Sir Jim Ratcliffe: Man U mogul

This BBC podcast is supported by ads outside the UK.

Want to stop engine problems before they start?

Pick up a can of CFOAM motor treatment.

C-Foam helps engines start easier, run smoother, and last longer.

Trusted by millions every day, C-Foam is safe and easy to use in any engine.

Just pour it in your fuel tank.

Make the proven choice with C-Foam.

Available everywhere.

Automotive products are sold.

Seafoam!

Suffs, the new musical has made Tony award-winning history on Broadway.

We demand to be home.

Winner, best score.

We demand to be seen.

Winner, best book.

We demand to be quality.

It's a theatrical masterpiece that's thrilling, inspiring, dazzlingly entertaining, and unquestionably the most emotionally stirring musical this season.

Suffs, playing the Orpheum Theater October 22nd through November 9th.

Tickets at BroadwaySF.com

BBC Sounds, music, radio, podcasts.

Welcome to Good, Bad Billionaire.

Each episode we pick a billionaire and we find out how they made their money.

Then we judge them.

Are they good, bad, or just another billionaire?

I'm Sing Sing and I'm a journalist, author and podcaster.

And I'm Simon Jack and I'm the BBC's business editor.

And this episode we've got someone whose name has been in the news recently, particularly if you're a football fan.

That's right.

He's been described as Britain's most successful post-war industrialist, but is also a massive Man United fan and now part owner.

It is Sir James Arthur Ratcliffe.

Now he's the founder and boss of INEOS, one of the world's largest chemical companies.

He's got a net worth of over $20 billion.

That puts him around 90th in the world, but very near the top of the tree in the UK.

And INEOS is big.

It has 194 sites across 29 countries.

It employs 26,000 people and it generates a cool $65 billion a year.

And Ratcliffe is also the first British-born industrialist to top the Sunday Times rich list of the richest Brits.

He's also sports mad.

In 2023, he spent over a billion pounds to acquire a 25% stake in Manchester United and crucially take control of football operations.

So he'll be the man in charge.

He is also a fan of water sports.

He's invested in sailing spending £110 million on Sir Ben Ainslie's thus far unsuccessful attempt to win the Americas Cup.

He's a big cyclist and he bought multiple Tour de France winning cycling outfit Team Sky and renamed them the Ineos Grenadiers.

And the company also sponsors the Formula One team and they have a partnership with the All Blacks rugby team.

This is a guy who just absolutely loves sports.

He also loves spending his money.

He has two super yachts, Hampshire and Hampshire 2, which cost £120 million.

And they have a deck that can be transformed, yes, into a sports field.

And a zip wire down from the crow's nest.

That sounds like fun.

He also owns several homes across England, a pub in Knightsbridge.

Called the Grenadier, by the way.

Yes, have you been?

I have been to it.

Well, I'll say I've been to it.

I've walked past it and someone's pointed out that's Jim Ratcliffe's pub.

Oh, well, if you're ever in the Neil Forest, you can also visit his hotel.

He's also got salmon fishing interests in northern Iceland.

So a man of many interests.

So let's listen to him discussing his business model on the BBC in 2016.

What we've essentially done is we've bought unfashionable chemical companies, companies which have a degree of cyclicality about them which public companies don't like.

They like things which are much more predictable.

And so we've taken some of these unfashionable businesses and we've just tried to run them a little bit better.

Asset stripping, I don't think, is relevant because we haven't stripped the assets or sold off the assets.

We don't really sell things.

But what we try and do is focus on them, invest in them, expand them, de-bottleneck as we call it, try and run them a bit better, try and manage them with a sensible cost-effectiveness so they're competitive, and grow them.

And most of the businesses in INEOS have grown fairly substantially over the years.

What we try and do is double the profitability of the business in five years.

Which is pretty astounding.

And I mean it's paid off.

It's quite difficult, but it can't be done.

I mean you've got operations all over the world.

Your turnover annual turnover of the whole group is depends on the oil price, but sort of 40 to 50 billion dollars today, so it's quite big.

Pretty astounding.

Is that an accurate kind of description of how he runs his companies?

I think it is.

And if you know he has that cycling team.

Very interesting that he brought in a guy called Dave Brailsford to run Team Sky, or it was associated with him.

Now Brailsford was the one who ran Great Britain's cycling team in the Olympics and had this mantra of continuous marginal improvements, like make it just a bit lighter, do the gearing just a bit different, maybe

shave your sideburns or anything to give you like a little bit of an extra edge.

And I think that is the way he approached it.

Tough, you know, professional northerner in many ways.

You know, that's the kind of attitude he brings to it.

He famously once said, I've never had a sick day in my entire professional career.

So that gives you a little sense of where he's coming from.

Right, and what he's now in his 70s.

So that's a lot of decades to go without taking a sick day.

All right, but he's in his 70s now, but let's go right back to the beginning.

He had humble beginnings in Northern England.

He was born in 1952 in a town called Failsworth, now in Greater Manchester.

Yep, grew up in a council house.

His father Alan left school at 14, worked as a joiner.

And his mother worked in the accounts department of the local council.

And as you can imagine, him and his brother Bob were instilled with a very strong work ethic.

Cycling from a very early age.

In fact, he would cycle 20 miles every day to school.

There's no way that would ever happen in my life.

No, I mean 20 miles, even if it was 20 miles there and back, that is an enormous amount of time to spend cycling.

He says that he learned to count by adding up the chimneys he could see from his bedroom window.

This is proper coronation street stuff as well.

Oh yeah.

And crucially, for you know a later part of this story, his childhood home was also less than eight miles away from Old Trafford, which is the home of Manchester United.

He is obviously a lifelong supporter.

And now he part owns it.

When he was nine, the family moved, though, to Hull because his father got a job running a factory, making lab equipment for chemical companies.

Note that.

And it was here in Hull he got his first weekend job, which was selling gold and gold lottery tickets at the Hull City Football Club.

He says, I wore the team's kit, got a free seat, one of the best in the ground, and loved it.

And he's a smart lad.

He got into a very good school up there, Beverly Grammar, which apparently, I didn't know this, the oldest state school in the UK founded in 700 AD can this be right I mean it sounds almost too good to be true but you know if any Beverly Grammar alumni are listening to the podcast please do let us know if it really is the oldest state school in the UK probably not from the early years if it is in fact 1300 years ago but whilst he was there his focus was still on sport he said I just played football that was all I was really interested in but he also ran the school's industrial society which mainly seemed to involve organising tours of paint factories and chemical plants.

And he says of this time, I suppose I did have this inkling that I wanted to be successful, that I wanted to be a millionaire one day.

But I was just dreaming really, in the same way you dream of being a Premier League footballer for Manchester United, I'm sure.

Be honest, if someone said, who wants to go on the tour of the chemical plant or the paint factory, would you have put your hand up for that one?

I think I would have rather stayed in the classroom reading a book.

Yeah.

But we're getting inklings of his future there from his past.

He studied chemical engineering at the University of Birmingham.

He picked Birmingham over the more prestigious Imperial College because he said, I'd never been to London.

I think it's interesting he didn't, he wanted to go to Birmingham rather than London because he'd never been to London.

There is a very much northern focus in the way he approaches stuff, both in his industrial outlook.

He says, I've got a bit of the Industrial Revolution in my DNA.

I think that's beginning to shine through.

And of course, the North being the home of the Industrial Revolution.

Correct.

So he joined BP, British Petroleum in those days, as a graduate, but had to leave after three days when they discovered he had eczema, which was thought to be a bit of a risk for someone working with chemicals.

Gosh, imagine if you turn up for your second day on the job and he said, is that a rash on your neck?

Do you have eczema by any chance?

So he decides working in a lab isn't for him and he tries to convince BP to take him on as a trainee accountant instead.

And BP say no, but luckily a company called Beacham Pharmaceuticals do take him on, and very soon he moves on to another company called ESSO, who fund him to do an MBA at the London Business School.

So even though he didn't want to go to London in the first place, he ended up there anyway.

I think this is interesting because he's always talked about I'm into you know chemical factories, paint plants, I want to work in the science end of the engineering thing but he then asked them to take him on as an accountant and he does an MBA at London Business School.

This is the crucial nexus if you like between industrial thinking and financial thinking.

Because it's their London Business School, he gets a fascination for corporate finance, especially when it comes to analyzing a company's assets and its liabilities.

And he says it is all about money and the numbers, the finance side, that's a critical part of his DNA.

And it will become a very important part of how he approaches buying companies.

Right.

Deal making is all important to how he builds his fortune.

And when it comes to deal making, you've got to look and see whether the numbers make up.

So he leaves SO and spends the next seven years at a man-made fabrics and chemicals company, Courtolds, quite a famous name in the UK many years ago.

That had over a hundred subsidiaries and they gave him the autonomy to run a division.

And he said, if you didn't sell 40,000 tons, the factory closed down.

The customers weren't nice.

It was real life stuff.

So he's kind of got a nose for the unglamorous side of things.

You know, this isn't a guy who spent the early years of his career kind of helping himself to the free breakfast bar and chilling out on the weekends.

No.

And also interesting about this, the way this business was structured, that it was, he had autonomous divisions who sort of ran it almost separately.

Do you remember when we were talking about L VMH, Louis Vuitton, Merit Hennessy, how Bernard Arnaud had that same culture, make them all kind of like individual businesses?

Like individual fiefdoms competing against each other.

But then an important call comes from a headhunter in 1987, and he describes this as one of the crossroads in his life.

So Advent, which is a US venture capital firm, offered him a job as a director focusing on investments in the chemicals sector.

And they tripled his salary to £90,000 per per annum.

And that is quite a lot of money in the 80s.

Are you kidding?

That's a fortune.

And also, interestingly, the money you get paid in finance firms is vastly, you know, it dwarfs what you get in the normal industrial kind of way of life.

And venture capital, you know, just to make that perfectly clear, are companies who spot opportunities, privately fund it, and when they hit the jackpot, they win big.

And speaking of getting better deals and hitting it big,

Advent also offered him a white BMW 535i,

which was apparently better than the one that the chairman of Cortotes had.

So, you know, clearly trying to sweet talk him over to the dark side.

White?

I don't want a white BMW at that age.

A white BMW signals to me that wherever you drive, it'll never be anywhere muddy or dirty.

That's a BMW drive to Harrods and back.

And it's this shift to venture capital that presents him the opportunity to set up his own business.

So at the relatively advanced age of 40, which is, you know, quite a bit older than some of the other billionaires we've covered on this podcast.

A lot of them have made billions by the age of like in their late 20s, early 30s.

Or some of them by their mid-20s.

So Sir Jim Ratcliffe becomes an entrepreneur.

He teams up with an entrepreneur called John Hollywood.

They seize the chance to lead a buyout of a chemicals business from oil and gas multinational BP.

So you remember hearing Jim Ratcliffe talk about his approach to business?

Well, he applied it to this kind of flailing company.

He was convinced with Hollywood that they could streamline it and make it profitable.

They're so convinced that Hollywood sells up his own business to focus on this.

And this is part of a pattern.

They basically, in these sprawling empires, whether it be BP, ICI, others, there are divisions which have gone unloved and they think they can take over and focus on and make them better.

Right.

And from the original owner's perspective, are they more than happy to just let go of this additional?

It's not their focus.

It's not core.

Forget it.

Let's let someone else do it.

Well, Ratcliffe gambled big.

You know, he actually mortgaged his own house in order to put up £141,000 to buy this company.

But it was very, very far short of what they needed.

They needed like £37 million.

But they get it.

£10 million comes from his employee Advent, and he got significant chunks from various banks led by the Bank of Scotland.

So Ratcliffe at this point says, I was 40 years old.

It was a very critical part of your career path.

If it goes wrong, you've lost all your money and completely screwed up your career.

So he had an idea of the stakes and the stakes were very high.

And he is a gambler.

And it's interesting that thing about being 40.

Speaking as a bloke

and having done some work on mental health for professional men, around 40, 45, that's the moment when you're either going somewhere or you've kind of plateaued.

That's so interesting.

Does it dovetail with the traditional age for the midlife crisis?

Yeah, it does.

And in fact, to introduce a rather somber note to this, my own dad took his own life when he was 44.

And I did a documentary about it.

And it

turns out that 40 to 45-year-old

age group is the absolute sweet spot.

And that is because, you know, testosterone is draining out of your body.

You're not quite the guy you were.

Basically, if you're not going to make it at work, you know by then.

But at the same time, your life's at its most expensive in that you've probably got children who are dependent on you and all that kind of stuff.

So life crowds in on you so 40 i think is a really interesting moment where you either break for the border or you go home oh gosh i didn't know that i'm so sorry to hear that that's all right that's all right it's a long time ago and uh but it's an interesting thing about mental health for men in the workplace i think right so 40 is the age at which you've started to make it or you've made it yeah and if not you start looking at your own life.

Yeah, sometimes I think that's right.

But anyway, back to Jim Ratcliffe, who is very much still with us.

Well, and he's also mortgaged his house.

So he's chosen to gamble big.

Yeah, by September of that year, 1992, the deal is almost done.

But then comes something called Black Wednesday, which many people listening will remember.

This is when the UK,

there was an attack on the UK pound.

Sterling fell precipitously.

The government put interest rates up to 15%.

It was a big year in finance.

And when you say attack on the pound, what do you mean?

What I mean is that speculators, in particular a guy called George Soros,

started selling sterling aggressively.

What are they doing?

Shorting the pound, which is like borrowing pounds to sell to try and drive the price down, betting the price would go down.

So it was a big assault, if you like, on the financial integrity of the UK.

And George Soros, for those who might recognise the name, is also a billionaire.

I'm sure we will cover him at some point.

We sure will.

So it's Black Wednesday.

The deal is nearly done, but the Bank of Scotland almost calls off their support.

Yeah, they do.

because interest rates have risen very briefly to 15%.

John Hollywood, his would-be partner, disappears off to Barbados.

Ratcliffe thought he'd lost his house.

But Chancellor Lamont's announcement that Britain would leave the European exchange rate mechanism, therefore take some of the pressure off, saw interest rates come back down again to 10%.

The deal is reprieved.

And Hollywood returns from Barbados.

Wonder what he was doing there.

And International Speciality Chemicals, aka InSpec is born.

I don't know if, you know,

Hollywood comes back saying, oh, I'm back from Barbados.

I figure like, you know, come on, mate.

Where were you when the going was getting tough?

But they've got their hands on their company, InSpec.

He's the chief executive with a stake in the business.

Hollywood is chairman, and he quickly goes about cutting costs.

And soon, InSpec is expanding.

And within a year, they buy two American chemical companies, one for $20 million and another for $17 million.

And InSpec is successful by increasing profit margins on products rather than increasing the volume of production.

And it means they can corner some areas of the chemical market that the bigger manufacturers, have we already said, had considered costly, too complex to compete in.

It's not their core business.

We're not focused on it, but they are.

So they're taking advantage of the fact that bigger companies aren't as nimble as a smaller company could be.

And he's really expanding.

They're buying up a new company every few months and he shows himself in this process to be a pretty ruthless and shrewd negotiator.

One fellow industrialist actually said of Jim Ratcliffe, his negotiating tactics are not loved by everyone and people don't like it when pain is inflicted.

But you can be positive about his ruthlessness and his perseverance.

They have resulted in a positive and economic effect in that he's picked up unloved assets and kept them going.

So

quite a charitable assessment of what he's doing, really.

Yeah, I've got a feeling that is very much in hindsight, the advent valuation.

That's from one boss to another.

Yeah.

So by 1994, so two years later, they float on the London stock market and it gets a value of £164 million.

So InSpec can pay off their venture capitalist investors and ease the restrictions on their management.

And all this nets Ratcliffe a personal profit of £28 million.

So he is now safely a millionaire.

So how does Jim Ratcliffe go from millionaire to billionaire?

It all starts with a BP plant in Antwerp, Belgium.

So Inspec purchases this plant for £84 million in 1995 and soon they're tripling output.

But by 1998, the recession begins having an impact.

Specialty chemical values are fluctuating, InSpec share prices falling, analysts are advising them to sell the plant.

So the pressure's building, but Ratcliffe is holding strong.

He is pretty confident he knows the true long-term value of this plant in Antwerp and that the analysts and the markets are wrong.

So like very many of our billionaires, he is bad at taking advice, but it ends up working out for him.

Yeah, it reminds me a little bit of Warren Buffett here.

Because he's an expert in this area, he knows better than the markets who are hot and cold on the value of this company.

He knows what it's really worth.

So he makes a first of a number of big gambles here.

He quits InSpec in order to stage a management buyout of the Belgian operation.

This is quite a big deal, right?

Because you're the CEO and you're walking away to just deal with one plant.

And he needs £90 million to buy it.

And he funds the purchase with something called high-yield bonds.

Okay, you have to explain this because I do not get this at all.

Okay, so high-yield bonds, also known sometimes as junk bonds, are basically IOUs that you issue with a high

repayment rate, a high interest rate, where a lot of people know this is a risky venture.

So rather than lending you money at 5%,

I will lend you money at 10%, 12%, 15%,

knowing that there's a chance that you won't be able to pay me back.

So I am asking for a big reward for lending you the money because I know that there is a big risk.

So he goes out there and raises this money in the junk bond, high-yield market, knowing that a lot of people doubt that he'll be able to to pull this off and that's why he's having to pay so much money for it.

Right.

So it is a big gamble.

And this is when he founds Inos and he installs himself as chairman and chief executive.

And he does all of this without any of the usual coterie of bankers, financial advisors.

And he plans to keep the business private because if you keep the business private, you're not subject to the same financial reporting requirements.

You haven't got shareholders giving you a hard time all the time.

You don't have to do quarterly earnings.

You can focus on the long-term prospects of the business better right you can keep your cards and your ilus close to your chest correct and he's soon joined by two more northern grammar school boys andrew currie joins from inspec in 1999 and john rees comes on board in 2000 and ratcliffe owns a 60 share curry and reese 20 each so at this point i think it's worth talking about what IOS actually does.

Ineos's core business is petrochemicals.

Yeah, they convert raw materials from oil and gas into products that we use every day.

So things like the byproducts of oil refining are things like plastic, man-made fibers, glue, fertilizers, detergents.

There's a whole chemical business that comes up around the oil business.

And petrol chemicals is a big part of oil.

It accounts for 16% of oil demand, which is second only to road vehicles.

And just like he did with InSpec, Ratcliffe is constantly expanding in EOS by buying other companies.

He's a shopper.

Yeah, but he's doing what we discussed, Bernard Arno.

at LVMH did.

It was like a federation of smaller companies and the subsidiaries were run kind of like their own entities entrepreneurial they had their own boards they had their own chief executives all of whom reported in to ratcliffe curry and rees but there's no centralized it or hr department there's no groupthink within the group yeah everything's kind of competing against each other for not just prestige but also financial incentives and in fact he's in a way copying the setup he learned at courthold where he was given autonomy over his own division but he then adds financial incentives Every time Inios acquired a new business, 10% of the ownership or the stake of that company will be offered to sell for the employees of that company.

So they've got some skin in the game.

So these shares aren't shares in the overall group, but in the businesses where those employees work.

So in a way, you're kind of an owner of the places that you work for.

Exactly.

And that's kind of rare.

Usually, if you work for a subdivision of a big company, you're compensated with shares in the wider group.

And that's great.

If your division isn't doing very well,

you're liking it.

But if you're doing great and everyone else's performance sucks, then you're kind of subsidizing them.

So you have real 100% visibility and ownership of your own efforts.

Right.

So this has the effect of encouraging hard work, entrepreneurialism across the board.

And it's just worth putting Ineos in context at that particular time.

Back in the 1920s, you had the petrochemical sector been dominated by huge European and American companies, people like BP, Shell, Dow Chemical, ICI, Bayer, those household names.

But by the early 90s, which is where INEOS comes about, they're facing lower-cost competition from Asia and the Middle East.

So these big names were kind of focusing on their core holdings and they were selling off bits and pieces of their businesses that they couldn't be bothered with.

Now, for someone of my vintage, the name ICI,

Imperial Chemicals Industries, I think that's what it used to stand for, was probably the most famous industrial company in the UK for decades.

Pretty much sold off everything.

It sold the pharmaceuticals on, which, by the way, became AstraZeneca, the one people who developed the COVID vaccine.

Duelux Paints, that was sold off in 2008.

And ICI as a name pretty much became defunct.

This conglomerate that any person in Britain, if you stopped in the street, name a big company, they would have said ICI no longer exists.

Wow, it just goes to show it's like easy come, easy going business, right?

Well, certainly those old-fashioned conglomerates were beginning to crumble into more specialized companies.

and Ratcliffe was right at the heart of that.

So, Ineos was busy during this fire sale period.

It was making acquisitions, it was picking up a stream of all these unwanted assets and companies from these blue-chip companies.

Yeah, Ratcliffe bought ICI cast-offs like the acrylic division of that.

That made Perspex, something that everyone knows.

And he funded that £505 million deal using, once again, high-yield debt and an 80% private equity investment.

And in its first 10 years, Ineos made more than 20 acquisitions from the likes of the ICIs and BPs of this world.

So they're snapping up all these unloved bits of these big companies.

You can just imagine Jim Ratcliffe going around with a shopping trolley, just kind of like, I'll have that one, I'll have that one, I'll have that.

And yet managing to finance it, sometimes using high-yield debt, which is a gamble.

So he's, you know, he's, he is a gambler.

Do you think

analysts at this point would have been like, you're buying way too much stuff.

You just need to focus on what you currently have.

Well, put it this way.

If he was working for a public limited company, which had shareholders and a normal board, he would have had to take every single one of these deals to that and get it through what might have been a sceptical board at times.

But he's acting at pace, which you could probably only do if you're a private company.

Right.

So the structure of Inios itself is amenable towards these shopping sprees.

Yeah, he's in charge.

If he's in a negotiation, he can just shake on it right then and there.

And so he's much more nimble and he trusts his own judgment more than market valuations about what these things are worth.

So that's quite a powerful powerful combination.

So, when we come to this point in the story, Jim Ratcliffe has bought a lot of stuff, but he wants a really, really big deal.

In 2005, he tried and failed to buy a plastics business from Shell for over two billion dollars.

But there is an even bigger deal on the table, and it's actually one that looks too massive for Ineos.

Yeah, this is a David and Goliath thing.

In EOS has an annual turnover of £7 billion.

The company that he wants to buy, Innerveen, which was owned by BP, had a turnover of £22 billion.

So a consultant later likened it to that.

This is the guppy swallowing the whale.

So the company is one of BP's chemical businesses.

So Radcliffe, with his background in chemicals, thinks it's absolutely right for Ineos to take.

And after months and months of talks, Ineos audaciously convinces BP to sell it rather than list it on the stock market and agree to give him a price of $8.7 billion or just under £5 billion pounds.

So he's got 10 weeks to find 5 billion quid.

That's so stressful.

That's two and a half months.

At this point, Barclays, the bank, offers something pretty unprecedented.

This is an unsecured loan for the entire amount for one month.

What does an unsecured loan mean?

Well, it means that so if I a secured loan means that basically it's secured against an asset.

I'll lend your company a billion pounds, but

I have a claim on the assets of your company.

If you can't pay me back, I can take possession of it and I can sell it off.

Right, bailiff style.

Exactly.

So it's secured against the assets of the company.

So, I mean, I would like to know a little bit more about this deal, to be honest.

Who at Barclays is saying, we're going to offer this man £5 billion unsecured for one month.

The bank would guarantee the entire purchase price up front, and then Enios would have one month to refinance the business and pay back the money.

That is high stress.

So, if the deal comes off, they have one month to find $5 billion.

£5 billion, pounds sorry now and actually it was more than that because at the last minute bp added two oil refineries to the deal and up the price to nine billion dollars so he said we're now all of a sudden buying two huge refineries and in his words we knew f all about refineries funnily enough ratcliffe was informed of this new deal while riding his mountain bike you can imagine sweaty kind of a bit tired didn't put him off though because he agreed on the spot yeah he was sort of up there answering a phone um doing mountain biking, covered in mud, and they just said it's not 8.7 billion, it's 9 billion now.

Is it yes or is it no?

And he said it was pretty surreal.

But weirdly, he says this, I did not think of it as very high risk.

We knew they were quite good businesses.

He knew the business so well that he felt comfortable taking what looked like a crazy risk.

So the deal went through and Inio suddenly quadrupled in size.

And in January 2006, a team from the company rushes around 16 cities on a bond raising trip and it succeeds in gaining $2 billion in unsecured bonds to cover part of their urgent obligations to pay back this money.

So they managed to sort of have a whip round on this multi-city tour.

A real sign of confidence that they think this guy knows what he's doing because it worked.

Ineos is quadrupled in size and it catapulted Ineos into the front rank of the world chemicals industry.

And they had a party to celebrate.

They held it at Highcler Castle, which is the setting for Downton Abbey for the fans of the show out there.

And Ratcliffe's 60% stake in Ineos made him a paper billionaire the day the deal was signed in 2005.

So in 2006, he's in the Sunday Times rich list, listed as Britain's 45th richest person with a net worth of £1.1 billion.

He's a billionaire.

Suffs, the new musical has made Tony award-winning history on Broadway.

We demand to be home.

Winner, best score, we demand to be seen.

Winner, best book.

We demand to be quality.

It's a theatrical masterpiece that's thrilling, inspiring, dazzlingly entertaining, and unquestionably the most emotionally stirring musical this season.

Suffs, playing the Orpheum Theater, October 22nd through November 9th.

Tickets at BroadwaySF.com

In business, they say you can have better, cheaper, or faster, but you only get to pick two.

What if you could have all three at the same time?

That's exactly what Cohere, Thompson Reuters, and specialized bikes have since they upgraded to the next generation of the cloud.

Oracle Cloud Infrastructure.

OCI is the blazing fast platform for your infrastructure, database, application development, and AI needs, where you can run any workload in a high availability, consistently high performance environment and spend less than you would with other clouds.

How is it faster?

OCI's block storage gives you more operations per second.

Cheaper?

OCI costs up to 50% less for computing, 70% less for storage, and 80% less for networking.

Better?

In test after test, OCI customers report lower latency and higher bandwidth versus other clouds.

This is the cloud built for AI and all your biggest workloads.

Right now, with zero commitment, try OCI for free.

Head to oracle.com/slash strategic.

That's oracle.com/slash strategic.

Coach, the energy out there felt different.

What changed for the team today?

It was the new game day scratchers from the California lottery.

Play is everything.

Those games sent the team's energy through the roof.

Are you saying it was the off-field play that made the difference on the field?

Hey, a little play makes your day, and today it made the game.

That's all for now.

Coach, one more question.

Play the new Los Angeles Chargers, San Francisco 49ers, and Los Angeles Rams Scratchers from the California Lottery.

A little play can make your day.

Please play responsibly.

Must be 18 years or older to purchase, play, or claim.

Hi, my name's Eddie Hearn, and this is No Passion, No Point.

I'm excited to be back with this new series.

As always, I'll be talking to top performers about what drives them, how they gain an edge over competitors, and whether their dedication to constant improvement comes at a cost.

I love golf.

I'll play it until my hands bleed.

I just enjoy going out there playing with no fear.

What makes them feel fulfilled?

It's not the money, it's not the trophies.

It's the friendships and the memories I've got.

And does that change as their career progresses?

Just a girl who grew up playing football and now I'm getting packs like without even seeing the camera, like it's crazy.

From BBC Radio 5 Live.

No passion, no point.

Listen whenever you like on BBC Sounds.

So the big gamble that paid off.

But not everything has been plain sailing since Jim Ratcliffe became a billionaire.

Yeah, in 2008, the financial crisis, like many other companies, it hit Inios hard.

It halved its earnings, so they cut back on spending.

They were actually in breach of one of their loan covenants.

That's a promise you make to the bank to keep X amount of money on hand, and your earnings versus your borrowings are a certain level.

So, Ratcliffe agreed to pay an extra 804 million euros in bank fees to restructure the loan without losing equity.

Can we just rewind so you can explain what restructuring the loan without losing equity means?

So sometimes if you restructure a loan, what you do is you swap some of the money you owe for some equity, an ownership stake in the company.

It's what they call a debt-for-equity swap.

So it'd be like a kind of dragon's den thing.

I'll give you the money, but I want a percentage of the company too.

In this one, he managed to restructure it without losing his ownership stake.

Right.

So he's still got hold of the company.

Got it.

That makes sense.

And he also asked the then Labour government back in 2008 whether he could pay his £350 million VAT bill later, whether he could defer that bill.

So the Labour government actually said no.

And in 2010, Ratcliffe and his Inios management team actually left the UK for Switzerland because it had a much lower corporate tax rate.

Yeah, and he took people with him.

He moved about 60 families to Roll,

already home to several foreign outposts of a few multinationals.

He's quite bitter about this.

He says manufacturing has not been a good experience for Inios in the UK in general terms.

What it boils down to is, has it been profitable?

Is this a place you wish to invest?

No, said Ratcliffe at the time.

But clearly it didn't put him off because in 2016, six years later, Inios moves back to the UK, citing the importance of their British roots, remember that hard-working northern work ethic, and also to explore fracking for shale gas, which he's still keen to do.

Yeah, and fracking became a big issue about eight years ago.

It It was like, should we do it or should we not do it?

For those who are unfamiliar with this, fracking basically is like fracturing shale rock and fracturing rocks in order to release gas that is contained inside it.

It has totally revolutionized the US energy industry who found enormous gas deposits trapped in rocks, in shale rock, in huge places like in Texas, in Canada and elsewhere.

And it has basically made the US totally energy self-sufficient, a massive exporter of energy and actually has changed the geopolitical politics of the whole world.

So Ratcliffe thought that what happened in the US, the UK should do too.

A lot of other people said, well, it's actually quite an invasive process.

It used lots of chemicals.

It can cause minor earthquakes.

And the UK is just too small and too heavily populated to do it in the way that the US does.

And that debate continues.

And around this time, there's also a long-running saga in Scotland, which is coming to a close.

At the end of 2023 it was announced that Grangemouth, Scotland's only oil refinery, was to close.

Yeah INIOS owned that refinery since 2005.

In 2008 it tried to withdraw a final salary pension scheme and the workers staged a 48-hour strike.

It shut down one-third of the North Sea's oil and gas supply which led to panic buying, queues of petrol forecosts across the country.

Eventually Jim Ratcliffe backed down on that.

But then in 2013 Ratcliffe threatened to close the site completely and the unions conceded everything.

Pay freezes, an end to final salary, pensions, the end of full-time union conveners on site, no strikes for three years and they did this all in exchange for a £300 million investment from ENEOS in the site.

Ratcliffe during this period was called Dr.

No by the unions for his negotiating stance and it was reported he'd prepared for this dispute by stockpiling oil to avoid the queues he'd seen back in 2008.

And he said at the time, we are economically rational.

If it's hemorrhaging cash, you've got to do something about it.

You can't live with your head in the sand.

He also added, the concept you are a bad guy because you have a loss-making plant and want to shut it down is flawed thinking, really.

So pretty ruthless stuff.

So it's been a long-running battle, the Grangemouth refinery.

As we sit here today, that plant is scheduled to close possibly in 2025.

And 400 jobs are expected to go.

And the blame, once again, is being put on Ratcliffe.

Radcliffe, on his side, blames the UK government.

And he says, the UK's total lack of an energy policy is completely completely irresponsible.

The rest of the world is encouraging local oil and gas production, incentivising production through sensible taxation.

The UK is doing the opposite.

And his wealth continues to grow.

In 2023, last year, Inios generated £65 billion in revenue, but higher energy costs after the invasion of Ukraine became an issue for the company and lots of other ones too.

But actually, this might end up working out well for Inios because it might lead to more acquisitions.

You know, big companies with investors are spooked by the current financial climate.

And Ratcliffe is actually quite bullish about the whole situation.

He predicts we'll grow by another 50 to 100% in the next five years, given what I can see in the pipeline.

So he's making plans.

Yeah, so still ambitious on a business sense.

Maybe one of the reasons we're talking about him, though, is because he's become a more of a mainstream profile figure because of sports.

He loves cycling, football, physical challenges.

He's been to the North and South Poles.

He's done Iron Man challenges.

He did the,

what's the one they run through the Sahara Desert?

They do that marathon through the desert.

Complete nuts.

Anyway, so for these people.

Very hard to run on sand.

Ate regularly motorcycles across Africa, you know, like these people do.

He did that once despite a broken leg.

I suppose you can ride a motorcycle with a broken leg.

Sounds a bit sounds a bit painful, though.

Yeah, it doesn't sound pleasant.

He's got a very healthy mind, healthy body attitude towards work.

He encourages staff to join him on pre-lunch runs, etc.

But it's really this obsession with sport, which is why you might have heard of the name Jim Ratcliffe if you're not in the petrochemical industry.

Because in 2019, he bought cycling's Team Sky, who'd won six out of the seven previous Tour de Frances.

He probably renamed them the Inneos Grenadiers, and they won again that year, but haven't won since, interestingly.

And he also enjoys spending money investing in athletes.

So he spent big money in sailing.

He supported the Kenyan marathon runner, Elliot Kipchoge.

But the big news came at the end of 2023 when he paid over a billion pounds for 25% of his beloved Manchester United and he negotiated a clause that gave him control of football matters at the club.

So he's basically in charge.

Yeah.

He's certainly the person who will decide which players they go and buy, which manager they use.

That's, you know, for fans, that's all that matters.

He's also pledged to spend £237 million to update the infrastructure at Old Trafford.

Yeah, Gary Neville, former player, now commentator, said that's nowhere near enough to sort out the club's infrastructure.

But the Manchester Mayor, Andy Burnham, said the plans were exciting.

And, you know, Jim Ratcliffe agrees.

He loves it.

At the first game he attended as the part owner, he described the deal as, quote-unquote, the most exciting venture of his life.

So clearly he's still making moves at the age of 71.

And, you know,

I'd have to say, if I had 20 billion quid, I would go and buy my beloved Liverpool football club probably from their American owners right now.

It'd be the last big roll of the dice.

I mean, if you can't own your own favourite sports team, what's the point of being a gazillionaire?

It really reminds me of Bernie Eccleston, who, you know, started out, you know, selling cars and things like that.

Clearly was good at it, but didn't love it, and then really found his groove running Formula One.

Yeah, it's interesting because I was talking to someone who advises Manchester City, who are the strongest team in the UK, and they mocked Ratcliffe for spending over a billion pounds on buying 25% of a club.

They're saying, you're buying 25%, what's the point?

But I think this thing about having control of football matters is kind of what matters to him as a lifelong fan.

So we've come to the part where we judge Jim Ratcliffe.

Is he good, bad, or just another billionaire?

I'm sure if you're a Man You fan, you have strong opinions on this.

First category, wealth.

So he's worth over $20 billion right now.

He's in the world's top hundred richest people, according to Forbes.

And, you know, clearly he loves spending money mainly on sport.

I think a few years ago he was, in the Sunday Times Richards, he was number one in the UK.

I don't think he still is, but he's right at the top of that tree.

So

I'd give him an eight on wealth.

I'd actually give him a seven just on wealth, but for the fact that he could buy a football team, I mean, that pushes him up to eight, I think, for me.

So I agree.

Apparently, I mean, he's got luxury yachts, he's got Switzerland property, he's got a pub.

And yet, a lot of people say that he doesn't actually enjoy the trappings of wealth that much.

He's not a fancy schmancy person.

Certainly, the way he comes across as a plain-speaking Mancunian who likes his sport, he's not a, there's nothing bling about Jim Ratcliffe, that's for sure.

So maybe you're right, maybe a seven is a better score.

Seven each then.

So rags to riches.

He's had an interesting journey.

Yeah.

A sort of good, honest, lower-middle-class upbringing, no real family money to rely on, moved around with his his father's work.

There's no silver spoons in his mouth here.

No, and he's actually put quite a lot of his personal wealth on the line when it comes to making these deals, right?

You know, mortgaging your house at quite a while.

At the age of 40, putting your mortgage up as security for a deal at the age of 40, that's ballsy, I tell you.

And to our knowledge, that was the only house he owned at the time.

Yeah.

I would give him an eight out of ten for this.

Okay, I'm going to give him...

Yeah, I think eight's a good number.

We're in agreement so far.

Villainy.

Well, this is an interesting one, right?

He was knighted in 2018, but there were actually rumors about three years ago in 2021 of him being stripped of the knighthood over a tax avoidance.

Yeah, he moved to Monaco in 2019.

Famously, of course, it doesn't collect personal income tax or capital gains taxes.

And that was used against him in quite a big way back in 2019.

He was a very big backer of Brexit.

And he did two things which people thought smacked of hypocrisy.

One is he's moving to Monaco.

The second is that he tried to start a new automotive company by essentially inventing a replacement for the old Land Rover Defender, because Land Rover said they were going to stop building those old ones.

And he started this company called Grenadier, named after the puppy owns.

And he was going to put this in South Wales.

It was going to be a big industrial vote of confidence in Britain.

But at the last moment, he moved the plant to France.

Again, people said, come on, you're a big Brexit, big UK first, big UK in control, take back control.

You move to Monaco and you move your manufacturing to France.

He's also on villainy.

Some people would say that fracking is not compatible with the UK's goals for reduction of emissions, that it's actually quite a dangerous and

dirty process, which has no place in a highly populated small country like the UK.

So his support of fracking has earned him some enemies in that direction.

And INUS has also actually been called Scotland's largest climate polluter, thanks to the Grangemouth site.

And in 2023, activists and NGOs won a court case to stop the company starting work at Europe's largest chemical plant in Antwerp, describing it as a carbon bomb.

But a few months later, Inios won an appeal and restarted work at the plant.

So he's in a pretty dirty industry, I have to say.

He is in a dirty industry, but that doesn't make him necessarily a villain.

The dirty industries do exist, and

very few people are untouched by some of these industries.

So, I don't think that in itself makes him a villain.

I think when we look for villainy, we look like, has he turned people over?

Has he been ruthless?

Has he been some boardroom shenanigans?

And although he's well known as being a tough negotiator, I don't know many people who say that he's an SHIT.

Even with the tax avoiding that.

I think that's a different thing.

I think, you know, he's not the first rich person to move to Monarchy.

If you walk down there, you'll trip over them, right?

But there was something about that, there's a slight disconnect between his tough working-class Manchester

Industrial Revolution, part of my DNA kind of bloke, and sunning yourself in Monaco without paying tax.

I think that's where people sort of slightly object to that.

So on villainy, I'm going to give him...

I'm going to go straight down the middle and give him a five on that simply because perhaps the tax matters and the moving his car production unit to France when he was a big Brexit supporter and saying UK first.

I would actually tip him over the edge into a six out of ten just because of the fracking stuff.

Okay.

I mean, we could have a whole podcast series about fracking, but

for now, I'm going to give him a six out of 10 because he's such an advocate of it.

Okay, six for you, five for me.

Philanthropy, what do we know about that?

So he set up the Jim Ratcliffe Foundation in 2019 to focus on child poverty,

childhood poverty, children's sports initiative, like the Daily Mao and animal conservation projects.

We've always had this thing about philanthropy versus paying tax, right?

Throughout this, you know, if you're a tax exile you get to cherry-pick the causes you want to support and some would say that is no substitute for paying tax um to elected officials who decide how the money should best be spent rather than you and if you're worried about you know children children sports you know maybe pay tax rather than do what the jim ratcliffe foundation does which is to set up running initiatives yeah and there was also a controversy in 2023.

The charity regulator was investigating Ratcliffe's charity because it found it paid £16 million for a new skiing clubhouse at an exclusive French Alps club where he skied for years with his daughter.

Very convenient.

But it was later shown that the charity was also subsidizing membership for underprivileged children to learn to ski.

Probably not the biggest problem with the education system, but you know, props for teaching children in the Alps how to ski.

Yeah,

alpine skiing to those who deserve it and need it.

So, philanthropy, where would you score him?

I'm going to go under five for sure.

I'm going to give him a three for this.

I mean,

a skiing clubhouse, really.

I don't really think

that's how money should be spent if you're a rich person to help the underprivileged.

I'd give him a three as well.

Okay.

Yeah.

Sorry, Jim, we're not very impressed.

So, power.

He's obviously a big figure in the petrochemicals business, a very big figure in Scotland because of his interest at Grangemouth, which is now going to turn in, we think, into a kind of import-export for things like liquid natural gas.

So he's got some powerful interests, but I don't think he's the kind of person who wields power.

And I mean, he's no Murdoch, you know, he's no Bill Gates kind of figure.

You know, he's now very much a kind of football club owner, tax exile, etc.

I'd give him a three on power.

Yeah, I mean, I would give him, I'd be slightly more generous.

I'd probably give him a four out of ten.

Okay.

Because he makes big moves in sport, really.

Yeah.

And when you think about how many people are interested in all the different areas of sport that he's interested in, like football alone, that's quite a lot of power to have.

I feel like it will only increase in the years to come, depending on what he does with Manyu.

Yeah.

Okay.

So four for you, three for me, which leaves us with Legacy, which arguably is still evolving.

Well, yeah.

I mean, this is really...

This is really going to come down to what he does as a football club owner, I think.

Because right now for Legacy, I'd give him maybe like a two out of of ten.

Yeah, I agree.

I agree.

But if he turns Man Yu around, yeah.

I mean, the thing is, legacy, when we've talked about people who left a long legacy, the people like Bill Gates, you know, you walk into any office, you still see windows will come up on your thing.

You know,

the tracks, the footprints of their career are very visible in our lives.

I don't feel the same way about Jim Ratcliffe.

Presumably, at some point, he will take full ownership of Manchester United.

That's kind of what is rumoured, that it's 25% on the way to taking full control and maybe he will install a super duper manager and Manchester United will be back on the top of the heap.

But as a Liverpool sport I'd hate that outcome so I don't care whether he does that.

In fact I really hope he fails.

Really, really hope he fails.

So for legacy you would give him...

hopefully zero.

We're going to get so many complaints from Manchester United fans after this.

I can live with that.

So we've finally come to the

finally come to You haven't scored in for legacy.

I'm going to say one.

I'm going to give him a two out of ten.

Okay.

I have no skin in the game in terms of whether Manchester United does well or not.

Okay, fine.

All right.

So good, bad, or just another billionaire.

Where does Jim Ratcliffe stand?

I think he is a very impressive industrialist.

He has brought real rigor, effort, focus to bear on reviving unloved bits of former big industrial conglomerates and made them work and created jobs, saved jobs, created revenue.

The businesses he work, even if he doesn't pay much tax, the businesses he run do.

So, all that kind of stuff, I think, is a net positive for the UK and for the economy and what have you.

On the negative side of the ledger, he

was very big at talking, you know, talking up Britain and then moving his automotive manufacturing to France and moving his tax status to Monaco.

I think people will find that a little bit much, but he's not the first person to do it.

I think he is just another billionaire.

Yeah, I'm going to say just another billionaire, too, because we haven't had many of those.

We actually haven't, you know, so I feel like Jim Ratcliffe should be pleased with that.

Yeah, you've done well, Jim.

That's a good result.

But if Manchester, if Manu beat Liverpool in the next few years,

we'll revise your opinion.

We're comfortably above them in the table at the moment, so I've got no worries whatsoever.

But yes, I'll be watching that, you know, at the moment with pleasure, but with slight anxiety that you managed to turn things around for them.

Well, Jim Ratcliffe, the ball is in your call.

So who do we have on our next episode?

We have a man he's gone into space, taken hot air balloons across the Atlantic, all sorts of mad cap things, in order to promote one of the most famous brands in the world, Virgin.

It's Sir Richard Branson, who has set up no less than 400 companies in his lifetime.

Tried to sprinkle that branding magic dust over just about any business you can think of.

Thanks for listening to Good Bad Billionaire.

This podcast is produced by Hannah Hufford and Mark Ward.

James Cook is our editor and it's a BBC audio production.

Sucks!

The new musical has made Tony award-winning history on Broadway.

We demand to be hunted!

Winner, best score!

We demand to be seen!

Winner best book!

It's a theatrical masterpiece that's thrilling, inspiring, dazzlingly entertaining, and unquestionably the most emotionally stirring musical this season.

Suffs!

Playing the Orpheum Theater October 22nd through November 9th.

Tickets at BroadwaySF.com.