Académique Documents
Professionnel Documents
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EU PRESIDENT:
SURVIVAL OF
EURO AT RISK
WORLD ECONOMY
▲
International Monetary Fund, but by saying that the insolvency crisis was
BY JULIET SAMUEL there is also the possibility of bilateral in Ireland’s banking sector, not its pub-
loans from the UK, due to Britain’s lic finances.
A FRESH round of misery spread heavy reliance on trade with Ireland. However, the government has prom-
through Europe yesterday as Ireland’s Chancellor George Osborne yesterday ised to guarantee all Irish bank debt. In
continued insistence that it does not said he did not want to add to specula- response to Cowen, the yield on Irish
need a bailout sent stocks plunging on tion by commenting. ten-year bonds jumped back over 8.2
both sides of the Atlantic. The latest shocks came as the Irish per cent and opposition leader Eamon
The FTSE 100 recorded its biggest government yesterday disappointed Gilmore said: “I’m not quite sure why
drop since August, falling 1.5 per cent markets by clearing its parliamentary you made this statement today.”
yesterday to close at 5,690. The Dax schedule for a special statement and As fears grew that the Irish situation
dropped 1.2 per cent to close at 6,672 then failing to announce any measures is becoming a European contagion,
and the Eurostoxx 50 slipped 0.4 per to deal with its spiralling debt crisis. ten-year Portuguese and Spanish gilt
cent to close at 2,810. In the US, the “What we are doing is discussing yields also rose yesterday, to 6.8 per
Dow Jones fell 1.6 per cent, to with our European partners as to what cent and 4.6 per cent respectively.
11,023.50 – its lowest level in a month. stabilisation (measures are)... neces- Investors have now begun to ques-
Eurozone finance ministers will sary,” Prime Minister Brian Cowen tion whether Portugal could be next.
today meet for a second day of talks, said. He also tried to deflect pressure Its government was yesterday forced to
with the likelihood of an Irish bailout deny that, like Germany, it has been
at the top of the agenda. pressuring Ireland to accept a bailout
EU President Herman Van Rompuy German chancel- in order to calm the markets and save
yesterday spooked investors by saying lor Angela Merkel itself from a similar fate. The cost of
that the crisis was a matter of “sur- is being blamed by Greek debt also rose as Austrian
vival” for the EU’s institutions. He said: finance minister Josef Proell said that
“If we don’t survive with the some for exacer- Austria would withhold its €190m con-
Eurozone, we will not survive with the bating the crisis for tribution to the country’s rescue pack- A ROYAL wedding between prince William and his fiance Kate Middleton could come
European Union.” her blunt remarks age until Greece fulfilled its promise as early as spring next year, after the pair announced yesterday that they are to tie the
Funding for a bailout is most likely on sovereign debt. to get its deficit down to 8.1 per cent of knot. Prince William proposed whilst on a holiday in Kenya last month, and used the
to come both from the EU and the GDP for this year. IRELAND FOCUS: P2 engagement ring his father gave to his mother, Princess Diana, in 1981. Picture: PA
BANKING
BY RICHARD PARTINGTON tres of London, Hong Kong and New political tension and negative public- from the bank to provide top to take a more sustainable approach
York, will take immediate effect. ity over large bonuses, whilst simul- bankers with high bonuses. Senior to pay.
SENIOR bankers at HSBC are to have The move comes as Treasury min- taneously using the salary hike to staff have seen their personal cash- HSBC had just two weeks ago com-
their salaries doubled, as the bank ister Mark Hoban urged banks to placate bankers. flow squeezed, as annual bonuses plained about new bonus rules,
attempts to head off a bonus row “think very carefully” about the The measures ensure the bank have been deferred for several years, which it said could force it to consid-
amid political pressure. upcoming round of bonuses, as the remains a competitive employer for or have been paid in share options. er moving its London headquarters
The 100 per cent rise for hundreds government seeks to quash extrava- top City workers, as many of its The rebalancing of remuneration overseas.
of top bankers across HSBC’s global gant City rewards during a period of rivals, including RBS, have upped away from variable pay toward fixed HSBC last night declined to com-
banking and markets (GBM) opera- public austerity. salaries over the past two years. salaries will also be welcomed by reg- ment.
FTSE 100 ▼ 5,681.9 -138.51 DOW ▼11,023.5 -178.47 NASDAQ ▼ 2,469.84 -43.98 £/$ 1.59 ▼-0.01 £/¤ 1.18 unc ¤/$ ▼1.35 -0.01 Certified Distribution
04/10/10 - 31/10/10 is 110,406
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2 News CITYA.M. 17 NOVEMBER 2010
?
Tel: 020 7015 1200 Fax: 020 7283 5334 TIME LINE | IRISH DEBT CRISIS Q & A : THE IRISH BAILOUT
Email: news@cityam.com www.cityam.com
Editorial ● May 2008 2010-2011 and forecasts additional
Editor
Deputy Editor
Allister Heath
David Hellier
Brian Cowen is elected Irish prime minis-
ter. His allies and opponents warn he
€3.25bn from taxation in that period in
emergency budget, the second in six Q. WHAT HAPPENS NOW? alternative to a sovereign
bailout could be a bailout of
News Editor
Night Editor
Associate Editor
Ben Griffiths
Katie Hope
David Crow
faces a tough task steering the country
through economic slowdown.
months. Fitch also strips Ireland of its top
AAA credit rating, reducing it to AA-plus. A. The timeline is highly uncertain,
which is in part what has fuelled
market turmoil. Ireland is still deny-
the banking sector, whose
debts the government has
guaranteed. However, most EU states
Business Features Editor Marc Sidwell ing that it is in need of a bailout, but would be reluctant to lend without
● September 2008 ● August 2010 many observers expect a capitulation channelling the money through the
Lifestyle Editor Zoe Strimpel Ireland becomes the first euro zone Standard & Poor's cuts Ireland's long-
Pictures Alex Ridley within the week. A major point of Irish government and subjecting it
country to slip into recession after its term rating by one notch to 'AA-' and interest will be the close of Eurozone to strict conditions.
Commercial property bubble bursts. assigns the country a negative outlook. finance minister negotiations today,
Sales Director
Commercial Director
Jeremy Slattery
Harry Owen ● December 2008
Ireland agrees to inject €5.5bn (£4.6bn)
● September 2010
with expectations that the talks
could provide a framework for Q. WHAT CONDITIONS WOULD AID
CARRY?
Head of Distribution Nick Owen
into its three main banks, taking Anglo
Irish Bank under its control.
Ireland discloses worst case price tag of
over €50bn (£42bn) for bailing out its
banks and announces it will have to make
bailouts and suggest some general
conditions for aid money in the
future. In addition, Ireland is meant
A. The EU could insist Dublin
reneges on an agreement with
public sector unions not to cut jobs
Distribution helpline to be outlining a four-year plan for or push through further wage cuts.
If you have any comments about the distribution more budget savings.
of City A.M. Please ring 0207 015 1230, or email ● March 2009 getting its deficit under control in Brussels may also demand Ireland
distribution@cityam.com Standard & Poor's downgrades Ireland's ● November 2010 the next two weeks. Much will raises its corporation tax rate, viewed
depend on the credibility of the plan. as sacrosanct by Dublin, from its cur-
Editorial Statement credit rating from prized AAA ranking to EU Economics Commissioner Olli Rehn, rent low level of 12.5 per cent.
AA+ and warns it could drop further, in a visits Ireland and says he has not dis-
This newspaper adheres to the system of
self-regulation overseen by the Press Complaints vote of no-confidence in Dublin's efforts
to get its public finances under control.
cussed any need for EU bailout, adding he
believes market confidence would be
Q. CAN IRELAND AVOID A
BAILOUT?
Q. WHY IS IRELAND NOT KEEN ON
Commission. The PCC takes complaints about the
editorial content of publications under the Editor’s
Code of Practice, a copy of which can be found at
www.pcc.org.uk ● April 2009
restored once the country published its
four-year plan to cut debt, which is set
A. It is looking increasingly unlike-
ly, although the Irish govern-
ment is likely to continue to offer A.
EU HELP?
An EU bailout would mean a big
loss of face fiercely proud of its
Printed by Newsfax International,
Irish finance minister Brian Lenihan out- for release before a 25 November by- strong resistance due to the unpopu- independence. It would also mean
Beam Reach 5 Business Park, lines €10.6bn (£9bn) in spending cuts for election. larity of submitting to the conditions significant international interfer-
Marsh Way, Rainham, Essex, RM13 8RS of any aid package. One possible ence in sovereign affairs.
UK to oppose
Glaxo’s lupus EU-funded
drug cleared rating agency
▲
POLITICS
BY DAVID CROW
PHARMACEUTICALS studies has produced consistent spec- CRA to boost competition in a sector
BY KATIE HOPE ulation that Glaxo would acquire that is dominated by three big players:
Human Genome. Moody’s, S&P and Fitch.
AN ADVISORY panel for the US Food There have been no new treat- BT Group chief executive Ian Livingston could pursue a legal challenge Picture: REUTERS He said the agency might need to be
and Drug Administration (FDA) last ments in the last few decades for funded at least in part by public
unprofitable biotech firm Human ANALYSIS l GlaxoSmithKline BY RICHARD PARTINGTON could pursue a legal challenge. money in establishing a new CRA.
1,320 p
Genome and Glaxo. 1,213.50 Companies in other sectors are He said: “Credit rating agencies
The FDA, which should make a 16 Nov TELECOMS giant BT has warned it allowed to raise wholesale charges to must have a sound business model
decision by early December, isn’t 1,280 could sue regulator Ofcom, after it rivals in order to address pension that doesn’t depend on money from
required to follow the advice of its refused to allow a rise in wholesale deficits, including in the gas and elec- the EU.”
panels, but usually does. fees to rivals to help repair BT’s oner- tricity market. Chuka Umanna, a Labour member
Benlysta is important for both com- 1,240 ous pension deficit. Worries over BT’s pension pot were of the Treasury select committee, said
panies as it’s one of the most impor- An interim ruling in July by the raised by the Pensions Regulator in Hoban was wrong to dismiss the idea.
tant new drugs in Glaxo’s pipeline regulator denied BT the opportunity February over the company’s plans to “It’s extraordinary to think that tax-
1,200
and Human Genome has no products to raise charges on its Openreach remedy its deficit, which stood at payers wouldn’t want a more compet-
on the market. business, the subsidiary used by rivals £9bn, according to a December 2008 itive CRA market. A new agency might
16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
The drug’s success in two large to access BT’s network. If confirmed actuarial valuation. need public money to get started”.
CITYA.M. 17 NOVEMBER 2010 News 5
▲
MINING
BY HARRY BANKS city of Perth. “No pain, no gain.” would turn to smaller deals because
Nasser was speaking a day after it is too big to win regulatory
GLOBAL miner BHP Billiton is still BHP withdrew a $39bn bid for top fer- approval for major takeovers, and
interested in big acquisitions and tiliser maker Potash Corp after said top quality acquisitions were still
does not regret spending $875m pur- Canada blocked the offer. available although he declined to
suing three major deals that col- BHP scrapped an iron ore joint ven- name any. “Don’t look to us to be
lapsed in the past two years, its ture with rival Rio Tinto a month ago chasing smaller acquisitions of lower
chairman said yesterday. after running into competition con- quality,” he said. Shareholders have
“For me, the juice is worth the cerns in Europe, Australia and Asia. It continued to back chief executive
squeeze on every one of those,” Jac also abandoned a full takeover of Rio Marius Kloppers, at the helm during
Nasser said after BHP’s annual share- Tinto in 2008. all three failed acquisitions.
GM chief exec Dan Akerson has helped turnaround the firm’s fortunes Picture: REUTERS
GM ups stock
offer by 30pc
pushed it into a bankruptcy funded
▲
AUTOMOTIVE
BY HARRY BANKS by the Obama administration.
GM plans to sell 478m common
GENERAL Motors (GM) is boosting the shares for $32 to $33 each, raising
size of its common stock offering by about $15.5bn at the mid-point.
more than 30 per cent to $15.5bn, GM earlier yesterday increased the
potentially making its landmark IPO size of its preferred stock offering by
the largest US offering ever. $1bn to $4bn in a move that will
The expansion is in response to strengthen its balance sheet by pay-
surging demand from investors, who ing down pension debt – one of the
had put in orders worth $70bn for concerns investors had cited heading
GM’s common shares by late on yes- into the IPO.
terday. Including an overallotment provi-
GM’s initial public offering, which sion for both common and preferred
will reduce the US Treasury to a shares, the GM deal is now set to raise
minority shareholder in the top US about $22.7bn n if it prices at the
automaker, could raise nearly $23bn high end of the new price range.
if underwriters exercise the full over- The final terms for GM’s IPO are
allotment option. The largest US IPO expected today. The stock is set to
so far is Visa’s $19.7bn stock sale in begin trading on the New York and
2008. The increased size of the IPO Toronto stock exchanges on Thursday.
reflects renewed investor confidence GM, which lost $88bn from 2005 to
in the world’s second largest its 2009 bankruptcy, earned a $4.1bn
automaker less than a year and a half net profit in the first nine months of
after dwindling cash and falling sales the year.
FINANCIAL SERVICES
new business division, which opens
CROSSBRIDGE Capital, a London today. The plans mark a significant
wealth manager set up by former strategic move for the company, part
Credit Suisse bankers, has joined the owned by Swiss bank Julius Baer,
chase for Asia’s tycoons and set up a beyond its established Middle
Singapore unit seeking $1bn of new Eastern, London-focused client base.
assets, its chief executive said. Crossbridge currently manages
Chief executive Tarek Khlat said about $2bn in assets from its London
yesterday that Crossbridge hoped to base, with an average account size of
reach the target, a 50 per cent $20m. It is seeking 50 new client rela-
increase in assets under manage- tionships to hit its target.
6 News CITYA.M. 17 NOVEMBER 2010
UBS following
new tax rules
investor presentation in London.
▲
BANKING
“We believe that SwFr15-40bn are
BY MATTHEW WEST still at risk as a result of changes in
UBS could lose about 10 per cent of tax regulations,” said Juerg Zeltner,
its European client assets as a result head of UBS wealth management,
of deals Switzerland is striking with adding the bank had SwFr320bn
other countries over untaxed secret invested client assets in Europe at the
bank accounts. end of September.
The bank, which confirmed ambi-
tious medium-term goals yesterday,
said up to SwFr40bn (£26bn) were at
However, UBS said it remained on
track to reach an annual pre tax
profit of SwFr15bn by 2014 at the lat-
Modest rise in number of City roles in October
risk from changes in tax regulations. est, despite a shock third-quarter
Switzerland agreed last month investment banking loss due to low UK ECONOMY sionals were seeking new positions, adding it was unlikely there would be
▲
with Germany and Britain to resolve client activity after UBS cut risky but the report says. The average City salary a significant increase in hiring before
the issue of untaxed accounts and to potentially lucrative proprietary THE City’s financial services sector saw fell four per cent from £53,400 to Christmas.
impose a withholding tax on future trading. a five per cent rise in the number of £51,245.
deposits. It is expected to seal similar Investment bank head Carsten jobs created last month to 4,977, a sur- The modest rise in the number of ANALYSIS l New jobs vs new candidates
deals with other European nations Kengeter said UBS was well placed to vey will say today. jobs was attributed to the increase in 14,000
imminently. benefit from an upturn in client The Morgan McKinley London the UK’s GDP in September, as well as
12,000
UBS faces demands for clients’ activity after hiring new staff, Employment Monitor claims job avail- a notable increase in merger and
unpaid tax and the possibility of though trading growth would also ability also increased by 13 per cent acquisition (M&A) activity. 10,000
more clients withdrawing money mean more risk. year-on-year. But Andrew Evans at Morgan 8,000
from offshore accounts. Separately the Swiss government The number of professionals look- McKinley Financial Services warned 6,000
The bank said clients from Austria, said US tax authorities had with- ing for new roles in the City last hiring activity was slowing.
Britain, France, Germany and Italy drawn a summons against UBS after month decreased by 16 per cent to “Traditionally the fourth quarter 4,000
had already withdrawn SwFr20bn the bank was forced to hand over 9,100 from 10,850 in September. But sees a decline as managers focus their 2,000 new Jobs
new Candidates
from its accounts in the past 12 details of 4,000 accounts of clients this was a 26 per cent increase on the attention on the following year’s
months, according to slides in an suspected of tax evasion. same time last year when 7,210 profes- resource requirements,” he said, Nov 09 Feb 10 May 10 Aug 10
CITYA.M. 17 NOVEMBER 2010 News 7
The X Factor helped push ITV to revenue growth of 11 per cent Picture: REX
Cowell reigns
but ITV lacks
The X Factor
▲
POLITICS
BY DAVID CROW hour.
Law firms Allen & Overy, Freshfields
A RAFT of big-hitting City firms have Bruckhaus Deringer, Norton Rose and
agreed to pay their employees the Slaughter and May also signed up to
London Living Wage, as part of Boris the scheme, bringing the total num-
Johnson’s drive to push up wages for ber of participating companies to 115.
the low paid. Johnson said: “There is an army of
Investment banking giants UBS, workers... who keep this city function-
Bank of America Merrill Lynch and JP ing, and it is only right that they are
Morgan yesterday added their names rewarded with a wage that will help
to the growing list of firms promising keep them out of poverty.”
8 Economic News CITYA.M. 17 NOVEMBER 2010
King writes
to Osborne as
in
ease in VAT
s th e pros pective incr on is likely to remain
pect inflati
The MPC ex per cent will mean odity and
20 tion, comm mpanies’
January to ughout 2011. In addi
ro adding coto -
elevated th prices have increased . As a result, CPI infla
rt su re gher
other expo to inflationary pres ew ha t hi
, and som
costs and so remain above target a year or so. Indeed,
inflation rises
Mervyn King has had to write to the chancellor Picture: REUTERS to r on
tion is likely three months ago, fo e outlook for inflati
an ex pect ed furthe r. Th rections .
th rise th di
rate might l risks in bo
the inflation rtain, with substantia nal on the current
ce itio
remains un PC judges that, cond on being above or
M ti
Overall the chan ces of infla balanced.
licy, the are evenly
stance of po in the medium term
et
below targ
▲
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CITYA.M. 17 NOVEMBER 2010 Economic News 9
▲
HOUSE PRICES
BY MATTHEW WEST house prices pushed the cost of the at the Royal Institution of Chartered
average UK home down to £211,815, Surveyors (RICS) said although prices
THE fall in house prices in September just 6.1 per cent up on a year ago. could slip a little further the down-
was confirmed by the Department The figures also confirmed data side would be quite limited. “The
for Communities and Local from both the Halifax and more pressing issue remains the rela-
Government (DCLG) yesterday Nationwide building societies, which tively low level of transaction activity.
It published figures which showed showed significant falls in average This has more direct ramifications
house prices fell 0.8 per cent in house prices across the UK in both for the health of the economy
September. Prices also fell 0.7 per cent September. Halifax said £6,000 had and the ability of those made unem-
in the third quarter compared to a 1.6 been wiped off the price of an average ployed to move to find work else-
House prices fell 0.8 per cent in September said DCLG Picture: REX per cent rise during the preceding property in the month. where in the country,” he said.
US wholesale
prices fall as
output falters Delhi’s demand for a) Think eight poppadoms and
a Lamb Bhuna might hit the
energy continues
▲
WORLD ECONOMY
run-up in food prices.
CHINA will unveil food price controls Possible steps include price controls,
and crack down on speculation in subsidies for shoppers, a crackdown Spread betting and CFD trading carry a high level of risk to your capital and
agricultural commodities to contain on hoarding and price gouging as well you can lose more than your initial deposit. These trading products may not
inflationary pressure that its central as a system whereby mayors are made be suitable for all investors so seek independent advice if necessary. Nothing
bank governor highlighted as a risk responsible for a basket of food items, in this advert should be construed as investment advice.
yesterday. the China Securities Journal reported.
With consumer prices rising at their Those found speculating on corn or
fastest pace in more than two years, cotton will also be punished severely, it
the National Development and added.
Reform Commission, the country’s Consumer price inflation sped to a
top planning agency, is preparing a 25-month high in October, with prices Capital Spreads is a trading name of London Capital Group Ltd, which is authorised and regulated by the Financial Services Authority and
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“one-two punch” of actions to rein in rising 4.4 per cent from a year earlier.
food costs, official media reported. Food, which makes up about a third of
Such direct intervention would China’s consumer price index, led the
mark an escalation of the govern- way, climbing 10.1 per cent. Non-food
ment’s efforts to tame inflation and items increased just 1.6 per cent.
The Capitalist
10 CITYA.M. 17 NOVEMBER 2010
EDITED BY
JULIET SAMUEL
GOT A STORY? EMAIL
thecapitalist@cityam.com
Former Bank of Ireland governor Richard Burrows skipped the party Picture: PA
Spitalfields Market last week as they and culture, with its first investment
participated in the sixth annual already supporting a housing project
Centrepoint sleep-out, a fundraiser for in Sri Lanka for displaced families in
homeless charity Centrepoint, which partnership with Habitat for
helps around 70,000 homeless people Humanity. And LSE employees will be
a year. And the gaggle of celebrities, able to donate through their payroll, a
including singers from The Feeling group matching scheme and by help-
and TV producer Alex Reid was joined ing with fundraising events. After all,
by some business interests, as Metro it never hurts to have yet another
5&/
Bank chairman Anthony Thompson avenue for City philanthropy.
cuddled up alongside a host of his
employees to stay warm. Making their
beds alongside Thompson and his col-
leagues were also City workers from
ALL YE FAITHFUL
With a bonus crackdown in the works,
Deloitte, BSkyB, Herbert Smith, 2010 could prove to be the year of the
Forsters, IFDS, King Sturge and Latham “significant other” (SO), as events com-
& Watkins. Whoever said Christmas is panies report a rise in the number of
all about bonuses? firms inviting staff to bring their other
halves to the Christmas party. Venturi’s
Table Corporate Cookery Centre has
seen a jump of 35 per cent, with more
than half of its festive bookings now
including an open invitation to spous-
es. London-based Elysium Global
Events, meanwhile, has seen one in six
events this year including SOs versus
just one in 13 last year.
Venturi’s MD Anna Venturi reports:
“The atmosphere is definitely different
when other halves are involved. They
tend to be more civilised affairs, with
people spending more time talking
Metro Bank’s Anthony Thompson (left) and less time drinking.” Well, quite!
There’s nothing like the watchful eye
of the boss’ spouse to keep the office
ONE NIGHT ONLY culture at its more, ahem, well-
The merry fellows of Land Securities behaved end.
finally celebrated the opening of the
One New Change mall’s roof terrace
last night, with mulled wine and chest-
nuts aplenty. With smoking allowed
ROYAL FLUTTER
As news stations rolled out coverage
on the roof for this one night only from Nairobi to Angelsey and “Kate
before it opens to Joe Public, they at Middleton bikini” moved up the
least had something to do with their Google rankings, one dedicated indus-
hands as they watched a chilly Alisha try was busy crunching numbers for
Dixon – braving the cold in a red strap- the royal wedding. Top of Paddy
less number – performing against the Power’s “wedding wagers” list? The
dramatic backdrop of St Paul’s. date – favourite currently being 13
She was in high spirits despite the August 2011.
weather, dedicating The Boy Does Other factoids available for a flut-
Nothing “to all the men in suits”, ter include who will design Kate
which suited just about everyone pres- Middleton’s dress (Amanda Wakeley
ent. Alas, Tara Palmer-Tomkinson was is favourite at 4/1), how long her train
apparently forced to bow out for some will be (most reckon less than two
vital royal wedding-related duties but, metres, at 2/1), the colour of the
as the events staff hastily shepherded queen’s hat (pink at 9/2) and how
the chestnut roaster out of close prox- many people will tune in to
imity to the building’s fire alarms, the watch the palaver (less than
ladies and gents of Land Securities 26m at 9/2).
were unbothered, happy to drink – Punters on Boylesports,
and smoke – the night away. meanwhile, can bet on the
honeymoon and stag party
locations and as the odds
LSE GIVING move around going into
The London Stock Exchange the new year, The
has announced the launch of Capitalist is just waiting
a foundation to bring togeth- to see which spread-
er all of its charitable activi- betting provider
ties under one umbrella. It cracks out the royal
will focus its funding on wedding charts for
children and young peo- some serious tech-
ple, healthcare and arts nical analysis.
12 News CITYA.M. 17 NOVEMBER 2010
TWO CURRIES
HELPED TRANSFORM
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14 Consumer News CITYA.M. 17 NOVEMBER 2010
Sportingbet’s
Asda sales up BURBERRY SEES PROFIT FUELLED BY ASIA
merger talks
as it creates with Unibet off
7,500 UK jobs
LEISURE
▲
SPORTINGBET said yesterday that
Swedish rival Unibet had withdrawn
from merger talks.
The online betting company, how-
ever, remains in talks with several
other parties over potential deals.
▲
RETAIL Waitrose has also taken its toll. Asda The companies had held talks to
BY JOHN DUNNE responded in April by launching a create a merged group worth £600m.
price guarantee offering to refund Sportingbet was seen as a likely tar-
ASDA, owned by Wal-Mart, yesterday shoppers the difference if they can find get in the wake of the industry-trans-
reported a return to underlying sales their shopping cheaper elsewhere. forming merger between
growth in its fiscal third quarter, International sales, which include PartyGaming and Austria’s bwin,
helped by a focus on low prices and the UK, outstripped Walmart’s which piled pressure on rivals and
the relaunch of its core own-brand domestic business during the quar- traditional bookmakers to keep pace.
grocery range. ter, rising 9.3 per cent to $26.9bn In September, Sportingbet came
The country’s second-biggest super- against the period a year ago, boosted under the spotlight for acquisitions
market chain behind Tesco also said by a foreign exchange gain of $349m. again after it agreed to pay $33m
yesterday it would create more than The retailer’s overall sales increased (£20.7m) to settle a US investigation
7,500 jobs next year by opening new 2.6 per cent to $101.2bn. Earnings over alleged illegal internet gambling.
stores, growing in home shopping, rose nine per cent to $3.44bn against A 2006 US law effectively outlawed
and through its purchase of Netto UK. a year ago. internet gaming.
Sales at stores open over a year rose In settling, Sportingbet agreed to
1.3 per cent in the three months to 30 ANALYSIS l Wal-Mart cooperate with the government
September. That compared with a 0.4 56 $ 54.28 probe, and make employees available
per cent fall in the second quarter 16 Nov for interviews.
and is the first increase since the Sportingbet has long been consid-
54
fourth quarter of 2009. ered an attractive M&A play in the
Asda has lagged behind its major consolidating betting sector, especial-
rivals in sales growth for most of this 52 ly after it settled in the US.
year, hit by a step up in promotions PROFITS have soared at fashion company Burberry after strong sales in Asia. The luxury The company has confirmed that it
which the chain says has clouded its goods group beat forecasts with a 49 per cent rise in first half pre-tax profits to £129m “has had and will continue to have
low-price message.A growing demand 50 China has become one of the fastest growing markets for the company’s red and black discussions with different parties in
for premium ranges which has checked patterned goods. Meanwhile luxury brand Barbour, famous for its wax jackets, relation to a variety of potential
16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
favoured upmarket rivals like produced a £10m profit last year on sales of £74.5m. opportunities”.
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CITYA.M. 17 NOVEMBER 2010 Consumer News 15
LEISURE
BY JOHN DUNNE It left the door open to a resump- He said subject to market condi-
tion of dividends next year if market tions, the board expected further sta-
ENTERPRISE Inns said yesterday it conditions improve as it reported full- bilisation in the pub estates'
would not pay a dividend in the cur- year results in line with market fore- performance and to cut debts via
rent year and expected trading condi- casts. Shares had jumped since cash from the sale of some pubs.
tions to remain challenging. August in anticipation of a restored “The board is confident that the
Shares in Britain’s biggest pub dividend. business is in a sound position to
group went down by more than ten Chief executive Ted Tuppen said: deliver positive returns to sharehold-
per cent at one stage. “Given the current degree of market ers over the medium term, including
The company stopped paying divi- uncertainty, the board does not con- the resumption of dividend pay-
dends in May 2009 to help reduce sider that the resumption of divi- ments.” Enterprise Inns’ chief executive Ted Tuppen forecast a dividend in the “medium term”.
NEWS | IN BRIEF
Amazon tops customer poll Punch finance chief leaves
Amazon has been voted the UK’s most Ian Dyson's shake-up of Punch Taverns
customer friendly company in a poll. continued yesterday when the company
The online retailer beat 17O other nation- announced it was parting company with
al and international brands, with banking finance director Phil Dutton. Dutton will
firm First Direct taking second spot and depart in March. Dyson, a former finance
supermarket chain Waitrose third. The director of Marks&Spencer, is trying to
survey of 5,500 shoppers, carried out by turn around a business that has been
research company Nunwood, showed fighting debts of about £4bn. The com-
that Nando’s was the most popular pany said in a statement that it was on
restaurant chain with diners. the hunt for a replacement.
16 Aviation News CITYA.M. 17 NOVEMBER 2010
AVIATION
super-jumbos per month next year ing in Singapore.
AIRBUS is targeting higher revenue and about three a month in 2012, Rolls-Royce has asked Airbus to
and deliveries despite the chaos compared with the 20 deliveries it return some Trent 900s from produc- easyJet boss Carolyn
caused by the break-up of a Rolls- still expects for this year. tion lines to replace faulty ones on McCall said easyJet
Royce engine on one of its super-jum- The news comes despite possible jets already in service. would start to pub-
bos, it emerged yesterday. delays arising from a need to switch The move could further hit a lish punctuality sta-
The Toulouse-based aircraft giant engines on aircraft already in service much-delayed A380 programme as tistics from next
expects revenue to rise more than five after the A380 accident. Airbus is due to deliver over a dozen year
per cent in the next five years, accord- A Rolls Trent 900 engine on a Rolls-powered A380s – mainly to Picture:
ing to finance chief Hans Peter Ring. Qantas A380 partly disintegrated Singapore Airlines, Qantas and Micha Theiner
Airbus, part of aerospace group mid-flight on 4 November, forcing Lufthansa by the end of next year.
easyJet pays
first dividend
as profits fly
ing relationship and a dialogue,
▲
AVIATION
BY MARION DAKERS which is a move forward,” she said
yesterday.
EASYJET said it will pay its first ever Stelios released a statement wel-
dividend in 2012 yesterday, as it post- coming the dividend, though he
ed a near three-fold rise in full-year added that the payment should be
profit thanks to rising passenger increased to 50 per cent of earnings
numbers and a lower fuel bill. per share over time.
The budget airline will also launch McCall said her wholesale review
flexible fares this year in a bid to since joining the business has
boost its share of business travellers, revealed “a strong business model
the company’s new chief executive and sound strategy with which to
Carolyn McCall said yesterday. build”.
Pre-tax profit at the firm rose to She said easyJet would start to
£154m for the year to the end of publish punctuality statistics from
September, up from £54.7m last January 2011 and improve the crew
year, on revenues up 11.5 per cent to rota to try and minimise disruption
£2.97bn. from outside events such as industri-
McCall, who joined from the al action or volcanic ash.
Guardian Media Group in July, said
the decision to shell out for a divi- ANALYSIS l easyJet
dend was not entirely down to pres- 480 p
sure from the firm’s founder, Stelios
Haji-Ioannou.
“The time is right to set in place a 440 449.30
formula to trigger a dividend pay- 16 Nov
ment in years when the company is 400
profitable whilst at the same time
ensuring that it retains a conserva-
tive capital structure,” said McCall. 360
“I think [Stelios] has been extreme-
ly constructive and we have a work- 16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
AVIATION
putting a man in space.
CHINA yesterday announced a 100- COMAC said the orders came from
plane order for its first commercial jet- four Chinese airlines, which was no sur-
liner, a first step in its ambitions to prise given government encourage-
challenge Airbus and Boeing for a slice ment for the project, but also the
of a global market worth $1.7 trillion. leasing arm of General Electric, which
State-owned COMAC, or Commercial will supply the C919 engines together
Aircraft Corp of China, unveiled the with France’s Safran.
orders at the country’s largest air show It is the first time buyers have com-
yesterday, ending a dearth of orders in mitted to the aircraft, which COMAC
the two years since it launched designs expects to start building next year, fol-
for the 150-seat C919. lowed by a maiden flight in 2014 and
As air travel expands with a billion first delivery in 2016.
Chinese predicted to be flying for busi- Officials did not give a value for the
ness and leisure early next decade, deal or break down the orders by air-
China wants to reduce its reliance on line. A similar deal for Airbus or Boeing
foreign planes and foster a domestic jets would be worth about $7bn.
CITYA.M. 17 NOVEMBER 2010 News 17
▲
BANKING
tion at Aberdeen Asset Management. cent of board seats,” he said to a City
BY JULIET SAMUEL Her appointment will be voted on at audience at the ISCA Hermes trans-
LLOYDS has added a new non-execu- the bank’s next annual general meet- parency in governance awards,
tive director to its board, with current- ing. adding that “boards are intellectually
Victrex chair Anita Frew joining from The announcement came as and socially enriched by the presence
1 December. Centrica chair Roger Carr spoke last of women”.
Victrex is a FTSE 200 manufactur- night on the importance of increasing Also recently the City has seen the
ing firm, but Frew also has experience the number of women on the boards launch of The 30 per cent Club, which
in investment and banking from her of major British companies. aspires to make the boards of major
New Lloyds non-executive director Anita Frew time at the Royal Bank of Scotland “It cannot be right that today in the UK firms 30 per cent female by 2015.
Cash: 20719.24
Margin: 560.00
13:05
Markets
Unrealised P&L: 92.70
Total Position: 20092.70
says PwC
List One Long name... List Three
Sell Buy Change Status
UK 100 Rolling Spread
>
▲
Trade
▲
MINING 4917.0 4919.0
Wall Street Rolling Spread
+45.2
PROPERTY
Trade
>
BY HARRY BANKS 9599 9605
US SP 500 Rolling Spread
+24
BY MARION DAKERS
Trade
1034.6 1035.2 +4.8 >
INDONESIA’S powerful Bakrie family Trade
US Tech 100 Rolling Spread
1644.4
884.8 1647.4
885.2 +6.6
-15.0 > THE ADMINISTRATORS for housing
has joined forces with the Rothschild Trade
Germany 30 Rolling Spread
5538.5 5540.5 +67.0 > repair firm Rok made a further 1,800
banking dynasty to cement its domi- Trade
US Crude Oil Oct 09 Spread
1644.4
884.8 1647.4
885.2 +6.6
-15.0 > people redundant yesterday, after it
nance of Indonesia’s booming coal Trade
GP/USD Rolling Spread
>
failed to find an interested buyer for
16346 16350 +61
exports sector through a London-list- 5
large parts of the business.
ed company. A total of 2,600 staff, around
The deal combines stakes in three three quarters of Rok’s total staff,
companies. Bakrie Group, run by the have now lost their jobs, with
family of politician and tycoon administrator PwC still in last-ditch
Aburizal Bakrie, is joining miner talks with rivals to sell on viable
Berau Coal with prize asset PT Bumi parts of the business.
SPREAD
Resources in a share swap deal with “Regrettably, the redundancies
Vallar – the mining investment fund made today were necessary as it
established by financier Nathaniel became clear in the last 24 hours
Rothschild earlier this year. that we were not going to be able to
Bakrie will gain majority control of find a purchaser for these parts of
London-listed Vallar and rename it the group,” said Rob Hunt, joint
Bumi, a symbol of a move that means administrator and partner at PwC.
Indonesia’s biggest coal producer
gains a greater share of the global
market.
“This is a reverse takeover where
the Bakrie Group is regrouping its
coal mining assets,” said Norico
Gaman, the head of research at
BET N W Hunt said talks were ongoing to
sell the firm’s construction and
social housing division in England,
which employs 500 people.
Rival firms such as Mears, which
took some of Connaught’s contracts
when it went under in September,
Jakarta brokerage PT BNI Securities. Get Spread Betting on your iPhone™ are still in discussions about a pur-
“Vallar is only a vehicle for the Bakrie chase, while others including
Group to consolidate its assets.”
now from just 10p per point* Morgan Sindall are understood to
“Bumi is now aiming to become be chasing clients rather than tak-
one of the biggest global players in ing on Rok’s operations.
the coal industry,” Gaman added. PwC is thought to have planned
As part of the deal, Vallar will pay Spread betting can result in losses for a much swifter disposal of parts
$3bn in cash and new shares to buy a that exceed your initial deposit. of the business, but circling rivals
75 percent stake in Berau and 25 per have been put off by the low returns
cent of Bumi in its first deal since rais- Rok had accepted in order to win
ing $1.1bn and listing in July. contracts.
“We’ve announced the creation of * 10p offer available to new account holders for first 8 weeks. Before going into administration,
an Indonesian coal champion... (that) Rok had already begun to look into
is going to be the largest supplier of a debt refinancing, even though its
thermal coal to China,” Rothschild £90m revolving credit facility is due
said. 020 7150 0499 to expire in March 2012 and its bur-
China’s total imports in 2009 were www.finspreads.com den was far less than that seen at
a record 126m tonnes, triple the 2008 social housing peer Connaught,
level. which went under in September.
iPhone is a trademark of Apple Inc. App Store is a service mark of Apple Inc.
Bakrie Group will own 43 per cent Royal Bank of Scotland and HSBC
of Bumi, while 28.3 per cent will be were two of Rok’s main creditors.
owned by exisiting Vallar ordinary Rok’s shares were suspended at
shareholders. 18¾p last Monday.
Collins Stewart sees growth PINK DIAMOND SELLS FOR RECORD £28M
BANKING
BY MATTHEW WEST £58m in the second quarter. It added according to plan, the firm said.
its net cash balance stood at £88m in Mark Brown, chief executive, of
WEALTH management firm Collins the third quarter compared to £75m Collins Stewart said: “Markets are still
Stewart yesterday said it had made three months earlier. pretty tough but we are now more
steady progress since the first half of Projected financial performance than holding our own. We continue
the year, as it reported total revenue for the period was 17 per cent ahead to strengthen the business with sen-
increased nearly 30 per cent in the of the first half of 2010. ior hires as we re-calibrate the group
third quarter, despite difficult mar- Meanwhile, assets under manage- and equip ourselves for the opportu-
kets in which trading volumes in the ment rose by almost £1bn to £7.6bn nities ahead.”
US and UK remained subdued. in the third quarter from £6.8bn in Shares in Collins Stewart closed 1.8
The wealth manager said total rev- the previous quarter. The integration per cent lower at 80p following the
enues were £75m for the three of both Corazon Capital and announcement.
A RARE pink diamond fetched 45.44m Swiss francs (£28.6m) yesterday, doubling the pre-
vious record to become the most expensive stone ever sold at auction, Sotheby’s said.
The rectangular pink diamond, which weighs 24.78 carats and is about the size of a pin-
ball, was the star lot among 550 on the block at the semi-annual jewellery sales in
Geneva yesterday. Picture: REUTERS
MORTGAGES
BY STEVE DINNEEN market.
CML director general Michael
MORTGAGE sellers could face tough Coogan said: “This set of proposals
new rules under proposals by the would end up doing more harm than
LIMITS.
Financial Services Authority (FSA). good. We strongly urge both the FSA
The watchdog is calling for sellers itself and relevant government minis-
to hold professional qualifications ters to take stock of all the evidence
before they can approach potential before proceeding.
home buyers. “These rules would likely have the
The FSA has conducted a major effect of creating significant financial
review of the market as it seeks to exclusion among perfectly creditwor-
protect buyers from being sold home thy borrowers. In turn, this has wider
loans they cannot afford. consequences for housing and wider
Part of the review calls for new society, and would exacerbate the
affordability rules which would generational wealth divide that
require strict verification checks on already exists. We urgently need a
customers that would take into proper public policy debate on how
account hikes in the rate of interest. housing finance can help the govern-
The FSA is also calling for clarity ment deliver its housing policy, and
over firms selling only a restricted to review whether the risk-averse
number of mortgage options, rather approach which the FSA has adopted
than loans from across the market. would serve mortgage borrowers or
But the Council for Mortgage undermine their reasonable aspira-
Lenders (CML) says the rules could tions to become home owners.”
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▲
REGULATION
available now from an ingenious integrated phonebook that combines all your portionately hitting the Square Mile.
samsungmovies.com social network contacts. Start living life without limits. THE EUROPEAN Commission’s plans France and Germany wrote a letter
to regulate short selling have the to the Commission over the summer
potential to wreck the City’s reputa- urging it to ban short selling of shares
SAMSUNG tion as a global trading centre, a and sovereign bonds.
London MEP said yesterday. “Short selling is socially useful,”
.com www.samsung.com/uk/galaxytab Conservative MEP Syed Kamall said said Kamall. “It is vital that we do not
that, while the Commission consulted over-regulate the EU market, as those
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cians hoped to strengthen the new but their long positions as well.”
CITYA.M. 17 NOVEMBER 2010 News 19
Chief executive
Chris Grigg saw
British Land’s
portfolio value
rise 2.6 per cent
Taylor Wimpey sees profits
at top end of market views
to £8.9bn in the
six months to the
end of September
focus was on margins rather than know the business. While we have
▲
PROPERTY
BY MARION DAKERS sales growth in an interim manage- some refinancing left to do, it should-
ment statement. n’t be as intensive as the last round so
HOUSEBUILDER Taylor Wimpey said it Taylor Wimpey also said finance Ryan should be refocusing on the day-
expects profit to be at the high end of director Chris Rickard would step to-day UK business.”
estimates this year thanks to stable down and be replaced by Ryan Redfern said the firm’s new debt
sales, while a £950m refinancing deal Mangold, the current financial con- facility frees the business from previ-
will give the firm more flexible trad- troller. ous limits, including a £150m annual
ing conditions next year. ““It has been the plan for a while,” ceiling on land purchases.
The company has an order book chief executive Pete Redfern told City Taylor Wimpey’s banks include
worth £883m, down 8.4 per cent on A.M. “Our new finance director has Lloyds, HSBC, Barclays and RBS, as well
last year, though the firm said the been with us for 18 months getting to as company broker JP Morgan.
British Land
eyes disposal TARRANT’S
CHRISTMAS
of City assets MUSIC
kept her “Sell” rating and 450p price
▲
PROPERTY
QUIZ
BY HARRY BANKS target on British Land, preferring
Great Portland Estates and Land
LONDON landlord British Land Securities for their higher exposure to
intends to sell assets in the City finan- London’s West End and better per-
cial district as it takes a more trading- formance. British Land’s 2.6 per cent
focused investment strategy, adding hike in portfolio value to £8.9bn was
an uptick in its exposure to prime below the 7.3 per cent reported by
offices may not last long. Great Portland and 3.4 per cent Have a Christmas party
The company said yesterday its £1bn booked by Land Securities. British
share in developing 2.1m square feet Land’s net asset value rose 4.2 per cent with us – come and join
of prime offices in central London to 525p a share in the six months to 30
would see its portfolio exposure to the September, against 504p at the end of Chris Tarrant for a fun
sector rise to about 40 per cent, from March 2010. In the prior first-half peri-
33 per cent. od, its net asset value was 372p. Supply ¿OOHGHYHQLQJRIPXVLF
“We will be driven, to some extent, of new-build London offices is expect-
as we see opportunities going for- ed to undershoot demand in the next PD\KHPDQGVLQJLQJ
ward,” chief executive Chris Grigg said. three years following a three-year hia-
“We would intend over time to be tus in construction.
more trading orientated in the City, so
in a way that you could see that (port- ANALYSIS l British Land Tuesday 30 November
folio weighting) going up in the short 520 p 489.70 6.45pm - 11pm
term, but potentially down longer 16 Nov
term as we seek to take advantage of 500
the value we create by development.”
His comments came as British Land
posted improved results for the six
480 7KH 1XUVHU\ 3DYLOLRQ
months to 30 September, with portfo-
lio value, net asset value (NAV) and 460 Lord’s Cricket Ground
occupancy all rising, while the compa-
ny’s interim dividend remained flat.
London
16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
Collins Stewart analyst Nan Rogers
PROPERTY
association with new investors”, but
THE SITE earmarked for the 53- no offer to buy back the plot has
storey Beetham Tower on the south
bank has been put back on the mar-
emerged.
BMO said it expects the site to
&DOO020 7821 2828 to book tickets
ket by administrators BMO. bring in excess of £150m. RUHPDLOHYHQWV#ORUGVWDYHUQHUVRUJ
The site at 1 Blackfriars Road, once The developers gained planning
owned by Beetham Organisation and permission in 2007, and estimated
Russian developer Mirax, will be for- the cost of developing the skyscraper
mally marketed by CB Richard Ellis at £1bn. The pair had planned to
in early 2011. build 64 luxury apartments and a
Royal Bank of Scotland placed the 261-bedroom hotel in the tower.
developers’ subsidiary into adminis- Beetham Organisation hoped to
tration in October, after the pair emulate the success of its project in
failed to agree on further funding. Manchester, also named the Registered Charity No. 306054
The Beetham Organisation and Beetham Tower, which attracted ten-
Mirax said in a statement they ants including the Hilton Hotel to
expected to be taking the project out the city centre.
20 News CITYA.M. 17 NOVEMBER 2010
May Jun 09
Apr Jun 09
Sep 09
Mar 0909
year consumers have become steadily that one in four respondents said that -10
Nov 09
HE Christmas spending season less confident that it is a good time to their household had saved less money
Aug 09
May 10
Oct 09
Mar 10
Feb 09
Jun 10
-15
Jun 09
Jan 10
Feb 10
Jul 09
Apr 10
Dec 09
is well under way, but there are spend money on big ticket items: in October than in September. -18
Jul 10
Aug 10
Octp 10
some worrying signs for UK October’s net buying intention score Consumer attitudes to spending -20
Sep 10
-22 -22 -22 -22
retailers in the latest was -31 per cent. suggest that money not saved is not -24 -24 -25 -24 -24 -24 -22 -24 -25 -24 -24
-25 -26
Bloomberg/YouGov Household These figures put consumer spend- being spent immediately: YouGov -29 -30
-30 Generally a worse time or a Trend six month moving average -31 -31
Economic Activity Tracker (HEAT). ing intentions below what they were respondents were asked what they better time to make major purchases
Particular concern is warranted in October 2009 (net -24 per cent), sug- would do with a windfall of one -35
US banks face
calls to pay into
LSE tech expert
mortgage fund to help lure HFT
▲
FINANCIAL MARKETS
BY HARRY BANKS of key business development roles,”
US BANKS and a task force of the Emirdag said in an emailed statement.
nation’s 50 state attorneys general are THE London Stock Exchange, which is The LSE’s share of UK equity trading
nearing a settlement of an investiga- losing market share to low-cost rivals, has fallen to 51.2 per cent so far this
tion into the lending industry’s fore- has hired a technology specialist to month, compared to 95.8 per cent at
closure practices. attract business from controversial the start of 2008, according to data
A settlement would call for Bank of high-frequency trading (HFT) firms. from Thomson Reuters.
America Corp, JPMorgan Chase & Co The LSE is keen to attract more flow The UK exchange had planned to
and others to contribute money to a from HFTs in a bid to claw back busi- upgrade this month the technology
fund to assist borrowers who lost ness lost to rivals such as Chi-X Europe behind its main UK order book to
their homes to foreclosure and which and Bats Europe, that have grown make it more attractive to HFTs.
would be administered by the regula- quickly off the back of high-volume But the LSE postponed the switch
tors. trading firms. until next year after it launched on 2
It would also involve a promise by The UK exchange has hired Audrey November an investigation into “suspi-
banks to do away with “dual-track” Faveeuw as a business development cious circumstances” after its
modifications and foreclosures, a manager reporting to Pinar Emirdag, European share trading system
much-criticised practice in which the LSE’s head of business develop- Turquoise crashed for two hours that
they begin foreclosure proceedings ment since her appointment in July. morning. Turquoise has been trading
before exhausting attempts to modify Faveeuw, who joined the exchange normally since and the investigation is
home loans, according to CNBC. from technology firm Atrium ongoing, a spokesman said.
The task force is being led by Tom Network, is charged with building rela- HFTs, typically computer driven
Miller, the attorney general of Iowa. A tionships with Europe’s elite high-fre- hedge funds, have grown rapidly in
settlement might not be reached for quency trading firms (HFTs). Europe since the European
at least one month, CNBC said. “Audrey has a strong track record of Commission’s Mifid trading reforms.
Audrey Faveeuw has been hired as a business development manager for the LSE
All change on the leaders, sbwilliams has come from outside the top ten
today to lead the way with a massive £177,521 account value, fantastic
trading or just good luck ?
There is still time to play and it is free with £8,000 prize pot still available.
BY STEVE DINNEEN
used to it and have it customised. Another problem is
EXPERTS expect Facebook’s new email that my work bars Facebook from our computers
service to provide a real threat to rivals
such as Google and Microsoft.
so I wouldn’t be able to access my email
Facebook chief executive Mark there.”
Zuckerberg says the platform will
offer integrated email, chat and text
messaging to its users. The firm
believes it can take advantage of a
JOHN PICKETT | LLUK
fragmented communications mar-
ket where internet users must
switch between websites for differ-
“I’m very IT literate and I will be sticking to my Gmail
ent services. account. I don’t have a Facebook account and I don’t
Phil Story, consultant at email want one so I don’t see why I’d use their email. I have
marketing firm eCircle told City
A.M.: “Even if just 10 per cent of a problem with the security and privacy of
Facebook users adopt the service, Facebook.”
that’s 50m people using it for every-
day personal use. It will undoubted-
ly send shock waves through
existing email services.” PAUL KINGDON | AMPHORA
Both Microsoft, through its
Hotmail platform, and Google Facebook chief execu-
through Gmail have attempted to tive Mark Zuckerberg “Facebook is for women and single men and I’m nei-
integrate social networking into says his email service ther. I use Yahoo and email is one of the few things
their email offerings with limited will be a threat to
success. Google this year scrapped its Google and Microsoft they do well. I’d be interested in seeing what it is like
much-hyped Buzz social networking but I doubt I’d make the switch.”
add-on to Gmail after a poor take-up Picture: REUTERS
from its users.
AUTOMOTIVE
per cent and in Spain by 37.6 per cent. Automotive Industry Research at
BY PHILIP WALLER Among carmakers, Italy’s Fiat, Cardiff Business School, Garel Rhys,
▲
CAR sales in the UK and Europe America’s Ford and Chrysler and said the UK scrappage scheme boost- FINANCIAL CRIME Kiener was arrested in October
plummeted in October as the end of Japan’s Toyota were the biggest losers, ed the market by 300,000 cars in 2009 2009 as authorities said Barclays and
government help for the car industry falling 32.9 per cent, 29.5 per cent, and by 100,000 this year, but he said it HELMUT Kiener, founder of German BNP Paribas may have lost millions of
and uncertainty about spending cuts 43.6 per cent and 28.7 per cent respec- benefited the car retail and wholesale hedge fund group K1, is being dollars in the case, which prosecutors
took their toll. tively. industry more than manufacturers. charged with fraud, forgery of docu- said spanned the Atlantic and fea-
New car registrations in the EU fell The best performers was BMW, up It was likely to be 2013 before the ments and tax evasion more than a tured lavish personal spending on
16.6 per cent to 1.03m versus October 5.1 per cent, Volvo rising two per cent car market returned to the pre-reces- year after he was arrested in a multi- planes, a helicopter and luxury prop-
2009, the European Automobile and Mitsubishi gaining 43.2 per cent. sion level of 2.4m cars sold in 2007, he million-dollar investigation. erties. Investors were duped into
Manufacturers Association said. Industry experts said the data said. “The fall in the car market is He is accused of having swindled investing in funds K1 Global and K1
Demand dipped 5.5 per cent to 11.3m showed the impact of economic entirely in keeping with the anaemic investors out of about €345m Invest by pretending the funds were
this year so far, the figures showed. uncertainty and the end of state growth in the economy,” he said. (£293.6m) with an elaborate Ponzi posting significant profits and would
Sales in all big European markets scrappage schemes, which help peo- “People are worried about what scheme, the public prosecutors’ office continue to do so, even though both
fell, with UK demand dipping 22.2 ple to buy new cars in return for trad- will happen to their job prospects in in Wuerzburg, Germany, said in a of them had suffered “massive loss-
per cent, in Germany by a fifth, in ing in old vehicles. the next couple of years.” statement yesterday. es”, the prosecutors’ office said.
Doubts hang
BEATLES EAT INTO APPLE CHART
Selfridges
snaps up
over Cairn’s Dutch store
Indian sale
▲
CONSUMER
RETAIL group Maxeda Retail Group
B.V. said yesterday it has agreed to sell
the Dutch luxury department store
chain, De Bijenkorf – or “the beehive”
out the sale and that the company to Selfridges Group for an undis-
▲
ENERGY
was happy to keep the 40 to 51 per closed sum.
BY PHILIP WALLER
cent stake in Cairn India that it The transaction is part of an over-
UK OIL and gas explorer Cairn Energy agreed to sell. haul of the Dutch non-food retail sec-
yesterday cast doubt on the planned “If it goes through or it doesn’t go tor, with KKR’s Maxeda also selling
sale of most of its Indian business to through, it doesn’t change the reality the Hunkemoeller lingerie stores and
miner Vedanta Resources for up to that it’s a hell of a good project,” private equity group Lion Capital try-
$8.5bn (£5.4bn) , but said it still hoped Watts said. ing to sell the Hema mid-market
to seal the deal next year. Vedanta, which mines zinc, alu- department store chains.
Cairn said there was no guarantee minium, copper and iron in India, De Bijenkorf, whose flagship store
it would sell 40 to 51 per cent of its hopes to use the Cairn stake to is a landmark building in
62.4 per cent stake in Cairn India to expand in the oil and gas market. Amsterdam’s main Dam square, has
London-listed Vedanta due to regula- Cairn plans to use the proceeds of 12 department stores in the
tory uncertainty. the sale to return billions of dollars to Netherlands’ biggest cities including
Cairn investors had hoped the deal shareholders and to fund exploration Rotterdam and The Hague.
would close by the end of the year, in Greenland. “This is an exciting opportunity for
but the government is still deciding Cairn India’s main asset is a 70 per us to enter the Dutch marketplace
whether to back it in the face of com- cent stake in the Rajasthan oil devel- with the acquisition of this iconic
plaints from state-controlled ONGC, opment project with an estimated retailer,” said W. Galen Weston, chair-
Cairn India’s partner in the massive 6.5bn barrels of oil and gas. man of Selfridges Group, in a state-
Rajasthan oilfields. ONGC would like ment.
the tax rules changed to reduce its ANALYSIS l Cairn Energy Selfridges Group, a subsidiary of
tax burden as part of the deal. 500 p Canada-based Wittington
Cairn’s deputy chief executive Investments, operates luxury retailers
Michael Watts told the Independent
460
370.00 Selfridges in the UK, Brown Thomas
and Junior Oil Congress in London 16 Nov in Ireland, and Holt Renfrew in
that the group still expected the deal Canada. With the addition of De
to close in the first quarter of 2011, 420 Bijenkorf, its turnover will be close to
but he added: “You can’t guarantee BEATLES albums yesterday flooded iTunes top 200 chart on their first day on sale. £2bn, the firms said in a joint state-
these things because there are three Analysts predict they could topple top selling albums by Michael Jackson and Black Eyed ment. Maxeda, owned by Kohlberg
parties: the government, ourselves 380 Peas. The release of the rights to iTunes after a lengthy legal wrangle is good news for Kravis Roberts, has international
and Vedanta.” Terra Firma boss Guy Hands, whose embattled music firm EMI holds the rights to retail outlets in Europe, Russia and
16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
Watts said Cairn had not sought Beatles recordings. Picture: REX the Middle East.
CITY MOVES | WHO’S SWITCHING JOBS Edited by Juliet Samuel in association with
senior analysts. Paul Leyland will be initi- Mercer Deloitte’s technology, media and telecoms
Barclays Corporate ating coverage of the gaming sector, hav- Mercer’s Human Capital business has industry practice, which provides adviso-
Barclays Corporate has appointed a new head ing spent two years at Collins Stewart added a new principal and senior consult- ry services for companies in these sec-
of financial institutions. Matt Tuck will return covering the gaming and pub sectors. ant, Alexander Bartfield. He will be devel- tors.
to the bank where he started his career, having Gareth Hunt will be covering the bank- oping the company’s new rewards and
worked for the last eight years for Deutsche ing sector. Kevin Ryan will be covering talent management programme, Human Ratio Asset Management
Bank. In his new role, he will be responsible for insurance, drawing on his 23 years’ expe- Capital Connect, for Europe, the Middle Alice Squires has joined the the
enacting a new stage in the expansion of the rience as a buy and sell-side insurance East and Africa. In his previous position European equities specialist as head of
bank’s financial institutions business. While at analyst. Angelos Anastasiou will cover he was a vice president at Softscape in investor relations, as part of a driving to
Deutsche, he has held numerous management the utilities sector, having two decades’ London, and has also worked at intensify its marketing intiatives. Squires
positions, before which he worked at Citibank experience in this area. Finally, Morten Accenture in Boston. has moved from Deutsche Bank, where
and JP Morgan. Singleton will be on the telecoms team. she was director and head of pan-
In addition to these senior appoint- Deloitte European small and mid-cap equity sales.
Investec Securities has expanded its research ments, Investec has also added to its jun- Peter O’Donoghue has joined the firm as She began her career at Natwest
Investec Investment Banking and team with the appointment of five new ior analyst team. leader of the technology sector for Securities in 1994.
To appear in CITYMOVES please email your career +44 (0)20 7557 7245
updates and pictures to citymoves@cityam.com SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT morganmckinley.com
CITYA.M. 17 NOVEMBER 2010 News 23
vow to chase
80
560 16 Nov 16 Nov 380
75 381.00
360 16 Nov
540 70
340
65
Russian fraud
520 60 320
16 Aug 6 Sep 24 Sep 14 Oct 3 Nov 16 Aug 6 Sep 24 Sep 14 Oct 3 Nov 16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
third country. This will be an offence in bringing cases involving corrup- reiterated its targets of 75,000 boe/d in in North Sumatra.
even if the act of bribery has nothing tion in overseas countries to court. PREMIER Oil, the British explorer and 2012 rising thereafter to 100,000 boe/d Premier also noted a gas and con-
to do with the UK business.” “We are now in a very different posi- producer, yesterday maintained its from existing reserves and resources. densate discovery at West Rochelle. It
Alderman signalled an increasing tion,” he said. production guidance and said a bank The firm reported good progress on said 23 wells were planned over the
level of attention on the activities of “At present I have no jurisdiction refinancing had increased its facilities its key Asian developments, with facil- next 13 months with unrisked poten-
Russia-based businesses. He indicated over foreign corporates who commit by $470m (£295m). ities in place on both the Chim Sao tial of around 400m boe.
that working with foreign law offences in other countries. That will The firm, which has assets in the and Gajah Baru projects and develop- The firm added that the bank refi-
enforcement agencies was, and change when the Bribery Act comes North Sea, Congo, Indonesia, Vietnam ment drilling under way. nancing, which took total facilities to
would continue to be, an increasingly into force,” said Alderman. and Pakistan, said it was forecasting It is also making progress on com- $1.8bn, was achieved at a significantly
important area of the SFO’s work, say- LAW: P:28 production at around 44,000 barrels of pleting commercial agreements for reduced margin.
Markets&Investment
24 CITYA.M. 17 NOVEMBER 2010
LONDON’S TOP 250 Trade these shares from £1.50 with Interactive Investor - www.iii.co.uk
Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low
(p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p)
3i . . . . . . . . . . . . . . . . . . . . . . . .314.90 –4.50 328.30 246.90 Cookson . . . . . . . . . . . . . . . . . . .513.00 –26.50 616.00 364.80 Kesa Electricals . . . . . . . . . . . . .162.00 –1.60 172.40 98.45 Schroders . . . . . . . . . . . . . . . . .1577.00 –42.00 1670.00 1096.00
3i Infrastructure . . . . . . . . . . . . . 118.40 +1.00 118.50 97.00 Croda Intl . . . . . . . . . . . . . . . . .1367.00 –45.00 1540.00 735.00 Kingfisher . . . . . . . . . . . . . . . . . .236.70 –5.90 255.00 196.50 Schroders N/V. . . . . . . . . . . . . .1248.00 –29.00 1330.00 912.50
A.B. Foods . . . . . . . . . . . . . . . .1072.00 –22.00 1113.00 790.00 Daily Mail ‘A’ . . . . . . . . . . . . . . . .546.50 –18.50 573.50 401.70 Ladbrokes . . . . . . . . . . . . . . . . .132.50* –1.90 164.60 120.00 Scot. & Sthrn Energy. . . . . . . . .1147.00 –17.00 1206.00 1006.00
Aberdeen Asset Man . . . . . . . . . .177.20 –2.80 191.60 111.00 Davis Service . . . . . . . . . . . . . . .400.30 –4.40 442.30 356.00 Lamprell . . . . . . . . . . . . . . . . . . .352.30 –2.60 393.90 157.30 Scottish Mortgage. . . . . . . . . . . .649.00 –22.00 684.00 475.00
Admiral. . . . . . . . . . . . . . . . . . .1565.00 –17.00 1721.00 1003.00 Debenhams . . . . . . . . . . . . . . . . .70.00 –1.15 90.00 51.95 Lancashire Hldgs . . . . . . . . . . . .629.50 +9.00 630.00 416.70 SEGRO . . . . . . . . . . . . . . . . . . . .296.50 –5.70 389.30 244.00
Aegis . . . . . . . . . . . . . . . . . . . . .127.90 –6.20 137.30 103.10 Derwent London . . . . . . . . . . . .1435.00 –25.00 1633.00 1183.00 Land Securities . . . . . . . . . . . . . .673.00 –23.50 743.50 543.00
Afren . . . . . . . . . . . . . . . . . . . . .125.90 –1.80 135.90 77.00 Dexion Absolute . . . . . . . . . . . . .137.10 –2.40 148.00 131.20 Legal & General . . . . . . . . . . . . . .96.45 –2.90 107.50 69.05 Serco . . . . . . . . . . . . . . . . . . . . .561.50 –10.00 656.50 491.20
African Barr Gold . . . . . . . . . . . .551.00 –19.50 685.00 520.50 Diageo . . . . . . . . . . . . . . . . . . . 1159.00 –9.00 1240.00 988.00 Lloyds Banking Gp . . . . . . . . . . . .66.60 –3.27 79.15 45.30 Severn Trent . . . . . . . . . . . . . . .1436.00 –23.00 1468.00 981.50
Aggreko . . . . . . . . . . . . . . . . . .1502.00 –77.00 1698.00 727.50 Dixons Retail . . . . . . . . . . . . . . . .25.38 –0.92 39.75 23.07 Logica . . . . . . . . . . . . . . . . . . . .122.90 –3.40 149.10 100.80 Shaftesbury . . . . . . . . . . . . . . . .434.90 +0.90 465.00 348.00
Alliance Trust . . . . . . . . . . . . . . .350.90 –10.10 363.00 292.80 Domino’s Pizza . . . . . . . . . . . . . .523.00 –11.50 535.50 278.20 London Stk Exchange . . . . . . . . .733.50 –7.00 888.50 540.50 Shire. . . . . . . . . . . . . . . . . . . . .1510.00 –10.00 1534.00 1117.00
AMEC . . . . . . . . . . . . . . . . . . . . 1116.00 +4.00 1144.00 728.00 Drax . . . . . . . . . . . . . . . . . . . . . .365.80 –2.70 464.80 321.50 Lonmin . . . . . . . . . . . . . . . . . . .1759.00 –79.00 2198.00 1344.00 SIG . . . . . . . . . . . . . . . . . . . . . . . 118.00 –2.50 142.10 89.55
Amlin . . . . . . . . . . . . . . . . . . . . .399.40 –4.40 437.60 357.30 Dunelm . . . . . . . . . . . . . . . . . . . .496.40 –7.60 521.00 319.40 Man . . . . . . . . . . . . . . . . . . . . . .280.90 –12.80 373.60 199.60 Smith & Nephew . . . . . . . . . . . . .581.00 –8.50 700.50 532.00
Anglo American . . . . . . . . . . . .2886.50 –149.50 3069.00 2210.00 Easyjet . . . . . . . . . . . . . . . . . . . .449.30 –22.80 499.90 339.80 Marks & Spencer. . . . . . . . . . . . .396.00 –7.90 431.40 321.90 Smith(Ds) . . . . . . . . . . . . . . . . . .178.60 –2.60 185.90 103.00
Antofagasta . . . . . . . . . . . . . . .1359.00 –79.00 1482.00 755.50 Edinburgh Inv Tst . . . . . . . . . . . .441.00 –10.50 466.80 345.50 Meggitt . . . . . . . . . . . . . . . . . . . .317.90 –0.30 336.70 234.50 Smiths . . . . . . . . . . . . . . . . . . . 1142.00* –53.00 1297.00 930.00
Aquarius Platinum . . . . . . . . . . .354.20 –22.00 490.00 211.50 Electrocomponents . . . . . . . . . . .260.60 –4.40 266.60 159.50 Melrose . . . . . . . . . . . . . . . . . . .278.00 –12.00 304.90 160.00 SOCO Intl . . . . . . . . . . . . . . . . . .348.00 –2.80 510.00 287.40
ARM Holdings . . . . . . . . . . . . . . .352.30 +0.70 419.50 150.60 EnQuest . . . . . . . . . . . . . . . . . . .128.90 –2.10 138.50 87.35 Mercantile IT . . . . . . . . . . . . . . . .998.50 –26.50 1029.00 822.50 Spectris . . . . . . . . . . . . . . . . . . 1181.00 –41.00 1234.00 653.00
Ashmore . . . . . . . . . . . . . . . . . . .352.00* –11.10 400.50 215.00 Essar Energy . . . . . . . . . . . . . . .505.00 –19.50 566.50 358.50 Michael Page Intl. . . . . . . . . . . . .479.50 –13.90 507.50 326.00 Spirax-Sarco Eng . . . . . . . . . . .1724.00 –21.00 1888.00 1060.00
Astrazeneca . . . . . . . . . . . . . . .3028.00 +12.00 3389.50 2680.50 Eurasian Nat Res . . . . . . . . . . . .919.50 –45.00 1276.00 801.00 Micro Focus . . . . . . . . . . . . . . . .327.00 –12.30 550.00 272.20
Atkins(Ws) . . . . . . . . . . . . . . . . .729.00 –12.00 801.00 549.50 Euromoney Inst Inv . . . . . . . . . . .677.00 –8.00 685.00 383.00 Millen & Copthorne . . . . . . . . . . .513.50 –23.50 585.00 329.20 Spirent Comms . . . . . . . . . . . . . .147.20 –3.10 158.30 90.45
Autonomy Corp . . . . . . . . . . . .1398.00 –11.00 2012.00 1319.00 Experian . . . . . . . . . . . . . . . . . . .703.50 –16.00 763.50 559.00 Misys . . . . . . . . . . . . . . . . . . . . .289.80 –4.70 300.00 196.60 Sports Direct Intl . . . . . . . . . . . . .128.20 –3.00 154.30 89.85
Aveva . . . . . . . . . . . . . . . . . . . .1470.00 +51.00 1572.00 930.00 Ferrexpo . . . . . . . . . . . . . . . . . . .361.00 –31.80 401.60 169.00 Mitchells & Butlers . . . . . . . . . . .340.70 –2.80 351.60 242.50 SSL Intl . . . . . . . . . . . . . . . . . . . 1163.00 — 1190.00 655.50
Aviva . . . . . . . . . . . . . . . . . . . . .395.90* –7.90 428.70 290.20 FirstGroup . . . . . . . . . . . . . . . . .377.30 –11.20 428.40 331.20 MITIE . . . . . . . . . . . . . . . . . . . . .200.00 +4.40 248.60 187.60 St James’s Place . . . . . . . . . . . . .248.10 –8.40 298.00 203.40
Babcock International . . . . . . . . .567.00 –12.50 645.50 489.00 Foreign & Col Inv Tst. . . . . . . . . .288.00 –6.60 300.00 250.00 Mondi . . . . . . . . . . . . . . . . . . . . .492.20 –17.30 562.00 304.70 Stagecoach. . . . . . . . . . . . . . . . .203.50 –2.50 226.10 144.10
BAE Systems . . . . . . . . . . . . . . .345.20* –7.30 389.90 288.10 Fresnillo . . . . . . . . . . . . . . . . . .1361.00 –92.00 1480.00 647.00 Monks Inv Tst . . . . . . . . . . . . . . .335.00 –5.30 349.70 265.00 Standard Chartered . . . . . . . . . .1818.00 –83.50 1975.00 1316.50
Balfour Beatty . . . . . . . . . . . . . . .278.70* –6.00 304.80 228.60 G4S . . . . . . . . . . . . . . . . . . . . . .249.50 –1.70 285.70 238.70 Morrison Wm . . . . . . . . . . . . . . .276.00 –2.50 307.10 255.00 Standard Life . . . . . . . . . . . . . . .220.10* –5.80 238.00 170.00
Barclays . . . . . . . . . . . . . . . . . . .273.80 –8.65 394.25 253.40 Genesis Emerging Mkts Fd . . . . .514.00 –13.00 542.50 383.00 Murray Intl Tst . . . . . . . . . . . . . . .894.00* –14.00 938.50 720.00 SuperGrp . . . . . . . . . . . . . . . . .1450.00 +49.00 1465.00 499.00
Barratt Development . . . . . . . . . . .73.55 –3.35 149.90 73.55 GKN . . . . . . . . . . . . . . . . . . . . . .181.60 +1.60 188.40 100.40 National Express. . . . . . . . . . . . .237.90 –2.20 261.30 164.80 SVG Capital . . . . . . . . . . . . . . . .205.70 –7.30 225.00 118.30
BBA Aviation . . . . . . . . . . . . . . .194.90 –4.40 220.00 145.90 GlaxoSmithKline . . . . . . . . . . . .1213.50* –8.50 1347.00 1088.00 National Grid . . . . . . . . . . . . . . .582.00 –8.00 607.65 474.80 TalkTalk . . . . . . . . . . . . . . . . . . .153.00 +8.90 154.10 106.60
Berkeley . . . . . . . . . . . . . . . . . . .795.00 –12.00 917.50 735.00 Great Portland Estates . . . . . . . .334.30 –1.70 368.60 265.40 Next . . . . . . . . . . . . . . . . . . . . .2108.00 –49.00 2361.00 1816.00 Talvivaara Mining . . . . . . . . . . . .524.00 –18.00 597.00 341.40
BG . . . . . . . . . . . . . . . . . . . . . .1208.50 –48.00 1302.50 966.90 Greene King . . . . . . . . . . . . . . . .439.30 –7.50 484.00 372.50 Northumbrian Water . . . . . . . . . .350.10 –2.90 364.00 238.90 Tate & Lyle . . . . . . . . . . . . . . . . .513.00 –7.00 534.50 388.00
BHP Billiton . . . . . . . . . . . . . . .2318.00 –88.00 2500.00 1678.00 Halfords . . . . . . . . . . . . . . . . . . .408.50 –4.50 562.50 370.10 Ocado Grp . . . . . . . . . . . . . . . . .132.20 –2.20 169.00 120.90
BlackRock Mining . . . . . . . . . . . .708.00 –23.00 737.50 490.00 Halma . . . . . . . . . . . . . . . . . . . . .325.90 –3.40 345.50 221.80 Old Mutual . . . . . . . . . . . . . . . . .126.40* –4.70 146.90 95.30 Taylor Wimpey . . . . . . . . . . . . . . .24.82 –0.13 46.34 22.12
BlueBay . . . . . . . . . . . . . . . . . . .481.50* — 495.00 251.00 Hammerson . . . . . . . . . . . . . . . .408.50 –10.50 460.30 332.20 Partygaming . . . . . . . . . . . . . . . .218.90 –6.10 339.70 205.80 Telecity . . . . . . . . . . . . . . . . . . . .453.30 –10.60 546.00 323.50
Bluecrest Allblue GBP . . . . . . . . .174.00 –0.50 174.50 151.60 Hargreaves Lansdown . . . . . . . .479.40 –15.40 502.50 259.40 Pearson . . . . . . . . . . . . . . . . . . .930.00 –19.00 1069.00 812.00 Templeton Emrg Mkts . . . . . . . . .642.50 –15.50 688.00 470.00
Booker . . . . . . . . . . . . . . . . . . . . .54.80* –0.50 56.00 37.50 Hays . . . . . . . . . . . . . . . . . . . . . .108.10* –1.80 125.30 82.50 Pennon . . . . . . . . . . . . . . . . . . . .629.00 –7.50 644.00 458.90 Tesco . . . . . . . . . . . . . . . . . . . . .420.20* –2.40 454.90 368.40
BP . . . . . . . . . . . . . . . . . . . . . . .435.65 –13.05 658.20 296.00 Henderson . . . . . . . . . . . . . . . . .128.90 –2.80 157.80 112.10 Persimmon . . . . . . . . . . . . . . . . .356.60* –0.70 520.00 335.90 Thomas Cook . . . . . . . . . . . . . . .184.90 –2.70 277.20 167.50
Brit Insurance . . . . . . . . . . . . . .1041.00 –1.00 1052.00 709.00 Heritage Oil. . . . . . . . . . . . . . . . .389.30 –1.70 585.00 295.90 Petrofac . . . . . . . . . . . . . . . . . .1486.00 –43.00 1545.00 900.00 Travis Perkins . . . . . . . . . . . . . . .839.50* –22.50 915.00 647.50
British Airways . . . . . . . . . . . . . .259.50 –10.90 290.00 180.20 Hikma Pharma . . . . . . . . . . . . . .750.50 –13.00 813.00 480.00 Petropavlovsk . . . . . . . . . . . . . . .998.00 –74.00 1370.00 834.00 TUI Travel . . . . . . . . . . . . . . . . . .198.70 –4.00 313.90 189.20
British Amer. Tob . . . . . . . . . . .2382.50 –16.50 2490.50 1832.00 Hiscox . . . . . . . . . . . . . . . . . . . .360.30 +1.80 371.60 299.60 Phoenix Group . . . . . . . . . . . . . .671.00 –5.00 775.00 550.50 Tullett Prebon . . . . . . . . . . . . . . .348.00* –14.50 427.00 261.20
British Empire Tst . . . . . . . . . . . .480.00* –10.50 497.00 338.50 Hochschild Mining . . . . . . . . . . .547.50 –33.00 580.50 220.00 Premier Farnell . . . . . . . . . . . . . .294.00 –0.50 299.20 150.80 Tullow Oil . . . . . . . . . . . . . . . . . 1196.00 –57.00 1375.00 979.50
British Land . . . . . . . . . . . . . . . .489.70 –17.30 525.00 416.00 Home Retail . . . . . . . . . . . . . . . .212.50* –1.80 326.30 201.70 Premier Oil . . . . . . . . . . . . . . . .1831.00 –29.00 2032.00 984.00 UK Commercial Prop. . . . . . . . . . .76.75* –0.60 84.90 71.00
Britvic. . . . . . . . . . . . . . . . . . . . .484.40 +4.00 518.00 360.70 Homeserve . . . . . . . . . . . . . . . . .429.60 +15.80 502.00 405.40 Provident Financial . . . . . . . . . . .738.00* –5.50 983.50 725.50 Ultra Electronics . . . . . . . . . . . .1585.00 –37.00 1903.00 1198.00
Brown(N.) . . . . . . . . . . . . . . . . . .280.00 –4.70 308.00 204.80 HSBC Hldgs . . . . . . . . . . . . . . . .665.00 –16.80 766.80 595.20 Prudential . . . . . . . . . . . . . . . . . .608.00 –15.00 665.00 475.70 Unilever . . . . . . . . . . . . . . . . . .1835.00* –18.00 2024.00 1662.00
BSkyB . . . . . . . . . . . . . . . . . . . .724.00 –5.00 737.00 521.00 Hunting . . . . . . . . . . . . . . . . . . .622.50* –22.50 663.50 429.10 PZ Cussons . . . . . . . . . . . . . . . .386.10 +1.10 406.80 231.70
BT . . . . . . . . . . . . . . . . . . . . . . .165.10 –4.20 170.10 108.40 ICAP . . . . . . . . . . . . . . . . . . . . . .465.90 –11.40 501.50 291.70 Qinetiq . . . . . . . . . . . . . . . . . . . . .97.70 –2.30 179.10 96.00 United Utilities . . . . . . . . . . . . . .619.50 –7.50 634.50 467.40
Bunzl . . . . . . . . . . . . . . . . . . . . .719.00* –5.00 784.50 614.00 IG . . . . . . . . . . . . . . . . . . . . . . . .494.10 –13.40 560.00 312.60 Randgold Resources. . . . . . . . .5930.00 –170.00 6755.00 4126.00 Utd Business Media . . . . . . . . . .648.50 –18.00 692.00 408.30
Burberry . . . . . . . . . . . . . . . . . .1004.00 –16.00 1065.00 555.50 Imagination Tech Gp . . . . . . . . . .325.00 –5.00 445.00 200.00 Reckitt Benckiser . . . . . . . . . . .3475.00 –52.00 3667.00 3019.00 Vedanta Resources . . . . . . . . . .2194.00 –86.00 2967.00 1795.00
Cable & Wire Comms . . . . . . . . . .49.00* –0.50 150.00 46.51 IMI . . . . . . . . . . . . . . . . . . . . . . .823.50 –17.50 855.50 483.10 Reed Elsevier . . . . . . . . . . . . . . .530.00 –6.50 566.00 454.60 Victrex . . . . . . . . . . . . . . . . . . . 1185.00 –10.00 1355.00 753.00
Cable & Wire Wwide . . . . . . . . . . .68.90 –0.20 94.80 60.05 Imperial Tobacco. . . . . . . . . . . .1988.00 –11.00 2159.00 1728.00 Regus . . . . . . . . . . . . . . . . . . . . . .79.40 –2.60 125.50 64.05 Vodafone . . . . . . . . . . . . . . . . . .170.45 –3.60 179.90 126.50
Cairn Energy. . . . . . . . . . . . . . . .370.70 –8.30 497.60 306.80 Inchcape. . . . . . . . . . . . . . . . . . .334.50 –2.70 358.00 235.00 Renishaw . . . . . . . . . . . . . . . . . 1158.00 –33.00 1250.00 479.00 Weir . . . . . . . . . . . . . . . . . . . . .1660.00 –46.00 1720.00 660.00
Caledonia Invs . . . . . . . . . . . . .1765.00 –32.00 1833.00 1496.00 Informa . . . . . . . . . . . . . . . . . . . .417.40 –13.60 450.50 263.30 Rentokil Initial . . . . . . . . . . . . . . . .95.70 +0.15 140.20 89.40 Wellstream Hldgs . . . . . . . . . . . .740.00 –14.50 810.00 429.70
Capita . . . . . . . . . . . . . . . . . . . . .735.00 +3.50 829.50 693.00 Inmarsat . . . . . . . . . . . . . . . . . . .672.50 +0.50 831.00 603.50 Resolution . . . . . . . . . . . . . . . . .242.50 –7.10 280.50 220.10 WH Smith . . . . . . . . . . . . . . . . . .453.80 –12.20 551.00 392.20
Capital & Counties . . . . . . . . . . .148.00 –2.20 159.00 99.60 Intercontl Hotels . . . . . . . . . . . .1081.00 –22.00 1244.00 803.00 Rexam . . . . . . . . . . . . . . . . . . . .318.20 +7.20 348.80 271.40 Whitbread . . . . . . . . . . . . . . . . .1691.00* –43.00 1807.00 1260.00
Capital Shopping Centres . . . . . .372.60 –11.90 523.50 300.10 Intermediate Capital . . . . . . . . . .332.90 –5.80 352.80 233.50 Rightmove . . . . . . . . . . . . . . . . .755.00 –19.50 830.00 456.90 William Hill . . . . . . . . . . . . . . . . .159.40* –3.20 217.80 157.20
Carillion . . . . . . . . . . . . . . . . . . .341.20 –6.50 361.90 272.00 Intertek . . . . . . . . . . . . . . . . . . .1931.00* –28.00 1964.00 1136.00 Rio Tinto . . . . . . . . . . . . . . . . . .4120.00 –209.50 4477.50 2751.00 Witan Inv Tst . . . . . . . . . . . . . . . .472.60 –8.90 492.00 397.30
Carnival . . . . . . . . . . . . . . . . . .2631.00 –46.00 2937.00 1963.00 Intl Personal Fin . . . . . . . . . . . . .307.10 –6.70 340.90 181.40 RIT Capital Partners . . . . . . . . .1131.00 –22.00 1215.00 940.00
Catlin . . . . . . . . . . . . . . . . . . . . .351.50 –9.40 394.60 303.20 Intl Power . . . . . . . . . . . . . . . . . .417.90 –2.60 438.10 265.90 Rolls Royce . . . . . . . . . . . . . . . .589.00* –8.00 661.50 466.10 Wolseley . . . . . . . . . . . . . . . . . .1707.00 –54.00 1837.00 1155.00
Centamin Egypt . . . . . . . . . . . . .171.50 –4.50 202.80 103.50 Invensys . . . . . . . . . . . . . . . . . . .330.40* –17.50 350.30 224.90 Rotork . . . . . . . . . . . . . . . . . . .1674.00 –38.00 1906.00 1101.00 Wood Group (John). . . . . . . . . . .486.90 +8.20 492.60 279.60
Centrica . . . . . . . . . . . . . . . . . . .333.40* –4.30 347.00 244.70 Investec . . . . . . . . . . . . . . . . . . .497.80 –12.20 565.00 411.50 Royal Bank Of Scot . . . . . . . . . . . .40.86 –1.46 58.95 28.25 WPP . . . . . . . . . . . . . . . . . . . . . .721.50 –13.00 758.50 562.50
Charter Intl . . . . . . . . . . . . . . . . .695.50 –20.00 855.50 563.50 ITV . . . . . . . . . . . . . . . . . . . . . . . .67.10 –3.95 73.00 46.77 Royal Dutch Shell A . . . . . . . . .2006.50* –42.50 2106.50 1621.00 Xstrata . . . . . . . . . . . . . . . . . . . 1311.50 –70.50 1462.50 832.50
Chemring . . . . . . . . . . . . . . . . .2801.00 –26.00 3711.00 2551.00 Jardine Lloyd Thompson. . . . . . .579.50 — 604.50 420.70 Royal Dutch Shell B . . . . . . . . .1969.00* –46.00 2071.00 1550.00 LONDON TOP 250 BY MARKET CAPITALISATION
Close Bros . . . . . . . . . . . . . . . . .793.00* –13.50 834.00 657.00 Johnson Matthey . . . . . . . . . . .1829.00 –79.00 1999.00 1435.00 RSA Insurance . . . . . . . . . . . . . .126.20* –0.70 137.40 114.10
Cobham . . . . . . . . . . . . . . . . . . .204.50 –1.70 278.60 199.20 JPMorgan Emerg Mkts . . . . . . . .592.00 –9.00 618.00 448.00 SABMiller . . . . . . . . . . . . . . . . .2014.50 –15.50 2103.00 1638.00 * Ex-Dividend † Suspended
COLT Group . . . . . . . . . . . . . . . . 119.50 — 144.20 107.70 Jupiter Fnd Mgmt . . . . . . . . . . . .286.50 –3.50 310.00 180.00 Sage . . . . . . . . . . . . . . . . . . . . . .263.00 –2.20 286.80 208.20
Compass . . . . . . . . . . . . . . . . . .530.00 –10.50 574.50 399.30 Kazakhmys . . . . . . . . . . . . . . . .1421.00 –93.00 1634.00 955.50 Sainsbury(J) . . . . . . . . . . . . . . . .373.70 –5.30 397.00 307.60 www.interactivedata.com
U
recorded its biggest fall in three S stocks fell nearly two per cent
months yesterday as concerns yesterday as the prospect of
over Irish government debt and more European bailouts and
the prospect of another euro zone worries China will rein in infla-
bailout dragged banking and com- tion prompted investors to abandon
modity-related stocks lower. risky assets.
At the close the FTSE 100 was down One result was a slide in resource
138.51 points, or 2.4 per cent, at stocks, such as Alcoa, which fell 2.8
5,681.90, its biggest daily fall since 11 per cent to $13.03, and Exxon
August. “Metal prices and commodities are United States where core producer ker sentiment after Numis Securities Mobil, which dropped 2.2 per cent
Banks were the worst hit sector, all going down on the back of the prices recorded their largest decline lifted its rating on the outsourcer to to $68.94. U.S. crude oil futures set-
with Lloyds Banking Group and Irish story and fears of yet another in more than four years and “buy” from “add”. tled 3 per cent lower at $82.34 a
Standard Chartered shedding 4.7 per euro crisis rearing its head. And no- November homebuilder sentiment barrel, gold and metal prices fell
cent and 4.4 respectively. one knows what sort of exposure the was up less than expected. and the dollar index jumped 0.9
Ireland has so far resisted calls to banks have got to Irish debt.” Earlier, inflation in Britain rose ANALYSIS l FTSE per cent. The Dow Jones industrial
request a state bailout, as Greece did Elsewhere among financials Man unexpectedly to a four-month high in 6,000 5,681.90 average dropped 178.47 points, or 1.59
in May, and insisted only its banks Group was a big faller, off 4.4 per cent, October. 16 Nov per cent, to 11,023.50. The Standard &
need assistance, despite government with traders saying that its flagship Rexam was the standout FTSE 100 5,800 Poor’s 500 Index shed 19.41 points, or
bond yield spreads blowing out to AHL fund was having a tough week. riser, adding 2.3 per cent, after the 5,600 1.62 per cent, to 1,178.34. The Nasdaq
record levels in recent weeks. Mining and energy stocks were also drinks can maker said it expected its Composite Index gave up 43.98
“This will be a continual roller- knocked by lingering fears of interest second half results to be in line with 5,400 points, or 1.75 per cent, at 2,469.84.
coaster over the next few weeks. It's a rate hikes in China, the world's its expectations, prompting Seymour Declining stocks handily out-
5,200
broken record, but markets hate largest commodities consumer. Pierce to repeat its “buy” rating on numbered advancing ones on the
uncertainty,” said James Hughes, ana- Also weighing on confidence was the stock. Capita Group, up 0.5 per 5,000 NYSE by 2,642 to 405, while on the
16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
lyst at CMC Markets. weaker-than-expected data out of the cent, was also boosted by positive bro- Nasdaq.
CITYA.M. 17 NOVEMBER 2010 Investment | Fund Management 25
A
FTER a decade in the financial
wilderness, investment trusts are
emerging, blinking, back into the
mainstream. Tainted by the split-
cap scandal at the end of the Nineties,
investors have favoured their open-ended
cousins for the past decade.
Yet investment trusts have, on the
whole, outperformed the FTSE All Share
and the FTSE World ex UK indices over this
period. They have also outperformed or
done as well as OEICs in most major sec-
tors apart from Japan, according to data
from Winterfloods.
In spite of their better performance,
there are almost six times as many assets
invested in UK authorised unit trusts and
open-ended investment companies (OEIC)
than in investment trusts according to
data from the Investment Management
Association (IMA) and the Association of
Investment Companies (AIC).
Over the next five to 10 years this imbal-
ance is likely to be redressed for two main
reasons. The first reason is their capacity to
have revenue reserves, which help an
investment trust to maintain its dividend
payout even when the companies that it is
invested in cut their dividends. for unit trusts to maintain dividends,” says formance, which is not required of open- As the need for income continues and
Morningstar’s director of closed-end fund Peter Hewitt, manager of the F&C ended funds to the same extent. Finally, regulations change , trusts should become
research Jackie Beard says: “Clients who Managed Portfolio Trust – a trust that the average total expense ratio of invest- a more popular way of investing over the
really need income from their investments invests in other trusts. ment trusts tends to be around 25 to 50 next decade. But given their superior per-
have struggled recently. Investment trusts The second major reason is the Retail basis points cheaper than that of OEICs, formance track record, why wait for them
offer a way of looking elsewhere for that Distribution Review (RDR), which is sched- says F&C’s Hewitt. to become popular to buy them?
income and meeting their needs. Their rev- uled to come into force in December 2012.
enue reserves give more certainty of Since the commission bias will be removed
income payments and can avoid the need from the system – investment trusts have DIFFERENCE BETWEEN INVESTMENT TRUSTS AND OEICS Source: Morningstar
to draw on capital.” almost exclusively never paid commission 11/11/09 09/11/07 11/11/05 Latest Total
Unlike open-ended funds, investment to financial advisers – this will level the 11/11/10 11/11/10 11/11/10 Portfolio Expense
trusts only have to pay out 85 per cent of playing field. The availability of trusts on % Performance % Performance % Performance Size Ratio
their dividend income. Although most pay platforms should also increase, improving
Change Change Change (£m)
out 90-95 per cent, this small percentage the distribution channels and the take-up
can build up over time to create significant among private investors. BlackRock New Energy -10.4 -42.03 -1.44 116 1.3
reserves. Investment trusts have a long his- But these two factors are not the only Investment Trust
tory – the first was set up in 1868 by F&C. advantages that investment trusts have. BGF New Energy A2 USD -9.79 -36.46 13.86 1,812 2.09
This has been reflected in their dividend Their closed-end structure means that
performance relative to open-ended funds. once the money has been raised, the fund BlackRock World Mining Trust 39.18 7.98 148.2 1,537 1.4
For example, if you compare the dividend manager is free to focus on running the
change for the Invesco High Income and money raised without worrying about BGF World Mining A2 USD 28.16 7.74 147.95 9,175 2.09
the Edinburgh Investment Trust, the for- potential or actual inflows or outflows of
mer has had to cut its dividend by 2.5 per money. Since retail investors tend to buy Dunedin Smaller Companies Ord 36.41 15.61 48.41 73 1.4
cent this year whereas the trust increased high and sell low, an OEIC manager might Aberdeen UK Smaller Companies A 24.06 0.18 24.15 154 1.61
it by 1 per cent. This is despite the fact that find himself at the top of a bull market
both are managed by Neil Woodford and with a lot of money to invest. Equally, in a EP Global Opportunities 9.88 18.82 21.49 50 1
hold approximately (although not exactly) bear market as investors rush for the exit, Edinburgh Partners Glbl Opps USD I 7.07 6.14 21.79 1,432 N/S
the same stocks. he may have to sell at the trough.
This also holds true for Investec Investment trusts are also structured as JPMorgan Emerging Markets ORD 28.65 35.6 119.06 769 1.05
Managed Distribution and Temple Bar – companies, which means that if a manager JPMorgan Emerging Markets A Acc 24.03 26.29 109.54 950 1.67
managed by Alastair Mundy – and for underperforms, the board can take corpo-
Karen Robertson’s Standard Life Equity rate action and potentially replace him. Standard Life UK Smaller Companies 63.92 65.13 168.96 121 1.2
Income and Standard Life Equity Income Since they are listed companies, they also
Investment Trust. “It’s an uphill struggle have to be transparent about their per- Standard Life UK Smaller Cos R 41.33 20.72 100.58 784 1.59
EURO WILL BE
HIT BY FEARS The market only cares
OF FRACTURE
BORIS SCHLOSSBERG
DIRECTOR OF CURRENCY RESEARCH, GFT
about American yields
US Treasuries are the
T
HE euro-dollar opened for trade this
week haunted by the same sovereign
debt concerns that dogged it the deciding factor for
previous week. The problems with
Ireland remained unresolved and media reports the dollar-yen trade,
were rife with speculation that the ECB, EU
Commission and the IMF all pressured the Irish says Donata Huggins
government to accept a rescue package. So far,
Irish authorities have resisted any attempts at
T
a bailout, insisting they have enough capital to HE currency market just doesn’t
operate until the middle of next year. care about Japan at the moment. It
It is true that with approximately €18bn of didn’t even flinch when Monday’s
cash on hand, Irish fiscal officials can keep the third quarter GDP figures showed
government running until June 2011. Despite that its economy is expanding at a whop-
their bluster, market pressure on the Emerald ping annualised pace of 3.9 per cent. It
Isle is unlikely to let up as speculators now see just wasn’t interested in the fact that the
the situation as essentially irreparable. With manufacturing sector was boosted by the
Ireland now shut out from the credit markets mass purchasing of air conditioners – not
as the cost of borrowing has become prohibi- one bit. It’s all about the dollar at the
tively expensive, the country is in an increas- moment. Or US bond yields to be more
ingly precarious financial state. specific.
Meanwhile, EU officials are no doubt eager Ten-year US bond yields have – some-
to prevent any further erosion of confidence what unexpectedly – hit a three-month
and to allay fears over the possible fracture of high. Everyone was expecting bond Look at that yield
the union. Last weekend Portuguese foreign prices to rise and yields to fall after the rise
affairs minister Luis Amado aggravated the second round of quantitative easing (QE),
situation, saying Portugal faces "a scenario of but now the opposite has happened, Picture: GETTY
exit from the Eurozone" if it fails to tackle its traders are linking the change to the rise
economic challenges. This is precisely the type of the dollar against the yen.
of rhetoric EU officials would like to avoid. “For as long as US bond yields are bought at the height of bond prices are watershed for Japan, soon the fate of dol-
After several months of ignoring the issue going up so will the dollar,” says Michael now bailing out of the trade. Now the lar-yen will rest on the performance of
the markets are focusing again on Europe’s Hewson of CMC Markets. “It’s a dollar world has not ended and the economic the Asian economies. I know this doesn’t
sovereign debt problems and stability con- story and it could be for a while.” So con- indicators are looking more robust, these correlate to the US bond yield pattern,
cerns could weigh on the currency for the fident, he has his sights on a target of doom merchants are pulling out of but correlations are made to be broken.”
foreseeable future. Another concern is that ¥84.20, heading all the way back to the bonds and looking for a better return. So the bullish on dollar-yen should go
German data has started to falter after 200-day moving average, and then maybe The knock on effect is that the yields are long on the pair for the meantime, but
recording strong growth for most of the third even returning to the giddy summer rising despite the Fed’s intervention. bear in mind that the factors in play will
quarter. Since Germany is the financial back- heights of ¥88.00. But be warned, Juckes says he doubts not be around for forever. Choosing your
stop for the whole EU, any problems there this will last long: “This is a short-term exit will be the challenge.
could threaten possible rescue attempts. QE CHEERLEADERS
That’s why yesterday and today’s meeting of So what will keep the bond yield rising? ANALYSIS l The performance of the dollar against the yen over the last six months
European finance ministers could prove critical QE’s cheerleaders say that the market has
¥
to the near-term direction of the euro. been given a fright from Richmond 92
Boris Schlossberg and Kathy Lien are direc- Federal Reserve president Jeffrey Lacker’s
tors of currency research at GFT. Read com- comment that the Fed might need to 90
mentary at www.GFTUK.com/commentary or tighten monetary policy and a strength-
e-mail borisandkathy@gftuk.com. ening campaign against QE. This – they 88
suggest – means that the amount of QE
already announced could be reduced. 86
The reality for the bond yield is probably
more complex. 84
Kit Juckes, a forex expert at Societe
Generale, pins the unexpected rise on
82
those who believed “the world was end-
ing” in the lead up to QE and bought
bonds at low yield. Late entrants who 2010 June July Aug Sep Oct Nov
SPREAD BETS | CFDs | FOREX / gftuk.com / free phone 0800 358 0864
CD03UK.113.073010
CITYA.M. 17 NOVEMBER 2010 Investment | Foreign Exchange 27
THE
Profiting from TIPSTER
THE YEN IS
T
HE aftermath of the G20 seemed to
I
N 2004, Alan Greenspan denied that mentals – forcing traders to react, not pre- dollar. The pound failed to hold onto gains
it was possible to make money by pre- dict. against the dollar and dipped back below the
dicting what is going to happen to $1.6000 level. Not being able to hold onto
currencies. As he put it: “My experi- FOCUS ON FUNDAMENTALS such an important psychological level could
ence is that exchange markets have So does that mean that traders should well lead to further weakness. Capital
become so efficient that virtually all rele- give up? Surely not. As Amos Galvin, of Spreads quotes a spread of $1.5993-$1.5995
vant information is embedded almost Macro Currency Group, explains, markets for sterling-dollar.
instantaneously in exchange rates to the aren’t perfectly efficient – in fact, many But sterling-euro may still have space to
point that anticipating movements in traders are very distracted from the funda- climb. In fact, higher than expected inflation
major currencies is rarely possible”. mentals. In his opinion, the important might even help push it back towards the
In that, he echoed the economist thing is to watch indicators like interest recent low of around £0.8100. CMC Markets
Burton Malkial, who once said that specu- rates and investor positioning to work out change soon. To make profits, traders will Traders need to stay offers a spread on euro-sterling of
lators “might as well be monkeys throw- when the market has accurately priced in need to keep watching the news and the alert to stay on top £0.84956-£0.85974.
ing darts at the Wall Street Journal”. What news – and when they haven’t, to profit markets carefully and they will need to be Traders should watch out, however.
they were essentially saying is that unless from it. Profits are made not from predict- ready to react decisively and quickly to Thanks to Irish fears and crisis talks in the
you know the news before other people, it ing the future, but rather from accurately changes. And ideally more accurately than eurozone, the greenback has been perform-
should be impossible to make a profit interpreting news. a monkey with a dartboard. Picture: REUTERS ing well, whereas the euro has been slipping
from trading currencies – if you can pre- But as Nick Hocart, of Xenfin Capital, since the end of October, but if the market
dict the future, so should everyone else be says, it is also possible to make a profit decides that a bailout is likely for Ireland
able to, and so the possibility to make a simply by being systematic and fast. In ANALYSIS l Trade weighted index for the US dollar then the trend may reverse. Cantor Index
profit will instantly disappear. Hocart’s opinion, there is no point in try- offers a spread of $1.35913–$1.35923.
And as recent events have shown, that ing to predict where markets will go – 79 The South African economy has been
makes markets particularly responsive to instead, the best strategy is to “find trends Quantitative easing
overheating for a while, and it could be
news. Fears of a sovereign debt crisis in and get onto them” before too many oth- 78 announced about to burn up. Yesterday the South
Ireland drove the euro to a seven week low ers do, like surfers looking for waves. He African rand fell to a seven week low
yesterday, while dovish comments by the says that he has a lot more losing trades 77
against the dollar, as European uncertainty
New York Fed president, William Dudley, than winning ones – but the winning ones weighed on commodity prices. With the dol-
drove the dollar down too. Even though tend to win a lot more. lar on the up, traders would seem wise to
76
Ireland hasn’t gone bankrupt, and the What traders must remember is what consider selling the rand against the dollar.
Federal Reserve hasn’t actually changed they are up against. In recent months, Source: Bloomberg IG Markets offers a spread of R7.05725-
its policy, the hint that either event might markets have been exceptionally volatile 2010 20 Oct 22 Oct 26 Oct 28 Oct 2 Nov 4 Nov 8 Nov 10 Nov 12 Nov
R7.07700 on US dollar-South African rand.
come to pass changes the potential funda- and news driven, and that is not likely to Daniel Knowles
My pick: Buy US dollar/Canadian dollar at Ca$1.0090 My pick: Stay long dollar-yen from ¥82/short Aussie-Loonie below Ca$0.99 My pick: Long dollar-yen at ¥83.08
Expertise: Technical analysis Expertise: Fundamental and technical analysis with risk management Expertise: Global macro
Average time frame of trades: 1 month-3 months Average time frame of trades: 1 day-1 week Average time frame of trades: 1 week-6 months
Setbacks have been well supported by parity, and the market finally My long dollar-yen setup was triggered with the range break above ¥82 Dollar-yen has cleared resistance at the top of a falling channel that
looks like it could be in the process of carving out yet another base. A and subsequent channel break at ¥82.65. Though I question the risk guided the pair down since early May. A bullish Three Inside Up can-
break and close back above Ca$1.0100 will confirm a double bottom reaction that further Ireland/European troubles could draw, I will keep dlestick pattern on the weekly chart reinforces the case for an upside
that should accelerate gains well above Ca$1.0200 and then put the the stop at ¥81.40 and first target equidistant. Trying to avoid the scenario. A correction in the US-Japan two-year bond yield spread – a
focus on some more critical resistance at Ca$1.0675. Ultimately, only volatile influences of risk appetite somewhat, a potential Aussie- major driver of dollar-yen in recent months – following the Fed’s QE2
a close back below Ca$0.9970 would give reason for concern. Target Canadian dollar break below Ca$0.99 could complete a nice reversal pat- announcement is the fundamental catalyst. I will go long, targeting
Ca$1.0600 and put a stop at Ca$0.9890. tern and encourage a short with a 100 point stop and first target. ¥85.87. A stop-loss will be activated on a daily close below ¥81.72.
City Focus
28 CITYA.M. 17 NOVEMBER 2010
| Law
Office jokes
Six ways to prepare yourself are here to
for the UK’s new Bribery Act stay, legally
Guidelines are out in
the open and it’s time
to start making sure
you are covered
BEN STEPNEY
T
HE Equality Act arrived with a fanfare
last month and was broadly welcomed
for clarifying existing discrepancies with-
in employment laws. But some employers
are concerned that the new Act could make it
easier for disgruntled members of staff who are
offended by office jokes to take their employer
OMAR QURESHI to an employment tribunal. So does this spell
the end of office jokes?
There are several key concepts in the new Act.
B
USINESSES are concerned that they Firstly, “associative discrimination”. This means
will have little time to meet the that an employee does not have to be, for
demands of the Bribery Act when its example, gay or of an ethnic minority to be
offences come into force next year. protected. For instance, an employee who has
If they wait for the government’s guid- a disabled child and is subjected to degrading
ance on “adequate procedures” to be pub- or humiliating comments about disabled peo-
lished, it may be too late to make the ple is protected. Here the employee concerned
required adjustments. has been discriminated against because of the
When the Bribery Act offences come disability of a person they associate with. Also,
into force in April 2011, a corporate entity an employee also does not need to be the sub-
will be automatically criminally liable if ject of the joke to be protected. So a female
anyone performing services for it any- employee who shares an office with male col-
where in the world bribes to win or keep leagues who are verbally abusing another
business for it. Employees, subsidiaries ment don’t really believe in it, it’s not Bribery will be harder chose not to apply all of them. female colleague on the grounds of her
and even foreign agents can make a UK going to happen. Second, there must be when the new Act The MoJ also published “illustrative sce- gender is protected if this creates a
company liable to unlimited fines, even if risk-assessment of the business, knowing comes in to force narios” covering key areas of concern, working environment that is intimidating or
management knew nothing about it. UK and keeping up to date with bribery risks including intermediaries, joint ventures humiliating for her.
companies will be expected to make sure you face in your sector and market. Third, Picture: GETTY and hospitality. Unfortunately, they offer Then there is the idea of third party harass-
they know what is being done on their due diligence should be carried out on few answers and raise new questions: how ment, which protects employees who are con-
behalf and to police it. agents, business partners and even staff to much less is expected of small and medi- tinually harassed by a third party, for example
The only defence is having adequate ensure they have the expertise required um sized companies? The scenarios sug- a customer. Such an employee can now com-
procedures designed to prevent bribery, with no conflicting interests and are paid gest the bar is still very high. We will have plain to a tribunal if the employer is aware of
and the government’s guidance is sup- no more than is fair. to see what the courts make of these sce- this and takes no steps do deal with it.
posed to help business understand what Fourth, businesses must set out clear, narios, which are not part of the guidance. So where does this leave office jokes?
this requires. The Ministry of Justice (MoJ) practical and accessible policies and proce- In the meantime, businesses should Employers need to be aware of the effect that
has just completed its consultation on the dures so that everyone acting on its behalf review industry guidance and assume the banter has on their staff and ensure that they
guidance, and while the final version will knows what is acceptable and how to deal MoJ guidance will not change. The FSA’s take the relevant action if they deem actions
be published in the new year, the draft with any issues. Fifth, there should be recent report on corruption in commer- or statements to be creating an intimidating,
makes interesting reading. Only when the effective implementation of the policies cial insurance broking is also recommend- hostile or humiliating environment for employ-
first cases are prosecuted through the and procedures: “this is about going ed reading whatever your business. It ees. The fact is that much of the Act simply
courts will matters become clear, but beyond ‘paper compliance’ to embedding offers the best insight we have of how the repeats existing law – it remains unlawful for
there are already some obvious steps that anti-bribery in your organisation’s inter- authorities may assess “adequate proce- an employer to discriminate or harass an
businesses should be taking. nal controls, recruitment and remunera- dures”. Developing anti-bribery proce- employee in respect of a protected character-
The MoJ’s draft guidance is “not pre- tion policies, operations, communications dures is not simple and takes time if you istic and an employer is still liable for the acts
scriptive and is not a one-size-fits-all docu- and training on practical business issues,” really want procedures that are “ade- of its employees while at work.
ment” – in other words, the guidance says the document. Finally, there must be quate”: you can’t buy an off-the-shelf prod- There is still a gap between banter or joking
won’t tell you the answer. Instead, it sets monitoring and review to help ensure the uct. Those that haven’t already got their and discrimination or harassment. Banning
out Six Principles for Bribery Prevention procedures are working. Importantly, procedures in place should start working office jokes – if it were possible – would not be
that businesses can consider applying. none of the principles are obligatory, but on them now. a proportionate response to the Act.
First, it demands a “top level commit- persuading a court that your procedures Omar Qureshi is a partner at CMS Cameron Ben Stepney is a solicitor in the Employment
ment” to eradicating bribery: if manage- are “adequate” may be difficult if you McKenna Team at Thomson Snell & Passmore
Picture: Micha
Theiner/ City A.M.
CV | MARLON ABELA
M
ARLON Abela fits the internation- he was more than happy to chat about life, small plates – you can have three courses [places like] Mahiki, I think Mayfair is very
al It-Boy bill perfectly. Born in love and the universe, he said he actually for £19. You get the sense that he has a truly elegant.” Faddishness bores him: “There
Lebanon, he grew up among the bought “a few things”. Not quite hoi polloi, personal connection with this one. “I’ve will always be fads in London, New York
rich and famous of London and then. always loved Provencal food,” he says. “I and Paris. But those restaurants don’t con-
the south of France, raised by a father who Unlike many in his set, Abela seems a grew up around there and it’s very pure. It cern me.”
owned one of the world’s top institutional substantial person. One is struck by the fact uses the most beautiful ingredients in the Now is MARC’s golden era because we,
and airline catering businesses and a slew that he can’t help but be himself – a perfec- world. Think of the cheese, the boullabaise. the restaurant-goer, are ready. “At the end
of four and five star hotels. Recently valued tionist more than a bon vivant; a thinking, It’s the type of cuisine I love. And it should of the day, the diner has never been more
at £400m, Abela was coiffing the best wines hard-working foodie rather than a mask of work very well in London.” sophisticated. I want them to walk away
on earth and supping the best food on the moneyed international manners. He is a Abela is a stickler for location, which is and say ‘Wow’”. Thanks to those four-hour
planet when most boys are downing cider person who values quality – almost to the why he hasn’t expanded at the speed you nights, we’re doing just that. Cassis opens 25
in the bushes. point of insomniac neurosis. “I only sleep might expect. Before the recession, there Nov. www.cassisbistro.co.uk.
With family millions behind him, he was four hours a night,” he says, and you can
able to set up on his own in his late twen- believe it – he has a slightly restless air and
ties, bypassing anything as dreary as the it’s not hard to imagine him being easily A VOCE, NEW YORK With two GREENHOUSE, MAYFAIR A huge, wine
middle-ground and heading straight for a disturbed by the thought of an imperfec- prime spots list, impecca-
Michelin star-dusted empire MARC (Marlon tion. It’s this obsession with the best that at Columbus ble food and a
Abela Restaurant Corporation), that has has led his Michelin-starred Japanese Circle and celebrity fol-
provided London with three of its best restaurant Umu to have the UK’s largest Madison Ave, lowing have
restaurants. Now divorced, he dates a sake list, and his Michelin-starred restau- A Voce serves ensured this
Burberry model, invests in wine and col- rant the Greenhouse to have the largest elegant Mayfair
lects art for personal use and for his restau- wine list in Britain (this extraordinary wine Italian for the restaurant’s
rants. It doesn’t get more jet-set It-Boy than emphasis is “both passion and shrewd busi- well-heeled. success.
that, does it? ness”). And although his restaurants
But Abela the man – rather than the Rich remained busy throughout the recession, FOUR OF THE STARS IN MARC’S EMPIRE
List entity – is a very different sum of his they have been completely flying since –
parts than you might expect. In person he “it’s been a phenomenal year”. Morton’s
is serious and polite, with a curious has a new nightclub downstairs; Umu had Abela’s MORTON’S, MAYFAIR Said to be the UMU, MAYFAIR
German-sounding accent, pale brown eyes a new lounge put in and in New York, Abela attempts to only Kyoto-
and curly hair hinting at his Middle Eastern has just launched FPB, a chocolaterie and make this style restau-
origins. member’s club rant in the
less stuffy UK, Umu
After our interview at Morton’s, the
members club on Berkeley Square that he Abela the man – rather than the Rich have culmi- serves bril-
nated in a liant food and
now owns (and has turned into a bastion of
fine dining and fine art – a dinner I had List entity – is a very different sum of new nightclub has a great
there recently left me speechless), I saw
Abela at Frieze Art Fair. Rather than his parts than you might expect downstairs. sake list.
30 Lifestyle | Motoring WORDS BY
RYAN BORROFF
CITYA.M. 17 NOVEMBER 2010
Die-hard Land
Rover fans may take
issue with this on-
roader. But they’d
be missing out
S
O HERE I am, driving the first
mass-produced Land Rover ever to
be designed not to go off road – the
Freelander 2 eD4 – and where I
am driving it? Off-road. For a second
I can’t help myself from thinking
that Land Rover’s communica-
tions people have gone mad.
Then I realise two things.
First, it is actually very good.
Not four-wheel drive good
but far more capable than I
could have ever expected,
and more capable than
some rival 4WD soft-road-
ers. Second, I’m actually
really enjoying the drive. It’s
a lot of fun in a “you’ve just
got to grit your teeth and go
for it” kind of a way.
Making our way up some
steep and deep ruts off-road
somewhere in Spain involves
flooring the car to maximise
its momentum, because if the
car doesn’t make it, there’s no choice
but to roll back down and start again.
This is not the usual way that one expects
to make progress off-roading in a Land
Rover, to say the least.
Which is why this two-wheel-drive
Freelander 2 eD4 has upset so many Land
Rover faithful. Yet there’s no doubt that
introducing two-wheel drive versions of
its cars is vital to the future of its brand.
Land Rover knows that 2WD soft-roader
SUV sales are up as people choose to buy
cars with an SUV shape and commanding
driving position, but which offer better
fuel economy. What’s more, such cars are
a big statement and a definite step in the
right direction from an environmental
perspective. equivalent. I thing this must be down to
The Freelander 2 eD4 is driven only by its lower weight, a drop of 75kg on the THE FACTS:
the front wheels. This means the car is 4WD model. It’s a car that I like more the LAND ROVER
the most efficient Land Rover ever. Its 2.2- longer I’m with it and for the first time I FREELANDER 2 ED4
litre turbo diesel engine is frugal indeed, completely understand why someone
returning 47.2mpg and emitting just might want to drive an SUV, even if they PRICE: £22,000
158g/km of CO2 – helped by its stop-start have no intention of going off-road in it. 0-62MPH: 10.9 secs
system. Not bad for an SUV, even a soft Yet despite all this, this two-wheel TOP SPEED: 112mph
one. This means that the car is cheaper to drive Freelander eD4 is most surprising
run and, thanks to its asking price, it’s off-road. Because it has the same high CO2 G/KM: 158g/km
also cheaper to buy than the regular ground clearance and suspension travel MPG COMBINED: 47.2 mpg
Freelander 2. as the more regular 4WD version, the car
On-road, the car feels surprisingly does astonishingly well. With a little THE VERDICT:
capable and it is incredibly easy to drive. oomph to help it up the hills, it feels like DESIGN hhhii
The high-up driving position offers a old school off-roading before technology PERFORMANCE hhhii
commanding view, so one feels incredi- made off-roaders so efficiently capable. PRACTICALITY hhhii
bly safe. With a top speed of 112mph and This is no bad thing because I suspect VALUE FOR MONEY hhhii
a 0-60mph time of 10.9 seconds, the 150ps there are some Landy faithfuls that may,
engine feels sprightly enough at speed, after driving it, have to admit that it’s tomers to the brand, because the eD4
and though the steering is a little light, really rather good, even if they do so feels like a premium car without the
the Freelander eD4 feels slightly better begrudgingly. And when all is said and price tag that usually goes with it. And
on the motorway to me than its 4WD done, it’s going to attract a lot of new cus- what can be wrong with that?
THE CONTROVERSIAL RANGE ROVER EVOQUE T.25 CITY CAR DEBUTS FIRST PEEK OF ASTON MARTIN’S CYGNET
If the new 2WD Freelander is contentious, it’s nothing on the controversy Gordon Murray Design’s T.25 city car has made its first on-road debut Aston Martin’s controversial city car is currently making its global debut
that surrounds the new Range Rover Evoque. This is the production five- during the inaugural Brighton to London Future Car Challenge. The light- in Harrods’ Brompton Road window display. It’s the first time the com-
door version, which is making its debut at the Los Angeles Motor Show weight car won both “Most Economic Small Passenger ICE Vehicle” and pact, luxurious, two-door Aston has been seen in production guise. The
today. The Evoque will be the smallest, lightest and most fuel-efficient “Most Economic and Environment Friendly Small Passenger ICE Vehicle” Cygnet can seat four people and can be trimmed to each customer’s indi-
Range Rover ever made when it goes into production in the summer next using a conventional petrol engine. It achieved a massive 96mpg, beating vidual requirements. It will be at Harrods until Saturday 11 December
year. Thanks to its coupé form it will also be the coolest and best looking. competitor vehicles powered by diesel engines. and production begins next year.
CITYA.M. 17 NOVEMBER 2010 Lifestyle | TV& Games 31
SKY SPORTS 1 4.30am European Tour Weekly 3am Charmed 4.40am HISTORY DISCOVERY HOME &
SATELLITE & CABLE
7pm Sky Sports News at 5am-6am Live European Tour Exposed: Britney Spears
Seven 7.30pm Live Golf: The Hong Kong Open. 5.30am-6am Home Shopping
7pm How the Earth Was Made HEALTH
8pm Ancient Aliens: Historical 7pm Babes in the Wood 8pm
International Football 10pm
You’re on Sky Sports! 11pm- BRITISH EUROSPORT BBC THREE evidence of potential alien
landings. 10pm Britain’s X Files
10 Years Younger 9pm
6.40pm US Tour Golf 7.40pm 7pm Radio 1 Teen Awards Emergency 10pm Hospital
7.30am Live International 11pm Decoding the Past 12am
Cricket European Tour Golf 8.10pm Golf 8pm Mad About the House Sydney 11.30pm The Real ER ANIMAL MADHOUSE
Club 8.15pm Sailing 8.45pm 9pm Children in Need 10.55pm Ancient Aliens 2am Tunnellers 12am Emergency 1am Hospital CHANNEL 4, 8PM
3am Mega Disasters 4am-
SKY SPORTS 2 Yacht Club 9pm WATTS Family Guy 11.40pm Lip
5am Ancient Discoveries
Sydney 2.30am The Real ER Vets treat sick animals with the help of
7pm Football Asia 7.30pm Live 10.05pm Test Cricket 12.05am- Service 12.40am Mad About 3am 10 Years Younger 4am nurses Gemma Boughey and Catherine
12.35am Alpine Skiing the House 1.40am Russell Multiple Mums 5am From Here
International Football 10pm
Howard’s Good News 2.10am
DISCOVERY to Maternity 5.30am-6am
McVeigh, including an elephant
Transworld Sport: Action and 8pm How Do They Do It? undergoing a pregnancy ultrasound.
features. 11pm FIFA Futbol ESPN Children in Need: 50 Greatest Portland Babies
7pm ESPN Kicks Extra 7.15pm 8.30pm How It’s Made: How
Mundial 11.30pm Total Rugby Moments 4.05am-5.05am
12am International Football ESPN Serie A Kicks 7.30pm Radio 1 Teen Awards
peanut butter is made. 9pm SKY1
Live International Football Did the Mob Kill JFK? 10pm 8pm The Little Couple 8.30pm
2am Total Rugby 2.30am
You’re on Sky Sports! 3.30am- 9.30pm Ski World Cup Report E4 Ultimate Air Jaws 11pm Emergency Animal Rescue
5.30am International Football 10pm 30 for 30 11pm Poker 7pm Hollyoaks 7.30pm Friends Frontline Battle Machines with 9pm FILM The Legend of
12am Live NBA Basketball 9pm Ugly Betty 10pm Mike Brewer 12am Deadliest Bagger Vance: Drama, starring
SKY SPORTS 3 2.30am-5am Live NHL Ice Desperate Housewives 11pm Catch 1am Bear Grylls: Born Will Smith and Matt Damon.
7pm Ladies European Tour Golf Hockey Natalie Cassidy 12am RuPaul’s Survivor 2am Rory McGrath’s 2000. 11.25pm UK Border
8pm International Cricket Drag Race 1am Scrubs 1.50am Best of British Engineering Force 12.25am Inside Britain’s
10pm DTM Motor Racing LIVING Natalie Cassidy: Becoming 3am World War Two: The Fattest Man 1.25am Road Wars LAW & ORDER: CRIMINAL INTENT
11pm Golfing World: Magazine 7pm CSI: Miami 8pm Four Mum 2.45am RuPaul’s Drag Complete History 3.50am 2.15am Ross Kemp on Gangs CHANNEL FIVE, 10PM
show. 12am Inside the PGA Weddings 9pm Ghost Race 3.30am Reno 911! Special Forces Heroes 4.40am 3.05am Oops TV 3.30am Lost A magician disappears during a live-
Tour 12.30am Ladies European Whisperer 10pm Criminal 3.50am Switched 4.15am Mystery Investigator: Olly 4.20am Sell Me the Answer burial trick and is later found dead
Tour Golf 1.30am Golf 3.30am Minds 1am CSI: Miami Accidentally on Purpose Steeds 5.30am-6am How 5.10am-6am Are You Smarter miles away from the location of his
Ladies European Tour Golf 2am Four Weddings US 4.35am-6am Switched Does That Work? Than a 10 Year Old? performance. With Vincent D’Onofrio.
COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
QUICK CROSSWORD
SUDOKU KAKURO
28 12 42 16 8 29 9
12 22 16
20
8 32
Place the numbers from 1 to 9 in each empty cell so that each 20
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 10 6
15 7
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 35 21
above or to the left of it. 30
13 6
You can only use the digits 1-9
and you must not use the
19 24 30
45
same digit twice in a block.
The same digit may occur 3 15
10 27 11
more than once in a row or
column, but it must be in a
24
23
16
separate block.
5
9
6
29
33 11
4 13 8
ACROSS DOWN
1 Decorative ruffle (5) 1 Signboard, for
WORDWHEEL A K
4 Annoyed (5)
7 Framework that
example, bearing a
shopkeeper’s name (6)
2 In an artificial
Using only the letters in the Wordwheel, you have supports climbing
ten minutes to find as many words as possible,
T E plants (7) environment
outside the living
8 Pieces of potato fried
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters T in deep fat or oil (5)
organism (2,5)
3 Momentary failure (5)
LAST ISSUE’S or more, all must contain the central letter and
letters can only be used once in every word. There
I A 10 Formal exposition (8)
13 Land measure (4)
5 Woman’s loose
SOLUTIONS KAKURO is at least one nine-letter word in the wheel.
V L 15 Clothing (4)
dressing gown (8)
6 Hair curler (6)
QUICK CROSSWORD 17 Person who owns a 9 Make-believe (8)
SUDOKU
8 6 1 8 2 2 1
guest-house (8)
7 9 8 5 6 3 7 9 11 Be unwell (3)
7 : 2 7 , 0 , 1 *
5 3 1 9 5 8 6 7
19 Holy city (5)
& + 2 $ 2 3 12 Caustic remark (7)
$ 9 ( 5 7 * 2 2 6 ( 9 8 6 4 1 2 3
20 The gathering together
/ $ ( / 0 1 1 2 1 5 7 4 9
of livestock (5-2) 14 Select (6)
, 6 / $ 0 $ 7 ( 8 3 4 3 5 2 9 7 6 1 8
16 Cup without a
%
5
5
, 6 . < $
$
% < 6
8
6
1 2 3
1 4 2
8 1 4
2 1 6 3
WORDWHEEL
21 Mechanical bar (5)
22 Large-eyed, arboreal
handle (6)
$ , ( / ) $ +
7 2 1 * $ 7 , / ' ( 6 7 9 4 8 9 8 7 The nine-letter word prosimian having 18 Urge or force to
1 4 1 6 4 5 7 2
( & 6 ( 7 5
was SUNFLOWER a foxy face (5) an action (5)
< ( 6 7 ( 5 ' $ < 9 5 3 4 5 9 1
Sport
32 CITYA.M. 17 NOVEMBER 2010
Results
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▲
SPORT | IN BRIEF
South Africa coach plays down crisis
as Habana injury adds to doping row
England 2018 bid gets Fifa boost Villarreal and was training with the
FOOTBALL: England’s hopes of hosting Gunners earlier in the season in a bid to
the 2018 World Cup will be boosted by regain his fitness. Villa’s assistant manag-
the publication of Fifa’s technical reports, er Gary McAllister said: “It’s perfect. He’s
which will categorise the bid as a low a player everyone can look up to because
legal risk with a high potential financial of what he has achieved in the past with
▲
return. Karren Brady, the West Ham Arsenal.” RUGBY UNION risk. But yesterday, as he named his tour, which ends with a fixture
United vice-chair who is also head of the BY FRANK DALLERES team, the coach tried to play down against England on 27
2018 advisory board, said yesterday the Gayle puts Windies in command the controversy that has engulfed November.
publication of the reports should help CRICKET: West Indies batsman Chris SOUTH AFRICA coach Peter de Villiers the world champions. Habana broke a bone in his
England’s bid refocus attention on its Gayle entered the record books on day has attempted to draw a line under “We have moved on, we’re hand during training when
strong fundamentals. She said: “Our hope two of the first Test with Sri Lanka by the doping storm that has derailed professional, we know how he fell awkwardly in a defen-
is that the executive committee’s vote is hitting 333. Gayle became only the preparations for Saturday’s clash to deal with tough sive drill, enforcing one of
based purely around sporting credentials. fourth player in history to register a sec- with Scotland. moments and we look for- four changes to the team for
If that is the case, we know we have a ond triple-hundred, matching the feat of The Springboks lost two men on ward to playing the game the Scotland Test.
very strong chance. If it is based solely Australian Don Bradman, fellow West Monday when hooker Chiliboy on Saturday,” said De Lwazi Mvovo will replace
on that, we should win on 2 December.” Indian Brian Lara and Virender Sehwag, Ralepelle and winger Bjorn Basson Villiers. “We have sent a lot Habana, while full-back
of India. The opener’s score helped the were sent home after testing positive of stuff for testing. We don’t Zane Kirchner, scrum-
Former Gunner Pires joins Villa Windies reach 580-9 declared in their for a banned stimulant. want to repeat it.” half Francois
FOOTBALL: Aston Villa have confirmed first innings, with Sri Lanka reaching De Villiers admitted then he feared De Villiers was dealt a fur- Hougaard and No8
the signing of 37-year-old former Arsenal 54-1. Elsewhere, Younus Khan hit an his whole squad could have taken the ther blow yesterday when Ryan Kankowski all come
star Robert Pires on a free transfer. Pires unbeaten 131 as South Africa and same substance as part of a nutrition- winger Bryan Habana was into the team. Gio Aplon
had been released in the summer by Pakistan drew the first Test in Dubai. al supplement, and were therefore at ruled out of the rest of the switches to the wing.
34 Sport | Football CITYA.M. 17 NOVEMBER 2010
Court D-Day
PIK loans
losses, down from
£7.7m
PIK pay-off but big
FOOTBALL FINANCE
last year questions remain
▲
is standing by to act as administrator FOOTBALL FINANCE them to calm down. Obviously, the
to Sheffield Wednesday today if a BY FRANK DALLERES AND JAMES GOLDMAN Wayne Rooney contract situation
High Court case verdict goes against meant the heat has been kept right on
the club. MANCHESTER UNITED supporters them and this news has to be seen as a
Wednesday face a £600,000 have hailed the Glazer family’s deci- victory and a step in the right direc-
demand from the tax authorities and sion to pay off £220m of costly pay- tion.
arrive in court after the board turned ment-in-kind loans (PIK), removing a “It’s time now for the Glazers to
down an offer from Leicester City potential drain on the indebted club’s reveal their plans, show some trans-
chairman Milan Mandaric. resources, as a victory for fans. parency and give the fans the assur-
According to sources close to the But they have urged the Glazers to ances they’re after. It’s certainly not
talks, former England and Leeds man- show greater transparency in their celebration time though. We still
ager and current club chairman running of the Premier League outfit. don’t know exactly where the money
Howard Wilkinson was one of the United said yesterday no money had to pay off this loan has come from.”
toughest critics of an offer for the been taken from the club to pay off United responded to fevered debate
club from Mandaric that would have the loans, but mystery remains over over how the Glazers would fund the
seen Wednesday’s creditors repaid a how the Americans funded the move. move by releasing a brief statement
proportion of their debts. The move comes after months of denying money had been taken from
Another vocal critic of the pro- unrest among fans worried that more the club. It read: “The board notes
posed deal was Wednesday’s ex- chair- than £700m of debt had started to recent press speculation. The board
man Dave Allen who described make United uncompetitive, a fear can confirm that there has been no
Mandaric’s offer as “derisory”. heightened by wrangling over dividend of club cash.”
Today the club faces the possibility Wayne Rooney’s new con- The remaining options would
of falling into administration – and tract. A mooted takeover bid appear to be that they have either sold
£1.6bn
having an automatic 10 point deduc- by the wealthy consortium a stake in the club, or taken another
£509.4m
tion – unless it pays its tax bill. the Red Knights abated, loan at a better rate than the 16.25 per
The Co-Op Bank, the largest credi- but season ticket sales suf- cent payable on the PIK.
tor with around £23m outstanding, fered. News of the move came as United
was said to support the Mandaric Duncan Drasdo, a released quarterly figures showing a
offer. Mandaric is still chairman of
Estimated wealth Man Utd's spokesman from the drop in losses compared to the same
Leicester City but he has sold that
debt Manchester United period last year, from £7.7m to £4.9m.
club and would have left his position
there to join Wednesday if his bid had
been successful.
of Glazer family Supporters’ Trust (MUST),
told City A.M.: “It certainly
shows that the supporters have
United’s debts now stand at £509.4m,
with a cash balance of £151.7m accord-
ing to the figures, which run up to the
Mandaric said last night he hoped been rewarded and the message to end of September.
Wednesday “have a plan B” to fall them has to be to keep the pressure on The Glazers, who also own NFL fran-
back on in order to stave off adminis- the owners. chise the Tampa Bay Buccaneers, had
tration. Zolfo Cooper was founded in “It seemed as if the Glazers were their wealth estimated at £1.6bn by
2008 after a buyout of Kroll. United fans have asked for greater transparency from the Glazers Picture: GETTY just waiting for the animosity towards Forbes magazine two months ago.
CITYA.M. 17 NOVEMBER 2010 Sport | Football 35
▲
PREMIER LEAGUE
BY JAMES GOLDMAN
CHELSEA’S defensive crisis deepened
Jackie Milburn was the prototype yesterday when the club announced
Newcastle No9. He only won 13 centre-half Alex will miss up to eight
caps but scored 10 goals. weeks with an ongoing knee injury.
The Brazilian international has
already been absent from the Blues’
last two Premier League fixtures
against Fulham and Sunderland
because of the problem, although he
had linked up with Brazil for this
evening’s friendly in Qatar.
A club statement read: “Further to
the Chelsea medical team’s diagnosis,
the Brazilian national team doctors
agree that further investigation via
Malcolm MacDonald won 14 caps arthroscopic surgery is required on
and is best remembered for scoring the player’s right knee. That will take
five times on debut against Cyprus. place over the coming days. He is Alex could miss up to eight weeks with a knee injury. Picture: ACTION IMAGES
expected to be out for approximately
six to eight weeks.” heart of the champions’ defence any in his right leg,” said the spokesman.
It is now likely that Alex and club time soon. Terry’s injury is a blow to country
captain John Terry, who yesterday A Chelsea spokesman yesterday as well as club, but England boss
revealed he could be out for months confirmed that 29-year-old Terry Fabio Capello has backed his former
with a nerve injury in his right leg would continue to receive expert captain’s decision to change his poli-
which has troubled him since the end medical care in the search for a per- cy of playing through the pain barri-
of last season, will miss the entirety manent cure. er.
of a tricky looking December sched- “John Terry reported for training “It is a good decision,” said Capello.
ule which includes matches against yesterday morning. “He has played a lot of games with an
Arsenal, Manchester United and “He met with club doctors and injection.
Alan Shearer, the Toon’s all-time Tottenham. medical team and discussed plans to “I spoke with him a few times and
leading scorer, led the nation’s line The pair missed Sunday’s drubbing continue seeing various specialists to asked him whether he was fit to play.
for eight years scoring 30 goals. at the hands of Sunderland and it try to find a solution to the nerve You can’t play with injections all the
appears they won’t be reunited at the problems he has been experiencing time. It is impossible.”
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