Page 250 - James Caan - The Real Deal

The Real Deal

‘How much of the company are you floating?’
‘Twenty-five per cent.’
‘Would you sell us 40 per cent?’
I had never considered selling that much of the company.
‘I don’t think that’s something I want to do.’
At this point I was very excited about the flotation. I wanted to
look up my company in the Financial Times every morning, I
wanted the fireworks and champagne on the day of the offering, I
wanted to be the boss of a publicly owned company: I really
wasn’t interested in what he was suggesting.
He rang me again.
‘I’m frustrated,’ he said. ‘We obviously got to you too late, but
we really like your company and we really want to invest. We like
the sector and we think this is one of the best investment
opportunities we’ve seen all year. Let me come and talk to you.’
‘I hear what you’re saying, John, but why would I sell to you?’
‘Just let me come and see you.’
He talked me through what the flotation would mean for my
day-to-day life, and the restrictions shareholders and regulators
would impose on my business.
‘Every time you want to make a change you’ll need your
shareholders’ permission. You’ll be holding extraordinary general
meetings just to change a light bulb. If you want more investment,
it will take ages, whereas with private finance it would only take
a few meetings. Seriously, you have no idea just how restrictive it
is running a publicly owned business.’
He was making some valid points, so I thought about what he
was saying and tried to imagine me answering to shareholders who
only cared about their dividend payments. He was starting to
persuade me. His other argument was equally persuasive: the stock
market doesn’t allow founders to cash in very many of their chips
at the time of the offering. Investors like to keep you hungry, and
so there would be a limit on the percentage of my holding I would

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