Credit Suisse First Boston can't keep its staff, it seems, once they've seen Moscow. Less than two years after losing Boris Jordan, who opened the Russian securities market for CSFB and the rest of the world, the firm has parted company with local equities chief Peter Halloran.
Both men left to open their own Moscow-based firms. Jordan's Renaissance Capital, which this summer merged with Russian banking powerhouse MFK, part of Unexim Bank, plays a leading role in Russia's turbulent direct investment scene. Halloran's Pharos (Greek for "lighthouse") Capital Management will concentrate on portfolio investment. But the major difference between the two, the 35-year-old Halloran maintains, is that "I'm not torching the place to set myself up as a competitor".
Jordan took most of CSFB's Moscow staff with him to Renaissance. Halloran, who had been raising money for Jordan in New York since 1993, was meant to go too, but relations soured at the last minute. Halloran's own farewell to the mother ship, by contrast, has been tearfully tender. CSFB European equities boss Robin McDonald described the defector as "a seasoned professional and a major contributor to the business". Halloran expects CSFB to be among the investors in his $200 million start-up war chest.
While Halloran helped maintain CSFB's pre-eminence as a Russia broker, he says he wearied of "placing orders for fund managers who would ask me what to buy, then go out to East Hampton [an upper-class beach resort outside New York] for the weekend". With four years' experience in the Russian market, and two years withstanding Moscow's physical rigours, he is confident that he can do better.
Some with capital at their disposal apparently agree. For those raising eyebrows at his $200 million target, Halloran recalls, "I raised $1.2 billion in January as the minimum bid for Svyazinvest". A 25% stake in this telecommunications consortium was eventually sold for nearly $1.9 billion to a consortium involving Moscow's Unexim Bank, George Soros and western banks.
Halloran expects the Russian stock market to taper off from its torrid 150% growth so far this year. But he thinks another doubling within two years is realistic. If he's right, raising money to manage should be no problem. Craig Mellow