Leading Article: Mr Robinson's Forte flutter

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The Independent Online
Gerry Robinson, chief executive of the Granada Group, has a nose for trouble. Eighteen months ago he won control of London Weekend Television, ousting the popular chief executive Greg Dyke and freeing up an unwilling Sir Christopher Bland for an eventual role as the next chairman of the BBC. Both the bid and the way it was conducted left a nasty taste in many mouths. People wanted to know why a successful management team was dumped by institutional investors who could not be sure of the consequences.

Today Mr Robinson is locked in the final stages of a battle for the Forte Group, with its chief executive Sir Rocco Forte resisting Granada's claims that Forte is a badly managed "sleeping giant" that only Granada's managerial kiss can fully awake.

Sir Rocco's friends and supporters retort that Granada's bid will leave it burdened with nearly pounds 4bn of debt, and it will be forced to sell off the best parts of a business that has been painstakingly assembled over the years. The bid is little more than an asset-stripping operation, launched by a management with a successful but short track record.

Forte, by contrast, is a name to conjure with. Many who respect the achievement of Sir Rocco's father, a poor Glaswegian who pulled himself up from nothing, are appalled by the way this could be dismantled on the say-so of one or two large pension-fund managers. By next Tuesday we will know who has finally prevailed.

There is little room for sentiment in the City. Indeed, Charles Forte himself exploited this in the past. His business grew most prodigiously through its takeover of Trusthouse in the Sixties. Then most of the charges being levelled at Mr Robinson today were aimed at the Fortes: they were the new arrivals intent on taking over a venerable company.

There is no public interest at stake in this bid. Even though service- sector companies are far more important than they were to the economy, Forte does not rank as a national asset. It has lost the support of the City in recent years because its family management responded too slowly to calls for higher returns.

However, none of this means the bid reflects well on Granada, or the City itself where advisers, PR men and merchant bankers have been raking in huge fees. Did the pension funds who are selling out to Granada do as much as they could to pressurise Forte to change more quickly? It seems unlikely.

But the man who really has to worry is Mr Robinson. His strategy has twisted and turned as the bid has progressed. Granada will be very highly geared and, as a result, very vulnerable if he should win. Mr Robinson may well have overplayed his hand and offered over the odds for Forte in a show of managerial machismo.

If that is so, he will probably pay for his overambition at the hands of his own shareholders and the entire bid will have been a fiasco.

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