THE YEAR WAS 1975, AND JAMES (JIMMY) LEE JR. wanted to go to the party. He and his senior-year track teammates had always missed Winter Carnival, the annual intercollegiate soirée at Williams College in Massachusetts, to compete in their championship meet in Maine. Lee, now vice chairman of JPMorgan Chase & Co., was a sprinter and middle-distance runner; for five years he shared the New England Small College Athletic Conference record in the one-mile relay. Coach Richard Farley agreed to let the Williams economics and art history major skip the meet — as long as he told the squad he was attending Winter Carnival. “We both kind of laughed about it, because that was the end of the conversation,” Farley remembers.
Ever the competitor and team player, Lee, 59, is the dean of U.S. rainmakers. His recent deals include News Corp.’s $5.6 billion buyout of Dow Jones & Co. in 2007, United Air Lines’ $6.5 billion merger with Continental Airlines in 2010 and General Motors Co.’s $23 billion initial public offering that year. In 2011 he served as lead banker for NBC Universal in its $30 billion sale to Comcast Corp. and advised insurer American International Group on its $8.9 billion stock offering. Lee also secured JPMorgan Chase’s underwriting position in Facebook’s upcoming IPO.
Last year JPMorgan Chase jumped to No. 2 in global deal volume, with $525 billion, up 22 percent from 2010, when it ranked in fourth place, according to Dealogic. Chairman and CEO Jamie Dimon gives three main reasons for Lee’s success. “No. 1, he’s always extremely prepared,” says Dimon, who has pitched M&A deals with the Connecticut native. “No. 2, he makes sure the full force of JPMorgan is behind him. . . . No. 3, he recommends what is best for the client.”
Former General Electric Co. CEO Jack Welch can attest to that. During the recession many companies owned by private equity firms had trouble borrowing from their revolving credit facilities. “Jimmy Lee fought hard that we could be sure to get these lines of credit in a clutch,” says Welch, now a senior adviser at New York–based private equity shop Clayton, Dubilier & Rice.
Lee’s first job out of college was as a management trainee at Chemical Bank, which became Chase Manhattan Bank before merging with J.P. Morgan & Co. in 2000. During his career with the institution, he’s built its syndicated loan, private equity, high-yield bond and public debt franchises from scratch. Save for two years in the early 1980s founding Chemical’s Australian merchant bank, Lee has always worked in Manhattan. In 1994 he launched Chase’s M&A business. “The way we practice M&A here is that we start with a view of a long-term relationship,” says Lee, who became vice chairman in 2001 and is also co-chairman of J.P. Morgan, his firm’s investment bank. “That’s very important to us and in our nature — long, deep, multilevel, multi-touch-point relationships.”
Take the United-Continental deal. Lee has worked with United’s executives for more than 20 years and with Continental’s since 1993. Starting in 2006 he represented United in the painful three-year courtship that preceded the merger. In April 2008, after both sides had hammered out a deal, Continental’s board called it off, questioning the economies of scale with another highly leveraged airline amid an economic downturn and volatile oil markets.
The next day Glenn Tilton, then CEO of United, phoned Continental CEO Lawrence Kellner. “Glenn, to his credit, said, ‘Hey, I’m not happy, but I still think this is the right deal to do, so why don’t we form an alliance?’ ” recalls Lee. With Lee’s advice, Tilton got into advanced talks with US Airways Group. But after Kellner stepped down in 2009, Continental’s board blessed the United tie-up.
Early last decade Lee held his own late-stage negotiations about becoming the No. 2 executive at New York–based private equity giant Blackstone Group. But these days he has no plans to leave JPMorgan Chase. “Working here is like playing for the New York Yankees,” Lee says. “I work for the greatest CEO in the land, and all my teammates are all-stars.” • •
