It's closing in on 2 a.m., and Frank Giustra is standing in a crowded penthouse suite on Toronto's waterfront, a full bottle of beer dangling at his side. A steady stream of well-wishers stops to shake his hand, say thank you or even lean in for an awkward hug. At times, Giustra's smile is noticeably forced.
The mining mogul has been at this for hours, first at a $300,000-a-table fundraiser for his new poverty-relief charity--a glitzy event that drew a crowd of 1,200, including A-list celebs like Tom Cruise, John Travolta and Robin Williams--and now here, at the after-party.
The March 1 fundraiser has been a coming-out of sorts for the obsessively private Giustra. For a quarter-century, he has worked behind the scenes on a string of deals in the world of junior mining finance, finding money for companies hoping to extract gold in Mexico, cobalt in Cameroon, uranium in Kazakhstan, platinum in South Africa or oil in Colombia. In the process, he has made billions for himself and a cadre of loyal associates through a Byzantine system of shell companies, furtive share purchases and elaborate compensation schemes.
So how did he end up here, glad-handing with the glamorous elite?
The answer can be found in an oil painting propped up on a table in the middle of the penthouse. The picture (a gift from friends) features two men standing side by side, their arms draped around each other's shoulders, in front of a dusty outpost in Lesotho, a tiny enclave in the middle of South Africa. One of the men--the shorter one, with the silver, Caesar-style haircut--is Giustra, dressed casually in a T-shirt and bomber jacket. The other, in rolled-up shirt sleeves and tie, is the 42nd president of the United States, William Jefferson Clinton.
The painting captures a scene from a seven-country tour the pair made to Africa in July, 2006, to oversee the work of the William J. Clinton Foundation, the ex-president's charitable organization. It's just one of the trips he and Giustra have taken together on board the opulently appointed MD-87 jet, replete with leather furniture and a boardroom, that serves as Giustra's office in the sky.
Until a few years ago, the financier had only dabbled in philanthropy, funnelling money to local charities in Vancouver and organizing the occasional fundraiser at his $20-million, Parisian-themed mansion. Then he met Clinton, whose own charity efforts (which have, among other things, slashed the cost of HIV/AIDS medicines for 750,000 people in developing countries) inspired him to do what he calls "a complete one-eighty"--to stop hoarding the millions of dollars he's earned from mining deals and instead give much of it away. "When you are creating wealth, and the only purpose is to create more wealth than you already have, it is totally meaningless," says Giustra, who turned 50 last August. "It's empty. It's completely empty."
Since 2005, Giustra has pledged $31 million (U.S.) of his own cash to Clinton's foundation. Together, he and Clinton have also formed the Clinton Giustra Sustainable Growth Initiative (CGSGI), a charitable vehicle that will help create programs and distribute funds in areas of the developing world where mining takes place. Giustra has pledged another $100 million to this initiative and promised to donate half of his future earnings to the charity.
Clinton brings with him a well-oiled philanthropic organization and considerable star power. Giustra, meanwhile, has a Rolodex full of mining contacts with fat wallets--thanks in large part to the deal-making prowess of Giustra himself--and a hankering to put a positive face on the much maligned mining industry. "My money is more effective backing Clinton than any other person I can think of on this planet," he says.
With his new-found generosity, this hitherto unknown financier--an outsider even within the relatively small Canadian business community--has gained entree into the world of high-stakes philanthropy: charity events with U2 front man Bono, fundraisers co-hosted with jazz diva Diana Krall, face time with supermodel Petra Nemcova in the name of tsunami relief. And, of course, he has been welcomed into Clinton's inner circle as a bona fide Friend of Bill, or FOB.
But a funny thing happened on Giustra's journey from mining-deal king to munificent benefactor: At the same time he thrust himself into the media spotlight as the CGSGI's public face, Hillary Clinton's bid for the White House ratcheted up the scrutiny on her husband's business and charitable dealings, as well as those of his large network of associates. And it just so happens that Bill Clinton keeps popping up in places where Giustra is buying resource assets, leading to allegations that Giustra is using his powerful new friend to secure business for himself and his mining cohorts.
Giustra seems genuinely wounded by the implication that his donations are buying favours. "There's a perfect balance in this world," he says. "The more you put yourself out there, the more they are going to throw darts at you. Now, I'm seeing how that all works."
After nearly 30 years in the mining industry, Giustra has a vast network of loyal colleagues who have profited handsomely from his various projects. Call them the Friends of Frank, or FOFs.
FOF investment bankers get lucrative fees for consulting on his deals and underwriting share offerings. Bankers and brokers are invited to personally buy into Giustra's shell companies before he rolls in a new set of mining assets and the stock (usually) soars. FOF mining execs get board appointments, along with generous stock-option packages and so-called founder's shares, another form of cheap stock (see "Circle of Friends," page 51).
"Why is that bad?" Giustra asks rather defensively. He's seated at the head of the boardroom table in his Vancouver office a few weeks after the CGSGI benefit, casually dressed in a colourful striped dress shirt, dark jeans and brown loafers--he's due to serve lunch at his kids' school today, so no suit. (He recently separated from their mother, his second wife, former Internet venture capitalist and documentary filmmaker Alison Lawton.) "It's a good thing--people you know and you trust," he says. "People that you've been through good times and bad times with--especially bad times, because then you know what they are really made of."
For Giustra, the times have been mostly good. Certainly the mining industry has been better to him than it was to his father, Joe, who immigrated to Canada from Italy and worked as a blaster and driller. When Frank was a baby, Joe sent his wife and four kids to live with relatives back in Italy and, later, Argentina, while he moved from mine to mine in search of better wages. "While he was working to make the money to provide a home for us, he wanted us to be with family," says Giustra, who spoke no English when he moved back to Canada at age nine. "He was travelling all over the country, and he didn't want us living in mining camps."
Eventually, the family settled in Aldergrove, 50 kilometres southwest of Vancouver. Young Frank took up the trumpet--and jazz--and, at 18, he enrolled in the music program at a local college. But after paying a visit to his dad's stockbroker (Joe liked to play the penny stock market, with little success), he switched to business. "It was the energy," Giustra says of the brokerage. "There was just something about it--that people made a living doing this. I decided that was it, I was going to be a stockbroker."
Though he had a $14-an-hour union gig stocking shelves on the midnight shift at a Vancouver supermarket, Giustra began pestering local brokerages for a job. In 1978, he scored an interview at Merrill Lynch, known for its top-notch broker-training program. His interview lasted just 10 minutes. But on his way out the door, the 20-year-old made a ballsy promise: "If you hire me, I'll be the best broker you've ever had."
He got the job, and spent two years "trading the market blindly" before moving to Yorkton Securities, a small, Toronto-based brokerage with a handful of employees in Vancouver. The firm dealt with the top mining promoters on the wild and woolly Vancouver Stock Exchange, including Murray Pezim, who once controlled more than a quarter of the trading on the VSE and whose name was synonymous with the era's loose ethics. "The whole concept of compliance and due diligence, things we take for granted these days, didn't really exist back then," says Giustra. "It was pretty much the Wild West."
A key element of Yorkton's early success was its ability to tap investment funds in Europe. So in 1983, Giustra's bosses sent him to London to open the firm's first overseas outpost. He hated London at first. The food was awful, he says, and the business culture was ultraconservative--nothing like the VSE. "You couldn't even wear a brown suit in those days. You certainly couldn't wear brown shoes," he says. "If you wore brown shoes in the City, you were deemed someone not worthy of doing business with."
Giustra put together a unique team of analysts, traders, corporate financiers and institutional sales staff dedicated solely to mining, and the London office thrived. When Giustra returned to Canada in 1990--as Yorkton's president--he brought the model with him, and soon the firm was a leader in the mining sector, with a list of deep-pocketed institutional clients willing to invest in hundreds of junior miners looking for exploration and development funds.
Under Giustra, Yorkton also devised creative ways to help clients and colleagues win the rights to lucrative mineral deposits overseas. The Soviet Union had just fallen, and many former Soviet states began opening their borders to foreign investors. Giustra had the bright idea of hiring an ex-finance minister from Chile to help these nascent countries draft new mining codes. Among the nations Yorkton worked with was Kazakhstan. "We advised them on what they needed to do to change their mining laws," says Giustra, who met with the Kazakh prime minister, Akezhan Kazhegeldin, in 1995. "We did that in Africa; we did that in South America. It was a great way to look credible. It was a great way to look serious about what our intentions were, in terms of being able to do business in a fair way. It worked really well." It also demonstrated the inherently political nature of nearly all mining deals: Without government support, you're unlikely to get far in the quest for mineral rights. Sending in experts to help draft mining code is just one way to get a leg up.
Nearly everyone at Yorkton got rich during those days, the peak of junior mining finance. Million-dollar-a-year pay packages were the norm, and Giustra made several times that. He and his colleagues were often given so-called seed shares or allowed to buy in on private placements in the companies they financed. Yorkton was awarded broker warrants on financings that proved particularly profitable if the company's shares rose. "He always made his clients and the people around him money," says Paul Reynolds, who got his start at Yorkton in the 1980s and is now CEO of Vancouver-based Canaccord Capital Inc. "I think that's paramount to Frank: He likes to make people money."
Or, as Giustra says: "The one thing that always worked for me is generosity. Generosity can be very profitable."
In 1995, the same year Scott Paterson joined Yorkton as executive VP, Giustra was promoted to chairman. A year later--around the time the firm's Calgary office became mired in a scandal involving salted drill samples by a high flier called Timbuktu Gold--Giustra quit. He was just shy of his 40th birthday. A few months later, the Timbuktu scandal was eclipsed by Bre-X, which brought the go-go days of junior mining to a definitive end. (Under Paterson, Yorkton jumped into high tech and eventually became the subject of an OSC investigation.)
By then, Giustra was far away from the world of Howe Street--figuratively, at least. With $60 million raised from FOFs, a $60-million IPO and $18 million of his own cash, he started Lions Gate Entertainment, Canada's answer to the Hollywood studio. Giustra was used to quick returns on the VSE. But Lions Gate's film projects took years to turn a profit (if at all), and the company, which went public in 1998, was soon strapped for cash. Things got so bad that Giustra was occasionally forced to cover the payroll himself. The stock flatlined (see "Lion's share," page 52).
Then came a costly deal with Peter Guber, the former head of Sony Pictures, that almost killed the company. Giustra--renowned in mining circles as a fierce negotiator--agreed to pay Guber $50 million (U.S.) for a 45% stake in his production company, Mandalay Pictures. Guber was expected to make 20 movies over five years for Lions Gate. He turned out just five before the company sold its Mandalay stake back to Guber for $10 million in 2002. "It was a dumb deal for us," Giustra concedes. "Did he get the better of us on the negotiation? Yes, absolutely."
Within a year, Giustra had sold off his stake in the studio and returned full-time to the world of mining. Back in 2001, he had become convinced that gold, then trading below $300 (U.S.) an ounce, was poised for a run, in part because low interest rates would erode the value of the U.S. dollar--a stunningly accurate prediction. Along with Ian Telfer, a gregarious veteran mining executive who'd taken a wrong turn in the dot-com world, he bought a controlling stake in Wheaton River Minerals, a dormant mining company then valued at $20 million.
Wheaton's first major acquisition was the Luisman mine in Mexico. The seller, Antonio Madero, the scion of a powerful Mexican family, was skeptical that the Canadians could afford the mine's $100-million price tag. After all, they had just $25 million in capital. Giustra, however, was certain his FOFs in the brokerage community could raise the cash--but only if there was a sale agreement in place. Over dinner at Club 21 in New York in late 2001, Giustra, Telfer and a group of advisers set about trying to persuade Madero to give them a chance. The meeting was going nowhere until someone mentioned that Madero was chairman of the Mexican National Art Museum. Giustra sprang into action, talking up several pieces of Latin American art in his personal collection. Madero decided to let the Canadians make a bid. "That's what tipped the scales," says Telfer.
The team went on to raise more than $125 million from investors (through a syndicate of underwriters led by GMP Securities, Canaccord and BMO Nesbitt Burns) to finance the acquisition. Four years later, Wheaton merged with Goldcorp to create what is now the world's second most valuable gold producer, with a market cap of more than $28 billion. "It was certainly the greatest success in terms of a business story," says Giustra. "All the stars aligned. I don't think that's going to be repeated in a while."
But the Wheaton deal was almost the undoing of a long-time FOF, Egizio Bianchini, BMO's global head of metals and mining. And it was a reminder to Giustra's other pals that the perks of FOFdom come with strings attached.
Before hooking up with Goldcorp, Wheaton had tried to orchestrate a merger with Toronto's Iamgold, which quickly drew a rival bid from U.S. gold miner Golden Star Resources. Giustra was livid, particularly because BMO had agreed to represent Golden Star. Bianchini bore the brunt of Giustra's rage. "You are a real fucking Einstein," Giustra wrote Bianchini in a terse e-mail.
"He felt betrayed," Bianchini says now. "I didn't think he was going to take it like that. I thought he would say, 'This is business.' But no, he took it quite personally." Wheaton's bid eventually failed; so did Golden Star's. Giustra couldn't resist sending Bianchini another missive. "There you go, fucking Einstein," it said.
The two men didn't speak for more than a year. "Those weren't jokes when he sent those e-mails," Bianchini says. "That was hatred. That was pure hatred." Eventually, however, BMO and its mining boss made their way back into Giustra's good books. Bianchini is once again an FOF. "I have a lot of time and admiration for Frank," he says. "He's a good, solid business guy. He's made a lot of people money. He can be tough, but he can be extremely charming as well."
BMO won a minor role in Giustra's next big score: a uranium play in Kazakhstan that turned a $450-million investment into a $3-billion buyout in less than two years. That same deal is at the heart of the bad press dogging Giustra and his good friend Bill Clinton.
A diminutive bundle of intensity, Giustra bristles at questions about his family. "I have a private life, and all that stuff is private," he says icily. "I want to keep it that way." (He won't confirm that since splitting from Lawton, he's vacated his Vancouver mansion and moved into a condo.) He's particularly touchy about his private jet. Even Gordon Keep, a 20-year FOF and Giustra's right-hand man, has only taken two trips aboard Air Giustra. Yet if it weren't for the plane, Giustra never would have met President Clinton, and it's where they've spent the majority of their time together. So, will Frank give me a glimpse of the MD-87?
"Let me explain something," he says. "The plane is a business tool. No more, no less. It ain't Lifestyles of the Rich and Famous. That's not my place. To me, that's not the story." Giustra is getting more and more worked up. "This is not about me flying around on a plane. I keep it for business reasons. It works well. It gets the job done. It's not champagne and caviar."
Those who've seen it, however, say Giustra's ride is stunning. Phillip Shirvington, a uranium industry veteran who's been on plenty of private jets in his time, says Frank's plane tops them all. "His is the best I've been on by a long shot," he says. "It's just beautifully done out."
It was June, 2005, when Giustra and Clinton took their first trip aboard the MD-87. Earlier that year, Giustra had hosted a tsunami-relief fundraiser that featured a videotaped thank-you address from Clinton. Afterward, he told the ex-president's handlers he was looking for other ways to support Clinton's charitable work. They came back with a request: The foundation needed a plane for a planned tour of Latin America. Could the President borrow Giustra's jet? He was thrilled to oblige, and even more thrilled when he was invited to tag along.
Giustra says he and Clinton hit it off immediately. They're both voracious readers and can talk for hours about geopolitics, history and, of course, philanthropy, he says. (Giustra admits to hoovering up all the information he can gather on any subject that piques his interest. "Any time I get into a project, whether it is for profit or non-profit, I take it seriously," he says. "I think about it carefully and it becomes my entire focus.") They're also both nighthawks, getting just three or four hours of sleep. In the wee hours, he and Clinton sometimes play cards--Clinton's favourite game is Oh, Hell, a complicated variant of bridge.
Giustra sees himself as a problem solver, and he says Clinton is the ultimate fixer. "If you were with a person for weeks on end, day and night, and there was any sense of BS in that person, there is no doubt you'd see it," says Giustra. "I'm telling you, he is who he is. He is a tireless worker who really cares about fixing things. That's his whole MO. All he wants to talk about is fixing problems--the more creative, the better--and he generally wants to fight for the underdog. That's the makeup of President Clinton."
Indeed, no former president has raised more money for charity than Bill Clinton: well over half a billion dollars. At the same time, no other president has personally earned so much, so quickly since leaving office. Bill and Hillary have taken in $109 million (U.S.) since they left the White House in 2001. He has made $51.9 million (U.S.) from speeches, and another $29.6 million (U.S.) from advances and royalties on his books, including Giving: How Each of Us Can Change the World.
Like many former heads of state (Brian Mulroney and Jean Chrétien come to mind), Clinton has also earned millions from his personal business dealings. Since 2002, Clinton has collected more than $12.5 million (U.S.) as a rainmaker, consultant and investment partner with Yucaipa Cos., a Los Angeles investment firm headed by his friend, billionaire playboy Ron Burkle. He received another $400,000 (U.S.) last year from InfoUSA, the Nebraska-based marketing firm headed by Vinod Gupta, a friend and political supporter. As Gupta explained last year to a Nebraska newspaper: "He helps us meet some of the right people."
In September, 2005, Giustra and Clinton reunited for another trip aboard the jet. This time, it was a three-country tour in support of the Clinton Foundation's fight against HIV/AIDS. The first stop was Kazakhstan, which holds more than 20% of the world's uranium reserves. It just so happened that Giustra was looking for a uranium play. He had a hunch that, thanks to years of under-investment and a looming supply crunch as nuclear power returned to favour, the price would soon skyrocket. A year earlier, he'd put together a reputable management team, including mining veterans Phillip Shirvington as CEO of a yet-to-be-named company and Ian Telfer as chairman, and started shopping for assets. They zeroed in on Kazakhstan, where, 10 years before, Giustra had met with the PM. The state-run mining company, Kazatomprom, wanted to boost the country's uranium production and was looking for foreign investors to buy out some of its joint-venture partners. If Giustra and his team wanted to bid, they'd need Kazatomprom's blessing. With help from Canaccord, which had extensive experience in the country, as well as from Russian mining executive Sergey Kurzin, another FOF who'd done business there, Giustra and his team set out to win a meeting with Kazatomprom president Moukhtar Dzhakishev.
Once again, Giustra's jet came in handy. After months of lobbying, and a short ride in the MD-87, Dzhakishev agreed to work with Giustra's syndicate. They homed in on three uranium deposits partly controlled by two private holders. One of them--the chairman of a Kazakh bank and a former minister of energy, industry and trade--was proving a reluctant seller.
As the negotiations reached their final stretch, Giustra and Clinton landed in Kazakhstan with a sizable entourage. They were treated to a midnight supper with President Nursultan Nazarbayev, a onetime steel worker who has controlled the country for nearly two decades. For Nazarbayev, the visit from Clinton was a major triumph. The dictator had been lobbying to lead the Organization for Security and Co-operation in Europe, a pro-democracy group that monitors elections and promotes humanitarian, environmental and economic initiatives in the developing world. Most U.S. politicians, including Senator Hillary Clinton, had publicly opposed his bid. But during that visit to Kazakhstan, Bill Clinton expressed his support for Nazarbayev's application.
At dinner that night, Giustra engaged in "small talk" with Nazarbayev. "I can't remember if it was a talk about uranium mining or my interests in Kazakhstan overall," Giustra says. "It was a general chit-chat about mining and the fact that I had done business in Kazakhstan. If we talked about the uranium stuff, it would have been just in passing."
Three days later, on Sept. 9, the holdout agreed to sell his stake to Giustra's group for $450 million (U.S.). The price was hefty, considering uranium was then going for less than $40 (U.S.) a pound (it would soon run to more than $130). Giustra is adamant that neither Nazarbayev nor Clinton had anything to do with the transaction. "The facts are the facts," he says. "We bought these assets from private individuals, and we paid full price. It had nothing to do with Bill Clinton."
The deal paved the way for the creation of UrAsia. Its stock market debut (a reverse takeover of a Giustra shell company) in November, 2005, was the largest ever on the TSX Venture Exchange, giving the company a value of more than $500 million. Just over a year later, UrAsia accepted an all-stock takeover bid from Toronto-based SXR Uranium One (now called Uranium One) worth more than $3.5 billion. UrAsia's directors, including Telfer, Bob Cross (a former colleague of Giustra's in the brokerage business) and Douglas Holtby, the ex-chairman of Wheaton, each had stock options valued at over $4 million when the bid was announced. Giustra's personal stake in UrAsia was valued at more than $45 million at the time.
The relationship between Giustra and Clinton has provoked a firestorm of interest from the U.S. media. The New York Times first broke the story of their trip to Kazakhstan this past January. Shortly after that, The Wall Street Journal reported that Clinton also introduced Giustra to the president of Colombia, Alvaro Uribe. Last year, a Giustra-connected shell company, now called Pacific Rubiales Energy, paid $250 million for control of a Colombian oil-field operation. As part of the deal, Pacific Rubiales, which now trades on the TSX, became a partner of Ecopetrol SA, Colombia's state oil company.
Although these cozy deals may be unseemly to some, there's nothing illegal--or even particularly unusual--going on here. Plenty of former heads of state mix business, politics and philanthropy on a regular basis, and both Giustra and Clinton have strongly denied that their relationship crosses the line. For Clinton, who declined to be interviewed for this story, the whole thing is a minor nuisance--one of many he's encountered during his political career and, more recently, during his wife's long (and ultimately unsuccessful) run at the White House. For Giustra, even a hint of impropriety could have a lasting impact on the legacy he's trying to build. He's already struggling with a credibility problem. To start with, he comes from the wrong side of the tracks--a Howe Street promoter rather than a Bay Street blueblood. His career has been highlighted by schemes and structures that quietly enriched him and his tight circle of friends. Constructing deals for mining concessions in war-torn and developing nations is rarely a squeaky-clean process; though Giustra has never broken the rules, he has pushed them to their limit.
To some, his massive donations to the Clinton Foundation suggest a kind of quid pro quo: Clinton has gained access to hitherto untapped sources of donations for his charity, plus unfettered use of the Giustra plane, not only for his foundation work but also to jet to Hillary's nationwide campaign events and to lucrative speaking engagements. Giustra has gained one seriously powerful pal with friends in just about every country on the planet.
The financier insists his aim is true. He's not going to stop doing mining deals--"I still love doing deals. I absolutely love doing deals," he says. But his sole raison d'être now is to put the profits toward aiding those who need it most--with or without Clinton's help. "I don't need Bill Clinton," says Giustra. "I created my wealth long before I met Bill Clinton. I was successful long before I met Bill Clinton. I was meeting heads of government long before I met Bill Clinton. I have no interest in using him to enhance my wealth. I told him right at the beginning, my only interest was seeing if there was a way we could work together philanthropically, and that is what we've done."
The whiff of controversy hasn't stopped more than 1,200 people from packing the ballroom of the Westin Harbour Castle Conference Centre in support of the Clinton Giustra Sustainable Growth Initiative. A towering John Travolta weaves his way among the tables, greeting fans as they dig into their beef tenderloin and dainty organic greens. Eugene Levy, the evening's MC, cracks wise about Giustra's jet. His post-meal face towel on the flight, he deadpans, was "slightly tepid."
Travolta, Tom Cruise and Robin Williams each take turns at the podium, imploring the crowd to dig deep and give. Elton John, Shakira, Norah Jones, Burton Cummings and Wyclef Jean each perform a few songs on the ballroom's stage. "There's lots of money in this room. I'm trying to get into the mining business myself," Jean says during one number.
Giustra has Clinton to thank for bringing in the big names. But the tables are packed with star-struck FOFs, and they're ready to back up Giustra with their chequebooks. After all, if it weren't for him, their bank accounts would be considerably less stuffed. Cross donates $500,000. So does Neil Woodyer, the CEO of Endeavour Financial, where Giustra was chairman until June, 2007, and where he is still an adviser. From a table that includes GMP Securities' superstar trader Mike Wekerle comes $1 million. Paul Reynolds personally pledges another million, while Frank Holmes, the Canadian head of a Texas-based resource fund and the chairman of Endeavour Mining Capital (Endeavour Financial's parent firm), adds $100,000 to the cause (bringing his total contribution to $2 million). Sergey Kurzin, a crucial player in the UrAsia deal, chips in another $1 million. Finally, Telfer, who has been inextricably linked to Giustra for the past decade, signs a personal cheque for $3 million. "This is a good time for our industry. It's time for us to give back," Telfer tells the crowd. By the end of the night, Giustra's guests would pledge more than $16 million to the CGSGI. And Telfer would privately acknowledge that his very public display of support was meant in part to declare his commitment to his old friend, who has had to suffer the media's slings and arrows: "If there was ever a time to stand by Frank, this is it."
Clinton is also standing by his new best man--now one of the Clinton Foundation's top three backers. As he tells the crowd, he's seen firsthand the good that Giustra's cash has done in the places that need it most. "I'd look around, and I could actually count the number of children who were alive in the world because of the money he'd given me," Clinton says in his familiar southern lilt. "None of this would have been possible if Frank Giustra didn't have a remarkable combination of caring and modesty, of vision and energy and iron determination.
"And lately, a little bit of rhinoceros hide too--to take the incoming fire occasioned only because his partner was inadvertently dragged back into American politics," Clinton drawls. "I love this guy, and you should too."
Clinton and Giustra embrace. The hug is strong and sincere. There's nothing awkward about it.
During Giustra's turn at the podium, he says, "People ask what our motivations are. Well, it's morally the right thing to do. And of course it is smart business. Of course it is. But as President Clinton noted in the last paragraph of his book Giving, it makes us feel happy."
Giustra, it seems, is warming to his role as the face of philanthropy in the mining sector--though he insists it's a role he accepted reluctantly, knowing all the attention his association with Clinton would bring. Others in the mining industry aren't so sure. They say he loves the limelight and works keenly to ensure the notice he does receive is positive. The day before the Journal story ran, for instance, Giustra sent an e-mail to friends and donors. Both the Times and the Journal stories, he wrote, were an "amalgam of half-truths and innuendo...driven by the upcoming U.S. presidential elections. Nevertheless, as friends and supporters of the work we are doing with the CGSGI, I wanted to give you a heads up."
Either way, Giustra's enthusiasm for philanthropy now verges on fundamentalism. Clinton's foundation, he says, stands to gain millions--even billions--more in donations from his mining colleagues to help eliminate poverty in the very countries where those same miners do business. So far, the CGSGI has allocated only $20 million of more than $300 million it has received in pledges, announcing a handful of social development and anti-poverty programs in Colombia and Peru. Africa could be next, following a $100-million commitment from the family charity of long-time FOF and mining mogul Lukas Lundin, Lundin for Africa.
Back in his Vancouver office, with its million-dollar view of the harbour and mountains, Giustra struggles to explain his transformation. It sounds, at times, like he's trying to close a deal. "We live in a cynical world. It's hard not to be a cynic. The sure cure for being a cynic is to go see up close and personal what goes on on the ground in all these countries--the suffering, the death. Talk to the people, see the joy that you're bringing," he says. "I don't care how hard of a businessman you are or how hard of a journalist you are, seeing this stuff up close and personal will make any hardened heart all squishy again. Okay?"
Giustra's voice gets louder. "If more people did that, we wouldn't have all this cynicism about what the motivation is for Bill Clinton setting up his foundation. He's helped literally hundreds of thousands of people. He's saved literally hundreds of thousands of lives, and it will probably end up being millions of lives. CGSGI on its own, with the hundreds of millions we've raised, and the probably billions we're going to raise, we'll probably improve the lives of millions of people around the world. Give people hope, get kids through school, create jobs, create opportunities. That's what this is all about."
CIRCLE OF FRIENDS
A small cadre of players--executives, investors, consultants and underwriters--have a hand in many of the junior mining deals being done in Canada at any given time. At the centre of this web is Frank Giustra, who repays the loyalty of friends and partners with lucrative roles in his various mining-related endeavours. Many of these same people are also major donors to the Clinton Giustra Sustainable Growth Initiative
Chairman of Goldcorp Inc.
CGSGI donations $3 million
Silver Wheaton, UrAsia Energy, Kadywood Capital, Peak Gold, Wheaton River
Texas-based fund manager and head of U.S. Global Investors Inc., and chairman of Endeavour Mining Capital
CGSGI donations $2 million
Pacific Rubiales, Peak Gold, Wheaton River, Endeavour Mining Capital, UrAsia Energy, Lundin Mining
Chairman of Franco-Nevada Corp. and former president of Newmont Mining Corp.
CGSGI donations Newmont pledged support for the charity when it was launched in 2007
Peak Gold, Wheaton River
Head of the Lundin Group of Cos., and chairman of Lundin Mining
$100-million pledge (through Lundin for Africa)
Endeavour Mining Capital, Fortress Minerals, Bayou Bend Petroleum
BMO's global head of metals and mining
CGSGI donations BMO paid $600,000 for two tables at the March 1 benefit
Peak Gold, Wheaton River, UrAsia Energy
CEO of Canaccord Capital and global head of Canaccord Adams
CGSGI donations $1 million (he has also held Clinton Foundation fundraisers at his London home)
Peak Gold, Pacific Rubiales, UrAsia Energy, Bayou Bend Petroleum, Wheaton River
Chairman of investment dealer GMP Securities
GMP will hand over a percentage of mining-related revenue
UrAsia Energy, Wheaton River, Pacific Rubiales, Silver Wheaton, Peak Gold
Frank Giustra started Lions Gate in 1998 and produced a string of so-so films--and two Oscar winners--before selling his stake in 2003 (since then, the studio has delivered dozens of hits at both the box office and on the awards circuit). Here's a rundown of films produced during Giustra's spell as movie mogul:
AMERICAN PSYCHO (2000)
Star power Not-yet-famous Christian Bale as
New York investment banker turned depraved killer
Budget $9 million (all currency in U.S. dollars)
Box office $34.3 million
SLEEPY HOLLOW (1999)
Star power Directed by Tim Burton
and starring Johnny Depp as Ichabod Crane
Budget $65 million
Box office $206 million
GODS AND MONSTERS (1998)
Star power Ian McKellen as gay British 1950s horror director James Whale
Budget $3.5 million
Box office $6.4 million*
MONSTER'S BALL (2001)
Star power Halle Berry as the wife of an executed prisoner (the performance won her an Oscar), and Billy Bob Thornton as the racist prison guard who falls for her
Budget $4 million
Box office $44.9 million
SHATTERED GLASS (2003)
Star power Hayden Christensen (Anakin Skywalker) as journalist Stephen Glass, who fabricated dozens of articles for The New Republic
Budget $6 million
Box office $2.9 million
THE CAT'S MEOW (2001)
Star power Directed by critical fave Peter Bogdanovich, about a murder on William Randolph Hearst's yacht
Budget $7 million
Box Office $3.6 million
*U.S. box office only
- Report on Business Company Snapshot is available for:
- LIONS GATE ENTERTAINMENT CORP.