The Taipan from Yale

By Daniel Benjamin

In Hong Kong it is known as the princely hong, or trading house, and its leader is the taipan, the big boss. Throughout most of its 156-year history, Jardine Matheson & Co. has been the foremost trader in the colony, and as readers of Novelist James Clavell know, it has been run not so much by a series of executives as by a dynasty of merchant-rulers. Now the succession has taken its strangest turn. Instead of drawing from the small Scottish knot of the founders' families, Jardine Matheson has announced that Brian Powers, 38, a former New York investment banker, will become its first American taipan.

The company that Powers will take over in June is like few others. In an era when most multinational firms have given up their old conglomerating ways, Jardines retains a panoply of seemingly unconnected businesses. With 76,000 employees in 22 countries, the company operates the eighth largest insurance brokerage in the world, a sizable construction firm, an investment bank, and Mandarin Oriental, a leading chain of hotels from San Francisco to Bangkok. Its Hong Kong operations range from the local Mercedes dealership to Mrs. Fields Cookies franchises. But the core of the company's holdings is $3.2 billion worth of real estate in Hong Kong's central business district -- fully 65% of the office and commercial space in the area.

However valuable its assets, Jardines has been surpassed in size by two other Hong Kong trading firms -- Cheung Kong and Swire -- and has only recently begun to escape from a typhoon of troubles. The company bought or built many of its Hong Kong buildings in the early 1980s, just before real estate values in the colony took a dive. The collapse resulted in part from nervousness about the approach of 1997, when sovereignty over Hong Kong will pass from Britain to China. Wary of that transfer's consequences, Jardines decided in 1984 to shift its legal headquarters to Bermuda -- a move that stirred lingering resentment in Hong Kong.

The turbulence of the times may have prompted Jardines to turn to a hyperfast-tracking American as the new taipan. Born in Massapequa, N.Y., Powers graduated from Yale, where he played football, and got a law degree from the University of Virginia in 1974. He began his career with the blue- chip Manhattan law firm of Debevoise & Plimpton, then worked as a money manager for the Ford Foundation and as an investment banker for James D. Wolfensohn Inc. At Wolfensohn, Powers put together several deals for Simon Keswick, the outgoing taipan.

Keswick (pronounced keh-zik), the seventh taipan of that name to run Jardines since its founding in 1832, was impressed, and persuaded Powers to join the company in 1986 as chief strategist. Powers helped engineer a ! restructuring that reduced the firm's debt load and bolstered its earnings. The company's profits surged 64% in 1987, to a record $100.4 million.

Powers has the boldness to keep building Jardines. Says he: "I think you can manage a conglomerate just fine, if you've got it structured just right." And he has absorbed a lot of the 19th century trader's ethos. Regarding future acquisitions, he declares, "We don't care what industry it's in, as long as it's a good buy." To keep its far-flung empire flourishing, Jardines may have picked just the right taipan for the job.

With reporting by Jay Branegan/Hong Kong and Raji Samghabadi/New York