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''Barbarians at the Gate: The Fall of RJR Nabisco'' is a 1989 book about the
leveraged buyout A leveraged buyout (LBO) is one company's acquisition of another company using a significant amount of borrowed money (leverage) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loan ...
(LBO) of RJR Nabisco, written by
investigative journalists Investigative journalism is a form of journalism in which reporters deeply investigate a single topic of interest, such as serious crimes, political corruption, or corporate wrongdoing. An investigative journalist may spend months or years rese ...
Bryan Burrough Bryan Burrough (born August 13, 1961, in Tennessee) is an American author and correspondent for ''Vanity Fair''. He has written six books. Burrough was a reporter for ''The Wall Street Journal'' in Dallas, Texas, between 1983 and 1992. He ha ...
and
John Helyar John Helyar (born 1951) is an American journalist and author. He is a graduate of Boston University. He is married to ''The Wall Street Journal''’s Betsy Morris. Helyar has worked for ''The Wall Street Journal'', Fortune magazine, ESPN.com, E ...
. The book is based upon a series of articles written by the authors for ''
The Wall Street Journal ''The Wall Street Journal'' is an American business-focused, international daily newspaper based in New York City, with international editions also available in Chinese and Japanese. The ''Journal'', along with its Asian editions, is published ...
''. The book was made into a 1993
made-for-TV movie A television film, alternatively known as a television movie, made-for-TV film/movie or TV film/movie, is a feature-length film that is produced and originally distributed by or to a television network, in contrast to theatrical films made for ...
by
HBO Home Box Office (HBO) is an American premium television network, which is the flagship property of namesake parent subsidiary Home Box Office, Inc., itself a unit owned by Warner Bros. Discovery. The overall Home Box Office business unit is ba ...
, also called ''
Barbarians at the Gate ''Barbarians at the Gate: The Fall of RJR Nabisco'' is a 1989 book about the leveraged buyout (LBO) of RJR Nabisco, written by investigative journalism, investigative journalists Bryan Burrough and John Helyar. The book is based upon a series of ...
''. The book centers on
F. Ross Johnson Frederick Ross Johnson, OC (December 13, 1931 – December 29, 2016) was a Canadian businessman, best known as the chief executive officer of RJR Nabisco in the 1980s. Early life and education Born in Winnipeg, Manitoba, on December 13, 1931, ...
, the
CEO A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especially ...
of RJR Nabisco, who planned to buy out the rest of the Nabisco
shareholder A shareholder (in the United States often referred to as stockholder) of a corporation is an individual or legal entity (such as another corporation, a body politic, a trust or partnership) that is registered by the corporation as the legal own ...
s.


Summary

Those opposed to Johnson's bid for the company,
Henry Kravis Henry R. Kravis (born January 6, 1944) is an American businessman, investor, and philanthropist.George R. Roberts, were among the pioneers of the
leveraged buyout A leveraged buyout (LBO) is one company's acquisition of another company using a significant amount of borrowed money (leverage) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loan ...
(LBO). Kravis was the first person Johnson had talked to about doing the LBO and felt betrayed after learning that Johnson wanted to do the deal with another firm,
American Express American Express Company (Amex) is an American multinational corporation specialized in payment card services headquartered at 200 Vesey Street in the Battery Park City neighborhood of Lower Manhattan in New York City. The company was found ...
's former
Shearson Lehman Hutton Shearson was the name of a series of investment banking and retail brokerage firms from 1902 until 1994, named for Edward ShearsonTed Forstmann Theodore Joseph Forstmann (February 13, 1940 – November 20, 2011) was one of the founding partners of Forstmann Little & Company, a private equity firm, and chairman and CEO of IMG, a global sports and media company. A billionaire, Forstmann ...
and his
Forstmann Little Forstmann, Little & Company was a private equity firm, specializing in leveraged buyouts (LBOs). At its peak in the late 1990s, Forstmann Little was among the largest private equity firms globally. Ultimately, the firm would suffer from the burs ...
buyout firm also played a prominent role. After Kravis and Johnson are unable to reconcile their differences, a bidding war took place which Johnson would eventually lose. The unfortunate side effect of the augmented buyout price to the shareholders was the creation of a worrying level of
debt Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase. The ...
for the company. The title of the book comes from a statement by Forstmann, in which he called Kravis' money "phoney
junk bond In finance, a high-yield bond (non-investment-grade bond, speculative-grade bond, or junk bond) is a bond that is rated below investment grade by credit rating agencies. These bonds have a higher risk of default or other adverse credit events, ...
crap" and declares him and his cousin as "real people with real money," also stating that to stop raiders like Kravis: "We need to push the barbarians back from the city gates."


Important personalities

*
F. Ross Johnson Frederick Ross Johnson, OC (December 13, 1931 – December 29, 2016) was a Canadian businessman, best known as the chief executive officer of RJR Nabisco in the 1980s. Early life and education Born in Winnipeg, Manitoba, on December 13, 1931, ...
, president and CEO, RJR Nabisco * Ed Horrigan, president and chief executive officer of R.J. Reynolds Tobacco division of RJR Nabisco * Edward J. Robinson, chief financial officer of RJR Nabisco *
Peter Cohen Peter may refer to: People * List of people named Peter, a list of people and fictional characters with the given name * Peter (given name) ** Saint Peter (died 60s), apostle of Jesus, leader of the early Christian Church * Peter (surname), a sur ...
, chairman and chief executive,
Shearson Lehman Hutton Shearson was the name of a series of investment banking and retail brokerage firms from 1902 until 1994, named for Edward ShearsonTed Forstmann Theodore Joseph Forstmann (February 13, 1940 – November 20, 2011) was one of the founding partners of Forstmann Little & Company, a private equity firm, and chairman and CEO of IMG, a global sports and media company. A billionaire, Forstmann ...
, senior partner,
Forstmann Little & Company Forstmann, Little & Company was a private equity firm, specializing in leveraged buyouts (LBOs). At its peak in the late 1990s, Forstmann Little was among the largest private equity firms globally. Ultimately, the firm would suffer from the burs ...
* John Greeniaus, president and chief executive officer of Nabisco division of RJR Nabisco *
Eugene Yetman Eugene may refer to: People and fictional characters * Eugene (given name), including a list of people and fictional characters with the given name * Eugene (actress) (born 1981), Kim Yoo-jin, South Korean actress and former member of the sin ...
, chairman of the board, RJR Nabisco *
Henry Kravis Henry R. Kravis (born January 6, 1944) is an American businessman, investor, and philanthropist.Kohlberg Kravis Roberts & Co. * George R. Roberts, senior partner, Kohlberg Kravis Roberts & Co. * Jim Robinson, chairman and chief executive,
American Express American Express Company (Amex) is an American multinational corporation specialized in payment card services headquartered at 200 Vesey Street in the Battery Park City neighborhood of Lower Manhattan in New York City. The company was found ...
*
Ted Ammon Robert Theodore Ammon (August 30, 1949 – October 20, 2001) was an American financier and investment banker. Born in Pittsburgh, Pennsylvania, he was murdered in his home in 2001 by electrician Daniel Pelosi, who was convicted in 2004. Ammon and ...
, financier and investment banker * Charles Hugel, special committee director


Film adaptation

The book was adapted by
Larry Gelbart Larry Simon Gelbart (February 25, 1928 – September 11, 2009) was an American television writer, playwright, screenwriter, director and author, most famous as a creator and producer of the television series ''M*A*S*H'', and as co-writer of the B ...
for a 1993 television movie of the same name directed by
Glenn Jordan Glenn Jordan (born April 5, 1936) is a retired American television director and producer. Born in San Antonio, Texas, Jordan directed multiple episodes of ''Family'' and helmed numerous television movies, several based on real persons as divers ...
.


Publishing information and reception

In 2008,
HarperCollins HarperCollins Publishers LLC is one of the Big Five English-language publishing companies, alongside Penguin Random House, Simon & Schuster, Hachette, and Macmillan. The company is headquartered in New York City and is a subsidiary of News Cor ...
re-released ''Barbarians'' to mark the two-decade anniversary of the RJR deal. Media columnist Jon Friedman at
MarketWatch MarketWatch is a website that provides financial information, business news, analysis, and stock market data. Along with ''The Wall Street Journal'' and ''Barron's'', it is a subsidiary of Dow Jones & Company, a property of News Corp. Histor ...
opined on the occasion that it was "the best business book ever." Friedman spoke with the authors about the two-decade history of the book and of their ensuing careers (the two undertook no further joint projects)."'Barbarians at the Gate' authors reflect"
by Jon Friedman, ''MarketWatch'', 11-21-08. Retrieved 12-8-22. Business reporter
Andrew Ross Sorkin Andrew Ross Sorkin (born February 19, 1977) is an American journalist and author. He is a financial columnist for ''The New York Times'' and a co-anchor of CNBC's ''Squawk Box.'' He is also the founder and editor of DealBook, a financial news s ...
of ''The New York Times'' wrote in his book ''
Too Big to Fail "Too big to fail" (TBTF) and "too big to jail" is a theory in banking and finance that asserts that certain corporations, particularly financial institutions, are so large and so interconnected that their failure would be disastrous to the great ...
'' that this is his favourite business book of all time.


References

*Hamilton, David P., Book Review, ''
Washington Monthly ''Washington Monthly'' is a bimonthly, nonprofit magazine of United States politics and government that is based in Washington, D.C. The magazine is known for its annual ranking of American colleges and universities, which serves as an alternat ...
,'' January 1990 {{Kohlberg Kravis Roberts 1990 non-fiction books Books about companies Mergers and acquisitions Kohlberg Kravis Roberts Business books Finance books R. J. Reynolds Tobacco Company Drexel Burnham Lambert Harper & Row books Non-fiction books adapted into films