Jump to content

Cogan, Berlind, Weill & Levitt

From Alfawiki
Cogan, Berlind, Weill & Levitt
Company typePrivate
IndustryInvestment banking, Brokerage
Founded1960
FounderArthur L. Carter, Roger Berlind, Peter Potoma, Sanford I. Weill
Defunct1972
FateAcquired and merged into Hayden Stone, later Shearson Loeb Rhoades
Headquarters
New York City
,
United States
Key people
Sanford I. Weill, Arthur Levitt, Arthur L. Carter, Marshall Cogan, Roger Berlind, Peter Potoma

Cogan, Berlind, Weill & Levitt, initially established as Carter, Berlind, Potoma & Weill, was a prominent American investment banking and brokerage firm created in 1960 and later purchased by American Express in 1981. Over a span of more than twenty years, it functioned as a platform for the consolidation of over a dozen brokerage and securities companies under the leadership of Sanford I. Weill, ultimately leading to the creation of Shearson Loeb Rhoades.

The firm’s principal partners comprised Sanford I. Weill, Arthur Levitt, Arthur L. Carter, Marshall Cogan, Roger Berlind, and Peter Potoma.

Early history

In May 1960, Arthur L. Carter, Roger Berlind, Peter Potoma, and Sanford I. Weill launched Carter, Berlind, Potoma & Weill with an initial capital investment of $200,000. The company’s first office was located at 37 Wall Street, later relocating to 60 Broad Street and subsequently to 55 Broad Street. During its inaugural year, the firm achieved revenues of $400,000.

Starting as a modest research-focused boutique delivering brokerage and investment banking services, it earned the nickname "the Jewish DLJ," a nod to the investment bank Donaldson, Lufkin & Jenrette.

In 1962, following Peter Potoma’s suspension for "free riding," the remaining partners compelled his departure and renamed the company Carter, Berlind & Weill. The following year saw the addition of future SEC Chairman Arthur Levitt, while in 1964, Marshall Cogan joined as an automotive sector research analyst before becoming a partner.

By 1965, Weill assumed the chairmanship and steered the firm through an era characterized by Wall Street consolidation involving over fifteen acquisitions. The initial purchase was Bernstein-Macaulay Inc., an investment management company founded by Peter L. Bernstein, acquired in 1967.

Arthur Carter divested his interest in 1968 to focus on media ventures including The Nation and The New York Observer. On February 19, 1969, with Marshall Cogan and Arthur Levitt joining as partners, the firm adopted the name Cogan, Berlind, Weill & Levitt (CBWL), colloquially dubbed "Corned Beef With Lettuce." That year, CBWL recorded revenues totaling $19 million.

CBWL also served as a training ground for future Wall Street executives: Peter A. Cohen joined in 1970 and became special assistant to Weill by 1973; he later assumed roles as chairman and CEO of Shearson Lehman Brothers and currently leads Cowen Group. Meanwhile, Joe Plumeri, who eventually became president of Shearson Lehman Brothers and CEO of Willis Group Holdings, started at CBWL during the 1960s as a part-time clerk despite initially mistaking it for a law practice.

Acquisition of Hayden Stone

On September 11, 1970, after acquiring Hayden, Stone & Co., the firm rebranded as CBWL-Hayden, Stone, Inc. to capitalize on the recognition of the larger yet financially troubled Hayden Stone. Established in 1892, Hayden Stone maintained an extensive retail branch network alongside substantial investment banking operations. It reported $113 million in revenue for 1968—a fivefold increase since 1960—but encountered administrative difficulties during the late 1960s that resulted in trading restrictions imposed by the NYSE. By 1970, control had shifted to creditors. CBWL purchased most of Hayden Stone's assets including its brand name, 28 branches staffed by approximately 500 brokers, and roughly 50,000 client accounts. This acquisition elevated CBWL from relative obscurity to a significant force on Wall Street. In that year, the merged entity employed more than 1,500 individuals and generated close to $12 million in revenue.

The impact of this acquisition was so significant that by 1972 the CBWL designation was dropped in favor of Hayden Stone, Inc. In August 1973, co-founder Marshall Cogan departed amid internal partner disagreements to pursue leveraged buyout opportunities. Subsequently, Cogan acquired companies such as General Felt Industries, Knoll, 21 Club, and Sheller-Globe Corporation, although he was unsuccessful in attempts to purchase the Boston Red Sox, Sotheby's, and L.F. Rothschild.

Expansion through Consolidation in the 1970s – Shearson Hammill

Following the acquisition of Hayden Stone, the company pursued further growth via additional purchases. In 1973, amidst a turbulent stock market downturn, it took over H. Hentz & Co., a venerable investment banking and commodities firm established in 1850, along with Saul Lerner & Company.

By 1974, deteriorating economic conditions allowed Weill to secure Shearson, Hammill & Co., which had been founded in 1902. The combined organization adopted the name Shearson Hayden Stone, leveraging Shearson’s widely recognized brand, popularized through prominent television advertisements during the 1960s. At this stage, the firm maintained 63 branches both within the United States and internationally and boasted a robust securities research division.

After consolidating operations by 1976, Shearson Hayden Stone acquired Lamson Brothers & Co., a commodities brokerage dating back to the 19th century, as well as Faulkner, Dawkins & Sullivan, a regional brokerage distinguished for its equity research capabilities. By 1977, the merged entity ranked as the seventh largest investment bank in the U.S., generating $134 million in revenue—over three times its 1972 figure—and employing more than 4,000 personnel nationwide.

Completing the Merger – Loeb Rhoades

In 1979, Weill and Shearson Hayden Stone finalized a significant merger by acquiring Loeb, Rhoades, Hornblower & Co., resulting in Shearson Loeb Rhoades, which became the second-largest investment banking firm with $250 million in capital, second only to Merrill Lynch, Pierce, Fenner & Smith.

Before this merger, Loeb, Rhoades & Co. was among Wall Street’s oldest firms. In 1977, it had merged with Hornblower, Weeks, Noyes & Trask to form Loeb, Rhoades, Hornblower & Co., but integrating their back office functions proved expensive and challenging. By late 1978, the merged company was experiencing multimillion-dollar losses. In 1979, Loeb and Shearson agreed to merge into Shearson Loeb Rhoades, with Weill appointed CEO and John Loeb serving as chairman.

Acquisition by American Express

In 1981, Shearson Loeb Rhoades was purchased by American Express for roughly $930 million in stock, creating Shearson/American Express. This organization later evolved into Shearson Lehman Brothers after acquiring Lehman Brothers in 1984. In 1993, American Express divested Shearson Lehman Brothers through an IPO of Lehman Brothers and sold off the core Shearson business to Sanford I. Weill’s Primerica.

Prominent Former Personnel

Acquisition history

Below is an overview of CBWL's significant mergers and acquisitions that ultimately integrated the company into Shearson/American Express and subsequently Shearson Lehman Hutton (this list is not comprehensive):


See also

Further reading

Retrieved from "https://www.alfawiki.org/index.php?title=Cogan,_Berlind,_Weill_%26_Levitt&oldid=20873"