Via Financial Times

Felix Rohatyn, who twice fled the Nazis as a child and went on to reach the highest echelons of Wall Street and the New York establishment, has died at age 91.

Rohatyn, over a nearly 50-year career at the financial boutique Lazard, invented the model of the “trusted adviser” investment banker — counselling chief executives and boards of such blue-chips as ITT and Pfizer in their most sensitive matters. Rohatyn used his financial acumen, connections and diplomatic savvy to move between high finance and elite civic and government posts. He emerged as a public figure in the 1970s shepherding New York City through its fiscal crisis. Between 1997 and 2000 Rohatyn served as the US ambassador to France for President Bill Clinton.

Felix Rohatyn was born in Vienna in 1928 to Alexander and Edith Rohatyn. In 1935 with the rise of the Nazi party, the family fled Austria for France. In 1940, with his parents divorced, Rohatyn, his mother and stepfather once again escaped the Nazis, leaving France for Casablanca with visas provided by Luis Martins de Souza Dantas, Brazil’s ambassador to France.

After a time in Rio de Janeiro the family made its way to New York City in 1942. Seven years later, Rohatyn graduated from Middlebury College in Vermont with a degree in physics. After being drafted by the army, he served in Germany during the Korean war.

Before his military service, Rohatyn had been introduced to Andre Meyer, the legendary Frenchman who ran Lazard’s New York office. After several years at the firm, Rohatyn became a Lazard partner in 1961. The big Wall Street houses like Goldman Sachs and Morgan Stanley were at the time more interested in securities offerings than mergers and acquisitions. But as the corporate conglomerate wave accelerated in the 1960s, buying and selling companies became a business that the modestly sized Lazard could compete in.

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Rohatyn’s most storied and controversial relationship was with ITT Corp, originally a telecom company that would become the archetypal conglomerate under chief executive Harold Geneen. Geneen and Rohatyn took walks together in Manhattan in the middle of the night discussing ITT’s latest acquisition targets. ITT became the subject of a federal antitrust investigation that the company would settle. Later there were accusations, never proved, that ITT had offered the Republican Party administration $400,000 in exchange for dropping the case.

Most seriously, ITT was accused of funding anti-leftist forces in Chile where the company had business interests. Mr Rohatyn testified to Congress about his ties to ITT and faced harsh criticism for his close relationship with Geneen. He resigned from the board of ITT in 1981 after serving as a director for 13 years. Lazard and Rohatyn continued to work with the company for decades.

By the mid-1970s, New York City was suffering from a constant budgetary shortfall, reduced public services and deteriorating infrastructure. The city had become reliant on accounting gimmicks and short-term bank financing to fund its bills. Governor Hugh Carey asked Rohatyn to join a commission to address the city’s financial problems. The commission created a new agency called the Municipal Assistance Corporation that had the power to sell debt and tap city revenue. Rohatyn served as chair of the MAC, helping it negotiate a short-term, multibillion-dollar bailout and austerity package with Washington, banks, the city, unions, and municipal workers. The belt-tightening was felt in the form of reduced public services and quality of life in New York for years, but by the early 1980s the city was back on a solid financial footing.

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In the 1980s, Lazard and Rohatyn were prime players in the junk bond driven takeover boom. Rohatyn represented the RJR Nabisco board that ultimately agreed to sell the company to KKR in a record-shattering $25bn leveraged buyout chronicled in the book Barbarians at the Gate.

WASHINGTON, DC - JANUARY 20: Felix Rohatyn, president of FGR Associates LLC announces his support for the creation of a National Infrastructure on Capitol Hill January 20, 2010 in Washington, DC. A coalition of elected and former office holders and business people assembled to announce their plan to help persuade Congress and the Obama administration to fund and support a bank which would be created to fund local and national infrastructure projects and thereby promote the US economy and create jobs. (Photo by Chris Kleponis/Getty Images)
Rohatyn in 2010 tried to persuade Congress and the Obama administration to fund a bank which would fundl infrastructure projects © Getty

Rohatyn, a longtime Democrat, initially supported Ross Perot’s 1992 presidential bid. After Bill Clinton won the presidency, Rohatyn was tapped to be vice-chairman of the Fed, a bid that failed in a Republican-controlled Senate. His post as Ambassador to France was seen as a come down for a man who aspired to be treasury secretary. Still, Rohatyn was moved by the chance to serve in the country he had fled as a child and he would become a Commander of the French Legion of Honor. He would also serve on the board of such French stalwarts as Publicis and Schlumberger.

By the time he finished his stint in Paris in 2000, Lazard, his home for nearly 50 years was in turmoil. Fighting between its “houses” in Paris, London, and New York had reached nearly intolerable levels and many of its top rainmakers had departed. Michel-David Weill, the then Lazard boss and member of the founding family, would recruit Rohatyn’s one-time rival Bruce Wasserstein to lead a revival of the firm.

Rohatyn started his own boutique, Rohatyn Associates, in 2001. He also later served as an adviser to Rothschild, Lazard’s arch-rival, and Lehman Brothers, a firm Lazard once nearly merged with at the turn of the century. After Wasserstein died in 2009, new Lazard chief executive Ken Jacobs brought Rohatyn back to Lazard as an adviser.

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“He had a unique ability to deal with the CEOs of the major corporations,” said Marty Lipton, co-founder of New York-based corporate law firm Wachtell, Lipton, Rosen & Katz. “His handling of the NYSE financial crisis and later the NYC financial crisis were among the most significant accomplishments by any banker in the 20th century.”

In 2010, Rohatyn published his memoirs, Dealings. He maintained an interest in public policy, writing a book and authoring op-eds in the Financial Times. Rohatyn’s first marriage ended in divorce. His second wife, Elizabeth, a prominent Manhattan socialite, died in 2016. Rohatyn is survived by three sons, a stepdaughter, and six grandchildren.

additional reporting by James Fontanella-Khan in New York