Showers Can't Quit: Wayne Homes

Dave Showers, former CEO of Akron, Ohio-based Wayne Homes, made headlines in April 1998 when he closed the sale of the scattered-lot home building pioneer to Centex. The deal caught most of the industry by surprise because few thought a Giant such as Centex would have any interest in an on-your-lot operation. "I was surprised, too," Showers acknowledges. But it certainly took care of his exit strategy and secured his personal wealth.

Here's the bigger surprise: Showers, now 57, who touted Wayne's freedom from land risk, is developing residential subdivisions and selling lots to builders in the Akron market with his son James, 31. So much for that end game. "I developed land on the side when I was with Wayne," he says of a strategy many builders employ to separate a few eggs from the corporate basket.

Another shocker: Until Tim Eller and Paul Leonard sweet-talked him into Centex, Showers was about to pull the trigger on the sale of Wayne to his employees in an ESOP. "We worked for two years on an exit strategy for me," Showers says. "We looked at going public and selling to the management team, but we decided on an ESOP until Tim Eller came around.

"I'm impressed with what Centex did with Wayne. They kept me around for two years and let me promote from within. Dave Logston is still running Wayne, and he's one of our guys. They've grown it from eight markets to 25."

Showers cautions that builders who are thinking about selling their company as an exit strategy should hire good representation for the bargaining table and be prepared for their rose-tinted glasses to shatter.

"Joe Palmer represented us, and he did a great job," Showers says. "We'd done an appraisal for the ESOP, but we had visions of larger numbers when we negotiated with Centex. Palmer brought us down to earth and forced us into a reality check.

"I think builders always see value in terms of future earnings potential, and that's not part of the real-world equation."