Merger by Scholl gives chairman a fourth fortune

SCHOLL, the company famous for producing anything from wooden sandals to corn plasters designed to soothe weary feet, yesterday announced a pounds 691m merger with Seton Healthcare, Britain's largest supplier of continence treatments.

It also emerged that Stuart Wallis, Scholl non-executive chairman, is to make his fourth fortune in three years. He stands to receive pounds 1m from Scholl after the merger is completed as part of an incentive plan. The deal caps a busy few months for Mr Wallis. He was instrumental in floating LLP, publisher of Lloyd's List, and has shares worth more than pounds 2m in the group. He also made a substantial sum this year for his role of selling Sheffield Forgemasters, the engineering group which was embroiled in the Iraqi supergun scandal. His recent gains come on top of the pounds 2.5m he is said to have made when Fisons, the drugs group, was bought by Rhone Poulenc in 1995.

Mr Wallis will retain his pounds 100,000-a-year position at the merged healthcare group. Scholl's other directors also stand to make hundreds of thousands of pounds from share options to be crystallised on completion of the deal.

The merger will lead to up to 280 job losses and the closure of Scholl's head office in Luton, saving millions of pounds for the combined group.

Seton produces products such as Deep Heat, Woodward's gripe water, Meltis cough mixtures, head lice treatments and bandages. The fast- expanding group has recently bought Resolve, the hangover cure, and ThackrayCare, UK market leader in urinary bags.

Seton, with most of its business in the UK, plans to use Scholl's international network to expand overseas. The combined group, to be called Seton Scholl Healthcare is likely to look for further acquisitions and could have another pounds 150m at its disposal. It will be the third largest supplier of over the counter products to pharmacies in the UK. Shares in Seton rose 68.5p to 448.5p and those in Scholl jumped 45p to 708.5p. Seton shareholders will own 53.1 percent of the group with Scholl shareholders receiving 63.88 new Seton shares for every 100 shares they hold.