The Thankless Marriage Broker

In its effort to encourage the unprecedented wave of corporate mergers now sweeping the country, Harold Wilson's Labor government has acted on the belief that Britain can best compete in world markets with bigger, more efficient companies. Wilson's detractors are not so sure. And they have been particularly suspicious of the Industrial Reorganization Corporation, a quasi-governmental group that has produced more than its share of bickering in its role as Britain's official corporate marriage broker.

Set up by the government in late 1966, the I.R.C. is authorized to draw up. to $360 million from the national treasury to promote and help finance regroupings in British industry. To many opposition Tories and business leaders, the I.R.C. smacks of "back door nationalization," under which the government could wind up with a dominant voice in the new industrial combines that it fosters. In fact, the I.R.C.'s own managing director, Merchant Banker Ronald Grierson, made no secret of his growing distaste for Wilson's interventionist economic policies, finally quit his post last October.

At the same time, the I.R.C. has not been spared attack from a number of left-wing Laborites who tend to feel that it has accomplished too little. Though limited in staff size as well as funds, the I.R.C. has indeed played an active role in relatively few of the country's many recent mergers. One of its notable public achievements was its help, including a $42 million loan, in arranging the marriage of Elliott-Automation and English Electric into a single $990 million-a-year computer-making company. The I.R.C. has also worked behind the scenes on even bigger deals, including General Electric Co. Ltd.'s acquisition of Associated Electrical Industries Ltd. For that, however, it received criticism as well as praise, especially from A.E.I., which resisted G.E.C.'s takeover attempts until the end. Dear Independence. Grierson's successor in the post of managing director, Charles Villiers, 54, also a merchant banker, has taken on the largely thankless task of assuaging businessmen's fears about excessive government intervention in industry, even while stepping up the I.R.C.'s activities. Insisting that the I.R.C., despite its government ties, operates with a virtually free hand, Villiers says that "such independence is very dear to us. It means that industrialists can come by and consult with us freely." He adds diplomatically: "As we look at it, our function is to help industrialists help themselves."

While that function can involve a variety of approaches, Villiers sees mergers between the country's many "fractionated companies" as the best way to shore up British industry. Demonstrating the importance it attaches to that mission, Wilson's government has set Villiers' salary at $48,000 a year, which makes him better paid than any of the country's Cabinet ministers--including Wilson himself.

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