Corporate Experience Pays Off for AT&T

Q3 earnings for telecommunications giant AT&T Inc rose 41.5%, boosted by the acquisition of BellSouth and new wireless customers. Strong sales of Apple’s iPhone, which has an exclusive service contract with AT&T, also brought in new customers for AT&T ( see Jeffrey Bartash’s article from MarketWatch.com). Since AT&T is one of the most successful, as well oldest and largest, companies in America we decided to create on IntellectSpace Knowledge Map of the Board of Directors in order to “visualize” their corporate experience. We found that AT&T has perhaps one of the most experienced boards in corporate America, if not the world (Note: the information contained and presented in Knowledge Maps is public information from the Securities and Exchange Commission of the United States of America).

Board Connections Give Goldman Sachs the Advantage in New Buyout Strategy

Goldman Sachs is setting big goals for small deals as it has raised $20 billion for its latest buyout fund (see article from Reuters). In order to examine how common connections may give Goldman Sachs the upper hand in its business dealings, we quickly created an IntellectSpace Knowledge Map of the board connections of the private equity giant.

Director Ties Connect Goldman Sachs to Tiffany

Goldman Sachs is expanding its scope to Japan, where it has agreed to purchase Tiffany and Co’s Tokyo store for $318 million (see article from Reuters). We created an IntellectSpace Knowledge Map of the common connections between Goldman and Tiffany’s to try to discover what may have sparked this deal. After exploring the Knowledge Map, we discovered key relationships that may have helped Goldman to land this hot property.

Click here for an interactive version of this IntellectSpace Knowledge Map (Internet Explorer browsers only): http://nv.intellectspace.com/ispace/GuestMonitor.aspx?id=e4e6545e-f1e8-4c33-973b-3f62e7bea757

A first strong tie links Abby F. Kohnstamm (a Tiffany’s Director), to Charles A. Davis (Goldman’s former Head of Investment Banking). Davis was with Goldman for 23 years until 1998, and knows Kohnstamm through Progressive, where they both currently serve as Directors. Given the many years Davis served at Goldman as a senior executive, he likely still has strong ties to the company’s current leadership team, who would have found this relationship particularly advantageous in securing a deal with Tiffany’s.

The Knowledge Map also shows that William A. Shutzer (a Tiffany’s Director) has numerous connections to people at Goldman. Shutzer shares a noteworthy relationship through Fortress Investment Group, where he previously served as Director. Peter L. Brigar Jr, who served as Partner and spent 15 years at Goldman, joined Fortress in 2002 and is now a Director at Fortress. Shutzer must know Brigar through overlapping board memberships at Fortress, which could then be useful for Goldman’s bid for Tiffany’s Tokyo store.

Ties to Goldman Give Apollo the Advantage

The latest trend for private equity firms is to go public. Apollo Management is seeking to bypass the typical time consuming process of making an initial public offering to quickly get shares of its stock to eager buyers. This means fast cash without the wait. Making this alternative method possible is Goldman Sachs, which has opened its GSTrUG markets to Apollo, where a limited number of shares can be sold before the IPO process has been completed, giving Apollo a valuable head start against is competitors  (See the related Financial Times article).

This move by Goldman proves very convenient for Apollo in its latest endeavor. An IntellectSpace Knowledge Map of the two entities reveals that the common connections between the two go as far back as grad school. At least five of Apollo’s senior executives received their MBA’s from Harvard Business School, which also happens to be the institution at which a number of Goldman’s past and current corporate heads received their degrees or even served as members of the faculty. Similar relationships are also present at Yale, Columbia, Stanford, Berkeley, and Duke universities. School ties can remain strong throughout the years, especially between former students and their mentors, which can later turn into professional ties. With as many educational connections as there are between Apollo and Goldman, these school ties could be the ultimate connector for these two financial juggernauts.

Other relationships worth a taking a closer look involve those professionals of both companies who are members of the Council on Foreign Relations. Adam M. Aron, the head of World Leisure Partners, a consulting company that holds Apollo as its primary client, and Joshua Harris, a founding Senior Partner of the private equity giant, are both members of the Council of Foreign Relations along with five past and current members of Goldman’s leadership team. Because of these direct links to the council, we can realistically assume that these individuals have had some degree of association with each other.

In displaying not only business ties, but also non-corporate links to educational institutions and organizations, IntellectSpace’s Knowledge Maps allow another side of the story to be seen. As demonstrated here, when these two seemingly unrelated entities have their common connections mapped, they share numerous ties that create valuable insight into what may be behind Goldman’s willingness to comply with Apollo’s unusual investment tactics.

Click here for an interactive version of this IntellectSpace Knowledge Map:

http://nv.intellectspace.com/ispace/GuestMonitor.aspx?id=92775b5a-1d0b-42b0-8882-df1c9578ac25 (Only available with Internet Explorer browsers)

Goldman Brings Relationship Capital into Alltel Deal

Goldman's far-reaching relationships into Alltel are well depicted in the following Knowledge Map.   

According to the Knowledge Map, the strongest relationship that Goldman Sachs has with Alltel is through Western Wireless.  The Knowledge Map shows that Terence M O'Toole was a board member of Western Wireless as well as a senior executive of Goldman Sachs.  Goldman Sachs was also an investor into Western Wireless and its financial adviser during its 1996 IPO and secondary offerings. John W Stanton, a co-founder and a former board member of Western Wireless assumed a board seat on Alltel after it acquired Western Wireless nearly two years ago. 

Mr. Stanton's deep relationships into Goldman Sachs also include his former board seat at NII Holdings Inc, where he intersected paths with Carolyn Katz, a former Managing Director of Goldman.  Other relationship intersections include Crane, Adic, and Harvard Business School.

An interactive version of the Knowledge Map is available at the following URL: http://nv.intellectspace.com/ispace/GuestMonitor.aspx?id=4bb11446-5525-4018-9de6-a06cbddc629f (Internet Explorer browsers only)

Mapping Goldman’s and Blackstone’s Relationships

Here is an interesting Knowledge Map that shows how inter-connected Goldman Sachs and Blackstone executives truly are.  An even more interesting observation, however, is that most of the common connections between these two entities are former connections.

http://nv.intellectspace.com/ispace/GuestMonitor.aspx?id=ae0e7e8a-cc79-47d7-a7ff-405d93421602

(INTERACTIVE VERSION)

Goldman and Blackstone have even less common board positions, as the following Knowledge Map suggest:

http://nv.intellectspace.com/ispace/GuestMonitor.aspx?id=b13ff193-556b-438a-9c30-ba86ac9f6675(INTERACTIVE VERSION)