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www.cityam.comIssue 1,484 Friday 7 October 2011 FREEBUSINESS WITH PERSONALITY

Certified Distribution

01/08/11 till 28/08/11 is 92,745

EASY MONEYlBank stuns marketswith £75bn more QE

lOsborne poised to givecredit to private firms

lECB to boost liquiditywith €40bn bond buy-up

Bank of England governor Sir Mervyn King, European Central Bank president Jean-Claude Trichet and UK chancellor George Osborne are increasing money supply in a bid to restore economic growth Pictures: Reuters

SIR Mervyn King, the Bank of England governor, stunned markets

by turning Britain’s electronic print-ing presses back on yesterday, as heannounced a second round of quan-titative easing (QE) worth £75bn.

Sir Mervyn said last night: “This isthe most serious financial crisis atleast since the 1930s, if not ever...The

world has changed,” as he launchedthe latest round of stimulus.

An extra £75bn of assets will bepurchased with newly createdmoney over the next four months,starting with £1.7bn on Monday. The

Bank will buy gilts with residualmaturities of over three years.Loosening monetary policy is nec-

essary because “the impact of therest of the world on the UK doesthreaten our recovery”, Sir Mervynsaid. “We have taken pre-emptiveaction to try to prevent the slow-down from becoming too serious.”

He particularly pointed to the weak Eurozone economy as a factordragging down UK growth.

The Bank’s monetary policy com-mittee has conceded that inflation istoo high, but adopted the inflation-ary policy nonetheless as it believesprices are increasing due to “tempo-rary” factors such as the “increase in

VAT in January and the impact of higher energy and import prices”.

Sterling fell sharply on theannouncement, worrying some ana-

lysts. “With no obvious shortage of money in the economy, ‘excess’ liq-uidity created by QE2 should support

asset prices and push down theexchange rate,” said Henderson’sSimon Ward. “A lower exchange rate

would damage growth prospects by boosting import prices and sustain-ing a high-inflation squeeze on hard-pressed consumers.”

However, chancellor GeorgeOsborne agreed with the MPC thatfurther QE would help to keep infla-tion on target in the medium term.“The evidence shows that QE willhelp keep interest rates down and

boost demand and that will be a helpfor British families,” he said.

Osborne said he was exploring“further policy options” to improvethe “flow of credit to some parts of the real economy”, in reference to

the so-called “credit easing” schemeannounced at the Conservative party conference earlier this week.

City A.M. understands the Treasury is drawing up plans to extend thescheme from small and medium-sized enterprises to larger firms andeven banks. It will sell tens of billionsof pounds worth of new gilts and usethe proceeds to buy commercialpaper.

As yields are already far lower thanin March 2009 when QE was firstlaunched, economists warned that

very large amounts of asset purchas-es may be needed to have a signifi-cant impact. Citi’s Michael Saundersput the figure at £500bn.

The MPC also voted to hold inter-est rates at 0.5 per cent for the 31stconsecutive month.

Central banks throughout the

West appear poised for a period of stimulus. The European CentralBank yesterday announced a new

covered-bond purchase programmethat will see it loan €40bn (£34.5bn)over the next year from November.Eurozone interest rates were heldsteady despite inflationary pressures.

Extra liquidity should help troubled Eurozone banks pay their bills –such as Dexia, which passed thestress tests earlier this year but hashad to be propped up by the Frenchand Belgian governments because ithas lost investors’ confidence.

Across the pond, the doves on BenBernanke’s Federal Reserve appear to

be in the ascendancy, despite opposi-tion to more stimulus from threehawks. “We believe that the Fed willalso launch QE3 within the next sixmonths,” commented Ignis Asset

Management’s chief economistStuart Thomson yesterday. ALLISTER HEATH: P2, MORE: P2-3

BY TIM WALLACE, DAVID CROW

AND JULIAN HARRIS

UK ECONOMY

▲

EXCLUSIVE: MOODY’S SLASHES RATINGS OF UK BANKS

THE FRAGILE UK banking sector will be further knocked today by a worsethan expected downgrade by Moody’s, the credit rating agency.

Moody’s has decided to reduce theratings of 14 UK banks and buildingsocieties by up to three notches, toreflect the removal of implicit govern-ment support in the event of possiblefailure.

The markets have been anticipat-

ing a downgrade but most expected atwo-notch deduction.

The more severe downgrade meansthat the ratings of around four of theUK’s building societies will now bedown to junk status. That could leavethem facing higher borrowing costs

at a time when trading conditions arealready difficult.

Some of the firms have been givena notch upwards because of areassessment of their own risk andliquidity profile. This means thatthose institutions will only suffer a

two-notch downgrade, in line withmarket expectations.

The news will be a further blow tothe sector, with fears growing thatgovernment-backed RBS might needanother recapitalisation.

Moody’s declined to comment.

BY DAVID HELLIER

BANKING▲

STEVE JOBS:A LIFE AT

APPLE’S COREPAGES 24-25

8/4/2019 Cityam 2011-10-07


News2 CITYA.M. 7 OCTOBER 2011

Why Mervyn Kingis wrong about QE

IT was strange for Mervyn King toclaim yesterday that the financial cri-sis may yet turn out to be worse thanthe Great Depression. The world facesmonumental challenges. But the massunemployment, protectionism andrise of fascism of the 1930s has so far

been avoided and many emergingmarkets are still buoyant. Over-usingapocalyptic language isn’t the clever-

est thing a central banker can do. ButKing’s real mistake was to back anoth-er £75bn in quantitative easing (QE).

The rationale for QE is that itincreases the money supply (new liq-uidity is created by the Bank, in returnfor it buying gilts) that can be spent ongoods, services, and assets. In an econ-omy with spare capacity, this boostsdemand and output (otherwise, it just

boosts prices). It also increases assetprices and collateral values. It cuts

yields on government bonds, andreduces the risk-free rate of borrowing,helping corporate and individual bor-rowing and equity valuations.

Supporters of QE argue that it is nec-essary because there is insufficientmoney in the economy to support sus-tainable growth – and that without itinflation would soon fall below target.

They rightly remind us that a collapsein the money supply in the US in the1930s turned a recession into a depres-sion. Sometimes, QE is indeed vital.

But what are the facts today? Themoney supply rose only 2.2 per cent inthe year to August, with a 2.3 per centannualised increase over the last threemonths. This was below the rate of inflation, which means that realmoney balances fell. This was also well

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EditorialEditor Allister HeathDeputy Editor David HellierNews Editor David Crow

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below historical growth rates – it rose by 6.3 per cent a year between 1998and 2003, when consumer inflation

was much lower than it is today.But as Simon Ward of Henderson –

somebody who should be appointed tothe MPC at the earliest possible oppor-tunity – points out, it is not just theamount of money that matters – therate at which it circulates from personto person matters just as much.Economists call this velocity – and ithas shot up since early 2009, as testi-fied by the fact that nominal GDP (asopposed to real GDP) is growing quick-ly as a result of elevated inflation.Interest rates are so low that nobody

wants to keep hold of cash for long.Equally crucially, the official figuresunderplay liquidity by excludingmoney substitutes such as foreign cur-rency deposits, Treasury bills, NationalSavings instruments and repos by the

Debt Management Office. A broad liq-uidity measure devised by Hendersonincorporating these rose 4.5 per centin the year to August, up from 0.9 percent a year ago.

This kills off the case for QE – espe-cially in the context of high consumerprice inflation, which loves nothingmore than excessive money to embeditself. Yesterday’s QE is equivalent to anextra 3.7 per cent on broad liquidity.

The Bank has massively underestimat-ed inflation over the past two years soits present warnings of looming defla-tion should be ignored, especially given that there is far less spare capac-ity in the economy than it thinks.Commodity prices are falling – but it

would be astonishing were the Bank tomeet its target in 2012. More QE willalso mean renewed downward pres-sure on the pound, boosting importprices even further (they are still goingup from the previous devaluation).

The effect on the money supply thistime (and hence inflation) will begreater than earlier rounds becauseUK Plc is in better shape: last time’seffort was partly cancelled out by capi-tal-raising and loan pay-downs. Giventhat the £200bn of QE to date has

boosted prices by 0.75-1.5 per cent,according to the Bank, this isn’t goodfor savers, for whom yesterday’s newsis tantamount to a declaration of war.Given that inflation is the biggest dragon demand in the UK at present, as aresult of falling real wages and wealth,QE right now makes no sense at all.

Further purchases of gilts will makethem even more expensive (prices willrise and yields fall further to evenmore ridiculous levels), fuelling acrazed and ultimately doomed bubble.Lower yields will add to pension fund

deficits and make annuities even moreexpensive. It will mean that the state-owned Bank of England will own athird of the stock of the state’s debt.

This is a huge political economy issue. The government is lending money toitself in a deeply unhealthy merry-go-round; it no longer really has a budgetconstraint. What next? Will the Bank eventually cancel the gilts it owns,thus permanently monetising muchof the national debt? These hugely sen-sitive issues must be debated urgently.

The biggest mistake is that theauthorities believe they have thepower to engineer perpetual growth

by creating ever more money whenev-er activity grinds to halt. This is ridicu-lously hubristic. Sometimes weak growth just can’t be avoided. It is ashame we live in a society so arrogantthat it cannot ever admit this.

[email protected]

Follow me on Twitter: @allisterheath

“THE EUROPEAN Central Bank (ECB)has delivered price stability. That isgood for the economy and good for

jobs,” boasted outgoing ECB boss Jean-Claude Trichet yesterday.

The same cannot be said in the UK, where CPI inflation hit 4.5 per cent in August and is expected to rise to morethan five per cent in late November.

Yesterday’s announcement of fur-ther quantitative easing (QE) prompt-ed anti-inflation protests (picturedright) outside the Bank of England.

Former monetary policy committeemember Andrew Sentance is also con-cerned. “This is a risky move whichcan only be justified on the basis of the

MPC’s forecasts – which have signifi-cantly under-predicted inflation in the

past,” he told City A.M.“In the current circumstances, QE

will do little for growth and may fuelinflation by pushing down the pound.It reinforces the widespread view thatthe MPC has lost its focus on price sta-

bility and the inflation target.”However, the Bank claims inflation

will fall sharply in the first half of 2012and governor Sir Mervyn King said thisis why an inflationary policy like QE2can be implemented.

“In order to keep inflation on track to meet the target over the mediumterm, the MPC judged it was necessary to inject further monetary stimulusinto the economy,” Sir Mervyn said.

Consumers’ expectations point in a very different direction, however.

The most recent survey from theBank, taken in August, showed infla-tion expectations of 4.2 per cent overthe next 12 months. In five years’ time,respondents expected inflation tostand at 3.5 per cent.

However, the MPC dismissed theseconcerns, claiming in last month’sminutes that expectations follow actu-

al inflation and so will drop if infla-tion falls in 2012.

Sentance: inflation may

soar as MPC loses focusBY TIMWALLACE

UK ECONOMY▲

▼-4.49%

BANK ANNOUNCES £75BN MORE QUANTITATIVE EASING

KING TURNS ON THE ELECTRONIC PRINTI

TOTAL QE:

£275bnQE 1:

£200bnMARCH 2009

QE 2:

£75bnOCTOBER 201

A GUIDE TO QUANTITATIVE EASING

Q.WHAT DID QE DO LAST TIME?

A. The Bank of England says the£200bn of QE between March

2009 and January 2010 boosted theeconomy by between 1.5 and two percent – but it also raised CPI inflation

by between 0.75 and 1.5 per cent.

Q.WILL IT WORK NOW?

A. It works primarily by increasingthe amount of cash in corporate

bank accounts – firms sell gilts andreceive newly created cash in return,

which boosts their liquidity and

their propensity to spend and investthe money.

Q.WHO DOES THAT HELP?

A. In theory, this boosts much of the economy by increasing total

demand for goods, services andassets. It also helps borrowers by cut-ting gilt yields.

Q.HOW DOES IT HIT PENSIONERS?

A.Pensioners buy an annuity pay-ing a fixed income. That means

they are hit by high inflation. Infact, anyone living off savings – orpeople without pay rises keeping up

with inflation–will have their

spending power cut if QE fuels moreinflation.

Q.WHAT ABOUTTHE GOVERN-

MENT?

A.George Osborne will benefitfrom even lower rates of interest

on government borrowing. That isparticularly important right now

because the deficit is so huge.

Q.WHAT DOES IT DO TO OTHERASSET CLASSES?

A.Gold may rise as investors try toprotect their cash from infla-

tion. Also, the falling pound willmake commodities sold in dollarsmore expensive to UK buyers.

Liquidity tends to spill over into allasset classes.

Q A&

“Clearly the impact of the rest of the

world on the UK does threaten our recovery. That iswhy we took actiontoday to try to head that off.”

SIR MERVYN KINGEDITOR’S LETTER

ALLISTER HEATH

“The evidence shows it will keepinterest rates downand boost demand and that will be ahelp for Britishfamilies.”

GEORGE OSBORNE

Anti-inflation protestors Pic: REUTERS

8/4/2019 Cityam 2011-10-07


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News 3CITYA.M. 7 OCTOBER 2011

RESS

MARKETS were rocked yesterday afterthe Bank of England announced itseven higher than expected extensionof its quantitative easing.

Stocks soared in afternoon trading,the FTSE closing a whopping 3.7 percent higher on the day, at 5291.26.

Yields on government debt initially plummeted on the news of the Bank’sextra £75bn of asset purchases. Yieldson 10-year notes fell off a cliff, drop-ping from over 2.35 per cent to under2.23 per cent in minutes of trading.

Yet gilts slipped and yields recoveredin later trading, as a rosier economicoutlook saw investors move to riskierasset classes.

Sterling dropped like a stone afterthe Bank’s announcement, fallingfrom over $1.55 to $1.53, touching itslowest rate against the dollar for over a year. Yet it recovered to end over $1.54.

The Bank of England confirmedthat it would start with the first giltpurchases of its new round of quanti-tative easing next week, buying £1.7bn worth on Monday, Tuesday and Wednesday.

Monday will focus on three to 10 year gilts, Tuesday on those 25 yearsand longer and Wednesday on 10-25 year gilts. The Bank said it would not buy any of the eight per cent 2021 gilt,the 3.75 per cent 2021 gilt or 4.25 percent 2039 gilt.

QE2 sees stockssurge as pounddrops sharply

UK ECONOMY▲

ERLING PLUNGESAINST DOLLAR...

... AND THE EURO

LT YIELDS TUMBLEFORE RECOVERING

FTSE 100 JUMPS

JEAN-CLAUDE Trichet signed off aspresident of the European CentralBank (ECB) yesterday, sticking to hisguns over interest rates yet pledgingto pump funds into the banks.

Trichet’s press conference was farcalmer than last month’s, when herailed against criticism and demand-ed that “congratulations” be extend-ed to the ECB for delivering pricestability. “We try to be up to ourresponsibilities and they are very heavy responsibilities, very heavy,”he said at the time.

But yesterday Trichet (right) struck a conciliatory tone, reflecting on hiseight years in charge. “For more thanfour years now, we have been experi-encing turbulent waters, storms,unexpected hurricanes,” he said,praising the importance of the

media during times of crisis.Interest rates will be kept at 1.5 per

cent, Trichet said, defying calls fromthe ECB’s doves to ease policy in lightof the ongoing Eurozone debt crisis.

Yet the outgoing president threw another lifeline to strugglingEuropean banks through the pur-chase of covered bonds and with arenewed offer of longer-term loansto ward off a new credit crunch.

Trichet leaves the ECB with infla-

tion across the Eurozone at around

three per cent. “Inflation hasremained elevated,” he admitted yes-terday, but said that he expects pricepressures to ease after a few months.

The French 68 year old’s legacy islikely to depend on the outcome of the ECB’s controversial bond-buyingprogramme – and whether the eurosurvives long-term without a majordepression. Two German officials -- Axel Weber and Juergen Stark -- quitthe ECB this year in protest at theplan.

Trichet will be replaced by Italianc e n t r a l banker andeconomistM a r i oDraghi.

Trichet bows out withsupport plan for banks

BY JULIAN HARRIS

EUROZONE ECONOMY▲

JEAN-CLAUDE TRICHET

ALYSIS l GBP/USD

00 06:00 12:00 18:00

1.5439

6 Oct

ANALYSIS l GBP/EUR

00:00 06:00 12:00 18:00

1.158

1.150

1.154

1.14796 Oct

ANALYSIS l FTSE 100

p

08:00 10:08 12:17 14:26 16:35

5,291

5,207

5,123

5,291.266 Oct

ALYSIS l UK 10 year gilt yield

%

9: 00 1 1:0 0 1 3:0 0 1 5: 00

2.39

6 Oct

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SHARES in Dexia were suspended yes-terday as Belgium prepared to nation-alise its arm of the ailing bank.

The stock plunged 17 per cent to €0.85 as tempers frayed betweenFrance and Belgium over how todivide the bill for its latest rescue.

Didier Reynders, the Belgianfinance minister, said his nation didnot want to bear the full cost of sav-ing, and possibly nationalising,

Dexia’s Belgian banking arm as wellas supporting a “bad bank” of assetsleft over from the Dexia Group’s past

business.“We do not wish to end up holding

the whole of Dexia Group. We need asolution that means we are not justfinancing the Belgian bank. We alsoneed to finance the past. And we donot want to do that alone.”

France did not respond but sourcesclose to the negotiations said the twonations might settle for a 50-50 split

to cover the bad bank assets.Dexia said it has begun talks with

an international investor about sell-ing its Luxembourg arm, and Qatar isrumoured to be interested in a dealpriced at €900m. The bank’s board

will vote on the break-up plans inParis tomorrow.

Dexia, which passed EuropeanBanking Authority stress tests thissummer, was previously bailed out

with €6.4bn from the governments of Belgium, France and Luxembourgthree years ago.

Dexia sharessuspended asbailout looms THE City watchdog is examining

Royal Bank of Scotland’s portfolio of troubled commercial property loans,as the Eurozone debt crisis causesfresh volatility in property prices,industry sources said yesterday.

The Financial Services Authority wrote to Derek Sach, head of RBS’sGlobal Restructuring Group, last

week after sending its officers to quizstaff and monitor the business.

One source familiar with the situa-tion said the FSA wanted to under-stand state-owned RBS’s exposure toreal estate through GRG, an intensivecare section for distressed businessesthat holds about £40bn of troubledcommercial property loans, andthrough its West Register unit.

“A letter was sent last week,” thesource said. “The FSA wants to know

what happens if commercial realestate completely drops, what the risk position is.”

A second source said the FSA want-ed to understand how and why somecommercial property assets weremoved into GRG and West Register

while others were not.RBS set up West Register in the

1990s to take on properties from dis-tressed lending situations to avoidselling them in the open market atknockdown prices.

FSA checks upon RBS’s badproperty book

Customers at troubled bank Dexia Picture: GettyBY PETER EDWARDS

BANKING▲

REGULATION▲


ANALYSIS l Dexia SA

€

30 Sept 3 Oct 4 Oct 5 Oct 6 Oct

1.40

1.20

1.00

0.856 Oct

WHITEHALL FEARS NEW BAILOUT FORRBSNervousness is growing in Whitehallthat the government might have toinject further capital into Royal Bank

of Scotland as part of a Europeaneffort to recapitalise the continent’s

banking system. RBS received the biggest bail-out of the 2008 crisis

GOULD LEADS RACE TO BECOME BGCHAIRMAN

Andrew Gould, the well-respected for-mer chief executive of oilfield servic-es group Schlumberger, has emergedas the leading candidate to take overas the next chairman of oil and gasfirm BG Group.

LONE STAR IS FOUND GUILTY OF STOCKFRAUD IN BANK DEAL

A Texan private equity fund was finedmore than £13 million and its former

boss in South Korea jailed for three

years after being found guilty of shareprice manipulation in Seoul yester-day.

WALL STREET PROTESTS SPREADACROSS THE USDemonstrations against wealthinequality took place across the US

yesterday, giving fresh impetus togrowing anger against the power of financial corporations. allies took place in Washington DC, Boston andNew Jersey.

WHAT THE OTHER PAPERS SAY THIS MORNING

8/4/2019 Cityam 2011-10-07


EUROPE’S banking watchdog refusedto rule out a new stress test of theregion’s banks yesterday, but playeddown expectations that it would actquickly to resolve fears over theirrisky sovereign debt levels.

The European Banking Authority said it had not announced any new

bank stress test. It would not confirmor deny whether it would begin a new test to investigate the vulnerability of

banks’ Eurozone bond holdings.

A spokeswoman said the EBA was“reviewing banks’ capital positions”and had “the support of theEuropean Systemic Risk Board”.

But she said it had no new figureson banks’ sovereign debt holdingsother than those it published in July,

with the results of its previous andnow discredited test of their strength.

The EBA also emphasised that itstwo-day meeting that ended yesterday

was routine and nothing to do withthe crisis in Franco-Belgian bank

Dexia, which is collapsing under the weight of its peripheral Eurozone bond holdings.

“The board of supervisors meetingis an ordinary and scheduled meeting

where different items are on theagenda, including, of course, discus-sions on the current situation,” thespokeswoman said.

“We are aware of the political dis-cussions going on but as EBA, we area technical body and we are not tak-ing a position at political level.”

The EBA has faced widespread crit-icism over the past week af ter it rated

Dexia 11 out of 90 European banks onthe strength of its finances in July’sstress test results.

But the tests did not look at theeffect of a massive slump in the valueof banks’ sovereign debt holdings,

which is what has brought Dexia toits knees.

It has been locked out of the daily market for inter-bank loans to bal-ance its books because of concernsthat its €3.4bn (£2.2bn) pile of Greek debt is now worthless.

Europe mullsplan for morestress tests

CLEARING house LCH.Clearnet yester-day added gold to the list of assetsinvestors can post as collateral againsttrades in light of the meteoric rise indemand for the safe haven metal.

LCH will accept gold in 400 troy ounce gold bars from the end of October as it joins a group of highly liquid and high-grade assets such as

AAA-rated bonds considered easy tosell quickly when needed.

LCH’s move acknowledges the soar-

ing popularity of gold as a high quali-ty asset, as well as the sheer amountof the metal being held by investors inportfolios at present.

“Gold is ideal; as an asset it typically performs well in times of financialstress, remains liquid and has a wellestablished pricing mechanism,” saiddirector David Farrar.

LCH said it had the backing of the World Gold Council, which is lobby-ing the Basel III council to let banksinclude gold in their Tier 1 assets.

LCH.Clearnet to take goldas collateral for trades

BYALISON LOCK

REGULATION▲

BYALISON LOCK

CAPITAL MARKETS▲


LCH.Clearnet chief executive Ian Axe will allow investors to use gold as collateral

FRANCE’S government plans to takestakes in its biggest banks if they sufferhuge losses from falls in the value of their sovereign debt holdings, a Frenchnewspaper reported yesterday.

Le Figaro newspaper said the gov-ernment agency that manages stateshareholdings had been working for afew days on how it would act if it hadto move to bolster one or more banks.

The French government has repeat-edly denied that it has agreed a back-room deal with banks such as BNPParibas, Société Générale and Crédit

Agricole to guarantee their health inthe event of a massive write-off in the

value of their Eurozone bond piles. The paper quoted a source close to

the matter saying the plans hadinvolved a scenario where intervention

was limited to two or three banks,

unlike a broader support plan drawnup in 2008 in the last financial crisis.

In September the government saidno such plan existed, and commenta-tors have argued that state support forthe banking sector would leave Franceat risk of losing its AAA credit rating.

But some City traders have privately voiced their belief that French bank chief executives have been so publicly confident of avoiding losses from theirsovereign debt holdings that theremust be some government guarantee.

France said tohave a plot toshore up banks

BANKING▲

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UBS INVESTMENT Bank has axed itsentire macro directional tradingteam, with the loss of 13 jobs.

David Tait, managing director andglobal head of macro directional trad-ing, resigned last Friday after UBSannounced the closure of his tradingteam the previous day.

Tait is currently on gardening leave before taking up a new role at a rivalinvestment bank.

The remaining 12 traders in Tait’steam are expected to secure new jobsat hedge funds, after beingapproached by a number of firms tomove either individually or as a group.

Sources close to UBS said it hadalready decided to cut 1,600 jobs in itsinvestment banking arm worldwide,as part of a wider drive to cut costs by £1.5bn by the end of 2013.

But another source maintained theclosure of the macro-directional trad-ing division was a result of the alleged

£1.5bn fraud by Kweku Adoboli, as theSwiss bank moves to de-risk its invest-ment banking business.

The source told City A.M.: “UBS has withdrawn from all types of direction-al risk-taking as a consequence of Kweku Adoboli. The core of the UBS

business is wealth management, andfrom a reputational point of view, UBSInvestment Bank has not done itself any favours.”

Yesterday Mike Stewart, who hasreplaced Francois Gouws and YassineBouhara after they quit as co-heads of

global equities over the “rogue” trade,told staff he is under “no illusion”about the challenges faced by the

bank and the rest of the industry.His comments came 24 hours after

acting chief executive Sergio Ermottiadmitted UBS had seen signs of sus-pect trades. He said “risk and opera-tional systems did detectunauthorised or unexplained activity

but this was not sufficiently investi-gated, nor was appropriate actiontaken.”

UBS sheds 13 jobs by axingtrading deskBY HARRIET DENNYS AND PETER EDWARDS

BANKING▲

NewsCITYA.M. 7 OCTOBER 2011 7

SHARES in telecoms group Ericsson jumped almost six per cent yesterday after reports claimed that Japanesetechnology group Sony was close to

buying it out of their mobile phonehandset joint venture.

Sony is keen to take control of the business to combine Sony Ericsson’smobile phone technology with itsown tablet computer and PSP gaminghandset operations

The news, reported in the WallStreet Journal, highlights how impor-tant the multi-platform smartphonehas become to consumers.

Both firms had agreed to review the 50-50 joint venture after ten years.

That deadline comes up this monthand both sides have been talking for

weeks about whether to extend it,according to sources.

Both sides declined to comment onthe reported talks. “We have a long-term commitment to our joint ven-tures,” an Ericsson spokesman said.

Analysts say Sony needs to assertcontrol over Sony Ericsson if the ven-ture is to recoup market share in thecut-throat world of smartphones.

The venture thrived with it Walkman music phones anCybershot camera phones, but haslost market share to rivals such as

Apple.

Sony set to buyEricsson out of mobile venture

TECHNOLOGY▲

NO ALL-CLEAR FOR SOROS ON INSIDER TRADE

VETERAN financier George Soros failed to convince the European Court of Human Rights to overturn his 1988 conviction for insider trading on French bank Société Générale yesterday. The court said that Soros, who made $2.2m (£1.4m) on SocGen sharesafter being told privately that a group of bidders was trying to buy the bank, shouldhave known he was risking insider trading. He has vowed to appeal. Picture: REUTERS

8/4/2019 Cityam 2011-10-07


8/4/2019 Cityam 2011-10-07


GSO Capital Partners, the global cred-it platform of US private equity giantBlackstone, has bought Europeanleveraged loan managerHarbourmaster Capital for an undis-closed sum.

Harbourmaster manages and advis-es on €8bn (£6.96bn) of assets, liftingGSO’s loan platform to €11.5bn of assets under management.

The deal will help GSO to achieveits sought-after European growth andto create a balance with the US opera-tions. Europe will now contribute

between 40 and 45 per cent of GSO’sleverage loan platform.

SHARES in the support services groupMouchel plunged more than 33 percent yesterday after chief executiveRichard Cuthbert resigned as the firmrevealed that a costly “actuarial error” would hit annual profits.

The maintenance and infrastruc-ture firm said that a one-off gainannounced in June – which it said would help offset contract cancella-tions – will be £4.3m lower thanexpected.

In a further setback, Mouchel saidits new finance director Rod Harrishad reviewed the group’s other con-tracts and has decided to increase pro- visions by a further £4.3m to coverrisks to its contracts – a move it alsotook last year.

Mouchel, which earlier this yearrejected a 164p a share takeover offerfrom rival Costain and a 135p pershare bid from Interserve, saw sharesfall as low as 15.5p in early morningtrading before closing down 33.87 percent at 20.5p.

Analysts said the firm was likely tolower their adjusted pre-tax profit fore-

casts from £14.3m to as low as £5m fol-lowing the announcement.

Christopher Bamberry, an analyst atPeel Hunt, warned that the shortfall inprofits makes it highly probably that it will breach its interest covenants.

“With a probable covenant breachand an over-leveraged balance sheet, itis hard to see how a rights issue can beavoided,” he said.

Mouchel said that Cuthbert had ten-dered his resignation with immediateeffect and that he would work withthe group for a short period to ensurean orderly handover.

Chairman Bo Lerenius will lead thecompany until a new chief executivehas been appointed.

Mouchel boss

resigns afterprofit error

Blackstone armbuys loans firm

BYKASMIRA JEFFORD

SUPPORT SERVICES▲

FINANCIAL SERVICES▲


ANALYSIS l Mouchel

p


35

25

20.506 Oct

PROFITS at British recruitment compa-ny Hays grew by 15 per cent in the firstquarter, despite a poor performance by its UK operations.

The rise in net fee income was driv-en by strong growth overseas – particu-larly in Asia Pacific and continentalEurope – which was enough to offset afour per cent drop in revenues from

the UK and Ireland. The company blamed a sharpdecline in public sector markets forthe UK slump, as well as “difficult mar-ket conditions in our banking andCity-related businesses”.

Hays is the latest recruiter to high-light sluggish hiring in the City. In August, Michael Page chief executiveSteve Ingham said that growth fromthe banking sector was slowing in a“challenging” UK market.

Profits up at Haysdespite City freezeBY ELIZABETH FOURNIER

RECRUITMENT▲

BBC TO QUIT ICONIC WHITE CITY CAMPUS AND CUT 2,000 JOBS

THE BBC will quit itswest-end White Citycampus and become“significantly smaller” in response to deepspending cuts imposedon the publicly fundedbroadcaster. It set out

the changes inresponse to a 20 per cent cut to its annual £3.5bn budget imposed by the government a year ago. Around 2,000 jobs willbe shed as part of thechange.

Picture: PA

Del Monte andBarCap settle

DEL Monte and its financial adviserBarclays Capital yesterday agreed topay $89.4m (£57.9m) to settle a law-suit that claimed they had not actedin investors’ best interests in the foodcompany’s $4bn buy-out last year.

Investors claimed that Barclays, which advised Del Monte on its sale toa private equity group led by KKR, hada conflict of interest because it alsoarranged financing for the buyers.

The two parties will share the bur-den of the settlement, with BarCappaying $23.7m upfront to Del Monte

shareholders and ceding $21m of advisory fees.

ENFORCEMENT▲

8/4/2019 Cityam 2011-10-07


BANKING’STOP TEAMS

SEEK NEWPASTURES

THE EXODUS of senior banking talentcontinues – and with it, some interestingtales emerge.

Take Merrill Lynch’s broking starSimon Fraser, who has informed hisclients Man, Meggitt and Capital OneShopping Centres he is leaving them atthe end of the year for pastures new.Quite literally, in this case, as Fraserowns an estate in Suffolk and is abandon-ing the City for a life as a farmer.

Meanwhile, you may know David Tait, who resigned from UBS Investment Bank last Friday after his trading team wasaxed, as the global head of macro direc-tional trading at the Swiss bank.

Or perhaps you will recognise him asthe lunatic who has scaled Everest fourtimes, “dancing with death” on theKhumbu icefall on his most recentascent in May. “It was an ordeal fromstart to finish,” said Tait at the time.

Although it’s arguably nothing com-pared to working 14-hour days to help theUBS bottom line for the last two years,only to see a rogue trader “throw a span-ner in the works”. “People feel the rug has

been pulled out from under their feet,”said one battle-scarred UBS mole.

ing the tandem sky dive.Meanwhile, Kreab Gavin Anderson asso-

ciate Natalie Biasin did an all-nighter lastSaturday by taking part in the Shine noc-turnal marathon with four colleagues.

Help them beat their target of raising£3,000 for Cancer Research UK by visit-ing http://www.justgiving.com/Kreab-Gavin-Anderson2

CHAMPAGNE FOR LIFEHURRY while stocks last: hedge fund god-

father Lord Stanley Fink and his businesspartner David Johnstone are offering allthe women in the City free champagnethrough their Free Holdings venture.

Anyone who signs up for aChampagne for Life card beforeSunday will receive a free case of Laurent Perrier with their lifelong

membership that ensures a glass of champagne on the house every timemembers visit one of London’s 50 affiliat-ed venues. The catch? A one-off fee of £500.

See http://champagneforlife.com/joinus

GOING WITH A BANGCALLING anyone who can remember theCity before the Big Bang. On 26 October,Brian Winterflood of Winterflood

Securities (right), Alan Yarrow from TheSecurities Institute and the London Stock Exchange are holding a twenty-fifthanniversary reunion for anyone who

worked on the LSE floor before 1985. The youngest person expected at the

Drapers Hall party will be 45, and the old-est would have been 101 – except Jimmy Herbert, who started his stockbrokingcareer as an office boy in 1929, unfortu-nately died two weeks ago. “We hoped tohave him as the guest of honour,” saidorganiser Simon Cowan of Redmayne

Bentley, who used the Big Bang to launchthe first interdealer broker First Equity.

Tickets for the charity event are on salefor £100 – for cocktails, “light music” and“very nice gifts” from the LSE, RSVP to

Yasmin Kazi on 0207 696 5471.

PINK LADIES THEY weren’t pushed – they jumped. Outof a plane, at 12,000 feet, in aid of Breakthrough Breast Cancer.

Step forward Deloitte partner ElliePatsalos and Linda Taylor, the managingdirector of beauty distributor KennethGreen Associates, who were part of ateam of seven pink ladies (pictured topright) who raised £165,000 by complet-

UBS banker and Everest mountaineer David Tait is moving on to his next career peak

The Capitalist10 CITYA.M. 7 OCTOBER 2011

EDITED BY

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

8/4/2019 Cityam 2011-10-07


MEDICAL diagnostics firm Axis-Shield said it had agreed to be bought

by larger peer Alere after the US com-pany modestly sweetened its offer to£235m, ending a three-month battlefor the maker of Afinion devices.

Axis-Shield’s shares, which havegained about 34 per cent in valuesince Alere first pitched the offer to

the board in July, closed up four percent at 468p yesterday on the LondonStock Exchange.

“Capitulation seems to be the orderof the day...We believe, under moresettled circumstances, the board may have considered to take a more robustposition. The move from 460 pence to470 pence is not much more than atoken gesture,” analyst Mike Mitchellat Seymour Pierce said.

Axis-Shield said it would recom-

mend that shareholders accept the470-p per share bid, which is abouttwo per cent higher than Alere’s orig-inal offer and four per cent higherthan Axis-Shield’s Wednesday close.

Dundee, Scotland-based Axis-Shield, which still considers the offerto be undervalued, said it expected

Alere’s revised 50 per cent acceptancecondition to be met against a“volatile economic and market

backdrop”.

Axis-Shield bows to newbid from US peer AlereBYHARRY BANKSPHARMA▲


NO SLY PRACTICES AT MIRROR, SAYS BAILEY

A probe of the Trinity Mirror newsrooms ordered by chief executive Sly Bailey has con- cluded there is no evidence of widespread phone hacking at the company, recommending only small tweaks to the firm’s practices. The results of the probe come amid fresh allega- tions that the firm’s People title routinely hacked into voicemails, made by a former jour- nalist at the newspaper. Picture: REX

8/4/2019 Cityam 2011-10-07


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STOCKBROKER Brewin Dolphin grew its assets in the year to the end of September as investor patternschanged amid market fears.

Funds under management grew 3.4 per cent as investors pouredmoney into Brewin’s discretionary range of products, ahead of toughermarket conditions in the fourthquarter.

Brewin now runs £24bn on behalf of private investors, charities and

pension funds, up from £23.2bn a year ago.

Discretionary funds under man-agement rose 11.4 per cent afterclients added £1.3bn of net inflowsduring the year, outweighing nega-tive market movements and smalloutflows from its advisory funds, themanager said in a statement.

The group added: “The fourthquarter has seen difficult marketconditions.”

Brewin said a deal to sell its corpo-

rate advisory and broking division,announced in May, is likely to becompleted by the end of this year. The division has continued to tradeprofitably, before taking intoaccounts costs relating to the sale, itadded.

Shares in Brewin, which last year was rumoured to be a takeover targetfor India’s billionaire Hinduja broth-ers, closed up 2.99 per cent at 117.2p.

David McCann at Numis ratedBrewin a “hold” and said he wouldrather own other sector stocks, suchas Aberdeen Asset Management.

Brewin seesassets growamid turmoil ARBUTHNOT Banking is to f loat its

Secure Trust Bank division onLondon’s junior Aim stock market, aspart of plans to develop its businessand compete with the UK’s majorlenders.

Arbuthnot expects Secure TrustBank’s flotation to take place by theend of the month. It will place new and existing shares in Secure TrustBank on to the market, with Arbuthnot keeping a majority stake inthe company.

Secure Trust Bank had first-half pre-tax profits of £5m and net lending of £5.7m per month on average for thefirst half of this year.

“The challenges, distractions andlegacy issues faced by the large UK banks and the consumer credit sectorprovide Secure Trust Bank with a sig-

nificant opportunity, as a well-capi-talised deposit funded bank, to grow within its chosen markets,” Arbuthnotchairman and chief executive Henry Angest said in a statement yesterday.

Secure Trust Bank chief executivePaul Lynam said the company couldmove into spaces in the market asmajor banks cut costs and scale back business plans.

The Arbuthnot Banking Group alsoincudes Arbuthnot Securities and Arbuthnot Latham private banking.

Arbuthnot to

float its Secure

Trust Bank arm

Part of the Arbuthnot group sponsors The Historic Grand Prix Cars Association

BY PETER EDWARDS

WEALTH MANAGEMENT▲

BANKING▲


ANALYSIS l Brewin Dolphin

p


121

119

117

115

117.206 Oct

HAWKPOINT Partners is advisingArbuthnot on the Secure Trust Bankflotation process, fielding a team ledby Lawrence Guthrie, managingdirector in its financial servicesteam.

Guthrie has previously advisedextended warranties specialistDomestic and General Group on itssale to Advent International for

£542m, and helped the Manchester-based Davenham Group in its pur-suit of commercial leasing and hirepurchase company Manor Credit.

Also on the Hawkpoint team isSunil Duggal, who helped software

group 1st - The Exchange with thesale of a majority stake to LloydsDevelopment Capital.

Earlier this year Hawkpoint wasthe lead corporate adviser to SaintGeorge Participations (SGP) on itspotential bid for DTZ, and helpedFairfield Energy, a North Sea oilexploration company, with a failedbid to launch an initial public offer-ing on the London Stock Exchangelast year.

MEET THE ADVISERS

LAWRENCE

GUTHRIE

HAWKPOINT

PARTNERS

8/4/2019 Cityam 2011-10-07


ACTIVIST investor Edward Bramson isexpected to slash costs at F&C AssetManagement after the departure of the chief executive, his rival, cement-ed his control of the group.

Bramson, who won a bitter board-room battle to lead the board of F&Cin February, was yesterday namedexecutive chairman after chief execu-tive Alain Grisay decided to retire, adecision blamed by analysts on con-flicts between the two.

F&C said Bramson has taken inter-im control with “immediate effect”.Grisay, 58, who had sold his shares inthe fund, will gradually relinquishhis responsibilities before steppingdown from the board at the annualgeneral meeting in May. He willremain available as an advisor untilthe end of September.

David McCann at Numis said thedecision was unsurprising given the“historical difference of opinion”

between the executives. According to Alan MacDougall,

managing director of shareholdergroup Pirc, the reshuffle “raises morequestions than it answers.”

Bramson, whose SherborneInvestors has a stake in F&C of nearly 20 per cent, ousted chairman Nick MacAndrew and veteran directorBrian Larcombe in February and wonplaces on the board for himself,Sherborne chairman Ian Brindle andindependent Derham O’Neill.

He is now leading a review of F&C,driven by Sherborne’s strategy of turning around underperformingcompanies. The Foreign & ColonialInvestment Trust from which F&C isfounded is the oldest in the world butit has disappointed investors inrecent years. Sources said, however,that there had been no bust-up

between the two men and they wouldspend 15 months working together

before Grisay’s departure.

Cuts loom at

F&C as Grisaysteps down

VASANTA, the office supplies busi-ness propped up by private equity inthe aftermath of the financial crisis,has narrowed its annual losses.

The firm, which survived in July 2009 after Endless injected £30m of new equity alongside the company’s

bank group, reported an operatingloss of £1m for 2010, down 64 per

cent from £2.8m in 2009, accordingto accounts published this week. Turnover fell 12 per cent to £385m

as it chose to stop working on lessprofitable accounts.

Garry Wilson, partner in turn-around specialist Endless, told City A.M. he has focused on cash flow but Vasanta was now increasing prof-itability after cutting its less lucrativeaccounts.

He expects turnover this year to be

similar to that of 2010. Two years ago Vasanta’s debt wascut, and private equity house Electra

wrote off its investment and walkedaway from the business.

Wilson also said there are stillopportunities for Endless to makeacquisitions this year as more of Britain’s highly leveraged buyouts getinto trouble. The fund has £40m to£50m available to spend in the finalquarter of the year.

Private equity house Endlessleads turnaround at Vasanta

BY PETER EDWARDS

FUND MANAGEMENT▲

BY PETER EDWARDSPRIVATE EQUITY▲


Grisay: set to retire next year Bramson: new role of executive chairman

ANALYSIS l F&C Asset Management

p


65.00

60.00

60.156 Oct

TIME LINE | TEN MONTHS OF BOARDROOM STRIFE AT F&C

16 December 2010Sherborne launches bid to remove NickMacAndrew from the board

25 January 2011Alain Grisay tells Sherborne that signs of clients returning shows its strategy isworking

3 February 2011MacAndrew is ousted as F&C chairman at ashareholder meeting and replaced by NewYork-based Bramson

16 March 2011Grisay sells one million F&C shares

4 April 2011

It emerges that Edward Bramson’sGuernsey-domiciled Sherborne Investors has

bought 2.65m F&C shares since mid-March,giving it a stake of nearly 20 per cent

15 June 2011F&C says Grisay has sold 500,000 sharesworth £381,750

3 August 2011F&C beats analysts’ expectations when itsays assets under management have risen to£108bn in the first-half, up 13.3 per centfrom June 2010

6 October 2011Grisay announces he will retire as chief exec-utive the following May

25 October 2011

F&C board due to publish results of itsstrategic review

8/4/2019 Cityam 2011-10-07


SERVICE sector output edged higher in July, marking a tepid start to the thirdquarter, official data showed yesterday.

Small rises were recorded in busi-ness services, finance and governmentactivity.

The Office for National Statistics(ONS) said service sector output rose by 0.2 per cent in July after a 0.3 per centcontraction in June. Annualised, out-put was 1.3 per cent higher.

The economy as a whole grew by

just 0.1 per cent in the three monthsto June -- largely due to the weakestservice sector growth since the end of 2010, ONS data has showed.

Yesterday’s figures gave only limitedhope of a pick-up. Output in the threemonths to July grew by 0.9 per cent, its

biggest increase since November 2007, but that was due to a rebound in May from the slide in output caused by theprevious month’s royal wedding.

July’s reliance on governmentspending to drive growth may also be

a concern, given the determination of the coalition to slash the country’shefty budget deficit.

Separately, the ONS also reportedthat productivity across all sectors of the economy flatlined in the secondquarter, repeating the first quarter’sunchanged reading.

This pushed the annual rate of growth in output per worker into neg-ative territory -- down 0.2 per cent onthe year -- for the first time since thethird quarter of 2009. ONS datareleased last month showed thatBritain’s productivity had already fall-

en well below the average for the G7group of advanced economies in 2010.

The slowdown in productivity growth was driven by a 0.5 per centquarter-on-quarter fall in the produc-tivity of the industrial production sec-tor, which includes the North Sea oiland gas industry, where output hasrecently been suffering.

Unit labour costs remained incheck, however, up just 0.3 per cent onthe quarter after a 0.4 per cent rise inthe first quarter of the year.

Slow start tothird quarterfor services

NEW private car registrations plum-meted by 9.3 per cent in September,compared to the same time last year.

“The outlook for car manufactur-ers looks increasingly worrying withthe economy struggling markedly,and consumer and business confi-dence low,” commented economistHoward Archer of IHS Global Insight.

Overall, however, the figures

exceeded expectations, with a surgein sales of fleets of cars. Total car sales

were down just 0.8 per cent, proppedup by high fleet sales.

Sales volumes from January toSeptember are five per cent down onthe same time last year, the Society of Motor Manufacturers and Traders(SMMT) revealed. Yet the fall in thethird quarter slowed to 0.7 per cent,helped by strong figures in August.

The SMMT expects 1.92m new carsales throughout this year.

Falling car registrationsoffset by high fleet sales

Private car registrations were down 9.3 per cent last month Picture: REX

BYHARRY BANKS

UK ECONOMY▲


BY JULIAN HARRISINDUSTRY▲

NEWS | IN BRIEF

German industrial orders dropGerman industrial orders fell unexpect-edly in August on a decline in domesticdemand, data from the economy min-istry showed yesterday, adding to signsof a slowdown in Europe’s largest econo-my. Seasonally- and price-adjusted orderintake sank 1.4 per cent on the month,

driven by a 3.2 per cent drop in domesticorders. The mid-range forecast in aReuters poll of 41 economists was for anincrease of 0.3 per cent. The ministryrevised July's figure up slightly to a 2.6per cent drop, having originally reporteda 2.8 per cent fall.

Dutch inflation climbs againStubborn inflation in the Netherlandsrose again last month, according to fig-ures released yesterday. The country’sconsumer price index increased to 2.7per cent annualised, above expectations.The rate of CPI inflation had held at 2.6per cent in August.

Franc cap sees SNB reserves riseForeign exchange reserves held by theSwiss National Bank rose by 29bn Swissfrancs (£20.4bn) in September, themonth it began defending a currencycap on the soaring franc, though it said

money market injections accounted formost of the rise. Reserves rose to282.35bn Swiss francs, according to theSNB figures released yesterday. Thedata sent the franc sharply lower asmarkets responded to signs the bank'saction in the currency market to cool thesafe-haven currency had been relativelylight, though one analyst suggestedheavier interventions might be needed if the economic backdrop worsened. TheSNB set a cap of 1.20 Swiss francs pereuro on the currency on 6 September.

8/4/2019 Cityam 2011-10-07


VOLATILITY continued in the hous-ing market, with September’s pricefalls reversing gains seen in Juneand July, the Halifax index revealed

yesterday.Prices are down 0.5 per cent com-

pared with August and 2.3 per centover the last 12 months, the season-ally adjusted figures show.

The rate of decline has slowedfrom its peak of 4.6 per cent in the

year to May.However, prices did increase by

0.1 per cent over the third quarter,and the annual pace of decline is atits lowest since December 2010.

The average price of a UK housesold in September stood at £161,132,down from £162,307 in the samemonth last year.

The study said mortgage pay-ments account for 26 per cent of anew borrower’s disposable income,down from 48 per cent in mid-2007.

In terms of sale volumes, around70,000 were sold last month, in line

with the average for 2011.Halifax believes that gradual

employment growth over the year

combined with low interest rateshave supported the market – butthat negative factors are also weigh-ing on house prices.

“Greater uncertainty about eco-nomic and personal financial cir-cumstances, together with pressureon householders’ finances from

weak earnings growth, higher infla-tion and increases in taxes, are like-ly to be constraining housingdemand,” explained Halifax econo-mist Martin Ellis.

“We expect little change to thissituation over the remainder of 2011.”

However, estate agents believethere is more reason for some opti-mism.

“Halifax’s figures point to a rathergloomy outlook for the nationalhousing market in September, butthere are certainly signs of life,” saidPeter Rollings from estate agentMarsh and Parsons.

“Mortgage lending has picked-upin recent months, and the currentprice war between lenders is mak-ing mortgages increasingly afford-able. Lending has never beencheaper for those who have already saved up for their deposits.”

House prices

decline againin September

MORTGAGE rates on high loan-to- value deals have sunk to their lowestpoint since January 2008.

Loans worth 90 per cent of the value of the acquired property areavailable at an average of 5.39 percent on a fixed two year rate, the web-site Moneyfacts has claimed.

The average rate has tumbled from

6.05 per cent on the same deal sixmonths ago, as global economic woesappear to have stamped out any chance of the Bank of England raisinginterest rates in the near term.

A five year mortgage of 90 per centloan-to-value can be obtained at anaverage rate of 5.87 per cent, the dataalso showed – a whole percentagepoint lower than the typical interestrate six months earlier.

“The availability of higher loan-to-

value mortgage products hincreased over the past couple of years,” said Louise Holmes oMoneyfacts.

“Lenders have begun to launchmore competitive products to borrow-ers who during the height of the cred-it crisis had pretty much given up onthe prospect of owning their ownproperty,” she added, warning thatrates would likely rise at the first signof a higher Bank rate.

Fixed mortgages sink to theircheapest rates for 45 months

BY TIMWALLACE

PROPERTY▲

BY JULIAN HARRIS

ECONOMICS▲


ANALYSIS l House price/Earnings ratio

Source: Thomson Reuters Datastream

1985 1990 1995 2000 2005 2010

6.0

5.5

5.0

4.5

4.0

3.5

3.0

*Ratio of the Halifax standardisedaverage price of All Houses tonational average earnings forfull-time male employees

Average

Halifax UK house price index- price/earnings ratio*

The Halifax index suggested that the pace of decline eased slightly last month REUTERS

8/4/2019 Cityam 2011-10-07


A SURGE in petrol prices has furtherdented sales at Halfords as cash-strapped drivers are forced off theroad.

The retailer said like-for-like salesfell 2.8 per cent in the 13 weeks to 30September, compounding a 1.1 percent drop in the previous threemonths.

Sales of car maintenance products were down 3.3 per cent.

However, this drop was partly off-set by a 5.7 per cent rise in bike salesas people took up cycling to work, while the recent success of Britishcyclists such as Mark Cavendishhelped boost premium racing bikes.

The retailer has warned that grossmargins will be down by one percent-age point this year following a seriesof promotions aimed at triggering arise in sales.

Half-year profits will be between£53m and £55m, down from £68.7m

last year, the company said.Chief executive David Wild said:“The cost of motoring is a burden on

motorists and people are looking tosave money by driving less or defer-ring services.”

Halfords said its Autocentres carmechanic business saw like-for-likesales growth of 2.7 per cent withstrong demand for servicing andtyres. But it said first half operatingprofits at the business, which it bought from Nationwide Autocentreslast year, will be lower than in 2010.

There has been a five per cent dropin petrol sales volumes in the UK inthe half year, according to AA figuresout this week.

But shares in Halfords closed morethan eight per cent up yesterday.

Halfords hitby soaringprice of fuelBY JOHN DUNNE

RETAIL▲


Halfords chief executive David Wild hopes bike sales can offset a fall in car spending

NEWS | IN BRIEF

ICG attracts €1.1bn to new fundBuyout funder Intermediate CapitalGroup yesterday said it has raised €1.1bnat the first closing of its new Europefund, well on the way to its €2bn target.Around €500m came from the firm’sinvestment company. ICG said in a trad-ing update that its mezzanine funds areperforming well compared with privateequity funds, and that its investmentportfolio is holding up amid the marketturbulence. The firm’s shares closed upalmost eight per cent at 214p.

TNT Express warns on profitsDutch freight and delivery firm TNTExpress issued a profit warning yester-

day as the global economic slowdown ledmore customers to snub air transport infavour of cheaper shipping. TNT Express,which listed in May after it split fromDutch mail group PostNL, cut its 2011outlook and said it saw revenue pressurein Europe, the Middle East and Africa inthe third quarter.

Ferrexpo pellet production risesUkrainian iron ore producer Ferrexpo saidtotal production of pellets in the third-quarter was slightly higher than lastyear, helping send the firm’s shares up 10per cent. Total pellet output rose about

1.5 per cent to 2.33m tonnes in the thirdquarter, the company said yesterday.

ANALYST VIEWS: IS HALFORDS ON THE RIGHT PATH? By John Dunne

“It is disappointing to see profits

under-shooting at the Autocentre business, butwe are holding our full-year group profit beforetax forecast at £99m, after a solid quarter twoin the core business. Having expected to haveto downgrade again, we are relieved by today'snews and so, despite the rather bleak outlookfor consumer spending, we are upgrad-ing from Neutral to Add.

”

“

KEITH BOWMANHARGREAVES LANSDOWN

In all, a drive to offer consumers morevalue-orientated car maintenance providespotential, its spare parts business is still con-sidered defensive, whilst exposure to low costtransport (bicycles) and holiday (camping)options is seen as catering for embattled con-sumers. Bolstered by the group’s ongoing sharebuy-back scheme, market consensusopinion currently denotes a hold.

”

“

MATTHEW MCEACHRAN | SINGER CAPITAL MARKETS

They are part way through a £75m buyback programme. We continue to believe that Halfords remains a fun-damentally sound business with domestic growth opportunities, however the key catalyst in our mind will be in relationto strengthening the operational management team and improving the customer experience.

”

ANALYSIS l Halfords

p


305

295

285

303.006 Oct

NICK BUBBARDEN PARTNERS

8/4/2019 Cityam 2011-10-07


HIGH street baker Greggs yesterday reported a rise in sales growth in thethird quarter despite the squeeze onconsumer spending.

Like-for-like sales rose 0.8 per centin the 13 weeks to 1 October, the com-pany said in an interim managementstatement.

That compares with a rise of 0.4 percent in the first half to 2 July, and acompany forecast of “marginally posi-

tive” like-for-like sales growth for thefull year.

Greggs, which sells bread, sand- wiches, savouries and cakes to over6m customers a week from 1,540shops, said it had continued to seegood growth in breakfast sales.

Greggs is launching frozen sausagerolls in more than 700 Iceland storesat £1.50 for a pack of four.

Chief executive Ken McMeikansaid: “We have always felt there weremore opportunities for us in the take-home market.

“We tested the frozen sausage rollsin 10 Iceland stores for three months.

“It was important to make surethere was no cannibalisation of salesfrom our own nearby outlets.”

The other big success has been“Superstar Doughnuts”, 1.4m of

which have been purchased in thefive weeks since they were launched.

Greggs also said it had recorded the biggest takings for a store opening when the baker opened the doors of its Westfield Stratford City shop ineast London last month.

McMeikan said he was very pleased by the rise “given the tough trading

conditions”. He added that most raw material prices, notably flour, hadstabilised recently, but sugar has goneup sharply.

Greggs is ona roll as salesgrow again SUPERMARKETS, banks and other

high street stores are now able tooffer legal services to their customers,after a new law to liberalise the UK’slegal sector came into force yesterday.

The Legal Services Act, dubbed the Tesco law, introduces the idea of alter-native business structures (ABS),

which allow law firms to seek outside

investment, and to be owned by non-lawyers.“This is a landmark day for the UK

legal industry,” said justice minister Jonathan Djanogly.

“Our legal services are already rated among the best in the world,used by millions of people around theglobe as well as in the UK, and thesechanges will set them up to move tonew heights. They will enable firmsto set up multi-disciplinary practices

and provide opportunities forgrowth.”Leicester-based Premier Property

Lawyers became the first ABS in theUK yesterday, after it was granted alicence by the Council of LicensedConveyancers.

And Oxford’s Everyman Legal will be the first solicitor to try to accessthe UK stock markets, announcing

yesterday plans to float on small com-panies index Sharemark next year.

Legal market overhaul startsas Tesco law comes into force

BY JOHN DUNNE

RETAIL▲

BY ELIZABETH FOURNIERLEGAL SERVICES▲


TED BAKER BUCKS HIGH STREET GLOOM

British designer clothing

brand Ted Baker yesterday posted strong first-half results led by growth in itsoverseas and online businesses, and raised its inter- im dividend 13.5 per cent.The fashion retailer, whichbegan as a menswear brand in Glasgow in 1987,said for the 28 weeks to 13 August, pre-tax profits roseto £8.5m from £7.5m last year. Revenue grew 17 per cent to £102.8m.The company said it remained cautious on thesecond half considering economic headwinds hit- ting the retail sector.

Picture: GETTY IMAGES

ANALYSIS l Greggs

p


485

475

465

483.206 Oct

Cranswick is boosted byshoppers’ switch to pork

SAUSAGE specialist Cranswick hasseen an increase in pork sales as con-sumers switch to cheaper meats.

The group, which issued a profits warning in July, said the versatility and relatively low price of pork arekey to this positive trend. It added

that the growing popularity of pork products has been a contributory fac-tor to a recent increase in sales atCranswick.

Underlying sales volumes in thefirst quarter covering April, May and

June grew by three per cent and rose by seven per cent in July, August andSeptember.

CONSUMER▲

8/4/2019 Cityam 2011-10-07


LOW-COST carrier easyJet has unveiledplans to open two new bases in Francenext year, stepping up the competition

with the nation’s flagship carrier AirFrance-KLM.

EasyJet announced yesterday it willadd two Airbus 319 aircraft in Niceand Toulouse airports, bringing theairline’s number of French bases tofive – with the other three beingCharles de Gaulle and Orly airports inParis and Lyon.

The move comes just months after Air France announced it would“launch the offensive” against budgetairlines and operate a regional low-cost model to claw back 4m customers.

The French airline opened a base inMarseille earlier this month and plansto offer flights from other citiesincluding Nice and Toulouse, but isstill in negotiations with the unions.

EasyJet grew its capacity in France by 22 per cent last year compared to wider market growth of one per cent,

according to its annual report. The air-line added that it had taken advantageof Air France cutting its capacity onroutes such as Madrid and Barcelona.

“France is a strategic market foreasyJet, where the airline – already thecountry’s second largest – clearly hasroom to grow,” Catherine Lynn,easyJet’s customer and revenue direc-tor, said in a statement.

EasyJet’s passenger numbers rose8.5 per cent in September compared tolast year, it also said yesterday. Its loadfactor rose 0.3 percentage points to89.6 per cent.

EasyJet looksto open newFrench bases A SCHEME that would force all foreign

airlines to pay for their greenhouse gasemissions “is compatible with interna-tional law”, an adviser to the bloc’s topcourt has said, in response to a chal-lenge by North American airlines.

The opinion, issued yesterday by theadvocate general at the EuropeanCourt of Justice in Luxembourg, marksa preliminary victory for the EU in itsattempts to extend its cap-and-tradeprogramme beyond its borders from

January. The opinion by Juliane Kokott will

come as a blow to the UnitedContinental and American Airlines,

who have brought a case against an EUplan to make any carriers taking-off orlanding in the 27-member bloc pay fortheir emissions.

Though the court will not rule until

next year, it follows the advocate-gen-eral’s opinion in most cases.

Expressing disappointment, theInternational Air Transport

Association (IATA), the industry body,said that the opinion “does not mark the end of the case”.

“Rather than risking a further esca-lation of tensions amongst states, Iencourage Europe to support a success-ful, global and effective solution,” said

Tony Tyler, director general of theIATA.

AUSTRALIAN airline Qantas said yesterday that it had finalised anorder for 110 single-aisle Airbusplanes following a commitment forthe aircraft signed in August.

The carrier announced a firmorder for 78 of Airbus’ next genera-tion A320neo jets, along with 32

A320 planes, adding that it willdecide on which engine to use with

the planes at a later date. Airbus has sold fewer planes than

Boeing in September but main-tained a strong advantage over itsUS rival in the first nine months of the year after setting the pace inthe market for narrowbody jets

The European planemaker said itsold 23 aircraft last month, bring-ing its order total for the year to1,179 passenger jets. Net orders,adjusted for cancellations, stood at1,038.

US airlines setto lose over EUcarbon cap plan

Qantas signs deal for 110more A320 Airbus planes

Qantas boss Alan Joyce has bought more than 100 new planes Picture: REUTERS

BYKASMIRA JEFFORD

TRANSPORT▲

TRANSPORT▲


BYHARRY BANKSTRANSPORT▲

ANALYSIS l Easyjet

p


350

340

347.006 Oct

8/4/2019 Cityam 2011-10-07


8/4/2019 Cityam 2011-10-07


OIL producer Exillon Energy said itfound oil at a Russian well, and would connect it to the existingproduction facilities following test-ing.

The London-listed company saidit found 15.5 metres of net oil pay –referring to the zone of a reservoirthat contains economically pro-ducible oil – at its EWS I-43 well inthe south-eastern part of the EastEWS I field in West Siberia.

“The well flowed water-free oilnaturally to the surface with a flow rate of 595 barrels per day,” thecompany with assets in two oil-richregions of northern Russia, Timan-Pechora and West Siberia, said in astatement.

Last month, the company found7.3 metres of effective net oil pay atits EWS I-44 well in the sameregion.

The firm has drilled 15 wells inthe region this year, and is building

a connection to the Transneftpipeline, a state-owned project thatsends oil from Siberia to the Baltics.

The firm said in August that itsdrilling efforts are well-funded, with a cash pile of $152.7m (£99m)following a new share issue in April.

Exillon shares, which have lostmore than half their value over thelast three months, shot up morethan 22 per cent yesterday to 234pon the London Stock Exchange, valuing the firm at around£308.8m.

Exillon findsextra oil inWest Siberia

SHARES in oil and gas explorer Aminex plummeted more than 40per cent yesterday after the company

said it had suspended work on itsexploration well off the coast of Tanzania.

The company blamed “extremedrilling conditions” due to obstruc-tions at the base of the well bore forthe problems.

Despite the hold up, Aminex saidthe Nyuni prospect was still one of its“prime exploration targets”.BYHARRY BANKS

ENERGY▲

ENERGY▲

ENCORE Oil, which was sold at a 55

per cent premium yesterday toPremier Oil, said its last trading yearhad been “successful and satisfying”.

During the year, EnCore completedtwo exploration wells in the Catcheroil discovery area, and expanded itspresence in the North Sea.

EnCore posted a loss of £2.5m, com-pared to a profit of £11.4m in the prior year, which was largely due to sale of the Breagh gas asset. Without thatsale, EnCore lost £11.5m in the year to June 2010.

EnCore heraldssuccessful yearENERGY▲


ANALYSIS l Exillon Energy

p


240

220

200

234.106 Oct

Aminex slumpsas well is shut

BEST OF THE BROKERS

To appear in Best of the Brokers email your research to [email protected]

PERNOD RICARDJP Morgan rates the drinks giant as “over-weight” with a target price of €71, ahead of a first quarter sales report on 20 October.The broker forecasts sales of €1.95bn versusa company consensus of €1.91bn, and organicsales growth of 5.6 per cent for 2012 against

a consensus of 6.1 per cent. Sales are expect-ed to be more muted in the Americas andEurope, with lower gross margin expansionseen as a result.

ANALYSIS l The Swatch Group

425

400

375

350

325

300

Aug Sept Oct

CHF

326.406 Oct

SWATCHMorgan Stanley rates the watch group as“underweight” with a target price of CHF342, and says the stock’s risk-reward isturning less favourable given the risks of the wholesale channel, and deterioratingmid-tier luxury demand. The brokerassumes sales within Swatch’s watch and jewellery division will fall seven per cent in2012, but says the stock remains inexpen-sive compared to its sector peers.

ANALYSIS l Rightmove PLC

1,300

1,250

1,200

1,150

1,100

1,050

1,000

Aug Sept Oct

p1,214.00

6 Oct

RIGHTMOVEGoldman Sachs downgrades the estate

agent and developer to “neutral” from“buy” following the stock’s recent outper-formance, and sees better opportunitieselsewhere in the sector. The broker expectsaverage revenue per advertiser to reach£440 for 2011, and £500 in 2012. It fore-casts underlying operating margins toprogress to 70.3 per cent in 2011 and 71.6per cent in 2012.

68

70

66

64

62

60

58

ANALYSIS l Pernod Ricard

Aug Sept Oct

€ 62.096 Oct

8/4/2019 Cityam 2011-10-07


Fuel consumption for the Honda range in mpg (l/100km): Urban Cycle 22.2 – 61.4(12.7 – 4.6), Extra Urban 38.2 – 67.3 (7.4 – 4.2), Combined 30.7 – 64.2 (9.2 – 4.4).

CO2 emissions 2 5 - 101g/km. Models shown Jazz 1.2 i-VTEC S Manual, CR-V 2.0 i-VTEC EX Manual and Civic 1.4 Sii-VTEC Manual. Offers valid on new retail models ordered (excluding Civic Ti and Jazz Hybrid) registered on or before 31 December 2011.

Offers applicable at participating Dealers and are at the Promoter’s absolute discretion. Subject to model, colour and stock availability. onda

Hire Purchase (HP): Indemnities may be required in certain circumstances. Finance is only available to persons aged 18 or over, subject to

status. All figures are correct at time of publication but may be subject to change. Promoter is Honda (UK), 470 London Road, Slough, BerkshireSL3 8QY. Servicing: Four years complimentary servicing or 50,000 miles, whichever comes first, and includes a maximum of four services.

Complimentary servicing covers the manufacturer’s scheduled servicing only. oadside Assistance: Covers the vehicle and authorised

drivers for four years emergency breakdown, subject to the vehicle being maintained in accordance with the manufacturer’s servicing schedule.

4 years free servicing

4 years free roadside assistance

4 years 0% APR Representative

For surprisingly lowmonthly payments

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FIND YOUR

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NEWS | IN BRIEF

Rusal completes debt refinancingUC Rusal said yesterday it had finishedrefinancing its $11.4bn (£7.4bn) debtportfolio, finally freeing it from restric-tions on investments and dividend pay-ments imposed by a restructuring deal.The firm, Russia's most indebted at thetime of the 2008 credit crunch, said ithad used a recently agreed new loan topay off $4.34bn still owed to foreigncreditors under its landmark restructur-ing deal with over 70 lenders. The repay-ment was made with a $4.75bnsyndicated loan arranged with a pool of 13 banks. The terms of the restructuring

imposed limits on Rusal's managementof financial resources.

Eni upbeat over Libyan plantsItalian oil firm Eni said yesterday its oiland natural gas plants in Libya are notdamaged and it expects to have produc-tion levels there back to pre-conflict lev-els in about a year. “We are workingclosely with NOC and will be back topre-crisis levels in 12 months,” Eni chief executive Paolo Scaroni said on a confer-ence call with analysts. Scaroni said pro-duction at the group's Abu Attifel field inLibya has now reached 70,000 barrelsper day – a level close to that seenbefore the civil war. In September Enisaid it had restarted production at Abu

Attifel at around 32,000 barrels of oilper day.

London 2012

IMAGE OF THE WEEK

GB archer Amy Oliver joined theworld’s best archers this week forthe London Archery Classic at Lord’s.

Between now and the start of the 2012 Games, City A.M. is publishingits Olympic Image of the Week. We

welcome photographs from all sources – sponsors, athletes, local businesses, commuters and local res-idents. Please email us at

[email protected] with IOW2012 in the subject line. Full details: cityam.com/london-2012.

ARCHERY TEST EVENT | LORD’S CRICKET GROUND

CITIC Securities, China’s largest list-ed brokerage, made a weak debut inHong Kong yesterday, underscoringpoor appetite for new share sales inthe face of global market volatility.

Its stock fell as much as 10.5 percent before closing unchanged,

while the broader Hong Kong indexended up nearly six per cent.

The disappointing start for CiticSecurities, which raised a less-than-expected $1.7bn (£1.1bn) in its firstlisting outside the mainland, coulddash the hopes of other Chinesefirms planning to raise funds inHong Kong, the world’s biggest IPOmarket for the past two years.

The offering is the first of nearly $35bn in share sales in Hong Kongand China still planned in the com-ing months by financial companies,

including Haitong Securities, New China Life and China GuangfaBank.

“It’s a very difficult time for any IPO because market sentiment is so

weak right now,” said Patrick Yiu, adirector at CASH AssetManagement. “Investors want tolook for stocks now with a track record with very low valuations.

They don’t have the appetite fornew stocks.”

Citic fails to impress as itsshares float in Hong KongBYHARRY BANKS

FINANCIAL SERVICES▲

BRITISH bank HSBC Holdings andOman International Bank are in dis-cussions for a potential merger of HSBC’s Oman operations with theGulf lender, OIB said in a statement

yesterday.“These discussions are ongoing

and no decision has been made as to whether to recommend proceeding

with any transaction,” OIB said in a bourse statement.HSBC, which has operated in

Oman since 1948, has five retail branches in the sultanate.

The head of its securities business was quoted by Omani media this week as saying the British lenderhad a long-term commitment toOman and the Middle East. Sharesin HSBC closed up 5.1 per cent yes-terday.

HSBC in talks withOman InternationalBY ELIZABETH FOURNIER

BANKING▲

8/4/2019 Cityam 2011-10-07


As part of our You are theBig Picture campaign, we’re

not only giving peoplelike Laura the chance to see

their picture projected live

on to London’s National Theatre,we’re also giving them the opportunityto tell the world what matters to them.

In return, we’ll donate £2 toSave the Children projects helping street

children in India.

Upload your photo atfacebook.com/Aviva

Laura Seddon, Coventry

8/4/2019 Cityam 2011-10-07


Discoveries A product of Lufthansa.

*Fare applies to one-way flights to selected destinations in Germany and Italy; seat availability is limited and subject to change.For other European destinations, please check the respective fares and conditions.

Over 100 fascinating

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Kames CapitalJonathan Taylor has been appointed tothe new role of business developmentand consultant relations managerwithin the institutional sales team.Taylor joins from Tokio Marine AssetManagement, where he was vice presi-

dent in the London office.

McQueenThe specialist corporate finance advis-er has made four new hires. GarythStone and Patrick Mewton join thefood and drink team from Rabobank,Ashish Burman joins the retail team

from Mezzanine Capital, and independ-ent consultant John Richards has beenappointed as a retail consultant.

RBC Wealth ManagementRBC Wealth Management has estab-lished a new London-based Eastern

European desk by appointing JustynaJackholt as a director. Jackholt joinsfrom Clariden Leu, where she was avice president in the London office.

PwCRichard Abadie has been appointed asglobal leader of PwC’s capital projects

& infrastructure practice. Abadie, apartner based in the firm’s Londonoffice, succeeds Carter Pate, who hasrecently retired from the firm.

JupiterRobert Mumby, a financial manager at

Jupiter, will take over as manager of theJupiter international financials fundfrom Philip Gibbs on 31 October. Guy deBlonay becomes deputy manager of theJupiter international financials fund andthe global financials fund, and RobertMumby becomes deputy manager of the Jupiter financial opportunities fund.

CITY MOVES | WHO’S 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

Signia WealthShalini Khemka has been appointed asa managing director to develop thewealth manager’s private equity armand expand the business overseas.Khemka will continue as CEO anddirector of The London Entrepreneurial

Exchange, which she co-founded in2010 while working as an investmentbanker at LDC, the private equity armof Lloyds Banking Group. Prior to join-ing LDC, Khemka led a team in theinternational trade finance business of Lloyds Banking Group.

BRITAIN’S top shares advanced

yesterday as sentiment was lif t-ed by hopes policymakers willtake the necessary measures to

stabilise stressed European banks and by the Bank of England’s decision tolaunch a second round of quantita-tive easing.

“Central banks have come to theparty and said ‘look, we’re really con-cerned about growth; we’re going totake steps to boost the economy, orsupport the banking system,” saidMichael Hewson, analyst at CMCMarkets.

“I think that tells investors thatthere is some sort of consensus form-ing,” he said.

Financials were among the topgainers. Prudential lurched almost 12per cent to the top of the FTSE 100leader board, while StandardChartered and Lloyds Banking Groupenjoyed near nine per cent gains.

The FTSE 100 closed up 189.09points, or 3.7 per cent, at 5,291.26,eradicating losses sustained in thefirst two trading days this week.

Miners gained in tandem with base

metals as investors took heart fromUS data that hinted at an improve-ment in the labour market.

Antofagasta and ENRC, up 10.2 percent and 9.7 per cent respectively, were the top performers in a sector which has lost almost a third of its value in 2011.

Industrials IMI and Weir Group,sensitive to the economic cycle,enjoyed respective gains of 11.5 per-cent and 6.6 percent.

Elsewhere, brewer SABMiller jumped seven per cent, in volumesmore than four and a half times its90-day daily average, on Brazilianpress reports that Anheuser-BuschInBev is set to make an $80bn moveon the brewer.

On the downside, Man Groupslipped 1.2 per cent, topping the blue-chip fallers’ list, in the wake of thehedge fund manager’s recent disap-pointing trading update.

FTSE lurches up on

economic optimismTHELONDONREPORT

11 Jul 29 Jul 18 Aug 28 Sep8 Sep

6,200

5,400

5,000

5,800

ANALYSIS l FTSE

5291.266 Oct

US stocks rose for a third day in arow yesterday as developingEurozone plans to backstopEuropean banks gave investors

hope the threat of a financial crisis was waning.

Bank shares led gains on Wall Street

as the EU planned to recapitalise banks and the European Central Bank

said it was ready to buy bonds to provide longer-term cheap money forEuropean lenders in need of funding.

The S&P Financial Sector gained 3.2per cent and has risen 8.8 per cent inthe past three days, though it remainsone of the weakest sectors this year.

The Dow Jones industrial averagerose 1.68 per cent to 11,123.33. TheS&P 500 gained 1.83 per cent to1,164.97. The Nasdaq Compositegained 1.88 per cent, to 2,506.82.

“We’re popping back up again, based on the idea they [European offi-cials] will reach an agreement and res-

cue us,” said Doug Roberts of ChannelCapital Research.

Europe lifts Wall Stfor a third sessionTHENEWYORKREPORT

8/4/2019 Cityam 2011-10-07


THE Apple.com homepage, one of themost valuable pieces of virtual realestate in the world, yesterday featured just one black and white photograph,alongside the words: “Steve Jobs 1955-2011”.

The death of the iconic leader of the world’s biggest technology company was met with an outpouring of grief usually reserved for musicians and world leaders. Chief executives, devot-ed fans and US President Barack Obama were among those to pay theirrespects after his tragic death at theage of just 56. iPhones showing his pic-ture were left alongside the more tra-ditional flowers and candles outside Apple Stores across the world.

Jobs’ impact on technology, and itsimpact on him, is unique to his gener-ation. He grew up as the personal com-

puter market was becoming a reality for Americans. Through Apple, NeXT

and Pixar, he helped to shape the way we think about and interact with tech-nology. He worked on the first wave of consumer operating systems and hada ringside seat as the internet evolvedfrom a lab to become the dominantform of mass communication. Apple was a part of Steve Jobs as much asSteve Jobs was a part of Apple.

He grew up in Cupertino, where he would later base his world-conquering Apple empire, with his adopted par-ents (he never met his biological fatherand was estranged from his biologicalmother). He met Apple co-founderSteve Wozniak while working at HP,going on to build their first computerin his parents’ garage using money from the sale of Wozniak’s van.

Jobs was a hard task master – hedemanded the same perfection in oth-ers as he aimed for himself. Those whohave worked for him often describethe experience as an emotional roller-

coaster, with the lows coming in equalmeasure to the highs. Jobs’ determina-

tion soon made Apple a commercialsuccess – its IPO created moreovernight millionaires than any other before it. But just five years after goingpublic, Jobs was forced out after a spat with the chief executive he had per-sonally wooed from Pepsico.

Jobs’ achievements during his 12 year absence – during which Apple veered close to bankruptcy – are asastonishing as his accomplishments with the company. NeXT, the comput-ing firm he founded, shaped the mod-ern user interface. Pixar, which nettedhim the majority of his fortune,changed the direction of cinema. Thestory after he rejoined Apple is thestuff of modern legend – iMac, iPod,iPhone, iPad – culminating in Apple becoming – briefly–the biggest firm inthe world. Through an uncanny knack of understanding what people want before they knew they wanted it, Jobstransformed not only computing but

music, film and publishing. Jobs’death is a huge loss –not only to Apple.

Steve Jobs, 1955-2011BY

STEVE DINNEEN

TECHNOLOGY▲

Focus on Steve Jobs24 CITYA.M. 7 OCTOBER 2011

A talismanic leader who leaves the world a richer placeIT'S OFTEN said that Steve Jobs didn’tgive a fig about maximising share-holder value. Considering how goodhe was at it, it scarcely matters. When he rejoined Apple in 1997, itsstock was worth $5-a-share while itsmarket cap – mostly accounted for by cash and other tangibles – was a whisker under $5bn. Now worthalmost $350bn, it jockeys for theposition of the world’s biggest com-pany. Since 1997, Jobs has increasedthe value of the company by almost7,000 per cent.

Then there was Pixar, the anima-tion studio that listed in 1995 at $22-

a-share, valuing it at $2.7bn. Just over

a decade later, he sold it to Disney for$7.4bn, giving shareholders a premi-um of 171.2 per cent. Since then,Disney’s stock has continued to rise while rivals flounder, in large partdue to the success of the Pixar fran-chise.

Even when Jobs wasn’t directly involved, he was helping to makeother people millionaires. Withoutthe iPhone, the smartphone revolu-tion would have been much lesstransformational. Samsung might be suing Apple over patent disputes, but there is no way it would havesold 19m smartphone handsets in

the second quarter if the iPhone had-

n’t come first. The explosion inmobile data would have had beenmuch less seismic. Vodafone would-n’t have booked £1.4bn of data rev-enues in 2011; and total datarevenues would not be forecast torise to a staggering $440bn by 2015.

Then there are the scores of “AppStore millionaires”, making their for-tune by selling games and apps to Apple customers. Everyone agreesthat Jobs made the world a richerplace – in more ways that one.

BOTTOMLINEAnalysis by David Crow

ANALYSIS l Apple inc

1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 20

340

360

380

320

300

280

260

240

220

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180

160

140

120

100

80

60

40

20

0

APPLE GOES PUBLIC

Jobs takes the firm he co-founded public. Its sharesrise by a third during theirfirst day trading

FORCED OUT OF APPLE

After a tussle Jobs is turfedout of the company, withJohn Sculley now in charge

JOBS FOUNDS

NeXT

He starts rival com-puter firm, whichwill design thebasis for Apple’s OS

APPLE BUYS NeXT

Jobs returns to the Cupertino fold after his firm isbought by Apple.

PIXAR IPO

Following the roaringsuccess of Toy Story,

Pixar raises $140min a stock marketflotation

AMELIO IS OUSTED BY

JOBS

Jobs becomes the bossagain after Gil Amelio pre-sides over a period of bad

results and is pushed aside

Apple stock avoids thefeared lurch downward

APPLE stock resisted the expecteddownward lurch in the wake of Steve Jobs’ death, falling only slightly yes-terday. It closed at $377.37 after ini-tially surging above $380 a share –still below its September high of $423.

Steve Jobs’ long battle with pancre-atic cancer rocked Apple’s share price

on several occasions, with rumours of a deterioration in his health some-

times knocking billions from its mar-ket cap. Yesterday’s share perform-ance has been seen as a vote of confidence in new chief executive Tim Cook, with the market appearingto show faith in the newly formed Apple board.

Apple has now regained almost allof its losses after what was seen as adisappointing launch of its latest

iPhone, the 4S. It was launched just aday before Jobs, aged 56, passed away.

TECHNOLOGY▲

FIRST NeXT

The first computerdesigned by Jobs’ newcompany is launched

JOBS BUYSPIXAR

He snaps up the com-puter animation com-pany from GeorgeLucas for $10m

8/4/2019 Cityam 2011-10-07


Focus on Steve JobsCITYA.M. 7 OCTOBER 2011 25

“You never know if Apple will find

another great innovator like SteveJobs. Who at Apple could fill hisshoes? I think everyone should watchthe share price.”

CLIVE GILBERT | INCEPTA

“Jobs was a part of a team, nothing

lasts forever and you can’t expectApple to not replace his expertise.Apple is such a world-wide successthat it would be near impossible forit not to survive.”

PAUL SMITH | LLOYDS

“The brand is bigger than the individual. The products which Apple hascreated are market leaders. I think Apple will definitely survive.”

DAVID PEARSON | HELIX UK

003 2004 2005 2006 2007 2008 2009 2010 2011

CANCER BATTLEJobs is forced to

take time off to bat-

tle pancreatic can-cer, sparking yearsof speculation over

his health

MADE PERMA-NENT BOSSJobs officiallyback in chargeafter the “inter-im” is finallydropped from histitle. He had

taken to callinghimself iChief

HEALTHSCARE HITS

SHARESCancerrumoursspookinvestors.Bloombergpublish hisobituary bymistake

QUITS TOP JOBHe steps down as chief executive after admit-

ting he could no longer“meet my duties”. He

had taken more time off earlier this year

CITY VIEWS: CAN APPLE EVER REPLACE STEVE JOBS? Interviews by Phoebe Torrance

JOBS DIESTributes flood infrom all over the

world for thetechnology icon

“Steve, thank you for being amentor and a friend. Thanks forshowing that what you buildcan change the world. I willmiss you.” Facebook’s MarkZuckerberg

“The world rarely sees someonewho has had the profoundimpact Steve has had, theeffects of which will be felt formany generations to come.”Microsoft founder Bill Gates

“The world has lost a visionary. There may be no greater tributeto Steve's success than the factthat much of the world learnedof his passing on a device heinvented.” Barack Obama

“He was dubbed a megaloma-niac, but Steve Jobs often gam-bled on young, largely

inexperienced talent to take Apple forward; that such faithwas spot on.” James Dyson

“No words can express our sad-ness at Steve's death or ourgratitude for the opportunity to

work with him. We will honourhis memory by dedicating our-selves to his work.” Tim Cook

“Today, we lost one of the mostinfluential thinkers, creators andentrepreneurs of all time. Steve

Jobs was simply the greatestboss of his generation.” NewsCorp boss Rupert Murdoch

“Tonight our City – which hasalways had such respect forcreative genius – joins with peo-ple around the planet in remem-bering a great man.” New York Mayor Michael Bloomberg

“I am very, very sad to hear thenews about Steve. He was agreat man with incredibleachievements and amazing bril-liance.”Google boss Larry Page

“Steve Jobs changed the world.I knew him a little and admiredhim entirely. Love to Apple andhis family.”Entertainer and presenterStephen Fry

MAKES HIS FORTUNEDisney buys Pixar for $7.4bn, making

Jobs the biggest Disney shareholder andproviding a vast portion of his wealth

LEAVE OFABSENCEJobs takes time

off, later admit-ting to havingundergone a livertransplant

8/4/2019 Cityam 2011-10-07


8/4/2019 Cityam 2011-10-07


28 The ForumCITYA.M. 7 OCTOBER 2011

VINCE Cable is not known for his mili-

tary commentary. So when he recent-ly declared that the economy moreclosely resembled warfare than any

other human condition, he caught the head-lines; I believe he also got it dead right. Why are we surprised by the analogy? Businessand warfare are fundamentally forms of adversarial engagement, where competingparties seek marginal advantage in the mar-

ketplace or on the battlefield. Thankfully, nobody gets killed in

business; a state monopoly on violenceremains the defining characteristic of the military instrument withindemocracies. But when your thirdquarter numbers are soft and thosephone calls from the boss on how canhe help you become more successfulget increasingly insistent, it doesn’talways feel like that. And business isan unremitting 24 x 7 x 365 affair. Nomatter how demanding the contact battle, most soldiers spend more timetraining and preparing for war thanthey do conducting it.

Both disciplines are about the cre-ation of highly defined, high per-forming teams: brand or regiment.

Both face a sentient opponent – thecompetition or the enemy – and any complacent assumption that the oppo-nent is less smart, tough or determined

than the home team is likely to leadto failure. Both business and military life are defined by a patchwork of alliances and adversarial relationships;

the more complex and insidious twen-ty-first century conflict becomes, the clos-

er this resemblance will be.But perhaps there is a single defining con-

cept that draws the two together more thanany other, and it is what I can best describe asthe phenomenon of strategic shock. A strate-gic shock is an event that makes us think dif-ferently about our lives or the way we

conduct business. By definition, it is unfore-

seen and unpredictable; its effects are ubiqui-tous and indiscriminate and have thecapacity to change personal, corporate orinstitutional assumptions; it’s what war feelslike. The first decade of the 21st century con-tained two clear examples: the events of 9/11completely altered the global security land-scape, while the financial crisis changedassumptions around business practice, therole of the state and international economicco-operation.

But the alarming thing about the worldright now is that 2011 has already producedthe Arab Spring and the euro crisis, while anIranian bomb, Chinese mercantilism and theUS deficit are waiting in the wings. So, as theincidence of strategic shock increases, maybeCable’s easy headline was even moreprophetic than it first appeared or he everintended.

In its pure form, war implies the implaca- ble clash of competing wills in an environ-ment where the conventions, structures andestablished routines of peacetime are lostand replaced by chaotic violence. Is that where we are now? No, it’s worse than that.Competing wills are always biddable at somestage, but what we seem to face now is not anenemy looking, at some point, to negotiate but an arbitrary destiny which has none of the calculus of strategic advantage.

The world we face now has all the confu-sion of warfare, but, for now, none of the bloodshed (literal at least, metaphorical bloodshed stains most boardrooms andchanceries). The trick will be to keep it that way as Greek mobs howl for justice, theBritish dispossessed contemplate the nextround of recreational larceny and Chinalooks to contest US naval hegemony in the western Pacific.

So, a parlous situation, and, if we pursuethe warfare theme, what do the generalsintend and what strategies will they employ? This is the point at which a military frame of

reference begins to become unstuck. Most

militaries maintain encyclopaedic contin-gency plans and constantly rehearse respons-es to unpredictable events, but thepoliticians holding the fate of the euro or theUS federal deficit in their hands conspicu-ously lack coherent plans or even the intel-lectual techniques to address the problemsthey face.

All this begins to look like the worst of allpossible worlds: a state of war but with nocompetent generals to take charge. But t hatmay change soon. Afghanistan is now theUSA’s longest-ever campaign, and hundredsof thousands of young Americans have beenengaged in the wars of the twenty-first centu-ry. The numbers from the roll call of European nations is smaller, but still repre-sents a phenomenon that has not existed onthis continent for 60 years – a generation of future leaders in public and business life who have experienced “the disciplines of the wars”. For men and women whose formativeexperiences have been forged in the crucibleof combat, this will carry an indelible mark into their future careers, and the sooner the better.

It was a good line, minister, but truer than you thought.

A former general, Sir Robert Fry KCB, CBE is anexperienced leader, soldier and businessman. Withover 30 years spent on military operations fromUlster to Kosovo, the Gulf, Iraq and Afghanistan, heis now executive chairman of global business consul- tancy McKinney Rogers where he advises the chief executives of Fortune 500 companies.

Strategic shock is what warfeels like. Two examples are9/11 and the financial crisis.

In a chaotic world, businessneeds competent generals.A military expert weighs in

cityam.com/forum

SIR ROB FRY

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8/4/2019 Cityam 2011-10-07


Investments that

are as safe as housesProperty is still attracting attention in thesetough economic times, writes Stephanie Broll

TUMULTUOUS financial markets have notturned off the property investor. Indeed,the luxury London and world cities mar-kets are booming.

Catherine Cockcroft of estate agent Aylesfordsays: “Investing in bricks and mortar has provedto be a reliable asset because stocks and sharesare extremely unsteady, interest on savings isnominal and a reasonable pension is lookingunlikely in years to come.”

No wonder then that the Property Investor

Show – the annual gathering for property investors and landlords – is back in town next week. And we are promised that this year it’sgoing to be bigger than ever. It will even be sport-ing an Indian pavilion, where developers andagents from mainstream Goa to niche marketssuch as Gurgoan will be out in force, ready and willing to give comment and advice on the mar-ket.

There will also be Sipp Zone, dealing withproperty for self-invested personal pensions,

catering to investors after strong but reliablereturns. Cockcroft says that renting can deliver agross yield of around 3.5 per cent: “Much health-ier than the typical interest rates offered by banks.”

STUDENT ACCOMMODATION There will be a focus on student accommodationtoo. Dave Burgess, who is marketing his firm theHotel Investment Company at the show, says he’sgoing to be there because the student accommo-

dation market shows no sign of declining andmany investors haven’t realised this yet. “In fact,the provision of accommodation is likely toincreasingly be the preserve of the private sectorsince universities will be concentrating theirresources on their core business – the provisionof good quality teaching and research.”

The Property Investor Show & OPP Live 2011 show will take place in the ExCel centre, London on 13-15October 2011. To find out more visit: www.propertyin- vestor.co.uk/london.

Call: 0800 883 8321

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Living | Property Investor Show

30 CITYA.M. 7 OCTOBER 2011

8/4/2019 Cityam 2011-10-07


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CASTLE KEEP PENTHOUSEPrice: £999,995Castle Keep Penthouse is a duplex apartment over two floors and a roof terrace. It hashigh ceilings, an elegant dining room with a marble fireplace, three double bedrooms allen suite, a luxury bespoke oak-finished kitchen, guest cloakroom and laundry room.Contact: Savills on 01923 824 225 or go to www.savills.co.uk

STANMOREPLACEPrice: £365,000A first-floor, two-bed-room apartment isavailable in AlbertCourt, Stanmore Place.It has two bathroomsand is 63.6 squaremetres in total. Thedevelopment has alarge lake and land-scaped gardens.Contact: Knight Frank on 020 7681 5499 or go to www.knight- frank.co.uk

BENTLEY PRIORYPrice: £2mThis striking duplex apartment enjoys views over the grade II-listed Italian gardenterrace at the former RAF Bentley Priory. The property has a large period balcony andtwo contemporary roof terraces. It has three bedrooms across three floors. Contact: City & Country Group on 01279 817882 or go to www.cityandcountry.co.uk

Q.I’m struggling to sell my flatand was wondering whetheryou would recommend letting

it out and using the income to rentor buy something else?

A.Given the difficulty everyone ishaving getting a mortgage at themoment, the rental market is

increasingly busy. Indeed, I’m amazedthat several commentators have nowstopped giving average sales values andhave started giving rental figures instead.The average is around £710 per calendarmonth at the moment. So renting yourproperty out may be an attractive option.But being a landlord is not necessarily allit’s cracked up to be. Some parts of thecountry can command returns on capitalof 10 per cent, but in London it can be

less than half that.Remember you will end up paying

income tax on the rent and up to 15 percent on management fees. This is clearlynot an investment strategy that adds upunless you intend to downsize. In fact, it’sa mistake many potential buy-to-letinvestors make.

Most professional investors look forlong-term capital growth using theirrental income to keep the property ingood condition.

GET ADVICEGet some advice on what your propertywould let for. Talk to three agents andget a good spread of values. Also, checkwhat they think the occupancy will be inorder to minimise void periods. If theysay there is demand in the area, ask tosee proof. Also, ask to see details of simi-larly let properties – don’t take any fluff answers.

Do your research in the area beforeyou try to find a tenant. The rental busi-ness tends move quickly. It should bepossible to find someone who will behappy to rent your property over the longterm, often for years, meaning that hope-fully you might then be able to sell yourproperty at a better time, and possiblyfor more money.

But I would be wary of clocking upmore debt on a second mortgage. That is,of course, if you can get one at themoment.

Ed MeadDIRECTOR OFESTATE AGE NTDOUGLAS & GORDON

Q A&

CURRENT MORTGAGE DEALS BY DONATA HUGGINS Source: MoneySupermarket.com

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

Santander Flexible 1.95 2 years 4 60

Skipton BS Flexible 1.98 2 years 4.8 60Chelsea BS Flexible 1.99 December 2013 5.3 70

First Direct Flexible 1.99 2 years 3.6 65

Yorkshire BS Flexible 2.29 November 2014 4.4 75

Leeds BS Fixed 1.99 December 2013 5.5 75

Santander Fixed 2.35 December 2013 4.1 60

Chelsea BS Fixed 2.39 December 2013 5.4 70

ING Direct Fixed 2.69 November 2014 3.5 60

BUYSTANMORE, HA7 BY DONATA HUGGINS

/cqlondon

COMMUTING: Stanmore sits at thenorthern terminus point of the Jublieeline. It takes 50mins to reach bothCanary Wharf and the City from

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EDUCATION: North London CollegiateSchool for girls is very close toStanmore. It scores highly every yearand has been named Independent

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Source: Savills

Living | Focus On32 CITYA.M. 7 OCTOBER 2011

8/4/2019 Cityam 2011-10-07


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TEN S ALES IN THE

L AS T SI X WEEKS

8/4/2019 Cityam 2011-10-07


The Fear Index: The day hascome to make a real killing...

THE avarice and greed of tradersleading themselves and others toruin. The creation of powerful com-puter-driven algo systems that

nobody understands. Another creation by grasping bankers trying to churn and burn viable publicly listed businesses asfast as they can. Whipping up uncontrol-lable market volatility. Exacerbating terri-fying sounding “flash crashes.” Allhappening in the blink of an eye.

So far, all very H.G. Wells. And all greatfodder for a blockbusting sci-fi novel by Robert Harris.

The only problem is that it’s pretty wideof the mark.

As horses speeding from the port to themarket with news of a trading ship’s for-tunes gave way to signal lanterns, whichgave way to telegrams and telephones,

which in turn gave way to fibre opticcables able to carry information aroundthe globe in milliseconds, technology hascome in for criticism.

When a system of lanterns was set up inthe 1840s, allowing a message to be trans-mitted from New York to the Philadelphia

stock exchange in less than 30 minutes, Abraham Lincoln warned that these dan-

gerous advances would lead to increasedmarket volatility.

And now that trades are measured inmicroseconds, rather than in minutes, it

is high-frequency trading (HFT) that hasdrawn the ire of many.

FACT CHECKINGBut does any of this criticism hold water?

We decided to ask Fred Ponzo, managingpartner of GreySpark Partners. Fred (right)

works closely with banks, exchanges,clearing members and hedge funds toresolve issues they may have with theirexecution, risk management or tradingfunctions. He therefore keeps close to allmajor regulatory and industry changesand developments, and an ear to theground on what’s going on in the domes-tic and international financial markets.

“It is impossible to sustain a marketmaking activity on a larger number of products and with tight spreads withoutHFT,” says Ponzo. “The simple fact is thatif HFT wasn’t useful, then it would havedisappeared years ago.”

The technological advances that we

have seen in the trading sphere haveof course been driven by the profit

motive, but if it wasn’t for this one-upmanship, we’d still be living in caves,trying to kill each other with pointy sticks. Algorithmic trading – trying to

make profits from discrepancies betweentwo prices, or between a derivative andunderlying asset, actually aids markets.

And this effect is multiplied by electronictrading: “The key part of HFT is arbitrage,”says Ponzo. “Arbitrage removes discrepan-cy across asset prices and acts as a regula-tor.”

FLASH CRASH FEARBut what about the issue of flashcrashes? Huge amounts wiped off ashare’s value, only to bounce back in the space of seconds. “We actu-ally see fewer flash crashes than we did 10 years ago. In the pastthey were caused by human

beings panicking – crashes weremuch bigger and took longer torecover.”

According to Ponzo, electronictrading, rather than acting as adetriment to market behaviour

actually improves market condi-tions: “Because computers are

making the decisions, it erodes a lot of themania.”

Part of the reason why the new advances in technology provide such fuel

for scare-mongering and for sci-fi novels isthat they are such an unknown to theman in the street. Most people can under-stand that there are people who make aliving because they can buy and sellshares more successfully than they can.

They may not be completely enamoured with this, but as anybody can buy and sellshares through their friendly local stock-

broker, it is something they can relate to.Ultra low-latency high frequency trad-

ing of the same instruments is somethingdifferent altogether.

But as Ponzo puts it: “People have a fearof high speed trading because it’s a bit likethe leap from horse carriages to trains.Going from horses to trains was a leap intechnology – but though people fell off horses all the time, when you have a traincrash, though it happens less frequently itis more spectacular because of the speed.”

But that is no reason to ban trains – orHFT.

Craig [email protected]

Business Features | Insight

34 CITYA.M. 7 OCTOBER 2011

Now available in allgood book shops

THEY gathered around the tradingscreen in Execution. One of thequants vacated his desk to givethem a better view.

“So, this is VIXAL-4 in operation,” said

Hoffman. He stood back to let theinvestors get closer to the terminal. Hedecided not to sit: that would have letthem see the wound on his scalp. “Thealgorithm selects the trades. They’re onthe left of the screen in the pendingorders file. On the right are the executedorders.” He moved a little nearer so thathe could read the figures. “Here, forinstance,” he began, “we have…” Hepaused, surprised by the size of thetrade; for a moment he thought the dec-imal point was in the wrong place. “Here

you see we have one and a half millionoptions to sell Accenture at fifty-two dol-lars a share.”

“Whoa,” said Easterbrook. “That’s aheck of a bet on the short side. Do youguys know something about Accenture

we don’t?”“Fiscal Q2 profits down three per

cent,” rattled off Klein from memory,“earnings sixty cents a share: not great

but I don’t get the logic of that position.”Quarry said, “well, there must be

some logic to it, otherwise VIXAL would-n’t have taken the options. Why don’t

you show them another trade, Alex?”Hoffman changed the screen. “Okay.

Here – you see? – here’s another short we’ve just put on this morning: twelveand a half million options to sell Vista

Airways at seven euros twenty-eight ashare.”

Vista Airways was a low-cost, high-vol-ume European airline, which none of those present would have dreamed of

being seen dead on.“Twelve and a half million?” repeated

Easterbrook. “That must be a heck of achunk of the market. Your machine hasgot some balls, I’ll give it that.”

“Really, Bill,” said Quarry, “is it thatrisky? All airline stocks are fragile thesedays. I’m perfectly easy with that posi-tion.” But he sounded defensive, andHoffman guessed that he must havenoticed that the European markets wereup; if a technical recovery spread acrossthe Atlantic, they might be caught up by a rising tide and end up having to sellthe options at a loss.

Klein said, “Vista Airways had twelveper cent passenger growth in the finalquarter and a revised profits forecast up

nine per cent. They’ve just taken delivery of a new fleet of aircraft. I don’t get thesense of that position, either.”

“Wynn Resorts,” said Hoffmann, read-ing off the next screen. “A million-twoshort at one hundred and twenty-four.”He frowned, puzzled. These enormous

bets on the down side were unlike VIXAL’s normal complex pattern of hedged trades.

“Well that one truly is amazing to me,”

... but our writer disagrees. Algos mean no harm

said Klein, “because they had Q1 growthup from seven-forty million to nine-oh-nine, with a cash dividend of twenty-fivecents a share, and they’ve got this greatnew resort in Macau that’s literally alicence to print money – it turned overtwenty billion in table games in Q1alone. May I?” Without waiting for per-mission, he leaned past Hoffmann,seized the mouse and started clickingthrough the recent trades. His suit

smelled like a dry-cleaning store;Hoffman had to turn away. “Procter andGamble, six million short at sixty-two…Exelon, three million short at forty-one-fifty... plus all the options… Jesus,Hoffmann – is an asteroid about to hitthe earth, or what?”

Reprinted with permission. The Fear Indexby Robert Harris is published by Hutchinson, £18.99.

An extract from the new Robert Harris book sees technology turn on its creator

Robert Harris presentsa terrifying view of

technological advancesPicture: GETTY

8/4/2019 Cityam 2011-10-07


GENTLEMAN, take note. You mightnot know of Michael Fassbender, but

you will: the Fass-fest will start soon. The chiselled Brit has crept onto the

big screen as Magneto in X-Men First Class,the cravatted Mr Rochester in Jane Eyre,and a sex addict in Shame opposite Carey

Mulligan, a performance which earnedhim the best actor prize at Venice film festi-

val. Oh, and he’s analysing dreams as Carl Jung in a Dangerous Method and will beRidley Scott’s robot in the upcoming alien-esque Prometheus. He’s certainly been pro-ductive.

Ladies love him, and men want to behim. Why? “Fassbender is like Al Pacino,”says Robert Johnston, associate editor atGQ. “He has that old school movie startouch. He doesn’t take any risks with hisstyle and he’s right not to.”

E. Tautz designer Patrick Grant agrees:“Fassbender wears a suit with a certainnonchalance. He’s a great advert for dress-

ing well in a modern way.”Heralding the return of the gentleman

with a three-piece suit, Fassbender bringsan edge to the classic glamour of a suit. “Hehits the look absolutely on the button,” says

Johnston. “And three-piece suits have really come back; they’re very practical as we

come into winter.” Take his appearance at the X-Men pre-

miere in May. He wore an unusual lightgrey double-breasted three-piece suit (pic-tured right) with a two-button cuff andcasually left the button of his waistcoatundone.

“He’s simply taken an English tailoringstaple, and translated it into a fashionpiece,” says Johnston.

And who knows, follow the Fass, and youmay end up with more than you thought.

“He looks perfect boyfriend material,”says Johnston, “because there’s a certain

vanity in the way he dresses. He knows helooks good.”

Michael Fassbender is bringing old-schoolglamour to our screens. Helena Lee finds outhow to get the British look of this rising star

“Fassbender is like Al Pacino. He has that oldschool movie star touch. He doesn’t take anyrisks with his style, and he’s right not to.”

A light grey suit as above would be great at a wedding, but for the daylook, invest in a heavier fabric in a charcoal grey. GQ’s Robert Johnstonsuggests pairing the suit with a crisp white shirt and if wearing one, ablock-coloured tie. Of course you can get your suit tailored on Savile Row –somewhere such as Patrick Grant’s Norton & Sons (pictured left) would be just-so for that bespoke suit, but think Armani and Reiss as well. Pair withclassic aviators like Ray Ban to complete the moviestar look.

GET THE LOOK | FASSBENDER STYLE

Lifestyle OUR GUIDE TO LONDONCOCKTAIL WEEKIN MONDAY’S LIFESTYLE

35

The brand new

Fass of fashion

HOW TO GET

DRESSED

Q.Fashion pages are full of jump-suits, I'd really love to wear onebut I don't think I can pull it off

especially as I’m 5”3 and size 12.

A.Just like dresses, there is a jump-suit for every shape and person-ality. They've been around long

enough to have proven they are morethan a flash in fashion history. So now isthe time to invest in yours.

The classic full length jumpsuit doesrequire a bit of height so if you're shortin stature you will need a big pair of heels. Work it that way for a cocktailparty.

For the more curvaceous avoid therelaxed jersey styles and go for a tai-lored, structured piece. It will not onlyflatter but look much smarter.

If you are tall but still worry that theall in one is too strong astatement, try a two tone

jumpsuit. Like a two tonedress the jumpsuit willseem like separates atfirst glance and break upthe look for a moresubtle silhouette.Go for a linentrouser with silktop for pureelegance.

For thepetite, try aculotte shortshape jumpsuit.This will serve as adress alternative andcan be worn withtights in the winterand remain a playfuloption for summerwith sandals. A Frenchnavy number is the per-fect trans-seasonalchoice.

Choose the top shapethat works best for yourbody type – spaghettistraps to break up broadshoulders, asymmetricone-shouldered can con-ceal a large bust and hal-ter-neck shows off a goodback. For the corporate, acollared neckline is a moreempowering alternative.

www.rousiland.com

Q A&Clare Rous &Kara IlandFOUNDERS OF ROUS

ILAND MEMBERS’

BOUTIQUE

OTHER FASHION NEWSBY HELENA LEE

MILAN FASHION WEEKCLASH WITH LONDON

Tensions rise as Milan hasannounced that its fashion

week next September willoverlap with London andNew York’s. In spite of anagreement made in 2008that events at New York,London, Milan and Parisshould be scheduledsequentially, editors and

buyers may be forced tochoose one city over anoth-er. The question is, whichfront rows will La Wintour,the grande dame of fash-

ion, choose if the dispute isnot resolved?

KATE MOSS LAUNCHESJEWELLERY LINE AT PARISFASHION WEEKKate Moss dazzled the fash-ion pack with her new jew-ellery designs forLMVH-owed Fred. She dis-played her multitaskingabilities in not only launch-ing the jewellery line atthe Ritz, but also by mak-ing a rare appearance onthe catwalk for her friendMarc Jacobs at Louis

Vuitton. The 22 styles will be available fromKnightsbridge’s Harrods,

and prices range from €350to €35,000.

SHE’S GOT IT: FLORENCEOPENS CHANEL SHOWFlame-haired Venus,Florence Welch fromEnglish band Florence andthe Machine, emerged froma shell to perform at theChanel show on Tuesday.Karl Lagerfeld went on tounveil his ocean-themedcollection at the Ready to

Wear Spring/Summer 2012show at the Grand Palais.

Also in attendance on thefront row was a glitzy mixof Uma Thurman, photog-rapher Mario Testino and

die-hard Chanel fan AlexaChung.

8/4/2019 Cityam 2011-10-07


Film

MIDNIGHT IN PARISCert: 12A

hhhhh

WOODY ALLENhas been famously up anddown in his noughties film-makingcareer. Everyone loved to hate Match Point

and Scoop (I rather liked them – ok,maybe not Scoop); but then, Vicky Cristina Barcelona was a triumph. I alsoliked Belinda and Belinda, but othersloathed it.

Midnight in Paris is a joy – whether you’re a fan of the old, old Allen or justsomeone who likes a good rom-com. Well,this is better than a good rom-com; it’sinteresting and textured and odd, as youmight expect.

Owen Wilson charms as the slightly dreamy Gil, visiting Paris with hisstraightforwardly commercial, money-loving fiancée Inez, played with perfectshiny awfulness by Rachel McAdams. Gil

writes shallow Hollywood scripts by day, but dreams of writing novels in a garret(in Paris), whose Jazz Age literary tradi-tion he particularly loves. His fiancée doesnot share the latter part of his dream.

There’s a scene near the beginning – withthat wonderful Allen mixture of cheese,kitsch and irony – where the couple standon a bridge in the Tuileries together (pic-tured) and Wilson asks if Inez could everimagine living in Paris. She says, withouta hint of softness, no.

One night, after dinner with her equal-ly shiny, stiff parents, Wilson is invited tostep into a black car. Beckoned by its bon

vivant occupants who are smoking anddrinking champagne, he can’t resist. But

what’s this? Suddenly he’s drinking withHemingway, Fitzgerald, and Gertrude

Allen is better than everwith this nostalgic rompOwen Wilson glowsas a Jazz Agedreamer in Paris,says Zoe Strimpel

Stein. As well as falling in love with the1920s, he falls in love with a beautiful

woman, an ex-lover of Picasso’s, played by Marillon Cotillard.

Night after night he gets back in thecar, the gap in heart and mind wideningdaily between his formal reality (fiancée,Louis Vuitton, dinners, being snapped at),and this dreamy paradise of Paris past.

This is one of the most interesting andpleasant romantic comedies in recent

years and shows that Allen has suddenly sweetened with age.

JOHNNY ENGLISH REBORNCert: PG

hhhii

ROWAN ATKSINSON led the first Johnny English, made in 2003, into juicy boxoffice territory with his Mr Bean-styleparody of James Bond (the film was actu-ally scripted by Bond film writers NealPurvis and Robert Wade).

Now back in all his ill-fated, inelegantsub-glory, Johnny English is recalledfrom hiding in disgrace after a missionin Mozambique five years ago. Leavingthe Tibetan monastery where he is inmartial arts training (great for danger-ous ops), he is brought back to MI7’s(yes, 7) HQ in London. English finds him-self embarking on another mission, this

time in Hong Kong, where he must stopa group of international assassins beforethey kill a world leader and – naturally –cause global meltdown. His new boss atMI7 is played by Gillian Anderson;Rosamund Pike, a former Bond Girl,stars too.

Chaos arises after a meeting in aKowloon tenement, when English and acronie rendez-vous with a rogue CIA agent, who reveals he’s part of analliance called Vortex, which possesses achemical weapon, control over which issought by an MI7 mole. Needless to say,English doesn’t handle the case smooth-ly. Taking more from recent Bond films(of the Pierce Brosnan era particularly)than the first one did, this should have

you smiling sporadically (or guffawing,depending on your sensibilities). Of course, the sheer stupidity of the wholething will be more of an irritation thana virtue to some.

Top: Owen Wilson andRachel McAdams inMdnight in Paris.Above: RowanAtkinson in JohnnyEnglish Reborn.

DRIVING MISS DAISYWyndham’s TheatrePlay of the oscar-winning film with VanessaRedgrave and American actor James EarlJones as her chauffeur.

FAUSTRoyal Opera HouseLast chance to see Gounod’s version of theclassic tale of hubris and overreaching. Ends10 October.

WAR HORSENew London TheatreThe epic play charting the relationshipbetween a young man and his horse inWorld War I has moved to the West End.

DEATH AND THE MAIDENHarold Pinter TheatreBAFTA award-winning Thandie Newtonmakes her stage debut as a former politicalprisoner in Ariel Dorfman’s play.

BACKBEATDuke of York TheatreStage adaptation of the 1994 film of thestory behind the formation of the Beatles,and their journey from Liverpool toHamburg.

THE VEILLyttelton TheatreTony award-winning Conor McPherson’s

new play set in 19th century Ireland.

ARTS ROUNDUP

Lifestyle | Reviews CITYA.M. 7 OCTOBER 201136

Michelinverdict inbut lacks

sparkle

ON Twitter, food-lovers were countingdown the minutes to the GreatBritain & Ireland Guide, and thoughthere were grumbles that there was

very little change in the restaurants award-ed two and three stars, the Bib Gourmandcategory, which indicates “good food atmoderate prices” most reflected the changein London restaurants over the last two

years.Recognition of London’s increasing fond-

ness for casual restaurants is evidenced by the awarding of the Bib Gourmand to thedarlings of the food scene: Russell Norman’sPolpo and da Polpo, Koya, the Opera Tavern(part of the Salt Yard group), cult favouriteSushi Say, Bermondsey Street’s José, andBrawn, which joins its sister Terroirs.

Heston Blumenthal’s Dinner and theScandinavian North Road inFarringdon have gainedone star as has Jason

Atherton’s critically acclaimed PollenStreet Social. Bray’s FatDuck and WatersideInn retain their threestar status as doesLondon’s GordonRamsay and AlainDucasse at TheDorchester.Helena Lee

ANYTHING NEW?Highly anticipated is the Frieze project

with Anahita Razmi, the recipient of this year’s Emdash Award, which aims to sup-port emerging talent. The work that will

be unveiled draws attention to Tehran’sskyline, and how it was recently used by protestors after the Iranian presidentialelection.

ALTERNATIVE ART FAIR?Prop the Ruinart bar with a glass of Champagne at the Pavilion of Art andDesign London in Berkeley Square, whichshowcases everything from modern art,design to jewellery from 1860 onwards.

AND?If you’re peckish, head down to the Cox,

Cookies and Cake shop in Soho. DesignerPatrick Cox has teamed up with contem-

FRIEZE ART FAIR | HELENA LEE 13-16 OCTOBER

WHAT?Frieze Art Fair is an annual London eventin Regent’s Park that features acclaimedinternational art from over 170 contempo-rary galleries. Talks, tours and films will

be given in addition to the 1,000 workspresented, so there should be somethingfor everyone. Expect dynamic work fromemerging creative hotspots South

America and Asia.

WHO? Anyone can go, although it’s best to buy advance tickets, which are cheaper.

THE SCULPTURE PARK The English Gardens of Regent’s Park willhost international sculptures fromacclaimed artists such as Tom Friedman

and Kiki Smith. The park is a short walk from the fair and is free to the public.

The art bonanza of the

year to roll into town

porary art luminaries to create limitededition art cakes to raise money for

Amnesty International during the FriezeFair. Go for Gary Hume’s “Begging for it”cupcake.

THE FUTURE?Next year will see a collaboration of theFrieze art fair with new fair FriezeMasters, which aims to celebrate art rightup until the turn of the millennium.

Advance tickets: £20, £15 concessions, or £40 for

the whole weekend. For full ticket information,visit www.friezeartfair.com.

Frieze has become aniconic part of theLondon social and artscene.

8/4/2019 Cityam 2011-10-07


T E R

R E S T R I A L

AUTUMNWATCH LIVE

BBC2,8.30PMChris Packham, Michaela Strachanand Martin Hughes-Games present thenature programme that studieswildlife through the season.

CORONATION STREET

ITV1,8.30PMSteve reassures Tracy they can makethings work, while a devastated Becky

hides her feelings from him, andFirefighter Paul impresses Eileen.

UNREPORTED WORLD

CHANNEL4,7.30PMThe foreign affairs programme returnswith presenter Krishnan Guru-Murthy,who introduces each edition and alsotakes the helm in the first film.

BBC1

SKY SPORTS 17pmSky Sports News at Seven

7.30pm Live International Football

10.30pm International Football

12am Take It Like a Fan 12.30am

Football League 1.30am Take It

Like a Fan 2am International

Football 3.30am Take It Like a Fan

4amFootball League 5amRoad to

London 5.30am-6am Take It Like

a Fan

SKY SPORTS 27pmLive Darts 8.30pm LiveInternational Football 10.30pm

Live PGA Tour Golf 1am European

Tour Golf 3amPGA Tour Golf

5.30am-6am IAAF Athletix

SKY SPORTS 37pmRoad to London 7.30pm Live

International Football 9.45pm Live

Darts 11pm Boots ‘n’ All 11.30pm

Road to London 12am Elite League

Ice Hockey 1am Tight Lines 2am

Road to London 2.30am Boots

’n’ All 3amRoad to London

3.30am NFL: Total Access 4.30am

Tight Lines 5.30am-6am Kings Of

The Extreme

BRITISH EUROSPORT7pmBritish Superbikes 8pm

Cycling 9pmTwenty20 Champions

League Cricket 10.30pm Triathlon

11.30pm Euro 2012: All Access

12.25am-12.40am GT Academy:

Road to Dubai

ESPN

7pmWRC: Access All Areas 8pmLive International Football 10pm

International Football 11.45pm

ESPN Press Pass 12.15am World

Series of Poker 1.15am Goal!

Special 1.45am ESPN Kicks: Extra

2amLive College Football

5am-6am American Le Mans

Series

SKY LIVING7pmCriminal Minds 8pmDrop

Dead Diva 9pmCriminal Minds

10pm Jerry Bruckheimer’s Chase

11pm Bones 12am Criminal Minds1amCSI: Crime SceneInvestigation 2.40amMaury3.30am Bones 4.20am Nothing toDeclare 5.10am-6am JerrySpringer

BBC THREE7pmMerlin 7.45pmGreat MovieMistakes 2: The Sequel 8pm TheReal Hustle: New Recruits 8.30pmE209pmLittle Britain9.30pmLee Nelson’s Well Good Show

10pm EastEnders 10.30pmEastEnders: The New Moons11.30pm Him & Her 12am FamilyGuy 12.45am American Dad!1.30am Lee Nelson’s Well GoodShow 2amLittle Britain 2.30amEastEnders: The New Moons3.30am Him & Her 4amThe RealHustle: New Recruits4.30am-5.30am Young Soldiers

E47pmHollyoaks 7.30pm How I MetYour Mother 8pm Jo Frost:Extreme Parental Guidance

9pmSupersize vs Superskinny10pm Embarrassing Fat Bodies11.05pm Wife Swap USA12.10am The Big Bang Theory1amScrubs 1.50am How I MetYour Mother 2.10amEmbarrassing Fat Bodies 3.05amRules of Engagement 3.30amReaper4.15am Glee 4.55am-6amSwitched

HISTORY7pmDeep Wreck Mysteries 8pm

Storage Wars 9pmAmericanPickers 10pm Swamp People12am The Nostradamus Effect1amThe True Story 2amSwampPeople 3amDeep Wreck Mysteries4amPawn Stars 4.30am StorageWars 5am-6am AncientDiscoveries

DISCOVERY7pmMythbusters 9pmWeird orWhat? 10pm Alone in the Wild11pm Gold Rush 12am Bear Grylls:Born Survivor 1am Ice Pilots 2am

Truth Behind the Moon Landings

3amDeadliest Catch 3.50amRiver Monsters4.40am Treasure

Quest 5.30am-6am Destroyed in

Seconds

DISCOVERY HOME &

HEALTH7pmBirth Days 8pm I Didn’tKnow I Was Pregnant 9pm

Supernanny 10pm Sextuplets and

Twins 11pm Trauma Unit 12am

Supernanny 1amSextuplets and

Twins 2amTrauma Unit 3am IDidn’t Know I Was Pregnant 4am

A Baby Story 5am-6am Deliver

Me

SKY17.30pm The Middle 8pmModern

Family8.30pm The Simpsons9pmAn Idiot Abroad 2 10pm ALeague of Their Own 11pm Mount

Pleasant 12am Brit Cops: Frontline

Crime UK 1amRoad Wars 1.50am

Night Cops 2.40am The Dresden

Files4.20am It’s Me or the Dog5.10am-6am Top Design

BBC2 ITV1 CHANNEL4 CHANNEL5

S A T E L L I T E &

C A B L E

TVPICK6pm BBC News 6.30pmBBCLondon News 7pm The One Show

7.30pmNigel Slater’s SimpleCooking: BBC News

8pm EastEnders

8.30pm Celebrity MasterChef

9pm Outnumbered

9.30pmWould I Lie to You?10pmBBC News 10.25pm

Regional News 10.35pmCome Flywith Me 11.05pm Mrs Brown’sBoys 11.35pmThe National LotteryFriday Night Draws 11.45pm

MOBOs Highlights 2011: 1.15amFILMStark Raving Mad: 2002.2.50amWeatherview 2.55amSign

Zone: Question Time 3.55am BBCNews 5am-7.30am Formula 1: TheJapanese Grand Prix – Qualifying

6pm Eggheads

6.30pm Strictly Come Dancing

– It Takes Two

7pm The Culture Show

8pm Gardeners’ World

8.30pmCHOICE

Autumnwatch Live

9.30pm Autumnwatch

Unsprung10pm QI

10.30pmNewsnight

11pm The Review Show

11.45pmWeather11.50pmLater with Jools Holland

12.50amFILM Tadpole: 2003.

2.05am The Culture Show 3.05am

BBC News 4am-6amClose

6pm London Tonight

6.30pm ITV News

7pm Emmerdale

7.30pm Coronation Street

8pm Love Your Garden

8.30pmCHOICE Coronation

Street

9pm DCI Banks

10pm ITV News at Ten10.30pm London News

10.35pmFILMAlexander:

Historical epic, starring Colin

Farrell. 2004.

1.35am The Zone; ITV News

Headlines3.40am-5.30amFILM

House of Wax: Horror, starring

Elisha Cuthbert. 2005.

6pm The Simpsons 6.30pm

Hollyoaks 7pm Channel 4 News

7.30pmCHOICE Unreported

World

7.55pm 4thought.tv

8pm Come Dine with Me

9pm The Million Pound Drop

Live

10.30pm8 Out of 10 Cats 11.05pmRandom Acts 11.10pm Chris

Addison: My Funniest Year 1.10am

Music on 4: Wretch 32’s Arthur’s

Day Diary 1.25am On Track 1.50am

Super Saturday 3.20am The Real

Housewives of New Jersey 4.05am

Accidentally on Purpose4.30am

Countdown 5.15am-6.10am

Cookery School

6pm Home and Away

6.25pm OK! TV

7pm 5 News at 7

7.30pm Pawn Stars:

5 News Update

8pm Ultimate Police

Interceptors: 5 News at 9

9pm Big Brother: Live Eviction

10pm The Bachelor11pm Big Brother: The Eviction

Interview 11.30pmBig Brother’s

Bit on the Side 12.15am

SuperCasino 4.05am Motorsport

Mundial 4.30amNick’s Quest

4.55amRough Guide to Islands

5am County Secrets 5.10am

HouseBusters 5.25am County

Secrets 5.35am-6amHouse Doctor

18 7

11 30

45

23 3 12

14 37

9 7

38 16

11 5 9

45

29 10

6 24

27

30

35

15

12

6

19

19

42

10

10

41

18

16

4

13

16

34

28

14

Fill the grid so that each block

adds up to the total in the box

above or to the left of it.

You can only use the digits 1-9

and you must not use the

same digit twice in a block.

The same digit may occur

more than once in a row or

column, but it must be in a

separate block.

COFFEE BREAKCopyright Puzzle Press Ltd, www.puzzlepress.co.uk

KAKURO

QUICK CROSSWORD

LAST ISSUE’SSOLUTIONS

KAKURO

WORDWHEELUsing only the letters in the Wordwheel, you have

ten minutes to find as many words as possible,

none of which may be plurals, foreign words or

proper nouns. Each word must be of three letters

or more, all must contain the central letter and

letters can only be used once in every word. There

is at least one nine-letter word in the wheel.

SUDOKU

Place the numbers from 1 to 9 in each empty cell so that each

row, each column and each 3x3 block c ontains all the numbers

from 1 to 9 to solve this tricky Sudoku puzzle.

SUDOKU

QUICK CROSSWORD

ACROSS

1 Missives used as birthday

or Christmas greetings (5)4 Chair used as a carriage (5)7 Yellow-coloured explosive

compound (inits) (3)8 Primitive plant forms (5) 10 Add together (3)11 Agitate (4) 12 Mr Richardson, knighted

actor (1902-1983) (5) 14 ___ faithfully, letter

ending (5) 15 Available (3) 16 Boasts (5)17 Follow as a result (5) 20 US lyricist, ___ Porter (4) 21 Pistol, for example (3) 22 Depart (5) 24 Edgar Allan ___, US

writer and poet (3) 25 Heave (5) 26 Hazardous (5)

DOWN

1 Position of

professor (5)2 Harass with

persistentridicule (3)

3 Medical instrumentfor listening tosounds (11)

4 Narrator (11)5 Talk about in

detail (7)6 Makes impervious

to feeling (5)9 Snake (3) 13 Apprentice (7) 16 Fake (5) 18 So-named before

marriage (3)19 Lament for

the dead (5) 23 Beast of burden (3)

A

R

U

T

IL

P

N

A

B E A M U N L I K E

R O A F E

U N D O O U T C R Y

N D E A

E A S Y S T R E E T

I R K O A I R

M I S F O R T U N E

H O E N

P O I N T S M I N E

L P E P G

B E A U T Y T Y P E

6 8 8 9 7 2 1

2 9 8 6 7 1 4 5 3

1 2 5 4 2 1 3

9 6 8 2 6 8

6 9 2 6 1 3 4 5

3 2 5 1 7 6 8 9

1 6 8 4 9 2 1 7

2 5 6 8 4 9

8 9 4 7 6 7 1

3 4 7 1 6 9 8 5 2

9 7 2 3 1 9 8

WORDWHEELThe nine-letter word was

POSTULATE

Lifestyle | TV& Games 37CITYA.M. 7 OCTOBER 2011

8/4/2019 Cityam 2011-10-07


DON’T MISSTHE BESTHORSES. JOCKEYS. RACING ASCOT RACECOURSE

SATURDAY 15TH OCTOBER 2011

QIPCO BRITISH CHAMPIONS DAY

TICKETS FROM £26

FINE DINING PACKAGES FROM £265PP

GROUP AND ADVANCE BOOKING

DISCOUNTS AVAILABLE. BOOK NOW AT

WWW.BRITISHCHAMPIONSSERIES.COM

OR CALL 0870 727 1234

Punter | Racing

CITYA.M. 7 OCTOBER 201138

RACING TRADER BILL ESDAILE, OUR RACING TRADER, WITH HIS BEST BETS OF THE WEEKEND

Ashbrittle looks massive at 33/1to land Cesarewitch for Beckett

NEWMARKET stages its ‘FutureChampions Day’ tomorrow withfour Group races for two-year-oldsfeaturing both the Dewhurst and

the Middle Park Stakes. The latter is first up at 2.35pm over six

furlongs and my eye was immediately drawn to French raider FAMILY ONE at ageneral 7/2. He’ll be making his seventhstart of the campaign tomorrow, but

brings arguably the best form to the table

and hasn’t finished out of the first two inany of those races.

Our selection finished second toDabirism in the Prix Morny last time andthat colt produced a scintillating turn of foot to win again on Arc day last Sunday.Family One was a clear second to him inthe Morny with the likes of Sofast andFrederick Engels behind him and a repro-duction of that run would make himhard to beat.

There has been lots of money all week for Richard Hannon’s Bronterre in theDewhurst (3.10pm) and he is now Ladbrokes’ 3/1 co-favourite with Roger

Varian’s Ektihaam and Aidan O’Brien’sPOWER having been available at twicethose odds earlier in the week. He wasmightily impressive when winning a Listedcontest at Goodwood last time, but needsto step up again to take a hand here. I’drather stick with the Ballydoyle Coventry Stakes winner, who has the best form inthe book, but Ektihaam is a danger.

Finding the winner of tomorrow’s big betting race, the Betfred Cesarewitch, isno easy task – only two winningfavourites in the last 18 years is plenty proof of that.

Nicky Henderson’s Royal Ascot winner Veiled heads most lists at around 10/1, buthe races off a 7lb higher mark and I justhave the feeling he was allowed to slip thefield in the Ascot Stakes. Cosimo DeMedici was only raised 4lb for lastmonth’s trial win over course and dis-tance, but that didn’t look the strongest

of renewals and he now holds no secretsfrom the handicapper.

Sir Mark Prescott seems to target thisrace every season with an unexposed typeand Tuscan Gold flies the f lag for the sta-

ble tomorrow. He may well be a lot betterthan his mark of 86, but, perhaps surpris-ingly, his trainer has never won this raceand this fellow is still pretty short at 9/1

with Ladbrokes.Buy Back Bob appears to be a typical

Tony Martin plot and may well start con-siderably shorter than the 16/1 generally available. The four-year-old has had onerun over hurdles and a spin on the flatover a mile, but you can be sure this racehas been the plan all along. There may bea nice back-to-lay trading opportunity

with Betdaq, but on the balance of hisform he has a mountain to climb.

With a field of 30 plus runners it’s sen-sible to throw more than one dart at the

board and my first fancy for the race isRalph Beckett’s unexposed ASHBRITTLE.

The four-year-old son of Rainbow Quest will be having only his ninth career start, but I’m pretty sure we haven’t seen the best of him yet and he may be well treat-ed off a mark of 90.

He seemed to relish the step up in tripto 15 furlongs when winning atDoncaster on his final start last seasonand blatently blew up on his reappear-ance at Haydock back in May. He was beat-en out of sight when enduring anightmare passage in the Ascot Stakes

behind Veiled, but was drastically eased when his chance had gone.

His latest eye-catching run behindBauer over an inadequate 14 furlongs atHaydock would have put him spot on forthis and at 33/1 with Ladbrokes, he looksan outstanding each-way bet.Connections reach for the headgear again(he was successful the only previous timethe visor was applied) and this will helphim travel, concentrate and quicken up atthe business end. Stall 26 isn’t ideal, but

he has been held up in the past and we’llhave to hope the gaps appear for JimCrowley at the right time.

My second fancy is David Pipe’sBEYOND who bolted up on his first run onturf on the flat at Sandown in July. He ispotentially a lot better than he hasshowed so far and the stable know how toready one for this (David’s father Martin

won it twice). He is another who lookspotentially over-priced at 12/1 with

Ladbrokes, especially from a decent draw in stall three.

Looking elsewhere on the card and I’mprepared to give John Gosden’sMAQAASID another chance in the open-ing Challenge Stakes over seven furlongs.She hated Goodwood last time and isreportedly in good heart after a break.She looks decent each-way value ataround the 7/1 mark.

There’s just a week to go until the cli-max of the QIPCO British ChampionsSeries at Ascot and Sir Henry Cecil cur-rently tops the Trainers League Table

with six wins, three seconds and a third.He already seems to have one hand on thetrophy as Frankel, Twice Over and Midday are all set to feature next weekend.

As for the battle to be top jockey, TomQueally currently sits at the top with five

winners and three seconds. FrankieDettori is within touching distance,though, and you can read all his thoughtsabout his Champions Day rides in nextFriday’s Punter.

You can follow me on Twitter@BillEsdaile.

POINTERS...

MAQAASID e/w 2.05pm Newmarket (Sat)

FAMILY ONE 2.35pm Newmarket (Sat)

POWER 3.10pm Newmarket (Sat)

ASHBRITTLE e/w 3.50pm Newmarket (Sat)

BEYOND e/w 3.50pm Newmarket (Sat)

8/4/2019 Cityam 2011-10-07


8/4/2019 Cityam 2011-10-07


CHELSEA chairman Bruce Buck hasresponded to criticism from theclub’s fans over its plans to buy thefreehold to Stamford Bridge, insistingthose who blindly oppose moving to anew stadium are wrong.

Some shareholders in the support-er-led group Chelsea Pitch Owners(CPO) have accused the Blues of trying

to rush through a deal to buy back the freehold. Others simply do not

want to agree to a sale that wouldremove a major hurdle to the clubleaving its home of 106 years.

Buck said: “We do not expect every fan or pitch owner to say yes from day one. There will be some who disagree with this. There is a small group who want to stay at Stamford Bridge notmatter what. I understand that but Ithink they’re wrong.”

CPO members will vote on the

offer, which equates to money back plus ticket incentives, this month.

SPORTS Minister Hugh Robertson hasurged the Football Association toreconsider their decision to restrictthe search for the next England man-ager to only English candidates.

Appetite for a home-grown candi-date is high within the FA as they con-sider who should replace FabioCapello after next summer’s

European Championships.But Robertson believes football

could learn from the England cricketteam, who have enjoyed huge successunder the guidance of Zimbabwe- born head coach Andy Flower.

“It should be the best person avail-able,” Robertson told the Leaders inFootball conference in London yester-day. “It would be nice to have anEnglish manager but what footballfans want is to win tournaments.Look at the England cricket team:

they’re top of the world and no-onecares Andy Flower is Zimbabwean.”

Buck: Chelsea fans deadagainst move are wrong

Financial Fair Play not fair, says Gazidis

FOOTBALL▲

ARSENAL chief executive Ivan Gazidis

insists so-called Financial Fair Play rules are not fair at all but does believe they will make the PremierLeague a more open competition.

Gazidis firmly supports Europeangoverning body Uefa’s drive to makeall clubs live within their means, which came into effect this year.

However he concedes the regulato-ry system will not create a level play-ing field, arguing it will insteadimprove the health of football as a

whole. “I don’t like the termFinancial Fair Play. It lends itself to being attacked because people say it’snot fair,” Gazidis said at the Leadersin Football conference in London yes-

terday.“None of the systems that youmight create are fair and none of them are going to be. We’re not on alevel playing field now and we won’t be if FFP is implemented either. Tome it’s not about fairness or levelplaying field.

“None of the systems that may beestablished for the future of footballis going to be perfect. They all havedrawbacks and loopholes. I think it’s

very important we keep an eye onthem. They should not be set instone, they must evolve and developas the game evolves.”

Stoke chairman and Bet365 tycoon

Peter Coates joined those questioning whether FFP will prevent smallerteams challenging the elite, saying:“The downside is that it reinforcesthe people at the top.”

But far from tightening the elite’sstranglehold, Gazidis believes the benefits FFP affords to a vast swatheof clubs will create a more competi-tive environment.

He added: “I think it will attractstrong, very capable ownership into

clubs that are, at the moment, strug-gling to attract investment.

“There are many clubs in this coun-try that have enormous potentialthat could be unlocked. But is it

going to be done in a year by buyingplayers? No. There has to be a longer-term plan.

“I don’t agree it locks in the hierar-chy; I think what we have now ismore predictable. No club wants asystem that locks in the current hier-archy forever. If you’re at the top it’snot healthy.

“I don’t believe it’s healthy in Spainto have Barcelona and Real Madridlocked into the top two positions.”

BY FRANK DALLERES

BUSINESS OF SPORT▲

BRITISH Olympic chiefs have warnedthey will not drop their controversiallifetime ban for drug cheats despitethe threat posed by a landmark European legal case that experts havelikened to the Bosman ruling.

The Court of Arbitration for Sport(CAS) yesterday ruled in favour of American 400m runner LaShawnMerritt, who argued that anInternational Olympic Committee(IOC) rule banning him from London2012 was illegal.

Merritt bulldozed the IOC rule that bars from the next Games an athlete who has received a doping suspen-sion of more than six months by arguing it exceeded the two-year bandecreed by the World Anti-Doping Authority (Wada).

His success also paves the way forchallenges to the BOA’s by-law, which bans for life from the Olympics any athlete found to have doped and alsogoes beyond Wada’s stipulations.

Sprinter Dwain Chambers andcyclist David Millar are among thoseBritish competitors who could seek to follow Merritt and have their life-time bans overturned. Both were lastnight considering their options.

But BOA chairman Lord Moynihandefended the “tough but fair” ban,arguing that its inclusion of anappeal system, unlike the IOC, ren-dered it subtly different in law.“Fundamentally, the BOA by-law addresses eligibility and is not a sanc-tion,” he added. The BOA have writ-ten to the IOC seeking urgentclarification but said in a statementthat their strict regulations had thesupport of more than 90 per cent of British athletes and Wada.

However, Simon Boyes, a sports law expert at Nottingham TrentUniversity, believes the CAS verdictagainst the IOC could be as far-reach-ing as football’s paradigm-changingBosman ruling, which granted play-ers freedom of movement when theircontracts expire.

“There is some chance that theBOA by-law might survive but it’s a very slim one,” he told City A.M.

“In many respects this verdict isnot dissimilar to the Bosman case.Fundamentally it shows the IOC issubject to challenge. It was pretty impervious beforehand and this is alandmark case. It’s potentially embar-rassing for the BOA and you might wonder if they have dug their heelsin too long and missed the opportu-nity to back down earlier.”

BY FRANK DALLERES AND JAMES GOLDMAN

OLYMPICS▲

Capello successor can beforeign, says Robertson

Sport40 CITYA.M. 7 OCTOBER 2011

Results

email [email protected]

SPORT | IN BRIEF

Hamilton protests his innocenceFORMULA ONE: Britain’s under-fireLewis Hamilton has defended his drivingstyle this season which has drawn signif-icant criticism from his peers. TheMcLaren star has been in trouble for aspate of incidents, including a clash with

Ferrari’s Felipe Massa at the last race inSingapore. “I’m not doing anythingwrong. I’m trying my best to avoid thosethings but I’ve been in awkward posi-tions this year,” said Hamilton ahead of Sunday’s Japanese Grand Prix, whichcould see Sebastian Vettel clinch back-to-back world titles should the Germanclaim just a solitary point from the race.“I’m trying my hardest. I’m still here,still fighting, and I’m not giving up.”

Akmal brothers named in courtCRICKET: Three more Pakistan playershave been named in court in connectionwith alleged spot-fixing offences at thefourth Test against England last sum-mer. It has been alleged that UmarAkmal, his brother Kamran and WahabRiaz would follow instructions from theagent Mazhar Majeed, who has beencharged with accepting corrupt pay-ments. The names were aired on the

second day of the trial involving SalmanButt and Mohammad Asif.

Murray advances in JapanTENNIS: Britain’s Andy Murray hasmoved into the quarter-finals of theJapan Open with a 6-1, 6-2 victory overAmerican Alex Bogomolov Jr. Defendingchampion Rafael Nadal beat MilosRaonic 7-5, 6-3.

Merritt case

is athletics’Bosman rule

FOOTBALL▲

Chambers wasbanned for two years in 2003

Picture: ACTION IMAGES

8/4/2019 Cityam 2011-10-07


Sport 41CITYA.M. 7 OCTOBER 2011

MIKE TINDALL has been a fan-tastic servant to English rugby

but I’d venture to say the deadleg which has ruled him out

of tomorrow’s World Cup quarter-

final against France may just havemade life easier for manager Martin

Johnson.England have been nowhere near as

poor in this tournament as has beendocumented, but certainly they’ve yetto hit the heights of the Six Nationsand the inclusion of Toby Flood nextto Jonny Wilkinson, at the expense of

vice-captain Tindall, offers significanthope that we’ll see the Red Rose openup against Les Bleus.

I’m genuinely excited by the poten-tial a Wilkinson-Flood axisprovides, even if it’s a com-

bination that might nothave taken to the fieldhad Tindall been fit.

When Flood came onagainst Scotland last week he really added widthto England’s play and his presence

will benefit thelikes of Chris

Ashton, while Wilkinson’sd e f e n s i v eprowess – I’dexpect him toline-up at centre

when Francehave the ball –should never beunderestimated.

It will be inter-esting to see who

takes the responsibility in the goal-kicking department. Wilkinson’spedigree and track record would nor-mally see him pull rank over the

young pretender, but he has beenuncharacteristically wayward so farand really struggled with the new

ball.If it’s the case, I’m a fan of the sug-

gestion that the two will stage a behind closed doors penalty shoot-outto determine who gets the nod.

I think anything that adds a bit of variety to the training methods will benefit the guys and I doubt it willunduly affect or undermine whoevercomes off second best.

Whoever gets the vote, it’s vital

they’re on target, however, particular-ly early on against a France side whocould wilt if they are put under pres-sure from the off. They really are in astate of disarray and I’d pin theresponsibility for that on their coachMarc Lievremont.

He’s really undermined the playersthrough the press and he doesn’tseem to have any consistency in termsof selection. It’s a complete mess andthe fact a team packed with so many potential match-winners could per-form so poorly against Tonga reflectsmore on the inadequacies of thecoach than the players.

That said, playing France alwaysrepresents one of the hardest fixturesin international rugby because yousimply don’t know what you’re going

to be lining up against. Normally you can prepare in a struc-

tured way and analyse theother teams’ strengths and weaknesses, but that’s not

the case with France andcertainly the teamthey’ll put out in Auckland.World Cup winner Kyran

Bracken (@kyranbracken)was speaking courtesy of

GamePlan Solutions: managing high profile and popu-

lar sport stars; speakers, leaders,motivators and ambassadorswww.gameplansolutions.co.uk

Tindall injury mayprove a blessing in

disguise for England

Balancing act reapsrewards for Gatland

RUGBY WORLD CUP COMMENT

KYRAN BRACKEN

HEAD coach Warren Gatland believes his side’s perfect blend of youth and experience will propel Wales to their best ever World Cupfinish.

Wales have made it to the semi-final stage only once previously back in 1987 when the competition, thefirst ever World Cup, was also held inNew Zealand.

An Ireland side, who have already lowered the colours of Australia inthis tournament, stand in the way of

Wales equalling their previous best,and Gatland could hardly be accusedof being conservative in his selection

with such a big prize on offer.

Eight of the Kiwi’s matchday 22 forthe quarter-final showdown are aged23 or under with the likes of JamesHook, Lee Byrne, Stephen Jones andRyan Jones missing out.

“The nice thing is I feel we have a balance we haven’t had before,” saidGatland. “We’ve got players who canget us across the gain line.

“We’ve got pace out wide, we’vegot pretty special youngsters, we’vegot loose forwards that can carry,loose forwards that can compete onthe ball, a couple of big second-rowsand a more experienced front-row as

well.“We feel the balance of this team is

the best we have ever had. What has been great is some of the older play-ers know they’ve got youngsters ontheir heels that are really biting attheir ankles. That has brought the

best out of some of our older, moreexperienced players.

“It’s a great position to be in to behaving to make hard calls about who

you leave out.”Flanker Dan Lydiate’s return from

an ankle ligament injury meansGatland can reunite an outstanding

back-row of Lydiate, skipper Sam Warburton and No8 Toby Faletau.

“What has been great about this World Cup is that we’ve got a lot of youngsters with no fear factor,”Gatland added. “They have got nohistory as well.”

BY JAMES GOLDMAN

RUGBY UNION▲

IRELAND winger Keith Earls hasrevealed he has “a strange feeling”that they will beat Wales on Sunday and go all the way to the World Cupfinal.

Not for Earls the sportsman’s clicheof taking each game as it comes; the24-year-old has already visualisedIrish glory and has dared to admit it.

“I have this strange feeling insideme where it feels like everything is

going right,” said the Munster andLions star.

“Everything went right in thegroup and everyone is so happy. Ikeep imagining ourselves in the final.I’m concentrating on playing Wales,

but it is a strange feeling I have.”Hooker Rory Best was yesterday

named in Ireland’s team despiteongoing concern over a shoulderinjury. Ronan O’Gara and ConorMurray retain the half-back partner-ship, with Jonathan Sexton and EoinReddan on the bench.

STRANGE FEELING | Earls has premonition

Earls says he hasimagined Irelandin the final


BY FRANK DALLERES

RUGBY UNION▲

8/4/2019 Cityam 2011-10-07


Sport42

THE BREAKDOWN |WORLD CUP BRIEFS

MCCAW FIGHTING FITNEW ZEALAND have confirmed cap-

tain Richie McCaw will play throughthe pain barrier against Argentina onSunday. McCaw was forced to pullout of the final pool game againstCanada as a precaution due to a long-standing foot injury. However, the tal-ismanic flanker will return to the AllBlacks line-up for the quarter-finalshowdown. “He’s great,” said AllBlacks assistant coach Steve Hansen.“He’s going to play on Sunday. We’redown to the business end and whilstwe’re still in the tournament he’ll beavailable. We’re just going to have tomake sure we do what we’ve donewith him all year and what he’s doneat the Crusaders and manage it.”

BOTHA BLOW FOR HABANABakkies Botha could have played hislast game for South Africa afterinjury ended his World Cup. Botha(inset) had missed the

encounters withWales andSamoa buthe hadhoped toreturn toactionagainstAustralia inSunday’s lasteight showdown.Wing Bryan Habana, passed fit toplay, admitted the mood in the worldchampions’ camp was subdued uponhearing the news of Botha’s demise.“Bakkies had a talk to the team thismorning and it did get a little bit emo-tional,” Habana said. “Yes, it was a bitsombre in the team room. It’s toughon the team.”

FRANCE TARGET WILKINSONJONNY WILKINSON will be targetedby France in tomorrow’s quarter-finalat Eden Park. Wilkinson has beennamed at fly-half by Martin Johnsonfor the last eight clash, despite aseries of unconvincing displays in thetournament thus far. And Franceflanker Julien Bonnaire believes LesBleus can take advantage of Toulonplaymaker Wilkinson's selection. Hesaid: “He, as well as the others, is notas good under pressure. It’s down tous to show more aggressiveness sothat he doesn’t put his team forward.”

Wilkinson and

Flood selectionnot a gamble,says Johnson

ENGLAND manager Martin Johnsonhas denied gambling with England’s World Cup future by persevering with an out of sorts Jonny Wilkinsonand shunting Toby Flood to insidecentre for tomorrow’s crunch quar-ter-final against France.

Johnson, ahead of the biggest gameof his managerial career, has takenthe bold decision to promoteLeicester No10 Flood in the absence of the injured Mike Tindall, rather thanopt for the safety first route of recall-ing natural centre Shontayne Hape.

That also means a reprieve for World Cup winner Wilkinson, whoseplace-kicking against Scotland and Argentina was some way short of thenear flawless level England havecome to rely on.

Despite opting to field such anunexperienced and experimentalcombination in a match of such mag-nitude, not to mention one thatcould determine his own future, Johnson insisted he had faith in hisselection

“It’s not a gamble,” he insisted.“You always put a lot of thought into your selections, no more so than when you’re in a World Cup quarter-

final. It’s one of the options we’ve got.“I think Mike and Manu Tuilagi

have played well together. If we had toplay Shontayne; there’s always an

argument to play him.“It does give us some different

things that we can do on the field when we play those guys [Flood and Wilkinson].”

England are not the only ones whohave attempted to spice things up, with France coach Marc Lievremontpersisting with Morgan Parra at fly-half, and Wilkinson believes havingan extra playmaker in the ranks willhelp expose Le Bleus’ makeshift No10.

“Having Toby there is hugely reas-suring, less in terms of having a[goal‐kicking] safety net than know-ing there is always going to be some-one there making decisions,”admitted Wilkinson.

“If I’m at the bottom of a ruck there’s going to be someone elsethinking as a 10. When two of us arethere you’ve got one guy scanningthe field and the other guy lookingfor the ball. Communication betweenus is going to be important.”

With France having been humiliat-ed by Tonga last week Johnson, meanwhile, admits it’s vital England rollup their sleeves and impose them-selves on confidence starved oppo-nents right from the f irst whistle.

“There’s no one more frustratedthan us about not imposing ourselvesearly on,” said Johnson. “We haven’tdecided those halves. As [backs coach]Brian Smith says. We’ve been takingit rather than giving it.”

BY JAMES GOLDMAN

RUGBY UNION▲

ENGLAND

FRANCE

Wilkinson and Flood played together at Newcastle

Picture: GETTY

8/4/2019 Cityam 2011-10-07


43

Rooney backed for Montenegro

mission despite off-field drama

www.welbeckgroup.co.uk

Email: [email protected]

Speak to one of our expert advisers

call us on 020 7776 2135

TACKLING YOUR FINANCES

HEAD ON!

TOMORROW sees London Scottish takeon last season’s relegated Premiershipside Leeds Carnegie at the AthleticGround. It’ll be interesting to pit our-

selves against a team that was playing toplevel rugby last season.

This will be our fifth game of theChampionship season, which, when youinclude pre-season and cup matches, meansthat we have played 10 first XV games so far.It’s only natural, then, that teams are start-ing to pick up injuries by this time of year.

A general rule of thumb is that, at moststages of a season, you’ll have roughly 20 per

cent of your squad out injured. That tallies

with our situation at present. You need luck to ensure your team is at itspeak for big games – but there are ways of

being luckier. Although it’s impossible tolegislate for contact injuries, the club’s med-ical team try to manage the workload toensure non-contact injuries such as strainsand muscle pulls are kept to a minimum.

The other method is to plan effectively. Itis important there is enough depth in yoursquad. If you are reliant on one or two super-stars it’s vital to manage them so they are fitat the critical parts of the season, but alsohave enough game time so they are in form.

A great example of this is how New Zealand respond to Dan Carter’s injury atthe World Cup. He’s absolutely critical tothem – because he is such a great player butalso as the All Blacks haven’t found an effec-tive replacement for him yet.

In a country as rugby obsessed as New Zealand there will probably be a publicinquest into the nature of Dan’s injury, espe-

cially considering it occurred during train-ing. He tore the left adductor muscle while

practising place-kicking, which will be frus-

trating for the coaching staff who willundoubtedly be asking: could we have doneanything to prevent it?

His loss to New Zealand and the tourna-ment cannot be overestimated and the otherseven nations in the quarter-finals will allfeel they have got a better chance of liftingthe cup now that he is out.

The England-France game will be especial-ly interesting this weekend. Although muchhas been made of how poor the French have

been, they are a team that, if everythingclicks, can beat anybody on their day. Much

will depend on how eccentric their teamselection is but I think England are slightfavourites. It is definitely game on!

Simon Amor is Head Coach at London Scottish.Their next game is against Leeds Carnegie tomorrow at 3pm, Richmond Athletic Ground.

Carter injury is World Cup leveller

RUGBY UNION COMMENT

SIMON AMOR

MANAGER Fabio Capello insists thearrest of Wayne Rooney’s father inconnection with an alleged bettingscam will not distract his talismanfrom shooting England into Euro2012 tonight.

Rooney is expected to start inMontenegro, where a draw will be

enough to confirm England’s place atthe top of Group G and book theirspot at next summer’s finals inPoland and Ukraine.

“I spoke with Wayne. I found himrelaxed and calm. There is no prob-lem for the game againstMontenegro,” Capello said yesterday.“He is sure a solution will be found tothis personal problem in a very shortspace of time.”

Captain John Terry, himself nostranger to playing in the midst of off-field controversy, backed Rooney to

brush the episode aside and maintainhis superb early-season form inPodgorica.

“It is important for him to go outthere and play his football, which heloves doing,” said Terry. “He willalways be fully focused on the pitch.

That is all that matters to us. When you are on the pitch or training pitch, you can switch off from anything inlife. Tomorrow’s game is the mostimportant thing. We all realise that.”

Capello is keen to cement qualifica-tion with a win, but said he was stillto decide who would partner Rooney in attack. Manchester United young-ster Danny Welbeck, Liverpool’s Andy Carroll, Fulham’s Bobby Zamora and

Aston Villa’s Darren Bent are all inthe frame.

The Italian was more certain of hisintentions post-2012, confirming thathe would be leaving his role regard-

less of the team’s success at the tour-nament. “Yes, I am leaving.

Absolutely,” he said. “The solution forthe next England manager is in thehands of the Football Associationchairman. I hope I can help Englandto play in the Euros. Then I will want

to drink with my friends, the playersand all who work with me.”

Rooney’s father, also called Wayne,last night denied involvement in a

betting scam after being one of ninepeople arrested and then bailed until

January by Merseyside Police.

BY FRANK DALLERES

FOOTBALL▲

MONTENEGRO

ENGLAND

TINDALL’S INJURY MAY PROVETO BE BLESSING IN DISGUISEWORLD CUP WINNER KYRANBRACKEN’S BIG GAME VERDICT: P41

Venue: Eden Park, AucklandDate: Tomorrow

Time: 8:30am BSTTV: Live on ITV1

ENGLAND15. B Foden (Northampton Saints)14. C Ashton (Northampton Saints)13. M Tuilagi (Leicester Tigers)12. T Flood (Leicester Tigers)11. M Cueto (Sale Sharks)10. J Wilkinson (Toulon)9. B Youngs (Leicester Tigers)1. M Stevens (Saracens)2. S Thompson (London Wasps)3. D Cole (Leicester Tigers)4. L Deacon (Leicester Tigers)5. T Palmer (Stade Francais)6. T Croft (Leicester Tigers)7. L Moody (Bath Rugby, capt)8. N Easter (Harlequins)

Replacements: D Hartley (NorthamptonSaints), A Corbisiero (London Irish), CLawes (Northampton Saints), S Shaw

(Unattached), J Haskell (Ricoh BlackRams), R Wigglesworth (Saracens), MBanahan (Bath Rugby)

FRANCE15. M Medard14. V Clerc13. A Rougerie12. M Mermoz11. A Palisson10. M Parra9. D Yachvili1. JB Poux2. W Servat3. N Mas4. P Pape5. L Nallet6. T Dusautoir (capt)7. J Bonnaire8. I Harinordoquy

Replacements: D Szarzewski, FBarcella, J Pierre, L Picamoles, F Trinh-Duc, D Marty, C Heymans

WORLD CUP FORMArgentina 9-13 ENGLANDENGLAND 41-10 GeorgiaENGLAND 67-3 RomaniaENGLAND 16-12 Scotland

FRANCE 47-21 JapanCanada 19-46 FRANCENew Zealand 37-17 FRANCEFRANCE 14-19 Tonga

ENGLAND V FRANCE | MATCH FACTS

Rooney scored inlast month’s winin Bulgaria


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