COVER STORY: Rich List
John Caudwell tops our tree in our third annual survey of the region's wealthiest self-made individuals. In an exclusive interview Caudwell also tells us his next move and how he now plans to share his spoils.
War, terror and economic slowdown haven't dented wealth creation in the Midlands. Philip Beresford, author of the Sunday Times Rich List, introduces the richest Midlanders, including those who have sold out and a former tax inspector turned IT entrepreneur
The region's top 100 business millionaires have seen their collective wealth rise to £310.359 billion, a healthy rise on last year's £39.9 billion in this the third annual Midlands Business Insider Top 100 Rich List.
Our 100 are the real movers and shakers of the regional economy, ranging from mobile phone tycoon John Caudwell, at number one with a £31.28 billion fortune, to a former tax inspector (talk about gamekeeper turning poacher) in the shape of Game Workshop's Tom Kirby. The 100 all run a business which they have either built up or inherited. They are not the idle rich - the pop stars, the landed aristocracy or those with a tenuous connection to the region. Our 100 really matter.
Their continued prosperity, as owners and managers of businesses, is our continued prosperity as their employees. Jobs grow from their prosperity as surely as night follows day.
While we worried last year about the continued health of some important family concerns such as Hereford's HP Bulmer, we were unduly alarmist perhaps. This year we have seen the great buyout boom, with family companies, even Bulmer, being sold at pretty fancy multiples. Even Caudwell, Stoke's answer to Bill Gates, was not immune from the blandishments of giant Vodafone, and sold his Singlepoint subsidiary for £3405m. But he is not retiring to the beach. Indeed, can one see the hyper-active Caudwell ever retiring?
He remains in the list as he still runs a thriving operation, but others have gone, notably Michael Cornish, the former boss of Linpac, one of Britain's best kept secrets. The huge Lincolnshire packaging operation was sold by the Cornish family in the summer to venture capitalists in an £3840m deal. In Northampton, the Wilson family has just collected around £3100m for its stake in the quoted Wilson (Connolly) housebuilder. Seven of last year's Top 100 have disappeared off our radar screen as a result of selling up.
But don't run away with the idea that the working rich are simply cutting and running when the first half-decent offer is tabled. Our region - stretching from Staffordshire in the North by way of the Birmingham conurbation to Northants in the South and Herefordshire in the West to Lincolnshire in the East - is showing some extraordinary resilience on the back of some bold investment decisions. At construction equipment giant JCB, Sir Anthony Bamford has detected some signs of growth in export markets. That has prompted him to sanction a £350m investment programme on a new diesel engine, which will be designed and built in Britain. Better still, it will replace a foreign import. Can this really be Britain in 2003 where manufacturing is supposed to be dead and buried? The JCB decision and the likely improvement in profits leads us to raise the Bamford family worth to £3850m, but they lose their number one spot to Caudwell nonetheless.
No less bold in its field has been Brintons, the Worcestershire carpet manufacturer. It is close to unveiling a new machine which will revolutionise carpet manufacturing by making bespoke carpet manufacturing tailored to individual requirements much more viable. It promises to be one the most notable technical advances in the history of carpet manufacturing and should be an immense boost to Brintons' competitive advantage.
The make-up of the Midlands Top 100 reflects a strong industrial bias. Of the 100 millionaires or families, 37 are drawn from traditional industry or the new sunrise industries of software and mobile phones. By contrast we have only four retailers here. So the idea that the Midlands business is tilting to a retail paradise may be a bit premature, to say the least. Nearly as prominent as the industrialists are the property and construction tycoons such as Don and Roy Richardson, Grahame Whateley and Tony Gallagher. In all we have 25 from this sector.
The number of women in the list continues to rise from nine last year to ten in the current list. But it is a long hard slog. The Midlands, though, is blessed with a number of very successful women entrepreneurs who are strong role models for their gender in business. Geographically, Birmingham and its environs naturally dominate the ranks of our Top 100 with 30 tycoons, but Leicestershire is also a strong runner with 15 from the county. But to find out who are in the Top 100 just read on for their individual entries.
These are the rules
Here are the rules that governed our selection:
1 All stakes in quoted companies were valued by taking the share price in the Financial Times in early October 2003.
2 Private company stakes were valued on a par with the nearest equivalent quoted company or failing that by the prevailing prices in the sector. If that was not appropriate, then we simply used a multiple of around 10 times the profit figure to value a business, reflecting the stock market average. Where it was appropriate, companies and therefore family stakes are valued on the net assets of the business.
3 trusts and overseas holdings which appear to be controlled by an individual or family are counted as family stakes for the purposes of valuations.
4 We do not pretend that this list is complete either in terms of scooping up all the people who should be included or all the wealth of all the people who have been included. Many of the 100 are richer but we have made our judgement on what we can see. We have no access to personal details such as investment portfolios but are delighted when such details are sent to us for valuation purposes.
5 The area covered by this survey stretches from Staffordshire in the North by way of the Birmingham conurbation to Northants in the South and Herefordshire in the West to Lincolnshire in the East.
6 We hope that anyone who is obviously missing can be gathered up for next year's list and apologise to them in advance if they feel slighted at not being included. For those who do not want to be in the list, we would point out that all the information is drawn from public sources such as Companies House and that we are careful never to reveal where the Top 100 live for obvious reasons.
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