Week Ending: When Plan B is not Plan B
IT has been a humbling week for the Co-operative Group, after it was forced to back down on its original rescue plan for the Co-op Bank and agree to a new deal that will see it hold just 30% of the shares when the lender floats.
Former chief executive Peter Marks described this as a “tragedy” when he appeared before the Treasury Select Committee which is looking into the Co-op’s failed bid for more than 600 Lloyds branches.
And it is certainly a great loss for the Co-operative movement and those who chose to bank with the Co-op because of its famed ethical principles. The group’s chief executive Euan Sutherland said these principles will be protected and enshrined within the bank’s constitution.
But this may not offer enough reassurance to those who know the deal was forced by two bond holding US-based hedge funds, Silver Point and Aurelius, which will be influential shareholders when the bank is listed.
The deal represents a humiliating climbdown for the Co-op’s senior management who attempted to force bond holders to back its plan by saying there was “no Plan B”. The alternative, warned the Co-op, was complete failure or a Government bailout. In this case there was another plan, perhaps it just wasn’t known as Plan B.
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In Liverpool on Tuesday Week Ending was struck by the unsentimental attitude of one property agent towards the city’s magnificent listed buildings.
His view was that so many listings prevent the city’s future development because buildings can’t be torn down and replaced with the modern offices that today’s occupiers want.
Liverpool is said to have more listed buildings than anywhere outside London and the city is often divided in terms of how they should be treated. Many lie empty and will probably never be used as offices again. One saviour has been the city’s booming hotel market. A good example of this is Albion House, the former headquarters of White Star Line – operators of the Titanic – on The Strand.
Signature Living, based in the city, is buying the listed building and wants to turn it into a Titanic-themed boutique hotel. This is an obvious, but as yet overlooked, use for a building that was at the centre of a story that has global interest.
But maybe listed buildings in Liverpool and elsewhere in the UK could be helped by German-style tax incentives. There are already some tax breaks, such as an exemption on business rates in the UK, but in Germany investors in the preservation of heritage assets are eligible for income tax relief. The film industry was given a shot in the arm by such a measure. Why wouldn’t it do the same for listed buildings?
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While in Liverpool I visited Stuart Keppie and Andrew Byrne at the property agency Keppie Massie (not the one mentioned above). It was intriguing to learn of the role their firm’s head office building played in the American Civil War. Now called Alabama House, a Confederate flag hangs on the wall in reception.
In the 1860s it was the UK office of American cotton trader Frazer Trenholm and became the unofficial Confederate embassy after Commander Bulloch of the Confederate Navy arrived in Liverpool. He was seeking boats and munitions due to a blockade on Confederate ports and had one ship made at Cammell Laird which was crewed largely by Liverpool sailors.
The story brought to life the impact this far off conflict had on the North West due to the cotton trade. The port at Liverpool was bringing in nearly all of the cotton that was fuelling the growth of the Lancashire mills. The blockade in the US caused the cotton business to collapse and created severe hardship for many mill workers.
Many were sympathetic to Bulloch’s cause in Liverpool and Manchester, but others were also acutely aware that the cotton they were processing had been picked by slaves. Following a meeting in Manchester in 1862 the city issued its support to Lincoln whose reply now stands at the base of a statue of the President in Brazennose Street. As for Commander Bulloch, he never made it back to America and lies in a Toxteth cemetery.
