Rothmans

"Rainbow sat tight until March 1986, when Heatley picked up *The New Zealand Herald* and saw that Rothmans had announced the sale of its New Zealand tobacco business to Rothmans Holdings Ltd of Australia for $80 million. Heatley knew that Rothmans’ New Zealand tobacco business was making $24 million a year so it did not make sense to him that the company was proposing to sell it for only $80 million. In addition, to his mind, the company was going about the sale in a Mickey Mouse way by not first seeking shareholder approval. ‘To this day I think the deal was essentially designed to screw the other shareholders in New Zealand. Anyway, that’s how I saw it. So I thought, This isn’t good, they’re trying to sell a key asset at a lower price than, in my opinion, it’s worth.’ Heatley called Rainbow’s lawyers, who advised him that Rothmans’ move was not illegal. But he was riled. It occurred to him that if Rainbow made an offer for the New Zealand tobacco business, then Rothmans Industries’ shareholders would have a legal right to know about it. That might thwart the proposed deal with Rothmans Australia."

"‘So now it gets heated. They send us a note back saying, “The deal’s done and you’re too late and we’re not interested.” Now I ⁠*know* there is something strange going on because if you were going to sell your house for $300,000 and I come along and offer you $350,000, you would take the $350,000 but they just said no. They didn’t even say, “Let’s have a meeting, let’s discuss it.” If they’d been smart they would have engaged with us but it felt to me that Bob Matthew had just taken this adversarial attitude, which seemed personal about me though I don’t know why.’ Again Heatley picked up the phone to Rainbow’s lawyers, who agreed to seek an injunction in the High Court against Rothmans’ sale of its New Zealand business to its Australian counterpart.⁠"

"‘Bob Matthew basically told me to fuck off. He said something along the lines of, “You’re wasting our time. You’ll never make any money. We don’t want you on our share register, piss off.” That was essentially the five minutes.’ Heatley was taken aback. Rainbow had no particular plans for the investment and no appetite for more than its 18 per cent. The new shareholder asked for a board seat and was turned down. Heatley had walked into a situation that he had not foreseen and he could discern no reason for the hostility. ‘But this is a male thing and I’m not particularly proud of it but when someone says, Fuck you, you kind of think, Well, fuck you, too.’ What Heatley did not know, and had no way of knowing, was that while Bob Matthew appeared to hold a significant stake in Rothmans, it had in fact been funded by BIL. Heatley knew only that Matthew was hostile."

"Rainbow sat tight until March 1986, when Heatley picked up *The New Zealand Herald* and saw that Rothmans had announced the sale of its New Zealand tobacco business to Rothmans Holdings Ltd of Australia for $80 million. Heatley knew that Rothmans’ New Zealand tobacco business was making $24 million a year so it did not make sense to him that the company was proposing to sell it for only $80 million."

"For Rainbow, the pleasure of sealing the Woolworths Australia deal masked an ominous downside. Brierley’s had gone after the same 20 per cent stake for which Rainbow had successfully bid. Via its Australian investment arm, Industrial Equity Ltd, BIL already owned 20 per cent of Woolworths and was keen to increase its stake in the Australian supermarket chain. So soon after BIL had been forced to pay more for Rothmans than it had expected, Rainbow had again irked its bigger competitor by getting in the way of a deal that Brierley’s thought it should have clinched. Whether or not Heatley and Lane were aware of it at the time, their Woolworths purchase turned Rainbow into a Brierley’s target."

"‘There’s too many players in the market all fighting over the same bones,’ he said in a lengthy interview with *The Evening Post* the week that Rainbow acquired a 20 per cent stake in supermarket operators Progressive Enterprises after selling its stake in Rothmans.[1](private://read/01jectdbce729daxqkxt7cbe8r/#mn6) ‘The market is too high—it is inevitable it will come back. There are some crazy prices being paid. There are some dopey things happening. Some investment companies are having to buy anything to give themselves earnings, it can only work for so long.’"

"In 1949, when Rembrandt made its first profit after initial losses, Rupert as chairman and Patrick O’Neill-Dunne, their marketing advisor from Rothmans, each became entitled to 2,5% of Rembrandt’s net profit. Rupert told the board that he wanted it to devote his share to good causes."

"That was the situation Rupert found when he started his inquiries about the Cartier brand in which Rothmans had acquired an interest. The brand in question was registered under class 34 of the International Brand Classification, the category that included tobacco, smokers’ accessories and matches, and turned out to be a world-famous cigarette lighter. It was the elegant, oval-shaped luxury cigarette lighter that Robert Hocq, the inventor of gas cigarette lighters, had licensed under Cartier’s banner. In time this invention revolutionised the luxury goods industry. The new recipe of combining functionality with luxury caused a turnabout in the cosy, exclusive world of the coterie of prominent luxury goods houses."

"The chemistry student – who with a personal investment of a mere £10 started a worldwide group of companies that would make him a world-famous entrepreneur – is linked to some of the best-known international trademarks, the foundation on which his business empire is built. From Cartier, the ‘king of jewellers and the jeweller of kings’, to the luxury goods of Alfred Dunhill, from Mont Blanc’s stylish writing instruments to the oldest Swiss watchmakers, all fall under Richemont, the international arm of the Rupert umbrella. It was preceded by the establishment of a global chain of tobacco interests under the banner of Rembrandt and Rothmans, as well as the production of the most famous South African wines and spirits."

"The 1960s were a period of consolidation as well as expansion of Rupert’s tobacco and cigarette interests. The takeover of Carreras and Rothmans led to expansion in other parts of the world. Using Rothmans as his flagship, he created a stir with his philosophy of industrial partnership in various countries where he embarked on new initiatives. Partnership companies were established on a bilateral basis in Australia and New Zealand, Malaysia, Singapore, Indonesia, Canada, Jamaica, Northern and Southern Rhodesia (now Zambia and Zimbabwe) and Nyassaland (now Malawi) − eventually even beyond the Iron Curtain in Russia and China."

"The phenomenal success of Peter Stuyvesant helped Rupert to lay the foundations of a business empire that would stretch across the globe. An important development at the end of the 1950s involved the British cigarette company Carreras, which had been outmanoeuvred by Rembrandt when they bought Rothmans."