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Economics
Factory output: British factory output contracted for a sixth
consecutive month in October, although the pace of decline slowed slightly.
The Chartered Institute of Purchasing and Supply/Markit said its purchasing
managers’ index edged up to 41.5 in October from 41.2 in September. Any
figure below 50 indicates contraction.
UK jobless figures: Unemployment in the UK will jump to 7.1 per cent
next year, from 5.7 per cent at present, according to a forecast by the
European Commission. It also gave warning that the European economy is
likely to “grind to a standstill”, with the 15-nation bloc tipping into
recession for three quarters, starting in the second quarter of this year.
It said EU growth will more than halve to 1.4 per cent this year and plunge
to just 0.2 per cent in 2009.
Eurozone manufacturing: Activity fell to a record low in October. The
Markit Eurozone Purchasing Managers Index for the manufacturing sector
slumped to 41.1, the lowest in the survey’s 11-year history, from
September’s 45.0. Any figure below 50 indicates contraction. This is the
fifth consecutive month the PMI index has been below the 50 mark that
divides growth from contraction.
US factory: Activity fell again in October. The Institute for Supply
Management said its manufacturing index fell to 38.9 in October from 43.5 in
September. Any figures below 50 indicates contraction. Economists had
expected a reading of 41.5.
Banking
& finance
Lloyds TSB: The British bank is in talks with sovereign wealth funds
and UK insurance groups about selling stakes in a merged Lloyds-HBOS group
with a preliminary deal expected by January. Lloyds intends to use the cash
to help to redeem £4 billion of government preference shares in Lloyds and
HBOS in order to allow the bank’s board to to re-start dividend payments in
2009. It added that a merged Lloyds-HBOS group will be called Lloyds Banking
Group.
UK Financial Investments: The Government has created a company that
will manage its investments in the three high street banks that it bailed
out last month. UK Financial Investments Limited will be run by John
Kingman, the Treasury official who handled the nationalisations of Northern
Rock and Bradford & Bingley and the bank bailouts.
Skipton Building Society: The building society is to merge with
Scarborough Building Society after being approached by its smaller rival.
The deal should be completed by the first quarter of next year and will
create a societywith about 860,000 members and £16 billion of assets.
Société Générale: France’s second-largest bank
revealed an 84 per cent fall in third-quarter profits after taking a €1.2
billion (£950 million) hit from the collapse of Lehman Brothers and the
global financial turmoil. Net profit fell to €183 million in the three
months to September 30, because of a €244 million loss at its investment
banking division.
Spanish mortgages: Spain became the first European country to introduce
a mortgage moratorium for the unemployed in a move that could put pressure
on others to follow suit.
Goldman Sachs: The American bank is on course to report its first
quarterly loss since floating nearly a decade ago, according to a leading US
analyst. Guy Moszkowski, an analyst at Merrill Lynch, reduced his forecast
for Goldman’s fourth-quarter profit from $2.98 per share, or $1.3 billion
(£822 million), profit, to 49 cents per share, or $216 million, loss.
HSBC: The bank will pay an interim dividend of $0.18 per share for the
third quarter. The dividend will be paid on January 14 next year and will be
available in US or Hong Kong dollars or sterling.
Kohlberg Kravis Roberts (KKR): The US private equity investor has
postponed its flotation until 2009 after its Amsterdam- listed fund suffered
losses. KKR had said in July that it would merge with its subsidiary KKR
Private Equity Investors and float on the New York Stock Exchange by the end
of this year.
GMAC: The finance company has sold the reinsurance operations of its
GMAC Insurance subsidiary to Maiden Holdings. To help to fund the
transaction, Maiden plans to raise $260 million of equity from a rights
offering to shareholders. After the transaction, Maiden said it will have at
least $1 billion of annual written premiumsGMAC Re has been renamed Maiden
Re.
Commerzbank: The German bank swung to a net loss of €285 million for
the three months to September 30, down from a profit of €339 million in the
same period last year. The second-largest bank in Germany by assets said it
would get a €8.2 billion credit line from the Government’s stabili-sation
fund. The deal, called a “silent participation”, does not give the State a
stake in the bank.
Construction
& property
Kenmore Property Group: The fund manager has formed an alliance with
Watan Investments, the Saudi Arabian banking group. Kenmore and Watan said
that they hoped that the alliance would lead to the launch of a new Gulf
property fund and provide a platform for Kenmore to extend asset and
development management services into Saudi Arabia.
Consumer
goods
Diageo: The drinks group is to unveil a £25 million promotional
campaign for Baileys — its biggest investment in the cream liquor brand.
PepsiCo: The US-based food and beverage company is to invest $1billion
(£631 million) in China over the next four years, as part of its strategy to
expand in emerging markets. It will expand manufacturing capacity in China,
particularly in interior and western areas.
Engineering
Car sales: General Motors, Ford and Toyota reported dire sales for last
month. General Motors sales crashed 45 per cent while Ford’s sales fell 30
per cent compared with the same month last year. Toyota fared slightly
better but still suffered a drop of 26 per cent.
Strike: More than 45,000 metal and electronics workers went on strike
across Germany in an escalation of industrial action over an 8 per cent pay
claim. IG Metall, the giant union, co-ordinated the walkouts, which affected
more than 160 factories.
Chloride: The power protection specialist said a record order book of
£124 million underpinned prospects. Shares in the group, which provides
blue-chip companies with systems to protect against power outages, jumped 10
per cent after it revealed the 21 per cent improvement in its order book.
Hamworthy: The designer of marine, onshore and offshore fluid handling
systems, has completed the acquisition of 79 per cent of Baltic Design
Centre, a Polish ship design business, for £500,000.
Health
ProStrakan: The drugs company has launched Sancuso, its patch for
chemotherapy patients, in the US. Analysts expect it to achieve sales of
about $100 million (£63 million) per annum, doubling ProStrakan’s current
revenues.
Industrials
BASF: The German chemicals group said it had secured 68.10 per cent of
Ciba’s shares, based on final results of a tender for its ailing Swiss
rival, clearing the key hurdle in the takeover bid.
Leisure
Trump resort: The Scottish Government has granted outline planning
consent for Donald Trump’s controversial £500 million golf resort in
Aberdeenshire after deciding there would be significant economic and social
benefits. The application includes two golf courses, a 450-room hotel and
conference centre, almost 1,000 holiday apartments and villas and 500
houses.
Rezidor Hotel Group: The Scandinavian operator behind the Radisson
brand reported a slowdown in third-quarter trading because of the economic
downturn and the financial turmoil. Revenue per available room fell by 0.4
per cent on a like-for-like basis while occupancy fell from 76.2 per cent to
71.4 per cent.
Kew Green Hotels: The mid- market operator backed by Moorfield Group
and HBOS has defied the credit crunch to complete a £140 million refinancing
through a syndicate of banks led by Bank of Scotland Integrated Finance,
Barclays and Lloyds TSB.
Merlin Entertainments Group: The visitor attractions operator is to
start work on a £5 million revamp of the recently acquired London Aquarium.
YO! Sushi: The conveyor-belt restaurant chain backed by Quilvest
Private Equity has opened its 50th outlet, at the Westfield shopping centre
in West London, and plans to open a further 50 by 2012.
Media
Independent News and Media: The newspaper group is to sell its 39.1 per
cent stake in APN, the owner of the New Zealand Herald and regional
newspapers and radio stations in Australia. It denied it was to sell The
Independent in London to the owner of the Daily Mail.
Virgin Media: The group has won approval from its banks to postpone
repayments on its £4.3 billion debt burden until 2012, giving it an extra
three years in which to refinance its loans.
Natural
resources
Lonmin: The world’s No 3 platinum producer told trade unions of
possible job cuts because of a big drop in demand for the metal from car
makers, South Africa’s Solidarity union said. Jaco Kleynhans, the union
spokesman, also quoted Lonmin as saying in a letter that it would present a
revised structure of a “more effective and smaller Lonmin” to its employees.
Serabi Mining: The mining company said it was in talks, with regard to
a takeover or sale of its assets with a number of third parties.
Goldplat: The AIM-quoted gold producer said trading in its first
quarter has continued to be buoyant and that it was on target to be
producing gold before the end of 2008 at its Kilimapesa project in Kenya.
Retailing
Debenhams: The managing director of the high street retail group is
leaving after just nine months in the job. Angela Spindler will go at the
end of November in a board shake-up. The chain, which last month cut its
dividend and said like-for-like sales fell 4.2 per cent in September and the
first half of October, has transferred Michael Sharp, its chief operating
officer, to the new position of deputy chief executive.
Support
Services
WSP: The design and engineering consultant is on track to meet
expectations, with all regions at or ahead of target. The London-based
company remains “vigilant” to the impact of the economic downturn but is
confident a spread of services across many markets will underpin
performance.
Technology
MySpace: A new technology that allows television programme makers to
profit from piracy is to be launched by MySpace, the social networking site,
and MTV Networks.
Tiscali:The broadband provider confirmed talks about selling its UK
business to BSkyB, the broadcasting giant. Tiscali has 1.8 million broadband
customers in the UK — making it the fourth largest player — although its
market share is believed to have come under pressure.
Intelek: The Swindon-based communications and aerospace specialist said
a strong performance in the year to 31 March has continued into the current
financial year, with growth in sales and orders. It has opened new offices
in South-East Asia and China.
Telecoms
Vodafone: Shares in the mobile phone group tumbled 7 per cent to 110p
amid fears that it could issue a profits warning. It is due to release its
half-year results next week. Other companies, including BT, have issued
warnings.
Transport
Ryanair: Europe’s largest airline has pledged to cut fares by up to 20
per cent this winter as the economic downturn reduces consumer demand for
travel. The Irish budget airline reported a 47 per cent fall in profits
during the first six months of the year and is bracing itself for loss in
the second half as passengers rein in their spending.
Utilities
Scottish & Southern Energy (SSE): The energy company has sold a 50
per cent stake in its Thames Estuary wind farm scheme in a deal worth £308
million. SSE, which acquired 100 per cent of the Greater Gabbard Offshore
Winds venture this year, is selling the stake to npower renewables, part of
RWE, the energy group.
Centrica: The British Gas owner, through its British Gas Business
division, has reached agreement to acquire the 40,000 customers of
BizzEnergy for £3.5 million after the privately-owned energy supplier was
taken into administrative receivership.
