Hugh Brown/AP - Saul P. Steinberg, who critics say used Reliance Insurance Co. as a personal piggybank, taking out hundreds of millions of dollars to fund an opulent lifestyle and his many adventures in corporate raiding died Dec. 7 at his home in Manhattan. He was 73.
Saul P. Steinberg, an audacious financier and corporate raider who often drew as much attention for deals that did not happen as for those that did and who often earned millions of dollars either way, died Dec. 7 at his home in Manhattan. He was 73.
His daughter Laura Tisch Broumand confirmed the death but did not disclose the cause.
Before his business collapsed into bankruptcy about a decade ago, Mr. Steinberg embodied a risk-embracing, sometimes freewheeling approach to business abetted by high-risk, high-yield “junk bond” financing in the 1980s. He earned multiple fortunes that enabled an almost impossibly sumptuous lifestyle, and his wealth thrust him into New York’s cozy nexus of finance, high society and philanthropy.
Mr. Steinberg’s ambition first manifested itself at the University of Pennsylvania’s Wharton business school in the late 1950s. Using a loan from his father, a Brooklyn rubber company owner, the younger Mr. Steinberg developed the idea to lease used IBM computers to small businesses.
Leasco Data Processing Equipment Corp., as Mr. Steinberg’s firm became known, made Mr. Steinberg a millionaire by the time he reached 30. The company went public in 1965, and three years later, it acquired Reliance Insurance Co. of Philadelphia on borrowed money. At the time, investors marveled and quaked at how the much smaller Leasco was able to take over Reliance, a $700 million firm with a pedigree dating to the early 19th century.
“You watch: like the Rockefellers, I’ll own the world,” he told the financial journalist Dan Dorfman at the time. “I could even be the first Jewish president.”
After the Reliance deal, Mr. Steinberg set about buying Chemical Bank, the nation’s sixth largest commercial bank. He was rebuffed, but the effort cemented Mr. Steinberg’s reputation as a man to watch out for. He drew the attention of regulators in Washington as well as business moguls who did not want him muscling in on their companies.
Through the economic malaise of the 1970s, Mr. Steinberg suffered financial setbacks, but he restructured the company and spun off some operations that brought Reliance massive infusions of cash. Flush with funds, he made a run at the Walt Disney Co. in 1984, buying up company stock and ruminating publicly about his intention to take over the company.
In what is often derisively called “greenmail,” Disney bought back Mr. Steinberg’s shares at a premium, and Mr. Steinberg reportedly made a profit of nearly $60 million. The Philadelphia Inquirer reported that Mr. Steinberg had earlier made millions with this strategy from Quaker State motor oil and the Penn Central railroad, among other companies.
At various times, Reliance’s holdings included the Days Inn hotel chain and Telemundo, the Spanish-language television network.
To finance his assertive approach to business ventures through the 1980s, Mr. Steinberg enlisted the help of a fellow Wharton graduate, financier Michael Milken. Mr. Steinberg borrowed hundreds of millions of dollars, using junk bonds issued by Milken, to finance his takeover bids and underwrite his increasingly grandiose lifestyle.
