Laurent Gillieron/Keystone, via Associated PressMichael Klein, a former investment banking chairman at Citigroup.Putting together a $41 billion merger usually requires a veritable army of bankers and lawyers on both sides of the deal. And indeed, in announcing their union, Glencore International and Xstrata list more than a half-dozen advisers.
But alongside the big firms is a curious addition, “M. Klein & Company.” Which is essentially one man: Michael S. Klein.
That would be the former Citigroup vice chairman, who left the firm in 2008 shortly after helping his then-employer raise billions of dollars from Middle Eastern investor funds. A 1985 graduate of the University of Pennsylvania‘s Wharton School, Mr. Klein joined Salomon Brothers and became known as a top mergers banker. By the time of his departure, he had run Citi’s investment bank and then its institutional clients group.
Since leaving, Mr. Klein has been working more or less on his own as a sort of one-man advisory shop for complex situations. He advised Barclays Capital on its purchase of Lehman Brother’s core banking business months after leaving Citi (and earned a $10 million fee for his services). And he worked for a longtime client, Dow Chemical, on a number of assignments, including a joint venture with Saudi Aramco that was set up last year.
Mr. Klein has also advised a number of governments on various matters, including Britain on its bank rescue plan.
The announcement of the Glencore-Xstrata merger noted that Mr. Klein was a “strategic adviser” to both companies’ chief executives. The role essentially involved being a neutral consultant who understood the complexities of the deal, according to a person briefed on the matter.
Given the tangled ownership stake and cultures of both companies, the chief executives, Ivan Glasenberg of Glencore and Mick Davis of Xstrata, sought an additional adviser who could figure out solutions acceptable to the two companies.