Cantor: Beltway big shot to Wall Street titan?

Eric Cantor is trying to pull off an audacious reinvention: morphing from Washington powerbroker to Wall Street rainmaker, all while keeping his political influence alive.

The Virginia Republican rose to prominence in Washington cutting deals between warring political factions, raising millions of dollars for Republicans and running the raucous House floor.

Now he’ll try to find out what — if anything — that means on Wall Street.

There is no guarantee he is worth the millions Wall Street bank Moelis & Co. is shelling out for him — even the people close to him concede he has a steep learning curve. And it’s not clear whether he’ll be able to achieve the triumphant return to the political fray he so clearly desires, sources in New York and Washington say.

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One thing is certain: Cantor’s multimillion dollar contract will make him more fabulously wealthy. The compensation package includes perks such as reimbursement for the “reasonable cost” of an apartment in New York for a year, and a “hotel equivalent rate” after that.

But the rest of his post-congressional life is not yet clear. His political operation is still undergoing a private remaking, and sources close to Cantor say he has a lot to learn when it comes to investment banking.

It’s not a foreign world to him. The financial services industry has long been one of Cantor’s chief interests – to the point that his GOP opponent tagged him as beholden to business during the primary. Cantor’s tight-knit orbit says he is excited to “learn a new business,” as one put it, and leverage the international finance relationships that he fostered while in Congress to help make his company — and others — money.

Cantor was immediately a hot commodity in the private sector after his primary loss in June. The seven-term former congressman met and had conversations with numerous senior executives, lobbyists and headhunters as he considered his future. He also spoke to many big banks – including J.P. Morgan Chase – but the discussions were casual and not about specific positions.

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In private conversations during his job search, Cantor made clear he was not interested in lobbying, or serving as a high-paid trophy for some corporation.

As Cantor considered his options, it was clear to many people he spoke to that Moelis was the favorite — and it would be tough for anyone to catch up. Cantor was drawn to the firm because he knew its head, Ken Moelis, and got along well with him. The boutique firm was also attractive to Cantor because it offers him an opportunity to be more entrepreneurial and not just a figure head in a bureaucratic corporate environment, according to sources familiar with Cantor’s thinking.

At Moelis, Cantor will be a vice chairman and managing director. He will have a steep learning curve given he has never worked on Wall Street or counseled companies on business decisions.

Unlike political horse trading, Wall Street deals are measured in precise dollar terms to the hundredth of a penny per share. Cantor will have to navigate leverage ratios and projected earnings and learn the world of swashbuckling activist shareholders. Wall Street culture is similar to Washington culture in the bruising winner-take-all attitude but the mechanics and language are entirely different.

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Politically, Moelis is a good fit for Cantor because it mostly steers clear of the kind of high-stakes trading that are subject to heavy federal regulation and potential political criticism in some quarters. A senior executive at a rival bank said she thought it was a smart move by the boutique firm to add a well-known Washington figure to assist on deals that could face regulatory challenges or other political headwinds.

“He adds another dimension to a small firm, which can be useful in pitches to companies in highly regulated industries or on controversial deals,” a banker said. Another banker had a somewhat different view, noting that Cantor’s contacts are mainly with Republicans and that big merger deals tend to run afoul of the administration and congressional Democrats. “There is not much in his background that suggests he can shift from being a partisan,” the executive said. “And calling up his Republican buddies in the House is not going add a lot of value.”

Though the possibility of a political future seems unlikely now, Cantor still wants to leave open the possibility of running for office. He has said as much to players in New York and Washington. Cantor will be responsible for opening an office in Washington for the firm and Moelis is also hiring Kristi Way, his longtime Richmond-based chief of staff.

“It’s no secret Eric wants to leave that door open, but that’s not his focus now,” said one former senior Cantor aide....