Campbell heirs to divide $2.3 billion in assets in 2007

By Jim Dooley
Advertiser Staff Writer

Trustees of the massive Campbell Estate have filed a detailed court plan on how 31 Campbell heirs will divide $2.3 billion in assets when the estate terminates in 2007, with all but four of them favoring the transfer of most of the estate's assets to a surviving company the heirs would oversee.

With 27 of James Campbell's descendants opting for a new entity to administer the estate's vast holdings, which include much of the property in and around Kapolei, the beneficiaries said in court papers filed yesterday that they wanted "to build on the legacy of James and Abigail Campbell and the commitment of the Campbell family to the City of Kapolei and the greater Hawai'i community."

Three of the 31 heirs want to cash out, and it's estimated that their payout would amount to about $200 million, less 30 percent in taxes and other costs. One heir wants to take his share in the form of real estate, according to the plan. None of the heirs are named in court papers.

Four trustees of the estate, who are not heirs, each stand to collect about $5 million in fees at the time of termination.

The 56-page termination plan, along with various exhibits and supporting documents has been years in the making and marks the end of a historic era, begun when Scottish carpenter James Campbell disembarked from a whaling ship in the Islands in 1850. He was 24 years old and by the time of his death in 1900 he had amassed a fortune, principally in land holdings, valued at $3 million. Those holdings now amount to just under $2 billion and are projected to be worth $2.3 billion in 2007.

Campbell's will stipulated that when the last of his four daughters died, his estate would terminate within 20 years. That last daughter, Beatrice Cambell Wrigley, died in 1987.

Since then, the court plan filed yesterday said, the estate and its consultants have searched for "a termination strategy taking into consideration the concerns, needs and preferences of individual beneficiaries but which provides the greatest overall benefit to all the beneficiaries."

The planning looked at 13 different termination plans, but in the end "a substantial majority of beneficiaries came to a consensus that they desired to continue business after termination of the estate by participating in an ongoing entity," the report said.

A variety of factors were considered, among them the adverse tax consequences to beneficiaries if land holdings — much of it undeveloped — were sold to raise cash for distribution to the heirs, the report said.

The estate will borrow the money to pay beneficiaries who want cash at the time of termination, the report said. But if too many heirs change their minds and demand more cash between now and the termination date of Jan. 20, 2007, the plan will fall apart because the estate can't borrow that much money and continue as a viable business, the report said.

A detailed description of the surviving company, called the James Campbell Limited Liability Co., is attached to the trustees' plan filed yesterday, but it has been sealed because of "the competitive disadvantage that might result if it were made public."

Reach Jim Dooley at jdooley@honoluluadvertiser.com or 535-2447.