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Paper Chase

BIG DEAL: The Battle For Control of America's Leading Corporations.\o7 By Bruce Wasserstein (Warner Books: 820 pp., $30)\f7

June 28, 1998|SUZANNA ANDREWS | Suzanna Andrews writes for several publications, including Vanity Fair, Rolling Stone and Mirabella

Ten years ago, Ivan Boesky was serving time in prison for masterminding one of history's biggest insider trading scandals. Michael Milken had been indicted on 98 counts of securities fraud and racketeering and would soon begin his own prison sentence. Drexel Burnham Lambert, the Wall Street investment bank that had come to symbolize the excesses of the 1980s corporate takeover mania, was on the verge of bankruptcy. Many of the companies that had been involved in the biggest deals of the time were themselves struggling to stay afloat. Indeed, as the 1990s began, it seemed that a calm had come over corporate America. The high-testosterone capitalism of the 1980s--when scores of companies were bought, sold and busted up--had played itself out. Or had it?

Almost every day now the news is filled with accounts of yet another corporate merger or acquisition. Quick: Which foreign publisher just bought Random House, and which one bought Simon & Schuster? Name the two phone companies that were bidding for MCI before it was sold to WorldCom. What company just bought Chrysler? Who can keep track of which Internet company is buying which? Or which of the Baby Bells has merged with which?

From 1993 to the end of last year, a mind-bending $2 trillion worth of corporate assets changed hands. In sheer number of deals, the '90s will probably outpace the '80s, and when it comes to size, the biggest deal of the '80s--the $25-billion takeover of RJR Nabisco--already looks like pocket change next to this year's $83-billion planned merger of Travelers Group with Citicorp.

Clearly, the forces of capitalism are alive and well, but what are they up to? What is driving these mergers? Who benefits from them? Is it just boys at play with their toys or is there some fallout from this process that we should care about?

Bruce Wasserstein's "Big Deal: The Battle for Control of America's Leading Corporations" arrives at a timely moment. Clocking in at an ambitious 820 pages, it is an attempt to tell the story of the changing corporate landscape during the last 30 years and to offer a behind-the-scenes look at "the most famous takeover brawls of our time" by the man who is regarded as something of a legend in the business of mergers and acquisitions.

Many more people have heard of his illustrious sister, Pulitzer Prize-winning playwright Wendy Wasserstein, but Bruce Wasserstein, although less famous, has himself helped to create some great drama. One of Wall Street's best-known investment bankers, Wasserstein was a familiar fixture in corporate boardrooms in the '80s, one of a handful of star investment bankers whose advice on mergers and acquisitions CEOs would pay millions of dollars for.

He was present at the creation of hundreds of deals, among them the takeover of RJR Nabisco; the struggle for control of Paramount; Philip Morris' $13-billion acquisition of Kraft; and, more recently, Dean Witter's merger with Morgan Stanley. Wasserstein saw the boardroom fights, the late-night screaming matches, and if anyone had insight into the fears, aggressions and ambitions that drove CEOs to stalk other companies or to sell their own, Wasserstein, canny and quick to pounce, did.

On the face of it, almost no one would be better positioned to explain the wild world of corporate takeovers. He knows the game, and he played it with relish, famously leaking fascinating tidbits of information about deals to the press when it suited his interests--so much so that the financier Henry Kravis, who bought RJR Nabisco, suspecting him of leaks on that takeover deal, shut him out of key meetings.

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