CONFIDENTIAL
FM BTC HONG KONG
TO DESKBY 071730Z FCO
TELNO 47
OF 07053OZ FEBRUARY 91
INFO IMMEDIATE HONG KONG
CONFIDENTIAL
020467 MDHIAN 2675
YOUR TELNO 46 : HUTCHISONS : CALL ON LORD CAITHNESS BY LORD DERWENT AND SIMON MURRAY, 11
FEBRUARY
1. OUR CONTACTS WITH HUTCHISON ON THE NATIONALITY PACKAGE AND WHETHER THEY MIGHT QUALIFY AS A BRITISH UNDERTAKING HAVE BEEN ENTIRELY BETWEEN ME AND SIMON MURRAY. I HAVE NOT TOLD HIM OF ANY DECISIONS BY THE COMMITTEE, ALTHOUGH HE DOUBTLESS WILL HAVE BEEN ABLE TO GUESS THE DIRECTIONS WE HAVE BEEN TAKING FROM THE NATURE OF MY ENQUIRIES. THESE CONTACTS HAVE COME AT VARIOUS POINTS AFTER ADVISORY GROUP MEETINGS WHICH HAVE CONSIDERED THE CLAIMS BY HUTCHISON AND RELATED COMPANIES TO BE CONSIDERED A BRITISH UNDERTAKING. IN EACH CASE IT HAS BEEN TO ASK HIM TO SUPPLY MORE SPECIFIC INFORMATION EG ABOUT OWNERSHIP, THE TYPE OF PASSPORTS HELD BY DIRECTORS AND LEADING SHAREHOLDERS, DETAILS OF SUBSIDIARY COMPANIES ETC. FROM THESE ENQUIRIES HE HAS PROBABLY BEEN ABLE TO DEDUCE, CORRECTLY, THAT ALL PARTS OF THE LI KA SHING EMPIRE ARE CLOSE TO THE OUTER LIMITS OF WHAT MIGHT BE CONSIDERED A BRITISH UNDERTAKING, BUT THAT HUTCHISON WHAMPOA AND HONG KONG ELECTRIC AND THEIR SUBSIDIARY COMPANIES WERE MORE LIKELY TO FIND FAVOUR THEN CAVENDISH AND CHEUNG KONG AND THEIR SUBSIDIARIES. SINCE THE COMMITTEE DECIDED AT ITS MEETING ON 29 JANUARY TO INCLUDE HUTCHISON AND HONG KONG ELECTRIC BUT TO EXCLUDE THE TWO OTHERS, HAVE BEEN IN TOUCH WITH HIM AGAIN TO ASK HIM TO SPLIT SUBSIDIARY COMPANIES OF EACH OF THESE FOUR INTO SEPARATE COMPARTMENTS, SINCE HE HAD GIVEN THEM TO US IN ONE BATCH WITH NO INDICATION OF
PARENTAGE. I HAVE NOT TOLD SIMON MURRAY OF THESE ULTIMATE FINDINGS OF THE COMMITTEE, JUST AS I HAVE NOT TOLD ANY OTHER COMPANY IN STRAIGHT TERMS WHETHER THEY ARE ON OR OFF THE APPROVED LIST. REACHING DECISIONS HAS BEEN DIFFICULT ENOUGH. MOREOVER THE
LIST WILL BE PUBLISHED. THERE SEEMS NO REASON TO GET INTO
INDIVIDUAL DEBATES ON DECISIONS TAKEN.
2. PRIOR TO HUTCHISON WHAMPOA'S MOVE THIS WEEK TO TAKE CAVENDISH INTO PRIVATE OWNERSHIP, I WAS ALREADY A TOUCH UNHAPPY ABOUT THE DECISION TO EXCLUDE CAVENDISH, SINCE THEY ARE ALREADY MORE THAN 50 PER CENT OWNED BY HUTCHISON WHO WE HAVE APPROVED, AND I WAS
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