CITY DIARY
CHRISTOPHER FILDES
My tenure of office, now I come to look back on it, has been one damn takeover after another. Some have been bigger and more important than that for the News of the World; but none has given me half so much honest enjoyment.
For a start, we have Mr Maxwell's assurance that there will be no change in the editorial policy of the News of the World. For a taste of that policy, turn to last Sunday's News, where besides a sterling leader stressing the Britishness of the paper and making heavy play with Mr Maxwell's birth in a less happier land, we have such headlines as 'Brutal boaster took bra for a trophy,"She trundled her bed into the kitchen . . .,"Men and me, by Diana Dors,' and 'Exposed : a plan to flood Britain with cut-price muck.' This must not be tampered with, and Mr Maxwell's words are welcome. His fellow publishers, though, point out that, dog savaging dog, he gave evidence for the Crown in the prosecution of Calder and Boyars over Last Exit to Brooklyn.
That antipathy goes further back; in fact, to the collapse of Simpkin Marshall. There were at that time two wholesale booksellers: one a part of W. H. Smith, the other, Simpkin Marshall, controlled by Mr Maxwell. It failed. This was a disaster for the book trade, and some publishers suffered losses from which they never fully recovered. Mr Maxwell for his part says that the book trade never gave Simpkin Marshall the support it needed. Now Simpkin Marshall's creditors must watch from the sidelines as Mr Maxwell ups a f26 million takeover bid by £7 million.
But, these ironies apart, this is a grand bid for the aficionados of the takeover code. Mr Maxwell's opening gambit was to agree to buy the Jackson family's shares at the bid. price but to release them if a higher bid came along. Ought Rothschilds, who handled the shares for the Jacksons, to have agreed to this? Doesn't it amount to preferential treatment for certain shareholders? Me, I don't think that in terms of business morality it matters a row of beans, but (as the Issuing Houses Association so nearly said) you musn't flout the takeover code just because you happen to think it silly.
Then there's Hambros, for the defence; and nobody better at the blocking operation which they have taken on with such gusto. Thanks to Hambros' buying in the market, the defenders now control more than two-fifths of the shares. This is usually strong enough to see a bidder off: it proved so, for instance, when last summer my was fending off Showering's. Hambros did that one, too. Under the takeover code, if you make a bid and also buy shares in the market, the people who accept your bid (if it goes through) must not be paid less than the average price you have paid in the market. No such compulsion rests on you if you're buying in the market to block a bid. There is an omnium gatherum clause in the code which says that you mustn't act adversely to the interests of share- holders as a whole. But I rely on Hambros to have an answer ready for that one; and in any case it can scarcely mean that they have to give your aunt in Bournemouth the same price for her shares that they gave the Sun Life.
Life is real, life is earnest in the City; and your aunt does not really rank with the Sun Life; and any code that pretended that she did would be founded on error; and that the error would be a pious and well-meaning error would make it none the less erroneous. This wasn't sufficiently remembered when the code was drafted. When the code is redrafted, it will need to be.
Some people, of whom the Governor of the Bank of England is one, are obliged to spend a fair amount of their time stating the pre- dictable for the sake of the record. You know the sort of thing: Archbishop believes in God, Governor believes in sterling; un-sensation.
The ritual has point only because it isn't always followed. Mr Callaghan, asked a predictable question on the Thursday before devaluation, in utter exhaustion gave an un- predictable answer, which was later costed at about f3 million a word. That, of course, was a mistake. Governor O'Brien also varies the ritual, but as a matter of technique. I enjoy seeing him in action. Ten months ago, in the presence of the Prime Minister—who had blamed devaluation on the wicked speculators —the Governor blandly observed that anyone who had been speculating against sterling had been perfectly right. Last week, at the Bankers' Dinner, he repeated-the stroke. 'For my part, I find the tendency to attack the role of gold in the [monetary] system somewhat ironic, when it is not gold that is the root cause of the present uneasiness but doubts about the alternative reserve assets. While admitting all the imperfec- tions of gold as a monetary asset, the enthusiasm for getting rid of it owes much to the fact that in this inflationary age currencies cannot stand comparison with it.'
None of which stops the Bank of England joining with the Federal Reserve in trying to keep the price of gold down. It just has the— ritually reassuring—effect of reminding every- one that the Bank has its eyes open.
Well, well, well, now look what we've got— two Barclays Banks. There is the Barclays we all know and love, and there is the Barclays Bank Ltd Corporation of Avenida Balbao, Panama 5, Panama. No relations; as Barclays Bank the First would like to make perfectly clear.
What is worrying the Lombard Street Barclays is that their namesakes on the Avenida Balbao (incorporated and inscribed in the Panamanian Public Register in July, 1964) have issued bearer cash bonds in amounts of $100,000, carrying coupons for interest. By an even odder coincidence, these bonds show not only the name Barclays but 'an emblem similar to the spread eagle crest used by the Barclays
group of banks for many years and widely - known throughout the world.' If someone takes one of these bonds into a branch of what I shall call for clarity's sake the wrong Barclays and asks for his interest, or indeed for his $100,000, an ugly scene is to be feared.
I take off my Panama hat to the ingenious gentlemen on the Avenida. But they haven't really taken their idea to its limit. There are strict rules about which United Kingdom com- panies can call themselves banks. But in countries where the rules are laxer—the Bahamas, say, or if you can't afford the fare then the Channel Islands—you can form a bank for the price of -a brass plate and it can open branches in the United Kingdom. Many are the grandiosely named banks which have thus added themselves to the British scene: I dare say that a majority of them are still solvent. But instead of opening the Brave Noble and Super Bank Limited, incorporated in Tangier and taking deposits in London, what about a quick trip to Nassau to set up a do-it-yourself Midland? By the way, if you want to call your- self Barclays don't try to incorporate in Panama. It could get you into trouble.
And now I must raise a valedictory hat to you, bow, and depart. But first may I draw your attention to a heartening discovery of mine in the writings of The Master? Bertie reflects (Jeeves in the Offing) on Kipper Herring's success in attracting the affection of the lovely and choosy Roberta Wickham, though 'an un- safe entrant to have backed in a beauty contest, even if the only other competitors had been Boris Karloff, King Kong, and Oofy Prosser of the larones; How, Bertie wonders, was this done? 'His brain . . . might have helped to do the trick. You can't hold down an editorial post on an important London weekly paper without being fairly well fixed with the little grey cells, and girls admire that sort of thing.' Isn't that good news? Marylebone papers please copy.
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