William Weld Eyes NY Governor Seat –

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,” said firm Co-founder Jeffrey Leeds. “Although he’ll still be contributing to all aspects of our business, it will not be on a fulltime basis while he’s pursuing the governor’s office.”

Leeds insisted that Weld is still in the “exploration” stages of a possible candidacy, but acknowledged that such talk may already be a distinction without a difference. If Weld does end up running, he’ll first have to take on Paychex Inc. Founder Tom Golisano in a GOP primary, before the main event against current New York AG and Wall Street scourge Elliot Spitzer. Early poll numbers from Rasmussen Reports have Weld significantly behind both men, with 68% of New York voters holding either a favorable (35%) or unfavorable (33%) opinion.

Such widespread familiarity is a bit surprising, given that Weld-a Long Island native-has spent most of his adult life in Massachusetts. He was educated at Harvard, 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 Helmes, 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 told Buyouts at the time. “We came from different avenues, though. Mine was political, as I found myself reading polls showing that parents didn’t trust the monopoly model in education as much as they used to.”

Weld also acknowledged speculation that the move was a carefully-orchestrated pit stop on his way to Albany, saying that any such move would have to wait at least six years due to residency restrictions. That waiting period, of course, will have expired by November 2006.

This past April, Weld made his first public acknowledgement that he was considering a run, assuming that Gov. 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. Without going into a disquisition on the press, 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. Not that anyone is asking, but neither is Jeffrey. Be assured that should either Bill’s (or Jeffrey’s) plans change, you will hear it from us.

Leeds says that the letter was entirely accurate at the time, and emphasized the “never say never” disclaimer. He adds that the firm’s top responsibility is to make money for limited partners, and that it recently has staffed up enough to handle the loss of both Weld and Jonathan Newcomb, the former Simon & Schuster CEO who left Leeds Weld last October after less than three years as a principal. Final decisions on the status of Weld’s current 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.