While the tech industry digests the news that LinkedIn is becoming an independently run subsidiary of Microsoft in exchange for $26.2 billion in cash, one renowned figure in Silicon Valley is already publicly celebrating the deal: Frank Quattrone.
The legendary investment banker tweeted earlier today that Qatalyst, the boutique bank that he founded eight years ago, served as the lead advisor to LinkedIn on its sale, noting that it’s the “largest sale” of an internet company “ever,” and stating its acquisition price at $28.1 billion.
Maybe that was the price before Qatalyst and Allen & Co., which also advised the company, took their fees, along with Microsofts’s advisers — Morgan Stanley and law firm Simpson Thacher & Bartlett. (We’re half-kidding. The fees were more likely in the tens of millions of dollars, though some top M&A firms charge upwards of 5 percent of a transaction’s value in fees. Qatalyst didn’t respond to our request for clarification.)
Either way, it’s a coup for Quattrone, who was the most prominent banker of the go-go ’90s tech boom and who helped take public Amazon, Cisco, Netscape and other high-fliers before coming under investigation by federal prosecutors. As longtime industry watchers will remember, Quattrone was accused of doling out hot IPO shares to favored clients in exchange for inflated commissions while working as the head of CSFB’s tech banking business. He was later arrested and charged with obstructing justice and tampering with witnesses.
Quattrone’s first trial ended in a hung jury. In a second trial, he was convicted of obstruction of justice, but that conviction was overturned in 2006. Indeed, by August 2006, Quattrone — who earlier in his career spent more than 14 years as the head of Morgan Stanley’s technology group, as well as served as the CEO of Deutsche Bank’s technology group — reached a settlement with the government in which he admitted no wrongdoing. Less than two years later, he launched Qatalyst.
While LinkedIn is now the bank’s biggest win to date, it has been involved in a string of high-profile deals. Among them is OpenDNS’s sale to Cisco for $635 million last year; HomeAway’s sale to Expedia last year for $3.9 billion; and the sale of Ping Identity, a firm that manages employees’ digital identities, to the private equity firm Vista Equity Partners. (Terms of the deal, which was announced just last week, aren’t being disclosed.)
In a deal that Qatalyst might be less eager to advertise than others, it also advised Autonomy on its 2011 sale to Hewlett Packard for $11 billion. HP later took an $8.8 billion write-down on the deal. The company accused Autonomy of improperly reporting $709 million in revenue over two-and-a-half years before the purchase. HP has since split into two companies.
Quattrone stepped down as CEO of Qatalyst Group back in January, becoming chairman of the firm and turning over the reigns to George Boutros, who worked closely with Quattrone at Morgan Stanley, Deutsche Bank, and CSFB before re-joining him at Qatalyst in 2010.
Quattrone told Fortune at the time that he retains a hand in Qatalyst’s strategy while spending more time as a client-focused banker.
Certainly, he takes plenty of pride in his work. Last year, in a lengthy profile about Quattrone’s singular career, he told the WSJ of Qatalyst’s success to date: “You can’t create the Sistine Chapel using paint by numbers. Every deal we do is a custom piece of art.”
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