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Published on: 3/26/2007
Last Visited: 3/26/2007
March 26 (Bloomberg) -- On a Thursday evening in September 2003, Pamela Daley, General Electric Co.'s top mergers and acquisitions lawyer, boarded Chief Executive Officer Jeffrey Immelt's custom 737 in pursuit of the company's biggest acquisition.
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Daley shuttled between them with GE's offer and Amersham's responses, knocking on the doors to move things along.
"At some moment, Jeff said, `That's as far as I can go,' and Sir William looked down -- 30 seconds is an eternity in that setting -- looks up and says, `Let's do it,'' Daley recalls.
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Daley, 54, is now chief dealmaker at GE, the second-biggest company in the world by market value, after Exxon Mobil Corp.
She's in charge of every acquisition and sale not related to the company's financial units -- a realm that accounted for more than 60 percent of GE's $163.4 billion in revenue last year.
In addition, Daley, whom Immelt promoted to head of business development in July 2004, sits on the GE board that studies finance-related mergers.
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Daley has been butting heads with some of those firms lately as they go after the same deals.
Immelt, 51, is counting on Daley to deliver acquisitions in areas including health care, water treatment, oil and gas exploration equipment and alternative power generation, like wind turbines.
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Daley has been Immelt's chief strategist in GE's exit from the insurance industry, part of the $35 billion of assets he has shed in slow-growing or volatile industries.
Daley orchestrated the divestiture of Genworth Financial Inc., the life and mortgage insurance unit that GE sold in public offerings totaling more than $11 billion during 2004, '05 and '06.She was the leader of hundreds of meetings about Genworth during almost two years, says Thomas Roberts, a New York-based senior partner with law firm Weil, Gotshal & Manges LLP, which advised GE.
Stagnant Stock
"It's a monumental undertaking of which she was a critical part,'' says Roberts, who met Daley in the late 1990s when she was GE's head M&A lawyer and she suggested the two have dinner at Asia de Cuba, a fusion restaurant in Manhattan.
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In 2005, Daley steered one of Immelt's biggest deals: GE's $7.7 billion sale of its reinsurance unit to Zurich-based Swiss Reinsurance Co.Former CEO Jack Welch pushed GE into insurance in 1983.
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By 1991, Daley, who was first in her class at the University of Pennsylvania's law school in 1979, had landed the job of GE's top M&A lawyer.
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The next day, a slender box arrived from Daley with a bottle of vodka bearing a tag that read, "We bring good things to life,'' GE's advertising slogan at the time.Daley continues that tradition, sending flowers to the spouses of bankers and staff members when a deal takes months of their personal time.When a transaction is completed, she may also send Cristal champagne.
Cultivating a relationship with Daley in Immelt's acquisition-hungry era is a prize for Wall Street investment banks.
`All Roads Lead to Her'
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Porat recalls that Daley worked on the U.K. tender documents, on employment agreements for Amersham executives and on how to handle the announcement to the media, as well as the larger issue of bargaining over price.
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Daley picked up the pace in January with plans for about $15 billion in acquisitions.One indication of GE's deal-making reach: That figure was equivalent to more than half of the total of $24.7 billion in global leveraged buyouts announced during the same month, according to data compiled by Bloomberg.
Daley's team led GE's $1.9 billion agreement to buy oil and gas drilling equipment maker Vetco Gray Inc. from private equity firms including 3i Group Plc.Vetco's 18 percent sales increase last year fits with Immelt's profit goals and his demand that GE deliver a 20 percent return on the capital it invests.
He's also striving for annual sales growth from companies GE has owned at least a year to outpace the rise in global domestic product by two to three times.Last year, Immelt's goal for GE was about 8 percent.This year, it's about the same.
Daley is ditching units that don't measure up.In another January deal, she prepared the proposed sale of GE's 77-year-old plastics unit, where both Immelt and Welch cut their teeth.Higher costs for benzene, a material derived from oil, are making plastics too risky for predictable growth.The unit's profit declined 12 percent in the fourth quarter after GE had forecast a 5 percent rise.
`Hopelessly Modest'
Daley will evaluate the bids and help choose the winner.
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With more buyers and sellers out there, GE uses bankers for intelligence about the market, Daley says.She asks advisers for a two- to three-page summary -- not an opus.
Do You Know GE?
"People are too busy to be taken through a 50-page pitch,'' she says.On an acquisition, she needs to know a target's customers, how it sells to them and how GE can make more money than the business is currently making.
Daley has a rule for any banker seeking a toehold in her universe: Know your strengths -- and know GE.Advisers who want to break into GE Energy, the world's biggest maker of turbines, or GE Healthcare, now home to Amersham, need to do their homework.
"Figure out if you have the best energy bankers,'' Daley says."Visit our energy business.
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Rick Leaman, joint global head of investment banking at Zurich-based UBS AG, worked with Daley on the sale of GE's Advanced Materials unit, the maker of everything from lipstick additives to caulking.
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With Apollo, Daley needed to persuade Bayer AG and Toshiba Corp. to speed the sale of their stakes in Advanced Materials joint ventures so GE could sell the whole unit by December 2006.
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"She was a field general,'' Lee says of Daley.
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Sherin says Daley takes on the most-contentious parts of a deal herself.
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This year, Daley is adopting a second survey.
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"If you're great on energy and lousy in health care, doing something mediocre in health care will get over to the guy at energy,'' Daley says.
Attention, Intensity
Daley gets her own feedback from her boss, Immelt.
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"I have just never seen anybody that could sustain the level of attention and the intensity that Pam can,'' he told GE executives during annual planning sessions in January 2004 in Boca Raton, Florida.
At the dinner for 600, he gave Daley the chairman's award, recognizing her contribution to GE's growth.The prize, which goes to one person a year, included a $25,000 donation to a charity of her choice.Daley selected the Connecticut Audubon Society.
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That's vital, Daley says, because right away she knows the likelihood of getting it done.
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"I'd be hard-pressed to take a brand-new banker or a brand-new firm and recommend them to Jeff on a big deal,'' Daley says.
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For Dyal, it was the first time working directly with Daley.
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Daley grew up in Longmeadow, Massachusetts, near Springfield in the western part of the state.Her father, Edward, built a company that supplied construction materials after World War II.Daley followed in his footsteps in one way: She developed a passion for the New York Yankees in a region obsessed with the archrival Boston Red Sox.Daley describes her mother, Elizabeth, as a bridge player and math whiz.
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Jennifer graduated magna cum laude from Brown University; Pam was a 1974 summa cum laude graduate of Princeton University with a degree in Romance languages.
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Daley married her second husband, Randall Phelps, in August 1995.
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Daley joined the board of the World Wildlife Fund in 2004."She's a great lover of cats,'' says Carter Roberts, the group's CEO, who says Daley is interested in preserving the roaming corridors for endangered tigers and snow leopards.
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Daley has traveled with the board to the Galapagos and will be going to the headwaters of the Amazon River in Peru.
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After Amersham, Daley persuaded Dyal to join the fund.
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Daley, who's 5 feet 9 inches tall, was one of about a dozen professional women who posed for an advertising campaign that Annie Leibovitz photographed.
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"It was a crowning professional achievement,'' jokes Daley, who says she got her break because she knew one of the designers.
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