Friday, February 03, 2006

PBGC May Take Rennert Hamptons Estate

The PBGC is poised to lay claim to a $185 million five-building, ocean-front estate in the Hamptons with over 100,000 square feet, 29 bedrooms, 39 bathrooms, a 164-seat theater, two bowling alleys, a restaurant-size kitchen, and a garage that holds 200 cars. The estate belongs to Ira Rennert, who built a business empire and fortune by buying distressed companies, often with high-yield junk bonds. One of those companies was WCI which has an unfunded pension obligation of $189 million. The PBGC is threatening an involuntary plan termination and placing a lien on Rennert's house to force him to pick up the tab for the pension plan. This is not the first time the PBGC has gone after the business and personal assets of individuals to satisfy pension obligations. In 1992 it went after Carl Ichan in the TWA bankruptcy.

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