The head of Scotland’s leading engineering body has attacked City analysts for downgrading the engineering sector, blaming them for a spate of take-overs.
Labelling the analysts ‘overpaid, over-rated louts’, Peter Hughes, chief executive of Glasgow-based lobbying group Scottish Engineering, said: ‘Who are these stock market analysts who repeatedly undervalue engineering stocks? They wouldn’t know a good company if one fell on their heads.’
Hughes, whose association represents more than 350 engineering firms in Scotland, was addressing members of the Institution of Mechanical Engineers last week.
‘We will not be done down by those outside our industry whose actions seem hell-bent on making life difficult for us,’ said Hughes.
In recent weeks, Scottish companies, including pumps manufacturer Weir Group and the smaller engineering firm Clyde Blowers, have been the focus of bid speculation, joining the growing list of engineering companies whose low market valuation has attracted potential bidders. Blowers has received a £24m bid and Weir has been linked with US industrial group ITT.
Both companies’ shares have taken a hammering despite improved financial results. ‘If companies are ripe for takeover it is because of analysts’ actions,’ said Hughes.
Speaking to The Engineer, Hughes said the climate in Scotland for engineering was tough but better than the rest of the UK.
However, he warned that more job losses will follow and not just in electronics, which has been the hardest-hit sector to date.
‘Firms continue to stress difficulties because of the high pound and high interest rates,’ he said.
Scottish Engineering estimates that 10,000 12,000 jobs have gone in the Scottish engineering sector in recent months.
Hughes wants to see an immediate half-point cut in interest rates, dismissing the October quarter-point cut as ‘derisory’.