After a letter from New York Attorney General Andrew Cuomo yesterday revealed that Bank of America CEO Ken Lewis may have been cowed into completing a merger with Merrill Lynch on threats from former Treasury Secretary Hank Paulson, we knew it was time to check in with one of Lewis´ most fiery shareholders, Evelyn Y. Davis. The D.C. scion misses no meetings and takes no prisoners. And as other shareholders´ fury mounted over Lewis apparent failure to disclose the true wretched state of Merrill´s books, we wondered what Davis had to say about the debacle.
"I´m supporting Ken Lewis," she said firmly. "I have been a long-term shareholder. I have been through all those countless mergers, you know with Citizens & Southern and Barnett Bank and First National Bank of Boston, I have been through all those mergers, and we have had problems with all the mergers but eventually they would work out."
So one of BofA´s most venerated individual investors has kept the faith; how intriguing. And as for Paulson´s threats, she knew where to put them:
"I knew Hank Paulson at Goldman Sachs; he was great," she said. "And then you remember he was sort of hesitating to take the job of Treasury Secretary, so I called him and I said `Hank you owe it to the country to take this job.´ I´m very sorry that he did. He has been a disaster in Washington."
Though she supports Lewis, Davis said she wasn´t fooled by former Merrill CEO John Thain. While Thain was the CEO of the New York Stock Exchange, Davis said she quibbled with him after he tried to squelch a routine resolution she´d proposed as a shareholder. He also promised her a chance to ring the NYSE bell at the end of the day, but failed to deliver. "He double-crossed me," she said.
But as Merrill´s CEO, Thain did something even more curious. Davis said a surprise awaited her when she arrived to the final Merrill shareholder´s meeting, the one in which the shareholders were to vote on Merrill´s merger with BofA.
"At the meeting, John greeted me; he had my ballot in his hands. He said `you´re going to sign now.´ He made me sign immediately. He wanted to make sure that I was voting my 800 shares. I told him I was going to support the merger, but he somehow didn´t believe me, or needed it in writing."
It was her indication, she said, that something might be wrong. "John-I told Ken all along-I said `I don´t think John is telling you everything.´"