Benton punched out Cornelius’s number in his Madeira Quay office. Since the Times deal had become public Cornelius had decamped from his home to the Herald offices in Docklands.
‘Morning, Cornelius,’ Benton began. ‘How are you today?’
‘I’m fine, Benton.’ Cornelius’s voice was loud, clear and impatient. ‘What’s up?’
‘I’ve got Chris Dower here and a couple of his colleagues,’ Benton said. ‘We’ve just heard from Gurney Kroheim. Laxton Media have received another bid.’
‘Shit,’ said Cornelius. ‘From Gill?’
‘That’s right. Eight hundred and seventy-five million. Cash.’
‘Shit, shit, shit. I thought you said you didn’t think Gill could get access to more funds?’
‘It looks like we were wrong,’ said Benton.
‘Will the Laxton board recommend it?’
‘According to Gurney Kroheim, “they are minded to”.’
‘What the hell does that mean?’
‘It means if we are going to come up with a higher offer, we’d better do it now,’ said Dower.
‘Shit. Can you get over here now?’
‘We’re on our way,’ said Benton.
It was a twenty-minute taxi ride. The four of them were squeezed into the back of the cab. Benton’s long legs stuck into the thigh of the more junior bag-carrier on the jump seat.
‘Can we raise our offer?’ Benton said.
‘It’s going to be tricky,’ said Dower. ‘The Capital Markets guys were talking to me yesterday. They’re not as sure as they were that they can get the three hundred deal away we were talking about originally. A bigger deal at a higher price would be very difficult.’
‘What? I thought you said the junk market was improving?’
‘It looked like it was. But we had that Matzin Industries default last week. It was a biggie. It’s got people scared. And there’s several billion of new deals lining up for the summer. Our guys are not convinced the demand is there from investors.’
‘I don’t understand you people,’ Benton said. ‘Two weeks ago you told the client that the market is strong. Now you change your minds. You can’t tell a client one thing one day and another the next, especially when he’s basing all his plans on what you say.’
‘Markets change, Benton,’ Dower said. ‘You’ve been around long enough to know that.’
‘What changes is you people’s willingness to take risk,’ Benton said. ‘One default and you run scared. Junk-bond issuers go belly up all the time, that’s why they pay such a high coupon. There are times when Bloomfield Weiss has just got to stand up and be counted, and this is one of those times.’
‘Benton, you know that that’s not something for you or me to decide, it’s for the Underwriting Committee.’
Benton didn’t reply but stared out of the window at the Canary Wharf tower, growing ever taller as they approached Docklands.
This was a problem. Approval from the Underwriting Committee was required before Bloomfield Weiss could write Zyl News another letter committing to a larger bridge loan. The committee included managing directors from sales and trading, as well as some of the firm’s most senior executives. They wouldn’t approve a bridge loan unless they were confident that the loan would be repaid from the successful launch of a junk-bond issue some time in the next few months. The committee was often willing to take big risks, but if the junk market was looking wobbly perhaps they wouldn’t this time.
If Cornelius didn’t raise his offer, they would lose the deal, it was as simple as that. Benton couldn’t afford that. For several years now as head of the London office he had been away from the sharp end of investment banking, away from the big deals and the big bonuses. He was paid a substantial salary, but the lifestyle he and his family had built up in expatriate London required big bonuses to fuel it. During the last few barren years he had borrowed to pay the bills, but that couldn’t go on for ever. He needed a big bonus, and a high-profile deal like The Times could get him one.
In the past he had succeeded through subtlety and contacts, but as the corporate world became ever more aggressive this had not been enough. The sad truth was that a successful investment banker was one who persuaded his client to pay the highest price. Those were the guys who earned the big fees and the big bonuses. Benton was determined to be one of them. Dower could go screw himself.
The taxi pulled up outside the all-glass building which housed the Herald’s offices and the investment bankers were whisked up to the executive floor. In a moment they were in the chairman’s office, with its expensive modern American artwork and its views of the Thames, the Millennium Dome and the gleaming architectural melange of the new Docklands.
A harried-looking Edwin was sitting in front of a laptop, surrounded by a mess of papers on the long conference table. Cornelius was pacing.
‘Sit down, gentlemen,’ he said. But as Benton and his colleagues took their places, he stayed on his feet. ‘We have to decide whether to come up with a higher offer. Any sign of the other potential bidders?’
‘Nothing,’ Dower said. ‘We know the Telegraph people have been talking to Laxton, but their offer would be certain to be referred to the Competition Commission, and Laxton don’t have time to wait for that. The price has become too high for the Germans and the Irish. So it’s just us and Gill.’
‘I’m not going to lose to that bastard,’ Cornelius said.
‘I assume there is no way you can get your hands on some more cash?’ Dower asked.
Cornelius shook his head. ‘No. Nothing significant, at any rate.’ He scowled. ‘I’m not like some other newspaper proprietors I could name. Everything I’ve got is already in this bid. There are no secret stashes in Switzerland or the Caribbean.’
‘I was not suggesting there were,’ Dower stuttered.
‘If you weren’t, you should have been, right, Benton? I know Edwin thinks the family should have a nest egg ready for a rainy day, don’t you, Edwin?’ Edwin ignored his father. ‘But no, if we pay more, we’ll have to borrow the money.’
Benton was just about to speak but Dower got in ahead of him. ‘There might be a problem—’
‘That’s what we thought—’ said Benton talking over him.
Cornelius raised his hand to silence them both. ‘A problem?’ He stared at Dower.
Dower swallowed. ‘The junk market is not recovering as strongly as we had hoped. There was a big default last week and investors’ confidence has been dented.’
‘Wait a minute.’ Cornelius bent over the table, leaning his large frame on his hands as he stared at the banker, his jaw thrust forward. ‘You gave me your assurance that we would have no trouble raising three hundred million pounds only the other day.’
‘I said it would be tight.’
‘But you gave me a letter.’
‘I know we did,’ said Dower. Beads of sweat had suddenly bubbled up on his brow, and around his fleshy neck. He was glistening. ‘We committed to fund the offer at eight hundred and fifty million. But we can’t commit to higher.’
‘The cash flow is very tight at eight fifty,’ Edwin said, looking up from his papers. ‘Much higher and the whole thing falls apart.’
Cornelius glared at Edwin. Although Edwin and Dower avoided each other’s eyes the bond between them was almost palpable. The numbers didn’t stack up.