Treasurer of the seas

Black Enterprise, Oct, 1995 by Sharon R. King

For Clarence Otis, joining Darden Restaurants meant more than moving from humid New York City to balmy Florida. The new vice president and first-ever treasurer of Darden--the parent company of the 1,200-plus chain of Red Lobster, Olive Garden and China Coast restaurants--has stepped away from a career in investment banking into corporate America.

The move has offered Otis an unexpected opportunity to broaden his arsenal of capital finance and debt management skills beyond the area of municipal finance. While Otis, 39, can't refer to a resume full of previous treasury experience, his talents make him well-suited for the job.

"He has the technical skills and some pretty well-rounded management skills," says Rick Walsh, a Darden spokesman who was one of the executives who met with Otis before he was offered the treasurer's post.

"We are a brand-new, 27-year-old company," Walsh says, alluding to Darden's spin-off from General Mills in May. "[The job] requires broad talents. What really stood out were his leadership skills. Clarence just walked in and we said `he's the guy,'" Walsh recalls.

Darden officials were impressed by Otis's financial and legal expertise. Otis began his career as an associate with Donovan Leisure Newton & Irvine, then moved to another New York law firm, Gordon, Hurwitz, Butowsky, Weitzen, Shalov & Wein, where he specialized in securities litigation. He then moved into investment banking, working as a vice president in the public finance department at the now defunct Kidder Peabody & Co. Most recently, Otis was managing director of public finance for Chemical Securities.

At Darden, Otis handles the company's cash-management operations. He determines what mix of debt and equity the company will have, as well as whether the debt will be long- or short-term and the kinds of securities it should be made up of.

Darden is now the world's largest casual dining restaurant company. It's also the second largest publicly traded restaurant company after McDonald's. The firm is "very interested in making sure they have the right mix of capital," says Otis, who sees his mandate as ensuring that the company continues its earnings growth.

These are key decisions for Darden, which employs more than 118,000 people and had $3.2 billion in sales last year, as it plots its course for the future away from the protective enclave of its former corporate partner. Darden has a healthy balance sheet, with $1.758 billion in assets and about $350 million of debt.

One of Otis' tasks is to evaluate Darden's cost structure and determine where margins can be improved, as well as formulate strategies for continued growth. While he oversees a staff of six, Otis' responsibilities touch on most areas of Darden's financial operations, including real estate management and the company's purchasing transactions with 45 countries.