Economics
Tax appeal Some of Britain’s most powerful business executives have
appealed to Gordon Brown to drop the Government’s controversial plans to
bring companies’ overseas earnings into the UK tax net. The Multinational
Chairmen’s Group issued the warning during a recent visit to 10 Downing
Street. (The Sunday Times)
Banking
& finance
Citigroup The legal storm unleashed by Parmalat’s collapse in 2003 will
enter a new phase today when Citigroup becomes the first bank to go to trial
in a damages case for its alleged role in the Italian milk company’s
meltdown.
Berkshire Hathaway Warren Buffett’s new bond insurer emerged as the
biggest underwriter of US local government securities in its first full
quarter of operation, taking in $400 million (£203 million) of premiums
relating to an estimated $20 billion of municipal bonds.
Asian Development Bank Asian financial leaders gathered in Madrid over
the weekend for four days of talks at the annual meeting of the Asian
Development Bank (ADB), calling for urgent global action to combat soaring
food prices and a pledge of fresh financial aid to help to feed Asia
Pacific’s poorest nations. A 43 per cent rise in global food prices in the
year to March has sparked violent protests in the developing world.
HSBC Holdings has sold bonds worth 2.25 billion dirhams (£310 million),
the largest conventional dirham bond to be sold by any bank, it said
yesterday. The money raised will be used for general corporate purposes,
HSBC Bank Middle East said. The issue highlights investor appetite for Gulf
Arab securities in local currencies, on expectations that these may be
allowed to strengthen to stave off rising inflation. All Gulf Arab
currencies - except for the Kuwaiti dinar - are pegged to the falling US
dollar, but there are persistent reports that they may be uncoupled from the
US currency.
JPMorgan Chase expects its takeover of Bear Stearns to close before
June 30, earlier than had been expected, James Dimon, the chief executive,
told a German newspaper. “Now it’s mainly about keeping the most important
customers and the best employees,” he said. Mr Dimon ruled out acquiring
Citigroup or its German operations, should they be put up for sale.
Barclays has held talks with an investment fund linked to the South
Korean Government as it seeks ways to raise billions of pounds of fresh
capital. (The Sunday Telegraph)
Royal Bank of Scotlandis eliminating free banking services for
thousands of business customers. The move has been denounced by customers
and business organisations. (The Observer)
Aberdeen Asset Management, the fund manager, is expected to report
tomorrow a 9 per cent rise in first-half profits to £47 million, driven by
cost cuts and a resilient fund performance amid volatile equity markets.
Lloyds TSB Group Investors are likely to focus tomorrow on Lloyds TSB
Group’s capital strength and the scale of any further writedowns related to
the credit crunch when the the British bank issues a trading update. There
is speculation that Lloyds could follow rivals such as Royal Bank of
Scotland Group and HBOS in launching a rights issue to shore up its capital
base.
Triodos Renewable Energy Fund, managed by Triodos Bank, the ethical
bank, is raising £8.5 million through a new share issue. The money will be
invested directly in renewable-energy projects and companies. Triodos Bank
has €3.3 billion (£2.6 billion) under management.
TPG, the US private equity firm, has agreed to buy a 25 per cent stake
in Strauss Group’s coffee operations for $288 million (£144 million), the
Israeli food and beverage company said yesterday. TPG is also getting a
two-year option to buy another 10 per cent of the coffee business at the
current valuation plus 6 per cent a year, Strauss said.
Construction
& property
Invista Real Estate Investment Management said that Celsius European
Holdings Sarl, its 50 per cent owned joint venture, had completed the sale
of a portfolio of 23 investment properties for €170 million (£133 million).
The buyer, Clerical Medical Non Sterling Property Company Sarl, will pay
€168 million cash and the remainder in assumed liabilities.
Consumer
goods
Carlsberg, the largest Danish brewer, is expected to report on
Wednesday first-quarter ebit (earnings before interest and tax) before
special items of 402 million kroner (£42 million), unchanged from a year
earlier.
Engineering
Daimler Dieter Zetsche, the chief executive of Daimler, the German
carmaker, is interested in cooperating with Jaguar and Land Rover, according
to a report in a German trade magazine. Dr Zetsche said that he could
envisage supplying the two brands with components, auto motor und sport
reported yesterday. Jaguar and Land Rover are owned by Tata Motors, of
India, which acquired them from Ford Motor Company for $2.3 billion (£1.2
billion) in March. Daimler owns about 7 per cent of the Indian company.
EADS The board of EADS is scheduled to meet on May 13 to decide whether
to continue with its plan to cede control of seven Airbus manufacturing
plants, Le Journal du Dimanche, the French weekly, reported over the
weekend. The paper suggested that the meeting could take as early as
tomorrow.
BAE Systems, the defence group, may announce the successor to Mike
Turner, the outgoing chief executive, at its annual meeting on Wednesday,
according to a broker. BAE is reported to have shortlisted three candidates:
Ian King, the chief operating officer for its UK and international
businesses; Christopher Kubasik, Lockheed Martin’s executive vice-president
of electronic systems business area (ESBA); and Fred Kindle, the former
chief executive of ABB.
Health
AstraZeneca, the second-largest British pharmaceuticals company, has
submitted a marketing application to the European authorities for Gefitinib,
its oral anticancer drug, as a treatment for locally advanced, pretreated,
non-small-cell lung cancer (NSLC).
Industrials
Alstom is expected to report on Wednesday a steep rise in its full-year
earnings to €811 million (£633 million), because of strong global demand in
its transport and power engineering divisions.
Leisure
Center Parcs UK, the leisure group that offers family activity holidays
in some of Britain’s biggest forests, has pinpointed Ireland as its next
location after it opens its new £200 million site in Bedfordshire in 2010.
Media
The Washington Post Co, the American publisher, has reported lower than
expected quarterly profits after taking a charge for an early-retirement
programme on its Newsweek magazine. First-quarter net income fell to $39.3
million (£20 million), from $64.4 million a year earlier.
Natural
resources
Lonmin, the world’s third-largest platinum producer, is expected on
Thursday to report higher profits for the first half, mainly because of
stronger prices for precious metals. Analysts expect ebit (earnings before
interest and tax) for the six months to end-March to rise to $392 million
(£199 million), from $229 million a year earlier.
Opec Gordon Brown called yesterday on Opec, the oil producers’ group,
to act to reduce oil prices. “Clearly, oil prices are very high,” he said in
a television interview. “Clearly also, there needs to be some international
effort with Opec to get the oil price down.”
Retailing
Next, the high street and catalogue fashion retailer, is expected to
reveal dismal first-quarter sales when it gives a trading update on
Thursday. Analysts reckon that sales will undershoot the Leicester-based
group’s internal budgets.
Baugur, the Icelandic bank, may be forced this week to clarify its
intentions towards Moss Bros, the menswear chain in which it has a 29 per
cent stake, amid weekend reports that it is close to making a formal £40
million offer.
Wal-Mart, the American super-market giant, is thought to have been the
whistle-blower behind a recent investigation by the Office of Fair Trading
into the alleged price-fixing of food and toiletries in the UK.
Support
services
Adecco, the recruitment company, is expected to report slightly lower
first-quarter net profits of €127 million (£99 million) tomorrow, down from
€133 million the year before, mainly because of exchange rates.
Technology
AOL, the internet arm of Time Warner, is understood to have approached
Microsoft about a possible tie-up as a deal between the software giant and
Yahoo! unravelled.
Telecoms
Ofcom, the telecoms regulator, has confirmed that O2, the mobile
operator, has met its obligation to roll out its 3G services to at least 80
per cent of the UK population, avoiding a threat to shorten its licence by
four months.
Carlos Slim, the Mexican telecoms billionaire, has built a 1 per cent
stake in Independent News & Media (INM), the owner of The Independent.
Mr Slim’s holding has emerged amid a battle between Sir Anthony O’Reilly,
the former Heinz chief executive, whose family controls 28 per cent of INM,
and Denis O’Brien, the Irish telecoms entrepreneur, who has a 21 per cent
stake. (The Sunday Times)
Transport
European airlines The European Union has issued a directive allowing
European airlines to buy and sell from one another the takeoff and landing
slots that they do not use, allowing Alitalia, the troubled Italian carrier,
potentially to refurbish its distressed accounts, according to a report in
Corriere della Sera, the Italian newspaper. With this directive, Alitalia
may not need the bridging loan of €300 million (£234 million) that it was
granted by the Italian Government.
EasyJet is expected to report a wider interim pretax loss of about £60
million on Wednesday because of increased restructuring and fuel costs.
Utilities
Nuclear power The British Government has vastly underestimated the cost
of building a new generation of nuclear power plants, according to Wulf
Bernotat, the head of E.ON.
