The High-Beta Rich by Robert Frank

Author:Robert Frank [Frank, Robert]
Language: eng
Format: epub
ISBN: 978-0-307-58991-0
Publisher: Crown Publishing Group
Published: 2011-10-31T16:00:00+00:00

Initially, Tim and Edra tried to keep the divorce civil and private. But like many divorces involving rich people, it quickly devolved into a spectacle of public attacks and money battles. Tim accused Edra of being a steroid-addicted alcoholic who had a long history of overspending. He said she had flown her house cleaner on the Gulfstream to their various properties and spent $90,000 on a divorce party that featured Tim’s likeness on voodoo dolls and rolls of toilet paper.

“She has been recklessly spending money as if it grows on trees,” he said in one press release, urging a Montana court to liquidate her assets.

In the spring of 2008, the Blixseths put the Yellowstone Club up for sale and inked a deal for $400 million. It fell through as the real estate market crashed. Property sales at the Yellowstone Club ground to a halt.

With their business collapsing, the Blixseths settled their divorce by dividing up all their holdings. Edra got the club, Porcupine Creek, and the French castle. Tim got the Mexican resort, the Turks and Caicos property, and tens of millions of dollars in cash.

Along with the club and the house, Tim also gave Edra the most important item on their balance sheet: the Credit Suisse debt. She agreed to take over the promissory note that she and Tim had signed saying they owed the club $209 million.

Edra said it seemed like a fair deal at the time. She planned to sell their French castle to keep Yellowstone running until she could turn around the business or find a buyer. Yet the deal to sell the castle to a Russian oligarch collapsed and she ran out of cash. Yellowstone filed for bankruptcy in 2008 and sold for about $100 million—less than 10 percent of its appraised value in 2005. Because she was personally on the hook for $209 million, she filed for Chapter 7 personal bankruptcy.

Tim appears to have escaped any real damage from their financial wreck. Even though he’s being chased by creditors demanding his properties to pay back the loan, Tim shows little regrets for his spending spree, his lifestyle, his debt, or the long line of angry club members and former business partners who are suing him or no longer talking to him. If he went a little too far during the good times, well, so had plenty of other rich people.

“It was fun back in the go-go years, to have all the stuff you don’t need and always wanted,” he said. “Anyone who says they didn’t have fun isn’t telling the truth. The whole world was living like that.”

Edra had more of a reckoning, both financially and psychologically. Back when she was rich, her daughter would joke about Edra’s fantasyland of privilege and isolation. It was a world unto itself, she said, one that Edra fully controlled and yet one that also failed to give Edra some of the real connections—to people, to family, to experiences—that she so craved. During one conversation, Edra made a joke about a politician who needed to “get back to the real world.

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