Boone Pickens: Rich Pickens

He’s the legendary oilman, philanthropist and plain-speaking billionaire from Texas. And on the eve of his 78th birthday, Boone Pickens is still busy making deals.

At 77, Thomas Boone Pickens, Jr., gets the same early start he’s had for over half a century. By 6:30am he’s at his Preston Center office in Dallas, where English antiques, photos of him with presidents and a huge picture of Mars paint an image of an individual who’s part conservative, part modern frontiersman. Pickens is a complex mix of genius and generosity, a study in the benefits of brilliance plus persistence.

It’s not yet 7am; his traders brief him on an explosion in Saudi Arabia that has affected access trading before the New York Stock Exchange opens, sending oil up $2 a barrel. The game’s afoot.

Among the handful of magazine covers featuring Boone Pickens on his office wall is the Time cover featuring him holding a poker hand. He was at the peak of his favorite game on March 4, 1985, wheeling and dealing the NYSE way. The headline: “The Takeover Game—Corporate Raider T. Boone Pickens” used a term Pickens despises. He prefers “shareholder activism” and is far more likely to see himself as David taking on Goliath than a snake in the woodpile, both analogies drawn in the Time piece.

Since 1985, Pickens’ rebound from personal and business reversals have given him a longevity that has made his seventies his wealthiest, most productive and happiest years.

A native of tiny Holdenville, Oklahoma, the son of a “land man” who bought and sold oil and gas leases, Pickens earned a geology degree from what is now Oklahoma State University (OSU). After three years with Phillips Petroleum, he borrowed $2,500 in 1954 to form Petroleum Exploration, Inc., a predecessor to his Mesa Petroleum.

Mesa went public in 1964, becoming one of the largest independents, producing trillions of cubic feet of gas and millions of barrels of oil over the next 32 years.

At Mesa, Pickens was the prince of merger mania in the 1980s. His take on corporate restructuring—buying up stock and threatening to acquire companies—proved the ultimate poker game. Stock prices went up, heartening stockholders and ushering in newfound corporate accountability as major oil execs quaked in their boots. “People like to see a big shareholder show up and start kickin’ things around,” Pickens says, remembering heady days.

Then came the 1990s, the storm before the calm. His forced exit and the sale of Mesa Petroleum after energy prices plummeted in the mid-1990s was a shock to his system amid rough years.

“The ’90s weren’t the best decade for me… It seemed hard, and I got so I felt bad,” he says, recalling the day his lawyer and friend told Pickens he was depressed, making poor decisions and in need of help.

After a short course of antidepressants, the magic was back. “I started getting lucky again, and within two or three months I was clicking along pretty good.”

When he and his second wife divorced in 1998, they divided $78 million. Pickens took his half and parlayed it into a personal worth estimated by Forbes magazine at $1.5 billion in 2005 (doubled from $750 million in the Forbes 400 of 2004) as the operator of a $4 billion company, BP Capital Management. “We’ll be in the top five hedge funds in the US for the year 2005, out of 8,000,” he notes.

Pickens’ portfolio includes a water marketing project that taps a West Texas aquifer in the hopes of selling the precious resource to a thirsty city. He also dabbles in ranch real estate and oil exploration.

Comparing his life to football’s triumphs and setbacks, he says the past seven years have been his best moments on the field yet. Last year, he wed his fourth wife, Madeleine, who owns southern California’s swanky Del Mar Country Club.

But, at 77, he senses the need to gain even more yardage. “I do think I’m in a rush. I don’t look at 20-year deals,” he says.

Still in good shape, Pickens has aged well since his Time cover in 1985. His secret elixir? The future. “I am a change advocate. I like change—and that attracts young people to me.”

Then there’s the fun he finds in giving. In 2005, Pickens’ charitable gifts of over $229 million generated a nod from the Chronicle of Philanthropy, which ranked him fifth among the nation’s givers in 2005.

With coffers of donated monies draining rapidly in the wake of Hurricane Katrina, he called on a provision in relief legislation that waived the usual alternative minimum tax (AMT). The Katrina relief bill permits deduction for a charitable gift in the amount of 100% of his adjusted gross income (twice the normal limit of 50%). Pickens made the single largest gift for Hurricane Katrina relief: $7 million to the American Red Cross. Then there was the $165 million to an athletic foundation for his Oklahoma State alma mater.

The OSU gift attracted criticism in a New York Times article. While it was legal and Pickens waived any fees, his BP Capital Management will look after the money for the foundation, of which he is on the board.

Pickens is unapologetic about his desire to watch over a major donation. To the scoffers who question gifts that come with specific directives attached, Pickens scoffs back. “I know what I’m doing—I don’t do foolish things,” he says.

In fact, he often matches or exceeds gifts given by those who ask him to donate. “My response is always, ‘What are you doing for them?’ That shows me how serious they are. We’re not going to just spend my money; we’re going to spend some of their money, too,” he says, grinning. “I’m convinced the Lord put me in this life to make money and be generous with it.”

On this particular morning, Pickens follows his usual routine. By 7am, the former high school basketball star heads to the gym down the hall, where he works the treadmill while eyeing oil prices on CNBC.

Back in the office, business is swirling. Around 11am, Maria Bartiromo from CNBC calls, presumably to talk about the Saudi deal. His day is gathering steam as he leaves for lunch with some oil executives.

“75 before 55,” he says cryptically, in a mix of Texan and oil lingo. “This is a big day for us—I killed every cat in the alley today.”

He’s clearly invigorated by the flurry of activity. It works for Boone Pickens.

BUILDING WEALTH THE BOONE PICKENS WAY…

Exercise dogged persistence: “You’ve got to really want to be successful.”

Have a strong work ethic: “Work hard. Come early, stay late. That’s the way leadership has to approach it.”

Fight your way out of corners: “I play pretty good off the wall.”

Stay in touch: “I always like to know everything that’s going on.”

Don’t twiddle your thumbs: “Everything here happens fast. There isn’t any standing-around time or looking at your watch.”

Keep up: “I never get behind.”

Always play fair: “I learned early on that you play by the rules. It’s no fun if you cheat to win.”

Don’t spread yourself too thin: “The thing where you throw the ball and catch the ball— that’s a pretty neat trick. I’ve done it a few times, but it’s not something you can do consistently.”

Be versatile: “We’re flexible, quick on our feet and able to get the job done.”

Find strength in numbers: “I built a team that’s really incredible. I’m a good team builder.”

Plow on: “If you’re on the right side of the issue, just keep driving until you hear breaking glass. Don’t quit.”