View from City Road: Panel brings forth a mouse

THE FAYED brothers must have had a spring in their step in Harrods' food hall as the Takeover Panel delivered its cautious sentence on their conduct in the takeover of the stores group House of Fraser.

The Fayeds, according to the panel, were responsible for a breach of general principle 12 of the code then in force. They have been censured.

Unexciting stuff for anyone who has faced the withering firepower of 'Tiny' Rowland and Lonrho - or, indeed, the Department of Trade and Industry. The department concluded that the Fayeds dishonestly misrepresented their origins, their wealth, their business interests and their resources to its officials at the time of the takeover. So the panel's view is not a slap on the wrist but rather a gentle caress.

The panel cleared the Fayeds of any breach of general principle 3, which requires that no relevant information shall be withheld from shareholders. It says the brothers had indicated that they were the beneficial owners of the cash to buy Fraser and the owners of the stores group. Since the Trade Department's inquiry had been unable to probe to a definitive conclusion, the panel decided that no useful purpose would be served by going down this route.

Instead, the Fayeds are said to have given a misleading impression, although the panel has decided not to opine whether the misleading was 'intentional'.

This affair does little for the regulatory reputation of the panel, which started its inquiries five years after the takeover - and then only because of the Trade Department's inquiry and its subsequent report.