PRESS DIGEST – British business – May 9

The Sunday Telegraph

BRITAIN SIDELINED OVER EU HEDGE FUND TALKS

Decisions on hedge fund and private equity regulation in
Europe could be taken without input from Britain as the
country’s party leaders negotiate the outcome of a hung
parliament. The draft directive on alternative investment fund
managers is up for a vote before the European Parliament on
Monday. Insiders believe that a draft, described by one MEP as a
“protectionist dog’s breakfast”, will be rubber-stamped due to
an agreement between the Socialists, Communists and the Green
Party. Britain could also find itself without a voice at the EU
finance ministers’ meeting on May 18.

SIR ROY GARDNER LANDS CHAIRMAN ROLE AT CONNAUGHT

Sir Roy Gardner is to become chairman of Connaught (CNT.L: ),
the FTSE 250 support services company. Gardner, also chairman of
Compass Group (CPG.L: ) and Plymouth Argyle football club, is
thought to have been attracted to Connaught by the potential for
picking up large-scale public sector outsourcing contracts as
local authorities react to pressure to cut costs. Gardner’s
arrival marks the final stage of a board restructuring which
included the departure in January of chief executive Mark
Davies.

BP CHIEF REVEALS $10 MILLION DOLLAR DAILY BILL

Tony Hayward, chief executive of BP (BP.L: ), has ordered a
complete safety overhaul of all of the energy giant’s rigs after
admitting that the Deepwater Horizon disaster resulted from the
fundamental failure of a “blow-out preventer” cut-off valve.
Hayward said that he expects regulators to impose a number of
new safety measures in the Gulf of Mexico and elsewhere, with
the cost of drilling expected to increase as a result. Hayward
also said that the daily cost of the clean-up operation has
increased from six million dollars to ten million dollars. The
company is currently preparing to drop a dome over the well,
which is leaking 5,000 barrels of oil into the Gulf each day.

BT CUTS 35,000 JOBS, RESULTS SHOW ONE BILLION POUND PROFIT

This week, telecoms firm BT (BT.L: ) will announce that it has
cut 35,000 jobs as it looks to return to profit. The company had
intended to cut 15,000 positions in the year to April, having
cut the same number in 2008, but will tell investors that it has
exceeded the total target by 5,000. Finance director Tony
Chanmugam is thought to have targeted a further 5,000 cuts this
year to reduce the company’s total headcount from 162,000 to
122,000. Full-year results on Thursday are expected to reveal
full-year pre-tax profits of between one and 1.1 billion pounds.

FEAR OF SALES SLOWDOWN AT SAINSBURY’S

Analysts expect supermarket chain J Sainsbury (SBRY.L: ) to
announce on Thursday that pre-tax profits rose 15 percent to 595
million pounds in the year to the end of March. Like-for-like
sales are thought to have risen 4.3 percent over the year.
Sainsbury’s is not expected to provide an update on trading
since the year-end, a period in which the company is thought to
have suffered a sales slowdown similar to that experienced by
rival Wm Morrison (MRW.L: ), which saw like-for-like sales growth
fall from 6.5 percent over the Christmas period to 0.8 percent
in recent weeks.

SUNDAY QUESTOR

Centamin Egypt (CEY.L: ) (Buy)

Hill & Smith (HILS.L: ) (Buy)

The Independent on Sunday

L&G LEADS CALL FOR PRU TO CUT AIA DEAL PRICE

British financial services firm Prudential (PRU.L: ) is facing
increasing pressure from shareholders over its attempts to buy
AIA, the Asian operations of US insurance group AIG.
Institutional investors, including Legal & General (LGEN.L: ),
Fidelity, Blackrock and Capital, have privately voiced concerns
about the cost of the deal and could between them block the
Pru’s currently postponed 20 billion dollar rights issue that is
intended to raise funds for the acquisition. In order to appease
investors, Prudential may decide to make its rights issue more
attractive by increasing the number of shares offered.

The Observer

BANK OF ENGLAND EXPECTED TO HOLD INTEREST AT 0.5 PERCENT.

UK central bank the Bank of England is expected to hold
interest rates at their current record low of 0.5 percent when a
decision is announced on Monday. The Bank traditionally
publishes its decision on the first Thursday of the month, but
delayed May’s announcement to avoid clashing with the general
election. The Bank will also release revised inflation
forecasts. Analysts are concerned that the Bank may be forced to
raise interest sooner than expected in order to contain
inflation, which the consumer price index shows to be higher
than most of Europe at 3.4 percent.

Investing

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PRESS DIGEST – British business – May 9