Name Change of the Week: Key Banks Inc the Albany holding company that operates several of fices in Western New York has be come Why did this happen? According to president Victor Riley Jr the new name will "better reflect the multi faceted financial services company that we are and will con tinue to be in the 2 Quote of the Week: Seen in Or chard Park on the back of a septic tank cleaning truck: "A Royal lush Beats A ull THE STOCK of Textron Inc par ent of Bell Aerospace Wheatfield continues to be recommended by EHutton analyst Laurence Baker continue to regard Textron ORMER BUALONIAN Ed ward A Brennan now president of Sears Roebuck Co Chicago ap pears in two full color pictures in the Sept 2 Business Week as part of RAGU GO GO: Since acquiring the Ragu spaghetti sauce company in Rochester back in 1969 Chese brough Ponds Inc says it has in creased annual sales from $22 mil lion to $300 million and calls the product first truly national spaghetti BETHLEHEM STEEL old Lackawanna plant will be the scene of a of machine tools material handling equipment sheet metal and fabrica tion machinery and steel mill during a three day auction starting at 10:30 am Sept 10 The inventory is open for inspec tion at Gate 1 on Sept 4 5 6 and 9 according to Industrial Plants Corp the New York City based auctioneer a story headed Sears tests its clout in credit Brennan ran Western New York operations from 1972 75 in a bigger league now and is head ing efforts to put its new credit card in competi tion with Visa Master Card Ameri can Express and Diners Club YES BETHLEHEM Steel chairman Donald Trautlein on the cover of the Aug 19 issue of Industry Week magazine the author of a story titled "Perils of Industrialization: Where Have All The actories A few sample quotes: present trends continue there will be a sig nificant change in America's whole economic system as basic manufac turing industries shrink or fade away and are replaced by fast food and trading steel industry is not standing still Our costs are down and our productivity is up and continuing to invest in new more efficient TVX Broadcast Group a Virgin ia Beach Va company that ex pects to open the new Channel 49 in Buffalo plans to sell 2 million shares of common stock to the pub lic at between $14 and $16 a share According to the prospectus TVX which had revenues of about $155 million in 1984 already owns UH stations in Virginia Beach Memphis Nashville and Win ston Salem NC Besides Buffalo the company plans future stations in Raleigh NC Little Rock Ark and San Antonio Texas Regarding Buffalo plans the prospectus says an 80 percent owned subsidiary last June to purchase the construction permit for WNYB TV Channel 49 Buffalo for approximately $670000 from a permit holder who had been unable to build the station The stockhold ers of the former permit holder own 20 percent of the stock of the subsid The document also says the transfer of the permit is still subject to ederal Communications Com mission approval extension of the construction permit and acquisition of a tower site By ROBERT SUMMERS 1 I I i.