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									   proxy  IR magazine

  Searching for
                                           Don Carter
              ou know the Donald           At the height of the go-go 1980s, the Carter Organization
              (Trump) and the Don
                                           was the breeding ground for many of today’s top proxy
              (Tony Soprano). What
              about IR’s own Don           experts. Mary Lowengard tracks down the Don
              Carter? Some 20 years
   ago the eighth floor of 237 Park                       that roamed the office. Carter’s executive lair was
   Avenue served as the nerve center                      featured in several scenes in Oliver Stone’s Wall Street,
   for a takeover wave led by iconic                      the 1987 film in which Michael Douglas, as financier
   figures such as Saul Steinberg,                        Gordon Gekko, declared: ‘Greed is good!’
   Irwin Jacobs, T Boone Pickens,                             TCO itself was bought by UK advertising agency
   James Goldsmith, Robert Maxwell,                       Valin Pollen in 1987. The $50 mn price tag was jaw-
   Carl Icahn and Rupert Murdoch.                         dropping back then, and a tidy return on $3,000 in
       At number 237 another iconic                       start-up investment. TCO became Carter Valin Pollen
   figure set up shop, transforming in                    and business thundered ahead, motivated perhaps by
   just a few years the business of                       the additional $60-plus mn promised should Carter
   proxy solicitation dominated until                     reach profit targets.
   then by DF King and Georgeson.
   Collecting corporate ballots had                       Learning from the master
   been a merely mechanical job                           Flash forward to 1990. The kingdom of Carter was
   until the Carter Organization (TCO)                    being dismantled, Valin Pollen was preparing to sue
   blew onto the scene in the mid-                        to recover its money, and Carter was packing for a
   1970s, turning it into a powerful                      16 months to four-year sentence in New York state
   weapon. By 1987 Carter had more                        prison, having pleaded guilty to larceny and fraud. In
   than 100 employees and revenues                        the annals of white-collar crime, it was a classic: Wall
   of $35 mn a year.                                      Street mover-and-shaker fashions wings of wax, flies
       TCO’s offices were the stuff of                    too close to the sun, crashes and burns.
   1980s legend. On entering the                              But Carter’s lieutenants did not go down in flames
   building, visitors passed by a floral                  with him. Indeed, many stayed in the business and now
   arrangement that probably cost                         hold senior positions in other proxy firms. For example,
   more than the weekly salary of the                     two former Carter deal brokers, Edward McCarthy
   receptionist. Smoked glass doors                       and Rick Grubaugh, are today senior vice presidents
   parted silently, leading into a                        in the extraordinary events unit at DF King, where
   complex that included the ‘war                         they landed after forming Beacon Hill.
   room’, an aquarium stocked with                            ‘Those were long days we put in,’ recalls McCarthy
   piranhas and a cat named Stretch                       affectionately. He started at TCO in 1986 fresh out of

42 September 2007
                                                                      IR magazine  proxy


     Then                                                      an executive managing director at
                                                               the Altman Group, working with Jim
                                                               Gaffney, senior managing director.
                                                               Gaffney also made a pit stop at
                                                               Georgeson. And John Siemann is at
                                                               Georgeson as a managing director.
                                                               He recalls: ‘It was crazy, it was fun,
college. ‘Both Rick and I worked our way through the           and not for nothing we were the
ranks. We worked side-by-side with Don on all the big          best on the Street.’
fights. It was like learning from...’ - he pauses, giving          Also at the top of their game
emphasis to his words - ‘...the Master.’ McCarthy              are Scott Ganeles, CEO of market
refers to TCO as the ‘Harvard Business School of               intelligence firm Ipreo, having pre-
proxy contests’.                                               viously served as president of the
     ‘One of the nicest offices I ever worked in,’ claims      Carson Group, a stock surveil-
one former staffer. ‘A phenomenal learning experience,’        lance firm started by a Carter
says another. ‘They paid us peanuts, but we didn’t care,’      colleague, David Geliebter.
recalls a third. ‘It was all about the thrill of winning       Geliebter had come late into the
the fight.’                                                    game and served as Carter’s
     Tracking down the principals and worker bees from         marketing director. Today he’s
the Carter Organization is not difficult, thanks to the ties   heading up Carrot Capital, which
that bind the close-knit investor relations community.         he founded after Carson was sold
Dennis Mensch, described by his former colleagues              to Thomson Financial in 2000. (To
as ‘the one who did all the work’, can be found at             set the record straight, Carson
Morrow & Co. Also at Morrow are Fred Marquardt and             was not named in homage to
Ron Knox. Two decades ago, Knox was in Carter’s                Carter – ‘son of Carter’ – but
special situations group and Marquardt was running             after one of Geliebter’s children.)
the shareholder ID and broker nominees side. Now                   Further afield is David Kahn,
sitting at desks at Innisfree M&A are Michael Brinn and        who is living in California and
Alan Miller, both former high-level Carter executives.         working as a portfolio manager at
     Paul Schulman went first to Georgeson and is now          Wilmington Trust. Kahn was the boy

                                                                                      September 2007 43
   proxy  IR magazine

   wonder who ran TCO’s stock-surveillance group. He
   is married to Joan, née Ferguson, who was the
   assistant to Robert Hubbell, an executive brought
   in after the Valin Pollen deal with a mandate to grow
   an IR consulting practice. Hubbell went from Carter
   to Edelman Public Relations to Andersen Worldwide.
   Today he’s managing director of communications and
   marketing at Cantor Fitzgerald.
       Another who wandered over to the corporate side
   is Jack Carsky. After TCO collapsed, he spent time
   with CIC and Thomson, eventually landing a job at the
   American Stock Exchange. This helped him snag an
   IRO position at Providian Bank in 1998, where he
   remained until it was taken over by Washington Mutual.
   That’s where he was serving as vice president of fixed
   income IR until this summer when he decided to take
   some break time. He too found romance in the office,
   meeting his wife at TCO.

   Life after prison 
   And what about Don Carter himself? Since leaving
   prison in 1991 and failing to have his guilty plea
   overturned (he successfully had it voided in the fall of
   1998, but this was overturned on appeal the following
   February), he’s moved to Palm Beach. ‘I love Florida,’
   he proclaims, ‘I don’t miss New York. I’m just sorry it
   took me so long to get here.’
       In true Gatsby-like fashion, Carter has reinvented
   himself as a private investor with interests in energy
   development and private equity, and runs a multi-          Top to bottom: Edward
   family office. He still socializes professionally with     McCarthy, Paul Schulman,
   former TCO clients such as T Boone Pickens and             Scott Ganeles, Don Carter
   Michael Boswell of Sunshine Mining. ‘I invest in
   [Boone Pickens’] hedge funds and provide private
   financing for REITs,’ he discloses. The once avid          from Carter’s new lifestyle and
   Fantasy Baseball Camp participant confides, ‘My            put Gordon Gekko on Trump’s
   fantasy these days is to get through yoga four times a     Palm Beach golf course instead
   week.’ Golf is now his passion. Carter flew up to make     of confining him to the canyons
   an appearance last winter at a small reunion of TCO        of Manhattan.
   alumni in New York, professing surprise afterwards at          As for Stretch, the cat was
   learning for the first time of the numerous romantic       adopted by the foreman of the
   mergers that once went on under his nose.                  crew renovating Carter’s Long
       Meanwhile, from Hollywood comes the news that          Island estate. She was last seen
   20th Century Fox is working on a sequel to Wall            wandering the grounds looking
   Street. Perhaps the screenwriters will take a clue         for some action. n

44 September 2007

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