CAMPAIGNS: What The Media Say - Media maul Marconi as shares dive

Organisation: Marconi

Issue: Major financial strife

'Dramatic collapse' (BBC Online, 7/9), 'excruciatingly painful decline'

(The Times, 6/9), 'tale of hubris' (The Independent, 5/9) 'calamity'

(The Times, 8/9).

The story of former telecoms equipment giant Marconi's journey from

'boom to bust in a year' (The Daily Telegraph, 7/9) had the media

digging deep for its best hyperbole as it reported on the company's

restructuring in the face of massive losses and debts.

The Daily Mail (5/9) was not alone in its description of the 'earthquake

of Marconi representing one of the most spectacular industrial failures

of the post Second World War era'. The Times' (6/9) Patience Wheatcroft

wrote of the transformation of a 'cash-rich, solid enterprise into a

basket case.'

Ousted chief executive Lord Simpson was spared no blushes and the knives

were out for the veteran British businessman and the 'final insult' (The

Mirror, 5/9) of his £1m pay-off. He presided over a 'reckless

smash and grab,' said The Guardian (6/9) and helped transform Marconi

from 'one of British industry's greatest successes into one of its most

calamitous failures'.

His successor, the internal candidate Mike Parton, fared little better

among commentators at his 'nervous first outing' (The Daily Telegraph,

8/9), with most analysts agreeing he begins with a 'tarnished

reputation' (Sunday Business, 9/9).

It emerged the Financial Services Authority, the City watchdog, was

investigating the July profits warning, and the banks which had provided

Marconi's unused credit facility were looking to renegotiate.

New chairman Derek Bonham, however, was providing a slightly more upbeat

note. He seemed to be winning friends with his 'fighting mood' (

7/9) and statement that 'shareholders' anger was justified' (The Sunday

Telegraph, 9/9).

As to the question of whether the 'once proud telecoms firm' (BBC Online

7/9) will survive, analysts were divided. One optimistic view in The

Financial Times (7/9) was that the share price fall was 'an

overreaction ... people simply throwing in the towel'. But a more

forceful - and often echoed - note of doom was that the 'former flagship

of British industry' (Wall Street Journal, 7/9) was 'lurching closer to

insolvency' (The Guardian, 6/9).

Analysis and commentary by Echo Research. More information can be found


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