A Match Made in Hell
The New York Times takes apart John Thain and his tenure at Merrill Lynch. A dismal portrait of self-importance and self-aggrandizement, it will do more to damage Thain’s reputation than the office decorating. Just to cite a few random examples, Thain asked for $40 million in bonus for getting the Bank of America deal done; he remained disconnected from Merrill’s operations and allowed his closest lieutenants to hold the same defensive, I-didn’t-make-this-mess attitude. But for all of Thain’s faults, the story ultimately indicts Ken Lewis for taking the virus on board his own mothership:
“When you go into a deal, you hope for the best but expect the worst,” says Nancy Bush, a banking analyst. “I think Bank of America did plenty of due diligence; they just ignored what they found. They knew it was there. They just didn’t completely grapple with the fact that it could get uglier. And it did.”
Source:
For Bank of America and Merrill Lynch, Love Was Blind
LOUISE STORY and JULIE CRESWELL
New York Times; February 8, 2009
http://www.nytimes.com/2009/02/08/business/08split.html
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February 7th, 2009 at 9:53 pm
Lewis may have had an inkling what he was buying, but he didn’t want to know too much. At the time, getting bigger was a great strategy…become too big to fail. Any CEO worth his yacht has an innate desire to build a bigger empire anyway. This was a no brainer.
February 8th, 2009 at 12:08 pm
I always assumed that this deal, as well as the CFC one, was a shotgun marriage mandated by the Fed/Treasury, and that there was always an explicit promise they’d back it if it went sour.
Now, it seems, we’re learning that it wasn’t.