Billionaire Larry Ellison, founder and CEO of Oracle, has signed an agreement to purchase 98 percent of the Hawaiian island of Lanai from fellow billionaire David Murdock, according to documents filed with the Hawaii Public Utilities Commission.
According to the documents, filed Tuesday with the PUC, the sale includes the two resort hotels — the Four Seasons Resorts Lanai at Manele Bay and the Four Seasons Resorts Lanai, Lodge at Koele — two championship golf courses and club houses, The Experience at Koele and The Challenge at Manele and more than 88,000 acres of land.
The price was not disclosed, but previous estimates put the price around $500 million.
The PUC still needs to approve the sale with respect to Lanai’s regulated utilities. Castle & Cooke Inc. and Ellison, in the application to the PUC are asking for interim approval of the indirect sale and transfer of the regulated subsidiaries, such as Lanai Water Co. Inc. and Lanai Transportation Co. Inc., to happen no later than Tuesday.
Maui County mayor Alan Arakawa and Hawaii Gov. Neil Abercrombie told PBN this week that they had met with Murdock’s Castle & Cooke Hawaii Inc. and were told that there was a buyer for the island. The state owns 2 percent of the island, while Maui County owns nearly 200 acres with an assessed value of $7.9 million, and leases about 21 acres from Castle & Cooke.
Murdock took control of Lanai, the sixth-largest island in Hawaii by acreage, in 1985 as a result of his purchase of Castle & Cooke. The state owns 2 percent of the island.
Rumors had been spreading for some time that either Ellison, or Bill Gates of Microsoft-fame, would buy Lanai.
Gates and his wife, Melinda, rented out the entire island, a former pineapple plantation, for their 1994 wedding, while Ellison has a home on Lanai.
Ellison, 67, had a net worth of $36 billion as of March, and was ranked No. 6 on Forbes magazine’s list of the world’s billionaires, and the third richest man in the United States behind No. 1 Gates and No. 2 Warren Buffett of Berkshire Hathaway .
Abercrombie said that it is his understanding that Ellison has had a long-standing interest in Lanai.
“His passion for nature, particularly the ocean is well known specifically in the realm of America’s Cup sailing,” he said in a statement. “He is also a businessman whose record of community involvement in medical research and education causes is equally notable.”
Arakawa said he appreciated Murdock’s compassion for the people of Lanai.
“In terms of the new buyer we can only say that we look forward to meeting Mr. Ellison and hope that by working together with him and the state that we may be able to do good things for Lanai and its people,” Arakawa said in a statement.
Tom Kiely, one of the owners of Hotel Lanai, told PBN that he is thrilled about Ellison owning a majority of the island.
“He has a reputation for building a great business and being a sportsman and philanthropist, this bodes well for Lanai,” he said. “My fear was that the island would be divided up in 50 or so parcels by different developers, but now I’m just really relieved about this.”
Kiely also was quick to note that he has the greatest respect for Castle & Cooke and Murdock, 89, the island’s longtime owner.
“Look across Lanai and see a whole different community,” he said.
Meanwhile, Mike Carroll, owner of Mike Carroll Gallery on Lanai, told PBN that he is eager to find out what type of plan Ellison has for the island.
“It will be interesting to see what his plans are,” he said. “I wasn’t here when [David] Murdock bought it and built the resorts, so I’m not sure what people went through back then but I’m optimistic.”
Carroll, who has lived on Lanai for 11 years, says if anything, the buzz around Ellison may increase the interest in the island.
“I think our island is just a jewel off the beaten track just a bit,” he said. “You have to make one extra flight or take a ferry to get here and that keeps a lot of people away, but we hope more people will discover us.”
Lanai is believed to be the largest privately held island in the United States, with nearly 50 miles of coastline.
Murdock, in a statement released through Castle & Cooke, said he enjoyed being a part of the island community as it progressed through numerous social and economic changes.
“Lanai has been my passion for years and I have made huge investments of money, time and energy for the betterment of the island economy and its residents,” he said. “I built my island home there and will continue to remain a homeowner of Lanai.”
He said that exploring the possibility of new ownership of his Lanai holdings was not a new idea nor an impulsive decision, noting that the right time and the right buyer have been key components in his decision-making process.
“Paramount to this process was to ensure that a new owner would have the right enthusiasm, commitment and respect for the island and its people, and be a positive part of the island community in the years to come,” he said. “I believe that Larry Ellison will bring a new and fresh perspective to the island and its people. As a property owner on Lanai, I will continue to be a member of the community and will be looking forward to its future.”
In addition to his home on the island, Murdock will retain the rights to develop a potential wind farm on the remote northwestern part of Lanai.
Castle & Cooke, which Murdock owns, and Dole Food Co., Inc., of which the billionaire is the majority shareholder, have long histories in the state and will continue as one of its largest landowners.
Murdock will continue his real estate operations and other operating companies on Oahu, including his extensive land holdings; Castle & Cooke’s development of the proposed Koa Ridge master-planned community of 5,000 homes in Central Oahu; Dole Plantation, a retail store and park that is Oahu’s second most-visited tourist attraction, according to PBN research; Waialua sugar mill; diversified agriculture; renewable energy development; commercial development; aviation facilities and services; and commercial real estate development, leasing and sales including more than 700,000 square feet of space at Dole Cannery.
Wow! Beautiful. You know it was probably a bsinselg that you felt obliged to rest and take it easy. Sometimes vacations are not restful enough b/c we feel this weird compulsion to do everything and see everything while we’re there and when it’s over we have some fun memories but sometimes we never stop to decompress and just BE. So it sounds like you had a chance to do that and that must pretty nice. Especially in Hawaii.