March of the Tartan Army

THERE is plainly something in the air in Scotland. First, the fund management deal between Standard life and Aberdeen, then another independence referendum request from nicola Sturgeon and now an all- share £2.2bn bid by Aberdeenbased oil services firm Wood group for Amec Foster Wheeler.

the Wood premium for Amec shares is a modest 15pc or so. Beggars cannot be choosers and Wood’s benevolent move may have been preferable to a £500m rights issue and dividend cut at Amec. troubles at Amec partly stem from its ambitious purchase of Foster Wheeler in 2014 for £2.6bn (at the current exchange rate) just as oil prices collapsed. Just like Cobham, American adventures have cost it dearly and makes one question the quality of the due diligence.

it may well be that Wood group’s timing turns out to be much better. the oil price has recovered somewhat but as critically, the trump administration – with its steer away from climate change, its more friendly attitude to carbon fuels and interest in fracking – should be good for Amec, which earns 34pc of its income in the US and is strong on engineering and environmental services.

With a 10pc stake in Wood, Martin gilbert of Aberdeen Asset Management will be a significant player in this deal. the tartan Army looks after its own. unlike the Standard-Aberdeen deal, there is no question who will be in charge at Wood-Amec with Wood chairman ian Marchant, chief executive robin Watson and finance boss David Kemp all keeping their jobs. no mystery, then, as to where most annual cost savings of £110m will come from. game, set and match, as that other Scottish phenomenon Andy Murray might say.

Tucker return

FINDING suitable chairmen for FTSE 100 companies is hard and it is even tougher if you need formal certification from the Bank of england. even if the Old lady finds it tough to get its own ethical issues in order. HSBC has done well to find Mark tucker, who ticks most of the boxes, importantly having worked in Asia where HSBC is best in class. if there is carping to be done, it is over tucker’s brief sojourn at a fast expanding HBOS well before the crisis. tucker joins an elite who have been involved in bad banks and gone onto greater things, including DIY craftsman Sir ian Cheshire, who is to chair Barclays’ ring-fenced bank despite being on the board of Bradford & Bingley.

tucker has shown his mettle by doubling the share price of AIA, the Pacific offshoot of Aig, and as a former member of the Bank of england’s Court and director of goldman Sachs. incidentally, goldman is one of a small number of banks in london which has not bought into the Banking Standards Board which is seeking to improve the behaviour of lenders in the City.

the choice of tucker opens the way for change at HSBC. Current incumbents Douglas Flint and chief executive Stuart gulliver have faced daunting challenges.

they have been busy jettisoning a past legacy which included some terrible acquisitions including household in the US, Mexico and the Safra private banks.

it has been bloody and left behind a trail of legal liabilities mounting to pages in the annual report. in simplifying the enterprise some 42,000 jobs have gone. unfortunately for Flint and gulliver they also developed a reputation for crying wolf with their attacks on UK bank taxation, Brexit and the rest, threatening to leave these shores. if tucker can bring an end to that it will be helpful.

Departure of a chairman makes it easier to move onto a new chief executive with gulliver also following through on his promise to go. his reputation never fully repaired from disclosure that at one point his salary was paid through an arrangement which involved the geneva private bank and Panama so as to disguise it from colleagues.

An internal replacement in the HSBC tradition looks most likely with retail and wealth boss John Flint a leading candidate. hopes that lloyds boss Antonio Horta-Osorio had of moving to HSBC were almost certainly destroyed by his Singapore shenanigans. Descendants of Calvinist Scots who hold sway at HSBC do not approve.

Sparkling rewards

SHED a tear for chief executive Mark Cutifani of diamond miner Anglo American. Future share awards will be capped at 300pc of salary against 350pc previously limiting his future overall earnings at £13.1m after last year’s AGM revolt. As chairman of the pay committee board, Sir Philip hampton has failed both investors and government ambitions to curtail boardroom excess. Should have tried harder.