But Matthew and Ed had done a mountain of research.
The research told them that things weren’t as bad as they seemed. New cleaned-up accounts due in October promised to show the company had recovered further than anyone had thought possible. Already they reckoned their twenty million pound stake was worth twenty-five million. They were confidently expecting to sell out for thirty by the end of the year.
And, just as the group had grown in its confidence, Matthew had grown in his. He had his account with James Belial at Switzerland International. He was ready, mentally and emotionally. At long last, Plan B could begin.
First, though, Fiona, Ed, and Matthew needed to finalise a decision of their own.
‘OK,’ said Fiona. ‘Cobra Electronics. We’ve done the research. We’ve discussed it for hours. We think that the market has, if anything, improved. Are we ready to go ahead?’
Cobra Electronics was a defence company which had invested too much in a new missile. The missile looked great but it didn’t work. The company wasn’t too sure what was wrong. It hadn’t even come up with an estimate of how long or how much it would take to fix the problem. Meanwhile, the company had lost a few important contracts, and its future looked perilous. Bankers and investors were running for cover.
Ed Deane went first in answer to Fiona’s question.
‘Yes. There’s nothing new on Cobra itself, but over the last few weeks I’ve noticed that the decisions on three important missile contracts have been deferred. Saudi, Indonesia, and Malaysia, to be exact. Most people have taken that as bad news for Cobra, but actually I think it’s good. People had been expecting Cobra to lose anyway. If the decisions have been deferred, then maybe Cobra has some good news that the missile buyers are taking time to evaluate. There could be a great surprise around the comer, and even if there isn’t, it’s no worse than we’re expecting anyway.’
Fiona nodded.
‘Good. Matthew, how’s the loan market?’
She looked into his eyes. There was nothing but cool professionalism in hers, nor would she see anything else in his. Romance has no place on the trading floor, but out of the office their relationship went from strength to strength. They were in love.
‘Good news,’ said Matthew. ‘The price of the loans has been falling. Cobra is asking its banks for more money. In effect, it’s saying “If you don’t give us more cash now, then everything you’ve lent is going down the pan”. The banks don’t really believe that, but there’s no organised resistance. So the company will probably get the extra cash and the banks are nervous. Given everything, I think we’d be able to buy thirty or forty million pounds’ worth of the company’s loans at forty pence in the pound.’
‘Excellent,’ said Fiona. ‘I say let’s do it. Right?’ Matthew and Ed nodded. This was the biggest deal they had yet attempted and the boldest too. Fiona wanted to buy ten percent of the company’s loans. Once they had that, they would have a blocking vote over anything the company wanted to do. Cobra Electronics was in for a shock.
‘Yes, let’s do it,’ said Matthew hoarsely. ‘I’ll go get some cappuccinos, and we’ll get started.’
The others agreed with pleasure. The Blue Mountain Coffee Boutique coffees were from heaven, just the way to start a raid. Matthew put on his coat and left the office.
In his coat pocket were two mobile phones. One belonged to Madison. Its number was in the bank’s internal phone directory and anyone could reach him on it. The other phone was Matthew’s own property. Only one person knew he had it, and that person lived in Switzerland and was very keen on keeping secrets.
On his way to the coffee shop, Matthew ducked up a side alley, away from the noise of the street and the passing crowds. The alley led up to a small garden, surrounded by offices on three sides and a pub on the fourth. This early in the day, the pub was closed and the benches standing beneath an elderly fig tree were empty. Matthew sat on a bench, his back to the tree, pulled out his phone and dialled.
James Belial answered the phone. Matthew imagined the ugly little man moistening his lips as he said smoothly, ‘James Belial, at your service.’
‘James, it’s Matthew Gradley. I’ve a trade I’d like you to execute.’
Matthew described it briefly. He wanted to buy bonds in Cobra Electronics. He wanted to invest everything he had - his bonus, plus any accumulated interest. He wanted the trade done instantly.
‘If you wish,’ said Belial. ‘But you do understand, don’t you, that this is a risky situation? You’re buying into a company widely seen to be on the brink of disaster and you’re investing everything you have.’
‘I understand. I’ve evaluated the risks.’
‘I’m sure you have. We’ll be delighted to execute this trade on your behalf. Would you like me to mail you a confirmation slip? I could fax something through to you at work, if you’d like it immediately?’
‘No. Absolutely not. I’ll call you later on for the information. Don’t ever fax anything to me at work. Don’t even call me. I’ll call you.’
‘Ha, ha! Of course, of course. Madison can be very oldfashioned at times. Better to keep these things discreet. Mum’s the word.’
Matthew rang off. It was difficult to like Belial.
4
Darren hung around Sawley Bridge for a while, living with his mother. It was common knowledge what had happened, and village opinion was generally behind him. People thought that he’d behaved like an idiot, but that George had gone too far in dismissing him. It wasn’t as though George had been much of a disciplinarian before.
Darren was in the pub pretty much every night, where his former workmates never allowed him to pay for a drink. He made the most of the free beer, developed his pool game to new heights and never got out of bed before midday. He was endlessly bitter about George’s treatment of him, and grumbled to anyone who would listen.
Eventually, the joys of free beer and endless pool wore off. Darren rowed with his mum one afternoon. He got drunker than usual in the pub that night and became unusually argumentative and belligerent. He told the landlord that he was off to ‘get even’ with George, and stumbled out into the night. The landlord was concerned enough to call George in Ilkley, who thanked him and promised to be on the lookout for trouble. As it was, Darren didn’t show up at George’s lodgings, though Darren’s mum said he wasn’t home until gone four in the morning. When he got up the next day with a temper as bad as his hangover, he stuffed some clothes into a backpack, and left.
Darren’s mum thought he was off to stay with a friend in Skipton, but wasn’t sure. At twenty-two, he was old enough to look after himself. The news reached Gissings as the factory began to close up for the day, and was met with a general sense of relief. Although his workmates were sympathetic, Darren’s incessant moaning had become hard to take. ‘He’ll be alright,’ said Dave. ‘At least he’s getting on with his life.’
Dave might not have been so philosophical had he known where Darren actually headed. He didn’t go to Skipton. In fact, he hitched a lift south with a lorry driver heading into Bradford. From Bradford, he caught a ride south on the A641, then hitched a ride into Halifax, and left on the A646 heading west towards Burnley. By seven in the evening, he had reached the outskirts of Stirby. It would be dark in an hour and the weather was rainy with a gathering wind behind it. Darren had forgotten to pack any rain gear when he left, and he shivered inside his denim jacket.
The van driver who had given him a lift dropped him at a petrol station just outside town. Darren waited until the driver had set off again, then started to walk the half mile north-east to the town’s industrial estate. There were other firms on the estate, but one company dominated. As the sign at the gateway put it: ‘Asperton Holdings Ltd - Quality Furniture Nationwide’.
Darren found the Asperton car-park, now mostly empty. Among the few cars present was a black 5-series Mercedes with a recent registration plate. Darren dropped his backpack on the wet tarmac by the car’s boot and sat on
it, his back against the rear bumper. He dug some headphones out of the side pocket of his pack, but the drawstring hadn’t been pulled tight and the Walkman itself was missing. He swore and threw the headphones away. He did manage, however, to light a damp cigarette with some damp matches and puffed away and waited. He’d only started to smoke tobacco since getting the sack.
‘No smoke without a firing,’ he said.
Time passed. Darren got wetter, and colder. He chainsmoked his remaining cigarettes, because the matches were now too wet to use. The wind blew harder, whipping up spray from the growing puddles.
Eventually, the neon lamp at the car-park entrance betrayed two figures, walking hurriedly. Bundled in wads of cashmere and hunched beneath a pair of wind blown umbrellas, the couple approached the Mercedes. When they were close, Darren called to them.
‘Hi there.’
The pair halted, alarmed. The slightly less short of the two figures bustled about for a while in the depths of his coat, while the shorter figure, a woman, tried to hold his brolly for him in the snatching wind, scolding him for his tardiness. Eventually, the man found the torch he had been searching for and pointed it at Darren.
‘Who are you? And what do you want?’ asked Mike Asperton.
‘I’m Darren. I used to work at Gissings, but I don’t work there any more. I was wondering whether there might be anything on offer around here.’
Darren gestured around the car-park with his cigarette. He was still sitting on his pack, with his back against the car.
‘Well, I’m not sure if there’s anything suitable. But you need to apply in writing, we can’t just give you a job here and now.’
The Aspertons weren’t sure whether Darren was harmless or not. For the moment, they would treat him with care. They stood their distance and continued to prod the torch beam into his eyes.
‘Well, it’s not quite like that,’ said Darren. ‘I wanted to speak with you, you see.’
Eileen Asperton took the torch from her husband’s hand. She approached closer, using the torch as a shield, while the wind tugged and snatched at her umbrella.
‘There’s nothing you can say to us that can’t be said better in writing, young man. You have no business to be in this car-park. Now, please move aside.’ She flicked the torch beam away into the night to show him what she meant. Then the light moved back, full square on Darren’s face.
Darren didn’t move. He dragged on the last of his cigarette, burning the tobacco right down to the filter. He dropped the butt on the ground, where it was immediately extinguished in the rain.
‘Well, you see, what I was going to say was, I used to be George Gradley’s golden boy. There’s nothing that went on at Gissings that I didn’t know about. I thought it was better to come and see you personally, if you know what I mean. Sorry about scaring you and everything, but I thought I wouldn’t get to see you if I just came and banged on the front door.’
The Aspertons didn’t move, but their posture subtly changed. They weren’t scared any more, just interested. Mike Asperton made a sudden gesture of recognition.
‘You were one of the lads who carne to buy some of our Brilliants, weren’t you?’ He started to explain to his wife, who cut him short.
‘Why did you leave Gissings, if you were so close to Gradley?’ she asked.
‘He caught me taking the mick and he fired me. Without even a thank-you after all I’d done.’ Darren spat, something at which he excelled.
‘What did you come here to tell us?’ asked Eileen Asperton. ‘You didn’t just come to ask for a job.’
‘Well, Gissings ain’t as bleeding holy as it makes out,’ said Darren. ‘They get up to stuff, just like everybody. Difference is, I know what stuff.’
‘Unsubstantiated allegations are of no interest to us. If that’s all you’ve come about, you may as well leave right now.’
But she wasn’t dismissing him. She was waiting. Darren patted his backpack.
‘I’ve got everything in here. Everything you could want. Copies, not originals, so they don’t even know they’re missing.’ Both Aspertons stared greedily at the filthy pack. ‘And you don’t need to worry, cos I’ve put them in a plastic bag, so they won’t even be wet. Unlike me,’ he added, hinting.
Muffled in their cashmere coats and scarves and hats, and bobbing gently beneath their tugging umbrellas, the two proprietors of Asperton Holdings stood and drooled. Eileen Asperton dropped the torch beam away from Darren’s face on to the ground, then from the ground to the shiny black car.
‘You’d better climb in,’ she said.
5
1’ll go get the celebration coffees,’ said Matthew.
‘Champagne, more like,’ said Fiona. But she was joking, of course. This was Madison. Alcohol was no more acceptable than trading losses. Coffees it would be.
They had plenty to celebrate. They had successfully bought eleven and a half percent of all outstanding bank loans to Cobra Electronics at an average cost of forty three pence in the pound. Last week, they had issued a press release announcing the size of their holding. They also mentioned their intention to block the company’s proposed refinancing plan.
There followed a week of frenzy. Cobra’s first response was not far short of hysterical. It accused Madison of being a ‘self-centred American bank with no understanding of the complexities of the industry’. It said that if Madison blocked the refinancing, the company might go bankrupt ‘by year end’. It called all of its other banks in a rush of indignation, only to discover that they were all quietly delighted at Madison’s leadership.
Cobra called on its merchant bankers, who broke the truth. The company didn’t need more money; it needed competent management. The quickest way to get it was to dismember the company and sell the pieces to the highest bidder. The management resisted, but not for long. With Madison preventing new money from coming in, the company had no choice. A fortnight after Madison had issued its press release, Cobra issued its own, announcing that the company was putting itself up for sale.
The stock price exploded into life, doubling on the first day, then doubling again over the next three days. The price of the loans also rocketed, giving Madison a paper profit of near enough seventy percent. Brian McAllister was ecstatic. He got an e-mail from Dan Kramer congratulating him, and he passed the note on to each of Fiona, Matthew and Ed. Fiona had a dozen picture nails banged into her office wall. She framed the note from Dan Kramer and hung it from one of the hooks. The other eleven stayed empty. This group was going to stay hungry.
Matthew put his coat on.
‘Cappuccino for you, Ed?’ he called to Ed Deane, who was fussing over his bonsai forest.
‘Coffee? Yeah, OK, whatever. But can you go by the florist’s and pick up some plant food? My apple’s developing a blemish. I think it’s magnesium deficiency.’
Deane pointed out a minute black speck on the last of his prized apples. The speck looked suspiciously like dirt to Matthew, who didn’t know too much about magnesium deficiencies. He poked the speck with his finger and it moved. Deane wiped it away with a soft cloth he kept ready.
‘I’ll go by the opticians, if you want,’ said Matthew, but his joke was lost on Deane, who was spraying distilled water on the apple in his relief.
On the way to the coffee shop, Matthew ducked into the little side alley that led up to the garden and the pub. The square was quiet again. The only people there were a couple of tourists trying to find an obscure Christopher Wren church. They asked Matthew’s assistance but he couldn’t help. They left. Matthew pulled out his phone and dialled.
‘Matthew! How nice to hear from you,’ said Belial, once he knew it was Matthew. ‘I had a funny feeling you were going to call.’
‘Yeah,’ said Matthew, who didn’t enjoy Belial’s innuendoes. ‘I want to sell out of my position in Cobra Electronics. Completely.’
Belial said it would take a few minutes but that Matthew could call back to find out exactly how well he had d
one. Matthew agreed and went off to get the coffees. Once back in the little square again, he called Belial.
‘Congratulations. We’ve sold everything. You’ve made a seventy-two percent profit on the deal, after commissions and everything. Your balance with us is now £109,000 sterling. I must say, you did strike lucky. Just imagine Madison marching in the very same morning you made your investment with us! I bet you were pleased.’
Matthew rang off. He could just imagine the tidy little man, his ugly little face screwed up in laughter. He was unpleasant, but useful.
Matthew went back to the bank, coffee in his hand and joy triumphant in his heart. Plan B was rolling into action.
With Cobra, he had done particularly well, because of the company’s vulnerability and the way Madison had been able to take advantage of it. But even when Madison was just buying on the basis of long-term research, Matthew could profit. The market for company loans and bonds is very thin. Big trades will push the price up or down by a long way and almost overnight. Just knowing that Madison was going to make a trade was information that Matthew could profit from. Even if prices moved by just ten percent, he could make an overnight profit of ten thousand pounds. Even five percent was a huge move - as long as it happened overnight, and as long as, like Matthew, you knew which night was the night. And each time his capital increased, his scope for profits increased too. He’d do it. He now really believed, perhaps for the first time, that he’d do it. He’d get his father’s millions.
But in amongst the joy, there was also shame. Insider trading is deeply illegal. It carries a maximum of seven years in jail. Everyone who respected him at Madison would despise him if he were caught. And, above all, if she knew, Fiona would never speak to him again. She mustn’t know.
He got back to his desk. Fiona and Ed were somewhere else, in a meeting probably.
The Money Makers Page 36
