BW Online | April 9, 2001 | Is Weill After AmEx?

U.S. EDITION
Full Table of Contents
Cover Story
Up Front
Readers Report
Corrections & Clarifications
Books
Technology & You
Economic Viewpoint
Economic Trends
Business Outlook
News: Analysis & Commentary

In Business This Week
International Business
International Outlook
Marketing
The Corporation
Developments to Watch
Science & Technology
Government
Finance
Media

Social Issues
Information Technology
BusinessWeek Investor
The Barker Portfolio
Inside Wall Street
Figures of the Week
Editorials

INTERNATIONAL EDITIONS
International -- Letter From Belgrade
International -- Spotlight on the Central African Republic
International -- Readers Report
International -- Asian Business
International -- European Business
International -- Latin America
International -- Finance
International -- Int'l Figures of the Week
International -- Editorials

PREMIUM CONTENT MBA Insider

BW MAGAZINE Get Four Free Issues Register Subscribe Customer Service

ONLINE FEATURES Book Reviews BW Video Columnists Interactive Gallery Newsletters Past Covers Philanthropy Podcasts Special Reports BLOGS Auto Beat Bangalore Tigers Blogspotting Brand New Day Byte of the Apple Economics Unbound Eye on Asia Fine On Media Green Biz Hot Property Investing Insights Management IQ NEXT: Innovation NussbaumOnDesign Tech Beat Working Parents TECHNOLOGY J.D. Power Ratings Product Reviews Tech Stats Wildstrom: Tech Maven AUTOS Home Page Auto Reviews Classic Cars Car Care & Safety Hybrids INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads

BW EXTRAS BW Digital BW Mobile BW Online Alerts Dashboard Widgets Podcasts RSS

RSS Feeds

Reprints/ Permissions Conferences Research Services

APRIL 9, 2001

INSIDE WALL STREET

Is Weill After AmEx?

Gene G. Marcial

STORY TOOLS

Printer-Friendly Version

E-Mail This Story

INSIDE WALL STREET

Is Weill After AmEx?

What May Pump Up Stone Energy

Service Corp. Comes Back to Life

It looks as if American Express (AXP ) might be Sandy Weill's last hurrah. Whispers persist that the Citigroup Chairman is determined to acquire AmEx, of which he was president in the early 1980s. Some of his intimates say Weill had expected to end up running AmEx, succeeding Chairman Jim Robinson. Instead, Weill lost out in a power struggle. But he has gone on to bigger and better things. And now that he heads a financial giant with assets of $900 billion and a market value of $230 billion, buying AmEx, with assets of $155 billion and a market cap of $53 billion, seems within reach.

"Weill has had a lot of triumphs, but this will be the glorious prize that had eluded him," says Lewis Rabinowitz of investment firm R.L. Lewis. He thinks talks are going on. At 39, AmEx stock is ripe for the picking, he notes--way below its October high of 63.

But why would Weill bother? For starters, AmEx would be "a great strategic win," says Dan Goldfarb of money-management firm David L. Babson, which owns 2 million shares. Combining 53 million high-spending AmEx card members with Citibank's cardholders would give Citigroup gigantic scale--in addition to the world-famous AmEx name.

Goldfarb figures the AmEx card and travel operations are worth 30 a share, its financial advisory unit 15, and its American Express Bank, about 10. Tom Goggins of John Hancock Financial Industries Fund, which owns 2.1 million AmEx shares, puts AmEx' value higher. On fundamentals alone, he says, it's worth 70 a share.

Citigroup isn't the only one after AmEx: Morgan Stanley Dean Witter and American International Group are also in pursuit, says Goldfarb. A Weill spokeswoman declined comment. AmEx says the company does not comment on rumors.

By Gene G. Marcial

Get BusinessWeek directly on your desktop with our RSS feeds. XML

Add BusinessWeek news to your Web site with our headline feed.

Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video.

To subscribe online to BusinessWeek magazine, please click here.

Learn more, go to the BusinessWeekOnline home page