cityam 2011-08-19

8/6/2019 Cityam 2011-08-19

1/24

ITS WHAT HAPPENS WHEN CRICKET MEETS GLADIATORS

THE ULTIMATE TEST OF CRICKETING SKILLS - Dont miss it!

go to www.titansofcricket.com THE O2 8th of OCTOBER

SEHWAGHARMISONGILCHRISTUTHAPPA

GILLESPIETRESCOTHICK

CHAWLA

and MORE

FLINTOFFBOONAKRAMSREESANTHAFRIDICOLLINGWOODMAHMOOD

RAZZAQ

LOVECRICKET?WWW.TITANSOFCRICKET.COMDONT MISSIT!

FTSE 100 5,092.23 -239.37 DOW 10,990.58 -419.63 NASDAQ 2,380.43 -131.05 /$ 1.65 unc / 1.15 unc /$ 1.43-0.01

HEWLETT-PACKARD is buying theUKs most valuable software compa-ny Autonomy for $10.2bn (6.2bn),in the latest takeover of a majorBritish company by an Americanfirm.

The deal was announced lastnight as HP unveiled its third quar-ter earnings and is part of a massiveshake-up at the US computing giant,which is also exploring a spin-off itsstruggling PC business.

Chief executive Leo Apotheker, who recently joined from Germanrival SAP, said bringing Autonomyinto the HP world will be seamlessand highly complementary. Heexpects to complete the acquisitionby the end of the calendar year.

We are building a strong HP software business... The acquisition of Autonomy will build on thatmomentum and accelerate our soft-ware strategy, he said.

Autonomy has recommended theall-cash deal to its shareholders. Itsfounder and chief executive MikeLynch, who will continue to headup the company, still owns 8.2 percent of the firm and stands to makearound $820m.

Autonomys intelligent softwareis designed to make sense of humanconversation. It allows companies tosearch huge audio and video data- bases such as phone logs andquickly retrieve relevant informa-tion.

The software was used in therecent case against French roguetrader Jrme Kerviel, of Socit

Gnrale, where it analysed thou-sands of hours of taped phone con-

BY STEVE DINNEEN ANDKASMIRA JEFFORD

TECHNOLOGY

www.cityam.comIssue 1,450 Friday 19 August 2011 FREEBUSINESS WITH PERSONALITY

versation and selected the mostimportant extracts.

The bid will also come as a person-al validation for Lynch, who used tocarry a card in his pocket readingits different over here to brandishevery time he was spoken down toby his US counterparts.

Since then Autonomy has flour-ished in North America, establishinga joint head quarters in San

Fransisco and boasting Coca-Colaand the SEC among its clients.

Before the bid was announcedafter the bell in the US, Autonomyclosed down in London by 8.3 percent with a market cap of $5.7bn,meaning HP is offering a premiumof almost fifty per cent.

HP has struggled against intensecompetition from Dell and Apple inthe laptop and desktop markets andits latest tablet offering has failed toset the market alight.

As part of its overhaul, HPannounced plans to axe its tablets

and smartphone business, after itsproducts failed to gain traction inthe market.

The company, which lowered itsfourth quarter guidance for thethird time this year, reported dilutedearnings per share of 93 cents onrevenue of $31.19bn, compared with75 cents and $30.7bn a year earlier.

The challenges and the transfor-mation we are undertaking will take

several quarters to fully resolve,Apotheker said.

Certified Distribution

04/07/2011 till 31/07/2011 is 93,093

HP TO PAY 6BNFOR AUTONOMY

Markets inmeltdownas globalfears grow

STOCKS nose-dived in the openingminutes of trading in Japan this morn-ing, mirroring another disastrous day

for markets in Europe and the US yes-terday.

The Nikkei lost over two per cent ininitial trades, dropping to 8,756.Earlier in the month the index hit alow of 8,656.

The FTSE suffered its biggest fall inover two years yesterday, losing 4.5 percent to end the day perilously close tothe 5,000 mark, at 5,092.23.

After economists at Morgan Stanleysaid the US and Eurozone are danger-ously close to recession, stocks in theUS also collapsed. The Dow Jonesindustrial average fell 3.68 per cent, while the Nasdaq slumped even fur-ther, closing down 5.22 per cent.

As investors fled equities, the New

York Stock Exchange and NYSE AmexCash Markets invoked the rarely-usedRule 48 rule to smooth trading at theopen.

Banks were among the worst-hitstocks on both sides of the pond, withdouble-digit percentage losses atBarclays, which fell 11.5 per cent andRBS, which tumbled 11.3 per cent. OnWall Street, Citigroup lost 6.3 per centand Morgan Stanley shed 4.8 per cent.

Meanwhile, it emerged that someEuropean banks are being forced topay more for access to short-term USdollar loans as fresh fears surface overthe Eurozone fiscal crisis spreadingthrough the financial sector.

The Federal Reserve is taking a clos-er look at the US units of Europes

biggest banks on worries that theregions debt crisis could spread to theUS banking system, the Wall StreetJournal reported.

BY JULIAN HARRISWORLD ECONOMY

The amountwiped offBritains blue

chip companiesyesterday

Autonomy founder and chiefexecutive Mike Lynchs stakeis worth an estimated $820m

Picture: Micha TheinerCity AM

62bn

8/6/2019 Cityam 2011-08-19

2/24

SHOCKINGLY negative economicdata rattled markets in New York yes-terday, adding to an ultra-bearish

day for equities.Claims for US unemployment ben-efits rose; home sales dropped; infla-tion picked up; and a Philadelphiafactory index collapsed to worsethan a two year low.

The gauge of factory activity in theMid-Atlantic region fell off a cliff,printing minus 30.7 in the index for

August, from a positive reading of3.2 in July. Economists had expecteda reading in positive territory.

There are lots of phrases youcould use to describe the figures,none of them printable, said DrewMatus of UBS. It was a very weakreport.

Throughout the US, the number

of people joining the dole queuerose by 9,000 to a seasonally adjusted408,000. In the week ending 13

August, 7.34m Americans wereclaiming unemployment benefit.

The ailing US housing market alsoappears to be stuck in the mud, withexisting home sales unexpectedlyfalling by 3.5 per cent in July, com-pared to June considerably worsethan expectations.

And despite the apparent econom-

ic downturn, prices spiked in July,with the consumer price index (CPI)rising 0.5 per cent compared to theprevious month.

The annual rate of inflation (CPI)held up at 3.6 per cent. Strong price

pressures could prevent the FederalReserve from engaging in a furtherround of quantitative easing untilearly next year, Capital Economicssaid in a note.

Meanwhile, weak economicprospects throughout the worldhave seen American mortgage ratestumble to historic lows, as investorsturn to bonds that guide loans forhouse purchase, the state-backedlender Freddie Mac said yesterday.

News2 CITYA.M. 19 AUGUST 2011

EDITORS LETTER

DAVID CROW

There is nothing sobad that politicians

cant make it worse

IT was Thomas Sowell, the Americaneconomist, who said there is noth-ing so bad that politics cannot makeit worse. In recent weeks, politicianshave tested that maxim to destruc-tion. From horse-trading over the USdebt ceiling to cack-handed policy-

making in Europe, almost every polit-ical intervention has served only tofan existing fears over the globalrecovery.

As they downgraded their globalgrowth forecasts yesterday, analysts atMorgan Stanley blamed Europesslow and insufficient response to thesovereign debt crisis and the dramaaround lifting the US debt ceiling foran erosion in business and consumerconfidence. At every turn, politicianshave poured fuel on the flames.

Yesterday, it was the effect of theshort-selling ban in four Europeancountries that exacerbated the sell-offin equities. Traders who were unableto hedge against a variety of long posi-tions decided to sell out of thosestocks instead, causing liquidity todry up.

Clearly politicians and regulatorshavent learnt anything from the del-uge of evidence that shows short-sell-ing bore no responsibility for the lastfinancial crisis, nor the fact that the2008 ban did nothing to stop bankstocks plummeting. It is as if policy-makers are watching an action replayin the hope that the finale will some-how play out differently.

Plans for a Tobin tax on all transac-

Editorial StatementThis newspaper adheres to the system of

self-regulation overseen by the Press ComplaintsCommission. The PCC takes complaints about theeditorial content of publications under the EditorsCode of Practice, a copy of which can be found atwww.pcc.org.uk

Printed by Newsfax International,

Beam Reach 5 Business Park,Marsh Way, Rainham, Essex, RM13 8RS

Distribution helplineIf you have any comments about the distributionof City A.M. Please ring 0207 015 1230, or [email protected]

4th Floor, 33 Queen Street, London, EC4R 1BRTel: 020 3201 8900 Fax: 020 7283 5334Email: [email protected] www.cityam.com

EditorialEditor Allister HeathDeputy Editor David HellierNews Editor David Crow

Acting Night Editor Marion DakersBusiness Features Editor Marc SidwellLifestyle Editor Zoe StrimpelSports Editor Frank DalleresArt Director Craig GaymerPictures Alice HeppleCommercialSales Director Jeremy SlatteryCommercial Director Harry OwenHead of Distribution Nick Owen

tions in the European Union, backedby France and Germany, weighed onfinancial stocks earlier in the week.Markets had hoped that NicolasSarkozy and Angela Merkel wouldoutline a way of dealing with the sov-ereign debt crisis; it beggars beliefthat the best they could come up

with was a spiteful 200bn tax thatonly served to push sentiment evenlower.

The irony is that markets needpoliticians now more than ever,

because Europe has to find a way ofsolving the debt crisis. One can debatethe pros and cons of the various solu-tions an orderly break-up of theeuro, fiscal integration of theEurozone or bigger bailout funds

but one cant ignore them.As the financial turmoil unfolded,

Britains leaders were sunning them-selves in Tuscany and Los Angeles. Ittook the worst rioting in a generationto force them to return, and eventhen only after the worst was over.

When the country was in crisis, therewas a vacuum at the top.

Politicians across the pond arehardly setting an example. The dis-graceful stand-off over the debt-ceil-ing, and the messy compromise anddowngrade that followed, set the tonefor a truly awful August.

As the Democrats and the GrandOld Party squabbled, China

Americas biggest creditor flexed itsmuscles, issuing a hectoring state-ment through state-owned newsagency Xinhua.

The US government has to come toterms with the painful fact that thegood old days when it could just bor-row its way out of messes of its ownmaking are finally gone, it said.

When the only people talkingsense are Chinese propagandists, its asure sign that things are not as theyshould [email protected] Heath is away

-4.49%

Gloomy American datafuels recovery doubtsBY JULIAN HARRIS

US ECONOMY

MORE fears about the global econo-my drove prices of safe-haven US gov-ernment bonds up yesterday, as both

US and UK yields fell.Ten-year US Treasury yields dipped

below two per cent during the day asnegative data provoked a frenzy of

buying.Benchmark 10-year note yields

touched 1.97 per cent, while 30-year

bond yields also plunged as low as3.34 per cent, the lowest since

January 2009.Some analysts yesterday estimated

that US 10-years could drop as low as1.75 per cent in the coming weeks.

UK 10-year gilt yields sank below 2.3

per cent, with the yields on German10-year bunds under 2.1 per cent.

Dart to safe havens sees yields drop to fresh lowsECONOMY

TRADERS PREPARE FOR CHVEZ GOLDTRANSFERBullion traders are preparing for oneof the largest transfers of physicalgold in recent history after Hugo

Chvez, Venezuelas president,ordered the countrys gold reserves tobe returned to Caracas.

WHAT THE OTHER PAPERSSAY THIS MORNING

GADDAFI TURNS TO ILFORD LAW FIRMTO UNLOCK HIS FROZEN ASSETSColonel Gaddafis regime has turnedto a law firm in East London in anattempt to regain control of its frozen

assets. Small high street practiceEdwards Duthie has been instructed.

EXXONMOBIL SUES US GOVERNMENTOVER SEIZURE OF OIL LEASESOil major ExxonMobil is suing the USgovernment for cancelling some of itsdeepwater exploration permits in theGulf of Mexico. US authorities tookaway three out of five of Exxon's leasesfor the Julia field.

Equities plunge

Oil drops oneconomicworries

CRUDE

OIL

4.82%

UK banks feel the pain..

ANALYSIS l Gold Future

Mar Apr May Jun Jul Aug

1,700

1,600

1,800

1,500

1,400

1824.5018 Aug

Dollarsperounce

ANALYSIS l Silver Future

Dollarsperounce

18 Aug17 Aug16 Aug15 Aug12 Aug

40.8000

39.8000

38.8000

40.6518 Aug

-6.94%

-11.31

Fear index surges

Jun Jul Aug

16

18

20

22

26

28

30

32

34

36

38

40

42

44

46

24

43.5618 Aug

FTSE

100

EUROSTOXX

50

DOWJONESindustrial average

-5.34%

-3.68%

Safe haven preciousmetals surgeGold soars to fresh record high

of almost $1,825 an ounce-11.47

-9.25

VIXindex jumps

38%

FEAR RETURNS TO STALK MARKETS

8/6/2019 Cityam 2011-08-19

3/24

News 3CITYA.M. 19 AUGUST 2011

FRANCES financial regulator had torush out an amendment to its shortselling ban yesterday after traderscomplained it had stopped themshorting European stock indexfutures.

Amid another round of panic sell-ing on European stock markets,traders said the ban left themunable to short futures on the

Eurostoxx 50 index, which includesFrench banks Societe Generale, BNP

Paribas and Credit Agricole. The Autorit des Marchs

Financiers put out a clarificationafter markets closed to allow anyone

with a short position on a bank stockor related derivative to continue it

by buying new options to replaceexpiring ones.

Traders warned that the shorting ban in Italy, France, Spain andBelgium could raise volatility andcut liquidity on stock markets acrossEurope as investors are less able to

hedge long positions with short oneson the affected stocks.

Confusion reignsover a short banBYALISON LOCK

CAPITAL MARKETS

SEVERAL European countries aredemanding collateral on bailoutloans they provide to Greece, after itemerged that Finland had secured acommitment earlier this week.

Austria, the Netherlands andSlovakia added their voices to thedemand for collateral to secure theircommitments to Greece via theEuropean Financial Stability Facility,

despite senior Greek government

sources saying no discussions hadtaken place with countries otherthan Finland.

If there is to be a model for collat-eral, Austria would also make aclaim, a spokesman for the countrysfinance ministry said.

But other Eurozone countries have been quick to criticise the idea ofdemanding collateral, amid fears itcould undermine the bailout agree-ment made last month, which pro-

vides 109bn (95bn) in emergency

funding through the EFSF.Francois Cabau, an economist atBarclays Capital, said Finlands insis-tence on collateral could threaten theprocess.

By agreeing to [collateral] ... youactually do the opposite of what youoriginally set out to do, withdrawingcash from ... somewhere that doesnthave any, he said. This is likely toprovoke some annoying politicalnoise in the market.

European countries demandcollateral for loans to GreeceBY ELIZABETH FOURNIER

EUROZONE CRISIS

Europe and US follow suit

vestors pile into Treasuries and Gilts

Yield on Greek10yr bonds

14.73%

Yield on Spanish10yr bonds

4.68% Yield on US10yr Treasuries

2.09%

Yield on UK10yr Gilts

2.29%

THE US department of justice is inves-tigating the ratings that Standard &Poors gave to dozens of mortgages inthe run up to the financial crisis,amid concerns pressure was put onanalysts to hike the ratings.

Though the investigation is said tohave been underway since before therating agency downgraded US debt

from AAA to AA+ earlier this month,news of the probe has sparked talk ofa government backlash against S&P so far the only agency to change itsUS outlook.

The enquiry hinges on whetheranalysts ratings of mortgage-basedloans were influenced or overruled

by business managers within theagency.

US announces probe into S&PEUROZONE

-7.41

-9.26%

-4.08%

-6.26%

-4.76%

-6.03%

8/6/2019 Cityam 2011-08-19

4/24

8/6/2019 Cityam 2011-08-19

5/24

Stanley Gibbons (Guernsey) Ltd18 Le Bordage, St. Peter Port, GY1 1DETelephone: 0845 026 7170Email: [email protected]

Do you want

100% capital security?

the potential to earn unlimited returns

- historically 10% per annum?

If you answer YES to all the above then

call us on 0845 026 7170 or visitstanleygibbons.com/ADCAfor afree 16 page report.

Invest in a surprising asset class with strong

historical returns. Contact us today.

Stamps and certain other collectibles are not designated investments or the purposes o the Financial Services and Markets Act 2000 (Regulated Activities)Order 2001 and as such are not subject to regulation by the Financial Services Authority (FSA) or otherwise. Stamps and certain other collectibles are not Con-trolled Investments or the purposes o the Protection o Investors (Bailiwick o Guernsey) Law, 1987 (as amended) and as such are not subject to regulationby the Guernsey Financial Services Authority (GFSC). However Stanley Gibbons (Guernsey) Limited has registered with the GFSC under the Registration oNon-Regulated Financial Services Businesses (Bailiwick o Guernsey) Law, 2008 (as amended) as a fnancial services business and thereore is regulated by the

GFSC in respect o Anti-Money Laundering and Countering Financial Crime and Terrorist Financing matters.

THE WEAKNESS of the UKs con-sumer recovery was underscored yes-terday, after official figures revealedretail sales rose by just 0.2 per centin July.

Clothing sales were particularly weak as cash-strapped householdsreined in their spending, the figuresfrom the Office for NationalStatistics (ONS) showed. Analysts hadpencilled in a 0.3 per cent rise com-pared to a month ago, after retailsales grew 0.8 per cent in June.

Consumer spending is being hit bythe worst squeeze on take-home payin recent times. Earlier this week,the Bank of England said consumerprice inflation jumped to 4.4 per

cent in July and is likely to rise fur-ther still.Nomura analyst Philip Rush said:

With large utility price hikes beingimplemented between August andOctober, the squeeze on householdbudgets still has further to run. Poorconfidence, exacerbated by globalpressures, is also likely to urgespending restraint by households.

The ONS said volume sales ofclothing and footwear fell 0.3 percent in July with household goodsdeclining by the same amount. Foodsales were up 0.7 per cent.

Since the start of the year a number of well-known retailers havegone into administration, includingfashion chain Jane Norman, interiordesigner Habitat and wine sellerOddbins.

Stephen Roberston, director of theBritish Retail Consortium, said:This confirms the painful picturepainted by our own figures last

week. Conditions are increasinglydifficult for customers and retailers.CINEWORLD CHEERS POTTER: P12

High inflationhits UK retailsales in JulyBY JOHN DUNNE

RETAIL

PRIVATE investigator Glenn Mulcaireis to sue Rupert Murdochs News Corpafter it stopped paying his legal feesover the phone hacking scandal.

Murdoch told a parliamentaryselect committee last month he would cease the payments, whichhave so far exceeded 246,000.

Mulcaire claims the organisationhas a contractual obligation to pay

the legal bills.Meanwhile the News of the Worlds

former Hollywood reporter JamesDesborough has been arrested onsuspicion of conspiring to interceptcommunications.

He is the 13th journalist arrestedand the first based in the US,although it is understood the chargesrelate to before he left the UK.

Desborough wrote for the News ofthe World until it closed last month.

Private investigator Mulcaire tosue News Corp over legal fees

MEDIA

RUSSIAS largest sports equipmentand clothes retailer Sportmaster isconsidering an initial public of feringin London next year, financial marketsources said yesterday.

Sportmaster could attract up to$700m (424m) in the IPO based onits own valuation of between $2.5bnand $3bn, the sources said, adding

the retailer has not yet picked organ-isers for the issue.The group is set to unveil revenues

of $1.3bn for the year to the end of August, according to forecasts byRenaissance Capital, and report earn-ings before taxes, interest payments,depreciation and amortisation of$306m.

Sportmasters plans are beingformed at a time of turbulent finan-cial markets not suited to floats, as

investors rush to exit risky assetsincluding Russian equities. Just yesterday, market turmoil

prompted fellow Russian retailerCentrobuv to rule out an IPO thisyear.

And the only scheduled float onthe US markets this week, onlinevideo company Tudeo on Wednesday,saw its shares sink almost 12 per centon the first day of trading as the f irmwas swept up in market turmoil.

Sportmaster looks to float inLondon in spite of turbulenceBYHARRY BANKS

CAPITAL MARKETS


US retailer Gap beat forecasts last night with second-quarter net income that fell lessthan expected to $189m, from $234m a year ago. Net sales rose two per cent to $3.39bn,

though same store sales fell two per cent. Profit margins also came in slightly aboveexpectations, at 36.9 per cent. Picture: Rex Features

GAP BEATS FORECASTS

8/6/2019 Cityam 2011-08-19

6/24

GLOBAL economic and social prob-lems could hit property broker Savills,its chief executive warned yesterday,despite seeing values for the best prop-erties hold up in London and Asia.

Jeremy Helsby shrugged off thecommercial impact of the recent riotson Savills and said the firm had wonnew work for London propertiesworth more than 5m. The capitalsprime market has strengthened, cre-ating a two-tier Britain, he added.

Speaking the week after riots devas-tated parts of London, Birminghamand Manchester, Helsby warned thatthe firm would not completely escapethe impact of the unrest, here or over-seas.

We currently see no materialchange in the outlook for our busi-ness although the potential effects ofthe current economic and social volatility are likely to have someimpact on both commercial and resi-dential transaction markets acrossour regions.

Values for the best property inHong Kong and Singapore were alsoresilient, the company said. Profitbefore tax for the six months to 30

June rose 39 per cent to 20m, whichmeant a 20 per cent rise to 20.6m onan underlying basis. Turnover rose byten per cent to 335.8m.

Analysts at Numis wrote: Savillsfirst half results are strong and aheadof expectations. However, we are leav-ing estimates unchanged to reflectthe uncertain outlook.

Yesterday the firm said fee incomeat Cordea Savills, its fund manage-ment arm, rose 25 per cent to 10.5m.

Savills employs around 20,000 peo-ple in 200 offices in more than 40countries.

It has long had a reputation forupmarket residential work and lastyear it enjoyed a 4m boost from mar-keting the Candy brothers One HydePark flats. PROPERTY: P16

THE COST of building schools andhospitals using the controversial pri-vate finance initiative (PFI) should beincluded on the governments bal-ance sheet, a group of influential MPswill say today.

In a highly critical report, the Treasury select committee will saythat PFI does not provide taxpayerswith good value for money and rec-ommend that tough new rules be

introduced to reduce the govern-ments reliance on the funding mech-

anism.Former chancellor Gordon Brownsigned off hundreds of public con-struction projects using PFI, whichallows the government to borrowfrom the private sector to financeschemes while keeping the liabilitiesoff of its books.

But the funding method hasproved incredibly costly, according toofficial figures. More than 900schemes have been completed with a

total capital value of 56bn yet theamount the taxpayer will have to

repay stands at 229bn and is rising.Andrew Tyrie MP, chairman of thecommittee, said: We cant carry onas we are, expecting the next genera-tion of taxpayers to pick up the tab.PFI should only be used where we canshow clear benefits for the taxpayer.

Despite dismissing PFI as discred-ited before the election, chancellorGeorge Osborne has backed over 60projects worth almost 7bn sinceentering the Treasury.

MPs slam private finance initiative andcall for liabilities to go on balance sheet

BANKS must overcome psychologicalscarring induced by the financial cri-sis and start taking more risk, a seniorBank of England off icial said yesterday.

Andrew Haldane said banks shouldpay smaller dividends to shareholdersin order to meet capital requirementswhile also increasing risk.

Yet he also suggested that capitalrequirements could be relaxed.

The Financial Policy Committee,like the Monetary Policy Committee,

needs to act ... in response to thesedevelopments, he said, referring to

the recent downturn. Its job is tocushion the fall as well as arrest therise in credit and debt.

Risk is likely to be over-priced dueto current market jitters, Haldanesaid, calling for action to the authorities to counter-act market sentiment.

Memories of financial disaster arenow fresh, as after the GreatDepression [of the 1930s], causing anover-estimation of the probability of arepeat disaster, said Haldane.

Banks should take morerisk, says Banks Haldane

UK ECONOMY

LONDON rent rises are outstrippingthose in the regions as frustrated would-be homebuyers turn to short-term sources of accommodation.

Rents in England and Wales rose forthe sixth month in a row in July withthe capital seeing the largest gains,according to the Buy-to-Let Index fromLSL Property Services, which is pub-lished today.

Average prices soared 7.1 per cent toa new high of 1,009 per month. Rents

rose 5.5 per cent in the north east and4.8 per cent in the east and west

Midlands. The average rent in England and

Wales rose 0.6 per cent to 705 permonth, following to the previous highof 701 in June.

The average rent is now 29 per cal-endar months higher than in July lastyear. The average yield reached 5.2 percent in July, up from 4.8 per cent a yearago.

David Newnes, estate agency man-aging director of LSL, which owns YourMove and Reeds Rains, said risingrents meant it was becoming harderfor first-time buyers to save deposits.

Rents are on an upward trajectory,and it is unlikely that tenants will gain

respite any time soon. Demand fromthousands of frustrated buyers eachmonth is underpinning buoyant com-petition for rental homes, enablinglandlords to increase prices.

This is the peak summer season, with more renters on the move, themarket will continue to heat up. Suchstrong demand and high rentalincomes has forced lenders to takenotice, and more are returning to thesector.

Competition in the buy-to-let mar-ket means the range of affordableproducts is expanding, he added.

Rents fell in the West Midlands,Yorkshire and the North West.

Rents in capital still soaringBY PETER EDWARDS

PROPERTY

London prices

help to boostSavills profitBY PETER EDWARDS

PROPERTY

BYDAVID CROW

POLITICS


ANALYSIS l Savills

p

16 Aug15 Aug12 Aug 17 Aug 18 Aug

330

320

314.1018 Aug

Five star: prices soar in London boroughs

31

24

5

Camden1

The borough best-known asthe birthplace of Britpopsaw average prices go from

532,243 in 2009 to663,426 in 2010 beforedipping to 623,936 thisyear.

Westminster2

Westminster remaineduntainted by its associationwith the manure parlia-ment as prices rose from746,050 in 2009 to781,438 in 2010 and866,777 this year.

Islington3

The spiritual home of New

Labour has enjoyed a pros-perity of which politicianscould only dream. Pricesrose from 386,726 in2009 to 452,832 in 2010and 471,405 this year.

Hammersmithand Fulham

4

The borough that serves asa home to technology giantSony Ericsson has seen asteady rise in prices from459,676 in 2009 to587,277 in 2010 and628,728 last year.

5

Prices in Roman

Abramovichs adoptedhome borough have stayedin seven figures: 1.03m in2009, rising to 1.12m in2010 and dipping slightly to1.09m this year.

Camden

Westminster

Hammersmith& Fulham

IslingtonKensington& Chelsea

Kensingtonand Chelsea

NEWS | IN BRIEF

Mortgage lending slows in UKThe rate of UK house-buying is set tofall again in the next few months,experts warned yesterday, after newdata showed the faltering recovery inUK mortgages ground to a halt in July.Bob Pannell, chief economist of theCouncil of Mortgage Lenders (CML),said Britain had been hit by theeffects of the sovereign debt crisis inthe Eurozone, which has slowed activi-ty in the wholesale funding markets.He warned that the market coulddrift lower in the coming months.He was speaking as CML figuresshowed gross mortgage lending inJuly hit 12.6bn, down a single per-centage point from 12.68bn in June

and six per cent below the 13.3bnrecorded in July last year.

CEBR: house values will riseHouse prices will rise by nearly a sixthby 2015, according to the Centre forEconomics and Business Research(CEBR). It forecast a 14 per cent riseby the middle of the decade with thedepressed rate of housebuilding lead-ing to an increasing shortage ofaccommodation. The level of homeownership is currently 68 per cent,compared to 71 per cent in 2000.Shehan Mohamed, CEBR economist,said an average of 110,000 homes willbe built each year, but 225,000 areneeded annually to meet changes inthe UK population and social make-up.Douglas McWilliams, CEBR chief exec-utive, said that while a return to the

housing boom is unlikely, shortagescould push prices gently upwards.

IT is not just Arab sheikhs andRussian oligarchs snapping up thebest of Londons residential property.Estate agency Marsh & Parsonsreceived interest from would-be buy-ers in 193 countries over the lastmonth, according to chief executivePeter Rollings.

The firms website had the most vis-its from potential investors from theUS, France, Italy, Germany, Spain,Australia, Ireland, Greece, Switzerland

and Hong Kong.Chinese buyers are typically looking

for small units in Kensington andKnightsbridge in which their adultchildren can live while studying atImperial College, Rollings added.

London remains an attractive desti-nation for overseas buyers, withRollings saying many investors still seeit as a safe haven for their assets.

Prices at 1 June averages. Source:LSL Property Services.

8/6/2019 Cityam 2011-08-19

7/24

8/6/2019 Cityam 2011-08-19

8/24

No deposit

- ever and

no interest

- ever

All finance is

free at dfs -

Its effortlessly

affordable

Credit subject to acceptance. Credit is provided by external finance companies as determined by DFS. 4 years free credit from date of order. Delivery charges apply. DFS may alter or extend promotions at any time.

Mobile charges may apply when calling 0800 110 5000. DFS is a division of DFS Trading Ltd. Registered in England and Wales No 01735950. Redhouse Interchange, Doncaster, DN6 7NA.

Save Time -Order Direct atwww.dfs.co.ukor call Free on0800 110 500024 hours a day 7 days a weekFor your nearest store details call 0800 110 5000.

Also at Basildon, Colchester, Hove, Luton, Maidstone, Milton Keynes,Peterborough, Reading, Slough, Stevenage, Tunbridge Wells.

CroydonValley Park, off Purley Way, Daniell Way. 020 8688 0083EnfieldGreat Cambridge Road. 020 8364 5404Brent CrossBX Shopping Park, Tilling Road. 020 8452 1560SidcupCrittalls Corner, Sidcup Bypass. 020 8308 9177South RuislipVictoria Retail Park, Victoria Road. 020 8842 2503New MaldenShannon Retail Park, Shannons Corner. 020 8949 7066BecktonBeckton Triangle Retail Park, Clapsgate Lane. 020 8507 3880RomfordGallows Corner Retail Park. 01708 335588

WatfordColne Valley Retail Park. 01923 219693

ON MANY GREAT DESIGNS

with4 years interest free credit or pay nothing

until Easter 2012 then take 3 years interest free credit

Corner sofa.

Available in a choice of5 colours at no extra cost.

THE MALIBAR

After Sale Price 1798.

Save 899899HALF

PRICE

THE EVELYN

3 seater sofa. Available in

a choice of 6 colours at

no extra cost. 2 accent

cushions FREE.After Sale Price 699.

Save 50

649NOWONLY

3 seater sofa in 100%

real leather. Available in

a choice of 29 colours

at no extra cost.

THE FINLAY

After Sale Price 1099.

Save 550

549HALFPRICE

HE MALIBAR

8/6/2019 Cityam 2011-08-19

9/24

CEMENT maker Holcim yesterday saidthe record strength of the Swiss franccombined with soaring raw materialand energy costs to hit its second-quar-ter profits.

Holcims operating earnings fellmore than a fifth in the three monthsto the end of June, to 1.1bn francs(843m) and net income dropped 14.9per cent to 464m francs, despite steadi-ly growing demand for cement.

The worlds second-biggest cementproducer said it was struggling to off-set higher coal, diesel and oil prices,which had added to its production andtransportation costs.

It said an appreciable number ofits subsidiaries such as Mexico andEcuador had improved their results inlocal currency terms but these suc-cesses were cancelled outby thestrength of the Swiss franc.

It also became the latest large corpo-rate to take a cash flow hit from thestrong franc its cash from operatingactivities almost halved in the quarterto 609m francs.

Its shares closed seven per centlower on the news.

But it said cost cuts and further

price rises should put it on track tomake about the same like-for-like oper-ating earnings before interest, tax,depreciation and amortisation as lastyear.

Holcim raised prices by 3.6 per centin the second quarter, and its chieffinancial officer Thomas Aebischersaid further increases were planned.

Were going to have to keep raisingprices to balance out cost inf lation, hetold a conference call.

But analysts said its Latin Americaand Asia operations were actually adrag on profitability due to the costinflation and currency effects.

Higher...costs could not be compen-sated for sufficiently through priceincreases, ZKB analyst Martin Hueslersaid.

GOOGLE will be forced to payMotorola a staggering $2.5bn (1.5bn)if it fails to clear regulatory hurdleswith its $12.5bn takeover bid.

The mammoth break fee repre-sents 20 per cent of the proposedprice, compared to AT&Ts fee of $3bnin its planned $39bn takeover of T-Mobile USA, which is just seven per

cent.If Motorola pulls out of the transac-

tion it will be liable to pay Google$375m.

Googles bid, which is driven by adesire to take control of Motorolasportfolio of 17,000 patents, alreadycomes at a premium of 63.5 per centto Motorolas pre-bid closing price.

The deal will catapult Google to thetop of the pile in the patent armsrace, which has become increasinglyintense in recent months, with hand-set manufacturers threatening a

litany of costly and time consuminglawsuits against each other.

Meanwhile, Nokia chief executiveStephen Elop has warned that otherhandset manufacturers could be dis-advantaged as a result of the bid.

He said: If I happened to be anAndroid manufacturer or an opera-tor, or anyone with a stake in thatenvironment, I would be picking upmy phone and calling certain execu-tives at Google and saying I see signsof danger ahead.

Nokia rejected Googles Android

software to work exclusively withMicrosofts WP7 earlier this year.

Googles $12.5bn Motorola bid includesan eye-watering break fee of $2.5bn

OFCOM has handed out a 3m fine totelecoms provider TalkTalk after it

incorrectly billed tens of thousands ofconsumers for services they had notreceived.

TalkTalk yesterday said it was dis-appointed by the size of the fine arecord for a telecoms company butsaid it will not appeal it.

After a year-long investigationOfcom concluded TalkTalk had wrong-ly charged some 65,000 customers as itintegrated Tiscali into its operations.Of these, 3,000 were wrongly billed

after the matter had come to theattention of Ofcom in July 2010.

TalkTalk has since paid out 2.5m inrefunds and goodwill payments to itscustomers and says it has moved on

from the difficult transition. The fine, which will be given toOfcom and passed on to the Treasury,must be paid within 30 days.

An Ofcom spokesman said: We con-sider this to be a serious breach of therules. However, we are issuing a lowerpenalty than might otherwise have been given, had the company nottaken action to remedy the harm theycaused to consumers.

A TalkTalk spokesman said: We are

of course disappointed at the scale ofthe fine and feel it is a disproportion-ate penalty. TalkTalk shares tumbled4.5 per cent in a choppy market.

Ofcom fines TalkTalk 3mBY STEVE DINNEEN

TELECOMS

APPLES sales have taken over those ofLenovo in China for the first time.

As the third-largest personal com-puter company in the world by ship-ment volume, the Chinese firm holdsthe top spot as the industrys fastest-growing firm for the seventh quarterconsecutively.

It announced yesterday that its

China sales rose 23.4 per cent to$2.8bn (1.7bn), compared to Apples

second quarter sales of $3.8bn, sixtimes the last years figure. Lenovosaw total revenue rise 15 per cent inthe second quarter to a record $5.9bn.

Analysts said that Lenovo wouldneed to have increased sales in Taiwan and Hong Kong by at least$1bn to match Apples revenues forthe region. Despite a four per centoverall decline in the market, Lenovosaw success in the US, with ship-ments rising 30.8 per cent from a year

ago, when the firm made losses of$9m in the US.

Lenovo cedes ground toApple in its native China

Holcim hit by

strong francand cost risesBYALISON LOCK

MANUFACTURING

BY STEVE DINNEEN

TELECOMS


DOLLARS DOWN: WHO LOSES FROM FRANC RISE

OSWALD GRBEL, CEO OF UBSSwiss banks have seen profits hammered bythe strong franc. UBS blamed the franc inpart for a 49 per cent fall in first-half profit to1bn francs (766m), while rival Credit Suissecited it as a factor in cutting 2,000 jobs.

HOLCIM is just the latest in a long line of major corporates citing Switzerlands record-high safehaven currency as a factor behind a dip in their fortunes. The strength of the currency has depre-ciated dollar and euro-denominated revenues and profits, while input costs and local productioncosts have rocketed, and output prices have to be raised to compensate. As firms from pharma-ceuticals giant Roche to household goods maker Procter & Gamble feel the strain, who else getshurt from the strength of the franc?

PAUL BULCKE, CEO OF NESTLEIt isnt just banks suffering from Emmentaalcheese to chocolatiers, Swiss exporters arehurting. Nestle said the franc helped make2011 one of its toughest ever years, cuttingalmost 14 per cent from first-half revenues.

TRADERS - VARIOUSPity the commodity and hedge fund tradershit by the swissies strength. Most salaries arepaid in francs but bonuses are understood tobe paid in dollars, and the franc is up 24 percent against the dollar in the past 12 months.

ROGER FEDERER - TENNIS CHAMPIONThe tennis ace has a home in Oberwil, nearBasel, but his income is international, from win-nings and sponsorships. That makes being athome expensive, though he is worth an estimat-ed $150m so may not feel it too deeply.

Firms feel Swisspain now butmore is coming

THE franc was steady yesterdaythanks to a decision by the Swisscentral bank to add massive liq-uidity to the market.

But it has been a very differentstory for the year so far as mar-kets have worsened, investorshave piled into francs with anappetite mirrored only in theirbuying of gold.

Deemed a safe haven thanks toits distance from the euro andother crisis-addled currenciessuch as the dollar and pound,the franc has risen 9.5 per centagainst the euro so far this yearand 15 per cent in the past 12months while against the dol-lar, it has gained 15.5 per cent in2011 and a whopping 24 per centsince last August.

That is causing real pain tocompanies and individuals earn-ing money in international cur-rencies but spending it inSwitzerland. Holcim is just thelatest large corporate to note thestrong franc as a factor in itspoor results.

The Swiss National Bank is cur-rently stopping short of peggingthe franc to the euro or establish-ing a floor to limit its strength.But after another day of stockmarket selling, it faces an uphillbattle to avoid still greater rises.

BOTTOMLINEAnalysis by Alison Lock

ANALYSIS l Holcim

CHF


50

48

46

44.0318 Aug

ANALYSIS l Talk Talk

p


132

128

124

121.7018 Aug

Ant and Dec's SaturdayNight Takeaway

3m*

Soapstar Superstar

1.2m*(UK)

3m

2m*

OFCOMS BIGGEST FINES

BY LYDIA ELLIS

TECHNOLOGY

* fines linked toOfcoms probe intothe fairness ofphone-in quizzes in2007-8

Ant and Dec'sGameshow Marathon

1.2m*

1.1m*

8/6/2019 Cityam 2011-08-19

10/24

time, the lease on the property can-not legally be cut short before itsexpiry date in 2056.

No chance of Brocket, 59, reclaim-ing his ancestral home then, ifKlostermann has anything to do withit. Our interest remains long term,he said. Brocket and I will both have

joined the big club in the sky by thetime the lease on the Hall runs out.

TYCOON WOMENTHE NAME of the event alone is worth

a diary story: How to Become aTycoon Woman, a seminar designedto let the Citys power ladies join theranks of Burberrys Angela Ahrendtsand Net-a-Porters Natalie Massenet.

Exactly how to achieve that will berevealed by Olamide Agbaimoni, whospecialises in helping women becomethe creators of their own wealth.

Free to all, the talk will be held from2.30-4.30pm on 12 September at theCity Business Library in the GuildhallComplex at 5 Aldermanbury. Form anorderly queue.

THERE IS NO BATTLE:KLOSTERMANN DENIES

FRAUD LORD FEUDDONT BELIEVE the tittle tattle youread in the gossip columns, saysBrocket Hall owner DieterKlostermann, who yesterday turnedto this gossip column to put therecord straight about thatfeud withLord Charlie Brocket.

Klostermanns leisure group CCAInternational bought Brocket Hall in1996, after Brocket was jailed for a4.5m classic cars insurance scam.

So relations between the two men were never going to be easy andthey were tested still further whenrumours surfaced that Brocket,reportedly appalled by the deteriora-tion of the estate, intends to win backhis ancestral home. But Klostermanninsists there is no battle.

For starters, he said, there is noth-ing wrong with the grand piano areference to Steinway-gate, afterBrocket claimed the antique show-piece had been damaged by the new

landlords. Our finance director JimMoore said he was not aware of anydamage to the quality of the sound,and there is nothing wrong with theappearance.

The estate is a showcase, contin-ued the chief of CCA International,reeling off a list of his companys12m investments in Brocket Hall,including refurbished bathrooms,the new 18-hole golf course and theMichelin-starred Auberge du Lac.

And what of the reports that CCAInternational is experiencing cash-flow difficulties? Matters haveimproved since the last publishedaccounts for 2009, which showed a900,000 pre-tax loss, insistedKlostermann, pointing out that the

firm was back in the black in 2010and ahead of budget for 2011.

Which brings The Capitalist to thefinal point: as long as CCA hasenough money to pay its rent on

Straight talking: Dieter Kloster-mann, chairmanand CEO of CCAInternational

Picture: PA

Weve teamed up with Distinct

to bring you an amazing deal.

A really powerful tablet. Now at a uniquely exciting price.

Business

Business

Business

yBooklaPyrkBerhe Blact teAnd g

hly* business plan including 2000 minutmont

evCuryrkBerChoose a Blac

ou an amazing deal.ing yo brt

eamed up wite tveW

t 10*or jusfyBook

aes and 3GB dathly* business plan including 2000 minut

y9300 on a T-Mobile 45 pa

ou an amazing deal.

h Distincteamed up wit

ou an amazing deal.

h Distinct

yBooklaPyrkBerhe Blact teAnd g

t 10*or jusfyBook

e at point of connectiongharf c*one of

acth contr*24 mont

mation call 0800 107 2001ore infor morF

w at a uniqt. Noableful terweally poA r

MC36018440_0811

mation call 0800 107 2001

.iceciting prxuely ew at a uniq

Brocket andI will bothhave joined

the big clubin the sky bythe time thelease onBrocket Hallruns out

The Capitalist10

EDITED BY

HARRIET DENNYSGot A Story? [email protected] The Capitaliston Twitter: @citycapitalist

CITYA.M. 19 AUGUST 2011

London 2012

IMAGE OF THE WEEK

This week saw the first event in the Olympic Park:the London Invitational in the new basketball arena.

In the run-up to 2012, City A.M. is publish-ing its Olympic Image of the Week. If youhave a shot you think our readers will like,

please email [email protected] withIOW2012 in the subject line. Full details:www.cityam.com/london-2012.

BASKETBALL |OLYMPIC PARK

Picture: Mansoor Ahmed

8/6/2019 Cityam 2011-08-19

11/24


AUSTRALIAN brewer Fosters yester-day rejected a $10bn (6.1bn) offerfrom rival SABMiller for the secondtime as shareholders hold out for abetter offer from the global brewinggiant.

SABMiller announced onWednesday it would go directly toshareholders to gain about half of Australias beer market, with arepeated offer of A$4.90 a share.

But Fosters said yesterday theoffer significantly undervalues thecompany. Shares in the brewer,which is expected to report flaggingprofits on Tuesday, rose as high as A$5.03 yesterday before closing atA$5.00.

They are doing the right thing.They probably will get a better pricesometime down the track and thisstrategy is probably the right one,said Craig Young, portfolio managerat Tyndall InvestmentManagement.

The market thinks that a betterprice will be forthcoming. It expectssomething above A$5 and decentlyabove A$5. So youre talking A$5.10, A$5.20, maybe even as high asA$5.30, he said.

SABMiller, which makes Peroni,Grolsch and Miller Lite, has long been seen as the favourite to takeover Fosters since rivals such asHeineken are struggling with debtor lack adequate funding.

Fosters boasts high margins anda dominant position in Australia,

although beer volumes have saggedrecently with a poor summer andconsumer downturn.

SABMiller could have strength-ened its hand by waiting longer tomake a direct offer in the absence ofa rival, shareholders said, signallingan improved bid may emerge.

Fosters turns down

new SABMiller bidBYHARRY BANKS

M&A

PRIVATE equity firms PacificEquity Partners and Unitas were yesterday toasting the sale oftheir drinks group IndependentLiquor to Japanese brewer Asahifor $1.3bn (787m).

Asahi, the maker of Super Drybeer, will buy all the outstandingshares of Flavoured BeveragesGroup, the parent company ofNew Zealand-based Independent.

PEP and Unitas, formerly

known as CCMP, boughtIndependent for more than $1bn

in a 50-50 split back in 2006.Independent Liquor is New

Zealands top-ranked ready-to-drink cocktail maker and is thethird-largest in Australia.

Asahi aims to earn six per centof its sales from overseas marketsthis year, which is below a targetof 30 per cent set by Japaneserival Kirin Holdings.

Shigeo Sugawara, senior invest-ment manager at Sompo JapanNipponKoa Asset Management,said: With domestic demand

weak, I have absolutely no dis-agreement with Asahis strategy

of seeking growth overseas.The real issue is whether or

not Asahi will be able to speed upprofit growth at the companies ithas bought.

Asahi was advised during thedeal by Rothschild and Nomurasteam of Koji Nagai, KimizoHayakawa, Kentaro Okuda andPeter Meurer.

Meurer was hired as Nomuraschairman of investment bankingin Australia two years ago. Hewas previously the vice-chairman

of Citi Australia.

Asahi toasts acquisition as privateequity firms sell Independent LiquorM&A

GLOOMY sentiment among investorsbolstered the return on hedge fundsdriven by short-selling strategies buthurt merger arbitrage managers lastmonth, according to researchreleased yesterday.

The strongest average returns in July were Commodity TradingAdvisors (CTAs) with a 2.70 per centreturn and short-sellers at 2.21 percent, the EDHEC-Risk Institute report-ed.

The worst returns were from merg-er arbitrage funds, which suffered anaverage 0.46 per cent loss, with event

driven hedgies typically dropping invalue by 0.36 per cent.

The 1.01 per cent return on globalhedge fund-of-fund strategies out-paced the Standard & Poors 500

index by more than three per cent.Meanwhile it was revealed some

major names in European hedgefunds have suffered heavy losses.

Funds managed by LansdownePartners were among those hit. TheLansdowne UK Equity fund dropped4.3 per cent in the month to 12 August, and is down 15.8 per centthis year. The Lansdowne EuropeanEquity fund is down 3.6 per cent thismonth to 12 August, and is down 9.4per cent in the year.

The Lansdowne Global Financialsfund is down 3.6 per cent in themonth to 12 August, and down 12.5per cent this year.

The Henderson European Absolute

Return fund, managed by StephenPeak, dropped 15.64 per cent in themonth to 5 August, and is down 32.46per cent this year to 5 August.

Both groups declined to comment.

Shorting hedgiesoutpace the S&P

500 during JulyBY PETER EDWARDS

HEDGE FUNDS

SPREAD better London Capital Groupbucked yesterdays downward stockmarket trend to close up 0.7 per centafter reporting a 3m first-half profit.

LCG said profits fell 28 per centcompared with a year ago when busi-ness was boosted by extreme volatilityaround events such as the flashcrash and Greek bailout. Revenuesfell 12 per cent to 18.3m.

Keefe Bruyette & Woods analystJustin Bates said the figures were atepid result in a difficult market butits outlook gave cause for optimism.

LCG said new accounts openedwere up almost 20 per cent on a yearago, while funds in accounts weremore than a fifth higher at 24.6m.

It also said the spread betting mar-ket, where it makes 61 per cent of itsrevenue, was robust.

Chief executive Simon Denham warned that regulation, costs andvery low spreads remained risks butsaid the outlook for the rest of 2011was very good.

London Capitalbets on profitrise to come

FINANCIAL SERVICES

The Gannet Alpha platform is still leaking oil into the North Sea Picture: REUTERS

ANALYSIS l SABMiller

p


2,140

2,100

2,060

2,020

2,010.0018 Aug

ROYAL Dutch Shell said it was continu-ing to make good progress fixing apipeline that is still leaking into theNorth Sea from its Gannet Alpha plat-form, as Britains biggest oil spill for adecade ran into its eighth day.

Shell estimates that around 1,300 barrels have escaped into the water

180km off the Scottish coast so far,with the risk in the worst case sce-narioof another 4,000 barrels leak-ing from the isolated flowlinebetween the well and the platform.

Shell, which co-owns the field withExxon Mobil, said an area on the seasurface of around 500 square metreswas currently affected by the spill.

Environmental charity the RoyalSociety for the Protection of BirdsScotland made calls yesterday for thegroup to make public its most recentpipeline inspection report.

But Shell insisted that its surveysshowed the leak had not had a signif-

icant impact on the environment.Shell said divers have been sent

down to inspect the faulty valve andlay down concrete weights to securethe pipeline to the seabed.

Shell pipeline still leakingBYKASMIRA JEFFORD

ENERGY

8/6/2019 Cityam 2011-08-19

12/24

CINEWORLD yesterday said it hadstarted the second half strongly, withthe latest Harry Potter film fuellingan increase in ticket sales.

The group has hiked its dividenddespite a drop in first-half profit, trig-gered by one-off costs.

Revenues rose one per cent to163.6m in the six months to the endof June.

Operating profits fell by 1.8m to13m, due in part to the cost of cine-ma conversions to cope with digitaland 3D films.

The first-half costs include a provi-sion of 1.1m for conversions in thesecond half and next year.

Cineworld saw 2.2 per cent rise inadmissions in the first half while thesecond half figure will reflect the suc-cess of The Deathly Hallows Part 2 the final instalment in the HarryPotter series.

However a lack of 3D releases tooksome steam out of the groups per-formance, which had previously beenboosted by blockbusters like Avatar.

A total of 478 screens across 78 sitesare now digital and 400 of those sup-port 3D technology.

Steve Weiner, the companysfounder and chief executive, said hehoped the ongoing conversion... willenable us to further capitalise on thestrong line-up of 3D releases in thefourth quarter.

Mission Impossible 4, SherlockHolmes 2 and the latest in theTwilight series were part of a strongset of non-3D films coming to the-atres in the second half, the firm said.

Cineworld also said its search con-tinued for a new chief financial offi-cer after Richard Jones, a 15-yearveteran of the company, resigned in June. The companys purchase ofSpains Cinesur has not yet complet-ed, the company said, adding Webelieve that the Spanish cinema mar-ket has certain attractions.

AIR Berlin founder and chief execu-tive Joachim Hunold quit yesterdayafter the low-cost carrier posted aquarterly loss and cut its network inthe quest for its first annual profitsince 2007.

If the board accepts Hunolds sug-gestion, Hartmut Mehdorn, the for-mer head of state-owned rail operator

Deutsche Bahn, would take over asinterim chief executive from 1

September.Shares in the carrier, Germanys

second-biggest airline after Lufthansa briefly turned positive after theannouncement, rising as much as 4.4per cent, but then dipped.

The debt-laden carrier said it wassuffering from a German air traveltax and high fuel costs that it wasunable to pass on to customers.

It said it would focus on profitableroutes by cutting more than one mil-

lion seats from capacity, though itdoes not expect any positive impact

on earnings before next year, when itaims to break even. Hunold launchedAir Berlin in 1991 and took it publicin 2006.

From record levels of over 20 in2007, the shares slumped to below 4the following year and have neverreally recovered.

Air Berlin warned that low-cost car-riers would suffer disproportionatelyfrom the air travel tax levied inGermany since the start of the year.

At the end of June, Air Berlins netdebt stood at 616m (535m).

Air Berlin chief quits after a quarterlyloss and plans for drastic network cuts

MORE than 750,000 tourists watched

a Premier League football match last year, splashing out an eye-watering595m.

Big spending football fans part with an average of 776 each, wellabove the average for all inbound vis-itors of 563.

Norwegians are most likely tocome to watch Premier League football, with one in thirteen of theirtourists going to a match during theirstay, followed by visits from the UAE.

The most popular grounds are OldTrafford, with 15 per cent of the total,followed by Anfield and the EmiratesStadium.

Around 40 per cent of those goingto a football match said that watch-ing sport was the main reason for vis-iting the UK.

Football tourism also attracts peo-ple to the UK outside of the usual hol-iday period, with the majority of visits taking place between Januaryand March.

VisitBritain says the research, car-ried out by the national tourismagency, is the first demonstration of

the Premier Leagues ability to drivetourism in the UK.

Premier League chief executiveRichard Scudamore said the number

of football tourists is very encourag-ing.Patricia Yates, director of strategy

at VisitBritain added: Not only dosome of the best players in the world want to play in Britain, but theirinternational fans want to followthem here.

Our partnership with the PremierLeague has enabled us to use footballto connect with fans all around theworld.

Football tourists flock to UKBY STEVE DINNEEN

BUSINESS OF SPORT

Harry Potter

magic liftsCineworldBY JOHN DUNNE

LEISURE

BY JOHN DUNNE

AVIATION


The Emirates Stadium is the third most-visited ground in the country Picture: REX

NEWS | IN BRIEF

Tracinda offloads MGM sharesBillionaire investor Kirk KerkoriansTracinda Corp has sold 20m shares ingambling and resort operator MGMResorts International, leaving it with a22.8 per cent interest. Tracinda dis-closed in a filing yesterday with the USSecurities and Exchange Commissionthat it still held 111,173,744 shares afterthe sale. In April, Tracinda, which isbased in Beverly Hills, California, had26.8 per cent of shares. It remainsMGMs largest shareholder, ahead ofPaulson & Co, which owns 8.5 per centof shares. Despite selling 20m shares,Tracinda said in the filing that it contin-ues to believe that there is substantialvalue in the assets of MGM Resorts and

that the company is a good long-terminvestment.

TJ Hughes creditors lose 400mDiscount chain TJ Hughes collapsed withtotal debts of 433.5m, administratorsat Ernst & Young have said, and mostcreditors have little hope of recoveringmuch of their money. The group, whichcollapsed in June despite investmentfrom turnaround specialist Endless LLP,heard from 156 interested parties over atakeover or sale of the business, but noconcrete offers have emerged. Ernst &Young said there will not be sufficientfunds to enable any distribution to non-preferential creditors, who are set tolose up to 409m. The firm has man-aged to make a net 35.6m in sales sincecalling in the administrators, but this willbe swallowed by preferred creditors. A

further 12 TJ Hughes shops will beclosed soon, bringing the total to 42.

RETAILER Sears Holdings, which iscontrolled by billionaire investorEddie Lampert, reported a wider-than-expected quarterly loss on weaksales, bigger discounts and highercosts yesterday.

In the second quarter, sales fell 1.2per cent to $10.3bn (6.2bn), whileanalysts expected $10.5bn.

Sales at US stores open at least ayear fell 0.7 per cent, with those atthe namesake stores down 1.2 percent and Kmart staying flat.

Sears net loss widened to $146m,and the firm plans to cut 250 jobs.

RETAIL

BOOKINGS for Holidaybreaks rangeof school trips, adventure tours,camping and hotel breaks fell in thefive months to August.

Superbreak, The Luxury HotelCollection and Holidaybreaks otherhotels businesses are seeing sales trailten per cent below the same time lastyear.

The company, which is being takenover by Cox & King for 312m, blamed that on the ongoing diffi-cult consumer environment.

But revenues at its outdoor educa-tion business rose.

Holidaybreakbookings drop

LEISURE

ANALYST VIEWS: IS CINEWORLD COPINGWELL IN THE TOUGH MARKET? By John Dunne

GEETANJALI SHARMA | ESPIRITO SANTO

This is a very encouraging set of results from Cineworld. It is encourag-

ing to note that despite Avatar and Alice in Wonderland being in the first half2010 comparatives and Harry Potter not included in first half 2011, Cineworldsadmissions are up 2.2 per cent year on year.

NIGEL PARSON | EVOLUTION

The company is up against tough comparatives. Strategically, the digi-tal roll-out continues well (70 per cent complete by year end), and it has refi-nanced successfully. We reiterate our buy recommendation and 245p target price;the stock remains excellent value.

WAYNE BROWN | COLLINS STEWART

Theres an element of resilience in the business model i tself here.Cinema-going is a very resilient recession activity. And the first half hasnt reallyhad any blockbusters. One thing that separates Cineworld from Vue and Odeon isthat it does have a much wider audience, driving its market-share.

Cineworld admissions are seeing a lift from The Deathly Hallows Part 2

ANALYSIS l Cineworld


190.00

185.00

180.00

p

183.0018 Aug

750,000tourists watch

footballin UK

Sears reports

surprise losses

595mtotal spendby football

tourists

213each spentover the

tourist average

8/6/2019 Cityam 2011-08-19

13/24

BUSINESS leaders yesterday said thenumber of students studying A-Levelmaths and science is still too low,despite an upswing in the number ofcandidates taking A-Levels in thesesubjects since 2010.

The number of UK students sittingA-Level maths rose 7.8 per cent sincelast year, according to yesterdays pro- visional data released by the JointCouncil for Qualifications, while thenumber of students sitting furthermaths rose 5.2 per cent.

The number of candidates sittingthe biology, chemistry and physics A-Level exams rose 7.2 per cent, 9.2 percent and 6.1 per cent respectively.

However, the number of candi-dates taking further maths repre-sents just 1.4 per cent of the totalA-Levels sat, or 12,287 students, withphysics candidates representing 3.8per cent, or 32,860 students.

This compares to 50,897 studentstaking A-level history, or 5.9 per centof the total, and 89,980 students, or

10.4 per cent, taking English.Overall, 97.8 per cent of candidates

gained at least an E grade, up from97.6 per cent last year. One in twelveexams were given the top A* grade.

Dr Neil Bentley, deputy director-general of the CBI, said: Wereencouraged more people have heed-ed the call from businesses to study A-Level maths and science, but overallnumbers are still far too low andmust increase further to meetemployer demand.

However, Bentley welcomed theincrease in the number of candidatestaking A-Level Chinese, up from 2,372in 2010 to 3,237 this year. He said:Strong exports performance inemerging markets will be crucial todriving our economic recovery, so itspositive news.

Meanwhile, PwC reported applica-tions for its A-Level job programmehave doubled since last year to 1,600candidates (see profile below).

The professional services schemegives school leavers on-the-job andcollege-based training, leading to aprofessional qualification.

DESPITE the jump in students tak-ing mathematics at A-Level, the UKrisks falling further behindother nations unlessthe qualification becomes more pop-ular, an educationcharity claims.

[A]s recent reportshave highlighted, theUK still lags well

behind its industrial competitors in

terms of participation in mathemat-ics education beyond GCSE level,

said Mathematics inEducation and Industry.

City A.Ms financial liter-acy campaign, backed byeducation secretaryMichael Gove, is workingto boost the number ofpeople studying mathe-matics beyond GCSE. To

donate to MEIs further mathssupport programme, please visit

www.mei.org.uk.

The UK is lagging behinddespite growth in maths

FINANCIAL LITERACY

OIL and gas producer Noble Energy will pay $3.4bn (2.06bn) to ConsolEnergy to form a partnership to devel-op Consols assets in the Marcellusshale.

The move is S&P 500-listed Noblesfirst into the Marcellus shale depositin the eastern US, one of the largestnatural gas fields ever discovered, andcomes amid a natural gas price slump.

Under the agreement announcedyesterday, Noble will pay $1.07bn for a

50 per cent stake in coal and gas pro-ducer Consols 663,350 undeveloped

acres and fund $2.13bn of Consolsdrilling costs over eight years. That spending will be capped at

$400m per year, and drops off whenwholesale gas prices fall.

Oil giants Exxon Mobil andChevron Corp have both entered theMarcellus shale in the past two years,spending billions to get a share of thefield that some analysts reckon couldhold a centurys worth of gas for theUnited States.

Noble Energy inks $3.4bndeal to develop shale gas

ENERGY ANGLO American, Xstrata and BHP

Billiton have approved a $1.3bn

(789m) expansion of the Cerrejonmine, home to one of the worldslargest coal deposits, in Colombia.

The diversified miners said yester-day they would invest equal amountsin the project that will increase pro-duction and export capacity by 8mtonnes per annum (mtpa) to 40 mtpaby the end of 2015.

Construction is set to start in thethird quarter and be completed by2013. The project will expand the

mine, coal handling facilities and theport.

Cerrejon contains an estimated5bn tonnes of coal, of which 2.1bntonnes are at a measured and indicat-

ed export quality status.Last year, Cerrejon exported 31.5mtonnes but produced only 30.3mtonnes due to heavy rains that bat-tered the nation.

Todays announcement highlightsour commitment to invest in growththroughout the cycle and to continueto produce at maximum volumes totake advantage of the strong demandfor energy coal, said BHP energy coalpresident Jimmy Wilson.

Cerrejon president Leon Teichersaid in an interview that he hopedthe 32m tonne exports would fetchthe firm $3.2bn this year.

We have almost all the 2011 pro-

duction sold, and external prices arehigh. For 2012, we dont see a substan-tial fall in prices, he said yesterday.

Miners eye Colombia growthBYHARRY BANKS

MINING

Science stillbelow par aspasses riseBYHARRIET DENNYS

EDUCATION

Colombia's coal industry is currently domi-nated by big thermal producers such asCerrejon, Glencore and Drummond. Cerrejon, owned by BHP, Anglo Americanand Xstrata, exported 31.5m tonnes last year

FAST FACTS | COLOMBIAN COAL


FOCUS ON: A-LEVEL RESULTS

CITY VIEWS: DO YOU THINK EXAMS ARE GETTING EASIER OR STANDARDS

ARE GETTING HIGHER? Interviews by Lydia Ellis and Eshe Nelson

I do think that students are working harder.But I think that results are being driven bythe government trying to ensure pass ratesget higher year on year, which makesme quite cynical of the statistics weare seeing.

MICHAEL WATTS | BERENBERG BANK

I don't think the increase in pass rate is becausestudents are getting clever. A head of sixth formI know says it's common for students who aren'tlikely to pass to be kicked off theircourse. Schools and colleges are allabout league tables now.

PAUL MILLER | TARDIS GROUP

"I don't pretend to be an expert on the subject but I do think the exams are getting easier over the years. Theperception you get from the media clearly suggests that A-Levels are not as hard to pass as they used to be."

STEVE MARSHALL | KELTEC

A-Level students celebrate receiving their grades yesterday, as pass rates soared to a record high Picture: REUTERS

PEOPLE always assumed Jasmine Cope, ahigh achiever who skipped a year at the SirHenry Floyd Grammar School in Aylesbury,would go on to university.

But Cope, who turns 17 tomorrow, turnedher back on higher education after thetuition fees increase left her unable to justi-fy finishing her studies with so much debt,instead becoming the youngest-ever personrecruited to PwCs school leaver programme.

Before the fees increase I was aiming forthe best universities, so I aimed for the bestin professional services, Cope told City A.M.

I wanted a job that was logical for my

maths and science skills that alsoinvolved getting out of the office tomeet clients.

Cope, who was yesterday celebrat-ing her A* in English Literature, B inBiology and C in Maths well abovethe 260 UCAS points required for thePwC scheme started the tax trainingoption on 1 August, where she is paida competitive entry-level salary.Im really enjoying it so far, saidCope, who plans to work her wayup to a leading role at thefirm after she qualifies as achartered tax advis-er in four years

time.

BYHARRIET DENNYSPROFILE

* These views are those of the individuals above and not necessarily those of their company.

JASMINE COPE

Tax programme lures high achiever

8/6/2019 Cityam 2011-08-19

14/24


SkyscapThe independent finance provider hasappointed Steven Dunne as chief finan-cial officer. Dunne was previously

financial director of Credit Solutions,where he led the sale of the business toArvato, the outsourcing division ofmedia giant Bertelsmann.

China Food CompanyThe Chinese manufacturer has hiredTang Lin as chief financial officer. Lin

joins from Shandong Haoxin, where shewas a founding partner.

Stanmore ImplantsThe medical technology manufacturerhas appointed Eric Dodd as group chieffinancial officer. Dodd joins Stanmorefrom biotechnology firm Antsoma,where he was chief financial officer.

Next FifteenThe digital communications group hasappointed Margarita AugusteWennmachers as a non-executive

director. Wennmachers is a partner atAndreessen Horowitz and co-foundedOutCast Communications Corp, whichbecame a subsidiary of Next FifteenCommunications Group in 2005.

Cushman & Wakefield

Douglas Harman has been appointedas a partner to the real estate servicesfirms EMEA capital markets team.Harman joins from the Frankfurt officeof DTZ, where he was a director.

Paddy PowerBrody Sweeney will retire from theboard as a non-executive director on 1September. Cormac McCarthy, the chiefexecutive of Ulster Bank from 2004 to

2011, will join the board as non-execu-tive director on the same date.

JefferiesThe investment bank has appointedJames Seagrave as a managing direc-tor in the global financial sponsors

investment banking group. Seagravejoins from JP Morgan, where he wasmost recently a managing director inthe financial sponsor coverage group.

Ernst & YoungHywel Ball, previously EMEIA sectorleader for energy, chemicals and utili-ties at the professional services firm,has been promoted to UK & Irelandhead of assurance.

CITY MOVES | WHOS SWITCHING JOBS Edited by Harriet Dennys

+44 (0)20 7092 0053morganmckinley.com

To appear in CITYMOVESplease email your careerupdates and pictures to [email protected] SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT

in association with

Wall St slammedby recession fears

RISING fears of another recessionhammered US stocks yesterday,sending major averages sharplylower in a return to the extreme

fluctuations investors endured aweek ago.

New worries about the health ofEuropean banks set the tone beforethe markets open, and a dismalreport on regional US manufacturingfueled a downward spiral in whichthe Dow dropped as much as 528points, spurring a flight to safe-havenassets like gold.

The Nasdaq ended more than fiveper cent lower, the S&P 500 morethan four per cent and the blue-chipDow off more than three per cent.

Thursday marks the sixth time in thepast two weeks that the S&P 500 hasmoved by four per cent or more.

Are we going to go into recession?Most market participants were look-ing for slow and steady growth, butthe statistics and the financial situa-tion here and in foreign economieshave disturbed that view, saidRichard Weiss, a Mountain View,California-based senior money man-

ager at American CenturyInvestments.

The Dow Jones industrial averagefell 419.63 points, or 3.68 per cent, to10,990.58, while the Standard &Poors 500 Index declined 53.24points, or 4.46 per cent, to 1,140.65,and the Nasdaq Composite Indexdropped 131.05 points, or 5.22 percent, to 2,380.43.

The losses resumed a slide in stocksthat began in late July and seemed tomoderate in the last few days. In amore worrisome sign, volume washeavier than on recent positive days,

with 11.4bn shares changing hands,

the highest so far this week.It almost feels as though the floorin its entirety is clearly engaged inexecutions, but the overall theme isresignation, said Peter Kenny, man-aging director at Knight Capital in

Jersey City, New Jersey.Kenny said that traders are increas-

ingly resigned to the idea the markettrend is downward.

What can you do about a trendthat seems to be well established? It'sthe new -- I hate to say it -- it is the newnormal, he said.

Volatility jumped, with the CBOEVolatility Index or VIX, a barometer ofWall Street anxiety, up 38 per cent at43.56. More investors were taking outprotective positions against declinesin the market.

The S&P 500 is now off 16.4 per centfrom its April 29 closing high, but the

benchmark index still ended above its

slump on 9 August, when it fell to1,101.54.

BRITAINS top shares dropped

yesterday in their worst one-day fall since March 2009, led

by banks on concern thegrowth outlook for globaleconomies was slowing and worriesabout contagion in the Eurozone

debt crisis.Stocks extended falls after Augustfactory activity in the US Mid-

Atlantic region dropped to its low-est level since March 2009, addingto earlier worries the US economy

was slowing down following higherthan expected weekly joblessclaims.

Not a single FTSE 100 stock closedup after yesterdays trading.

Banks tumbled to become the worst performers, with the down6.9 per cent also its biggest dailydrop since late March 2009.Barclays, Royal Bank of Scotlandand Lloyds Banking Group dropped9.3 to 11.5 per cent.

The banks are plugged into theEurozone sovereign debt crisis,said Mike Lenhoff, chief strategist atBrewin Dolphin.

But it is not just worries about

the Eurozone, it is growth in theUnited States as well.

The concern is that globaleconomies will go back into reces-sion, and downgrades to economicgrowth are likely to translate intocuts to earnings.

The UK benchmark index closeddown 239.37 points, or 4.5 per centat 5,092.23, knocking about 60bnoff the index, with volume 132 percent of its 90-day daily average.

The index has slumped 16.3 percent since the July to August sell-off

began and made its biggest one-daydrop since 2 March 2009.

It also dropped below both the38.2 per cent retracement or5,284.96 and 23.6 per cent retrace-ment or 5,096.17 of its July to

August sell-off, with the next sup-port level seen at the psychological5,000 mark.

Investors had early yesterday been concerned about a slowdownin the United States and Europeafter Morgan Stanley cut its globalgrowth forecast for 2011 and 2012citing both regions as dangerouslyclose to a recession.

The anaemic post-recessionrecovery and the pronounced mar-ket volatility indicate that both theUS and parts of Europe are on anunsustainable path, said JackMalvey, chief global market strate-gist for BNY Mellon AssetManagement.

The worst case would be a mild,

brief recession, but we are morelikely to experience a low-growth

recession over the next three to sixmonths.

Also compounding the worriesearly on that the global recovery

was losing steam was news thatDeutsche Bank had cut its expecta-tions for Chinese GDP growth dueto the slowing economic environ-ment in the United States andEurope.

Commodity stocks, whose per-formance is strongly correlated toglobal growth, were also among the

worst performers, tracking crude

and base metal prices lower.Of the mining stocks Xstratawasthe hardest hit, losing 10.2 per cent,

while Cairn Energy fell the mostamong the oils, down 8.7 per cent.Glencore also dropped 10 per cent.

Strong orporate results did littleto cushion stocks from the widermarket fall Cineworld, for exam-ple, fell one per cent despiteprogress on its refurbishment planand a rosy outlook for the year.

Biggest one-day FTSE 100fall in more than two yearsTHELONDONREPORT

THENEW YORKREPORT

BEST OF THE BROKERS To appear in Best of the Brokers email your research to [email protected]

ANALYSIS lHenderson160

140

Jun Jul Aug

p

130.0018 Aug

HENDERSONUBS rates the asset manager neutral and has trimmed its target price by10p to 145p following Wedensdays first half results figures. The broker hasalso cut its earnings forecast for the year by six per cent and now expectsmodest outflows from the groups retail segment. UBS also sees signs thatintegration with Gartmore is going well, with management indicating thatthe firm is out of the danger zone in terms of outflows linked to the merger.

ANALYSIS lResolution

300

260

Jun Jul Aug

p

260.4018 Aug

RESOLUTIONCitigroup rates the insurance vehicle buy with a target price of 367p. Thebroker reckons the group is switching gears into an acquisitions phase, fol-lowing moves to exit some of its UK businesses. Citi estimates that it sharescould soar to 414p once the exit plan is complete, based on recent transac-tion multiples, and notes that Resolutions share price is more resilient thansome peers thanks to a low asset gearing.

ANALYSIS lPersimmon

500

460

420

380

Jun Jul Aug

p

378.218 Aug

PERSIMMONBrewin Dolphin rates the property group buy with a target price of 505p.Brewin expects the firm to report a 24 per cent uplift in profitability in itsinterim results next Tuesday, though completions are expected to be 4.9 percent lower than last year. Brewin expects a pre-tax profit of 120.2m for theyear, and adds that Persimmons 32 per cent discount to its net asset valuegives the shares plenty of space to rise.

ANALYSIS l FTSE

23 May 1 Jul12 Jun 21 Jul 10 Aug

6,200

5,800

5,400

5,000

5,092.2318 Aug

MercerThe HR group has appointed Michael Dempseyas head of the investment management divisionfor EMEA and a member of the firms EMEAexecutive team and its global investment man-agement leadership team. Dempsey most

recently led Mercers investment managementbusiness in Ireland, where he launched theDynamic De-Risking Solution. Dempsey replacesTom Murphy, who is relocating to the US tobecome regional head of investment manage-ment, based in Mercers Boston office.

8/6/2019 Cityam 2011-08-19

15/24

8/6/2019 Cityam 2011-08-19

16/24

London trends:

whos moving theprime market higher?Donata Huggins finds out the buyerspreferences to help you get a great sale

Living | Market Trends16

THE headlines are clear: coreprime central London property that is central London proper-ty at the very top of the market

in places like Knightsbridge, Chelseaand Belgravia is rocketing in value,keeping pace with gold as an assetclass. Supply of these properties is nowchronically low, adding even moreupward price pressure. International

buyers are purchasing these top endhomes as investments. Last year, they

were responsible for a whopping 50per cent of all the 2m plus propertiesthat were sold last year.

So who is buying what and where?Europeans form the biggest single

bloc of the buyers, says Liam Bailey ofKnight Frank, although in terms of asingle country no-one comes close tothe Russians who are buying nearly 6per cent of the all the 2m plushomes. Buyers from Asia Pacific are

becoming more powerful too withfour countries dominating the buyingactivity: Singapore, Hong Kong, Chinaand Malaysia. China, of course, is theone to watch.

Interestingly, each nationality has aparticular taste. Ed Mead of Douglas &Gordon says: Chelsea and SouthKensington is really more of aEuropean market. Middle Eastern andRussian buyers are far more interestedin Knightsbridge and Belgravia. These

wealthy Eurozone punters are inter-ested in red brick period homes andold fashion mansion blocks. The morequintessentially English, the better.

These folk are interested in good qual-ity wood flooring and mouldings.

Middle Eastern buyers, however, are very different. Cliff Gardiner, from

Buying Solution, says: These guys areinterested in turnkey properties: thatis those that dont require any workand are entirely read to go. Jo Eccles,from Sourcing Property, says shes hadclients in the past that wanted to buyeverything in a show apartment, rightdown to the cutlery. That proved to

be an interesting inventory, shequips.

Unfailingly ethereal, the Chineselike to be beside the water for bal-ance. Carl Davenport of ChestertonHumberts Tower Bridge office says herecently presided over a grizzly proper-ty battle for a place close to Canada

Water, where a Chinese gentlemancame out on top.

Chinese buyers also like luckyeights. Davenport says, I had an ori-ental client recently who inisted thathe include two lucky eights in hisoffer. This totted up to almost the ask-ing price, so it was agreed straightaway.

When it comes to homes, Russianshave cast off any Soviet sympathies.Gardiner says: Russians love high ceil-ings and grand ballroom-style recep-tions rooms.

Those with a property that suits thetastes of these nationalities could yousitting on a gold mine. Sell up quicklyand move somewhere to start a newBritish buying trend.

8/6/2019 Cityam 2011-08-19

17/24

Q.I would like to liven up myhome with wallpaper. Whatare the current trends?

A.Wallpaper has had a revival inthe last few years after fallingout of fashion in favour of plain

painted walls. The use of wallpaper addsdetail to an interior and can also help tosoften a room. The trend over the lastfew years has been to use wallpaper tocreate a feature wall in the home, butwe are also now seeing a return to fullywallpapered rooms.

This year, we have seen lots of colouremerging in all aspects of design andthis is also true of wallpaper. There aresome wildly colourful wallpapers avail-able now that will add impact to anyroom, if you are slightly nervous of yourchoice use the bold colours in a roomyou dont often use a rich red wallpa-per in a dining room is a good example

of this.

In addition tocolour, there is alsolots of new textures nowavailable in wallpaper. Osborne & Littlehave recently introduced a great rangeof flock wallpapers that add texture toany interior. If you are feeling brave,Timorous Beasties is a supplier withsome very daring large-scale designs.Their London toile wallpaper looks initial-ly like the Toile de Jouy wallpapers of theearly 1800s but actually features scenesof modern urban London. This would bea great choice for use in a cloakroom.

Floral patterns are still very big but oftenin a more abstract larger scale than pre-viously available.

Q.I have just bought a periodproperty where all the archi-tectural details have been

removed. How do I add them backwithout it looking too false?

A.The first choice you need tomake before choosing any deco-rative features is just how

authentic you want to be. If your proper-ty is listed, there are strict rules you needto obey. If your property is not listed, thelevel of authenticity is often decided byyour budget because using materialstrue to the period of the home can bevery expensive. It pays to do someresearch before you start to makechanges, although it is ok to mix somestyles if you are not aiming for period

authenticity.

CURRENT MORTGAGE DEALS BY DONATA HUGGINS Source: MoneySupermarket.com

Lender Fixed/Flexible Rate Until apr Maximum Loan to(per cent) (per cent) Value (per cent)

Skipton BS Flexible 1.98 2 years 4.8 60

Chelsea BS Flexible 1.99 August 2013 5.4 70ING Direct Flexible 2.04 2 years 3.4 60

First Direct Flexible 2.09 2 years 3.6 65

Chelsea BS Fixed 2.39 August 2013 5.4 6

Skipton BS Fixed 2.48 November 2013 4.9 60

Santander Fixed 2.49 October 2013 4.2 60

Nationwide BS Fixed 2.89 3 years 3.8 70

Yorkshire BS Fixed 2.94 September 2014 4.6 75

PROPERTIES GOING FASTIN WOODSIDE PARK

Half of the apartments atthe Wheston Lodge devel-opment in Woodside Parkhave sold in just threemonths. The developmentconsists of 25 one and twobedroom apartments.Prices start at 275,000.Contact: Wheston Lodgeon 020 8446 9136 or goto www.thornsettgroup.com.

PROPERTY NEWSBY DONATA HUGGINS

EQUESTRIAN PROPERTYBOLTING AHEADHamptons Internationalresearch shows that in 2010,equestrian properties soldalmost twice as fast as theydid in 2009. Last year, on aver-

age a horse-y home spent 119days on the market, up froman average of 225 days in2009. In response, HamptonsInternational has launched anew equestrian propertydepartment.

SCOTTISH LUXURYHOTEL BOOM UNDERWAYHotels in Edinburgh had thehighest occupancy rates inEurope at 92 per cent inJune this year. Edinburghnot only beat other UK citieson occupancy rate (includ-ing London) but also theestablished tourist centressuch as Paris and Rome.Scottish Development

International says this couldgenerate huge returns forinvestors.

Andrew DunningCREATIVE DIRECTORAT DESIGN CONSULTANCYAPD INTERIORS

Q A&

17COWBOYS &ALIENSREAD THE REVIEWON PAGE 19

INTERIORS

8/6/2019 Cityam 2011-08-19

18/24

Computer generated image of Caxton Apartments external and photograph of typical Telford Homes interior.

Times are approximate and are courtesy of www.tfl.gov.uk. Price correct at time of going to press.

0800 883 8953or (out of hours) 0800 032 0077

www.caxtongaramond.co.uk

020 7791 7000

A development by:

CAXTONAPARTMENTS

CAXTONAPARTMENTS

LONDON E1

CITY OR CANARY WHARF?

EITHER DESTINATION INUNDER 15 MINUTES DOOR-TO-DOOR

EXCEPTIONALLY ZONE 1 APARTMENTS

High specification new apartments offering convenient City fringe living:

an easy walk to work in the Square Mile or 15 minutes

door-to-door commute (Shadwell DLR) to Canary Wharf.

STUDIO, ONE & TWO BEDROOM APARTMENTS.

Ready for occupation March 2012 (est.) PRICES FROM: 195,000

15MINs 15MINs14APA

RTMENT

S

Selling Agents:

COBOURN STREETPrice: 1,395mThis Victorian terrace house retains many of its period features. Ithas four bedrooms arranged across four floors. The interiors are welldesigned throughout. Contact: Foxtons Shoreditch office on 0207033 1414 or go to www.foxtons.co.uk

BOW | PRICES

Terrace Flats Houses All

Bow 463,515 243,536 462,778 283,626

London 448,423 340,317 476,985 408,242

Source: Savills

Commuting: Bow offers a short commuteto both the City and Canary Wharf. CanaryWharf is just 18 minutes away on the DLR,while the City is a 30-min

cityam 2011-08-19

Documents