PRESS DIGEST – British business – July 24

The Times

INQUIRY INTO TALKTALK BILLS DISPUTE

Ofcom has launched an investigation into the practices of
Internet provider TalkTalk (TALK.L: ) after a number of customers
accused the group of using heavy handed tactics to chase
payments. Former customers of Tiscali, who switched to other
providers when TalkTalk increased their monthly fees after
acquiring the business last May, allege that they are being
pursued for money they do not owe. In some cases debt collectors
are being used. The inquiry could take up to six months and the
regulator could impose a maximum fine of ten percent of
TalkTalk’s revenue.

RIVAL BIDDERS BEGIN 2.6 BILLION POUND BATTLE OVER ATOMIC
PLANT

Two rival bidders are to enter formal bid discussions for a
2.6 billion pound contract to decontaminate the Dounreay atomic
research plant. The contract has been put out to tender by the
Nuclear Decommissioning Authority. Caithness Solutions, a joint
venture between American nuclear clean-up specialist Energy
Solutions and British engineer Amec, will be competing against
Babcock Dounreay Partnership, a venture including Babcock
Nuclear Services and U.S. firms CH2M Hill International and URS.

VODAFONE RESULTS EASE PRESSURE ON COLAO.

Vodafone (VOD.L: ) reported growth for the first time in 18
months on Friday, validating the strategy of chief executive
Vittorio Colao and strengthening his hand. However, Colao did
not publicly back chairman Sir John Bond, who has been the focus
of criticism from unhappy investors. A number of investors
intend to vote against Bond’s re-election at Tuesday’s annual
meeting. Colao refused to comment on investors’ criticism of the
company’s performance under Bond’s stewardship, saying: “I am
not going to discuss the views of any individual shareholder in
public.”

NEED TO KNOW: CLOSE BROTHERS

Close Brothers (CBRO.L: ), the British merchant bank, hopes to
announce solid full-year results after bad debts among its
customers improved slightly. News of the improvement came in a
trading statement in the run-up to the end of Close Brothers’
financial year.

NEED TO KNOW: BRITVIC

Drinks manufacturer Britvic (BVIC.L: ), which produces the
Robinsons and Tango brands, has announced a 6.9 percent increase
in sales in the third quarter. The company said it was confident
it would meet full-year expectations.

The Daily Telegraph

MARKS & SPENCER PULLS OUT OF FOUR TOWNS

Marks & Spencer (MKS.L: ) (MKS.L: ), the retailer, is pulling
out of four towns in England as it closes unprofitable stores.
The closures will be in Nuneaton, Grantham, Skegness and
Scunthorpe with the loss of an estimated 150 jobs. A Marks &
Spencer spokesman said the stores had reported declining sales
and profits for a number of years and are no longer commercially
viable. The stores are expected to close early next year. M&S
announced in January 2009 that 27 stores would close. Of those,
25 were Simply Food stores, only two were full-service shops.

U.S. HEDGE FUND ADDS TO PUNCH STAKE

Glenview Capital, the U.S. hedge fund, has increased its
stake in Punch Taverns (PUB.L: ), the pub group. The fund
increased its voting rights to 13 percent. This comprised of two
percent in shares and 11 percent in financial instruments.
Glenview had increased its stake to ten percent last Friday.
GLG, another hedge fund, has increased its stake above three
percent. Investors are believed to be attracted to Punch as a
proxy for backing increased UK consumer confidence. Analysts
said the group’s shares remain volatile due to its relatively
high net debt.

QINETIQ’S ZEPHYR FLIES TO RECORD

Defence research firm Qinetiq (QQ.L: ) has become increasingly
confident over the prospects of securing a military order in the
UK and USA after its solar-powered unmanned plane beat the
record for the longest flight without refuelling. The Zephyr
aircraft, which collects energy in its solar panelled wings
during the day and stores it in lithium-sulphur batteries to
power the plane overnight, landed in Arizona desert after being
in the air for 14 days and 24 minutes.

OCADO STOCK SHORTED BY HEDGE FUNDS

Online grocer Ocado is facing the prospect of a campaign of
short trades by a group of hedge funds who are convinced shares
in the company are overpriced. Shares in Ocado fell by more than
seven percent on its stock market debut but hedge funds are
using the so-called “grey period” of pre-trading to take large
bets that shares in the firm will fall further. The precise
volume of short trades is expected to become clearer in the week
ahead, which is when Ocado shares will begin trading as
“physical” stock that can also be borrowed.

The Independent

PENSIONS BLOW FOR BT AS OFCOM BLOCKS PRICE RISES

Ofcom, the communications watchdog, has rejected plans by BT
(BT.L: ) to tackle its 7.5 billion pound pension deficit. The
regulator decided against altering how it takes the
communications group’s pension costs into account when setting
charges for rival companies to use its services. A BT insider
said the decision was “neutral”, suggesting that a more positive
result would have recovered “tens of millions of pounds” but
would not have had a material impact on the deficit. BT
currently injects 525 million pounds a year into the deficit but
has failed to agree a plan with the Pensions Regulator.

The Guardian

PUBS AND BREWERS CASH IN AS HOT WEATHER DRIVES BRITONS TO
DRINK

Fuller Smith & Turner (FSTA.L: ), the pubs and brewing
company, has posted a 4.1 percent rise in like-for-like sales
for the 16 weeks to 17 July as a result of the recent hot
weather. Michael Turner, chairman, said: “The hot weather is our
best salesman”. Recent updates from JD Wetherspoon (JDW.L: ),
Punch Taverns (PUB.L: ) and Greene King (GNK.L: ) have all indicated
an upturn in business over the recent weeks.

Stock Market Basics

Prepared for Reuters by Durrants

PRESS DIGEST – British business – July 24