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Variety (1995) - Lew Wasserman: Showman of the Century

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Showman of the Century

While ownership of MCA Inc. recently changed hands for the second time in five years, this latest transition signaled something much more significant — the end of an era. Matsushita Electric Industrial Co.'s sale of a majority of MCA to the Seagram Co. for $5.7 billion this summer brought to a close the reign of Hollywood's longest-running management team of Lew Wasserman and Sidney Sheinberg.

Wasserman, the 82-year-old Hollywood legend whose career elates back to the Great Depression, has segued from chairman of MCA after 22 years to chairman emeritus and was named to the board of directors for the Seagram Co.

Wasserman will remain a member of the MCA board and will keep his 15th floor offices in MCA's black tower on the company's Universal City lot.

After devoting the past 59 years to working for or running MCA, the recent turn of events opens a new chapter in Wasserman's life — one that will provide him with time to reflect as well as with time to look forward.

"There's nothing so permanent as change. As tempting as it is to reflect on the past, I've always had a tendency to look toward the future," Wasserman told Variety after the sale of the company to Seagram.

In recent days Wasserman has seemed relaxed, despite months of upheaval that has kept the spotlight on MCA.

The tall, silver-haired Wasserman, whose oversize spectacles have become his signature, takes a laser-sharp view of the advances in an ever-evolving industry and the broadening of the international marketplace.

"The only reason I wish I were younger is because this is just the beginning of this industry," Wasserman said. "The possibilities are limitless; I wish I could be around to see all these changes."

A pioneer in the industry, Wasserman established a code for the talent agency business, merged the worlds of entertainment and politics and was a leader in labor negotiations. Within his own company, Wasserman transformed MCA into a multifacetecl corporation encompassing film, television and music production, theme parks and theatrical exhibition.

Legendary deals

Known as a consummate dealmaker, Wasserman's greatest achievements are almost legendary around town, including that with Jimmy Stewart in 1950 to make "Winchester '73" for 50% of the net and, at the time seen as suspect, the acquisition of Paramount's pre-1948 library. In 1958, MCA paid $10 million for the ownership of what were then considered miles of useless old celluloid. At the time, Paramount crowed that the sale of those 700 cinematic relics produced a greater profit for its shareholders than several years of film production.

But within a week of the sale, commitments for broadcast rights to these old films from TV stations around the country totalled $30 million.

It wasn't long after that coup that Wasserman made an $11 million deal to buy the Universal lot, which was followed by making the Universal City lot and its commissary a tourist attraction.

"Lew literally reshaped the industry when he took over the ownership of Universal and influenced an enormous number of things that are now standards in the industry," said Herb Steinberg, a former longtime MCA exec.

It is Wasserman's status as one of the giants of the industry that prompted widespread criticism of him and Sheinberg being kept out of the loop when it came to negotiations for the sale of MCA. Due to complex confidentiality agreements between MCA and Seagram, an unfortunate secrecy resulted that furthered antagonism that had developed between Wasserman, Sheinberg and their Japanese bosses.

It was Sheinberg, however, who went public with his frustrations over Matsushita's unwillingness to expand MCA through acquisitions and mergers. Matsushita had declined to let MCA make a $600 million bid for Virgin Records and rebuffed MCA's proposal to team with ITT Corp. to acquire CBS.

"Lew and Sid are the pioneers who built MCA and you can't help but be sad when such two extraordinary legends in Hollywood move on and pass the mantle to the next generation," DreamWorks principal Jeffrey Katzenberg told Variety. "I think (Seagram Co. topper) Edgar (Bronfman Jr.) is very lucky that he is going to have both of them by his side to guide him as he takes this company into the 21st century."

Despite Wasserman's obvious dissatisfaction with the way the sale was handled, he said: "I told Edgar that I would do anything he asks. This my life, this company."

Bad blood

Sources suggest, however, that tensions linger between Wasserman and former Creative Artists Agency topper Michael Ovitz, who was not only instrumental in the initial sale of MCA to Matsushita, but also from Matsushita to Seagram, and then was in negotiations himself to take the helm of MCA. The Ovitz-Bronfman deal never materialized, leading Bronfman to instead bring aboard Ovitz's colleague and former CAA president Ron Meyer to run MCA. Ovitz recently announced his plans to join the Walt Disney Co. as president under chairman and CEO Michael Eisner.

Despite the change in ownership and senior management, sources close to Wasserman suggest that he will arrive at his MCA offices each day.

Wasserman arrived in Hollywood from Chicago in 1936, a 23-year-old high school graduate whose career in the entertainment industry was limited to a job as a theater usher and a stint as a press agent for a Cleveland nightclub. He joined Jules Stein's Music Corp. of America as national director of advertising and publicity and a few years later was upped to VP in charge of the new motion picture division.

It was during Wasserman's early days as an agent that he and Stein created the concept now known as "packaging," by not merely booking talent on existing radio programs, but by creating programming featuring a cluster of their clients. Stein and Wasserman worked briskly, signing big-name talent like Bette Davis and buying out smaller agencies. Wasserman made his first million-dollar deal when he signed Ronald Reagan to a seven-year contract at Warner Bros.

"The success of MCA and the business genius of Lew Wasserman are inseparable," said Bronfman upon acquiring the company.

While Wasserman has had a number of inquiries from publishers, he said he has no plans to pen a memoir.

"I was trained by Jules Stein, who looked on clients as a doctor looks on patients," said Wasserman. "I couldn't sleep at night if I were to write about who was sleeping with whom. Yet, as an agent you know and are told things that you wish you didn't know about. At MCA, every agent called every client once a day," Wasserman said.

No kiss and tell

A source close to Wasserman recalls a phone call Wasserman received from Jackie Onassis, who was pitching Wasserman on the idea of penning his memoir. Wasserman retorted: "I don't want to write one, and besides, don't you know we own Puttnam."

Rather than write his life story, Wasserman said he is much more interested in having time to be more involved with charities.

Wasserman, and his wife of more than 50 years, Edie, have given tens of millions of dollars to support a variety of causes over the years.

He is currently on the boards of nine foundations, including the Lyndon Baines Johnson Foundation, the Carter Presidential Center and the Reagan Presidential Foundation. He's contributed to Jewish charities and is a trustee of the Jules Stein Eye Institute at UCLA.

In 1991, the Wassermans donated $5 million to one of their favorite causes, the Motion Picture & Television Fund, with which they have been involved since 1979, and have donated in. excess of $11.6 million over the years. The organization's Woodland Hills hospital boasts an Edie and Lew Wasserman Wing.

Wasserman has also been known to support many politics candidates and political issues dating back to the early 1960s, as well as having forged friendships with presidents Lyndon Johnson, Jimmy Carter and his former MCA client Reagan. It is said to have been a 1963 fundraiser that Wasserman hosted for John Kennedy that was one of the Democrats' first signs that there was support to be had from Hollywood.

Political pals

Wasserman also was known to have had close ties to politicians on the state and local levels, including Texas' Lloyd Bentsen, Massachusetts' Ted Kennedy and former California governor Jerry Brown. The result being that politicians would often consult with Wasserman on pending legislation that might impact Hollywood.

But Wasserman did not only wield influence in the world of politics. His deft business acumen and agenting skills were often called on, most notably to help settle a writer's strike against TV producers in 1960 — and again in 1981. From 1966 to 1975, Wasserman was the chairman of the Assn. of Motion Picture & Television Producers, the industry's official arbitration representative.

It was the confidence that Stein had in Wasserman that helped propel him to the job of chairman in 1973, which marked Stein's official retirement. At the time Wasserman took over, MCA was valued at $160 million. By 1985, Forbes magazine estimated the net worth of MCA at $3.6 billion — and the empire has continued to expand.

It was only five years ago that Wasserman achieved his most lucrative deal, the sale of MCA Inc. to the Japanese electronics giant Matsushita. Wasserman exchanged his 4.95 million common shares of stock for 330 million preferred shares, which carried a face value of $327 million.

The deal would have him collecting dividends of $28.6 million annually at a rate of 8.75%. Additionally, the pact kept him as chairman for five years at an annual salary of $3 million. His contract was due to expire at year's end.

"I think if Lew Wasserman had to buy a ticket, he'd still go in every day," Steinberg said.

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