True Greed: What Really Happened in the Battle for RJR Nabisco
The rival account, published months after Barbarians.
Summary
The reference has not verified this book in detail; the summary states only what the title, author and subject establish.
Hope Lampert wrote this account of the RJR Nabisco leveraged buyout of 1988, published the same year as Bryan Burrough and John Helyar's Barbarians at the Gate and covering the same events.
The transaction remains the largest leveraged buyout of its era. Ross Johnson, RJR Nabisco's chief executive, proposed a management buyout at seventy-five dollars a share with Shearson Lehman Hutton, which triggered an auction. Kohlberg Kravis Roberts bid against him, a third group formed around First Boston, and the board's special committee ran a process that concluded with KKR winning at roughly a hundred and nine dollars a share, or about twenty-five billion dollars.
Lampert covers the personalities, the management group's proposed terms which would have given the executives an extraordinary share of the equity, the board's response, the investment banking fees, and the financing structure. Burrough and Helyar's account is more detailed and better known, and became the standard version. Lampert's is shorter and reaches similar conclusions. The reference has not verified this book's specific contents beyond the events it covers. Readers wanting the definitive narrative should go to Barbarians at the Gate; readers wanting the analytical treatment of what leveraged buyouts do should go elsewhere entirely.
Key takeaways 6
- The management buyout proposal triggered an auction that raised the price by roughly forty-five per cent above the initial bid.
- Management's proposed equity terms would have given a small group of executives an extraordinary share of the resulting company.
- A board that receives a management buyout proposal faces a conflict that only an independent process can resolve.
- Investment banking fees on the transaction were enormous and were paid regardless of which bidder won.
- The winning bid at roughly a hundred and nine dollars a share reflected auction dynamics rather than an independent valuation.
- Burrough and Helyar's account of the same events is more detailed and became the standard version.
Who should read it
Readers of the RJR Nabisco transaction who want an alternative contemporaneous account, though the better-known version is more complete.
Similar books 6
Chosen by shared topics, the entries that hold them, and the people who recommended both.
The 1988 bidding war for RJR Nabisco, the largest leveraged buyout to that date.
Recommended by: Jim Collins, Mohnish Pabrai and 1 other
Academic and broadly favorable.
Recommended by: Mohnish Pabrai
Authorised 150-year corporate history
Steve Ross's path from funeral homes and parking lots to the Time Warner merger.
Recommended by: Mohnish Pabrai, Charlie Munger
Goldman Sachs from Marcus Goldman to the 2008 crisis, from internal documents.
Recommended by: Mohnish Pabrai
Where it sits in the reference 2
Topics