The last tycoons: the secret history of Lazard Frères & Co (14 page)

One day in June 1968, Supino had lunch with the Lazard partner E. Peter Corcoran. At the end of the lunch, Corcoran asked him to join Lazard. Not knowing much about the firm, but having a vague sense from being a Wall Street lawyer that it was "a dangerous place to work," Supino told Corcoran he wasn't interested. "Also," Supino said, "I told Corcoran that I had heard Felix Rohatyn was a shit. Those were my exact words. So, 'thank you,' I told Peter, 'but no thank you.'" Corcoran went back to the office after lunch and reported the conversation to Andre, including Supino's characterization of Felix. Andre's response: "You must hire him."

A month later, Supino agreed to go to Lazard, with compensation three times what he had made as a lawyer. On his first day at 44 Wall Street, which he described as a "very serious place" but also "very dismal, bare with drab walls," he wondered to himself, "Now what? What am I going to do?" He quickly figured out "you had to invent what you were going to do." One of his first assignments was to write a white paper on why synergy was good for corporate America, in effect a massive justification for the merger activity that Lazard was facilitating and dominating.

A few years later, Andre asked Supino to go help fix a company, Republic Intermodal Corporation, in Lake Success, New York, in which Lazard had an investment. Supino was "seconded" to Republic for two years, turned the company around, and arranged for its successful sale. Before the sale closed, Andre summoned him to the Carlyle.

"I went to the Carlyle and up to Andre's suite," Supino recalled. "I walk into one of the libraries and see partners Frank Pizzitola, Tom Mullarkey, Peter Corcoran, and Andre. I walk in and see all these faces facing me, and Andre says, 'So, David, tell me what you are going to do now that we are selling Republic?' And I said, 'Mr. Meyer, I've given that no thought at all. Mr. Meyer, I am just trying to get this deal closed.' 'Well,' he said, 'why don't you come back to Lazard and we will pay you some thousands of dollars plus a bonus?' And I said, 'Well, I don't think I can do that, Mr. Meyer. I am sorry but I've been associated with Lazard for six years, and if you don't know by now whether I'm partner material or not, you'll never know.' And, anyway, I told him, 'Who knows? The deal may not close, so I may have to stay at Republic.' And he got furious at me, absolutely furious in front of all these other people. So he started shouting at me. 'You are an arrogant, brash young man!' And he said, 'Look, you go talk to my partners. I did not decide this. My partners decided this.'"

About a week later, Supino remembered, Andre called him up and asked him to come to the Carlyle at 10:00 the next morning. One "always had fear and trembling going to see him," Supino said, but he duly appeared at the appointed hour. "I went back to the Carlyle, and this time there was nobody there but Andre," he recalled.

"It is good to see you, David," Andre said. "How are you?"

"Very well, Mr. Meyer," Supino responded.

"David, I have decided I would like you to come back to Lazard as a partner," Andre said.

"Oh, Mr. Meyer," Supino recalled saying. "Enormous honor, Mr. Meyer. Enormous honor."

"Yes, I would like to give you a 1 percent interest," Andre continued.

"I said, 'Mr. Meyer, whatever you say is perfectly acceptable,'" Supino recalled. "'You could give me a quarter of a percent. It is a great honor to become a partner of Lazard.'" Supino got his 1 percent share of the profits.

FELIX WAS UNQUESTIONABLY Andre's protege, a mantle he assumed with less and less angst as Andre's health deteriorated throughout the 1970s and as it benefited Felix more and more in the marketplace. They spoke French to each other, even in New York. No one else at Lazard ever came close to achieving the level of intimacy Felix had with Andre--and those who tried quickly came to regret the attempt. "In some sense, Felix
was
Andre's son," explained one partner. "They had a very close and very frank relationship." Andre's obituary mentioned Felix--and Felix alone--as his heir apparent. What Felix was able to accomplish as an adviser requires the proper homage to Andre. Andre was said to have loved three things only: stunning women, priceless art, and complex deals. When asked about this, Andre told a reporter, "The first two are really one and the third is not always the case." The sort of service Meyer provided to his clients differed from that of Felix. Meyer saw himself as much more of a principal than as an adviser. True, he was the ultimate confidant, of David Rockefeller, William Paley, David Sarnoff, and Jackie Kennedy among others, but he saw them as peers, and they saw him as charming, effervescent, and exotic.

Meyer's introduction to the First Lady came through Stephane Boudin, the diminutive Parisian interior designer and head of Jansen, who worked with them both. "He was a great womanizer," said Paul Manno, Boudin's New York representative. "Boudin and I went to see him and said, 'How would you like to meet Jacqueline Kennedy?' His eyes popped out of his head. I said, 'It will cost you $50,000.' He said, 'For what?' I said, 'For a rug.'" At Manno's instruction, Meyer bought for the White House a nineteenth-century Savonnerie rug for the Blue Room. The introduction was made, and later Andre would become Jackie's financial adviser and close friend. In 1967, he accompanied the former First Lady to a gala at the Wildenstein gallery to raise money to help restore Italian art damaged in a flood in Florence. Arm in arm they made a grand entrance to the gallery as the paparazzi surged.

Andre was a notorious ladies' man, despite being married throughout his adult life to Bella Lehman. "Oh yes, Andre had a wandering eye," explained one of his friends. "And he made no secret of it. Even to his wife. They were almost members of the family. It was taken for granted. If the women wanted it and he wanted it, and Bella didn't object--who could make a big deal out of it." Soon after arriving in New York during World War II, he began a long romance with Claude Alphand, the wife of the French diplomat Herve Alphand. Alphand had been assigned to the French embassy in Washington at the time France fell to the Nazis and immediately left for London to join the Free French. Claude was left behind in New York, where she began a career as a chanteuse at nightclubs such as the Blue Angel. She was said to resemble Marlene Dietrich. Their affair was
"very
common knowledge," one New York socialite recalled. After the war, the Alphands got back together, and then divorced. But Herve, by now the French ambassador to Washington during the Kennedy administration, never blamed Andre. Claude moved back to New York and became a fixture at the Carlyle. "She would get away with it because he adored her," Andre's granddaughter Marianne Gerschel explained. "Absolutely adored her. She was just bohemian enough to appeal to his own sense of creativity. He enjoyed that in a woman."

Andre also had a long relationship with Henriette Bloch, another French emigree, who was the wife of Maurice Bloch. Like Alphand before him, Bloch accepted his wife's affair with Andre. "I think my grandfather was the one true man in her life," Marianne Gerschel said. "As far as she was concerned, he could do no wrong." She also became one of Bella's closest friends. And, according to Andre's grandson Patrick Gerschel, Andre had an affair with Felix's mother, which may in part explain how Andre came to know Felix. "It's very possible because Andre Meyer was quite a flirt and so it's quite possible," Michel explained. "But it's also quite possible that it's not true."

Then, of course, there was Jackie O. Andre and Jackie were together constantly during the years after President Kennedy's death and before her marriage to Aristotle Onassis. "Jackie opened up his life," Gianni Agnelli once said. "She was part of those aspects of life that he didn't really know. And he absolutely
adored
being with someone that important." She seemed taken with him, too, for a time. "His name constantly came up in conversations with her," a friend of Jackie's said. "It was always, 'I'm going to talk to Andre about this, see Andre about that.' But she never actually talked about the relationship. You just sort of knew it was there." Andre was said to have advised Jackie on the $200,000 purchase of her penthouse apartment at 1040 Fifth Avenue. And she was a frequent guest, along with Caroline and John, at Andre's suite at the Carlyle. (When the Kennedys came to New York from the White House, they stayed in the Carlyle, one floor above Andre.) The Kennedy men were also quite taken with Andre, and thanks to Sargent Shriver, he became one of the trustees of the family's vast fortune. Andre became close not only with Sargent Shriver but also with Bobby and Teddy Kennedy. "These Kennedys," he once told his friend David Lilienthal, "are difficult people to do things for. Bobby has such energy, is moving about constantly. The other evening we had dinner together on Third Avenue in a small restaurant. During the meal he had to go to put in appearances at three dinner meetings; three times."

Andre was disappointed that Jackie married Onassis, even though, in the end, he helped her negotiate their financial arrangement. "I think he was probably upset because she had really played the little girl to the hilt, OK?" Marianne Gerschel said. "And, you know, no man wants his little girl to get married--it's that sort of feeling. If you're going to play the little girl, you will always be the little girl, and therefore you're not allowed to get married. You're
not
allowed. And there's also this feeling, 'If she's going to marry somebody, why can't she marry me?' I mean it's totally illogical, but it's totally the way fathers behave." Despite Jackie's marriage to Onassis, Andre remained close to her and would often go to her parties at 1040 Fifth. But it seems unlikely he ever had an affair with Jackie. Jackie attended Andre's memorial service at Temple Emanu-El on Fifth Avenue, in October 1979. Afterward, walking home up Fifth Avenue, "she was very sad," remembered Roswell Gilpatric, a longtime Kennedy aide and friend of Jackie's. "She felt that in her life there was nobody else to take his place."

Andre also liked to mix it up with the likes of William Zeckendorf, whom he bankrolled whenever the developer was desperate for cash. Meyer and Lazard made a bundle backing Zeckendorf in the purchase and relatively quick sale of both the Chrysler Building and the Graybar Building in Manhattan. Zeckendorf and Lazard bought a 75 percent interest in the buildings for $52 million, in 1953, and sold the interest, in 1957, for $66 million, making the deal the largest in New York real estate history at that time.

Andre was also behind one of the greatest deals in the Lazard lore. In 1950, he fell in love with the complexity of trying to wrangle a massive windfall from Matador Ranch, some 800,000 acres of land in the Texas Panhandle between Fort Worth and Amarillo, on which grazed some forty-seven thousand head of cattle. A publicly traded Scottish company had owned Matador since 1882. Andre decided he wanted the whole operation, including its potential for finding oil and gas. With the Matador stock then trading at $6 per share on the London Stock Exchange, Lazard offered the Matador shareholders a whopping $23.70 per share, or just under $19 million, a premium of astronomical proportions. The massive Matador Ranch, second in size only to the King Ranch (at 950,000 acres), was some fifty-six miles across. Andre decided to divide it into fifteen separate "cattle and ranch" corporations and sell them off individually during the next nine years. Lazard even outlasted a three-year drought in the mid-1950s that almost killed off all the cattle. But in the end, after some clever tax arrangements, the for-once-patient Andre persevered, and Lazard and its investment group made between $10 and $15 million on their original investment. Remembered George Ames: "It was a monster of its kind. It started in Edinburgh, kept going in New York, and wound up in Amarillo."

In 1948, Lazard observed the firm's one hundredth anniversary, with Andre doing as little as possible to celebrate. He refused to pose for newspaper photographers and shunned all press coverage. He was simply too busy focusing on his deals to worry about anniversaries. On October 23, 1948, Andre had arranged for Lazard in New York to buy 20 percent of Les Fils Dreyfus for $153,300 directly from the founding Dreyfus family. When Henry Plessner, Felix's stepfather, then working with Les Fils Dreyfus, saw Andre in Paris at the start of the summer of 1949, he said to him, "I have this stepson who's really not very smart, but he's looking for a summer job, and it would help me if you could [help him out]."

The job, dealing with brokerage confirmation slips, paid $37.50 a week. Felix recalled, "I said to myself, 'Sure, why not? It will give me a chance to think about what I would like to do with myself.'" He worked the whole summer in the dingy offices at 44 Wall Street. Andre was not there; he spent much of each summer working from his chalet high in the Swiss Alps at Crans-sur-Sierre. The Lazard partners appreciated Felix's work and raised his salary to $50 per week, and his responsibilities shifted to valuing the accounts of the firm's rich customers every month. When Andre returned from Switzerland after Labor Day, Felix was ushered in to meet him, finally. But, as advised, he made no mention of his increase in pay. "Andre yanked me in [to his office] and said, 'I understand your pay has been increased, and I would've thought you would have had the good manners to thank me.' And I said, 'Well, Mr. Meyer, I was told not to say anything to anyone.' I thought, 'Here's the end of my career, before it starts.'"