Obituary: Corporate lawyer Joseph Flom transformed business world with mergers, takeovers
Thursday, February 24, 2011; 9:09 AM
Joseph H. Flom, a lawyer whose expertise and ruthlessness in corporate mergers and acquisitions reshaped America's business landscape during the 1980s and helped turn his tiny New York firm into one of the nation's largest law practices, died Feb. 23 at a hospital in New York.
He was 87 and had a pulmonary embolism, said his wife, Judi Flom.
Mr. Flom was widely acknowledged as a master architect of hostile takeovers, in which a raider purchases a target company without consent.
Such unwanted advances by corporate suitors had long been scorned as dirty business by white-shoe law firms. To Mr. Flom - who grew up poor in Brooklyn, N.Y., and talked his way into Harvard Law School without earning an undergraduate degree - high-stakes takeovers were a path to power and profitability.
He and his firm - which became Skadden, Arps, Slate, Meagher and Flom - were involved in nearly every major merger and acquisition fight of the 1970s and 1980s, including U.S. Steel's multibillion-dollar takeover of Marathon Oil, Chevron's purchase of Gulf Oil and RJR Holdings' purchase of Nabisco.
More recently, Mr. Flom represented Anheuser-Busch in 2008 when it was purchased by the Belgian brewer InBev in a $52 billion deal.
He was best known for mapping strategies on behalf of buyers, often engineering costly and risky lightning raids in which his clients attempted to take over companies by offering more than market rate for shareholders' stock.
But Mr. Flom was so feared as an adversary that he was frequently paid handsome retainer fees by companies nervous about becoming takeover targets.
This was a practice known in the business, according to a 1994 book about Skadden, Arps by journalist Lincoln Caplan, as "sterilizing Joe" - as long as Mr. Flom worked for you, he couldn't come after you.
"I have no preferences for being on one side or the other," Mr. Flom told the Times of London in 1988. "The only thing I cannot stand is not being on either side."
Whether on offense or defense, Mr. Flom relished his reputation as a street fighter willing to go to any length to win. Caplan noted the lawyer's habit of jabbing a cigar "close to the face of someone he was talking to, without apology."
When a Flom client, the Mead paper company, was threatened with takeover in 1978, he launched a private investigation into wrongdoings by the raider, Occidental Petroleum, and its chief executive, business tycoon Armand Hammer.