BUSINESS OPINION:LONG-TIME observers and even longer-suffering shareholders in Waterford Wedgwood would be justified in adopting a jaundiced view of the latest attempt to resurrect the group.

A new "private equity" style of management is the latest panacea on offer for the ills of the luxury goods group which has consumed hundreds of millions of investors' money in a number of ill-starred restructurings in the last decade.

There is talk, once again, of a "new Waterford" and much is being made of the pedigree of the new management team led by former Heinz executive David Sculley and, perhaps more pertinently, his chief financial officer, Anthony Jones. Jones is a former acolyte of the legendary Guy Hands, whose appointment was part of the deal under which Lazard Corporate Partners has invested €50 million in the group.

The fund also has two non-executive nominees to the board, again to try and bring some private equity discipline.

The two have certainly set about their task of trimming the group's €400 million in overheads with gusto. Gone are many of the big company trappings that were no longer justified.

The Dublin office is closed; the fleet of black Mercedes that used to shuttle around the top brass has been sold. The flagship London store is also a thing of the past.

Bigger targets are also in their sights, such as the top-heavy middle management and the divisional structure with its plethora of mini-empires and direct board reports.

The duo have also called a halt to the relentless signing up of big-name designers to promote brands, which was part and parcel of the previous turnaround plan.

The group will now concentrate on more prosaic tasks such as making sure it has the right sort of product at the right price for the right market. Key to this is ensuring that funding is in place to ensure that the right products are in stores ahead of the key selling periods, something the group has fallen down on in the past.

The message being sent by Sculley and Jones is that they have come on board to turn the business around in a two- or three-year timeframe using private equity techniques and discipline. It goes without saying they expect to be remunerated in a private equity style as well.

It is not impossible that they will succeed, as Waterford has some of the characteristics of a private equity situation. For example, Sculley and Jones do not really have to be to concerned about keeping the market happy. With the share price languishing at around one cent, there is really very little they can do to damage it further.

More importantly, they have the support of the O'Reilly and Goulandris families who own over 51 per cent of the group. These appear to have embraced the new rescue plan with much the same enthusiasm they seemed to show for the previous management's belief it could save the company if it could just sign up enough B-list designers to endorse its ballooning product range.

But, as was clear from the company's results earlier this month, there is a big task still ahead. The group reported operating losses of €180.9 million for the year including exceptional items.

Waterford needs to raise another €120 million through a share issue. The O'Reilly camp is expected to take up its entitlement and so are Lazard. Presumably, however, they are not going to commit any more of their investors' money unless they feel that Sculley and Jones are being allowed make sufficient progress in the desired direction.

It is tempting, but probably unfair, to say that this might well explain why the controlling shareholders have embraced the new hard-charging, slash-and-burn private equity restructuring with such enthusiasm. Lazard are probably the company's only realistic source for new financing.

Sir Anthony O'Reilly, of course, is no stranger to private equity, having seen at first hand, and to his considerable financial advantage, its potential at Eircom, where he chaired the Valentia consortium.

But, that said, the sprawling hydra that Waterford has become and which is now undergoing radical surgery is very much O'Reilly's creation.

Those who know him say it reflects his particular style of dealmaking, based very much on his skill at managing personal relationship when it comes to making deals. And indeed they add that he is prepared to see much of this structure dismantled to save the company - even if it is because Lazard has put a gun to his head.

One man who must be watching events at Waterford with more that academic interest is Denis O'Brien.

There are very clear parallels between the dysfunctional structure now being demolished at Waterford and the way in which the management structure of Independent News Media (INM) has evolved under O'Reilly, albeit with significantly different outcomes.

But, O'Brien - who owns 25 per cent of INM and is agitating for all sorts of changes - can reasonably ask why Sir Antony is so defensive of the same culture at INM when he has accepted its weakness at Waterford.

Like the Waterford Wedgwood of old, INM is a far-flung empire and there are numerous board reports with a plethora of divisions. The board - one of O'Brien's main targets - is very large and its independence from O'Reilly has been queried by proxy advisory services.

INM - like Waterford - bears the hallmarks of O'Reilly's very personal style of doing business and which - it must be said - has facilitated some of the group's most successful investments, notably in South Africa and India. It is these successes that are O'Reilly's most credible defence against O'Brien's criticism.

But, by abandoning the same culture at Waterford Wedgwood where it patently has not been a success, Sir Antony has left his flank exposed.