The Fourth Estate

“Thank you, Ms. Beresford,” said Townsend. “That’s most reassuring.”

She showed no reaction as she leaned forward and opened one of the files on her desk.

“Though I’ve spent several hours this morning going over your balance sheets, and despite the additional research of my excellent financial team, I am still in no position to judge if the Financial Times’s assessment of your company is accurate, Mr. Townsend. That paper has satisfied itself with an educated guess that your liabilities exceed your assets. It is my job to be far more exacting.

“My problems have been compounded by several outside influences. Firstly, having gone through your files, it is clear for anyone to see that you suffer from a disease common among self-made men—when you’re closing a deal you’re fascinated by the distant horizon, so long as you can leave it to others to worry about how you get there.”

Tom tried not to smile.

“Secondly, you appear to have made the classic error which the Japanese so quaintly describe as ‘the Archimedes principle’—namely that your latest deal is often greater than the sum of all your other deals put together.

“Specifically, you went ahead and borrowed $3 billion from a number of banks and

institutions for the purpose of taking over Multi Media, without ever considering if the rest of the group could produce the cash flow to sustain such a vast loan.” She paused and placed the tips of her fingers together again. “I find it hard to believe that this was a transaction on which you took professional advice.”

“I did take professional advice,” said Townsend. “And Mr. Spencer tried to talk me out of it.” He glanced toward his lawyer, who remained impassive.

“I see,” said Ms. Beresford. “If I fail, it will be the reckless gambler in you that will have been the cause of your downfall. Reading through these files last night and into the early hours of this morning, I came to the conclusion that the only reason you have survived so far is that over the years you have just about won more than you have lost, and your bankers, although often nearly driven to distraction, have—sometimes against their better judgment—retained their confidence in you.”

“Is there going to be any good news?” asked Townsend.

She ignored the question and continued, “My first responsibility will be to go over your books with the clichéd fine-tooth comb, study every one of your companies and its commitments—whatever their size, in whatever country, in whatever currency—and try to make some sense of the overall picture. If, when that is done, I conclude that Global Corp is still solvent in the legal sense of the word, I will move on to the second stage, which will undoubtedly mean selling off some of the company’s most treasured assets, to many of which I feel sure you will have a personal attachment.”

Townsend didn’t even want to think about which treasures she had in mind. He just sat there, listening to her mortician’s diagnosis.

“Even assuming that process is satisfactorily completed, as a contingency plan we will then have to draft a press release setting out why Global Corp is filing for voluntary liquidation. Should it prove necessary, I would release it to Reuters without delay.”

Townsend gulped.

“But if that step proves unnecessary, and we are still working together, I will go on to stage three. This will require me to visit every bank and financial institution with which you are involved, in order to try to convince them to give you a little more time to repay your outstanding loans. Though I must say that if I were in their position, I would not do so.”

She stopped for a moment, then leaned forward and opened another file. “It appears,” she said, reading from a handwritten note, “that I would have to visit thirty-seven banks and eleven other financial institutions based in four continents, most of which have already been in touch with me this morning. I only hope I’ve been able to stall them long enough for us to make sense of all this.” Her hands swept the air above the files on her desk. “If, by some miracle, stages one, two and three can be completed, my final task—and by far the most difficult—will be to convince those same banks and institutions, currently so apprehensive about your future prospects, that you should be allowed to put together a financial package to ensure the long-term survival of the company. I will not be able to reach that stage unless I can prove to them, with independently audited figures, that their loans are secured on real assets and a positive cash flow. On that subject, you will not be surprised to learn, I still need to be convinced myself. And don’t imagine for one moment that should you be fortunate enough to reach stage four, you can relax. Far from it, because that is when you’ll be told the details of stage five.”

Townsend could feel the sweat beginning to trickle down onto his nose.

“In one respect the Financial Times was accurate,” she continued. “If one of the banks takes it upon itself to be bloody-minded, then, I quote, ‘the whole edifice will come crashing down.’ If that is the eventual outcome, then I shall pass this case on to a colleague of mine who works on the floor below this one, and who specializes in liquidations.

“I will conclude by saying, Mr. Townsend, that if you hope to avoid the fate of your fellow countrymen Mr. Alan Bond and Mr. Christopher Skase, you must not only agree to cooperate with me fully, but you must also give me your assurance that from the moment you leave this office you will not sign a check, or move any monies from any account under your control, other than those which are absolutely necessary to cover your day-to-day expenses. And even then they must not, under any circumstances, exceed $2,000 without it being referred to me.” She looked up and waited for his response.

“Two thousand dollars?” Townsend repeated.

“Yes,” she said. “You will be able to reach me at all times, night or day, and you will never have to wait more than an hour for my decision. If, however, you feel unable to adhere to these conditions,” she said, closing the file, “then I am not willing to continue representing you, and in that I include this bank, whose reputation, needless to say, is also on the line. I hope I have made my position clear, Mr. Townsend.”

“Abundantly,” said Townsend, who felt as if he had gone ten rounds with a heavyweight boxer.

Elizabeth Beresford leaned back in her chair. “You may of course wish to take professional advice,” she said. “In which case I will be happy to offer you the use of one of our consultation rooms.”

“That won’t be necessary,” said Townsend. “If my professional adviser had disagreed with any part of your assessment, he would have said so long before now.”

Tom allowed himself a smile.

“I will cooperate fully with your recommendations.” He turned to glance at Tom, who nodded his approval.

“Good,” said Ms. Beresford. “Perhaps you could start by handing over your credit cards.”

Three hours later Townsend rose from his chair, shook hands with Elizabeth Beresford again and, feeling utterly exhausted, left her to her files. Tom returned to his office as Townsend made his way unsteadily up the staircase to the floor above and along the corridor to the chief executive’s room. He was about to knock when the door swung open and David Grenville stood in front of him holding a large glass of whiskey.

“I had a feeling you might need this,” he said, handing it to Townsend. “But first tell me, did you survive the opening rounds with E.B.?”