Paul Alec Bilzerian (born 1950) is a specialist takeover of an American company of Armenian descent. Convicted of securities and violations of tax laws relating to a failed takeover attempt from various companies in 1980, Bilzerian served a prison term and was also ordered to eliminate his profits, leading him to bankruptcy and protracted disputes with the Securities and Exchange Commission. Bilzerian has spent the past 28 years maintaining that he is factually and legally innocent.
Video Paul Bilzerian
Careers
One of Bilzerian's first business deals was an investment in the Tampa Bay area radio station, WPLP, which he co-developed with two Army colleagues from the Vietnam War who had experience in the broadcast industry. However, the station was performing poorly, and after its bankruptcy in 1980 disputes broke out between Bilzerian and two of his fellow investors, which led to his lawsuit against them. Instead, he is more successful in his real estate investment. In 1984, he moved to Sacramento, California where his father-in-law and other business associates lived.
Incorrect company fetch
While living in Sacramento, in 1985 Bilzerian began two of its first takeover attempts, one of the clothing manufacturers in New York Cluett Peabody & amp; The company, and the Pittsburgh construction company H. H. Robertson. Bilzerian raised his bid for Clifett Peabody's remaining 76% in October. In response, Cluett Peabody's board of directors adopted the provisions of poison pills, making them publicly endorsed by Bilzerian's allusions. Cluett Peabody finally accepted a competitive merger bid by WestPoint Pepperell (now WestPoint Home) for $ 41 per share (in cash or equivalent to WestPoint Pepperell common stock); Bilzerian and his fellow investors agreed separately to sell their shares to WestPoint Pepperell for $ 39.45 per share.
Bilzerian moved back to Florida in 1986. That July he and his investor counterparts William and Earle I. Mack (children of the New Jersey real estate developer H. Bert Mack) launched a takeover offer against Hammermill Paper Company, buying about 3.3 million Hammermill shares at an average price of about $ 47 per share, and then offered $ 900 million ($ 52 per share) to buy the rest of the company. Bilzerian's offer was eventually rejected when Hammermill was sold to International Paper, not at $ 64.50 per share, but Bilzerian and his fellow investors still profited nearly $ 60 million from the deal.
Singer Corporation
In 1985, Bilzerian started what would ultimately be a successful takeover attempt against Singer Corporation, a manufacturer of defense electronics. In October 1987, it was revealed through a disclosure mandated by the SEC that a group of Bilzerian-led investors had bought Singer's 2.1 million shares in the previous two months. The singer seems an unlikely target for a takeover: early reports cast doubt on the idea that the government will allow the takeover of a defense contractor, and the company has moved its headquarters from Connecticut to the New Jersey feuds in an attempt to fend off its earlier takeover by T. Boone Pickens. In January 1988, Pickens provided $ 150 million in additional financing, allowing Singer's deal to be passed.
Bilzerian's unexpected success is caused by several factors. Singer Chairman Joseph B. Flavin had died in early October, leaving the company with no strong leadership to resist the takeover attempt. The Black Monday crashes less than two weeks later scaring off competing investors. Finally, the Omnibus Budget Reconciliation Act of 1987 included provisions to ban the sale of assets in certain businesses acquired to be treated as capital gains for tax purposes, making future takeover bids less attractive; however, a takeover offer like Bilzerian which has been circulated on the date of the Act is exempt from this tax increase.
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Stock parking case
High-profile Bilzerian takeover attempts encourage the SEC to check its offerings, particularly on whether the investment groups he controls have hidden the extent of their ownership in the companies they are targeting for takeover. In May 1988, the SEC began an investigation of Edward J. DeBartolo, Sr. to determine whether DeBartolo has illegally assisted Bilzerian takeover efforts through "stock parking", in which one party purchased shares in coordination with the other to keep legal ownership. separated and avoid the ownership of either party beyond the disclosure threshold. Then, in December 1988, Rudy Giuliani announced that Bilzerian had been indicted in Manhattan by a federal grand jury on charges including securities and tax fraud. Allegations related to his takeover attempt against Cluett Peabody, H. H. Robinson, Armco, and Hammermill.
In January 1989, Bilzerian pleaded not guilty to charges in the midst of a growing public controversy and demanded a speedy trial to clear his name. There are, in general, two different camps of opinion about Bilzerian action. Most societies have a negative view of the general takeover of companies and see Bilzerian activities as "greenmail", benefiting by companies that cheat to believe they are facing hostile takeover attempts and frighten them into buying their stock from him for a high price. However, others see Bilzerian innocent but make a profit in a sincere but failed takeover that benefits all investors. In an article in New York magazine Christopher Byron questioned the whole basis of the case against Bilzerian, describing it as being driven by the "Puritan jealousies." He further states that the Justice Department's primary motivation for this case is not the prosecution of mistakes, but rather the need to justify previously unpopular bargains with Boyd Jeffries of Jefferies & The company, which will see Jefferies avoid jail time altogether in exchange for an opportunity to "drag some titled names through the mud".
After two days of deliberation in June, the jury found Bilzerian guilty of nine charges including conspiracy, making false statements, and securities as well as violations of tax law. In September, Judge Robert Joseph Ward sentenced Bilzerian to four years in prison and a $ 1.5 million fine. Bilzerian was allowed to remain free pending an appeal. Bilzerian's appeal came before the Court of Appeals for the Second Circuit, which in January 1991 ruled against it, found no merit in his argument that his trial was unfair. The penalty is set to begin in December 1991 in the now already closed Federal Prison Jail, Eglin at Eglin Air Force Base, Florida. Bilzerian was released from prison in January 1993 to serve his sentence under house arrest. Bilzerian also argued that the Court of Appeal for the Second Circuit refused to agree on two US Supreme Court rulings that agreed that Bilzerian conviction was reversed. After Bilzerian's release from prison, he later became president of a Utah-based software company called Cimetrix. However, in 2002, the government seized the ownership of Bilzerian in Cimetrix and ultimately pushed the company from several years of high sales growth and profitability to the brink of bankruptcy.
Civil settings and bankruptcy
Along with the criminal charges, the SEC announced in May 1989 that he would file a civil lawsuit against Bilzerian in an attempt to force him to take advantage of the takeover. In 1993, a federal judge ruled in favor of the SEC and ordered Bilzerian to lift $ 33.1 million in profits, plus interest. The total amount to be disgorgored is $ 62 million. In January 1994, Bilzerian also filed an appeal against a civil ruling in the Court of Appeals for the District of Columbia. However, in July the court rejected his civil appeal as well.
Due to the size of the fine against him, Bilzerian first filed for bankruptcy in 1991. Bilzerian emerged from a bankruptcy that had paid about $ 400,000 in debt settlement over $ 300 million. In 1999 he tried to sell his house in the prestigious Avila neighborhood in Tampa, Florida, and at one point even Mike Tyson was reportedly interested in buying. He filed for bankruptcy again in January 2001, declaring his assets of $ 15,805 against $ 140 million in debt. Under Florida Bankruptcy Law, the value of the primary residence is protected from creditors. The SEC alleges that Bilzerian used bankruptcy as a tactic to block creditors from figuring out the true value of its assets. Later that month, a federal judge ordered Bilzerian jailed for court humiliation for his failure to reveal his assets.
On June 11, 2001, when Bilzerian was imprisoned, FBI agents raided his family home with sealed warrant power and seized Beretta's computers, files and guns. The attack appears to be related to the SEC's opposition that Bilzerian hides its asset ownership during the bankruptcy process by transferring it to trust and shell companies. Bilzerian was released from prison in January 2002 under an agreement in which his wife Terri Steffen would sell the residence and share the proceeds with the SEC. Bilzerian was very critical of the deal, describing him as the SEC who used him "as a hostage to extort money" from his wife. In May 2004, Steffen sold his residence for $ 2.55 million for a partnership controlled by a Belgian entrepreneur; The SEC lawyers agreed an incredibly low price. According to court documents filed in 2006, Steffen's parents bought 99% interest in the partnership three weeks later.
Education and family
Bilzerian was born in Miami, Florida, but grew up in Worcester, Massachusetts. He is an Armenian American. His father, a civil servant, and his mother subsequently divorced, causing the troubled years for the Bilzerians; he later described himself as a "bad boy". Called to his principal's office at high school one day in 1968 for violating the dress code in blue jeans, Bilzerian impulsively answered by dropping out of school. However, after serving in the Vietnam War and getting the Vietnamese Gallantry Salon, Bronze Star Medal, and Army Award Medal, he changed his life, earned a Bachelor of Arts degree with honors from Stanford University in 1975. Bilzerian entered the same Harvard Business School year. He was unsure about his choice to attend, after offering admissions to some law schools to enroll in HBS. After his graduation, Bilzerian married Stanford's Stanford classmate Terri Steffen in 1978, and moved with him to St. Petersburg, Florida.
Bilzerian had two sons, Adam and Dan Bilzerian. Adam attended Gaither High School, where he represented his school in tennis. Angered by the government's treatment of his father, Adam left his dream to become a Green Army Beret. After graduating from Vanderbilt University, he moved to Saint Kitts and Nevis in 2007 and became a citizen there, releasing US citizenship in the process. Both Adam and Dan went on to career as professional poker players; Norman Chad dubbed them "Flying Bilzerian Brothers" for their performance in the World Series of Poker 2009. Adam also wrote a book about his experiences, which Book Book of Midwest's Book Book Small Press is well reviewed as "a list of complaints which is good with the power that exists in America, makes for reading and through ".
In June 2014, a Bloomberg News report falsely claimed that Paul Bilzerian had become one of the licensed service providers who processed the same Saint Kitts and Nevis citizenship-by-investment application that his son used. The report also states that Bilzerian has processed citizenship-by-investment applications for Bitcoin Roger Ver investors, and that the two men have launched a website through which customers can use Bitcoin to pay fees and real estate. buying in a citizenship-by-investment program. The Government of Saint Kitts and Nevis responded in a statement the following week that Bitcoin was not an acceptable method of payment to participate in the program.
References
Source of the article : Wikipedia
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