Michel David-Weill, who died in his 820 Fifth Avenue apartment on June 16 after a brief illness, was the longtime patriarch of Lazard, the international investment bank. Or at least he was until 2005, when the wily deal-maker Bruce Wasserstein wrestled the firm away from him, took it public on the New York Stock Exchange, and made himself a multi-billionaire in the process. David-Weill was 89 years old at the time of his death.
Michel—or MDW, as he was known around the firm—was the sole male heir to the private Lazard partnership, which was founded by his great-grandfather Alexander Weill, along with three of his first cousins, the Lazard brothers, in 1848 as a dry-goods store in New Orleans.
After a fire destroyed the store the following year, the four men hauled the surviving inventory across Mexico and up the California coast to San Francisco. They re-established the store and sold their imported clothes to gold miners. Eventually, they decided the importing and exporting of gold bullion was a better business, founded a bank, and opened offices in New York, Paris, and London. Over time, Alexander Weill defenestrated his cousins and took control of the growing firm.
Michel’s grandfather David David-Weill added the David and the hyphen to the surname at the beginning of the 20th century to lend the family name a soupçon of prestige and aristocracy, and to play down the family’s Jewish heritage.
Like many other French Jews, Michel converted to Catholicism during World War II. He rode out the war with his mother and sister using falsified papers given to them by sympathizers in Nice and assumed the name Wattel. Michel’s father, Pierre David-Weill, was often away from the family, in New York, running Lazard Frères as best he could after the Nazis closed the Paris partnership.
The family eventually rented the Château de Béduer, in Vichy France. Though plenty nice, the château had no running water. They stayed there for two years, from 1943 until Easter 1945. Michel’s official papers explained that he was now “Michel Wattel,” born in Amiens (instead of his actual birthplace, Paris) and in a year different from his actual birth. Even in hiding, the family kept their maids and butler. Michel rarely went to school during the war years. “It was wonderful,” he told me years later. “We had a great time. It was like being on holidays and I read a lot,” including the literature of Flaubert, Stendhal, and Gide.
He moved to New York City after the war. After graduating from the Lycée Français in New York and the Sciences Po in Paris, Michel joined the family firm’s New York office in 1956. He was 24 years old. He would have brief stints working at Lehman Brothers and Brown Brothers Harriman, but ultimately became a general partner of Lazard Frères, the New York partnership, in 1961—on the same day as did Felix Rohatyn, the legendary investment banker who helped stave off the city’s bankruptcy in the mid-1970s.
Weill of Fortune
After the unexpected death of his father and then of André Meyer, the great Lazard banker who ran the firm after World War II, Michel took control of the three separate houses of Lazard—New York, Paris and London—in 1977. The three Lazard houses had some overlapping ownership and tried valiantly—but not always effectively—to work together on deals when they could.
Under Michel’s shrewd 25-year stewardship, Lazard’s elite fraternity of investment bankers—among them the likes of Rohatyn, Ken Wilson, William Loomis, Bruno Roger, Vernon Jordan, and J. Ira Harris—consistently punched above their weight, advising on such landmark deals as ITT’s acquisition of the Hartford insurance company, the sale of Paramount Communications to Viacom, and the merger that created Time Warner Inc.
Michel had a unique vision for the way Lazard and its highly sought-after bankers should go about their business of advising top C.E.O.’s on their most important deals. Although few knew what he was talking about, Michel liked to describe Lazard as an haute banque d’affaires vis-à-vis le monde, which eventually he took to describing, in English, as “a state of mind, not an activity. It is a firm which puts itself at a level parallel with the level at which decisions are made in enterprises. It means that you remain at the decision-making level, that you give advice at that level, that you think at that level, and that you remain exclusively at that level.” No other leader of a Wall Street firm speaks about a bank’s mission this way.
Michel did not do deals and rarely met with clients, another way he distinguished himself from other Wall Street executives. Rather, he was content to manage, and massage, the egos of his cunning and occasionally ruthless and mercurial bankers. (Lazard was a tough place to work, let me assure you. I spent six years there in the 1990s.) He was a master at bucking them up after a poor year or keeping them in check when they exceeded expectations.
Michel’s hegemony at Lazard was absolute, like his father’s and André Meyer’s before him. In addition to being known as the “Sun King,” he was also known as “Mr. 4.1,” a reference to the all-important provision of the Lazard partnership agreement. Under that clause, Michel had the sole authority to determine his partners’ annual compensation, to decide who got hired and who got fired, and to determine who got promoted into the partnership ranks and when.
Year after year, he was careful to stay out of the United States for the requisite number of days so that he could avoid paying New York City and New York State taxes. But when he returned to Manhattan around Labor Day, after spending the summer at Sous-le-Vent, his seaside estate in Cap d’Antibes in the South of France, Michel’s partners would beat a path to his corner office on the 32nd floor of One Rockefeller Plaza. The silly season at Lazard had begun, where grown men (and the very few Lazard women) made the annual pilgrimage to see Michel—and kiss his ring—after being summoned to appear by his longtime assistant, Annik Percival (whom Michel inherited from Meyer), to see how much money they could cajole out of him. “He is ready for you now,” Percival would say.
It was always an intimate give-and-take with Michel, and the conversations often extended over several autumn months. In the end, a list of the partnership percentages was distributed around the firm every year so that partners could keep track of who was up and who was down, who was in favor and who was on his or her way out the door. (Michel’s side deals with individual partners, where he would somehow come up with additional compensation for him or her, were hushed up but gossiped about incessantly.) One longtime partner told me, “It was like we were bringing bags of gold to Michel, and he would allow us to take a little bit off the bottom, and then he would put the rest in his pocket.”
Frank Pizzitola, another longtime partner, described Michel’s unique system of remuneration in this way: “This is not a partnership. It’s a sole proprietorship with fancy profit sharing.”
It didn’t matter. They were all getting fabulously rich. Michel would take out as much as $40 million a year, at a time when that was real money.
Michel did not do deals and rarely met with clients. Rather, he was content to manage, and massage, the egos of his cunning and occasionally ruthless and mercurial bankers.
For years, Felix Rohatyn’s share of the firm’s pre-tax profits was a precise 10.796 percent, which made him rich, too, as the firm’s profits exploded in the 1980s and 1990s. But he was not as rich as Michel. For reasons to do with his refugee mentality (he grew up in Rohatyn, Ukraine, and then moved to Paris; he eventually just barely escaped the Nazis, after a two-year odyssey that took him and his family to Casablanca, Lisbon, and Rio de Janeiro), Rohatyn steadfastly refused Michel’s offer of equity in the firm. So, Michel retained most of it, and a mysterious group of French holding companies held the rest.
Like fraternal twins, Michel and Felix had an odd, sort of symbiotic, relationship. Their offices were right next to each other at One Rockefeller Plaza, but Michel’s was easily twice the size of Felix’s. They spoke only French to each other, though they would never tutoyer, the familiar form of address. And they lived less than a block away from each other on Fifth Avenue, but never socialized. Still, their unique partnership produced a blockbuster of profits.
Nevertheless, the Lazard offices at One Rockefeller Plaza were exceedingly shabby, probably in violation of building codes. Lazard took over the offices from General Dynamics in May 1972 without renovating, because Meyer’s thinking was that it was better for clients to see threadbare carpet and dying office plants than a plush and expensive spread, lest they think Lazard overcharged for its services.
Everything began to change at Lazard when the jets hit the World Trade Center, on September 11, the horror of which Michel told me he watched from his corner office. By then, he had successfully found a way to merge the three houses of Lazard into a single entity. But he had been unable to find a proper successor, seeing off one man after another, including Édouard Stern, his son-in-law, who only a few years later was murdered in his Geneva apartment by his paramour while wearing a full-body latex suit. (Yes, it’s true.)
For years, Michel had tried to recruit Bruce Wasserstein to Lazard. He believed Wasserstein, the investment-banking wunderkind who built First Boston and then his own firm, Wasserstein Perella & Co., into Wall Street powerhouses before selling his firm to Dresdner Bank for nearly $1.4 billion in 2000, had the secret sauce of the best Lazard partners, which is perhaps why previous attempts to recruit him were blocked by the Lazard partners.
But after the terrorist attack on New York City, Michel started to panic. With few senior partners left to thwart him, he finally succeeded in bringing Wasserstein to Lazard. Wasserstein drove a very hard bargain with Michel. Effective January 1, 2002, Wasserstein was named “head” of Lazard, with contractual control of the firm on a day-to-day basis. Michel allowed Wasserstein to buy 1 percent of Lazard for $30 million and gave him another 7 percent of the firm for free. Wasserstein’s 8 percent ownership of Lazard was just below Michel’s 9 percent direct ownership (though Michel also had other pockets of ownership through the mysterious holding companies).
But it was no longer Michel’s firm to run. Wasserstein had dispatched him to serve solely as chairman of the Lazard board of directors. Many of Michel’s partners believed Wasserstein had snookered Michel out of his birthright. There was little debating it. It took another three years or so, but in May 2005, Wasserstein took Lazard public—against Michel’s wishes.
In the end, his power usurped and with no one to blame but himself, Michel capitulated, allowing his stock to be purchased in the I.P.O. for around $1.6 billion, a nice consolation prize. After leaving Lazard behind, Michel spent most of his time in Paris, leading Eurazeo, the private-equity firm he founded, which helped to make him even wealthier.
There are so many Michel David-Weill stories. But one of my favorites involves Michel and his love of expensive Cuban cigars. One day, Kim S. Fennebresque, then a Lazard partner, invited the chairman of Beneficial Finance for lunch with Michel in the Lazard dining room in New York. At the end of a meal there, the tradition was that the waiters would pass around cigars to the clients and the bankers. But Michel insisted that the waiter fetch his personal cigars.
Many of Michel’s partners believed Wasserstein had snookered Michel out of his birthright. There was little debating it.
“He had someone send for his stash because basically they put shit in the partners’ dining room except when Michel was there,” Fennebresque once told me. “I mean, it was just rolled camel turds. So, when Michel came in, they brought the real stuff, right? So, Michel offered one to the client, who said no. And I’m sitting there, smiling, like, ‘I’ll take one,’ and you could just see as he handed it to me, the notion, the insubordination of one of his fucking domestic staff—moi—would deign to have one of his heaters was just too much to bear.”
Annik Percival would also have some fun with Michel’s cigars. She would permit partners she liked—Fennebresque among them—to help themselves to the cigars in his office humidor when Michel was off in Paris, London, or Sous-le-Vent. “She’d call me,” Fennebresque continued, “and I’d go fish some out of his humidor because they’d be stale by the time he’d get back.” But sometimes Fennebresque couldn’t wait until Michel went out of town to get his Cuban-cigar fix. At the partners’ meetings on Monday mornings, he would watch in amazement as Michel went through his typical cigar-smoking ritual. “I used to watch Michel,” he said. “And he’d smoke these things. He’d light them up and smoke them and literally smoke three-eighths of an inch and then put it in the ashtray and then light up another one. And I just thought this was fucking ridiculous. So, I made sure I was the last guy to leave the partners’ meeting. And I would clip both ends of his cigars in the ashtray, and I would take them. Every Monday, I had two $15 cigars. And no one ever knew.”
In 1956, Michel married Hélène Lehideux. Together, they had four daughters—Béatrice, Natalie, Cécile, and Agathe—and 11 grandchildren. Each daughter has her own floor in Michel’s gargantuan hôtel particulier, off of Saint-Germain-des-Prés, in Paris. He was considered one of the world’s finest art collectors and spent years re-assembling the pieces of his father’s and grandfather’s collections, which the Nazis had pilfered from the family during World War II. His longtime friend Philippe de Montebello, the onetime director of the Metropolitan Museum of Art, gave a eulogy at Michel’s funeral, in Paris. He is interred in the family tomb, in the Montparnasse Cemetery.
In the great French tradition, Michel also had a longtime mistress, the New York socialite Margo Walker, who lived around the corner from another home Michel owned in Locust Valley, Long Island. He had helped Walker buy the five homes on West Island, just off Locust Valley, that many believe to be the West Egg of Great Gatsby fame.
Michel had come to New York City for heart surgery and had been visiting with Walker in the days before his sudden death.
William D. Cohan is a Writer at Large for AIR MAIL and the author of such best-selling books as The Last Tycoons, House of Cards, and The Price of Silence. He is a founding partner of Puck. His new book, Power Failure, will be published in November