Tuesday, 5 February 2008

Olivant withdrew bid

Britain's plans to extricate itself from the collapse of mortgage bank Northern Rock stumbled as it faced the prospect of an auction with only two bidders, unless it changes the terms of the sale. The Virgin Group and an "in-house" management team have made rescue offers. The Government has indicated that it is keen on a private sector solution after a four-month crisis has added to a slump in Prime Minister Gordon Brown's popularity.

The investment firm, Olivant, quit the race yesterday 15min before the deadline, but would consider re-entering if the government was willing to reconsider the terms. Olivant, headed by former Abbey CEO Luqman Arnold said: “Olivant was unable to put together a proposal that met its investment criteria and that of other stakeholders. It wanted to repay a £25 billion loan from the government over five years, whereas the government wants to be repaid within three years.” (source: Reuters)

It seems like News Corporation, has shrugged off the writers’ strike to double profits to a better than expected 24% growth in operating profits. That gain to $1.4 billion (£709 million), was dragged down, however, by a $299 million (£149.5 million) write down on the investment made by News Corporation’s affiliate, British satellite broadcaster, BSkyB, on its holding in ITV. Net profits, after the charge, were up $10 million (£5million) to $832 million (£416 million).

News Corporation has also ruled out a counter bid for Yahoo!. Rupert Murdoch, the chief executive, said: “We are definitely not going to make a bid for Yahoo!.” Profits at Fox Television, and the company’s other network television operations jumped to $245 million (£122 million) from $112 million (£56 million), as the company benefited from resilient prime-time ratings at a time when rivals suffered amid a writers’ strike that has affected popular programmes and led to declining audiences. The network was also helped by the $250 million (£125 million) generated in advertising from broadcasting the Super Bowl at the weekend after the financial quarter ended.

Elsewhere, a weaker release slate meant that film profits were down 14% to $403 million (£201.5 million), while Sky Italia posted a $62 million (£31 million) profit compared to a $12 million (£6 million) loss a year ago. (source: Timesonline)

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