The level of disclosure from Smith & Nephew over its Greek debacle is thin to the point of invisibility. The medical products blue chip is refusing to give any detail about the nature of the dodgy sales practices it has uncovered within Plus, its newly acquired business.

Advisers to the company insist that this is not about covering up flaws in a $900 million acquisition that seems to have gone badly wrong. The silence, they say, is merely to placate S&N lawyers, who want the best possible chance of suing the Swiss vendors for compensation if that proves necessary.

The episode reveals the dangers of buying competitors for cash. Due diligence was done in this case ahead of the acquisition in March 2007, but target companies are of course loath to give up their secrets to their closest rivals before a contract is irrevocably signed. So S&N resorted to accepting representations and warranties from the vendors.

Only time will tell whether those warranties are worth the paper they are written on.

There is so much we do not know about this case, it is a wonder the shares slumped only 13 per cent yesterday. The company won't say whether the police have been called in. They won't say what proportion of the acquisition payment is held in escrow and could therefore be clawed back, indeed for most of yesterday they appeared not to know.

Bizarrely, they even refused to name the vendors or even to disclose the name of their own law firm, a large City practice, we are told. The case has all the hallmarks of an overzealous lawyer.

Even if some facts do need to be hushed up for now, there is no excuse for the gobbledegook, ambiguity and obfuscation in the rest of the S&N statement yesterday.

Maddeningly, the company cannot even bring itself to admit in plain English that it has lost customers. No, it has merely “experienced reductions in sales relationships”.

There is more confusion and contradiction in the statement. S&N does not expect to recover the lost revenues from the Greek disaster, but insists that this will have no impact on the continuing robust growth of the business. Work that one out if you can.

The sooner shareholders are told in plain English what went wrong and the likely bill for it all, the sooner they may be ready to move on and forgive. When the dust has settled, David Illingworth, chief executive, must be held fully to account.

patrick.hosking@thetimes.co.uk

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