Mr Thompson and Mr Cohrs will be responsible for primary international equities at the combined Morgan Grenfell/ Deutsche Bank investment bank, and will report to Guy Dawson, head of Morgan’s corporate finance division.Analysts see Morgan as being well placed to build a leading London equities house by hiring individuals and teams because there is so much movement by top securities people at the moment.Nomura, the Japanese securities giant, sacked 16 equities people a fortnight ago.. Mr Holmes spent 19 years with Hoare Govett, and was head of Morgan Grenfell Securities when it was closed down in 1988.He then joined Morgan Stanley for two years, before attempting to set up a brokerage boutique with Peter Quinnen, formerly of James Capel. When this failed to take off he joined Credit Lyonnais Laing.A spokesman for Warburg said yesterday: “We think he’s an excellent UK equity salesman and a proven team builder.”The current head of UK equity sales, George Pilkington, will stay as part of the team.The spokesman refused to speculate on the level of bonuses Warburg will be paying this year, despite the bank’s profit warning on Monday. Warburg’s 5,000-odd staff will be notified of their March-year-end bonuses in April, and will be paid in July.Following recent excitement, including the departure of Lord Cairns as chief executive and eight other employees, the spokesman observed: “No one has left today.”It emerged yesterday that the driving force behind Morgan Grenfell’s hiring of Maurice Thompson and Michael Cohrs from Warburg was the urgent need to build a team for the imminent Deutsche Telekom flotation.Morgan is the leading member of three global co-ordinators of the float, one of Europe’s biggest privatisations. The move is the first high-profile recruitment by Warburg since it lost the joint heads of equity capital markets to Morgan Grenfell last week.
Mr Holmes, 51, left Credit Lyonnais Laing after a furious row with Michael Kerr-Deneen, chief executive.
John Holmes, who left as head of Credit Lyonnais Laing’s institutional sales on Monday, joined SG Warburg as head of UK equity sales yesterday. SBC also holds about 5 per cent of Northern, again as a market-maker.Yorkshire declined to comment on the situation Its shares rose to 884p from an opening price of 811p. Shares in Northern closed up 116p at £10.91p, compared with the Trafalgar cash offer of £10.48.There has been speculation that Hanson is poised to bid for Yorkshire or another regional electricity firm. Other potential predators are rumoured to include Electricite de France, the French utility, and large global energy firms.Trafalgar’s bid for Northern is expected to pass another hurdle today when Northern’s shareholders vote on whether to remove the ceiling that stops a single shareholder from holding 15 per cent or more of the company.Comment, page 33. The other obvious candidate is Yorkshire Electricity, in which Swiss Bank Corporation has an 8.5 per cent stake.SBC, which is advising Trafalgar on the bid for Northern Electric, has consistently told Yorkshire that it holds its stake as a market-maker. Professor Littlechild met Trafalgar House yesterday to discuss the matter but has not said what the change will be.City analysts predicted an upside of up to 25 per cent for shares in the industry.
The consensus is that the next most likely takeover targets include smaller regional companies including SWEB, which operates in the South-west, South Wales Electricity, Manweb and Seeboard. There must be cast-iron guarantees to ensure that domestic consumers do not end up subsidising the Trafalgar House side of the business,” he said.Trafalgar House has given undertakings to Mr Heseltine that, should the bid succeed, the core electricity business will have the management and financial resources it needs.The group has also promised that Professor Littlechild will be given all the information he needs to carry out his regulatory role and that Northern will be given “appropriate financial separation and financial independence”.Because the undertakings are not legally enforceable, there will be related changes to Northern’s licence that are enforceable. Given that the electricity companies are already cash-rich it is hard to see what is in it for consumers. Robin Simpson, head of policy at the NCC, said that the bid should be referred because it was the first takeover in the sector and because Trafalgar House was not a public utility service.”This takeover sets a precedent and demands strenuous screening. Although the consensus was that no referral could be made on competition grounds, there was a widely held view that there might be an investigation in the interests of the public.The NCC attacked the decision as “deeply disappointing” and lacking in common sense. Jack Cunningham, shadow secretary for trade and industry, said the decision not to refer the bid was “extraordinary and deeply unsatisfactory”.”Mr Heseltine’s failure to intervene has left the door wide open to further bids for regional electricity companies without regard for the public interest,” he said. Michael Heseltine, President of the Board of Trade, decided not to ask for an inquiry by the Monopolies and Mergers Commission in spite of advice from Professor Stephen Littlechild, the director-general of electricity supply, that the bid should be referred.
Mr Heseltine said he acted on the advice of the Office of Fair Trading and was seeking assurances from Trafalgar House that would alleviate Professor Littlechild’s concerns over future regulation of the industry.Mr Heseltine’s move drew sharp attacks from Labour and from the National Consumer Council.
