Page 22 - Stakis A Case Study

Man banking subsidiary and the Macclesfield-based Plan
Investment Group also acquired at this time.

Earlier in 1987 Stakis became the first Scottish company to

take advantage of the Sterling Commercial Paper market.

This market was set up in London in 1987 and allows

merchant bankers to act as brokers between companies

wishing to deposit or borrow cash, a facility which has

existed in the United States for a number of years. Frank

O'Callaghan, then the group financial director, said that the

entry into the market allowed the company to broaden its

source of funds and provided it with a presence in an
increasingly important market. Further borrowing facilities

would be available of up to £50 million at competitive rates

for short term borrowing of from seven days to one year.

Poor performance by the stockbroking subsidiary, Robert

Wigram and Co Ltd, in the wake of the stock market crash

of October 1987 led Stakis to evaluate it position. Wigram

had lost £750,000. Andros Stakis commented, "We don't

like stockbroking." Grosvenor Insurance also

under-performed and in this case its United States equity

portfolio was blamed. The decision to dispose of much of
the finance interests of the company was taken in March

1988, although no disposal was made until after the end of

the 1988 financial year.