Oct. 12 (Bloomberg) -- Bruce Wasserstein, chairman and chief executive officer of Lazard Ltd. and one of Wall Street’s biggest dealmakers, is stable after being hospitalized with an irregular heartbeat, his company said.

“His condition is serious, but he is stable and recovering,” Lazard said in a statement yesterday. Judi Mackey, a spokeswoman for the firm in New York, declined to comment beyond the statement.

Wasserstein, 61, is personally leading the team advising Kraft Foods Inc. CEO Irene Rosenfeld on her $16 billion takeover bid for British chocolate maker Cadbury Plc, the latest in a career that stretches more than three decades. Among deputies who might succeed him if health issues reduce his role are Steven Golub, 63, and Kenneth Jacobs, 51, said William Cohan, author of “The Last Tycoons,” a book about Lazard.

“Wasserstein has been the driving force behind this company,” said Richard Bove, a Lutz, Florida-based analyst at Rochdale Securities Inc., in a research note today. “Should he be lost to illness, the company is expected to suffer.”

Lazard shares dropped 50 cents, or 1.2 percent, to $41.40 at 4:02 p.m. in New York Stock Exchange composite trading. The shares gained 41 percent this year through Oct. 9 after losing 27 percent in 2008. Bove continues to rate Lazard shares “buy,” saying that the firm will benefit from an increase in mergers and acquisitions.

Atrial Fibrillation

Atrial fibrillation, which is what doctors usually mean when they refer to irregular heartbeat, is associated with an increased risk of stroke and is “not typically classified as a life-threatening rhythm problem,” said Vias Markides, a cardiologist at the Royal Brompton Hospital in London who is not involved in Wasserstein’s treatment. “A lot of increase in the risk is in patients who have other heart problems.”

Wasserstein worked as a lawyer at Cravath Swaine & Moore LLP before joining First Boston Corp., now part of Credit Suisse Group AG, in 1977. He and colleague Joseph Perella built First Boston into a dominant player in the booming mergers and acquisitions business before quitting in 1988. The two founded Wasserstein, Perella & Co., an advisory firm that was sold to Germany’s Dresdner Bank AG for $1.56 billion in January 2001.

While running his old firm from 1988 to 2000, Wasserstein advised on transactions such as Philip Morris Cos.’ $13 billion bid for Kraft Inc. and Kohlberg Kravis Roberts & Co.’s $31.4 billion offer for RJR Nabisco Inc.

Public Offering

Michel David-Weill, a descendant of Lazard’s founding family, hired Wasserstein in 2001 to revive the company. Wasserstein, who became Lazard’s second-largest individual shareholder when he joined the firm, recruited more bankers and, over David-Weill’s objections, sold shares to the public for the first time in May 2005. Lazard, incorporated in Bermuda, is led by Wasserstein out of the firm’s office in Manhattan.

David-Weill, 76, left the firm he ran for 25 years in 2005 when Wasserstein took Lazard public. Wasserstein’s net worth is about $2.2 billion, making him the 147th richest American in 2009, according to Forbes Magazine.

Founded as a dry goods business in New Orleans in 1848, Lazard ranks seventh among financial advisers for announced mergers and acquisitions globally this year, behind larger Wall Street companies Morgan Stanley, Goldman Sachs Group Inc., Citigroup Inc. and JPMorgan Chase & Co., according to data compiled by Bloomberg.

Corporate Restructurings

The investment bank in July reported profit that beat analysts’ estimates as revenue from advising on corporate restructurings almost tripled. Second-quarter earnings dropped 33 percent to $43.1 million in the same period a year earlier.

Lazard is countering a slowdown in mergers and acquisitions with its restructuring advisory business, where the firm said it worked on nine of the top 10 bankruptcies this year. Second- quarter financial restructuring revenue rose to a record $93.2 million.

Wasserstein’s sister, Wendy, a Pulitzer-prize winning playwright, died in January 2006 at 55 after a battle with lymphoma.

To contact the reporters on this story: Zachary R. Mider in New York at zmider1@bloomberg.net; Josh Fineman in New York at jfineman@bloomberg.net

Last Updated: October 12, 2009 16:09 EDT