BUSINESS WITH PERSONALITY
GREEN PARTY PULLS OUT
Issue 1,306 Monday 24 January 2011
SPLITS WIDEN ON
BANKING REFORM
BANKING
▲
BY JULIET SAMUEL
SPLITS emerged over the direction of
UK banking reform yesterday, as
deputy leader of the coalition Nick
Clegg expressed support for a break-up
of British banks even as his own gov-
ernment’s Independent Commission
on Banking (ICB) came out against a
radical break-up plan.
The divisions throw into doubt the
implementation of the ICB’s recom-
mendations, which will be subject to
government approval when they are
published in September.
While Chancellor George Osborne
welcomed a speech by ICB chair Sir
John Vickers on Saturday, Clegg
ignored Vickers’ warning to avoid
inflammatory rhetoric.
He said that banks had been “an
oversized liability for the British econo-
my” and that regulation must “hive
off or insulate very high-risk, over-
leveraged banking activities from low-
risk, high street retail banking”.
His comments pre-empt the ICB’s
report, with Vickers having ruled out
the most radical break-up plans only a
day earlier as inflicting “considerable
economic cost”.
“The popular ‘utility/casino’ distinc-
tion between types of banking activity
seems more catchy than helpful,”
Vickers said.
But Clegg shrugged off the warning,
saying that previous UK governments
FTSE 100 ▲5,896.25 +28.34 DOW ▲11,871.84 +49.04
10 Banks Compete to Provide You with Tight Spreads
No Re-Quotes No Dealer Intervention No Conflict of Interest Between Broker and Trader
FOREX TRADING INVOLVES SIGNIFICANT RISK OF LOSS.
OF IRISH GOVERNMENT
END OF LINE FOR COWEN
BBA chief executive Angela Knight, deputy PM Nick Clegg and ICB chair Sir Jon Vickers.
had “allowed the housing market to
let rip, to become a casino”.
Clegg’s language was slammed by
Angela Knight, chief executive of the
British Bankers’ Association, who told
CityA.M: “We don’t have a casino bank-
ing system in the UK. All politicians
and others need to be very careful
about how they’re portraying our
banks.”
She also said that Clegg risked
“using easy words that may get a
NASDAQ ▼2,689.54 -14.75
GEEK SPEAK
www.cityam.com
round of applause on day one but will
be to the detriment of everyone there-
after.”
Another senior banking source said:
“It is populist to cry for the break-up
for the banks but we all need to realise
there are substantial costs for cus-
tomers and shareholders.”
Vickers took a moderate stance in
his speech, but signalled that the ICB
is looking at ways to reduce retail cus-
tomers’ exposure to wholesale banks,
£/$ 1.60 ▲+0.01 £/¤ 1.18 unc
P3
Pictures: Micha Theiner/ CITY A.M , PA
potentially through different capital
requirements. However, he rejected
separating the ownership of invest-
ment and high street banks.
The ICB’s report will not be binding,
meaning that Osborne will have to
negotiate with his Lib Dem allies over
its implementation. Clegg’s attack
comes as industry-wide talks to
improve banks’ image stalled.
MORE: VICKERS’ SPEECH P4-5;
MERLIN TALKS STALL: P12
¤/$ 1.36 unc
ODL Markets
powered by
www.odlmarkets.com
STEVE DINNEEN
TALKS GADGETS
IN A NEW WEEKLY
COLUMN P24
FREE
Goldman’s
UK tax bill
tops £2bn
▲
EXCLUSIVE
BY JULIET SAMUEL
THE UK treasury made more than
£2.29bn from Goldman Sachs last year,
City A.M. can reveal.
Goldman does not publish a break-
down of tax costs by region, but it is
understood that the amount repre-
sents a 14.5 per cent rise in its tax costs
compared to 2009, despite a 35 per
cent fall in global pre-tax profits.
The sum equates to 4.3 per cent of
the £53bn paid in total UK taxes by the
entire financial services industry.
The figure includes corporation tax,
national insurance, VAT, income tax
paid by employers on behalf of employ-
ees and the effect of the one-off bonus
tax last year, which accounted for
$465m (£290m) of the cost.
The tax bill suggests pay of £382,000
per head for its 6,000 London-based
staff – far more than its 2010 average
pay per global employee of £286,000.
However, Goldman partners reduced
their donations to charity in 2010, giv-
ing $320m (£200m) globally versus
$500m (£312m) in 2009.
The revelation of the bank’s rising
tax costs will raise further worries that
the UK risks pricing itself out of the
financial services market with increas-
ingly punitive charges for banks that
want to do business here.
Conservative MEP for London Syed
Kamall said: “While it is tempting for
politicians to ask banks to pay higher
taxes after some were bailed out with
taxpayers money, we need to think
through the consequences of tinker-
ing with taxation too much.”
Certified Distribution
29/11/10 till 02/01/11 is 98,444
 2 News
Coalition rejecting its own medicine
EDITOR’S LETTER
ALLISTER HEATH
THIS week will be critical for the coali-
tion’s economic policies, in terms of
perceptions even if not in reality.
Despite their tentative nature,
Tuesday’s fourth-quarter GDP figures
will take centre-stage in Westminster:
if they come in as expected, the coali-
tion will celebrate; if they are weak,
Labour’s Ed Balls will have a field day
trashing the government and
demanding a new round of Keynesian
pump-priming. Neither argument
would be fair – but that is politics.
The consensus view is for growth of
0.4 per cent but snow-related disrup-
7th Floor, Centurion House,
24 Monument Street, London, EC3R 8AJ
Tel: 020 7015 1200 Fax: 020 7283 5334
Email: news@cityam.com www.cityam.com
Editorial
Editor Allister Heath
Deputy Editor David Hellier
News Editor David Crow
Night Editor Katie Hope
Business Features Editor Marc Sidwell
Lifestyle Editor Zoe Strimpel
Sports Editor Frank Dalleres
Art Director Craig Gaymer
Pictures Alex Ridley
Commercial
Sales Director Jeremy Slattery
Commercial Director Harry Owen
Head of Distribution Nick Owen
Distribution helpline
If you have any comments about the distribution
of City A.M. Please ring 0207 015 1230, or email
distribution@cityam.com
Editorial Statement
This newspaper adheres to the system of
self-regulation overseen by the Press Complaints
Commission. The PCC takes complaints about the
editorial content of publications under the Editor’s
Code of Practice, a copy of which can be found at
www.pcc.org.uk
Printed by Newsfax International,
Beam Reach 5 Business Park,
Marsh Way, Rainham, Essex, RM13 8RS
WHAT THE OTHER PAPERS SAY THIS MORNING
AUDITORS SEEK TO EASE FEARS
The four biggest auditors have denied
that their dominance of the market
for large companies had created a sys-
temic risk akin to that posed by the
leading banks. Deloitte, Ernst &
Young, KPMG and PwC have told the
European Commission that they are
willing to help draw up contingency
plans addressing the possible scenario
of a collapse of parts of their business.
HALF OF VAT PENALTIES OVERTURNED
More than half of value added tax
penalties are being overturned on
appeal, according to statistics that
draw attention to a new internal
review procedure that makes it easier
to query Revenue & Customs (HMRC)
decisions. The figures may fuel con-
cern that HMRC is issuing penalties
too readily, although they will also
boost confidence in the fairness of the
review procedure introduced in 2009.
tion in December – an embarrassingly
severe problem for a supposedly
advanced economy – means that this
figure could easier be lower.
Frustratingly, this one-off chaos
means that this week’s figures will be
too distorted for anybody to be able to
draw sensible conclusions from them.
Detailed predictions of Tuesday’s
figures are useless: nobody knows
what the ONS will put them at – espe-
cially given that these statistics are fre-
quently revised later. But while as
recently as two weeks ago, virtually all
the data for the UK economy had been
positive, denoting decent growth, this
is no longer the case. Manufacturing
is still booming but services slumped
in December. Construction is slowing.
The employment figures also suggest
that after a strong rebound between
February and October, the UK econo-
my has slowed.
One reason why it is so hard to
understand what is happening is the
sloppy reporting of easily verifiable
facts. I’m getting sick at the number of
Police look at
Brown claims
MEDIA
▲
BY STEVE DINNEEN
THE News of the World phone-hack-
ing scandal continued to gather pace
yesterday, with Gordon Brown asking
police to investigate whether he was
targeted. The former Prime Minister
expressed concerns his messages may
have been intercepted between 2005
and 2007, when he was chancellor.
Energy and climate change secre-
tary Chris Huhne ramped up pressure
on News Corp – owner of the News of
the World – casting doubt on the
newspaper’s defence that a single
“rogue reporter” was responsible for
the hacking. He told the BBC: “It
seemed to me clear that the number
of people that were being hacked
clearly was not consistent with it
being one rogue reporter who hap-
pened to be the royal correspondent.”
OFFICE SPACE DEMAND SOARS
Demand for office space in London
from financial services groups last
year outpaced levels in the boom peri-
od before the credit crunch, a sign of
returning confidence among banks
gearing up for expansion. Financial
sector take-up of office space in cen-
tral London totalled 6.4m square feet
in 2010, compared with 5.3m in 2006
and 4.5m in 2007, according to Knight
Frank.
PAMPLONA DEAL EDGES CLOSER
Pamplona Capital Management, the
Russian-backed private equity firm,
has inched towards control of KCA
Deutag, after securing the backing of
junior lenders for its proposed
restructuring of the Aberdeen-based
oil services group. The firm has
offered the company and its lenders
about $550m (£344m) of new funds,
one of the biggest cheques written for
a takeover of a European company
through a debt restructuring, accord-
ing to people familiar with the terms.
times people are claiming that “retail-
ers suffered their worst December on
record.” Had that been the case, sales
would have collapsed by 99 per cent,
dropping back to the level seen in the
1930s when supermarkets didn’t exist
and people spent a few shillings a
week. What actually happened is that
the growth rate for parts of the indus-
try was the worst in years – and there
was no overall change in the volume
of retail sales compared with
December 2009. Volumes fell 0.8 per
cent compared with November.
Volumes in the three months to
December was 0.4 per cent higher
than a year ago.
There is also an exaggerated view of
the public spending cuts to date.
Central government current expendi-
ture hit a record £53.8bn in
November, up 10.7 per cent year on
year, a huge increase. Public sector net
debt rose from £846bn in October to
£863.1bn in November. Every week,
billions more are still being added to
the national credit card.
The allegations finally toppled
David Cameron’s key aide Andy
Coulson over the weekend. The
Number 10 spin doctor quit, saying he
was no longer able to give “110 per
cent” to the job. Yesterday City sources
were questioning whether the scandal
could even affect News Corp’s bid for
Sky. One suggestion is that News Corp
could fall foul of “fit and proper” own-
ership rules if it is found it bought off
potential witnesses in a in a future
criminal prosecution. However, sources
close to media watchdog Ofcom told
City A.M. this scenario is “far fetched”.
Former Prime Minister
Gordon Brown has
emerged as a potential
target of News of the
World phone hacking
STORM OVER CENTRICA PROFITS
A surge in profits of as much as 25
per cent at the British Gas group
Centrica looks set to prompt a
Competition Commission investiga-
tion into Britain’s leading energy sup-
pliers. Only two years after its last
inquiry into the industry, Ofgem is in
the middle of a new investigation
into whether consumers facing high
energy bills are being ripped off by
electricity and gas providers.
TYCOON BUYS INTO ISRAELI MISSILE
ALERT SYSTEM
The property entrepreneur Vincent
Tchenguiz has taken a stake in an
Israeli defence technology company
as part of a much larger plan to create
a homeland security business. Mr
Tchenguiz’s Consensus Business
Group has invested more than
£500,000 in the high-technology com-
pany eVigilo.
The slowdown cannot have been
caused by massive spending cuts
when spending is still surging.
Bizarrely, the coalition is failing to fol-
low its own, OECD-inspired advice:
that the best way to reduce a deficit is
to ensure that three-quarters of the
reduction comes from cuts and only a
quarter from tax hikes. So far, all the
tightening is coming from tax hikes,
including Vat and April’s rise in
national insurance.
The good news is that the average
forecast is now for UK growth of 2 per
cent in 2011; some snow affected
spending might be transferred to
January. The global boom is accelerat-
ing. The bad news is that the coalition
is continuing to hammer private
firms with more red tape and tax –
and failing to follow its own policies
on spending. The markets won’t panic
about growth – but if they start to
worry again about the deficit, we will
be in real trouble.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
IAG becomes the first wholly owned foreign incorporated firm to trade as a FTSE100 firm
BA and Iberia fly into FTSE
M&A
▲
BY RICHARD PARTINGTON
THE COMPANY formed following the
merger of British Airways with Spanish
carrier Iberia will today become the
first wholly foreign incorporated firm
ever to trade on the London Stock
Exchange as a FTSE100 firm.
International Consolidated Airlines
Group (IAG) will fly into the FTSE100 as
one of the UK’s top companies, despite
its official status as a Spanish firm.
Overseas companies traditionally
HARRODS HITS £1BN IN SALES
Harrods has hit £1bn of annual sales
for the first time after a blowout
Christmas. The department store
cracked the milestone figure for the
year to the end of January after
tourists flocked to the West End in the
run up to Christmas. Michael Ward,
Harrod’s managing director, said:
“Reaching £1bn sales makes today one
of the most significant in the store’s
history.”
FUEL LUNACY COULD CAUSE STANDSTILL
The Government must address the
plight of Britain’s poor motorists,
writes Boris Johnson. He said: “If I
were the government, I would think
seriously about that fuel duty stabilis-
er, because when it costs more to fill
your tank than to fly to Rome, some-
thing is seriously wrong... The electric
revolution is happening, but it will
not be overnight.”
CITYA.M. 24 JANUARY 2011
NEWS | IN BRIEF
Balls begins his attack
Labour’s new shadow chancellor Ed
Balls wasted no time yesterday in get-
ting stuck in to his new portfolio, accus-
ing his opposite number George Osborne
of "cutting too far too fast". But the
combative economist faced plenty of
criticism, with deputy prime minister
Nick Clegg leading the offensive, brand-
ing him as the man in charge when City
bankers “were gorging themselves on
bonuses and lending irresponsibly.”
Balls called for a fresh £3.5bn tax on
bankers’ bonuses.
Fair fuel stabiliser considered
Transport secretary Philip Hammond said
the government is still considering a “fair
fuel stabiliser” – which reduces duty on
fuel at times of high prices to even out
prices at the pumps. His comments come
after the Federation of Small Businesses
warned a quarter of its members could be
forced to lay off staff because of fuel
costs. London mayor Boris Johnson yes-
terday wrote: “If I were the government,
I would think seriously about that fuel
duty stabiliser, because when it costs
more to fill your tank than to fly to Rome,
something is seriously wrong.”
Picture: PA
achieve a top flight London listing by
incorporating in accordance with UK
company law and by officially register-
ing as a business with Companies
House.
IAG however is incorporated under
Spanish law and pays taxes in Spain,
yet is headquartered in London and
will primarily list on the London Stock
Exchange.
BA and Iberia will retain their
brands as part of the $8bn (£4.9bn)
merger deal, and will have a combined
419 aircraft flying to 205 destinations.
VODAFONE-ESSAR SPAT INTENSIFIES
Vodafone Group said it continues to
believe that material information has
not been provided by Essar Group
regarding the merger of its listed
company with a privately held Essar
holding unit, which in turn holds an
indirect 11 per cent stake in the
British telecommunication firm’s
Indian unit.
LONE STAR RIDES TO AID OF JAPAN
BANK
US distressed-debt specialist Lone Star
Funds is in talks with other lenders to
take control of Japan's Tokyo Star
Bank for the second time. The Dallas-
based fund and other lenders are in
discussions with Japanese private-
equity fund Advantage Partners
regarding about 170 billion yen
(£1.29bn) worth of loans that it took
out to buy Tokyo Star, according to
people familiar with the matter.
CITYA.M. 24 JANUARY 2011 News 3

Hayward in talks to
Tony Hayward is
in preliminary
talks about joining
the new Glencore
board of directors

join Glencore board

after its possible
listing, just three
months after he
stood down from
the top job at BP

Picture: REUTERS
taking a non-executive role, accord-

▲
COMMODITIES
BY MARION DAKERS
FORMER BP chief executive Tony
Hayward is in early talks about join-
ing the board of commodities trader
Glencore as part of its planned initial
public offering, it emerged yesterday.
Hayward, who is a non-executive
director for Russian oil venture TNK-
BP, recently met with Glencore chief
executive Ivan Glassenberg to discuss
ing to reports yesterday.
Glencore is meeting with a number
of candidates to oversee the firm if it
floats either in London or Hong Kong
during the next year, one source told
City A.M.
The company declined to comment
on the report.
Glencore would have to reshuffle
its board if it floats to comply with
corporate governance rules.

Finance Bill
safe as Irish
coalition fails
▲

EUROZONE
BY ELIZABETH FOURNIER
IRELAND’S economy was once again
thrown into turmoil yesterday after-
noon, as the country’s minority Green
Party pulled out of its coalition with
Fianna Fáil, destroying the ruling
party’s majority and making an early
election likely.
But the Green Party made it clear
that passing the Finance Bill remained
its priority, and urged Prime Minister
Brian Cowen to accelerate the legisla-
tion so that it can be passed this week.
Speaking in Dublin, leader of the
Green Party John Gormley said that
his party’s “patience had reached an
end” with Fianna Fáil’s control of the
Irish Government, citing “continuing
doubts, the lack of communication
and the breakdown in trust,” as the
final straws that led to its withdrawal
from the coalition.
Without the Green’s support,
Fianna Fáil is left without a majority,
forcing Cowen to dissolve his govern-
ment and call a general election.
With Fianna Fáil opinion polls at an
all-time low, the opposition Fine Gael
and Labour parties are widely expect-
ed to form the country’s next coalition
government after an election. Both
parties have campaigned on possible
amendments to the Finance Bill,
which contains unpopular spending
cuts and tax increases to fulfill the
terms of Ireland’s EU/IMF bailout.
However, the Bill’s key terms are
unlikely to change, with the Labour
party vowing to withdraw its planned
motion of no confidence tomorrow if
the government can push the legisla-
tion through before Friday.
Despite the ultimatum, Cowen
admitted that meeting that deadline
was unlikely, saying it was “not possi-
ble to get it done in a week”.
And despite assurances that the
Finance Bill will be passed before the
election, analysts say Ireland is lucky
that EU support means it won’t have
to access Eurozone markets in the
weeks ahead, with sentiment likely to
have plummeted over the weekend.
“The markets may actually be mar-
ginally reassured that there is the
lending programme in place from the
EU and IMF – in the absence of that it
would be a very tall order for the
NTMA (Ireland’s debt agency) to go to
the bond markets,” said Austin
Hughes, chief economist at KBC Bank.

Inflation is no way to fix

the deficit: OBR chairman
poured cold water on the idea of fast-
▲

ECONOMICS
BY JENNY FORSYTH
HIGH inflation is not a cure for
Britain’s deficit woes, according to
Robert Chote, the chairman of the
office for Budget Responsibility (OBR).
In an interview with the Financial
Times, he also gave his opinion that
cutting petrol duties to counteract
soaring fuel prices would make pub-
lic finances “less stable rather than
more stable”.
Many believe higher inflation
boosts the public finances by increas-
ing tax revenues. However Chote
rising inflation automatically cutting
the deficit.
“There are numerous ways infla-
tion can affect the public finances,
some positive and some negative, so
we cannot say for sure whether high-
er inflation lowers or raises the pro-
jected deficit,” he said.
Chote, who recently moved to the
new role from his former job as direc-
tor of the Institute for Fiscal Studies,
said the OBR plans to start giving
monthly updates on public finances.
The body is now preparing the eco-
nomic forecast for the Budget.
 4 News
TIME LINE | INDEPENDENT COMMISSION ON BANKING
● 16 June 2010
Chancellor George Osborne announced
the commission’s creation under the
chairmanship of Sir John Vickers. Its
other members are: Clare Spottiswoode,
Martin Taylor, Bill Winters and Martin
Woolf.
● 9 July 2010
The commission holds the first of its
meetings, with its minutes published
regularly.
● 24 September 2010
The ICB publishes a consultation paper
and asks for submissions of evidence. It
highlights the commission’s priority as
producing regulations to promote finan-
cial stability and competition while not
overly discouraging lending and econom-
ic growth.
● November-December 2010
The commission goes on a “roadshow” of
public events to gauge popular opinion,
holding five meetings: two in London and
one each in Edinburgh, Cardiff and
Leeds. The panellists and participants
include representatives from the UK’s
major banks and small businesses. It also
holds meetings with banks and stays in
regular communication with them
through the period.
● 22 January 2011
In his first public speech as chair of the
commission, delivered at the London
Business School, Vickers outlines the
pros and cons of separating retail bank-
ing activities from wholesale and rules
CITYA.M. 24 JANUARY 2011
out mandating “narrow banks” that are
heavily restricted in their activities. He
also emphasises the other regulatory
changes taking place globally, such as
through Basel III and the European
Commission.
● April 2011
The commission is due to publish a pre-
liminary report outlining its thoughts so
far. It plans another roadshow of events
and will solicit further feedback from
banks after the paper’s publication.
● April 2011
The commission will publish its recom-
mendations. The final decision as to their
implementation lies with Chancellor
George Osborne and business secretary
Vince Cable.
CITYA.M. 24 JANUARY 2011 News 5

KEYPOINTS | SIR JOHN VICKERS’ SPEECH

● Scope of the inquiry
Vickers made clear that financial stability
will be just as important to the commission
as competitiveness, focusing particularly
on “structural reform”: whether or how to
separate retail and wholesale banking.
However, he was careful to place the ICB’s
work in the context of international regula-
tions on capital (particularly Basel III) and
the takeover of failing institutions (to be
addressed by the EU). And he ruled out
broader recommendations on perverse
incentives created by the tax system,
despite their effect on financial stability.
● “Narrow” banks
He ruled out the creation of “narrow
banks” with nothing but vanilla retail func-
tions as a solution to the “too big to fail”
problem, saying: “It is very doubtful that
the implicit government guarantee would
be confined to narrow banking.” He said
that lending would just move elsewhere.
● Retail versus wholesale customers
He said that retail and wholesale banking
require different policy approaches
because retail customers are a largely
domestic market and rely more on their
banks for vital services. Whereas whole-
sale customers operate internationally and
“generally have greater choice and capacity
to look after themselves”.
● Differing capital requirements
He suggested that one way of separating
retail and wholesale risks could be “to ring-
fence the retail banking activities of sys-
temically-important institutions” and
impose a specific capital requirement on
them. But he was sceptical about blunt
regulations to separate the two functions.
● Senior bondholder debt
Vickers was keen to pinpoint possible ways
of making sure that senior bondholders, as
well as equity-holders and junior bondhold-
ers, absorb losses when a bank fails. He dis-
cussed both convertible contingent bonds
(“co-cos”), which turn into equity if a bank’s
capital ratio falls too low, and bail-in bonds,
which can be turned into equity by regula-
tors if a bank has to be wound up, as possi-
ble solutions.

Members of the
Independent
Commission on
Banking
DAVOS 2011 26-30 JANUARY

Vickers rules
out break-up
ure on the basis that “retail cus-
▲

BANKING
BY JULIET SAMUEL
SIR John Vickers, chair of the
Independent Commission on
Banking (ICB), ruled out breaking up
the financial industry into “narrow
banks” on Saturday in his first official
speech since the commission was
convened.
But Vickers’ speech, which gave a
glimpse of the ICB’s thinking three
months before its preliminary report
is due out, did discuss how to “ring-
fence the retail banking activities of
systemically-important institutions”
from their wholesale activities.
Despite dismissing the idea of “nar-
row banks”, whereby banks with
retail deposits are largely banned
from lending, Vickers emphasised
that “the policy challenges for retail
and investment banking are some-
what different”. He analysed differ-
ent ways of insulating retail
consumers from a possible bank fail-
SIR JOHN VICKERS
tomers have no effective alternatives
to their banks for vital financial serv-
ices”.
The speech signalled that the ICB is
considering “forms of separation”
between retail and wholesale bank-
ing operations, including subsidiari-
sation, in which retail and
investment banks operate separately
but remain legally under the same
ownership.
Vickers also commented on the
problem of implied government guar-
antees for banks that are “too big to
fail”. “This distortion... should be neu-
tralised or contained,” he said,
adding: “Credible resolution would
DAILY COVERAGE OF THE WORLD ECONOMIC FORUM
seem to require at least some form of
separability (between retail and
BROUGHT TO YOU BY CITY A.M. AND AVIVA
wholesale).”
But he also sounded a warning on
“the unintended consequence” of
some current regulations, including
tax incentives that make debt a more
attractive funding option than equity.
FIND OUT
WHAT THE WORLD’S BUSINESS

CHAIR, ICB
SINCE leaving a two-year post at
Shell as a financial analyst, Sir John
Vickers had spent most of his career
in academia before moving into eco-
nomic policy-making.
He is a fellow of All Souls College,
Oxford and was an economics profes-
sor at the university for 12 years until
he went on leave to become the Bank
of England’s chief economist in 1998.
After two years at the BoE, he moved
to become director general of the
Office of Fair Trading and from 2007
to last year, he was president of the
LEADERS AND POLITICIANS
Royal Economic Society.
While head of the OFT, he oversaw an
investigation of charges by store card
providers and called for an inquiry
ARE TALKING ABOUT
into LSE’s proposed merger with
Euronext.
He has spent much of his career
See tomorrow’s paper for an exclusive preview
studying the economics of competi-
tion and regulation, writing extensive-
ly on patent law, price signalling and In association with
vertical markets.
He is now charged with designing the
basis of a new regulatory framework
for the entire UK banking industry.
Juliet Samuel
CITYA.M. 24 JANUARY 2011 News 7

Ireland must erase uncertainty over its banks

may have received a vote of confidence
from his fellow party members last
week, but over the weekend he
resigned from his leadership post.
What happens next, and who steps in
to lead Ireland through its recovery
phase will be crucial.
Cowen has been under increasing
CITY COMMENT pressure since seeking an EU/IMF
bailout of €85bn (£72.4bn) last year. It
LOUISA BOJESAN was recently revealed that he played
golf with the former chairman of
Cowen denied banking matters were
discussed during this meeting, it still
left a bad taste in the mouths of the
general public.
But after this weekend’s news, it is
no longer about Cowen’s unpopulari-
ty, nor is it about the dramatic drop in
Fianna Fail opinion polls. Instead, it is
about damage limitation.
Nobody expects the ruling party to
do well in the general election.
Brenda Kelly, an analyst from CMC
still wants to make senior bondholders
accept a larger portion of the debt.
However, this has been a no-go area, as
Ireland is so dependent on foreign
investment.
According to Kelly, the next round
of EU stress tests will be crucial, as we
get more clues about liquidity and
whether Ireland will need to use more
than the €10bn already earmarked for
the banks from the EU/IMF bailout.
The crucial issue is that uncertainty
be necessary. Allied Irish Bank passed
the last tests with flying colours – but
it still needed an injection of €3bn,
effectively nationalising the bank.
While Kelly thinks the current Irish
government’s four-year plan appears
to be working, she underlines the
growing problem of negative equity
that exists in the housing market – an
issue that also affects the banks. The
Irish housing market is now down 41
per cent from peak 2002 levels.

T
he next couple of weeks, ahead
of the upcoming Irish general
election, are going to be crucial
for Fianna Fail, the ruling Irish
party. Prime Minister Brian Cowen
Anglo Irish Bank just two months
before the bailout was announced.
With an expected taxpayer bill of
€34bn, Anglo Irish is the Irish bank
perceived to be the most toxic. While
Markets, says that had there been a
vote of no confidence ahead of the
bailout, things may have been differ-
ent. But the terms of the bailout are in
motion now, although the opposition
regarding the Irish banks is eliminat-
ed. We have seen an exodus of
investors over the last year; Bank of
Ireland may have to sell off parts of the
group, and debt restructuring could
One thing is sure: whoever becomes
the next Irish prime minister has a
humongous job ahead.
Louisa Bojesen is a co-anchor of CNBC’s
European Closing Bell.

Cocoa to rise
as Ivory Coast
halts exports
the Federation of Cocoa Commerce
▲

COMMODITIES
BY MARION DAKERS
THE PRICES of cocoa and coffee could
rise sharply this morning after the
president-elect of the world’s biggest
producer of the beans declared it had
suspended exports.
The president-elect of the Ivory
Coast, Alassane Outtara, yesterday
ordered exporters to suspend opera-
tions for a month from today in an
attempt to cut off funding from rival
Laurent Gbagbo, who the UN said lost
a presidential election in November.
The Ivory Coast produces nearly 40
per cent of the world’s cocoa accord-
ing to UN figures, and Outtara hopes
the economic fallout from an export
ban will pressure Gbabo to step down.
The price of cocoa has risen 13 per
cent since the Ivory Coast’s disputed
election, and stood at $3263 (£2,025)
per tonne last week, according to the
International Cocoa Organisation.
The price of cocoa hit a 33-year
high of £2,732 a tonne mid-way
through last year.
The world’s largest traders were
reportedly planning an emergency
conference call with industry body
yesterday to help clarify the trading
restrictions.
The FCC and European Cocoa
Association said in a joint statement
last night that the situation in the
Ivory Coast has “created a very testing
environment for the cocoa trade” and
that it is working with those in the
industry to resolve issues arising from
the suspension.
“Time, patience and a common
sense approach to the difficulties and
delays that may arise are required,
but most importantly, all those
whose interests are impacted should
remain calm in order that we sustain
no long term damage to Ivorian farm-
ing communities and the cocoa
industry,” the trade bodies said.
The European Union has tightened
its economic sanctions against the
Ivory Coast to try and unseat Gbabo,
while other West African states have
warned that they are prepared to use
force to oust Gbabo’s government.
African leaders have also asked
Outtara to name a new head of the
region’s central bank, in a further
attempt to remove Gbabo from
power.

Permira and Axa plan a

joint bid to buy Opodo
Opodo, Permira and Axa had been
▲

M&A
BY JENNY FORSYTH
PERMIRA and Axa Private Equity are
planning to make a joint €500m
(£425.5m) bid for Opodo tomorrow, as
they seek to compete against US inter-
net travel giants Expedia and Orbitz.
However the two private equity
groups are likely to face bidding com-
petition from their US rival Carlyle,
according to the Financial Times.
The newspaper added that people
familiar with the auction believe
Permira an Axa are favourites.
Before joining forces to bid for
competing head-to-head to acquire
mid-sized European internet travel
agencies.
Last year Axa outbid Permira to buy
Go Voyages. Conversely Permira beat
Axa in the fight to buy the Barcelona-
based online travel group eDreams.
But after teaming up, the two
groups reportedly plan to buy Opodo,
which is being sold by Amadeus IT
Holding, and combine it with
eDreams and Go Voyages to create a
European travel behemoth.
Opodo accounts for just four per
cent of Amadeus’ total revenue.
 8 News
Tax officials’ bonuses to be
curbed after bumper 2010
▲
TAXATION
BY RICHARD PARTINGTON
BONUSES received by tax officials will
be curbed in line with the rest of the
public sector, following revelations
that top HMRC staff received a
bumper £13m bonus payment
between them last year.
The Revenue paid out almost
£800,000 more on staff bonuses last
year than it did in 2009, despite a
blunder in the run up to Christmas
that saw more than a million people
receive new tax demands.
As many as 450,000 pensioners
were told to pay more tax at the end
of last year after HMRC made mis-
takes on their tax codes.
The payments to staff were made
under contracts agreed under the
previous government administration
and will now be curbed, as Whitehall
departments prepare to clip expendi-
ture.
Freedom of Information requests
BELGIUM PROTESTS LACK OF GOVERNMENT
found several government depart-
ments paid large bonuses to staff.
A spokesperson for HMRC said: “We
have said we will restrict perform-
ance related payments from 2011-12
and are conducting a review into pay
structures. A two-year public sector
pay freeze starts in 2011.
“The number of Senior Civil
Servants who will receive a bonus will
also be dramatically reduced in
future in line with commitments
made by the Prime Minister.”
Tens of thousands of Belgians took to the streets yesterday to shame political leaders who
have failed to form a government more than seven months after an election and left the
country at the mercy of financial markets. Organisers of the “Shame: no government,
great country” protest said up to 50,000 people had joined the march through Brussels.
Police put the figure at 34,000.
Portugal puts
faith in Silva
▲
EUROZONE
BY HARRY BANKS
PORTUGUESE President Anibal
Cavaco Silva won a second term in
an election yesterday, television exit
polls showed, a result that should
ensure short-term political stability
as the cash-strapped government
fights to avoid an international
financial bailout.
The country’s leading television
stations put Cavaco Silva’s share of
the vote at around 55 per cent com-
pared with about 19 per cent for
Manuel Alegre of the ruling
Socialists, his closest competitor in
a field of six.
Alegre conceded defeat minutes
later.
Cavaco Silva, of the centre-right
Social Democrats, is expected to bol-
ster Socialist Prime Minister Jose
Socrates’ drive to cut the budget
deficit through tough austerity
Greece says recovery is being set
back by debt restructuring talk
▲
EUROZONE
GREECE’S central banker said yester-
day that talk of debt restructuring is
hurting the country as it struggles to
exit the fiscal crisis that has shaken
the eurozone.
“I believe that even mere talk of
debt restructuring hurts the country,”
Bank of Greece governor George
Provopoulos told local Greek press.
He said the negative impact of a
CITYA.M. 24 JANUARY 2011
Picture: GETTY
measures and pull the the country
out of a debt crisis.
The President’s post is largely cer-
emonial but he does have the power
to dismiss the Prime Minister and
dissolve parliament.
Should Portugal have to follow
eurozone weaklings Greece and
Ireland and go the EU and
International Monetary Fund for a
rescue package, Cavaco could be
under pressure from his own party,
which is in opposition to the
Socialists, to do so.
But after casting his vote in a
chilly Lisbon, Cavaco Silva, a former
economics professor who was prime
minister from 1985 to 1995, said he
did not want to speculate about
that possibility.
“I am a president in favour of sta-
bility. I consider that it is very
important for Portugal to have
political stability to solve its prob-
lems,” he said.
debt restructuring would far exceed
the short-term pain caused by the aus-
terity measures Greece is implement-
ing.
“The political and economic impact
of debt restructuring would far exceed
the short-term pain of fiscal adjust-
ment. Debt restructuring would spark
an uncontrollable chain reaction
which would start a new, long-term
cycle of a lack of credibility for the
future of Greece’s economy,” he said.
CITYA.M. 24 JANUARY 2011
Candy brother buys
One Hyde Park flat
PROPERTY
▲
BY MARION DAKERS
THE DEVELOPERS of One Hyde Park
have tried to lead by example by
snapping up two of the luxury flats
in the complex in Knightsbridge, it
emerged yesterday.
Christian Candy, one half of prop-
erty firm Candy & Candy, has
bought a single-storey penthouse for
£31m, according to press reports
based on Land Registry documents
yesterday.
This would be over £100m less
than the asking price for the most
expensive apartments in the com-
plex.
Sheik Hamad Bin Jassim Bin Jaber
al-Thani, the Qatari Prime Minister
who helped fund the development
through his Guernsey-based Project
Grande company, bought a three-
storey penthouse flat in August.
But there has also been intense
speculation as to the identity of the
purchaser of the most expensive
unit, a £140m penthouse apartment.
Renault chief:
spy case is not
over technology
▲
AUTOMOTIVE
RENAULT chief executive Carlos
Ghosn has revealed that alleged
industrial espionage in the compa-
ny’s electric cars programme centred
on its business model rather than
technology.
Ghosn told a French newspaper the
legal investigation would take several
months to complete and that he was
“surprised and shocked” by the affair.
Three of the company’s executives
have been fired over the allegations,
which surfaced in August after the
firm received an anonymous letter.
The Capitalist in City A.M. was the
first to highlight the mystery of the
£140m penthouse owner last week
and queried whether the developers
may have purchased other apart-
ments.
Candy & Candy has not disclosed
the identity of the buyer.
The company maintained its
refusal to name the buyer yesterday,
citing a confidentiality agreement.
Candy & Candy said last week that
the penthouse was bought by an
anonymous party who came
through the One Hyde Park website.
While the developers have
announced that contracts have been
exchanged on 60 per cent of the 86
flats available, it is thought that just
two finalised sales have made it onto
the Land Registry to date – both of
them bought by the developers.
A director at Savills, one of the
agents tasked with marketing the
flats, told The Capitalist last week the
new owner of the most expensive
penthouse is not one of the develop-
ers.
Etihad mulls a bid
for Virgin Atlantic
TRANSPORT
THE head of Etihad Airways has writ-
ten to Virgin Atlantic to express “top
level interest” in taking over the air-
line, according to reports at the week-
end.
Sir Richard Branson’s airline hired
Deutsche Bank last year to look at
options for the company, which could
include a merger or takeover.
Etihad, which is based in Abu Dhabi
and is chaired by Sheikh Hamed bin
Zayed Al Nahyan, refused to confirm
reports in the Sunday Times.
“We have no comment other than
News 9
Simon Cowell, Arcadia boss Philip
Green and Formula One tycoon
Bernie Ecclestone were among 350
guests invited to the sumptous
launch party of the Knightsbridge
development last week.
The retail outlets on the ground
floor of the complex have been let to
carmaker McLaren, Rolex and Abu
Dhabi Islamic Bank.
The One Hyde Park scheme was
started in 2006 and cost close to
£1bn to develop.
A spokesper-
son for Candy &
Candy said the
identity and
amount paid for
each flat was
private as part
of a confiden-
tiality agree-
ment and
declined to
comment on
the Land
Registry public
records. The Candy brothers celebrate the launch Picture: REUTERS
Firms struggling to stay
afloat up by 20 per cent
▲
ECONOMY
more than £52.7bn.
THE number of UK companies strug- Companies reliant on government
that we talk regularly and frequently gling to stay solvent jumped 20 per contracts were hit hardest, with more
to many airlines and a range of other cent in the last quarter of 2010, data than 61,000 becoming seriously
businesses from all over the world shows today. indebted in the quarter, 24 per cent
about business issues and opportuni- Nearly 148,000 companies had more than in the third quarter.
ties,” said a spokesperson for Etihad. insolvent accounts, a court action The number of distressed compa-
Virgin said it continued to work against them or a wind-up petition nies was four per cent higher than in
with Deutsche Bank to assess growth filed by the end of 2010, up from the last three months of 2009, when
opportunities. “This study is at a very 123,361 in the third quarter, the Red 141,527 firms faced financial difficul-
early stage so there is no further com- Flag Alert analysis by turnaround spe- ties at the height of the recession.
ment to make at this time,” a cialist Begbies Traynor found. Begbies Traynor chairman Ric
spokesperson said in an e-mail. Companies in the “critical” stage of Traynor said the data showed compa-
Branson said recently that he might distress, which had been issued either nies “demonstrating real signs of dis-
sell his 51 per cent in the carrier. The county court judgments – lodged by tress.” “Trade creditors are losing
remaining 49 per cent is owned by creditors against insolvent companies patience with their debtors and in
Singapore Airlines. – or wind-up petitions, owed creditors need of collecting cash,” he said.
 The Capitalist
10
FACEBOOK:
A LITTLE
TOO SOCIAL
NETWORK?
YOU might think former Facebook presi-
dent Sean Parker, who described Justin
Timberlake’s portrayal of him in the
movie The Social Network as “a complete
fiction,” may have reason to be slightly
annoyed.
Trousersnake plays Parker as a
Machiavellian, cocaine snorting wise guy
who impresses a young Mark Zuckerberg
by dating a Victoria’s Secret model.
So is he bitter? Certainly not: “I kind of
wish my life were that cool,” he said.
The Social Network won three Golden
Globe awards last week – for best drama,
best director David Fincher and best
screenplay, by Aaron Sorkin – and is
tipped to sweep the board at the Oscars.
Parker is no stranger to controversy. He
is the co-founder of peer-to-peer music-
sharing service Napster, which was even-
tually shut down by US authorities after
being involved in a long-running battle
with the record industry over its apparent
advocacy of piracy.
So which aspects of the The Social
Network were fictionalised, wonders The
Capitalist. “Well,” he explains, “there are
no Victoria’s Secret models in Silicon
Valley.”
MONEY FOR OLD PAPER
The Capitalist has always wondered why so
many paper destruction lorries are seen
loitering in the Square Mile, and recent
figures explain why. Shred-It, the receipt
and paper destroyer, has seen its revenues
soar 18 per cent to £35m. It seems covering
up the trail left by City boys is a booming
business.
Apparently the surge in paper annihila-
tion is due to new powers set in place last
year that allow the Information
Commissioners Office (ICO) to fine data
criminals up to £500,000 fine for a “seri-
ous breach”. Hiring one of Shred-It’s 120
specially designed trucks to scrap your
paper rather than your balance sheet
seems an investment worth under-taking.
CITYA.M. 24 JANUARY 2011
EDITED BY
STEVE DINNEEN
GOT A STORY? EMAIL
thecapitalist@cityam.com
BILL OF THE WEEK
SIX thirsty city workers indulged in a
cocktail swilling session at
Odette’s Restaurant in Primrose Hill last
Thursday to celebrate bonus day. And
A Victoria’s Secret their big bonus splash-out also involved a
model (left), possibly bottle of Puligny Montrachet at £90 a
pop.
the one who never
dated former Ironically, the wine is known as “Scabby
Facebook president Hill” (Mont Rachaz) but we’re not sure
Sean Parker (right). this was reflected in their other indul-
gences, which included three classy bot-
Pictures: REUTERS/ PA tles of Dom Perignon at £540 in total
and a bargain-value bottle of plonk,
Gevrey Chambertin, at £88.
For the service charge of £113, venison
pie and battered fish was served
as blotting paper, alongside some plat-
ters of smoked salmon and chicken
wings.
It must have been hard to haul their
overloaded bodies from the comfy sofas
at 3.09pm, when the bill was paid,
amounting in total to £1,020.38.
CITYA.M. 24 JANUARY 2011
Greencore to
fight rival bid
▲
M&A
BY MARION DAKERS
GREENCORE is expected to sweeten
its merger deal with Northern Foods
this week in an attempt to best
Boparan’s £342m cash takeover offer.
Dublin-based Greencore is consid-
ering adding a cash sweetener on top
of its all-share merger with Northern,
according to people familiar with the
companies.
Northern’s board has dropped its
support for the Greencore deal and
instead recommends that sharehold-
ers support Boparan’s £342m cash
takeover offer, made late on Friday
after the Takeover Panel extended its
5pm deadline.
Greencore will say in a statement
to the market this morning that its
board continues to support the
Northern merger as a “compelling
opportunity” and will make a fur-
ther announcement in due course.
While Northern and Greencore
investors are still due to vote on the
merger on 31 January, it is likely that
the shareholder meetings will be
cancelled following Boparan’s inter-
vention.
GREENCORE
ADVISERS
The Irish food group hired an army of
advisers to work on its merger with
Northern, first announced in
November, including Barclays Capital,
Investec, Slaughter & May and public
relations group Powerscourt.
Barclays Capital is acting as finan-
cial adviser, joint broker and joint
sponsor, with Mark Todd and Jon
Bathard-Smith heading the team.
Joint broker Investec has worked
with Greencore for a number of years,
with head of investment banking
News 11
Meanwhile, Northern will send let-
ters to its shareholders this week to
stress the benefits of Boparan’s bid,
which at 73p per share represents a
61.3 per cent premium on Northern’s
closing price before the bid interest
was revealed.
The bid also has a premium of 52
per cent to the value of Greencore’s
all-share bid, which offered Northern
Foods shareholders 0.4479 of a
Greencore share for each Northern
AN EDUCATION IN RISK.
AN EDUCATION IN RISK.
Foods share they owned and was
worth 48.2p per share on Friday.
Analysts had said Boparan would
THE DIFFERENCE BETWEEN
need to offer a significant premium
to improve on the cost synergies
THE DIFFERENCE BETWEEN
promised by Greencore.
Boparan struck a deal with
BONUS & BANKRUPT
Northern pension trustees to pay
more than £15m a year to help
BONUS & BANKRUPT
shrink its £142m pensions deficit.
The pensions shortfall had been
seen as a stumbling block for rival
bidders after Greencore pledged to
pay down the deficit.
Greencore’s team of bankers –
Barclays Capital, Investec, IBI and
Goodbody Stockbrokers – are exam-
ining funding options for a better
merger plan.
David Currie still heavily involved. Understanding risk. It’s the difference between
Leading the Northern offer team is
managing director Chris Baird, who
being prepared, and not. Between making
joined from Dresdner Kleinwort in better decisions, and not. That’s why GARP’s
2009.
IBI Corporate Finance and FRM® and ERP ® professional designations,
Goodbody Stockbrokers, both based in education, and training are the overwhelming
Ireland, are acting as joint sponsor
and joint broker respectively. choice of individuals and institutions. Our
Magic circle firm Slaughter & May 150,000 members can be found in corporations
is advising on the legal side, with part-
ners John Panichola and Jonathan and financial services firms, governmental
Marks leading a six-strong team. bodies, and academic institutions around the
Powerscourt has worked with
Greencore since 2006, and counts BP, world. Start making better decisions now.
Aer Lingus and Independent News & Visit GARP.org/bonus to learn more.
Media among its clients.
The firm was set up by former
Sunday Times business editor Rory
Godson in 2004.
Rothschild, Goldman Sachs and PR
agency Hudson Sandler are advising
Boparan on its surprising rival bid for
Northern Foods.
 12 News
Barclays may
overhaul its
remuneration
BANKING
▲
BY STEVE DINNEEN
BARCLAYS could completely overhaul
the way it remunerates its top staff
next month.
Bob Diamond is considering paying
a portion of bonus payments for his
top 1,000 staff in contingent convert-
ible bonds – known as Cocos.
Cocos are a more politically accept-
able form of remuneration as they
convert from debt to equity if a bank
runs into trouble, therefore becoming
relatively worthless, unlike debt which
is likely to be repaid.
The bank told City A.M. no decisions
have been made on bonuses yet. The
bank will report its results on 15
February and bonuses will be
announced after that.
Diamond will also announce a
strategic review that will target
underperforming parts of the busi-
ness and could lead to significant job
losses.
Meanwhile, an accord between the
government and UK banks on lend-
ing and pay stalled again yesterday,
with an agreement now not expected
until next month.
The talks – dubbed project Merlin –
aim to secure assurances that banks
will lend almost £200bn to small busi-
CITYA.M. 24 JANUARY 2011
Davos ready
for a deluge
of bankers
▲
BANKING
BY JULIET SAMUEL
FINANCIAL services firms are set to
make a strong reappearance at the
World Economic Forum in Davos this
nesses and pledge to be more trans- week. Guests at the forum will
parent over pay. In exchange the gov- include Barclays’ Bob Diamond, JP
ernment will offer to end “banker Morgan’s Jamie Dimon, Deutsche
bashing” by ministers and guarantee Bank’s Josef Ackermann, HSBC’s
there will be no further crackdown Stuart Gulliver and outgoing Lloyds
on bonuses. chief executive Eric Daniels among
However, banks are understood to others.
be hesitant, with lending commit- The strong presence of banking
ments likely to be agreed at far below executives comes during a year that
the number being discussed. the organisers say should move the
Santander has already pulled out world “from risk to opportunity”. But
of the talks, instead opting to deal the theme of this year’s event,
directly with the Treasury, and City “shared norms for a new reality” has
A.M. understands Barclays is unhap- left some observers scratching their
py with tough new rules being pro- heads. The programme says: “The
posed about disclosure of staff ‘new reality’ is a world with manifold
remuneration. power centres, characterized by a
Banks are also understood to have high degree of volatility and the
clashed with the government about entrance [and exit] of players in the
commitments to the so-called “Big global race for competitiveness.”
Society Bank,” which would provide It promises that attendees will
lending facilities to charities and vol- gain “real insight” into the issue.
untary organisations. Despite the optimism, however,
Cameron had hoped to secure lend- the forum’s chair Klaus Schwab said
ing of more than £1bn but is unlikely last week that the world is suffering
to achieve anywhere near this sum. from “global burnout syndrome”
that makes it too weak to tackle the
Chancellor George myriad threats of economic uncer-
tainty and political risk.
Osborne is unlikely to “We have to be careful that this cri-
achieve the initial sis does not become a social crisis --
target of £200bn in which it has in some countries,” the
new lending German business studies professor
Bob Diamond is considering radical new payment plans Picture: GETTY told a media conference.
CITYA.M. 24 JANUARY 2011
ECONOMISTS’ VIEWS: WHAT DO YOU EXPECT FROM FOURTH-QUARTER GDP?
GEORGE BUCKLEY |
DEUTSCHE BANK
“ We expect the head-
line rate to be 0.6 per cent quar-
ter on quarter, but there are
downside risks. PMI surveys
weakened in December, but on
average the whole economy
PMI is around the same in quar-
ter four as it was in quarter
three. Overall for the year it
looks like growth was around 1.7
” ”
per cent. The recovery is less
than half way through.
Growth to slip
after record
winter freeze
▲
UK ECONOMY
BY JULIAN HARRIS AND ALISON LOCK
THE coldest winter in 100 years may
have contributed to a slowdown in
economic growth in the three
months to December, economists
said ahead of official GDP figures
released tomorrow.
Experts have forecast an average 0.4
per cent GDP growth for the quarter,
down from 0.7 per cent in the previ-
ous quarter.
Heavy winter snow caused shop-
pers to stay at home, hurting retailers
in the run up to the busy Christmas
period.
December’s retail sales figures,
published on Friday, showed sales vol-
umes frozen at December 2009’s level
as people bought less food and fuel.
The weather also affected supply
chains, and kept staff away from the
workplace.
Some forecasters expect growth to
slump to as low as 0.2 per cent, after
disappointing results for the service
sector – the largest sector in the UK,
which contributes more than 70 per
cent to GDP.
A purchasing managers’ survey of
the service sector contracted in
Inflation expectations surge to
highest ever level, poll reveals
▲
UK ECONOMY
INFLATION expectations have soared
to a record high this month, as rising
prices add to the squeeze on house-
hold spending, a survey said today.
With 89 per cent of respondents
expecting the cost of their purchases
to rise this year, the Markit household
finance index dropped to its lowest
level since April 2009.
“The recent VAT increase, higher
inflation and squeezed incomes
mean that households are once again
running just to stand still,” said Tim
Moore, senior economist at Markit.
Over one third of households
reported a recent deterioration in
News 13
You worked hard
for your money
You shouldn’t have to
Interviews by Julian Harris work even harder to get
the best exchange rates
IAN STEWART | PETER SPENCER |
DELOITTE ERNST AND YOUNG ITEM
CLUB
“ Slower growth in con-
struction and service output,
exacerbated by bad weather, is
likely to see growth slow to 0.5
per cent after pretty strong
growth in the previous quarters.
“ Growth should come
in around 0.4 per cent, but for
2011 we are above forecast,
expecting a 2.3 per cent expan-
sion. On the optimistic side,
business is buoyant and surveys 020 7801 9080
That said, manufacturing looks in are confident. I expect trade to
start making a positive contri- worldfirst.com
great shape. GDP data are chop-
py and prone to revision. There bution to GDP. Exports to
will be bumps along the way, but emerging “BRIC” economies
”
we think this will be a sustained are still low but are growing
recovery. like the clappers.
December, reinforcing expectations
that it will drag overall economic per-
formance lower.
Others expect more: the British
Chambers of Commerce has forecast
0.6 per cent growth, while think tank
the National Institute of Economic
and Social Research said output grew
0.5 per cent in the quarter.
A resurgence in UK manufacturing,
led by a weaker pound and strength-
ening export orders from emerging
markets, is not expected to stave off
the slowdown.
Keith Bowman of Hargreaves
Lansdowne said industry growth
would be “counterbalanced by con-
sumer hesitancy ahead of expected
government spending cuts, which
commence in earnest during 2011.”
The UK grew 0.7 per cent in the
third quarter of last year and 1.1 per
cent in the second quarter, but the
contribution of a boost in construc-
tion is not expected to continue into
the fourth quarter, partly due to a fall
in government sector spending.
“Construction activity had clearly
slowed appreciably even before being
hit markedly by December’s severe
weather,” said Howard Archer, chief
economist at IHS Global Insight.
their finances, while almost half of
mortgage holders reported a negative
outlook for their finances.
Mortgage holders may be wary of
impending interest rate hikes, the
report said, as inflation stubbornly
climbs upwards.
And with interest rates at a histori-
cal low, savings continued to fall, as
households “sought to offset a fall in
employment income,” Markit said.
Consumer price index (CPI) infla-
tion hit 3.7 per cent in December, offi-
cial data revealed last week.
There was more worrying news for
the high street, as over half those sur-
veyed indicated a fall in their willing-
ness to make major purchases.
 14 News CITYA.M. 24 JANUARY 2011

Oberthur and Bain

mull De La Rue bid
some of the financing to allow problems at one of its paper facto-

▲
M&A
BY JULIET SAMUEL
OBERTHUR Technologies, the
French group eyeing British ban-
knote printer De La Rue, has joined
forces with private equity firm
Bain Capital to lift its bid.
However, Bain will only support
the deal if it gains approval from
De La Rue’s board, sources said.
De La Rue last month rejected a
takeover approach from Oberthur
worth £895m, or 905 pence per
share, calling it “highly oppor-
tunistic”.
Bain is now willing to provide
Oberthur to raise the offer if
backed by De La Rue.
A weekend report said Oberthur
would make a new bid of around
950 pence.
The two firms have clashed since
Oberthur made its offer, in particu-
lar over the nature of De La Rue’s
relationship with its key customer,
The Reserve Bank of India.
A source familiar with the situa-
tion said earlier this month that
De La Rue would not be awarded
new contracts to supply the
Reserve Bank of India in the imme-
diate future, following production
ries.
A spokeswoman for De La Rue
said the company would not com-
ment on relationships with cus-
tomers because of confidentiality
agreements that are in place.
However, De La Rue stated that
orders taken since July 2010 were
comparable with those won in the
same period the previous year.
The UK’s Takeover Panel said
Oberthur must announce a firm
intention to bid for De La Rue by 7
February or walk away.
Last night an Oberthur
spokesman refused to comment.

GOOGLE’S GOLDEN GOODBYE

Google will give a
$100m (£62.5m)
equity award to Eric
Schmidt (right) as
he hands over the
chief executive offi-
cer job to co-founder
Larry Page (left),
and takes on the
role of executive
chairman. The
award will include
stock units and
options and will vest
over four years. The
news follows the dis-
closure that Google
reported earnings
and revenue above
expectations.

@
Picture: REUTERS

@ MORE NEWS
NEWS | IN BRIEF
Worldwide consumer squeeze
Consumers in most countries globally
look set to keep a tight grip on spend-
ing in coming months as they worry
about job security and rising inflation,
ONLINE AT according to a Nielsen Company sur-
vey released yesterday. Almost half
www.cityam.com (45 per cent) of Americans foresee a
weak economic environment this year,
compared with 38 per cent of
Europeans and 19 per cent of con-
sumers in the Asia Pacific, the survey
revealed. Consumer confidence was
positive at the end of last year in only
14 out of 52 countries surveyed world-
wide. The Nielsen Global Consumer
Confidence Index's average score,
however, was unchanged from the
third quarter at 90, helped by sharp
jumps in confidence in Norway, Turkey
and Switzerland as well as the
Philippines. A reading below 100 sig-
nals pessimism about the economic
outlook.
CITYA.M. 24 JANUARY 2011
Serco walks
from bid for
US spy firm
M&A
▲
BY RICHARD PARTINGTON
TALKS of a $2bn (£1.2bn) bid by out-
sourcing giant Serco for US spy firm
SRA International were last night
downplayed by the company.
The contracting firm, which runs
many of Britain’s public services, had
reportedly considered a takeover bid
for SRA in a deal that would have pro-
pelled it to become one of the biggest
foreign companies providing services
to the United States government.
However, it said last night it was
“not in any discussions regarding any
major transaction at this time”.
The acquisition of SRA would have
been Serco’s most ambitious
takeover attempt to date. In 2008, it
first entered the American market
with a $524m takeover of US govern-
ment IT services provider SI
ANALYSIS l Serco Group
640 p
558.00
600 21 Jan
560
520
25 Oct 12 Nov 2 Dec 22 Dec
NEWS | IN BRIEF
British steel production boost
Steel production in the UK shot up by
24.7 per cent last year, manufacturers’
group EEF said today. Like on like pro-
duction soared to 9.4m tonnes in 2010
from 7.5m tonnes the previous year,
they announced. “The strong improve-
ment reflects the pick up in manufac-
turing activity experienced both in the
UK and in our principal European
BEST OF THE BROKERS
ANALYSIS l Associated British Foods
1,200
p
1,086.00
21 Jan
1,160
1,120
1,080
1,040
25 Oct 12 Nov 2 Dec 22 Dec
ASSOCIATED BRITISH FOODS
Deutsche Bank rates the consumer
group “sell” with a target price of 950p.
The broker has downgraded its earnings
per share forecast by two per cent
thanks to falling sugar yields after the
snow and margin pressure in some divi-
sions. It also warns that Primark’s sales
growth is continuing its slow-down.
International.
The Fairfax, Virginia-based defence-
consulting firm provides IT services to
the US military, intelligence agencies
and other clients, holding around
1,200 different contracts with the US
Federal Government.
The company’s founder, Dr Ernst
Volgenau, who set up the firm as the
Systems Research and Applications
Corporation in 1976, still retains
close to a 24 per cent stake of the
business.
Any sale of SRA will require Dr
Volegnau to agree a price, with
reports suggesting that the company
is looking for a valuation upwards of
12 times its earnings before interest,
taxes, depreciation and amortisation
(Ebitda) this year.
For the year ending September
2010, the company had $1.67bn of
revenue and $150m of Ebitda. The
firm paid off outstanding loans in
the last quarter of last year leaving it
with no debt on its balance sheet.
Amongst its expertise is cyber secu-
rity, a threat which world govern-
ment’s have become increasingly
concerned of.
A US government security report
predicted at the end of last year that
Federal investment in information
security would rise to $13.3bn by
2015, indicating the potential size of
14 Jan the market.
export markets,” said UK Steel direc-
tor Ian Roger. “Nevertheless produc-
tion remained well below pre-recession
levels,” he added.
Apollo bids for Sara Lee
A private equity group led by Apollo
Global Management has submitted a
takeover offer for Sara Lee, but an
expected rival offer has not yet been
ANALYSIS l Man Group
p
282.00
320
21 Jan
300
280
260
14 Jan 25 Oct 12 Nov 2 Dec 22 Dec 14 Jan
MAN GROUP
RBS reiterates its “sell” rating on the
fund manager with a raised target price
of 244p. The broker was disappointed
by Man Group’s quarterly fund flow fig-
ures, although funds under management
came in just ahead of expectations. RBS
has raised its earnings per share esti-
mate by four per cent for the full year.
To appear in Best of the Brokers email your research to notes@cityam.com
News 15
Investors
REISS ON THE RISE
beat tax by
using CFDs
▲
CAPITAL MARKETS
BY RICHARD PARTINGTON
HALF of all equities traded in the UK
last year were traded as contracts for
difference (CFD), as investors looked
to evade stamp duty and capital
gains tax.
A total of €1.3 trillion (£1.1 trillion)
worth of shares were traded through
CFDs, according to data compiled by
US research house Tabb Group.
CFD, a form of equity derivative
that allows investors to speculate on
share price movements without the
need for ownership of the underlying
shares, do not incur stamp duty or
capital gains tax act as an attractive
alternative to cash equity.
The new research found that 35
per cent of the €3.9 trillion
exchanged in equities in the UK last
year across all products could be writ-
ten off, due to reprints of already-
conducted trades artificially boosting
the figure, putting the true value of
executable shares at €2.5bn.
The Tabb research also found trad-
ing in dark pools was higher in the
UK than it was across Europe as a
whole last year.
It found trading in broker crossing
systems (BCS), electronic off-
exchange trading platforms, account-
ed for eight per cent of executible
liquity last year.
Europe-wide data provided by
Thomson Reuters showed that trad-
High street fashion retailer Reiss predicts earnings from its UK stores will have risen by ing in dark pools, including BCS
40 per cent in its current financial year ending this week. The brand, a favourite of Kate activity, ran at around four per cent
Middleton, forecast earnings before interest, taxation, depreciation and amortisation of overall market activity in
(EBITDA) from the UK outlets to be around £12.7m, up from £9.1m last year. December last year.
made by Brazilian beef processor JBS,
a source said over the weekend.
Details of the bid submitted by Apollo,
Bain Capital and TPG Capital were not
immediately available. Preliminary
bids, or indications of interest, had
been due on Friday, sources said. Sara
Lee and the private equity firms were
not immediately available to comment
on the deal.
ANALYSIS l Domino's Pizza UK & IRL
600 p
523.00
21 Jan
560
520
480
25 Oct 12 Nov 2 Dec 22 Dec 14 Jan
DOMINO’S PIZZA
Numis rates the pizza chain “buy” with a
target price of 675p. The broker expects
an orderly handover when chief execu-
tive Chris Moore steps down in 2012,
and predicts a very strong sales update
on 15 February with pre-tax profit
growth of around 27 per cent and under
£10m of debts.
 16 News CITYA.M. 24 JANUARY 2011

Keep a file of NEWS | IN BRIEF

M&A dealers beat the market
Deal-makers who brave the uncertain
market conditions to make multiple

rejected gifts, acquisitions are being rewarded, accord-

ing to research by Cass Business School
and Towers Watson. Groups that made
two or more acquisitions with a value
above $100m in the last quarter of
2010 outperformed the MSCI World

say advisers index by 4.9 per cent, and have beaten

the market by 3.3 per cent on average
during the last three years. M&A activi-
ty more than doubled in 2010, said the
researchers, with 688 deals compared
to 322 in 2009 - though Europe is lag-
ging behind the US and Asia.
LEGAL SERVICES ethics and compliance officer that
▲

BY ELIZABETH FOURNIER
UK companies should prepare for the
Bribery Act now by establishing a “no-
list” of hospitality gifts that have been
turned down, say City advisers.
Much has been made of what can be
accepted as corporate hospitality
under the Act’s new rules, but compa-
nies should pay more attention to
what its employees reject based on
internal standards – those that raise
suspicion regardless of size.
“If you’re flying someone to Sydney
for the Ashes and not going as well it’s
always going to look strange – the new
Act doesn’t change that,” said Daniel
Barton, a senior director at profession-
al services firm Alvarez & Marsal.
“Instead companies should focus on
establishing a list of gifts that have
been declined, to prove that adequate
procedures are in place internally to
catch bribery.”
It’s also crucial that there is a clear
chain of command in place for inter-
nal communications, with a central
staff can go to for advice.
This is particularly important as
there is no minimum price for a
bribe – anything with improper intent
is included regardless of value.
Though extra guidance on the Act is
expected from the Ministry of Justice
before the end of January, companies
should not expect this to be dogmatic.
“Companies waiting for guidance
rather than acting now are wasting
their time,” said Barton. “It’s likely to
be pointers rather than a template.”
This is particularly important in
relation to facilitation payments.
Already illegal within the UK, the new
Act will have an extraterritorial scope
that will apply to subsidiaries based in
foreign jurisdictions.
Though the Ministry of Justice
could prove lenient during the first
weeks of the Act, it’s best to start now
to ensure continued supply.
“Companies should look at fading
out facilitation payments now so they
have a chance to explain to suppliers
before the Act comes in,” said Barton.
Companies must start keeping a list of hospitality gifts they turn down
FAST FACTS | UK BRIBERY ACT 2010
● The new UK Bribery Act was initally
planned for implementation at the beginning
of the year, but was delayed to allow for fur-
ther consultation. It will now be introduced
from 1 April 2011, with further guidance
expected from the Ministry of Justice before
the end of January.
● The Act contains a new liability clause for
directors that will mean subsidiaries and serv-
ice providers will have to be closely moni-
tored – regardless of how far down the chain
bribery occurs, the buck will stop at the top.
But Scotland has indicated it would scrap rules
that ban companies convicted of bribery from
Picture: REX
winning public contracts if the new liability
charges go ahead
● Minority stakeholders in joint ventures
could be hit by the new rules – a 49 per cent
control defence will no longer be acceptable,
with investigations focusing on the practical
and commercial running of a business rather
than the percentage held.
● The Serious Fraud Office is likely to encour-
age companies to be proactive in self-report-
ing and remediating – US companies used to
working under the Foreign Corrupt Practices
Act are likely to be a step ahead of their UK
couterparts in coming forward.
Riversdale Mining talks stall
Talks between Riversdale Mining and
China’s Wuhan Iron & Steel Corp over
acquiring a state in the Zambeze coal
project in Mozambique have been sus-
pended while a takeover bid by Rio Tinto
remains on the table, Riversdale said.
Riversdale is recommending its share-
holders accept Rio Tinto's offer, saying it
was unaware of any higher offers in the
works.
Swiss banker placed in custody
Former Swiss banker Rudolf Elmer, who
was found guilty of breaching bank
secrecy laws over his transfer of client
data to the online website Wikileaks,
has been remanded in custody, reports
said yesterday. The former chief operat-
ing officer at private bank Julius Baer's
subsidiary in the Cayman Islands was
detained on Saturday because he risks
destroying evidence, his lawyer Ganden
Tethong Blattner told ATS news agency.
Elmer plans to appeal against
Wednesday’s court decision that found
him guilty of handing over secret files.

CITY MOVES | WHO’S SWITCHING JOBS Edited by Steve Dinneen in association with

Barclays Rockspring partner. He was responsible for

Navigant
Navigant has announced the appointment of
Romek Matyszczyk as a director in its London-
based disputes and investigations team. With
over 20 years of specialist valuation experience,
Romek has advised on all aspects of valuing
businesses, companies, listed and unlisted secu-
rities, intellectual property and intangible
assets. Prior to joining Navigant, he was a part-
ner in the valuations group at Grant Thornton.
Barclays has announced the appoint-
ment of John Worth to the role of
group financial controller.
He has been with Barclays since
2009 as managing director, group
financial control. He joined Barclays
from Ernst & Young, where he was a
partner in banking and capital markets.
John previously worked for Barclays
and Barclays Capital between 1997 and
2002.
Rockspring Property Investment
Managers has announced the appoint-
ment of Mischa Davis as fund manag-
er of the Rockspring Hanover Property
Unit Trust and Charles Baigler as
assistant fund manager of the
Rockspring PanEuropean Property
Limited Partnership. Prior to joining
Rockspring, Davis spent nine years at
Matrix Property Fund Management
where he became a fund manager and
investment strategies, analysing and
securing bank finance for transactions
across Europe, and individual asset
business plans for properties. Baigler
joins from Catalyst Capital, where he
spent four years as a director respon-
sible for acquisitions and the manage-
ment of assets in Central and Eastern
Europe. Prior to this, he was a
Manager in the property finance
group at Royal Bank of Scotland.

To appear in CITYMOVES please email your career

updates and pictures to citymoves@cityam.com SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT +44 (0)20 7557 7245
morganmckinley.com

Don’t miss breaking news

with our new 10:30 AM EMAIL
Each day we’ll cover the morning’s breaking news, give
you current market analysis and the most
up-to-date financial headlines.
Sign up now to ensure you receive our free email.

Visit: www.CityAM.com/newsletter
CITYA.M. 24 JANUARY 2011 News 17

Mitchells & Butlers PORTMAN DOMINATES US BOX OFFICE Chinese giant to

buy into Bank
chairman John of East Asia
Lovering to resign BANKING

▲
INDUSTRIAL and Commercial Bank
of China, the world’s top lender by
market value, will pay about $140m
(£87.5m) for 80 per cent of Bank of
East Asia’s US unit, the two compa-
FOOD AND DRINK have foods-led, rather than drinks led nies said yesterday.
▲

BY JENNY FORSYTH
JOHN Lovering is set to step down as
chairman of the pubs group
Mitchells & Butlers this week, a year
after taking over following an
investor-led board battle.
Lovering, the former chairman of
retailer Debenhams, has told the
board he wants to leave as soon as a
successor is found, because he feels
he has done as much as he can to
improve the group.
His departure is expected to be
announced at the company’s annual
meeting this week.
A source familiar with the compa-
ny told City A.M.: “It has always been
his intention to leave once he’d done
what he set out to do.
“He came in last year and set out a
new strategy in March, which was to
pubs, and that is now the focus of the
company.”
Lovering joined the M&B board in
January last year following a high-pro-
file row instigated by the Bahamas-
based Joe Lewis. Lewis had been
involved in a public spat with M&B,
who accused him of trying to take
control of the board.
The group, which has over 1,600
pubs and restaurants and whose
chains include Harvester, All Bar One
and Toby Carvery, sold over 300 pubs
in the last year, helping it to reduce
debt. Its financial results have also
improved, and the share price is up
almost 30 per cent in the year since
Lovering took the helm.
In September it reported a 4.4 per
cent increase in sales at outlets open
for more than a year, driven by a
surge in demand for food.
The deal, first mentioned in a
report on Friday, will require
approval from regulators in China
and the United States before it is able
to proceed, ICBC and BEA said in sep-
arate statements posted on the Hong
Kong stock exchange.
“Acquiring a controlling interest in
the target bank is an important com-
ponent in the bank’s globalisation
strategy, and the transaction would
complement the bank's overseas insti-
tutions,” ICBC said in the statement.
Bank of East Asia added that its US
unit would now focus on its whole-
sale banking business through its
branches in New York and Los
Angeles.
Natalie Portman pulled in US moviegoers over the weekend, with new release No Strings ICBC’s buy would make it the first
Attached joining Black Swan in the top ten films at the North American box office between Chinese lender to buy into a US retail
21-23 January. No Strings Attached, which co-stars Ashton Kutcher, entered at number one, bank and is likely to be scrutinised by
taking $20.3m (£12.7m) in its opening weekend. US regulators.

Stick up for global

trade, report says
WORLD ECONOMY The UK remained at number 15, headquarters in Ireland will
▲

BY JULIAN HARRIS overtaking Canada but being over- remain,” he added.

GLOBALISATION must be promot-
ed by business and governments as
“a positive force for economic and
social good,” an influential report
said today.
Despite a slight slowdown dur-
ing the recession, the world’s
largest economies will continue to
globalise steadily between now and
2014, according to the Ernst and
Young globalisation index.
And authorities must “avoid any
descent into protectionism,” said
Ernst and Young’s John Ferraro.
The index ranked the world’s
largest 60 economies according to
their level of globalisation relative
to GDP.
ANALYSIS l Level of Globalisation in the World's Largest 60 Economies
taken by Slovakia, which jumped
12 places. Poland and Slovakia both
performed well, largely due to big
increases in internet subscriptions
and tourism.
Despite its economic troubles,
Ireland received a rare piece of
good news, moving from third
place to second place in the list.
“Exports have remained the
bright light in Ireland’s story,
underpinned by the country’s
chemicals, pharmaceutical and
tech sectors,” Ferraro said.
“The government has also
remained absolutely adamant that
Ireland retain its 12.5 per cent cor-
porate tax rate to ensure that
multinational companies that have
“The survey supports the view
that governments will find protec-
tionist arguments less compelling
and more expensive to imple-
ment,” commented Dan Ikenson,
trade economist at the Cato
Institute in Washington DC.
“Openness to trade, finance, and
labour in all directions will become
even more imperative in the years
ahead,” he added.
Despite the global economic
slowdown, there has not been a
return to “ruinous tit-for-tat protec-
tionism,” he said.
According to the World Bank,
400m people in China have
escaped poverty due to trade liber-
alisation, Ikenson said.

Israel

Hong Kong

Taiwan

Singapore

1-20
Most
Globalised
Countries
21-40 rankings

41-60 rankings
 18 News
The pensions chief who says that
investors are no longer a soft touch
NAPF head Lindsay
Tomlinson says
shareholders are
exerting control over
the firms they own
I
t is easy to see why the chairman of
the National Association of Pension
Funds (NAPF) looks more relaxed
these days – this coalition govern-
ment is less keen on beating shareholders
over the head.
Lindsay Tomlinson is lounging on a sofa
in a bright modern office in the NAPF’s
headquarters on Cheapside, opposite the
recently-opened shopping centre One New
Change. It is a far cry from just a few
months ago when Labour City minister
Paul Myners and business secretary Lord
Mandelson took turns at giving sharehold-
ers a kicking.
The pair argued investors had been
asleep at the wheel during the financial
crisis. They said shareholders had exerted
little scrutiny over companies they owned
and in some cases let management pursue
reckless growth as long as the returns
were good. But when the crisis hit it was
left to the taxpayer to underwrite large
parts of the UK banking system, and by
extension, the country’s economy.
Tomlinson, whose members own
around £800bn of UK shares and bonds
issued by the country’s top firms, leans
forward in his seat and says that some of
that was deserved – but only some of it.
The youthful pensions chairman, who
looks a decade younger than his 59 years,
says: “A lot of what the last government
talked about didn’t reflect that the influ-
ence of UK based pension funds had
diminished. Pensions have changed so
much in the last 30 to 40 years. And partic-
ularly since the end of the 1980s. In 1979
exchange controls went in the UK. And
also in the last 15 years a large amount of
private equity, sovereign wealth and
hedge fund money has moved into the
markets.”
Tomlinson’s members own around 12
per cent of the UK stockmarket, with the
rival Association of British Insurers (ABI)
owning the same percentage. Retail
investors own a share, as do other kinds of
UK-based institutions. Another 15 to 20
per cent of the UK market is managed by
UK institutions for overseas investors. The
CV | LINDSAY TOMLINSON
Age: 59
Work: Joins Commercial Union as an
assistant actuary in 1973; joins
Metropolitan Pensions Association (now
Mercers) as a pensions actuary in 1977;
joins Provident Mutual as an investment
manager; from 1987 holds a variety of
senior roles at Barclays Global Investors,
(now part of BlackRock, where he is a
managing director). Became chairman of
the National Association of Pension Funds
in 2009 and is also chairman of the
Takeover Panel’s Code Committee.
Education: St John’s College, Cambridge,
read mathematics
Family: Married, with “five children and
four Labradors.” Lives in Sussex.
rest is owned by overseas investors.
But Tomlinson, who is also a managing
director at BlackRock, is right to point out
that the power of the UK pension funds
and insurance groups is waning. A decade
ago the ABI’s members owned around 24
per cent of UK public companies with the
NAPF holding 18 per cent. And in the mid-
1980s around 80 per cent of the UK stock-
market was held by institutional
managers based in the UK.
He says UK pension funds “no longer
have the critical mass” they once had
among the country’s biggest companies.
He adds that institutions have also been
moving into bonds over the last decade or
more in order to diversify their holdings.
Sovereign wealth funds and hedge
funds now have a great say in UK firms.
And Tomlinson says the trick is to get
them to subscribe to the 1992 UK
Combined Code on corporate governance,
based on the comply or explain principle.
Tomlinson says: “It’s definitely in their
interests for these funds to abide by the
Combined Code. But they have a lot of
other things to worry about. Other codes
in other countries, for one thing. But also
UK companies are regarded as well run.
Whereas there are firms in other regions
that are based around family structures or
have unfair voting rights that need more
attention. So these funds reason: why
spend so much time on the UK system?
Also, foreign funds don’t want to get
caught up in the politics of a situation. If
an issue looks like being highly political
they want to avoid it.”
However, in recent months sharehold-
ers have showed a firmer hand at the tiller
of the companies they own. Investors
rejected Prudential’s proposed $35bn
(£23bn) takeover of AIG’s Asian business as
too expensive and told the insurer to
think again.
“Before the crisis the collapse of the Pru
deal would not have happened,” says
Tomlinson.
He adds that shareholders were quick to
meet with BP’s management in the wake
of its Gulf of Mexico oil spill – a fiasco that
will cost the firm at least $11bn in com-
WORDS BY ROGER BAIRD
The National pensation and clean up costs.
Association of Tomlinson says: “This was a surprise for
Pension Funds a lot of shareholders. They asked the
chairman Lindsay board a lot of questions about how risk
Tomlinson at its group management worked right the way
offices on Cheapside through the company. We wanted to
in the City understand what went wrong.”
Did shareholders push for the removal
Picture: Micha of former chief executive Tony Hayward?
Theiner/City A.M. “I’m a big fan of BP,” says a tight-lipped
Tomlinson. “Good boards take action
before shareholders ask for it.”
Yet Tomlinson admits “the real test” of
this newfound shareholder activism is
how long it lasts when the deal market
picks up again.
Rather than sniping at shareholders,
Tomlinson says, the coalition is more con-
cerned with tackling the budget deficit
and making sure the UK’s corporate tax is
competitive with other parts of the world.
But this government, like the last, is
also fighting its corner in the European
Union to ensure that the comply or
explain principle runs through the heart
of much of the new financial services leg-
islation that is being drafted in Europe.
Others in the 27-nation bloc argue this
lighter touch regulation has failed and
more prescriptive rules are needed.
Tomlinson backs the government. “We
want to make the existing system work
better,” he says. “And I believe it can be
made to work. But this is currently a live
“Companies argument in Brussels.”
However, Tomlinson, who is also chair-
are under man of the Takeover Panel’s Code
Committee (which makes amendments to
siege. the Takeover Code), is currently in the
middle of major rule changing himself.
Takeover The body plans to overhaul the way merg-
ers and acquisitions are governed in the
tactics have UK.
Critics argue firms spend months on
evolved to end fighting a takeover bid, and are also
concerned at the number of UK firms that
favour the end up under foreign ownership.
Last October the Panel responded to
firm making these growing concerns and proposed
that the offer period be cut from three
the offer. ” months to 28 days, and that the predator
firm provide more details about its financ-
CITYA.M. 24 JANUARY 2011
ing and its plans for the new business.
Tomlinson says: “Companies are under
siege for long periods of time. Takeover
tactics have evolved over the last 10 to 15
years and have tilted in favour of the firm
making the offer.”
However, these proposals fall far short
of those advanced by City veteran Sir
Roger Carr, who was the chairman of
British confectionary maker Cadbury,
which was sold to US rival Kraft Foods for
£11.9bn in January.
Carr – now at the CBI – complained he
could not properly defend the iconic UK
firm because once a bid had been made
hedge funds bought into the business and
were only interested in driving up the
price of the company in the short term
before selling to the highest bidder. Many
in the last government and the unions
agreed with him.
Carr argued, among other things, that
investors who bought shares during a bid
should have their voting rights removed
so that “short-term money does not deter-
mine long-term futures”. He also said the
acceptance level for takeovers should be
raised above 50 per cent plus one of share-
holders to make it harder for short-term
shareholders to ride roughshod over the
wishes of long-term investors.
Tomlinson disagrees with this. He says:
“We have spent the last 100 years in this
country evolving shareholder democracy.
I am a firm believer in one share, one
vote.” He also adds that observers were
wrong to look to revisions in the Takeover
Code as a backdoor way of making nation-
al champions out of firms.
He says: “That is for the government not
for us to decide. But UK governments over
a long period of time have favoured open
markets.”
Tomlinson says he expects the Takeover
Panel to publish a detailed draft of its pro-
posals by then end of the first half of this
year. Until then, Tomlinson has plenty on
his plate. His members, who have recently
found their voice, might not have the all-
pervasive influence they once had, but
they still have an important say on how
corporate Britain thinks and acts.
CITYA.M. 24 JANUARY 2011 News 19

Look outside London to drive City’s growth

and across a variety of sectors.
It could be inferred that such a com-
mitment – shifting the focus away
from London and the financial servic-
es industry – is bad news for the City.
However, anyone with any doubts as
to how important a role financial serv-
ices will play if we are to achieve this
CITY COMMENT ambition should take a closer look at
the areas outside of London and what
MICHAEL BEAR is driving their economies.
This is a point that was made clear
South East.
Leeds is one of the foremost centres
for financial services in the UK and
was recently ranked among the top 25
cities for business in Europe, ahead of
larger, higher profile financial centres
such as Rome, Moscow and Athens.
With banking and insurance servic-
es increasing by 107 per cent between
1997 and 2007, it is clear that the
industry will be a key driver of eco-
nomic growth in this area in the years
will need if we are to succeed in creat-
ing growth based around greater eco-
nomic diversity.
This is the message I took to Leeds
when I visited last week to meet with
various regional business leaders so I
can better represent the industry both
at home and abroad.
This week, for my first overseas visit
of 2011, I am leading a business delega-
tion to Turkey – a country that David
Cameron last year stated is “vital for
our long-standing support for their
accession to the EU.
The scale of future opportunities for
both countries is enormous. Not only
does Turkey boast a tradition of eco-
nomic stability, but the 10 per cent
growth it exhibited during the second
quarter of 2010 made it the fastest
growing economy in the G20.
Working in partnership with finan-
cial centres in the UK as well as with
our most important overseas partners

T
he government has made clear
that its top priority for 2011 is to
drive forward growth in the UK
economy and to ensure this
growth is spread across the country
when I visited Leeds last week.
Of the one million people the finan-
cial and professional services industry
employs throughout the UK, less than
a third are based in London and the
to come.
Only a sophisticated and globally
connected financial services industry
is capable of delivering the combina-
tion of financing British businesses
our economy, vital for our security and
vital for our politics and diplomacy”.
As a vital link between East and
West, Turkey is clearly an important
business partner for the UK – hence
will help to generate greater economic
growth for all, whether they are based
in London, in Leeds or in Istanbul.
Michael Bear is Lord Mayor of the City of
London

NEWS | IN BRIEF
Telefonica furthers Unicom alliance
Spain's Telefonica and Chinese mobile oper-
ator China Unicom will deepen their strate-
gic alliance by buying an additional $500m
(£312.5m) stake in each other. The two
companies, which together have more than
550m clients in Europe, Asia and Latin
America, are exploring joint investments in
parts of Asia and Africa where they are not
already present. After the new purchase,
Telefonica's stake in China Unicom will rise
to 9.7 per cent, while China Unicom's owner-
ship of Telefonica will reach a total of 1.37
per cent. China Unicom, which will purchase
21.8m shares of Telefonica in the coming
days at an agreed on price of €17.16 per
share, will get a seat on Telefonica's board.
Telefonica will buy $500m worth of China
Unicom shares from third parties over a
nine-month period.

The value of business travellers’ luggage has shot up with the introduction of high-tech portable items such as iPads

Business bags full

of hi-tech cargo
BUSINESS TRAVEL and wants to be as ready, able and son’s carry-on bag includes an
▲

BY JOHN DUNNE
BUSINESS travellers take items
worth nearly £1,500 in their air-
plane carry-on bags, according to a
survey.
The research found that business
people typically take 12 items,
including essentials like tooth-
brushes and a shirt.
But now smartphones and iPads
– costing around £700 – are mak-
ing their way onto the list as tech-
nology becomes a must-have tool
for modern business.
Alison Couper, global communi-
cations director at Hotels.com –
which carried out the research –
said: “Today’s business traveller is
working harder than ever before
informed to do their job when
they are on the move as in the
office.
“However, our survey shows the
price of staying refreshed and in
touch is a high one for the modern
jet-setting employee.”
The half-yearly index will chart
the contents of bags to see what
travellers are deeming as key to a
successful business trip.
Couper added: “It’s as important
as ever for businesses to control
their costs. The Carry-On Bag Index
gives a glimpse of the expense of
flying from country to country
even before travel and accommoda-
tion are put into the equation.”
According to the survey, the list
of typical items in a business per-
Apple iPad worth £699, a
BlackBerry Torch 9800 (bought at
Carphone Warehouse SIM-free)
which is worth £464.95, a
Moleskine ruled notebook worth
£15 and a travel pillow worth
£5.99.
Other favourite items include a
Mont Blanc Rollerball pen, valued
at £230, an adaptor plug, worth
£3.99, the Economist, worth £2,
some Colgate Total toothpaste,
worth £1.45, Sure roll-on deodor-
ant, worth £1.69 and a Marks &
Spencer pure cotton non-iron shirt
worth £25 plus Marks & Spencer
lambswool socks worth £10.
Additionally, those with discern-
ing taste could also carry a copy of
this newspaper – totally free.
 Wealth Management
20 CITYA.M. 24 JANUARY 2011

Playing the new uranium boom

Take care how you get uranium. However, there are two new er, they are less than 9 per cent of the ETF and Extract Resources among its top 10
your uranium exposure funds that are designed to reflect the Securities fund. The fund counts Areva holdings.
performance of companies and Toshiba among its top holdings, giv- The fund also provides investors with
engaged in various aspects of the ing it greater exposure to the construc- more potential upside due to the inclu-
uranium industry. tion of nuclear reactors. Over the sion of exploration companies such as
The annual management past six months however, Laramide Resources, which has signifi-
fee for both funds is 0.69 per their shares have only cant land packages in Australia and the
cent and both hold Cameco, appreciated by 7 per cent US. The fund is up 17 per cent since its
Paladin and Uranium One, and 15 per cent respec- launch in November last year. By contrast
BEN MOUNTIFIELD which together produce tively. the ETF Securities fund is up 7 per cent.
INVESTMENT COMMENT around 20 per cent of the Although the ETF These ETFs provide investors with an
world’s uranium. Over the Securities fund pro- easy way to gain exposure to the uranium

O
VER the past six months, the price past six months the shares vides greater diversifi- sector without having to pick individual
of uranium has risen more than 60 of Cameco and Paladin are cation, it is unlikely to stocks. The Global X ETF however, would
per cent to $68 an ounce and up over 50 per cent while provide the exposure be my choice since it’s more heavily
thanks to increasing demand and Uranium One is up nearly to a rising uranium weighted towards the miners and corre-
tight supply, prices could be headed even 90 per cent. price that comes lates more closely to moves in the urani-
higher. Where these funds differ is from holding the um price.
There are 442 operating nuclear reac- their asset allocation: the Global X ETF, which Ben Mountifield is the author of the monthly
tors worldwide but with 60 new ones three miners make up over 40 also includes Denison newsletter ‘The Mountain Investor Report‘ See:
under construction (a further 156 are in per cent of the Global X ETF; howev- Mines, Kalahari Minerals www.mountaininvestor.com
the planning stages) and fuel supplies
from stockpiles dwindling, it’s hardly sur-
prising that uranium prices have been FUND PROVIDED BY FUND NAME DESCRIPTION (FROM THEIR WEBSITE) EXCHANGE / TICKER
pushing higher. The supply of this vital
metal looks set to get tighter still as
Russia closes the doors on its “megatons Global X Funds Global X Uranium ETF “The Solactive Global Uranium Index is designed to reflect the per- NYSE Arca / URA
to megawatts” programme in 2013. Under www.globalxfunds.com formance of the uranium mining industry. It is comprised of selected
the scheme, which has been running companies globally that are primarily engaged in some aspect of the
since 1995, more than 15,000 ex-Soviet uranium mining industry such as mining, refining, exploration, and
warheads have been down-blended to manufacturing of equipment for the uranium industry.”
reactor grade fuel.
By 2014, global demand is projected to
be 95.7m kilograms, up from 76.6m kg
today. This will leave an estimated annual ETF Securities ETFX WNA Global Nuclear “ETFX WNA Global Nuclear Fund is designed to track the perform- London Stock Exchange / NUKE
shortfall of around 36m kg, which is like- www.etfsecurities.com Energy Fund ance of the WNA Nuclear Energy Index. The WNA Nuclear Energy
ly to result in higher prices both for the Index is designed to track the performance of approximately 65
metal and for those companies capable of companies engaged in the nuclear energy industry with representa-
bringing uranium to market. tion across reactors, utilities, construction, technology, equipment,
There is currently no ETF (Exchange service providers and fuels.”
Traded Fund) that tracks the spot price of

Stocks to start the week lower on China fears

MARTIN ON along the way to close at its lowest
level for five weeks, and it looks like
ANALYSIS l FTSE
6,100
swings on the first day of trading for

THEMARKETS
the bears could resume control once
again this morning.
GFT is quoting the FTSE 100 index
to open down 10 points from Friday’s
close, at a level of 5,886. Elsewhere in
Europe the German Dax is called to
open unchanged at 7,062, and the
French CAC is quoted down 3 points
to open at 4,014.
CHINA ECONOMY CAUSING CONCERN
The latest prime culprit for the
renewed selling pressure on equities
MARTIN SLANEY is the lingering fear that the Chinese
economy is overheating.
Figures for China’s Gross Domestic
5,896.25 the newly formed International
21 Jan Airlines Group, created by a merger of
5,900
Spain’s Iberia and British Airways.
The new group forms Europe’s sec-
ond-largest airline, and has already
5,700 targeted further acquisitions, but
investors may be put off by the threat
of a fresh wave of strikes.
Martin Slaney is director of GFT’s global
25 Oct 12 Nov 2 Dec 22 Dec 14 Jan dealing operations
ing measures from Beijing are in the ing that British retailers had the
offing.
Tomorrow sees the release of UK’s
worst December ever – the cause
being a chilly combination of the
own GDP data for the fourth quarter, snow and soaring food prices.

D
espite closing on Friday on a
mild high, over the course of
the week the FTSE still dropped
nearly 1.8 per cent, managing
Product showed the country still and traders may well err on the side
charging along at an annual increase of caution ahead of the announce- IAG IN FIRST DAY OF TRADING
of 9.8 per cent, which also stoked ment which follows a shockingly low Also today watch out for potential
fears that further monetary tighten- retail sales figure last Friday, indicat- high volumes and some interesting

WALL ST WEEK AHEAD

T
The much anticipated pullback
is finally under way, some
investors say, after a mid-week
wobble. But the market is show-
ing it still has some juice left – if earn-
ings can meet towering expectations.
This earnings season, if you’re
good, you’re just OK. If you’re just OK,
you’re bad. And if you’re bad, you’re
quickly taken outside and put out of
your misery. Only the truly great are
lauded – and even then not very
much.
In an environment like that, and
with a heavily extended market, dis-
appointments are taken hard. The
S&P 500 just ended its first down
week in eight with underwhelming
results from the likes of Goldman
Sachs and Freeport McMoRan Copper
& Gold weighing on indexes.
Some big energy companies such as
Chevron and ConocoPhillips are
reporting results this week.
Expectations have been running up
in the sector, the third- largest in the
S&P 500, providing plenty of room for
disappointment.
“We have been climbing up a
mountain, and we are on a ledge
here, so there is definitely a bit of a
pause as people are going to need
some evidence of accelerated recov-
ery – not just baseline recovery,” said
Rick Meckler, president of investment
firm LibertyView Capital
Management, in New York.
Analysts have beefed up expecta-
tions as stocks rocketed late last year
on signs of an improving economy.
S&P 500 earnings estimates for the
current quarter were revised up 1 per
cent over the last 60 days, according
to data from StarMine.
Positive revisions were heavily con-
centrated in the technology, energy
and materials sectors. Estimates in
the materials sector were raised 5.7
per cent; in energy, they rose 4.8 per
cent, and in technology, 2.3 per cent,
StarMine said.
Unsurprisingly, those three sectors,
along with financials, took the brunt
of selling last week. Materials shares
fell the most, losing 3.3 per cent over
the week.
Wall Street will tune in to President
Barack Obama’s State of the Union
address tomorrow night, when he is
expected to make job creation the No.
1 issue.
The Federal Reserve’s policy-mak-
ing panel also will meet for the first
time this year, convening tomorrow
and concluding on Wednesday.
CITYA.M. 24 JANUARY 2011 Wealth Management 21

LONDON’S TOP 250

Company Name Closing Price Price Change 52wk high 52wk low Company Name Closing Price Price Change 52wk high 52wk low Company Name Closing Price Price Change 52wk high 52wk low Company Name Closing Price Price Change 52wk high 52wk low
(p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p)

3i Group 319.75 3 340 250 Colt Telecom 148 4 148 109 Jardine Lloyd 639 2 639 459 Rotork 1635 -3 1895 1215
3i Infrastructure 116 0.25 125.25 101 Compass Group 564 6 594 425 John Wood Group 543.50 14.50 581.50 293 Royal Bank of Scot 45 2.75 58 31.25
A.B. Foods 1086 7 1182 873.50 Cookson Group 638 13.50 687.50 367.50 Johnson Matthey 1885 -17 2100 1446 RSA Insurance Grp 132.50 -0.50 136.50 114.75
Aberdeen Asset.Man. 211.75 -2.50 225 112.75 Croda International 1510 1 1625 751 Jupiter Fund Man 307.50 2.50 314 180.25 SABMiller 2102.50 22.50 2306 1650
Admiral Group 1656 34 1693 1114 Daily Mail & Gen 566 0 590 432.50 Kazakhmys 1544 6 1671 965 Sage Group 280.25 4 289 222
Aegis Group 141.25 -0.50 145.50 103.50 DAVIS SERVICE 437 0 450 360.25 Kenmare Res. 33 0.75 35 9.25 Sainsbury (J) 370.50 0.25 395 313
Afren 151.75 -0.50 161.75 79 De La Rue 819.50 5.50 984 549.50 Kingfisher 267.50 3.25 271.25 198.50 Schroders 1811 -5 1922 1116
African Barrick Gold 529 11 670 503 Debenhams 68 1 79 53 Ladbrokes 132 -0.75 162.75 122.75 Schroders NV 1414 7 1508 929.50
Aggreko 1419 -1 1685 882 Derwent London 1545 -10 1605 1208 Lancashire 571.50 2.50 647 442 Scot.& Sth. Energy 1217 6 1258 1010
Alliance Trust 367.75 0.75 378 293.50 Diageo 1204 7 1250 1000 Land Securities 678 -1.50 707 545 Scottish Mortgage 704 -1.50 717.50 475
Amec 1170 9 1226 733.50 Dixons Retail 22 0 36.50 21.25 Legal & General 110 0.25 111 69.75 SEGRO 288 -4.50 341.25 250.25
Amlin 389.75 3.25 433 366.75 Domino’s Pizza 523 11 586 309.25 Lloyds Banking Grp 67.25 0.50 77.50 46.50 Serco Group 558 0.50 651 494.25
Anglo American 3091 24 3410 2254 Drax Group 388.75 -1.50 421.50 326.25 Logica 136.75 0.75 148 101.75 Severn Trent 1401 -10 1499 1086
Antofagasta 1411 -8 1634 761 DS Smith 213.50 0.50 226 104 London Stock Ex. 847 7.50 906 544 Shaftesbury 441 -0.25 460 349.25
Aquarius Platinum 352.50 -3.50 458 227 Dunelm 470.50 1.50 550 325.25 Lonmin 1753 9 2113 1355 Shire 1639 -17 1674 1220
ARM Holdings 518 8.50 536.50 189.25 easyJet 382 0 496.50 348.50 Man Group 282 -12 310.50 202 SIG 143 -0.50 153.25 90.75
Ashmore Group 353 4.75 383.75 218 Edin.Inv.Tst. 434.75 2.75 467.25 364 Marks & Spencer 368 1 427.50 323.50 Smith & Nephew 699.50 4.50 714 537.50
Ashtead Group 163.50 2 177 77 Electrocomponents 251 2.50 279.50 174.75 Meggitt 358 3.50 381 251.50 Smiths Group 1340 -15 1388 995.50
AstraZeneca 2963.50 41 3385 2732 Enquest 145.50 8.25 150.50 89.25 Melrose 303.75 -3.25 329 162 Soco International 370 3.25 484.25 292
Autonomy 1480 56 1975 1271 Essar Energy 534.50 0 589.50 383 Mercantile Inv Tst 1119 3 1133 828 Spectris 1307 -18 1418 735
Aveva Group 1612 0 1673 1007 Eurasian Nat Res 1029 3 1266 818 Michael Page 526 15.50 565.50 346.50 Spirax-Sarco 1850 46 2025 1240
Aviva 436.50 8.50 436.50 294.25 Euromoney Inst. 707 3 732 461 Micro Focus 398.50 -3 546.50 276 Spirent 137.25 -4.75 160.25 102.75
AZ Electronic Materials SA (WI) 298 -2 317.50 249 Experian Group 761.50 4 819 572 Millennium & Cop. 561 -4 594.50 368.50 Sports Direct 168 5 174.75 92.25
Babcock International 560 6 635 492.75 Ferrexpo 419.75 0 448 197 Misys 339.75 8 343 201.50 St James’s Place 293 12 293 204.25
BAE Systems 349.50 6.50 388.75 294.75 FirstGroup 379 -3 412.50 336 Mitchells & Butlers 349 -2 361 265.50 Stagecoach Group 200.50 -1 224 160.75
Balfour Beatty 325.50 5.25 327 229.75 For.&Col.Inv.Tst 310 1.25 316.25 251.50 Mitie Group 231.25 0.75 241 188.75 Standard Chartered 1673 -34 1950 1351.75
Barclays 301 -2.25 383.25 255.25 Fresnillo 1349 3 1682 669.50 Mondi 489.75 -4.25 557.50 338.25 Standard Life 223.75 1.75 236 173
Barratt Development 98 0 137.75 70 G4S 262 1 283.50 237.75 Monks Inv.tst. 355.50 0.50 363 271 Supergroup 1550 -3 1638 535
BBA Aviation 220 0 228 158 Genesis E.m.f. 539 0 568 399 Morgan Crucible 265 0.75 274.25 159.75 SVG Capital 247 -1 250 125.25
Bellway 664.50 -2 809 511 GKN 212 -2 237 102 Morrison (Wm) 264 1.50 306.25 257.50 TalkTalk 151 -2 168.25 108.50
Berkeley Grp Hldgs 919 3 960 742 GlaxoSmithKline 1156 4.50 1318.50 1095 Murray Int.Tst 921.50 -3.50 966 736.50 Talvivaara Mining 586.50 16 620 342.50
Betfair Group 1000 -15 1550 882 Great Portland Est. 355 -0.50 369.25 279 National Express 242 -3.75 259.50 195.50 Tate & Lyle 555 3 564.50 388.75
BG Group 1313 14.50 1366 984 Greene King 447 -4.50 491.50 376.25 National Grid 542 3 596.25 484.25 Taylor Wimpey 36.50 1.25 44 22.25
BHP Billiton 2393 11 2616 1684.50 Halfords Group 406.25 0.50 550 372.75 Next 2144 8 2344 1817 Telecity Group 444.50 -8.25 532.50 360
BlackRock Mining 780 -4 815 492 Halma 320 -7 366.50 223 Northumbrian Water 303.75 -9.25 361.50 252.75 Templeton Emrg. 636 -5 689.50 471.50
BlueCrest AllBlue 170.25 0.25 174.50 156.25 Hammerson 436 -1.25 437.50 336.25 Ocado Group 227 13.50 227 123.50 Tesco 400 1 454.50 377.50
Booker Group 58 -0.50 60.50 38.75 Hargreaves Lansdown 517 1 599 276.50 Old Mutual 125.25 -0.75 145.25 97.25 Thomas Cook Group 199.25 2.50 272 171.75
BP 497.25 3.25 655.50 303 Hays 121.50 0 133.50 88.50 PartyGaming 199.25 -6.75 334.50 199.25 Travis Perkins 1033 -5 1127 664.50
Brit Insurance 1050 -1 1055 728 Henderson Group 152.25 2.50 155.50 112.75 Pearson 1043 4 1051 855 TUI Travel 267 5 308.50 190
British Amer.Tob 2282.50 -14.50 2521 1959 Heritage Oil 439.50 5.25 581 296.75 Pennon Group 614 -10.50 650 483 Tullett Prebon 395.75 4.75 420.50 262
British Empire Tst 500.50 1 512 396.50 Hikma 889.50 -5.50 900 525 Persimmon 422 -3 507.50 336.50 Tullow Oil 1330 23 1388 991.50
British Land 516.50 -7 537 418.25 Hiscox 382 2.50 399 326.25 Petrofac 1582 -6 1685 876.50 UK Commercial Prop 80 -0.25 85 72.75
Britvic 445.25 3.75 518 404.50 Hochschild Mining 489 -11.50 658 234 Petropavlovsk 1042 -13 1365 852 Ultra Electronics 1753 22 1895 1265
Brown (N.) Group 298.75 -4.75 311.25 206.50 Home Retail Group 214 -1 295 188.50 Phoenix Group Hldgs 591 -3 758 557.50 Unilever 1912 22 1997 1688
BSkyB 751 5 751 524.50 Homeserve 441 0 487.50 326.25 Premier Farnell 283 1 304.50 174 United Utilities 550 -7 628.50 507
BT Group 174.50 -2 190.75 110 Howden Joinery 118 4.50 118 56.75 Premier Oil 2011 23 2025 1017 Utd Business Media 702 1 712 409.75
Bunzl 740 0 777 616.50 HSBC Holdings 695.75 -1.50 719.50 596.25 Provident Financial 966 0 999.50 728.50 Vedanta 2371 -1 2934 1839
Burberry Group 1031 -14 1156 590.50 Hunting 752.50 -4.50 806 439.50 Prudential 665 -2 697.50 487.50 Victrex 1402 10 1522 806
C&W Comms 48.25 -0.25 63.75 44.25 ICAP 553.50 8 570.50 294 PZ Cussons 370 -6 409 243 Vodafone Group 175.75 3 178.75 129.50
C&W Worlwide 70 2.75 100 60.50 IG Group 469.50 0.50 553 362.50 QinetiQ Group 136 1.50 142 96.75 Weir Group 1653 36 1861 735.50
Cairn Energy 445 8 493.25 318.25 Imagination Tech 384.25 1.50 441.75 215 Randgold Res 5025 61 6655 4209 Wellstream Holdings 784 0 793.50 436
Caledonia Inv. 1872 12 1928 1512 IMI 890 -1.50 953 530.50 RDS ‘A’ 2142.50 27.50 2162 1624 Whitbread 1720 -14 1887 1266
Capita Group 697.50 -5.50 826 635.50 Imperial Tobacco 1799 -12 2154 1753 RDS ‘B’ 2138 31 2159.50 1554 William Hill 185.75 2.75 216.50 155.50
Capital & Counties 146.25 0.75 157 100 Inchcape 379 -3 394.75 237 Reckitt Benckiser 3390 44 3655 3037 Witan Inv Trust 510 0.50 522 410
Capital Shop Centre 374 -3.50 424.75 301 Informa 435 1 448 304.50 Reed Elsevier 561 5 563 460.50 WOLSELEY 2170 -3 2195 1223
Carillion 380 0.50 387.50 273 Inmarsat 626.50 5.50 821 606.50 Regus 99.25 0.25 120 66 WPP Group 794.50 7 802 572.50
Carnival 2980 13 3153 2037 InterContinental Htl 1295 8 1332 887 Renishaw 1325 -13 1342 565.50 Xstrata 1402 13.50 1535 845.75
Catlin Group 374.25 3.25 393 320 Intermediate Cap.Grp 338.25 -2.50 360.25 240.50 Rentokil Initial 102.50 1 138.50 87.75 YULE CATTO 220 0 221.25 106
Centamin Egypt 147 0.75 197 106.75 International Pers Fin 342 5.50 386.50 183.25 Resolution 246.75 -2.75 328.50 211.25
Centrica 326.50 -3 346 264 International Power 412 -4.75 448.50 284.50 Rexam 339.50 3.25 356 276.50 LONDON TOP 250 BY MARKET CAPITALISATION
Charter 791.50 -8.50 853.50 567 Intertek Group 1715 -5 2000 1150 Rightmove 785 -10.50 812 500.50
Chemring Group 3245 79 3663 2598 Invensys 335 5.50 364.25 230.25 Rio Tinto 4243 6 4584 2812 POWERED BY
Close Brothers 852 0 888.50 664 Investec 500 0 562 417.75 RIT Capital Partners 1322 11 1322 971.50
COBHAM 219.50 1.75 276 192.25 ITV 75.25 -0.75 78.50 48.25 Rolls-Royce Group 627 -3 665 473.50
www.digitallook.com
 22 Wealth Management | Spread Betting CITYA.M. 24 JANUARY 2011

S&P 500 is
on the edge
of a painful
correction
But there are good reasons to be
optimistic, says Daniel Knowles
Ready to fly? Or just

T
HE SCOTTISH journalist Bertie
Charles Forbes once said:
“Optimism is the stuff of which
American business success is fash-
ioned”. He would have seen much to be
happy about in the USA now. Though
unemployment remains stubbornly high,
American investors at least are seeing the
bright side.
The S&P 500 index of stocks has rallied
by 8 per cent in the last three months and
2.66 per cent in the last month alone. At
the end of last week, however, the index
seemed to be struggling a little. Christmas
is now long forgotten. Is it time for spread
betters to prepare for a correction?
Kully Samra, a director at Charles
Schwab, an American brokerage, argues
that it’s possible. “Sentiment is a little
frothy right now,” he says, “and earnings
expectations are quite elevated”. Samra
reckons that if a few American companies
report disappointing results, it could trig-
ger some profit taking.
He points to several indicators suggest-
ing that market sentiment might be a lit-
tle too optimistic at the moment. The
SentimenTrader index measuring the gap
between “smart money” and “dumb
money” optimism shows a large gap
emerging from around December, as
“dumb money” got more confident and
“smart money” less.
Similarly, individual investors (rather
than institutional investors) are now more
bullish than at any point in the last three
about to leap off a
cliff?
Picture:
GETTY
years, while bearishness is very low. S&P 500, at least in the short term. Ben However, while it might make sense to
Interestingly, the last time the gap Barty-King, an options trader at ETX be short at the moment, if the market
between bulls and bears was so large was Capital, suggests that traders should does drop sharply, it might also present
in spring 2009, though then the gap was watch the performance of the index quite an excellent opportunity to buy. As Samra
the other way around. That point was ret- closely. “The key pivot point is 1,268.5” he points out, this is a pre-election year, and
rospectively described as the “mother of says. “If it stays above that level, then it historically, the American stock market
all market bottoms”. could well keep going”. If not, Barty-King has not dropped in a pre-election year
So is this the mother of all market tops? suggests the index could drop down to since 1945. In fact, on average it has
Well, probably not, but spread betters around 1,235 points. gained 17 per cent.
would still seem wise to go short on the With large numbers of individual
WATCH OUT FOR THOSE RESULTS investors flocking back to the American
ANALYSIS l Sentiment Traders confidence index shows the smart money is less confident It would also seem wise to watch individ- stock market from bonds and from
ual stocks. The S&P 500 was sharply up on emerging market funds, it is not unrea-
100 Smart Money Confidence (Left) 1,400
Friday after General Electric (GE) reported sonable to expect the US stock market to
Dumb Money Confidence (Left) its results, but many more are coming. have another good year. Many American
90 S & P 500 (Right) 1,200
Halliburton and McDonalds release their firms are sitting on large piles of cash,
80 1,000
report on Monday, while on Tuesday, which may make for a boom in mergers
70 Johnson and Johnson does, among others. and acquisitions, while consumer spend-
800
60 Though more market shaking revelations ing, manufacturing and earnings growth
600
50 on the scale of Steve Jobs’s announcement data are all solid. There are lots of very
400 last week are unlikely, traders willing to good reasons to be optimistic about the
40
30 200 follow individual companies closely medium run performance of the market.
20
Source: www.sentimentTrader.com as of December 2010
0 might well profit from the swings in par- But traders should perhaps wait a while –
2009 2010 ticular stock prices. lest they be disappointed.

THE WEEK AHEAD in association with

THE TIPSTER that its European head, Andrea
Moneta, has been replaced by its
North American head, Igal
COMPANY NEWS ECONOMICS NEWS
SAGE DATA COULD Mayer. The company’s most
POLITICAL NEWS recent trading update was

l Electronics company
Philips publishes its 2010
full year results on Monday.
l Monday sees France,
Germany and the European
Monetary Union (EMU)
l Germany’s consumer l French President Nicolas
BE A CATALYST promising since it announced
plans to cut debt by at least
price index (CPI) is pub- Sarkozy briefs the media £700m over the next three
lished on Thursday. and diplomats on France’s years. But the good news was

l Sodexo, the food servic-
es provider, releases its
first quarter 2011 results
on Monday.
l Tuesday sees Ericsson
report its fourth quarter
2010 results and Siemens
its first quarter 2011
results.
l WH Smiths will hold its
annual general meeting
and issue a trading update
on Wednesday.
l On Thursday, Nokia will
issue its fourth quarter
2010 results and Tullow Oil
will publish a trading
update.
publish the results of their
respective purchasing man-
agers index (PMI).
l The Bank of Japan
makes a rates announce-
ment on Tuesday.
l The UK releases its
fourth quarter GDP figures
on Tuesday.
l The US January con-
sumer confidence index is
published on Tuesday.
l On Wednesday, the Bank
of England releases the min-
utes of its last meeting and
the US Federal Open
Market Committee makes a
rates announcement.
priorities and agenda for its
l The EMU posts the presidency of the G8 and
results of its January con- G20 on Monday.
sumer confidence index on
Thursday. l The annual meeting of
the World Economic Forum
l On Thursday, the US in Davos-Klosters begins on
December pending home Wednesday this week.
sales data is released.
l President Barack Obama
l The Japanese unemploy- gives his State of the Union
ment rate and overall address on Tuesday.
household spending figures
are posted on Thursday. l On Tuesday, the Indian
President gives a national
l The all important US address for Republic Day.
fourth quarter GDP figure
is announced on Friday. l UN Secretary General
meets with the Greek
l The EMU’s broad meas- Cypriot and Turkish Cypriot
ure of money supply (M3) leader to discuss the reunifi-
is released on Friday. cation of Cyprus on
Wednesday.
A
N INTERIM management
statement is due from
Sage, the software serv-
ice provider, on
Wednesday. Renewed confidence
in the economy should bode well
for the company, which has seen
shares creep back to the levels it
achieved before the credit
crunch. Admittedly, the stock
remains a long way below the all
time highs of the dot-com bub-
ble, but with analyst support
edging up too, the numbers later
this week could prove to be
something of a catalyst. The cur-
rent IG Index price is 279.5p-
280.4p.
The world’s sixth largest
insurer Aviva has been trending
upwards since 1 December. The
latest news on the company is
overshadowed by investors’ con-
cerns about the reasons for this
action. Capital Spreads quotes
437.3p-438.2p.
The euphoria investors felt for
the FTSE 100 at the start of the
year has given way to worry and
some have begun to beat a path
to the exit door. While European
sovereign debt concerns have
alleviated in recent days, traders
are becoming increasingly con-
cerned about rising inflation in
China. With the FTSE 100 so
heavily overweight in commodi-
ty related stocks, any negative
shift in sentiment is likely to
send it sharply lower. ETX
Capital is quoting 5,912-5,913
for the UK 100 rolling daily con-
tract.
Donata Huggins
 Lifestyle
Israel’s land of plenty
Zoe Strimpel finds too much to do,
feel and see in this land of contrasts.
From the buzzing restaurants, beach,
bars and art scene of Tel Aviv to the
ancient history of Jerusalem, Israel’s
cup truly runneth over
“ W
OW,” says my (non-Jewish)
friend. “Whenever you’ve
banged on about how gor-
geous Israeli men are, I
always thought you were just being biased.
But you weren’t. They are. This is
madness.”
Olivia and I are one-and-a-half hours off
our brilliantly Israeli El Al flight – think
warm bread rolls, smoked salmon, mid-
aisle prayer, non-stop gossiping between
flight attendants and passengers because
Israel is small and “everyone knows every-
one”. Having dropped our things in a sea-
facing room at one of Israel’s oldest hotels,
the Dan (pictured below), we’re now in a
bar.
The bar is called HaMaoz (King George
32) and, like everywhere else cool in deli-
cious but derelict Tel Aviv, looks like noth-
ing much on the outside. Inside, though,
and on the covered, somewhat sleepily-
guarded terrace (no bombings for a while),
it is rammed to the rafters with hipsters.
The bar is done up to be like a living room,
with fridge magnets, homey sofas, cup-
boards, home-style toilets and other recy-
cled domestic bits and pieces. This is a
typical example of Tel Avivian bar style: des-
perately creative, as though its customers’
lives depend on having somewhere super-
cool to see and be seen and to drink, at
night. In some ways, they do – known as
the Bubble, Tel Aviv stands apart as a hedo-
THE SAVOY GRILL’S 23
TRIUMPHANT RETURN
| Travel REVIEWED IN TOMORROW’S
LIFESTYLE SECTION
Tel Aviv, with its high- nistic, forget-the-politics-and-your-woes
rises and long beach, enclave in Israel. You can dance with drag
seen from a rocky queens, gyrate in a club done up as a MORE QUALITY INCLUSIONS THAN ANY
enclave in Jaffa. church complete with stained glass win- OTHER RESORTS ON THE PLANET
Below: the Dan Tel dows and an altar, pick up a threesome on
Aviv – with its iconic a rooftop dancefloor or eat the finest food
rainbow front – enjoys you will ever find in a posh, mosaic-tiled
a prime position on restaurant.
the beach. Back to HaMaoz. We find some space
SAVE 30%
next to an almost comically attractive *
UP TO
young man, who is chatty and friendly,
informing us that he is a domestic pilot *
and beach lover – his regular spot is on
Gordon Beach (the long Tel Aviv beach is
PLUS UP
TO AN EXTRA £300 PER COUPLE
divided into several parts; Gordon isn’t far
from our hotel) and we are welcome to join
him there the next day, Wednesday (mid-
week beach lounging is the norm in TA).
When he leaves, we meet someone else,
an intense, bald-headed advertising cre-
ative, who invites us to his apartment for
some supper, despite the hour being after
1AM. We contemplate his offer (friendly
rather than creepy in the context of a
country in which European social norms
are all but meaningless and midnight din-
ners, or 3AM street snacks of bourekas and
falafel are de rigueur), but decide to head
home, via another bar on the street. It’s
packed despite being 2AM on a Tuesday
Sandals Royal Caribbean Resort & Private Island, Jamaica
night, with more cool and beautiful people
lounging in luxurious chairs and talking
intensely at the bar. JANUARY PRICE FREEZE. TRAVEL AT 2010 PRICES!^
The next day we hit the beach, the puls-
ing heart of Tel Aviv. Here, hippies (and SAINT LUCIA SAINT LUCIA BAHAMAS
there are many in Israel – as anyone who
has travelled to India will know), models,
pervy old men, ball-players and posers
come together. It stretches from the Hilton
at one end all the way to the minarets and
pale stone of Jaffa at the other. It’s Sandals Halcyon Beach Sandals La Toc Sandals Royal Bahamian
November but the sun is scorching at 30 7 nights Luxury Included® 7 nights Luxury Included® 7 nights Luxury Included®
degrees and the Mediterranean is balmy. 25 April - 28 June 2011 25 April - 28 June 2011 25 April - 28 June 2011
Heaven – but we soon get twitchy feet and WAS £1873 NOW fr. £1399 WAS £2016 NOW fr. £1499 WAS £2103 NOW fr. £1659
begin to stroll. SAVE £474 p.p. SAVE £517 p.p. SAVE £444 p.p.
We wander into Neve Tsedek, the oldest
quarter of the city and its most charming – ANTIGUA JAMAICA JAMAICA
in a sad departure from its humble origins,
this also makes it the most expensive.
High-end boutiques selling interesting
clothes – many made by the new wave of
avant-garde Israeli designers – sit cheek by
jowl with patisseries, luxury ice cream par- Sandals Grande Antigua Sandals Grande Riviera Sandals Whitehouse
lours and wine bars. A new development at 7 nights Luxury Included® 7 nights Luxury Included® 7 nights Luxury Included®
the southern end of Neve Tzedek’s main 25 April - 28 June 2011 25 April - 28 June 2011 25 April - 28 June 2011
street, Shabazi, is a favourite with the WAS £1963 NOW fr. £1495 WAS £1532 NOW fr. £1199 WAS £1902 NOW fr. £1489
numerous French tourists and contains SAVE £468 p.p. SAVE £333 p.p. SAVE £413 p.p.
beautiful bistros, stalls and boutiques.
We dip into a split-level bookshop, Visit www.sandals.co.uk, call 0800 742 742 or see your local travel agent
which feels like somebody’s house, and *Book by 28th February 2011 for travel up to 26th December 2011. Discount varies depending on room category booked between: 25% plus £100 saving
spend a while among the wonderful range per couple for entry level rooms, 30% plus £200 per couple for guests in Concierge level rooms and 30% plus £300 per couple for guests staying in a Butler
Service suite. Discount is off accommodation portion only. Minimum stay 7 nights. Terms & conditions and blackout dates apply. Subject to availability.
of Jewish and Israeli history and politics 3ULFHVDUHSHUSHUVRQDQGDUHEDVHGRQWZRSHRSOHVKDULQJDGHOX[HURRPIRUQLJKWVDQGLQFOXGHÀLJKWVZLWK%ULWLVK$LUZD\VDOOPHDOVSUHPLXPGULQNV
all land and water sports, transfers, tips and taxes. Prices are subject to change & availability and are correct at time of print. ^Based on lead-in room
FDWHJRU\ ÀLJKWFODVV
CONTINUE ON PAGE 24
 24 Lifestyle | Gadgets and Travel
CONTINUED FROM PAGE 23
books. Olivia selects an amusingly incon-
gruous accompaniment to our decadent
beach-lounging and bar-hopping: the con-
troversial Invention of the Jewish People
by raging left-winger Shlomo Sand. But
then, this is a city of contrasts, with both a
highly evolved culture of hedonism and a
populace that is cynical, and often in
denial, thanks to seemingly insoluble exis-
tential angst and threat. Parties on one
hand, grave danger on the other.
Night-time brings what I look forward
to most in Israel: eating (although break-
fast is also a source of wonder. Try
Benedict, on Rothschild 29 and 171 Ben
Yehuda, and the Breakfast Club on
Rothschild 6, for perfect pancakes, bulgar
wheat with pomegranates, or full Israeli
breakfast of eggs, tahina, fresh bread and
salad.). Tel Aviv’s main market, Carmel,
heaves with fruit and vegetables the
colour of cartoons, as well as spices and
herbs that can lift any salad to a paradisal
Boutique chic comes to Jerusalem
W
HO can begin to describe
Jerusalem? The religious centre
of the Western world and much
of the East, it is Tel Aviv’s polar
opposite. Tel Aviv has a beach, Jerusalem
has mountains. Tel Aviv has a party atmos-
phere; Jerusalem has a studious one
(though you can still stay out to 4AM any
night of the week quite happily). Yeshiva
students and the ultra orthodox dominate
the streets; the Via Dolorosa, Western Wall
and Church of the Holy Sepulchre is their
stomping ground and that of the Arabs
who share the city.
But we’re not here to worship or study.
We’re here to stay at Israel’s second design
hotel (the first is the beautiful, always-
booked Montefiore in Tel Aviv) and
Jerusalem’s first – the Mamilla.
It is a remarkable hotel and well worth
the flight alone. Built from pale Jerusalem
stone, it encroaches on the Mamilla Mall,
a long stone passageway with shops and
cafes that leads to the walls of
the Old City. From many
of the rooms – and the
hotel’s rooftop bar –
you have a perfect
view of the Old
City. I can report
that a martini
goes extraordi-
nary well with a
night-time view
of the Dome of
the Rock.
Like almost
every hotel, restau-
rant and café in
Jerusalem, the Mamilla
is completely, 100 per cent
kosher and Orthodox Jewish-
approved. We arrived on a Friday night,
the beginning of the Sabbath, to be con-
fronted with a programme of religious
services, songs and special lifts that stop at
every floor to prevent having to press any
buttons (this counts as anti-Sabbath
exertion).
Meat and dairy cannot be combined in
a kosher kitchen, so separate meat and
dairy restaurants are the norm in super-
religious Jerusalem. The elegant Mamilla
Café is dairy and we had some delicious
salads and cakes there – overlooking the
Mall from a flower-strewn terrace and
white-tiled tables. There are a few other
restaurants in the hotel too – you can
snack at the rooftop and Mirror bars, dine
in the Dining Room, and sneak a coffee at
the Espresso Bar. In short, you won’t go
hungry at the Mamilla (or in Israel).
The intriguing thing about the Mamilla
is the way orthodoxy meets world-class
boutique elegance. It is a wonderful meet-
ing of old and new. Designed by superstar
Israeli architect Moshe Safdie, light and
space and stone dominate all the central
areas, which are given life and colour with
plush, expensive furniture. There’s a
CITYA.M. 24 JANUARY 2011
European
Nintendo leaps
realm. One restaurant, Carmela B’Nachala
(Hatavor 46), sits on Carmel’s fringes to
social norms better absorb its fresh produce, and the
meal I once had there is still in my all-time
are all but top five dinners. The herb salad will forev-
ahead with 3DS
er stay with me.
meaningless The ultimate culinary find this trip was
Abraxis North (40 Lilenblum St), where we
in Israel. crooned and swooned over a single perfect
roast sweet potato, head of roast cauli-
Impromptu flower and mountain of tomatoes (the
chef is famous for his love of tomatoes).
midnight Next day, we went to Jaffa and explored
a beautiful Palestinian art show in a ware-
dinners or house by the harbour – just one of hun-
dreds of shows in this hyper-creative city at
3AM snacks any one time. We wished we had time for
the Tel Aviv Museum of Art, a tour of the
GEEK
of perfect Bauhaus architecture for which the city is
known, and a dance show at the world-
SPEAK
bourekas famous Susan Delal Centre.
My advice is this: try not to sleep. It’ll Steve Dinneen
are the norm help you make more headway into the
bank of pleasure and culture the city is
built on.
A
FTER being surrounded by the latest in 3D technology for a
week at the Consumer Electronics Show in Las Vegas, the
sight of two-dimensional images – a video of a puppy playing,
for example, or a photograph of a friend’s newborn baby –
now makes me uncontrollably and violently sick. Watching standard
2D TV is like peering through the analogue haze at the Queen’s coro-
nation footage from 1952, while wearing a blindfold. I have even built
a pyre in my garden, upon which I plan to throw my old Xbox 360 and
PlayStation 3 games, casting the outdated technology to the flames
where it belongs.
Thank the lord, then, that Nintendo is almost ready to launch its
much-hyped 3DS. The portable console will hit the UK on 25 March,
after an embarrassing delay that resulted in the firm missing the
lucrative Christmas market, and while they haven’t let me get my
hands on one yet, what I have seen so far looks impressive.
I got a chance to play with some of the first portable glasses-
free 3D gadgets at CES and the depth that even a small screen can
achieve is astonishing. Judging by the demos Nintendo showed off
last week, this translates nicely to its trademark cartoony games.
The dual-screen device is also packing motion and gyro sensors
(although these clash with the 3D technology, which demands the
device is held still, meaning you have to go into 2D mode to take advan-
tage of them), and Nintendo has introduced its own version of the App
Store, allowing it to cash in on the trend for casual and retro games.
The Japanese firm has already unveiled a host of launch
titles, including new versions of Street Fighter and Pro
swimming pool in the basement, too, Above: the Mamilla’s Evolution Soccer. So far so good. The catch is the £229
which – though dark – is sensually attrac- rooftop bar overlooking price tag. Will gamers be willing to shell out such a hand-
tive with leaf designs on the dark blue the Old City. Left: part some sum for a portable device (more than a standard
walls and dark wood decks. of the hotel’s high Xbox360 console)? I doubt it. Expect prices to fall after
Our room was spacious and minimalist, ceilinged foyer. Below: a hardcore fans have finished flashing the cash.
with half-moon shaped windows looking bedroom. One thing for sure is the new PlayStation Portable 2
out on the Mamilla Café and, beyond (PSP2), which is set to be unveiled sometime this week,
that, the Old City. Israeli sparkling has a lot to live up to. Sony has already confirmed it will
and red wine met us in the not feature a 3D screen, meaning it will either have to be
room – and the earth-toned very powerful or very cheap to compete (the PSP has
bathroom was delicious. already struggled against the DS, selling just 18m units in
Not that we spent much the US compared to Nintendo’s 47m).
time there – we had the With games on mobile phones advancing at a remarkable
Old City to see, sheeshas pace, this could well be the last great battle of the stand-
to smoke, the stunningly alone portable consoles. Apple’s iPhone and iPod Touch are evolving into fully-fledged
refurbished Jewish gaming machines in their own right and Sony is set to launch its own PlayStation
Museum to visit (newcom- phone. But for now, clever money is on Nintendo to come out victorious.
ers to the city should see
the definitive Holocaust
Museum, Yad Vashem) and WHITE BLACKBERRY TORCH/iPHONE
bars to hit (there are numer- As Apple boss Steve Jobs – the man who drove a stake through the
ous and busy hangouts on the heart of the beige PC – knows too well, colour is important. And in the
Mamilla’s doorstep). mobile phone world, white is very much in this season. First up is a new
One of these bars was the hotel’s version of BlackBerry’s flagship Torch handset. The white 9800 will be
own Mirror Bar, with a disco feeling, dark much the same as its monochrome sibling, only brighter, presumably for
lights, plush seats, lots of glitter, a DJ people wanting to be noticed typing their incredible important emails on
blasting chart hits and an enter- the underground. Not to be outdone, Apple is set to respond with its very
taining mix of orthodox Jews own white version of its iPhone 4.
on the pull; businessmen let-
ting their hair down and –
well, us. HYDRA (RAZER)
The spa, Akasha, High definition 3D screens are grabbing the headlines. But for gamers,
looked beautiful but three dimensions are becoming de rigueur off screen too. We got our
had yet to open on our hands on Razer’s latest motion sensing controller, the Hydra. The unit fea-
visit. Now open, all the tures two separate hand-held devices which are tracked by an electro-
Mamilla needs is for the magnetic field, doing away with the need for a motion sensing camera.
snooty service at the This allows gamers to interact with the screen with incredible precision
front desk – we were not and pull off seemingly complex moves with relative ease. For now, the
met with the efficiency Hydra will only work with Valve’s upcoming title Portal 2 (which is out
nor the helpfulness suit- soon on Xbox 360, PlayStation 3, and PC), but something this good will
ing a hotel of this calibre – surely be rolled out across other titles soon.
to be sorted out.
Jerusalem can already lay
claim to having one of the world’s iPAD 2
most stylish and interesting hotels. I hope More than 80 tablets were unveiled at the Consumer Electronics show
the rest of Israel follows suit. earlier this month but none managed to knock the iPad from its perch.
From US$390 for a double room, incl breakfast Now the competition may just have got even tougher, with rumours that
(www.mamillahotel.com). In Tel Aviv, Zoe stayed the latest version of the all-conquering device could hit stores as soon as
at the Dan, which has double rooms starting at next month. The iPad 2 is expected to feature front and rear facing cam-
US$180, incl breakfast (www.danhotels.com). She eras and our money is on a more sophisticated multi-tasking system akin
flew with El Al, which operates twice daily flights to that on the impressive BlackBerry Playbook. At the risk of going out
from London-Tel Aviv (apart from Fridays) from on a limb, we think this will be the gadget to own this year.
£265 return. www.elal.co.il
CITYA.M. 24 JANUARY 2011 Lifestyle | TV& Games 25

BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5 TV PICK

TERRESTRIAL
6pm BBC News
6.15pm BBC London News
7pm The One Show
7.30pm Inside Out: BBC News
8pm EastEnders
8.30pm Stop Stalking Me:
Panorama
9pm CHOICE Silent Witness
10pm BBC News
10.25pm Regional News
10.35pm A Question of Sport
11.05pm Late Kick Off
11.35pm The Graham Norton
Show: Weatherview
12.25am Sign Zone: Giles and
Sue Live The Good Life
1.25am Sign Zone: Ancient Worlds
2.25am Sign Zone: Filthy Rotten
Scoundrels 3.10am-6am BBC New
6pm Eggheads
6.30pm Great British Railway
Journeys
7pm Escape to the Country: Two
hoteliers look for a retirement
home in Leicestershire.
8pm University Challenge
8.30pm CHOICE Baking Made
Easy
9pm Horizon: Science Under
Attack: Why public trust in key
scientific theories seems to
have been eroded.
10pm Episodes
10.30pm Newsnight: Weather
11.20pm An Island Parish
11.50pm The Planets
12.40am BBC News
3.10am-6am Close
6pm London Tonight
6.30pm ITV News
7pm Emmerdale
7.30pm Coronation Street
8pm The Lakes
8.30pm Coronation Street
9pm The Biggest Loser: The
remaining contestants have to
work together as a team.
10pm ITV News at Ten
10.30pm London News
10.35pm The Zoo
11.35pm That Sunday Night
Show
12.05am Grimefighters
12.30am The Zone; ITV News
Headlines
2.35am The Jeremy Kyle Show
3.30am-5.30am ITV Nightscreen
6pm The Simpsons 6pm CHOICE Home and Away
6.30pm Hollyoaks 6.25pm Live from Studio Five
7pm Channel 4 News 7pm Five News at 7
7.55pm 4thought.tv 7.30pm How Do They Do It?;
8pm Birth of Britain: How ice Five News Update
ages have shaped modern 8pm Emergency Bikers: Five
Britain. News Update
9pm One Born Every Minute: 9pm FILM Layer Cake: Thriller,
A mother-to-be who was born starring Daniel Craig. 2004.
with a major heart defect goes 11.10pm FILM Death Wish 2:
into labour. Thriller sequel, starring Charles SILENT WITNESS
10pm Alan Carr: Chatty Man BBC1, 9PM
Bronson. 1981.
11.05pm The Joy of Teen Sex 12.55am SuperCasino Harry travels to Budapest to help his
12.10am Premier League Poker 4.05am Rory and Paddy’s Even lover Anna Sandor investigate a death,
1.10am Mosley 2.15am The Genius Greater British Adventure but when she is killed, he finds himself
of British Art 3.10am Titanic: 4.55am Rough Guide to Beaches: implicated in her murder.
The Mission 4.05am The Untold Breaks in Thailand, Morocco and
Battle of Britain 5am ER 5.45am- Kenya 5.10am Wildlife SOS
6.10am Yo Gabba Gabba! 5.35am-6am House Doctor

SKY SPORTS 1 1am WWE: NXT 2am Live 12am CSI: Crime Scene 3.25am The Loop 3.50am Life 4.40am Rory McGrath’s Best
SATELLITE & CABLE

7pm Live Monday Night
Football 10.30pm The Sky
Sports Years 11.30pm
Netbusters 12am SPL Round-
Up 12.30am Monday Night
Football 2.30am Sports
Unlimited 3.30am Watersports
World 4.30am Max Power
5.30am-6am Netbusters
SKY SPORTS 2
7pm Bass Fishing 8pm NFL
10pm Extreme Carp 10.30pm
Soccer AM: The Best Bits
11.30pm Bass Fishing
12.30am European Tour Golf
1.30am PGA Tour Golf 2.30am
Wonderful World of Golf 4am-
5am PGA Tour Classic
SKY SPORTS 3
7pm Show Jumping 8pm
Extra Time 8.30pm Wild
Spirits 9pm Squash 10pm
WWE: NXT 11pm WWE: Late
Night – Bottom Line 12am
WWE: Late Night – Afterburn
WWE: Late Night – Raw
4.15am-5.15am Squash
BRITISH EUROSPORT
5.30pm Caribbean Twenty20
Cricket 8.30pm Australian
Open Tennis 11.30pm Game,
Set and Mats 12am-6am Live
Australian Open Tennis
ESPN
6.30pm Talk of the Terrace
8pm NHL 10pm Between The
Lines 10.30pm Pardon the
Interruption 11pm ESPN Game
of the Week 11.30pm FA Cup
Preview Show 12am Live
Basketball 2am Live Basketball
4am ESPN Press Pass 4.30am
Between The Lines 5am-6am
European Rallycross
LIVING
7pm Ghost Whisperer 8pm
Nikita 9pm America’s Next Top
Model 10pm Four Weddings
US 11pm Criminal Minds
Investigation 2.50am
Charmed 4.30am Four
Weddings 5.20am-6am Maury
BBC THREE
7pm Michel Roux’s Service
8pm Hotter Than My Daughter
8.30pm Snog, Marry, Avoid?
9pm Laura Hall: My Battle
with Booze 10pm EastEnders
10.30pm Being Human
11.30pm Family Guy 12.20am
Laura Hall: My Battle with
Booze 1.20am Hotter Than
My Daughter 1.50am Snog,
Marry, Avoid? 2.20am Being
Human 3.20am Ready Steady
Drink 4.20am-5.20am Michel
Roux’s Service
E4
7pm Hollyoaks 7.30pm Friends
9pm Glee 10pm Tool Academy
11.05pm Rude Tube 12.05am
Scrubs 1am RuPaul’s Drag
Race 1.50am Rude Tube
2.45am Beauty and the Geek
Unexpected 4.30am-6am of British Engineering 5.30am-
Switched 6am How Does That Work?
HISTORY DISCOVERY HOME &
7pm Heir Hunters 8pm HEALTH
America: The Story of the US 7pm A Baby Story 8pm 10 BAKING MADE EASY
9pm Pawn Stars 10pm Years Younger 9pm Real ER: BBC2, 8.30PM
American Pickers 11pm The The Bronx 10pm Untold Lorraine Pascale turns her attention to
True Story 12am Pawn Stars Stories of the ER 11pm modern classics, preparing macaroni
1am American Pickers 2am Chicago Medical 12am Real and cheese, Swiss roll and focaccia, as
America’s Toughest Jobs 3am ER: The Bronx 1am Untold well as sharing tips on food presentation.
Life After People 5am-6am Stories of the ER 2am Chicago
Deep Sea Detectives Medical 3am 10 Years Younger
4am Bringing Home Baby
DISCOVERY 5am-6am A Baby Story
8pm How Do They Do It?
8.30pm How It’s Made 9pm SKY1
Aircrash Confidential 10pm 8pm Road Wars 9pm Dream
Out of the Wreckage: Plane Lives for Sale 10pm Mental
Crash Survivors 11pm 11pm Inside: The Prison Code
Surviving the Cut 12am Bear 12am Road Wars 1.50am
Grylls: Born Survivor 1am Miami SWAT 2.40am 99 Most HOME AND AWAY
Deadliest Catch 2am Bizarre: Weird and outlandish CHANNEL 5, 6PM
Mystery Investigator: Olly crimes. 3.30am The 4400 Marilyn tries to say goodbye to the
Steeds 3am How the 4.20am Don’t Forget the Lyrics people of Summer Bay, and April’s plan
Universe Works 3.50am 5.10am-6am Are You Smarter to get Liam and Bianca back together
More Industrial Revelations Than Your 10 Year Old? is thwarted by her mother’s arrival.

COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk

QUICK CROSSWORD
   

SUDOKU KAKURO
21 38 15 16 20 13
13 5 6
17 24   
35 23
Place the numbers from 1 to 9 in each empty cell so that each 14 
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 45
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 8 4 8
   
above or to the left of it. 12
You can only use the digits 1-9 5 21
    and you must not use the
11 20 22 39
30 10     
same digit twice in a block. 34
   The same digit may occur 10 7 
11 27
    more than once in a row or
column, but it must be in a
14
19
17
6 4
15
 
45
  separate block.
6 15
    16 12 13


  ACROSS DOWN
2 Entrance used by 1 Section of
   
   WORDWHEEL M S
performers and other
theatre personnel (5,4)
6 Spokes (5)
writing (9)
2 Grasslike marsh
plant (5)
Using only the letters in the Wordwheel, you have 7 Animal similar to 3 Relating to
    ten minutes to find as many words as possible,
I A the giraffe (5) birds (5)
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters S 9 Diving bird of
northern seas (3)
4 Call forth (5)
5 Transmitting
LAST ISSUE’S or more, all must contain the central letter and
letters can only be used once in every word. There
P E 10 John ___, pioneering live (2-3)

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

I V
US astronaut (5)
12 Small heron (5)
8 Lacking
information (2,3,4)
14 Declares or affirms 11 Immediately (3)
QUICK CROSSWORD 5 2 1 6 8 9 5 7

B A N T A M M C
8 5 6 7 3 9 4 1 2 SUDOKU         
as true (5)
17 Sun-dried brick (5)
13 Wander aimlessly
in search of
9 8 2 1 4 3 1
I U A R M A D A         
L A T R I N E D P
7 1 9 4 19 The type of wind that pleasure (3)
        
L B I N C O M E 3 8 2 3 6 2
        
blows no good (3) 15 Further from
S I R O C C O N R 1 4 2 7 6 3 2 1 20 Despised (5) the centre (5)
        
T
E T A
S P
W
A N
I N
C A K E
8 6 6
7
9
4
9 5
9 3
WORDWHEEL          21 Board used as a 16 Move furtively (5)
W A P I T I E V
2 8 3 9 8 4 2 The nine-letter word was          planchette (5) 17 Not silently (5)
I I O R G A N Z A
R E T I R E G N 4 9 3 2 8 5 6 7 1          22 Employee who mixes and 18 Flexible twig of a
3 5 2 1 4 9 8 7
TURNSTILE         
L E R H E S U S serves alcoholic drinks (9) willow tree (5)
 Sport
26 CITYA.M. 24 JANUARY 2011

FOOTBALL ROUND-UP

Levy: Stadium
Ancelotti still trusts
Chelsea’s old guard
decision must be
CHELSEA manager Carlo Ancelotti
insists the club’s older players are not
past their sell by date.
The champions’ recent poor form

head over heart

has in part been attributed to a reluc-
tance by Ancelotti to provide competi-
tion his established stars.
Ahead of tonight’s testing trip to
Bolton, he said: “I think the players
remain motivated because when you
win, the next desire after the victory
is to win again. This was in my mind
and in their mind.”

Tottenham, who plan to demolish ries of Usain Bolt or Jessica Ennis’.

▲

Blackburn boss Kean OLYMPIC STADIUM

BY FRANK DALLERES
to praise Robinson
BLACKBURN moved up to seventh in
the Premier League after a 2-0 home
win over relegation-haunted West
Brom at Ewood Park.
An own goal from Gabriel Tamas
and a cracker from David Hoilett
either side of half-time sealed the
points, but former England goalkeep-
er Paul Robinson was the star of the
show with a string of fine saves.
Rovers manager Steve Kean said:
“He was absolutely outstanding. He’s
really at the top of his game now.”
Warnock marvels at
TOTTENHAM chairman Daniel Levy has
urged London 2012 legacy chiefs to ignore
“emotive” rhetoric and focus on facts as
they prepare to decide between bids from
Spurs and West Ham for the Olympic
Stadium.
Levy spoke out yesterday as West Ham
vice-chairman Karren Brady compared
Tottenham’s proposals to bulldozing 100
primary schools, and Lord Coe warned that
Britain’s international reputation would be
“trashed” if Spurs were allowed to move
into the venue after next year’s Games.
“Strip out the emotion, take a step back
and ask what’s best for athletics,” said
Levy. “It’s surely to have a dedicat-
ed facility that’s available all
year round rather than 20
days a year.
“There are all these emo-
and rebuild the Olympic Stadium
without a track, propose to
deliver the legacy by redevel-
oping the run-down facilities
at Crystal Palace instead.
Brady (below) criticised
her Premier League rivals’
ambitions, saying: “It’s such
a crying shame that it [the
stadium] has been built on the
back of a promise made in the
Queen’s name, and is then going
to be pulled down.
“And Spurs’ bid frankly is equivalent to
building 100 new primary schools and then
bulldozing each and every one of them just
four weeks after they’ve been built. I
just fundamentally don’t believe
in that.”
Coe (above), who led the
delegation in Singapore six
years ago that successfully
“It is the legacy we took to
Singapore and I really think we
have to be very, very careful
about how we are prepared
to potentially trash our
international reputation
here.”
The Olympic Park Legacy
Company is expected to
decide between the two bid-
ders when its board meets on
Friday and Levy responded: “I
don’t buy the argument of having
somewhere to take your grandchild to rem-
inisce on London 2012, what I buy is a dedi-
cated facility which will always be the
home of athletics.”

Taarabt masterclass tive words being used. Let’s

QPR boss Neil Warnock claimed Adel
Taarabt is good enough for Real
Madrid after a 2-1 win over Coventry.
“My son bought his mate just to
see Taarabt. He thinks he should be
playing for Real Madrid. He could,
but first of all he’s got to help me,”
said Warnock, whose side are top of
the Championshp by five points.
deal with fact rather than
emotion. This word
‘promise’ that has been used
is such an emotive word.”
West Ham intend to retain the
running track if they move into the
£537m stadium, thereby fulfilling the
promise of an athletics legacy for east
London made by Coe when he and his team
bid for the capital to host the Games.
argued for London to stage
the Games, said Britain had
“a moral obligation” to
adhere to their bid mani-
festo.
“I just find it inconceivable
that grandparents are going to
take children back to possibly a Premier Crystal Palace plan to return to their
League football ground, amongst the tier of original home which may impact on
sponsorship boxes, and say, ‘Actually some- Spurs and West Ham Pictures: PA, REX
where in all this lies dormant the memo-

United rebuff talk of £2bn

takeover by Qatar Holding
▲

FOOTBALL
BY FRANK DALLERES
MANCHESTER UNITED insist the club
is not for sale and have denied sugges-
tions that the Glazer family, which
owns the club, has held talks with a
Qatari consortium over a potential
£2bn takeover.
Qatar Holding, the £40bn invest-
ment company owned by the Gulf
kingdom’s royal family, is thought
to have had a £1.5bn offer for the
Premier League leaders rebuffed
anyway because it is not for sale.”
A spokesman for Qatar Holding,
which bought Harrods for £1.5bn last
year and owns stakes in Barclays and
the London Stock Exchange, declined
to comment on a bid for United when
contacted yesterday by City A.M.
Rumours of Qatari interest in
United, one of the most valu-
able brands in sport,
emerged 12 months ago
when the club visited
the emirate for a mid-
season sunshine break.
TIMELINE | QATAR AND MAN UTD
Jan 2010 United visit Qatar for a sunshine
training break, sparking speculation of interest
Prior has been dismissed for two ducks in two innings Picture: ACTION IMAGES
in the club from the mega-rich emirate
Nov 2010 Having previously derided Qatar as
“some unknown country”, United boss Sir
Alex Ferguson visits Qatar to speak, for free,
Struggling Prior needs more time
at a sport conference, where he endorses
their bid to host the 2022 World Cup
to adapt to opening, says Strauss
Nov 2010 Glazers pay off costly PIK loans,
fuelling rumours they’re preparing to sell the scorers in each of his innings since
▲

by the Glazers. Speculation resur-
The American family, led by faced in December as
Malcolm Glazer (right), who Qatar announced its arrival
bought United in 2005 for on the global football stage,
£790m but have grown first by controversially win-
unpopular with the club’s ning the vote to stage the
fans, are said to want 2022 World Cup and then by
nearer £2bn. agreeing a £125m shirt
A United spokesman sponsorship deal with
said: “There has been no Spanish champions
approach of any kind to Barcelona, through its
buy the club and one non-profitable arm,
wouldn’t be welcome the Qatar Foundation.
Nov 2010 The following day it emerges the
Glazers’ long-standing spokesman, Tehsin
Nayani, is to leave his post, with no plans to
recruit a replacement
Jan 2011 United chief exec David Gill, on a trip
to the Gulf, says Premier League clubs want a
winter break. Ferguson says he is in favour of
switching the season to the summer. It comes
amid talk of European leagues rearranging
calendars to aid a winter World Cup in Qatar
CRICKET
BY JAMES GOLDMAN
ENGLAND captain Andrew Strauss
insists Matt Prior will remain at the
top of the order despite successive
ducks as Australia moved 3-0 ahead in
the best of seven ODI series yesterday.
Test gloveman Prior was recalled to
the 50 over set-up last week, at the
expense of Steven Davies, following a
near three-year absence, just in time
for World Cup selection.
Prior has, however, failed to trouble
his return to the side as England con-
tinue to struggle to find the right
opening combination.
But after the comprehensive four-
wicket defeat in Sydney, Strauss
remained adamant that Prior is the
right man for the job.
He said: “I don’t think [it will
change] I think I will be opening with
him,” Strauss said. “We’ve got to give
him an opportunity to get used to the
role again. We’re still happy with his
capabilities at the top of the order.”
CITYA.M. 24 JANUARY 2011 27

Lemi’s winner proves a mere consolation

as Wasps are left to regret Glasgow defeat
RFU warn Johnson:
WASPS 21
Top two Six Nations
TOULOUSE 16 finish is a minimum
▲

RUGBY UNION
BY JAMES GOLDMAN

WASPS director of rugby Tony Hanks
admits his side have been left with a
sense of ‘what could’ve been’ after
they crashed out of the Heineken Cup
despite a last-gasp win over reigning
champions Toulouse at Adams Park.
In front of a record home crowd
(10,014) at the Wycombe venue David
Lemi’s last-minute try secured a
deserved victory, but hopes of pro-
gression to the quarter-finals had
already been dashed prior to kick-off
when news of pool leaders Leicester’s
win over Perpignan filtered through.
Victory at least ensured Wasps
qualified as top seeds for the quarter-
finals of the Amlin Challenge Cup,
where they will travel to Harlequins,
but it could not mask their sense of
regret following last weeks surprise
and damaging defeat against
Glasgow.
“There will be plenty of times over
the next two months, particularly
when we see Toulouse play in the
quarter-finals, when we will think
‘what could have been’ but we have to
move on,” Hanks said.
“At least we fronted up and the
guys can look in the mirror and be
proud of the performance.
“Everyone really hurt this week.
The first few days [after the Glasgow
defeat] were horrible but rather than
turn up today sulking about it, we
attempted to repay our supporters.”
Northampton land Ulster draw and it’s Leinster for Leicester
TOP SEEDS Northampton will host
Irish province Ulster in the quarter-
finals of the Heineken Cup.
The Saints, who won all six of their
group matches, will have home
advantage if they reach the semis,
but may have to switch the venue of
their last-eight tie away from
Franklin’s Gardens to a venue with a
▲
RUGBY UNION
BY JAMES GOLDMAN
RFU chief executive John Steele has
warned England manager Martin
Johnson that anything other than a
top two finish in the upcoming Six
Nations tournament would rank as a
major disappointment.
Johnson’s side have progressed
well over the last year, posting
impressive back-to-back home and
away wins over Australia, and Steele
is keen for the side to lay down fur-
ther markers ahead of September’s
World Cup.
“Given we have three home games
Lemi’s try sunk and some momentum from the
Toulouse in front autumn we believe finishing in the
of a record home top two is realistic,” said Steele.
crowd “Third or below would be disappoint-
Picture: GETTY ing given our current position.”
capacity in excess of 15,000. Leicester Leinster v Leicester
travel to face 2009 champions Perpignan v Toulon
Leinster, Perpignan play Toulon and Biarritz v Toulouse
Biarritz host Toulouse in two all- * Ties to be played 8/9/10 April
French ties – the latter a repeat of last
year’s final. Heineken Cup semi-finals:
Leinster/Leicester v Biarritz/Toulouse
Heineken Cup quarter-finals: N’hampton/Ulster v Perpignan/Toulon
N’hampton v Ulster * Ties to be played 30 April/1 May

Schiavone earns SPORT | IN BRIEF

Kaymer cruises to Abu Dhabi title
Results
=FFK98CC
98I:C8PJGI<D@<IC<8>L<
GFFC*
Dlejk\i%%%%%%%%%%%%%%%%%%%%%%%%%%%%)/ Cfe[fe@i`j_%%%%%%%%%%%%%%%%%%%%%(+
Fjgi\pj%%%%%%%%%%%%%%%%%%%%%%%%%%%%%)0 Kflcfe%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%(.

historic triumph
GOLF: Germany’s Martin Kaymer is up
to No2 in the world after he won his
third Abu Dhabi title in four years by
eight shots from Northen Ireland’s Rory
McIlroy. The 26-year-old leapfrogged
Tiger Woods in the rankings after finish-
ing the tournament on 24-under par,
Elsewhere in Melbourne 2008 having made just one bogey all week.
▲
8ij\eXc%%%%%%%%%%%%%%%%%%%(  * N`^Xe%%%%%%%%%%%%%%%%%%%%%%%%'  '
8jkfeM`ccX%%%%%%%%%%%%%(  ( DXe:`kp%%%%%%%%%%%%%%%%%%%%'  '
9cXZbgffc%%%%%%%%%%%%%%'  ( Jle[\icXe[%%%%%%%%%%%%%%% )  )
<m\ikfe%%%%%%%%%%%%%%%%%%'  ) N\jk?Xd%%%%%%%%%%%%%%%%%%%(  )
=lc_Xd%%%%%%%%%%%%%%%%%%%%(  ) Jkfb\%%%%%%%%%%%%%%%%%%%%%%%%%%'  '
DXeLk[%%%%%%%%%%%%%%%%% *  , 9`id`e^_Xd%%%%%%%%%%%%%%'  '
E\nZXjkc\%%%%%%%%%%%%%'  ( Kfkk\e_Xd%%%%%%%%%%%%%%%%%'  (
Nfcm\i_Xdgkfe%%%'  ' C`m\igffc%%%%%%%%%%%%%%%%%%%%(  *
9cXZbYlie%%%%%%%%%%%%%%%(  ) N\jk9ifd%%%%%%%%%%%%%%%%'  '
  G N ; C 9 = 8 Gkj
Kflcfe%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- + ' ) ( (+* (*+ (.
Dlejk\i%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- * ' * + (+* ()) (-
Fjgi\pj%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- * ' * ) ((. ((* (+
Cfe[fe@i`j_%%%%%%%%%%%%%%%%%%%%%%%%%- ) ' + ( ('. (+( 0
GFFC+
8`ife`Il^Yp%%%%%%%%%%%%%%%%%%%%%%%- Lcjk\i%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%+*
9`Xii`kq%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%)- 9Xk_%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%% (0

TENNIS KFGJ@O  G N ; C = 8 >; Gkj

BY FRANK DALLERES
SIXTH seed Francesca Schiavone
hailed “one of the most emotional
moments of my life” after beating
Svetlana Kuznetsova to win the
longest women’s match in grand
slam history at the Australia Open.
Schiavone beat Kuznetosova 6-4, 1-
6, 16-14 in a contest that lasted four
hours and 44 minutes – 25 minutes
more than the previous longest in
the open era. It put the Italian into
the quarter-finals, where she
will face the top seed,
Caroline Wozniacki.
“It is a fantastic
moment for me,” said
Schiavone, the French
Open champion. “It is
one of the most emo-
tional moments of
my life. I just told
myself to keep going,
do it with the heart and
go for it.”
champion Maria Saharapova suffered
a fourth-round defeat in straight sets
to 30th seed Andrea Petkovic.
Eighth seed Andy Roddick was the
major casualty in the men’s draw yes-
terday, losing 6-3, 6-4, 6-4 to 19th seed
Stanislas Wawrinka.
The comprehensive win
means Wawrinka will face
compatriot and defending
champion Roger Federer in
the last eight – the first all-
Swiss men’s grand slam
quarter-final in history.
Second seed
Federer recovered
from a fright to beat
Spain’s Tommy
Robredo 6-3, 3-6, 6-3,
6-2. Novak
Djokovic, the
third seed,
progressed
with a crushing 6-3,
6-4, 6-0 defeat of Nicolas
Almagro.
Lee Westwood and Kaymer now occupy
the top two spots, meaning Europe can
boast the best golfers on the planet for
the first time since 1993 when Nick
Faldo and Bernhard Langer ruled the
roost. “Hopefully I can stay there for a
while,” said Kaymer. “It is definitely nice
to take over from the player who, for
me, is the best in the world.”
Hurricane Fly too good for Solwhit
HORSE RACING: Hurricane Fly, the 4-9
favourite, won the Irish Champion
Hurdle at Leopardstown from Solwhit.
The Paul Townend-ridden winner
secured his fourth victory over his old
rival. The 2010 winner Binocular
remains 3-1 favourite for the Champion
Hurdle, with Hurricane Fly about 7-2.
South Africa secure series win
CRICKET: Hashim Amla struck an unde-
feated century as South Africa secured
a 3-2 series win over India thanks to a
33-run win on the Duckworth/Lewis
method in the fifth ODI in Centurion.
DXeLk[%%%%%%%%%%%%%%%%%%%%%%%%%)) (* 0 ' +/ (0 )0 +/
8ij\eXc%%%%%%%%%%%%%%%%%%%%%%%%%%%%)* (+ + , +/ )) )- +-
DXe:`kp%%%%%%%%%%%%%%%%%%%%%%%%%)+ (* - , *. )' (. +,
:_\cj\X%%%%%%%%%%%%%%%%%%%%%%%%%%%%)) (( , - */ (0 (0 */
Kfkk\e_Xd%%%%%%%%%%%%%%%%%%%%%)* (' / , *) )- - */
Jle[\icXe[%%%%%%%%%%%%%%%%%%%)+ 0 (' , )/ )+ + *.
EGFN<I:?8DG@FEJ?@G
9Xiejc\p%%%%%%%%%%%%%%%%%(  ( JnXej\X%%%%%%%%%%%%%%%%%%%%'  (
:Xi[`]]%%%%%%%%%%%%%%%%%%% *  + NXk]fi[%%%%%%%%%%%%%%%%%%%%%%(  )
:ipjkXcGXcXZ\%%%%%%%'  ' 9i`jkfc:`kp%%%%%%%%%%%%%%%%'  '
;\iYp%%%%%%%%%%%%%%%%%%%%%'  ' Efkkd=fi%%%%%%%%%%%%%%%%%%'  (
@gjn`Z_%%%%%%%%%%%%%%%%%'  * ;feZXjk\i%%%%%%%%%%%%%%%%%%%(  )
C\`Z\jk\i%%%%%%%%%%%%%%% *  + D`ccnXcc%%%%%%%%%%%%%%%%%%%%%%%(  )
D`[[c\jYifl^_%%%%%'  ( Gi\jkfe%%%%%%%%%%%%%%%%%%%%%%'  (
Gfikjdflk_%%%%%%%%%%%%(  ) C\\[j%%%%%%%%%%%%%%%%%%%%%%%%%%'  )
I\X[`e^%%%%%%%%%%%%%%%%%'  ( ?lcc%%%%%%%%%%%%%%%%%%%%%%%%%%%%%'  (
JZlek_fig\%%%%%%%%%%%'  ' 9liec\p%%%%%%%%%%%%%%%%%%%%%%'  '
J_\]]Lk[%%%%%%%%%%%%%%%'  ( Efin`Z_%%%%%%%%%%%%%%%%%%%%%'  )
HGI%%%%%%%%%%%%%%%%%%%%%%%%%(  ) :fm\ekip%%%%%%%%%%%%%%%%%%%%%(  (
IL>9PLE@FE
?<@E<B<E:LGGFFC(
:Xjki\j%%%%%%%%%%%%%%%%%%%%%%%%%%%%%% () Efik_Xdgkfe%%%%%%%%%%%%%%%%%%%)*
<[`eYli^_%%%%%%%%%%%%%%%%%%%%%%%%% (+ :Xi[`]]9cl\j%%%%%%%%%%%%%%%%%%% )(
  G N ; C 9 = 8 Gkj
Efik_Xdgkfe%%%%%%%%%%%%%%%%%%%%%%%- - ' ' ( (,, /. ),
:Xi[`]]9cl\j%%%%%%%%%%%%%%%%%%%%%%%%- * ' * ) ('. ((* (+
:Xjki\j%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- ) ' + * (', ((, ((
<[`eYli^_%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- ( ' , + 0/ (,' /
email sport@cityam.com
GFFC,
C\`Z\jk\i%%%%%%%%%%%%%%%%%%%%%%%%%%%-) 9\e\kkfeKi\m`jf%%%%%%%%%%%%% (,
G\ig`^eXe%%%%%%%%%%%%%%%%%%%%%%%%%*. JZXic\kj%%%%%%%%%%%%%%%%%%%%%%%%%%%%%% ,
  G N ; C 9 = 8 Gkj
G\ig`^eXe%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- + ( ( + (0- (() ))
C\`Z\jk\i%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- + ( ( + )(, ((/ ))
JZXic\kj%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- * ' * * (+0 (0( (,
9\e\kkfeKi\m`jf%%%%%%%%%%%%%%%%- ' ' - ( ('0 )+/ (
GFFC-
E\n$>n\ek;Ë^fej%%%%%%%%%% (- >cXj^fn%%%%%%%%%%%%%%%%%%%%%%%%%%%)*
NXjgj%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%% )( Kflcflj\%%%%%%%%%%%%%%%%%%%%%%%%%%% (-
  G N ; C 9 = 8 Gkj
Kflcflj\%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- , ' ( ) (,, /, ))
NXjgj%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- + ' ) * (+, ('- (0
>cXj^fn%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%- * ' * ' ((- (+( ()
E\n$>n\ek;Ë^fej%%%%%%%%%%%- ' ' - ) .. (-( )
>FC=
89L;?89@:?J?@GLe`k\[8iXY<d`iXk\j Ç=`eXcie[
>Yi@iclec\jjjkXk\[#gXi.) 1)-+DXik`eBXpd\i>\i 
-.-,----%).)IfipDZ@cifp.(-.-,-0%).+>iX\d\
DZ;fn\cc--.'.(-.#I\k`\]>ffj\eIjX .'.(-0-+%
).->Xi\k_DXpY`e.(-.-0-0#;Xm`[Cpee-0-/-..)%
)..IX]X\c:XYi\iX9\ccfJgX .(.*-.--%
KF;8PËJ;@8IP
9XiZcXpjGi\d`\iC\X^l\
9fckfem:_\cj\X/gd %%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
PAID IN SHARES THIS MONTH?
Deposit your stock* directly into your Saxo Account and use up to 75% of its
value as collateral for margin trading and manage your entire portfolio from
ONE account.

Forex CFDs Bonds

160+ currency pairs, Spot and 9,000+ CFDs, 16 Indices, 450+ Sovereign, Government and
Forwards 700+ ETFs, 20 Commodities Corporate Bonds
Live pricing on 40 FX options Trade across 23 global Exchanges Purchase or deposit to your Saxo account
Tight spreads & leverage up to 0.10% commission Up to 95% value as collateral to trade
200 times DMA access margined products*
Excellent liquidity Real-time monitoring of positions

Futures Stocks ETFs

Trade 450+ Futures Access to 11,000 Stocks Trade 1,000+ ETFs
15 major Exchanges Trade across 23 global Exchanges Trade across 23 major Exchanges
Direct Market Access Trade from flat fee £8 Trade from flat fee £8
Online research Research & stock screener Traded & settled like stock

Complex derivative products traded on margin carry a high degree of risk Open an account today and Saxo Bank will
and are not suitable for every investor. You can lose more than your initial
rebate Stock Transfer-in fees.**
deposit and you should ensure you fully understand all the risks involved.
Contact us for more information by calling 020 7151 2100
* Subject to acceptable stock or bond and risk rating of the particular stock or bond.
** For transfer-in until 28th February 2011 up to the max. fee value £250 (or equivalent).
or discover more about our trading accounts at
www.saxobank.co.uk

2010
Saxo Bank A/S is authorised by Finanstilsynet, the Danish Financial Supervisory Authority.