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The article presents a discussion between leveraged-buyout mogul Ronald Perelman and his corporate raider father, Raymond. Topics covered include Raymond's willingness to accommodate Ron's childhood interest in business, Raymond's start in business, Ron's decision to quit his father's firm after the latter refused to make him company president, circumstances surrounding Ronald's purchase of holding company MacAndrews & Forbes, and the importance of Judaism in the two men's lives.

The article discusses the successes of the Danaher Corp. and founders Mitch and Steve Rales. Danaher has produced high level yieldings for its stockholders constantly over the past 20 years under the radar of the media. Part of the success is because of the management strategies that Danaher implements on their newly acquired companies. The author also attributes the company's success to their low key operations.

The article profiles corporate raiders, leveraged-buyout artists, and shareholder activists on the 24th annual edition of The Forbes 400 list of successful people, including billionaires Carl Icahn, Philip Anschutz, Ronald Perelman, Eli Broad, H. Ross Perot, David Murdock, Lester Crown, Henry Hillman, and Others. Icahn is a corporate raider up to old tricks with the purchase of a small stake in Time Warner; trying to strong-arm the media giant into dumping publishing assets and buying back $20 billion in stock. Anschutz runs a wide-ranging empire in telecommunications, sports, and entertainment. Broad became one of the nation's biggest home builders, supplying parents of baby boomers with affordable housing.

The article focuses on Ronald Perelman, a corporate raider during the 1980s. Perelman, 62, says the string of setbacks, especially Marvel, marked the lowest point of his long career, which spans 27 years and 38 big deals. He still winces from the fallout over the divorce in 1997 from his third wife, Patricia Duff. Along the way the size of Perelman's self-made fortune, a point of pride for this giddily competitive, 5-foot-7 corporate barbarian, declined frightfully. It peaked at $6.5 billion in 1997 and fell by two-thirds in four years to a low of $2.3 billion in 2001, FORBES estimates. Suddenly he's back. Perelman's fortune, largely amassed through the acquisitive MacAndrews & Forbes (no relation to this magazine), is $6 billion, ranking him number 34 on the list of richest Americans.

Focuses on hedge fund companies which are flush with cash and acting as corporate raiders. Example of Highfield Capital Management which was dismayed to see its investment in Circuit City Stores declining and decided to buy the whole company in a surprise bid; Hedge fund firms which are reinventing themselves as private investment companies; Hedge funds and their affiliates which have announced deals for 23 companies in the past year; Reaction of boards, CEOs and Corporate America; How the raiders of today differ from those in the 1980s; Several deals and how they transpired; Belief that the reinvention of the hedge fund marks a new era for the industry. INSETS: Tough Breed;Tough Breed.

In 1984, Oscar S. Wyatt Jr., the legendary oilman and corporate raider, made a $1.3 billion hostile bid for Houston Natural Gas Corp. Wyatt was building a network of natural-gas pipelines that would snake around the country. Houston Natural had other ideas. To rebuff the raider's play, it offered to buy all the stock in Wyatt's own company, Coastal Corp. Wyatt was furious. A legal battle ensued, and Wyatt eventually walked away--but only after he had forced Houston Natural to buy back his stake at a $14.6 million after-tax profit. Twenty years, several hundred million dollars, and a few brick walls later, Oscar Wyatt is back, and he wants something--this time, El Paso. In one of the biggest proxy battles in a decade, Wyatt, 78, has teamed up with another major El Paso shareholder, Selim Zilkha, 76, to try to wrest control of the nation's largest natural-gas pipeline company from its management and board of directors. The shootout will occur in mid-June 2003 at El Paso's annual meeting, where shareholders will vote to either keep El Paso's board or replace it with a new slate of directors and CEO, all handpicked by Wyatt and Zilkha. Why would Wyatt and Zilkha, at this point in their lives, mount an exhausting, expensive, and time-consuming proxy battle? Because they're really mad. Each had tied up a huge chunk of his personal wealth in El Paso stock, and together they have lost nearly $900 million on paper since early 2001. The battle may have started over money, but now it's about pride and, of course, Texas-sized egos. In their eyes El Paso's board had its chance and blew it. They want their team calling the shots.

The article focuses on several wealthy investors who appeared on the Forbes 400 list in 2002. Carl Icahn is a corporate raider in 1980s with big scores in Texaco, USX and TWA, now prefers the label shareholder activist. H. Ross Perot , two-time presidential candidate had to answer to California lawmakers on accusations that his Perot Systems helped energy sellers exploit the state trading system. Leveraged buyout lover Ronald O. Perelman finally ended long slump with sale of Golden State Bancorp to Citigroup.

Profiles former takeover artist T. Boone Pickens Jr. Struggles he has faced, including losing his company Mesa Petroleum and his divorce from his first wife; Businesses he is involved in, including ENRG, a natural gas company, and a commodities fund; Amount of money he has made; Thoughts on how Pickens has changed as he's gotten older; Details of his plans to drill water from an aquifer that lies under his land in Amarillo, Texas and sell it to other cities; His relationships with his family.

Jared Gordan, the president of the Industrial Products Division for Compunext is a first-rate manager. In just three years, he's turned around a flagging division and increased sales and profits by 50%--a dramatic shift from five years earlier, when analysts were suggesting that the company sell the division. But that's not all. In addition to being a turnaround expert, Jared has shown a special aptitude for recruiting and developing talent. Many executives have noticed this faculty, and--unfortunately for Jared--those running Compunext's biggest, most glamorous divisions are poaching his best managers. In fact, Industrial Products has just been raided for the tenth time in two years, and Jared is spitting mad. This Time, the Telecommunications Division has wooed--and won--Stan Simpson, Industrial Products's VP of sales. Jared, right or wrong, confronts Hank Dodge, president of Telecommunications, for not coming to him before offering Stan the job. Still furious, Jared then meets with Sue Patel, Compunext's VP of human resources, to discuss what can be done to avoid future raids. Does Jared have good reason to be angry? What lies at the root of the problem, and how can Jared solve it? Four commentators weigh in on this fictional case study. [ABSTRACT FROM PUBLISHER]

Opinion. Looks at corporate raider Carl Icahn's failed attempts to buy RJR Nabisco. The methods and strategies he and sometime partner Bennett LeBow have used; The assertion that the era of the corporate raider is over, because funds are much more difficult to raise in the 1990s than they were in the previous decade; How RJR Nabisco CEO handles Icahn's attempts; The effect of tobacco legislation on the company; Other details.

According to conventional wisdom, the corporate raiders and buyout specialists who flourished in the 1980s were the antithesis of good management. Their goals of realizing quick profits from the acquisition of major companies--frequently through rapid cost-cutting and the breakup of conglomerates--made them the bane of old-school corporate leaders. Long-term management, it seemed, was being sacrificed on the altar of short-term profits. With the abatement of takeovers in recent times, top corporate managers have hailed a return to business-as-usual. But the takeover artists have not, in fact, retreated. Instead, these corporate acquirers, many of whom own large stakes in major industrial companies, are assuming board seats and switching their emphasis to overseeing the companies they control--with an eye toward the long term. In this new role, the takeover experts are not plunderers, nor are they creating quick profit at the expense of companies' long-term health; rather, they are defying expectations and, in a number of important respects, successfully implementing the agenda of the gurus of good management. Setting the pace in this new arena is the most powerful takeover group of the 1980s, the leveraged buyout firm of Kohlberg Kravis Roberts & Company. KKR's partners hold board seats at nine different companies with $1 billion a year or more in sales. And while their metamorphosis from swashbuckling financiers to patient company overseers has not always been a smooth one, on balance, KKR is practicing a surprising amount of what might be regarded as a textbook version of sound management methods--including rigorously evaluating CEO performance, devising proper management incentives, and making budgets count. INSET: Dividing Up the Work.. [ABSTRACT FROM AUTHOR]

The article reports on the growing trend of consolidation and merger of business industries in the U.S. Corporate takeovers are considered an important way of driving energy among business sectors. At the same time, a new corporate mentality toward acquisitions is spurring divestitures of unwanted assets of the newly acquired companies and getting other deals. Yet, many businesses considered the trend an edge in competing globally.

The article focuses on corporate raiders. It states that with the rise in undervalued corporations coming up corporate raiders are stalking undervalued corporations and taking control of them. It reports that these raids have set fear and outrage among executives of companies. Information on raiders including T. Boone Pickens is presented.

The author reflects on corporate financial restructuring in the U.S. It is inferred that takeovers did more harm than good, because corporate raiders make a lot of money while leaving thousands of corporate employees out of work. However, he argues that though restructuring occurs periodically in a capitalist economy to adopt economic and technological change, corporate structures has remained unchanged. He believes that if economic efficiency and innovation are promoted, mergers will succeed.

Whether CEOs like it or not, capital markets now demand that they monitor the "value gap" between what their company's shareholders realize now and what they might be able to get. An unprecedented amount of money is searching for takeover targets. Between 1985 and 1987, the dollar value of mergers and acquisitions exceeded $520 billion--ten times the value of mergers between 1975 and 1977. In the first three months of 1988, mergers and takeovers valued at nearly $75 billion were announced. As the pool of available funds grows and the number of easy targets declines, acquirers will turn their attention to companies with smaller and smaller value gaps. No one is immune. The solution? CEOs must start thinking and acting like raiders themselves. First, they need to assess their companies' situation--measure the value gap and track it periodically. Managing the gap is the tough part, although it is much less complicated than many people think. CEOs can choose one or more of three basic options: improve operations, leverage the company's capital structure, or sell business units to the "best buyers." New owners at Beatrice Companies in 1986, for example, generated $9.3 billion from selling individual businesses--$3.2 billion more than the cost of acquiring the entire company. Beyond these value-enhancing actions, executives can also throw legal hurdles--like poison pills or dual class shares with different voting rights--in the path of potential acquirers. And since a large part of many companies' value gaps is tax related, lobbying in Washington can help. Managing the value gap may be a struggle for CEOs, and cost-cutting measures a tough pill to swallow for employees, but the costs of complacency are much higher. [ABSTRACT FROM AUTHOR]

A successful company suddenly realizes that several takeover raiders are hovering around it. What can it do? The company is strong, its management team has loyally nurtured it for years, and its directors want it to survive. One of them tells the story. While there's still time to negotiate a friendly takeover, the company decides to look for an investor it can live with. A multinational from abroad seems to care about keeping the business's team together, so the company accepts the takeover offer. For a while, all goes well, but then the multinational reorganizes. The company that's been taken over is dissolved, and its management team split up. What can other companies learn from this story? That premerger agreements do not always turn out as expected, says the author, and that a takeover can destroy much of a company's productive effectiveness. Once the management team disperses, he says, the heart of the company is gone. What did the company do right, and what should it have done differently? The opinions of three commentators follow this firsthand account. [ABSTRACT FROM PUBLISHER]

HBR published a sweeping defense of hostile takeovers ("Takeovers: Folklore and Science" by Michael C. Jensen) in the November-December 1984 issue. The one-sidedness of the argument and the nature of the underlying assumptions made the editors uneasy, but they decided that the reasoning deserved attention and would indeed invite rebuttal. In a discussion that HBR hopes will continue, a well-known corporate executive takes a different view of the most dramatic development of the long-standing merger and acquisition movement. The author identifies the reasons for the surge in takeovers, the rise of the belief that a takeover enhances shareholder wealth, and what he considers to be the fallacies of the argument. He finds that the activities of the major participants in the takeover market create a feverish atmosphere that makes careful board and shareholder deliberation impossible. To investment bankers and boards of would-be acquirers, he proposes restraint and recommends that the SEC become concerned about the speculative excesses of takeover entrepreneurs and arbitrageurs. [ABSTRACT FROM PUBLISHER]

Focuses on the activities of corporate raiders in the United States. Factors contributing to the widespread approval of speculative corporate buyouts in the country; Information about hostile takeovers in the country during 1981; Impact of corporate buyouts on finance and corporate culture; Details about an entire chapter on defending hostile takeovers in the book "Economic Report of the President."

Jack Finn, the central character in this case, is caught in a dilemma that has haunted many an entrepreneur. What are a small company president's responsibilities to minority owners when his organization comes under the control of a new and hostile owner? After reading the case and deciding how you would advise Finn, compare your opinions with those of the commentators. This case is based on an actual situation although all the names mentioned are fictitious. [ABSTRACT FROM AUTHOR]

Early diagnosis and review of the financial and nonfinancial indicators of change--liquidity, debt position, price/earnings ratio, and stability of earnings--are a must for every corporate management team that wishes to guard against the advances of an undesired, yet ardent, suitor. For the company on the verge of vulnerability, there may still be time to ward off a potential take-over by a vigorous program of change. And even the company that already is a target can avail itself of certain emergency actions to delay, if not discourage, the unwelcome raider. Above all, it is important to have realistic, dual purpose plans--one for offensive action when there is still time to implement such a program; the other for defensive purposes after the company is under attack. [ABSTRACT FROM AUTHOR]

Several letters to the editor are presented in response to articles in previous issues including Ronald Grover's "Just Don't Call Him a Raider," profiling investor Carl C. Icahn in the March 5, 2007 issue, Max B. Sawicky's "Minimum Wage, Maximum Pork," and "Hot News in Nowwheresville," both in the February 19, 2007 issue.

The article reports that corporate raider and shareholder Carl C. Icahn is trying to take control of Time Warner's board of directors in order to oust Chief Executive Richard D. Parsons. Icahn announced his hiring of Lazard Ltd. to help seize control of the board of Time Warner. Upset by Time Warner's stalled stock price, Icahn plans a proxy fight to field his own slate of candidates for the company's board seats. If Icahn--who so far has put together a coalition of dissident shareholders--gains a majority on the board, Parsons will be ousted. Shortly after becoming chief executive in May 2002, Parsons saw Time Warner shares plunge from $19 to $9.60 as major government investigations of America Online loomed, civil lawsuits mounted and the company's debt teetered toward junk status. Icahn estimates that Time Warner would trade about 50% higher if the company spun off its cable unit.

Focuses on the controversy surrounding famed corporate raider Carl Icahn and Time Warner Inc. History of Icahn's work on Wall Street; Review of how Ichan and his allies control about 120 million shares or 2.6 percent of Time Warner; View of how Ichan that Time Warner management has been too timid in restoring the company's tarnished glory; Comments from Ichan regarding his work.

Discusses the stock market, junk-bond mutual funds, and possible takeovers by corporate raiders like Carl Icahn, Irwin Jacobs, and Ted Forstmann. How leveraged buyouts are more complicated in 2001 than they were in the 1980s; Impediments to raider activity.

Discusses a resurgence of the corporate raider in the United States as of July 2000, after becoming nearly extinct in the 1990's. Examples of raiders who are making a comeback, including Carl Icahn who made a bid for Nabisco in the spring of 2000; Number of deals announced by leveraged-buyout firms in the first six months of this year; Challenges that corporate raiders face now that they did not face in the 1980's. INSET: Where Are They Now?.

Sir James Goldsmith, corporate raider, is profiled. His takeover strategies, his plan to build a media empire across Europe, the Goodyear takeover attempt, and his right-wing conservative stance on issues. INSET: Goldsmith's empire..

Profiles Carl Icahn, the corporate raider who announced on Nov. 11 his intentions to buy Pan Am Corp. for his 90 percent-owned Trans World Airlines Inc. How the purchase would create a more viable and salable TWA; Making bold moves with cash; Operating on a grander scale; Other bold moves; Credibility gap. INSET: HOW ICAHN'S MAJOR INVESTMENTS ARE FARING.

The article discusses the differing views of the Securities and Exchange Commission (SEC) and investors on tender offers. Ten years ago Congress passed the Williams Act, which was created to enable the SEC to impose controls on tender offers by companies seeking to acquire other companies. The law aims to require full and fair disclosure for the benefit of investors. Ironically, while the purpose of legislation was to benefit the individual investor in publicly owned companies, the SEC developed a rule that permitted an offering company to surprise its victim with a cash offer at some premium over the market price.