A Shy Wunderkind, Stephen Feinberg

Eytan Avriel
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Eytan Avriel

Stephen Feinberg, 45, the CEO of Cerberus, which submitted the winning bid for Bank Leumi, is a New York Jew with a golden touch who turned a $10 million fund into a holding company whose properties sell more than $30 billion annually.

How come most of us haven't heard about the financial wunderkind? It's not by chance. Like most hedge-fund managers, according to Business Week at least, Feinberg keeps a low profile. He makes himself scarce around photographers, and sends underlings like Cerberus chair Dan Quayle to sign his deals.

According to a former college roommate who, unlike Feinberg, agreed to be interviewed by Business Week, Feinberg prefers Budweiser to Beaujolais and drives a Ford truck rather than the Ferrari that his $50 million take-home pay would more than cover.

However, players on the American market are familiar with Feinberg.

According to a Business Week profile from October, "Defense Secretary Donald H. Rumsfeld was an investor in 2001, according to government ethics disclosures. Hedge-fund legend Michael Steinhardt is a shareholder and director in Cerberus' lending arm, Ableco LLC. Michael Dell's private-investment firm has joined with Cerberus and home-builder Lennar Corp. to develop upscale residential communities on the former El Toro Marine Corps Air Station in Irvine, Calif. His roster of investors also includes public pension funds such as TIAA-CREF and the California State Teachers' Retirement System."

After paying so much for Leumi - 16 percent more than the bank's share price yesterday and 54 percent above its shareholders equity - Feinberg and his partners at Gabriel will be hard-pressed to squeeze profits sufficient to justify additional increases in the share price. If he does manage to do so, the rest of the country's banks will have their work - introducing efficiency and reaping profits - cut out for them.