Calls for the regulation of financial PR firms were stepped up this
week after the Takeover Panel issued a sharp rebuke to Citigate and its
client Triplex Lloyd.
In a statement issued on Tuesday, the panel described as ’reprehensible’
the leak by Citigate to the Financial Times and the Guardian of
confidential information about steel casting firm William Cook - which
is the subject of a hostile takeover bid by Triplex.
The panel’s criticism comes a year after its chairman Sir David Calcutt
sent a letter to heads of City PR firms expressing concern about the
number of press leaks before and during bids. The letter followed the
censure of Financial Dynamics in December 1995 for leaking information
while defending Amec against a hostile bid from Kvaerner.
While admitting that transgressions by PR advisers were rare, the
panel’s deputy director general Peter Lee said that Citigate had clearly
flouted the code of conduct by deliberately passing confidential
information to newspapers.
Paul Kafka, deputy chairman of the IPR’s City and financial group,
renewed his call for regulation, arguing that PR firms were being
singled out for criticism precisely because they were not regulated.
The Takeover Panel censure is highly embarrassing for Citigate, which
plans to float on the Stock Exchange through a reverse takeover of
publishing firm Incepta Group. Citigate chairman David Wright was
unavailable for comment.