Al Gore’s inconvenient media share deal

Just when some political commentators are suggesting that only Al Gore can break the deadlock between Barack Obama and Hillary Clinton - and that he’d be a better candidate anyway to take on John McCain - the former Vice-President is looking to profit from a controversial share deal. In what is being dubbed 'Al Gore's Inconvenient IPO', the global warming guru is planning to float his company Current Media in the hopes of raising $100m, and securing himself about $48m.

Considering that Current Media has lost $31.5m in the last three years, some financial analysts are questioning the integrity of the public offering - a ploy usually associated with private companies that are making healthy profits. In short, Gore is being accused in some quarters of exploiting his fame and prestige - he's the first man to win a Nobel Prize and an Oscar in the same year - in order to make a small fortune.

Current Media operates the tiny cable channel CurrentTV. However, Current won an Emmy last year for providing a forum for 18-to-34-year-old TV viewers, who are encouraged to generate their own content. Its revenues have increased from $23.4m to $53.5m over the last three years, but it still lost $31.5 million.

The public offering was filed on January 28, with some of the money earmarked to repay Gore - executive chairman of Current - and his CEO partner Joel Hyatt the $1m each they loaned the company to get it going. A price per share has not yet been set for the IPO, but Business Week cites one estimate of between $13 and $15 per share, making Gore's 3.7m shares worth more than $48m.

But it's a risky proposition for potential shareholders given that Gore doesn't even have a contract with Current. Were he to leave, the company admits, "our relationships with key distributors and our business could be materially and adversely affected". The company also states that Gore has only a limited amount of time to devote to Current business: he sits on the board of Apple, spends a lot of time on public speaking engagements, and is a senior adviser for Google. Also, he was recently made a partner at Kleiner Perkins Caufield & Byers, a Silicon Valley venture capital firm.

Business commentators are not impressed. Kevin Kelleher of TheStreet.com says the only reason Gore is pursuing the IPO is that CurrentTV has only $2.2m in cash on hand and is $36m in debt. Business Week columnist Ron Grover doesn't like the way the IPO is structured, with Gore and Hyatt receiving an autocratic 10 votes for every vote a common shareholder gets. "That's hardly democratic - with a large 'D' or a small 'd'," a University of Delaware corporate governance expert, Charles Elson, told Grover. "The irony is that this is coming from a Democratic leader."