Gershon Kekst, Founder of Leading M&A PR Firm, Dies at 82

(Bloomberg) -- Gershon Kekst, who founded the dominant public-relations firm for mergers and acquisitions, with clients such as former Citigroup Inc. Chief Executive Officer Sanford Weill and billionaire investor Henry Kravis, has died. He was 82.

He died March 17 in a New York-area hospital, according to a source close to the matter who requested anonymity. No cause was given.

Kekst sold his 38-year-old Kekst & Co. to Publicis Groupe SA, the French advertising company, in July 2008 for an undisclosed amount. One week after the transaction, Kekst described that year’s credit-market contraction as the scariest slump in four decades.

“This is more severe and more intense, and if I had to use one word to characterize it, in contrast to the 80’s, it would probably be frightening,” Kekst said, according to a 2008 Bloomberg News story. “We just don’t know what’s going to happen. The economy is being tested in a bear market that could go for a long time.”

Before its sale, New York-based Kekst & Co. had a role in some of the largest corporate transactions in U.S. history, including representing Kohlberg Kravis Roberts & Co., now KKR & Co., in its successful $30 billion takeover of RJR Nabisco Inc., a role chronicled in the best-selling book “Barbarians at the Gate.”

Citicorp Merger

Other assignments included Chrysler Corp.’s merger with Daimler-Benz AG, Citicorp’s tie-up with Travelers Group Inc., Walt Disney Co.’s deal with Capital Cities/ABC Inc., billionaire Ron Perelman’s purchase of Revlon Inc. and Time Inc.’s combination with Warner Communications Inc.

Kekst, who served as chairman and CEO of his company, also represented McGraw Hill Cos. in its successful defense of American Express Co.’s takeover bid and Martin Marietta Corp. in its fending off of Bendix Corp.

Known as a takeover specialist, Kekst expanded his firm’s services into initial public offerings, such as those of Lucent Technologies Inc. and Toys ‘R’ Us Inc. as well as the bankruptcies of R. H. Macy & Co., Pan American World Airways and Wickes Inc.

“Gershon gets the top brass to listen to him,” said Joseph Flom, the takeover lawyer at Skadden, Arps, Slate, Meagher & Flom in New York. “He’s the first choice of many CEOs.” Flom, an architect of the modern M&A era, died in 2011.

‘Dentist Defense’

Kekst used his brains and common sense famously in his so-called “dentist defense” to thwart a proposed takeover in 1975 of Sterndent, a manufacturer of dental equipment. The proposed acquirer was an investment group led by heirs of a noted Jewish philanthropist and some Arab partners. In a tactic worked out with Flom, Kekst pitched the takeover in newspaper ads as one by Arabs who might make Jewish dentists uncomfortable, according to a 1989 New York Times story. The bid was dropped.

As part of his crisis-management service, Kekst helped secure the 2001 pardon by President Bill Clinton of accused tax evader Marc Rich, who made billions trading commodities, including some allegedly illegal sales to Iran during the 1979 hostage crisis. Rich died in 2013.

“Gershon was one of the most admired advisers for Wall Street firms,” Publicis chairman and CEO Maurice Levy said in an emailed statement. “He pioneered new avenues of PR and created the concept of strategic communication as we know it today.”

Gershon Kekst was born Oct. 12, 1934, in Peabody, Massachusetts, to Lithuanian immigrants. The son of a Hebrew school teacher, he grew up in nearby Salem.

Early Career

He studied psychology at the University of Maryland, where he earned a bachelor’s degree in 1956. Kekst worked briefly as a radio announcer before a short stint for a Washington publicist. In 1959, he moved to New York and joined Ruder & Finn, the PR firm. He rose in the ranks to eventually run West Coast operations before leaving in 1970 to start Kekst & Co., whose initial clients needed help with financial transactions.

Deeply devoted to Jewish causes, he was the board chairman of the Jewish Theological Seminary from 1991 until 2009. The JTS graduate school is named after him. He also served as former chairman of the board of governors at the Weizmann Institute of Science in Israel.

Kekst said he once asked his friend Flom whether Kekst & Co. would be crippled if mergers and acquisitions dried up.

“You’re not in the M&A business, you are in the ‘seykhl’ business,” Flom replied, using a Yiddish word meaning “street smarts.” “Business leadership is going to find issues and problems to get themselves into long after the M&A business is gone.”

Survivors include his wife, Carol, and sons David and Joseph.

To contact the reporter on this story: Patrick Oster in New York at poster@bloomberg.net.

To contact the editors responsible for this story: Caroline Salas Gage at csalas1@bloomberg.net, Steven Gittelson, Mark Schoifet