If we look at sales figures which are in the public record, sales at Godfather's Pizza, adjusted for inflation dropped over 40% from the year before he took over to his final years. It is hard to imagine that profits went up at this time. Godfather's Pizza fell from the 5th largest Pizza chain when Cain took over to the 11th largest Pizza chain by the time he left the company 15 years later.
Cain bought Godfather's Pizza in a management leveraged buyout. In general, management leveraged buyouts are a device that company managers use to defraud stockholders of company profits. In this case, I believe the only reason there is no fraud in this case is because Cain was unable to produce any profits in the years he was CEO at Godfather's pizza. In other words, it was a fraud scheme that failed due to Cain's inept management.
Tuesday, October 11, 2011
The myth of Herman Cain
Jay Raskin points out that Herman Cain was a failure as the CEO of Godfather's Pizza: