THE LAST TYCOONS
The Secret History of Lazard Frères & Co.
By William D. Cohan
Doubleday; 741pp; $29.95
The Good: An ambitious if flawed account of Lazard?s near collapse and revival
The Bad: Marred by analytical lapses and rumor-mongering about various bank personalities
The Bottom Line: The volume falls well short of high standards set by classics in the field
What is it about investment banking that brings out the long knives? Internecine warfare is so prevalent in that culture that books about Wall Street houses are inevitably crowded with villains and desperately short on heroes. Remember Greed and Glory on Wall Street, Ken Auletta's 1986 account of the civil war that ripped apart Lehman Brothers Kuhn Loeb? William D. Cohan's The Last Tycoons, an ambitious if flawed history of Lazard Frères & Co. (now Lazard Ltd.), is just such a book.
In 2005, Lazard became the last of the classic investment-banking partnerships to convert to public ownership. A midsize firm with an outsize mystique, Lazard had been a fount of profit and intrigue for the better part of a century and a half.
It could scarcely have been otherwise given Lazard's pedigree. For most of its history, the House of Lazard was actually three separate investment banks of different nationalities—American, French, and British—coexisting uneasily under the shared roof of overlapping ownership. Lazard also was the first investment bank built on advising corporate mergers and acquisitions, the most Machiavellian of high-finance specialties. Finally, it has been led by a procession of legendarily brilliant and difficult personalities, including André Meyer, Felix Rohatyn, and current CEO Bruce Wasserstein.
At 741 pages, the copiously footnoted volume aspires to be a definitive history of Lazard. The author, a former newspaper reporter who spent six years at the firm as a junior banker, is commendably thorough in his research, which includes interviews with dozens of key participants, Wasserstein prominently excepted. Even so, Cohan's sprawling volume falls well short of the standards of interpretive analysis and literary excellence set by such classic works as Financier, Cary Reich's 1983 biography of Meyer, and Ron Chernow's 1990 tome, The House of Morgan.
The Last Tycoons does benefit from well-drawn profiles of many of Lazard's leading characters, particularly Michel David-Weill, the clever, imperious French billionaire whose family controlled the firm for four generations and who presided over it himself from 1977 to 2005. Both David-Weill, Lazard's last emperor, and Rohatyn, the founding father of M&A, emerge from these pages in all their fascinating complexity and maddening hypocrisy.
The book's other strength is its closely reported narrative of the tumultuous events of the past decade, which saw Lazard's near-collapse in David-Weill's final years and its revival under Wasserstein, who previously had made a fortune co-founding and selling Wasserstein Perella. The success of Wasserstein's ingenious, daring scheme to transform Lazard into a publicly held corporation added hugely to his net worth while reviving the foundering bank. Lazard's stock has doubled since going public at $25 a share in the spring of 2005.
Cohan's lengthy account of David-Weill's and Wasserstein's climactic pas de deux might indeed prove definitive despite occasional lapses of analytic judgment. Cohan suggests, for example, that Wasserstein's initial $30 million investment in Lazard was money he'd saved (and would not otherwise have had) by moving to London to avoid paying New York state and city taxes on the $1.4 billion sale of Wasserstein Perella. Setting aside the question of Wasserstein's motive for moving to London, he was a wealthy man who could have pulled $30 million from any of the pockets in one of his bespoke suits.
Worse, Cohan spices up what is a pretty technical saga with a lot of thinly sourced rumor-mongering about the sexual misadventures of high- and low-ranking Lazard employees. He closes one particularly salacious section by noting: "These rumors persisted, even though some clearly were not true." Why smear people by printing stories known to be false?
That Cohan once worked at Lazard causes a reader to wonder whether there is score-settling mixed in with his journalism. That said, the author often puts his inside knowledge to constructive use, such as in his amusing explication of David-Weill's passion for Cuban cigars and the social significance of cigar-smoking at the firm.
The Last Tycoons should appeal to anyone interested in the inner workings of Wall Street or Lazard, long the most idiosyncratic of investment banks. Despite the upheavals this book documents, Lazard still occupies the same basic position on the Street that it did in the 1950s and '60s—that of a compact, elite M&A specialist with a front-row seat at the deal game.
By Anthony Bianco