Richard B. Handler

Richard B. "Rich" Handler (born May 23, 1961) is an American businessman, currently serving as the Chairman of the Board and CEO of Jefferies Group,[1] where he is the longest-tenured CEO on Wall Street.[2] Handler also serves as the CEO and director of Leucadia.[3]

Early life and education

Handler grew up in New Jersey, graduating in 1979 from Pascack Hills High School in Montvale.[4] Handler received a BA in economics from the University of Rochester in 1983 and an MBA from Stanford University in 1987.[5] Before graduate school, he worked as an investment banker at First Boston, and after as a junk bond trader for Michael Milken at Drexel Burnham Lambert.[4]

Professional career

Handler joined Jefferies in April 1990 as a salesman and trader[4] and was appointed CEO on January 1, 2001,[6] Chairman in 2002.[4] During his time at Jefferies, between 1990 and 2012, shares compounded annually at 22%.[7] On November 12, 2012, Jefferies announced its merger with Leucadia, its largest shareholder. At that time, Leucadia common shares were trading at $21.14 per share.[8] As of December 31, 2015, Leucadia shares were trading at $17.39 per share.[9] In March 2013, Jefferies merged with Leucadia,[10] and Handler became CEO of both companies.[11]

In April 2012, Handler and Chairman of the Jefferies Executive Committee Brian Friedman formed the Jefferies Global Senior Advisory Board, which now includes James D. Robinson III, Lord Hollick, Michael Goldstein, Bernard Bourigeaud, Dennis Archer, Sir David Reid,[12] Gilles Pélisson,[13] and G. Richard Wagoner.[14] In August 2012, Handler played a lead role in saving Knight Capital Group after they suffered a $440 million loss due to a 'technology glitch.' Together with Brian Friedman, Handler structured and led the rescue,[15] which included making Jefferies the largest shareholder with an investment of $125 million.[16]

In November 2011, ratings company Egan-Jones issued a negative report regarding Jefferies that caused a 20% decline in the Jefferies stock price minutes after the opening bell the following morning.[17] This report was found to contain a number of inaccuracies: Jefferies was accused of having 77% of its shareholder’s equity tied up in the same illiquid sovereign debt securities that had just toppled MF Global, neglecting to mention that the position had been hedged, supposedly offsetting exposure.[18] Chris Kotowski of Oppenheimer & Co. made public statements pointing out additional figures in the Egan-Jones report that were 'so grotesquely wrong they should immediately jump off the page to anyone remotely familiar with the numbers.' This included the false claim that Jefferies revenue had declined 37.8% annually over the previous ‘couple of years.’[19] In fact, Jefferies net revenues actually increased by 154% from 2008 to 2011 according to company filings.[20] The Egan-Jones report was described by Kotowski in his research report from November 23, 2011 titled "Another Hack Attack" as 'flat out wrong',[21] and was followed by what Richard Handler characterized as a multi-week public attack on Jefferies by Sean Egan.[18] Handler and the Jefferies management team responded with unprecedented immediacy and transparency, collapsing 75% of this sovereign debt position in a matter of days to prove the bonds were hedged and highly liquid, sharply reducing the rest of Jefferies balance sheet, and publicly addressing the accusations on an almost daily basis.[22] This aggressive and unconventional response resulted in an eventual rebound in Jefferies share price from the November lows.[18]

Richard Handler is also Chairman and CEO of the Handler Family Foundation and serves on the Advisory Council of the Stanford University School of Business.[23] For the University of Rochester, Handler serves on the Board of Trustees,[24] as Chairman of the Finance Committee,[23] and as Co-Chairman of the university's Capital Campaign.[25] Handler has donated $25 million for the Jane and Alan Handler Scholarship Fund (named for Handler's parents) for exceptional students from underprivileged backgrounds with the potential for future leadership.[26]

Compensation

From 2004 to 2014, 78% of Richard Handler’s compensation has been paid in stock.[7] Assuming Handler continues his employment with Leucadia through all vesting and deferral periods, he will own 11,240,470 shares of Leucadia.[27] Handler has never sold shares of Leucadia or Jefferies, with the exception of charitable donations and a one-time sale for tax purposes.[28] According to the New-York Times,[29] Richard Handler was one of the better paid chief executives on Wall Street when he ran the Jefferies Group ($19 million in 2012). After the Leucadia National Corporation acquired Jefferies, his compensation fell by more than 80 percent due to the disappointing performance of the Jefferies subsidiary. In 2014, Handler turned down a $2.2 million bonus after a year of weak results and a sliding stock for the securities firm's parent company.[30]

References

  1. ↑ Jefferies Officers and Directors Listing http://investor-relations.jefferies.com/od.aspx?iid=102756
  2. ↑ Here Is the City http://hereisthecity.com/en-gb/2014/06/11/best-place-to-work-of-the-decade/
  3. ↑ Letter to Shareholders 2/28/14 http://www.leucadia.com/c-p_letters/luk_c-p2013.pdf
  4. 1 2 3 4 Bloomberg Article 12/19/11 http://bloomberg.com/news/2011-12-19/jefferies-s-intensely-private-handler-lifts-firm-s-veil-to-defend-legacy.html
  5. ↑ Stanford School of Business Bio https://www.gsb.stanford.edu/advisorycouncil/handler.html
  6. ↑ Business Wire http://www.thefreelibrary.com/Jefferies+Announces+Leadership+Change%3B+Richard+Handler+Named+CEO,...-a065822953
  7. 1 2 Jefferies SEC Report 2012 http://www.sec.gov/Archives/edgar/data/1084580/000119312513027253/d438142d10k.htm#tofc438142_18
  8. ↑ "Merger Between Jefferies And Leucadia Secures The Investment Bank's Future". SeekingAlpha. November 13, 2012. Retrieved January 11, 2016.
  9. ↑ "Leucadia National Corporation Historical Prices". Yahoo! Finance. December 31, 2015. Retrieved January 12, 2016.
  10. ↑ NY Times Dealbook http://dealbook.nytimes.com/2014/04/02/handler-leucadias-new-chief-takes-pay-cut-in-new-role/?_php=true&_type=blogs&_php=true&_type=blogs&_r=1
  11. ↑ Jefferies Press Release http://www.jefferies.com/News/PressReleases/201/304
  12. ↑ Reuters http://www.reuters.com/article/2012/04/16/idUS117101+16-Apr-2012+BW20120416
  13. ↑ Jefferies Press Release http://www.jefferies.com/News/PressReleases/201/272
  14. ↑ Businessweek http://investing.businessweek.com/research/stocks/people/person.asp?personId=177132&ticker=GM
  15. ↑ New York Times http://dealbook.nytimes.com/2012/08/06/knight-capital-skirts-collapse-as-investors-offer-lifeline/?_php=true&_type=blogs&_r=0
  16. ↑ Fox Business http://markets.m.foxbusiness.com/quickPage.html?page=32642&content=77699041&pageNum=-1
  17. ↑ Crain's New York http://www.crainsnewyork.com/article/20111106/SUB/311069977
  18. 1 2 3 DealBook NY Times http://dealbook.nytimes.com/2013/12/03/an-unexpected-apology-stokes-the-embers-of-a-feud/
  19. ↑ Businessweek http://www.businessweek.com/news/2011-11-24/jefferies-note-by-egan-jones-flat-out-wrong-kotowski-says.html
  20. ↑ Jefferies Financial Performance http://investor-relations.jefferies.com/Cache/1001188886.PDF?Y=&O=PDF&D=&FID=1001188886&T=&IID=102756
  21. ↑ Value Plays http://www.valueplays.net/wp-content/uploads/Handler-Richard-Oppenheimer-Another-Hack-Attack-11-23-2011.pdf
  22. ↑ Bloomberg on Handler http://www.bloomberg.com/news/2011-12-19/jefferies-s-intensely-private-handler-lifts-firm-s-veil-to-defend-legacy.html
  23. 1 2 Forbes Profile http://www.forbes.com/profile/richard-handler/
  24. ↑ University of Rochester Board of Trustees http://www.rochester.edu/aboutus/trustees.html
  25. ↑ University of Rochester Capital Campaign http://campaign.rochester.edu/volunteer-leadership
  26. ↑ University of Rochester press release http://www.rochester.edu/news/show.php?id=3758
  27. ↑ Leucadia SEC Proxy Statement 2014 - Page 25 http://www.sec.gov/Archives/edgar/data/96223/000093041314001565/c77050_def14a.htm
  28. ↑ Leucadia SEC Proxy Statement 2014 - Page 32 http://www.sec.gov/Archives/edgar/data/96223/000093041314001565/c77050_def14a.htm
  29. ↑ Alden, William (April 2, 2014). "Handler, Leucadia’s Chief, Takes Pay Cut in New Role". The New York Times. Retrieved 13 August 2014.
  30. ↑ Wall Street Journal, "Jefferies CEO to Forgo 2014 Cash Bonus" Feb. 4, 2015. http://www.wsj.com/articles/jefferies-ceo-to-forgo-2014-cash-bonus-1423085825?KEYWORDS=handler

External links

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