Reconciling these adversarial styles was a monumental challenge for two men who had never been particularly close. At times they clashed emotionally over management strategy, at others they maintained whatever respectful distance they could in a company with thin walls and small corridors. One of the most difficult times came in 1980, when serious merger talks began with the William Underwood Co. Although it was never consummated, the proposed deal struck Joe as an excellent opportunity to put a price tag on the old family business; for JP, it was a troublesome expression of his son's independent bent and a lesson in the mortality of his own dream.
Then, too, there was the matter of those report cards.
The Aunt Millie's [Sauces Inc.] acquisition, in 1984, was a big deal for us, by far the most money we'd spent to pick up another company. Still, we'd analyzed the deal from every possible angle, and we knew we could fold their manufacturing operation into ours without a hitch. My father was dead set against it. He said we'd be spending millions of dollars on a leveraged buyout that could jeopardize the entire company and that he simply wouldn't allow it. Fine, I said, but I'm taking this to the board; we'll decide it there.
We had a real knock-down-drag-out fight about it. When the board approved the deal -- on a split vote -- he got really upset. I'm gonna write you a letter, he said, telling how you ruined this company. Four days later -- four days! -- I got a call from the same people who engineered the deal saying they had another offer and would guarantee us a $4-million profit if they could take Aunt Millie's back. Thanks just the same, I said, but let me tell you something, you just made my day. Then I walked into the chairman's office. Remember the letter you were going to write me about running the business? I said. Well, make sure when you get around to writing it that you mention a brand-new option: keeping Aunt Millie's, or putting four million bucks in the bank.
He never wrote the letter, and despite what he may think, I never considered "giving him a grade," either. I mean, what the hell do you give him on something like this? Zero for being a pain in the ass, or 100 for letting you do it in the first place?
(Joe II)
While father and son groped for a way to accommodate each other, their company faced a competitive future as far removed from the era of immigrant warfare as modern Lowell was from turn-of-the-century Mastretta. The basic product image had changed radically: mundane old macaroni was now superchic pasta. So had the stakes of the game. In 1966, Hershey Foods Corp. bought San Giorgio Macaroni Inc., a brand strong in the mid-Atlantic states; San Giorgio became the first of several companies Hershey ultimately would consolidate into a major pasta division. In 1976, C.F. Mueller Co., another independent player, slipped into the portfolio of Foremost-McKesson Inc. (now McKesson Corp.), which later turned the egg-noodle maker over (for about $124 million) to CPC International Inc. In 1977, Pillsbury Co. joined the party with a takeover of Kansas City, Kans.-based American Beauty Macaroni Co., then bowed out by selling American Beauty to Hershey's in 1984. In 1982, The Coca-Cola Co. purchased Memphis-based Ronco Corp. and its Creamettes label, planning, as so many others had and would, to take a pasta line national; failing in that, it sold Ronco to Borden Inc. in 1984. Perhaps most telling of all, Ronzoni Corp., the old Pellegrino nemesis, fell to General Foods Corp. in 1984, after a buyout offer from Prince that was, says Joe, "substantially -- and I mean substantially -- more than what they got." (Joe's sources told him the Ronzoni family spurned Prince for fear they'd never be welcome in Lowell, a concern he labeled" old wounds and complete b.s.")
By the mid-1980s, Prince was thus one of the last two major independents in a market dominated by large, multilayered conglomerates. Four of them alone claimed half the $10-million domestic retail market (Prince, number five on the list, had a 1985 market share of 7.5%), and all were food-oriented companies deep in managerial talent and capital resources for the long haul. To industry analysts, moreover, the "long haul" increasingly meant any and all attempts to roll out a national pasta brand, a strategy sound by traditional marketing standards yet deeply suspect on the basis of consumer -- and corporate -- history. Millions would be spent trying, and still the effort proved futile. One industry insider called it "the same old battle on a whole new level," a relic of the marketplace's past and a blueprint for its future.
VI THIRD GENERATION
The business never really interested me. Actually, if you want to know the truth, it bored me so much that I would get up and walk away from the dinner table whenever anyone started talking about it. I wasn't real close to my [paternal] grandparents growing up, either, so I never knew much about Prince's history.Besides, everyone just seemed to assume that my brother J. J. would be the one who'd go into the company and wind up running it, and that totally turned me off. So it really blew my father away when I got out of college and walked into his office and asked for a job. You're kidding, he says. Well, I guess I wasn't, 'cause here I am.
(Carla A. Pellegrino)
You know, I really admire what my father has done with this company. I give my grandfather a lot of credit for what he did, too, because he never had an education to speak of, and he ran Prince during a time when there weren't any large markets to capture. From what I know, he was a very dominant, street-smart type of guy -- I guess you could even call him ruthless -- who had to learn whatever managerial skills he had through real-life avenues. J just think Dad's done a fantastic job building on what his father gave him. He's more educated than my grandfather, more analytical, more able to deal with different levels of people -- just a more complete manager, I'd say. He and I started talking about my coming to work for him when I was a sophomore at Harvard. It's something we both look forward to; we have a real good relationship. And I feel like I'd be a fool not to take advantage of the opportunity to run my own company. My brother and sister? Hey, if they both want to work for Prince, I welcome their participation -- and the competition.
