Milken Vows to Help Revive Dying Shipyard : Role Unclear; Deal Dates to Several Months Ago
Michael Milken, the “junk bond” financier who is fighting federal racketeering and fraud charges, has vowed to join another battle: raising money to revive a dying Massachusetts shipyard.
Milken, who was charged last month in a 98-count indictment capping an extensive government investigation, made a surprise appearance Thursday before 700 former shipyard workers at the Sons of Italy hall here.
Milken told the group that he and Drexel Burnham Lambert Inc., the investment firm that has agreed to dismiss him, could easily secure the millions of dollars in capital and bonds needed to finance an employee-owned shipbuilding and repair operation at Quincy’s Fore River shipyard.
“By June 30, the money will be lined up for the yard,” he said.
Milken said he would help with the shipbuilding venture, but his role in the venture was unclear.
On Friday, a personal spokesman for Milken and an official speaking on behalf of Drexel appeared to disagree over Milken’s current role in the deal.
Agreed to Disassociate
The firm has agreed to disassociate itself from Milken under an April 13 landmark civil fraud agreement with the Securities and Exchange Commission settling charges including insider trading. Milken also would be barred from any business dealings with Drexel employees.
The pact, signed April 13, is pending approval by a federal judge, but Drexel already has placed Milken on a leave of absence.
The Drexel official said Milken was “peripherally” involved in the shipyard financing deal several months ago, before the firm agreed to settle government charges against it. But the spokesman said Milken “is not working on the deal now and is not involved in it.”
Milken spokesman Kenneth Lerer confirmed that Milken appeared at the Rockland meeting “as a private citizen” and that he is continuing to play an active role on behalf of the union in structuring the deal. “He has a commitment to do as much as he can to help the union revive the shipyard,” Lerer said.
Lerer said he wasn’t certain how much contact, if any, Milken would have with Drexel in structuring the deal. He noted that the SEC settlement hadn’t gone into effect yet, adding that Milken personally isn’t bound by it.
