Who holds the record for the most expensive divorce of all time? If you had asked me yesterday, I probably would have said Rupert Murdoch. Back in 1999, Rupert paid his ex-wife of 32 years, Anna, a settlement valued at $1.7 billion. But I wouldn't have been 100% certain that Rupert's settlement was actually the largest of all time because we never found out the exact final amount that Russian billionaire Dmitry Rybolovlev paid to his ex-wife Elena. At one point a Swiss court ordered Dmitry to pay Elana $4.5 billion, which was 50% of the value of his fertilizer business. After seven years of fighting, Dmitry and Elena ultimately settled on undisclosed terms, likely far less than $4.5 billion. Was it more than $1.7 billion? Enough to claim the record for most expensive in history? We may never know. But thanks to some news today, Dmitry's settlement amount doesn't matter in terms of records. Jeff Bezos is about to absolutely obliterate all divorce settlement records probably for the rest of history.
Jeff Bezos is the richest person on the planet with a net worth of $136 billion. This morning Jeff and his wife of 25 years MacKenzie announced that they are getting divorced. In a shared statement, the couple explained:
"We want to make people aware of a development in our lives. As our family and close friends know, after a long period of loving exploration and trial separation, we have decided to divorce and continue our shared lives as friends…"
It's not totally clear how much this is going to cost Mr. Bezos, but it certainly will not be cheap and it almost certainly will obliterate all divorce records.
They have been married for 25 years, since 1993. Crucially, that's one year BEFORE Jeff founded Amazon. As such, it's basically inarguable that MacKenzie is entitled to 50% of Jeff's Amazon stake and everything else they have acquired as a couple over the last two decades. Jeff's 16% stake in Amazon comprises roughly 95% of his $136 billion net worth. The remaining 5% comes from investments in other companies, including an early stake in Google that is worth around $1 billion.
***Update***
Later in the afternoon on January 9, it was revealed that Jeff allegedly revealed the divorce after learning that the National Enquirer was about to release a story detailing his ongoing relationship with another woman. That woman is former LA news anchor Lauren Sanchez. Lauren married super agent Patrick Whitesell of William Morris Endeavor back in 2005. Lauren and Patrick apparently broke up in late 2018 after she informed him of her relationship with Bezos. The National Enquirer reportedly has photos of the secret couple that were taken over a four month investigation.
Jerod Harris/Getty Images
Had Jeff founded Amazon 10 years before he met MacKenzie, perhaps he would have been able to make the case that she would not be entitled to half of his empire. But even if that were true, she would still be entitled to half the value of any assets and income that were earned and acquired during their marriage as a result of that empire. For example, under this scenario if Jeff sold a billion dollars worth of stock to buy homes and jets and other businesses, MacKenzie would be entitled to half the value of those assets. Just not half the value of Jeff's Amazon stake. But that's clearly not the case here!
When TV super-producer Dick Wolf divorced his second wife Christine, he had to pay her half the value of Law & Order because the show was created during their marriage. Fast forward two decades and Dick is now divorcing his third wife Noelle. Dick and Noelle married after his TV career was launched so she is definitely not be entitled to half the value of the TV empire. She'll still get tons and tons of money. Just not insane mega money.
MacKenzie Bezos will get insane mega bananas bonkers ridiculous money. Potentially $60 – 70 billion. If she gets exactly half of Jeff's current $136 billion net worth, $68 billion, she'll instantly rank as the 5th richest person on the planet. Jeff owns 79 million shares of Amazon. If she receives around half, she'll likely end up the second largest Amazon shareholder ahead of mutual fund Vanguard which owns 6% of all shares. She will almost certainly not receive cash from Bezos or from the sale of her own shares because both actions would tank the price of the stock.
An interesting similar divorce case is that of casino mogul Steve Wynn. Steve and Elaine Wynn were married from 1991 to 2010. When they divorced, Elaine agreed to take a 10% stake in the company as opposed to forcing Steve to sell shares and pay her a cash settlement. She also agreed not to sell her shares and would instead live off the company's annual 3% dividend. A 3% dividend on a $2 billion stake typically equated to around $60 million in income per year for Elaine.
This arrangement was golden for many years. It allowed Steve to continue running the business without losing his majority stake and without the threat that some major rival investor would gather up a 10% stake and start bossing him around. Elaine lived off the clip and would go about her life.
According to legend, the Wynn's arrangement turned sour in 2014 after Elaine reportedly went to Steve and asked permission to sell around half her stake. Why was she looking to sell? Again, according to legend, she was looking to make a bid to buy the LA Clippers which was for sale, after owner-at-the-time Donald Sterling's racist tapes were made public. Elaine was supposedly putting together an all-female team of investors that included Oprah Winfrey to buy the NBA franchise.
When Elaine approached Steve, he reportedly denied her request.
Elaine was not happy. She sued the company and Steve. She accused both of reckless spending and covering up years of sexual harassment allegations against Steve. She was ultimately successful in ousting Steve from the company when the harassment allegations hit the front page of every newspaper in America.
Steve was forced to liquidate his entire stake in Wynn which left Elaine as the company's largest individual shareholder . She hasn't sold her stake, though she could if she wanted to now.
Hopefully that won't happen with Jeff and MacKenzie, but I do foresee them pursuing a similar arrangement where MacKenzie is given an enormous stake in Amazon but maybe without voting power. If I'm Jeff Bezos, I'm happy to give my ex-wife half my equity, I just don't want her calling the shots and approving/disapproving every decision I make for the company.
But who knows! Maybe MacKenzie wants full voting power and input. I personally can't wait to see how they figure this all out!
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