Ron Perelman, the chairman and chief executive of MacAndrews & Forbes, which is best

known for overseeing Revlon, in his Upper East Side office, where he displays some of
his art collection, including works by Cy Twombly and Giacometti.Credit...Mark
Sommerfeld for The New York Times
SectionsSKIP TO CONTENT SKIP TO SITE INDEX
Account

The Debt King

Ron Perelman seemed to have everything. Until the bill arrived.

Ron Perelman, the chairman and chief executive of MacAndrews & Forbes, which is
best known for overseeing Revlon, in his Upper East Side office, where he displays
some of his art collection, including works by Cy Twombly and
Giacometti.Credit...Mark Sommerfeld for The New York Times
By Jacob Bernstein
 Published Jan. 7, 2022Updated Jan. 11, 2022

Perhaps the most surprising thing about Ronald O. Perelman is he’s one billionaire who
didn’t get richer during the pandemic.

For much of the last three decades, he lived in a townhouse on East 63rd Street that
connects to the offices of MacAndrews & Forbes, the holding company where, as
chairman and chief executive, he lords over a mini-empire of businesses that have
included online gambling (Scientific Games) and supermarket coupons (Vericast), and
were — especially in recent years — less well known than he is.

The exception, of course, is Revlon, the cosmetics colossus Mr. Perelman acquired for
$2.7 billion in 1985 through a hostile takeover. The purchase turned Mr. Perelman into
an emblem of the “greed is good” era and earned him the cachet to shape shift for the
one that followed.

He joined elite boards, had Revlon sponsor the Oscars, filled his townhouse with
artwork by Jasper Johns, Andy Warhol and Cy Twombly, and bought the Creeks, a 72-
acre estate in East Hampton. (The day the Richard Serra sculpture arrived for
installation in 2007, no one could pass through town in either direction, because
Highway 27 was blocked by his trucks).

On a recent Sunday afternoon, sitting in a modernist chair in his office, his knee pressed
against a Giacometti table, Mr. Perelman said Revlon “was never a vanity play.” But he
also can’t deny that in recent years, this midpriced beauty line has been a sinkhole, its
lip glosses and eyeshadows languishing on CVS shelves as customers migrated online to
buy products by Rihanna and Kylie Jenner.

Revlon’s $1.034 billion acquisition of Elizabeth Arden in 2016 was financed largely with
loans that grew to $3 billion. Vericast had loans totaling almost as much. And a number
of those loans were secured by Mr. Perelman’s properties, artwork and toys. When the
pandemic hit and Revlon’s share price fell from $24 to $5, the banks closed in. He began
divesting.

Off went a Miró and a Matisse, which sold for a combined $39 million. As well as a
Giacometti sculpture that Sotheby’s sold in a private sale where the minimum bid was
$90 million. A second Hamptons estate, which was owned by Mr. Perelman and
occupied by his second wife, Claudia Cohen, until her death in 2007, went on the market
for $115 million, though the amount he (or the banks, depending on whom you ask) will
receive for it in an upcoming deal, according to people with knowledge of it, is closer to
$80 million.

“Far less than it’s worth” was all Mr. Perelman would say.

He got rid of two jets and placed his 280-foot superyacht on the market for $106
million. Princeton University, to which Mr. Perelman had pledged $65 million to go
toward construction of a new residential college, announced in 2021 that the building
would no longer be named in his honor when he failed to meet the original payment
schedule.

As Mr. Perelman cast it to Bloomberg News in 2020 when reports of his financial

situation first surfaced, his decision to sell belongings was driven by the challenging
economic moment, a desire to live a less leveraged lifestyle, and shifting priorities,
including becoming more of a homebody since he married his fifth wife, the psychiatrist
Anna Chapman, in 2010.

Still, even his friends had questions.

They’d seen him out looking gaunt. He was walking with a cane. Was he sick? Was he
now only worth a few billion dollars? Or was he actually broke?

“I’ve vacationed with him many times, I talk to him a lot,” Irving Azoff, the music
impresario, said, “but he’s very private and we haven’t discussed this. I read the party
line and I don’t know.”

‘We’re all complicated, we’re all crazy.’

Although what happened to Mr. Perelman is a story about losing money, it is also a
parable for how the game is rigged for those at the top. Here was a very rich man who,
despite having a failing business, repeatedly went to the banks for billions of dollars in
loans he may never fully pay back. And got them.

But among the 0.1 percenters who take advantage of endless banking tools, Mr.
Perelman remains a figure of fascination: incredibly well known, difficult to define.

On the one hand, he is plainly attracted to the spotlight, hosting Apollo Theater fund-
raisers at his Hamptons estate where he plays drums onstage with musician friends like
Pharrell Williams and Alicia Keys. On the other, he set MacAndrews & Forbes up in
ways that colleagues say are designed to evade public scrutiny.

Pharrell Williams with Mr. Perelman at an annual fund-raiser he hosts at his East
Hamptons estate, in 2016. Mr. Perelman has been known to show off his drumming
prowess at musical events.Credit...Kevin Mazur/Getty Images
Philanthropic achievements made him the beau ideal for plutocrats as renaissance men.
Combustible relationships with family members and business colleagues risked turning
him into New York City’s second-most-famous tabloid billionaire.

A 79-year-old cannonball of testosterone whose micromanagement of employees helps

explain why Revlon is on its 10th C.E.O. in 36 years (currently it’s his daughter Debra
Perelman), Mr. Perelman is bored by sports, waxes poetic about Dries Van Noten, goes
to a therapist, donates to Republicans and is, by his own admission, attracted largely to
women whose identities cannot be sublimated by guys like him.

He is also an Orthodox Jew. “You just get a get,” he said, referring to the Jewish
religious tradition in which a rabbinical court grants permission to divorce.

Of his five marriages, three have ended in ugly divorces.

“We’re all complicated, we’re all crazy,” he said.

‘I would say that’s probably accurate.’

Mr. Perelman grew up in Elkins Park, Pa. His mother, Ruth, did not work outside the
home, and Mr. Perelman said she was no pushover. His father, Raymond, was a steel
magnate and something of a tyrant.

By the time of Ronald’s bar mitzvah, his father — who owned the firm Belmont Iron
Works — was already bringing him to business meetings, Mr. Perelman said.

After high school, the younger Mr. Perelman went to Villanova University for a
semester, then transferred to the Wharton School at the University of Pennsylvania,
where he was a legacy.

The Great Read

More fascinating tales you can’t help but read all the way to the end.
 Garage doors, a straightforward finishing touch, have become a source of woe for the
home-building industry, thanks to supply-chain issues.
 Was the “Russian flu” of the late 19th century actually a pandemic driven by a
coronavirus? And could its course give us clues about our pandemic?
 Our reporter hid seven tracking devices in her husband’s belongings to see how
invasive they were and which ones he would find.
Mr. Perelman’s family wasn’t particularly religious. At 18, Mr. Perelman went to Israel
and had a spiritual conversion. On another trip he met Faith Golding, a young real
estate heiress whose family owned the famed Essex House in Manhattan, and who soon
became his first wife.

After receiving his M.B.A. from Wharton in 1966, Mr. Perelman went to work for his
father. But he yearned to become Belmont’s chairman, and Raymond had no interest in
relinquishing the title. So Ronald left. He and his father barely spoke for several years, a
detail that helped establish a narrative of him being mostly self-made, despite it flying
somewhat in the face of reality.

Ms. Golding’s fortune helped Ronald get his business started. When Revlon tumbled,
Raymond Perelman stepped in and provided him access to capital.

Mr. Perelman’s first deal in New York was the acquisition of Cohen-Hatfield, a jewelry
company then trading on the American Stock Exchange for a fraction of its book value.
He obtained control of it in 1978 with a $1.9 million bank loan and by 1980 made $15
million breaking it apart.

Relationships he’d developed with executives at Drexel, Burnham, Lambert — the

epicenter of 1980s junk bonds — led to more leveraged buyouts. Among them were
MacAndrews & Forbes (a maker of candy and licorice extract), Technicolor (the film
processor), Consolidated Cigar (the largest manufacturer of cigars in the United States)
and Pantry Pride (a supermarket chain that he bought shortly after it emerged from
bankruptcy).

Mr. Perelman and Ms. Golding moved to 740 Park Avenue, the Gold Coast’s most
exclusive co-op. She stayed home with their four children. He had an affair with an
Upper East Side florist.

Was it true that the affair came to light when Mr. Perelman bought his mistress jewelry
from Bulgari, and the bill — mailed home — was opened by his wife?

“I would say that’s probably accurate,” he said. “But I really knew it was over when she
showed me a scrapbook filled with pictures that she’d gotten from a private
investigator.”
Image
Mr. Perelman sits on the steps of his office, beside a sculpture by Pedro Reyes. He
started his career working for his father’s firm, Belmont Iron Works.Credit...Mark
Sommerfeld for The New York Times

Le Cirque Perelman
Mr. Perelman never much liked his late-’80s Gordon Gekko-like reputation.

He’d collected art since college, went to Sam Cooke shows on the weekends (never until
after the Sabbath), and didn’t talk much about business. “That’s the fun of him,” said the
actor Michael Douglas, who in addition to playing Gekko is a good friend of Mr.
Perelman’s.

Nevertheless, the showdown at Revlon — a takeover The New York Times described in

1985 as “one of the pivotal corporate battles of modern times” — bore resemblances to
“Wall Street.”

Revlon was founded in 1932, and grew to become the second largest makeup company
in the United States, behind Estée Lauder. In 1975, Revlon’s founder Charles Revson
died, and its new chief executive, Michel Bergerac, used revenue from Revlon’s makeup
and skin care lines to expand into health care products and medical testing equipment.
Those things did well while the beauty business languished. By 1983, the stock sank,
trading around $35, putting Revlon’s overall market cap far below its worth, if acquired
by raiders and sold off piece by piece.

Enter Mr. Perelman, who, in addition to having access to financing from Drexel
Burnham, had recently acquired Pantry Pride, from which he obtained a $300 million
tax-loss carry-forward that could be used to offset future income from another
acquisition.

Mr. Perelman tried at first to charm Mr. Bergerac into joining his takeover effort. When
that failed, he deployed the same public relations strategy used by Gordon Gekko, who
in “Wall Street” presents hostile takeovers as a public service on behalf of the everyday
investors whose portfolios are being decimated by profligate executives. Mr. Bergerac,
as Mr. Perelman later told it, lived arguably “the biggest life of any C.E.O. in America,”
flying around the world on a 727 he didn’t need, backed by executives with palace-like
offices.

One might argue that this was the pot calling the kettle black.

Mr. Perelman took MacAndrews & Forbes private in 1983. One reason for this,
according to “The Predators’ Ball,” by Connie Bruck, was that he wanted to have his own
plane and have his artwork in his office. He wanted to have MacAndrews & Forbes “as
his nest egg,” she writes, “and then he wanted to acquire some other public company, for
presenting his face to the financial world.”

The extensive efforts of Mr. Bergerac and his board to keep Revlon away from Mr.
Perelman failed. After Mr. Perelman acquired it in November 1985, he broke from form
by selling off the strongest part of the business while holding onto its weakest link.

Away went National Health Laboratories, an unglamorous but rapidly growing blood
and pathology testing unit that went on to become Labcorp, today a $30 billion S&P 500
company. What remained was Revlon, which, with debt more than five times its $600
million market cap, became an infinity pool of sunken money.

People loved her …

Sometime after Mr. Perelman moved out of 740 Park Avenue, a woman at Le Cirque
caught Mr. Perelman’s eye.

Her name was Claudia Cohen.

She was the heiress to the Hudson News empire and a former editor of The New York
Post’s Page Six, who later joined ABC as a correspondent. The best and worst thing
about her as a journalist was that people loved her.
Mr. Perelman married Ms. Cohen in January 1985. When he took over Revlon, she
became his essential sounding board. He hired Richard Avedon to shoot ad campaigns.
Cindy Crawford, Paulina Porizkova and Christy Turlington appeared in them.

Don Johnson met Mr. Perelman when Revlon sponsored one of his speed racing
competitions. Melanie Griffith, then Mr. Johnson’s wife, received a Revlon contract.
Image
Mr. Perelman and his second wife, Claudia Cohen, who died in 2007 of ovarian cancer,
attend a party to celebrate Donald Trump’s book “The Art of the Deal.”Credit...Ron
Galella/Ron Galella Collection via Getty Images

In 1992, the two couples were vacationing in Paris and arranged to have dinner. Before
it was to take place, Mr. Johnson bumped into the movie producer Mike Medavoy and
told him to come along with his wife, the Democratic fund-raiser Patricia Duff.

Mr. Johnson didn’t really want to talk to a reporter about what came next. “Mike’s still a
friend,” he said.

But suffice it to say, two divorces were soon underway, and Mr. Perelman and Ms. Duff
were soon engaged.

She provided Mr. Perelman access to people in the world of President Bill Clinton while
his philanthropy career took off.

In 1994, he donated $10 million to the Guggenheim and was praised for not asking to
have his name put on a building. He also gave a consulting gig to Webb Hubbell, the
former associate attorney general under Mr. Clinton, who had been indicted on a charge
of tax fraud, and was under pressure to supply Kenneth Starr, the Whitewater
independent counsel, with information about the Clintons’ business dealings from their
time in Arkansas. (Mr. Hubbell ultimately pleaded guilty to a single count of tax fraud.)

No one could say with certainty if that was why, in 1995, Mr. Perelman was appointed by
Mr. Clinton to serve on the board of the Kennedy Center, one of the most prestigious
posts in American philanthropy.

But the timing was … the timing.

And in 1998, when the Clinton administration was trying to keep the president’s affair
with Monica Lewinsky under wraps, it was Mr. Perelman who offered her a job.

“I had no idea,” Mr. Perelman said, when asked if he knew the real reason Vernon
Jordan, a fixer for the president, sent Ms. Lewinsky to him.

“Anyway, the job offer was rescinded when news of Ms. Lewinsky and Mr. Clinton’s
affair came to light. Clearly, it wasn’t going to be such good public relations to have her
in Revlon’s public relations department.”

The toes that got stepped on.

People from Mr. Perelman’s team will tell you he is one of the most generous people
they have ever met. People from the opposing one will tell you he is vicious. The truth
may not be that he is one or the other but both.
Expensive watches are given to employees, trees are planted in parks to honor friends’
dead relatives, and wars ensue with those who cross him. In those circumstances, a
principle is usually involved: money.

“Ronald is fierce, fierce, when it comes to people just making the assumption that
because he was reported to have a lot of wealth, that they could just go and take it,” Mr.
Johnson said. “Some of the toes that got stepped on deserved to be stepped on.”

In 2012, Mr. Perelman sued his art dealer, Larry Gagosian, claiming he’d been
repeatedly induced to spend more for works than they were worth. In 2013, Harland
Clarke, another Perelman company, sued Michael Milken over a deal. Mr. Perelman said
it wasn’t personal, but still. Mr. Milken was — as the former head of high yield securities
at Drexel, Burnham, Lambert — largely responsible for turning Mr. Perelman into a
billionaire.

Both suits were dismissed.

Less well known: Mr. Perelman is an easy crier.

It happened in the offices of MacAndrews & Forbes during a recent interview as he

talked about the end of his marriage to Ms. Duff. In 1996, less than two years after she
gave birth to their daughter, Caleigh, Mr. Perelman broke up with her in the back seat of
a chauffeured car, while attending the Democratic National Convention.

That isn’t the part that made him cry.

After returning home, Mr. Perelman called his ex-wife, Ms. Cohen. He was staying at his
Creeks property. She was at their old dive on Lily Pond Lane, which is 9.5 acres.

Mr. Perelman and Ms. Cohen were not then in a great place. In addition to the way the
marriage ended, he had made plain his antipathy for the man with whom she
rebounded. In retrospect, Mr. Perelman acknowledged that wasn’t necessarily fair, even
if the man is the former New York senator Al D’Amato, to whom personal and
professional scandals clung, as The Los Angeles Times once put it, “like a sweaty
undershirt.”

“She said, ‘come over,’ and we talked pretty much all night,” Mr. Perelman said, his lips
quivering, eyes welling up. “And she never said a word about me giving her a hard time.
We just held one another, and I talked about what a jerk I was. After that everything was
like before.”

Although not entirely. They weren’t romantically involved.

But she helped him through his epic, three-year divorce with Ms. Duff and stood beside
him seven years later when his fourth marriage, to the actress Ellen Barkin, ended. (Also
not well: “The last time I saw Ellen, she threw a drink in my face,” he said.)
When Ms. Cohen was diagnosed with ovarian cancer, Mr. Perelman poured money into
research he believed could save her. After her death, in 2007, he had her name put on
Logan Hall at the University of Pennsylvania, to which he was a major donor, and where
she had also gone to college.

To Ms. Cohen’s friends, he seemed like a hero. Then, in 2012, he helped mastermind a
lawsuit that his 23-year-old daughter, Samantha Perelman, filed against her uncle,
James Cohen, over the amount she inherited from her grandfather Robert Cohen. The
suit went to trial, where she lost.

Image
Mr. Perelman, fourth from right, is joined by cultural figures, city officials and Michael
R. Bloomberg, fourth from left, in 2021 to sign the final beam at the topping ceremony
for the Ronald R. Perelman Performing Arts Center at the World Trade Center, a
90,000-square-foot three theater building currently under construction.Credit...Diane
Bondareff/Associated Press

Strategic alternatives
One good way to avoid being the target of a leveraged buyout is to keep the bulk of a
company’s shares held back from the public. Mr. Perelman owns more than 85 percent
of Revlon’s.
Its largest outside investor is Mittleman Investment Management, a firm in Melville,
N.Y., that puts its clients’ money into so-called undervalued companies.

Despite repeated efforts, its chief investment officer, Chris Mittleman, has never been
granted a meeting with anyone at Revlon.

In an interview, Mr. Mittleman sounded like a man who has wasted so many years in a
loveless marriage, he no longer has the will to leave it, and thus waits for it to be ended
for him, either by God, death or a tender offer from Estée Lauder. “That would be an
outstanding buyer,” Mr. Mittleman said.

Mr. Perelman has, over the years, “explored strategic alternatives.” Most recently, in
2019, he hired Goldman Sachs to look into it. But a deal never got to what Mr. Perelman
calls “the right place.”

Still, it has occurred to Mr. Mittleman, along with others, that perhaps the reason Mr.
Perelman never sold Revlon is that he has no interest in doing so, and instead floats the
possibility as a way to buy time with bondholders — a debt-laden billionaire’s equivalent
of “the check is in the mail.”

Revlon, a number of them pointed out, is a huge part of his identity. And retirement, he
said, is “the beginning of the end. I want to be active until I’m 120.”

In December, Bloomberg News reported that Raymond Perelman, in the last years of his
life, extended to Ronald a loan for over $120 million from a nonprofit family foundation
registered at MacAndrews & Forbes’s offices.

In addition to the fact that federal laws discourage this sort of thing, it was surprising
since Mr. Perelman’s record in philanthropy was, even with a few bumps, pretty storied.

“I’m not going to talk about it,” he said of the Bloomberg article. (Michael Lehmann, a
lawyer for Mr. Perelman, said previously that the transactions referred to in the article
were “first vetted and approved by skilled and experienced outside legal and tax
counsel.”)

In 2016, Revlon hired Citigroup to put together a loan package for $1.8 billion, which
was then amassed from a group of investment firms, with almost all of its holdings
provided as collateral. It largely restricted Revlon from obtaining further loans. Or was
supposed to.

When things went even further south, Revlon, in 2019 and 2020, worked out deals with
a subset of those lenders to obtain $1 billion more, this time serving up the company’s
intellectual property as collateral. Which is the corporate equivalent of getting a
mortgage on your house and then, when you cannot make the payments, going back and
getting a mortgage for the land underneath.
A number of the lenders who did not provide additional capital revolted. They filed a
fraudulent conveyance suit against Revlon and Citigroup, accusing them of “theft.”

Mr. Perelman said the suit was without merit and, as evidence, noted that it was
dismissed. It was — though not for reasons having anything to do with its central
allegations.

In August 2020, administrators for Citigroup accidentally wired Revlon creditors the

entire remaining balance on the 2016 loan. The wrong box got checked and out went
$893 million. When Citigroup’s efforts to retrieve the money failed, no need existed for
the lenders to continue their own lawsuit against Citigroup and Revlon. “The lawsuit
was withdrawn solely because Citibank paid off the loans and not because the
allegations were anything other than meritorious,” said Benjamin Finestone, a lawyer
for the plaintiffs.
And because the error was Citigroup’s, the loss belonged to them, rather than to Mr.
Perelman. But he still had to do what his friend Richard Parsons said in an interview
was “a lot of fast footwork.”

Image
Mr. Perelman wants to stave off retirement. “I want to be active until I’m
120.”Credit...Mark Sommerfeld for The New York Times
The beachfront property in the Hamptons formerly occupied by Ms. Cohen went onto
the market. People from Sotheby’s arrived to collect Mr. Perelman’s art, much of which
sold at the bottom end of estimates.

One possible reason is that Mr. Perelman had a habit of trying to get a bargain on
everything, according to three art-world figures who insisted on anonymity because they
said that commenting on the situation could harm their jobs. This enabled him to get
good paintings by great artists, they said, while missing out on masterpieces that begin
with sticker shock and ultimately reap the biggest rewards.

“There may be something to that,” Mr. Perelman said. “But I never had anything on my
walls I didn’t really love.”

At any rate, he’s not blaming his former dealer, Mr. Gagosian.

“I had dinner with him the other night,” Mr. Perelman said. “One day, I just picked up
the phone and said, Look, we haven’t spoken for years but I don’t even know what our
fight was about. Do you want to forget about it? He said, ‘I’d like nothing better.’ (Of
course, a billionaire with hundreds of millions of dollars worth of art to sell and a dealer
capable of selling it have good reason to reunite.)

Mr. Perelman also sold off his interests in A.M. General (which makes Humvees and
other military equipment) and Scientific Games, for a combined amount of about $1.6
billion. Mr. Perelman denied that the Creeks is for sale, though at least two real estate
brokers indicate that it is.

Mr. Perelman said he is healthy and nearly free of personal debt. “I am not sick, I am
not broke,” he said.

Although Revlon continues to have over $3.25 billion in debt, it has been extended to
2024, enabling it to stay out of bankruptcy. And MacAndrews & Forbes remains on East
62nd Street, next to two buildings he owned that were bought for $35 million by the
Chapman Group, a real estate company that is owned by his wife’s family.

The Chapman Group even got one of those properties for $10 million, which, given that
Mr. Perelman bought it in 2004 for $14.5 million, is a substantial discount.

Construction is also continuing on the Ronald O. Perelman Center for the Performing
Arts, a 90,000-square-foot three theater building at the World Trade Center. The
project is being shepherded by Michael R. Bloomberg, the former mayor of New York,
who said there’s no plan to take Mr. Perelman’s name off that building.

“He’s making his payments,” Mr. Bloomberg said.