‘I lost more money than anybody in the history of capitalism!’: Remembering Ted Turner
Ted Turner, who died this Wednesday at 87did not do something midway. In October of 2006, I obtained to spend a memorable night alongside Ted Turner at the opening of his Ted’s Montana Grill Restaurant in midtown Manhattan. I used to be invited as a “plus-one” by shut pal and fellow Fortune author Pattie Sellers, who’d profiled Turner for the journal, and therefore scored an invitation. (Pattie was the pioneering journalist in highlighting girls’s achievements as founder of the Fortune “Most Powerful Women in Business” checklist and our famend annual convention by that title.) The eatery occurred to be located an elevator journey from our sixteenth ground workplaces, on the floor ground of the Time & Life Building. Pattie and I walked from the art-deco fashion foyer into an 18th-century saloon-style fantasia that includes all method of bison recipes from pot roast to quick ribs to steak frites. Turner owned one of the world’s largest bison herds and championed the fare these bearded beasts supplied as a wholesome and engaging different to beef, whereas boasting his Grills supplied an oasis of “Big Sky sustainability”—plastic straws, no means—amid the canyon of skyscrapers.
When we arrived, Turner was the solely different particular person in the restaurant. He’d performed an enormous position in constructing the Time Warner media empire I labored for (Fortune belonged to at least one of its largest divisions, magazine-maker Time, Inc.), and I’d all the time puzzled about the circumstances concerning his sudden, acrimonious departure 5 years earlier. To recap the primary define: Turner had bought Turner Broadcasting, proprietor of CNN, TBS, TNT and the Cartoon Network, to Time Warner in 1996, pocketing round $7.5 billion in the acquirer’s inventory. But in 2001, following Time Warner’s sale to AOL, CEO Jerry Levin successfully fired Turner by stripping him of all administration authority. Here’s what puzzled me: When Turner bought his creation to Time Warner, he amassed round 11% of its shares. But to get the huge payout, this stressed entrepreneur reluctantly accepted extreme limitations on his energy, not less than for some time: The phrases imposed a so-called “standstill agreement” that prevented Turner from taking any hostile motion towards the firm, banned him from buying more inventory, and primarily required the mercurial maverick to again the Levin regime in all huge issues. The straight-jacket was so tight that Turner even tacitly endorsed the AOL tie-up.
Prior to the AOL buy, Turner served as Vice Chairman and oversaw his former networks. But Ted Turner did not need to be a “Vice” something. So I’ve posed a giant risk to Levin. After a couple of years, Turner might most likely escape his standstill by quitting the board, and press ax Levin and ascend to CEO. After all, as soon as launched, he’d wield immense energy as by far the Time Warner’s largest shareholder at over 10%.
The Levin-orchestrated AOL transaction, nonetheless, successfully neutered Turner. It launched a blizzard of new shares that lowered its possession in the mixed enterprise by over half, to roughly 4%.
Besides Pattie and myself, the solely different particular person to point out in the first hour or so was Ted’s actor pal Timothy Hutton. After they chatted briefly, I obtained an opportunity to ask Ted about whether or not the Machiavellian maneuvering I suspected truly triggered his ouster: “Do you think that Jerry Levin did the AOL deal, at least in part, to dilute you and ensure you couldn’t marshal your huge shareholder position to replace him as CEO?”
Drawled Ted Turner, “I don’t know if it was the main reason, but I do know that it was on his mind.”
Turner apparently believed that Levin thought he was scoring double coup: Getting an enormous premium from AOL for Time Warner shares en path to making a mixed dot-com-old media juggernaut that might drive the worth larger from there—and in a single stroke, additionally sideline his chief rival.
As it turned out, shares of the new AOL Time Warner started tanking just about on announcement of the merger. Turner was so incensed over getting canned and the means the combo was unraveling that he dumped practically all of his Time Warner inventory in 2003, after the shares had cratered virtually 80%. He collected roughly $3 billion for a stake that in 1999, pre-AOL, was value round $11 billion.
Turner volunteered one other assertion at Montana Grill’s New York debut that night: “I lost more money than anyone in the history of capitalism!” he advised me. Ted Turner wished the world to know that he was all the time Thinking Big, whether or not he was pursuing the America’s Cup on the seas, remodeling journalism through birthing the first 24-hour information platform at CNN, or in all chance, aiming to helm the world’s largest media conglomerate at Time Warner. It was half of his outrageous allure that this nice promoter had no qualms in broadcasting that the uncommon time he lost, nobody lost larger.
