Christopher Flowers last made headlines on Wall Street in October, when Refco, the US futures brokerage, collapsed into bankruptcy, and turned to him to rescue part of the business with a bid.
Mr Flowers, known for his golden touch with financial services investments, was quick to answer the call. He assembled a consortium of investors, many of them former colleagues from Goldman Sachs, and made an early offer for the stricken unit.
A bankruptcy judge’s ruling eventually caused the deal to unravel: Mr Flowers was unwilling to accept a reduction in the transaction’s “break-up fee”, and the UK’s Man Financial ended up owning Refco after an auction. But in Wall Street’s consciousness, Mr Flowers had re-emerged from the shadows.
In truth, Mr Flowers had been as busy as ever even before Refco imploded. On the deals front, he was scouring Europe – particularly Germany – for troubled state-owned banks sitting on piles of bad debts, as well as other assets such as NIB, the Dutch commercial bank he bought with a consortium of investors. He had also been eyeing Fox-Pitt Kelton, the boutique stockbroker specialising in financial services that recently completed a management buy-out from Swiss Re, the insurance giant.
At the same time, Mr Flowers was laying the groundwork for the next big bet of his career: a large private equity fund worth billions of dollars, into which he is injecting some $200m of his own wealth.
Over his more than twenty-year long career on Wall Street, Mr Flowers has rarely taken a wrong step. At Goldman, where he presided over the financial institutions group, advising on large mergers such as Nations Bank’s union with Bank of America and Wells Fargo’s combination with Norwest, he was one of the youngest bankers ever to be made partner.
After leaving Goldman in 2000 to try his own luck, Mr Flowers participated in one of the most lucrative deals in the history of private equity. He teamed up with Tim Collins, the chief executive of Ripplewood Holdings, to engineer the buy-out of Long Term Credit Bank, one of Japan’s largest banks that was later renamed Shinsei Bank. The buyers eventually made about 12 times their money on the deal.
Through his new fund, Mr Flowers, who grew up in Boston and attended Harvard University, will have a platform from which to prove his ability to perform similar magic with other companies.
Get alerts on Financial services when a new story is published