Ask nastily, Norman
THERE was a time when ICI had half a million shareholders. Now, with the de- cline of the private investor, the numbers have fallen — but there are still 348,000, and ICI needs every one of them. Com- panies with a few major shareholders are like banks with a few big depositors. Half a dozen people can sell them out or bring them down. There is safety in numbers, ICI is looking for them, and has started to offer its private investors a share dealing service and a Personal Equity Plan. What it cannot do, though, is to bring in the private investors by offering shares to them. Gov- ernments can do that, in privatisations, and so can Robert Maxwell in selling Mirror Group Newspapers. Public companies can- not do it, because their big institutional shareholders will gang up to stop them. They will vote together to ensure that new shares are offered to existing shareholders, in proportion to their holdings. By that rule they seek to perpetuate their control and to keep the private investor in his lowly place. Norman Lamont has been asking them nicely to move over: 'The right to maintain a holding does not imply the right to any particular degree of con- trol. There is nothing sacred about a particular institution having 3 per cent of a given firm's equity.' Just so, but they have been asked nicely before, and for all the difference it made, they might as well have been listening to an Icelandic saga in the original Norse. The Chancellor is not short of menaces. He knows, of course, how to deal with cartels and restrictive practices. His nuclear threat to the institutions would be to bomb their tax privileges. He should let them know that they have heard his last polite request. He can always ask nastily.
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