tinyurl.com/ys8gcc -> blogs.wsj.com/deals/2007/12/19/sallie-maes-expletive-good-conference-call/
Good Conference Call Posted by Dana Cimilluca Here's one analyst conference call that won't put you to sleep. New At the beginning of Sallie Mae's telephonic rendezvous with its investors today, CEO Albert Lord (left) mentioned the buyout deal for the company that fell apart last week. "I'm going to attempt to engage in a little self-defense, hopefully not defensively," he said. A conference call that will live in infamy, along with that famous Enron call where Jeff Skilling called an analyst a naughty name, started out innocently enough. "The purpose of this call really is to reacquaint myself with you and you with me and try to create some transparency by me as CEO," Lord, who reassumed that role last week, began. First, he snapped at an analyst for asking a follow-up question: "This is the last question I answer that's more than one part."
Lord demurred, saying the analyst should call Steve McGarry in investor relations. Lord's response: "Yes, that's exactly right, I'm the CEO. Lord then recommended that analysts be prepared to go through a metal detector when they attend the company's analyst meeting in New York in January. There's no questions, let's get the (expletive) out of here." Don't look for that climax in the version of the call Sallie Mae posted on its own Web site.
Too much vertical integration through acquisitions of collection agencies and other related businesses and too much that Mr Lord thought he could do no wrong. The ill considered move to sell the company in the midst of Budget Reconciliation and HEA Reauthorization led to this situation for Sallie. Al just had to cash in and the sale price of Sallie fed fuel to the fire for democrats as they tried to destroy FFELP. Sadly, for the Sallie late coming to the party arbs they got caught as investors. Al is extremely bright and was a gifted financial executive, but ego led to this.
There is no real need for his services in this economy, as the gov't can always make direct loans as they did in the past, and at less direct cost than these student loans companies.
The Federal Direct Loan Program is several times more efficient. Lord should retire to his personal, $30 million golf course, Anne Arundel Manor. Instead, the same hot air that made him pay for legislation stripping standard consumer protections from student loans will ultimately prove his undoing. Boehner's office and Lord's stock dump last spring are just the beginning. Lord, Fitzpatrick, Andrews, BOehner, Buck McKeon, Enzi, Rick Keller -- all will be affected by the widening student loan scandal and backlash.
Moreover, the government does a lousy job collecting on defaulted loans, so credit losses are far higher than at the private lenders. Big surprise-a huge government program does not work very well.
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