Two Former Top Executives Disavow Dissidents’ Proposal To Break-Up Firm
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Joseph Perella and Terry Meguid, the top investment bankers who quit Morgan Stanley last month, said they don’t back a dissident proposal that would split up the securities firm and return them as senior managers.
Under the plan, the latest step in an effort by eight Morgan Stanley alumni to push the chief executive, Philip Purcell, aside, Mr. Perella, 63, would be reappointed a vice chairman and Mr. Meguid, 49, would be one of three executives sharing a new office of the president. In statements made available by Morgan Stanley, where they still maintain offices, both Messrs. Perella and Meguid said they had nothing to do with the proposal.
“I was not involved in the preparation of the report entitled ‘Presentation to the Shareholders of Morgan Stanley’ dated May 12, 2005, and I gave no authorization for the use of my name in that report,” each of the statements said.
The alumni group, led by ex-President Robert Scott, was counting on Messrs. Perella and Meguid to participate, saying on May 12 it was “highly confident under this management structure these former executives would return.” It’s also trying to lure back Stephan Newhouse, whom Mr. Purcell demoted as president March 28, Vikram Pandit, and John Havens.
Mr. Scott’s group wants to return Morgan Stanley to what it was before a 1997 merger with Mr. Purcell’s Dean Witter, Discover & Company. The firm would be split into an investment bank, retaining the Morgan Stanley name, and a separate company led by Mr. Purcell, 61, housing its brokerage, asset management and credit card units.
Mr. Scott himself would be interim CEO of the investment bank. Mr. Pandit, 48, the former division head responsible for mergers, underwriting, and institutional sales and trading, and Mr. Havens, 48, Mr. Pandit’s deputy in equities, would join Mr. Meguid in the president’s office, according to the May 12 proposal, outlined in a 21-page presentation.
Messrs. Meguid and Perella’s statements were reported earlier by the New York Post.
A spokesman for Mr. Perella, Tim Metz, declined to comment. Mr. Meguid didn’t return a message left at his office. Mark Lake, a Morgan Stanley spokesman, declined to comment.
Last week, Mr. Lake termed the proposal a “publicity stunt.”
The presentation marked a change of tack for the eight former Morgan Stanley executives, who had focused their efforts for six weeks on getting the board to oust Mr. Purcell. The firm’s directors rejected that demand and on May 1 declared its support for Mr. Purcell.
