Moving Metal

publicly. Nor would the CEO’s condition be a selling point for potential investors. Crider, Hannah, and Hayes talked it through and the verdict was unanimous. As Hayes put it, “We had to make Joe the CEO of the company so that he could do these presentations around the country.” Neither Crider nor Hannah wanted to bear the bad news to Gimbel, so they nominated Hayes to do it. Hayes later admitted, “My whole shirt was wet with the thought of sitting in front of Bill and saying this to him.” When Hayes finally mustered the courage to tell him that it was time to go, Gimbel confounded him by looking up with his usual grin and replying, “Well, it’s about time. I was expecting you to come in and tell me that. How do we want to do it?” That was the end of the conversation. Gimbel resigned in May 1994, and the Directors elected Crider CEO in his place. The Board also agreed to issue $51.7 million in stock for public purchase. Crider and Hannah then went on the road that summer to sell it. Their sales “hook,” as Hayes designed it, was that Reliance was a wonderfully managed company in the vibrant western U.S. market that supplied “just in time” products to lots of small custom- ers through lots of transactions. It was an unusual business model but one that had worked for many years. Reliance was better capitalized and larger than its smaller, family-run com- petitors and it offered better service and delivery, as well as a wider variety of products. Reliance therefore was dependably profitable and its stock was a great investment. The hook set deep. Potential investors were intrigued by what Crider and Hannah were offering, and prospects looked good. It did not hurt when, in August, Reliance purchased certain assets of Affiliated Metals, which expanded the company’s footprint in the Salt Lake City area.

would be essential to structuring an initial public offering. But Reliance needed additional help as well, so Hannah turned to Doug Hayes, theWest Coast representative for the investment firm Donaldson, Lufkin & Jenrette (DLJ). Hayes had opened DLJ’s Los Angeles office in 1986, and had already talked with Reliance’s managing trio about conducting an IPO for one of Reliance’s subsidiaries. Hayes believed that a corporate IPO made sense, and soon he and Hannah were meeting regularly with Gimbel and Crider—sometimes together and sometimes alone—to determine what an IPO would mean for Reliance. Hayes later recalled that the conversations centered on such issues as “what they could expect, what was required, the kinds of things that public companies had to put in place to meet expectations, what the value of the company would be, how going public would affect the families’ shares, what the limitations were on owning or selling the family shares, and the likelihood of an unfriendly takeover.” Hayes had the answers to all of the questions, and Gimbel and Crider agreed that the time was right to go public. In the spring of 1994, Hayes and Hannah laid out their plans for the Reliance Board. The Directors approved. Yet one hurdle remained. Executives planning an IPO were obliged to undertake a “road show,” which meant traveling to give formal presentations of the Reliance portfolio and financial data to investors around the country within a very short period of time. Several presentations a day, often in different cities, were the norm. It was an exhausting duty even for those with the hardiest of constitutions, but it was unavoidable. Unfortunately, Bill Gimbel’s illness was reaching an advanced stage. Although his mind was still sharp, he was unable to sit up in a chair unassisted, much less travel or speak

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