Citizen Turner

How Captain Ted Snatched victory--and untold millions--from the worst deal of his life

Ted Turner's fist slammed down on the lectern, startling the noontime crowd that had gathered to hear him late last year at Washington's National Press Club. "They're holding me back!" he exclaimed. Turner looked out over the audience, his blue eyes narrowing. "I'll tell you one thing: We ran a story on clitorectomies. Most people don't know about it, but millions of women have their clitorises cut off before they are ten or 12 years old, so they can't have fun in sex. Between 50 percent and 80 percent of Egyptian girls have had their clits cut off. You talk about barbaric mutilation. . . ." He leaned toward his audience as if sharing a confidence. "Well, I'm angry. I'm being clitorized by Time Warner."

The crowd laughed in disbelief.

"That's exactly right," Turner plunged on, "and I don't like it any more than those women do. If Egyptians think it's bad for women to want sex, then why don't they cut off the heads of the little whackers of the ten-year-old boys over there, too, and make it an even-steven deal? . . . I want to play in the big game. I don't want to be pushed around anymore."

You'd think that Ted Turner--who already has seven networks, three movie companies, a dozen homes, a huge chunk of Montana, a warehouse full of sailing trophies and an aerobically toned cinema goddess for a wife--has just about everything a man might want to make him happy. But here he is at 56, his hair now silver, his face craggy, ready to embark on yet another battle. It's the latest in a war Ted Turner has been waging for more than a decade--a war to gain control of a major Hollywood studio and a major broadcast network. And make no mistake about it, Ted Turner is never happier than when he is at war.

Half visionary, half crackpot, Turner is an all-American character. Entrepreneur, risk-taker, thrill-seeker, hard-changing winner, lover of fast boats, fast deals and even faster women--tabloid Ted Turner is all of these. He's the wild man of American business. But he is also something more.

Like Carnegie and Rockefeller, the robber barons of the 19th century, or Ford and the other assembly-line princes of the early 20th century, Turner is a magnate for his time--a media tycoon for a media age. He has been called one of the three most important men in the history of television. Muscling his way into our living rooms with his Cable News Network, he has changed the way we look at the world. From the war in Iraq to the O.J. Simpson trial, people everywhere--secretaries and secretaries of state--are watching history as it unfolds through the eyes of CNN. And Ted Turner owns those eyes.

His story, filled with ups and downs, is a tale of sailing triumphs and marital failures, of bold and outrageous deals, each one riskier than the last. It's the story of a man who took a small UHF station in Georgia and--using the business precepts his father had instilled in him at the end of a coat hanger--built it into an $8 billion global media conglomerate.

Behind the rise of this American tycoon is a simple motto, a business goal he can state in six words: "I would like to own everything." What he needs today are the same things he has needed since the early Eighties--a bigger supply of shows to put on the air and a bigger audience for those shows. In other words, a major studio and a broadcast network. That's why he's been talking mergers and acquisitions for almost 15 years. That's why he tried to buy out CBS in his famous hostile takeover bid in 1985. And that's why, after the spectacular failure of the CBS attempt, MGM/UA owner Kirk Kerkorian knew the time was ripe to give him a call. He knew that Ted Turner wasn't about to pass up another opportunity to expand his empire.

The MGM deal, as it unfolded, was a classic example of the Ted Turner way of doing business, the style that has marked his career from the earliest days--a style of high-profile mega-deals, of quick-draw decisions and intense battles, big wagers and big mistakes that, more often than not, somehow turn out OK in the end. In its successes and in its failures, Turner's purchase of MGM would lay the foundation for the shape of Ted Turner's empire today.

Only a few days after the CBS deal collapsed, Kerkorian was on the phone with Turner. A quiet, low-key financier, Kerkorian had made a fortune in the airplane business, and he understood timing. Turner was still smarting from his CBS loss, so much that he wouldn't even admit that he had lost. He was still talking about proxy fights.

"Ted," Kerkorian said, "I admire what you've tried to accomplish with CBS. Let's see what we can do with MGM." Kerkorian had owned the old Metro-Goldwyn-Mayer film studio since the late Sixties. Through the early Eighties, he and Turner had been meeting about four times a year, trying to form a strategic partnership or a united company. On one September evening in 1982, Kerkorian and three of his senior executives went to Manhattan for an early dinner with Turner at the New York Yacht Club. In fine form, Ted--a successful defender of the America's Cup in 1977--showed the group around the club (the same club that had once blackballed him), regaling them with stories of the great regattas.

When the group finally settled down at a table in the darkened dining room, Turner, as always, was full of ideas: "Could we carve out two hours each night at TBS and just run MGM films? Could we carve out the weekends for MGM?"

While no immediate plan came out of this dinner, Turner was clearly captivated by the notion of teaming up with MGM. His father had taught him that, in America, certain names stood for quality: in magazines, National Geographic; in TV, CBS; in movies, MGM.

So in July 1985, when Kerkorian spoke again with Turner on the phone, he knew he had an interested buyer, even if, on paper, MGM was no winner. In fact, the company had just posted a $66 million loss. As wily a deal maker as Kerkorian was, his movie track record had been poor. Through the early Eighties, the studio had run off a string of box-office flops. On July 25, Kerkorian told Turner that if he acted quickly, he could have MGM/UA for $1.5 billion. "But," he added, "I don't want to sit here forever and not know whether I have a deal or not." In fact, he didn't even want to wait two weeks. Putting the screws on, Kerkorian declared he would give Turner until August 6 to decide. After that, he was selling MGM at auction.

With only two weeks to make a decision on the biggest deal of his life, Ted sent Turner Broadcasting into a maelstrom of activity. Forty lawyers and accountants, under chief financial officer Bill Bevins, were dispatched to MGM headquarters in Hollywood to examine the company's financial records.

At the same time, Turner called a directors' meeting to sell the MGM deal to his board. But even this essentially rubber-stamp group of Turner's friends and employees had serious reservations. They wondered if their chairman was overreaching, and feared he was being led astray. "The directors' meeting at which MGM came up was like a baited trap," one director recalls. It was a question of ego. After losing CBS, there was no way Turner could turn down the challenge. "He couldn't avoid it. He had to go for that goddamn deal."

Turner had plenty to say that day in Atlanta, and he spoke with passion. He didn't like TBS' strategic position. To be a long-term player in this business, he said, you either had to grow in viewership (the CBS deal) or in the programs you owned (the MGM deal). And TBS wasn't strong enough in either: "It's essential to have this additional programming to make TBS competitive," he said. "We gotta do this to survive."

He described just how valuable the MGM movie library would be to superstation WTBS, his core business. "Movie fees are rising," he said. "Every time we sign a new contract to air films, it's more, more, more." Profits would keep shrinking. But imagine owning all of those classic films. "How can you go broke buying the Rembrandts of the programming business when you are a programmer?" he asked.

Turner was determined to step up to the big league. "It's a business where are disappearing," he would say later. "I want to be one of the survivors. We need to do this," he said. "Let's get on it." And the board anxiously went along.

On August 7, 1985 Turner signed a purchase agreement with Kerkorian to buy MGM/UA for the asking price of $1.5 billion, or $29 a share. The deal would include the MGM studio, the fabled MGM lot in Culver City, California and, most important, a library of more than 3500 MGM films, including 1450 films from the old Warner and RKO studios--such classics as Gone With the Wind, The Maltese Falcon and Citizen Kane. Turner called the package a tremendous business opportunity and an "exceptional fit with the group's long-term business plan."

Others were less generous. On both coasts, in Hollywood and on Wall Street, at Ma Maison and at the Four Seasons, guffaws could be heard. The way show-business executives figured it, Turner, the overly eager naïf, was going to have his pockets emptied on (continued on page 130)Ted Turner(continued from page 102) this one by the shrewd Kerkorian. The price of $1.5 billion was $200 million to $300 million too high. Newsweek reported that in Hollywood, "Turner is almost universally regarded as 'a pigeon."' One film-business analyst declared that the movie studio was only worth that much if "Turner has found oil on the MGM back lot."

After the signing, some members of the TBS board started to worry. Mike Gearon says, "I felt that all of a sudden Ted had gotten in over his head. We weren't being properly informed. We had inadvertently given Ted too much authority--we had said he had the right to negotiate with a lot of latitude. But we were responsible for whatever the hell he did. And the price seemed to exceed the representations that had been made to us on the board. I thought there was a lot of directors' liability at that point--the company could be destroyed."

According to Gearon, Turner was concerned too. "I just think that he was prepared to take the risk, and I probably wouldn't have been prepared. It was a lot to lose."

If the board was anxious, and if Hollywood was amused, that Ted was paying the asking price without even haggling, it was not an unusual move for him. An optimist, he always seems to imagine that what he's purchasing may actually be worth the price he pays. "Because he believes he sees hidden values, he pays more," former CNN president Reese Schonfeld says.

"Ted used to say his father had told him that if he really wanted something, if he had to have it, it didn't matter what he had to pay," recalls former TBS entertainment president Gerry Hogan. "In that context, Ted would spend huge amounts of money, more than was necessary. But on a day-today basis, he was very cost conscious." That was Turner's pattern--pay whatever the cost, then wring every nickel out of the purchase.

Two days after the MGM deal was put in motion, as his board fretted and his aides tried to hammer out the details, Turner suddenly took off with his family to fly-fish on a north-country river in Alaska. It was standard operating procedure for Ted: As soon as a plan was laid out, he would lose interest and move on to the next thing. The currents surging past his legs, the line singing through the morning sky, the fish rising to the lure, Turner concentrated on rainbow trout and Alaskan sockeye and let others worry about taking care of his business.

At the core of the MGM deal was the king of junk bonds, Michael Milken of Drexel Burnham Lambert. If Drexel executives were "highly confident" that they could arrange the billion and a half dollars in financing for Turner's purchase, theirs was not a totally disinterested opinion. They had a huge stake in the proceedings. Because of the speed of the deal, Turner had been forced to retain Milken, Kerkorian's own moneyman. Milken was working both sides of the street--getting paid as MGM's banker and as TBS' financier. It was a highly unusual setup, and it raised conflict-of-interest questions. Ironically, though, if it hadn't been for Milken's stake in the sale, the buyout probably would never have happened, for Drexel Burnham was one of the few firms able to raise money for such a speculative transaction. In retrospect, the MGM/TBS deal--from the players to the financing--would come to be emblematic of the high-risk, highflying Eighties.

But first the buyout had to happen, and as Variety would later say, "The deal began unraveling before the ink was even dry." Between mid-August and late November, four new MGM films bombed. In fact, two of the four lost almost $29 million of a $30 million investment. Bevins returned to Atlanta shaking his head and, face-to-face with his boss, declared, "Look, we've got a problem here." It came to be a recurring refrain. Later he said, "When you suffer the kinds of losses we suffered at the studio, the financing becomes a virtual nightmare."

On October 31, 1985 The Wall Street Journal reported that "there seems to be an atmosphere of urgency, if not panic" at TBS. Turner, never a recluse, began to talk with anyone who could give him a desperately needed infusion of cash. Time Warner, ABC, Gannett, Viacom and others met with him over the next year, all trying to bite off pieces of TBS and MGM. Italian media tycoon Silvio Berlusconi, Time Warner's Nick Nicholas Jr. and HBO's Michael Fuchs also talked with Turner.

Rupert Murdoch was among the most eager to cut a deal. If there was anyone on the media scene whose ambitions paralleled Ted Turner's, it was probably the Australian magnate. In the same year that Turner had gone after CBS and MGM, Murdoch and partner Martin Davis had acquired 20th Century Fox and a mininetwork of six Metromedia stations. However, unlike Turner, Murdoch impressed investors with how efficiently and cheaply he did it. Murdoch and Turner met early in 1986, when Murdoch tried to hire Gerry Hogan. Hogan decided not to leave Ted, but he introduced the two men, and they met again three or four times over the following months.

On one of these occasions, Murdoch traveled to Turner's office in Atlanta. Adjourning downstairs for dinner at Bugatti, Turner, Murdoch, Turner executive Robert Wussler, Bevins and Barry Diller (then head of Fox) tried to find a sensible way to blend Fox and MGM/TBS. Quiet and understated, Murdoch kept his focus on the numbers: "What if we sell off this piece of MGM?" he'd ask. Turner, meanwhile, was talking about the big picture, the big ideas: "We could be the biggest thing in Hollywood," he would say. "We could build more networks. If we put your library and our library together. . . ."

Cordial and intensely deal-oriented, Turner and Murdoch nonetheless attacked the same problem from very different angles. "Ted was this wild idea guy." Gerry Hogan recalls. "Rupert is a tremendous financial guy. He understood numbers and the ways to get things done financially far better than Ted. Ted doesn't have many strengths in that area. He relied on Bevins to make those things happen. What Ted had was vision--how powerful the combination could be, how important."

But on this particular evening the conversation fell apart because of Barry Diller. According to Hogan, the chemistry between Diller and Turner was terrible. "I don't think Diller wanted any part of Turner," says Hogan. "I think the merger would have been a direct assault on Diller's position. If Turner and Murdoch had merged, it would have cut into Diller's area."

That night after the meeting, Hogan flew back to New York with Murdoch, who was still trying to sort out the finances. According to Hogan: "Murdoch was intently serious in trying to make the numbers work, but he was having a tough time because both companies had so much debt that it was as if two punch-drunk fighters were trying to hold each other up. In the end, it just couldn't be done."

(continued on page 156)Ted Turner(continued from page 130)

The deal that came closest to happening was with Allen Neuharth and his Gannett Co. (an owner of newspapers across the country, including USA Today). Neuharth was eager to merge with TBS. He would be able to expand into cable TV and film, his newspapers and CNN could share resources and Turner would get the cash he needed. "That deal was the road to Easy Street," says Wussler. Nervous members of the board urged Turner to take it. "Ted," one of them said, "you can walk off with $800 million in Gannett stock. Maybe that's the safe course to take." The merger seemed so likely that when Neuharth and his aides flew down to Atlanta, Turner introduced them to staffers as "my bosses."

But then Turner started to have second thoughts. "He got nervous," Wussler remembers. "He said he wasn't sure." Half of the problem came from Ted's philosophical objections to the Gannett businesses: "Ted is antiprint," Wussler says. "He thought newspapers would be dead in ten years. Ted's ecological sense was against newsprint, something you read each day and throw away."

In part, then, the eco-Turner sank the lucrative Gannett deal. But he'd also been following the same methods he had developed over the years. He had often flirted with prospective partners for his billboard company in the mid-Sixties, and for CNN in the early Eighties, allowing them to think that they had bought the companies. Then, taking their offers to his bankers, he was able to demonstrate his firms' value in order to borrow more money. Whatever the reasons, Ted Turner fundamentally believed that the companies were his, and he had no intention of sharing them with anyone.

•

By late 1985 Turner's position was beginning to look more desperate. Not only was he short of money, but NBC--once a CNN suitor--continued to envisage a cable news service of its own, in direct competition with CNN. The NBC venture was still alive when Turner telephoned John Malone to ask him to back Turner Broadcasting, a cable stalwart, against this network interloper. Turner needed Malone, the head of TCI and perhaps the most powerful of all the cable operators (the man Vice President Al Gore once labeled "the head of the cable Cosa Nostra") to stay in business. "I wouldn't just disappear," Turner said. "I would sell the company. Because there's no way [I can survive] with MGM hanging over my head and all that additional debt."

On this occasion, Malone and the cable industry stood behind Turner. They recognized how important his brand names (CNN and TBS) were to their businesses. By boycotting NBC's cable news, Malone and his peers put the venture out of business by February 1986.

It was lucky for Turner that they did, because on the West Coast the MGM deal was looking worse than ever. By now, two more movies had been released, 9-1/2 Weeks and Dream Lover, and both had failed miserably at the box office. Turner tried to put a brave face on it. "Mr. Kerkorian is no dummy," Ted said. "He knew what he wanted to sell, and what he sold was the troubled part of the company. . . . But I have always bought troubled things. Normally, things aren't for sale if they're in great shape. Right?" Still, as Bill Bevins would later admit, they hadn't realized just how bad things were: "In 20-20 hindsight, the fact that the studio was in free fall was not all that clear at the time."

It was not until late March 1986--after eight months of frantic negotiations, eight months of fund-raising and junk-bond sales--that the Drexel team was finally able to find enough high rollers (or bottom feeders) to finance the MGM purchase. Relieved and ecstatic, Turner arrived in L.A. and hurried to Milken's office. After the congratulations, he asked Milken, Bevins and staffers from TBS and Drexel to join him at the conference table. And then, as if feeling the need to sanctify the moment with a New Age twist, he asked these hardened businessmen, in their rolled shirtsleeves and loosened ties, to clasp hands around the table. Looking sheepish, the financiers complied, and as they joined hands, Turner led them in directing their energies toward the outcome of the deal. Milken was bemused by the whole scene, but he wasn't about to forget the bottom line. According to Robert Wussler, Milken announced to Turner and his men, "Oh, by the way, our fee is now $140 million."

"Wait a minute," snapped a member of the Turner group. "We agreed to $80 million."

To which Milken replied, "Yeah. I changed it to $140 million."

On March 25, 1986 Turner publicly announced that he had completed the purchase of MGM (selling UA back to Kirk Kerkorian), and once again the industry reacted with amusement, perhaps more now than before. "It's one of the nuttiest deals of all time," said one analyst, laughing. Another joked, "Ted Turner came to town fully clothed and left in a barrel." Even The Wall Street Journal declared the new TBS-MGM "one of the most debt-ridden companies of its time."

The figures did look scary. Together, TBS and MGM had pulled in only $567 million for the nine months ending September 1985, yet they were obliged to pay $600 million within the next six months. Even worse, the way the deal was set up, if Turner failed to reduce his debt within those six months, he would have to start paying Kerkorian in TBS stock. Thus, with each payment, Turner's control of his company would dwindle. "Kerkorian thought he'd end up owning TBS," says board member Mike Gearon. "He thought he was going to get Turner." Eventually, Kerkorian might have a chance to sell MGM all over again.

The clock was ticking now, and Turner came close to losing everything he had worked to build. "Drexel has put a gun to Turner's head," one banker said. "I think he's in terrible financial difficulty," said another. "Unless he has some plan that no one knows about, one that's so creative no one has ever thought of it, he can't do it. The whole empire could come crashing down."

In public, Turner put on a brave face, actually bragging about how much he now owed--nearly $2 billion. "That's more than [the debt of] some smaller Third World countries," he boasted to a group of business leaders in Davos, Switzerland. "I'm pretty proud of that. Today, it's not how much you earn but how much you owe." On another occasion he would declare: "I owe $2 billion. Actually, it's closer to $1.9 billion, but I like the sound of $2 billion better. That's a million dollars a day in interest. No individual in history has ever owed more. Here, look at my picture in today's newspaper. Do I look worried?"

But at home, with his friends and family, Turner would admit that for all his devil-may-care pronouncements, he was worried. One night, with his mother Florence and some neighbors, he stood up in the middle of dinner and started pacing. "Goddamn it!" he said. "I've really done it this time." He shook his head at his predicament. "I may have really done it. Maybe I shouldn't have gone into MGM. But that library is great." His mother, sitting tall in her chair, smiled reassuringly at her son.

Turner paced some more. Then, stopping suddenly, he threw up his hands. "How the hell am I going to pay that $2 billion?" he asked.

"Teddy!" his mother exclaimed, her smile fading. "Did you say $2 billion?"

"Sure," said Turner. "I told you it was gonna cost $2 billion to get MGM--if I can find the damn money."

"Oh my," she whispered. "I thought you said $2 million."

As Turner traveled out to the MGM lot in Culver City, he clearly felt the pressure of the passing days. Walking through the main gate and under the famed entrance arch, with its roaring MGM lion, he had one overwhelming problem on his mind: How was he going to hang on to this place, and keep himself in the movie business?

These next months would be pivotal. The strain that Turner was under caused him to explode from time to time. One afternoon he was talking with Nick Nicholas and other Time Inc. officials as they made their way through the MGM parking lot. As Turner walked, he sketched out his plans for some of the films in the MGM library. "Well, Ted," they pointed out casually, "you know we've leased a number of those films."

It turned out that HBO had already signed deals at low rates for several MGM movies. "They're locked up," they said. Turner glanced wildly from one executive to another, suddenly realizing that he hadn't even investigated these details. "Goddamn it!" he roared. Turning toward the nearest car in the parking lot, he started kicking its tires furiously.

In a calmer moment Turner would admit, "I've never done anything like this before. It's like sailboat racing in a hurricane. It's like being in an airplane in a storm. You buckle your seat belt."

Once again, Turner began looking for ways to raise money and talking with almost anyone who would listen. He tried unsuccessfully to persuade Steven Spielberg to come in and run MGM. He talked about mergers and combinations with a number of companies. The Murdoch and Gannett conversations were ongoing, though nothing would come of them. And now two film companies, the Cannon Group and Lorimar-Telepictures, were offering to take parts of MGM off his hands. Turner had wanted to hold on to the MGM studio lot and make his own motion pictures. In fact, according to aides, he was mesmerized by Hollywood and deeply wanted to be a part of it. Still, the one thing he absolutely had to have was the MGM film library.

In early June 1986, Turner invited a group of his business friends--John Malone, Nick Nicholas and Michael Fuchs, among others--out to the MGM lot. He took them on a tour of the studio and invited them back to the Irving Thalberg building for cocktails. That's when the conversation turned serious. What did Ted intend to do? How could he get out of this predicament?

"It remains one of the most incredible business meetings I ever had," recalls one of the participants, "because everyone was sort of seeing if they could get a piece of the action." Several parallel conversations were going on at once, as these high-powered executives discussed the different options Turner could pursue with TBS and MGM. Meanwhile, Turner furiously scribbled numbers on the back of an envelope, trying to see if there was any way he could hang on to the studio. One of the executives remembers, "I was thinking about the way our company would do it--9 million accountants, 10,000 lawyers. Here was Ted, doing this deal on the back of an envelope."

As the executives quizzed him about MGM's financial situation, it became clear how much Turner didn't know. "What's the future home-video value of those films?" they asked. "What are the contracts with the distribution companies?" Wussler recalls, "It was like 'Ted goes to film school."' After an hour or two, it became obvious to everyone that Turner didn't have the answers. So they told him, as gently as possible, that as of that moment, it was not a business for which he was prepared. And, says Wussler, "they were correct. We were too shallow, too overextended." In the 53 weeks during which Turner would be involved with MGM, the studio would bring out a total of nine movies, all flops, and lose about $65 million.

That night, when Malone, Nicholas, Fuchs and the others left, Turner still hadn't made a final decision. But by June 6 he had agreed to perhaps the only decent option he had: to sell almost everything back to Kirk Kerkorian--the MGM studio, the video business, even the MGM lion logo--for $300 million, substantially less than Turner had paid for it just three months earlier. The studio lot and the film laboratory went to Lorimar for $190 million. That left Turner with only the library, for which he still owed well over a billion dollars. "Kerkorian had taken him bad," says one of the cable executives who had just visited with Ted.

But what upset Turner the most, as he struggled with his decision in the main suite of the Thalberg building that night, was the fact that he would never get to make his own movies, never bring out his own Gone With the Wind or Singin' in the Rain, his own Philadelphia Story or Ben-Hur. There he was, sitting behind the executive desk in the MGM glamour factory--"More Stars Than There Are in the Heavens"--and the glamour would never be his. He had come so close to running a studio, but somehow it had all gotten away from him. There, on the MGM lot where so many great movies had been filmed, there with the ghosts of Gable and Garbo and Garland looking over his shoulder, Ted Turner watched a piece of his dream slip away. He put his head down on that great wooden desk and cried.

•

Later that night, only a few hours after sorting through the most painful business reorganization of his life, Turner showed up in the dining room of the Beverly Hills Hotel. More than one cable kingpin who had been with Turner earlier that afternoon and witnessed him dismantling the MGM movie empire stopped by his table to offer condolences. They came away amazed at his ebullient mood. Ted was, after all, about to suffer the worst financial setback of his life. But he had no time for regrets. "You don't look back," he drawled, flashing his gap-toothed, what-the-hell grin. "You gotta look ahead."

For all Turner's optimism, ahead didn't look any better than behind. Even after selling off items such as the MGM studio, the lion logo and the video business, to say nothing of the studio lot and the film laboratory, he still had a crushing debt of more than $1 billion and no way to pay it off. Plus, TBS stock would fall to about half its value.

Over the next year, Turner would cast about for money, turning finally to the cable operators. In June 1987 his customers became his partners, giving him $562 million for 37 percent of TBS. While Turner played the deal as a victory ("I don't consider it a rescue at all"), the cable CEOs who joined his board were much more hard-nosed. "That was not Ted pulling off a coup--that was Ted being rescued," said one. "At the time, the MGM deal was a mistake. I mean, if you say 'I just made a deal that required me to give away half my company,' when that wasn't the intent of the deal--well, it might work out in the future, but at the time it was clearly a miscalculation."

The price of the miscalculation was that the new board members from Time Warner, TCI and other cable companies had acquired veto power over any Turner move involving more than $2 million--in short, any major move at all. Ted's seat-of-the-pants style was going to have to change. He was about to be reined in by the cable operators, and he knew it. For all his jokes, Turner was heard to mutter as he wandered around his office, "I've lost control. . . . I've lost control." He had broken his father's cardinal rule: Never give up pieces of your company.

In the past eight years, Turner has chafed many times under his board's constraints as it has blocked his expansion moves time and again. Bids for the Financial News Network, MGM (yet again), Orion and NBG have been squelched. And it was, of course, just this past year that he complained the board had "clitorized" him.

But the irony is that this same board has contributed mightily to Ted Turner's success today. The directors helped provide a structure, an organization, financial discipline for Turner's visionary drive. Even more important, in 1987 he became inextricably tied to the future of the cable industry--the heads of cable's biggest companies now had a financial stake in him. And they could make sure Turner would succeed by helping him launch new networks such as TNT, then guarantee him millions of viewers.

And succeed he did. By 1989, in one of the most dramatic turnarounds in American business, Ted Turner, the man who "left town in a barrel," was now being called Captain Comeback. His stock shot up, tripling, quadrupling, quintupling in value. Turner now had three of the six most watched networks on basic cable and was earning record profits. His own holdings neared the $2 billion mark. "He's on a roll," said both The Wall Street Journal and Business Week.

Perhaps the most startling indicator of Turner's extraordinary success was the lawsuit filed against MGM directors by angry MGM minority shareholders. Once inclined to joke about how Kerkorian had fleeced him, they were now fuming at Turner's achievement in marketing the film library and creating new networks. MGM, they insisted, had been sold too cheaply. It was they, not Turner, who had been cheated in the deal.

Yet Turner's desire for a studio and a network would not go away. Like an itch that he had to keep scratching, Turner returned again and again to the failures of the CBS and MGM deals. And each time he was blocked by his board of directors. "When you have two ten-ton gorillas controlling him," said one executive, "he can have all the conversations he wants, but nothing ever goes anywhere." Though Time Warner and TCI had a stake in Turner, they didn't want him to get too big.

It was only in August 1993, after a series of threats, bluffs and complaints in the media, that Time Warner blinked and allowed Turner to enter the motion picture business with the $900 million purchase of New Line and Castle Rock--a small studio and a boutique production company, respectively. New Line had produced such youth-pleasers as Teenage Mutant Ninja Turtles and the Nightmare on Elm Street series. Castle Rock had had success with In the Line of Fire and When Harry Met Sally. It wasn't exactly the big time, but it was the fulfillment of a dream. Finally, Turner was going to be able to green-light movies of his own.

Today, Castle Rock, New Line and their parent Turner Pictures anticipate turning out about 40 movies a year, and Turner is spending money lavishly, the way the old movie moguls did. Turner Pictures has also joined the Motion Picture Association of America, making it the eighth "major" studio, albeit a minor major. Turner continues to be interested in acquiring one of the other seven majors. And he is still very much trying to gain control of a broadcast network, an NBC or a CBS, because Ted Turner simply does not know how to quit.

There is a story about the time some 20 years ago when Turner was running down the main street of Anderson, South Carolina on his way to a business appointment and was struck by a car. Preoccupied with the sales pitch ahead, he just bounced off and kept right on running.

Two decades later, Ted Turner is still running. And despite his recent clitorization scare, there seems to be no stopping him.

Two days after the MGM deal was put in motion, Turner suddenly took off with his family to fly-fish.