This year, BLACK ENTERPRISE celebrates the 45th anniversary of its roster of the nation’s largest black-owned businesses-The BE 100s. To commemorate the significance of this collective’s widespread impact on black business and economic development as well as American industry over four decades, we have presented 45 milestones moments. As part of this tribute, we continue our yearlong countdown.
Today we reveal No. 26 in the web series “Great Moments in Black Business.”
1981: Raymond V. Haysbert, Sr. and the management team of Parks Sausage Co, launched by the legendary African American entrepreneur Henry Parks, execute the first leveraged buyout of a historically black-owned company. After Parks Sausage declined under white ownership between 1977 and 1982, Haysbert and his team bought the company for $4 million, returning it to the BE 100s.
When it comes to taking a round trip in black entrepreneurship, probably few executives knew that voyage better than Raymond V. Haysbert, Sr. In a gutsy deal, while serving as CEO of Parks Sausage, Haysbert and his colleagues acquired the company after it had been controlled by white investors.
The cycle began in 1977 when H.G. Parks Inc. Founder and CEO Henry G. Parks sold his sausage manufacturer to Norin Corp. for $5 million, more than double its value on the NASDAQ stock exchange, as reported in BLACK ENTERPRISE. The transaction, very lucrative for Parks, was the start of a bleak period for the iconic company.
The merger was not a good marriage as Norin was unable to continue its 25-year run of record profitability, largely hurt by rising operating expenses and withdrawal of $2 million in accumulated cash, according to a June 1981 BLACK ENTERPRISE article. “There was a certain amount of deterioration,” Parks told BE regarding control under what he called the “Norin Regime” during those years. “We had hoped it would have been a springboard to a bigger plateau-to expand the company beyond what we could do. But it just didn’t pan out.”
In 1981, after sales plunged, Parks Sausage was sold to Haysbert and other company executives who formed Parks Acquisition to amass the company’s $4 million in assets. The buyout came after Norin was acquired by Canadian Pacific, according to BLACK ENTERPRISE.
Among Haysbert’s greatest feats before his death in 2010 was running and owning one of America’s most successful black-owned businesses. Plus, he oversaw a leveraged buyout before most folks even knew what the transaction was.
He was recruited by Henry Parks, an original member of the BLACK ENTERPRISE Advisory Board, after the pioneering entrepreneur launched the Baltimore-based sausage manufacturer in 1951, Parks mortgaged his home to start the company and then struggled to succeed in the Jim Crow South. Parks and Haysbert teamed up in 1952 and began selling the meat products throughout the city. After suffering losses the first two years, Parks started cooking due to hard work and strategic focus. By 1955, the company grew to become a sponsor of the World Series. A decade later, it posted annual gross profits of $6 million by 1966 and $9 million in 1968. It was one of the first black-owned companies to go public in 1969.
By 1973, H. G. Parks, Inc.-its official corporate name at the time-made its debut on the first BE Top 100 roster at No. 8, grossing $13.8 million in revenues, and remained among the 10 largest black-owned companies until its sale to Norin in 1977. A year after returning to black ownership, the renamed Parks Sausage Co. was ranked No. 29 on the 1983 Top 100, producing $19 million in gross revenues.
The company was a household name, famous for its jingle, “More Parks Sausages, Mom … Please.” By the mid-1980s, Parks Sausage was making about $30 million a year. Henry Parks would see his company return to its former glory before his death in 1989.
Haysbert became more influential during this growth period, serving on several boards of directors, including the Baltimore Federal Reserve. But by the mid-1990s, plagued by flagging sales and heavy debt, Baltimore’s largest black-owned manufacturer began to tumble. It was forced for the fourth time to seek a buyer. A deal to sell to two investors tied to TLC Beatrice International collapsed as the buyers couldn’t gain financing, Parks Sausage Chairman Haysbert told The Baltimore Sun in 1996.
The company’s balance sheet, with about $7.8 million in debt, made selling to any buyer a much tougher proposition. A new, big factory for Parks Sausage proved too great an expense for the business it was taking in. Haysbert, who then owned the company with his son Reginald, maintained that its finances grew worse since he moved the factory from its longtime home near Camden Yards ballpark to a fresh $16 million factory at Parks Circle in 1990. Plus, Parks Sausage lost Pizza Hut and Domino’s Pizza, two of its biggest sausage customers. Annual sales fell from about $28 million in 1990 to $20.5 million in June 1995.
After filing Chapter 11 bankruptcy and being forced to close, Parks Sausage was sold to former NFL great Franco Harris, the majority owner of Pittsburgh-based Super Bakery Inc., in September 1997 for $1.7 million. By 1999, Parks Sausage’s factory-not its name or product line-was acquired by Philadelphia-based Dietz & Watson Inc. Parks Sausage President Lydell Mitchell, the former Baltimore Colt star, told the media.
That sale ended the storied history of a celebrated black institution.