Is it time for a reassessment of Sir Richard Branson? Chosen by the Treasury as the ‘preferred bidder’ for Northern Rock, he’s back where he craves to be and so often manages to put himself: in the headlines. And like every time he grabs the nation’s attention, two quite different caricatures of him have been projected.
On the one hand, there is the tirelessly creative, totally unconventional adventurer-entrepreneur whose brand image can sell anything and whose two-fingers-to-stuffy-old-corporate-capitalism has such powerful appeal to consumers even after many of them have had rotten experiences of his trains and his mobile phone service. The brand power of Virgin Money is clearly a major reason why its bid for the Rock is preferred over the JC Flowers consortium, which to City eyes looked at least as credible and as well backed, but whose promoters are relative unknowns in Britain.
But then there is the other Branson: the self-publicising, self-righteous maverick of whom so many deal-partners have tired over the years, who in his early days in the record business spent a (well documented) night in jail and paid a large fine for Customs & Excise offences, whom the City found impossible to handle in the years when Virgin was a public company. You can get the flavour of that in Jeff Randall’s column in the Daily Telegraph today. You can get more of the same flavour in Tom Bower’s excoriating biography of Branson, published in 2000, in which – besides a catalogue of character flaws – an analysis of all the available Virgin financial data suggested to the author that the debt-laden, over-stretched conglomerate was bound one day to implode.
It has not imploded, however, and Branson has gone on from one publicity coup to the next, flashing the smug grin that so provokes his detractors. And however much the latter group may suspect his motives to be less than perfectly righteous, we should remember that it was supposedly super-respectable British Airways that committed dirty tricks against Virgin Airways and was forced to confess them in court; that it was an American gaming operator called G-Tech whose boss Guy Snowden tried unsuccessfully to bribe Branson not to compete for the National Lottery franchise, and lost the subsequent libel action; and that it was Branson who last year declared he would give $3 billion from the future profits of his rail and air businesses towards the cause of ‘green’ fuel research.
So maybe he does have a wide streak of righteousness in him, and it’s just the manner that irritates. But politicians have never quite managed to harness him to their causes either: there was a famously awkward appearance with Margaret Thatcher in support of – of all things – ‘Keep Britain Tidy’; then it was William Hague who nominated him for a knighthood; and Cherie Blair was once reported to have said to him at a Downing Street party, ‘I’ve been talking to Tony and we agree that we must do something for you.’ But will Gordon Brown and Alastair Darling have more success in pinning him down – so that the unwinding of the Northern Rock fiasco cannot be spun by their opponents as a naïve combination of pain for the taxpayer, punishment for Rock shareholders and fast-bucks for the bearded balloonist?
Much of what Virgin Money, led by reassuringly conventional Jayne-Anne Gadhia, has said so far is well towards the righteous end of the spectrum: support for the Northern Rock’s charitable foundation, sympathy for its staff, no significant profit-take until all the taxpayers’ loans have been repaid. And yet the financial media have been quick to sniff the Bransonian cunning. For an investment of only £200 million up front – barely enough to pay the fees of the lawyers and investment bankers who will crawl all over the deal – he buys what could become a 30 per cent stake in a bank with a £130 billion balance sheet, while existing shareholders find themselves heavily diluted by a rights issue; meanwhile, he collects handsome fees for the use of the Virgin brand name; and at the end of it, if all goes well, he collects a so-far unspecified ‘super-bonus’.
So which way should we pass judgement? Let me be honest: I’ve never been convinced by the Branson persona. If I have a favourite anecdote about him, it’s the one Tom Bower tells about Branson and his balloon pilot Per Lindstrand in Virgin Atlantic Challenger as it raced uncontrollably over the Irish Sea in the final moments of its 1987 Atlantic crossing. As the terrified Branson screams ‘We’re going to die, we’re going to f***ing die’, the super-cool Lindstrand has to decide whether to knock him unconscious to shut him up, or to keep both hands on the controls of the lurching craft; eventually he decides to jump into the water instead, leaving Branson paralysed by fear behind him.
A cruel little story perhaps. But it has its positive aspect: you wouldn’t want an utterly nerveless risk-taker running a high street bank, would you? If greed is good in capitalism, so sometimes is fear and the caution that comes with it. And whatever baggage the Virgin name carries, it is undoubtedly a powerful, instant-recognition brand that in more normal times would have reasonable appeal to depositors. As for Branson himself, he is more than just a lucky survivor: he’s a fiendishly clever operator who has confounded his detractors time after time. So let’s just wait and see whether his Northern Rock balloon takes off.