Takeover

by Brian Freemantle

  Snaith and Smallwood were frowning now and Condway had his head twisted, looking up at the chairman.

  “I would like you today to understand that this recognition was reached before the court decision.…” said Buckland. He nodded in Rudd’s direction. “The court hearing was begun at the instigation of our newest director against whom I feel no personal animosity. During the hearing, he made it clear that his purpose in bringing the action was the improvement of this business. That I believe. He also made it clear that if he were successful, then he would be making a takeover bid on behalf of his American company.…”

  The ballroom was completely quiet now, everyone conscious that he was about to say something of importance.

  “I further believe,” said Buckland, “that this takeover would be in the best interests of Buckland House.”

  The noise began, first from the hall and then along the table. Rudd heard Snaith shout, “A point of order.…” before being drowned by the renewed hammering of Buckland’s gavel. “Everyone will have the opportunity to speak,” shouted Buckland. “First give me the opportunity to finish. It is because I seek first and foremost the best interests of Buckland House that my family and myself have already disposed of the shares judged to represent an unfair holding. The Buckland family has already signed legal undertakings under which fifteen per cent of its Initial holdings have been purchased by Mr Rudd, Prince Faysel and by Best Rest.…”

  “Trickery!” shouted Snaith, bursting to his feet. “This is trickery, against the interests of shareholders and I will not be silenced!”

  Buckland hesitated, moved the microphone along the table and said, “I give the floor to Mr Snaith.”

  The merchant banker snatched at the microphone. His other hand was opening and closing in tiny snatching movements at his side. “Today’s share quotation is 70p,” he said. “It has been driven that low because of the lack of confidence in the governing of this company by a man whose character and behaviour have regaled and titillated every newspaper reader in the world in recent weeks. Sir Ian talks about responsibility and having the best interests of Buckland House at heart. The only interests he has at heart are his own. We have yet to hear the financial details of the American offer, but in anticipation of that offer my bank have carried out a revaluation of Buckland House’s London holdings. At today’s prices, the five hotels are worth £57,000,000. I demand on behalf of the shareholders to know what price Rudd is offering.”

  Rudd rose, moving the microphone at his end of the table nearer to him. “I am delighted to make clear what I am offering,” he said. “Buckland House is the best and most prestigious hotel chain in the world. I am offering to keep it so.”

  “Answer the question!” shouted Snaith.

  “The accusation is of trickery,” said Rudd. “Yet you are glibly asked to consider only one division of Buckland House, at £57,000,000, when considering whatever offer I might make. Trickery.…” he repeated. “Yet no mention is made of the predominant reason why today’s valuation is 70p a share. It is not because of a recent court action. It is because of decisions now being made in Lusaka, decisions from which it seems likely that Buckland House will lose eight of its properties. My offer will be for Buckland House worldwide, not piecemeal. And it will include the African holdings, which may or may not be retained. If there is trickery here, then it is in putting forward an inflated figure for England and asking you to multiply it by the worldwide divisions, which is not applicable.”

  “A figure,” Snaith called out. “Give us a figure!”

  “I am prepared to offer 60p Ordinary, 140p Preferential and £10 for the Initial holdings,” announced Rudd.

  “Ridiculous,” said Snaith at once. He grabbed the microphone. “That is at least a third below what it should be,” he said urgently. “It’s ludicrous.”

  “It is double today’s valuation,” said Buckland, rising. “From the chair I urge you to accept.”

  “I am not satisfied with the legality of the share disposal,” said Snaith, with renewed urgency. “We have been assured that the court’s ruling has been complied with, but no proof has been produced. And even if there were proof, then it seems to me that the power has not been distributed to the benefit of everyone, but juggled sideways to maintain the monopoly that has always existed. I propose a postponement of this meeting so that what has happened can properly be examined by independent legal experts.”

  Rudd had expected the support to come automatically from Smallwood but instead it was Condway who took the microphone. “I second,” he said. “I do not think we can proceed with takeover discussions until this other matter has been satisfactorily concluded.”

  Rudd saw the divisions were being decided. Condway had come down on the side of city respectability. Which left Penhardy and Gore-Pelham. And a lot more besides.

  “Proof is obviously and clearly available,” said Buckland. “Share certificates are being obviously reassigned, which is why they cannot be produced here today. But I give my word of honour that there has been a fifteen per cent dispersal. This postponement request is a pointless, delaying tactic, the only result of which will be further damage to our share stability and inevitably damage to you, the shareholders.”

  “Why the hurry?” demanded Smallwood, coming to the microphone for the first time.

  “For the stability!” said Buckland, exasperated. “We’re being quoted at 70p per share, for God’s sake!”

  Snaith had been making a calculation in one of his inevitable notebooks. “An offer of 140p a share values the London properties at £34,000,000,” he said. “That cannot be accepted.”

  “Now who’s resorting to trickery!” demanded Rudd. “There is no conceivable way you can make a calculation like that. My offer is worldwide, not restricted to England.”

  Gore-Pelham finally got to his feet. “I agree that there should be a postponement of this meeting,” he said.

  Rudd stared along the table towards Penhardy, the only director yet to declare himself. The MP had his head bent over the table, looking at some scribbled notes on some papers before him. He made no move towards the microphone.

  The seating arrangements were the same as they had been at the earlier meeting and from the investment fund section a man rose and said, “If the African properties are nationalized, what is the potential loss to this company?”

  Buckland responded eagerly to the question, prepared for it. “The last valuation in Africa was carried out three years ago,” he said. “Upon that valuation the cost would be a minimum of £24,000,000.”

  Another fund manager rose, addressing himself to Rudd. “Do you guarantee that your offer includes those properties? That you won’t seek a reduction in share pricing if there is a takeover?”

  “A firm and absolute guarantee,” said Rudd. He turned along the table. “I invite a similar undertaking from anyone whom Mr Snaith’s bank might be representing.”

  “I have said nothing about us representing counter-bidders,” said Snaith.

  “Aren’t you?” demanded Rudd.

  The exchange caught Snaith wrong-footed. He looked down to Smallwood as if expecting help from the finance director and then said, “It is possible that there might be other interests.”

  “Which have not been declared to this meeting!” said Rudd triumphantly.

  The fund manager who had spoken first from the hall rose again and said, “If we lose the African properties, then 140p a share is a good offer.”

  “But not if we don’t,” said Condway.

  It was time for pressure, Rudd decided. “I have given the guarantee,” he said. “But it cannot be an open-ended one. I am restricting the tender to two weeks.”

  “An ultimatum,” shouted someone from the hall.

  “No,” rejected Rudd at once. “Enough damage has been done to Buckland House. As the chairman has already said, the urgency now is for stability.”

  “Postponement motion to the vote,” urged Snaith.

 
Buckland looked into the hall, inviting further comment, and when none came he moved the motion. The stewards who had maintained the privacy of the meeting acted as tellers, moving along from row to row. The voting took several minutes. Margaret and Vanessa were twisted in their seats, trying to get some assessment.

  “Directors to vote,” said Buckland.

  Rudd was concentrating entirely upon Penhardy. The MP looked to his right for the in favour indication from Condway, Gore-Pelham, Snaith and Smallwood. He kept his hands firmly upon the table.

  “Against?” said Buckland.

  The directors’ division was evenly split. Buckland passed the figures along to Snaith’s end of the table, for the banker to see them first and then rose. He said, “The postponement motion has been lost, by 2800 votes to 1800. I repeat from the chair what I said earlier: I recommend acceptance of the Best Rest offer of 140p a share.”

  Snaith was already on his feet. “I intend that the disposal be questioned, before a court. I give notice that we will seek to declare invalid the agreement reached between the Buckland family and certain directors.”

  “Damn the man!” said Rudd quietly to Faysel.

  “It was predictable,” said the Arab.

  “I still hoped they wouldn’t think of it,” said Rudd.

  Walter Bunch listened patiently while Rudd gave a detailed account of the shareholders’ meeting and then said. “You were wrong, setting the tender limit. All Haffaford’s have got to do now is stall us beyond two weeks.”

  Rudd shook his head. “After then we’d have lost anyway. We can’t hope the shares to stay down beyond two weeks, certainly not now that the counter-bid is public knowledge.”

  “There’s Africa,” said Faysel. “Only we know that’s not a threat.”

  “People will be ready to gamble if it doesn’t happen immediately,” said Rudd. He turned to Penhardy. “What about the Monopolies Commission?”

  “I’m pretty sure we’re all right, unless Condway and Snaith start building up too much pressure,” said the MP. “It’s a two-edged sword and they realized it; we can make the same demand, against whatever hotel chain they bring in to make the other offer. But if we’re not careful there’s going to be Parliamentary discussion about the whole thing. It’s bloody messy.”

  Hallett came hurriedly into the apartment from the Connaught, his face more flushed than usual. “I thought you’d want to see this right away,” he said, offering Rudd the telex slip.

  It was a long message and Rudd stayed bent over it for several minutes. Then he looked back up to the other men in the room and said, “I’m summoned home to explain myself before the shareholders a week from today.”

  “It won’t be over by then,” said Faysel.

  “It might,” said Rudd.

  Hallett stood expectantly, waiting for him to continue, but Rudd said nothing.

  “It would have been a bad tactic to talk about the Best Rest problems in front of Penhardy,” said Rudd. “I’m still not sure of him and it would have defeated us if he’d leaked it back to Haffaford as an entry bargain for joining them.”

  Only Bunch and Hallett remained in the apartment now. The lawyer said, “What’s it matter? Morrison and Walker and the others have castrated you.” He picked up the message, looking at the section that Rudd had not read out earlier. “How can you make a takeover when they make it quite clear they won’t honour the cheques you issue? You can’t even take up what the Buckland family is releasing to you in the company name.”

  “I won’t buy them in the company name,” said Rudd. “I’ll make it a personal purchase.”

  “You’ve already spent something like $3,500,000,” reminded Hallett. “You’re committed to $2,000,000, on what was going to be personal holding anyway. You’ll need another $3,000,000 for the company apportionment.”

  “Which leaves me with $500,000 liquidity,” said Rudd.

  “But what about the shares that are going to come on offer!” demanded Bunch. “You’ve committed Best Rest to 140p. It’s illegal to make an offer you can’t meet.”

  “What’s the value of my stock portfolio in Best Rest?” Rudd asked Hallett.

  “Ten million,” said the personal assistant, at once.

  “Borrow on it,” said Rudd at once. “Anything offered can be bought on margin, so I’ll have twenty-eight days to settle.”

  “And what happens if you haven’t made it in a month?” said Bunch. “You’ll be arrested for fraud and won’t have sufficient money left to brief a lawyer! Cut out, Harry, for God’s sake. Let’s write it off as an expensive mistake and go back to America, where we belong.”

  There had never been an expensive mistake before, thought Rudd. There wasn’t going to be this time. “No,” he said. If he went back, Margaret would know he’d failed.

  Rudd recognized her voice immediately and at once a numbness went through him, a physical sensation. The telephone felt slippery and insecure in his hand.

  “You said you wanted to see me,” said Margaret.

  “Do you want to see me?”

  “Yes,” she said.

  “When?”

  “After Thursday.”

  “Why wait until then?”

  “I want everything settled.”

  “You’ve made your decision then?”

  There was a long hesitation from the other end. Then she said, “Yes.”

  Margaret replaced the telephone, seized with a sudden feeling of claustrophobia. She hurried from the house to the stables, saddled her horse and took it, too fast for safety, across the cobbles and out into the grounds. She reined back, embarrassed: she rode without any intentional direction and then recognized the hill, the high spot she usually went to, for its view. She stopped at the summit: beneath her the horse snorted and pawed, grateful for the rest. Margaret gazed around, first at the large house, then the smaller one, letting her eyes travel to the lake and the deer forest. Enduring, she thought: unchanging and safe. Beneath her the horse shifted, breaking her mood. She couldn’t delay any longer her return to London. The sensation wasn’t claustrophobia now. She felt sick.

  38

  Haffaford’s issued a statement of their intention to challenge the share dispersal and their later hope of introducing a counter-bid to top that of Best Rest, and there was wide publicity in America. Herbert Morrison read it in the Wall Street Journal, coupled with the press release that Buckland House had produced urging their shareholders to accept the bid that had come from Rudd. The burly man put aside the newspaper and looked across the lounge of the businessmen’s club, waiting for Walker to arrive. He’d won, Morrison decided. It had been far more costly than he had anticipated and the damage to Best Rest had been greater, but he’d won. There was no way Rudd could survive the stockholders’ meeting. Morrison decided to move their withdrawal from the Buckland House negotiations at the same time. That might depress Buckland House but it would mean an immediate rise in Best Rest. Morrison calculated the recovery would take a long time, maybe even a year, but eventually they’d regain their parity. It would be quicker with Buckland House. Once they had withdrawn and the alternative bid was declared, the prices were bound to go up. And if Haffaford’s clients were putting it higher than Rudd, then it would mean recovery of the personal fortune that had been so badly eroded.

  Morrison saw his partner enter and waved to attract his attention. Walker crossed the lounge, gesturing to a waiter as he did so for his usual drink. It arrived at the same time as he did.

  “You’ve seen it?” said the Best Rest vice-chairman, indicating the discarded newspaper.

  Morrison nodded. “What’s happened to the market?”

  “We’re down another two points at the threat of a fight.”

  “Thank God we’re getting out,” said Morrison. “I’m going to propose withdrawal at the stockholders’ meeting.”

  “If you hadn’t, I would have done,” said Walker. He sipped the Bushmills. “I called New York,” he said. “There’s been an a
cknowledgement from London.”

  “Saying what?”

  “Nothing: just the acknowledgement of the meeting.”

  “There’s not much he could say, is there?” said Morrison.

  “We’re going to go down further,” predicted Walker. “Pulling out of the takeover might balance it a little, but getting rid of Rudd as chairman is going to cause some nervousness. He was pretty well known, with a good track record. People had come to trust him.”

  “Not any more,” said Morrison. “Whatever we drop will pick up soon enough.”

  “How do you feel about a change of title, Herb?”

  “Change of title?”

  “Chairman instead of president. I think you should be back in control.”

  Morrison looked modestly down into his lap. “There’s a lot of work to be done, to recover. I’d be willing to do what I could.”

  “I’ll raise that at the meeting, too,” promised Walker.

  Morrison had been expecting the offer. He said, “It might be an idea to switch Best Rest back here to Boston. We own the property in Manhattan. If we sold we’d make a hell of a profit. It would go some way towards retrieving the money we’ve lost.”

  “It’s something to consider,” said Walker.

  They’d all been shit scared of what had happened, recognized Morrison. From now on they’d follow like lambs. It was a good feeling, to be so completely in charge; far better than landing a championship fish.

  Morrison emptied the old flowers into a refuse container and threw away the sour water. He rinsed the bowl several times before refilling it and set it back upon the grave before making the new arrangements. Roses. They’d always been Angela’s favourites. Satisfied at last, Morrison hunched back on his heels.

  “I’ve done it, my darling,” he said softly. “I’ve made the bastard pay for what he did to you.”

  39

  Margaret went into the drawing-room early, wanting to be there before Buckland arrived. Establishing territory, she thought. Animals did that; fought for it, when they thought it was being invaded. She started moving towards the drinks tray, but stopped before she reached it. Liquor wouldn’t help. She felt hot and brought a handkerchief to her upper lip. The feeling of sickness had seemed permanent for days. Buckland was on time, which she hadn’t expected, thrusting into the room and then stopping just inside the door, seeming surprised to find her already there.