A
few years ago when the Qatar Investment Authority (QIA) bought the Harrods
Department Store, it was merely from the Egyptian Mohammed Al Fayed for a cool
1.5B pounds sterling. It was rumored yesterday that the QIA is mulling the
takeover of the famous British Institution of Marks & Spencer with famously
Jewish roots for a cool 8B pounds.
When
people in the UK talk about Jewish business interests, they usually firstly
come up with the Rothschild’s bank and then the Marks & Spencer department
store. This chain of clothes retailer that ventured out into food, has had a 10
year history of ups and downs, not knowing how to position themselves in the
retail sector.
I
still wear many clothes bought between 10 and 20 years ago from this store,
which is a testament both to its success and also to its failure to adapt to
market needs. They marketed quality products, that last a long time, but their
styles though undated, and can be worn today, will not be considered to be
contemporary or with the times. They have used various designers for their
clothes lines, but were never able to hit the mark.
In
the underwear stakes, I am sure they still command a dominant position even today,
but their inability to grow as a market demands on a product line that does not
seem to grow in demand has been its downfall. In retrospect if they chose instead
to maximize profitability and ensured quality at a reasonable price without trying
to be all things to all people, I am sure would have succeeded. However no growth,
big dividend and well run does not seem to be part of what the investors want! I
have even audited this company way back when I was in Audit, where our particular
team was responsible for the audit of this august institution, and I remember the
audit partner then, Tony Wechsler, of good Jewish stock and a man I had long conversations
with, he had a unique conversational style who almost lived behind the head office
in his London apartment off Oxford Street.
It
is the sign of the times, that the Qataris mean business and are aggressively investing
their Oil and Gas fortune in Western companies to diversify their investment portfolio
as a means of future income when the Petroleum Reserves die out.
It
is heartening to note that mature economies are able to permit foreign ownership
of their assets, as it will in the end ensure the survival of a good business!
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