On May 9, Edward E. Whitacre Jr. looked relaxed as he welcomed friends to his daughter’s wedding at the First Presbyterian Church.
Nothing in Whitacre’s demeanor provided a hint that the chairman of San Antonio-based SBC Communications Inc. was engineering the second-largest merger in corporate history, a $62 billion combination with Ameritech Corp. of Chicago.
“It was all pretty frantic,” Whitacre said in a brief interview last week. “I was trying to act nonchalant. You sure can’t tip off anybody that something’s going on.”
Those who know Whitacre weren’t surprised that he segued smoothly from an important family affair that Saturday to completing a huge business deal the next day.
Under Whitacre’s guidance, SBC (formerly Southwestern Bell) has grown from one of seven Baby Bells to the nation’s most admired telecommunications company, according to an annual Fortune magazine survey.
Whitacre reiterated that he wants SBC to be a global telecommunications player. Eventually, “there will probably be four of five of them, and we’d like to be one.”
Competitor Bernard Ebbers, chairman of Jackson, Miss.-based WorldCom Inc., has been a Whitacre critic, saying he doesn’t believe SBC’s claim that it welcomes competition in its local markets. But he acknowledged, “It’s a very, very well-run company. I’ll give him that.”
If the deal with Ameritech is approved by federal regulators, Whitacre will head the nation’s second-largest telecommunications company after AT&T; Corp., with an estimated $41 billion in revenue.
It’s all pretty heady stuff for a boy from Ennis, Texas, a small town south of Dallas, and for a guy who started stringing line for the telephone company while studying industrial engineering at Texas Tech University.
Despite his high-profile position today, Whitacre, 56, usually shuns the media spotlight and rarely grants interviews.
Interviews with a broad spectrum of people, including Whitacre’s friends and his critics, reveal an insight into a man who is bold, confident and shrewd, yet disarmingly frank and down-to-earth.
“Obviously, Whitacre is bold and decisive if you look at what’s happened to SBC,” said George Brandon, an editor at Telecommunications Reports Daily, a trade publication based in Washington.
Brandon and others praise Whitacre for knowing when to do deals and when to abandon them. SBC was the first Baby Bell to merge with another with the 1997 acquisition of San Francisco-based Pacific Telesis Group. Whitacre followed that up by striking a deal to buy Southern New England Telecommunications Corp. Yet he ditched a planned joint venture with Atlanta-based Cox Communications in cable television, and last year ended negotiations to merge with AT&T.;
The SBC chairman, who describes his job as “fun _ most days,” also is blessed with the common touch. Once after a business lunch of fancy French food, he confided to his lunch partner that he would have been just as happy with a bologna sandwich.
Whitacre’s mother, Lola, 90, said he calls her every day “just to talk and to check up on me.” She added that his high-powered corporate position doesn’t seem to have changed him. “He’s still the same guy.”
These days, that same guy is well compensated for the company’s performance. In 1997, Whitacre’s base pay was $975,000 and the board granted him a performance bonus of $3.3 million. Other compensation, including insurance premiums paid and awards of cash and stock that were granted him in prior years, topped $2.6 million.
Editor Brandon said Whitacre’s global vision doesn’t ignore people.
Whitacre has good relationships with some consumer activists and with the Communications Workers of America. The CWA represents 76,000 SBC workers now, a number that will swell to 106,000 if the Ameritech merger goes through.
Whitacre promised that workers would not be laid off following SBC’s acquisition of Pacific Telesis and the CWA said he has been a man of his word.
As a result, Whitacre was the first executive in almost four decades to be invited and to attend the union’s annual convention.
The invitation extended to Whitacre “is testimony to the good relationship we have” with SBC, said CWA spokeswoman Candice Johnson.
Whitacre said unions don’t scare him because “my dad was a union guy _ the railroad union. I grew up in a union town. They’re part of this company just like I am. They want the same things I want.”
Since being appointed SBC’s chief executive in 1990, Whitacre also put his mark on the company by making sometimes controversial moves, such as relocating SBC’s headquarters to San Antonio from St. Louis, its home for more than 100 years, and later completing a controversial investment in Telefonos de Mexico.
“The other day I took a look at the [SBC) stock trendline. It was straight up. And that trendline is Ed Whitacre,” said San Antonio banker Tom Frost, who recently retired from SBC’s board of directors. Whitacre also has won praise from community activists, a group not known for always being friendly to corporate chieftains.
Bob Gnaizda, general counsel for the Greenlining Institute in San Francisco, a group that works for social change, had seven meetings with Whitacre and came away impressed.
“He’s as extraordinary a leader as any we’ve ever seen,” said Gnaizda, comparing him to about 40 other corporate chieftains with whom the institute has met. That includes the chief executives of AT&T;, BankAmerica, NationsBank, Wells Fargo and Bank of Tokyo, he said.
“Some CEOs dodge questions, but he gave quick responses that were well thought out and to the point,” he said.
Following a meeting with the head of SBC, Gnaizda said “everybody said Whitacre is the kind of leader they’d like to have a relationship with, because he has the potential to make a major difference in California. But he has not yet chosen to do that.”
Whitacre also has been criticized for not nurturing innovators.
“SBC, by being narrow and focused, can react quickly _ but at the expense of innovation,” said Roger Wery, a San Francisco partner for Renaissance Worldwide, a consulting and technology firm.
Wery said Whitacre “has built a great team around him that is very cohesive _ it’s a fine-tuned machine.” Yet he said many of the forward-thinking executives at Pacific Telesis left following the merger with SBC.
Whitacre said such criticism is off-base. He pointed out that SBC was the first company to invest in an overseas telecommunications company, to buy another Baby Bell and to make a major investment in the cellular business.
“I think we’re pretty innovative,” he said.
