A Dark Horse at Citi
Citigroup's (C) Michael S. Klein is the embattled bank's consummate dealmaker. With deep ties in the Middle East, the 44-year-old chairman and co-chief executive of markets and banking was instrumental in securing a $7.5 billion cash infusion from Abu Dhabi Investment Authority in late November. "Klein's the ultimate relationship man," says a private equity player familiar with the situation. "He did the deal in a phone call."
Klein is part of a core group of top executives, including Chairman Robert E. Rubin, Chief Financial Officer Gary Crittenden, and interim CEO Sir Win Bischoff, who have spent the past month or so calming worried investors and clients around the globe. In the days leading up to the resignation of Chief Executive Charles O. Prince, Klein accompanied former Citi boss Sanford I. Weill on the corporate jet to Riyadh to help ease tensions with Citi's second-biggest shareholder, Saudi Prince Alwaleed bin Talal.
His new role is generating buzz that he's a dark-horse candidate for the top job, even though his boss, Vikram Pandit, is also considered a contender. "I don't think Vikram's arrival has done anything to dissuade Michael that he could be the next leader at Citigroup," says an executive at a rival firm who worked with Klein at Salomon Brothers. Klein was in the Middle East at press time and unavailable for comment.
Starting at Salomon in 1985, which Citi bought 12 years later, Klein worked his way up the investment banking ranks. In 1999, he took over the European investment banking operations. There he gained prominence for melding the disparate cultures of Schroders and Citi, which bought the staid British merchant bank in 2000.
As co-head of Citi's investment banking efforts, he courted hedge funds and private equity titans, forging strong alliances with Kohlberg Kravis Roberts and Blackstone Group (BX). Klein's connections landed Citi a major advising role in the largest buyout so far, the Oct. 10 sale of TXU to a consortium led by KKR.
Klein, however, lacks experience in retail banking. Subprime losses aside, Citi's biggest headache is figuring out how to revive its consumer banking and credit-card businesses, which make up more than half of the company's profits. Even so, his role in the Abu Dhabi deal has upped his visibility at Citi.