compensation committee of
corporate aircrafts of
diversification of
divestitures of
due diligence and
early retirement program of
Gerstner as CEO of
image problem of
income of executives of
International Advisory Board
Johnson’s loss of interest in
lawsuits against
leveraged buyout of
announcement
management agreement
management group bid for
“Other Uses of Cash” and
perks provided by
press releases of
Project Smokescreen and
public relations of
reorganization of
rumors about
salaries paid by
security system of
severance provisions of
Sticht’s ouster from
stock of
buyback
restricted
Standard Brands purchase
Wilson’s ouster from
Robbins, Clifton S.
Robert M. Schaeberle Technology Center
Roberts, George
background and education of
The Drexel Problem and
due diligence and
in peace talks
at RJR Nabisco board meeting
second round of bidding and
Robertson, Stewart
Robinson, Edward J.
due diligence and
Robinson, James D., III
background and education of
Cohen and
Forstmann and
Johnson’s friendship with
Kravis and
management agreement as viewed by
marriage of
in peace talks
second round of bidding and
Robinson, Linda
career climb of
Kravis and
tender offer and
Robinson, Lake, Lerer & Montgomery
Rocco (Johnson’s German shepherd)
Rockefeller, David
Roehm, Axel
Roehm, Carolyne (formerly Jane Smith)
Rogers, Peter
Rohatyn, Felix
Roman, Harry
Rosen, Matthew
Finn’s friendship with
Rossoff, Mack
Rothfeld, Mike
Rothmans International
Royal Baking Powder
Rozelle, Pete
“running the books,”
Ruttenberg, Derald
Safeway stores
Sage, Andrew G. C., II
background and education of
Benevento and
Goldstone and
Johnson and
leveraged buyout as viewed by
salary of
at Standard Brands
second round of bidding and
Salem cigarettes
Saliba, Jacob
Salomon Brothers
intrigues in
leveraged buyouts and
in peace talks
Sanford, Charles
Schaeberle, Bob
Schaedler, Bob
Schwarzman, Stephen
Sea-Land
Securities and Exchange Commission (SEC)
Seslowe, Jerry
confidentiality agreement signed by
second round of bidding and
Shaw, Bill
Shearson Lehman Hutton
commercial banks and
Forstmann Little & Co.’s talks with
Good’s raiders and
Kohlberg Kravis Roberts & Co. in peace talks with
leveraged buyouts and
Project Stretch and
second round of bidding and
Sheinberg, George
Sheller-Globe
Shepard, Stephen
Shore, Dinah
Siegel, Martin
Simon, Melvin
Simon, William
Simpson, O. J.
Sinatra, Frank
Singer
Skadden, Arps, Slate, Meagher & Flom
bids delivered to
Smith, Jane. See Roehm, Carolyne
Smithburg, Bill
Smoking. See also Cigarettes; Tobacco industry
Smooth ’N Easy
Solomon, Peter
Solow, Mark
Southland Corporation
Spangler, Clemmie Dixon, Jr.
Spatt, Robert
Special committee. See also specific members
auction extended by
bid consideration meeting of
The First Boston Group and
formation of
Forstmann’s bidding group and
joke bids and
restructuring plan and
second round of bidding and
Spoor, Bill
Sprague, John
Staley Continental
Standard Brands. See also Nabisco Brands
boat people incident at
Johnson’s transformation of
Nabisco merger with
new products of
veterans of
Weigl’s ouster from
Standard Brands Canada
Starr, Reginald
Stern, James
leveraged buyouts and
Sterngold, James
Stern Metals
Sticht, Ferne
Sticht, J. Paul
Atlanta move and
background and education of
Johnson and
named chairman of RJR Nabisco
ouster of
Spangler and
successor to
Stock
Nabisco Brands
Philip Morris
PIK
RJ Reynolds Industries
RJ Reynolds Tobacco Company
RJR Nabisco
restricted
Standard Brands
Standard Brands’ purchase of
Stern Metals
Stock market crash (1987)
Stokes, Colin
Storer Communications
Strauss, Bonnie
Strauss, Thomas
The Drexel Problem and
Kravis’s conflict with
in peace talks
Strong, William
Stuart, Scott
Sustana, Ron
Swenson, Gary
T. Eaton
Tax law
Team RJR Nabisco
Tender offer
leak of
Terry, Luther
Texaco
Thatcher, Margaret
“This Week with David Brinkley,”
Time
Tobacco industry. See also Cigarettes; Philip Morris; RJ Reynolds Tobacco Company
lawsuits against
RJR Nabisco’s image connected to
Tombstone advertisements
Tomlinson, Roy
Tonabe, Bunichiro
Travelers
Truesdell, Richard
Trump, Blaine
Trump, Donald
Trump, Ivana
Trustbusting
Ueberroth, Peter
Uneeda Biscuit
Ungeheuer, Frederick
United Airlines
Vantage Pro-Am
Volcker, Paul
Von Arx, Dolph
Wachovia Bank & Trust
Wade, Charley
Wake Forest University
Waldron, Hicks
Wall Street Journal, The
Walter, Jim
Ward, Chuck
Warner, Rawleigh
Wasserstein, Bruce
in The Group
resignation of
tender offer leak and
tender offer suggested by
Wasserstein Perella & Co.
Wassong, Larry
Waters, Steve
Good and
/>
Johnson and
leveraged buyouts and
Watson, Stuart
Webster, Alex
Weigl, Henry
Weill, Sandy
Weinberg, John L.
Weinstock, Davis
Welch, James
Beck and
Welch, John
Westcott, Jim
Whitaker, John
Williams, J. B.
Willkie Farr & Gallagher
Wilshire Associates
Wilson, J. Tylee
Bagley’s meetings with
Horrigan and
Johnson and
Kravis’s talks with
ouster of
process and procedure of
at RJ Reynolds Industries
in RJ Reynolds Industries succession struggle
Wilson, Pat
Winston cigarettes
Winston-Salem, North Carolina
Winston-Salem Journal
Winthrop Stimson Putnam & Roberts
Wood, Neil
Zimmerman, Michael
Zipkin, Jerome
Zoeller, Fuzzy
Zuckerman, Howard
About the Author
Bryan Burrough and John Helyar are former reporters for the Wall Street Journal. Bryan Burrough is now a special correspondent for Vanity Fair and is also the author of Dragonfly and Vendetta. He lives in New Jersey. John Helyar is a senior writer for Fortune magazine. He is also the author of Lords of the Realm: The Real History of Baseball, named on of the top 100 sports books by Sports Illustrated. He lives in Atlanta.
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Copyright
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* Dr. O. C. Adams did not agree to speak to the authors about Ross Johnson, his client’s chief executive, until Johnson had consented.
* Only later would Johnson and Wilson learn, to their embarrassment, that one of the investment bankers involved in the negotiations was funneling inside information to the arbitrager Ivan Boesky, who fueled the run-up by loading up on Nabisco stock.
* In early 1987 Drexel Burnham and Michael Milken came under federal investigation for violating securities laws as part of the Ivan Boesky insider-trading probe. Drexel ultimately settled sweeping charges of wrongdoing with prosecutors in December 1988; Milken was indicted the following spring.
* Johnson denies the trip was made just for the dog.
* Shepard denies the magazine was influenced by company pressure, saying any changes in the story were the result of normal editing.
* Nor could he reach Andy Sage, who stopped returning Beck’s calls after Johnson began looking at the possibility of an LBO. “I couldn’t tell the truth,” said Sage, “and I didn’t want to tell him a lie.”
* Lou Roberts died in 1977.
* In September 1989, Bilzerian was convicted of numerous securities law violations and sentenced to four years in prison. Shearson wasn’t accused of any wrongdoing.
* Cohen later froze Peter Solomon out of the RJR Nabisco deal. He made the decision, Cohen later said, after Andy Sage demanded it. Incensed, Solomon fled the city for a New York Yankees fantasy baseball camp. Sage denies making any such request.
* When Hill learned of the Waters call months later, the color drained from his face. “You’re kidding; I can’t believe that,” Hill said. “If I’d ever known Kravis was trying to get ahold of Ross, that would have totally changed our strategy. It would have had a lot of significance.” Alone among Johnson’s strategists, Peter Cohen insists he never doubted Kravis would contest their bid.
* In addition to Johnson and Horrigan, the group included Sage, Henderson,
Ed Robinson, John Martin, and Vice Chairman Jim Welch.
* Johnson doesn’t remember this exchange.
* Goldberg joined First Boston in 1989.
* Kravis denies having told Cohen and Hill he had to be involved in a deal for RJR Nabisco. Newspapers reported that Kravis vowed to protect his “franchise,” a word Kravis denied having used.
* Wasserstein says he doesn’t recall this conversation, but says it is “perfectly plausible…. We basically deferred to Morgan Stanley on the fee discussion. You’re better off talking to Eric.” Gleacher says he doesn’t recall the conversation.
* Forstmann had been a sometime escort of Carolyne Roehm’s before her marriage to Kravis. A friend of her first husband’s, he had been an usher at Roehm’s first wedding. Roehm insists she and Forstmann were “just friends.”
* Forstmann denies attempting to mislead Kravis by heading for the wrong elevator.
* Wilson denies being the source of the leak.
* Both Michigan and Massachusetts ultimately declined to back Kravis in the RJR Nabisco deal, citing RJR’s investments in South Africa.
* Cohen recalls having taken a less combative stance; this version is largely Beattie’s recollection.
* “If I thought they were, I would take out my knives and kill them personally,” Goldstone said later. “It would be one of the stupidest moves in all of Wall Street history.”
* They spoke to Smith Bagley, but the effort went nowhere.
* The big restricted-stock grants actually engendered almost as much ill will in the ranks of tobacco’s management as Nabisco’s. While the top executives had gotten generous restricted-stock grants, many other managers had been browbeaten in August into surrendering their stock options. The company had offered to buy in options for $53.50 a share; the decision was supposed to be up to each employee. But Ed Horrigan spread word that everybody had better tender their options. Those who did lost big when the stock leapt weeks later. He wasn’t out to cheat anyone, Horrigan later maintained, noting he had tendered options on 59,000 shares himself. On the other hand, he was receiving 50,000 shares of restricted stock at the same time.
* During the early days of the deal, Hamish Maxwell had at least one conversation with Ross Johnson about a Philip Morris–RJR Nabisco combination. Johnson would later say he never expected Maxwell to generate any real enthusiasm for an RJR bid. Any merger agreement would almost certainly have been blocked on antitrust grounds.
* Jerry Seslowe wasn’t the first to bring RJR Nabisco to Jay Pritzker’s attention. Through a number of intermediaries, Smith Bagley had succeeded in talking with one of the investor’s aides. Nothing came of it.
* Wasserstein denies this, saying he saw no reason to be part of “the technical team” sent to Skadden Arps that morning.
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