Weill, Sandy 1933–
Family: Son of Max Weill (a dressmaking-business owner) and Etta Kalika; married Joan Mosher (1955); children: two.
Career: Bear Stearns, 1955, runner; 1955–1956, broker; Burnham & Company, 1956–1960, broker; Carter, Berlind, Potoma & Weill, 1960–1962, partner, president, and CEO; Carter, Berlind & Weill, 1962–1967, partner, chairman, and CEO; Cogan, Berlind, Weill & Levitt, 1967–1970, partner, chairman, and CEO; CBWL Hayden Stone, 1970–1972, chairman; Hayden Stone & Company, 1972–1974, chairman; Shearson Hayden Stone, 1974–1979, chairman; Shearson Loeb Rhoades, 1979–1981, chairman; American Express, 1981–1983, chairman of the executive committee; 1983–1985, chairman and CEO of Fireman's Fund Insurance Company and president; Commercial Credit Company, 1986–1988, chairman, president, and CEO; Primerica Corporation, 1988–1993, chairman and CEO; Travelers, 1993–1995, chairman and CEO; Travelers Group, 1995–1998, chairman and CEO; Citigroup, 1998–2000, co-CEO; 2000–2003, chairman and CEO; 2003–, chairman.
Awards: Chief Executive of the Year, Chief Executive, 2002.
■ The legendary Wall Street deal-maker Sanford I. (Sandy) Weill did the unexpected in the fall of 2003: dubbed by analysts and friends as the CEO Most Likely to Live Forever, according to Chief Executive magazine, Sandy Weill stepped down from his position as chief executive officer of Citigroup, surrendering that responsibility to his longtime protégé Chuck Prince. He would, however, stay on as chairman of the world's largest financial-services firm until April 2006.
Weill, whose climb to the very pinnacle of the financial industry began with a job as a $35-a-week Wall Street runner
in the mid-1950s, engineered the creation of Citigroup when he encouraged John Reed of Citicorp to merge that institution with his Travelers Group in 1998. Although at first Reed and Weill shared CEO responsibilities at Citigroup, the former stepped aside two years later to make Weill the undisputed leader of the financial-services giant. Under Weill's direction Citigroup's assets grew to more than $1 trillion in the first half of the new millennium.
Questions persisted about Weill's willingness to sit back and leave the day-to-day decision-making to the new Citigroup CEO Prince; some doubted that Weill would make good on his pledge to step down as chairman in 2006. Citigroup's board had been pressuring Weill since the early 2000s to put a succession plan in place. Although Weill finally succumbed to that pressure in the summer of 2003, many close to Citigroup expected that he would continue to play an active role in determining the firm's future course.
GROWS UP IN BROOKLYN
The son of Jewish immigrants from Poland, Weill was born in Brooklyn, New York, on March 16, 1933. His father, Max, owned a dressmaking business, and his mother, Etta, was a homemaker. Weill and his younger sister, Helen, grew up in the Bensonhurst neighborhood of Brooklyn. Short and chubby as a boy, Weill was a ready-made target for neighborhood bullies, according to the Wall Street Journal reporter Monica Langley's 2003 book, Tearing Down the Walls: How Sandy Weill Fought His Way to the Top of the Financial World … And Then Nearly Lost It All. The boy's failure to stand up for himself brought Weill into conflict with his father, who belittled him for running to his mother whenever the bullies struck.
Life improved for Weill when at the age of 14 his parents enrolled him at the Peekskill Military Academy, not far from his grandparents' upstate farm. Although at five feet, nine inches, he was too short to make the school's football team, he found an athletic niche on the tennis team. He had learned to play the game at summer camps and went on to captain the Peekskill squad. In the late 1940s his father left the dressmaking business to open up a steel-importing company, which Weill told fellow students he planned to join after college.
A stellar student at the military academy, Weill easily won acceptance to the Ivy League's Cornell University. Still holding onto his dream of working with his father, he decided to major in metallurgical engineering. When the demands of that course of study began to interfere with his extracurricular activities, Weill switched to a liberal-arts program. Although he dated frequently, he had not yet met the woman of his dreams; that changed when a matchmaking aunt back in Long Island introduced Weill to her neighbor Joan Mosher, a student at Brooklyn College.
PARENTS' SPLIT IMPERILS PLANS
After their first date, Weill "vowed to friends that he was going to marry Joan Mosher and, true to that pledge, he never dated anyone else," Langley wrote in her profile of Weill (2003). Although the two came from very different backgrounds, Weill and Mosher began making plans to marry soon after the groom-to-be received his degree from Cornell. However, those plans seemed likely to collapse in the spring of 1955, only weeks before Weill's scheduled graduation, when he received an anguished telephone call from his mother reporting that his father had left her for a younger woman. Weill left college, missing a critical exam, and picked up his sister, who was studying at Smith College, and together they drove to confront their father. Not only was Max unyielding in his determination to end his marriage to Etta, but he had yet more devastating news for his son: he had secretly sold his steel-importing business months earlier, thus robbing his son of the position for which he had worked so hard to prepare.
For a time Max's abrupt abandonment of wife and family threatened to destroy both Weill's career plans and his marriage to Mosher. When Cornell announced plans to block his graduation because of the missed exam, the Moshers threatened to withdraw their blessing for the union between their daughter and Weill. In the end Cornell relented and allowed Weill to take a make-up exam, clearing the way for his graduation as well as the wedding, which took place on June 20, 1955. Weill was still left without a job, however; he decided to try his luck on Wall Street.
After having a number of doors slammed in his face, Weill accepted a job as a runner for the Wall Street brokerage firm of Bear Stearns. The lowly job, which paid a meager $35 a week, involved the delivery of security certificates from the brokerage to other companies in lower Manhattan. In the performance of his duties Weill saw stockbrokers in action and soon decided he would like to join their ranks. When he promised to study for his brokerage license on his own time, Bear Stearns gave him the green light to give it a try. Within a year Weill had passed the exam and became a licensed broker at Bear Stearns.
JOINS WITH THREE OTHERS TO SET UP OWN FIRM
After earning his stripes as a broker, Weill moved on to Burnham & Company, where he continued to fine-tune his brokerage savvy for the next few years. In 1960 he and the investment banker Arthur Carter, a close friend, joined forces with the stockbrokers Roger Berlind and Peter Potoma to launch a brokerage firm of their own. With little to build upon except the customers the four partners had brought with them, the new firm of Carter, Berlind, Potoma & Weill might have foundered had it not been for Weill's financial-research prowess. Soon institutional investors—most notably mutual funds and pension funds—were beating down the firm's doors for Weill's highly touted investment research reports. Fidelity, the up-and-coming Boston-based mutual fund, was the firm's first major institutional client; as the firm's reputation grew, so did its client base. After Peter Potoma was disciplined by the New York Stock Exchange in late 1962, his three partners bought him out, and the firm became Carter, Berlind & Weill.
Two of the early hires at the firm were Arthur Levitt Jr., son of the longtime New York state comptroller, and Marshall S. Cogan. When Arthur Cooper left the firm after a disagreement with his partners, Cogan and Levitt signed on, and the firm became Cogan, Berlind, Weill & Levitt (CBWL). Having carved out a niche for itself on Wall Street, CBWL, with Weill at the helm, launched an ambitious expansion drive. In 1970 CBWL acquired the prestigious, old-line brokerage firm of Hayden Stone to become CBWL Hayden Stone. Two years later the firm's name was changed to Hayden Stone & Company. In 1973 and 1974 the firm expanded further with the acquisitions of Hentz & Company and Faulkner, Dawkins & Sullivan, respectively. In its biggest acquisition yet, Hayden Stone later in 1974 purchased Shearson Hammill & Company to become Shearson Hayden Stone. After its 1979 acquisition of Loeb Rhoades, Hornblower & Company, the firm became Shearson Loeb Rhoades with Weill as its chairman and CEO.
TALKS MERGER WITH AMERICAN EXPRESS
Although it was Weill's research and deal-making skills that had transformed the small start-up brokerage firm into a Wall Street powerhouse through strategically planned acquisitions, someone else first came up with the idea for Weill's next big deal. According to Amey Stone and Mike Brewster, authors of King of Capital, in late 1979 the investment banker Salim Lewis approached the American Express CEO James Robinson III to suggest that a merger between American Express and Shearson made sense. Although he was not immediately taken by Lewis's proposal, Robinson thought it over for several months; preliminary merger talks between Robinson and Weill eventually began. The acquisition of Bache by Prudential in early 1981 energized the talks, and on June 19, 1981, American Express shareholders approved the $900 million stock deal.
The deal with American Express significantly increased Weill's wealth, but it also left him in a position of far less influence. In the days immediately following the merger he was the number-three man at American Express, behind the chairman and CEO Robinson and the president Al Way. As a result Weill's ability to freely wheel and deal was significantly constrained. In 1983 Weill succeeded Way as president and not long thereafter proposed that American Express buy Investors Diversified Services (IDS), the Minneapolis-based mutual funds/insurance company, in a $1 million stock deal. Although Robinson was initially cool to the proposal, he eventually approved the IDS acquisition for $773 million.
Weill was next assigned to rescue American Express's faltering insurance subsidiary Fireman's Fund, a task he successfully accomplished, though it took longer than he had expected. However, he remained unhappy at American Express and hoped that his proposal for a leveraged buyout of Fireman's Fund might give him a chance to be the boss again. Robinson ultimately rejected the proposal to buy the insurance subsidiary; in 1985 Weill resigned from the giant financial-services firm.
TAKES COMMERCIAL CREDIT PUBLIC
Temporarily unemployed, Weill cast about for a new venture. In 1986 he approached the Minneapolis-based Control Data Corporation, which was struggling financially, with a proposal to spin off its Commercial Credit Company subsidiary. Control Data gratefully accepted Weill's suggestion and authorized him to lead the initial public offering (IPO) of Commercial Credit. Control Data retained a share of roughly 20 percent in Commercial Credit but sold off the rest to the public; Weill bought heavily into the spun-off company and took over as CEO.
To whip Commercial Credit back into shape, Weill cut costs sharply, giving earnings of the Baltimore-based consumer-credit/insurance firm a much-needed boost. He next set his sights on Primerica Corporation, an insurance/money-management company that had recently acquired the brokerage firm of Smith Barney Harris Upham. He acquired Primerica in a $1.5 billion acquisition in 1988. Among Primerica's holdings was its A.L. Williams Corporation insurance subsidiary, which Weill combined with Smith Barney to form Primerica Financial Services. As he had done in the past, Weill moved aggressively to expand his new prize by acquisition. Over the next couple of years he acquired the receivables and branches of Landmark Financial Services and the consumer-lending operations of Barclays American/Financial. At the same time he took steps to sell off Primerica's nonstrategic assets.
Weill's next big move came in 1992 when he oversaw Primerica's purchase of a 27 percent share in Travelers Corporation. This was followed in 1993 by the realization of a dream for Weill. He regained control of Shearson, the massive brokerage firm he had struggled to build, when Primerica acquired the company's retail-brokerage and asset-management operations from American Express for $1.2 billion. Weill then combined Shearson and Smith Barney to create one of the world's largest investment-banking/brokerage firms. On the heels of this acquisition Weill led Primerica's purchase of the remaining 73 percent of Travelers Corporation common stock, after which the two companies were merged and renamed Travelers.
ASSUMES LEADERSHIP OF TRAVELERS
Weill took over as chairman and CEO of the newly created Travelers, while Edward Budd, the chairman and CEO of Travelers Corporation before the merger, became chairman of the new company's executive committee. Weill said that the merger would create "dominant positions and strong brand franchises in four major businesses—insurance, securities brokerage, asset management, and consumer lending," according to a report by Jim Connolly in National Underwriter (September 27, 1993). In 1994, in an attempt to expedite integration of the newly merged company, Weill sold its American Capital Management & Research subsidiary to Clayton, Dublier & Rice for $430 million and its Bankers and Shippers Insurance Company to Integon Corporation for $142 million. In 1995 Travelers Insurance completed the sale of its group-life and related businesses to Metropolitan Life Insurance Company. In a new venture the Travelers insurance subsidiary and Metropolitan Life joined forces to establish MetraHealth Companies, a new health-care operator. Later that same year MetraHealth was sold to United HealthCare in a transaction that yielded $831 million in cash for Travelers.
Renamed Travelers Group in 1995, the company in 1996 paid roughly $4 billion in cash to acquire the domestic property and casualty insurance operations of Aetna Life and Casualty, which were combined with the corresponding operations at Travelers to create a holding company named Travelers/Aetna Property Casualty Corporation. Weill next engineered a takeover of Salomon. This $9.1 billion stock deal gave Travelers control of the prestigious investment-banking firm Salomon Brothers, which Weill merged with Smith Barney to create the world's second-largest securities firm, Salomon Smith Barney.
In taking Commercial Credit Company and transforming it in just over a decade into a financial-services giant, Weill had once again managed to build a middling-sized firm into a powerhouse. But for Weill, the biggest deal of all lay just ahead. In a 1997 brainstorming session with his top lieutenants at Travelers Group, as Weill told Daniel Kadlec of Time, the idea of buying a globally positioned commercial bank was first raised. One of the candidates most favorably put forward was Citibank, of which Citicorp was the parent. As Weill told Kadlec, "It was a real wheel spin. No one thought it would go anywhere, but everyone liked the idea. So I decided to call the CEO of Citicorp John Reed" (April 20, 1998).
TRAVELERS, CITICORP MERGE
To almost everyone's surprise, Reed liked the idea. In April 1998 Weill and Reed announced plans to combine Travelers and Citicorp in the biggest merger in history. According to Time, the newly created company, dubbed Citigroup, offered a full range of financial services to roughly 100 million customers in one hundred countries through a network of more than three thousand offices staffed by 162,600 employees. At the time of the merger the new company's assets were estimated at $700 billion, a figure that topped $1 trillion by early 2004. The megamerger was officially finalized on October 8, 1998.
In the early days of the newly created company, having cooperatively hammered together the massive merger of their respective companies, Weill and Reed shared power; however, it was not long before a power struggle between the two broke out. Weill emerged on the winning side of that struggle when Reed announced his decision to step down in February 2000. Reed's departure left Weill as undisputed chairman and CEO of Citigroup. As he had done with all of his acquisitions in the past, Weill continued to pave the way for strategic takeovers by carefully cutting costs wherever possible.
On May 17, 2001, Weill announced plans for Citigroup to purchase Mexico's second-largest financial group for $12.5 billion in cash and stock. In announcing the purchase of Grupo Financiero Banamex-Accival, widely known in Mexico as Banacci, Weill said the deal made sense in view of the increasing integration of the U.S. and Mexican economies. According to an Associated Press report, Weill said, "This combination positions both Banacci and Citigroup to capitalize on this important trend, and thus is a natural next step for both of our companies" (May 17, 2001). Only seven months later, in December 2001, Weill announced plans to sell off 20 percent of Citigroup's Travelers property and casualty group in an early 2002 IPO. The sale, which was prompted by the insurance unit's disappointing performance, produced between $4 billion and $5 billion for Citigroup.
WIDELY RESPECTED BY HIS PEERS
Although Weill managed to ruffle feathers in some quarters and even received some unwelcome government scrutiny for Citigroup's dealings with Enron Corporation and other companies that had cooked their books, the deal-maker was almost universally respected—if not loved—by his peers. When Chief Executive named Weill its 2002 Chief Executive of the Year, judges on the magazine's CEO panel were lavish in their praise of the Citigroup chief. Robert Nardelli, the chairman and CEO of Home Depot, saluted Weill's "proven track record at multiple companies," while Michael Dell, the founder and CEO of Dell, hailed Weill for his "fantastic career running complex financial institutions" (July 1, 2002).
Whether Weill would live up to his promise to leave Citigroup in 2006 remained to be seen, but it was considered likely that he would continue to be a force to be reckoned with at least until then. The Citigroup chairman and his wife, Joan, lived in Connecticut and together were well known for extensive philanthropic activities. The Weills contributed the financing necessary for the construction of a new education center at Cornell University Medical College. The medical college was eventually named in their honor, and Weill served as chairman of its board of overseers. He also served as a trustee emeritus for Cornell University. A member of both the Business Roundtable and Business Council, Weill also sat on the board of trustees of New York Presbyterian Hospital and the board of overseers of the Memorial Sloan-Kettering Cancer Center. The Weills had two grown children, Marc and Jessica.
sources for further information
Associated Press, "Citigroup Buys Second-Largest Financial Group in Mexico," Cincinnati Post, May 17, 2001.
Connolly, Jim, "Primerica Buys Travelers for $4.2B," National Underwriter, September 27, 1993.
Creswell, Julie, "No. 4 Sandy Weill: Citigroup," Fortune, August 11, 2003, p. 62.
English, Simon, "Sandy Weill Given Package of $45M," Daily Telegraph, March 17, 2004.
"History of Citigroup," Travelers Life & Annuity, http://www.travelerslife.com/html/History_Of_Citigroup.shtml.
Johnson, Cecil, "Hold the Lettuce: Weill's Success Started Out Small and Flourished," Fort Worth Star-Telegram, July 3, 2002.
Kadlec, Daniel, "Making a Money Machine," Time, April 20, 1998.
Langley, Monica, Tearing Down the Walls: How Sandy Weill Fought His Way to the Top of the Financial World … And Then Nearly Lost It All, New York, N.Y.: Simon & Schuster, 2003.
Loomis, Carol J., "Sandy Weill's Life in the Slow Lane," Fortune, January 12, 2004, p. 34.
——, "Whatever It Takes," Fortune, November 25, 2002, p. 74.
Powers, Steve, "Tearing Down the Walls on a Deal-maker," San Jose Mercury News, March 23, 2003.
Prince, C. J., "The Deal-maker," Chief Executive, July 1, 2002.
Protos, John, "In Business This Week: Citigroup's Long Adieu to Travelers," BusinessWeek, December 31, 2001.
"Sanford I. Weill, Chairman," Citigroup, http://www.citigroup.com/citigroup/profiles/weill/bio.htm.
"Sanford I. Weill: Financier and Philanthropist," Academy of Achievement, Hall of Business, http://www.achievement.org/autodoc/page/wei0bio-1.
Saporito, Bill, "Sandy's Story," Time, March 24, 2003.
Serwer, Andy, "It's Taken a Weill: Citigroup's Legendary Deal-maker Deals Himself Out," Fortune, August 11, 2003, p. 36.
Sloan, Allan, "A Perfect Chance to Take a Bow: Sandy Weill, King of Wall Street, Installs a Prince," Newsweek, July 28, 2003, p. 44.
Smith, Marguerite T., "Betting on Weill's Takeover of Primerica," Money, November 1, 1988.
Stone, Amey, and Mike Brewster, King of Capital: Sandy Weill and the Making of Citigroup, Hoboken, N.J.: John Wiley amp; Sons, 2002.
"Weill Education Center: The Weills," Cornell Medical Education, http://edcenter.med.cornell.edu/weill/weills.shtml.
Wigmore, Barry, "Sandy Might Earn £140M a Year but When He Wears a £2,000 Suit, It Looks like He's Been Sleeping in It," Sunday Mirror, April 19, 1998.
Weill, Sanford I.
WEILL, SANFORD I.
WEILL, SANFORD I. (1933– ), U.S. banker, financier, and philanthropist. The son of Polish immigrants, Weill was born in Brooklyn, n.y. When his parents could not find housing, they enrolled him at the Peekskill Military Academy. He attended Cornell University, where he was a member of the Air Force rotc. Although he wanted to be a pilot, that was not to be. In 1955 he got his first job on Wall Street as a runner for Bear Stearns. While there he became friends with Arthur Carter, who was working at Lehman Brothers, and he became a licensed broker. In 1960, Carter, Roger Berlind, Peter Potoma, and Weill formed Carter, Berlind, Potoma & Weill. After the New York Stock Exchange brought disciplinary proceedings against Potoma, he left the firm. In 1968 the firm became Cogan, Berlind, Weill & Levitt (Marshall Cogan, Roger Berlind, who later became a Broadway producer, Arthur Levitt). Weill was chairman from 1965 to 1984, a period in which the firm completed over 15 acquisitions to become the country's second largest securities brokerage firm. The company became cbwl-Hayden, Stone in 1970, Hayden Stone in 1972, Shearson Hayden Stone in 1974, when it merged with Shearson Hammill & Co., and Shearson Loeb Rhoades in 1979, when it merged with Loeb Rhoades Hornblower. With capital totaling $250 million, Shearson Loeb Rhoades trailed only Merrill Lynch as the securities brokerage industry's largest firm. In 1981 Weill sold the company to American Express for about $930 million in stock. He began serving as president of American Express in 1983 and as chairman and chief executive of its insurance subsidiary, Fireman's Fund Insurance, in 1984. Frustrated with the direction of the company, Weill quit American Express in 1985. The following year he went to Minneapolis to persuade Control Data to spin off its subsidiary, Commercial Credit, in a public offering worth $850 million. Weill took over as chief executive, investing $7 million of his own money. He also acquired its subsidiary, a property and casualty insurance concern called Gulf Insurance. By 1988 Weill and his team had turned Commercial Credit around and acquired the Primerica Corporation for $1.5 billion along with its holdings, the brokerage Smith Barney and the A.L. Williams insurance company, renamed Primerica Financial Services. Over the next two years Primerica absorbed the consumer lending operations of Barclays American/Financial. In 1992 alone, Primerica raised $625 million by selling nonstrategic assets. Weill then bought 27 percent of Travelers Insurance for $722 billion. He personally earned $67.6 million that year, most of it from stock options, making him the second highest-paid executive in the United States. The following year Weill realized an old dream. He regained control of Shearson (now Shearson Lehman), buying it back from American Express for $1.2 billion. By doing so, he acquired Shearson's 8,400 brokers and state-of-the-art back office, while leaving behind Shearson's litigation liability. In 1996 Weill added to his holdings, at a cost of $4 billion, the property and casualty operations of Aetna Life & Casualty, and the following year he acquired Salomon, the parent company of Salomon Brothers, for over $9 billion in stock. In April 1998 Travelers announced an agreement to undertake the $76 billion merger between Travelers and Citicorp, the parent company of Citibank, to create Citigroup. Citicorp was the world's largest supplier of credit cards, and Citibank was the second largest bank in the United States. At the beginning of the day the merger was announced, the two companies were valued at $70.6 billion. By the end of the day the value had jumped to $83.6 billion. In 2002 the company was rocked by a wave of scandals that followed the stock market downturn. Weill was replaced as chief executive of Citigroup in 2003. He served as chairman until 2006. Weill's career was also marked by extensive philanthropy. He endowed Cornell's medical school in 1998 with a $100 million pledge, and it was named the Joan and Sanford I. Weill Medical College and Graduate School of Medical Sciences. As chairman of Carnegie Hall he raised $60 million for renovation of its facilities, and one of the concert halls is named for him. He was the principal sponsor of the High School of Economics and Finance in New York and worked with the Disney Company to create, at the children's museum in Baltimore, Md., a game to teach youngsters about capitalism.
[Stewart Kampel (2nd ed.)]