The Guardian from London, Greater London, England • 15

Tuesday December 22 1970 15 For Saving, Investing and House-Purchase HALIFAX BUILDING SOCIETY Tltere are no finer springs than springs by IBI LfSMESS GUARDIAN Robert Riley Ltd. Guardian City Office 831 Salisbury House, London Wall E.C. 2 Economics Editor, Anthony Harris mi Vickers' deputy quits isms of easier Industrial Correspondent Robert Fraser making issue Treasury view of MR la 1 1 Macdiarmid announced his resignation yesterday as deputy chairman of Vlckers, less than a year after joining it from the British Steel Corporation. Although Vickers stated that the resignation was due to personal and family reasons," it immediately started speculation about Mr Macdiarmid's future. At the British Steel Corporation, Mr Macdiarmid, an outspoken critic of nationalisation (he once said that the industry would rise again like a phoenix from the ashes), was regarded as chief pretender to Lord Melchett.

the chairman. His resignation yesterday means that a man of huge experience in steelmaking is now available at a time when Vickers denied yesterday that there had been any personality clashes or differences over policy. It said that it had reluctantly accepted Mr Macdiarmid's resignation, and it was expected that this would take effect early in the new year when he has completed various assignments on which he is at present engaged. Last week Sir Leslie Rowan denied reports In the City that the company was faced with liquidity and profits problems, by stating that the company would make a profit for the present year. from the British Steel Corporation, where he was managing director of operations and supplies.

He has been a colleague for a long time of Mr Macdiarmid, who was his boss when both men worked for Stewarts and Lloyds. The most likely reason for Mr Macdiarmid's resignation was that the appointment of Mr Mathews meant that he would no longer become both chairman and chief executive when he succeeded Sir Leslie Rowan as he had expected when he took the post. pie economy about half the total of new funds made available, and the authorities seem satisfied with that. It is a good way short of a money squeeze. In hard figures, lending to restricted private borrowers fell somewhat in the latest period.

The movement of net advances and commercial bill holdings leaves a net rise of 3.7 millions in bank finance, but the nationalised industries took 5.3 millions and lending outside the restricted classes (export loans, housing loans, and so on) also rose. So there must have been a balancing fall in restricted lending. But the total fall in advances was less than usual at this time of year, which leaves possibly just a slight movement upwards" in restricted lending on a seasonally smoothed basis. Kestricted lending by the anks probably rose sightly a a seasonally adjusted asis in the three weeks up December 9, in spite ot an jasing of the money position, amlv due to tne inflow ot linds from abroad, which Biabled bank deposits to rise fly nearly 73 millions. These tacts suggest mat tne nks are being less than ronous with their customers, the authorities greeted the femes with a smiling display Christmas goodwill.

The total expansion of lend- ig, in the official view, is now i line with policy as for the sc in bank liquidity, which as risen Dy a lurtner halt bint to 33.8 per cent, this laves the banks nicely poised the revenue quarter." This response offers pretty ear confirmation that the reasurv is now pursuing a Ither relaxed policy of onomic management. The continued rise in money pply, although financed by foreign inflow, would De an arm signal if a restrictive llicv was being followed. But hen a more relaxed policy is Ioptcd, such a rise can be nored by talking in terms of pmestic credit expansion ther than money supply (a reign inflow does not count domestic credit, although it ntributes to the money ipply). This option has always been en, since the only official rgets are still those laid down Mr Roy Jenkins in April, men covered aomestic credit pansion in general and the ansion of bank lending in rticular. The implied policy for money was contained in a and Sheffield of EjffiUsh EI of power equipment for this class of electric locomotives Railways- The order By VICTOR KEEGAN, the Government is closely examining the future activities of the industry.

He is 51. When he joined Vickers last January, Mr Macdiarmid was expected to take over the chairmanship from Sir Leslie Rowan in about two years time. Since then, under considerable pressure from institutional shareholders, who were unhappy with their Investments, Vickers appointed Mr Peter Mathews as managing director and chief executive. Mr Mathews also came The Trafford Park, Preston, nroduce most of the 100 sets BP plans protein plants By our Industrial Staff British Petroleum plans to build two full-scale commercial plants to make petroleum protein animal feeds in Europe, involving an investment of about 35 Millions. The company is already producing petroleum protein on a test basis.

The large-scale plants are expected to sell petroleum nrntoin fiwls at about 100 a ton, the cost of fishmeal. a common animal ieeu. rne petroleum protein feed has a mgner pruieiu tuiuwn ihh fishmeal, and has the advantage of price stability because the raw material is not seasonal Petroleum protein is pro-rliirpri hv raisins bacteria or yeast on the parafins in petroleum cuiring a iermeni-ation process. The nrn sMiarated. dried and added to other ingredients to produce a mgn-protem ieea for cattle, pigs, and chickens.

The petroleum products on which the organisms feed are actually improved by the process and are sold in the normal manner after separation. About 1,000 pounds of yeast can produce 4,000 pounds of petroleum protein in one aay, while feeding a steer adds only about one pound of protein to its weight in a day. In search of a yardstick for success Ways of measuring the potential success of business ventures are to be the subject of a study by the Small Business Centre at Aston University, Birmingham. It has been given a grant from the Social Science Eesearch Council to make a feasibility study The study will try to discover what connections there are between the background, motivation, skills, and experience of the businessman, his products, and the success of his firm measured in growth and profitability. By LINDSAY VINCENT Robert Fraser and Partners, so far the least successful of Mr Maxwell Joseph's enterprises, is making a rights issue worth 4.8 millions as the first stage of a programme to convert the company into a comprehensive merchant bank.

A stock market quotation may be sought next year. Grand Metropolitan Hotels, Mr Joseph's master company, has no interest in Fraser at present but will subscribe to the issue and finish up as the bisgest single shareholder with a holding of 23 per cent. Another of Mr Joseph's listed companies, Giltspur Investments, is now the major shareholder with 46 per cent of the equitv, but it will not be takins up its whole entitlement and its holding will be reduced to 20.4 per cent. The rights issue will be underwritten bv Mr Joseph personally. He already holds 4 per cent of the capital, but in his position as underwriter it is certain that he will finish up with a holding above this level.

Robert Fraser is already a public company with riout 1,300 shareholders. It in difficulties when it came into Mr Joseph's stable and has had an erratic record ever since. It made an ill-fated expansion move into the North in 1966 and two years ago suffered an unfortunate involvement with the Walford Merchant Banking Corporation of Jersey. When Walford collapsed. Robert Fraser had 300,000 on deposit but has since recovered 79.000 thanks to the intervention of the Slater, Walker Group.

That Mr Joseph has finally decided to expand Robert Fraser comes as no surprise. But for the Walford incident and his empire-building at Grand Metropolitan (Express Dairy, Berni Inns, and Mecca have been acquired at a cost of about 60 millions over the past year or so) it might have come sooner. Fraser's existing operation is verv small, Mr Joseph said last night, but with the 4.3 millions from the rights issue, the company is planning a comprehensive service in both investment and merchant banking. Fraser's present capital is 400.000 and the issue will be on the basis of eight for one. The price is 3s a share, or a premium of 50 per cent over par value.

Recent sales have been roughly between 2s 6d and 3s 6d. Giltspur's entitlement is around 14.8 million shares but it will take up only 5.5 million. So Grand Metropolitan will take up tho balance 9,275,760 shares. As Mr Joseph has 4 per cent, and Grand Metropolitan and Giltspur nave 46 per cent between them Mr Joseph will act as underwriter to about half the issue. Local bonds Edinburgh corporation.

Dumbarton County Council. West Glamorgan Waterworks, and the borough of Warley are to issue a total of 3.5 millions in local authority bonds. The bonds, all at 99 15-16 per cent, carry interest at 8 per cent and are redeemable on December 29. 1971. Bear market hits units By STUART FLEMING November's stock market th JJ collapse proved too much tor that the bulk of thc investment many unit trust investors.

was made by people who arc in Figures released yesterday a regular savings scheme. bythe Association of Unit he evulence ofjhe Trust Managers show a sharp unlikely now that net invest- increase in the rate at which ment the. intry wh unit holders were making Thjs cornpares with 186 repurchases. New sales are mniions in 1969 and 258 mil- also declining again, net sales iions 196S. fell to only 2.9 millions, the while the sales fiqures are lowest since August 1966, heavily depressed one report and the November figures remarked that the industry is were the worst for nine not despondent.

It has been through it several times before i63113- and always bounces back, he Sty comment I'4 By ANTHONY HARRIS puzzling observation that monev supply "might well" rise by less than domestic credit expansion this year a suggestion which has always been treated as improbafe in these pages, and which certainly does hot fit the facts of the last few weeks. The total figures for the seven weeks to December 9 are these net advances have fallen by 138.4 millions, but deposits have risen by 136.7 millions. This means that a total of 275 millions has been provided to pay off loans and add to deposits the bulk of it it now seems, through the foreign inflow, although some official buying of gilts from the public made a contribution at the beginning of the period. In short, because domestic credit expansion is back on target (it has contracted somewhat in the period), the rise in the money supply is only No quota pact yet In Washington, both the Americans and the Japanese have denied an assertion that the American textile industry blocked the approval of a tentative textile agreement between them. A Japanese Embassy spokesman said they had not reached a point of tentative agreement yet, while officials of the American Textile Manufacturers' Institute said they had not rejected any Japanese or United States plan for settlement of the trade dispute because we haven't been asked to do so." final dividend frois 3 to 5 per cent, making a total of 7, compared with 5 for the year.

There will also be a two-for-five scrip issue. The chink in the armour could be the financing of the property developments. But long term shareholders should certainly follow their chairman's advice not to part with any equity." Dependence reduced BAMBERGEKS results for the six months ended September provide yet another example of the impact a relatively small improvement in margins can have on the profits performance. An increase of about half-a-point to 3.4 per cent in margins has helped to convert an increase of 23 per cent in sales into a rise of 41 per cent to 364,000 in the pretax profit. The latest figures reflect acquisitions which have reduced the dependence on the cyclical timber merchanting market.

The timber interests which represented about 67 per cent of the business two years ago, probably now contribute about 60 per cent and it may not be too long before the division becomes even more equal. Bambergers goes into the new year with a streamlined operation designed to improve the profits potential. For the short-term, an increase of 5 points to 35 per cent in the earnings in 1969-70, may be within reach for the group, which remains confident of breaking its record pretax profit of achieved in 1968-9. On this basis, the shares are selling on a prospective price-earnings ratio of about 7.5a rating which appears cautious. Inside promotion TIMES may be hard for fund managers in America, with 20 per cent of their members joining the dole queues since the hear market began, accord; ing to "Money Management, but in Britain jobs go a begging.

-w wanontlv LWT post for Mr R. Murdoch By PETER RODGERS Mr Rupert Murdoch will become a part-time executive director of London Weekend Television after subscribing 500,000 of new capital for the company through his News of the World Organisation. He is already a member of the main board, which yesterday approved Mr Murdoch's proposals for an injection ot cash. Rights issue The capital raising will take the form of a one-for-thrce rights issue of non-voting shares. It will be offered to all shareholders but a "majority has indicated that they will not be taking up their entitlement." News of the World Organisation will be the underwriter, and if the group takes up the nrhnla Iccnn spurns nrnhnhlp i its stake In LondonWeekcnd will De raisea irom i.o per cent 1 to 30 per cent.

represent 4 or 5 per cent of total sales. American companies are increasing their efforts behind the Iron Curtain admittedly with some inhibitions about Russia itself and European companies such as Siemens of West Germany and CII of France are also working at the market. The French, in particular, have shown themselves less finnicky than Britain about the way they apply the embargo rules. On the other hand, ICL has more than 150 people selling to the Communist countries, and is one of the very few Western companies with permission to set up a permanent office in Russia. The Serpukhov order has been around for about a year, but it was not until recently that the weight of American concern was felt, exaggerated by deteriorating relations between America and Russia.

Delays of as long as a year are not uncommon when awaiting a licence to export to Russia. MARKETS REPORT Buying There was little pre-Christ-mas joy in London stock markets yesterday. Although Friday's firmer tone was carried over to the early part of the day, what little buying interest there was soon petered out and by lunchtime initial small gains had been reduced or reversed in many cases. The Financial Times index at the close was down 0.9 at 334.4. Gilt-edged securities, however, enjoyed a reasonable day's trading with some institutional support noted.

Particularly favoured were medium-dated issues, where gains extended to point. The rest of the market, although often below the best, added up to With the exception of Rank 3s higher at 133s in anticipation of a resumed advance on Wall Street, industrial leaders passed a very quiet and uninteresting day to close with a majority of trifling falls. Reports of a record Christmas spending spree helped stores, although several leaders turned back to record little change on balance. Gains held a comfortable majority among engineerings but olectricals moved irregularly. J.

Lyons 2s 9d up at K2. v.lTi- prominent among the few features arising from press mention, while Savoy A recouped Is Cu ot recent sharp losses at 5os fid. The number of bargains saj "mere is a massive educational job to be done, DeoDle must learn that when rnn: it it. ihn time t0 buy." abnonnal level of repur- chases (th totallcd 7 7 mimons) will be disturbing the nanagement groups however, espeCjany as the timing of a stock ltlarket recovery is so unceriain. The seriousness of tle position can easily be exaggerated, and there is little doubt that if share prices started to rise investors would pull their liquid cash out of the building societies and I ost Office savings accounts where it is on deposit.

But a measure of the lndus- try's difficulties is that in August ..1966 (the previous low) gross funds totalled only t37 millions, compared with the 1.344 millions at the end of last month Mote. Ihc over which the sales figure was spread has increased soon peters out the man chosen, Mr JVlark St Giles, is an investment man as opposed to the marketing man Mr Ranald proved. He has been heading the Jessel Investment team, which yesterday reported that it has seven of its trusts in the industry's top 20 performers for the first 30 week-; of the existing year. These figures are based on the weekly charts from stockbroker G. S.

Herbert. If Mv Ranald was at all unhappy abut Oliver Jessel's attitude to the unit trusts (he views them simply as large funds with plenty of "placing" power) he denies that this had anything to do with his departure. I am simply not standing for re-election next February," he said last night. Question over export AS we reported last week, Mr Heath did bring up the questio of ICL's Russian computer order, worth 6 millions, when ho saw President Nixon. The order is a vital one because it is not only a substantial part of the company's annual Communistjbloek sales, but if approved would also establish new and higher limits on the size of computer which can be exported to Russia and her satellites.

Russia is trying to increase the size limits because it needs big machines. The disputed order is for a nuclear physics centre at Serpukhov, and is believed to include 1906A machines, which are at the top of the company's range. Previously, the company has been able to gradually increase the size of machine allowed under the NATO rules which are bendable as far as the system 470, but it appears that 1906A is going too far for the Americans, although it is by no means a giant. ICL is the leading "Western computer company in the Communist block, although it is cagey about its sales there. It has already announced Russian orders worth 3.6 millions this year, and at the end of last vear it had orders worth 5 millions outstanding for the satellite countries and orders worth another tj millions for Russia excluding (he order which is now in dispute.

A single order worth 6 millions would be a vital prop to its Communist block efforts. If it could have announced the order this year, the annual result to be published today-would have been helped. The order would Temmm on stealth PROPRIETORS of Hay's Wharf is mustering its Befences against a bid. While Recognising that in the interests If shareholders there is a price fir everything, the board of 6d's W-harf is determined that lie company's valuable BroperUes will not be acquired ieaply. I There has been criticism that Bay's Wharf has been unneces-iarily secretive about its ji'opcrty assets, and this jecrcey has reinforced the fecl-jig that these assets have fllen aecidentaly into the poup's balance sheet where ic board has suddenly liscovered them.

I The board insists that it has Seen building up its Tooley street properties for several loars, that the plans for (redevelopment, which are now fell advanced, would have been ftought forward some years eo but for restrictions on flTice development, and that ecreey has been essential for pie company to acquire the Properties which are now its post valuable asset, i In the first place there were ears that the dock workers f'ould have become incensed pad they known about the property development schemes he board has nurtured over weral years. The threat of Ports nationalisation also placed I premium on 6tealth. The land that Hay's Wharf gas acquired in the Tooley Elreet area would not have fome as cheaply were it not or the quiet way in which the Lchemes have been pursued, pherc were also fears that the ana would be designated a Comprehensive redevelopment pa if there was too much publicity. This would have presented the fragmentary planning which the Hay's Wharf board has succeeded in pranging. Yesterday the company produced its profits figures for the year ended September, 1970, 'nich show the marked Improvement forecast at the of the year, with 'fofits up from 643,000 to 119 millions before tax, and rom 462,000 to 779,000 after tay.

The board is raising the INVEST IN BOROUGH OF ECCLES MORTGAGE LOANS lrV 3-' 2 YEARS MINIMUM 500 'PPly: Borough TrtHmer, Town Hall, "till, Mancliestir. 061-789 2214 Et 219 vvnne lucre vim tial variations between the individual management groups, flt inrtliQtrv suggested last night that some of the major unit trust manage- ment groups may now be running at a loss. The beai market has persisted for almost two years, longer tnan even some of the pessimists antici- pated, and for most of that period unit trust sales have been low, or declining. December's figures are expected to be no better. It is seasonally a bad month and the slock market has not recovered stronglv enough to tempt unit trust investors back.

Opinion is divided on the extent to which tUe November gross sales figure of 10.65 millions is made up of con- tractual savings such as those associated with equity linked policies. One source suggested 6d to 22s 6il. Buyers were scarce in T. B. W.

Cockayne, whose fell Is 6d to 14s, WALL STREET Share prices closed lower on the New York vStock Exchange after a da of moderate trading. The Dow Jones industrial averages closed 1 23 points lower at 821.54. COMMODITIES Joynson's index of commodity future prices in the United Kingdom stood at 120.01 yesterday, compared with 120.34 at the previous session, and 122.1 a month ago. RAW COTTON A moderately active null demand was directed mainly to forward offers of Latin American and African upland descriptions. Long staple varieties received modest support for Business returned totalled 4.200 bales.

WOOL AND TOPS New business in tops and combing wools is still depressed in Bradford, but the flow of delivery instructions for tops has shown some improvement during thc last few tlavs and the demand for wools for the woollen trade has picked up. All the same prices arc still tending to weaken. Quotations 97d for 64s tops. SOd for 5Ss super, and 61d for 50s carded. THE WIGFALL GROUP WIDENED BASE OF OPERATIONS The tweiitv-sci-ond annual general meeting of Henry Wigfall and Son Limited was held on December 21 at Sheffield In his circulated statement Mr.

it. ilearnshaw (Chairman) paid tnbute to his brother, the late Mr. Hearnshaw, who had been chairman s.uce 19o9 and had served the Company for over 45 years. Referring to the accounts, the Chairman continued: Part of the increased profit disclosed is due io the fact that we have engaged in Check Trading, which nas had the eftcct of reducing our Hire Purchase and Rental transactions. The entrv into Check Trading has been made possible through the 'facilities ofTered by Wigfall Finance Company Limited.

The effect of this has resulted in much of the profit therefrom making its appearance in this year accounts whereas, had the same transactions been conducted on a Hire Purchase or Rental basis, the profit thereon would, in accordance with our usual practice, have spread over a period of years With the exception of Dobsons (ShelSeld) Limited and Graves Mail Order Limited, the subsidiary companies have, by and large, traded satisfactorily. Every effort is being made by your Board to improve the profitability of these two companies, and we are hopeful that they may benefit from the services and advice of Management Consultants whose preliminary report is expected shortly. Since the year-end, I am happy to report that turnover has shown an increase of approximately 10. This however has been accompanied by an increase in operating and administrative costs and I hesitate to give any indication of profit at the half vear stage. I can, however, say that my colleagues and I are confident that our showing for the current year will stand comparison with our competitors, always bearing in mind that such is the diversity of our trade that one cannot truly class us with companies whose sole activity is the sale and rental of radio television sets.

marked totalled 7,594. compared with 6,539 on Friday and 7,418 the previous Monday. NORTHERN After a firm opening, rumblings in the Australian sector removed some of the shine from price levels, and the market showed signs of pre-Christmas indifference. Prices almost inevitably closed easier than at the opening, but little concern was evident. Thc weekend press was unanimous in its outlook for 1971, with Slater Walker receiving particular attention and rising by Is 3d to 36s 81d Few of the many other recommended shares could match this improvement, including British Oxygen which put on only 3d to 10s 5d, and the Midland Bank which moved up 4jd to 59s.

Leaders lost ground steadily throughout the day with few exceptions. Dunlop dropped 4 id to 25s 10ld, as did IC1 to 47s 10d, while BP gave up 6d to 90s 4d. Ultramar, however, was strong among the oils and dosed 2s higher at 71s. Dealers were at a loss to explain the recent deterioration of Hopkinsons, which after losing 3s last week declined another 3s 3d to 54s 3d Other movements Included Burco Dean which improved ahead of today's results, and put- on lid to lis ltd. L.

Kair-cloush rose by lOJd to 23s 10d. while Henry Wigfall recovered jessei xjjiiaiuiia advertised anonymously for a fund manager to replace Mr Charles Ranald, whose impending departure has now been confirmed. Not a single application of note was received, so the group was forced to look internally for a replacement. It may be all to the good, for.