L.F. Rothschild (later known as L.F. Rothschild, Unterberg, Towbin) was a

merchant A merchant is a person who trades in commodities produced by other people, especially one who trades with foreign countries. Historically, a merchant is anyone who is involved in business or trade. Merchants have operated for as long as indust ...

and

investment bank Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort. In finance, the purpose of investing is ...

ing firm based in the United States and founded in 1899. The firm collapsed following the

1987 stock market crash Black Monday is the name commonly given to the global, sudden, severe, and largely unexpected stock market crash on Monday, October 19, 1987. In Australia and New Zealand, the day is also referred to as ''Black Tuesday'' because of the time z ...

History

L.F. Rothschild & Co. was founded in 1899 by

Louis F. Rothschild Louis Frank Rothschild (September 4, 1869 - June 15, 1957) was an American investment banker and founder of the eponymous investment banking firm L.F. Rothschild. Biography Rothschild was born on September 4, 1869, to Frank and Amanda (Blum) Rot ...

(1869–1957), not related to the European

Rothschild family The Rothschild family ( , ) is a wealthy Ashkenazi Jewish family originally from Frankfurt that rose to prominence with Mayer Amschel Rothschild (1744–1812), a court factor to the German Landgraves of Hesse-Kassel in the Free City of F ...

. Together with partner Leonard Hockstader, Rothschild took up the offices and business of Albert Loeb & Co. at 32 Broadway in New York City, New York. The firm's primary business was sales and trading of fixed income securities. The firm also had an

arbitrage In economics and finance, arbitrage (, ) is the practice of taking advantage of a difference in prices in two or more markets; striking a combination of matching deals to capitalise on the difference, the profit being the difference between the ...

group as well as

retail brokerage A broker is a person or firm who arranges transactions between a buyer and a seller for a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Neither role should be confu ...

and

wealth management Wealth management (WM) or wealth management advisory (WMA) is an investment advisory service that provides financial management and wealth advisory services to a wide array of clients ranging from affluent to high-net-worth (HNW) and ultra-high- ...

operations. Following its merger with C.E. Unterberg, Towbin in 1977, the firm was known as L.F. Rothschild, Unterberg, Towbin and was led primarily by Thomas I. Unterberg and A. Robert Towbin. As of March 26, 1977, it moved to 55 Water Street, leasing the 45th and 46th floors. The firm was known for its merchant banking investments, particularly in high-technology companies. In the early 1980s, the firm emerged as the leading underwriter of

initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...

s, surpassing the elite investment banks (at the time, including

Lehman Brothers Lehman Brothers Holdings Inc. ( ) was an American global financial services firm founded in 1847. Before Bankruptcy of Lehman Brothers, filing for bankruptcy in 2008, Lehman was the fourth-largest investment bank in the United States (behind Gol ...

Goldman Sachs Goldman Sachs () is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered at 200 West Street in Lower Manhattan, with regional headquarters in London, Warsaw, Bangalore, H ...

, and

Morgan Stanley Morgan Stanley is an American multinational investment management and financial services company headquartered at 1585 Broadway in Midtown Manhattan, New York City. With offices in more than 41 countries and more than 75,000 employees, the fir ...

). Among the companies they took public were

Intel Intel Corporation is an American multinational corporation and technology company headquartered in Santa Clara, California. It is the world's largest semiconductor chip manufacturer by revenue, and is one of the developers of the x86 seri ...

Cray Research Cray Inc., a subsidiary of Hewlett Packard Enterprise, is an American supercomputer manufacturer headquartered in Seattle, Washington. It also manufactures systems for data storage and analytics. Several Cray supercomputer systems are listed i ...

, and biotechnology company

Cetus Corporation Cetus Corporation was one of the first biotechnology companies. It was established in Berkeley, California, in 1971, but conducted most of its operations in nearby Emeryville. Before merging with Chiron Corporation in 1991 (now a part of Novarti ...

.MCGEEHAN, PATRICK.
Private Sector; Banker's Novel Late-Career Move
"

New York Times ''The New York Times'' (''the Times'', ''NYT'', or the Gray Lady) is a daily newspaper based in New York City with a worldwide readership reported in 2020 to comprise a declining 840,000 paid print subscribers, and a growing 6 million paid d ...

, November 11, 2001 In 1986, just ten years after merging with L.F. Rothschild, Towbin and Unterberg left the firm to join

Shearson Lehman Shearson was the name of a series of investment banking and retail brokerage firms from 1902 until 1994, named for Edward Shearson

. The firm suffered heavy losses in the

and was acquired by

Kansas Kansas () is a state in the Midwestern United States. Its capital is Topeka, and its largest city is Wichita. Kansas is a landlocked state bordered by Nebraska to the north; Missouri to the east; Oklahoma to the south; and Colorado to the ...

-based Franklin Savings Association in February 1988. However, even with new capital, the firm's holding company, L. F. Rothschild Holdings Inc. filed for

Chapter 11 bankruptcy protection Chapter 11 of the United States Bankruptcy Code (Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, wheth ...

in July 1989. By the end of 1989, the firm had gone from a peak of 2,200 employees to 45.

Notable alumni

Among the notable alumni of L.F. Rothschild are : * Thomas H. Lee, the private equity investor who founded

Thomas H. Lee Partners Thomas H. Lee Partners, L.P. is an American private equity firm based in Boston investing in middle market growth companies across financial technology and services, healthcare and technology & business solutions. History Founded in 1974 by ...

in 1974 * John Angelo and Michael Gordon, who left the firm in 1988 to found

Angelo, Gordon & Company Angelo Gordon is a global alternative investment manager founded in November 1988 by John M. Angelo and Michael L. Gordon who together ran the arbitrage department of L.F. Rothschild in the 1980s. The firm is 100% employee-owned, SEC-registered, ...

. *

Daniel Scotto Daniel Scotto (September 14, 1952- July 10, 2018) was an American financial analyst. In August 2001, as an analyst with BNP Paribas, Scotto downgraded Enron securities from "Buy" to "Neutral". He took this action four months before the Enron acc ...

, former Director of Research, joined the firm in 1982, currently President and CIO of Whitehall Financial Advisors LLC. *

Jordan Belfort Jordan Ross Belfort (; born July 9, 1962) is an American entrepreneur, speaker, author, former stockbroker, and financial criminal. In 1999, he pleaded guilty to fraud and related crimes in connection with stock-market manipulation and running ...

, founder of stock brokerage

Stratton Oakmont Stratton Oakmont, Inc. was a Long Island, New York, "over-the-counter" brokerage house founded in 1989 by Jordan Belfort and Danny Porush. It defrauded many shareholders, leading to the arrest and incarceration of several executives and the c ...

, and subject of the 2013 film '' The Wolf of Wall Street'', convicted of securities fraud, among other felonies. *

Jean Shafiroff Jean Shafiroff is an American philanthropist, author, advocate, and socialite. Serving on multiple national and regional philanthropic boards, she is the ambassador and spokesperson for American Humane Feed the Hungry COVID-19 Program. She is t ...

, philanthropist and socialite * Alan B. Slifka, Investor, philanthropist, co-founder of the Abraham Fund, and founding chairman of the Big Apple Circus

History

Notable alumni

See also

References

Further reading