City: Old wounds

ONE of the best stories about Sir Anthony Tennant, due to retire shortly as chairman of Guinness, concerns his negotiations with Morgan Grenfell over Guinness's pounds 100m out-of-court settlement with the Argyll Group. Sir Anthony felt that since Morgan Grenfell was a big part of the mischief during the Distillers takeover, it should be obliged to make a very substantial contribution. John Craven, Morgan's chief executive, and his German masters, Deutsche Bank, saw otherwise and there came a point when negotiations appeared to have reached an impasse. Without a flicker of annoyance, Sir Anthony turned to a colleague and said: 'I think it's time we paid a visit to the Governor of the Bank of England, don't you?' Within days, Morgan Grenfell had agreed to make a substantial contribution.

As Sir Anthony reminded guests at a dinner to mark his retirement at the Dorchester Hotel in London last week, they were dark days indeed for Guinness when he joined the company in the winter of 1987. His predecessor as chief executive, Ernest Saunders, had been sacked and the doors to his office locked and chained. Even the filing cabinets had been emptied by the DTI. The air was thick with scandal, recrimination and despair. In the midst of it, Sir (as he then was) Jack Lyons sent out a Christmas card showing Mrs Thatcher surrounded by the leading lights of Baine's London office and the message: 'May next year bring peace, truth and tranquillity.'

Today the contrast could hardly be greater. Guinness is one of Britain's top-performing companies, and the old wounds have healed. As if to prove the point, David Webster of Argyll, Guinness's bitter adversary in the battle for Distillers, was among those from industry, commerce, the City and government at the retirement dinner. 'It does feel strange,' he admitted. 'But it's all a long time ago now.'