Business Movers: The Missing Mogul | Three Strikes | Episode 2 Summary

Host: Lindsey Graham
Release Date: October 24, 2024
Podcast: Business Movers by Wondery

Introduction

Business Movers delves into the tumultuous journey of Robert Maxwell, a determined yet controversial figure in the media industry. This second episode of the four-part series, titled "Three Strikes," chronicles Maxwell's relentless pursuit to become Britain's most powerful media mogul, juxtaposed against his perennial rival, Rupert Murdoch.

Early Interactions: Maxwell and Murdoch's First Encounter

Setting: Sydney, Australia, 1963
Timestamp: [00:30]

The episode opens with a reenacted meeting between a young Rupert Murdoch and Robert Maxwell at a Sydney restaurant. Murdoch, then expanding his media empire through News Limited, engages Maxwell, the founder of Pergamon Press, in a discussion about acquiring encyclopedias.

• Robert Maxwell: “Encyclopedias, yes. I've managed to acquire some of the finest ever published...”

• Rupert Murdoch: “I do want to expand, of course, Mr. Maxwell, but encyclopedias? I'm not sure it's worth my while to enter an unfamiliar market for a one-time deal.”

Despite Maxwell’s enthusiasm and significant initial offer of 2 million Australian dollars for the encyclopedias, negotiations falter as Murdoch senses Maxwell's desperation and ultimately rejects the partnership. This failed collaboration sows the seeds of future rivalry between the two moguls.

Maxwell's Ascendancy and the News of the World Bid

Setting: Covent Garden, London, January 2, 1969
Timestamp: [15:45]

Six years post their initial encounter, Maxwell makes a bold bid to acquire News of the World, a leading British Sunday newspaper. Confident due to his higher offer, Maxwell expects to prevail over Murdoch's competing bid. However, the meeting takes an unexpected turn.

• Sir William Carr (Chairman of News of the World): “I am not sure Rupert will bring new blood and new energy to our organization as you propose, Mr. Maxwell.”

Frustrated by Carr's biased support for Murdoch, Maxwell attempts to assert his position but faces hostility and mockery from the shareholders. The atmosphere becomes tense as Maxwell passionately defends his bid, but ultimately, the shareholders side with Murdoch, leading to Maxwell's humiliating defeat. This rejection intensifies Maxwell's resolve to succeed in the media arena, believing xenophobia played a significant role in his loss.

The Sun Acquisition Attempt

Setting: Summer 1969
Timestamp: [28:10]

Undeterred by his previous failure, Maxwell sets his sights on The Sun, another prominent British tabloid. This paper, struggling financially, seems like a perfect target. Maxwell negotiates to purchase The Sun for £50,000, contingent upon resolving a labor dispute with the printers' unions.

However, Murdoch, recognizing the strategic advantage of owning both The Sun and News of the World, steps in with a more substantial offer of £80,000. Additionally, Murdoch swiftly resolves the union dispute, securing The Sun for his expanding media empire. Maxwell's second attempt to outmaneuver Murdoch ends in another setback, solidifying Murdoch's dominance in the British newspaper industry.

Crisis at Pergamon Press

Setting: October 1969, Connaught Meeting Rooms, Covent Garden, London
Timestamp: [42:20]

Maxwell's troubles extend beyond failed newspaper acquisitions. An audit uncovers irregularities at Pergamon Press, his scientific publishing house. Maxwell had been artificially inflating revenues by involving subsidiary companies in dubious transactions, aiming to secure a favorable takeover price from American businessman Saul Steinberg.

When the scandal breaks, shareholders are outraged. Despite attempts to thwart the takeover and maintain control, Maxwell faces financial ruin. Pergamon Press UK spirals into debt, and Maxwell is ousted from the company he founded. In retaliation, laborers barricade themselves at his former headquarters, Headington Hill Hall, symbolizing his deteriorating influence.

Maxwell's Resurgence in the American Market

Setting: Early 1970s, United States
Timestamp: [55:50]

Facing adversity in the UK, Maxwell pivots his focus to Pergamon Press's American subsidiary. Leveraging his business acumen, he secures lucrative deals with publishers and academics, driving significant profit growth by 1973. Concurrently, Pergamon UK battles bankruptcy due to Maxwell's strategic withholding of American revenues.

In a strategic maneuver, Maxwell offers to return some of the stockpiled American revenue to Pergamon UK in exchange for a seat on the British board. This gambit allows him to regain partial control, and with the company's stock plummeting, he negotiates a buyback of Pergamon UK in January 1974. This victory restores Maxwell's stature in the publishing world, setting the stage for his next media conquest.

The Battle for The Times and Continued Rivalry with Murdoch

Setting: Early 1980s, Oxford and London
Timestamp: [1:13:30]

By 1980, Maxwell sets his sights on The Times and Sunday Times, Britain's most prestigious newspapers. Despite his previous failures, Maxwell remains undeterred. However, Murdoch, now a seasoned player in the industry, launches his bid to acquire the newspapers, leveraging his experience with The Sun and News of the World to present a compelling case for profitability and efficiency.

Maxwell attempts to thwart Murdoch's bid by rallying support from his parliamentary connections, arguing that Murdoch's acquisition would create monopolistic power and result in significant job losses. Nevertheless, political dynamics, particularly the Conservative government's stance under Prime Minister Margaret Thatcher, favor Murdoch's takeover. In February 1981, Parliament approves Murdoch's acquisition, marginalizing Maxwell once again and reinforcing Murdoch's dominance in the British media landscape.

Venturing into Football: Oxford United and the Thames Valley Royals

Setting: 1982, Oxford
Timestamp: [1:25:15]

In a bid to diversify and boost his public image, Maxwell purchases Oxford United Football Club, rescuing it from bankruptcy. Aiming to elevate the club to the top tier of English football, Maxwell's ambitions face logistical and cultural challenges. He devises a plan to merge Oxford United with the similarly struggling Reading Football Club to form the Thames Valley Royals, anticipating a larger, more lucrative market.

However, the merger faces vehement opposition from players, fans, and shareholders. Legal challenges led by former Reading player Roger Smee delay and ultimately derail the merger, undermining Maxwell's plans. Surprisingly, Oxford United experiences unexpected success in the subsequent season, promoting to a higher league and momentarily restoring Maxwell's reputation as a savior of the club.

The Mirror Group Acquisition: Maxwell's Triumphant Moment

Setting: London, July 4, 1984
Timestamp: [1:40:00]

After years of setbacks, Maxwell makes his most significant move yet: acquiring the Mirror Group Newspapers, which includes the Daily Mirror and Sunday Mirror. Utilizing his strategic patience, Maxwell initiates a behind-the-scenes campaign to garner support within the Mirror Group's board. On July 4, 1984, he announces a formal bid of £80 million, which is initially rejected by Reed International, the group's owners.

Undeterred, Maxwell escalates his offer over dinner negotiations, eventually agreeing to a deal of £113 million. This acquisition marks Maxwell's long-awaited entry into the British newspaper industry, finally positioning him as a formidable media mogul. Demonstrating his characteristic assertiveness, Maxwell swiftly takes control of the Mirror Group, laying the groundwork for his transformation into Britain's most influential media figure.

• Robert Maxwell: “I'm back.”

This succinct declaration during his reappointment as chairman symbolizes his return to power and sets the stage for the next chapter in his media empire.

Conclusion and Looking Ahead

By the end of this episode, Robert Maxwell emerges victorious after a persistent series of attempts to dominate the British media landscape. His acquisition of the Mirror Group represents the culmination of over two decades of ambition, resilience, and strategic maneuvering against a formidable rival in Rupert Murdoch.

Upcoming Insights:
The next episode promises to explore Maxwell's endeavors to expand his media empire further, the complexities he faces in running a major newspaper, and the intricate dynamics of his ongoing rivalry with Murdoch.

Notable Quotes with Timestamps

• Robert Maxwell [00:45]: “Encyclopedias, yes. I've managed to acquire some of the finest ever published...”

• Sir William Carr [15:50]: “I am not sure Rupert will bring new blood and new energy to our organization as you propose, Mr. Maxwell.”

• Robert Maxwell [42:30]: “I'm back.”

Recommended Further Reading

To gain deeper insights into Robert Maxwell's life and his impact on the media industry, the episode recommends the following books:

• The Mystery of Robert Maxwell by John Preston Maxwell
• Maxwell's Fall by Roy Greenslade
• The Outsider by Tom Bower

Production Credits

• Hosted, Edited, and Executive Produced by: Lindsey Graham
• Writing and Research: Scott Reeves
• Executive Producers: William Simpson (Airship), Erin O'Flaherty, Jenny Lauer Beckman, Marshall Louie (Wondery)
• Sound Design: Gabriel Gould
• Music: Lindsey Graham
• Editing: Mohammed Shazi

This summary captures the essence of "The Missing Mogul | Three Strikes | 2" episode of Business Movers, highlighting Robert Maxwell's strategic battles, personal challenges, and ultimate triumph in the competitive world of British media.