Some in the media practically shouted the headline that Amazon CEO Jeff Bezos was getting divorced. That in itself was not the issue, it was the fact Jeff and MacKenzie Bezos did not have a prenup despite the fact that Bezos is worth an estimated 137.1 billion dollars. In a gesture that may be seen as noble by some and foolish by others, the couple’s divorce is an amicable one and they are splitting the estate in half.
The couple is actually adhering to the community property law in Washington State, which like California stipulates that marital assets be divided equally. Financial experts put MacKenzie’s divorce settlement at $66 billion.
Prenup not an option, but postnup was
The couple met and married several years before Bezos made his first million in 1997. As such, practically all the wealth accumulated through the rise of Amazon and other ventures is marital assets. It is now more common for couples of modest means to draft a prenup, but the Bezoses were not unusual in eschewing a prenup in 1994. What is unusual, however, is that the couple never drafted a postnuptial agreement as Jeff’s business ventures flourished.
It is not just the money that is the issue
The eye-popping numbers involved in this divorce are hard to ignore, but the real issue will be how the settlement is to be paid. Jeff Bezos’s controlling interest in Amazon is 16 percent of the company’s stock (80 million shares), and he would likely have to sell stock as part of a divorce agreement. This could jeopardize control of Amazon as well as a long list of other assets like Whole Foods, Zappos, the Washington Post and many other companies. The couple is also one of the largest landowners in the country with 400,000 acres of property. It all adds up to an extremely large and complex portfolio that would take years to divide.
The key here may be that the split is extremely amicable. While divorces that start out amicable do not always stay that way after the negotiations begin, it appears that MacKenzie Bezos understands that it is better to leave major business holdings intact.
Lessons to be learned here?
Not all divorces are as amicable as the Bezoses appears to be. Couples entering into marriage need to at least discuss the option of a prenup, particularly if one of them owns property prior to marriage. Knowledgeable family law attorneys can help draft a prenuptial or postnuptial agreement that reflects the couple’s wishes and complies with California law.