Bruce Wasserstein

Sometime after leaving the Cravath law firm to join First Boston in 1977 and before co-founding Wasserstein Perella in 1988, Bruce Wasserstein moved from being a phenomenal investment banker to an investment banking legend. If I had to place the time of the transformation, I would choose 1981. It was when Bruce advised DuPont on the takeover of Conoco, which at that time was the largest takeover in corporate history. Conoco was a classic case of the complexity and tactical maneuvering that were features of the takeover battles that caught the attention of the Nation for most of the decade of the 80’s. First having been attacked by Dome Petroleum, then having negotiated a merger with Cities Service, Conoco was again attacked, this time by Seagrams, just as it was about to sign a merger agreement with Cities Service. In desperation, Conoco turned to DuPont to rescue it. Bruce structured a deal that outmaneuvered Seagrams, was successful despite a higher offer from Mobil, and resulted in DuPont acquiring all of Conoco. The investment banking world recognized that DuPont’s success was the result of the brilliant strategy and tactics of Bruce Wasserstein. The legend was born.

I recount the DuPont-Conoco deal not just to mark the beginning of the legend, but to introduce Bruce’s philosophy of investment banking and mergers and acquisitions. When a few years ago he was asked what makes a great banker, Bruce re-plied:

• 1. First and foremost personal integrity —unless you have the trust of the people you advise and the people you deal with, you cannot succeed over the long run.
• 2. Then Bruce said, judgment is the second most important attribute — not brilliance, but judgment, judgment to bring to bear intelligence, experience and personality in deciding on how best to deal with a situation.
• 3. Next was salesmanship — the ability to persuade others to accept your advice.
• 4. Then he said being a good tactician in structuring transactions and negoti-ating with the parties on the other side.
• 5. Enthusiasm for the business was Bruce’s next point. A great investment banker likes advising people and likes outmaneuvering people on the other side and, most of all, likes winning.
• 6. The last point was particularly applicable to the hostile takeover battles at which Bruce excelled — helping people at a point of crisis and the thrill of bringing them through the crisis successfully.

Obviously, I have embellished Bruce’s actual answers, which were given in his usual staccato fashion, because to me, as I have rephrased them, they personify Bruce. He had each of those qualities plus a great liking and respect for the people he worked with and the people he worked against.

I thought I might further illuminate Bruce’s career with a few personal reminiscences. The first was right after Bruce joined First Boston. I received a call from Joe Perella telling me he had talked a brilliant young Cravath lawyer into joining him in his effort to establish an M&A department and that I had to meet this young lawyer because he was really outstanding. Not long after that I did meet Bruce. I did think he was really outstanding. I did think he would be a great success. I did like him. And I was fortunate that it started a 32 year friendship with Bruce.

In 1988, I was sitting in my office just across the street from Bruce and Joe at First Boston when I got a call from Bruce that they had just resigned from First Boston and they needed a home. I called my partner, Jim Fogelson, who worked closely with Bruce and Joe, and we offered our office, little realizing that most of the First Boston M&A department would be there in five minutes. It was at the very height of the 1980s M&A boom and within an hour of their arrival they had taken over all of our conference rooms, half of our offices and all our food. A few minutes later our telephone system also fell to the invasion. It got overloaded, and we couldn’t make calls. Never have I seen more frenetic activity as Bruce and his colleagues carried on their day and night deal-doing. Fortunately, it didn’t take too long before they were ensconced in their own quarters. Interestingly, when Wasserstein Perella was born, Bruce said that his ambition for the new firm was to build ‘the Lazard of the 1990’s.

Wasserstein Perella was a great success from the start. In addition to the outstanding team that joined Bruce and Joe at the beginning, over the next dozen years many of the M&A stars of the time joined Wasserstein Perella, and many of the young people who started their careers at the firm became today’s stars.

Then in 2001, Bruce negotiated a merger with Dresdner Bank that was very beneficial to the Wasserstein Perella partners and Wasserstein Perella became Dresdner Kleinwort Wasserstein. Unfortunately, the culture of a German universal bank and the collegiality of Wasserstein Perella did not marry well and Bruce resigned, as did most of his former colleagues not too long thereafter. But, Bruce was soon back in action.

In 2002 Bruce joined Lazard Freres, the firm that had been courting him for two decades and assumed the leadership management role. This was the right combination. Bruce’s former colleagues and other of the best and brightest of the investment banking world joined with him and with the outstanding bankers of the long-established Lazard. Bruce rejuvenated Lazard and took it to new successes. Such was the extent of that success that three years later Bruce and his colleagues, new and old, were able to restructure Lazard and turn it into a public company. Bruce became Chairman and CEO. Lazard continued to nurture and attract great bankers and embarked on a four-year journey that saw one success after another, and a unique avoidance of the pitfalls of the Wall Street collapse and the global financial crisis. A year after Lazard became a public company, I was quoted in a Business Week Magazine portrait of Bruce saying that, “It unquestionably was his greatest deal.” Indeed it was.

At my last lunch with Bruce, a few months before his death, as usual we had a wide ranging discussion of the economy and world affairs in general. And, as usual, each time we touched on a subject of interest to Bruce, he would say in that special way he had, “It’s Interesting” and then proceed to state his contrary or different views. Over the years it got so that I would try to anticipate when I would hear, “It’s Interesting.” And it never failed to be interesting even when we had very different views. Lazard gave Bruce an opportunity to see the world on a global scale. He was fascinated with questions such as how do you deal with outsourcing; how do you reindustrialize America; how do you train people to cope with the global economy; how do you recalibrate the role of workers in “at risk” companies; how do you prepare for the patterns of change; how do you adapt to increasingly rapid technological change? Bruce viewed his role as an investment banker as requiring him to anticipate necessary change and to be a catalyst for making an efficient economic system, both in the United States and globally. Bruce was someone who truly cared about the future of the world and he had the ability to do something about it.

Bruce was scheduled to join me in Cambridge on October 16 for a program on cross border mergers and acquisitions sponsored by the business schools of Cambridge University, Peking University and New York University. I was in London that week before leaving for Cambridge when I got a call from Pam telling me about his being taken to the hospital and then a few days later, of his death. The dinner before the Cambridge program turned out to be a memorial service and tribute to Bruce. As a graduate of Cambridge, and an advisor to its business school, Bruce was well known in the Cambridge community. So, too, all the other participants in the program — leading investment bankers, lawyers, and business people from England, France, Germany, Spain, Italy, Russia, China, India, Australia and the U.S. They all knew Bruce. All were shocked by his untimely death, and all remarked that a legend had died. At the Cambridge dinner I spoke of Bruce and I asked Eric Gleacher, another of the great investment bankers and Bruce’s contemporary and friend, to talk about his relationship with Bruce and Bruce’s position in the investment banking world. Eric was eloquent and the several hundred people present were moved, some even to tears. Many of the things Eric and I said then, I’ve said here, but I would like to stress one — Bruce was a consummate gentleman, a man of his word whose handshake was the same as a written agreement. Bruce Wasserstein died on October 14, 2009. But his legend lives and will continue to live.