Lucas Varity

[Mike Wattam <MikeWattam@domain.elided>]

Dear All

Some months ago, a number of you were asking about whether Lucas was still
going to make Stag bits, some talked of Lucas losing interest and even of
closing down.  I have been making extensive enquiries over a period of time
and this is the situation as I see it now.

History:  Lucas was bought c2 years ago by the Varity Corporation - Victor
A Rice (thus VARity) and his henchman Tony Gilroy.  Rice has bought (and
subsequently sold) a number of other companies including Cummins, Perkins,
and sold them again after a bit of asset-stripping for a fairly good price.

More recently Victor Rice wanted to move the UK headquarters of LucasVarity
to the USA and transfer from a London stock-market listing to a USA
listing.  However, the UK investors were mainly large institutions like
pension funds who had historically experienced higher than average returns.
 These institutions veto-ed the move and brought a 'no' vote on Mr Rice who
now faces censure by his board and an AGM of the company.  He certainly
should have been able to predict the way the vote would go, so I think the
words 'blind' and 'arrogance' might be thought here.

Undeterred, he is now trying to sell offf the whole company and the
favoured suitor appears to be TRW who are heavily into auto parts, mainly
for the OE market.  Other suitors include Dana which is mainly an
after-market specialist.

If all the above leaves you confused, the over-riding truth is that Mr Rice
did not axe any of the Lucas operations and it must therefore be assumed
they are/were turning in good profits for him and there is therefore no
reason to suppose any new owner would treat Lucas differently.

There is one other interesting point, though.  Mr Rice DID cut Lucas
manufacturing capacity greatly and sub-contracted manufacture of lamps and
ignition parts.  This subcontracting continues unabated and you can assume
that even if Lucas itself ceases to exist, the sub-contractors will still
be able to make the parts we need.  Do not forget, Lucas still makes a
substantial amount of auto industry OE parts and the auto makers will not
watch their supplier melt away.

Mike Wattam
Chairman, Triumph Stag Register