`Friendless' Bock to leave Lonrho
Sunday 01 December 1996
Informed sources this weekend said he had become friendless on the board, "which has no desire to see him remain in a position of influence", following the sale of his remaining 18 per cent stake to South African mining giant Anglo-American.
That deal, which left Anglo with 27 per cent, is now being investigated by the European Commission.
Lonrho, meanwhile, is still negotiating with Saudi prince al-Waleed bin Talal over the disposal of its Princess hotels in the US following the pounds 327m sale of its Metropole chain to Stakis two weeks ago.
Mr Bock stepped down to become non-executive deputy chairman after the sale of his stake, saying he wanted to take a substantial stake in Lonrho Africa.
Disposal of the African trading business was to mark the final step in the break-up of the once sprawling empire built by his predecessor and bitter rival, Tiny Rowland.
This weekend, however, a Lonrho spokesman said there was no guarantee it would now elect to hive off the division, which would leave the group principally as a gold and platinum mining operation.
He said that after the Princess Hotels business is sold, "which will be by Christmas", options "include keeping the company as it is, or demerging it".
One scenario, he added, would see the company - headed by new chief executive Nick Morrell - remain as it is, and electing to grow through acquisition.
Retaining Lonrho in its present structure would fly in the face of current market expectations. It may also hurt the shares, which have already collapsed over the past month to 134p, compared with the 180p at which Mr Bock sold out.
In all, the shares have fallen from 217p in February, exacerbated by Anglo's perceived stranglehold, while at the same time eschewing a full bid.
Lonrho was aiming for a similar price for Princess as was achieved for Metropole. However, other sources close to the company said this weekend there were still tax uncertainties about the deal and the Saudi offer was closer to $440m (pounds 260m), with up to $300m deferred.
Whether or not the company demerges, Mr Bock is expected to further reduce his role and an involvement in Lonrho Africa is increasingly unlikely.
Institutions are dismayed at the turn of events, as the German property developer aroused great hopes in the City when he arrived in 1993 and subsequently ousted Mr Rowland.
"There is anger and disappointment Dieter has sold out at a price not available to the rest of us," one fund manager said.
He added that Mr Bock's interest in the African trading arm "did not really ring true. We have assumed he will not be staying".
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