BUSINESS WITH PERSONALITY

STEVEN GERRARD SAVES LET THE

GAME BEGIN
CAPELLO’S BLUSHES GUNS AT THE
READY FOR THE
ENGLAND 2 HUNGARY 1 P22 GLORIOUS 12TH P18
Issue 1,197 Thursday 12 August 2010 www.cityam.com FREE

MARKETS PLUNGE UBS to fight

plagiarism
ON FRESH DIP FEAR accusations

▲
LEGAL
BY OLIVER SHAH
WORLD ECONOMY UBS last night said it would “vigorous-
▲

BY KATIE HOPE AND DAVID CROW ly” fight a potentially embarrassing

GLOBAL markets plummeted yester-
day after the Bank of England cut its
growth forecast and the US trade gap
widened dramatically intensifying
fears of a double-dip recession.
On Wall Street, the Dow Jones
recorded its biggest loss in six weeks,
dropping 2.5 per cent to 10,378.83
and taking the index into negative
territory for the year, while the FTSE
100 plunged 2.4 per cent to 5,245.21 –
its biggest single-day percentage drop
since 29 June. In Europe, leading
indices followed suit with Paris and
Frankfurt both closing more than
two per cent lower.
The sharp falls came as Bank gover-
nor Mervyn King was forced to down-
grade his forecasts for growth amid
charges that he had been “wildly opti-
mistic” in his earlier projections. The
Bank now expects a “choppy recov-
ery” with growth averaging 2.7 per
cent in 2011, down from its forecast in
May of 3.4 per cent, as chancellor
Osborne’s public spending cuts, out-
lined in his June Budget, begin.
The Bank for the first time also
indicated that there was an outside
chance that the economy could dip
back into recession, with its forecasts
for growth suggesting that it was fac-
toring in a three per cent likelihood
of a renewed downturn.
Labour’s Lord Myners said King had
“pointed the finger squarely at the
5,380
5,340
5,300
5,260
5,220
09:00 10:00
Mervyn King was forced to revise down the Bank of England growth forecasts in its Inflation Report yesterday
government” in citing reduced confi-
dence, limited credit and fiscal con-
solidation as “the things bearing
down” on economic activity.
King’s downbeat outlook came as
official data showed that the econo-
my added workers at the fastest rate
since 1989 in the three months to the
end of June, but economists warned
it would still not be enough to offset
huge public sector job cuts in the off-
ing. Employment jumped by 184,000
11:00 12:00 13:00
to 29m, the Office for National
Statistics said, while unemployment
on the International Labour
Organisation measure fell by 49,000
to 2.45m.
But the government was quick to
play down fears of a double-dip reces-
sion with employment minister Chris
Grayling hailing the figures as a
“good step in the right direction” and
energy secretary Chris Huhne insist-
ing the UK has “strong forces pushing
5,245.21
11 Aug
14:00 15:00 16:00
Picture: GETTY
us towards prosperity”.
Meanwhile, across the Atlantic the
US monthly trade gap grew by a
steeper-than-expected 18.8 per cent
between May and June to $49.9bn
(£31bn) – the highest since October
2008. Emerging just a day after the
Federal Reserve’s renewed push
toward monetary easing, the data
confirmed fears of a weakening eco-
nomic recovery.
INFLATION REPORT: P7, MARKETS: P16
lawsuit from a small news agency,
which has accused the investment
bank of lifting copyrighted material
for its in-house updates.
Energy Intelligence, an oil and gas
reporting service, claims UBS repro-
duced parts of its articles for its own
energy newsletter, Daily Oil News. It is
understood UBS’ publication is an
aggregation of sector-specific news
rather than proprietary analysis.
UBS lifted information from
Energy Intelligence and sent it out to
clients at least 10 times between 2006
and 2007, according to papers filed at
the High Court of Justice.
At the heart of the case is London-
based UBS oil analyst Jon Rigby. Rigby
had a single-user subscription to
Energy Intelligence news and coordi-
nated the institution’s Daily Oil News
publication, which is sent out to 17
countries, the lawsuit alleges.
According to Bloomberg, UBS is
accused of acting “in a systematic
manner over a long period of time...
[with a view to] enhancing its profile.”
UBS stated: “UBS intends to defend
the case vigorously.”
UBS oil analyst Jon
Rigby leads the team
accused of copying arti-
cles from news agency
Energy Intelligence

FTSE 100 ▼ 5,245.21 -131.20 DOW ▼ 10,378.83 -265.42 NASDAQ ▼ 2,208.63 -68.54 £/$ ▼ 1.56 -0.02 £/¤ ▲ 1.22 +0.01 ¤/$ ▼ 1.28 -0.03 Certified Distribution
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 2 News
Desmond’s Channel Five revolution
DEPUTY EDITOR’S LETTER
DAVID HELLIER
THE inevitable bloodbath occurred at
Richard Desmond’s newly acquired
Channel Five yesterday as seven direc-
tors and more than a quarter of the
300 employees were given their
marching orders.
The Northern & Shell and Express
Group owner has promised further
cost savings at the loss-making broad-
caster but also an expansion of the
programming budget to £300m a year
over the next five years.
He will cross promote the channel
in his celebrity-focused OK! magazine
and no doubt there will be some
7th Floor, Centurion House,
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Deputy Editor David Hellier
News Editor Ben Griffiths
Night Editor Katie Hope
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Printed by Newsfax International,
Beam Reach 5 Business Park,
Marsh Way, Rainham, Essex, RM13 8RS
WHAT THE OTHER PAPERS SAY THIS MORNING
EVERBRIGHT BANK PRICES IPO AT TOP
OF RANGE
China Everbright Bank, the last of
China’s big national lenders to sell
shares to the public, is set to raise up
to Rmb21.7bn in its initial public
offering after pricing its shares at the
top end of an indicative range. The
country’s 11th-largest bank will sell
its shares at Rmb3.10 each in what
will probably be the second-largest
IPO so far this year in Shanghai, fol-
lowing the listing of Agricultural
Bank of China last month.
DIAMOND SALE SETS OFF ROW IN
HARARE
Zimbabwe has begun selling 900,000
carats of rough diamonds from the
controversial Marange-Chiadzwa
field, amid a political row over con-
trol of revenue from the sale. Sales
from the field in eastern Zimbabwe
were suspended in November 2008.
favourable mentions of Five pro-
grammes in the Daily and Sunday
Express.
Back in the 1990s, Lord Clive
Hollick promised the same sort of
cross promotion when he owned both
the Express group and the ITV fran-
chises such as Meridian, HTV and
Anglia. But the strategy never really
worked, both because the broadcast-
ing regulations at the time were
tighter and because ITV was not a sin-
gle unified group.
Desmond’s chances of achieving
cross fertilisation across his media
must surely be higher. Imagine a new
series of Big Brother promoted tire-
lessly in OK! and the Express and Star
titles, with exclusive interviews, news
stories and the like being shared
across the group.
There will be no reticence on
Desmond’s part about cross promo-
tion, current regulations permitting.
As far as I understand it, Channel Five
will be allowed to plug Desmond’s
newspaper titles so long as it does not
Private equity
job for Davies
PRIVATE EQUITY
▲
BY HARRY BANKS
FORMER government minister and
past chairman of Standard Chartered
Mervyn Davies has joined private
equity firm Corsair Capital, boosting
the specialist financial services
investor’s senior management team.
Lord Davies joins Corsair, which
spun out of JPMorgan Chase in 2006,
as vice chairman and partner, based
in London.
He most recently served as minister
of state for trade, investment and
small business under Gordon
Brown’s Labour government, a post
he took up after leaving Standard
Chartered in 2008.
The move sees Welshman Davies
return to the buyout firm in a full-
time deal making capacity. He previ-
ously served as a member of its
UKRAINE CONSIDERS CAP ON WHEAT
EXPORTS
Ukraine, one of the world’s top grain
exporters, said yesterday it was con-
sidering a cap on wheat exports, a
move that would put more pressure
on surging global grain prices. The
announcement was made after
Russia had introduced a ban on grain
exports until the end of the year fol-
lowing the devastation of its crops by
the worst drought in a century. The
World Bank has urged countries not
to restrict trade in grain.
IRAN HIT BY TOUGH FUEL SANCTIONS
Tougher sanctions against Iran
appeared to have halved the country’s
petrol imports last month, according
to the International Energy Agency.
As a result Iran has been forced to pay
a 25 per cent premium to market
prices for its petrol deliveries as many
companies shy away from supplying
the country, the western countries’
oil watchdog said yesterday. The US
introduced new sanctions in June.
give them undue prominence. And
the newspaper titles will be free to
plug Channel Five as much as their
editors see fit (quite a lot, I suspect).
The key will be the extent to which
Desmond’s growing media empire is
successful in creating content that
people want to view or read about.
His ownership of the Express and Star
titles may have been profitable but
the Express and its Sunday stable-
mate have found it massively difficult
to reverse circulation declines.
While the newspapers in
Desmond’s empire are marginal play-
ers, the same is also true of Channel
Five. This is no News International,
whose brands, such as the Sun or Sky,
are media powerhouses.
Nevertheless my prediction is that
Channel Five, which lost £34m last
year, will shortly become profitable. It
will employ fewer people than before
and it will be a fairly unusual place to
work.
When Desmond took over the
Express Group almost ten years ago,
advisory board during his time as
Standard Chartered chairman. He
also served as a senior executive of
Wall Street giant Citigroup earlier in
his career.
Corsair counts Standard
Chartered’s Americas chief executive,
David Stileman, and Resolution chief
executive John Tiner – former head of
City watchdog the Financial Services
Authority – among its advisory board
members.
The firm’s investments include
California’s East West Bank and
Polish insurer PZU.
Mervyn Davies helped
establish Standard
Chartered as one of the
leading banks in Asia
and the Middle East.
UNHEALTHY WEALTHY SCRAP BUPA
PLANS
Fewer Britons and Americans are tak-
ing out private health plans, sending
profits from illness insurance at Bupa
in the UK and US tumbling. Bupa said
yesterday its surplus before taxation
came in at £162 million in the first
half of the year, down 1 per cent.
SECURITY FEARS RAISED OVER PALM
AND ANDROID SMARTPHONES
Concerns surrounding the security of
data sent over smartphones have
emerged after a technology consul-
tancy proved how easy it is to com-
mandeer a mobile phone and use it
to record conversations or steal pass-
words. MWR Labs took less than three
days to crack the security of smart-
phones running the Palm and
Android operating systems and is cur-
rently testing the integrity of similar
phones.
he quickly changed its culture and
screwed down costs. Most remaining
foreign postings were cut, staff num-
bers were reduced sharply and all
expenses considered unnecessary
were phased out.
My own favourite budget cuts story
from the time relates, bizarrely, to
uncooked pork. The features desk
used to feature the recipes of a
celebrity chef. Under a previous
regime the recipe would be cooked by
a known restaurant and the result
would be photographed for the
Express magazine. The new regime
instructed that one of the depart-
ment’s PAs cook the meals and then
get them photographed on-site.
The plan back-fired when the PA in
question, being Jewish, refused to
handle pork, leaving it in its raw state
for the photographer, whose picture
of the uncooked meat adorned the
feature page in the magazine. Life is
unlikely to be dull at Channel Five.
david.hellier@cityam.com
Allister Heath is away. More: P12
Baroness Warsi described the Labour government’s actions as “criminal”
MPs told to return pay-off
POLITICS
▲
BY DAVID CROW
FORMER Labour cabinet ministers
should hand back the £20,000 pay-off
they received on leaving government
to apologise for running up a huge
budget deficit, the coalition govern-
ment said yesterday.
In an attack that was dismissed as a
“gimmick” by Labour, Conservative
party chairman Baroness Warsi has
written to MPs who served in Gordon
Brown’s cabinet, accusing them of
NUNS ACCUSE BANKS IN $5M LAWSUIT
Germany’s Deutsche Bank and US
investment bank Morgan Stanley are
facing a $5m lawsuit led by a group of
Irish nuns. The nuns allege the two
banks profited at their expense by fail-
ing to redeem an investment linked to
the debt of German financial group
Dresdner Bank and in so doing cost
them millions of pounds.
BURBERRY CHIEF ANGELA AHRENDTS
TAKES PROFITS ON SHARES
Angela Ahrendts, the chief executive
of Burberry, has raised about £3.4m by
selling almost 400,000 shares in the
luxury goods retailer. The sale has left
her with just under 364,000 shares in
the company, although she has
options over 1.8m more. Of the
amount that Ms Ahrendts raised,
about £814,000 was used to cover tax
liabilities. Burberry shares have risen
332.5p over the past year.
CITYA.M. 12 AUGUST 2010
NEWS | IN BRIEF
AIG sounds out appetite for AIA
American government-backed insurance
giant AIG has held talks with Asian sov-
ereign wealth funds including
Singapore’s GIC and Temasek over cor-
nerstone investments for its autumn ini-
tial public offering (IPO) of AIA, it is
understood. National investment corpo-
rations from Abu Dhabi, Kuwait and
Qatar are also thought to have shown an
interest in taking large chunks of shares
in AIG’s Far Eastern business. Up to 30
per cent of the stock could be placed
privately rather than through an IPO.
Lloyds exposed to resort failure
British taxpayers are on the hook for
millions of pounds of losses after Sea
Island, an exclusive US holiday resort
part-owned by Lloyds Banking Group,
filed for Chapter 11 bankruptcy. The
founding family behind the property
hopes to sell it to out of bankruptcy to a
consortium of investors for $198m
(£126m). At the end of last year, Lloyds
was among banks exposed to the tune
of $340m through loans to the compa-
ny. Sea Island began life in 1929 and has
hosted prestigious guests such as
Presidents Coolidge and Eisenhower.
Picture: REX
accepting “rewards for failure”.
“By running up colossal debts on
the nation’s credit card… what
Labour did to British people is frankly
criminal,” she said at a press confer-
ence yesterday.
The coalition is trying to make sure
that voters blame the previous gov-
ernment for swingeing public sector
spending cuts planned by chancellor
George Osborne.
A Labour spokeswoman dismissed
Warsi’s claims as “pathetic” and
“diversionary”.
FASTWEB FOUNDER TO STAND TRIAL
A judge ordered Italian billionaire
and Fastweb founder Silvio Scaglia to
stand trial on Nov. 2 on charges of
belonging to a criminal association
aimed at tax fraud, Rome prosecutors
said. Mr. Scaglia, along with other for-
mer executives of Italian telecommu-
nications operators Fastweb and
Telecom Italia’s cable unit Sparkle,
are accused of involvement in a €2 bil-
lion ($2.64 billion) money laundering
and tax fraud scheme.
LAVAZZA BREWS DEAL WITH GREEN
MOUNTAIN
For an extra jolt to its finances, U.S.-
based Green Mountain Coffee
Roasters is selling a 7% stake to Luigi
Lavazza, Italy’s best-selling espresso
brand, for $250 million. Together, the
companies plan to develop new sin-
gle-serving espresso machines and
espresso capsules.
CITYA.M. 12 AUGUST 2010
US to tighten
rules in wake
of flash crash
▲
REGULATION
BY OLIVER SHAH
US regulators are considering sweep-
ing measures to prevent a repeat of
the so-called “flash crash” of 6 May,
when the Dow Jones sparked panic by
falling 1,000 points in 45 minutes.
The Securities and Exchange
Commission (SEC) and Commodities
and Futures Trading Commission
(CFTC) may extend upward and down-
ward limits on stock movements. In
June, the SEC approved rules to sus-
pend trading in S&P 500 shares which
see a 10 per cent swing in price dur-
ing a five-minute period. The restric-
tions could be applied to securities
from other indices. The authorities
are also mulling a ban on “stub”
quotes used by market makers.
Mary Schapiro, chairman of the
SEC, announced the possible steps at
a hearing to discuss the freak finan-
cial event three months ago. The
crash saw around 55 stocks on the
S&P 500 dive precipitously in the
space of minutes before climbing
back to their normal levels. Among
those affected were Accenture, whose
price plunged from $40 per share to
one cent, and Procter & Gamble, which
lost 35 per cent of its market value.
The SEC and CFTC taskforce will
deliver a report addressing the occur-
rence early next month. Some mem-
bers warned a similar lightning bolt
could strike again. CFTC commission-
er Michael Dunn said: “One thing
really struck me today... what hap-
pened on 6 May can happen again. In
fact, [people] expect it to happen.”
One senior Democratic senator,
Charles Schumer, called on the panel
to force market makers to step in and
provide liquidity at times of rapid,
unexpected price declines.
FAST FACTS | FLASH CRASH
● High frequency trading, whereby computer
algorithms transact large volumes of shares in
split seconds, has been seen as a possible cause.
● The four main US public exchanges now have
“circuit breakers” on S&P 500 stocks.
Rok finance director Ashley Martin (inset) has been suspended by the housing repair firm
Rok shares tank as audit
finds big financial failures
PROPERTY
▲
BY MARION DAKERS
HOUSING repair firm Rok shed nearly
half its share value yesterday after it
said “serious failings” were found in
parts of the business, resulting in the
suspension of its finance director.
Ashley Martin has been immediate-
ly suspended due to a need for “new
financial leadership”. The firm said
he is not suspected of fraud, but that
a further review will be carried out.
Rok warned full-year profits would
significantly undershoot market fore-
casts of about £20m because of finan-
cial mismanagement in its plumbing
division.
The profit warning followed an
independent review by accountants
BDO, who found “serious failings in
financial controls”.
The firm said its interim results
due on Tuesday will still be in line
with expectations. Shares closed
down 45 per cent at 16p.
News 3
GM is poised to
pull trigger for
$20bn flotation
AUTOMOBILES
▲
GENERAL MOTORS could file a regis-
tration for its initial public offering
(IPO) of up to $20bn (£12.8bn) as soon
as tomorrow, after it reports quarterly
results today, three people with
knowledge of the process said.
GM’s IPO registration was expected
later this month, but the company
and advisers have sent conflicting sig-
nals about how quickly that first step
toward reducing the government’s
majority stake could happen.
The IPO filing was expected in mid-
August, but GM chief executive Ed
Whitacre said last week that the com-
pany did not plan to file a registration
in the near term, prompting specula-
tion that the timing had slipped.
The timing of the IPO filing had
not yet been set and hinges on the
progress GM makes on securing a
credit facility in ongoing talks with
banks, according to a source.
GM, now 61 per cent-owned by the
US government, is counting on the
momentum from its second consecu-
tive quarter of profits to help it clinch
a $5bn bank credit facility as it pre-
pares for an offering by year end.
If the American automaker does
file for an IPO valued at $20bn, it
would be the biggest US IPO since
credit card firm Visa’s $19.7bn offer-
ing in March 2008.
CITYA.M. 12 AUGUST 2010
ING boss Jan Hommen saw a rebound to profit in the first half
Bank of
Ireland sees
losses surge
▲
BANKING
BY VICTORIA BATES
BANK of Ireland (BoI) yesterday dis-
tanced itself from its fellow state-sup-
ported Irish banks by reiterating its
commitment to regaining financial
independence, despite admitting that
underlying pre-tax losses doubled
over the first half of the year.
BoI, which is 36 per cent owned by
the Irish government, posted a core
pre-tax loss of €1.25bn (£1bn) for the
six months to end of June, compared
to a loss of €0.67bn last year.
But chief executive Richie Boucher
was adamant the group remains com-
mitted to extricating itself in a “safe
and prudent” manner from state sup-
port. The pledge come in stark con-
trast to its peers, after
fully-nationalised Anglo Irish Bank on
Tuesday won EU approval for a fresh
bailout of up to €10bn from the Irish
government.
Boucher said Bank of Ireland’s
recent €2.9bn independent capital
raising exercise was a “critical step” in
the process, demonstrating it has the
support of investors.
“We continue to build on this
through our focus on gathering cus-
tomer deposits and extending the
maturity profile of our wholesale
funding,” Boucher added.
Bank of Ireland, which last month
passed Europe’s stress tests with an
adverse scenario tier one capital ratio
of 7.1 per cent, comfortably over the
six per cent EU threshold, warned yes-
terday that loan impairment charges
had remained high as the Irish econo-
my continues to stutter. Excluding
the pool of toxic loans which it has
earmarked for sale to Ireland’s “bad
bank”, the National Asset
Management Agency (NAMA), impair-
ment charges on loans and advances
to customers fell over the first half to
€893m, just 3.6 per cent below where
they stood this time last year.
Underground workers vote to strike
▲
TRANSPORT
BY STEVE DINNEEN
LONDON could be plunged into trans-
port chaos after rail union RMT’s
members voted overwhelmingly in
favour of strike action.
The underground workers are furi-
ous the government is pushing ahead
with tough cost cuts they say could
total more than £4bn over three
years.
Picture: REUTERS
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It is thought station and ticket staff
are likely to bear the brunt of the
cuts. The union also says vital mainte-
nance work will be affected.
The union now has 28 days to
decide whether it will stage a walkout
that could bring the capital grinding
to a halt.
A spokesman for RMT said: “If you
start cutting back on these key staff it
will impact on the entire system. It
won’t just affect our members, it will
ING is back in the black
▲
BANKING
BY OLIVER SHAH
BAILED-OUT Dutch bank ING
bounced back into first-half profit
yesterday and said it was on track to
divest its insurance arm to comply
with European rules on state aid.
A strong resurgence in retail bank-
ing helped push ING to a net gain of
€2.4bn (£2bn) for the first six months
IN PARTNERSHIP WITH
affect the transport-using public.
“We also fear this is just the first
wave of cuts that could badly affect
the underground network. We want
assurances this won’t happen.”
Members of the union voted 76 per
cent in favour of strike action and 88
per cent of action short of striking.
It will now liaise with sister trans-
port union TSSA, which will
announce its own ballot result next
week.
News 5
of the year, up from a loss of €722m it aims to run on a standalone basis
last year, when it was hit by heavy by the end of the year. The business
writedowns to its bond and property snuck back to a slim pre-tax profit of
portfolios. Underlying profits from €154m over the half and lost €115m in
high street lending tripled to €944m the second quarter.
year-on-year in the second quarter as Chief executive Jan Hommen said
the institution enjoyed higher inter- the unit would be floated or sold,
est margins on savings and put aside with analysts estimating the total
less cushioning for bad loans. value at around €15bn. Proceeds will
But performance was less spectacu- be used to repay the €5bn ING still
lar at ING’s insurance division, which owes the Dutch taxpayer.
NAB reports
hike in its
bad debts
▲
BANKING
BY STEVE DINNEEN
NATIONAL Australia Bank’s (NAB) UK
operations have seen bad debts rise
according to a market update.
The firm’s Clydesdale and
Yorkshire Bank operations saw debts
that are more than 90 days overdue
rise from 2.98 per cent of gross lend-
ing in the first quarter to 3.36 per
cent.
This is in contrast to generally
improving bad debt ratios across the
majority of UK banks.
The results are still an improve-
ment on bad debt figures for 2009,
however.
The update said: “Trading condi-
tions remain challenging for busi-
nesses, and this is reflected in asset
quality measures.”
NAB says it is cautious about the
state of the UK economy but believes
it is on track to hit its target of £10bn
of new lending by October 2011.
It also said it has seen evidence that
businesses are feeling more bullish
Paul McCartney (‘Mike’s Brother’) by Sam Walsh © estate of Sam Walsh
and showing a greater appetite for
borrowing.
The bank reported earnings of
$1.1bn (£700m) for the three months
to June.
However, group revenue was slight-
ly below the average for the first half,
with NAB citing “ accounting volatili-
ty arising from increased credit
spreads”.
ANALYSIS l NAB
23.89
AUS$ 11 Aug
25
24
23
17 May 7 Jun 28 Jun 12 Jul 26 Jul 9 Aug
Cisco misses estimates
rose 27 per cent from a year earlier to
TECHNOLOGY
$10.8bn (£6.9bn). That was slightly
CISCO Systems quarterly revenue fell below market forecasts of $10.9bn.
slightly short of Wall Street’s expecta- Its net profit rose to $1.9bn from
tions, disappointing investors who $1.1bn a year earlier.
thought an improving economy and Cisco shares are down around six
growing internet traffic would have per cent so far this year, due to wor-
spurred even stronger sales of routers ries that slower growth in Europe and
and switches. China could hurt a nascent recovery
Cisco, the world’s biggest network in global technology spending. Cisco
equipment maker, said yesterday that is considered one of the technology
revenue in the quarter ended 31 July sector’s prime bellwethers.
 6 Focus on Standard Life CITYA.M. 12 AUGUST 2010

Standard Life
A BREAKDOWN OF STANDARD LIFE'S FIRST-HALF RESULTS

IFRS pre-tax operating profit up 10 per cent

to £182m

reports 10pc EEV pre-tax operating profit up 11 per cent to

£364m

profits boost Net inflows up 71 per cent to £5.3bn

Investment spend up 64 per cent to £72m

Dividend up 4.8 per cent to 4.35p

▲

INSURANCE were more deep-seated.

BY OLIVER SHAH UK operating profits were down
five per cent to £76m, partially
STANDARD LIFE delivered a higher depressed by an investment pro-
operating profit and cranked up its gramme, while the margin slipped 30

Investors should stick with this stock

dividend yesterday, but investors were
underwhelmed by weaker UK per-
formance and shrinking margins.
The Scottish life and pensions
group hailed “the progress we have
basis points to 1.5 per cent.
Barrie Cornes at Panmure Gordon
said: “What they’re doing in terms of
investing all comes through in 12 to
18 months’ time. In the meantime

made as a business” as David Nish
announced his first interim results as
chief executive. Strong sales in
Canada and Asia helped push operat-
ing profits up 10 per cent to £182m
on an International Financial
Reporting Standards (IFRS) basis,
with the post-tax figure also standing
at £182m after a loss of £20m last
year. Standard Life also boosted its
half-year payout 4.8 per cent to 4.35p.
But disappointed investors sold
Standard Life paper, sending the
stock down 2.4 per cent to 151.1p.
Given a share price rally of almost a
quarter over the past month some
analysts said profit-taking was to be
expected, but others said concerns
I’m not convinced growth will be as
stellar as it could be.”
Marcus Barnard at Oriel Securities
said it was difficult to gauge the out-
look for the company as it was still in
transition from mutual to large-scale
seller of savings products. “You can
give them the benefit of the doubt
but it’s difficult to get any great deal
of comfort from these numbers.”
Nish insisted the group was more
focused after the sale of its banking
and healthcare units and said the
board was unfazed by the prospect of
a weak economy. “In a lower-growth
environment you often see the sav-
ings rate go up because individuals
still have money,” he told City A.M.
Y
OU could forgive Standard
Life’s management for being
more than a little disgruntled
yesterday. The life insurer
delivered a robust set of results,
with embedded enterprise value
(EEV) operating profit up 11 per cent
to £364m, and International
Financial Reporting Standards oper-
ating profit up 10 per cent to
£182m.
New business growth was reassur-
ingly strong at 29 per cent and
inflows at Standard Life invest-
ments were up 52 per cent, bringing
third party assets under manage-
ment to a record-breaking £63bn.
Still, a bearish broker’s note from
Panmure Gordon, which downgrad-
ed the shares from “buy” to “hold”,
didn’t go down well with a febrile
market: the stock closed off 3.6 per
cent at 208.6p.
Sure, investors were probably a
little disgruntled that cash flow
grew by six per cent to £160m, while
the interim dividend was hiked by a
less impressive 4.8 per cent. And it
would be nice to know what the life
insurer plans to do with its ever-
growing £1.3bn cash pile.
But there is no doubt about it:
these are good shares, with an
impressive yield of 5.66 per cent,
better than rivals like L&G (4.27 per
cent) and Prudential (3.41 per cent).
And the long-term outlook is good
for life insurers, as people in the UK
put aside more for their retirement
to cope with the ever-worsening
pensions landscape. Sure, the
stock – like its peers – has had a
good run of late, meaning some are
going to take profits. But investors
could make more if they stick by
Standard Life.
david.crow@cityam.com
BOTTOMLINE
Analysis by David Crow
CITYA.M. 12 AUGUST 2010 News 7

Inflation forecasts
stretch credibility
ECONOMICS
▲

Fathom Consulting’s Danny Gabay report states: “The recent recession

BY JULIET SAMUEL
ANALYSTS reacted with incredulity
yesterday as Bank of England gover-
nor Mervyn King claimed that “tem-
porary shocks” were to blame for
persistent above-target inflation and
that the Consumer Price Index (CPI)
would return to the Bank’s two per
cent target before the end of 2011.
This means the Bank once again
pushed out the deadline by which it
will hit the target, having previously
forecast it would do so by the end of
this year.
But analysts said that after five
years of getting it wrong, the Bank’s
projections are testing credibility.
called King’s explanation for missed may have had a more immediate
forecasts “the Lemony Snicket adverse impact on effective supply
defence – it’s all a series of unfortu- than anticipated, so that a smaller
nate events. The Bank didn’t come margin of spare capacity has
clean about why their forecasts have emerged.”
been so badly wrong”.
And Henderson’s Simon Ward ANALYSIS l CPI Inflation percentage
(quarterly change on previous year)
cast doubt on the Bank’s assump- 5.0
tion that spare capacity will weigh
down on inflation next year: “Again, 4.0
they wheeled out this argument Actual
about spare capacity without taking 3.0
into account the fact that it has not
worked,” he told City A.M.. 2.0
Target
The Bank’s argument about spare
capacity defies some of its own 1.0
BoE Forecast
analysis. Explaining why its projec-
tions have been wrong, yesterday’s 2006 2007 2008 2009 2010

CITY VIEWS: ARE YOU WORRIED THAT THE BANK GOT ITS FORECASTS SO
BADLY WRONG? Interviews by Victoria Bates

MATTHEW KING | LLOYD’S BROKER

“I think it would be much worse if the situation changed and the Bank carried on being bullish regard-
less – it’s much better that it is prepared to revise these estimates. Also, they are just forecasts, ROH2
the Bank does not say this is what will definitely happen.”

JAMES COLERIDGE | RSA

“It is very difficult to predict anything too accurately at the moment with the climate being so volatile.
The rest of Europe is having a major impact on our economy, as is the news coming out of the US,
and the impact of the government’s austerity measures is yet to be seen.”

DANNY YIP | LLOYDS BANKING GROUP

“The Bank is now being realistic. Initially when we saw positive growth, everyone jumped on the recov-
ery bandwagon. But at least now we are prepared for the worst – it is a sign of transparency that
the Bank is ready to revise down its forecasts, not one of weakness.” A THREE DAY FESTIVAL OF CONTEMPORARY ARTS

King ups the ante on bank lending to small firms JOANNA MacGREGOR’S
with the decade’s average,” he said. Small business groups added
DELOITTEIGNITE10
MUSIC | ART | DANCE | THEATRE | FILM | FORESTS
▲

ECONOMICS
MERVYN King again waded into
the row over bank lending rates at
the Bank of England’s inflation
report meeting yesterday, accusing
banks of profiting off struggling
small businesses.
“The spread that banks are mak-
ing on loans is much, much higher
than it was before and compared
Unlike large businesses, he said
that small firms are unable to
access other sources of credit by
issuing equities or bonds.
His comments come after an
appearance before the Treasury
Select Committee last week in
which he referred to banks’ levels
of lending to small businesses as
“heartbreaking”.
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TICKETS £12 (£10 STUDENTS)

BY OLIVER SHAH
HOME loan volumes picked up in
June but still languished at about a
third of their pre-financial crisis
levels, according to the Council of
Mortgage Lenders (CML).
Banks and building societies
extended £13.1bn of credit to
housebuyers in June, an increase of
15 per cent on May’s figure and
those who benefited in the uplift,
with the number of loans going to
people without a foot on the prop-
erty ladder increasing 20 per cent
month-on-month to 19,400.
The total sum lent for mortgages
in the second quarter – £35bn –
was up marginally on last year, but
remained well below the £93.9bn
handed out in the same period of
2007. The CML warned the proper-
“Transaction levels are subdued
and likely to remain so while SUNDAY 5 SEPTEMBER AT 8PM:
access to credit is constrained,” said THE MONASTERY OF SOUND;
CML economist Paul Samter. Tashi Lhunpo Monks of Tibet
The industry body also found Paul Hamlyn Hall
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seven per cent up on the previous ty market was unlikely to surge cheapening their deals.
CITYA.M. 12 AUGUST 2010
Nestle ups outlook
as business booms
in emerging markets
RETAIL
▲
BY JOHN DUNNE
SWISS food giant Nestle raised its full-
year outlook yesterday after buoyant
demand for its strong brands in
emerging markets boosted sales in the
first half.
The world’s biggest food group said
its food and beverages business should
show underlying sales growth of
around five per cent.
So far the group – whose brands
include Nescafe coffee, Kitkat choco-
late bars, Perrier water and Buitoni
sauces – had only said growth should
beat last year’s 3.9 per cent.
Net profit rose to SwFr5.5bn (£3.3bn)
from SwFr5.1bn in the year-earlier
period, as sales grew 5.9 per cent to
SwFr55.34bn. Underlying or organic
growth -- which strips out currency
effects and acquisitions -- at Nestle’s
Thomas Cook hit as
Brits shun holidays
LEISURE
▲
BY JOHN DUNNE
TOUR operator Thomas Cook yesterday
warned full-year operating profit would
be at the lower end of forecasts after a
slowdown in bookings as Britain’s
emergency Budget forced holidaymak-
ers into ditching their plans to go
abroad.
Europe’s second-biggest tour opera-
tor also said the impact from disrup-
tion caused by a volcanic ash cloud
closing airspace in April and May had
been worse than expected while
unfavourable currency movements hit
profits.
Thomas Cook added that good sum-
mer weather and the World Cup had
contributed to holidaymakers opting
ANALYST VIEWS: CAN THOMAS COOK BOUNCE BACK?
RICHARD HUNTER | HARGREAVES LANSDOWN
“ While the news is disappointing and reflective of poor UK trading and prospects – quite apart from adverse
currency movements having had an impact – there are positives, such as the dividend yield which is currently six per
cent. Following these numbers, the current market consensus is that the shares are a ‘buy’.
SAM HART | CHARLES STANLEY
“ The shares look very cheap, but the trading update highlights the relatively low quality of earnings
in the tour-operator sub-sector. We think the shares will struggle to advance while earnings forecasts continue to be
downgraded. Our recommendation remains ‘hold’.
NICK BATRAM | KCB PEEL HUNT
“
The market was clearly preparing for the worst following the update from TUI Travel. However, a five per
cent downgrade represents a relatively robust and creditable performance. The performance could have been much
worse given the challenging economic backdrop.
food and beverages unit stood at 5.7
per cent. “We have increased invest-
ment in our brands, people and capa-
bilities and have prepared the
company for a more challenging sec-
ond half,” chief executive Paul Bulcke
said in a statement.
Jon Cox, an analyst at Kepler Capital
Markets, said: “This is an excellent set
of figures and a clear raise in guidance
despite talk of reconfirmation.”
Anglo-Dutch rival Unilever warned
last week the second half would be
tougher due to increased competition
and higher raw material costs.
Nestle chief executive
Paul Bulcke was upbeat
about the food and drinks
company’s strong per-
formance in the first half
of the year
to stay in Britain.
Chief executive Manny Fontenla-
Novoa said: “The fine summer weather
enjoyed over much of the UK and the
uncertain economic environment
have meant that bookings have been
softer, which has resulted in lower
margins.”
He said the company now expected
to make full-year EBIT (earnings before
interest and tax) of between £404m
and £405m compared with a consen-
sus forecast among analysts of £415m.
The total cost of the volcanic ash dis-
ruption is now expected to be £82m
compared with the company’s previ-
ous forecast of £60m to £80m, he
added.
The company said its strategy will
include concentrating in more upmar-
Consumer News 9
SWISS GIANT NESTLE IS ON A ROLL
Net profit was up
NEWS | IN BRIEF
Harris is JJB’s largest shareholder
US investor Harris Associates has
7.5 per cent increased its stake in JJB Sports to 17.9
per cent, making it the biggest share-
to SwFr 5.5bn holder in the recovering sportswear
retailer. Harris upped its stake to 116m
(£3.3bn) in the first half.
shares from 104m over the last few
days. Last week it raised its stake from
93m. The share-buying spree takes
Organic growth up Harris Associates ahead of Crystal
5.7 per cent Amber, which has a 15.4 per cent stake
in JJB. Chief investment officer at Harris
at food and Associates, David Herro, has been a
beverages unit long-term shareholder in the retail chain.
Nestle operates in Flying Brand profit crashes
Flower and gardening home shopping
86 countries group Flying Brands today said its half-
year, pre-tax profits slid 26 per cent to
around the world £1.4m but added that confidence about
and employs shoppers’ spending meant it was recom-
mencing shareholder payouts. But the
283,000 people firm, which owns the floral delivery
service Flying Flowers, still announced
an interim dividend of 1.6p a share after
it had ditched the payout in March last
year. It said sales in its gardening arm,
which offers flowers, bird food and
seeds online, were down slightly from
£11.3m during the six months to July
last year to £11m this time. The group's
chief executive, Stephen Cook, said: “Our
confidence in the future of Flying Brands
is reflected in our decision to return to
paying dividends.” The company said
@
future sales should increase.
@
ket holiday destinations on countries
including Turkey. Four or five-star
hotels account for more than 40 per
cent of its business.
That proportion will rise to between
54 per cent and 57 per cent next year,
Fontenla-Novoa said.
ANALYSIS l Thomas Cook Group
p
@
240
230
180.90
11 Aug
220
210
200
190
180
17 May 7 Jun 25 Jun 15 Jul 4 Aug
Interviews by John Dunne
”
”
MORE NEWS
ONLINE
”
www.cityam.com
 The Capitalist
10
GUARDIAN DRAGS ITS HEELS OVER
RENEWING HAY SPONSORSHIP DEAL
WHAT with an enthusiastic push into
online investment, a string of ill-
advised private equity deals and a
move to swanky new offices at Kings
Cross, it appears more traditional stal-
warts of the Guardian’s extra-curricu-
lar programme could be coming under
threat.
A little bird tells The Capitalist that
the newspaper’s long-standing spon-
sorship of the Hay literary festival is
currently under review, with a renew-
al of the deal next year “far from cer-
tain”.
“Not so,” huffs festival director Peter
Florence, though he does admit that
after almost a decade with the
Guardian in the title sponsor’s spot,
Hay is now “renegotiating” its media
sponsorship. An announcement is
expected in September.
Word from the Guardian’s upper
EDITED BY
VICTORIA BATES
GOT A STORY? EMAIL
thecapitalist@cityam.com
echelons is that the “chances are that
the sponsorship will be renewed”,
with plenty of the usual waffle being
spouted about contracts ending and
the importance of its key audience.
Mind you, that audience has cer-
tainly altered a bit in recent years as
Hay has broken free from its academic
constraints. It’s now a regular hotspot
for the doyens of finance and politics –
2010’s sparkling list of attendees
The Guardian has sponsored Hay for nine years Pictures: GETTY, Micha Theiner/City A.M.
included HSBC chairman Stephen
Green, big cheeses from fellow spon-
sors Barclays Wealth and Sky and min-
isters Michael Gove and David Willetts.
CALAMITY CHRIS
A statistical headache yesterday for
employment minister Chris Grayling,
after the Department for Work and
Pensions rapped out a press release
claiming that there are 71,000 house-
holds in London where no-one has ever
worked, equivalent to 23 per cent of the
capital.
Perturbed by the maths, a conscien-
tious City A.M.er rang up to check the
figures, to be greeted by a red-faced
Grayling has made a few statistics slip-ups
spinner. “It’s actually 61,000 house-
holds, equivalent to just seven per cent
of London,” she explained, apologeti-
cally.
This isn’t the first run-in Grayling
has had with a calculator, of course:
earlier this year, as shadow home sec-
retary, he was publicly rebuked by the
head of the UK Statistics Authority for
manipulating crime statistic compar-
isons in the election. Here’s to third
time lucky, eh?
SEX APPEAL
When it comes to sexual conquests,
iPhone users are even more
successful than England foot-
ballers. That’s the word from
dating site OKCupid.com,
anyway, which has
crunched the numbers on
almost 10,000 smartphone
owners and found that
Apple’s device was up to
twice as likely to get its
owner some bedroom action
as those with BlackBerry or Google
Android phones.
Men with iPhones had on average
10 sexual partners by age 30, com-
pared to 8.1 for the BlackBerry and a
pitiful six for the Android. The effect,
it would appear, is even more pro-
nounced for female iPhone users, who
had around 12.3 partners by age 30,
compared to similar numbers to the
men for the other two devices.
CITYA.M. 12 AUGUST 2010
FISH BOWL
They say looking at fish swimming
peacefully in an aquarium promotes
psychological and physical wellbeing,
so the many City workers moving into
the newly-constructed Heron Tower are
set to be a very healthy bunch indeed.
The tower yesterday took delivery of
Europe’s largest privately-owned
aquarium, shipped to Bishopsgate all
the way from Colorado. Once it has
been filled, the 12m x 4m x 2m tank
will hold 70,000 litres of water and will
be home to more than 1,200 tropical
marine fish imported from the epony-
mous Heron Island, located off the
Great Barrier Reef.
GREED IS GOOD
Investors who are easily star-struck
should probably steer clear of the CLSA
investor conference in Hong Kong next
month, where none other than
Hollywood star Michael Douglas is due
to be guest speaker.
Douglas’ main credential for the job
is his role playing trader Gordon
Gekko in the Wall Street films, though
he’s not afraid to bring a bit of alterna-
tive spice to the conference – topics
will range from filmmaking to nuclear
abolition and the prevention of small
arms proliferation.
CRIME STOPPERS
Finally, a bit of sleuthing for our read-
ers, after the British Transport Police
got in touch to ask for help solving a
case at Liverpool Street station.
The incident, which took place on
Sunday 11 July at 10.45pm, occurred
when a woman began to throw rub-
bish at three other women outside
McDonalds.
When her targets asked her to
stop, they were assaulted by her
male companion, who
broke one of the
ladies’ eye sock-
ets.
The woman
is white,
between the
ages of 20
and 23,
with blonde
hair which was tied
up. She was wearing an
orange dress with a leop-
ard print scarf. The
man is white, 5’10”
and of the same age,
with short dark
brown hair.
Anyone with infor-
mation can contact BTP
0800 40 50 40, quoting
reference 470 and the
date of the attack.
CITYA.M. 12 AUGUST 2010
Russian oligarch Oleg Deripaska wants to float another one of his firms Picture: REUTERS
RWE starts
auction for
German grid
▲
PRIVATE EQUITY
BY HARRY BANKS
GERMANY’S RWE, Europe’s fifth-
largest utility, said it has launched an
auction process for the sale of its gas
transmission network Thyssengas.
RWE, which has to sell the business
by March 2011 after settling an EU
antitrust investigation, said it was
expecting expressions of interest for
the grid by 25 August.
“We contacted potential investors
from Germany and abroad last week.
We hope to get answers from serious
investors by 25 August and finish the
process by the end of the year,” an
RWE spokeswoman said late yesterday.
One source who declined to be
named, but who is familiar with the
deal, said Thyssengas is estimated to
have a regulated asset base of around
€500m.
A consortium of Bavarian gas com-
pany Bayerngas and local utilities
Stadtwerke Dortmund, Dortmunder
Energie und Wasser, Stadtwerke
Bochum, Munster and Gelsenwasser
is interested in bidding for
Thyssengas, spokespeople for it said.
The sale could attract financial
investors such as infrastructure
funds, though German gas infrastruc-
ture deals have recently struggled.
RWE shares closed down 2.3 per
cent to €54.2, in line with the German
blue-chip DAX index, which closed
down 2.1 per cent.
ANALYSIS l RWE
€ 54.19
11 Aug
62
60
56
52
17 May 4 Jun 24 Jun 14 Jul
Micro Focus slashes its revenue target Deutsche eyes EU greens
▲
TECHNOLOGY
BY STEVE DINNEEN
MICRO FOCUS International was
forced to slash its full-year revenue
target after underlying growth stalled
in the first quarter, with customers
delaying contracts and low-value
deals remaining weak.
The firm’s shares fell 31 per cent to
a 16-month low yesterday after the
company, which upgrades legacy
pr
o m i se
e
W i
“1
www.cityindex.co.uk
0845 077 1178
1 point spreads available during our market hours only.
Spreads lowered on our rolling and daily future spread bet markets.
Spread betting can result in losses that exceed your initial deposit.
3 Aug
mainframe applications for compa-
nies like Boeing and Tesco, updated
the market.
The company said it now expected
low single-digit like-for-like revenue
growth in the year to the end of April
2011, instead of mid-single digit
growth. However, it expected no
change to earnings guidance after
cost cuts helped margins.
Analysts at Numis believe the mar-
ket overreacted, adjusting their rec-
Deripaska eyes new IPO
marketing his power unit – formerly
▲
ENERGY
called En+ Power – to potential cor-
BY HARRY BANKS nerstone investors in Moscow.
RUSSIAN oligarch Oleg Deripaska is Deripaska hopes to list 25 per cent
understood to be valuing his electrici- of EuroSibEnergo shares, meaning he
ty producer EuroSibEnergo at around could raise $2bn in what would be a
$8bn (£5.1bn) ahead of a planned huge boost to the flagging Russian
Hong Kong IPO this autumn. IPO market.
The billionaire, who successfully The Rusal float generated $2.2bn at
listed aluminium giant Rusal on the the beginning of the year, but the
same bourse in January, is currently Russian IPO market has been all but
t
n a s ”
,
oi pre
d
es:
p S nd
ic
jor
a TRIBAL Group, which provides gov-
sem
e coordinates school inspections, saw
th 0 its shares leap yesterday after con-
on 10
SE St
T 3 0
F y
all an
W rm 40
Ge nce
a
Fr
ommendation to “buy”. David Toms
ENERGY
said: “Our view is that the underlying
performance is fairly consistent. It ALTERNATIVE energy investment
was clearly a disappointment and has prospects have shrivelled in the United
refreshed investor concerns but in States after the Senate was unable to
our view these are overdone.” break a deadlock over tackling global
Chief executive Nigel Clifford said: warming, a Deutsche Bank official
“We still expect to meet our previous said.
expectations for full year 2011 adjust- “You just throw your hands up and
ed Ebitda and to achieve double-digit say... we’re going to take our money
revenue growth over the medium elsewhere,” said Kevin Parker, global
term.” head of the bank’s Deutsche Asset
News 11
closed since then as investors fret
amid global economic uncertainty.
Deripaska was Russia’s richest man
before last year’s economic slowdown
plunged his metals and power empire
into financial crisis – only alleviated
by a major debt restructuring and the
Rusal IPO. Deutsche Bank and China’s
BOC International are set to be the
joint bookrunners on the
EuroSibEnergo IPO.
Tribal Group
receives bid
approaches
▲
M&A
BY VICTORIA BATES
ernment outsourcing services and
firming it had been the subject of a
slew of takeover approaches.
The interest is thought to have
come primarily from private equity
companies, with Asia-focused New
Silk Route (NSR) or larger rival Capita
touted as potential buyers. Analysts
said Tribal’s budding Asian education
software business would strike a
chord with NSR’s strategic focus on
investing in Eastern markets.
Tribal’s government business also
looks attractive to bidders as the Aim-
listed company positions itself as a
leading consultant to the public sec-
tor, to help steer it through the slim-
ming-down process prompted by the
coalition’s austerity drive.
“The company is very well-posi-
tioned to support public sector organ-
isations as they undertake change
and to participate in an expected
acceleration of outsourcing opportu-
nities that will contribute to the
improvement in public sector effi-
ciencies,” Tribal said in an update yes-
terday.
Reports put the potential price tag
for Tribal at around 100-125p a share,
though sources close to the firm said
a bid at that level would be viewed as
relatively low-ball. Taking house bro-
ker Investec’s year-end EPS forecast of
11.6p as a basis, a bid at 125p per
share would put the company’s valua-
tion at under 11 times earnings – a
marked discount to larger rivals such
as Capita, which trades at over 17
times earnings.
“Tribal confirms that it has
received preliminary expressions of
interest which may or may not lead to
an offer being made,” the firm said
yesterday.
Management Division.
Parker oversees nearly $700bn
(£575bn) in funds that devote $6bn to
$7bn to climate change products.
Amid so much political uncertain-
ty in the United States, Parker said
Deutsche Bank will focus its “green”
investment dollars more and more
on opportunities in China and
Western Europe, where it sees gov-
ernments providing a more positive
environment.
 12 Technology and Media News
New Five boss
wanted Airey
MEDIA
▲
BY STEVE DINNEEN
NEW Channel Five owner Richard
Desmond was desperate to maintain
the services of outgoing chief execu-
tive Dawn Airey before her shock res-
ignation yesterday, according to
industry sources.
Airey has enacted a clause in her
contract that guaranteed her a senior
role at former Five parent company
RTL in the event of the broadcaster
being bought.
She will remain at the channel for
“a few months” to oversee the transi-
tion, which will include around 80 job
losses from the 300-strong staff.
She said yesterday: “The day Five
was sold, my job was done. I love Five,
its staff, its spirit and all we have
achieved. I wish the channel, its team,
Richard Desmond and Northern &
Shell all the success they deserve.”
Also following her out at board
level will be channel controller
Richard Woolfe, director of strategy
Charles Constable, director of corpo-
rate affairs Sue Robertson, managing
director Mark White, director of
finance David Hockley, director of
legal Paul Chinnery and head of HR
Natasha Adams.
It was announced that Five’s direc-
tor of digital channels Jeff Ford will be
promoted to programme director.
Desmond says the cost cutting drive
will be partly used to fund an ambi-
tious £300m a year investment pro-
gramme.
A spokesman said: “The savings aim
to realise efficiencies deriving from
Five’s integration into the Northern &
Shell group of companies and at the
same time develop an ambitious new
investment plan that will see the
channel go toe-to-toe with the biggest
players in the TV world.”
Trusted Desmond lieutenant Paul
Ashford is understood to have been
drafted in to oversee the cost cutting
drive.
(Clockwise from top left) Five boss Dawn
Airey, Five controller Richard Woolfe, Paul
Ashford and Five owner Richard Desmond
BlackBerry faces
India disconnection
TELECOMS
▲
BY STEVE DINNEEN
JUST days after avoiding its services
being shut down in Saudi Arabia,
BlackBerry is facing an even bigger
problem, with India questioning
whether to allow its services.
The emerging economic superpow-
er may temporarily shut down
BlackBerry’s messenger and email
facilities if security concerns are not
addressed in a meeting later today.
The news will heap pressure on
BlackBerry maker Research In Motion
(RIM), which was forced to cave in to
Saudi demands to hand over user
codes that would let Saudi authori-
ties monitor its BlackBerry Messenger
service.
In a matter of a few weeks the
BlackBerry device – long the darling
of the world’s chief executives and
politicians – has become the target
for its encrypted email and messag-
ing services.
Google Street View put under
scrutiny by German officials
▲
TECHNOLOGY
THE German government said yester-
day it will scrutinise Google’s prom-
ise to respect privacy requests by
letting people opt out of its Street
View mapping system and that it
would be ready to intervene if neces-
sary.
The response to Street View has
been overwhelmingly negative, even
though Germans have been given
assurances they can have images of
their homes kept out.
But Google’s announcement on
CITYA.M. 12 AUGUST 2010
Ousted HP
boss lowest
rated CEO
▲
TECHNOLOGY
BY STEVE DINNEEN
THE HP boss who was forced out
after allegations by a former porn
star had the lowest employee-rating
of any major tech chief executive.
Glassdoor, a website that allows
employees to anonymously rate com-
panies and their bosses, has Mark
Hurd languishing at just 34 per cent
approval, falling as low as 19 per cent
last year.
This is in stark contrast to Apple
boss Steve Jobs who has an astonish-
ing 98 per cent approval rating.
Hurd, 53, was forced to resign after
it was found $20,000 (£12,500) of
expense claims in his name were
inaccurate.
It then emerged the married chief
executive had been desperate to con-
ceal his relationship with Jodie
Fisher – the saucy star of movies
including Sheer Passion, Intimate
Obsession and Body of Influence 2.
India, like several countries in the
Middle East and North Africa, wants
access to encrypted Blackberry com-
munication, which has been linked to
militant activity including the
Mumbai attacks in 2008.
India’s home ministry will press for
a deadline to be fixed for RIM to share
encryption details.
Mobile phone operators could be
asked to shut down RIM’s enterprise
email and messenger services tem-
porarily as a last alternative, if RIM
does not agree to offer access to data.
The responsibility to meet Indian
security requirements rests with
mobile phone operators in India
rather than RIM.
BlackBerry chief
executive Mike
Lazaridis is desperate
to avoid a ban of the
firm’s services in India.
Tuesday that it would allow
Germans to stay out of Street View
failed to allay fears that privacy
would be compromised by the navi-
gation system.
Consumer minister Ilse Aigner
said: “We’ll take a very close look at
how effectively this works in practice
and we’ll see from there.”
More than 10,000 Germans have
already formally requested their
homes be deleted from Street View.
Criticism from civil rights watchdogs
will likely push that figure higher.
CITYA.M. 12 AUGUST 2010
Balfour Beatty sees profit lift
PROPERTY
▲
BY MARION DAKERS
CONSTRUCTION group Balfour
Beatty said it was well-placed to with-
stand public sector spending cuts as it
announced an increased order book
and an earnings boost from its US
acquisition.
The construction firm said yester-
day half-year pre-tax profit rose by 32
per cent to £141m, compared with
£107m in 2009.
“Our strategy has been to build
Balfour as a global infrastructure
Minerva calls
EGM following
KiFin bust-up
PROPERTY
▲
BY MARION DAKERS
PROPERTY developer Minerva has
called an emergency meeting to
drum up support following demands
for a boardroom shake-up from rebel
investor KiFin, owned by billionaire
Nathan Kirsh.
In the latest chapter of an extended
power struggle at Minerva, KiFin has
proposed the sacking of chairman
Oliver Whitehead and chief executive
Salmaan Hasan and called for more
transparency on terms of its recent
restructuring and profit share agree-
ments.
KiFin plans to install London prop-
erty veteran Philip Lewis as interim
chief executive, along with former
Investec boss Bradley Fried as a non-
executive director, if the moves win
shareholder approval at an emer-
gency meeting on 8 September.
Minerva has hit back at the propos-
als, accusing leading shareholder
KiFin of trying to take control of its
activities without paying, after its 50p
business. The results now reflect the
acquisition of Parsons Brinckerhoff ...
it’s performed extremely well in the
first half,” chief executive Ian Tyler
said.
Profit at Balfour’s professional serv-
ices division rose to £49m, against
£6m in 2009, largely as a result of the
company buying US management
firm Parsons Brinkerhoff, which con-
tributed a profit of £35m.
Its interim dividend rose five per
cent to 5.05p per share.
Balfour also has signed a £460m
contract for the second phase of satel-
per share takeover bid collapsed earli-
er this year.
“It’s a pretence to say they don’t
want to take control, given their
actions over a period of time,”
Whitehead told City A.M. “We have no
problem with them taking over as
long as they pay a proper price. By try-
ing to install Lewis, they are trying to
gain control without the hassle of a
takeover.”
“Besides the demands set out, we
have no idea what KiFin has planned
for the company. They are just mak-
ing mischief, putting out negative tit-
tle-tattle,” Whitehead added.
Lewis called yesterday for Minerva’s
other board members to get involved
and calm the dispute.
“They have got three good non-
executive directors who should be
making an effort to find a solution to
this problem,” Lewis said. “Kirsh is
not seeking control of the company.
We simply want management to
understand the importance of full
disclosure of the key financial infor-
mation that we are requesting.”
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Property and Construction News
lite building for Terminal Two at
Heathrow.
Tyler remained confident in the
face of government cuts in the con-
▲
struction sector.
“While there are challenges in
some markets, overall we still would
see in 2010 to 2011 areas where the
business will grow,” he said.
The firm’s order book stood at
£14.6bn in June, up from £14.1bn at
the end of last year. Tyler pointed out
that a substantial number of con-
tracts were funded by industry rather
than the public sector.
Liebherr rescued Southampton FC from the brink of extinction.
Saints left shocked after
owner Liebherr dies at 62
SPORT
▲
BY JON COUCH
SOUTHAMPTON Football Club was
left stunned yesterday by the death of
owner Markus Liebherr, aged 62.
The billionaire Swiss businessman
rescued the club from the brink of
extinction in July 2009 when he com-
pleted an estimated £13m takeover.
No cause of death was given.
Liebherr was a member of wealthy
family who specialise in construction
£24.50
www.boisdale.co.uk
Breeden dumps shares in
Connaught after warning
PROPERTY
HEDGE fund Breeden European
Partners has sold almost half its stake
in troubled social housing repairs
group Connaught, after the value of
its holding plunged by more than
£13m in recent weeks.
Breeden European had declared a
stake of 13 per cent, or 18m shares, at
the start of July, fuelling talk of a
break-up of the embattled firm.
Picture: GETTY
machinery, although he operates
independently through his own
group of companies, the Mali Group.
“To say he will be missed is an
unmistakeable understatement,” the
club said in a statement.
Southampton FC assured fans that
Liebherr’s passing will not affect its
future. It said: “The club will ensure
that Markus’ wishes are carried out in
full. The Saints were Markus’ constant
preoccupation. He certainly didn’t
like losing.”
Subject to availability until 16th August
Swedeland Court,
202 Bishopsgate
London, EC2M 4NR
020 7283 1763
13
A stock exchange filing yesterday
showed Breeden disposed of 8m
shares on Friday, the day Connaught
said it would make a loss for the year.
Asset manager Toscafund and
Norway’s national bank Norges have
also disposed of large holdings in
recent days as Connaught stock
remained in the doldrums. Shares
closed up 2.2p at 15.6p yesterday.
Breeden European could not be
reached for comment.
NEWS | IN BRIEF
Capital & Regional back in black
UK property fund manager Capital &
Regional swung to a first-half profit of
£18m yesterday, after a loss of £131m a
year ago, helped by higher property val-
ues and disposal of assets. The owner of
leisure centres and shopping malls said
it sold ten properties for £378m, with
its own share accounting for £80m.
However, the firm expects the pace of
asset sales to slow down after the
expected sale of its wholly owned prop-
erty Great Northern in Manchester.
DIY job for Berkeley chairman
The boss of building group Berkeley took
DIY to the extreme last year by calling
in his own firm to carry out £1.32m
worth of repair work on his luxury
home. Tony Pidgley took advantage of
the firm’s “own build scheme”, where
employees can get good rates on con-
struction work, according to the firm’s
annual report. He was paid a total of
£2.25m last year, while Rob Perrins,
managing director, collected £1.1m, both
in line with last year. Berkeley recorded
pre-tax profits of £110.3m in the period,
a decline of 8.4 per cent.
Grainger set to gain from slump
Britain’s biggest residential landlord
Grainger said yesterday it plans to cash
in on the wilting housing market by buy-
ing up discount real estate. The firm,
which has around £2.8bn of assets
under management, bought £154.8m of
properties in the past ten months, with
a further £67.6m of buys in the pipeline.
It sold 593 vacant units at a sales mar-
gin of 42.6 per cent. The firm also com-
pleted its purchase of Sovereign
Reversions, snapping up the equity
release adviser for £34.6m.
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CITYA.M. 12 AUGUST 2010 News 15

Shire sells off Attention Deficit Disorder CVC to buy 15pc Abertis
drug to Noven as reiterates profit view stake from ACS for €1.7bn
PHARMACEUTICALS Shire also backed its full year 2010 uct in 2009 were $71m. an indirect holding of 10.28 per cent
▲

CONSTRUCTION

BY HARRY BANKS
SPECIALITY biopharmaceutical com-
pany Shire yesterday announced the
sale of its brain stimulant medicine
Daytrana to Noven Pharmaceuticals,
granting Noven global marketing
rights for the medicine, effective
from 1 October 2010. Shire also main-
tained its earnings outlook for the
full-year 2010.
The book value of the assets to be
disposed is approximately $95m
(£60m) or a gross, pre-amortisation
value of approximately $150m.
outlook for non-GAAP earnings
trending towards $4.00 per American
Depositary Share (ADS), which was
announced recently with its second
quarter earnings. Analysts on average
expect the company to report earn-
ings of $3.98 per ADS for 2010.
In its second quarter report, Shire
said it expects 2010 underlying earn-
ings to grow 15 per cent from 2009.
Daytrana, developed and manufac-
tured by Noven, was originally
licensed globally to Shire in 2003 and
was approved and launched in the US
in 2006. Shire’s net sales of the prod-
In June, the FDA approved
Daytrana for treatment of attention
deficit hyperactivity disorder (ADHD)
in adolescents aged 13 to 17 years.
Daytrana was already an FDA-
approved ADHD treatment for chil-
dren 6 to 12 years. ADHD is one of the
most common psychiatric disorders
in children and adolescents.
The disorder manifests as a persist-
ent pattern of inattention and/or
hyperactivity-impulsivity that is more
frequent and severe than is typically
observed in individuals at a compara-
ble level of development.
▲
ACS has agreed to sell a €1.7bn
(£1.4bn) stake in toll road operator
Abertis to private equity fund CVC
Capital Partners, freeing up the
Spanish builder to cut debt and pur-
sue energy investments.
ACS, Spain’s largest builder by mar-
ket value, and British private equity
firm CVC said yesterday they will
form joint ventures to manage ACS’s
25.8 per cent stake of Abertis .
ACS will get €15 per share for its
Abertis stake, or €2.86bn, about a
fifth of which it will reinvest to retain
of the motorway firm, while CVC will
get a 15.5 per cent stake.
The deal, funded by a €1.5bn loan
from a syndicate of banks, brings sta-
bility to Abertis after months of spec-
ulation that ACS and CVC were
seeking financing for a leveraged buy-
out of a large piece of the company.
La Caixa – Abertis’s largest share-
holder – and Spanish banking giant
Santander are in the syndicate
financing the deal, which was
advised by Italy's Mediobanca.
ACS will take on €600m of the debt
for the deal, with CVC taking the rest.

AIG hit with BEST OF THE BROKERS

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2,358.00
11 Aug
ANALYSIS l International Power
380 p
ANALYSIS l Barclays
360 p 313.60
11 Aug

a $1.9bn loss
2,700 360 364.80 340
11 Aug
2,600 340 320

2,500 320 300

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on Fortress 2,300

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17 May

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7 Jun 25 Jun

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BARCLAYS
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Seymour Pierce reiterates its “hold” rating

4 Aug

American to “equalweight” from “over- “Buy” post its deal with GDF Suez which it saying it is concerned that reports of
INSURANCE
▲

BY HARRY BANKS
AMERICAN International Group (AIG)
said yesterday it will sell most of its
consumer finance unit to Fortress
Investment Group and take a $1.9bn
(£1.2bn) pre-tax loss due to the sale.
AIG, majority owned by the US gov-
ernment, is selling 80 per cent of
American General Finance to Fortress
managed funds and affiliates as it
servicing firm CWCapital. weight” and lowers its price target to sees as a “win-win”. Says shareholders will BarCap cutting jobs indicates that revenue
Fortress’s share price has been a 3,208p. Believes all the positives have been get immediate share price upside as well as in the investment bank is disappointing.
disappointment for investors since it priced into the shares, which are trading at improved long-term growth. Sees little risk Notes that top line income at BarCap was
debuted at $18.50 in 2007. Yesterday, at a 10 to 15 per cent premium to the sec- of the deal failing, and says IPR is now well down 32 per cent year-on-year in the first
after the AIG deal was announced,
the share price fell 4.5 per cent to $4, tor. Believes that investors should switch positioned for future growth. Ups target to half. Advises caution, noting investment
making it the industry’s worst per- into Xstrata which it rates as “overweight”. 410p from 320p. banking appears to be losing momentum.
former for the day.
AIG, once the world’s largest insur-
er, nearly collapsed in September
To appear in Best of the Brokers email your research to notes@cityam.com
2008 from credit default swaps that

China’s industrial activity is still slowing

restructures after a bailout.
It did not disclose terms of the deal.
AIG will own the 20 per cent of the
group that it did not sell to Fortress,
but said the unit will not be included
in its financial statements. The com-
panies expect the deal to close by the
left it on the hook for tens of billions
of dollars in payouts to some of the
biggest US and European banks.
It has been selling assets to repay
taxpayers, to whom it still owes more
than $100bn.
American General Finance, which GLOBAL ECONOMY sector was partly due to a base effect – suppliers to the sector might be antic-
▲

end of the first quarter of 2011.
Fortress, one of only a few publicly
traded hedge fund groups, was
involved in a similar deal earlier this
year when some of its funds bought
European assets from Ally Financial’s
Residential Capital unit.
It has made other recent acquisi-
tions. It bought bond manager Logan
Circle Partners for $21m and
announced a deal in July for loan
provides loans to people in the United
States, Puerto Rico, the Virgin Islands
and the United Kingdom, has assets
of about $20bn and liabilities of
about $18bn. It reported an operating
loss of $11m for the second quarter
on Friday, compared with a loss of
$202m a year ago. The loss narrowed
because of a drop in the provision for
loan losses due to favorable trends in
credit quality.
CHINESE industrial production
growth slowed for the second consec-
utive month in July, fueling fears that
its economy was losing steam.
Output rose by 13.4 per cent year-
on-year in July. This was slightly
below the 13.7 registered in June and
significantly down on the 16.5 per
cent reading in May.
The cooling off in the industrial
growth was extremely strong this
time a year ago – and withdrawal of
stimulus measures implemented
after the financial crisis.
Authorities in Beijing who have
been trying to slow the housing mar-
ket, might take heart from the data.
There was a sharp slowing in heavy
industry output used for construc-
tion. Mark Williams from consultan-
cy Capital Economics, said that
ipating a slowdown as developers
delay project starts. But fears that the
Chinese government’s plans to shut
inefficient production lines in an
attempt to meet its year-end emis-
sions targets could de-rail industrial
production, might end up being a
damp squib, said Williams. He noted
that similar directives set by the gov-
ernment had been unsuccessful in
the past. INVESTMENT: P17

CITY MOVES | WHO’S SWITCHING JOBS Edited by Victoria Bates in association with

Coutts
The private bank has appointed Jeff
Stubberfield as a commercial banker in its
media banking team, looking after clients in the
music, TV and entertainment business.
Stubberfield has over 15 years of experience
in financial services and joins from Barclays,
where he spent eight years, latterly as a rela-
tionship director managing a portfolio of media
clients across music, TV, talent and booking
agencies and publishing.
Morgan Stanley within the global structured solutions
Cecile Houlot has joined the investment group.
bank as a managing director and head Based in London, Houlot will be
of the European securitisation team responsible for all primary and second-
ary securitisations within the EMEA
region. She joins after 14 years at JP
Morgan, latterly as a managing director
and northern European head of struc-
tured finance derivatives.
Société Générale
SocGen has hired Richard Wolff to its
investment bank as a managing direc-
tor and head of US debt capital mar-
kets syndicate.
Based in New York, Wolff will over-
see the management and growth of the
bank’s US dollar high grade bond syndi-
cate. He joins from Barclays Capital,
where he covered Yankee, industrial,
utility and financial issuers for the US
syndicate desk. Prior to that, he was at
Lehman Brothers.
Insynergy
The investment management firm has
appointed Chris Howard as a discre-
tionary sales manager.
Howard joins with 15 years of asset
management experience, most recently
gained at River and Mercantile. He has
also formerly held senior roles at
Skandia and Credit Suisse.
Altium
Arun George and Philip Dorgan have
joined the broker’s equity research team
to cover technology and retail and e-
commerce respectively.
George joins from Execution Noble,
where he covered software and hard-
ware for the past six years. Dorgan was
previously head of research at Panmure
Gordon and head of the European retail
team at Goldman Sachs.
RSA
The insurer has hired Bobbie Turton and
Matt Poll to its UK affinity division.
Turton becomes partnership director
for pet insurance, having worked at Axa
and Legal and General. Poll was previ-
ously head of sales within Axa’s person-
al lines broker division and becomes a
sales director in RSA’s affinity team.

To appear in CITYMOVES please email your career +44 (0)20 7557 7245
updates and pictures to citymoves@cityam.com SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT morganmckinley.com
 Markets&Investment
16 CITYA.M. 12 AUGUST 2010

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African Barr Gold . . . . . . . . . . . .542.50 –6.50 685.00 520.50 Davis Service . . . . . . . . . . . . . . .375.10 –11.90 442.30 354.00 .LQJÀVKHU . . . . . . . . . . . . . . . . . .204.50 –7.10 255.00 196.50 Scot. & Sthrn Energy. . . . . . . . . 1129.00* –11.00 1206.00 357.50
Aggreko . . . . . . . . . . . . . . . . . .1527.00 –30.00 1639.00 558.50 De La Rue . . . . . . . . . . . . . . . . . .794.00 –3.00 1021.00 725.50 Ladbrokes . . . . . . . . . . . . . . . . .135.60 –3.80 174.29 114.60 Scottish Mortgage. . . . . . . . . . . .581.50 –14.00 623.50 439.70
Alliance Trust . . . . . . . . . . . . . . .312.00 –7.60 352.70 281.00 Debenhams . . . . . . . . . . . . . . . . .59.40 –1.50 91.65 51.95 Lancashire Hldgs . . . . . . . . . . . .515.00 –1.50 545.00 416.70 SEGRO . . . . . . . . . . . . . . . . . . . .273.90 +0.10 403.10 244.00
AMEC . . . . . . . . . . . . . . . . . . . . .875.50 –25.00 937.00 693.50 Derwent London . . . . . . . . . . . .1378.00 –8.00 1490.00 1044.00 Land Securities . . . . . . . . . . . . . .604.00 –8.50 743.50 543.00 Serco . . . . . . . . . . . . . . . . . . . . .543.50 +0.50 656.50 405.10
Amlin . . . . . . . . . . . . . . . . . . . . .418.60 –6.10 436.20 336.30 Dexion Absolute . . . . . . . . . . . . .138.00 +1.00 148.00 121.10 Legal & General . . . . . . . . . . . . . .87.65 –2.25 94.70 61.50 Severn Trent . . . . . . . . . . . . . . .1323.00 –21.00 1358.00 929.50
Anglo American . . . . . . . . . . . .2358.00 –115.50 3015.50 1777.50 Diageo . . . . . . . . . . . . . . . . . . .1096.00 –6.00 1176.00 921.50 Lloyds Banking Gp . . . . . . . . . . . .70.03 –5.09 77.61 45.30 Shaftesbury . . . . . . . . . . . . . . . .401.70 –3.30 426.50 341.70
Antofagasta . . . . . . . . . . . . . . . .989.50 –31.50 1100.00 680.00 Dimension Data . . . . . . . . . . . . .121.40 –0.20 125.50 55.00 Logica . . . . . . . . . . . . . . . . . . . . 112.70 –4.20 149.10 100.80 Shire. . . . . . . . . . . . . . . . . . . . .1487.00 –11.00 1526.00 984.50
Aquarius Platinum . . . . . . . . . . .256.20 –3.80 490.00 211.50 Domino’s Pizza . . . . . . . . . . . . . . 411.00* –9.00 431.30 229.00 London Stk Exchange . . . . . . . . .658.50* +0.50 949.50 540.50 Smith & Nephew . . . . . . . . . . . . .573.00 –1.50 700.50 465.80
ARM Holdings . . . . . . . . . . . . . . .305.80 –11.20 370.00 120.50 Drax . . . . . . . . . . . . . . . . . . . . . .379.90 –5.10 496.50 321.50 Lonmin . . . . . . . . . . . . . . . . . . .1505.00 –55.00 2198.00 1330.00 Smiths . . . . . . . . . . . . . . . . . . . 1193.00 +45.00 1242.00 764.00
Arriva . . . . . . . . . . . . . . . . . . . . .772.00 — 782.50 428.20 DSG Intl . . . . . . . . . . . . . . . . . . . .25.13 –1.33 39.75 23.32 Man . . . . . . . . . . . . . . . . . . . . . .212.40 –10.50 373.60 199.60 SOCO Intl . . . . . . . . . . . . . . . . . .453.70 –11.90 476.60 380.60
Ashmore . . . . . . . . . . . . . . . . . . .282.00 –3.10 311.20 211.60 Dunelm . . . . . . . . . . . . . . . . . . . .395.00 –2.50 438.40 250.70 Marks & Spencer. . . . . . . . . . . . .330.00 –12.10 412.70 321.90
Astrazeneca . . . . . . . . . . . . . . .3273.50* –74.50 3376.00 2668.00 Easyjet . . . . . . . . . . . . . . . . . . . .364.00 –15.90 499.90 308.30 Meggitt . . . . . . . . . . . . . . . . . . . .268.00 –12.50 331.00 189.90 Spectris . . . . . . . . . . . . . . . . . . .898.00 –32.50 949.00 561.00
Atkins(Ws) . . . . . . . . . . . . . . . . .765.50 –23.50 801.00 532.50 Edinburgh Inv Tst . . . . . . . . . . . .396.00 –7.50 412.40 315.60 Melrose . . . . . . . . . . . . . . . . . . .226.70 –4.80 251.50 122.90 Spirax-Sarco Eng . . . . . . . . . . .1532.00 –23.00 1617.00 929.00
Autonomy Corp . . . . . . . . . . . .1582.00 –54.00 2012.00 1229.00 Electrocomponents . . . . . . . . . . .212.40 –9.60 245.00 142.90 Mercantile IT . . . . . . . . . . . . . . . .944.00 –23.00 1002.00 822.50 Spirent Comms . . . . . . . . . . . . . .130.60 –2.20 135.90 68.55
Aveva . . . . . . . . . . . . . . . . . . . .1330.00 –10.00 1375.00 805.00 EnQuest . . . . . . . . . . . . . . . . . . . 112.00 –1.00 121.40 87.35 Michael Page Intl. . . . . . . . . . . . .387.90 –9.00 461.50 289.10 SSL Intl . . . . . . . . . . . . . . . . . . . 1158.00* –4.00 1190.00 522.50
Aviva . . . . . . . . . . . . . . . . . . . . .371.20 –14.00 474.00 290.20 Essar Energy . . . . . . . . . . . . . . .392.60 –10.80 475.90 358.50 Micro Focus . . . . . . . . . . . . . . . .300.00 –119.00 550.00 280.10 St James’s Place . . . . . . . . . . . . .274.20* –10.30 296.90 194.40
Babcock International . . . . . . . . .542.50 –15.50 660.50 473.80 Eurasian Nat Res . . . . . . . . . . . .935.00 –30.50 1276.00 731.00 Millen & Copthorne . . . . . . . . . . .481.10 –7.90 514.50 297.90 Stagecoach. . . . . . . . . . . . . . . . .161.10 –6.40 204.90 126.20
BAE Systems . . . . . . . . . . . . . . .317.00 –9.90 389.90 294.20 Euromoney Inst Inv . . . . . . . . . . .607.50 –7.50 630.00 245.00 Misys . . . . . . . . . . . . . . . . . . . . .259.00 –6.00 281.70 173.90 Standard Chartered . . . . . . . . . .1748.00 –83.00 1927.00 1340.00
Balfour Beatty . . . . . . . . . . . . . . .259.10 –3.80 328.85 228.60 Experian . . . . . . . . . . . . . . . . . . .621.50 –12.50 664.50 489.00 Mitchells & Butlers . . . . . . . . . . .303.30 –12.50 343.90 228.30 Standard Life . . . . . . . . . . . . . . .208.60 –7.80 237.00 170.00
Barclays . . . . . . . . . . . . . . . . . . .313.60 –20.05 394.25 253.40 F&C Comm Prop . . . . . . . . . . . . . .89.50 +1.50 96.80 79.00 MITIE . . . . . . . . . . . . . . . . . . . . .198.20* –7.70 281.70 195.20 SuperGrp . . . . . . . . . . . . . . . . . .953.00 –23.00 1030.00 499.00
Barratt Development . . . . . . . . . . .97.50 –3.90 193.31 89.10 Ferrexpo . . . . . . . . . . . . . . . . . . .282.30 –19.50 396.20 138.00 Mondi . . . . . . . . . . . . . . . . . . . . .461.30 –7.80 488.00 262.30 TalkTalk . . . . . . . . . . . . . . . . . . .123.50 –2.90 147.10 106.60
BBA Aviation . . . . . . . . . . . . . . .189.50 –10.10 220.00 136.60 FirstGroup . . . . . . . . . . . . . . . . .355.20* –12.60 448.80 331.20 Monks Inv Tst . . . . . . . . . . . . . . .290.00 –4.70 321.20 240.00 Talvivaara Mining . . . . . . . . . . . .405.20 –19.90 501.50 341.40
Beazley. . . . . . . . . . . . . . . . . . . . 115.40* –1.60 125.80 95.25 Foreign & Col Inv Tst. . . . . . . . . .268.50 –6.00 297.20 229.50 Morrison Wm . . . . . . . . . . . . . . .277.30 –2.20 306.30 255.00 Tate & Lyle . . . . . . . . . . . . . . . . .435.40 –4.80 509.00 368.70
Bellway. . . . . . . . . . . . . . . . . . . .587.00 –19.50 927.50 554.00 Fresnillo . . . . . . . . . . . . . . . . . .1022.00 –40.00 1139.00 539.50 Murray Intl Tst . . . . . . . . . . . . . . .845.00* –11.00 893.50 632.00
Berkeley . . . . . . . . . . . . . . . . . . .797.50 –7.50 989.50 735.00 G4S . . . . . . . . . . . . . . . . . . . . . .261.00 –3.40 285.70 209.40 National Express. . . . . . . . . . . . .222.00 –10.50 258.60 155.86 Taylor Wimpey . . . . . . . . . . . . . . .29.76 –0.99 54.90 24.29
BG . . . . . . . . . . . . . . . . . . . . . .1003.50* –16.00 1248.00 966.90 Genesis Emerging Mkts Fd . . . . .466.00 –5.00 484.00 370.00 National Grid . . . . . . . . . . . . . . .533.00* –5.50 607.65 474.80 Telecity . . . . . . . . . . . . . . . . . . . .439.00 –2.00 458.90 311.30
BHP Billiton . . . . . . . . . . . . . . .1925.00 –66.50 2346.00 1481.00 GKN . . . . . . . . . . . . . . . . . . . . . .138.40 –4.90 155.00 100.20 Next . . . . . . . . . . . . . . . . . . . . .1950.00 –74.00 2360.00 1601.00 Templeton Emrg Mkts . . . . . . . . .540.00 –6.50 598.00 390.00
BlackRock Mining . . . . . . . . . . . .557.50 –17.50 654.50 413.00 GlaxoSmithKline . . . . . . . . . . . . 1165.50* –11.50 1347.00 1088.00 Northumbrian Water . . . . . . . . . .322.00 –16.30 341.30 219.90 Tesco . . . . . . . . . . . . . . . . . . . . .401.35 –4.90 454.90 361.20
Bluecrest Allblue GBP . . . . . . . . .166.10 +0.10 167.90 136.20 Great Portland Estates . . . . . . . .312.00 +1.80 332.10 236.60 Old Mutual . . . . . . . . . . . . . . . . .123.10 –3.40 130.20 85.80 Thomas Cook . . . . . . . . . . . . . . .180.20 –3.70 277.20 172.30
Booker . . . . . . . . . . . . . . . . . . . . .43.25 –0.50 49.50 33.00 Greene King . . . . . . . . . . . . . . . .417.90 –17.10 504.00 372.50 Pace . . . . . . . . . . . . . . . . . . . . . .210.00 –2.20 243.80 145.00 Tomkins . . . . . . . . . . . . . . . . . . .322.00 –0.40 325.70 155.00
BP . . . . . . . . . . . . . . . . . . . . . . . 411.00 –8.35 658.20 296.00 Halfords . . . . . . . . . . . . . . . . . . .453.30 –16.70 562.50 324.00 Partygaming . . . . . . . . . . . . . . . .282.60 –6.00 339.70 205.80 Travis Perkins . . . . . . . . . . . . . . .820.50 –23.50 915.00 647.50
Brit Insurance . . . . . . . . . . . . . . .986.50 –7.00 1017.00 709.00 Halma . . . . . . . . . . . . . . . . . . . . .272.60* –7.30 298.70 186.60 Pearson . . . . . . . . . . . . . . . . . . .984.50 –13.00 1069.00 695.00 TUI Travel . . . . . . . . . . . . . . . . . .190.00 –13.10 313.90 189.40
British Airways . . . . . . . . . . . . . .217.30 –10.10 255.80 161.00 Hammerson . . . . . . . . . . . . . . . .371.80 –4.00 460.30 332.20 Pennon . . . . . . . . . . . . . . . . . . . .579.00 –27.00 613.00 434.40 Tullett Prebon . . . . . . . . . . . . . . .368.10 –13.50 436.20 261.20
British Amer. Tob . . . . . . . . . . .2210.00 –14.00 2335.50 1832.00 Hargreaves Lansdown . . . . . . . .376.90 +0.20 387.00 214.00 Persimmon . . . . . . . . . . . . . . . . .360.70 –12.70 534.50 340.20 Tullow Oil . . . . . . . . . . . . . . . . .1234.00 –37.00 1375.00 979.50
British Empire Tst . . . . . . . . . . . .433.30 –5.10 467.90 338.50 Hays . . . . . . . . . . . . . . . . . . . . . . .91.00 –1.60 119.00 88.05 Petrofac . . . . . . . . . . . . . . . . . .1276.00 –35.00 1372.00 816.00 UK Commercial Prop. . . . . . . . . . .75.20* +0.40 84.90 65.25
British Land . . . . . . . . . . . . . . . .446.80* –7.00 532.00 416.00 Henderson . . . . . . . . . . . . . . . . .133.50 –2.40 157.80 110.60 Petropavlovsk . . . . . . . . . . . . . .1019.00 –29.00 1370.00 601.00 Ultra Electronics . . . . . . . . . . . .1668.00 –7.00 1687.00 1198.00
Britvic. . . . . . . . . . . . . . . . . . . . .478.90 –6.30 518.00 324.80 Heritage Oil. . . . . . . . . . . . . . . . .353.90 –96.10 587.00 349.40 Premier Farnell . . . . . . . . . . . . . .235.40 –6.70 252.60 140.60
Brown(N.) . . . . . . . . . . . . . . . . . .227.20 –10.70 284.30 204.80 Hikma Pharma . . . . . . . . . . . . . .721.00 +2.00 746.00 440.00 Premier Oil . . . . . . . . . . . . . . . .1497.00 –48.00 1610.00 984.00 Unilever . . . . . . . . . . . . . . . . . .1707.00 –26.00 2024.00 1588.00
BSkyB . . . . . . . . . . . . . . . . . . . .708.00 –1.50 732.00 521.00 Hiscox . . . . . . . . . . . . . . . . . . . .354.60 –1.40 369.30 299.60 Provident Financial . . . . . . . . . . .830.50 –5.00 986.00 795.00 United Utilities . . . . . . . . . . . . . .592.00 –9.50 606.00 429.00
BT . . . . . . . . . . . . . . . . . . . . . . .137.80 –8.60 151.00 108.40 Hochschild Mining . . . . . . . . . . .309.00 –3.00 370.60 220.00 Prudential . . . . . . . . . . . . . . . . . .562.00 –20.50 665.00 455.00 Utd Business Media . . . . . . . . . .554.00 –10.00 579.50 408.30
Bunzl . . . . . . . . . . . . . . . . . . . . .683.00 –5.50 784.50 527.00 Home Retail . . . . . . . . . . . . . . . .225.10 –7.10 336.50 208.50 PZ Cussons . . . . . . . . . . . . . . . .340.00 –5.40 373.20 210.10 Vedanta Resources . . . . . . . . . .2357.00 –123.00 2967.00 1616.00
Burberry . . . . . . . . . . . . . . . . . . .832.50 –25.50 891.50 440.20 Homeserve . . . . . . . . . . . . . . . . .476.10 –5.60 488.20 435.40 Qinetiq . . . . . . . . . . . . . . . . . . . . 117.80 –2.80 179.10 113.90 Victrex . . . . . . . . . . . . . . . . . . . 1108.00 –51.00 1320.00 613.50
Cable & Wire Comms . . . . . . . . . .60.00* –1.35 150.00 53.00 HSBC Hldgs . . . . . . . . . . . . . . . .657.50 –12.50 766.80 595.20 Randgold Resources. . . . . . . . .5465.00 +25.00 6600.00 3351.00 Vodafone . . . . . . . . . . . . . . . . . .150.75 –3.35 155.50 124.85
Cable & Wire Wwide . . . . . . . . . . .62.05* –3.10 94.80 61.55 Hunting . . . . . . . . . . . . . . . . . . .525.50 –17.00 659.50 423.20 Reckitt Benckiser . . . . . . . . . . .3065.00* –54.00 3667.00 2694.00 Weir . . . . . . . . . . . . . . . . . . . . .1214.00 –28.00 1275.00 585.00
Cairn Energy. . . . . . . . . . . . . . . .444.80 –15.20 485.30 306.80 ICAP . . . . . . . . . . . . . . . . . . . . . .381.00* –7.80 478.30 291.70 Reed Elsevier . . . . . . . . . . . . . . .530.50* –11.00 566.00 414.00 WH Smith . . . . . . . . . . . . . . . . . .406.10 –11.80 551.00 396.00
Caledonia Invs . . . . . . . . . . . . .1563.00 –27.00 1759.00 1496.00 IG . . . . . . . . . . . . . . . . . . . . . . . .478.90 –6.90 498.90 291.00 Regus . . . . . . . . . . . . . . . . . . . . . .72.70 –0.80 125.50 68.65 Whitbread . . . . . . . . . . . . . . . . .1396.00 –45.00 1645.00 917.00
Capita . . . . . . . . . . . . . . . . . . . . .697.00 –13.00 829.50 643.50 Imagination Tech Gp . . . . . . . . . .339.20 –14.80 358.30 149.75 Renishaw . . . . . . . . . . . . . . . . . .850.00 –34.00 915.50 420.00 William Hill . . . . . . . . . . . . . . . . .166.00 –2.20 217.80 160.50
Capital & Counties . . . . . . . . . . . 112.30 –0.50 125.40 99.60 IMI . . . . . . . . . . . . . . . . . . . . . . .700.00 –19.00 786.00 357.60 Rentokil Initial . . . . . . . . . . . . . . .101.00 –4.00 140.20 94.10 Witan Inv Tst . . . . . . . . . . . . . . . .437.50 –9.70 487.00 365.50
Capital Shopping Centres . . . . . .328.70 –4.90 580.00 300.10 Imperial Tobacco. . . . . . . . . . . .1806.00* +1.00 2159.00 1659.00 Resolution . . . . . . . . . . . . . . . . .248.80 –1.50 264.80 220.10
Carillion . . . . . . . . . . . . . . . . . . .300.00 –11.10 361.90 263.90 Inchcape. . . . . . . . . . . . . . . . . . .284.50 –9.10 347.00 235.00 Rexam . . . . . . . . . . . . . . . . . . . .300.40 –1.90 348.80 232.00 Wolseley . . . . . . . . . . . . . . . . . .1432.00 –46.00 1742.00 1155.00
Carnival . . . . . . . . . . . . . . . . . .2175.00 –51.00 2937.00 1747.00 Informa . . . . . . . . . . . . . . . . . . . .384.40 –9.20 439.40 250.20 Rightmove . . . . . . . . . . . . . . . . .601.50 –23.00 729.00 404.50 Wood Group (John). . . . . . . . . . .353.00 –12.10 411.70 267.70
Catlin . . . . . . . . . . . . . . . . . . . . .364.00 –11.10 394.60 303.20 Inmarsat . . . . . . . . . . . . . . . . . . .702.50 –35.50 831.00 491.00 Rio Tinto . . . . . . . . . . . . . . . . . .3256.00 –131.50 4104.00 2205.00 WPP . . . . . . . . . . . . . . . . . . . . . .676.00 –15.50 744.00 458.80
Centamin Egypt . . . . . . . . . . . . .161.50 –0.10 174.75 80.00 Intercontl Hotels . . . . . . . . . . . .1071.00 –7.00 1244.00 697.50 RIT Capital Partners . . . . . . . . . 1109.00 –26.00 1215.00 913.50 Xstrata . . . . . . . . . . . . . . . . . . .1004.00 –49.00 1344.50 713.00
Centrica . . . . . . . . . . . . . . . . . . .319.70 –4.00 324.40 216.90 Intermediate Capital . . . . . . . . . .261.70* –5.90 332.00 233.50 Rolls Royce . . . . . . . . . . . . . . . .552.00 –8.00 631.50 415.00 LONDON TOP 250 BY MARKET CAPITALISATION
Charter Intl . . . . . . . . . . . . . . . . .641.50 –30.50 855.50 560.50 Intertek . . . . . . . . . . . . . . . . . . .1681.00 –43.00 1745.00 1092.00 Rotork . . . . . . . . . . . . . . . . . . .1437.00 –42.00 1537.00 933.00
Chemring . . . . . . . . . . . . . . . . .2807.00 –37.00 3711.00 1996.00 Intl Personal Fin . . . . . . . . . . . . .238.10 –6.30 283.00 128.25 Royal Bank Of Scot . . . . . . . . . . . .46.00 –2.45 58.95 28.25 * Ex-Dividend † Suspended
Chloride Group . . . . . . . . . . . . . .373.00 –1.00 390.50 138.60 Intl Power . . . . . . . . . . . . . . . . . .364.80 –7.80 384.10 248.20 Royal Dutch Shell A . . . . . . . . .1780.50* –41.00 2068.50 1559.50
Close Bros . . . . . . . . . . . . . . . . .672.50 –15.50 806.50 660.50 Invensys . . . . . . . . . . . . . . . . . . .249.60 –10.40 350.30 234.50 Royal Dutch Shell B . . . . . . . . .1717.00* –40.00 1997.50 1528.00 www.interactivedata.com

UK stocks sag after gloomy US wipes out gains

news from Bank of England on economic fears
would reinvest the money from cerns over global demand for raw costs. However, some traders ques-
THELONDON maturing mortgage bonds it holds
into government debt to counter
materials, with Rio Tinto down 3.9
per cent, Vedanta Resources falling 5 THENEW YORK tioned how effective these measures
would be.

REPORT recent signs of economic weakness.

“Markets have been struggling to
see the positives for the last few days
per cent and Xstrata off 4.7 per cent.
TUI Travel plunged to a 20-month
low after the tour operator warned
REPORT “Adding liquidity to the system by
saying they would buy Treasuries isn't
helping the average man on the
and they have looked vulnerable. that full-year results will be at the street,” said Robert Pavlik, chief mar-

B U
RITAIN’S top share index fell What we have seen in the last 24 lower end of market forecasts, closing S stocks erased the year’s ket strategist at Banyan Partners.
sharply to a three-week low hours has added to concerns that the down 6.45 per cent at 190p. increases in the broadest sell- “This isn’t going to be creating jobs or
closing yesterday, with banks stock market recovery has got ahead The news weighed on travel peer off in a month-and-a-half yester- helping the housing market.”
and commodity stocks leading of the real recovery,” said David Jones, Thomas Cook, down 2.0 per cent. day, as fears of sustained global There were more than five times as
a broad-based sell-off after US and UK chief market strategist at IG Index. British 10-year gilt yields, however, economic stagnation caused investors many declining stocks as advancing
central banks voiced concerns over The Office for National Statistics hit a 16-month low below 3.12 per to flee to safer assets. ones on the New York Stock Exchange
the economic recovery. said yesterday the number of people cent. That compared with a dividend All three major indexes posted while on the Nasdaq, more than eight
Technology firm Smiths Group, claiming jobless benefit fell in July, of 3.4 per cent for the FTSE 100. their worst percentage drop since 16 stocks fell for each that rose.
however, topped the list of a handful though the pace of improvement is The handful of rising shares includ- July following the Federal Reserve’s Only five of the S&P’s 500 stocks
of gainers, up 3.9 per cent as traders unlikely to be maintained once gov- ed Randgold, Serco, Imperial Tobacco bleaker assessment of the economy ended higher. All 10 major S&P sec-
cited break-up hopes of the company ernment spending cuts kick in, lead- and Segro, up between 0.04 and 0.46 on Tuesday. tors were down more than one per
after Tuesday’s UBS note. ing to public sector job losses tipped per cent apiece. Volumes on the FTSE The Dow Jones industrial average cent, led lower by the industrials,
UBS reiterated a “buy” rating on to exceed half a million. 100 were 91 per cent of the 90-day was down 265.42 points, or 2.49 per down 3.9 per cent, and the financials,
Smiths Group, saying after its suc- Economy sensitive banks were daily average, in a slight uptick on cent, at 10,378.83. The Standard & off 3.6 per cent. Diversified manufac-
cessful restructuring the firm “will among the top losing sectors in the previous days. Poor’s 500 Index was down 31.59 turer 3M was the biggest drag on the
ultimately be broken up”. UK, down 3.8 per cent. Lloyds points, or 2.82 per cent, at 1,089.47. Dow, off 3.5 per cent.
The FTSE 100 closed 131.20 points Banking Group dropped 6.8 per cent, ANALYSIS l FTSE The Nasdaq Composite Index was Among the Nasdaq’s top decliners
lower, or 2.4 per cent at 5,245.21 after while Barclays, which also traded ex- 5,245.21 down 68.54 points, or 3.01 per cent, at was Cisco Systems, which fell 2 per
falling 0.6 per cent in the previous dividend, fell 6 per cent.
5,500 11 Aug 2,208.63. cent to $23.73 during the session,
5,400
session. It was the index’s biggest sin- “The whole point of quantitative The Nasdaq was down 2.7 per cent then slumped a further 7.9 per cent to
5,300
gle-day percentage drop since 29 easing is that it is trying to fix a very for the year, while the S&P 500 was $21.85 in extended trading after the
June. Other major European indexes serious problem. There are two ways 5,200 down 2.3 per cent and the Dow was company reported weaker-than-
also finished sharply lower. of looking at it: Is it a cure? Or does it 5,100 down 0.5 per cent. The CBOE expected revenues.
The Bank of England said that eco- reflect significant underlying prob- 5,000 Volatility Index surged 13 per cent, Volume was light, with about
nomic prospects were “highly uncer- lem?” said Geoff Wilkinson, head of 4,900 suggesting investors see further chop- 8.52bn shares traded on the New York
tain” and that more quantitative investment research at Mint 4,800 piness in the market. Stock Exchange, the American Stock
easing may be needed, while the Securities. 4,700 The US central bank said it would Exchange and Nasdaq, well below last
Federal Reserve said on Tuesday it Miners shed 3.8 per cent on con- 17 May 7 Jun 25 Jun 15 Jul 4 Aug take steps to hold down borrowing year's estimated daily average.
CITYA.M. 12 AUGUST 2010
Pressures are building
for a stronger renminbi
A growing trade differential with the US could spur the Chinese
authorities to speed up currency appreciation, writes Kathleen Brooks
A
T THE start of this year, China
was considered the only hope for
global growth. But, for investors
who wanted to get a slice of the
pie and piled into the stock market, it
has been a frustrating time.
The Shanghai Composite Index is one
of the worst-performing global stocks
markets, having lost nearly a fifth of its
value since the start of this year.
It is difficult to pin down exactly what
has caused its dismal performance.
Growth has certainly moderated, but
most analysts now think that China will
have the “perfect” slowdown: the econo-
my won’t overheat and inflation will
remain contained. The latest economic
data signal just that: there are signs of
weakness, but things aren’t falling off a
cliff. Industrial output growth dropped
to 13.4 per cent in July on an annualised
basis and retail spending slid to 17.9 per
cent, down from 18.3 per cent in June.
These are growth rates the western
world can only dream of. So should
investors go long of the Chinese stock
market from here? No, says Martin
Arnold, a senior research analyst at ETF
Securities. He says that investors should
consider the renminbi as an alternative
investment to Chinese stocks: “There are
some pitfalls for investors in the stock
market. There is less transparency in
the corporate environment compared to
the west and stocks are more volatile.”
Arnold says that foreign exchange is a
purer way to access China’s macro eco-
nomic prospects. And after the
announcement from Beijing that it will
re-value the currency – it has operated a
de facto peg to the dollar since 2008 –
investors could be looking at a 20 per
cent appreciation of the renminbi
against the dollar over the next five
years. Both HSBC and ETF Securities
offer investors exposure to the renmin-
bi; a return of 5 per cent per year is pret-
ty good when cash rates in the UK are at
0.5 per cent.
And now could be an opportune time
to make the investment. China’s well-
publicised trade surplus with the US is
gaining even more ground. It stood at
$26.2bn in June, up from $22.3bn in
May. UBS economist Tao Wang says that
this will increase pressure on the
Chinese authorities: “we think the
strong export performance would pro-
vide support for allowing the renminbi
to appreciate somewhat faster in the
next month or two, by 2-3 per cent
against the US dollar.”
Riding the coat tails of China’s
growth and ditching stocks in favour of
the currency, could offer good returns.
LISTED PRODUCT NEWS
KATHLEEN BROOKS
ETF investors have been nimble when trading wheat
ETFS BENEFIT FROM WHEAT SURGE
The well-publicised jump in wheat prices in
recent days has not escaped the notice of
ETF investors. According to ETF Securities,
its global agri-business fund rallied 7 per cent
last week, topping its ETFX platform. Returns
from its agriculture fund actually beat its
gold fund, which returned 5 per cent over the
week. However, investors have been nimble.
ETF Securities has seen record shorting
interest in wheat this week, as investors
doubt whether the spike higher in grains will
last. Likewise, investors have also reduced
Picture: SXC their exposure to oil funds.
Investment | Listed products
Renminbi appreciation is back on the cards
FOOD AND BEVERAGES OUT OF FAVOUR
According to the latest flow data from
iShares, there were $296.3m net inflows to
Eurostoxx 600 sector ETFs last week. The
banking sector along with basic resources
and minerals experienced the largest net
inflows. While the food and beverage sector
experienced net outflows to the tune of
$37.2m. The media sector has attracted the
largest net inflows since the start of the year,
with $235.7m. ETFs remain deeply popular.
The $9.2bn of ETFs invested in Eurostoxx
beats the $3.8bn invested in the open interest
futures contracts for all sectors.
17
Picture: REUTERS
THE
TIPSTER
TIME FOR THE PRU’S
STOCK PRICE TO SHINE
P
RUDENTIAL shares have been trading
in a range between 600p and 500p
for the past six months. However,
after languishing around the 500p
mark, the stock has risen more than 15 per
cent in the past three weeks to highs of
603.5p in anticipation of a positive first-half
trading report today. Shares fell away
slightly yesterday, but traders have been
continuing to buy the stock in anticipation
of further long-term gains. Spreadex has a
December-based contract for Prudential
with a spread of 568.9p-573.5p.
In the past 12 months shares in Aveva
Group have risen from 800p to highs of
1,375p last week. The share price has fallen
back to around the 1,340p level this week.
But news of deals with the Bangkok Dock
Company and Indian-based SKA Marine
Services to share their resources, sparked a
mini rally in the stock. ShortsandLongs.com
has a rolling spread of 1,330p-1,336p.
Only a week after the bank announced a
29 per cent rise in profit, news of job cuts
at Barclays Capital saw the share price
drop 5 per cent yesterday. With a tougher
regulatory environment and lower risk
appetite, the investment banking arm of
the business is likely to continue to suffer.
Cantor Index offers a spread of 314.60p–
315.63p.
The Bank of England’s inflation report
saw the Bank’s growth forecast for the UK
economy fall to 3 per cent for 2011.
Inflation will remain above the 2 per cent
target for this year, the Bank said, before
slowing sharply in the second half of 2011.
This data weighed on sterling, as investors
priced in the prospect of a prolonged peri-
od of low interest rates. IG Index’ current
spot price for sterling-US dollar is
$1.5655-$1.5658.
Numis, the investment bank and broker,
upgraded Balfour Beatty, the construction
firm, to a buy after impressive interim
results released yesterday. Its services sec-
tor should continue to perform well.
Spreadex offers a rolling spread of 258.3p-
259.8p.
Kathleen Brooks
DE-MYSTIFYING THE FTSE 100
Yesterday’s Bank of England inflation report
was particularly downbeat about the
prospects for growth in the UK. However, the
FTSE 100 index remains ten per cent off the
lows reached in May. Is this rally going to
last, or will a slower growth outlook de-rail
further FTSE gains? To get a better grip on
where the UK market is going, RBS is holding
a seminar hosted by David Stevenson. It will
look at whether the FTSE 100 is offering
good value at the moment. The seminar takes
place on 19 August from 5.30pm-7pm, at
RBS’s offices on 250 Bishopsgate, London.
 Lifestyle
18
Let
the game
begin
The Glorious 12th means shots
ringing out across the British
countryside, says Timothy Barber
T
HE City can seem a pretty quiet place
at this time of year – for the action,
you need to head to the countryside.
“Glorious” August 12 being the start
of the game season, keen shots will today
be filling their hip flasks, pulling on wellies
and heading up in their droves to the high
moors of the north of England and
Scotland to down the first grouse of the
year. Over the next few months ptarmigan,
snipe, partridge, duck, woodcock and –
most popularly – pheasant will be coming
into season and subsequently finding their
way to cooking pots and restaurant tables
around Europe.
It hasn’t been an easy couple of
years for the shooting indus-
try. Thanks to the recession
bookings for shoots were
down across the country last
year, while this year’s particu-
larly bitter winter looked like decimat-
ing grouse populations, adding to
the misery. However, the news is
good. A strong grouse breeding sea-
son has meant numbers of young are
looking healthy, while bookings for the
shoots over the season are recovering from
last year’s dip.
“It’s certainly looking much healthier
this year,” says Chris Horne, director of
Guns on Pegs (www.gunsonpegs.com), an
online service for booking shoots. “Despite
the recession it’s a sport that’s growing in
popularity – it’s not a closed world of aristo-
crats and super rich anymore.”
In fact, it’s anything but. In the past nine
years The British Association of Shooting
and Conservation (BASC) has increased its
membership from 105,000 to 130,000.
According to the association, 480,000 peo-
ACCESSORIES TO GO WITH THAT BIG GUN OF YOURS...
2 6
1 7
CITYA.M. 12 AUGUST 2010
| Shooting
ple shoot live quarry annually in the UK,
while shooting contributes £1.6bn to the
economy every year.
“Being a gameshot on a reasonably sized
shoot costs no more than membership of a
good golf club,” says Christopher Graffius,
the association’s spokesman. “That money
sustains the rural economy and the conser-
vation of the landscape.”
Graffius advises anyone wanting to
experience that thrill for the first time to
get used to clay pigeon shooting first –
clay facilities around London include the
West London Shooting School in
Northold, Bisley Shooting Ground in
Surrey and gunmaker Holland &
Holland’s shooting ground in Ruislip.
“They’ll turn you into a competent shot,
and you’ll also find opportunities to go on
shoots through them.”
Once you’re a competent shot, you can
think about acquiring a gun. New, mass-
produced shotguns from makers like
Browning and Berretta can be bought for
around £1,500. But for something to real-
ly make you the envy of your shooting
party, it’s worth
investing in some-
thing custom-
made. You can
either get these
second hand or have
them made to your own specifications. A
brand new gun by the likes of Holland &
Holland or Mayfair’s William & Son can cated (and therefore more prestigious and,
cost tens of thousands of pounds, but of course, pricey) sidelock. Length of bar-
there’s nothing else like it. rel, type of grip, the spread – or “pattern”
“You’ve got a unique item that’s com- – of shot after it leaves the barrel, even the
pletely bespoke and handmade,” says Paul piece of wood which becomes the stock
West, gun-maker at William & Son. “It’s are all things to be decided in a session
fitted to you and decorated with beautiful with a gun-fitter, who will also assess your
engravings, and it’ll last for decades.” posture and shooting style.
When buying a gun you’ve got lots of “It’s a similar process to choosing a
options to consider. You can go for an over- bespoke suit,” says Daryl Greatrex, manag-
and-under (one barrel on top of the other) ing director of Holland & Holland. “Then
or a side-by-side – the latter is considered you’ll have upwards of 20 people involved
the quintessential English gun. You can in the making of each bespoke gun.”
choose different kinds of firing mecha- Now that’s got to be something worth
nism – the boxlock, or the more compli- trudging up a moorland to put into action.
4
8
1. SILVER HIP FLASK www.williamandson; 2. HUNTER FLASK
SET £95, www.davidlinley.com 3. CARTRIDGE BELT www.ray-
ward.co.uk 4. SWAROVSKI BINOCULARS www.williamandson;
5. SLOE GIN DRINKING CUPS £850, www.hollandandholland.com
6. PELTOR EAR DEFENDERS £145, www.williamandson 7. GUN
3 5 SLIP £260, www.williamandson, 8. DOUBLE GUN SLIP £1,700,
www.rayward.co.uk
CITYA.M. 12 AUGUST 2010 LEARNING FROM 19
BP’S MISTAKES
SEE TODAY’S CAREERS
SECTION, OVER PAGE

WHERE TO EAT GROUSE IN LONDON

Pictures: GETTY, REX

Launceston Place Brooks red burgundy wine. 15 Eccleston

Expect to find grouse breasts served with a
fresh onion puree, spring onions, baby gem
lettuce and wild flowers for a summery take.
Whole poached pheasant and partridge will
be coming later in the autumn. 1a Launceston
Place, W8 5RL
www.launcestonplace-restaurant.co.uk
Prism Brasserie
The grand City restaurant will be serving
roast grouse from next Monday with braised
artichokes, creamed curly kale, sauteed baby
onions and bacon, game chips and truffled
bread sauce. 147 Leadenhall Street, EC3V
4QT www.harveynichols.com
Boisdale of Belgravia
The clubby home of old-fashioned, Scottish-
flavoured luxury is running a £27.50 deal for
roast grouse with a glass of Justerini and
Street, SW1W 9LX www.boisdale.co.uk
Racine
A French take on grouse at Knightsbridge's
smart fine dining establishment, with chef
patron Henry Harris plating up roast grouse
with armagnac gravy, bread sauce and a foie
gras crouton (£27) from 7pm this evening.
239 Brompton Road, SW3 2EP
www.racine-restaurant.com
The Square
Grouse arrives on the menu at The Square
from this evening. The dish features roast
breast of grouse with a croustillant of the leg,
crushed turnips and blackberries. 6-10
Bruton Street, W1J 6PU
www.squarerestaurant.com
Le Pont de la Tour
You'll find roasted crown of grouse with foie
gras pomme puree, girolles and whole grain
mustard jus at the Southbank restaurant
from tomorrow. Butler's Wharf, 36 Shad
Thames, SE1 2YE, www.lepontdelatour.co.uk

Oxo Tower Restaurant

Browning William & Son Grouse is served Scottish-style from 7pm
A second hand pair of Brand new pair of side- tonight, with haggis, swede, turnip and pota-
Browning C2S sideplate, by-side guns made by to..Oxo Tower Wharf, Barge House St,
20 gauge over-and-under Paul West and his team, London, South Bank SE1 9PH
shotguns, with an elabo- with an elegant Arts & www.harveynichols.com
rate engraving of pheas- Crafts-style scroll pat-
ants in flight. tern. £80,000 (or
£32,000 £40,000 for a single
www.rayward.co.uk gun).
www.williamandson.com
A Free Online
Shoot Broking
Service!
Thousands of Grouse,
Pheasant & Partridge
Days Available...

James Purdey
& Son
A pair of 28 bore single
trigger, side-by-side guns The UK’s No1
made in 2007. Engraved Shoot Finder
with a game scene in a
decorative scroll border.
£160,000.
www.rayward.co.uk

www.gunsonpegs.com
BUY AND SELL SHOOTING ONLINE
 20 Lifestyle | TV& Games CITYA.M. 12 AUGUST 2010

BBC1 BBC2 ITV1 CHANNEL4 FIVE TV PICK

TERRESTRIAL
6pm BBC News
6.30pm BBC London News
7pm The One Show
7.30pm EastEnders; BBC News
8pm Celebrity MasterChef
9pm Mistresses
10pm BBC News
10.25pm Regional News
10.35pm Inside Sport: The
Princess Royal at 60
11.15pm FILM The
Gingerbread Man 1998; Holiday
Weatherview
1.10am Sign Zone: Panorama
1.40am Sign Zone: Countryfile
2.35am Sign Zone: Celebrity
MasterChef 3.35am Sign Zone: Put
Your Money Where Your Mouth Is
4.20am-6am BBC News
6pm Eggheads
6.30pm Restoration Roadshow
7pm The Culture Show at the
Edinburgh Festival: New series.
Highlights from the event,
featuring comedy stars
recalling their Fringe debut.
8pm Natural World: A rare sea
otter pup growing up on the
coast of California.
9pm Victorian Pharmacy
10pm Getting On
10.30pm Newsnight; Weather
11.20pm Nurse Jackie
11.50pm Nurse Jackie
12.15am The Culture Show at
the Edinburgh Festival
1.15am BBC News 4.20am-6am
Close
6pm London Tonight 6pm The Simpsons 6pm The Boss Is Coming to
6.30pm ITV News 6.30pm Hollyoaks Dinner
7pm Emmerdale 7pm Channel 4 News 6.25pm Don’t Stop Believers
7.30pm Where Does All Our 7.55pm 4thought.tv 6.30pm Live from Studio Five
Water Go?: Tonight 8pm Location, Location, 7pm Five News at 7
8pm Emmerdale Location: Kirstie Allsopp and 7.30pm Fifth Gear; Five News
8.30pm Coronation Street Phil Spencer revisit two couples Update
9pm CHOICE Police, Camera, in Hastings. 8pm Giant Aircraft
Action! 9pm Undercover Boss Transporter: Megastructures;
10pm ITV News at Ten 10pm Big Brother Five News at 9
10.30pm London News 11.15pm Coming Up: Would 9pm CHOICE The Hotel POLICE, CAMERA, ACTION!
10.35pm FILM The Grudge: Like to Meet Inspector ITV1, 9PM
Horror remake, starring Sarah 11.45pm CHOICE Coming Up: 10pm FILM Last Man Standing Gethin Jones investigates the dangers
1996. 12.10am Don’t Stop Believers
Michelle Gellar. 2004. Half Term posed by drivers’ bad habits behind the
12.15am SuperCasino 4am The
12.20am The Zone; ITV News 12.15am Dirty Sexy Money Boss Is Coming to Dinner 4.25am
wheel, including texting, putting on
Headlines 1.05am The Ascent of Money 2am Wildlife SOS 4.50am Rough Guide make-up and talking on mobile phones.
2.20am British Touring Car FILM Apres Vous: Premiere. to Journeys 5.05am The New
Championship 3.35am-5.30am ITV Comedy, with Daniel Auteuil. 2003. Tomorrow 5.30am-6am Michaela’s
Nightscreen 3.50am-6.10am Big Brother: Live Wild Challenge

SKY SPORTS 1 Championships: Pool Talk 8pm 4.40am Maury 5.30am-6am 11.55pm The Big Bang Theory DISCOVERY HOME &
SATELLITE & CABLE

6pm Live USPGA Championship
Golf 1am Golfing World 2am
Carling Cup Football 3am
Premier League World 3.30am
Golfing World 4.30am Carling
Cup Football 5.30am-6am
Premier League World
SKY SPORTS 2
7pm NRL Fulltime 7.30pm Live
Championship Rugby League
9.30pm Super League’s
Supermen 10pm Live Poker
12am NRL Fulltime 12.30am-
2.30am Championship Rugby
League
SKY SPORTS 3
4pm Live ECB 40 League Cricket
9.30pm WWE: Late Night –
Raw 11.30pm WWE: NXT
12.30am WWE Special 1.30am-
2am IAAF Athletix Weekly
BRITISH EUROSPORT
7pm International Football
7.45pm European Aquatics
Live WTA Tennis 9.45pm
Triathlon 10.40pm Strongest
Man 11.40pm Swimming
12.25am-12.40am European
Aquatics Championships: Pool
Talk
ESPN
6.30pm Premier League Football
8pm French Top 14 Rugby Union
9pm Goal! 9.30pm Superleague
Formula 10pm MMA Live
10.45pm Major League Soccer
12.30am Press Pass 2010 1am
Major League Baseball 4am
MMA Live 4.45am-5am ESPN
Boxing: Short Stories
LIVING
7pm Four Weddings 8pm
Britain’s Pushiest Parents 9pm
Criminal Minds 10pm Private
Practice 11pm Criminal Minds
12am CSI: Crime Scene
Investigation 1am Charmed
3am Passport Patrol 3.50am
The Jerry Springer Show
Home Shopping
BBC THREE
7pm Total Wipeout 8pm Young,
Dumb and Living Off Mum 9pm
Beckii: Schoolgirl Superstar at
14 10pm EastEnders 10.30pm
The Real Hustle: Celebrity
Scammers 11pm Family Guy
11.45pm Beckii: Schoolgirl
Superstar at 14 12.45am Baby
Beauty Queens 1.15am Tulisa –
My Mum and Me 2.15am Total
Wipeout 3.10am The Real
Hustle: Celebrity Scammers
3.40am Young, Dumb and
Living Off Mum 4.40am-
5.10am Baby Beauty Queens
E4
7pm Hollyoaks 7.30pm Friends
9pm The Big Bang Theory
9.30pm How I Met Your
Mother 10pm Accidentally on
Purpose 10.35pm Alan Carr:
Chatty Man 11.25pm Important
Things with Demetri Martin
12.25am-6am Big Brother: Live
HEALTH
HISTORY 7pm Extreme Pregnancy 8pm
7pm Conquistadors 8pm Pawn 10 Years Younger 9pm I Didn’t
Stars 9pm Inside the World of Know I Was Pregnant Specials:
Henry VIII 10pm True Horror: Cradle Will Rock 10pm I’m COMING UP: HALF TERM
Addicted To Plastic Surgery
Dracula 11pm Hell’s Battlefield CHANNEL 4, 11.45PM
12am Pawn Stars 1am Inside 11pm Dr G: Medical Examiner
12am I Didn’t Know I Was Fifteen-year-old Malik begins to
the World of Henry VIII 2am
Pregnant Specials: Cradle Will suspect his brother might be a
Conquistadors 3am Britain AD: potential suicide bomber. Drama, with
Rock 1am I’m Addicted To
King Arthur’s Britain: Post- Terry Haywood and James Burrows.
Plastic Surgery 2am Dr G:
Roman Britain. 4am-5am The Medical Examiner 3am 10 Years
Universe Younger 4am Extreme
Pregnancy 5am-6am Bringing
DISCOVERY Home Baby
8pm How Do They Do It?
8.30pm How It’s Made 9pm SKY1
Venom Hunter with Donald 7pm The Simpsons 8pm The
Schultz 10pm River Monsters Real A&E 8.30pm Real Filth
11pm Oil, Sweat and Rigs 12am Fighters 9pm Lie to Me 10pm
Deadliest Catch: 1am Bear NCIS: Los Angeles 12am Road
Grylls: Born Survivor 2am More Wars 1am UK Border Force THE HOTEL INSPECTOR
Industrial Revelations Europe 1.50am Road Wars 2.40am FIVE, 9PM
3am Weaponology 3.50am Oops TV 3.30am The 4400 Alex Polizzi visits a hotel in South
Swamp Loggers 4.40am Days 4.20am Project Runway Yorkshire, where owners have estimat-
That Shook the World 5.30am- 5.10am-6am Are You Smarter ed they have six months to reverse
6am How Does That Work? Than a 10 Year Old? their fortunes before going bankrupt.

COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk

QUICK CROSSWORD
   

SUDOKU KAKURO
9 13 34 7 21 17 42 21 
23 18

11 32
Place the numbers from 1 to 9 in each empty cell so that each 14 
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 22 13
13
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 15 18
 
above or to the left of it. 14 28 23 8
You can only use the digits 1-9 7 35     
 and you must not use the
25
16 12 10 
same digit twice in a block. 11 31
      The same digit may occur 16 9  
3
   more than once in a row or
column, but it must be in a 24
22
6
8
8 20

9 28
   separate block.
11 
17 19
  33 10


   ACROSS Down
1 Plant with spiny 1 Group of coral islands
  
WORDWHEEL bracts (6) in Micronesia (6)
6 Quantity (6) 2 Exceedingly sudden
      D X 7 Fluctuate (4) and unexpected (6)
Using only the letters in the Wordwheel, you have 3 Cobbler’s stand (4)
 ten minutes to find as many words as possible,
I B 8 A forward on a
4 Small rectangular block used
soccer team (7)
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters E 9 Lick up (3)
11 Wavelengths
in playing a game; the face of
each having two equal areas
LAST ISSUE’S or more, all must contain the central letter and
letters can only be used once in every word. There
N R shorter than
bearing up to six dots each (6)
5 Whole number (7)
SOLUTIONS KAKURO is at least one nine-letter word in the wheel.
T O
light but longer
than X-rays (11) 8 Bathing resort (3)
16 Be nosey (3) 10 Court-ordered support paid
QUICK CROSSWORD 1 8 1 4 3 7 by one spouse to another (7)
& 2 9 ( 1 0 $ 1 * 2
3 9 5 3 4 8 9 SUDOKU         
17 Strong
feeling (7) 12 The selling of goods
3 5 2 3 2 4 1         
8 ( ( 6 :
19 Follower of to consumers (6)
3 1 9 8 6 5 9 7
5 ( ) / ( ; . $ / (          13 ___ Lavender, Private Frank
' / 8 6 ( ' 9 7 3 7 2 1
        
Hitler (4)
/ ( $ 1 % $ : ' < 8 5 9 1 6 4 37 2 20 Motor (6) Pike in Dad’s Army (3)
        
( 5 3
' ( % $
(
5
7
$
8 5
% / (
3 5 2
6 7 8 4 9
1 5
1 7
8
9
WORDWHEEL          21 Four score 14 Sign attached to a car indicating
that the driver is a learner (1-5)
$ ( 5 $ $ /
1 5 4 2 5 8 9 The nine-letter word          and ten (6)
& 5 $ * 1 2 7 , ) <
2 8 6 8 9 1 6          15 Epitomise (6)
+ 8
( % 2 1 <
7 , 2
6 3 $ , 1 9 7 2 4 2 9
was DIAGNOSED          18 Portent (4)
 City Focus
21
THE LAST
AIRBENDER
| Careers REVIEWED IN
TOMORROW’S PAPER

Learning lessons from BP’s mistakes

Whatever your job, it
pays to be prepared
for a crisis, writes
Jeremy Hazlehurst

A
ND relax. At long last the great BP
oil spill disaster of 2010 appears to
be over. Black stuff is no longer
leaking into the Gulf of Mexico,
killing everything in its path. Brown stuff
is no longer being power-hosed at Tony
Hayward, the hapless CEO whose poor
media performances enraged Americans
and helped halve the firm’s share-price. So
what lessons can be learnt from this sorry
tale? And how can you put them to use?
Here are five things you can take from the
BP fiasco.

1. Reputational damage has a clear

financial implication. Just look at BP’s
share price, which is now just half what it
was at before the Deepwater Horizon rig
exploded. So says Gus Sellitto of crisis-
management specialist City PR firm
Byfield, who points out that in this world
of blogs, 24-hour news and a more sophis-
ticated financial press, stories can easily
spiral out of control. This means that
firms must have a joined-up response to
crises. “Lawyers and risk-management
departments and PRs should all work
together,” he says. A company line is vital.
Even if your company isn’t going to cause
an oil-slick, other things can also damage
reputation. For example, false claims of
sexual or race discrimination. These days
people are far more likely to go to the
press. Be prepared. If not, it could cost you
money.
4. Planning for disaster is essential. So
says Gill Ringland of crisis management
consultancy SAMI and the co-author of
Beyond Crisis: Achieving Renewal in a
Turbulent World. As head of corporate
strategy at technology firm ICL, she
worked out a contingency plan for the
eventuality that an earthquake would hit
the factory in Japan that supplied vital
parts. The company worked out a draft
contract with an alternative supplier and
ter was averted. Of course, the worst disas-
ters are black swans – events that nobody
predicted. But you should work out the
Firefighting is part of
corporate life.
chain of command and think about the PIC: REUTERS
best person to deal with different types of
crisis. In the case of BP, it should have been
obvious that the very British Tony
Hayward was not the man to deal with the
US media, says Ringland. Somebody with a
better grasp of the country and its culture
should have been the face of the company.
stand which other parts of the company
you rely on,” Ringland says. Know where
the problems might come from. The best
way to work this out is to have a dry-run.
Ringland talks about a City firm that sim-
ulated a bomb going off in the Square
Mile. All the contingencies went well –
except that the telecoms manager had
been under such cost pressure that he
had cut the capacity of the network so
much that only 30 of the 600 staff could
actually get on-line remotely. “Some

2. Internal communication matters.

Kathryn Adamson of Gardant
checked that their parts were compatible.
And when an earthquake did hit, six
months later, ICL’s revenues were undam-
5. You have to understand your
company to understand your own job.
things only come out when you practise
them,” she says. Disasters will always hap-
pen in business. Whatever you are the
Communications, another City PR firm aged. The whole process “only took two or “Although your job is to keep one part of CEO or the post-boy, minimising their
that specialises in crisis management. three days,” she says, and a potential disas- the company running, you should under- impact is part of your job.
“People generally panic and don’t know
what to say to staff so the default becomes
radio silence. This is always a big mistake.
Whatever level of the company you work
at you should have a message, and you
must communicate it to those who work
for you. Middle management are front
line with staff and they need to know
what they can say and when they need to
refer to the senior management for com-
ment.” She also points out that people
must understand when and if they should
speak to the media. There must be rules of
engagement, or somebody might speak
out of turn and even if they mean well,
that can be disastrous. All this tells us
that… Too busy to find a new role?
3.
Leave it to us.
Employees matter. Directors might get
obsessed with headlines, but far more
damage can be done by those who work
for you. “Employees are potentially your
best ambassadors and they will have
friends and family asking them what is
going on; it is imperative that they know
what to say,” says Adamson. The granny
who decides to sell her shares because her
son who works for the company is bad-
mouthing it might seem like an irrele-
vance, but a thousand of them are not.
Executives often neglect to look inwards.
“Sometimes we go in to companies and
ask what they have said to their employ-
)RU([HFXWLYHV(DUQLQJ…N…P
ees, shareholders and clients and they say 7RDUUDQJHDQH[SORUDWRU\PHHWLQJFDOO
they haven’t thought about it,” says Gus
Sellitto. “You should share as much infor- (ORQGRQ#LQWHUH[HFFRXN:ZZZLQWHUH[HFFRXN
mation with them as you are legally
allowed to.”
 Sport
22 CITYA.M. 12 AUGUST 2010

Results Capello: Beckham’ is

CRICKET
LV COUNTY CHAMPIONSHIP—Division One: Lancashire v
“too old” to continue
Durham (Old Trafford): Lancashire 181 (M J Chilton 69, I D
Blackwell 5-78) and 226 (S Chanderpaul 67, M J Chilton 50,
I D Blackwell 4-102) v Durham 237 (I D Blackwell 65, G FABIO CAPELLO last night
Keedy 7-68) and 58-2 (21.0 overs). Hampshire v Somerset appeared to call time on David
(Taunton): Hampshire 284 (M A Carberry 71, C M Beckham’s international career,
Willoughby 4-80) v Somerset 392-7 (103.0 overs) (Z de admitting the 35-year-old former
Bruyn 95, J A Tomlinson 5-78).
captain is a “little bit old”.
LV COUNTY CHAMPIONSHIP—Division Two:
Northamptonshire v Derbyshire (Chesterfield): Beckham missed the World Cup
Northamptonshire 201 (G M Smith 5-54, J L Clare 4-42) and through injury but joined Capello as
469 (D J G Sales 92, J D Middlebrook 84, R I Newton 82, B part of his back-up team because of
H Howgego 80, P S Jones 4-96) v Derbyshire 319 (C F the influence he has on the squad.
Hughes 156, R J Peterson 58, E Chigumbura 5-92) and 44-0
(16.0 overs). Glamorgan v Worcestershire (Colwyn Bay): But the Italian admitted the LA
Glamorgan 369 (M J Cosgrove 84, B J Wright 72, J W M Galaxy midfielder is unlikely to add
Dalrymple 56) and 355-6 (76.0 overs) (T L Maynard 98, G P to his 115 England caps when he
Rees 65, J Allenby 62). v Worcestershire 350-8 dec. (D K H recovers from his Achilles injury.
Mitchell 165no, A N Kervezee 72). Middlesex v
Leicestershire (Lord’s): Middlesex 219 (G K Berg 53, T J “I say thank you very much for
Murtagh 50no, M J Hoggard 6-63) and 168-4 (62.0 overs) helping me at the World Cup but
(S A Newman 70). v Leicestershire 282 (J W A Taylor probably he is a little bit old,”
106no, G P Smith 65, T S Roland-Jones 4-52, P T Collins 4-
76). Sussex v Surrey (Guildford); Sussex 217 (C T Tremlett 4- Capello said.
32) and 39-2 (12.0 overs) v Surrey 292 (S M Davies 62,
Yasir Arafat 5-81).
FOOTBALL ENGLAND | HOW THEY RATED
INTERNATIONAL MATCHES
England..........................(0) 2 Hungary..............................(0) 1 1 Joe Hart 7
Gerrard 73, 73 Jagielka 63 (og)
Att: 72,024
2 Glen Johnson 7
Montenegro................(1) 2 Northern Ireland .........(0) 0 3 Ashley Cole 7 (Kieran Gibbs 46, 7)
Djalovic 43, 59 Att: 5,000 4 Steven Gerrard 9 (Jack Wilshere 82, 6)
Sweden..........................(2) 3 Scotland .............................(0) 0
Ibrahimovic 4
5 Phil Jagielka 6
Bajrami 39 6 John Terry 6 (Michael Dawson 46, 5)
Toivonen 56 Att: 25,249 7 Theo Walcott 7 (Ashley Young, 46, 7)
Rep of Ireland...........(0) 0 Argentina...........................(1) 1
Att: 49,500 Di Maria 20
8 Frank Lampard 7 (Bobby Zamora 46, 8)
Wales ...............................(1) 5 Luxembourg .....................(1) 1 9 Adam Johnson 8
Cotterill 35 Kitenge 44 10 Wayne Rooney 7 (James Milner 66, 6)
Ledley 48 (pen) 11 Gareth Barry 6
King 55
Williams 78
Bellamy 82 Att: 10,000 Gerrard netted with two superb individual efforts inside four minutes to turn the match. Picture: ACTION IMAGES
Armenia .........................(1) 1 Iran ........................................(0) 3

Hero Gerrard saves England

Austria...........................(0) 0 Switzerland .....................(0) 1
China PR.........................(1) 1 Bahrain.................................(1) 1
Czech Republic.........(0) 4 Latvia....................................(0) 1
Denmark.......................(0) 2 Germany..............................(1) 2
Finland ............................(1) 1 Belgium...............................(0) 0
Lithuania ......................(0) 0 Belarus .................................(1) 2
Malta...............................(0) 1 FYR Macedonia ..............(1) 1
Moldova ........................(0) 0 Georgia................................(0) 0
Norway ..........................(0) 2 France ..................................(0) 1
Poland.............................(0) 0 Cameroon...........................(1) 3
defuse a potential timebomb for Fifa Wilshire in the second half, while fel- support Wayne Rooney in an exciting
Russia ..............................(1) 1 Bulgaria ..............................(0) 0
Serbia .............................(0) 0 Greece...................................(1) 1
Slovakia.........................(0) 1 Croatia.................................(0) 1
ENGLAND 2 president Sepp Blatter as the row over
goal-line technology reared its ugly
low substitute Bobby Zamora twice
came close to scoring on his interna-
attacking trio. And it seemed to work
a treat in the early stages as Rooney
Slovenia.........................(0) 2 Australia ............................(0) 0 head again. tional bow. had the ball into the net on four min-
South Africa ...............(1) 1 Ghana ...................................(0) 0
South Korea ...............(2) 2 Nigeria..................................(1) 1
Turkey.............................(0) 2 Romania..............................(0) 0
HUNGARY 1 Recalled Phil Jagielka’s attempted
near-post clearance was clearly
The boss said afterwards: “I enjoyed
it. I concentrated on the game and
utes, only to be ruled out for offside,
while Johnson blazed a good chance
USA...................................(0) 0 Brazil.....................................(2) 2 hacked off the line by defensive part- wanted to see everything. “I’m happy over ten minutes later.
ner Michael Dawson, only for French for the performance. We played the Capello reverted back to the 4-4-2 at
▲

Ukraine ..........................(0) 1 Holland ................................(0) 1 INTERNATIONAL FOOTBALL

CARLING CUP FIRST ROUND BY JON COUCH referee Stephane Lannoy to give the first 30 minutes well, the last 10 min- half-time, bringing on Zamora for
Cardiff.............................(1) 4 Burton Albion..................(1) 1 goal in scenes contrasting to those in utes of the first half not so well. Lampard, but it was Hungary who
Bothroyd 17 Harrad 19 CAPTAIN marvel Steven Gerrard South Africa when the Uruguayan “The second half we saw more play- took the lead on 63 minutes –
McCormack 107, 110 spared the blushes of both his under- officials failed to notice Frank ers, different players, young players Dawson’s slip letting in Zoltan Gera,
Chopra 118 Att: 6,080 fire coach and Fifa bosses last night as Lampard’s strike cross the line and the performance was really good. who subsequently set up the attack,
AET: Score after 90 mins 1-1.
Hartlepool ....................(1) 2 Sheff Utd............................(0) 0 England came from behind to beat against Germany. “I think we found some new young which led to an unfortunate deflec-
Brown 6 Hungary in their first outing since But amid a largely receptive players for the future. The fans were tion off Jagielka.
Boyd 61 (pen) Att: 2,520 their dismal World Cup showing. Wembley crowd of 72,024, Gerrard really good, thank you. It surprised Gerrard, however, showed his class
Torquay..........................(0) 0 Reading ...............................(0) 1 The stand-in captain scored two took centre stage, rifling home a 25- me. We hope we can win something with the equaliser six minutes later,
Att: 2,832 Rasiak 120 memorable goals in the space of just yard equaliser into the top corner for these fans.” pouncing onto a loose ball and crash-
AET: Score after 90 mins 0-0.
four minutes as the new era under before a sublime individual effort Capello moved away from much- ing the ball home, before then col-
Fabio Capello began with an eye- wrapped up a morale-boosting win maligned 4-4-2 system which failed lecting a pass from Ashley Young and
SPORTS EDITOR JON COUCH catching win. Capello handed debuts to both England in the World Cup, recalling finishing with a deft toe-poke after
email sport@cityam.com But Gerrard’s salvo also helped Arsenal pair Kieran Gibbs and Jack Adam Johnson and Theo Walcott to beating four opposition defenders.

Sir Alex expecting a dogfight –

Lerner: O’Neill quit over dispute just to finish in the top four
[caretaker boss] Kevin MacDonald and And Lerner appears to be close to
▲

FOOTBALL
resolving the situation with appointing O’Neill’s successor after FOOTBALL “Things definitely changed last sea-
▲

BY MARTIN CAPARROTTA
Manchester City and James Milner,” bookies reported a big gamble on for- son – it was a different league alto-
ASTON VILLA chairman Randy Lerner said Lerner, who, like O’Neill, arrived mer England manager Eriksson SIR ALEX Ferguson yesterday warned gether compared to what we’d seen
yesterday claimed Martin O’Neill’s at Villa Park four years ago. becoming the new Villa boss. his Manchester United side to prepare before,” said Ferguson, whose side
departure was down to a difference of “As for explaining why Martin left, In fact, Paddy Power suspended the for a “dogfight” this season – just to were pipped to the title by Chelsea
opinion as bookies slashed the odds I can say only that we no longer betting market yesterday afternoon finish in a Champions League place. last season.
on Sven-Goran Eriksson to take over shared a common view as how to as the Swede’s price plummeted from The wily United boss expects the “The top four found it difficult and
the reigns at Villa Park. move forward. 6/1 to 7/4 in less than an hour. likes of Tottenham, city rivals dropped points in games they would-
The American tycoon revealed a “To deal in greater detail would do Meanwhile, Everton boss David Manchester City, managerless Aston n’t have expected to. That’s an indica-
disagreement over the club’s direc- little but cause additional distraction Moyes has ruled out any link with the Villa, and Everton to contest a scram- tion of the improvement made by
tion caused O’Neill to step down just for the club as it faces imminent vacant job at Villa Park, despite com- ble for European spots this term, other teams, and I think there’ll be a
days before the new season and said games, and the clear priority of hir- ing out second to Martin Jol in a fans’ while he himself plots to land United bit of a dogfight for the top four
he is looking to conclude James ing a permanent manager. poll. a record 19th league title. places this season.”
Milner’s Manchester City switch as He added: “Finally, there have been The Scot said: “I am loyal to And the Scot believes Tottenham’s He added: “We all have to be aware
quickly as possible. no changes in our approach to build- Everton, I’ve always said that. fourth-place finish last season is a of the threats from the likes of Villa,
“Having had some time to reflect ing the club, aiming always to be as “It is a really good club and this sign of things to come as competition Everton, Tottenham and Manchester
on Martin leaving, I can say that our competitive as possible given our size year we have a really good team and for a place in the top four intensifies City – they’ll all be challenging to get
most immediate focus is supporting and resources.” we have a good chance of doing well.” by the year. into that top four.”
CITYA.M. 12 AUGUST 2010
Tiger’s on the rampage! At
17-1, I’ll take a piece of that
ON THE GREENS WITH
SAM TORRANCE
T
AMING a wounded animal is a
dangerous proposition in any
sport – especially if that animal
happens to be a Tiger.
Tiger Woods may have looked out-
of-sorts and going through the
motions during his worst-ever 18-
over-par total in the WGC-
Bridgestone last weekend, but I’d be
very surprised to see a repeat of that
at Whistling Straits, starting today,
when the world No1 goes in search of
a 15th Major title in the US PGA
Championship
Incredibly, Tiger has been pushed
out to 17-1 by the bookies for a fifth
US PGA victory – fantastic odds for a
man who simply thrives on pressure
and proving his critics wrong.
ACCURACY
Tiger will be aware, however, that
Whistling Straits is not the place to
play if you’re not at the peak of your
powers.
With its stunning views providing
the perfect backdrop to Lake
Michigan, this is a breathtaking links
course, crafted by Pete Dye on the site
of a former army base.
On the other hand, however, with
it’s 1,200 bunkers and 7,507 yards of
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Best time: 29min 00secs
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Average pace: 07.25 min/mi
Best pace: 06.95 min/mi
tight fairways and greens – the sec-
ond longest in Major history – it is
also the most unforgiving course in
the world. It’s relentless from the first
drive to the final putt and anyone,
Woods included, will get found out –
and very quickly – if they’re not on
the top of their game.
The Straits course is supposed to
replicate the links courses of Britain
and Ireland, but I don’t necessarily
mean that favours a home player –
it’s so tough, it’s simply about who
can step up to the plate and hold
their nerve on the day.
Vijay Singh was the last Major
champion here, back in 2004, and
that pretty much tells you what you
need to know about how to win here.
Vijay is one of the longest, straight-
est drivers on the circuit and that’s the
dream combination again this week-
end with pin-point accuracy essential.
It’s a pity that Lee Westwood is
missing this weekend as the course
would have suited him down to the
ground, although the likes of Rory
McIlroy, Justin Rose and Ian Poulter
will all be quietly confident that their
game can stand up to the challenges
that await.
US PGA | PAST WINNERS
2009 YE Yang (Hazeltine)
2008 Padraig Harrington (Oakland Hills)
2007 Tiger Woods (4) (Southern Hills)
2006 Tiger Woods (3) (Medinah)
2005 Phil Mickelson (Baltusrol)
2004 Vijay Singh (2) (Whistling Straits)
2003 Shaun Micheel (Oak Hill)
2002 Rich Beem (Hazeltine)
PEDESTRIANS, traffic, cobbled streets –
there could be countless reasons for
being forced change your route in the
Garmin #4miler challenge.
But Investec team champion Robert
Johnson was presented with the most
novel yet as he went through his paces
on the banks of the Thames last week.
“I was about to cross Tower Bridge
one Sunday morning when I realised
the bridge was raised,” Johnson joked.
“As much as it’s a magnificent sight,
I had to turn round and go back.”
Johnson’s eight-man team from
Investec have altered their initial
route in a bid to lower their time after
encountering the usual problems
that go with city runs.
F
O F
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Woods carded a worst-ever 18-over-par at the WGC event last week.
“Lunchtime is the busiest time for
tourists and the hustle and bustle was
making it difficult to get into any
rhythm,” Johnson added. “Now, we’ve
decided to start from St Paul’s, towards
Westminster, over Westminster Bridge
and then back along the river and over
Millennium Bridge. It’s working for us
and we’re all beginning to see a differ-
ence in our times.”
Johnson also believes that running
in a team environment is also helping
to increase his speed. “It’s great meet-
ing new people within the company
that you wouldn’t normally see and it
gives us the motivation to push our-
selves further. We’re really beginning
to reap the benefits.”
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SPORT | IN BRIEF
Door left open for Borthwick
RUGBY UNION: Martin Johnson yester-
day hinted Steve Borthwick could once
again captain England after refusing to
confirm Lewis Moody would be his skip-
per through to next year’s World Cup.
Borthwick, who captained England
for the first 20 Tests of Johnson’s reign,
was replaced by Moody after he was
ruled out of the summer tour of
Australia with a knee problem.
“I will not commit to (Moody being
captain until the World Cup)," said
Johnson. "It is very competitive. Anyone
who thinks they are comfortable in the
England 32 won’t be there for very long.”
Halsall continues gold rush
SWIMMING: Francesca Halsall sealed
Britain’s third gold medal at the
European Championships in Budapest
after leading from the front in the
women’s 100m freestyle final yesterday.
Halsall, 20, held off tough competition
from Belarusian Aliaksandra Herasimenia
to win with a time of 53.58 seconds
before Joe Roebuck secured bronze in
the men’s 200m individual medley.
United net £7m Bebe
FOOTBALL: Manchester United last
night snapped up Portuguese striker
Bebe from Vitoria Guimaraes for a fee of
around £7m. The 20-year-old front man
is expected to undergo a medical at Old
Trafford today.
Elsewhere, Stoke City smashed their
record transfer after completing the
signing of striker Kenwyne Jones from
Sunderland for an £8m fee, while West
Ham have signed Ajax striker Miralem
Sulejmani on a season-long loan.
Murray eases through in Toronto
TENNIS: Britain’s No1 Andy Murray
cruised into the third round of the
Rogers Cup in Toronto last night after a
comfortable 7-5, 6-2 victory over Xavier
Malisse.
The world No4, playing his first tour-
nament since his split from coach Miles
Maclagan, now faces another
Frenchman, Gael Monfils, in the next
Picture: GETTY round.
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