Friday, 26 June 2009

Michael Jackson and his (former) manager Frank DiLeo

In the wake of the death of Michael Jackson there is bound to be a lot of financial unraveling to be done as the superstar's estate would seem to be complex and troubled.

There is a fascinating insight into Michael Jackson's financial woes in this article from the WSJ, which appeared just two weeks ago.
The 50-year-old singer's debts now stand at around $500 million, according to three people familiar with his finances. The value of Mr. Jackson's biggest assets -- music copyrights that include 251 Beatles songs as well as his own compositions -- probably still exceed his growing debt, according to these people. Mr. Jackson's manager said the singer wasn't available for comment.

Last spring, Mr. Jackson defaulted on a $24.5 million loan backed by the ranch. Los Angeles-based Colony bought the note for $23 million and put the title into a joint venture it formed with the singer.

As Neverland is brought back to life, concert promoter AEG Live is trying to resurrect Mr. Jackson's music career. He is booked to play 50 shows at London's O2 arena over several months starting in July. If all goes according to plan, Mr. Jackson could make as much as $50 million, according to people familiar with financial details of the shows. Adding dates in Europe, Asia and North America could net him $400 million, these people say.

But Mr. Jackson has already delayed the first four shows in London, citing a need for additional dress rehearsals. In April, he pulled out of a plan to auction most of the personal effects and furnishings from Neverland. And he recently parted ways with Tohme Tohme, a Colony Capital business associate who for several months acted as his manager, striking the deals for the Neverland joint venture, the auction and the London concerts. Taking Dr. Tohme's place is Frank DiLeo, Mr. Jackson's manager from 1984 to 1989. Mr. Jackson didn't offer an explanation for the change, according to associates notified about it.
One of the revealing details from the WSJ story from just two weeks ago is the apparent decision by Jackson to re-engage his former manager Frank DiLeo, who was in charge of the singer's career during the boom years in the 1980's. Indeed Mr. DiLeo was the top promotion executive at Epic Records in the early 1980's, and who was largely responsible for making the Thriller album the most successful record of all time.

DiLeo has also been featured in several movies including featured parts as a music mogul in Wayne's World and his portrayal of gangster Tuddy Cicero in the excellent film Goodfellas directed by Martin Scorcese.

It remains to be seen whether the singer and manager were contractually re-united in any fashion, and whether, in fact, Mr DiLeo will have any role to play in sorting out the many business interests of the singer including his stake, along side SONY/ATV Music publishing, in Northern Songs - which owns the music publishing catalog of John Lennon & Paul McCartney.

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