Dealings: A Political and Financial Life - Hardcover

Rohatyn, Felix G.

 
9781439181966: Dealings: A Political and Financial Life
Hardcover
ISBN 10: 1439181969 ISBN 13: 9781439181966
Verlag: Simon & Schuster, 2010

Inhaltsangabe

It was a German soldier’s chance decision to reach for a cigarette and absently wave a car through a checkpoint outside Marseille in 1940 that allowed Felix Rohatyn and his Jewish family to escape from Nazi-occupied France. In the States, a chance summer job led him to the small, private investment bank of Lazard Frères, where he came under the tutelage of legendary financier André Meyer. The summer job turned into an extraordinary fifty-year career.

Hailed as "the preeminent investment banker of his generation," Rohatyn was a creator of the merger-and-acquisition business that revolutionized investment banking and transformed the worlds of finance and entertainment. In this very personal account, Rohatyn takes us behind the headlines to offer readers a telling look at some of the era’s most renowned figures in the worlds of finance, entertainment, and politics. We are alongside Rohatyn as he meets Steve Ross in the back of the funeral parlor Ross is managing as they strategize to take control of Warner Brothers, and in André Meyer’s art-filled apartment as they negotiate with Frank Sinatra.

We are with Rohatyn as he assists Harold Geneen of ITT weather a series of congressional investigations, and as he stays one step ahead of the canny Michael Ovitz as Matsushita attempts to win control of Lew Wasserman’s Universal Pictures. We also watch Rohatyn defending shareholders’ interests as the RJR-Nabisco buyout becomes a cautionary tale of executive greed.

We have a front-row seat as Rohatyn and Governor Hugh Carey forge a desperation plan to save New York City from bankruptcy. And we accompany Rohatyn when he returns to Paris as the U.S. ambassador to the country he barely escaped alive as a young boy.

Full of headline-making revelations, insider stories, keen personal observations, and relevant financial wisdoms, Dealings is the page-turning story of a life well lived.

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Über die Autorin bzw. den Autor

Felix Rohatyn is Special Advisor to the Chairman and CEO of the investment banking firm Lazard Freres & Co. LLC. A frequent contributor to The New York Review of Books, he was a managing director at Lazard for many years, chairman of the Municipal Assistance Corporation of the State of New York from 1973 to 1992, and U.S. ambassador to France from 1997 to 2000. The author of Bold Endeavors: How Our Government Built America, and Why It Must Rebuild Now, he lives in New York with his wife, Elizabeth.

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Eighteen

The insistent ringing of the phone late at night is always disconcerting. It is a noise that immediately fills me with dread: someone is reaching out to me in the darkness with bad news. So it was with a measure of anxiety that, late one night in November 1987, I turned on the lamp on our bedroom table, leaned over toward the trilling phone, and picked up the receiver.

I was relieved to discover that the caller was my partner, Ira Harris. A gigantic man with an explosive temperament, Ira had dominated the investment banking business in Chicago as the resident partner of Salomon Brothers until I had succeeded in luring him to Lazard. The lateness of the hour, I knew, meant little to Ira; he was always doing business. I prepared myself for a report on some recent development that was too important to wait until morning.

“I’ve just spoken to Ross Johnson,” he announced without even a pretense of an apology for the lateness of his call. “They want to meet us tomorrow for lunch in Atlanta.”

I knew, of course, that Ross Johnson was the CEO of RJR Nabisco, the company that had been formed by the merger of R.J. Reynolds Tobacco, the world’s second-largest cigarette manufacturer, and Nabisco, a major international grocery products company. But Johnson was neither a business nor a social acquaintance. And I was tired.

“Listen,” I said with perhaps too much abruptness, “I don’t know him or his company. Do you really want me to do this?”

“Absolutely,” Ira nearly shouted. “The management wants to do an LBO. They want us and Dillon Read to advise the board. Can you meet me there?”

I just wanted to go back to sleep. “Ira—” I started.

“Let me know what flight you’re on,” he interrupted. “I’ll have you picked up in Atlanta.” Without waiting for me to respond, he hung up.

And so with that call I became one of the initial participants in a complex and hard-fought deal that would be the largest LBO ever. It would involve a crowd of Wall Street’s most renowned bankers, lawyers, and public relations specialists. It was also a transaction that would, notoriously, symbolize the extravagant greed that energized and shaped the financial marketplace in the 1980s. And by the time it was concluded, I would almost be regretting that I had ever reached across my bed to answer the phone that late November night.

RJR Nabisco had lavish headquarters—a sprawling campus of enormous buildings gleaming like what seemed to be acres of polished marble. It had all been designed, I suspected, with the purpose of impressing visitors, and as I arrived at the meeting the next day I must admit that all the extravagance had the desired effect. I was impressed. Clearly, this was a very rich company, a conglomerate that had its own fleet of airplanes and sponsored golf and tennis tournaments with millions of dollars in prize money. But my banker’s mind couldn’t help wondering, How rich? On the plane ride down to Atlanta, I had worked out that at its present price of $55 a share, RJR was valued at about $16 billion. Yet not very long ago the stock had been trading at $76. The real market value price per share, I felt certain without even doing any due diligence, would be significantly higher. For the right price, the purchase of RJR Nabisco would be a very good investment. No wonder the Johnson group wanted to make a deal.

No sooner had I arrived at the headquarters then I was led into a meeting room. Charles Hugel, the chairman of RJR’s executive committee, was sitting at the head of a long table. To his right, I recognized Peter Atkins, who was a senior partner at Skadden Arps, Meagher & Flom, and one of the profession’s leading M&A lawyers. He was, I was told, acting as counsel to the executive committee. Ira and our colleagues from Dillion Read were also already seated.

Once I joined them, the meeting moved forward with surprising quickness. Hugel explained that the management of RJR, led by Ross Johnson, planned to propose an LBO of the company to the board of directors. The price was set at $75 a share, and Shearson Lehman Hutton, the investment bank advising the management, was confident that the financing could be arranged. A committee of independent directors, headed by Hugel, had been formed to review the fairness of this proposal. Lazard and Dillion Read would be the financial advisers to this special committee of the board; we would, assisted by Peter Atkins’s legal advice, represent the shareholders’s concerns.

Management, Hugel continued, was operating on a very tight timetable. But these top executives believed that the entire transaction could be swiftly concluded. After all, he pointed out, they were offering a premium of almost 40 percent over the current $55 share price. Of course, he concluded, there was undoubtedly some room for improving this initial bid. But there was every reason to believe that the special committee should be able to come to a prompt decision that was in the shareholders’ best interest. Two weeks, he suggested breezily, and the deal should, largely, be concluded.

I listened to Hugel and grew increasingly uncomfortable as he spoke. This would be one of the largest corporate transactions in the history of American business; certainly, it would be the biggest LBO. It was a deal in which management presumably would reap huge profits: a situation, I knew from past experience, that inevitably led to lawsuits from shareholders. In addition, a deal of this size involving a company whose products were household names would also attract the attention and scrutiny of the press. My every instinct was to be deliberate. Hugel’s recitation struck me as too confident, too matter-of-fact. And the emphasis on speed made me extremely uneasy.

After conferring with Ira and the bankers from Dillon Read, I spoke. We would, I said, get to work immediately; a joint team was ready to begin doing due diligence. But, I emphasized, we would not guarantee that this process could be finished in the two weeks that had been suggested. Our responsibility was to see that the shareholders received the best price. Therefore, a thorough evaluation of the company and its components had to be done. And, since this was a transaction involving a potential purchase by insiders, we needed to provide sufficient opportunity for other bidders to step forward. Two weeks, I reiterated, was simply too little time.

Hugel seemed undisturbed by my reservations about his timetable. He just plowed on, showing us the press release describing management’s purchase offer. It would be released immediately following the scheduled meeting later that day of the entire board. Then, he led us into the boardroom to meet with the special committee.

The boardroom, like everything at RJR, was gigantic. Seated around a table that looked nearly as long as the flight deck of an aircraft carrier were the members of the special committee. I had met many of these directors before. Martin Davis, chairman of Paramount, was a client of Ira’s and mine; I knew him to be a tough, demanding, and difficult man. Bill Anderson, chairman of NCR; and John Macomber, chairman of Celanese, were close acquaintances of mine. Vernon Jordan was (and still is) everyone’s friend and counselor. Juanita Kreps, the only woman on the committee, had been secretary of commerce in the Carter administration. John Medlin was chairman of Wachovia Bank. This was a sophisticated group; and I was buoyed by the certainty that no matter what pressures were put on us by management and Charlie Hugel, the committee members would not be intimidated. They would insist on an open and fair bidding...

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Verlag
Simon & Schuster
Erscheinungsdatum
2010
Sprache
Englisch
ISBN 10 
1439181969
ISBN 13 
9781439181966
Einband
Gebundene Ausgabe
Anzahl der Seiten
304
Kontakt zum Hersteller
Nicht verfügbar
Verantwortliche Person
Nicht verfügbar

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