Usually, when an individual is elected president of the US, it transpires that they sell off any business interests they control in order to avoid the appearance of conflicts of interest. Presidents typically entrust their assets in blind trusts so they can't accidentally enrich themselves with a new law or policy. President Donald Trump has been a unique example. He likely could not have liquidated his complex portfolio of real estate and brand assets, so he has entrusted his company in the hands of his children. A similarly complicated situation could arise if Democratic presidential hopeful Mike Bloomberg wins the 2020 election. Specifically, it might be very difficult for Mike to find a buyer for his financial services company, Bloomberg LP, a company that includes media assets, financial tools, and much more. The former mayor of New York City addressed this question in a recent radio interview.
Mike Bloomberg's Wealth and Business Strategy
Mike Bloomberg, a well-known businessman and former mayor of New York City, is currently in the spotlight regarding the potential implications of his business interests if he were to become president. During a Radio Iowa interview, he was asked about the fate of his company should he win the election. His response was quite candid: "I think at my age, if selling it is possible, I would do that…At some point, you're going to die anyway, so you want to do it before then." This statement reflects the challenges faced by high-profile individuals with significant business interests.
Bloomberg's company, Bloomberg LP, is a huge financial services firm that generates an estimated $10 billion in annual revenue. Recent discussions have suggested that the company could be valued between $40 billion and $60 billion if sold to a corporate buyer. Such a high acquisition price means that only a limited number of companies would have the financial resources to make a purchase, making the situation even more complex.
The Complexity of Selling a Major Business
As highlighted by various sources, selling a business of Bloomberg's size is much more complicated than simpler cases, like former President Jimmy Carter selling his peanut farm. Most potential buyers would need to consider the financial implications of acquiring a company that generates significant revenue. Experts suggest that a "consortium leveraged buyout deal," where a private equity firm acquires a majority stake, might be the most feasible option for Bloomberg.
However, a source close to Bloomberg indicates that he only plans to sell his company if he wins the presidency, not during the campaign. This indicates a strategic approach, where he prioritizes his political aspirations while navigating the complexities of his business holdings.
How Bloomberg Built His Financial Empire
Understanding how Bloomberg amassed such wealth requires looking back at his early career. After being let go from Salomon Brothers in 1981, he received a severance package of $10 million, which is equivalent to about $30 million today. He used this substantial payout to launch his financial data company, initially named Innovative Market Systems. This venture proved to be incredibly successful, largely due to the introduction of the "Bloomberg Terminal," a subscription-based service that provides financial data and analytics.
The Bloomberg Terminal remains a staple for financial investors and institutions globally, costing approximately $24,000 per year for a single lease. With over 325,000 subscribers worldwide, the revenue generated from subscriptions alone amounts to an impressive $6.5 billion annually. This success significantly contributed to Bloomberg's net worth, which is estimated at around $62 billion in 2020.
Transparency in Financial Disclosures
Mike Bloomberg has also committed to transparency regarding his finances. He has promised to release his tax returns, which could offer valuable insights into the financial dealings of one of the world's richest individuals. This move may help to alleviate concerns about potential conflicts of interest should he ascend to the presidency.
By examining Bloomberg's business strategy and the challenges he faces, we gain a deeper understanding of the intricate relationship between business interests and political aspirations. The decisions he makes regarding his company will not only impact his personal wealth but also the trust and confidence of the American public in his ability to govern impartially.
