Newspaper Briefing, including 'News Corp investors talk of a change at the top ...
Newspaper Briefing informs you of what is happening in the news before the market opens. We believe our Newspaper Briefing is an invaluable tool to set up your trading day, therefore giving you an edge. Our Newspaper Briefing is just the start of our trading day at Guardian. We work with our clients to provide them with information and guidance to enhance their trading decisions. Guardian will provide you with an individual service together with the most suitable and expert advice at a fair and reasonable cost. Gilts: U.K. Government bonds eased for a second day amid hopes that Europes leaders would reach an accord to contain Greeces debt problems. September gilt futures settled 24 ticks lower at 123.09, still outperforming German bund futures, which settled almost 90 ticks lower. In the cash market, the yield on ten year gilts rose two basis points to 3.07%. Deal of the day: IPSA shares more than doubled to 10.63p, after the South African power generator agreed to sell four gas turbines for $66 million (41 million) to two separate investment groups. Shouldering debt of 36.8 million, the sale should allow IPSA to focus on other energy projects in the country, having relied on the support of its creditors for some time. Airbus and Boeing split record $40 billion order: British manufacturing received a boost after winning a slice of the worlds largest aircraft order. American Airlines announced plans to buy 460 aircraft from Boeing and Airbus, with options to buy a further 465. The deal is worth $40 billion (25 billion) at list prices, with options taking the total to $81 billion. EDF breaks its promise by delaying reactor until U.K. needs it: Vincent de Rivaz told The Times that the reactor at Hinkley Point in Somerset would be ready when the U.K. needs it. Mr de Rivaz said that Britain no longer needed the reactor to be ready by that date because the financial crisis of 2009 and energy efficiency measures had reduced long-term electricity demand. News Corp investors talk of a change at the top: After a chastening ten days in Britain, Rupert Murdoch flew out of Luton airport with questions swirling around News Corporations leadership, strategy and succession planning. The Murdoch family has a near unassailable grip on News Corp through its ownership of 39% of the organisations voting shares. Google plans to strengthen Android: Google is understood to be in early talks to buy a wireless technology maker as it looks for ways to defend its leading position in the mobile phone market. InterDigital said on Tuesday that it had begun to explore strategic alternatives, including a possible sale. After the announcement, its share price rose by 28%, giving it a market capitalisation of $2.4 billion (1.48 billion). Interest rate rise looking unlikely until well into 2012: The latest minutes of the Bank of Englands Monetary Policy Committee and other economic news point to interest rates staying on hold until well into next year, analysts say. The Treasurys latest poll of independent forecasts also reveals a consensus growth figure of just 1.3% for 2011 against the official figure of 1.7%. BT told to cut rural broadband costs: The telecoms watchdog has ordered BT to slash its charges to rivals to help bring cheaper broadband to millions of homes in rural parts of Britain. Ofcom revealed it called on BTs wholesale arm to reduce its charges to internet service providers, such as Sky and TalkTalk, using its network to serve customers in the countryside. Matrix parts company with Le May: Matrix Group is parting company with Malcolm Le May, the head of its investment banking business, as the broker reviews the future of the operation. Mr Le May is said to be retiring from Matrix Corporate Capital (MCC) after two years as Chief Executive. Fall in usage slows, says Severn Trent: Severn Trent has reported a smaller than expected decline in water consumption amid near drought conditions over the spring. The group, which supplies eight million customers across the Midlands and the heart of England, said the recent rain had been helpful, but was not yet enough to rule out hosepipe bans in certain areas. WPP merges Finsbury and RLM: Finsbury, a prominent City of London financial public relations firm, is merging with Robinson Lerer & Montgomery, a U.S. communications consultancy, in the latest attempt to build a professional services group straddling the main financial centres on either side of the Atlantic. Both companies are owned by WPP, Sir Martin Sorrells UK-listed advertising, measurement and marketing services group. Roland Rudd, the Founder of Finsbury, will become Chairman of the new RLM Finsbury, and Walter Montgomery, one of RLMs Founders and its Chief Executive, will become CEO of the merged group. Riverbed buys U.K. cloud company for $140 million: Riverbed Technology, the U.S. IT services company, on Wednesday announced a deal to buy Zeus, a U.K. cloud computing company, for $140 million in cash. It is the latest in a series of acquisitions of companies providing tools for cloud computing, or hosting and handling data remotely over the internet. AstraZenecas anti-blood clotting drug approved: U.S. regulators have approved AstraZenecas anti-blood clotting medicine Brilinta while requiring warnings restricting its use, in a boost to the Anglo-Swedish pharmaceutical group. The Food and Drug Administration authorised the sale of the medicine, which has already been authorised in Europe but which appeared less effective in a sub-group of US patients in clinical trials. Cnooc / Opti: Six years after being rebuffed by Washington on its Unocal acquisition and shortly after fellow Chinese oil producer PetroChina saw a big gas deal with Encana fall apart, Cnooc has targeted a North American energy deal that should go smoothly. Opti Canada was in bankruptcy and its price is just $34 million cash plus $2 billion in debt, raising Cnoocs proven reserves by 5%. The low cash outlay aside, Chinas largest overseas oil producer appears to be getting quite a bargain, paying about $1 a barrel. This is low not only compared with conventional oil producers but also with recent oil sands transactions done at almost twice the price. But it reflects risks that have deterred others. Optis only producing property, a 35% stake in Long Lake, operated by Nexen, produces below capacity amid concerns over the quality of its bitumen (the laboriously extracted gunk that is upgraded to crude oil). Sinopec is already an oil sands presence with its $4.7 billion Syncrude investment and Cnooc, now making its second small deal and with about $3 billion in net cash might go after bigger fish too. With western companies afraid to get dirty, China has this sandbox largely to itself. Ecolab / Nalco: Carl Icahn has made and raised an offer for bleach-maker Clorox; Switzerlands Lonza picked up anti-microbial exposure by buying Arch; Sealed Air acquired cleaning products maker Diversey. Now Diverseys competitor, Ecolab, is going from washing dishes and sheets to purifying water, buying industrial water treatment firm Nalco for $8.1 billion, including debt. The deal is less than pristine, in the markets view: the acquirers shares were down 9% the morning of the announcement. This despite Ecolab managements argument that the stock and cash deal will be accretive to earnings per share brings Ecolab into a market with strong secular growth potential and generates plenty of synergies over time, given the firms shared foundation in chemistry. Adding Nalcos $4.3 billion in revenues to Ecolabs $6.1 billion threatens to dilute both these virtues. During the crisis year of 2009, Ecolabs sales fell by under 4%, for example; Nalco suffered an 11% drop. Returns on invested capital at Ecolab were 15% in 2010, according to Credit Suisse. At Nalco it was 9%. BSkyB: The sky is clearing over British Sky Broadcasting. At some point in the phone hacking scandal BSkyB was always going to decouple from News Corp. That moment came on 13 July when Rupert Murdoch scrapped News Corps bid for the 61% of the U.K. satellite broadcaster it does not own. The disappearance of the takeover premium lets investors look again at the standalone company and ask whether its future is as rosy as its past. BSkyBs shares fell 18% between the outbreak of the scandal and the withdrawal of the bid but have since climbed 7%. They trade on a forward price to earnings ratio of about 16, compared with 19 before the June 2010 bid approach. BSkyB reached its target of 10 million subscribers (set in 2004) in November last year; subscribers to its triple play (TV, phone and broadband) have grown from zero to 26% in five years. And it is now weaning itself off pure customer growth to focus on premium products: entertainment and high definition services. UBS estimates that growth will expand 2.1% over the next three years with average revenue per customer growing at 3.9%, compared to 4.5% and 7% in the past five years. Rothschild Snr rivals networker Nat with China fund: The travails of Fidelitys Anthony Bolton show that China can be a tough market, even for City investment veterans. But Lord Jacob Rothschild, Chairman of RIT Capital Partners, has opted to tackle the growth opportunity contrarily, with a $750 million private equity fund offering Chinese investors an international investment. That avoids the hazards that the aspirational accounting of some Chinese companies creates for foreign retail funds. The launch shows a younger generation of deal-doers that the 75-year-old still has a trick or two up his well-tailored sleeve. His son Nat recently launched Vallares, a 1.35 billion London-listed cash shell. Using the powerful Rothschild family brand to forge connections with powerful people in fast-growing economies is a common thread. Nat persuaded the Bakrie family of Indonesia to inject valuable coal assets into his earlier Vallar shell. Pa must have meanwhile won friends and influenced people in China to gain state approval for his private equity fund. Murdochs Mini-Me: Allegations of criminality imperil the position of an octogenarian entrepreneur whose business might not continue in its present form without him. Not Rupert Murdoch. But Bernie Ecclestone, habitually referred to as the supremo of the billion-dollar dodgem contest that is Formula One. Mr Ecclestone, who once suggested women should dress in white to blend in with other domestic appliances, is no stranger to controversy. This time round the track he has been of accused bribing a German banker, charges that he is understood to deny. This could create a teaser for CVC, the private equity business that bought a controlling stake in F1 in 2005. Should it remove the tenacious Mr Ecclestone from the post of Chief Executive if, Heaven forbid, he emerges badly from the case? There are two schools of thought within F1. The first is that an ejection would benefit a business worth $1.6 billion in revenues last year, according to Formula Money estimates. Wall Street paralysed by U.S. debt talks: Wall Street was reduced to a state of virtual paralysis on Wednesday, as hopes of Congress striking a multi-trillion dollar deal to avoid a U.S. default changed by the hour. The S&P 500 and the Dow Jones Industrial Average opened higher in New York as President Barack Obama voiced his support for a last-ditch plan proposed by a group of Senators. Intel sales hit record $13 billion despite slowing PC market: Intel brushed off concern that a slowing PC market in the U.S. would skewer profits after the worlds biggest chipmaker said demand will grow this quarter. The company expects sales to reach $14 billion (8.7 billion) this quarter as it taps into demand for PCs, as well as servers, in the worlds major developing economies. McDonalds Olympic restaurant will be biggest in the world: The busiest and biggest McDonalds is the world will be within the Olympic park in London, when it opens for business next summer, seating 1,500 customers. The fast food company is a long-standing sponsor of the Olympics, and as a result has a monopoly on all the catering outlets within the Olympic park in Stratford, east London. International Ferro Metals steeled for profitable future: International Ferro Metals (IFL) is a South African producer of ferrochrome, which is used in the production of stainless steel. Its results have been hit by strength of the rand compared with the dollar and rising energy prices. Contract prices were also reduced recently, in line with other commodity prices. The ferrochrome price for the third quarter of this year was set on 11 July and was reduced by 15 cents to $1.20 per pound. Production was down by 17% from the equivalent period of last year to 42,584 tonnes. Sales were down 37% to 34,735 tonnes. Industry experts are forecasting a record year for stainless steel production in 2011 and again in 2012, however the third quarter is traditionally weak and we have seen this in lower benchmark prices and reduced output of ferrochrome from the South African producers, David Kovarsky said. The companys net debt was ZAR248 million (22 million) at the end of June. The shares are trading on a June 2012 earnings multiple of 35.9 based on current forecasts, falling to just 3.1 times in 2012. The shares were first tipped at 56p on 08 August, 2009 and are down almost 70%. Analysts have a very wide range of price targets for the group, with Bloomberg quoting price objectives ranging from 25p to 84p. As analysts from Collins Stewarts mining team put, This Company presents a great opportunity for longer term investors to take a counter cycle position at heavily discounted levels. However, Questor says hold until we receive the next update despite believing that the shares are significantly undervalued. International Ferro Metals at 18p -p. Questor Says Hold. Johnson Matthey better than expected: Johnson Matthey, which manufactures one third of all the auto catalysts in the world, posted a much better-than-expected, first quarter trading update. Indeed, the companys outlook statement was also decidedly bullish a real positive from a company that is usually pretty conservative in its guidance. Questor suspects that there may be some slight forecast upgrades from analysts but most will wait for the interim numbers, which are slated for release on 23 November. Sales excluding precious metals rose 12% to 61 million, with underlying profits up 19% to 98.2 million. This was down to increasing demand for its products and operational leverage. Sales in the quarter grew by 6% to 150 million, but Matthey said that operating leverage and a change in mix led to operating profit being significantly higher. The fine chemicals division saw sales up 15% to 70 million. The shares were first recommended as a tip of 2011 at 20.38 and they are down 1% compared with a FTSE 100 down 4%. Trading on a March 2012 earnings multiple of 14.9 falling to 13.1 next year and yielding 2.6%. Johnson Matthey at 20.16 +78p Questor Says Buy. Merkel and Sarkozy thrash out last-minute compromise over Greece: Germany and France struck a deal early on Thursday morning intended to rescue Greece and the Euro from financial ruin. After six hours of talks in Berlin prior to a crucial summit in Brussels, Chancellor Angela Merkel and President Nicolas Sarkozy agreed a compromise on the losses that Greeces private creditors are to take, in a complex new bailout for Athens, German and French government sources said. Rate likely to stay at 0.5% until 2012: Base rates are likely to be kept on hold at 0.5% until at least next year after the latest minutes of the monetary policy committee revealed concerns that declining consumer confidence and a lending drought will restrict growth. The MPC judged that recent economic weakness had reduced the chance that interest rates would need to rise in the near term. Former Clinton aide to lead Starbucks in U.K. and Ireland: President Bill Clintons former aide and White House press secretary has been named the new Boss of Starbucks U.K. and Ireland operations. Kris Engskov joined the American coffee chain in 2003 as Director of public policy and was most recently regional Vice-President of its U.S. Pacific Northwest region. Recession hit Midlands workforce hardest: Workers in the manufacturing heartland of the West Midlands faced the sharpest increase in unemployment during the recession, while London and the south-east were cushioned from the worst of the job cuts. The unemployment rate in the West Midlands shot up from a pre-recession trough of 4.5%, to 10.6% by mid-2009, according to a new analysis by the Office for National Statistics an increase of 6.1% points, the sharpest in the country. Sir John Vickerss banking reforms come under heavy fire: The governments banking commission has failed to make a water-tight case for splitting customers loans and deposits from banks riskier operations, according to MPs. They warned that the Independent Commission on Banking was in danger of taking a leap into the dark unless it undertook more rigorous analysis of its ring-fencing plans. Euro debt crisis pain can rip through the Continent: European leaders were urged to solve the debt crisis crippling Greece and stop the turmoil ripping through the Continent. Jose Manuel Barroso said: Nobody should be under any illusion the situation is very serious. It requires a response, otherwise the negative consequences will be felt in all corners of Europe and beyond. LSE fights for independence from foreign predators: The London Stock Exchange has issued a bold declaration of independence after stating its willingness to resist any overtures from predatory American rival Nasdaq. The US technology exchange has been tipped to launch a third takeover bid for the LSE following the collapse of the British groups agreed takeover of Canadas TMX last month. Unrest puts Santander 20 billion float in question: Santander is braced for a further delay to the 20 billion float of its U.K. arm amid continued market and regulatory uncertainty. It is believed the Spanish bank, which has 1.8 million U.K. shareholders, will be forced to push the proposed listing out until the first quarter of next year as the markets remain turbulent in the face of the Eurozone debt crisis, uncertainties over the U.S. and fears for continued Chinese growth. Rio Tinto set for U.K. power plant sell-off: Rio Tinto is understood to be eyeing the potential sale of one of its U.K. power stations to German owned energy giant RWE Npower, writes Philip Waller. Rio Tinto is reviewing the station at Lynemouth in Northumberland amid concerns that reducing its emissions to meet new environmental laws starting in 2013 will cost up to 40 million. Plans for Scots gold rush: Gold mining could yet be revived in Scotland after prospector Scotgold Resources submitted a revised planning application to open a mine in Argyll. Scotgolds new plans for the mine at Cononish near Tyndrum involves a reduction in the size of the tailings management facility where waste material is disposed and a new lay-out it said would reduce the impact on the landscape. SEP in line for 31 million over sale of Zeus stake: Scottish Equity Partners (SEP) has made a bumper gain on its investment in a Cambridge-based firm which develops software that helps websites cope with heavy traffic, writes Mark Williamson. The technology investment firm is in line to receive around $50 million (31 million) for its 34% stake in Zeus after the sale of the firm to Americas Riverbed Technology Company. Former Simclar Finance Director free to sell his 1 million property Judge lifts Inhibition on house sale amid deal talks: The former Finance Director of the electronics firm Simclar Group is free to sell the Edinburgh house he has put on the market for around 1 million after a judge lifted legal restrictions on the proposed sale. Lord Glennie ruled an inhibition preventing Ian Durie from selling his five-bedroom home should be removed. MPs raise concerns over ICB banking reform proposals: Pressure mounted on Sir John Vickers and his Independent Commission on Banking (ICB) after MPs rounded on its plans to reform the sector by forcing banks to ring-fence their retail arms. The influential cross-party Treasury select committee warned that the ICB's interim report had not addressed certain issues - such as a full split of the banks and corporate governance - in enough depth. Record levels of Scottish firms failing fuels fears for recovery: A record number of Scottish firms went bust in the past three months as fragile consumer confidence and difficulties with bank lending continued to strangle the economic recovery. Official figures released by the Accountant in Bankruptcy showed that 343 companies fell into liquidation or receivership in the three months to 30 June, a 16.6% rise quarter on quarter and up 12.8% year on year. Climate Change Capital pulls out of SSE deal: A fund specialising in renewable energy has pulled out of buying Scottish & Southern Energy's (SSE's) stake in a wind farm after it decided against raising the money under current market conditions. Climate Change Capital said it had postponed a fund-raising that would have allowed it to buy SSE's 50% interest in the Braes of Doune wind farm near Stirling for 61.3 million, as agreed last month. The fund blamed financial market conditions for its decision. Planning woes 'holding up green drive': Farmers and landowners are expected to play a major role in helping the Scottish Government achieve its aim of being able to generate 100% of the country's electricity requirement from renewable sources by 2020. However, the National farmers Union of Scotland has made it clear to John Swinney, secretary for finance, employment and sustainable growth, that this aim is being frustrated by difficulties encountered in the planning system. Farms put at risk by lack of thought over succession: Farmers still tend to shy away from discussing the handing over of the farm to the next generation, despite it being a major issue - with a great deal of capital tied up in the business and where a wrong decision can cause a lot of grief. Robert Scott-Dempster, Head of land and rural business at Gillespie Macandrew, said the issues surrounding farm succession was an increasing problem. Often there is not too much thought goes into it and, as a result, a number of people are in a tangle.Wholesale Split Rail Fence - News
Ofcom revealed it called on BTs wholesale arm to reduce its charges to internet service providers, such as Sky and TalkTalk, using its network to serve customers in the countryside. Matrix parts company with Le May: Matrix Group is parting company with
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