My First Million

September 11, 2009 6:09 pm

My First Million: Gerald Ronson

Gerald Ronson, 70, left school at 14 to start work with his father in the furniture business. He went on to found property development company, Heron Group, in 1956.

He also brought the first self-service petrol retail outlets to the UK in the 1960s.

He has overseen the expansion of Heron Group – now called Heron International – and remains chief executive. The Heron Tower is set to become the tallest skyscraper in the City of London.

In the late 1980s, he became embroiled in the Guinness share-trading fraud. He was found guilty of conspiracy, false accounting and theft, was fined £5m and served six months at Ford Open Prison. Years later, the European Court of Human Rights ruled that it had been an unfair trial.

In 1991, the US savings and loans crash cost Ronson nearly $1bn, but he managed to avoid bankruptcy. He has just written Leading from the Front – My Story.

Did you think you would get to where you are?

I left school at 14 and went into my father’s furniture business. By 17, I was works manager. When my father came out of this business in the late 1950s, I did not want to follow him.

Life has its ups and downs and I had two of the biggest downers – the Guinness trial followed by a drastic restructuring of Heron 18 months later. I had to rebuild Heron’s reputation. Luckily I am a survivor. If you can make money once you can make it again.

Have you ever thought about slowing down?

I was probably worth more than £1bn back in the late 1980s, when my business was making £69m profit. I was certainly not slowing down. I just stepped up a gear!

Outside of Heron, my interests are petrol retailing, financial funds and property. I know my petrol business as well as a
pulse on my wrist. If I put my finger on my wrist I can feel the business pumping.

What is the secret of your success?

I suppose it is persistence, determination and focus, and putting all these qualities together. I’m very energised, very driven, with a bit of insecurity and a bit of ego.

Have you had time for personal financial planning?

I regard my financial affairs as tidy. I don’t have a mortgage. I decided after my last escapade in the early 1990s that I wasn’t going to owe any bank any money personally. So, personally, I am debt-free.

What is your basic business philosophy?

I do things that I understand. If I can’t work out the figures on the back of an envelope, then I should not be doing the deal. I’m happy to look at opportunistic transactions. I am not an institution, I don’t think like one and I don’t want to end up in one.

Do you want to carry on till you drop?

Of course I do, providing my health stays good and that I continue to enjoy what I’m doing. I’ve got more energy in me at 70 than two 35-year-olds. I’m not planning my retirement. What would I do?

Have you made any pension provision?

Yes, I’ve got a self-administered scheme. I draw on it already because of my age, as well as taking a salary, although I pay quite a lot of tax on it.

Do you allow yourself the odd indulgence?

I enjoy my little Porsche twin turbo. And I have good holidays. I take short holidays to exotic places, from Vietnam to Mauritius, and I like to travel first class. That’s about it. I like to be comfortable. For a rich man, I live fairly modestly. I have had the same home in Hampstead for 41 years, and the same wife for 42 years.

Picasso or Art Deco as an investment?

I’m not into art, because I am not an expert. I invest in funds, property and equities.

What is your commitment to philanthropy?

I have a strong social conscience. Twenty per cent of my six and a half-day working week I devote to charities, especially in the areas of education for the underprivileged.

I have raised more than £100m for major charities over the last 25-30 years. I have also given away £35m of my personal fortune to good causes.

About three years ago,
I set up the Gerald Ronson Charitable Foundation,
to which I will bequeath
all my Heron shares. The foundation gives away
a seven-figure sum each year.

Have you taken steps to pass on your wealth?

My estate is well organised in terms of X going to the foundation, Y to my children and grandchildren, and the balance to ensure that my wife is financially independent should she succeed me. But I’m not planning to go anywhere and neither is she!

The foundation will grow and grow and that is the greatest asset I can leave my grandchildren and great-grandchildren.

What is your most prudent investment?

It has to be my wife and my family. We have four lovely daughters and six grandchildren. The whole purpose of my book was for the family to understand their heritage, as they are going to be trustees of a major foundation.

What is the most you have ever paid for a bottle of fine wine or champagne?

I might have paid £80 for a bottle of wine in a restaurant, and a similar amount for champagne.

What is your money saving tip in the recession?

We are currently in uncharted waters, so
caution is most important.

Keep an element of financial liquidity and don’t become too financially aggressive.

A lot of equities are good value. I have put a toe
in the water in a modest way over the past few months.

The day we put all our money in the bank, we are going backwards.

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