Outlook: Tarmac/Aggregate

SIR NEVILLE SIMMS, chairman of Tarmac, is being accused of letting ego get in the way of the creation of shareholder value. Merger talks with Aggregate Industries broke down earlier this week amid bitter disagreement over just who was going to be in charge - Sir Neville, or the head of Aggregate, Peter Tom.

Scandalous, many cried. Management ego has undermined a merger which was clearly in shareholders' interests, just like Glaxo Wellcome and SmithKline Beecham. And because Tarmac seems to be the company more obviously in need of treatment, it is all Sir Neville's fault for not agreeing whatever demands Mr Tom might have had.

In truth, however, it seems to be less Sir Neville who is to blame than Mr Tom. The two had agreed a division of management functions which seemed reasonably fair. Mr Tom would be chief executive, Sir Neville chairman, and the two of them would jointly chair the committee charged with integrating the companies after the merger.

At the last moment, however, Mr Tom changed his mind. He wanted Sir Neville out of the picture altogether and if he wasn't prepared to go, then the deal would be off. Since Mr Tom appears to have tried this tactic twice before in his climb to the top, and with some success, he might reasonably have expected it to work this time round as well.

The first time was when Mr Tom reversed his family company Bardon into the larger Evered in the early 1990s. In the process Roy Kettle, chief executive of Evered, agreed to step aside and become vice chairman. Shortly afterwards he left entirely.

Much the same thing happened when Bardon was reversed into Camas, again a larger company, to create Aggregate Industries last year. For years these merger talks had foundered on "management issues". Eventually it was agreed that Alan Shearer, chief executive of Camas, would become non executive chairman of the combined company. Then, inexplicably, it was announced that he would step down altogether, so as to "break the impasse".

Plainly Mr Tom is something of an operator, but it is hard to understand why shareholders in Tarmac should want to help him in his endeavours unless there is something in it for them. This was meant to be a "no premium merger", not a takeover. For a takeover, which is what Mr Tom now seems to be demanding in all but name, it is customary to pay a premium.

Who knows, perhaps Mr Tom will eventually get his way, but since when was it part of the fiduciary duty of directors to agree to sell themselves short?

Sport
Radamel Falcao
footballManchester United agree loan deal for Monaco striker Falcao
Voices
A man shoots at targets depicting a portrait of Russian President Vladimir Putin, in a shooting range in the center of the western Ukrainian city of Lviv
voicesIt's cowardice to pretend this is anything other than an invasion
Arts and Entertainment
The eyes have it: Kate Bush
music
Sport
Louis van Gaal, Radamel Falcao, Arturo Vidal, Mats Hummels and Javier Hernandez
footballFalcao, Hernandez, Welbeck and every deal live as it happens
PROMOTED VIDEO
Arts and Entertainment
booksNovelist takes aim at Orwell's rules for writing plain English
Arts and Entertainment
Al Pacino in ‘The Humbling’, as an ageing actor
filmHam among the brilliance as actor premieres two films at festival
News
Fifi Trixibelle Geldof with her mother, Paula Yates, in 1985
people
Arts and Entertainment
Downton Abbey fans rejoice, series five returns later this month
TV
Arts and Entertainment
booksExclusive extract from Howard Jacobson’s acclaimed new novel
News
i100
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
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

Application Support Analyst / Junior SQL Server DBA

£40000 - £45000 per annum: Ashdown Group: An established professional services...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Business Development Manager / Media Sales Exec

£28 - 32k + Uncapped Commission: Guru Careers: A Business Development Manager ...

C# .NET Developer (PHP, Ruby, Open Source, Blogs)

£40000 - £70000 per annum + Bonus+Benefits+Package: Harrington Starr: C# .NET ...

Day In a Page

Alexander Fury: The designer names to look for at fashion week this season

The big names to look for this fashion week

This week, designers begin to show their spring 2015 collections in New York
Will Self: 'I like Orwell's writing as much as the next talented mediocrity'

'I like Orwell's writing as much as the next talented mediocrity'

Will Self takes aim at Orwell's rules for writing plain English
Meet Afghanistan's middle-class paint-ballers

Meet Afghanistan's middle-class paint-ballers

Toy guns proving a popular diversion in a country flooded with the real thing
Al Pacino wows Venice

Al Pacino wows Venice

Ham among the brilliance as actor premieres two films at festival
Neil Lawson Baker interview: ‘I’ve gained so much from art. It’s only right to give something back’.

Neil Lawson Baker interview

‘I’ve gained so much from art. It’s only right to give something back’.
The other Mugabe who is lining up for the Zimbabwean presidency

The other Mugabe who is lining up for the Zimbabwean presidency

Wife of President Robert Mugabe appears to have her sights set on succeeding her husband
The model of a gadget launch: Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed

The model for a gadget launch

Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed
Alice Roberts: She's done pretty well, for a boffin without a beard

She's done pretty well, for a boffin without a beard

Alice Roberts talks about her new book on evolution - and why her early TV work drew flak from (mostly male) colleagues
Get well soon, Joan Rivers - an inspiration, whether she likes it or not

Get well soon, Joan Rivers

She is awful. But she's also wonderful, not in spite of but because of the fact she's forever saying appalling things, argues Ellen E Jones
Doctor Who Into the Dalek review: A classic sci-fi adventure with all the spectacle of a blockbuster

A fresh take on an old foe

Doctor Who Into the Dalek more than compensated for last week's nonsensical offering
Fashion walks away from the celebrity runway show

Fashion walks away from the celebrity runway show

As the collections start, fashion editor Alexander Fury finds video and the internet are proving more attractive
Meet the stars of TV's Wolf Hall... and it's not the cast of the Tudor trilogy

Meet the stars of TV's Wolf Hall...

... and it's not the cast of the Tudor trilogy
Weekend at the Asylum: Europe's biggest steampunk convention heads to Lincoln

Europe's biggest steampunk convention

Jake Wallis Simons discovers how Victorian ray guns and the martial art of biscuit dunking are precisely what the 21st century needs
Don't swallow the tripe – a user's guide to weasel words

Don't swallow the tripe – a user's guide to weasel words

Lying is dangerous and unnecessary. A new book explains the strategies needed to avoid it. John Rentoul on the art of 'uncommunication'
Daddy, who was Richard Attenborough? Was the beloved thespian the last of the cross-generation stars?

Daddy, who was Richard Attenborough?

The atomisation of culture means that few of those we regard as stars are universally loved any more, says DJ Taylor