He Wants Watney's

Europe's third biggest beer, whisky and wine company, London-based Watney Mann, has grown rapidly with the lift of a catchy slogan: "We want Watney's." Nobody takes that slogan more to heart than Maxwell Joseph, a former army lance corporal who is one of Britain's richest entrepreneurs. Joseph is chairman of Grand Metropolitan Hotels, and he wants to buy Watney's so badly he can taste it. He has made two takeover bids for the company, and the latest, due to expire this week, is worth $ 1 billion of his company's securities.

Joseph's chances of gaining control heightened last week when another bidder dropped out. The Rank Organization--a movie producer and hotel operator that depends for most of its profits on its 49% ownership of Rank-Xerox, the European giant in copy machines--had offered $1.1 billion. Some banks and mutual funds in the U.S. and Europe had bought Rank stock for the Xerox profits and feared a dilution in earnings if the company acquired Watney's. These big investors forced Rank to withdraw its bid.

Frothy Empire. By contrast, Joseph, 62, has long had a fancy for beer. Last year he won a takeover battle for the London brewing firm of Truman. His defeated opponent in that fight: Michael Webster, chairman of Watney's. The Truman shareholders got Joseph's Grand Metropolitan stock and have seen its market value rise by 160% in a year. Small wonder that Joseph claims "Watney's shareholders would be better off if there were a merger." Naturally, Watney's Webster denies that. He proudly points to Watney's size and prospects: sales last year of $780 million and a predicted rise of 27% in earnings this year, from enterprises that range from 6,000 pubs in Britain to the distilleries that make Gilbey's gin and J. & B. Scotch.

If Joseph's past accomplishments are any guide, the Watney shareholders must find his offer tempting. Starting in 1944, he parlayed a few thousand dollars into a huge empire. He bought one hotel, then another and another. Joseph had an instinctive knack for sizing up property. "It's something that can never be taught," he says. He charged modest prices for hotel rooms, counting on high occupancy rates to turn a profit. As he puts it: "I just don't believe in charging up to the hilt." Today he controls a hotel, restaurant, food, beer and gambling network that spreads into France, Belgium, The Netherlands, Italy, Monaco and to New York (the Royal Manhattan Hotel on Eighth Avenue). Last year, on revenues of $818 million, his Grand Metropolitan Ltd. earned $33 million net, up 62% from the previous year.

A modest man, Joseph dislikes personal publicity so much that his photo does not even appear in Grand Met's annual report. His only boast is that he works a mere four hours a day. He delegates as much authority as possible. "I do not want to become a prisoner of wealth, weighed down by responsibility," he says. In his plentiful spare time, Joseph likes to visit the cozy pubs that he owns personally. He also reads voraciously, and has a large collection of novels with plots that are set in hotels.

There is hardly any way that his Grand Met shareholders can lose in the struggle for Watney's, even if management fights off the takeover bid. Grand Met already owns 10% of the brewer's shares and their price has soared during the fight. Says one of Joseph's old business adversaries: "That's our Max. Even if he loses, he always collects a consolation prize."

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