Corporate failure is not uncommon in Britain - it is very prevalent amongst the largest companies, which are subject to the most intense scrutiny and pressure from the financial markets and press.
This pressure tends to cause managements to be acutely aware of the need to please a critical audience of investors. Unfortunately, investors are a widely diverse group, ranging from those who care about the long -term future of the companies that they follow to those who simply speculate on short-term share price movements. Trying to please investors and taking care of the best long - term interests of companies have become almost mutually exclusive objectives.

The Redland case is one of long-term success and increasing ambition, to the point that Redland eventually entered the top half of the FTSE 100 and became the largest construction materials company in terms of market capitalisation. At its peak, the company was lionised by the investment community ("Redland's attention to shareholders' needs is peerless"), voted Most Admired Company in its sector and lauded by the press.

Its top managers were clever and, in the main, had close affiliations with the bankers and other advisers that they used to support their strategy of growth by acquisition. As time went on, the acquisitions became more and more ambitious, until the biggest deal, the acquisition of UK rival, Steetley.
When the bidding war was over, Redland apparently stood proudly at its apogee - the clear leader in its industries.

But inside the company, the story appeared to be quite different. This Case chronicles the sudden fall from grace and bewilderingly rapid demise of the company from an inside perspective.
The authors believe that the Redland case is all too typical of companies that rely on pleasing the investment markets and that follow an 'exciting' deal-led path to corporate growth.

A version of this Case was used for some years by the Institute of Chartered Accountants as their main vehicle for teaching Business and Financial strategy and Corporate Governance.

The Tutors' notes for teaching the Case are included. They were compiled by Bill Tait of Prometheus Consulting quite separately from the authors of this version of the Case.

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