McCaw

"But no one ever minimized Lumry's importance to the company or doubted his genius at raising money. For the increasingly high-flying McCaw company, Lumry was the airborne tanker supplied with finan- cial fuel. He took the company's meager financial results and blended them with talk of McCaw's vision and the future of cable into a tale that won the support of bankers and other investors. He knew what to tell the bankers and what not to tell them, and how to give them bad news that sounded good. If losses ran bigger than the company projected, Lumry gave them a happy spin. That red ink, he would say with feigned pride, was a "tax shelter ahead of schedule." Lumry led the bankers to the only logical conclusion: that McCaw could walk on water. In the end, they would be eager to lend $85 million on $4 million a year of cash flow."

"Stanton had a brilliant idea, suggested by a case he had studied at the Harvard Business School, in which British Petroleum had merged with Sohio, an American oil company. The deal required that a value be set on the oil rights BP owned in Alaska's North Slope, yet neither party knew how much the oil there was worth. So the two companies agreed to a minimum and a maximum value. Stanton proposed a similar strat- egy. He suggested offering Scripps 40 percent ownership of the cellular division, a generous offer based on McCaw's current value. But if McCaw's company grew, Scripps's ownership would shrink in stages to 15 percent. In either scenario, Scripps would be guaranteed a handsome return on its investment."

"This kind of fancy financial footwork typically happened only near the end of a quarter, when Hooper and Lumry were struggling to ensure that cash flow would meet the targets set in loan agreements. (Hooper says the practice only lasted a year.) The company took great pride in never violating a loan covenant. McCaw aimed to set the highest ethi- cal standards, but there were times when it was necessary to push the envelope—so to speak."

"Marion always believed in the paperwork. That attitude of having good paper, strong paper, documenting things, making sure you're very careful. . . . Marion instilled in us one of the McCaw attrib- utes, which was to outdocument people. Be smarter in documenta- tion of everything, things like programming agreements and acquisitions agreements A lot of people think that a highly leveraged company is an out-of-control company. What they don't understand oftentimes is that the companies that are highly lever- aged have the most control. People assume that a company that is wild and woolly in its acquisition strategy and moving along at a breakneck pace, that the rest of the company is like that . . . [that]"

"nobody is keeping track of the operation, nobody has good accounting, nobody has good management information systems. [But at McCaw] it's just the opposite. McCaw had a very aggres- sive growth strategy. But we had a very sound system of managing the business, keeping track of the organization and certainly paying attention to our contractual sides. That was a big part of [the growth strategy]. It wasn't just me as general counsel. McCaw was a stickler for making sure we had things protected, had thought things through."

"In a straight-up fight, it would be no contest. "If it was good-old- boy, Corporate America, tee 'ime at Augusta, we weren't going to win," says Perry. "We knew that. We knew we had to change the game. We had to be in a game where vision, strategy, other things were impor- tant." Like the Vietcong guerrilla forces, the McCaw team would try to force a more powerful adversary to play by unfamiliar rules, to make the game messy and embarrassing until it was forced to withdraw."

"Working from a Los Angeles office, Milken had created a $125 billion pool of capital that had helped tiny companies swallow giants and permitted obscure executives to gain control of world-famous busi- nesses. So effective was his operation that a mere statement that Milken believed he could raise a financial war chest in pursuit of a particular corporate quarry—a so-called "highly confident" letter—could cause panic at the company targeted for takeover. Secretive, feared by competitors, and closely monitored by securities regulators, Milken already played an enormous role in the communications industry. During his time at Drexel, he channeled some $26 billion into MCI, McCaw, Metromedia, Viacom, TCI, Time Warner, Turner, Cablevision Systems, News Corporation, and other cable, telecom, wireless, publish- ing, and entertainment companies."