Salomon Brothers chief executive Deryck Maughan placed a call to Travelers chairman Sanford Weill and packed his bags for two weeks’ holiday in Hawaii. The call was a bombshell – a suggested merger with Travelers’ huge US brokerage arm Smith Barney.
With a market capitalization of $55 billion, such a combination would dwarf other recent deals like Morgan Stanley-Dean Witter or even banks like Chase Manhattan and Deutsche. In theory, at least, it could change the top tier of the bulge bracket to the “big four”, one of Maughan’s mantras.
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