At Merrill Lynch, there was no doubt about it: Edson Mitchell was a star. Largely under his direction, the investment bank's fixed-income division leapt from nowhere in the 1980s to become the number one global player. Using swaps and derivatives talent hired from JP Morgan and Morgan Stanley, Merrill surprised its competitors by becoming one of the most creative and innovative players on Wall Street. By 1995, the charismatic Mitchell was said to be in command of a $1 billion revenue stream - the driving force behind Merrill's international expansion in recent years.
But last January, Merrill embarked on a strategic reorganization, and the future of Mitchell's star status seemed to be thrown into question. He was asked to head equities, a move his superiors said was designed to broaden his management capabilities. But outsiders interpreted the reassignment as a way of breaking down Mitchell's power base, as part of an attempt to rid Merrill of the fiefdoms they say had plagued it for years. After weeks of negotiations, Mitchell turned down the new assignment and defected in May to Deutsche Morgan Grenfell in London.