National Post (National Edition)
AN ENTREPRENEUR WITH A MIDAS TOUCH
Barrick Gold founder Peter Munk was one of Canada’s most high-flying, international deal makers, and one of its most generous benefactors.
On May 6, 2016, just three days after a wildfire engulfed Fort McMurray, Alta., and forced the evacuation of more than 80,000 people, business icon and philanthropist Peter Munk donated $1 million to the Red Cross to help displaced Alberta families.
Measured against all of Munk’s charitable donations — which have totalled more than $200 million — it was a small amount. But this gift was particularly poignant for Munk, because the spectre of families fleeing down the highway from Fort McMurray reminded him of his own flight from Nazicontrolled Europe.
“Watching the events unfold in northern Alberta reminded me of my own past as a refugee,” Munk said of his donation. “I know what it is like to lose everything.”
Munk died Wednesday, at the age of 90. An entrepreneur with a Midas touch, he was one of Canada’s most high-flying, international deal makers, with friends ranging from Brian Mulroney and Prince Charles to the arms dealer Adnan Khashoggi and French billionaire Bernard Arnault, as well as one its most generous benefactors.
He maintained homes in Paris and Switzerland, as well as three homes in Ontario and a 40-metre yacht.
The remarkable story of Munk’s escape from eastern Europe, while millions of his fellow Jews were killed, and his subsequent welcome by Canada shaped the corporate leader that he would become.
He was born in 1927 to a wealthy Jewish family in Budapest. In 1944, when he was 16, the German army occupied Hungary. In June, Munk crammed on to a train with his family and more than 1,500 Jews — their Nazi SS guards in a separate coach — and headed for Germany.
Such a trip could have easily turned into the end of Munk’s story; it was only the beginning.
Munk’s train did stop — for weeks — in BergenBelsen, one of Adolf Hitler’s concentration camps. Most trains to the camp brought Jews to be exterminated in the gas chambers.
But Munk’s train eventually moved on, with the Nazis sparing the families on board in exchange for vast sums paid by the U.S. Jewish community. The Munk family also gave the Nazis a safe stuffed with gold coins, bank notes, precious stones and gold-encrusted jewelry.
In August that year, the family made it to Switzerland, and safety. There, Munk’s story veers from sombre to silly. The teen attended high school, but he was a party animal. He also joined a group that traded rare stamps, nylon stockings and foreign currency.
“I made enough money of my own to pay for tea dances and entertain all the dates I wanted,” Munk told Richard Rohmer in the biography Golden Phoenix. “I went on long skiing holidays with friends up in the mountains.”
Finally, his father, Louis Munk, said to Peter, “This can’t go on. You’re going to dances instead of promoting your career.”
Peter Munk didn’t have the grades to attend a Swiss university. But his mother, Katharina, who had survived the Auschwitz camp and returned to Budapest, urged her son to head to the New World. Luckily, the boy had an uncle in Canada.
In 1948, Munk sailed from Liverpool to Halifax on the SS Ascania. He attended high school in Toronto to learn English, and won acceptance to engineering at the University of Toronto.
Even then, the young man’s propensity to party almost sank him. On a trip to New York, he blew the tuition money his uncle Nick had given him on a young woman.
Munk’s uncle said, “I can’t help you,” and chided him for his failure to follow such Munk family traits as hard work and discipline.
Munk found a job picking tobacco and earned his tuition. In university, he launched a business that brought in and sold Christmas trees — an odd enterprise for a Jewish kid. All went well until a freak snowstorm one winter left Munk with thousands of unsold trees. Still, the setback helped to shape him as a resilient entrepreneur.
Most remember Munk for the seminal companies he built and controlled, including Barrick Gold Corp. — the world’s largest gold producer — and the TrizecHahn Corp. real estate empire.
But his first big business break came in 1958 when he and a Toronto partner, David Gilmour, founded Clairtone, which built high-fidelity equipment in sleek, Scandinavian-style wood cabinets.
The brand, endorsed by Frank Sinatra, Hugh Hefner and Sean Connery and whose ads promoted the “brilliant engineer” Peter Munk, proved a roaring success in the 1960s.
The company made a misstep when it moved its manufacturing to a huge new factory in Nova Scotia, far from the company’s inventory and expertise, and bet heavily on colour televisions, which Canadians failed to buy.
In 1967, Munk and Gilmour lost control of Clairtone, which closed in 1971. The brutal loss did not slow Munk’s ambition.
“Clairtone was the single most formative experience in my life because it was so traumatic,” Munk later told the New York Times.
During the Clairtone years, Munk had two children, Anthony and Nina, by his first wife, Linda. Not long after Nina’s birth, the couple broke up, and Munk in 1972 married Melanie and had two more kids with her: Natalie and Cheyne.
Nina Munk recalls her childhood as peripatetic, marked by her father’s strict rules (he forbade her to wear makeup or nail polish), his generosity and her front-row seat to his endless travels and wheeling and dealing in Europe, North America and the South Pacific.
“The way we grew up, everything was always driven by whatever deal my father was working on,” she said. “We had to stop in the middle of a major family cruise through the Mediterranean. We’d be off the Turkish coast, and we would get grounded for hours because we were sitting by pay phones waiting for calls to come in.”
After Clairtone, Munk improbably set out to develop a resort in Fiji. But Bay Street mistrusted him. “When I went to Wood Gundy, the investment house, to raise the $4 million, they could hardly contain themselves laughing,” he once recalled.
Munk eventually raised the money, and his South Pacific Hotel Corp. became a huge success. Even so, “most of Bay Street treated me like a fugitive and a loser,” he told Peter Newman in the book Titans.
Munk persevered, and in 1983, though the Royal Bank of Canada and other banks still distrusted him, raised enough money to found Barrick Gold, which bought a struggling company with gold mines in Quebec and Nevada.
The Nevada mine turned out to house North America’s richest gold deposit; “the lucky break,” Newman writes, “which turned Munk into a financial powerhouse.”
In 1994, Munk wagered again, buying bankrupt Calgary-based Trizec Corp, which he renamed TrizecHahn. The company owned the CN Tower, but its jewel was Montreal’s Place Ville Marie, the crucifixform skyscraper.
Munk’s appraisal of Montreal as a place to invest in the 1990s, when the threat of Quebec secession was quite real, offers a glimpse of his bullishness — and joie de vivre.
“Montreal has a terrific location,” Munk told Newman. “Houses are cheap, the schools are fabulous, there’s great skiing, the girls are better looking, and there are great restaurants — all at a third of the cost of New York and half as expensive as Toronto. Why wouldn’t you go to Montreal? You’d have to be a nut not to.”
Munk sold TrizecHahn in 2006 for a tidy profit.
Newman summed up what drove Munk: “His motives aren’t as innocent or uncomplicated as making money. It’s restitution, redemption, revenge — the three great Rs in Peter Munk’s life.”
Luck visited Munk again during the saga of Bre-X Minerals Ltd. Barrick had a handshake deal to buy the apparently huge gold deposit in Indonesia. But the principals of Bre-X held off signing — they worried that Barrick’s due diligence would uncover that there was no gold.
In 1996, Bre-X was exposed as a fraud before Barrick spent any money on the property.
“The moment it was announced as a fraud, I went from a deep depression and a psychosomatically induced flu to health in 15 minutes,” Munk said.
Barrick, though generally a success, didn’t escape bad news all the time. Its stock cratered to $8.50 by 2015 from $54 in 2011 as gold slid in value. Shareholders punished the company, twice voting against the board of directors’ pay plans for senior executives.
Munk in 2013 blamed the stock slide on a “perfect storm” and stepped down as chairman of Barrick later that year. The stock has since recovered to about $21.
Barrick has also weathered criticism for its environmental record and from human rights groups for its treatment of some workers overseas.
Even as he endured some challenges at Barrick, Munk, at the tender age of 80, began his last big business deal when he and investors bought a decommissioned Soviet naval base in Montenegro.
The Arsenal was an abandoned wasteland littered with unexploded munitions, 64 rusted ships and disused submarines. Munk, though, could squint and imagine the largest superyacht marina on the Mediterranean.
“You only come up with a hare-brained scheme like that at age 80 if you just love, love, love starting businesses,” his daughter Nina said.
Last year, Munk sold Porto Montenegro — at a profit — to the Investment Corp. of Dubai.
Today, the Munk name lives on in the Peter and Melanie Munk Cardiac Centre at Toronto General Hospital, the Munk School of Global Affairs at the University of Toronto, and the semi-annual Munk debates, which have featured Henry Kissinger, Christopher Hitchens and Tony Blair.
Munk said his biggest gifts will come after his death, and Nina believes her father’s biggest legacy will be his philanthropy.
Munk is survived by his wife, Melanie, five children and 14 grandchildren.
PETER ACQUIRED A DEEP AND ABIDING LOVE FOR HIS ADOPTED COUNTRY, AND ALWAYS CREDITED THIS NATION FOR HIS SUCCESS. BUT PETER REPAID HIS BELOVED CANADA MANY TIMES OVER WITH HIS REMARKABLE SUCCESS IN BUSINESS. — BRIAN MULRONEY People, and especially the ladies in our lives, were always amazed at our telephone conversations which were always punctuated with phrases such as, ‘but my love’ and ‘darling, don’t you understand?’ We had the most extraordinary relationship. — Clairtone Co-founder david Gilmour After university he arranged for me to work at a company where I could gain some experience. When I was ready, he brought me to Barrick. He said to me, ‘Sink or swim — it’s up to you now.’ It was the most generous thing he could have done: give me the autonomy to claim my abilities for myself. — barriCK Gold Chief of staff Kathy siPos