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       Dr. Grabow Pipes Forum Index -> History - Sparta, NC Pipe Factory
Spadefan

Why did UST sell Grabow to Lane?

Been reading about Grabow history and cant find why Grabow was sold to Lane.

Why did UST sell Grabow to Lane in 1992?

Was the Grabow business loosing money?
Was the Grabow business making money and Lane made an offer UST could not refuse?
Did the shrinking market and business size no longer fit the corporate model for UST?
???
ted

Re: Why did UST sell Grabow to Lane?

Spadefan wrote:
Been reading about Grabow history and cant find why Grabow was sold to Lane.

Why did UST sell Grabow to Lane in 1992?

Was the Grabow business loosing money?
Was the Grabow business making money and Lane made an offer UST could not refuse?
Did the shrinking market and business size no longer fit the corporate model for UST?
???


Please remind me again..... I have an epistle on that subject...  Just not today..td
Spadefan

I had asked a few questions of TED about the history of Grabow USTobacco and Lane.  We had corresponded a bit through private messages.  He wrote a history and has asked me to post it here.
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UST was really good at making Skoal, Copenhagen, and money. They had, over the years, owned and sold Cadillac Pet Food and Tuckersharp pens and pencils.

Except for an Executive VP at UST, Yannis Stephano, several other of their subsidiaries would have been sold. Yannis put together a Premium Products Group which consisted of House of Windsor Cigars in Yoe, PA, Don Tomas Cigars in Honduras, Private blended tobacco from Richmond, and Mastercraft.  Since Grabow and Mastercraft occupied the same building, Grabow was also safe from sale. I was still at Mastercraft.

At about the same time UST Marketing (They came up with the Skoal Bandit in NASCAR) brought some specialty woodworking to Grabow. It was several hundred Nestley store displays and Grabow did them and made money. John LaMonte was the President of UST Marketing and a Korean War buddy of Lou Bantle. Lou was President and Chairman of the Board of UST.  Lamont, with backing from Mr. Bantle insisted that Sparta start a custom woodworking shop. We did and put about 60 people and a BUNCH of money into a business that we called Spartacraft. LaMonte never brought us enough business to be profitable.

Premium Products fell apart when Yannis was promoted. At that point UST wanted to sell the subs that had made up Premium Products and did sell House of Windsor to two employees.. They were bankrupt within a year. Don Tomas and Private blended tobacco were sold or closed.
Mastercraft, since it was part of Grabow, was not sold.

By now I was Executive VP of the entire operation.. Grabow, Mastercraft, and Spartacraft. UST wanted me to buy the operations from them, but I could see the handwriting on the wall regarding smoking and also DID NOT want any part of Spartacraft. I actually offered them a fair price for the business, land and buildings, but it wasn't enough.

In 1989 Grabow and Mastercraft made $1,000,000 in profit (1/480th of UST's profit) and Spartacraft lost $141,000. In 90 Spartacraft lost over $800,000 and the pipe business had dropped to a break even. The pressure for me to buy the business increased daily, so finally after 20 years I resigned in January 1991.

UST sold (pretty well gave away) Spartacraft, and tried for a while to continue the pipe business. Pipe smoking and profits were way down so when Lane came along with an offer that was not much larger than mine, UST took it.

As far as my buying the pipe business... "Thank GOD for un-answered prayers".
UST wanted to retreat into their core business of smokeless tobacco and wine. I'm fairly certain that there had already been talks between UST and Phillip Morris about PM purchasing UST. That purchase happened a few years ago.

UST was a great employer. They had a stock option plan which I was involved in from 1976 till 1989.  UST stock had done exceptionally well so I was offering to buy the business with UST's own money.

Hope this isn't too convoluted. Kinda had to be there..  ted
*************************************************************

Thank you TED for another fascinating piece of Grabow history.
JoeMan

As always Tom...so interesting to read the historic details pertaining to Grabow, its ownership, people, products, and your involvement with it during your years there.  For your sake, I'm happy you did not buy it.  I think you'd have made a great owner, but the way things worked out, you were better off.  

Thanks for sharing, and thanks Gerald for posting.
Sean

Great topic! Thanks for telling it Tom. Very Happy This one should stay on top of the threads so it doesn't get lost in back pages. Maybe a sticky or sumthin'.
Oldredbeard

Sean wrote:
Great topic! Thanks for telling it Tom. Very Happy This one should stay on top of the threads so it doesn't get lost in back pages. Maybe a sticky or sumthin'.


+1

It always fascinates me to read how closely related so many different product names really were.

So that's what happened to House Of Windsor. I have wondered about that, and smoked several matches of their blends. Seems like they had some really good ones.

Thank you Tom, and Gerald.
ted

Oldredbeard wrote:
Sean wrote:
Great topic! Thanks for telling it Tom. Very Happy This one should stay on top of the threads so it doesn't get lost in back pages. Maybe a sticky or sumthin'.


+1

It always fascinates me to read how closely related so many different product names really were.

So that's what happened to House Of Windsor. I have wondered about that, and smoked several matches of their blends. Seems like they had some really good ones.

Thank you Tom, and Gerald.


Tim, I've lost track of HOW. The 2 guys involved were John Woltman and Ed Marino. Last I heard John was working for whoever ended up with the business.
Yes, Briggs, Union Leader, Barking Dog and several more..  td
Dan

A great bit of history there. Thanks.
Oldredbeard

ted wrote:
Oldredbeard wrote:
Sean wrote:
Great topic! Thanks for telling it Tom. Very Happy This one should stay on top of the threads so it doesn't get lost in back pages. Maybe a sticky or sumthin'.


+1

It always fascinates me to read how closely related so many different product names really were.

So that's what happened to House Of Windsor. I have wondered about that, and smoked several matches of their blends. Seems like they had some really good ones.

Thank you Tom, and Gerald.


Tim, I've lost track of HOW. The 2 guys involved were John Woltman and Ed Marino. Last I heard John was working for whoever ended up with the business.
Yes, Briggs, Union Leader, Barking Dog and several more..  td


I know P&C offers matches to some of their blends, the ones I've tried have been really good in their own right.
Troy_nov1965

Very interesting reading and history
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