The death of Cubic Corp.'s 97-year-old founder and CEO is igniting new speculation about whether the San Diego-based military training and mass transit systems company will remain independent.
Walter J. Zable, who founded the company in 1951 and ran it until his death last month, steadfastly refused to sell out, and since he controlled 40% of the company's stock, that was that. But a recent article in the New York Times notes that Cubic's dominant positions in air- and ground-combat training systems make it an attractive target for a large contractor. Cubic shares closed at $51.23 on Monday, up more than 13% since the last trading day before Zable's June 23 death.
Such speculation is hardly new. When I profiled Zable last year as the industry's oldest and longest-serving CEO, a Wall Street analyst told me that rumors about his health sometimes drove the stock, with the assumption that his death would open the door to a Cubic sale. I chose not to include the comment in my story, considering that I found Zable to be perfectly coherent and in good health for a 96 year old.
Now that he's gone, it will be interesting to see what happens to Cubic.
Under the surface for some time.