The Rothschild touch
he people with the winning ideas, this time round, are undoubtedly the old firm of N. M. Rothschild. Theirs was the plan which set Rio Tinto-Zinc raiding Enterprise. Now, investment managers think, RTZ has only to sit tight until the Government's veto on a takeover of Enter- prise runs out. Then RTZ sells its other North Sea assets for Enterprise shares, soon gets its holding of those shares up to 75 per cent of the company, puts the two together and claims tax relief on all its own early ex- ploration costs. So while RTZ waits, its dividends from Enterprise come to less than the cost of financing the investment? So there is a beautiful tax loss to carry for- ward. The ironies resound. Graham Hearne, chief executive of Enterprise and evidently less than enthused to find RTZ staring over his shoulder, learned the financial business at Rothschild. RTZ itself has been, up to now, one of Kleinwort Benson's biggest clients. Kleinwort, however, was advising the Government on the Enterprise sale, and also advising Enterprise. Now Enterprise, wanting to know what do do about RTZ, has sought advice — from Schroders. Straight faces are being maintained all round. No merchant banker would admit to envying Kleinwort its mandate to sell Enter- prise, and Airways, and Telecom. Still less would he want to pinch a good client or two for himself. Bateman could draw all the sanctimonious expressions, too.
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