Grant Shapps’ response to P&O Ferries keeps the laid-off workers from getting their jobs back | Nils Pratley

GRant Shapps sounded very pleased with his nine-point response to the P&O Ferries debacle, but it’s hard to see how any of the transport secretary’s moves will force the company to cut the 800 workers it laid off without consultation two weeks ago. to be put back into service. the government’s goal just a few days ago.

The strictest new policy will create powers to block ferries with crews paying less than minimum wage from UK ports. The 1965 Port Act is revised through primary legislation; until then port operators will be told to deny access to non-compliant ferries.

Fine, that reform will close a loophole in the minimum wage — or rather, a door the government deliberately left open for ferry companies when it changed the rules for other seafarers in 2020, Tim Tyndall, a labor partner at Keystone Law, told this week The Guardian. But P&O Ferries will likely view the change as perfectly acceptable from its point of view.

It appears the company cannot be forced to reintroduce anyone on old rates – which averaged £36,000 under a Jersey-based contract, according to chief executive Peter Hebblethwaite. Meanwhile, P&O Ferries’ competitors, the underbidders he grumbled about, will have to adjust to the enforcement of minimum wages. So P&O Ferries won’t be able to pay its irregular crew of temporary staff an average of £5.50 an hour, which was Plan A, but it could get the “level playing field” it says it was looking for.

Meanwhile, DP World, the parent company that blesses the law-breaking layoffs and is the power behind the ferries, now probably has fewer reasons to fear being kicked out of the UK’s free port programme, whose major trump cards are ports in the Thames and Solent. Shapps said the Dubai-backed company was “very welcome to invest in this country”, but must understand that “we take labor law seriously” and that it must “address this HR situation”.

It wasn’t clear what ‘deal with’ meant, but DP could try to fire the arrogant Hebblethwaite, who, seen from Dubai, has now likely served his purpose as a lightning rod for public anger. He looks expendable even before the Insolvency Service has had a chance to assess his suitability to serve as a business manager. Shapps would get a scalp and DP would hope to suffer no collateral damage for his role in this outrageous saga. However, the former employees of P&O Ferries would still not get their jobs back.

Pearson is no fuss

Education publisher Pearson has been disappointing its shareholders for about 20 years. Andy Bird, a digitally savvy boss with a (possibly) bountiful bonus deal, was meant to change all that, but the ex-Disney executive hasn’t done much magic to the stock price during his 18 months in charge. A trading update in October sent the stock down 12% per day; the pace of revival in the US has so far been a pedestrian, just as it has always been.

So you might assume Pearson would be a sitting duck if a major US private equity predator showed up. But no, that’s not how the plot worked out. Candidate bidder Apollo walked out on Wednesday after his third chance – 884p-a share, or £7.2bn including debt – was dismissed by Pearson’s board as a “significant undervaluation” of the company and its prospects.

And actually the undervaluation line is reasonable. Expectations for takeover bids have risen. Supermarket chain Morrisons (where Apollo was out of the running early) was sold off last year at a 60% premium to the pre-action share price, so 40% for Pearson, a company with more reversal potential, was not. clearly compelling. It also felt too early to give up on Bird’s plan to get Pearson into the air. A three-year crack in the works seems only fair: there may be more operational progress than appears from the outside.

The other conclusion may be that the British takeover game has become a little less fraught in favor of private equity raiders. The cost of borrowing has risen over the past year, making it more difficult to stretch borrowing ratios. Apollo, who had bought and sold Pearson rival McGraw Hill a few years ago, arrived in the American textbook market with expertise, but was ultimately unable, or unwilling, to go high enough to force Pearson’s board into negotiations.

The picture could change again in the buyout barons’ next big adventure, but the lack of drama on this occasion is welcome. FTSE 100 companies, even those with Pearson’s disappointing track record, shouldn’t be pushovers.

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