They already control Associated British Foods, owners of British Sugar and and the upmarket Heals and Fortnum & Mason stores. Galen is thought to be preparing a bid to rival that rumoured to be in the works from Tom Hunter, the Scottish retail entrepreneur. Nobody has yet put a formal offer on the table, so if you own the shares, it might be a good time to take advantage of all the excitement and take some profits.
Meanwhile, John Lovering and Bob MacKenzie have identified themselves as the bidders for Somerfield, the supermarket chain. Neither are household names, but they have formidable reputations: Lovering used to run DIY chain Homebase, while MacKenzie restored the fortunes of National Car Parks. The shares, long one of the sector’s worst performers, have perked up and are worth a flutter.
Corus, the former British Steel, has followed a long tradition among crisis-hit UK companies by bringing in a foreigner to sort out its problems. He’s Philippe Varin, a Frenchman, and he’ll fill the chief executive’s seat recently vacated by Tony Pedder. Sir Brian Moffat, the chairman, is also retiring in May. Corus needs heavy restructuring, as its loss-making UK steel operations are spread over too many sites, and too much money is spent moving products between them.
But Mr Varin’s first task will be to mend fences between the UK and Dutch arms of the business, which have recently been at loggerheads over the proposal to sell the firm’s aluminium business to Pechiney, Mr Varin’s former employer. He held a variety of positions there, and is by all accounts an excellent leader, but years of poor management have left a mountain of problems at Corus and we’d still steer clear of the shares.
Cheap online share dealing could be under threat thanks to interference from Brussels. The ‘Investment Services Directive’ is a typical EU proposal – noble in aim, appalling in reality. Article 18 stipulates that a full fact-find is carried out by a broker to determine the buyer’s level of experience and risk profile before any transactions can take place. Brokers warn that this will lead to endless red tape and higher costs. We agree. Trying to eliminate the risk from equities is pointless – it is precisely because they are riskier investments that they offer potentially better returns. Investors should take responsibility for their own decisions and research products properly before parting with their cash. And Brussels should concentrate on building a functioning pan-Europe clearing, settlement and banking system along American lines, not meddling with individual transactions.