The next day, Eisner agreed to pay $5.3 billion (including more than two billion dollars of debt) for the company—about a billion dollars more than News Corp. executives had believed it would bring. “Haim was in command—it was Haim’s price,” Stan Shuman said.
The financial press concluded that Eisner had overpaid. (Eisner felt that he had, too, by eight or nine hundred million dollars.) And the transaction proceeded under strain; after September 11, 2001, Disney threatened to back out of the deal, and at one point News Corp.’s general counsel, Arthur Siskind, tried to remove Saban from the negotiations, believing that he was too unpredictable. Saban later told Andy Heyward that he said to Siskind’s message-bearer, “You tell that fucking guy to stay out of my face! I was driving a fucking tank in the Israeli Army on the Golan Heights when he was watching ‘Scooby-Doo’!”
Saban continued to lead the negotiations, and his high-level relationships proved invaluable. Because Disney and Fox Family operated internationally, the deal required regulatory approvals from many countries. “Brazil could have been a deal-breaker,” Chernin recalled. In a confidential memorandum written on October 1st, Fox Family’s attorneys in Brazil explained that the deal would have to be reviewed successively by three government bodies; from past experience, the attorneys estimated that the process would take between six and eight months, which would push the deal past the deadline, at the end of October. Disney refused to close without Brazilian approval. Both sides retained counsel for the anticipated litigation.
“Haim said, ‘Let me make a phone call—maybe I can get something done here,’ ” Chernin told me. “He was extremely helpful in getting Clinton to help. Clinton called the President of Brazil.” Matt Krane recalled how Saban described to him what had happened: “Saban had called the Fox Family attorney in Brazil and asked, ‘How long will it take?’ It was months. He said he asked the lawyer, ‘Who is your finance minister?’ The attorney understood, and he said, ‘There is no political pull available in this process.’ Saban called Bill Clinton and asked, ‘Can you help me?’ ” Soon afterward, the approval came through.
On October 24, 2001, the Disney-Fox Family deal closed. About a month later, Krane says, Saban gave him the task of devising a tax strategy for a donation of ten million dollars to the D.N.C., toward the construction of its new headquarters. “Of course, you can’t get a deduction for a political contribution,” Krane said. “Our mission was to structure it so he could get a tax benefit. So I got heavily involved, and worked a lot with D.N.C. lawyers to do it.” Via e-mail, Krane and the lawyers discussed possible real-estate strategies. “It started to become clear that any plan was too difficult to implement,” Krane told me. In January, 2002, the resolution was that Saban reduced his donation from ten million to seven million.
Terry McAuliffe, who was then the chairman of the D.N.C., says that Saban had first voiced his commitment at a party held at the Clintons’ Washington home in June of 2001, after McAuliffe made a presentation about the deplorable financial state of the Democratic Party. “Haim said, ‘I’ll commit up to ten million.’ ” It was not until January, 2002, that they met in a hotel room and negotiated the final amount. “He said four, I said I want the whole ten, then he got to six, then I said, ‘O.K., cut me a check for seven million in five days, and we got a deal.’ ” McAuliffe says that D.N.C. lawyers were not involved in any tax-benefit planning. “All I can tell you is there is no lawyer at the D.N.C. who would have that conversation,” he said. “That would be a felony.”
In March, 2002, Democratic Party officials disclosed that Saban, who had been named chairman of the Party’s capital-expenditure campaign, had written a check for seven million dollars to the “DNC Building Fund.” He had become the Party’s largest single donor. In an interview in the New York Times on March 21st, Saban explained how he had arrived at the figure: “We have two numbers in the Jewish belief that are lucky numbers—one is 18, and the other is 7. I thought 18 was kind of too high, so I went with 7.” He added, “I just felt compelled to do what I can.”
When the Fox Family deal closed, Saban instantly became one and a half billion dollars richer. His life had changed radically, but some things remained the same. When he became a partner in Fox Kids, a deal in which the Allen & Co. banker Stan Shuman had represented him, Saban insisted that Murdoch should pay part of Shuman’s fee, much to Murdoch’s displeasure. Allen & Co. eventually accepted one per cent of the merged entity’s stock, in lieu of a cash fee. (Saban denies that there was any disagreement with Fox.) Now, with the Disney deal, he didn’t want to pay twelve million dollars in fees and other costs that his investment bankers at Morgan Stanley said he owed. They sued; Saban settled on the eve of trial, and says he paid them eleven million dollars.
Even a closer associate was left feeling shortchanged. Shuki Levy, Saban’s decades-long partner, had received a payout on the Fox Family deal, as had other insiders who owned shares in Saban’s privately held company. But Levy, who had never had a written contract, felt that he was owed more, and demanded what he thought was his rightful share. Saban paid Levy an additional eleven million dollars. “I owed him, contractually and morally, nothing,” Saban said, adding that he paid him “out of compassion.” The two no longer speak.
