What a Carve Up! (44 page)

‘I do hope we’ll be seeing you back on the television soon,’ said Thomas desperately, wincing from the pressure on his arm. ‘Another series of
Hancock’s Half Hour,
perhaps?’

They had reached a door to the outside world. Sid pushed it open and let go of Thomas, who breathed a heavy sigh of relief and started brushing down his trousers. When he turned to look at Sid, he was surprised to see his face now contorted with fury.

‘Don’t you read the papers, you ignorant pillock? Me and Tony are history. Finished. Kaput.’

‘I’m sorry, I hadn’t heard.’

And it was at this point that Sid James took a deep breath, pointed a wagging finger at Thomas, and sent him on his way with the parting words which were still fresh in the old man’s mind nearly thirty years later, as he sat chuckling over the incident with his brother Henry by the warm, homely fireside of the Heartland Club.

∗

Perhaps inspired by his visit to Twickenham Studios, Thomas had a number of peepholes installed in various key locations at the Stewards offices when he became chairman of the bank. He liked to know that he could spy on his juniors’ meetings whenever he wanted, and to feel that he had an advantage over everyone else who visited or worked in the building. It was for this same reason that he considered the chairman’s office itself to be such a masterpiece of design: for the oak panelling on the walls was, to all appearances, unbroken, and any visitor trying to leave at the end of an unsuccessful interview might spend several fumbling minutes looking for the door before Thomas would rise to his assistance with an air of tired expertise.

This feature was itself symptomatic of the secrecy in which all of Stewards’ business was habitually cloaked. It was not until the 1980s that merchant banking began to lose its gentlemanly, recreational image and take on a sort of glamour which threatened to encourage a tiny (though still, in Thomas’s view, profoundly unhealthy) flicker of public interest. To some extent he brought it upon himself. Recognizing the huge profits which were to be made from advising the government on its privatization programme, he took aggressive steps to ensure that Stewards secured itself a substantial share of this well-publicized business. He thoroughly enjoyed snatching these huge state-owned companies from the taxpayers’ hands and carving them up among a minority of profit-hungry shareholders: the knowledge that he was helping to deny ownership to many and concentrate it in the hands of a few filled him with a deep and calming sense of rightness. It satisfied something primeval in him. The only place Thomas could find even greater, more lasting fulfilment, perhaps, was in the area of mergers and takeovers.

For a while Stewards led the way in the upsurge of takeover business which swept through the City during the first half of Mrs Thatcher’s reign. It rapidly became clear that if a bank could prove itself capable, against the odds, of helping its clients to swallow up other, more profitable companies (not necessarily smaller ones), then there was no limit to the kind of services it would be able to sell them in the future. Competition between the banks intensified. New terms such as ‘bid fees’ and ‘success fees’ were introduced into City parlance, and it became an increasingly important part of Thomas’s job to mobilize ‘bid teams’ made up of banks, brokers, accountants, lawyers and PR advisers. New methods of financing the bids were devised – using the bank’s own money, for instance, to buy shares in the target companies, or underwriting generous cash alternatives to share offers – which were benignly waved through by the City’s self-regulating watch-dogs. By comparison, the series of largely uncontested mergers which Thomas had negotiated on behalf of his cousin Dorothy and her Brunwin group during the 1960s and 1970s now seemed very modest.

The Guinness trial, carefully timed during the run-up to a general election to prove that the government was taking a strong line on financial malpractice, put a temporary check on the more ruthless procedures. To find a classic instance of Thomas’s methods, then, you would have to look back to the halcyon years at the beginning of the decade, when Stewards’ profits from corporate finance were running at about £25 million and they were advising on thirty to forty takeovers a year. Of these, the case of Phocas Motor Services is about as representative as any.

Phocas was a profitable and highly regarded engineering firm based in the Midlands, supplying a wide range of parts, designs and accessories to the motor industry. They made batteries, central locking devices, in-car stereos, heaters, ventilators, fans and most small electrical components, and had a permanent research and development team working on safer, more responsive versions of existing steering and braking systems. At the beginning of 1982 it became known that a multi-national company working in a similar field was interested in buying them up. There was every reason to believe that the takeover would have been a friendly and beneficial one: the company in question had a track record of realistic expansion and good industrial relations.

Their bid, however, was contested by a flamboyant tycoon who happened to be one of Stewards’ most prestigious clients. He knew very little about the motor industry – most of his holdings were in publishing, retail and sport – and many City observers found it hard to see why he had decided to involve himself at all; but his entry now ensured that this would become one of the most closely fought takeover battles of the year. Both companies were intending to bid for Phocas with their own shares, and so it became the task of their respective bankers to quietly set about the business of mounting share support operations.

It was never going to be a fair contest. At Stewards, Thomas had a limitless range of contacts to whom he could turn for help, both in industry and the City; he was also unhampered by scruple, and had the not inconsiderable advantage of being on terms of close personal friendship with some of the most important members of the Takeover Panel. It was unlikely that any of his more belligerent tactics would earn anything worse than a gentle rap on the knuckles. Precise details are hard to come by, but it’s believed that he clinched the deal by going to another, smaller merchant bank and persuading them to buy several million pounds’ worth of his client’s shares; when their price soared in the closing days of the bid, the bank came back to him and told him they were thinking of selling; and to forestall this disaster, he persuaded his client to mollify them with a deposit, interest free, of the exact sterling equivalent of the current price of the shares in an unnumbered Swiss bank account. Even though this practice – the use of a company’s own money (or, if we’re going to be finicky about this, the money of its employees and shareholders) to support its own share price – was to become the subject of a criminal prosecution in the wake of the Guinness scandal, Thomas was never able to see anything wrong with it. He liked to refer to it as a ‘victimless crime’. It was something of a gamble, admittedly, but one which in his experience almost invariably paid off, and if there was anything at risk, how could he be expected to see it? Blinded by the many screens which had been put up between himself and the rest of the world, he was no longer in a position to catch even the most fleeting glimpse of the people whose money he was gambling with.

Thomas’s client won the battle, in any case, and shortly afterwards the reasons for his interest in Phocas Motor Services became very clear. In addition to its long-term profitability, the company had another valuable asset – namely, a pension fund which had been so well managed and so shrewdly invested that it was, at this time, substantially overfunded. Before the takeover, the Phocas employees were about to have been offered – did they but know it – a year’s holiday from pension contributions, but one of the tycoon’s first decisions upon assuming control was to sack the present fund manager and appoint one of his own men in his place; and when his publishing, retailing and sporting empire collapsed around him like a house of cards less than a year later, the independent auditors brought in to clear up the mess were astonished at the speed and efficiency with which this pension fund had been emptied – not just depleted, but literally emptied – and the money siphoned off to be squandered in a futile attempt to postpone the collapse of various failed imprints, failed chainstores, failed football teams and a dozen other worthless adventures.

Even now, years later, legal manoeuvres to help the pensioners recover their money are still in progress. There is no solution in sight. Thomas Winshaw, whose bank handled every aspect of the flamboyant tycoon’s finances, continues to profess his amazement at the scale of the fraud, and to plead his own baffled ignorance.

∗

Needless to say, I don’t believe him. And I should mention, perhaps, that I have a small personal interest in this case. Phocas Motor Services was the firm my father worked for. He was there for nearly thirty years, and retired just a few months after the pension scandal came to light. The money he had been saving all that time had vanished, and he was left to survive on a state pension, supplemented by a few extra pounds brought in by my mother, who had to return to part-time teaching. It wasn’t the retirement they’d been planning for.

There is no doubt, in my mind, that the stress brought on by this situation would have contributed to his heart attack.

Does this mean that Thomas was an accessory to my father’s murder?

December 1990

1

I lose count of the number of times Fiona and I contrived to go to bed together over the next few weeks: although a purist, I suppose, might take issue with my precise interpretation of the phrase ‘go to bed’. The procedure was something like this. She would come home from work – exhausted, like as not – and get into bed almost at once. Meanwhile I, in my kitchen, would be preparing some tasty morsel: nothing too substantial, because she didn’t have much of an appetite; some scrambled eggs or fish fingers would usually be enough, or sometimes I would just warm up a can of soup and serve it with bread rolls. Then I would take the tray of food across the hallway into her flat, and place it across her legs as she sat propped up against a bank of pillows. I would sit down beside her – technically
on
the bed, you see, rather than in it – and we would eat our little supper together, side by side, for all the world like a couple who’d been married for thirty years or more. And to cap it all, just to make the illusion complete, we would always turn the television on, and sit watching it for hours at a time, barely speaking a word.

I have always associated television with sickness. Not sickness of the soul, as some commentators would have it, but sickness of the body. It probably goes back to the time my father was lying in hospital, following the heart attack which was to finish him off in a matter of two or three weeks at the age of only sixty-one. I’d come up from London as soon as I heard the news and for the first time in many years I was staying under my parents’ roof. It was a peculiar experience, to be back in that newly unfamiliar house, in that suburb which was half-town and half-country, and many mornings were spent sitting at the desk in my old bedroom, looking out at the view which had once marked the full extent of my experience and aspiration, while my mother remained downstairs, trying to find housework to occupy herself or solemnly filling in one of the numerous magazine or newspaper crosswords to which she was by then addicted. But for the afternoons we had developed a little ritual, a ritual designed, I suppose, to keep the dread and the grief at a tolerable distance: and this was where the television set came into its own.

Although my parents lived on the outskirts of Birmingham, their lives tended to revolve around a quiescent, reasonably pretty market town which lay some six or seven miles from their home. It boasted one small hospital, to which my father had been admitted on the day of his attack: visiting hours were from two-thirty to three-thirty in the afternoon, and from six-thirty to eight o’clock in the evening. This meant that the hours between our visits were the most tense and problematic of the day. We would emerge from the hospital into the visitors’ car park and the bright afternoon sunshine, and my mother, who had completely lost the capacity (although it had never before deserted her in the last twenty-five years) to plan her shopping more than a few hours in advance, would drive us both to the local supermarket to buy some packets of frozen food for our evening meal. While she was making this purchase I would get out of the car and wander down the almost deserted High Street – indeed, the only real shopping street – puzzled to think that I had once been unable to conceive of a metropolis more teeming or animated. I looked into the branch of Woolworth’s where I used to spend my long-saved pocket money on budget-priced records; into the newsagent’s where it was possible to buy – although I’d had no inkling of it at the time – only a fraction of the titles available in London; and into the town’s only bookshop, laid out on one thinly stocked floor about thirty feet square, which for years had seemed to me to resemble nothing less than a modern library of Alexandria. It was here, towards the end of my teens, that I used to linger for hours, staring at the covers of the latest paperbacks while Verity fumed and stamped her feet outside. The very sight of these books had never failed to fill me with wonder: they seemed to imply the existence of a distant world populated by beautiful, talented people and devoted to the most high-minded literary ideals (the same world, of course, into which chance would one day allow me to dip my own uncertain feet, only to find it as cold and unwelcoming as the pool which had numbed me into unassuageable tears on that fateful birthday).

After this, anyway, came the most important part of the ritual. We would get back to the house, make two cups of instant coffee, lay out a plate of digestive or Rich Tea biscuits and then, for half an hour, settle down in front of the television to watch a quiz show: a show of awesome frivolity and tameness which we none the less followed with idolatrous concentration, as though to miss even a few seconds of it were to render the whole experience meaningless.