Anyone looking at the mergers and acquisitions "league tables" - the Wall Street equivalent of Major League Baseball's standings - during this hot year for merger activity would find the usual suspects: Morgan Stanley and Goldman Sachs vying for the top spot, with other big brand-name firms jockeying to fill the coveted top 10.
And then, at No. 11, there's Paul J Taubman.
Paul who?
Taubman isn't exactly a household name outside the limited precincts of investment banking. But at this rate he may become one, despite his personal modesty and long aversion to publicity. Investment bankers told me they couldn't recall another time when an individual occupied a slot this high on the league tables. (He was also No. 11 for all of 2013.) Taubman has single-handedly accounted for $175 billion in deals over the last year, which has had Wall Street bankers buzzing with a mix of admiration and envy.
Although Taubman's feat is unusual, he may be part of a fledging trend toward merger and acquisition microfirms, or, as in his case, sole practitioners. Two brothers, Michael and Yoël Zaoui are advising the French cement maker Lafarge in its $60-billion merger with another giant cement maker, Holcim, of Switzerland. Robertson Robey Associates, a microfirm that was known as "the three Simons" - Simon Robey, Simon Warshaw and Simon Robertson - until one of them broke off, advised Grupo Corporativo Ono of Spain in its $10 billion acquisition by Vodafone in March. (Robertson recently split off to form his own operation, and his former partners formed Robey Warshaw.)
Bankers have already coined a new catchword for such small firms: "kiosks," as opposed to the somewhat larger "boutiques," like Moelis & Company founded by Kenneth D Moelis, which went public this week.
Such arrangements can be fabulously lucrative, since kiosks have little or no overhead but are still paid as a percentage of the total cost of a successful deal. Clients receive the benefit of the undiluted attention of a top merger and acquisition strategist. Still, such tiny firms have their limits. "I'm just one person," Taubman told me when I visited him last week at his temporary outpost inside the large law firm Weil, Gotschal & Manges. He seemed relaxed despite the pressures of two huge recent deals, and easily looks 20 years younger than his age, which is 53. "I can't get overextended, so I have to be judicious."
Taubman's lofty ranking is based on just two giant deals: Verizon's $130-billion acquisition of Vodafone's stake in Verizon Wireless - the biggest single deal of 2013 - and now, Comcast's $45 billion attempt to take over Time Warner Cable. Taubman has had long relationships with both Verizon and Comcast dating to his 30-year tenure at Morgan Stanley, as global head of mergers and acquisitions, global head of investment banking and, until the end of 2012, co-president of institutional securities, which included investment banking as well as sales and trading. The Verizon deal was years in the making, and Taubman previously advised Comcast on its acquisition of AT&T Broadband in 2002 and a stake in NBCUniversal in 2009.
In both cases, Verizon and Comcast reached out to Taubman after his noncompete clause with Morgan Stanley expired last May. "As John Lennon put it," he said, "Life is what happens to you while you're busy making other plans."
Taubman's re-emergence as a top deal maker answers the immediate question of what he would do after leaving Morgan Stanley. He was seen as the ultimate company loyalist and spent his entire career there after graduating from the Wharton School of the University of Pennsylvania in 1982 (except two years he spent completing an MBA at Stanford). He lasted through a succession of management upheavals, all the while rebuffing offers to join other firms. He lived in the same modest apartment he'd rented as a junior associate. He rarely sold any shares of company stock (and owned nearly 1.3 million shares in 2012), emerging at one point as the single largest individual shareholder in the company. In the depths of the financial crisis, he negotiated a deal with Japan's Mitsubishi UFJ Financial Group that is widely credited with saving the firm.
Many at Morgan Stanley took it for granted that Taubman would run the firm, and by 2012, he seemed only one rung away. But with the benefit of hindsight, former colleagues say the promotion to co-president of institutional securities was doubly flawed: It put Taubman squarely in management, taking him away from the deal -making and client-advising he did so well, and it pitted him against his co-president, Colm Kelleher, who ran the bigger sales and trading operation. They were temperamental opposites and reached a point where they barely spoke to each other.
In November 2012, Morgan Stanley announced that Mr. Kelleher would be the sole head of institutional securities, and that Taubman was leaving. Taubman could have stayed on as a senior deal maker reporting directly to the firm's chief executive, James P. Gorman, but it was clear his upward trajectory at the firm was over. "There was panic" at Morgan Stanley, one banker there told me. "Everyone was afraid the deal business would collapse."
Taubman had no immediate plans. When Barry M Wolf, executive partner at Weil, Gotshal, called to offer him office space, Taubman said he liked the idea of having an office to go to and a place to reconnect with clients. (He and his wife have a 2-year-old son at home, which is now an apartment on Central Park West that he bought from the comedian Robin Williams in 2000.) "The best advice I got was take some time and don't rush into anything," Taubman said.
But after just five relatively low-key months - he spent more time with his wife and son, got into shape at the gym and became board president of New York Cares - Taubman received an email from the head of corporate development at Verizon. Taubman had worked for Verizon for many years, including on the issue of what to do about the half of Verizon Wireless that Vodafone owned. Taubman met with Verizon's board and was soon enmeshed in the deal as a top advisor. Then, in October, he received a call from Comcast asking if he could help on the Time Warner Cable deal.
There turned out to be a silver lining for Morgan Stanley, because Mr. Taubman is working alongside his former colleagues in both deals. Morgan Stanley represented Verizon and is now working for Time Warner Cable. Morgan Stanley currently ranks No. 1 in the merger and acquisition league tables.
Taubman is close to Comcast's chief executive, Brian L Roberts. "Paul is one of the smartest and most creative individuals I've ever worked with," Roberts told me this week. "His capacity to think out of the box and to make things happen is almost unparalleled. He's been an invaluable counselor to Comcast and to me for over 20 years. And it's always a genuine pleasure to work with him."
Jimmy Lee, the prodigious deal maker at JPMorgan Chase, has worked closely with Taubman for decades, including on General Motors' initial public offering in 2010. He is also advising Comcast on the Time Warner Cable deal. "There are only a few bankers who command the allegiance and respect from chief executives and board chairmen that Paul does," Lee said. "And he's a closer. His deals get done. On top of all that, he's got this wonderful sensibility. I always feel we've come together and are working for the client, and that's what matters. There's never been one iota of Wall Street rivalry between Paul and me. That's a recipe for someone who can land two of the biggest deals right out of the box. He was perfectly suited to starting his own firm."
Robert B Schumer, a partner at Paul, Weiss, Rifkind, Wharton & Garrison, which is representing Time Warner Cable, described Taubman as "a great strategic thinker," adding, "He has a keen insight into the dynamics of a deal and is universally well liked. That he can do all this on his own is even more remarkable."
Still, not everyone is a member of the Taubman fan club, which is hardly surprising for someone who has worked on Wall Street for 30 years. Some executives at Time Warner have been cool to Taubman since he advised its board to embrace the ill-fated AOL merger in 2000, now viewed as what may be the worst deal in corporate history. (A Time Warner spokeswoman declined to comment.)
What lies ahead now that Mr. Taubman has landed so high in the league tables? It remains to be seen whether he can sustain the momentum from two big deals. Money shouldn't be an issue - he earned more than $10 million on the Verizon deal and may make at least that much if the Time Warner Cable acquisition succeeds. He could emerge as a kiosk, start a boutique investment firm, join a major bank as a senior deal maker - or stay resolutely on his own.
"I'm not making any declarations," Mr. Taubman said. "Right now, I'm enjoying being in the mix, helping clients and advising them. Longer term, I'm open to a more permanent structure."
©2014 The New York Times News Service
And then, at No. 11, there's Paul J Taubman.
Paul who?
Taubman isn't exactly a household name outside the limited precincts of investment banking. But at this rate he may become one, despite his personal modesty and long aversion to publicity. Investment bankers told me they couldn't recall another time when an individual occupied a slot this high on the league tables. (He was also No. 11 for all of 2013.) Taubman has single-handedly accounted for $175 billion in deals over the last year, which has had Wall Street bankers buzzing with a mix of admiration and envy.
Although Taubman's feat is unusual, he may be part of a fledging trend toward merger and acquisition microfirms, or, as in his case, sole practitioners. Two brothers, Michael and Yoël Zaoui are advising the French cement maker Lafarge in its $60-billion merger with another giant cement maker, Holcim, of Switzerland. Robertson Robey Associates, a microfirm that was known as "the three Simons" - Simon Robey, Simon Warshaw and Simon Robertson - until one of them broke off, advised Grupo Corporativo Ono of Spain in its $10 billion acquisition by Vodafone in March. (Robertson recently split off to form his own operation, and his former partners formed Robey Warshaw.)
Bankers have already coined a new catchword for such small firms: "kiosks," as opposed to the somewhat larger "boutiques," like Moelis & Company founded by Kenneth D Moelis, which went public this week.
Such arrangements can be fabulously lucrative, since kiosks have little or no overhead but are still paid as a percentage of the total cost of a successful deal. Clients receive the benefit of the undiluted attention of a top merger and acquisition strategist. Still, such tiny firms have their limits. "I'm just one person," Taubman told me when I visited him last week at his temporary outpost inside the large law firm Weil, Gotschal & Manges. He seemed relaxed despite the pressures of two huge recent deals, and easily looks 20 years younger than his age, which is 53. "I can't get overextended, so I have to be judicious."
Taubman's lofty ranking is based on just two giant deals: Verizon's $130-billion acquisition of Vodafone's stake in Verizon Wireless - the biggest single deal of 2013 - and now, Comcast's $45 billion attempt to take over Time Warner Cable. Taubman has had long relationships with both Verizon and Comcast dating to his 30-year tenure at Morgan Stanley, as global head of mergers and acquisitions, global head of investment banking and, until the end of 2012, co-president of institutional securities, which included investment banking as well as sales and trading. The Verizon deal was years in the making, and Taubman previously advised Comcast on its acquisition of AT&T Broadband in 2002 and a stake in NBCUniversal in 2009.
In both cases, Verizon and Comcast reached out to Taubman after his noncompete clause with Morgan Stanley expired last May. "As John Lennon put it," he said, "Life is what happens to you while you're busy making other plans."
Taubman's re-emergence as a top deal maker answers the immediate question of what he would do after leaving Morgan Stanley. He was seen as the ultimate company loyalist and spent his entire career there after graduating from the Wharton School of the University of Pennsylvania in 1982 (except two years he spent completing an MBA at Stanford). He lasted through a succession of management upheavals, all the while rebuffing offers to join other firms. He lived in the same modest apartment he'd rented as a junior associate. He rarely sold any shares of company stock (and owned nearly 1.3 million shares in 2012), emerging at one point as the single largest individual shareholder in the company. In the depths of the financial crisis, he negotiated a deal with Japan's Mitsubishi UFJ Financial Group that is widely credited with saving the firm.
Many at Morgan Stanley took it for granted that Taubman would run the firm, and by 2012, he seemed only one rung away. But with the benefit of hindsight, former colleagues say the promotion to co-president of institutional securities was doubly flawed: It put Taubman squarely in management, taking him away from the deal -making and client-advising he did so well, and it pitted him against his co-president, Colm Kelleher, who ran the bigger sales and trading operation. They were temperamental opposites and reached a point where they barely spoke to each other.
In November 2012, Morgan Stanley announced that Mr. Kelleher would be the sole head of institutional securities, and that Taubman was leaving. Taubman could have stayed on as a senior deal maker reporting directly to the firm's chief executive, James P. Gorman, but it was clear his upward trajectory at the firm was over. "There was panic" at Morgan Stanley, one banker there told me. "Everyone was afraid the deal business would collapse."
Taubman had no immediate plans. When Barry M Wolf, executive partner at Weil, Gotshal, called to offer him office space, Taubman said he liked the idea of having an office to go to and a place to reconnect with clients. (He and his wife have a 2-year-old son at home, which is now an apartment on Central Park West that he bought from the comedian Robin Williams in 2000.) "The best advice I got was take some time and don't rush into anything," Taubman said.
But after just five relatively low-key months - he spent more time with his wife and son, got into shape at the gym and became board president of New York Cares - Taubman received an email from the head of corporate development at Verizon. Taubman had worked for Verizon for many years, including on the issue of what to do about the half of Verizon Wireless that Vodafone owned. Taubman met with Verizon's board and was soon enmeshed in the deal as a top advisor. Then, in October, he received a call from Comcast asking if he could help on the Time Warner Cable deal.
There turned out to be a silver lining for Morgan Stanley, because Mr. Taubman is working alongside his former colleagues in both deals. Morgan Stanley represented Verizon and is now working for Time Warner Cable. Morgan Stanley currently ranks No. 1 in the merger and acquisition league tables.
Taubman is close to Comcast's chief executive, Brian L Roberts. "Paul is one of the smartest and most creative individuals I've ever worked with," Roberts told me this week. "His capacity to think out of the box and to make things happen is almost unparalleled. He's been an invaluable counselor to Comcast and to me for over 20 years. And it's always a genuine pleasure to work with him."
Jimmy Lee, the prodigious deal maker at JPMorgan Chase, has worked closely with Taubman for decades, including on General Motors' initial public offering in 2010. He is also advising Comcast on the Time Warner Cable deal. "There are only a few bankers who command the allegiance and respect from chief executives and board chairmen that Paul does," Lee said. "And he's a closer. His deals get done. On top of all that, he's got this wonderful sensibility. I always feel we've come together and are working for the client, and that's what matters. There's never been one iota of Wall Street rivalry between Paul and me. That's a recipe for someone who can land two of the biggest deals right out of the box. He was perfectly suited to starting his own firm."
Robert B Schumer, a partner at Paul, Weiss, Rifkind, Wharton & Garrison, which is representing Time Warner Cable, described Taubman as "a great strategic thinker," adding, "He has a keen insight into the dynamics of a deal and is universally well liked. That he can do all this on his own is even more remarkable."
Still, not everyone is a member of the Taubman fan club, which is hardly surprising for someone who has worked on Wall Street for 30 years. Some executives at Time Warner have been cool to Taubman since he advised its board to embrace the ill-fated AOL merger in 2000, now viewed as what may be the worst deal in corporate history. (A Time Warner spokeswoman declined to comment.)
What lies ahead now that Mr. Taubman has landed so high in the league tables? It remains to be seen whether he can sustain the momentum from two big deals. Money shouldn't be an issue - he earned more than $10 million on the Verizon deal and may make at least that much if the Time Warner Cable acquisition succeeds. He could emerge as a kiosk, start a boutique investment firm, join a major bank as a senior deal maker - or stay resolutely on his own.
"I'm not making any declarations," Mr. Taubman said. "Right now, I'm enjoying being in the mix, helping clients and advising them. Longer term, I'm open to a more permanent structure."
©2014 The New York Times News Service