A vote on the sale of the firm’s railway technology business to Siemens will raise questions about the loss of UK assets to foreign buyers
There is likely to be some tension at the Invensys extraordinary general meeting on Wednesday between the hearts and minds (or hearts and wallets) of shareholders.
The meeting has been called for investors to vote on whether they agree with the board of the engineering company that its rail technology business should be sold to Siemens.
It looks good on paper. Most equity analysts are convinced that the £1.7bn being paid by Siemens is a steal – for the seller – and question the wisdom of a deal at that value for the Germans. The amount being paid for 40% of Invensys is equal to the entire company’s stock market value before the news broke.
But hearts may question if it is good for UK plc to see this latest piece of British knowhow moving into foreign hands. It could join a list of British brands that have gone into overseas ownership, including Rolls-Royce cars, P&O ships and the Savoy hotel.
It is certainly a question for Sir Nigel Rudd, the chairman of Invensys, who has already overseen the transfer of Boots the Chemist and Pilkington glass to foreign buyers. Presumably he has checked that activist retail shareholder Captain David Hawker, who led a spirited attack on the P&O board for selling out to Miami-based Carnival Corporation, is not on the invite list.
Steward’s inquiry at Sportingbet
A line of red flags at online turf accountant Sportingbet, which is due to hold its annual general meeting on Wednesday.
Shareholder adviser Pirc is urging a vote against the annual report on several grounds: that senior independent director Rory Macnamara is anything but; that chairman Peter Dicks sits on the board of longtime Sportingbet financial adviser Daniel Stewart and Co; and that executive severance terms are unacceptable.
Macnamara’s biography on the company website does not mention that he, like Dicks, is a director of social housing contractor Mears Group, and that until recently he sat on the board of Private Equity Investors, a fund Dicks chairs.
Contrary to the governance code, which recommends no more than a year’s notice, Sportingbet boss Andrew McIver will get two years’ worth of salary, bonus and pension perks if he is made redundant, netting him £2.4m.
It’s a live issue. But Sportingbet’s board has agreed in principle a cash-and-shares takeover offer from William Hill and GVC Holdings, which looks likely to be formally accepted on Tuesday. If Sportingbet holds up the white flag, there won’t be that much need for any red ones.
Humiliation looms for UBS
Another dump of damning emails will land this week as UBS pays the price for attempting to manipulate Libor. As if the Swiss bank has not already proved how out-of-control its traders have been with the jailing of Kweku Adoboli for hiding £1.5bn of losses, it is on the verge of admitting that the rate-rigging scandal could cost it as much as £620m in fines with regulators around the world.
While the size of fines hitting the banking industry seem to get bigger every day – HSBC paid out a whopping £1.2bn – the revelations attached to the fines are particularly eye-catching. HSBC, for instance, was done because it had controls so lax that it laundered money for drug barons and bust sanctions with states deemed pariahs by the US. Among the details to emerge were the larger-than-usual cashier windows in Mexican branches to get more notes through.
In the case of Barclays and Libor rigging, it was the little remarks the traders sent each other on instant messages as they fixed rates that were so illuminating. “Done for you big boy” will take a long time for Barclays to live down. Not long now until the email dump by regulators will produce a line with which to tarnish UBS.