Barbarians at the Gate Book Review

Click Here To Purchase "Barbarians at the Gate"

Product: Barbarians at the Gate: The Fall of RJR Nabisco

Company Name: Harper Paperbacks
Company Web Site: http://www.amazon.com
Twitter Account: http://twitter.com/HarperCollins
Headquarters: New York
Founded: n/a
Category: Books

Description of Product:

In late 1988, RJR Nabisco was purchased by KKR (Kohlberg Kravis Roberts & Co.) for approximately $25 billion, or $109 per share.

The LBO (leveraged buyout) was the largest in history (at the time). The fact that the buyout involved one of the most prestigious companies in America (RJR Nabisco owned many brands including Oreos, Ritz Crackers and Fig Newtons) made the story even bigger.

This book focuses on the frenzied bidding for RJR Nabisco that took place once Ross Johnson, the CEO of the company, first announced his plans for a management-led LBO of the company.

Total Reviews: 1

Average Rating:

Total

Ratings: 1
Total

Ratings: 0
Total

Ratings: 0

Reviews:

Dave, Friday, February 26, 2010

Wow! What a book - who knew that a leveraged buyout could end up being so interesting?

This book is a COMPREHENSIVE retelling of the events that led up to the purchase of RJR Nabisco by KKR (Kohlberg Kravis Robert) in the late '80s.

This story is notable not only because of the retelling of the bidding war for RJR Nabisco, but also because it takes place during the last days of the Drexel Burnham Lambert inspired LBO boom of the late '80s. In classic boom fashion, the stampede of companies into the LBO scene signaled that the end was soon near.

It was interesting to read about the true reasons for companies being interested in RJR Nabisco at the time. It was less and less about the actual company, and more about egos, fees and prestige.

Some companies wanted to get involved in the purchase of RJR Nabisco just to rack up some impressive fees. Some companies tried to get involved in a desperate attempt to resurrect their firms. Some companies wouldn't allow themselves to be outbid, even if it allowed for the possibility of dangerously overpaying for the company. One company wanted to get involved, just for the sole reason that every other firm was already invested in the potential transaction in some way. As I say - less about the company, and more about egos and fees and prestige.

I will say a few things here:

1. If you aren't intensely interested in the markets, you will likely not make it through this book. If you skip CNBC when you are flipping through the channels, then this book probably isn't for you. It's very interesting, but you probably won't make it. Just being honest.

2. Things really pick up about 1/4 of the way into the book. The book goes into EXQUISITE detail re: the backstories of the main characters involved in the battle for RJR Nabisco. This is the gift and the curse of the book - the gift in that you are truly invested in the story and the people in it when the book really starts to pick up, and the curse in that the book probably loses many people in the first quarter. This is a great book, but I'm betting that many people give up on it. This isn't the fault of Bryan Burrough and John Helyar (the authors) though - they do a tremendous job in making the histories of all of the people and companies involved as easy to digest as possible. Knowing so much about the characters and companies involved MAKES the book and the story.

One other note - it's interesting to me is that many of the companies and people involved in the bidding for RJR Nabisco (KKR, Forstmann Little, etc) are still prominent today.

Again - excellent book, but you have to invest some time slogging through the first 25% of the book to get to the really great parts. As soon as Ross Johnson announces his intentions to lead a management LBO of RJR Nabisco, all hell breaks loose and things start to get VERY entertaining.

--