View from City Road: The last straw at Spring Ram

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The Independent Online
The row over over publication of Spring Ram's policy statement on Tuesday is the last straw. The company's incompetence has tested investors' patience too far.

The statement was issued by the company's public relations advisers to newspapers but was not released on the Stock Exchange's Topic system, the company news service most closely watched by the investment community.

On receipt, the Stock Exchange checked with the company that the statement should be published. But it declined to give the go-ahead. The contents of the statement, however, were price-sensitive and so should have gone out on Topic. Fund managers certainly expected as much. Investors were left wondering whether the public relations firm was acting with the company's authority in making the statement. It said it was.

This tussle aside, the unofficial statement raised more questions than it answered. It said that the board was behind Bill Rooney - the embattled chairman - but 'recognises and accepts the need for immediate and major changes in the structure, style and management of the company'.

What this means is unclear. Mr Rooney founded the company and is inextricably connected to its structure, style and management. He deserves credit for building up Spring Ram, but now the board has decided that things have to change, Mr Rooney must resign.

It is hard to see either a chairman or a chief executive from outside agreeing to work alongside him.

His departure would boost the shares - there might even be bid hopes if Mr Rooney sold his 16 per cent stake.