Bottom Line: Williams shows how

AFTER abandoning pre-acquisition provisioning about 18 months before it is officially outlawed, Williams Holdings is demonstrating how the new rules could affect predators' behaviour.

In the 1980s, acquisitions were all about restructuring. Conglomerates were happy to take on poorly run companies, secure in the knowledge that the costs of rationalising them could, in effect, be treated as part of the purchase price, leaving profits of the combined group to continue inexorably upwards.

New accounting rules likely to come into effect at the end of the year mean that all companies will be forced to take restructuring charges against profits, whether acquisition-related or not. That could encourage predators to wait until their targets have completed their own rationalisation programmes - and incurred all the costs - before making their move.

Nigel Rudd, Williams' chairman, insists he has been watching Corbin and Russwin for two years and would have bought it at the first opportunity, rationalisation programme or not.

But there is little doubt that the dollars 3.5m or so Corwin has spent on restructuring will mean that Williams can report rather better results than if it had to take these charges itself.