Outlook: GUS complaint leaves a sour taste

IT WAS THE first anniversary yesterday of the launch of Great Universal Stores' hostile bid for the catalogue retailer Argos. It was also the day on which the Takeover Panel chose to throw out the complaint subsequently brought by the GUS chairman, Lord Wolfson, over tactics used by Argos and its advisers, Schroders, in the unsuccessful bid defence.

Perhaps the Panel is trying to make a point. In the eyes of some, Lord Wolfson's initial complaint to the Takeover Panel's executive last May was petulant and vindictive, not to mention offensive and a waste of time. The executive concluded in June that no breach of the City Takeover Code had taken place. But Lord Wolfson is not the sort to take no for an answer and decided eventually to appeal against the executive's ruling to the full Panel.

His actions smacked then of a man who had overpaid for the business and was seeking to take it out on someone else. They still do, as yesterday's eight-page rant from the GUS camp against the ruling amply demonstrates.

The Panel, of course, is too polite to say as much. So instead it has contented itself with turning Lord Wolfson down on a technicality - that he did not get his appeal in on time.

The rules are straightforward enough and had Lord Wolfson or his advisers, Merrill Lynch, managed to get as far as page four of the Takeover Code they could have read it in black and white. Any appeal has to be lodged within one month. Lord Wolfson took four and a half months.

In anticipation perhaps that he was likely lose the argument, Lord Wolfson's advisers have been furiously pedalling the line that his complaint against Argos was based on a point of principle.

If that was the case, then it is odd that he should have personally pursued four Argos directors, most of whom are now out of a job, writing a four- page letter containing the thinly veiled threat of legal action.

A less charitable but more plausible interpretation of Lord Wolfson's actions was that he was seeking to get a favourable ruling from the Panel under his belt as a prelude to taking the four directors and Schroders to the courts and thence to the cleaners.

Along the way, he has made few friends. For the first time in the Panel's 31-year existence, he chose to question the impartiality of the executive's director-general, Alistair de Freiz, on the grounds that he is on secondment from SBC Warburg Dillon Read, the brokers to Argos. Presumably Lord Wolfson overlooked the fact that Warburgs is also GUS's principal adviser.

The one crumb of comfort Lord Wolfson can take is that the Panel has promised to look at the practice of investment banks being paid a higher success fee in the event of fighting off a hostile bid - as was the case with Schroders.

But otherwise, the entire episode leaves a sour taste in the mouth. Today Lord Wolfson ought to feel just a little chastened as well as a little wiser but the betting is he won't.

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