Mission impossible

Article Abstract:

A new management team and institutional investors have helped transform the struggling Woolworth UK of the early 1980s into today's profitable Woolworth Holdings, which came into existence when the US parent firm F.W. Woolworth sold its 52.6 percent share in Sep 1982. Woolworth's home-grown management and foreign management had been two key problems. The company had failed to adapt to changing market conditions, and there was confusion among customers, employees, and suppliers as to what Woolworth's had been trying to accomplish. A new approach was undertaken which entailed reduction of excessive stocks, broadening of merchandising, competitive pricing, improvements to physical plant, establishment of financial controls, and implementation of a central distribution system. By 1984, Woolworth's was able to acquire electrical retailer Comet and showed major success with its B & Q subsidiary.

Department stores, Woolworth Holdings PLC

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In the best position for a buyout

Article Abstract:

A management group headed by Tim Parker affected a 54 million pounds sterling management buyout of Kenwood, a UK manufacture of kitchen appliances, from Thorn-EMI. The management group became aware that the firm would likely be sold off as Thorn-EMI was reassessing the number of business lines it was in. The management group established themselves as credible purchasers of the firm after deciding they could make the firm a success by enhancing the firm's profitability by reducing overhead and launching new products. The group retained a chartered accountant as an adviser for the buyout and created a business plan which was used to interest investors before negotiations were entered into and completed. Important aspects of the buyout negotiations were an accountants' investigation and warranties and disclosures. Fees added two million pounds to the 54 million pounds cost of the buyout.

Management buyouts, Thorn EMI PLC, Kenwood Corp., Parker, Tim

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Employees share in success

Article Abstract:

The National Freight Corp (NFC) was the first UK nationalized firm to be privatized by the Thatcher government. As a state corporation, NFC had been financially unsound, reaching a peak loss of 31 million pounds sterling in 1975. NFC was sold to its employees in 1982 for 53.5 million pounds. The price of shares increased from 2.5 pence to 185 pence just before the firm was listed. Employees and pensioners currently own 23% and 18% of shares, respectively, and stock voting rules give employees, pensioners, and their family members 52% of the vote. Chmn James Watson states that an employee buyout rather than a management buyout was favored as a means of privatizing NFC because it provided an incentive for employees to make the firm successful.

Case studies, Employee ownership, Privatization, Privatization (Business), Freight forwarders, Freight, Great Britain, Watson, James, National Freight Consortium PLC

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