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The BBC's Andrew Verity
"Three other building societies are in similar kinds of trouble"
 real 28k

Friday, 3 December, 1999, 15:17 GMT
Building society rejects carpetbaggers
leek united logo

The Leek United Building Society looks almost certain to keep its mutual status after members voted overwhelmingly against a hostile takeover bid from carpetbagging company Murray Financial.

They rejected the bid by almost three to one in a postal ballot ahead of a special meeting in Stoke on Trent.

It would have meant potential windfalls of as much as 950 for some members.
Voting figures
22,712 (73.3%) against
8,264 (26.7%) for
Total membership = 60,000


The company had planned to convert the Leek first into a bank, and then an internet-based financial institution.

Murray Financial was set up in April last year as a vehicle for taking over mutual societies.

Shadow environment secretary John Redwood is one of its non-executive directors.

A spokesman for the Edinburgh-based Murray Financial said: "The real losers are the members of Leek United, who will not be receiving a windfall bonus, the town of Leek, which has missed out on extra jobs, and the Leek United staff who would have benefited from enhanced career prospects."
john redwood John Redwood is a non-executive director of Murray Financial


A spokesman for Leek United said: "We are delighted by the result. If you take our total membership Murray Financial attracted the support of just 14% of our members."

Ken Murray, chief executive of Murray Financial, attended the meeting.

The Leek spokesman said: "Mr Murray was jeered out of the hall by our members as he left to get into his car and drive away."

Hope for other societies

The result of the vote will be good news not only for the management of the Leek, but also for the other three building societies facing similar attacks.

The Portman, Chelsea and Skipton are all facing calls from carpetbaggers to demutualise.

They are the UK's fifth, eighth and seventh largest building societies.

Operating through the carpetbagger.com website, unknown figures have collected the appropriate number of signatures needed from members to force a vote on the issue.

The signatures were sent to the three building societies just in time to beat the 1 December deadline when new legislation to protect their mutual status came into force.

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See also:
01 Dec 99 |  Business
Carpetbaggers race to beat deadline
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