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Los Angeles Magazine
April 2000


The Last Tycoon

Like a figure out of fiction, Arnon Milchan is the kind of character Hollywood loves to invent. He has produced nearly fifty films, including L.A. CONFIDENTIAL and PRETTY WOMAN now he's in business Rupert Murdoch. Yet he remains the town's most secretive mogul. Could it be the Israeli arms deals?

"ARNON. MMM,"MURMURS A VETERAN MOVIE PRODUCER. "You know how he made his fortune, don't you?" It is the invariable, hushed preamble to the subject of Arnon Milchan. Confidential stories quickly follow--sketching a man of irascible charm and a shrouded, mysterious past, bearing more in common with Jay Gatsby or even James Bond than, say, Jack Warner or Mike Ovitz.

Twenty years ago, Milchan, an unknown Israeli tycoon, pitched his hat into the Hollywood ring. Today he runs his own mini studio within a studio on Rupert Murdoch's 20th Century Fox lot. It is the reward for being one of the town's most prolific producers of successful quality movies, more than 60 in all, including Fight Club, L.A. Confidential, Entrapment, Pretty Woman, JFK, The King of Comedy, Brazil, Natural Born Killers, Heat, The Mambo Kings and The War of the Roses. Now, having conquered movies, Milchan has set his sights on the even more lucrative small screen. His first sitcom, Malcolm in the Middle, became an almost instant hit and the phenomenon of the TV season. Premiering in January to some of the best ratings and reviews in Fox's 13-year history, the show was the most watched comedy in the country in only its second week on the air.

 

Milchan is currently plotting a TV pilot of L.A. Confidential and a program by the creators of The Blair Witch Project and, of course, more movies.Although kingpins like Warner Bros.' Gerald Levin and Disney's Michael Eisner are quick to return his calls, and celebrities like Tom Cruise, Barbara Streisand, Robert De Niro and Al Pacino count him as a friend, Milchan rarely turns up in print, and not by accident. He is an authentic Hollywood anomaly. "My idea of a good profile is no profile," he tells me over the telephone. In a town where disclosure and revelation are as banal as cereal, Arnon Milchan has kept his secrets to himself.


In 1996, Milchan briefly popped onto the media radar screen when he nearly seized control

f MGM with his partner, Australian media baron Kerry Packer. But only Kirk Kerkorian was willing to pay $1.3 billion for the studio that he had already bought and gutted twice before. "Sometimes losing is winning," Milchan told me smoothly at the time.


Determined to build his own media giant, Milchan promptly moved on to other ventures and bought a 32 percent stake in the German sneaker giant Puma for $150 million ("We have total control over the company," boasts Milchan). He also gobbled up Restless Records to produce film scores and carved a distribution deal with BMG music. Then in 1997, ending a six-year relationship with Warner Bros., he embarked on perhaps his boldest move yet, a partnership with Murdoch, selling him 20 percent of his film company, New Regency Productions, for $200 million. Murdoch also invested another $30 million in Regency Television. Milchan's tony offices occupy most of Building 12, right next door to the Executive Building on the Fox lot. And it is from this seat of power that Milchan is building an entertainment empire that could one day rival Murdoch's.

FOLLOWING WEEKS OF A TRANSCONTINENTAL PHONE CHASE, MILCHAN RELUCTANTLY AGREES TO MEET WITH ME ONLY TO "CONSIDER" THE POSSIILITY OF AN INTERVIEW. A young-looking, exceedingly fit 55-year-old man, Milchan appears at the bar of the Hotel Bel-Air wearing khakis, a T-shirt and an elegant, single-breasted blue blazer. Notwithstanding encroaching baldness and rimless eyeglasses, Milchan has the boyish jaunt and ease of a tennis player. In fact, he is a formidable tennis player, hitting, the courts for at least three, sometimes six hours a day.Milchan is quick to make clear his reservations about doing an interview. "I know how you reporters work," he says, his voice tinged with the distinctive guttural tones of an Israeli. "You sit down at your computer and you hit NEXIS and then," a flourish of his hand and some eye-rolling, "it's the same old stuff all over again." His eyes meet mine, his meaning clear. "You mean, the arms dealing?" I venture cautiously.

 

But before I finish, Milchan is waving his hands dismissively. "See what I mean?" he says plaintively. I fear that this may be the end of our brief meeting. After a weighty silence, I tell him that I assume he sees himself as a "patriot." He brightens considerably. "Absolutely. Of course I am," he says, leaning across the table. "But all that is old business---something I

did a long time ago." Well, not exactly, but a topic to pursue later.

It is agreed we will talk in Montfort l'Amaury, a bucolic region about an hour outside of Paris, where Milchan owns a restored 18th-century home, formerly a hunting lodge, on a 50-acre farm. It is replete with pond, chickens, ducks, three horses, five ponies and two donkeys. The estate, which Milchan bought 18 years ago, sprawls onto the Bois de Rambouillet, a lush forest preserved by the French government next to the country home (and far less grand property) of French president Jacques Chirac. Milchan has kept the residence simple, preferring traditional furnishings and representational paintings. The grounds include a clay tennis court, enclosed pool, spa, gym and guest house, where photos of him with his celebrity friends adorn the walls. For his L.A. spread, Milchan has recently purchased and is renovating a home in Malibu in an area that could be called Mogul Beach, with neighbors like David Geffen, Terry Semel and Jeffrey Katzenberg. Then there are houses in Tel Aviv and Monaco--where Milchan enjoys tax-free citizenship.

But we first meet at the Hotel Trianon in Versailles, halfway between Paris and Montfort l'Amaury. Milchan announces that he has a precondition for the interview. I'm fairly sure it's going to center on arms dealing, but to my surprise and relief, Milchan has an even more sensitive subject. Before I go to his home, I have to agree not to write about whom he lives with and where. Milchan explains with discomforting sincerity that he doesn't want "to hurt anyone's feelings," though it is transparently dear that self-interest is, at least, equally important. Director Terry Gilliam, who made Brazil and The Adventures of Baron Munchausen with him, says he's got "a tall Scandinavian blonde in every port." When I mention Gilliam's quip, Milchan laughs. "Okay, you can say that," he hedges. "Just nothing specific." Steve Reuther, Milchan's former business partner, offers his own assessment of Milchan's lifestyle. "I've seen better," he says, his voice tinged with the jaundice of show business, "and I've seen worse."

Born in Tel Aviv, Milchan describes himself as a "10th-generation Palestinian." Indeed, he was born into Israeli aristocracy. "My family's been there for 500 years. My grandfather was a very close friend of President Weizman." Milchan's father was an enviable success story himself, having laid the sprinklers that irrigated Israel. Later, he would handle some of Israel's lucrative military contracts, according to his son. However, it was young Milchan who put the company on the map internationally, after his father's sudden death. Following a spot of schooling in London and Geneva, where he excelled in soccer and tennis, Milchan dropped out and returned to Israel. Soon, he struck gold. By marketing a newly discovered nutrient that quadrupled citrus production, he brought his company stratospheric sales throughout the world.

 

"This is a man who made his fortune by screwing with nature," says screenwriter Shawn Slovo, who began her career as Milchan's secretary in 1977. "He's the Israeli who made the desert bloom. Amazing when you think about it. He could have retired at the age of 22."Instead, like a kid racing around the Monopoly board, Milchan gobbled up another half dozen businesses--including electronics, chemicals, aerospace and plastics. Still in his early twenties, he met the Shah of Iran and reportedly talked the wily Persian into dozens of contracts, one to build much of Tehran's airport. By then, he had met a sultry French model named Brigitte Genmaire in the lobby of a Tel Aviv hotel. "She converted to Judaism when she was nine months' pregnant," says Milchan. "It was funny, because part of her vows was declaring to the rabbi that she was a virgin." Milchan says his young wife had no problem moving to Israel and raising three children there. "The problems began when she learned Hebrew and I really learned French," he says with his well-practiced impish grin. "When we could finally communicate with each other, then there were problems." The marriage ended in divorce.

Milchan says that 30 years ago he frequented a Tel Aviv restaurant where the best and brightest Israelis hung out. "There was this brilliant guy who wanted to start a new political party," he recalls. The young man's name was Shimon Peres, and he eventually did launch his own party, along with a handsome Israeli war hero named Moshe Dayan, a young Teddy Kolleck, Chaim Herzog and Milchan himself. Milchan's partners nominated him to be finance minister, and he briefly flirted with a political career before deciding against a life in the public eye. Nevertheless, Milchan's political connections would prove to be the foundation of his future empire. In addition to agriculture, there would be biotechnology, advertising, aerospace and the biggest jackpot of them all--arms.

 

"MMM. YOU KNOW HE'S AN ARMS DEALER, DON'T YOU?" THE PRODUCER CONTINUES. Details are not provided, only a whispered confidence charged with admonition and awe. And notwithstanding Milchan's denials, dismissals and wafflings, arms dealing has surely contributed to his fortune. (He claims that his parent company, Regency Enterprises, is valued at more than $1 billion.) As the Los Angeles Times put it, "Milchan has also worked in arms consulting."

 

Throughout the 1970s, '80s and even up until the Gulf War in 1991, Milchan was Israel's foremost weapons procurer, brokering deals for such prized superweapons as the Hawk missile and the famous Scud-foil of the Gulf War, the Patriot--"everything from nuclear triggers to rocket fuel to guidance systems," according to NBC News. At different times in his career, his Israeli company, Milchan Brothers, has represented arms manufacturers such as Raytheon, North American Rockwell, Beechcraft, Bell Helicopter and Magnavox. Or, as Milchan downplays it, "there were a bunch of them." Nevertheless, he bristles at being called an arms dealer. "I'm their rep in Israel," he says emphatically. "I get a fee, a commission. I'm not even the buyer. I'm an agent. Never, ever, ever," he says, growing visibly irritated, did he sell to countries other than Israel. "I want to make that point, because I know some people would label me an arms dealer.

"What we do is send my people to the United States," Milchan explains, curiously in the present tense, "so we know what these guys are talking about, and you go back and say to the buyer, `I think this guy has some interesting stuff. Would you meet with him?' And then you arrange a meeting with the head of the [Israeli] air force and the head of this and the head of that." Representing Israel, a country that practices war games during the lulls when it is not waging war, is about as plum as it gets in the arms bazaar. "Israel was the only place where America could use their systems in battle without having to send soldiers," he explains. "That's why Israel is so strategically important for the aerospace industry."


Gilliam says he'll never forget a visit to the Paris Air Show with Milchan during the filming of Baron Munchausen. "It was wonderful to see how the whole arms business worked," says Gilliam. "Amon was very psyched about the video games. He brought his son with him, who was then a teenager, to play the games, which can replicate the destruction of the planet. He took me to the Raytheon booth, and it was all showmanship. He was obviously a big star to Raytheon."Milchan's relationship with Raytheon has been a long and, at times, bumpy one. His first flap with controversy came in 1975, over an "improper $300,000 commission paid to his company by a Raytheon subsidiary for the sale of Hawk missiles," according to Robert Windrem, co-author of "Critical Mass: The Dangerous Race for Superweapons in a Fragmenting World." The case made headlines, but Milchan was eventually cleared of any wrongdoing.

 

Considerably more trouble and bad press resulted from one of Milchan's ventures in South Africa in the mid-'70s, erupting in a national scandal dubbed Muldergate.
With both Israel and South Africa increasingly isolated at the time, the two countries had embarked on a series of joint ventures running the gamut from public relations to the acquirement of nuclear technology. "Yes, there was a coordinated effort to explain apartheid in a way that it was not such a bad thing," says Milchan, who claims he was innocently and naively brought into a project whose goal was to buy media sources around the world in order to promote a better image of South Africa. According to Andrew and Leslie Cockburn, authors of "Dangerous Liaison," "the Rabin government recruited ... Milchan to launder cash ... to purchase influential publications." Milchan puts it another way, saying he was asked by prominent Israelis if "we can use your companies to make deals to buy newspapers. I said, `Sure. It sounds like fun.' Basically, I was used as a middleman." Later, Milchan says, when he realized the true nature of apartheid, he pulled the plug on the deal.


Milchan's closest call with catastrophe came in 1985, when a business associate, Richard Kelly Smyth, was indicted by a federal grand jury in Los Angeles on charges of smuggling 810 krytons (electronic timing devices that can be used to trigger nuclear explosions) to Israel. Smyth first met him in the early 1970s when he was working for Rockwell. In 1973, Smyth started his own company called Milco, financed, according to the Washington Post, by Milchan, hence its name. Up to 80 percent of Milco's business was reportedly with Milchan and Israel. Milchan claims he has never had any financial interest in Milco. Although selling arms to Israel is legal, any weapon or resource with a nuclear capability requires either a munitions license or an end-user certificate, both of which would be denied by the State Department because Israel has refused to sign the Nuclear Nonproliferation Treaty. However, in 1980, the federal indictment asserted, Smyth and Milco sent 610 krytons to Israel without the necessary licenses, plus another 200 in 1982.

In August 1985, U.S. Customs subpoenaed the financial records linking Smyth and Milchan. The records were neither turned over nor found. Smyth and his wife disappeared just days before his scheduled trial, which almost certainly would have involved Milchan. "I don't know what the hell they were talking about," he told Windrem about the Smyth case. Milchan's lawyer also claimed he had proof that his client's company had instructed Smyth to apply for the proper licenses. Milchan refuses to divulge details but offers a cryptic aside. "Let's assume that there's nothing that Israel and the United States do separately," he says with a trace of amusement. Smyth, a U.S. fugitive for more than a decade, was last seen in Herzliya Pituach, an affluent suburb of Tel Aviv, where Milchan owns a home.


Milchan says he dropped out of weapons sales, which he calls "aerospace," in 1991, post-Gulf War, after "selling the Patriot missiles to Israel to defend against the Scuds." He quit for various reasons, not the least being that he was tired of being stigmatized by what he calls "cheap shots." Some question whether he is really out of the business. Even Milchan is somewhat ambiguous: "I'll say it in my own words. I love Israel, and any way I can help Israel, I will. I'll do it again and again. If you say I'm an arms dealer, that's your problem. In Israel, there is practically no business that does not have something to do with defense."

 

PEOPLE COME TO HOLLYWOOD to be born again. The promised land of indulgence and amnesia, Hollywood cares little about people's pasts. Indeed, Milchan's weapons dealing has, if anything, augmented the aura and mystique of his outsider, bad-boy profile. Moreover, anything done for the benefit of Israel is given a wide berth. "I remember a front-page story in London about Amon and nuclear triggers," recalls one of Hollywood's most prominent producers. "Hollywood doesn't give a shit about it. They think it's glamorous. It's like Begelman. Anything goes, as long as your pictures make money."

But given his combative nature, Milchan has had his share of skirmishes. "Arnon was a pirate, a buccaneer in Hollywood," says Gilliam. "He ran into Hollywood's anti-Semitism. They don't like real Jews. They don't like Israelis. Arnon has a Levantine soul. Everything is horse trading and carpet dealing." A top Hollywood executive once warned Oliver Stone to stay clear of Milchan. "He told me that Arnon was a Middle Eastern rug dealer. Beware," recalls Stone, embittered from business dealings gone sour. "I should have listened to him. He was right."In one bruising battle during the making of Brazil, then-MCA president Sidney Sheinberg shot off a memo to Milchan: "In Texas, we have a saying, `Put your money where your mouth is.' I'm sure there's a Hebrew equivalent." Milchan, who later battled Sheinberg over the release of the film, was unamused and dismissed the executive as "an assimilated Beverly Hills Jew."

Ultimately, it is Israel and its sense of persecution that colors Milchan's personal and professional life. Former Fox president and now independent producer Larry Gordon remembers getting a call a few years ago from Milchan, who was on his first trip to Tokyo. "At the time, I was partnered with the Japanese, and Arnon called and said, `Larry, I feel really weird here. It's very strange the way they treat me.' I said, `Arnon, you gotta understand, these people don't like Americans, they don't like Jews, and they especially don't like Israelis. That's just the way it is.' There was a long pause, and then Arnon says, `You mean, like Baghdad?'"


Milchan first started producing films in Israel with a movie called Black Joy in the mid-'70s, then forayed into Hollywood by covering the completion bond for the television miniseries Masada in 1981. "I was discovered by a guy called Elliot Kastner," says Milchan. A lover of glamour, glitz and girls, Milchan became hooked on show business after a dinner with Kastner and Elizabeth Taylor. "You kind of buy yourself into it to be humiliated--into becoming the next sucker in the business. So I voluntarily said, `Okay, I just want to be around.' All of a sudden, I'm in business with this guy," says Milchan. "Just staying alive is the name of the game. So I hung on."


A former employee says that Milchan used his invincible charm to convince Cannes officials that Black Joy was a worthy entry into the festival. After a few films and a falling-out with Kastner, Milchan set out on his own, setting up Regency Productions and establishing a reputation for making prestige pictures with respected directors such as Sydney Pollack, Sidney Lumet, Ridley Scott, Ron Shelton and Martin Scorsese (The King of Comedy is Milchan's favorite of the movies he's produced). Adding to his outsider mystique, the multilingual Milchan continued to live and work most of the time away from Hollywood, shuttling between his various homes--the consummate jet-setter.


"He's one of those rare people who can do the detail work and also stay focused on the big picture," says former partner Steve Reuther. "I knew he had a dozen other businesses, but here he only talked about the movie business." A current associate describes him as "both a dealmaker and a filmmaker who's pretty hands-on when he's in town." Robert De Niro, who has made five films with Milchan (Brazil, Guilty by Suspicion, Heat, The King of Comedy and Once Upon a Time in America), says that "compared to some of the people out there who have nothing on them but an Armani suit, Arnon is the real thing. He's paid his dues, he's got good taste, works very hard, and he's totally committed. He spins circles around those other guys."


Milchan runs his company like a family business. Heading up New Regency Productions for him is his childhood friend David Matalon, whose parents were best friends with Milchan's. Daughter Alexandra is vice president of production in Los Angeles; son Yariv, a photographer, shoots movie stills, while daughter Elinor is an independent producer, presently making a documentary on Cuban artists. All three children speak reverentially of their father, who raised them from their teen years. French is the family language, Israel the family identity, says Elinor. "When we were kids, we wanted more time with him," says Alexandra, "but now I realize it's quality, not quantity, of time. Growing up, I would read that he was an arms dealer; he was in the MOSSAD, and he was a movie producer. But what I like is that he is really close to the ground, very real and simple. Until recently, we traveled coach. He wanted us to know the real world. The worst thing that could happen to me is to lose his trust and respect. My family is not a family--it's a clan."


In Israel, Milchan spends much of his time with best friend Shimon Peres, the former prime minister who recommended two books to him, The Name of the Rose and The Remains of the Day. (Name of the Rose was developed by Milchan and eventually made into a movie by others.) His relationship with Peres almost led to another unlikely collaboration. "I was over at his house during Passover in 1995," recalls Milchan. Anyway, we're getting drunk, having a good time, and all of a sudden he's looking at his watch. He said, `Oh. It's 11:30. I have a meeting with the Palestinians.'" Moments later, "security men and the [Palestinian] delegation come in, including Nabil Shaat, an Arafat lieutenant. And it's `Shimon promised me this and that.' I'm absolutely impressed with how smart they are, how in good faith and trusting they are. Seriously. I here was more good faith there than there is in Hollywood. And I'm sitting there and nobody has noticed me, and Shimon says, `This is Arnon, he's a good friend. He makes movies.' And somebody says, `Really? What movies?' `Oh, he made Pretty Woman.' And they say, `That's Arafat's favorite movie. He saw it 20 times. Oh, you did The Client? Oh, my God.' At the end, they are designing a movie about a Palestinian and a Jew."


Recently, Milchan has become close to Israeli prime minister Ehud Barak and is anxiously watching the Israel-Syria peace talks. "I think Barak will get a good deal. It has got to be done. Look, we can always go back to war if it doesn't work out," he cracks, but adds, "give peace a chance."


Former colleagues say Milchan shifts from kindly patriarch to vengeful demagogue, veering between outrageous generosity and inexplicable miserliness. "On Brazil we had a great relationship," says Gilliam, "on Munchausen, he was dreadful." The nub of their falling-out was a $150,000 development fee that Fox had paid out for the rights to the screenplay. According to Gilliam and others on the production, Milchan simply pocketed the money, pushing the overbudget, disaster-plagued shoot into more red ink. Milchan says that the money was reimbursement for his own out-of-pocket expenses on the film.

When Gilliam decided to take his beleaguered film elsewhere, Fox demanded its development fee back--the first Gilliam had heard about it. Later, when he and Milchan split, Milchan insisted on another $75,000 payment plus profit points before signing off from their deal. "Arnon has to screw everyone--partners, friends--literally, figuratively, in every sense of the word," says Gilliam with a raucous laugh. "It's pathological. He can't stop himself. At some point, he needs to invent an enemy." Another filmmaker says wearily, "Sooner or later, you'll be on the outside with Arnon. This is a man who has to win. He doesn't believe that both parties can win."

On one occasion, according to producer Gordon, Milchan was playing tennis with his best friend, Meier Tepper, at the Hotel du Cap on the French Riviera. "Meier is a really sweet, nice guy, and Arnon almost always beats him. But this one time, Meier was up five-love. Arnon threw a fit--screaming that his friend was cheating him and carrying on like it was some blood feud, until he just psyched Meier out and won. To my mind, he's as competitive as Eisner and Murdoch."

Roman Polanski has enjoyed a 20-year friendship with Milchan. "Dinners, parties, nightclubs," says Polanski from his home in Paris. "He's fun." In 1981, Milchan produced the French version of the stage play Amadeus, which Polanski directed and starred in as Mozart. "It was a big success and could have gone on for years, but I couldn't do it anymore," says Polanski, who adds that Milchan has also helped him with advice about distribution of his films. However, they have yet to make a movie together. "Of course, I've heard what people say: `Better to be friends with him than do business.' I know he's a tough businessman. Tough is fine, ruthless, no--but I haven't seen that."


ALONGSIDE THE POND at Milchan's home in France is a life-size sculpture of a man sitting at a table, facing a plateful of money. It's called The Last Meal of a Greedy Man. Milchan tells me it was a gift to him from director Sergio Leone, but he's quick to add that Leone was not sending him a message. Stone, who made JFK and Natural Born Killers with Milchan, thinks otherwise. "He's as cheap as they come," says a furious Stone. "He's sick about money, obsessed with losing it. I learned a very hard lesson, and it cost me a lot of my personal money. I don't want to get into a pissing contest, but Arnon can be very nasty." Even former partners in Hollywood--where the dictum is "no memory, no enemies"--say that a tangle with Milchan can be costly. Concurs one, "He approaches everything like tennis, and it's unbearable for him to lose--even a point."


Natalie Zimmerman, an interior designer who was married to Reuther, recalls a dinner at Cannes some years ago where the topic was two competing Christopher Columbus projects, one to be made by Ridley Scott, the other by the Salkind family. "Arnon said, `I bet neither one gets off the ground,'" remembers Zimmerman, who replied that she thought otherwise. "I said, `I bet they both get made.' Arnon gave me one of his looks and says sarcastically, `Look who's talking. The interior designer!' See, he likes to humiliate people. Then he says, `I'll bet you any watch in the world that neither movie will get made.'" Zimmerman won the bet but had to badger Milchan before he finally sent her a Rolex, "a cheap one," she adds.


Nevertheless, Milchan continues to attract high-class talent and partners. Like Fitzgerald's Gatsby, Milchan possesses "a heightened sensitivity to the promise of life," which draws the best and brightest toward him. However studied and contrived his casualness, self-deprecating charm and perpetual enthusiasm may be, it's an irresistible package to many. "He consistently picks winners. Most of his movies do very well," admits one of his critics. "The showmanship is the side I like, except when it's self-serving," says Gilliam. "That's the sad part." Previous to Munchausen, Gilliam was taken with Milchan's ostensible generosity and grandiosity. "His great skill was pretending that he's very rich. He'd rent two cabanas--not one--at the Beverly Hills Hotel to out-impress the other big shots," says Gilliam. "It was his belief that Hollywood throws money at money. But he never spends his own money." "Personally, I don't know anyone who has ever made money with Arnon," says a major Hollywood producer. "It will be real interesting to see what happens with Rupert Murdoch. Real interesting."

Milchan clearly relishes his relationship with Murdoch and, judging by his own recent global moves, certainly sees him as a role model. "I consider him one of my best friends, and I think vice versa. We're having a ball. He's a very cool guy." On Murdoch's recent remarriage to 32-year-old Wendi Deng, Milchan says, "He's like a kid now. They giggle and enjoy each other. Rupert's a gentleman, and I know you'll laugh at this, but he's a gentle person."Milchan offers a description of Murdoch that could almost describe himself. "He reminds me of the Michael Douglas character in Falling Down, who says, `I just want to go home, and if no one gets in my way, nobody's gonna get hurt.'"



IN MID-JANUARY, Milchan is in an ebullient mood. He has survived the worst storm of the century in Europe, holed up in his mansion in the French countryside for nine days without electricity, water, heat or telephone. "It was crazy. Here I was, a Jew in a storm. I slept 18 hours a day. It was great. Every time I woke up, I took a sleeping pill."
Milchan is not cheerful simply because he has caught up on his sleep. He has just received the ratings numbers for his new sitcom, Malcolm in the Middle. "We're going to save the Fox network," he says gleefully. But television and movies are only part of the big picture for Milchan. He promises that another substantial acquisition is in the offing but with typical secretiveness declines to disclose any specifics. In the meantime, he has masterminded a merchandising deal between his sneaker company, Puma, and 13 pro football teams, including the St. Louis Rams and the Tennessee Titans. Much to Milchan's delight, the Super Bowl rivals performed in front of an estimated TV audience of 130 million sporting Puma patches on their jerseys.


"It's the synergy between films, music and sports," Milchan tells me. "That's where the future lies." And his model is Murdoch's News Corp., which in addition to its Fox Sports Network also owns the Dodgers. Rather than spend 20 years building a sports company, Milchan saw Puma as a shortcut into the sports world, using his movies and Murdoch's TV programming to promote the brand name.And, of course, athletes have to be doing something while they wear his shoes, so Milchan spent $120 million to acquire nine-year television rights for the Women's Tennis Association Tour. This was potentially an even better fit with Murdoch's worldwide television interests. For Milchan, the tennis deal had all the ingredients of a movie--stunning women, glamour, exotic locations. At the time of the deal in 1998, he suggested using movie costume designers to outfit his female players. And to prove that tennis had the requisite sizzle, he showed up at the French Open with supermodel Naomi Campbell and at Wimbledon with Kevin Spacey.


Milchan's deal with Fox also assures him a level of financial security. With Murdoch's $200 million investment and a subsequent $600 million line of credit from a team of banks led by Chase Manhattan, Milchan is well into mogul territory. Although New Regency has been in more of a start-up phase than a production mode at Fox and has yet to have a hit, he expects the company to eventually finance about nine pictures a year. Squelch, directed by film noir master John Dahl, will be released this summer; Joel Schumacher's Tigerland and Big Momma's House, starring Martin Lawrence, are in production.

With a 15-year distribution arrangement at Fox, Milchan is unlikely to make any moves to acquire another studio, as he did with MGM. "If you buy a studio, you're going to be under intense scrutiny," says one former studio head. "And Arnon's got most of his assets tied up in foreign entities. They would take a close look at all that. Also, running a studio means collective decisions with a board and all that, and I don't see Arnon as being one who likes to consult with a lot of people. I think he's better off doing what he's doing.""Arnon gets to do what we all dream about, but you can't if you're running a studio," says former Warner Bros. cochairman Terry Semel. "You can't run Warners or MGM from France. He is a superb producer--brilliant at putting people and things together--but he'd have to trade it all if he became a corporate officer."


And for all of his wheeling and dealing, Milchan is not a corporate creature. He continues to spend only a few days a month in L.A.; the rest of the time, he is flying between Paris, Monte Carlo and Tel Aviv, often visiting stars on the sets of his movies. He loves reading scripts and jet-setting with the talent. Although he's not always involved in the day-to-day operation of his company, he still retains the final say on all New Regency product.
In 1994, for his 50th birthday, his longtime paramour produced a video tribute based on his need to conquer and please, titled Natural Born Seducer. Hollywood stories, probably apocryphal, suggest he built a tennis court for one Industry executive and bought a house in the south of France for another. "Arnon has three great assets," Sergio Leone was fond of telling people. "Charm, charm and charm." I get a chance to see this firsthand. Days after I mention my interest in Mideast politics, particularly in Morocco, Milchan calls to invite me to a birthday party for Moroccan King Hassan II's son, who has since ascended to the throne. "Now I'm working for you," he jokes.


The next day, he has chartered a jet for the flight. "I'm nervous," he says. "This will be my first time to an Arab country. You know I have an Israeli passport." We are met at the airport in Rabat by one of the court's ladies-in-waiting. Before the party, Milchan and his son run off to the beach for a swim. Still in his shorts and T-shirt, Milchan drops in at the home of the king's chief adviser, Andre Azoulay, a Moroccan Jew who had previously been a political prisoner. In the space of two hours, Milchan announces his intention to invest in Moroccan agriculture and in starting a new media company. Azoulay is so impressed that he calls and notifies the king midway through the meeting.

Later that night, at the prince's party, an event as lavish and surreal as any Fellini movie, Milchan mingles easily with the polylingual glitterati, imported Eurotrash and powers that be. After leaving Morocco on a hired jet, he lands at Charles de Gaulle Airport in Paris, helicopters to his home in Montfort l'Amaury, sleeps two hours, helicopters back to the airport, jumps on the Concorde to JFK and then another helicopter to a waiting boat in East Hampton for a weekend cruise with his children, then heads off to L.A. for the premiere of one of his films. "Arnon is too smart to waste life on pessimism," says his old friend Shimon Peres. "But he is more than an opportunist; he's an opportunity creator."

Indeed. A few years back, during Benjamin Netanyahu's hectic first visit to the States as Israel's prime minister, Milchan somehow wangled a dinner date with him. Never mind that Netanyahu had ousted Peres, whom Milchan had spent election night consoling. Not one to let stones gather moss, Milchan was eager to offer congratulations. Charmed, the new prime minister took time out of his frantic schedule to accompany Milchan to a specially arranged screening for the producer's latest film, A Time to Kill. Even for a social magician like Milchan, the evening paid a handsome dual dividend--cementing a relationship with Israel's new leader while garnering a fresh dollop of buzz for his film. "No one but Arnon could get Netanyahu to go to his movie. No one. That's his genius," says Gordon. Even Gilliam agrees. "Arnon could be king of the world--if he only stopped doing petty, stupid things."

ANN LOUISE BARDACH
In her long journalism career, Ann Louise Bardach has interviewed world leaders from Pakistan's Benazir Bhutto to Cuba's Fidel Castro. Bardach stays on the world stage this month with her story on enigmatic producer Arnon Milchan ("The Last Tycoon" page 74), who already exerted a certain global influence before he came to town. "Most Hollywood people think they're very sophisticated, but in fact, they're not," says Bardach, who writes for Vanity Fair and the New York Times and is the winner of the 1995 PEN West Award for Journalism. "Milchan is truly an international player" Bardach's work has also appeared in The New Yorker and The New Republic.




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bardachreports.com 2002