Citigroup May Save Jackson From Debt Woes

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Published February 17, 2006

| FoxNews.com

Michael Jackson | Jesse Hilsen | Liv Taylor | Sammy Davis Jr. | 'Crash'

Jacko Bank Deal: Will Citigroup Save Him?

As Michael Jackson considers a new deal that could save him, Neverland may no longer be insured, the zoo animals are looking for a new home and staff remains unpaid after eight weeks.

Michael Jackson’s perilous financial problems, documented here ad nauseum as they say, could be improving soon. I say ‘could be’ because with Jackson, you never know whether he will accept the deals worked out by bankers and lawyers or turn up his battered nose at them.

Remember, last year he snubbed a deal that could have bailed him out and he chose insolvency.

My sources now say that Sony Music has worked out a deal with Fortress Investments in which Fortress would sell the $270 million worth of Jackson’s loans they bought last year from Bank of America to Citigroup, the investment arm of Citibank.

Sony has played a significant role in brokering this deal because a deadline of Feb. 20 is looming. Fortress could foreclose on Jackson starting on that date if they so choose.

Sony has done everything, I am told, to keep Fortress from shutting Jackson down. The reasoning is that Jackson’s half of Sony ATV Music Publishing could then possibly be sold at a bankruptcy auction.

Even though Sony has the right to match any offer, there’s enough gray area here that the company wants to make sure no one else gets their hands on Jackson’s 50 percent.

The Sony execs who’ve worked on this with the Fortress team have not talked to Jackson. I am told all the work is done through a Bahrainian lawyer hired by Sheik Abdulla bin Hamad Al Khalifa, Prince of Bahrain and Jackson’s benefactor since the singer arrived in the island country last June (Jackson has only been in the U.S. once, sources say, confirming our report from late November that the singer went to Los Angeles briefly).

Prince Abdulla, as he is known, and Jackson are currently at an odd point in their strange relationship. The prince has just returned to Bahrain from London, where he stayed at the Arab-owned Dorchester Hotel.

Jackson has just arrived at the same hotel, after traveling to Germany, Italy and France and winding up at the home of a longtime family friend over the last few days. The two men were not at the hotel at the same time and may not even have seen each other.

The prince, sources still insist, is still planning to launch a record label with Jackson called Two Seas despite definite strain in the relationship. Some of the strain may have come from Jackson, at the prince’s expense, importing about a dozen people from around the world as his Christmas guests and then showering them with gifts. The guests did not stay in the palace and never met the prince, I am told.

As for the record label: "There will be major distribution for the label," a source tells me, and hints that L.A. Reid —- despite having a bad Bahraini experience some months ago — may yet do the deal for Island/DefJam. Sony Music, I am told, is not interested.

All of this is interesting if completed, but several things have to happen first. Among them: Jackson must realize, my sources say, that this new deal does not "save" him. At best, moving the loans is a lateral move to a more hospitable lender. But Jackson will still owe the bank $270 million, and won’t be able to borrow any more money. Interest will keep mounting, as well, which Jackson will have to pay.

And there’s still the issue of the 60 employees Jackson has abandoned at his Neverland Valley Ranch. Today marked eight weeks of no pay. Electricity is turned off on much of the ranch, and there’s no heat or hot water because there’s no gas in the tanks. Ranch manager Joe Marcus is now working only part time at Neverland and living down in Arizona.

But there may be a new problem at Neverland as well. Sources say that in a deposition given last November by Alan Whitman, Jackson’s accountant, it was revealed that Jackson no longer carries commercial insurance or any kind of umbrella policy at Neverland.

This may apply to the animals in Jackson’s zoo, which is why, say the sources, representatives from Marine World visited recently to evaluate the non-human population for adoption.

Considering they haven’t been paid in a while, I’ll bet some of the two-legged types wanted to go as well.

Kiss's Ex-Manager: A 'Secret' Bankruptcy?

The never ending saga of Jesse Hilsen, the jailed former manager of rock group Kiss, moves to bankruptcy court in Brooklyn this afternoon.

You may recall that 65-year-old Hilsen is serving a six-month stint on Rikers Island thanks to Family Court after an 18-month federal prison stint. He’s one of New York’s most famous deadbeat dads and ex-husbands.

Divorced in 1984, Hilsen has never paid a penny of alimony or child support. His kids are now grown, and his ex-wife lives in a shelter. Hilsen was a fugitive from 1994-2004, living in Johannesburg, South Africa, until he returned to the U.S. for medical treatment, where he was arrested by the FBI.

Today’s bankruptcy hearing should be interesting. Hilsen is already in the middle of a bankruptcy that he filed in New York’s Southern District (Manhattan). It only became known during a January Family Court hearing that he’d filed a second bankruptcy in the Eastern District (Brooklyn) last October, thinking no one would put two plus two together. Some of the assets listed on the secret "new" bankruptcy are said to be ones he hid on his first one.

Liv Taylor, Alive and Preaching

Young people may think I’m talking about Liv Tyler, but Liv Taylor is the talented brother of superstar singer-songwriter James Taylor.

In the early '70s, when James was breaking through, both Liv and their sister Kate recorded albums of their own songs and had nice careers. Sadly, they were eclipsed by James. But recently they’ve each issued terrific new albums.

Last night, Livingston gave a nearly two hour show at Joe’s Pub that was so charming, warm and full of homespun humor that it’s too bad he doesn’t do more. Taylor is a modest Southerner, but his often reedy voice has just as much texture as brother James’. He also plays not only the guitar but a decent piano.

The sold out, otherwise one-man show featured Kate Taylor on "Best of Friends" — a duet sung on Taylor’s new album with former sister-in-law Carly Simon — and that was a rare treat.

The Taylors may have suffered some in James’ shadow 30 years ago, but they remain inarguably gifted. They’re also survivors of the '60s, with the scars that show if you look up close but are well hidden beneath their weathered show biz skins and gorgeous harmonizing.

Last night’s show was mostly designed as a launch party for his Chesky Records CD, "There You Are Again," which features a neat gospel number called "Step by Step."

But that didn’t mean that Taylor didn’t perform some of his old numbers, including "Somewhere Over the Rainbow," from his second album. By the way, a little trivia — those first two albums were produced by Jon Landau, before the Rolling Stone writer took off to produce and manage Bruce Springsteen.

Sammy Davis Jr.: Broadway Bound?

I had a nice chat yesterday with Altovise Davis, widow of the truly legendary and remarkable Sammy Davis Jr. She’s on her way to Mohegan Sun Hotel and Casino in Connecticut, where a new musical about Sammy debuts on Feb. 23.

"Mr. Bojangles" is a two-man show designed to feature Sammy’s great hits like the title song, "Candy Man," and "What Kind of Fool Am I?" It also explains how Davis became a role model not only for black America but a universally beloved entertainer.

Altovise says the show will head to London and maybe Broadway, perhaps in an extended version after the Mohegan tryout. "Sammy was so well loved in London," she said, "we have to go there." She’s also hoping to do a bio movie of Sammy’s life, a la "Ray."

A documentary is also under way based on Davis’ two best-selling memoirs, with a release planned for next year. "Sammy can narrate it because we have hundreds of hours of his tapes," his widow told me.

And that’s not all: Altovise, who was married to Sammy from 1970 until his death at age 65 in 1990, is going to write her own book. It will have her own take on Davis’ life with Frank, Dean, Joey and the whole Rat Pack, not to mention the years of their marriage —- when Sammy had his biggest hit with "Candy Man" and made his memorable appearances on "All in the Family."

Crash Goes for 'Broke'

It’s a big weekend in the Oscar world as Lions Gate’s "Crash" will try to overcome "Brokeback Mountain" in the Best Picture voting. "Crash" has a well-oiled machine behind it, and it’s impressive.

Not only has nominated Best Supporting Actor Matt Dillon been everywhere and done everything, but so has co-star Terrence Howard, who’s nominated not for "Crash" but for "Hustle & Flow."

So far the "Crash" publicity campaign has not included my favorite piece of trivia, that writer-director Paul Haggis’ well-liked wife, actress Deborah Rennard, played JR Ewing’s capable, beautiful secretary, Sly, on "Dallas" for about 10 seasons.

She was a big help to me back in 1991 when I wrote a piece for Entertainment Weekly about all the "second tier" players on that show as it was going off the air.

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