Parker's next patient

IT HAS been a busy summer for Sir John Parker. A few weeks ago, he saw through as chairman the disposal of several local gas networks owned and operated by National Grid Transco for £5.6bn.

Today he announced, also as chairman, the sale of concrete manufacturer RMC to Mexican giant Cemex, currently the third-largest cement producer in the world. The price this time was £2.3bn, a hefty premium of more than 40% to the level at which the shares traded last week.

Cemex could have bought RMC a lot cheaper two years ago but it would have been taking a big risk. When Parker was parachuted in, the business, dragged down by acute problems in Germany and thrashing around without a clear strategy in the UK, was in severe difficulties.

Parker cleared out the board, re-established control and direction and a year ago brought in the quietly impressive David Munro as chief executive.

The result has been a transformation in the group's fortunes which Cemex has spotted and now wishes to take advantage of.

Almost as interesting as the fate of RMC is what next will be in store for Parker. He clearly has an appetite for transformation and there is no shortage of businesses in need of such change.

The only constraint is that several of these are among our largest companies and, as chairman of National Grid Transco, he is caught by the stupid corporate governance rule that prevents him adding a second FTSE 100 chairmanship to his portfolio.

Gordon's gap

CHANCELLOR Gordon Brown's speech to the Labour Party conference in Brighton today is unlikely to win him friends in the business community, but he tends not to tell the faithful what they want to hear either.

Business can't understand how, in the face of all the evidence, Brown continues to think changes in tax and other minor incentives will change the way people, business and society behave.

Their bemusement becomes irritation when they have to cope with the cost of all the complexity and regulation he has imposed.

The party faithful find his mantra about competitiveness in employment markets pretty wearing too.

But it could be that a bigger problem for the Chancellor is that people forget. We still talk about the boom and bust years, but how many people remember the detail - the bankruptcies and the unemployment?

Instead we have come to see stability as the norm and take it for granted. We forget how rare it used to be and that at least some credit is due to the Government and the Bank of England's monetary policy committee, which Brown created.

An even bigger issue is confidence. House prices are wobbling and that, coupled with Brown's passion for investment in public services, makes people worry about the risk that the economy will buckle under the tax burden.

So if trumpeting economic successes is to be a major plank of the strategy for Labour winning the next election, it would be wise not to delay that election too long.

Sainsbury's fate

PERHAPS the most successful deal that American private equity firm KKR ever did was to buy Safeway almost 20 years ago.

It then sold the British end of the company to James Gulliver's Argyll Group, which took the Safeway name and developed the British business while KKR used the cash Gulliver paid to help revitalise the American business.

I have said before that Sainsbury will end up in the hands of a private equity firm. Only then will it have a management single-minded enough to strip the business back to its profitable core and shareholders who support it in that. KKR showed what can be done, but it is unlikely to be attempted under Sainsbury's present owners.

As long as family trusts dominate the share register, the executive in charge will be looking over his shoulder and constrained not to depart too far from Sainsbury's traditions and what the family sees as its place in the market.

Given Sainsbury's assets and the opportunity for a slimmed-down group to do very well, it is no surprise that Permira, which has shown a considerable appetite for retail assets, should reportedly be taking a hard look at it.

But such a bid is likely to be a long way off. Even in its current straitened circumstances, Sainsbury is still a £5bn group and a massive gamble for any private equity house.