This is a deeply unsatisfactory outcome, and not just because a brass plate on an office suite in Edinburgh fools no one.Scottish Nuclear is not obviously a better and more efficient company than Nuclear Electric. Did he get it? When the time came, MAM sold him down the river in the way its fund managers had with so many other highly performing companies. If the same fate now awaits MAM, Mr Dyke would be forgiven a feeling of quiet satisfaction.An unsatisfactory nuclear outcomeThe sight of plucky little Scottish Nuclear fighting off the big bad English barons of Nuclear Electric warms the heart, but the campaign was probably doomed before it began. This is a government in such dissarray and so desperate for tax-cutting revenue that it will scrape the bottom of the barrel to find it.Because of the haste to find a package that will be half-way presentable to the City in a year's time, Scottish Nuclear and Nuclear Electric are to be merged under a single holding company that advisers believe will be simpler to sell. LWT, after all, could not have been accused of failing to deliver the goods to its shareholders; it was a well managed, high-growth company - not unlike MAM. Something similar was proposed by Greg Dyke, then chief executive of LWT, in the face of a hostile bid from Granada He deserved a hearing.
This was not, however, a strategy that MAM found very convincing when it held the fate of London Weekend Television in its hands. The only problem is that once fully independent, with its shares broadly held in the City, it becomes that much easier to acquire, and plenty out there want to acquire it. Out of the frying pan into the fire.MAM's best course, insiders insist, would be to form a strategic alliance with a similar fund management business in the US or on the Continent The two might even take cross-shareholdings in each other. Though majority-owned by Warburg, it has always been keen to emphasise its independence and for choice would have cut its ties altogether It may finally get its chance.
Whatever the speed, it is clear that if this scenario holds good, the impact on the housing market of a further tightening in monetary policy will be less than in the past.A taste of MAM's own medicineIf the stock market tom toms are to be believed, Mercury Asset Management will soon be getting a taste of its own medicine. If they wait for the incursion to become large-scale, the decline will be more gradual. New lenders like Direct Line could do to mortgage lending what they did to general insurance selling: take the market by storm bringing down prices - the margin - in the process.If building societies seek to fend off the new entrants from establishing a position, it will drop quickly. A recent report by Merrill Lynch argued convincingly that margins between borrowing and lending would halve from their current 2 per cent The only question is how quickly. And Halifax , which normally sets the lead, has said that even if there is a rise after today's meeting it will not pass it on in full.With transactions in the housing market currently so low, this apparent munificence is less surprising than it might seem. Like retailers', building societies' margins are under pressure from consumers who are willing to shop around in a way not shown in the 1980s.There is probably more to come. If they raised their lending rates by more than an increase in base rates, that potency was increased; if by less, it was diminished.Judging by the past three months, monetary policy is down on its testosterone count, certainly as far as the housing market is concerned.