First Boston Thrives Despite 2 Departures

To the surprise of some skeptics, First Boston Inc. has not been short of merger and acquisitions business despite the departure earlier this year of superstars Bruce Wasserstein and Joseph Perella.

For one thing, merger activity on Wall Street was booming at the time that Wasserstein and Perella walked out to establish their own firm, analysts say. And secondly, however brilliant the former First Boston executives may be, they worked on only a small percentage of the merger deals.

James Maher, 38, who took over many of Wasserstein’s functions, said the majority of First Boston’s clients prefer the “breadth and depth” of a big investment bank that has full underwriting capabilities as well as strong trading and research units.

“The concept of a one- or two-man band being better than an institution doesn’t make any sense,” Maher, co-head of investment banking at First Boston, said in an interview.

He said independent advisers have a role, but that most clients benefit from the kinds of ideas that grow out of the interaction among members of a diverse team.

Analyst Frank DeSantis of Smith Barney, Harris Upham & Co. said the Wasserstein and Perella team directed most of its efforts to a small number of deals, usually the biggest and most complex.

“I think First Boston has a very talented staff to handle the bread-and-butter business, and that’s what will remain after the merger mania dies down,” DeSantis said.

When Wasserstein and Perella launched their own company in February, they persuaded about 15 of their First Boston colleagues, or 10% of the department, to join them.

Officials with Wasserstein and Perella did not return calls.