BRITAIN FOR SALE; One Byone,the Great Firms That Defined Our Industrial History Are Falling into Foreign Hands. A Tribute to Our Free Market? or Economic Suicide . .?

Daily Mail (London), February 28, 2006 | Go to article overview

BRITAIN FOR SALE; One Byone,the Great Firms That Defined Our Industrial History Are Falling into Foreign Hands. A Tribute to Our Free Market? or Economic Suicide . .?


Byline: ALEX BRUMMER

BRITAIN is being swamped by a tide of foreign bids symbolised by a Japanese interloper's takeover this week of the famous St Helens-based glassmaker Pilkington.

The flood of foreign takeovers of Britain's core companies threatens not only to end centuries of industrial heritage, but also to damage gravely the nation's control over future research and development - and, ultimately, its own commercial destiny.

Nippon Sheet Glass's bid for Pilkington follows hard on the surrender by the Peninsular & Oriental Steam Navigation Company (P&O) of its independence to the Middle Eastern state of Dubai, bringing an end to 168-years of ruling the high seas.

Ironically it is the U.S. Congress, fearful of ceding control of six of its major ports to the Arabs, which is passing a law seeking to stop the [pounds sterling]4 billion takeover.

Not a peep of opposition to this landmark transaction has been heard from the British Government or from our own politicians.

Also on the current overseas shopping list is the British Airports Authority, which owns Heathrow, Gatwick and Stansted, and is an important strategic asset. The Spanish engineering group Ferrovial is preparing a [pounds sterling]10 billion plus takeover bid.

But should we be surprised?

Even the London Stock Exchange, the second largest share market in the world and an exemplar of freewheeling Anglo-Saxon capitalism, has been under siege for more than a year from overseas buyers.

And the onslaught on the nation's industrial crown jewels - manufacturing firms which can trace their origins to the glory days of the Industrial Revolution - have sent share prices among Britain's top 100 companies soaring, despite concerns about a slowdown in the economy.

New figures show that in 2005 alone, before the current onslaught, more than [pounds sterling]50bn worth of British assets were snapped up by foreign firms. This far outstripped traffic in the opposite direction, yet few critical words about this phenomenon have been heard from the Government.

In fact, it took the spectre of British Gas falling into the hands of the Kremlin to force a pledge from ministers that any such offer would be 'robustly scrutinised'.

Many other countries, notably France and the U.S., have drawn a red line around key national assets, declaring them to be 'strategic', to keep overseas predators at bay. But Great Britain plc has put up a 'For Sale' sign and welcomes anyone with a bulging wallet of cash.

Indeed, the overseas sales include several companies with the word 'British' in their names.

The German chemical group Linde has made a [pounds sterling]7.6bn offer for the British Oxygen Company (BOC), a firm dating back to 1886, which supplies hospitals around the world with medical gasses.

Late last year, British Plaster Boards (BPB), the biggest supplier of plasterboards to the global building trade, was sold to St Gobain of France for [pounds sterling]3.9bn.

But the bidding war that most stirs the blood surrounds P&O, founded in 1840 by Royal Charter, a survivor of the days when Britain was a trading powerhouse.

Under the captaincy of Lord Sterling, a former adviser to Mrs Thatcher, the company invested heavily in ports and became a leading container group.

Now Lord Sterling has retired and P&O has been knocked down to the oil statelet of Dubai.

Angry retail shareholders accused the P&O board of selling out to 'Johnny Foreigner'. No one was more upset than Lord Sterling, who said it was not just a company that was being sold but the 'fabric of the Empire'.

It's hard to miss the irony: a state company from Dubai, an outpost of the Empire, buying a publicly quoted firm and a household name in Britain.

In one respect, the rush to buy British assets reflects well on the openness of our markets and financial system.

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BRITAIN FOR SALE; One Byone,the Great Firms That Defined Our Industrial History Are Falling into Foreign Hands. A Tribute to Our Free Market? or Economic Suicide . .?
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