Woolwich steps up hunt for new chief

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The Independent Online
Woolwich Building Society's hunt for a new chief executive acquired fresh urgency yesterday as it sought to deflect a possible takeover by rival predators, including Prudential.

The society hopes to have a replacement within weeks for its ousted former head, Peter Robinson, who was recently forced to resign over allegations of financial irregularities.

Sources within the society said yesterday: "We would hardly be looking for a new chief executive if we were that desperate to enter into takeover talks with anyone. Apart from anything else, it would make it much more difficult to attract someone of the right calibre."

Woolwich's search comes as it admitted yesterday that several potential suitors have contacted the society since Mr Robinson resigned earlier this month.

It said that its aim was still to proceed with a planned pounds 3bn de-mutualisation and stock market flotation next year.

"Since we announced our proposal in January we have had several approaches from companies asking if we would be interested in partnership or closer co-operation," a Woolwich spokeswoman said.

"We have had no formal offers from anyone," she added. A society source confirmed that Prudential, which has long stated its ambition to take over either a building society or a life company, had made an informal approach.

The society described as "pure speculation" reports that it has approached several life insurers to discuss taking them over.

However, Woolwich is known to have contacted Scottish Amicable since the announcement of its own flotation in January. Industry sources said that several other mutuals had also received calls from the society.

Michael Tuke, finance director at the society, said: "The board of Woolwich continues to plan for conversion next year. We hope to have identified a new chief executive by the end of next month.

"Obviously, we have the time to make an appointment, but the sooner an announcement is made the better. That would help stop speculation about the future of the Woolwich."

Mr Tuke, who is due to retire within the next few months, said that there had been no "formal approach" by Prudential or any other likely bidders. He added that he was still working on details of the flotation.

His decision to retire a few months early followed an agreement with the society that it would need a new finance director beyond the immediate period after the flotation in mid-1997.

The turmoil at Woolwich comes amid increasing speculation it may not be able to reach its planned flotation date in a year's time without facing at least one serious takeover bid. Potential bidders have included several European insurers and BAT, the tobacco giant.

Prudential is another contender. But one industry insider expressed surprise yesterday at its interest in Woolwich: "I would have thought that in terms of fit, such as telephone banking, diversification and its ownership of Girobank, the Alliance & Leicester would be a far better target."