Inside Baseball: Rattner > Quadrangle > Cerberus > MAXIM?

Robert Farago
by Robert Farago

Steve Rattner recently surrendered his position as the head of The Presidential Task Force on Automobiles (PTFOA). Seems Steve-a-rino must attend to a little mess down in The Empire State. More specifically, NY AG Andrew Cuomo suspects that Rattner’s Quadrangle Group paid a $1.1 million bribe to political consultant Hank Morris to secure megabucks from the New York Pension Board. The Treasury Department immediately spun Rattner’s resignation as a normal part of the PTFOA’s new role as Chrysler and GM’s more silent partner: “Steve’s decision to leave is the first step in a planned scaledown of the task force and there will of course be more departures in the future. It was always part of the plan to downsize once Chrysler and GM emerged from bankruptcy.” So how many other bureaucrats on the [now] 24-member PTFOA have left government employ? None. Meanwhile . . .

Rattner’s Quadrangle mob have jumped out of bed with the same group that the PTFOA allowed to maintain control of Chrysler Financial Services—despite running the Chrysler mothership into the ground without assuming ANY financial liability for the American automaker’s collapse. Yup, Cerberus.

Two years ago, Rattner’s Quadrangle group formed a company called Alpha Media to buy “lad mags” MAXIM and STUFF, and music title BLENDER from UK publishing maverick (a.k.a. “eccentric”) Ron Dennis. Alpha Media shelled-out $250 million for the three titles. Quadrangle’s “stake” in the deal: a $100 million loan from Cerberus.

As the PTFOA’s Chrysler “rescue” proved, Quadrangle and Cerberus are BFFs. (Not to mention Cerberus’ cozy relationship with The Fed, which green-lighted a last-minute lender-into-banker billion dollar bailout for Cerberus’ GMAC debacle.) But this Alpha Media deal went south faster than a migrating flock of supersonic ducks.

As the mag biz continued its downwards trajectory, Alpha Media folded Stuff into MAXIM. Blender dried-up and died. Thanks to the ongoing rise of the Internet and the sudden decline in MAXIM’s ad revenues (468 vs. 249 ad pages in the first six months of 2005 vs. 2009), the Alpha dog is on its last legs. As The Post reports, Quadrangle has now defaulted on its Alpha Media debt, leaving Cerberus holding the bag. [joke deleted]

Yes, the company that tried to strip and flip Chrysler is now running a magazine based on tits and ass. More to the point, Steve Rattner used other people’s money to take a stake in a failing, outmoded industry, just before the market tanked. Then walked away without a scratch went the deal went bad. Sound familiar?

Robert Farago
Robert Farago

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  • PeteMoran PeteMoran on Jul 20, 2009
    I think an even funnier movie would be to put Michael Moore into a real job, where he actually had to work for a living. That would be hilarious. It would be a shame for his non-thinking sheeple detractors that it probably still wouldn't help them handle what he has to say however.... BTW, massive Mike doesn’t treat his employees very well. I say that about my boss too, but only when I'm approached by Fox News/CNN/GOP with their cheque books in hand... You know, especially the bosses that have sacked me....
  • Bunter1 Bunter1 on Jul 20, 2009

    Hey RF, This is pushing into NSFW territory again. A bit of cheesecake is fine, let's not get carried away again. Thanks for listening. Bunter

  • 3-On-The-Tree I don’t think Toyotas going down.
  • ToolGuy Random thoughts (bulleted list because it should work on this page):• Carlos Tavares is a very smart individual.• I get the sense that the western hemisphere portion of Stellantis was even more messed up than he originally believed (I have no data), which is why the plan (old plan, original plan) has taken longer than expected (longer than I expected).• All the OEMs who have taken a serious look at what is happening with EVs in China have had to take a step back and reassess (oversimplification: they were thinking mostly business-as-usual with some tweaks here and there, and now realize they have bigger issues, much bigger, really big).• You (dear TTAC reader) aren't ready to hear this yet, but the EV thing is a tsunami (the thing has already done the thing, just hasn't reached you yet). I hesitate to even tell you, but it is the truth.
  • ToolGuy ¶ I have kicked around doing an engine rebuild at some point (I never have on an automobile); right now my interest level in that is pretty low, say 2/5.¶ It could be interesting to do an engine swap at some point (also haven't done that), call that 2/5 as well.¶ Building a kit car would be interesting but a big commitment, let's say 1/5 realistically.¶ Frame-up restoration, very little interest, 1/5.¶ I have repainted a vehicle (down to bare metal) and that was interesting/engaging (didn't have the right facilities, but made it work, sort of lol).¶ Taking a vehicle which I like where the ICE has given out and converting it to EV sounds engaging and appealing. Would not do it anytime soon, maybe 3 to 5 years out. Current interest level 4/5.¶ Building my own car (from scratch) would have some significant hurdles. Unless I started my own car company, which might involve other hurdles. 😉
  • Rover Sig "Value" is what people perceive as its worth. What is the worth or value of an EV somebody creates out of a used car? People value different things, but for a vehicle, people generally ascribe worth in terms of reliability, maintainability, safety, appearance and style, utility (payload, range, etc.), convenience, operating cost, projected life, support network, etc. "Value for money" means how much worth would people think it had compared to competing vehicles on the market, in other words, would it be a good deal to buy one, compared to other vehicles one could get? Consider what price you would have to ask for it, including the parts and labor you put into it, because that would affect the “for the money” part of the “value for money” calculation. An indicator of whether people think an EV-built-in-a-used-car would provide "value for money" is the current level of demand for used cars turned into EVs. Are there a lot of people looking for these on the market? Or would building one just be a hobby? Repairing an existing EV, bringing it back into spec, might create better value for the money. Although demand for EVs is reportedly down recently.
  • ToolGuy Those of you who aren't listening to the TTAC Podcast, you really don't know what you are missing.