• Joseph Lewis, the British billionaire who built up his stake in Bear Stearns last summer, lost about $1.6 billion this past weekend, approximately half of his entire fortune. Bear's biggest investor, Dallas-based money manager James Barrow, whose firm had a 9.95 percent stake, also lost big — at least $750 million. Activist shareholder Bruce Sherman and departed CEO James Cayne each lost big on their 5 percent stakes, although Cayne might not care so much: He just closed on a $28.24 million Plaza pad and spent late last week playing bridge in a tournament in Detroit. [Bloomberg]
• Meanwhile, Bear's "fire sale" is spreading like wildfire down the street, singing Lehman Brothers, among other top banks. [DealBook/NYT]
• And Barry Diller's IAC is "sputtering." [NYT]
Last October, when Barry Diller picked up The Wall Street Journal and saw his business partner in IAC, Liberty Media founder John Malone, sniping that although once there was a Barry Diller premium on Wall Street, "Today you could argue there is a Barry discount," among other things, he felt not unlike Minnie Driver when she found out Matt Damon was breaking up with her by hearing it on Oprah. "How could they be that mean?" Diller whined in Delaware chancery court yesterday. "How could they be that hostile?" For two weeks, he sat around, "waiting for the phone to ring," he said. "I expected John Malone to call me and apologize." But the call never came. Diller's testimony is the last in the trial that will determine the fate of IAC, and his statements yesterday underscore the fact that while Diller, Malone, and Malone's deputy boy toy Gregory Maffei may act as though their fight is over what's best for shareholders, this battle is personal, and that whatever the outcome of the trial, the ending to the IAC story was written long ago. Specifically, in those dark, cold months between the fall and Christmas. It was December 21, when Malone finally approached Diller, who told him: "You lost me."
Scenes From a Marriage [Portfolio]
Well, it's time. With heads bowed and hearts, perhaps, heavy, longtime partners Barry Diller and John Malone will appear in Delaware chancery court today, where a judge will help the two moguls, who have been financially intertwined for the past twenty years, make up or break up. The court visit comes after a lengthy and sometimes ugly public battle, during which Malone maligned Diller's lavish lifestyle and Diller called Malone "crazy," among other things. For two well-regarded, exceedingly clever businessmen, it has been something of an undignified spectacle. Why, many are asking, couldn't they just work it out?
Many of you know celebrity astrologer Susan Miller as the uncannily accurate predictor of your fate. You're in good company: She's got A-listers like Kirsten Dunst and Orlando Bloom paying her to do their charts and gets fifteen million page views a month on her Website, Astrologyzone. She's asked to analyze the stars for actors, musicians, and starlets all the time — but when we got the chance to talk with her, we wanted to know what the future holds for a group of guys even nearer and dearer to our heart. Guys like embattled IAC CEO Barry Diller, Blackstone CEO Steven Schwarzman, ousted Citigroup CEO Chuck Prince, and Merrill Lynch newbie John Thain. After all, these people have much more power to wreak havoc in our lives if the stars choose not to shine on them. After the jump, read Miller's uncannily prescient analysis (it would be more precise if she knew the times of day they were born) and learn what warnings these four financial powerhouses need to heed if they want to come out of 2008 on top.
It's a Barry Diller pile on! After his IAC/InterActiveCorp posted large losses and disappointing fourth-quarter results yesterday (largely due to the effects the subprime market had on its mortgage site, LendingTree), the embattled CEO, currently locked in a legal battle with his backer, Liberty Media CEO John Malone, who has been trying to oust him, is now taking a beating in the press. “It just seems like Barry Diller doesn’t have enough fingers to plug the holes in this bucket,” RBC Capital Markets analyst Jordan Rohan told the Times. “It seems like a company that’s always firing on only one or two cylinders.”
“There's probably no momentum to maintain Barry Diller in his current role,” Sanford C. Bernstein analyst Jeffrey Lindsay told Bloomberg. And Forbes suggests that John Malone just go ahead and “close the coffin” on Diller's reign at the company.
It's a rumble! Yesterday Liberty Corp John Malone took steps to seize control of IAC/InterActiveCorp from IAC chairman Barry Diller, in a move that marked an "escalation of hostilities" between Diller and his longtime backer Malone. That's how The Wall Street Journal put it, but to us it sounds more like nuclear war. Malone signaled he was plotting a coup in IAC — a $7 billion conglomerate that includes the Home Shopping Network and Ticketmaster — when he upped his stake earlier this month, and last week, the two filed suit against each other in Delaware Chancery Court. Now, Malone is attempting to get around a proxy agreement that guarantees Diller a voting stake in IAC, and eject him from the company for good, citing Diller's "misconduct" and criticizing the giant paychecks he writes himself. "I am beginning to think these people are insane," Diller said in a statement. "Everything they cite is hogwash." Business Week suggests that Malone's Machiavellian maneuvering has less to do with his concern for shareholders and more to do with the fact that he is trying to get a cut-rate deal for the Home Shopping Network, so that he may merge it with Liberty's QVC, creating one monster television and online outlet for porcelain vases and zirconium jewelry. But is their highly public battle only going to scorch the earth?
Malone Moves to Oust Diller [Business Week]
Liberty Media Moves to Take IAC From Diller [WSJ]
Earlier: Barry Diller and John Malone Kick Each Other Under the Table; Barry Diller and John Malone Get in the Ring
Barry Diller denies that Frank Gehry built him an invader-proof, bullet-proof bunker in the bathroom of his office at the new IAC headquarters. So Pamela and Kid didn't break up over Borat — they broke up because Pam partied too much and left the kids home with Kid (and maybe lied about her miscarriage). New crotch-flashing best friends Paris Hilton and Britney Spears will host the Billboard Music Awards Monday in Vegas. Rush & Molloy "breaks" the news that the "raisin face" Nicole Richie was referring to on her blog is Rachel Zoe, which, like, everyone knew two days ago. Ed Koch lost his pants at an airport in Portugal. Steve Schirripa accidentally head-butted James Gandolfini on the set of The Sopranos. Bobby Kennedy Jr. had dinner with his sister's husband's ex-wife. The publishers of InStyle want the magazine's weddings editor to make things a little more highbrow. Snoop Dogg filed a $2 million lawsuit against his record label for royalties owed; TomKat spent $4.75 million for a cottage in London. Robert Altman tattooed dogs for a living before he made movies. Publicist Dan Klores has a movie in Sundance this year, his third in five years. Some people laughed at a screening for a new comedy about Adolph Hitler, and some people didn't. (And yes, the director's Jewish.) Cindy Adams speculates (twice!) that ABC's Primetime co-anchor John Quinones will take over Ed Bradley's vacant seat at 60 Minutes. Liz Smith reminds us that Rudy and Judy Giuliani are truly, madly, deeply in love. Lillo Brancato, of A Bronx Tale fame, is in solitary confinement at Rikers Island for a third time (this time for heroin). And the Post scolds the Daily News for calling a kettle black.
Very Short List is the latest entry in the daily-email-tip-sheet sector, yet another competitor for DailyCandy (for former sorority girls), Thrillist (for former frat boys), UrbanDaddy (for slightly more refined former frat boys), and the like. What's the VSL* niche? Sophistication. It "points to excellent entertainment, media, and other cultural things you may not know about because they haven't been hyped to within an inch of their lives," the introductory e-mail explained. Herewith, four of those rarefied bits of undiscovered genius the cultural spelunkers at VSL have been diligent enough to suss out in the six workdays since the service's public launch:
• The Hill, a reality show airing on the Sundance Channel.
• Preston Struges: The Filmmaker's Collection, seven classic films released from 1940 to 1944.
• Police Squad, a television show from 1982.
• The Conformist, a Bertolucci film from 1970.
We can't tell you how pleased we are they're letting us in on these secrets.
* VSL's creators include New York contributors Kurt Andersen and Simon Dumenco, plus several other guys we know.
Very Short List [Official site]