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Financial Times: LETTERS TO THE EDITOR: Paint sector stripped almost to the base

EXTRACT: The location of Shell’s headquarters in the Netherlands away from the world’s top financial centre may be emulated by Barclays/ABN Amro if those two banks merge, showing that we favour cutting our nose to spite our prospects.

THE ARTICLE

By Martin Simons
Published: March 31 2007 03:00 | Last updated: March 31 2007 03:00

From Mr Martin W. Simons.

Sir, Lombard’s comment in support of the impending takeover of E Wood Holdings by 3M (“A history lesson”, March 23) should be questioned. The agreed takeover of this specialist high-performance coatings company follows recent US takeovers of Tor Coatings and Farrow and Ball, a decorative paint company. These three have comfortably the highest operating margins among their UK peers.

Following these takeovers, only ICI, among the top 15 largest UK paint companies by sales, is UK owned. Some in the City would also like to see this historic company fall into foreign ownership.

The avalanche of disposals of large and small UK companies provides further opportunities for companies to adjust transfer prices and corporate charges or gain tax advantages, irrespective of the rate of corporation tax, at the expense of the exchequer and private people, many of whom are your readers.

The location of Shell’s headquarters in the Netherlands away from the world’s top financial centre may be emulated by Barclays/ABN Amro if those two banks merge, showing that we favour cutting our nose to spite our prospects.

Perhaps the FT will belatedly see the light of day if it is acquired by a German, Indian or US conglomerate or a private venture fund.

Martin E. Simons,

London SW15 6HJ

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