Royal Doulton, the luxury goods group, is to allow shareholders to consider an alternative restructuring proposal from Waterford Wedgwood, its Irish rival. This would spare Royal Doulton“s investors …
Royal Doulton, the luxury goods group, is to allow shareholders to consider an alternative restructuring proposal from Waterford Wedgwood, its Irish rival. This would spare Royal Doulton“s investors an GBP 18.9 million rights issue. Waterford Wedgwood is understood to be pushing to buy Royal Albert, one of Royal Doulton“s leading brands, in a move that would derail a complex restructuring masterminded by Hamish Grossart, the company doctor who is Doulton“s chairman. The original restructuring plan, strongly supported by investors, was intended to return Royal Doulton to profitability by 2004. Disposing of Royal Albert would deprive Royal Doulton of one of three core brands on which its recovery is predicated. Royal Albert generates sales of GBP 30 million. It includes “Old Country Roses”, one of the most popular bone china tableware designs of all time, which has sold 100 million pieces since its introduction in 1962. The Irish business chaired by Sir Anthony O“Reilly has shown an astute grasp of tactics in making its move. Following a series of losses, Royal Doulton“s market capitalization is about GBP 10 million, less than half its debts of GBP 24.3 million and a quarter of its net assets of GBP 42.9 million. Waterford Wedgwood, which acquired a “defensive” 14.9% stake in Royal Doulton in 1999, strengthened its negotiating hand a week ago, buying another 5.7% of its rival for just GBP 500,000. The Irish group, which announced full-year losses of EUR 43.3 million at the beginning of March, intervened in Royal Doulton“s restructuring plans just ahead of an extraordinary meeting to approve the fully sub-underwritten rights issue yesterday. Waterford Wedgwood was granted a postponement of the meeting until March 15, giving time for Royal Doulton“s board to consider its offer. Waterford Wedgwood and Royal Doulton declined to comment on their negotiations.