Lebenthals seek to sell their family firm

Alexandra Lebenthal, president and CEO of financial-services firm Lebenthal Holdings LLC, is preparing to sell the family business,

the

Wall Street Journal

reported.

The firm faces “unpaid bills and lawsuits,” the

Journal

article noted.

Lebenthal’s grandparents started Lebenthal & Co., which sold municipal bonds to small investors, in 1925. Her father, James, joined in 1963 and “turned the firm into a household name in the New York City area” through memorable advertising, the

Journal

report noted.

In 2001, the family sold the business to a firm that was eventually acquired by Merrill Lynch. Alexandra Lebenthal bought back the rights to her family’s name in 2007 “for the token sum of $1,000,” the

Journal

article said. Lebenthal Holdings consists of a capital-markets unit that underwrites corporate bonds and an asset-management unit.

Alexandra Lebenthal, 53; her brother, James, 48, who runs the asset-management business; and Lebenthal Holdings allegedly owe millions of dollars. The

Journal

report said the firm has been “hurt in part by poor timing and missteps in a short-lived wealth-management business.”

“It isn’t clear whether a deal would be enough to pay creditors fully, but any deal aims to retain the firm’s name and 44 employees,” the article said.

Alexandra Lebenthal received a personal loan of $1 million from James Cayne, then the CEO of Bear Stearns, in March 2008, the

Journal

article said. He has filed a lawsuit against her.

“Even as she struggled to repay Mr. Cayne, the firm was growing and Ms. Lebenthal pressed ahead with plans to expand,” the report said. The firm launched Lebenthal Wealth Advisors LLC, which aimed to attract female advisers, in 2013.

The wealth-advisory unit hired Wall Street veterans, acquired other firms and opened branch offices in places such as North Dakota and Michigan, the article said. In September 2014, Alexandra Lebenthal launched

Sayra

, a quarterly digital magazine “named after her grandmother, who worked in the family’s bond business until she was 93,” the

Journal

reported. The magazine ceased publication last year.

At about the same time, she stopped making payments on her loan from Cayne. He declined her request to convert the debt into a business investment. “He was told his recovery would likely be zero because of the firm’s liabilities,” the

Journal

reported, citing Cayne’s lawsuit.

Lebenthal Holdings’ wealth business closed last summer after several advisers left the firm, the article said.

“Former employees and vendors say the wealth business still owes them money,” the

Journal

report said. The wealth unit is being sued for allegedly defaulting on a lease in Michigan last summer, and Andrew Grillo, who joined Lebenthal from Smith Barney to help lead the wealth unit and left a year ago, is suing the firm and the Lebenthal siblings for about $2 million, the article said.  (Source:

Wall Street Journal

, March 6, 2017.)

Family Business

Magazine featured Alexandra Lebenthal

in an article on family business daughters

in 1994.