Posted on 12/12/2002 12:09:31 PM PST by fm1
Bernie Ebbers built a personal empire the way he built WorldCom: with bold deals, big gambles and costly mistakes.
Over 20 years, while Ebbers turned WorldCom into the USA's No. 2 long-distance phone company, he also made a string of personal investments that engaged his passions. He bought Canada's biggest ranch and stakes in two farms, a minor league hockey team, a trucking company, an all-terrain-vehicle dealership, a lumberyard, enough acres of timberland to cover half the state of Rhode Island and a yacht company. He also expanded his original hotel chain.
Ebbers viewed his outside ventures with pride. With childlike excitement, he once gathered top WorldCom officials in a conference room for a slide show of his ranch. He loved hanging around the shipyard and riding tractors on his farms. He spoke animatedly about his hockey team. He even made WorldCom executives sit through discussions of hotel occupancy rates.
Today, the former billionaire is in danger of losing many of his assets — just as he lost control of WorldCom when he was ousted as CEO in April. WorldCom is negotiating with Ebbers to unload his ranch and his stakes in the timber properties and lumberyard, people close to the negotiations say, to cover $408 million in loans from the telecom giant. WorldCom has already claimed Ebbers' yacht-building company.
WorldCom is unlikely to recover all of its loans, a USA TODAY investigation shows. Many of Ebbers' private ventures have stumbled just like WorldCom. While Ebbers has said little publicly about his non-WorldCom ventures, what's happened to them sheds light on the management style that also imperiled WorldCom and on one of the 1990s' most influential business figures.
At his day job, Ebbers helped fuel the telecom boom of the 1990s. He built WorldCom into a titan and rose to No. 174 on Forbes' list of richest Americans. It was 1999, and he was worth an estimated $1.4 billion.
Likewise, life was good at Ebbers Inc.
"We have all the money in the world," ranch manager Joe Gardner boasted to land negotiators from a nearby Indian tribe after Ebbers bought the British Columbia ranch in 1998. In Savannah, Ga., Thomas Conboy, who got up to $25 million from Ebbers to turn a military mine-sweeping company, Intermarine, into a yacht builder, would refer to Ebbers as "the bank," former employees say.
Now, Ebbers is best known for presiding over one of the biggest corporate meltdowns in history.
Less than three months after his ouster, WorldCom filed the biggest bankruptcy case ever and disclosed the first part of what would grow to a $9 billion accounting scandal. Its collapse has cost investors and creditors tens of billions of dollars. While investigators and attorneys for shareholders have yet to pinpoint Ebbers' role, if any, in the accounting scandal, they are eyeing his personal ventures for wrongdoing and restitution. Ebbers could not be reached for this story. His lawyer declined to comment.
(Excerpt) Read more at usatoday.com ...
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