Barbarians at the Gate: The Fall of RJR Nabisco

by Bryan Burrough

This is a business for people who don’t have money, but who know somebody who has money, but who doesn’t put it up either… JACKIE MASON, “What the Hell is an LBO?”

flying by the seat of his pants.

rent asunder.

stagnated.

“I learned,” he said, “you always tell people how badly you’ve been running the goddamned company, so they’ve got some upside.”

Dutch uncle.

He was having a grand time. “A few million dollars,” he always said, “are lost in the sands of time.”

The basics of an LBO were relatively simple and familiar to all three men. A firm such as Kohlberg Kravis, working with a company’s management, buys the company using money raised from banks and the public sale of securities; the debt is paid down with cash from the company’s operations and, often, by selling pieces of the business.

this side of heaven.

“Imagine ten debutantes sitting in a ballroom,” Forstmann told a gathering of Securities and Exchange commissioners. “They’re the heads of Merrill Lynch, Shearson Lehman, and all the other big brokerages. In walks a hooker. It’s Milken. The debutantes wouldn’t have anything to do with a woman who sells her body for a hundred dollars a night. But this hooker is different. She makes a million dollars a night. Pretty soon, what have you got? Eleven hookers.”

Carolyne Roehm’s

the three rules of Wall Street: “Never play by the rules. Never pay in cash. And never tell the truth.”