Philip Rinaldi, the city's refinery titan, offered Philadelphia City Council a lesson in business terminology Friday when he introduced a new phrase into council's vocabulary: "idiot insurance."
During testimony on whether the city-owned Philadelphia Gas Works should engage in a public-private partnership, Rinaldi suggested Council could consider protecting its interests by maintaining an ownership stake in any private venture.
"I live in a world of mergers and acquisitions," said Rinaldi, chief executive of Philadelphia Energy Solutions. "We have a slightly rude saying sometimes for - let's see how I can make this sound right - idiot insurance, or something like that."
Rinaldi explained that sometimes in deal-making, a buyer needs to offer an uncertain seller an ongoing interest in a project so that the seller is assured of not being taken to the cleaners. Rinaldi said his company used a similar approach in 2012 when it acquired Sunoco Inc.'s refining complex in South Philadelphia. Sunoco retained a one-third interest in the refinery joint venture.
Councilman Kenyatta Johnson, whose district includes the refinery, was intrigued. "Did you call it idiot insurance?" he said.
"When we're not on the microphone, I'll tell you the real word," Rinaldi said.