Big Five (Hawaii) - History

History

Sugar plantations in Hawaii had a slow start, although the plant had been cultivated for hundreds of years. When Hawaii was annexed by the United States, change came rapidly as sugarcane plantations gained a new infusion of investment. By eliminating tariffs imposed on sugarcane producers by the United States, planters had more money to spend on equipment, land and labor. Increased capital resulted in increased production. Five kingdom-era corporations benefited from annexation, becoming multi-million dollar conglomerations that controlled 90% of the sugar business. The companies colluded to keep the prices on their goods and services high. Their profits skyrocketed even more. Soon, the executives of the Big Five sat on each others' boards of directors. With economic power came political power, and the families usually favored the Republican Party of Hawaii.

During the Democratic Revolution of 1954, the unions inflicted a decisive blow against the giants and the sugar industry declined after Hawaii became a state in 1959; so did each of the Big Five companies. The greatest post-statehood challenge came as the U.S. Department of Justice challenged the ownership of Matson Navigation Company by four of the five companies (all except Theo H. Davies). The lawsuit was settled when the four companies agreed not to share officers, executives, and directors. Alexander and Baldwin eventually bought out the other three stakes in Matson in 1964.

In the 1970s, as sugar plantations closed, many of the Big Five companies themselves were bought out. Where the companies are now:

• Theo H. Davies was bought in 1973 by Scottish-controlled Hong Kong firm Jardine Matheson. The only remaining portion of the company is a blind pool JTH Davies which is incorporated in Manila and trades on the Philippine Stock Exchange. Until December 2004 it owned the Pizza Hut and Taco Bell franchises in Hawaii.
• C. Brewer was bought in 1978 by Philadelphia-based IU International, and was later bought out by its management in 1986. In 2001 the company's shareholders voted to liquidate the company over several years.
• In 1985, Castle & Cooke merged with Flexi-Van Corporation, owned by David H. Murdock. Murdock became its chairman after the merger, then took full control in 2000. It still owns large portions of Central Oʻahu and the Iwilei area of Honolulu around the former Dole Food Company pineapple cannery. Until recently, Castle & Cooke owned nearly all of the island of Lānaʻi; in June 2012, Oracle CEO Larry Ellison bought their share for approximately half a billion dollars.
• Amfac was bought out in 1988 by Chicago-based JMB Realty. In 2002 Amfac declared Chapter 11 bankruptcy and emerged as Kaanapali Land, LLC. It owns 5,000 acres (20 km²) in West Maui. Its department store, Liberty House, was sold to Federated Department Stores and is now part of the Macy's chain.
• Alexander & Baldwin was not bought out and remains strong thanks to its ownership of Matson Navigation, the leading ocean transportation company between Hawaii and the U.S. mainland. Today it owns about 91,000 acres (370 km²) of land and is the fifth-largest landowner in the state.