Paine Webber

Strategic Concepts & Mechanics

Strategic PatternProcess of Bites, Not Grand Plans Decision FrameworkCash Flow Over Earnings as Debt Survival Test Relationship LeverageHighly Confident as Substitute for Actual Capital Capital StrategyInterest Deductibility as Leveraged Assault Fuel Competitive AdvantageNOL as Bidding War Nuclear Option Signature MoveSpeed-of-Sale as Debt Survival Doctrine Signature MoveLawyer as Deal Principal, Not Hired Gun Signature MoveParis Apartment Discipline Signature MoveAll Debt Disguised as Equity Cornerstone MoveBuy the Whole, Sell Everything But the Crown Jewel Cornerstone MoveBlind Pool Before the Target Exists Cornerstone MoveBribe the Gatekeeper, Storm the Castle Cornerstone MoveBankruptcy's Tax Corpse as Acquisition Weapon Competitive AdvantageTax Arbitrage as Structural Weapon Operating PrincipleProfessional Manager Decay Across Generations Risk DoctrineNever Cut Back a Committed Deal Signature MoveMilken: Four-Thirty AM Cathedral-Builder With No Office Capital StrategyVenture Capital Masquerading as Debt Signature MovePeltz: Spittle-on-the-Check Persistence from Near-Broke Signature MovePerelman: Borrowed $1.9M to a Boeing 727 in Seven Years Cornerstone MoveManufactured Credibility from Thin Air Decision FrameworkContra-Thinking as Default Mental Operating System Identity & CultureForced Savings as Loyalty Handcuffs Cornerstone MoveCash Flow Over Earnings as the Only Truth Cornerstone MoveBuy the Core, Sell the Pieces, Erase the Debt Signature MoveKingsley: Mount Everest Desk, Twenty-Year Sounding Board Signature MoveIcahn: Wrestling-a-Ghost Negotiation Until the Last Penny Cornerstone MoveOwner's Equity as the Non-Negotiable Discipline Signature MoveCultural Integration Before Operations Signature MoveRadical Acceptance in Decision Making Risk DoctrineAI Disruption Risk Assessment Cornerstone MoveTech-First Consolidation Play Decision FrameworkNon-Judgmental Concentration Discipline Decision FrameworkMeditation as Business Edge Signature MoveSpeed as Competitive Weapon Cornerstone MoveFragmented Industry Roll-Up Strategic PatternObscene Profits Industry Selection Signature MoveProblems as Value Creation Assets Operating PrincipleCustomer Dream Tech Discovery Strategic PatternBig Hairy Deal Hunting Signature MoveBig Trend Right Everything Else Wrong Operating PrincipleIntegration Math and Music Balance

Primary Evidence

"Icahn, of course, is no one’s fool. In an apparently unprecedented arrangement—and the terms were to be kept secret—Paine Webber placed $ 1 million in escrow, to be forfeited if they were unable to do the deal on the agreed-upon terms. The way the deal was structured, the $ 750 million would enable Icahn to buy out all the shareholders and also take out his investment of about $ 300 million in TWA stock. In addition to getting all his money out, he planned to take out TWA’s computerized reservation system, PARS. It would be given to the Icahn Group as a dividend, and Icahn planned to lease PARS back to TWA for ten years for an amount that would have given Icahn an annual profit of $ 25 million."

Source:The Predators' Ball

"Icahn, of course, is no one’s fool. In an apparently unprecedented arrangement—and the terms were to be kept secret—Paine Webber placed $1 million in escrow, to be forfeited if they were unable to do the deal on the agreed-upon terms. The way the deal was structured, the $750 million would enable Icahn to buy out all the shareholders and also take out his investment of about $300 million in TWA stock. In addition to getting all his money out, he planned to take out TWA’s computerized reservation system, PARS. It would be given to the Icahn Group as a dividend, and Icahn planned to lease PARS back to TWA for ten years for an amount that would have given Icahn an annual profit of $25 million."

Source:Predator's Ball

"I started United Waste Systems with my own money, followed by outside capital from placements with friends and family about a year later. I ran the company privately until 1992, when our IPO launched with the two leading banks in the waste management sector at the time: Paine Webber and Alex Brown. The public capital markets were a whole new world to me, and it allowed me to go full throttle on acquisitions, beyond the initial deals we’d completed. The timing could not have been better. Environmental regulations were forcing municipal dumps to transform into state-of-the-art landfills, and the new bond requirements alone cost millions of dollars. A lot of small landfill owners were eager to sell out and let us shoulder the capital investments. There was also an opportunity to integrate vertically with trash collection companies strapped by rising disposal fees."

Source:How to Make a Few Billion Dollars

Appears In Volumes

The Predators' Ball Predator's Ball How to Make a Few Billion Dollars