BUSINESS WITH PERSONALITY
OUR INSIDER GUIDE TO
Issue 1,326 Monday 21 February 2011
LIBYA IN TURMOIL
AS HUNDREDS DIE
WORLD
▲
BY STEVE DINNEEN
VIOLENT protests in Libya threatened
to spiral out of control yesterday, with
hundreds reported dead and Colonel
Gaddafi’s 42-year reign under serious
threat.
Gaddafi’s son Saif al-Islam attempt-
ed to calm protesters, promising
“reform and democracy” and blaming
foreign instigators and radicals for the
outbreaks of violence.
He said: “They have started a cam-
paign to bring Libya to a point reached
by Egypt and Tunisia.
“Security forces have pre-empted
this and arrested some of the people
involved. A few people have died and
violence against the police has esca-
lated. We will have a new Libya, one
we have dreamed of. We can have
reforms without destroying our
country.”
He told protesters the country could
descend into civil war if the violence
continues, claiming swathes of the
country remain loyal to his father.
Thousands of protesters clashed
with supporters of Gaddafi in Tripoli’s
Green Square, with helicopter gun-
ships and snipers said to have been
deployed. Protesters have also taken
control of military bases and tanks.
At least 50 people were killed and
100 seriously wounded in the space of
just a few hours last night. A further
84 people were killed on Saturday and
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Protesters gather outside the Libyan embassy in London yesterday to rail against Colonel Gaddafi
20 in overnight clashes, with some
commentators claiming more than
300 people have died since the vio-
lence began. Saif al-Islam claimed for-
eign media organisations have
exaggerated the numbers.
Protesters in the streets of the
Libyan capital were throwing stones at
billboards of Colonel Gaddafi while
NASDAQ ▲2,833.95 +2.37 £/$ 1.62 unc £/¤ 1.19 unc
LAWYERS AT
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police used tear gas to try to disperse
them.
The opposition is demanding a con-
stitutional monarchy that gives citi-
zens a greater role in a directly elected
government. It also wants the release
of political prisoners.
Foreign secretary William Hague
yesterday urged Libya to begin dia-
Picture: REUTERS
logue with anti-government protesters
and implement reforms.
Hague told Saif al-Islam Gaddafi
that the Libyan government’s actions
were unacceptable and would trigger
global condemnation.
Unrest also hit Yemen, Tunisia,
Morocco, Oman, Kuwait, Algeria and
Djibouti over the weekend.
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G20 bows
to Chinese
demands
POLITICS
▲
BY STEVE DINNEEN
CHINA forced a series of tough conces-
sions from the G20 over the weekend
as finance leaders thrashed out which
indicators should be used to measure
risks to the global economy.
The talks were overshadowed by the
feud between China and the US over
the Eastern power’s perceived manipu-
lation of its exchange rate to devalue
the yuan and keep its exports cheap.
Western finance ministers led by
the US had hoped to include exchange
rates and currency reserves among a
list of indicators that would be used to
monitor the economies of member
countries.
But with the talks ready to collapse
and China refusing to countenance
their inclusion, they were forced to
cave to China’s demands. China also
succeeded in removing a reference to
current account imbalances in favour
of the more narrow trade balance, in
which Beijing expects its surplus to
shrink as it boosts domestic demand.
Chancellor George Osborne
attempted to put a positive spin on the
gruelling set of negotiations, saying
the meeting was an important step for-
ward. China had previously hoped to
avoid having to adhere to such a strict-
ly defined list of indicators and the
inclusion of net investment income
flows was also seen as a victory.
The problem now will be in agree-
ing on how to implement the list, with
talks in April expected to be fraught
with difficulties. MORE G20 P2
Certified Distribution
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 2 News
Coalition losing its way on tax wars
EDITOR’S LETTER
ALLISTER HEATH
IT is starting to look as if the British
government has completely lost the
ability to fight back against its critics,
especially when it comes to tax.
Instead, it keeps trying to appease
them, attempting to move to the left
of Labour on the issue and failing to
understand that such a strategy is
doomed to failure.
A heavily spun story on Saturday
about the amount of corporation tax
paid by Barclays triggered off another
bout of banker-bashing. Yet the main
reasons why the firm didn’t pay
much UK corporation tax in the year
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Deputy Editor David Hellier
News Editor David Crow
Night Editor Katie Hope
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Lifestyle Editor Zoe Strimpel
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WHAT THE OTHER PAPERS SAY THIS MORNING
BUSINESS JET TRAVEL REBOUNDS AS
RICH SPLASH OUT FOR PRIVACY
Private jet travel, shunned in the
recession as a sign of ostentation, is
recovering in a further sign that the
world’s richest people are spending
more freely again. The number of
business flights – which includes
celebrity, state and business hire –
grew 5.5 per cent last year, in both
European and US airspace, according
to figures from Eurocontrol, the air
traffic management co-ordinator,
and Argos International, an aviation
market research company.
HEDGE FUND JOINS HIGH-RISK INSUR-
ANCE ARENA
A specialist hedge fun focused on
insurance risks will this week launch
a public fundraising for a closed-end
version of its main fund in an
attempt to bring in up to £200m in
long-term capital and broaden its
in question (though it handed over
£2bn in total to HMRC) included its
use of the long-established rule which
allows all companies to write off past
losses against tax, as well as the fact
that global firms pay taxes in all the
jurisdictions in which they operate,
not just in the UK. All companies in
the UK do this; until now, it hasn’t
been seen as a scandal. The ability to
write off losses prevents firms from
paying more tax than they make in
profits over time or at least to make
sure that they don’t pay an extremely
high rate of tax on their profits.
That said, there is a very strong case
for tearing up the whole tax system to
make it fairer, more efficient, simpler
and to ensure it only taxes income
and profits once. The current tax code
is scandalously flawed and in desper-
ate need of radical reform. Loopholes
should go in return for lower, flat
rates. It is equally the case that the
overall tax burden is already at crip-
plingly high levels in the UK, especial-
ly when compared with more
Tough talks
ahead for G20
G20
▲
BY STEVE DINNEEN
THE hard-fought compromise may
have saved this weekend’s G20 meet-
ing from complete failure by win-
ning Chinese backing for a set of
indicators on economic imbalances,
but the divided group faces a
tougher task ahead in agreeing on
how to use the list.
Members of the G20 will come
together again in Washington in
mid-April, at which time group
leader France has said it hopes that
terms can be set for the indicators.
French economy minister
Christine LaGarde admitted the
negotiations had not been easy, and
that there was a long way to go
before the indicators were finalised.
“Everyone agrees that the interna-
tional monetary system will not be
investor base, according to people
with knowledge of its plans.
ENERGEES INVESTMENTS TAKES CON-
TROL OF REGAL PETROLEUM
Regal Petroleum, the Aim-quoted oil
and gas company, has been taken over
by one of Ukraine's largest business
conglomerates. Energees
Investments, a subsidiary of one of
the biggest diversified holding com-
panies in Ukraine, where Regal’s
operations are focused, said it had
taken control of 51.7 per cent of
Regal’s equity after offering 38p a
share.
GAZ ON THE CUSP OF VOLKSWAGEN
DEAL
Gaz, the Russian carmaker owned by
tycoon Oleg Deripaska, expects to
sign a deal later this week with
Germany’s Volkswagen to build
Skoda and VW cars on contract,
according to a company executive.
The deal would need to be signed this
week to meet a February deadline.
dynamic economies in Asia. This is
the kind of message one might have
expected from a government that
claims that Britain is once again
“open for business.”
Yet in a bid to justify his balance
sheet tax on banks and to tap into
anti-City sentiment, the Chancellor
chose to go along with the myth that
taxes were too low on the City under
Labour (in fact, they were extremely
high in the aggregate at the height of
the boom, far higher than now, giving
Gordon Brown an extra incentive to
keep supporting an unsustainable
and disastrous bubble). His tactics will
backfire. If banks don’t pay enough
tax because they are able to write off
past losses, then this must logically be
equally true of millions of other
firms. The pressure will be for even
more tax hikes – what next, a balance
sheet tax on all large firms to “com-
pensate” for poor profits during the
recession? In the same way that the
Tories helped move the debate to the
left when for years they refused to
reshaped in a day or even in a year.
These are not targets, goals, these
are indicators,” she said.
UK Chancellor George Osborne
spoke of his support for the indica-
tors, emphasising that exchange
rates were clearly included in the
wording of the communique.
“We did take an important step
forward by agreeing these indica-
tors, which was quite a drawn-out
process but we got to the right end-
point.
“Very explicitly, in the commu-
nique it mentions exchange rates as
part of the imbalances, as well as
what we’d supported, which was
public and private debt, and that
gives us the green light to go for-
ward to the April meetings to agree
the guidelines by which we’re going
to assess the indicators,” said
Osborne.
A HELPING HAND FOR FIRST-TIME BUY-
ERS FROM ACROSS THE POND
An American insurance group is to
provide mortgage indemnity insur-
ance against first-time buyer and
high-risk mortgage defaults.
Genworth Financial has been chosen
as the mortgage indemnity insurance
provider for Mutual One, a joint ven-
ture owned by building societies
including the Hanley Economic and
Skipton. The partnership means that
Mutual One can act as a representa-
tive for Genworth and arrange and
administer mortgage indemnity.
ELITE FORCE WON’T HAVE TIME TO
CHASE FRAUDSTERS, LAWYERS FEAR
The fight against financial crime is
being lost in a territorial fight
between government departments,
and breaking up the Serious Fraud
Office could make the situation
worse, lawyers fear.
criticise Gordon Brown’s irresponsi-
bly profligate spending plans, they
are doing it again on tax. And given
that they will never be able to-outbid
Labour on that front, they will even-
tually lose the battle of ideas – and
Britain will end up an even higher tax
economy.
The latest incarnation of the peren-
nial middle class anti-capitalist move-
ment appears to have convinced itself
that higher taxes on companies and
“the City” could easily plug the budg-
et deficit and eliminate the need for
spending cuts. Given that the deficit
is around £150bn, this is complete
nonsense: at best, a few billion more
could be raised but with disastrous
consequences to competitiveness and
jobs. If the government doesn’t want
to see its popularity fall even further
in the polls, it needs to tackle its crit-
ics head-on and explain why they are
wrong-headed. The current short-ter-
mist tactics will end in tears.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
Popular Chinese social networking site Renren has 40m registered users
Renren owner plans IPO
MEDIA
▲
BY ELIZABETH FOURNIER
ONE of China’s largest social network-
ing companies, Oak Pacific
Interactive, is planning to raise
around $500m (£308m) this year in a
initial public offering (IPO) in the US.
Oak Pacific, the owner of Chinese
social networking site Renren, hired
Credit Suisse Group and Deutsche
Bank in December to underwrite an
IPO, planned for the first half of this
year. At that time, the amount to be
JAMES CAAN: CAAN-DO ATTITUDE
LAUNCHES FORMER TV DRAGON INTO
SUPER-PRIMEPROPERTY
James Caan, the entrepreneur who
quit BBC2’s Dragons’ Den last month,
has pitched his own idea for a £100m
money-spinner to some of the biggest
property developers in central
London. Caan is looking to invest
£100m in super-prime London proper
The former Dragon is teaming up
with developers including Candy &
Candy to launch a property scheme
that will buy, develop and re-sell luxu-
ry houses in Mayfair and the West
End.
FOX TO CRACK DOWN ON MILITARY
OVERSPENDS
Liam Fox will launch a fierce attack
on “ballooning” spending in his own
department as figures show projects
are running at least £8.8bn over budg-
et.
CITYA.M. 21 FEBRUARY 2011
NEWS | IN BRIEF
RBS in £1.6bn legacy loans sale
Royal Bank of Scotland is set to sell
£1.6bn of unwanted legacy loans as the
bank focuses on making disposals from
its remaining £150bn of non-core bank-
ing business. The bank, which is set to
report its full-year results on Thursday,
is expected to report a pre-tax loss of
around £600m for 2010. According to a
Financial Times report, RBS has asked a
small number of private equity groups to
sign a non-disclosure agreement to open
the process to firm bids for the loans.
The sale of the commercial property
loans is smaller than expected as the
bank had talked of a sale of up to £3bn,
but it would still be the largest property
loan sale of its kind attempted in the UK.
Daewoo wins shipbuilding order
Daewoo Shipbuilding & Marine
Engineering has said this morning it
expects to win a 2 trillion won (£1.1bn)
order from AP Moeller-Maersk to build
10 of the world’s biggest type of con-
tainer ships. The deal for the container
ships, which will also include options for
further vessels, will be signed later
today in London, Seoul-based Daewoo
said in a regulatory filing.
raised had not been finalised.
According to people with knowl-
edge of the plan, the company is
preparing an IPO of about $500m,
and has hired Morgan Stanley.
Neither Morgan Stanley nor Oak
Pacific could be reached for com-
ment.
As of July 2008, the Renren social
networking site had 40m registered
users. Similar to Facebook in func-
tion, Renren was also started by a
group of students, and gained popu-
larity in China’s universities.
GROUPON GEARS UP TO EXPAND INTO
CHINA
Deals website Groupon appears to be
making preparations to start opera-
tions in China, a move that could
shake up the market for group buy-
ing, even though challenges lie ahead
for the young US company. Chicago-
based Groupon, which opened in
2008 selling discounted products and
services from local merchants such as
restaurants and nail salons, faces a
huge internet market that has con-
founded some of the world’s biggest
players.
CANADA IS KEY FOR SAPPORO
Sapporo Holdings is mapping out
strategies that could involve acquisi-
tions or creating a new plant to meet
rising demand for premium beer in
North America. In Asia, meanwhile,
the Japanese company is expanding
its beer and soft-drink business.
CITYA.M. 21 FEBRUARY 2011 News 3

Diageo eyes $2.5bn

German Chancellor
Angela Merkel has
been leading calls
for subordinated
bondholders to face

bid for Turkish Mey

haircuts on their
bank debt
Picture: REUTERS

in Turkey and controls 80 per cent of

▲
M&A
BY STEVE DINNEEN
DIAGEO is set to announce the acqui-
sition of Turkish spirits firm Mey Içki
Sanayi ve Ticaret for a staggering
$2.5bn (£1.54bn).
Diageo could finalise the deal as
soon as this morning, according to
the Wall Street Journal.
Mey, owned by US firm TPG, is
among the largest alcohol producers
the market for Turkish national drink
raki. Diageo is being advised by UBS.
TPG is being advised by JP Morgan
and Goldman Sachs.
TPG had previously considered an
initial public offering for the firm.
Diageo last month admitted
European sales are weakening and
that it is pinning its growth hopes on
drinkers in emerging markets such as
Turkey.

Moody’s plans
downgrades “BE SIMPLER THAN
WHAT COULD

for big banks

”
ing banks and impose losses on cred-
▲

BANKING
BY JULIET SAMUEL
REGULATION aimed at removing
taxpayer support for banks that are
“too big to fail” could lead to ratings
downgrades for 177 major global
banks this year, ratings agency
Moody’s has warned. The reforms
will allow even big firms to fail and
impose costs on bondholders.
Regulators’ determination to tack-
le the problem of taxpayer bail-outs
with special new resolution and
bankruptcy procedures will raise
borrowing costs for dozens of banks
as implicit guarantees are axed, the
agency said as it began a review into
banks’ subordinated debt ratings.
The review excludes UK banks
because the UK government has
already “demonstrated both its abili-
ty and willingness to impose losses”
on junior bondholders, says
Moody’s, and “our ratings already
reflect these actions”.
The agency’s position on the UK
contradicts claims that British banks
still benefit from a £100bn “implicit
subsidy” from government.
The review comes as regulators
around the world attempt to craft
rules that enable failing banks to be
wound up rather than bailed out,
most through the use of a “resolu-
tion authority” to take over collaps-
itors, not just equity holders.
But despite tough rhetoric, partic-
ularly from German Chancellor
SPREADS?
Angela Merkel, Moody’s says that
most jurisdictions have yet to make
any progress in eroding the state
guarantee even for junior debt.
In the US, this guarantee affects
ratings for all major banks. Bank of
NOTHING.
America’s subordinated debt rating
would be five notches lower without
the guarantee and Citigroup’s would
be three notches lower (see graphic,
below).
Spain, Japan and Italy are some of
the other worst-affected jurisdic-
tions: Mizuho Bank would see its
junior debt rating fall six notches,
for example.
As regulations change, however,
Moody’s plans to adjust banks’ rat-
ings in line with governments’ will-
ingness to impose losses and the
workability of their plans.
The agency’s analysis also esti-
mates the average ratings “uplift” on
senior debt from government sup-
port.
The UK ranks in the middle of the
pack, with 2.6 notches worth of ben-
efit for banks’ senior debt.
The US’s “implicit guarantee” for
senior debt is worth 2.2 notches,
while Spain’s is worth 2.7 notches
and Japan’s is worth 4.1 notches.

ANALYSIS: MOODY’S SUBORDINATED DEBT RATINGS

Country Bank Subordinated Notches of uplift due
debt rating to govt support
Belgium Dexia Bank Belgium A2 4
Italy UniCredit SpA A1 3
Netherlands ABN AMRO A1 4
Spain Banco Santander Aa3 2
Switzerland Credit Suisse Group Aa3 2
UBS A1 3
US Bank of America Corporation A3 4
Citigroup Baa1 3
Goldman Sachs Group A2 1
JPMorgan Chase & Co A1 1
Morgan Stanley A3 2
Wells Fargo & Company A2 2
 4 News
Obama’s lost
fiscal control,
regrets Soros
▲
US ECONOMY
BY JULIAN HARRIS
PRESIDENT Obama has “lost control
of the agenda” to determine
America’s fiscal future, hedge fund
billionaire George Soros said yester-
day.
Obama faces an uphill struggle to
implement his spending plans,
released last week.
“The agenda is now in the hands of
the Republican Party,” Soros said.
Republicans, who control the
House of Representatives, will “pur-
sue a very strong effort to cut services
by refusing to have any tax increases,”
said Soros, who opposes Republican
efforts to dent government spending.
Obama’s plans have been criticised
for failing to address America’s spi-
ralling spending on welfare pro-
grammes and debt servicing
payments, with Republicans seeking
to force through stronger cuts.
“Many of the supposed budget sav-
ings, such as nearly $40bn (£24.6bn)
of lower unemployment benefits, are
dependent on better economic per-
formance,” said Dan Mitchell of the
Cato Institute think tank in
Washington DC.
“I certainly hope the White House
is correct about faster growth and
more job creation, but they’ve been
radically wrong for the past two
years.”
Under Obama’s plan, the deficit
will fall to $1.1 trillion in the next fis-
cal year – around seven per cent of
GDP, down from its current level of 11
per cent of GDP.
Yet the federal government will
continue adding to America’s $14 tril-
lion debt – almost 100 per cent of
GDP -- for the foreseeable future, even
if the plan succeeds.
“And government spending will
dramatically increase in coming
decades, thanks largely to an aging
population and poorly designed enti-
tlement programs,” Mitchell added.
America’s government spending
has reached 25.1 per cent of GDP,
compared to 18.2 per cent when
George Bush came to office in 2001.
CITYA.M. 21 FEBRUARY 2011
AMERICA’S
BIG DEFICIT
Q. DEFICIT?
HOW BIG IS THE US
Q&A
A.
GOVERNMENT’S ANNUAL
Around $1.6 trillion (£984bn), for
the current fiscal year – roughly
11 per cent of America’s GDP.
Q. WILL IT BE CUT?
A. For fiscal year 2011, government
spending is expected to edge
down on slightly, from $3.8 trillion
to $3.7 trillion. Government receipts
of $2.6 trillion are expected – leaving
an annual deficit of $1.1 trillion.
Q. WHAT IS THE US GOVERNMENT
SPENDING THE CASH ON??
A. In short -- welfare programmes
(over $2 trillion in the next fiscal
year), the wars (a Defence budget of
more than $0.75 trillion), and inter-
est payments on government debt
which could hit $250bn.
Q. WILL US FEDERAL SPENDING
COME UNDER CONTROL??
A. President Obama’s plan aims for
the annual deficit to be reduced
to three per cent of GDP by 2014. In
the UK, Chancellor Osborne aims to
eradicate the annual deficit entirely
by the end of the parliamentary
term.
Q. WILL THE DEFICIT REDUCTION
PLAN WORK?
A. Some commentators say the
plan relies optimistically on eco-
nomic growth, while long term costs
remain a problem. Medicare spend-
President Obama faces a battle see through his US budget plans Picture: REUTERS ing will surpass $600bn by 2015.
 Cell,
cell,
cell.

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 6 News
Irish Nationwide and Anglo
Irish behind borrowing spike
▲
BANKING
BY HARRY BANKS
ANGLO Irish Bank and Irish
Nationwide Building Society were
behind the spike in emergency bor-
rowing from the European Central
Bank, as they seek a speedy sale of
their deposit books.
The two troubled lenders, at the
heart of Ireland’s financial crisis, are
selling deposits and corresponding
assets as part of a wind-down of their
operations under an EU/IMF bailout
deal.
To ensure a sale within the next
week, they have had to withdraw the
underlying assets, around €15bn
(£12.7bn) in state-backed IOUs, as col-
lateral from the normal week-long
ECB borrowing facility and swap
them instead for emergency
overnight loans, a source said.
The source said the spike in ECB
overnight funding, which caused a
stir across European markets last
week, could continue even after a sale
because the buyer of the deposits,
expected to be a bank in Ireland,
would have to wait until the next ECB
weekly refinancing operation to
switch out of the more expensive
overnight facility.
“It’s possible this spike in overnight
borrowings could last for a couple of
weeks,” said the source.
ECB overnight borrowings hit more
than €16bn on Friday, the highest
amount since June 2009.
ANALYSIS l Ocado Group
300
p
250
200
150
100
Sep
Hedgie makes
big Ocado loss
▲
RETAIL
BY MARION DAKERS
ONLINE grocer Ocado’s recent growth
has stung a US hedge fund, which has
reportedly lost up to £40m by shorting
Ocado stock after the firm’s rocky
flotation in July.
Elinor Carter Brooks from New York-
based Blue Ridge Capital is thought to
have bet against the shares when they
had already dropped to near all-time
lows of 130p in October.
Its shares closed at 259.3p on Friday,
valuing the firm at £1.4bn.
Ocado shares were shorted aggres-
sively following its lower-than expect-
ed float last July, with around 4.5 per
cent of the shares at one point avail-
able for borrowing.
Ocado declined to comment, while
Blue Ridge could not be reached yester-
day.
It was not all good news for Ocado
yesterday, as partner Waitrose
announced a £10m website revamp for
IT bull that shorts Ocado
▲
PROFILE
BY MARION DAKERS
BLUE Ridge Capital, the hedge fund
thought to have lost £40m after bet-
ting against Ocado, is no stranger to
internet-based businesses: its two
biggest long positions in the US are
online giants Amazon and Apple,
according to an SEC filing last week.
The fund was set up by former
Tiger Management president John
Griffin in 1996, and has gone on to
make a fortune shorting everything
from Legal & General to Anglo-Irish
Bank.
Griffin, one of the more successful
“Tiger Cubs” to strike out on his own
after working for Julian Robertson’s
Tiger hedge fund, made a reported
$625m in 2007 to make him the
ninth best-paid hedge fund manager
in Alpha magazine’s rich list.
While the fund’s positions are gen-
erally closely guarded, occasional
regulatory filings have revealed
shorts against property firms Liberty,
Hammerson and Land Securities in
2009, as well as a bet against Anglo-
Irish that was revealed in October
CITYA.M. 21 FEBRUARY 2011
259.30
18 Feb
Nov Jan 2011
its home delivery service.
Waitrose, which supplies most of
Ocado’s products, said it hopes to
launch its own web store in the second
week of March.
Waitrose said its service will focus
on “personal touches” such as letting
customers select the ripeness of fruit.
The employee-owned supermarket
plans to expand inside the M25 for the
first time since signing a supply agree-
ment with Ocado that barred such a
move until last year.
Ocado insiders yesterday played
down any rivalry between the online
services. “Ocado couldn’t be growing
much faster right now, and there is
room in this market for everybody,”
said one source.
Waitrose is also said to be in talks
with potential partners about opening
new franchised stores in South Africa,
Australia and the Far East. It declined
to comment on the potential clash
with Ocado’s business.
2008 – just three months before the
bank was nationalised.
Griffin is adjunct professor of
finance at Columbia Business School
and a visiting professor at the
University of Virginia, as well as the
founder of Blue Ridge Foundation
New York, which supports charitable
start-ups.
Elinor Carter Brooks is the New
York-based Blue Ridge fund manager
thought to have made the ill-fated
b e t
against
Ocado.
JOHN GRIFFIN
 8 News
BARCLAYS TAX ROW
Q. DID BARCLAYS REALLY PAY ONLY
ONE PER CENT TAX IN 2009?
A. Q.
No. The bank’s annual report SO WHY IS THE BANK’S HEADLINE
CORPORATION TAX FIGURE ONLY
shows that it in fact paid £1.05bn
£113M FOR 2009?
globally in corporation tax in 2009,
A.
an effective tax rate of 23 per cent on
pre-tax profit from continuing opera-
tions, or nine per cent if you count
the bank’s one-off £7bn gain from
the disposal of Barclays Global
Investors, which is not subject to cor-
poration tax. In total, including
national insurance, VAT and payroll
tax, the bank and its employees paid
FSA reforms
will raise
costs – IMA
▲
INVESTMENT MANAGEMENT
BY JULIET SAMUEL
ASSET managers have raised fears that
the Financial Services Authority’s
reforms to the Retail Distribution
Review (RDR), an overhaul of rules gov-
erning retail investment advisers,
could create a “distortion of the mar-
ket” and might be based on an unreli-
able assessment of its impacts.
The Investment Management
Association (IMA), an industry body,
has said that the FSA’s latest proposed
changes to the RDR “do not provide a
level playing field between different
types of product and distributor”.
Specifically, the IMA is concerned
about a plan to ban rebates of asset
management commissions. The RDR
includes a broader ban on investment
advisers taking commissions from
providers whose products they recom-
mend, but the FSA’s most recent ver-
sion would also ban the practice of
repaying the commission to investors
in cash.
Many firms take a commission from
providers for selling their product, but
then give retail investors a cash rebate
on the commission to avoid a conflict
of interest, a system that the FSA says
is “confusing” and fails to do away
with adviser bias in product selection.
But the IMA’s Julie Patterson says a
ban on this practice “will not benefit
consumers”, adding: “The FSA’s pro-
posals will have the perverse effect of
leading to increased costs and less
transparency for consumers.”
A spokesman for Killik & Co also
called into question the impact assess-
ment of the proposals, saying: “Given
the government has no faith in the
FSA... and is breaking it up, why is it
relying solely on the FSA’s assessment
on the impact of the RDR?”
The FSA has estimated that the RDR
will cost the industry £127m in one-off
compliance costs and £47.6m in ongo-
ing annual costs.
Iceland calls a referendum over UK debts BC eyes Phones 4U deal
▲
BANKING
BY STEVE DINNEEN
ICELAND yesterday threw into doubt
the repayment of billions of pounds to
the UK and the Netherlands after its
President called a referendum on the
issue.
It is the second time President
Olafur Grimsson has vetoed a repay-
ment bill proposed by the country’s
parliament. In the last referendum, a
over £2bn in UK taxes alone in 2009.
The rest of the bank’s corporation
tax bill was paid in jurisdictions
other than the UK. The bank was also
able to offset drastic losses suffered
during the previous year against its
UK corporation tax, under rules intro-
duced in 2002. It also routed some
transactions through offshore cen-
tres.
large majority of the country’s 200,000
voters threw out an earlier payment
plan, sending negotiations between
the three countries back to square one.
Iceland’s Parliament proposed a
deal to return about $5bn (£3bn) of
bailout money for failed bank Icesave,
which represents about 86 per cent of
the amount the government had to
pay depositors.
Grimsson said that the current par-
liament was the same as that which
Osborne: banks had to pay
▲
BANKING
BY JULIET SAMUEL
GEORGE Osborne has given up moot-
ed plans to ban banks from offsetting
their tax liabilities against past losses,
saying that his £2.5bn bank levy has
rectified the problem of banks “not
paying enough tax” under Labour.
The chancellor was responding to
the row over Barclay’s 2009 UK corpo-
had approved the original Icesave deal
and that, since then, it had not
received a new mandate from the peo-
ple to decide the issue alone.
He acknowledged that the new
repayment terms thrashed out
between Iceland, the UK and the
Netherlands over months of negotia-
tion were better than the first deal.
However, he said it was fundamen-
tal that “the people exercised legisla-
tive power in the Icesave dispute.”
ration tax bill of £113m.
But despite Osborne having once
raised the possibility of doing away
with the widely accepted, long-stand-
ing regime whereby all firms – not just
banks – can reduce corporation tax
bills on the back of past losses, the
Treasury said yesterday that it had no
plans to change policy.
The coalition last year announced
plans to shave one per cent off corpora-
TELECOMS
PHONES 4U could soon be snapped
up by BC Partners after talks were
resumed despite an earlier stalemate.
It is thought BC could offer in the
region of £700m to take control of the
firm from Providence Equity
Partners.
Providence has been mulling a sale
since September after a number of
firms signalled their interest in the
CITYA.M. 21 FEBRUARY 2011
tion tax each year until it reaches 24
per cent (versus 28 per cent now), in
order to stimulate business growth.
But Osborne said his levy was meant to
counteract that effect with regard to
banks.
Barclays paid over £1bn in global
corporation tax in 2009, versus pre-tax
profits of £4.5bn and a £7bn gain from
selling Barclays Global Investors, a
transaction taxed separately.
Seymour
Pierce deal
is in doubt
▲
M&A
BY JULIET SAMUEL
SEYMOUR Pierce’s transatlantic merg-
er with Gerova Financial Group could
fall through this week as Seymour
Pierce’s outspoken chairman Keith
Harris demands clarification on issues
plaguing the New York-listed reinsurer.
The failure of the planned three-way
merger would be an embarrassment
for investment bank Seymour Pierce,
which is handling its own £60m
takeover by Gerova.
It is understood that Harris was
blind-sided by personnel changes at
Gerova last week, when its incoming
chairman Dennis Pelino quit in a
shock move that has contributed to a
plunge in the firm’s share price.
The firm cited an inability “to reach
agreement on the terms of his
appointment” as the reason for Pelino
walking out on the role: its stock has
since dropped 51.6 per cent, or $6.05.
Harris also wants clarification on
issues relating to Gerova’s asset base
and the overhaul of its board, several
of whom quit when Pelino’s appoint-
ment was announced.
Gerova, which was turned from a
special investment vehicle into a finan-
cial services firm just over a year ago,
has in the past been queried by the US
Securities and Exchange Commission
over its disclosure of asset values,
though no action was taken.
Even if the deal with Gerova falls
through, however, Harris is likely to
press ahead with plans to merge with
US firm Ticonderoga Securities, head-
ed by Joel Plasco, former chief execu-
tive of Collins Stewart.
The Gerova deal was to form part of
a three-way merger with Plasco’s firm,
with the resulting entity to be branded
Seymour Pierce and to take up
Gerova’s listing on the New York Stock
Exchange.
Seymour Pierce declined to com-
ment.
company. Talks with BC are under-
stood to have dragged on for several
months before being put on ice.
BC Partners and Phones 4U were
unavailable for comment last night.
Providence bought Phones 4U from
founder John Caudwell in 2006.
A sale would result in a second
windfall for Caudwell. He kept a
small stake in the business after rak-
ing in £1.5bn from selling his empire
four years ago.
CITYA.M. 21 FEBRUARY 2011
ANALYSIS l Planning applications for a change of use
7,000
6,500
6,000
5,700
5,500
5,000
Q1 2010
London set
to defy UK
house slump
▲
HOUSING
BY JULIAN HARRIS
LONDON’S housing market is set to
buck the national trend with the
number of new sellers up by more
than a fifth, the Rightmove house
price index reveals today.
Across the UK, annualised new
seller numbers have remained “prac-
tically unchanged” so that sluggish
transaction levels are “set to be the
norm,” the survey said.
“But home-owners in the capital
are on the move,” commented
Rightmove director Miles Shipside.
“The more elite markets in the UK
have some immunity to the effects of
stunted equity growth and the prob-
lem of accessing mortgage finance,
and Londoners seem both ready and
able to move up the housing ladder,”
Shipside said.
Demand for housing in the capital
has been strong enough to drive up
asking prices by 4.2 per cent this
month, Rightmove said.
Compared to the same time last
year, asking prices in London are up
one per cent, while nationwide the
annual rise has been just 0.3 per
cent.
The average asking price in
London is now £430,680, compared
to £223,121 across the whole of the
UK, its survey found.
Risk averse lenders are looking
toward low loan-to-value deals, more
often available in affluent areas.
Yet nationally “Mr Average” is still
being squeezed out of the mortgage
market, Rightmove said. Lower
deposit mortgages for middle tier
earners will remain at a premium
with the market remaining sub-
dued, it forecast.
While more than half a million
(530,000) mortgages were taken out
in 2010, Rightmove recorded around
1.3m properties coming to market.
Investors slam Rio Tinto buyback plan
▲
MINING
BY MARION DAKERS
MINING titan Rio Tinto came in for
harsh criticism for its proposed $5bn
(£3.1bn) share buyback yesterday, with
leading investors reportedly labelling
the plan “a pathetic gesture”.
Rio Tinto, which said it would speed
up its $5bn buyback to complete it by
the end of next year, reported record
6,800
6,200
Q2 2010 Q3 2010
profits of $20.6bn and a higher-than-
expected dividend payment last week
on the back of surging commodities
prices.
But investors, who shelled out
£9.5bn for a rights issue in 2009, told
the press that they were not being
rewarded for their support and would
consider blocking Rio’s future expan-
sion plans.
The Anglo-Australian miner said
UK stifling property use
▲
PROPERTY
BY JULIAN HARRIS
DEVELOPERS and landlords are try-
ing to escape the economic slump
through changes in the use of their
properties, commercial law firm
EMW has told City A.M.
“Change of use” applications shot
up by 10 per cent in the third quarter
of last year, and by nine per cent the
last week it plans to focus on the
growth of its existing assets, includ-
ing its massive Pilbara iron ore mine.
But shareholders have voiced con-
cerns that Rio is hoarding its cash in
order to fund another large-scale
acquisition, to follow on from its
£2.4bn bid for Riversdale Mining in
December.
Rio’s shares closed at £43.97 on
Friday, valuing the firm at £67.2bn.
previous quarter, its research shows.
Yet a complex and inflexible plan-
ning permission system is stunting
their ability to react to changes in
demand, an EMW spokesperson said.
Planning applications can be
“lengthy and costly”, with red tape
thwarting recovery in the UK’s prop-
erty market, EMW planning specialist
Giles Ferin explained.
“Unfortunately, the current plan-
Albanese between rock and hard place
It seems Rio Tinto chief executive
Tom Albanese can’t win.
After navigating the mining group
through choppy financial waters to
report record profit, lower debt and a
$5bn buyback last week, Albanese’s
firm was derided as “pathetic” and
“boring” by the market.
While a share buyback is generally
the last refuge of a board that’s run
out of ideas, investors are looking to
the bellwether firm to share the
News 9
ning system is overly complex,” he
said. “Properties can lie vacant
because their use is restricted to a cer-
tain type of activity.”
The measures stunt economic
growth and can be a blight on local
communities, the report said.
High restrictions on the use of
property have led to shortages of
space to let in central London, Ferin
added.
Soaring cost
of living hits
households
▲
UK ECONOMY
BY JULIAN HARRIS
HOUSEHOLD finances have taken a
massive hit this month, according to
a Markit index which saw inflation
surge to an all time survey high.
The cost of living measure showed
85 per cent of households reporting a
rise in prices, Markit revealed today.
Mortgage holders were particularly
downbeat, as price pressures increase
the chance of a hike in interest rates.
Overall, 34 per cent of surveyed
households noted a worsening of
their finances in February, with only
five per cent reporting an improve-
ment.
“An unhealthy combination of
high inflation and job worries has
caused households to report that
their financial outlook has slumped
back to the levels seen during the
worst part of the recession in early
2009,” said Tim Moore, senior econo-
mist at Markit.
Rising prices have largely hit those
on low incomes, he said.
The household finance index
slipped to 35.6, down half a per cent
from January’s rate, and well below
its long term average of 38.5.
However, the score was largely driv-
en down by government sector
employees. Respondents in the pri-
vate sector actually recorded an
improvement in their finances, with
an index score of 37.8, slightly up
from January’s 37.6.
And public sector workers
remained especially pessimistic, with
over half (58 per cent) reporting a neg-
ative 12-month outlook for their
finances and only 13 per cent expect-
ing an improvement.
Meanwhile, young people (aged 18
to 24) reported a record fall in their
job security. Overall, around a quarter
of respondents signalled a decline in
their job security, with only seven per
cent reporting an improvement.
spoils of the commodities boom as
quickly as possible without the
drama of another blockbuster acqui-
sition attempt.
Perhaps management should
plump for the safe, albeit dull, option
and return the cash while they still
can.
BOTTOMLINE
Analysis by Marion Dakers
 The Capitalist
10 CITYA.M. 21 FEBRUARY 2011
EDITED BY
ELIZABETH FOURNIER
GOT A STORY? EMAIL
thecapitalist@cityam.com

THE SOUND BILL OF THE WEEK

OF MUSIC
COMES TO
THE WHARF
THE success of hit US TV show Glee has
inspired many high schools and universi-
ties to launch show choirs – and now it
seems not even London’s financial sector is
immune to the lure of a good sing-along.
Hence the launch of the Canary Wharf
Choir, an open singing group for those that
live and work in the shadows of the
Docklands’ skyscrapers.
Following on the success of the area’s
annual Candles and Carols Service, the
choir will bring together keen performers
for more regular shows, including a series
of open-air concerts over the summer.
Battling for his place among the male
leads will no doubt be John Tripp, an exec-
utive director at Morgan Stanley and one of
the driving forces behind the choir. As
Tripp says: “Over the past few years there
has been a burgeoning interest in singing
and we’ve seen choirs developing in new
and unexpected places, including the
workplace.”
With no auditions required to join the
group, the resulting melodies could prove
interesting, but with the inaugural ‘fun-
sing’ event on 14 March, budding sopranos
should at least have plenty of time to prac-
tice.
A Daimler Brand
GOING UNDERGROUND
The Old London Underground Company
has already got Boris Johnson on its side
– a “rash promise” from the Mayor
means that entrepreneur Ajit Chambers
has scored a meeting with Tfl reps to dis-
cuss converting 26 disused tube stations
into “tourist attractions and business
venues”. Now Chambers is on the hunt
for investors, and he’s aiming high.
A marketing email from Chambers
calls for help establishing “a hedge fund
that can be floated worldwide to bring in
investment”. With promises that the
scheme will make £40m for Londoners, it
looks like he’s after a pretty impressive
set of figures to take before the transport
officials next week.
FOUR bankers celebrating a promotion in
the group managed to celebrate in style
with a school night blow-out a couple of
weeks ago – dropping over £1,000 on a
The teenage choir Wednesday night at Kingly Court mem-
singers of hit US show bers’ hotspot The Bureau Club.
Between them, the high-spirited quartet
Glee seem to have
inspired even Canary sank two bottles of vintage Dom Pérignon
Wharf workers to over the evening, at £370 a pop, alongside
tune up their vocal a selection of exotic cocktails, including
chords the intriguingly named Red Amex – a
two-person sharer spiked with Cointreau,
Courvoisier XO and Laurent Perrier Rosé.
Chased down with lavender mojitos, the
party kept its energy levels up with a
couple of food platters to offset the
effects of the colourful drinks. Stomachs
were lined by a selection of cheeses plus
mini British classics – pies, hamburgers
and fish and chips.
We’d imagine there were a few sore
heads, not to mention abused-feeling
credit cards, come Thursday morning.

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CITYA.M. 21 FEBRUARY 2011
Andrew Sentance leads the call for higher rates
Move toward
interest rate
rise expected
▲
UK ECONOMY
BY JULIAN HARRIS
THE Bank of England is moving closer
to a hike in interest rates, it is expect-
ed to reveal this week.
The latest voting record of the
Bank’s monetary policy committee
(MPC) could expose more members
voting for the 0.25 per cent rise when
it is revealed on Wednesday, accord-
ing to some analysts.
Two MPC members voted for a rise
last month, with Martin Weale join-
ing Andrew Sentance’s ongoing call
for a modest step towards bank rate
normalisation.
“We are suggesting that the vote
was 6-3 this time, perhaps with David
Miles also favouring an increase,” said
Investec’s Philip Shaw.
“And it is not impossible that the
outcome was 5-4,” he added.
David Miles is the most likely mem-
ber of the MPC to join the side sup-
porting a tightening of policy, agreed
Alan Clarke of BNP Paribas, while
many observers are pointing to the
increasingly hawkish comments of
the Bank’s deputy governor Charles
Bean.
A rate rise could also be sharper
Steel starts the Firms to grow
year on the up yet taxes bite
▲
UK ECONOMY
BRITISH steel production rebounded
in January, manufacturers’ group EEF
revealed today.
Production was 35.4 per cent high-
er last month than in December,
reaching 201,152 tonnes.
“The uplift in January output was
heartening and is a reflection of the
continuing improvement in UK man-
ufacturing output generally, said UK
steel director Ian Rodgers.
“Nevertheless, we still have a long
way to go to achieve pre-recession lev-
els of steel output, with demand from
the construction sector in particular
remaining very weak,” he added,
News 11
ECONOMISTS’ VIEWS: IS AN INTEREST RATES RISE IMMINENT? By Julian Harris
VICKY PRYCE | FTI CONSULTING ALAN CLARKE | BNP PARIBAS
“ The MPC is getting nearer a rise in
interest rates. This is inevitable eventually. But it
is not clear that recent economics news has made
a rate rise more imminent. The data on input
prices will have encouraged the hawks. But the
“ The Bank’s new forecasts took us a step
closer to the first interest rate hike. But we will
need to see surprisingly strong growth or higher
inflation for a rate hike in the next few months.
Although the inflation report didn't rule out a hike
” ”
Q4 GDP and labour market figures will as soon as May, I suspect it is more likely
have emboldened the doves. that the first hike comes in August.
PHILIP BOOTH | INSTITUTE OF ECONOMIC AFFAIRS
Picture: Micha Theiner/City A.M. “ It is likely that the Bank of England will edge towards a rate rise within the next three months. The hawks will
become more hawkish and those who are in two minds will become concerned by the dogged persistence of inflation.
Interest rates are now 3.5 per cent below the rate of inflation and this is not sustainable.
”
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than expected, according to Douglas
McWilliams of the Centre for
Economic and Business Research.
“I think there will be a temptation
for the MPC to show it’s serious, by
moving 0.5 per cent upwards rather
than 0.25 per cent,” McWilliams said.
With sluggish growth and spi-
ralling prices, the UK is at risk of
“stagflation,” McWilliams added.
Instead of being driven by domestic
labour costs, Britain now faces infla- om
vies.c
ngmo
tion from primary product prices,
w from
samsu
“which are immensely volatile and ble no
availa
tion
driven by international conditions,” Incep
McWilliams said.
In a hard hitting speech last week,
the MPC’s chief hawk Andrew
Sentance warned: “The UK is a very T
sa he T
international economy and global m ow
su n
influences are a major issue for the ng av
m aila
course of demand and inflation in ov ble
ies now
the British economy.” .c from
om
“The value of the pound on the for-
eign exchanges therefore needs to be
one of the key areas of focus for the
MPC,” Sentance said.
Nudging up rates might bring
about a “modest appreciation of ster-
ling,” he said, protecting Britain from
price pressures from abroad.
CNBC’S ROSS WESTGATE:P12
UK ECONOMY
BUSINESSES will strengthen and the
economy grow in 2011, according to a
confidence index released today.
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burden than a year ago.
 12 News
Why I don’t believe rates should be going up
in voting to hike? Many argue raising
domestic rates can’t curb imported
inflation but Sentance points out it
might strengthen sterling, which
would help. In practice, every curren-
cy analyst I’ve asked dismisses lasting
appreciation of the pound from high-
er base rates.
CNBC COMMENT Sentance also argues the output
ROSS WESTGATE gap is less than imagined by doves. I
agree, but only because most experts,
including current and ex-MPC mem-
T
he Bank of England releases its bers, tell me you can’t measure it. In
latest minutes this week and so which case output gaps as an argu-
the great rate debate continues. ment for doing anything is hopeless.
Will anybody have joined Employment fell in the fourth quar-
Andrew Sentance and Martin Weale ter, wage growth is sluggish, broad
AN EDUCATION IN RISK.
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money growth restrained (around two
per cent), bank lending constrained
(Barclays has cut asset finance to firms
with a turnover of under £5m), house
prices stagnant (at best) and mortgage
lending abysmal. Oh, yes, and we’re
about to launch an cutback in govern-
ment spending with more tax rises.
So against that backdrop, what’s
the argument for raising rates? Not to
cure imported inflation in two years’
time, but credibility. If people begin to
think the Bank is no longer commit-
ted to the inflation target, then it’s
game over for monetary credibility.
But credibility with who? The holders
of over 11m mortgages, of which an
ever greater number are pegged to
variable rates? If credibility is the only
reason for putting up rates then we’ve
already lost it.
Supporters of higher rates, includ-
ing the editor of this publication, also
say they have to rise at some point
from this emergency base, so you may
as well start now. True, if you assume
there’s no risk from a tightening cycle.
But as we saw in last week’s Channel 4
news report on food banks, many
families are on the verge of financial
meltdown. Rate rises now could have
a disastrous impact on sentiment,
that quickly translates into something
far worse. At that point the political
Davies calls for
women to take
20pc top jobs
▲
REGULATION
BY MARION DAKERS
LORD Davies of Abersoch’s review on
gender equality in UK boardrooms
will call on companies to ensure at
least 20 per cent of all directorships
are held by women within two years,
sources familiar with the report said
yesterday.
The government-commissioned
report, due to be published on
Thursday, will also demand that a
quarter of FTSE board members are
female by 2015.
Headhunters and shareholders
will be asked to sign up to a code of
conduct promoting transparency
during recruitment, though the gov-
ernment is thought
to be threatening
mandatory quotas
if the gender bal-
ance fails to
change.
Women cur-
rently hold just 12.5
per cent of all
FTSE compa-
ny director-
Merkel party in Centrica profits
crushing defeat to spark anger
▲
POLITICS
GERMAN chancellor Angela Merkel’s
Christian Democrats suffered a crush-
ing defeat in a regional election in
the city-state of Hamburg yesterday.
The rout, the party’s worst post-war
result, will cost the CDU three seats in
the upper house, or Bundesrat, and
will make it harder for her coalition
to pass laws.
The unexpectedly large scope of the
defeat may cause turbulence for her
party at the national level with six
further regional elections looming.
The CDU fell to 20.8 per cent from
42.6 per cent in the last election in
2008, according to German television.
CITYA.M. 21 FEBRUARY 2011
pressure on the government to offset
tighter monetary policy with less aus-
terity will be overwhelming.
The reality is we’re no longer dis-
cussing whether monetary policy can
impact inflation – we’re arguing over
whether we maintain the pretence
that it can. The narrow two per cent
inflation target (plus or minus one
per cent) is out of date. We should
change the remit to one similar to the
Fed, including growth and employ-
ment – and let us stop discussing mak-
ing futile gestures purely for the sake
of appearance.
Ross Westgate is co-anchor of CNBC’s
Worldwide Exchange. Tweet @rosswestgate
ships.
A survey out today suggests that
two-thirds of women are in favour of
positive action short of quotas to
help improve opportunities for
women to reach the boardroom.
Research by the Institute of
Leadership and Management (ILM)
also shows that while most managers
are against quotas for senior roles, 47
per cent of female managers sur-
veyed said they were in favour.
ILM chief executive Penny de Valk
(pictured with Lord Davies) said: “The
imposition of boardroom quotas in
the UK would be an admission of fail-
ure for leaders.
“Rather than waiting for external
legislation, now is
the time for
employers to set
voluntary targets
for female repre-
sentation at
board and senior
management level,
and hold people
accountable for
m e e t i n g
them.”
ENERGY
CENTRICA, the UK’s biggest energy
supplier, is expected to generate a
storm of controversy this week by
announcing pre-tax profits for last
year of £2bn.
Results on Thursday are likely to
show Centrica’s firm British Gas
made £740m in profits last year, up
from £595m the year before.
Ofgem, the industry regulator, is
due to conclude a review of the retail
energy market next month and criti-
cism of Centrica’s profit could spark a
full competition inquiry. Critics are
likely to point out December hikes for
gas and electricity prices.
CITYA.M. 21 FEBRUARY 2011
Air France may be
considering a bid
for Virgin Atlantic
AVIATION
▲
BY HARRY BANKS
AIR FRANCE-KLM, Europe’s largest
airline by revenue, and Atlanta-
based Delta Air Lines are working
together to examine a bid for Virgin
Atlantic, said various sources yester-
day.
The consortium is trying to tempt
Virgin into joining the Skyteam
alliance, with Goldman Sachs
rumoured to have been tapped as
an adviser.
Virgin Atlantic responded to the
speculation with a statement that
said: “Virgin Atlantic is a strong,
independent business with a good
growth position at both London
Heathrow and Gatwick so we are
not surprised that there is interest
in us.”
The company added that it could
Warner gets ready
for takeover offers
M&A
▲
BY MARION DAKERS
WARNER Music Group is ready to
hear from up to 20 takeover bid-
ders this week, a source close to
the company confirmed yesterday,
as the major label races to the
market ahead of rival EMI.
New York-listed Warner hired
Goldman Sachs last month to
examine its options, which could
lead to the sale of all or part of
Warner, or the firm making its
own takeover bid for EMI.
Private equity vehicles includ-
ing KKR and Russian billionaire
Len Blavatnik are among those
named as interested bidders for
Warner’s businesses, which could
end in a sell-off of its music pub-
Blavatnik may reprise WMG role
▲
PROFILE
BY MARION DAKERS
RUSSIAN-BILLIONAIRE Len
Blavatnik resigned from his direc-
torship at Warner Music Group in
January 2008, blaming his “exten-
sive travel schedule” for his retire-
ment from front-line duties.
But three years later, his plan to
take his finger off the pause but-
ton at WMG has little to do with a
quieter work schedule.
Blavatnik, as a member of
Russian investment group AAR, is
currently waging an international
spat against oil major BP over its
attempts to explore the Arctic oil
not comment any further at this
stage.
Virgin founder Richard Branson
holds a 51 per cent stake in the air-
line, while Singapore Airlines holds
the remainder.
“As a matter of policy, we do not
comment on industry rumours or
speculation about potential airline
partnership,” said a spokeswoman
for Delta.
Air France-KLM was unavailable
for comment.
Virgin Atlantic has long been the
subject of takeover speculation,
with the most recent rumours cen-
tering on a possible bid by Abu
Dhabi’s Etihad Airways.
Prior to that Malaysian carrier Air
Asia boss Tony Fernandes was
believed to have been considering a
bid, after Virgin hired Deutsche
Bank to assess the aviation market.
lishing arm Warner / Chappell or
a takeover of the entire firm.
EMI has also been put up for
sale by new owner Citigroup,
which wrested control from Guy
Hands’ Terra Firma three weeks
ago in a row over its £3.4bn debt
pile.
Warner is thought to be keen to
beat EMI to the market, believing
that there is insufficient appetite
among possible buyers for two
music firms at the same time.
EMI’s music publishing busi-
ness, which owns the rights to
over 1.3m songs including We
Wish You A Merry Christmas, has
a slightly larger back catalogue
than Warner / Chappell, owner of
Happy Birthday To You.
Warner in November posted a
fields with Rosneft.
If BP, AAR and their joint ven-
ture TNK-BP cannot reach an
agreement by March, Blavatnik
can expect a trip to Sweden to
take part in arbitration.
The Russian-born US citizen is
also embroiled in a US lawsuit
against JP Morgan Chase, his long-
time banking partner, over the
bank’s alleged misrepresentation
of mortgage-backed securities
that he claims lost him $98m
(£60.3m) in 2007.
Blavatnik still holds a minority
stake in WMG, and has plenty of
other media experience. He came
close to bailing out struggling
News 13
FLASH CRASH PANEL PLANS NEWS | IN BRIEF
Intel to build $5bn chip factory
Intel plans to build a $5bn (£3.1bn), cut-
ting-edge microchip factory in Arizona
by 2013, sharply ramping up its US man-
ufacturing capacity as part of a major
global expansion. Construction should
kick off in the middle of this year, it said
in a statement.
Toyota to sell home car chargers
Toyota will launch home battery charg-
ers for electric and plug-in hybrid cars
next year as it starts selling new models
of environmentally friendly cars. The
chargers, which will be compatible with
non-Toyota cars, will come in two types,
according to weekend reports. One
would extend from the exterior wall of a
home and the other would be for setting
up in a garage. The company expects to
sell 20,000 to 30,000 units in the first
year, with each costing about several
tens of thousands of yen to 200,000
yen (£1,480) including installation costs.
Australian Seven Media sold
West Australian Newspapers has agreed
to buy Seven Media Group and raise
capital to help pay for the deal, it con-
firmed today. Newspapers had said it
US regulators should stem the growing tide of anonymous stock-trading and consider would buy the broadcaster and maga-
imposing fees on high-frequency traders, said a panel of experts advising how to avoid a zine group for A$3.5bn (£2.2bn). Seven
“flash crash” like the one on 6 May last year. The panel, including Cornell University Media is owned by private equity firm
finance professor Maureen O’Hara (above) suggested the SEC force those that facilitate Kohlberg Kravis Roberts and Kerry
stock-trading away from public exchanges to give investors a better price by a minimum Stokes' Seven Group, which owns more
amount. than 20 per cent of WAN.
wider quarterly loss as revenue
growth in Britain and Italy was
offset by weakness in the United
States, Japan and the rest of
Europe, sending its shares down
eight per cent.
Chief executive Edgar
Bronfman said at the time that
despite the challenges he remains
confident that the music industry
will turn the corner and soon
start to benefit from years of
restructuring and cost-cutting.
A UK spokesperson for Warner
Music Group declined to com-
ment yesterday, while Goldman
Sachs was unavailable for com-
ment.
Warner’s shares closed at $5.92
(£3.64) on Friday, giving the firm a
market capitalisation of $888m.
sports broadcaster Setanta in
2009 but later pulled out, sending
the firm into administration.
Away from his tangled business
portfolio, Blavatnik
finds the time to
sit on the boards
of Cambridge,
Harvard (where
he gained an
M B A )
and Tel
A v i v
univer-
sities.
LEN BLAVATNIK
CITYA.M. 21 FEBRUARY 2011
Huawei in bid to provide free
mobile networks on the Tube
TELECOMS
▲
BY ELIZABETH FOURNIER
CHINA’S biggest telecoms operator,
privately-owned Huawei
Technologies, is bidding to provide a
mobile network for the London
underground system in time for the
2012 Olympics.
The equipment for the network
would likely be provided free of
charge, with tube operator Transport
for London stressing that due to budg-
eting pressures, any such proposal
would have to be funded by the
mobile network companies.
In a statement, Huawei confirmed
it was involved in the bidding process,
and said that the project was a means
of expanding its presence in the UK
market.
The bid is being pitched as a gift
from the previous Olympic nation to
the next, with work guaranteed to be
completed by next summer if the pro-
posal on the table proves successful.
There has long been discussion of
introducing mobile networks to the
underground, but critics have raised
fears over how secure the networks
would be, particularly as mobile tech-
nology can be used to remotely deto-
nate explosives.
Huawei has been particularly keen
to stress its commitment to security,
following controversy over a deal it
did with US company 3Leaf to use its
patents. The deal has been under
review after it failed to meet the
requirements of a national security
review, with Huawei initially refusing
BEST OF THE BROKERS
ANALYSIS l Rentokil Initial
105 p
92.50
100 18 Feb
95
90
22 Nov 10 Dec 4 Jan 24 Jan 11 Feb
RENTOKIL
Standard & Poor’s rates the pest con-
troller “hold” with a reduced 12-month
target price of 105p follow disappoint-
ing results on Friday. The broker sees lit-
tle respite from pricing pressures in the
textile and hygiene business and contin-
ued poor performance from the City
Link division. S&P was also surprised by
the decision not to reinstate a dividend.
NEWS | IN BRIEF
Etisalat deal with Zain at risk
UAE telco Etisalat's $12bn (£7.4bn)
bid for a stake in Zain is in jeopardy
after the Kuwaiti telecoms firm failed
to meet a key condition and a major
shareholder refused to allow more
time for the deal. Zain yesterday
rejected all bids for the sale of its stake most of its downstream businesses in tion of the proposed deal this year and
in its Saudi operations, a key regulato- Africa to two firms for $1bn (£615m), the first half of 2012, Shell said.
News 15
Rumours of
foreign bids
for Invensys
ENGINEERING
▲
BY STEVE DINNEEN
to bow to pressure to withdraw from
the deal and sell the patents. That left
the decision solely in President HUAWEI TECHNOLOGIES ENGINEERING firm Invensys could
Obama’s hands until late yesterday, be the target of a foreign takeover,
when the company finally agreed to with Swiss, French, German and
the recommendation to divest the Chinese firms all understood to be
patents, avoiding a potentially embar- considering bids.
rassing showdown. Potential suitors include Emerson
In its statement on the Tube con- Electric, Siemens, China Southern
tract yesterday the company empha- Rail (CSR) and ABB.
sised: “Our newly opened cyber Sources close to Invensys played
security centre in the UK shows our down the rumours to City A.M., saying
commitment to ensuring our equip- the firm has been linked with
ment meets the most stringent secu- numerous bids over the last two
rity requirements.” Company Huawei Technologies years. No bids had been tabled as of
Huawei has long been a controver- last night.
sial player on the global stage, having Revenue $23.3bn (2008) Analysts have long viewed Invensys
weathered accusations of close ties to as a candidate for break-up, a view
the Chinese military and govern- CEO Ren Zhengfei (left) that chief executive Ulf Henriksson
ment. appeared to endorse in November
But though its founder and chief Previous record Founded in when he said CSR could acquire or
executive Ren Zhengfei was an officer 1988 as a provider of domestic take a stake in the business.
in the People’s Liberation Army and is business telephone exchanges; Invensys, which makes industrial
a member of the National Congress of expanded into Hong Kong in 1996; process automation systems, sig-
the Communist Party of China, the overseas sales surpassed domestic nalling and control systems for rail-
company strongly denies any links sales in 2004. Runs joint ventures ways and various control products
that would raise security concerns. with Siemens, Symantec and for domestic appliances and other
Reports have cited Zhengfei as own- 3Com. applications, made an operating
ing just two per cent of the company, profit of £248m in the full financial
and its statement today stressed that Controversies Settlement in July year ended March 2010.
Huawei is a 100 per cent privately 2004 with Cisco Systems to with- Its operating profit in the last
held global company owned entirely draw products, after it was accused three months was unchanged from a
by its employees. of stealing Cisco technology. Accused year ago.
If the London underground deal of exploiting legal loopholes to re-sign
goes ahead, key Olympic routes employees, thus exempting them from a Invensys chief execu-
including the Jubilee and Central new Labour Contract Law – denied by the tive Ulf Henriksson has
lines are likely to be prioritised. company. Pentagon stated concerns in 2008
French electronics group Thales that it “maintains close ties” with the previously signalled the
has been touted as a potential to People’s Liberation Army, a claim also under firm could be a candi-
instal and maintain the networks, investigation in Australia. date for a break-up.
but has so far refused to comment.
ANALYSIS l Kingfisher ANALYSIS l Reed Elsevier
275 p 263.30 600 p 564.00
18 Feb 18 Feb
265
255 560
245
520
235
22 Nov 10 Dec 4 Jan 24 Jan 11 Feb 22 Nov 10 Dec 4 Jan 24 Jan 11 Feb
KINGFISHER REED ELSEVIER
Citigroup rates the retailer “buy / medi- Societe Generale rates the publisher
um risk” with a target price of 300p. “buy” with a 12-month target price of
The broker thinks the firm is on track for 680p. The broker sees the firm’s
solid growth in the UK and France, increased disclosure of LexisNexis oper-
despite below-forecasts results last ations as a useful way of highlighting
week that were dragged down by slow- unrecognised value in the business,
ing sales in China. Citi has raised its which should ease fears of overexposure
earnings per share for the year by one to the US legal market. SG has raised its
per cent to 19.8p. target by 10p on improved debt figures.
To appear in Best of the Brokers email your research to notes@cityam.com
ry requirement for the Etisalat deal to
the company said. Under the agree-
go through. Abu Dhabi-based Etisalat
ments with Vitol and Helios
had offered to buy a 46 per cent stake
Investment, Shell would retain equity
in Zain last September. in two new joint venture companies to
ensure continued availability of its
Shell to sell $1bn Africa stake products, it said. The three firms would
Anglo-Dutch oil giant Shell has agreed work on securing necessary regulatory
to divest the majority of its stake in approvals, ahead of a phased comple-
 16 News CITYA.M. 21 FEBRUARY 2011

Infrastructure spending is key to City success

connection between building South
African airports or redeveloping
Spitalfields market, and supporting a
successful financial services industry.
Regeneration and reconstruction
can transform communities and cities.
And we must remember that infra-
structure pays for itself. One pound
CITY COMMENT spent on construction brings £2.84
MICHAEL BEAR back into the economy – 92 per cent of
which is spent in the UK.
But such projects must first be
structure, although it will be a peren-
nial challenge.
A significant proportion of invest-
ment over the past 15 years has been
funded via public-private partnerships
(PPPs), which have been responsible for
around 25 per cent of UK public infra-
structure spending.
This means the UK – and the City in
particular – is a world leader in how to
plan, procure, manage and deliver PPP
projects from roads to hospitals, pris-
These countries recognise that deliv-
ering top quality infrastructure is vital
to attract leading institutions and indi-
viduals in a competitive global market.
And they are not the only ones –
India has been spending about six per
cent of GDP on infrastructure over the
medium term, while China has been
spending close to eight per cent.
But in many cases rapid economic
growth continues to outstrip infra-
structure supply.
astonishing. We must think outside
the box and reassert our reputation as
collectors of best practice.
It is a good sign therefore that three
British architectural firms — Atkins,
Arup and Pascall & Watson — are
involved with SBG for the first phase of
Jeddah airport’s reconstruction in
Saudi Arabia.
This huge contract involves a new
terminal building, parking facilities,
an airport hotel and a control tower, to

A
S a civil engineer by trade, I have
seen first hand how improving
and modernising infrastructure
can be a powerful engine for
economic growth and social change.
Working on the demand side of our
business has shown me the intimate
designed, financed, insured, built and
maintained.
The City is a world leader when it
comes to mobilising the capital need-
ed for such large-scale development. In
the last 15 years we have invested to an
unprecedented degree in our infra-
ons to street lighting.
Fresh from leading City business
delegations to Turkey and the Gulf, it
is clear that these rapidly growing
markets are taking major strides
towards becoming global financial
hubs of the future.
Addressing this potential bottleneck
is vital to ensuring long-term prosperi-
ty and so plans such as Abu Dhabi’s
“2030 Vision” or Saudi Arabia’s new
economic cities are crucial.
The opportunities these pro-
grammes offer to British companies is
be completed within 22 months.
British companies working in part-
nership to deliver world-class infra-
structure – a model for future
development in markets far and wide.
Michael Bear is Lord Mayor of the City of
London

US makes move in tax case Targetfollow administrators ready

to finish last round of asset sales
Swiss newspaper SonntagsZetiung. City A.M. that the firm stressed the
▲

REGULATION
BY JENNY FORSYTH The banker is working for Credit employee was a witness, not a defen-

US authorities have arrested a Credit
Suisse banker as a “material witness”
as they investigate other banks that
may have helped Americans to avoid
paying taxes, a spokesman for the
bank confirmed yesterday.
The banker is not allowed to leave
the United States after his arrest two
weeks ago when he entered the coun-
try to meet with clients, according to
Suisse Private Advisors, a unit of
Credit Suisse that is fully licensed
with the SEC to provide banking serv-
ices to US clients out of Switzerland.
The paper also cited an unnamed
Credit Suisse manager as saying the
banker was arrested because of activi-
ties linked to his time before joining
Credit Suisse.
Credit Suisse declined to comment,
however spokesman Mark Dosch told
▲
dant. He added that the US interest
was in activities related to a prior
employer, as the staff member only
joined Credit Suisse in 2009.
Switzerland’s largest bank, UBS,
has faced intense pressure from US
tax authorities over alleged tax eva-
sion since 2008. The bank was prose-
cuted through US courts and forced
to pay a $780m (£480m) fine and
hand over client names.
PROPERTY
ADMINISTRATORS of Targetfollow’s
property arms are set to wrap up the
final asset disposals from the col-
lapsed firm’s real estate portfolio, City
A.M. can confirm.
Deloitte last week appointed agents
to sell Targetfollow’s office buildings
on Prince of Wales Road, Norwich,
which are let to several firms includ-
ing insurer Heath Lambert and RCP
Parking.
In a separate sale, Deloitte is consid-
ering options and offers for nearby
Harford Place, one of Targetfollow’s
biggest assets outside of London.
The £120m sale of the Centre Point
tower to former Land Securities execu-
tive Mike Hussey’s Almacantar is
ongoing, with a formal announce-
ment expected within weeks.

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CITYA.M. 21 FEBRUARY 2011 Analysis 17

All change for the

owners of mid-cap
City stockbrokers Alex Snow of
Evolution Securities
Who is next in the flurry of takeover attempts such as Evolution
Securities’ courting of Panmure Gordon,
(top), Keith Harris of
Seymour Pierce (below,
M&A changing the shape of which has recently struggled with losses.
For others, the solution to the challeng-
left) and Graeme
Summers of Brewin
broking firms, asks Alison Lock ing environment has been to move the
business away from broking services.
Dolphin (below, right)

For Brewin Dolphin, for example, selling

its investment banking arm has allowed it

M
ID-MARKET City brokers have had
a tough recession, and it shows in
a series of M&A deals reshaping
“There is a lot
the sector.
Two hit the spotlight for different rea-
of talk about
sons last week: Brewin Dolphin received
much acclaim for selling its 55-man
the market
broking arm to Spanish investment man-
ager N+1 for £5m, leaving it free to focus on
being
its asset management business.
Seymour Pierce has been less fortunate:
overbroked –
its £60m merger with Bermuda-based
Gerova Financial Group looks shaky after
it is
Gerova was hit by management troubles.
Chairman Keith Harris says the deal
overbroked”
remains on track but it is understood that
negotiations have stalled for the moment.
They are just the latest in a spate of M&A
that has seen small brokerage firms being
taken independent or becoming takeover
targets. So what’s causing it?
The financial crisis has been a large part
of the problem, as the brokers’ core work
froze in the credit crunch and is only now
starting to thaw.
“The volume of M&A, stock trading and
capital fundraising has decreased signifi-
not only to exit the crowded broking mar-
ket but to refocus on investment manage-
ment, an industry with steadier returns
and fatter margins.
Several sources agreed that finance
houses highly dependent on broking
income could benefit from such a shift.
“Companies need to make a strategic
change. There is a difference between
changing your business strategically and
just getting new financial backing,” one
said. He was also sceptical that the current
M&A would create a more consolidated
market. “If anything the market has
become more fragmented, not more con-
solidated,” he said, citing Lehman
Brothers’ split into Nomura and Barclays.
Other brokers with specialist expertise
have been snapped up by international
banks. Execution Noble was bought by
Espirito Santo Investment Bank in
November to add emerging markets
expertise and a London presence to the
expanding Portuguese bank.
But with many mid-cap brokers either
independently-owned or AIM-listed, the
market remains ripe for further deals.

cantly – so the sector has been suffering
from overcapacity relative to demand, par-
ticularly within the mid-market,” one
source close to Evolution Securities said.
Others put it more bluntly.
Cheltenham
One source suggested that Arden
Partners, an AIM-listed broker with strong
links to markets such as India and a mar-
ket capitalisation of about £13m, would
make a good takeover target.

“There is a lot of talk about the market
being overbroked – it is overbroked,” a
source close to Peel Hunt said.
This has particularly hurt brokers
focused on the AIM market, where the
number of companies has fallen more
than a third since 2007 from 1,347 to 946
in January this year, John Borgars, an ana-
lyst at Equity Development said.
“There has been a massive decline in the
AIM market and that has put pressure on

-POEPO
&$7
/%
the brokers,” Borgars said.
The need to boost market share saw
KEY PLAYERS | MID-CAP CITY BROKERS
NAME FOUNDED PARENT COMPANY
in theCity
Altium Securities and Finncap were
also named as successful and well-posi-
tioned candidates worth consideration.
Nick Finegold, now co-chief executive of
Espirito Santo Investment Bank, said he
believed smaller brokerages would eventu-
ally get drawn into bigger banks.
He said: “Smaller companies never see
themselves as being very small for very (SFFOmT
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 18 News
Legal eagle: how London’s top law
firm retained its grip on the City
Slaughter and May
senior partner Chris
Saul believes that
lawyers are becoming
the advisers of choice
T
he head of law firm Slaughter and
May is two minutes late for his inter-
view with City A.M., for which he
immediately apologies. The first
thing is surprising; the second is not. The
partners in this blueblooded City institu-
tion have spent a lifetime doing things
correctly.
Even among other Magic Circle outfits,
this firm manages to hold a singular aura.
Much of this is down its status as the most
profitable law firm in the City.
Last year the partnership posted sales
widely estimated at £439.5m (the firm
does not publish its accounts), which are
roughly half that of larger rivals such
Linklaters or Clifford Chance. Yet
Slaughters was still able to pay its 126 part-
ners an average of £1.84m for their efforts,
among the highest in the industry.
It is able to do this partly because it did
not expand overseas like its rivals did a
decade ago, which means when times are
bad it does not carry large overheads or is
forced to cut large numbers of staff. The
business has not let any of its 1,200 staff
(including 733 lawyers) go since the finan-
cial crisis began. It retains a close-knit,
unique culture; Slaughters remains an
unlimited liability partnership.
But the main reason for its success is
down to the way its lawyers work and the
enviable list of clients it retains. This busi-
ness acts for an astonishing 28 FTSE 100
companies, more than any other rival; its
clients include Marks & Spencer and
Unilever. In total the firm is retained by
111 listed businesses.
It has also long excelled at getting gov-
ernment work. In the 1980s, under
Margret Thatcher’s Conservative govern-
ment, it won lucrative mandates to work
on many of the country’s biggest privatisa-
tions, including British Aerospace, BP,
British Telecom and British Steel. And dur-
ing the banking crisis it acted for Gordon
Brown’s Labour government to set the
legal frameworks for the bailouts of
Northern Rock, Lloyds Banking Group and
the Royal Bank of Scotland. It earned
£22m for this work; its next nearest legal
rival earned under £1m in fees from the
CV | CHRIS SAUL
Age: 54
Work: Trainee, Slaughter and May: 1977-
79; corporate assistant: 1979-86; elected
partner: 1986; head of New York office:
1991-94; elected head of corporate: 2003;
elected senior partner: 2008
Education: Tiffin School, Kingston-upon-
Thames; St Catherine's College, Oxford
Family: Married, two children
Lives: Notting Hill
Hobbies: Drives a 1973 Porsche 911, a
Renault Mégane and has a half share in a
Lotus 211. Listens to a lot of Joan As
Police Woman, Crosby Stills and Nash and
Vampire Weekend. Reads a lot of fiction
government for this work.
The profit margins that Slaughters can
command for high profile work of the
kind it took on during the banking crisis is
understood to be around 50 per cent.
“There are two key drivers behind this,”
says Saul, 54, an engaging and trim man,
who is sitting in one of the firm’s tasteful
meeting rooms on the first floor of its
Moorgate headquarters. “The quality of
the team here and the genuine sense of
collegiality among the partners. These fac-
tors mean that we are able to advise cre-
atively and proactively on some of the
most challenging deals, financings and
disputes.”
He also adds that importantly, lawyers
at Slaughters are trained as “generalists”
in all areas of the law, so when the lucra-
tive mergers and acquisitions side of the
business slows down they can turn their
hands to restructurings, regulation or
competition law. We are not stuffed full of
“deal junkies” here, jokes Saul, who was
elected as senior partner in 2008 for a five-
year term.
Saul says that being a good general cor-
porate lawyer means that “at 3.00am,
when a deal is about to be signed at
7.00am and someone rushes in and asks
‘what about the negative pledge?’, there
isn’t a ghastly silence. A client wants to be
able to look at his or her lawyer and expect
the lawyer to know what that means. You
don’t want the lawyer to say ‘I just have to
call my bonds person about that’”.
For the forgetful among you, the pur-
pose of a negative pledge in loan agree-
ments is to ensure that other creditors do
not secure a preferred claim over the
assets of the debtor in the event of insol-
vency.
In common with most Magic Circle
firms, Slaughter’s corporate and finance
departments account for the lion’s share
of its profits; estimated at 65 per cent of
sales, though its much smaller tax and
WORDS BY ROGER BAIRD
Slaughter and May’s competition departments also enjoy
senior partner strong reputations.
Chris Saul at his firm’s Instead of opening up offices abroad
City headquarters at the firm has, for more than the last ten
One Bunhill Row years, pursued what it calls its Best
Friends strategy. Slaughters has estab-
Picture Alex lished a loose network with other top law
Ridley/City A.M. firms like Hengeler Mueller in Germany
or Cravath, Swaine & Moore in the US,
who cooperate where they can and pass
on business to each other.
When times are good, critics tend to
complain that multinationals want to
deal with a single law firm that can han-
dle its business across a variety of territo-
ries. But in tough times like these,
observers concede that Slaughters does
not have to retrench as much as its rivals.
Saul says: “Over the last three years, our
more flexible model has been particularly
helpful. It has enabled us to respond
quickly to major economic, business and
regulatory developments.” He adds that –
for this very reason – a merger with any
firm in the network is not on the agenda.
Slaughters has only had two offices
abroad for some time – in Hong Kong and
Brussels – but 15 months ago it opened a
third in Beijing.
“There is Saul says: “We sat down and thought
about this two years ago. We have a signif-
pressure on icant investment in our Hong Kong office
and an increasing amount of our work
private equity was China-facing. So we felt that we
should be in mainland China both to con-
sponsors to solidate and grow our China work and to
promote the continued growth of our
exit from Hong Kong office. Also, an office in
Beijing means that we are close to the
businesses Chinese firms and this enables us to build
ever-stronger relationships with them.”
and put Slaughter’s senior partner, in common
with most professional services firms that
capital to depend on corporate action for fees, is
“upbeat but guarded” about the prospects
work.” for the year ahead.
Saul adds: “Corporates have cash on
CITYA.M. 21 FEBRUARY 2011
“There is now
a greater
appreciation
that bad stuff
happens. This
has helped
the stock of
all legal
advisers,
internal and
external, to
rise”
their balance sheets, the debt markets
continue to recover and, after some heroic
cost cutting, many businesses will look to
mergers and acquisitions for growth.”
He adds: “There is also pressure on pri-
vate equity sponsors both to exit from
long held businesses and to put capital to
work.”
However, Saul acknowledges that the
market is fragile, adding that a Eurozone
sovereign debt disaster, a Middle East cri-
sis or rising inflation “would lead to a loss
of confidence in the equity markets”.
The senior partner also thinks that
lawyers will become increasingly central
to any deals that do come along as a conse-
quence of the financial crisis. Firms will
want more protection if a deal unravels,
and they are dragged into court.
Saul says: “A few years ago, deals were
struck where people thought that they
would never have to get the documents
out of the drawer. But the world has
changed and clients have had to open that
drawer – and have sometimes found that
they have agreed to things which they
would have preferred not to.”
The recent BP-Rosneft deal is a recent
case where lawyers – rather than big
banks – have taken centre stage in a deal.
It was specialist oil adviser the Lambert
Energy Advisory and the oil majors’ law
firms Linklaters, for BP, and Freshfields
Bruckhaus Deringer, for Rosneft, that put
the joint venture together.
Saul says: “There is now a greater appre-
ciation that bad stuff happens and that a
balanced assessment of risk at the outset
is key. This has helped the stock of legal
advisers, internal and external, to rise –
not so much as lawyers but as advisers.”
Regardless of whether lawyers’ new
influence is permanent or merely a cycli-
cal phenomenon, one thing is clear:
Slaughter and May, one of the City’s true
powerhouses, will continue to box well
above its weight.
CITYA.M. 21 FEBRUARY 2011
CITY MOVES | WHO’S SWITCHING JOBS
Kinsey Allen International
The global executive search firm has appointed
DiAnn Ferguson to launch its asset manage-
ment practice in San Francisco. Ferguson will
focus on mandates within the asset manage-
ment sector on the west coast of the US. She
has over 20 years experience as a trader, bro-
ker and search consultant in London, continen-
tal Europe and the US. Her experience as a
trader and a broker has given her in depth
knowledge of capital markets.
tancy has announced the appointment
Alexander Proudfoot of Stephen Brewer to lead its telecoms
The operational improvement consul- practice. Brewer was Vodafone’s man-
To appear in CITYMOVES please email your career
SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
updates and pictures to citymoves@cityam.com
Travelodge sales grow 13pc
TRAVEL robust performance whilst continu-
▲
BY JENNY FORSYTH ing our strategic UK growth pro-
gramme and demonstrating
BUDGET hotel chain Travelodge is set Travelodge’s continued strong recov-
to report a 13 per cent sales growth ery.
for last year, with a forecast for fur- “We served record numbers of cus-
ther expansion this year. tomers, grew total sales and opened
The chain will today announce like- 70 new hotels in excellent locations,
for-like growth of six per cent, led by targeting sites that would have been
11 per cent growth in London, and a beyond our reach before the reces-
total of 7.2m room sales, with 13m sion. The deal with Mitchells and
customers, up 12 per cent from the Butlers, which saw us acquire 52 of
previous year. their hotels, shows the innovative
Chief executive Guy Parsons said approach we have taken towards our
that, despite the impact this year of
the VAT increase and fuel and energy Travelodge chief execu-
price rises, 2011 trading is in line with tive Guy Parsons said
management expectations and the
firm was “confident on the longer the firm had delivered
term outlook”. a robust performance
Parsons said: “Despite the tough cli- in 2010
mate in 2010, we have delivered a
Partial G20 accord to give moderate lift to shares
MARTIN ON big surprises.
GFT is quoting the FTSE 100 index to
open up five points from Friday’s close,
THEMARKETS at a level of 6,087. Elsewhere in Europe
the German Dax is called up seven
points at 7,433, and the French CAC is
quoted up four points to open at 4,161.
Although a compromise deal was
struck on common indicators to judge
global economic imbalances, China
succeeded in blocking moves to use
exchange rates and currency reserves
as criteria to measure the imbalances.
The outcome will be received with at
best subdued enthusiasm, while scep-
MARTIN SLANEY tical traders will see it as little more
than preserving the status quo.
But some money was clearly off the
mildly positive start is expected table ahead of the weekend, with mar-
A
for stock markets this morning, kets taking a breather in case any
as risk appetite returns after a unexpected disruption materialised.
G20 summit that resulted in few Any return of risk appetite will how-
WALL STREET WEEK AHEAD
I
nvestors will continue to ride the “I’ve never seen a market like this,”
speediest rally in US stocks since said Paul Mendelsohn, chief invest-
the Great Depression despite ment strategist at Windham
growing concerns the market is Financial Services in Vermont, a mar-
overbought and due for a correction. ket watcher for 35 years.
Wall Street posted its third consec- “I’m showing, by every technical
utive week of gains with the S&P 500 and quantitative standard I have, this
now up 6.8 per cent for the year and market is at extreme levels. But no
more than 20 per cent in just six matter where we start out in the
months. morning, buyers come in.”
Edited by Elizabeth Fournier
aging director for sales and distribu-
tion before moving to Cable and
Wireless as chief executive for their
Caribbean operations. Most recently he
established a new business for Digicel
in Trinidad and Tobago. Before joining
the mobile telecommunications indus-
try, Brewer worked in the computer
industry, having been a founding board
director of Apple Computer UK, and
head of European operations for
ComputerLand.
RBS Wealth Division
Ian Ewart has been appointed director
of marketing for RBS Wealth Division.
aggressive growth plans.
“With a continued focus on driving
growth this year, we have already
opened four hotels and are currently
building a further 36 hotels. We are
creating 725 new jobs, and ensuring
we are well on track to reach over
1,100 hotels and 100,000 rooms by
2025.”
Over the last five years Travelodge
has focused on city centre growth in
an effort to move away from roadside
locations. Eighteen per cent of its
rooms are now in London, with 62
per cent in major towns and cities
and 20 per cent in the traditional
motorway or roadside spots.
Travelodge, which has 450 hotels
in the UK and 13 abroad, said 87 per
cent of reservations were made at
travelodge.co.uk last year, with rates
starting at £19.
ever likely be tempered by continued
tensions in the Middle East, with
reports of up to 200 people killed in
Libya as the government cracks down
on protesters, and violence in Yemen.
The other focus this week will be
minutes from the Bank of England’s
MPC meeting on 9 February. Rumours
were circling the City on Friday that
another member had voted for a rise
in rates, increasing the likelihood of a
rise in the near future.
Martin Slaney is GFT’s director of global
dealing operations.
The trend of stocks starting off
lower in the morning session but end-
ing higher by the afternoon has been
ongoing for weeks as investors view
the small dips as reasons to buy.
But there is a perceptible level of
anxiety in the market. Trading vol-
ume has been exceptionally low
recently and the CBOE Volatility
Index, Wall Street’s so-called fear
in association with
Ewart will be responsible for the mar-
keting and communications strategy
across all of the RBS Wealth Division
brands including Coutts & Co, RBS
Coutts, RBS International and Adam &
Company. Ewart was most recently
head of international marketing at Bank
of America Merrill Lynch and joins RBS
as a leading industry expert in private
banking marketing management. He has
also held a number of senior marketing
positions, notably at Barclays Wealth
and HSBC.
Peel Hunt
The independent broking and advisory
Fewer office deals at close
of 2010 for Central London
PROPERTY
▲
THE CENTRAL London office market
saw a patchy end to 2010, according
to research seen by City A.M., with the
total number of deals in the fourth
quarter down 19 per cent on the same
time the previous year.
Large office rent deals for JP
Morgan, Bloomberg and BNP Paribas
made up almost half of the 4.5m
square feet of space taken, said fig-
ures compiled by Equipe Real Estate.
The Square Mile fared even worse
than the London average, with deals
down 31 per cent compared with the
previous quarter and the number of
contracts signed for small offices of
less than 50,000 square feet falling
ANALYSIS l FTSE
6,100
5,900
5,700
5,500
22 Nov 10 Dec
ANALYSIS l DAX
7,500
7,300
7,100
6,900
6,700
22 Nov 10 Dec
gauge, is up on the week despite the
gains in stocks.
The index is usually inversely corre-
lated to the S&P 500, and a rise in the
VIX typically means a drop in the
stock market.
The VIX, which ended at 16.43, up
4.7 per cent on the week, is still low
but substantially higher than in
recent months. It suggests investors
News 19
firm has hired Andy Crossley as head
of corporate sales and syndication.
Crossley has over 25 years of experi-
ence in the City and was previously
with Invesco Perpetual for 20 years,
managing institutional funds and
investment trusts including the UK
Smaller Companies Growth Fund.
Crossley started his career as a credit
analyst with Midland Bank in 1986,
moving to become a corporate credit
analyst at the United Bank of Kuwait a
year later. In 1989 he joined Guinness
Mahon Asset Management as a UK
smaller companies manager responsi-
ble for two unit trusts.
+44 (0)20 7557 7245
morganmckinley.com
back to levels last seen in early 2009.
West End office deals were eight
per cent down on the previous quar-
ter – the area’s fifth consecutive
decline, despite annual take-up rising
13 per cent to 4.6m square feet.
In the City, banking and financial
firms made up just nine per cent of
office moves, after Bloomberg skewed
figures in favour of business services
with its deal to build new headquar-
ters on the Bucklersbury House site
near Bank station.
“The full year statistics are positive,
but detailed analysts shows that the
market is still delicately poised,” said
Equipe’s researchers. “We are cau-
tiously optimistic.”
6,082.99
18 Feb
4 Jan 24 Jan 11 Feb
7,426.81
18 Feb
3 Jan 21 Jan 10 Feb
see more share gyrations ahead.
The driving force behind the rally is
the money that poured into riskier
assets like stocks in the last quarter of
2010 after the US Federal Reserve
pledged to keep interest rates low.
About 7.13bn shares traded on the
New York Stock Exchange, NYSE
Amex and Nasdaq on Friday, below
last year’s daily average of 8.47bn.
 Wealth Management
20
S&P 500 is
on a great
rolling boil
Donata Huggins asks if the US
stock market is nearing a top
B
RING up to a rolling boil then leave
for…. How long exactly? That is pre-
cisely the question that spread bet-
ters everywhere are asking about
the S&P 500. It’s been climbing for two
years now, smashing through glass ceil-
ings like a highly caffeinated new-age
woman. But – realistically – how long can
the rally last?
The technical analysis whiz kids say it is
a difficult call. David Jones of IG Index
thinks it could just keep going: “The easi-
er money is on running the long bet for
the meantime, trying to pick a top could
be an expensive game.” He thinks a sensi-
ble strategy is to buy whenever the num-
ber dips slightly.
Michael Hewson of CMC Markets has a
more cautious view: “The S&P needs a
good 5-10 per cent shake out, back down
to the 12,700 level, but trying to pick a top
is a fool’s game.” Quoting Keynes he says:
“Markets can remain irrational longer
than you can remain solvent.”
That said, Kully Samra of Charles
Schwab thinks quite differently. He says
the rally is the outworking of good funda-
mentals: a combination of healthy-look-
ing US economic indicators, money
flowing into US equities and the fact that
we’re in a pre-election year should mean
there is plenty of potential for a move
higher.
Fascinatingly, Samra explains that the
US has not experienced a pre-election year
when US stocks were down since 1945. So
far, this year is certainly not bucking this
long-established trend.
CITYA.M. 21 FEBRUARY 2011
| Spread Betting
THE TIPSTER
DRAGON OIL
A ROARING
GOOD BET
ECENTLY downgraded to “hold”,
R investors have not been deterred
from Dragon Oil which will be
publishing interim results tomor-
row. As the crisis in the Middle East
unfolds, and stop-gap governments
evolve, oil prices, which have seen a cor-
rection since last week, should carry on
rising and the sector continue to per-
form. Cantor Index offers a daily spread
of 552.3p-554.3p
Defense company BAE Systems has
been falling despite reporting full year
earnings in line with expectations.
Government spending cuts in the UK
Getting the timing and US will affect the company; howev-
right is never as easy er, it ought to be able to develop or
as it looks grow fresh sources of revenues in other
countries, including Saudi Arabia.
Although investors have become
nervous, it should be noted that BAE
still managed a pre-tax profit of
£1.49bn in 2010 against a £61m loss in
2009. Capital Spreads quotes 335.6p-
336.2p.
Lloyds and RBS got a boost last week
after positive broker recommendations.
RBS shares have shot up some 16 per
cent since 1 February, with Lloyds
shares lagging behind with only a 8.3
per cent gain.
This has opened up a pairs trade oppor-
tunity to sell RBS shares and buy
Lloyds, as the pairs spread is out of line
“Sure people keep talking about the explains. “You have to have the recovery with historical levels. One to watch,
lack of jobs that have been created in the before the jobs are created,” with Lloyds expected to report healthy
US, but employment is always low when Hewson is less optimistic. “The state of earnings on Friday. Spread Co offers a
the economy starts to recover,” Samra the US is difficult to guess because the spread on Lloyds of 68.60p-68.72p and
inflation figure is not an accurate reflec- RBS of 48.34p-48.46p
ANALYSIS l The performance of the tion of the state of inflation – it excludes XP Power is reporting on Monday
S&P 500 year to date food and fuel – the most important fac- and the price is up 3 per cent ahead of
1,340
tors. People have always got to eat and the figures. WorldSpreads is quoting
drive.” But he says that the extra cash 1,534.1p-1,561.9p in the Rolling Market.
1,320 quantitative easing has created could After announcing a fourth quarter
mean there is potential for another wave loss a couple of weeks ago, German
1,300 of mergers and acquisitions – something pharmaceutical company Merck is
that will bring even more investors into expected to post its full year profits
the US market. today and investors will be keeping a
1,280
For now, we will have to wait for the close eye on guidance for 2011. CMC
S&P’s boiling point. And – as so often the Markets is offering a spread of
1,260 case when cooking – trying to predict the €62.593-€62.737
Source: Yahoo! Inc
0 moment the pan boils over is difficult. It Craig Drake
2011 Jan 10 Jan 18 Jan 24 Jan 31 Feb 7 Feb 14
will happen as soon as you look away.
THE WEEK AHEAD in association with
COMPANY NEWS COMPANY NEWS MARKET NEWS POLITICAL NEWS
l The week’s slew of annual l Thursday will also see More l Tomorrow, the Office for lThe House of Commons will not
reports will begin on Monday. Than parent company RSA National Statistics will be sitting this week as it is
Hammerson, which invests in and Insurance announce its fourth release producer closed for half term.
develops shopping centres, retail quarter profits on Thursday. It is prices and public MPs will be back to
parks and offices throughout expected that they will be hit by sector finance play next week.
Europe, will kick things off. claims resulting from the winter data.
freeze. lIreland will be
l On Tuesday, building and l On going to the ballot
plumbing equipment maker l Energy giant Centrica is expect- Wednesday, the box on Friday
Wolseley will issue a ed to announce a 29 per cent US Department where it is expect-
trading statement. rise in annual profits on of Housing will ed that independ-
Thursday. release a report of ents will make a
l Wednesday sales of existing strong showing.
will see invest- l Bookmakers homes in January.
ment man- William Hill will be lSouth African Finance
agement betting on good l Wednesday will also see the Minister Pravin Gordhan will
company results when they release of minutes by the Bank of deliver his budget speech in the
Henderson announce their prof- England from February’s Cape Town parliament on
Group release its on Friday. Monetary Policy Committee meet- Wednesday. Economists are not
its full-year ing. expecting any significant changes
results. l In other gambling to tax rates.
news, Rank Group will be l On Thursday, European Union
l Part-nationalised hoping for a full house of prof- economic confidence data for l Banks will re-open in the Ivory
banks RBS and Lloyds will its from its turnaround of Mecca February will be released along Coast on Monday, having been
report their annual performances on Bingo when they round out the with industrial confidence data for nationalised by Laurent Gbagbo,
Thursday and Friday respectively. week’s annual reports on Friday. the month. who still clings on to power.
CITYA.M. 21 FEBRUARY 2011 Wealth Management 21

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 Lifestyle
22 In association with CITYA.M. 21 FEBRUARY 2011

| Travel

2011 is the year that London becomes the

world’s best place to stay
Zoe Strimpel and Timothy Barber guide you through the new crop of wow-factor hotels

J
UST when it seemed as though
London couldn’t fit another
slice of luxury into its five star-
crammed hotel scene, along
comes… well, everything.
This has been a huge year for the
capital. The completion of the spec-
tacular £200m refurb of the Savoy
sparked the buzz of excitement.
Since then, Park Lane has seen the
rebirth of the Four Seasons, complete
with a multistory, windowy spa and
top-of-the line Italian restaurant. The
W has transformed its corner of
Leicester Square with futuristic
design that screams: “We are young,
we are free…oh, and we’re very rich
and like to party”, and includes a
restaurant by the legendary Jean-
Georges Vongerichten, fresh from
New York.
St Pancras has been a never-ending
source of wonder since it got the
Eurostar – now, a wonderful Marriott
Renaissance hotel and restaurant by
Marcus Wareing that fully use the
station’s stunning Victorian architec-
ture are further revolutionising the The Victorian finery of the St Pancras
area. The Corinthia in Trafalgar Renaissance hotel makes this one of the
Square and stately home Syam Park most exciting openings of the year.
(by Waldorf Astoria) seal the deal: this
is truly the year to sleep, spend and
party in London.

The Corinthia Hotel

UILT as a grand hotel in 1883 to be found in the superbly named

B between Whitehall and the

Thames, the
Metropole hotel has
been salvaged from 60
years spent as overspill
former
Bassoon bar. The go-to man for ultra-lav-
ish restaurant and bar interiors,
David Collins, is putting his
touch on both the
Bassoon bar and the
offices for the Ministry Massimo Restaurant
of Defence. Reborn as and Oyster Bar,
the Corinthia – part where Italian chef
of a group of hotels Massimo Riccioli
in cities including will be aiming to
Prague, Lisbon and make an impact
St Petersburg – it’s with his seafood
set to be a place of creations.
maximum opulence And let’s not for-
when it opens in April. get the spa, ESPA
Of particular interest Life at Corinthia –
are the signature suites four floors of sumptu-
occupying the building’s eye- ous pampering facilities,
catching turrets – each is themed including a Daniel Galvin salon.
after a different historical figure, and is Apparently there’s a library of 25,000
served by its own internal lift. The Royal films for clients to use as a reference for
Suite is claimed to be the largest in their hair and make-up styles.
London. Best for: Glamourpusses, urban sophisti-
For mere mortals, there will be fine din- cates and cocktail-drinking bassoonists.
ing and cocktails galore to enjoy, the latter www.corinthia.com/london
CITYA.M. 21 FEBRUARY 2011
Four Seasons Park Lane
HE glass-walled rooftop spa, with
T its 360-degree views, is quite possi-
bly the most striking aspect of the
Four Seasons, just reopened after a
two-year, £125m refurbishment. You can
run on the treadmill while looking at the
Houses of Parliament in the distance, or
have a light spa lunch in a light-washed
lounge following a treatment in a private
pod.
But everything else about this big, sleek
hotel – with front row seats on Hyde Park –
is exquisite and a fitting representative of
St Pancras Renaissance
XPECTED to open in May,
E Marriott’s latest is one of the most
exciting hotels to arrive in London
this year. Like many of the others, it
involves restoration and renovation, but
the sheer scale and grandeur of the
Victorian building in which it is housed
beggars belief. Originally built in 1873 by
the legendary Victorian architect Sir
George Gilbert Scott, the hotel has been
lovingly restored to its former glory and
will feature the Ladies Smoking Room, the
Booking Office Bar and the Gilbert Scott.
The W
OCATED on the site of the old
L Swiss Centre, the W, the first
London outpost of a worldwide
brand associated with bling style,
came to life as Starwood Hotels partner
McCleer & Rushe Group bought and rede-
veloped the site for £200 million in 2009.
Since opening on Valentine’s Day (14 Feb,
2011), the W has lit up the formerly dingy
Leicester Square with disco-ball razzle
dazzle. On entering, thousands of glitter
balls refract light; hedonistic lounging
options await you at every turn and
In association with
the always stellar Four Seasons brand.
Rooms have park views or look out on
Mayfair’s little streets. They’re all finished in
high-gloss contemporary elegance, but
veer more towards the corporate than the
characterful.
Amaranto, the hotel’s restaurant, is high
glam. Think black marble, dark wood and
leather, red chairs and alcoves, floor-to-ceil-
ing windows and a massive wine wall fea-
turing some of the restaurant’s 400 wines.
Best for: business travellers with a pen-
chant for something a little sexier and
The latter is Marcus Wareing’s foray out of
Michelin-starred cuisine and promises to
be a fantastic cocktail bar and British
restaurant with a heritage twist (the menu
will take its pies very seriously).
There are 245 bedrooms. Of these, the
most exciting are the 38 Victorian suites
full of period features such as high ceilings
and tall windows. Better still is the
Presidential Suite – the former Venetian
Ballroom – with three bedrooms and lavish
lounge area. The grand staircase is a won-
derful touch: a three-storey masterpiece
everything has a super-modern, almost
futuristic feel. Rooms are classifed thus:
Fantastic, Fabulous, Spectacular and – at
the very top – E Wow.
Food is set to be a big deal here, with
Michelin-starred chef Jean Georges
Vongericht presiding over the Pan-Asian
Spice Market. And for those who want
really splashy glamour, there’s Wyld (as
in, one supposes, wild), the bar that will
be a major venue for film premiere par-
ties. Indeed, film nuts can enjoy a 38-
seat 3D screening room in the hotel.
23
CLAUDE BOSI’S NEW
GASTROPUB
REVIEWED IN
LIFESTYLE TOMORROW
The Victorian finery of
the St Pancras
London Syon Park
Renaissance hotel
makes this one of the ANCY a luxurious coun- suites with their own pala-
most exciting
openings of the year.
F try hotel in the middle
of the city? With a
butterfly house in
the lobby to boot? No
problem. Syon Park, on
tial theme; a swimming
pool and extensive spa
– celeb surgeon Alex
Karidis will be offer-
ing “discreet” treat-
the other side of the ments – and an
Thames from Kew ice-cream parlour.
Gardens, is a 200-acre But perhaps the
country estate designed most appealing
by Capability Brown, and aspect will be the
home of the Robert Adam- access guests will have
designed Syon House, the to those magnificent and
London seat of the Duke of historic gardens. As romantic
Northumberland. ideas go, dinner under the trees with the
The new Waldorf Astoria hotel (the view out over the lawns to the river and
Hilton group’s top-level group of luxury across to Kew is something unlikely to
hotels) has been built within the grounds be matched in London.
of the estate and contains 137 gue- Best for: Seekers of tranquility, beauty
strooms. As well as the lobby butterfly and history rolled into one.
house, the hotel contains several luxury www.waldorfastoria.com
Mint Hotel – Tower of London
HE City of London’s largest spot to host clients and cus-
T hotel opened just short-
ly before Christmas,
though the name
has nothing to do with its
proximity to the Royal
tomers from out of town,
and as you’d expect, the
business facilities are
spot on. Furthermore,
the views out over
Mint. The name is actual- Tower Bridge, the
ly a rebrand for the less- Tower of London
than-glam business hotel and the City are as
group City Inn, and this impressive as they
newly-built place shows come, and the best
just how sophisticated and place to catch them is
stylish a 21st century business from the rooftop bar, the
hotel can be. SkyLounge. With swish cock-
It’s huge, with 583 rooms, and there’s tails and a useful rooftop garden
an iMac entertainment system and free area, the SkyLounge is a destination in
WiFi in each one, and there are a couple itself and a smart addition to the Square
of extensive suites – living room, dining Mile’s nightlife scene.
area, separate bedroom and dining room
– for big spenders.
Best for: Square Mile visitors wanting a
bit more from their hotel than a confer-
Location is key. The hotel is right by ence room and an internet connection.
Tower Hill tube station, making it a good www.minthotel.com
THINK ROOMS... with
more intelligent than your usual corporate The Savoy 5*
luxury – and who require good fitness facil- The Strand | London | WC2R 0EU
ities. www.fourseasons.com
Following the most ambitious hotel restoration in
British history, The Savoy re-opened last year to
reclaim its legendary status amongst the world’s
top hotels. Blending the Edwardian, the Art Deco
and the contemporary, its timeless elegance shines
through once more. The entrance is as iconic as ever
and Gordon Ramsey oversees the Savoy Grill – this
place is back where it belongs.
51 Buckingham Gate 5*
London | SW1E 6AF
We reckon the world-class suites and serviced
apartments of 51 Buckingham Gate offer more
that will make you feel you’ve stepped than five star luxury. In the heart of Westminster
back in time. Best for: Those who love the surroundings are prestigious, the interiors cool
London and history. www.marriott.com and contemporary, and The Quilon Restaurant here
is Michelin starred. Oh, and the tranquil Spa at 51 is
the only spa in London to offer Anne Sémonin treat-
ments!
The Marylebone Hotel 4*
47 Welbeck Street | London | W1G 8DN
There’s a distinct boutique-style feel to The
Marylebone Hotel, adding a wonderful touch of
character to its understated luxury. This individual
flair is matched by the hotel’s location in trendy
Marylebone village too – full of the sort of quirky
and unique shops we love. And it’s also just a short
walk from many of London’s main attractions.
Best for: Tourists and urbanites who
want a hyper-glam, partylicious
London experience, right in the hustle To book your stay at any of these fabulous hotels, or to discover a whole world of other
and bustle. www.wlondon.co.uk accommodation possibilities, visit LateRooms.com or call 0161 831 3894.
 24 Lifestyle CITYA.M. 21 FEBRUARY 2011

Hollywood Hotspots:
How to do LA like
a star in 24 hours
tastiest meal at the hotel’s Culina: for
With the Oscars on Sunday, starters a delicious crudo sampler, fol-
lowed by a spaghetti alla chitarra and a
Kohinoor Sahota shows you all roasted salmon with black cucumber and
rice. Sit amongst the lemon trees and
you need to know to be a groupie overhear power lunches. The latest press
events happen here: last month it was the
BAFTA Tea Party attended by Oscar nomi-

A
S celebrities flock to Los Angeles nees Helena Bonham Carter and Colin
for the Oscars, we found the
hotspots that they’ll be eating,
If you’re still Firth.
Sadly, the closest you’ll probably get to
drinking, and (not) sleeping in
before the big night. We first checked into
not satisfied, going to the Oscars will be touring the
Kodak Theater, which has been hosting
the Hollywood Roosevelt, which oozes old
school glamour. Live like Marilyn Monroe
follow Harry the ceremony since 2002. Relax in the VIP
room, say a speech onstage, and walk the
in suite 229 where she resided for two
years, or head to the Blossom Room where
Cohn’s advice: Winner’s Walk that Oscar recipients take.
Now it’s time to celebrate in style. See
the first Academy Awards were held and
lasted only five minutes. We woke up in a
“If you’re and be seen at the uber-cool rooftop bar,
the Standard Downtown, where celebrity
On Oscar Night, you might want to try something other than getting into the Kodak Theatre. room overlooking the Grauman’s Chinese
Theatre, and the hand and footprints of
going to get photographer Barry Holmes once wit-
nessed Tom Hanks encourage everyone to
Charlie Chaplin to Will Smith.
Walk to North Cahuenga Boulevard
in trouble, do sing happy birthday to his wife.
If you’re still not satisfied, follow Harry
MORE QUALITY INCLUSIONS THAN ANY
OTHER RESORTS ON THE PLANET
and eat brunch at Kitchen 24, a retro,
pink-fringed diner open 24 hours that is
it at the Cohn’s advice: “If you’re going to get in
trouble, do it at the Chateau Marmont”.
popular with Oscar favourite Natalie
Portman. We ate a Wakey Wakey Eggs and
Chateau The place is famous for its rock and roll
behaviour, from Led Zeppelin driving

SAVE 30%
*
Bakey, complete with eggs, bacon, and
Marmont” through the lobby on motorcycles to John
UP TO

scrumptious pancakes. Stroll along Belushi dying of a drug overdose. When

*
Hollywood Boulevard and if you’re lucky
PLUS UP
TO AN EXTRA £300 PER COUPLE
you may stumble across a Walk of Fame
ceremony. We watched as Adam Sandler
received an iconic star. Then put your
shades on, go to Griffith Park, and view
the famous Hollywood sign and skyscrap-
ers. It’s perfect for taking your partner:
Katy Perry and Russell Brand went on a
hiking date here last year.
Work up an appetite and visit the Four
Seasons. All rooms have balconies over-
looking the spectacular skyline, and a
complimentary limousine service to
make you feel like an A-lister. We ate our
we were at Bar Marmont no TVs were
thrown out the windows – instead it was
full of fashionistas and twenty-some-
things.
End your evening at the W Hollywood
Hotel. We were in a room apt for an after-
show party rather than snoozing with
disco ball-like lighting, white leather
seats, a shower room big enough for two,
and an Intimacy Kit with contraception.
And with the hotel’s service giving you
whatever you want, whenever, from a
chocolate bath to a helicopter ride of
Hollywood, you can take centre stage.

HURRY! SALE MUST

END 28 FEBRUARY OUT OF OFFICE: HALF TERM
Sandals Royal Caribbean Resort & Private Island, Jamaica
Half term kicks off today, and if
you’re stuck for ways to enter-
WINTER PRICE FREEZE. TRAVEL AT 2010 PRICES!^ tain the kids this week, City A.M.
has a few suggestions.
SAINT LUCIA SAINT LUCIA BAHAMAS
MUSEUM OF LONDON
Family events at the Barbican-
situated museum include the
story of Edmund Haley discover-
ing the comet named after him, a
Sandals Halcyon Beach Sandals La Toc Sandals Royal Bahamian
look at prehistoric stone tools
7 nights Luxury Included® 7 nights Luxury Included® 7 nights Luxury Included®
discovered in London, and experi-
25 April - 28 June 2011 25 April - 28 June 2011 25 April - 28 June 2011 ments with wind and sails for
WAS £1873 NOW fr. £1399 WAS £2016 NOW fr. £1499 WAS £2103 NOW fr. £1659 five-and-unders. You can also
SAVE £474 p.p. SAVE £517 p.p. SAVE £444 p.p. learn the science behind making
the perfect paper planes. For children and their parents comes variety of colourful materials.
ANTIGUA JAMAICA JAMAICA more information go to to the Southbank Centre’s Queen Sessions free. Visit
www.musuemoflondon.org.uk Elizabeth Hall on Thursday and www.npg.org.uk for more details.
will be staying until Sunday, with
CLIMB THE MONUMENT a giddy whirl of instruments and ANTHONY BROWNE
If you want to wow the kids and songs to get the family party The Children’s Laureate (no rela-
tire them out, send them up the started. Shows at 11am and 2pm tion of the City A.M. columnist of
Sandals Grande Antigua Sandals Grande Riviera Sandals Whitehouse
City’s most famous landmark. daily, 24-27 Feb, Queen Elizabeth the same name) and creator of
7 nights Luxury Included® 7 nights Luxury Included® 7 nights Luxury Included® Climb 311 steps, learn some Hall. Tickets £12 from characters like Gorilla, Silly Billy
01 Sept - 30 Nov 2011 25 April - 28 June 2011 25 April - 28 June 2011 London history and look out at www.southbankcentre.co.uk and Willy the Wimp, will be
WAS £1951 NOW fr. £1495 WAS £1532 NOW fr. £1199 WAS £1902 NOW fr. £1489 the stunning views from the top. drawing his characters live and
SAVE £456 p.p. SAVE £333 p.p. SAVE £413 p.p. Tickets are just £1 for children NATIONAL PORTRAIT GALLERY showing how he creates his sto-
and £3 for adults. Kids of an artistic bent can enjoy ries at this live Southbank Centre
Visit www.sandals.co.uk, call 0800 742 742 or see your local travel agent www.themonument.info the free “tour and draw” sessions event on Wednesday afternoon.
at the NPG, led by artists and 2.30pm, 23 Feb, Purcell Room,
*Book by 28 February 2011 for travel up to 26 December 2011. Discount varies depending on room type booked; 25% plus £100 per
couple for all entry level rooms, 30% plus £200 per couple for all Concierge level rooms and 30% plus £300 per couple for all Butler DAN ZANES AND FRIENDS storytellers, or collage-making Southbank Centre.
Service suites. Minimum stay 7 nights. Discount is off accommodation portion only. Terms & conditions and blackout dates apply. Prices The Brooklyn-based singer, song- sessions using characters from Tickets: £8 adults, £4 children,
DUHSHUSHUVRQDQGDUHEDVHGRQWZRSHRSOHVKDULQJDGHOX[HURRPIRUQLJKWVLQFOXGLQJÀLJKWVZLWK%ULWLVK$LUZD\VRU9LUJLQ$WODQWLFDOO
meals, premium drinks, all land & water sports, transfers, tips & taxes. Prices are subject to availability & change without notice. Blackout writer and entertainer loved by the museum collections and a from ww.southbankcentre.co.uk
GDWHVDQGWHUPV FRQGLWLRQVDSSO\A%DVHGRQOHDGLQURRPFDWHJRU\ ÀLJKWFODVV$%7$ $72/SURWHFWHG
CITYA.M. 21 FEBRUARY 2011 Lifestyle | TV& Games 25

BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5 TV PICK

TERRESTRIAL
6pm BBC News 6pm Eggheads: Quiz show, 6pm London Tonight 6pm The Simpsons 6pm Home and Away
6.30pm BBC London News hosted by Dermot Murnaghan. 6.30pm ITV News 6.30pm Hollyoaks 6.25pm OK! TV
7pm The One Show 6.30pm CHOICE 7pm Emmerdale 7pm Channel 4 News 7pm Five News at 7
7.30pm Inside Out: BBC News My Life in Books 7.30pm Coronation Street 7.55pm 4thought.tv 7.30pm How Do They Do It?
8pm EastEnders 7pm Escape to the Country: 8pm The Lakes 8pm Dispatches: The Truth Five News Update
8.30pm How to Blow a A couple look for property in 8.30pm Coronation Street About Hospital Food: A report 8pm The Gadget Show:
Fortune: Panorama Buckinghamshire. 9pm CHOICE The Biggest Loser on the quality of NHS meals. Five News at 9
9pm Outcasts 8pm University Challenge 10pm ITV News at Ten 9pm One Born Every Minute 9pm Royal Navy
10pm BBC News 8.30pm Raymond Blanc’s 10.30pm London News 10pm CHOICE Caribbean Patrol
10.25pm Regional News Kitchen Secrets 10.35pm New Homes Alan Carr: Chatty Man 10pm FILM The Exorcism of
10.35pm Mrs Brown’s Boys 9pm When Teenage from Hell 2009 11.05pm FILM Emily Rose: Horror, starring MY LIFE IN BOOKS
11.05pm Late Kick Off Meets Old Age 11.35pm That Sunday Shine a Light. 2008 Tom Wilkinson and BBC2, 6.30PM
11.35pm The Graham Norton Show 10pm Episodes 1.15am Music on 4: Countdown to New series. Anne Robinson welcomes
12.20am The Apprentice USA
Night Show
the NME Awards 2011 1.30am Laura Linney. 2005.
10.30pm Newsnight: Weather 12.05am Grimefighters 12.25am Forensic Files two celebrity guests to discuss their
1.05am The Apprentice USA; Music on 4: Countdown to the NME
Weatherview 1.55am Sign Zone:
11.20pm ICC Cricket World 12.30am The Zone; Awards 2011 1.55am FILM 12.55am SuperCasino favourite books in the run up to World
Ancient Worlds 2.55am Cup Highlights ITV News Headlines Zatoichi: Japanese revenge 4.05am Divine Designs 4.30am Book Night.
Supermarkets – Are We Being 12.20am An Island Parish 2.30am UEFA Champions League thriller. 2003. 3.50am FILM The Great Scientists 4.55am Animal
Served? 3.55am Save My Holiday 12.50am BBC News Weekly 3am The Jeremy Kyle Show Spanish Gardener. 1956. 5.25am- Rescue Squad 5.10am Wildlife SOS
4.40am-6am BBC News 4am-6am BBC Learning Zone 3.55am-5.30am ITV Nightscreen 6.15am Brothers & Sisters 5.35am-6am House Doctor

SKY SPORTS 1 BRITISH EUROSPORT BBC THREE HISTORY DISCOVERY HOME &
SATELLITE & CABLE

6.30pm The Sky Sports Years
7.30pm Live Irish Football.
Crusaders v Glentoran (Kick-off
7.45pm). 10pm The Sky Sports
Years 11pm Netbusters
11.30pm SPL Round-Up 12am
Soccer AM: The Best Bits 1am
Football League 2.30am
Sports Unlimited 3.30am
Watersports World 4.30am
Max Power 5.30am-6am FIFA
Futbol Mundial
SKY SPORTS 2
7pm Bass Fishing 8pm ICC
Cricket World Cup 10pm
Tennis 12am Boots ’n’ All 1am
ICC Cricket World Cup 3am
European Tour Golf 4am-5am
PGA Tour Golf
SKY SPORTS 3
7pm WWE: Smackdown 9pm
WWE Wrestling 12am WWE:
NXT 1am WWE Vintage
Collection 2am-4.15am Live
WWE: Late Night – Raw
7pm Champions Club 8.15pm
Eurogoals. European football
action. 8.45pm Bobsleigh
10.45pm Champions Club
12am Eurogoals 12.30am-
12.50am WATTS
ESPN
6.30pm Talk of the Terrace
7.30pm Live FA Cup Football
10.30pm Between The Lines
11pm Pardon the Interruption
UK 11.30pm ESPN Game of
the Week 12am Basketball
4am ESPN Press Pass 4.30am
ESPN Game of the Week 5am-
6am Talk of the Terrace
SKY LIVING
7pm Ghost Whisperer 8pm
Nikita 9pm America’s Next Top
Model 10pm Bedlam 11pm
Criminal Minds 12am CSI:
Crime Scene Investigation
2.40am Charmed 4.20am
Four Weddings US 5.10am-
6am Maury
7pm Doctor Who 7.50pm
Doctor Who Confidential 8pm
Hotter Than My Daughter
8.30pm The Lock Up 9pm
Women, Weddings, War and
Me 10pm EastEnders 10.30pm
Being Human 11.30pm Family
Guy 12.15am The Lock Up
12.45am Hotter Than My
Daughter 1.15am The Big Fat
Truth About Low Fat Foods
2.15am Women, Weddings,
War and Me 3.15am How
Drugs Work 4.15am Doctor
Who Confidential 4.25am-
5.25am Being Human
E4
7pm Hollyoaks 7.30pm Friends
9pm Glee 10pm Tool Academy
11.05pm Skins 12.10am
Scrubs 1.05am Samantha
Who? 1.50am Skins 2.45am
Reaper 3.25am The OC
4.10am Running in Heels
4.55am-6am Switched
7pm Heir Hunters. The search HEALTH
for relatives of a deceased 7pm A Baby Story 8pm How
bachelor. 8pm The Search for Clean Is Your House? 9pm
Burke and Hare. The story Trauma Unit 10pm Untold
behind John Landis’s film. 9pm
Stories of the ER 11pm Critical THE BIGGEST LOSER
Pawn Stars 10pm American Condition 12am Trauma Unit ITV1, 9PM
Pickers 12am Pawn Stars 1am 1am Untold Stories of the ER
American Pickers 3am
The contestants head to Cyprus with
2am Critical Condition 3am trainer Richard Callender, where they
Mysteryquest 4am Decoding
How Clean Is Your House? face their latest challenge. Davina
the Past 5am-6am Ancient
4am Bringing Home Baby
McCall presents.
Discoveries 5am-6am A Baby Story
DISCOVERY
SKY1
8pm How Do They Do It? 8pm Road Wars. A driver
8.30pm How It’s Made. The
speeds through the grounds of
manufacture of sails. 9pm a hospital. 9pm Ross Kemp:
Aircrash Confidential 10pm Extreme World 10pm Inside:
Dual Survival 11pm Monsters Teen Lockdown 11pm Mental
Inside Me 12am Bear Grylls: 12am Lie to Me 1am Body
Born Survivor 1am Deadliest Language Secrets 1.50am
Catch 2am Future Weapons Inside: America’s Toughest Jail ALAN CARR: CHATTY MAN
3am The Russian Revolution in 2.40am So You Think You’re CHANNEL 4, 10PM
Colour 3.50am The First World Safe? 3.30am Threshold The comedian is joined by stars of the
War 4.40am Treasure Quest 4.20am Don’t Forget the Lyrics ITV2 reality show The Only Way Is
5.30am-6am How Does That 5.10am-6am Sell Me the Essex, as well as actor Tom Hardy and
Work? Answer singer Ellie Goulding. Last in the series.

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

QUICK CROSSWORD
    

SUDOKU KAKURO
14 31 12 10 28 24 12  
13 11 17
5 
16 10
Place the numbers from 1 to 9 in each empty cell so that each 19
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 12 34
28 3
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 7 17   
above or to the left of it. 34 29 30
You can only use the digits 1-9 26 12
    and you must not use the 18 23    
same digit twice in a block. 7 17
  The same digit may occur 11 24
29
   more than once in a row or
column, but it must be in a 20 13
20
4
8
  
33 6
    separate block.
10 9 
22 15
   6 16 11
 

    ACROSS DOWN
1 Quick and 1 Gives one’s support
  
  WORDWHEEL E I
energetic (5)
4 Brittle fragment (5)
7 Fuse (4)
or approval to (5)
2 Hindu religious teacher (5)
3 Family (3)
Using only the letters in the Wordwheel, you have
    ten minutes to find as many words as possible,
A P 9 Saying: “___ is next 4 Travel on the piste (3)
to godliness” (11) 5 Plant also known as
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters E 10 Metallic element, the windflower (7)

LAST ISSUE’S or more, all must contain the central letter and
letters can only be used once in every word. There
R O symbol Na (6)
12 Small gentle horse (4)
6 Lit by twilight (5)
8 Causing a concluding
SOLUTIONS KAKURO is at least one nine-letter word in the wheel.
V T 13 Number indicated action (9)
by the Roman V (4) 11 Leonardo ___, Italian
QUICK CROSSWORD 6 8 9 5 8 9 7 6 14 Job (6) artist, engineer,
S O F I A E G Y P T
3 6 1 8 4 9 7 5 2 SUDOKU          17 Action of keeping scientist and architect
1 2 5 1 2 6 1 (1452-1519) (2,5)
P E L E E          something harmful
2 4 9 2
R T E L L I N G L Y
5 1 3 7 6 8
         under control or 13 Aspect (5)
A Z A L E A U V
         within limits (11)
W S N U F F I 3 9 8 7 2 8 1 3 15 Dance of Cuban origin (5)
        
L A M E
M
N
W E D
L
G E
I S P
R
1 7 6
8
9
3
9 4
5 2
WORDWHEEL         
20 Crust-like surface of
a healing wound (4)
16 Local tax on property (5)
P H E N C A S E
1 4 1 3 2 9 3          18 Enquire (3)
C E L E B R A T E F The nine-letter word was 21 Believe (5)
R R R R E 2 8 5 3 9 4 6 7 1          19 Word indicating a
4 9 8 6 7 9 8 7
GLACIATED          22 Gapes (5)
L E V E R L A Y E R negative answer (3)
 Sport
26 CITYA.M. 21 FEBRUARY 2011

FOOTBALL ROUND-UP

Der Hammer finally

set for Irons debut
Tehoue hits Tehoue scored the goal
that earned his side a
trip to Las Vegas

the Las Vegas

Pic: ACTION IMAGES

GERMAN midfielder Thomas

Hitzlsperger will finally make his

jackpot for O’s

West Ham debut against Burnley in
the FA Cup tonight.
The former Aston Villa star joined
in the summer from Lazio but has
missed the entire season with a thigh
injury.
Away from the FA Cup, West Ham
received a boost in their fight for Late strike earns Orient an FA Cup
Premier League survival as relegation
rivals West Brom and Wolves drew in replay and a trip to casino capital
the Black Country derby.
A Wolves win would have seen
West Ham go bottom of the table but
Carlos Vela scored in injury time for
West Brom to level the game at 1-1.
LEYTON ORIENT 1
Vieira at the double ARSENAL 1
as City ease through
▲

FOOTBALL
BY JAMES GOLDMAN

FOUR-TIME FA Cup winner Patrick LEYTON ORIENT manager

Vieira scored twice as Manchester
City beat Notts County 5-0 in the FA
Cup fourth-round replay at Eastlands.
Vieira headed a brace before three
late goals gave the scoreline a one-
sided appearance.
The introduction of City captain
Carlos Tevez saw the hosts take con-
trol of the game – he scored a fine
solo goal before crossing for Edin
Dzeko to make it four.
Micah Richards smashed home the
final goal in added time and City will
now face Aston Villa at Eastlands in
Russell Slade revealed his side’s
dressing room was rocking to
the dulcet tones of Elvis Presley
after Jonathan Tehoue’s late
strike earned the League One
side a money-spinning FA Cup
replay at Arsenal as well as a
summer holiday to Las Vegas.
Orient’s chairman Barry
Hearn had promised his side an
all expenses paid trip should
they manage to hold their illus-
trious opponents to a draw.
Tomas Rosicky’s 53rd minute
header – his first goal in 43 match-
es – put Arsenal ahead, but substi-
tute Tehoue’s dramatic late
intervention earned the O’s a
deserved second bite at the cherry.
“The lads had Elvis Presley play-
ing in the dressing room when the
chairman walked in,” said Slade.
“They were playing ‘Viva Las
Vegas’. If we could go at the end of
May or the beginning of June then
that would be lovely. We are hum-
ble, but we are proud that we have
come this far. We can pass the
ball, and today our commitment
was there to see.
“It’s OK saying go and enjoy it,
but you will only enjoy it if you get
some kind of performance.”
Arsenal made 10 changes to the
side which beat Barcelona in mid-
week with 18-year-old Spaniard
Ignasi Miquel making his debut in
the heart of the defence. Despite
not creating the opportunities
their dominance of possession
merited, Arsenal looked set to
clinch victory until Tehoue wrig-
gled free of two challenges and
smashed his shot through Manuel
Almunia’s legs.
Arsenal manager Arsene Wenger
said: “The most negative side of
our result today is one more fix-
ture and in fairness that is not
what we needed. It is a disappoint-
ment, but we are still in the com-
petition and now play at home.”

@
the fifth round.

Where horses
and hearts race
Prior’s glad he’s back to
where he once belonged
@
ing suited my game better, but hav-
Sri Lanka get off
▲

CRICKET
March ing looked at it over here and this
2011 BY JAMES GOLDMAN role I’m going to play in the middle

THE ENGLAND wicketkeeper Matt Prior

admits he’s relieved that his ordeal
FESTIVA
at the top of the batting order has
come to an end.
overs, I think the way the last cou-
ple of games have gone, I’ve found to winning start
a tempo I’m very comfortable with.
“I don’t think as an opener I

Tuesday
1
L After being recalled to the side
following a two-year absence, Prior
was reinstalled as
managed to get that tempo ever,
which was hugely frustrating for
me, because I know that if I get that
MAHELA JAYAWARDENE’S cen-
tury inspired co-hosts Sri Lanka
Wednes 5th an opener at the tempo right, I can be very, very suc- to a 210-run win over Canada in
day 16th expense of cessful. their opening game of the
Thursda

@
Jonathan Davies “Right now, that role is suiting World Cup.
y 17
Friday 1 th for the one-day me and I feel very comfortable The Lions batted first and hit
8 th series in Australia. in it. I feel I can have, fingers 332-7 off their 50 overs with
Prior (right) crossed, some good suc- Jayawardene and captain Kumar
failed to fire, how- cess.” Sangakkara sharing a 179-run
ever, forcing Meanwhile, Graeme third-wicket stand.
England into Swann joined up In reply only Rizwan Cheema
taking a late gamble with the England put up any resistance with a
ahead of tomorrow’s squad last night. quick fire 37 as Canada were
BOOK NOW. TICKETS FROM £22 World Cup opener Swann was bowled out for 122.
against the Netherlands given an extend- In the other Group A game
in Nagpur. ed break due to Hamish Bennett took 4-16 as
0844 579 3003 (24hr) Kevin Pietersen has been
promoted and will now part-
the birth of his
first child last
New Zealand thrashed Kenya by
10 wickets. Tim Southee and
www.cheltenham.co.uk ner Andrew Strauss, while
Prior has been demoted to
week and
expected to play in
is Jacob Oram claimed three wick-
ets each as the African side were
No6, a role he thrives in for Nagpur, having recov- bowled out for 69 in 23.5 overs
the Test side. ered from knee after choosing to bat.
MORE NEWS “The thing I’m excited and back New Zealand needed only
about is the mentality going injuries which eight overs to knock off the
ONLINE into it and the way I’ve been hampered him runs, with Martin Guptill scor-
www.cityam.com asked to play,” Prior said. at the end of the ing an unbeaten 39.
“I’ve always thought open- Australian tour.
CITYA.M. 21 FEBRUARY 2011
FIXTURE PILE-UP | GUNNERS’ BACKLOG
DESPITE having to suffer the inconvenience
of a replay against lower league opposition,
Arsenal’s four-pronged trophy assault is still
alive. The Gunners will, however, face a defin-
ing fortnight in which they will play five
games in four different competitions.
ARSENAL’S HECTIC FORTNIGHT
Feb 23: Stoke (h) Premier League
Feb 27: Birmingham (n) Carling Cup Final
Mar 02: Leyton Orient (h) FA Cup
Mar 05: Sunderland (h) Premier League
Mar 08: Barcelona (a) Champions League
Arsenal or Orient
next for United
MANCHESTER UNITED will face
either Arsenal or Leyton Orient
at Old Trafford in the quarter
finals of the FA Cup after the
draw was made yesterday.
Elsewhere, either Manchester
City or Aston Villa will face the
winners of the fifth round tie
between Everton and Reading,
while Stoke will face the victors
of tonight’s clash between West
Ham and Burnley.
Carling Cup finalists
Birmingham, meanwhile, have
been handed a home tie against
Fulham’s conquerors Bolton.
Crown prince to
make decision
on Bahrain GP
▲
FORMULA ONE
BY JAMES GOLDMAN
FORMULA ONE supremo Bernie
Ecclestone will leave the decision on
whether to hold next month’s
Bahrain Grand Prix to the country’s
crown prince.
The first race of the new season is
in jeopardy as a result of the unrest
that has seen six people killed after
police fired live rounds at protestors
demanding reform. Ecclestone
revealed that crown prince Salman
bin Hamad al-Khalifah was best
placed to make the call.
“He will decide whether it’s safe
for us to be there,” Ecclestone said.
“I’ve no idea. I’m not there, so I don’t
know. We won’t advise people to go
unless it’s safe.”
A final decision could be made as
early as tomorrow and Ecclestone
suggested Bahrain could be moved to
another date later in the season if the
race on 13 March was called off.
The 80-year-old also ruled out hold-
ing the race on that date in another
country, saying there would not be
time for alternative organisers to
make the necessary arrangements
The British Foreign Office –
along with counterparts in many
other major Western countries – is
advising against non-essential trav-
el to Bahrain.
Hughes: Ref
bottled the
big decisions
FULHAM
BOLTON
▲
FOOTBALL
BY JAMES ANDREW
FULHAM boss Mark Hughes
slammed referee Stuart Attwell
as his side were sent crashing out
of The FA Cup at the hands of
Bolton.
Croatian striker Ivan Klasnic
(right) put the pressures of a
police investigation behind him
to score the only goal of the
game, a smartly taken volley
after 19 minutes, at Craven
Cottage to set up a quarter-final
tie at Birmingham.
Police in Manchester have con-
firmed that Klasnic will not face
charges over the alleged rape of a
teenage girl, following an investi-
gation dating back to October.
But in a fiery game Cottagers
manager Hughes was unhappy
with Attwell and accused him of
ducking some major decisions.
The Fulham fans vented their
fury with Attwell after he failed
to punish a string of nasty fouls
from the visitors, in particular
Martin Petrov, who escaped with
just a yellow card after appearing
to elbow Chris Baird in the face.
Hughes said: “There were a
couple of situations where you
SPORT | IN BRIEF
Saracens thrash hapless Leeds
RUGBY UNION: Saracens kept up
the pressure on Premiership pace
setters Leicester with a 39-0 win
over bottom side Leeds. Michael
Tagicakibau crossed in second
minute for the hosts, Alex Goode
kicking the extras, the first of his
14 points. Brad Barritt and James
Short also went over before half-
time, with Richard Wigglesworth
sealing Sarries a bonus point just
after the break. Chris Wyles then
touched down late on.
Results
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email sport@cityam.com
27
Ancelotti hopes he’ll be
at Chelsea for long haul
CHELSEA manager Carlo Ancelotti was strongly linked to the manageri-
maintains he won’t be falling on his al job at Stamford Bridge yesterday –
sword at Stamford Bridge and but the Italian (inset) insists all is
claimed Roman Abramovich must not lost this season.
decide whether or not he should be Asked if he would ever consid-
sacked. er resigning, the Italian
With hopes of retaining said: “No, not me. I
think the referee needs to make a their Premier League don’t have to consider
0 positive decision and just waving
your arms for an advantage can
crown gone, Chelsea, FA
Cup winners in each of
my position. It is the
owner that has to
be a cop-out. the last two seasons, consider my posi-
1 “In and around the box you
don’t particularly want advan-
crashed out of the com-
petition at Stamford
tion, not myself.”
Meanwhile,
tage. You want free-kicks and set-
plays, which we didn’t seem to
Bridge after Everton pre-
vailed in a penalty
Roma, who have
been linked with an
get. In the second-half, there
were a few decisions we found
difficult to understand.”
shootout on Saturday.
After a poor run of
domestic form since the big-
audacious move to
bring their former
player, Ancelotti, back to
There was one positive for money arrivals of Fernando Torres Serie A, last night accepted the resig-
Hughes and Fulham in the and David Luiz, Ancelotti’s position nation of former Chelsea boss
return of striker Bobby Zamora is the subject of speculation once Claudio Ranieri following a 4-3
from a broken leg. again – Fulham boss Mark Hughes defeat at Genoa.
The England star has been out
of action since September follow-
ing a challenge from Wolves mid-
fielder Karl Henry, but made his
comeback for the last 24 minutes
of the game.
Hughes was pleased to see him
back in action and now has a
selection issues up front with
Zamora, Andy Johnson,
Mousa Dembele and
Eidur Gudjohnsen
all vying for a start-
ing place.
Hughes added: “If we take the
positives, the appearance of
Bobby Zamora was huge for us
and everybody saw what talent
he has and what we
have missed this
year.
“He has been
training for a long time. It was a
case of getting him out there and
making him a part of it – hope-
fully it will bring him on.”
Soderling wins in Marseille Higgins defends Welsh title
TENNIS: Robin Soderling came SNOOKER: John Higgins beat
from a set down to clinch the ATP Stephen Maguire 9-6 to secure
Open 13 title in Marseille with a 6- back-to-back Welsh Open titles.
7, 6-3, 6-3 win over Marin Cilic. Maguire dominated early on but
Having dropped the first set, the only managed to open up a 5-3
world No4, Soderling, settled into lead. Maguire had plenty more
his rhythm and broke the Croatian chances in the evening session,
twice to seal the second set. A but the world No1 was ruthless
fine backhand down the line fol- as he won five frames in succes-
lowed by an unforced Cilic error sion. Maguire stopped the rot
saw him break in the third to set with a 75 but his fellow-Scot
up his 17th win from the 18 fired in a 54, 66 and 72 to secure
matches he has played in 2011. his third crown in Wales.
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 Central Banks dump a) Nip down the pawnbrokers
with Dad’s old sovereign ring.
their Gold reserves.
b) Remember what happened
Do you: after Gordon Brown sold
ours and buy.

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