Wasserstein's death

Δημοσιεύθηκε: 15 Οκτωβρίου 2009 - 15:10

One of the quickest guns in the wild west of Wall Street deal making, the passing of Bruce Wasserstein, chief executive of merger and acquisition advisor Lazard, severs a link between 1980s old school deal making and modern finance. Few bankers can claim to have invented strategies such as the "Pac-man defence", where a takeover target tries to buy out its acquirer, or have a book written about a deal they championed; in his case, the $31.4bn buyout of RJR Nabisco. Fewer still would have had his daring in attempting to force out chairman Michel David-Weill, a descendent of the company's founders.

Whether Wasserstein's deals were any more successful from the point of view of the bidder at creating value than the dismal industry average, however, is unclear. He was lucky that his career coincided with the massive growth in M&A and the importance of its role in the global economy. The number of US M&A deals doubled between 1970 and 1985 to about 700 per quarter according to the US National bureau for economic research. Over the same period of time, US gross domestic product only rose by two thirds. Between 2001, when Wasserstein joined Lazard, and the beginning of the credit crunch, global M&A value rose 2.5 times according to Dealogic whereas global GDP only picked up by a fifth. Mirroring the globalisation of the market for corporate control, he took the bank public in 2005, two years later signing an agreement with advisors Raiffeisen Investment to enter into central and eastern Europe.

Predictably, Lazard's share price fell 4 per cent to $41.60 in early trading, after being already depressed on news that Wasserstein was unwell, but the Lazard ship will continue to sail and Kraft will still bid for Cadbury, perhaps though without the same gloss. "Bid 'em up Steve" doesn't quite have the same ring as "Bid 'em up Bruce", but then times have changed, too. And just as Wasserstein and his larger than life peers forged their identities in the 1980s, the current financial crisis may just be creating a new generation of battle hardened creative bankers. Only time will decide whether they have the same impact on Wall Street.

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