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Mogul Mediator

Allen & Co.’s Peretsman gets in the middle of media deals.

A REGULAR ON FORBES AND FORTUNE MAGAZINES’ lists of the most powerful women in business, Nancy Peretsman, managing director of Allen & Co., speaks with an intensity that makes even the most hardened chief executive sit up and listen. “Years ago one of my clients said to me, ‘If you weren’t my banker, you’d be a dictator of a Latin American country or you’d be a mother.’ I said, ‘Well, I am a mother. But I’ve always been a little bossy.’”

Call her maternal, call her jefe — just call her. That’s the attitude of an impressive list of top CEOs who have turned to this media banker. Last year Peretsman helped News Corp. chairman and CEO Rupert Murdoch devise his strategy for acquiring Dow Jones & Co. She was well equipped to do so, having advised Elisabeth Goth, a member of the Bancroft family that controlled Dow Jones, on her attempt to persuade the board to sell market data provider Telerate a decade earlier. It wasn’t the first time her clients have overlapped. She is currently advising Barry Diller, chairman and CEO of IAC/InterActiveCorp, in his fight over control of the company with John Malone, chairman of Liberty Media Corp. and, like Diller, a longtime client of Peretsman and Allen & Co. Peretsman says Malone is happy she is involved in the deal because having worked with both sides before makes her a better mediator. A Liberty Media spokesman did not return a call for comment.

Peretsman had planned to go to law school, but a summer job at Allen & Co. persuaded her otherwise. She started her investment banking career at Blyth, Eastman Dillon & Co. in 1979, then went to Salomon Brothers in 1982 before rejoining Allen & Co. in 1995.

Notwithstanding her larger-than-life clients, Peretsman takes pride in coming up with creative solutions for lower-profile situations. One such example is the advice she gave Weyerhaeuser, the Seattle-based paper manufacturer, on structuring the $3.3 billion sale of its fine-paper business to Montreal-based Domtar as a reverse merger, with Domtar management running the new entity but Weyerhauser shareholders owning a majority of the business. The deal allowed Weyerhaeuser to reduce its number of outstanding shares by giving shareholders the option of exchanging their Weyerhaeuser stock for shares in the new Domtar.

Steven Rogel, Weyerhaeuser’s chairman who also served as CEO at the time, says Peretsman helped the company conclude that the business should be sold. More important, though, he adds, “when it came to how to best position that transaction for the benefit of the shareholders of our company, that’s where Nancy’s expertise really shone through.”

Since the acquisition was announced on August 23, 2006, Weyerhaeuser’s shares are up 11.3 percent. Standard & Poor’s Global Timber & Forestry index returned 11 percent over the same period.

Peretsman says Morgan Stanley, which also advised Weyerhaeuser, “fought tooth and nail” against her share exchange idea before finally relenting. She jokes that her marriage to Robert Scully, a high-ranking Morgan Stanley executive who advises sovereign investors, may have helped bridge differences. Stephen Munger, the Morgan Stanley banker who worked on the deal, declined to comment.

Peretsman also played a key role in another reverse merger, between Activision and the electronic-games subsidiary of Vivendi (see article in the March 2008 Institutional Investor). Although Activision holders ended up with a minority position in the merged entity, she helped ensure that the deal included strong protections for her client, such as a Vivendi commitment to buy back Activision shares even after the deal closed, to support the price. Activision chairman and CEO Robert Kotick praises both Peretsman and Allen & Co. president Herb Allen III. “They give thoughtful long-term advice that’s in the best interest of the company, without worrying about the short-term fee,” he says.

For Peretsman such an individual approach to clients is the key to her success and that of her firm. “We don’t do a book, announce in The Wall Street Journal it’s for sale and take incoming calls,” she says. “It’s not our thing.”