THE PREDATORS' BALL: The Junk-Bond Raiders and the Man Who Staked Them by Connie Bruck
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THE PREDATORS' BALL: The Junk-Bond Raiders and the Man Who Staked Them

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KIRKUS REVIEW

Intriguing reportage on the overreaching man and upstart securities firm that added junk bonds to the tricks of the takeover trade. Initially at least, Bruck's project had the cooperation of top executives at Drexel Burnham, whose resident genius, Michael Milken, almost single-handedly--and quite single-mindedly--created a market worth upwards of $150 billion in high-yield debt instruments with less than investment-grade ratings. Though she interviewed nearly 300 people, the author did not gain entrÉe to Milken until late last year, roughly 12 months after Ivan Boesky confessed to insider trading and put federal authorities in pursuit of sometime associates. Despite her obvious conviction that Milken and Drexel committed indictable offenses, Bruck delivers a generally measured account of how they became Wall Street legends. Originally, Milken (who joined Drexel out of Wharton in the early 1970's) viewed high-yield bonds as relatively low-risk trading vehicles and a means of raising money for mid-size enterprises that lacked access to capital markets. In fairly short order, the secretive Milken attracted the allegiance of portfolio managers seeking generous returns, and Drexel emerged as the number-one underwriter of so-called junk issues. When merger mania began convulsing corporate America during the 1980's, the Milken/Drexel combine moved aggressively to provide war chests for raiders like Carl Icahn (now chairman of TWA) and Ronald Perelman (Revlon's conqueror). While neither Milken nor Drexel has been formally charged with any crimes, Bruck makes it abundantly clear their lucrative success in bankrolling speculative acquisitions was not wholly attributable to vision and diligence. Indeed, it seems quite likely that Milkon's large network of loyal clients and industry allies (who attend a yearly conference known in the financial community as ""the predators' ball"") engaged at his behest in activities that were at best collusive. Although she gives her secretive, workaholic subject his due as an innovative challenger of the establishment, the author leaves little doubt that he's a man who might have given Ayn Rand pause. Messianic, manipulative, and utterly obsessed with control, Milken seems to have been incapable of distinguishing between synchronicity and conflicts of interest. Just what's in store for Milken and the brokerage house that's his employer remains to be seen. In the meantime, Brock offers an absorbing and damning brief on an odd but consequential couple that should stand up to any turn of events.

Pub Date: June 29th, 1988
Publisher: Simon & Schuster