Joseph Flom, Class of 1940
Joseph Flom, the last surviving original partner of law firm Skadden, Arps, Slate, Meagher & Flom LLP and an architect of the modern mergers-and-acquisitions business, has died. He was 87. He died Wednesday, February 23, 2011, the New York-based firm said in a news release. The cause was heart failure.
Flom was "a giant in the takeover field, perhaps the single most important force in the game during the 1970s and 1980s," Robert Slater wrote in his 1999 book, "The Titans of Takeover." So feared was he "that arbitragers were eager to know which side Joe Flom was on whenever a takeover was announced," Slater wrote. Some firms even paid him a retainer to make sure he wouldn’t end up challenging them, a practice that became known as the "Joe Flom protection policy."
Flom helped orchestrate Ron Perelman’s 1985 takeover of Revlon and ABC’s sale to Capital Cities. In 2005, he advised May Department Stores Co. in its $11-billion merger with Federated Department Stores Inc. Three years later, Flom advised Anheuser-Busch Cos. when it was bought for $52 billion by the Belgian brewer InBev NV.
"Joe made an indelible impression on the legal profession that will live on forever," Martin Lipton of Wachtell Lipton Rosen & Katz said Wednesday in a statement. "A giant has departed from our midst."
Lipton and Flom together pioneered legal maneuvers in hostile takeovers in the 1980s, the original heyday of modern M&A activity, when a lot of the rules were being developed, said Larry Hamermesh, a Widener University law professor who specializes in Delaware corporate law. Lipton typically worked defense and Flom often worked offense.
"I remember then as having a sense of him as a legendary figure because of his extraordinary prominence in takeover tactics and litigation," said Hamermesh, who met Flom in the late 1980s. "He was certainly at the top of the game back then."
Joseph Harold Flom was born Dec. 21, 1923, in Baltimore, the son of a union organizer and a housewife from Russia, his son Peter L. Flom said this month in a post on the website Daily Kos. He was raised in Brooklyn and attended City College of New York before enlisting in the U.S. Army. Flom never completed his undergraduate studies. He was accepted at Harvard Law School, which he attended under the G.I. Bill, and served as editor of the Law Review before graduating in 1948 and joining Skadden Arps as its first associate. Flom knew from childhood that he wanted to be a lawyer and graduated 23rd in his class, Peter Flom wrote. "But when he got out, he couldn’t get a job at a ‘good’ firm -- they didn’t hire Jews," Peter Flom said. "So he joined a small firm with three partners."
Flom specialized in mergers and proxy contests when few major law firms did, Bruce Wasserstein, one of the pioneering investment bankers in M&A, wrote in his 1998 book "Big Deal."
Flom’s defining moment may have come in 1974 when he helped International Nickel Co. of Canada complete a hostile takeover of Electric Storage Battery, then the world’s largest battery maker. Previously, hostile deals were rare and not a legal specialty. By the 1980s, the practice had become significant for law firms like Skadden Arps and banks such as Goldman Sachs & Co. and Morgan Stanley. The law firm "earned a reputation for being willing to take the gloves off for its clients," Wasserstein wrote.
Survivors include his wife, Judi; two sons, Jason and Peter; and a daughter, Nancy Laing. His first wife, Claire, died in 2007.