Victor Posner: Difference between revisions

==CareerEarly life==

Of [[History of the Jews in Russia|Russian-Jewish]] descent, hePosner was born in [[Baltimore, Maryland]], one of nine children of [[History of the Jews in Russia|Russian-Jewish]] grocers Morris and Mary Posner. Though he left school at age 13, he claimed to have earned his first million dollars by the age of 21 by investing in real estate, although financial records do not confirm this.{{citation needed|date=May 2022}}

Posner's primary vehicle was the Deisel-Wemmer Co., a cigar manufacturer and importer based in Ohio, which was founded in 1884. By January 23, 1929, Deisel-Wemmer incorporated as Deisel-Wemmer-Gilbert Corporation (DWG) when acquired by an investment group. DWG was a small outfit and just to keep up market share purchased other small cigar companies like Odin cigars in 1930 and the Bernard Schwartz Cigar Corporation in 1939. The Company on May 15, 1946, changed its name to a simple name, DWG Cigar Corporation. Another series of acquisitions started in 1948 with the Nathan Elson Company following with A. Sensenbrenner & Sons in 1955 and in 1956 Chicago Motor Club Cigar and Reading, Pennsylvania-based Yocum Brothers. With the weakening of the cigar market due to medical advisories, many smokers switchswitched to cigarettes, which were then believed to be safer. DWG then streamlined cigar operations and began looking for other businesses that might suit DWG's wholesale and distribution strength. The [[New York Stock Exchange]] delisted DWG in 1965, the company then sold their remaining cigar operations or closed them in 1966. Renamed as DWG Corporation, DWG used its cash from the cigar operation sale to purchase a 12% share of the National Propane Corporation. Security Management Company, headed by Victor Posner, a major investor in DWG saw potential with the company as it was bold to sell its main operation. Posner saw it as a good takeover vehicle and became the controlling interest of DWG.<ref name="FU">{{cite web |url=http://www.fundinguniverse.com/company-histories/Triarc-Companies-Inc-Company-History.html|title=Triarc Companies, Inc. Company History |access-date=2008-06-17 |work=Funding Universe }}</ref>

An investor that Posner contacted to help get Sharon Steel out of bankruptcy, indicated that his lawyer, Andrew Heine, might want to buy [[Fischbach Corp.]] Just short of Fischbach being sold, Heine's Granada Investments Company made a bid for all of DWG at $22 per share. Posner converted all DWG options into voting shares but was unable to vote them due to an Ohio judge's order. Granada sued Posner for not taking the bid seriousseriously and Posner sued back stating the bid had no merit. Posner lost the case in 1991 and was forced to pay $5.5 million to Granada. Furthermore, the judge noting other investigations in illegal stock trading in the Fischbach acquisition and of Posner's compensation added three court-appointed directors to DWG's board as audit, compensation, and intercorporate transactions committees.<ref name="FU"/>

Snapple, Mistic, and Stewart's (formerly Cable Car Beverage) was sold by the company to [[Cadbury plc|Cadbury Schweppes]] in 2000 for $1.45 billion<ref name="nyt"/> In October of that same year, Cadbury Schweppes purchased Royal Crown from Triarc.<ref>{{cite encyclopedia |url=http://www.georgiaencyclopedia.org/nge/Article.jsp?id=h-3535 |title=Royal Crown Cola Company |access-date=2008-06-18 |encyclopedia=New Georgia Encyclopedia |date=September 15, 2006 |archive-date=2012-10-12 |archive-url=https://web.archive.org/web/20121012073022/http://www.georgiaencyclopedia.org/nge/Article.jsp?id=h-3535 |url-status=dead }}</ref>

He was said by ''Forbes'' magazine to "have the arrogance of a banana republic dictator" and by the ''[[The New York Times]]'' to be the "dean of the corporate takeover".<ref>http://www.findarticles.com/p/articles/mi_m3190/is_n38_v23/ai_7964205 {{Bare URL inline|date=September 2022}}</ref> T''he[[The Economist]]'' said, after he died, "he was a pioneer of the hostile takeover of a public company. He was dismissive of the convention previously observed that a takeover should have the agreement of the existing board. He would spot a company whose assets he judged were undervalued, gain control and milk it. Some bits would be sold off, others would be closed. Previously unconsidered treasures, such as the employees' pension fund, would be raided and reinvested in Mr Posner's other companies."<ref>[https://web.archive.org/web/20121104084404/http://www.highbeam.com/doc/1G1-87459971.html "Victor Posner, master of the hostile takeover"], ''The Economist March'' 7, 2002</ref> Posner was a maverick player in the world of corporate finance. Many of his dealings were alleged to be illegal and he was closely watched by the [[United States Securities and Exchange Commission|Securities and Exchange Commission]] from the mid-1980s on.

The late 1980s were the start of his downfall.<ref>{{Cite book|url=https://books.google.com/books?id=cW2jAQAAQBAJ&q=Victor+Posner+downfall&pg=PA379|title=Business Scandals, Corruption, and Reform: An Encyclopedia &#91;2 volumes&#93;: An Encyclopedia|isbn=9781440800689|last1=Giroux|first1=Gary|date=12 July 2013|publisher=Abc-Clio }}</ref> In 1987, Sharon Steel operated in [[Chapter 11, Title 11, United States Code|Chapter 11]] bankruptcy protection. At first, Posner stayed on as CEO and chairman as is customary in Chapter 11 business reorganizations. Against Posner's objection, the bankruptcy court appointed a trustee to take over shortly thereafter, since Posner refused to undo some $10 million in payouts to himself and his son Steven (among other questionable transfers of corporate assets to other businesses controlled by Posner), at a time when Sharon Steel was hemorrhaging $2 million per month. On appeal, the Third Circuit affirmed.<ref>{{Cite web|url=http://cases.justia.com/us-court-of-appeals/F2/871/1217/44511/|title = In Re Sharon Steel Corporation, Debtor.appeal of DWG Corporation and Victor Posner, 871 F.2d 1217 (3d Cir. 1989)}}</ref>

Posner died of pneumonia on February 11, 2002, after suffering declining health for several years.

In 1995, Steven sued his father over alleged mismanagement of his company, Security Management Corporation, claiming that the elder Posner was paying himself too much money and had wrongly removed Steven as a company director.<ref>[https://query.nytimes.com/gst/fullpage.html?res=990CE2DB1F3EF93BA3575AC0A963958260 "Victor Posner Sued by His Son"]''New York Times'', September 8, 1995</ref> They settled the suit by flipping a coin over the share of more than $200 million worth of property.<ref name="Forbes">''Forbes'':[https://www.forbes.com/forbes/2003/0811/046b.html All in the Family.] May 8, 2003.</ref> Steven was killed in a high-speed boat crash near [[Miami, Florida|Miami]], [[Florida]], on 29 November 2010.<ref>[http://latimesblogs.latimes.com/afterword/2010/11/steven-posner-real-estate-tycoon-dies-at-67.html "Steven Posner, real estate tycoon, dies at 67" ''Los Angeles Times''] 30 November 2010</ref> Gail died on 19 March 2010 in [[Miami Beach, Florida|Miami Beach]], [[Florida]].<ref>[https://www.imdb.com/name/nm1636921/ "Gail Posner" ''imdb.com''] 30 November 2010</ref>

Shortly before he died, Posner prepared a new will that removed his children and grandchildren as heirs to his estate, which was valued between $200 million and $1 billion. Instead, Brenda Nestor was named as the main beneficiary. Posner's children and his adult grandchildren sued on grounds that he was not competent when he made the changes.<ref name="Forbes" /> The legal entanglements continued until the last lawsuit was settled on April 8, 2015, over the $195 million estate Posner bequeathed to Nestor. The [[Florida Third District Court of Appeal]] ruled Tracy Posner Ward could not sue Nestor for $5.8 million in a trust Victor Posner had set aside for Ward's daughter Melody. In addition, the Victor Posner estate got tied up in liens from the Pension Benefit Guarantee Corp., the Federal agency noting that the pension plan sponsored by Posner's estate had a shortfall of $38.8 million, and the plan was terminated by the agency.<ref>{{cite web|last=Marcus|first=Noreen|date=April 13, 2015|url=http://www.dailybusinessreview.com/id=1202723356696/Posner-Estate-Winding-Down-After-13Year-Battle?slreturn=20150621031239|title=Posner Estate Winding Down After 13-Year Battle|website=law.com|access-date=July 21, 2015}}</ref>