Marvel's 1996 bankruptcy: Perelman's $553M bond spree nearly killed the comics company

Marvel — the company behind Spider-Man, the X-Men and the comic book boom of the early 1990s — was taken private by Ronald Perelman's MacAndrews & Forbes in 1989 and then loaded with debt. Perelman directed the issuance of over half a billion dollars in bonds through holding companies, which was passed up in dividends to his own group, while Marvel went on an acquisition spree: Fleer, Panini, Malibu Comics, SkyBox and Heroes World Distribution.

The boom broke: the comic and trading-card bubble popped in the mid-1990s, the 1994 baseball strike crushed the Fleer card unit, and Marvel reported its first loss under Perelman in late 1995. On December 27, 1996, Marvel filed for Chapter 11 with $1.3 billion in assets against $1.2 billion in liabilities — its stock had backed $900 million in bonds.

What followed was a war between shareholders and bondholders: Carl Icahn, who had bought Marvel's bonds at 20% of face value, took control of the company in 1997 and replaced Perelman's board. Toy Biz — 46%-owned by Marvel, run by Ike Perlmutter and Avi Arad — bought Marvel from the banks in December 1997, and the merged company emerged from bankruptcy on June 2, 1998. The comic company survived, but the man who owned it had been evicted by the debt he created.