CITY AND SUBURBAN
When Plymouth Argyle plays Manchester United, don't let Buggins referee
CHRISTOPHER FILDES
Iwish John Walker-Haworth all success, but we must be thankful that his name is not Buggins. It is his turn to take over at the Takeover Panel. It was his bank's turn to lend the Panel a director-general. The Panel has worked that way ever since the Bank of England conjured it into being, the better part of 20 years ago. Displeased by the rough takeover tactics of the day, the City's nanny uttered her familiar warn- ing — if the naughty children would not tidy the nursery themselves, others would do it for them, and they would not like that. Really, the children have done well: nanny can be proud of them. The Panel has been accused, at different times, of making up its rules as it went along, of changing the rules in the middle of the game, of making too many rules, and of being too rule-bound. That may add up to a compli- ment. It has never lost its original sense of fairness, especially as between one share- holder and another, and it has the vital virtue of speed. Warring bankers and brokers, objecting to each other or seeking guidance, can rush round to the Panel in the morning and get their answer in time for coffee. That answer is backed by no powers of law, and the Panel, offered those powers under the new Financial Services Bill, has, rightly, declined them. It is therefore at its best with the old, club-like, City and has few sanctions against those who never belonged to the club and would not have joined if they were asked. There are going to be more of these as the City's revolution rolls on. The exclusive clubs are seeing their doors broken down, or their membership becoming more a social than a practical matter. The big American-owned investment banks will not wait to be elected to the Accepting Houses Commit- tee. Immediately, the Panel has to referee a takeover game which has never been fiercer, or played for higher stakes. Profes- sionalism is everything. We saw that most plainly when Guinness overran Bells. The two companies were evenly matched (Bells had a good record, and a much longer one than Guinness's) but their merchant banks were not. Guinness fielded Morgan Gren- fell, Bells fielded Ansbachers. It was like betting your business that Plymouth Argyle could beat Manchester United. To the Morgans and their like, that sort of reputation is worth a small fortune in fees and a bigger fortune in advertisement. At this level of intensity the game gets harder to control, and it is not surprising that sections of the crowd have (fairly or not) taken to barracking the Panel. Its habit is to borrow its referee-in-chief from one of the First Division clubs, and the experi- ment of going outside (to one of the big accounting firms) has not been repeated. The clubs take it in turns to second their men. It follows that, when a new director- general has to be found, the question is not who is the best man in the market, but who is the best man at the bank whose turn it is. That can limit the field in more than one way. Within recent memory, the best man at X's Bank was a brilliant financial en- gineer, but by no means the extrovert and authoritative type of a strong referee. The Panel turned, not to another bank, but to a second choice from X's. Even when the star player is the right man, can his bank reasonably be expected to do without him, in today's conditions? Could the Panel expect to borrow George Magan or Roger Seelig from Morgans, Trevor Swete from Hill Samuel, Michael Richardson from Rothschilds? Warburgs, the Liverpool of this league, have answered that question, now their turn has come round, by looking outside their domestic team. Mr Walker- . Haworth comes back from eight years in the Far East, the last three running East Asia Warburg in Hong Kong. His City experience was with Cazenoves, and cer- tainly no side puts in a better-polished boot. It may well be, with the newcomers moving into the City and with the securities markets becoming more international, that Mr Walker-Haworth's overseas experience will be just what is needed. I worry,
though, about the process of selection. One of these days the Panel will be landed with a Buggins, because it is his turn.
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