Due Diligence: A Thriller (27 page)

“Just spit it out, Andy.”

“There’s concern about your share price.”

“Because of Friday?”

Bassett nodded.

“Lyall,” said Wilson, “what was the closing price in New York yesterday?”

“Fifty-point-four-five,” said Gelb.

Just as Pete Stanzy had predicted, the stock price was back up to where it had been after the results. In fact, it was a few cents higher. Amanda Bellinger had done her work well. There was barely a journalist or an analyst of note she hadn’t reached over the weekend.

“Which makes it…” Wilson prompted Lyall, just to make sure that Andrew Bassett thoroughly grasped the point.

“A dollar thirty up on the price when we reached agreement last week,” said Lyall.

Wilson spread his hands. “A dollar thirty up. A dollar thirty
up
from where we were.”

“That’s equivalent to an extra two hundred twenty million on the acquisition price,” added Gelb, in case the men on the other side of the table couldn’t work it out for themselves.

Bassett frowned. Wilson watched him closely. The frown seemed genuine. It got deeper. Bassett looked as if he were in some kind of actual pain. From their previous meeting and phone conversations, Wilson had already gotten the feeling that Bassett was the kind of guy who disliked confrontation, who hated being in a position where he had to disappoint someone. The kind of guy who was more comfortable sharing a joke about the loss of poor old Concorde, and can’t we just pretend there’s no conflict between us? Now Wilson could see it confirmed in front of him. It was the right move, to come over to London and face him physically at the table. Absolutely the right move. A guy like that had to be confronted. Once he was, he could easily swing to your side just to get the comfort of conciliation.

“We still have a problem, Mike.” Bassett said it reluctantly, not looking at Wilson. Then he glanced up at him.

On the other hand, maybe he was simply a very, very shrewd negotiator.

“What’s that?” asked Wilson coolly.

“Mike, I said to you yesterday … it’s the volatility.” Bassett shrugged, as if he wished he didn’t have to say it. “We would have been happier—I mean, my board would be happier—if the share price had stayed flat. This way, it’s gone up and down fifteen percent in three days. When the offer price has this much stock in it, that’s an issue.”

Wilson stared at him. He had to stop himself from slamming the table in frustration. Even after the
Herald
slur, the price was up on where it had been before the quarterly results. So what was Bassett saying? That he would have preferred the price to be lower? It was a dollar thirty up. How could anyone, anywhere, figure that was a bad thing? It was an extra $220 million for his shareholders, right there, sitting in his hand!

“Mike, look at it from our side,” said Bassett plaintively.

“You can have a collar,” said Wilson. “We can do that, right, Lyall?”

Lyall nodded. They had discussed this on the flight over, and since it didn’t involve any more cash, Pete Stanzy had agreed. “Sure. Let’s say ten percent. If our stock price goes down more than ten percent, we renegotiate the stock swap.”

Bassett didn’t say anything.

“Andy?”

“If we announce, Mike, we’ll be in play.”

“Yeah, but with a floor of twelve-point-five billion! Twelve-point-seven, actually, with the extra one-thirty on the stock price.”

“With respect, not if your share price falls,” said Oliver Trewin. “Say it goes down ten percent between now and completion of the deal? Our floor is eleven-point-six.”

“No, it’s not. We renegotiate the swap. We just told you that.”

“Say it goes down fifteen percent, our floor is—”

“Jesus, it’s not
going
to go down!” yelled Wilson, and this time he did hit the table. “You’ve had one scurrilous, anonymous report, possibly concocted by someone to do exactly this—to put a hit on the stock price and make you block this deal—and you fall for it. Hell, you just fall straight in!”

Bassett and Trewin glanced at each other. “With respect,” said Trewin again. “This isn’t the first hit, as you call it, that your share price has taken. There was another at the beginning of the year.”

Wilson stared at Trewin, as if to ask who invited him to the meeting. But the other man didn’t flinch. Oliver Trewin was a tall, distinguished-looking man whose every word was a study in charm and civility. But rewind forty-five years, and he had been an officer in the SAS. Borneo. He knew a thing or two about playing rough. Besides, one way or another, either with a deal or without, he was leaving BritEnergy. He had nothing to lose.

“Listen,” said Wilson, and he talked straight at Andrew Bassett, trying to cut Trewin out of the conversation. “You should ask yourself why this article appeared. You should ask yourself who it’s aimed at. If you ask me, it’s aimed at you, Andy.”

Wilson paused, letting the point sink in. He could see that he had Bassett thinking now.

“You’re being suckered, Andy. Think about it. Someone does this, you walk away, you want to know what’s going to happen next? The very same person leaks that you were about to cut a deal. You know what? You’re still in play, but this time you’ve got no floor. Hell, forget twelve-point-five. Forget eleven-point-six. You’ve got nothing.”

“We’re not walking away, Mike,” said Bassett. “We never said—”

“No? You may be a lot closer to that than you think.” Wilson stared pointedly at Bassett, making sure he got the message.

Bassett glanced uneasily at Trewin. Anthony Warne, taking notes on the other side of him, put down his pen.

“Now, I’m going to ask you something,” said Wilson, still gazing straight at Andrew Bassett. “I’m going to ask you straight, Andy. Because I want to do this deal. I’m here to do it, understand? So I’m going to ask you. Are you shopping yourself around? Is Morgan Stanley out there shopping you around?”

“No,” said Bassett.

Wilson kept his eyes fixed on him. “This deal is not going to sit here stewing while your investment bankers go looking for a higher bid. You understand me? This is not an open offer. It’s not indefinite. You think about whether you want to lose that. Twelve-point-five billion. Think about it. Twelve-point-five billion. Do you really think you’re going to do better than that?”

“Mike,” said Bassett. He took a very deep breath and let it out slowly. “This is a very attractive offer. We understand that. We appreciate it. And I promise you, we are not looking for anybody else. We do not want to be put in play. Before you approached us, we weren’t looking for a deal. You know that.”

“Are you telling me that’s not what Morgan Stanley’s telling you?” demanded Wilson. “You telling me they’re not saying they can get you a higher offer?”

“I don’t think we should discuss Morgan Stanley,” said Trewin.

“Andy?”

“I think, if we can just have a few more weeks…”

“A few more
weeks
?” said Wilson incredulously.

“If we can just let things settle down for a few weeks … so the board can see that the volatility’s gone, everything’s stable, then I think there wouldn’t be any—”

“Forget it,” said Wilson. He got up. “Come on, Lyall. Stan.”

Bassett looked at him in shock. “But…”

“You don’t have a few more weeks.”

“All I’m saying—”

“You don’t have it! You’ve got today!”

Lyall Gelb looked at the men on the other side in alarm. Wilson had gone too far, he was sure.

“But … why?” asked Bassett.

Lyall froze. That was the question, the one they didn’t have an answer to. Not one they could give, anyway. He waited to see what Wilson would say. Like everyone else. On the other side of the table, the three men were watching Wilson intently.

“You can’t keep the secrecy together that long,” said Wilson.

“But no one outside this room—”

“I’m not a patient man. Right or wrong, that’s not how I am. You’re not the only company we’re looking at. The fit’s great with you, you know it is, but there are others. So if you’re not interested, get out of the line. Now, you have twelve-point-five billion on the table.” Wilson leaned forward. He tapped the table with the flat of his hand a couple of times, as if the money were sitting right there in front of them. Then he looked at his watch. “It’s here until twelve noon today, then it’s gone. If you think you can get a better offer elsewhere, I suggest you get up and leave right now.”

Bassett and Trewin exchanged a glance.

Wilson watched them closely. He had them, just about. Or did he? Maybe he shouldn’t have said they had until twelve o’clock. Suddenly he sensed that if Andrew Bassett and Oliver Trewin got up and walked out, as he was daring them to do—even if they said they just wanted to go away and think about it until noon—they were gone. He had to keep them here. And Trewin, he knew … Trewin would want to get up. And Bassett … Bassett …

Bassett was about to say something.

“However, I do think your board is going to need reassurance,” said Wilson abruptly. “After the volatility, I can understand their concern. Andy, I want to make sure you’re in a position to give them that.” Mike Wilson sat down. “This deal is exceptionally strong. I don’t think there’s any question that the price we’ve offered is very generous.”

“Mike,” said Bassett, “this isn’t about trying to get more—”

“I am, however, prepared to raise the cash component of our offer.”

Lyall Gelb stared at Wilson. Along with everyone else in the room.

“Our original offer was four-point-two in cash and the rest in stock. I think we can raise that to fifty-fifty, don’t you, Lyall?” As he said it, Wilson turned calmly to Lyall Gelb.

“Umm … ahh…” Gelb was lost for words. Fifty-fifty? That was 6.25 in cash—$6.25 billion in cash that they were going to have to raise.

“Andy?” said Wilson, turning back amiably to Bassett, like a man who knows he’s just offered something too good to be refused.

“I think that would make a considerable difference to our board’s view,” said Bassett slowly.

Trewin’s expression remained set. Mike Wilson glanced at him and saw it.

Wilson stood up. “There’s a couple of things I’d like to discuss privately with Andy,” he said. “I wonder if you could give us a few minutes. Lyall? Stan?”

Lyall and Stan got up.

Trewin shook his head. “I believe we were going to have until twelve—”

“Andy?” said Wilson, cutting across Trewin’s protest.

Bassett nodded. He looked pointedly at Trewin. Anthony Warne stood up. Slowly, Oliver Trewin got up from the table as well.

*   *   *

They stood in a small, uneasy group outside the closed door of Mike Wilson’s suite.

There was an awkward silence.

Trewin looked at Lyall Gelb. “Doesn’t have any inhibition letting people know what he thinks, does he, your Mr. Wilson?”

“Mike usually gets what he wants,” replied Lyall guardedly.

“Yes,” murmured Trewin. “I shouldn’t wonder that he does.”

Silence again.

Anthony Warne whispered something in Trewin’s ear, and Trewin nodded, and they moved off down the corridor. They stopped farther away and began to talk about something.

“You didn’t know that was coming, did you?” said Stan Murdoch. “Raising the cash stake?”

Lyall Gelb didn’t reply.

“No. Didn’t think you did.”

None of them knew how long they’d be waiting, so they stayed in the corridor, Trewin and Warne at one end and Lyall and Stan at the other. Lyall and Stan felt awkward. They had never been close—they were too different in their outlooks—and the role Gelb had played in the deal had eroded the small amount of trust Stan did have in him. Soon Murdoch pulled out his cell phone and started talking to one of his plant managers in Europe. Gelb got out his phone and gave his finance director in Hungary a call.

Almost half an hour had gone by when the door to Wilson’s suite opened again.

“Come in, guys,” said Mike Wilson.

They filed in, wondering what they were going to find.

Bassett was sitting where he had been when they went out. Wilson gestured at the table. “Take a seat,” he said to them. “Sorry about asking you to wait like that. Andy and I had a few things to run over.”

Bassett nodded. He looked very pleased about something.

“To summarize,” said Wilson, when they were sitting, “we’re at twelve-point-five, fifty-fifty cash and stock, and we announce Friday week.”

“Friday week?” said Anthony Warne in surprise. “But we were going to announce on the following Monday. And we’ve lost two days!”

“Anthony,” said Bassett. “It’ll be perfectly all right. We’ll manage.”

“Any other points?” asked Wilson. “Any questions?” He looked around.

“Gentlemen?” said Bassett, avoiding Oliver Trewin’s eyes.

They waited.

“Good,” said Wilson. “Then the only question I have is whether it’s too early for champagne.”

27

Anthony Warne sat in the front passenger seat of Bassett’s Bentley. Bassett and Trewin were in the back. There was silence between them all the way to the office on account of the driver.

When they got back, Oliver Trewin followed Bassett into his office. Uninvited, he sat down.

“You think you’ll enjoy working for that man?” he asked.

“It won’t be forever,” said Bassett. He leaned on the edge of his desk, as if to make clear to Trewin that he needn’t bother settling in for a long conversation. “Besides, I think Mike Wilson is a very pragmatic man.”

Trewin wondered what had been said during the time when Bassett and Wilson were closeted together.

“You seem very confident about this deal, Andrew.”

“Why shouldn’t I be?” replied Bassett. “The logic is sound. Just as sound as it was when we agreed to it last week.”

“Call me old-fashioned, but I do rather take a step back when someone ups the price they’re offering before I’ve even said no.”

“They didn’t up the price.”

Trewin looked at Bassett knowingly. Increasing the cash component was just as meaningful. “I only hope the combined company can service the debt,” said Trewin.

“Well, that won’t be your concern, Oliver, will it? Their finance man seems relaxed about it.”