Magazine article The Spectator

Do Dreams Come True? Will Hornby Save Airfix? Will I Be Chairman of Barclays?

Magazine article The Spectator

Do Dreams Come True? Will Hornby Save Airfix? Will I Be Chairman of Barclays?

Article excerpt

Can there be a middle-aged man in Britain whose heart did not beat a little faster last week at the news that Hornby has expressed an interest in acquiring Airfix? This would be a merger that might have been dreamed up in a 1960s toy cupboard. Ailing Airfix is owned by Humbrol, which makes the little pots of enamel paint we used to use on our Airfix model aeroplanes, and which also produces Plasticine. Hornby is the great model railway company that also happens to make Scalextric cars. To complete the set, all we need is a deal-structure modelled in Meccano (also originally a Hornby product) by a suave young investment banker called Action Man (b. 1966).

But can Airfix survive at all? Its fundamental problem is that so few of today's small boys, reared on fast food and computer games, have the attention span or enthusiasm required to assemble a classic Airfix Spitfire kit. Perhaps even fewer know what Spitfires did, or have been encouraged by their parents to find out. Airfix survived as a specialist hobby business, but now the French supplier that actually made the kits has gone into receivership while refusing to hand over its plastic mouldings, leaving Airfix utterly unglued.

If any company can turn that situation around, however, it must be Hornby, which ten years ago was also almost moribund, serving a dwindling market of anorak-clad model railway hobbyists. But under the management of a brisk Mancunian called Frank Martin -- who used to run Humbrol -- Hornby revived itself so successfully that it was named Company of the Year at the 2002 UK PLC Awards. Martin's strategy had three key elements to it. He outsourced production of model trains to Guangdong, reducing his costs and -- to the anoraks' surprise -- improving quality. He jumped on the Harry Potter bandwagon with the bestselling Hogwarts Express train set, the magic of which allowed many thousands of dads to drag otherwise reluctant sons into the lost world of model railways. And he made a virtue of tradition, reintroducing genuine steam power into miniature locos with the slogan 'The future is steam!' A similar formula could surely work for Airfix, and there must be dozens of Chinese plastics factories capable of remaking the missing mouldings in next to no time. Let's hope the deal goes through: if it does, there'll be lashings of jelly and ginger pop for tea at my house.

My Barclays bid I see I have been passed over for the chairmanship of Barclays. Perhaps the board felt I should have struck a more positive note in the book I wrote six years ago, partly about my own experiences working there, called Falling Eagle: the Decline of Barclays Bank -- yours for £3.50 on Amazon Marketplace these days. Instead, they have given the job to Marcus Agius -- the suavest Action Man of his City generation (b. 1946), with a long track record as a corporate financier at Lazards and a wife whose maiden name was de Rothschild. For captains of industry, to have retained Agius as your adviser in any takeover deal of the past 20 years was like being able to say 'Henry Cecil is my trainer' or (possibly) 'David Linley makes my patio furniture'. …

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