Newport-Based Costain : British Builder Fires President in Dispute
Costain Homes Inc., the British home builder in Newport Beach, has fired President Jack M. Dangelo in a dispute over his outside business dealings and the way the company was run.
Dangelo, 41, said he was fired in April as he was planning to resign. He had held the job for 2 1/2 years. He said he is now talking to several other companies about a job.
Dangelo said Costain told him that his outside business dealings constituted a conflict of interest. Costain had no comment.
But Dangelo, who once also worked with a Dutch company, said the dispute was part of a broader misunderstanding over the cultural differences between doing business in Great Britain and in Southern California.
“Ninety percent of the way the two cultures do business is exactly alike and goes smooth as silk,” he said.
Building Since 1865
“It’s the other 10% that comes up and bites you on the fanny every time.”
The Newport Beach home builder is a unit of Costain Group PLC, a London company that began building homes in England in 1865 and has grown into one of the world’s largest construction companies.
Like other British home builders--there are at least four others operating in Southern California--Costain was drawn to the region’s booming real estate market. The company landed here after a main source of income--major construction projects for the oil kingdoms of the Middle East--began to dry up in the early 1980s.
The British builders tend to hire local executives to run their U.S. operations but are said to often retain tight control. Other British builders have also occasionally scrapped with their American executives, who are sometimes used to a more freewheeling style in the Southern California home-building industry.
Costain’s U.S. home-building subsidiary opened in 1987. Company officials said last year that they expect to be building 500 houses a year by 1990, a sort of watershed number that separates big builders from their smaller competitors. Costain said it would sink $200 million into the new company over its first five years.
Major Land Purchase
The company has built houses in San Bernardino and Riverside counties and has made some major land purchases in Orange County.
The British parent company also operates mines--now its biggest source of profits--and manages property, the second biggest source.
Dangelo was reluctant to disclose details of his disagreements with the company.
“I was not happy with the way the company was being managed, and they were not happy with my own personal business interests,” Dangelo said.
Dangelo said that those personal business interests were “very minor” and that he hadn’t realized that the British company would consider them a conflict of interest.
There were also differences over management of the company, Dangelo said. “Decisions were being made in the United Kingdom that were not being made with the benefit of full knowledge of local conditions,” he said. He would not elaborate.
“They’re still a good company with good people,” Dangelo said. “But there are subtle differences between the way we do business over here, and that’s what caused my problem.”
Dangelo, a Newport Beach resident, has worked for several developers and a consulting firm. Before Costain, Dangelo was a partner in Pacific Resources Group, a partnership that built houses and condominiums in Laguna Niguel.
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