PRESS DIGEST – British business – Sept 5

The Mail on Sunday

WALSH PLANS BIGGEST INTERNATIONAL AIRLINE

The chief executive officer of British Airways (BAY.L: ) has
signalled an appetite for more merger deals to extend the
airline’s reach into the emerging South American and African
markets. After a tumultuous year, involving industrial action
and record losses, Willie Walsh said that once his merger with
Spain’s Iberia (IBLA.MC: ) is signed off later this month, BA will
be seeking a new partner to help cultivate its expansion
ambitions in Latin America.

MORRISONS TO CHALLENGE ONLINE RIVALS

Supermarket chain WM Morrison (MRW.L: ) has unveiled plans to
enter the five billion-pound-a-year online grocery market, which
is dominated by rivals Tesco (TSCO.L: ) and Asda (WMT.N: ). Newly
appointed chief executive Dalton Philips will outline his plans
including the launch of Internet trials in several stores on
Thursday, in his first significant presentation to the City
since he arrived in March. However, Philips is not expected to
announce any major capital expenditure before his full update to
the City in March 2011.

DANA PINS HOPES ON DRILLING RESULTS

Aberdeen oil firm Dana Petroleum (DNX.L: ) is hoping to force
an improved offer from Korea National Oil Corporation, which has
tabled a 1.87 billion pound hostile bid, when it reveals its
defence documents this week. Dana is hoping that its 25 percent
stake in the Anne Marie well, off the Faroe Islands, and its
preliminary drilling results, with predicted reserves of 300
million barrels of oil, will persuade KNOC to make a more
generous offer. However, KNOC has said it has no intentions to
increase its 1800 pence-a-share offer, unless it is rivalled. So
far KNOC has secured support for its deal by 50 percent of
shareholders and is anticipated to purchase its planned
controlling stake as soon as Dana releases its defence document.

The Sunday Times

BP READIES 40 BILLION DOLLAR SALE

Oil major BP (BP.L: ) has announced that it will be auctioning
off its 20 billion dollar holding in America’s biggest oil
field, Prudhoe Bay, as part of a strategic move to finance the
burgeoning costs associated with the Gulf of Mexico spill. The
sale announcement comes ahead of the publication of BP’s
internal investigation into the gulf drilling incident, which
will determine the firm’s legal culpability and the size of
subsequent claims. So far clean-up costs in the Gulf of Mexico
have risen to eight billion dollars, prompting BP to increase
its asset disposal to 40 billion dollars.

ANGLIAN OPENS WINDOW TO SALE

Home improvements firm Anglian Windows has appointed
accountants KPMG to manage the auction of the business, which
analysts say could be valued at as much as 140 million pounds. A
sell-off would mark the second time that the business has
changed hands in two years, after it was acquired by its lenders
when it failed to meet its financial obligations. Already
Anglian, which is expected to be on track to deliver earnings of
20 million pounds in 2010, is thought to have attracted interest
by numerous rival companies and private equity investors.

FTSE 100 CHAIRMEN HEAD FOR EXIT

Sir John Bond and Sir John Parker, the chairmen of mobile
phone group Vodafone (VOD.L: ) and utility group National Grid
(NG.L: ) respectively, are to step down. They have been part of
the corporate landscape for three decades and the search for
their replacements comes amid concerns about the lack of
high-quality directors keen to run public companies. Sir Stuart
Rose said he would not take on any role with another public
company due to the criticism he received at Marks & Spencer
(MKS.L: ).

The Sunday Telegraph

HOUSE OF FRASER TO BRING BACK ICONIC BIBA

House of Fraser, the department store retailer, has posted
strong like-for-like sales for the six months to the end of
July, as sales increased by 8.4 percent. The company is set to
relaunch the 1960s Biba clothing and homeware brand, which it
purchased last November, as its own Linea and Label Lab house
brands witnessed a sales increase of 62 percent over the same
period, with online sales increasing by 150 percent. Stephanie
Chen, director for womenswear and accessories, said the retailer
was targeting “style-conscious mothers and daughters shopping
simultaneously”.

NATHAN KIRSH TO CONTINUE BATTLE AGAINST MINERVA BOSSES

Nathan Kirsh, Minerva’s (MNR.L: ) largest shareholder, has set
out his desire to oust the chairman and chief executive of the
property developer ahead of this week’s emergency shareholder
meeting. Despite a failed takeover bid last year, Kirsh said he
would not be put off by a “No” vote and that “if we don’t win it
next week, we’ll win it in six months times”. Speaking of his
intentions for the company, Kirsh said he would consider
splitting the company in two, turning one half into a
real-estate investment trust. Shares in Minerva closed last week
at 87.25 pence.

SUNDAY QUESTOR

Kenmare Resources (JEV.I: ) (Buy)

Serco (SRP.L: ) (Hold)

The Independent on Sunday

CHINA FUND PUSHES FOR WALKIE-TALKIE STAKE

Land Securities (LAND.L: ), Britain’s largest property
developer, is considering selling a stake in its tallest
skyscraper in London to China’s biggest sovereign wealth fund.
The 500 foot tower, nicknamed Walkie-Talkie due to its top heavy
design, will cost an estimated 300 million pounds and is due for
completion in 2014. China Investment Corp (Read more about U.S. companies investment into China)oration, which has 200
billion dollars in funds, opened negotiations for an equity
stake of 25 percent. Land Securities began talks in June with
Canary Wharf Group to share the cost of development, after the
project was stalled in 2008 due to the collapse of the property
market. If a partnership is agreed, Land Securities or Canary
Wharf would have to become a minority investor.

CABLE AND WIRELESS WORLDWIDE IN SINGTEL’S SIGHTS

The most valuable company on the Hong Kong stock exchange is
in the early stages of tabling a bid for Cable & Wireless
Worldwide (CWP.L: ). SingTel has hired bankers in Asia and Europe
to discuss the takeover of the UK company. The estimated price
would cost the state-backed business more than 1.8 billion
pounds but would be considered a good move by SingTel’s chief
executive, one of Asia’s most high-profile businesswomen, Chua
Sock Koong. Shares in the Bracknell-based company were given a
boost by the news on Friday, as there have been concerns that it
is on the brink of falling out of the FTSE 100.

FITNESS FIRST TONES UP ACCOUNTS

Fitness First, the chain of gym’s owned by BC Partners, has
given an indication that it is preparing for flotation by
adopting international financial reporting standards. Deloitte,
the company’s auditor, will begin standardising results for the
year ending October 2010 for its leases in 20 countries. An
industry source said: “There are 550 gyms, so that will mean 550
calculations on 550 leases.” Although there have been rumours
that BC Partners was considering an outright sale of the
business which is plagued by a 550 million pound debt, it is
understood that it is still keen to list in Asia in 2011 or
2012. The business has suffered from a fall in customers.

The Observer

WATERSTONE’S FOUNDER POISED TO BUY BACK BOOK CHAIN

The founder of Waterstone’s is considering buying back the
book chain from HMV (HMV.L: ). Tim Waterstone is keeping an eye on
developments at the chain where sales have plunged. Last
Christmas, HMV revealed like-for-like sales at Waterstone’s fell
nearly nine percent during a time viewed as a peak trading
period. HMV’s chief executive Simon Fox will update the City
this week as rebel shareholders push for a sale. They are
prepared to wait until after the Christmas trading period to
make a final decision. Analysts said Waterstone’s value is not
reflected in HMV’s share price. HMV closed on Friday at 59
pence, valuing the group at 255 million pounds.

UNITE ANGER AT ALLEGED BA SURVEILLANCE OF CABIN CREW

British Airways (BAY.L: ) faces a threat of fresh strike
action after the union Unite said it is considering a new ballot
over alleged anti-union activities. The new developments come
amid allegations that two BA cabin crew members were subjected
to surveillance at their homes. It is also alleged that shop
stewards were prevented from representing employees. The
allegations of surveillance centre on BA’s security department,
Asset Protection, where the crew members are said to have
photographic evidence supporting their claims. While BA declined
to comment on the allegations, Unite said the airline had gone
from violating worker’s rights to violating human rights.

Prepared for Reuters by Durrants

PRESS DIGEST – British business – Sept 5