Cash-in ahead at VSEL: Cambridge don stands to gain nearly pounds 1m from bid for shipyard

AN ENGINEERING professor at Cambridge is set to be the biggest individual winner from any sale of VSEL, the shipbuilder that announced it had received a takeover approach last week.

Shon Ffowcs Williams, Rank Professor of Engineering (Acoustics) and fellow of Emmanuel College, is a non-executive director of VSEL who, according to the accounts for the year ending in March, owns 79,039 shares. At Friday's closing price of pounds 12.10, his holding is worth pounds 956,000.

Prof Ffowcs Williams was co-founder of Topexpress, a Cambridge-based engineering consultancy that specialised in 'anti-noise' - the generation of pressure waves to cancel noise. It was bought by VSEL in 1987 for 730,000 shares, of which the professor received 252,000. He became a non-executive director of VSEL in October that year.

The professor, who lists his hobbies in Who's Who as friends and cigars, sold 100,000 shares during 1992/3, raising about pounds 400,000.

VSEL's shares jumped by 252p on Thursday after the company confirmed an approach by a friendly bidder. The City believes it is British Aerospace, though neither company will confirm this.

A bid will have to be approved by the Ministry of Defence, which still holds a golden share. It can block any individual holding in VSEL of more than 15 per cent. However, shipbuilding experts say the Government would be unlikely to discourage a link with BAe, because a merged company - probably working closely with the Norwegian-owned Kvaerner Govan - would help counterbalance the increasing domination of GEC in the defence world.

The City believes a BAe takeover would be purely financially motivated, as it would give BAe access to VSEL's cash pile, but industry sources say it could have commercial logic. Previously, the MoD bought naval systems, such as BAe's Sea Wolf missile launchers, directly from the supplier, and then told the shipyard to install them. Under the new 'whole ship procurement' approach, the yard is the prime contractor and suppliers are pushed into a secondary role. BAe always attempts to have a leading role, and the only way it can regain that is to buy a shipyard.

When VSEL was privatised in 1986, 11,500 workers became shareholders. Most of them sold out after a couple of years, having tripled their money, but there is still likely to be a healthy injection of cash into the Barrow-in-Furness economy if the shipyard is sold. Just under 1,000 workers still hold shares, and 739,000 employee share options were issued in 1992. These are exercisable at pounds 4.07 in 1998; but a takeover is likely to trigger early payment, generating at least pounds 6m.

The likelihood of a bid for VSEL has cast uncertainty over the future of the Devonport Dockyard, which repairs nuclear submarines. It is currently state-owned, but is managed by a consortium of Brown & Root, Weir Group and BICC. The Government has announced it is to be sold, and preliminary bids must be in by the end of this month. Both the existing consortium and VSEL have said they intend to make an offer, but VSEL is unable to make any move while a bid hangs over it.

The industry and City are now watching to see what moves, if any, will be made by GEC. It owns the Yarrow shipyard and was ready to buy Swan Hunter last year, when Swan lost an important order to VSEL and went into receivership. The industry a bid for VSEL from GEC and is waiting to see if he will allow BAe to go ahead unchallenged.

(Photographs omitted)

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Business Analyst - Financial Services - City, London

£50000 - £55000 per annum: Ashdown Group: Business Analyst - Financial Service...

SThree: Trainee Recruitment Consultant

£18000 - £23000 per annum + OTE £45K: SThree: At SThree, we like to be differe...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is the o...

Recruitment Genius: Administrator - IFA Based

£22000 - £24000 per annum: Recruitment Genius: This is an opportunity to join ...

Day In a Page

Arsenal vs Chelsea: Praise to Arsene Wenger for having the courage of his convictions

Michael Calvin's Last Word

Praise to Wenger for having the courage of his convictions
Major medical journal Lancet under attack for 'extremist hate propaganda' over its coverage of the Israeli-Palestinian conflict

Lancet accused of 'anti-Israel hate propaganda' over coverage of Gaza conflict

Threat to free speech as publishers of renowned medical journal are accused of inciting hatred and violence
General Election 2015: Tories and Lib Dems throw their star names west to grab votes

All noisy on the Lib Dems' western front

The party has deployed its big guns in Cornwall to save its seats there. Simon Usborne heads to the heart of the battle
How Etsy became a crafty little earner: The online market has been floated for £1.2bn, but can craft and capitalism coexist?

How Etsy became a crafty little earner

The online market has been floated for £1.2bn, but can craft and capitalism coexist?
Guy Ritchie is the latest filmmaker to tackle King Arthur - one of our most versatile heroes

King Arthur is inspiring Guy Ritchie

Raluca Radulescu explains why his many permutations - from folk hero to chick-lit hunk - never cease to fascinate
Apple Watch: Will it live up to expectations for the man or woman on the street?

Apple Watch: Will it live up to expectations?

The Apple Watch has apparently sold millions even before its launch tomorrow
Don't fear the artichoke: it's a good cook's staple, with more choice than you'd think

Don't fear the artichoke

Artichokes are scary - they've got spikes and hairy bits, and British cooks tend to give them a wide berth. But they're an essential and delicious part of Italian cuisine
11 best men's socks

11 best men's socks

Make a statement with your accessories, starting from the bottom up
Paul Scholes column: Eden Hazard would be my Player of the Year – but I wonder if he has that appetite for goals of Messi or Ronaldo

Paul Scholes column

Hazard would be my Player of the Year – but I wonder if he has that appetite for goals of Messi or Ronaldo
Frank Warren: Tyson Fury will be closely watching Wladimir Klitschko... when he wins it'll be time to do a deal

Frank Warren's Ringside

Tyson Fury will be closely watching Wladimir Klitschko... when he wins it'll be time to do a deal
London Marathon 2015: Kenya's brothers in arms Wilson Kipsang and Dennis Kimetto ready to take on world

Kenya's brothers in arms take on world

Last year Wilson Kipsang had his marathon record taken off him by training partner and friend Dennis Kimetto. They talk about facing off in the London Marathon
Natalie Bennett interview: I've lost track of the last time I saw my Dad but it's not because I refuse to fly

Natalie Bennett interview: I've lost track of the last time I saw my Dad

Green leader prefers to stay clear of her 'painful' family memories but is more open about 'utterly unreasonable' personal attacks
Syria conflict: Khorasan return with a fresh influx of fighters awaiting the order to start 'shooting the birds'

Khorasan is back in Syria

America said these al-Qaeda militants were bombed out of the country last year - but Kim Sengupta hears a different story
General Election 2015: Is William Cash the man to woo Warwickshire North for Ukip?

On the campaign trail with Ukip

Is William Cash the man to woo Warwickshire North?
Four rival Robin Hood movies get Hollywood go-head - and Friar Tuck will become a superhero

Expect a rush on men's tights

Studios line up four Robin Hoods productions