But the group pointed yesterday to a new slide in prices
But the group pointed yesterday to a new slide in prices.Heinrich von Pierer, Siemens’s chief executive, said: “It’s always been a cyclical market and the cycle is now at a low point, a trough. But as work began on the site, the price of computer memory chips crashed by as much as 80 per cent, forcing the company to review its world wide investment plans. When semi-conductor prices staged a 30 per cent recovery in the spring, Siemens pledged to press ahead with the second stage of the plant. When Siemens revealed its pounds 1.1bn investment programme for Tyneside in 1995 the original intention was to build two manufacturing halls, creating 1,800 new jobs in one of the UK’s most depressed regions. Pfizer said the grant was a “significant factor”, in its decision to expand in the UK.Though Ms Beckett boasted yesterday that Britain “has attracted far more of the world’s inward investment than any comparable country of its size,” not everything is going the Government’s way. “Pfizer could have put its investment in a number of other countries including the US,” she said.
She said the investment by Pfizer showed “Britain’s historic science base really is a priceless asset”.
Pfizer which receives a pounds 3m grant from the Department of Trade and a pounds 2.5m contribution from English Partnerships is considering an additional pounds 241m investment in the next three years to expand its research facilities, and for a new manufacturing plant and warehousing. However, Siemens, the German engineering and electronics giant, has abandoned plans to create up to 600 more jobs at its computer chip plant on North Tyneside after a new crash in global semi-conductor prices Sameena Ahmad in London and Chris Godsmark in Munich report. Pfizer’s decision to expand its existing research facility in Kent was hailed by Margaret Beckett, President of the Board of Trade, as “a vote of confidence” for inward investment into Britain. Vodafone has tripled in value since demerger while Chubb went for three times the price when Sir Nigel returned with his knighthood and an agreed bid this year.
Optimists think Racal Telecom might be worth pounds 1bn if Energis can float for pounds 850m. But a more realistic price might be nearer pounds 600m given that telecoms companies and public listings do not make happy bedfellows.. Pfizer, the US drugs giant, confirmed yesterday that it is investing pounds 109m in a new research facility in Sandwich, Kent in a government backed move which will create 1,000 new British jobs in the next five years. Would the resulting loan defaults and turmoil in Asian and other emerging markets fatally damage the international banking system or plunge the OECD into recession? Probably not is the answer. The IMF must be hoping beyond hope that the Korean government will do enough to meet its conditions.
But if it does not, it should let Korea face the consequences of its own decisions.. Racal Electronics may not bear the name of Sir Ernest Harrison but it ought to. He has been synonymous with its evolution over the last 47 years and there seems to be no end to the amount of shareholder value that the wily old bird thinks he can wring out of the business before hanging up his boots. At the age of 71 he is about to preside over the group’s third re-incarnation in less than a decade. The first rebirth came in 1991 when he demerged the cellular telephone business Vodafone (having floated a minority stake three years earlier) while simultaneously beating off a hostile bid from Nigel Rudd of Williams Holdings.
