Milken Cashes In On Turner Deal Securities Regulators Question Junk-Bond King’s Participation

Despite being banned for life from the securities and investment advisor business, disgraced junk-bond king Michael Milken is making the big bucks again for his deal-making prowess.

Nearly three years after he finished serving time for securities laws violations, Milken stands to reap a reported $50 million from helping advise Ted Turner in his negotiations to sell Turner Broadcasting System Inc. to Time Warner Inc. for $7.5 billion.

Details of Milken’s latest deal-making, reported Friday in The Wall Street Journal, raised the eyebrows of federal securities regulators.

The Securities and Exchange Commission had barred the former Drexel Burnham Lambert bond executive from securities dealings and investment advice as part of his historic settlement with the government in 1990.

His compensation, contingent on completion of the Time Warner-Turner merger, opens the question of whether Milken acted as an investment advisor in violation of his SEC sanctions.

A Milken spokesman, Kam Kuwata, acknowledged a fee would be paid to Milken but would not specify the amount, saying it was still in discussion. He insisted Milken was solely a business consultant to the companies, didn’t negotiate the transaction and wasn’t at meetings attended by other advisers.

“He is a consultant to Turner on the long-range planning needs of Turner Broadcasting,” Kuwata said.

Still, Milken’s role in the Time Warner-Turner deal wasn’t clear. Kuwata declined to say exactly what Milken did. Spokesmen for the companies also would not comment.