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LLOYDS hopes it can save tens of mil-

lions of pounds by sending in turn-


around experts to combat the horde
of zombie firms plaguing the econo-
my and bank balance sheets.
But KPMG yesterday warned that
thousands of struggling firms could
starve to death, running out of cash
over the next year if the economy
does not improve, particularly in the
retail and construction sectors.
Zombies are firms that are barely
staying afloat, only surviving thanks
to low interest rates but unable to
pay off their debts.
Lloyds has arranged for 100 small
zombies to get help as part of its tie-
up with the Institute for Turnaround
something usually only within the
financial reach of bigger firms. It
hopes shaking up their business
model will give firms long-term hope
and create a healthy bank customer.
If nothing is done, it would mean
a loss of tens of millions or hundreds
of millions in bad debts, as well the
wider harm of people losing their
jobs, Lloyds Duncan Parkes told City
A.M. So Lloyds will see a benefit of
several millions from this.
The bank has up to 500
more firms it hopes to
save through the same
process.
And Lloyds staff have
an additional incentive
to rescue the businesses
their bonuses are in part
related to the number
of firms turned
around successfully.
destroying value, they have misman-
aged Autonomy, Lynch said, adding
that he had not been informed of the
allegations until HPs statement was
released on Tuesday.
The US companys shock writedown
was largely attributed to Autonomy
allegedly inflating revenue and profit
figures, something which HP had
apparently not noticed when it pored
over Autonomys books before buying
it in October last year. But Lynch
strongly denied that his firm had doc-
tored the figures. He told Channel 4:
I totally reject that allegation.
Autonomy has always been very clear
about its accounting and what we
have done is make sure that we have
always been transparent.
He said that a change in culture at
HP under Whitman, who was drafted
in following the departure of Leo
Apothekar shortly after the deal, was
responsible for Autonomys disap-
Zombies can only
just stay alive
because of very
low interest rates
BUSINESS WITH PERSONALITY
New help for
zombie firms
as debts bite
Autonomy founder Mike Lynch claimed he had been made a scapegoat for HPs failings
MIKE Lynch, the founder of British
software giant Autonomy, yesterday
hit out at the chief executive of
Hewlett-Packard (HP) over claims the
US company had been lied to during
its $11bn (6.9bn) acquisition of
Lynchs firm last year.
The former Autonomy boss, who
was forced out of HP in May, denied
any wrongdoing, rejected claims that
Autonomys figures had been inflat-
ed, and said he had been made a
scapegoat for HPs failures.
His comments, made in a series of
interviews yesterday, painted a vastly
different picture of the reasons for
HPs $8.8bn Tuesday writedown over
the Autonomy acquisition, which had
come alongside a disappointing set of
results and had pushed the US com-
panys shares down to decade lows.
HP boss Meg Whitman had accused
former management at the firm of
serious accounting improprieties
and a willful effort...to inflate the
underlying financial metrics, but
Lynch yesterday rebuffed the allega-
tions and accused Whitman of grab-
bing for straws.
This is a company that has deliv-
ered its worst results in years and Im
not going to be HPs scapegoat for a
company thats in utter disarray,
Lynch told Sky News yesterday.
HP came in with about 300 people,
crawled over everything and found
nothing wrong. And you know why?
Because there was nothing wrong.
The writedown is due to them
pointing performance since the deal,
the exit of many senior staff, and
Tuesdays writedown.
What has happened since [the deal]
is that the business has been very
badly mismanaged, much of the tal-
ent has left and that has led to the
business being written down. They
have got to open up to the fact that
they, in a year, destroyed value which
was created over 10 years, he said.
Lynch, who founded Autonomy in
1996, took it public in 2000, and pock-
eted 500m from its sale, said he
would consider his options regarding
a formal response as soon as we get
some detail.
His comments came as his firms
former auditor Deloitte moved to dis-
tance itself from the situation.
Deloitte categorically denies that it
had any knowledge of any accounting
improprieties or misrepresentations
in Autonomys financial statements.
We conducted our audit work in full
compliance with regulation and pro-
fessional standards, it said.
Whitman had said on Tuesday that
HP had scrutinised the accounts
audited by Deloitte when conducting
due diligence on the deal. Deloitte is
not exactly Brand X accounting
firm. It would be a little challenging
to go in and assume: Hey weve got to
double-check Deloitte, she had said.
It also emerged yesterday that the
matter was being investigated by the
Federal Bureau of Investigation, which
is working with the US Securities and
Exchange Commission.
HP did not comment yesterday.
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ISSUE 1,766 THURSDAY 22 NOVEMBER 2012
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Glencore set to win EU
approval on Xstrata deal
THE 56bn mega-merger between
commodity giants Glencore and
Xstrata looks set to clear another
hurdle today, as EU antitrust regula-
tors are expected to approve the
deal.
Glencore is understood to have
improved its offer to secure an
approval from European
Commission antitrust regulators,
which is set to be officially
announced today.
The commodity trading power-
house has agreed to terminate its
sales deal with global zinc producer
Nyrstar, it is thought, which is
expected to be enough to satisfy EU
competition chiefs and avoid a
lengthier phase two investigation
that could delay completion of the
deal by up to six months.
It is understood Glencore avoided
more substantial concessions,
which could have included the sale
of assets like Xstratas Nordenham
zinc plant in Germany which pro-
duced 148,000 tonnes of zinc last
year or, as some analysts had
feared, the miners San Juan de
Nieva refinery, the largest of its
kind in the world.
After 10 fraught months of negoti-
ations, commodity powerhouses
Glencore and Xstrata finally
brought their tie-up to fruition ear-
Man Group gains from prototype
Man Group, the worlds second largest
hedge fund manager, has shifted $1.5bn
(940m) of its flagship computerised
fund AHL into an experimental new
portfolio to boost ailing returns. The new
vehicle, which Man has internally dubbed
evolution, has made 18 per cent so far
this year, and made 16 per cent last year,
according to a person familiar with its
performance. It has been developed by
Man to help AHL, which manages $16.3bn,
overcome the impact of quantitative
easing and the Eurozone crisis
FT Deutschland faces closure
Gruner + Jahr is poised to announce the
imminent closure of Financial Times
Deutschland, the German business
newspaper. While a decision is expected
on Friday, staff at the paper are certain
that closure is on the cards after 12 years.
China causes row with passports
Beijing has included its South China Sea
territorial claims on maps printed inside
new Chinese passports, infuriating at least
one of its neighbours. Vietnam has made
a formal complaint to Beijing about the
new passports.
Bank drawn into Barclays hotel fight
The property tycoon fighting the Barclay
brothers for control of Maybourne Hotel
Group has written to the chairman of
Barclays Bank to take issue with its
financing of the business.
Archbishop told to seek help
Justin Welby, the next Archbishop of
Canterbury, is under pressure to hire
professional mediators to help to bridge
the schism in the Church of England. He is
likely to seek outside help.
MPS: HMRC disappointing on swaps
The taxman has been accused by MPs of
pushing businesses that were mis-sold
interest rate swaps into administration
despite knowing the financial problems
faced by the firms.
Mikhail Khodorkovsky attacks BP
Imprisoned Russian oligarch Mikhail
Khodorkovsky has suggested BP chief
executive Bob Dudley takes a flexible
view of issues of corruption and human
rights in Russia.
GM secures deal with Ally Financial
General Motors clinched a $4.2bn
(2.6bn) deal to purchase bank holding
firm Ally Financials European, Latin
American and China operations, doubling
the size of the auto maker's lending arm.
News Corp eyes book publisher
News Corp, owner of HarperCollins
Publishers, has expressed interest to CBS
about acquiring its Simon & Schuster
book business, according to people
familiar with the talks.
ISRAEL and the Islamist Hamas
movement agreed yesterday to a
ceasefire to halt an eight-day
conflict around the Gaza Strip
that has killed more than 140
Palestinians and five Israelis.
Announcing the ceasefire in
Cairo, Egyptian foreign minister
Mohamed Kamel Amr said it
would come into force at 9pm
(7pm GMT), which would give 1.7m
Palestinians respite from days of
ferocious air strikes and halt
rocket attacks from Gaza that for
the first time reached Tel Aviv and
Jerusalem.
A flurry of explosions shook
Gaza as the truce deadline
approached and several rockets
landed in the southern Israeli city
of Beersheba. Amr said mediation
had resulted in understandings to
cease fire, restore calm and halt
the bloodshed.
US secretary of state Hillary
Clinton, standing alongside him,
thanked Egypt's new Islamist
President Mohamed Mursi for his
peace efforts, saying his
government was assuming
responsibility and leadership in
the region. Israeli Prime Minister
Benjamin Netanyahu told Barack
Obama he was ready to give the
ceasefire a chance, but that more
forceful action might be needed
if it failed.
Hamas agrees
ceasefire with
Israel over Gaza
Glencore chief Ivan Glasenberg will head the new group after a six month interim period
2
NEWS
BY HARRY BANKS
BY CATHY ADAMS
To contact the newsdesk email news@cityam.com
I
f you are a glass half full type of
person, the news that the UKs tax
system is now the 16th best in
the world, rather the 18th, might
be something to rejoice about. I
prefer to despair about the complex
and arbitrary nature of our tax code,
about the fact that we were 11th as
recently as in 2006, and that a
medium sized UK business has to
make eight tax payments a year and
spend 110 hours on tax compliance,
according to excellent research from
professional services giant
PricewaterhouseCoopers.
Its Paying Taxes 2013 league table
takes account of the total tax cost, the
number of payments that need to be
made and the time required to com-
ply, as proxies for compliance costs.
The total tax component of this meas-
ures all taxes and contributions that
medium-sized firms are forced to pay.
EDITORS
LETTER
ALLISTER HEATH
Our bureaucratic tax system is destroying jobs and growth
THURSDAY 22 NOVEMBER 2012
These include corporation tax, social
contributions and labour taxes col-
lected by the employer, property
taxes, property transfer taxes, divi-
dend tax, capital gains tax, financial
transactions tax, waste collection
taxes, vehicle and road taxes, and
other small taxes or fees.
The United Arab Emirates (of which
Dubai is a flagship component)
topped the league table, followed by
Qatar, Saudi Arabia, Hong Kong,
Singapore, Ireland, Bahrain and
Canada. There is no real reason why
the UK couldnt have a tax system
that is as good for medium sized
firms as either Ireland or Canada, so
our ranking is shamefully poor. This
is costing jobs and growth. But while
the UK is hardly the easiest country in
the world in which to comply with
the tax system compliance takes
just 12 hours a year in the United
Arab Emirates at least it is very far
from being the worst either: it takes
an astonishing 2,600 hours in Brazil.
Andrew Sentance, PwCs excellent
economic adviser, used regression
analysis to look at the relationship
between the level and complexity of
taxes between 2004 and 2011 and
average economic growth rate and
the growth of the stock of inward
investment.
His findings were striking. Each ten
percentage point cut in the total tax
more than it can afford. The budget
deficit is going up, not down: borrow-
ing in the fiscal year to date is 5bn
above last years total, reaching
73.3bn. Central government current
expenditure (which excludes capex)
was 364.5bn, up 2.3 per cent (and
down only very slightly in real terms).
But central government tax receipts
were up by less: only 0.4 per cent high-
er so far. Receipts from income and
capital gains tax are up exactly zero
per cent. Corporation tax receipts are
down 9 per cent. Taxes on interest
and dividends are down. The only
good news is that national insur-
ance contributions are up 4.6 per cent
other than that, disastrous figures
for a government supposedly commit-
ted to fiscal conservatism.
rate (relative to business profits) is
associated with an increase in the
annual economic growth rate of
almost 0.1 per cent a year. Each 10 per
cent cut in the total tax rate is associ-
ated with an increase in the stock of
inward investment by 0.7 per cent per
year. Another key drag on growth is
the administrative burden of the tax
system, reflected in the number of
tax payments businesses need to
make. Complex tax systems also
reduce economic growth. Even if the
chancellor cant or wont cut taxes, he
needs to drastically simplify the tax
system. The research is clear: high
taxes and a high cost of collecting
taxes are both bad for growth. The UK
desperately needs tax reform.
BUDGET WOES
It is not just the tax system that needs
fixing: the UK is still spending far
lier this week, as Xstrata investors
backed the deal. It paves the way for
the largest M&A deal this year.
However, controversial manage-
ment incentive arrangements for
around 70 Xstrata executives and
managers were rejected, which
claimed the scalp of incumbent
Xstrata chairman Sir John Bond who
announced he was to stand down
from his role.
Following regulatory clearance
from Europe, Glencore still needs
approval from Chinas Ministry of
Commerce and a final approval from
competition authorities in South
Africa before the deal is officially
green-lit.
Depending on the combined
groups final weighting, the new
Glencore Xstrata could be the 13th
largest company on the FTSE 100,
which would represent more than
two per cent of the blue chip index.
Glencore declined to comment yes-
terday.
The commodities trading giant
closed up 0.71 per cent at 334.1p yes-
terday, while Xstrata closed up 1.05
per cent at 997p.
The new jobs website for London professionals
CITYAMCAREERS.com
WHAT THE OTHER PAPERS SAY THIS MORNING
IN BRIEF
Santander seeks US car loan IPO
nSantander is reportedly seeking to
float its US car-financing unit just
months after its successful Mexican
IPO. The bank will seek a valuation of
as much as $6bn (3.8bn) people
familiar with the matter said,
according to the Wall Street Journal.
The US car-financing unit, based in
Texas, has a loan portfolio of around
$18bn. The business has recovered
well in recent years, in tandem with
the rest of the US car industry.
Madoff victims appeal ruling
nA lawyer for the trustee seeking
money for Bernard Madoffs victims
asked an appeals court yesterday to
restore $30bn in claims against
JPMorgan Chase and other banks, in a
bid to overturn earlier court rulings that
only Madoff victims, not the trustee,
could sue third parties such as banks
for damages. The trustee has said
JPMorgan and other banks ignored
warning signs about Madoffs fund
allegations the banks have denied.
Morrisons wants new trading laws
nMorrisons, Britains fourth-biggest
supermarket chain, yesterday joined
Asda in lobbying government for
Sunday trading laws to be relaxed on
23 December this year, arguing that
the second day before Christmas is
usually the busiest shopping day of
the year. With the 23rd falling on a
Sunday retailers are restricted by law
to opening for a maximum of six
hours. Morrisons wants an extension
of two to three hours.
DAVID Cameron yesterday pledged to
veto any new European Union
budget that would cut Britains
annual rebate ahead of todays EU
summit aimed at agreeing a seven-
year budget for the bloc from 2014.
The Prime Ministers promise
came as it emerged that even if the
overall budget is cut, the UK could
still pay more if its annual rebate
which adjusts for discrepancies in
farm subsidies between the UK and
France is reduced. The talks come
as EU leaders yet again failed to agree
the terms under which Greece would
receive its latest tranche of bailout
cash. Eurozone finance ministers
said they would meet again next
week in a bid to thrash out
repayment conditions, after twelve
hours of talks failed to secure an
agreement. Without the 31.5bn
(25.4bn) needed to recapitalise
Greeces banks, the country will run
out of money by mid-December. Its
not only the future of our country,
but the stability of the entire
eurozone [at stake], Greek Prime
Minister Antonis Samaras said.
EU budget talks
loom as Greek
deal delayed
BY KATIE HOPE
THE UKS tax system ranked just
16th in the world in 2012, accord-
ing to a league table out this morn-
ing, even after climbing the table
for the first time in seven years.
The UK placed only just above
Kazakhstan, and well
below Mauritius
and Oman in
PwCs measure of
the burden of tax
on medium-sized
firms, even after
rising two places.
And the country
remained five
places lower ranked
than in 2006.
A high
tax bur-
UK languishes
down at 16th in
PwC tax league
BY BEN SOUTHWOOD
den can tightly constrict the supply
side of the economy, PwC econo-
mist Andrew Sentance said in the
report, hence slowing down a coun-
trys growth particularly impor-
tant when the world is struggling
to recover from a deep slump.
The United Arab Emirates was
ranked best in the world, taking
into account the time taken to pay
taxes, the overall tax rate, and the
number of payments medium-sized
firms were required to make.
Qatar, Saudi Arabia, Hong Kong,
and Singapore rounded out the top
five and Ireland, Bahrain, Canada,
Kiribati and Oman took the rest of
the top ten places.
PUBLIC SECTOR net borrowing
soared between October 2011
and the same month this year,
official data revealed yesterday,
prompting some analysts to
predict that the government
would miss its borrowing
targets for the year as a whole.
The public sector borrowed
8.6bn in October, according to
data from the Office for
National Statistics (ONS), up
45.8 per cent on the same
month last year.
This rise pushed the overall
BY BEN SOUTHWOOD public sector net borrowing
requirement excluding the
Royal Mail pension plan
transfer to 73.3bn for the tax
year so far. This is some 5bn
or 7.3 per cent up on last
years total borrowing between
April and October.
HM Treasury played down the
bump in the deficit, claiming
the government was still in line
with its plan to rein in
spending. But Chris Williamson
at Markit said that
extrapolating the 7.4 per cent
increase for the whole of the
year would see the government
borrow around 135bn over the
full financial year, well above its
120bn projection.
He predicted that the Office
for Budget Responsibility would
hike its public finance
projections to at least 130bn
for 2012-13, which combined
with worse-than-expected
economic growth could see a
longer fight to reduce the UKs
structural deficit. Williamson
said the widening shortfall
would add to pressure on
chancellor George Osborne to
hike taxes or cut spending in
the Autumn Statement.
ENVIRONMENTAL regulations
increased energy prices, thereby
driving up the October inflation
figure, the Bank of Englands
minutes revealed yesterday, as
Bank rate-setters voted 8-1
against more quantitative easing
(QE).
The utility suppliers, as well
as Ofgem, pointed to increases
in network and distribution
charges and the costs of
complying with environmental
legislation as a cause of the
[energy] price increases, the
minutes read, citing these rises
as one of the major reasons for
higher inflation.
In turn the Banks monetary
policy committee (MPC), which
sets rates and QE policy, gave
higher inflation as one of the
Bank says green regulations
are driving up energy prices
BY BEN SOUTHWOOD main reasons as all but David
Miles voted against expanding
the asset purchase scheme.
MPC members also cited
better-than-expected GDP
figures, rising exports,
improvements in the US and
China, successful Eurozone debt
sales and an improving credit
climate in the UK as influential
in making their decision, the
minutes showed.
But the Banks agents
summary of business conditions,
also released yesterday,
suggested the economy was still
very fragile.
The committee also voted on
further lowering the Banks base
rate, again rejecting the
proposal unanimously after
reconsidering the motion and
concluding it could hit balance
sheets.
TOP 20 TAX REGIMES
UK EDGES UP GLOBAL TAX LEAGUE
United Arab Emirates
Quatar
Saudi Arabia
Hong kong, China
Singapore
1
2
3
4
5
Ireland
Bahrain
Canada
Kiribati
Oman
6
7
8
9
10
Kuwait
Mauritius
Denmark
Luxembourg
Malaysia
11
12
13
14
15
UK
Kazakhstan
Switzerland
Norway
Seychelles
16
17
18
19
20
United
Arab Emirates
Singapore
Kuwait
Kiribati
Switzerland
Malaysia
Canada
Denmark
Kazakhstan
Norway
UK
Luxembourg
Quatar
Saudi Arabia
Hong kong,
China
Oman
Mauritius
Ireland
Seychelles
Bahrain
THURSDAY 22 NOVEMBER 2012
3
NEWS
cityam.com
J
A
E
G
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R
.C
O
.U
K
OVERCOAT 399
Government may miss deficit
target as borrowing rockets
David Miles is known as the uber-dove
on the monetary policy committee
Andrew Sentance
said high tax
constricts recovery
STANDARD Life yesterday
announced it was cutting 139 jobs
as the company moves away from
selling life insurance as part of a
restructuring plan.
The majority of the cuts will hit the
firms Edinburgh office in its IT,
marketing and investment
divisions, Standard Life said.
It blamed the move on
forthcoming regulatory changes
such as the retail distribution
review and auto-enrolment into
pension schemes, and said the
restructuring would lead to more
streamlined and flexible working.
Our current model and
structure has to change to meet the
changing demands of this new
world where customers will want to
interact in different ways for
different products, Paul Matthews,
the firms chief executive for UK
and Europe, said.
The UKs fifth-biggest insurer
reported a seven per cent drop in
sales last month, with business
from corporate pension schemes
dropping by a third.
The firms chief executive David
Nish also revived talk of a plan to
list its Indian joint venture HDFC
Life, an idea it had floated as early
as 2009. I think we have a very
valuable business there, Nish told
the FT, although he declined to give
a timeframe for the listing.
Standard Life
cuts 139 jobs in
restructuring
BY JAMES TITCOMB
BIG banks should not be broken up,
as it would damage British society,
chancellor George Osborne told an
influential parliamentary commis-
sion yesterday.
He also argued that he was right to
adjust Vickers recommendations to
exempt small banks from some regu-
lations in an effort to stop the rules
hurting competition in the sector.
Osborne criticised the
Parliamentary Commission on
Banking Standards (PCBS) for asking
questions about the structural
reforms of the banking sector, argu-
ing that he has worked long and
hard on the reforms and does not
want to see them undone at this
stage.
Be aware of the consequences of
this. You would be unpicking the
consensus that has built up over the
last two years, and unpicking the
work of Sir John Vickers and the
Independent Commission on
Banking (ICB), Osborne warned the
PCBS.
This work has been accepted by all
Osborne rejects
calls for banks
to be broken up
BY TIM WALLACE
major parties and I am on the verge
of getting on with this.
But Commission chairman Andrew
Tyrie hit back at the pressure the
chancellor tried to exert over the MPs
and peers: Just because something
has achieved a consensus does not
mean it is right.
And other MPs hit out at Osborne
for establishing the committee with
the job of going over banking
reforms, only to disagree with its
attempts in doing exactly that.
The commission also criticised the
chancellor for asking them to scruti-
nise the bank reform plans, then fail-
ing to allow them to see the details.
Osborne argued that legislation giv-
ing power to regulators to monitor
banks is more important than the
details, because the details will
change in future as banks adapt to
the rules. But MPs and peers were not
convinced, as they cannot yet see the
rules as they will stand initially.
Osborne also pushed for the PCBS to
introduce a new professional body for
bankers, similar to that for doctors
and teachers enabling members to be
struck off for bad behaviour.
George Osborne told MPs not to question the banking reform going through parliament
n On big banks: We dont have a
huge number of large banks, sadly
[and] if we aggressively broke up all of
our big banks, I am not sure that we
would benefit from it as a society.
n On Vickers: I created the Vickers
Commission to bring together
disparate voices to form consensus.
The answer Vickers came up with, and
the governments response, is the best
approach to issues of structure in the
banking system.
n On too big to fail: Ultimately the
person doing my job, when faced with
the decision on letting a bank go bust
has to have the confidence to say
yes because Vickers has given them
the confidence people can still go to
cashpoints and get their money out. If
that person in the future is not
confident, then we as a parliament will
have failed.
n On regulatory costs: This is a
significant cost to the industry. Yet the
same MPs who want to screw down the
banks also want the banks to lend
more.
n On the ringfence: Certain things
like deposit taking must be in the
ringfence, while others like market
making should be out of it. But on
other issues, like SME credit, Vickers
recommends flexibility, where the
industry may decide. We will just make
sure the fence is high and not
permeable.
WHAT OSBORNE SAID
THURSDAY 22 NOVEMBER 2012
4
NEWS
cityam.com
HOSTESS Brands last night
won permission from a US
bankruptcy judge to begin
shutting down, and
expressed optimism it will
find new homes for many
of its US brands, which
include Twinkies, Drakes
cakes and Wonder Bread.
US Bankruptcy Judge
Robert Drain in New York
authorised current man-
agement, led by restructur-
ing specialist Gregory
Rayburn, to immediately
begin efforts to wind down
the 82-year-old company, a
process expected to take
one year.
It appears clear to me
that the debtors have taken
the right course in seeking
to implement the wind-
down plan as promptly as
possible, Drain said near
the end of a four-hour hear-
ing.
The judge authorised
Hostess to begin the liquida-
tion process one day after
his last-ditch mediation
effort between the Texas-
based company and unions
broke down.
Twinkie maker Hostess
Brands allowed to shut
BY CITY A.M. REPORTER
ARCADIA yesterday posted a 25 per
cent surge in profits as its billionaire
owner Sir Philip Green told retailers
to stop moaning about the economic
downturn and get on with it.
Weve got to trade. I cant keep lis-
tening to all these people making it
up as they go along, Green said yes-
terday at his flagship Topshop store
on Londons Oxford Street.
He said with 45,000 staff and a
500m payroll we have got to make
it work. Just as consumers have had
to tighten their purse strings, so
retailers have to refine their business
models.
Weve got to up our game. If we sit
there and cry and put on my front
window the Bank of England said X,
it isnt going to help me take any
money, he said.
Greens comments were made as
the Arcadia empire, which owns
some of the UKs most recognisable
brands including Topshop, Dorothy
Perkins and BHS, reported a pre-tax
profit before one-off items of
166.9m for the year to 25 August.
Topshop tycoon
says retail must
raise its game
BY KASMIRA JEFFORD But total sales across its 2,500 UK
stores and 615 international outlets
were flat at 2.68bn. Like-for-like
sales fell 3.2 per cent in the UK due to
challenging conditions on the high
street.
Internet sales grew by 22 per cent in
the period compared with the previ-
ous year while its overseas online
business increased by 33 per cent.
Green said the group had invested
79.2m into the business over the
course of the year, taking its total
investment to over 1bn since he
bought the group in October 2002.
Arcadia, which also runs Topman,
Burton, Miss Selfridge, Wallis and
Evans brands, is one of the countrys
biggest private employers. It also has
615 franchised outlets in 39 coun-
tries.
Commenting on future acquisitions
Green said: Theres sort of two or
three things in my head. If they ever
turned up, wed have to look at
them.
He added that Arcadia would want
to have a seat at the table if there
was any major consolidation in the
market place.
Tycoon Sir Philip Green with Kim Kardashian at a collection launch earlier this month
THURSDAY 22 NOVEMBER 2012
6
NEWS
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THEFORUM
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JOIN THE DEBATE PAGES 22-23
A FORMER colleague of jailed
rogue trader Kweku Adoboli, who
worked on the same desk as the
convicted trader when Adoboli
racked up unauthorised losses of
$2.3bn (1.4bn), is to launch a new
business an online betting
service.
John Hughes, 30, was one of four
traders working on the banks
Exchange Traded Funds desk in
the summer of 2011 as Adoboli
exposed the Swiss bank to huge
losses.
Hughes was dismissed by the
bank for gross misconduct in
January 2012, four months after
Adobolis ex-trader colleague
sets up new betting website
BY MICHAEL BOW
Adoboli was charged with two
counts of fraud. Hughes was not
accused of any criminal activity.
Yesterday, Hughes told City A.M.
the site, betsofmates.com, would
launch on 1 December and help
friends bet with each other on
sports events. Hughes gave
evidence at Adobolis ten week
long trial. During evidence, he
admitted he knew about Adobolis
unauthorised trading account.
Sentencing Adoboli to seven
years in prison on Tuesday after he
was found guilty on two counts of
fraud, Justice Keith said: There is
the strong streak of the gambler in
you, borne out by your personal
trading.
INTERNET retailer Amazon has
received more complaints than any
other party over applications for a
new range of web address endings.
The US company has applied to
the Internet Corporation for
Assigned Names and Numbers
(ICANN) for dozens of web suffixes,
such as .app and .book.
But as a list of complaints from a
50-strong panel of countries
published yesterday displayed, 30 of
Amazons applications were
objected to.
Other objections were over spread
betting firm IG Groups user of
.broker and LOreals use of .beauty.
Australia was the biggest
complainant over the domain
endings, with 129 objections. The
Australian authorities argued that
Amazon is proposing to exclude
any other entities, including
potential competitors.
In June, a list of 1,930
applications for the new website
domains was published, revealing
strong demand from the likes of
Amazon and Google.
Each application costs a company
$185,000 (116,000), with no
guarantee they will be picked in
cases of competition for the domain
endings.
The objections are now set to be
reviewed by ICANN, with the first
domains set to go live next year.
Amazon tops
web endings
complaints list
BY JAMES TITCOMB
DAILY MAIL & General Trust (DMGT)
yesterday sold off its regional news-
paper arm to a consortium led by the
former chief executive of the Mirror
Group, David Montgomery, in a deal
that forms a new British media firm.
The firm, called Local World, will
consist of Northcliffes more than 80
papers, with 36 titles from local
newspaper publisher Iliffe also
brought into the group.
DMGT has sold the business for
52.5m in cash and a 38.7 per cent
stake in the new group, with
Northcliffe boss Steve Auckland tak-
ing the chief executive position at
Local World. The Yattendon Group,
which owns Iliffe, will take a 21.3 per
cent stake in the company, while
Daily Mirror owner Trinity Mirror
has paid 14.2m for 20 per cent of
the venture although its own
regional papers will not become part
of the group.
Other shareholders include City
fund manager Crispin Odey and Lord
Ashcrofts Artefact Group.
Montgomery who served as
New media star
is born as DMGT
sells Northcliffe
BY JAMES TITCOMB
Mirror Group chief from 1992 to 1999
and founded the European newspa-
per publisher Mecom will become
chairman of the new company.
I have had a vision for some time
that the regional newspaper industry
needed to change, Montgomery said
yesterday, as he outlined a new vision
for the struggling sector, focusing on
online services. Local publishing is
not going to die, the means of distri-
bution are going to change, he said.
The deal was welcomed by analysts,
despite the fact that it will earn
DMGT far less than the 1.2bn private
equity bid for Northcliffe it reported-
ly turned down in 2005.
Daily Mail and General Trust plc
21 Nov 15Nov 16Nov 19Nov 20Nov
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475
480
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21Nov
THURSDAY 22 NOVEMBER 2012
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A

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B
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a
n
d
DMGT turned to long-standing advisers at
Lazard to work on the sale of its local arm.
UK head of investment banking Nicholas
Shott leads the team.
Shott is no stranger to the industry. He was
involved in the sale of the Telegraph to the
Barclay brothers in 2004, and the
Lebedevs 2009 purchase of the Evening
Standard.
He also wrote a report for then-culture sec-
retary Jeremy Hunt on the local television
market in 2010.
Local World took on boutique merchant
bank Lepe Partners as its adviser. A rela-
tively new rm on the scene, media-
focused Lepe was founded last year by
former LongAcre chief executive Jonathan
Goodwin.
Its advisory board includes media luminar-
ies such as Brent Hoberman, the co-
founder of Lastminute.com and Michael
Jackson, the former C4 chief executive.
Morrison & Foerster gave legal advice to
Local World, with a team fronted by
Edward Lukins, Mary Lappas, Trevor James,
Alistair Maughan and Daniel Leventhal.
MoFo, as the US rm likes to be known, set
up a London ofce in 1980 and has built a
reputation for its expertise in up-and-com-
ing companies.
ADVISERS DMGT SALE TO LOCAL WORLD
WHOS INVOLVED IN LOCAL WORLD
NICHOLAS SHOTT
UK HEAD OF
INVESTMENT BANKING
AT LAZARD
DAVID MONTGOMERY
Montgomery, the former chief
Executive of Mirror Group, will
be chairman at the new com-
pany.
STEVE AUCKLAND
The Northcliffe boss will be
chief executive of Local World,
while Northcliffe owner DMGT
will own 38.7pc of the rm
SIMON FOX
The Trinity Mirror chief execu-
tive will sit on the board, rep-
resenting the companys 20
per cent stake.
CRISPIN ODEY
The prominent City asset man-
ager has invested in the rm,
and is contributing one board
member.
LORD ASHCROFT
Artefact Group, an investment
fund associated with the for-
mer Tory Deputy Chairman, is
a shareholder
EDWARD ILIFFE
Iliffe is chief executive of the
Yattendon Group, owned by
the Iliffe family - who have a
21.3 per cent stake.
EMERALD miner Gemfields is to buy
luxury jeweller Faberg in a deal that
values the iconic egg maker at $142m
(89m), it said yesterday.
Faberg, famous for its jewelled eggs,
is being sold by Pallinghurst, which is
headed by former BHP Billiton execu-
tive Brian Gilbertson, who will retain a
49.3 per cent stake in the combined
group.
With the acquisition, AIM-listed
Gemfields wants to position itself as a
leading coloured gemstone miner and
global iconic luxury brand.
The precious stone miner will issue
up to 214m shares as consideration for
the deal, which will be paid to Faberg
shareholders in proportion to their
holdings in the company.
Gemfields is being co-advised by JP
Miner Gemfields
snaps up luxury
jeweller Faberge
BY CATHY ADAMS
Morgan Cazenove, with Neil Passmore
and Jamie Riddell part of the team from
the bank. Passmore has previously held
roles on the Glencore and Xstrata deal,
as well as with London Mining and
Ophir Energy. Canaccord Genuity is
joint financial adviser, with Tarica
Mpinga and Andrew Chubb leading the
team from the group.
Gemelds Plc
21 Nov 15Nov 16Nov 19Nov 20Nov
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37
38
39
40
41
p
36.50
21Nov
THURSDAY 22 NOVEMBER 2012
9
NEWS
cityam.com
NEW8 FROM THE
CTY OF LONDON
ADVERT8EMENT
News, info and offers at www.cityofIondon.gov.uk/eshot
The Cily of London's Arlizan
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courses and classes lhroughoul
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Christmas cheer in the Cityl
Pick up some Chrislmas bargains al Cheapside, Leadenhall
Markel (piclured), One Nev Change, Palernosler Square and
ov Lane on Salurday 1 December from 10am lo 6pm, vhen lhe
area closes lo lrac and comes alive for feslive shopping and
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Complicile's adaplalion of
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A Chrislmas 'pop-up shop' vill open - for one day only - al Cily
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December from 11am lo 8pm. Slalls vill sell a vide range of gifl
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The Master
and Margarita'
at Barbican
Christmas shop pops up at City libraries
8upport your City
library
A GEM OF A DEAL
MINER GEMFIELDS
BUYS LUXURY
JEWELLER
FABERG
FOR $142m
21 NOVEMBER 2012 16 AUGUST 2012 16 AUGUST 2012
ANGLO AMERICAN
TAKES FULL
CONTROL OF
DE BEERS FOR
$5.2bn
14 NOVEMBER 2012
HARRY WINSTON
BUYS MINER
BHP BILLITONS
DIAMOND
BUSINESS FOR
$5OOm cash
The 76-CARAT
Archduke Joseph
Diamond was sold
in Geneva earlier
this month for
The worlds diamond production
passed its peak in 2005
and today is about
Prices for rough diamonds
on average have declined
Anglo American CEO,
Cynthia Carroll
$21.5m
15%
this year
$$$
$$$
175m carats
per year
making Christmas more comfortable
A
NOT-SO-JOLLY work jolly for
an intrepid pair from City
financial services firm
Merchant Securities, who
jetted off to Central Asia recently.
Chris Theis, head of international
sales and research at
Merchant Securities, and
his mining analyst col-
league Kurt Burge,
recently returned to
British soil (no doubt
kissing the ground at
Heathrow when they
landed) after a work trip
to visit the exploration
and development compa-
ny, Premier Golds,
operations in
Kyrgyzstan.
The jet-setting duo were
staying in Bishkek, at a five star
hotel boasting all the modern facili-
ties a business traveller could hope
for high-speed internet access, satel-
lite TV, safe deposit boxes, air condi-
tioners and mini-bars.
Once happily settled into their hotel
rooms, the pair opened the drawers
beside their beds. Rather than find-
ing a Gideon bible they were
rather surprised to discover a
pair of well-worn gas masks.
Browsing the website of
the hotel in question, The
Capitalist couldnt help but
notice it promises to offer
guests a really unforget-
table accommodation
in Kyrgyzstan.
It would be
fairly safe to
assume that
in this case
that was a
promise well and
truly fulfilled.
11
cityam.com
THURSDAY 22 NOVEMBER 2012
cityam.com/the-capitalist
THECAPITALIST
EDITED BY CALLY SQUIRES
Got A Story? Email
thecapitalist@cityam.com
AN interesting piece of literature
arrived on The Capitalists desk
yesterday morning. A self-
published novel from former
Lloyds broker Victoria Neville.
Thursday Nights, Monday
Mornings promises tales from the
shambolic playground of the
London insurance market.
Delving into the pages to see
protagonists with names such as
Sarah Shagger Smith it appears
to be an apt description.
Neville, who worked as a Lloyds
broker for 21 years, told The
Capitalist: Most of the directors
at my firm have bought a copy and
Ive had loads of underwriters
asking for it.
Apparently the author is most
frequently grilled by colleagues
who knew she was writing the
racy tome over the true identity
of Tony the Philanderer, with
several insurance chaps keen to
claim the title.
The book is available for Kindles
on Amazon priced at 2.09.
Victoria Neville (left) former broker and author of Thursday Nights, Monday Mornings (right)
An unwanted
hotel surprise
in Kyrgyzstan
Fifty Shades of Lloyds - Former
insurance brokers debut novel
EAT. the daily provider of
deskfast for many a busy City
worker, yesterday caused a stir among
loyal patrons by announcing a total
rebranding of its many outlets.
However, dont throw your porridge
out of the pram just yet, speaking
toThe Capitalist at a preview of the
new store on the The Strand, chief
executive Niall MacArthur (pictured
below) revealed lunch classics like the
hot pot will be staying, it is the design
that will change: Our main new
branding colour is an egg yolk
yellow. Not deterred by the vibrant
decor were hungry workers from
Lyceum Capital and Liontrust Asset
Management, and an uninvited guest
in the form of pop singer Will Young,
who were queuing out the door
yesterday morning to get their hot
little hands on the free food.
STRONG bike sales following the sum-
mer of sport failed to make up for the
wet weather at the beginning of the
year, as Halfords yesterday reported
that profits dropped by 23 per cent in
its half year results.
The bicycle to car-parts retailer said it
made pre-tax profits of 42.4m for the
six months to 28 September, while
sales edged up by 0.4 per cent to
455.6m after a tale of two quarters,
one of rain followed by a strong per-
formance boosted by the Wiggins
effect, referencing Olympic cycling
champion Bradley Wiggins.
Halfords chairman Dennis Millard,
said the group was not standing still
and has heavily invested in IT, online,
training and customer service, hiring
Halfords profit
drops despite
high bike sales
BY KASMIRA JEFFORD
450 new staff in the first half.
It wants to expand its share of the
1bn-a-year car maintenance and fit-
ting market and is also looking to up
its share in the 700m market for
cycling parts, accessories, and clothing,
with plans to broaden its range from
750 current lines to 6,000.
JD Sports sprints ahead but its
fashion arm runs out of breath
The image above shows what Londons skyline will look like in two decades when the developments are expected to be completed
Halfords Group plc
21 Nov 15Nov 16Nov 19Nov 20Nov
325
330
335
340
345
350
p
342.20
21Nov
JD SPORTS, the sportswear and
fashion retailer, yesterday posted
a rise in sales despite a steep
drop in trading at its fashion
division.
The retailer said like-for-like
sales in the UK rose 1.5 per cent
in the 16 weeks to 17 November.
But while sales at its sports
stores, which include JD and
Size?, rose by 3.5 per cent,
trading across its fashion stores,
which include Bank and Scotts
slumped by 6.6 per cent on a like-
for-like basis.
JD, which came to the rescue of
outdoor sports chain Blacks
BY KASMIRA JEFFORD
Leisure last year, has started
investing and revamping the
stores and said early signs are
encouraging for the future.
It has recently brought in ex-
Cotswold boss Ken Reeve to run
the Blacks part of the firm, and
yesterday said it would update on
the turnaround after Christmas.
N+1 Singer was upbeat on the
strategy so far, saying: The
perceived risks with the Blacks
turnaround are diminishing and
we have confidence in
managements ability to turn the
business around.
JD Sports added that the
groups full-year performance is
substantially dependent on
Christmas trading, particularly the
last two weeks of December, but it
is on course to deliver full-year
earnings in line with expectations.
Shares in the firm closed up
almost one per cent.
THURSDAY 22 NOVEMBER 2012
12
NEWS
cityam.com
The new
jobs website
for London
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French Connection said the market remains inconsistent.
THE BATTERSEA Power Station and the new US
embassy are just two elements in a huge
regeneration plan set to transform a vast stretch of
the River Thames between Battersea Park and
Lambeth Bridge.
The Nine Elms Opportunity Area, which
straddles the boroughs of Lambeth and
Wandsworth has been coined The New South
Bank and will become home to 16,000 new homes,
creating 25,000 jobs as well as two new London
Underground stations, river services, a brand new
park and a bridge across the Thames.
An image released yesterday by Nine Elms and
designer Miller Hare shows what the skyline is set
to look like once the schemes are completed.
Helen Fisher, Nine Elms programme director,
said: This fast developing stretch of the Thames
riverside includes a cluster of tall buildings at
Vauxhall, centred around western Europes tallest
residential tower, One Nine Elms.
The One Nine Elms scheme being developed by
Green Property and CIT Group will include two
towers of 58 and 43 storeys with residential, office
and retail space. Other projects include Ballymores
Embassy Gardens which will sit next to the US
embassy and St Modwen and Vincis
redevelopment of New Covent Garden Market.
New image reveals
London skyline after
Nine Elms makeover
BY KASMIRA JEFFORD
THE ONSET of Autumn has helped the struggling
fashion retailer French Connection post an uptick in
trading in the third quarter of the year, as shoppers
stocked up on coats and knitwear.
The company, which has issued three profit
warnings within the last 18 months, said like-for-
like sales at its UK and European retail business were
flat in the 16 weeks to 20 November. That compares
to a 9.5 per cent slump in the first half of the year,
when it swung to a 6.3m pre-tax loss.
The retailer recently completed a review of the
business, pledging to focus on improving store
operations, altering its product range and closing
underperforming outlets. The group yesterday said
changes it has made so far have had a positive
impact on the Autumn 2013 ranges.
It said third quarter profit before tax was broadly
in-line with expectations but said its performance
was as ever dependent on Christmas and New Year.
Autumn chill helps
French Connection to
reverse recent decline
BY KASMIRA JEFFORD
13
NEWS
Why is Citi backing our appeal?
Bob Annibale, global director of Citi Microfinance
14
CHRISTMASAPPEAL
CITYA.M.
THURSDAY 22 NOVEMBER 2012
cityam.com
THE CAPITALIST asks Bob Annibale,
Citis global director of
microfinance, why the bank is
supporting the City A.M. Christmas
Appeal this year.
Citi has been supporting
Opportunity International since
1994. The Citi Foundation and
Opportunitys missions were then,
and continue to be, well aligned,
with both organisations supporting
the economic empowerment and
financial inclusion of low- to
moderate-income people.
What makes Opportunitys work
unique?
Two key points for me. Firstly their
model setting up scalable,
financial institutions that will
ultimately be sustainable. For
example they have more than
400,000 savings clients in Malawi
alone. Secondly their approach to
innovation and use of new
technologies is exciting. For instance
using android tablets for gathering
critical data from farmers.
Is it more important for people to
give their time or money?
In an ideal world people would give
of both their time and money, but we
all face different circumstances and
should give what we are able to. It is
important to say that people
sometimes dont recognise the value
of their skills to a charity. The
Olympic volunteers provided a
fantastic example and its great to
know that the Mayor is looking at
ways to keep Londoners volunteering.
Do you think that the rich have a
moral obligation to give to
charity?
None of us is an island. We have a
responsibility to those around us.
Do you think the economic crisis
has affected peoples attitude to
charitable donations?
A report from the Charities Aid
Foundation and the National
Council of Voluntary Organisations
last week showed exactly that. The
report doesnt examine causes for
the reduction in giving, but I think
we can assume recession has played
a part. We have to hope it is a blip
as individual giving is a vital part of
funding, especially when
government is cutting back.
What is your favourite example of
a charity in action?
Im most focused on organisations
that are impacting communities
through provision of financial
services and support for
entrepreneurship. There are some
fantastic examples, including
Opportunity International the
level of sophistication of the
technology it is using is first rate.
Not only bringing electronic
payments to people, but also using
biometric technology to securely
create a financial identity for
clients who may not have identity
documents.
Is there anything you would like
to change about the way
we give?
Unfortunately, the number
of donors in the UK using
payroll giving has dropped
in the last 12 months.
Certainly companies like
Citi must play their part to
increase it.
Text donations may not
work from company
mobile phones as these
often block premium
messages.
If donations exceed our
programme needs in
Africa, they will be
deployed elsewhere.
online at:
www.cityam.com/appeal
70070
TWEET
by text
Opportunity International
(01865 725 304)
credit or debit
card by phone to
#cityamappeal
CITY13 and amount
(5 or 10 only) to
with details of why youve
donated. These comments
may be printed in City A.M.
HOW TO
GIVE
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Matching your
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MID-TIER accountancy group BDOs
ambitions in Asia appear to be paying
off, with the firm posting 14 per cent
annual revenue growth across its
global businesses, propelled by
expansion in the region.
BDO, the sixth-biggest accountant
in the UK and fifth-largest worldwide,
said revenues across all of its member
firms increased 14 per cent to
4.63bn (3.72bn), or six per cent to
$6.015bn in dollar terms, for the year
to the end of September.
The group said fee income in
Asia Pacific soared 48.5 per
cent, not including a
planned tie-up with PKF
in China. BDO remains in
talks to combine its UK
operations with PKF, and
has credited much of its
growth in Australia this year
to a similar merger.
In Europe, revenue
growth was more
subdued at 4.6
BDOs global
ambitions help
revenues soar
BY MARION DAKERS
per cent, with a strong showing in
France and Norway.
The firm operates in 138 countries,
employing almost 55,000 people up
more than 12 per cent on a year ago,
thanks to both merger activity and
organic growth.
Audit and accounting services make
up 61 per cent of BDOs work, though
advisory services took a small slice of
share to represent 21 per cent of the
firms fees this year.
Chief executive Martin van Roekel,
who took the top job in October 2011,
said he was delighted by the firms
progress.
The alignments realised between us
and other mid-tier networks this year
and last effectively demonstrate our
mutual desire to lead, from a posi-
tion of strength, the inevitable and
long-overdue consolidation in our
segment of the accounting profes-
sion, he said in a statement.
BDOs Martin van
Roekel is on the
acquisition trail
15
NEWS
cityam.com
The new jobs website for London professionals
CITYAMCAREERS.com
SIGNIA Wealth, the wealth manage-
ment group, has hired Rupert
Robinson, chief executive of Schroders
UK Private Bank, to be the right
hand man to founder Nathalie
Dauriac-Stoebe, according
to industry sources.
Robinson, whose impend-
ing hire is being viewed as
Signias most senior
appointment to date, will
be based in the groups
London office, where he will
head up the firms wealth
Signia Wealth swoops on rival to
hire right hand man to founder
BY DAVID HELLIER
management activities.
He has been at Schroders for more
than a decade as part of a career that
includes a stint in a senior role at
Rothschild.
Signia Wealth has a number of pow-
erful backers and its Advisory Board
includes the entrepreneur John
Caudwell, the private equity veter-
an Jon Moulton, and Fitness First
founder Michael Balfour.
In just over two years, Signia
Wealth has already amassed over
2bn in assets under management.
Signia declined to comment
about the appointment when
contacted by City A.M.
Rupert Robinson is set to move
INTERMEDIATE Capital Group (ICG)
profits have slumped due to impair-
ments and a lethargic investment
market, but the specialist financier
has still managed to attract 2.3bn
(1.8bn) to its latest fund.
ICG said pre-tax profits for the six
months to the end of September fell
64 per cent to 39.6m, after it booked
impairments of 64.8m in its invest-
ment arm, mostly due to two assets.
The remainder of the portfolio is
broadly resilient but the economic
environment remains volatile, said
chief executive Christophe Evain.
In spite of the moribund market,
ICG has done a handful of deals
including a buyout of food firm
Symingtons, financing the acquisi-
tion of ceramics firm Esmalglass and
the purchase of a loan book from an
unnamed European bank.
ICG deployed 469m in the period,
including 157m for its investment
company.
The pipeline of new business looks
Intermediate
Capital hit by
impairments
BY MARION DAKERS
quite good but given the scale of
impairment we expect to significantly
downgrade our forecasts for this year,
said analysts at Numis, which has a
hold rating on the stock.
The fund management business
fared better, with its new ICG Europe
Fund V beating its 2bn fundraising
target, making it the largest new
European fund of its kind since 2007.
Total assets under management rose
six per cent to 12.1bn during the half-
year. Fee income rose four per cent to
44.8m, including an 11 per cent rise
in fees from third parties to 33.6m.
HOW MUCH CHRISTMAS SHOPPING
WILL YOU DO ONLINE?
Interviews by Alex Croell
Ill probably do about 85 per cent of it online
due to laziness. Compared to last year, I do
think my Christmas online shopping has pro-
gressed substantially. I mainly order vouchers for people
and get my shopping done throughout December.
These views are those of the individuals above andnot necessarily those of their company
CHRISTOPHER
JENNER
SWISS RE

I imagine Ill do about 50 per cent of my


shopping online this year. I normally go to
John Lewis, Next, or Amazon for presents. But
I denitely dont start shopping until December.
PAMELA HARTLEY
STANDARD BANK
I really only do online shopping around
Christmas and its mainly for toys. Its a lot
easier to do price comparisons online so its
convenient. I started early so Im almost done.
DAVID SHOEBRIDGE
CBRE

UKs online retailers prepare for


record breaking Cyber Monday
CHRISTMAS is expected to result
in the biggest day in online
retailers history this year, with
visits to shopping websites due to
top 100m for the first time.
Retailers have flagged Monday 3
December dubbed Cyber
Monday as the most intense day
of Christmas shopping this year.
This is down to a combination of
a majority of consumers seeing
pay packets come in on the Friday
before, and people window
shopping over the weekend.
Research firm Experian is
predicting 115m visits to retail
BY HARRY BANKS
websites on the day, a 36 per cent
increase on the busiest Christmas
day of last year, and 15m hours
spent shopping during the day.
Last years Cyber Monday saw
85m hits to online retail sites, with
28 per cent of those to Amazon and
eBay, according to Experian.
Visa which handles around 1
in every 3 spent in the UK said
yesterday it was expecting a 21 per
cent increase in online spending
on 3 December, with 320m spent
using Visa cards alone. John Lewis
said it expects technology
products such as Apples new
iPad mini to be the biggest-selling
items.
Experians James Murray said
2012 would outstrip last year on
all fronts.
This will be the peak of pre-
Christmas shopping in the UK so
marketers need to make sure their
campaigns are in place to
maximise traffic on Cyber
Monday, he added.
John Lewiss Peter Ruis said that
online shopping now accounts for
a quarter of the retail giants trade.
The company said on Monday
that it had seen online sales rise by
just under a third year-on-year last
week, partially driven by an
increase in shopping on
smartphones and tablets.
UK Mail hopes to pick up clients
in wake of Royal Mail shake-up
FTSE-listed delivery firm UK Mail is
snatching market share from
Royal Mail and other operators, it
said yesterday after posting an 11.9
per cent jump in revenues for the
six months to the end of
September.
Pre-tax profits before
exceptional items rose 7.8 per cent
on a year ago to 7.3m.
The firm offers parcel and mail
delivery primarily for businesses,
and counts O2, Hornby and an
NHS Trust among its clients. UK
Mail hopes to make more inroads
into business-to-consumer
BY MARION DAKERS
deliveries. Mail volumes rose two
per cent on a year ago,
outperforming an overall drop in
letters being sent in the UK.
The firm said a recent hike in
Royal Mail prices has driven
customers towards its services.
Parcel volumes rose 10 per cent
on last year, reflecting a string of
client wins and growing business-
to-consumer deliveries.
Chief executive Guy Buswell said
cost cuts and network
improvements have gone well
during the period. All of this gives
us confidence that we can
outperform our competitors and
gain further market share as our
industry continues to undergo
significant change, he said in a
statement.
UK Mail shares rose 1.5 per cent
yesterday.
CITYVIEWS
Intermediate Capital Group PLC
21 Nov 15Nov 16Nov 19Nov 20Nov
290
292
294
296
284
286
288
p 294.50
21Nov
UK Mail Group plc
21 Nov 15Nov 16Nov 19Nov 20Nov
270
275
280
285
p
281.00
21Nov
PLANS for one of the largest ever
regeneration projects on the
former St Bartholomews Hospital
site in the City have been approved.
Helical Bar, the property
developer run by industry veteran
Mike Slade, yesterday said the City
planning committee has given the
go-ahead to build 215 flats, 230,00
square feet of offices and 27,000
square feet of shops on the 2.3 acre-
site, renamed Barts Square.
The buildings on the site are
Mike Slades giant Barts Square
scheme in the City approved
BY KASMIRA JEFFORD
currently let to the NHS but will
become vacant over the course of
the next two to four years, with
work due to start in 2014, it said.
The group bought the Barts site
last year for 55m with US money
manager Baupost from the Barts
and the London Charity.
Gerald Kaye, Helical development
director, said: We are very excited
to have received the resolution to
grant and believe the outcome of
the committees decision reinforces
the clear need and support for
redevelopment in this area.
THURSDAY 22 NOVEMBER 2012
17
NEWS
cityam.com
The ex-St Bartholomews Hospital site will have 215 flats and 27,000 square feet of shops
IN BRIEF
Minoan snaps up Classic Travel
nScottish travel group Minoan
yesterday said it would buy specialist
travel agency Classic Travel as well as
the Golf Concierge brand. AIM-listed
Minoan said it would pay a maximum
of 600,000 for the Classic Travel
business, dependent on it meeting
targets over the next two years of
trading. Separately, it also bought the
Golf Concierge brand, which generates
revenue from specialist golfing breaks.
Unite Group launches retail bond
nUnite Group, the UKs biggest
student accommodation provider,
yesterday become the latest firm to
launch a retail bond. With 2,000 as
the minimum investment, the bond
pays a coupon rate of 6.125 per cent
and matures on 12 June 2020. The
group aims to raise 50 to 75m from
the bond to fund expansion. Investec
advised Unite on the issuance. Tesco, St
Modwen GSK and National Grid have all
tapped the bond market this year.
Sainsburys adds 10,000 new jobs
nSupermarket chain Sainsburys
yesterday announced it would create
10,000 new jobs in its convenience
business over the next three years.
The new roles, come on top of a
further 20,000 temporary roles
created to serve increased customer
demand over the Christmas period.
Sainsburys plans to open one to two
convenience stores a week going
forward and opened 49 in the first half
of this year.
CAPITAL & Counties (Capco)
yesterday cleared another hurdle
after its 8bn regeneration plans
at Earls Court were approved by
Kensington and Chelsea council.
The Sir Terry Farrell-designed
scheme will see the Earls Court
Exhibition Centre and several
housing estates demolished and
replaced with 7,500 new homes
creating a new London district,
according to the developers.
The masterplan has now won
approval from both Fulham and
Hammersmith as well as
Kensington and Chelsea council.
But the property developers still
have a number of challenges to go,
including ongoing talks with
Capital & Counties moves one
step closer to Earls Court plan
BY KASMIRA JEFFORD
fellow landowner Transport for
London over its lease on parts of
the 77-acre site owned by TfL.
Capco said Section 106 its
community obligations is being
finalised with the local authorities
while London Mayor Boris Johnson
is expected to sign off on the
masterplan in the coming weeks.
Ian Hawksworth, chief executive
of Capco, said: We are delighted
that the Earls Court Masterplan
has now been approved by both
[councils]... The project has real
momentum and we look forward
to working with the local
authorities to deliver Sir Terrys
vision for a new urban quarter in
this exciting part of London.
Shares rose 1.5 per cent to 234.7p
yesterday.
IN BRIEF
Service price inflation slides
nPrice rises on services remained
slow in the third quarter, according to
official data out yesterday, reaching
their slowest pace of increase since the
end of 2009. Services cost 1.1 per cent
more in the third quarter of 2012 than
in the same period of 2011, according
to the service producer prices index
from the Office for National Statistics,
completely flat on the 1.1 per cent
inflation seen in the second quarter.
Finances still tight as slump ends
nMillions of households are still
struggling with their finances, a
survey out yesterday suggested,
despite an official end to recession.
Some 2.5m homes said they were
unable to pay all their bills, according
to estimates from Legal & General,
stable compared to a year ago, but
some 300,000 more than seen in
2010, before the economy slipped
back into recession. Only 44 per cent
said they had money left after bills.
Japan exports drop for fifth time
nJapans exports fell in annual terms
for a fifth month in October, hurt by
the fallout from a diplomatic row with
China and feeble global demand, a
further sign the economy may be
slipping into recession and adding
weight to calls for policy easing.
Shipments to China, Japans top
export market, dropped an annual 11.6
per cent last month after a 14.1 per
cent fall in September.
REMORTGAGE lending soared
between September and October,
according to data out yesterday,
cementing a solid annual increase.
Gross remortgage lending climbed
from 3.3bn in September to 4.1bn
in October, LMS estimated this morn-
ing, but the improvements could not
erase a significant portion of the loss-
es since before the financial crisis,
when loans typically totalled around
10bn per month.
This 23.1 per cent monthly rise into
October capped off a solid year, dur-
ing which a 5.7 per cent boost to the
average loan size lifted gross lending
up 4.2 per cent, despite a 1.4 per cent
fall in the number of remortgages.
LMS chief executive Andy Knee said
he was pleased with the figures but
suggested some of the rise could be
down to uncertainty about future
market conditions, despite the
Funding for Lending Scheme (FLS).
October showed a consecutive
Remortgaging
still depressed
despite pick-up
BY BEN SOUTHWOOD
month of growth in the total value
and number of remortgages as peo-
ple took the opportunity to snap up
the good deals that are now available
uncertain about just how long they
might be around, Knee said.
Knee, however, expects house prices
to rise further as loans increase.
FLS was devised by the Treasury and
the Bank of England with the aim of
providing as much as 60bn to banks
and building societies at cheap rates,
as long as the money is actually lent
on to customers.
Remortgage leading jumps back
Jan2011 Oct 2012
3.0
3.2
3.4
2.8
3.6
3.8
4.0
4.2
4.4
Total grossvalueofremortgageloans, bn
S
o
u
r
c
e
:

L
M
S
THE GOVERNMENT is pushing
ahead with its benefit reforms too
quickly to properly assess the costs
and benefits, according to a new
report out today from the Work
and Pensions Select Committee.
The universal benefits system is
designed to simplify the current
array of six different out of work
benefits, link benefits more closely
with job-seeking, and withdraw
benefits for up to three years from
those who abuse the system.
But MPs fear the change may be
too quick for those claimants who
BY TIM WALLACE
are not used to taking
responsibility for themselves.
Under the new system, benefits
will be given out each month, not
each week, which MPs warned will
be difficult for those not used to
budgeting. And paying housing
benefit to claimants, not landlords,
again may hurt poor budgeters.
Time needs to be allowed for a
proper evaluation of the pilots
which the government is running
on direct payments to tenants,
after safety net arrangements for
vulnerable people have been
developed and tested, explained
committee chair Dame Anne Begg.
THURSDAY 22 NOVEMBER 2012
18
NEWS
cityam.com
Committee chairperson Dame Anne Begg wants a fuller analysis of the universal credit trials
Licensing Act 2003
Application for a new Premises Licence
Notice is hereby given that MEXICAN GRILL LTD t/a
TORTILLA has applied to the City of London on 12th
October 2012 for a new premises license to use: TORTILLA,
14 UPPER CHEAPSIDE PASSAGE, ONE NEW CHANGE,
LONDON, EC 2V 6AG for the provision of:
A NEW PREMISES LICENSE, WHICH INCLUDES:
(a) SALE OF ALCOHOL FOR CONSUMPTION ON THE
PREMISES: MON SUN 11:00 23:00
(b) PROVISION REGULATED ENTERTAINMENT
(RECORDED MUSIC): MON-SUN: 11:00 23:00
A record of this application is held by the City of London and can
be viewed by members of the public online by visiting
www.cityoflondon.gov.uk or by appointment at the offices of City
of London licensing authority, Walbrook Wharf, 78 83 Upper
Thames Street, London EC4R 3TD
Any person wishing to make a representation in relation to this
application must give notice in writing to the licensing authority at
the address shown above, giving in detail the grounds of
objection by TUESDAY 11TH DECEMBER 2012. The licencing
authority must receive representations by the date given above.
The licensing authority will have regard to any such representation
when considering the application. It is an offence, under section
158 of the Licensing Act 2003, to knowingly or recklessly make a
false statement in or in connection with an application for
premises licence and the maximum fine on being convicted of
such an offence is 5000.
The new
jobs website
for London
professionalsT
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c
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Growth still slow across OECD
group of developed economies
DEVELOPED economies continued
to struggle to find growth in the
third quarter of the year, data out
yesterday suggested.
GDP grew just 0.2 per cent
across the Organisation for
Economic Cooperation and
Development (OECD) as a whole,
in the third quarter, as Japan and
troubled Eurozone economies
weighed on modest expansion in
the US and UK.
Japans economy contracted 0.9
per cent in the third quarter, the
BY BEN SOUTHWOOD
OECD said, the worst result of any
of the so-called major seven
economies Canada, France,
Germany, Italy, Japan, the US and
the UK. But even combined with a
0.2 per cent contraction in the
Italian economy, this decline was
not enough to pull the whole bloc
into decline.
The UK economy bounced back
into expansion, rocketing ahead
with growth of one per cent, while
US GDP expanded 0.5 per cent in
the period.
This data came in tandem with a
separate OECD paper calling for
balanced fiscal consolidation,
combining austerity with pro-
growth measures.
Finding the right balance
between consolidating budgets and
stimulating growth is a challenge
for all governments, said OECD
boss Angel Gurra. While there is
an indisputable need for medium-
term fiscal consolidation...the key
to sustainability is credible
structural reforms that strengthen
public finances, promote long-term
economic growth and support
those hit hardest by the crisis,
Gurra claimed.
US factory activity rebounds
improving hopes over economy
US MANUFACTURING surprised
onlookers with its strength in
November, as data out yesterday
suggested the pace of its recovery
was rebounding.
Other data out yesterday showed
new unemployment insurance
claims were retreating back towards
the levels seen before superstorm
Sandy.
The US yesterday hit 52.4 on
Markits purchasing managers
index (PMI), a prominent business
survey, up from 51 in October, and
further above the 50 level that
indicates no change in overall
conditions. This level was a five-
month high, after conditions in the
US slid, having fluctuated around
BY BEN SOUTHWOOD
55 for most of the recovery period.
The US manufacturing sector
reported the fastest pace of
expansion for five months in
November, said Markit chief
economist Chris Williamson, with
output, order books and
employment all growing at
increased rates. The survey is
consistent with
manufacturing output
growing at an annualised rate
of just over one per cent in
November.
This came as new
jobless insurance
claims bounced back
to 410,000 from
451,000 last week,
having previously
increased by
90,000, a jump that many are
putting down to recovery from the
havoc wreaked by superstorm Sandy.
This left claims 19,000 higher than
a year earlier, on the adjusted
measure, though claims were
actually 397,671 last week some
43,907 lower than during the same
week in 2011. Some economists
thought that even with the Sandy
distortion, the data pointed to a
gloomy employment picture.
Peter Hooper at Deutsche
Bank said: It would not be
surprising if some of the
new claims are due to
underlying weakness in
the labour market.
A CRACKDOWN on tax avoidance
schemes raked in an additional
200m for the government in the
last year, according to estimates
published yesterday by the
National Audit Office (NAO).
But HM Revenue and Customs
is still missing out on 5bn from
continued tax avoidance that
is, using the tax law to get a tax
advantage that parliament never
intended, though the practice is
not illegal.
Despite HMRC introducing 93
new rules to cut down on
avoidance, the NAO found no
evidence that their usage is
Taxman missing out on billions
because of avoidance schemes
BY TIM WALLACE
falling.
Over 100 new schemes were
disclosed in the last four years,
and HMRC believes most would
be defeated if tested in court,
but that takes time to achieve.
It is inherently difficult to
stop tax avoidance as it is not
illegal. But HMRC needs to
demonstrate how it is going to
reduce the 41,000 avoidance
cases it currently has open, said
the NAO, calling for HMRC to be
more aggressive in bringing in
the dodged taxes.
But the NAO did find the
larger tax law firms had reduced
activity in the sector, promoting
fewer schemes to clients.
After facing Romney, Obama
must face down the economy
MPs: Slow down benefit reform
to help jobless learn to budget
IN BRIEF
Pre-tax profits jump 37pc at HICL
nInfrastructure investment company
HICL yesterday posted a 37 per cent
increase in pre-tax profit to 42.2m
over the six months to September.
Over the period it made total
investments of 106.4m, including in
four PFI projects such as Romford
Hospital and Stoke Mandeville
Hospital. The investment company
also raised 250m from a new C share
issue earlier this year.
Optos boosted by Daytona device
nMedical technology company Optos
yesterday reported revenue of
$196.4m (123.3m) over the year to
September, a 37 per cent increase
from last year, helped by the roll-out
of its Daytona device that made $21m
in revenue over the 12 months. Pre-tax
profits rose 16 per cent to 26.3m. The
firm added that it planned to expand
its product range and into new
geographies, on the back of strong
revenue growth.
Pirc blasts lack of Aquarius vote
nShareholder body Pirc has sounded
a warning on the lack of vote for miner
Aquarius Platinums remuneration
policy, recommending that investors
oppose the re-election of non-
executive director and chairman of the
remuneration committee Edward
Haslam at the annual meeting. Pirc
said yesterday it had serious
concerns over remuneration at the
South African miner which has been
hit by industrial action at its Kroondal
mine because shareholders are
unable to vote on it.
THURSDAY 22 NOVEMBER 2012
19
NEWS
cityam.com
REVENUE at speciality chemicals
company Johnson Matthey sank 17
per cent over the half year to
September, as it was hurt by falling
platinum prices.
Operating profit for the precious
metals division was down 33 per cent
to 71.8m, while sales were down
five per cent over the half year, hurt
by lower average precious metal
prices.
In its first half, the average price of
platinum was down 16 per cent year
on year at $1,500 (942) an ounce.
As a result, the blue chip company,
which is a large supplier of vehicle
catalytic converters, said that per-
formance in the second half would
be broadly flat on the first half.
Whilst precious metal prices have
improved from their lows during the
summer, largely due to the labour
unrest in South Africa, the outlook
in some of our other markets has
weakened and visibility remains lim-
ited, Johnson Matthey said.
It added that global demand was
Platinum prices
affect Johnson
Mattheys sales
BY CATHY ADAMS
expected to stay broadly stagnant,
although supply would fall sharply
thanks to industrial action in South
Africa.
The group said pre-tax profit fell six
per cent to 183.4m over the period,
from 195.1m over the same period
in 2011.
Outside of the precious metals divi-
sion, the environmental technologies
arm posted a three per cent increase
in sales, with operating profit up 17
per cent over the six months.
Shares closed down 5.81 per cent at
2,190p, making it the biggest faller on
the FTSE 100 yesterday.
Compass beefs up buyback in
spite of its European troubles
COMPASS Group, the worlds biggest
caterer, posted a nine per cent rise
in full-year profit yesterday, and
pledged to return a further 400m
to shareholders.
The group, which serves 4bn
meals a year in 50 countries, said it
will add to its buyback scheme next
year, in addition to its 500m
scheme expected to end this year.
Underlying operating profit rose
nine per cent to just under 1.2bn in
the year to 30 September, in line
with a company compiled analyst
consensus. Revenue grew eight per
cent to 16.9bn.
BY CITY A.M. REPORTER
When one-off items such as a
shake-up in Europe are included, pre-
tax profits fell 17.6 per cent to
789m.
Compass, which provides catering
and support services to companies,
schools and sports venues, said new
work at its North American business
worth almost half of group
revenue had driven group profit.
Revenue in its emerging markets
division grew by 13.7 per cent, with
Europe, a weak spot for the firm, up
0.4 per cent.
In September Compass announced
it would slash its southern
operations by a quarter, exiting
contracts and non-core activities in
countries like Spain, Italy and
Portugal, where tough economic
conditions have hit hard.
The firm said it expects to meet
expectations in 2013 as a result.
Johnson Matthey plc
21 Nov 15Nov 16Nov 19Nov 20Nov
2,260
2,280
2,300
2,320
2,180
2,160
2,200
2,220
2,240
p
2,190.00
21Nov
Compass Group PLC
21 Nov 15Nov 16Nov 19Nov 20Nov
690
695
700
705
685
p 699.50
21Nov
MOTHERCARE has hired the
finance director of Argos to help
the struggling retailer with its
transformation plans.
Matt Smith, a former KPMG
director who has spent 10 years at
Argos parent firm Home Retail
Group, will join the firm at a date
yet to be announced.
Mothercare has stepped up its
fight to halt declining sales by
taking on Lovefilm boss Simon
Calver as its new chief executive
in April.
Mothercare hires Argos finance
boss to help with turnaround
BY HARRY BANKS
He has pledged to be ruthless
on costs a tough stance that
delivered a 0.3 per cent rise in
like-for-like sales in the three
months to 13 October.
Chairman Alan Partner said
yesterday: I am extremely
pleased that we have found
someone with the skills and
leadership qualities to support
Simon and the other members of
the executive management team.
Shares in Mothercare, which
have gained around 70 per cent
since Calvers appointment, closed
2.3 per cent lower at 292p
yesterday.
New Mothercare boss Simon Calver has been closing branches to help stem losses
BOTTOM
LINE
MARC SIDWELL
Compass heads in the right direction thanks to Cousins
C
HIEF executives take a lot of
criticism, but some firms
demonstrate what a difference
the right boss can make. Six
years ago, Richard Cousins stepped
into the top role at Compass,
following a series of profit warnings
by the global contract catering firm.
Compass latest results are more
solid than stellar, but Cousins
presence still gives good reason to
trust Compass direction of travel.
Before taking on the caterer,
Cousins had led BPB into the FTSE
100, quadrupling its market cap
and then negotiated a significantly-
improved bid from Saint-Gobain
during its hostile takeover. At
Compass, he showed the same
ambition and willingness to make
tough decisions, pulling out of
some 50 countries within the first
year and a half and disposing of
3bn in tangential business
ventures to restore health to the
corporate balance sheet.
Cousins retrenchment paid off.
Today Compass is growing and well-
positioned to benefit from global
opportunities, with nine per cent
growth in new business over the
year and a positive like-for-like trend
in fast-growing and emerging
markets, which now account for
18.6 per cent of group revenues.
Thats not to say market
conditions are easy, especially in
Europe, where declining like-for-like
volumes have forced cost saving
measures. The 400m share
buyback announced yesterday
wasnt as big as some had hoped,
and a spot of profit taking followed.
But a company that specialises in
saving organisations money by
outsourcing catering and other
services looks well-placed in a world
where governments and
corporates everywhere are looking
to the bottom line. Cousins earned
2.3m in 2011 including all benefits
and bonuses. The company
increased its revenues by 1.25bn
between 2011 and 2012. A good boss
is worth the money.
PLATINUM WEIGHS ON MATTHEY
Sometimes a sector delivers a perfect
storm. Johnson Matthey, the worlds
largest manufacturer of catalytic
converters, had gloomy half-year
numbers yesterday, with profit
before tax down six per cent, and
warned of more of the same to
come. The main culprit is low
platinum prices, a key ingredient in
catalytic converters.
Even unrest at South African
mines wasnt enough to drive
platinum to old highs. Johnson
Mattheys precious metals divisions
underlying operating profit fell by a
third and revenue by 22 per cent.
Low prices in the precious metal
are compounded by declining
demand for new cars in the
troubled Eurozone. The most
important category of catalyst for
Johnson Matthey is light vehicles,
accounting for two thirds of sales.
Europe is the most important single
market for these catalysts: 57 per
cent of sales in the first half of 2012.
As a result, a nine per cent fall in
European sales year on year cost the
firm 25m where an 18 per cent
boost in US sales only added 15m.
Even the strongest chief executive
would struggle to mine good news
out of these grim realities.
INCREASED revenues from the
Middle East and Asia boosted pre-
tax profit at design and
engineering consultancy Hyder
Consulting in the six months to
September.
Pre-tax profit jumped 28 per
cent to 12m, flattered by a 19 per
cent increase in revenue from Asia
Pacific, and a 15 per cent jump in
revenue from Middle East. Over
the six months revenues came in
at 66.9m and 36.4m respectively.
Hyder which designed the
iconic Burj Khalifa building in
Dubai enjoyed a 145 per cent
increase in operating profits in the
Middle East, helped by a number
of new contracts in the region.
Hyder Consulting gets boost
from Middle East contracts
BY CATHY ADAMS
Revenues in Europe declined to
46.7m, down from 51.6m over
the same period last year, as
market conditions remained
challenging. Hyder, which had a
role in the new London Bridge
station, said the utilities sector
was affected by some project
delays, and the property sector
remained subdued.
As evidenced today, we believe
the business continues to be
conservatively managed and
believe prospects for continued
growth remain encouraging,
particularly with Middle East
activity picking up, analysts from
Espirito Santo said yesterday.
Shares soared in trading yesterday,
to close up 11.27 per cent at
419.5p.
IN BRIEF
Stena Line chief exec to retire
nThe chief executive of Stena Line
yesterday stepped down from the
role after more than 10 years in
charge of the ferry company. Gunnar
Blomdal will leave his post on 1
January, but will remain on the board
of some firms within the wider Stena
Group. Carl-Johan Hagman, currently
Stena Line chairman and head of
shipping for the group, will take on
the chief executive role. Privately-
owned Stena Line is one of Europes
biggest ferry operators, running
North Sea crossings between the UK
and the Netherlands as well as a new
Liverpool to Belfast ferry.
EU wants regulation on shale gas
nEU politicians have rejected a ban
on shale gas, while calling for a robust
regulatory regime to address
environmental and other concerns, in
a series of votes yesterday in the
European Parliament. Fracking, or
hydraulic fracturing, involves pumping
water containing chemicals into shale
rock formations at high pressure. The
votes rejected a call for an outright
ban on new fracking activity, saying
EU member states had the right to
explore their reserves. However, two
separate votes vetoed swift shale gas
development citing concerns over the
environment.
CORRECTION
nIn our edition dated 21 November,
we said Steve Chamberlain had been
Autonomys chief financial officer. He
was in fact vice president of finance.
DEFENCE tech group Qinetiq said
its first half performance had been
strong, in spite of cuts to govern-
ment spending in the UK and US.
The firm yesterday posted a seven
per cent drop in revenue for the six
months to the end of September to
685.5m.
Underlying pre-tax profit rose 21
per cent to 85.8m. On a statutory
basis, profit before tax rose 9.1 per
cent to 80m.
While visibility remains very
limited while the worlds biggest
economy takes an axe to its defence
spending, Qinetiq thinks it will
meet expectations for the year.
Revenues in the States tumbled
by 10 per cent to 241.6m in the
period.
Qinetiqs UK services arm, which
offers cybersecurity, training and
testing to the Ministry of Defence
and security agencies, posted
broadly flat revenues of 289.6m.
Cost savings helped boost the
Qinetiq copes
well in spite of
defence cuts
BY MARION DAKERS
units operating margin from 9.6 to
13.2 per cent.
The group had 21.5m net cash on
its balance sheet at the end of the
period up from a net debt of
145.3m a year ago, when the firm
was in the midst of a restructuring.
This figure was boosted by a one-
off payment of 65m from the MoD
to tidy up historic liabilities.
Shares in the FTSE 250-listed com-
pany have risen over 40 per cent
since the start of the year, and
closed up 0.41 per cent at 196.5p
yesterday.
Tractor-maker Deere falls short
of forecasts after its costs surge
DEERE & Co, the worlds largest
farm equipment maker, reported a
weaker-than-expected quarterly
profit yesterday as higher
manufacturing costs and other
expenses cut into earnings and a
strong dollar reduced the value of
international sales.
US-listed Deere forecast
higher sales and earnings for
its new fiscal year, but its
shares fell almost four per
cent in early trading.
Net income rose to $687.6m
(431m), or $1.75 per share,
in the three months to the
BY HARRY BANKS end of October, from $669.6m or
$1.62 per share, a year earlier.
The results missed the analysts
average estimate by 13 cents a share,
according to Thomson Reuters.
Overhead costs and spending on
research and development rose by
about $100m from the previous
quarter, JP Morgan
analyst Ann
Duignan said
in a note to
clients.
Expectations were high coming
into this report, she added.
Research and development
expenses were up about 14 per cent
year-over-year, Deere said, while
selling, administrative and other
costs rose nine per cent, partly
because of increased incentive
compensation, according to
presentation materials ahead of the
companys earnings conference call.
Sales rose 14 per cent to $9.79bn,
with equipment operations
contributing $9.05bn. Analysts were
expecting sales of $8.85bn.
Imagination up against a rival
bidder in race to snap up MIPS
IMAGINATION Technologies $60m
(37.6m) pursuit of the operating
business of MIPS Technologies faces
competition after the target
company received a higher bid from
a rival firm.
Shares in FTSE 250-listed
Imagination closed down 3.8 per
cent after the bid from CEVA
emerged.
Imagination, which is looking to
buy the MIPS business to gain
patents and step up its challenge to
an increasingly dominant ARM
Holdings, said yesterday that the
MIPS board continues to
BY HARRY BANKS
recommend its offer.
That could change, however, after
MIPS said it will start talks with
mobile chip designer CEVA, which
has made a $75m bid, as MIPS
believes that proposal could lead to
a superior deal.
Imagination is monitoring the
situation and will provide a further
update in due course, the British
company said in its statement.
Imagination announced its
intention to buy MIPS earlier in
November. It plans to fund the
purchase using existing cash
reserves, and has said the
acquisition would add to earnings
by 2014.
MIPS technology is used in blu-ray
players, digital televisions and video
games consoles such as the Sony
PlayStation 2. It owns around 580
patents.
Qinetiq Group PLC
21 Nov 15Nov 16Nov 19Nov 20Nov
194
196
198
200
190
192
p
196.50
21Nov
Imagination Technologies Group PLC
21 Nov 15Nov 16Nov 19Nov 20Nov
440
450
460
470
410
420
430
p
423.67
21Nov
Deere & Co has been selling more
tractors and farm equipment
VIEWERS of Downton Abbey
might be used to dramatic
cliffhangers, but yesterday the
threat of another plot twist was
removed, after the culture
secretary renewed Channel 3s
broadcasting licence for another
10 years from 2014.
Culture secretary Maria Miller
said that the extension for Channel
3 and Channel 5 will secure around
800m in investment for original
content across the two channels.
As part of the deal, ITV has been
asked to provide more for
ITV and Channel 5 to get new
licences but must offer more
BY MARION DAKERS audiences in Scotland and the
Borders, after the firm proposed
cutting back on local
programming. Channel 5 must
offer more for children.
Channel 3 licences are held by
ITV in England and Wales, STV in
Scotland and UTV in Northern
Ireland.
Richard Desmonds Northern &
Shell holds the licence for Channel
5.
Following Millers approval,
broadcasting watchdog Ofcom will
start negotiations with the licence
holders about the financial terms
of the renewals.
THURSDAY 22 NOVEMBER 2012
20
NEWS
cityam.com
Downton Abbey is among the original programming produced for ITV
OLAM took its battle with short-
seller Muddy Waters to court
yesterday as the Singaporean
commodities trader fought off
criticism of its accounting
practices and debt levels that hit
its bond and share prices.
Olam, 16 per cent owned by
Singapore state investor Temasek,
has filed a suit against Muddy
Waters and its founder Carson
Block in the High Court of
Singapore, alleging libel, slander
or malicious falsehoods for
statements Block made at a
London conference on Monday, a
company spokeswoman said.
She said Olam was seeking
unspecified damages.
Singapores Olam to sue short
seller and critic Muddy Waters
BY CITY A.M. REPORTER
We have not received a lawsuit
and, should we have to defend
ourselves, we will do so
vigorously, a Muddy Waters
spokesman said.
Muddy Waters, which makes
money by betting against
companies, has issued devastating
reports in the last few years,
mainly aimed at China-based
firms. Some of the reports crushed
shares of the targets, although
others were able to recover.
Blocks comments, which had
singled out Olams accounting
practices and questioned its
prospects, triggered a fall in
Olams Singapore-listed shares on
Tuesday of 7.5 per cent.
The stock rose 5.3 per cent
yesterday.
RANDSTAD, the Dutch staffing
company, yesterday warned of a
continued fall in revenue and said
it would change its dividend policy
in 2013 to cope with the ups and
downs of different regions and
higher earnings volatility.
For the whole firm, revenue per
working day fell six per cent in
October organically compared
with last year, but sales were stable
in North America and nine per
cent lower in Europe, Randstad
said in a statement yesterday.
The Netherlands and Belgium
declined at a similar level as in
September whereas the decline in
France (minus 14 per cent) and
Germany (minus 9 per cent) was
Randstad changes dividend
policy after revenues plunge
BY CITY A.M. REPORTER
more pronounced, said Randstad,
the worlds second-largest staffing
firm.
Adecco, the worlds biggest
staffing group, said two weeks ago
it did not expect improvement in
Europes job markets until late
next year because businesses are
reluctant to hire due to
uncertainty about the Eurozone
debt crisis.
Randstad said it would change
its dividend policy as of 2013,
switching to a pay-out ratio of 40
to 50 per cent of adjusted earnings
per share, and a choice between
stock and cash dividend. It will
also plan anti-dilution measures,
including share buy-backs, when
the companys financial position
allows it, it said.
THURSDAY 22 NOVEMBER 2012
21
Wall St trades
higher ahead of
Thanksgiving
U
S stocks finished modestly
higher yesterday, with the S&P
500 up for a fourth session
although trading volume was
one of the years lowest on the day
ahead of the Thanksgiving holiday.
Investors welcomed news that a
ceasefire was declared to end the flare-
up in violence between Israel and the
Palestinians, though the lack of a deal
to release emergency aid for Greece
limited the markets advance.
Investors also remained anxious
about the mandatory tax increases
and spending cuts that would go into
effect in the new year if a deal is not
reached to prevent it known as the
fiscal cliff though policymakers
are not expected to get back to negoti-
ations until after Thursdays
Thanksgiving holiday.
About 4.6bn shares traded on the
New York Stock Exchange, the Nasdaq
and the NYSE MKT, compared with
year-to-date daily average volume of 6.5
billion shares. Today the US stock mar-
ket will be closed for the Thanksgiving
holiday, and on Friday, it will close
early at 1 p.m. (1800 GMT).
Fears that the fiscal cliff discussions
in Washington could be drawn out or
yield no resolution have been at the
forefront of investors' minds in recent
weeks. Combined with concerns about
the Eurozones continued debt prob-
lems, the worries had driven a sell-off
that has taken more than 5 percent off
the S&P 500 since Election Day in early
November.
The Dow Jones industrial average
gained 48.38 points, or 0.38 per cent, to
12,836.89 at the close. The Standard &
Poors 500 Index added 3.22 points, or
0.23 per cent, to 1,391.03. The Nasdaq
Composite Index rose 9.87 points, or
0.34 per cent, to close at 2,926.55.
S
hares rebounded from early falls
for the second session in a row
yesterday, with a rising oil price
supporting energy stocks to lead
British blue chips higher.
The FTSE 100 index gained 3.93 points, or
0.1 per cent, to finish at 5,752.03 points in
thin trade of only 85 per cent of the aver-
age 90 day volume.
Energy stocks added five points to the
index, supported by a spike in the oil price,
which gained more than $1 (63p) after a
bomb blast in Tel Aviv threatened to derail
hopes for a truce between Israel and
Palestine and raised the prospect of a
wider regional conflict. We have seen in
the last couple of hours people coming in
for the energy names, albeit in low vol-
umes, Steve Asfour, head of sales trading
at Fox Davies Capital said.
One such stock was BG, which led FTSE
100 gainers, rising 2.8 per cent. The gas
company had shed over a quarter of its
value in less than a month after forecast-
ing no growth in 2013 in a trading update.
Utilities also supported the rise, led by a 1.9
per cent rise in United Utilities after a clar-
ification by sector regulators struck a more
conciliatory tone.
Basic materials suffered, with miners los-
ing 0.5 per cent as growth worries hit com-
modity prices.
The copper price fell 1.3 per cent as the
Federal Reserve chairman cautioned over
the prospect of growth in the United States
given tricky fiscal negotiations, and
Greece's international lenders failed to
agree on an aid package for the country.
UK stocks dropped three per cent last week
but their losses were mostly reversed on
Monday.
UK shares rebound led by energy
rises despite thin trading volumes
BESTof theBROKERS
Direct Line Insurance
15Nov 16Nov 19Nov 20Nov 21Nov
p
198
196
197
194
195
193
196.55
21 Nov
DIRECT LINE
RBC has an outperform
rating on the newly-
listed insurer with a price
target of 230p. The
broker sees Direct Line as
well placed to use its
scale to fend off price
comparison sites.
DASHBOARD CITY
YOUR ONE-STOP SHOP FOR JOB MOVES,
BROKER VIEWS AND MARKET REPORTS
cityam.com
FTSE
21Nov 15Nov 16Nov 19Nov 20Nov
5,775
5,750
5,725
5,675
5,650
5,625
5,700
5,752.03
21 Nov
British Land Company PLC
15Nov 16Nov 19Nov 20Nov 21Nov
p
530
520
525
510
515
525.00
21 Nov
BRITISH LAND
Morgan Stanley has
upgraded the property
firms rating to
overweight and hiked
its target from 540p to
570p. It sees the scales
tipping towards better
yields for the firms
assets.
Bloomsbury Publishing PLC
15Nov 16Nov 19Nov 20Nov 21Nov
p
121.0
120.0
120.5
119.0
119.5
118.5
121.00
21 Nov
BLOOMSBURY
Peel Hunt maintains the
publishing groups target
price of 150p but raises
its target from hold to
buy after the shares
traced back. The broker
has calculated a sum of
the parts value of 180p.
Cushman & Wakefield
Robert Murphy has been
appointed partner and head of
City of London development in
the commercial real estate
service firms London markets
team. He joins from CBRE, where
he was a senior director in its
central London development
team.
Picton
Fraser DArcy has been appointed to the newly-created role
of investment director in the property investment firms
investment management subsidiary. He joins from
Threadneedle Investments, where he was an investment
surveyor. DArcy has also worked at Insight Investment
Management and Scottish Widows Investment Partnership.
Numis
The investment bank has appointed a new mining team.
John Prior has been made director in corporate finance, and
Matthew Hasson joins as director in mining specialist sales.
They both join from Collins Stewart/Canaccord, the
investment bank, and have both also worked at Arbuthnot.
Goodwin Procter
Ben Eaton has been made a partner in the law firms tax
practice. He joins from Allen & Overy, where he was counsel
in its tax department. Eaton specialises in tax matters
involving investment funds and real estate transactions.
Psigma Investment Management
Tina Wishart has been appointed compliance officer at the
investment management firm. She joins from Williams de
Bro, where she was head of compliance. Wishart has 20
years experience in financial services.
Seymour Pierce
Angelos Anastasiou has been appointed to the position of
utilities sector analyst at the investment bank. He joins from
Williams de Bro/Evolution, where he held a similar role.
WHOS SWITCHING JOBS Edited by Chris Harlow
+44 (0)20 7092 0053
morganmckinley.com
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W
HEN it comes to the
economy, banks are
usually seen as the
problem. But they are
really part of the solution.
It is not just that financial services is
a major sector in the British
economy generating more net
export earnings than the rest put
together, and creating hundreds of
thousands of jobs. Banking is more
than one industry among many. Its
the vital lifeblood of our market
economy.
The rest of the economy the real
economy, as some like to call it
depends on banking. And as it serves
every business in the country, from
start-ups to global corporations, the
industry has insight into what needs
T
ODAY David Cameron travels
to Brussels to take part in a
critical summit on the EUs
budget from 2014 to 2020. The
occasion will involve more
than just budget negotiations,
however.
This summit has implications for
both the City of London and the UKs
broader position within the EU areas
where the coalitions approach is
more short-term tactical expediency
than long-term strategy.
Consequently, its ability to dictate
terms on these two vital matters is fast
eroding.
Historically, there are two models of
a successful financial centre. The first
an onshore version is a hub city
that services a sizeable domestic mar-
ket. Think New York. The alternative is
an offshore approach, which depends
on attracting business via competitive
tax rates and other selling points like
a respected legal system and a skilled
workforce. Think Switzerland.
Until the 2008 financial crisis, the
City enjoyed elements of both and
benefited handsomely. It took on the
cityam.com/forum
Talk of fundamental
renegotiation is illusory
and the government
has no clear answer
THEFORUM
Twitter: @cityamforum on the web: cityam.com/forum or by email: theforum@cityam.com
Agree? Disagree? Got a sharp comment?
The Forumwants you to join the debate.
Top responses will be reprinted in The Forum.

22
THURSDAY 22 NOVEMBER 2012
MARK FIELD
Theres no third way for the City in
Britains relationship with the EU
role of an offshore-onshore financial
centre to the European continent and
developed a light-touch regulatory
approach that attracted huge volumes
of foreign money. But the arrival of
the financial crisis fundamentally
changed the rules of this game.
Since 2008, the Eurozone has
demanded greater oversight of its
financial infrastructure. It has asked
awkward questions about the ability
of UK regulators to prevent the system
silting up, and about whether it is sus-
tainable for euro-denominated risk to
be cleared offshore in London. In
turn, the City has questioned how
long it can avoid being infected by EU
financial directives without its com-
petitiveness being fundamentally
damaged.
The invoking of the British veto at
last Decembers EU summit was billed
as an aggressive demonstration of the
UKs intention to retain the Citys off-
shore/onshore model. But to many EU
partners, it was seen as an unrealistic
and petulant attempt to maintain an
unsustainable status quo.
In reality, that veto was less about
the future of the City and more a
political gesture aimed at keeping
eurosceptic wolves from the door, ide-
ally until well beyond 2015. The back-
drop to that last summit was an
unexpectedly large rebellion in sup-
port of an EU referendum. Yet the
Prime Ministers superficially popular
move only hardened eurosceptics
resolve to extract further concessions.
Since then, matters have moved on
apace. The EU is finalising work to set
up a single bank supervisor.
Meanwhile, the coalition has failed to
see off another rebellion on the UKs
relationship with the EU, this time
over its budget. Another summit
showdown is surely inevitable.
The uncomfortable truth is that
there is no third way in the UKs rela-
tionship with Europe. The Prime
Ministers understandable instinct is
to play for time to placate euroscep-
tic passions with aggressive talk about
renegotiating our relationship with
Brussels, while smoothing relations
with European partners behind the
scenes. But this approach is no substi-
tute for a clear view about how
Britains economic interests are best
served, and particularly how the City
our only substantial, globally com-
petitive industry should evolve.
If the Prime Minister sees our future
in the EU, with the City remaining
closely integrated into the vast domes-
tic European market, a collaborative
approach with our European partners
is now required. This path will involve
facing down UK eurosceptics. Time
will also need to be spent extracting
the best deal for the City through care-
ful diplomacy and the building of
alliances.
If, however, he truly believes that the
raft of EU directives coming this way
are anathema to the long-term inter-
ests of the City, and that its future is
best served by adopting an offshore
model, a path towards British with-
drawal from the EU will need to be
sketched out before long.
Talk of fundamental renegotiation
is illusory. We may not like it but,
when it comes to the EU and the City,
the choices ahead for the UK are
increasingly binary. This has arisen
because of the absence of any strategy
on how we see the City operating in
future and what relationship Britain
should enjoy with the EU in the years
ahead. As it stands, the UK govern-
ment has no clear answer on either of
these issues. This is a perilous position
for the national interest.
Mark Field is Conservative MP for the
Cities of London and Westminster.
to be done to get the economy
purring again.
Every business in the country has
at least one bank account. They go to
banks to raise money for investment
from a loan to an independent
price offering or to fund their
current operations. They use banks
to pay providers and get paid by
customers. They need banks to
finance exports, to hedge against
movements in currency prices or
commodity prices. They go to banks
when they want to expand, or to
take over competitors. All these
actions are vital to the successful
running of the UK economy.
Given this, I have today written to
the chancellor, ahead of his Autumn
Statement in December, with
proposals to spur UK growth. Theyre
not aimed at helping banks, but
helping banks business customers.
The problem is that businesses are
sitting on piles of cash theyre too
worried about the future to spend or
invest. The critical issue for the
government, therefore, is getting
this investment flowing. So first, it
should consider a 100 per cent
capital allowance for a limited
period of two years, providing a huge
incentive for businesses to invest
now and help build the momentum
behind the recovery.
The government should also
extend the capital gains tax holiday
under the Seed Enterprise
Investment Scheme (SEIS) for a year.
This would allow time to raise
awareness and to get business angels
investing in start-ups.
Further, it should reexamine its
plans on encouraging lending. The
chancellor should reconsider
whether funds from Big Society
Capital would find a quicker route to
businesses if they were funnelled
through community development
financial institutions. It should
similarly look at whether its planned
business bank could instead play a
clearing house role between
businesses seeking finance and
sources of finance. It should also
review recent proposals from the
Financial Services Authority, which
hamper banks from referring
businesses to angel investors.
There are countless other ideas
worth considering from fast-
tracking planning applications by
small to medium-sized enterprises to
to removing stamp duty on growth
market company shares. But its only
with policies like these that we can
get the economy moving again. And
banks wont be the problem, but
part of the solution.
Anthony Browne is chief executive of the
British Bankers Association.
ANTHONY BROWNE
Banks arent the problem: Theyre the lifeblood of UK economic growth
MORNING UPDATE
A.M.
23
THURSDAY 22 NOVEMBER 2012
The Forum is open for you to take part. Got a sharp comment on
one of todays columns? Do you have another subject you want
to share your opinion on? We want to hear your views.
Email theforum@cityam.com or comment at cityam.com/forum
The cost of saving
[Re: Fresh allegations overshadow welcome
cultural shift in the City, yesterday]
As a higher rate tax payer I benefited
enormously from the 40 per cent tax relief
on my pension contribution. But I was struck
by the discrepancy between my position and
that of my wife. As a lower rate taxpayer, she
only received 20 per cent relief. Why should
those earning the most get twice as much
relief? And it was especially noticeable at the
20 per cent tax rate how year-on-year fund
charges ate into the pot. If there was a flat
rate of relief, it would be both simpler and
fairer. I also wonder whether this would
provide an impetus to reduce pension fund
charges to the levels enjoyed by Denmark
and Netherlands.
Robert Clark
Simple taxation
[Re: It is shocking just how much tax most
workers have to pay, Tuesday]
Any business owner can tell you who really
pays corporation tax if a business is to
remain solvent, it is always the buyer of the
product or service. And the ultimate buyer is
the individual consumer, who spends with
his or her own after tax money.
Eric Forster
[Re: A radical proposal to rid Britain of its
painful tax on jobs, Monday]
Merging income tax and national insurance
makes sense. But we need to tax all income
at the same rate. Separating dividends and
pension income from labour income makes
little sense if we want simplification.
JonathanHill
R
OMAN Abramovichs
decision to dismiss Roberto
di Matteo, barely six months
after his coach won him the
European Champions
League for the first time in Chelseas
history, has been roundly criticised
by many who follow football.
Commentators deplore the oli-
garchs inability to settle on a manag-
er and give his club stability. Di
Matteo is the eighth manager to have
taken (and lost) the Stamford Bridge
hot seat in nine years. There is also
criticism about the savage way
Abramovich treats the club as his
plaything; that, in short, he is unsuit-
able to own a football club.
As a Chelsea supporter since child-
hood, however, Im a fan of
Abramovichs reign. This judgement
doesnt come without reservations
and I have more than a few of those
about last nights appointment of
Rafa Benitez. But in life, and especial-
ly in football-supporting (through
thick and thin, and all that), nothing
is perfect. Of course, things could
always be done better at an institu-
tion that has to serve as many inter-
ests as a football club especially
under intense media scrutiny.
But few can deny that Abramovich
has revolutionised Chelsea. He has
ploughed millions into playing staff
and training facilities, exploited its
potential overseas, and employed
commercial executives, like Peter
Kenyon (since departed), who have
adopted sensible admission pricing
policies that have mostly ensured a
full stadium. There is even a forum
that takes into account the views of
the clubs fans.
What a contrast to the previous
owner Ken Bates. He bought the club
for 1, but struggled to give it the
investment it needed, leading to a
period of relative underperformance,
relatively high admission prices and
TOP TWEETS
A close look at UK borrowing is horrible. The
budget deficit is up 10bn in 2012 on 2011.
The Tories arent cutting spending enough.
@greglovelluk
A poll by Lord Ashcroft shows the tricky
nature of deficit politics. If Labour took a hard
line, it could secure 10 per cent more votes.
@mmcternan
The coalitions alleged healing of the UK
economy is being subsidised by more
borrowed money.
@toytown
Its unclear whether the Eurozone
experiment can continue. It might survive,
but only by losing a limb or two.
@paragonalert
Will HPs allegations against Autonomy
damage the reputation of UK start-ups?
YES
This case is hugely embarrassing. Although the former
management of Autonomy has completely denied these
allegations, the fallout could still be enormous. The seriousness is
underscored by the fact that HP reported the case to the US
Securities and Exchange Committee and the UKs Serious Fraud
Office. A deal on this scale was always going to be challenging,
but to have a valuation that was so far out by a wide margin
suggests that something serious was missed. All deals must, of
course, be taken on their own merit, and this isnt necessarily
indicative of what is going on across the industry. But if there are
question marks over the judgement of some of the individuals
involved, all British companies could find it difficult to attract
investment in the future.
Mike Franklin is head of investment strategy at Beaufort
International.
Mike Franklin
NO
Dan Wagner
Hewlett Packards allegations against UK tech giant Autonomy raise
the spectre of a loss of trust in British tech business at the very time
that the government is trying to ensure it thrives. But the UK has
long been the home of world-class discoveries and ideas and, many
have grown into world-class businesses. We also have a reputation
for integrity in business. Clearly the onus is on individual businesses
to be transparent in the way they record and report information to
retain the confidence of its shareholders and investors. Whatever the
eventual outcome of the case (and Autonomy completely denies the
allegations), it is unlikely that adverse publicity will spoil the
ambitions of our fledgling tech companies which have the potential
to become world-class enterprises. We need to ensure they receive
every chance to demonstrate their worth and lead us out of
recession.
Dan Wagner is chairman and chief executive of mPowa.
RAPIDresponses
Why I still support
Abramovichs rule
at thriving Chelsea
often a half-empty stadium.
Bates used to sack managers with
some rapidity. The difference is that
few outside of the clubs then modest
fan-base used to care. Now events like
these, or players misdemeanours,
make headlines across the world.
Captain John Terrys recent tribula-
tions, for example, warranted an arti-
cle spread over several pages in the
New York Times.
When experts criticise the
Russians impatience with managers,
they ignore his success. If changing
managers on a regular basis was such
a bad thing, then Chelseas consisten-
cy over the past decade has proven
that theory wrong.
Of course, some might prefer the
club to adopt a more stable manage-
ment tenure, like Manchester United
has enjoyed with Sir Alex Ferguson.
But this is an anomalous situation in
the world of football and not the
norm. And, as far as owners go, I
would rather have one with
Abramovichs obvious ambitions for
on-field success, than be saddled
with Uniteds Glazer family, which
appears more interested in the bot-
tom-line.
Abramovich is not trying to harm
or hurt the club by sacking di Matteo.
As much as I respect the clubs for-
mer coach for being such a decent
guy and winning the trophy Chelsea
fans have craved for the last decade,
the owner is right to do what he
thinks will keep the recent run of
incredible success going.
David Hellier is deputy editor of City A.M.
DAVID HELLIER
Printed by Iliffe Print Cambridge, Winship Road, Milton, Cambridge CB24 6PP
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T
HE decision to sign up to an
MBA programme should not be
taken lightly for a whole host of
reasons. The two-year, full-time
programme is expensive and, in
applying, candidates are choosing to
voluntarily leave the workplace, pay
tuition fees, and dig into their
savings to fund their living expenses.
This may in part explain the find-
ings of a recent Graduate
Management Admission Council
(GMAC) survey of 744 MBA and other
business programmes worldwide. It
revealed a decline in the average
number of applications for two year
courses of 22 per cent in 2012, follow-
ing a 10 per cent decline in 2011.
Research from the Association of
MBAs (AMBA) similarly revealed an
overall 15 per cent decline in MBA
applications for UK schools in 2011
compared with 2010, and the 2012 QS
TopMBA.com survey showed a contin-
ued increase in potential applicants
seeking programmes that last for less
than 18 months. But why is this
change taking place?
KEY INFLUENCES
Students on UK full-time MBAs are
largely international, so the British
governments recent changes to inter-
national student visas, and the
increasing quality of management
education in other regions, has
inevitably influenced candidates
decision-making processes.
Indeed, AMBAs intake and gradua-
tion study shows that there was an
average 4 per cent increase in applica-
tions and a 20 per cent rise in MBA
enrolments in Latin America. In
China and Hong Kong there was an
average 60 per cent increase in appli-
cations. Part-time MBA applications to
business schools based in China and
Hong Kong also increased by 85 per
cent. George Murgatroyd at AMBA
believes this is emblematic of the sig-
nificant growth in the MBA market in
this region.
ADDED VALUE
MBA applicants and students are also
extremely conscious of their return
on investment (ROI). This is especially
the case during a period of prolonged
economic volatility, and therefore
studying for a shorter duration means
the opportunity costs are not as
great, delivering a safer ROI, says
Vince Chan, founder of
AlphaPowerMBA.com.
But rather than indicating that
MBAs have lost some of their shine,
the figures are reflective of a shift
from the number of applicants apply-
ing for two-year courses to one-year or
part-time courses. The GMAC report
found that 68 to 82 per cent of special-
ty MBA programmes for 2012 admit-
ting classes mainly masters in
management, accounting or finance
reported steady to increased applica-
tion volume compared with 2011. In
the UK, where the accredited full-time
one year MBA is predominant, the
more noteworthy shift has been from
full-time to part-time and distance
learning MBA programmes.
Most business schools today offer a
variety of MBA options, including
part-time, full-time, executive, flexi-
ble, and distance learning. Indeed,
Murgatroyd says that enrolments on
part-time MBA programmes at UK
business schools accredited by AMBA
Annabel Palmer on
why the traditional
programme may be
losing its popularity
Manchester Business School
Full and Part-time MBAs
Original Thinking Applied
The Manchester MBA will enhance your global network; youll work as a consultant
on live business projects with global companies; youll study at our centres in Dubai,
Singapore, Shanghai, Hong Kong, Miami or Sao Paulo; and youll learn from business
leaders and our academics - global leaders in their own right.
Apply now - the next application deadline is 3rd December for our full and
part-time MBA programmes.
To nd out more, visit go.mbs.ac.uk/mba or call + 44 (0) 161 275 7212
Think where an
MBA could take you
MBA candidates are
moving against the
conventional grain
24
BUSINESSEDUCATION
THURSDAY 22 NOVEMBER 2012
increased by 16 per cent in 2011. This
comes at a time when people are
reluctant to leave their job for study.
Where possible, they will opt to com-
plete an MBA while continuing their
full-time job.
LOW HANGING FRUIT
Fewer funding options means the one-
year course is looking increasingly
attractive. Shorter programmes mean
students are only taking one-year out
of work, thus reducing their loss of
earnings and enabling them to get
back into the workplace sooner. These
programmes also limit the other neg-
ative effects of spending time out of
employment. Richard Burns at
TopMBA.com says that although
MBA programmes are often vocation-
al in nature, for specific industries
taking a prolonged period of time out
of the working world could result in a
greater learning curve.
A key downside to the one-year
course is that it is impossible to
include the entire content of a two-
year MBA course in one year, accord-
ing to TopMBA.com. One year courses
are usually far more intense, and
therefore enrolled students are often
more advanced in their careers with
a typical five years minimum work-
ing experience. So for those with less
work experience, the two-year course
could be more fitting.
GOING FOR SPECIFICS
The other fundamental cause for the
decline in applications is the move
away from the broader MBA to more
specific courses. A 2012 survey under-
taken by AMBA asked 200 leading
business school deans and directors
whether they predict that the MBA
will increasingly specialise over the
next five years: 64 per cent of respon-
dents believed it will.
Candidates who are older and more
advanced in their careers may choose
one of the many programmes that
offer specialisations, electives or even
core modules that enable students to
focus on a specific industry while also
experiencing the traditional MBA
experience, says Burns.
A more focused specialty degree,
which enhances and builds upon
existing skills, can be far more effi-
cient in opening doors to specific
knowledge and networks than a gen-
eral management MBA, says Chan.
This gives it a higher or at least a
safer ROI amid uncertain business
environments.
CHANGING TACK
The profile of MBA applicants also
appears to be evolving. The GMAC sur-
vey found that, while men continue to
represent the largest number of appli-
cants, in 2012 a greater percentage of
MBA programmes increased applica-
tion volume from women compared
with 2011.
In addition, a TopMBA.com survey
found that globally, the average age of
MBA applicants rose from 27.6 in 2011
to 28.3 in 2012. In Western Europe the
rise was even more significant, with
the average age increasing from 28.1
to 29.6.
Business schools are generally recep-
tive to younger candidates, although
they must have a solid track record of
leadership experience and outstand-
ing personal qualities, says Chan.
COUNTING THE COST
The cost of an MBA can be over
50,000 per year, plus living expenses,
plus the loss of salary from taking
time out of work. The combination of
funding channels (like bank loans)
drying up and high competition for
scholarships may deter potential can-
didates.
There is a pecking order of business
schools, and students will often find
themselves paying a premium to
attend one of the more highly regard-
ed courses. Tuition fees at London
Business School, for example, are
57,500. But its alumni will, on aver-
age, see a 134 per cent salary increase.
Smaller and less globally renowned
schools, such as Birmingham Business
School, have lower tuition fees
19,000 but a slightly less impressive
87 per cent salary increase.
TOPLINE DELIVERABLES
That is why potential MBA applicants
need to consider a wide variety of fac-
tors before taking the plunge. Long-
term career goals, mode of study and
location are all important considera-
tions, as well as whether it will be
worth the time and cost. As Burns
asserts, an MBA degree isnt a magic
ticket to success the students and
graduates will still need to work hard
to achieve their career goals. But an
MBA will give students a wide breadth
of invaluable knowledge, equipping
them with career skills in investment,
accounting, finance, strategy and
marketing, among others.
THE GOLDEN TICKET?
From a recruiters perspective, an
MBA can be invaluable to boosting
your career. Nicola Linketer, manag-
ing director at Badenoch & Clark says
that an MBA will provide its students
with the key commercial and strate-
gic acumen that many top blue chips,
banks, consultancies and, increasing-
ly law firms are urgently looking for
in junior to mid-level candidates. It
could be the centrepiece of a candi-
dates CV.
Indeed, the GMAC Alumi
Perspectives Survey found that based
on 4,135 alumni worldwide 86 per
cent of 2011 graduates were employed
after graduation, with three-quarters
claiming they could not have
obtained their job without their MBA.
25
cityam.com
THURSDAY 22 NOVEMBER 2012
GLOBAL MBA RANKINGS 2012
Rank 2012 3 yr Rank School name Country Weighted sal $ Salary inc %
1 3 Stanford Graduate School of Business US 192,179 129
2 3 Harvard Business School US 178,249 122
3 2 University of Pennsylvania: Wharton US 172,353 120
4 2 London Business School UK 152,981 134
5 6 Columbia Business School US 166,497 131
6 5 Insead France/Singapore 144,355 97
7 8 MIT: Sloan US 157,337 120
8 7 IE Business School Spain 156,658 139
9 10 IESE Business School Spain 13,888 148
10 8 Hong Kong UST Business School China 127,600 144
Shorter courses
mean students spend
less time and invest
less money upfront

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TV & GAMES
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BBC1
SKY SPORTS 1
7pmFIFA Futbol Mundial 7.30pm
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Rugby Club 9pmRingside 10pm
The Footballers Football Show
11.30pmRingside 12.30am
Premier League World 1amThe
Footballers Football Show2.30am
The Rugby Club 3.30am-6amLive
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SKY SPORTS 2
5.30pmLive NFL 9.15pmLive NFL
1.15amLive NFL 4.30am-5am
Sky Sports Classics
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11.55pm-6amLive Test Cricket
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Fill the grid so that each
block adds up to the total
in the box above or to the
left of it.
You can only use the
digits1-9 and you must not
use the same digit twice in
a block. The same digit may
occur more than once in a
row or column, but it must
be in a separate block.
COFFEE BREAK
Using only the letters in the Wordwheel, you have
ten minutes to nd as many words as possible,
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters
or more, all must contain the central letter and
letters can only be used once in every word. There
is at least one nine-letter word in the wheel.
Place the numbers from 1 to 9 in each empty cell so that
each row, each column and each 3x3 block contains all the
numbers from 1 to 9 to solve this tricky Sudoku puzzle.
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
KAKURO
QUICK CROSSWORD
LAST ISSUES
SOLUTIONS
KAKURO
WORDWHEEL
SUDOKU
SUDOKU
QUICK CROSSWORD
WORDWHEEL
1 2 3 4 5
6
7
8 9
10 11 12
13 14
15 16 17
18 19
20
21
22
12 11 14
45
9 29
16 24
27 8
13 20
14 10
38 5
23 21
45
4 17 12
30
23
5
14
37
9
7
6
17
36
15
34
42
6
16
9
15
22
11
11
24
28
ACROSS
1 Noise made by a
mouse, for example (6)
6 African antelope
with ridged curved
horns (6)
7 Precious red
gemstones (6)
8 Gunk, slime (6)
10 Stonecutter (5)
13 Cleft (7)
16 Detection and
location device (5)
18 Smear with
ointment (6)
20 Enthusiastic and
warm in manner (6)
21 Order of business (6)
22 Makes a logical
connection (4,2)
DOWN
1 Plasma (5)
2 News chief (6)
3 Osculate (4)
4 Encrusted with
sugar (7)
5 Light-beam
intensier (5)
9 Animals den (4)
11 Childs two-
wheeled vehicle
operated by
foot (7)
12 Gas used in
lighting (4)
14 Decanter (6)
15 Apostolic (5)
17 Synthetic fabric (5)
19 Not this! (4)
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B R A C E S T L
I F A L W A Y S
S T R U C K O R
T E A I R S H I P
R I S E R T C
O H A T C H E T S
B R O P I U M
T A C T I C S T A
S H H E A T E R
F R I E Z E E T
A N W A L R U S
5 2 3 1 3 4 2 1
8 5 7 2 4 6 9 1 3
7 9 3 7 9 8
9 8 7 6 8 7 6 9
6 1 2 1 5 1 6
3 1 4 2 7 6 5
1 4 9 3 9 8 4
3 7 9 8 1 8 4 2
1 3 8 2 3 1
8 1 4 6 9 5 7 2 3
9 2 8 7 8 9 7 5
4
4
4
4
4
4
4
4
4
The nine-letter word was
CUSTOMARY
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BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5
THURSDAY 22 NOVEMBER 2012
HUNTED
BBC1, 9PM
Sam is exposed as a spy following a
failed attempt to kill Jack Turner, and
she begins to recall the truth about
why Hourglass wants her dead.
EMMERDALE
ITV1, 8PM
Declan tries to rescue Katie from the
mine shaft, and Brett is happy to give
Edna advice about Tootsie, leaving
Paddy annoyed.
HATFIELDS & MCCOYS
CHANNEL5, 9PM
The two clans come face to face in a
gunfight at Grapevine Creek. Fact-
based drama, starring Kevin Costner
and Bill Paxton.
TVPICK
Would you trust this
Terminator to kill at will?
THURSDAY 22 NOVEMBER 2012
cityam.com
28
LIFE&STYLETECHNOLOGY
GEEK
SPEAK
STEVE DINNEEN
Tablets that dont cost the earth
Want a tablet but dont want to fork out 269 for an iPad Mini? There are other options, says Steve Dinneen
AMAZON KINDLE FIRE HD
Amazon.co.uk, 129 (seven inch)
THE KINDLE Fire was hailed as the
first serious challenger to Apples
domination of the tablet market
a colour e-reader with access to
the web that seamlessly integrated
with your Amazon account.
In reality it was too heavy and too
ugly to ever set the tablet world on
fire. The Kindle Fire HD is its slim-
mer, more handsome brother.
While it is still very plasticky
what with being made of plastic
and all it feels like a far better
designed product. Dont get me
wrong, its no rival to the iPad
Minis delicious good looks but it
didnt make me gag in disgust,
either.
The unit is marginally squatter
than the iPad Mini, but you get far
less screen for your buck, with the
bevel taking up a huge amount of
real-estate.
Getting started with it wasnt the
smoothest of processes, with the
device flat-out refusing to connect
to the office wi-fi. BT Openzone to
the rescue. Once youre connected,
though, its actually a lot of fun.
The OS is built on top of Android
but Amazon has almost complete-
ly masked it with its own tweaks,
making it far more intuitive and
pleasant to use than most Android
tablets.
The best bit, as youd expect, is
the integration with your Amazon
account, meaning that, almost out
of the box, it is fully almost creep-
ily aware of your tastes and view-
ing history.
Head to head, it comes a distant
second to the iPad but, crucially, it
is also less than half the price.
VODAFONE SMART TAB II
Vodafone.co.uk, 149 (pay as you go)
The Smart Tab II, appropriately for
a tablet made by Vodafone, looks
like a giant phone. If Dom Jolly had
upgraded to a smartphone, this
would be it. Its not an unattractive
device (apart from the golf ball-style
dimples on the rear) but neither
does it bring anything new to the
table.
The seven inch device does every-
thing you expect of an Android
tablet: syncs with your email
account, connects to the web but
is singularly joyless. Then screen is
muddy, the resolution grainy and
load times can be painfully slow. It
has a mobile connection (obviously)
but if youre planning for the
future then its not for you it is
only 3G enabled, so no superfast
internet. All in all: a bit of a dud.
S
HOULD robots be allowed to
kill people? Its a question
anyone who has seen
Terminator 2 shouldnt have to
think about for long. Killer robots
are not, science fiction has taught
us, a very good idea. Give a robot a
gun and a modicum of intelligence
and it wont be long before it is
scheming to take control of the
world and enslave its fleshy creators.
In light of this, Human Rights
Watch (HRW) has called for a pre-
emptive treaty to be signed banning
the use of weapons that can
autonomously seek out human
targets and, well, terminate them.
Unmanned drones are already
widely used by governments
including our own but, crucially,
they still need to ask the permission
of a human being before dropping
their deadly payload. But within 20-
30 years the point at which many
scientists believe computers will
overtake humans in terms of
intelligence HRW says weapons
will be advanced enough to identify
targets, work out whether they pose
a threat and pull the trigger all by
themselves.
All the usual suspects are involved
in developing them, according to the
report, including China, the US,
Germany, Israel, South Korea, Russia
and, of course, us.
Is it a good idea? Well, while
science fiction has already asked
the question, it has also provided
the answer, in the form of Isaac
Asimovs three rules of robotics,
which he laid down in 1942:
1. A robot may not injure a
human being or, through inaction,
allow a human being to come to
harm.
2. A robot must obey the orders
given to it by human beings, except
where such orders would conflict
with the first law.
3. A robot must protect its own
existence as long as such protection
does not conflict with the first or
second laws.
All very sensible, although still
completely useless when the super-
intelligent machines of the
future decide they no longer
want to spend their time
assembling cars and dispensing
cans of Coke. As soon as
Skynet or whatever we decide
to call the software that will
bring about our downfall
becomes self-aware, our days will
be numbered. The sentient robot
will be the first link in the
evolutionary chain that has
been purposefully created by
its hapless forbears. In fact,
this is probably a good time
to point out that, when the
time comes, I will be first in
line to pledge allegiance to
our new robotic overlords.
The Kindle Fire HD (above)
is a decent device for
Amazon addicts but the
Vodafone Smart Tab (left)
leaves a lot to be desired.
Terminator 2 has shown us why robots should not kill
SOUTH Africa coach Heyneke
Meyer believes England are now
tough enough to compete with the
brutality of the southern
hemisphere sides, ahead of their
clash at Twickenham on Saturday.
Meyer, who spent six months as
Leicester boss in 2008, admits he
used to view England teams as soft
but his preconceptions were
changed by a spell with the Tigers.
Lewis Moody and Martin Corry
and those guys are probably the
toughest guys I have coached. My
whole perception changed. Itll be a
bruising encounter, said Meyer,
who has named an unchanged side.
England have not beaten the
Springboks in their previous 10
Tests, a run going back to 2006.
The last three Tests [in the
summer] were really physical and
that was at the end of their season.
Now theyre fresh and we need to
toughen up and put our bodies on
the line, he added. I have a lot of
respect for their scrummaging
power. Dan Cole is close to being
the best tighthead in the world.
The 45-year-old is concerned his
squad are struggling mentally after
a long campaign. I need one more
great performance out of them, he
said. They always lift themselves
for England but I am worried.
Meyer wary of
ferocious test
for tiring Boks
CHELSEA last night turned to former
Liverpool manager Rafael Benitez
and Blues favourite Didier Drogba to
save their crumbling season, after
sacking European Cup winner
Roberto Di Matteo.
Benitez has been appointed inter-
im first team manager until the end
of the season, after flying in from
Abu Dhabi yesterday to tie up the
shock move, and will meet the squad
for the first time this morning.
Blues owner Roman Abramovich
had Di Matteo, who won the FA Cup
and a historic Champions League in
his eight months in charge, fired in
the early hours after Tuesdays defeat
in Juventus marked a new low point
in their season.
The owner and the board believe
that in Benitez we have a manager
with significant experience at the
highest level of football, who can
come in and immediately help deliv-
er our objectives, Chelsea said.
Abramovich wants former
Barcelona manager Pep Guardiola to
take charge long term, but he has
refused to consider any jobs until the
summer, when Chelsea will make
fresh attempts to lure him.
Benitez has been out of manage-
ment since Inter Milan cut short his
six-month tenure in December 2010,
having spent six years at Liverpool,
where he won the Champions
League in 2005. The former Valencia
coach is widely unpopular among
Chelsea supporters, having been in
charge of the Reds during a period of
intense rivalry between them and
the west Londoners.
Liverpool dispensed with Benitez
after four barren seasons culminated
in a seventh-place finish in the
Premier League, while Inter sacked
him following a disappointing start
to the season. He recruited Fernando
Chelsea risk wrath of fans
with Benitez appointment
Torres to Anfield, and Abramovich
will hope that reuniting the pair will
help Chelseas record 50m signing
rediscover the blistering form he
showed on Merseyside. Torres has
flattered to deceive since arriving at
Stamford Bridge almost two years
ago, and has managed just one goal
in his last eight games, prompting Di
Matteo to drop him against Juventus.
Chelsea hope to ease the burden on
the 28-year-old by taking their former
talisman Drogba on loan next month
from Chinese side Shanghai
Shenhua, six months after letting
him leave for free. The 34-year-old is
available in December, following the
end of the Chinese Super League and
before the Africa Cup of Nations, and
has applied to world governing body
Fifa for special dispensation to move
outside the transfer window.
Chelsea have fallen four points
behind leaders Manchester City, who
they face on Sunday. In Europe they
must beat Nordsjaelland in their
final group match and hope Juventus
lose at Shakhtar in order to avoid
becoming the first holders to be elim-
inated at the group stage.
FOOTBALL
COMMENT
TREVOR STEVEN
Benitez is unpopular with Chelsea fans following his lenghty spell as Liverpool boss, while Drogba could be on his way back to the club
THURSDAY 22 NOVEMBER 2012
30
SPORT
cityam.com/sport
BY ALEX SHARP
BATSMAN Jonathan Trott admits he
is relieved that he can immediately
get back to the crease and help
England respond after a heavy first
Test defeat against India.
The tourists stumbled to a nine-
wicket loss in Ahmedabad on
Monday, despite captain Alastair
Cooks fine second-innings 176, as
the batting middle order collapsed
in both sessions.
Trott is grateful there are only
four days between the disappointing
first Test and the second, which
starts tomorrow in Mumbai.
You wouldnt want a week or
eight days mulling over the game;
you want to get back out there and
batting and crack on, said Trott.
Englands No3 only hit 17 runs
over two innings during the first of a
four-match series.
He added: Travelling to Kolkata
1-1 [for the third Test] would be
great. We understand the challenge
for us in these three games, but we
know we can do it.
The 31-year-old believes the pitch
in Mumbai will better suit the seam
bowlers, who only combined to take
one wicket in the first match. He
said: Ahmedabad was quite low and
slow. We hope our seam bowlers can
exploit that, a little bit more bounce
for spin and seam and obviously a
little bit more turn as well.
Trott itching
to find form
in the middle
BY ALEX SHARP
BY FRANK DALLERES
Di Matteos sacking was
harsh but inevitable
@cityam_sport
I
N MOST football management
jobs, if you have five or six weeks
of poor results, youre in trouble. If
youre at Chelsea and in freefall, as
Roberto Di Matteo was, you know
what comes next.
The club are all about getting
results, here and now. They are also
one of the most ambitious in the
world thats why they continuously
attract the best players and
managers on the planet.
Last season could scarcely have
ended better, with an FA Cup and a
first Champions League title,
although I dont think anyone would
argue that they enjoyed great
fortune along the way.
But when you win the European
Cup its critical that you capitalise
on that position, especially if you
aim as high as Chelsea. Going out of
the competition at the first hurdle
isnt capitalising.
Whoever sanctioned Didier
Drogbas departure has a lot to
answer for. If it was Di Matteo, he
deserves to go; if it was the money
men, they left the Italian in a very
difficult position.
Harsh though it may seem, his
treatment goes with the territory
and his sacking was inevitable in
many ways. Di Matteo never looked
like a long-term appointment; now
his successor might be a stop-gap too.
Why Blues owner Roman
Abramovich appears to think Rafael
Benitez is the man for that role is
beyond me, though. The ex-Liverpool
boss is the type for a five-year plan,
hes not a firefighter.
I can see why the Spaniard might
be interested. Hes dangerously close
to having been out of the game for
too long, and a spell at a top club,
even if short-lived, puts him
back in the shop window.
But if Abramovich thinks
reuniting Benitez with his
old Anfield pupil Fernando
Torres can coax the 50m
striker back to top
form I think he is in
for a nasty
surprise. The
malaise
afflicting Torres
looks
incurable.
All-
conquering
former
Barcelona
manager Pep
Guardiola is wanted in the long-
term, he appears to be interested,
and Chelsea are one of the few clubs
ambitious enough to lure him.
I cant see him coming mid-season
and going straight into regular
matches days later, however. He will
take until the end of he campaign to
weigh up his options, because he can
have almost any job he likes.
Abramovich can write Pep a blank
cheque, but Manchester City
and United look better fits,
with the players they have.
And if he snubs them,
Chelsea could be stuck
with Benitez.
Trevor Steven is a
former England
footballer who now
works as a media
commentator and scout.
ABRAMOVICH BOSSES
NAME YEAR WIN%
Guus Hiddink 2009 73
Jose Mourinho 2004-07 67
AvramGrant 2007-08 67
Carlo Ancelotti 2009-11 61
Roberto Di Matteo 2012 57
Luiz Felipe Scolari 2008-09 56
Claudio Ranieri 2000-04 54
Andre Villas-Boas 2011-12 48
Rafas for five-year plans, not firefighting
31
IN BRIEF
Ex-champ Camacho shot in face
nBOXING: Puerto Rican former world
champion Hector Camacho was last
night fighting for his life after being
shot in the face. The 50-year-old, who
retired in 1997, was injured in a drive-
by attack in San Juan on Tuesday and
suffered a heart attack in hospital.
AVB wont risk Dembele in Italy
nFOOTBALL: Tottenham manager
Andre Villas-Boas insists midfielder
Mousa Dembele will not play at Lazio
in tonights Europa League clash,
despite the Belgian recovering from a
hip injury to travel with the squad.
Trescothick pens Somerset deal
nCRICKET: Former England batsman
Marcus Trescothick has signed a three-
year contract extension at Somerset.
He has twice helped them finish
second in the County Championship.
Jockey Frankie Dettori has been suspended
by French racing chiefs until his case for failing
a drug test is resolved in the next fortnight
cityam.com
THURSDAY 22 NOVEMBER 2012
Buy online at
fulhamfc.com
or call 0843 208 1234
(option 1)
Newcastle, Southampton and Swansea tickets are on General Sale. Tottenhamtickets are currently on sale to supporters with a Booking History.
All tickets are subject to availability, terms and conditions apply.
FULHAM FOOTBALL CLUB, CRAVEN COTTAGE
Wed 26th Dec Sat 29th Dec Sat 1st Dec Mon 10th Dec
Limited
Availability
Results
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Euro exit wont cost me job, says Mancini
Wenger not satisified
after Wilshere sends
Gunners into last 16
MANCHESTER CITY......................1
REAL MADRID.............................1
BY ALEX SHARP
CHAMPIONS LEAGUE
ARSENAL....................................2
MONTPELLIER............................0
BY FRANK DALLERES
CHAMPIONS LEAGUE
MANCHESTER City manager
Roberto Mancini does not fear the
sack despite his side crashing out
of the Champions League in the
group stages last night for a
second successive season.
Sergio Agueros second-half
penalty cancelled out Karim
Benzemas early tap-in but a draw
was not enough for City.
I dont have fear for this, said
Mancini when asked about his job
security. If we think we can win a
Champions League after two years
then we are crazy.
The Italian blamed elimination
on earlier slip-ups in matches at
Real and Ajax.
We didnt lose it tonight, we
ARSENAL boss Arsene Wenger
insists he will go all out to claim
first place in Group B after seeing
his side ensure passage to the
Champions League knockout stage
for the 13th successive season.
Midfielder Jack Wilsheres first
goal for almost two years and a
blistering volley from forward Lukas
Podolski earned a comfortable
victory, but Schalkes three points
against Olympiacos kept them top.
To pip the Germans Arsenal must
win in Greece and hope Schalke do
not beat Montpellier and Wenger
has vowed to resist the temptation
to rest stars and send his strongest
squad in the hope of doing so.
We will play to win, to finish top
of the group, said Wenger, who
lauded fit-again Wilsheres
improving contribution. I am
pleased for Wilshere, its great to
see him getting stronger.
Wilshere netted in the 49th
minute, when Thomas Vermaelens
cross was headed down by Olivier
Giroud and the midfielder, who
returned from an 18-month injury
in October, nimbly lifted over
goalkeeper Geoffrey Jourdren.
In-form striker Giroud also
provided the second on 63 minutes,
returning a pass from Podolski with
a nonchalant chip that the German
despatched first time into the roof
of the net with a thunderous volley.
lost in the first few games, he
added. In Madrid we were 2-1 up
with five minutes to go; in
Amsterdam we were 1-0 ahead and
missed chances to close the game.
Mancini was punished for
deploying a three-man defence as
Real had multiple chances to kill
off the game in the opening half.
Aguero was guilty of wasting
great opportunities, particularly
at point blank range firing
straight at Iker Casillas.
Aguero redeemed himself on 73
minutes from the spot after Alvaro
Arbeloa was perhaps harshly sent
off. The hosts poured forward but
could not find the crucial winner.
B Dortmund 5 3 2 0 10 5 11
Real Madrid 5 2 2 1 11 8 8
Ajax 5 1 1 3 7 12 4
Man City 5 0 3 2 7 10 3
GROUP D
TEAM PLD W D L F A PTS
Schalke 5 3 2 0 9 5 11
Arsenal 5 3 1 1 9 6 10
Olympiacos 5 2 0 3 7 8 6
Montpellier 5 0 1 4 5 11 1
GROUP B
TEAM PLD W D L F A PTS
Wilshere opened the scoring for Arsenal with his first goal for almost two years

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