Ronald Perelman: the billionaire who is downsizing

Ronald Perelman acquired a fortune as a dealmaker during the 1980s takeover boom. Now he seems to be quietly selling up.

After coming to prominence as one of the original “barbarians” of the 1980s junk-bond-fuelled takeover boom, Ronald Perelman settled into life as a collector. As well as a profusion of companies, a vast art collection and the usual stack of properties and yachts, “the pugnacious dealmaker” accumulated five marriages, eight children, a $12bn-$14bn fortune and “countless legal bills from run-ins with family members, business associates and regulators”, says the Financial Times. His biggest bauble is a controlling stake in cosmetics giant Revlon. 

A complicated man

But something seems to be up, says Town & Country. Perelman has been unloading assets. “A lot of them. Rapidly.” In July he sold a Matisse and a Miro at Sotheby’s for a combined $37.2m (a disappointing price: the estimate had been $53m) and there are reports of more treasures in the pipeline. Perelman’s investment company, MacAndrews & Forbes, has also been making disposals, recently selling a $1bn tranche of shares in Scientific Games, a maker of casino, interactive and instant lottery games, as well as its majority stake in the maker of Humvee military Jeeps. 

We should beware jumping to conclusions: “billionaires – especially those who leverage and buy out – unload pricey assets all the time”. But Perelman’s net worth has plummeted from $19bn in 2018 to $4.2bn, according to the Bloomberg Billionaires index, prompting speculation that he’s running out of money. Denials that he is selling his 57-acre East Hampton estate for $180m in a so-called “whisper sale” haven’t dissuaded the sceptics. 

Perelman is a “complicated guy”, still best known on Wall Street “for his highly improbable, but ultimately successful” $2.7bn hostile takeover of Revlon in 1985 when he was 42. A deeply religious Orthodox Jew of Lithuanian descent, he had moved to New York from Philadelphia in the late 1970s “to get out from under the yoke of his father, Raymond”. Young Ron was sweeping floors in his father’s factories aged 12 and, after university, became his father’s foundry manager. His escape ticket was marriage (his first) to a real-estate heiress who helped finance his first independent venture: a chain of jewellery stores, says Fortune. Shortly after, Perelman acquired a stake in MacAndrews & Forbes, a licorice-extract specialist that he built into his main holding company. In the high-octane environment of Wall Street in the 1980s, his dealmaking career was soon on “the takeoff runway”. 

Perelman ended up nurturing Revlon for 35 years, says Vanity Fair: his daughter Debra is currently CEO. But, lately, things haven’t been going well. Last year, Perelman hired Goldman Sachs to explore a possible sale. But there have been problems restructuring Revlon’s $3bn debt. Following a refinancing in May, Moody’s downgraded it further into “junk” territory. The stock is down roughly 68% in 2020. 

If Perelman is downsizing, friends insist it’s because he has “learned to love and appreciate the bourgeois comforts of family and home”, says Town & Country. Nonetheless, it feels as if roles have been reversed. The barbarians are knocking at the gate again – and this time it’s Perelman’s.

Recommended

Made money in cryptocurrencies? Don’t forget to pay your taxes – in sterling
Bitcoin & crypto

Made money in cryptocurrencies? Don’t forget to pay your taxes – in sterling

Speculating on cryptocurrencies is akin to gambling in all but one respect, says Merryn Somerset Webb: you must pay tax on any gains, and you must pay…
18 Jan 2022
HubSpot: a tech stock set to tumble
Trading

HubSpot: a tech stock set to tumble

US tech stocks have had a fantastic couple of years. But this year is unlikely to be so bullish for high-fliers that can’t turn big profits.
18 Jan 2022
How to help your business cope with rising energy costs
Small business

How to help your business cope with rising energy costs

With rising energy costs putting cost pressures on the country's businesses, the best way to keep the lights on is to make sure you’re turning them of…
18 Jan 2022
How to save money when getting a divorce
Personal finance

How to save money when getting a divorce

If you're thinking of getting a divorce, waiting for the new laws in the next tax year could ensure a difficult process becomes a lot cheaper.
18 Jan 2022

Most Popular

US inflation is at its highest since 1982. Why aren’t markets panicking?
Inflation

US inflation is at its highest since 1982. Why aren’t markets panicking?

US inflation is at 7% – the last time it was this high interest rates were at 14%. But instead of panicking, markets just shrugged. John Stepek explai…
13 Jan 2022
Five unexpected events that could shock the markets in 2022
Stockmarkets

Five unexpected events that could shock the markets in 2022

Forget Covid-19 – it’s the unexpected twists that will rattle markets in 2022, says Matthew Lynn. Here are five possibilities
31 Dec 2021
Tech stocks teeter as US Treasury bond yields rise
Tech stocks

Tech stocks teeter as US Treasury bond yields rise

The realisation that central banks are about to tighten their monetary policies caused a sell-off in the tech-heavy Nasdaq stock index and the biggest…
14 Jan 2022