The Rjr Nabisco He's Leaving Behind

Henry R. Kravis sighed with relief when he signed up Louis V. Gerstner Jr. in 1989 to run RJR Nabisco Holdings Corp. The $25 billion leveraged buyout of RJR was considered a triumph for Kohlberg Kravis Roberts & Co. But the company's balance sheet was an unqualified disaster, overloaded as it was with almost $30 billion in debt. Kravis was betting that Gerstner, fresh from the No.2 job at American Express Co., was just the sort of hardened manager who could cut the fat and get RJR humming.

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