§ 12. Mr. Dalyellasked the Secretary of State for Energy if he is satisfied with the advice of Messrs Rothschild's, merchant bankers, in relation to the fixing of share prices in relation to the privatisation of Amersham International.
§ Mr. LawsonI am satisfied that Rothschild's gave the Government their best advice.
§ Mr. DalyellSince, before the event, the Investors Chronicle solemnly told its readers to expect a premium of 30p over the existing share price of 142p, why was neither the Secretary of State nor Rothschild's as wise?
§ Mr. LawsonThe hon. Gentleman is characteristically wrong. The Investors Chronicle said at the time the issue was announced, the price was announced and the prospectus came out—
§ Mr. Dalyell26 February.
§ Mr. LawsonI am talking about the 14 or 15 February.
§ Mr. Dalyell26 February.
§ Mr. LawsonThat has nothing to do with it. The Investors Chronicle said that the issue was ambitiously priced.
§ Mr. Dalyell26 February.
§ Mr. ViggersWill my right hon. Friend tell the commentators who, with the benefit of hindsight, have become instant experts, that if the issue had been carried out by way of tender or even at a higher price, bearing in mind the amount of interest that was retained in the issue, the net amount received by the Government may have been less and that the issue at least had the benefit of being spread very well among smaller investors?
§ Mr. LawsonMy hon. Friend is absolutely right. It was a highly successful act of denationalisation. The taxpayer got a very fair price—19 times prospective price earnings, compared with 10½ times price earnings for the average share in the FT index and considerably less than 19 even for companies such as GEC and Marks and Spencer. The reason why the Opposition do not like it is that it was a successful piece of denationalisation.
§ Mr. Merlyn ReesDoes the Secretary of State consider that his decision on the method of sale—and it was his decision—was the right one for the community?
§ Mr. LawsonI accepted the advice given by my advisers and I take full responsibility for that. I am satisfied that there was a very successful result. I have never known so much nonsense written or spoken about anything as there has been about the flotation. The idea 594 that the price at which shares are being traded was the price that could have been secured for the offer as a whole at the first instance is a view shared by no one who knows anything about the stock market.