CTW ROILED BY DIRECTORS' DISQUALIFICATION

LONDON-Lloyd's of London members agency Cox Tudsbery & Wills Ltd. could become an acquisition target after a recent court ruling banned two of its directors from running a company in the United Kingdom.

David Coulthard was disqualified as a director for four years, and Hugh Shuttleworth was banned for five years, because of their conduct as directors of agency Dawes & Henderson (Agencies) Ltd. in an action brought by the U.K. Department of Trade and Industry.

Another Dawes director, Alan Dawes, was banned from holding a directorship for three years. Dawes & Henderson was put into voluntary liquidation in 1993, four years after the Cox Members Agencies Group bought it.

All three men admitted to breaches of the Companies Act 1985 involving more than (British pounds) 500,000 ($817,000) of loan arrangements between Dawes and its holding company, Hendal Ltd. The High Court also ruled that Mr. Shuttleworth gave preference to one creditor.

In a statement, CTW's board said the sentence on the three men was harsh, particularly because none had gained personally, all Dawes creditors had been paid and the men had relied on professional advisers.

CTW said it will have new Lloyd's-approved directors in place by the time the ban becomes effective Feb. 25. The directors likely will come from outside the agency and will be non-executive directors, said CTW Director Nick Paterson-Morgan.

CTW will review its options in the next few days, including whether to merge or be acquired, he said. The agency has had discussions with possible suitors over the past couple years, but talks foundered because of the Dawes situation, he added. One possibility is a linkup with Lloyd's corporate capital investors, similar to Angerstein Underwriting Trust P.L.C.'s recent takeover of Lloyd's agency Stace Barr Holdings Ltd. (BI, Feb. 3), though no deals are pending, said Mr. Paterson-Morgan.

Meanwhile, the Angerstein take-over of Stace Barr may have started a trend. Last week, ALIT Insurance Services Ltd., a subsidiary of Abtrust Lloyd's Insurance Trust P.L.C., agreed to buy members agent Minories Underwriting Agencies Ltd., pending Lloyd's approval of the deal.

As a corporate spread vehicle, placing capacity with a number of Lloyd's syndicates around the market, Abtrust sees its future lying more with individual members rather than with dedicated corporate members, which support just one syndicate. "We are looking to align with the traditional market and not go down the insurance company route," a spokesman said.

Adding Minories' (British pounds) 360.9 million ($611.5 million) in traditional members' capacity to Abtrust's (British pounds) 53.2 million ($90 million) means that Abtrust will control at least 4% of Lloyd's 1997 capacity.

"We will look to be acquisitive (of more members agents)," said Colin Percival, managing director of Minories and chief executive-designate of ALIT Insurance Services. This sort of deal gives agents economies of scale, which allow them to cut costs and improve profitability, he added.

Minories caused a stir last spring by filing for court protection from bankruptcy after failing to settle a dispute over a (British pounds) 4 million ($6.1 million) errors and omissions claim with Gooda Walker and Feltrim names action groups. French insurers writing part of the coverage disputed the claim (BI, March 18, 1996).

Minories came out of administration in late October, once the R&R plan was fully in place. It had upped its contribution to the settlement in exchange for Lloyd's taking over legal action against the defaulting insurers.