Takeover

by Brian Freemantle

  “What do you imagine to be the share capital required?” asked Morrison.

  “That’s a question for the accountants,” said Rudd. “But from the refitting necessary and the loss-making expectation during the time they’re laid up for refit and then begin operation I would say a minimum of $6,000,000. There will be administration staff to employ immediately and a sales campaign throughout America, which will be expensive.”

  “During our preliminary negotiations there was a suggestion about the names of the vessels,” reminded Buckland.

  To the others around the table Rudd said, “I consider the existing names perfectly satisfactory. Buckland House have agreed their title surrender to us and I consider we should keep them as they are.”

  “Seems a sensible enough idea,” said Faysel.

  “I think it’s got sound, practical value, too,” said Penhardy. “If we’re headquartered in New York presumably the board will meet there?”

  Rudd nodded. “Will that create a difficulty for you?”

  The MP shook his head. “Not at all,” he said. Like Buckland he welcomed the idea of multinational involvement.

  “What about officers?” said Bunch.

  “It’s a matter for discussion, but I thought Herbert Morrison for chairman and Sir Ian Buckland as vice-chairman,” said Rudd.

  Morrison showed no reaction. Buckland smiled broadly.

  “Seems perfectly satisfactory if they’re prepared to accept,” said Faysel, looking enquiringly between the two men.

  “I’d be delighted,” said Buckland at once.

  “All right,” nodded Morrison.

  “The personnel and labour relations departments of Buckland House are negotiating the crew lay-offs,” said Buckland. “That of course doesn’t create any delay in the hand-over.”

  “Have you a date?” said Rudd.

  “Possibly three weeks.”

  Rudd nodded to Bunch. “I think we should bring the senior management across, to make sure everything goes smoothly.”

  Bunch nodded back, making a note.

  “Anyone anything else to raise?” asked Rudd.

  There was a hesitation, then head shakes around the table. As the meeting disbanded, Buckland said, “I’m summoning a special directors’ meeting of Buckland House to settle things after the damned shareholders’ meeting. Day after tomorrow.”

  “Like to see a bit more life in the shares,” said Penhardy.

  The challenge announcement would cause a sell, thought Rudd. In margin purchases the support operation had so far cost him $45,000. In twenty-eight days he would have to settle the remaining ninety per cent, which meant an additional expenditure of $405,000. By then the rest of his broker’s deposit would be exhausted. There would probably be a demand for him to increase his maintenance margin very shortly.

  “They’ll rise,” predicted Buckland.

  Rudd said nothing. After the two Englishmen left the suite, Faysel said, “Why Penhardy?”

  “There might be a good reason later on.”

  “I’m opening the house at Ascot,” said the Arab. “Why not come down? There won’t be much opportunity for any relaxation after the challenge is made.”

  Rudd shook his head. “I don’t think there will be time,” he said.

  Margaret was already in the apartment when he got there. She came to him and put her head against his chest. After he’d kissed her she said, “Christ I’ve missed you!”

  “I was sorry about New York,” he said. “I had to go.”

  She was wearing a checked town suit, open at the neck over a silk shirt, and he thought she looked beautiful. She’d brought fresh flowers and the windows were open, the wind slightly stirring the curtains. She indicated the window and said, “This time I watched you arrive. You walk very fast.”

  “I was in a hurry,” he said. He felt nervous, the uncertainty moving through him. He led her to the couch where he’d asked her to make her mind up the last time, but didn’t sit beside her. Instead he pulled a matching chair around, so that he was facing her. She looked curiously at him.

  “I tried calling the house several times after the meeting. Somebody else always answered. I thought you might have called me,” he said.

  “There were too many people there,” she said. “God, wasn’t the meeting awful!”

  “It could have been worse,” he said.

  She shook her head. “I don’t think so. I’ve told Ian I won’t do anything like that for him ever again.”

  Rudd felt a flicker of hope. “You’ve decided then?”

  “Decided?” She looked away from him.

  “You said after the meeting,” he reminded her.

  “I know.”

  “So what’s the answer?”

  “I’m still frightened, Harry,” she said. “I think I know what I want to do, but I’m terribly frightened. Give me more time, please!”

  Rudd swallowed. “I can’t,” he said.

  She came back to him. “Why not? There’s no hurry.”

  “There is, darling,” he said.

  “You going back to New York already?”

  “Not that.”

  “What then?”

  “Ian didn’t deserve to win the shareholders’ vote.”

  Her shoulders lifted uncertainly. “But he did,” she said.

  Rudd couldn’t hold her eyes. He looked down to where her hands were clasped loosely in her lap and said, “I’m going to challenge him, Margaret.”

  She laughed unsurely. “Challenge him for what?”

  “Buckland House,” said Rudd. “I’m going to court, to get the share structure that gives the family its control declared illegal. And if I win I’m going to make a takeover bid.”

  He forced himself to look at her. She was staring at him, frowning, her head moving slowly in disbelief. “But why?” Her voice was strained and empty.

  “The ship sale and the shareholders’ meeting don’t mean anything, not really. The company is still a mess. It’ll go on failing unless someone does something to stop it happening.”

  “And that’s you!”

  “Yes,” he said. He saw the colour flushing her cheeks.

  “You bastard!” she said. She said it curiously, like someone making a discovery.

  “No,” he said quickly, trying to stop the anger, but she hurried on. “You complete and utter bastard.” She gestured around the apartment. “It’s all been part of it, hasn’t it? The complete takeover, the business and the family and the wife.”

  “Don’t be stupid,” he said. “You know that isn’t so.”

  Her lips were tight between her teeth as she fought for control. “How difficult was it for you to see how unhappy I was!” she demanded. “Is there some psychology involved in all that business crap that’s talked in America? Chapter Five, how to gain advantage from seducing the abandoned wife.”

  “Stop it!” shouted Rudd. “What advantage have I tried to get from what’s happened between us? It happened, that’s all. I’ve told you I love you and I do. That’s why I want everything settled before the court announcement.”

  “So Ian can go knowing he’s already lost his family!”

  “You’re being ridiculous,” said Rudd. “What sort of marriage have you got?”

  Margaret jerked up, unable any longer to remain still. “One that worked, after a fashion.”

  “That’s bullshit and you know it.”

  “I thought I loved you,” she said, her back to him. “I really thought I loved you. I was frightened to death, but I was actually considering becoming the outcast, abandoning everyone and everything.” She turned, hands before her, her knuckles in her mouth. “Christ!” she said. “I can’t believe it!”

  Rudd stood and went towards her but she said “Don’t,” and he stopped. He stood about two yards from her, his arms limp at his side. “You’ve got it wrong,” he said. “All wrong.”

  “I don’t think so.”

  “It’s an excuse,” accused Rudd. �
�You’re using it as an excuse to avoid a decision.”

  “That’s not true!”

  “Stop running, Margaret, Make your mind up.”

  “I have,” she said, moving towards the door. “You can go to hell.”

  Kevin Sinclair was an angular, sharp-jointed man with hair that flopped uncontrolled over his forehead. He sat relaxed, one leg crossed over the other, nodding to Buckland’s gratitude.

  “There but for the Grace of God go us all,” he grinned. “I didn’t consider it was too much for you to ask.”

  “I appreciate it all the same,” said Buckland. “I’m going to restructure the board: I’d like you to come off the subsidiary group and sit with me on the holding company. We’ve just taken on the American, Rudd. We’re really going to be multinational.”

  “I’d like that,” said Sinclair. “I’d like that very much indeed.”

  There had been communication between them in the past, before the request to act as nominee for Morrison, but Gene Grearson had never met the solicitor who acted as his London agent, on the reciprocal agreement for use of Grearson’s facilities in Boston. Peter Coppell was exactly what he imagined an English lawyer to be, neatly suited, neatly barbered and precise to the point of being pedantic.

  Coppell frowned as Grearson relayed Morrison’s instructions and said, “Are you sure the man knows what he’s doing?”

  “Completely,” assured the American.

  “At the shareholders’ meeting I was in the minority of nominee holders, in favour of Buckland. This reversal will mean exactly the same thing; surely Morrison would benefit from supporting the takeover. He’s voting against himself!”

  “I know,” agreed Grearson. “I’ve talked it through most fully with him: those are his instructions.”

  “Most unusual!” said Coppell.

  “It was originally his company,” said Grearson. “He insists that to oppose the takeover would be in its best interests.”

  Coppell shook his head but decided against continuing the opposition. “How long will you be staying in London, Mr Grearson?”

  “Only a few days,” said the American. “Having come this far I’ve decided to extend the visit into a vacation and go on to Europe.”

  Margaret sat hunched in her bedroom, the door locked, arms tight around her body as if she were cold. The immediate, instinctive anger had gone now and she didn’t know how she felt. Betrayed, certainly. Relieved, too. The realization surprised her. Had he been right, about her snatching for an excuse? She thought she loved him; even after what he’d said today, she thought she loved him. But enough to throw up the security of everything she knew?

  29

  John Snaith was the last to arrive and as the merchant banker took his place at the boardroom table Rudd had a sensation of déjà vu; Snaith must feel as he had felt, all those years ago, entering for the first time the Best Rest boardroom which had then been on Boston’s Atlantic Avenue, knowing that some people in the room hated him and everyone else held him in suspicion. He’d had to endure it for a long time, remembered Rudd. It was going to be much briefer for Snaith.

  Rudd thought that the merchant banker and Smallwood were confronting the hostility well, refusing to turn away from the looks that were being directed at them from Buckland’s side of the table.

  Buckland was very sure of himself, enjoying the confrontation. The opening procedures weren’t hurried and when they ended Buckland allowed a gap before he spoke.

  “There is only one subject for discussion today,” he said. “It is into the conduct and behaviour of our merchant bankers and their representative and supporters. What was done and the effect of that action upon this company is well enough known to everyone here for it not to be necessary for me to repeat it in detail. I think it is sufficient to say that at this morning’s valuation, something like £2,200,000 has been taken off the company’s value, through the lack of confidence created entirely by what they did.” He paused, then continued. “Despite our share loss, you are all aware that our liquidity problem has been resolved as the result of our negotiations and link-up with Best Rest. I wish formally to recommend to this meeting the sacking of Samuel Haffaford and Go. as merchant bankers for Buckland House, and for this company to switch its financing to another institution.”

  “Second the proposition,” said Lord Condway at once.

  Snaith fought back immediately. He said, “The action of myself and my bank was motivated entirely by the feelings expressed to you and the vice-chairman when you made your visit seeking overdraft extensions. It was to save this company …”

  “… by personal, unwarranted attack!” cut in Gore-Pelham.

  Snaith considered his words before resuming. “The conduct of the shareholders’ meeting was very clever,” he said quietly. “My company and myself were completely outmanoeuvred. But that is what it is, a manoeuvre. I have no intention of repeating any allegations here this morning. You are aware of them and I invite you all, in proper honesty, to draw your own conclusions from them.”

  “The point has been made and should be made again that selling off a division to settle an existing debt doesn’t solve our difficulties,” said Smallwood, in his high voice. “In another year, eighteen months, we’ll be back where we were earlier this year, going into deep deficit.”

  “I don’t think what happens to this company in a year should be a matter of concern for either you or Mr Snaith,” said Penhardy.

  “You’ve already spoken of confidence,” said Snaith. “What sort of confidence do you imagine will come from a boardroom upheaval and the disposal of your existing bankers?”

  “Isn’t it a little late for you to be concerned on behalf of the people whose money you’ve invested and then jeopardized?” said Penhardy.

  “Nothing is too late if this board puts itself in order and begins properly to run its business,” said Snaith, with sudden force.

  “Putting this board in order is the purpose of this meeting,” said Buckland.

  “If this board were to move the expulsion or seek the resignation of Snaith, then I would have immediately to offer my resignation also,” said Smallwood.

  “That would have to be entirely a decision for you,” said Buckland contentedly.

  If his court action and takeover were successful, Snaith and Smallwood were exactly the sort of professionals he would want to remain upon the board, recognized Rudd. So he had to declare himself in advance of any vote. He cleared his throat and said, “There’s an announcement I’d like to make to this board.”

  Buckland smiled towards him.

  Rudd hesitated. Then, talking directly to Buckland, he said, “Tomorrow there are being served upon the members of the Buckland family and officially upon this company, writs alleging that under the Companies Acts and regulations empowered by the Registrar of Companies the Initial shareholding formation is unjust and unfair.”

  The stunned silence was absolute. Then the outrage gushed from Buckland. “WHAT!” he said.

  “I am instituting legal action against your family control of the company,” said Rudd, more simply.

  “BASTARD!” shouted Buckland.

  It was becoming a common accusation against him, thought Rudd.

  Within two hours of the court action being announced publicly, the institutions and fund managers who had hesitated after the shareholders’ meeting began to offload. Rudd’s initial mop-up commitment was quickly exhausted and brokers asked him to increase his maintenance margins, to continue the purchases at 95p a share. The intervening weekend did nothing to dampen the fever. Rudd withdrew his buy orders when he reached a limit of $2,000,000. Without the automatic barrier, the slide became an avalanche. On Tuesday they opened at 60p and by midday were being marked at 45p. It was then that the Stock Exchange Council suspended dealings, for a nominal period to allow trading to calm. The action increased the pressure upon Buckland. His lawyers sought the postponement that Rudd’s advisers had predicted, but the judge sitting in cham
bers agreed the hearing was urgent in view of the suspension and dismissed the application. There was no suspension on the New York exchange, and Best Rest suffered by its association. In a week, the stock value plunged by $6,500,000. There were daily meetings between Rudd and Sir Henry Dray and then again between Rudd, Bunch, Faysel and Morrison in the Grosvenor Square apartment. Bunch and Morrison moved from the Berridge into the Connaught and Faysel commuted daily from Ascot. The media coverage was more intense than before, squads of reporters, photographers and television men camped almost permanently in Grosvenor Square and attempting to follow Rudd wherever he went. He supposed it was the same with the Buckland family. Several times, usually late in the evening when he was alone in the apartment, Rudd stared at the telephone, dismissed the idea as ridiculous but still considered calling Margaret; once he even lifted the receiver and held it growling in his hand for several moments before replacing it again.

  At the final session with Dray, the day before the court hearing, the lawyer said, “I expected interest but I never imagined it would become quite the cause célèbre.”

  “No,” said Rudd.

  “Would you have initiated it, if you’d thought it was going to turn out like this?”

  Rudd considered the question. Then he said, “No. I don’t think I would.”

  “Too late now for second thoughts,” said Dray briskly.

  “Yes,” said Rudd. Would it be for Margaret? When the case was over she wouldn’t be able to use it as an excuse. And he was convinced that was what she had done.”

  Peter Coppell delayed until the last permitted day before complying with the court’s request, trying first by telex and cable and latterly by telephone to contact Gene Grearson in Boston to advise him, but the American had not returned from his European vacation and had not left forwarding addresses. He’d made every effort, Coppell decided. And it amounted to little more than a formality anyway.

  “We just made it,” reported the clerk, returning from the High Court.

  “Damned strange business,” said Coppell. “Altogether a damned strange business.”