People in the Weld Plans Gubernatorial Run

William Weld is reducing his role with private equity firm Leeds Weld & Co. so that he can focus on a likely run for governor of New York.

“We recently conveyed to our limited partners that, as of Labor Day, Bill will become a senior advisor to the firm instead of a principal,” says firm co-founder Jeffrey Leeds. “Although he’ll still be contributing to all aspects of our business, it will not be on a full-time basis while he’s pursuing the governor’s office.”

Leeds insisted that Weld is still in the “exploration” stages of a possible candidacy. If Weld does run as expected, he’ll have to take on Paychex Inc. founder Tom Golisano in a GOP primary, before the main gubernatorial election against current New York Attorney General and Wall Street scourge Elliot Spitzer. Early poll numbers from Rasmussen Reports have Weld significantly behind both men.

Weld – a Long Island native – has spent most of his adult life in Massachusetts. He was educated at Harvard University, eventually became a U.S. Attorney for Massachusetts under President Reagan, served as Governor of Massachusetts from 1990 to 1997 and ran unsuccessfully for U.S. Senate against John Kerry.

He also was nominated by President Clinton to serve as Ambassador to Mexico, only to have his appointment blocked by Sen. Jesse Helms, due primarily to Weld’s affirmative stand on many gay rights issues.

Weld eventually returned to private life as a New York-based partner with law firm McDermott, Will & Emery, but also took a seat on the advisory board of Leeds Equity Partners, a New York-based private equity firm focused on education-related investment opportunities. He formally joined the firm as a principal on Jan. 1, 2001, at which point it was renamed Leeds Weld & Co.

“Jeff and I first met through a cousin of mine in New York, but what really brought us together was that we had come to the same view of the importance of private equity investment in education,” Weld said at the time.

In April, Weld acknowledged publicly for the first time that he was considering a run for statewide office, assuming that Gov. George Pataki opted not to seek reelection. Around the same time, however, Leeds Weld sent investors a letter that read as follows:

“You may have seen reports in the press suggesting that Bill Weld is considering running for governor of New York. … suffice it to say that Bill is full-time engaged in the business of Leeds Weld & Co. While it has always been Bill’s practice never to say never,’ Bill is not running for governor of New York or for any other office. … Be assured that should either Bill’s (or Jeffrey’s) plans change, you will hear it from us.”

Leeds says that the letter was accurate at the time, and emphasized the “never say never” disclaimer. He adds that the firm’s top responsibility is to make money for LPs, and that it recently has staffed up enough to handle the loss of Weld and Jonathan Newcomb, the former Simon & Schuster CEO who left Leeds Weld in October 2004 after less than three years as a principal. The decisions about Weld’s board seats have not yet been made, but it’s expected that they will be transferred to other firm professionals.

Leeds Weld currently is investing out its $450 million fourth fund, which was the first one raised with Weld on board. Limited partners include the California State Public Employees’ Retirement System, the New Hampshire Retirement System, the Pennsylvania State Employees’ Retirement System, Allianz Private Equity, General Electric and the J. Paul Getty Trust.