Risk and return: Investors need keep watch on growing globalisation As mergers continue to drive the market, British businesses are now being pushed to the sidelines

Big deals are now the main driver of share prices. Almost anything goes in the London market and ownership of successful businesses is more often than not going abroad. It is no coincidence that British banks, strong gainers in the latest market surge, have become hugely profitable. They have not so...

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Bibliographic Details
Published inThe Guardian (London)
Main Author Stoddart, Robin
Format Newspaper Article
LanguageEnglish
Published London (UK) Guardian News & Media Limited 17.04.1999
Subjects
Acquisitions & mergers
Business conditions
Economic impact
Foreign investment
Global economy
Stock prices
UK
United Kingdom
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Summary:Big deals are now the main driver of share prices. Almost anything goes in the London market and ownership of successful businesses is more often than not going abroad. It is no coincidence that British banks, strong gainers in the latest market surge, have become hugely profitable. They have not so much avoided taking major project risks as lost out on choice opportunities, having for the most part drawn in their horns overseas. In investment banking they have virtually given up as providers of corporate ideas and long-term risk capital. It is hardly surprising that, with or without more amalgamations, their competitive intentions are under official investigation. Risk-taking is still crucial to national economic growth and success. A high proportion of Britain's expanding and rapidly changing businesses are run by American, Swedish, Irish and German managers. Language is clearly an important factor, but knowledge of American business methods is more important. All but a select few of important old British companies that ventured into the US market suffered heavy losses when they had to withdraw. Old quality icons like woollens and drinks are now among the main sufferers. In the process, the lack of wider managerial experience has become more pronounced.
ISSN:0261-3077