Given the reception he received from shareholders at this week's annual meeting, First Active's chairman, Mr John Callaghan, must be relieved he had the carrot of a prospective takeover by Anglo Irish Bank to sweeten the pill.

Not that he can be surprised. Any group whose share price sheds nearly 60 per cent of its value in just over a year will face a grilling from shareholders and citing sectoral weakness and the market turning its back on smaller capitalisation stocks in EMU is simply not good enough.

First Active made the classic mistake of thinking that demutualisation and flotation in a bull market guaranteed success. Now it and some of the more gullible former members, now shareholders, have discovered there is no such guarantee. There is a lesson here too for the dot.coms - no amount of hype can replace the need for sound fundamentals and proper strategic planning, elements notably absent at First Active.

Still the word in the market is that it is haggling over the management structure of any merged Anglo Irish/First Active venture. This is delaying the deal's conclusion, implying First Active has yet to truly learn from its mistakes. It should listen to its shareholders. Whatever about the silent rump who handed over proxies, those at the annual meeting were clear about their lack of faith in the talents of the management team.