I note that the FT has reported that the SRM hedge fund has increased their stake in Northern Rock in an attempt to block the takeover by Richard Branson.
Quite right too. Branson should be blocked. He might play the white knight, but let's be serious about what he'll do to strip profit before any return is made to the existing shareholders.
First he'll charge considerable fees for use of the Virgin name. Which fees will, no doubt, be paid to the British Virgin Islands where no tax will be paid.
And second he'll charge considerable management fees. Which will, no doubt go to the BVI.
Then he'll charge premium rates on his loans to the bank. After all, the Bank of England is, so why shouldn't he? And you can be sure that the return will be paid to the British Virgin Islands.
Which is where, no doubt, he'll register his shareholding so that when the time comes to sell the bank on, as it will, there will be no capital gains tax paid on any gain.
No doubt I've missed a trick or two as well. Like probably trading some tax losses into the Rock at full price or the like.
An all this whilst he will do all he can to reduce accountability as far as possible. As he has done with Virgin Atlantic, which no longer puts its accounts on its web site or Virgin Trains where the press office could not even identify their UK holding company when I called them earlier this year, and certainly could not supply its accounts.
Branson is not a white knight. He's a tax stripper. The cost will be to the UK government, the very people who he will rely upon to provide the real equity in the form of guarantees for depositors and ongoing loans to provide mortgages in the bank he wants to buy at a knock down price to continue his normal trading modus operandi.
So who will be subsidising his increase in wealth? We will, of course. He must be laughing, all the way to the bank.
Why does the Treasury fall for him?