24th April 1998. The Attraction of Magnet.
Today in 1998, BBC Online News reported the end of Britain’s longest running industrial dispute, which had begun in August 1996.
It arose over a demand for a pay rise from employees of Magnet the joinery and kitchen manufacturer after a four year pay freeze which resulted in August 1996 in 320 being sacked at Darlington after refusing to sign a no-strike demand.
It appears that in 1996 the company only offered half the work-force a rise of 3%, resulting not surprisingly in an official strike.
Magnet was formed in 1918 by Tom Duxbury as a one-man firewood company which developed into general joinery, windows and doors.
By 1965 production was centred in Keighley, Yorkshire; ten years later it had become Magnet-Southern, forming part of the new FTSE 100 Index.
By October 1987, clouds were on the horizon for the biggest employer in Keighley, with a fraud inquiry into the computer department, and 55 lorry drivers being arrested for fraud.
They were charged for claiming for parking and accommodation, when in fact they were sleeping in their cabs.
By January 1989 there was a management buy-out by Tom Duxbury, grandson of the founder. The next month most of the drivers were convicted, with two for forging parking tickets, the drivers saying in mitigation that it was a ‘perk known to management’.
Things got worse for Magnet, with an overpriced management buy-out via loans from banks, and by October workers were on short-time, due to overstocking and a struggle with repayment of interest rates.
Two months later Chairman, Tom Duxbury resigned with huge personal loss and the banks took over and John Foulkes, formerly of ‘asset-stripper’, Hanson, was brought in at an astronomical salary and bonus.
After losses in 1990, a new parent company, Airedale Holding Plc was in business. Two years later Foulkes announced losses of £56m but happily received £1m in bonuses; Keighley now had half the previous work-force.
A new holding company Magnet Group Plc was set up after murky deals which left £700m debts with Airedale Holdings folding, allowing banks to write-off debts. All directors of Airedale joined Magnet Plc including Foulkes.
January 1994: Alan Bowker buys Magnet via ‘shell company’ Beresford International, three years later payments to directors of £2.2m would have settled the pay claim.
In 1998 most sacked workers accepted some settlement to retrain and job search.
In 2012 Magnet was owned by Nobia of Sweden.
There used to be a Magnet outlet in the Author’s home town, but disappeared in the troubles, a reminder that amidst all the high finance, talk of restructuring, ‘shell-companies’, management buy-outs, it is the ordinary worker who suffers; ‘fat-cats’ get the cream.
bbc.co.uk/1/hi/uk. Friday 24.4.1998/Pics.