The 1980s and 1990s were the Decades of Greed when saints and sinners caught the attention and imagination of the masses. Corporate superstars included Donald "Art of the Deal" Trump south of the border, and Conrad Black, who bought prestige newspapers in Britain and the United States before taking a huge gamble on The National Post in Canada.
Two business titans, born and raised in Sudbury, walked with the gods of wealth and prosperity at the end of the 20th century: real estate mogul Robert Campeau (1923-2017) and Paul Desmarais (1927-2013), the chair and CEO of Power Corporation.
In the 1980s, Campeau, who grew up poor in Chelmsford, had a mansion in Toronto, a house in Palm Beach, Florida, a hunting lodge in Quebec and an apartment in Manhattan. He had a private jet, a Rolls Royce and a mistress.
Chatelaine magazine declared him one of Canada’s 10 sexiest men in 1988.
He held lavish parties at the Metropolitan Museum of Art in New York City and at his Bridle Path home in Toronto. Peter C. Newman wrote in Maclean's about a party where Paul Anka made an appearance to serenade his egotistic host with "My Way."
The son of a mechanic, the real estate developer made headlines in the United States in 1986 when he paid $3.9 billion (US) for Allied Stores, which included upscale retailers Brooks Brothers, Ann Taylor and Bonwit Teller. Already heavily in debt, he borrowed $6.6 billion (US) to purchase Federated Department Stores, parent company of the luxury department store chain Bloomingdale's.
It is estimated his annual interest payments on the loans were $700 million (US).
Thousands of jobs were lost in the process of cutting costs. He was forced to sell a large portion of his company to the Reichmann family in 1989. The next year Federated and Allied filed for bankruptcy, and he had lost control of Campeau Corporation.
Campeau was vilified by the media. Facing numerous lawsuits, he fled to Europe.
Newman wrote in 1991, "Journalists and headline writers have seized on the Campeau story as a personification of the excesses of the 1980s. There’s no doubt that it was greed and striving for position that drove the Sudbury, Ont.-born entrepreneur to push his luck beyond acceptable limits."
According to numerous media reports, Campeau quit school in Grade 8 and lied about his age to take a job as a sweeper at Inco. He produced his dead brother’s baptismal papers as proof he was 16.
Fueled by ambition and the tools of the building trade, Campeau moved to the Ottawa area where there was great demand for housing following the Second World War.
After building his own home and selling it for a profit, he started building suburban bungalows and townhouses.
Political opponents suggested his relationships with Prime Minister Pierre Elliott Trudeau and other Liberals led to contracts to build and lease office complexes for the federal government.
More than half the office space in Campeau's Place de Ville development in Ottawa was occupied by government employees. In 1976, Campeau was chosen to build a government complex in Gatineau.
Campeau Corp. built large shopping centres across Canada including the expanded New Sudbury Centre in 1972, which was sold with other Campeau real estate to Cambridge Shopping Centres in 1991.
Campeau saw the potential of Toronto's industrial waterfront and built the Harbour Castle Hotel. A few blocks away, he built the 68-storey Scotia Plaza.
His fall was fast. After declaring bankruptcy following his attempts to dominate the American retail market, he moved to Austria.
Campeau had transferred some of his assets to his second wife, Ilse. When they divorced in 2004, an Ontario court ordered that she pay him $25,000 in monthly support and turn over $9 million in family assets. At the time of his death at the age of 93 in 2017, Campeau was living in a rented condo in Ottawa with his third wife.
While Campeau was considered the bad boy of Canadian business, Paul Desmarais, the son of a Sudbury lawyer, was considered the golden boy. He valued his privacy and was as reserved as Campeau was flamboyant.
"Desmarais moved up in Canada’s business hierarchy so quickly and so quietly that only a few top insiders heard his approaching footsteps," wrote Newman for Maclean's in 2013.
As chair and CEO of Montreal-based Power Corporation, he was considered one of the most influential men in Canada having gained the friendship of several prime ministers with generous campaign donations.
The Power Corp. empire included Great West Life, London Life and Canada Life in the insurance industry; the Investors Group and Putnam Investments; the Gesca newspaper chain, Montreal's La Presse; and stakes in the oil company Total S.A. and the Pernod Ricard liquor company.
Desmarais was one of the wealthiest people in Canada. In 2014, Forbes magazine estimated his family assets at US$5.1 billion.
After studying at the University of Ottawa, Desmarais dropped out of law school and returned to Sudbury to manage the streetcar business founded by his grandfather, Noël, for whom Noëlville is named.
"For a dollar, he bought Sudbury Bus Lines, a company that his parents owned and were about to sell. By taking control, he saved the jobs that the drivers and mechanics had thought they were about to lose. That earned him their loyalty and hard work as he tried to turn the company around." (The Globe and Mail Report on Business, Oct. 9, 2013)
Streetcars were replaced by buses, and Inco invested in the company to ensure its employees had transportation to the mines.
Desmarais married a Sudbury nurse, Jacqueline Maranger in 1953. The couple had four children. Sons Paul Jr. and André both have senior executive positions with Power Corp.
In 1959, the family moved to Ottawa when Desmarais purchased Gatineau Bus Lines and started to build his empire. In 1965, now a Montrealer, he bought Trans-Canada Corp Fund (TCCF) and gained control of La Presse, Montreal's French-language newspaper, as well as of radio station CKAC, and several daily and weekly newspapers as well as Imperial Life.
In 1968, Demarais took control of Power Corp. through TCCF and was chair and CEO until 1996 when his sons were appointed co-chief executive officers.
He remained chair of the executive committee of Power Corp. and used his influence on numerous corporate boards. He was a member of the Privy Council of Canada, awarded many honorary degrees and was a Companion of the Order of Canada.
Desmarais lived in a mansion on 21,000 acres of land located in the heart of Charlevoix, Que.
Stephen Harper, who was prime minister at the time of Desmarais's death, and former prime ministers, Jean Chretien and Brian Mulroney, delivered eulogies at his memorial, held Montreal’s Notre-Dame Basilica in 2013.
Former prime minister Paul Martin, future prime minister Justin Trudeau, Conrad Black, former Bombardier president Laurent Beaudoin, former Ontario premier Bob Rae, a former French president, and five Quebec premiers were among those who attended.
Desmarais brother, Jean Noël, a Sudbury doctor and a former chief of staff of Laurentian Hospital, was named to the Senate in 1993, two years before his death. Brother Louis was the Liberal MP for the Quebec riding Dollard from 1979 to 1984. Another brother Robert Desmarais of Sudbury was a provincial court judge.
The J.N. Desmarais Library at Laurentian University is named for Desmarais's father, Jean-Noël, who was one of the school's founders. The family donated $2 million toward the cost of the $13.5-million building. The family has given millions to hospitals and the arts in Montreal.
Paul Desmarais and Robert Campeau were not likely high school buddies, but they certainly knew each other and did business together. They had many of the same high-profile friends and both had homes in Palm Beach.
In need of money to expand, Campeau sold a majority share in his company in 1969 to Desmarais. He regretted the move and eventually borrowed $38 million to buy back control of his company at a premium price.*
In 1965, Power Corp. acquired control of Blue Bonnets Raceway in Montreal. In 1970, Campeau's company bought it. In 1991, a municipal government corporation acquired the horse-racing and casino facility now known as The Hippodrome de Montréal.
Son André Desmarais worked for Campeau prior to his financial meltdown in 1990. André became press secretary to Jean Chrétien when he was justice minister and he married the boss's daughter, France.
Vicki Gilhula is a freelance writer and former editor of Northern Life and Sudbury Living magazine. Then and Now is made possible by our Community Leaders Program.
Sources
- * Fortune Magazine, Aug. 15 1988, Kate Ballen, Campeau is on a shopper's high
- https://money.cnn.com/magazines/fortune/fortune_archive/1988/08/15/70896/index.htm
- Maclean's, Sept, 25 , 1989, Peter C. Newman, The spectacular fall of a titan
- Maclean's, Oct. 17, 2013, Peter C. Newman, The many bonfires of Paul Desmarais
- Globe and Mail, Dec. 3, 2013, Paul Desmarais’s funeral draws A-list of politics past and present
- New York Times, June 21 2017, Ian Austen, Robert Campeau, Flamboyant Canadian who owned Bloomingdale’s
