Oct. 16 (Bloomberg) -- Lazard Ltd. directors plan to convene within two weeks to consider a permanent replacement for Bruce Wasserstein, the chief executive officer who died this week at 61, said two people with knowledge of the matter.

The panel aims to determine whether to keep interim CEO Steven Golub, 63, in the job or to name someone else to run the investment bank, said the people, speaking anonymously because the talks are private. Besides Golub, potential candidates may include Lazard executives Kenneth Jacobs, 51, Charles Ward, 57, and Gary Parr, 52, according to current and former bankers at the firm, who aren’t privy to the board’s deliberations.

Wasserstein’s death set off a succession contest at a 161- year-old institution that he unified and transformed into a publicly traded company. The stakes are high because Lazard gets most of its money from the work of dealmakers who could quit if they clash with a new leader.

“What they now have to be worried about is if three guys want to be CEO and they can only pick one, the other two will get all upset and walk out,” said Richard Bove, an analyst at Rochdale Securities in Lutz, Florida. “If they walk out, they take all the business with them.”

Monica Orbe, a Lazard spokeswoman, declined to comment.

Reliance on Takeovers

Unlike Lazard’s bigger competitors in advising on mergers and restructuring, Lazard depends on those businesses for most of its revenue. Goldman Sachs Group Inc., the world’s biggest merger adviser last year, got 12 percent of its $22.2 billion of net revenue from the business, compared with 60 percent of Lazard’s $1.56 billion. Current and former Lazard employees own half of the firm through a holding company called LAZ-MD. Wasserstein and his family trust own about 16.2 million shares, or about 11 percent.

“Even though this is a public company, it really isn’t,” Bove said. “It’s a private company run by the insiders for the benefit of the insiders.”

Lazard’s bankers work on the world’s biggest mergers and bankruptcies and reap fees to match. Parr earned Lazard $20 million in a few days last year advising Bear Stearns Cos. on its efforts to stave off collapse. Antonio Weiss, 43, won Lazard a role advising InBev NV on its $52 billion takeover of Anheuser-Busch Cos. last year, and the lion’s share of a fee pool that Freeman & Co. estimated at $75 million to $85 million. A Lazard team including Barry Ridings [AGE] has earned $11.9 million for advising Lehman Brothers Holdings Inc. since the brokerage filed the world’s largest bankruptcy in September 2008.

Wasserstein Proteges

Wasserstein, who joined Lazard in 2001, has filled the firm’s top ranks with associates from his previous stints at First Boston Corp. and Wasserstein Perella & Co.

Parr is a protégé of Wasserstein since the 1980s, when he worked for him at First Boston. They left in 1988 for Wasserstein Perella, the firm Wasserstein started with Joseph Perella, another dealmaker at the bank. Parr, founder of an ethics institute at the University of North Carolina and chairman of the New York Philharmonic, specializes in advising financial executives around the world on takeovers.

Ward is another Wasserstein protégé from First Boston, who, like Parr, left for Wasserstein Perella. He later returned to what had become Credit Suisse First Boston before Wasserstein recruited him to Lazard in 2002 as president. He later took responsibility for Lazard’s asset-management unit, which swelled to $615 million in revenue last year from $350 million in revenue in 2003.

Rohm’s Sale

Jacobs, who joined Lazard in 1988 from Goldman Sachs and became a partner in 1991, runs Lazard’s North American business. This year, he worked with Philadelphia’s Haas family, the major shareholder of Rohm & Haas Co., on the company’s $16.5 billion sale to Dow Chemical Co. He also helped GlaxoSmithKline Plc on its $2.9 billion purchase of Stiefel Laboratories Inc.

Golub, who has been at Lazard for 25 years, has served as chief financial officer and vice chairman, and helped Wasserstein present the firm’s financial results to analysts after the firm went public. He continues to do advisory work for clients, counseling Trane Inc. on its $10 billion sale to refrigeration equipment maker Ingersoll-Rand Co. last year.

Golub may well end up staying in his job, said William Cohan, who wrote “The Last Tycoons” about Lazard in 2007.

“He’s respected in the firm because he’s a deal guy,” Cohan said. “I don’t see any uprising or infighting about this.”

Other potential contenders, according to the current and former Lazard bankers, include Frank “Terry” Savage, 62, a senior banker in the restructuring group; Jeffrey Rosen, 57, a deputy chairman; and William Rucker, 46, the head of Lazard’s U.K. operation.

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

Last Updated: October 16, 2009 16:02 EDT