U.K. denies Aust. bias

Press, 26 June 1989, Page 30

U.K. denies Aust. bias

NZPA-AAP London Britain has defended its record on allowing foreign take-overs, amid Australian charges of a bias against Australian companies.

The Secretary of Trade and Industry, Lord Young, said there was no policy of protectionism.

“We are not in the business of saving companies from unwelcome foreign bids,” he said at the Australian-U.K. Trade and Investment Conference.

The Australian Prime Minister, Mr Hawke, giving a keynote address at the conference, called on Britain to ensure its merger policy was clear and

open, and based on economic merits. In the text of his speech, Mr Hawke said the recent referral of proposed Australian bids for British companies to the British Monopolies and Mergers Commission had created unease in Australian business circles and in his Government.

"Unnecessary uncertainties or delays must not be allowed to hamper legitimate business decisions which ultimately underpin the living standards of all countries,” he said.

Australian companies were angered when Mr John Elliott’s Elders IXL had its bid for British

brewer, Scottish and Newcastle, rejected earlier this year. It was Elders’ second time before the Monopolies Commission; the first was for a bid for food and drink group Allied-Lyons.

The Australasian food group, Goodman Fielder Wattie, also had its bid for Ranks Hovis McDougall referred to the Commission last year. Lord Young said there was no policy of protectionism in Britain. “Indeed, all too often, I am criticised at home for operating too open a system,” he said.

He said that in the last three years, only three Australian bids out of 13 had

been referred to the Monopolies Commission for investigation. “Only one was rejected,” he said. “That was Elders bid for Scottish and Newcastle — but really it was the Courage bid for S and N, for Courage was the Elders interest over here.

“ John Elliott knows, when he bought Courage he had no brewing interest here — the deal was neither referred nor stopped.” Lord Young said that of 10 mergers between Britain companies referred to the Monopolies Commission in a similar period, three were rejected.

Meanwhile British business leaders cold-shouldered a key Australian Government reason for investing more in Australia.

They made it clear during the conference that they

were sceptical about Australia as a launch pad into the booming Asian markets. Attended by about 300 Australian and British business leaders, the conference was the centrepiece of the Australian Government’s bid to increase two-way trade and investment.

One of Mr Hawke’s main arguments for more British investment was that Australia offered great opportunities to break into Asia.