The Amchem Years
The development of the herbicide business
Throughout the 1950s the management of the company remained largely in the hands of Augustus James Marks. But he was increasingly involved with the commercial side of the company and took steps to ensure that other aspects of the business were not neglected. In 1950, after his brother Gerald had left the board (his sister Muriel had been appointed in 1941 but never took an active part in the business), Marks appointed the company’s external accountant,Alistair MacLaren, as a director to advise him on financial affairs. Marks was not a chemist and for technical advice he relied upon the two senior works chemists, John Walker and John Norris.Walker was subsequently appointed works manager. Marks was a sociable man, whose charming personality had been responsible for building up excellent relationships with many of the company’s customers, a necessity for the business given the sometimes poor quality of the products the second-hand plant was producing. By the late 1950s he had built up sales which hovered around £350,000 but net profits remained low and the seasonal nature of the spray business had made the company completely dependent upon its bank overdraft for working capital.
Although Marks was just 45 years old, he was not a well man. He was perhaps feeling the strain from shouldering almost the entire responsibility for the direction of the business since the beginning of the Second World War. His failing health prevented him from working full-time throughout 1958 and John Walker took over the responsibility for the commercial side of the business. In early 1959 Marks became seriously ill and he died on 16 February, two days before his 46th birthday.
A month after Marks’s death Alistair MacLaren was made managing director. Marks’s two sons were still boys but his widow Lucy joined the board, as did John Walker and John Norris. Mrs Marks became the company chairman and took an active interest in the business, coming into the office once a week on a Friday until she retired from the board many years later. In doing this, she was following advice given to the family once again by William Collinson who wrote to her emphasising the importance of keeping in touch with the works at Wyke. She kept up this contact until her death on 29 December 2000. Service agreements were subsequently drawn up early in 1960 for the three non-family directors. It is interesting to note from a present day standpoint that Alistair MacLaren pressed for a 12 year agreement although this was never ratified.This took him to the age of 60 by which time it was hoped that the two Marks boys would be active in the business.
In contrast, only three year agreements, a fairly standard length nowadays, were given to John Walker and John Norris, justified by comparison with the length of the managing director’s agreement on the grounds that the agricultural chemical industry was going through a ‘somewhat turbulent stage’.
The immediate problem faced by management was how to deal with the estate duties arising from Marks’s death. There had been no planning at all for such an eventuality. The company had little cash and paid only frugal dividends, while Marks had never received a large salary. In the end the problem was overcome when £27,000 was capitalised from profits in the form of six per cent unsecured participating loan stock. The stock, redeemable in January 1981, was issued in its entirety to theYorkshire Insurance Company and the proceeds used to settle outstanding death duties. Two years later at the annual general meeting in 1964 Alistair MacLaren proposed the public flotation of the company. He cited his own poor health, the introduction of capital gains tax, and the need for the family to diversify its interests outside its shareholding in the business. He did not mention that flotation would have been one way of injecting fresh funds into a business which had always been strapped for cash.The idea had no support from the family and Mrs Marks rejected it without any further investigation on the grounds that it was premature and should wait until her elder son, Augustus Rhys (Rhys), had joined the business in an executive capacity. Whether such a flotation would have been successful is another matter for the run of results with variable net profits over the past few years, the undercapitalisation of the business, and its close ties with Amchem would hardly have tempted outside investors.
Two years later Alistair MacLaren died at an early age and John Walker, who had been responsible for the commercial side of the business since 1959, took his place as managing director while John Norris continued as technical director. Rhys Marks, now 21, was appointed to the board but took little active interest in the business for several years. Alistair MacLaren, as a friend of the family, had encouraged Rhys to pursue a qualification in chartered accountancy. This he did before going on to spend some time working in industry in London.This gave him a wider view of the world and the time to consider whether he wanted to pursue a career in the family business. His younger brother would later decide his future did not lie in the family business and he eventually settled in the United States as a veterinary surgeon.
These changes had little impact on the direction of the company and day-to-day operations remained as they done had for some years in the hands of JohnWalker and John Norris. Then an approach came from Amchem which enquired about the possibility of taking a stake in Marks.The company was wary about this approach.A number of similar offers had all been rejected out of hand because Mrs Marks did not want to prejudice her sons’ interest in the business and because the company had always managed to finance its capital projects from income. On the other hand, Marks had become of considerable importance to Amchem since the early 1950s yet Amchem had no formal say over its direction.
After two years of discussion, it was agreed that Amchem would acquire nearly 25 per cent of the shares in Marks and take a seat on the board. Amchem took up its shareholding in March 1969 and J O J Schellenberger became the first Amchem board appointment in May of the same year. Amchem’s position had changed in the meantime since it had merged early in 1968 with Wm H Rorer Inc, a pharmaceutical firm, becoming known as Rorer-Amchem Inc.
Through the licensing agreement with Amchem, Marks was able to produce its own agricultural chemical products. These included homologs (that is, a chemical compound from a series of compounds that differs only in the number of repeated structural units) of the phenoxy acetics,MCPA and 2,4-D,and also of the phenoxy propionics (CMPP and 2,4-DP) and phenoxy butyrics (MCPB and 2,4-DB) with small volumes of chemicals, such as MCPA methyl ester and 2,4-D methyl ester, being supplied to the textile and dyestuffs industry. May & Baker held the patent for the phenoxy butyrics and Marks eventually obtained the contract make them for May & Baker since it was able to do so more cheaply. Shortly afterwards Marks received an enquiry from East Germany concerning the provision of technical assistance and supervision in the construction of a butyric manufacturing plant to supply eastern Europe. East German workers came over to see how the Wyke Lane plant operated and Marks personnel spent nearly six months in East Germany while the plant was being built.
Marks had been supplying phenoxy herbicides to ICI for some years to supplement the latter’s own production. As with May & Baker, this relationship, together with the experience Marks had built up over more than ten years in the manufacture of phenoxy herbicides, helped the company to secure the contract to supply ICI’s total phenoxy requirements in 1968 after its Plant Protection subsidiary decided to cease phenoxy production.
(In the following year the firm also won a three year contract to supply the UK herbicidal needs of Ciba Agrochemicals.) The additional business this brought required the firm to increase its phenoxy production capability. Another spur to increased investment in the site at that time was the growing demand for Marks’s products overseas.
Another herbicide sold by Marks as a result of the Amchem agreement was the heterocyclic nitrogen compound, aminotriazole. This had been introduced by Amchem in 1954 for the control of annual and perennial weeds. In 1961 in association with Amchem and two other parties Marks participated in a joint venture involving the sale of aminotriazole in what was then Malaya for the control of weeds in the rubber plantations. Marks expected that the new company, known asWeedone Products from the commercial name for aminotriazole used outside the United States, would yield decent profits and believed it would further cement relationships with Amchem (the formal licensing agreement had yet to be signed by the two companies). But the new venture was poorly managed and rarely profitable and Weedone Products was sold to Harrison & Crosfield during 1970 when Marks received half of its original investment back.
In the early 1960s Marks added a new range of herbicides as a result of Amchem’s research and development programme. Phenoxy herbicides were particularly effective against the so-called dicotyledonous weeds but others were more resistant. This meant there was an increasing problem with weeds which had not been much of problem in the past. Research was undertaken to develop herbicides which could tackle weeds like chickweed, mayweed and a number of polygonums in cereals. The herbicides which emerged were the nitriles. The first was dichlobenil, introduced by Philips Duphar for the control of annually germinating weeds in 1960. Shortly afterwards came the oxynils, ioxynil (3,5-diiodo-4-hydroxybenzonitrile) and bromoxynil (3,5-dibromo-4-hydroxybenzonitrile), contact herbicides developed particularly for the control of annual broad-leaved weeds, such as mayweed,in cereals. They were introduced by May & Baker,a subsidiary of Rhone Poulenc, in the United Kingdom and by Amchem in the United States. Both Amchem and Rhone Poulenc patented the oxynils at the same time, as had happened with Amchem and ICI over the phenoxy herbicides, and the two companies agreed to recognise each other’s patents and appoint licensees throughout the world. At Amchem’s request, Marks firstly developed the oxynil manufacturing process and then built and operated at Bradford the first large-scale production of oxynils in the world. £35,000 was spent on an ioxynil plant which became operational in 1964-65. Quality was initially poor and further improvements had to be made. The production of bromoxynil began in the same year. Order levels were much lower than expected during the first few years, with plant rarely working more than three months in a row, and production was supported by guaranteed minimum orders from Amchem. One drawback to the production of both the phenoxies and the oxynils was that Marks was dependent upon others for the supply of raw materials.
For the phenoxies, the company relied on Coalite, and for the oxynils, initially on May & Baker. When supplies were interrupted, the company often had no option but to shut down production and ration customers, which was not a satisfactory situation.
As far as other products were concerned, sales of picric acid received an unexpected but welcome boost at the end of the 1960s. ICI placed an order with Marks for the production of 90,000 pounds of picric acid a month for shipment to its subsidiary, Canadian Industries Ltd, on behalf of the United States government. This, it transpired, was in connection with the Vietnam war. Because of the hazardous nature of the acid, it was difficult to arrange its shipment and eventually containers were loaded at Wyke and transported by road to the port, where they were transferred to the Canadian Pacific vessel bound for Montreal. Upon reaching Canada the same process took place in reverse, so the acid was never touched from leaving Wyke Lane until reaching Canadian Industries. This was something of an innovation for the days of the container ship had just begun. The company recorded that they were sure that ‘this new method of transport’ would result in the consignment reaching the consignee in far better condition. The contract lasted until October 1971.
The market for agricultural herbicides, which had multiplied many times since the introduction of the phenoxies after the Second World War, was very competitive. While the company was continuing to develop export markets, particularly in Canada and Scandinavia, under the direction of John Walker, who travelled extensively all over the world visiting customers old and new, it was hindered in its attempts to penetrate western Europe as Britain was not a member of the European Economic Community until 1973 and British exports to EEC member states were subject to punitive tariff barriers.
Nevertheless, in 1966-67, exports for the first time exceeded sales in the UK, accounting for 51 per cent of turnover of £1.123 million. In the UK the company’s sales were for ever at the mercy of the British weather. In 1967 the board became aware that surplus stocks were making increased sales difficult – ‘This is a result of the very wet weather in May – distributors, merchants and farmers who had purchased supplies of weedkillers which they expected to sell or use were unable to get on the land or sell the products, and still have them in stock’. Sales were also susceptible to the unexpected. The consequences of the Arab- Israeli conflict of 1967 sent the price of many chemicals soaring because they were based upon petrochemical production. In the same year devaluation had the effect not of boosting exports but of increasing the price of imported raw materials and therefore manufacturing cost. The cost of all these events had to be borne by the business in smaller margins since contracts with customers had already been made.
While total sales of nearly £2 million that year had advanced substantially since the late 1950s, trading profits and net profits remained small. The company was reluctant to borrow in the long term for investment and the limited scale of annual profits dictated the company’s ‘make-do-and-mend’ philosophy of investment. The reluctance to borrow came from the company’s reliance upon its bank overdraft for working capital as a result of the seasonal nature of the herbicide business.
Until the end of the 1960s Marks remained a small company in terms of numbers employed. This accounted for the camaraderie which existed among the workforce, often found in small manufacturing businesses in the days when health and safety was not so tightly regulated. Close relationships in a small workforce produced a team spirit. Working at Marks was, remembered one man,‘a joy at one time’. Men were more than willing to remain behind after time if there was a job which needed doing. For example, a team of men would think nothing of working continuously for 36 hours over a weekend to replace a faulty glass-lined reaction vessel, weighing several tons, in the nitrating plant.
But the workforce was not a stable one. Labour turnover was high. It was so difficult to attract new workers to the factory that staff were even paid bonuses to try and persuade people to come and work at Marks. It was not uncommon for those who started on a Monday to have left by the Friday afternoon. There were a number of cases where men (and the chemical industry in terms of numbers employed has always been dominated by men) remained in the job for less than half an hour before deciding that work in a chemical factory was not for them – ‘They did not like what they saw when they got here’, recalled one worker.
A paper prepared for the board at the end of the 1960s noted that there appeared to be two main reasons for the difficulty in recruiting labour of a suitable calibre. Firstly, ‘our works are chemical works, and this is not a common industry in this area. Further chemicals are very much different to the processes in the wool industry and smells and conditions of working usually worse’. Secondly, most people preferred to work during the day rather than on a shift system. Relatively low levels of pay were another important consideration as was the fact that there was no sick pay.
Prospective employees were also put off by the very seasonal nature of the production work during most of this period. This took place largely from the autumn until the following Easter. In the summer months hours were usually from 8:30 am to 5:30 pm and the men had to turn their hands to all sorts of tasks. Plant and buildings were painted, odd jobs were carried out and plant was overhauled. It was not until the 1970s that the expansion of the company’s export business permitted production to take place more evenly throughout the year.
Process workers were supplied with working clothes every six months, second-hand reconditioned policemens’ uniforms, firemens’ uniforms, even brass band uniforms with gold stripes down the trousers. Rubber wellingtons were provided, with stocks of various sizes held for new starters and replacements, together with rubber gloves and aprons, as illustrated in photographs from the time. There were no hats but goggles were issued to workers handling acids and other corrosive chemicals.
The changing room was very basic, washing facilities consisting of two circular fountains, and the toilet facilities were barely adequate. The canteen served a hot meal each day but meals had to be taken in shifts since it was too small to take all the men at once.
It was hard, dirty work. There was little in the way of mechanical aids for many years and manual labour, with the assistance of blocks and tackle for lifting, was extensively used. Soda ash, for instance, was supplied for a long time in bags which weighed two hundredweight each. One local author wrote that men from the Wyke Lane works would be seen returning home ‘with bright yellow faces from the picric acid used there’.
Everyone had a streak of yellow on them, either on their hands or their faces or in their hair. Rhys Marks, the eldest son of A J Marks, would come down to the works with his father most Saturday mornings and play on his own in the plant while his father dealt with the post. His mother was furious when he inevitably returned home with yellow-stained hands.
Inevitably there were occasional accidents. One involved the experiment of an over-enthusiastic chemist with a particular interest in explosives, which blew out all the laboratory windows. He left to work for a major fireworks company and became well-known all over the country for his displays. A fire caused by a bunsen burner setting alight ether from a broken bottle destroyed the back laboratory. The tarred-sheeting roof of the production plant was burnt down when a pan being charged with caustic ignited – the factory water supply was insufficient to put out the fire. But serious injuries were rare and only two men have been killed in the course of their work on the site since the war. It was more common for men to suffer from dermatitis caused by a combination of dirty work and a failure to wash their hands properly. Medical inspections were carried out every month by a police surgeon.
All these factors, recorded the board in 1968, led to ‘a good deal of difficulty in attracting the type of labour we really need for the works, and have not had the production nor the quality of production out of the plant which we anticipated and hoped for’. For instance, for many years plant foremen supervised the night shift. Some men would produce as much as the previous night shift before stopping work to get some sleep. Several nightshift workers had their own hideaways for taking a nap. One was discovered hidden away on the landing in one plant, boarded out and painted inside with the hot water pipes taken in and out of it.
The impetus for change in working conditions and practices, which the company recognised was overdue, came from the award of the contract to produce phenoxy herbicides for ICI’s subsidiary, Plant Protection, in 1968. As well as extending and improving production capacity, Marks also overhauled its labour intensive handling of products by acquiring modern handling equipment, such as fork lift trucks and conveyor systems. (When the company continued to have recruitment difficulties in the early 1970s, the way the plant operated was reviewed at all levels to see whether further mechanisation was an economical alternative to manual labour.) A new wages structure and shift system was negotiated for the phenoxy units. From July 1968 the units moved from two shift working to three shifts which, it was hoped, would double production. Supervisors were appointed for the nightshift to ensure that quality as well as quantity was adequate. The men were paid a higher hourly rate which, the directors suggested, would attract ‘a better quality of operative and so more reliable working’. Sick pay was introduced for the first time. Similar plans for other parts of the site were under discussion. With the introduction of the three shift system and the employment of more men, a new, larger canteen was built, which came into use in January 1969, and improvements were made to changing, washing and toilet facilities.
The relatively primitive working conditions at Wyke Lane were due in part to the fact that the company’s relationship with Amchem determined that it neither had the need nor the opportunity to invest as much in the site as it would have wished. The licensing agreement gave the company a ready made range of popular products and a captive world-wide core of customers. Limited profits and a bank overdraft reinforced a natural tendency to think twice about borrowing. A shortage of capital compelled the company to pursue a policy of doing as much work as possible by itself. One former worker recalled that ‘We never had any money in those early days. If we wanted to build anything, we went around second-hand places buying things’. Picramate was stored in old rum barrels lined with plastic. Other finished products were stored in a dozen former 3,000 ton bulk milk tankers bought from a Wiltshire dairy. The foreman of the engineering department sought out cast-off machinery and brought it back to the site for reassembly. It was only in the late 1960s and early 1970s that the company began using contractors for plant and equipment. Even when Rhys Marks joined the company full-time in May 1973, the engineering department was still little developed and he described the site as ‘relatively primitive’.
Floods remained a regular occurrence and a hindrance to efficient production.At the end of July 1968, for example, a tremendous hail storm caused a flash flood which filled the works yard at Wyke Lane. Basil Turner, the works manager, refused to be distracted from the work in hand by staff anxious to warn him that his car was in imminent danger of being surrounded by flood waters. By the time he took notice it was too late and his car was afloat. The canteen was marooned and men went in to rescue the roast beef and pork pies, as well as the canteen ladies, who had taken refuge upon the range. Pots and pans floated into the yard and the electrician’s car was submerged up to its windscreen for three days.
Water supplies remained inadequate because of the small size of the water main supplying the factory. For this reason cooling water was recirculated wherever possible and recovered from the roof drainage. Effluent was either disposed of on site or taken by tanker to Esholt sewage works. One corner en route to the sewage works was known for a long time as Dawson’s Corner after one tanker driver caused a spillage there of brightly coloured picramate effluent. Old Lancashire boilers were used to store effluent on site. The sediment which formed inside the storage tanks had to be cleaned out regularly. This was a messy task which involved one man getting inside the tank itself, another keeping a close eye on him, and a third in charge of the water supply. Once the sediment had been washed out, it was dammed up on the ground where it was allowed to dry out before being carted away.
Throughout the 1970s the disposal of effluent remained one of the company’s major problems. At first most of it was sent for disposal to Bradford Corporation’s sewage works at Esholt.
In early 1970 the river authority began complaining of the quality of the outflow from the sewage works, compelling the Corporation to take measures which had the effect of reducing the volume of effluent which could be disposed of at Esholt. The company began measures to improve the quality of its effluent but the limitation upon the disposable quantity of effluent was curtailing production of phenoxy herbicides and proved ‘a serious embarrassment’ to the firm. Marks had to become very selective about the new products it made and sold as a result of this restriction, concentrating more upon the most profitable products. Increased profitability had to be looked for from more efficient production or from increasing prices.To compound this problem, the firm was affected by the sewage workers’ strike in the autumn of 1970 when Marks had to take its effluent to a special tip 50 miles from the works which was open only during the hours of daylight. Transportation costs soared – the total cost was £10,000 – and production had to be halved during the six weeks of the strike. The company was encouraged by continuing limitations upon the disposal of effluent to seek further reductions in the volume of effluent it produced. In the early 1970s £10,000 was spent on carbon towers to improve the quality of effluent from oxynil production and a new oxynil plant erected in 1974 was designed to produce less effluent and a purer product. But these measures did little to relieve the constraints placed upon the company’s expansion.This was going to be very difficult to achieve at Wyke Lane unless the company was able to find alternative arrangements for disposing of the greater volumes of effluent any expansion inevitably entailed. The company put some effort into seeking ventures with or taking over other manufacturers as one solution to this problem but without success. This failure led Marks to redouble its efforts in obtaining expanded effluent disposal facilities.
Then the new water authority,Yorkshire Water, gave notice to Marks to end the existing effluent disposal agreement in early 1975 and directed the firm to have processes in place for the neutralisation of its effluent by April 1977. In conjunction with Yorkshire Water, Marks began to develop an effluent neutralisation plant atWyke Lane, a project which was estimated to last at least two years and cost in the region of three quarters of a million pounds.The water authority agreed to extend the deadline given to the firm until the end of 1977 so that the necessary works could be completed.Trials were also undertaken with the discharge of effluent at Bierley sewage works and a licence was granted to the firm in 1981.
Another environmental problem which the company had to tackle was the occasional escape of herbicide from the plant and the damaging effect this had upon nearby gardens which brought the company unwanted and detrimental publicity.The company was also coming under the spotlight because of growing environmental awareness among the general public and the concern expressed about accidents occurring at chemical plants, such as at Flixborough at home and at Seveso abroad.At Wyke Lane itself there were fires in 1975 and 1976, the latter destroying buildings, plant and stock worth a total of £140,000. The local newspapers during 1976 (as a result of a campaign led by the local MP) carried articles about the supposedly hazardous nature of Marks’s operations. The company invited the MP and a group of senior Bradford councillors to tour the site.
The company was able to satisfy them completely ‘that the company is a responsible one and does not carry out any operations which are unduly hazardous to local inhabitants’.
Since the Second World War herbicides had had an enormous impact upon agriculture at home and abroad. They had permitted a significantly greater acreage of cereals to be grown and an increase in yield of more than 20%. Their effectiveness, together with improvements in farm mechanisation, had reduced the need for farm labour, even in the previously labour-intensive growing of fodder crops, and stimulated the emergence of new techniques, such as direct drilling. During the 1960s and 1970s pre-emergent herbicides were developed, applied to the soil before the crop had begun to grow, together with new herbicides which controlled difficult weeds in a variety of crops. All these developments increased the competition faced by the company, particularly in the market for phenoxy products.The company was not helped by industrial and economic instability at home during the early 1970s. Hopes of real expansion lay overseas and these were boosted briefly by the floating of sterling in 1972. The company’s plant worked at full capacity throughout the year including new oxynil and ester plants which had been erected to cope with the resulting rise in sales. During 1972-73 exports rose 43 per cent but any advantage from the floating currency was eroded subsequently by the escalation of inflation in the British economy.Then came the energy crisis, stemming from unrest in the Middle East, followed by the miners’ strike and the imposition by the government of price controls. There was an acute shortage of raw materials and the company was forced to ration its customers during 1974 and 1975. Chloro-propionic acid was particularly scarce, Marks’s supplies being cut by half.
The company’s great strength since the Second World War had making products which had been researched and developed, packaged and marketed by others. But this was also a weakness, for the greatest profits came not from formulation, which was relatively easy to undertake, but from primary production and marketing. The difficult years of the early 1970s had made all this even more evident.The company’s inability to obtain sufficient chloro-propionic acid, for example, illustrated the danger involved in relying on others for raw materials. In reaction to this, the company invested in its own chlorination plant which became operational in the autumn of 1977.With 30 tons of chlorine stored atWyke Lane, the site was declared a major hazard area, prompting further misplaced concern in the neighbourhood which took some time and effort to allay. By 1979, the company was not only self-sufficient in chloropropionic acid but was also making enough to sell commercially. There was sufficient commercial demand for the company to extend the chlorination plant further in 1980.The decision to build the chlorination plant had been taken not a moment too soon. So poor were the market prospects for phenoxy herbicides in Europe in the late 1970s because of falling prices caused by over-production, that Marks would have been unable to produce them profitably without price assistance from its raw material suppliers and the cost savings of making its own chloropropionic acid.
The company continued to look for new products in its quest for growth. It had supplied pharmaceutical intermediates on a small scale for many years, but Marks’s pharmaceutical customers now wanted fine chemical products of a higher specification than the company was supplying. Since these were more profitable than herbicides, a decision was taken in principle in 1977 to produce fine chemicals of higher quality in greater quantity. Although the immediate implementation of this proposal had to be deferred because of a decline in the fine chemicals market and the subsequent economic recession, this decision would be hugely important for the business. The main hindrance to finding new products was the soaring cost of providing toxicological data on products, particularly agricultural chemicals, required by the regulatory authorities in each country. A small company like A H Marks and Company simply could not afford the costs involved.
Other companies faced the same problem. It was solved by forming groups of companies, known as task forces, with an interest in similar products who shared the costs of providing the necessary data. Marks joined firstly the Apollo Club of European phenoxy manufacturers and then a similar group in the United States. Task forces covering other product groups were also established.
The economic situation worldwide was deteriorating. Oil price increases, the strength of sterling and high interest rates made 1978-79 a difficult trading year. Subsequently, as customers de-stocked, there was an increase in demand and the company recorded greater sales but Marks found it difficult to meet the increased world-wide demand for oxynil products and decided to increase production capacity. Record sales of more than £20 million in 1979-80 were not matched by record profits, hit by high interest rates and a strong pound which affected the company’s exports. Bad weather throughout the year also meant that sales were lower than forecast and the company was compelled to hold larger stocks than usual. After a comprehensive review, the board decided to reduce overall costs and all non-essential plant repairs, plant renewals and improvements were deferred. The labour force, which had grown significantly over the previous four years, was also cut back. As economic conditions worsened,and the UK market remained depressed, sales collapsed by a third. The export market continued to be difficult, because of the high value of sterling and fierce competition from European manufacturers. Nevertheless, exports fell only 8 per cent from the record level of the previous year, an effort which, together with the cost-cutting exercise, secured a small trading profit for the company. Competition remained acute and although record sales were achieved again in 1981-82, margins were further reduced. The company decided to maintain a presence in export markets despite artificially high sterling values and this paid off, with exports rising in excess of 40 per cent to an historic high of more than £14 million.
Throughout the 1970s the relationship between Marks and Amchem Products remained central to the company’s operations.The original licence was renewed for a further ten years in July 1972 but there was a fundamental change to the relationship during 1976-77. The agricultural interests of Rorer-Amchem, which had become peripheral to its major pharmaceutical business, were acquired by another American industrial giant, Union Carbide. This raised a question mark over the continuation of the licensing agreement after 1982 since, unlike Amchem Products, Union Carbide was also a manufacturer of herbicides and pesticides. Because of this major difference, Union Carbide was not content to maintain a shareholding in Marks which was neither a controlling interest nor produced a generous dividend so overtures were made to purchase the entire company. This was something the family was not prepared to accept. Rebuffed, Union Carbide decided to sell its 24.9 per cent shareholding. Marks was able to take advantage of the provisions of the 1981 Companies Act which gave companies the right to buy back their own shares. Union Carbide agreed to accept the sum of £830,000 in return for its stake. This seemed a considerable burden upon the business at the time but the sale agreement provided for the payment of this sum over three years.
At the same time, to safeguard Marks’s position in the medium-term, the licensing agreement was extended for a further period of five years.