Richard A. Barone

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Richard A. Barone
RABPortrait2.jpg
Born Richard A. Barone
(1942-03-10) March 10, 1942 (age 72)
Cleveland, Ohio, U.S.
Nationality U.S. Citizen
Alma mater Georgetown University
Occupation Chairman of The Ancora Group, Investor
Signature Richardbarone-sig.png

Richard A. Barone (born March 10, 1942 in Cleveland, Ohio) is an American entrepreneur, investment advisor, and activist investor. He is the Chairman of The Ancora Group, an investment advisor which he founded in 2001; Chairman of the Arch Eagle Group, a broker-dealer providing services to investment professionals; and Chairman of Mace Security International, a personal security company and pepper spray manufacturer.

Early career[edit]

After working for a regional broker-dealer, Barone founded the Maxus Investment Group in 1973. Maxus became a leading regional investment advisor and mutual fund manager (The Maxus Funds) [1] with execution capability on the floor of the New York Stock Exchange. In 2001, Maxus was sold to Fifth Third Bank.[2]

During his early career, Barone, through Hedge Fund First Enterprise Group,[3] acquired significant positions in publicly traded companies such as Peek 'N Peak Recreation,[4] Diversified Industries[5] and Hampton Utility shares.[6] In April 1985, Barone made a tender offer for all shares of Peek 'N Peak.[7]

Career in the 1990s[edit]

In 1992, Maxus purchased Daley & Company, a small Cleveland discount investment firm from Wedbush Securities.[8] Several years later Maxus was able to expand assets under management with the purchase of Gelfand Partners.[9] The acquisition doubled the size of the assets under management and diversified the product offerings to include Fixed Income. The combined companies had over $2 billion in assets under management. Terrence Johnson, a writer for the Cleveland Plain Dealer, called Barone "a self-described dreamer that has single-handedly turned a three-man operation...into one of the biggest players in Cleveland's money management sector".[10]

In 1999, First Security Corporation purchased the Comstock Bank of Nevada.[11] Comstock was a state chartered FDIC bank, financed and controlled by Barone and investors.[12] At the closing of the transaction. Wells Fargo bid on and ultimately purchased First Security.[13]

Other notable acquisitions in the 1990s included positions in publicly traded companies such as Park Ohio,[14] Rockefeller Center Properties,[15] Scott's Liquid Gold,[16] Rocky Brands,[17][18] Olympic Steel,[19] and Bull & Bear Group,[20] a New York based money management firm. During the late 1990s the Maxus Investment Group purchased an ownership position in Donna Karan. In December 2000, Louis Vuitton had plans to purchase Donna Karan, at a price which Barone felt was low. The offer price was eventually raised by $22 million.[21][22][23]

Later career[edit]

In 2001, Barone sold the Maxus Investment Group to Fifth Third Bank. At the time Barone stated, "With what's going on in the industry today, we thought we needed to team up with a premier institution to be able to offer our clients a greater product line and services." [24]

With that sale, Fifth Third Bank decided that they were not interested in Daley Securities[citation needed] which Maxus had purchased in 1992. Barone purchased Daley back and converted its operation into a Friends and Family office. By 2005, Daley's business began to grow and with the return of several Maxus Investment Group executives, Daley became the nucleus for the formation of The Ancora Group Inc., an investment management firm which Barone currently chairs.[25]

Barone recently[when?] launched The Arch Eagle Group Inc., a provider of investment services to investment professionals such as hedge fund managers, investment advisors and other small broker-dealers. In 2011, he was elected Chairman of Mace Security International, a pepper spray products and personal protection company which he helped refinance.[26]

Investment philosophy[edit]

Barone's investment philosophy which has been developed over the last 45 years, is based on value investing. In the early 1970s, recalling several conversations with investor Warren Buffett, Barone concluded that several aspects of value are important to a transaction. According to Barone, these comprised branded products, pricing power, and free cash flow relative to market price. Investments in publicly traded corporations should only be made at corresponding values one would make if buying the whole company in a private transaction. According to Barone, volatility and uncertainty are good for creating investment opportunities, not a detriment. "When we see prices drop, that just means we're buying businesses at even less.".[27]

Barone's investment history has been written about in Barron's,[28] The Wall Street Transcript,[27] New York Times,[29] and Individual Investor.[30]

Boardships[edit]

In 2002, Barone joined the Board of the Cleveland State University Foundation. The Foundation works closely with Cleveland State's Office of University Advancement on fund raising projects.[31] In 2008, Barone became Chairman of the Cleveland State University Foundation.[32] In that same year, Barone became a community member of the Cleveland State University Board of Trustees.

In 2007, Barone was elected to the Board of Directors of The Stephan Company, a publicly traded manufacturer and distributor of haircare and skincare products.

In January 2008, Barone was elected to the Board of Directors of The Brentwood Foundation. The Brentwood Foundation, now part of the Cleveland Clinic Health Organization, was established in 1994 as a charitable trust dedicated to the promotion and advancement of medical education, clinical research, and community initiatives that impact health and wellness in the field of osteopathic medicine.[33]

In the Fall of 2008, Barone was elected to the Board of Directors for the Hospice of the Western Reserve.[34] He began serving his tenure in January, 2009. Prior to being elected to the Board of Directors, Barone provided both financial and investment consulting services to the organization, which provides hospice services throughout Northeast Ohio.

On March 31, 2009, Barone was elected to the Board of Directors of Mace Security International. Mace Security International is a publicly traded company which offers personal defense sprays, home and business surveillance and security, automotive security and child safety and security. Dennis Raefield, CEO and President of Mace, said "we are excited to have Mr. Barone as a member of the Mace Board as he was elected by a unanimous vote. Mace is currently executing an aggressive turnaround strategy and we welcome Mr. Barone's guidance during this time as we strive to increase sales." [35] In 2011, Barone was elected Chairman of the Board of Mace.

American Porcelain Museum[edit]

The William E. Telling Mansion.

On May 30, 2013, Barone was one of three parties to bid on the Telling Mansion, which currently houses the South Euclid-Lyndhurst Public Library. On May 30, 2013 the Library Board authorized the Library Director to enter into negotiations with Barone.[36] Barone indicated his intention to use the building to house his collection of American porcelain art and to build a collection of museum quality porcelains and reference material second to none. In addition, the Telling Mansion will serve as a Community Cultural Arts Center.[37] The Telling Mansion is an Ohio Landmark[38] and is on the National Register of Historic Places.[39]

Residence[edit]

He lives in Sarasota, Florida with additional residences in New York City and Cleveland, Ohio.

References[edit]

  1. ^ "Money Manager Interview," Wall Street Transcript, May 8, 2000
  2. ^ "Fifth Third Bank | Investor Relations | Mergers". Phx.corporate-ir.net. Retrieved 2013-09-12. 
  3. ^ "Miscues breed caution, First Enterprise invests carefully," by Lisa Gitlin, Crain's Cleveland Business, January 12, 1987
  4. ^ "Clevelander leads group bidding on Peek 'N Peak stock," by Delinda Karle, Cleveland Plain Dealer, April 24, 1985
  5. ^ "Group buys 5.4 Pct. Stake in Diversified," by Paul Wegman, St. Louis Post Dispatch, November 15, 1986
  6. ^ "Hampton Utilities Trust, Two Investment Firms Hold Stake Totaling 17.9%," News Alert, Wall Street Journal, June 26, 1990
  7. ^ http://books.google.com/books?id=9bUYpITTFdcC&pg=PA62&lpg=PA62&dq=Richard+A.+Barone+Peek+'n+Peak&source=bl&ots=wvRPBxR4hF&sig=0H8PujOv_0ynFtXxPrUso9X60r4&hl=en&sa=X&ei=J7dJUoinHPfe4APQ4ICACA&ved=0CCkQ6AEwAA#v=onepage&q=Richard%20A.%20Barone%20Peek%20'n%20Peak&f=false
  8. ^ "Maxus Acquires Daley Securities," written by Dan Shingler, Crain's Cleveland Business, January 2–8, 1995, Volume 16, No. 1
  9. ^ Kristen Baird (1997-04-07). "MAXUS PLANS MERGER DEAL WITH GELFAND". Crain's Cleveland Business. Retrieved 2013-09-12. 
  10. ^ "Maxus Founder is Building Diversified Success Quietly", written by Terrence L. Johnson, The Plain Dealer, March 10, 1996, Business Section
  11. ^ Published: January 14, 1999 (1999-01-14). "Company News; First Security To Swap Stock For Comstock Bancorp". New York Times. Retrieved 2013-09-12. 
  12. ^ "Local Investors Reap Rewards of Reno Gamble," by Christopher Serres, Crain's Cleveland Business, February 22, 1999
  13. ^ Nol, Michael (April 11, 2000). "Wells Fargo to Buy First Security for $2.9 Billion". Los Angeles Times. 
  14. ^ "Merger talk fuels Park-Ohio Stock," by Nancy M. Funk, Cleveland Plain Dealer, February 9, 1991
  15. ^ Pare, Terence P. (July 25, 1994). "LEARNING TO LIVE WITH DERIVATIVES They're here, they're weird, and they're not going away. Yes, these beasties bite, but companies that tame them have a competitive edge". CNN. 
  16. ^ http://www.sec.gov/Archives/edgar/data/88000/000116204412001012/ancorasc13d201210.htm
  17. ^ http://www.sec.gov/Archives/edgar/data/895456/000116204403000024/rocky13d13103.htm
  18. ^ http://www.sec.gov/Archives/edgar/data/895456/000075697601500133/rocky13d.txt
  19. ^ http://www.sec.gov/Archives/edgar/data/917470/000075697601500132/olympic.txt
  20. ^ "Maxus Founder is building diversified success quietly," by Terrence L. Johnson, Cleveland Plain Dealer, March 10, 1996
  21. ^ "LVMH's Offer for DKI Deemed on Low Side," by Lisa Marsh, The New York Post, December 20, 2000
  22. ^ "Donna Karan Settlement Approved". Los Angeles Times. September 11, 2002. 
  23. ^ http://www.theguardian.com/business/2001/jan/14/theobserver.observerbusiness6
  24. ^ Fifth Third Agrees to Buy Maxus Investment," by Mary Vanac, The Plain Dealer, October 4, 2000, Business Section
  25. ^ "Ancora Executive Committee | Ancora Advisors". Ancorat. 2013-08-21. Retrieved 2013-09-12. 
  26. ^ "Mace Security International names Barone chairman". 
  27. ^ a b "Money Manager Interview", The Wall Street Transcript, May 8, 2000
  28. ^ "2009's Big Winners See Slim Pickings Ahead", by Suzanne McGee, Barron's Magazine, October 12, 2009
  29. ^ "Riding Out Ugly Times, In Theory Any Way", by Virginia Munger Kahn, New York Times, June 8, 1997
  30. ^ "Maxus' Maxims", by Steven B. Kaufman, Individual Investor, September, 1995
  31. ^ "CSU Foundation". Cleveland State University. Retrieved 2013-09-12. 
  32. ^ "News". Cleveland State University. Retrieved 2013-09-12. 
  33. ^ "The Brentwood Foundation ~ About Us". The Brentwood Foundation. Retrieved 2013-09-12. 
  34. ^ Roger Mezger (2008-11-02). "On the Go". The Plain Dealer. Retrieved 2013-09-12. 
  35. ^ "Mace Security International Elects Richard A. Barone to Its Board of Directors," Business Wire Press Release, April 2, 2009
  36. ^ Pat Galbincea. "Richard Barone bids $755,000 for Telling Mansion, wants to turn library into American porcelain art museum (slideshow)". The Plain Dealer. Retrieved 2013-09-12. 
  37. ^ "Telling Mansion in South Euclid may become home to American Porcelain Museum". The Plain Dealer. 2013-05-30. Retrieved 2013-09-12. 
  38. ^ "Remarkable Ohio". Remarkable Ohio. 2007-04-16. Retrieved 2013-09-12. 
  39. ^ "National Register of Historic Places Database and Research Page". National Park Service. 2011-06-13. Retrieved 2013-09-12. 

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