March 30, 2009 / 6:53 PM / 11 years ago

Buffett's favorite banker to leave Goldman Sachs

NEW YORK (Reuters) - Goldman Sachs investment banker Byron Trott, the rare Wall Street dealmaker who gained the trust of billionaire investor Warren Buffett, is leaving to start his own merchant banking firm, a person familiar with the situation said on Monday.

Trott, a vice chairman in Goldman’s investment banking division and head of its Chicago office, intends to raise a merchant banking fund that could swell to $2 billion. The Chicago-based business will be named BDT Capital Partners, the source said.

Goldman declined to comment.

Trott, 50, will focus on family owned and entrepreneurial companies, investing capital and providing advice.

Trott gained fame playing the coveted role of serving as adviser to Berkshire Hathaway, helping the acquisitive Buffett through a series of deals. On more than once occasion, Buffett praised Trott in his letters and meetings with Berkshire shareholders.

Among other deals, Trott last year convinced Buffett to help finance Mars Inc’s $23 billion takeover of Wm. Wrigley & Co, invest $3 billion in General Electric Co and buy $5 billion of Goldman Sachs preferred stock during last autumn’s financial panic.

Trott’s departure comes as a parade of bankers leave big Wall Street firms to join boutique firms or companies that are not subject to compensation limits set by the U.S. government. Big banks have also shed thousands of jobs in the past year as the prolonged credit crisis puts the brakes on deal activity.

Goldman in particular has seen several senior bankers decamp, including media banker Joseph Ravitch, who earlier this month announced plans to leave. Energy banker William Wicker last month said he would jump to Morgan Stanley.

Also in February, Suzanne Donohoe, who ran Goldman’s asset management international unit, left to join Kohlberg Kravis Roberts & Co.

Editing by Maureen Bavdek

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