10 WHO MADE A DIFFERENCE:
John Adams
Stock buyback made him
hero to some and criminal
to othersSixth of ten parts
To some, John Adams is the white knight who saved Hawaiian Airlines, replaced its aging interisland fleet with sparkling new jets and vastly expanded its services outside Hawaii, giving some of the world's biggest airlines serious competition in the Hawaii market. To others he's an outsider from New York, a villain who milked the airline for his own enrichment and left it mired in bankruptcy after he siphoned off millions.
The latter view comes from a stock purchase plan he instigated last year in which he and thousands of others sold shares back to Hawaiian at a premium of more than 30 percent above market price.
Some fought controversial battles. Others made headlines or worked quietly behind the scenes. But all made an impact on Hawaii in 2003 and are thus recognized as the Star-Bulletin's 10 who made a difference.
Adams is the sole managing partner of AIP LLC, the partnership that owns the majority of Hawaiian's stock. His partnership received more than $17 million and remained in control, and Adams and other insiders were paid a total of $3 million in consulting fees.
Adams, whose New York-based Smith Management has a record of investing in businesses that are in trouble but have good potential for future profits, had his group buy into Hawaiian in late 1996, two years after it emerged from bankruptcy. It was his first airline investment, and he and his partners put in $20 million.
He has said that his investment has since grown to more than $50 million, and he was pained at suggestions that the stock deal was for his benefit. He says it was for all shareholders, who were holding undervalued shares and had not been getting any return.
Adams also can point to the positive side of his involvement. Hawaiian has completed the conversion of its interisland fleet to new fuel-efficient Boeing 717s. The airline itself, still reeling from the effects of the Sept. 11, 2001, terrorist attacks on airliners, filed for Chapter 11 reorganization in March of this year, but that was months after the stock buyback and was mostly related to lease terms for the new aircraft. It has reported operating profits every month since.
Adams was ousted by court order from the posts of chairman and CEO of Hawaiian Airlines, but he is still chairman and CEO of Hawaiian Holdings Inc., its parent company, which is not in bankruptcy.
Meanwhile, leases are being renegotiated, Hawaiian is moving toward getting out of bankruptcy once again and it is still flying 135 flights a day with its fleet of 13 Boeing 717s and 13 long-haul 767s and more than 3,200 employees.
