Sir Eric Yarrow, Bt
Shipbuilder whose family firm occupied a mile of the Clyde waterfront but was nationalised in 1977
SIR ERIC YARROW, 3rd Bt, who has died aged 98, was only the third chairman of the eponymous, world-famous, Clyde-based shipbuilders and boilermakers. He followed his father, Harold Yarrow, and his grandfather, Alfred Yarrow, who started the company on the Isle of Dogs in 1865 then moved it to the Clyde in 1904.
Alfred Yarrow was made a baronet for services to shipbuilding during the First World War, services which the company maintained throughout the Second World War and the Cold War. Yarrows had a reputation for building fast, well-armed ships, including the first 30-knot and the first 40-knot ships at the turn of the last century and, in the early 1970s, five of eight Type 21 frigates for the Royal Navy.
The Type 21s’ handsome looks, nimble manoeuvring and acceleration earned their captains the nickname of “boy racers”, and one of them in 1982, under the command of Captain (later Admiral Sir) Hugo White, made the 8,000-mile passage to the Falklands at an average 28 knots.
The son of Sir Harold Yarrow, 2nd Bt, and his first wife Eleanor, Eric Grant Yarrow was born in Bearsden, Glasgow, on April 23 1920 and brought up at Craigend Castle, Stirlingshire, before attending Marlborough College. He had begun an engineering degree at Glasgow University and an apprenticeship at the engineers Weirs when war broke out.
Joining the Royal Engineers, he took part in the retreat through Burma, where he recalled that all he carried across the border into India was his revolver, a water bottle and his battered camera. To prevent their use by the Japanese, he had destroyed several shallow-draft paddle steamers of the Irrawaddy Flotilla Company (IFC), many of which had been built by Yarrows.
A major aged 23, he ended the war supervising the removal of German landmines around the Hook of Holland: in the postwar honours list he was awarded the MBE.
Yarrow joined the family firm in 1946. When Yarrows received orders from IFC to replace its wartime losses, Yarrow was challenged: “Why didn’t you sink more?”
He succeeded his father in 1962 and steered the company through a turbulent period for British shipbuilding, preserving the firm’s name and status when many others were falling into bankruptcy. His relationship with the Royal Navy was key to his success, but Yarrow also travelled extensively to win overseas orders.
He modernised the shipyard at Scotstoun, covering the berths so that construction could continue during the dark Scottish winters, and enlarged it to accommodate two ships at once. Neighbouring yards were acquired, the price of one being negotiated on the golf course with Sir John Hunter, until Yarrows covered a mile of the Clyde waterfront.
Even when the number of warship orders fell dramatically, Yarrows remained one of the prime contractors, and, besides the Type 21s, 10 out of 14 Type 22 frigates, 12 out of 16 Type 23 frigates and all six Type 45 destroyers were built at Scotstoun.
Yarrow took pride in maintaining good relationships with trade unions, ensuring that employees were informed of successes and failures. He opposed the amalgamation of the Clyde yards and refused the invitation of the Minister of Technology, Tony Benn, to chair Upper Clyde Shipbuilders (UCS), a decision which Yarrow regarded as the best of his business life.
Threatening to deny orders to Yarrows, the government acquired a 51 per cent stake in the company through UCS, but UCS lurched from crisis to crisis and Yarrow negotiated to extract his company when UCS went into receivership in 1971.
Yarrow’s creation of a group holding company with subsidiaries was a defence against political interference. Nevertheless, when the controversial Aircraft and Shipbuilding Industries Act was passed in 1977, his shipbuilding subsidiary was swept into British Shipbuilders. It was small satisfaction that the last ship built before nationalisation, named by the wife of the then Prime Minister, Jim Callaghan, was HMS Battleaxe.
Yarrow challenged the compensation terms, and the Conservative Party in opposition had agreed, but once in office the government was not interested in improving terms. Yarrow took his case to the Court of Human Rights, but that court found in the government’s favour.
Admiral Sir Richard Clayton, the Controller of the Navy, persuaded Yarrow to stay on for a year to oversee nationalisation. In the early 1980s Yarrow fought off a bid from Weir Group, but he retired from the parent company at 65.
Meanwhile, in 1962 he had joined the board of Clydesdale Bank, then called Clydesdale and North of Scotland Bank, based in Glasgow but owned by the Midland Bank in London. In doing so he effectively took the place of his father, who had been chairman of the bank for 25 years but died in harness on the day before he was due to retire in April of that year.
Yarrow became deputy chairman of Clydesdale in 1975 and was chairman from 1985 to 1991. He made a point of visiting every one of its 270 branches to thank the staff for their efforts, and in 1987 presided over its sale by the then troubled Midland to National Australia Bank – a transaction notable for the fact that the “due diligence” involved was carried out by the young Fred Goodwin, then an accountant but later to achieve notoriety as chief executive of RBS.
Yarrow joined the board of the new Australian parent, which declared Clydesdale to be its “flagship for Europe”. He also served for more than 30 years on the board of the Standard Life Assurance Co in Edinburgh.
Yarrow was very clubbable and held several offices, including Prime Warden of the Worshipful Company of Shipwrights in 1970. Among his many charitable interests he continued the family’s close interest in Erskine Hospital, which had started when Yarrows’ workshops made artificial limbs for servicemen disabled in the First World War.
He golfed from childhood, and became a member of five clubs, including the Thurlestone Golf Club in Devon, where Albemar, the family holiday home, sat by the 17th tee and was known as the “Albemar Arms”, where drinks were served when the 19th hole seemed too distant.
Eric Yarrow had enjoyed a close relationship with his father and was never happier than when he was with his children, grandchildren and many great-grandchildren.
In 1951 he married Rosemary Young. She died in 1957, and in 1959 he married Annette Steven; they had three sons but divorced in 1975. In 1982 he married Joan Botting (née Masters). She survives him along with his three sons, and three stepdaughters of his third marriage. A son of the first marriage predeceased him and a grandson succeeds in the baronetcy.