J.

Perez Foods (A)

You are a friend of Jaime Jr. and he has come to you for help in dealing with
his sister, Mercedes.Present recommendations to him to resolve this
situation.

Case notes

Overview
 Jaime perez became president in 1994 after working in dads meat processing
business since 1976.
o Mever anticipated family strife
 None of sisters prior to dads death had worked in the business
 Share breakdown
o Jaime-20% non voting shares, 48% voting

m
o Five sisters- each with 15% non voting shares 5% voting shares

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o Mother(Lena)- 5% non voting shares, 17% voting

co
 Mercedes youngest sister at 24

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o Concerned about own family and financial security once father dies

o.
o November 1996- began working in company as a manager of HR
rs e
o Personal mission to investigate how company was managed- Jaime
ou urc
doesn’t know
 Felt as an owner- her right to make improvements
 Routinely challenged employees, disciplined people in different
o

departments she felt were not performing adequately

aC s

 Jaime finds out 3 months later in Feb 1997- explains systems in place to
vi y re

monitor employees
 Emphasized responsibility of supervisors not hers to oversee the employees
 Mercedes resigns soon after but continues to vocalize concerns about
ed d

company and Jaime Jr’s control to husband mother and sisters

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 According to Jaime
o Frew weeks after resignation Mercedes showed up and demanded
financial information from controller carlos lopex
o Sent a memo saying any information requested by a stockholder needs
is

to be authorized by Jaime
Th

o Sent a copy of this memo to all the shareholders

 Mercedes threatened to involve lawyers and financial people to help her
understand what is going on
 Sisters tell Jaime problem is on him
sh

 Family does not understand roles are outside of mgmt. in the business- try to
get involved at dinners
 Entire family strained
An Uncommon Entrepreneur
 Born in DR

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 Completed military service at age 26

Saved half of money he earned in military and loaned out savings to

accrue interest
 1962 at age 40- founded J Perez Foods- growing and selling rice
 1968- accepted meat plant in exchange for debt owed
 rose from meager beginnings to respected man in DR
 congressman and senator
 devoted and honest reputation- began work at 4am every day
The Perez Family
 Jaime marries Lena- has 6 kids- 5 daughters and a son
o Jaime second oldest born in 1952, Mercedes youngest born in 1970
 Family supportive and loyal
o Three oldest sisters close and two youngest close
o Jaime jr was joked about by sisters for extravagant taste and being
ambitious

m
er as
o Two youngest Mercedes and Linda had very close relationship

co
o Mercedes received a lot of attention as youngest and preferred to stay

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close to home
o M went to Switzerland at age 18- wanted to leave but Linda prompted

o.
rs e
her to stay until Easter
ou urc
o Jaime feared if she did not stay she would continue to be controlled by
her emotions
o Linda(business degree) only sister with strong interest in business
o

thought she may enter someday- but married Mexican man and
aC s

moved to Mexico
vi y re

o Carmen settled in Miami and started a business as a supplier to J Perez

foods
o Showed no favoritism towards J Perez foods-
The Father Son work relationship
ed d


ar stu
is
Th
sh

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