Cambridge Cluster

It is a long walk up the Tourist Path to the summit of Ben Nevis.  If you are a lucky entrepreneur with time to spare, you keep an eye on the weather, dash up to Fort William, and start walking.  You can drive, fly or take the overnight train from London and use the luggage lockers and showers at the station.  First cross the road to the supermarket for “snap”(picnic) and take a taxi to the easiest start of the walk at the Ben Nevis Hotel; try to give the bar a miss on the way up!

The path goes up, up and up.  100,000 people make the yomp each so you are never alone.  One group from Belgium changed into kilts on the top to celebrate their success!

It is a pity that you cannot “pre-pack” the walk, and start fresh half way up.  Today’s entrepreneurs who struggle on their journey call in a sherpa or guide like McTear Williams & Wood and cast off their unwanted load of unsecured creditors along the way and start afresh.

Lord Karim Bilimora of Chelsea – inspirational speaker, Entrepreneur in Residence at the Judge Business School and founder of Cobra Beer – has just taken the pre-pack route and swapped a controlling interest in Cobra Beer for a minority stake in a new company owned 50.1% by Molson Coors.  Up to £70million of creditors may have been left behind.  The pre-pack deal looks like a rights issue with the added advantage of a culling of the creditors.  Secured creditors, and I guess all the shareholders, move into the new company with a new business plan.

In Cobra’s case, the shareholders might be a little disappointed as they have been investors for ten years and last year were looking forward to a sale of Cobra for around £200million.  But back to square one with a lightened load and new management, good times could be just round the corner.  But that is one of the many joys of being an investor in an Active Equity Company – another twist in the journey.

So with business booming, the sherpas of McTear Williams & Wood are celebrating the opening of new offices in Cambridge.  If they had landed the task of liquidating the bankrupt Lehman Brothers, they would have had over 3,000 legal entities globally to sort out – just dream about the fees and never forget the 25,000 people whose lives were turned upside down – and need an even bigger office!  In MW-W’s latest newletter, Andrew McTear says “Whether you like them or not pre-packs are a feature of the modern business rescue and insolvency world.  If used inappropriately they can cause greater loss to creditors and damage reputations.  Used in the right circumstances they can be a force for good.”

As the New Cobra sets out to reach the summit and reward all the new stakeholders, the walker can look forward to a well-earned beer back at The Ben Nevis Inn.  Unless, of course, you are an unsecured creditor or ex-employee when perhaps you can only afford to look at the webcam of Ben Nevis whilst you contemplate your losses.  Anyone for a beer? A Cobra?

Related articles by Zemanta

• Molson Coors downs Cobra Beer in £14m prepack (telegraph.co.uk)
• Cobra Beer bought by Molson Coors (news.bbc.co.uk)

Image via WikipediaProfessor Arnoud de Meyer is Director of the Judge Business School in Cambridge, UK. He joined from Insead three years ago and has lifted the Judge into the top echelon of the business school world by concentrating on building strong links with his host university – Cambridge. Apparently most other business schools want to go it alone and distance themselves from their host. European business schools, Insead in Fontainbleau and ISE in Barcelona are removed from clusters and Harvard Business School tries to keep its independence.

When I showed him the illustrations for Equity Fingerprint, the business plan resource, he was impressed. Now we need to follow his 3R mantra with the NESTA project. “Is it revealing, is it rigorously done and is it relevant – that is, can we translate it into the classroom? The importance of practical research is linked to the second area which we are building on – executive education. Through our research we want to influence the world of business, and executive education is a way of diffusing our ideas to a much larger audience than one would reach simply through MBA programmes.”

Equity Fingerprint will be rigorously done by Lancaster University Management School as part of the NESTA funded project. We know it is revealing and then it will be relevant. It will go global – well, that is the dream.