Octan, Legoland’s largest oil company, today filed for bankruptcy in what is being described as the country’s biggest-ever corporate collapse.
The company had enjoyed a virtual monopoly on the distribution of petrochemical products in Legoland since 1992, when the upstart nudged out market leader Shell.
Experts say that the collapse was to be expected, given the insular nature of the Legoland economy. Said Craig James of Colonial First State, “successive governments in Legoland have failed to implement much-needed structural reforms. The country’s massive overspend on the railway network is a good example of this.”
But though the railway network survives thanks to government largesse, Octan was a publicly-listed company that many investors and banks had assumed was simply too big to fail.
Says James, “Octan was an agressive vertical integrator, locking out competition at every turn. It then spent heavily on lavish corporate sponsorships, and invested heavily in the country’s illogical space programme.”
Both motor sport and the space programme in Legoland are tonight under a cloud, as is the future of Octan’s 3000 workers.
The Economist, a respected London-based journal, claims that the Octan case is instructive for other European nations. It’s editorial ran: “Despite its stated commitment to market reform, Europe remains in thrall to its national champions: enterprises who enjoy fierce loyalty, the absence of competition, and strong state support. Europe’s governments must realise that for customers, shareholders and taxpayers alike, companies such as Octan are a nothing more than a ripoff.”
For Legolanders, now waiting up to four hours for petrol at the country’s handful of Shell service stations, the knowledge that this colossal ripoff had disappeared from the market was surely cold comfort.