Jim Pattison, the Warren Buffett of B.C. - Macleans.ca

Jim Pattison, the Warren Buffett of B.C.

The octogenarian billionaire is still growing his Vancouver-based empire. His latest move takes him back to the business that started it all: selling cars.

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The Warren Buffett of B.C.

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Jim Pattison is not a man known for taking years to make a business decision. The head of the Jim Pattison Group, one of Canada’s largest private companies, didn’t build a sprawling $7-billion empire of grocery stores, magazine distributors, billboards and museums by making lengthy deliberations about his next move. But last month, more than 50 years after he opened his first car dealership in Vancouver, the 83-year-old billionaire finally decided to expand his auto business outside of British Columbia, buying a pair of dealerships in Winnipeg. Details of the purchase of Frontier Toyota, Frontier Subaru and a related autobody shop from the Thompson family weren’t made public, but auto industry insiders say the business likely went for between $5 million and $10 million and came with the condition that no employees be fired.

At 83, Pattison is long past the age when most CEOs would have retired for the golf course. As one of Canada’s richest men, with a personal fortune estimated by Forbes at $5.8 billion, he owns both a 150-foot yacht and Frank Sinatra’s Palm Springs estate. But friends and former colleagues say, if anything, Pattison is busier than ever these days running a company that has grown to more than 400 locations and 33,000 employees. “A lot of people talk about one foot in the grave. Jimmy will have both feet in the grave and he’ll still be looking for deals,” says Graeme Roberts, a long-time friend who served on the board of Pattison’s Air BC in the 1980s.

Pattison still travels regularly and is due in China this week for a business deal he won’t discuss. “If you like what you do, why change it?” he said in an interview. “I’ve been going to work for a long time now and I have no plans for changing that in the foreseeable future.”

Pattison is one of a dying breed of Canadian businessmen, a self-made man from humble beginnings, in this case in rural Saskatchewan and East Vancouver. There’s the mediocre school record—Pattison revealed a report card of mostly Bs and Cs during a visit to his East Vancouver high school last year—followed by a brief and unsuccessful stint in college. Then there’s the unflagging work ethic, from selling seeds, doughnuts and newspapers as a teenager to convincing a Royal Bank manager to loan him eight times the branch lending limit to open his first Pontiac dealership in 1961. “My objective in life was to make $25,000 a year. That was my whole goal,” Pattison says of his first year selling cars. He made $29,000 that year and was a millionaire before he turned 40, having purchased a radio station, an outdoor sign business and a chain of grocery stores.

Still, even as his empire grew he continued to run his business with the heart of a car dealer, keeping his headquarters humble with a small but loyal staff, and insisting it not bog down the company’s many divisional managers with layers of corporate bureaucracy.

Nick Geer, one of Pattison’s most senior executives in the ’80s and ’90s, recalls that in 20 years the headquarters grew from 22 people to 24. Pattison’s assistant, Maureen Chant, has been with him for more than 40 years. Call the company and ask for the operator, and it’s Chant who answers the phone. Pattison still drives himself to work and has been married to his wife, Mary, for more than 60 years. Even now he can’t resist the urge to check payphones for forgotten quarters.

The Pattison name is iconic in B.C., where it graces hospital wings and colleges and where Pattison has amassed tremendous power by expanding his company through the 1990s, even as corporations were fleeing the province’s stagnating economy. It was during that era that he started his personal investment firm, Great Pacific Capital Corp., and expanded into periodicals, creating the News Group, the largest magazine and book distributor on the continent. Pattison also owns Overwaitea Food Group, Western Canada’s biggest grocery chain.

Perhaps it’s because his businesses are so diverse (and spread from Edmundston, N.B., to Atlanta), or maybe it’s his steadfast determination to keep his corporate headquarters in B.C., but Pattison has escaped the kind of global attention befitting tycoons of his stature. “If he was living down in the United States, he would be of the same ilk as Warren Buffett,” says George Madden, former president of Pattison’s radio broadcasting division. “But because he’s here in Canada, and quite frankly because he’s here on the West Coast, I don’t think he’s probably seen at the same level.”

His success, former colleagues said, comes from finding businesses where he can have the greatest market share, and never making decisions based on emotions. To that end, Pattison says his purchase of the two Winnipeg car dealerships isn’t part of a grand expansion or an attempt to forge a national legacy in the auto business that gave him his first start. “It’s when the opportunities present themselves,” he says. “We had started with one dealership in B.C. and over the years we added to it and now the opportunity came up to buy two dealerships in Winnipeg and we took advantage of it.”

But dealers says the expansion of companies like the Jim Pattison Group across the country is inevitable. Changes to the industry have driven up the price of dealerships beyond what most small business owners can pay. Dealerships in major markets can sell for upwards of $15 million. It has meant a tremendous consolidation in the hands of big players, with the number of individual owners falling from about 3,600 companies 15 years ago to 1,800 today. “It’s really left the single-point dealer out of the game while the big groups continue to get bigger,” says John Carey, a Winnipeg Hyundai dealer and past president of the Manitoba Motor Dealers Association. Pattison sees it differently. “It’s actually much easier than when I started to borrow money from the banks,” he says. “It took me three months to borrow $40,000.”

Pattison may have no intention of slowing down, but there is much speculation about what will happen to the empire he built from scratch when he eventually retires. The only one of the three Pattison children to enter the family business is son Jim Jr. (He runs Ripley’s Believe It Or Not! out of Orlando, Fla. Ripley’s global network of “odditoriums” was a classic Pattison acquisition of the late ’80s: a virtual monopoly in the market for six-legged cows and shrunken heads.)

“Jim’s been very public about not necessarily wanting to have a family transition, so I’m not sure the expectation is there,” says Daniel Muzyka, dean of the University of British Columbia’s Sauder School of Business. Pattison is mum on the issue of succession. He has a board of directors made up mostly of executives based in Toronto and New York whom he consults yearly on his succession plans. “I’ve been doing that ever since many, many years ago, once I decided the company was going to survive,” he says.

One possible successor is Glen Clark, the former NDP premier whom Pattison hired a dozen years ago as Clark was facing criminal charges over allegations he had traded free home repairs for approving his neighbour’s casino application. Clark was exonerated and Pattison later made him company president. Pattison scooped up another high-profile public official in October when he hired Dave Cobb less than two years into Cobb’s stint as CEO of BC Hydro.

Whoever succeeds him, don’t expect Pattison to insist that future company leaders keep the business in B.C. “The world changes so quickly, if you try putting your feet in cement and you get asked to run, that’s effectively what would happen. He’s very realistic on that basis,” Geer says. “Jimmy is the driver of that company, is the essence and the glue that holds such a diverse group of businesses together. There will be somebody who will have different ideas that will evolve.”

Pattison himself is coy about what comes next. He has not built a personal empire by spilling too many corporate secrets. “British Columbia has been very, very good to me,” he says. “What happens in the future, nobody knows.”