CIT: The Boys are Back, King Farouq of Wall Street……….
“CIT Group Inc. tapped the former Merrill Lynch CEO to become its chairman and chief executive. Thain brokered Merrill's sale to Bank of America as the credit crisis peaked in the fall of 2008, but was then pushed out the door after the deal closed as controversy swirled around bonus payments and mounting losses at the investment bank…….. Investors reacted positively to the announcement that Thain will take the helm of the lender, which is based in New York. Its shares rose $1.25, or 5.7 percent, to $32 in premarket trading. CIT will pay Thain an annual cash salary of $500,000. He will also receive $5.5 million in stock annually, of which $2.5 million will be subject to a one-year holding period. The remaining $3 million cannot be sold for three years. Thain could also receive up to $1.5 million in bonuses based on the performance of the company. The board of directors will determine whether to award the performance-based bonuses……..”
“In early 2008, just as Merrill Lynch CEO John Thain was preparing to slash expenses, cut thousands of jobs and exit businesses to fix the ailing securities firm, he was also spending company money on himself, senior people at the firm say. According to documents reviewed by The Daily Beast, Thain spent $1.22 million of company money to refurbish his office at Merrill Lynch headquarters in lower Manhattan. The biggest piece of the spending spree: $800,000 to hire famed celebrity designer Michael Smith, who is currently redesigning the White House for the Obama family for just $100,000. The other big ticket items Thain purchased include: $87,000 for an area rug in Thain's conference room and another area rug for $44,000; a "mahogany pedestal table" for $25,000; a "19th Century Credenza" in Thain's office for $68,000; a sofa for $15,000; four pairs of curtains for $28,000; a pair of guest chairs for $87,000; a "George IV Desk" for $18,000; six wall sconces for $2,700; six chairs in his private dining room for $37,000; a mirror in his private dining room for $5,000; a chandelier in the private dining room for $13,000; fabric for a "Roman Shade" for $11,000; a "custom coffee table" for $16,000; something called a "commode on legs" for $35,000; a "Regency Chairs" for $24,000; "40 yards of fabric for wall panels," for $5,000 and a "parchment waste can" for $1,400……..”
It looks like the boys are back. Fasten your seat belts, folks, for the next wild ride.
I may have been maligning the potentates of the Middle East too much here. I have been in many of their offices, and some of their homes (just slumming), and I don’t believe any of them had anything like Mr. Thain put in his “offices”. They never used a $1,400 waste bin, or maybe I am not good at assessing trash bins. These reports make it sound like he was born with a silver trash bin…….on his head.
Cheers
mhg
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