The Entrepreneur

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2008-04-23T00:35:00.000-07:00

To all the regular "the entrepreneur" readers - This site has moved to its new home, so please keep on reading The Entrepreneur via our new website at:

http://tycoonentrepreneur.terapad.com/

Thanks for you continued support.

Virgin Comics

2008-04-22T01:36:00.000-07:00

Stan Lee, the legend and co-creator of some of the world’s best-known superheroes including Spider-Man, X-Men and the Hulk, has been recruited to create a new line of characters for Sir Richard Branson’s upstart Virgin Comics.

The new venture will see the 85-year-old, former president of Marvel Comics, back as both a writer and editor, overseeing a line of new comics that will be launched next year, including a title he is writing himself.

Sir Richard Branson said "Stan Lee is a cultural icon and we welcome him to his new home, Virgin Comics, for this bold new chapter in his great legacy,"

Mr Lee ended his exclusive relationship with Marvel in the 1990s but still has ties to the company, including cameo roles in films Iron Man and The Incredible Hulk. He trained some of the industry's most influential figures in the industry under a system called the ‘Marvel Method’. While not commonly used in the industry today, Mr Lee's process enables the writer and artist to sculpt the story together from the ground up in iterative stages, rather than writers just delivering a full script to an artist.

Virgin Comics launch in November 2005 saw Virgin Group enter a partnership with Gotham Entertainment Group, South Asia's leading comic publisher; Shekhar Kapur, the filmmaker, and Deepak Chopra, the author, to launch two companies, Virgin Animation in Bangalore and Virgin Comics in New York. (source: Timesonline) - Virgin Comics

World's Top Brands

2008-04-21T10:27:00.001-07:00

Google - $86.1 billion
General Elecric - $71.3 billion
Microsoft - $70.8 billion
Coco-Cola - $58.2 billion
China Mobile - $57.2 billion
IBM - $55.3 billion
Apple - $55.2 billion
McDonald's - $49.5 billion
Nokia - $43.9 billion
Marlboro - $37.3 billion
Vodafone - $36.9 billion

Ephren W Taylor II - Youngest African-American CEO

2008-04-21T02:52:00.000-07:00

Ephren W. Taylor II is the youngest African-American CEO of any publicly traded company ever City Capital Corporation (stock symbol:CTCC). Described as “walking history” by popular radio show host Tom Joyner, Taylor started his first business venture at age 12, when he began making video games. By age 17, he built a multi-million dollar technology company; GoFerretGo.com.

In 2007, at City Capital Corporation, Taylor started the Goshen Energy initiative; which focuses on producing alternative energy specializing in biofuels. Taylor’s commitment to green energy is part of his concept of empowering local communities with both profitable and socially-conscious investing and development. Through his action on green energy and philanthropy, Taylor is leading a new wave of CEO’s focusing on corporate social responsibility.
Taylor’s diverse business portfolio is quickly transforming him into a household name. He appears weekly on FOX News and has been featured on network shows such as ABC’s 20/20 and Montel Williams show. He also has regular appearances in print and radio media including PBS, Black Enterprise, and the Miami Herald.

Beyond his unprecedented accomplishments at an early age in business, Taylor is an author, inspirational speaker, and real estate mastermind. His first book, “Creating Success from the Inside Out”, is published by the world’s number one business publisher, Wiley and it recently ranked as the #1 best seller at CEO Read. The book serves as an expose of the mindset of today’s multi-millionaires while defining success as not only attaining wealth, but how to utilize it.

In celebration of their 170th anniversary, Taylor completed a specialized curriculum for high school-aged aspiring entrepreneurs at Cheyney University, America’s oldest historically black college and university. After providing a donation to get the program started, The Ephren Taylor Entrepreneur Academy opened in July 2007.

What Warren Buffet is for baby boomers, Taylor is for today’s generation X and Y a rapidly emerging premier financial expert; a true “wealth engineer”.

CAREER HIGHLIGHTS
· Made first million by 16
· Youngest Black CEO of a Publicly Traded Company
· Oversees over 250 Million in Assets
· Starting Investment Clubs at schools across the nation
· Developing national business plan competition for university students
· Started business ventures at the age of 12
· Works with superstar entertainers such as Snoop Dogg and Fat Joe
· Diverse client list ranges from Stock Market Day Traders to Hip Hop Icons

SPEAKING TOPICS
· Getting P.A.I.D.
· Vision Driven Wealth
· Sow to Grow
· Investment U
· Becoming a Wealth Engineer
· Pennies to Billions
· Instant Entrepreneur
· Lessons from the Sandbox: How to raise a Millionaire

Google report profits

2008-04-18T03:27:00.000-07:00

It appears as if Google, the internet search giant, is immune against the credit crunch as it reported better-than-expected financial results for the first three months of the year, igniting a huge rally in its shares.

Chief Executive of Google, Mr Eric Schmidt said “We are obviously very pleased with another strong quarter for Google. It is clear to us that we are well positioned for 2008 and beyond, regardless of the business environment that we find ourselves surrounded by."

The results came as a relief to investors, who were bracing for a big slowdown in Google’s business. The company issued its report after the close of markets, and its shares surged more than $76.42 (£39.59), or 17%, in after-hours trading, to end the day at $525.96 (£272.5).

Still, Google’s performance is not likely to ease anxiety among investors about the overall health of the online advertising business. The company relies almost exclusively on short text ads that appear next to search results and on other Web sites. Analysts say that because those ads are more targeted and are used by marketers to drive traffic to their sites, they are more impervious to a slowdown than banners and other graphical ads, which are intended to increase brand awareness.

Google, said net income grew 30%, to $1.31 billion (£678 million), or $4.12 (£2.13) a share, compared with $1 billion (£500 million), or $3.18 (£1.64) a share, in the first quarter of 2007. Revenue climbed 4%, to $5.19 billion (£2.68 billion), from $3.66 billion (£1,89 billion) a year earlier.

On average, Wall Street analysts were expecting Google to report revenue, excluding commissions to advertising partners, of $3.61 billion (£1.87 billion) and income, excluding the cost of stock options, of $4.52 (£2.34) a share.

Google said that DoubleClick, which it acquired in mid-March, had little impact on the company’s finances this quarter. Executives said they were working on integrating the two companies’ products. They said the integration would help growth in Google’s nascent display advertising business. (source: New York Times)

Co-op to buy Somerfield & how John Paulson made billions from the credit crunch

2008-04-17T06:03:00.000-07:00

The UK’s fifth largest supermarket chain, The Co-operative Group (Co-op), is in talks to buy rival Somerfield. Discussions are at an early stage between Co-op and the owners of Somerfield, Apax & Barclays Capital, but the Co-op said there would be a strong fit between the two companies. The news came after Co-op said it was investing £1.5 billion in an attempt to double its profits by 2010.

The Manchester-based Co-op is a mutual business, run on behalf of its 2.5 million members. It expanded in July of last year when it merged with fellow mutual United Co-operatives. With more than 4,300 retail outlets across the UK, it employs 85,000 people. Bristol-based Somerfield has 900 stores.

Dividend payments to its customer members have more than doubled from £22 million to £45 million. Apax, Barclays Capital and a private equity consortium led by property tycoon Robert Tchenguiz bought Somerfield for £1.1 billion in 2005. (source: BBC News)

It is a jarring comparison for the millions of American homeowners struggling with their soaring mortgage payments, but there is one man who has profited so much from the credit crisis that he is jumping a few rungs on the property ladder this year.

He is John Paulson (pictured), a previously obscure hedge fund manager from New York, who took home $3.7 billion (£1.9 billion) last year, after betting on a calamity in the mortgage market. This is the equivalent of a lottery jackpot every day for a year.

Mr Paulson bought a 10.4-acre lakefront compound in Hamptons, the upstate playground for New York's rich and famous, complete with staff quarters, two outhouses and ocean views for $41 million. His more modest seven-bedroom, three-acre "cottage" a mile down the road, is up for sale with a price tag of $19.5 million.

It has turned Mr Paulson into an industry legend overnight, courted by powerful bankers and politicians, anxious for insight on how bad the housing crisis in the US and the global credit crunch might still get.

Mr Paulson's story is rich with other ironies. Now 52, he learnt his trade in part during four years at Bear Stearns, the investment bank which lost billions in 2007 making optimistic bets on mortgages that were the mirror image of Mr Paulson's. Its collapse last month is the defining catastrophe of the credit crisis. He also shares a name with – but is no relation of – Hank Paulson, the US Treasury Secretary, whose tenure has been spent trying to shore up the housing market.

John Paulson set up his hedge fund in 1994 and spent more than a decade as a middle-ranking fish in an increasingly crowded pond, until realising 18 months ago that the mortgage market was headed for disaster as millions of US homebuyers were signing up to loans they would not be able to afford. There would soon be a day of reckoning for borrowers and their profligate lenders, he calculated, and the multi-billion dollar market for mortgage derivatives was bound to collapse.

Putting his own money, his clients' money and billions of dollars of borrowed funds into the bet, he won big. Paulson & Co, his fund, had $6 billion under management at the start of 2007 and $28 billion at the end. The gains on his own capital and his cut of the fund's fees netted him $3.7 billion over the period.

That puts him atop Alpha's list of top earners ahead of George Soros, the veteran trader who has also been betting on economic calamity in the US and who took home $2.9 billion. A hedge fund manager had to earn $210 million to make the top 50. (source: The Independent)

Tesco reported annual profits of £2.84 billion

2008-04-16T02:37:00.000-07:00

Despite a the gloomy economic conditions, Tesco reported an 11.8% rise in underlying annual profits for 2007 of £2.846 billion. Group sales at Tesco rose to £51.8 billion, up 11%. Tesco said prices had risen by about 1.5% across the board, but increases in food prices masked price cuts in non-food items.

Online and non-food items helped to boost Tesco's UK business, while sales from its international stores also showed strong growth, up 25.3% in 2007. The supermarket group said it would create 30,000 new jobs worldwide this year, with about a third planned in Britain.

In the UK, like-for-like sales excluding petrol rose 3.5% during the year to February as Tesco battled a wet summer, a consumer slowdown and "recovering competitors". By the same measure, sales were up 4% in the first five weeks of its new financial year starting 23 February, helped by the early Easter break.

Tesco shares rose 7.29%, or 28.50 pence, to 419.50p at close of trade. (source: BBC News)

JJB Sports revealed a major blow to the high street today after it said it was shutting 72 stores with the loss of around 800 jobs. Details of the closure move emerged a day after discount clothing chain Ethel Austin went into administration and figures from the British Retail Consortium showed the first monthly sales drop for nearly two years.

It said the stores in question were unlikely to make any "significant contribution" to group profits and that many were already close to newer and larger stores in its estate. The sites will shut by the end of this month.

The moves were announced as JJB said adjusted profits fell 28% to £33.8 million in the year to January 27. A £25 million hit relating to the cost of closing the stores meant bottom-line profits fell 72% to £10.8 million. It said total revenues for JJB stores and fitness clubs for the seven weeks to March 16 were 3.5% lower than the same period last year, while margins also came under pressure as a result of the competitive trading conditions. (source: The Independent)

Virgin to takeover bmi

2008-04-15T02:49:00.000-07:00

A £750 million takeover bid for bmi is discussed by Sir Richard Branson with Dubai International Capital (DIC), the $12 billion sovereign wealth fund, about financing a possible takeover. The billionaire entrepreneur is understood to have joined senior executives from Virgin Group when they visited Dubai recently to discuss potential deals in the health, mobile phone and airline sectors.

Sir Michael Bishop, who owns 50% plus one share in bmi, is widely expected to put his stake up for sale this year, although he insists that he is under no pressure to do so. However, Lufthansa, is a 30% shareholder in bmi and has an option to buy out Sir Michael. However, if Lufthansa passes on Sir Michael's stake, then Virgin Atlantic will try to take control of the airline. Alternatively, there are rumours that Lufthansa and Virgin may co-operate in a deal to buy bmi and create a European super-carrier.

Virgin will not be able to takeover bmi without a fight from rival British Airways, which revealed last year that it would be interested in acquiring bmi. Virgin and DIC were partners last year in the failed bid for the struggling Northern Rock bank. The recent meetings are thought to have been preliminary discussions on how the two groups could co-operate in the future.

Other than bmi, the possible joint ventures could include developing a Middle Eastern Virgin mobile operation and expanding the presence of Virgin Active health clubs in Dubai.

Virgin is also interested in bmi because it would give it a short and medium-haul feeder network. This would bring passengers from across Europe to its base at Heathrow, allowing them to transfer to long-haul Virgin flights. (source: Timesonline)

In a move to create the US largest air operator, Delta Air Lines agreed a $3 billion (£1.5 billion) takeover of Northwest Airlines. The all-share offer has to secure regulatory approval although analysts do not expect it to hit unsurmountable obstacles with the competition authorities. The new airline will fly under the Delta flag, be based in Atlanta and employ 75,000 people.

Airlines in the US are seen as under great pressure to consolidate as they face a range of challenges including high fuel costs, a weakening domestic economy, and competitive threat from European operators.

Delta and Northwest both came out of bankruptcy last year. Delta believes that the takeover will generate $1 billion (£500 million) in annual savings but it has said that no hubs will be closed. The two operators have very little geographical overlap so the merger will initially take no capacity out of the system. The takeover is likely to take months to complete. (source: Timesonline)

One of the key contenders, Joseph Brandon, to take over Berkshire Hathaway when Warren Buffett eventually retires was taken out of the running yesterday after he resigned amid federal pressure over a fraud case. Mr Brandon stepped down as chief executive of Berkshire's General Re insurance group.

His departure comes after the convictions in February of four of the firm's former executives for fraud. Franklin “Tad” Montross, General Re's co-president, will assume Mr Brandon's position immediately.

The defendants helped to add $500 million (£250 million) to AIG's loss reserves - a key indicator of an insurer's health, prosecutors said. One AIG executive was also convicted.

Neither the US Securities and Exchange Commission nor prosecutors has charged Mr Brandon with any wrongdoing. However, the conviction of his fellow executives in relation to the AIG case and an ongoing inquiry into General Re appears to have made his position untenable.

Other possible candidates to succeed Mr Buffett included David Sokol, chairman of Berkshire's MidAmerican Energy, and Ajit Jain, who runs the Berkshire Hathaway Reinsurance Group.

Berkshire owns more than 60 businesses, including furniture, jewellery, restaurants, natural gas and corporate jet companies, although its biggest exposure is to insurance. (source: Timesonline)

Silverjet News & 7 Attributes of Leadership

2008-04-14T03:32:00.000-07:00

Following on from our article on the possible sale of Silverjet (10th April 2008 - Silverjet in takeover talks & How to earn from the Credit Crunch) directors of Silverjet have held talks with Lufthansa and Gibraltar’s Bland Group in their search for a buyer. Senior aviation-industry sources say cash constraints have forced the company to put its expansion plans on hold, with two new aircraft that were due to arrive this summer having been delayed.

The company’s share price finished the week at 21p, valuing the airline at £13.5 million. It floated on AIM in May 2006 at 112p, reaching a high of 209p in May last year.

Lufthansa, the German airline has looked at investment in Silverjet as a possible riposte to British Airways’ plans to operate services from continental cities this summer for the first time. Directors have also attempted to drum up interest from Middle Eastern investors, and from the Bland Group, a family-owned Gibraltar investment company.

The talks are thought to be only at an exploratory stage. (source: Timesonline) - Silverjet gets new lifeline

Philips, Europe’s biggest consumer electronics manufacturer, suffered a 28% drop in its core profits as its key TV business was hit by deepening losses.

The group warned that it would feel more impact from the global credit crunch with a softening in “mature economies”. Phillips posted a drop in first quarter profits to €265 million (£219 million) follows last week’s sharp profits drop at Philips’ US rival General Electric.

Operating losses in the television division deepened to €95 million compared with €51 million for the same period last year. Philips recently said it would stop making televisions for the North American market following continued losses.

Philips' sharp drop in core profits comes against a backdrop of a 75% fall in overall profits after the electronics group pulled out of much of its electronic chip interests last year. The company is trying to refocus on areas, which offer more stable earnings.

Shares in Philips fell 2.5% to €23.3million (£19.4 million) in early trading. (source: Timesonline)

A MUST READ

7 Attributes of Leadership:
http://life.halcode.com/archives/2008/04/13/the-7-attributes-of-leadership/

Google hires controversial banker

2008-04-11T05:55:00.000-07:00

Google has hired controversial banker Frank Quattrone as a strategic advisor to help meet the threat of a potential takeover of Yahoo by Microsoft.

At Credit Suisse, Mr Quattrone once earned $120 million (£60 million) in one year and underwrote some of the biggest dotcom boom flotations. Frank Quattrone was accused by Federal prosecutors in 2003, as the internet boom had turned to bust, of forwarding an e-mail to colleagues in December 2000 suggesting that it was “time to clean up those files.”

Over 25 years, Quattrone led teams at Morgan Stanley, Deutsche Bank and Credit Suisse, which were responsible for 400 mergers valued at more than $500 billion (£250 billion).

Last month, Quattrone announced that he and some former colleagues had started Qatalyst Group, a tech-focused investment-banking boutique based in San Francisco, to provide merger and corporate finance advice to technology companies.

Yahoo announced on Wednesday it had agreed to a test of whether it should turn over its Web search advertising sales to Google so it can focus on other efforts.

Analysts say Google appears to have held back from getting involved in the Yahoo-Microsoft deal until it had antitrust clearance for its own $3.4 billion (£1.7 billion) DoubleClick acquisition, closed a month ago. (source: Timesonline)

Yahoo and Google, the world's two biggest search engines, have announced a two-week experiment that will see them share advertising space. During the pilot, Google will be able to place ads alongside 3% of search results on Yahoo's website.

Analysts say the move is designed to frustrate Microsoft, which has offered to buy Yahoo for $44.6 billion (£22.6 billion), or extract a higher offer. The news came as both sides were reported to be forging other alliances.

Microsoft and News Corporation are discussing making a joint bid for Yahoo, according to the New York Times. The idea would be to combine three of the world's most visited websites: MySpace, Yahoo and MSN.com.

Microsoft criticised Yahoo's advertising trial with Google, saying any lasting deal would not be in the consumers' interests. "Any definitive agreement between Yahoo and Google would consolidate over 90% of the search advertising market in Google's hands. This would make the market far less competitive," Brad Smith, Microsoft's General Counsel said.

But Yahoo said the testing did not necessarily mean that "any further commercial relationship with Google will result". Microsoft chief executive Steve Ballmer on Saturday gave Yahoo three weeks to agree to the company's offer or risk having the offer lowered. (source: BBC News)

Silverjet in takeover talks & How to earn from the Credit Crunch

2008-04-10T04:10:00.000-07:00

Rumours are that Silverjet, the business-class only airline, was in takeover discussions after receiving a bid approach, which led to shares soaring to 43% to 21.75p.

EasyJet has been rumoured as a potential predator since Silverjet appointed Amir Eilon, a former board member of EasyJet and a close friend of easyJet's founder Stelios Haji-Ioannou, as a non executive. However, a move into business class only flights would be a change of strategy for easyJet whereas British Airways might be more interested since it has already announced plans to launch business class only flights to New York next year from London City airport, using two A318s.

SilverjetSilSilverjet’s planes have been flying only slightly more than half full and it has had to battle with a soaring fuel price as well as the credit crunch hitting demand for business travel and struggled to break even last month.

The struggle of the airline was clear after the Reuben brothers, who lent the carrier £10 million before Christmas, declined to convert their loan into shares earlier this year. Until today's news of a bid approach, the shares have slumped from 200p a year ago to 12.5p last week. (source: Timesonline) - Silverjet gets new lifeline

A messy legal battle with BSkyB over Virgin Media’s bid for ITV and a fall in customer numbers in 2007 contributed to the broadband giant missing a £1.3 billion target for cash that Virgin generated.

Virgin’s top six executives were awarded a total of just over $20 million (£10 million) in pay and share awards, compared with $50 million (£25 million) accrued by the seven top earners the previous year.

Steve Burch, who left abruptly as chief executive last August after disagreements at the top of the company, saw his total fall from $11.4 million in 2006 to $3.4 million. His base salary for the year was cut from $722,115 to $476,297. However, he received a further $1.5 million payment (twice his salary) on termination of his contract.

The total of Jim Mooney, executive chairman, fell from $7.29 million to $5.19 million.

Neil Berkett, who was promoted from chief operating officer to chief executive last month, was awarded $4.3 million, down from $5.1 million in 2006. This included a base salary of $850,723 (against $783,233 in 2006) and included compensation, such as insurance and private medical cover, worth $219,454.

Virgin Media blamed the failure to reach its target operating cashflow on intense competition and falling product prices in the UK. The shares have also fared poorly, falling from $29.39 at their peak in July to $14.02 yesterday.

Virgin’s second-quarter results for 2007 showed that it had lost more than 70,000 customers. However, it has since been clawing them back, with 13,000 added in the third quarter and 24,400 in the fourth. (source: Timesonline)

HOW TO BENEFIT FROM THE CREDIT CRUNCH

PRIVATE INVESTORS have made stunning profits of more than 1,000% during the credit crisis by betting that share prices will fall. However, some UK stocks have beaten the turmoil with gains of almost 180%.

Markets have suffered their worst quarter for five years, with the FTSE 100 share index down 12%, the poorest three-month performance since the third quarter of 2002.

Many investors have watched in dismay as the value of their funds has slumped; the average UK unit trust and pension fund has dropped 6% over the past three months.

The brave, however, have made big profits by using spread-bets, contracts for difference (CFDs) and fixed-odds financial bets. These tools, which enable you to “short-sell” – or make money by betting that shares will fall – were once the preserve of hedge funds and are not without their critics.

However, the techniques are now being exploited by a growing number of ordinary investors – with some spectacular results. Joe Paterson from Fulham, southwest London, made a £25,500 profit betting that the share price of the banking giant Citigroup would plunge earlier this year. His winnings represent a 1,020% return on his original £2,500 bet.

Paterson, 24, a sales and marketing manager, said: “During the credit crisis I have been focusing on banking shares. I also made good profits betting that Barclays would fall but sadly missed Northern Rock.”

Trading in CFDs has jumped by 292% over the past year, and it’s not just City professionals who are taking advantage.

Roy Camps, a self-employed painter and decorator from Witney in Oxfordshire, has taken to trading CFDs in winter. He said: “I could spend the winter months shivering on a building site or sitting in the comfort of my home and trading the markets. It’s not without risks. Overall this winter I’m about even in terms of profits and losses, but I have had big successes: I made £6,500 in 20 minutes betting that the dollar would weaken against the Swiss franc.”

Investors should be under no illusions about the risks. Only one in five spread-betters makes money, according to research by City University’s Cass Business School. However, there are things you can do to limit losses. Firms allow a “stop loss” that closes the bet if it moves against you.

If this sounds too risky, or complex, it is still possible to make money trading shares in the conventional way.
Although the FTSE 100 has

dropped 12% since the market’s peak about nine months ago, a closer look reveals that about a quarter of stocks are worth more today than they were then.

The winner in the FTSE All-Share index is the oil-equipment supplier Wellstream Holdings, up 177% over the past nine months. In the FTSE 100, Cairn Energy, also an oil explorer, is top with a 65% gain. The brewer Scottish & Newcastle is up 25% and defence group BAE Systems has risen 23%.

Henk Potts at Barclays Stockbrokers said: “The mining sector has hugely outperformed the broader market over the past nine months as emerging markets continue to demand ever-increasing amounts of commodities. Oil stocks and related industries have also performed well.”
But which shares are tipped for success now? We asked City fund managers and analysts to pick the companies they think can still make money.

British American Tobacco
Tobacco stocks are renowned for their ability to do well when markets are falling because they have strong brands, consumers continue to buy cigarettes even when conditions are tough and they are committed to growing dividends. BAT is favoured by Richard Hunter at Hargreaves Lansdown Stockbrokers: its shares have gained 19% over the past year to stand at £18.92 with a yield of 3.5%.

Vodafone
Investment banks say that companies paying good dividends have a better chance of withstanding further turbulence. Last year, Vodafone, the world’s biggest mobile-phone company, increased its dividend by 11% to 6.76p and yields 4.3%, which is high for a former growth stock. Morgan Stanley, the investment bank, expects it to raise its dividend by 10% a year until at least 2010. The shares have gained 15% over the past year to 159.20p.

Land Securities
Property stocks have taken a pounding over the past year: Land Securities is down 29% from £21.61 to £15.44. However, Nick Raynor at the Share Centre, a stockbroker, said: “The decision to split up the £15 billion Land Securities property portfolio into three separately quoted businesses should prove attractive. Due to the ongoing market volatility, this should be seen as a long-term investment but is still a worthwhile buy.” The shares are yielding 3.4%.

Reckitt Benckiser
Raynor also recommends Reckitt Benckiser, the world’s largest household cleaning-products group, which owns brands such as Vanish and Harpic. “The company’s strategy is simple and well executed,” he said. “As long as its core products remain strong, the constant stream of innovations should keep sales moving upwards.” The shares have gained 6% over the past year to £28.10 and are yielding 2%.

Thomas Cook
The global economy is slowing, household costs are rising and oil prices are high. It doesn’t sound like a good time to back a travel group such as Thomas Cook. But David Cumming at Standard Life said: “The negative effects of higher fuel prices and pressure on consumer spending will be more than offset by management actions to turn round the business.” The shares have dropped 4% over the past year to stand at 299p and now yield 1.9%.

SHORTING EXPLAINED
CONTRACTS FOR DIFFERENCE When you trade CFDs you agree to receive the difference between the price when the contract is opened and the price when it is closed. If you think the value will rise, you go ‘long’. If you think it will fall, you go ‘short’.

Say you thought shares in a company were about to drop and took out a CFD to go short of 1,000 shares at 100p. The contract value would be £1,000, but you would put down only about 20%. If you closed the contract at 95p, the difference in price would be 5p and you would make £50. If it rose to 120p, you would lose £200.

SPREAD BETS When you spread bet, the bookmaker will quote you a spread for a share or the level of an index or asset at a given date, and you bet on how far you think it will move above or below the spread.

Last week CMC Markets was quoting 5,933 to 5,936 for the FTSE 100 in June. If you thought it would beat that, you could bet £10 a point above 5,936. If you wanted to short-sell, you could bet below 5,933. If the Footsie finished at 5,900 and you had bet on it falling, you would have made £330 (£10 times 33). If you had closed the bet at 6,000 you would have lost £670

Airline News

2008-04-09T04:05:00.001-07:00

After an already delayed programme, Boeing is expected to announce today that its 787 Dreamliner has been delayed by 18 months. This setback will cost the company billions of pounds and will make this revolutionary aircraft enter into service at the end of 2009.

The delay will affect all airlines that have ordered the 787, including British Airways and Virgin Atlantic. The delay is particularly bad for BA as it means the British flag carrier might not get the aircraft in time for the 2012 Olympics. BA needs the 787 to increase capacity and reduce operating costs.

The Dreamliner has taken orders worth more than $150 billion (£76 billion). It was scheduled to enter commercial service next month but this initially slipped to early 2009 and has now been delayed again.

Boeing is also thought to be ready to postpone or even scrap one of the three variants of the aircraft to enable its engineers to focus on solving existing problems.

The likely victim will the 787-3, a high passenger density model designed for the Japanese market. The 787 is a radical new design because its fuselage is entirely made out of composite materials — essentially carbon fibre.

Airlines are likely to demand billions in compensation from Boeing and the company will also have to allocate huge resources to prevent the problems worsening. Its share price has already fallen 25% since the 787 delays were first announced, wiping more than $18 billion (£9 billion) from Boeing’s value. (source: Timesonline) - Even more delays for the Dreamliner, BP fined for a record amount (Article on Dreamliner delays) (Also see Wednesday 12th December 2007 entry for more on this.) - Nintendo Wii dominated Argos toys sales over Christmas (article on delays effecting Qantas)

Hundreds of passengers have been left stranded after the Hong Kong airline Oasis stopped flying and applied to go into liquidation. Oasis first flew in October 2006, offering flights from London to Hong Kong for as little as 1,000 Hong Kong dollars (£65) each way. It later added flights from Hong Kong to Vancouver. (source: BBC News)

A further cancellation of flights is expected from American Airlines today after cancelling about 500 flights on Tuesday. Wednesday after cancelling about 500 on Tuesday. The cancellations came after American grounded its MD-80 aircraft to conduct extra safety inspections on wiring.

The FAA has been clamping down on safety inspections and several airlines have been forced to ground planes. Two weeks ago the Federal Aviation Administration (FAA) raised concerns about the wiring inspections that led to planes of American Airlines being grounded.

Southwest, Delta and United have also grounded some of their fleets for safety inspections. The FAA said that it had checked several American MD-80s and decided that the work carried out two weeks ago did not meet its standards. The airline runs about 2,300 flights a day, more than one third of which use MD-80s, mainly on mid-range flights. (source: BBC News)

Microsoft gives Yahoo! ultimatum

2008-04-07T03:50:00.000-07:00

Microsoft has given Yahoo! a three-week deadline to accept its offer for a buy out at $44.6 billion (£22.3 billion). Microsoft CEO Steve Ballmer said his company would take its case directly to Yahoo's shareholders if Yahoo's directors did not respond by 26 April 2008.

Since the original bid on 31 January 2008 which Yahoo! rejected, has since explored alliances with other firms, but no offer has surfaced. In a letter, Mr Ballmer acknowledged that such negotiations were underway, but wondered why Yahoo was not talking to Microsoft too.

Mr Ballmer said his company's offer - 62% above Yahoo's market value at the time - had grown stronger as time had passed. "We believe that the majority of your shareholders share this assessment," he wrote, adding that Microsoft would take its case directly to them and work to elect a new board of directors if they did not respond within three weeks.

Last month, Yahoo estimated it would almost double its operating cash flow over the next three years and generate $8.8bn in revenue after costs in 2010. (source: BBC News) - Microsoft serious about takeover & Businessman of the Month, Yahoo! and AOL continue merger talks, Yahoo! rejects Microsoft offer, Microsoft not intending to raise its stake in Yahoo!

Thomas Cook the travel agency has snapped up bespoke holiday firm Elegant Resorts. Founded in 1988, the shareholders Geoff Moss and Barbara Catchpole have sold the business for an undisclosed sum.

The firm's packages feature luxuries such as helicopter transfers and champagne on arrival, and last year catered for more than 20,000 travellers. Thomas Cook is planned to run the business as a standalone unit with the current management team remaining in place.

Group chief executive Manny Fontenla-Novoa said "Elegant Resorts has a very strong brand name, associated with luxury, style and bespoke holidays and fully supports our strategic aim to become a leading independent travel provider."

Elegant Resorts currently has 160 staff, with three overseas offices in Barbados, Dubai and Mauritius. Last year it had total gross assets of £22.3 million. Chairman Mr Moss and PR director Ms Catchpole are the main shareholders, with other staff also holding shares.

The deal follows the £21.8 million paid by the travel giant hotel for booking website Hotels4U.com in February, which boosted its presence in the independent travel sector.

Thomas Cook shares were up nearly 1% today. (source: The Independent) -Thomas Cook on track for record profits

Apple iTunes to be taken on by MySpace

2008-04-04T00:51:00.000-07:00

Apple iTunes is taken on by the world’s largest social networking group, MySpace, as they have plans to set up a music downloading service. Three of the “big four” record labels have signed up to the service, which will give users access to the music of big artists. With MySpace’s 30 million users a month, it is viewed as an ideal hub to showcase new music.

MySpace will be able to cash in on its vast community of loyal users. MySpace has more than 25 localised websites, in countries including, India, Brazil and Australia. The site will also sell ringtones, artist wallpaper, ticket sales and merchandise. There will also be a number of advertising-funded free services, from free downloads to video clips.

The online music store iTunes has sold more than four billion songs since its launch in 2001, and claims to be the No one music retailer in the US. However, iTunes users can only listen to song clips through the Apple store.

The launch comes as welcome news to the music industry, with many concerned about a lack of competition for iTunes in the digital music market. In the US, for example, iTunes takes more than 70% of digital download sales. Concerned about Apple’s increasing influence over its business, the music industry has been keen to see other sizeable players. (source: Timesonline)

After 18 years of offering the in-flight beauty therapy for its upper class executive customers, it appears as if Virgin Atlantic might withdraw this service. The airline has called its entire crew of 280 in-flight beauty therapists to London next week for a review of its Upper Class offering. This service was introduced to allow upper class travellers to arrive at their destination looking relaxed and refreshed with treatments such as the Handsome Hands mini-manicure and the Back in the Clouds upper back massage.

With a much smaller fleet than rival British Airways, Virgin uses the quirky treats to woo transatlantic passengers away from its more stuffy competitors which offer many more departures each day from London to the US.

However, the move appears to underline fears that the worsening economic climate is hurting business air travel and that mounting costs for airlines, particularly for aviation fuel, are dragging down margins.

“We are calling our in-flight beauty therapists in to get their input into the product and service review of our Upper Class cabin. We constantly look to review our Upper Class service to make sure that our investment is where it should be and that it is meeting the expectations of our customers,” a spokeswoman for Virgin Atlantic said.

One aviation analyst said: “It could be a huge mistake for Virgin to get rid of its service frills. Virgin’s treats have always been hugely enjoyed and a large part of the brand’s identity. Airlines are so competitive on price now that passengers look at other things, and Virgin doesn’t have the frequency of services that other airlines do because it only has 38 planes” (source: Timesonline)

Luqman Arnold is understood to have built up an 0.7 per cent stake in UBS, in a bid to push through a break up of the struggling Swiss bank. A former chief executive of UBS, Mr Arnold has been acquiring his shares, worth $450 million (£226 million), through Olivant, his London investment firm.

It is thought that he is also pushing for the separation of the bank’s investment and private banking arms and the sale of its asset management division. His proposals are detailed in a letter sent to Sergio Marchionne, the UBS chairman and recommend drastic changes to the bank’s board.

Mr Arnold’s activist campaign follows the announced resignation of Marcel Ospel, UBS’s chairman, earlier this week. Mr Ospel said that he was quitting as he revealed that losses had more than doubled to $37 billion (£18.6 billion). Mr Arnold, who recently led a failed rescue bid for Northern Rock, left UBS in December 2001 due to “differences of opinion,” between him and the board. (source: Timesonline)

Virgin to expand to Middle East

2008-04-02T01:00:00.000-07:00

Virgin is looking to expand to the Middle East as it held informal talks with Dubai International Capital (DIC) about securing investment backing from the $12 billion (£6 billion) sovereign wealth fund. It is understood that financial support could come from a sale in a stake of Virgin Active which is valued at £1 billion or a joint mobile phone venture. Sir Richard Branson currently owns 75% of Virgin Active.

DIC bought Travelodge, the hotel group, for £675 million two years ago, and also owns Tussauds, the entertainment group. The fund also has large equity stakes in Daimler, Sony, EADS and HSBC and became one of Virgin's backers in the failed bid for Northern Rock.Virgin plans to expand aggressively some of its largest businesses, such as its airline, mobile phones and gyms. It wants partners to help to fund that growth, particularly in new markets such as India, East Asia and the Middle East. Virgin Active is also looking at expansions plans to countries such as Italy, Portugal and South Africa.

Virgin could sell a stake in the Active division to DIC or to another sovereign wealth fund if it determines that the financial markets, still coping with the waves of the credit crunch that began in the United States, are too turbulent for an IPO. Sir Richard Branson does not have a good track record with the stock market and would therefore firstly consider a private venture.

Middle Eastern wealth funds could also be interested in Virgin's plans to establish its pay-as-you-go mobile phone model in the region. Virgin is understood to be bidding already for spectrum licenses in the Middle East.

Sir Richard Branson has handed day-to-day control of the Virgin empire, which has total revenues of about £10 billion a year, to an investment team. Their strategy is to operate as “branded venture capitalists”. This involves investing in a sector such as health clubs, rebranding the business with the famous Virgin name and then seeking other investors to help to develop the asset. (source: Timesonline)

The credit crunch and the pressure of the sub-prime mortgages has shown its strain as Marcel Ospel, UBS’s chairman, once fêted as the most brilliant banker in Europe, said that he was quitting. This is after he revealed that losses had more than doubled to $37 billion (£18.6 billion). This is equivalent to three times the annual wages bill of UBS’s 80,000 staff worldwide and much larger than the next most exposed banks so far, Merrill Lynch, with $24 billion (£12 billion), and Citigroup, with $18 billion (£9 billion).

UBS has been forced into a second emergency capital-raising to shore up its balance sheet, announcing a fully underwritten SwFr15 billion (£7.5 billion) rights issue. Shares on both sides of the Atlantic soared as investors welcomed the UBS move to address its sub-prime issues, and Lehman Brothers successfully raising $4 billion cash. The FTSE 100 closed up nearly 3 per cent at 5,852.6, while the Dow soared 391.5 points to close at 12,654.4.

Jerker Johansson, the newly appointed chief executive of the investment bank, who took up his job on March 17, is understood to be sifting the options. His background is in equities. Peter Kurer, UBS’s in-house general counsel, was named successor to Mr Ospel, who will step down at the annual meeting this month. UBS shares rose more than 12% on hopes that the bank could draw a line under its ill-fated foray into American sub-prime.

In the wake of UBS’s announcement, Gordon Brown called for better daily cooperation between the world’s financial regulators and better disclosure from banks to give early warning of market turbulence. Mr Brown said that he will use talks with international leaders before next week’s G7 meeting to call on financial institutions to make prompt and full disclosure of losses. Possible remedies to deal with the crisis include a temporary suspension of capital requirements, taxpayer-funded recapitalisation of banks and public purchase of mortgage-backed securities (source: BBC News, Timesonline & Reuters)

Battle over Clear Channel

2008-03-27T06:31:00.000-07:00

Bain Capital and Thomas H Lee Partners had agreed to acquire Clear Channel as part of a mega buyout funded by a consortium of six banks, including Citigroup. The battle over Clear Channel Communications however escalated today after a US judge issued a temporary order directing six banks not to interfere with the $20 billion (£10 billion) merger by refusing to fund it or demanding new terms.

But the private equity firms are determined to press ahead with the deal and late on Wednesday they filed lawsuits in New York and Texas, accusing the banks of backing out of their commitments.

Clear Channel itself has also joined in the Texas lawsuit.

In a statement, Clear Channel said that Judge John Gabriel, of the Bexar County district court in Texas, on Wednesday night found that the company would suffer irreparable harm if the banks refused to fund the merger. Clear Channel had agreed last May at the height of the private equity boom to be acquired by Bain and Thomas H Lee for $39.20 a share.

Citigroup, Morgan Stanley, Deutsche, Credit Suisse, Royal Bank of Scotland and Wachovia had all originally signed up to back the deal. Under the original plans, the six banks were to fund $16 billion (£8 billion) of new debt to take Clear Channel private. (source: Timesonline)

The luxury UK-based brands Jaguar & Land Rover owned by Ford have been sold to Tata the Indian company owned by billionaire Ratan Tata. Tata, India's biggest vehicle maker, is paying $2.3 billion (£1.15 billion) for the British brands after months of negotiations over price and supply relationships.

Although Land Rover remains profitable, Ford has never managed to make money from its investment in Jaguar. Ford has been forced to sell the two companies, based at Solihull and Castle Bromwich in the West Midlands and Halewood on Merseyside, in order to concentrate on its loss-making core US car business, which it hopes to turn around in the next two years.

The $2.3 billion price tag is about half the amount Ford originally paid leading some analysts to argue that the purchase was a mistake. Ford sold its iconic Aston Martin brand to a UK-led investment consortium in a deal worth $955.2 million (£482.4 million) last year. (source: BBC News)

Losses for Borders

2008-03-20T02:42:00.000-07:00

Weakening economy and higher borrowing costs were raised as the issues why Borders, the American-owned bookstore chain, were showing slowing sales and losses in seven of the last eight quarters. Borders could be up for sale after it suspended its dividend and hired advisers to review options for the business.

Chief executive George Jones said: "We will be slowed in our progress and expect that we'll reach them later than originally anticipated. Still, we believe that our strategic plan remains the right path toward achieving these goals. The company is determined that additional capital was required to execute our operating plan. The current credit environment has made many of these alternatives prohibitively expensive or entirely unavailable.”

Pershing Square Capital Management, Borders' largest shareholder, has agreed to bail it out by lending it $42.5 million and making an offer for some of the bookstore chain's international businesses.

The company faces stiff competition from online retailers and grocery stores for sales of books, CDs and DVDs. Shares have dropped by 66% in the last year.

Borders reported a net profit of $64.7 million (£32 million) in the three months to the end of December compared with a loss of $73.6 million (£36.8 million), a year earlier when it took large charges associated with the closing of Waldenbooks stores. (source: Timesonline)

Yahoo! to apply pressure on Microsoft

2008-03-19T04:16:00.001-07:00

The online search engine, Yahoo!, yesterday tried to apply new pressure on Microsoft to raise its hostile takeover offer, after outlining a rosy outlook for the next two years. Yahoo! shared its internal revenue projections with shareholders and claimed that, according to numbers drawn up in December, the board expects sales to rise by more than 70% over the next three years. That would see total sales of $8.8 billion (£4.4 billion) by 2010.

At the beginning of February, Microsoft made an offer to the Yahoo! board outlining its proposals for $31 (£15.5) a share, payable in cash and shares. At the time, the deal valued Yahoo! at $44 billion (£22 billion) – a 61% premium to the Yahoo! share price the day before the approach was made public. (source: Timesonline)

Donald Trump’s top 10 list of things that he always emphasize in all his speeches.

1. Never give up! Do not settle for remaining in your comfort zone. Remaining complacent is a good way to get nowhere.

2. Be passionate! If you love what you're doing, it will never seem like work.

3. Be focused! Ask yourself: What should I be thinking about right now? Shut out interference. In this age of multitasking, this is a valuable technique to acquire.

4. Keep your momentum! Listen, apply and move forward. Do not procrastinate.

5. See yourself as victorious! That will focus you in the right direction.

6. Be tenacious! Being stubborn can work wonders.

7. Be lucky! The old saying, "The harder I work, the luckier I get" is absolutely right on.

8. Believe in yourself! If you don't, no one else will either. Think of yourself as a one-man or one-woman army.

9. Ask yourself: What am I pretending not to see? There may be some great opportunities right around you, even if things aren't looking so great. Great adversity can turn into great victory.

10. Look at the solution, not the problem. And never give up! Never never never give up. This thought deserves to be said (and remembered and applied) many times. It's that important.

The Ben Way story

2008-03-18T03:40:00.001-07:00

The Storey about Ben Way – I thought that it would be so much interesting to publish this then to go on about business news again about the credit crunch etc. Hope you enjoy this. For me this guy is an inspiration to have achieved so much at such an early age. Enjoy!

When Ben Way's teachers told him that his dyslexia would stand in the way of success, he was determined to prove them wrong. His Young Enterprise (YE) company, Grass Heads, produced home-grow grass plants, so Ben spent evenings packing seeds and sawdust into tights. He went on to become one of the first dot com millionaires when he was only fifteen years old. He attracted media attention following his early success, and he also featured in numerous media stories. Before his eighteenth birthday, Ben had negotiated a £25 million deal to launch an internet-based business to business data aggregation service which continues to trade. He has won "New Business Millennium Young Entrepreneur Of The Year" in 2000 which was given to him by (now Prime Minister) Gordon Brown.

However, after a dispute with the investors in 2001 he was diluted out of the business and lost everything. It is reported that he was in the Sunday Times Rich List under Robbie Williams the same day he could not buy a tube ticket.

He then went on to advise both the UK and US governments in 3rd Generation Mobile Technology, before heading up technical and environmental investments and due-diligence for the Rotch Property Group who have over £1 billion in asset management. It was with the latter company that he developed his passion for environmental technologies.

In 2003 he started a successful mobile innovations company that developed one of the first remote monitoring medical devices as well as many other projects, this evolved into the Rainmakers after developing a number of successful innovations for clients and the market. The Rainmakers continues to grow. Due to the success of The Rainmakers, he was able to in 2006, appeared on the Channel 4 TV show “Secret Millionaire” where he gave away £40,000 in a philanthropic act after spending two weeks in Hackney as a volunteer. £20,000 was given to a youth organisation, £10,000 to a young entrepreneur, and another £10,000 as a thank you to one key member of the Hackney community.

He is now regarded as one of the leading experts on web 2.0 the Semantic web and also sits on a one hundred million dollar venture capital fund called Brightstation Ventures. Has been quoted as describing the Semantic Web as "the most powerful development of information management since the creation of the database"

In early 2007 he was invited to join Brightstation Ventures an $100 million (£50 million) technology Venture Capitalist fund as the CIO (Chief Innovations Officer) where he has worked with projects such as miomi and Shiny Media. Launched in 2007a social website HorsesMouth made it into the top 25 UK web 2.0 start ups. In September 2007 he also launched the world’s first POIP service, ViaPost which allows printing of documents over the internet which are then sent by Royal Mail.

The way he is developing new innovations at such an early stage is just astonishing. He refused to give up after he lost everything and proved to be a typical entrepreneur that he can make it again.

Bear Sterns to be sold to JPMorgan Chase

2008-03-17T02:32:00.000-07:00

Bear Sterns the famous investment bank, will be acquired by rival giant JPMorgan Chase for a bargain $236.2 million (£124.2 million). The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

Early indications, though, pointed to continued fear about the stability of the US market, as the dollar hit fresh record lows against the euro, gold broke through 1,015 an ounce and Asian stocks sank. JPMorgan said it will guarantee all business - such as trading and investment banking - until Bear Stearns' shareholders approve the deal, which is expected to be completed during the second quarter.

JPMorgan Chase chief financial officer Michael Cavanaugh did not say what would happen to Bear Stearns' 14,000 employees worldwide or whether the Bear Stearns name would survive. (source: The Independent)

Air France-KLM’s takeover offer for Alitalia, the ailing state airline was accepted yesterday and values it at just €139 million (£107 million), a fifth of its market capitalisation at the end of last week.

Alitalia said two weeks ago that it had less than €300 million (£232 million) in cash remaining, having lost more than €3 billion (£2.32 billion) since 2000, and warned it could be forced to stop trading by the middle of the year. Alitalia's problems over the past 10 years include the emergence of the budget airlines Easyjet and Ryanair, which both now provide stiff competition in the airline's home market. However, the company is also regarded as inefficient and over-manned.

The French company plans to cull 1,600 jobs from Alitalia as it cancels unprofitable routes and eliminates inefficiencies. It has also said it will take over only part of Alitalia's ground services division, which could mean the airline faces more job losses than publicly stated.

This business model is likely to put Air France at loggerheads with Italian trades unions, which must back the deal in order for it to go ahead. The takeover also needs clearance from the Italian government, which may take some time following the collapse of the administration led by Romano Prodi in January.

In addition to the €139 million (£107 million) purchase price, Air France has also agreed to buy out the airline's convertible bond holders for €608 million (£471.3 million), taking its total outlay to €747 million (£579.05 million). (source: The Independent) - (further articles on this Velocity Interactive Group - New Investment Company, ArcelorMittal to by China Oriental Group Co., Alitalia SpA in sight for Air France-KLM)

Virgin Mobile USA lost £124 million

2008-03-14T02:37:00.000-07:00

Virgin Mobile USA that was set up six years ago between Sir Richard Branson’s Virgin Group and Sprint (the US telecoms company) has lost $250 million (£124 million) after an 85% collapse in the company’s share price since its flotation last year. Poorer than expected fourth-quarter results caused the mobile phone operator’s share price to drop a further 41% yesterday to close at $2.46 (£1.23) in New York.

The initial public offering (IPO) for Virgin Mobile USA took place in October and Virgin Group reduced its holding from 42% to 37%.

The listing price was $15 (£7.50) a share and in early trading on the first day. However, the price has slid since then and the company now has a market capitalisation of only $130 million (£65 million). This has reduced the value of Sir Richard’s holding from $295 million (£140 million) to $48 million (£24 million).

The poor performance of Virgin Mobile USA is an embarrassment for the Virgin Group, which promotes itself as a private equity-style investor. After years of treating stock markets with suspicion, Sir Richard’s asset managers have looked at a number of possible IPOs to release value in the group’s divisions but the rapid drop in value within Virgin Mobile USA may encourage Virgin Group to keep companies private.

Service revenue rose 8% to $293.6 million (£148.28 million) and new customer additions were 958,000, down from 1.29 million after the company refused to cut prices in the run-up to Christmas.

Virgin Mobile USA has also come under increasing pressure from national carriers expanding into its pay-as-you-go space. The company expects revenue in 2008 will be flat and earnings to be between $105 million (£53 million) and $130 million (£65.6 million). These forecasts were also lower than Wall Street expectations. (source: Timesonline)

Michael (37) and Xochi (36) Birch made an estimated $600 million (£295 million) yesterday after the sale of their 70% stake in Bebo, the social networking site, to the AOL division of Time Warner for $850 million (£429.9 million) in cash. The Briton and his Californian wife set up Bebo – their sixth internet business – in 2005 and are not expected to remain with the company, which is the second most popular social networking site in the UK and the third globally after MySpace and Facebook.

No financial data regarding Bebo’s performance was released yesterday, although Randy Falco, chairman and chief executive of AOL, contrasted the price that Time Warner had paid with the $260 million (£125 million) that Microsoft paid for a 1.6% stake in the $15 billion (£7.5 billion)-rated Facebook. Bebo has 40 million users. Facebook is thought to have generated $100 million (£47 million) in revenues in 2007, which is likely to represent a benchmark for Bebo.

The plan is to develop Bebo internationally, with new sites around Europe, while at the same time trying to promote Bebo using AOL’s AIM instant messenger and ICQ chat technologies. (source: Timesonline)

Profit increase for Morrisons

2008-03-13T03:03:00.001-07:00

The troubled Morrison supermarket, today signalled a turnaround in fortunes by reporting profits up 66% and a pledge to return £1 billion to shareholders over two years. The capital return, through a share buy-back, was announced as the supermarket chain's veteran chairman, Sir Ken Morrison, confirmed that he will retire from the company from today.

Morrisons began to struggle after difficulty integrating rival Safeway, which it acquired in 2004. The company said pre-tax profits rose from £369 million to £612 million for the 12 months to February 3, 2007, on total sales up 6% to £13 billion. Like-for-like sales rose 4.6%, a fall on 5.2% in the previous period. Total dividend increased 20% to 4.8p, up from 4p.

Morrisons plans to open eight new stores in 2008 and extend 19 with an additional 100,000 square feet of selling space.

Keith Bowman, an analyst at Hargreaves Lansdown, said that “all the group’s key financial metrics were moving in the right direction, noting that its shares had out performed rival Tesco by 13.5% in the last six months and that the acquisition of Safeway was now behind it. However, the remaining management at Morrisons will know that they cannot afford to be complacent, today's success comes from a low starting base and the comparatives will become much harder going forward. In addition, UK consumers under pressure from numerous angles will not prove easy to satisfy.” (source: Timesonline)

Ian Kerr to be replaced by Bert Pijls

2008-03-12T06:57:00.000-07:00

Ian Kerr, the chief executive of Egg since November 2006, has resigned after the internet bank was accused of unfairly withdrawing credit cards from thousands of responsible customers. Mr Kerr will be replaced by Bert Pijls, the country manager for Citigroup, Egg’s parent company in the Czech Republic.

Egg last month sent out an unexpected warning to 161,000 card users saying it would end their agreements in 35 days because they had a “higher than acceptable risk profile”. The cards were withdrawn on Thursday last week.

Egg has even blocked some borrowers with perfect credit histories from using their cards. Experts said the bank, which has 2.3 million card customers, was effectively penalising these borrowers for being good with their money because they were not profitable customers, and that other banks are likely to follow Egg’s lead.

Mr Kerr, the former HBOS retail banking head, was also the head of UK consumer banking for Citigroup, which bought Egg from insurer Prudential last May. George Awad, Citigroup’s consumer chief executive for Europe, the Middle East and Africa, said he was disappointed to loose Mr Kerr, but respected his decision.

Mr Pijls will move to London this month from the Czech Republic where he turned the consumer franchise around with high double-digit year-on-year growth, according to Citigroup. (source: Timesonline) - Egg dumps millionaires

Financial losses for EADS

2008-03-11T03:47:00.000-07:00

Europe’s leading aerospace group, EADS, the owner of the Airbus aircraft company, suffered a heavy financial loss last year, burdened by a weak US dollar and restructuring charges. They recorded a net loss of €446 million (£341 million) compared with a €99 million (£75 million) profit in 2006. They are expected to deliver more aircraft this year with delivering revenues of €40 billion (£30.3 billion), up from €39.1 billion (£29.6 billion) in 2007.

The aerospace group said it hoped to capture 700 aircraft orders in the current year and deliver 470 planes to customers. In 2007, EADS delivered 453 units to airlines, up from 434 in the previous year. Airbus however still suffered a €1 billion revenue hit from the weakening US dollar while profits were hurt by the cost of restructuring charges.

EADS chief executive, Louis Gallois, was optimistic, forecasting earnings before interest and tax of €1.8 billion (£1.36 billion) in 2008. Mr Gallois said “there had been a promising start to 2008 with improvements across the board and recent success in the US military aircraft market. EADS is gaining speed and altitude. Our short-term focus is now to further improve programme management and to secure the ramp-ups ahead."

The annual loss for EADS was higher than market expectations of some €320 million (£242.4 million). The Airbus business was affected by €881 million (£667.42 million) in provisions for restructuring and delays in the A380 and the A400M heavy lift aircraft. The A380 secured 33 new orders during the year making a total of 180 "firm orders" for the superjumbo aircraft. The Airbus order book stood at €283 billion (£214.39 billion) at the year end, up from €210 billion (£159 billion). (source: Timesonline)

World Duty Free to be sold to Autogrill

2008-03-10T06:11:00.000-07:00

Italian caterer Autogrill spent $1.5 billion (£742 million) on airport retail assets on Monday, making it the world's top airport retailer and easing the financing problems of one seller, Spain's Ferrovial.

Autogrill said it would buy World Duty Free from construction and services group Ferrovial and acquire full control of another airport retail operation, its joint venture Aldeasa, for a total 990 million euros (£742 million).

The Italian catering giant paid Ferrovial 715 million euros for World Duty Free funds, which should help the Spanish company towards refinancing of £9/£10 billion pounds in debt related to its purchase of British airports operator BAA in 2006.

Autogrill, which operates restaurants on motorways and in airports, also bought the 49.95% stake it does not own in Aldeasa from Altadis, now controlled by Imperial Tobacco Group Plc after a takeover last year.

Autogrill, which bought Britain's Alpha Airports last year, said it expects annual synergy benefits of about 40 million euros by 2011. It said the acquisitions would add to earnings from 2009 and be neutral this year. (source: Reuters)

The World's Richest People

2008-03-06T02:48:00.000-08:00

If you want to become one of the richest people in the world, then, change you nationality its seems to be Russian. The average age of Russia’s elite is 46, bringing the overall average of the world’s richest to 61.

Warren Buffett has finally unseated Bill Gates from the top spot for the first time in 13 years. The surging share price of Berkshire Hathaway saw his personal wealth rise to $62 billion (£31 billion). This is up by £5 billion from a year ago.

Gates is now worth $58 billion (£29 billion) and is ranked third in the world. He is up $2 billion (£1 billion) from a year ago and would have been perhaps as rich -- or richer -- than Buffett had Microsoft not made an unsolicited bid for Yahoo at the beginning of February.

Mexican telecom tycoon Carlos Slim Helú is the world's second-richest person, with an estimated net worth of $60 billion (£30 billion). His fortune has risen $11 billion (£5.5 billion) since last March. Fourth on the list is Laksi Mittal from Ancelor Mittal the world’s largest steel provider. The world’s youngest US billionaire is the CEO and owner of Facebook, Mark Zuckerberg with an estimated wealth of $1.5 billion (£750 million).

Virgin Mobile India to be derailed by Vodafone

2008-03-05T07:48:00.000-08:00

A few days after going live with sell mobile phones in India, the world’s fastest-growing market, it seems like Sir Richard Branson faces being derailed by Vodafone. On Sunday, Sir the Virgin Group unveiled a partnership with Tata Indicom, under which the Indian company will market a mobile service aimed at young consumers using the Virgin brand.

However, a very powerful industry group, which includes Vodafone, the world's largest mobile operator, has now demanded that the Indian Government declare the deal void. The Cellular Operators Association of India claims Virgin is entering the market via the backdoor as an illegal "mobile virtual network operator" (MVNO), where it effectively buys mobile capacity wholesale from Tata and sells it on under its own brand - a model not permitted in India.

A spokesman for the Indian Department of Telecommunication said that Virgin could be ejected from the Indian market. "The spectrum [used by the Virgin-branded mobile service] was allocated to Tata. It is up to Tata to intimate any transfer of that spectrum to the department," he said.

Virgin runs virtual networks in six countries. When it launched in 1999, Virgin Mobile UK was the world's first MVNO – breaking with tradition by not having its own network but using another service provider's. Being denied access to India's explosive growth would be a severe blow to Virgin. While Western markets are largely saturated, it is estimated that more than 870 million of India's 1.1 billion population are yet to own a mobile.

It is only two years since India raised the ceiling for foreign ownership in telecoms groups to 74% from 49%, a move that led to a flood of new investment. The Indian authorities have received more than 550 applications from more than 45 domestic and foreign firms to launch mobile services in the country. (source: Timesonline)

Record fines for Microsoft

2008-02-28T02:27:00.000-08:00

Yet again, Microsoft was fined, but this time a record €899 million (£683 million) by the European Commission yesterday. This came as Microsoft received its third financial penalty for failing to comply with a landmark antitrust ruling issued four years ago.

As the battle between the American software giant and European regulators enters its tenth year, Microsoft has now been fined almost €1.7 billion (£1.28 billion) for abusing its dominance of PC operating systems through its Windows software. Microsoft had unfairly tied its web browser, Internet Explorer, to its Windows operating system, and was making it difficult for competitors to work with Windows by not disclosing sufficient interoperability information.

Under the ruling of March 2004, Microsoft was instructed to make complete and accurate interoperability information available on reasonable terms to competitors so that they could develop their own operating systems for servers.

The fine is based on a 15-month period of non-compliance and is considerably larger than the original €497 million (£376 million) penalty the company initially received.

Microsoft said that it would review the decision. If it decides not to appeal, a line will have been drawn under the original Commission ruling. However, Microsoft will have to update the interoperability data it makes available continuously and licensees may lodge complaints if they believe that they are being unfairly treated.

Microsoft Fines:
March 2004 Abusing its dominant position: €497 million
July 2006 Failure to comply with March decision: €280.5 million
Feb 2008 Charging rivals unreasonable fees: €899 million (source: Timesonline)

Royal Bank of Scotland unveiled profits of £10.3 billion. Underlying profits at the UK's second biggest bank were 9% higher than the previous year. This is inline with City forecasts.

Losses at Royal Bank of Scotland due to the credit crunch totalled £1.6 billion. UK business banking also lifted operating profits 11% to almost £2 billion, offsetting the decline in earnings from investment banking.

Chief executive Sir Fred Goodwin said prospects for 2008 were "difficult as ever to predict but there was good momentum behind the enlarged bank following the acquisition of ABN Amro.”

The bank added today that its capital remained within target ranges and also cheered investors with a 10% hike in the annual dividend. (source: The Independent)

Egg dumps millionaires

2008-02-27T01:04:00.000-08:00

Egg, the online bank, who dumped 161 000 customers last month has also dumped at least three millionaires as Egg considered them a bad credit risk. Egg purged its books of people it feared might fail to pay their bills.

AA correspondent said that one of the millionaires’ gross income last year was £1.1million and that he had worked for one of Britain's 50 largest companies for 26 years. The millionaire said “My credit rating is excellent and I even happen to have shares worth £180,000 in a Citigroup account. I find it outrageous that this bank can make these statements and get away with it.”

Egg, which was set up by Prudential, the UK insurer, was bought by Citigroup, the US banking giant, last May. Egg said that Citigroup immediately began combing through its 2.3 million customer base for bad credit risks. The bank wrote to 161,000 customers last month to tell them that their cards would be cancelled in 35 days' time because they presented a “higher than acceptable risk profile”.

A spokesman for Egg said yesterday that it did not look solely at credit histories when deciding whether to cut off customers. “Some customers may be up-to-date with payments and have a good record with the credit agencies but our models might show them to pose a higher future risk than we're comfortable with,” the spokesman said.

The spokesman denied that Egg had shed customers who paid off their card every month because they were not profitable. “Profitability is not a factor in our decision,” he said. Egg does not receive interest from these customers but it does receive a fee from every transaction.

Customers aged between 34 and 49 are most likely to have their credit limits cut or their cards cancelled, the website found, while borrowers younger than 25 who have very little credit history and no property are more likely to have their limits extended. (source: Timesonline)

Google, the internet giant, suffered a 7% decline in adverts viewed in January, compared with the month before. Google shares have fallen nearly 19% in the past three months. Analysts said yesterday that despite this fall, web searches had increased 10% in the same period.

Benjamin Schachter, a UBS analyst, cut his 12-month target on Google shares from $650 to $590, a new low among Wall Street analysts. He said that international growth, including in Britain, Google’s second-largest market, was a concern. Shares in Google tumbled as low as $446.85 (£231), down $39.59 (£20.5), or 8.1%, in early trading on Nasdaq, but recovered later to close at $464.19 (£240.5), a fall of $22.25 (£11.5), or 4.57%.

Nevertheless, 29 brokers are still advising investors to continue to buy Google shares, while only four rate it as a “hold”. (source: Timesonline)

£50 Million windfall for two co-founders

2008-02-22T01:10:00.000-08:00

The two co-founders of Pret A Manger in 1986, Julian Metcalfe & Sinclair Beecham, are expected to pocket at least £50 million from the sale of the business to Bridgepoint Capital in a £350 million deal.

However, the two co-founders are thought to be leaving a similar amount in the company in a complex earnout deal, which, depending on performance, could boost the headline price closer to the £400 million they had hoped for.

McDonald's, is understood to be selling its entire 33% holding it bought a few years ago in Pret A Manger to Bridgepoint. The management team, led by Larry Billet, the chairman, and Clive Schlee, the chief executive, will stay with the business and with the co-founders will have a 25% stake.

Bridgepoint, which beat off competition from the rival private equity firms Advent International and Morgan Stanley Private Equity, has secured debt funding from Rabobank worth an estimated £175 million.

The acquisition of Pret by Bridgepoint, which is being advised by Goldman Sachs, bolsters a portfolio of consumer-facing brands that includes Pets at Home, Fat Face, Molton Brown and Virgin Active.

Mr Metcalfe and Mr Beecham, who were college friends, opened the first Pret outlet in 1986 to sell freshly prepared sandwiches using only natural, preservative-free ingredients. The chain has about 180 shops in Britain, 14 in New York , 10 in Hong Kong and a single outlet in Singapore. (source: Timesonline) - PRET to be sold

Microsoft not intending to raise its stake in Yahoo!

2008-02-20T01:41:00.000-08:00

Microsoft is not intending to raise its offer on the original $42 billion (£21.5 billion) cash-and-shares offer for Yahoo!, the software group’s chairman said yesterday. Bill Gates said that Microsoft’s bid was “full and fair” and insisted that there had been no confidential negotiations between the two sides to try to agree a deal after Yahoo! rejected his group’s original bid this month.

It is not sure what the next step would be for Mr Bill Gates as he declined to spell out what he planned to do next. The expectation is that Microsoft aims to test the opinion of Yahoo! shareholders by nominating alternative directors to challenge the Yahoo! board. The deadline for filing is March 13.

Mr Bill Gates said: “We can afford to make big investments in the engineering and marketing that needs to get done. We will do that with or without Yahoo! But we also see that we’d get there faster if the great engineering work that Yahoo! has done and the great engineers in Microsoft were part of the common effort.”

Separately, there were signs yesterday that Alibaba, Yahoo!’s Chinese partner, was trying to exert some influence in the deal. Yahoo! owns 39 per cent of Alibaba, which runs an internet marketplace. The business is controlled by Jack Ma, its founder, who wants to retain a similar level of autonomy under any new ownership.

Last night it was reported that Yahoo! plans to offer its employees enhanced severance benefits in the event of their jobs being cut after a change in control of the company. (source: Timesonline)

Alliance & Leicester's suffered a $360.4 million (£185 million) writedown on its exposure to risky assets. Britain’s seventh-biggest bank, reported a 2007 pretax profit of £399 million down from £569 million in 2006. Underlying core operating profit rose 3% from 2006 to £602 million.

Alliance & Leicester warned three weeks ago that its writedown on holdings of structured investment vehicles (SIVs) and other products tarnished by the US subprime housing crisis had more than tripled from a previous estimate to £185 million. Profit was also knocked by a £10 million loss on ineffective hedges and £8 million of redundancy costs.

Alliance & Leicester calmed worries about funding problems in November by saying it had agreed medium-term financing facilities, and said it had funding to see it through to the first quarter of 2009. (source: The Independent)

8 Reason why it is better to buy a business for your road to financial independence (by Richard Parker):

When done right, buying a business lets you achieve returns of 25% to 33% on your cash investment. Try getting that consistently in the stock market.

Unlike a job, there is no limit to how much money you can make.

There are enormous tax benefits when you own a company that you cannot take advantage of as an employee.

As you grow your business, the value of your investment will build exponentially.

Since you will be inheriting an infrastructure, you can take as much vacation as you would like. Try doing that with a job!

For every dollar of growth that you generate, you will get back three times or more when the time comes to sell the company.

You can acquire additional assets that complement your business - such as commercial real estate - and cover all the costs from the cash flow of the business.

From a tax perspective, the bulk of the business’ appreciated value can be taxed at favourable capital gains rates when you ultimately sell the business.

British Billionaire buys 7% stake in Ladbrokes

2008-02-19T00:51:00.001-08:00

The Bahamas-based British Billionaire ranked 16th on the Sunday Times Richlist, Joe Lewis, has bought a near 7% stake in Ladbrokes, the UK's biggest bookmaker. Mr Lewis believed that Ladbrokes shares are undervalued and he is thought to be keen to acquire more blocks if and when they become available. His holding is worth £300 million.

Speculation has swirled in recent weeks as to the identity of the buyer after Citigroup disclosed in a series of statements that it was holding shares as “contracts for difference” on behalf of one of its clients.

Mr Lewis recently paid $860 million (£440 million) for a 7% stake in Bear Stearns, the American bank, which has been hit hard by the US sub-prime mortgage meltdown. He has since increased his holding to 8%. He also owns a stake in Tottenham Hotspur Football Club and has in the past tried to acquire Victor Chandler, the betting group.

Any bid could also involve a tie-up with Apax Partners, the British private equity group, which is known to have approached Ladbrokes in 2006 when it was demerged from Hilton Group. Mr Lewis, who is involved with Betdaq, the betting exchange, has recently been linked to stake-building at Rank Group, the embattled casino and bingo club operator. Analysts believe that, in the event of a bid for Ladbrokes, he may consider turning his sights on Rank with a view to merging the two companies and creating a gambling conglomerate to rival Gala Coral. (source: Timesonline)

Anyone who splashed out £450 on a state of the art HD-DVD high definition player could soon be counting the cost. Comprehensively outsold by the Sony-developed rival Blu-ray, the Toshiba player may soon be irrelevant, amid growing expectation that its Japanese manufacturer will abandon the technology within days.

An estimated 50,000 HD-DVD players have been sold in Britain — although Toshiba will say that sales across Europe total 200,000 and almost 275 000 films. Blu-ray, though, has built up an unassailable lead, with a little over 800,000 films sold in Britain since both technologies were launched.

Toshiba insisted yesterday that “no decision had been taken,” although private briefings in Japan indicated that the cave-in would come later this week. In Tokyo, Toshiba shares increased by 6%, in the hope that it can save $450 million (£220 million) by walking away from its white elephant.

Five Hollywood studios back Blu-ray, after Warner Brothers said it would switch to the format at the beginning of the year, leaving HD-DVD owners only with films from Universal, the King Kong studio, and Paramount.

Blu-ray won because Sony built the player into the PlayStation3 games console. Although Toshiba had support from Sony’s games rival Microsoft, HD-DVD was not built into the Xbox 360, meaning that it was not a default purchase. In America, Blu-ray films are outselling HD-DVD releases by at least four to one; most weeks two thirds of players sold were Blu-ray devices. Blu-ray has built up a similar lead in Japan. (source: Timesonline)

Virgin's Bid to be blocked

2008-02-15T03:43:00.000-08:00

Northern Rock’s leading shareholders are preparing to vote down a rescue proposal from Sir Richard Branson's Virgin Group despite the looming threat that the beleaguered mortgage bank will be nationalised if a deal fails. Virgin’s offer will be opposed by RAB Capital and SRM Global, the two hedge funds that are the Rock’s largest investors, who between them hold a 19.68% stake in the bank.

Legal & General Investment Management is the third-largest owner of Rock shares, with a stake of 4.79%. Together, the three investors are within a whisker of owning the 25% required to block a Virgin-led rescue. The only way the Government could bypass a Northern Rock shareholder vote would be to force the bank into administration, but that would be a legal minefield.

A final government decision on its future could come as early as this weekend. SRM has taken legal advice that has concluded that if the Government nationalises Northern Rock, it must pay shareholders the book value of the bank, estimated to be 400p a share. This runs counter to the Government’s legal advice, which states that shareholders should receive the market value of the bank, less the value of support so far offered through emergency loans from the Bank of England.

The Bank has lent about £26 billion so far and has taken an estimated £91 billion in liabilities on to its balance sheet. (source: Timesonline)

British Airways will pay $140 million (£71 million) in compensation to passengers affected by the carrier’s fixing of ticket prices after settling a class-action lawsuit in the United States. The settlement brings British Airways’ total pay-outs for conspiring to fix fuel surcharges to £338 million.

The lawsuit was brought by a US law firm on behalf of passengers who lost out as a result of British Airways and Virgin Atlantic conspiring to set the level of fuel surcharges, a supplemental fee added to air fares to cover rising oil prices.

Virgin’s action saved it from censure but British Airways was fined £121.5 million by the Office of Fair Trading for breaching competition law. The US Department of Justice fined the airline a further $300 million (£150 million) for passenger and cargo price fixing.

Virgin is thought to be paying $60 million (£30 million), but British Airways will have to pay triple damages because it did not expose the conspiracy. The size of the British Airways settlement may force it to put aside more money to pay further penalties. The airline is under investigation by European authorities for fixing cargo rates and may face a class-action suit from haulage firms.

Fifteen airlines have admitted they are part of the EU’s investigation into cargo price fixing, which also relates to the setting of fuel surcharge rates. (source: Timesonline)

Warren Buffett, the world’s second richest man, has built up an 8.6% stake in Kraft Foods, worth $4.32 billion (£2.2 billion), making him its largest individual shareholder. These shares were bought last year. It was revealed that Mr Buffett has spent $76 million (£39.37 million) on shares in UK drugs firm GlaxoSmithKline.

His investment in Kraft is being seen as a vote of confidence in the firm, which only last month posted a 6% decline in quarterly profits after it was hit by higher raw material costs. Kraft's best-known products include its eponymous cheese, Maxwell House coffee and Oreo cookies.

Mr Buffett bought the shares through his Berkshire Hathaway investment vehicle. (source: BBC News)

Yahoo! rejects Microsoft offer

2008-02-12T02:22:00.000-08:00

Microsoft is not planning to give and vowed to pursue Yahoo! after the internet search engine formally rejected a $41 billion (£21 billion) approach. Microsoft said that it reserved the right to “pursue all necessary steps” to ensure that Yahoo! shareholders have a chance to gain from Microsoft’s interest, hinting that it may seek to oust the Yahoo! board by launching a proxy fight using its Yahoo! shares.

Microsoft’s insistence that it is to chase Yahoo! came as it emerged that Google has become reluctant to act as a white knight for Yahoo!. Google, the world’s biggest internet company, has gone cold on the idea of helping its online search rival to reject Microsoft’s advances.

It is understood that Google has studied regulatory implications of a cooperation deal with Yahoo! and is reluctant to attract unnecessary attention from anticartel groups, particularly as it has been so vocal against Microsoft’s dominance elsewhere in the software market.

Yesterday, Wall Street traders indicated they expected Yahoo! to fall to a Microsoft offer as shares in the search engine closed at $29.87 (£15.47) in New York, up 67 cents and just shy of the $31 (£16.06) proposed by Microsoft.

Yahoo! has suffered eight consecutive quarters of falling profits and a declining share of the internet advertising market, estimated to be worth about $40 billion (£20.72 billion) a year and expected to double within two years.

Yahoo! said it was rejecting the offer, which had valued its shares at a 62% premium to their closing price the day before the offer was made public, because it “substantially undervalues Yahoo! including our global brand, large worldwide audience, significant recent investments in advertising platforms and future growth prospects, free cash flow and earnings potential as well as our substantial unconsolidated investments”. (source: Timesonline)

Yahoo! and AOL continue merger talks

2008-02-11T01:36:00.000-08:00

Yahoo! and AOL are restarting merger talks as a means of defending itself against the $45 billion (£23 billion) hostile bid approach from Microsoft. It is understood that Yahoo! and its team of advisers from Goldman Sachs and Lehman Brothers, the US investment banks, have spent the past week evaluating possible tie-ups with media and technology firms that would save it from being swallowed by Microsoft.

Yahoo! and AOL previously failed to join forces because of differences over price. It is however hoped that the urgency created by an unwelcome approach from Microsoft and an impending economic downturn will spur the two into new talks. Google, which offered support to Yahoo! when the Microsoft approach was made public, also has a 5% stake in AOL.

Jerry Yang, co-founder of Yahoo!, will today tell Wall Street that his board has rejected the software giant’s cash-and-shares proposal because it significantly undervalues the company. It is believed that the Yahoo! board will not even consider starting talks with Microsoft unless the suitor group offers at least $12 billion (£6 billion) more, representing a share price value of more than $40 (£20).

Currently, Microsoft has proposed paying $31 (£15) in cash and shares, valuing Yahoo! at just under $45 billion (£23 billion). Microsoft had proposed to pay Yahoo! shareholders up to half in cash and the rest with Microsoft shares.

Yahoo! has suffered eight consecutive quarters of profit decline. Critically, it has also lost part of its share of the $40 billion (£20 billion) online advertising market to Google, its dominant rival. Microsoft is desperate to take over Yahoo! because of the threat that Google’s dominance of the online search advertising market poses to the computer company’s future. Last year, after long discussions about a merger between the two, Yahoo! declared that it was not for sale. However, it did agree to draw up proposals about how the two could co-operate to fight Google more effectively. (source: Timesonline)

Under the new Open Skies regime that throws transatlantic routes open to full competition for the first time from the end of March, a raft of airlines have unveiled plans for new Heathrow services. According to aviation industry sources, all but US Airways have signed deals with companies to refuel their planes at the world's busiest airport. This is because of BBAs inability to secure fuel supplies for a new service it plans to launch next month from the world’s busiest airport and is threatening to launch legal action against BAA.

A US Airways spokesman said: "We are working every possible angle to acquire fuel at Heathrow and have been ever since we announced our start-up last November. This situation continues despite the fact that the BAA and [airlines trade body] IATA have brokered a deal among all of the airlines to allocate fuel among themselves to ensure everyone, including the new entrants to the market, have adequate fuel."

BAA has appealed to several other airlines to make some of their supplies available to US Airways. None has agreed to do so. A source at one rival airline said: "They spoke to us about it but of course we said no. They are competitors. No one has been willing to take them on."

A BAA spokeswoman said: "We are confident there will be sufficient fuel, and we have contingency plans in place." (source: The Independent)

EasyJet on track with profits

2008-02-07T02:37:00.000-08:00

EasyJet, the low-cost airline, continues to expand faster than it can fill seats but the carrier said yesterday that its profit forecast was unaltered. Easyjet reported that it carried 9.1 million passengers in the three months to the end of December, which is up 12.4% on the same period a year before.

EasyJet, however, is in the middle of a rapid expansion after spending $4 billion (£2 billion) on 104 new Airbus aircraft and available seat kilometres. The industry measure of total capacity grew faster than passenger numbers at 17.7% and this resulted in emptier aircraft and the carrier’s load factor fell a percentage point to 80.8%.

The load factor in January, which easyJet also released today, was even worse, down 2.9 percentage points on the same period last year. However, easyJet has rejected the gloomy predictions for the sector made by its rival Ryanair this week. (source: Timesonline)

Don't give up

2008-02-06T02:01:00.000-08:00

Don't dwell so much on a problem that you've exhausted yourself before you can even entertain a solution. It just doesn't make sense. It takes brainpower and energy to think positively and creatively -- and to see creatively and positively. Going negative is the easy way, the lazy way. Use your brainpower to focus on positives and solutions and your own mindset will create your own luck.

Shakespeare put it this way, in a famous quote from Julius Caesar: "The fault is not in our stars, dear Brutus, but in ourselves."

That's a clear message. We are responsible for ourselves. We are responsible for our own luck. What an empowering thought! If you see responsibility as a bum deal, then you are not seeing it for what it really is -- a great opportunity.

Let's say you're facing some big challenge today. I can tell you right now you've got a lot of company. What will separate you from the complaining crowd will be how you choose to look at your situation. If you believe you are in control of it -- and you are -- you will know exactly who to look for when you need help: yourself. You could be your greatest discovery yet for success, luck, power, and happiness.

When I encountered enormous financial challenges back in the 1990s, I was mature enough to assume responsibility and know that the problem was mine. I knew it wouldn't do any good to blame other people. That would be a waste of time, and that's one kind of loss I don't like. Time is something that cannot be replaced. If you find yourself slipping into the blaming others mode, get out of it quickly.

Give luck the chance it needs to play itself out in your life. No one can do it for you. As soon as you discover that luck is yours to create, you'll be thinking and seeing things in a whole new way. So work hard, have fun - and good luck!

Today’s article is adapted from Donald J. Trump’s newest book, Trump: Never Give Up: How I Turned My Challenges into Success, published by John Wiley & Sons.

Olivant withdrew bid

2008-02-05T03:40:00.000-08:00

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)

Microsoft serious about takeover & Businessman of the Month

2008-02-04T03:54:00.000-08:00

It is understood that Microsoft is threatening to launch a boardroom coup at Yahoo! within six weeks if the internet search engine fails to accept its $45 billion (£23 billion) hostile takeover proposal. The plan to oust Yahoo! executives came, as it emerged that the search engine was considering the feasibility of a tie-up with Google, its bigger rival, to fight off the approach from Microsoft.

While any tie-up between the two would trigger a cartel investigation — a combination of Yahoo! and Google would have more than 80% of the UK’s internet searches alone — Yahoo! is thought to be considering options such as turning to Google as its search provider.

David Drummond, Google’s chief legal officer, said in a blog that a combination of Microsoft and Yahoo! could undermine the open competition that has fuelled more than a decade of innovation on the web. He said: “Could a combination of the two take advantage of a PC software monopoly to unfairly limit the ability of consumers to freely access competitors’ e-mail, IM and web-based services?”

Although it is understood that Microsoft would much prefer a takeover to be amicable and not resort to ousting Yahoo! directors, the software company has become increasingly frustrated that the lack of a tie-up between the two groups has helped Google, the world’s biggest internet company, to grow even stronger. So anxious are Microsoft executives about Google’s dominance that they are prepared to remove the Yahoo! board.

Some analysts say that although a bid valuing Yahoo! at a 62% premium is hard to reject, Yahoo! may consider a tie-up with another media group, such as News Corporation, parent company of The Times and Times Online, or Disney, or a telecoms group, such as AT&T. (source: Bloomberg)

Rising airport charges at Stanstead and tougher operating conditions was blamed by Ryanair, Europe's largest airline, today blamed for the 27% slump in third-quarter profits.

The company also gave warning that the worsening economic environment in Europe could hammer next year's results, predicting that profits might fall 50% to €235 million (£176 million) in a worst-case scenario.

Ryanair said that the high oil price, combined with longer routes and an increased number of flights, would lead to significantly higher costs. Its best-case scenario for 2008-09 was a 6% increase in profits to about €500 million (£375.94 million), but the airline also said that there could be a 50% fall in profits if oil stayed high and consumer spending declined.

In the three months to the end of December, Ryanair reported a fall in income from €48 million (£36 million) to €35 million (£26 million) despite a 21% increase in passenger numbers and a 16% rise in revenue.

Ryanair carried 12.4 million passengers during the third quarter and ancillary revenues — money raised from extra charges — rose 30% to €111 million (£83 million). Overall revenue was €569 million (£427.81 million). The company had a one-off gain of €12.1 million (£9.09 million) from the disposal of five aircraft. The low-cost carrier now expects to see net income of €470 million (£353.38 million) for the full year — roughly in line with analyst forecasts.

Despite the worsening profit figures, Ryanair announced a €200 million (£150.37 million) share buyback, equivalent to 3% of the company's stock. This is in addition to the €300 million (£225.56 million) buyback announced last year. (source: Timesonline)

Businessman for February – Johann Rupert

Johann Peter Rupert was born 1 June 1950 and is the eldest son of the late business tycoon Anton Rupert, the founder of the Rembrandt Group. He is the chairman of the Swiss-based luxury-goods company Richemont, the owners of brands such as Cartier & Mont Blanc, as well as the chairman of the South Africa-based companies VenFin and Remgro.

He attended the University of Stellenbosch, studying economics and company law but he dropped out of university to pursue a career in business. Rupert served his business apprenticeship in New York, where he worked for Chase Manhattan for two years and for Lazard Freres for three years. He then returned to South Africa in 1979 and founded Rand Merchant Bank of which he was CEO. He started the Small Business Development Corporation in same year (+/- 500,000 jobs created since inception). In 1984 Rupert merged Rand Merchant Bank and Rand Consolidated Investments, and left to join his father's company, the Rembrandt Group.

Healthy profits for British Airways

2008-02-01T00:32:00.000-08:00

Despite rising fuel costs and consumer slowdown, British Airways has still reported healthy profits for the last nine months of 2007, with pre-tax profits at £788 million, up 34.9% from the same period of 2006.

Fuel costs in the first six months of the period fell by £36 million, however fuel costs rose for the last three months to £72 million. The figures come less than two months before the opening of Heathrow's new Terminal 5, which BA hopes will improve punctuality and baggage performance.

British Airways reported strong pre-tax profits for the last three months of 2007 at £195 million, which is 72.6% up from £113 million in the same period of 2006.

British Airways Chief Executive, Mr Willie Walsh, said "This is another good set of results despite soaring fuel costs and difficulties in the market. The opening of Terminal 5 is now less than two months away and the public trials and previews for our Executive Club members have been very successful."

British Airways added that the weakening US dollar had contributed to a £101 million fall in its costs over the nine months. (source: BBC News)

Google reported disappointing profits in the last quarter with profits up at only 17% to $1.21 billion (£608 million) for the three months to the end of December. Some analysts had been hoping for stronger profit growth and its shares fell sharply in after hours trading, which brings the total to more than 18% so far this year. This is prove that Google is not immune to an economic slowdown in the US. Google's sales for the quarter were $3.39 billion (£1.7 billion), up 52% but not as much as were hoping for. (source: BBC News)

Record profits for Shell

2008-01-31T02:10:00.000-08:00

Royal Dutch Shell reported full-year record profits of $27.6 billion (£14 billion). This is a record for a European company, despite the lower oil and gas production and weaker refining margins.

For the year oil, and gas production fell to 3.315 million barrels a day of oil equivalent. This is down 4.5% compared with 2006. Fourth-quarter earnings on a current cost of supply basis were $6.7 billion (£3.35 billion) compared with $6 billion (£3 billion) a year ago, with fourth quarter production figures falling by 5.7% to 3.436 million boe/d in the same quarter last year.

Exploration and production segment earnings rose to $4.9 billion (£2.5 billion) from $3.5 billion (£1.75 billion) a year ago, reflecting the impact of higher oil and gas prices on revenues. Excluding a net gain to non-operating items of $963 million (£481.5 million), fourth-quarter current cost of supply net income was $5.74 billion (£2.87 billion).

Shell shares edged 0.5% higher to £17.52. (source: Financial Times)

Amazon, suffered a sharp slide in its share price yesterday despite surging sales. Profits during the fourth quarter of the year more than doubled, while revenues jumped 42% over the three month period.

In after-hours trading on Wall Street, shares in the group fell 3% even though Jeff Bezos, the chief executive, was more upbeat about the current quarter’s performance. Mr Bezos said that he “expected to produce sales of between $3.95 billion (£2 million) and $4.15 billion (£2.07 billion) for the current quarter, contributing to between $18.75 billion (£9.35 billion) and $19.75 billion (£9.87 billion) of revenues for 2008 as a whole.”

Revenues derived from Amazon’s largest business segment, which includes books, music and films, grew 33% to $3.33 billion (£1.66 billion) worldwide in the quarter. Sales of electronic goods and general merchandise such as wine glasses rose 58% to $2.21 billion (£1.1 billion).

Fourth-quarter gross margin came in at 20.6%, having fallen from 21.3% a year earlier and 23.4% in the third quarter. Net profits rose 112% to $207 million (£103.5 million) from $98 million (£49 million), a year ago. Sales rose 42%to $5.67 billion (£2.83 billion) in the quarter. (source: Timesonline)

Thomas Cook on track for record profits

2008-01-30T00:42:00.000-08:00

It seems like consumers are showing no sign of cutting back on major trips around the globe as holidays giant Thomas Cook today said it was in good shape for the year ahead. The company, which merged with Airtours rival MyTravel last year, said demand for both winter and summer holidays exceeded supply.

The company said that it benefited from reduced capacity on loss-making routes, particularly to long-haul destinations. "By managing the number of holidays to be sold, we believe we are in a position to benefit from higher average selling prices and are less exposed to any future change in demand." a spokesperson at Thomas Cook said.

The update on trading conditions came as Thomas Cook posted annual profits from existing operations of 375.3 million euros (£279.1 million), an increase of 26% on a year earlier.

The project by merging with MyTravel involved the closure of 144 shops in the UK, leaving an estate of 812. The company's UK headquarters have also been established in Peterborough after a number of offices were closed in a rationalisation programme.

Thomas Cook Airways is now the company's only UK airline, operating with a single flight programme with effect from this spring. The company said it was on track to achieve savings of at least 200 million euros (£148.8 million) from the merger, which is an increase of 60 million euros (£44.6 million) on its original forecast and up to a year ahead of schedule. (source: The Independent)

BSkyB ordered to sell ITV stake

2008-01-29T02:15:00.000-08:00

BSkyB has been ordered by the government on Tuesday to reduce its 17.9% stake in broadcaster ITV to below 7.5%. The reason is because the purchase was anti-competitive, potentially costing the company around £250 million.

Secretary of State for Business and Enterprise John Hutton also ordered BSkyB “not to sell the shares to an ‘associated person’, nor to seek representation on the board of ITV and not to reacquire shares in the broadcaster”. He furthermore said he would not disclose the time period given to BSkyB for the sale, following a request from the company.

This ruling from Mr John Hutton could cost BSkyB around £250 million if it sold at Monday's closing share price, since the value of the shares has dropped since the purchase. ITV welcomed the ruling and said it was in the best interests of the overwhelming majority of its shareholders, while BSkyB said it would give careful consideration to the announcement and confirm any further steps in due course.

Shares in ITV initially opened up 2% before settling at 0.8% up at 72.6 pence. Shares in BSkyB were up 0.6% at 534 pence. (source: Reuters)

Restaurant giant McDonald's has seen its latest quarterly profits increase just 3%, as sluggish US sales trailed behind those in its overseas markets. In the three months to the end of December, the company's net profit rose to $1.27 billion (£640 million) from $1.24 billion (£620 million) for the same period in 2006.

McDonald's said its US sales were being hit by "softer consumer spending". McDonald's group-wide quarterly revenues rose 6% to $5.8 billion (£2.9 billion), from $5.4 billion (£2.7 billion) a year previously. Same-store global sales were up 6.7%. (source: BBC News)

Starbucks serving coffee at $1

2008-01-28T07:50:00.000-08:00

Starbucks has confirmed reports it has started to sell a $1 (51 pence) cup of coffee in certain stores in Seattle as a trial. It is not definite that the cheap brew coffee will be added to the rest of its chains in the US or overseas.

However, its business has suffered from slowing consumer spending and competition from low-cost rivals. The news had first been reported in the Wall Street Journal, which also said the Seattle-based company was experimenting with giving free refills of some of its offerings.

"We are conducting a test in the Seattle area. However, this test is not indicative of any new business strategy," said Starbucks spokeswoman. The firm is trying to lift its sagging fortunes, which saw its shares fall by more than 40% last year.

Higher dairy and energy prices have seen the firm push up prices of its lattes and espressos. In addition, analysts warn the specialist coffee firm faces steep competition from fast-food chains, such as McDonald's, which is in the process of introducing its own line of gourmet coffee.

Starbucks sacked its chief executive, Jim Donald, at the beginning of the year and handed the reins back to its chairman and former chief executive, Howard Schultz, to steer a recovery effort. (source: BBC News)

Scottish & Newcastle approached by Heineken

2008-01-25T02:20:00.000-08:00

Heineken is set to assume the mantle of Britain's biggest brewer after teaming up with Carlsberg to launch a recommended bid for Scottish & Newcastle (S&N) worth more than 800p a share (£10 billion).

Although a counterbid from the likes of Anheuser-Busch or SABMIller remains a possibility, analysts believe that the price being paid by the bidding consortium, which is 80p more than its first offer in October last year, is unlikely to be topped.

The shares were trading at 637p before the first approach in the autumn. In the event of a rival bid, Carlsberg and Heineken would receive a break fee of £780 million, or 1 per cent of S&N's equity value.

Under the proposed deal, Carlsberg, which is being advised by Lehman Brothers, is expected to fund about 56% of the purchase, with its Dutch partner paying 44%. Heineken, which is being advised by Credit Suisse, has secured debt finance from a consortium led by Credit Suisse, Bank of America, Barclays, BNP Paribas, Citibank, Fortis, HSBC, ING and JPMorgan Chase. (source: Timesonline)

A day before Fred Gehring, the Tommy Hilfiger chief executive, was due to begin an investor roadshow, Apax, the London-based private equity group, blamed market turmoil yesterday as it scrapped the $4billion (£2billion) float of Tommy Hilfiger, the fashion label.

Apax planned to sell a 25% stake through the listing on Euronext in Amsterdam, where Tommy Hilfiger has its headquarters. Apax would have retained a 50% share with senior management, staff and other private investors holding the balance.

The decision sparked fresh concerns that the consumer slowdown caused by the credit crunch has spread to the upmarket fashion and luxury goods market. Coach, the largest US maker of luxury handbags, reported its weakest profits growth for eight years on Wednesday, while Richemont, home to the Cartier and Montblanc brands, said demand was slowing. Burberry, the UK label, this month said it may miss profit targets after poor sales in Spain.

Apax bought the label three years ago for $1.6 billion (£800 million) but the 56-year-old founder retained a minority stake and the role of principal designer. At the time the label had seen its US profits halve in five years. (source: Timesonline)

Meg Whitman, the chief executive of auction website eBay has resigned after a decade at the helm of the firm. Ms Whitman will be replaced by John Donahow, who is currently in charge of the firm’s main auction business.

The US firm posted a market-beating 53% rise in profits for the three months to December. Ms Whitman has been lauded for turning eBay into a powerhouse in e-commerce. She will remain a director at the firm.

When Ms Whitman joined the company in 1998, eBay said it had $4 million (£2 million) in revenue and 30 employees. It has since grown into a multi-billion dollar firm with 15,000 employees and has expanded into a variety of businesses, including buying online payments service PayPal and internet telephone service provider Skype.

But growth in its core listings business has stagnated and analysts are keenly anticipating a new strategy to deal with increasing competition. eBay's guidance on earnings for the coming year fell short of expectations and it is expected that its shares will fall when trading opens in New York on Thursday. (source: BBC News)

Apple forecasts below estimates

2008-01-23T01:06:00.000-08:00

Apple expects to earn 94 cents a share on $6.8 billion (£3.4 billion) in sales for its second quarter. This forecast fell below analysts' consensus estimates for earnings of $1.09 (55p) a share on revenue of $6.99 billion (£3.5 billion). The outlook helped send Apple's shares down more than $17 ((£8.5) a share, or 11%, to $138.49 (£69.3) in after-hours trading.

For its fiscal first-quarter, Apple earned $1.58 billion (£790 million), or $1.76 (88p) a share, on revenue of $9.6 billion (£3.45 billion). During the same period a year ago, Apple earned $1 billion (£500 million), or $1.14 (57p) a share, on $7.12 billion (£3.56 billion) in sales.

The company attributed the quarter's performance to a strong holiday season, as Apple said that it sold 22 million iPods and 2.3 million Macintosh PCs during the quarter. Also, about 2.3 million iPhones were sold during the quarter. But even though Apple could point to items such as a 17% increase in iPod revenue and a 47% rise in its Mac sales from a year ago, some analysts felt the company should have done even better in light of recent revamps of the iMac and iPod product lines. (source: Market Watch)

It seems like the Financial Services Authority (FSA) is to examine the rules governing websites that compare insurance products. The issue is whether the act of ranking insurance products online by price constitutes giving financial advice. Some comparison websites are allowed by the financial watchdog to arrange insurance, but not to give advice. Traditional insurance brokers must meet strict regulations to give advice.

Rules covering so-called "electronic introduction" were designed before the development of comparison websites, and therefore did not provide appropriate protection for consumers. According to research commissioned by Biba, many price comparison websites use assumptions when generating quotes, something a third of consumers did not realise.

After interviewing a small sample of consumers, it said more than half of those questioned who had used price comparison websites felt the differences between insurance policies were not adequately explained. Only 6% felt sufficient policy details were given.

A spokesman for the FSA said it had looked at the question of comparison websites in the past. Richard Mason, director of comparison site Moneysupermarket.com, which is already fully authorised by the FSA, said he would welcome new guidance from the regulator, but accused Biba of exaggerating the scale of the problem.

Following its investigation, the FSA could take a range of actions including issuing revised guidance, enhanced supervision, or making changes to regulation. (source: BBC News)

Best Christmas Performance by Morrisons

2008-01-22T00:55:00.000-08:00

Morrison’s, the UK’s fourth largest Supermarket group, unveiled the best Christmas performance in the sector. Morrison’s beat forecasts with a 9.5% rise in like-for-like sales excluding fuel in the six weeks to January 6th. A new advertising campaign launched in September boosted sales at Morrison’s, which has trailed larger rivals Tesco, Asda and Sainsbury since its merger with Safeway in 2004. Chief Executive Marc Bolland said in a statement “we welcomed significantly more customers to our stores, and they were well served with attractive offers and fresh food," He said “Morrison's full-year profits also would be helped by it holding over costs of around 30 million pounds ($58 million) relating to its Optimisation business plan to next year”. "We expect the market to remain competitive and we are cautious on the outlook for consumer spending. However, we believe that our strong value credentials will serve us well in these conditions," Bolland said.

Morrison's was forecast to report like-for-like growth of 6.5% excluding fuel. Predictions ranged widely from 5% to 8%. For the Christmas period, like-for-like sales excluding fuel rose 3.1% at Tesco, 3.7% at Sainsbury and 4.1% at Waitrose. (source: Reuters)

TAM airline, the Brazilian airliners, announced yesterday that it had signed a contract to buy 46 Airbus jets, including 22 extra-wide-body A350s. The European-made A350 is a competitor to the Boeing 787 Dreamliner. The order is worth $6.9 billion (£3.5 billion) at list prices, although most airlines obtain deep discounts from plane makers.

The new fleet is to help TAM to expand its overseas routes. The addition of the A350s to TAM's fleet marks the first time that the plane will be used in South America, and it will allow the carrier "to continue the successful expansion we have already had" with smaller Airbus jets, said TAM chief executive David Barioni Neto.

Airbus said in a statement that the TAM agreement raises the number of orders for A350s to 314 aircraft worldwide. TAM will also add 4 Airbus A330-200 planes and 20 A320s to its fleet under the order, the companies said.The order for the A320s was new, marking a significant increase in the number of TAM orders from Airbus. Using list prices, the order for the A320s alone amounts to about $1.5 billion (£750 million). TAM said the contract does not alter its forecast for its fleet size. The airline has 109 planes, expects to have 123 by the end of this year and 136 by the end of 2013. (source: Business Week)

The Universe & Britian's 100 Most Influential People

2008-01-21T00:42:00.000-08:00

A-list and wealthy people will be able to buy countries in The World - the cluster of islands created by Dubai's ruling al-Maktoum family that form part of what can be described as the most ambitious development in the galaxy. Nakheel, is planning to build, The Universe next to The World.

Inspired by the “wonders of the solar system”, The Universe will feature man-made islands built in the shape of the Sun and the Moon, with a string of planets in between. Nakheel's plans show a ringed island of Saturn and Jupiter, the largest planet, divided into three sections. It said that demand would determine the final size of The Universe, which is due for completion in 15 to 20 years' time. The Universe will house luxury homes, shopping centres and miles of beachfront.

Nakheel said its projects were ecologically sound. “We are building this with a lot of warning so we can manage water and energy supplies rather than just plonking something in the sea and turning on the tap,” Shawn Lenehan, its head of environment, said. (source: Timesonline)

Acquisition talks were denied by Air China which posted its sharpest-ever slide. Its state-owned parent plans to invest in rival China Eastern Airlines Corporation Ltd, the mainland's No.3 airline, in a proposal that could bring the Shanghai-based airline a cash injection of $1.9 billion (£1 billion). But China Eastern group also said on Monday that it could not respond to the proposed partnership because the proposal was incomplete and lacked legal validity. (source: Reuters)

1. Winfried Franz Wilhelm Bischoff was born in Germany in 1941. His family moved to South Africa in 1955, and he has joint British and German citizenship. After joining Schroders, he worked in Hong Kong until 1983 when he returned to England, becoming chief executive in 1986 and chairman in 1995. Since the acquisition of Schroders, Sir Win has thrived within Citibank, last year overseeing its acquisition of Egg, the consumer credit brand. He became interim chief executive of Citigroup in November last year when Charles Prince stepped down. He is nonexecutive director of the education group McGraw Hill, Akbank TAS Istanbul, one of Turkey’s biggest banks, and of the healthcare company Eli Lilly.

2 - Tony Hayward has been chief executive of BP, Britain’s largest company, since May last year. He joined BP in 1982 straight after writing a PhD in geology. He worked in France and China, before becoming explorations manager in Colombia. In 1995 Mr Hayward was promoted first to president of the operations in Venezuela, and then to director of BP exploration, which brought him back to the UK. Appointed chief operating officer for exploration and production in 2002, he later became the executive assistant – or bag carrier – for Lord Browne, his predecessor in the chief executive slot. He distinguished himself in 2006 with a candid and public reflection on an overly “top-down” style of leadership at the company, expressing concern about the company’s commitment to engineering and maintenance. Accidents in the Gulf of Mexico, and Alaska, have punctured the company’s aura. Mr Hayward’s task is to restore BP to preeminence.

3 - Damon Buffini is chairman of Permira. It may not be the biggest buyout powerhouse, but it is the one that has consistently set, and defended the private equity agenda. Mr Buffini, brought up on a council estate by a single mother, has been ridiculed by unions as an asset stripper and parasite. As the controversy over private equity reached fever pitch, representatives of the GMB union dressed as pantomime animals and paraded outside the South London church attended by the 45-year-old and his family. It is, according to the GMB, easier for a camel to pass through the eye of a needle than for Damon Buffini to mix business with belief. Others may point out that the New Testament parable teaches about the servants who were given talents by their master. It was the servant who invested wisely, and most profitably, who was rewarded with the greatest favour, and approval. Mr Buffini, a Cambridge law graduate with an MBA from Harvard, is an avid supporter of Arsenal Football Club.

4 - Sir John Bond made his way to his first Hong Kong posting with HSBC, the bank whose roots lie in East Asia, by working as a deck hand on a cargo ship. He spent 45 years working for HSBC, rising to be its chairman from 1998 to 2006. On leaving HSBC, he did not retire. He took on a similar role at Vodafone, a company whose market value is equal, and depending on stock market vagaries, sometimes larger than the bank. Sir John took the nonexecutive role at Vodafone just in time to settle investors concerned that the company had lost its way – strategically, operationally and in terms of its executive leadership. Steely calm, one of Sir John’s most attractive characteristics, returned to Vodafone. The shares, which were in the doldrums for much of the early part of this decade, rose 30 per cent in 2007. He was knighted for services to banking in 1999. Sir John, who is married with three children, enjoys golf, skiing and reading biographies.

5 - Cynthia Carroll became both the first female and first non South African head of Anglo American on her appointment as chief executive of the mining conglomerate ten months ago. The 51-year-old American is also a non-executive director of BP. When Ms Carroll was with Alcan, the aluminium giant, her expertise won her seats on the boards of the American Aluminium Association and the International Aluminium Institute. Before joining Alcan, in 1989, she spent eight years working as a geologist in oil exploration for Amoco, now part of BP, and has also been a nonexecutive director of Sara Lee. She holds a master’s degree in geology from the University of Kansas and an MBA from Harvard.

6 - Lakshmi Mittal is one of Britain’s richest men. The Sunday Times Rich List puts the family wealth of the president and chief executive of Arcelor Mittal, the world’s largest steelmaker, in excess of £19 billion. He is a prime example of how the industrial and commercial revolutions of China and, in his case, India are being felt in the established bastions of capitalism. He shows the power of development and trade, as opposed to aid. He has channelled vast sums into charities, notably tsunami relief – and the Labour Party. He has a stake in the West London football club Queens Park Rangers, joining Bernie Ecclestone and Flavio Briatore, the Italian businessman, as joint owner. In 2004 the 57-year-old set a world record for a private home when he paid £70 million for Mr Ecclestone’s house in Kensington Palace Gardens, West London. In the same year he spent £30 million on his daughter’s wedding, including hiring the Palace of Versailles.

7 - Mervyn King is Governor of the Bank of England, chairman of the Monetary Policy Committee and a self-confessed “inflation nutter”. He is an avid fan of Aston Villa and was senior vice-president of the Midlands football club from 1995-99. The son of a railway clerk, who studied at King’s College, Cambridge and Harvard, he will turn 60 in March. He is also a Fellow of the British Academy, is on the Advisory Council of the London Symphony Orchestra and is patron of Worcestershire County Cricket Club. Mr King’s reputation bears blemishes from the Northern Rock debacle, but history may offer a different view.

8 - Sir Terry Leahy is the chief executive of Tesco, the supermarket group. Sir Terry is one of the country’s most influential shopkeepers – 10p in every pound spent in a British shop is handed to Tesco. Sir Terry has also set and consistently raised the standards of mass-market retailing. Tesco is turning its attention to America, where Sir Terry is rolling out Fresh and Easy convenience stores. International sales already comprise a third of Tesco’s £50 billion revenue – Sir Terry’s target is 50 per cent by as little as five years’ time. The 51-year-old Liverpudlian joined Tesco in 1979 as a marketing executive after leaving the University of Manchester Institute of Science and Technology. The ardent Everton fan said moving to the South was the biggest decision of his life: “If I hadn’t, I might be running the Coop.”

9 - Stephen Green, the chairman of HSBC, has been under attack this year by Knight Vinke, the activist shareholders led by Eric Knight. But the carefully spoken and cerebral Anglican lay preacher has stuck to his guns. His promotion from chief executive to chairman drew criticism for breaching corporate governance best practice and, strategically, he was accused of turning his back on Asia and emerging markets. He began his career at the Ministry of Overseas Development, before moving to McKinsey, the consultancy, in 1971. He has been at HSBC since 1982. His interests include Russian poetry and opera.

10 - Sir Fred Goodwin. The Royal Bank of Scotland chief executive earned his Fred “the Shred” nickname as opponents in the NatWest merger tussle sought to sow seeds of doubt about his talents. Perhaps those critics ought now to concede that Sir Fred is a creator, not a shredder of value. Beside, the ardent pursuit of efficiency is no crime: Sir Fred can wear his nickname with some pride, and a wryly ironic half smile. If he makes a success of the acquisition of ABN Amro, the Dutch bank whipped from beneath the nose of Barclays by a consortium including RBS, the wry smile will turn into a broad grin. Sir Fred attended a grammar school in Paisley before studying law at Glasgow University, working as an accountant with Touche Ross, Clydesdale Bank and Yorkshire Bank. He was knighted for services to banking in 2004. Gordon Brown has taken advice from him on a number of occasions.

11 - Alistair Darling is renowned for keeping his head while those around him threaten to lose theirs. As Chancellor he has had these skills stretched to the limit as Northern Rock, data loss and capital gains tax controversies crashed in. Mr Darling has been in the Cabinet since 1997. As Transport Secretary, he made Network Rail less disastrous than Railtrack. While at the Department of Work and Pensions, he officiated over the introduction of stakeholder pensions without undue public protest and while Secretary for Trade and Industry he deflected outrage at post office closures with a protracted consultation process and he delayed making a decision on nuclear power. He studied law at Aberdeen University, where he is remembered as “remarkably normal”, and became a barrister in Scotland. He was also a local councillor. He prefers his Edinburgh home to his official residence in Downing Street.

12 - Guy Hands is the founder and chief executive of Terra Firma. While most of his private equity counterparts lurk in the shadows, Mr Hands has been strutting his stuff centre-stage. During the credit crunch investment bankers came into his cross-hairs: he branded them “whimpering dogs” as they refused to finance “mega-buyouts”. Then came a very public spat with EMI artists over profligate spending at the record label owned by Terra Firma. He failed to see the £200,000 spent every year on stocking EMI offices with fresh fruit and flowers as a necessary expense. Mr Hands, 48, founded Terra Firma in 2002, after spending his earlier career at Nomura and Goldman Sachs.

13 - Bob Diamond is president of Barclays and chief executive of Barclays Capital. The American took a gamble when he left a promising career in charge of Credit Suisse First Boston's Asian business for Barclays in 1996. BarCap has grown from employing 5,000 people to a workforce of 14,700 under his stewardship. While it has been a tough year for the Chelsea FC and Boston Red Sox fan, with Barclays failing in its bid for ABN Amro and his company caught by the credit crunch, he remains a most influential force in investment banking. One of nine children, Mr Diamond, 56, studied and later taught at the University of Connecticut.

14 - James Murdoch is chief executive of News Corporation’s European and Asian operations, with responsibilities that include running News Corporation’s London-based newspapers, which, as well as The Times, include The Sun, The Sunday Times and the News of the World. Elsewhere in Europe and Asia, News Corporation owns Sky Italia, the satellite broadcaster, and Star Television, the pan-Asian TV group. Until last month Mr Murdoch was chief executive of BSkyB, the satellite broadcaster part-owned by News Corp, and has stepped up to become the nonexecutive chairman.

15 - J P Garnier, the 60-year-old French chief executive of the drugs giant GlaxoSmithKline, has spent the past seven years at the helm of one of Britain’s biggest companies, with 100,000 staff and a market value of £70 billion. He is widely credited with helping to restore the group’s pipeline of new drugs during a difficult time for the industry. In May, he is set to step down in favour of Andrew Witty, one of his lieutenants. But Dr Garnier is not planning to disappear into the sunset. He is joining the advisory board of Dubai International Capital, the Middle East emirate’s $13 billion sovereign wealth fund, where he will help to identify investment opportunities. Born in Normandy, Dr Garnier was educated at the Université Louis Pasteur in Strasbourg and took an MBA at Stanford University in California where he was a Fulbright Scholar. He worked for US pharmaceutical giant Schering-Plough before joining SmithKline Beecham, where he was appointed chief executive in 2000. He received the Chevalier de la Légion d’Honneur in 1997.

16 - Clara Furse. The Canadian-born chief executive of the London Stock Exchange batted off a takeover attempt by Nasdaq, the US stock market, and steered the LSE into the FTSE 100. The 50-year-old studied at the London School of Economics, and began her career as a commodity broker at Heinold Commodities. She joined Philips and Drew, which became UBS, where she was promoted to managing director in 1995 before becoming head of the UBS Global Futures and Options business worldwide. She was deputy chairman of Liffe and was group chief executive of Credit Lyonnais Rouse. She is a member of the advisory council of the Prince’s Trust.

17 - Lambertus Johannes Hermanus Becht, more commonly known as Bart, became chief executive of Reckitt Benckiser, the world’s largest household products manufacturer, in 1999. The plain-speaking Dutchman, 51, has been with Benckiser in its various incarnations for 20 years, having joined the firm from Procter & Gamble, where he worked from 1982 until 1988. He holds an MBA from the University of Chicago as well as a degree in economics from the University of Groningen and a business degree from Erasmus University in his home country. Reckitt acquired Boots Healthcare International in October 2005. He is one of the best-remunerated chief executives in the UK, earning more than £4 million in 2006.

18 - Sir Stuart Rose, chief executive of Marks & Spencer and one of Britain’s most charismatic retailers, has won plaudits for saving what some call a national institution. While this week’s disappointing Christmas figures have dented that reputation, even critics concede that the outlook for M&S is considerably brighter than when he arrived in 2004. The 58-year-old began his career at Marks & Spencer in 1972 before embarking on a retail career taking in Burton Menswear, Iceland and Arcadia.

19 - Rachel Lomax is deputy Governor of the Bank of England. Ms Lomax has responsibility for monetary policy, including assessment and money market operations. Before becoming the first female to hold the position in 2003 she was Permanent Secretary at the Department for Transport and previously held the same post for the Department of Social Security. In the mid1990s Mrs Lomax worked in Washington for the World Bank and spent her early career at the Treasury. The Cambridge graduate is on the board of the Royal National Theatre, and is tipped as a possible successor to Mervyn King, the Governor of the Bank of England.

20 - Michael Spencer has built Icap, the City brokerage, of which he is chief executive, into a world leader. Mr Spencer has been nonexecutive chairman of Numis since 2003 and became treasurer to the Conservative Party last February, responsible for raising party funds. He is also a keen fundraiser for charity.

21 - Sir Nigel Rudd is proof that British business is a meritocracy and that the old order, if it ever held sway, is a long way from dominating City and commercial life. Neither an Oxbridge man, nor an ex-Grenadier Guardsman, he went to Bemrose Grammar School in Derby and, after becoming one of Britain’s youngest chartered accountants at the age of 20, he bought into a small car dealership called Williams Holdings. At 40 he was leading one of the fastest-growing British companies, engaged in an acquisition programme that catapulted Williams into the FTSE 100 as an engineering and security services conglomerate. He orchestrated a demerger of Williams in 2000 and from then until 2003 he chaired Kidde, the safety products offshoot. He was chairman of Alliance Boots from 2003 until last year, overseeing the £9 billion sale of the company to Kohlberg Kravis Roberts, the private equity giant, and held a similar role at Pilkington, the St Helens-based glassmaker, from 1995 until it was sold to Nippon Sheet Glass in 2006. He is nonexecutive chairman of BAA, the airports operator, which is owned by Ferrovial, of Spain.

22 - Andy Hornby, an Oxford graduate who topped his MBA class at Harvard Business School, became chief executive of HBOS in 2006 aged 39. He began his career at Blue Circle, the cement company, before moving to Asda, where he worked alongside Allan Leighton, chairman of Royal Mail, and Justin King, chief executive of J Sainsbury. He launched George, Asda’s successful clothing brand, before moving to Halifax, which merged with Bank of Scotland. He is a nonexecutive director of Home Retail Group, the retailer that owns Argos and Homebase, and St James’s Place, the financial advisory firm controlled by HBOS.

23 - Sir Martin Sorrell became chief executive of a small engineering company called Wire & Plastic Products in 1986 at the age 40. Just about everything has changed at WPP since, except the identity of the man in control. With a market value of about £7 billion, it is one of the world’s most powerful forces in marketing. His achievement is all the greater because, after a rash of acquisitions in the late 1980s, the company almost foundered in the early 1990s. In 1987, he stunned the marketing services world with a $566 million hostile takeover of J Walter Thompson, and followed that in 1989 with the hostile $864 million purchase of Ogilvy Group.

24 - Michael Sherwood is co-chief executive of Goldman Sachs International, one of the few Wall Street players to emerge from the credit crunch unbloodied – so far. He is the head of the investment bank’s European operations and has been tipped as a possible leader for the bank. The 42-year-old former bond trader, who joined Goldman straight from Manchester University in 1986, is a protégé of Lloyd Blankfein, the bank’s chairman and chief executive. He is based in London with his co-chief executive Richard Gnodde, who was brought in to temper his aggressive style.

25 - Anna Mann, the doyenne of City headhunters, prefers putting others in the spotlight to basking in it herself. It has been suggested that she has placed 60 FTSE chief executives in their jobs, yet in more than 30 years she has rarely given an interview. The website of MWM Consulting, the executive search agency that she set up after moving on from Whitehead Mann, which she also founded, bears the e-mail address of every consultant – except hers. Her most recent coup was the appointment of Bryan Sanderson as chairman of Northern Rock. A patron of the Royal Shakespeare Company, she has a doctorate in psychology.

26 - Peter Sutherland. The chairman of BP had one of the less enviable roles of 2007 – having to preside over the sudden departure of Lord Browne of Madingley when the former chief executive was mired in personal scandal. The Irishman, 61, has been chairman of the petroleum giant since 1997, is also chairman of Goldman Sachs International and a nonexecutive director of the Royal Bank of Scotland. He ran the General Agreement on Tariffs and Trade before becoming the head of its successor body, the World Trade Organisation, and was a European Commissioner from 1985 to 1989. Attorney-General of his home nation from 1981 to 1984, he holds an honorary knighthood and has awards from governments as diverse as France, Brazil, Portugal, Morocco, Spain, New Zealand and Belgium.

27 - Sir Robert Wilson is chairman of BG, the resources company that grew out of British Gas, and a nonexec at GlaxoSmithKline, the pharmaceuticals concern. But this tells only a fraction of the Bob Wilson story. He is one of the best-connected British businessmen, yet spent most of his career with one company. He joined Rio Tinto Zinc, the miner, in 1970, after short spells with the Mobil oil group and Dunlop, the tyre maker. He became chief executive in 1991. When RTZ merged with CRA to form Rio Tinto in 1996, he became deputy chairman. He served as executive chairman from 1999 to 2003.

28 - John Varley is the chief executive of Barclays, the bank, and a nonexecutive director of AstraZeneca, the heir to ICI, the corporation long seen as the bellwether of British industry. Mr Varley has been tested in recent months, as Barclays’ attempt to buy the Dutch bank ABN Amro foundered and credit crunch pressures built. Mr Varley joined Barclays in 1982 and became chief executive in 2004. He is a member of the international advisory panel of the Monetary Authority of Singapore, chairman of Business Action on Homelessness, president of the Employers’ Forum on Disability and a director of Ascot racecourse.

29 - Sir Victor Blank was the youngest partner of Clifford Turner, the law firm that became the legal giant Clifford Chance, before making his name at Charterhouse Bank in the 1980s, where he masterminded a management buyout of Woolworths. His biggest present job is as chairman of Lloyds TSB, the bank. Previously he has chaired Trinity Mirror, the newspaper publisher, and GUS, formerly Great Universal Stores, which has split into Home Retail Group, Experian and Burberry. He is patron of the Royal College of Obstetricians and Gynaecologists, chairman of the charities Wellbeing of Women and UJS Hillel, and a Fellow of St Catherine’s College, Oxford.

30 - John Buchanan is a serial nonexecutive director and holds positions at four FTSE 100 companies: Vodafone, the mobile telecoms giant; BHP Billiton, the mining company that is trying to consummate one of the largest deals the industry has seen by buying Rio Tinto, its rival; AstraZeneca, the drugs company; and is chairman of Smith & Nephew, the medical instruments maker. A New Zealander, he cut his teeth at BP, which he joined in 1970, rising through the ranks to be finance director from 1996 to 2002.

31 - Hugh Osmond has made huge personal fortunes out of two different sectors: leisure and financial services. He and Luke Johnson bought and floated PizzaExpress. When they went their own ways, Mr Osmond launched Punch Taverns in 1997 through the £564 million acquisition of Bass’s leased pubs division. Two years later, he snatched Allied Domecq’s pubs division from under the nose of Whitbread with an audacious £2.7 billion bid. Having floated Punch, he made an even more audacious move, a £7 billion-plus bid for Bass itself. In 2004 he made his first move in financial services with the £1 billion purchase of the Pearl life insurance business. At the end of last year he swallowed the even bigger Resolution in a deal worth almost £5 billion.

32 - Lord Sharman of Redlynch has enjoyed a long and distinguished career. His biggest present job is as chairman of Aviva, the insurance giant that grew from the combination of Norwich Union, General Accident and Commercial Union. He holds the same post at Aegis Group, the media services firm. He is also a nonexecutive director at the energy firm BG Group and publisher Reed Elsevier. He spent most of his early career as an accountant at KPMG, joining in 1966, rising to become chairman in 1997, a post he held for two years. He is now a spokesman in the Lords on trade and industry.

33 - Bob Wigley, the chairman of Merrill Lynch’s business in Europe, the Middle East and Africa, has a client list containing many of the names featured in The Times Power 100, including Sir Philip Green and Allan Leighton. The 46-year-old, who helped to build Merrill’s presence in Europe, chairs Oxford University’s Centre for Corporate Reputation and sits on the Financial Services Authority’s Senior Practitioner Committee. He is the business ambassador for Whizz-Kidz, the disabled children’s charity. His first brush with fame was when he wrote to Margaret Thatcher, then Prime Minister, after winning a national enterprise competition.

34 - Sir Michael Rake. Industry-watchers expecting a big media name to take over from Sir Christopher Bland as chairman of BT were left somewhat deflated when Sir Michael Rake, a lifelong accountant, was appointed in February – but the 58-year-old’s extensive global experience at KPMG, where he was chairman of KPMG International for five years from 2002, is likely to prove invaluable to the phone giant as it seeks to cement itself as a global telecoms player. Sir Michael, whose hobbies include polo and skiing, joined KPMG in 1974 and was elected UK senior partner in 1998.

35 - Sir Stelios Haji-Ioannou, or Stelios, as he prefers to be known, is Mr Easy. Most famous for his no-frills airline easyJet, the 40-year-old Greek is rolling out his distinctive orange brand in all directions, from hotels to watches. He has been widely credited with transforming the travel industry through easyJet, the budget airline he set up in 1995, with a helping hand from his shipping tycoon father. His numerous ventures including Stelmar Shipping, which he floated on the New York Stock Exchange in 2001.

36 - Nicholas Macpherson, as Permanent Secretary to the Treasury, is Alistair Darling’s most senior civil servant and has a key influence in economic policy. A close ally of Gordon Brown, he joined the department in 1985 and worked his way up to become Principal Private Secretary to Ken Clarke, the former Conservative Chancellor, before managing Mr Brown’s takeover after Labour’s 1997 election win. Previously an economist for the CBI and Peat Marwick Mitchell, which is now KPMG, he was criticised for not consulting businesses over the controversial changes to capital gains tax announced in the latest PreBudget Report. He worked on the economic and monetary union section of the Maastricht Treaty.

37 - Baroness Hogg became the first woman to chair a FTSE 100 company when she took the helm at 3i, the venture capital investment firm, in 2002. Sarah Hogg, who is married to the former Conservative minister Douglas Hogg, was originally a financial journalist and worked for The Economist, Channel 4 News, The Independent, The Daily and Sunday Telegraph, The Sunday Times and The Times. Between 1990 and 1995 she worked for John Major, the former Prime Minister, as head of the No 10 policy unit.

38 - Arun Sarin, the Vodafone chief executive, has steered the world’s largest mobile phone company back from the slough it found itself in after the dot-com crash that prompted a 75 per cent fall in the share price. He joined Vodafone in 1999 when it acquired AirTouch, the US mobile business. After a stint as head of Vodafone in America, he became a nonexecutive director, impressing enough to be handed the top job in 2003. Mr Sarin, 53, left India in 1975 to study engineering at Berkeley but ended up at business school. After spells in consultancy and the oil industry, he joined Pacific-Telesis, the Californian phone group, whose mobile unit became AirTouch. This year he was chosen by Gordon Brown to join his council of business advisers.

39 - Lord Burns served successive chancellors at the Treasury. From 1980 he was the Treasury’s chief economic adviser and from 1991 to 1998 he was Permanent Secretary. He joined Abbey National, the former building society that has since been taken over by Santander, the Spanish banking group, as deputy chairman in 2001 and became chairman in 2002 and now serves as a nonexecutive director of Banco Santander. He joined British Land in 2000 and stayed until 2005. He joined Marks & Spencer in 2005, stepping up to be chairman in 2006.

40 - Michael Grade is the cigar-chomping, red braces-wearing executive chairman of ITV. The son of Leslie Grade, the theatrical agent, and nephew of Lew Grade, one of commercial television’s founding fathers, he joined the Daily Mirror as a sports reporter in 1960 before working at the family’s theatrical agency. He joined LWT in 1973 as deputy controller of programmes (entertainment) and became director of programmes in 1976. After a stint in television in America, he became controller of BBC One in 1984. He took risks, including clearing the schedule for Bob Geldof’s Live Aid in 1985 and showing Neighbours at the later time of 5.35pm, a move that paid off. In 1988, he joined Channel 4 as chief executive. He became chairman of Camelot in 2002 before joining the BBC as its chairman in 2004. He was appointed at ITV last year.

41 - Philip Yea, chief executive of 3i, has emerged as one of the private equity story’s most articulate exponents. Cool and calm in the face of intense questioning by trade union critics and MPs, he presents cogent and forceful arguments. He has had a busy year. 3i bought Agent Provocateur, the lingerie brand, and Inspicio, the testing company, while shelving a controversial plan to sell National Car Parks. Mr Yea became 3i chief executive in 2004 and joined Vodafone’s board as a nonexecutive director in 2005. He worked for Mars and Perkins Engines, but spent much of his career with Diageo and its predecessor Guinness. He was with Guinness from 1984 to 1988, rejoined in 1991 and was finance director of it and Diageo from 1993 to 1999. He then spent five years with Investcorp. In 1995 he joined William Baird as a nonexecutive director. In 1999 he joined Halifax as a nonexecutive director, staying on when it merged with Bank of Scotland to form HBOS, until 2004. Mr Yea, who attended Wallington High School in South London and Brasenose College, Oxford, was on Manchester United’s board from 2000 to 2004.

42 - Mervyn Davies is chairman of Standard Chartered. Strong in emerging markets, Standard has attained a market capitalisation, at £26 billion, equivalent to Lloyds TSB. Mr Davies grew up near Abersoch in North Wales in a Welsh-speaking family. He spent ten years at Citigroup between 1983 and 1993, when he joined Standard Chartered. He courted controversy when he swapped the chief executive’s role for the chairmanship in 2006, against the recommended best practice. Mr Davies has been a non-executive director of Tesco, the supermarket, since 2003 and holds a similar role at Tottenham Hotspur, the football club he supports. His interests include Welsh opera, art and antiques.

43 - Ed Richards, a former Downing Street policy adviser, was appointed the chief executive of Ofcom, the communications regulator, in October 2006. Mr Richards’ interest in politics spreads to all areas of his life. His wife is a former Welsh Assembly member and he is said to be close to James Purnell, the Culture Secretary. When Mr Purnell was a researcher for a rising shadow cabinet minister called Tony Blair, Mr Richards was next door in the office of Gordon Brown and the two advisers collaborated on Labour’s 1992 election campaign. Ofcom’s interventions this year read like a list of the industry’s biggest stories of 2007 – the Celebrity Big Brother race row, the premium-rate call-TV scandal and BSkyB’s purchase of a 17.9 per cent share in ITV. Mr Richards was controller of corporate strategy at the BBC, a consultant at London Economics and a researcher with Diverse Production, where he produced programmes for Channel 4.

44 - Nick Land. As a newly qualified accountant in the late 1960s Mr Land was a contemporary of Sir Michael Rake, the chairman of BT. Mr Land moved on to Ernst & Whinney and, when it merged with Arthur Young in 1992, was part of the merger integration team that created Ernst & Young. Mr Land led E&Y for 11 years until 2006 – while Sir Michael was his opposite number at KPMG. Like Sir Michael, he has moved into a corporate role. In 2006 Mr Land collected four non-executive directorships: at Vodafone; Royal Dutch Shell; BBA Aviation, the aircraft services firm; and Ashmore, the fund manager. He sits on the advisory board of the Judge Business School at Cambridge and is an adviser to Delta Three, one of the funds set up by the Qatari Royal Family. Mr Land is a keen supporter of the arts and is director of the National Gallery.

45 - Sir Ronald Cohen was considering a career in politics when he discovered venture capitalism. With three friends, he founded the company that became Apax Partners, which financed more than 500 start-up firms, some of which became national institutions, and invested in Waterstone’s, Yellow Pages and AOL, among others. He is often credited with taking venture capitalism from the periphery to the mainstream. He left Apax in 2006 with more than £10 billion under management. Having stood for the Liberals in elections in the 1970s, he switched to Labour in 1996, donated generously to Tony Blair and is closely linked to Gordon Brown. Having left Apax, he heads trusts that seek private-sector, commercial solutions to social deprivation in Britain and to conflict in the Middle East. He is chairman of the Social Investment Task Force and the Commission on Unclaimed Assets. His third marriage has lasted more than 20 years and he cites it as his greatest achievement.

46 - Sir James Dyson has built up a £1 billion fortune from his bagless vacuum cleaners and, in the process, has become one of Britain’s most successful entrepreneurs. Sir James settled on the Dyson design after studying more than 5,000 prototypes in an R&D operation funded by a loan from a high-street bank. He replaced Hoover as the market leader in America in 2005. Sir James studied at the Royal College of Art in the 1960s. By 28 he had created the Ballbarrow, which used a ball in place of a wheel.

47 - Jeroen van der Veer was appointed as chairman of Shell in 2004, when the Anglo-Dutch oil giant was immersed in a scandal over the misreporting of its reserves, which led to a plunging share price and the departure of several key executives, including his predecessor Sir Philip Watts. The Dutchman was the first chief executive in the company’s 100-year history after the ending of its Anglo-Dutch dual ownership structure. He has been responsible for Shell’s big push into unconventional oil sources, such as Canada’s tar sands and renewable energy. Born in 1947, Mr van der Veer studied mechanical engineering at Delft University and economics at Rotterdam University before joining Shell in 1971, working in the Netherlands, Britain, Curaçao and America before taking the top job. A nonexecutive director of Unilever since 2004, he was a supervisory board member of the Dutch Central Bank from 2000 until 2004.

48 - Michael Geoghegan has one of the biggest jobs in world banking. HSBC, his employer since 1973, is one of the world’s largest banks. Mr Geoghegan has spent most of his career outside the UK and was described as “pugnacious and impatient” when he was appointed HSBC chief executive in 2006. He is also chairman of Young Enterprise, which encourages students to run their own businesses.

49 - Sir Tom McKillop spent most of his career in pharmaceuticals, latterly as chief executive of AstraZeneca. He joined Zeneca as a chemistry research assistant in 1969 when it was the drugs arm of ICI and rose to become chief executive after the merger with Astra, of Sweden. He is now one of the most highly placed non-executive directors, combining the chairmanship of Royal Bank of Scotland with a board seat at BP. From 1999 to 2004 he was a nonexecutive at Lloyds TSB and held a similar role at Nycomed Amersham, the medical devices group, from 1992 to 2001. In 2004 he was asked to chair an industry-led Science Forum to explore cooperation between government, academia and the private sector on research and development.

50 - Hector Sants is a poacher-turned-gamekeeper. He joined the Financial Services Authority in 2004 after a 27-year career in investment banking, with Donaldson Lufkin & Jeanrette and Credit Suisse First Boston. He became the FSA’s chief executive last July. When he was appointed, the City had reasons to view him as one of their own. Mr Sants, 52, took charge of the City watchdog’s day-to-day operations as Northern Rock was teetering on the brink. He will play a key role in the reformation of the Tripartite arrangement for sharing regulation between the FSA, the Bank of England and the Treasury.

51 - George Osborne is one of the Conservative Party’s fastest-rising stars and, as Shadow Chancellor, will have a greater influence than his predecessors as business and the economy become a key battleground in Parliament. He has fought the Government hard on issues such as the Northern Rock debacle. Mr Osborne is arguably the architect of Labour’s inheritance tax and stamp duty policies. The MP for Tatton has worked in politics all his professional life, aside from a short spell as a freelance journalist, and is married to the writer Frances Osborne.

52 - Lord Hollick is a non-executive director of Diageo, Kohlberg Kravis Roberts, the Nielsen Company and Honeywell International. A leading Labour peer, he was chief of United Business Media. Lord Hollick, a grammar school boy whose father was a French polisher, has served as a non-executive director of British Aerospace, Logica, National Bus Company and Hambros Bank. He was managing director of MAI, the money broker, from 1974 to 1996. He is a trustee of the Institute for Public Policy Research, the influential Left-leaning think-tank that he founded in 1986.

53 - David Mayhew. is the man behind Cazenove’s sterling reputation around the City. He joined the company in 1969 from Panmure Gordon, became the firm’s dealing partner in 1972 and headed its capital markets department from 1986 until 2001, when he was appointed chairman. He has transformed the company, issuing shares to partners, staff and institutional investors, and was planning to stage an IPO. His reputation as a trusted adviser to some of the country’s biggest companies has stood firm, even in the face of his connection with the infamous Guinness share support scheme, for which charges were later dropped.

54 - Jim Ratcliffe is the founder, chairman and chief executive of Ineos, the world’s third-largest petrochemicals group and one of Britain’s largest private companies. He is dubbed Britain’s most private billionaire. He led a management buyout of Inspec in 1992, selling it for 15 times its value in 1998. He founded Ineos in 1998 and embarked on an unprecedented acquisitions spree. In 2005 it acquired Innovene, formerly BP chemicals, in a $9 billion cash deal that quadrupled the size of Ineos. A chemical engineer by training, Mr Ratcliffe, 56, lists garden tractors among his interests.

55 - Susan Murray is a former chief executive of Littlewoods, the Liverpool-based retailing empire, and a sought-after non-executive director. She sits on the boards of five FTSE companies: Enterprise Inns, Imperial Tobacco, SSL International, Compass and William Morrison, and is a council member of the Advertising Standards Authority. She was president and chief executive of Smirnoff. From 2000 to 2002, she was also a nonexecutive director of Aberdeen Asset Management.

56 - Ian Wace is a co-founder of Marshall Wace Asset Management, one of Europe’s biggest hedge funds with about $14 billion under management. He became the youngest director of SG Warburg at 25 and was head of equities trading at Deutsche Bank, before quitting to launch Marshall Wace in 1997 with Paul Marshall. Mr Wace is one of the founders of the Absolute Return for Kids charity, which brings together the celebrity and financial worlds to raise money for children. He also uses his money to help to launch new hedge fund managers through the firm’s Eureka Strategic Partners. A supporter of the Conservatives, Mr Wace is a friend of Michael Heseltine.

57 - Nigel Boardman is a corporate partner at Slaughter and May, the City of London’s top legal firm. Best-known for high-profile mergers and acquisitions work – including defending Marks & Spencer against the hostile advances of Sir Philip Green and for steering the Astra-Zeneca merger – Mr Boardman is as comfortable advising on billion-pound bids as he is on mundane company restructurings. Aside from a year as a corporate financier at Kleinwort Benson, Mr Boardman is a Slaughter and May lifer and led the firm’s peerless corporate department for eight years during the dot-com bubble and subsequent downturn. He advises more chiefs of FTSE 100 companies than any other lawyer. The son of Lord Boardman, a Conservative cabinet minister who later chaired NatWest, Mr Boardman turned to law after reading history at Bristol. Married with five daughters and one son, he divides his spare time between his farmhouse in France and Arsenal’s Emirates Stadium, which, as the club’s chief legal adviser, he helped to finance.

58 - John Connolly has spent his entire career at Deloitte. His fellow partners have consistently voted in favour of him staying in charge of the big four firm that he has revolutionised in recent years. He has insisted that the company retains its consulting arm, the only big accountancy practice to do so, and plays a significant role in advising some of the firm’s biggest clients, such as Royal Bank of Scotland, Vodafone and Kohlberg Kravis Roberts. Mr Connolly is outspoken, calling for transparency from his peers. The 57-year-old is a Manchester United season ticket-holder and a keen race-goer.

59 - David Blitzer, the managing director of Blackstone in Europe, was hand-picked to launch the European office in 2002. The 37-year-old has been tipped to succeed Stephen Schwarzman, Blackstone’s founder and chief executive. Under Mr Blitzer, Blackstone pulled off the acquisition of Scottish & Newcastle’s pub business, which merged with Spirit Group to create a £3.5 billion group, and the purchase of Southern Cross, the care home company. A graduate of University of Pennsylvania’s business school, last summer he was hauled in front of the Treasury Select Committee, with the industry’s other leading lights.

60 - Ken Hydon is a non-executive director of three large FTSE 100 companies: Tesco, Reckitt Benckiser and Pearson. He was among the cabal, which included Sir Christopher Gent and Sir Julian Horn-Smith, who transformed Vodafone into a global colossus from a small subsidiary of Racal Electronics. He joined Racal in 1977 and was finance director of Vodafone from 1985 to 2005. Mr Hydon, 63, is a nonexecutive director of the Royal Berkshire HNS Foundation Trust, the healthcare provider.

61 - Eric Knight is known as the “polite agitator”. The Dutch-born investor has made a big name for himself for someone who takes only small stakes in companies. He rose to prominence when Knight Vinke, his firm, took a stake in Royal Dutch/Shell and rallied others to help him to push for change. When Shell united its British and Dutch wings, Mr Knight was given much of the credit. More recently, he has been taking on another behemoth, this time in the financial services world at HSBC.

62 - Dominic Murphy is the 40-year-old wunderkind at the American private equity firm Kohlberg Kravis Roberts who beat the odds to see his firm acquire Alliance Boots in a £11.1 billion takeover. It was the first FTSE 100 company to be taken into private equity ownership and remains the largest leveraged buyout in Europe to date and the last big deal to squeak through before the credit markets came to a crashing halt. Mr Murphy famously told jittery MPs on the Treasury Select Committee that he would welcome more and cheaper debt with open arms and that tax-wise he was domiciled in the Irish Republic, not the UK. Why? they asked. It’s none of your business, he replied.

63 - John Fingleton The Competition Commission may have the teeth, but it is the Office of Fair Trading (OFT), whose chief executive since 2005 has been John Fingleton, that sets the agenda. Last year the banks, BAA and the supermarkets were in its sights. Mr Fingleton, an economist, was previously in charge of the Irish Competition Authority. At the OFT he has brought a tighter focus to a smaller number of high-profile issues. The watchdog does not have the resources, he says, for “fishing expeditions”.

64 - Lord Grabiner, QC, is head of One Essex Court, the country’s top commercial chambers. Reputed to charge £3,000 an hour, landmark cases include the Equitable Life saga. More recently Lord Grabiner, the son of an East End fur cutter, cemented his reputation when he told a judge that “even a moron in a hurry” could tell the difference between his client, Apple Computers, and the Beatles’ Apple corporation. He is chairman of Arcadia, one of only a handful of practising lawyers to chair a leading British company. He is a graduate of the London School of Economics, which he has served as chairman of the Court of Governors.

65 - Simon Robertson is a grandee of the City of London. He may be moulded in the old school, but, as the senior nonexecutive director of HSBC, is being tested by some of the toughest demands posed by modern capitalism. Knight Vinke, an activist shareholder, has aimed withering criticism at the management and strategy of the largest London-quoted bank. Mr Robertson joined Kleinwort Benson, the merchant bank, in 1963 and rose to become chairman in 1995. In 1997 he left to join Goldman Sachs as managing director and subsequently became president of the US bank in Europe. Mr Robertson has been chairman of Rolls-Royce since January 2005. He is also a nonexecutive director of The Economist Group, Berry Bros & Rudd, the wine merchant, and of the Royal Opera House. He chairs the trustees of the Royal Academy and is a trustee of the Eden Project.

66 - Paul Myners qualified as a teacher and worked for the Inner London Education Authority, which he describes as “a mistake for both of us”. After two years he became a business journalist and later spent 11 years at the investment bank NM Rothschild and another 16 years with Gartmore, the investment manager. He was commissioned by the Treasury to compile a number of reports, including one in 2000 to review institutional investment in the UK. After retiring from Gartmore in 2001, he took on a number of chairmanships and directorships at companies including the Guardian Media Group and Marks & Spencer. He is married with five children and lives in London and in Cornwall.

67 - Sir David Michels is Britain’s premier corporate hotelier of the past 40 years. He spent most of his early career with Grand Metropolitan and Ladbroke Group before spending much of the 1990s turning around the fortunes of Stakis, the struggling Scottish hotelier. He sold the business to Ladbroke, later renamed Hilton Group, and became group chief executive of the enlarged company in 2000. Sir David, who 40 years earlier had failed his finals at Hendon Technical College, stepped down six years later after overseeing the £3.3 billion sale of Hilton’s hotel business to Hilton Hotels Corporation of America, reuniting the Hilton brand globally for the first time since 1964. He spends much of his time as senior European strategist to Strategic Hotels & Resorts, the US hotel property investor. He has an impressive array of nonexecutive directorships, including British Land, Marks & Spencer, easyJet, RAB Capital and Jumeirah Group, the Dubai-based luxury hotelier. He is a trustee of the Anne Frank Trust.

68 - Bryan Sanderson was parachuted into Northern Rock, the stricken mortgage bank, in October when Matt Ridley vacated the chairmanship. As a former chairman of Sunderland Football Club and chair of the city’s regeneration quango, he has plenty of local knowledge. He also knows a thing or two about banking – he was chairman of Standard Chartered from 2003 to 2006. Mr Sanderson sat on the board of Six Continents, the renamed Bass brewing empire, from 2001 to 2003 and was a nonexecutive director of Corus, formerly British Steel, from 1994 to 2001. He spent much of his early career with BP, rising to head its chemicals business.

69 - Marcus Agius, chairman of Barclays, former chairman of BAA, former chairman of Lazard London, is a man of smooth, unshakeable charm. Before leaving Lazard at the end of 2006, he had owned the same house, been married to the same wife and had the same job for 33 years. But while the name of the company stayed the same, the work changed hugely. Mr Agius joined Lazard in 1972. The company was protected from being bought up in the 1980s by being majority-owned by Pearson but was eventually floated in 2005. At BAA, first as a nonexecutive director and then, from 2002, as chairman, he orchestrated the £10.3 billion offer from Ferrovial in 2006. Asked that same year whether he would be chairman of Barclays, it took him a “nanosecond” to say yes. A keen gardener, his wildflower meadow is, apparently, a sight to behold.

70 - Sir Philip Hampton is a shrewd and decisive boardroom player who earned a formidable reputation as finance director of four FTSE 100 companies. He was with British Steel from 1990 to 1996, British Gas from 1996 to 2000, British Telecom from 2000 to 2002 and Lloyds TSB from 2002 to 2004. Sir Philip trained as an auditor with Coopers & Lybrand and spent nine years at Lazard, the investment bank. He served as a nonexecutive director of RMC, the cement maker, from 2002 to 2005, but it is as chairman of J Sainsbury, the supermarket, that he has gained a high public profile. Sir Philip is a keen sailor and has competed in the ARC transatlantic yacht race.

71 - Jon Moulton is the managing partner Alchemy Partners and one of the founding fathers of the modern private equity industry. He played a part in setting up Permira, originally an arm of Schroders, in 1985, as well as setting up Alchemy in 1997 after leaving Apax. Given the success he has achieved, it is ironic that Alchemy is best known for trying to buy Rover – a deal that did not work out. Success, however, comes to dealmakers with the courage to walk away.

72 - Mary Francis has worked at the heart of government and the head of business. She has been a senior civil servant, spending four years as deputy private secretary to the Queen, and three years as the economic and domestic affairs private secretary to John Major. She was director-general of the Association of British Insurers from 1999 to 2005. She earns her place in this list as the nonexecutive director of four large quoted companies: Aviva, the insurer; Centrica, the gas supplier; Alliance & Leicester, the mortgage bank; St Modwen Properties; and the Bank of England.

73 - Lord Coe, chairman of the London Organising Committee of the Olympic Games, is a double Olympic gold medal-winner and former Tory MP. The hot seat he fills is likely to get hotter as pressure on costs increases. At the last count they exceed £9 billion. Fears of ballooning costs will also sharpen scrutiny of the postGames use of the facilities and the intention to regenerate run-down areas of East London.

74 - Lady Patten worked in the corporate banking division of Citibank before joining Wells Fargo in 1981 and PA Consulting in 1985. Lady Patten of Wincanton is nonexecutive chairman of Brixton, the property company, and nonexecutive of Bradford & Bingley, the demutualised building society, and Marks & Spencer. She sits on the advisory board of Bain, the management consultant.

75 - Lord Stern’s weighty report into the economics of climate change made the former World Bank chief economist a household name. But it also confirmed him as a voice that will be heard outside the circles of policy wonks and professional economists, among whom he has long been influential and revered. Lord Stern, a former Treasury official, serves as a cross-bencher in the House of Lords, as well as continuing his research at the London School of Economics.

76 - Nat Rothschild. The 36-year-old son of Lord Jacob Rothschild has a surname that is synonymous with wealth and power. The Oxford history graduate is co-president of Atticus, a hedge fund with about £10 billion under management. Atticus flexed its muscles in dramatic fashion last year when it built up a stake in Barclays, then pursuing an ambitious plan buy ABN Amro, its Dutch rival. Mr Rothschild, worth an estimated £1.3 billion, is one of the financial world’s most eligible bachelors and has been seen out with Petrina Khashoggi, Ivanka Trump and Natalie Portman. He is a director of RIT Capital and Champps Entertainment, an American “beer, burgers and sports” chain. He is chairman of JNR, a London-based investment company, and Vivarte, a French clothes retailer.

77 - Simon Cowell’s reputation as television’s Mr Nasty betrays the business nous that he has used to build an entertainment empire on both sides of the Atlantic. Mr Cowell has positioned himself as both producer and judge on talent shows such as X-Factor, Britain’s Got Talent and Inventor. Through American Idol he has also become US television’s third-biggest earner. Last year he is estimated to have earned £22.5 million and his wealth is estimated at £100 million.

78 - Charles Dunstone. The co-founder and chief executive of Carphone Warehouse launched the business with savings of £6,000 and the help of David Ross, his school friend from Uppingham, in a gloomy warehouse in West London. Today the company – in which Mr Dunstone has a 33 per cent stake – is Europe’s biggest mobile handset retailer and the UK’s third-biggest broadband supplier. This year Carphone entered the FTSE 100. It also acquired a 3 per cent shareholder in the form of BestBuy, the American retailer. Now speculation is rife that Mr Dunstone, 43, is plotting his exit through a sale to the US giant. Mr Dunstone, a keen sailor, is also a nonexecutive director of HBOS and of Daily Mail and General Trust.

79 - Sir David Clementi is chairman of Prudential, the insurer and fund management group, and a nonexecutive director of Rio Tinto, the mining company. He is a former deputy governor of the Bank of England and served as one of the first members of the Monetary Policy Committee. Sir David, an accountant, made his name in the City with Kleinwort Benson. He rose through the ranks of the merchant bank and helped it to advise the Conservative government on a string of privatisations. Sir David became Kleinwort’s chief executive in 1994. He is an honorary fellow of Lincoln College, Oxford.

80 - Roger Carr, together with Sir Nigel Rudd and Brian McGowan, helped to create Williams Holdings, a company that started on a forecourt in Derby and quickly grew into an engineering conglomerate. By 2000 Williams refocused itself on security and split itself into Kidde and Chubb. Mr Carr was chairman of Chubb from 2000 to 2002. In 2003 he was made chairman of Mitchells & Butlers and was appointed deputy chairman of Cadbury. He was made chairman of Centrica a year later. Mr Carr is a senior adviser to KKR.

81 - Dorothy Thompson is the chief executive of Drax. She has presided over a resurgence in the company, which produces 7 per cent of the UK’s electricity from a coal-powered plant near Doncaster. Recruited in 2005, just as rising energy prices were improving Drax’s ailing prospects, she floated the company on the London Stock Exchange. Ms Thompson has invested about £100 million in more efficient technology and biomass projects. She joined Powergen’s international arm in 1993 and in 1998 she joined InterGen, where she became head of the company’s European business.

82 - Sir Adrian Montague has been dubbed Gordon Brown’s favourite City fixer for the troubleshooting role that he has played for the Government in the past ten years. The former Linklaters solicitor and Kleinwort Benson banker has advised ministers, including the John Prescott, on the Private Finance Initiative, and played critical roles in the government-sponsored rescues of Network Rail and British Energy. Sir Adrian was also brought into Crossrail as chairman. His reputation for salvaging lost causes dates back to his time as an investment banker at Kleinwort Benson, where he led the Eurotunnel debt restructuring negotiations. Described by City sources as “silky smooth and assured” with spades of political sensitivity, the 59-year-old is a Cambridge University graduate.

83 - Richard Lambert, Director-General of the CBI and a former editor of the Financial Times. He has shown that the voice of British industry need not shout in order to be heard. This year he is likely to increase pressure on Alistair Darling to abandon capital gains tax reforms. Mr Lambert, 63, was appointed by Gordon Brown to the Bank of England Monetary Policy Committee, on which he served between 2003 and 2006. He joined the FT in 1966 after leaving Oxford and is married with a son and a daughter.

84 - Sir Deryck Maughan is a non-executive director of GlaxoSmithKline and Reuters and is chairman and managing director of KKR Asia. Sir Deryck is a former chief executive of Citigroup International and spent ten years at the Treasury before leaving in 1979. He was chief executive of Salomon Brothers between 1992 and 1998. He lives in New York and is married with one daughter.

85 - Sir John Parker’s biggest current role is as nonexecutive chairman of National Grid, the company that owns most of the electricity wires and gas pipelines. One of his first jobs was with Harland and Wolff, the shipbuilder based in his native Northern Ireland, and, having served as a nonexecutive director of P&O Princess Cruises, he is on the board of Carnival, its acquirer. Sir John was chairman of the sister company, Peninsular & Oriental Steam Navigation, before its purchase by Dubai Ports World, the Gulf-based logistics giant, and remains an adviser to the new owners.

86 - Paul Walsh, 52, shows that you do not have to hop between companies to secure a senior position in corporate life. Mr Walsh has worked for Diageo and Grand Metropolitan, its predecessor, since 1982. He became chief executive in 2000, having previously served as chief executive of Pillsbury, the food company then owned by the group. He joined Centrica as a nonexecutive director in 2003 and serves in a similar capacity in Federal Express, the mailing business, and Ceridian Corporation, the data management concern.

87 - Brendan Barber Trade unionists hold half, at most, the power that they did 30 years ago, when Brendan Barber joined the TUC, yet Mr Barber, general secretary since 2003, is a consciously modern leader of the organisation. He is an exponent of the new unionism that seeks closer cooperation between governments and companies. He favours integration with Europe and has been among the few voices seeking to extend rather than to limit the influence of Brussels. It would be a mistake to assume that he has forgotten the central purpose of his organisation, however. He is a vocal critic of the way that public sector workers are paid and has lobbied hard on behalf of those worried about the negative implications of private equity ownership.

88 - John Hutton, Secretary of State for Business, Enterprise and Regulatory Reform, was a keen supporter of Tony Blair who has become a key player in Gordon Brown’s Government. His appointment last June to the revamped Department of Business and Enterprise was considered part of Gordon Brown’s desire to cultivate closer links with the business community. His remit has also been to set greener standards for business, with an aim to hit lower carbon targets in future. Most recently, he has attracted controversy for his assertion that a new wave of up to 20 nuclear reactors must be built to meet power needs while reducing carbon emissions.

89 - Dame Marjorie Scardino was the first woman to become chief executive of a FTSE 100 company. She is now one of the longest-serving FTSE 100 chief executives, male or female, having guided Pearson, the educational publisher that also owns Penguin books and the Financial Times, since 1997. Dame Marjorie was president and then chief executive of the Economist Group, 50 per cent of which is owned by Pearson, between 1985 and 1997 and also served as a non-executive with AOL. She was appointed a Dame in 2002 and holds the Benjamin Franklin Medal for contribution to Anglo-American relations. She is a non-executive director of Nokia, the mobile telephone handsets manufacturer, and is a Trustee of the Victoria and Albert Museum.

90 - Sir Christopher Gent transformed Vodafone, the mobile telecoms company, from a glint in the eye of Racal Electronics, its original parent, into the largest company of its type in the world. The acrimonious and much-criticised acquisition of Mannesmann, the German rival, in 2000 marred Sir Christopher’s 18-year career at the Newbury-based company, but his record is one that has few comparators. He retired as chief executive of the company in 2003 and became nonexecutive chairman of GlaxoSmithKline, one of the world’s largest pharmaceuticals group, in 2004.

91 - Sir Philip Green. The Croydon-born wheeler-dealer leads an empire stretching from Bhs to Dorothy Perkins, taking in Topshop and Miss Selfridge along the way. Based in Monaco, Sir Philip’s jet-setting, celebrity-studded lifestyle has attracted the headlines: Kate Moss is a personal friend and last year he flew friends to the Maldives for his 55th birthday party, where they were entertained by George Michael. But a tough year awaits. “It was a bloody tough season,” he said of last year. “If you get out of a season like that alive, you’ve done good.” He has twice tried to win control of Marks & Spencer, having a hostile bid fended off by his old friend Sir Stuart Rose.

92 - Sir Richard Branson’s journey to billionairedom started with a mail-order record business in 1969. His unbounded ambition and keen eye for self-promotion have meant that there is hardly a national cause célèbre unconnected with Sir Richard. Most intriguing for this year, however, are his plans for Northern Rock. Sir Richard is vying with Luqman Arnold’s Olivant to take over the bank but there are big questions over whether either can raise the necessary finance.

93 - John Kelly Gala Coral is one of Britain’s biggest private companies and John Kelly, its chairman, is the man who created it. The company is now controlled by Candover, Cinven and Permira, and has 171 bingo clubs, 31 casinos and nearly 1,600 betting shops with total turnover last year of £1.3 billion. A flotation, tipped to value the company at up to £5 billion including debt, is likely in about two years’ time. Mr Kelly is also chairman of Trainline and serves on the board of Business in the Community.

94 - William Lawes is co-head of worldwide financial institutions practice at Freshfields Bruckhaus Deringer, the law firm. He was thrust into the spotlight last summer when key client Northern Rock ran into difficulty and is now advising the stricken lender on its negotiations with the Bank of England, the Treasury and a host of potential bidders. It also confirms his reputation as the lawyer of choice for major financial groups.

95- Lord Stevenson For years Dennis Stevenson, now Lord Stevenson of Coddenham, was the ultimate eminence grise of British business. A trusted behind-the-scenes confidant of business leaders and ministers, his own personal profile as chairman of consultants SRU was ultra-low. That all changed when he became chairman of Halifax, later HBOS, and of Pearson Group. Lord Stevenson, now 62, remains chairman of HBOS and is also a director of The Economist.

96 - Luke Johnson styles himself an unrepentant capitalist and for years wrote a column called The Maverick. It is no surprise, then, that the Channel 4 chairman is an entrepreneur of flair who organised the acquisition of PizzaExpress before he turned 30. He founded Signature restaurants, which owned The Ivy, Le Caprice and the Belgo diners. He also started the Strada restaurant chain from scratch. Having made several fortunes with apparent ease, his task at Channel 4 is to turn a profit from a broadcaster whose commercial roots belie a strong public service tradition.

97 - Sir Mark Moody Stuart has carved himself a reputation as a champion of health-related good causes. Sir Mark spent most of his career with Shell, the oil giant, which he joined in 1966 at the age of 25. He was chairman and managing director before serving as a nonexecutive director from 2001 until 2005. He has chaired Anglo American, the miner, since 2002, has served as a nonexecutive director of HSBC since 2001, and is a non-executive director of Accenture, the management consultancy. But he is also a governor of Nuffield Hospitals; president of the Liverpool School of Tropical Medicine, and chairman of the Global Business Coalition on HIV/AIDS.

98 - Robert Peston, business editor of the BBC, is a controversial choice, not least because there will be many who think his investigative journalism hinders rather than helps the commercial cause. But his voice, albeit characteristically hesitant, is one of the most authoritative. His success at the BBC, notably during the Northern Rock debacle, is based on his wide experience and keen intellect, some of which he appears to hide in order to convey key financial news items to his wide and largely untutored audience.

99 - Allan Leighton No one can suggest that Allan Leighton, chairman of Royal Mail, has fashioned the British postal service into a world-class business. Not yet at least. But he deserves all credit for taking on what must be one of the most difficult, yet critically important, management challenges there is. Mr Leighton is renowned for his attention to detail. At Mars, where he spent 18 of his early years, he went as far as eating the cat food produced by the group. He was one of the first self-appointed “pluralists”. He picked up a large handful of nonexecutive directorships after leaving Asda in 1999 - he has sat on the boards of Wilson Connolly, the housebuilder; lastminute.com; Leeds Sporting, the football club company; ScottishPower; Dyson; and BSkyB.

100 - Michael Todd, QC, is Britain’s top company law barrister. He is one of the first people to call for legal advice on complex corporate restructurings and contested takeovers. Mr Todd, of Erskine Chambers, has helped to solve some of the world’s most complicated business disputes during 30 years at the bar and is fêted for his clear and sound advice both in and out of the courtroom. Mr Todd advised Allied Domecq, the drinks group now owned by Pernod Ricard, when its retail division became the subject of a fierce takeover battle between Whitbread and Punch Taverns. He worked on the demergers of WH Smith and GUS and, after steering Hiscox, the insurer, through its trend-setting establishment of a Bermuda-based holding company, Mr Todd has developed a significant sideline advising on Bermuda and Cayman Islands structures. (source: Timesonline)

Nintendo Wii dominated Argos toys sales over Christmas

2008-01-18T00:59:00.000-08:00

Argos yesterday reported a fall in sales of traditional toys over the Christmas period after Britain's love affair with the Nintendo Wii video game console. Argos yesterday said that gaming and technology products dominated its list of bestsellers over the festive period. It took more than £4 million-worth of telephone and internet orders for the Wii console on November 30 alone.

Mr Terry Duddy, Chief Executive of Home Retail Group (owner of Argos) said: “We could have gone on selling everything Nintendo supplied. It wasn't a great Christmas for toys but games were up 40% year on year. Parents were happy to buy a Wii and put it in the front room for their kids.” The success of the Wii has already seen Game Group emerge as one of the winners on the high street over Christmas and the console also helped HMV to report record festive sales.

Argos limited the fall in overall like-for-like sales to 0.2% during the 18 weeks to January 5. Total sales were up 2.5% to £1.9billion and margins were flat. Mr Duddy said that group profits for the year to March should be up to £15 million higher than forecast in the City. He predicted £430 million to £435 million, a rise of about 15% on the previous year. Shares in the group close down 5p at 266p despite a rise in early trading. The shares are 35% below levels seen a year ago.

Argos said the internet accounted for 23% of sales over the festive period with a growing number of customers collecting their goods from the stores. (source: Timesonline) - Velocity Interactive Group - New Investment Company (article on Nintendo Wii’s Christmas predictions)

Qantas, the Australian airline, has said it will seek compensation from Boeing for its order of 65 of the fuel-efficient aircraft, after a second delay in the delivery of the planemaker's 787 Dreamliner jet. Qantas said that the further delays to the delivery announced earlier this week would hurt its growth plans.

Production problems mean Boeing will not start deliveries of the Dreamliner until early 2009, with Japan's All Nippon Airways due to be the first recipient. Qantas said it would not get the first batch of its planes before next May, although a delivery date was yet to be confirmed.

Other Boeing customers could also seek compensation for the delays - the second time the US firm has put back its planned production schedule because of manufacturing problems. The new delay, estimated at three-months, puts it 10 months behind schedule.

All Nippon Airways, which has 50 planes on order, said it would examine the effects the delays will have on its business before making a decision about whether to claim compensation. Other customers that could be affected include British Airways, Virgin Atlantic and First Choice, as well as a number of Chinese airlines. (source: BBC News) - Even more delays for the Dreamliner, BP fined for a record amount (Article on Dreamliner delays) (Also see Wednesday 12th December 2007 entry for more on this.)

Businessman of the Month – It is time that I continue with businessman of the month after I have not done this regularly as promised over the last couple of weeks. This has been due to the fact that I have been on holiday and did not have the time to regularly update the business news or concentrate on Businessman/personality of the month. With the holiday period now over, it is time to concentrate on this again. The businessman/personality of the month for February (since January is almost over) will be Mr Johann Rupert, Non-executive Chairman of the highly successful Remgro Group Ltd).

Profits for HMV

2008-01-17T02:34:00.000-08:00

HMV and Waterstone's bucked the trend of gloom on Britain's high street and predicted that full year pre-tax profits would be near the top end of the City's expectations after a glooming Christmas period by a bumper DVD, music and books line-up and strong growth online.

In stark contrast to the profit warnings and senior management departures that accompanied a dire Christmas a year ago, HMV said that like-for-like sales were up 9.4% in the five weeks to January 5 this year. HMV reported that it was the best growth by a long way since floating in 2002.

Chief executive Simon Fox, who has been pushing through an overhaul of the business to try to get to grips with shoppers' growing desire to buy online, said the changes had helped "deliver a highly successful Christmas. The product markets that we operate in have generally been buoyant, it was a very strong Christmas for DVD and for games. We've moved into higher growth areas like technology products."

HMV's shares jumped 14% to 115p in early trading after the company pledged that full-year pre-tax profits would "be towards the upper end of current market expectations"

Within the group, HMV UK & Ireland enjoyed like-for-like sales growth of 14.1% over Christmas. Waterstone's performance was less impressive, with sales at the bookseller up 4% on a like-for-like basis. However, the company's international business, which includes stores in Canada, Hong Kong and Singapore, saw like-for-like sales drop 0.6% over the key Christmas period. Fox said that was largely down to a Canadian rival going bust before Christmas and selling off its stock at clearance prices. (source: The Guardian)

Even more delays for the Dreamliner

2008-01-16T01:04:00.000-08:00

It is understood that the awaiting of Boeing's all-new 787 Dreamliner aircraft is facing additional delays. The company likely will face financial penalties for late deliveries as a result and this drove its stock price down nearly 5%.

Boeing is expected to announce up to a three-month delay, perhaps as early as Wednesday morning. The Dreamliner team is struggling with technical and manufacturing challenges, which include continuing parts shortages, preparations to ramp up production, and struggles to get the first plane ready for its inaugural flight.

Additional delays mean Boeing would be hard pressed to deliver 109 Dreamliners in 2009, as promised. As news of a potential delay began to spread, Wall Street wasted little time selling off the stock. Boeing shares fell 3.81 yesterday or 4.7%.

A Boeing spokesman on Tuesday declined to comment on reports that the Chicago-based aerospace giant was preparing to announce a further delay in the Dreamliner program. Boeing has announced orders for 817 Dreamliners from 53 airlines and leasing firms, pushing the list-price value of the program to $135 billion (£67.5 billion).

Boeing is trying to avoid copying the two-year delay that ensnared Airbus and its much larger A380 Super-Jumbo jetliner. What's more, further 787 delays could send some customers flocking to Airbus, which now has a much more credible lightweight, medium-size jetliner, the A350, to offer as an alternative. (source: Business Week) - BP fined for a record amount (Article on Dreamliner delays) (Also see Wednesday 12th December 2007 entry for more on this.)

Terra Firma, owner of EMI, plans to cut 2,000 jobs and reduce costs by £200 million. This was heard by more than 500 EMI employees who crowded into the Odeon cinema on Kensington High Street, near the embattled music company’s head office yesterday.

Two meetings of about an hour each were held for staff, who filled the cinema’s largest auditorium to hear a presentation from Guy Hands, chief executive of Terra Firma, the company’s new private equity owner.

Few of the 100 or so staff from the first meeting who emerged into the drizzle would comment, but those who did said that they were not angry at the prospect of mass redundancies, but accepted that EMI needed a new direction. Some said that the presentation by Mr Hands was “very inspiring” and that he had been given a round of applause.

Some of the 400 staff who left after the second meeting, which started at 11.30am and ended shortly before 1pm, said that they were worried about losing their jobs, but agreed that change was unavoidable.

Mr Hands slipped out of the cinema via the side door without commenting. Lord Birt, the former BBC director-general who joined Terra Firma as an adviser in 2005, also attended the event but refused to comment. (source: Timesonline)

Northern Rock board to face shareholder scrutiny

2008-01-15T00:46:00.000-08:00

The Northern Rock board is set to face a tough scrutiny from angry shareholders at an extraordinary general meeting of the crisis-hit bank. Many of the 100 000 smaller shareholders will attend this showdown at the Metro Radio Arena in Newcastle.

Northern Rock was at the centre of the UK's first bank run in nearly 150 years in September after soaring borrowing costs in the credit crunch forced it to seek an estimated £26 billion in emergency funding from the Bank of England. The board will argue that proposals from its two largest shareholders - hedge funds SRM Global and RAB Capital who jointly own 18% of the company and do not want it sold off - will hinder rescue efforts.

Potential bidders Virgin and Olivant are, however, reportedly struggling to secure financing for the deal amid a tightening in credit markets and due to the complexities of the deal. If these two bidders back off then the stricken bank could face nationalisation, although there are now claims that the move could breach the Government's self-imposed sustainable investment rule which says national debt should not exceed 40% of GDP.

Northern Rock chairman Bryan Sanderson is calling on shareholders to vote against the resolutions, labelling the demands "potentially damaging". The bank's board believes that the measures could tie their hands in engineering a rescue of the stricken bank. The Government is also reportedly looking at the possibility of a £12 billion to £15 billion bond issue which could help pay off some of Northern Rock's Bank of England loans and pave the way for a private sale. (source: ITN)

In a move likely to disappoint existing owners (according to analysts), Apple could soon offer a new iPhone with twice the memory but for the same price as the original device as an increase in capacity from 8GB to 16GB or even 32 GB is expected soon.

Speculation about the next stage in the iPhone’s development came as talks between Apple and China Mobile to launch the device in China were halted yesterday. In the United States, a 3G iPhone is also understood to be in production.

Mr Jobs, Apple’s CEO, is also expected to announce plans to enter the film-rental business, which will operate through its online iTunes Store. This is largely dependant on deals with the movie studios. It is believed that Apple might use Macworld as an opportunity to introduce such a service. (source: Timesonline)

Silverjet, the start-up business-class only airline, was the worst performing small cap stock yesterday after an analyst set a share price target of nil for the company and branded it "likely to fail". The note comes just three weeks after MAXjet, a rival business-class only carrier, filed for administration under a mountain of losses and debt.

Silverjet fell 28% to 35.5p. It issued a Stock Exchange announcement pointing out "numerous material mistakes and inaccuracies" in the note, including an assumption that return flights cost nearly twice as much to operate than they do in reality. The company said it remained confident that it would hit its target of reaching pre-tax profitability by March.

Silverjet, which began service a year ago this Friday, flies its fleet of three 767's – refitted to fit 100, lie-flat beds – from London to New York and Dubai. Silverjet's largest investors are the Reuben Brothers, who have given loans to the company convertible next month to a 22% stake.
Arden Partners, the company's broker, put out a note with an opposed view yesterday, urging investors on with a "Buy" rating and forecasting a more than quintupling of its 2007 revenue. (source: The Independent)

Merrill Lynch to write-off £8 billion this year

2007-12-21T02:06:00.000-08:00

Merrill Lynch, the troubled US investment bank, which is expected to be hit by a total credit crunch write-off of $16 billion (£8 billion) this year, is understood to be in advanced talks with the Singapore Government’s Temasek Holdings over a $5 billion (£2.5 billion) injection of capital. Merrill has been one of the world's biggest sub-prime casualties and is expected to write down a further $8 billion (£4 billion) in the fourth quarter, which could take its total mortgage losses this year to $15.9 billion (£8 billion).

It is understood that this morning, the board of Temasek has been given preliminary approval for the investment in Merrill, although price, timing and regulatory issues have yet to be negotiated. Analysts have suggested that if Merrill’s write downs get much worse, it could sell its 20% stake in Bloomberg, the financial information company, or its 49% stake in BlackRock, the US fund manger. Temasek Holdings is one of two Singapore Government investment vehicles and one of the oldest sovereign funds, with an estimated $108 billion (£54 billion) of assets and owns 15.3% of Standard Chartered, the Asian-focused UK bank.

On Wednesday, rival bank Morgan Stanley said it would sell a 9.9% stake to state run China Investment Corp for $5 billion (£2.5 billion) and last month Citigroup, received a $7.5 billion (£3.75 billion) of fresh cash from the Abu Dhabi Investment Authority. (source: Timesonline)

Oracle proves everyone wrong

2007-12-20T01:58:00.000-08:00

Concerns that slowing economic growth would cause key customers to throttle technology spending, were shucked yesterday by software industry mainstay Oracle. An expansion into specialty software markets and a tight rein on expenses helped Oracle turn in a strong second quarter and issue an upbeat outlook for the third, as net income rose 35%, to $1.3 billion (£650 million) in the quarter that ended November 30Th. Revenue increased 28%, to $5.3 billion (£2.65 billion), surpassing the $5.04 billion (£2.52 billion) expected by analysts. Sales of new software licenses, a closely watched indicator of future revenue, climbed 38%, exceeding Oracle's forecast that the bookings would increase between 15% and 25%.

CEO of Oracle, Larry Ellison, said “Oracle plans to expand into additional industry areas. That's our strategy for growth." Oracle also said revenue would increase between 21% and 24% in the current quarter, which ends in February. Analysts expected Oracle to increase revenues by 18% in the third quarter.

Oracle is the top supplier of database software and an emerging power in business applications, which companies use to forecast sales, plan production schedules, and manage budgets. Oracle has spent more than $24 billion (£12 billion) to buy more than 40 companies since the beginning of 2005 to gain ground in the applications market from leader SAP.

Analyst expected Oracle to fail in buying so many companies as they would fail to integrate all application. But they're just obliterating revenue and earnings expectations by acquiring companies. It proved that Mr Larry Ellison was right yet again as Oracle stock gained 6.6%, to $22.12 (£11.06), in extended trading. As of the close, Oracle shares had risen 21% in 2007, while shares of SAP have slumped more than 4%. (source: Businessweek)

Viacom Inc. said yesterday that it has selected Microsoft Corporation as its internet advertising partner in a five-year agreement initially valued at an estimated $500 million £250 million) that involves online games, shows and movies. Microsoft will help Viacom place advertising on Viacom's U.S. Web sites and be the exclusive seller of its remnant display advertising, or ad space Viacom has been unable to sell.

As part of the deal, Microsoft will also license on a non-exclusive basis long and short-form television and movies from Viacom for the MSN portal and the Xbox 360 game system's online network. Microsoft has also agreed to buy ads on Viacom's broadcast and online networks over five years and help Viacom establish itself as a publishing partner on Microsoft's casual Internet gaming sites.

The Redmond, Washington-based software maker has attempted to make inroads against Google Inc. online advertising business over the past year as each company has raced to purchase new advertising businesses. Yahoo signed a deal in April with Viacom to provide search advertising for 33 of its Web sites, which remains in place. (source: Reuters)

The Competition Commission has made its decision on the BskyB stake in ITV and confirmed that, the satellite broadcaster, should cut its stake in ITV to below 7.5% because the shareholding reduces competition in the all-TV market and works against the public interest.

If BSkyB sold 10.4% of its 17.9% ITV holding at the price of 84.2p, it would crystallise a loss of £205 million. John Hutton, the Secretary of State for Business, has until January 29, 2008, to consider the Competition Commission's report and announce final decisions, but in publishing the findings early he has indicated he is minded to accept its possible remedies.

The move re-opens the door for Virgin Media and other potential suitors to attempt a merger with ITV. As the market opened, shares in ITV rose by 1.2p to 84.2p on possible takeover speculation, while BSkyB shares were virtually unchanged.

The watchdog decided against forcing BSkyB to sell the whole of its 17.9 per cent stake as demanded by Virgin Group, saying that a partial sale was less intrusive and that with a holding below 7.5% Sky would be unable to materially influence ITV's strategy.

A statement from BSkyB said that the broadcaster was considering the contents of the Commission's report carefully. It said: "The next phase of this process lies with the Secretary of State. We will be making representations to him in due course." BSkyB snapped up the stake in ITV for £940 million, or 135p a share, in November 2006 when NTL, its pay-TV rival, was trying to mount a takeover.

BSkyB, where former chief executive James Murdoch replaced his father Rupert as non-executive chairman this month (News Corporation on taking over Dow Jones), has always insisted that it had not broken any merger rules when it acquired its ITV stake, which it called a long-term investment. (source: Timesonline) - Heathrow voted worst airport (article on BSkyB ITV shares), Virgin Lost 40 000 customers & Sainsbury's Bid dropped (includes aticle on Virgin & BskyB sales)

New bidder for Northern Rock

2007-12-19T03:31:00.000-08:00

A newcomer to save Northern Rock, Bradford & Bingley, has approached the stricken bank about buying assets. According to reports, the buy-to-let firm and mortgage lender is not looking to buy the troubled Newcastle-based bank outright, but could become part of a private-sector rescue package.

Two preferred bidders, Virgin Group and Olivant, are vying to take control of the stricken bank as discussed in earlier articles and press releases. Northern Rock has an attractive portfolio of mortgage assets which Bradford & Bingley would be happy to hold.

Bradford & Bingley, which has been plagued by concerns over its liquidity since Northern Rock's problems emerged, has, on paper, a more risky portfolio of lending since more than half of its business is in the buy-to-let market and 20% of its lending is on self-certified mortgages. Adding Northern Rock's quality assets to Bradford & Bingley should give ballast to the buy-to-let specialist's loan book.

Last month Bradford & Bingley went some way to easing fears over its liquidity by selling £4.2 billion of loans, which gave it a substantial cash cushion in preparation for further tightening of credit markets. Northern Rock's shares rose 6.6% this morning to 91.7p in early trading, while Bradford & Bingley's climbed 0.5% to 258.75p. (source: Timesonline) - Northern Rock dreams fading, New Bid for Northern Rock by Olivant, Northern Rock offers below value, Final bids for Northern Rock today, New player in Northern Rock bid, Virgin pushes forward in takeover, BAA must halve queueing times to avoid fines, SAB Miller to buy Royal Grolsch, BHP Billiton's offer rejected, News Corporation on taking over Dow Jones

Sports Direct today reported a 70% slump in first half profits and failed to name a new chairman for the troubled sportswear retailer after a seven month long search. The company, has issued two profit warnings since its flotation in February and blamed the decline on bad weather and the England football team's failure to qualify for the European Championships.

Profits for the six months to October 28 fell from £70.1 million to £21.2 million as sales fell by 7.1% to £668.1 million. Since floating in February, Sports Direct's shares have fallen in value by 70% to a current all-time low of 84.25p.

Sports Direct has been without a non-executive chairman since May when David Richardson, the former finance director at Whitbread quit after differences with the board.

Sports Direct refused to comment on its search for a chairman or its stake in Umbro, which is being pursued by Nike. Mike Ashley, Sports Direct's owner, added he had no intention of taking the company private. (source: Timesonline) - Northern Rock dreams fading, Alitalia SpA in sight for Air France-KLM, Sports Direct to block Nike takeover

The internet auction house formerly known as QXL Ricardo has been agreed to be bought by Naspers, Africa's largest media group. The sale for Tradus (new name for QXL), has been set for an all cash deal £946 million, which is £18 per share.

Having weathered the dot-com bust of the late 1990s, the FTSE 250-listed group has since been embroiled in a series of long-running legal disputes over the ownership of key assets, bitter shareholder wrangles and failed bids. The takeover will also unlock a £123 million payout to three managers of Tradus’s Polish operations.

The group of Polish executives, led by Arjan Bakker, was accused by the main board of what was then QXL Ricardo of wresting control of the Polish business "fraudulently", through an improper share issue. A three-year legal battle followed and that was finally settled with the fast-growing Polish unit, which also includes operations in the Czech Republic, Ukraine and a Hungarian joint venture, being reintegrated into the parent company.

EBay, the US online auction giant, which is currently planning a revamp of its own business, has held talks several times over the years with Tradus. Shares in Naspers fell as much as 11% in Johannesburg, with investors concerned over the agreed price.

The Naspers proposal represents a 19% premium to share price before Tradus revealed that it had received an approach, on November 7. Ahead of the approach being made public, Tradus traded at about 63 times earnings for the previous year, compared with about 26 times for eBay.

The company, which operates sites in Poland, Czech Republic, Hungary, Ukraine and Russia, is also is diversifying from trading & auction sites into classifieds advertising, price comparison sites and online payment services.

When the group received a failed bid from Florissant, a private equity group, in 2005 it was valued at less than £30 million. At its peak, the former dot-com darling, founded by the journalist Tim Jackson, was briefly worth more than £2 billion. Florissant, which holds a 15% stake, will join Izaki, the Israeli investor group, with 14%, in also receiving a windfall profit from the sale to Naspers.

Tradus recently reported a 165 per cent jump in first-half pre-tax profit, to £3.68 million. Naspers, meanwhile, has been expanding overseas. The group, which owns South Africa's largest daily newspaper, the Daily Sun, and the pay TV outfit MultiChoice, has been building up its operations in sub-Saharan Africa, China and Russia. (source: Timesonline)

Velocity Interactive Group - New Investment Company

2007-12-18T01:50:00.000-08:00

Two high-profile media and Internet executives will join with venture fund ComVentures to form a new investment company with $1.5 billion in assets. The two high-profile executives will be, former AOL Chief Executive Jonathan F. Miller and former Fox Interactive Media President Ross Levinsohn. The partnership with ComVentures will form a new group focused on investing in Internet and media companies, and will be announced today. The firm will be named Velocity Interactive Group.

ComVentures, Palo Alto, California, has focused on early-stage investments in communications equipment and services and the current fund of ComVentures's will move to the new company. It is providing the $1.5 billion (£750 million) in funding. Partners at the new firm said they will try to raise more money next year.

The firm is looking for investments in both early-stage companies and larger growth companies. Investments will be as small as $500 000 (£250 000), though Velocity expects investments in a company could grow to between $5 million (£2.5 million) and $30 million (£15 million). Velocity also plans today to announce its first investments. They include NDTV Networks, an Internet video and television producer in India. In the U.S. the firm has funded three companies that include Fabrik, a Web site consumers can use to store and manage their videos, photos and other digital creations.

Mr. Miller was chief executive of Time Warner Inc.'s AOL division from 2002 to 2006. Mr. Levinsohn formed News Corp.'s Internet division in 2005 and spearheaded the purchase of the social networking Web site MySpace.com. Mr. Levinsohn left News Corporation. in late 2006. (source: The Wall Street Journal)

Nintendo, makers of the sought after Wii video games console, will miss out on an estimated $1.3 billion (£639 million) in sales this Christmas by failing to meet soaring global demand for its Wii video games console.

Production has been hit by shortages of components and it insists it is doing all it can to meet demand. Some analysts believe, however, that the company privately welcomes tight supplies because it wants to delay market saturation to prolong interest in the console.

Nintendo has raised production targets several times in recent months and now plans to ship 17.5 million units globally this year, up from 14 million. It said that demand “has been higher than we could ever have anticipated and the company is withdrawing planned television advertising for the Wii because of severe shortages of the games console in the run-up to Christmas.”

Stock market investors appear to believe that Nintendo can maintain its success. Over the past two years the group’s shares have risen fivefold to make the company Japan’s third most valuable quoted business. However, last month Sony’s PlayStation 3 beat the monthly sales of the Wii in Japan for the first time, signalling that the battle between the two next-generation consoles may yet have further to run. Sony sold 183,217 PS3s in Japan in the four weeks to November 25, against sales of 159,193 for the Wii. (source: Timesonline)

Air France-KLM sought to deal a death blow to the rival airline bidding for Alitalia, Italy's loss-making national carrier, by unveiling a £530 million plan to refurbish the carrier's fleet. Yesterday, analyst saw the Franco-Dutch giant as the heavy favourite to win the 49.9% stake that is being auctioned by the Italian government. Air France is bidding against Air One, a domestic Italian carrier. Under Air France's plan, it would raise the £530 million through the issuance of new shares, which it would use to update the interior of Alitalia's planes and to launch a marketing plan to attract international clients back to the carrier. It would also replace the company's old Boeing 767s and McDonnell Douglas MD80s with new aircraft.

The Italian government is expected to make its decision today. If a definitive winner is chosen, it would bring to an end a long and sorry chapter for the Italian government, which first signalled its intention to sell its stake in the carrier a year ago. The process has run into problems repeatedly, most recently in October when the last of the previous bidders dropped out of the auction over objections to onerous terms that were being imposed by the government. (source: The Independent) - ArcelorMittal to by China Oriental Group Co., Alitalia SpA in sight for Air France-KLM

Arriva outperforming Virgin Rail

2007-12-17T03:16:00.000-08:00

Arriva boasted today that the sacking of Virgin from the long-distance CrossCountry train network has led to an immediate and dramatic improvement in performance. After a decade of disappointments since privatisation and despite the introduction of smart Voyager trains, Virgin Rail - a joint venture between Sir Richard Branson and Stagecoach - was relieved of CrossCountry on 11 November 2007.

In a thinly veiled attack on previous management, Arriva said today: 'With 86.3% of services arriving on time over the first four weeks of operation, that is substantially better than the equivalent services run in the same period last year.'

Arriva has not been immune from hashing up in the past, having been sacked from its North of England train franchise in a maelstrom of strikes and poor services, but it claims things have changed. According to the most recent National Rail Trends 2007-8 performance report, it is confirmed as the UK's most improved rail operator with 92.3% of its services arriving on time compared with 85.7% for the same period last year.

The company, which also runs buses in London, said it is on track to make the £121 million pre-tax profits expected by analysts. (source: thisismoney.co.uk)

Tata, is to be named as the preferred bidder for Ford’s Land Rover and Jaguar brands in the next few days as the Indian Company is trying to bring the world’s cheapest car to the South Asian country. Tata is the front-runner in a race that includes Mahindra & Mahindra, a fellow Indian car group, and One Equity, the American buyout group.

Tata is set to roll out a 100,000 rupee (£1,200) “People’s Car” next year. Ratan Tata, the chairman, has said that he wants the cut-price vehicle to help poorer Indians to upgrade from motorcycles, which currently transport entire families, to cars.

If Ford chooses Tata, it will be an historic moment for the car industry, marking the first time that a major Western car group has been bought by an Indian company. Ford, the US carmaker is expecting to make up to £1 billion from the sale, although it is expected to keep some form of equity interest in the devolved business.

Tata, a conglomerate whose interests range from salt mining to software engineering, has been gradually expanding in the UK, where it owns the Tetley tea brand, and it is now the world’s fifth-largest steelmaker after buying Corus. Jaguar and Land Rover together employ 15,000 in Britain. It is understood that Tata plans to retain all three of the UK factories, at Solihull and Castle Bromwich in the Midlands and Halewood on Merseyside.

Ford sold Aston Martin earlier this year. The company is struggling to return to profitability after record $12.7 billion (£6.3 billion) losses last year. Tata’s image as a mass-market supplier took a knock at the beginning of the year during protracted negotiations over land for its small car plant in West Bengal, which ended in violence. (source: Timesonline) - Acer & Tata in today's news

Northern Rock dreams fading

2007-12-14T00:57:00.000-08:00

There are only two interested parties left in the dying dreams of Northern Rock - Sir Richard Branson's Virgin Group and Olivant, the firm led by former Abbey National banker Luqman Arnold. Even that might be over optimistic as Olivant wants to bypass the formal process, which has a February deadline. It wants its executives in place by Christmas and thinks delay would further damage Northern Rock.

Olivant's interest is fading, and it was probably no coincidence that Adam Applegarth, the Rock's chief executive, was pushed out very early yesterday. His departure was an admission that Olivant is right about one thing: it is time to get real. It is also time to drop the pretence that this is an auction. Nobody has ever proposed buying Northern Rock with all its assets and all its liabilities. It has been a competition to see who could best safeguard taxpayers' money.

Solutions to Northern Rock – Olivant’s proposal is to repay £10 billion to £15 billion of the £25 billion immediately and this gap between the figures illustrates the degree of wishful thinking running through the plan. The Virgin solution - on the sketchy public details - doesn't sound much better. Its management has no experience of running a bank with a £110 billion mortgage book, and the Virgin name has made little impact on the financial services industry in 10 years of trying. When the taxpayer is on the hook for £25 billion, those facts can't be ignored.

Things actually got worse last night and The Virgin Group was stripped of its preferred bidder status in the battle for Northern Rock after rival Olivant threatened to walk away unless it was put on an equal footing with Sir Richard Branson’s company. Northern Rock agreed to the measure at a meeting with representatives of the Treasury, the Bank of England, the Financial Services Authority and the bidding consortium, which is led by Luqman Arnold, the former chief executive of Abbey. In exchange, Olivant agreed to remain in the auction until at least mid-January.

In a preclose statement yesterday, the Rock unveiled a £281 million write-down on sub-prime mortgage investments, including a £118 million hit on structured investment vehicles (SIVs) and a further £32 million from higher-risk SIV-lites. It did not change its September forecast of underlying pretax profits in 2007 of between £500 million and £540 million.

Meanwhile, Andy Kuipers, Northern Rock’s sales and marketing director, yesterday replaced chief executive Adam Applegarth with immediate effect but the move failed to comfort shareholders, who saw the bank’s stock plunge more than 13%. (source: Guardian & Timesonline) - New Bid for Northern Rock by Olivant, Northern Rock offers below value, Final bids for Northern Rock today, New player in Northern Rock bid, Virgin pushes forward in takeover, BAA must halve queueing times to avoid fines, SAB Miller to buy Royal Grolsch, BHP Billiton's offer rejected, News Corporation on taking over Dow Jones

The Controversial Sports Direct founder and Newcastle United football club owner, Mike Ashley, faces a legal threat to his attempt to acquire Les Ambassadeurs, the London casino.
Although Mr Ashley’s estimated £95 million offer is believed to be the highest bid on the table, it is understood that Las Vegas Sands, the American gaming behemoth, is claiming it had previously agreed a deal at about £75 million, and the owner of Las Vegas Sands and one of the world’s richest men (£13 billion) is threatening to sue. The reason for sueing is because Mr Sheldon Adelson was understood to be the original bidder at £75 million.

Mr Adelson is also believed to have contacted rival bidders through his lawyers, Mishcon de Reya, claiming he has a binding verbal agreement to buy Les Ambassadeurs and threatening legal action against them if they attempt to gazump him.

In the early stages of the sale process analysts were tipping Harrah’s Entertainment, another Las Vegas gaming giant and the owner of LCI, the casino’s former owner. However, Harrah’s is itself the subject of a recommended $27.8 billion (£13.9 billion) takeover by Apollo Management and TPG Capital, and the buyout firms are said to have vetoed a purchase of Les A in the light of tough trading conditions in the UK.

Las Vegas Sands is believed to view Les Ambassadeurs as a strong brand that could be rolled out as part of Mr Adelson’s ambitious expansion plans. In addition to the Venetian Resort Hotel Casino and the Sands Expo and Convention Center in Las Vegas, it runs the Venetian Macao Resort Hotel and the Sands Macao.

Las Vegas Sands declined to make any comment, while Mr Ashley could not be reached for comment. (source: Timesonline) - Alitalia SpA in sight for Air France-KLM, Sports Direct to block Nike takeover

ArcelorMittal to by China Oriental Group Co.

2007-12-13T02:03:00.000-08:00

The world’s largest steelmaker, ArcelorMittal, agreed to take over China Oriental Group Co. to gain a foothold in the fastest-growing steel market, valuing the company at a minimum of HK$18.6 billion ($2.4 billion or £1.2 billion). ArcelorMittal offered at least HK$6.355 for all the China Oriental shares it doesn't already own and said it plans to raise its stake to 73.13% from 28%.

The takeover may allow Chief Executive Officer of ArcelorMittal, Lakshmi Mittal, to bypass laws that restrict overseas control of steelmakers in an economy that expanded more than 11% in the first three quarters of the year. China has accounted for 65% of global growth in steel production in the past 10 years, and is now four times the size of the U.S. steel industry.

``Strengthening our position in the fast-growing Chinese market is one of the important elements in ArcelorMittal's strategy,'' Mittal said today. “We plan to develop China Oriental into a leading producer of heavy sections, focusing on leadership, quality and sustainability.''

Mittal is however still waiting for approval of his 2006 accord to buy a 38% stake in state-owned Laiwu Steel Corp., after the Chinese government last year tightened scrutiny of acquisitions by overseas companies. ArcelorMittal already holds about 29% stake in Hunan Valin Steel Tube and Wire Co. and has 12% of a Shanghai- based venture with Nippon Steel Corp. and Baoshan Iron & Steel Co. that supplies sheets to the automotive industry.

Hong Kong-listed China Oriental makes billets and strips, producing more than 3 million tons of crude steel a year. It posted a 769 million yuan ($104 million) profit from sales of 6.65 billion yuan for the six months ended June 2007. China Oriental will resume trading in Hong Kong at 2:30 p.m. local time after being suspended since Nov. 7, when they closed at HK$5.40. (source: Bloomsberg) - Merger would not affect ArcelorMittal

The internet search engine, Microsoft, has agreed to buy the privately owned British company, Multimap. Multimap is snapping at the heels of Google, the dominant online mapping service. The deal, understood to be worth slightly above $50 million (£24.4 million) and will further expand Microsoft’s fast-growing footprint in online and mobile advertising.

It will also deliver a $25 million (£12.5 million) windfall to Sean Phelan, the Multimap founder, who owned a majority stake in the business that he founded 12 years ago. Multimap’s 120 staff will share a further $13 million (£6.5 million), with an unnamed angel investor who holds the remaining 25% receiving a similar amount.

Multimap’s consumer-orientated website attracted more than four million unique users in the UK last month. It placed the site second in the British rankings, sandwiched between the market-leading Google Maps, which attracted about 11 million users last month, and Google Earth.

Multimap also operates in the commercial market, where it supplies online maps for websites run by other businesses. Clients include Ford and Royal Mail. The business-to-business service traditionally has delivered the lion’s share of Multimap’s revenues, but the consumer site is growing more quickly, Mr Phelan said.

The company is expected to post revenues of about £12 million this year. It made profits of nearly £900,000 in 2006. (source: Timesonline)

Air One was expected to be named at the preferred bidder for Alitalia by The Italian Government last night. Air One, owned by Carlo Toto, the Italian entrepreneur, faced competition from Air France-KLM. Air One was said to be the preferred bidder partly because it offered an “Italian solution” and partly because Air France-KLM wanted to downsize Milan Malpensa Airport.

Mr Toto said, “Obviously, some think that the Italian solution is the best right now”. However, Anpac, the pilots’ union, said that Air One’s business plan offered “no real European integration for the future Alitalia.”

AP Holding, the parent company of Air One, said that it had the support of four banks – Intesa Sanpaolo, Nomura, Morgan Stanley and Goldman Sachs. Reports said that AP Holding was ready to buy the Government’s 49.9% stake in Alitalia and try to buy out minority shareholders. Air One had guaranteed that it would maintain Alitalia’s two national hubs, at Rome and Milan, and up-grade international routes, with 90 new aircraft for short and medium-haul flights and 20 for long-haul services. It also planned to cut 2,750 jobs in a staff of 19,000. Air France-KLM said that it would cut jobs if its bid was successful.

Alitalia, which has been hit by strikes over restructuring plans and loses €1 million (£719,000) a day, has been trying to find a buyer for nearly a year. Maurizio Prato, the chairman, has indicated that he favours the Air France-KLM offer, but union leaders said that “if Alitalia were to go to a foreign company we would, in effect, be the only big European country not to have a flag carrier”. (source: Timesonline) - Alitalia SpA in sight for Air France-KLM

2007-12-12T02:19:00.000-08:00

As reported a couple of weeks ago in the entrepreneur, BHP Billiton Ltd., the world's biggest mining company, is finally studying the next steps in its takeover approach for Rio Tinto Group, which continues to reject talks on the $137 billion (£68.5 billion) proposal. Rio Tinto Group is the world's third-largest mining company and asked U.K. regulators yesterday to force BHP Billiton Ltd. to formalize its position. BHP Billiton Ltd. wants to create a company that would be the biggest producer of energy coal, copper and aluminium.

BHP Billiton Ltd is under pressure to increase its offer. Perennial Investment Partners Ltd., Argo Investments Ltd. and Baker Steel Capital Managers LLP say the three-for-one stock offer is too low. BHP Billiton Ltd needs to come back with an offer of 3.9 shares for every Rio share to get Rio to engage. BHP Billiton Ltd’s CEO, Marius Klopper (pictured) said in a speech for presentation to investors, ``We continue to believe that our proposal is compelling and in the interests of both sets of shareholders,'' (source: Bloomberg) - BHP Billiton's offer rejected

Pat Shanahan, Boeing's man on the hot seat offered customers yesterday and Wall Street the makings of a credible plan to keep the troubled 787 Dreamliner on track to meet its revised schedule.

But investors will have to fly on the faith of Shanahan's commendable record of fixing some of Boeing's most intractable problem programs. While offering insight into how he is making operational changes since the program schedule was reset in October, Shanahan, vice-president and general manager of the 787 program, and Boeing Commercial Airplane CEO Scott Carson offered few new details on the issues that matter the most to the 787's fate: namely, how to get from zero to six airplanes a month by 2009 and how exactly to prod some struggling suppliers such as Vought Aircraft to step up to the daunting challenge. Other key questions relate to weight reduction, aircraft certification, and suppliers being able to adapt quickly to engineering changes. (source: Business Week) - BP fined for a record amount (Article on Dreamliner delays)

Competition Commission’s Business and Enterprise Secretary, John Hutton, is expected to publish within the next week the Competition Commission’s conclusions from its inquiry into the legitimacy of BSkyB’s shareholding in ITV.

Mr Hutton can reject any penalty on Sky proposed by the commission, but is bound to accept the regulator’s in-principle findings — as long as they are purely on competition grounds. Yesterday, the commission inquiry team met to consider the case and will now finalise its report in the hope of delivering it to Mr Hutton this week.

The regulator is expected to repeat its provisional conclusion that Sky’s 17.9% ITV stake is too high and in breach of competition law. Mr Hutton then has up to 30 days before he publishes the commission’s report. Sky is 39.1% owned by News Corporation. The level to which the commission wants Sky to sell down is not clear and Sky has said that it was willing to put a 3.9% holding into an independent trust. (source: Timesonline) - Heathrow voted worst airport (article on BSkyB ITV shares)

Lemsip & Dettol brands sold to Reckitt Benckiser

2007-12-11T02:02:00.000-08:00

The owner of brands such as Lemsip and Dettol, Reckitt Benckiser, took its first steps into the US healthcare market yesterday by unveiling a £1.1 billion all-cash deal to buy Adams Respiratory Therapeutics, a Nasdaq-listed pharmaceutical company. Adams, markets two cough mixtures in the US, Mucinex and Delsym, which together generate annual sales of more than $322 million (£157 million).

Reckitt will pay $60 a share for the company, representing a 37% premium to Adams' closing price of $43.68 on Friday. It is the Anglo-Dutch group's second major acquisition in the over-the-counter pharmaceuticals sector in the past two years. Last year, the group bought Boots Healthcare International, which includes the Strepsils and Disprin cold remedy brands, for £1.93 billion.

Mr Becht, chief executive, said the deal would be immediately earnings enhancing, adding that the group expects to achieve "substantial" cost synergies from the acquisition, although there would be a one-off restructuring charge of $60 million. (source: The Independent)

Reuters is in discussion with The New York Times about supplying business news to the American newspaper, after reaching a similar agreement with its sister title the International Herald Tribune .

The tie-ups are designed to augment both titles’ business coverage, in an attempt to fend off the competitive threat from The Wall Street Journal , which is due to be acquired by News Corporation this week.

From January, the International Herald Tribune will feature five or six pages of business coverage under the brand Business with Reuters and part of the newspaper’s website will be co-branded.

Rupert Murdoch, the chairman and chief executive of News Corporation, plans to broaden The Wall Street Journal’ s focus so that it better competes with The New York Times on its home turf, and to invest in its international editions to compete with the International Herald Tribune abroad. (source: Timesonline)

Alfred McAlpine to be sold

2007-12-10T03:43:00.000-08:00

Alfred McAlpine is to be sold to Britain’s second biggest construction company, Carillion, for £572 million to create one of Britain’s biggest support services and construction companies. It is understood that Carillion will pay 558p per share for London-based McAlpine.The offer was down from its previously agreed 585p a share proposal. News of the deal sent McAlpine shares up 27p to 518p, while Carillion shares were down 22.25p to 341.25p at 9.15am.

The purchase, which creates a company with annual sales of about £4.7 billion, will give Carillion direct access to raw materials used in construction and generate annual savings of £30 million. The deal will also boost Carillion’s position in other support services, adding McAlpine's strength in financial services and retail to its existing focus on education, health, defence, transport infrastructure, telecommunications and insurance.

Carillion said it had already received favourable responses from McAlpine directors and investors representing 17.9% of the issued shares in the company. In August, McAlpine announced plans to split into two listed companies, effectively demerging support services from its construction activities, which it planned to complete during the spring of next year.

McAlpine had previously rejected two approaches from Carillion, one in October priced at 570p per share and the other in August at 560p. It rebuffed both proposals because it said it believed they materially undervalued the company. (source: Timesonline)

Drawing up this year’s list for businessman of the year has provoked a furious debate among The Sunday Times business staff, and there were verbal fisticuffs over the omission of, for example, Emilio Botin, chairman of Banco Santander, the fast-growing Spanish bank. This has been the year when the gift of perfect timing has separated the great from the merely good. Our finalists have demonstrated the knack of putting themselves, and their organisations, in the right place at the right time.

Botin got the best of the biggest financial-services deal of all time, when a consortium led by Royal Bank of Scotland bought ABN Amro, the Dutch bank, for €71 billion (£51 billion). While Botin was a junior partner in the consortium, he managed to sell on ABN’s Italian assets for a tidy €2 billion profit.

Sergio Marchionne, leader of the remarkable turnaround at Fiat, was a contender, as was Katsuaki Watanabe, president of Toyota, which is on the brink of overtaking General M as the world’s No 1 carmaker.

John McAdam, chief executive of ICI, who was a finalist last year, only narrowly missed out again for doing a great job in selling the chemicals group to Dutch rival Akzo Nobel.

The Times now invite you to have your say. Please e-mail them at businessperson2007@sunday-times.co.uk and let them know what you think. Your opinions will help the judges choose from an impressive field.

Lloyd Blankfein, GOLDMAN SACHS
The Goldman Sachs chief executive grew up in a tough Brooklyn neighbourhood and won a scholarship to study law at Harvard. When he joined the famed investment bank, he wondered how he would ever survive. But survive he did, and prospered, reinventing himself and becoming one of the key architects of the bank’s own reinvention.

Goldman has moved from a firm that made money by giving advice on deals, to doing deals itself. And it called the credit crunch better than rivals, paring back sub-prime exposure early in the year and hedging most of what remained.

Clive Cowdery, RESOLUTION
This year saw the battle of the “zombie” funds – pools of life-insurance funds that have stopped to write new business, but live on to service current policy-holders.

The big winner was Clive Cowdery, founder and chairman of Resolution, one of the first and largest of the zombie players, who will walk away with £151m after selling the group to rival Pearl.

Less than four years ago, Cowdery had the vision to set up Resolution with £500,000 of his own money. The firm pulled off a number of deals, then merged with Britannic and embarked on a frenzy of ever-bigger transactions, becoming a FTSE 100 company worth £5 billion.

This year he proved a pragmatic dealmaker. Having agreed a merger with Friends Provident, he flushed out Standard Life and then Pearl, netting another £200m for shareholders.

Clara Furse, LONDON STOCK EXCHANGE
This will be the first Christmas in three years that Clara Furse, chief executive of the London Stock Exchange, has not spent in the heat of a takeover battle.

She has made a name for herself in the City for saying no. Over the past two years, she has seen off approaches ranging from Australia’s Macquarie and Germany’s Deutsche Börse to America’s Nasdaq.

But that in itself does not make her a candidate. What does is her nimble-footedness in ensuring that despite the multiple takeover distractions, the LSE has enhanced its reputation as a global centre for equity fundraising.

With the acquisition of Italy’s Borsa Italiana, Furse has retaken the initiative and if she does want to pursue further tie-ups with other exchanges, it will now be of her own volition.

Chris Hohn, TCI
When Chris Hohn, who heads the TCI fund, blocked Deutsche Börse’s bid for the London Stock Exchange last year, he was dubbed a “locust” by the German establishment. But even his admirers were stunned by his target this year: ABN Amro, the pillar of the Dutch establishment.
In February, Hohn dropped a letter to ABN’s chairman dissecting the bank’s failings, lambasting its “terrible” shareholder return and demanding the bank break itself up or sell itself. While the Dutch establishment spluttered, the letter kick-started the biggest financial-services takeover battle of all time.

Steve Jobs, APPLE
The Apple boss won three years ago, and he is back in the running again, despite some opposition. “You can’t put Jobs in,” moaned one member of the business team. “The iPhone isn’t the iPod.”

There are a lot of customers who would beg to differ.

Jobs makes the final 10 because the iPhone, a device that incorporates a mobile phone, music player, web browser and personal organiser, represents the fifth major industry (personal computing, desktop publishing, film animation, and music retailing were the four before mobile phones) he has shaken up in a remarkable business career.

This fact is pointed out in this month’s Fortune magazine, which makes Jobs No 1 in its annual list of the most powerful business people in the world.

Finian O’Sullivan, BURREN ENERGY
Burren Energy began 12 years ago in O’Sullivan’s garage in Hampshire. Ten days ago it agreed a £1.7 billion takeover by Eni, the Italian oil group, with the possibility of a higher counter-offer from KNOC, South Korea’s national oil company still to come.

This rapid accumulation of wealth was based on O’Sulli-van’s willingness to go where others would not – resource-rich but uncomfortable places like the Democratic Republic of Congo and Turkmenistan.

John Paulson, PAULSON & CO
The sub-prime crisis brought financial hardship and woe to most major financial institutions, but success and a fabulous pay-day to hedge-fund managers like John Paulson, who runs Paulson & Co from offices in Madison Avenue, Manhattan.

Last year Paulson told investors he thought the American sub-prime mortgage market was going to crash, and raised $2 billion for two funds that would bet that way. By the end of September, the two funds were worth $8 billion.

It is estimated that his firm’s reward for such confidence will eventually be between $2 billion and $4 billion, making him the highest paid hedge-fund manager in history.

Ratan Tata, TATA
The head of one of India’s largest and oldest business empires had a breakthough year in his bid to go global. He paid $6.7 billion to win control of Corus, the Anglo-Dutch steel group that contains the rump of British Steel.

The deal made Tata Steel an international force, and demonstrated to the world that Ratan Tata was prepared to be aggressive in his move offshore.

Next on the radar are Jaguar and Land Rover, the British car marques, for which Tata Motor is the leading bidder.

Willie Walsh, BRITISH AIRWAYS
The chief executive of British Airways has a lower profile than his predecessor, the charismatic Sir Rod Eddington, but has tackled the difficult issues that have dogged the airline for years.

The biggest of these was the company’s hefty pension deficit, which has (hopefully) been dealt with through a funding deal laboriously hammered out with trustees and unions.

Walsh has also confronted some of the company’s old-fash-ioned working practices in the run-up to a move next year to a new base at Heathrow.

BA now has a fair chance of meeting its long-held goal of a 10% profit margin, and Walsh is even looking at growth, with a big new aircraft order, expansion at London City airport anda plan to launch transatlantic services from the Continent.

Wendelin Wiedeking, PORSCHE
This year Wiedeking, Porsche’s maverick boss, will earn about €70m, making him probably the best-paid industrial executive in the world.

His remuneration has sparked political controversy in Germany, but you can’t deny he is being rewarded for success. Not only has Porsche brilliantly widened its niche sportscar market, with sales growing from 12,000 a year 15 years ago to 100,000 now, but it has increased earnings by taking a large hedge bet on the weakening dollar.

What’s more, as a result of a power play executed against the backdrop of manoeuvring between two of Germany’s most famous industrial families, the Porsches and the Piechs, Porsche is now poised to take majority ownership of Volkswagen, a much larger car company and possibly the only one with a realistic chance of challenging Toyota’s dominance.

PREVIOUS WINNERS
2006 Lakshmi Mittal, chief executive of Arcelor Mittal
2005 Sergey Brin and Larry Page, the founders of Google
2004 Steve Jobs, chief executive of Apple
2003 Sir Ken Morrison, chairman of Wm Morrison
2002 Eliot Spitzer, New York attorney-general

News Corporation on taking over Dow Jones

2007-12-07T04:07:00.000-08:00

With a week to go before the News Corporation, owned by media mogul Rupert Murdoch, takes control of Dow Jones & Company, there are already management changes under way at the top of Dow Jones. Richard F. Zannino, Dow Jones’s chief executive, will leave the company after staying for a time to help with the transition, to be succeeded by Les Hilton, executive chairman of News International. News International includes News Corporation’s British newspapers: The Times of London, The Sunday Times, The News of the World and The Sun.

Executives at both companies say there will be a broader sweep of the upper echelon at Dow Jones in the next few weeks, both to eliminate duplication and to make way for Mr. Murdoch’s people. Mr. Zannino’s departure was announced by the company yesterday, a week ahead of the shareholder vote that is expected to seal the deal. He will stay on through a transition period.

Mr. Zannino said the choice to leave was his; others at Dow Jones were divided as to whether that was so, while some said the decision was mutual. Mr. Murdoch has a history of putting his loyalists atop newly acquired operations. Mr. Zannino is also in line for a financial windfall when he leaves, under a change-of-control provision Dow Jones adopted last summer. His exit package is worth more than $26 million (£13 million), including $3.4 million (£1.7 million) in severance pay and nearly $7 million (£3.5 million) in shares, according to estimates from James F. Reda & Associates, a consulting firm.

Mr. Zannino, 49, who became chief executive almost two years ago, is widely credited with making Dow Jones run more efficiently, and he led a shift toward electronic media and away from ink and paper. Under him, Dow Jones bought MarketWatch.com and the half of the Factiva archive service that it did not already own, and sold several small newspapers. News Corp is acquiring Dow Jones for about $5 billion (£2.5 billion) in a deal that is expected to close next week.

In an interview yesterday, Mr. Zannino said his legacy would be “getting us all to think like a media company rather than a newspaper company; viewing The Wall Street Journal as a franchise, as opposed to a newspaper.” (source: The New York Times) - New Bid for Northern Rock by Olivant

News Corporation has confirmed that James Murdoch, the chief executive of BSkyB, has been appointed as its new chairman and chief executive for Europe and Asia. Mr Murdoch will step down from his role as chief executive at BSkyB but will become non-executive chairman and succeed his father, Rupert Murdoch, who has stepped down as a director of the broadcasting group.

He will report to Peter Chernin, president and chief operating officer of News Corporation.
James Murdoch will be replaced by Jeremy Darroch, who is the chief financial officer of BSkyB. Sky is 39.1% owned by News Corporation. Commenting on the appointment, Rupert Murdoch, chairman and chief executive of News Corporation, said: "James is a talented and proven executive with a rare blend of international perspective and deep, hands-on experience in improving operational results. This is the right time to align our operations in Europe and Asia under new, structured group leadership."

The decision to move Mr Murdoch, who will become chairman of News Corporation’s European and Asian businesses, clearly positions the 34-year-old as the most likely successor to his father's leading roles at News Corporation, the media group that also owns the MySpace website and the Fox film studio.

James Murdoch, who was previously a member of News Corp's board between 2000 and 2003, said today: "I am excited to be rejoining News Corporation in this new role leading News Corporation's businesses across Europe and Asia, and I am delighted to continue working with the exceptional team at Sky in my new role as Non-Executive Chairman and as a Director." (source: Timesonline) - BSkyB buys Amstrad

RAB Capital, one of Northern Rock's largest shareholders, has confirmed it is backing Olivant's rescue bid for the stricken bank. Luqman Arnold's Olivant Advisors today said it has received non-binding letters of commitment from five institutional Northern Rock shareholders, who own 23% of the stricken bank, casting doubt on the future of Virgin Money's rescue offer. RAB, holder of 6.6% of Northern Rock, has confirmed it is supporting the former Abbey National chief executive's bid.

SRM Global, the largest shareholder in Northern Rock with over 9%, was unavailable to comment on whether it was backing Olivant's bid as Olivant has unveiled its proposal on the deadline for submitting bids to acquire the troubled mortgage lender which yesterday admitted for the first time that it has borrowed £25 billion worth of emergency funding from the Bank of England.

It also emerged last night that JC Flowers, which had been a serious contender to rescue Northern Rock, has pulled out of the race because it was unable to structure a deal that could both the Government and shareholders happy.

Olivant's proposal includes raising funds of up to £650 million through a rights issue. In contrast, Olivant said today it would issue the shares "at or around" the prevailing market price. Shares in Northern Rock hovered around the £1 mark again today after falling 1.46% to 101.5p. Richard Branson's Virgin Money, which is Northern Rock's preferred bidder, is also proposing raising £650 million through a rights issue but at a heavily discounted 25p.

Olivant said Northern Rock's total £25 billion in debt would be repaid to the Bank of England by the end of 2009 "through active operational management, accelerated through external market financing". The investment group said £10 billion to £15 billion of the £25 billion debt would be repaid after completion of the rights issue.

Olivant also confirmed it would retain the Northern Rock brand and that Mr Arnold be parachuted in to become Northern Rock’s executive chairman, with Kirk Stephenson, Olivant’s chief operating officer, taking up a role as a non-executive director at the bank. Virgin has indicated that they will change the Northern Rock name to Virgin. (source: Timesonline) - New Bid for Northern Rock by Olivant, Northern Rock offers below value, Final bids for Northern Rock today, New player in Northern Rock bid, Virgin pushes forward in takeover, BAA must halve queueing times to avoid fines, SAB Miller to buy Royal Grolsch, BHP Billiton's offer rejected

Alitalia SpA in sight for Air France-KLM

2007-12-06T04:07:00.000-08:00

Alitalia SpA is said to be in sight for the world’s biggest airline, Air France-KLM Group, as it will try and revive the unprofitable carrier that the Italian government is trying to sell. Air France is one of three candidates to buy Alitalia, the Paris-based company said in a statement today. Deutsche Lufthansa AG of Germany and Italy's Air One may also present offers before today's deadline. Rome-based Alitalia will select a partner for exclusive talks by the end of the month.

Alitalia hasn't reported an operating profit in nine years and is losing more than 1 million euros ($1.5 million) a day. ``No one is going to pay a premium for Alitalia,'' said Gianmaria Bergantino, head of asset management at Bank Insinger de Beaufort NV in Rome, who owns Alitalia convertible bonds. ``Whoever buys it is buying it for its airport slots.'' He spoke before the announcement was made.

Air France-KLM has sent a non-binding expression of interest, it said today's statement. The company already owns about 2% of Alitalia, which was initially slated to join the 2004 merger between the French and Dutch airlines. The Italian carrier was excluded because of mounting losses. (source: Bloomsberg)

Despite trying for months to find a new non-executive chairman for Sports Direct is still looking for this corporate vacancy that is proving impossible to fill. The role would hand the lucky candidate a competitive salary and a once-in-a-life-time opportunity to etch their name in the City’s memory for years to come. Senior headhunters said yesterday that the task could prove extremely difficult, given the challenge of working alongside Mike Ashley, the tycoon who founded the business with one shop in 1982.

Rivals also point to another looming problem – the state of its Sports World and Lillywhites stores. John David Group said on Tuesday that it believed shoppers were getting “tired” of the discount approach taken by Sports Direct, which has made its name on the back of a “pile ’em high, sell ’em cheap” strategy.

Shares in Sports Direct have plunged since listing in March at 300p in a float that handed Mr Ashley a £929 million windfall. A profit warning last month pushed the stock to a new low of only 93.25p. Yesterday they closed at 100p. Despite his vast experience as a retailer, Mr Ashley has admitted that he was “very green” when he floated the business and that he found being in charge of a public company “challenging”.

Analysts believe that Mr Ashley could soon buy the business back. He has a near 68% stake and Sports Direct will ask investors for the right to buy back more shares at an extraordinary general meeting in two weeks. (source: Timesonline)

PepsiCo is set to deal a blow to Apple’s dominance of online music and the music labels’ best efforts to fight piracy. Pepsi is preparing a year-long marketing campaign in the United States in which up to a billion digital music tracks will be given away. Based on the prices charged by Apple, the largest online music retailer, the offer could be worth up to $1 billion (£490 million).

Crucially, the drinks group is believed to be teaming up with Amazon.com, the online retailer vying with Apple’s iTunes music store, to distribute the giveaway tracks. It is also thought that the music will be distributed free of the digital rights management (DRM) technology that limits where legitimately downloaded tracks can be played.

There is speculation that PepsiCo’s huge distribution of DRM-free music could compel other labels, such as Warner Music and Sony BMG, to use the format. This year Steve Jobs, the chief executive of Apple, said that he would drop DRM “in a heartbeat”, but claimed to have had his hands tied by the labels.

Pepsi’s promotion – the latest shot in its long battle with Coca-Cola – is to start in February, in concert with the Super Bowl, one of the biggest advertising magnets in the world. It echoes a giveaway in 2003, in which Apple and Pepsi offered 100 million free tracks Amazon’s music ambitions need a boost. Since it began its download service in September, it has captured an estimated 3% of the market. By contrast, Apple accounts for about 80% and in July said that it had sold more than three billion songs.

PepsiCo is planning to place tokens on five billion drink containers. Consumers will have to collect five tokens to qualify for free tracks. In theory, the campaign could flood the market with $1 billion of free music (Apple charges 99% per DRM-free track), but redemption rates on these types of offers are usually low, at about 2%.

Despite Apple’s success, online music sales still account for only a tenth of the total market and are not yet growing at a rate to compensate for the decline in revenues from CDs – sales of which have fallen by about a fifth in America this year. (source: Timesonline)

New Bid for Northern Rock by Olivant

2007-12-05T01:39:00.000-08:00

The former Abbey chief executive consortium (Olivant) led by Luqman Arnold, is expected to table a revised bid for Northern Rock by the end of tomorrow. It is understood that Olivant is to be in talks with both Northern Rock and potential funding banks as it hammers out the final details of its offer. This comes after revised bids from JC Flowers and Cerberus, the American private equity firms, despite Virgin Group winning preferred-bidder status in the auction of the troubled Newcastle-based bank.

The bank was forced to seek emergency funding from the Bank of England after it failed to raise cash in the wholesale markets as a result of the credit crunch. Meanwhile, staff at Northern Rock have been handed a £200 Christmas bonus and are also understood to have received a 2% one-off sum and 4% salary increase.

Shares in Northern Rock closed down 6p at 103p yesterday. (source: Timesonline)

News Corporation, parent company of The Times, bought the leading American religious website Beliefnet yesterday for an undisclosed amount in an effort to tap the faith market in a country where 88% of the population say that they pray regularly.

Beliefnet, formed eight years ago, attracts 3.1 million monthly users. It was sold by its founder Steve Waldman, who wanted to find a big media company willing to provide investment that the standalone business could not afford.

News Corp is perhaps best-known for its newspapers, with titles such as The Sun and the New York Post, and mass entertainment through the 20th Century Fox film studio. However, the media group also owns a handful of faith-based businesses, including Zondervan, the largest Christian publisher in the United States, and Fox Faith, which makes faith-based films.

Appealing to a Christian audience is big business in the United States, where films such as Walt Disney’s The Lion, The Witch and The Wardrobe are marketed, at least partly, at a Christian audience. Mel Gibson’s 2004 film The Passion of Christ earned $611 million (£295 million) worldwide despite an uncompromising narrative, of which $370 million (£135 million) was taken in the United States.

The website will be absorbed into News Corp’s Fox Entertainment Group, owner of the Hollywood film studio, rather than its Fox Interactive Media division, which is the group that includes MySpace, the social networking website. (source: Timesonline)

Founder of the five-year old Nectar card programme, Sir Keith Mills, set himself up for a £161m payday yesterday after agreeing to sell the customer loyalty company he started. Aeroplan, operator of Air Canada's frequent-flier programme, agreed to pay £350 million ($700 million) in cash for Loyalty Management Group, in which Sir Keith holds a 46% stake. Most of the company's management, including the chief executive Alex Moorhead, will stay at LMG, though Sir Keith will step down as chairman.

Warburg Pincus, the private equity firm that granted £25 million ($50 million) in start-up funding for the business five years ago, will pocket about £117 million for its one-third stake, with the remainder going to certain top managers who held the balance of the private company's shares.

Nectar runs loyalty programmes with partners including J Sainsbury, BP, Barclaycard, and Debenhams. (source: The Independent)

Ambramovich to acquire 40% of Highland Gold

2007-12-04T05:50:00.000-08:00

Russia’s richest main, Mr Roman Abramovich, will acquire a 40% interest in Highland Gold Mining Ltd for $400 million (£200 million) by subscribing to a new share issue in Russia's fourth-largest gold miner. Highland Gold, which produced 3.2% of Russia's gold last year, has seen its London-listed stock plummet to a record low this year after falling short of production targets and the disposal of a mine where 25 people died in a fire in 2006.

The financial and political clout of the billionaire helping Highland Gold Mining Ltd to fulfill expansion plans and acquire more assets in Russia has helped Highland's stock rose on Tuesday to its highest in over seven months. Gold prices hit a 28-year high last month as oil rose toward the $100 (£50) milestone and the dollar sank to record lows against the Euro. Russia has gold reserves second only to South Africa's, but ranks only sixth in terms of output. (The Guardian)

The world’s biggest Finland-based mobile handset maker, Nokia, is set to go head-to-head with iTunes to offer free music downloads to buyers of its new music phones. Nokia has announced a deal with Universal Music to provide the label's releases, and aims to ship more than 180 million music-enabled phones in 2008.

The company's intention to expand into music will be of concern to Apple, which dominates the digital music market with its iTunes online download store. Nokia’s executive vice-president and general manager for multimedia, Mr Anssi Vanjoki said: "Even if you listened to music 24 hours a day, seven days a week, you would still only scratch the surface of the music that we're making available," The company added that it was in discussions with a number of other record labels regarding the use of their material.

Meanwhile, at its annual investor day Nokia forecast that the overall market for mobile phone sales would grow by around 10 per cent next year. Last week the world's number two mobile maker, Samsung Electronics, estimated market growth of 12%. Nokia added that it expects margins of 20% from its phones and services business over the next couple of years and aims to increase market share.

Shares in Nokia fell around 4% on the margins announcement, with investors expecting a more positive forecast from its key business. (source: Timesonline)

De Beers sold historic Cullinan Mine

2007-11-23T02:51:00.000-08:00

The world’s biggest diamond producer, De Beers (45% owned by Anglo American), said yesterday it had sold its historic Cullinan mine to the Petra Diamonds Cullinan Consortium (PDCC), consisting of Petra and Saudi investment firm Al Rajhi Holdings for R1 billion (£71 million) in cash. The PDCC consortium will each buy 37% stakes, with black-owned Thembinkosi Mining Investments getting 26%. De Beers Managing Director, Gareth Penny said “PDCC emerged as best bidder in a long selection process.”

Asked how the transaction would be funded, Penny said the money had been raised through a special purpose vehicle. The deal is expected to be concluded in April or June, depending on Competition Commission approval and the successful conversion of De Beers's mining right from old order to new order, and the transfer of that mining right to Petra and Thembinkosi.

The deal brought a major resource to the group. The sale was in the economy's interests as Cullinan mining would continue. The new players have studied Cullinan's cost structure and they have a plan in place to turn it around, it is understood. The 3106-carat Cullinan Diamond was found at the mine. This is the third mine De Beers has sold to Petra, regarding them as unprofitable; the others were the Koffiefontein and Kimberley underground mines. In the year to December, De Beers produced 1,15-million carats at Cullinan, with a market value of R505 million (£36 million). (source: Business Day)

TomorrowNow, the SAP unit at the centre of corporate spying scandal, is being eyed by US-based provider of software support, Rimini Street. Chief Executive of Rimini Street, Seth Raving, said “we are interested, but we are proceeding cautiously and need to analyse it first." AP, the German software group, revealed at the beginning of the week that it was exploring options for the troubled unit, including selling it.

Mr Ravin was among the founders of the Texas-based TomorrowNow and sold the company to SAP almost three years ago. He declined to say whether talks were going on with SAP. Oracle, SAP’s arch-rival, filed a lawsuit earlier this year accusing SAP or corporate espionage. In the wake of the scandal, TomorrowNow's chief executive and several senior member of management resigned on Monday.

SAP is under pressure to announce a swift solution for TomorrowNow in order to avoid further damage to its image. Mr Ravin said “Since SAP's announcement, Rimini Street had received a dozen enquiries from TomorrowNow customers, exploring a possible transition.” Customers were uncertain since SAP had not been clear about "what they are doing with TomorrowNow," he added. (source: msnbc)

Airbus is under life-threatening circumstances as the weakness of the dollar is threatening the survival of the European planemaker. Airbus chief executive Tom Enders has told employees in Germany, “the dollar’s rapid decline is life-threatening for Airbus. The dollar exchange rate has gone beyond the pain barrier.”

Mr Enders made the claim as he gave warning that European production plants would have to face major cost cuts to help them counter the impact of the currency. The calls from the head of Europe's biggest manufacturer will increase the pressure on European ministers and the European Central Bank to take action against the continually weakening dollar.

The weak dollar is favouring Airbus's arch rival Boeing, the company claimed. The dollar hit a new low against the euro yesterday. In the year to date, the euro has gained about 12.5% against the US currency.

This gives Boeing a massive advantage over Airbus, which is struggling to win back the lead position in aeroplane sales from the American group after it was destabilised and pushed into losses by delays to production of the new aircraft. (source: Timesonline)

Silverjet gets new lifeline

2007-11-22T03:17:00.000-08:00

Silverjet, the business class only airline founded by Lawrence Hun, has secured a funding lifeline from a group of wealthy private investors including the billionaire property tycoons the Reuben brothers (Simon & David). The AIM-listed airline, flying from Luton to New York and also Dubai, postponed its results this week, triggering a wave of speculation over its future.

The Sunday Times has learned that the delay was to accommodate negotiations over a new funding package. The airline has raised £12 million from a placing of new shares, and £10 million in a loan from a company controlled by the Reubens. The loan can be converted to shares at a later date.

The Bombay-born Reuben brothers have amassed a fortune estimated at £2.5 billion, and are best known in the UK for a string of big property deals. Details of the deal are expected to be announced tomorrow when the company publishes its results.

Silverjet raised £25 million from a float in 2005 and in April this year it raised another £24.6 million by issuing new shares at a slight discount to the market price. Silverjet is likely to use the new funds to buy two new aircraft and expand services.

The business-class only airline has a luxurious private terminal at Luton, and flies 100-seat Boeing 767s twice a day to New York and daily to Dubai. (source: Timesonline)

The co-founder of Hotmail, the web-based e-mail service bought by Microsoft for $400 million a decade ago, is challenging the American software giant’s core $20 billion (£9.7 billion) office desktop business. Yesterday Sabeer Bhatia released a free online rival to the bestselling Office suite of applications that will allow users to view, share and edit documents from any computer.

The Indian-born Stanford graduate said that Live Documents would pose a “significant” challenge to Microsoft’s propriety software business, which eventually would be made redundant by the evolving internet applications industry. Office, bundling the Word word-processing, Excel spreadsheet and PowerPoint presentation tools, accounted for a third of Microsoft’s total revenues last year. It is forecast to top $20 billion (£9.7 billion) this year.

Mr Bhatia said “We are just a few years away from the end of the shrink-wrapped software business. By 2010, people will not be buying software. This is a significant challenge to a proportion of Microsoft’s revenues.”

Live Documents is similar to Google Apps, launched in February and used by companies including Proctor & Gamble, General Electric and Capgemini as a cheaper alternative to Microsoft. However, Mr Bhatia claims that his product is superior to Google’s in its range and quality, most crucially because it mimics Office 2007. Most of Office’s estimated 500 million customers have yet to upgrade from the 2003 version, while it is not available for Apple computers.

He said. “This will do for documents what Hotmail did for e-mail. Why spend $400 on an upgrade when you can get it for free?” Mr Bhatia and Jack Smith devised Hotmail, named after HTML, the language of the web, soon after leaving Apple in the mid1990s. Today it has more than 450 million users. (source: Timesonline)

BAA must halve queueing times to avoid fines

2007-11-21T03:49:00.000-08:00

The Civil Aviation Authority (CAA) has told BAA that they must halve queueing times at Heathrow and Gatwick or face annual fines of up to £75 million. In a move that would increase the financial pressure on Britain's largest airport operator, the new regime will add hundreds of millions to BAA's security bill. The CAA plans to punish the group if security queues are more than five minutes for 95% of the time, with a maximum queueing time of 10 minutes at Heathrow and 15 minutes at Gatwick. Harry Bush, the CAA's director of economic regulation, said the airports' performance this year would have triggered heavy fines under the new regime, due to come into force next April.

BAA has been fined £2 million this year for missing performance targets, including the current guideline that passengers should queue for no longer than 10 minutes in security areas. But it is not all bad news as the CAA is also offering a bonus of up to £32 million to BAA if it outperforms. Bush admitted that the airport owner would struggle to bring down queueing times sufficiently and said "these are quite difficult targets."

The CAA also outlined plans that could reduce BAA's annual cashflows by £150 million between 2008 and 2013. The regulator, which sets landing charges and the return on investment at BAA's largest airports, said it planned to cut the return on capital at Heathrow from 7.75% to 6.2% and at Gatwick from 7.75% to 6.5%. BAA said that would endanger projects such as the £3.5 billion redevelopment of Heathrow's central terminals and did not accommodate the cost of a tougher security regime.

Airlines criticised CAA proposals to increase landing charges at Heathrow by 15.6% to £11.97 a passenger, with annual price rises capped at 7.5% above inflation. British Airways, BAA's largest customer, said service standards could be improved without an "excessive" rise in landing charges. BAA has warned the regulator that the landing charges would not be high enough to compensate for the reduced return on capital. (source: The Guardian)

It appears as if there are fresh interest in Northern Rock as the ailing bank said it has received further "indicative expressions of interest" from firms which might be considering a buyout or investment. Northern Rock said that one interested party may make an offer for the bank below its closing share price of 97p on Tuesday.

On Tuesday, US buyout firm JC Flowers submitted a bid that included an offer to shareholders of a "nominal value". And a second bid emerged on Tuesday from American private equity firm Cerberus. Shares in Northern Rock were down 15% at 82.60p in early London trade today.

The Bank of England has lent the bank an estimated £24 billion in emergency funding, a move defended by Chancellor Alistair Darling in the Commons on Monday. Northern Rock, which has about 6 000 staff, is keen to secure the bank's future as soon as it can. In a statement it said: "The company's advisors have begun discussions with a number of selected interested parties to clarify their proposals. The bank said: "These guarantee arrangements will protect all retail deposits held with Northern Rock regardless of the amount deposited and apply to all existing, re-opened and new retail accounts". (source BBC News)

In the battle for Apple’s iPhone, Vodafone has claimed a partial victory in a legal challenge to block a German rival from selling Apple’s iPhone exclusively. The German unit of the British mobile giant secured a temporary injunction yesterday against T-Mobile Deutschland after claiming that its deal with Apple breached local competition laws.

Vodafone said that the German operator should be forced to make the phone available over other networks, including its own. Success by Vodafone could force Apple to rethink its controversial business model for the phone.

T-Mobile will release a statement today detailing its full response to the injunction, which was granted by a court in Hamburg. It intended to appeal against the decision and threatened to sue Vodafone for damages.

The iPhone, which has amassed more than one million sales in the United States, went on sale in Germany this month. Buyers must sign a two-year contract with T-Mobile and the phone cannot be used on other mobile networks.

T-Mobile said yesterday: “We have spent months thoroughly testing the iPhone to ensure it works properly on our network. Given the approach adopted by the competitor Vodafone, which lost out to T-Mobile in the contest to distribute the Apple iPhone in Germany, T-Mobile reserves the right to examine the option of suing for maximum damages.”

Despite a fierce battle in the UK, Vodafone lost out to O2 , and in France, to Orange. However, Apple’s approach has already been tested in France, where local laws have forced Orange to open up the phone to other networks.

German analysts said that they expected the operator to comply with Vodafone’s demands and stock “unlocked” iPhones, which work over other networks. However, the injunction does not force T-Mobile to take any immediate action. A full hearing is scheduled for two weeks’ time. (source: Timesonline)

SAB Miller to buy Royal Grolsch

2007-11-20T03:20:00.000-08:00

The world’s second largest brewer, SABMiller, has agreed to buy Royal Grolsch, the Dutch rival behind Grolsch lager. In its second major move on the international market in as many months, after agreeing to combine its American operations with those of Molson Coors, SABMiller is offering 48.25 euro per share, 84.3% above Grolsch's average closing price over the past month.

SABMiller, said that the management of Grolsch supported the offer, which values the Dutch company at 816 million euro (£582 million). As with earlier deals, SABMiller is paying a premium, offering almost 15 times the reported 2006 earnings before interest, tax, depreciation and amortisation.

SABMiller hopes to employ the Grolsch Premium Pilsner brand across Africa and Latin America, using it to tap into the lucrative premium segment of the market in those regions. In South Africa in particular, analysts expect the new member of the SABMiller family to help plug the gap after Heineken terminated SABMiller-subsidiary South African Breweries' licence to manufacture and distribute Amstel lager beer.

Yesterday's announcement also raised questions about SABMiller's position as a potential bidder for Scottish and Newcastle. Trevor Stirling, a beverages analyst at Sanford C. Bernstein, said “although I was almost certain SABMiller was interested in S&N, the balance of probability was against them making a bid. Scottish and Newcastle doesn't really have a well-known exportable brand like Grolsch. If SABMiller were to bid, it would be for the Russian assets and the 50% in BBH (Baltic Beverage Holdings)." (source: Google News)

Shares in Northern Rock plunged below £1 to an all-time low after Cerberus, the US private equity fund, walked away from making a rescue bid for the troubled mortgage lender as the market reacted to Chancellor Alistair Darling statement to the Commons yesterday. The Newcastle-based bank's shares fell 8 %t to 95.8p in early trading, valuing the group at £404 million. Just nine months ago, Northern Rock was valued at £5.2 billion when its shares reached a peak of £12.12 per share.

It emerged last night that Cerberus, one of four parties thought to be considering serious offers for the bank, has been put off making a concrete bid by continued turmoil in global financial markets. Its interest is also thought to have been affected by credit-related losses at GMAC, the former financing arm of General Motors that is now 51% owned by Cerberus. GMAC was expected to part-fund a Cerberus offer for Northern Rock.

The Government said yesterday that the line of credit that the Bank of England had extended to Northern Rock could not continue beyond February, because it would then contravene European rules on state aid.

Speaking before the Commons yesterday, Alistair Darling refused to give a guarantee that the £24 billion the Bank of England has so far lent Northern Rock will ever be fully repaid, leaving tax payers to foot the bill for the crisis. (source: Timesonline)

Luton Based low-cost airline, Easyjet, has seen annual pre-tax profits rise after carrying 37.2 million passengers in the year to 30 September. The Luton-based carrier said profits were up by 56% to £201.9 million ($431 million; 294 million euros), with its load factor, which shows how full flights are, at 84%.

In the past year Easyjet added eight destinations and 46 routes, bringing its network to 289 routes, using 77 airports in 21 countries. But it said rising oil prices meant the "fuel environment remains challenging".

Andy Harrison, Easyjet chief executive, said: "Despite challenging conditions, revenue, profit and return on equity have all shown strong improvements reflecting the success of our focus on low cost with care and convenience. At the same time as driving the financial performance of the business, our now well established management has also expanded Easyjet's network and fleet, which carried over 37 million passengers in the year, making the airline the fourth largest in Europe."

Easyjet said it expected to complete the £103.5 million purchase GB Airway by 31 January 2008. (source: BBC News)

Northern Rock offers below value

2007-11-19T00:58:00.000-08:00

It is understood that the two suitors, Virgin Group an Olivant Advisers, for Northern Rock have made offers for the takeover of Northern Rock that is "materially below" the stricken bank's share price. The bank said that it expected further expressions of interest to emerge.

Separately, the government has said there is no certainty that any bidder for the Rock will have access to £24 billion of emergency loans after February, but it added that it was "willing to discuss" any proposals that envisaged a continuing role for the Bank of England, the Treasury and the Financial Services Authority. The Treasury has also warned that the support it has provided to Northern Rock represents state aid under EU rules and may therefore turn out to be illegal.

Chief Executive at Northern Rock who resigned on Friday, Adam Applegarth, said that “while it would still analyse and discuss proposals it had received the value to shareholders from any of the proposals remains highly uncertain. They would depend on factors including an improvement in market conditions such as access to liquidity.”

Northern Rock shares fell 2% in early trading to 129p. They had hit a high of £12.58 in February. (source: BBC News) - Final bids for Northern Rock today, New player in Northern Rock bid, Virgin pushes forward in takeover, It is all about Virgin

Google is on the verge of becoming a mobile phone operator. The company is secretly testing a wireless network at the Googleplex in Mountain View, California, as it tries to gain valuable technological experience before a decision on whether to bid for part of the US mobile telecoms spectrum.

Google has made so much money from its computer based search that it has $13.1 billion (£6.3 billion) sitting in its bank accounts, and it has been spending heavily on new ideas to help it move into the search business on mobile devices. Analysts believe the market for placing ads alongside search queries on smartphones may eventually eclipse PC-based revenues.

While Google could still hitch up with a more experienced telecoms partner to make its pitch, it is believed to be leaning towards a go-it-alone bid that could cost it $4.6 billion (£2.2 billion) or more. A bid for a part of the telecoms spectrum would be an audacious way of circumventing the existing US mobile carriers – AT&T, Sprint, Verizon and T-Mobile – with whom Google is frustrated because they restrict which handsets and internet services can be used over their networks. Sandeep Aggarwal, analyst at Oppenheimer, said that the existing carriers are the biggest obstacle to Google getting into search-based advertising on mobile phones. However, he said: "We think that Google's bidding in the spectrum auction in the US makes sense only if it can materially subsidise or offer free wireless services without losing money, can run wireless services better than the existing wireless carriers, and find more uses for the spectrum bandwidth to drive additional economic value." (source: The Independent)

He's got the bug for Business

2007-11-17T03:40:00.000-08:00

He’s got the bug for business – At university when, with fellow trainee doctor and subsequent City enfant terrible and onetime colleague, Hugh Osmond, he ran clubs for students. “I thought that if you work for yourself the freedom it gives you is compelling, and that was the attraction. I happen to believe that entrepreneurs and people who build businesses are a lifeforce – be they Phillip Green or Bill Gates, who ever. Someone has to take the risk. To create a shop, newspaper, whatever its about making things happen.”

Until Mr Johnson was 27, he worked for other people, for Johnathan Aitken, the businessman and former Tory MP, for Grieveson Grant, the stockbroker, as an equity analyst, and at an advertising agency as account director. Then, in 1989, he broke away, buying a theatre scenery business. “It was a terrible business to be in. One minute the staff were working full-time on an Andrew Lloyd Webber. Next they could be doing nothing but you still had to pay them. Not long after I’d bought it we went into a recession which most of us have forgotten. That was very tough.”

Mr Johnson has never done an MBA. He thinks business is common sense. If you run out of money, you go bust – it’s simple. Business is ruthless and mathematical but simple. “I always make sure I have partners who are industry experts, who know what they’re doing. I believe in properly motivating people, in aligning businesses in the same industry. I’m not clever enough to judge economic cycles and make those sorts of plays – I’m always out there, involved with various things which I believe will be good enough, in good or bad times. It helps as well if you like the business you’re in – like restaurants and bookshops.”

Mr Johnson’s transformational deal was with Osmond, when they acquired Pizza Express in a £20 million reverse takeover in 1992. Their timing was immaculate. The downturn was ending, people were eating out again and pizzas were the all the rage. They expanded like mad, taking the chain to 250 branches and to a value of £700 million.

In the City, he is regarded as some thing of a wunderkind, still young and cocky. The word “lucky” is often thrown in his direction. He has been, but most of that is luck he has made for himself. He is chairman of Channel 4, which he thinks will remain state-owned, under this government. He was given a piece of advice before he started at Channel 4, which he held dear “Leave Channel 4 in a better condition than I found it.”

Relevant articles - The owner of over 70 bookshops - Mr Luke Johnson
The owner of Borders - Businessman of the Month

Final bids for Northern Rock today

2007-11-16T01:58:00.000-08:00

All potential suitors for Northern Rock have until today to submit their proposals to rescue the failing bank. Virgin Group and US private equity firms JC Flowers and Cerberus are among those expected to come forward with offers for the beleaguered lender. With a pay back to the Bank of England of £24 billion, bids are set to be very low. Options ranging from an outright buyout to a breaking up of the ailing bank's assets are expected to be proposed.

A consortium led by Richard Branson's Virgin Group has expressed interest in buying a majority stake in the Newcastle bank, which is responsible for about 1 in 5 mortgages in the UK, and rebranding it as Virgin Money. JC Flowers, has put together a high-profile management team to make their case for taking over the bank stronger, while rival private equity firm Cerberus has also been rumoured to have been scouring Northern Rock's books. Other expressions of interest have become from the former boss of Abbey National, Luqman Arnold. Mr Arnold will make a move through his investment group Olivant and will take minority stake in Northern Rock.

BBC business editor Robert Peston has previously said that there were three possible different destinations for Northern Rock:

1. the sale of the whole company
2. the sale of the basic physical infrastructure of the business i.e. the branches, information technology and call centre, which may also include Northern Rock's £13.5 billion of retail deposits and matching assets
3. the sale of the infrastructure plus all those securitised mortgages

A private equity buyer would be a controversial choice given their reputation for buying firms on the cheap to turn a fast profit, particularly because any buyer is likely to demand that the Government continuing to guarantee savers' deposits in the bank. There have been reports that buyers would call for interest payments on the Bank of England loans to be scrapped - arguing this would enable them to save jobs. (source: BBC News)

J.C. Penney Co. the department store operator based in Texas, reported Thursday a 9.1% drop in third-quarter profit, hurt by sweeping discounts to clear unsold merchandise. The department-store operator cut forecasts for the fourth quarter and the full year, citing macroeconomic concerns.

J.C. Penney's sales have been hurt by unseasonably warm weather and softer consumer spending, forcing it to lower prices more than expected to clear increased stocks of goods. Against a backdrop of record-high oil prices and slowing housing and credit markets that have hurt mid-priced shoppers, the retailer lowered salary expenses, is reducing the size of its Big Book catalogue and will keep a tight rein on inventory and other expenses heading into the holiday season. Chief Executive, Myron Ullman said at a conference with analysts “Our focus is the moderate consumer, the consumer who has always had to make serious choices about their discretionary spending. We have to be realistic about our expectations for the balance of the year," and added that "2008 is going to continue to be a difficult environment. We are planning 2008 very conservatively on expenses."

J.C. Penney's net income fell to $261 million (£127.9 million), or $1.17 (57 pence) a share, for the third quarter ended November, 3rd, from $287 million (£140.6 million), or $1.26 (61 pence) a share, a year earlier. Sales fell 1.1% to $4.73 billion (£2.31 billion).

Many retailers last week reported their worst October results in a decade, hurt by weather and consumers' jitters about the economy. (source: Market Watch)

Black Economic Empowerment (BEE) laws in South Africa may clip Comair’s, which operates the British Airways franchise in South Africa, wings by the Government for failing to comply with laws aimed at increasing the number of black employees in its workforce.

The Department of Labour said the airline, which also runs the low-fare Kulula.com service, could become the first publicly traded company to be taken before the courts for breaching the employment equity provisions of Black Economic Empowerment (BEE) legislation. The airline confirmed that it had received notification from the department of its intention.

Comair representative said: “We don’t want to comment on the specifics of the allegations as it may jeopardise the current legal proceedings besides to reiterate the following: Over the past five years Comair has increased its representation of black employees from 29% to 55%, and employees from designated groups now represent 80% of the workforce. This is despite the general shortage of pilots in the industry, of which approximately 7% are black.”

The company is 12.9% owned by British Airways, and also allegedly failed to submit a report to the director-general on the first working day of October and submitted reports to the Department of Labour that were not based on any existing employment equity plan.

Industry sources said the charges include allegedly failing to prepare an employment equity plan and failing to appoint one or more senior managers to take responsibility for monitoring and implementing an employment equity plan from 2000 to last year. (source: Timesonline)

Starbucks is having to scrap some of its most ambitious expansion plans after figures showed that Americans are popping into the local Starbucks for their morning pick-me-up in fewer numbers. News of lower customer traffic at its 10,000 US stores and a warning of lower profit growth next year sent Starbucks shares plunging 9% in after-hours trading last night.

The company scattered the blame for the bad news saying it had scared customers away with price rises meant to compensate for rising milk prices, and many of its managers had spent too much time focusing on expanding the snacks business and failed to focus on the quality of the coffee service. Most of all, executives said, US consumers simply have less money to spend since mortgage payments, petrol prices and the cost of groceries have all gone up this year.

Wall Street analysts, though, suspected another reason, namely that the Seattle chain has expanded to such an extent that new stores are eating into the customer numbers of existing outlets, which might be as close as one block away.

Starbucks chief executive, Jim Donald said “the company would open 1 600 stores in the US next year, 100 fewer than previously suggested. This would rectify the fact that the company opened more than originally planned this year, and there was still plenty of room for growth since the company accounts for less than 10% of takeaway coffee sales in the US and less than 1% worldwide.”

In the financial year just ended, the company opened 2 571 new coffee shops, 70% of them in the US. It posted net income of $673 million (£329.9 million), up from $574 million (£281.3 million) last time, on sales up 21%. Mr Donald revealed that Starbucks would this morning begin its first nationwide television advertising campaign to promote its special Christmas coffees. (source: The Independent)

Merger would not affect ArcelorMittal

2007-11-15T02:52:00.001-08:00

The world’s largest steelmaker’s major shareholder & chief executive officer, Lakshmi Mittal, said yesterday that the prospect of a £166 billion merger between Rio Tinto and BHP Billiton would not affect his company. Mr Mittal said that “any merger was an endorsement for ArcelorMittal’s strategy of vertical integration. About 45% of our iron ore supplies comes from our own mines; by 2012 we want that figure to be about 75%. If it happens, this merger just reinforces that that strategy is the correct one. We haven’t seen a formal offer yet and we are keeping an eye on this, but so far no one from BHP Billiton has had any communication with us.”

A merger between the rival mining groups would give the new company about 27% of the world market for iron ore and has excited concern in the steel industry, particularly in China, a leading consumer of steel and other natural resources. The world’s largest steelmaker was formed through a mega-merger of the world’s largest and second-largest steel companies last year, although the legal merger of the two entities was completed only yesterday. It is worth £50.5 billion and is three times bigger than Nippon Steel, its nearest rival.

Earnings for the nine months to September 30 were 30% higher than they were in 2006, at $14.6 billion (£29.7 billion). The increase to earnings has enabled the company to raise its dividend by 20 cents increasing quarterly payments to 37.5 cents a share. ArcelorMittal pledged at the time of the merger to return 30 per cent of net income to shareholders every year, through an annual dividend and share buybacks. (source: The Times)

Official figures yesterday showed that UK retail sales fell during October for the first time in nine months, according to The Office for National Statistics (ONS). Sales slid 0.1% in October, compared with a 0.3% rise in September.

Weaker demand for clothing and footwear as a result of the wet summer kept shoppers at home, while higher interest rates also dented sales. The numbers are likely to reinforce the calls for the Bank of England to cut interest rates and help stoke demand.

Alson Clarke at BNP Paribas said "Retail sales have been surprisingly elevated for some time now and today's data shows that this is starting to unwind," Sales over the three months to October were up 5.1% from the same period a year ago. An increase of 1.4% from the previous three month period from May to July was also observed. (source: BBC News)

Sainsbury's reported pre-tax profits

2007-11-14T01:06:00.000-08:00

Following on from the “price war” between supermarkets, J Sainsbury (the third largest supermarket in the UK) has beaten City forecasts in its first results since Delta Two, the Qatari investment, walked away from a takeover bid, with pre-tax profit growing by 20% during the first six months of the year. The supermarket group reported pre-tax profit up from £194 million to £232 million for the six months to October 26.

Like-for-like sales at the supermarket, which excludes gains from new stores opened in the first half of the year, rose by 4% after Sainsbury's reported a 5.1% rise in the first quarter of the year which slowed to 3% in the 16 weeks to October 6. Overall sales increased by 2.8% to £9.9 billion. (source: Timesonline)

Although this might seem like a new idea, it has actually been born earlier this year but is opening for service today. The newest addition to Sir Stelios Haji-Ioannou's (easy Group founder) (pictured) stable of bright orange and white brands opens its door today, offering cut-price office space in the upmarket Kensington area of London. Sir Stelios, is aiming easyOffice at the growing number of young entrepreneurs.

According to research by Barclays, more than a quarter of a million new businesses were set up in the first half of 2007, up 7% from last year and Sir Stelios wants to capitalise on that. Sir Stelios's target market, the under-25s, grew the fastest, setting up 20,000 businesses in the past 12 months, up 15% year on year.

In a statement, the easyJet founder said “the idea was to get people with business ideas on their feet. Over the years I have met many people who start their business from their bedroom or kitchen table. They reach a stage where they need three things: an address which is not residential; a place to meet clients, other than the local Starbucks – and once they are ready to hire staff, they can't really tell them to start reporting for work at their own home."

Sir Stelios was quick to dismiss suggestions that this was a venture into commercial real-estate, saying: "We are a booking engine, not a property company ... In fact, I am just using the upstairs of the easyInternetCafe site in Kensington for the pilot phase." The Kensington High Street site will have offices available for as little as £99 a week. (The Independent)

Increase in British Airways fuel surcharges

2007-11-13T02:03:00.000-08:00

Higher oil prices forced British Airways to increase fuel surcharges for the third time this year as it admitted that its fuel bill this year will top £2 billion. Analysts warned that all airline passengers could be affected with other carriers expected to follow suit and drive up ticket prices.

Robert Boyle, BA commercial director, said: "The cost of oil has reached record levels, rising by more than $20 (£9.68) a barrel since we last increased our fuel surcharge in June 2007." From Thursday, the surcharge on flights lasting more than nine hours will rise by £30 to £116 for a return ticket, while the levy for sub-nine-hour long haul flights to destinations such as New York will increase by £20 to £96. The surcharge on return short-haul flights will increase by £4 to £20.

KLM, the Dutch arm of Air France, also announced an increase in surcharges yesterday, which followed recent increases by Ireland's Aer Lingus and Virgin Atlantic.

Yesterday's announcement is the airline's first surcharge increase since it was fined a total of £270 million in August by the US department of justice and the Office of Fair Trading for colluding with Virgin Atlantic over the setting of fuel levies. British Airways admitted that members of staff had breached competition law by discussing planned surcharge increases with the airline's arch rival. (source: Google News)

Vodafone today raised its forecasts for annual revenue growth but sounded a note of caution for the second half of the financial year due to "competitive" pricing in the European market. Vodafone expects full-year revenues to reach between £34.5 billion and £35.1 billion, against a previous range of between £33.1 billion and £34.1 billion. Shares in Vodafone rose 2.86%, up 5.2p, to 187.2p in early trading.

Analysts had been expecting the operator to increase its forecasts after upbeat statements from rivals, France Telecom and Spain's Telefonica in recent weeks. Vodafone has been focusing on revitalising the business after it reported a £14.9 billion loss two years ago, the biggest loss ever made by a European company.

Today, the company reported sales for the six months to September 30, 2007, up 9% to £17 billion, with organic growth up 4.4%. Pre-tax profit over the first half of the year rose to £4.5 billion from a £3.3 billion loss in the comparable period.

On further expansion, Arun Sarin, chief executive at Vodafone, said “the group will wait for the end of a strategic review at Vodacom, its South African joint venture with local fixed-line incumbent Telkom, before increasing its 50% stake.”

The review is expected to take “a couple of months” and Mr Sarin said: "At the point we will have a better idea of what is available at Vodacom, if there is a stake available at the right price."

Mr Sarin declined to say by how much it will raise its stake in Vodacom but said: "The remainder of the shares will be listed, we will not take the whole 50 per cent." (source: Timesonline)

Facebook to enter Chinese market

2007-11-12T14:09:00.000-08:00

In a bid to grow its presence in the business intelligence software market, computer giant IBM is to buy software firm Cognos for $5 billion (£2.4 billion). Business intelligence software is aimed at helping large companies analyse information for complicated issues such as strategy or staffing. IBM proposes to pay $58 (27.6) for every share of Canadian-based Cognos, with other firms also growing their business intelligence software such as SAP, which is set to buy Business Objects.

IBM and Cognos, which employs 4,000 people worldwide, already have an existing business relationship. The purchase is expected to close in the first quarter of 2008 and needs approval from Cognos shareholders. Steve Mills, senior vice president at the IBM Software Group said "we chose Cognos because of its industry-leading technology that is based on open standards."
IBM shares rose 1% to $101.27 (£48.22) on the news. (source: BBC News)

Speculation is growing that Facebook is preparing a foray into China, with the social network being linked to a number of possible acquisition targets in the world’s second-largest internet market. Zhanzuo.com, a Chinese social networking site is reportedly in sight by Facebook. According to the Chinese press, Facebook has maintained an interest in Zhanzuo.com despite the Chinese group rebuffing an offer of up to $100 million (£48 million).

A spokesman for Facebook (who today denied the reports) said: “Facebook has no plans to acquire any company in China. In the coming months, internationalisation of the Facebook website is priority and those efforts will support multiple markets around the world.”

However, Facebook, itself the centre of takeover speculation in recent months, has also been linked to Tianwang, a Chinese search engine, and Xiaonei.com (meaning on campus), the leading social network in China, which has an appearance similar to Facebook and claims to have 8 million active users in almost 8,000 colleges and universities in China. Xiaonei.com was acquired last year by Oak Pacific Interactive, the Chinese new media conglomerate.

It is estimated that China has some 162 million internet users, placing it second only to the US. According to a recent poll, the average Chinese user spends between 14 and 19 hours a week online, compared with between seven and ten hours in the US.

In 2005, Yahoo! announced it would merge its Chinese arm with Alibaba.com, a domestic rival, drawing a line under years of losses in the country. EBay, the world’s largest online auction house, has struggled to compete with China’s Taobao.com, despite the American company making its entry into China through the acquisition of EachNet.com, at the time China’s largest auction site. (source: Timesonline) - Facebook valued at $15 billion

O2 sought to dismiss reports that the Apple iPhone is selling at a slower than expected pace claiming the device was its "fastest-selling” ever. Peter Erskine, the chief executive of O2, which is Apple’s chosen network partner in the UK, said: “It has been the fastest-selling device we have ever seen. The phone had sold in the tens of thousands since its launch on Friday”

Britain’s biggest mobile operator also raised speculation about the potential hit to rivals such as Vodafone and Orange from its exclusive deal with Apple. Two thirds of customers buying the iPhone were new customers to O2. IPhone buyers must sign up to an O2 contract costing from £35 to £55 a month for a minimum of 18 months.

However the refusal of both O2 and Carphone Warehouse, the only independent retailer to sell the phone, to reveal exact sales figures, has raised speculation that the gadget a combined iPod music player, mobile phone and internet browser, is not living up to expectations. Carphone Warehouse had said that it hoped to sell 10 000 of the devices when the iPhone launched on Friday, while O2 said last week that it had ordered several hundred thousand units to sell over the next couple of months. (source: Timesonline)

An A380 superjumbo VIP order has been made by the world's 13th richest man, Saudi prince Alwaleed bin Talal. He has invested a small piece of his estimated $20.3 billion (£9.8 billion) fortune in an Airbus "Flying Palace", which is priced out of most tycoons' range with a retail price of $310 million (£147.6 million).

The passenger version of the A380 has already raised the bar in luxurious air travel, with inaugural customer Singapore Airlines fitting its business class section with double-bed cabins. However, private buyers will have much more leeway to indulge their whims, because the lack of hundreds of economy class seats leaves ample room for a kitchen, boardroom, cocktail bar, gymnasium, jacuzzi and giant plasma TV screens. Virgin Atlantic, one of the biggest investors in innovative airline products and a prospective A380 buyer, has considered installing a swimming pool and creche in its planes.

The plane will be delivered around 2010 and will take about two years to fit. Asked if the prince had chosen the layout of his new jet, Velupillai said his customer had "not decided yet". He said: "In general terms, the VIP A380s will have lots of bedrooms, plus lounges where up to 20 people can be seated." (source: The Guardian) - Battle for the Jets

New player in Northern Rock bid

2007-11-12T01:22:00.000-08:00

A group led by former Abbey boss, Luqman Arnold (pictured), has emerged as a fourth potential bidder for troubled bank Northern Rock. It is understood that Olivant, a private equity firm run by Arnold want 20% of the business and effective control with the promise that his expertise from stints at Abbey and investment bank UBS Warburg will be enough to transform Northern Rock's prospects. Olivant, which has so far made only a couple of significant investments, including a 10% stake in a Russian bank, is considering a proposal that does not involve the sale or break-up of the lender's business. Last night the Northern Rock board was considering the bid as a fall-back option in case the other proposals fail.

The Olivant team would not receive any remuneration, with their reward coming from any revival in Northern Rock's share price. They have spent the past month preparing a detailed plan to take control and keep the bank going as a viable business. Arnold came to prominence when he was parachuted into Abbey five years ago after it revealed large losses from its wholesale banking operations. He stabilised its performance before the business was sold to Spanish bank Santander.

So far three groups - a consortium led by Virgin Group and private equity firms Cerberus and JC Flowers have expressed an interest in Northern Rock. They all plan to inject billions to shore up the bank's mortgages, but want full control of its share capital in return, leaving investors with only a small share of the business.

In the summer, Olivant raised £750m to support bids for under-performing finance companies. Its Northern Rock scheme is thought to involve acquiring an equity stake of between 10% and 20%. Arnold would become interim chief executive, replacing Adam Applegarth. The bank's chairman Bryan Sanderson is believed to welcome Arnold's interest, but is waiting until an informal deadline for bids, set for this Friday, has passed before assessing its merits. (source: The Guardian) - Virgin pushes forward in takeover & It is all about Virgin (Articles on Northern Rock takeover)

Dubai-based airline, Emirates Airline gave European based group, Airbus a significant victory over Boeing yesterday with the largest-ever single-aircraft order or the A350 over Boeing’s rival 787 in a purchase worth $35 billion (£16.7 billion). Emirates was already Airbus’s biggest customer for the massive A380, with 55 aircraft on order.

Boeing was left in the shadows, despite sealing several deals of its own: a $3.2 billion (£1.5 billion) order from Emirates for 12 of its 777-300s and a $6.1 billion (£2.9 billion) deal with Qatar Airways for 30 787 Dreamliners and five 777 cargo aircraft.

The deal was a huge boost for Airbus, whose sales had been lagging behind Boeing this year. Now industry analysts predict that the European manufacturer will pull ahead of its American rival by the end of the year.

Analysts said that Emirates rapid expansion plans hinge on the region’s economic success, with more tourists filling its fleet to capacity. Dubai is also building a new airport to handle a potential 150 million passengers a year, more than twice the capacity of Heathrow.

Emirates will retire 56 to 58 aircraft from its existing fleet as it incorporates planes from the new order, which are not scheduled for delivery until 2014. The fleet’s capacity will increase by only 15%, slightly below its current rate of expansion of 20% a year. Robert Ziegler, a Dubai-based aero-space analyst, said: “Emirates are building the highest-capacity network in the world. No other airline has ever tried anything like that before. Everybody is asking the question: what on earth are they going to do with so many planes? And more importantly: will it work?” (source: Timesonline) - Global News (source: Wall Street Journal) (Emirates public offering), Further delays for 787 Dreamliner & BP fined for a record amount (Delays on 787 Dreamliner)

Virgin founder, Sir Richard Branson, is keeping up the pressure on the chancellor, Alistair Darling, to modify his controversial plans for capital-gains tax. He is proposing the qualifying period for 10% taper relief be extended from two years to perhaps five years. His views follow consultation with the Sunday Times Fast Track 100 companies and several other entrepreneurs.

After a recent meeting with Darling and Gordon Brown, the prime minister, Branson wrote: “I believe this would encourage longer-term investment in private businesses — as five years is a more reasonable time frame to build and grow a business. “It would also have the advantage of excluding the majority of the private-equity professionals who make a living out of buying and selling businesses from this taper-relief bracket.”

Darling’s attempts last month to simplify the tax regime and catch more private-equity executives in his net backfired. They will increase the effective tax rate on the sale of privately owned companies from 10% to 18%. As a result, many entrepreneurs are considering selling up before the rules come into play next April.

However, Darling has let it be known he could alter his plan to ease the burden on small-business bosses. Sir Richard Branson added that business owners “applaud your attempts to simplify the capital-gains-tax structure but they also feel that some further consultation would be beneficial to form a fair and equitable solution”. (source: Timesonline)

The Formula One debutant this year, Lewis Hamilton, is close to signing a clutch of endorsement deals that will put him on track to become the world's first $1 billion sportsman. It is believed that Hamilton has held discussions with his financial advisers about a range of options to maximise his earning potential, including listing himself on the London stock market.

The innovative move could see the racing driver list a minority stake in a company in which he would be the main asset and remain the major shareholder. Several US sports stars are considering similar proposals, including Derek Jeter, the star batsman at the New York Yankees baseball team.

Hamilton's multimillion pound salary from McLaren, his F1 team, is set to be dwarfed by the sums earned from endorsing and promoting products. If he chose to pursue a listing on the AIM market in London, he could, for example, sell a 10% stake in Lewis Hamilton plc, for $100 million (£47.6 million). Investors in the company would be paid a dividend equivalent to 10% of Hamilton's total future earnings. The company would be structured like any other listed vehicle with a board of executive and non-executive directors.

Earlier this month, Hamilton announced he was leaving the UK to live in Switzerland, where he could live anonymously and not be mobbed in the street. It is believed that he will also save up to $40 million (£19 million) in tax per year from the move. (source: The Independent)

BRIEF NEWS
A study estimates that online shopping in the UK is due to hit £40 billion ($84 billion) this year. The figure comes from price comparison website, Uswitch, which says the boom is being fuelled by cheaper broadband deals and faster connection speeds, whilst a separate study from Forrester Research predicts that online Christmas shopping will reach £13.8 billion ($28.98 billion) this year, a 42% increase on 2006.

Uswitch's 2007 figure is based on data pulled from official Office for National Statistics retail numbers. It predicts that the UK's online spending will further rise to £162 billion ($340.2 billion) by 2020, when it will make up 40% of total retail sales. (source: BBC News)

The owner of over 70 bookshops - Mr Luke Johnson

2007-11-11T02:36:00.000-08:00

Mr Johnson does not conform to the public’s notion of the roles he fills. He is 45, with a youthful, ageing rock star haircut. His father is Paul Johnson, the historian and polemicist. He isn’t at all plumy. His accent is ordinary bloke rather than posh public school – the result, presumably, of his parents insisting he went to a state grammar school.

He has a rumpled, mischievous air. Intelligent and quick, he’s someone who revels in challenging convention rather than going with the flow. He is rich, well over £100 million, married to Liza, a pharmacist, with two children. They have a house in Little Venice and other homes in Paris and New York. What is amazing from Mr Johnson is how he has done it. He studied medicine at Oxford, and to then land one of the best jobs in broadcasting with a medicine degree is unbelievable.

“I’ve been in business for over 20 years and I’ve a good team of partners working with me who are clever young men” Mr Johnsons says. “But there has been more to it. I look for an opportunity where I can add value and make a difference. Ok, I am a bargain hunter, I’m always looking for things that are cheap and are under-exploited.”

Patisserie Valerie is a good example of this. It is a good name with a wonderful proposition. It wasn’t being managed anywhere near its potential, so Mr Johnson opened a new one in Marble Arch and another in Queensway (both in London). They sell homemade, good quality pastries, good coffee and ice cream. That sort of authenticity is very rare and it’s that point of differentiation that attracted Mr Luke Johnson to Patisserie Valerie.

Together with his partners in his private-equity firm Risk Capital, he owns East, the fashion chain, Giraffe restaurants, Patisserie Valerie, the cakes and coffee shops, and GRA dog track. Plus in the past, Whittard of Chelsea, Punch Taverns, Belgo, Strada and Signature Restaurants, owner of The Ivy et al, have all passed through his hands. Lately he bought Borders books and is now also the owner of a bookshop chain with over 70 shops to his collection.

Please visit the entrepreneur again soon for some more updates on our businessman of the month, Mr Luke Johnson.

BHP Billiton's offer rejected

2007-11-09T01:15:00.001-08:00

An offer from BHP Billiton for Rio Tinto has been rejected for the merge of the two Anglo-Australian companies to create an iron giant valued at some $350 billion (£166.6 billion). A merger would create a base metals colossus with powerful positions in coking coal, iron ore, copper and aluminium. Rio shares gained 946p, or 22%, to £52.96 ($111.2) in response to news of BHP’s interest, while BHP fell 100p, or 5.%, to £16.56 ($34.77).

In rejecting the proposal, Rio said it had given it careful consideration but “concluded that it significantly undervalues Rio Tinto and its prospects”. A merger between Rio and BHP could provoke a political storm and push the mining sector to the fore-front of government concern about the emergence of cartels in strategic commodities. The price of iron ore and coal, key ingredients in the production of steel, has soared over the past two years and a combined BHP-Rio group would have more than a third of the market in both iron ore and coking coal.

Instead, demand for iron ore has continued to soar and a price leap of as much as 50% is expected in 2008. Queues of bulk carriers are creating bottlenecks at terminals operated by BHP and Rio in Western Australia. Pricing is negotiated annually by three producers, BHP, Rio and CVRD, the Brazilian miner. BHP and Rio set prices in Asia in bench-mark deals with Japanese steelmakers while CVRD negotiates with European steel mills. (source: Timesonline)

Savers had withdrawn £10.5 billion from the stricken bank, Northern Rock, causing shares to fall as much as 12% in early London trade. This is almost half the £25 billion it had in its deposit accounts before approaching the Bank of England for emergency cash. Shares in the troubled bank were trading down almost 2% at 149p.

Northern Rock's savings business is small fry compared with its mortgage operations, which generated the bulk of the bank's earnings. But now, the money in its saving accounts represents a key asset to the troubled lender which, could end up borrowing as much as £30 billion by the end of this year to finance its mortgage operations. The rapid pace at which customers are closing their accounts and switching to other High Street banks and building societies could represent another difficulty for possible bidders.

US private equity firm JC Flowers is likely to bid, having put together a high-profile management team to take charge if it is successful, while Virgin has strongly indicated its interest. Asian investors, including Industrial and Commercial Bank of China, are also being targeted by the bank's advisors in an effort to get the best deal, according to the Financial Times. It is unlikely any will be interested without a guarantee that the government-backed loan will remain in place. (source: BBC News) - Virgin pushes forward in takeover & It is all about Virgin