Raviv points out that "for Ronald Perelman, Marvel became a platform for selling junk bonds. Apparently he did not appreciate that he was the custodian of a distinctive piece of American culture." A junk bond is a high-risk investment. This was what all Marvel's business decisions in the late 1980s to mid-1990s were based on. Perelman's inclination was to pay whatever price was asked for something he wanted, especially if he thought he could convert it to junk bond money. This was an important part of the deal he made to buy a large non-majority share of Perlmutter and Arad's Toy Biz toy company, the major licensee of Marvel action figures. Perelman needed the toy company in order to shore up lagging profits at his over-leveraged Marvel, and Toy Biz got a "perpetual no-fee license to design, market and distribute action figures, other toys and games based on all the Marvel characters." (And if you found the preceding a tad confusing -- don't worry about it. Oh, unless you owned Marvel stock.)

In any event, the Perelman organization's machinations left the company vulnerable to corporate raider Icahn to try to come in and take over. Perelman wouldn't let go without a fight. Both billionaires got their egos caught up in what was actually a pretty small change company for them, and Toy Biz was in danger of becoming a casualty of this battle of the titans. As one frustrated major investor in the companies wrote: "Egos have destroyed the market price of all the securities in this case. First it was Ronnie Perelman, then the Icahn-Fortgang-Perlmutter Mid-East peace talks with a new deal every other month, I have been in too many bankruptcy cases where professional pride got in the way of making a deal fair to all. The professionals still get their fees and go on to the next case."

Indeed, in Comic Wars, Perelman and Icahn act like comics speculators, each wanting to hold onto this mint condition collectible -- Marvel Comics itself --and determined that, if he can't have it, the other guy sure won't get it, either.

Real World Repercussions
As someone who was working at Marvel (I was running the Spider-Man editorial line) while all this was going on, and who resigned partly in response to many of the strange decisions that were handed down from higher, non-editorial corporate levels, I found it fascinating to read about what was causing many of the strange dicta that were handed down to us. While many of the Perelman organization's moves did indeed bring profit to the company and its employees, they were, even more than we then realized, short-term strategies designed to increase junk bond profits. When these deals and moves went sour, it gave Icahn, who had bought many of those junk bonds, a chance to move in. Part of his moving in was to squeeze Toy Biz out. The banks that were owed the debt Perelman had run up became the pivotal players. By convincing them to align with Toy Biz, Perlmutter and Arad became the owners of Marvel, which they remain to this day. Perelman didn't do too badly, either. Depending on how you calculate it, he made somewhere between $50 and $500 million dollars from his ownership of Marvel. The lawyers for the various parties made $30 million. Icahn? He came away with some stock in the newly merged Marvel/Toy Biz (now called Marvel Enterprises), but probably actually lost money in the deal. There's one scary footnote, though. According to Raviv, in July, 1998, "Icahn signed a 'standstill agreement,' promising for five years not to try to take over -- or take any action against -- Toy Biz or the new Marvel." That was over four years ago. One has to wonder if Carl has the date circled on his 2003 calendar.

Raviv makes an exciting, sometimes funny, sometimes tragic, story of all these shenanigans. At a certain point, unless you're really well versed in finance, you're going to lose track of a lot of the details. I'd recommend just reading these passages for as much meaning as you can and moving on. Raviv recaps often enough what's going on and its ultimate meaning so that you can follow the story.

Comic Wars: How Two Tycoons Battled Over the Marvel Comics Empire -- And Both Lost by Dan Raviv. New York, New York: Broadway Books, 2002. 306 pages. ISBN: 0-7697-0830-9 (US$24.95)

Danny Fingeroth was a writer and editor at Marvel Comics for 18 years. He ran the Spider-Man line during its highest sales years of all time. He went on to be editor-in-chief of Virtual Comics and head of development for Visionary Media. Currently, he's writing graphic novels for Platinum Studios, packaging Danny Fingeroth's Write Now Magazine for TwoMorrows Publishing and is writing Superman on the Couch: What Super Heroes Really Tell Us About Ourselves and Our Society for Continuum Publishing. Danny and his wife Varda just had twin boys, Ethan and Jacob. The twins are fine. The parents are proud. And sleep-deprived.