Private Investor: Why is the DTI being so quiet over BAA?
Er, so where’s the bid? For Alliance & Leicester, I mean. For the second week now there’s nothing doing. I suppose that it just goes to show you oughtn’t believe everything that you read in the papers. For weeks now the financial press has been full of detailed and apparently well sourced speculation about various continental European bidders for our little mortgage bank. It looks an ideal morsel, and figures of £12 to £15 a share have been bandied around. And yet not a single solitary euro has been put on the table. So I’m sitting on a small paper loss in Alliance & Leicester instead of a fast buck. Even if a bid does emerge for A&L I suspect it might turn out to be a bit of a joke, like Ferrovial’s current offer for BAA, another of my investments. BAA is a long-term core holding of mine. Why is it a long-term core holding? First, because of the long-term trend towards more air travel, occasionally interrupted but never extinguished by terrorist acts. Second, because it is a monopoly.
