PaineWebber Sues Two Rivals for Alleged ‘Raid’ on Kidder Brokers
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NEW YORK — PaineWebber Group Inc. said Friday that it is suing two rival Wall Street firms for allegedly trying to lure Kidder, Peabody Co.’s top brokers away before PaineWebber acquires the financially troubled company.
In separate lawsuits, PaineWebber charges that Dean Witter Reynolds Inc. and Donaldson, Lufkin & Jenrette offered “exorbitant” financial incentives to Kidder brokers in a corporate “raid.”
PaineWebber said it is seeking a court order to stop both firms from continuing their actions.
DLJ, a unit of Equitable Cos., scoffed at the charges.
“Contrary to what PaineWebber believes, the 13th Amendment abolished involuntary servitude. Kidder brokers have a right to go where they want,” a DLJ spokeswoman said.
She said DLJ did not initiate any contact with Kidder professionals and “only responded to incoming phone calls.”
A Dean Witter spokeswoman said the firm had no comment.
Earlier this month, General Electric Co. said it would sell Kidder, which it bought in 1986, to PaineWebber for shares worth $670 million.
PaineWebber has been eyeing Kidder’s 1,150-strong retail sales force--the most profitable in the business--as a way to expand its brokerage network.
However, DLJ has hired nine Kidder brokers this year.
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