Glaxo Wellcome yesterday warned of redundancies amongst 1,550 staff working at Wellcome’s main UK research and development site at Beckenham, Kent, as it confirmed the site’s closure over three years in the most significant rationalisation move since the pounds 9.4bn takeover of the company in March. However, Sir Michael and Sir Ian Prosser, chairman and chief executive of Bass, claim that S&N would control more than 31 per cent of the beer market – a clear breach of the Monopoly benchmark of 25 per cent.Sir Michael, a former President of the Confederation of British Industry, said yesterday: “Whichever way the market share of the merged company is calculated, there is no doubt that it would lead to the biggest ever concentration in UK brewing.”In all recent, and much smaller, examples of brewery mergers the competition authorities have referred them for investigation and without exception they have been found to be against the public interest.”He then reminded the 500-plus shareholders at the meeting of what happened in 1989 when S&N was on the wrong end of a bid from Elders, the Australian group and then owners of Courage “Permission to proceed was denied. Whitbread also tried to buy Courage but, according to sources, was fully prepared to face a MMC probe and possibly have to agree to some restrictive conditions before gaining clearance.His strong comments about the S&N situation were made at Whitbread’s annual meeting for shareholders in London.Failure to investigate, he warned, would lead to an acquisitive stampede by other brewers to close the gap with S&N which would leapfrog Bass as the industry’s market leader if its take-over went through undiluted.The heads of the leading brewing companies, Whitbread included, accept that concentration at the top of the industry is inevitable given the changing market conditions. A big row is developing in the brewing industry over reports that the Office of Fair Trading will not recommend a monopolies investigation into the pounds 435m take-over bid launched last month by Scottish & Newcastle Breweries for Courage

The OFT said yesterday that it hoped to next week send the results of its findings about S&N’s acquisition to Michael Heseltine, President of the Board of Trade, who has the ultimate say on whether take-over deals should be referred.
Sir Michael Angus, chairman of Whitbread, yesterday openly challenged the Government to clarify its competition policy by calling for the Monopolies and Mergers Commission to investigate the take-over of Courage.

He now operates a 245 foot yacht called Leander, after HMS Leander his war time ship.. Sir Donald pledged pounds 5m.His nautical links go back to the Second World War, when he was a signaller on a war ship. Sir Donald’s personal wealth is in the region of pounds 200m.A plan to sell the business to a management buy-in team fell through when the buyers decided they could not meet the pounds 650m that the two men were looking for.Last summer, Sir Donald hit the headlines when he proposed that a consortium of businessmen chip in to buy a replacement for the royal yacht, Britannia, which is to be decommissioned in 1997. Today it operates over 600 car parks around the country.The two men are now looking to retire from the business, and the payments yesterday can be seen as an advance on the proceeds that would come to them whenever the business is sold.They have equal shares of 35 per cent in the business so they will make pounds 65m each. Some of Sir Donald’s stake has been transferred to a family trust.The two men are already extremely rich.

The company’s shares will in future be traded privately.In the early days the company charged 4p for a day’s parking in central London. Sir Donald Gosling, 66, and Ronald Hobson,74, founded National Parking Corporation in 1949, when they spotted the chance to convert London bomb sites into car parks. They now own 70 per cent of the company, with the rest in the hands of City institutions.
NPC said it was making the payout, in the form a special dividend, to let shareholders realise some of the value of their stake following the failure last year of an attempt to sell the company to a management buy- in team.NPC also announced that it made pre-tax profit of pounds 47.9m for the year to the end of March, down slightly on pounds 50.4m made in the previous year.However this year’s figure includes an exceptional charge of pounds 8m to buy back shares allocated to the company’s share option scheme.The pounds 8m will be shared out between 300 NPC staff, an average of pounds 26,666 each.The company said it would be seeking a stock market listing within the next four years.There are no plans to list the company on the Stock Exchange’s new Alternative Investment Market, which is a replacement for the rule 4.2 market, due to close in September, in which NPC’s shares have been traded. Two publicity-shy entrepreneural pensioners yesterday saw their personal wealth boosted by a combined pounds 131m as the car park company they founded in the aftermath of the Second World War made a pounds 183m one-off payout to shareholders. Britain could achieve a “soft landing” after 1996.The report forecasts that growth will fall from 3.4 per cent in the first half of this year to 2.9 per cent by the second half of 1996. Unemployment will continue to fall from 8.3 per cent of the workforce to 7.4 per cent.Dramatic currency movements this year pose a risk to steady growth and low inflation in the industrial countries as a whole, yesterday’s report said .But it concludes that the risk can be contained, taking a rosy view of prospects for the next 18 months, despite a sharp reduction in its forecast for growth in Japan.“The current expansion in the OECD area has the potential to mature into a phase of durable growth of employment and incomes in a stable, non-inflationary environment.”. “Even so, short-term interest rates may have to be raised further, perhaps to around 8 per cent, to slow demand growth to that of potential output beyond 1996,” the report said.

It is widely believed that Mr Clarke turned down the Bank’s advice to raise rates after that meeting. Most analysts do not expect any rise in base rates until the autumn or later, thanks to signs that the recovery has begun to slow to a sustainable pace.The OECD said tax increases and lower public borrowing would rein in demand this year, and previous rises in interest rates would have an increasing impact in slowing the economy next year. The influential Paris-based think-tank said the credibility of Britain’s new monetary arrangements had not yet been fully established. In addition, if the 5 per cent fall in the pound this year was not reversed, this would translate into higher inflationary pressure.
The OECD’s forecast that consumer price inflation will climb to 3 per cent, above the 2.5 per cent target that the Chancellor, Kenneth Clarke, set out in his Mansion House speech, will come as an embarrassment to him.He has held base rates unchanged at 6.75 per cent since February, despite warnings in the Bank of England’s latest Inflation Report that the inflation target would be breached unless rates were raised.Shadow Chancellor Gordon Brown said yesterday: “The OECD does not believe what the Government is saying on economic policy.” The fact that the organisation’s latest forecasts are even mildly critical of the British economy is a contrast to the praise it has heaped on the Government in recent years for its success in deregulating the jobs market.Today brings the publication of the minutes of the 5 May meeting between Mr Clarke and Eddie George, Governor of the Bank of England. Inflation in Britain will climb above the Government’s target and interest rates might have to rise to 8 per cent, according to the mid-year economic report from the Organisation for Economic Co-operation and Development. Additionally, total shareholder return rather than stock price might become the target measure.Despite the apparent willingness to bend, WPP continued to defend the total remuneration package yesterday. Brian Brooks, WPP finance director, said: “What distinguishes the package from other executive remuneration packages in the UK marketplace is the requirement of a significant personal investment and the degree of risk that no payout will occur, which reflects the difficulty of reaching the performance targets.”.

It is these incentives that both WPP and Mr Sorrell appear prepared to drop in order to win approval for the potentially more lucrative CIP.The additional incentives had drawn fire from institutional investors such as Hermes and Robert Fleming, who believed that there was too much overlap with the CIP.WPP and Mr Sorrell are also willing to attach new conditions to the exercise of the pre-awarded phantom options, presently worth up to pounds 5.3m if WPP stock rises to 304p, the top of the incentive range.For example, the options might be exercisable only if WPP shares rise by as much as the average increase in the FTSE-100 and the S&P 500. The highest of these, 304p, is only slightly higher than the stock price at the time Mr Sorrell joined WPP in 1986 and well below the 900p level achieved in mid-1987.For the CIP incentives to kick in, the shares must also match or beat the average rise in the FTSE-100.This is in addition to Mr Sorrell’s salary of pounds 3.75m over five years, pension contributions of pounds 1.6m and a bonus worth a maximum of pounds 3.75m.Mr Sorrell is also due to benefit from additional stock price-related incentives worth up to pounds 2.7m. According to sources within the company, pressures from institutional shareholders have sparked a series of meetings this week aimed at agreeing changes to the package, worth as much as pounds 31.6m to Mr Sorrell over five years, in order to secure broader shareholder support.
The proposed changes, which would affect performance-related pay, follow criticisms voiced by as many as six of WPP’s leading institutional shareholders.Publicly, WPP said it would not postpone the meeting nor make changes to the Capital Investment Plan (CIP), the incentive scheme being put to shareholders that could net Mr Sorrell as much as pounds 14.3m over five years.Moreover, the company stressed that it believed Mr Sorrell’s overall package was consistent with the Cadbury guidelines on executive remuneration and was similar to pay awards at comparable international advertising companies such as Omnicom and Inter-public Corporation, both based in the US.All the same, the company is prepared to drop a pre-existing performance- related scheme and to add more onerous conditions to a phantom option plan in place since 1993.Under the CIP proposal, Mr Sorrell is investing pounds 2.2m of his own resources in WPP shares, and stands to receive shares worth between pounds 2.3m and pounds 14.3m over five years, provided the stock hits pre-determined price targets. Martin Sorrell and WPP, the advertising company of which he is chief executive, are prepared to back down on elements of a controversial performance- related pay scheme in advance of the company’s extraordinary general meeting later this month. That will require us to do more economic work.”The commission believes that bilateral deals will weaken airline liberalisation in Europe and harm some countries.Legal proceedings against six countries that have already initialled deals (Austria, Belgium, Luxembourg, Denmark, Finland and Sweden) have already begun and a letter to Britain is imminent.The commission official rejected the idea that Mr Kinnock was given the brush-off from transport ministers yesterday, saying: “This is as much as he would expect to have got at this stage of the proceedings.”Mr Kinnock said he was delighted at the results..