Meanwhile, the sale of chip designer Arm – arguably the most successful technology company Britain has ever produced – in 2016 to Japan’s SoftBank must rank as one of the greatest acts of self-harm ever committed. Rishi Sunak’s failure to convince Arm to choose London over New York to relist its shares when Softbank chose to exit last year, has only served to compound the error – with a market cap of $153bn (£114bn) Arm has tripled in value since the snub.
Meanwhile, a national predilection for selling the crown jewels of commerce and industry is almost a uniquely British affair, driven by a long line of governments who have somehow allowed themselves to be fooled into believing that this represents genuine foreign investment when of course it is nothing of the sort.
As culpable are the stewards of those companies that cave in to takeover bids at the first opportunity without any attempt to make the case for remaining independent. Why do so few management teams have the confidence to go it alone? Selling out is much easier than standing behind a strategy that has yet to pay off, or worse may be faltering. Under-pressure boards are too quick to point to their fiduciary duties to put any serious proposal to a shareholder vote.
Yet, often the so-called premium being waved in front of investors’ noses is flattered by a share price languishing close to, or at, all-time lows. The weakness of the pound is often conveniently overlooked too.
But what about a responsibility to consider the national interest, or indeed the bigger picture? Often there is greater value to be created in the long-term by maintaining the status quo.
Take Greggs, the humble purveyor of sausage rolls and other baked delights. No doubt it has had numerous suitors, but instead of leaping into the arms of an admirer it has stuck to its guns. As a result investors have been rewarded with a 30-fold share price increase over the last three decades.
High street bellwether Next, fantasy games maker Games Workshop, and heavy machinery supplier Ashtead have delivered similarly eye-popping returns by resisting the temptation of the quick sugar-rush that comes from a takeover.
With similar nurturing, there’s no reason to think that in another 30 years, the same won’t be said of Rightmove.
