Sam Wyly
Encyclopedia
Samuel "Sam" Wyly is an American entrepreneur and businessman, philanthropist, and major contributor to conservative campaigns and candidates. In 2006, Forbes magazine estimated his net worth at $1.1 billion. His older brother, Charles Wyly, Jr.
, was nearly equal in wealth; the two brothers were close with their business affairs, and were often referred to as the "Wyly brothers". Wyly's memoir, 1,000 Dollars and an Idea: Entrepreneur to Billionaire, was published in September 2008.
, the seat of East Carroll Parish in northeastern Louisiana
and one of the poorest communities in the United States. He began working at an early age, helping his father, Charles Wyly, Sr., and mother, Flora Wyly, publish a weekly newspaper, the Delhi Dispatch in Delhi
in Richland Parish
. He sold advertising, wrote stories, folded and addressed the finished papers, and cleaned the printing presses.
Following high school, Wyly went to Louisiana Tech University
. He worked his way through college by selling class rings.He and his brother later honored one of their Tech professors, Robert C. Snyder
, of the English department, with an endowed chair.
Following graduation, Wyly went to the University of Michigan
's School of Business in Ann Arbor
, Michigan
, where in 1957 he received a Master of Business Administration
degree before such credentials became so recognized. He is one of seventeen Michigan Business School graduates who are billionaires. He was able to attend only because of a new scholarship program, having enrolled as the school's first Paton scholar .
to work as a salesman at IBM
's Service Bureau Corporation. Three and a half years later he left IBM to become the area sales manager for Honeywell
, establishing their computer business in Dallas and Oklahoma.
Wyly's wealth comes from businesses that he founded and developed, or purchased and expanded;
s.
In 2000, Sam Wyly contributed $2.5 million to a group called "Republicans for Clean Air", which ran ads praising George W. Bush
's environmental record and criticizing that of John McCain
. The ads ran in New York, Ohio, and California in advance of early March primaries, at a time when Bush and McCain were locked in a tight struggle for the Republican presidential nomination. It initially was unclear who was behind the group or who paid for the ads until Wyly stepped forward to take the credit.
In 2004, Wyly also donated $20,000 to the Swift Boat campaign that raised questions about Sen. John Kerry's military record in Vietnam, helping scuttle Kerry's challenge to Bush. Wyly said in 2008 that he was not leaning toward either Republican John McCain or Democrat Barack Obama in that year's presidential campaign, and would not get involved in the race.
With Charles, he funded the Charles Wyly Sr. Tower of Learning on the campus of Louisiana Tech, in memory of their father. The building includes a computer center and the university library. He also made a $10 million gift for Sam Wyly Hall, at the University of Michigan
(2000), and is a significant supporter of the Aspen
Writers' Foundation.
In August 2006, the Dallas Morning News reported that Sam and Charles Wyly were under investigation by the SEC, a grand jury in Dallas and a grand jury in New York, regarding their use of potentially illegal offshore tax shelters. Senate investigators allege that the Wyly brothers used the offshore trust
s to buy $30 million worth of artwork, jewelry, furniture and other items for their personal use. The Wyly brothers denied any wrongdoing, and stated that they just followed the advice of their financial advisers. They told the Senate Permanent Investigations subcommittee investigating the offshore tax shelters that they would invoke their Fifth Amendment right against self-incrimination; they were not called to testify.
On July 29, 2010, the Securities and Exchange Commission charged Charles and Sam Wyly with fraud for violating federal securities laws governing ownership and trading of securities by corporate insiders. The Wyly brothers are alleged to have profited by more than $550 million in undisclosed gains. The charges state that this occurred through the trading of stock in public companies that the brothers were serving as board members. They allegedly, through hidden entities located in foreign jurisdictions, concealed their ownership and trading of those securities.
, and joined Pi Kappa Alpha
Fraternity together. The brothers have worked together in a large number of businesses they've owned or run.
In August 2006, Wyly and his third wife, Cheryl, lived in a 8450 square feet (785 m²), $7.48 million house in Highland Park, Texas
. Wyly has six adult children from his first two marriages.
Charles Wyly
Charles Wyly Jr. was an American entrepreneur and businessman, philanthropist, civic leader, and a major contributor to Republican causes and Dallas art projects. This included $20 million to build a performing arts center in Dallas. In 2006, Forbes magazine estimated his net worth at $1 billion...
, was nearly equal in wealth; the two brothers were close with their business affairs, and were often referred to as the "Wyly brothers". Wyly's memoir, 1,000 Dollars and an Idea: Entrepreneur to Billionaire, was published in September 2008.
Early life and education
Wyly was born in Lake ProvidenceLake Providence, Louisiana
Lake Providence is a town in and the parish seat of East Carroll Parish, Louisiana, United States. The population was 5,104 at the 2000 census.-Civil War:...
, the seat of East Carroll Parish in northeastern Louisiana
Louisiana
Louisiana is a state located in the southern region of the United States of America. Its capital is Baton Rouge and largest city is New Orleans. Louisiana is the only state in the U.S. with political subdivisions termed parishes, which are local governments equivalent to counties...
and one of the poorest communities in the United States. He began working at an early age, helping his father, Charles Wyly, Sr., and mother, Flora Wyly, publish a weekly newspaper, the Delhi Dispatch in Delhi
Delhi, Louisiana
Delhi, originally called Deerfield, is a town in Richland Parish, Louisiana, in the United States. As of the 2000 census, the town population was 3,066.-History:...
in Richland Parish
Richland Parish, Louisiana
Richland Parish is a parish located in the U.S. state of Louisiana. The parish seat is Rayville. As of 2010, the population was 20,725.-History:...
. He sold advertising, wrote stories, folded and addressed the finished papers, and cleaned the printing presses.
Following high school, Wyly went to Louisiana Tech University
Louisiana Tech University
Louisiana Tech University, often referred to as Louisiana Tech, LA Tech, or Tech, is a coeducational public research university located in Ruston, Louisiana. Louisiana Tech is designated as a Tier 1 school in the national universities category by the 2012 U.S. News & World Report college rankings...
. He worked his way through college by selling class rings.He and his brother later honored one of their Tech professors, Robert C. Snyder
Robert C. Snyder
Robert Craven Snyder, Sr. , was a professor and professor emeritus of English at Louisiana Tech University in Ruston, the seat of Lincoln Parish in north Louisiana...
, of the English department, with an endowed chair.
Following graduation, Wyly went to the University of Michigan
University of Michigan
The University of Michigan is a public research university located in Ann Arbor, Michigan in the United States. It is the state's oldest university and the flagship campus of the University of Michigan...
's School of Business in Ann Arbor
Ann Arbor, Michigan
Ann Arbor is a city in the U.S. state of Michigan and the county seat of Washtenaw County. The 2010 census places the population at 113,934, making it the sixth largest city in Michigan. The Ann Arbor Metropolitan Statistical Area had a population of 344,791 as of 2010...
, Michigan
Michigan
Michigan is a U.S. state located in the Great Lakes Region of the United States of America. The name Michigan is the French form of the Ojibwa word mishigamaa, meaning "large water" or "large lake"....
, where in 1957 he received a Master of Business Administration
Master of Business Administration
The Master of Business Administration is a :master's degree in business administration, which attracts people from a wide range of academic disciplines. The MBA designation originated in the United States, emerging from the late 19th century as the country industrialized and companies sought out...
degree before such credentials became so recognized. He is one of seventeen Michigan Business School graduates who are billionaires. He was able to attend only because of a new scholarship program, having enrolled as the school's first Paton scholar .
Business career
After receiving his MBA Wyly moved to DallasDallas, Texas
Dallas is the third-largest city in Texas and the ninth-largest in the United States. The Dallas-Fort Worth Metroplex is the largest metropolitan area in the South and fourth-largest metropolitan area in the United States...
to work as a salesman at IBM
IBM
International Business Machines Corporation or IBM is an American multinational technology and consulting corporation headquartered in Armonk, New York, United States. IBM manufactures and sells computer hardware and software, and it offers infrastructure, hosting and consulting services in areas...
's Service Bureau Corporation. Three and a half years later he left IBM to become the area sales manager for Honeywell
Honeywell
Honeywell International, Inc. is a major conglomerate company that produces a variety of consumer products, engineering services, and aerospace systems for a wide variety of customers, from private consumers to major corporations and governments....
, establishing their computer business in Dallas and Oklahoma.
Wyly's wealth comes from businesses that he founded and developed, or purchased and expanded;
- 1963: founded University Computing CompanyUccelUCCEL Corp, previously called University Computing Company was a data processing service bureau on the campus of Southern Methodist University in Dallas, Texas. It was founded by the Wyly brothers in 1963...
(UCC), which provided computer services to engineers, scientists, and researchers with Sun Oil CompanySunocoSunoco Inc. is an American petroleum and petrochemical manufacturer headquartered in Philadelphia, Pennsylvania, United States, formerly known as Sun Company Inc. and Sun Oil Co. ....
, Texas InstrumentsTexas InstrumentsTexas Instruments Inc. , widely known as TI, is an American company based in Dallas, Texas, United States, which develops and commercializes semiconductor and computer technology...
, and others. He began the company with $1,000 and three customers;. The company went public in 1965. By 1968, sales were $60 million; in 1971, they were $125 million.
- 1967: With his brother Charles, bought the restaurant chain Bonanza SteakhousePonderosa/Bonanza SteakhousePonderosa Steakhouse and Bonanza Steakhouse are a chain of buffet/steakhouse restaurants. They are two of the most franchised subsidiaries of Metromedia Restaurant Group....
. He had initially started investing in it with money from the sale of stock in UCC. The company grew to approximately 600 restaurants by 1989, when the two brothers sold it.
- 1968: Acquired Gulf Insurance; at the time, the company had free equity of $52 million and $63 million unrealized capital gains.
- Co-founded Earth Resources Company, an oil refining and silver and gold mining company, served as its Executive Committee Chairman from 1968 to 1980.
- 1970: Purchased Computer Technology, which functioned as the in-house data processing unit for LTV, for $40 million in cash and notes.
- 1972: Sold a computer terminalComputer terminalA computer terminal is an electronic or electromechanical hardware device that is used for entering data into, and displaying data from, a computer or a computing system...
business to Harris-IntertypeHarris CorporationHarris Corporation is a Florida-based international communications equipment company that produces wireless equipment, electronic systems, and both terrestrial and spaceborne antennas for use in the government, defense, and commercial sectors. It is also the largest private-sector employer in...
, writing off $32 million in investments.
- 1973: Divided UCC into four companies, including Datran, which began construction of a nationwide system of microwave towers to transmit data among 27 American cities in direct competition with AT&TAT&TAT&T Inc. is an American multinational telecommunications corporation headquartered in Whitacre Tower, Dallas, Texas, United States. It is the largest provider of mobile telephony and fixed telephony in the United States, and is also a provider of broadband and subscription television services...
.
- 1981: Co-founded Sterling SoftwareSterling SoftwareSterling Software was an American software company founded in Dallas, Texas in 1981 by Sterling Williams and brothers Sam and Charles Wyly. The company was acquired by Computer Associates International in 2000 in a stock-for-stock transaction worth $3.3 billion.Computer Associates sold Sterling...
. The company was sold to Computer Associates in 2000 for $4 billion.
- 1982: Bought controlling interest in an arts-and-crafts chain MichaelsMichaelsMichaels is an arts and crafts retail chain. It currently operates more than 1040 Michaels Arts and Crafts Stores located in 49 U.S. states and in Canada. The company owns and operates the Aaron Brothers retail chain which consists of more than 140 stores...
; the company's revenues grew from $10 million at the time of purchase to $1.24 billion by 1996. In July 2006, Bain CapitalBain CapitalBain Capital LLC is a Boston-based private equity firm founded in 1984 by partners from the consulting firm Bain & Company. Originally conceived as an early-stage, growth-oriented investment fund, Bain Capital today manages approximately $65 billion in assets, and its strategies include private...
and the Blackstone GroupBlackstone GroupThe Blackstone Group L.P. is an American-based alternative asset management and financial services company that specializes in private equity, real estate, and credit and marketable alternative investment strategies, as well as financial advisory services, such as mergers and acquisitions ,...
purchased the company for $6 billion.
- 1986: Purchased Frost Bros.Frost Bros.Frost Bros. was a high-fashion retail chain based in San Antonio, Texas. The retailer opened its first store in 1917 at 217 E. Houston Street in downtown San Antonio. Frost Bros. was known for quality personal service, including name recognition, purchase preferences, and personal shoppers...
, a specialty retail chain, from Manhattan Industries. After failing to reorganize while operating under bankruptcy protection, the company was liquidated in mid-1989.
- In 1990, co-founded hedge fund Maverick Capital, which by 2003 had about $8 billion in assets. Beginning in 1993, his son Evan, a Maverick co-founder, and money manager Lee S. Ainslie IIILee AinslieLee S. Ainslie III is the head of hedge fund Maverick Capital, which in 1993 he helped form at the invitation of billionaire Sam Wyly. Prior to joining Maverick, he worked at Julian Robertson's Tiger Management Corp. He holds a bachelor's degree from the University of Virginia and an MBA from the...
managed the fund.
- As of 2006, Wyly was the largest stockholder of clean-energy producer Green Mountain EnergyGreen Mountain EnergyGreen Mountain Energy is a United States company that offers clean electricity products, and carbon offsets to residential and commercial customers.-History:...
.
- In 2006 Wyly also was the largest investor in the online social networking company Zaadz.com at an estimated 1.5m.
- In March 2007, Forbes magazine estimated Wyly's net worth to be $1.1 billion. In September 2006, Forbes ranked him as the 354th wealthiest American.
Politics
In March 2007, commenting on the purchase of a local bookstore by Wyly and his wife Cheryl, the Aspen Times noted that the Wyly family "has been known not only for its philanthropic efforts, but also its large contributions to conservative political campaigns and candidates." Wyly and his brother Charles have personally given about $10 million to Republican causes and candidates between the early 1970s and 2006, they say; both are Bush PioneerBush Pioneer
Bush Pioneers are people who gathered $100,000 for George W. Bush's 2000 or 2004 presidential campaign. Two new levels, Bush Rangers and Super Rangers, were bestowed upon supporters who gathered $200,000+ or $300,000+, respectively, for the 2004 campaign, after the 2002 McCain–Feingold campaign...
s.
In 2000, Sam Wyly contributed $2.5 million to a group called "Republicans for Clean Air", which ran ads praising George W. Bush
George W. Bush
George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....
's environmental record and criticizing that of John McCain
John McCain
John Sidney McCain III is the senior United States Senator from Arizona. He was the Republican nominee for president in the 2008 United States election....
. The ads ran in New York, Ohio, and California in advance of early March primaries, at a time when Bush and McCain were locked in a tight struggle for the Republican presidential nomination. It initially was unclear who was behind the group or who paid for the ads until Wyly stepped forward to take the credit.
In 2004, Wyly also donated $20,000 to the Swift Boat campaign that raised questions about Sen. John Kerry's military record in Vietnam, helping scuttle Kerry's challenge to Bush. Wyly said in 2008 that he was not leaning toward either Republican John McCain or Democrat Barack Obama in that year's presidential campaign, and would not get involved in the race.
Philanthropy
Wyly and his late brother Charles spent more than ninety million dollars on a wide range of charities. In 1968, he set up the Sam Wyly Foundation to help minority businessmen. He also helped to start an educational TV channel in Dallas.With Charles, he funded the Charles Wyly Sr. Tower of Learning on the campus of Louisiana Tech, in memory of their father. The building includes a computer center and the university library. He also made a $10 million gift for Sam Wyly Hall, at the University of Michigan
University of Michigan
The University of Michigan is a public research university located in Ann Arbor, Michigan in the United States. It is the state's oldest university and the flagship campus of the University of Michigan...
(2000), and is a significant supporter of the Aspen
Aspen
Populus section Populus, of the Populus genus, includes the aspen trees and the white poplar Populus alba. The five typical aspens are all native to cold regions with cool summers, in the north of the Northern Hemisphere, extending south at high altitudes in the mountains. The White Poplar, by...
Writers' Foundation.
Controversy
In 1979, Wyly settled Securities and Exchange Commission charges that he made undisclosed payments to associates to buy up company bonds as part of a plan to stave off bankruptcy. He settled without acknowledging any wrongdoing.In August 2006, the Dallas Morning News reported that Sam and Charles Wyly were under investigation by the SEC, a grand jury in Dallas and a grand jury in New York, regarding their use of potentially illegal offshore tax shelters. Senate investigators allege that the Wyly brothers used the offshore trust
Offshore trust
An offshore trust is simply a conventional trust that is formed under the laws of an offshore jurisdiction.Generally offshore trusts are similar in nature and effect to their onshore counterparts; they involve a settlor transferring assets on the trustees to manage for the benefit of a person or...
s to buy $30 million worth of artwork, jewelry, furniture and other items for their personal use. The Wyly brothers denied any wrongdoing, and stated that they just followed the advice of their financial advisers. They told the Senate Permanent Investigations subcommittee investigating the offshore tax shelters that they would invoke their Fifth Amendment right against self-incrimination; they were not called to testify.
On July 29, 2010, the Securities and Exchange Commission charged Charles and Sam Wyly with fraud for violating federal securities laws governing ownership and trading of securities by corporate insiders. The Wyly brothers are alleged to have profited by more than $550 million in undisclosed gains. The charges state that this occurred through the trading of stock in public companies that the brothers were serving as board members. They allegedly, through hidden entities located in foreign jurisdictions, concealed their ownership and trading of those securities.
Personal
Wyly and his brother Charles, older by a year, were close all their life. They played high school football, attended Louisiana Tech UniversityLouisiana Tech University
Louisiana Tech University, often referred to as Louisiana Tech, LA Tech, or Tech, is a coeducational public research university located in Ruston, Louisiana. Louisiana Tech is designated as a Tier 1 school in the national universities category by the 2012 U.S. News & World Report college rankings...
, and joined Pi Kappa Alpha
Pi Kappa Alpha
Pi Kappa Alpha is a Greek social fraternity with over 230 chapters and colonies and over 250,000 lifetime initiates in the United States and Canada.-History:...
Fraternity together. The brothers have worked together in a large number of businesses they've owned or run.
In August 2006, Wyly and his third wife, Cheryl, lived in a 8450 square feet (785 m²), $7.48 million house in Highland Park, Texas
Highland Park, Texas
Highland Park is a town in central Dallas County, Texas, United States. The population was 8,842 at the 2000 census. Located between the Dallas North Tollway and U.S. Route 75 , four miles north of downtown Dallas....
. Wyly has six adult children from his first two marriages.
External links
- Official website of Sam and Charles Wyly
- Oral history interview with Sam Wyly, Charles Babbage InstituteCharles Babbage InstituteThe Charles Babbage Institute is a research center at the University of Minnesota specializing in the history of information technology, particularly the history since 1935 of digital computing, programming/software, and computer networking....
, University of Minnesota, by David Allison, December 6, 2002. Wyly recounts his childhood and education prior to going to work for IBM’s Service Bureau Corporation, and then joining Honeywell as an area sales manager. He discusses how he left Honeywell to form University Computer CorporationUccelUCCEL Corp, previously called University Computing Company was a data processing service bureau on the campus of Southern Methodist University in Dallas, Texas. It was founded by the Wyly brothers in 1963...
(UCC), a software services business. Wyly explains his growing focus on computing and telecommunications, his formation of Datran, and his unsuccessful attempt to acquire Western UnionWestern UnionThe Western Union Company is a financial services and communications company based in the United States. Its North American headquarters is in Englewood, Colorado. Up until 2006, Western Union was the best-known U.S...
. Much of the interview focuses on ongoing developments at UCC, the eventual sale of this firm to Computer Associates, his formation of Sterling SoftwareSterling SoftwareSterling Software was an American software company founded in Dallas, Texas in 1981 by Sterling Williams and brothers Sam and Charles Wyly. The company was acquired by Computer Associates International in 2000 in a stock-for-stock transaction worth $3.3 billion.Computer Associates sold Sterling...
, its acquisition of Informatics, the sale of Sterling, and his ideas on the future of information technology.