MacAndrews & Forbes Holdings
Encyclopedia
MacAndrews & Forbes Holdings, Inc. is the principal holding company
used by and wholly owned by businessman and private equity
investor, Ronald Perelman
. MacAndrews & Forbes holds interests in a diversified portfolio of public and private companies.
Also in 1983, Technicolor Inc.
was acquired. The divisions are sold off and its core business is sold altogether in 1988 to Carlton Communications
for 6.5 times the purchase price. Using the proceeds from the Technicolor division sell off, a 20 percent stake in a similar company was purchased: Compact Video Inc. and increase to 40% in 1987. Despite the bond debt in 1984 saw MacAndrews & Forbes purchasing Consolidated Cigar Holdings Ltd. from Gulf & Western Industries
and Video Corporation of America.
Inc. was purchased next in June 1985 as it had loss that could offset gains of the corporation. Its three retail supermarket chains were sold off with in months and became Revlon Group, Inc. in 1986. In 1985, Perelman took on his biggest deal yet: The Revlon Corporation
. Financed with over $700 million in junk bonds
from Michael Milken's
firm Drexel Burnham Lambert
, Pantry Pride Inc. offered to buy any or all of Revlon's 38.2 million outstanding shares for $47.5 a share when its street price stood at $45 a share. Initially rejected, he repeatedly raised his offer until it reached $53 a share while fighting Revlon's management every step of the way. Forstmann Little & Company
swooped in at $56 a share, a brief public bidding war ensued, and Perelman triumphed with an offer of $58 a share. Perelman paid $1.8 billion to Revlon's shareholders, but he also paid $900 million of other costs associated with the purchase. Perelman had Revlon sell 4 division: 2 for $1 billion, vision care division for $574 million and National Health Laboratories division became a publicly owned corporation in 1988. Additional makeup lines were purchased for Revlon: Max Factor
in 1987 and Betrix in 1989 later selling them to Procter & Gamble
in 1991. Unfortunately for Perelman, Revlon has become nothing but trouble. Despite Perelman's regular cleansing of upper management and injecting millions of dollars into the company, Revlon stubbornly resists turning a profit. As of the first quarter of 2007, it has had one profitable quarter in the past 32. Its lack of profitability shows in its stock price which has plummeted to less than $1.20 a share as of 2007. A major cause of Revlon's financial problems is the huge debt load stemming from Perelman's purchase of the company.
in 1986, offering $4.12 billion. Perelman sold back Gillette stock acquired back to the Gillette Company. He made additional attempts in 1987. A division in 1986 then the rest of Consolidated Cigar in 1988 were sold. Attempted take overs were targeted at TV Services and CPC International
. A refinancing of the Holding companies' junk bond for standard bank loans by the end of 1989.
in 1988 when along with Gerald J. Ford
he bought five insolvent thrifts
with $12.2 billion in assets and $5.1 billion in federal aid for $315 million. The five banks originally operated as a single entity named First Texas Bank, but the name changed to First Gibraltar after about a week. Perelman's turn-around manifested as trimming the payroll, selling branches, and dumping of $2.5 billion of underperforming assets. In 1990, Perelman added San Antonio Savings Association and Sooner Federal to First Gibraltar for $10.1 million and $5.1 million, respectively. The purchase of San Antonio added $1.1 billion of healthy assets, $1.2 billion unhealthy assets, and a $1.3 billion government cash advance to Perelman's larder while Sooner only provided $1.2 billion in assets along with the typical government guarantees. Sooner Federal was not only the last S&L Perelman bought, but the first he sold; In August 1992, he sold the pieces of Sooner to Bank of Oklahoma and Fourth Financial Corporation
for $31.4 million. The following month he sold the rest of First Gibraltar to BankAmerica
for $110 million, retaining four branches in Plano, Texas
and $1.2 billion of assets in the mortgage and property management sectors. He renamed the four branches First Madison. It's unclear how much money Perelman made from his savings & loan deals, but it's estimated that he made anywhere from $600 million to $1.2 billion with most of the profits manifesting as tax breaks elsewhere in his empire. In essence, by owning First Gibraltar he was able to avoid paying hundreds of millions in federal taxes.
Perelman jumped back into the savings & loan game in a big way in 1994 by buying First Nationwide from the Ford Motor Company
for $664 million. Ford held onto $1.8 billion of First Nationwide's assets valued at $444 million, two-thirds of which were considered troubled assets, offered to buy back up to $500 million of First Nationwide's other $7.9 billion of assets that went bad in the future, and gave Perelman $50 million to cover potential severance payments. Perelman quickly boosted its portfolio, adding $10 billion worth of mortgages in exchange for a $175 million payment to Resolution Trust Corporation
. Before 1995 ended, Perelman added two more thrifts to his collective: SFFed's $4.1 billion of assets for $250 million and Home Federal Financial's $735 million of assets and $662 million of deposits for $70.6 million. Just as quickly as he added assets, branches, and deposits in California, he dumped what he had elsewhere in the country. In 1995 alone he sold off 79 branches with $4.3 billion in deposits spread out across five states. 1996 went a little slower, but not eventfully. He acquired California Federal Bancorp
for $1.2 billion, creating the 4th largest thrift in the country with $32.3 billion in assets. In 1997, another $3.3 billion in mortgages were added courtesy of WMC Mortgage but it was an otherwise quiet year for First Nationwide. In 1998, Perelman negotiated a stock swap with Golden State Bancorp to create the third largest thrift in the country with $50 billion of assets. The deal left Golden State's shareholders the majority, but Perelman's camp still controlled the company. Everything remained quiet until May 2002 when Citigroup
announced plans to buy Golden State for $5.8 billion, but ultimately reduced the offer to $4.9 billion due to a stock drop. Citigroup's final offer was 0.821 shares of Citigroup common stock and $7.47 cash for every share of Golden State exchanged, which converted Perelman's 43 million shares of Golden State into $321,210,000 in cash plus 36,124,000 shares of Citigroup. All things considered, Perelman expected to make about $2 billion off the deal, but because he had quasi-sold many of his shares in the past, he probably gained substantially less than that.
In 1989, Andrews Group lost $14.8 million with a negative net worth of $10 million. At this time, MacAndrews & Forbes owned 57%.
In 1991, Marvel Entertainment Group, Inc. goes public with 30% sold to the public.
Andrews Group goes on a buying spree picking up:
In 1994, Perelman bought four more stations from the Great American Communications Company for $360 million and four more from Argyle Television Holdings for $716 million. His purchases set the stage for the Fox affiliate switches of 1994
in which Ronald Perelman rewrote the rules for how television affiliates operated and helped establish Fox
as a force to be reckoned with. Naturally, Ronald took home a tidy profit: In two deals in 1994 and 1996, Rupert Murdoch
bought complete control of New World Communications for $3 billion.
, Inc., maker of stoves, lanterns, and camping and other recreational equipment, for $545 million. Perelman reduced the debt for this purchase by selling the heating and air-conditioning divisions. By the end of 1990 he had sold everything except Coleman's camping equipment and boat businesses, plus added power tool and recreational vehicle businesses. Between 1993 and late 1995 he bought seven more companies for Coleman.
In December 1997, Perelman and Al Dunlap met in order to discuss a possible deal between Coleman and Sunbeam Products
. Coleman's famous but narrow brand held less growth potential than originally thought and Ronald Perelman wanted out. Coincidentally, Al Dunlap was sitting on a financially insolvent company he wanted to dump. It took until March 2 for them to finally come to an agreement: With some convincing from his banker Morgan Stanley, Perelman sold his entire stake (82%) in Coleman to Al Dunlap in exchange for $1.5 billion in cash and $680 million of Sunbeam stock. They completed the deal on March 30, despite a sell-off triggering press release from March 19 that said Sunbeam would not meet sales expectations. On April 3, another press release took Sunbeam's stock from bad to worse: It would not only fall short of sales expectations for that quarter, but it would barely meet the sales expectations of two years ago. The stock went into a tail spin, falling from $54 a share to $24 a share in a matter of weeks and continued its downward spiral in the following weeks. Perelman bought control of Sunbeam in an effort to salvage the situation but it was for naught. The company had to file for bankruptcy within three years.
. Two facts were at issue: Did Morgan Stanley know about the problems with Sunbeam and was Ronald Perelman misled? During the discovery phase, the judge became exasperated with what she perceived as deliberate stonewalling on the part of Morgan Stanley and ordered the jury to assume Morgan Stanley deliberately and knowingly defrauded Perelman. Hobbled, Morgan Stanley had no choice but to argue that Perelman was too savvy an investor to have fallen for their transparent tricks. After a five-week trial, the jury deliberated for two days, found in favor of Perelman, and awarded him $1.45 billion. The damages stung particularly because Morgan Stanley passed up Perelman's offer to settle the case for $20 million. Morgan Stanley maintained that the court case was improperly decided, citing the judge's decision to use Florida law over New York law and her decision to order the jury to consider Morgan Stanley guilty before the trial began. In 2007, the courts of appeal reversed the judgement. The judges' declared Perelman hadn't provided any evidence showing he'd suffered any actual damage as a result of Morgan Stanley's actions. Perelman appealed, but found himself shot down by the Florida Supreme Court
who dismissed it in a 5–0 decision. Undeterred even after that setback, Perelman went back to the trial court and asked for the case to be reopened because the hiding of email evidence was "a classic example of fraud on the court". The trial court rejected his arguments, but as of January 2009, he is beseeching Florida's 4th Circuit to reopen the case.
, but on December 12, 2008, a year after filing for an IPO, MAFS opted to withdraw their application for the "protection of investors".
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
used by and wholly owned by businessman and private equity
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
investor, Ronald Perelman
Ronald Perelman
Ronald Owen Perelman is an American business magnate. Through his company MacAndrews & Forbes Holdings Inc., he has invested in various companies in grocery, cigar, licorice, makeup, car, photography, television, camping, security, lottery, jewelry, banks, and comic book industries.-Early...
. MacAndrews & Forbes holds interests in a diversified portfolio of public and private companies.
Group
Perelman had previously purchased a 40% stake in Cohen-Hatfield Jewelers in 1978, and in 1980 MacAndrews & Forbes & Co., a distributor of licorice extract and chocolate. Perelman had merged Cohen-Hatfield Jewelers and MacAndrews & Forbes & Co. into MacAndrews & Forbes Group Inc.Holdings
In 1983, Perelman forms MacAndrews & Forbes Holdings to take MacAndrews & Forbes Group Inc. private. Perelman starts selling bonds to acquire the remaining 66% stake in MacAndrews & Forbes Group Inc.Also in 1983, Technicolor Inc.
Technicolor
Technicolor is a color motion picture process invented in 1916 and improved over several decades.It was the second major process, after Britain's Kinemacolor, and the most widely used color process in Hollywood from 1922 to 1952...
was acquired. The divisions are sold off and its core business is sold altogether in 1988 to Carlton Communications
Carlton Communications
Carlton Communications was a British media company. It was led by Michael Green and listed on the London Stock Exchange from 1983 until 2 February 2004, when it taken over by Granada plc to form ITV plc with Carlton gaining 32% of the new company....
for 6.5 times the purchase price. Using the proceeds from the Technicolor division sell off, a 20 percent stake in a similar company was purchased: Compact Video Inc. and increase to 40% in 1987. Despite the bond debt in 1984 saw MacAndrews & Forbes purchasing Consolidated Cigar Holdings Ltd. from Gulf & Western Industries
Gulf+Western
Gulf and Western Industries, Inc., for a number of years known as Gulf+Western, was an American conglomerate.- History :Gulf and Western's prosaic origins date to a manufacturer named Michigan Bumper Co. founded in 1934, though Charles Bluhdorn treated his 1958 takeover of what was then Michigan...
and Video Corporation of America.
Revlon Group
Pantry PridePantry Pride
Food Fair, also known by its successor name Pantry Pride, was a large supermarket chain in the United States. It was founded by Samuel N. Friedland, who opened the first store in Harrisburg, Pennsylvania in the late 1920s. As of 1957, Food Fair had 275 stores, and at its peak, the chain had more...
Inc. was purchased next in June 1985 as it had loss that could offset gains of the corporation. Its three retail supermarket chains were sold off with in months and became Revlon Group, Inc. in 1986. In 1985, Perelman took on his biggest deal yet: The Revlon Corporation
Revlon
Revlon is an American cosmetics, skin care, fragrance, and personal care company founded in 1932.-History:Revlon was founded in the midst of the Great Depression, 1932, by Charles Revson and his brother Joseph, along with a chemist, Charles Lachman, who contributed the "L" in the Revlon name...
. Financed with over $700 million in junk bonds
High-yield debt
In finance, a high-yield bond is a bond that is rated below investment grade...
from Michael Milken's
Michael Milken
Michael Robert Milken is an American business magnate, financier, and philanthropist noted for his role in the development of the market for high-yield bonds during the 1970s and 1980s, for his 1990 guilty plea to felony charges for violating US securities laws, and for his funding of medical...
firm Drexel Burnham Lambert
Drexel Burnham Lambert
Drexel Burnham Lambert was a major Wall Street investment banking firm, which first rose to prominence and then was forced into bankruptcy in February 1990 by its involvement in illegal activities in the junk bond market, driven by Drexel employee Michael Milken. At its height, it was the...
, Pantry Pride Inc. offered to buy any or all of Revlon's 38.2 million outstanding shares for $47.5 a share when its street price stood at $45 a share. Initially rejected, he repeatedly raised his offer until it reached $53 a share while fighting Revlon's management every step of the way. Forstmann Little & Company
Forstmann Little & Company
Forstmann, Little & Company is a private equity firm, specializing in leveraged buyouts . At its peak in the late 1990s, Forstmann Little was among the largest private equity firms globally...
swooped in at $56 a share, a brief public bidding war ensued, and Perelman triumphed with an offer of $58 a share. Perelman paid $1.8 billion to Revlon's shareholders, but he also paid $900 million of other costs associated with the purchase. Perelman had Revlon sell 4 division: 2 for $1 billion, vision care division for $574 million and National Health Laboratories division became a publicly owned corporation in 1988. Additional makeup lines were purchased for Revlon: Max Factor
Max Factor
Max Factor & Company is a cosmetics company, founded during 1909 by Maksymilian Faktorowicz , Max Factor, a Polish-Jewish cosmetician. Max Factor & Company was a related, two-family, multi-generational international cosmetics company before its sale in 1973 for $500 million dollars...
in 1987 and Betrix in 1989 later selling them to Procter & Gamble
Procter & Gamble
Procter & Gamble is a Fortune 500 American multinational corporation headquartered in downtown Cincinnati, Ohio and manufactures a wide range of consumer goods....
in 1991. Unfortunately for Perelman, Revlon has become nothing but trouble. Despite Perelman's regular cleansing of upper management and injecting millions of dollars into the company, Revlon stubbornly resists turning a profit. As of the first quarter of 2007, it has had one profitable quarter in the past 32. Its lack of profitability shows in its stock price which has plummeted to less than $1.20 a share as of 2007. A major cause of Revlon's financial problems is the huge debt load stemming from Perelman's purchase of the company.
Other Actions
MacAndrews made an attempted take over of Gillette CompanyGlobal Gillette
Gillette is a brand of Procter & Gamble currently used for safety razors, among other personal care products. Based in Boston, Massachusetts, United States, it was one of several brands originally owned by The Gillette Company, a leading global supplier of products under various brands, which was...
in 1986, offering $4.12 billion. Perelman sold back Gillette stock acquired back to the Gillette Company. He made additional attempts in 1987. A division in 1986 then the rest of Consolidated Cigar in 1988 were sold. Attempted take overs were targeted at TV Services and CPC International
Hellmann's and Best Foods
Hellmann's and Best Foods are brand names that are used for the same line of mayonnaise and other food products. The Hellmann's brand is sold in the United States east of the Rocky Mountains, and also in Latin America, Europe, Middle East and Canada...
. A refinancing of the Holding companies' junk bond for standard bank loans by the end of 1989.
Savings and loans
Perelman first entered what became known as the Savings & Loan crisisSavings and Loan crisis
The savings and loan crisis of the 1980s and 1990s was the failure of about 747 out of the 3,234 savings and loan associations in the United States...
in 1988 when along with Gerald J. Ford
Gerald J. Ford
Gerald J. Ford is a successful Texas banker known for buying and selling thrift banks. Ford bought his first bank in 1975 for $1.2 million and later sold it for a profit of $80 million....
he bought five insolvent thrifts
Savings and loan association
A savings and loan association , also known as a thrift, is a financial institution that specializes in accepting savings deposits and making mortgage and other loans...
with $12.2 billion in assets and $5.1 billion in federal aid for $315 million. The five banks originally operated as a single entity named First Texas Bank, but the name changed to First Gibraltar after about a week. Perelman's turn-around manifested as trimming the payroll, selling branches, and dumping of $2.5 billion of underperforming assets. In 1990, Perelman added San Antonio Savings Association and Sooner Federal to First Gibraltar for $10.1 million and $5.1 million, respectively. The purchase of San Antonio added $1.1 billion of healthy assets, $1.2 billion unhealthy assets, and a $1.3 billion government cash advance to Perelman's larder while Sooner only provided $1.2 billion in assets along with the typical government guarantees. Sooner Federal was not only the last S&L Perelman bought, but the first he sold; In August 1992, he sold the pieces of Sooner to Bank of Oklahoma and Fourth Financial Corporation
Fourth Financial Corporation
Fourth Financial Corporation was a Wichita, Kansas bank holding company that was the largest and one of the oldest banks in Kansas as well as a dominant bank in Oklahoma when it was bought by Boatmen's Bancshares for $1.2 billion in stock in 1995....
for $31.4 million. The following month he sold the rest of First Gibraltar to BankAmerica
Bank of America
Bank of America Corporation, an American multinational banking and financial services corporation, is the second largest bank holding company in the United States by assets, and the fourth largest bank in the U.S. by market capitalization. The bank is headquartered in Charlotte, North Carolina...
for $110 million, retaining four branches in Plano, Texas
Plano, Texas
Plano is a city in the state of Texas, located mostly within Collin County. The city's population was 259,841 at the 2010 census, making it the ninth-largest city in Texas and the 71st most populous city in the United States. Plano is located within the metropolitan area commonly referred to as...
and $1.2 billion of assets in the mortgage and property management sectors. He renamed the four branches First Madison. It's unclear how much money Perelman made from his savings & loan deals, but it's estimated that he made anywhere from $600 million to $1.2 billion with most of the profits manifesting as tax breaks elsewhere in his empire. In essence, by owning First Gibraltar he was able to avoid paying hundreds of millions in federal taxes.
Perelman jumped back into the savings & loan game in a big way in 1994 by buying First Nationwide from the Ford Motor Company
Ford Motor Company
Ford Motor Company is an American multinational automaker based in Dearborn, Michigan, a suburb of Detroit. The automaker was founded by Henry Ford and incorporated on June 16, 1903. In addition to the Ford and Lincoln brands, Ford also owns a small stake in Mazda in Japan and Aston Martin in the UK...
for $664 million. Ford held onto $1.8 billion of First Nationwide's assets valued at $444 million, two-thirds of which were considered troubled assets, offered to buy back up to $500 million of First Nationwide's other $7.9 billion of assets that went bad in the future, and gave Perelman $50 million to cover potential severance payments. Perelman quickly boosted its portfolio, adding $10 billion worth of mortgages in exchange for a $175 million payment to Resolution Trust Corporation
Resolution Trust Corporation
The Resolution Trust Corporation was a United States Government-owned asset management company run by Lewis William Seidman and charged with liquidating assets, primarily real estate-related assets such as mortgage loans, that had been assets of savings and loan associations declared insolvent by...
. Before 1995 ended, Perelman added two more thrifts to his collective: SFFed's $4.1 billion of assets for $250 million and Home Federal Financial's $735 million of assets and $662 million of deposits for $70.6 million. Just as quickly as he added assets, branches, and deposits in California, he dumped what he had elsewhere in the country. In 1995 alone he sold off 79 branches with $4.3 billion in deposits spread out across five states. 1996 went a little slower, but not eventfully. He acquired California Federal Bancorp
California Federal Bank
California Federal Bank, often abbreviated to "Cal Fed", was a savings and loan bank in California with the corporate headquarters being located at 5700 Wilshire Boulevard, in Los Angeles. It existed from 1926 until 2002, when its parent company, Golden State Bancorp, was acquired by Citigroup,...
for $1.2 billion, creating the 4th largest thrift in the country with $32.3 billion in assets. In 1997, another $3.3 billion in mortgages were added courtesy of WMC Mortgage but it was an otherwise quiet year for First Nationwide. In 1998, Perelman negotiated a stock swap with Golden State Bancorp to create the third largest thrift in the country with $50 billion of assets. The deal left Golden State's shareholders the majority, but Perelman's camp still controlled the company. Everything remained quiet until May 2002 when Citigroup
Citigroup
Citigroup Inc. or Citi is an American multinational financial services corporation headquartered in Manhattan, New York City, New York, United States. Citigroup was formed from one of the world's largest mergers in history by combining the banking giant Citicorp and financial conglomerate...
announced plans to buy Golden State for $5.8 billion, but ultimately reduced the offer to $4.9 billion due to a stock drop. Citigroup's final offer was 0.821 shares of Citigroup common stock and $7.47 cash for every share of Golden State exchanged, which converted Perelman's 43 million shares of Golden State into $321,210,000 in cash plus 36,124,000 shares of Citigroup. All things considered, Perelman expected to make about $2 billion off the deal, but because he had quasi-sold many of his shares in the past, he probably gained substantially less than that.
Andrews Group
Andrews Group, Inc. is formed from the corporate shell of the former Compact Video. Andrews Group purchases Marvel Entertainment Group, Inc. in 1989 and later its former parent company New World Entertainment, Inc.In 1989, Andrews Group lost $14.8 million with a negative net worth of $10 million. At this time, MacAndrews & Forbes owned 57%.
In 1991, Marvel Entertainment Group, Inc. goes public with 30% sold to the public.
Andrews Group goes on a buying spree picking up:
- FleerFleerThe Fleer Corporation, founded by Frank H. Fleer in 1885, was the first company to successfully manufacture bubblegum; it remained a family-owned enterprise until it was taken private in 1989....
- September 1992 - Toy Biz, Inc.Marvel ToysMarvel Toys is the toy division of Marvel Entertainment, a subsidiary of The Walt Disney Company....
- 46% Stake - 1993 - SCI Television - 54% Stake - 1993
- Genesis Entertainment - 50% Stake - Part of New World EntertainmentNew World CommunicationsNew World Pictures was an independent motion picture and television production company, and later television station owner in the United States from the late 1980s to the mid-1990s...
.
In 1994, Perelman bought four more stations from the Great American Communications Company for $360 million and four more from Argyle Television Holdings for $716 million. His purchases set the stage for the Fox affiliate switches of 1994
Fox affiliate switches of 1994
The United States television network affiliate switches of 1994 were a series of events resulting from a multi-million dollar deal between Fox Broadcasting Company, known commonly as Fox, and New World Communications, an owner of several VHF television stations affiliated with major networks,...
in which Ronald Perelman rewrote the rules for how television affiliates operated and helped establish Fox
Fox Broadcasting Company
Fox Broadcasting Company, commonly referred to as Fox Network or simply Fox , is an American commercial broadcasting television network owned by Fox Entertainment Group, part of Rupert Murdoch's News Corporation. Launched on October 9, 1986, Fox was the highest-rated broadcast network in the...
as a force to be reckoned with. Naturally, Ronald took home a tidy profit: In two deals in 1994 and 1996, Rupert Murdoch
Rupert Murdoch
Keith Rupert Murdoch, AC, KSG is an Australian-American business magnate. He is the founder and Chairman and CEO of , the world's second-largest media conglomerate....
bought complete control of New World Communications for $3 billion.
Meridian Sports Holdings
Also in 1989, MacAndrews & Forbes acquired The Coleman CompanyColeman Company
Coleman Company, Inc., is an American company that specializes in outdoor recreation products. Historically, Coleman is known for camping gear....
, Inc., maker of stoves, lanterns, and camping and other recreational equipment, for $545 million. Perelman reduced the debt for this purchase by selling the heating and air-conditioning divisions. By the end of 1990 he had sold everything except Coleman's camping equipment and boat businesses, plus added power tool and recreational vehicle businesses. Between 1993 and late 1995 he bought seven more companies for Coleman.
In December 1997, Perelman and Al Dunlap met in order to discuss a possible deal between Coleman and Sunbeam Products
Sunbeam Products
Sunbeam Products is an American brand that has produced electric home appliances since 1910. Their products have included the Mixmaster mixer, the Sunbeam CG waffle iron, Coffeemaster and the fully automatic T20 toaster. Sunbeam is owned by Jarden Consumer Solutions after Jarden's acquisition in...
. Coleman's famous but narrow brand held less growth potential than originally thought and Ronald Perelman wanted out. Coincidentally, Al Dunlap was sitting on a financially insolvent company he wanted to dump. It took until March 2 for them to finally come to an agreement: With some convincing from his banker Morgan Stanley, Perelman sold his entire stake (82%) in Coleman to Al Dunlap in exchange for $1.5 billion in cash and $680 million of Sunbeam stock. They completed the deal on March 30, despite a sell-off triggering press release from March 19 that said Sunbeam would not meet sales expectations. On April 3, another press release took Sunbeam's stock from bad to worse: It would not only fall short of sales expectations for that quarter, but it would barely meet the sales expectations of two years ago. The stock went into a tail spin, falling from $54 a share to $24 a share in a matter of weeks and continued its downward spiral in the following weeks. Perelman bought control of Sunbeam in an effort to salvage the situation but it was for naught. The company had to file for bankruptcy within three years.
Morgan Stanley
On February 17, 2005, Perelman filed a lawsuit against Morgan StanleyMorgan Stanley
Morgan Stanley is a global financial services firm headquartered in New York City serving a diversified group of corporations, governments, financial institutions, and individuals. Morgan Stanley also operates in 36 countries around the world, with over 600 offices and a workforce of over 60,000....
. Two facts were at issue: Did Morgan Stanley know about the problems with Sunbeam and was Ronald Perelman misled? During the discovery phase, the judge became exasperated with what she perceived as deliberate stonewalling on the part of Morgan Stanley and ordered the jury to assume Morgan Stanley deliberately and knowingly defrauded Perelman. Hobbled, Morgan Stanley had no choice but to argue that Perelman was too savvy an investor to have fallen for their transparent tricks. After a five-week trial, the jury deliberated for two days, found in favor of Perelman, and awarded him $1.45 billion. The damages stung particularly because Morgan Stanley passed up Perelman's offer to settle the case for $20 million. Morgan Stanley maintained that the court case was improperly decided, citing the judge's decision to use Florida law over New York law and her decision to order the jury to consider Morgan Stanley guilty before the trial began. In 2007, the courts of appeal reversed the judgement. The judges' declared Perelman hadn't provided any evidence showing he'd suffered any actual damage as a result of Morgan Stanley's actions. Perelman appealed, but found himself shot down by the Florida Supreme Court
Florida Supreme Court
The Supreme Court of the State of Florida is the highest court in the U.S. state of Florida. The Supreme Court consists of seven judges: the Chief Justice and six Justices who are appointed by the Governor to 6-year terms and remain in office if retained in a general election near the end of each...
who dismissed it in a 5–0 decision. Undeterred even after that setback, Perelman went back to the trial court and asked for the case to be reopened because the hiding of email evidence was "a classic example of fraud on the court". The trial court rejected his arguments, but as of January 2009, he is beseeching Florida's 4th Circuit to reopen the case.
SPAC
In 2007, Perelman filed the paperwork for a SPAC (Special Purpose Acquisition Company) called MAFS Acquisition through his holding company MacAndrews & Forbes Holdings. A SPAC is a company founded solely for the purpose of buying out another company, but without any preselected target company. In Perelman's case, the company was selling 50 million units for $10 each. The IPO was being underwritten by CitigroupCitigroup
Citigroup Inc. or Citi is an American multinational financial services corporation headquartered in Manhattan, New York City, New York, United States. Citigroup was formed from one of the world's largest mergers in history by combining the banking giant Citicorp and financial conglomerate...
, but on December 12, 2008, a year after filing for an IPO, MAFS opted to withdraw their application for the "protection of investors".
Current
As of 2010, MacAndrews & Forbes held interests in the following companies:- MacAndrews AMG Holding, LLC
- AM GeneralAM GeneralAM General is an American heavy vehicle manufacturer based in South Bend, Indiana. It is best known for the civilian Hummer and the military Humvee, that is assembled in Mishawaka, Indiana...
-- amgeneral.com -- 70% share purchased in 2004
- AM General
- Deluxe Entertainment Services Group Inc.
- Faneuil, Inc.
- M & F WorldwideM & F WorldwideM&F Worldwide Corp. , formerly Power Control Technologies, Inc., was incorporated in Delaware on June 1, 1988 and is a NYSE listed public holding company that is a part of the Ronald O...
(MFW)- Harland Clarke Holdings Corp.
- Harland Clarke Corp. -- harlandclarke.com -- formerly Clarke American Corp.
- Checks in the Mail -- checksinthemail.com
- Harland Financial Solutions -- harlandfinancialsolutions.com
- ScantronScantronScantron is an American company based in Eagan, Minnesota, that manufactures and sells machine-readable papers on which students mark answers to academic multiple-choice test questions. To analyze those answers, the machines use image-based data collection software and scanners...
- Harland Clarke Corp. -- harlandclarke.com -- formerly Clarke American Corp.
- Mafco
- Harland Clarke Holdings Corp.
- PanavisionPanavisionPanavision is an American motion picture equipment company specializing in cameras and lenses, based in Woodland Hills, California. Formed by Robert Gottschalk as a small partnership to create anamorphic projection lenses during the widescreen boom in the 1950s, Panavision expanded its product...
- Revlon Group, Inc.
- RevlonRevlonRevlon is an American cosmetics, skin care, fragrance, and personal care company founded in 1932.-History:Revlon was founded in the midst of the Great Depression, 1932, by Charles Revson and his brother Joseph, along with a chemist, Charles Lachman, who contributed the "L" in the Revlon name...
, Inc.
- Revlon
- Scientific Games CorporationScientific Games CorporationScientific Games Corporation is a New York City-based company that provides gaming solutions to lottery and gaming organizations worldwide. Products include instant lottery games, lottery gaming systems, terminals and service, and internet applications....
- SIGA Technologies Inc
- TransTech Pharma
Former
- AlliedBartonAlliedBartonAlliedBarton Security Services is a security officer company in the United States, made up of the former companies Barton Protective Services, Spectaguard, Initial and Allied Security. It is the largest American owned security company in the United States, employing approximately 50,000 people...
- Andrews Group, Inc. (formerly Compact Video Inc.)
- Marvel Entertainment Group, Inc.
- FleerFleerThe Fleer Corporation, founded by Frank H. Fleer in 1885, was the first company to successfully manufacture bubblegum; it remained a family-owned enterprise until it was taken private in 1989....
- SkyBoxSkyboxSkybox may refer to:* a luxury box at a sports arena or stadium* the Digibox satellite decoder* Skybox , an American indie pop band* SkyBox International, a trading card company...
- ToyBiz
- New World CommunicationsNew World CommunicationsNew World Pictures was an independent motion picture and television production company, and later television station owner in the United States from the late 1980s to the mid-1990s...
Group- New World EntertainmentNew World CommunicationsNew World Pictures was an independent motion picture and television production company, and later television station owner in the United States from the late 1980s to the mid-1990s...
- SCI Television
- Genesis Entertainment
- Guthy-Renker CorporationGuthy-RenkerGuthy-Renker LLC is a direct-response marketer known primarily for selling products in the United States via infomercials. The company also sells products direct to consumer through a variety of media channels via offices in numerous countries...
- New World Entertainment
- First Gibraltar Bank
- Golden State Bancorp
- Consolidated Cigar Holdings Inc.
- TechnicolorTechnicolorTechnicolor is a color motion picture process invented in 1916 and improved over several decades.It was the second major process, after Britain's Kinemacolor, and the most widely used color process in Hollywood from 1922 to 1952...
, Inc. - Meridian Sports Holdings
- Coleman CompanyColeman CompanyColeman Company, Inc., is an American company that specializes in outdoor recreation products. Historically, Coleman is known for camping gear....
, Inc. - Boston WhalerBoston WhalerBoston Whaler is a boat company that builds foam filled fiberglass boats. Boston whaler was founded in 1958 by Richard T Fisher, and is still in business today.-History of the Design:...
Inc. - MasterCraftMasterCraftMasterCraft is a United States manufacturer of luxury high performance boats that was founded in 1968 and is currently headquartered in Vonore, Tennessee...
- Skeeter
- O'Brian
- Coleman Company
- Mafco Holdings, Inc.
- Consolidated Cigar Holdings Inc. (2nd Time)
- Mafco Consolidated Group
- Abex