- Banker to Receive $135 Million [Wachovia Vice Chairman Wallace Malone]
- Alan Greenspan in Play? Headhunters Can Dream
- Trump Says ‘Times’man Missed Billions Because of Blonde
- Banker’s Batty Request to Yanks [Morgan Stanley Chief Technology Officer Guy Chiarello]
- VSS is Quitting Advisory [Veronis Suhler Stevenson]
- Prince called Arabian Buffett – Globe and Mail
- Ad World Yapping Over WPP Dealings
- Bagging Fakers and Sellers; Makers of Luxury Goods Try New Legal Tactics Against Those Who Aid Counterfeiters
- Scudder Funds to Get New Name – Brand to Reflect DWS Role; Shareholders Will Weigh Host of Structural Changes
- The ultimate epitaph
Banker to Receive $135 Million Parachute – New York Times
Wallace D. Malone Jr., who became Wachovia’s vice chairman just 15 months ago after selling it SouthTrust Bank, will receive a golden parachute worth about $135 million when he steps down from the company today.
The bulk of those retirement benefits were awarded to Mr. Malone, who is 69, during his long tenure as chief executive of SouthTrust, but were accepted by Wachovia’s board as part of its $14 billion acquisition in November 2004.
The retirement benefits come on top of the $473 million worth of Wachovia stock he now holds from the sale of SouthTrust, including a $10 million stock grant last year.
The lush payday underscores two trends in executive compensation that have lately come under fire: the tendency to shower rich payouts on retiring executives, as in the case of Philip J. Purcell of Morgan Stanley or John F. Welch Jr. of General Electric, or on executives of companies that are taken over.
For example, James M. Kilts, who ran Gillette for four years, became eligible for a $175 million payday when the company was taken over by Procter & Gamble. (Mr. Kilts is on The New York Times Company board.)
Corporate governance advocates say that Mr. Malone’s case highlights the need for greater scrutiny and disclosure at the time a merger is approved, not just when an executive walks out the door. Indeed, the Securities and Exchange Commission has just proposed 370 pages of new rules to improve the disclosure of executive pay.
Alan Greenspan in Play? Headhunters Can Dream . . . – Wall Street Journal
TO: Corporate Recruiters
RE: Alan Greenspan’s availability
After 18 years heading the Federal Reserve Board, the nation’s central bank, Alan Greenspan is preparing to step down tonight. With his stellar credentials and masterful grasp of the economy, Mr. Greenspan looks like an attractive catch for a corporation — as a director, perhaps, or in any capacity that might interest him. His celebrity status would be a feather in a company’s cap, whatever the role he might play. Mr. Greenspan served on many corporate boards before joining the Fed, including General Foods, J.P. Morgan, Mobil Corp. and Aluminum Co. of America.
Alan Greenspan will more than likely be a sought-after and richly paid speaker.
But landing him as a board member for your public-company clients won’t be easy. Mr. Greenspan has signaled that he plans to set up a consulting firm, Greenspan Associates, in Washington, D.C. He also plans to write a book and give speeches. But he has "no interest in rejoining corporate boards" once he leaves the Fed, said one person close to the situation.He probably won’t need the money from a board seat: Mr. Greenspan intends to sign up with the Washington Speakers Bureau and command as much as $150,000 per speech, the Financial Times reported earlier this month. A spokesman for the Alexandria, Va., bureau wasn’t immediately available to comment. But a per-speech fee of "$150,000 isn’t high" for someone like Mr. Greenspan, says Michael MacFarlane, vice president of Walters International Speakers Bureau in Los Angeles.
Trump Says ‘Times’man Missed Billions Because of Blonde – New York Magazine
Donald Trump may have perfected the art of self-promotion, but he’s also showing an over-the-top knack for getting even. Last week, he filed a libel lawsuit seeking a minimum of $5 billion in damages resulting from Times business writer and TrumpNation author Timothy O’Brien’s “malicious” lowballing of Trump’s net worth. Buried in the legal complaint, which Trump personally edited and peppered with self-congratulatory phrases, Trump accuses the writer of wasting his research time flirting with one of Trump’s in-house lawyers, a dirty-blonde Atlanta native named Michelle Scarbrough. “[O’Brien] was highly inappropriate,” says Scarbrough, who’s appeared on The Apprentice. Scarbrough says O’Brien was acting “way too casual” and invited her to his New Jersey home for dinner. O’Brien believes Trump is using Scarbrough as a mechanism to smear his reputation. “Donald’s always full of surprises,” O’Brien writes in an e-mail. “That’s what makes him so interesting.”
Banker’s Batty Request to Yanks – New York Post
A top Morgan Stanley exec tried to make a squeeze play on a potential client to score his dream job – as a batboy for the Yankees, or even a groundskeeper so he could frolic to the Village People’s "YMCA."
In stunning e-mails obtained by The Post, Morgan Stanley Chief Technology Officer Guy Chiarello pestered Robert Nederlander Jr., whose father is a part-owner of the team, to allow him to be on the grounds at Yankee Sta- dium in honor of his 20th anniversary with the powerhouse firm.
"Whether it is as [an] honorary bat [boy], sitting down at the foul line for an inning to catch balls, or even [working with] the grounds crew during the 5th inning of a game to the tune of YMCA!" the middle-aged Chiarello excitedly wrote in February 2004.
In return, Chiarello, who controls a massive purchasing budget with more than 2,000 employees, promised that he could generate a lot of "interest" from his 1,500 New York employees for the Yankees – implying that "a bunch of them" would buy tickets or "would be willing to make a charitable donation on behalf of the [team]."….
VSS is Quitting Advisory – New York Post
Veronis Suhler Stevenson, one of the first media-focused investment banking boutiques, is winding down its advisory business to focus exclusively on leveraged buyouts, The Post has learned.
The New York investment firm, which was started in 1981 by Psychology Today founder John Veronis and former CBS Inc. president John Suhler, is planning to exit the investment-banking business in the next six months after wrapping up a handful of assignments, sources close to the firm said.
The move follows other investment firms that have either shed their private-equity arms or shut down their investment banking divisions in order to avoid potential conflicts with their clients.
"At the end of the day, I think this is another example of a firm that did not want to compete with their [investment banking] clients," said the head of one private-equity firm….
Prince called Arabian Buffett – Globe and Mail
When Saudi Prince al-Waleed bin Talal toured the newly renovated Four Seasons des Bergues hotel in Geneva last fall with Isadore Sharp before it reopened, he observed that the blue hue of one of the meeting rooms was a bit strong.
“He was really concerned about the aesthetics,” recalled Mr. Sharp, chief executive officer and controlling shareholder of Toronto-based Four Seasons Hotels Inc. “It was modified slightly — the paint colour — but it wasn’t anything serious,” said Mr. Sharp, adding that the prince also happened to own 50 per cent of that hotel.
Mr. Sharp meets with Prince al-Waleed a couple of times a year on business and pleasure, and described his partner as a hands-off investor when it comes to hotel operations, and one who lets management take over. “He’s an ideal partner,” he said of the man Forbes magazine ranks as the fifth-richest man in the world. Mr. Sharp first met him on the prince’s yacht near Cannes in 1994 just before the Saudi businessman took a 22-per-cent stake in what has become the world’s luxury hotel chain.
With Monday’s announcement that the prince has become a partner with U.S.-based Colony Capital LLC to buy Toronto-based Fairmont Hotels & Resorts Inc., the Saudi businessman has now boosted his presence substantially in Canada’s hotel industry….
Time magazine has called him the Arabian Warren Buffett, referring to the U.S. investment guru.
One of the best examples of the prince’s astute investments has been his purchase of a stake in Citigroup Inc. in 1990 when the bank’s shares plunged amid fears it might fail. The prince also holds interests in a plethora of other companies, including News Corp., Time Warner Inc., Motorola Inc., Apple Computer Inc., Canary Wharf and Saks Inc.
Prince al-Waleed invests in companies that he believes have qualified management, and is there to support the investment, such as by owning individual properties in the hotel industry, Mr. Sharp said.
For example, the prince last year bought the Four Seasons Hotel in Toronto’s trendy Yorkville district and is also the major investor in a second nearby Four Seasons hotel to open by 2009 in an attempt to keep to keep the brand alive and well in the city’s competitive luxury hotel market….
Ad World Yapping Over WPP Dealings – New York Post
Ad giant WPP is investigating questionable financial dealings involving its former top executive in Italy, who was fired after clashing with Chief Executive Martin Sorrell.
WPP has called in a team of lawyers and accountants to investigate its media-buying businesses in Italy amid allegations regarding its former head there.
The probe could prove embarrassing for WPP, which owns Madison Avenue giants Ogilvy & Mather and JWT, and its hard-charging CEO, whose personal involvement in the situation has set tongues wagging in the ad industry.
A WPP spokesman said the company fired long-time executive Marco Benatti on Jan. 9. Benatti did not return a call to his office at Fullsix, a marketing venture affiliated with WPP.
The internal investigation focuses on potential conflicts of interest between companies Benatti either owned or held interests in, and his role as an executive and consultant to WPP, sources told The Post….
Bagging Fakers and Sellers; Makers of Luxury Goods Try New Legal Tactics Against Those Who Aid Counterfeiters – Wall Street Journal
Women trolling New York City’s Canal Street for trendy Louis Vuitton totes are getting a wake-up call: big signs warning that the bags could be fakes, but the punishments for selling them are very real.
"This retailer is not authorized or licensed to sell Louis Vuitton merchandise," the signs read. "Counterfeiting is criminally and civilly punishable under federal and state law by up to 10 years of imprisonment and $2,000,000 in fines." While the penalties apply to sellers, the aim is to scare shoppers as well.
The posters are part of a new effort by luxury-goods companies like LVMH Moët Hennessy Louis Vuitton SA, owner of the Vuitton brand, to counter the rampant global trade in counterfeit luxury goods. The companies are fighting back with a new arsenal of legal tactics. In addition to targeting manufacturers and sellers of fakes, they are turning their attention to landlords, shipping companies, credit-card companies and any other part of the supply chain that leads to the sale of counterfeit wares.
Louis Vuitton is cracking down on shops on New York’s Canal Street selling fake goods.
"The idea is that if you’re making money out of this business, we’re going to sue you," says Nathalie Moullé-Berteaux, intellectual-property director at LVMH’s fashion group.In legal terms, the concept is called "vicarious" and "contributory" liability. It targets people aiding and abetting someone committing a crime even if they are engaging in a legitimate transaction, such as renting out a property or shipping a package.
In a legal settlement in New York last week, landlords for seven Canal Street properties promised to prevent tenants from selling handbags with counterfeit Louis Vuitton logos. The landlords agreed to hang signs inside and outside their shops warning that the retailers aren’t authorized vendors of Louis Vuitton products. They also promised to evict tenants found selling fakes….
Scudder Funds to Get New Name – Brand to Reflect DWS Role; Shareholders Will Weigh Host of Structural Changes – Wall Street Journal
The Scudder Funds has asked shareholders to approve a raft of structural changes in some of its mutual funds and has announced that it will remove the well-known Scudder name from them.
Among the proposed changes are a new fee structure, new advisory agreements for the funds, consolidation of the boards that oversee them, and some fund mergers. They are outlined in filings Scudder made with the Securities and Exchange Commission that cover the Scudder Mutual Funds Inc., the Scudder Pathway Series, Scudder Portfolio Trust, Scudder Funds Trust, Scudder Securities Trust and Scudder Income Trust, among others.
The repositioned funds will operate under the name DWS Funds, and be managed by DWS Scudder, echoing the fact that they bear the DWS moniker in Europe. The Scudder Income Trust, for example, will be known as the DWS Income Trust; the Scudder Mutual Funds as the DWS Mutual Funds; and the Scudder Pathway Series as the DWS Pathway Series, according to the filing. The name changes were recommended by Deutsche Investment Management Americas Inc., the funds’ adviser, and approved by the funds’ board, and don’t require shareholder approval.
However, Scudder must get shareholder approval for the host of other changes it wants to make.
"This proxy may look complicated, but it represents an effort to simplify your fund’s governance system, fee and expense structure, governing documents and investment policies," Scudder board members including chairwoman Dawn-Marie Driscoll wrote to shareholders. "It is the result of a long-term study and many meetings by your fund’s board to consider these proposals."….
The ultimate epitaph – Financial Times
It must be easy for investment bankers to get jaded about trophies. There are only so many engraved acrylic merger mementoes that can fit on their desks, after all.
Deutsche Bank’s team must, nevertheless, be delighted to have won the mandate to sell Lucite International, the company that owns the patent for the eponymous and ubiquitous acrylic used to make the tiny tombstones.
The comparatively small amount of plastic that ends on bankers’ bookshelves is not significant enough to feature in Deutsche’s letter to potential buyers, but the document does make clear that Lucite products offer outstanding durability – which is more than can be said for some of the deals they commemorate.
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