Last year, a li’l investment bank that could called Jefferies paid out bonuses comprised entirely of cash. This proved pretty popular, so this year, CEO Dick Handler has decided to do it again. Read more »
Jefferies Chief Executive Officer Richard Handler said he sued to stop construction of a roof deck across the street from his Tribeca apartment on behalf of his neighbors, according to an e-mail to employees. “I took the lead to help our neighborhood oppose what we know will be a major nuisance and disruption to our lives,” Handler, 51, said in the March 31 correspondence, the contents of which were confirmed by a Jefferies spokesman. “You can be assured we are not going after the city in any way and are only asking for their help in dealing with a huge potential problem.” Handler told employees he wrote the e-mail to apologize for “recent distractions in the media concerning me,” including stories that portrayed him as a “tone-deaf one-percenter.” [Bloomberg]
Until recently, being chief executive officer of Jefferies was an exercise in getting shit on. As the man in charge for the last 13 years, Richard Handler has had to put up with a lot of hurtful remarks that, while nothing to the person tossing them off, undoubtedly stung quite badly. “Third-tier bank.” Place “I wouldn’t let my maid’s kid work.” “Poor man’s Morgan Keegan.” So you can imagine that after a string of victories over the last several months that included getting involved in the slaughterhouse business and paying all-cash bonuses unlike some people, Handler and Co. would be feeling pretty good about themselves and that after announcing to the world they were getting paid more this year than their counterparts at big kid banks, they’d be feeling REALLY good about themselves. That payday, however, did not go over well when input into Moody’s proprietary just-make-it-up credit-rating model, and now Handler’s plan to gather everyone up to watch as the board shoots his compensation out of a tee-shirt gun in hundred dollar bills is completely ruined.* Read more »
Dick Handler ended up doing pretty okay for himself. Read more »
Back in the day, as in pre-crisis, bonus season on Wall Street was a happy time. Sure, you still had your miserable pricks who would bitch and moan about the fact that they hadn’t gotten as much as the guy who sat next to them, even they the guy who sat next to them was a “non-contributing zero who wouldn’t recognize alpha if it bit him in the ass,” but prior to to fall 2008, anyone who was unhappy about his or her bonus was a) quibbling over receiving a huge sum of money instead of an imperial fuck-ton of money and b) in a position to actually make good on a threat to jump ship, since firms were hiring. Now, with a few exceptions, bonus season makes people feel sad. Angry. Powerless. Frustrated. Confused. Like the world is out to get them. Not only has the total amount of one’s bonus come down, but many companies have decreased the cash portion, while increasing the deferral period on stock to, in some cases, almost half a decade. Then you have Jefferies. Last year it let employees decide between an all stock bonus or an all cash bonus with 25% lopped off. This year the investment bank-cum-butcher shop isn’t even forcing anyone to choose, instead dumping a bag of cash on people’s desk and reminding everyone who loves ‘em. Read more »
Leucadia National Corp., which EDGAR tells me is in the “Lumber & Wood Products (No Furniture)” business but which also processes beef, drills for oil, owns a Mississipi casino and develops biopharmaceuticals, is getting out of one business:
Leucadia National Corporation (NYSE: LUK) and Jefferies Group, Inc. (NYSE: JEF) today announced that the Boards of Directors of both companies have approved a definitive merger agreement under which Jefferies’ shareholders (other than Leucadia, which currently owns approximately 28.6% of the Jefferies outstanding shares) will receive 0.81 of a share of Leucadia common stock for each share of Jefferies common stock they hold. …
Leucadia will continue to operate in its current form, except that the merger agreement contemplates that Leucadia’s Crimson Wine Group, with a book value of $197 million, will be spun out in a distribution that is intended to be tax-free to current Leucadia shareholders prior to the completion of the merger.
I assumed that the spinoff was driven by some sort of regulatory impediment (alcoholic or financial), though on the analyst call for the merger Jefferies said that Crimson was just “less synergistic” to the combined business than … I guess, than the casino or the slaughterhouse? Still, I like it: you can combine a casino and a wine business, or a casino and an investment bank, but not a wine business and an investment bank. Do you think the investment bankers are prudes, or the winemakers?
What are the investment bankers up to anyway? It makes a lot of sense for a low-investment-grade wee investment bank who recently overcame a near-death experience re: Eurozone sovereign bonds to sell itself to a highly rated financial conglomerate – a “baby Berkshire Hathaway” no less – with a big balance sheet that can provide cheap funding for its bond-market misadventures. But this isn’t that: Leucadia’s rating is 2-3 notches lower than Jefferies’, and its balance sheet is smaller, though Moody’s is talking about upgrading Leucadia on the deal.
Richard Handler has declared himself not worthy. Read more »