| WEALTHOVER GROUP |
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Non
Bank Financial Services | ||||||||||
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Corporate
Doctors to small and midsize companies | ||||||||||
| ...Since 1966 |
| Employee
Buyouts
[One Example] During 6 decades of the 20th century US Television broadcasting was divided between three networks, NBC, CBS and ABC; the latter having the smallest market share. ABC had been spun off from NBC in a 40' s court ruling. The founder EJ Noble was replaced by L Goldenson in a Wall Street orchestrated unfriendly takeover. More popular in the press than inside the company Goldenson just kept ABC profitable through its acquisition of a chain of cinemas while the broadcasting business foundered in red ink, its creative potential unfulfilled. wealthover were approached by a delegation of vice presidents, employee reps. and the Noble heirs, who still owned 10% of the by then NYSE listed company The group had tried before to oust Goldenson, but he used the company purse to fund public relations campaigns which always had him at the centre .By such means he could count |
on a simple majority in a stockholder showdown. The only way the employees could buy enough shares themselves would be to borrow money, and this would inevitably come to the attention of the boss:they'd probably be dismissed. Creative departments were scheduled to be shrunk by Goldenson in order to meet earnings forecasts. We called the project "Operation Designated Hitters". In a country where there are always willing patriots who for a profit will help move a national icon in a positive direction. Those who qualified agreed to sell all ABC shares they acquired to company's employees at market. And in the meantime they would give proxies so the employees could vote in their candidate to replace Goldenson, Roone Arledge, (then Vice President of ABC Sports). We soon had Meyer Schein (Crown Zellerbach/St. Frances Hotel), Pat Frawley (Schick Eversharp), Eli Black (United Fruit/AMK) & HL Hunt (Hunt Oil) shorting ABC stock. During the four months | before ABC's annual meeting the shares had dropped from $67 to $62, and the designated hitters (shorters-turned-buyers) had managed to acquire enough shares to, along with the Noble shares, carry the day in the coming proxy fight. [Thus ended our contractually agreed assignment.] Postscript: Goldenson, realised what was happening, got ABC lobbyists to move the FCC which threatened to pull ABC's broadcasting cert.if the network came under right wing influence - the press went after Hunt. So he and Frawley neither voted nor gave proxies on their shares. [Murdock under radar 20 years later?] Arliedge became President of ABC News, and Goldenson remained CEO. In 1987 Berkshire got a minnow (Cap Cities) to swallow ABC, then in 1996 Disney acquired Cap Cities/ABC. Meyer Schein kept his promise to help workers leverage his ABC shares. |
