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November 07, 2007

Michael Jackson Bankruptcy

Michael Jackson might be entering bankruptcy. Which is really very odd indeed as he has huge assets. Perhaps it's that he's not getting good advice?

Some kind souls alerted us to the fact that Michael Jackson's Neverland Ranch has appeared in the November 5th, 2007 Foreclosure Detail Report for Santa Barbara county (full report here).

While the looming foreclosure of Neverland Ranch has received some coverage, this would appear to be hard confirmation of the event... and indication that it is still underway.

The thing is, while he has a loan out against that house, one which he's obviously not repaying, he does have assets that could be used to remedy the situation.

Now, the final vestige of Michael Jackson’s unironic reign is reportedly on the verge of being taken away, after MJ defaulted on a $23 million loan. Jackson was given ninety days starting October 22nd to repay his debt or risk losing the ranch, which had been shuttered and its employees dismissed since he was accused of using the park as a lure for young children (or since he failed to pay the employees’ salaries and insurance). The ranch was used as collateral for Fortress Music Trust when they loaned the beleaguered pop star $20 million, and after failing to sell another company Jackson’s debt, Fortress is eager to recoup their losses.

...

With all this talk of debt, it’s easy to forget that Jackson is still rich. He owns a 50 percent stake in Sony/ATV Music Publishing, including the Beatles catalog, which has an estimated value of $600 million. If Jackson were to declare bankruptcy, however, that stake would be liquidated and auctioned to the highest bidder.

So the oddity is why doesn't he borrow against that stake to save the ranch?

November 7, 2007 in Music | Permalink

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