Charney Purchase of UPI



Here's excerpts from the UPI message wire in 1992 about the possible purchase of UPI from bankruptcy by Leon Charney:


Leon H. Charney and Pieter VanBennekom today held a news conference in New York City to discuss the Thursday announcement of Charney's interest in buying all or parts of UPI.

Charney said he has several partners, including the president of Perry Ellis Enterprises and two Swiss residents. Basically, he said he decided to do the deal Wednesday night, after learning that Pat Robertson had withdrawn his bid. He vowed to maintain the integrity of the UPI news reports, if he proceeds with the formal purchase of the company.

Here are excerpts:

Charney said he thinks he could "transform some of the fundamental ways that they do business into a speedier technology. In other words, transform UPI from the 20th century to the 21st century through some supertechnology. . . . Conceptually, we know what we want to do and we're going to test the markets.

"We think that there are assets that have been underutilized at UPI which could be utilized in a more profitable way, and therefore balance out some of the negative cash flow that inevitably you get in news reporting business.

"It's a very tough business to be a news reporter.

"I myself personally with our show have been in Desert Storm, and Bahrain during the war, and I know how expensive it is to keep newsmen moving, and journalists. I have empathy. I carry a press card. I'm with you guys.

"I've been in Israel during the scudding, and I've been in Russia during the putsch. So I've been on your side of the road. And I know how difficult it is.

"I have tremendous respect for reporters because many of them have risked their lives. Many photographers have risked their lives. We've worked with them in the Desert Storm story, the scudding and in Russia during the coup.

"It's a very tough job. You put your lives out there. You work very hard. Then one day you wake up and find out that the capital isn't there to fund you and you're out of jobs. And I have great empathy for reporters. .

"On the other hand, we do live in a capitalist society and it has to be a profit center and somewhere in between we have to find the mix."

Charney identified his partners as Michael Floersheim, a Swiss resident, Ernst Strauss, a Swiss from Zurich, who has a Ph.D. in engineering and is a private investor; Elliot Levgne, president of Perry Ellis Enterprises.

Charney currently moderates "The Leon Charney Report," a public affairs program seen Sunday nights on a public station in New York City owned by the municipal government. The show has been on the air for four years, he said.

"It's basically a current affairs show, with a lot of tilt towards the Middle East, where I was very involved advising President Carter and Ezer Weizman and Yitzak Rabin and the late Menacham Begin on how to achieve peace in the Middle East, which is something very storng and vital in terms of my interests.

"I should point out to you that I have very close relationships with a lot of friends in the Arab world. So, in no way should any implication be made that if we do acquire the UPI that there would be any tilt or bias. It would maintain its integrity as a news organization and we in no way would editorialize the news reporting.

"I just want you to know there are a lot of press reports about me being very involved with Israel, which is true. But I know what it is to have integrity as a journalist. So I want to wipe that right off the floor.

"We would keep the integrity of this organization journalistically in place.

"We don't know what we will find. We will do our best to see if we can put this together in a very profitable way. I'm extremely sympathetic to reporters. I don't like to see them out of work.

"As I said before, You must look, and I owe a duty to my investors, to look at this as a business venture."

In the question and answer session, Charney said he became interested in buying UPI when a television network correspondent, a friend of his, told him of the failure of Robertson's bid for the company. He did not identify the correspondent.

Charney called VanBennekom, and offered to talk for nine days, providing $180,000 to cover operating expenses.

UPI's success, he said, depends on "the economic viability." Charney will be in Washington next week, to assess UPI's assets.

Charney told VanBennekom: "We'd like to have you not close this for nine days.

"It's a gamble on our part. We have gambled $180,000. It's non- refundable, so we've taken a big shot and we've paid for it. We've paid for the privilege of sitting with Pieter.

VanBennekom said: "It is up to me, publicly, to express my gratitude to Leon for the institution of UPI, to the employees of UPI, and I think to the information and news industry around the world that in my opinion would be worse off with the disappearance of a resource like UPI. I do want to stress that I thank Leon for that."

Charney said, "I'm not informed enough today to know what to do and what not to do. I stress to you that I'm very sympathetic to people having jobs, especially reporters, but again we have made no commitment to purchase. We don't have a firm contract. We don't have a $6 million deal like Robertson did. We've put up good faith money for an option for nine days . . . for the right to examine the books. We've held the organization together.

"I don't think I'm a white knight, as someone described me. I think this is a businessman's decision, made by us, and our partners. I hope we can keep everything together. I think news is very important. I think having competition in news is very important. I think having new ideas come from different sources is very important.

"I think competition in news is very healthy.

"It scares me a little bit to see the contrition of news organizations. Personally, I don't like to see that. I like to see the competition out there.

"That's not to say that I'm going to go out and fund something that's losing whatever it's losing every month. I'd be foolish.

"It's evidently not been making money for a long time. Had it had been making money, it would not be in bankruptcy court and I may look foolish, but I hope I'm not stupid. If something's draining money, how much can you afford to pay for the drain?

"What you need to do is become creative and stop the drain."

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