Life After CBS Hasn't Been Too Kind to This Executive.

Seems that life is turning into hard cheese for one of our all-time heroes here at Curmudgeonly Arms: Michael (Hot Air) Jordan (not the basketball one, the other one).

First he gets aced out of his job at CBS Corp., the broadcaster, by another Curmudgeonly Arms grandee: Mel (Mad Mel) Karmazin. Then he skulks off to Texas and takes over some New Economy dot-com, Luminant Worldwide Corp., whose stock promptly goes from $52 to $1.81 a share under his watch. And now he's turning up in the press joking that life just ain't worth living when you can't fly around in a private Gulfstream anymore. Don't you hate it when that happens?

We'll get into the particulars of what E-Jordan's latest excellent adventure is all about in a minute. But first an update on how things have been going at CBS ever since Mad Mel showed him out.

In the world as it is understood on Wall Street, CBS in fact no longer exists, having been taken over just about six months ago by Sumner Redstone, who one way or another owns and controls Viacom Inc., the media conglomerate.

Well, to begin at the beginning, what happened was this:

Ever since God decided to let there be light, William Paley had run CBS. Then, in the ripeness of his passing years, Paley sold out to Laurence Tisch, who himself grew ripe and sold out to Jordan.

Hot Air -- a classic piece of business-world performance art if there ever was one -- had himself begun adult life in the potato-chip business. Thereafter, he shucked-and-jived his way up the Wall Street food chain until, by the mid-1990s, he found himself presiding over the collapse of Westinghouse Electric Corp. It was at that point that he sniffed out Tisch's apparent interest in dumping CBS, and thereupon devised a scheme to merge Westinghouse and CBS, and then dump the Westinghouse business onto anyone who would take it, thereby reconstituting himself as the head of a media empire instead of a refrigerator and steam-turbine business.

This all would have worked out great for Hot Air except that, in the summer of 1996, Our Boy decided to make a bid for Infinity Broadcasting and thereby wound up with the chief of Infinity, Mad Mel, in his life as CBS's biggest single shareholder.

Football deal

In the two years that followed, Mad Mel just bided his time in the slow lane, waiting for Hot Air to make the wrong turn that would send him into the guardrail. And Mel didn't have long to wait since, by the start of 1998, Hot Air was swerving all over the road, with network advertising slipping as cable TV and the Internet began taking big bites out of broadcast TV's audience.

Then, in January 1998, in an effort to bring back viewers, he inked a deal for CBS to pay an astounding $4 billion to acquire the broadcast rights to NFL football for the next eight years -- a deal that sent him careening right through the median divider as Wall Street took one look at the numbers and concluded that CBS would never make a dime from the contract.

By October 1998, CBS's stock price had fallen to a low of $18 a share, from a high of almost $37 six months earlier, and Mad Mel, as the company's largest shareholder, had all the ammunition he needed to orchestrate what looks to have been the boardroom putsch that handed Hot Air his hat while handing Mel himself the job as CBS's chief executive.

Not long afterward, Mel sold CBS to Sumner Redstone and the Tiffany Network simply disappeared into the Byzantine financials of Viacom. Meanwhile, Viacom itself has seen its stock fall by 24 percent since its high of $74.63 a share on Aug. 4 and as of last week was selling at $56.50.

As for Hot Air, well, he took a $6 million "don't let the door hit you on your way out" payment, along with some 2.8 million shares of CBS he already held (value at the time: $100 million, give or take), and went quietly into the night -- only to resurface in Texas, where we find him now heading up, of all things, a dotcom operation.

Two truths

The company went public in September 1999 at $18 a share, claiming in its offering prospectus that it possessed "more than 100 clients diversified across many industries." That's interesting because, in its latest quarterly filing, the company states that "prior to September 1999," Luminant "did not conduct any material operations." I am sure I do not know how both those sentences can be true, but certainly they must be or else they would not be issuing forth from the e-desk of Hot Air. (Would they?)

In fact, of the roughly $84 million in net proceeds raised in the initial public offering, some $60 million was already earmarked so that Hot Air could pay for eight Internet companies that were waiting to be bought out. As a result of these acquisitions, Luminant as of June 30 shows balance sheet cash of only $8.9 million left from the IPO, with a stupefying $281 million of essentially worthless goodwill in its place as the company's only significant asset.

The balance sheet itself is amazing. Though the company claims 950 employees, with offices in New York, Dallas and a number of other cities, the June 30 balance sheet shows total property and equipment of less than $14 million, which would seem to suggest that at least a few of those 950 employees may either be home office shut-ins or come to the office and have to work standing up (note to the reader: this is an e-joke) -- especially when you consider that close to $10 million of that property and equipment consists of capital expenditures to fancify the company's showcase offices in Dallas and New York. Take the goodwill out of the picture, and on a balance sheet basis, the entire company looks to be worth not much more than its desks, chairs and computers.

The revenue picture is not a whole lot better. In the three months ended June 30, Luminant reported $40.1 million of revenue. Once you take out operating costs, the company showed net quarterly operating income of $1.88 million. But that's before charging off more than $31 million in goodwill.

Cash available

Last month, the company announced that it had raised $17 million in a convertible debt deal, but simple arithmetic says it really has spendable cash of no more than about $15 million, and a lot of that could disappear quickly if they have to start paying their employees with more cash instead of partly with stock. Luminant shares have traded as high as $52 (last November) and closed on Oct. 31 at $1.81. Tough noogies for Hot Air - the value of his own stake in the business has plunged right along with the stock price, falling from $6.8 million to $229,000 now.

Meanwhile, the world is now left with the spectacle of Hot Air -- recently described as an "Old Economy turnaround pro" -- sounding off at forums such as a recent Internet conference in New York, on what the old pros and those young, pony-tailed whippersnappers have to learn from each other. Don't you hate it when that e-happens?

It was, by the way, on this occasion that Hot Air unloaded to a New York Times reporter on the injustice of not having a corporate jet to fly around in anymore. Oh my. Mark my words: Before long, he'll be turning up as the e-savior of Xerox Corp.