Republican gubernatorial nominee Bill Haslam on Monday said Democrat Mike McWherter's broad attempt to link Haslam's business with a partner's investments in Iran are "silly," that he is disappointed in McWherter for making the charge and that the step is the kind of thing that turns people off about politics.
Haslam, the mayor of Knoxville, spoke just before a Republican Reagan Day dinner in Hardin County Monday night after McWherter held a press conference in Nashville in which McWherter drew links between the Haslam family's Pilot Corp., its partner CVC Capital Partners and CVC's separate investment in a German company, Evonik, which McWherter says is active in Iran.
"I think it's very silly," Haslam said Monday night. "There's no connection at all. I guess I'm disappointed in ... Mike is out saying, 'Hey, we want to talk about jobs,' and he's bringing up something that literally has no connection to a Tennessee company."
McWherter in his press conference said voters have a right to know about their governor's business interests, that Haslam has been deceptive in the way he portrays the family business and that Pilot has sought a tax haven by incorporating in Delaware.
"To be honest with you, I'm disappointed because it's the worst kind of politics, which is just smear and throw something out there without asking questions first, and the truth is there is zero connection, period, end of story," Haslam said.
Lt. Gov. Ron Ramsey, who was the keynote speaker at the Hardin County event, was equally tough on McWherter when asked about the issue.
"I think that's desperation by a candidate who knows he's in over his head and knows there is no way to legitimately win this election, so therefore Mike McWherter has to throw diversionary tactics out there to try to sell people on something that has nothing to do with running state government," said Ramsey, who lost in the Republican primary to Haslam.
Haslam said he doesn't see how anyone could say he has been disingenuous about the business.
"Pilot has had a partner. When we did the deal with CVC, it was publicly announced," Haslam said. "Prior to that we had a different partner, publicly announced."
That reference was to Marathon oil.
"They were a partner, and we bought them out, and then we sold part of it back to them, and then bought them out again," Haslam said.
"It's not like it's been any secret. Pilot has had partners before."
The issue arose in a recent televised debate between McWherter and Haslam, when McWherter asked Haslam about being in business with an entity headquartered in Luxembourg. The reference was to CVC Capital Partners, which bought a 47.5 percent investment in Pilot's truck stop chain in 2008.
Pilot Corp. is fully owned by the Haslam family, but Pilot Corp. partners with CVC, a private equity group, on the travel centers. Pilot separately owns 100 percent of a set of convenience stores. It recently merged with the Flying J travel plazas to make for Pilot Flying J truck stops.
Haslam said the arrangement with CVC is a typical way of doing business.
"You've got a firm that's made an equity investment in Pilot. They have other equity investments, but that's how investment firms work," Haslam said. "There is zero connection."
Haslam's business status has been a constant issue in the governor's race, since he refused in December 2009 to disclose his income from Pilot, although he did disclose income from other investments. Republican opponents hit Haslam on lack of disclosure and the potential for a conflict of interest for Haslam if he is elected governor. U.S. Rep. Zach Wamp of Chattanooga was toughest on Haslam about Pilot among the Republican candidates, although Shelby County District Attorney General Bill Gibbons was vocal on the subject before he dropped out of the race.
"Any time we've had a transaction, it's been publicly announced," Haslam said.
"I don't get it, quite frankly."
Haslam's father, James Haslam II, founded the company, and Bill Haslam's brother, Jimmy, is the chief executive officer of Pilot. Bill Haslam is no longer an executive with the company, serving as Knoxville's mayor for two terms. He frequently points to his track record as mayor to defend how he would treat Pilot as governor.
Haslam was asked if he had spoken to his father about the McWherter allegations, and he said no.
"There's nothing to talk about," Haslam said.
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