07 Nov 03. BATTLESPACE has learnt that during the City Euphoria managed in such a disgraceful way by the Marconi main board, with CEO Lord Simpson and Finance Director John Mayo taking the brunt of criticism in the destruction of the UK’s leading industrial company, that the company offered incentives to the employees to hold on to the shares until they reached £16. Once the £16 had been reached, each employee holding stock at that time would be offered 1000 shares free.
Sadly for the employees the stock never reached that level and thousands were left with no savings and no pension, some reported to have lost as much as £70,000.
The company is now resurrecting itself under Mike Parton who has a very comfortable management contract, promising him a handsome remuneration on performance. Meanwhile, the government has remained silent on an investigation into the demise of Marconi which started life under the old management with £4bn in the bank and £9bn of borrowing capacity, only to be destroyed in am matter of months by a rash and irresponsible buying spree. As the FT commented at the time, when the Yanks are selling, that is the time to get out of the market. But Simpson and Mayo continued to spend, with architect of the company, Lord Weinstock powerless to stop them. He died last year, fundamentally of a broken heart, having seen his fortune crumble to a few million and his company destroyed.
Did Simpson, a Labour Peer, believe the Blair rhetoric that the U.K. would be wired up with every school having a PC or did he believe an Arthur Andersen telecom report, we shall never know. In any event he bet the company and lost to the detriment of UK Plc and thousands of Marconi employees.