Barack Obama may be the most powerful Hawaii native in Washington, and AOL founder Steve Case still can call himself the richest. But the gap between the two successful graduates of Honolulu’s Punahou School seems to be narrowing.
Reports say Case may have poured as much as $500 million of his billion-dollar fortune into Revolution Health, a concept that he once envisioned would compete with WebMD to be a top medical Internet portal.
But now Case has pulled the plug on Revolution Health, sending its remaining assets to Waterfront Media, the company that publishes The South Beach Diet. In the private transaction, the companies did not reveal a sale price, but sources estimate that Case may lose at least half of his personal investment in the venture. Even for a billionaire, that smarts.
Case’s Revolution LLC still holds Revolution Money, an online-payment network; Exclusive Resorts, an upscale timeshare company; and the Zipcar car-rental operation. Zipcar is growing, but the other businesses aren’t doing that well.
Case’s financial concerns do not stop at the Beltway. He is also the major shareholder in Kahului’s publicly traded real-estate and fruit company, Maui Land & Pineapple. Along with Exclusive Resorts, Maui Land & Pineapple has been building a $370-million resort at Kapalua Bay. The construction loans for the project were handled through the now-bankrupt Wall Street investment firm Lehman Brothers.
Case insists he has found new funding for the project and says it’s back on track. But stock in Maui Land & Pineapple lost about half its value after news of the Lehman bankruptcy, costing Case at least another $50 million.
Case, who sits on the Punahou School board of trustees, could plead his case for a “bailout” to the new president, his fellow alumnus. Punahou’s next alumni meeting is scheduled in Washington for January 18, 2009, two days before Obama’s inauguration. Obama is not expected to attend.