Meet Liberty International's chief exec.

Posted On Monday, 17 March 2003 02:00 Published by
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Donald Gordan's new man is quietly building an empire, brick by brick.

When one thinks of the British shopping centres group Liberty International, one immediately thinks Donald Gordon, South Africas robust, takeno-prisoners entrepreneur who took the British retail property market by storm in 1980.

He created what is now the third-largest property holding group in that country and number 78 out of Britains top 100 listed companies.

So it comes as a surprise to meet his chief executive, David Fischel, 44, who was in South Africa this week to brief analysts and local shareholders on Liberty Internationals results for the past financial year.

If Gordon were looking for the perfect foil he couldnt have done better than this diffident, quietly spoken, dispassionate Englishman from west Sussex who graduated with a degree in classics from Oxford before training as an accountant with Deloitte & Touche, and whose cup of happiness runneth over when he's on a cricket field. (Under interrogation Fischel admits that yes, he did find time in his supposedly unsparing schedule to pop along to the Wanderers on Monday for the India-Sri Lanka World Cup match. No, he did not do the Mexican wave.)

If he's the perfect foil then Fischel is also the perfect counterweight to his swashbuckling chairman.

And one suspects that shareholders must be comforted by his undoubtedly steadying presence. One also suspects that nobody knows this better than the shrewd Gordon.

"I guess I'm calmer and more logical, more intellectual", says Fischel. "Donalds more of an ideas man".

"More instinctive? Yes. Our styles are different, but weve got along fine".

Given Gordons reputation in South Africa as a bit of megalomaniac, one can't help wondering if his mild-mannered chief executive was ever overawed by the larger-than-life Gordon or bulldozed into agreeing to things against his better judgment.

"When I started with the group at 27, I was young enough and rash enough and never frightened to speak my mind," responds Fischel.

"And Donald likes a good debate. He likes to put forward ideas and have them chewed over. Its not like he says, that is what were going to do, and expects everyone will just say yes and get on with it. Thats not how the company works at all".

Fischel believes that one of Gordons great strengths has been his refusal to surround himself with "yes" men.

He recognises the importance of having executives who will stand up and say so if they dont think an idea of his is right.

"He surrounds himself with people who don't always agree with him". Fischel implicitly deprecates any attempt to overstate Gordons solo role in the impressive growth of Liberty International.

This is not because he is meanspirited or tired of hearing the proposition that it took South African entrepreneurial genius and flair to drag Britain (where, he admits, the entrepreneur is a rare commodity) into the era of mega shopping centres and ignite its retail and commercial property market.

His hesitation to shine the limelight too sharply on Gordons smooth pate is almost certainly borne of an understanding of the harm that can befall a company whose success is too closely associated with a founding father, when that individual gets promoted to the great boardroom in the sky.

"Liberty International had two critical advantages from the word go", he says.

"It had access to vast amounts of capital from a single shareholder, courtesy of the Liberty Life insurance giant started by Gordon, of which it remained a subsidiary until 1999.

"And it had access to exceptional intellectual capital, thanks to the early acquisition of a British company called Capital & Counties.

"One of its attractions was that it was already in the shopping centre business in the UK", says Fischel.

"Capital & Counties had two large centres to its name, so the intellectual capital needed to build shopping centres, the infrastructure, was already there.

"With Liberty Life behind it, Liberty International got a big push. Instead of just being a small developer taking a share of developments and using its expertise, the company was able to become a major investor in centres.

"There was a huge advantage from Liberty Internationals view in being controlled for all those years by one shareholder, because we had that consistency, we didn't have to worry about being taken over. We could focus purely on shopping centres and build up our position

"What we've done would not have been possible if we'd not had that stable shareholding and consistent approach".

Gordons impact on Liberty Internationals performance was huge, admits Fischel. "His great skills lie in the financial aspects of what we do. He's a shrewd investor and he has a knack of knowing whats going to make money and what isn't. That's really been his input".

While acknowledging Gordon's achievement there are not many people who've created and been chairman of two multi-billion dollar enterprises in two different continents and in two different industries Fischel adds a rider, presumably for the benefit of his shareholders.

"Donalds been surrounded by a very stable team of executives throughout his working career. Maybe hes been very fortunate or very clever in that, I dont know".

It's clearly important to Fischel that Liberty Internationals success be seen as a team achievement. Gordon may go but the team will go on.

As will the growth in earnings, profits, dividends and assets, believes Fischel.

"Neither war in Iraq, terrorism, congestion in London or a likelyto-burst residential housing bubble gives him pause. Or, for that matter, a strong rand.

"The rand-hedge element will always be a major attraction for South African investors, who comprise nearly half the company's shareholders.

"When the rand is weak they want a rand hedge. When its strong they say it won't last".

If you want Fischel's take on the meaning of life and the source of happiness, look no further than the indices of Libints success which roll so readily off his tongue. And, of course, cricket.

"My enjoyment comes from steadily building the business. If you just, brick by brick, improve the business, producing growth in earnings and growth in dividends, in the end, if you just do that steadily and dont make too many mistakes, you end up as a good company".

And don't expect much help from Socrates or Plato. It might be faddish for business schools to get their students reading the Greek philosophers, but after four years of classics, Fischel has never quite understood why.

Maybe, despite appearances, hes a man after Donny's own heart after all.

Business Times

Publisher: Business Times
Source: Business Times

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