Archive for the ‘Uncategorized’ Category

David Milliband ‘Smoking Gun’ for No 10?

April 17, 2006


Newspaper reports over Easter drawing David Milliband, Minister of State for Communities and Local Government, and former private secretary to Tony Blair,  into the ‘loans for peers’ scandal has raised Whitehall gossip of a No 10 ‘smoking gun’ There are also reports that the police, who have already arrested a former Government adviser in connection with the scandal want to interview a number of other people, including the Prime Minister.

The loans came to light after the committee responsible for vetting the nominees queried three of those recommended by Labour. Dr. Chai Patel, head of a chain of psychiatric clinics which has contracts with the state-run National Health Service, gave Labour a loan of £1.5 million, but he was blocked by the committee. Stockbroker Barry Townsley and Sir David Garrard, a property developer, subsequently requested their names be removed from the peers’ list, amidst complaints that the status and prestige of the titles they were promised has been undermined by Blair’s readiness to grant so many of them.

It emerged later that at least two other wealthy businessmen, Andrew Rosenfeld and Gulam Noon, the curry tycoon,  had also lent Labour money before being nominated for peerages.

Thanks for reading Big Business

David Davis


Nice guy Charles Dunstone on a BT mission

April 11, 2006


Carphone Warehouse has an odd name for a company that doesn’t sell car phones and isn’t a warehouse.  It is Europe’s biggest mobile phone retailer whose founder Charles Dunestone is on a mission to become the telecoms alternative to BT.

Today Dunstone took the challenge direct to the heart of BT by announcing free broadband access forever for customers of his Talk Talk service.  It is a move that will undoubtedly change the landscape for all other broadband providers such as NTL and AOL.

Dunstone is the minnow in the pack but few will bet against his succeeding given the way he has built the company from scratch into a £2 billion business with 1,400 stores in 10 countries.

Not bad for a 42 year old who gave up the opportunity of going to Liverpool University in favour of going to work, first at a computer computer in Cambridge and then for NEC, the Japanese telecoms giant where he spotted the opportunity for selling mobile telephones.

He started by selling them by advertising in magazines and then he opened his first shop.  The network grew rapidly as he hired people from Tesco and Waitrose to introduce a new type of marketing techniques for mobile phones.

As BT has been gradually forced to loosen its hold on telephone landlines, Dunstone was quick off the mark to step in with his Talk Talk service.  The free broadband service is the latest stage in this strategy.  It is aimed directly at home computer users which are predicted to grow to around 20 million inBritain within the next few years.

Dunstone is not the typical entrepreneur and outside of business keeps a low profile.  Few will argue that his ‘nice guy’ reputation is not justified.  He enjoys public speaking, is closely involved in the work of The Prince’s Trust and is yachting mad.

Thanks for reading Big Business

David Davis


Ayling takes £120,000 job at Sanctuary

April 5, 2006


Bob Ayling, the former chief executive of British Airways, has taken centre stage as the £120,000-a-year chairman of troubled music group Sanctuary.

He has brought with him fellow Holidaybreak director James Wallace, who joins the group as senior independent non-executive director and chairman of the audit committee.

His arrival at the company, whose artists include Beyonce and Iron Maiden, follows a £110m rescue refinancing.

He has brought with him fellow Holidaybreak director James Wallace, who joins the group as senior independent non-executive director and chairman of the audit committee.

His arrival at the company, whose artists include Beyonce and Iron Maiden, follows a £110m rescue refinancing.

Thanks for reading Big Business

David Davis

The Amersham Man retires

April 5, 2006


Sir William Castell,  one of the most high-profile members of Britain's biotechnology sector who masterminded the sale of Amersham to General Electric of the US, is retiring this week.

Sir William, who is 58, became head of GE Healthcare when he sold Amersham to the US giant in 2004. He will retain a seat on GE's board and also become chairman of the Wellcome Trust, the high-profile medical charity.

Amersham, named after the Buckinghamshire town where it was based, was Margaret Thatcher's first privatisation in 1982, when it was spun out from the Atomic Energy Authority. Amersham was valued at £71m at its flotation price.

Sir William joined the company in 1989 and steered it through a number of transformational deals, ending in a sale for almost £6bn to GE.

Thanks for reading Big Business

David Davis

Rose thanks M&S staff with £65m bonus

April 2, 2006


In 1972 a young lad from Yorkshire who went to a Quaker boarding school joined the Marks & Spencer management training scheme. Stuart Rose stayed for 17 years and had risen to head of M&S’s European division in Paris when he moved on to build a reputation as a shrewd operator who could tur around struggling retail companies.

In 2004 Rose was called back to M&S, this time as Chief Executive;  a £9 billion takeover bid on the table for the once mighty king of the High Street which had lost its way with falling sales, a diminishing share price and vanishing customer appeal

The rest is already history. The takeover was thwarted, stores were revamped, fashion modernized, and marketing was given a fresh zest with window displays and advertising campaigns designed to lure younger customers. More importantly Rose brought back M&S’s old values of quality and service.

In the near future Rose will be reporting increased sales and profits to happy-again shareholders and he will also be saying  ‘thank you’ with a £65 million bonus to the 63,000 M&S staff who have made it all work.

Now we know what ‘a shrewd operator’ really means.

Thanks for reading Big Business

David Davis

Who’s gambling on The Sportsman?

April 1, 2006

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L/R Jeremy Deedes, Max Aitken, Ben & Zac Goldsmith

An amusing £2 million television advertising campaign for The Sportsman, is attracting more attention than Britain’s latest daily newspaper it is advertising.  The ads show a bookmaker refusing to allow a customer to place a bet because he is carrying a copy of The Sportsman.

But this will not be too much of a concern for the group of investors in Sports Betting Media Ltd, who are gambling £11.5 million on the paper's launch because they expect to make a killing not from newsstand sales but from the dramatic growth of the £40 billion a year Internet sports betting.

The investors are a motley crew and include the former Telegraph Newspapers chief executive, Jeremy Deedes, who is chairman of SBM;  Max Aitken, the 28-year-old great grandson of Lord Beaverbrook, creator of the Express newspaper group, and the Sportsman's managing director; Ben and Zac Goldsmith, sons of the late Sir James Goldsmith, the controversial financier; a syndicate led by Ben Arbib, son of the city financier Sir Martyn Arbib; James Osbourne, managing director of Aspinall’s and property tycoon Martin Myers.

When fully up and running The Sportman’s website will carry links to online bookmakers and gambling sites in return for a share of the revenues made from readers clicking through to place their bets.

The first test will be the World Cup in June which is expected to be the biggest sports betting event ever.

I know who I would put my money on.

Thanks for reading Big Business

David Davis .

Lord Sainsbury ‘forgot’ £2 million Labour loan

April 1, 2006


You’ve got to be seriously rich to make a loan of £2 million – and then forget about it.

Well that’s exactly what happened to Lord Sainsbury, the latest rich man to get caught up in the Labour Party loans scandal.

The heir to the Sainsbury supermarket fortune, Labour’s Science Minister since 1996, loaned the money to the party but has now admitted wrongly disclosing it to the senior senior civil servant in his department. In fact he had disclosed an earlier £2m gift, but not the £2m loan, which he had forgotten.

Lord Sainsbury’s memory lapse is not so surprising for a man worth anywhere up to £2 billion and according to political commentators has given the party an estimated £11 million in recent years.

In 2003 Mark Seddon, a member of Labour's National Executive Committee, told the BBC, 'In any other country I think a government minister donating such vast amounts of money and effectively buying a political party would be seen for what it is, a form of corruption of the political process.' Seddon said it was causing Labour to lose members amid criticism from the grassroots that the party was now 'in the pockets of the powerful and the rich'.

With such wealth the science minister has been able to spend vast sums in pursuit of his twin passions, science and politics.

In the 1980s the then plain David Sainsbury bankrolled the Social Democrats and was a particular admirer of the party's leader Lord Owen. However, he switched horses Labour when it moved toward the political centre following the collapse of the SDP/Liberal alliance.

He has also huge investments in the development of genetically-modified food and these financial interests have aroused controversy at a time when the government has come under attack for not banning GM crops.

Lord Sainsbury's interest in science was kindled at Cambridge University in the sixties. Although initially a history student he transferred to psychology because of a fascination with the breakthroughs then being made in the study of DNA.

He once said that if a fairy godmother were to grant him a wish it would be to become a Nobel Prize winner in plant genetics.

This passion for genetic research led him to donate £200m of Sainsbury shares to the Gatsby Charitable Foundation which funds work into genetically improving the resistance of plants to disease.

Thanks reading Big Business

David Davis

Bernie & Max – Formula One’s Odd Couple

March 29, 2006


Give Bernie Ecclestone (right) due credit…..he knows how to eat his cake and keep it.

He has sold for an undisclosed sum the commercial rights of Formula One motor racing to private equity firm CVC Partners after months of negotiations but stays one as chief executive and a shareholder to further build the business.

Where that leaves Max Mosley,(left) the other half of Formula One's Odd Couple, remail unclear.

What is more certain is that at 75, and after more than 30 years Ecclestone is finally loosening the stranglehold on the business he created and which has given him and his wife Slavica wealth running into billions of pounds.

Not bad going for the Suffolk trawler skipper’s son  who left school at 15;  although he ultimately got a chemical engineering degree from Woolwich Polytechnic, even as a teenager he was competing in motorsports, both on motorcycles and eventually racing a 500cc Formula 3 Cooper on a regular basis until an accident ended his career in 1951.

He went into team management and eventually took over the whole of F1. A bond issue in 1999 and the sale of 75% of the business a year later netted Ecclestone £1.9 billion. That money was transferred to Jersey-based trusts controlled by  Slavica. But when German media giant Kirch, which had bought the 75% stake, went bust, its bankers took the shares. A court battle followed because they wanted thei money back and it has never been clear.

According to the Sunday Times, whatever happens, Ecclestone has some choice assets to enjoy, including a £75m yacht, a £12m jet, a £5m London home and his own hotel and chalet at Gstaad. BusinessF1 magazine valued him at £2.323 billion in late 2003.

Where the new deal leaves Max Mosley,  Ecclestone’s “other half” is equally unclear but you can be certain he will be in the winner’s enclosure.

From their resumes, you would not have predicted Bernie and Max as a match made in heaven.

Max, in his university days, was secretary of the prestigious Oxford Union and became a respected lawyer before venturing into Formula One. Like Bernie, Max also dabbled as a driver in Formula 2 and as a club racer. Max also came from a storied family in the British aristocracy: his father was  Sir Oswald Mosley the British Fascist leader of the 1930's mother was Diana Mitford, sister of Nancy Mitford, the writer.

The Odd Couple have been linked since the early 1980’s when they and the constructors formed a group called the Formula One Constructor's Association (FOCA) to fight a  common enemy: the Federation Internationale du Sport Automobile (FISA), the governing body of Formula One that was forerunner of what is now the Federation Internationale de l'Autombile (FIA).

The so-called FISA/FOCA War: was for control of  the commercial and promotional rights to Formula One racing. Eventually after some very public squabbling a deal was struck. 

Max went on to run the FIA where he is currently in his fourth term as president so his umbilical cord with Bernie remains unbroken for the foreseeable future.

Thanks for reading Big Business.

David Davis

The Quiet “Professor” is Macquarie’s Mastermind

March 28, 2006


The Bloomberg News Service carried a piece yesterday about Macquarie Bank and it is certainly worth reading. 

It doesn’t, however, tell you much about the man who has masterminded the bank’s rise from virtual obscurity to a global financial powerhouse and which recently made an audacious bid to take over the 300 year old London Stock Exchange.

So let me fill in some CV detail of Allan E Moss, who is 57 and has been Chief Executive of Macquarie since August 1993.

According to colleagues, he is quiet, balding and bespectacled –  something of a bumbling professor – tripping over phone wires, spilling cups of coffee and falling off desks.

"He's no Donald Trump," quips one senior executive. But what he lacks in social graces,  Moss more than makes up for in financial nous. With a small top team, it he has been the adrenaline that has driven Macquarie's global expansion.

Educated at the University of Sydney and later at Harvard Business School, his early work was with the Australian Industrial Development Corporation but the bureaucracy didn’t suit Moss and he returned to the world of academia.

Then, nearly 30 years ago, he joined the local fledgling operations of Hill Samuel, the UK merchant bank from which Macquarie has emerged.  He, in fact, led the team responsible for preparing the submission to the Australian Government for the formation of the bank.  After moving up the managerial ladder he became Chief Executive in 1993 – and from then on, there has been no stopping the bank’s march to the top. 

Hardly a day goes by when Macquarie is not making another deal, mainly the acquisition of public utilities, among them a string of airports from Brussels to Rome to Hainan Island, China;  roads and bridges across Australia, Europe, Asia and North America, including the Chicago Skyway, a 7.8 mile elevated highway and the Indiana Tollway. 

The failure to acquire LSE was a rare setback for Moss's global ambitions but nonetheless Macquarie is now Australia's only independent, full-service investment bank operating in 23 countries

Despite its growth in recent years, Macquarie has been able to retain an entrepreneurial, decentralised culture, according to analysts and rivals. Moss is credited with nurturing this, at the expense of his own profile. He and his wife, Irene, who until a year or so ago was commissioner at the ICAC, Australia's anti-corruption watchdog, lead singularly career-focused lives.

With a pay packet of $30 million over the past five years, he is now reputedly one of Australia’s richest men – he has a private stake in the Gold Coast Airport and quite a taste for waterfront property.

But he is generally less conspicuous when it comes to spending it. While his investment banking peers drive sports cars with personalised number plates, Moss drives a regulation-issue Mercedes-Benz. He is almost totally absent from Sydney's furious, money-driven social scene.

His wife, it appears, is his constant companion. He met fellow arts/law student Irene Chee over a photocopier and later they sat next to each other in class. Together they decided to tackle the American Ivy League institution, Harvard; he a master's of business administration, she a master's in tax law.

Three decades on, Allan and Irene Moss spend the first part of the day together, getting in an early morning walk around their waterfront home on Sydney's North Shore, bought in 1999 and which has never had a registered mortgage.

As one friend puts it: "He is ego-less. He doesn't see why he is important, he just sees the bank….he likes people to underestimate him."

Thanks for reading Big Business

David Davis

Peter de Savary in the Lions’ Den

March 26, 2006

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First, a confession.  I am a life-long supporter of Millwall football club, the one that no one likes. So when Peter de Savary was appointed chairman I wondered why a person with his controversial business background who confesses to know nothing about soccer, should take on this onerous task of rescuing the Lions.

I had my suspicions when it was announced he has already sold and leased back the training ground; pessimists are saying he has eyes on the New Den, the club's modern ground which was built a just a few years ago.

Now, I know more of de Savary's plans..  This week he sent shareholders a 112 page document in connection with a £5m placing to put some much needed cash into the club. 

Not only does it disclose for the first time the full extent of de Savary’s financial failures of the past, it reveals a neat little option deal he has come up for himself.  Read what the Sunday Times Business News has to say.

To describe Peter de Savary as a colourful character is a serious breach of the Trade Description Act. He warrants 1,240,000 Google references… are just three I have picked at random to whet your appetite.

The Cigar Lover
Back on The Rich List
Big plans for Land’s End
Thanks for reading Big Business

David Davis