What does the cryptic crossword clue "F Observer o (8)" mean?

The definition is "Former PM". The wordplay uses a charade (building blocks). TH (synonym="TH") + ATCHER (synonym="observer") = THATCHER The answer is THATCHER.

F Observer o (8)

Independent Cryptic #11606 | 12 Across | 2023-12-22 flower

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