Postby healey36 » Fri May 26, 2017 10:20 am
Howard was long gone by the time I joined Hughes, shortly after GM acquired it for $5 billion. That was in 1985...a few years later the company started to reinvent itself in the face of declining defense business. They acquired us (Digital Communications Corp) in 1987 from Microwave Associates. Being 97% commercial we dovetailed with Hughes' plan to diversify.
Howard was really smart in a number of ways. One was that he sized Hughes Aircraft to be manageable in scope. He had lots of opportunity to grow the thing into a massive conglomerate but he never let that happen. He had a great vision of what he wanted the company to be, what he wanted to be involved with, never let it grow beyond that vision. That changed after his death and new corporate management took over.
Another was that he set the company up as a non-profit. What you say? Yup, he set up the Howard Hughes Medical Institute and diverted all of the "profits" generated by Hughes Aircraft to Hughes Medical. He thereby qualified the company as a non-profit which gave him massive tax and filing benefits. Hughes Medical Institute and its massive endowment remains in existence to the current day and is still one of the largest funding bodies of medical research in the nation.
At last count the aggregate value of Hughes' holdings have been sold for north of $150 billion (DirecTV, a Hughes company originally, in its final iteration was acquired/merged with AT&T in the last year for $67 billion alone)...I guess GM's much decried acquisition of the company by Roger Smith, CEO, wasn't so stupid after all, lol...
Healey