City: Test at Tiphook

Robert Montague, chairman of Tiphook, the container leasing operation, has always deeply resented his popular image as one of the last of a dying breed of flashy 1980s entrepreneurs - it's not only a cliche, it's wrong, he says. Well, perhaps, but it is hard to resist. In an age of belt-tightening and austerity, Mr Montague still has a yacht, pays himself nearly pounds 1m a year, and his now unprofitable company possesses a jet. He loves shooting and generally gallivanting around. To complete the picture, it now looks to the outside world as if he and his company are about to go down the tubes.

Last week, Tiphook issued its third profits warning of the year and to boot said that it would soon be in breach of its banking covenants. Tiphook may not be bust - Mr Montague assures me it is ridiculous to think of it as such - but it has certainly become the GPA of the container world. Bankers and shareholders will extract a heavy price for the refinancing it so desperately needs.

Management changes already in place or in train will be insufficient to pacify them; at the very least Mr Montague is going to have to split his roles as chairman and chief executive though, pugnacious as ever, he refused to accept this when I spoke to him on Friday evening. To chuck him overboard, however, would be a mistake. WPP's Martin Sorrell managed to survive a refinancing caused largely by his own over-expansion, and shareholders now have reason to be thankful he did; the shares have more than doubled this year. Tiphook is largely Mr Montague's creation; with his wings clipped, he deserves the chance to turn it round.