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Zapata Corporation Business Information, Profile, and History

1717 St. James Place
Houston, Texas 77210
U.S.A.

History of Zapata Corporation

Slated to become one of the ten largest Internet companies in the world, Zapata Corporation is involved in Internet and electronic-commerce businesses, operating an Internet portal and two on-line magazines, Word and Charged. Formerly an international oil and gas conglomerate, Zapata suffered profound financial losses during the 1980s, which eventually led the company away from energy-related businesses and toward its new identity, adopted in April 1998, as an Internet-related business. Zapata also maintained a 59.7 percent stake in a former wholly owned subsidiary named Omega Protein Corporation, which caught and processed fish for use as livestock feed.

1980s Spark Change

Zapata got its start in 1953 as an independent oil and gas venture launched by future President of the United States, George Bush. Bush, in his years before entering the national political spotlight, formed the company with the help of another distinguished individual, Pennzoil chairman J. Hugh Liedtke. Together, the pair set in motion a corporate entity that matured into a sprawling force in international energy-processing, with corporate reaches into a spectrum of diversified businesses, including natural-gas compression, off-shore drilling, and coal mining. At its peak as a global conglomerate, Zapata collected as much as $350 million in annual sales, exerting itself as a formidable force in its various industries. However, the most intriguing chapter in the company's history began when its encouraging success started to unravel at an alarming speed, long after both Bush (who cashed in his stake in 1966) and Liedtke had left Zapata to pursue other interests. In the wake of the company's sanguine years, debt accrued to a deleterious magnitude, touching off a two-decade period that saw the company scramble to forestall bankruptcy while it grappled with shaping a new identity for itself over and over again. The search to find a solution to its profound problems steered Zapata far away from its original business, into a field Bush and Liedtke could never had imagined.

Zapata's troubles began in the early 1980s, when long-time leader R.C. Lassiter headed the company. At that time, company executives foresaw an imminent drop in oil prices, the beginning of what proved to be a disastrous decade for the U.S. petroleum industry. In an effort to increase Zapata's market share before oil prices fell, company management directed the construction of 12 offshore drilling rigs, launching one last big push to dominate rival firms before the expected price plunge. The addition of the 12 new rigs did not deliver its intended effect, however. Instead, the imprudent construction of a dozen offshore drilling rigs delivered a blow to Zapata, saddling the company with enormous debt. When the fortunes of oil exploration took a downward turn, Zapata was left exposed to the fiercest effects of the industry-wide slump, unable to maneuver itself in a proper direction under the weight of more than $600 million of debt. In early 1985, Zapata reported a profit for its first quarter of business, but for years afterward the company reported financial losses, all largely because of the misguided decision to expand before the petroleum market contracted. As a Zapata spokesperson later noted in reference to the early 1980s expansion, "Those rigs turned out to be a turkey."

While the remainder of the 1980s would be bleak years for Zapata, there was one positive aspect of the company's business during the decade that would provide a glimmer of hope for the future: fishing. With a 57-vessel fleet at its disposal, Zapata caught fish&mdash′imarily menhaden--in the Gulf of Mexico and Chesapeake Bay. Menhaden, fish used as a source of fish oil, fertilizer, and bait, were processed and converted into livestock feed, from which the company realized a sizeable profit. To supplement its oil and gas exploration business and its commercial fishing operations, Zapata was also engaged in providing offshore services through Zapata Gulf Marine Corp. Started by Zapata, Houston Natural Gas Corp., and Halliburton Co., Zapata Gulf Marine, 34.7 percent owned by Zapata, made its debut in 1984, roughly a year before the oil drilling losses manifested themselves on Zapata's balance sheet. The subsidiary company, along with the marine protein operations in the Gulf of Mexico and Chesapeake Bay, stood as two potential saviors for Zapata during the latter half of the 1980s, although neither performed well enough to compensate for the deep losses stemming from oil drilling.

As the mid-1980s began, the race to stave off bankruptcy began as well, with Zapata's financial health becoming increasingly grave with each passing year. The company lost money in 1985, 1986, and again in 1987, when losses totaled $156 million on $146 million in revenues. A $600 million debt restructuring saved Zapata from bankruptcy in 1987, giving the company temporary relief, but, for the company to look forward to long-term financial health, Chairman Lassiter and his executive management team needed to find solutions that addressed the fundamental problems the enterprise faced. Lassiter began slashing costs wherever he could, and he began shedding assets that were dragging the company deeper into debt.

Through his efforts, overhead was reduced by 50 percent and more than $200 million worth of oil and gas properties were removed from Zapata's portfolio. These measures, undertaken to create a more efficient and, with hope, profitable company, were enacted roughly at the same time Lassiter's team engineered two shrewdly timed acquisitions. The company acquired two financial services companies and then resold them, netting a quick $65 million profit. This maneuver, coupled with $10 million of cash flow--the one encouraging figure amid a host of plunging financial totals--and the steps taken during the company's restructuring, fanned a modicum of optimism at corporate headquarters, a positive perspective that some industry observers were quick to embrace. Forbes magazine, in particular, began pronouncing the potential recovery of the destitute Zapata, citing its encouraging cash flow, the significant reduction of overhead, and Zapata's flourishing commercial fishing business as the ingredients for a successful turnaround. As would be the case during this difficult period in Zapata's existence, however, hopeful expectations frequently were dashed.

Those who hoped for a more positive end to the 1980s for Zapata generally embraced the theory that the company's robust fishing operations and its leaner oil service division would allow it to cover interest payments on its debt and then realize annual gains of 25 percent for 1989 and 1990. They were wrong. Zapata's fishing operations did record great gains, more than doubling operating income in 1988, but the increase was not enough, falling short of pundits' projections. A drought had increased the Gulf of Mexico's saline content, which consequently depressed Zapata's fish catch from an expected 950,000 tons down to 725,000 tons. Moreover, the adverse weather hurt the company in the one area it could ill-afford to suffer any damage. Commercial fishing had become increasingly important to Zapata, accounting for 47 percent of the company's revenues when drought and high levels of saline conspired to reduce the year's fish harvest. This unforeseeable problem, combined with a still-suffering offshore drilling business and a struggling oil service business, crippled the company.

The company's precarious financial position entering the 1990s led to another corporate-wide, comprehensive restructuring, the failure of which, company officials admitted, would likely lead to Zapata seeking protection under federal bankruptcy laws. Zapata teetered on the brink of insolvency, having not declared a profit since the first fiscal quarter of 1985 and having just come off a $42 million loss for the nine months ending June 1990. As the essential restructuring progressed, the company announced in September 1990 that it had signed a definitive agreement to sell its offshore drilling rig fleet for $298 million. The properties were sold to a European investment group in an agreement that stipulated Zapata would continue to oversee the 12 rigs under a management contract. Meanwhile, company officials announced their plan to concentrate on the growth of Zapata's three remaining businesses--offshore services, commercial fishing, and natural gas--until conditions improved for more sweeping, fundamental changes.

By the end of 1991, Zapata officials could at last glance at the company's balance sheet without wincing. After registering a $105 million loss in 1990, the company ended 1991 by posting a $2 million profit. Company executives used the momentum built up to push ahead in 1992, when Zapata found itself in a position to make an acquisition. The company's management contract for the 12 rigs it had built in the early 1980s expired in October 1992, creating a void that was filled the following month when Zapata re-entered the oil business through the acquisition of the Cimmaron Gas Cos. A Tulsa, Oklahoma-based private holding company, Cimmaron owned a variety of natural gas compression, processing, and marketing companies that, combined, generated annual revenues of approximately $180 million. Shortly after the completion of the acquisition, Zapata announced its plans to make further acquisitions and use Cimmaron as the foundation for a deeper presence in the gas-gathering and service industries. Highly fragmented, these two industries were beginning to consolidate, the prospect of which encouraged Zapata executives to make additional acquisitions.

Infighting in the 1990s

The calm that was beginning to settle by the end of 1992 was next interrupted by a shareholder power struggle. At the heart of the power struggle was Florida financier Malcolm I. Glazer, who, among various other business holdings, owned the National Football League's Tampa Bay Buccaneers, for which he paid a record-setting $192 million. Glazer owned roughly 33 percent of Zapata's stock, acquiring the shares in 1990 when Zapata was desperately fighting to avoid bankruptcy, and threatened a proxy fight in mid-1993 to install himself and his two sons to the company's board of directors. With this fight looming by the end of June, Zapata hired a New York-based firm specializing in fighting takeover attempts to assist in its bid to re-elect Lassiter and two other candidates. The struggle ended peacefully after Lassiter and Glazer reached an agreement that resulted in the re-election of Lassiter and the appointment of Glazer and one of his sons, Avram Glazer, to Zapata's board of directors.

At the time of the internal tumult, Zapata was continuing to pursue its new business strategy of increasing its presence in the natural gas processing and marketing segments of the energy industry. However, with Glazer occupying a position of power from mid-1993 forward, the company's strategic objectives would change. Glazer's control over Zapata increased significantly when Lassiter retired in July 1994, vacating positions that Glazer took over when he was elected the company's chairman, president, and chief executive officer. Now fully in command, Glazer began taking actions that promised to change the face of Zapata entirely, as he sought to create a company more in tune with his talents and his business empire, which included real estate, television, health care, and food service companies.

After a plan to sell the company's commercial fishing operations was cancelled in April 1995, Glazer completed the sale of Zapata's gas compression business, operated by a subsidiary named Energy Industries Inc., to Enterra Corp. for $130 million. Glazer also sold the company's five remaining oil and gas leases and a 31-mile natural gas gathering pipeline, further stripping Zapata of its former mainstay business lines. Next to go was Cimmaron, the natural gas compression, processing, and marketing company acquired in 1992, which was sold in April 1996 for $24 million, leaving a 25 percent stake in Bolivian natural gas properties as the only energy concern owned by Zapata. Soon, the Bolivian properties would be sold as well, as Glazer moved forward with his plan to create a new kind of Zapata for the 1990s.

A New Zapata Takes Shape for the Late 1990s

Glazer did not reveal his plans for what type of business Zapata would enter until a merger was announced in early 1996 that would wed Houlihan's Restaurant Group, operator of a chain of nearly 100 casual-theme restaurants, and Zapata. Two Zapata shareholders immediately protested the proposed acquisition, arguing that the deal unfairly benefited Glazer, who owned 35 percent of Zapata and 73 percent of Houlihan's. In response to the suit filed by the two shareholders, the Delaware Court of Chancery ruled that 80 percent of Zapata's shareholders--a "supermajority"--were required to approve the merger before it could be completed, a ruling that prompted Glazer to terminate the deal in October 1996. His plan thwarted, Glazer made his next major move eight months later when he achieved his goal of ridding Zapata of all its energy-related assets.

In July 1997, Glazer sold all of Zapata's Bolivian and oil and gas properties to Tesoro Bolivia Petroleum Company, thereby eliminating all links to the company's past. Next, in November, Glazer bolstered the company's commercial fishing operations by acquiring American Protein, Inc., which operated ten steamers and a menhaden processing plant in the Chesapeake Bay area, and Gulf Protein, Inc., owner of six steamers, five spotter planes, and processing equipment near Morgan City, Louisiana. Although at first it appeared Glazer might be shaping Zapata into a mighty commercial fishing operator, this was not the case. In April 1998 the company's fishing business, controlled through a wholly owned subsidiary named Omega Protein Corporation, was spun-off in an initial public offering of stock (IPO), with Zapata controlling 59.7 percent of the newly independent company's shares. Having distanced himself from Zapata's last remaining business, Glazer was ready to make his most important decision. His next move would determine the future course for Zapata.

Two weeks after completing Omega Protein's IPO, Glazer announced what type of business Zapata would enter. From April 27, 1998 forward, Zapata would compete in Internet and e-mail commerce business, its objective to acquire and consolidate companies involved with Internet and e-mail related ventures. Concurrent with the announcement, Zapata completed its first acquisition in its new industry, purchasing ICON CMT Corp., the owner of Word and Charged, two on-line World Wide Web magazines. In July 1998, Zapata increased its presence in its new business field by signing letters of intent to acquire or invest in 21 Internet sites and electronic-commerce businesses. Once the transactions were finalized, the company planned to integrate them into an Internet site located at www.zap.com, which was launched on July 6, 1998. Looking forward from this juncture in the company's history, Zapata's future course appeared clear as Glazer's son Avram, who served as president and chief executive officer, led the charge into Internet-related business. Zapata's goal, Avram Glazer explained, "is to become one of the largest Internet companies in world. We have the resources," he continued, "to make [the company's] strategy a reality and to lead the upcoming consolidation of this industry." With this ambitious objective, Zapata prepared for the 21st century, facing a future that would be entirely unlike its past.

Principal Subsidiaries: Zap, Inc.; Omega Protein Corporation (59.7%).

Related information about Zapata Corporation

Zapata Petroleum Corporation, an oil exploration company, was created by George H. Bush in 1953, along with his business partners John Overbey, and brothers Hugh and Bill Liedtke.

Early Business History, 1953-1966

Bush had been working for Neil Mallon, CEO of Dresser Industries (now merged with Halliburton) from when he graduated from Yale in 1948, to 1951. The initial $1 million investment for Zapata was split by the Liedtkes (and their circle of investors) and by Bush's father and uncle, Prescott Bush and Herbert Walker (and his family circle of friends). (He raised some startup money from Eugene Meyer, publisher of the Washington Post, and his son-in-law, Phillip Graham).tinyurl.com/z2mwghouston.bizjournals.com/houston/stories/1999/04/26/story2.html
Zapata Off-Shore accepted an offer from inventor R G LeTourneau for the development of a mobile but secure drilling rig. Zapata split in 1959 into Zapata Petroleum (headed by the Liedtke's) and Zapata Off-Shore (headed by Bush, funded with $800,000).bushlibrary.tamu.edu/research/find/Doncol1/bushpaps.html#Series:%20Zapata%20Oil%20Files,%201943-1983 Bush moved his offices and family that year from Midland, TX to Houston. Zapata Petroleum merged in 1963 with South Penn Oil to become Pennzoil.

Zapata Off-Shore concentrated its business in the Caribbean, the Gulf of Mexico, and the Central American coast in the late 1950s and early 1960s, according to Nicolas King's George Bush: A Biography. The US government began to auction off mineral rights to these areas in 1954. Drilling contracts in 1958 with the seven large US oil producers included wells 40 miles north of Isabela, Cuba (131 miles south of Miami), near the island Cay Sal. (Fidel Castro overthrew Cuba's Batista government in July 1959.) Zapata also won a contract with Kuwait. Bush was joined in Zapata by a fellow Yale Skull and Bones member, Robert Gow, in 1962.

By 1964, Zapata Off-Shore had a number of subsidiaries, including: Seacat-Zapata Offshore Company (Persia Gulf), Zapata de Mexico, Zapata International Corporation, Zapata Lining Corporation, Zavala Oil Company, Zapata Overseas Corporation, and a 41% share of Amata Gas Corporation.

In 1960, Jorge Diaz Serrano of Mexico was put in touch with Bush by Dresser. They created a new company, Perforaciones Marinas del Golfo, aka Permargo, in conjunction with Edwin Pauley of Pan American Petroleum, with whom Zapata had a previous offshore contract. Diaz later became head of Mexico's national oil company, Pemex, 1976-1981.

Bush ran for the US Senate in 1964 and lost; he continued as president of Zapata Off-Shore until 1966, when he sold his interest to his business partner, Robert Gow, and ran for US Congress. William Stamps Farish III, age 28, joined the board in 1966.

Zapata's filing records with the US Securities and Exchange Commission (SEC) are intact for the years 1955-1959, and again from 1967 onwards. The destruction of records occurred either in October 1983 (according to McHugh) or in 1981 shortly after Bush became Vice President of the United States (according to SEC record analyst Wison Carpenter).

Alleged connections with the CIA

Several conspiracy theories suggest that Zapata Off-Shore, and Bush in particular, cooperated with the CIA beginning in the late-1950s. Neither they nor coincidence theories (which deny this connection) offer proof. The strongest evidence may be two FBI memos, and close ties between Bush and Felix Rodriguez. Prescott Bush was a close business associate of CIA Director Allen Dulles and W. Averell Harriman since the 1930s. Dresser Industries, where GHW Bush worked 1948-1951, served as cover for a number of CIA officers. family friend Neil Mallon was CEO.

Averell Harriman was invited to join Skull and Bones in 1913, Prescott, Mallon, and Roland Harriman (also on Dresser's board) joined Skull and Bones in 1917. These three selected Robert A. Lovett (later Secretary of Defense and "father of the CIA") and F. His son, Endicott Peabody Davison, joined Skull & Bones in 1948 along with GHW Bush, and later became Bush's lawyer. GHW Bush worked for Mallon from 1948-1951, named his third son Neil Mallon Bush after Mallon, and wrote in his autobiography that Mallon "was a mentor second only to my father."

Several other Skull and Bones members (or relatives) helped with the CIA's Bay of Pigs operation. The CIA's Richard Dale Drain (Skull and Bones 1943) co-authored (with Jacob Easterline) a paper that proposed the Bay of Pigs invasion, "A Program of Covert Action against the Castro Regime," adopted by President Eisenhower on 17 March 1960. The White House's coordinator on the Bay of Pigs operation was McGeorge Bundy (Skull and Bones 1940), and his brother William P.

PBSUCCESS operation in Guatemala, including E. Howard Hunt, David Atlee Phillips, and Theodore (Ted) Shackley. Then, as station chief in Laos and Saigon, Shackley went on to direct the infamous Project Phoenix, where he was joined by Donald Gregg and Rodriguez.

Members of a tight-knit, wealthy group who owned property on tiny Jupiter Island in Hobe Sound, just north of Palm Beach and 90 minutes north of Miami, Florida, included: Harriman, Prescott Bush, G. Herbert Walker, Robert Lovett, Paul Mellon, Carl Tucker (whose son inducted Bush into Skull and Bones), C. GHW Bush reportedly travelled to Miami frequently on behalf of Zapata Off-Shore, c.1960-1962.citation needed

Two FBI Memos, November 22 and 23, 1963

Some direct evidence supporting the connection between Zapata Co and the CIA may come from two FBI memos regarding George Bush, in November 1963. The first memo names Zapata Off-Shore and was written by FBI Special Agent Graham Kitchel on 22 November 1963, regarding the assassination of JFK at 12:30 p.m. CST that day.

A second FBI memo, written by J.

When this second memo surfaced during the 1988 presidential campaign, GHW Bush spokespersons (including Stephen Hart) said Hoover's memo referred to another George Bush who worked for the CIA.www.apfn.org/apfn/jfk2.htm CIA spokeswoman Sharron Basso suggested it was referring to a George William Bush. It is possible, though it would be a remarkable coincidence, that a third "George Bush" worked for the CIA at that time, was important enough to be briefed by the FBI on 23 November 1963, and to be written up by Hoover, and yet was not correctly identified by the CIA's Basso.

In his book The Immaculate Deception: The Bush Crime Family Exposed (1991), US Army Brigadier General Russell Bowen wrote there was a cover-up of Zapata's CIA connections.

Bay of Pigs, boats

The CIA codename for the Bay of Pigs invasion of April 1961 was "Operation Zapata". is alleged to have come into contact with Felix Rodriguez, Barry Seal, Porter Goss (who served briefly as CIA Director under Bush Jr.), E. Howard Hunt, around the time of the Bay of Pigs operation.www.madcowprod.com/05072006.html John Loftus writes: "Zapata Off-Shore provided commercial supplies for one of Allen Dulles? (Leroy) Fletcher Prouty alleges in his book, The Secret Team (1973) and on his website, that Zapata Off-Shore provided or was used as cover for two of the ships used in the Bay of Pigs invasion: the Barbara J and Houston. Prouty claims he delivered two ships to an inactive Naval Base near Elizabeth City, North Carolina, for a CIA contact named George Bush, who re-named the boats.www.john-f-kennedy.net/thenixonbushconnectiontothekennedyassassination.htm (As a World War II Navy pilot, Bush had named his first Grumman TBF Avenger torpedo-bomber plane the Barbara after his wife, a second plane the Barbara II, and a third plane the Barbara III.)

The Bay of Pigs operation was directed out of the "Miami Station" (aka JM/WAVE), which was the CIA's largest station worldwide. He was replaced by career-CIA officer Theodore Shackley, who oversaw Operation Mongoose, Operation 40 (including Porter Goss, Felix Rodriguez, Barry Seal), and others. When Bush became Vice President in 1981, he appointed Donald Gregg as his National Security Advisor. Kevin Phillips' book: America Dynasty Kevin Phillips, in American Dynasty, discusses George Bush Sr.'s "highly likely" peripheral role in the Bay of Pigs fiasco. He points to the leadership role of Bush's fellow Skull and Bones alumni in organizing the operation. Edwin Pauley was "known for CIA connections," according to Phillips, it was Pauley who put Pemargo's Diaz and Bush together.

Phillips (and others) also point to the links between Zapata, the Bay of Pigs actors, and current and former CIA officials in the Watergate scandal. Nixon had appointed Bush as his United Nations Ambassador, a Cabinet-level position, in February 1971. At Bush's urging, his former Zapata partner, Bill Liedtke, was Texas' finance chairman for Nixon in 1968 and 1972. Liedtke passed the 'Mexican' donations to Maurice Stans of the Committee to Re-Elect the President (CREEP), who gave them to Watergate burglar G. Gordon Liddy, who gave them to Bernard Barker. (Barker was a Cuban-American associate of E. Howard Hunt from the Operation 40 and Bay of Pigs days.) Other Watergate "plumbers" ('to stop leaks') included Frank Sturgis, Eugenio Mart鱈nez, and Virgilio Gonz叩lez, all tied to the Bay of Pigs, and the CIA's James McCord and John Paisley. (Bush accepted the RNC Chairmanship on the highly unusual condition that he remain on as a Cabinet member.)

Phillips writes: "the CIA-Pemex-Pennzoil n辿e Zapata money line was... Howard Hunt, Frank Sturgis, Eugenio Mart鱈nez, Virgilio Gonz叩lez, and Bernard Barker?-had been involved in the abortive Bay of Pigs episode. Nixon and his senior advisers knew that the money had come through Mexican banks from 'the Texans ': regional Nixon finance chief William Liedtke co-founder of Zapata, Robert Mosbacher, and other Bush friends." Excerpts from Nixon's White House tapes from 23 June 1972 include the following conversation about money and receipts discovered on the Watergate burglars:

H.R. developed some films through this guy,
Benard Barker, and the films had pictures of
Democratic National Committee letterhead, documents .....
John Dean analyzed very carefully last night and
concludes, concurs now with Mitchell's
recommendation that the only way to solve this ... is for us
to have CIA Deputy Director Vernon Walters
call FBI Director Pat Gray and just say, "Stay the hell
out of this...this is ah, business here we don't want you to go
any further on it." He'll call Mark Felt
Deep Throat in, and the two of them; And it's got to be to [CIA Director
Richard] Helms and, ah, what's his name...? [CIA Deputy
Director] Walters.
Nixon: Walters.
Haldeman: And the proposal would be that Ehrlichman
and I call them in. How do you call him in, I
mean you just, well, we protected Helms from one hell of a
lot of things. Is it Liddy? And after their
interrogation of Colson, yesterday, they concluded it
was not the White House, but are now convinced it is a CIA
thing, so the CIA turn off would...
When you get in these people, say: "Look, the problem is
that this will open the whole, the whole Bay of Pigs thing,
and the President says ... that "they should call the FBI
in and say that we wish for the country, don't go any further
into this case", period!www.watergate.info/tapes/72-06-23_smoking-gun.shtml (Listen to audio of tape).
These ties seem to suggest a pattern of social relations and networking, with overlapping cast of characters from the CIA's Operation 40, Zapata, and Nixon.

Dealings with Ed Pauley

Zapata had a number of business dealings with oilman Edwin Pauley, including the Pemargo joint venture described above. He was so opposed to the 1960s anti-Vietnam war protests on campus that he secretly contacted his former-classmate, CIA Director John McCone, to request assistance. The FBI assisted Pauley in seeking the ouster of "ultra-liberal" regents, faculty members, and students, and even UC President Clark Kerr. The latter was not achieved until Ronald Reagan was elected Governor -- in part campaigning against campus protests. (For details, see entry on Edwin W. Pauley.)

GHW Bush becomes CIA Director

Many details of the Bay of Pigs emerged during the Church and Pike Committee hearings. President Ford, on Henry Kissinger's advice, replaced Colby in late 1975 with George H.

Officially, with no prior experience in the intelligence community, although then serving as US Ambassador to China, GHW Bush was appointed Director of the CIA by Ford and served 355 days, from January 30 1976-January 20, 1977. Twenty-one years later, after Bush's 8 years as Vice President and 4 years as President, the CIA Headquarters was re-named the "George Bush Center for Intelligence" in October 1998.

Zapata Off-Shore in Iran-Contra

CIA operative Felix Rodriguez had extensive contact with George Bush during the Iran-Contra affair. Indeed, in September 1986 General John K. Singlaub wrote Oliver North expressing concern about Felix Rodriguez's daily contact with the Bush office and warned of damage to President Reagan and the Republican Party.

Michael Mahony alleges that Zapata Off-Shore was used as part of a CIA drug-smuggling ring to pay for arming Nicaraguan Contras in 1986-1988, including Rodriguez, Eugene Hasenfus and others. (Note: Mahony's byline appears in anti-Semitic outlets.)

Summary of Criticisms

Skeptics suggest these are all coincidences or not reliable.

  • The fact that Bush's father Prescott, his mentor Mallon, his lawyer Endicott Peabody Davison, and other Skull and Bones classmates worked for or had close ties to the CIA does not prove anything.
  • There could have been a third "George Bush" who worked for the CIA in 1963 who was briefed by the FBI the day after JFK's assassination, the day after Zapata's GHW Bush of Zapata Off-Shore called the FBI, and who needed to be briefed -- during that busy day -- on anti-Castro Cuban sentiments;
  • Even if the Texas School Book Depository photo were Bush, it proves nothing about a connection to the CIA -- in fact, Zapata President Bush informed FBI's Kitchel he was heading to Dallas that day -- simply that "Bush" had enough prominence to be behind police lines. Tyler, TX is 105 miles from Dallas, a two-hour drive.
  • Skeptics note that the Bay of Pigs invasion landed at Zapata Peninsula, that there was no boat there named Zapata, and that Barbara Bush's maiden name, Pierce, begins with the letter "P," not "J". That various covert operations (Operation 40, Operation Mongoose, Alpha 66, perhaps the Bay of Pigs invasion) used the same islands off Cuba that Zapata did (Cay Sal), does not prove that Zapata Corporation (or GHW Bush) were involved.
  • That Bush became CIA Director with no prior experience in intelligence is somewhat surprising, but he was serving as US Ambassador to China at the time of US-Chinese normalization of ties, had previously been that head of the Republican Party, and before that was UN Ambassador.
  • That Bush was friendly with Felix Rodriguez in 1986-88 does not mean he knew him in 1961.
  • The CIA Headquarters was named by a partisan Congress, and in recognition of Bush's achievements as President and Vice President as well as his 355 days as CIA Director.








Business History 1969 to present, offshoots

Zapata, under Robert Gow's direction, acquired a controlling interest in the United Fruit Company in 1969. Robert's father, Ralph Gow, was on United Fruit's board of directors.

Gow apparently left Zapata in 1970. He took with him from Zapata Peter C. Ties to the Bush family continued-- in 1971 both Jeb Bush and George W. reportedly flew for Stratford to Florida and Guatemala (which suffered 400 death-squad murders that year).shr.aaas.org/guatemala/ciidh/qr/english/chap3.html Stratford evidently had ties to a large finca (nursery or plantation) in La Democracia, Huehuetenango, Guatemala.

In the 1970s, under chairman and CEO William Flynn, Zapata expanded its business to include subsidiaries in dredging, construction, coal mining, copper mining and fishing.

By the late 1970s, saddled with weak operations, high debt and low return on investment, the company again began undergoing changes in management and direction. Zapata Offshore became Zapata Corporation in 1982; its stock performed poorly.

By 1986 Zapata was one of the bad loans that shook the foundations of San Francisco-based Bank of America, with a debt of more than $500 million and a fiscal year loss of $250 million.

The company announced several restructurings during those years and managed to stave off bankruptcy more than once. The company had not had a profitable quarter in more than five years.

Zapata Offshore continued on as an offshore drilling company until the early 1990s when it was purchased by Arethusa Offshore which a few years sold the rigs to Diamond Offshore.

Still struggling with debt by 1993, Zapata signed a deal with Norex America to raise more than $100 million through a loan and stock sale. But financier Malcolm Glazer, owner of the Tampa Bay Buccaneers NFL franchise and then-owner of 40 percent of Zapata, didn't want his holdings diluted and filed a lawsuit to block the deal.

By 1994 the company had come under the control of Malcom Glazer, after a proxy fight. It no longer engaged in exploration, but owned several natural gas service companies. It also produced protein products from the menhaden fish. Between 1998 and 2000, Zapata tried to position itself as an internet media company under the "zap.com" name. The company's stock boomed and crashed along with other dot-coms, and in 2001 the company conducted a 1 for 10 reverse stock split. The venture was cited by many investment journalists as an example of a company jumping on the internet bandwagon without any relevant experience.

The Zapata Corporation serves as an investment vehicle for the Glazer family. Avram Glazer is the chairman and chief executive officer of Zapata.

Omega Protein Corporation, subsidiary


Zapata was a holding company for the Omega Protein Corporation, a marine protein business that processes the Atlantic menhaden into foods and industrial oils. Nonetheless, they annually kill and process over 233 million pounds of menhaden from the Chesapeake Bay. Critics claim that this level of fishing is threatening the ecological balance of the bay by removing a key plankton feeder that limits phytoplankton blooms such as red tide (Franklin, 2006).

References

More Factual

There is relatively broader agreement as to the factual reliability of the following sources:

  • Zapata Offshore Annual Reports, Microform Reading Room, Library of Congress.
  • Kevin Philips, Dynasty: Aristocracy, Fortune and the Politics of Deceit in the House of Bush, (2004), esp.
  • Joseph McBride, "The Man Who Wasn't There: 'George Bush,' CIA Operative," The Nation, July 16/23, 1988, p.
  • David Atlee Phillips (CIA, autobiography), The Night Watch.
  • E.
  • National Security Archives documentation of GHW Bush's CIA involvement in the early 1960s.
  • United States District Court for the District of Columbia, Civil Action 88-2600 GHR, Archives and Research Center v. 89 refers to "Operation Zapata" as the codename for the Bay of Pigs operation.
  • Nicolas King, George Bush: A Biography.
  • "Adios, Zapata! Bruce, "Net Losses", Mother Jones, March 2006 - extensive article on role of Menhaded in ecosystem and possible results of overfishing. Retrieved 21 February, 2006

More Opinionated

There is less agreement on the reliability of the following sources on Zapata (in terms of factual errors and/or point-of-view biases and interpretations):

  • Webster Tarpley & Anton Chaitkin, George Bush: The Unauthorized Biography, Chapter 8.2 (1991), and "Bush as a covert CIA operative during the early 1960s". Tarpey and Chaitkin are associated with Lyndon LaRouche.
  • Laura Hanning 2004, Study of Evil -- A World Reappraised: supporting documents, photos, letters, part III George Herbert Walker Bush
  • Anthony L. Kimery, "George Bush and the CIA: In the Company of Friends," Covert Action Quarterly, Summer, 1992.
  • Leroy Fletcher Prouty, The Secret Team (1973).
  • Michael Maholy (of Yankton, SD), www.phoenixarchives.com/contact/1994/1294/122794.pdfwww.phoenixarchives.com/contact/1996/0396/032696.pdf, but careful, Maholy's byline appears in anti-Semitic outlets. E.g., here.

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