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“KKR have been great part

-
ners and allowed us to invest
£1bn in the UK in the last five
years,” he added.
KKR’s Murphy (left) and Boots chair
Pessina (right) will join Walgreen’s board
PRIVATE equity firm KKR yesterday
confounded its critics by pulling off
a deal to sell 45 per cent of pharma-
ceutical giant Alliance Boots to US
firm Walgreens for an initial $6.7bn
(£4.3bn).
In three years Walgreens will have
the option to complete the takeover
and buy the remaining 55 per cent
stake. The deal will create the world’s
biggest buyer of prescription drugs,
with 363,000 employees and com-
bined sales of £71.3bn.
KKR and Stefano Pessina, executive
chairman of Alliance Boots, spent
£11.1bn – including £3.9bn of equity –
to take the European firm private in a
debt-fuelled deal in 2007, just months
before the credit crunch began.
It remains Europe’s largest-ever lever-
aged takeover and the first time a FTSE
100 firm has been taken private. At the
time critics feared that the purchase of
the firm, which runs Boots stores in
the UK, would end in tears, but KKR –
which rose to prominence in the 1980s
during its leveraged buyout of RJR
Nabisco, inspiring the Barbarians at
the Gate book and film – appears
to have proved them wrong.
Yesterday’s deal gave a return of
2.7 times its estimated £1.2bn
investment. The rest of the 2007
deal was financed through a com-
bination of debt and equity from a
consortium of banks.
“Following five years of successful
performance, both in the UK and
overseas, [Alliance Boots] is now
in a better position than ever
before,” KKR partner Dominic Murphy
said yesterday. “The partnership is
about building upon that success and
laying the foundation for future
growth.”
Shares in the private equity giant
closed up 5.3 per cent in New York as
markets reacted favourably to a deal
that will see UK-based Murphy join
the board of Walgreens.
Pessina, who will become a sub-
stantial shareholder in Walgreens,
said yesterday: “This is something
that’s truly game changing. It is about
growth, not cost reduction.”
KKR will receive part of the payment
in the form of shares and Walgreens
will have the option to purchase the
rest of the firm in three years’ time,
paying an additional $4.9bn in cash
and issue 144.3m shares for the
remaining 55 per cent stake.
Alex Gourlay, executive director of
Alliance Boots, told City A.M. that the
deal was good for both sides: “Stefano
will become a major shareholder in
Walgreens and will join Dominic on
the board of Walgreens ... We are mak-
ing sure we have good
collaboration
and equal
power.
FTSE 100 5,586.31 +95.22 DOW 12,837.33 +95.51 NASDAQ 2,929.76 +34.43 £/$ 1.57 unc £/€ M1.24 -0.01 €/$ 1.27 +0.01
MORE: Page 2, Page 6

See Page XX
Certified Distribution
30/04/12 till 27/05/12 is 132,076
NOW
Walgreens pays
$6.7bn
for
45%
2015
Walgreens has
the option to pay
$9.5bn
for the remaining
55% stake
COST SAVINGS
Year 1: $100-150m
Year 4: $1bn
COMBINED
REVENUES
$130bn
by 2016
DIVISIONS emerged at the G20
summit in Mexico last night
over plans for Europe’s bailout
funds to snap up the debt of
member states such as Italy
and Spain.
European officials briefed
that a consensus had been
reached on the need to cut
borrowing costs of troubled
Eurozone governments,
leading to reports that even
German Chancellor Angela
Merkel had shifted her stance.
But German representatives
were quick to shoot down the
idea. “There was no discussion
here in Los Cabos about any
concrete initiatives [related to
cutting costs],” an official said.
A G20 draft communique
had said euro leaders would
“take all necessary measures to
safeguard the integrity and
stability of the area”, with Italy
pushing for more debt buying.
Italian PM Mario Monti
wants the European Financial
Stability Facility (EFSF) and
European Stability Mechanism
(ESM) to be able to buy bonds
in the both primary and
secondary markets.
The ESM does not yet exist,
with the majority of Eurozone
member parliaments still to
ratify the rescue scheme.
11,000
stores across
20 countries
LONDON2012
37
…days to go
BUSINESS WITH PERSONALITY
REPORT & ANALYSIS
See Page 30
BY JAMES WATERSON
KKRCASHESIN
ASBOOTS SOLD
IN $16BN PLAN
www.cityam.com FREE ISSUE 1,656 WEDNESDAY 20 JUNE 2012
ENGLAND
TOP THE
GROUP
ENGLAND
TOP THE
GROUP
BY JULIAN HARRIS
G20 split emerges over rescue plan for Italy and Spain
MORE EUROZONE: Pages 2, 8-9

allister.heath@cityam.com
Follow me on Twitter: @allisterheath
IN BRIEF
UK and Argentina in G20 row
nPrime Minister David Cameron
yesterday spoke out again in favour of
a referendum for Falkland Islanders
over whether the country remains a
self-governing British territory. “We
want to put this issue beyond doubt.
This referendum will be something of
a game changer,” said Cameron at the
close of the G20 summit. The tension
between UK and Argentina reportedly
prompted an awkward exchange at
the summit between President
Cristina Fernandez and Cameron.
Adobe cuts its revenue outlook
nAdobe Systems, maker of
Photoshop and Acrobat software,
yesterday cut its full-year revenue
outlook as weak demand in Europe
could affect sales of the recently
launched versions of its design
software. Adobe now expects revenue
growth of six per cent to seven per
cent, implying full-year revenue of
$4.47bn to $4.51bn and an adjusted
profit of $2.40 to $2.46 per share. It
earlier forecast a profit of $2.38 to
$2.48 per share, excluding items, and
revenue growth of six per cent to eight
per cent. Adobe shares fell four per
cent to $31.65 in trading after the bell.
Assange seeks asylum in Ecuador
nWikileaks founder Julian Assange is
seeking political asylum at Ecuador’s
London embassy, the country’s
foreign minister Ricardo Patino said.
Last week the UK’s Supreme Court
refused Assange’s bid to reopen an
appeal against extradition to Sweden
over alleged sex crimes he denies.
High-tax UK losing out as
investors favour Germany
HIGH taxes, expensive workers and
a lack of decent office space is driv-
ing foreign investors away from the
UK and into Germany, according to
a damning new report published
today.
Unless major changes are made,
the UK will lose its place as Europe’s
top destination for foreign direct
investment (FDI) to Germany within
the next two years, Ernst & Young
warns.
Britain attracted 679 projects in
2011 creating nearly 30,000 jobs,
according to the annual UK attrac-
tiveness survey.
But that represents a seven per
cent fall in projects on the year, led
by a 15 per cent drop in financial
services investment, traditionally a
strong sector for the UK.
Britain attracted 17 per cent of
total FDI in Europe last year, with
Germany gaining 15 per cent – a
rapid rise as the Eurozone power-
house saw only one third of the
UK’s level back in 2009.
The report cited the bank levy and
the increasing burden of regulation
as key factors hitting investment in
financial services – with a third of
investors claiming it is vital to the
UK’s economic future to play to its
strengths.
And although chancellor George
Hedge funds bet on Bunds sell-off
as Eurozone woes weigh on Berlin
Leading hedge fund managers are betting
on a significant sell-off in German
government bonds in the coming months
after a sharp fall in yields on the debt
paper driven by a flight to safety in the
Eurozone.
One small step for the Isle of Man
The Isle of Man has become an unlikely
competitor in the space race with the
unveiling on the island last month of two
Soviet-era space stations and a team
planning a moon landing. The offshore
jurisdiction between Ireland and the UK
aims to move off-earth as it becomes a
power in space commerce after attracting
a host of pioneers.
IAG open to Bankia’s stake going to
rival
The boss of International Airlines Group,
Willie Walsh, has signalled he is receptive
to another airline buying all or part of the
stake in IAG held by Bankia, the part-
nationalised and deeply troubled Spanish
bank. He said an airline investor could be
“positive” for the company.
Santander left waiting again for RBS
to offload branches
The landmark sale of a 318-branch
business carved out from Royal Bank of
Scotland’s existing network to Grupo
Santander of Spain has been hit by fresh
delays, The Times has learnt. The latest
problems mean that the £1.65bn deal,
announced in August 2010 and at first
intended to be completed at the end of
2011 and then by the end of this year,
will not be cemented much before June
2013.
Fraudsters jailed for 35 years for
£38m VAT scam
Three men who defrauded the taxpayer
of £38m through a complex “missing
trader” scam were jailed for a total of 35
years. The gang set up a chain of bogus
companies in order to trade in EU carbon
credits and stole the Vat payments.
Sandeep Singh Dosanjh was jailed for 15
years, Navdeep Singh Gill was jailed for 11
years and Ranjot Singh Chahal for nine
years. The trio were sentenced at
Southwark Crown Court.
Penney to tweak message, but not
its strategy
JC Penney will revamp its marketing to
convince customers that they are getting
a deal, but its chief executive isn’t
backing off a strategy that has produced a
steep drop in sales this year.
Spotify offers free radio service
The music-subscription company Spotify
is joining Pandora, Slacker and Songza in
offering a free radio service for mobile
devices in the US.
WHAT THE OTHER PAPERS SAY THIS MORNING
BRUSSELS will water down moves
to force firms to rotate which
credit rating agencies they use to
evaluate their debt, it emerged
yesterday.
Yet the European parliament
also voted in favour of new
restraints on the ability of rating
agencies to downgrade its member
governments.
Under new plans, agencies will
only be able to announce changes
to sovereign debt ratings on EU
countries two or three times a
year, on pre-arranged fixed dates.
“The debt crisis in the Eurozone
has shown that credit rating
agencies have gained too much
influence, to the point of being
able to influence the political
agenda,” said Leonardo Domenici,
a European parliament member
for Italy.
Nonetheless, the parliament has
softened measures related to
companies’ use of the agencies. An
initial plan for ratings agencies to
be rotated or switched every three
years will be weakened to apply
only to very specific types of credit
and only every five years, the
source said.
The new rules may only apply to
the ratings on structured products
such as asset-backed securities – a
significant climbdown from the
EU’s originally drafted plans.
Europe to soften
rules over credit
rating agencies
Chancellor George Osborne is cutting corporate taxes to attract more firms to Britain
2
ECONOMIC CRISIS
BY JULIAN HARRIS
BY TIM WALLACE
To contact the newsdesk email news@cityam.com
A
T last, Britain’s inflation
problem is abating. Prices are
still increasing too quickly –
inflation remains at 3.1 per
cent on the retail price index and 2.8
per cent on the consumer price
index, painful as wages are growing
far less quickly. But the direction of
travel is reassuring. The Bank of
England – by luck rather than by skill
– has been saved by the collapse in oil
prices, among other factors. But let’s
not forget that since 2005, prices in
the UK are up 22.8 per cent. Since
1987, they are up 142 per cent. Since
November 2009, just 31 months ago,
prices are up 9.6 per cent – the pound
in your pocket has lost a tenth of its
value, a true scandal. Sure, inflation
is finally slowing – but that won’t
reverse the cumulative effect of the
failure of the past two and half years.
Price stability – what price stability?
EDITOR’S
LETTER
ALLISTER HEATH
Inflation falls at last –but the damage has already been done
WEDNESDAY 20 JUNE 2012
HOW BOOTS WENT RIGHT
SO they pulled it off. Stefano Pessina,
the Italian tycoon, who gambled
everything on a massive leveraged
buyout (LBO) of Alliance Boots at the
height of the credit bubble, with the
help of private equity giant KKR, has
made a fortune for his co-investors.
Those who said the deal would col-
lapse in a heap of defaulted debt – the
LBO happened in 2007, when punch
drunk lenders were fighting to hand
over cash to borrowers with no strings
attached – and destroy private equi-
ty’s reputation have been proved
wrong. Pessina has shown himself to
be one of Europe’s foremost retailers
and a great builder of businesses and
turnaround expert.
Another man also helped resusci-
tate Boots and delivered huge returns
for his own investors – Richard Baker,
the former COO of Asda who now
works for Advent, the private equity
firm, and chairs DFS, Virgin Active
and a range of other assets, including
the Nectar card.
He saved Boots when he took over as
CEO in 2003, was instrumental in the
merger with Pessina’s Alliance
Unichem (itself built out of hundreds
of acquisitions) in 2006 and only
departed the firm when it was taken
private at an exorbitant price, deliver-
ing strong returns to investors in the
then FTSE 100 company.
the Swiss-based Alliance Boots been
the acquirer, rather than the seller.
Walgreens is not exactly a great suc-
cess story back home in the US. Some
will be depressed by the fact that
Pessina ruled out a float in London.
But those folk worried about a US
takeover of the UK high street should
relax: protectionism is never the right
answer. Wal-Mart owns Asda and
there have been no problems;
Alliance Boots was already a global
firm. This is a business story as they
should all be: huge numbers, famous
brands, buccaneering, colourful char-
acters, City financiers, Barbarians
made good and a bubble-era deal
fuelled by insane cov-light lending
that actually went right in the end,
against all the odds.
Before Baker took over, the firm was
in decline; it was trying to be a gener-
al retailer with stores in the wrong
place and all sorts of other problems,
including antiquated IT and ineffi-
cient factories. It had even been over-
taken by Lloyds Pharmacy.
To many, Boots looked finished. But
the business was turned around, a
vast collection of smaller shops
rebranded as Boots and the company
bounced back. The growth continued
under Pessina and KKR’s leadership,
as the private equity firm immor-
talised in Barbarians at the Gate
proved to be a good custodian and the
Italian tycoon an excellent executive
chairman.
So for once a good news story, rather
than the usual tale of woe, failure,
hubris and disaster, and a good old
fashioned mega-deal. There are a few
caveats: it would have been nice had
L
A
U
R
A

L
E
A
N
/
C
I
T
Y
A
.
M
.
Osborne has focused on cutting cor-
poration tax, barely half of investors
surveyed said the tax regime is attrac-
tive.
Less than half believe the UK’s
labour costs are appealing, leading
the report to call for a greater focus
on developing skills in the workforce.
Furthermore, one sixth of investors
are also put off Britain by the avail-
ability of real estate.
However, investors remain positive
on the UK’s economic outlook – 86
per cent believe the country will over-
come its economic difficulties, higher
than the 81 per cent average across
Europe.
Nonetheless, that is firmly below
the 91 per cent who expect the
German economy to recover.
“Looking to Germany, investors
value its transport and logistics skills
and infrastructure and its telecom-
munications infrastructure very high-
ly,” said Ernst and Young’s Mark
Gregory.
“The UK tends to attract investors
based on softer criteria such as quali-
ty of life and political stability.”
THE FORUM: Page 22
▲ ▲
The new jobs website for London professionals
CITYAMCAREERS.com
JP MORGAN chief executive Jamie
Dimon yesterday defended his firm
against a grilling from US
politicians, insisting that the firm
has been upfront with investors on
its multibillion-dollar trading loss.
Dimon, appearing before a House
of Representatives committee, tried
to reassure irate Republicans that his
bank would never ask taxpayers to
foot the bill for a bailout.
“No, we’re not too big to fail,” said
an exasperated Dimon. “I don’t
think there’s any chance we’re going
to fail.”
JP Morgan boss
defends bank
BY HARRY BANKS
G
E
T
T
Y
UNUSUAL share price changes in UK
companies ahead of a deal announce-
ment have fallen to a decade low, but
still take place in a fifth of cases,
according to new data from the City
watchdog yesterday.
In the Financial Services Authority’s
(FSA) final annual report before it is
split into two new regulatory bodies,
it said that abnormal price move-
ments – a key measure of “mar-
ket cleanliness” – had fallen to
19.8 per cent in 2011, down
from 21.2 per cent the previ-
ous year and the lowest on
record since 2003.
The figures
suggest that
the watchdog’s
recent clamp-
down on mar-
ket leaks,
which have
seen it make
several high
profile mar-
ket abuse
prosecutions,
Abnormal share
price changes
at 10-year low
BY ELIZABETH FOURNIER
has had a positive impact.
“Over the last four years, the FSA has
changed radically its prudential super-
visory approach, fixing the deficien-
cies which became clear in the
financial crisis,” said chairman Adair
Turner.
The report also showed that employ-
ee turnover at the FSA is down –
falling from 10.8 per cent to 9.8 per
cent over the year.
Outgoing chief executive Hector
Sants was the highest paid member
of staff last year, with a total pay
package of £835,731. But he
declined his performance-related
bonus for the 15 months to the 31
March, instead donating £143,750 to
The Art Room, an Oxford-based
charity supported by the
Duchess of Cambridge.
The FSA will be split early
next year into the
Prudential Regulation
Authority and Financial
Conduct Authority.
BUDGET airline Ryanair has made a
third bid to take over Aer Lingus,
claiming its €694m (£560.6m) cash
offer is the best chance for its rival to
remain in Irish hands.
The offer of €1.30 per share
represents a 46.7 per cent premium
over Aer Lingus’s six month average.
Ryanair believes there is a better
chance of securing a deal with its
bitter rival now than six years ago,
when it failed to clinch the firm
amid competition concerns.
The carrier, which already owns
29.82 per cent of Aer Lingus, has
made no secret of its wish to buy it.
Ryanair embarks on a third bid
to take over its rival Aer Lingus
BY MARION DAKERS And chief executive Michael
O’Leary reckons yesterday’s offer
presents no problem to regulators or
shareholders. He pointed to the
recent clearance of BA’s takeover of
BMI as an example of watchdogs
allowing hard-up airlines to survive
through consolidation.
“This offer is, we believe, the best
way for Aer Lingus to continue to be
owned, controlled and managed
from Ireland for the benefit of Irish
citizens and visitors,” he said.
The firm added that the offer is a
chance for the Irish government to
get a good price for its 25 per cent
holding, given recent interest from
others including Etihad.
WEDNESDAY 20 JUNE 2012
3
NEWS
cityam.com
Ryanair already owns almost 30 per cent of Aer Lingus shares
Hector Sants will leave the
FSA at the end of June
CHINA may soon have a major stake
in one of the UK’s biggest nuclear
projects after two Chinese state
firms teamed up with Western
players to bid for the £15bn Horizon
joint venture.
Areva and Westinghouse are
believed to have picked separate
Chinese nuclear firms to help fund
bids for Horizon, which was put on
the market by RWE and E.ON in
March.
Nomura, acting for the sellers,
received several bids by the 15 June
deadline.
China is set to
fund UK nuclear
BY HARRY BANKS
INVESTMENT bank Jefferies Group
posted a lower profit yesterday on
weak equity trading volumes and
lower earnings from its underwriting
business, but the company’s bond
trading business recorded a robust
quarter.
As the first US investment bank to
report earnings, Jefferies is often
viewed as an indicator for larger Wall
Street banks such as Goldman Sachs
and Morgan Stanley.
Fixed income revenue rose 31 per
cent to $293m (£186m), while invest-
ment banking revenue fell 10 per cent
to $297m.
The midsized investment bank
earned $63.5m, or 28 cents per share,
compared with $80.6m, or 36 cents
per share, a year earlier. Revenue fell
two per cent to $711m.
Excluding items related to its acquisi-
tion of historic stockbroker Hoare
Govett from Royal Bank of Scotland
and other items, the company earned
31 cents per share.
Jefferies shares came under intense
pressure after brokerage MF Global
filed for bankruptcy in October 2011 as
investors worried that Jefferies might
have similar troubles. The company
has since taken steps to boost investor
confidence by selling billions of dol-
lars of Greek, Irish, Italian, Portuguese
and Spanish debt in a matter of days.
Jefferies profit
falls but fixed
income shines
BY CITY A.M. REPORTER
JULIUS Baer is in talks with Bank of
America about buying Merrill Lynch’s
non-US wealth management unit,
valued at up to $2bn (£1.3bn), in what
would be a massive deal for the acqui-
sition-hungry Swiss private bank.
Consolidation in the wealth man-
agement industry has been a major
theme since the 2008 financial crisis,
as an increase in costs and regulation
force some players to sell off units
and others – like Baer – to seek to
improve margins through scale.
“Given the early stage of these dis-
cussions, the outcome is entirely
open,” Baer said yesterday.
A spokesman declined to say
whether Baer was interested in buy-
ing the whole business or parts of it.
Sources said last month it was keen
on units in Europe, the Middle East,
Latin America and Asia excluding
Japan.
If Baer were to buy the business out-
right, it would increase assets under
management by about 50 per cent
Julius Baer in
talks for BAML
wealth division
BY HARRY BANKS
from the SFr178bn (£119bn) that the
bank reported at the end of April.
BAML put its wealth management
unit outside the US up for sale in April
as the business, which manages
$90bn for rich clients, was not large
enough to generate sufficient income.
Bank of America has been selling off
non-core business units to build capi-
tal. The bank has trailed rivals in
recovering from the financial crisis,
largely because of losses and lawsuits
tied to its 2008 acquisition of sub-
prime mortgage lender Countrywide
Financial.
SNR Denton earnings up 38pc
CITY law firm SNR Denton said
yesterday that cost cutting and
strategic changes had helped it
increase profits by 38 per cent in
2011-12, as profits per partner (PEP)
rose by 48 per cent to £350,000.
Though overall revenues dipped
by six per cent compared to last
year, the latest figures mark a
significant change in fortunes for
SNR Denton, which last year saw
PEP – a key measure of law firms’
profitability – fall by 36 per cent.
“We set a goal last year to
improve the performance of the
business and have managed to do
BY ELIZABETH FOURNIER that through cost efficiencies
despite a challenging environment,”
Matthew Jones, UK chief executive
told City A.M.
Though Jones said a reduction in
headcount had contributed to the
costs saving – with the Paris and
Istanbul offices significantly scaled
back – he said there was no single
standout item that had spurred the
reduction in its cost base.
SNR – which was formed through
the merger of the UK’s Denton
Wilde Sapte and US firm
Sonnenschein Nath & Rosenthal in
late 2010 – now plans to shift its
focus to improving turnover across
its offices, and expects a strong
stream of revenue to be its booming
energy and infrastructure practice.
“The energy team has been very
busy throughout the past 12
months and we expect that to
continue in the coming year,” said
UK managing partner Brandon
Ransley.
“We’ve also seen a steady stream
of work in the litigation and
arbitration department,” he added.
The partners refused to comment
on rumours of the firm’s ongoing
merger talks with rival firm Salans,
but said they were actively looking
to recruit over the next 12 months,
including adding staff through
lateral hires.
INVESTOR groups complained
yesterday that executive pay in the
financial sector remains “wildly
out of line” with the rest of the
country.
Speaking the day before business
secretary Vince Cable is due to
unveil his plans to tighten up
executive pay rules, bosses from the
National Association of Pension
Funds and other investing bodies
told the Treasury Select Committee
that boards need to do more to
appease the shareholder spring.
Pension groups urge firms to
listen to investors on exec pay
BY MARION DAKERS The NAPF’s head of corporate
governance David Paterson said
investor rebellions such as the vote
against pay at WPP should act as a
“wake-up call for boards”.
And ABI director-general Otto
Thoresen said that while some
banks had made efforts to change
pay for top staff, others were
taking too long.
Cable is set to unveil measures
designed to make firms more
accountable for what they pay top
staff, including a requirement to
set out improvements if they suffer
a substantial protest vote.
STATE-BACKED lender Royal
Bank of Scotland is making more
than 600 staff redundant as a
result of legislation due to come
into force at the end of the year,
bringing total staff reductions at
the bank since its 2008 bailout to
around 36,000.
RBS, 82 per cent owned by the
government, said the jobs would
go as a result of new UK rules
requiring retail financial
products such as savings and
investment vehicles to be sold by
more highly qualified staff and
RBS axes financial planner jobs
as cuts under Hester hit 36,000
BY CITY A.M. REPORTER
charged a fee.
“As a response to this we will
be reducing the number of roles
by 618 across the UK and
creating 351 new roles,” an RBS
spokesman said yesterday.
The cuts will apply to financial
planners, and will not hit the
bank’s corporate or investment
banking operations.
RBS has cut more than 35,000
jobs since chief executive
Stephen Hester was brought in to
turn the bank around when it
was bailed out in 2008.
The Unite union said it would
oppose compulsory job losses.
WEDNESDAY 20 JUNE 2012
4
NEWS
cityam.com
Vince Cable is today due to announce plans to tighten executive pay rules
Julius Baer Gruppe AG
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CONSUMER price inflation slowed
again in May to its lowest rate since
December 2009, according to official
data out yesterday.
Prices rose 2.8 per cent in the year to
May, down from three per cent in the
year to April, the Office for National
Statistics revealed, leading econo-
mists to forecast a new round of
quantitative easing (QE) from the
Bank of England.
The fall in inflation was driven by
food and non-alcoholic beverage
prices, which fell 0.3 per cent from
April to May, while petrol prices fell
4.5p per litre on the month.
The cost of living measured by the
retail price index (RPI) rose 3.1 per
cent in the year to May, down from 3.5
per cent a month earlier.
The tax and price index
(TPI), which takes into
account the impact of tax
changes on the cost of liv-
ing, rose 2.6 per cent, from
3.1 per cent in the year
to April.
Bank of England
governor Sir
Mervyn King
strongly hinted
last week that
more QE could be
on the way in an
effort to combat
Slowing inflation opens
door to money printing
BY BEN SOUTHWOOD
WALGREENS’ purchase of Alliance Boots
involved two very different firms: Goldman
Sachs andCenterview Partners.
On this side of the Atlantic it represents an
impressivecoupfor Centerview’s Richard
Girling, a sector specialist who holds an MA in
biochemistry from Oxford University. He
helped set up Merrill Lynch’s European health-
care business in the late 1990s and advised
Alliance Unichem on its merger with Boots
before returning the following year to advise
on its private equity buyout. Yesterday he told
City A.M.: “Alliancestuckwiththepeople that
helped them build the company up. I’m very
proud that this was going on for several
months andthere were no leaks.”
Goldman Sachs advised Walgreens, with a
team that included Stephan Feldgoise, Gene
Sykes, Mark Sorrell, John Gilbertson and
Andre Kelleners. It also mandated Lazard.
Walgreens’s legal advisers were Wachtell
Lipton Rosen & Katz and Allen & Overy, while
Alliance Boots turned to Darrois Villey Maillot
Brochier and SimpsonThacher &Bartlett.
Brunswick led the PR for Walgreens, while
RLM Finsbury represented Alliance Boots.
ADVISERS
RICHARD GIRLING
CENTERVIEW PARTNERS
BOTTOM
LINE
MARC SIDWELL
ECONOMICS: Page 17

WEDNESDAY 20 JUNE 2012
6
NEWS
cityam.com
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Walgreens puts on its Boots to look for profit overseas
H
AS Walgreens just secured
exclusive rights to the elixir of
youth? By joining forces with
Alliance Boots, the US
pharmacist gains the UK high street
stalwart’s No7 Protect & Perfect anti-
ageing cream, made famous by a BBC
Horizon episode in 2007 and a
clinical trial supporting its
effectiveness in 2009. That’s a handy
flourish on this giant deal, since the
anti-wrinkle wonder drug is sold in
the US today through the Illinois-
headquartered chemist’s biggest
rival CVS, and discount chain Target.
But Walgreens needs more than
moisturiser to keep looking its best.
Operating in every American state,
the domestically-focused firm relies
on pharmacy for 65 per cent of its
business. At its height it was filling
one in five of every retail
prescriptions in America. However,
it has just lost one of its most
important customers – and risks
losing another. Its contract with
Express Scripts ended on 1 January
2012, after both parties failed to
agree on terms. The contract was
worth $5.3bn (£3.3bn) in 2011,
responsible for 88m prescriptions
out of the 819m Walgreens filled in
total, and important too for the
additional sales to customers who
were visiting the stores for
prescriptions. Worse yet, Express
Scripts then went on to acquire
Medco Health in a $29bn merger.
Medco was responsible for 125m
prescriptions at Walgreens in 2011,
and while Express Scripts has
promised to honour existing
contracts, the bad blood between
the firms is not auspicious for such
an important part of Walgreens’s
business.
In that light, its sudden overseas
ambition seems understandable.
While Gregory Wasson, the
company’s president and chief
executive, was quick to say that
domestic growth remained on the
agenda, a 45 per cent stake and
option to proceed to full
combination with Alliance Boots
certainly diversifies the firm’s risk.
At least in some respects. The
ratings agency Standard & Poor’s
chose to pour a little cold water on
the deal by putting Walgreens’ A
long-term credit rating on watch,
citing a “meaningful deterioration”
of its financial risk profile. That’s
due to the debt it will take on to
finance the first stage of the deal
and the additional debt burden,
including assuming the debt of
Alliance Boots, that would come
with taking over the Swiss-
headquartered company in full.
But the risk involved in seeing the
deal through still looks compelling.
While American investors may
worry about solving deteriorating
market share at home with
exposure to the uncertain fortunes
of the Eurozone, the now-dominant
position of Boots in the UK is a real
prize, accounting for 62.7 per cent
of its group’s trading profit, while
expansion in areas like Thailand
shows the potential for a new global
behemoth to brings its combined
range of products to growing
markets the world over.
PROFILE: WALGREENS’ NEWEST BOARD MEMBERS
STEFANO PESSINA, ALLIANCE BOOTS
ALLIANCE Boots’ executive chairman shows no sign of slowing down
despite celebrating his 71st birthday earlier this year. Speaking to
reporters yesterday he reaffirmed his commitment to the firm and
said he was excited to be taking an eight per cent stake in Walgreens:
“I really believe in this company and I am very passionate about this
business. At Alliance UniChem we were great believers in global busi-
ness but we could not be global without the US. So for the last 10
years we have tried to create links with an American companies. I am
convinced that this is the ideal platform to create a real global com-
pany.” With an estimated wealth of over $2bn he could have given up
on global business a long time ago but the renowned workaholic
seems incapable of stepping away from the boardroom. Originally a
nuclear engineer, he became chief executive of Alliance UniChem in
2004 and led the firm’s merger with Boots in 2006. A year later he
helped take the group private in a deal with KKR. Given the opportu-
nities ahead, it is unlikely that he will be spending much time in his
Monte Carlo home in the near future.
4.5p
A LITRE
INFLATION SLOWED IN
MAY –BUT UNEVENLY
PETROL
1.7%
SPIRITS
MEAT
CAMERAS
FURNITURE
4.4%
SHOES
0.9%
0.4%
2.1%
POSTAL SERVICES
23.3%
the rapid deterioration in eco-
nomic conditions – analysts
think this fall in inflation will
create more room for him to
stimulate demand.
“The case for additional
QE in response to falter-
ing confidence is
stronger – we expect the
MPC to announce an addi-
tional £50bn in QE at the July
policy meeting,” said Barclays’
Sir Mervyn King
DOMINIC MURPHY, KKR
KKR’s European head of healthcare also leads the development of its
activities in the UK and Ireland and is a member of its European
investment and portfolio management committee. He joined the
investment firm in 2005, playing a major role in the 2007 leveraged
buyout of Alliance Boots, as a result of which he already sits on that
firm’s board of directors. With the new deal, he not only sees the vin-
dication of his earlier work but will also join the board of Walgreens.
Murphy has also played an important part in KKR’s investments in
Ambea, the Nordic healthcare provider, and SBS Broadcasting Group,
the European broadcaster subsequently acquired for €3.3bn by
another of KKR’s interests, the German firm ProSiebenSat.1 Media.
Before working for KKR, Murphy spent eight years as a partner at
Cinven, a rival private equity firm, where he worked on investments
including such well-known names as William Hill, United Biscuits and
Fitness First. Before Cinven, Murphy worked at 3i as an investment
manager. He is a member of the Great Ormond Street Hospital
Children’s Charity corporate partnerships board.
Chris Crowe.
This is only the second month since
late 2009 that CPI inflation has been
within one percentage point of the
Bank’s two per cent target, but the
MPC may feel able to loosen policy as it
forecasts stronger falls in inflation.
Credit subject to acceptance. Credit is provided by external finance companies as determined by DFS. 4 years interest free credit from date of order. Delivery charges apply. After event prices apply from 11.06.12 - see instore or online for details. Headrest optional extra. Accent
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IN BRIEF
Construction down across Europe
nConstruction in the Eurozone sank
by 2.7 per cent in April compared to
March and plummeted 6.6 per cent in
the wider European Union area. The
falls reversed climbs of 11.4 per cent
and 10.8 per cent respectively the
previous month. Despite the notable
increases in March, figures from
Eurostat – the official statistics office
in Brussels – have now shown declines
in the Eurozone-wide construction
industry in four of the last five
months. Compared to the same time
in 2011, construction in May was five
per cent down in the Eurozone and 5.1
per cent lower across the whole of the
EU.
Minister: Cyprus not doomed yet
nCyprus still has options open to find
urgently-needed funds to recapitalise
its banks, either through the EU rescue
fund or through a bilateral loan, its
finance minister said yesterday. “We
are optimistic we will get the
financing we need to recapitalise the
banks, whether that will be through a
bilateral agreement, or through the
mechanism, the EFSF,” finance
minister Vassos Shiarly said. “We
believe that with a new Greek
government now swifter
arrangements can be made [in this
direction].” Cyprus faces a regulatory
deadline to find €1.8bn to recapitalise
its second largest bank by the end of
this month after its balance sheet was
damaged by a write-off of Greek debt
earlier this year.
GREECE sold €1.3bn (£1.05bn) of
three-month T-bills yesterday,
with the yield slightly easing from
a previous auction in May.
The sale’s bid-cover ratio was
2.19, down from 2.32 in the 15
May auction. Greece paid a yield
of 4.31 per cent, down from 4.34
per cent in the previous auction,
the debt agency said.
Monthly T-bill sales are Greece’s
sole source of market funding.
Greek banks traditionally buy the
bulk of the T-bill issues, meaning
funding costs do not fully reflect
market strains.
Yesterday’s auction will fund
the rollover of a previous €1.6bn
issue that falls due on 22 June.
The Greek government’s
expenditure on interest payments
has reached an astonishing 20.7
per cent of GDP, according to Raj
Badiani of IHS Global Insight.
“If EU leaders think that the
outcome of the Greek election –
even the formation of a
government of salvation is
anything but a poisoned chalice,
they delude themselves,”
commented David Buik of BGC
Partners yesterday. “Greece is
condemned. It cannot meet its
financial obligations and never
will be able to.”
Greece raises
€1.3bn from
new T-bills
BY CITY A.M. REPORTER
G
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NEGOTIATIONS between key Greek
politicians have spilled into a third
day, as pro-bailout parties attempt to
form a fresh coalition.
Evangelos Venizelos, head of the
socialist Pasok party, said that he
hoped a deal could be struck after
lunchtime today. A three-way coali-
tion with the election winners – the
conservative New Democracy group
– and the Democratic Left party
appears to be on the cards.
Following the formation of a new
government, talks are expected to
resume on a renegotiation of the
conditions attached to the country’s
bailout package from Brussels.
A senior Eurozone official said yes-
terday that Greece could be cut some
slack.
“Anybody who would say that we
need not, and cannot renegotiate the
MoU [memo of understanding] is
delusional, because he, or she, would
be under the understanding that the
whole programme, the whole
process, has remained completely on
track ever since the weeks before the
Greek first election,” the official said.
“Because the economic situation
has changed, the situation of tax
receipts has changed, the rhythm of
implementation of the milestones
has changed, the rhythm of privatisa-
tion has changed, if we were not to
change the MoU, it does not work,”
he said.
“We would be signing off on an illu-
sion. So we have to sit down with our
Greek colleagues and say: this is
where we should be in July, and this
is where we are in July, and there is a
delta. Let’s find out what the delta is
and then how to deal with the
delta – that is a new MoU,” the offi-
cial said.
Greece secured a second, €130bn
bailout package in February from
Europe and the International
Monetary Fund, but an inconclusive
general election in May and last
week’s return to the ballot box
delayed the implementation of the
conditions attached to the bailout.
The US government, the largest IMF
member, has said that it supports
discussions to review the Greek
bailout programme.
Greek coalition haggling
drags on into a third day
BY JULIAN HARRIS
Costs spike at Spanish debt sale
SPAIN’S short-term borrowing
costs rose to their highest level
since 1997 in a debt sale yesterday
as investors worried the country
will soon be forced to ask for
international aid.
The country sold €2.4bn (£1.9bn)
of the 12-month T-bill at an
average yield of 5.074 per cent
yesterday, compared with 2.985 per
cent at the last auction in May.
It sold €639m of 18-month paper
at an average yield of 5.107 per
cent after a cost of just 3.302 per
cent last month.
The Eurozone’s fourth-largest
economy has become the focus of
BY CITY A.M. REPORTER
the regional debt crisis, with the
country struggling to overcome
recession and a costly banking
sector restructure.
Yields on Spanish 10-year bonds
have been trading above seven per
cent, a level that is seen as
unsustainable for Spain's shaky
public finances.
The rise in Spain’s longer-term
interest rates put the sale of €3bn
of bills in the spotlight ahead of a
bond auction tomorrow.
The government met its target
amount but the yield on the 18-
month paper was the highest since
November while the 12-month bill
sold with the highest rate since
before the birth of the euro.
Pasok chief Evangelos Venizelos said talks will resume this afternoon
Spanish PM Mariano Rajoy
THE FORUM: Page 23
▲ ▲
WEDNESDAY 20 JUNE 2012
8
ECONOMIC CRISIS
cityam.com
SPANISH officials yesterday
scrambled to downplay reports that
claimed the government is delaying
an audit into the country’s crisis-
struck banking sector.
Two audits have been expected
for publication at the end of next
month, yet reports yesterday
suggested that the government had
sought to postpone the publications
until September, with the supposed
purpose of requiring more detailed
analyses.
A spokesman for the Spanish
Spain ministry denies that it is
delaying key audit into banks
BY JULIAN HARRIS
government’s finance ministry later
denied the reports, claiming that
the audits are still on track to be
released towards the end of July.
Yet suspicions had already been
raised, further knocking confidence
in the troubled Eurozone economy.
The news “rocked risk markets”,
according to Kathleen Brooks of
forex.com. “This is being viewed as
negative and a sign that Spain has
something to hide (i.e. more bad
debts than we currently think),”
Brooks said. “Madrid chose the
wrong day to bury bad news as bond
yields were already above seven per
cent first thing.”
Business morale flops in France and Germany
G
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OPPOSITION MPs in Germany won
a victory over Angela Merkel’s coali-
tion yesterday as the country’s top
court ruled that the government
did not sufficiently consult parlia-
ment over plans for the Eurozone’s
permanent bailout scheme.
Chancellor Merkel’s government
hit back, however, insisting that the
decision will not prevent the ratifi-
cation of new laws surrounding the
European Stability Mechanism
(ESM).
“I see no concrete impact on the
current parliamentary proceedings
on the ESM and fiscal pact. There
will be no delay in ratification,” said
Nobert Barthle, the parliamentary
spokesman on budget affairs for
Merkel’s Christian Democratic
Union (CDU) party.
“It is about the information that is
given to the Bundestag in the
future,” Barthle added.
Nonetheless, the decision was a
strong slap on the wrist for Merkel’s
administration. The government
had “violated the rights of the
German parliament to be
informed,” the constitutional court
said in a statement.
Europe hopes to have the ESM in
effect from 1 July, yet cannot do so
German court slams
government over ESM
BY JULIAN HARRIS
FSB calls on banks to
raise capital buffers
BANKS should rapidly build up
capital buffers to create a solid
foundation for economic growth
and relieve pressures on indebted
sovereigns, the international
Financial Stability Board (FSB)
claimed in a new report last night,
arguing that short-term costs of
cutting lending are rapidly repaid.
The FSB also told the G20
nations that more cross-border
action is needed to draw up
practical resolution procedures
for systemically important banks
to prevent them devastating the
financial system in any collapse,
and said some national regulators
are not sufficiently independent
from their governments.
In the wake of the financial
crisis, new regulations were
drawn up to bolster banks’ capital
positions and ensure they can
survive future financial shocks
without needing government aid.
While that is supposed to be
good for the economy in the long-
run, critics say it has short-term
costs as banks have to cut lending
BY TIM WALLACE to shore up their positions.
However, the FSB believes the
opposite is true, as stronger banks
can access funding more cheaply,
and can pass that on to business
and household customers to the
benefit of the wider economy.
“The evidence is clear –
measures to strengthen financial
stability support economic growth
and create jobs rather than hold
them back, even in the short
term,” insisted FSB boss Mark
Carney.
“Credit growth has resumed in
those countries where financial
institutions have decisively
strengthened their balance
sheets.”
Indeed, banks which seize the
chance to strengthen their
positions will be able to take
market share from banks
elsewhere which are still
struggling by with higher funding
costs, the FSB believes.
That should also have the added
advantage of relieving financial
pressures on governments which
are currently facing the risk of
bailing out troubled banks.
IMF boss Christine Lagarde praised new countries that have responded to her organisation’s “call for action”
THE INTERNATIONAL Monetary
Fund (IMF) has bulked up its war
chest to $456bn (£290bn) after 12
new countries contributed cash.
Emerging powerhouse China
added $43bn to the crisis-fighting
reserves, while India, Russia and
Mexico provided $10bn each. The
UK will put in $15bn.
“These resources are being made
available for crisis prevention and
resolution and to meet the
potential financing needs of all IMF
members,” said IMF managing
director Christine Lagarde.
“They will be drawn only if they
are needed as a second line of
defence” when other IMF loans run
out, she said during the G20
summit in Mexico. “Countries large
and small have rallied to our call
for action,” Lagarde enthused.
Lagarde said in a statement that
the “seeds of pan-European
recovery were planted” at the
summit, with a commitment to
“break the feedback loop between
sovereigns and banks”.
IMF bolsters its crisis-fighting fund to $456bn
BY JULIAN HARRIS
WEDNESDAY 20 JUNE 2012
9
ECONOMIC CRISIS
cityam.com
unless it is ratified by Germany’s
parliament, where it requires a two-
thirds majority.
The opposition Social Democratic
Party praised the court’s verdict,
with MP Thomas Oppermann call-
ing it a “great day for parliamentary
democracy”. Future attempts to
install bailout structures must be
more accountable, he said.
Thirteen of the 17 member states
using the single currency have yet
to ratify the measure.
Finland, where politicians have
been particularly demanding over
the conditions for further bailouts,
is one of the countries where a vote
will be held this week.
Merkel’s allies say that the decision will not affect the bailout scheme’s ratification
GERMAN economic confidence
suffered its sharpest shock since
1998, according to the ZEW
index released yesterday, while
the INSEE measure of the
French business climate was
also shown to have slumped.
ZEW measured the
expectations that 350 financial
analysts had for the future, just
before the Greek election, when
34.1 per cent expected the
German situation to worsen,
compared to just 17.2 per cent
who expected an improvement.
Commenting on this week’s
Greek election result, ZEW chief
Wolfgang Franz cautioned that
it "affords us a short breathing
space, but nothing more and
nothing less”.
Meanwhile, the French INSEE
index revealed business morale
sinking to their lowest levels
since December 2009.
BY BEN SOUTHWOOD
BRITAIN’S grocery market grew 3.2
per cent in the 12 weeks to 10 June,
boosted by an 11.3 per cent leap in
the run-up to the Queen Elizabeth
Diamond Jubilee celebrations,
industry data revealed yesterday.
Market researcher Kantar
WorldPanel said supermarkets took
an extra £213m in the tills in the
week ending 3 June.
“The remarkable growth rate
recorded over the Jubilee is a sign of
what’s to come during the Olympics
when we expect grocery sales to
soar,” said Edward Garner, director
at Kantar WorldPanel.
“Competition is likely to be fierce
with fortunes now considerably
different among the big four.”
Overall, sales were up 3.2 per cent
in the period at £31.9bn, with Asda’s
and Sainsbury’s market share
strengthening, while Tesco and
Morrisons suffering share dips.
Asda’s 3.5 per cent growth was
partly due to its Netto acquisition,
while Sainsbury’s Brand Match
helped boost its 4.2 per cent growth.
Waitrose, Aldi and Lidl, all
recorded the strongest growth in
market share, but Tesco is still the
biggest retailer.
Jubilee gives
grocers £200m
turnover boost
BY CITY A.M. REPORTER
G
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WHY ARE COFFEE CHAINS STILL
THRIVING?Interviews byWIlliamOrr andLisaMoravec
It’s a mystery to me – I don’t see the point in
buying coffee when I can have it in the office.
When you think about it for the price of a coffee at £2.50
then you could buy a sandwich instead.
These views are those of the individuals above andnot necessarily those of their company
KAREN RAYMENT
SUMITOMO

I meet my clients in coffee shops, like Costa or
Starbucks, and I’d imagine a lot of people do
the same. But I know a lot of my friends are trying to
save money; and not buying coffee is one way to do so.
ALICE FROST
INSURANCE TIMES
In general I have a couple of hours a day in which
I have got nothing to do, what else could you do
apart from drink coffee –I can’t drink beer! They’re so well-
placed and I always know where I can find one to go to.
THOMAS SANG
ROCON


Chief executive Andy Harrison saw sales boosted by big-hitters Costa and Premier Inns
CITYVIEWS
WEDNESDAY 20 JUNE 2012
cityam.com
10
NEWS
WHITBREAD yesterday reported a
robust rise in sales on the back of a
strong performance at its coffee shop
chain Costa Coffee and hotel group
Premier Inn, sending shares up 6.3
per cent.
Underlying sales rose 4.5 per cent
in the 13 weeks to 31 May, boosted by
a 8.4 per cent rise in like-for-like sales
at Costa and a 4.3 per cent jump at
Premier Inn.
Whitbread has been pursuing an
aggressive expansion programme
across all of its businesses, pushing
total sales up by nearly 14 per cent.
“Our plans for profitable growth
are well established, supported by
our strong balance sheet, and we
plan to open 4,200 Premier Inn
rooms, eight joint site restaurants
and 350 new Costa stores this finan-
cial year, creating an additional
3,500 UK jobs,” said chief executive
Andy Harrison.
Whitbread sees
sales stirred up
by Costa Coffee
BY KASMIRA JEFFORD
He warned that the group would
face tougher comparatives in the sec-
ond quarter together with the
“uncertain” impact the impact of this
summer’s Olympic Games.
Costa is already Britain’s biggest cof-
fee shop brand with almost 1,400
shops and has a further 800 units
overseas.
It has nearly 50,000 Premier Inn
rooms in the UK and Ireland, as well
as 389 restaurants under brands such
as Beefeater and Brewers Fayre.
Whitbread PLC
19Jun 13Jun 14Jun 15Jun 18Jun
1,850
1,900
1,950
2,000
2,050 p
1,967.00
19Jun
Home Retail is lifted by Argos
despite a slump at Homebase
HOME RETAIL GROUP shares soared
23 per cent yesterday after the
company surprised the City with
better-than-expected sales at its
embattled catalogue chain Argos.
Like-for-like sales at Argos fell 0.2
per cent to £819m in the quarter to
2 June, after improved sales of
laptops, tablets and ebook readers
offset declines in TVs, audio and
video gaming.
That compared with a fall of
about 8.5 per cent in the previous
quarter and exceeded analysts’
forecasts of a four per cent decline.
BY KASMIRA JEFFORD
Home Retail chief executive Terry
Duddy, however, warned it was too
early to predict an upward trend in
sales growth at Argos.
“When you look at the hard
numbers on macroeconomics, life
has not changed that much; and
when you look at the hard numbers
as far as consumer confidence, that
is still in a difficult place,” he said.
Duddy said he was comfortable
with market expectations for full
year profit in a range of £37m to
£100m, with analysts settled at
around the £67m mark.
HRG said its DIY chain Homebase
saw like-for-like sales slump 8.3 per
cent, which it blamed on the
country’s wettest April on record
and a 15 per cent fall in sales of
seasonal products.
Home Retail Group PLC
19Jun 13Jun 14Jun 15Jun 18Jun
80
85
90
95
70
75
100 p 91.85
19Jun
A better-than-feared trading statement, although cash gross profits are
still down for both businesses. We remain negative, as we believe that Argos has
too many stores, too high a fixed cost base and is close to making losses.
ANALYST VIEWS


HOME RETAIL GROUP’S
RESULTS SHOW SIGNS OF
IMPROVEMENT? By Kasmira Jefford
PHILIP DORGAN PANMURE GORDON
In all and with expectations low, share price reaction has been positive.
Management confidence in the Argos store base appears likely to receive a boost,
with investors potentially happier to await an expected strategic review.

Like-for-like sales are notably better than our forecasts...Our preference
would be to play the modest improvements in underlying trends through compa-
nies with more leverage and self help like Kingfisher and potentially Dixons.


SIMON IRWIN LIBERUM CAPITAL

KEITH BOWMAN HARGREAVES LANSDOWNE
IN BRIEF
Airbnb doubles bookings
nUS home rental site Airbnb said
yesterday it had seen a dramatic rise
in bookings in the last five months.
The number of nights booked on its
site has doubled to 10m as the number
of properties listed also doubled to
200,000. Brian Chesky, Airbnb’s chief
executive, has highlighted
international expansion as the reason
for this growth. The San Francisco
based company recorded revenues of
$112m (£71.2m) last year and as a
result the company opened offices in
London, Paris, Barcelona, Milan,
Moscow, Copenhagen and Sao Paulo.
Sports Direct hires Oriel
nSports Direct International has
hired Oriel Securities as its joint
corporate broker. The FTSE 250-
listed British sports retailer said
yesterday that Oriel will now work
alongside Bank of America Merrill
Lynch with immediate effect.
Weir Group reaffirms target
nShares in engineering giant Weir
Group rallied 4.6 per cent yesterday
after it reconfirmed its full year
guidance. Stock prices have dropped
since February after warnings of
decreased orders in its oil and gas
news that the firm was back on track,
and an 18 per cent yearly increase in
its minerals division, boosted investor
confidence. Yesterday shares closed at
1503p.
HAMMERSON, the Anglo-French
property developer, announced yes-
terday it is selling the bulk of its
London office portfolio to Canada’s
Brookfield Office Properties for
£518m.
The deal comes after chief execu-
tive David Atkins put the offices up
for sale in February to focus on
retail property in the UK and France.
The FTSE 100 firm’s retail assets
account for 90 per cent of its portfo-
lio and include London’s Brent
Cross and the Bullring in
Birmingham.
Under the deal, Brookfield will
pay Hammerson £329m for 99
Bishopsgate, Principal Place and two
smaller assets by 30 September.
The sale of 125 Old Broad Street –
the former Stock Exchange – and
Leadenhall Court will be completed
in June next year for £189m.
Hammerson to
sell its offices
to Brookfield
BY KASMIRA JEFFORD
Hammerson said it will reinvest
the proceeds in retail developments
and buying up prime regional shop-
ping centres, retail parks and premi-
um designer outlets.
Martin Jepson, Brookfield’s senior
vice president for investment, who
joined from Hammerson last year,
said the deal gave the firm “a plat-
form for our portfolio in the UK”.
He said the building of Principal
Place would kick-off once they had
found a pre-let tenant.
David Paterson, a partner and head of cor-
porate at law firm Herbert Smith, was the
lead legal adviser acting for Hammerson on
the sale of its London portfolio.
Paterson, who joined the firm in 1986, is
longstanding adviser to Hammerson, acting
on its £584m rights issue and on its conver-
sion to a real estate investment trust. His
impressive credentials span a range of sec-
tors and include advising Tata Motors on the
$2.3bn acquisition of Jaguar and Land
Rover from Ford Motor Company and TUI
Travel on its creation after the £3bn merger
of First Choice Holidays with TUI AG.
He was joined on the deal by fellow lawyer
Jonathan Solomon, head of real estate at
Clifford Chance, who earlier this year was
involved in advising Canary Wharf Group on
its £90m acquisition of Wood Wharf from
Ballymore Properties.
Mike Edwards, executive director for central
London at CBRE and a team from Deutsche
Bank and Nabarro Bank were also among
Hammerson’s long list of advisers.
Meanwhile, GM Real Estate, Freshfields and
KPMG acted for Brookfield on its purchase.
ADVISERS
DAVID PATERSON
HERBERT SMITH
Universal’s effort to buy EMI is
knocked by competition probe
THE £1.2bn takeover of debt-
ridden record label EMI is still
just out of Universal Music
Group’s reach after the European
Commission yesterday issued the
music giant with an official
statement of objections.
Universal declined to give
details of the EC’s protestations,
saying in a statement: “We are
preparing a detailed response to
the Commission’s statement
which will address the concerns
outlined in this procedural
document.”
BY LAUREN DAVIDSON
Universal, which won the deal
in November after fending off a
rival bid from Warner, could be
forced to divest parts of its empire
or change the terms of its
licensing agreements to appease
competition concerns.
Sony’s £1.4bn bid for EMI’s
music publishing arm was
approved by Brussels in April after
it agreed to sell off some of EMI’s
catalogues.
Last week, EU competition
commissioner Joaquin Almunia
voiced concerns about the market
power of the combined group –
almost twice the size of its nearest
rival in Europe – and the impact it
could have on the digital music
market.
EMI’s lucrative back catalogue
includes The Beatles, Katy Perry
and Iron Maiden.
Universal said yesterday: “We
will continue to work closely with
the Commission and look forward
to securing regulatory clearance.”
Independent labels and rival
Warner are opposing the takeover.
The EC must come to a decision by
6 September.
The US Federal Trade
Commission is also reviewing the
deal.
Hammerson PLC
18Jun 19Jun 13Jun 14Jun 15Jun
410
415
420
425
430
435 p 428.00
19Jun
SHARES in French food group Danone
fell yesterday after it warned of a hit
to profits as Spanish consumers
switched to cheaper yoghurts and
milk prices rose, causing growth at
the Actimel maker to stall.
The world’s largest yoghurt maker
said demand had fallen sharply in
Spain and southern Europe as the
Eurozone debt crisis deepened, and
it is moving to cut prices to boost
consumption in the Iberian nation
where nearly one in four are
unemployed.
Finance chief Pierre-Andre Terisse
warned the continuing pain in Spain
will cut the group’s 2012 operating
Danone shares tumble as profit
suffers from low Spain revenue
BY CITY A.M. REPORTER
profit margin by 0.5 points to 14.2
per cent after a previous stable
forecast, and slow its underlying
sales growth in the second quarter to
around five per cent from the first
quarter’s 6.9 per cent.
He added that Danone’s Spanish
dairy sales had fallen since April-
May, hit by rising unemployment
and higher taxes in what is one of
Danone’s top worldwide markets,
accounting for seven per cent of
sales and 12 per cent of profits.
“Consumers are looking for
cheaper products,” Terisse said,
adding Danone would respond with
price cuts.
Shares in Danone fell as much as
seven per cent before closing 3.13 per
cent lower at €48.70.
WEDNESDAY 20 JUNE 2012
11
NEWS
cityam.com
Hammerson will sell 125 Old Broad Street (above) among other properties
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IN BRIEF
Daisy Group to give first dividend
nTelecoms firm Daisy Group has
pledged to pay a maiden dividend
next year after annual revenues
increased on the back of its
acquisition spree. The Lancashire-
based firm, which provides telecoms
services to SMEs, has shown rapid
growth and made more than 20
acquisitions in recent years. Adjusted
earnings before interest, tax,
depreciation and amortisation rose
from £40m to £56m, from revenues
up from £266m to £349m. The diluted
loss per share improved from 4.65p to
3.46p, with no dividend. Net debt is
£78m but is set to rise further
following Daisy’s £28m purchase of
Worldwide Group.
F&C Global Small Companies up
nThe F&C Global Smaller Companies
Investment Trust yesterday announced
it had beaten its benchmark, and
would make its 42nd consecutive
dividend hike. Shares gained 0.8 per
cent in the year to 30 April while net
asset value total return was down 0.1
per cent. That compares to the trust’s
benchmark, which fell four per cent.
The board announced a final dividend
payment of 4p a share, a 14.3 per cent
increase on last year. The trust said
small cap firms in the UK and Japan
performed relatively well compared to
the broader market.
IMAGINATION Technology, the chip
designer, yesterday reported a 30 per
cent jump in full year revenues to
£127.5m.
But its shares plunged as much as
10 per cent on fears that the London-
listed company leans too strongly on
its business from Apple.
Analysts doubted whether
Imagination has a large enough
range of clients to hit its target of
shipping an annual one billion chips
by 2016.
Liberum Capital said: “We continue
to believe that Imagination will strug-
gle to hit this target primarily relying
on only one of the key smartphone
players, Apple.”
Apple, which holds a nine per cent
stake in Imagination, is facing
increasing competition from its rivals
in the smartphone and tablet world.
Just hours before Imagination pub-
lished its results, Microsoft unveiled a
tablet called Surface, which does not
use Imagination’s technology.
But Imagination chief executive
Hossein Yassaie said he was unfazed
by this, saying that Microsoft’s new
Ofcom rules out caps
on media ownership
BY LAUREN DAVIDSON
operating platform Windows 8 will be
a significant partner for the firm.
He said: “Our smart technologies are
being adopted more widely across
new and existing partners... making
our stated goal of around one billion
annual unit shipment by 2016 a realis-
tic objective.”
Imagination posted a pre-tax profit
of £28,544, up 74 per cent from the
previous year, and said its cash bal-
ance increased by 34 per cent to
£66.3m.
Royalty revenues grew 55 per cent to
£63.8m, while technology revenues
jumped 41 per cent to £98.2m.
Its shares closed down six per cent at
457p.
Imagination sinks on
Apple reliance fears
OFCOM yesterday came out in
opposition to imposing limits on
media ownership just days after
Ed Miliband called for caps on
media market share.
Publishing its response to a
handful of questions proposed by
culture secretary Jeremy Hunt in
October, Ofcom said a review of
media plurality should be
conducted every four or five years.
The media watchdog pointed to
special circumstances in which
the exit of a news organisation
could trigger a review.
But Ofcom said it “does not
believe a prohibition on market
share is currently advisable”,
calling it “inflexible”.
Speaking to the Leveson
inquiry last week, Labour leader
Ed Miliband said it was wrong for
BY LAUREN DAVIDSON
one organisation to exercise
overweening power, adding that
News Corp’s command of 34 per
cent of the market should be
reduced to about a fifth.
Media plurality
entered the spotlight
during Murdoch’s
attempt to buy the
chunk of BSkyB he does
not already own.
The divisive bid
prompted
Ofcom to
undertake a
consideration
of plurality in
2010, in
which it
found that
the
existing
framework
for considering
plurality might no longer be
equipped to achieve the
government’s policy objectives.
In its report released yesterday, the
watchdog argued that the BBC
should be included in an evaluation
of media plurality, but that its
current market position does not
warrant a special review.
Ofcom said online news should be
included in any review.
Alison Sprague, media
specialist at FTI Consulting,
said Ofcom has just thrown
the decision “straight back to
parliament”, offering a
cautious response – “no
doubt parliament would
have preferred this to
remain with the regulator.”
Imagination Technologies Group PLC
18Jun 19Jun 13Jun 14Jun 15Jun
420
440
460
480
500
520 p 456.90
19Jun
Jeremy Hunt asked Ofcom
to look into media plurality
NONE of Cable & Wireless
Worldwide’s directors received
bonuses in 2011/12, the year in
which the telco’s value dropped by
almost a third.
But John Pluthero, the former
CWW boss under whose
management the company slipped
to a staggering £443m first half
loss, pocketed £790,938, including
a £656,750 salary and £134,188 in
lieu of pension provision.
Pluthero was chief executive
Pluthero pockets hefty packet
as CWW board forgoes bonuses
BY LAUREN DAVIDSON
from June to December 2011, but
remained an employee of CWW
until the end of March.
Current chief executive Gavin
Darby, who joined CWW in
November and under whose
leadership the company has
secured a £1bn takeover offer
from Vodafone, took home
£266,000.
As chairman John Barton
summarised in the annual report
published yesterday: “This has
been an extraordinary year of
change and challenge for CWW.”
KEWILL yesterday announced
an increase in the takeover
price offered by Kinetic Bidco,
the investment vehicle owned
by the Francisco Partners Fund.
The British software firm said
it has now been offered
£102.7m, up from the £89.5m
price offered last month.
The 110p per share offer –
formerly 96p per share –
represents a 44.7 per cent
premium to the stock’s closing
Kewill turns it back on Kestrel’s offer and
supports higher bid from Francisco Partners
BY LAUREN DAVIDSON
price before the offer was
announced, the company said.
It is also a premium of 3.8
per cent over the 106p per
share bid tabled by Kestrel
Bidco, under parent company
Symphony, on 12 June.
At the time, Kewill said it
intends to recommend
unanimously that its
shareholders vote in favour of
the Kestrel offer, but it
yesterday backed Kinetic’s bid.
Kinetic said it also had the
support of 25 per cent of
Kewill’s stockholders.
London-listed Kewell’s shares
jumped 3.9 per cent to 113p.
John Pluthero left Cable & Wireless Worldwide at the end of last year
WEDNESDAY 20 JUNE 2012
13
NEWS
cityam.com
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Kewill PLC
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107
109
110
111
112
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19Jun
NATIONAL Express yesterday met
with investors in Spain to reassure
them that its Spanish business is
performing well.
The firm said Alsa, its intercity
and urban bus service, “has
continued to be resilient” in the
second quarter in spite of Spain’s
economic turmoil.
“Alsa’s intercity coach revenue
has continued to grow and urban
bus revenue has been strong. As
expected, revenue from the smaller
non-transport activities has
declined,” it said in a statement.
The firm is waiting to collect less
money from Spain’s state bodies
than it was at the end of 2011, it
added.
Shares in National Express rose
2.6 per cent to 199p yesterday,
outperforming the FTSE 250 index.
The firm is due to issue a trading
statement on 28 June.
Shore Capital analyst Greg
Johnson said in a note that
yesterday’s update underpins the
firm’s strong performance in
recent months.
Spanish buses
boost National
Express shares
BY MARION DAKERS
G
E
T
T
Y
FEDEX reported above-forecast
adjusted quarterly profit
yesterday and forecast higher
2013 results, as it said it expected
to take new cost-cutting
measures to offset shipments
weakened by soft global
economies.
The world’s second-largest
package delivery company said
that net profit for its fourth
quarter ended 31 May was
$550m (£350m), or $1.73 per
share, down from $558m, or
$1.75 per share, a year earlier.
But adjusted profit before
items was $1.99 per share, up
from $1.75
a year
before,
and
revenue
rose four
per cent
to
FedEx tops its
profit forecast
BY CITY A.M. REPORTER reach $11bn.
FedEx said it faces cost increases
in 2013, including higher pension
expenses and depreciation costs.
It also said it sees profit per
share of $1.45 to $1.60 in the first
quarter and $6.90 to $7.40 in 2013.
The outlook “does not include
the impacts of the significant cost
reductions programs currently
under review that should be
announced in the fall,” the
company said in a statement.
In its largest segment, FedEx
Express, US domestic revenue per
package rose six per cent in the
fourth quarter due to higher rates
per pound, fuel surcharges and
growth of premium services, even
as volume declined five
per cent.
IN BRIEF
Cobham completes Thrane deal
n Cobham, the defence giant, said
yesterday it had completed its takeover
of Danish satellite firm Thrane and
Thrane. Management responsibilities
for land and airborne SATCOM
operations will transfer to the Danish
company at the end of 2012. The
company said in a statement that the
Thrane and Thrane deal met the
minimum acceptance condition on 8
May and that 90 per cent of Cobham’s
shareholders agreed to the deal, which
will formally take place on 22 June.
Chemring profit hit by US delays
n Chemring Group said yesterday its
profits have fallen in the first half of
the year due to delays in US defence
orders, but that it will meet
expectations by the end of the year.
However, the military equipment
maker said that its order book was up
14 per cent at £1bn since October 2011.
For November-April the company said
underlying pre-tax profit fell 21 per
cent to £39.2m. Revenue from
continuing operations rose four per
cent to £333.3m.
Kentz on track for full year
n Kentz Group said yesterday it
remains on track to meet its own
guidance, as its backlog of work on
hand grew further to £1.6bn. The
company also said growth from its
existing clients plus new orders
amounted to about £448m. Christian
Brown, chief executive of Kentz, said
that although that the global economy
is still struggling, “our broad base of
clients, diversity of operations and
significant global footprint gives us
great confidence for the future”.
ALLEN STANFORD EXECUTIVE TO PLEAD GUILTY
LAURA
Pendergest-
Holt, former
chief investment
officer for Allen
Stanford, has
agreed to plead
guilty and
receive a three-
year prison
sentence for her
role in a $7bn
(£4.45bn) fraud,
according to
reports
yesterday.
Earlier this
month, former
billionaire
Stanford was
sentenced to 110
years in prison
for running a
scheme in which
he stole money
from his
investors to
finance an
extravagant
lifestyle in the
Caribbean.
Pendergest-
Holt will plead
guilty to a
single
obstruction of
justice charge,
the reports said.
WEDNESDAY 20 JUNE 2012
14
NEWS
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22-23
The US Olympic
equestrian team
arrived via FedEx
THE ROMANS were the first to
master the art of mixing busi-
ness with their all-important
leisure time.
Jon Hunt – the property entre-
preneur who made £375m selling
estate agency Foxtons in 2007 –
has come up with his own con-
cept of combining the two: an
office-rental club with all the
perks of a five star hotel.
Dryland – what a sailor
hopes to reach from out at
sea — will officially launch
its first site on Kensington
High Street this month.
It has a swanky cafe at the
front, open to all, then
three marbled floors of
pods, offices and confer-
ence rooms behind, for
members’ use only.
It is also equipped
with lounge areas, a
library and a 31-seater
cinema room complete
with gourmet popcorn.
What more could an over-
worked entrepreneur ask for?
Membership ranges from £99 a
month for basic access to £1,299
to be a first-class member, which
gets you access to a garden terrace.
So who will be using the club and is
there demand for more flexible
office space? Hunt certainly
What the Foxtons man did next
believes so. “The idea was driv-
en by the fact that traditional
serviced offices are blue and
grey and three star – you go
there because you have to, not
because you want to,” he told
The Capitalist.
Got A Story? Email
thecapitalist@cityam.com
15
cityam.com
cityam.com/the-capitalist
THECAPITALIST
The City of London will be
overtaken by musicians and
charity collectors as Alexandra Rose
Charities, an organisation that supports
smaller charities that deal with young
unemployed people, celebrates its
centenary tomorrow.
Boris Johnson, the Mayor of London,
said: “I urge everyone to enjoy the
choirs, buy a rose and give generously
on Alexandra Rose Day."
Events will start at the headquarters of
Bank of America Merrill Lynch at
midday.
The centenary collection will raise
funds for three London charities:
Downside Fisher, a youth club in
Bermondsey; JusB, a youth club and
counselling centre in Bromley; and
EnfuseYouth, an innovative charity
helping the young unemployed find
jobs.
Downside Fisher will use the money to
train young people to swim so they can
apply to be deck hands at the nearby St
Katherine Dock marina.
And funds raised for JusB will help pay
for a youth outreach worker to offer
support to young people in the area.
WEDNESDAY 20 JUNE 2012
Are you up all night for all the wrong reasons?






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“Dryland is the complete opposite,
it’s about great service, great design,
great technology in a great location.”
Almost 300 members have signed up
so far, the majority from the financial
services sector, followed by tech, edu-
cation and property. Hunt expects
Dryland to be fully booked within two
years of opening.
Hunt, who is estimated to have
amassed a wealth of £882m, is eyeing
further sites, if all goes well. Holborn is
next, where he has already bought a
site, followed by the City and Soho.
Dryland offers workspace
to entrepreneurs who
don’t want tor commit to
an office lease
Singing in the
City will boost
charity funds
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IN BRIEF
High taxes stifling UK growth
nThe tax system puts a heavy
burden on growing enterprises as
their taxes increase the more they
produce, revealed a report published
by the Institute of Directors (IoD)
today. Even the smallest firms with
five employees have to pay more than
30 per cent of their profits in tax,
while middle-sized businesses have
to pay more than 40 per cent – taking
about four months’ worth of profits.
“Entrepreneurs and investors will not
put their money on the line if the
return after tax is too small,” said
Richard Baron, head of taxation at the
IoD.
School leavers not ready for work
nYoung peoples’ expectations of
careers and how to progress are not
based on hard evidence, according to
a new report out today which urges
the government to take steps to
change school leavers’ plans. The
study from the Financial Skills
Partnership and Career Academies UK
showed that many young people aged
17 and 18 do not understand university
fees, know too little about
apprenticeship options and are in a
poor position to make informed
choices which affect their future
career options.
Growth in US housing market
nThe housing recovery may be back
on in the US, as data out yesterday
showed a strong rise in housing starts
last month. New permits granted
reached their highest level since 2008,
growing by 7.9 per cent to 780,000 in
May. This was well above forecasts,
suggesting that there will be a greater
future demand for new houses.
Home building dropped in May by 4.8
per cent month-on-month associated
with a 21.3 per cent drop month-on-
month in multi-family construction.
RUNAWAY inflation over the past two
years has pushed public satisfaction
with the Bank of England to record
lows, a new study reveals today.
A net balance of just 11 per cent sur-
veyed were satisfied with the Bank’s
performance last month, down from
20 per cent in February and barely
above the record low of nine per cent
recorded in November 2011.
Consumer price inflation hit 5.2 per
cent last September, more than dou-
ble the Bank’s two per cent target,
and only fell back to three per cent in
April, spending more than two years
Brits lose faith
in the Bank’s
performance
BY TIM WALLACE
above target.
But the wider economic outlook
may also be to blame.
“Households may have become less
satisfied with the Bank following the
financial crisis and the associated
weakness in demand,” the quarterly
review suggests.
“Movements in net satisfaction also
appear to be closely related to general
economic sentiment, such as that con-
veyed in survey measures of consumer
confidence.”
The study also found that members
of the public who think quantitative
easing is designed to boost demand or
stop inflation falling below target are
HOUSE PRICES in London and the
south east rose quickly in the year
to April 2012, contrasting starkly
with stagnation or even deflation
elsewhere, according to official
data published yesterday.
An increase of 4.9 per cent in the
average London house price, to
£388,000, and a 2.1 per cent rise in
the south east, drove an uptick of
BY BEN SOUTHWOOD
1.7 per cent in England as a whole.
The data also showed the
proportion of first time buyers
shot up to 43 per cent of all
purchases in March, as buyers
scrambled to take advantage of the
stamp duty holiday, which expired
at the end of the month.
That boom rapidly dropped away
and first-time buyers accounted for
32 per cent of purchases in April,
close to their long-term average.
WEDNESDAY 20 JUNE 2012
17
NEWS
cityam.com
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SEE PAGE 25
▲ ▲
T
HIS week we are asking mem-
bers of our Voice of the City
panel to pick a date for the UK’s
next round of quantitative eas-
ing.
Members of the panel, which is
run with PoliticsHome, can have
their say on whether and when Sir
Mervyn et al should turn the taps
back on to pour cash into the
economy.
After yesterday’s lower than
expected inflation figures, should
the Bank of England jump in with
more QE as soon as possible, or wait
VOICE OF THE CITY
PoliticsHome.com PoliticsHome.com In association with
Apply to join today at WWW.CITYAM.COM/PANEL
and see for weeks, or months?
And is the Bank’s scheme to push
up lending to businesses going to
work?
And away from Threadneedle
Street, is the UK expected to emerge
from recession any time soon?
To answer these questions and
more, apply to join the panel at
www.cityam.com/panel
Results of the poll will be
published in Monday’s paper.
Index is still higher than at any
time in 2011 apart from April
(when the royal wedding and a
sunny spring briefly inspired a
rise in confidence) – but it is
somewhat concerning that we do
seem to be on a negative trend.
WORKPLACE GLOOM
Looking at the figures, the largest
driver of the fall this month has
been business activity levels at
respondents’ places of work.
Retrospective scores (change
over the past month) saw a six
point drop – down from 110 in
May to 104 in June.
Expected change over the
forthcoming 12 months also
became gloomier – falling from
119 in May to 116 in June.
This contrasts with the peaks
seen in March, when the
retrospective score was at a 12-
month high and prospective levels
stood at an all-time high.
TOP EARNERS
Diving deeper into the data, one
interesting finding is that while
the overall HEAT index has gone
down, for those earning £50,000
or more it has actually risen and
is now on 106, a two-year high.
CONFIDENCE AMONG WELL-OFF
The gradual rise in confidence
among higher earners now means
that those on top wages are a
whopping 13 points above the UK
average.
That shows that while the
BRAND
INDEX
STEPHAN SHAKESPEARE
Confidence edges lower but those at the top remain cheerful
E
CONOMIC confidence among
consumers has continued its
downward path in June,
according to the latest figures
for YouGov’s Household Economic
Activity Tracker (HEAT) – but this
is not necessarily a reason to
worry yet.
The first three months of the
year saw the index accelerate
upwards, but that momentum
stalled in April and scores have
been going down ever since.
The overall index, which is an
amalgam of household economic
activity, job security, business
activity in respondents’
workplaces and house price
perceptions, fell slightly from 95
in May to 93 in June.
We should not get overly
negative about the decline – the
country as a whole is feeling less
confident about the economic
future, the well-off appear to be
increasingly assured about their
position.
Stephan Shakespeare is the chief executive
of YouGov
HEAT Index
Jun‘12 Feb‘12 Oct ‘11 Jun‘11 Feb‘11
100
95
90
85
80
75
HEAT Index £50k+
Jun‘1 Feb‘12 Oct ‘11 Jun‘11 Feb‘11
120
100
80
60
40
20
0
more likely to be satisfied with the
Bank’s performance.
However, very few are aware of the
official purpose of QE – just nine per
cent thought the primary aim was to
stop inflation falling below target in
the future. When selecting from a list
of options, 26 per cent thought the pri-
mary objective of QE is to increase con-
fidence in the economy and 36 per
cent say they did not know the aim.
“The monetary policy committee has
agreed that explaining QE should con-
tinue to be an important area for the
Bank’s communication strategy,” the
report concluded.
The MPC has printed £325bn in an effort to stop inflation falling below two per cent
London’s housing boom keeps
driving national price growth
EMERGENCY measures to boost the
economy will help support Britain’s
banks against any collapse in the
Eurozone markets, supporting
credit ratings in the sector, said
ratings agency Fitch yesterday.
However, the “funding for
lending” scheme, through which
the government and bank of
England hope to give cheap funds to
BY TIM WALLACE
banks, will have a neutral impact.
That is because the funds will only
be given on the basis that they are
passed on to firms and households
at low interest rates, the agency said.
However, the report did confirm
that the plan “could help increase
lending to small and medium-sized
enterprises that have previously
baulked at the current cost of
borrowing,” as the chancellor and
Bank of England governor hope.
Fitch gives thumbs up to plan
to help banks and raise loans
RUSSIAN steel and mining group
Evraz yesterday set out plans for
$6bn (£3.8bn) of capital spending
through the next four years as it
seeks to meet growing global
demand for railways and pipelines,
particularly in North America.
Evraz, Russia’s largest steel produc-
er and part-owned by billionaire
Chelsea FC owner Roman
Abramovich, said it plans capital
expenditure of $1.5bn a year on aver-
age through the coming four years.
The London-listed group also said it
was targeting earnings before inter-
est, taxes, depreciation and amortisa-
tion (Ebitda) of $5bn in 2016,
compared with $2.9bn in 2011.
Evraz plans “increased investment
focused on adding value to steel
products, particularly in the rail and
pipe segments,” the company said,
adding that a “positive contribution
of investments to Ebitda and cash
flow [is] expected from 2013.”
The company, which earlier this
week approved a 2011 dividend of
$0.17 per ordinary share, said it
would remain committed to main-
BY HARRY BANKS
taining a balance between invest-
ment and the payment of dividends.
Evraz, whose debt stood at $7.38bn
as of 31 March, said its net leverage
was likely to rise by year-end, but net
debt will not exceed two times
Ebitda in the medium term.
The company, which leads the US
market for large-diameter pipes (LDP)
by production capacity, is upbeat on
prospects for growth in the North
American steel market in coming
years, forecasting growth of four per
cent a year through 2016.
The company is one of the world’s
top-20 steel producers and produced
crude steel output of 16.8m tonnes
in 2011.
EVRAZ
18Jun 19Jun 13Jun 14Jun 15Jun
260
265
255
270
275
280
285 p
283.09
19Jun
WEDNESDAY 20 JUNE 2012
18
NEWS
WHO’S SWITCHING JOBS Edited by Tom Welsh
SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
Inflation relief helps push FTSE
to its highest close in six weeks
DASHBOARD CITY
CITY MOVES
To appear in CITYMOVES please email your career updates and pictures to citymoves@cityam.com
Galliford Try
Graham Prothero has joined the board of the
housebuilding and construction group as
group finance director. He replaces Frank
Nelson, who will retire at the end of
September 2012. Prothero joins from
Development Securities, the property
developer, where he has been finance director
since November 2009. He was a partner at
Ernst & Young from 2001 until 2008.
Inmarsat
The mobile satellite communications service
provider has appointed Martin Turner as its
director of media business. He will develop
the firm’s relationship with broadcasters.
Turner was previously head of newsgathering
at the BBC, and has served as the BBC’s
bureau chief in both Johannesburg and
Washington.
Deloitte
Mark Doleman has been promoted to lead the
business advisory’s UK entrepreneurial
business practice. He replaces Tony Cohen,
who is taking on a global entrepreneurial
business leadership role. Doleman has been a
partner at Deloitte for 12 years, and senior
Houlihan Lokey
The investment bank
has appointed
Kristian Terling as a
managing director
and head of Nordic
coverage. He was
most recently
managing director and co-head of Nordic
investment banking at Credit Suisse in
London. Terling has also served as sector
head in the corporate finance group at
Handelsbanken Capital Markets, and started
his career at Merrill Lynch.
Consumer price inflation (CPI)
eased unexpectedly in May to its
lowest in two and a half years due to
slower price rises for food and fuel.
The FTSE 100 index closed up
95.22 points, or 1.7 per cent at
5,586.31, just below the 5,600 level
which was breached briefly late
afternoon for the first time since he
start of May.
Investors were also betting on
hopes that a US Federal Reserve
policy meeting will sanction fresh
stimulus measures at their two day
meeting, concluding today.
Heavyweight energy stocks,
LONDON
REPORT
B
RITAIN’S leading share index
hit a six-week high yesterday
on growing hopes for
concerted economic stimulus
measures from central banks, with
a fall in UK inflation seen as
increasing the chances of another
Bank of England move.
Evraz plans to
spend $6bn to
meet demand
cityam.com
partner in its Nottingham office for seven
years.
EC Harris
The built asset consultancy has made three
new appointments to its partnership. Stephen
Norris joins its property and asset
management division from Ernst & Young,
where he ran its corporate real estate
advisory. Mike Nugent joins the water and
utilities division from KPMG, where he was
head of water. Paul Webber joins the power
and energy division from Jacobs Engineering,
where he was director of operations.
Future Capital Partners
Anthony Rogers has been made business
development manager at the alternative
investment boutique. Prior to joining the firm,
he worked at Lord Associates, the niche tax
planning firm.
Libra Investment Services
Charlie Morgan has been appointed to the
pan-European sales and trading team at the
portfolio analysis firm. He joins from Parkwalk
Advisors, an independent investment firm,
where he was a founding partner. He has
worked in the equity markets since 1987.
+44 (0)20 7092 0053
morganmckinley.com
Hopes the Federal Reserve will
extend stimulus lifts US stocks
U
S stocks rose yesterday on
hopes that the Federal Reserve
will agree to extend stimulus
measures as the economy
struggles to recover and the
Eurozone’s debt crisis gets worse.
The S&P 500 has gained 7.2 per
cent from a five-month intraday low
reached on 4 June. The benchmark
index closed above its 50-day
moving average of 1,346.90 for the
first time in seven weeks. But the
sharp gains leave the market
vulnerable if the outcome of
tomorrow’s Fed meeting doesn’t
meet market expectations.
Growth-related stocks led the
rally, with the S&P materials sector
index up two per cent and the
financial sector index up 1.7 per
cent. US Steel jumped 9.5 per cent
to $20.15. Bank of America added
4.5 per cent to $8.11.
The Dow Jones industrial average
gained 95.51 points, or 0.75 per
cent, to 12,837.33 at the close. The
Standard & Poor’s 500 Index
advanced 13.20 points, or 0.98 per
cent, to 1,357.98. The Nasdaq
Composite Index rose 34.43 points,
or 1.19 per cent, to end the day at
2,929.76.
BESTof theBROKERS
ITV PLC
75
74
71
70
72
73
p
15Jun 18Jun 19Jun 13Jun 14Jun
74.15
19 Jun
FTSE
5,540
5,560
5,480
5,520
5,500
5,440
5,460
5,420
12Jun 13Jun 14Jun 15Jun 18Jun
5,491.09
18 Jun
NEW YORK
REPORT
YOUR ONE-STOP SHOP FOR JOB MOVES,
BROKER VIEWS AND MARKET REPORTS
in association with
Visit our space at ncp.co.uk
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19
ITV
Goldman Sachs has
knocked ITV off its
“conviction buy” list on
the back of macro
uncertainty. Recent
advertising indications
have been softer than
expected, and ITV is
down 15.1 per cent since
being added to the list
in April. Key risks
include an ad slowdown
after the Olympics.
miners and banks were the top
performing blue chip sectors,
lending their strength to the index
as investors bought on hopes of a
liquidity boost.
Drugmakers were also in demand.
AstraZeneca gained 2.9 per cent as
broker Liberum Capital suggested a
merger of equals with AbbVie, due
to be spun off from parent Abbott
Laboratories, could generate some
$4bn of synergies.
Whitbread topped the FTSE 100
leader board, up 6.4 per cent after
the leisure group reported solid
growth in first-quarter sales,
boosted by a strong performance
from its coffee shop chain, Costa.
WEDNESDAY 20 JUNE 2012
APR Energy PLC
780
760
740
720
700
p
15Jun 18Jun 19Jun 13Jun 14Jun
716.00
19 Jun
APR ENERGY
UBS holds its “sell”
rating for APR Energy
despite the company’s
downgrades, saying it
believes the stock is
pricing in more than it
should and preferring
to wait for the firm to
“get through its
teething issues”. But
UBS has cut APR’s 12
month price target
from 860p to 690p.
Bumi PLC
370
360
340
350
310
320
330
300
p
15Jun 18Jun 19Jun 13Jun 14Jun
349.10
19 Jun
BUMI
JP Morgan has
initiated coverage of
Bumi with an
“overweight”
recommendation,
saying the mining
group is “heading in
the right direction but
prepare for a bumpy
ride”. It is the “classic
high risk, high reward
proposition,” the
broker said.
Explore beyond limits: Acer sets
its sights on emotional branding
Walter Deppeler talks about the electronics
corporation’s big technological ambitions
Q
What’s your brand’s primary
reason for being involved with
the Games?
A
Acer is proud to be the world-
wide computing partner of the
Olympic movement. We feel we
share the Olympic values, and
have a deep respect for the sports
and its athletes. The association with
the Olympic Games is important for
our brand, with our new tagline
stating: “Explore beyond limits”.
We are providing the best tools and
latest technologies for athletes who
challenge themselves continuously to
become champions. Thanks to the
Olympic partnership, we hope to
enrich our brand with emotions,
which is so important in the comput-
ing industry, where many brands
have difficulties differentiating them-
selves from their competitors.
We hope that the Olympic partner-
ship will make our brand more
human and inspirational. That the
Games bring us additional interest
from consumers, while the smooth
running of Acer during the Games
helps to gain their trust.
This is also a great opportunity for
us to show the best technologies and
skills, not only to consumers, but also
to B2B clients.
Q
How was the case for
involvement structured to the
board?
A
We made the decision to
sponsor the Olympic Winter
Games in Vancouver in 2010
and the 2012 Olympic Games
back in December 2007. The
sponsorship details – including
benefits, costs, manpower and
challenges – were presented to the
board, who reviewed and agreed to
go ahead with the sponsorship. A
special Olympic taskforce was also
formed to focus on the planning and
execution of the project.
Q
How have you structured your
business to maximise the
opportunities?
37 DAYS TO GO
COUNTDOWN
TO THE LONDON
2012
OLYMPIC
GAMES
OLYMPICBUSINESS
20
WEDNESDAY 20 JUNE 2012
cityam.com
A
We are excited to offer
everyone who loves the
Olympics, and wants to
celebrate the Olympic spirit
through technologies, a wide range
of Olympic Games products. We’ve
designed an Aspire notebook, an
Iconia tablet, an LCD computer
monitor and an Aspire all-in-one
desktop to showcase Acer’s
excellence in engineering and
design. As well as to celebrate our
Olympic partnership.
All the products have the Acer
Olympic Games composite logo,
showing the Acer brand and the
Olympic Rings together. Thanks to
our partnership with Eurosport,
those who buy our Olympics Games
edition notebooks and tablets can
stay connected and follow the Games
live through the Eurosport player. We
shall combine technological innova-
tion and premium content to create
unique Olympic Games experience.
Q
How did the announcement
that you were involved affect
your business?
A
Sponsoring the Olympic Games
is one of several sports
marketing initiatives by Acer. It
helped to elevate the
awareness and value of our brand to
be associated with such a grand
event. Within our company, the
association also boosted employee
morale. Overall, the sponsorship has
impressed everyone we have come
into contact with.
Q
Which are the most crucial
commercial opportunities
and how will you be using
these for maximum return?
A
London 2012 will allow us to
show-case our consumer and
professional technologies. The
PC infrastructure provided by
Acer to power the Olympic Games
covers the entire complex. In total,
13,500 desktops, 13,000 computer
monitors, 2,900 notebook, and 950
servers have been deployed to serve
the numerous venues.
Acer is also providing ground sup-
port at the Olympic venues, with
more than 350 Acer technicians and
engineers.
We will also create four PC Lounges
for both media and athletes, located
in the Olympic Villages and Main
Press Centre. Acer Internet Cafes will
be open 24 hours a day during the
Games.
The Acer Internet Lounges for ath-
letes is themed around a garden, pro-
viding athletes with 150
fully-equipped stations with broad-
band internet access, communication
and social networking environments.
Keeping them up to date with the
things that matter the most, and in
touch with their friends and family in
a relaxed way.
During the Games, Acer will also
run an 800 square metre interactive
showcase in the heart of the Olympic
Park. The Acer pavilion will host park
visitors and special Acer guests from
all around the world. The pavilion’s
theme is ‘The Acer Journey’ and the
showcase will give visitors an oppor-
tunity to explore exciting Acer tech-
nology.
Q
What has surprised you
most about your
involvement at the date?
A
The Games take you into a
completely different
dimension that you don’t get
in your usual business life.
The time of preparation,
difficulties and size of operations
are massive. You can only
understand them once you are
involved.
Both professionally and
personally, the Games are a
unique sporting and cultural
experience.
Walter Deppeler is senior corporate vice
president and chief marketing officer of
Acer.
The London Games are
elevating the company
into a different dimension
WEDNESDAY 20 JUNE 2012
21
MARKETS
cityam.com
LON GD ONCE FIX AM..................................1628.50 5.00
SILVERLDN FIX AM.........................................28.52 -0.26
MAPLE LEAF 1 OZ............................................30.56 -0.35
LON PLATINUM AM .....................................1486.00 0.00
LON PALLADIUM AM.....................................629.00 3.00
ALUMINIUM CASH........................................1881.50 -32.50
COPPER CASH.............................................7475.00 -45.00
LEAD CASH .................................................1893.00 -21.00
NICKEL CASH............................................16620.00 15.00
TIN CASH..................................................19425.00 -125.00
ZINC CASH..................................................1894.00 -13.50
BRENT SPOT INDEX ........................................96.54 -1.19
SOYA ...........................................................1384.25 8.25
COCOA.........................................................2174.00 -45.00
COFFEE..........................................................149.55 -0.50
KRUG...........................................................1681.20 1.90
WHEAT..........................................................158.38 1.88
AIR LIQUIDE......................................................88.99 1.04 92.79 73.38
ALLIANZ ...........................................................75.00 1.12 98.60 56.16
ANHEUS-BUSCHINBEV.....................................56.43 0.32 57.51 33.85
ARCELORMITTAL.................................................12.16 0.63 24.77 10.47
ASML HOLDING................................................40.20 0.53 40.32 21.22
AXA...................................................................10.08 0.36 15.94 7.88
BANCO SANTANDER...........................................4.83 0.13 7.57 4.17
BASF SE..............................................................57.19 1.09 69.80 42.19
BAYER...............................................................54.79 1.47 58.64 35.36
BBVA...................................................................5.16 0.13 8.06 4.52
BMW.................................................................57.93 0.79 73.95 43.49
BNP PARIBAS....................................................28.93 0.76 54.98 22.72
CARREFOUR ......................................................14.27 0.24 24.89 13.38
CRH PLC.............................................................14.25 0.20 16.93 10.28
DAIMLER...........................................................35.40 0.66 53.95 29.02
DANONE...........................................................48.70 -3.13 54.96 41.92
DEUTSCHE BANK ..............................................28.62 0.46 42.08 20.79
DEUTSCHE TELEKOM ...........................................8.27 0.17 10.94 7.69
E.ON..................................................................15.47 0.26 20.00 12.50
ENEL...................................................................2.30 0.05 4.61 2.23
ENI ....................................................................16.38 0.39 18.72 11.83
ESSILOR INTERNAT ............................................74.53 1.13 75.52 46.89
FRANCE TELECOM................................................9.87 0.20 14.73 9.45
GDF SUEZ..........................................................16.99 0.16 25.44 15.62
GENERALI ASS.....................................................9.91 0.53 14.95 8.16
IBERDROLA.........................................................3.48 0.16 5.88 3.03
INDITEX............................................................78.00 2.37 78.30 52.20
ING GROEP CVA..................................................5.02 0.24 8.72 4.21
INTESA SANPAOLO ..............................................1.03 0.05 1.92 0.85
KON.PHILIPS ELECTR..........................................14.91 0.13 18.06 12.01
L'OREAL.............................................................91.42 0.09 94.80 68.83
LVMH...............................................................121.50 3.15 136.80 94.16
MUNICHRE......................................................105.70 1.95 118.35 77.80
NOKIA.................................................................1.99 0.03 5.19 1.79
REPSOL YPF.......................................................12.58 0.37 24.35 11.64
RWE ..................................................................30.17 0.63 39.24 21.15
SAINT-GOBAIN..................................................27.50 0.84 45.38 25.77
SANOFI ..............................................................57.74 1.42 59.56 42.85
SAP...................................................................47.68 0.99 54.85 32.88
SCHNEIDER ELECTRIC........................................43.47 1.37 58.85 35.00
SIEMENS.............................................................67.15 0.94 96.19 62.13
SOCIETE GENERALE............................................17.48 0.46 42.64 14.32
TELEFONICA........................................................9.87 0.37 16.61 8.81
TOTAL................................................................35.30 0.51 42.97 29.40
UNIBAIL-RODAMCO SE....................................142.80 3.45 162.95 123.30
UNICREDIT..........................................................2.58 0.11 10.13 2.20
UNILEVER CVA ..................................................25.53 -0.10 27.16 20.96
VINCI.................................................................34.47 0.84 44.79 28.46
VIVENDI ............................................................13.96 0.36 18.61 12.02
VOLKSWAGEN VORZ........................................126.40 1.75 152.20 86.40
Price Chg High Low
EU SHARES
WORLD INDICES
FTSE 100 . . . . . . . . . . . . . . . . . . . . . 5586.31 95.22 1.73
FTSE 250 INDEX. . . . . . . . . . . . . . . 10870.93 149.49 1.39
FTSE UK ALL SHARE . . . . . . . . . . . . 2895.44 47.60 1.67
FTSE AIM ALL SH . . . . . . . . . . . . . . . . 679.16 4.64 0.69
DOWJONES INDUS 30 . . . . . . . . . . 12837.33 95.51 0.75
S&P 500. . . . . . . . . . . . . . . . . . . . . . 1357.98 13.20 0.98
NASDAQ COMPOSITE. . . . . . . . . . . . 2929.76 34.43 1.19
FTSEUROFIRST 300 . . . . . . . . . . . . . 1009.55 15.88 1.60
NIKKEI 225 . . . . . . . . . . . . . . . . . . . 8655.87 -65.15 -0.75
DAX 30 PERFORMANCE . . . . . . . . . 6363.36 115.16 1.84
CAC 40 . . . . . . . . . . . . . . . . . . . . . . . 3117.92 51.73 1.69
SHANGHAI SE INDEX . . . . . . . . . . . 2300.80 -15.26 -0.66
HANG SENG. . . . . . . . . . . . . . . . . . 19416.67 -11.14 -0.06
S&P/ASX 20 INDEX. . . . . . . . . . . . . 2485.60 -3.00 -0.12
ASX ALL ORDINARIES . . . . . . . . . . . 4167.40 -16.50 -0.39
BOVESPA SAO PAOLO . . . . . . . . . . 57195.49 1000.28 1.78
ISEQ OVERALL INDEX . . . . . . . . . . . 3088.29 16.15 0.53
STRAITS TIMES. . . . . . . . . . . . . . . . . 2787.46 -9.62 -0.34
IGBM . . . . . . . . . . . . . . . . . . . . . . . . . 677.32 17.16 2.60
SWISS MARKET INDEX. . . . . . . . . . . 6034.13 95.37 1.61
Price Chg %chg
3M.....................................................................87.82 0.51 98.19 68.63
ABBOTT LABS ...................................................62.87 0.17 63.20 46.29
ALCOA................................................................8.90 0.21 16.60 8.21
ALTRIA GROUP .................................................33.92 0.07 34.08 23.20
AMAZON.COM.................................................224.03 1.37 246.71 166.97
AMERICAN EXPRESS ........................................56.94 1.09 61.42 41.30
APPLE..............................................................587.41 1.63 644.00 310.50
AT&T .................................................................35.47 -0.16 36.00 27.29
BANK OF AMERICA ..............................................8.11 0.35 11.25 4.92
BOEING CO........................................................72.92 1.02 77.83 56.01
BRISTOL MYERS SQUI .......................................34.83 0.25 35.44 20.05
CATERPILLAR....................................................88.84 2.10 116.95 67.54
CHEVRON.......................................................104.06 0.60 112.28 86.68
CISCO SYSTEMS...................................................17.18 0.04 21.30 13.30
CITIGROUP .......................................................28.50 0.95 43.06 21.40
COCA-COLA.......................................................75.74 -0.24 77.82 63.34
COMCAST CLASS A..............................................31.31 0.15 31.65 19.19
CONOCOPHILLIPS..............................................55.64 0.57 80.13 50.62
CVS/CAREMARK...............................................46.25 0.58 46.41 31.30
DU PONT(EI) DE NMR .......................................51.06 0.74 57.50 37.10
EXXON MOBIL...................................................84.48 1.37 87.94 63.47
GENERAL ELECTRIC..........................................20.00 0.25 21.00 14.02
GOOGLE A .......................................................581.53 10.68 670.25 473.02
HEWLETT PACKARD ..........................................20.81 -0.24 37.70 19.92
HOME DEPOT....................................................52.97 0.65 53.22 28.13
IBM .................................................................198.93 0.64 210.69 157.13
INTEL CORP........................................................27.51 0.09 29.27 19.16
J.P.MORGAN CHASE ..........................................35.38 0.76 46.49 27.85
JOHNSON & JOHNSON......................................66.72 0.42 68.05 55.76
KRAFT FOODS A...............................................39.00 0.02 39.99 31.88
MC DONALD'S CORP.........................................89.60 -0.64 102.22 81.40
MERCK AND CO. NEW.......................................39.23 0.38 39.50 29.47
MICROSOFT ......................................................30.70 0.86 32.95 23.79
OCCID. PETROLEUM...........................................84.01 0.20 109.08 66.36
ORACLE CORP ...................................................27.96 0.84 34.13 24.72
PEPSICO............................................................69.31 -0.29 70.75 58.50
PFIZER...............................................................22.71 0.09 23.30 16.63
PHILIP MORRIS INTL .........................................88.52 0.39 91.05 60.45
PROCTER AND GAMBLE.....................................62.21 -0.08 67.95 57.56
QUALCOMM INC.................................................57.02 0.25 68.87 45.98
SCHLUMBERGER................................................67.15 0.61 95.53 54.79
TRAVELERS CIES ...............................................63.45 0.38 65.27 45.97
UNITED TECHNOLOGIE......................................76.40 1.40 91.83 66.87
UNITEDHEALTH GROUP....................................60.26 0.84 60.75 41.27
US BANCORP DELAWRE ....................................31.76 0.24 32.98 20.10
VERIZON COMMS ..............................................43.73 -0.09 44.14 32.28
VISA CL A.........................................................121.35 1.25 125.35 73.11
WAL-MART STORES...........................................67.81 -0.31 68.48 48.31
WALT DISNEY CO ...............................................47.51 0.41 48.00 28.19
WELLS FARGO & CO..........................................32.96 0.50 34.59 22.58
COMMODITIES CREDIT & RATES
BoE IR Overnight.........................................0.500 0.00
BoE IR 7 days..............................................0.500 0.00
BoE IR 1 month...........................................0.500 0.00
BoE IR 3 months.........................................0.500 0.00
BoE IR 6 months ........................................0.500 0.00
LIBOR Euro - overnight ...............................0.260 0.00
LIBOR Euro - 12 months.................................1.193 0.00
LIBOR USD - overnight.................................0.164 0.00
LIBOR USD - 12 months................................1.069 0.00
Halifax mortgage rate ................................3.990 -0.02
Euro Base Rate.............................................1.500 0.00
Finance house base rate..............................1.500 0.00
US Fed funds ...............................................0.250 0.00
US long bond yield......................................2.730 0.06
European repo rate.......................................0.171 0.00
Euro Euribor .................................................0.321 0.00
The vix index................................................18.38 0.06
The baltic dry index ....................................938.0 14.00
Markit iBoxx ...............................................248.81 -1.68
Markit iTraxx...............................................176.63 1.96
Price Chg High Low
Price Chg %chg Price Chg %chg Price Chg %chg
US SHARES
BAE Systems . . . . . . . . .287.7 5.3 333.0 248.1
Chemring Group . . . . . .293.5 -29.9 648.5 286.0
Cobham. . . . . . . . . . . . .234.7 3.2 239.5 165.9
Meggitt . . . . . . . . . . . . .370.6 2.6 413.5 304.9
QinetiQ Group . . . . . . . .151.0 1.8 159.3 101.5
Rolls-Royce Holdi . . . . .844.0 4.5 859.0 557.5
Senior . . . . . . . . . . . . . . .187.4 0.3 213.0 135.6
Ultra Electronics . . . . .1628.0 -2.0 1780.0 1305.0
GKN . . . . . . . . . . . . . . . . .181.3 3.5 245.0 157.0
Bank of Georgia H . . .1008.0 0.0 1120.0 929.8
Barclays . . . . . . . . . . . .200.6 4.6 265.6 138.9
HSBC Holdings . . . . . . .560.5 13.8 629.1 463.5
Lloyds Banking Gr . . . . .30.9 0.7 50.8 21.8
Royal Bank of Sco . . . . .243.3 8.0 396.9 173.4
Standard Chartere . . . .1417.0 48.5 1672.0 1169.5
Barr (A.G.) . . . . . . . . . . .415.9 -4.1 449.7 343.7
Britvic . . . . . . . . . . . . . . .321.4 5.2 399.5 289.9
Diageo . . . . . . . . . . . . .1590.5 -11.5 1614.5 1112.0
SABMiller . . . . . . . . . . .2519.0 40.5 2660.0 1979.0
AZ Electronic Mat . . . . .290.8 -5.5 323.5 206.1
Croda Internation . . . .2225.0 18.0 2316.0 1597.0
Elementis . . . . . . . . . . .196.6 0.9 211.8 107.5
Johnson Matthey . . . .2278.0 29.0 2408.0 1523.0
Victrex . . . . . . . . . . . . .1279.0 -12.0 1590.0 1025.0
Yule Catto & Co . . . . . . .188.3 1.1 253.0 148.0
€/$ 1.2687 0.0109
€/£ 0.8067 0.0038
€/¥ 100.15 0.6267
/€ 1.2396 0.0052
/$ 1.5726 0.0061
/¥ 124.15 0.2217
FTSE 100
5586.31
95.22
FTSE 250
10870.93
149.49
FTSE ALL SHARE
2895.44
47.60
DOW
12837.33
95.51
NASDAQ
2929.76
34.43
S&P 500
1357.98
13.20
Brown (N.) Group . . . . .249.1 4.1 291.0 222.4
Carpetright . . . . . . . . . .728.5 48.0 753.0 375.0
Debenhams . . . . . . . . . .82.7 2.9 85.5 51.2
Dignity . . . . . . . . . . . . . .819.0 12.5 868.0 727.0
Dixons Retail . . . . . . . . .15.9 2.3 19.6 9.4
DunelmGroup . . . . . . .479.9 14.9 533.0 389.0
Halfords Group . . . . . . .244.0 5.0 402.4 235.6
Home Retail Group . . . . .91.9 17.5 166.9 69.2
Inchcape . . . . . . . . . . . .343.2 11.9 425.4 268.1
JD Sports Fashion . . . . .642.0 15.5 1030.0 570.0
Kingfisher . . . . . . . . . . .284.0 10.7 313.8 217.0
Marks & Spencer G . . . .335.6 9.6 389.5 301.8
Next . . . . . . . . . . . . . . .3199.0 81.0 3203.0 2153.0
Sports Direct Int . . . . . .303.0 11.0 315.6 190.0
Ted Baker . . . . . . . . . . .900.0 0.0 928.5 633.0
WHSmith . . . . . . . . . . .505.5 10.2 559.0 451.6
NMC Health . . . . . . . . . .199.7 -2.8 230.0 188.8
Smith & Nephew . . . . . .613.0 7.5 686.5 521.0
Synergy Health . . . . . . .917.5 2.5 981.0 762.5
Barratt Developme . . . .136.5 0.0 151.5 67.5
Bellway . . . . . . . . . . . . .797.0 7.0 859.5 540.5
Berkeley Group Ho . . .1282.0 9.0 1414.0 1025.0
Bovis Homes Group . . .430.2 -0.7 518.5 326.5
Balfour Beatty . . . . . . .285.8 6.1 323.8 214.6
CRH . . . . . . . . . . . . . . . .1150.0 27.0 1547.0 1052.0
Galliford Try . . . . . . . . .586.0 -2.5 653.0 383.8
Kier Group . . . . . . . . . .1280.0 24.0 1489.0 1095.0
Drax Group . . . . . . . . . .555.0 0.5 581.5 453.0
SSE . . . . . . . . . . . . . . . .1388.0 15.0 1423.0 1193.0
Domino Printing S . . . .550.0 -15.0 701.5 434.3
Halma . . . . . . . . . . . . . .400.4 19.7 429.6 306.3
Laird . . . . . . . . . . . . . . . .187.8 3.2 222.0 128.5
Morgan Crucible C . . . .283.0 1.8 360.0 224.0
Oxford Instrument . . .1220.0 32.0 1285.0 714.0
Renishaw . . . . . . . . . . .1422.0 6.0 1886.0 800.0
Spectris . . . . . . . . . . . .1495.0 25.0 1902.0 1039.0
Aberforth Smaller . . . .562.5 8.5 714.0 494.0
Alliance Trust . . . . . . . .350.7 5.3 392.7 310.2
Bankers Inv Trust . . . . .401.6 2.1 433.8 346.5
BH Global Ltd. GB . . . . .1142.0 2.0 1212.0 1085.0
BH Global Ltd. US . . . . . . .11.5 0.2 12.2 10.8
BH Macro Ltd. EUR . . . . . .18.9 0.0 20.2 16.9
BH Macro Ltd. GBP . . . .1935.0 1.0 2078.0 1745.0
BH Macro Ltd. USD . . . . . .18.7 -0.2 20.2 16.8
BlackRock World M . . . .577.5 8.5 782.0 567.5
BlueCrest AllBlue . . . . . .165.6 0.1 174.3 160.5
British Assets Tr . . . . . . .116.5 3.8 137.6 109.0
British Empire Se . . . . .409.0 5.7 530.0 386.6
Caledonia Investm . . .1395.0 44.0 1780.0 1237.0
City of London In . . . . .293.0 6.8 306.9 257.0
Dexion Absolute L . . . . .134.3 0.2 146.5 130.0
Edinburgh Dragon . . . .231.9 3.8 253.1 201.4
Edinburgh Inv Tru . . . . .483.7 11.3 504.0 422.5
Electra Private E . . . . . .1612.0 7.0 1740.0 1287.0
Fidelity China Sp . . . . . . .75.7 0.8 102.9 70.0
Fidelity European . . . .1064.0 21.0 1280.0 912.0
Foreign and Colon . . . .295.7 4.2 327.9 261.5
Herald Inv Trust . . . . . .465.8 6.3 545.5 419.0
HICL Infrastructu . . . . . .120.4 0.0 123.6 112.7
John Laing Infras . . . . . .108.1 0.4 110.6 103.8
JPMorgan American . . .875.0 15.5 965.5 721.5
JPMorgan Asian In . . . . .177.6 3.6 243.9 170.1
JPMorgan Emerging . . .526.0 9.5 610.5 480.1
JPMorgan Indian I . . . . .321.7 2.7 437.0 303.4
LawDebenture Cor . . . .368.5 7.8 398.7 323.0
Mercantile Invest . . . . .950.5 20.0 1090.0 823.0
Merchants Trust . . . . . .363.0 8.6 427.7 341.5
Monks Inv Trust . . . . . .320.0 5.8 357.4 298.1
Murray Income Tru . . . .638.0 17.0 674.0 568.0
Murray Internatio . . . . .951.0 13.5 1012.0 818.5
NB Global Floatin . . . . . .96.5 0.0 103.0 92.5
Perpetual Income . . . .263.5 6.2 273.8 236.5
Personal Assets T . . .34700.0 350.036000.031900.0
Polar Capital Tec . . . . . .363.5 3.3 404.0 299.5
RIT Capital Partn . . . . .1241.0 27.0 1360.0 1096.0
Scottish Inv Trus . . . . . .451.4 6.5 524.0 417.0
Scottish Mortgage . . . .652.5 15.0 781.0 565.0
SVG Capital . . . . . . . . . .282.8 5.8 295.5 165.1
Temple Bar Inv Tr . . . . .905.0 23.0 970.0 791.0
Templeton Emergin . . .535.5 9.0 678.5 497.0
TRProperty Inv T . . . . . .149.1 4.1 206.1 136.2
TRProperty Inv T . . . . . .64.3 1.7 94.0 59.8
Utilico Emerging . . . . .166.9 3.9 169.5 133.8
Witan Inv Trust . . . . . . .451.0 10.5 533.0 401.5
3i Group . . . . . . . . . . . . .180.8 4.1 292.1 166.9
3i Infrastructure . . . . . . .123.6 0.4 128.0 115.6
Aberdeen Asset Ma . . . .257.4 5.4 283.8 167.8
Ashmore Group . . . . . . .341.7 0.8 420.0 306.4
Brewin Dolphin Ho . . . .139.5 -0.7 177.0 113.7
Camellia . . . . . . . . . . .9450.0-307.0 10700.0 8800.0
Charles Taylor . . . . . . . .148.5 1.5 160.0 115.6
City of London Gr . . . . . .73.0 0.0 83.5 61.3
City of London In . . . . . .325.3 2.3 440.0 304.3
Close Brothers Gr . . . . .732.5 19.5 812.0 590.0
F&C Asset Managem . . . .81.5 2.0 82.4 56.1
Hargreaves Lansdo . . .495.9 11.3 629.5 402.5
Helphire Group . . . . . . . . . .1.1 0.1 4.0 1.0
Henderson Group . . . . .103.0 1.0 163.7 92.9
Highway Capital . . . . . . .14.0 0.0 19.5 12.0
ICAP . . . . . . . . . . . . . . . .368.4 6.2 498.8 311.6
IG Group Holdings . . . .474.8 0.7 502.5 393.6
Intermediate Capi . . . . .257.0 1.0 338.4 197.9
International Per . . . . .243.3 4.7 388.8 148.5
International Pub . . . . . .117.2 0.8 121.6 112.6
Investec . . . . . . . . . . . . .375.0 5.8 522.0 310.4
Jupiter Fund Mana . . . .213.5 1.3 260.2 184.9
Liontrust Asset M . . . . . .95.5 0.0 125.0 57.9
LMS Capital . . . . . . . . . . .64.5 -1.3 65.8 54.0
London Finance & . . . . .19.5 0.0 23.5 18.0
London Stock Exch . . . .984.5 11.0 1093.0 756.5
Lonrho . . . . . . . . . . . . . . .9.0 -0.2 19.0 8.5
Man Group . . . . . . . . . . . .73.1 -1.3 259.6 69.2
Paragon Group Of . . . .164.0 0.0 200.7 134.6
Provident Financi . . . . .1170.0 20.0 1204.0 915.0
Rathbone Brothers . . .1186.0 -4.0 1351.0 977.0
Real Estate Credi . . . . . . .86.5 0.0 143.0 79.5
Record . . . . . . . . . . . . . . .16.9 0.3 35.5 9.8
RSM Tenon Group . . . . . . .5.1 0.1 31.5 4.8
S & U . . . . . . . . . . . . . . .855.0 20.0 858.0 547.5
Schroders . . . . . . . . . .1280.0 25.0 1665.0 1166.0
Tullett Prebon . . . . . . . .294.7 1.7 386.4 262.3
Walker Crips Grou . . . . .40.5 0.0 51.5 38.0
BT Group . . . . . . . . . . . .203.7 1.8 232.1 161.0
Cable & Wireless . . . . . .29.0 -0.0 45.2 27.3
Cable & Wireless . . . . . .37.8 0.0 52.5 14.2
COLT Group SA . . . . . . . .125.8 1.9 144.5 84.1
KCOM Group . . . . . . . . . . .71.3 -0.5 84.0 65.6
TalkTalk Telecom . . . . . .173.7 5.5 176.4 118.9
TelecomPlus . . . . . . . . .838.0 8.5 863.0 550.0
Booker Group . . . . . . . . .88.5 0.8 89.1 66.2
Greggs . . . . . . . . . . . . . .493.3 -0.4 558.0 445.0
Morrison (Wm) Sup . . .276.3 -2.6 328.0 267.3
Ocado Group . . . . . . . . .104.5 2.8 207.0 52.9
Sainsbury (J) . . . . . . . . .288.5 0.5 334.2 263.5
Tesco . . . . . . . . . . . . . . .307.9 4.2 411.5 297.1
Associated Britis . . . . .1224.0 -5.0 1242.0 977.0
Cranswick . . . . . . . . . . .808.0 -2.0 841.0 588.5
Dairy Crest Group . . . . .330.1 -1.4 387.1 290.4
Devro . . . . . . . . . . . . . . .308.7 4.7 332.2 232.0
Tate & Lyle . . . . . . . . . .638.0 -8.5 720.5 544.5
Unilever . . . . . . . . . . .2075.0 -12.0 2189.0 1892.0
Mondi . . . . . . . . . . . . . . .551.0 15.5 664.0 413.5
Centrica . . . . . . . . . . . . . .315.1 5.5 330.3 278.8
International Pow . . . . .417.5 0.9 419.4 279.4
National Grid . . . . . . . .655.0 1.5 684.5 569.0
Pennon Group . . . . . . . .745.0 11.0 751.0 623.5
Severn Trent . . . . . . . .1749.0 3.0 1796.0 1375.0
United Utilities . . . . . . .669.5 8.5 680.5 560.0
Cookson Group . . . . . . .626.5 16.0 747.5 395.8
Rexam . . . . . . . . . . . . . .407.5 0.4 438.0 299.8
RPC Group . . . . . . . . . . .383.2 -0.1 397.0 300.5
Smith (DS) . . . . . . . . . . .140.4 0.1 183.7 113.3
Smiths Group . . . . . . .1000.0 2.5 1212.0 869.5
Price Chg High Low
Persimmon . . . . . . . . . .593.5 3.5 706.5 374.0
Reckitt Benckiser . . . .3397.0 8.0 3660.0 3100.0
Redrow . . . . . . . . . . . . . .115.0 1.4 126.0 90.2
Taylor Wimpey . . . . . . . .47.3 1.0 52.8 28.7
Bodycote . . . . . . . . . . . .340.2 4.9 437.1 225.6
Fenner . . . . . . . . . . . . . .349.2 9.0 483.7 280.0
IMI . . . . . . . . . . . . . . . . .865.5 30.5 1119.0 636.5
Melrose . . . . . . . . . . . . .376.3 5.7 441.6 268.0
Rotork . . . . . . . . . . . . .1899.0 1.0 2260.0 1501.0
Spirax-Sarco Engi . . . .1980.0 0.0 2334.0 1649.0
Weir Group . . . . . . . . .1503.0 66.0 2236.0 1375.0
Evraz . . . . . . . . . . . . . . .283.9 8.9 460.5 255.7
Ferrexpo . . . . . . . . . . . .218.4 8.5 495.3 179.4
Talvivaara Mining . . . . .164.5 3.0 465.0 129.0
BBA Aviation . . . . . . . .205.0 0.5 222.4 156.0
Stobart Group Ltd . . . . .118.2 0.7 145.0 110.3
Admiral Group . . . . . . .1155.0 31.0 1678.0 787.0
Amlin . . . . . . . . . . . . . .340.7 7.7 417.9 270.6
Beazley . . . . . . . . . . . . . .137.5 0.5 151.8 109.6
Catlin Group Ltd. . . . . . .424.6 6.8 449.0 337.0
Hiscox Ltd. . . . . . . . . . . .424.3 1.5 426.8 340.5
Johnston Press . . . . . . . . .4.9 0.0 7.9 4.1
MecomGroup . . . . . . . . .69.5 1.5 242.0 65.0
Moneysupermarket. . . . .117.7 1.7 135.9 93.4
Pearson . . . . . . . . . . . .1207.0 19.0 1255.0 1038.0
PerformGroup . . . . . . .373.0 -5.0 388.2 150.0
Reed Elsevier . . . . . . . .486.9 5.5 578.0 461.3
Rightmove . . . . . . . . . .1522.0 -8.0 1600.0 1058.0
STV Group . . . . . . . . . . . .93.0 1.0 129.8 76.3
Tarsus Group . . . . . . . . .152.0 5.0 165.0 119.5
Trinity Mirror . . . . . . . . . .27.3 0.3 54.3 25.5
UBM . . . . . . . . . . . . . . . .568.5 21.5 641.5 416.0
UTVMedia . . . . . . . . . . .147.8 2.8 159.5 92.5
Wilmington Group . . . . .87.5 1.3 120.8 78.5
WPP . . . . . . . . . . . . . . . .767.0 14.0 880.0 578.0
Yell Group . . . . . . . . . . . . .1.2 -0.0 11.0 1.2
African Barrick G . . . . .399.0 -4.9 616.5 309.8
Anglo American . . . . .2170.0 41.5 3181.0 1955.5
Antofagasta . . . . . . . .1096.0 23.0 1491.0 900.5
Aquarius Platinum . . . . .60.2 1.2 322.6 58.4
Avocet Mining . . . . . . . .165.0 1.1 286.8 143.3
BHP Billiton . . . . . . . . .1863.5 34.5 2521.5 1667.0
Bumi . . . . . . . . . . . . . . .349.1 -9.7 1158.0 312.5
Centamin (DI) . . . . . . . . .69.1 0.2 141.5 60.7
Eurasian Natural . . . . .435.0 20.9 815.0 390.8
Fresnillo . . . . . . . . . . . .1549.0 -9.0 2150.0 1307.0
Jardine Lloyd Tho . . . . .726.5 -3.0 764.5 576.0
Lancashire Holdin . . . . .779.0 6.5 825.0 620.0
RSA Insurance Gro . . . .104.8 2.8 137.9 97.7
Aviva . . . . . . . . . . . . . . .266.6 6.1 446.3 255.3
Legal & General G . . . . .122.6 3.2 135.0 89.8
Old Mutual . . . . . . . . . . .157.2 4.8 188.1 112.1
Phoenix Group Hol . . . .471.9 16.1 614.5 405.3
Prudential . . . . . . . . . . .731.0 26.0 797.5 509.0
Resolution Ltd. . . . . . . .200.7 4.7 302.2 192.4
St James's Place . . . . . .335.7 12.7 376.0 294.0
Standard Life . . . . . . . .225.8 6.5 250.7 172.0
4Imprint Group . . . . . . .293.5 -2.0 312.5 200.0
Aegis Group . . . . . . . . .160.0 2.3 187.4 115.7
Bloomsbury Publis . . . .113.9 0.1 133.0 91.3
British Sky Broad . . . . .677.0 8.0 850.0 618.5
Centaur Media . . . . . . . . .33.3 -0.3 53.9 28.5
Chime Communicati . . .154.0 0.3 285.5 143.0
Creston . . . . . . . . . . . . . .52.0 -1.0 120.0 47.0
Euromoney Institu . . . .743.0 8.5 828.0 522.5
Future . . . . . . . . . . . . . . .12.8 0.0 18.8 8.3
Haynes Publishing . . . .175.0 0.0 255.0 170.0
Huntsworth . . . . . . . . . .44.8 -0.8 75.0 32.3
Informa . . . . . . . . . . . . .362.9 2.5 451.0 313.9
ITE Group . . . . . . . . . . . .186.1 0.2 240.6 157.7
ITV . . . . . . . . . . . . . . . . . .74.3 2.0 89.9 51.7
GemDiamonds Ltd. . . .202.0 0.8 310.6 179.8
Glencore Internat . . . . .330.0 1.6 503.0 328.4
Hochschild Mining . . . .490.5 4.5 549.5 365.9
Kazakhmys . . . . . . . . . .743.0 27.5 1405.0 665.0
Kenmare Resources . . . .44.1 0.6 61.5 31.0
Lonmin . . . . . . . . . . . . .786.0 9.5 1453.0 699.0
NewWorld Resourc . . . .322.1 5.2 928.5 269.0
Petra Diamonds Lt . . . .125.4 1.3 188.2 97.0
Petropavlovsk . . . . . . . .485.3 13.1 913.0 361.7
Polymetal Interna . . . .906.5 -3.0 1175.0 765.0
Randgold Resource . .6035.0 55.0 7565.0 4596.0
Rio Tinto . . . . . . . . . . .3051.0 88.5 4595.0 2712.5
Vedanta Resources . . .966.0 26.0 2095.0 883.5
Xstrata . . . . . . . . . . . . .864.9 5.7 1417.0 764.0
Inmarsat . . . . . . . . . . . .488.7 14.5 595.5 389.3
Vodafone Group . . . . . .178.4 3.5 182.7 155.1
Genesis Emerging . . . .469.7 6.9 543.5 424.0
Afren . . . . . . . . . . . . . . .107.3 1.1 165.1 73.6
BG Group . . . . . . . . . . .1284.0 53.0 1547.0 1144.0
BP . . . . . . . . . . . . . . . . .426.9 6.2 504.6 363.2
Cairn Energy . . . . . . . . .269.9 5.4 473.8 264.5
EnQuest . . . . . . . . . . . . . .117.1 0.1 132.6 85.7
Essar Energy . . . . . . . . .120.1 5.4 422.1 101.6
Heritage Oil . . . . . . . . . .129.3 4.1 262.1 115.1
Ophir Energy . . . . . . . . .635.5 9.5 638.5 184.5
Premier Oil . . . . . . . . . .355.6 3.1 472.0 310.0
Royal Dutch Shell . . . .2155.0 35.0 2402.0 1883.5
Royal Dutch Shell . . . .2225.0 32.0 2489.0 1890.5
Ruspetro . . . . . . . . . . . .130.9 0.9 230.0 125.0
Salamander Energy . . .183.0 2.1 235.8 148.0
Soco Internationa . . . . .305.5 5.2 371.5 254.9
TullowOil . . . . . . . . . . .1494.0 40.0 1601.0 945.5
Amec . . . . . . . . . . . . . .999.5 24.5 1171.0 740.5
Hunting . . . . . . . . . . . . .775.0 2.5 968.0 530.0
Kentz Corporation . . . .365.9 40.9 508.0 325.0
Petrofac Ltd. . . . . . . . . .1512.0 25.0 1772.0 1108.0
Wood Group (John) . . .703.5 8.5 798.0 469.9
Burberry Group . . . . . .1381.0 35.0 1600.0 1092.0
PZ Cussons . . . . . . . . . .328.9 0.7 380.0 285.0
AstraZeneca . . . . . . . .2760.0 77.0 3166.5 2543.5
BTG . . . . . . . . . . . . . . . .403.0 -0.1 406.5 236.8
Dechra Pharmaceut . . .498.0 9.6 524.8 392.5
Genus . . . . . . . . . . . . . .1163.0 32.0 1457.0 853.5
GlaxoSmithKline . . . . .1467.0 13.5 1497.0 1205.0
Hikma Pharmaceuti . . .683.0 10.5 789.0 555.5
Shire Plc . . . . . . . . . . .1946.0 29.0 2300.0 1784.0
Capital & Countie . . . . .200.0 -3.4 206.0 158.1
Daejan Holdings . . . . .2584.0 83.0 3300.0 2282.0
F&C Commercial Pr . . . .104.0 0.2 106.3 92.6
Grainger . . . . . . . . . . . . .85.2 2.1 133.2 77.3
London & Stamford . . .108.7 1.2 135.0 101.8
Raven Russia Ltd . . . . . . .57.9 1.7 67.5 47.3
Savills . . . . . . . . . . . . . .349.5 15.7 402.0 256.2
UK Commercial Pro . . . .70.3 0.0 82.2 65.1
Big Yellow Group . . . . .299.7 1.7 326.0 218.0
British Land Co . . . . . . .506.0 8.8 629.5 444.0
Capital Shopping . . . . .325.0 6.1 401.7 288.7
Derwent London . . . . .1844.0 -1.0 1886.0 1400.0
Great Portland Es . . . . .388.4 5.4 445.0 312.9
Hammerson . . . . . . . . .428.0 10.3 490.9 345.2
Hansteen Holdings . . . . .73.1 0.8 89.5 68.0
Land Securities G . . . . .744.5 12.5 885.0 612.0
SEGRO . . . . . . . . . . . . . .222.9 9.2 319.0 195.0
Shaftesbury . . . . . . . . . .511.0 3.5 537.0 441.2
Anite . . . . . . . . . . . . . . . .120.1 0.1 129.8 57.8
Aveva Group . . . . . . . .1581.0 -13.0 1799.0 1298.0
Computacenter . . . . . . .312.8 -1.2 490.0 311.5
Fidessa Group . . . . . . .1525.0 33.0 2109.0 1439.0
Invensys . . . . . . . . . . . .203.0 2.4 333.9 180.9
Logica . . . . . . . . . . . . . .108.0 0.8 135.6 59.0
Micro Focus Inter . . . . .445.5 8.7 476.7 242.9
Sage Group . . . . . . . . . .253.5 3.9 312.4 231.7
SDL . . . . . . . . . . . . . . . . .678.5 16.0 756.0 586.0
Telecity Group . . . . . . . .810.5 10.5 818.0 450.5
Aggreko . . . . . . . . . . .2085.0 5.0 2316.0 1522.0
Ashtead Group . . . . . . .240.6 7.4 271.1 99.4
Atkins (WS) . . . . . . . . .694.5 4.5 799.0 490.2
Babcock Internati . . . . .872.0 7.0 879.5 570.5
Berendsen . . . . . . . . . . .481.7 2.3 568.0 402.7
Bunzl . . . . . . . . . . . . . .1045.0 16.0 1063.0 676.5
Cape . . . . . . . . . . . . . . .258.3 3.6 591.5 205.0
Capita . . . . . . . . . . . . . .654.0 8.5 767.0 602.0
Carillion . . . . . . . . . . . . .275.0 1.2 387.0 253.5
De La Rue . . . . . . . . . . .995.0 6.5 1024.0 730.0
Diploma . . . . . . . . . . . .446.4 -2.0 460.5 284.0
Electrocomponents . . .207.8 3.5 274.5 182.2
Experian . . . . . . . . . . . .938.0 4.5 998.0 665.0
Filtrona PLC . . . . . . . . . .467.8 8.5 484.5 296.3
G4S . . . . . . . . . . . . . . . .280.3 5.3 292.1 219.9
Hays . . . . . . . . . . . . . . . .76.6 2.1 104.6 58.9
Homeserve . . . . . . . . . .153.7 2.6 522.0 137.5
Howden Joinery Gr . . . .123.1 2.3 130.8 93.1
Interserve . . . . . . . . . . .297.2 -4.5 341.3 270.1
Intertek Group . . . . . . .2571.0 -24.0 2697.0 1744.0
Menzies(John) . . . . . . .555.0 13.0 652.0 445.5
Michael Page Inte . . . . .377.0 1.0 552.5 323.0
Mitie Group . . . . . . . . . .274.4 0.5 296.7 208.0
PayPoint . . . . . . . . . . . .739.5 26.5 740.0 465.0
Premier Farnell . . . . . . .167.9 4.5 249.0 144.5
Regus . . . . . . . . . . . . . . . .91.7 0.6 117.5 64.0
Rentokil Initial . . . . . . . . .71.9 2.5 95.9 58.2
RPS Group . . . . . . . . . . .204.8 0.8 253.0 156.6
Serco Group . . . . . . . . . .551.5 3.5 565.0 458.0
Shanks Group . . . . . . . . .77.5 -0.2 129.8 77.2
SIG . . . . . . . . . . . . . . . . . .96.3 2.4 145.2 77.0
Travis Perkins . . . . . . . .957.0 18.0 1125.0 715.0
Wolseley . . . . . . . . . . .2322.0 89.0 2558.0 1404.0
ARM Holdings . . . . . . . .508.0 17.4 645.0 464.0
CSR . . . . . . . . . . . . . . . . .214.4 3.9 321.6 154.1
Imagination Techn . . . .456.9 -28.9 717.0 296.9
Spirent Communica . . .160.8 1.3 174.0 105.8
British American . . . .3192.0 54.0 3248.5 2592.0
Imperial Tobacco . . . .2407.0 7.0 2591.0 1974.0
Betfair Group . . . . . . . .770.5 11.5 901.0 567.0
Bwin.party Digita . . . . .124.7 5.8 174.0 100.6
Carnival . . . . . . . . . . . .2233.0 16.0 2465.0 1742.0
Compass Group . . . . . .646.0 15.0 671.0 512.5
Domino's Pizza Gr . . . . .487.1 -3.9 526.0 377.0
easyJet . . . . . . . . . . . . .523.5 12.5 534.0 302.5
FirstGroup . . . . . . . . . . .214.3 5.3 370.2 190.0
Go-Ahead Group . . . . .1215.0 20.0 1598.0 1086.0
Greene King . . . . . . . . .507.0 11.8 527.5 410.0
InterContinental . . . . .1535.0 43.0 1535.0 955.0
International Con . . . . .154.4 4.2 258.7 132.0
Ladbrokes . . . . . . . . . . .175.4 4.5 181.4 114.0
Marston's . . . . . . . . . . . .99.7 1.7 106.8 84.6
Millennium& Copt . . . .468.0 3.0 517.0 371.2
Mitchells & Butle . . . . . .249.0 6.0 320.8 215.6
National Express . . . . .199.0 5.0 262.4 180.0
Rank Group . . . . . . . . . . .117.5 -1.5 153.7 109.5
Restaurant Group . . . . .294.0 1.6 309.7 254.9
Spirit Pub Compan . . . . .48.5 -0.3 62.8 35.3
Stagecoach Group . . . . .248.1 2.2 287.4 220.0
TUI Travel . . . . . . . . . . . .167.0 3.6 231.8 136.7
Wetherspoon (J.D. . . . .412.9 6.1 449.9 371.3
Whitbread . . . . . . . . . .1967.0 118.0 2007.0 1409.0
WilliamHill . . . . . . . . . .274.7 4.8 281.7 183.3
Abcam . . . . . . . . . . . . . .418.8 1.3 460.0 320.0
Advanced Medical . . . . .67.5 -2.0 95.0 64.8
Albemarle & Bond . . . .272.0 7.0 400.1 265.0
Amerisur Resource . . . . .30.0 3.5 30.3 9.5
Andor Technology . . . .368.3 -0.3 685.0 355.0
Archipelago Resou . . . . .49.0 -3.0 79.0 48.1
ASOS . . . . . . . . . . . . . .1643.0 11.0 2422.0 1142.0
Aurelian Oil & Ga . . . . . . .15.5 0.3 71.0 14.5
Avanti Communicat . . .301.0 -4.0 436.5 241.3
Blinkx . . . . . . . . . . . . . . . .37.5 4.0 158.0 33.5
Borders & Souther . . . . .72.5 -1.5 131.0 43.5
BowLeven . . . . . . . . . . . .63.8 4.3 342.3 58.5
Brooks Macdonald . . .1175.0 0.0 1365.0 940.0
Cluf Gold . . . . . . . . . . . . .67.3 -0.8 112.8 63.3
Cove Energy . . . . . . . . .267.5 1.5 270.0 61.0
Daisy Group . . . . . . . . . .95.0 2.0 127.0 86.0
EMIS Group . . . . . . . . . .555.0 -15.0 585.0 397.5
Faroe Petroleum . . . . . .163.0 3.0 177.8 130.0
Gulfsands Petrole . . . . . .87.0 0.5 234.8 82.0
GWPharmaceutical . . . .82.5 -2.5 130.0 78.5
H&T Group . . . . . . . . . . .259.0 -14.5 395.0 253.0
Hargreaves Servic . . . .790.0 7.0 1264.0 752.5
Healthcare Locums . . . . . .3.4 0.1 3.5 3.0
IDOX . . . . . . . . . . . . . . . . .39.3 0.0 39.3 20.9
ImpellamGroup . . . . . .337.5 0.0 375.0 225.0
Iomart Group . . . . . . . .140.0 2.6 151.0 93.5
James Halstead . . . . . . .527.5 14.5 535.8 410.3
London Mining . . . . . . .214.0 2.8 405.0 205.8
Lupus Capital . . . . . . . . .131.0 2.0 133.0 86.0
M. P. Evans Group . . . . .488.5 3.0 525.0 371.0
Majestic Wine . . . . . . . .410.3 7.3 510.0 315.0
May Gurney Integr . . . .242.5 6.8 302.0 226.0
Monitise . . . . . . . . . . . . . .31.5 0.3 40.0 25.5
Mulberry Group . . . . .1566.0 -84.0 2472.0 1295.0
Nanoco Group . . . . . . . .64.3 0.3 85.8 38.0
Nautical Petroleu . . . . .464.0 2.3 468.0 223.5
Nichols . . . . . . . . . . . . .700.0 -1.0 732.0 505.0
Numis Corporation . . . . .90.5 0.0 119.6 72.0
Pan African Resou . . . . . .15.5 0.5 18.3 10.3
Patagonia Gold . . . . . . . .26.3 -2.0 70.0 22.0
Prezzo . . . . . . . . . . . . . . .68.3 0.3 70.0 53.5
Rockhopper Explor . . . .283.0 4.5 393.5 141.0
RWS Holdings . . . . . . . .510.0 18.0 560.0 400.0
Secure Trust Bank . . . .1030.0 0.0 1077.5 755.0
Sirius Minerals . . . . . . . . .15.8 0.3 32.0 6.4
Smart Metering Sy . . . .182.0 -4.5 186.5 75.0
Songbird Estates . . . . . .105.0 4.0 157.0 100.0
Valiant Petroleum . . . .400.5 -10.5 603.0 385.0
Young & Co's Brew . . . .601.5 -2.5 712.0 580.0
Home Retail Group . . . . . . . . . . . .91.9 23.5
Dixons Retail . . . . . . . . . . . . . . . .15.9 17.0
Kentz Corporation . . . . . . . . . . .365.9 12.6
Carpetright . . . . . . . . . . . . . . . . .728.5 7.1
Whitbread . . . . . . . . . . . . . . . . .1967.0 6.4
Halma . . . . . . . . . . . . . . . . . . . .400.4 5.2
Eurasian Natural R . . . . . . . . . . .435.0 5.1
Bwin.party Digital . . . . . . . . . . . .124.7 4.9
Essar Energy . . . . . . . . . . . . . . . .120.1 4.7
Savills . . . . . . . . . . . . . . . . . . . . .349.5 4.7
Chemring Group . . . . . . . . . . . . .293.5 -9.3
Imagination Techno . . . . . . . . .456.9 -6.0
Bumi . . . . . . . . . . . . . . . . . . . . . .349.1 -2.7
Domino Printing Sc . . . . . . . . . .550.0 -2.7
AZ Electronic Mate . . . . . . . . . . .290.8 -1.9
Man Group . . . . . . . . . . . . . . . . . . .73.1 -1.8
Capital & Counties . . . . . . . . . . .200.0 -1.7
Interserve . . . . . . . . . . . . . . . . . .297.2 -1.5
NMC Health . . . . . . . . . . . . . . . . .199.7 -1.4
PerformGroup . . . . . . . . . . . . . .373.0 -1.3
Risers FaIIers
MAIN CHANGES UK 350
Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low
Price Chg High Low Price Chg High Low
GILTS
http://corporate.webfg.com
mailto:
globaltechsales@webfg.com
Tsy 9.000 12 . . . . . .100.00 -1.10 109.2 100.0
Tsy 2.500 13 . . . . . .282.35 -0.24 287.3 282.2
Tsy 8.000 13 . . . . . .109.83 -0.03 116.0 109.8
Tsy 4.500 13 . . . . . .103.00 -0.02 106.4 103.0
Tsy 5.000 14 . . . . . . .110.52 -0.01 112.9 110.3
Tsy 4.750 15 . . . . . . .114.10 0.03 115.4 111.5
Tsy 8.000 15 . . . . . . .126.43 0.03 129.2 125.8
Tsy 2.500 16 . . . . . . .345.01 -0.26 348.1 330.2
Tsy 4.000 16 . . . . . . .114.29 0.01 114.7 108.6
Tsy 1.250 17 . . . . . . . .115.53 -0.34 117.1 110.5
Tsy 8.750 17 . . . . . . .140.42 -0.10 141.9 135.6
Tsy 12.000 17 . . . . . .118.25 0.89 126.8 116.0
Tsy 5.000 18 . . . . . . .122.79 -0.04 123.6 114.2
Tsy 3.750 19 . . . . . . . .117.14 -0.19 118.7 104.4
Tsy 4.500 19 . . . . . . .121.68 -0.15 123.3 110.3
Tsy 4.750 20 . . . . . . .124.71 -0.24 126.7 111.3
Tsy 2.500 20 . . . . . .368.34 -0.39 373.0 334.7
Tsy 8.000 21 . . . . . . .154.23 -0.36 157.1 139.3
Tsy 1.875 22 . . . . . . .127.96 -0.54 130.3 114.9
Tsy 4.000 22 . . . . . .120.32 -0.43 122.4 103.4
Tsy 2.500 24 . . . . . .333.37 -0.56 339.0 292.4
Tsy 5.000 25 . . . . . .132.85 -0.49 135.4 111.5
Tsy 1.250 27 . . . . . . .123.68 -0.85 127.0 108.4
Tsy 4.250 27 . . . . . . .124.57 -0.58 127.2 101.7
Tsy 6.000 28 . . . . . .149.71 -0.53 152.7 123.7
Tsy 4.125 30 . . . . . . .315.88 -0.77 322.8 279.7
Tsy 4.750 30 . . . . . . .131.98 -0.65 135.0 107.3
Tsy 4.250 32 . . . . . . .123.67 -0.66 126.9 100.3
Tsy 4.250 36 . . . . . .122.67 -0.67 127.0 99.6
Tsy 4.750 38 . . . . . . .131.91 -0.69 137.2 107.9
Tsy 4.500 42 . . . . . . .127.33 -0.67 133.6 104.1
% %
AUTOMOBILES & PARTS
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MINING
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REAL ESTATE INVEST. TRUSTS
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TOBACCO
TRAVEL & LEISURE
AIM 50
D
EMANDS for government
intervention to limit
executive pay are misguided.
As the WPP vote against Sir
Martin Sorrell’s pay and
other AGMs this spring showed,
shareholders can act – corporate
governance is their responsibility.
The only way that governments can
improve corporate governance is by
removing obstacles to shareholder
action.
Government regulation of
corporate governance is not justified
by envy or inequality, or by gaps
between aggregated remuneration
levels and averaged share
performance. When unequal
payouts reward unequal
contributions, they are not an
indication of unfairness or market
B
RITAIN is on the verge of
losing its foreign direct
investment (FDI) crown. After
a 15 year record as the leading
European destination, the
investment tide has begun to flow
away. While the UK remains Europe’s
top destination for inward projects,
we will lose this crown to Germany,
within two years, unless action is
taken.
Our annual survey, out today, which
analyses inward investment and the
perceptions of global investors, shows
the challenge we face in maintaining
the lead in attracting foreign compa-
nies, particularly from new markets.
The UK is favoured by investors due
to its culture, stable political infra-
structure, role as gateway to Europe,
and its reputation for financial servic-
es. These factors have opened doors to
investors for decades.
Investment is now even more crucial
as we chase new forms of innovation,
jobs and growth. Last year the UK won
679 projects from foreign companies,
creating nearly 30,000 jobs.
The deterioration in the UK’s posi-
FLIGHTS STRAIGHT F
FROM £63
ONE
WAY*

*Fare available from London City Airport to Dublin. Price valid as of 19 June. Subject to terms, conditions and availability.
cityam.com/forum
The UK’s position
has deteriorated – a 7
per cent overall decline
in foreign projects
In association with
THEFORUM
Twitter: @cityamforum on the web: cityam.com/forum or by email: theforum@cityam.com
Agree? Disagree? Got a sharp comment?
The Forumwants you to join the debate.
Top responses will be reprinted in The Forum.

22
WEDNESDAY 20 JUNE 2012
STEVE VARLEY
What Britain must do to win back
investors from a surging Germany
tion is severe, with an overall 7 per
cent decline in foreign projects.
Financial services investment, a tradi-
tional source of FDI, dropped by 15 per
cent. In contrast, Germany’s share of
overall inward investment rose by 15
per cent, leaving it only 2 per cent
behind the UK. For the first time in 15
years, Germany secured a higher share
of manufacturing projects and over-
took the UK in securing investment
from Japan. Germany also swept up
investment from Bric countries, win-
ning twice as many FDI projects from
Chinese businesses.
The UK is overly dependent on a
small number of countries, especially
the US. Much foreign investment is for
financial services. The UK’s mature
retail financial sector does not look
attractive because of opportunities in
less mature or emerging markets and
increasingly thin margins.
Wholesale banking, capital markets
and asset management in the UK do
remain attractive, given we have
among the strongest bases in the
world. The government and regulators
must ensure that concerns over retail
banking security, largely a feature of
western economies, do not inhibit the
wider role of financial services in
financing and facilitating the ongoing
development of global trade.
The mood of investors has also
changed. Domestic demand is the sin-
gle most important factor driving
investor decisions to locate in the UK.
The other consistent theme is the call
for more support for research and
development, and education and
skills development. There is also a
need to improve investment appeal
through incentives, taxation and
attention to real estate and labour
costs.
The traditional appeal of the UK also
looks slightly shakier. Looking to
Germany, investors value its transport
and logistics skills and infrastructure,
and telecommunications infrastruc-
ture. The UK tends to attract investors
on softer criteria, like quality of life
and political stability. Though these
remain crucial, more analysis is
required to understand if further
investment is required in physical
facilities to reposition the UK.
There are bright spots. London
attracts more investment from abroad
than any other European city (and any
country, apart from France, Germany
and Russia). This is based on the capi-
tal’s supreme position in business
services, software and financial servic-
es. India is the biggest investor to the
UK among the Brics, and we receive by
far the majority of their investment to
Europe. The automotive sector is the
real success story, with inward invest-
ment being used to harness the poten-
tial to relaunch an industry the UK
was once famous for.
The government is also clearly com-
mitted to securing investment. I have
travelled with the Prime Minister and
business leaders on several occasions
to promote the opportunities avail-
able in the UK. UK Trade and Industry
is also a tireless advocate for our indus-
tries. However, Lord Green, minister
for trade and investment, recognises
there is no room for complacency, and
there is always more to do to enhance
our offer to overseas enterprises.
The UK has unrivalled attributes,
and must maintain these while find-
ing new ones. This summer – and
beyond – the government and busi-
ness must use its moment in the sun
to capitalise on the UK’s strengths and
brand.
Steve Varley is managing partner at Ernst
& Young, UK and Ireland. The 2012 UK
Attractiveness Survey is out today at
www.ey.com/attractiveness
failure. Similarly, reciprocal back-
scratching, upward ratcheting of
pay, and the capture by executives of
remuneration consultancies, are not
necessary features of market
operations. They can be corrected by
free market mechanisms. It is the
shareholders’ responsibility to insist
that rewards fairly reflect the
corporate objective.
The High Pay Commission, an
inquiry set up to look at executive
remuneration, concluded that high
pay is corrosive and unfair. But the
purpose of corporations is not to
promote an egalitarian society.
Corporations aren’t creatures of the
state, there to serve official social
ends. They are the private property
of their shareholders, and serve the
ends designated by their owners.
Corporate governance refers to
ways of ensuring that corporate
actions, agents and assets are
directed at the constitutional
objectives of the corporation, set by
the shareholders. It should be up to
the shareholders to determine the
rights, responsibilities and
remuneration of all their corporate
agents, and to specify the kinds of
accountability they require. Given
the varied history, size, activity,
jurisdiction and shareholder
composition of corporations, one
size will emphatically not fit all.
Regulation is counterproductive.
It is inflexible and imposes
substantial costs, both in funds and
freedoms: even disclosure is not
costless. The High Pay Commission
programme would increase
intervention, impede corporate
governance, and damage business.
In demanding detailed disclosure,
greater diversity, inexperienced
directors, claw-back provisions, and
binding votes, the High Pay
Commission’s suggestions would
further constrain shareholders from
governing their corporations in
their own ways.
The government needs to reduce
obstacles to free markets and
genuine owner control. Free
markets elicit innovative solutions
to problems as they arise, in all their
real-life variety; they effectively test
those solutions and disseminate best
practice. In a genuine market for
corporate control, companies would
compete for shareholders, and
investment managers would
compete for funds, partly on the
degree and kinds of accountability
they offered to owners and investors.
The best way to ensure good
corporate governance would be to
maximise shareholders’ freedom to
govern their own corporations in
their own ways.
Dr Elaine Sternberg is author of Mind
Your Business, published today by the
Adam Smith Institute.
AGAINST
THE GRAIN
ELAINE STERNBERG
Government must stop meddling and leave pay decisions to shareholders
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23
Marital business
[Re: Selling off unproductive assets is
liberating music to a capitalist’s ears,
yesterday]
Anthony Evans says he has merged his CD
collection with his wife’s, and she has made
unofficial assurances that the new entity
now belongs to him. I’m afraid his wife now
sees the entire collection as a problem. After
a brief honeymoon period, she will urge
Evans into an ongoing restructuring
programme that may include the sale of key
assets (limited editions that “don’t fit on the
shelf”). He will ultimately be asked to
identify 100 titles that will need to satisfy
key covenants. These will, six months later,
share the fate of the rest of his collection.
Don’t say I didn’t warn him.
IlkleyMoore
Diversity in the City
[Re: Will the City ever be representative of
London’s broader workforce?, Monday]
Elaborating on David Lammy’s point on the
distinction between the City’s desk workers
and its desk cleaners, visiting the City
during the day is starkly different to visiting
at night. But if the things are really going to
change, the Cabinet must take a lead. Is this
government really representative of
Britain as it is today?
YinkaOyesanya
[Re: Why Germany could eventually lose
patience with the euro, yesterday]
For all this talk of countries leaving the euro,
there are a good number considering joining
– Latvia for one. Will anyone warn them?
JohnMatthews
V
ICTORY for the centre-right
New Democracy party in
Greece’s election has been
widely hailed as a victory for
pro-bailout and pro-austerity
forces. However, the fine print tells a
different story.
Even though a broadly pro-bailout
government is now likely, a renegoti-
ation of the bailout terms is almost
inevitable given austerity fatigue.
Only 42 per cent of the electorate
voted for the two pro-austerity par-
ties – New Democracy and the cen-
tre-left Panhellenic Socialist
Movement (Pasok). Hardly an
endorsement of continued fiscal
pain. And recent opinion polls indi-
cate that around two thirds of voters
are against the memorandum docu-
ments made between the govern-
ment and the EU/IMF troika. Any
new government lacks the democrat-
ic legitimacy to impose further fiscal
pain at the same pace. If it does, it
risks an escalation of social unrest,
potentially leading to another desta-
bilising election and a likely victory
for left-wing, anti-austerity forces.
The Greek economy has entered
the fifth year of economic depres-
sion and contracted by 6.5 per cent
year-on-year in the first quarter of the
year. From its pre-crisis peak in the
third quarter of 2008, until its latest
trough recorded in the first quarter
of 2012, the Greek economy contract-
ed by almost 16 per cent in real, sea-
sonally adjusted terms.
Unemployment in March came in at
22.7 per cent, up from 16.2 per cent a
year earlier. More than half of all
young people are unemployed.
The pursuit of internal devaluation
through fiscal cuts and structural
reform has helped to bring the budg-
et deficit down to 9.2 per cent of GDP
last year, from 15.6 per cent in 2009.
However, further progress on deficit
reduction is hampered by the weak-
TOP TWEETS
The Germans are way too emotionally invest-
ed in the euro to ever consider leaving.
@TowusuAdjei_PwC
Inflation is down to 2.8 per cent because of
lower fuel prices. If Cameron really cares
about the economy, reduce fuel duty now.
@yogs1961
Burma’s reform process is the autocrat’s ver-
sion of a dot.com IPO: a way for elites to cash
out their stakes and ensure comfy retirement.
@jay_ulfelder
It took two years from the launch of the iPad
to Microsoft to announce Surface. During that
time Apple shipped iPad 1, 2 and 3.
@mikko
Is Microsoft likely to find success with the
launch of the Surface Windows 8 tablet?
YES
Can Microsoft’s new tablet beat the iPad? No. Apple’s category-
defining product had a US tablet market share of around 73 per cent
last year and it shows no sign of slowing. But Microsoft’s offering
can still be a success – the market for tablets is growing
exponentially (by 91.7 per cent this year and 62.2 per cent in 2013,
according to Morgan Stanley) – and the remaining 27 per cent is
well worth playing for. And here the real question is: can Microsoft
beat Google’s Android, the only other serious competitor. The
answer is yes. Despite being in the market for 18 months, Android
has failed to convince users it is a viable competitor to the iPad.
Microsoft, on the other hand, has built its new Windows 8 operating
system around “touch” – and it looks good. Apple won’t be unduly
worried but Google should be.
Steve Dinneen is deputy lifestyle editor at City A.M. and writes a
weekly Geek Speak column.
Steve Dinneen
NO
Craig Cartier
Despite the innovations expected in the recently announced Surface,
Microsoft faces an uphill battle in establishing itself in the tablet
space – particularly considering Apple’s dominant 60 per cent share
of the tablet market. The Arm version of the Surface will require
developers to rewrite applications for the Windows RT operating
system. Thus, from an applications perspective, Microsoft faces not
only the challenge of making up ground on Apple, but also of
convincing hesitant developers that the Microsoft tablet ecosystem
will be strong enough to invest the time and effort to develop
applications. Additionally, the iPad is simply cool, and it is this cool
image that has inspired legions of Apple faithful to camp out at
stores worldwide, awaiting its latest release. At least initially, it’s
hard to imagine Microsoft inspiring a reaction at a similar scale with
the Surface.
Craig Cartier is an ICT analyst at Frost & Sullivan.
RAPIDresponses
Just 42 per cent
of Greek people
are for austerity
ening economy, which is trapped in a
vicious cycle of budget cuts and eco-
nomic contraction.
As such, a renegotiation of the
bailout terms is almost inevitable.
Such a renegotiation may not go as
far as many Greeks hope, in revers-
ing spending cuts and reducing
taxes, but could involve an extension
of the deadlines for the country’s fis-
cal adjustment. Under current plans,
the incoming government has to
identify further fiscal consolidation
measures equivalent to 7 per cent of
GDP, around €14.3bn (£11.5bn) – 1.5
percentage points in revenue increas-
es and 5.5 percentage points in
spending reductions – to fill a gap
looming in targets for 2013-14.
Pasok and New Democracy want
the targets to be extended from 2014
to 2016, or 2017, reducing the cuts
necessary in 2013 to €2bn-3bn from
around €7bn. This may allow the par-
ties to sell this as a political victory. If
coupled with a commitment to con-
tinue to pursue fiscal austerity,
Greece’s international lenders may
agree. This would buy more time,
but nothing more.
The path of internal devaluation
looks too long and painful in the
medium term; competitiveness may
only be restored by a Greek euro exit,
but in the short term the costs for
both Greece and the Eurozone would
be incredibly high. But not doing so,
is just delaying the inevitable.
Martin Koehring is an economist for the
Europe team at the Economist Intelligence
Unit.
WEDNESDAY 20 JUNE 2012
MARTIN KOEHRING
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The Forum is open for you to take part. Got a sharp comment on
one of today’s columns? Do you have another subject you want
to share your opinion on? We want to hear your views.
Email theforum@cityam.com or comment at cityam.com/forum
WEDNESDAY 20 JUNE 2012
24
cityam.com
FOREIGN EXCHANGE
T
HE Eurozone is in crisis and it
is impossible to argue
otherwise. For years, the
governments of member states
spent more than they were able to
collect from their citizens in taxes.
So they went to the debt markets to
make up the shortfall. The markets
took the view that the stronger
Eurozone nations would always
come running to the rescue and
underwrite the sovereign debts of
their common currency brothers in
arms – allowing them to borrow at
artificially low rates. But when
creditors saw through this,
European bond yields rocketed and
severed their close correlation with
the German bunds. This is not
breaking news and it will continue
to run. However, the constant
Eurogeddon headlines have created
a number of misunderstandings
about the nature of currency
markets.
BONDS, EQUITIES AND CASH
The Eurozone has monetary union
without fiscal union and political
union. And yes, the euro is linked to
the European integration that made
the creation of the Eurozone possi-
ble. But one of the biggest fallacies is
that this is somehow a currency valu-
ation crisis. It simply is not and to fall
into this trap can be a costly mistake
for traders and investors. How many
times have you watched rolling news
headlines of one ineffective political
summit after another, revolting
Greeks and ever widening Club Med
sovereign bond yields, but yet the
euro has seen gains over the day? If
you were trading simply on the views
of political commentators, your bot-
tom line would have been torn to
shreds in days. If you trade what you
see, rather than what you want to
see, you will have much more chance
of staying in the black.
You can argue that the adoption of
a common currency across a collec-
tion of disparate economies, with no
means for those member states to
exert sovereignty over their currency,
has contributed to the predicament
in which we find ourselves. You can
argue that Greece’s situation would
not be quite so severe if it held a cur-
The euro may rise
despite the crisis
rency that was quasi-independent of
its northern European neighbours.
And you can argue that being part of
the Eurozone caused mis-pricing of
credit risk for European sovereign
debt. Whether or not you agree with
these arguments, they are all linked
to the use of the euro by the
Eurozone economies. But they are
not linked to the euro as a currency
and certainly not to its value. The
Eurozone crisis has made investors
less willing to hold certain European
sovereign debts. But it has not under-
mined the euro’s ability to serve as a
medium of exchange and a store of
value. The 12-month cumulated sea-
sonally adjusted current account of
the Eurozone recorded a surplus of
€9.6bn in March 2012 (around 0.1 per
cent of Eurozone GDP), compared
with a deficit of €16.7bn the same
time last year (around 0.2 per cent of
Eurozone GDP). This shift resulted
from increases in the surpluses for
goods (from €2.5bn to €15.4bn), servic-
es (from €51.1bn to €62.5bn), and
income (from €31.5bn to €32.4bn),
and a decrease in the deficit for cur-
rent transfers (from €101.7bn to
€100.6bn).
Another mistake is to conflate
volatility in the European equity and
debt markets with volatility in the
euro against its pairs. Against the dol-
lar, the euro’s annualised standard
deviation of percentage change in
daily price is 9.06 per cent. While this
isn’t as flat as some pairs, it is par for
the course among the majors. By way
of comparison, Hungary, a country
within the EU, but not the Eurozone,
has a dollar-Hungarian forint volatili-
ty of 17.69 per cent.
CRISIS CURRENCIES
If you want to see the price action of a
currency in crisis, recent history is
not short of them. Mexico in 1994,
the 1997 Asian financial crisis, Russia
in 1998 and Argentina’s woes from
1999 onwards. The faith in their cur-
rencies as a store of wealth simply dis-
integrated. Their bond crises are
useful examples of the legal twists
and turns of trying to settle sovereign
debts in different legal jurisdictions
(lex monnetae) – an issue that
Greece’s creditors may have to face.
But as comparisons with the current
European situation they fall short.
The euro is stable, strong and in
demand. And there is no reason why
it should not remain so. Greece may
leave the Eurozone and Spain may
need another liquidity injection to
keep its banks solvent. But as long as
there is a core, solvent grouping of
European economies trading in the
euro, it can remain a strong currency.
Even if that group is just Germany by
itself.
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WEALTHMANAGEMENT
Bonds and banks may be in crisis, but the common currency is much more calm
Dollar-yen in the Asian crisis
1 Jun1997 31 Dec1997
111
115
120
125
130 ¥
B
ELIEVE it or not, this is the
fourth generation Lexus GS
model, a car that has been in
production since 1993, quietly
going about the business of offering
buyers a unique alternative to the
more familiar premium saloons like
the Audi A6, BMW 5 Series and
Jaguar XF.
Unique? Really? Well Lexus does
things a little differently. Whereas
competitors have relied on improving
the efficiency of their petrol and
diesel engines, Lexus has stuck with
its petrol/electric hybrid technology.
It’s something that other manufac-
turers are catching on to now that big
hybrids are increasingly in vogue,
thanks to high fuel prices and tax
advantages for hybrid cars – Audi,
BMW and Mercedes-Benz are all
bringing hybrid versions to market.
And the GS450h is impressive. It has
the best horsepower to CO2 ratio of
any car on sale. In combination, its
3.5-litre petrol V6 engine and electric
motor produce a massive 341bhp. It
can accelerate from 0-62mph in just
5.9 seconds, all the while emitting
just 141g/km of CO2 and returning
46.3mpg (combined). In practice, this
means you get big car performance
with low economy and emissions:
you can have your cake and eat it too.
As far as Lexus is concerned, its GS
is a grand touring sedan, which is
one reason why we drive the car from
Munich and into Austria and on to
the South Tyrolean mountain roads.
In this generation of GS, Lexus has
produced a more youthful, engaging
and convincing alternative to the
diesel-powered saloons of its premi-
um competitors. Remember this is a
car that you can drive on electric
power only – albeit over a limited dis-
tance and to a maximum speed of
25mph – yet on the unrestricted auto-
bahns of southern Germany the
GS450h had impeccable manners at
speeds above 240km/h. That’s
150mph in real money and even at
such a speed the driving was effort-
less and the GS was stable, quiet and
the ride extremely comfortable. As a
motorway cruiser it proved an excel-
lent companion.
More surprisingly, in top spec F
Sport guise, Lexus’s hybrid saloon
was also capable in the corners. I
drove both the GS450h and the
GS450h F Sport with its additional
Lexus Dynamic Handling system.
Here Lexus has used technology to
improve the handling of this car,
which was always going to be fairly
heavy. Though the body is stiffer, the
GS450h still weighs in at 1,800kgs, so
the dynamic handling system works
to improve the car’s agility. It cleverly
monitors speed, steering direction
and driver input, then calculates the
best angle for its four wheels to be at
to improve turn-in and rear grip. The
result is a more dynamic driving expe-
rience.
The latest generation GS has an
entirely new exterior and interior.
From the outside the car looks
younger and more aggressive. The
new face takes cues from the CT200h
compact and LFA supercar and has an
unusual spindle-shaped grille
between striking daytime running
lights and a three-light headlamp
design. The car has flared wheel arch-
es – the new GS has a wider running
track – and in F Sport guise has bigger
19-inch wheels and a rear spoiler.
But it is the inside where the new GS
design is the most impressive. The
interior is simply excellent.
Dominated by the largest LCD screen
in production – the 12.3in display is
perhaps the most flamboyant feature
of the interior – all of its menus are
accessed via a joystick on the centre
console. The cabin is swathed in
leather aluminium and chrome and
the layout is driver-focused so all of
the controls are easy to reach. The GS
is packed with technology – blue-
tooth, a head-up display, lane depar-
ture warning, adaptive cruise control,
the list goes on. The car can be driven
in “Eco”, “Sport” and “Sport Plus” –
the instrument display switches its
readout depending on the mode –
and you can manually control the
CVT transmission using paddle
shifters. Amazingly, the air-condition-
ing system makes use of nano technol-
ogy to release particles which purify
and deodorise the air and even mois-
turise your skin, apparently.
So if you thought green was dull,
you’d better think again. Lexus has
built a cleaner, greener, more power-
ful, autobahn-eater of a hybrid saloon.
It’s automotive alchemy. Skincare
included.
The car drives well and has good stats, but the interior is a real, unadulterated treat.
Lexus makes automotive alchemy
The hybrid GS450h has the best horsepower to CO2 ratio of any car on sale...and it looks fabulous too
25
WEDNESDAY 20 JUNE 2012
LIFE&STYLE
cityam.com
MOTORING
CAR TALK
BY RYAN BORROFF
Porsche’s special Club Coupes
Porsche is building 13 special 911 Club Coupes to celebrate the 60th
anniversary of the first Porsche enthusiast clubs. Based on a 911 Carrera
S, each car has a 30bhp improvement on the standard car – up to
424bhp – meaning 0-62mph is possible in four seconds flat. Painted in
“Brewster Green”, each car gets an aluminium sill engraved
with the buyers name.
WORDS BY
RYAN BORROFF
THE VERDICT:
DESIGN hhhii
PERFORMANCE hhhhi
PRACTICALITY hhhhi
VALUE FOR MONEY hhhii
THE FACTS:
LEXUS GS450h F SPORT
PRICE: £50,995
0-62MPH: 5.9 secs
TOP SPEED: 155mph
CO2 G/KM: 141g/km
MPG COMBINED: 45.6mpg
Land Rover’s extra special ranges
If you are a Land Rover Defender fan but you crave the indulgence of its
Range Rover siblings, tuners Twisted Performance rebuilds Defenders into
something more individual and luxurious. Each of its Alpine, French and
Retro ranges rework the spartan and functional off road icon into something
much more special. Options include increased engine performance with
brake and suspension upgrades and unique interior leather trim.
Alfa’s 4C sportscar wins concept car award
The Alfa Romeo 4C sportscar has won the prestigious concept car award
at the recent Villa d'Este Concours d'Elegance. The two-seater rear-
wheel drive coupé beat beautiful rivals including Stile Bertone’s Jaguar
B99, the Lexus LF-LC and even Aston Martin's Project AM310 concept –
the new DBS in concept form – in the public poll. The 4C is expected to
go on sale next year.
26
TV & GAMES
cityam.com
T
E
R
R
E
S
T
R
I
A
L
BBC1
SKY SPORTS 1
5.30pmLive T20 Cricket 9pmLive
Prizefighter Boxing 12amT20
Cricket 2amPrizefighter Boxing
5amTotal Rugby 5.30am-6am
Futbol Mundial
SKY SPORTS 2
7pmLive Winning Post 9pmTotal
Rugby 9.30pmFIBA Basketball
10pmFootball’s Greatest 10.30pm
Euro 2012 Report 11pmAsian Tour
Golf Show11.30pmFIFA Futbol
Mundial 12amWatersports World
1amInside the PGA Tour 1.30am
European Tour Weekly 2amAsian
Tour Golf Show2.30amPGA
EuroPro Tour Golf 4.30amAsian
Tour Golf Show5am-6amBoots ’n’
All
SKY SPORTS 3
7pmEuropean Tour Weekly 7.30pm
Inside the PGA Tour 8pmPGA
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Fill the grid so that each
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Place the numbers from 1 to 9 in each empty cell so that
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Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
KAKURO
QUICK CROSSWORD
LAST ISSUE’S
SOLUTIONS
KAKURO
WORDWHEEL
SUDOKU
SUDOKU
QUICK CROSSWORD
WORDWHEEL
1 2 3 4 5 6
7 8
9 10 11
12 13 14 15
16 17 18
19 20
29 30
45
29
8 6 7
39 11
3 12
5 23
23 4 17
42
45
13 10
12
14
13
10
15
17
18
7
14
40
24
11
12
22
32
28
16
13
16
34
8
11
9
5
ACROSS
1 Air cavity in
the skull (5)
4 Military trainee (5)
7 Carry out in
practice (7)
8 Expert (3)
9 End in a particular
way (5)
11 Lie in ambush (5)
12 Frighten away (5)
14 Common
crustaceans (5)
16 Allow (3)
17 Climb awkwardly (7)
19 Sloping mass of
loose rocks at the
base of a clif (5)
20 Cardinal number (5)
DOWN
1 Ordered series (5)
2 Mesh (3)
3 Person held in
servitude (5)
4 Board game (5)
5 Bram Stoker’s
vampire (7)
6 Adjust finely (5)
10 Electric motor
for bringing an
engine to life (7)
12 Cut-price events (5)
13 Compere (coll) (5)
14 Go after with the
intent to catch (5)
15 Lofty proud gait (5)
18 Appropriate,
seize (3)
M
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P
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4


S A L T T A R I F F
U A T O M O
B A R S P O L I C E
T K U U
L O W S P I R I T S
E E F A F
R E A S S E M B L E
A W O I
M I L D E W O D D S
T D A I S T
C A L V E S E A S Y
1 2 6 4 8 9 2
3 6 8 9 7 8 3 9
5 9 4 1 1 6
5 1 3 7 4 8
8 3 1 4 9 5 7 6 2
9 8 5 6 3 6 2 1
7 4 2 5 1 6 9 8 3
3 7 5 9 9 8
5 3 1 2 9 7
7 5 9 8 9 8 5 3
1 4 2 2 4 3 1
4
4
4
4
4
4
4
4
4
The nine-letter word was
STRAPLINE
T
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BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5
WEDNESDAY 20 JUNE 2012
SILK
BBC1, 9PM
Martha’s loyalty is tested as she
defends Jody Farr, the man
responsible for the death of her former
client Brendan Kay.
THE SECRET HISTORY OF OUR
STREETS BBC2, 9PM
The social history of the Caledonian
Road in Islington, which for a mile-
and-a-half provides a major route
heading north from King’s Cross.
THE KILLING
CHANNEL4, 10.30PM
Sarah tries to organise a search for
Holder but is blocked by Lt Carlson,
while Richmond continues to be
hounded by the press.
TVPICK
T
HE Prince of Wales’s Stakes
(3.45pm) is often one of the
most thrilling spectacles
during Royal Ascot, none
more so than last year when
Frankie Dettori produced the ill-
fated Rewilding to collar So You
Think in the final strides. That
defeat was a big blow to
Ballydoyle who had marked
down the son of High Chaparral
as one of their bankers of
the meeting.
So You Think went on to win
the Coral-Eclipse and Irish
Champion Stakes, but again
found one too good in the QIPCO
Champion Stakes back at this
venue in October. Cirrus Des
Aigles outpointed him that day
and it’s a great shame that
Corine Barande-Barbe pulled her
stable star out of this race earlier
in the week, as I think he would
have won.
Aidan O’Brien ended his
Emirates amnesty back in
March, but So You Think could
only finish fourth in the Dubai
World Cup. However, he
bounced back to take the
Tattersalls Gold Cup at the
Curragh for the second year run-
ning and he is 10/11 with Star
Sports to win this afternoon.
The former Australian-trained
horse is undoubtedly the most
likely winner in the field, but I
wouldn’t want to be taking odds-
on about him – he was turned
over at 4/11 in this race 12
months ago. He is also now a six-
year-old and only one horse older
than five has won this race
since 1979.
So, who can beat him? The
obvious place to start is the
Queen’s Carlton House, who
looked back to his best in the
Brigadier Gerard at Sandown last
month. He was a hugely impres-
sive winner of the Dante last sea-
son, but just didn’t look suited to
1m4f in the Investec Derby.
I have no doubt that this is his
best trip, but he’s short enough at
3/1 with Coral and I can see that
price getting even shorter as
everyone will want to be on a
Royal winner. I’m still not entirely
convinced by the form of Sir
Michael Stoute’s stable and the
yard actually has a pretty poor
record in this race, winning it just
the once with Stagecraft in 1991.
Marco Botti received a big
boost when PLANTEUR was sent
to him earlier this year and the
former Ellie Lellouche-trained
son of Danehill Dancer looks a
knocking each-way bet at 9/1
with Star Sports. He finished half
a length in front of So You Think
in the Dubai World Cup, and
actually ran well in the Prix
D’Ispahan at Longchamp last
time, where he was unsuited by
the steady pace.
He came home a slightly dis-
appointing fourth in this race
last year, but it doesn’t look a
particularly strong contest and
I’d be surprised if he wasn’t in
the first three this time.
Another one who interests me
is Godolphin’s FARHH, who anni-
hilated his rivals in the Thirsk
Gold Cup last month. Not many
horses would have come into this
Group One contest having previ-
ously contested a handicap at the
North Yorkshire track, but the
manner in which he put the race
to bed was stunning and he is
unbeaten in three career starts.
This is obviously a huge step
up, but he has clearly always
been well regarded by Saeed Bin
Suroor, and if he handles the
extra two furlongs he could go
very close. Frankie Dettori takes
the ride and there isn’t a better
jockey around this course, so
Farhh is also worth backing
each-way at 10/1 with Coral.
The second day kicks off with
the Group Three Jersey Stakes
(2.30pm) and an astonishing 26
runners line-up. There were only
nine contenders when Strong
Suit won last year, but this year’s
field can be narrowed with plen-
ty looking out of their depth.
Fillies have a decent record in
this contest and William Haggas
saddles the likely favourite,
Sentaril. She has won both her
career starts in impressive fash-
ion and should go close.
However, she might struggle to
beat Roger Varian’s ALJAMAA-
HEER, who easily won a Listed
race at Newmarket last time.
That form was boosted yesterday
when The Nile was behind him
that day and he was running a
big race in yesterday’s St James’s
Palace before tragically breaking
his leg. The 11/2 available with
Coral is worth taking.
You can never rule out Aidan
O’Brien at this meeting, so Reply
has to be respected, while Jeremy
Noseda’s Valbchek also looks pro-
gressive. But I’m going to take
Aljamaaheer to give Varian his
first Royal Ascot winner.
The Windsor Forest Stakes
(3.05pm) looks a straight
shootout between the front
three in the betting and I fancy
Dermot Weld’s EMULOUS to
come out on top. She, along with
Nahrain, has to carry a Group
One penalty, but she has won her
last four and I just can’t get out
of my mind the way she
beat Together in the Matron
Stakes at Leopardstown
last September.
Nahrain is respected following
her win in the Prix De L’Opera,
but I’m not entirely convinced
she will have the speed to cope
with Emulous. Sir Henry Cecil’s
Chachamaidee was second in
this race last year, and I think
she’ll definitely get placed again,
but this looks a hotter race and
seven furlongs might just suit
her better.
Dermot Weld doesn’t normal-
ly send many over to this meet-
ing, so that’s a hint in itself and
Emulous is a solid bet at 11/4.
You can follow me on Twitter
@BillEsdaile for all my views
from the track.
Planteur and Farhh are the
value calls in Prince of
Wales’s Stakes
27
THEPUNTER
RACING TRADER
BILL ESDAILE PREVIEWS TODAY’S OPENING THREE RACES AT ROYAL ASCOT
cityam.com
WEDNESDAY 20 JUNE 2012
n Pointers…
ALJAMAAHEER e/w 2.30pm Royal Ascot
EMULOUS 2.30pm Royal Ascot
PLANTEUR e/w 2.30pm Royal Ascot
FARHH e/w 2.30pm Royal Ascot
£20 FREE BET!
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IF YOUR HORSE FINISHES 2ND TO
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THE ODDS
1-2-3 1/3
JERSEY STAKES
PLUS
IFP8C8J:FKN<;E<J;8PÇC@M<FE99:)
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(Claºº I) Im 2l 4yo pluº Winne| £2B?,550
( II?-?2 9@>9CL<B@KK<E (5º)(T) 4-º-0 ...............................................................AGDlikX^_
(I0) Runs. º Wins. 5(A,0) Places. 4 £I22,8?o
Trainer. C Brown (USA) 0wner. Kennelh L & Sarah K Ramsey
) /I?4-I :8ICKFE?FLJ< (20)(02) 4-º-0 ....................................................................ICDffi\
(2) Runs. o Wins. ?(F,0S,0) Places. 2 £28º,0º2
Trainer. Sir MSloule 0wner. The 0ueen
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(II) Runs. Iº Wins. 7(A,0) Places. 5 £58º,8??
Trainer. MAl Zarooni 0wner. 0odolphin
+ 42I-I5 :FCFD9@8E (20)(0?) 4-º-0 .................................................................................N9l`Zb
(4) Runs. II Wins. ?(F,S) Places. 4 £o8,0I8
Trainer. J 0osden 0wner. R R R Princess Raya oI Jordan
, I/I-I =8I?? (4o) 4-º-0 ........................................................................................................C;\kkfi`
(8) Runs. ? Wins. ?(F,0S,0) £25,725
Trainer. S Bin Suroor 0wner. 0odolphin
- 458-*? GC8EK<LI (24)(0?) 5-º-0 .............................................................................. :Jfld`ccfe
(I) Runs. Io Wins. 5(S,0S,0) Places. o £I,2?2,27º
Trainer. MBolli 0wner. Mr Mohamed Albousi AlghaIli
. ?I0-?7 I<C@89C<D8E (24)(T,0?) 4-º-0 ...................................................................... >Dfjj\
(º) Runs. 8 Wins. 4(S,0) £42,8Io
Trainer. A de Royer-0upre (FR) 0wner. Pride Racing Club
/ I4?4?o IF9@E?FF; (I8)(V,0) 4-º-0 ....................................................................A8?\]]\ieXe
(5) Runs. I2 Wins. 2(0) Places. 2 £o0,I07
Trainer. A P 0'Brien (!RE) 0wner. Mrs John Magnier, Mr MTabor & Mr 0 Smilh
0 42--+I JFPFLK?@EB (24)(0º) o-º-0 .......................................................................AGFË9i`\e
(7) Runs. 2I Wins. I2(S,F,0S,0) Places. 5 £2,057,I27
Trainer. A P 0'Brien (!RE) 0wner. Smilh/Magnier/Tabor/0aloTan/TunkuYahaya
(' 5º7-(o JI@GLKI8 (?8)(C,0) o-º-0 ....................................................................................E:XccXe
(?) Runs. 25 Wins. o(F,A,0) Places. ? £405,2º2
Trainer. R Varian 0wner. R R R Sullan Ahmad Shah
(( º-o44? N@>DFI<?8CC (4I)(0?) 5-º-0 ................................................................. AGJg\eZ\i
(o) Runs. 2? Wins. o(F,0) Places. o £I,2?8,º72
Trainer. MBell 0wner. Mr MB Rawlin
20II. Rewilding 4 º 0, L 0ellori I7-2 (M Al Zarooni), drawn (o), 7 ran.
BETT!N0 F0RECAST. I0-II So You Think, ? Carllon Rouse, 8 Planleur, I0 Farhh, I2 Reliable Man, 20
Wigmore Rall, Colombian, 25 Cily Slyle, 50 0lhers.
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Planteur holds strong each-way claims in the Prince of Wales’s Stakes
T
ODAY’S big betting race is
the Royal Hunt Cup
(4.25pm) and a maximum
field of 30 means the draw
often plays a big part. However,
there didn’t look to be any real
bias yesterday and hopefully the
straight course will continue to
ride fairly over the next few days.
James Fanshawe pulled
Primaeval out of this race
earlier in the week and relies
on Dimension, who will
probably go off favourite. The
four-year-old won a decent
handicap at this course in
September and he didn’t run
badly on his reappearance at
Lingfield. He is definitely one of
the leading lights and it
wouldn’t be a surprise to
see him go close under
Johnny Murtagh.
The big gamble of the race is
Edinburgh Knight who has been
backed down from 33/1 to a best-
priced 12/1 with Coral. He is a
big danger and proved his liking
for this track when winning the
closing handicap on QIPCO
Champions Day. That said, he
has to carry 9st 8lb and no horse
has successfully carried such a
burden in the past 30 years.
David Simcock’s yard are
hitting form at exactly the right
time and I’m pretty sweet on the
chances of MABAIT at 25/1 with
Paddy Power. The former Luca
Cumani-trained inmate was
rated as high as 114 in his pomp,
yet races off just 96 today. He
was second to Dandy Boy in the
2010 Victoria Cup off 104, so this
8lb lower mark should mean
he’s ready to go close.
Mabait only moved to
Simcock’s stable in December
and, although he ran
disappointingly in Meydan
during the winter, his third at
Chester last time over seven
furlongs was a marked
improvement. He was unlucky
in running that day and the
return to a straight track over a
mile should eke out some more
improvement. His draw in stall
30 against the stands rail could
be good and he has a much
better chance than his odds of
25/1 suggest.
It’s always worth having a
couple of arrows to fire in these
big handicaps and my other
selection is CAPTAIN BERTIE
for Charlie Hills. He ran a
disappointing race in last year’s
Britannia Stakes at this meeting
for Charlie’s father, Barry, but
he has looked a completely
different animal this term
thanks to a gelding operation.
You would struggle to find an
unluckier loser than this fellow
on his seasonal debut at
Doncaster when he got
absolutely no run at all and
finished like a train. All was not
lost, though, as he got a much
better passage on his next start
at Newbury to land the Spring
Cup. That form was franked
when runner-up, Fury, came out
and won a Listed race at York,
while the third, Global Village,
took the Victoria Cup here three
weeks later.
Captain Bertie has shown that
he handles all types of ground
and with four-year-olds winning
the last five renewals of this
race, he is worth backing at 11/1
with Star Sports. There are
plenty of others with solid
claims, including Belgian Bill,
Prince of Johanne and
Bridgefield, but Mabait and
Captain Bertie should give us a
good run for our money.
IRISH trainers have tasted
plenty of success at Royal Ascot
in recent years, particularly
Aidan O’Brien, but David
Wachman has a solid record
too and DUNTLE can give him
another winner in today’s
finale, the Sandringham Stakes
at 5.35pm. She broke her
maiden tag at Dundalk in
April, beating her rivals by an
incredible 18 lengths, and form
on the all-weather often counts
for plenty at
Ascot.
The daughter of Danehill
Dancer then stepped up in
class for the Irish 1,000
Guineas Trial, but Wayne Lee
took up the running too early
in the straight and eventually
finished fourth. That wasn’t a
bad effort at all and the drop
back to Listed level this
afternoon should see her go
very close indeed. At 7/1 with
Star Sports, she represents
solid each-way value.
Electrelane is the class horse
in the race and her presence
means eight of the 18 runners
start from out of the handicap.
She won the German 1,000
Guineas on her last start and
prior to that she finished
second to the progressive
Laugh At Loud at York. The
ground is likely to be much
quicker by the end of today
and that isn’t certain to suit
Ralph Beckett’s filly whose
best form has been with
plenty of cut.
Godolphin have some decent
fillies and I’d favour Pimpernel
over Falls Of Lora. She was
disappointing in the Nell
Gwyn, but she had some solid
form as a juvenile and is
rated the main danger to
the selection.
The Queen Mary Stakes
(5.00pm) features some of the
fastest fillies in Europe and
with 27 runners it’s going to
be another cavalry charge.
Michael Owen was in floods of
tears when Brown Panther won
at this meeting last year and
he could be reaching for his
hanky again if Manor House’s
UPWARD SPIRAL can follow
up her debut win at Sandown.
I was very taken by that
performance and so were
Qatar Racing Limited who paid
a tidy sum for her. She beat
Jubilee Diamond from the
Richard Hannon stable and
that rival reopposes today, but
I would be very surprised if she
can reverse the form. Johnny
Murtagh is an interesting
jockey booking and the 6/1
available with Coral should be
snapped up.
Mironica also comes into
this race with one victory from
one start and I’ve already
talked up the chances of her
stablemate Duntle in the
finale. Wachman has done well
in the Queen Mary in the past
so this filly is much respected.
Mick Channon is another
trainer with a strong record
in the race and Graphic Guest
is another who should
go close.
Frankie Dettori has been
booked by James Given to ride
the unbeaten Jadanna and she
has won on both soft and firm,
so the ground shouldn’t
matter too much to her. I can
see her finishing in the first
three, but I’m happy to stick
with Upward Spiral as my sole
selection.
David Simcock’s runner Mabait has tumbled down the weights and has some solid course form, so should benefit from returning to a straight track over a mile
David Wachman’s Duntle has
a big chance in the last
Duntle can bag the Sandringham for Wachman and the Niarchos family
28
THEPUNTER RACING TRADER
n Pointers…
MABAIT e/w 4.25pm Royal Ascot
CAPTAIN BERTIE e/w 4.25pm Royal Ascot
UPWARD SPIRAL e/w 5.00pm Royal Ascot
DUNTLE e/w 5.35pm Royal Ascot
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WEDNESDAY 20 JUNE 2012
BILL ESDAILE PREVIEWS TODAY’S FINAL THREE RACES AT ROYAL ASCOT
Well-handicapped
Mabait has a big
chance in Royal
Hunt Cup at a
massive 25/1
G
E
T
T
Y
PLAYERS paid tribute to late Surrey batsman Tom Maynard, who was killed by a Tube
train on Monday, before England’s series-clinching one-day international win over West
Indies at the Oval yesterday. Captain Alastair Cook’s century swept the hosts to an
eight-wicket victory that leaves them 2-0 ahead with one match remaining. Paceman
Stuart Broad, who took two wickets, dedicated the win to Maynard later on Twitter.
ENGLAND DEDICATE WIN TO TRAGIC MAYNARD
ENGLAND coach Stuart Lancaster
confirmed Harlequins winger Ugo
Monye is unlikely to be available for
Saturday’s third and final Test in
South Africa after being knocked
unconscious in last night’s difficult
win against Northern
Barbarians.
A hat-trick from
Nick Abendanon,
two tries from Jonny
May and further
scores from Ben
Morgan and
Anthony Allen
inspired
England’s
victory as
Charlie
Head injury rules Monye out of
improving England’s final Test
Hodgson’s accuracy with the boot
ensured their efforts did not go to
waste in Potchefstroom.
“Ugo was knocked out during the
tackle,” said Lancaster, whose
attention will turn to England’s final
fixture on Saturday.
“He was taken to hospital but he
has come round and he is fine, albeit
a bit groggy. He will go through the
concussion protocols and he will
struggle to be fit for Saturday.
“We wanted to improve on the
quality of the performance we put in
last week. I thought there was a
better intensity and shape about
what we did.
“I thought the boys adapted to the
conditions better, [and] it was good
for the boys in the stand as well.”
As well as seven conversions
and a penalty from fly-half
Hodgson, England were
awarded a late penalty try.
FRANCE manager Laurent Blanc
lamented his squad’s fitness after
their surprise defeat to Sweden
left them facing a daunting
European Championship quarter-
final with European and world
champions Spain on Saturday.
A spectacular scissor kick from
Zlatan Ibrahimovic followed by
Sebastian Larsson’s stoppage-time
volley were enough for already-
eliminated Sweden to salvage some
pride and weaken France’s hopes
of tournament victory.
“We were not strong enough in
the tackles,” said Blanc. “I think
Sweden played with a lot of heart,
they gave everything, physically
they were much better than us.
“We suffered a great deal at the
back and also in midfield. Sweden
had a lot of physical impact there.
“We were dominated in terms of
tackles, in the air, on the ground,
throughout. Sweden had a lot of
physical presence and we could
not fight that.”
Full-back Nick Abendanon
scored a hat-trick for England
We weren’t strong or fit enough
to beat Sweden, admits Blanc
SPORT
29
WEDNESDAY 20 JUNE 2012
cityam.com
BRITISH gold medal hope Mark
Cavendish insists he would have
skipped the Tour de France if he
thought it would boost his London
2012 road race chances.
The Isle of Man cyclist has already
jeopardised his hopes of retaining
the green jersey in the Tour, which
starts next week, with an Olympics-
oriented training regime.
“If I thought I’d be in better
condition for the Olympics, I would
[miss the Tour]. I am doing both for
different reasons,” said Cavendish.
“It [London 2012] is a big thing. That
is why I am changing [my training].”
Cav: I’d ditch
Tour for gold
BY SPORTS DESK STAFF
SWEDEN.....................................2
FRANCE......................................0
BY DECLAN WARRINGTON
EURO 2012
SA NORTHERN BARBARIANS...31
ENGLAND.................................57
BY DECLAN WARRINGTON
Results
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IN BRIEF
Exiles promotion appeal delayed
nRUGBY UNION: London Welsh’s
appeal hearing over the Rugby
Football Union’s decision to deny
them promotion to the Premiership
has been postponed seven days to
Thursday 28 June.
Mayweather out-earns Woods
n SPORT BUSINESS: Boxer Floyd
Mayweather (£54.3m) has overtaken
golfer Tiger Woods (£37.9m) as the
world’s highest-paid sportsperson,
says Forbes magazine. Woods is third,
after boxer Manny Pacquiao (£39.6m).
Kvitova’s Wimbledon hopes hit
n TENNIS: Wimbledon champion
Petra Kvitova’s title defence
preparations suffered a blow yesterday
when she lost to world No48 Ekaterina
Makarova at Eastbourne.
MATCHWINNER Wayne Rooney
insists rival teams will now fear
England after he capped his
comeback with the goal that
secured top spot in Group D and
set up a Euro 2012 quarter-final
with Italy.
Striker Rooney, returning
from a two-match ban for a red
card in qualifying, headed the
decider in the 48th minute from
a cross by captain and man of
the match Steven Gerrard.
Defeat eliminated co-hosts
Ukraine, who felt aggrieved that
officials did not see Marko
Devic’s potential equaliser had
crossed the line before John
Terry hooked it clear.
In keeping with the rest of
their campaign, England
displayed more grit than guile,
but Rooney believes they have
shown enough in three games
to suggest they can overcome
Italy on Sunday.
“I think we know our
qualities and what we’re
capable of,” he said. “I don’t
think there is any team that
would fancy playing us. We’re
difficult to break down and
we’ve got the players who can
score goals, so it’s going well.”
Manager Roy Hodgson, who
has already exceeded some
expectations by winning the
group ahead of France,
welcomed his team’s slice of
good fortune.
“If it was over the line then
that was a slice of luck,” he said.
“We’ve suffered bad luck in
those areas so if it was good luck
today then we got it.”
England needed only a draw
while Ukraine required a win to
progress, and it showed in the
opening stages as Scott Parker
and Terry had were called upon
to deny Marko Devic and Andriy
Yarmolenko.
Rooney, starting an England
game for the first time since his
red card against Montenegro in
October, should have scored on
28 minutes but headed wide
unchallenged from Ashley
Young’s left-wing in-swinger.
The Manchester United striker
made no mistake just after the
interval, however, nodding in
from virtually on the line after
goalkeeper Andriy Pyatov had
fumbled a menacing right-wing
delivery from Gerrard.
Artem Milevskiy might have
levelled quickly but headed over
from close range, although
Ukraine would soon have the
ball in England’s net, when
Devic escaped John Terry and
shot past Joe Hart.
Terry tried in vain to clear off
the line, with replays showing
the ball had fully crossed,
leaving the co-hosts furious, not
least manager Oleg Blohkin.
RooneysetsupItaly tie
Ascot romp extends Frankel run
OWNER Sir Henry Cecil believes
Frankel is still improving after the
world’s highest-rated racehorse
extended his unbeaten record to 11
races with an explosive victory
yesterday at Royal Ascot.
Frankel, who went off 1-10
favourite in the Queen Anne Stakes,
beat Excelebration by a staggering
11 lengths after jockey Tom Queally
conjured an electric turn of pace in
the last two furlongs of the mile-
long contest.
“He’s a great horse,” said Cecil. “He
did exactly what I thought he would
but he’s still improving.” On plans for
the colt, he added: “He looks like he
can stay a mile and a quarter so we’ll
keep options open.”
Queally said: “It looks like he’s
improving. He settled, he travelled,
he got everything else off the bridle
when I was still sitting there. He’s
amazing. That’s his best
performance. He ticked all the boxes,
he did everything right.”
Elsewhere on the first day of Royal
Ascot, Kieren Fallon rode Most
Improved to success in the St James’s
Palace Stakes, while Hong Kong 12-1
shot Little Bridge won the King’s
Stand Stakes. Undefeated Dawn
Approach earned his fourth career
win in the Coventry Stakes while
Willie Mullins continued National
Hunt trainers’ fine record in the
Ascot Stakes with Simenon.
I
F you have only seen the
result – a win against the co-
hosts, Wayne Rooney
scoring on his return,
finishing top of the group – you
might think England had
enjoyed a perfect night.
But if you did watch the
game you’ll know Ukraine
were very unlucky not to get at
least a draw while England
were poor in possession and
relied on Steven Gerrard, their
best player by a country mile.
It was nothing to get carried
away about, although for now
let’s enjoy this slightly lucky
streak England are on. Roy
Hodgson deserves great credit
for creating such a strong
spirit in the squad and
shielding them from
expectation so well.
A quarter-final against Italy
does not have the same fear
factor as one with Spain and I
give England a good chance of
progressing – but, like last
night, it won’t be pretty.
Trevor Steven is a former
England international who now
works as a talent scout and pundit.
FOOTBALL
COMMENT
TREVOR STEVEN
Striker scores on
return as England
top their group
STARS slammed Uefa last night
after European football’s
governing body fined Croatia
£64,500 for racial abuse just a day
after issuing Denmark’s Nicklas
Bendtner with a £80,000 penalty
and a one-match ban for showing
his underwear.
Croatia were punished after fans
made monkey chants towards Italy
striker Mario Balotelli during a
Euro 2012 group game, while
Bendtner was rapped for exposing
pants bearing the name of a well
known bookmaker as he
celebrated a goal.
Manchester City captain Vincent
Kompany wrote on Twitter: “Uefa
might need to review their order
of priorities, don’t you think?”
WEDNESDAY 20 JUNE 2012
30
SPORT
cityam.com/sport
BY FRANK DALLERES
BY SPORTS DESK STAFF
Croatia fined less for racism than
Bendtner is for flashing pants
Captain Cook
steers England to
poignant one-day
series clincher
ENGLAND 1
UKRAINE 0
BY FRANK DALLERES
EURO 2012
Rooney, making a first England start since his October red card in Montenegro, headed in Steven Gerrard’s cross from close range
Tomorrow, Warsaw: Czech Rep v Portugal
Friday, Gdansk : Germany v Greece
Saturday, Donetsk : Spain v France
Sunday, Kiev : England v Italy
EURO 2012
QUARTER-FINALS
Maynard remembered in
West Indies match: Page 29
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cushions not included unless otherwise stated. Mobile charges may apply when calling 0800 110 5000. DFS is a division of DFS Trading Ltd. Registered in England and Wales No 01735950. Redhouse Interchange, Doncaster, DN6 7NA.
Visit your nearest store, order direct at www.dfs.co.uk or call free on 0800 110 5000 24 hours a day, 7 days a week
4 years interest free credit on everything
Or pay nothing until January 2013 then take 3 years
interest free credit
0
%
REPRESENTATIVE
APR
No deposit with 4 years interest free credit. 48 equal monthly payments of £31.22. Or pay nothing until January 2013 then 36 equal monthly payments of £41.63. 0% APR. Total £1499.
50%
OFF
RIVO COLLECTION
SOFAS
ACTION
CHAISE END SOFA
WITH BED AND STORAGE
HALF PRICE
£1499
HEADREST OPTIONAL EXTRA
AFTER EVENT PRICE
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