Former Tyco CEO Dennis Kozlowski has settled back into the corporate world after serving over six years in the New York State prison system. In 2005 Kozlowski was convicted of crimes relating to reported unauthorized compensation of more than $81 million as chronicled in “Taking Down the Lion” by Professor Catherine S. Neal, who also questioned the government's legal tactics in the case. Kozlowski’s lavish lifestyle and spending was widely reported and criticized as a sign of corporate greed.
In a Q&A with FOXBusiness.com he talks about his next chapter which is focused on M&A, politics and helping former offenders get back on their feet.
As chairman of The Fortune Society, a non-profit that helps ex-prisoners, what advice do you plan to give individuals starting over and what do you wish someone had told you?
“How difficult the adjustment to the outside world would be. It took me some time. I had the support of family and friends. I quickly recognized I was in the minority. Fortune, which I became involved with when I was away, becomes their [prisoners’] sole support group.” The mission of the Fortune Society, as described by Kozlowski, is to help former offenders with housing, job training and placement, as well as advocacy and general support. The organization has served over 5,500 men and women in the New York area.
You returned to society after six-and-a-half years in a NY state prison prison. You now run a mergers & acquisitions consulting practice – what was the biggest challenge for you transitioning back to the corporate world?
“How fast information moves with technology. What used to take weeks and a staff can now be done on an iPhone. The iPhone didn’t exist when I was away and you don’t have access to technology [in prison].” Kozlowski’s iPhone is about three years old and he plans to upgrade soon. He also tells FOXBusiness.com he has no interest in working for a large M&A advisory firm, instead preferring to work with smaller, more nimble companies.
In 2015, M&A volume surpassed a record $5 trillion, led by mega deals [$50+ billion] in health care and technology. What is your outlook for 2016?
“With depressed stock prices and slow growth, the ingredients are there for more M&A this year. My clients are primarily health care and tech and they are active or interested in mergers. As you go up the pyramid there are fewer companies of size. So I am not certain you’ll see the same mega deals we saw in 2015, but smaller companies are eager.”
Pfizer/Allergan’s $160 billion deal, the largest pharmaceutical deal ever, will move the company to Dublin, Ireland which offers a lower corporate tax rate of 12-13% vs. the United States’ 40%. These so-called tax inversions are being excoriated on the campaign trail. What are your thoughts?
“For companies to be called out for trying to reduce costs is simply wrong. Inversions have the beneficial effect of helping employees, customers and investors. It’s difficult to compete against a company with a significantly lower tax rate and therefore adding another reason why inversions are critical. That at times is what’s not understood by some in Washington.” Earlier this year, Johnson Controls (NYSE:JCI) announced plans to purchase Tyco International (NYSE:TYC), based in Ireland, for $16.5B. Kozlowski declined to comment on the deal.
Donald Trump and Bernie Sanders won the New Hampshire primary. With the presidential election season in full swing we asked him which presidential candidate he is supporting. He declined to comment but hopes that individual is more friendly to business.
“I would hope the next president is a supporter of business. That is something that has been sorely lacking in the last eight years.“