The First Billion

"If it were anyone else, I might agree. But this guy's reputation's too good. He's no pump-and-dump artist. And Mercury's no pe

"The question remains, why is he taking aim at us?" Llewellyn-Davies pursed his lips and put a finger to his chin, and Gavallan noticed that his skin had taken on a peculiar yellowish cast. He couldn't help thinking the man looked even thi

"I suggest we call Cisco right away," Llewellyn-Davies went on. "Tell them we're double-checking, engaging in a round of last-minute due diligence." Rising to his feet, he picked up Gavallan's phone and dialed 9 for the main operator. "Let's see if there's anything to this."

An astonished voice bellowed across the room. "Put that fuckin' phone down, Two Names."

Bruce Jay Tustin stormed into Gavallan's office, his cheeks flushed, eyes afire. "What a disaster! I can't believe this son of a bitch. Christ, Jett, what did you do to get this guy so pissed off at us- spill a couple drops on his shoe in the men's room? I mean, this sounds personal. Fuckin' Hatfields and McCoys."

Llewellyn-Davies lowered the phone. "We'll thank you to keep a civil tone, Mr. Tustin."

"Excuse me, your majesty," said Tustin, curtsying before Llewellyn-Davies. "Call Cisco and word will be out before lunch that we're having doubts about our client. I can hear it now. 'The hotshot investment bankers who don't know if the biggest IPO they've ever brought to market is a 'scam dog with mucho fleas.' Jesus, you queens and your dramatics." He put on a terrible English accent and walked mincingly around the room. " 'I suggest we call Cisco right away. Just say we're double-checking, what?' What is it, Tony? Those cocktails you take every day starting to include a little gin?"

"Piss off, Bruce. You're a fucking cretin."

"Excuse me for breathing. When did you get such a thin skin?"

"Cool it, you two," said Gavallan. He was in no mood for Tustin's theatrics or his bullying, but he had enough respect for the man to give his counsel a hard listen. Bruce Jay Tustin was the firm's resident historian, its link to the past. He'd come up on Wall Street in the heyday of greenmail, leveraged buyouts, and insider trading, in an era when news of a twenty-billion-dollar merger shook the world and of a man's taking home five hundred million dollars in salary enraged the masses. At one time or another, Bruce Jay Tustin had worked with all the great names- Henry Kravis, Boone Pickens, Carl Icahn- and some of the not so great ones- Ivan Boesky, Martin Siegel, Mike Milken. He was rude, maladroit, and pathologically disrespectful. He was also savvy as hell, and he wasn't shy about shining his Diogenes lamp on Black Jet's own offerings.

"Bruce has a point," said Gavallan. "Best if we keep our lips sealed for the moment."

Llewellyn-Davies replaced the phone in its cradle, but not before whispering a catty, "Fuck you, Bruce."

Gavallan returned his attention to Tustin. "You think it's personal too? What gives you that idea?"

"Hell, I don't know, but what's all that stuff about pride and 'you lowlifes' and canceling a deal at the last minute 'for less of a reason'? Guy sounds like as much of an asshole as me."

"I won't argue with you there." The truth was that Gavallan had also thought the Private Eye-PO's latest remarks sounded personal. Something in his words rang a bell, and though Gavallan couldn't quite put his finger on it, it disturbed him nonetheless to think that somewhere in the past he'd wronged someone badly enough that the person would seek him out and try to return the favor. "You remember anyone we cut off at the last minute?"

"Last minute?" asked Tustin. "Two years ago we canceled the whole goddamn slate overnight. We had eight companies registered that we had to shelve. I think we ended up saving two of 'em. The others went back for more rounds of funding or got snapped up by bigger fish."

"I'll do some checking," volunteered Tony Llewellyn-Davies. "See how many issues we pulled in the last five or six years."

"What's the word on the street, anyway?" Gavallan asked Tustin. "Anyone buying this guy's shtick?"

"Fidelity's already been on the horn with me, and so has Vanguard. I told both of them the guy was full of shit, but Fidelity cut their order. Said they didn't like the Eastern European exposure. If you ask me they're go

Gavallan ran a worried finger across his chin. Fidelity was the nation's largest manager of mutual funds. If it backed out, others would too. "Anyone else call?"

"Scudder and Strong," offered Llewellyn-Davies, giving the names of two more influential funds. "Not to worry. They're still buyers, both of them, and looking to build a big position in a couple of their funds. I'm sure we'll hear from others in the course of the morning."

As it so often did, the market was sending Gavallan contradictory signals. Someone believed the Private Eye-PO. Someone else thought he was a raving lunatic. It was a constant game of tug-of-war. Gavallan likened it to guessing which way the wind would turn, and felt the only thing to do was to sniff the air and go on your own instincts. He walked to the window and looked down on the city. The streets were glossy and gray and crowded with automobiles.

As if reading his thoughts, Tustin asked, "You're not thinking of postponing the offering?"

"Might not be an unwise move," mused Llewellyn-Davies. "Give us time to sort everything out. Set this Private Eye-PO chap straight."

"It would be a very unwise move, and we all know it," Gavallan replied sharply. "The question is whether we have a choice. Word hits that Fidelity's cutting their order and others might follow suit. It could kill us."

He watched Tustin and Llewellyn-Davies exchange concerned glances. For all their adversarial banter, the two were close friends. A year earlier, when Llewellyn-Davies had suffered a relapse, Tustin had visited him nightly, bringing books and videos and sometimes sneaking in a plate of the Englishman's beloved five-alarm curry from his favorite Indian restaurant.

"I thought we were safe on that one," said Tustin, his swagger conspicuously absent.

"It's spread out," said Gavallan. "Lehman and Merrill took ten apiece, but it's still a handshake deal. Best case, we're left holding thirty million."

"That's a high price to win some business, Jett old boy."

"Maybe," said Gavallan.

They were talking about the bridge loan he had floated Mercury to win the deal: a short-term, fifty-million-dollar facility to help the company tie up real estate, purchase much-needed hardware, and lease fiber-optic cable. In good times, bridge loans were a wonderful way to leverage the fees a bank could earn on a transaction. You were out the money maybe ninety days. You charged a juicy premium over prime. And you won the loyalty of your client by showing faith and shouldering some of his risk.

But these weren't good times, and right now the bridge to Mercury was looking to be a damned fool thing. First off, it had eaten up the last of the firm's capital. Second, it had left Black Jet reliant on current earnings to meet its cash flow requirements. Maybe Tustin was right. Maybe it was a high price. But it had been necessary. Crucial even. Black Jet needed the Mercury business and the bridge had won it, allowing the smaller upstart to steal the prestigious offering from under the noses of the big guns in New York.

So far, Gavallan had managed to farm out twenty of the fifty million to a few friendly banks- half of what he'd hoped. If the deal went south, Black Jet would be out thirty million dollars. It would be too late for layoffs. He'd be forced to sell his company to the first interested party at a fire-sale price. If the deal went south…