By Jeffrey Smith, The News On 6
TULSA, OK -- The New York billionaire who once dreamed of owning SemGroup is out of the picture. John Catsimatidis resigned Monday from the committee responsible for the company's reorganization.
When SemGroup filed for bankruptcy protection almost a year ago, they were one of the largest privately-held companies in the country. Now the man many believed was a vision of the future, has quietly stepped aside.
"He wanted to be that white knight in shining armor," said Jake Dollarhide, an investment advisor with Longbow Asset Management.
John Catsimatidis is one of America's wealthiest men.
Last year he learned bankrupt SemGroup owed him a million dollars. The New York billionaire thought he could take over the company and fix it. He had done it before with another oil company twenty years ago.
"We've always done very well in getting companies that are broken and fixing them," John Catsimatidis said during an interview on December 22, 2008.
"All he did was hold a town hall meeting and make a bunch of promises," said Jake Dollarhide.
Seven months ago, Catsimatidis took control of SemGroup's board of directors. Investment advisor Jake Dollarhide said that's when the excitement ended.
"In all the initial proclamation that he was going to save SemGroup, and save the city of Tulsa, there really was just a lack of execution and in my opinion, a lack of action," said Jake Dollarhide.
Catsimatidis clashed with CEO Terry Ronan, who wanted to emerge from bankruptcy as a lean, mean, public entity.
The two went to court and a bankruptcy judge is ruling this week on what happens next.
Catsimatidis has stepped down from the management committee, meaning he has no say in how the company will reorganize.
"They're going to be a much smaller company. They're going to be a shell, a shadow of their former self," said Jake Dollarhide.
SemGroup will need to sell tens of millions in stock to their creditors.
If that happens, we could be seeing the next generation of SemGroup without Catsimatidis in the picture.
If SemGroup gets its way, its creditors will own 95% of the company's equity.
The company will keep its headquarters in Tulsa.
It could take the rest of the week for the bankruptcy court to finalize those details.