Michael Milken on Drexel’s Legacy and Negotiating With Carl Icahn
It’s been about three decades since the heyday of Michael Milken’s Drexel Burnham Lambert. It all came crashing down, but his legacy lives on in the high-yield market, in such firms as Moelis & Co. and at the Milken Institute, a think tank whose global conference starts Sunday in Los Angeles. A reunion dinner for Drexel alumni and clients is also planned.
Dozens of Milken’s former colleagues have risen to the top in finance and real estate, including Leon Black, co-founder of Apollo Global Management; Ares Management’s Tony Ressler; and David M. Solomon, who’s in line to be the next head of Goldman Sachs Group Inc.
Milken, 71, discussed Drexel’s continuing influence during a phone interview in March. The following comments have been condensed and edited.
Bloomberg: What are you most proud of?
Michael Milken: The diaspora of people that worked for me: Kenny Moelis; Rich Handler, who runs Jefferies; Jon Sokoloff over at Leonard Green. Leon Black, Tony, and Richard Ressler and so on. What I’m most proud of is that they are responsible members of the community and have used their wealth creation in the fields of philanthropy and obviously, building successful businesses. Today, there’s something like 72 people who used to work with me, or for me at Drexel, who are now in senior positions in other financial firms.
How do you approach negotiations?
Even if you have a price that a person would want to do the transaction, sometimes you have to let a person feel like they can negotiate. A person like Carl Icahn, for example: It would take the thrill out of it if he couldn’t negotiate.
Anything in particular you look for when hiring?
When I interviewed people over the years, I wanted to meet their families. When you get a chance on a casual basis to meet their families, it’s a good demonstration of the ability of the person as partner and team player.
What is Drexel’s legacy?
We had a mission. A view of creating access to capital for small and medium businesses—to align management with owners—I think that’s been achieved. The idea of how do you finance a business has been passed on.