Clause 20 - Duty to make references in relation to completed mergers
Enterprise Bill
9:30 am
Mr Ken Purchase (Wolverhampton North East, Labour/Co-operative)
I wish to make a short intervention on the question of whether the OFT ''shall make a reference''. The exclusions are very comprehensive, and narrow the opportunity for the OFT to make such a reference. There may be circumstances that, while falling foul of those exclusions, would, in the minds of the members or the director of the OFT, suggest that a reference ought to be made.
I agree with the hon. Member for Twickenham that often the only beneficiaries of what not too long ago we used to call merger madness were the fee takers from the City firms of accountants and solicitors. Others who know the west midlands will share my view that the beginning of the end for the Goodyear plant in Wolverhampton was the attempt by the Goldsmith empire to take over the Goodyear company. Ten or 15 years ago, it cost Goodyear £60 million to ward off that takeover bid.
There is a view, which I regard as perverse, in the City that takeover activity keeps managers on their toes, but the overall effect has been unhelpful to British industry, and particularly productive industry. Rather than widening the exclusions, the idea of using some force—the OFT ''shall make a reference''—is right. I should not like to see that narrowed in any way.