M&A is not a job for people with convictions. If you have a strong sense of right and wrong, you're better off working for the Catholic church. M&A is a job for mercenaries who will fight for whoever pays them and saying roughly what clients want hear, subtly adjusted for market reality.
The amoral nature of the M&A banker was illustrated yesterday when a takeover target made public a series of emails that it had been sent by Robert Kindler, Morgan Stanley's global head of M&A. Allergan Inc, a U.S. pharmaceuticals company, took the unusual move of publicizing the emails it had received from Kindler as part of his pitch to represent Allergan in a hostile takeover attempt by Valeant Pharmaceuticals International. In them, he argued that Valeant is a flawed buyer. The predatory company was a "house of cards," said Kinder, "your investors should not want to take their stock." Kinder was ploughing an existing furrow: Valeant has been accused of growing solely through acquisition and investing too little in research.
It might have ended there and Kinder could have escaped with his convictions intact - had his overtures to Allergan not been refused. Instead, spurned by Allergan, Kinder went on to represent Valeant - whose business model he'd just criticized. With the assistance of Kinder, whose expertise in hostile deals is seemingly legendary, Valeant is now mounting a hostile bid for Allergan which yesterday issued Kinder's emails to discredit him. Fortunately, Valeant doesn't seem to bear a grudge: “Kindler is one of the best M&A bankers out there,” it said yesterday. “While we will have some fun with him later, he’s still very much on our team.” Such is the nature of working in M&A.
Separately, someone at Macquarie is in big trouble. The Telegraph reports that an unnamed Macquarie employee was to blame for yesterday's "cock-up" in the IPO of MySale, an Australian fashion website backed by entrepreneur Sir Philip Green. MySale was to have been listed at 226p, but its shares were instead listed as £2.26. This caused confusion and led many in the market to think that the company was trading at 2.26p. Macquarie, 'inadvertently put the price in pounds rather than pence,' says the Telegraph. The stock fell 27% as a result and is due to be changed to the correct price today. Sir Philip Green is known for having a bad temper. The guilty party at Macquarie has reason to be avoid him for a while.
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