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Yesterday, CFA Society North Carolina held a riveting fireside chat with Gene Hoots and Chris Pavese, CFA. They discussed the history and importance of tobacco in North Carolina, RJ Reynolds history, diversification program, as well as the leveraged buyout and aftermath.
In 2015, researchers at the London School of Economics reported that the most successful industry in America for the last one hundred fifteen years was tobacco. One dollar invested in tobacco stocks in 1900 would have grown to an astonishing $6.2 million in 2015. Gene Hoots worked for R. J. Reynolds for twenty-one years. He saw its empire grow and then destroyed by “Barbarians” in 1989 in the biggest leveraged buyout in history. But he knew there was a longer, dramatic story that both led to and followed the historic buyout.
Gene Hoots has worked more than fifty years in financial analysis and investments, including corporate acquisitions, running a major corporate benefits fund, and for the last thirty-one years at a private investment firm. He is a member of the CFA North Carolina Advisory Board and the Society of International Business Fellows. A native North Carolinian who was never able to stray too long or too far from his roots, he lives in Charlotte but travels to Montana, where he enjoys cattle drives and Rocky Mountain scenery, and to Europe, where he enjoys the architecture, the history, and far too much French and Italian food.
Gene’s book, Going Down Tobacco Road is a new look at how the ‘gold leaf’ became king in North Carolina and its impact on robber barons, factory workers, farmers, and almost everyone else in the state. But it is also the story of an Empire whose profitability from a controversial product brought untold riches to businesses, governments, and several million people and then caused its own destruction. The universal business lessons from this story about the rise, fall, and resurrection of an industrial giant apply to anyone who must allocate financial resources no matter whether for a personal savings plan or a major business enterprise.
Chris Pavese, CFA serves as President & Chief Investment Officer of Broyhill Asset Management. He leads the firm’s research and investment process, focused on idea generation, investment strategy, and portfolio construction. In addition to his role at BAM, Chris serves as Vice President & Chief Investment Officer of BMC Fund and the Broyhill Family Foundation.
Chris has over two decades of investing experience, beginning his career at JPMorgan where his work straddled JPMorgan Investment Management and JPMorgan Private Bank. In 2005, Chris joined the Broyhill Family with a focus on managing the family’s equity exposure. He was appointed CIO in 2011 and has held the primary responsibility for the family’s asset allocation since that time. In addition, he oversees the due diligence and ongoing surveillance of external managers, which represent a growing portion of the firm’s portfolios.
Chris received his bachelor’s degree in Finance from Penn State University. He is a CFA Charterholder, past President of the Board of the CFA Institute’s North Carolina Society and current member of the CFA North Carolina Society Strategic Advisory Board.
Chris Pavese, CFA | Anne Rogers