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n NIKKEI FALLS SIX PER CENT IN FIRST HOUR OF TRADING n THIRD NUCLEAR REACTOR EXPLODES
BY MARION DAKERS
JAPAN fought to keep control of its
damaged nuclear power plants yes-
terday, as explosions at two more of
the Fukushima plant reactors fuelled
fears of a partial meltdown from
failed cooling systems and ham-
mered the markets this morning.
Japan’s Nikkei 225 index fell six
per cent in the first hour of trading
this morning, after suffering the
fastest decline since October 2008
yesterday. Utility, transport and
manufacturing stocks were hit hard Fukushima’s reactor 3
again as the country’s weakened threw off black smoke
infrastructure hampered the ongo- after an explosion at
ing rescue efforts. 11am yesterday
World stocks slid to six-week lows
yesterday as traders reacted to the
unfolding disaster.
Officials reported an explosion at
Fukushima’s reactor 2 early this
morning, where yesterday workers
had raced to prevent meltdown
“The nuclear plants
when the improvised seawater cool-
ing system failed leaving nuclear
have been shaken,
rods temporarily exposed.
Non-essential workers were evac-
flooded and cut off
uated from Fukushima early this
morning after fears of a radiation
from electricity”
leak. Yukiya Amano,
Plant operator Tokyo Electric International Atomic
Power Company (TEPCO) said the Energy Agency
rods in Fukushima’s reactor 2 were
half-covered with water at 9am
local time (midnight GMT), and that
levels continued to improve in all being continued.” sent flames and black smoke into Across the country, officials said without water. “The Japanese gov-
the units. Chief cabinet secretary Yukio the air at 11am local time yesterday. at least 10,000 people have died ernment is currently taking the nec-
“There is the possibility that dam- Edano said earlier yesterday some Radiation levels at the plants, since the earthquake and subse- essary precautions – evacuating
age was done to the suppression damage has been detected at reac- located 240 km (150 miles) north of quent tsunami on Friday. nearby communities, putting peo-
pool,” said a spokesperson during a tor 2, though no data was available Tokyo, climbed from 1,941 to 8,217 About 450,000 people have been ple in safe shelters and distributing
news conference, referring to the this morning. microsieverts an hour at 9am local evacuated nationwide in addition potassium iodide to those at risk,”
store of water under the reactor A separate blow-out at time, TEPCO said – well above the to 80,000 from the exclusion zone the World Health Organisation said.
meant to prevent meltdown. “The Fukushima’s reactor 3, thought to legal limit of 500 microsieverts an around the nuclear power plants, FOCUS ON JAPAN: P2, P3, P4,
water injection operations are be caused by a hydrogen build-up, hour. and almost 2m households remain MARKETS: P15; P18
FTSE 100 ▼ 5,775.24 -53.43 DOW ▼ 11,993.16 -51.24 NASDAQ ▼ 2,700.97 -14.64 £/$ ▲ 1.62 +0.01 £/¤ 1.16 unc ¤/$ ▲ 1.40 +0.01 Certified Distribution
31/01/11 - 27/02/11 is 107,265
2 News CITYA.M. 15 MARCH 2011
cost of a truly
horrific tragedy
wealth. That would be to fall foul of
what Frederic Bastiat called the bro-
ken window fallacy: a country doesn’t
become richer when its assets are
smashed up, even if mending them
temporarily creates new jobs. The third nuclear
Earthquakes don’t boost a nation’s reactor of the
wealth, they make it poorer; Fukushima
EDITOR’S LETTER resources that could have been allo- Daiichi nuclear
cated to other things need to be plant is seen
ALLISTER HEATH diverted to the rebuilding effort. Vast burning after an
explosion in this
amounts of Japan’s capital have been
SLOWLY but surely, more horror sto- destroyed, including several nuclear satellite image
ries are emerging from the rubble power stations worth at least $5bn taken 14 March
that is Tsunami-hit Northern Japan. each, as well as tens of billions worth Opposite: A tech-
The death toll will undoubtedly be of housing and commercial property. nician in protec-
many orders of magnitude higher One need not agree with the more tive gear scans a
child for signs of
than the few thousand so far con- extreme estimates of the value of the
radiation
firmed by the authorities, while the destruction – one analyst puts the Pictures:
big issue last night was the extremely destroyed capital at $1 trillion – to see REUTERS, GETTY
serious problem at several Japanese that replacing what is broken is dif-
nuclear power plants. While this ferent to adding to the stock of
series of accidents still appears to be wealth. So much for the economics –
inevitably bounce back from severe the crisis were hugely complex and INSURANCE by Japan’s government-backed earth- ket, gained 2.2 per cent and 2.3 per
natural disasters; after a sharp slump included central banks’ low interest BY ALISON LOCK quake insurance programme, interna- cent. Jefferies analyst James Shuck
in GDP, output inevitably shoots back rates, government guarantees, intel- tional insurers cover all commercial said Amlin’s strong retrocession cover
up again as reconstruction efforts lectual errors about statistical pat- JAPAN’S tsunami damage may cost property, industry and marine claims. should cap its liability at about $150-
begin. It will be no different this time, terns and numerous other policies. insurers more than $60bn (£37bn), and Goldman Sachs analysts said Swiss 160m. Chaucer said it had little expo-
despite Japan’s excessive public debt Yet another point is even more fun- lead to premiums rising for the first Re would bear SwFr 1.9bn (£1.3bn) sure to Japan’s nuclear industry.
and unfavourable commodity prices. damental: most people on high time in years, analysts said yesterday. losses if it categorised the catastrophe But Shuck added that with a 70 per
But one should not confuse a rise incomes don’t actually work in Reinsurers such as Swiss Re and as a one-in-200-year event. Rival SCOR cent chance of large aftershocks, loss-
in GDP as repair work kicks in in a finance. Jo Johnson, the Tory MP for Munich Re are likely to consider this a has said it will bear about €185m – es were likely to rise yet further.
few months’ time with a rise in Orpington, was keen to find out who “one-in-200-year” event, which would slightly less than the €260m analysts
actually paid the tax; the Treasury’s mean they face losses of up to €2bn expected it would bear from a one in ANALYSIS l Swiss Re
permanent secretary Sir Nicholas (£1.7bn) each. 250-year event. 60 SwFr 49.36
Macpherson has obliged. Of the The losses are likely to count as a Standard & Poor’s analysts said 59 14 Mar
275,000 paying the new 50p tax “market-changing event” that would Munich Re may also be exposed to 58
(which will reach 52 per cent in April end the trend of falling insurance pre- €2bn if it was characterised as a one- 57
with extra employee national insur- mium rates, Panmure Gordon analyst in- 200-year event. They forecast a pre- 56
7th Floor, Centurion House, ance) only 63,000 work in financial tax cost to the firm of €500bn-800bn. 55
Barrie Cornes said. “In our view, the
24 Monument Street, London, EC3R 8AJ intermediation, such as banks and loss will be so large that it will proba- Swiss Re closed 4.5 per cent down
54
Tel: 020 7015 1200 Fax: 020 7283 5334 53
funds. I would guess a few thousand bly provide the trigger to ensure a re- and Munich Re 3.4 per cent lower. In 52
Email: news@cityam.com www.cityam.com others on similar incomes yet not in rating of the non-life sector, as London, Lloyd’s insurers Catlin and 51
Editorial this list could be described as quasi- sufficient capacity [capital] is with- Beazley ended down 3.2 per cent and 50
03 Jan 21 Jan 10 Feb 01 Mar
Editor Allister Heath investment bankers (lawyers specialis- drawn to allow rates to rise,” he said. 2.83 per cent respectively, but Amlin
Deputy Editor David Hellier ing in corporate finance and so on).
News Editor David Crow But the vast majority of those paying
Night Editor
Business Features Editor
Katie Hope
Marc Sidwell
the new tax work in other fields.
The widespread view that the only WHAT THE OTHER PAPERS SAY THIS MORNING
rich people in the UK today are
Lifestyle Editor Zoe Strimpel bankers is absurd. A little more than
Sports Editor Frank Dalleres 2,800 people in firms under the
Art Director Craig Gaymer Financial Services Authority’s remit
Pictures Micha Theiner earned more than £1m in 2009, the UK ART MARKET LOSES OUT TO SHOPPERS GET WISE TO DODGY MCKINSEY SCRAMBLES TO LIMIT
Commercial regulator revealed last year. Even if we CHINESE PRICING INSIDER TRIAL FALLOUT
Sales Director Jeremy Slattery were to assume that this number has Britain has lost its position as the Research for furniture retailer CSL McKinsey has launched a concerted
Commercial Director Harry Owen gone up, and that other quasi-bankers world’s second largest art market to suggests consumers are no longer effort to try to reassure clients and
Head of Distribution Nick Owen (consultants, lawyers, top partners at China, in a sign of intensifying com- fooled by “dodgy pricing policies”. limit the damage to its reputation
professional services firms) ought to petition and a shift in the geographi- The study found that almost all con- from its involvement in one of
Distribution helpline be added in, it is fair to assume that cal distribution of wealth towards sumers think furniture retailers are America’s biggest insider trading
If you have any comments about the distribution no more than 4,000 people in City- Asia, according to a new study. The guilty of misleading pricing. cases.
of City A.M. Please ring 0207 015 1230, or email style jobs make £1m a year. Yet HMRC UK’s share of the global art market
distribution@cityam.com
estimates that around 13,000 people fell by 5 percentage points to 22 per PAYE FIASCO: 10,000 HAVE TAX DEBTS OBR CRITICISED OVER MISLEADING
Editorial Statement in the UK earn £1m (down 1,000 from
its peak).
cent in the four years to 2010. CANCELLED
A quarter of those who appealed
FISCAL FORECASTS
The OBR has come under fire for fail-
This newspaper adheres to the system of
self-regulation overseen by the Press Complaints Most are the entrepreneurs who FULLER’S XIX NOW VALUED AT $100M against last year’s shock tax demands ing to include the projected value of
Commission. The PCC takes complaints about the are meant to grow us out of recession, Simon Fuller, creator of the American from HM Revenue & Customs had asset sales in forecasts for the public
editorial content of publications under the Editor’s non-finance company directors, top Idol television series, has signed finances. Andrew Tyrie, chairman of
Code of Practice, a copy of which can be found at their tax debts cancelled, it has
business people, entertainers and Formula One driver Lewis Hamilton the Treasury Select Committee, said
www.pcc.org.uk emerged. David Gauke, a Treasury
footballers. None are to blame for the in his first deal since launching XIX not including the estimated proceeds
Printed by Newsfax International, crisis – all are being hammered. Entertainment, his new media com- minister, disclosed that 23pc of those from assets such as the student loan
Beam Reach 5 Business Park, who used the “extra-statutory conces-
Marsh Way, Rainham, Essex, RM13 8RS allister.heath@cityam.com pany that has secured investment in portfolio “may give a misleading
Follow me on Twitter: @allisterheath two deals valuing it at $100m. sion” A19 were successful. assessment” of the country’s finances.
CITYA.M. 15 MARCH 2011 News 3
Power
STEAM lines
Control
rods Turbine
WATER
Reactor
Generator
Nuclear
fuel
Pump
Nuclear fears
spark drop in
energy stocks
▲
JAPAN QUAKE consequences of the tragedy to finances... The earthquake may have
BY JULIET SAMUEL become clear. The country’s debt-to- shifted such a potential tipping point
GDP ratio is forecast to exceed 200 per a bit forward.”
THE earthquake and tsunami in Japan cent this year. S&P agreed that there would be no
could bring forwards a crucial “tip- Moody’s said it understood that immediate effect on Japan’s rating but
ping point” for market confidence in Tokyo will have to suspend tackling its said: “The additional costs will add to
its sovereign debt, according to debt in order to provide relief to the the already existing fiscal weaknesses.”
Moody’s Investor Services. millions left homeless by the disaster. Around 90 per cent of Japan’s public
Ratings agencies have so far held off But the agency’s Thomas Byrne said: debt is owned by domestic savers,
reviewing the status of Japan’s debt, “A tipping point may be reached at many of them pension funds, which
which S&P recently downgraded, say- some point if the market loses confi- has so far enabled it to keep interest
ing that it will take time for the fiscal dence in the soundness of government rates low despite its high debt load.
Luxury firms
take a tumble
▲
JAPAN QUAKE
BY MARION DAKERS now seems vulnerable,” said MF
Global.
THE DISASTER in Japan pummeled However, the need for temporary
manufacturing and luxury goods power to aid rescue efforts propelled
stocks yesterday, alongside insurers Aggreko to the top of the FTSE risers.
and energy firms, as markets across Manufacturing stocks fell on wor-
the world ended lower. ries that supply chains will be dis-
Burberry, which says it makes a sig- rupted. Hitachi’s operations at six
nificant portion of its profits from its plants in the country remained sus-
Japanese licenses, fell 4.3 per cent in pended yesterday, pushing its New
London trading yesterday. York- and Tokyo-listed shares down
Hermes, which makes 19 per cent more than 15 per cent.
of its sales in Japan, fell 3.1 per cent Peugeot Citroen said yesterday it
in Paris trading. has halted production of its electric
LVMH, the owner of Moet, cars, which are made in Japan, help-
Hennessy and Louis Vuitton, tum- ing send its shares down 1.9 per cent.
bled 3.1 per cent as the recovery in Toyota fell 4.6 per cent after it said
high-end retail looked under threat. it has suspended all production in
Japan makes up 11 per cent of the Japan until at least Wednesday.
world’s luxury goods sales, ranking Boeing shares fell 1.3 per cent in
second globally behind the US. New York trading after its head of
“As far as the European consumer commercial aeroplanes said the 787
sector is concerned in the wake of Dreamliner faces further delays if its
the earthquake, we believe that the Japanese suppliers are disrupted
early cycle recovery rally in Luxury beyond a few weeks. MARKETS: P15
Renault says
Tchenguiz on sorry over false
attack after spy claims
firm collapses
AUTOMOTIVE
▲
FRENCH carmaker Renault yesterday
made a public apology to three execu-
tives accused of industrial espionage
after the Paris prosecutor said the trio
had no case to answer.
Bank accounts in Switzerland and
▲
WORLD
BY STEVE DINNEEN ernment buildings. Shi’ites make up The government is coming under
about 15 per cent of the population in increasing pressure to decide if it will
SAUDI Arabia sent troops into Bahrain Saudi Arabia, a key US ally and the intervene in the region as Libyan leader
yesterday to help put down weeks of world’s top exporter of oil. Colonel Gaddafi regains control of key
protests by the Shi’ite Muslim majori- Bahrain has been gripped by its strongholds. Gaddafi’s jets bombed
ty, a move opponents of the Sunni rul- worst unrest since the 1990s after pro- Libyan rebels yesterday, aiding a count-
ing family on the island called a testers took to the streets last month, er-offensive that has pushed insurgents
declaration of war. inspired by uprisings that toppled the 100 miles east in a week. Cameron said:
The Saudi capital, Riyadh, said that leaders of Egypt and Tunisia. “There is no intention to get involved in
it had responded to a “security threat” The intervention in Bahrain came as another war. What is being looked at is
by deploying its troops on the streets David Cameron yesterday insisted that how do we tighten the pressure on an
of its neighbour. They are to protect the UK will not be dragged into a war unacceptable, illegitimate regime.”
Anti-Gaddafi rebels are struggling to hold the towns they took earlier Picture: GETTY
Nasdaq moves
in on NYSE bid
attempts to reposition itself amid a
▲
STOCK EXCHANGES
BY MARION DAKES flurry of mergers and takeovers across
the world’s stock exchanges.
NASDAQ stock exchange is poised to NYSE announced its $10bn merger
make a hostile takeover bid for the plan with Deutsche Boerse last month,
New York Stock Exchange (NYSE), after although politicians on both side of
entering late stage talks with Bank of the Atlantic have said the deals could
America Merrill Lynch to fund the face competition hurdles.
attempted break-up of NYSE and Nasdaq and Bank of America
Deutsche Boerse’s merger. declined to comment, while the NYSE
Nasdaq is close to securing $5bn and Intercontinental Exchange did
(£3.1bn) of financing for its takeover not return calls yesterday.
bid, which could be unveiled as soon Bringing Nasdaq and NYSE together
as today. would create a stock-trading power-
The firm has teamed up with house in the United States and Europe
Intercontinental Exchange, which that also dominates US options and
would snap up NYSE’s European assets listings businesses. It would be a bold
under the break-up plans. move by Nasdaq chief executive Robert
However, talks were said to be ongo- Greifeld, and, if successful, would
ing last night and it was unclear what redraw the global exchange map.
final shape the possible bid would Any bid would follow weeks of spec-
take. ulation that Nasdaq, the odd one out
Nasdaq has been considering amid a merger frenzy, would jump
muscling in on the NYSE-Deutsche into the fray with its own bid for an
Boerse merger for several weeks, as it exchange operator.
HEDGE FUNDS
stringent rules on pay and effective
EUROPE’s largest hedge fund manag- tax rate of 51 per cent on personal
er, Brevan Howard Asset income. Brevan Howard has seen a
Management, will see another of its raft of its staff move to Switzerland
top executives move to Switzerland since opening an office in Geneva in
this year. 2009. Last year, Alan Howard, co-
Australian co-chief executive Nagi founder of the firm, moved there and
Kawkabani said the decision to leave the asset manager has plans to double
London is purely a “lifestyle choice”. its Geneva headcount this year. It has
But the move will inflame fears $32.6bn (£20.1bn) in assets under
that London is becoming a less attrac- management.
CITYA.M. 15 MARCH 2011 News 7
Southern Cross
Qatari wealth shares dive on
fund buys 6pc debt worries
of Iberdrola
HEALTH
▲
SHARES in healthcare group
Southern Cross plunged by up to 60
per cent yesterday as the company
admitted it was struggling in the face
of NHS and council budget cuts.
The company has appointed KPMG
▲
ENERGY which holds a 20.2 per cent stake in to look at restructuring options after
BY ELIZABETH FOURNIER the company. cuts in local authority spending wors-
ACS, run by chief executive Pervez, ened its trading outlook.
SPANISH energy company Iberdrola is suing Iberdrola for seats on its It said yesterday that it was no
will sell a six per cent stake to Qatar’s board, with Perez saying last month longer in talks with potential buyers.
sovereign wealth fund, in a strategic that he was “more committed than Galleon founder Raj Rajaratnam is on trial in the US for insider trading Picture: PA while it also admitted it was in dan-
alliance valued at €2bn (£1.7bn). ever to being its biggest shareholder”. ger of defaulting on debts. The joint
Qatar Holdings, which is part of Qatar Holding bought the Harrod blow sent its stock into a nosedive.
boost its balance sheet and protect its Rajaratnam, who is on trial on crimi- The firm provides care to more
credit rating. BY HARRY BANKS nal charges of running a vast insider than 31,000 people, with the bulk of
The company has been looking to ANALYSIS l Iberdrola SA trading network. funding coming from the NHS and
limit its debt since the acquisition of 6.6
5.98 A DISGRACED former McKinsey & Co “He called me at home and he said, councils. Budget cuts have left the
€ 14 Mar
Brazilian power company Elektro partner has testified that Galleon fund ‘I just wanted to thank you. That was company reeling as it struggles to
Eletricidade e Servicos in January this manager Raj Rajaratnam paid him a fantastic, we are all cheering you at meet rents on its buildings.
6.2
year for €1.8bn. $1m (£617,856) “bonus” for tipping the office right now,’” Kumar testified On potential takeovers Southern
It also pledged €2.5bn last week to him about an acquisition by chip- in Manhattan federal court. “That added: “The board considers that none
buy out minority shareholders in its 5.8 maker Advanced Micro Devices (AMD), made me very nervous.” of these proposals are likely to result in
Iberdrola Renovables arm, which a client of the consulting firm. Prosecutors in the trial are expected a meaningful offer being made in the
focuses on renewable energy. Anil Kumar told jurors yesterday he to name David Palecek, a McKinsey foreseeable future and has decided not
The deal will give Iberdrola a bal- 5.4 supplied confidential details about partner who died last year, as a third to pursue them further.”
last against its largest single investor, AMD’s 2006 purchase of graphics chip- target for Raj Rajaratnam to recruit to Southern’s shares closed 64.6 per
Spanish construction group ACS, 20 Dec 11 Jan 31 Jan 18 Feb 10 Mar maker ATI Technologies to his alleged insider trading ring. cent lower yesterday at 5.57p.
CITYA.M. 15 MARCH 2011 Politics 9
▲
POLITICS Mroueh, a director in Fitch’s
PETER SYMES | DAVID JONES | TOLA ADERINOKUN | BRITAIN’S top-notch credit rating
Sovereign team.
Fitch said the government’s deficit
JLT QBE SONY GLOBAL looks increasingly secure thanks to reduction plan was credible and it
the government’s spending cuts and expected the 23 March budget to reaf-
“No. People who would otherwise “No. If we end up with a bonus “Yes. They earn a lot of money and a recovering banking sector, ratings firm the government’s commitment
we’re in a mess because of them. agency Fitch said yesterday, in a sig- to fiscal tightening.
come to work in banks in the UK, tax on banks it would cascade to nificant boost for the chancellor. The opinion of the ratings agency
paying other everyone else. It would make a However, Fitch said there was a risk will provide a welcome fillip for
taxes, would be Everyone has a difference, that inflationary pressures could George Osborne, who is fighting
spur a sharper-than-expected rise in claims from Labour that he is cutting
driven away to choice in life, if because they interest rates which might hurt the too far and too fast.
work elsewhere. you end up in a get a lot in economy. However, Fitch noted that uncer-
“The strong budgetary consolida- tainty over how much spare capacity
It wouldn’t help bank, why bonuses. It tion effort and declining fiscal risks remained in the economy as well as
the govern- should you be would help to fix arising from the UK financial sector the pace of economic recovery had
support the stable outlook on the increased the potential for monetary
ment.” taxed more?” our finances.” UK’s ‘AAA’ ratings,” said Maria Malas- and fiscal policy errors.
▲
cutting VAT on fuel is illegal under EU POLITICS
BY DAVID CROW Balls said the government should states to have two sep- for domestic fuel. should be directly linked to their per-
also put £1.2bn towards building arate rates of VAT: a However, the EU rarely formance and should be subject to far
LABOUR shadow chancellor Ed Balls 25,000 new homes, which he said headline rate (20 per grants VAT deroga- greater public scrutiny.
yesterday claimed the government would create a further 20,000 jobs – cent in the UK) and a tions – in fact there are Under his proposals public servants
could create 110,000 jobs and build bringing the total to 110,000. reduced rate (five currently just three. will have a percentage of their basic
25,000 new homes by clobbering the A further £200m should be used to per cent in the UK). Cyprus, for example, pay “at risk” each year, with the money
banks with a £2bn tax on bonuses. boost the regional growth fund, he A third rate of VAT has a reduced rate of earned back by meeting performance
Balls, who is seeking to flesh out said. at 17.5 per cent VAT on cylinders of liq- targets.
Labour’s economic policy ahead of the Balls accused chancellor George could be intro- uefied natural gas However, he fell short of recom-
Budget on 23 March, said the tax Osborne of pursuing a “reckless exper- duced on some while certain regions mending a fixed limit on pay multi-
would “boost jobs and growth”. iment to cut too deep and too fast” items under EU law in Portugal pay lower ples, whereby executives could only
He urged the government to spend and said the economy had “taken a – but not fuel. VAT than others. earn 20 times more than their lowest
£600m on a job creation scheme for turn for the worse”. paid workers.
unemployed youths – similar to the However, he remained tight-lipped He also warned against using the
now-defunct future jobs funds – which on which spending reductions Labour
THE VERDICT | Prime Minister’s pay as a benchmark
he said would generate 90,000 jobs. would oppose and how it would fund for the earnings of other senior public
Labour’s future jobs fund was the cost to the cash-strapped excheq- Balls is perfectly right to claim that it John Whiting, the head of the Office servants.
scrapped last year by the coalition uer. would be possible to apply to the EU for Tax Simplification, said it would be Instead he said both the public sec-
after a Department for Work and And he repeated his call for a reduc- for permission to introduce a third “unlikely the EU would grant a dero- tor and listed companies should be
Pensions study showed that 50 per tion in fuel VAT, despite claims that rate of VAT at 17.5 per cent especially gation on something as fundamental required to track and publish their pay
cent of participants were back on ben- such a tax cut would fall foul of for fuel. However, that doesn’t mean as petrol”. Lowering VAT on fuel is multiples to make it easier to compare
efits within seven months of joining European laws. the EU is likely to grant a derogation. not a credible option. earnings of top executives.
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This advertisement is issued in the UK by the London Branch of Société Générale. Société Générale is a French credit institution (bank) authorised by the Autorité de Contrôle Prudentiel (the French Prudential Control Authority). Société Générale is subject to limited
regulation by the Financial Services Authority in the UK. Details of the extent of our regulation by the Financial Services Authority are available from us on request. Investors’ capital is at risk. Investors should not deal in this product unless they understand its nature
and the extent of their exposure to risk. We recommend that retail investors consult their own independent professional advisers. Covered Warrants are issued by Société Générale Acceptance, a member of the SOCIETE GENERALE group of companies. Any failure
of Société Générale Acceptance to perform obligations when due may result in the loss of all or part of an investment.
CITYA.M. 15 MARCH 2011 News 11
▲
BY ELIZABETH FOURNIER good returns on equity while
employing little or no debt, and
BERKSHIRE Hathaway’s purchase “simple businesses”.
of Ohio chemical maker Lubrizol Lubrizol seems to be an exact fit
for $9bn (£5.6bn) is one of the for Buffett’s strict criteria. Its rev-
SUPPORT SERVICES lems with its short-term funding biggest deals ever for Berkshire enue last year hit $5.4bn, when it
▲
BY KASMIRA JEFFORD broke-up talks with a third party. chairman Warren Buffett, who is generated a cash flow of close to
AssetCo is understood to have quickly making good on the prom- $690m.
TOP shareholders in AssetCo, the received a formal bid from a Middle ise of “major acquisitions” that he It’s also a market leader in its
largest fire-engine supplier to the Eastern investor after it turned to made in his annual shareholder sector – claiming the world’s
London Fire Brigade, have criticised its shareholders last month for emer- letter last month. largest market share in the lubri-
board for not considering a takeover gency funding. But the company The price tag for Lubrizol is at a cant additives business, even in
approach more carefully. rejected the approach, calling it premium of 28 per cent to its clos- the face of competition from
The Aim-listed company yesterday “opportunistic”. ing price on Friday, valuing the Exxon and Shell’s Infineum
said it had rebuffed months of bid “Independent directors consider the lubricant additive company at $135 joint venture.
talks and taken out an emergency loan current approach to be opportunistic per share. Lubrizol’s shares gained The company will keep its
of £1.45m as it prepares to raise more and not in the interest of shareholders 27.7 per cent to close at $134.6 yes- Ohio base, and continue to be
cash from its shareholders. as the indicated price range included terday – close to the offer price. managed by current chief
One of the firm’s top investors, how- an offer at a discount to the current Berkshire Hathaway’s annual executive James Hambrick.
ever, told City A.M. that certain institu- market price,” it said in a statement. report for 2010 also detailed the Lubrizol is Buffett’s second
tions would have been in support of a Next Monday AssetCo will ask share- type of acquisition Buffett would biggest acquisition in the last
takeover bid. holders to approve the proposed plac- be seeking, after he declared to five years after Burlington
“The company has a duty of care to ing of new shares to raise £16m, which shareholders that his “trigger fin- Northern, which he paid
its shareholders to consider a bid at a will help repay the short-term loan ger is itchy” to start spending the $26bn for in November
significant premium carefully and we facility from its principle banker. fund’s $38.2bn cash pile. 2009. The deal is expected
can’t understand why it didn’t do it,” AssetCo’s loan announcement reas- The criteria included companies to be completed by the
said the shareholder. The announce- sured investors and sent shares up 24 with at least $75m of pre-tax earn- third-quarter of this year.
ment comes one month after prob- per cent, closing at 19.75p. WARREN BUFFETT
BY KASMIRA JEFFORD last Thursday raised its original Exchange, a rise of 0.3 per cent.
$16-a-share cash offer for Riversdale The acquisition of Riversdale
RIO TINTO, the mining giant, to $16.50, pricing the coal miner would be Rio Tinto’s first major
moved closer in its bid to gain con- and its African operations at takeover since its $38bn acquisi-
trol of rival Riversdale Mining yes- $3.9bn. tion of Alcan in 2007.
terday, after a $3.9bn (£2.4bn) It also extended the offer period A Rio Tinto spokesman declined
improved offer spurred more for a third time to 1 April, to comment yesterday.
shareholders to accept the bid. although the cut off date for the
In a notice to the Australian $16.50 offer is 23 March. ANALYSIS l Rio Tinto
Securities Exchange, Rio said the Rio’s offer, which has been rec- 4,700 p
number of shares it either owned ommended by all of Riversdale’s 3,975.00
or had received acceptances in board, is still waiting for votes from 14 Mar
4,500
respect of the offer had risen from Riversdale’s two largest investors,
17.86 per cent to 26.13 per cent by India’s Tata Steel and Brazil’s CSN, 4,300
Friday night. which hold a combined 47 per cent
A further 8.37 per cent of shares of voting rights. 4,100
has been put into an institutional Riversdale shares closed at
acceptance facility that would turn A$15.45 on Australian Securities 3,900
the shares over to Rio if the bid Exchange, down 0.45 per cent on
passed the 50 per cent threshold. the day, while Rio’s shares closed 20 Dec 11 Jan 31 Jan 18 Feb 10 Mar
CAPITAL MARKETS
▲
INSURANCE
THE TOTAL level of cash raised through initial public EUROPE’s insurers would see their free capital cut by
offerings (IPOs) in Asia so far this year has hit its highest more than a third by new higher solvency require-
level since before the recession. ments imposed from 2013, regulators said yesterday.
Companies from the region have generated a total of Incoming Solvency II regulation would cut firms’
$20.8bn (£12.9bn) from stock market offerings since surplus capital by 44 per cent or a total €86bn (£74bn)
January, according to data provider Dealogic. if implemented without any relaxation of the rules,
The figure comes after a boom year for Asia-Pacific IPOs the European Insurance and Occupational Pensions
– which had at this point last year notched up $18.2bn – Authority found.
and despite market volatility in the Middle East. Where insurers applied their own internal risk
In 2009, only $314m had been raised in Asia-Pacific assessment models, or calculated the value of their
stock offerings by this point in the year. assets using transitional measures, their free capital
The $5.5bn offering by Hong Kong port operator would be cut by just €3bn, or one per cent. But the new
Hutchison Ports Holdings Trust on the Singapore Stock rules do not yet specify when and to what extent regu-
Exchange has driven up the figure, in a strong year to lators would allow companies to use such internal
date for Asian firms. models or transitional arrangements. “QIS5 has shown
Several large flotations of Chinese firms also helped to that Solvency II will be more onerous than the existing
boost the figure. regime,” said PwC partner Philippe Guijarro.
12 News CITYA.M. 15 MARCH 2011
I
F, as seems likely, 3i decides to clients, to which it can now offer equi- corporate broker. be being offered to encourage people fic out of Arden. John Goold, one of
appoint Barclays Capital as its ty advice. As well as the corporate broker- like former Arden chief executive the firm’s original founders, last
joint corporate broker at the end Some say that Renwick will be hard ships, Barclays Capital was also cho- Jeremy Grime and colleague Sarah week returned from Oriel Securities
of the month it will be further pressed to serve the bank’s growing sen as one of three advisers to the LSE Spikes to join RBC. to be its head of institutional sales.
proof that Barclays’s strategy of number of broking clients, which on its bid for Canada’s TMX, along- Together with Peter Lenardos, the david.hellier@cityam.com
UK is set for
Fears of Irish steady but
default grow slow growth
over tax row
▲
WORLD ECONOMY
THE British economy is set for “a slow
but stable pace of expansion,” the
Organisation for Economic Co-opera-
tion and Development (OECD) said
four years to 7.5. yesterday.
▲
EUROZONE CRISIS
The Eurozone pact also agreed to “The OECD indicator is consistent
BY JULIET SAMUEL
move forwards with a “common cor- with the view that a modest economic
THE cost of Ireland’s debt continued to porate tax base” policy for the entire upturn remains intact for the UK,
rise to all-time Eurozone highs yester- EU, to be drawn up by the European despite a GDP contraction of 0.6 per
day, putting pressure on new Prime Commission. cent in the final three months of last
Minister Enda Kenny to secure less However, the proposals, which will Industrialists defied bad winter weather in much of the euro area year,” commented Howard Archer of
punitive rates on its €85bn (£73.5bn) be announced tomorrow by EU com- IHS Global Insight.
Eurozone leaders to keep Irish interest Overall, the Eurozone pact brokered EUROZONE ECONOMY per cent, and up 6.8 per cent across attempt to predict turning points in
unchanged while lowering Greece’s on Saturday has received a conditional the wider European Union. economic activity six months ahead.
rate by one per cent. Following the welcome from markets. Fitch Ratings INDUSTRIAL production in the “Adverse weather in early January “We project British GDP to grow by
move, the yield on five-year Irish debt said the deal was progress but “will Eurozone started the year on the up, is likely to have led to continued dis- 1.6 per cent in 2011,” Archer said.
spiked above 9.9 per cent, with rates not resolve market concerns over the official data showed yesterday. ruptions to business, and we expect The latest figures bode well for the
on ten-year debt similarly jumping ‘solvency’ of some highly indebted Production rose by 0.3 per cent on the rate of growth to improve global economic recovery, with
briefly above 9.69 per cent. euro area member states”. And the the previous month, despite markedly in February,” added Markit monthly upturns across the OECD
This was in sharp contrast to Greek House of Lords EU Committee said it December’s figure being hugely economist Chris Williamson. area, and specifically in Europe and
yields, which dropped slightly to 14.3 had “strong reservations” about how it revised upwards to show a 0.3 per “The purchasing managers indices Asia.
per cent on five-year and 12.4 per cent would be enforced. cent expansion, rather than the pre- also point to an acceleration in January’s scores were up 0.4 points
on ten-year bonds. Greece’s debt was In a sign that bond investors are still vious estimate of a 0.1 per cent February,” Williamson said. Among against the previous month, through-
effectively restructured as a reward for nervous, Portuguese yields spiked above decline. member states for which data are out the OECD’s 33 member countries
its progress on reducing its deficit, 7.8 per cent on five-year debt yesterday. Compared to the same time last available, industrial production rose – an annual improvement of 2.1
with bond maturities extended from Spanish yields, however, were down. year, Euro area industry was up 6.6 in 14 and fell in five. points, clearly indicating expansion.
Edwards plot stock market offering JP MORGAN Byers, who is responsible for some of
CAZENOVE the firm’s most important brokerage
relationships.
Managing director in the bank’s indus-
trial team Andrew Truscott and UK cor-
porate finance executive director Chris
the buyout vehicles once operated by The former chief financial officer of JONATHAN Wilcox is leading the JP Nicholls are also advising.
▲
TECHNOLOGY
BY RICHARD PARTINGTON US investment bank JP Morgan, own 45 drinks giant Diageo, Nick Rose, will Morgan Cazenove advisory team on the Swiss bank UBS’ team is led by
per cent of the company each, whilst step in as chairman of the firm follow- Edwards Group initial public offering Christopher Smith and Adrian Lewis.
BRITISH vacuum technology producer management retains the rest. ing the listing. (IPO). As vice president of investments for
Edwards Group is plotting a London The owners must offer at least 25 per Founded in 1919, the West-Sussex The US investment bank is acting as the bank, Smith has recently advised US
listing to raise at least £375m. cent of the company in order to list in based firm made pre-tax profits of joint lead adviser together with Swiss media firm Perform on its London listing.
The firm provides chipmakers with London. £130m on revenues of £641m. lender UBS on the listing. He also worked on the advisory for a
vacuum technology needed to make Edwards did not give any detail of Edwards chief executive Matthew As head of UK equity capital markets £242m share raising by British super-
microprocessors, used in products the expected size of its offering, Taylor said: “This is a very exciting time at JP Morgan, Wilcox has led many of market chain Sainsbury’s.
such as Apple’s iPad. although said it will not include any for Edwards as we work towards a the bank’s highest profile deals in recent Morgan Stanley; led by Scott Matlock
Its private equity backers own a com- new shares. potential IPO and listing. years, including rights issues for and Ben Grindley, and Deutsche Bank;
bined 90 per cent stake of the firm, It will announce price details over “The group has been transformed Standard Chartered and Rio Tinto. led by Lorcan O’Shea and Edward
which was valued at £1.5bn last year. the coming weeks, and is expected to over the last four years, developing into He also handled the IPO for Jupiter Sankey, are also advising on the listing.
CCMP Capital and Unitas Capital, list before the end of next month. a world class operation.”
14 News CITYA.M. 15 MARCH 2011
RECRUITMENT
match inflation, with a third of CFOs “Dissatisfaction about pay is
BY JULIET SAMUEL planning to put them up by three to inevitable among such a hyper-com-
▲
CITY firms are struggling to hang on four per cent, and half planning to petitive cohort as investment bankers BANKING without proper documentation.
to staff despite plans to increase raise them by five to six per cent. – they see bonuses as the way to keep The emails involve a discussion
salaries and bonuses by more than Numbers from rival City recruiter score and they hate to lose.” BANK of America (BoA) became the between employees of BoA subsidiary
inflation, according to two surveys by Astbury Marsden show why: it says He added that some investment latest target of hacker group Balboa Insurance regarding remov-
recruitment firms. the number of applications it banks are reporting staff turnover for Anonymous when confidential ing documents from loan files for a
Financial recruiter Robert Half says received in February has soared to the first quarter of 20 per cent – way emails were leaked online. group of insured properties.
that a survey of 280 chief financial 7,400, a 47 per cent jump year-on-year above the usual churn that follows Anonymous, a group sympathetic There was some indication that
officers (CFOs), shows 61 per cent of as disgruntled employees consider bonus season. to WikiLeaks, say the documents material pointed to in the emails had
listed firms are planning to put up options and prepare to ditch their The rise in applications has not relate to the issue of whether BoA has been recently removed, with many
salaries in coming months, more current employer. quite been matched by an equivalent improperly foreclosed on homes. links leading to blank pages.
than two thirds of them by five to six The data shows that non-top tier jump in vacancies, but there were However, the emails do not appear A BoA spokesman said the docu-
per cent and a fifth by seven to 10 per investment bankers, in particular, are nonetheless 30 per cent more jobs to be as damning as the hackers hope, ments were stolen by a former Balboa
cent. upset about their pay levels. added to the recruiter’s register this with little evidence backing up the Insurance employee, and were not
The research also shows that Astbury Marsden chief operating February than last. claims that BoA foreclosed homes related to foreclosures.
Bovis doubles
NEWS | IN BRIEF
Hongqiao cuts IPO size to $1bn
China Hongqiao Group, China’s biggest
privately owned aluminium hydroxide
HOUSEBUILIDNG
its dividend – with a proposed pay- (£3.1bn) worth of ships with a group
BY JOHN DUNNE
HOUSEBUILDER Bovis Homes yester-
ment of 3p for 2010 – as a result of
the positive figures. The last time a
ANALYST VIEWS: WILL THE BOVIS FIGURES of other investors to tap growing ship-
ping demand in the region. The joint
day said its 2010 profit more than
doubled and that it had made an
dividend was paid was 2008.
Economists are predicting a testing
IMPRESS INVESTORS? Interviews by John Dunne venture will commence operations
immediately and has committed to
encouraging start to 2011. year for housebuilders and muted invest equity capital of $900m in the
Bovis reported a pre-tax profit last growth at best, as economic uncer- KEITH BOWMAN | HARGREAVES LANSDOWN next five years. Private equity firm
“
year of £18.5m, compared with £7.5m tainty and a struggle to access credit Carlyle said the venture would buy
the year before. deter buyers from entering the mar- container, dry bulk, tanker vessels and
The company had been expected to ket. Bovis said mortgage availability Bovis has weathered the credit crisis relatively well, and is in better other assets. Their partner Seaspan
post a profit of £18.54m, according to will continue to restrain buyers in shape than many rivals. Despite a broadly positive update, the shares are general- and the Washington Family will invest
”
a poll of analysts. 2011 but expects prices to remain sta- ly assessed as being ‘up with events’, with rival housebuilders potentially offering in container vessels purchased by the
Chief executive David Ritchie said: ble as a whole. better value. As such, market consensus opinion denotes a ‘Hold’. newly-formed firm, it said.
“The group has delivered a strong The Kent-based group, which is
improvement in profit in 2010, driven debt free, added: “With the supply of St Ives to sell magazine arm
by increased volumes, stronger sales consented land likely to be con- MARK HUGHES | PANMURE Printing company St Ives said it
“
prices and delivery of cost savings.” strained in the future, given the plan- agreed to sell its loss-making maga-
Bovis spent £203m on land in 2010, ning environment we believe that zine business for £20m to a unit of pri-
acquiring 3,700 plots mostly located this is an excellent time to invest.” Although the group has seen a good start to the year with reservations vate equity firm Walstead
in the south of England, and has up 11 per cent in the first nine weeks, given the early stage of the year, we main- Investments. St Ives, which prints a
”
agreed terms to buy another 2,500 ANALYSIS l Bovis Homes 442.50 tain our forecasts for now. Our target price rises from 450p to 459p as we move range of products from books to CD
this year, it said. 460
14 Mar to 2011 multiples, though our recommendation remains ‘Hold’ and DVD cases, said it would receive
p
The average selling price of a Bovis £15m in cash on completion of the
home rose by 3.9 per cent to £160,700 440
deal and £5m in loan notes. Walstead
in 2010, and the group achieved 1,901 RICHARD CURR | PRIME MARKETS Investments is backed by Bank Leumi,
“
completions in the year, up from Israel’s largest bank. St Ives’ magazine
420
1,803 in 2009. business has been struggling in recent
The company, which expects to Bovis has invested heavily in new land plots, which is a clear sign of years as excess capacity in the market
open 33 new sales outlets in 2011, 400 lowered prices, and advertising and
confidence, but it is perhaps the reintroduction of the dividend that draws the line
”
said it had made an encouraging start in the sand and moves the recovery from ‘tentative’ to ‘solid’. We believe the content moved to digital formats. The
in the first nine weeks of the year, 380 shares offer an attractive sector play at current levels. division posted a pre-tax loss of £5.1m
with reservations up 11 per cent. 20 Dec 12 Jan 1 Feb 21 Feb 10 Mar on revenue of £70.5m.
TELECOMS
▲
RECRUITMENT
BY STEVE DINNEEN Colao has said he will not be forced firmed the £4.3bn sale of its interests the latest figures showed they were
into making the sale and several ana- in China Mobile. Other non-core ven- RECRUITMENT specialist Hydrogen starting to pay off.
VODAFONE may receive far less than lysts said although they did not think tures likely to be disposed of soon Group reported a 67 per cent jump in “Our key plan over the past few
it had hoped for its stake in its French that £6bn was an unfair price, they include Vodafone’s 25 per cent stake its full-year revenue yesterday, with years has been the internationalisa-
joint venture, sending its shares thought that Vodafone could wait to in Poland’s Polkomtel. 2010 figures reaching £123.4m. tion of the business,” Smeaton told
down two per cent yesterday. see if the price improves. A final decision on its large minor- The group’s net fee income rose 64 City A.M. “And the 138 per cent
It is in talks with Vivendi over the A crucial part of the deal will be ity stake in US-based Verizon Wireless per cent to £27.6m and pre-tax profits increase in international net fee
sale of its 44 per cent stake in SFR but whether Vodafone and Vivendi can is not expected until 2012 but ana- increased to £2.5m, compared with income shows we’re moving in the
it is understood the French firm is agree a long-term roaming deal which lysts expect Vodafone to maintain its £0.3m before exceptional costs in right direction.”
only willing to pay £6bn. Vodafone would allow Vodafone customers to interests after indications dividend 2009. Hydrogen has offices in Singapore
had hoped for closer to £7bn for the access the SFR network in the future. payments will resume later this year. Hydrogen chief executive Tim and Sydney as well as London, and
asset, which it is purging as part of its In November Vodafone sold its Vodafone’s shares closed 1.8 per Smeaton said significant investments plans to open a new office in Hong
strategy to offload non-core assets. £3.1bn stake in Japanese carrier cent lower yesterday at 175.74p. had been made in the company Kong in the first half of this year.
CITYA.M. 15 MARCH 2011 News 15
CITY MOVES | WHO’S SWITCHING JOBS Edited by Harriet Dennys in association with
based corporate finance team. income, currencies and commodities for Standard Life, where he held the role of
SJ Berwin Previously, he held positions at NM the Americas at Société Générale. senior pensions policy manager.
The international law firm has appointed Tony Rothschild and Robert Fleming & Co.
Angel, chief executive of healthcare technology White & Case Sacker & Partners
group Vantage Diagnostics, as a non-executive Cordea Savills The law firm has appointed Maxim The pensions law firm has promoted
director. As managing partner of Linklaters from The property fund manager has Telemtayev as executive partner in the Claire van Rees to associate. Van Rees
1998 to 2007, Angel presided over a 57 per cent appointed Nick Hayward as director of firm’s office in Almaty, Kazakhstan. joined Sacker & Partners from Hogan
turnover increase and a 108 per cent profit institutional business. Hayward joins Telemtayev joins from Macleod Dixon, Lovells in 2010 and has six years’ pen-
increase. In 2008, he joined ratings agency from JP Morgan Asset Management, where he was managing partner for the sions experience.
Standard & Poor’s as executive managing direc- where he was a client portfolio manag- law firm’s practice in the Republic of
tor and head of EMEA, where he was responsi- er for real assets in Europe. Kazakhstan. FXall
ble for more than 1,000 employees worldwide. The electronic foreign exchange plat-
Yorvik Partners MGM Advantage form has appointed Kevin Lupowitz as
The debt broker-dealer has appointed The retirement income specialist has chief information officer. Lupowitz, who
Northland Capital Partners corporate finance in its London office. Paolo Taddonio as chief executive. appointed Andrew Tully to the newly joins from Liquidnet, will be responsible
The full-service investment bank has For the past seven years, Metcalfe has Taddonio, who joins the firm immedi- created role of retirement income tech- for leading FXall’s technology strategy
appointed Tim Metcalfe as director of led Westhouse Securities’ London- ately, was previously head of fixed nical manager. Tully joins from and creating opportunities for growth.
BEST OF THE BROKERS To appear in Best of the Brokers email your research to notes@cityam.com
760 310
14 Feb 21 Feb 28 Feb 7 Mar 14 Mar 14 Feb 21 Feb 28 Feb 7 Mar 14 Mar 14 Feb 21 Feb 28 Feb 7 Mar 14 Mar
THELONDON Japan.
“The market doesn’t forget and in
high. The next support, a 61.8 per
cent retracement is at 5,744. THENEW YORK New York Stock Exchange. Both
nuclear power companies traded on
REPORT REPORT
1995 following the Kobe earthquake, Graham Secker, European equity volume that was more than 10 times
a smaller disaster compared to last strategist at Morgan Stanley, said their 10-day average.
Friday’s one, we must remember the bank had moved to a more General Electric, which has com-
that the Nikkei lost over 20 per cent. defensive stance, with telecoms bined nuclear ventures with Hitachi,
T
HE FTSE 100 share index hit a As things stand we’ve lost nearly 10 looking particularly favourable, as dropped 2.2 per cent to $19.92 and
U
fresh three-month closing low per cent,” a trader said. he saw a peak in leading indicators S stocks fell in the wake of was the top percentage decliner on
yesterday, with some sectors Temporary power generators being reached. Japan’s devastating earthquake the Dow.
seen vulnerable to further falls provider Aggreko rose 8.2 per cent as Risky assets such as banks, miners yesterday, but other than specif- “This is a knee-jerk reaction, but it
as the extent of the damage in Japan demand for its services was seen and integrated oils were all down as ic industries such as nuclear could put a lid on building new
after the earthquake and tsunamis coming from Japan. The firm said it sectors. power, the broad impact on equities nuclear plants,” said James Dunigan,
becomes clearer. was ready to equip Japan with some Heavyweight Vodafone was a sig- was expected to be short-lived. chief investment officer at PNC
Luxury goods firms such as of its self-contained gas and diesel nificant drag on the index, slipping Trading volume was unusually low Wealth Management.
Burberry Group and insurers includ- generators if asked. 2.2 per cent after the Financial compared with other sell-offs, com- Japanese ports handling about
ing Aviva and Catlin Group were Meanwhile gas firm BG Group was Times said European telecoms and ing in at 7.68bn shares traded on the seven per cent of the country’s indus-
among the top fallers as Japan faced up 3.7 per cent. “Disruptions to entertainment group Vivendi is not New York Stock Exchange, the trial output sustained major damage,
the economic impact of a disaster nuclear power supply could see willing to pay much more than American Stock Exchange and disrupting the flow of goods globally.
that has killed thousands. Japanese LNG (liquid natural gas) £6bn for Vodafone’s stake in SFR. Nasdaq, below last year’s daily aver- The Dow Jones industrial average
The FTSE 100 closed down 53.43 demand increase. This would reduce Miner Vedanta rose 1.6 per cent age of 8.47bn. The recent pullback in was down 51.24 points, or 0.43 per
points, or 0.9 per cent, at 5,775.24. global LNG oversupply and support a after the Indian regulators said they stocks had been accompanied by high cent, at 11,993.16. The Standard &
The blue-chip index has lost almost recovery in European gas and power had wrapped up an investigation volume. Poor’s 500 Index was down 7.89
200 points in the past four trading prices,” UBS said in a note. into the firm’s $9.6bn (£5.9bn) pur- “I’m encouraged that we’re seeing points, or 0.60 per cent, at 1,296.39.
days with sentiment weighed on by BG Group signed a 20 year LNG chase of some of Cairn’s assets, lighter volume on a down day since The Nasdaq Composite Index was
violence in Libya, Eurozone debt sales deal with Tokyo Gas last week. fuelling speculation that the acqui- that could suggest less enthusiasm down 14.64 points, or 0.54 per cent, at
worries and Japan. Away from Japan, strong sales of sition will win approval. for selling,” said Hank Herrmann, 2,700.97. Texas Instruments fell 2.2
British-listed insurers fell further the second-generation iPad in its chief executive of Waddell & Reed per cent to $33.80 in extended-hours
with Aviva and Catlin each falling opening weekend boosted ANALYSIS l FTSE Financial. trading after the chipmaker said it
more than three per cent. Imagination Technologies up 5.5 per
5,775.24 Nuclear power stocks fell after will lose revenues due to production
p 14 Mar
“The earthquake, tsunami and the cent. Its graphics chip is used in the 6,100 explosions at a Japanese plant. The delays at its Japanese facilities from
aftershocks expected this week are popular tablet. Market Vectors uranium and nuclear quake-related interruption of power.
6,050
likely to generate one of the largest Lack of confidence among energy exchange traded fund US-listed shares of Japanese compa-
reinsurance losses seen,” said Kevin investors dogged the FTSE, which is 6,000 slumped 12 per cent while the Global nies declined and the BNY Mellon
Ryan, analyst at Investec Securities. also under pressure from technical 5,950 X Uranium ETF sank 17 per cent. But index of leading Japanese American
“If this happens, it will affect indicators, which suggested that the 5,900
the Market Vectors Solar Energy ETF Depositary Receipts lost 5.3 per cent.
insurance and reinsurance pricing index is vulnerable to further signif- of alternative energy shares climbed Toyota Motor, which said it would sus-
and it may affect equity markets.” icant weakness. 5,800 7.2 per cent. pend production at all its Japanese
Fashion group Burberry shed 4.3 The index was below 5,812, the 50 5,800 Shaw Group sank 9.2 per cent to car plants, fell 4.6 per cent to $81.73
per cent as analysts said demand for per cent Fibonacci retracement of 20 Dec 12 Jan 1 Feb 21 Feb 11 Mar $34.87 in the session while Camec yesterday.
16 CITYA.M. 15 MARCH 2011
GOLD REMAINS
THE ULTIMATE Uncertainty hangs over
SAFE HAVEN
DAVID MORRISON
Japan in wake of quake
CFD MARKET STRATEGIST, GFT
The country has
L
AST week brought up a host of challenging issues
for investors which seem likely to build in intensity, been in the doldrums
at least in the short-term. The terrible earthquake
and tsunami which hit Japan on Friday has added for years and this
to nervousness leading to a general loss of risk appetite.
The sell-off in equities, the surge in the yen and last
week’s dollar rally all conspired to wrong-foot investors.
disaster won’t help,
Consequently, markets which have out-performed
recently (such as oil and precious metals) have come
says Philip Salter
under pressure as hedge funds and others rush to
T
lighten up their long positions to raise cash. HE Great Kanto earthquake struck
The sell-off in oil was exacerbated by the shifting Japan in 1923, killing over 100,000
geopolitical situation across north Africa and the people. In consequence, one day
Middle East. In Libya, forces loyal to Gaddafi success- every September, children train for
fully counterattacked anti-government rebels. This the next earthquake. Tragically, last Friday
increased the likelihood of a quick resolution to the that training was once again put to use. On
unrest. In addition, the planned “Day of Rage” in Saudi Monday, the Nikkei index slumped 6.18 per
Arabia passed without major incident. But there were cent, with the prospect of further falls over
violent protests in Bahrain on Sunday and Saudi forces the coming days.
have crossed over the causeway between the two Sentiment towards Japan has been bear-
kingdoms and have entered the main island. This has ish for years – in fact, it hasn’t recovered
the potential to destabilise the region far more than from the bursting of its property bubble
protests within Saudi Arabia alone, as it pits Sunni twenty years ago. But as Angus Campbell of
against Shia in a highly visible manner. The prospect of London Capital Group says, the disaster has
an escalation in these tensions saw traders move back been “incredibly bad timing”. “We have
tentatively into crude oil yesterday. seen anaemic growth in Japan and this
Precious metals are also proving to be highly comes at a time when there were small
volatile. Last Friday, silver prices were slammed lower glimmers of hope forming.” Campbell sug-
for a second day in a row with $36 per ounce proving gests that the reaction to the Kobe earth-
to be a significant resistance level. Given the stunning quake could be illustrative. Sixteen years
rally in silver over the last six weeks, some profit-tak- ago Kobe struck and the Nikkei plunged by The reconstruction job is going to be a mammoth task Picture: REUTERS
ing and consolidation would seem in order. Although around 25 per cent over six months.
silver then recovered strongly, it was caught up, along Companies involved in the nuclear disaster is still unknown. However, she back into recession.”
with crude oil, in a “risk asset” sell-off as long-side industry have come in for the biggest believes “the drop in domestic demand, as David Jones of IG Group is optimistic in
leveraged speculators were forced to unwind positions drumming. Tokyo Electric Power, which well as the reduction in factory output, will medium term though, suggesting that
due to margin calls in other financial instruments. But manages the Fukushima plant, fell 24 per most likely see a second successive quarter things might turn once the costs of
despite this, precious metals are finally behaving as the cent, while Toshiba, which makes nuclear of contracting GDP and therefore a slip clearing up after the disaster and the
ultimate stores of value. They are now eclipsing the US reactors, is down 16 per cent. Baum is wor- uncertainty surrounding the nuclear issues
dollar as a safe-haven for investors. Although the sell- ried about the industry recovering “as the ANALYSIS l Nikkei 225 currently weighing heavily on markets
off in silver has been vicious, the bulls can take com- Japanese have been long term exporters of 10.80k become clearer. Jones says that with the
JPY
fort that gold has managed to hold onto support in the safe nuclear technology, as well as world 10.70k Nikkei having dropped around fifteen per
$1,400/10 range. If it can hold above here, then this leaders in research and development in cent in the last three months, some confi-
should help silver to stabilise, and build on support nuclear energy.” Carmakers have also 10.60k dence might return in the next few days.
around the $34 level. taken a tumble. Nissan and Toyota are 10.50k
CFD investors might consider backing this
down 9.5 per cent and 8 per cent respective- mid-term optimism.
ly. Construction is the only area that looked 10.40k Hopefully, Japan can recover from this
bullish. Nishimatsu Construction is up 21 10.30k
catastrophe as quickly as possible and its
per cent and Kajima is up 17.9 per cent. “lost economy” will find its way out of the
Lisa Baum at Cantor Index says that it is 10.20k doldrums. But realistically most investors
hard to know what is going to happen in Source: Yahoo Finance are pessimistic about its long-term future –
the long-term, while the full extent of the 20 Dec 2011 17 Jan 31 Jan 14 Feb 28 Feb earthquake or no earthquake.
A
NALYSTS are expecting hurdle to a push higher. Spread leaving the sector as a whole to
Greggs’ final results tomor- Co offers a spread of 1,488.9p- suffer. BP – which could be con-
row to show an increase in 1,492.1p. sidered to still be trading at a
profit. Last year saw a There is talk of a potential rise discount after last year's huge
boost for the bakers. However, ris- of silver to $50/ounce by the spill in the Gulf of Mexico – is
ing commodity prices have been end of the year, as production is lagging along with its peers.
dominating the headlines this year. not keeping up with current Current IG Markets price is
Cantor Index offer a daily spread demand. With gold prices rising 464.10/464.15p.
of 479.1p-483.8p. as well, consumer demand for Philip Salter
Japan’s energy minister has ordered the release of some strategic oil stocks
Events in Japan
decide nuclear
option’s future
CFD opportunities in the energy sector
hinge on reactor’s fate, says Craig Drake
S
INCE the impact of the earth- term, we expect fossil fuels to be the
quake that hit Japan last week, key energy beneficiary of the events in
and the devastating effects of Japan. However, on sustainability
the tsunami that followed in its grounds, we believe the ultimate win-
wake, the Japanese central bank has ner will be renewables.”
been throwing yen by the trillions into David Morrison, market strategist at
the economy to try and mitigate the GFT, does not see the outcome as
disaster’s effects. At the same time, the being so definite: “There has been a
government has taken a similar inter- reticence in developed nations to
ventionist approach to the country’s ramp up their nuclear fuel producing
oil reserves. capacity, however there has been a
According to Banri Kaieda, Japan’s steady move amongst the developing
de facto energy minister, the Japanese BRIC nations, especially India and
government has reached the decision China, to expand their energy base,
to allow the release of three days’ decreasing their reliance on fossil
worth of consumption from the coun- fuels in favour of nuclear energy.” As a
try’s strategic petroleum reserves. result of this, as you can see from the
These are held by the private sector to graph below, Cameco, Paladin and
ease oil supply shortages. Uranium One, which together pro-
The Dow Jones Japan electricity and duce around 20 per cent of the world’s
the oil and gas total stock market uranium, have seen healthy growth.
indices, which have seen a -11.5 per Although he says that TEPCO’s sec-
cent and -8.69 per cent shift respective- ond reactor could be to nuclear ener-
ly on the US dollar price return since gy what the BP oil disaster was to
the earthquake hit, will have investors deep sea drilling, ironically, he pre-
waiting in the wings. However, with dicts that BP, along with other oil
the government already having companies, could be a big winner as
demonstrated its intention to inter- part of Japan’s need for oil in its
vene heavily, those ready to speculate rebuilding operation over the coming
in the sector may be kept at bay. months.
In the long term, the future of the
nuclear fuel industry will hinge on ANALYSIS l Top uranium producers
that of the nuclear reactor of Tokyo %
Electric Power Company’s (TEPCO) 80
Fukushima Daiichi reactor.
Ankit Jain, equity research analyst 60
at Standard and Poor’s, views the like-
ly outcome of events as being higher 40
regulation of the industry, pushing Cameco
governments further towards a focus 20 Paladin
on sustainable energy: “Safety con- Uranium One
cerns alone may prompt governments 0
to explore other power sources. Near Oct Nov Dec 2011 Feb Mar
18 Markets & Investment CITYA.M. 15 MARCH 2011
)L'&' )'L'&'
$@713 65 756 =E In association with $@713 65 756 =E
& %)
".
'(#!
Don’t miss breaking !
#(( '
#
A tapas triumph
in Covent Garden
The folks behind Salt Yard and vibrant bar and restaurant that has all the
boisterous atmosphere of a proper old
West End boozer with food that’s far supe-
Dehesa have done it again with rior to anything you’d find in one.
It’s also smart business: tapas is surely
this moreish, theatreland eaterie the ideal cuisine for theatregoers needing
to fit in a bit of this and that before cur-
tain-up, and with tapas of this quality
Opera Tavern is in a they’ll be coming back in the interval and
Opera Tavern former pub. missing the second half.
We were due to eat in the main restau-
23 Catherine St, WC2B 5JS, rant area on the first floor, but thanks to a
Tel: 020 7836 3680 www.operatavern.co.uk booking mix-up, found ourselves without really working out where to start. The wine list is impressive, with plenty
squeezed into a tiny table in a nook in the After struggling over it with the help served by the glass to mix and match
FOOD hhhhi bar downstairs – a happy mistake. It’s of a few glasses of Prosecco, we gave up with different courses. Puddings – well,
SERVICE hhhhi noisy and fun down there, with the ele- and let the staff decide for us, tucking um, I can’t remember what they were. I
ATMOSPHERE hhhhi ments of the old pub interior – grand win- into a healthy selection (a cardiologist was enjoying myself too much – it’s that
dows, dark wood panelling, that lively might contest that) of the whole menu. kind of a place. I think there was some
Cost per person without wine: £35 tavern atmosphere – injected with a bit of Among the stand-outs were the deeply unctuous chocolate fondant involved,
Latin vim. Attention is focused on the bar, flavoursome Iberico ham carved in strips along with some sweet dessert wine.
where you’re invited to sit and eat tapas from the aforementioned leg; beef onglet Oh I’ll say it, I fair staggered out of
O
PERA Tavern has been opened by finger food. Beyond it, a stout leg of served pink and bubbling hot from the Opera Tavern. The wine flowed, the food
the husband and wife team behind Iberico pork sits on its stand next to a grill on a skewer with porcini mushroom came in endless rounds of small plate joy,
two of London’s best-regarded tapas large robata grill, whose smoky, meaty and winter truffle; and delightful mini my pal and I had a jolly good argument –
restaurants, Salt Yard and Dehesa. fumes create a beautiful fug. burgers of grilled pork and foie gras, a waving pinchos morunos skewers in the
This one’s in Covent Garden, just off the The menu is divided into smaller bar combination that felt naughtily indul- air to make our points – and set the
piazza, and used to be one of theatreland’s snack, charcuterie and grill dishes, and gent. Some sturdy salt cod was served world to rights by the time we finished
better, friendlier pubs. more elaborate tapas dishes. It’s a little with pleasing “arroz negre” squid ink- things off with some fortifying sherry
Losing a good pub is a shame, but it’s confusing and overwhelming, one of blackened rice, while the confit of pork (there is a neat list of 10). As I said, it’s
exciting to see it reborn as a thriving, those menus where you can look and look belly was heartily wonderful. that kind of a place.
Barbados
BEST BEACH bers dressed in colourful costumes South Coast is known as one of the
Crane Beach is considered by many to be depicting various themes. world’s best areas for windsurfing. A
one of the island's most beautiful beach- must-do is a catamaran cruise with a
es. In fact, Lifestyles of the Rich and BEST AREA FOR NIGHTLIFE Bajan lunch and snorkelling with turtles.
Famous rated it as "one of the 10 best The St Lawrence Gap is one of Barbados’
beaches in the world". The name “Crane” most lively areas and is home to a num- CHOICE PICK
was derived from the large crane situat- ber of hotels, apartments, restaurants, The British Airways Football Legends
ed at the top of the cliff which was used shops, street-vendors (both food and Invitational Tournament is scheduled for
for loading and unloading ships. The handicraft), bars and clubs. After dinner 10-11 June. The event, endorsed and sup-
Crane Resort & Residences, standing on The Gap, as it is known locally, comes ported by the Professional Football
the cliff above the beach, has been a alive and people can be seen hanging out Association (PFA), will feature eight UK-
favourite with honeymooners since 1867.
on the decks of the bars, watching the based, eight-man teams including
constant traffic or dancing the night Manchester United, Chelsea, Arsenal,
BEST ART AND CULTURE away in one of the nightclubs. Liverpool, Tottenham Hotspurs,
Crop Over is Barbados' most popular and Newcastle, Blackburn Rovers and a
colourful festival. Its origins can be BEST ACTIVITIES/SPORT Premier League All-Star team. These
traced back to the 1780's, a time when For avid sporting enthusiasts visiting teams will feature past greats including
Barbados was the world's largest pro- Barbados, there is an abundance of Alan Shearer, Andy Cole, Matt LeTissier
ducer of sugar. At the end of the sugar activities year round to whet the and Roberto DiMatteo. For more details,
season, there was always a huge celebra- appetite. These include cricket, football, visit the website www.barbados-football-
tion to mark the culmination of yet horseracing, polo, golf, rallying and div- legends.com.
another successful harvest – the Crop ing. Many hotels offer water sports
Over celebration. The festival is a cultural activities including water-skiing, wind- British Airways offers holidays to
mix of song, dance art and craft culmi- surfing, snorkeling, sailing and parasail- Barbados from £549pp. Terms and con-
nating with Kadooment Day, a carnival ing. The West Coast is ideal for ditions may apply. See ba.com for
parade featuring large bands with mem- snorkeling and water-skiing, while the details.
Bermuda
BEST BEACH ry, enjoying stunning views from the Bermuda is the undisputed shipwreck
All along our fine shores you can find ramparts, or exploring Bermuda's capital of the Atlantic and is the high-
beaches bathed in pink sand, made largest fort, there is plenty to see and light of their trip for many visiting
from finely pulverized remains of calci- learn at this important cultural attrac- divers. You can also explore over 200
um carbonate shells and skeletons of tion. square miles of coral reef through
invertebrates such as corals and clams. snorkelling and diving.
The pink sand makes the already poetic BEST ROMANTIC EXCURSION
scenery that much harder to resist. One step on our shores and you’ll DID YOU KNOW?
Once you step foot on Horseshoe Bay understand why we say, “Feel the Since 2007, Bermuda has been home
Beach you will realize why it is the Love”. You’ll discover romance at every to the PGA Grand Slam of Golf, the
most celebrated on the island. The long, corner, from our unique Moongates to season-ending showcase featuring
sweeping crescent of pink sand makes our pink sands. Start your day with an golf's premier foursome. The Mid
it a popular choice any time of year. intimate couples’ massage at one of Ocean Club hosted the showcase in
The nearby Beach House offers snacks, our world-class spas. End your day of 2007 and 2008, and in 2009 and
rentals and changing facilities. romance with a private dinner on the 2010 the tournament was held at our
beach, and just let our beautiful azure recently renovated and world-
BEST ART AND CULTURE waters, blushing sands and symphony renowned Port Royal Golf Course. We
The National Museum of Bermuda is of whistling tree frogs be your back- are pleased to announce that Bermuda
set within the Keep, a sprawling six- drop. and the Port Royal Golf Course will
acre fortress at the edge of the Royal return as hosts through 2012 for the
Naval Dockyard. Eight historic build- BEST ACTIVITIES/SPORT 29th and 30th editions of the event.
ings, including old munitions warehous- On our island you are never more than
es and the newly restored a deep breath away from the underwa- British Airways offers holidays to
Commissioner's House, contain a great ter experience of a lifetime. Dive below Bermuda from £739 pp. Terms and
variety of exhibitions on our rich histo- to visit more than 400 historic wrecks, conditions may apply. See ba.com for
ry. Whether taking in some local histo- some dating back to the 15th century. details.
CITYA.M. 15 MARCH 2011 Lifestyle 21
Dominican Republic
BEST BEACH BEST AREA FOR NIGHTLIFE skill level, whether you just want to
Located on the southern tip of Punta As the sun sets on the Dominican rent out equipment or get some one-
Cana, and just far enough from the Republic’s east coast, Punta Cana’s on-one lessons. The surf’s always up in
many resorts, Juanillo Beach features a famous nightlife begins. Mega clubs Cabarete.
forest of coconut palms that give way like Mangu, Areito and Imagine (a
to a lazy coast of white sands. disco inside a cave) attract a mix of BEST KEPT SECRET
Considered one of the best beaches in visiting tourists and locals from Exclusivity meets cosiness at the
the Dominican Republic and one of the around the country. For a relaxing, Peninsula House in the Dominican
best in the world, Juanillo’s coral reef local night out, many head to beach town of Las Terrenas. A boutique
shields its coast from rough surf, creat-
ing kilometres of serene waters lightly bars such as Soles and Photobar. Out guest house, the Peninsula House
washing Juanillo’s sands. and about in Punta Cana, the mix of offers guests pampering service, pri-
people is just as varied as its music, vate gardens and an ocean view
with Latin beats, reggaeton, electron- restaurant with candlelit dinners, all
BEST ART AND CULTURE ic and hip hop. within a warm home resplendent with
Declared a UNESCO World Heritage Victorian furnishings. Located in the
Site in 1991, the Colonial City of Santo BEST ACTIVITIES/SPORT lively beach town of Las Terrenas, the
Domingo was the first urban settlement Cabarete is a small, laid-back beach Peninsula House is in close proximity
in the Dominican Republic. It is also the village and the mecca for water to the town’s wide variety of restau-
site of numerous New World firsts – the sports in the Dominican Republic. The rants, nightlife, beautiful beaches and
first cathedral, hospital, palace, paved physical make-up of the area and its natural attractions, lsuch as the
street and university in the Americas winds make it ideal for kiteboarding, famous Limon Waterfall.
were all built here. The Colonial City is a windsurfing and surfing. Both water
cultural gem with quaint colonial plazas sport fanatics and beginners alike British Airways offers holidays to
and narrow streets brimming with flock to Cabarete from around the Dominican Republic from £869pp.
Dominican culture in its authentic world. Visitors will find numerous Terms and conditions may apply. See
shops, art galleries, cafes and bars. schools that can accommodate any ba.com for details.
Grenada
BEST BEACH BEST AREA FOR NIGHTLIFE ture tours; and great river tubing on
Grand Anse Beach and Morne Rouge Grenada’s nightlife revolves around the Balthazar River
Bay are a pretty close tie, both are small beach-side bars and restaurants,
white sanded with lots of space and servicing local Carib beers and a whole CHOICE PICK
few crowds. Grand Anse allows visitors range of Rum punches. Belmont Estate is the premiere tourism
to walk its full length and take exercise, Grenada boasts three main nightclubs – attraction on thGrenada. Located in St
while dipping in and out of the gentle Fantasia 2001, Bananas and Karma – Patrick, only an hour’s scenic drive from
waves. Morne Rouge’s trees and stun- all of which are within easy distance of the island’s capital of St George,
ning sunsets make it the perfect place the hotels. Belmont Estate is a unique and authen-
both for a day on the beach or a cocktai tic 17th century plantation that offers
after dark. BEST ACTIVITIES/SPORTS guests an opportunity to participate in
Grenada, only the size of the Isle of and observe the workings of a fully
BEST ART AND CULTURE Wight is lucky enough to have four functional historic plantation. Visit the
Grenada’s culture revolves around its hotels with good spa offerings; organic farm, gardens, heritage muse-
food and its small boat festivals. LaSource, Spice Island, La Luna and um, and cocoa processing facilities plus
Experience cuisine that is infused with Calabash Hotel. Each with a very dif- a goat dairy farm, petting farm, and
nutmeg, cinnamon, ginger and other ferent approach. For those of a more craft market.Grenada Carnival, which
locally grown spices, either at a local, active bent, watersports have devel- takes place on the second Monday and
traditional bar or at one of the interna- oped rapidly over the past few years, Tuesday in Augus, is the friendliest car-
tional hotels. Visit Grenada during the and Grenada now boasts the best nival in the Caribbean, safe and fun for
Workboat Regatta at the beginning of wreck diving in the Eastern Caribbean; the family.
February for a truly memorable experi- the Caribbean’s first underwater sculp-
ence and get to know the locals and ture park; a pirate ship for all the fami- British Airways offers holidays to
understand how this island state makes ly; donut boats; Shadofax luxury Grenada from £659 pp.Terms and con-
the most of the sea and the wonderful champagne and lobster and snorkelling ditions may apply. See ba.com for
fresh fish within it. tours; Seafaris powerboat eco adven- details.
22 Lifestyle CITYA.M. 15 MARCH 2011
W
spa packages that will show your mother nect with Mother HO knew that not going to work
you care (and haven’t forgotten her). dearest. could be so stressful? The day had
begun well, with an early morning
CITY POINT CLUB, MOORGATE cup of tea and Radio Four while the
Best for: the City mum (or the super-busy rest of the house slept. But then Noel had rolled
City daughter). out of bed in a foul mood, bemoaning the 363
The package: Called “I Love Mum”, it cer- days remaining until his next birthday. And
tainly gets to the point. You’ll both spend a brate your inevitable purchase, head to and aduki beans. The highlight is the lym- presents. And party. I began to say something
day at the club (a favourite with City high- the Mandarin bar for cocktails. Next day – phatic drainage using a jade roller. You’ll about Easter and Christmas but in search of
flyers) and will lunch together in your it’s a boozy brunch in Bar Boulud with a both look like a million bucks afterwards. vengeance he turned on me, asking why I was
robes, sip champagne, use the spa facili- bottle of wine and two Bloody Marys. From £195 for two people. www.chi-yu.co.uk still at home on a Monday morning and
ties and each have a short massage and £495 per person. Call 0207 235 2000 to book, or whether I’d been fired. Six going on sixteen.
facial. £199 for two. To book, email go to www.mandarinoriental.com. THE GROVE, HERTFORDSHIRE And now we’re in a gleaming consulting
Katie.shemesh@thecitypointclub.co.uk. Best for: Lovers of country house grandeur room. Emma is recumbent, her belly exposed.
CHI YU, MARYLEBONE The package: Set amid the glorious I watch it rise and fall. It doesn’t seem five
MANDARIN ORIENTAL, KNIGHTSBRIDGE Best for: Holistic mums with a penchant grounds of the Home Counties’ most opu- minutes since we were in the adjacent con-
Best for: fashionista mums for Eastern therapies lent hotel, this package includes three sulting room looking at the tadpole with the
The package: Go and paint the town red The package: A double massage. treatments, lunch and plenty of lounging: fierce heartbeat that would become Noel.
with this package of the same name, Therapists at this Japanese spa have some Mum will have an ESPA massage and And even less time since – well, since the
which combines every woman’s favourite of the best technique in London. Mothers facial plus a manicure with Leighton miscarriage 18 months later. I realise Emma
shoe maker, Christian Louboutin, with a are tactfully pointed towards an anti-age- Denny varnish. Next, she’ll have a two must be anxious. I take her hand. She turns to
day of luxury at the Mandarin Oriental. ing Naturalift facial with a cleanse, course lunch in the garden and use of the me. The young Australian sonographer
First, nails are sorted with a red manicure enzyme peel, massage, mask and moistur- luscious Sequoia spa all day. Until 30 April. approaches, drying her hands on a towel. “OK,
for you both. Next: a private appointment ising. Daughters receive the Chidoriya £155 per person. To book, call the Spa on 01923 we have all your details. Now, let’s have a look
at Louboutin’s Mount Street store. To cele- Japanese facial with rice bran, camellia oil 294 294. shall we?”
Emma squeezes my hand. The sonographer
applies lubricating jelly and rolls the probe
firmly over Emma’s belly. The Undersea World
SKY SPORTS 1 BRITISH EUROSPORT Cleveland 9pm Shock Docs: 11.30pm King of the Hill 12am Survivor 1am Deadliest Catch
SATELLITE & CABLE
7pm Sky Sports News at Seven 6pm Live WTA Tennis 10pm Teens Who Tie the Knot 10pm The Big Bang Theory 12.55am 2am Weaponology 3am World
7.30pm Soccer Special 10.30pm Extreme Sports: Freeride Spirit Bridalplasty 11pm Criminal Scrubs 1.45am Accidentally on War Two 3.50am Extreme
School of Hard Knocks 11pm A 10.30pm World Touring Car Minds 12am CSI 2.40am Purpose 2.30am Rick & Steve: Engineering 4.40am Raging
League of Their Own 12am UEFA Championship 11.05pm Best Charmed 4.20am Four The Happiest Gay Couple in All Planet 5.30am-6am How Does
Weddings 5.10am-6am Maury the World 2.50am Reaper That Work?
Champions League Highlights Battles Bikes 12.05am-12.35am CAROLINE QUENTIN: A PASSAGE
1am School of Hard Knocks Cycling 3.35am The OC 4.20am Style
1.30am A League Football 2am BBC THREE Her Famous 5am-6am Switched DISCOVERY HOME & THROUGH INDIA ITV1, 9PM
The actress travels by camel to
Football Asia 2.30am Revista De ESPN 7pm Total Wipeout 8pm Snog, HEALTH
La Liga 3.30am UEFA 7pm ESPN Exclusive Interviews: Marry, Avoid? 9pm Junior HISTORY 7pm A Baby Story 8pm How
Jaisalmer, Rajasthan, before visiting
Ahmedabad, and ends the second leg
Champions League Highlights Landon Donovan 7.15pm French Doctors: Your Life in Their Hands 7pm How the Earth Was Made Clean Is Your House? 9pm The of her journey in Mumbai.
4.30am School of Hard Knocks Top 14 Rugby Union 7.45pm 10pm EastEnders 10.30pm 24 8pm How Britain Bridged the Eight-Limbed Boy 10pm 999
5am Football Asia 5.30am-6am WRC: Access All Areas 8.45pm Hour Panel People 11.05pm World 9pm Monster Moves Emergency 11pm Real ER: The
Football’s Greatest NBA Tonight 9.15pm Baseball Family Guy 11.50pm Snog, Marry, 10pm Mega Movers 12am Bronx 12am The Eight-Limbed
Tonight 9.45pm ESPN Kicks: Avoid? 12.50am Junior Doctors: Monster Moves 1am How Britain Boy 1am 999 Emergency 2am
SKY SPORTS 2 Serie A 10pm World Series of Your Life in Their Hands 1.50am Bridged the World 2am Cities of Real ER: The Bronx 3am A&E
7pm Live UEFA Champions Poker Europe 11pm Live NHL Ice 24 Hour Panel People 2.25am the Underworld 3am Dinosaur 4am Bringing Home Baby
League 10.15pm Revista De La Hockey 1.30am Live Major Total Wipeout 3.25am Young, Secrets 4am UFO Files 5am-6am A Baby Story
Liga 11.15pm Golfing World League Soccer 4am World Jobless and Living at Home 5am-6am Ancient Discoveries
12.15am ICC Cricket World Cup Series of Poker Europe 5am 4.25am-5.25am Working Girls SKY1
2.15am-3.15am Golfing World Planet Speed 5.30am-6am DISCOVERY 8pm Live to Dance 9pm FILM LILY ALLEN: FROM RICHES TO
Russian Premier League Preview E4 8pm How Do They Do It? Gladiator 2000. 11.55pm Mental RAGS CHANNEL4, 10PM
SKY SPORTS 3 7pm Hollyoaks 7.30pm Friends 8.30pm How It’s Made 9pm 1.55am Miami SWAT 3.50am The singer and her half-sister Sarah
4pm Live Golf 9pm Live Masters SKY LIVING 9pm 90210 10pm The Cleveland Swords: Life on the Line 10pm Glenn Martin, DDS 4.20am Lost Owen plan to open a vintage clothing
Tennis 12am Pool 1am-3am 7pm Ghost Whisperer 8pm Show 10.30pm Bob’s Burgers HMS Ark Royal 11pm Get Out 5.10am-6am Sell Me the store, but retail guru Mary Portas is
British Basketball Cougar Town 8.30pm Hot in 11pm The Ricky Gervais Show Alive 12am Bear Grylls: Born Answer forced to deliver unpleasant news.
COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
QUICK CROSSWORD
SUDOKU KAKURO
3 22 21 16 40 16 12 30
26 29
21 25
Place the numbers from 1 to 9 in each empty cell so that each 10
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 5 16
17 44
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 14 24 8
above or to the left of it. 6 20
You can only use the digits 1-9 31
and you must not use the
23 23
10 13
same digit twice in a block. 22
The same digit may occur 42
11 28
more than once in a row or
column, but it must be in a
9
9
8
7
16
35 3
separate block.
17 9
20 14
10 27
ACROSS DOWN
1 Obvious and dull (5) 1 Injury which discolours
WORDWHEEL C A
3 Firm open-weave
fabric used by
window-cleaners (5)
the skin (6)
2 Person born under the
sign of the ram (5)
Using only the letters in the Wordwheel, you have 7 Positive or favourable 4 Turned-back hems at
ten minutes to find as many words as possible,
R G aspect (6) the ends of sleeves (5)
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters I 10 Young horse (4)
11 The smallest
5 Dairy product (4)
6 Pay back (9)
LAST ISSUE’S or more, all must contain the central letter and
letters can only be used once in every word. There
R E quantity (4)
12 Type of craftsman
8 Fixture found on a
chimney stack (3)
SOLUTIONS KAKURO is at least one nine-letter word in the wheel.
I T (10)
15 Type of coffee topped
9 Epidermal pore in a
leaf or stem (5)
QUICK CROSSWORD 9 8 7 3 2 1 3 8
with steamed milk 13 Characteristic of
S T A R C H S R
6 3 1 2 4 2 1 6 SUDOKU
and milk froth (10)
20 Afresh (4)
a sheep (5)
14 Solid substance
8 4 1 4 8 5 9
A I A C T I V E 21 Archaic word in the form of tiny
T U N N E L D A 3 1 8 2 6 1 4
Y S F R I E N D 7 6 1 5 3 2 4 meaning ‘in the loose particles (6)
R O M E O I C Y 1 3 5 2 9 6 7 8 direction of’ (4) 16 Dig into (5)
WORDWHEEL
U V E T A 2 9 6 3 8 7 4 22 Thin top layer on 17 Freight (5)
M M E E R R O R
E M B A R K U A
7 9 4 1 2 9 3 a solid floor (6) 18 Named prior to
R L N E L S O N
1 5 5 9 3 3 1 The nine-letter word was 23 Curl of the lip (5) marriage (3)
2 6 9 8 1 8 4 2
G H E T T O E C
STRETCHER
24 Climbing plant 19 Informal name
E D W A R M T H 5 8 7 9 7 9 8 4
supporter (5) for a cat (4)
Punter
24 CITYA.M. 15 MARCH 2011
| Cheltenham
RACING TRADER BILL ESDAILE, OUR RACING EXPERT, TAKES A LOOK AT THE
SUPREME NOVICES’ AND SPINAL RESEARCH CHASE
C
UE Card is aiming to do what I wouldn’t put anyone off having a Victor Chandler. He hated the heavy
Cousin Vinny and Dunguib small each-way interest in Malcolm ground at Haydock last time and will be
couldn’t by becoming the first Jefferson’s KING FONTAINE at 33/1 with much more suited to today’s conditions.
Supreme Novices’ Hurdle banker to
win since Brave Inca in 2004.
Colin Tizzard’s stable star has produced
some tremendous performances over hur-
dles this season, but the stats are against
him. Montelado in 1992 was the last
Champion Bumper winner to take this
race the following season and 13 of the
last 15 winners won last time out.
There is no doubt that Cue Card is the
likeliest winner, but it’s always a tough
race and he’s too short for me at 2/1.
Paddy Power are once again offering
their excellent Supreme Novices’ conces-
sion and will refund all bets if Cue Card
7PNKOKVGF
7 PNKOKVGF
F wins. Barry Geraghty has opted to ride
SPIRIT SON and that should be a tip in
itself as Sprinter Sacre also looks a top
HHCNNGTTGHWPFU
CNNGTTGHWPFU class novice.
I was hugely impressed with the selec-
tion’s jumping at Exeter last time and he
Q P#..HQWT
QP#..HQWT looks an each-way bet to nothing at 5/1
with Paddy Power, especially with the Cue
Card insurance.
%JCORKQPUJKR
%JCORKQPUJKR It’s interesting that Brian Ellison runs
Marsh Warbler in this rather than Friday’s
44CEGU
CEGU Triumph Hurdle and he might be able to
sneak into a place getting 8lb off the field.
The Stewart Family Spinal Research
Handicap Chase (2.40pm) is always one of
the big betting handicaps of the week.
Blazing Bailey has been revitalised this
Place
NCEGaCday
FC[ofQHrace
2NCEGCFC[QHTCEG
2 bet
TCEG season and Alan King’s popular nine-year-
old heads the weights on 11st12lb.
onGVtoday’s
QPVQFChampion
DGVQPVQFC[oU9QTNF
D C[oU9QTNF However, it’s the stable’s other runner
Bensalem who is set to be sent off
Hurdle
WTFNGand
CPFifKHyour
*WTFNGCPFKH[QWT
* [QWT favourite after two promising hurdles
runs this season. *
horse
J QTUGfalls,
HCNNUunseats
WPUGCVor
JQTUGHCNNUWPUGCVU U He was travelling like the winner in this
race last year when he came down two
isTbrought
Q down...
QTKUDTQWIJVFQYPe
KUDTQWI JVFQYPe out, but that was still a long way from
home and it’s a worry that the last 11 win-
ners of this race carried less than 11 stone
Y GoNNTGHWPF[QWT
YGoNNTGHWPF[QWT (he must shoulder 11st2lb).
David Pipe’s Great Endeavour won the
G
GPVKTGYKPUVCMGCUC
PVKTGYKPUVCMGCUC Byrne Group Plate at last year’s Festival
and ran a stormer in the Vote AP Gold Cup
HHTGGDGVPQNKOKVUQP
TGGDGVPQNKOKVUQP in December. He clearly loves
Cheltenham, but with 11st7lb on his back
UUK\GQHTGHWPFU
K\GQHTGHWPFU I’m prepared to look elsewhere.
There’s no-one better at preparing a
horse for a big Cheltenham handicap than
Jonjo O’Neill and he has a great chance
with SUNNYHILLBOY. Second to Great
Endeavour at last year’s Festival, he was
just six lengths behind the same rival here
in December and has always looked as
though he’d relish this step up in trip. He’s
a knocking each-way bet at 6/1 with Paddy
Power and William Hill.
2TQWFPGYURQPUQTQHVJG3WGGP/QVJGT%JCORKQP%JCUG
2 TQWFPGYURQPUQTQHVJG3WGGP/QVJGT%JCORKQP%JCUG POINTERS...
SPIRIT SON e/w 1.30pm Cheltenham
0QNKOKVTGHWPFUCRRN[QPFC[QHTCEGDGVUQPN[
CPVGRQUVDGVUFQPQVEQWPV
0QNKOKVTGHWPFUCRRN[QPFC[QHTCEGDGVUQPN[
CPVGRQUVDGVUFQPQVEQWPV
QPVJGHQWT%JCORKQPUJKR4CEGU6GTOU%QPFKVKQPUCRRN[sUGGYGDUKVG
QPVJGHQWT%JCORKQPUJKR4CEGU6GTOU%QPFKVKQPUCRRN[sUGGYGDUKVG SUNNYHILLBOY e/w 2.40pm Cheltenham
HQTFGVCKNU
HQTFGVCKNU
KING FONTAINE e/w 2.40pm Cheltenham
Punter
CITYA.M. 15 MARCH 2011 25
| Racing
INSIDER
the
oddschecker.com
All the latest odds and £100s of bookie freebets
C
UE CARD is the obvious place to this time last year by landing the Supreme That leaves QUEVEGA (10 per cent win)
start when looking at the Supreme Novices’ Hurdle. as the opening day banker in her attempt
Novices’ Hurdle as he stands out on Yet, as hard to beat as he may be, it’s not to land the hat-trick in the David
form. However, he has been off the often that Donald McCain is as bullish Nicholson Mares’ Hurdle.
track a little while and I worry that he about a horse as he is about PEDDLERS Finally, the last race of the day looks an
may get done for toe up the famous ‘hill’. CROSS (five per cent win) and he narrowly impossible puzzle to solve, but TULLAM-
The horse most likely to go past him is gets the nod. Elsewhere, I like the look of ORE DEW (0.5 per cent e/w) and complete
Nicky Henderson’s SPIRIT SON (three per old favourite BLAZING BAILEY (two per outsider QUO VIDEO (0.5 per cent e/w) are
cent each way) who has done nothing cent e/w) in the 2.40pm, who has per- two of the more likely sorts.
wrong so far and can cheer up his trainer formed with all his old relish this season, Check the latest prices of the Insider’s tips at
after the Binocular debacle. while POKER DE SIVOLA (one per cent e/w) www.oddschecker.com Bet with all the best book-
As for the Champion Hurdle itself, I can go well at a big price in the Cross ies and get exclusive sign up offers, promotions
respect Menorah who did us a good favour Country Chase at 4.00pm. and tips.
26 Punter | Racing CITYA.M. 15 MARCH 2011
CU E
3/1
RACING TRADER BILL ESDAILE, OUR RACING EXPERT, TAKES A LOOK AT THE ARKLE
PLUS 4 PLACES
GRADE 1 (1) 2m £74,113 Mrs S Smith John Conroy Jaqueline Conroy
10 2-12111 WEST WITH THE WIND (200)(D) 6 11-7 P Moloney 89
1 1-22221 CAPTAIN CHRIS [T] (17)(C)(D) 7 11-7 R Johnson 95
E Williams3 Mrs Janet Davies
P Hobbs Mrs Diana L Whateley
S.P. F’CAST: 11-4 Medermit, 7-2 Ghizao, 4 Finian’s Rainbow, 7 Captain Chris, Realt Dubh,
NE
AVAILABLE ONLINE, IN SHOP & ON THE PHO
205-0211d DAN BREEN [BH] (18)(D) 6 11-7 T Scudamore 87 12 Rock Noir, 14 Dan Breen, 25 Giorgio Quercus, 33 West With The Wind, 40 Stagecoach
D Pipe Stuart M Mercer CAPTAIN CHRIS (11-0) 2-5 fav tracked leader, led 7th, not fluent 11th but jumped with
plenty of zest apart, drew clear from 3 out, eased flat, bt Adams Island (11-4) 13l (3 ran)
3 315-111 FINIAN’S RAINBOW (31)(D) 8 11-7 B J Geraghty 95 (Kempton 2m41/2f nov ch G2(1) £13,340 good to soft).
GIORGIO QUERCUS (11-3) 11-4 raced in 2nd, hit 4 out, ridden after 3 out, stayed on under
4 N Henderson Michael Buckley pressure to challenge final 120yds, carried persistently right, just failed, finished 2nd,
A
4 Ghizao 12 Dan Breen LAN KING has a fantastic record in Nicky Henderson has always loved pretty poor Arkle if he was to win.
the Irish Independent Arkle Finian’s Rainbow and he was the clear The last 10 winners have all returned
5 Finian’s Rainbow 20 Giorgio Quercus Challenge Trophy (2.05pm), win- ante-post favourite after his two small 9/1 or shorter, so it’s not a race for the out-
15/2 Captain Chris 33 West With The W’ ning it with Voy Por Ustedes and field wins at Newbury. siders. Ireland have won the last two,
8 Realt Dubh 40 Stagecoach Pearl My Way De Solzen in 2006 and 2007. He is However, they tried different waiting though, so you’d have to give a squeak to
Each way ONE-QUARTER the odds a place 1, 2, 3.
set to rely on MEDERMIT this year and the tactics with him at Warwick last time and Noel Meade’s dual Grade One winner
seven-year old looks to have a favourite’s his jumping seemed untidy and occasion- Realt Dubh.
chance. Although he’s never won at ally clumsy. Connections have said since He’s beaten Noble Prince twice, but I’m
STEWART FAMILY SPINAL RESEARCH H’CAP CHASE Cheltenham, he arguably should have that they were trying to give him more just not sure how strong the Irish two
taken the 2009 Supreme Novices’ Hurdle experience by teaching him to jump mile novice chasers are. His trainer also
3 miles, Cheltenham 2.40pm, Live on C4.
and didn’t run that badly in the behind other runners and they look set to doesn’t have the best record at
6 Bensalem 20 Fair Along Champion Hurdle last season, when his allow him to bowl along from the front Cheltenham.
6 Great Endeavour 20 Rare Bob stable were out of form. this afternoon. Medermit is a very solid contender and
6 Sunnyhillboy 25 King Fontaine An impressive winner of the Scilly Isles However, Dan Breen is another con- my idea of the best bet on day one of the
Novices’ Chase at Sandown last time, he firmed front-runner and Finian’s Rainbow Festival. Sportingbet offer 3/1 and that is a
7 Reve De Sivola 25 Razor Royale jumped like a stag and was probably just is very likely to be taken on for the lead. fair price considering it doesn’t look to be
14 Blazing Bailey 25 The Rainbow H’ter idling when Captain Chris lunged late on. Admittedly, Henderson and Geraghty are the hottest Arkle.
14 Carole’s Legacy 33 Carrickmines He has always had the potential to be a aware of this and may use David Pipe’s That said, I certainly wouldn’t be sur-
14 Wolf Moon 33 The Sawyer top class chaser and that was his first per- runner as a lead horse. Yet, there is a prised if he traded far bigger in-running
15 Adams Island 50 Slippers Percy formance that screamed, “Arkle”. King chance his jumping may become unset- on Betdaq as this is bound to be run at a
reckons he will be better suited to a tled once more and I’d worry about him blistering tempo and he may have to
20 Chief Dan George 66 No Panic strongly run two miles and it is hard to staying on his feet. come from a long way back.
20 Exmoor Ranger see Captain Chris getting any closer to Ghizao is a more solid proposition hav- The only other trade I would be looking
Each way one-quarter the odds a place 1, 2, 3, 4. him over this shorter trip. ing won two competitive races this at is possibly laying Captain Chris for a
Above races: Prices subject to fluctuation. In the event of any withdrawal(s), One of the key features of Arkle season, beating Captain Chris place, also on Betdaq. Philip Hobbs’
S.P place terms and Tattersalls Rule 4(c) will apply based on these prices. winners in recent years is their ability to comfortably both times. He has jumped charge took forever to get going at
Non-Runner-No Bet. stay. My Way De Solzen had previously excellently, but there is a nagging doubt Sandown and I wasn’t that impressed by
won a World Hurdle, while 2008 champi- that he just isn’t a spring horse. He disap- his jumping either. All his best form is
on Tidal Bay is contesting this year’s Gold pointed at both Cheltenham and Aintree also on a right-handed track and I’d be
Cup. Medermit stays 2m4f well and that last year and even his co-owner Andy surprised if he managed to get into the
can only be good news for his supporters. Stewart has admitted that it would be a places.
I
am almost certain that Cue Card will The key to the Champion Hurdle is the running and it’s proved more profitable
stake, up to a maximum of £60. Quote promo code RP60* travel like the winner for much of the number of contenders who have the over time to hit the ‘lay’ button rather
opening contest (1.30pm), but there is potential to travel sweetly off the pace. than the ‘back’ one.
a danger he won’t find an awful lot Oscar Whisky, Hurricane Fly, Dunguib Overturn looks the most likely pace
off the bridle. Therefore, it may pay to and Mille Chief are the obvious four who angle in the race as he is sure to make it a
back him on Betdaq pre-race at around could easily still be on the bridle turning searching gallop.
the 3.2 mark and then look to lay your for home. Interestingly it may pay to adopt a
stake back and more at odds-on approach- However, the battle hardened pair of back-to-lay policy with him as if he opens
ing the second last flight. He may well Menorah and Peddlers Cross have come up on the front end, he may prove a diffi-
win, but I am not prepared to find out if up the hill before and may find more cult one to pass. If he is still in front
williamhill.com 0800 44 40 40 he’ll come up the hill and would prefer to when push comes to shove. Don’t get rounding the home turn, there is no way
lock in a profit whatever the result. sucked in to backing the ‘travellers’ in- he can still trade at 50.0 or bigger.
Ferdy Murphy
the man to be
feared in the
big handicaps
I
T’S been a disappointing season for STORY can hardly be described as improv-
Ferdy Murphy so far, but there have ing at the age of 13, but he won this race
been some signs of late that his last year and finished an excellent third in
string is starting to hit form again. his hurdle prep race at Naas earlier this
He has a formidable record at the month. You need a horse that truly stays
Cheltenham Festival and punters should and Michael Hourigan’s runner was
take notice when he says that DIVERS, in placed in this race in both 2008 and 2009,
this afternoon’s Centenary Novices’ Chase so is a decent each-way bet at a general Quevega is going for
(5.15pm), is his best chance of a winner at 10/1. her third straight win
the meeting. Ferdy Murphy runs Poker De Sivola who in the David Nicholson
Murphy has had just 18 winners this wouldn’t be without a chance judged on Mares’ Hurdle
season which is a very poor return for a his win in the four-miler at last year’s
trainer of his calibre, but that means a Festival. However, the trainer has said
number of his horses are very well handi- that this is firmly a stepping stone to the
capped. Divers has always been a favourite Scottish National and I don’t like backing
of his and was only beaten a neck by the horses in this race who haven’t experi-
decent Ashkazar in a handicap hurdle at enced the unique course.
Cheltenham last April. He was always Willie Mullins is bringing a very strong
going to make a better chaser and he team over to Prestbury Park this year and
could be thrown in off a mark of 132 here. his best chance of a winner could well be
There are a whole host of other chal- QUEVEGA in the David Nicholson Mares’
lengers and the two biggest dangers in my Hurdle (4.40pm). An infrequent visitor to
book are On Borrowed Wings and the racecourse, the seven-year-old mare
Tullamore Dew. The former ran a cracker has won the last two runnings of this race
to almost win a competitive handicap hugely impressively. She goes very well
hurdle at Ascot, while the latter was sec- fresh, Ruby Walsh will be in the saddle
ond at 80/1 in last year’s Coral Cup and and it will be a big surprise if the Irish
would have to go close judged on his sec- banker of the day gets turned over.
ond to Medermit at Plumpton in Sparky May is a clear danger, as she is
December. undefeated in four starts this season and
The Glenfarclas Cross Country Chase got the better of the decent yardstick
(4.00pm) isn’t one for the purists, but it is Carole’s Legacy at Ascot last time. She’d
certainly some spectacle and the only have to be pretty good to beat Quevega,
place to start is with ‘King of the Banks’ though, and I’m a little concerned that
Enda Bolger. In the race’s six year history, her trainer Patrick Rodford doesn’t have
he has won it four times, all for JP that many runners. The stable have had a
McManus-owned horses, and dual winner good season, but this is a big step up for
Garde Champetre will be back with stable- Sparky May and I reckon she’ll be playing
mate L’Ami. However, they aren’t getting for second place.
any younger and have to carry an awful
lot of weight. POINTERS...
Ireland have won all six renewals and A NEW STORY e/w Cheltenham 4.00pm
although there has been money for
Maljimar over the past week, I think it QUEVEGA Cheltenham 4.40pm
will stay in the Emerald Isle. A NEW DIVERS e/w Cheltenham 5.15pm
Sport
28 CITYA.M. 15 MARCH 2011
WORDS BY
HARRIET DENNYS
T Board has
ODAY marks the start of the
Cheltenham Festival – the jewel in
the crown of the jump racing calen-
dar and one of the biggest days of proposed”
the year for Simon Bazalgette, chief execu-
tive of the Jockey Club, which owns and
runs the sporting event.
Over the four days until the festival
reaches its climax with the Cheltenham
Gold Cup on Friday, about 250,000 pun-
ters are expected to pass through the race-
course turnstiles, “hundreds of millions of
pounds” will be spent on sporting bets,
and the sleepy county of Gloucestershire
will receive a projected positive economic
impact of £50m.
As Bazalgette points out, Cheltenham is
just one of many sporting fixtures that
contribute to the health of the UK racing
industry, which is the second biggest
sports employer in the country, after foot-
ball, and the second biggest sports contrib-
utor to GDP.
In other words, horseracing is big busi-
ness, which is why Bazalgette and his
Board members, known appropriately as
stewards, run the Jockey Club as a Plc to
support the racing industry, with all the
profits generated by the company reinvest- of its revenue through marketing, media Simon Bazalgette is shore, they can avoid paying the Levy and fair for the taxpayer and fair for racing,”
ed in the sport. rights and hospitality. diversifying the gross profits tax. And if bookmakers are says Bazalgette. “Our preferred outcome is
In 2009, the Jockey Club posted a The recent diversification into confer- Jockey Club’s com- operating offshore, one of the big issues is that the Tote stays independent under a
turnover of £99.9m and operating profits ences, outdoor concerts and exhibitions mercial interests that consumers won’t bet with them structure that would give the taxpayer
of £17.2m, down slightly from 2008’s should also be noted, bringing in a small because they don’t have consumer protec- some money, as the charitable trust pro-
turnover of £100.9m, and Bazalgette but “steadily growing” 10 to 15 per cent of Picture: tion under UK law. People need to know posal by the Tote Board has put forward.”
expects the financial results for 2010 to be that total, through ventures such as the Micha Theiner they won’t be taken advantage of.” As the legal battle with the bookmakers
roughly flat year on year. weekly antiques fair at Kempton. /City A.M. Fortuitously for racing, the Department over Turf TV – The Jockey Club’s most
Total prize money for the sport reached The biggest project on the horizon at for Culture, Media and Sport is working valuable media rights, through its 25 per
£41.3m in 2009, of which The Jockey Club the Jockey Club is the British Champion on a new licensing regime to bring errant cent stake in the venture – fades into his-
contributed 30 per cent, or £12.4m. Series, a joint venture with The bookmakers “back into the net”, and cul- tory, Bazalgette can focus on “optimising”
The Jockey Club raises money through Horsemen’s Group and racecourses that ture minister Jeremy Hunt has already the media deals with the BBC and
its four commercial divisions: the land will launch to the racing public through stipulated The Jockey Club must receive Channel 4 and doing what he loves best –
management arm Jockey Club Estates, “the biggest marketing campaign in between £74m and £81m for 2011/12. getting the nation as passionate about the
thoroughbred breeding business the British racing to date” in mid-April. Meanwhile, the debate over whether sport of horseracing as he is.
National Stud, industry charity Racing The aim of the series is to boost the pop- the pool betting quango the Tote should He tells the anecdote with pride of how
Welfare, and Jockey Club Racecourses, ularity of the flat-racing season, spanning move to ownership by a new trust called last Tuesday, the Tote Jackpot of £1.4m
which oversees the operation of a portfo- from the Guineas at Newmarket to a new the Tote Foundation, or by one of four bid- was won by Steve Whiteley, a heating engi-
lio of 14 racecourses and joint venture day at Ascot in October, to be called British ders, rumoured to be Gala Coral, Reuben neer from North Tawton in Devon, who
Jockey Club Catering. Champions Day, which will extend the Brothers, Sir Martin Broughton and went racing through a local promotion
The racecourses arm is by far the flat-racing calendar by five races. Betfred. The Jockey Club takes £11m per organised by the Jockey Club.
biggest moneyspinner for the business, Broadcast rights for the finale’s five year from the Tote’s profits and £9m per “This is a guy who took a free bus to
contributing between 80 and 90 per cent races have been bought by the BBC – year from its contribution to the Levy and, Exeter racecourse and won £1.4m with a
although Bazalgette refuses to reveal for unsurprisingly, Bazalgette wants to see £2 stake,” Bazalgette says.
how much – giving the Corporation the that revenue protected. Refreshing to see that even a man who
CV | SIMON BAZALGETTE media rights to 16 of the season’s flat “The racing industry is working with owns a stake in seven racehorses has an
races, with Channel 4 broadcasting the the government to find a solution that is egalitarian approach to the Sport of Kings.
remaining 19.
2008 to present: Chief executive, the The headline sponsor for the British FACT | HOW MUCH MONEY DOES CHELTENHAM MAKE?
Jockey Club and chair of Jockey Club Champions Series will be announced in
Racecourses. the next two weeks – although again,
Bazalgette will not yet reveal which firms
are bidding or for how much. Betting: About £600m is staked on the outcome of the worth more than £250,000. Sponsors range from
2004: Executive chairman of Racing UK The “most critical” issue for securing festival’s 26 races. In 2010, punters drew almost £1.4m bookmakers to financial services, construction, bever-
and chairman of Racecourse Media the commercial future of racing is mod- from the site’s 20 cash points. age and media companies.
Services. ernising the Levy, the rights fee paid by
bookmakers in return for making an Ticket sales: Total gate receipts net an estimated £7m. Prize money: The total prize money for 2011 is £3.4m,
1993: Joins Music Choice, rising to chief income from the sport, following the rise an average of £125,000 per race. About half this
executive of Music Choice Europe by 1999 of “loopholes” such as betting firms mov- Hotels and B&Bs: About 10,000 beds are filled during total comes from the races’ sponsors, with prize
and leading its 2000 flotation. ing offshore to pay less tax on their prof- the festival week, ranging from four-star hotels to local money for the Totesport Cheltenham Gold Cup at
its. In the year to 31 March 2008, the Levy B&Bs. The value to the local Gloucestershire economy £500,000 and prize money for the Stan James
1984: Qualifies as a chartered accountant paid £155m to the Jockey Club; over the is estimated at £50m. Champion Hurdle at £370,000.
at KPMG, rising to become managing same period for this year, the company
director of the company’s media consult- will receive just £60m to £65m. Sponsorship: Overall sponsorship money raised by the Broadcast rights: The broadcast rights are owned by
ing department. “The legislation was drafted in different festival is £1.8m, with the main sponsorship deals all Racecourse Media Group with Channel 4.
days,” says Bazalgette. “If bookies go off-
CITYA.M. 15 MARCH 2011 29
T
HE ticket application process for tered you are committed to paying, affected Group A clash at Kandy.
the London 2012 Olympic assuming you are allocated a ticket.
Games finally opens today, and For this reason, setting a budget is
they are sure to be hot property
so City A.M. has put together an easy
guide designed to make the process as
also worth considering. Some 2.5m
tickets will cost less than £20, while 90
per cent will be under £100.
Results
easy as possible.
3. TWO WAYS TO APPLY =FFK98CC
1. IT’S NOT FIRST COME, FIRST SERVED The quickest way to apply for tickets is EGFN<I:?8DG@FEJ?@G
While the application process opens by visiting the official website Jessica Ennis is hoping for 2012 gold in the heptathlon on 4 August Picture: REUTERS Efin`Z_%%%%%%%%%%%%%%%%%%%( * 9i`jkfc:`kp%%%%%%%%%%%%%%%%%%' (
today, it lasts for six weeks (until (www.tickets.london2012.com), where ?fck)g\e #CXejYlip/0 8[fdX_-,
JlidXe0' 8kk1)+#+)/
11:59pm on 26 April), and only then you will need a valid email address
will tickets be allocated. It is not a case and a Visa debit or credit card.
KEY DATES | LONDON 2012 :I@:B<K
of first come, first served; if events are Applications can also be made by post @::NFIC;:LG$>IFLG81Q`dYXYn\mGXb`jkXeBXe[p 1
Athletics Usain Bolt defends 100m title on 5 Diving Prodigy Tom Daley’s big days at the Q`dYXYn\(,($.:I<im`e\,) mGXb`jkXe(-+$*8J_X]`h
oversubscribed then all those who using forms available from branches ./ef %GXb`jkXe)gkj Y\XkQ`dYXYn\Yp.nbkj%>IFLG91
apply will go into a ballot after the of Lloyds TSB, with payments made by August, when Chrisitine Ohuruogu goes for Aquatics Centre are 30 July (10m synchro plat-
?fccXe[m9Xe^cX[\j_:_`kkX^fe^ 1?fccXe[(-'IEk\e
closing date. All payments will be Visa card, cheque or postal order. 400m gold. Other home hopefuls Jessica Ennis form) and 11 Aug (individual 10m platform) ;f\jZ_Xk\,*ef m9Xe^cX[\j_(--$+@BXp\j.*ef %
taken after 10 May and successful (heptathlon) and Phillips Idowu (triple jump) Football Wembley hosts men’s and women’s 9Xe^cX[\j_)gkj Y\Xk?fccXe[Yp-nbkj%
applicants will be notified by 24 June. 4. CORPORATE HOSPITALITY take centre stage on 4 and 9 Aug finals on 9 and 11 Aug
The only official channels for travel KF;8PËJ;@8IP
2. PLAN APPLICATIONS CAREFULLY and hospitality are Thomas Cook, Cycling Team sprint and pursuit events on 3 Tennis Andy Murray will be hoping to be in the
L<=8:_Xdg`fejC^\(jkBefZb$FlkIe[)e[C\^
Customers can apply for a maximum Prestige Ticketing and Jet Set Sports – and 4 Aug; Sir Chris Hoy in men’s sprint on 6 men’s singles final on 5 Aug 9Xp\ieDle`Z_( m@ek\iD`cXe' %%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%.%+,
of 20 sessions, but be warned: only apart from football at Wembley, Aug and Victoria Pendleton in keirin on 7 Aug Rowing GB duo Zac Purchase and Mark Hunter DXeLk[' mDXij\`cc\' %%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%.%+,
apply for events you will definitely which is being sold by the stadium Swimming Rebecca Adlington will go for 400m go for lightweight dohble sculls on 4 Aug
intend to go to and can afford to pay operators themselves – so beware of and 800m freestyle titles on 29 July and 3 Aug Gymnastics Beth Tweddle in uneven bars 6 Aug
for. Once applications have been regis- fraudsters claiming to offer tickets. email sport@cityam.com
30 Sport CITYA.M. 15 MARCH 2011
Fergie banks
on Euro
know how
Hamilton won the 2008 title Pic: GETTY
Hamilton
latest star in
Fuller stable United boss insists his
side can handle the
pressure as the run-in
▲
FORMULA ONE
BY FRANK DALLERES begins to heat up
BRITISH former world champion
Lewis Hamilton has joined global
superstars David Beckham, the Spice
Girls and Sir Michael Caine in signing
up to be managed by showbiz mogul MANCHESTER UTD
and Pop Idol creator Simon Fuller.
Hamilton, who is paid £10m a year
by team McLaren, has agreed to be MARSEILLE
represented by Fuller’s company XIX
Entertainment, which also boasts ten-
▲
HISTORY LESSONS
A goalless draw away from home in the first
Tindall expected to be ruled
leg is often regarded as a dangerous scoreline
and United have shown on occasion in the past
why that’s the case. Moreover, even when
they’ve managed to grab an away goal they
out of Grand Slam decider
haven’t always progressed.
Tindall, a veteran of England’s last
▲
RUGBY UNION Grand Slam campaign back in 2003, will
BY JAMES GOLDMAN be assessed further by England medics
when the squad reconvenes at Pennyhill
ENGLAND captain Mike Tindall is today Park today.
expected to be ruled of his side’s Grand If Tindall is, as expected, ruled out of
Slam decider against Ireland on the Dublin clash, Nick Easter would be
Saturday. the leading candidate to captain
Tindall has led Martin Johnson’s side England.
to four consecutive victories in this year’s But England could face a further prob-
1998: United came through unscathed on a RBS 6 Nations in the absence of lem if Banahan is cited for the way
concrete surface in Monaco but their defences Lewis Moody, whose knee ligament he flattened Scotland No8 Kelly
were breached by a David Trezeguet thunder- injury paved the way for the Brown with his forearm.
bolt early in the return leg. Ole Gunnar World Cup winner to captain the Scotland’s head coach Andy
Solskjaer equalised in the second half but Sir team for the first time. Robinson said he will study the
Alex Ferguson’s side exited on away goals. The 32-year-old (right), who was video to see if Banahan had illegal-
winning his 70th cap, injured his ly used his forearm on Brown who
Lehmann fell out with current Arsenal keeper Almunia Picture: REUTERS left ankle in Sunday’s scrappy 22- was carried off with a head injury,
16 victory over Scotland and though he later recovered
was replaced at half- and may face Italy on
protective boot to
undergo x-rays.
quently banned,
England will be
looking for yet
another option
at centre.
Bernabeu but he was beaten by his own cap-
tain, Roy Keane, early in the return. A Raul
▲
brace stretched Real’s advantage and ren- FOOTBALL Spaniard said in April 2008: “I
dered two late consolation goals irrelevant. BY FRANK DALLERES know he hates me.”
Lehmann’s return risks reopen-
ARSENAL manager Arsene ing old wounds at a time when
Wenger has risked dressing-room Almunia is already fragile, having
unrest by calling on the com- been dropped and then shunned
bustible veteran former Gunners for months but now reinstated
goalkeeper Jens Lehmann to solve following injuries to Lukasz
his injury crisis. Fabianski and Wojciech Szczesny.
Lehmann, 41, is set to come out Arsenal, who can sign
of retirement and rejoin the Lehmann outside the transfer
north London club on a short- window because he is a free
2004: A Benni McCarthy brace turned the term deal as backup to Manuel agent, held talks with him yester-
first leg in Porto on its head, but Paul Scholes’ Almunia, their only fit senior day and hope to complete his
goal in the return looked to be sending United stopper, in one of the most unex- signing before Saturday’s trip to
through, only for Costinha’s last gasp effort to pected moves of the season. West Brom.
send Ferguson’s side crashing out and spark The German hung up his
an infamous touchline jig from Jose Mourinho. gloves last summer, two years HIGHS AND LOWS | LEHMANN
after leaving Arsenal, where he
helped the so-called Invincibles 1988 Makes debut for Schalke
win the 2003-04 Premier League
title without losing a match. 1997 Shootout hero in Uefa Cup final
But while eccentric Lehmann 1998 Begins ill-fated spell at AC Milan
has undoubted pedigree, he noto- 1999 Returns to homeland with Borussia
riously fell out with Almunia, the Dortmund, wins Bundesliga in 2001-02
understudy who ultimately
replaced him, to his chagrin.
2003 Joins Arsenal and plays every game
Lehmann described it as a of Invincibles season, also wins 2005 FA
“humiliation” when he lost the Cup but is dropped in 2007-08
No1 spot to Almunia early in the 2008 Joins Stuttgart, retires in 2010
2007-08 season, while the
T
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up for the Supreme Novices’ forgotten horse is Dunguib and at
Hurdle the crowd erupts – and double figure odds he’s also worth a
we’re off. Cue Card is the hot look each way.
favourite and if he wins Paddy Power
will be refunding losing bets on any
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