Brunner, Worth $100 Million, Took $372,000 Salary While Laying Off Workers
Vi-Jon’s Credit Downgraded As Result of Brunner’s Greed, Mismanagement
Jefferson City, Mo.--At a debate in St. Joseph this morning, Senate candidate John Brunner once again cited, inaccurately, his business philosophy as being, “officers ate last,” despite recent news reports that show Brunner’s business philosophy is to consistently put his own personal wealth and self-interest ahead of his employees and Vi-Jon’s financial security.
Just last week, it was reported that Vi-Jon’s credit rating was downgraded as a result of millions of dollars in debt taken on during Brunner’s tenure as CEO, lending credibility to his claim today that he has a lot of personal experience with debt.
“His misleading TV ads may try to convince you otherwise, but John Brunner’s business record couldn’t be clearer: he only cares about his own bottom line, not Vi-Jon or the hard-working Missourians he recently laid off,” said Caitlin Legacki, Missouri Democratic Party spokeswoman. “John Brunner said today he’s worried about being ‘out of touch,’ but that ship sailed the minute he engineered the risky business dealings that led to his company’s credit downgrade and again when he continued taking a $372,000 salary while laying off workers and again when he admitted he doesn’t know the minimum wage, but said it’s still too high. Perhaps John Brunner should have taken some of the $2.2 million he’s already put into his own campaign and used it to buy a clue instead.”
During his tenure as CEO of Vi-Jon, Brunner oversaw a series of credit agreements that put a heavy debt load on Vi-Jon and were explicitly cited by Moody’s as their reason for downgrading the company’s credit rating last month. Brunner has refused to answer any questions about how much he personally profited from these risky business dealings at the expense of Vi-Jon's fiscal security.
“Now maybe some of us in our earlier days we borrowed too much. Some of you may have borrowed too much from the wrong people. You know that can be pretty problematic. But we have to get ourselves back growing again. We have to figure out how we grow America--how we grow our jobs. I've seen this first hand in my own business.”
In two key exchanges at today’s debate, Brunner discussed his company’s experience with debt and his “philosophy” as a businessman. Brunner regularly says he operates his business with an “officers eat last” mentality, but the truth is completely different. Brunner, worth more than $100 million, took a salary of nearly $400,000 last year while Vi-Jon was laying off hard-working Missourians, but that didn’t stop him from reiterating this line, which is clearly inaccurate:
“In the chow line, senior officers ate last. Now, you seldom ran out of food that way. In my business when we had tough times, which there were quite a few, the pay raises, pay cuts started at the top and worked their way down. When good times came back, the pay raises started on the bottom and worked their way up.”
Vi-Jon Credit Downgrade Rooted In Debt Incurred Under Brunner's Watch As CEO
Moody's Cited Vi-Jon's "Weak Credit Metrics" for Downgrade. "Vi-Jon's B2 Corporate Family Rating is constrained by the company's weak credit metrics, specifically its high leverage (over 6.0 times as of FYE 2011 including Moody's standard adjustments and one-time items), weak profitability and cash flows, relatively small scale and more limited pricing flexibility as compared to its branded peers." [Moody's Investors Service, 4/11/12]
Moody's: Vi-Jon Liquidity Constrained by Two Credit Facilities Set to Expire in 2013 and 2014. "Vi-Jon's adequate liquidity profile is supported by its cash flow from operations (which is expected to improve from FY11 levels), and modest cash balances. Although Vi-Jon maintains full availability under its $30 million secured revolving credit facility, liquidity is constrained by the near-dated expiration of the facility on April 24, 2013. In addition, the company faces the maturity of its term loan B facility on April 24, 2014." [Moody's Investors Service, 4/11/12]
Credit Facilities Cited by Moody's Funded the 2006 Merger of Vi-Jon and Cumberland Swan. "Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to VJCS Acquisition Inc. The rating outlook is stable. At the same time, ratings were assigned to the company's $190 million senior secured financing, consisting of a $30 million revolving credit facility maturing in 2012 and a $160 million term loan B maturing in 2013...The debt issuances were used to help fund the acquisition of Vi-Jon Laboratories Inc. and Cumberland Swan Holdings Inc. by Berkshire Partners. [Market News Publishing, 7/24/06]
Brunner As CEO Oversaw Vi-Jon's Merger With Cumberland Swan. Reported the Daily Deal, “Boston-based private equity firm Berkshire Partners LLC has bought Vi-Jon Laboratories Inc. and Cumberland Swan Holdings Inc. for an undisclosed price. Both companies manufacture private-label personal care products, such as toothpaste, liquid soaps, first-aid products, baby wipes and shampoo, for large retailers such as Wal-Mart Stores Inc., Target Corp. and Safeway Inc…Both companies had been owned primarily by their managers, with no institutional shareholders, Lutzker said. Both companies were the same size, he said, but he declined to give the deal price or other financial figures such as revenues. He did say the new company would have 1,500 employees and three manufacturing plants. Vi-Jon's current CEO, John Brunner, will run the company.” [Daily Deal, 7/24/06]
Brunner Previously Led Vi-Jon to the Brink of Disaster, Bankruptcy
Brunner Said Vi-Jon Took On Too Much Debt In Early ‘90s, Taking Company To “Brink Of Disaster.”
Reported theAssociated Press, “In the 1990s, Brunner said the company incurred a lot of debt for new facilities and equipment that put the business ‘at the brink of disaster.’ Much of the company was sold in 1995 and, since then, he said it has rebounded from a workforce of several dozen people to employ about 1,500. ‘It was a lesson I have never forgotten and one most of our career politicians have never understood,’ Brunner said. ‘America cannot borrow and spend its way to prosperity.’” [Associated Press, 10/3/11
Vi-Jon Lays Off Workers While Brunner, Worth $100 Million, Takes $372,000 Salary
Brunner Was Paid $372,000 by Vi-Jon in 2011. According to his personal financial disclosure, Brunner received $372,000 in salary from Vi-Jon in 2011. [Brunner Personal Financial Disclosure, Filed 2/2/12]
- Brunner's Net Worth As Much as $108 Million. According to his personal financial disclosure, Brunner's net worth is as much as $108 million. [Brunner Personal Financial Disclosure, Filed 2/2/12]
October 2011: Vi-Jon Commissioned Round Of Layoffs.
Reported the St. Louis Post-Dispatch’s Political Fix, “The campaign website for Republican businessman turned U.S. Senate hopeful John Brunner dubs him ‘John the Job Creator.’ But, less than a month afterBrunner's kick-off, his company has joined the long list of firms adding to the nation's unemployment toll. An official for Vi-Jon, which produces the hand sanitizer Germ-X, confirmed Thursday the Vinita Park company did commission a round of layoffs this week. ‘We did have a reduction in force and as a matter of policy we don't talk about personnel matters,’ said Scott Wilson, Vi-Jon's chief human resource office. ‘We are a privately held company.’” [Political Fix, St. Louis Post-Dispatch, 10/27/11
- Headline: Germ-Ex: Senate hopeful Brunner's company trims workforce. [Political Fix, St. Louis Post-Dispatch,10/27/11]
Layoffs “Not Good News For A Rookie Candidate Whose Platform Focuses On Experience Creating Jobs.”
Reported the St. Louis Post-Dispatch’s Political Fix, “Even so, the layoffs are not good news for a rookie candidate whose platform focuses on experience creating jobs. It might also take away some luster from his campaign slogan: ‘Get America Working Again.’” [Political Fix, St. Louis Post-Dispatch, 10/27/11
National Journal On Vi-Jon Layoffs: “Not The Story Brunner Would Want To See In … A Campaign In Which He’s Trying To Tout His Business Acumen.”
Reported the National Journal, “Once your campaign website dubs you ‘John the Job Creator,’ the optics of your own company announcing a round of layoffs are not good. That's the situation Missouri Republican Senate candidate John Brunneris facing. The St. Louis Post-Dispatch reports that Brunner's company, Vi-Jon, commissioned a round of layoffs this week. . . . Not the story Brunner would want to see in the early stages of a campaign in which he's trying to tout his business acumen.” [National Journal, 10/27/11