Rowland and Bock claim differences are resolved: Shares rise on jump in profits from pounds 114m to pounds 172m

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The Independent Online
DIETER BOCK and 'Tiny' Rowland, joint chief executives of Lonrho, yesterday claimed to have settled their differences as a range of boardroom changes were announced and higher profits for the group were unveiled.

In the boardroom changes, four Lonrho directors, including the chairman, are to retire and leave the board of the international trading group, following pressure by Mr Bock.

Details of the departures were announced yesterday as Lonrho reported an increase in pre-tax profits, from pounds 114m to pounds 172m for the year ended in September 1993. Shareholders will receive an unchanged dividend of 4p a share. The share price rose 8p to 153p on the news.

Sir Peter Youens, a director of Lonrho for 16 years, will retire at the annual meeting. Two deputy chairmen, Robert Dunlop and Paul Spicer, who have each served the company for 24 years, intend to retire in the course of Lonrho's current financial year.

The group chairman, Rene Leclezio, 74, is also stepping down and a new chairman for the company is being sought, who may recruited from outside the company.

The outgoing directors, who have all reached retirement age, are believed to be receiving the equivalent of two years' salary as compensation for loss of office.

Mr Bock yesterday confirmed that the details of the terms would eventually be disclosed to shareholders.

Mr Spicer and Mr Dunlop could each receive a pay-off in excess of pounds 800,000 to compensate them for loss of office, in addition to their pensions.

Mr Bock, who presented the group's results with Mr Rowland at Lonrho's headquarters, said the company was 'morally obliged' to make the payments in what he regarded as 'a low package'.

The four who are leaving are said to be long-term allies of Mr Rowland, who has been at odds with Mr Bock since he joined the board last year after acquiring an 18.8 per cent shareholding.

Mr Rowland, however, was in conciliatory mood yesterday. 'There is no difference between us. There is no misunderstanding now.' he said. 'We are completely in tune.'

Despite the departure of the directors who have reached retirement age, Mr Rowland, 76, intends to stay on. 'I don't feel older. I am physically fit and alert.'

Mr Bock has been frustrated in his attempts to reform the company over the past year and bring it into line with established business practice. But yesterday's proposed departure of four directors completes part of his ambitions to change the boardroom structure.

At the annual meeting in March shareholders will be asked to approve changes in Lonrho's highly protective articles of association to bring them into line with latest business practice in Britain.

Lonrho disclosed that the Metropole hotels chain, in which the investment arm of the Libyan government has a 33 per cent interest, has been revalued and shows a reduction in shareholders' funds of pounds 186m, virtually the same price that the Libyans paid for the stake less than two years ago.

The results show that Lonrho generated pounds 87m profit from the sale of assets in its last financial year, including a pounds 4m profit from its sale of the Observer newspaper. Mr Bock said he was pursuing his aim of grouping Lonrho around four main areas of activity: mineral extraction and refining, hotels, general trade and agriculture.

However, Mr Leclezio has told shareholders that while the restructuring process went on, Lonrho continued to take up new opportunities.

He pointed out that Lonrho had doubled its interests in coal mining. 'There is a growing interest by internal investors in the emergent markets of Africa, which will enable your board to develop its activities there with a particular view to attracting more capital investment from abroad,' he said.

He said the company had signed an agreement to develop a gold field in Uzbekistan in partnership with the Uzbekistan government.

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