cityam 2012-02-21

8/3/2019 Cityam 2012-02-21

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FTSE 100 ▲5,945.25 +40.18 DOW CLOSED NASDAQ CLOSED £/$ 1.58 unc £/¤ 1.20 unc ¤/$ ▲1.32 +0.01

Talks over

Greek dealdrag intosmall hours

TALKS over a Greek bailout spilled intothe early hours of this morning asnegotiators edged closer to a deal tocut Greek debt to a sustainable level.

Japanese markets opened loweafter hours of wrangling in Brussels were yet to produce a deal.

Minister did agree on measuresexpected to reduce Greece’s debt to between 123 and 124 per cent of GDP by 2020 – within touching distance ofthe 120 per cent target.

Yet extra relief from lenders is need-ed to drag the rate down to the target-ed level. A report by the troika – theEuropean Union, European CentralBank and International MonetaryFund – predicted debt equivalent to129 per cent of GDP by 2020, even withthe planned reforms.

And if Greek authorities were tdelay reforms and austerity, debt couldsoar to 160 per cent of GDP by 2020.

Additional reductions would needto come from restructuring privately-held bonds and the ECB foregoingprofits on its holdings, the report said.

Officials suggested that private hold-ers were being asked to lose at least53.5 per cent on Greek debt.

Earlier in the evening talks hadstalled on demands that the troikahave “permanent representation” in

Athens – something Greek ministeGiorgos Papakonstantinou later toldNewsnight there was “no issue” with.

MORE ON EUROZONE: P8-9

BY JULIAN HARRIS

EUROZONE▲

Mahmoud Ahmadinejad has banned oil exports to the UK and France, further inflaming relations Picture: GETTY

OIL prices surged yesterday after adefiant Iran banned sales to Britainand France, amid growing fears overthe country’s nuclear ambitions.

Brent crude nudged over $121 a barrel – the highest level for eightmonths – as the International AtomicEnergy Agency (IAEA) arrived in Tehran to assess first hand the IslamicRepublic’s controversial nuclear pro-gramme.

Brent crude for April delivery set-tled up 0.4 per cent at $120.05, its firstclose above $120 since June.

Five inspectors have planned twodays of meetings to try and getanswers from Iran on whether itscivilian nuclear energy scheme is afaçade for researching atomic bombs.

The price of oil has climbed fromaround $106 a barrel at the start of the year on rising concerns over sta- bility in the Middle East.

The country is the world’s fifth-largest oil exporter and outrage overits nuclear efforts has provoked an EU boycott of Iranian oil, due to be trig-gered on 1 July.

Iran’s retaliatory ban on sales to

the UK and France is largely symbolic,since the two countries have already cut purchases, but the move is a signof increasingly strained relations.

www.cityam.comIssue 1,574 Tuesday 21 February 2012 FREE

FITNESSAL FRESCOHOW TO WORK

OUT IN THE GREAT

OUTDOORS P26

NHS REFORM: IS THEGOVERNMENT RIGHT?SPECIAL FORUM DEBATE P20

BUSINESS WITH PERSONALITY

China, which buys around a fifth of Iran’s oil exports, yesterday gave a rarecriticism of the country’s behaviour. A spokesperson said “we…do notapprove of exerting pressure or usingconfrontation to resolve issues”.

Iran’s deputy oil minister AhmadQalebani suggested the Western crack-

down would backfire, saying that intargeting Iranian oil the West hadachieved only a surge in crude pricesfrom $103 a barrel to $120, “and it will

reach $150”.GFT senior markets strategist David

Morrison said oil could rise to $127 a barrel as the crisis unfolds.

The IAEA yesterday said it was hop-ing for “concrete results” after claimsthat the Iranian regime has been hid-ing its true intentions behind a wall of

misinformation.But chief UN nuclear inspectorHerman Nackaerts warned thatprogress “may take a while”.

Certified Distribution

02/01/12 till 29/01/12 is 92,258

ANALYSIS l Brent Crude Oil

$

20 Jan 21 Feb

121

116

111

106

BY JOHN DUNNE & MARION DAKERS

ENERGY▲

OIL SURGES ONIRANIAN FEARS

8/3/2019 Cityam 2012-02-21


News2 CITYA.M. 21 FEBRUARY 2012

Laws: targethigh earnersDAVID LAWS, the former chief secre-tary to the Treasury, has mountedpressure on the chancellor GeorgeOsborne to raise the income taxthreshold to £10,000 in nextmonth’s Budget, saying it was timeto signal the end of austerity onhousehold budgets.

Laws told BBC’s Newsnight yester-day that the Liberal Democrats would fund the move – which wouldcost the Treasury some £9bn – by halving the higher rate of tax relief on pensions from 40 per cent to 20per cent.

The Lib Dems would target the topfive per cent of earners, whichequates to those earning around£60,000 and above, he said.

Laws, a close aide to Nick Clegg,

said high earners had done too wellout of the tax system, arguing thatall of the tax relief has gone to the very most affluent people in society.

“We can make changes that takeaway some of the subsidies that aregoing to the top one per cent or fiveper cent of the income distributionand get them to where they’re really needed – those on low and middleincomes”, he said.

Laws said increasing the incometax threshold would give the govern-ment the chance “of ending the aus-terity on household budgets.”

BYKASMIRA JEFFORD

POLITICS▲

Cameron needs to refocus his efforts

THE reformist credentials of this gov-ernment are looking increasingly shaky. The only area where realchange is taking place is education:Michael Gove, the secretary of state,and his uber-competent team, arepushing through a revolution, liberat-ing state schools from local authority control, allowing new schools to be setup by outsiders, improving standardsand finally beginning to turn arounda 40-year collapse in standards. They are the only success story; other minis-ters should look and learn.

In other areas, reform is in retreat.

The shake-up of the NHS is mired inchaos – the whole project looksdoomed. And if it isn’t eventually ditched, the electoral consequencescould be disastrous: the government

has failed to sell its changes and votershate them. The coalition should quiet-ly have intensified and expanded theNHS reforms launched by Labour, which were far more radical than usu-ally understood, rather than seekingto reinvent the wheel.

That said, those who claim the NHSreforms will destroy UK healthcare are wrong – the sorry truth is that they won’t make much of a differenceeither way. It would be better for thegovernment to abandon them entire-ly, sack the beleaguered health secre-tary Andrew Lansley and focus onother things. The NHS is not goodenough when compared with healthsystems in countries such as theNetherlands, Germany or Singapore –and will face a huge, terminal crisis within a decade as an impoverishedUK state becomes unable to keep up

with increasing costs. But tragically that will now have to be a battle foranother time. The coalition would be better off dedicating itself to salvaging welfare reform, which faces political

and logistical difficulties that many ingovernment appear to have under-esti-mated. David Cameron needs to refo-cus his government’s efforts if hedoesn’t wish to be remembered as aprime minister who merely tinkeredaround the edges of the welfare state.

PAY DEALSIMAGINE everybody thought yourcompany made £1bn in the last finan-cial year – and you, as its boss, wererewarded accordingly – when in fact itonly made £500m because whatseemed like good decisions at the timeturned out not to be that great. Youmight be happy, but your sharehold-ers certainly wouldn’t be. It makessense, therefore, in some circum-stances, to defer and spread bonuspay-outs over several years to makesure that there is enough time to

assess the outcome of decisions. If they turn out to have been as good aspreviously thought, the entire sum ispaid out over three years; if not, thenthe deferred bonus can be withheld.

It’s an obvious mechanism to makesure incentives are aligned to real,long-term performance and has become the norm in the City; LloydsBanking Group has become one of thefirst to make use of it, as a result of provisions for PPI mis-selling material-ly altering its past performance. Theonly problem is the terminology used– bonuses are said to be clawed-back, which is misleading. By definition, thedeferred components were never paidout and were never guaranteed – they are therefore not being recoveredfrom bank accounts. Rather, futurepayments are not now going to bemade because the conditions requiredare no longer met. All pretty sensiblestuff – it’s hard to know what all thefuss is about.

[email protected] Follow me on Twitter: @allisterheath

THE UK Border Agency is to be dis-mantled, after a critical report foundhundreds of thousands of people had been allowed into the country with-out full security checks.

Home secretary Theresa May toldparliament yesterday that the UK Border Force, responsible for the day-to-day operations of the borders, would be split from the wider Border Agency, which also covers immigra-

tion policy. The Force will be put under the

control of a senior police officer, inorder to foster “a whole new manage-ment culture”, May said.

A government-ordered repofound that between 2007 and 2011, border staff waived some checks onaround 500,000 Europeans arriving via Eurostar.

The report by John Vine also foundthat border checks were regularly sus-pended without the properapprovals.

BYMARIONDAKERS

POLITICS▲

May splits Border Agency Home secretary Theresa May has shaken up border control after a critical report

NEWS | IN BRIEF

Directors cautious over economyOver a third (35 per cent) of companydirectors see a high or very high risk of the UK falling into recession this year,according to an Institute of Directorssurvey released today. The survey, whichquestioned 1,000 business leaders,found 53 per cent thought there was a

moderate risk of recession while 11 percent thought there was a low or verylow risk of two consecutive quarters of negative growth this year. However, 43per cent thought any recession would beshort and mild while a third that itwould be long and mild and only 17 percent believe it would be deep.

PM committed to NHS reformsPrime Minister David Cameron yester-day pledged to push ahead with con-troversial NHS changes after hishealth secretary Andrew Lansley washeckled outside Downing Street. Theirmeeting was to discuss proposals inthe Health and Social Care Bill, whichaim to give GPs greater control of theNHS budget and open up the healthservice to more competition from theprivate sector.FORUM: P20

EDITOR’S LETTER

ALLISTER HEATH

Editorial StatementThis newspaper adheres to the system of

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

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Liberal Democrat MPDavid Laws called onthe government totake more tax from thetop earners in the UK

4th Floor, 33 Queen Street, London, EC4R 1BRTel: 020 3201 8900 Fax: 020 7248 2711Email: [email protected] www.cityam.com

EditorialEditor Allister HeathDeputy Editor David HellierNews Editor David CrowActing Night Editor Marion DakersBusiness Features Editor Marc SidwellLifestyle Editor Zoe StrimpelSports Editor Frank DalleresArt Director Gavin BillennessPictures Alice Hepple

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The new jobs website for London professionalsWWW.CITYAMCAREERS.COM

US CORPORATES SHY TO OFFERGUIDANCEUS companies are more uncertainabout the future than at any pointsince the financial crisis, with justone in five of the country’s biggestcorporations making any predictionsas they published fourth-quarterresults.

TRANSOCEAN WILL NOT PROPOSE ADIVIDENDShares in Transocean, the owner of the drilling rig at the centre of the BPoil spill in the Gulf of Mexico, fellmore than six per cent on Monday,the biggest drop in two months, afterthe company said it did not plan topropose a dividend at its upcomingannual shareholder meeting.

WALMART RAISES STAKE INYIHAODIAN

Walmart is taking a 51 per cent stakein Yihaodian, a leading Chineseecommerce website, in a significantmove by the US retailer to boost itsonline presence in China. Walmartdid not disclose financial details forthe partnership with Yihaodian, oneof the fastest-growing companies inChina. But it already held a minority stake in the business.

URS AGREES TO BUY FLINT ENERGYEngineering consultancy URSCorporation has agreed to buy FlintEnergy Services, the Canadian oilfieldservices provider, for C$1.25bn(US$1.25bn) in cash as it pushes toconsolidate the fragmented $450bnsector. Buying Flint will increaseURS’s exposure to America’s hydro-carbon industry.

HIGH COURT TO SERVE CLAIM ONDEFENDANT VIA FACEBOOK A judge has given the go-ahead for aclaim to be served via Facebook in what is thought to be the first case of its kind in the English High Court. Mr Justice Teare approved the use of thesocial networking site after difficul-ties locating one of the parties in acommercial claim.

BIDDERS SHORT ON EXPERIENCE HEADEDINBURGH AIRPORT QUEUE The £500m auction of Edinburgh air-port has entered its final stages aftera shortlist of bidders was drawn up yesterday. It is understood some have been told already they are through tothe next round, having submittedindicative offers last Monday.

NO BLACKLISTING COSTLY DRUGS,TRUSTS TOLDHealth authorities are to be preventedfrom blacklisting expensive brandeddrugs under government plans to stop“postcode prescribing”. The NationalInstitute for Health and ClinicalExcellence (Nice) has produced a “bestpractice guide” which states that med-icines should be “automatically incor-porated” on lists of available drugs within 90 days of approval.

RUPERT MURDOCH SHOULD TAKE BACKNEWS OF THE WORLD STAFFRupert Murdoch has a “moral duty”to employ former News of the World journalists on his new Sun on Sunday title, according to the former chief reporter at the defunct tabloid.

TOP BANKS IN EU RUSH FOR SAFETY Top European banks, responding tonew regulations and wary of lending,are stashing increasingly large sumsof money at central banks around the world in a collective flight to safety. The eight giant European banks thathave disclosed their annual results inrecent weeks reported holding a totalof about $816bn in cash and depositsat central banks as of 31 December.

FORD PREDICTS MODERATE SALESGAINS IN CHINAFord expects China’s vehicle sales torise “about five per cent” in 2012, theauto maker’s regional head said, fore-casting a second year of relatively moderate growth for the world’slargest car market.

WHAT THE OTHER PAPERS SAY THIS MORNING

8/3/2019 Cityam 2012-02-21


A BIDDING war has erupted over Misysfollowing news of a potential £1.2bnoffer for the British software company less than two weeks after Temenosannounced its plans for an all-sharemerger.

Vista Equity Partners, officed in SanFrancisco, Chicago and Austin, isthought to have offered 360p per Misysshare – a 16 per cent premium onFriday’s closing share price of 310p.

Vista, which has until close of play

on 19 March to announce its intentionto bid or withdraw from the table, saidit was conducting due diligence onMisys.

In a statement, Misys verified theapproach “consisting of a non-bindingindicative proposal to acquire theentire outstanding share capital of Misys for cash that may or may notlead to an offer being made.”

This latest move has raised eye- brows, as Misys chief executive MikeLawrie plans to step down in March –

with the intention of leaving his firmin the hands of Temenos’ leadership.

But while Misys’ biggest shareholder ValueAct has voiced approval of the Temenos merger, the Swiss softwareprovider may have to raise the terms of its proposal in light of Vista’s arrival.

Despite the benefits of a strategicmerger with Temenos, an all-cash bid will appeal to Misys shareholders.

Temenos declined to comment.Shares in Misys jumped as much as

twelve per cent yesterday before drop-ping slightly to close at £3.30, valuingthe company at £1.04bn.

Vista wadesinto Temenosdeal for Misys NICK Clegg has lost his top economic

adviser just weeks before the govern-ment unveils its Budget, City A.M. haslearned.

Chris Saunders, who was employed by the deputy Prime Minister on asalary of £60,000 a year, quit his spe-cial adviser’s post on Friday and is cur-rently away travelling with his wife.

His departure means Clegg is with-out an economic adviser in the run upto the Budget on 21 March, leading tofears the party could struggle to influ-ence government policy.

A government spokesman said“After the best part of a decade work-ing for the Liberal Democrats, Chrishas left to travel the world. Hisreplacement will be announced indue course.”

In 2010, Saunders was named in

embassy cables sent by the US ambas-sador to Hillary Clinton, which wereleaked by Wikileaks.

The cables revealed that while inopposition Saunders had planned torun a fierce anti-Cameron campaign,describing him as “out of touch withreal life”. He dropped the plan afterthe death of Cameron’s son Ivan.

Saunders could not be reached yes-terday. His voicemail said: “I have now left my job and will be out of the coun-try until August.”

Clegg adviserquits weeksbefore Budget

BY LAUREN DAVIDSON

TECHNOLOGY▲

News 3CITYA.M. 21 FEBRUARY 2012

ANALYSIS l Misys PLC

p

14 Feb 15 Feb 16 Feb 17 Feb 20 Feb

350

340

330

320

310

300

330.1020 Feb

BYDAVID CROW

POLITICS▲

BURBERRY IMPRESSES AT FASHION WEEK

BRITISH fashion powerhouse Burberry unveiled its Autumn/Winter 2012 collection at London Fashion Week yesterday, bringing thunder, lightning and fake rain to its show in Hyde Park. Samantha Cameron and US Vogue editor Anna Wintour were among the famous faces in the front row, as the brand showed its “Town & Field” collection. Burberrysaw its pre-tax profits rise by 26 per cent to £162m in the six months to 30 September.

8/3/2019 Cityam 2012-02-21



THE RESTRICTED supply of property in the most popular areas inLondon has led to buyers payingpremiums of up to £100,000 abovethe asking price, according to areport published yesterday by estateagents Cluttons.

Domestic and foreign buyers haveenthusiastically invested in London,causing the stock of houses on themarket to fall by 25 per cent at the

start of 2012.

As a result, prices are soaring, theestate agent said, claiming that hotspots like Chelsea and SouthKensington have seen such strongdemand that deals are agreed with-in hours of a property coming ontothe market.

Furthermore, the agent reportsdesperate buyers paying premiums“in excess of £100,000 above the ask-ing price”, indicating home-huntersare confident prime property prices will keep rising.

“House hunters in prime central

London, starved of options, aregoing to great lengths to secure aproperty when it comes onto themarket, particularly those on themost desirable roads,” commentedCluttons’ Charlie Noel Buxton yes-terday.

“We believe registered demandunderestimates the underlyinglevel, with new instructions attract-ing a rush of applicants who aren’tregistering with agents until they see a property they like.”

Desperate buyers pay hugepremium on top propertiesBY TIMWALLACE

HOUSING▲

BELGIAN insurer Ageas announced anunexpected fourth quarter loss of €44.5m (£37m) yesterday as it wrotedown the value of its Hong Kong oper-ation and took a €124m hit on the value of its Greek bond holdings.

Without these impairments its

insurance division would have turneda full year profit of €595m, the firmsaid.

Overall insurance income decreased by four per cent in 2011 as it facedfierce competition from banking prod-ucts and state savings products in itslife assurance business.

However, year-end sales at its Britishsubsidiary were up almost 70 per centat £1,979m, earning £105m comparedto a £25m loss in 2009.

The firm only entered the UK mar-ket four years ago but has steadily builtits market share to 8.4 per cent thanksto acquisitions, organic growth andaffinity partnerships.

It now has more than 1.5m cus-tomers through ventures such as TescoUnderwriting, Kwik Fit FinancialServices and Castle Cover.

Barry Smith, chief executive of Ageas UK, told City A.M . he was delight-

ed with the results and praised “thequality of the profits” which could be

partly ascribed to the “financial advan-tage of our low-cost operation”.

“We won’t expect to see the samegrowth in 2012 and it will still be atough time for many customers. Wehave an incredibly strong team and will aim to grow quite naturally and where we see attractive growth.”

Ageas, which emerged from the break-up of Dutch-Belgian bancassurer

group Fortis, said it will propose a div-idend of eight cents a share at its nextannual meetings to be held in April –the same as the previous year.

The insurer will have €1.1bn of cashleft after the distribution and toldreporters yesterday it will prioritiseinvesting part of the cash pile in the business, followed by shareholder dis-tributions and debt buybacks.

Shares in the group closed down 1.5per cent at €1.69 last night.

Surprise loss

for Ageas onwrite-downsBY JAMESWATERSON

INSURANCE

ANALYSIS l Ageas SA

€


1.73

1.72

1.71

1.70

1.68

1.67

1.66

1.69

1.6920 Feb

▲

8/3/2019 Cityam 2012-02-21


BRITISH house-buyers looking toinvest abroad are increasingly will-ing to move outside of Europe,according to research fromPrimeLocation.com.

Searches on the website forSpanish properties plummeted 15per cent in the final quarter of 2011,compared with the previous quar-ter, the website said in figures outtoday.

Italy and France were close behind, with declines of 14 per centand nine per cent respectively.

Searches for Portugal fell nine percent, while Cyprus saw a 15 per centslump in real estate interest,PrimeLocation claimed.

Meanwhile searches for property in the United Arab Emirates rocket-ed 47 per cent, the US 25 per centand Australia 22 per cent.

“The UAE enjoy low rates of taxa-tion, a stable and wealthy economy and an attractive property market,so it’s easy to understand why many highly-paid professionals would be

tempted,” said Nigel Lewis fromPrimeLocation.com.

“However, buyers consideringmore far flung property marketssuch as the UAE should seek legaladvice to ensure they understandthe property laws in the country.”

In terms of overall searches,France remains UK buyers’ favoureddestination, while the US rose fromthird to second place on the quar-ter, overtaking Spain.

“Although places such as Spain,Portugal and Italy remain popularamong UK buyers demand for themis on the decline, which is not sur-prising given the ongoing sovereigndebt crisis in the Eurozone,” Lewis

explained.Germany, which is one of the

sturdier countries in the Eurozone,saw searches for its properties risetwo per cent between the third andfourth quarters.

And closer to home, wealthy investors from the Eurozone have

been flocking to central Londonreal estate to park their cash, send-ing viewings of prime property up25 per cent at the end of last year,according to Knight Frank.

House-hunterslook to UAE to

avoid Eurozone

NewsCITYA.M. 21 FEBRUARY 2012 5

UK MORTGAGE lending rose in January, compared with the samemonth of 2011 – the sixth consecu-tive month of year-on-year growth,according to data out yesterday from the Council for MortgageLenders (CML).

The CML figures showed lending was up 10 per cent, and theMortgage Advice Bureau (MAB) cor-roborated the jump this morning,publishing data showing the num-

ber of mortgage applications rose25.8 per cent on January 2011.

Gross mortgage lending hit£10.5bn in January, up from £9.5bna year ago but lower than the£12.2bn in December, CML said.

Buy-to-let mortgages have also been improving, edging up their

share of the market to nearly 13 percent in the fourth quarter of 2011,CML said.

The average loan to value of mort-gages stood at 72 per cent, and theaverage deposit rose to £56,167 from£52,284 last January, MAB reported.

“The new year has started com-paratively positively in spite of thegenerally negative economic situa-tion and low levels of consumerconfidence,” said Brian Murphy from MAB.

Mortgage loansup as recoverystays on track

PROPERTY▲

BY TIMWALLACE

PROPERTY▲

8/3/2019 Cityam 2012-02-21


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BANK of Ireland said yesterday it was attracting deposits, cuttingcosts and expected home loanarrears to peak this year, raisinghopes Ireland’s biggest lender hadturned a corner after a 60 per centdrop in operating profit in 2011.

The only Irish bank to avoidnationalisation after an unprece-dented property crash, Bank of Ireland said low interest rates wouldmake it harder to achieve its goalfor a net interest margin – the gap

between what it charges for loansand what it pays to borrow – of twoper cent in 2014.

But chief executive RichieBoucher was optimistic of progressafter the cost of drawing in depositsand an expensive government guar-antee of its liabilities trimmed themargin by 13 per centage points to1.3 per cent last year.

After successfully attracting private capital to meet strict new cen-tral bank targets last year, Bank of Ireland is focused on restructuringand weaning itself off state funds.

BANKING▲

Bank of Irelandkeeps depositsat lower cost

CREDIT CARD insurance firm CPPsays the Financial Services

Authority (FSA) could force it out of business, after the regulator askedfor a retrospective review of salestactics.

The company suspended itsshares on the London Stock Exchange yesterday after declaringthat the new demands “are dispro-portionate and threaten the viabil-ity of the business”.

The FSA yesterday said it is likely CPP “will be required to carry out apast business review of direct salesand, if appropriate, pay redress” asthe regulator enters the twelfthmonth of its investigation into alle-gations of mis-selling at the York-

based firm. Although both parties agree that

a business review is appropriate,

they disagree as to the extent of

the investigation. CPP claims theFSA’s demands could bankrupt a

firm that floated for £150m in2010.If the firm ceased trading it

would leave no money for possiblecompensation and put almost1,969 jobs at risk.

In a statement the regulatorsaid: “The FSA is committed toensuring consumers are protectedand that the firm treats its cus-tomers fairly.

“The FSA has serious concernsabout the manner in which cus-tomers were being sold identity theft and card protection policies

by the firm.”CPP now has two weeks to come

to an agreement with the FSA onthe form that any reappraisal willtake.

The firm has already suspendedsales of its identity insurance prod-uct and recently lost an important

contract with Barclaycard.

Henry Carvers, an analyst at PeelHunt, said the outlook is bleak: “If

the FSA holds its ground that effec-tively means paying back a lot of money to a lot of customers, whichcould be potentially crippling forCPP.

“It’s difficult territory,” he con-tinued. “Can you genuinely ascer-tain whether someone was dupedinto buying a product?”

Shares in the firm last traded at103p, down from 235p when itfloated in March 2010.

ANALYSIS l CPPGroup PLC

p


120

115

110

105

100

103.0020 Feb

CPP says FSA proberisks firm’s future

THE former Dresdner KleinwortInvestment Bank (DKIB) staff demanding €50m (£41.8m) inunpaid bonuses are seeking“rewards for failure”, the high court

was told yesterday. Tom Linden, QC, representing

parent company Commerzbank,said the “promise” by the Germanlender to pay a minimum bonuspool of €400m for 2008 was a “non-

binding commitment” and that ithad to cut payouts as its perform-ance deteriorated at the start of thefinancial crisis.

Linden said the writ, issued by 104 former staff, was “a claim to berewarded for the failure of DKIB in2008”.

Dresdner’s investment bank made a loss for that year andCommerzbank, which bought thedivision, was later bailed out by German taxpayers.

Dresdner parent Commerzbankdefends bonus cutting stanceBANKING

▲

THE FSA has fined Santander£1.5m for failing to label its finan-cial products clearly and being tooslow to respond when it discoveredthe fact.

The City watchdog says the bank did not sufficiently clarify whether

buyers of some products were cov-ered by a financial industry insur-ance scheme. The bank disagrees

but will not appeal.

BANKING▲

Santander gets£1.5m FSA fine

HSBC is to launch a £4bn fund that will lend to small and medium-sized businesses that trade interna-tionally.

The aim is to capture the benefitof increasing global trade conduct-ed by British SMEs with a turnoverof up to £25m.

The bank also published research

today forecasting that the UK’sinternational business activity willincrease by 60 per cent in the nextthree years.

The report predicts that Britishcompanies will export increasingly to Vietnam and Brazil and will

import more from Qatar. The industries expected to see the

most international growth are oiland gas, car manufacturing and

biotech.

HSBC launches £4bn fundto lend to exporting SMEs

HSBC’s Stuart Gulliver wants the bank to sit in between global trade flows Picture: GETTY

BY JULIET SAMUEL

BANKING▲

BANKS are urging the Treasury not toset a rigid target for its credit easingscheme because it risks “setting it upto fail”, a source involved in the discus-sions told City A.M..

In December, chancellor GeorgeOsborne laid out his plan to get creditflowing to small businesses by offer-ing £20bn in debt guarantees to

banks, so that they could pass on the benefit to small firms in cheaperloans.

But there is no clear sense of how tomeasure the effectiveness of the poli-cy in the real economy.

A source involved in the discussions between banks and the Treasury said:“There is no incremental estimate forhow much credit it will get into SMEs

[small and medium-sized enterprises].”Banks believe that if the Treasury

sets a target for how much it wants to boost credit through the scheme, itrisks going to the same way as the

Project Merlin deal with lenders, in which the government trumpeteddubious targets that were thenmissed.

It is understood that if it does set atarget, the Treasury is likely to favourone related to how much small firms’

borrowing costs have come downrather than a target based on how much more they have borrowed andinvested as a result.

Any target will rely on banks’ esti-mates of how much they have cut thecost of each loan and could be sector-specific depending on what kind of firm is borrowing the money.

“We’re working out the details of how to measure the tangible effects of the scheme,” said a Treasury spokesman.

One option is for the Treasury toaccept banks’ argument tacitly and

simply stick with the very loose goalalready stated of cutting SME creditcosts by “up to 100 basis points”. But itcould prove hard to measure success

by that benchmark.

Lenders opposedto easing targetBY JULIET SAMUEL

POLITICS▲

BY JAMESWATERSON

INSURANCE▲

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Former chief exec Eric Daniels

Former head of retail Alison Brittain

Former head of wholesale Truett Tate

Former chief financial officer Tim Tookey

WHY ARE LLOYDS DIRECTORS LOSING PART OF THEIR BONUSES?

Q.WHAT HAS LLOYDS’ REMUNERATIONCOMMITTEE DECIDED?

A.In response to pressure from theFSA, Lloyds has decided to “claw

back” a chunk of the bonuses itawarded to some senior executives toreflect the huge £3.2bn loss the bank has suffered as a result of mis-sellingpayment protection insurance (PPI) to

thousands of consumers. In autumnlast year, banks lost a high court casechallenging the FSA’s ruling that the way in which they sold PPI wentagainst the spirit of the rules at thetime and they should therefore pay out compensation to customers.

Q.WHAT IS THE BANK CLAWINGBACK?

A. Thirteen former senior executivesat the bank are having a portion

of their 2010 bonus awards cut for atotal value of £1.5m. But the bank isnot actually “clawing back” pay in thesense of getting money paid back.Instead, it is cutting down on its plansto pay out millions in “long-termincentive plans” – all-share bonusesdeferred over several years. The execu-tives are not actually losing assets

they already have; they are losingfuture rewards.

Q.WHO’S LOSING WHAT?

A.Former chief executive EricDaniels is losing 40 per cent of the

long-term bonus award he was givenin 2010, equal to £580,000. Four otherformer board executives –Truett Tate, Alison Brittain and Tim Tookey –arelosing 25 per cent each, altogether

nearly £1m. In addi-tion, eight otherunnamed executivesare losing five per cent for atotal of nearly £2m.

Q.WHY ALL THE FUSS?

A.

Aside from emphasising the sever-

ity of the PPI scandal, the FSA iskeen to establish a precedent for get-ting rewards back off executives topunish them for losses that emergeafter they have left. It is part of aneffort to align management incen-tives with the long-term health of the bank and tackle “short-termism”. Butit is open to the criticism that the FSA is prioritising issues that spark pop-ulist anger rather than those that ledto the bank seeking a bailout.

Q A&

Santander UKunable to get

back bonusesLLOYDS has announced plans to pun-ish its former management for lossesincurred due to a customer mis-sellingscandal – but its current executiveshave escaped a similar penalty fortheir role in the same scandal atSantander UK.

Santander UK, the former home of many of Lloyds’ current top execu-tives, has found itself unable to punishthe management that presided overmis-selling insurance because they gave up their long-term bonus whenthey left to join taxpayer-ownedLloyds. They instead received “goldenhello” awards worth the sameamount.

City A.M. understands thatSantander has sought legal advice on whether and how it can reflect the£538m hit it took compensating cus-tomers who were mis-sold paymentprotection insurance (PPI) by slashingpay-outs for the managers in charge atthe time.

But because the relevant execs – António Horta-Osório, AntonioLorenzo, Juan Colombás, and AlisonBrittain – gave up their long-termincentive-based bonus when they quitSantander UK for Lloyds, the bank hasnothing to reclaim.

All three received “golden hello”share awards to compensate for theloss of their long-term bonus whenthey joined the semi-nationalisedLloyds.

But they were not compensated forthe loss of their pension pots, which inthe case of Lloyds chief executive

Horta-Osório, was worth more thanthe “golden hello”. A spokesman for

Lloyds said: “It is worth rememberingthat António gave up very significantfuture earnings when he leftSantander to join Lloyds.”

The banks’ former executives, how-ever, are likely to be unimpressed by the slashes to their long-term bonusawards while their successors’ remainin tact.

Former chief executive Eric Daniels bore the brunt of the punishment: 40per cent of his long-term bonus wascut, equal to £580,000. Four otherdirectors are to lose a quarter of theirlong-term share bonus and eight more will see five per cent sliced off.

They are being punished for run-ning the bank when it mis-sold PPI tothousands of consumers and thenappealing against a high court ruling

on the matter, resulting in a total costof £3.2bn to Lloyds, which is expectedto wipe out its 2011 profits.

The bank said the decision by the board is “based on the fact that hadthe outcome of [PPI scandal] beenknown... individual bonus awards would also have been lower.”

Last night it was reported that RBSand Lloyds plan to ignore calls to claw back rewards in the wake of the PPIscandal.

ANALYSIS l Lloyds Banking Group PLC

p


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36.3520 Feb

BY JULIET SAMUEL

BANKING

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HUNGARY expects to arrange finan-cial backing from the EU andInternational Monetary Fund (IMF)

by the end of March, a senior econo-my ministry official said.

The country does not expect toneed international funding, but thesupport would help it access marketsagain at a time when it needs to refi-nance maturing debts.

Its government has argued withthe EU over a new constitution, butis now expected to compromise onsome issues.

Yesterday, Hungary’s parliament

voted in favour of joining the EU’slatest fiscal compact.

Hungary closer

to IMF support

French business

more confidentEU ECONOMY

▲

News 9

Spain’s Mariano Rajoy, Italy’s Mario Monti and DavidCameron all called for action on jobs Pictures: GETTY

up EU for jobs

argue – concluding just the deals cur-rently being negotiated, with coun-tries like Japan, China and Canadacould be worth €90bn (£75.2bn) to theEU’s GDP.

The letter also argued that banksshould take responsibility for theloans they make, rather than relyingon state support if they fail, and thatBasel III rules will help ensure the sta-

bility of the financial system.Crucially for Britain, the letter

made no mention of the proposedfinancial transactions tax, which theEuropean Commission favours imple-menting across the EU but Cameronopposes on the grounds it will dam-age the UK’s financial services sectorand simply drive banks to other glob-al financial centres.

economy set to growcountry’s construction sector.

The report said the impact of theEurozone crisis was not just being feltthrough lower exports but also higher

immigration from Greece, Italy, Spainand Portugal. They accounted foraround 10 per cent of net immigrationin the final quarter of 2011, when it

was roughly balanced in 2010.However, the Bundesbank did have

one word of warning for Merkel – her“fiscal consolidation aims thereforeappear very unambitious”, it said,arguing against any relaxation inGermany’s deficit reduction plan.

BUSINESS confidence in France heldsteady in February, according to sta-tistics agency INSEE, suggesting theeconomic slowdown may have bot-tomed out.

The business climate index stayedat 91 yesterday – below its long-termaverage of 100 for the sixth month ina row, but suggesting conditions areno longer deteriorating.

However Belgian consumer confi-dence declined sharply from minus16 to minus 20, its lowest level since

April 2009, the National Bank of Belgium said yesterday, blaming a

weakening employment outlook inthe export-dependent economy.

EUROZONE▲

Germanleader Angela Merkel

8/3/2019 Cityam 2012-02-21


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MORE NEWSONLINE

www.cityam.com

Banks can trip in search of a rise up the table

INVESTMENT bankers are pleased

with any pickings these days andin the past few weeks there has been healthy signs of action in

the world of block trades. This is a phenomenon whereby a

bank offers to buy a block of shares inone company and sell it on.

The idea is that, hopefully, the bank in question can line up a list of buyers of the stock at a price thatgives it, together with a fee for under-

taking the transaction, a healthy prof-it.But last week Morgan Stanley

found that it had to buy half the stakein Danish telecom group TDC itself,after it failed to find sufficient buyersfor the shares.

Morgan Stanley will now have todrip feed the shares onto the marketover the next few months at the risk of dampening down the price, or itcan take a decision to hang on for a while before selling them all in one

go. Morgan Stanley’s experience fol-lowed that of Citigroup, which the week before experienced similar diffi-culties selling down a parcel of sharesin Centrica.

It’s possible that both transactions

were just unlucky and that deals thatfelt do-able at the time suddenly turned wrong for inexplicable rea-sons.

But many in the market feel thetwo incidents indicate a willingnesson behalf of some banks to act tooaggressively in order to get the deal. This could be either to keep bankers busy or satisfy a desire to pick up mar-ket share in the all-important leaguetables that the banks all follow (or both of these reasons).

With the London IPO market stillnear dormant, and the Europeanones quietish, block trades are anincreasing focus for underutilisedequity capital markets teams. Andthere is strong demand from

investors who are underweight inequity risk assets, especially those with a European flavour now that thefear of a meltdown is receding.

There are rumours that LloydsBanking Group is once again evaluat-ing the possible sale of its 60 per centstake in the fund management groupSt James’s Place, though noannouncement is imminent. Alsothere is talk that the insurance group Aviva might be lining up buyers forits stake in Delta Lloyd.

The experience of the past few weeks demonstrates, however, thatsuch business does not come withoutrisks, no matter how many leaguetable points it might account for.

MOVES AT UBS Any day now, UBS is expected toannounce the successor to its head of EMEA equity capital markets PeterGuenthardt, who is being promotedto become the chief executive of theSwitzerland investment bank.

One theory is that his job will besplit by two people: Darrell Uden andChicco di Stasi, the current head of the bank’s strategic equities solutionsgroup.

[email protected]

INSIDE TRACK

DAVID HELLIER

OLYMPUS plans to promote execu-

tive officer Hiroyuki Sasa to the roleof president in April, according to Japanese reports.

Sasa, who has worked as head of development as well as marketing atsubsidiary Olympus Medical

Systems Corp, will be appointedpresident on 20 April, the Nikkeipaper reported.

Japanese prosecutors are now con-sidering indicting Olympus as acompany for falsifying its financialreports to conceal huge investmentlosses in a $1.7bn (£1.07bn) scandal,Kyodo news agency reported.

Olympus picks presidentTECHNOLOGY

▲

8/3/2019 Cityam 2012-02-21


8/3/2019 Cityam 2012-02-21


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corporate finance.

Obtain the CF de signation via an examination of your

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For more information visit icaew.com/cf.

THE CORPORATE FINANCEQUALIFICATION

MORE NEWS ONLINE

www.cityam.com

MEDIA EXECBRINGS £1M

PERUVIANBID TO SOHOMARTIN MORALES was headhunted by

Apple as one of the four founders of iTunes Europe and sat on the board of

The Walt Disney Company.But Ceviche, the Peruvian restaurant

behind a plain black door at 17 FrithStreet in Soho, is his life’s work.

Since leaving Disney in July 2011, thehalf-Peruvian Morales has survived on fivehours sleep a night and almost bankrupt-ed his family as he pitched the business to300 potential investors to raise the £1mneeded to found the venture.

Morales holds a majority stake; the resthas come from individual minority share-holder friends, with advisory support

from hospitality and media contactsincluding Sinclair Beecham, the Pret A Manger co-founder, Innocent Drinksentrepreneur Richard Reed and Michael

Acton-Smith of Moshi Monsters, who once

Networks has been forced to delay thepower cut it had planned for the St Paul’sthoroughfare tomorrow to carry out“planned works”.

“The area manager is in consultation with the City of London Authority withregards to possible alternatives to give theleast disruption to all involved,” climbeddown the energy distributor, followingthe deluge of outraged letters, emails andphonecalls. “As soon as we have any fur-ther details, we will be in touch.”

More power to Royds Solicitors, City Road Communications and EuropeanGrain & Shipping, who will be conducting

business as usual in the meantime.

DOWNHILL FASTSOMETHING for the City’s skiing fans – thechance to be guided by the greatest down-hill skier of all time, Franz Klammer, on a

four-night trip next winter staying infour- and five-star European resorts,including a traditional Alps evening.

The trip for up to eight people will be auctioned at the Square

Mile Salute at Guildhall on Wednesday.

The fundraising dinnis sold out, but the organiser,Chamberlain’s of London

will be accepting email bids fromthose who can’t attend in person.

These bids should be sent [email protected].

employed Morales as a consultant. Acton-Smith advised the average time

to raise start-up investment is two years, but Ceviche secured its funding withinsix months by last August – “a pretty extraordinary achievement in this cli-mate”, says Morales.

Thirty of Peru’s 420 national dishes will be served under the eye of formerSoho House Group chef Alejandro Bello

when the venue opens on 5 March, andMorales hopes to break even within sixmonths of launch. Turnover, he predicts,

will be “in the ballpark” for that area of Soho – between £20k to £60k per week.

The Capitalist12 CITYA.M. 21 FEBRUARY 2012

EDITED BY

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

AMLIN ON TRACK TOOLS were downed at Lloyd’s of London yesterday as employees stoppedto stare at ex-England rugby captainLawrence Dallaglio and ex-Englandcricket captain Freddie Flintoff, whodropped in as guests of insurer Amlin.

The sportsmen are preparing fortheir epic charity cycle ride: the 2012

Cycle Slam between 23 April and 18May, when the pair will cycle 2,872kmacross Europe from Olympia in Greece,the birthplace of the ancient OlympicGames, to the venue of the London2012 event in Stratford.

Amlin has supplied 22 of its under- writers and brokers to accompany Dallaglio and Flintoff (right) onthe 362-mile final leg, whichincludes the “Hell of the North”,a 153km journey over cobbledfarm tracks from St Quentin toRoubaix.

POWER BATTLEROUND ONE to the City in the

battle of Carter Lane. Afterintense lobbying from unamusedlocal businesses, UK Power

Left: Ceviche founder Martin Morales with headchef Alejandro Bello

Right: Olympic downhillchampion Franz Klammer

8/3/2019 Cityam 2012-02-21


8/3/2019 Cityam 2012-02-21


INVESTORS in Dutch freight anddelivery firm TNT Express are press-ing for a higher offer from US-basedUnited Parcel Services, driving sharesup more than 60 per cent to an all-time high yesterday.

TNT said on Friday it had rejectedan offer from UPS, the world’slargest package delivery company, of €9 per share which valued the com-pany at €4.9bn (£4.09bn), but that both companies were still in talksover a possible deal.

A source close to the talks saidshareholders wanted to sell their

stock and hoped to get between €9.50 and €10 per share for a compa-ny which offers Atlanta-based UPS a bigger presence in Europe.

Some TNT investors had called for

a management change because of poor revenue, profits and share priceperformance.

“Everyone is expecting a higher bid,” SNS fund manager Corne vanZeijl said yesterday, adding that rivalFedEx may enter the fray. He said heexpected UPS would win the prize.

“FedEx can possibly come with anoffer. Ten euros per share is possible.Because FedEx is smaller they canfinance it less easily.”

Van Zeijl said he was holding outfor as much as €11 per share.

Dutch post firm PostNL, which is TNT’s biggest shareholder with a29.9 per cent stake and holds the key to any talks with a buyer, declined to

comment. TNT shares hit an all-time high of

€10.24, up more than 60 per centfrom Friday’s closing price of €6.34. The stock closed at €10.18.

TNT shares jump60pc as sale talks

with UPS heat upBYHARRY BANKS

M&A▲


SILVER SCREEN STAR COULD GO FURTHER INTO RED

Weinstein Co, the film studio behind Bafta boardsweepers The Artist (pictured) and The King’s Speech, is said to be looking to raise $150m (£94.7m) to support operations and pay off debt. The company has struggled financially since its 2005 birth, but is rising tosuccess on a string of Oscar nominations. Union Bank is managing the process.

SHARES in wireless technology firmCSR, which makes chips for use in theBeats headphones loved by PremierLeague footballers, soared yesterday after it pledged a stock buyback of upto $50m (£31.5m), raised its dividendand said it would cut costs quickly.

CSR shares closed up 20.77 per centat 275p last night, making it one of thehighest risers on the FTSE 250 index,despite posting a fourth quarter loss.

Analysts and investors were cheeredas CSR said it had boosted its grossmargin in the fourth quarter as itsfocus on platforms such as audio startsto pay off.

It halted the development of tech-

nology for digital television and silicontuners in December to focus on higher-

margin areas such as its chips. Thesefeature in the Beats by Dr Dre head-phones, which are worn by footballersincluding Arsenal legend Thierry Henry, Everton goalkeeper TimHoward and singer Lady Gaga.

CSR also said it would raise its finaldividend to 7.1 cents per share from6.5 to give a total payout for the year of 10.3, having stacked up $278m in cashor cash equivalents by the end of 2011.

It also said it would deliver $130m of annual cost savings by the end of thesecond quarter.

The changes provided a diversionfrom CSR’s fourth quarter underlyingoperating loss of $4.9m after tax, com-pared to a $12.5m profit a year ago,reflecting restructuring costs and theintegration of Zoran, the imaging tech-

nology group it bought last year.Chief executive Joep van Beurden

said: “Customers are still cautious butthe situation today, against quarterthree and quarter four, is a touch bet-ter... Underlying demand has sta- bilised.”

Revenue for the quarter rose 32 percent to $244m, towards the top of fore-casts, while its gross margin improvedto 51 per cent from 48.7 per cent.

CSR spree is music to

the ears of the CityBY PETER EDWARDS

TECHNOLOGY▲

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ANALYSIS l CSR PLC

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275.0020 Feb

ANALYST VIEWS: ARE THE CHIPS UP OR DOWN FOR CSR? By Peter Edwards

“

NICK JAMES | NUMIS

Fourth quarter results are ahead of expectations with slightly better revenue...We upgrade our target price to 290p from220p... Focus in full year earnings 2012 is onvoice and music, location, automotive,Bluetooth low energy and image capture –areas where CSR has strong platforms and hasalready demonstrated some healthy

revenue trends.

”

“

ALEX JARVIS | PEEL HUNT

CSR is (rightly) capitulating on itscombo roadmap, which means it cannot com-pete long term in key smartphone and tabletmarkets and is cornered into smaller, lowergrowth markets. Although the cheapest of thesemi [conductor] stocks, which may be a goodplace to be through the next phase of invento-ry re-stocking, it is the least attractive

of the peer group.

”

“

IAN ROBERTSON | SEYMOUR PIERCE

Fourth quarter results have come in ahead of our forecasts at the revenues level, at the top end of the guid-ance range and just ahead of consensus... Against our gross margin estimate of 49.5 per cent the company generated amargin of 51 per cent. The year end cash of $278m against our estimate of $254m is particularly encouraging,although the unpaid post acquisition costs of Zoran are likely to have been a significant element of this variance.

”

SOUTH Korea’s Samsung Electronics,the world’s biggest maker of televi-sions, officially marked a shift in itsfocus towards new generation OLEDdisplay technology, and said it willspin off its loss-making LCD flat-screen business into an affiliate.

The announcement comes after weeks of speculation, with the out-look for liquid crystal display televi-sions grim as shoppers in developedmarkets trade in their bulky cathode-ray tube TVs for f lat screens and com-petition intensifies from low-costChinese manufacturers.

Annual global sales of LCD TVs willcontract by eight per cent to $92bn(£58bn) by 2015, research firmDisplaySearch has forecast, while theOLED display market could top $20bn by 2018 – accounting for 16 per centof the total display industry, up from

a current four per cent.Sony agreed to exit its LCD joint

venture with Samsung in December, while Sharp said it would halve LCDoutput at one of its plants.

Samsung shiftsto new TV techon LCD spin-off TECHNOLOGY

▲

8/3/2019 Cityam 2012-02-21


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SHARES in sports retailer JJBsoared by 15 per cent yesterday asinvestors reacted well to improvedmargins at the group, despite afall in sales.

JJB, which is attempting to turnaround its fortunes having beenclose to collapse last year, saidthat group like-for-like sales forthe five weeks to 29 January hadfallen 5.7 per cent, contributingto a 7.6 per cent drop in like-for-like sales in the company’s fiscalsecond half.

But signs of improvement com-pared to the first half – whensales fell 17.9 per cent – and a 32.1per cent uplift in margins seem to

have appeased investors, who willnow be looking to the summer’smajor sporting events as a cata-lyst for further progress.

“Since our Christmas tradingupdate our like-for-like cash mar-gins have continued to improveand our full year trading perform-ance is broadly in line with ourexpectations,” said chief executiveKeith Jones, who was brought induring 2010 to lead the company out of trouble.

“We are continuing to imple-ment our turnaround aware of the importance of the key tradingopportunities afforded by theEuropean football championshipsand London Olympics,” he added.

Panmure Gordon analyst PhilipDorgan said the group was “per-

forming well on a cash profit basis”.

Last week rival Sports Directdelivered a much more upbeattrading statement, with totalsales up nine per cent in for thequarter ended 2 January. It alsosaid it plans to reintroduce its div-idend after a two-year hiatus.

Margin boost sendsJJB shares soaringBY ELIZABETH FOURNIER

RETAIL▲

TESCO, the world’s third-largestretailer, launched the initial publicoffering of its Thailand property fund yesterday, aiming to raise upto £369m to finance future expan-sion.

The offering is part of a trendamong retailers in recent years tosqueeze more value from their realestate assets, bundling them into aproperty fund, selling the fund toinvestors and leasing back the prop-

erty. The Tesco Lotus Retail Growth

Freehold and Leasehold Property Fund, as it is formally called, com-prises 17 shopping malls anchored

by a Tesco Lotus hypermarket incities including Bangkok andtourist destinations such as Krabi.

The fund “is well positioned tocapitalise on the steady growth of the Thai economy, the strength of the retail sector and increasing

wealth and consumption across thecountry,” Tesco Lotus chief execu-tive Chris Bush said in a statement.

The property fund, similar to a

real estate investment trust, orREIT, will offer shares at a price

range of 9.65-10.40 baht (20p-21p)each, valuing the total deal at up to18bn baht (£369.1m), Tesco’s Ek-Chai Distribution System unit saidin a statement. At that price, thefund would have a yield of 6.5 toseven per cent per year.

That yield would compare with8.14 per cent for both the CPNRetail Growth Leasehold Property Fund, which owns three malls andan office tower, and movie theaterowner Major Cineplex LifestyleLeasehold Property Fund, accord-

ing to figures from the Asia PacificReal Estate Association.

Tesco launches float of its Thailandproperty fund to raise up to £369mPROPERTY▲

BRITISH landlord Segro said yester-day it has sold a portfolio of fivenon-core industrial estates to fundsowned by Ignis Asset Managementfor £80.2m.

The sale is part of the company’splan to focus its UK multi-let indus-trial portfolio on London andSouth East.

“The sale of these assets demon-strates that, despite the uncertaineconomic environment, investordemand for industrial assetsremains resilient,” Phil Redding,Segro’s chief investment officer,

said in a statement. The sold portfolio -- with estates

located in Fareham, Southampton,Bristol, Crawley and Portsmouth --has total lettable space of 74,734

square metres, said Segro.UK Commercial Property Trust,

one of Ignis’ funds that is buyingthe properties from Segro, said itcontinues to look for acquisitionsto boost its industrial portfolio.

“This transaction fits well withour strategy of acquiring goodquality assets that, particularly inthese uncertain economic times,

both complement our existingportfolio and offer strong, defen-sive income characteristics,” saidUKCPT chairman Christopher Hill.

Segro, whose portfolio comprises£5.4bn of predominantly industrialand warehouse assets, will releaseits full-year results this morning.

The company last updated themarket in November, when it saidits vacancy rate had dropped to10.2 per cent from 11.4 per cent in

June.

Segro banks £80mthrough selling off

industrial estatesBYHARRY BANKS

PROPERTY▲

JONES Lang LaSalle’s industrial andlogistics team has been advising Segroon its £1.6bn disposal programme,

including yesterday’s sale, with PhilipMarsden leading the team. Marsden,director of capital markets, is regardedas one of the UK’s top investment advis-

ers and in October was also handed asecond role as managing director of JLLS’s Europe, Middle East and Asiacorporate finance team. A former part-ner at King Sturge, which merged withJLLS in May, Marsden has beeninvolved in the creation of several sig-nificant funds and investment vehiclesfor a variety of clients in recent years,including Scottish Widows, Aviva andLegal & General. JLLS’s industrial team

transacted more than 26m square feetof space across the UK last year andalso completed the largest number of leasing deals of all industrial agents.

PHILIP MARSDEN

JONES LANG

LASALLE

Segro boss David Sleath has sold £80m of property assets

MEET THE ADVISERS

DANISH brewer Carlsberg yesterday warned its operating profits will beflat in 2012, hit by declining beermarkets in northern and westernEuropea while its biggest market,Russia, will show a slow recovery.

The world’s fourth largest brewersaid yesterday it expects the Russian

beer market to return to modestgrowth this year after a three per centfall in 2011 in the wake of big taxhikes, high inflation and regulations.

The group, which brews Baltika, Tuborg as well as Carlsberg beers,makes nearly a third of its sales inRussia with a market share of close to40 per cent, and expects the world’sfourth biggest beer market to startrecovering in 2012.

The group said fourth quarter oper-ating profit rose to 1.83bn Danishcrowns (£205.6m) from 1.13bn a year

earlier, but added 2012 underlyingoperating profits will be flat.

Group sales rose to 14.85bn crownsin the fourth quarter from 13.4bn a

year earlier.

Fizz to fall outof Carlsbergprofits in 2012

CONSUMER▲

ANALYSIS l JJB Sports PLC

p


12.50

12.00

11.50

11.00

10.50

11.5020 Feb

8/3/2019 Cityam 2012-02-21


DIVESTMENTS will rise to a value of £250bn throughout the world in2012, Deloitte predicted yesterday, ascompanies spin off non core assets to bolster their balance sheets.

The total value of the spin-offs would represent a staggering 92 percent rise from last year, when thetotal came to £130bn.

“Investor appetite for spin-offs isgrowing, often because major auster-ity measures have an adverse effecton companies’ plans for growth,”commented Ryan Mendy of invest-ment adviser The Spinoff Report, which co-wrote the study.

Boards are being pressured by increasingly vocal shareholders,Mendy added, as investors demand“greater transparency and share-holder value”.

“Unless heavily incentivised, bothinstitutional and private investorsare more and more unwilling to aidtraditional-style corporate restruc-turings [such as IPOs] on yet to beproven strategies,” he said.

“This is evidenced by the flurry of increased corporate spin-off activity in key sectors such as basic materials

and consumer good sectors.”Companies in Europe have rapidly

spun off arms so far this year, with£10.5bn in divestments already.

And a further £131bn in spin-offsfrom corporations in Europe wait inthe pipeline, the research claims.

In terms of sectors, nearly a quar-ter of divestments this year will bemade by basic materials firms, deal-ing with metals, mining, mineralsand resources, Deloitte said.

“This sector is active due to thecyclicality of fully valued businesses within the sector and the currenthigh price of commodities,” it said.

And over a fifth, or 22 per cent, of activity will come in the consumergoods and services sector, accordingto the analysis of the pipeline.

“The current macro Europeansqueeze on the retail and service sec-tors is pressuring companies to break-up some divisions, as manage-ment works to deliver shareholders’long-term goals,” the report said.

“Companies are increasingly assessing their businesses and com-ing to the conclusion that with a lit-tle help from the parent entity,individual divisions can performmuch more efficiently as standaloneentities.”

THE GOVERNMENT is to pay compa-nies and charities to improveprospects for young unemployed peo-ple, deputy PM Nick Clegg willannounce today.

Firms will be able to bid for con-tracts worth up to £2,200 for every young person that they provide withskills for the jobs market.

The £126m of state funds will be tar-geted at 55,000 specific “Neets” – 16

and 17 year olds not in education,employment or training.

The “high risk” group consists of teenagers with no GCSEs at grade C orabove. Firms will be paid extra funds if the youths subsequently stick withtraining programmes or hold down jobs. “Sitting at home with nothing todo when you’re so young can knock the stuffing out of you for years,” Clegg will state today.

“It is a tragedy for the young people

involved –a ticking time bomb for theeconomy and our society as a whole.”

Getting inactive teenagers back onto their feet is a task the govern-ment “cannot do alone” Clegg argues.

“That’s why today I am calling oncharities and other organisations atthe coal face to work with governmentto help tens and thousands of lostteenagers onto a brighter path,” he will say.

Over one million young people areunemployed in the UK according toofficial statistics, although students

seeking work are included in the fig-ures.

Government to pay firms and charitiesto get jobless teenagers back on track

THAILAND’s economy crashed in thefinal quarter of last year, with freshdata revealing a contraction of 10.7per cent compared to the previousthree months.

Devastating floods caused theeconomy to plummet by more than“in either the 2008-09 global crisis orthe Asian financial crisis of the late-1990s”, Capital Economics said yester-

day.Capital expects a further cut in

interest rates, by 0.25 per cent, asauthorities aim to help the economy bounce back.

“We still forecast that Thailand’seconomy will expand by 4.5 per centthis year,” economists added.

The final quarter figure showed anine per cent dip in GDP compared toa year earlier. In the three months toSeptember, by contrast, the economy had expanded by 3.7 per cent.

For the whole year, growth aver-

aged just 0.1 per cent, after being hit by the floods.

Thailand GDP decimatedby 2011’s heavy flooding

ASIAN ECONOMY▲

THE ECONOMIC squeeze on house-holds caused nearly half of UK adultsto reduce or cut their savings overthe past year, new research claims.

A survey from the Money Supermarket website showed thatthe main reason for reducing savingactivity was to fund everyday life.

Of those who have reduced sav-ings, 18 per cent cited the need topay off debts such as personal loansor credit cards.

The tough economic situation hasalso meant that the public’s spend-

ing habits are changing, the reportargued. The majority of respondents said

they have cut down on eating out, buying new clothes and going onholidays.

One sixth of Britons have stoppedsaving altogether, the survey found.

The east Midlands and the north west were the top regions wheremost people had stopped or reducedtheir savings.

Half of the UK either cutor quit saving last year

UK ECONOMY▲

Divestments

to soar 92pc,says DeloitteBY JULIAN HARRIS

M&A▲

BY JULIAN HARRIS

EMPLOYMENT▲


“I’m not too worried yet. There are lots of otherpressing issues in the financial world that needto be resolved as soon as possible – forexample the Eurozone crisis.”

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“To be honest I haven’t thought about it verymuch. Obviously it’s a concern as I’ve readabout it and seen it on the news, but thequestion is how much of what we hear

is the truth?”

“At the moment I am not particularly worried. The diplomats will get involved and will sort something out. I don’tthink they will let it escalate to anything dangerous.”

JAPAN logged a record trade deficit with China in January as exportsdropped by a fifth, underscoring con-cerns about how sharply China isslowing and its ability to buffer a frailglobal economy against Europeanturmoil.

The 20.1 per cent annual slump inexports to China, Japan’s main exportmarket, condemned Tokyo to a recordmonthly trade deficit, stark evidence

of the pain from a firm yen, the globalslowdown and fuel imports to makeup for idled nuclear plants.

Japan’s shortfall with China was587.9bn yen (£4.6bn), 40 per cent of thetotal trade deficit for January, Japanese finance ministry datashowed.

While the drop in exports was exac-erbated by an early Lunar New Yearholiday hitting shipments of steel andother manufacturing inputs, it wasstill the fourth straight month the Japanese exports to China have fallen

in annual terms.“Chinese authorities may already be

worrying about weakening demand,”said Mari Iwashita, chief market econ-omist at SMBC Nikko Securities, point-ing to Saturday’s policy easing with a50 basis point cut in banks’ reserverequirement ratio, the amount of cash banks must hold in reserves.

The Chinese Lunar New Year holi-day, which fell in late January this year but in early February last year, pusheddown what was already decliningdemand in China.

Concerns over Chinese slowdown afterimports from Japan slump by a fifth

BYHARRY BANKS

ASIAN ECONOMY▲

The Chinese Lunar New Year fell earlier in 2012, widening nearby Japan’s trade deficit in January Picture: GETTY

CITY VIEWS: HOW WORRIED ARE YOU ABOUT THE IRANIAN NUCLEARTHREAT? Interviews by Phoebe Torrance

8/3/2019 Cityam 2012-02-21


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MINER Rio Tinto yesterday unveiled a$518m (£327m) plan to pioneer the useof driverless trains in Australia in a bidto ramp up its production.

The company, which already has driverless trucks, plans to run fully auto-mated trains across its 1,500 km (930mile) iron-ore rail network in north

west Australia from 2014, to help boostoutput 60 per cent by 2015.

The re-fitted trains will be operatedlike a space mission from a control

room in Perth, 1,500 km away, from where Rio now runs the driverlesstrucks.

“This is not just about job losses. That’s not what this is about. This isabout us remaining competitive,” saidGreg Lilleyman, president of Rio

Tinto’s Pilbara operations.Rio says it wants to avoid forcing

workers to toil beneath the scorchingheat of the Pilbara, a desert region thatranks among the world’s richest ironore precincts, but automation alsoenables it to overcome a shortage of skilled labour.

The shortage has been fuelled by arecord boom in mining and energy investment, with $230bn worth of projects underway or approved in

Australia.Salaries have skyrocketed to the

point where a truck driver can earnmore than $100,000 a year.

At least half of Rio Tinto’s 500 traindrivers may lose their current jobs,

with the rest to be used on about one-fifth of the network that will still needdrivers.

Rio said no one will be laid off as itaims to retrain workers for new roles.

Rio has long dreamed of automat-ing its trains, but put the plan on holdduring the financial crisis in 2008

when it struggled with a massive debt burden from its takeover of Alcan.

Other miners, including BHP, are

watching how Rio’s experiment pansout and have yet to follow suit.

Rio says it is still expanding its over-all Pilbara workforce and will needthousands of new workers, on top of the 10,500 it already employs, to boostiron ore production to 353m tonnes a

year by 2015.

Rio Tinto aimsfor driverlesstrains growthBYHARRY BANKS

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BRITISH construction group Kierhas won a £100m contract fromFrance’s EDF to prepare theground for construction of a new nuclear power station in the westof England.

Kier said in a statement that thecontract to carry out site works forthe Hinkley Point C nuclear power

station, which is due to provide sixper cent of Britain’s energy needs, would create 350 jobs.

Kier’s announcement confirmsa deal was first announced as part

of Prime Minister DavidCameron’s meeting with FrenchPresident Nicolas Sarkozy last

week.Under deals

unveiled by the lead-ers, EDF, Areva andRolls-Royce will co-operate in developingnew nuclear powerplants in Britain.

The contract will

include buildingthe required infra-structure andlandscaping thearea in prepara-

tion for the work on the plant tostart.

EDF is taking the lead in build-ing Britain’s next generation of nuclear reactors after buyingBritish Energy in a £12.4bn dealthree years ago.

Kier Group chief executive PaulSheffield (pictured right) saidafter yesterday’s announcement:

“We have an excellent track record in the nuclear

industry and enjoy along-standing relation-ship built over many years of working togeth-er in joint venture.”

BYHARRY BANKS

CONSTRUCTION▲

ANALYSIS l Rio Tinto PLC

p


3,800

3,750

3,700

3,650

3,600

3,706.0020 Feb

Roche getsnod for skincancer drug

PHARMACEUTICALS giant Roche said yesterday that the European Unionhad approved Zelboraf, which repre-sents a new treatment option forpatients with the deadliest form of skin cancer.

The go-ahead, expected binvestors after Roche flagged it asrecently as December, follows one inthe United States last August.

The new drug is given as a twice-daily pill and is designed to be usedalongside a companion diagnostictest, also from Roche, that identifies

which patients have a specific genet-ic mutation that means they will

benefit from the treatment. The gene sequencing technology,

which Roche is targeting with a bidfor San Diego-based Illumina, is cen-tral to medicine’s future as it allowsresearchers to better predict how patients will respond to a drug.

Coupled with strong study resultsfrom experimental breast cancertreatment pertuzumab, Zelboraf underscores Roche’s commitment totargeted medicines.

Roche said: “Approval is importantas Zelboraf significantly improvespatient survival and exemplifies the

benefits that Roche’s personalisedapproach to medicine can provide forpatients, physicians and society.”

As well as the USA and the EU,Zelboraf has also recently beenapproved in Switzerland, Brazil,Israel, Canada and New Zealand.

Australia is considering approval.

BYHARRY BANKS

PHARMACEUTICALS▲

NEWS | IN BRIEF

International Ferro loses lessSouth Africa’s International FerroMetals yesterday said it had narrowedits losses in the final six months of 2011.The net loss after taxation dropped fromZar107,000 (£8,700) in 2010 toZar92,000. But the Aim-listed companyreported production of ferrochromedown 15 per cent over the period. Chief executive Chris Jordaan said: “The com-bination of solid operations, active mar-keting to a broader range of customers

and cost savings should place IFL in ahealthy position to take full advantage of

the robust long-term outlook for stain-less steel.”

Workers occupy Arcelor plantWorkers at an idled ArcelorMittal steelplant in north east France occupied thesite yesterday, seeking to put theirplight on the political map ahead of apresidential election where industrialdecline is a central theme. Some 200workers invaded management officesat the factory in Florange, in the

Moselle region close to Belgium andGermany, after ArcelorMittal

announced last week it was prolongingthe temporary shutdown of its twoblast furnaces.

Alibaba Group takes $3bn loanChinese e-commerce firm AlibabaGroup was yesterday set to sign a$3bn (£1.9bn) loan it plans to use totake private its Hong Kong-listed unit,Alibaba.com. Alibaba Group, which is40 per cent-owned by Yahoo, is look-ing to take Alibaba.com private in a bid

to strengthen founder Jack Ma’s con-trol of his e-commerce empire.


AVIATION chiefs in India yesterday summoned executives from strug-gling airline Kingfisher to explain astring of flight cancellations.

The directorate general of civil avia-tion wants answers after 32 out of the240 flights that Kingfisher operateseach day were cancelled over the

weekend.Loss-making Kingfisher has been

denied financial assistance from theIndian government and in a state-ment warned that further cancella-

tions were likely.Civil aviation minister Ajit Singh

said: “It is a very serious matter, werecognise it and DGCA has calledKingfisher to find out what’s goingon.”

Kingfisher has so far failed inefforts to get fresh equity capital.Banks own about a quarter of itsshares after the company’s debt wasrestructured early last year.

The airline is also embroiled in anfight with the government over taxes.

Kingfisher lost 4.4bn rupees(£656.7m) in the quarter that endedin December.

Kingfisher summoned to

explain scrapped flights

Kingfisher has been struggling to secure new funding Picture: GETTY

BY JOHN DUNNE

AVIATION▲

Kier wins £100m contract for EDFnuclear power plant groundwork

8/3/2019 Cityam 2012-02-21


Atlas GeneticsNeil Butler has been appointed as chair-man of Atlas Genetics. Butler, who

joined the board in November, is the for-

mer chief executive of Vivacta and theformer business development director of Quester Capital. Between 1999 and2004, he was CEO of Oxford Biosensors;

prior to that, he was VP, performancefilms at Rexam.

Idex RecruitmentIdex, which specialises in general insur-ance and financial services recruitment,has hired David Carr as a managing

partner. Carr formerly worked at Hays,where he was the UK director responsi-ble for the insurance business.

Unitech Corporate ParksAubrey Adams will step down as chair-man of Unitech Corporate Parks, theAim-listed commercial real estate com-pany focused on India, on 1 March.Adams, who was recently appointed asglobal head of property in the global

restructuring group of RBS, will remainon the board of UCP as a non-executivedirector, and as a non-executive direc-tor of British Land. He will be replacedas chairman by Donald Lake, who hasbeen a non-executive director of UCPsince the company’s IPO in 2006.

PermiraThe private equity firm has appointedMubasher Sheikh as head of its health-care team. Prior to joining Permira,Mubasher was a partner at McKinsey& Co, where he led the global pharma-ceutical research and developmentpractice. In this role, Sheikh also ranMcKinsey’s European healthcare pri-vate equity and principal investing

industry.

SavillsDavid Poole has been appointed to leadSavills’ valuation team in France, basedat the firm’s Paris office. Poole startedhis real estate career at DTZ’s UK busi-

ness, before relocating to the company’sParis valuation team, where he becamedirector of DTZ Eurexi in 2006.

Move With UsThe residential property specialist hasappointed Anthony Radford as prod-uct development director. Radford

joins from GE Capital and previouslyworked at Halifax, Bank of Scotlandand Legal & General.

CITY MOVES | WHO’S SWITCHING JOBS Edited by Harriet Dennys

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in association with

European marketsrise on Greek talks

EUROPEAN shares closed at anear seven-month high yester-day as Eurozone finance minis-ters edged closer to a

long-awaited agreement on a rescuepackage for Greece.

The pan-European FTSEurofirst300 index of top shares rose 0.7 percent to 1,090.95 points. Volume waslow, at 69.5 per cent of the 90-day average, with Wall Street closed for aholiday.

“We have had quite a good run year-to-date and a lot of it is premisedon Greece getting its bailout. Theremay be another day of euphoria butthen we will get back to normal andcould sell off a bit,” said MichaelMcNaught-Davis, head of internation-al equities at Scottish Widows.

Eurozone finance ministersinched towards approving a second

bailout for debt-laden Greece that will resolve the Greek government’simmediate repayment needs.

Stocks rose almost across the board. Banks, many of which havesignificant exposure to Greece andother peripheral Eurozone countries

and have taken a hit on their balancesheets,were among the biggest gain-

ers.Eurozone banking stocks rose two

per cent, and are now up 18 per centin 2012. As well as more confidencethat the Eurozone debt crisis is beingcontained, the sector has gainedfrom the European Central Bank’slong-term refinancing operation, pro-

viding cheap funding.“While there remains broad scep-

ticism that this bailout will effective-ly draw a line under the longrunning Greek debt saga, it wouldappear that markets believe that for

now, an imminent messy default sce-nario could well be averted,” saidMichael Hewson, senior market ana-lyst at CMC Markets.

Mining stocks gained after topmetals user China cut the amount

banks must hold in reserve, whichshould allow more lending to boostits economy. China’s central bank effectively made available an estimat-ed $55.6-$63.5bn extra cash for lend-ing, which could boost demand formetals.

The STOXX Europe 600 BasicResources Index rose 1.6 per cent, tak-ing its gain in 2012 to 16 per cent.

McNaught-Davis said he was stick-ing with more defensive sectors suchas healthcare, consumer discre-tionary and consumer staples,adding he had “warmed up a bittowards cyclicals” and was lessunderweight on industrials than he

had been, including buying Germancarmaker BMW.

ASURPRISE easing in China’smonetary policy drove Britain’sFTSE 100 within striking dis-tance of a seven and a half

month closing high as miners ralliedon the prospect of revived demandfrom the world’s most voracious con-

sumer of raw materials.Miners were the top gainers asLondon’s blue chip index climbed40.18 points, or 0.7 per cent, to end on5,945.25 yesterday.

China said at the weekend it wascutting the amount of cash banksmust hold in their reserves in anothermove to try to kickstart slowinggrowth.

“China’s reserve requirement ratiocut was a surprise to the market butsupports our economists' belief thatthe authorities are more concernedabout growth than inflation,” Nomurasaid in a note.

Societe Generale said: “The cut willrelease around Chinese YuanRenminbi 400bn into the banking sys-tem and will help ease banks’ liquidity situation, placing downward pressureon interbank interest rates.”

It added that it was expecting three

more cuts in the reserve requirementratio – by a total of 150 basis points –

by the end of the year.Investors positioned themselves not

only for a near-term boost in metaldemand but also for a rate cut soon.

“We typically see a knee jerk bullishmove in the miners as a result of any Chinese easing and today's reactionhas been no different,” a London-basedtrader said.

Insurers and banks, sectors with thelargest exposure to Europe’s sovereigndebt crisis, also pushed ahead in antic-ipation of a deal being struck to rescueGreece for a second time.

Although doubts remain over theability of Greece to carry through theagreed austerity program, Eurozonefinance ministers are expected toapprove a second bailout for Greece

yesterday to try to draw a line undermonths of uncertainty that has shak-en the currency bloc.

Henk Potts, equity strategist atBarclays Wealth, described easing con-cerns over Greece, supportive US eco-nomic data and the readiness of policymakers in emerging markets toact to maintain robust growth levels as“a powerful mix of positivity”.

“Investors can once again focus onthe fundamentals, which are very good corporate positions with unde-manding valuations.”

Those valuations have driven a spikein M&A activity recently, with Misysup 6.6 per cent after Vista Equity Partners outlined an all-cash deal for

Misys that would scupper an agreedmerger between the British banking

software group and Swiss Temenos.Weir Group, which is in a bidding

war for Australian mining equipmentfirm Ludowici with Danish engineer-ing company FLSmidth, climbed 6.6per cent ahead of results next week.

Short interest in Weir’s sharesspiked significantly since August toabout 35 per cent of stock available forloan, compared with around an aver-age of nine per cent for the capitalgoods sector, according Dataexplorers,leaving investors scrambling to coverpositions as the share price gains

upward momentum ahead of results.“Weir has just underperformed thesector by 18 per cent, and yet theunderlying growth dynamics remainunchanged,” BofA Merrill Lynch saidin a note.

Perceived defensive stocks filled theFTSE fallers list, with drugmaker Shiredown 1.1 per cent, Imperial Tobacco0.8 percent lower and utility SevernTrent off 0.7 per cent as investorsturned to riskier assets.

China’s monetary easing putsFTSE close to the 6,000 levelTHELONDONREPORT

THEEUROPEANREPORT

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

ANALYSIS l Ladbrokes

140

130

135

145

150

155

125

Dec Jan Feb

p

154.5020 Feb

LADBROKESUBS rates the betting group “buy” and has lifted its target price by 5p to175p. The firm’s full year results were above forecasts, with strong growth inUK retail, which the broker says will continue this year thanks to double-digitgrowth at betting machines and a boost from Euro 2012. UBS expects to seeLadbrokes in an even stronger position next year once a switch to digitaloperations is complete, though the upgrade will dampen margins this year.

ANALYSIS l Anglo American

2,800

2,400

2,600

3,000

2,200

Dec Jan Feb

p 2,690.0020 Feb

ANGLO AMERICANCiti has a “neutral” rating on the miner and a target price of £30. Thebroker has trimmed its earnings forecasts by three per cent in the wakeof Anglo’s 2011 results, in light of rising copper and metallurgical coalcosts, and could cut further given the strength of the South African rand.Citi also notes that the firm’s dividend is uncompetitive in the commodi-ties sector, with yields of just 1.8 per cent last year.

ANALYSIS l Capita

640

620

630

650

660

670

610

Dec Jan Feb

p 656.5020 Feb

CAPITAJP Morgan rates the outsourcing group “overweight” and has a target priceof 860p. The broker hopes to see a more upbeat outlook when the firmreports full year results tomorrow. JP Morgan thinks Capita’s revenue falls inthe wake of the 2010 election and government spending cuts should start tolevel off soon. It notes that the firm has won £1.3bn worth of contracts inthe first 10 months of 2011 – more than double the previous year’s haul.

Royal Bank of ScotlandRBS has appointed Stuart Dean as head of healthcare in the corporate and institutionalbanking (CIB) team. Dean has worked at RBSfor more than 11 years in the bank’s structuredfinance division in the south of England and

London. Before joining RBS, he spent twoyears at the John Lewis Partnership, which he joined from KPMG. In his new role, Dean willlead a team of healthcare finance specialistsand provide sector support to RBS CIB’sregional network across the UK.


p

21 Nov 9 Dec 3 Jan 10 Feb23 Jan

6,000

5,200

5,000

5,400

5,600

5,800

ANALYSIS l FTSE 5,945.2520 Feb

8/3/2019 Cityam 2012-02-21


20 The ForumCITYA.M. 21 FEBRUARY 2012

cityam.com/forum

ANY changes to the NHS are always going to pro- voke controversy. But in a healthcare landscapecharacterised by changing health needs, rapidtechnological innovation and rising patientexpectations, reform is vital if the NHS is to meetthe challenges of the coming decades.

That is one of the reasons that these proposalsare following in the footsteps of reforms put for-

ward by every health secretary since Ken Clarke, with the sole exception of Frank Dobson. Eachreform has been opposed with the same zeal by most of the opponents of the government’s Bill.

The British Medical Association (BMA), forexample, has opposed most pieces of healthreform since the war, including the formation of the NHS. It seems perverse that the BMA hasmade such a stink about non-attendance at ameeting about the implementation of a reformthey oppose. It’s a little like a Manchester Unitedfan complaining about non-invitation to a meet-ing about the future of Manchester City.

There’s good policy sense behind the devolv-ing of power from managers in Primary Care

Trusts to local GP consortia. In essence, thereforms involve transferring power from man-agers to doctors and nurses. Giving GPs morepower over commissioning empowers clinicians,

who understand patient needs and health needsand are in direct contact with patients, ratherthan relying on remote bureaucrats.

Moving commissioning power to the frontline, putting the power in the hands of thehealth professionals who see patients regularly can only strengthen the NHS, with changes tocommissioning helping to put the patient at theheart of the process. It will also help to align clin-ical decisions and their financial consequences.

That decisions about local healthcare should be made by local doctors, rather than adminis-trators, in no way resembles the revolutionary

change that many warn about. In many ways, itis a continuation of the Tony Blair/Alan Milburnreforms. There’s compelling evidence fromthose experiments with practice based commis-sioning that GP commissioning can deliver bet-ter quality care for patients, while avoidingunnecessary and expensive hospital admissions.

Opponents of reform also object to competi-tion and contestability. That is dogma over-riding

both experience and practical necessity. The private sector and the third sector clearly have animportant role to play in delivering innovativeand cost effective services to the NHS.Competition and contestability will increase thechoice available to patients and to commission-ers and enhance the service provided to patients.

Surely readers of City A.M. do not need to bepersuaded that competition and contestability,rather than monopoly provision, is a good thingthat will improve patient outcomes. In opposingthe role of private and third sector providersplaying a role in the NHS, opponents of healthreforms are opposing the policies of the last gov-ernment as much as they are opposing the poli-cies of this government.

The NHS cannot be preserved in aspic if it is tomeet the needs of 2012, which are very differentto the needs of 1948. People are living for longer,the cost of care is rising and patients also havehigher expectations than ever before.

NHS reforms are necessary to ensure that itcontinues to prosper in a fast-changing environ-ment. Vested interests should not be able to

wield a veto. Just as the NHS evolved in the past,it needs to continue to evolve so it can continueto deliver first class services that put the patientat the heart of the process.

David Skelton is deputy director of the independent think tank Policy Exchange. You can follow him onTwitter @djskelton

Is the NHS reform bill a cure

for Britain’s healthcare ills?

DAVID SKELTON

YES

WHEN talking politics, I’m always reluctant touse medical analogies; it can seem rather pre-dictable from someone who works for an organ-isation like the Royal College of Nursing (RCN).However, when talking about the government’sHealth and Social Care Bill, the dramatic blue-print to reform the NHS, the analogies seemmore apt. Put simply, the Prime Minister’s diag-nosis is correct but the treatment is very wrongindeed.

The government is right when it says that theNHS needs to change. Of course it does. Ourpopulation is growing, it’s getting older andmore of us than ever before are living withmedical conditions that last decades. The way

we look after patients now, with a focus on hos-pital care, just won’t work. We’ll need to movecare into our communities and, in some cases,our homes. The NHS does need change. It needsto evolve with the times. But it does not needthis bill.

Only last month, the RCN – which represents420,000 nursing staff in the UK – moved tooppose the bill and we’re now calling for it to be

withdrawn. Why? Because not only does it failto fix the problems posed by our changinghealth needs, but it also stands to do real dam-age to our healthcare system and the patientsthat use it.

Take the role of competition, which the gov-ernment wants to increase dramatically in the“new NHS”. The RCN does not oppose competi-tion in principle; competition has been part of the NHS since it was founded in 1948. The prob-lem lies with just how much competition thegovernment wants to inject into the NHS. Themore that services are told to compete witheach other, the less joined-up a patient’s experi-ence will be. The newly-diagnosed cancerpatient doesn’t want health providers that com-

pete with one another, but services that cooper-ate and share information.

The bill also spells out changes to the privatepatient income cap, which is the limit to thenumber of private patients that any organisa-tion can treat. The government wants to raisethe cap to 49 per cent, considerably higher thanit is now. Whilst this may seem like a technicalchange, the effect on patients could be very realindeed. If NHS organisations shift their focusaway from delivering good care and finding sav-ings that don’t impact on the frontline, andinstead concentrate on how to cater for the pri-

vate patient market, NHS patients may suffer. The RCN has sought to engage with the bill at

every stage. We’ve consulted with our members, we’ve outlined our main concerns, we’vegiven evidence to parliamentary committeesand we’ve even hosted “listening exercises”

with Andrew Lansley. It was after a year of working constructively with the government,and not seeing the changes that we were askingfor, that we felt we had to move to oppose this

bill. Put simply, the turmoil of continuing withthis bill is now much greater than the turmoilof stopping it. The government may have dis-missed our concerns as “vested interests”, butour only vested interest is making sure that theNHS delivers for patients everywhere.

This bill is contentious for a reason. When alist of opposing organisations includes the RCN,the British Medical Association, the RoyalCollege of General Practitioners, and many oth-ers, you have to question whether you’re doingthe right thing. We want the NHS to evolve, weunderstand the need for change, but this bill isthe wrong way of doing it and doctors, nursesand, most importantly, patients will suffer.

Dr Peter Carter is the chief executive and general secretary of the Royal College of Nursing.

DR PETER CARTER

NO

Twitter: @cityamforumon the web :cityam.com/forum

or by email: [email protected]. Top responses will be reprinted in The Forum.

Agree? Disagree? Got a sharp comment?The Forum wants you to join the debate.

COMMENT NOW ON

8/3/2019 Cityam 2012-02-21


8/3/2019 Cityam 2012-02-21


Despite every possible effort by the shorts, euro-dollar refusesto go down. Over the past four weeks the pair has traded in a

narrow $1.3000-$1.3300 range,rebounding every time it has

broached the key $1.3000 level. Onereason for this remarkable resilienceis the persistent skew in positioning. After a few weeks of reducing in size,euro shorts have piled back into thetrade and, according to the latestcommitments of trade data from theUS Commodities Futures TradingCommission, have increased their bets from -140.6K the previous week to -148.6K. Although this short posi-tion remains below recent recordhighs, it is nevertheless massive andcreates a combustible environment,ripe for a short covering rally, whileconcurrently making any furtherdeclines in the pair much more prob-lematic.

Speculative markets, by their very nature, cannot allow the majority of participants to be right on the trade.Large skews in positioning to one sideor the other often presage violentmoves in the opposite direction. That’s why some market analysts are beginning to believe that the near-term risks in euro-dollar may lie tothe upside, especially if the pair can break above the $1.3320 mark. This would force many of the long-termshorts to reconsider their view andfuel another round of short covering.

The euro negatives are well-known.Greece remains a basket case and few serious analysts believe that it canrestructure effectively without even-tually defaulting on its obligations,even if it receives a bailout. Yetthough Greece remains the primary focus of the market, its economicimportance to the Eurozone is minus-cule – its GDP comprises less than 2per cent of all Eurozone economicactivity. If Greece finally receives itssecond bailout the country’s econom-

ic problems will not be solved, but itmay pacify investors for the time being and shift the focus elsewhere.

Meanwhile support for the eurohas come from an unexpected place –China. Last week PBOC chief Zhou

Xiaochuan pledged that the country’scentral bank will increase its holdingsof euro-denominated assets. Zhounoted that China has been a consis-tent buyer of euro assets and will fur-ther increase its holdings, most likely through Europe’s bailout fund. Headded that the euro can become a bigger and more important reservecurrency.

Zhou’s comments reaffirmedChina’s long-standing policy of sup-port for the euro-dollar, which it con-siders to be vital to the country’spolitical and economic goals. As wehave noted many times in the past,the Chinese are loath to see a unipo-lar world in which the dollar standsas the only reserve currency. They willlikely do everything within theirpower to support the euro as a viablealternative to the greenback.

The Chinese are also providing sup-port for euro-dollar by looseningmonetary policy once again. This past weekend the PBOC has cut the reserverequirement rate by 50 basis points,signalling an easing of credit condi-tions for the Chinese banking sector.

Assuming the Greek bailout dealdoes not hit any further snags, thetrue test of euro strength will comethis Wednesday when the marketgets a glimpse of the latest Eurozoneflash PMI readings for February. These will provide the most up-to-datereadings of economic conditions inthe region. The market anticipates a very slight improvement from theprevious month. But if the data sur-prises to the upside it could providethe upside catalyst to push the pairthrough the $1.3320 resistance leveland fuel a much more substantialshort covering rally.

DIRECTOR OF CURRENCY RESEARCH, GFT

BORIS SCHLOSSBERG

NEAR-TERM EURO-DOLLARRISKS MAY LIE TO UPSIDE

facebook.com/fx360 twitter.com/fx360

fx360.com

The contents of this column are provided for general information purposes only. One should consider the appropriatenessof the information in light of their own objectives, financial situation or needs before trading. CD11UK.074.010612

$ Although it’s been mired in $1.3000-$1.3300range, a break above $1.3320 could signal amore substantial rally in euro-dollar

$1.33655

$1.30000

2011 21 15 28th 23 16Dec Feb2012

1.38

1.30

1.28

1.32

1.34

1.36

ANALYSIS l Euro-dollar

Oil’s recent surge

may sink in sandsAssumptions that the only way is up for black gold reston an excessively crude analysis, writes Philip Salter

RESULTS last week fromIntercontinental Hotels pointedto a resurgence in bookings out-side of the beleaguered

Eurozone, so investors in Millenium &Copthorne will be hoping that thecompany can replicate its larger peer’ssuccess in areas such as China and theUS. The operations in these areas

should benefit from continuing eco-

nomic growth, so investors might bewell advised to make their reservationssoon to avoid being locked out of growth further down the line. IG Indexquotes 485.48p-489.92p forMillenium & Copthorne.

Shares in Gulf Keystone havesoared since the beginning of the year,easily outperforming the broaderequity market. Investors expect theKurdistan-focused oil and gas explorerto profit from major finds in theregion, while there is also speculationthat the company is being targetedfor takeover by one of the oil majors.GFT quotes 426.25p-428.00p forGulf Keystone.

As far as annual results go, few willbe more eagerly anticipated thanRoyal Bank of Scotland’s on theThursday. From the dizzying heights of

the ABN Amro takeover to the subse-

quent credit crunch, RBS has had aturbulent run in recent years. With 83per cent ownership by the state, thepublic has a vested interest in thebank reporting well, but could be dis-appointed. While the bank continuesto restructure and sell off assets toboost its capital base, profit is likely todrop sharply on insurance mis-selling.ETX Capital quotes 28.17p-28.20p forRBS.

The FTSE hit a new six month highyesterday on the back of reduced cap-ital requirements for Chinese banksand increased hopes of Greece gettingits bailout money from the EU. Thismove higher is seen as a technicalbreakout to the upside and could befollowed by further strength. CapitalSpreads quotes a price of 5,650.0-5,951.0 for the FTSE.

Craig Drake

THETIPSTERTRADERS

HOPING TO

BOOK SUITE

OF PROFITS

The lines of communication out of Iran aren’t yet entirely closed Picture: GETTY

Wealth Management | Trading

22 CITYA.M. 21 FEBRUARY 2012

TRADERS looking at therecent actions of the theocra-cy of Iran – which confirmedits ban on the sale of crude

oil to the UK and France onSunday – might be forgiven forassuming that the escalating ten-sions between it and the West aregoing to be the biggest factorimpacting the price of Texas lightsweet and Brent crude oil. However,though war isn’t out of the ques-tion, it’s far from inevitable andthe global slowdown and Eurozonecrisis could leave those long on black gold not looking too slick.

A STORM IN AN OIL DRUM Julian Jessop, chief global econo-mist at Capital Economics, thinksalthough markets have interpretedrecent events as bullish for oilprices, “Iran’s position looksincreasingly weak and the regimemay now be close to backingdown.” Edward Bell, an economistat the Economist Intelligence Unit,says “the Islamic Republic has little

room to manoeuvre as sanctionscut deeper.” Bell points out thatexports to both the UK and Franceonly accounted for 60,000 barrelsper day in the first half of 2011 –less 3 per cent of Iran’s totalexports of crude. He think that if Iran really had wanted to make aretaliatory statement to the EUover its own ban on imports of Iranian oil, it could have stoppedshipments to Greece, Italy andSpain: the largest consumers of Iranian crude.

Jessop describes Iran’s banningof exports to the UK and France as“essentially an empty gesture”. Healso notes that even if Iran does pre-empt the EU embargo by stoppingsales to other European countries,the fragility of their economiesmeans that they may well need lessoil anyway: “Indeed, EU consump-tion of oil has fallen outright ineach of the last five years.” He believes “the impact of the Iranian ban may simply be to ensure thatmore of the burden of weaker

demand is felt by Iran than by other oil exporters.”

As the fuel that powers theengines of global growth, even if oilcontinues to rise in the short termit would upset any recovery in themedium term. Chris Beauchamp of IG Index notes “a surge in the priceof black gold could be just thething to disrupt the rally.” In turn,this would bring down the price of oil as the engines stutter again.

EVENTS MY BOY Traders need to keep an eye on theInternational Atomic Energy Agency’s (IAEA) visit to Iran and itsupcoming report in March. Bellsays “any statement that highlightsIran had been pursuing nuclear weapons at some point will raisetensions in the region and shiftprices upward.” On the other hand,as it did with Libya, theInternational Energy Agency (IEA)may once more release oil to offsetreduced supplies. Events could eas-ily slip traders up.

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8/3/2019 Cityam 2012-02-21


Wealth Management | Trading24 CITYA.M. 21 FEBRUARY 2012

GOLD has traded in a channel forthe last month, but despitethis, it remains at a price nighon unimaginable 18 months

ago. “Although the last month has been a quiet one for the price of gold,the metal is still up by around 10 percent for the year and is still almost$200 below the all-time highs set inSeptember last year,” says David Jones,chief market strategist for IG Index.He adds that, whenever gold is talkedabout there is always vociferous opin-ion among some that it is a bubbleand all bubbles burst. “This is a fairpoint – but it has also been a regularargument for at least the last three years and since then gold has dou- bled.”

Indeed, some have pointed to 1980for an example of what happens whengold crumbles and hope to profit when the same happens this time.But the current situation is drastically different. The 1980 high of $860 was

driven by runaway inflation hitting 14per cent and investors buying gold asa store of value and to protect their

wealth. At the same time, equities were at the beginning of the biggest bull run of a lifetime.

Now, gold’s attraction is largely itssafe haven status. With haven curren-cies overheating and debt timebombsticking in the majority of developedcountries, gold is seen as a safe placeto put your money.

The bottom fell out of the gold run when Fed chairman Paul Volckeraggressively hiked interest rates to try and curb inflation, in doing so remov-ing the main reasons to hold gold.

According to David Morrison, marketstrategist at GFT, Ben Bernanke could-n’t raise rates even if he wanted to,

and inflation looks likely to stay ahead of base rates for the foreseeablefuture. “With central banks in thedeveloped world printing money, gold will remain supported and physicaldemand is strong – central banks arenow net buyers of gold for the firsttime in over 20 years,” says Morrison. This doesn’t mean that gold will bestable – we should expect volatility inthe price as investors trade in and outof leveraged positions – but anybody hoping to profit from a gold crash aregoing to be disappointed.

FOREX STRATEGISTJOEL KRUGER

My pick: Looking to sell sterling-yen

Expertise: Technical analysisAverage time frame of trades: 1 day to 1 week

This market has been very well bid over the past several sessions andwhile we could indeed be in the process of seeing a major structuralshift, we also cannot ignore the severely overbought short-term tech-nical studies. The daily RSI has traded up by 80, and should our inhouse model permit, we recommend looking to sell rallies into criticalresistance by the multi-week highs at ¥127.30 for a ¥123.00 objective.Stop on close above ¥128.50.

FOREX ANALYST PICKS

Why not to position for a gold crash

FOREX STRATEGISTILYA SPIVAK

My pick: Stay short gold

Expertise: Global macroAverage time frame of trades: 1 week to 6 months

US economic data continues to broadly outperform expectations butheadwinds from a recession in the Eurozone that is likely already inprogress remain regardless of any progress made on the second Greekbailout this week. On balance, this suggests QE3 bets will be anchoredalong with inflation expectations while the safe-haven dollar recovers.This backdrop bodes ill for gold prices and I will continue holding short,aiming for a break of $1,714.05 to expose $1,677.05 initially.

QUANTITATIVE STRATEGISTJOHN KICKLIGHTER

My pick: Short S&P 500 Long euro-Swiss franc and dollar-yen

Expertise: Fundamental and technical analysis with riskAverage time frame of trades: 1 day to 1 week

There is a possibility that the EU could finally pass a major hurdlewith its next Greek vote. The positive outcome could offer a short-term relief rally, but optimism will be second guessed every step of the way. Nevertheless, such an outcome would help both euro-Swissfranc and dollar-yen longs. But, what about the alternative – a disap-pointment? I will stick with the S&P 500 as my risk-aversion setup,but the entry is moved up to 1,330.

The yellow metal

remains supported,writes Craig Drake

The wheels aren’t going to fall off gold Picture: GETTY

ANALYSIS l Gold today

$/oz

23 Jan 2012 30 Jan 2012 Feb 2012 13 Feb 2012

1,750.0

1,740.0

1,730.0

1,720.0

1,710.0

1,700.0

1,690.0

1,680.0

1,670.0

1,660.0

ANALYSIS l 1980 gold crash

$/oz

1 Jan 1 Feb 1 Mar 1 Apr 1 May 1 Jun 1 Jul 1 Aug 1 Sep 1 Oct 1 Nov 1 Dec

860.0

820.0

780.0

740.0

700.0

660.0

620.0

580.0

540.0

500.0

460.0

8/3/2019 Cityam 2012-02-21


8/3/2019 Cityam 2012-02-21


Lifestyle | Health26

Episode 47: AN INTIMATE MONDAY LUNCH

Isit opposite Caroline at the samesecluded table we used to sit at 10years ago. We’ve both moved onsince then. The restaurant hasn’t.

Caroline is clearly making a point.“How was your bonus?” she asks, as

the waiter retreats, having taken ourorder.

“We won’t go hungry,” I reply.Technically true, although I was actual-ly a little disappointed after last year’smunificence.

“I’m glad. Funny, isn’t it, how our liveshave become entangled once more?”she continues. “Me sneaking in ahead of you for last year’s City A.M. award.Then my boys rescuing Nick’s business,not to mention your own modestinvestment. And that Ozzie deal lastweek. Hope you didn’t mind that, David.Actually, I don’t know how we missedone another. Must have been downthere at the same time. It would havebeen nice to see you. Anyway, I’m sureyou have far bigger fish to fry.”

“All’s fair in love and war Caroline,” Ireply, feigning indifference but immedi-ately regretting the use of the “L” word.

“Oh, is that what this is?” she asks.“Does Emma know we’re having

lunch?”“Of course she does,” I lie.“You know, there’s never really been

anyone else. I mean, obviously I haven’tlived like a nun but… Even Sandy, well,you wouldn’t have to be a psychothera-pist to interpret my affair with yourboss, would you? And things ended somessily between us. Unresolved.” Shereaches across the table and places herhand upon mine. My gaze wandersfrom her hand, up her elegant, tonedarm, to find her eyes looking penetrat-ingly into mine. “I just wondered,whether you might feel the same?”

“Caroline, you, you ended it. Tenyears ago, And now I’m married, withthree children.”

But I have not moved my hand away.City Dad will continue next Tuesday.

For past episodes, go towww.cityam.com.

CITY DAD

FIT INTHE CITY

BY LAURA WILLIAMS

FITNESS & DIET EXPERT

Forget cyclingmachines, trythe Wattbike

I

must admit, I’m not a huge fan of cycling – I tend toassociate it with boredom and bulky thighs. But, given

that last weekend saw the track World Cup at thenew velodrome, coupled with the fact that cycling’s

one of the few feasible medal-winners for the Brits comethe summer, I fel t obliged to take up an offer by Wattbiketo try out its state-of-the-art indoor bike. Described as“the king of indoor trainers”, the Wattbike is actually theonly indoor training bike to be endorsed by British Cycling.

My first impression was that, unlike other stationarybikes that leave your legs feeling like lead but heart ratebarely raised, I was soon getting up a bit of a sweatwithout having dead legs, so it does do what it says onthe tin, which is to mimic the outdoor cycling experience.But the bit about the Wattbike that excites most cyclingenthusiasts and triathletes is the amount and precisionof data the bike records.

“The Wattbike’s proved very popular here”, says DianeKay, director of sales and marketing at the Reebok Clubin Canary Wharf, where I had my session. “Many of ourmembers are time-poor and want a highly efficientworkout that comes complete with accurate data andstate of the art software – basically a workout that com-pliments the rest of their working day”. Cadence, powerand heart rate are all recorded – as is your pedal tech-nique. This is the bit that got me – right in front of myeyes was a moving graph (known as the Polar View)showing the exact amount of force I was applyingthrough each leg during the entire pedal revolution. Evenas someone who’s usually left cold by statistics and tech-nology, this is a pretty impressive feature. And as there’sa “good” pattern to strive for: a “peanut” means yourtechnique is okay; a “sausage” is what an elite worldcyclist produces, and then there’s my own rather lamefigure-of-8. This aspect of the session alone is enough tokeep boredom at bay.

Whether you’re a cycling pro or someone who wantsto try a new bit of kit to shift those residual Christmaspounds, I’d highly recommend the Wattbike – as I tweet-ed after my session, “cycling, maths AND physics just gotinteresting.”For details on the Wattbike, including purchasing, hiring or clubs you can find them in: wattbike.com/uk Reebok Sports Club: www.reebokclub.co.uk @laurafitness; www.laurawilliamsonline.com

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Whether it’s crawling through mud or swinging through trees, thereare more creative ways to get fit than the gym, says Steve Dinneen

Get fit while the sun shines

T wo days without February’susual inclement weathershould have been enough torouse from hibernation the part

of your brain that craves exercise.Escape the tedium of the gym withthese get-fit options that take advan-tage of the weather – while it lasts.

TOUGH MUDDERRun by the special forces, ToughMudder is an insane 12 mile obstaclecourse that promises to “challenge you both mentally and physically by testing your strength, stamina and mentalgrit”. The scheme has been running forsome time in the US and will debut inthe UK for the first time in May. Thegruelling challenge – billed as the“toughest event on earth” – incorpo-rates crawling through mud, carryinglogs, swinging across monkey-bars andclambering up sheer walls.The first event will be held in Northamptonon 12/13 May. Go to toughmudder.com for more details.

GO APE This “treetop adventure” is basically anassault course in the sky. It features aseries of wires, bridges and ladders

strung from trees, where you can test your head for heights as well as youroverall fitness. The facility specialises incorporate events and claims to be anideal team-building exercise – especial-ly if your superiors suffer from vertigo.Go Ape has facilities across the country andcosts £30 for a single adult. Corporate eventscan be tailored to suit specific needs. Go to goape.co.uk for more details.

BRITISH MILITARY FITNESSCalling itself “the most challenging,motivating and sociable form of groupfitness in the UK,” this team orientedregime is, predictably, run by military fitness instructors. The hour-longclasses have been developed over thelast 12 years to squeeze as much out of you as humanly possible. If you are thekind of person who gives up on thetreadmill without someone yelling at you, this is probably the right coursefor you.Classes in Hyde Park cost £50 a month for unlimited classes, in addition to a £25 mem- bership fee. Go to www.britmilfit.com for more details.

POWER LEAGUENow that the worst of the cold is over

it’s time to dust off your boots andhit the five-a-side pitch. Football has been proven to be better for youroverall fitness than going to the gymand it’s a great excuse to get together with your mates for the evening.Power League has pitches in Wembley, Old Street, Barnet,Croydon and Tottenham where youcan either play a casual game or joina tournament to prove who has thesilkiest skills in London. Log on to www.powerleague.co.uk for moredetails.

URBAN GYMEscape the boredom of the gym withthese outdoor exercise classes in theheart of the City. Groups meet near StPaul’s, where they will be instructed incircuit-based training combined withshort running sections. The sessionstake place in the City but the firmpromises to take in some unusual, hid-den away spots: ideal for those who want to avoid bumping into the bosshalf way through your workout. Alllevels are catered for. Prices start at £24 a month with a minimum 12 month contract. Go towww.ratrace.com for more details.

(clockwise from left) A ToughMudder event in the US; a

British Military Fitness session;an Urban Gym runner; a Go Ape

treetop adventure facility

8/3/2019 Cityam 2012-02-21


Wright BrothersSoho Oyster House13 Kingly Street, W1B 5PWTel: 020 7434 3611, thewrightbrothers.co.uk

FOOD hhhhi

SERVICE hhhhiATMOSPHERE hhhhi

Cost per person without wine: £40

T

HE Wright Brothers’ establishmentin Borough Market is a temptation

that is sorrowfully hard to indulge because it is tiny – and rammed. The

former contributes considerably to itscharm: at few other places would I waithalf an hour for a stool at a beer barrel. But

when it comes to oysters, beer and top-drawer seafood in the Wright Bros style,more space can only be good.

Enter the new(ish) outlet in Soho:known as the Oyster House rather than theOyster & Porter House of Borough, it’s big-ger and quite possibly better. Decor doesn’tsuffer – set over two levels, it still manages

to feel cosy, but with the clattery vibrantatmosphere one desires of Soho.

In London, oysters have always been pop-ular, though in Dickens’ day they were notconsidered the delicacy they are now and

were often shoved in pies alongside godknows what else. These days, they tend tocome with high prices and a degree of pomp. For example, the famous oyster barsat Scott’s (first opened on the Haymarketin 1858), J Sheekey’s and Bentley’s are all

Wright Bros Sohorestaurant offersmore space: which isa good thing.

Prime oysters and arange of wonderful

fish make WrightBrothers’ biggeroutpost a true delight

Soho oyster bar is a serious catch

excellent and historically-weighted. WrightBros, by contrast, feels more casual andaccessible to the after-work crowd, ratherthan the business people or tourist crowd,and it is much cooler for it.

Staff are lovely and helpful, ideal con-duits for the astoundingly succulent plateof oysters we’re about to have (washeddown with some English sparkling wine –

what else? – before moving onto a whiteRioja).

The Duchy Natives and Lindisfarnes were good, but the Cumbrae blew us away (the cheapest of the lot at £6.50 for three). Iam not the biggest poster girl for oysters as

I have a fear of being sick, but any reserva-tions I’d had were firmly stamped out withthis paen to the marine: the Cumbrae wereenormous and salty, but in a fragrant way that only the best are. After this, the caviarand cream-topped pearls we’d decadently ordered just lost their sheen. I am pleasedto report that none of the oysters made ussick, nor were they likely to.

Then order the fish of the day, especially if it’s anything like the great big roast brillfor three we shared between two, with per-fect new potatoes and broccoli. Fish canpack just as much a punch as beef: I wasfelled by far less than half the fish as my companion deftly continued scoring andserving it up. There was a touch of sea bassto the brill, but meatier, with a silky tex-ture and buttery f lavour.

By now, full on the finest the sea has tooffer and drunk on the best of Spanishgrapes, we thought puddings would be afine idea. Bakewell tart (tart of the day)

tasted terrific but my connoisseur friend was concerned by its flimsiness; chocolatepot with hazelnut praline hit the spot.

Wright Bros does not expect everyone to want oysters and massive whole fish. Thereare playful and less playful alternatives:seafood biryani, sardines on toast and gar-lic butter, fish pie and even braised pork

belly with clams and salsa verde.Go for the raw bar alone or go for a prop-

er dinner with all the fixings of oceanicdecadence, from caviar to oysters to crab.Either way, go.

Lifestyle | RestaurantsCITYA.M. 21 FEBRUARY 2012WORDS BYZOE STRIMPEL

27

8/3/2019 Cityam 2012-02-21


T E R

R E S T R I A L

DEATHUNEXPLAINED

BBC1,10.35PMWest London coroner AlisonThompson and her team investigatemore mysterious deaths, including aman hit by an Underground train.

HOWTO GROW A PLANET

BBC2,9PMIn the last episode of the series,Iain Stewart explores the part played

by grass in major changes to theplanet throughout history.

THE BRITAWARDS 2012

ITV1,8PMJames Corden returns to London’s O2to host the annual music ceremony,with performances by Adele, BrunoMars, Coldplay and Rihanna.

BBC1

SKY SPORTS 17pm Sky Sports News at Seven

7.30pm Soccer Special 10.00pm

Revista De La Liga 11.00pm

Football Asia 11.30pmFootball’s

Greatest Managers 12am UEFA

Champions League Highlights

1am Football Asia 1.30am Live

Women’s International Twenty20

Cricket 5am-6amUEFA

Champions League Highlights

SKY SPORTS 27pm Live UEFA Champions

League 10.15pm Poker 12.15am

International One-Day Cricket

2.45am-3.45am Cycling

SKY SPORTS 37pm Cycling 8pm International

One-Day Cricket 10.30pm

Golfing World 11.30pmBritish

Basketball 1.30am FIBA

Basketball 2am Revista De La

Liga 3am UEFA Champions

League Highlights 4am Football’s

Greatest Managers

4.30am-5.30amRevista De La

Liga

BRITISH EUROSPORT6.30pmWTA Tennis 8pm Alpine

Skiing 9pmBoxing

11pm-12.25amWorld

Superbikes

ESPN5.30pm Live Serie A 7.30pm

French Top 14 Rugby Union 8pm

NBA 10pm Eredivisie ReviewShow 11pm ESPN Kicks: FA Cup

11.30pmESPN Press Pass 12am

Serie A – Rivals 12.30amNHRA

Drag Racing 3.30am Planet

Speed 4am Premiership Rugby

Union5.30am-6amFrench Top

14 Rugby Union

SKY LIVING7pm Criminal Minds 8pm The

Biggest Loser 9pm Unforgettable

10pm Criminal Minds 11pm

Bones 12am CSI 1.50amMaury

2.40amMedium 3.30amBones

4.20amNothing to Declare

5.10am-6am Jerry Springer

BBC THREE7pm Winter Wipeout 8pm Don’t

Tell the Bride 9pm Junior

Doctors: Your Life in Their Hands

10pm EastEnders 10.30pmLittle

Britain11pm Family Guy

11.45pm American Dad!

12.30am Junior Doctors: Your

Life in Their Hands 1.30am Don’t

Tell the Bride 2.30am LittleBritain3am Live at the Apollo

3.30amYoung Carpenter of the

Year 4.30am-5.25amMy

Hometown Fanatics: Stacey

Dooley Investigates

E47pm Hollyoaks 7.30pmHow I

Met Your Mother 9pm 90210

10pm The Cleveland Show

10.30pmBob’s Burgers 11pm

Sirens 12am The Big Bang

Theory 12.55amScrubs

1.55amHow I Met Your Mother

3.05am Rules of Engagement

3.25am Balls of Steel Australia

3.55am Greek 4.35am Ugly

Betty5.20am-6am Switched

HISTORY7pm Storage Wars 7.30pm Pawn

Stars8pm American Pickers

10pm Seeking Salvage 11pm

UFO Hunters 12am Pawn Stars

12.30am Storage Wars 1am

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Hunters 3am Only in America4am The True Story 5am-6am

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X-Machines 9pm Swords: Life on

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Breaks 11pm Wild Britain with

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4.40am More Industrial

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Diagnosis10pmBaby ER 11pm I

Didn’t Know I Was Pregnant

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Was Pregnant 3am Supernanny

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SKY17.30pmGot to Dance: Semi-

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Marshals 1998. 12.30am 35mm

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BBC2 ITV1 CHANNEL4 CHANNEL5

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6pm Eggheads

6.30pm Britain’s Heritage

Heroes

7pm Raymond Blanc: The Very

Hungry Frenchman: The chef

visits Lyon.

8pm Alex Polizzi: The Fixer

9pm CHOICEHow to Grow a

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You

10.30pmNewsnight: Weather

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8pmCHOICE The Brit Awards

2012: Music ceremony from

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10pm ITV News at Ten10.30pm London News

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11.35pmThe Cube: A Royal

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12.30am The Zone; ITV News

Headlines3am Crossing Jordan

3.45am-5.30am ITV Nightscreen

6pm The Simpsons

6.30pm Hollyoaks

7pm Channel 4 News

7.55pm 4thought.tv8pmGok’s Teens: The Naked Truth

9pmBig Fat Gypsy Weddings

10pm Shameless 11.05pm

Random Acts 11.10pm Desperate

Housewives 12.10am Poker

1.10am Sailing: America’s Cup

Uncovered 1.35am KOTV Boxing

Weekly 2amBest of British

2.55am Late Night Poker 3.50am

GT Academy 4.15am Daytona 24:

The Story of the Daytona Challenge

2012 4.45am That Paralympic

Show 5.10am-6.05am Road to

London 2012: Paralympics Extra

6pm Home and Away

6.30pm 5 News at 6.30

7pm Police Interceptors:

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8pm Braveheart: The True

Story: 5 News at 9

9pm Body of Proof

10pm Whitney’s Addictions:

Death of a Diva11pm CSI: NY

12am CSI: Miami

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5.10am Michaela’s Wild Challenge

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8 10 17

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45

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38

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27

12

23

16

29

25

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34

16

11

11

15

10

28

22

19

39

Fill the grid so that each block

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above or to the left of it.

You can only use the digits 1-9

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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 Writing implements (4)

3 Contrite (5)

6 Ready money (4)

7 Spanish sparklingwhite wine (4)

9 Former, onetime (9)

11 Tendon connectingmuscle to bone (5)

12 Building (7)

15 Farm with acilitiesor livestock (5)

17 Person displayingostentatious or smugcleverness (coll) (5,4)

18 Badgers’ den (4)

19 Salt o carbonic acid, usedin soap powders (4)

20 Hibernated (5)

21 Red eruption o the skin (4)

DOWN

1 Chooses (5)

2 Frightened (6)

3 Woman whodances in achorus line (8)

4 Dwelling place (9)

5 Countrybumpkin (5)

8 Impressive byreason o age (9)

10 Most astmoving (8)

13 Form o addressor Romanemperors (6)

14 Drug addicts (5)

16 Snag, difculty (5)

S

E

P

R

ED

T

I

S

S I D L E S J H

O R T O U C A N

F E A R A L V

T U T Y P E S E T

S U G A R O P I N E

O H I F S M A

A Z T E C T R U E R

P O S S E S S L D

N T P B A K U

G A T E A U T C

L R R O B E R T

9 1 8 6 9 1 6 3

7 2 9 8 6 2 4 1

7 2 1 8 9 6

2 4 5 1 3 1 5 2

9 5 9 5 8 4 7

1 2 4 3 6 2 8 9

6 8 7 5 9 3 1

6 3 9 1 3 6 2 4

9 8 1 2 4 7

5 1 3 2 2 9 7 1

8 7 9 3 7 8 9 6

WORDWHEELThe nine-letter word was

DESTROYER

Lifestyle | TV& Games CITYA.M. 21 FEBRUARY 201228

8/3/2019 Cityam 2012-02-21


Sport 29CITYA.M. 21 FEBRUARY 2012

ENGLAND batsman Eoin Morganinsists Alastair Cook’s one-day sidecan take a step towards mirroring theachievements of the Test team inreaching No1 in the world by com-pleting a 4-0 series whitewash againstPakistan today.

Back-to-back centuries for Cook, acombined total of 11 wickets forSteven Finn and a timely return toform for Kevin Pietersen representthe highlights of a series which has

seen England salvage something tan-gible from a sobering tour.

Following Saturday’s nine-wicket victory, Cook’s men go into today’smatch at the Dubai InternationalCricket Stadium on the verge of gain-ing some measure of revenge for the3-0 Test reversal, an accomplishmentthat would advance both England’slong and short-term objectives,according to Morgan.

“Where we are is six in the world; where we want to be is No1 in the

world by the World Cup in 2015,” hesaid. “We do want to win 4-0, and if the opportunity arises we could giveplayers a bit of experience. But thepriority is to win the game.”

Morgan was among a clutch of batsmen who went into the Testsagainst Pakistan undercooked andstruggled against spin as a result.

In order to prevent a repeatEngland Cricket managing directorHugh Morris confirmed yesterday that several members of the currenttouring party, including Andrew Strauss and Ian Bell, will head to Sri

Lanka early with batting coachGraham Gooch to acclimatise aheadof two Tests in March and April.

“We will be sending some of the Test squad to Sri Lanka early, particu-larly some of those who have not

been playing in the last month or so[during the ODI series with Pakistan],Morris said. “They will be working

with Graham and one or two of thecoaches and support staff at gettingacclimatised and preparing on SriLankan wickets.”

Morgan eyesup Pakistanclean sweepBY JAMES GOLDMAN

CRICKET▲

MAKING A SPLASH | Chinese duo strike gold in London

LONDON’S magnificent new Olympic Aquatics Centre hosted its first day of competitiveaction yesterday with China’s divers taking gold in a World Cup event chosen to test thevenue. World champions Qin Kai and Luo Yutong won the men’s synchronised 3-metresspringboard ahead of Russia’s Ilya Zakharov and Evgeny Kuznetsov, while Malaysia’s Brian Nickson Lomas and Huang Qiang took the bronze. Picture: REUTERS

Results

email [email protected]

SPORT | IN BRIEF

Kauto star avoids illnessHORSE RACING: Champion trainer PaulNicholls has revealed some of his horsesare coughing – but not stable starsKauto Star and Big Buck’s. Nicholls con-firmed the duo avoided the illness whichhas struck at his Ditcheat stables lessthan a month before the Cheltenham

Festival

Bennett to miss England clashRUGBY UNION: Wales hooker HuwBennett looks likely to miss Saturday’sSix Nations clash with England becauseof a calf injury.

8/3/2019 Cityam 2012-02-21


Sport30

T

HE pick of Tuesday night's

Champions League action seesan under pressure Chelsea sidetravel to one of the toughest

grounds in European football, theStadio San Paolo. Andre Villas-Boas

was supposed to be the new JoseMourinho but as yet, he’s been unableto get his Chelsea team anywhere nearthe heights that their former manag-er achieved. Having gone four games

without a victory, including a draw inthe FA Cup at Stamford Bridge thispast weekend against Birmingham,this hugely important game could notcome at a worse time for Chelsea.Napoli manager Walter Mazzarri has

done a great job since his arrival in

2009. Not only did the Azzurri finishin third place in last season’s Serie A,they have also qualified for the knock-out stage of this competition, beatingManchester City in the process.Mazzarri is banned from the touch-line for both legs of this tie but I don’t

believe that will have any affect on thefinal result. Napoli have a great recordat home where European football isconcerned and I have to side with theItalians tonight.Best Bet:

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BRITISH heavyweight David Haye haspromised to co-operate with boxingchiefs over his press conference brawl

with Dereck Chisora – but was lastnight still wanted for questioning by German police.

Both fighters face possible criminalcharges and the threat of jail, as wellas bans from the British Boxing Boardof Control, following the fracas inMunich on Saturday night.

German police quizzed Chisora butsearched in vain for Haye on Sunday,and the 31-year-old confirmed yester-day that he fled Germany earlier thanplanned as he feared for his safety.

Chisora shouted “I’m going to shoot you” at Haye following the melee, andHaye said: “In light of the threatsChisora had made… it seemed farmore appropriate for me to leave thehotel as quickly as possible.”

He added: “If requested, I shall hap-pily assist the boxing authorities withany investigation.”

But German police said they still wanted to quiz Haye and would ask British counterparts to assist. “Until

we speak to Haye, nothing more canhappen,” said a spokesperson.

Haye readyto talk but

still wantedBY FRANK DALLERES

BOXING▲

Haye fled Germany early following themelee with Chisora Picture: GETTY

STRUGGLING Arsenal were last nighturged to consider issuing new sharesin a bid to bolster their finances andfree up cash for new players.

The Gunners are poised to confirmmore healthy financial results, withlast summer’s sales of Cesc Fabregasand Samir Nasri swelling their avail-able cash to £50m.

But that could be obliterated if they miss out on next season’sChampions League, which would costthe club around £45m, the ArsenalSupporters’ Trust estimate.

The AST has asked the board andmajority shareholder Stan Kroenke to

reconsider a rights issue, should theclub miss out on the top four.

Kroenke’s rival shareholder AlisherUsmanov proposed the step in 2009,arguing that the team needed freshcapital to end their silverwaredrought. The board rejectedthe idea then as unneces-sary, citing advice frommanager Arsene Wenger,

but the AST believes it is timeto pose the question again.

Incoming FinancialFair Play laws wouldallow new money to

be used to pay downremaining stadiumdebt, freeing upfunds for Wenger toinvest in his strug-gling team.

Kroenke (right), who will fly into

London for a board meeting this week, may be reluctant to endorsethe move as it would force the

American to either plough mil-lions of pounds into the club oraccept a watering-down of hisstock. Extra shares could fallinto the hands of Russian bil-lionaire Usmanov, who has

been snapping up stock in a bid to take his holding

over 30 per cent.“This could flush out

whether Kroenke is just interested imoney,” the AST’s TimPayton told City A.M.“An issue would meanthat he benefits from

having a stronger andhealthier club.”

Villas-Boas

calls for clubto back himUnder-fire Blues boss chooses eve of ChampionsLeague clash to request the support of the board

CHELSEA manager Andre Villas-Boas has responded to fresh ques-tions regarding his future by challenging the club’s hierarchy tounderline their faith in his ability

by providing him with public back-ing.

A 1-1 draw at home againstBirmingham in the FA Cup onSaturday, a performance greeted

with jeers at the final whistle, trig-gered fresh speculation ahead of tonight’s Champions League clashin Naples that the Portuguese

would fail to see out his f irst seasonin the job.

Villas-Boas remains confident he will avoid becoming the sixth man-agerial casualty of the Roman

Abramovich era but, in front of watching chairman Bruce Buck and chief executive Ron Gourlay,declared his words would continueto ring hollow until a senior clubofficial put their head above theparapet to offer words of support.

“It’s the richest part of Chelsea’s

history, full of trophies and suc-cess, and you want to perpetuatethat into the future,” said the 34-

year-old. “To do that, you have tosometimes make changes because

you cannot sustain the same habitsthat you had in 2004.

“These words would be more valuable coming from the top. Icannot keep saying them but, asthe voice of the club, I will contin-ue to perpetuate this message

because this is what we believe in.” As a consequence of their

wretched domestic form the Blueshave been chalked up as underdogsfor tonight’s last 16 first leg clashagainst a Napoli side who havealready ended Manchester City’sinvolvement in the competition.

Having presided over such analarming fall from grace the for-mer Porto boss was willing to con-cede he is hardly on the firmest of ground at present but revealed he

was confident enough in his role tohave already embarked on the task of plotting for next season.

He said: “In terms of the resultsthis year, the speculation is normalgiven the cultural past of this foot-

ball club, but there’s a differentperspective now.

“I’m confident about next year. We had a three-year project tochange not only the team, but theculture and structure of the club.”

BY JAMES GOLDMAN

FOOTBALL▲

NAPOLI

CHELSEA

Arsenal urged to consider rights

issue to protect £50m war chestBY JULIAN HARRIS

FOOTBALL▲

Villas-Boas’s Chelseaside are underdogsagainst Napolitonight

Picture: GETTY

8/3/2019 Cityam 2012-02-21


31

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THE RYDER Cup might still beseven months away but bothteam captains will be castingtheir eyes over events at the

Match Play Championship in Tuscon this week.

It might be early in the season but it’s certainly an opportunity,

should the draw go to form, for oneor two Europeans to gain a psycho-logical advantage over potentialopponents in September.

Luke Donald will be looking todefend his title and although hestruggled in his final round at last week’s Northern Trust Open he’sgot to be considered a contender.

If I was to select one European todo well this week, however, it would be Sergio Garcia. TheSpaniard, a couple of poor misses with his putter aside, showed last week he’s in the sort of form whichhelped him win consecutive titlesat the back end of 2011.

Garcia’s cause will be advanced by the high-profile absence of Phil

Mickelson, who has chosen to takea week off rather than continue his

fine recent resurgence. Lefty is asphysically fit as I’ve seen him for 10 years and his game is back to where it was at its peak as a result.

Bill Haas’s splendid victory inCalifornia was somewhat overshad-owed by the eccentric behaviour of runner-up Keegan Bradley whodrew a lot of negative criticism forhis incessant spitting.

It wasn’t particularly pleasant viewing but I don’t think he should be punished. For his own benefit,however, he could do with calmingdown and refining his pre-shotroutine – he was like a man pos-sessed over those closing six holes.Sam Torrance OBE won 21 European Tour titles and is a former Ryder Cup captain.

Follow Sam on twitter @torrancesam

Top Europeans can lay down

some early Ryder Cup markers

ENGLAND head coach Stuart Lancasteradmits he will shuffle his pack to accom-modate the returns from injury of Manu Tuilagi, Toby Flood and Courtney Lawes ahead of Saturday’scrunch Six Nations showdownagainst Wales.

Tuilagi (inset), who hasnot represented his country since leaping from a ferry inNew Zealand followingEngland’s World Cup exit inOctober, returned from ahamstring injury for Leicesterat the weekend and is in con-tention to play some part against Warren Gatland’s men who, like the Red

Rose, have won two from two.“It’s nice to have people like Manu

coming back into the equation,” saidLancaster. “It’ll be an interesting deci-

sion but I think he’ll be playing somepart.

“Manu, Toby and Courtney haven’tplayed a lot recently and to play interna-tional rugby you have to be playing atthe sharp end of domestic rugby. I’m

delighted they got some gametime at the weekend.”

Lancaster’s regime hasthus far yielded morale- boosting, albeit narrow vic-tories away from homeagainst Scotland and

Wales. The former Saxons coach

named the same team on both occasions but admitted

he would make alterations forthe visit of Wales to Twickenham.“There will be one or two changes

from the Italy game and we certainly think our bench will be an importantfactor going into the second half,” hestated.

Lancaster ready tinker as

key trio return from injury

GOLF COMMENT

SAM TORRANCE

BY JAMES GOLDMAN

RUGBY UNION▲

FORMThey may be struggling to match the heights of lastseason’s top three finish but Napoli are currently on adecent run, having lost just once in nine Serie Agames and not conceded in more than sixhours. Friday’s 3-0 win at Fiorentina leftthem sixth in the table.

EUROPEAN CLOUT

Napoli are unbeaten in 11 Europeangames at the Stadio San Paolo, includ-ing visits from Bayern Munich andManchester City in the group stage.They deserve immense credit for advancingamid that standard of competition, while play-ing some of the most stylish, swashbuckling football –all in their first season in the Champions League.

THE BOSSWalter Mazzarri, who started his coaching career as an

assistant at Napoli 14 years ago, has brought glory backto the club since taking charge in 2009. However, the50-year-old is suspended for both legs of the Chelsea

tie, following a dugout altercation againstVillarreal in the group stage. Assistant

Nicolo Frustalupi will take the reins in hisabsence, and Mazzarri quipped: “I'msorry I can't be on the bench butFrustalupi is perhaps better than me

as a tactician.”

DANGER MENThe attacking triumvirate of Marek

Hamsik, Edinson Cavani (inset) andEzequiel Lavezzi are the envy of Europe,

although the latter is still to net in the ChampionsLeague. Happily, the formidable Cavani has rattled fourin six games, while Hamsik’s scheming and bursts frommidfield have garnered a further two. All three starredin their vital 2-1 win over City in November.

KNOW YOUR ENEMY: NAPOLI

Madman Bielsa linked with

Stamford Bridge hotseatFORMER Argentina and Chile coachMarcelo Bielsa has been sounded outabout replacing Andre Villas-Boas atChelsea, according to reports in Spain.

Bielsa, whose eccentricity has earnedhim the nickname Madman, has only been in charge at Athletic Bilbao sincethe start of the season. But he is said to be willing to consider switching to StamfordBridge in the summer after hearing hecould be wanted by Blues chiefs.

Valencia’s promising coachUnai Emery is also in the frameto replace Villas-Boas, say Spanish media, althoughhe lacks the pedigree of the Argentine.

Bielsa endured amixed spell with hisnational team, with adisappointing 2002 World Cup campaignoffset by Olympic goldand a Copa America runners-up spot in 2004.

But he earned hero status with South American neighbours Chile, leading

them to the 2010 World Cup followingan eight-year absence.

The 56-year-old, who snubbed inter-est from Inter Milan to take over atunfashionable Athletic last summer, is

known for his tactical rigidity, insist-ing his teams press high up the

pitch in a 3-3-1-3 or 4-3-3 forma-tion. Bielsa’s new players took a few matches to adjust, fail-ing to win any of their firstfive league games, but arenow just goal differencefrom a Champions Leagueplace.

BYFRANK DALLERES

FOOTBALL▲

Nationality Argentinian Age 56Notable jobs Velez Sarsfield (1997-98);Espanyol (1998) Argentina (1998-2004);Chile (2007-11); Athletic Bilbao (2011-)Preferred tactics High pressing game basedon 3-3-1-3 or 4-3-3

FACTFILE | MARCELO BIELSA

FIRST PAKISTAN AND

THEN THE WORLDMORGAN OUTLINESENGLAND TARGETS: P29

8/3/2019 Cityam 2012-02-21


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