Archive for the ‘Revolving Doors’ Category

Sir David Arculus: Resigns before official CBI announcement

March 20, 2006

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The next president of the Confederation of British Industry, Sir David Arculus has surprisingly resigned before taking up the leadership of Britain’s employers’ organization.

The reason?  Severn Trent Water, the main subsidiary of the FTSE 100 water group Severn Trent that he chaired between 1998 and 2004, is under investigation by the Serious Fraud Office.

Severn Trent Water was recently £42m fine by the industry regulator, Ofwat, for supplying bad debt figures that were “either deliberately miscalculated or poorly supported”. As a result, Severn Trent Water’s customers have been overcharged.

Sir David’s plc board was exonerated of blame, but were criticized for its handling of the company’s internal investigation.

He has resigned ahead of the CBI issuing its own agreed statement later today; he feels he has done nothing wrong but does not want the CBI’s reputation being tarnished by any newspaper campaigns against him.

Educated at Oriel College, Oxford Sir David, whose first job was as a Voluntary Service Overseas teacher in the Falklands Islands, has also just stepped down as chairman of mobile group O2 following the takeover by Telefonica, the Spainish company.

Sir David, 60 in June, will continue to look for a FTSE 100 chairmanship. He lost out for the top job at Lloyds TSB and has turned down Trinity Mirror because he regarded it as a backwards step. In the meantime he is a non-executive director at Barclays Bank, and Pearson, the publishing group and he also remains on the Telefonica board.

Thanks for reading Big Business

David Davis
www.writer4business.com

Outsider Sam Laidlaw is Centrica’s new chief executive. Is a bid on the way?

March 14, 2006

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The appointment of Sam Laidlaw as chief executive of Centrica , by-passing two hotly tipped internal candidate, signals that  the owner of British Gas expect to be involved in the energy industry’s current enormous consolidation.

With speculation that Russia’s Gazprom is said to be mulling a bid and the $72 billion merger between Franco-Belgian energy group Suez and Gaz de France, observers believe Laidlaw has been chosen because of his experience in big deals – just 50 he is best known for revitalizing and later selling out Enterprise Oil to Shell in 2002 for £3.5bn before becoming president of America’s Amerada Hess.

He joins Centrica from oil giant Chevron where he was executive vice president of global business development.

His appointment sees the company overlook finance director Phil Bentley, who was an original frontrunner, and Mark Clare, deputy chief executive and managing director of British Gas, who was also considered, to replace out-going chief executive Sir Roy Gardner who is expected to become chairman of catering group Compass.

Laidlaw received a master’s degree from Cambridge University, was admitted to practice law as a solicitor in 1979 and obtained a master’s degree in business administration from the European business school INSEAD in 1981.

He has been active in various industry and civic organizations, including serving as president of the United Kingdom Offshore Operators Association, chairman of the Petroleum Science and Technology Institute, and a member of the United Kingdom Energy Advisory Panel. He is a member of the United Kingdom Council of INSEAD; a non xecutive director of Hanson PLC; and a trustee of RAFT, a medical charity. Laidlaw also serves as a fellow of the Royal Society of Arts and a director of the Business Council for International Understanding.

Thanks for reading Big Business

David Davis
www.writer4business.com

Two chairmen heading for the exit

February 12, 2006

This week will see at least one chairman walking the plank and another almost certain to do so, both in the face of unhappy shareholders.

Ian Gowrie-Smith will be stepping down from the board of SkyPharma, the drug firm he has chaired for all but three weeks of the last 11 years.

In the view of shareholders Gowrie-Smith, has failed to deliver promises of growth and profits.

A former mining entrepreneur, he has spent 20 years trying to build a pharmaceutical business in London. In the 1980s he created Medva, a stockmaket star unil 1993, when it was hit by manufacturing-quality concerns. Sky, despite early promise, has followed a similar path.

Dissident shareholders will also be trying to unseat Derek Lewis, chairman of Patientline, which operates bedside telephony and television in hospitals. Patientline has more than £80 million in debts and losses of nearly £30 million since its flotation in 2001.

In the early days of his career, Lewis was Chief Executive of the Granada Group who subsequently led the team that created UK Gold Television.  He was appointed Director-General of the Prison Service of  England and Wales in 1993.  Two years later he was controversial dismissed by Michael Howard, the then Home Secretary and eventually won £250,000 in an unfair dismissal claim.

An extraordinary general meeting has been called by unhappy shareholders who are claiming nearly 50% support for Lewis’ dismissal and so Lewis looks like following Gowrie-Smith out of the door.

Thanks for reading Bid Business.

David Davis
http://www.writer4business.com

Dick Parsons faces toughest battle yet

January 31, 2006

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Dick Parsons, born in th economically disadvantaged Bedford-Stuyvesant section of Brooklyn in 1948 and raised in the rough and tumble Jamaica, Queens, has spent most of his profession life fighting – and usually winning – uphill battles.  Today he faces the biggest so far when Carl Icahn, the serial activist investor launches a campaign to remove Parsons from his job as chairman and chief executive of Time Warner.

Parsons took over in 2002 after Time Warner’s ill-fated $300 billion merger with AOL which turned out to be the worst in the history of misbegotten mega-mergers and the compny subsequently recorded the largest write down in the history of American business – an astonishing $90 billion.

Parsons continues to defend his conglomerate structure but plans to spin off 16% of Time Warner Cable when its acquisition of Adelphia is completed this year.  Icahn wants more radical change, including the spinning off of the entire cable business and the company to buy back $20 billion of shares.

The decisive shareholders will be in May and the going will be rough but Parsons is a big man in every respect and a tough fighter as his business track record shows. A lawyer, he cut his political teeth in Washington in the aftermath of Watergate and later joined a blue-chip law firm where he quickly established a reputation as a can-do problem solver with a soft touch.

He was called in to rescue the huge and deeply troubled Dime Savings Bank of New York by masterminding a complicated merger with Achor Savings Bank which created a $20 billion financial institution with impeccable credentials.

Parsons is an Africn American of prodigious accomplishment and massive physical presence – he’s broad-shouldered, deep-voiced 6 foot 4 – who nonetheless has been underestimated throughout his career.  Some people have blamed racism but it is also the result of his own effort.  In that way that some people work hard to smooth their rough edges, Parsons has endeavoured to shrink himself to better disam foes and rivals.

Unpretenious and low key, he will need ll of his business acumen and diplomcatic skills to ward off the Icahn attacb but observers say they wouldn’t bet again Parsons.

Sir Victor’s off to the bank

January 23, 2006

Serial chairman Sir Victor Blank – his current top job portfolio is Trinity Mirror newspapers and GUS, the retailer group – is on his way to the next one.

The ink on the contract is yet to dry but Sir Victor is set to become chairman of Lloyds TSB, the bank but he will be giving up Trinity Mirror and may also have to let go GUS because corporate governance guidelines forbid anyone becoming chairman of two FTSE 100 companies at the same time.

Sir Victor’s departure will probably put the ‘For Sale’ at the Daily Mirror and could also signal that Lloyds TSB is to get a makeover in readiness for a sale, with Bank of America already in the frame as a possible bidder.

 

A family matter at Nike

January 23, 2006

It’s never easy to find a successor to the founder of a business but when it is Nike, the world’s largest athlete shoe company, with 57,000 employees and $12 billion plus in sales, it is almost a Mission Impossible.

But Philip Knight, 66, thought he had found the perfect person when in December 2004,he retired as chief executive and appointed, to everyone’s astonishment, an outsider – William Perez, a 34 year veteran of SC Johnson & Company in many top brand marketing jobs, including president.

Despite a public welcome of high expectation from Knight things haven’t worked out and today Perez announced his resignation saying “Phil and I weren’t entirely aligned on some aspects on how best to lead the company’s long-term growth”.

Maybe the problems stemmed from Knight’s decision to remain as chairman and couldn’t keep away from day to day operations or that Perez simply wasn’t a Nike family man.

A clue might be found in Perez’s successor – long-time Nike president Mark Palmer who Knight passed over in favour of Perez.