July 25 (Bloomberg) -- Neal McCabe, a former global co-head of a Lehman Brothers unit whose career included working for Salomon Brothers, an heir to the Wal-Mart Stores Inc. fortune and a Texas oil company, has died. He was 60.
He died on July 17 at New York-Presbyterian Hospital/Weill Cornell Medical Center, according to his sister, Kim McCabe. He had suffered a stroke two months earlier. McCabe was a resident of Manhattan.
His wide-ranging work carried him to Dallas, where he helped run a company in oil and gas exploration and sales, and to Fayetteville, Arkansas, where he worked for an investment bank created by the daughter of Wal-Mart founder Sam Walton. In recent years, he tried to create a fund focusing on investments in minority communities.
“He was an entrepreneurial guy, who had the guts to leave a situation and strike off and do something he thought would be interesting and successful,” his friend, Stephen M. Wolf, the former chairman and chief executive of US Airways and United Airlines, said in an interview. He first met McCabe in the 1980s in Dallas, where McCabe was working for Salomon Brothers.
At New York-based Lehman Brothers Holdings Inc., McCabe was global co-head, with Robert C. Cox, of a business initiative aimed at increasing trades with securities dealers around the world. Their work started in fixed-income -- a reflection of McCabe’s experience as a municipal bond trader -- and expanded to equities and wealth management, said Cox, who is now managing director at New York-based G2 Investment Group, in its Forbes Private Capital Group unit.
“We put that business on the map,” Cox said yesterday in an interview. He said Lehman management believed that “if we want to grow our market share, this is one way to do it.”
Also while at Lehman, McCabe helped run TexPool, an investment pool for thousands of communities in Texas.
Neal Graham McCabe was born on Oct. 26, 1952, in Boston and raised in the suburb of Needham, the oldest of four children. His father, Robert V. McCabe, was director of athletics and then associate superintendent of the Boston public school system. His mother, the former Alice Graham, worked for 34 years in the Harvard University athletic department, coaching swimming for 14 of those years.
McCabe swam competitively at Worcester Academy and at Brown University in Providence, Rhode Island, where he received a bachelor’s degree in political science in 1975.
He worked as a bond trader for Salomon Brothers in New York, then in Dallas, becoming a vice president. In 1981 he became chairman of Dallas-based Shanley Oil Co. and led its acquisitions of, among other companies, Nord Petroleum Corp. in 1983. The company in 1986 became Shanley Corp.
In 1989 he worked for Llama Co. of Fayetteville, Arkansas, an investment bank founded the previous year by billionaire Alice Walton. She is now the world’s second-richest woman, after her sister-in-law Christy Walton, with a net worth of $35.2 billion, according to the Bloomberg Billionaires Index.
Llama was created as a broker-dealer and to manage portfolios of fixed-income securities for individuals and banks running pension and profit sharing plans, according to Forbes magazine. Alice Walton, an equity analyst who had once worked for E.F. Hutton & Co. in New Orleans, named the firm Llama because she had one as a pet.
Following a stop in Florida, McCabe joined Lehman Brothers in 1993 as a senior vice president and was later made a managing director.
According to a 2003 article in the Bond Buyer, he ran the Lehman division that managed TexPool, the oldest and largest investment pool for local governments in Texas. Lehman Brothers and Federated Investors Inc. were chosen as the pool’s fund managers in 2002, with Lehman handling customer service and daily operations and Federated handling investments, according to the article.
Following Lehman’s bankruptcy in 2008, and subsequent acquisition by Barclays Plc, McCabe formed Madison Asset Management Group with a Lehman colleague, Ernest Green. They aimed to create a fund “that would focus on investment opportunities in the minority community,” according to a Jan. 16 legal opinion in a dispute between McCabe and Green.
Green was a respected civil-rights figure for his role as one of the “Little Rock nine,” the black students who integrated Central High School in Little Rock, Arkansas, in 1957 and a former assistant secretary of labor in the administration of President Jimmy Carter.
McCabe brought in Green as his co-chairman to use Green’s “well-established network of high level contacts in the minority business and government community for the purpose of recruiting investors and identifying minority-focused business opportunities,” according to the opinion.
The two former colleagues wound up in a disagreement over $85,000 in loans that McCabe made to Green during a two-year period when Green’s $500,000 annual salary wasn’t being paid. Green ended up leaving McCabe to join Matrix Advisors when it was headed by former Lehman CEO Richard Fuld.
Green didn’t return calls seeking comment on McCabe.
Survivors include his mother, who lives in Boca Raton, Florida; and his sisters, Gail Hackett of Marshfield, Massachusetts; Kyle McCabe, of Boca Raton; and Kim McCabe of Branford, Connecticut.
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