by Alan Bristow
The market in Indonesia in the early 1970s looked vast – sufficient to replace Abu Dhabi, Dubai and Iran all in one. Thanks to this market we were able to start re-building our revenue position quite quickly. As well as the JetRangers we were operating Bell 205s on an intensive basis. Productivity was good and our relations with Caltex were excellent. We had hard-working partners in Masayu Trading, who helped us get all the licences we needed. Contract followed contract. After Caltex came Union Carbide, Rio Tinto, International Nickel, Kennicot Mining, Mobil, Total, Agip. Doing the rounds in Jakarta I met a well-educated man who had a ministerial post of great influence, and he agreed to help me to get more licences when the time came. He also told me that the President’s son, Bobby Suharto, was playing with helicopters. Bobby was a rich man’s son with nothing to do, and I thought he could be very helpful to Bristow Helicopters. We did have serious political problems to overcome, particularly as the man who controlled all the operating licences for helicopters in Indonesia, Dr Rudi Habibie, was an agent for the French. Habibie, who was technology minister, made it a matter of policy that any helicopters coming into Indonesia had to have more than two rotor blades, a fairly blatant attempt to favour the French. He later took over the Presidency from Suharto and set up a company manufacturing the Aerospatiale Dauphin under licence.
Bobby Suharto had got hold of four or five Russian helicopters for next to nothing and set them to work on oil exploration contracts, but had trouble maintaining them and getting parts. He’d learned to fly helicopters in the United States and was generally regarded as a bit of a playboy. When we were introduced, he pre-empted my intention to suggest that we go into business as partners by making it clear that if we didn’t team up with him he’d make sure we got no more business and were forced to leave Indonesia. We worked out a deal to create a company in Indonesia that would be fifty per cent owned by him, fifty per cent by Bristows. He would operate the helicopters and run the training organisation, we would do everything else. We would standardise our equipment, which meant he’d have to get rid of his Russian Mi-4s.
What started as a strictly business relationship warmed into a personal friendship. He was quick witted and humorous, and I enjoyed his company, and of course he had the potential not only to counterbalance the pro-French faction of Dr Habibie but to open the market enormously to us. As well as having a say in the running of the joint enterprise Bobby wanted a seat on the Bristows Board. I wasn’t averse to the idea, given that he could do so much for the company, but I told him it wasn’t within my gift; I would clear it with British & Commonwealth, although I didn’t envisage that it would be a problem.
I came back from Indonesia very pleased with the reputation BHL had in the country and with the new arrangement we were planning with Bobby Suharto, which I thought was an extremely promising development in a market that could soon rival Nigeria as a profit centre for Bristows. I was tired and run-down as I flew home in the company jet; however successful these trips, they were always physically and mentally draining and it often took me several days to get over them. As soon as I landed back in London I called Nick Cayzer – by then ennobled as Lord Cayzer – to pass on the news. I always had an excellent relationship with Nick. He didn’t know my business, and he was primarily interested in the profit – Bristows was, he said, ‘the jewel in the crown’ because of its consistent record of profitability. I was allowed to run the company without constant reference to the Board for capital expenditure provided I was doing it out of cash flow – which for the most part I was – or I could negotiate finance terms that were fundamentally sound and attractive. Everything I’d ever recommended before had gone through. I’d ordered the Bristow Tigers for £70 million and told him about it afterwards; he said he’d clear it with the shareholders. He even supported me against his cousin Tony on the Chinook purchase. As long as BHL made money, Nick was happy. He didn’t need to know any details. He was already aware that we had good figures coming up yet again. I told him about the growth potential in Indonesia now that we had partnered with the President’s son, and he was well pleased. The phone conversation was entirely positive up to the point at which I mentioned that Bobby Suharto was looking for a seat on the Board. Nick’s tone was suddenly harsh.
‘No, that won’t be possible,’ said Nick. ‘I’m not having him on my Board.’
‘I don’t mean your Board, Nick,’ I said. ‘I’m talking about the Bristows Board.’
‘I’m not having a yellow face on the Board,’ Nick said firmly.
I was stunned. In the twenty years I’d known him Nick had never spoken like that.
‘Nick, this is extremely important to BHL,’ I said. ‘Indonesia could well become our most profitable market, but the competition is very keen and there are people in government who just don’t want us there. Having the President’s son as a political ally is of enormous value. This deal gives us fifty per cent of what he’s doing and gives him fifty per cent of what we’re doing. He’s a bit better off, but the helicopter business in Indonesia in future is going to be government-controlled through his company. Refusing him the Board seat he has requested would involve great loss of face for him, and that’s very important in Indonesia.’
‘I won’t have him on my Board,’ Nick repeated.
I tried once more. ‘Growth is getting very difficult to find,’ I said. ‘If we don’t take this opportunity we will be damaging our long-term prospects. I’ve worked very hard to put this deal together and I’m convinced it is in our best interests to give Bobby Suharto what he wants. It’s just a “face” thing for him – he won’t have any real influence.’
‘I will not have him on the Board,’ said Nick implacably.
I was tired, jet-lagged and mystified. ‘You’re putting me in a very difficult position,’ I said. ‘You’re telling me to do something that is not in the interests of the company. Perhaps it would be better if I just left Bristows.’
There was silence at the other end of the phone. Finally he spoke.
‘We’d better have that in writing. Just drop me a line.’
And that was it. On 22 January 1985, thirty years of building an enormously successful company ended abruptly over what I thought was a serious mistake on Nick Cayzer’s part, and subsequent events justified my fears. A year after I’d gone Bristows was the subject of a management buy-out, and British & Commonwealth spent the money they got for it on a company called Atlantic Computers, a pyramid selling racket that collapsed in such spectacular fashion that it took British & Commonwealth down with it. By then the Cayzer family had sold out of British & Commonwealth – three days before the 1987 stock market crash. Oil prices hit a historic low and Bristows fell on hard times, with large-scale redundancies and destruction of profit. Operations in Indonesia struggled on for a few more years, but without the protection of the Suharto deal I had arranged, BHL was bound to be driven out sooner or later. The last contract finished in 1993. It took more than a decade for BHL to crawl out of the mire.
I was concerned to effect a smooth handover of the company, and Nick Cayzer asked me to stay on for six months to ensure continuity. Many years earlier I had identified Bryan Collins as a future chief executive of Bristows; he’d joined as a ranker and I’d brought him on through the company hierarchy. Nick agreed that Bryan should take over, and Bryan was destined to remain at the helm for ten difficult years.
My son Laurence was director in charge of North Sea operations, and I arranged with Nick that he should be made deputy managing director. As a young man Laurence had run off with the housekeeper and set up a sandwich shop in London, but soon tired of it and asked for a job in the company. Bristows had trained him as a pilot, and at every level he had shown himself to be a very able businessman. He was responsible for the day-to-day operational management of the helicopters on the North Sea. Like all my area managers he had autonomy to operate within capital allowances and contract policies. He was popular with the staff, had a very good grasp of figures and k
nowledge of the cost analysis picture, and maintained excellent relationships with clients. I knew he was perfectly capable of taking over the business. The executive directors agreed with me, but in negotiations I didn’t cover Laurence well enough in writing. Ultimately they contrived to delay his promotion, saying he was too young for the job and would have to wait a year or two. Eventually Laurence got sick of being stalled and announced he was going to set up his own helicopter company in direct opposition to Bristows. Nick Cayzer rang me about it.
‘I think you should discourage him,’ he said. ‘He’s got a service contract with BHL and he can’t do this.’
‘Nick, it’s really nothing to do with me,’ I said. ‘He didn’t tell me about these plans until afterwards, and I’ve got no money invested in his company. He’s very disappointed at being made empty promises. I don’t believe he has a service contract that ties him to BHL. He’s a free agent, and he feels he’s been let down.’
Laurence had not in fact asked me for money. He’d outlined to me the contracts he thought he could take away from BHL and he’d established that he could raise the wind with the banks. ‘My name’s Bristow,’ he said. But I don’t believe he ever really intended to go through with it. He was angry at the company for denying him what he had been promised. When Nick Cayzer found out that Laurence did not in fact have a service contract with BHL he offered to pay him a substantial sum to sign a non-compete contract. Laurence took the money, left the company and used it to set himself up in the property business in Kensington, which returned significant profits.
As to BHL, my own departure was relatively amicable. I called in my shares, and there were no disagreements at all with British & Commonwealth. The disentanglement went smoothly.
While all this was going on, I was heavily involved in a business proposition that was destined to rock the British government to its foundations, cause the resignation of two Cabinet ministers and almost topple Margaret Thatcher. I had decided to take over Westland Helicopters. Thus began what is now known as the ‘Westland Affair’.
CHAPTER 23
The Westland Affair
Millions of words have been written about the ‘Westland Affair’, millions more spoken in committees of inquiry, in parliamentary debates, in Stock Exchange examinations and in the boardrooms of defence companies around the world. But it has never been fully explained. The scandal cost the careers of two Cabinet ministers and almost brought down the Thatcher government, all over the sale of a relatively small helicopter company of which few people had heard, and about which fewer cared. When the dust settled, even some of the people directly involved had little idea what had caused the explosion, and nothing that has happened since has enlightened them.
But I know what it was all about. At the time I was one of the largest shareholders in Westland Helicopters Ltd and was intimately involved in every twist of the plot. Even so, I didn’t begin to find out what was really going on until the deal was done. It was General Alexander Haig who put the last piece of the jigsaw into place for me, over lunch at the Farnborough Air Show.
‘I called in my marker,’ he said. ‘She owed me a debt of honour.’
‘She’, of course, was Prime Minister Margaret Thatcher, whose close control of the process that delivered forty-nine per cent of the equity in Westland into the arms of its American rival Sikorsky baffled everyone who was opposed to it, from her own defence secretary Michael Heseltine on down. The sale was engineered against advice, in the face of a superior offer that was better for Westland and better for Britain, and the shareholders were fed an unremitting diet of nonsense in order to drive it through. Along the way, most of the rules of the Stock Exchange were torn up and thrown in the bin, I was twice offered a knighthood to switch sides, and the reputation of Mrs Thatcher’s government for probity was sullied beyond repair.
The Westland Affair came about because General Haig took personal credit for America’s deployment of AWACS – early warning aircraft – in the South Atlantic during the Falklands War and the real-time provision of their data to the British Armed Forces. In 1982, when he was President Ronald Reagan’s Secretary of State and the Falklands War was gearing up, Haig made a public show of refusing the British the loan of AWACS aircraft in order to maintain America’s ‘honest broker’ neutrality. Years later, when he had returned to his old job at United Technologies, owners of Sikorsky Helicopters, Haig was happy to tell the real story.
‘You guys had a twenty-five to zero kill ratio, Harriers against fast jets,’ he told me at Farnborough in 1986. ‘Some of that was luck, some of it was skill, but mostly it was because of the AWACS information that was being fed directly to your people on the ground, and I was the one who fixed it. It might have turned out different if the Argentinians got the jump on you. I took a lot of risks, politically and diplomatically, and Margaret Thatcher owed me big time.’
When payback time came three years later, Haig said, he called Mrs Thatcher in Downing Street and told her he wanted a forty-nine per cent share in Westland Helicopters Ltd. She must have thought it a small price to pay for such an enormous service, and she told Haig that United Technologies would have what they asked for.
Haig wanted Westland Helicopters to build Sikorsky’s Black Hawk helicopter to sell around the world, and in particular to Saudi Arabia. UTC had visions of jumping aboard the biggest arms deal of all time, the Al Yamamah series which was then being negotiated in the UK, and from which the Americans were excluded. But things didn’t work out according to plan, for anybody.
Westland Helicopters desperately needed new management to give it positive drive and greater productivity. At Bristows, we referred to Westland’s Yeovil headquarters as Sleepy Hollow. The Westland Board was stacked with people who had political or military skills, but little knowledge or experience of industry. The chairman, Lord Aldington, was a lawyer and a Tory grandee. His deputy, Lord Aberconway, was seventy years old and had his hands full as chairman of John Brown Engineering, which was failing badly – ironically, it was being rescued by a ‘company doctor’ called Sir John Cuckney, who was to figure so prominently in the Westland scandal. The managing director, Sir Basil Blackwell, was academically brilliant but very impractical, and when he was elevated to the chairmanship he made a poor job of it. The company depended on the government for military orders and hadn’t the initiative to get up and win outside contracts. Westland were not interested in the civil market. When the Whirlwind was certified for civil use in 1955 it was my company Air Whaling who did all the test-flying, not Westland. Had it been left up to them, the Whirlwind might never have entered civilian service. The patriotic spirit in me very much wanted to buy British helicopters to work on the North Sea, but the Ministry of Supply prevented Westland from acceptingmy order for five Sea Kings. They claimed Westland was working flat out for the Admiralty, and seemed content to maintain the status quo; I had no alternative but to buy Sikorsky 61Ns from America instead.
Nonetheless, over the years I had bought forty-five helicopters from Westland, and I’d become increasingly concerned about deteriorating levels of logistic support. In the late 1970s it became really serious when Jack Woolley came to me to warn me that we might soon have to start grounding the seventeen-strong Wessex fleet. ‘I’m having terrible trouble getting main rotor blades,’ he said. ‘Westland has quoted us thirty-six months for delivery. They say they’ve got military contracts to fulfil.’
I called David Collins, an ex-Vickers apprentice who was one of the few really able people in the Westland hierarchy. ‘David, I’m not waiting three years for blades,’ I said.
‘I’m as frustrated as you are, Alan, but we’re blocked off with military orders,’ he said.
‘I’m going to have to start grounding the Wessex in the next couple of weeks,’ I said. ‘That’s not going to look good for Westland.’
‘I’ll see what can be done,’ he said.
A day or two before we were due to run out of hours on the first Wessex, Westla
nd conjured up three rotor blades – I believe they’d taken them off their own demonstrator. One way and another we struggled through, and eventually we won a life extension up to 3,000 hours on the blades, which improved the outlook. But the episode had brought into sharp focus the issue of Westland’s inability to provide professional back-up to Bristows’ intensive operations.
‘We can’t rely on them,’ I said to Jack. ‘We’ve got to be self-sufficient, as far as possible. We need to overhaul our own gearboxes and rotor heads in-house, and anything else we don’t absolutely have to go to Westland for.’
It took a lot of setting up, but in the end we were doing almost everything ourselves. In addition to gearboxes and rotor heads, Gnome engines were overhauled and BHL performed all the routine airframe maintenance on the Westland helicopters. Main rotor blades aside, most Westland parts were at three to six months’ delivery, although they should have taken a leaf out of Bell’s book. Bell had run a massive component order through its contractors and had set up a warehouse in Amsterdam to service non-American markets. Parts were available for next day delivery. Compared with Bell, Westland seemed sclerotic and uncaring.
