London Weekend Television
Not altogether to my surprise Dr Tom Margerison has departed and the matter of the succession has been resolved with the welcome arrival of Rupert Murdoch and his men in executive control.
There is no reason for anyone to think (other than those who are never wrong and have permanent delusions of elitism), that they will not be able to maintain the stan- dard put forward in the original prospectus. At the time of the awards of the contracts it Was maintained by Independent Television's critics that London Weekend Television had not set itself a particularly high standard.
Now that the levy has been reduced it is to be hoped that excessive staff will continue to be cut back and other economies made. The new executive committee includes heuristic accountant Peter McNally who will, I hope, be able to persuade Mr Murdoch to turn London Weekend into a public corn-
pany on the strength of a profit projection in the coming months.
A public flotation is not appropriate since the shares of television contractors sell, at the moment, on a low price earnings ratio. In addition the new company would have poor asset backing for further money-raising, or more important, takeover activity. Within six months it should be possible to forecast profits for another year when London Weekend Television might arrange to be bid for by a quoted company such as a property situation. The News of the World would of course be inappropriate for obvious reasons. Obtaining a quotation by a reverse takeover in this way would provide a base for further growth and would guard against the pos- sibility of the licence being withdrawn in 1974.
The Independent Television Authority has no valid reason for resisting a tactic of this kind which will be used more in the future to bring companies with good profits but low asset backings to the market.
Only one man capable of undertaking a venture on a sufficiently large scale, Mr Jim Slater, is particularly good at this sort of thing. Let us hope that London Weekend Television's 'house' merchant banker Mr David Montagu will stand aside.and let Mr Murdoch and Mr McNally make plans with Mr Slater since it is important to line up a quick succession of takeover prospects to follow the marketing so that benefit may be made from the high share price that will almost certainly occur once the share-buying public know that a quick-growing property situation is being developed.
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