We're Ignoring the Warning Signs That Point to Disaster ; City Comment

Evening Standard - London › February 09, 2007

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Summary

ANYONE who doesn't believe that mankind is condemned to repeat the mistakes of a previous generation should get out the file and look at the private equity bid for then-supermarkets chain Gateway in 1988.

I appreciate the City of today thinks it is an age away from that decade, but the mistakes of the past are closer than they think. Back in those balmy days, there were five national supermarket groups in this country, of which Gateway was the laggard. Some bright private-equity sparks - yes we had private-equity back in the dark ages - decided to buy it.

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We're Ignoring the Warning Signs That Point to Disaster ; City Comment

The bidders got into an auction, where egos came to the fore - proving that some things never change - and the winners overpaid. Then interest rates doubled, the economy crashed, and they lost everything . In passing, they also destroyed the business, the ...

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