§ Mr. Trippier
asked the Secretary of State for Industry what changes are being made to the Government's guarantee for International Computers Ltd.
§ Mr. Kenneth Baker
The present arrangements consist of a guarantee of £150 million of overdraft facilities and £50 million of redeemable preference shares held by ICL's principal banks. ICL has now announced its intention of redeeming a first tranche of £20 million of preference shares on 5 April 1983, and the remainder in three equal tranches of £10 million each on 31 March in each of the three following years. Within the overall limits of the total tapering guarantee to IC1, which my right hon. Friend the Secretary of State announced to the House on 27 November 1981, the Government will therefore be guaranteeing £30 million of preference shares in 1983–84, £20 million in 1984–85, and £10 million in 1985–86.
The rights issue which ICL has announced, together with the encouraging return to profit in the company's results for 1981–82, will further strengthen ICL's finances and reduce the extent to which the guarantee in respect of 449W loans may have to be used. ICL reported that at 31 March and 30 September 1982 there was no recourse to the guarantee other than in respect of preference shares; ICL has made use of the loan guarantee at some times in its past financial year, but to a relatively small extent.