Word: drexel
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Dates: during 1990-1999
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...aware of how fast the end came last month for Drexel Burnham Lambert, wags at the brokerage firm of Shearson Lehman Hutton are in pretty grim humor these days. The latest joke making the rounds of the troubled American Express subsidiary: "What's the difference between Shearson and Drexel?" Answer: "About three months...
...Last year 68,112 U.S. firms filed for bankruptcy vs. 10,622 in 1981. And the failures are getting larger. The assets of bankrupt companies totaled $67 billion in 1989, up 52% from the previous year. The 1990 pace could be even quicker. Since January the Wall Street firm Drexel Burnham Lambert (assets: $3.6 billion) and , the U.S. retailing arm of Canada's Campeau Corp. ($9 billion) have sought protection from creditors. They joined such major companies as Eastern Air Lines and LTV Corp., the third largest U.S. steel company, which had earlier taken refuge in bankruptcy proceedings...
...bust business has attracted some unlikely saviors. Shortly before it declared bankruptcy last month, Drexel Burnham Lambert beefed up a unit that advised distressed companies. The move was viewed with cynicism by some on Wall Street since Drexel, through its junk-bond financing of buyouts, was a prime contributor to today's bankruptcy boom. Other improbable rescuers include First Boston, which advised Campeau to borrow more than $10 billion to buy Bloomingdale's, Jordan Marsh and seven other U.S. store chains. Some critics attack Wall Street firms for profiting from both the debt buildup of the '80s and the subsequent...
Among turnaround artists, the competition to advise the creditors of bankrupt companies has grown fiercer by the week. To gain the confidence of prospective clients, even the best-known advisers must often work for months without being formally hired. The day after Drexel declared bankruptcy in February, some of its major creditors sought help from Wilbur Ross, a senior managing director at Rothschild Inc., a top workout firm. Ross agreed to represent half a dozen large bondholders, who held a total of $100 million in Drexel notes, without a retainer in order to win their business. Says...
...assets: $2.2 billion). State regulators were happy someone was willing to take over the sick thrift. Paul renamed the S&L and within a few years sent its profits zooming. His method: investing CenTrust's assets heavily in junk bonds, many of which he bought from Michael Milken at Drexel Burnham Lambert. By the late 1980s the payoff from CenTrust's $1.35 billion portfolio of junk made the S&L the region's most profitable thrift. But as the market value of junk bonds collapsed in recent months, CenTrust was doomed to go with...