The Protégé Read online

  “Hush-Hush?” O’Brien piped up. “The intimate-apparel company?”

  “Yeah, that’s it,” Wright said.

  “What’s the deal?”

  “We’ve got the inside track to buy it. I have a friend in senior management who can help us ink it.” Wright nodded at Gillette. “I spoke to Christian about it earlier. He likes it.”

  “What I said was, you should get more information,” Gillette reminded the younger man, irritated that Wright had jumped the gun and was trying to make people in the room think he was already on board.

  “I’ll vote against that investment on principle alone,” Maggie spoke up. “I don’t care how great a deal it is. Their catalog is basically a porn magazine. It’s insulting to women.”

  “If it’s so insulting,” Wright shot back, “there must be a lot of women who like being insulted. Hush-Hush is growing at over eighty percent a year, and—”

  “I don’t care how fast it’s growing,” Maggie interrupted. “It’s not something we should get into.”

  “Hey, just because you don’t care about looking sexy doesn’t mean the rest of the female world doesn’t—”

  “David.” Gillette’s sharp rebuke cut Wright off instantly.

  Maggie glared at Wright for several moments, then turned to look at Gillette when Wright didn’t look away. “Besides, it’s the fashion business,” she said, her voice cracking with anger. “There can be big revenue swings.” She took a deep breath. “Christian, for Everest to make an investment, you and all four managing partners have to vote yes. I’m telling you right now, I’d vote no. So we can all save ourselves a lot of time by cutting off this discussion right now.”

  Gillette folded his arms over his chest. Maggie was right. Buying any fashion business was risky, especially one like Hush-Hush. But he didn’t appreciate the way she’d tried to take control of the meeting. “Let me remind you,” he said, “the chairman of this firm can overrule any single negative vote. Got that?”

  She nodded quickly, understanding what he was saying—so much more than that he might overrule her if she chose to vote against the investment. “Yes.”

  Gillette looked back at Wright, irritated. “David, you know you’re supposed to talk to Nigel before you bring up something like that.”

  “But I thought—”

  “David.”

  Wright’s gaze fell to his lap. “Sorry.”

  “YOU GIVE David Wright a lot of fucking rope,” Faraday muttered as he sat down in front of Gillette’s desk.

  It was six-fifteen. The managers meeting had broken up ten minutes before, and Gillette was checking out a story on the Internet. He put his shoes up on the desk and locked his fingers behind his head. “David’s a star, easily our top managing director. We both know that. He deserves some extra rope.”

  “Not as much as you give him.”

  “He’s a thoroughbred.”

  “He’s cocky as hell.”

  “He’s young, he’ll mellow with age. You and I can help him with that.”

  “Some of the other managing directors are grumbling.”

  “About what?” Gillette demanded, dropping his shoes to the floor. “Making a million dollars a year?”

  “There’s more to it than just the fucking money,” Faraday retorted. “People around here are like puppies, okay? They don’t like it when you pay a lot of attention to one person.”

  “Tell the whiners to find some investments for us,” Gillette suggested. “Right now, David’s the only managing director who does. We’ve already bought two companies he found, and now he’s got us in the hunt for Hush-Hush. Which despite Maggie’s objections might be a good deal. It’s three hundred million in revenues, growing like mad, too. And I think you told me once you know people at some big apparel company in Paris. Your family is friends with the CEO’s family, right?”

  Faraday nodded, understanding immediately where Gillette was headed. “That’s a good idea, I’ll get in touch with him.”

  “He’d probably salivate at the chance to own Hush-Hush,” Gillette pointed out. “You know, increase his presence in the U.S. with a hot brand.”

  “Sure.”

  “It’ll be an easy flip. We grab this thing quick, before other people find out it’s on the block, then sell it in a few months for a couple-hundred-million-dollar gain. If it works, it’ll be thanks to David.”

  “Yeah, but—”

  “And remember, David’s the one who got us in to see the California Teachers Pension,” Gillette reminded Faraday. “The people who made that six-hundred-million-dollar commitment this morning. At one percent, that’s six million a year of income for this firm. That ain’t chump change.”

  “His fucking father got us in to see them.”

  Wright’s father was a senior investment banker at Morgan Stanley. He’d introduced Faraday to the executives of the West Coast pension fund several months ago.

  “But David made it happen. Now we have a great relationship with one of the biggest institutional investors in the country. Hell, they could have committed a couple of billion to us if they wanted. And they will next time around, to Everest Nine.”

  Faraday shook his head. “Christ, the ink isn’t even dry on the Everest Eight subscription agreements and you’re already thinking about Nine.” He smoothed his tie. “Can I ask you something?”

  Gillette heard an unusual tone in Faraday’s voice. “What?”

  “Was Maggie on point today?”

  “About?”

  “She didn’t spin it out all the way, and frankly, I don’t blame her. God, you looked like you were going to bite her head off when she started talking.”

  “You mean the Laurel Energy thing?” Gillette asked. “Giving the sell-side mandate to Morgan Stanley?”

  “Yeah. Was that payback for David’s father introducing us to the California Teachers Pension? Was she right?”

  “Morgan Stanley will do a great job for us. I’m confident they’ll get us five billion for Laurel.” Gillette raised one eyebrow. “But if I can show appreciation for a favor at the same time and give them an incentive to do us more favors, well, that’s just good business.”

  “Laurel Energy is so important to—”

  “Enough.” Gillette checked a stock price on his computer. “I’m thinking about promoting David to managing partner.”

  Faraday groaned. “But he’s only thirty-one.”

  “He’s on seven of our boards, five with me. I’m chairman of those companies, but he basically runs the quarterly meetings. He does a great job, too. Nobody on those boards seems to care that he’s thirty-one.”

  Faraday exhaled heavily. “I guess it’s better to promote from inside; at least you know what you’re getting.” He looked up. “But I don’t think it would be a good idea to promote him, then send him to L.A. to open the office. We need to see how he does as a managing partner first.”

  “Agreed.”

  Faraday chuckled. “Can you imagine letting him go to L.A., what with all that beautiful, barely dressed tail running around, right after we promote him to managing partner? Jesus, we’d never be able to find him. Neither would his wife.”

  “I said, I agree.”

  “I just don’t want you changing your mind over a game of pool with him. David can be very convincing.”

  “Won’t happen.” Gillette thought back to this morning when he was coming out of the conference room and he’d run into Wright. “Has David seemed a little off lately?”

  “What do you mean?”

  “Preoccupied. Subdued. Not himself.”

  Faraday hesitated, thinking. “No, I haven’t noticed anything.”

  “I hope he’s all right. I always worry that our top people are being wooed away.”

  Faraday’s expression soured.

  “What is it?” Gillette asked. He could tell that Faraday had started to say something but stopped.

  “Nothing.”

  “Come on, Nigel.”

 
; Faraday fiddled with his tie for a moment, then dropped it on his shirt. “David Wright,” he mumbled. “Are you grooming him to take over Everest when you leave?”

  Gillette looked at Faraday hard for a few moments. “Every organization needs a succession plan.”

  “Why not me?” Faraday asked quietly. “You know I’m committed, and after all, I am second in command.”

  Gillette hesitated, thinking about whether or not to get into it. He needed Faraday to stay committed, and you had to be careful about how people would react if you were candid with them. Faraday might check out mentally if he thought he’d hit a ceiling. At the same time, you couldn’t string someone along. Not someone as loyal as Nigel. Gillette took a deep breath. There were always so many major issues swirling around. So many split-second decisions he had to make.

  “You’re a hell of a money raiser, Nigel, and you’ve really come through for me over the last ten months as far as the admin side of the firm goes. But you don’t have any deal experience,” Gillette said gently. “You don’t know how to find companies for us to buy, how to structure deals, or how to run the companies after we buy them.”

  “I can learn.”

  “That’s a lot to learn.”

  “Listen, I’m—”

  “Let’s talk about Apex,” Gillette interrupted.

  Faraday hung his head, as though Apex were the last thing he wanted to talk about. “Not again.”

  “Yes,” Gillette said strongly, “again.”

  “But we already have twenty-two billion to put to work now that you’ve got the Wallace Family in the corral. Do you really want more?”

  “I always want more.”

  “And,” Faraday kept going, “with Apex, we’d be inheriting more fucking problems. Why would you want to do that?”

  Apex Capital was another large Manhattan-based private equity firm that owned twenty-two companies and had another five billion of dry powder—equity commitments from investors to buy more companies. Until last year, Apex had been run by a self-made moneyman named Paul Strazzi. But Strazzi had become the second casualty of Miles Whitman’s war of desperation. Strazzi’s fatal error: making a play for Everest, too.

  Since Strazzi’s murder, Apex had been run by a man named Russell Hughes, who couldn’t fight his way out of a wet paper bag. Hughes looked the part—tall and dark, with sharp facial features, like Gillette—so he made a good first impression. But he couldn’t make a decision to save his life. He put off everything, and the lack of leadership was severely affecting Apex. The firm had made only one investment under Hughes, and several of the portfolio companies had run into trouble over the last six months because he’d hesitated to replace incompetent executives. Apex was vulnerable, and Gillette knew it.

  “We can pick Apex off cheap,” Gillette said. “All we have to do is pay the general partners par, what they originally put in. Then we’ve got five billion more of dry powder and twenty-two more companies, several of which we could combine with our portfolio companies. By doing that, we’ll pick up big savings axing back office jobs and getting more purchasing power with suppliers. I think I can clean up their dogs fast, too. I’ve looked at them, and I don’t think they’re beyond repair. If we fire a few of the execs and replace them with people we know, we can save them. But the most important thing is to get that five billion of unused equity. At that point, we’d have twenty-seven billion dollars of equity. Then we’ll lever that twenty-seven with debt from the banks and insurance companies that are all over us to partner with them. I’d say we could get at least four times, wouldn’t you?”

  Faraday considered Gillette’s guess. “That’s probably right.”

  “Four times would be almost a hundred and ten billion dollars. Combined with the twenty-seven of equity, we’d control over a hundred and thirty-five billion of capital.”

  “How do you know we’d be able to get Apex so cheap?” Faraday asked.

  “I spoke to Apex’s controlling general partner. They hate Russell Hughes. They’d sell to us in a heartbeat if we offer par because they figure if he stays at the top, the family’s money isn’t going to be worth anything.”

  “Why don’t they just replace Russell?”

  “That would confirm to everyone in the financial world that Apex is in chaos. It would be impossible for them to raise any more funds, and who wants to be bought by a private equity firm in chaos?”

  “I see what you’re saying.”

  “So they’re stuck with Russell,” Gillette continued, “unless I show up. And I think I can get them to approve this thing fast.”

  “I bet you could,” Faraday agreed. “How much would it cost?”

  “A billion. It would have been a lot more a year ago, but Hughes has driven the thing into the ground.”

  “Would you collapse Apex into Everest after we bought it?”

  “No. Not at first, anyway. I wouldn’t give those people the opportunity to benefit from all the money you’ve raised. That wouldn’t be fair.”

  “Good.”

  “Down the road, I might. Once you and I figure out who the keepers are over there.”

  “How are you going to do this? Who are you going to approach first?”

  “Next week I’m meeting with Russell’s largest limited partners, the institutional investors. I’m going to explain what I want, get their buy-in, and ask them to contact Russell and urge him not to fight us. Then I’m going back to the general partner, the Strazzi estate, to make a formal offer. After that I’ll get a couple of the Apex managing partners in a room and make them an offer, too. Obviously Hughes won’t want to sell his stake, but if I have everyone else in my corner, he won’t have any choice.”

  “You’ve got it all figured out, don’t you. Hughes is a dead man and he doesn’t even know it.”

  “That’s the way it has to be.”

  “You get what you fucking want, don’t you, Christian.”

  “Usually. And one thing I want is you to watch your mouth.”

  Faraday raised both eyebrows. “Huh?”

  “You don’t even know you’re doing it, do you.”

  “Well, I . . .” Faraday’s voice trailed off.

  “Like I told you before, I don’t care if ‘fuck’ is every other word when you and I are one-on-one like this, but I don’t want you saying it in front of others in the office, especially the women.”

  “When did I—”

  “This morning, okay?”

  Faraday groaned. “Well, excuse me for getting excited.”

  “I don’t care if you get excited. I don’t even care if you do that silly dance you did in the hall this morning, which by the way has to be one of the most embarrassing things I’ve ever had the misfortune of witnessing. Just don’t drop the F-bomb in public anymore.”

  “All right, all right.” Faraday started to get up, then dropped his pudgy form back into the seat. “Is Allison Wallace qualified to be a managing partner at Everest Capital? Did you check her out?” he pushed. “I mean, it’s great to add another five double-large to the new fund, but I don’t want deadwood walking around here. Especially deadwood as pretty as her. She’ll be a big distraction.”

  Gillette sighed. It seemed he was always pushing things uphill. “When did you see her?”

  “When she was walking out this morning, after you met with her. How could I miss her? The whole office stopped to look.”

  “Give me a break.”

  “Legs up to her neck and a short little skirt to show them off,” Faraday said smugly, holding one hand below his chin.

  “Her skirt wasn’t short. She was dressed very conservatively.”

  “Yeah, maybe you’re right.” Faraday chuckled. “But the important question is, does she have game or is she where she is just because of all the money? Even more important, are you letting her in here to get into her piggy bank or her panties?”

  “Maybe both.”

  “At least you’re honest.”

  “Oh, come on, N
igel. You know me better than that.” Gillette’s tone turned serious. “I’d never do something like that.”

  “I know.”

  “Hey, she’s on the board of the family trust with her uncle and her grandfather. There’s plenty of others in that generation of the Wallace Family they could have put on the board. She’s qualified.”

  “Did you call Craig West?”

  “As soon as Allison was out the door this morning,” Gillette confirmed. “Craig called me back before we went into this afternoon’s meeting. Allison went to Yale undergrad and Chicago’s business school. You don’t get much better than that.”

  “But what fucking university isn’t going to accept her? Think about what she probably donates to those schools every year.”

  “She was top of her class both places.”

  “Really?” Faraday hesitated. “Did she go right to the family trust after business school?”

  “No, Goldman Sachs after Chicago. Same department I was in before I came to Everest. There’s still a couple of guys over there I know. They said she was good. Said she didn’t try to shirk anything because of who she was.”

  Faraday held up his hands. “Okay, okay. You convinced me. But she will be a temptation.”

  “I’m still with Faith. You know that.”

  “Ah, yes, the lovely Miss Cassidy. Do I hear wedding bells?”

  Gillette glanced out the window into the fading late afternoon light of midtown Manhattan.

  Faraday let it ride for a few moments, then gave up, rising from his chair with a groan and heading toward the door. “I’m going downstairs to get some mint chocolate chip,” he announced. “Nothing like a little instant fucking gratification.”

  “You better start watching your weight,” Gillette called after him, grabbing his computer mouse.

  “What are you, my father? First I have to watch my mouth, now I’ve got to watch my weight. Oh, Jesus.” Faraday snapped his fingers and turned around as he reached the door. “I meant to tell you, Christian.”