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