Rupert at Rest
Ethan Caldwell was in New York on business on this particularly warm June day in 1990, representing American South Bank as legal counsel. The occasion for the trip was a meeting of a syndicate of 15 banks from around the world to negotiate the final terms of a $750 million credit facility for News Corp, the international media giant, headed by Rupert Murdoch. American South’s participation in the facility was to be $25 million, making it a very small player in the syndicate headed by two large New York banks serving as co-agents for all the lenders. The New York banks were supplying the major portion of the loan proceeds and basically calling all the shots related to the terms of the loan agreement. American South was participating at the invitation of and, in effect, at the sufferance of the two big banks. Under these circumstances, Caldwell’s job in New York would be quite simple. Since he would have absolutely no bargaining power with respect to the terms of the loan agreement, his only duty was to advise his client, represented at these meetings by Lindsay White, a senior vice president of the bank in the International Department, whether the bank should sign the final agreement as negotiated by the two agent banks or simply pull out of the transaction and go home. There would be no middle ground and no room for discussion.
The first meeting yesterday had been little more than a promotional presentation by News Corp and its various subsidiaries, including 20th Century Fox which, among other things, showed the bank group trailers from two of its latest movies, “Sleeping With the Enemy,” starring Julia Roberts, and “Edward Scissorhands,” starring Johnny Depp. Today’s meetings were expected to be more business-like, presumably concluding with a final executed agreement.
Ethan and Lindsay had agreed to meet for breakfast somewhere away from the hotel where all the activities were being conducted. They settled on a small restaurant on 6th Avenue. While searching for a place to sit, Lindsay noticed a man sitting alone toward the back of the restaurant whom she believed to be Rupert Murdoch. Disbelieving all the way, Ethan followed her to the table where the man was seated, standing back a ways while Lindsay confronted the man who was, in fact, Murdoch. After introducing herself and identifying her bank affiliation, Murdoch asked her to join him at the table. Only then did Lindsay acknowledge Ethan’s presence to the man and secure his permission for him to join. Lindsay was a reasonably attractive woman and, in Ethan’s estimation, that factor was the principal reason for the invitation to sit with Murdoch.
After some fairly stiff introductory pleasantries, Lindsay finally put the question to him that was at the forefront of Ethan’s curiosity: why was he here?
“Well,” he began, “all of these New York bankers have been very interested in showing me the many wonderful sights of the city, forgetting, or not caring to find out, that I have been living here in Manhattan for almost 2 years now and probably know my way around about as well as any of the high level bankers who mostly reside in Connecticut. I’ve eaten here a few times and it provides me with a sort of sanctuary away from all the activities that go with my position at News Corp. Don’t get me wrong, I’m pleased to have your company this morning, provided we don’t talk all that much about the credit facility.”
After talking a bit about the economy in Australia, Lindsay had to make a semi-emergency trip to the restroom, leaving Ethan alone in the booth with one of the richest men in the world. What to say, he wondered as he looked at Murdoch fumbling with his fork, obviously lost in thought, most likely about some unique financial structure of monumental proportions. Ethan interrupted, nonetheless.
“I noticed a poll in one of those London rags that the reason Sky Television wasn’t doing that well in London was because the Brits there just couldn’t buy into the idea that satellite TV would actually work reliably in the persistent fog and rain in London. Forget the scientific proof and frequent demonstrations; they just don’t think it makes sense. Plus, they think it’s some kind of Scottish deal because the name is the same as that big island off the northern coast of Scotland – not really the same name since the island has a silent “e” added, something Londoners obviously ignore in making their judgments. Typically, the English figure anything from Scotland is going to be of inferior quality except, perhaps, cellophane tape.
“I heard something about that poll”, Murdoch replied. “The Brits are so smug, thinking they are so much smarter than us Aussies and you Americans and then they come up with reasoning like that. Frankly, I’ve had it with that situation and, if my calculation of the time difference is correct, we should be signing a letter of intent to merge away that loser right about now.”
It took Murdoch a moment to realize he had spoken way out of turn to a stranger. He dealt with the situation by shoveling all remaining food items on his plate into his mouth while mumbling something inarticulate about disclosure. Eventually, he leaned over and asked, “Do you plan to share the information, uh, from the, uh, poll, with the other bankers? With Mrs. White?”
Ethan thought about that for a moment before replying. “I wasn’t planning on it. I’m just here for legal advice; and Mrs. White has already focused on the poor numbers for your TV company over there apart from any silly poll. She figures you are going to sell off that company pretty soon, so she isn’t overly concerned with it becoming a cash flow drag. Anyway, for my silence, could you maybe get me an introduction with Julia Roberts?”
Murdoch laughed and said, “I can only wish. Julia is a lovely person and destined for stardom, but she won’t have anything to do with me – which maybe suggests she has good sense as well. However, if you can keep quiet about the poll and any merger plans for Sky for a while – which I’m not officially confirming, mind you — I could possibly get you a meeting with Johnny Depp, if he hasn’t left town already.”
“Johnny who?” Dip?” That’s all Ethan could come up with.
“No, it’s Depp – D-E-P-P. He is the young star of one of our latest movies, ‘Edward Scissorhands.’ We showed a clip from the movie yesterday at the bankers’ meeting.”
“Oh, yea, I remember now. Looked like kind of a silly movie to me. Is it doing OK at the box office?”
“Actually, it’s doing quite well and I think a big reason is the star power of Depp.”
“Well,” Ethan concluded just as Lindsay returned to the table, “I’ll try to remember to follow his career, but I doubt it will measure up to the one Julia Roberts is going to have.”
Ethan never met Johnny Depp, but he also never said anything about the poll or the probable merger of Sky to any other bankers; and he never discussed his Murdoch conversation with Lindsay White, saying only that the two of them had laughed about the smugness of the Brits. Why should he? He was just an employee. A highly paid one and a professional, but still an employee.
* Later that year, on November 2, 1990, Sky Television merged with its rival, British Satellite Broadcasting, forming British Sky Broadcasting.