Michel David-Weil, the last emperor of finance, retired

Michel David-Weill, who died on Thursday evening in New York at the age of 89, left a mark on the history of Lazar and the business world like few French actors. “Michel ran Lazar with unerring firmness,” the investment bank he ran from 1975 to 2001 said Friday. His inspiration, his leadership and his vision define Lazar today. He is to be buried in the Montparnasse Cemetery in Paris, along with the families of the bank’s main partners.

A direct descendant of Alexandre Weill, who left for the United States in 1856 to join Lazard Frères, Michel David-Weill managed to unite branches in New York, Paris and London under one roof, making the family investment bank an important pillar of French capitalism, but also transatlantic . The influence of this patron and art collector, born to a Jewish family before baptism and raised in the Catholic faith, went far beyond the financial world, as evidenced by the numerous tributes caused by his death. “The President of the Republic salutes a visionary player in the economic world who has lavished his talents and his gifts on our French companies, our heritage and our art,” the Elysee Palace said in a press release. Looking back at six key moments in an extraordinary life and career.

His first touches of brilliance

It is difficult to generalize the path of this heir, who is sometimes presented as the “Sun King” of finance, who divided his life between Paris, New York, London and his possessions, including his villa “Lee” at Cape d’Antibes, where in the summer he took the cream of business, politics and art. Born November 23, 1932, son of Pierre David-Weil and Bertha Haardt. He studied at the Lycée Française in New York, then at the Paris Sciences Po before joining the bank in 1956. This is André Meyer, one of the most brilliant bankers. a member of his generation, nicknamed “Financial Picasso”, who introduced him to American affairs.

Portrait of Lazard bank director Michel David-Weill, October 4, 1968.

Portrait of Lazard bank director Michel David-Weill, October 4, 1968. KEYSTONE-FRANCE

His baptism of fire? Hostile takeover of Lazard Frères in 1964 by Franco Wyoming, a company with oil assets in France and the United States. The daring operation will shock New York City, but its success will inspire Michel David-Weill. Returning to Paris, four years later he advised the small Lyon glassmaker Boussois-Souchon-Neuvesel (BSN) when it filed a hostile takeover bid for Saint-Gobain, five times its size.

The operation, which will divide the Parisian elite into ancient and modern, ends in failure. But it spawned a business relationship and an enduring friendship between Michel David-Weil and BSN president and future Danone founder Antoine Riboud. It will also establish the authority of the heir in the face of associates with such recognized personalities as Antoine Bernheim, Felix Rogatin or Bruno Roger.

Beginning of the reign

After the death of his father Pierre David-Weill in 1975, Michel took over as president of Lazard Paris and two years later as president of a bank in New York. André Meyer died in September 1979. In a movie-worthy scene described by Martine Orange in her book These Gentlemen of Lazare (Albin Michel, 2006), Michel David-Weil uses his mentor’s funeral in the Montparnasse cemetery to get close to Sir Jan Fraser. president of Lazard London, convergence of the three houses.

In the procession, bank members do not believe their eyes, the journalist says. Michel David-Weil is in the process of assuming power without losing a second… “behind the coffin of André Meyer.” “I’m the boss because I’m not afraid,” a man who said he was fascinated by Louis XIV’s seizure of power later explained in an interview.

The Lazard heir is not an exceptional banker, but he knows how to use his address book and his political acumen to continue to grow the bank, which became one of the world’s merger leaders in the 1980s. and business advice. Michel David-Weill inherited his nickname “the last emperor of Wall Street” during this time.

“Ministry of Industry”

The 1986 cohabitation opens a new era for Lazard and its CEO. Prime Minister Jacques Chirac and his Economy and Finance Minister Edouard Balladur are launching a big wave of privatizations. And the prestigious investment bank, which, unlike its rivals Paribas and Rothschild, managed to avoid the nationalization movement, knows how to use it.

Investment banking is the management of individuals. All of Lazar’s partners were exceptional. To choose meant to kill. It would mean giving up the virtues of everyone else.

Michelle David Weil

Associated with all the major privatizations, including the first and most emblematic one, Saint-Gobain, it even became a “second ministry of industry,” as Martine Orange writes in her book. “No deal, no capital raise, no move” was not without Lazar, who will also pilot Renault’s capital opening and France Telecom’s IPO. Between 1986 and 1988, the bank’s profits in France tripled.

Also in the 1980s, Lazard, under Michel David-Vail, was involved in building the industrial empires of Bernard Arnault, François Pinault and Vincent Bolloret and their fortunes. The bank is developing, thanks to Antoine Bernheim’s financial ingenuity, a cascading holding system that allows a major shareholder to control an empire at a lower capital cost. A financial innovation that will become one of the hallmarks of the house.

Talent Leak

But Michel David-Weill’s autocratic governance also has its limits. He is admittedly adept at identifying talents, often highly qualified (X, ENA, Inspection des Finance, etc.) and passed through national palaces such as Mathieu Pigas or Anne Lauvergeon. But instead of ruling, he rules by maintaining rivalry.

“We would like me to show favoritism,” said the man who hosted partners one at a time in his office every year to solemnly announce their generous bonuses. I have always refused. Investment banking is the management of individuals. All of Lazar’s partners were exceptional. To choose meant to kill. It would mean giving up the virtues of everyone else. »

But in the 1990s, Michel David-Weil went through a serious departure. In quick succession, several banking stars leave the ship, forgoing massive influence and paychecks. This is the case of Jean-Marie Messier, who joined another legend of French capitalism, Guy Dejouany, in the Générale des eaux. Or Felix Rogatin, a pillar of the New York structure.

We are talking, in particular, about the coming to power of Edward Stern, the heir of the banking family of the same name and married to his daughter Beatrice. The brilliant but controversial banker was considered the direct heir of Michel David-Weill. He would leave the bank in 1997 and be killed eight years later. But the damage has been done. The outflow of talent is putting pressure on business, and the eternal rival Rothschild is gaining market share.

Battle on Imperial Street

Apparently, the deal is purely technical. In April 2001, Michel David-Weil completed the final restructuring of Lazard’s management structure. It brings together Eurafrance and Azeo to bring together three houses in Paris, New York and London. This is the birth of Eurazeo, an investment company that owns a 17% stake in Lazard and shares in Generali, Mediobanca and Danone.

But this operation is, first of all, the epilogue of the showdown, which the “emperor” almost lost. Fight against Vincent Bolloret, who, with the help of Antoine Bernheim, noticed a flaw in the management structure. Within months, the businessman, with the tacit backing of several investment funds and the Swiss banking giant UBS, bought shares in Rue Impériale de Lyon, the parent holding company of the Lazar galaxy. As a result, he holds 31% and is in a strong position. It is Credit Agricole that will come to free the patriarch by buying his shares from Vincent Bolloret for almost 4 billion francs, about double his original investment.

No matter what happens next, I can never get rid of the idea that this house is mine.

He won’t think about leaving Eurazeo before the financial crisis. The full withdrawal of Crédit Agricole from Eurazeo in 2017 will trigger a new raid, that of competitor Tikehau. A new long-term investor, the Decaux family, comes to power and buys shares in the green bank.

Wall Street entrance, final battle

“They are going to kill Lazard. Michael is crazy. He allows them. In the fall of 2004, Antoine Bernheim, the former kingmaker of European capitalism and ex-Lazar associate, did not want to believe that Michel David-Weill had allowed Wall Street icon Bruce Wasserstein to entrust the fate of the powerful family investment bank. in the hands of the stock exchange.

This is the red line that the monarch of finance has always put: “The Bank is not listed and will not be,” he said in 2000. But to this dolphin, who has just sold his Wasserstein Perella boutique to Germany’s Dresdner Bank, Michel David-Weill will give up everything to convince him to write the rest of the investment bank’s story and put him on the throne. Until the first wants to completely oust the second.

Thanks to lavish bonuses and costly star recruiting by Bruce Wasserstein, Lazard is caught by the throat and records the first losses in its history. You have to raise capital, insists the new owner of Lazard, who knows the listing is also a way to erase the bank’s family DNA. “To quote a house is to involve it in a simplification,” Michel David-Weil counters. The transfer of weapons inside the house is becoming more and more violent.

Bruce Wasserstein (center podium) during the presentation of Lazard Bank at the New York Stock Exchange, May 5, 2005.

Bruce Wasserstein (center podium) during the presentation of Lazard Bank at the New York Stock Exchange, May 5, 2005.HO/NYSE/AFP

“I will make you rich,” Bruce Wasserstein promises his partners, contrasting the “employees” of the bank with the “capitalists” who own it and receive generous dividends annually. The investment bank goes public on May 5, 2005. The family dilutes and the American banker becomes the sole owner of the board for only a short time. He died suddenly of a heart attack four years later.

For Michel David-Weill, it was time to move on from Lazar. He then returned to Eurazeo, where he served as Chairman of the Supervisory Board until last April, helping to turn it into a thriving investment company. But, in his opinion, the connection with the bank, which he helped raise to the top, will never really end, as he admitted in 2005: “No matter what happens next, I can never get rid of the idea that this is my home. . »