Bull Street (23 page)

And what about him? Everything he’d worked so hard for, sacrificed for. Whiz kid in advertising but left it and borrowed $50 thousand for business school, finally on his way and still just dreaming of hitting it big, but now tasting enough of it to know he might make it. Screw that. Smash him—and his career—to bits, then see if there’s anything incriminating to pick up, anything useful when they rummage through the busted pieces.
This is it. I’m dead.

He didn’t know how long he walked, but his vision started clearing about the same time his mind did. He was aware that all of his senses were at full alert. No doubts, one thing in mind: save his ass, and Kathy’s and Dad’s, even if he didn’t know how to go about it. No panic, no fear. It was awful, exhilarating and fascinating at the same time.

Upstairs in 75 Centre, Croonquist said, “That didn’t go so well. We gotta work on our routine.”

Holden said, “He’s a feisty little sucker. Hard to figure how some kid in his twenties could keep his poise like that, pull it off like he was actually innocent.”

“Unless he is.”

Holden scowled.

“It’s happened before. But never mind.” Croonquist had seen even tougher guys fake it until the end, then fold.

“Couldn’t hurt to haul in his old man.”

“That’s a lotta paperwork. I say we let him stew about it for a few days before we go through all that. Maybe just worrying about it brings him around. But I say we toss his apartment now. The more pressure the better.”

“Way ahead of ya. As of two days ago we didn’t have enough to get a search warrant through a judge.”

Croonquist raised his eyebrows.

“Not as easy as it used to be.”

“Anything come out of today that would change that?”

“Nope.”

“Can you have some of your guys at least stake out his apartment?”

“Already done. Anybody on our list shows up, we tail him.”

“Him? It’s usually the girlfriend.”

“Kathy Cella. Even my goons won’t miss her. She’s a real piece of ass.”

Croonquist nodded. They’d have to settle for that, see if it turned up anything. Man, what a setback. He swore the kid would flip and tells them everything he knew. Still, Croonquist knew he was onto something, but now he had no way of knowing how long it would take to unravel it.

He played it right, though. Charlie Holden was the right guy, a natural born SOB. Between the two of them, this kid Blum had
no idea what he was up against. He cracked open a pistachio and popped the meat into his mouth.

Dad was calm. There were long pauses on the phone, Richard only saying what he had to. Finally, Dad said, “I can’t keep this from your mother. But don’t worry about me. Holden’s probably bluffing, and if he isn’t, he’s overdramatizing.” Then another pause, Dad thinking, undoubtedly wanting to choose his words so he didn’t burden Richard with any more concern. Then: “Sounds like you should get a lawyer. I can talk to some of our people in the legal department. That’s a start.”

“Walker will get me one, I’m sure, but thanks, Dad.” He said it right back, without hesitation. Now it was his turn to buck up and sound confident, not let Dad worry. But Richard wasn’t so sure, remembering the forms he’d signed in the M&A Department, the rights he’d signed away. His hand felt weak holding the phone. “I love you, Dad. Sorry to get you into this, but it’ll be okay. I’ll handle it.”

“I love you, son. Call me later. Let me know.”

Richard hung up wondering what he’d do if Walker didn’t get him a lawyer, or worse, turned on him

N
EW
Y
ORK
C
ITY
.
R
ICHARD DIDN’T
have a chance to discuss his meeting with Croonquist and Holden with anyone before Jack called him to prepare for a face-to-face negotiation between Milner and Nick Williams, Tentron’s CEO. The face-to-face was for CEOs and senior advisers only. Richard rode uptown with Jack and Mickey in Jack’s Porsche, got behind the wheel when they got out at Sterling & Dalton’s offices and parked the car at the One Lexington Plaza garage, caddy-corner across 45
^th
Street from the Helmsley building. Jack had a monthly space at One Lex, and always parked there when they went up to see Milner. The garage attendants all knew Richard by now, even gave him the car without a ticket. Richard waited at Milner’s office for everyone else to get back from the CEO meeting.

He kept replaying the meeting at 75 Centre Street in his mind on infinite loop. After ten loops he’d figured out what he was gonna do.

Milner, Jack, Mickey and Howard Blaine walked the five blocks from Sterling’s offices to Milner’s after the face-to-face with Nick Williams and his advisors. Milner saw Jack watching him like an assassin, same as throughout the meeting. Jack was obviously
trying to figure out what Milner was up to, running it around in his mind. It made Milner feel like fire ants were crawling under his skin.

During the failed negotiation with Nick Williams, his advisors said they’d stay the course with the half-assed recapitalization plan Tentron had proposed to its shareholders as an alternative to Milner’s $40 cash offer. Under the recap, Tentron offered its shareholders $45 per share in cash for half their shares, with crappy bonds of Tentron for the remaining shares. A classic last-ditch attempt by management to keep their company out of Milner’s clutches to preserve their jobs—in the process loading up Tentron with excessive debt. And it was looking like nobody else was coming off the sidelines to top either his bid or Tentron’s recap, so maybe he’d have to decide what to do about Tentron after all.

By Milner’s calculations, under the tender offer rules he had four more days to make his next move before Tentron could buy shares under its recap. He wished he could drag it out longer. But with Harrelson of Devon & Company telling Milner that senior SEC enforcement guys had flown to New York, and Jack looking more menacing by the hour, maybe four days was all he had, if that.

Yeah, he had to decide what to do.

Jack saw the usual horde of people was at Milner’s office when they got there. LeClaire had just arrived from the office. Jack waved for Blum to get his ass downstairs from Milner’s glass conference room where he was waiting. Milner insisted on debriefing with everybody on the main floor at that makeshift
conference table. Milner sat at the head, Jack watching him. Milner had been almost passive during the Nick Williams meeting. Something was off. This bullshit about doing the deal a nickel at a time wasn’t making it happen. What was up with him?

He didn’t even wanna think about the consequences on Walker if Milner blew it and Tentron didn’t get done at all. With all the capital they had invested in the deal, Walker could go bust if Milner dropped his bid.

“Short meeting,” LeClaire said.

“You said it,” Blaine said.

“Well, Mickey, whattaya think?” Milner said. He was flat, like going through the motions.

Mickey said, “I think they decided they weren’t going to agree to anything yet. Williams is taking it personally, but he’ll get over it.”

Milner nodded, acting lame, not really into it. Jack thought maybe the competition from Tentron’s recap would snap Milner out of his trance, or whatever the hell he was in, but nothing. He might actually have to get somebody to take a shot at Milner,
really
scare him. Milner hadn’t made eye contact with Jack since they sat down. Jack kept glaring at him, hoping Milner would look up, see his eyes shooting daggers. “Okay, what next?” Milner said.

Mickey said, “Let’s look at your options. If you do nothing, you lose to their recap. Their deal is hard to value because of the bonds they’re offering, but we figure it’s worth $42 a share.” Mickey turned back to look at Milner. “You’re still at $40, all cash. So if you don’t change something, their $42 beats your $40.”

“Game over,” Jack said, still watching Milner.

“What can we do to make their deal look even lousier than it is?” Milner said, now starting to look like he had a pulse.

One of the Morrow information agent guys, Walsh, stirred in his chair. “We’ve been working with your PR people on drafting some press releases and full-page newspaper ads to point out the negatives in their recapitalization plan,” Walsh said. “Puts too much debt on the company, no capital for expansion, and so on. All to keep their jobs. You know the story.”

“Fine. Circulate drafts to the whole team, get comments,” Milner said. Jack exhaled. Was the big guy coming around?

“Be careful, we need to see that material,” Blaine said, “you’re in the middle of a tender offer. You risk getting fined by the SEC if you say anything in the press that isn’t in your 14D-1 filing during the pendency of the tender offer.”

Milner made a sour face. “So read the ads and make sure I don’t say anything stupid. Just fix them,” he said, sounding impatient, looking at Blaine like he was a piece of lint to flick off his suit.

Better.

“We also have a lawsuit drafted that attacks their recapitalization,” Blaine said.

“Okay, so let’s sue them, too, distract the hell out of them. That’s good,” Milner said. “You were saying, Mickey?”

“Two major options. First, you could increase your cash bid to a price comparable to their blended value—$42. Second, you could make a comparable cash and bonds offer—the second financing scenario we discussed in our initial planning. But whatever you do, you have to make some move or you’ll lose.”

Milner had his elbows on the table with one hand clasped across his chin. He was looking out the window and up at the
sky, a smile showing in his eyes. Jack liked what he saw; the beast
was
coming out of hibernation.

Milner sat for another moment in silence, then started to really act like himself. He said, “Alright, let’s keep it simple. We bump the bid to $42 per share, all cash.” He looked at Mickey, then Jack. Then to Blaine, “File the lawsuits,” then to the Morrow guy, “Run the press releases and the ads. Enjoy yourselves, everyone.” And he stood up and walked upstairs to his office, smiling and looking confident for the first time all day. Jack grinned over at Mickey. It was a good day’s work. But on second thought, why didn’t Milner just pay $43 or $44 per share and get it over with? The difference was a rounding error to him. Maybe like Mickey said a while back, Milner was enjoying the chase more than the catch. But at least he was moving. Jack reminded himself Milner might need a poke now and then to keep some momentum. It was still no time to relax.

Upstairs in his office, Milner looked back down at the main floor. Jack was still grinning as he strutted toward the elevator. Milner smiled, relieved. Hell, he felt like he’d just passed a kidney stone. Why had he held out so long? Why didn’t he make it easy on himself earlier, and just exit, stage left? Maybe it took seeing Jack peering down at him from the other end of the conference table like a loaded cannon.

Whatever, it just came to him during the meeting downstairs. He was gonna run. He’d make it look like he was doing the Tentron deal, wire a pot of money offshore, pack up Mary Claire on one of his Gulfstreams and fly away. And by the time Jack figured out what was going on, Mary Claire and he would
be sitting in the Hotel du Rhone in Geneva eating fois gras and drinking Chateau d’Yquem. Now he felt giddy.

And yet he couldn’t abandon the hope that somehow he’d be able to pull the unlikely rabbit out of his ass: rat out the bigger fish and live happily ever after, sleeping in his own bed on Park Avenue.

“You went by yourself? Without a lawyer?”

“Yeah,” Richard said. “Like I said, they invited me in to help with an investigation they said they were working on. I had no idea they were gonna lean on me like that.” Richard had gone directly to LeClaire’s office when he got back from the meeting at Milner’s. Now he was seated in his customary spot in front of LeClaire’s desk, only this time he wasn’t watching LeClaire lay out conceptual structures in his fountain-penned shapes on a notepad. LeClaire was looking at him like he did when Richard did something like forgetting to include deferred taxes in the denominator of a debt-to-total capital ratio.

LeClaire said, “The U.S. Attorney’s Office and the enforcement staff of the SEC never invite you in for a chat. If they want to talk to you, they want to talk to
you.
Not about somebody or something else. And you never, ever talk to the SEC or the U.S. Attorney’s Office without a lawyer.”

Richard nodded.
And how.

“Did they tape the conversation?”

“Yeah.”

“Dumb. The first thing you should have done was get up and leave.” He paused. “Besides Southwest Homes and Tentron, did they ask you about any other transactions?”

“Yes, Ernest-United, Tungsten Steel, and there’s one other. I forget.”

“Burlington Industries? Bethlehem Forge? Val-Tech Industries?”

“Yes—Val-Tech Industries.”

LeClaire thought for a moment. “Anything else?”

“They tapped my phone. And hacked into my computer. And I think Kathy Cella’s since she got to Paris.”

“Go on.”

“And Croonquist said they had detailed trading records and emails on those same deals by institutions all over the world.”

“Did he mention any U.S. institutions?”

“I don’t remember.”

“Do you remember anything else?”

“No.”

“You say you told him you hadn’t done anything wrong?”

“Of course,” Richard said. “And I haven’t, and neither has Kathy, but Croonquist had taped phone conversations between me and Kathy talking about some guy we refer to as the mole.”

LeClaire just looked at him, not moving. Richard had seen that look before, melted under it. Now he wasn’t sure what it meant.

“It’s a long story,” Richard said, “but basically, somebody at Walker in New York sends emails to somebody at GCG in Paris ordering stock trades. We call him the mole. I first discovered it by accident on the Southwest deal and Kathy and I have been observing it as sort of a game. And now it’s obvious that the SEC and the U.S. Attorney’s Office think Kathy and I are part of some kind of insider trading ring.”

“Did Croonquist say the words, ‘insider trader ring’?”

“I think he referred to it as a ‘network.’ But he said he thought they had enough to hold me for insider trading on both Southwest and Tentron. He said if I didn’t cooperate, Holden might drag me out in handcuffs at six in the morning. And Holden threatened they might even drag in my dad.”

LeClaire let out a long sigh and pushed himself back in his chair. “Well, my friend, we better talk to Jack and Steinberg and get you a lawyer. One more thing…”

“What?”

“Who is this mole?” His eyes were probing.

“No idea.”

LeClaire nodded. He picked up the phone and punched the keypad.