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Browne hired: Budget row:

WHITEHALL 600,000
RECRUITS STATE JOBS
TOP CEOS p6 TO GO p2-3
Issue 1,167 Thursday 1 July 2010
BUSINESS WITH PERSONALITY FREE
www.cityam.com

FUNDS TO BE HIT THE GIRL


THAT’S GOT
BY BONUS RULES
■ Cash bonuses to be
MEN SUSSED
CITY A.M.’S
ZOE
capped at 30 per cent STRIMPEL
■ Hedgies and investment HER NEW
firms fall into EU’s net BOOK: P22
■ Politicians say clamp
down will end risk-taking

FINANCIAL SERVICES
BY OLIVER SHAH
HEDGE funds and asset managers will be
caught in the tough crackdown on bankers’
bonuses put forward by European Union
politicians and member states last night.
In the harshest measures yet proposed for
pay deals in the financial sector, lawmakers
and countries said the cash portion of a
bonus will be capped at 30 per cent of the
total amount, or 20 per cent for particularly
large handouts. Up to two thirds of a bonus Arlene McCarthy MEP said the rules would “transform bonus culture” Picture: PHOTOSHOT
will have to be staggered over three to five
years, and at least half of the upfront ele- wrought havoc with the global economy and community and would suffer more than any
ment will need to be in shares or other secu- taxpayers paid the price. The public want other member of the 27-state bloc.
rities linked to the institution’s banks to prioritise stability and lending over Other steps detailed in the EU legislation
performance. their own pay and perks.” include tripling the amount of capital banks
The rules, due to be rubber-stamped in It is thought hedge funds and investment would need to hold against their trading
Strasbourg next Wednesday, mark a water- houses will be caught up in the red tape. Last positions compared to pre-crisis levels, forc-
shed moment in governments’ ability to dic- night the European parliament was scram- ing lenders to reveal the number of employ-
tate terms to the world’s most powerful bling to clarify the clampdown’s scope, but a ees earning more than €1m (£820,000) and
companies. They come two years after the spokesman said all outfits dealing in credit asking directors of taxpayer-backed banks to
financial crisis brought Lehman Brothers to would be affected. An announcement is justify their bonuses.
its knees and prompted desperate state res- expected this morning. Angela Knight, chief executive of the
cues of firms like American International While British banks have already signed British Bankers’ Association, emphasised the
Group and Royal Bank of Scotland on either up to strict guidelines on bonuses – includ- efforts UK-based banks had made to bring in
side of the Atlantic. ing those such as Barclays and HSBC who did G20-agreed standards on bonuses. “The
Arlene McCarthy, the MEP responsible for not take direct aid – the EU’s restrictions main consequence of this European decision
pushing through the agreement, said: “A would hit fund managers hard. London is that other European countries will now
high-risk and short-term bonus culture hosts 80 per cent of Europe’s hedge fund have to follow suit,” she said.

BARCLAYS WARNS ON DEALS


BANKING and acquisitions (M&A) activity.” Setting out his strategy after taking over

BY OLIVER SHAH Lucas’ comments fit in with guidance in November, global head of retail banking
from other European institutions, many of Antony Jenkins said Barclays would aim to
BRITISH titan Barclays yesterday warned of a whom have said investment banking busi- be a top-five player in the UK, France, Italy,
slowdown in investment banking activity in ness slumped in the second quarter as exec- Spain and Portugal. The bank will spend
the past two months, suggesting wilting utives and investors took fright at the £250m every year until 2014 refurbishing
confidence in corporate boardrooms is burgeoning Eurozone debt crisis. Analysts at branches and overhauling IT systems in a bid
impacting on dealmaking revenues. MF Global estimate the drop-off in corporate to steal market share from its rivals. Jenkins
Barclays finance director Chris Lucas told work could hit investment banking profits said the growth would be largely organic.
an analyst conference investment banking by up to 40 per cent across the board. Analysts expect Barclays to report net
market conditions in May and June were Barclays, which is trying to rebalance its income of £3.8bn this year, down nearly two
“softer” than those seen in the first quarter, model away from dependence on BarCap’s thirds from £9.4bn in 2009, according to
when Barclays Capital generated revenues of earnings, also laid out a wide-ranging plan Bloomberg.
£3.8bn and profits of £1.5bn. for its consumer operation, which will see
Lucas said: “[This particularly reflected] £1bn invested over the next four years to Certified Distribution
lower levels of capital markets and mergers improve customer service. 03/05/10 - 30/05/10 is 106,097

FTSE 100 ▲ 4,916.87 +2.65 DOW ▲ 9,774.02 +96.28 NASDAQ t 2,109.24 -25.94 £/$ t1.49 -0.01 £/¤ t1.22 -0.01 ¤/$ 1.22 unc
2 News CITYA.M. 1 JULY 2010

Moody’s mulls
Reforms needed to boost private jobs cutting Spanish
would willingly bet on it. As I wrote in
this space yesterday, small-state
economies almost invariably create
high and many firms are nervous
about hiring new staff lest they be
forced to let them go again if the econ-
incentive to protect frontline services
delivered to their paying consumers.
There was some good news for the
triple-A rating
more jobs than countries heaving omy tanks, incurring high costs in the coalition yesterday. After shrinking by


under the burden of a bloated govern- process. Meanwhile, close to 6m 14 per cent over the past two years, ECONOMY
ment – and the coalition plans a sub- adults are stuck on out of work bene- Ireland officially exited recession:
stantial reduction in public spending fits, an appallingly high figure which gross domestic product grew 2.7 per MOODY’S Investors Service said yes-
as a share of GDP over the next five has barely changed over the past 15-20 cent in the first quarter. It is hardly a terday it was reviewing Spain’s rat-
EDITOR’S LETTER years, a real step in the right direction. years. Inexcusably, the structure of the perfect situation: gross national prod- ings and may lower them by as much
It may be that the five-year increase in welfare state is such that many of uct, which strips out profits repatriat- as two levels due to sliding growth
ALLISTER HEATH private jobs of 1.95m forecast by the these unemployed folk would be ed by global firms, still fell, as did expectations and mounting fiscal
OBR (and the overall rise of 1.34m in worse off were they to get a job. employment, but it is clear that challenges.
A MAJOR question dominated the employment) will turn out to be a lit- The real challenge is that it looks Ireland has almost finished extracting The ratings agency, the only major
debate in Westminster yesterday: will tle over-optimistic; but I still think it increasingly as if the wrong jobs will itself from a truly disastrous down- agency that still maintains a top rat-
the private sector create enough jobs will more than cover the predicted be cut. It is always thus: government turn. Yet Ireland has also just pushed ing for Spain, said it was conducting a
to compensate for the looming blood- 610,000 reduction in state sector jobs departments, as part of a desperate PR trough an extremely sharp fiscal tight- three-month review of the country’s
bath in the public sector? The Office and the substantial drop in state- offensive, always imply that it is front ening, against the advice of Keynesian triple-A local and foreign currency
for Budget Responsibility, the new financed but nominally private jobs line services and staff that will be axed economists. The fact that this hasn’t government bond ratings.
independent official forecasting out- that will also go as a result of the as a result of cutbacks. The burgeon- prevented Ireland’s gradual recovery, The rating agency also cited con-
fit, believes it will, as does the govern- squeeze in spending. ing army of managers, administrators contrary to Keynesian warnings, con- cerns over the impact of rising fund-
ment; the opposition, the unions and But the government also needs to and others – those people in charge of firms that the coalition is broadly ing costs over the medium term. “If at
the left-wing media, unsurprisingly, do more when it comes to incentivis- the hirings and firings – will try to right: reducing the deficit and bring- the conclusion of the review, Spain’s
disagree. ing employers to hire, and potential protect themselves. This is in stark ing the national debt back under con- ratings are lowered, it would most
The truth, as ever, is more complex: employees to work, than it is currently contrast to the private sector, where trol is the only way forward – and the likely be by one, or at most two,
it is likely that growth in private sec- doing. It is a massive hassle for firms efficiency gains of 10 per cent or more only way to create a new generation of notches,” Moody’s said.
tor employment will outstrip the to employ people; there is more red were routine during the recession – truly sustainable jobs. Spain has been the target of specu-
reduction in state sector jobs. In fact, I tape than ever, taxes on labour are and where management had an allister.heath@cityam.com lation in sovereign debt markets.

7th Floor, Centurion House,


24 Monument Street,
London, EC3R 8AJ
US reform bill
gets key vote
Tel: 020 7015 1200 Fax: 020 7283 5334
Email: news@cityam.com www.cityam.com
Editorial
Editor Allister Heath
Deputy Editor David Hellier
News Editor Ben Griffiths
Night Editor Katie Hope
REGULATION eventually, but Democrats’ hopes of

Associate Editor David Crow


Lifestyle Editor Zoe Strimpel BY HARRY BANKS sending a bill to him to sign into law by ECB President Jean-Claude Trichet wants to see less emergency liquidity Picture: REUTERS
Art Director Darren Soulsby the 4 July Independence Day holiday

Relief at low ECB take-up


Pictures Alex Ridley THE US House of Representatives yes- were dashed. The death of Democratic
terday approved a landmark overhaul senator Robert Byrd and cold feet
Commercial of financial regulations but the among Republican allies has complicat-
Sales Director Jeremy Slattery Senate put off action until mid-July, ed efforts to round up the votes needed
Commercial Director Harry Owen delaying a final victory for President in the Senate.
Head of Distribution Nick Owen Barack Obama. The bill would impose tighter regula-
Still, the 237 to 192 vote in the tions on financial firms and reduce ECONOMY have rocked stock markets and

Distribution helpline House marked a win for Obama and their profits. It would boost consumer weighed on the euro this week. Only
If you have any comments about the distribution BY KATIE HOPE
of City A.M. Please ring 0207 015 1230, or email his fellow Democrats, who have made protections, force banks to reduce risky 171 banks borrowed a total of
distribution@cityam.com the most sweeping rewrite of Wall trading and investing activities and set FEARS over the health of the €131.9bn in three-month liquidity –
Street rules since the 1930s a top pri- up a new government process for liqui- Eurozone financial system were compared with forecasts that
Editorial Statement ority in the wake of the 2007-2009 dating troubled financial firms. eased yesterday after the European demand might exceed €300bn.
This newspaper adheres to the system of financial crisis. Central Bank (ECB) reported much “It’s definitely a good sign and
self-regulation overseen by the Press Complaints “That’s why were are here today, to US President Barack lower demand than expected for its means there is still some interbank
Commission. The PCC takes complaints about the make sure that never happens again,” three-month liquidity to replace lending occurring within the
editorial content of publications under the Editor’s Obama is unlikely to sign
Code of Practice, a copy of which can be found at House Speaker Nancy Pelosi said. “We €442bn (£361bn) in 12-month loans European money market, and that
www.pcc.org.uk will pass the toughest set of Wall the new US reform bill that expire today. it’s not just a vertical relationship
Printed by Newsfax International,
Street reforms in generations.” into law before 12 July The auction, seen as a test of the between banks and the ECB,” said
Beam Reach 5 Business Park, Analysts say Obama is all but cer- due to delays sector’s health, temporarily eased Gilles Moec, economist at Deutsche
Marsh Way, Rainham, Essex, RM13 8RS tain to get the measure on his desk concerns about bank finances which Bank.

WHAT THE OTHER PAPERS SAY THIS MORNING


GOOGLE HIT BY FRENCH RULING
Google is facing a new regulatory bat-
tle after French antitrust authorities
ARCELORMITTAL FINED €276M FOR yesterday said the US internet group ROYAL MAIL PICKS ADVISER AS SALE STANDARD & POOR’S GIVES NOTICE OF SWATCH TAPS FOUNDER’S DAUGHTER
PRICE-FIXING had abused its dominant position in SPECULATION INTENSIFIES A POTENTIAL DOWNGRADE ON... TO LEAD BOARD
ArcelorMittal, the world’s biggest the web advertising market when it Royal Mail has appointed Barclays MOODY’S Two days after the death of Swatch
steel producer, has been fined barred a location data company from Capital as its investment banking Any lingering doubts about the tough Group founder and chairman Nicolas
€267.5m ($339m) for the part that its using its AdWords service. The adviser in preparation for a possible times to come for ratings agencies Hayek, the Swiss watch and luxury
companies played in one of the most Autorité de la Concurrence was sale or partial flotation of the busi- have blown away as Standard & Poor’s goods maker said yesterday his
wide-ranging and long-running car- responding to a complaint filed in ness by the government. The state- put the debt of one of its largest rivals daughter Nayla Hayek has been elect-
tels to come to light in Europe. In all, February by Navx, a Paris-based pro- owned business has not had an on notice for a potential downgrade. ed as his successor and will head the
17 steel manufacturers were involved, ducer of information on speed cam- investment banking adviser since NM In a report that could equally have company’s board. Hayek died on
and were given fines totalling era locations and petrol prices. Rothschild stepped down last July been written about its own prospects, Monday from heart failure aged 82.
€518.5m yesterday, with after Lord Mandelson, the business S&P credit analyst Emile Courtney
ArcelorMittal’s being the largest sin- APPLE’S IADS TO HERALD NEW ERA secretary at the time, saw his bill to laid out a grim picture for rival rat- AMAZON.COM ACQUIRES ONLINE
gle penalty. A new type of mobile phone advertis- part-privatise Royal Mail scuppered ings agency Moody’s. SHOPPING SITE WOOT
ing for the iPhone will be launched by bankbench Labour MPs. Seattle online retail giant
AXA ROSENBERG CHAIRMAN QUITS today by Apple, spurring a fast-grow- INFLATION PUSHES UP PRIVATE Amazon.com acquired deal-of-the-day
Barr Rosenberg, a pioneer of comput- ing market but raising worries for HALF A MILLION SONY VAIO SECTOR PAY INCREASES site Woot for an undisclosed sum.
er-driven risk management and many developers of applications for COMPUTERS AT RISK OF OVERHEATING Private sector employers are coming Following the acquisition, Dallas-
investment, has resigned as chairman the device. Big companies from Sony is the latest consumer electron- under increasing pressure to offer based Woot will continue to be man-
of Axa Rosenberg after an investiga- Nissan to Sears to Citigroup have ics company to experience product inflation-busting pay rises to staff as aged independently, the companies
tion into errors in the data systems already committed to spending $60m issues after it warned that over half a the economy picks up, new figures said. “The acquisition will foster the
used by the US asset manager he co- this year on Apple’s iAds, which will million of its Vaio computers could be have shown. However, one in 10 com- long-term growth of Woot, allowing
founded in 1985. Tom Mead, director open within a small number of the in danger of overheating. However, panies are still pushing through pay it to continue its passion for serving
of research, has also quit the board hundreds of thousands of applica- the company denied reports that it freezes, analysis by Income Data customers with low prices across a
and is leaving the group. tions on the iPhone. was to launch a major recall. Services has revealed. broad selection of products,” it said.
CITYA.M. 1 JULY 2010 News 3

Cameron defends NEWS | IN BRIEF


Lloyds set to cut 650 jobs

Budget as 610,000
Part-nationalised Lloyds Banking Group
is to cut 650 jobs and stop using a net-
work of independent agencies, prompt-
ing the closure of 265 of them and
potentially the loss of hundreds more

public jobs to go
jobs. Lloyds, which is 41 per cent owned
by the UK government, said the closure
of an insurance site in Nottingham, cen-
tral England and cuts at other locations
will result in the net loss of 650 perma-
nent full-time jobs. The bank also said it
will cease using the Halifax Independent
POLITICS decision to freeze public sector pay. Agency business.

BY STEVE DINNEEN A Treasury spokesman told City A.M.


these losses are “unavoidable”. BSkyB to increase sports prices
DAVID Cameron was forced to defend David Cameron and caretaker British Sky Broadcasting will today
his government‘s public spending cuts Labour leader Harriet Harman clashed reveal a hike of between 11 and 36 per
yesterday when it emerged an estimat- over the issue during Prime Minister’s cent to the wholesale and retail cost of
ed 610,000 public sector jobs will be Questions, with the Labour leader its sports channels, according to the
lost. claiming the job losses would create Financial Times. The higher charges on
The report by the Office for Budget “abject misery”. Cameron countered, companies like BT and Virgin Media
Responsibility (OBR) forecasts one in accusing Harman of scoring “a spec- mean BSkyB will be charging almost as
eight public sector jobs will be shed by tacular own goal”, given the cuts are much as when Ofcom, the regulator,
the end of this parliament. expected to result in an overall rise in intervened to force it to slash its prices.
However, the report also estimates employment.
the private sector will generate an The issue rocketed to centre stage Polyus and KazakhGold eye LSE
extra 1.95m extra jobs – and that the after a separate leaked Treasury memo Cameron said Labour had scored a “spectacular own goal” Micha Theiner/City A.M. Russian miner Polyus will list on the
overall rise in employment will be suggested as many as 1.3m jobs would London Stock Exchange and probably
around 1.3m over the next five years. be lost over the course of the next par- BUDGET FORECAST | HOW THE FIGURES PAN OUT enter the FTSE 100 following its merger
Overall employment will rise in every liament, with 600,000 staff being shed with KazakhGold. The fused entity will
year of the this parliament. from the public sector and 700,000 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 have a market value of £6.7bn and is
The report claims public sector jobs from private firms dependent on state expected to be chaired by Mikhail
would have fallen even quicker over contracts. However, it also said that Total employment 28.89m 29.08m 29.36m 29.69m 29.97m 30.23m Prokhorov, Polyus’ owner. Polyus said
the next two years under Labour pro- the private sector would create 2.5m Public sector employment 5.53m 5.47m 5.39m 5.23m 5.04m 4.92m that it would delist its shares in Moscow

@
posals, largely due to the coalition’s new jobs, boosting total employment. to seek a primary listing on the LSE.

Tate & Lyle is poised


for sale to a US firm
@
COMMODITIES direct employees. Another sugar er, bought Tate & Lyle’s Canadian

BY JENNY FORSYTH refinery in Lisbon, Portugal, would sugar refining and packing opera-
also be included in the deal. tions in 2007, but this would be its
BRITISH company Tate & Lyle is The sale fits with business plans of first move into Europe.
expected to sell its historic sugars Tate & Lyle chief executive Javed Yesterday Tate & Lyle and
business to US rival American Sugar Ahmed, who took over from Iain American Sugar refused to comment.
Refining for around £200m. Ferguson last October. He is keen to
The deal, which is due to be focus on higher-margin products, ANALYSIS l Tate&Lyle
announced officially today, is likely to such as its industrial food ingredients 500 p

@
cause anger over the loss of yet anoth- business. 450.90
er UK business – coming, as it does, Last month Ahmed said Tate would 480 30 Jun
after the sale of Cadbury to Kraft. be split into three global divisions:
The sale would mark the first speciality food ingredients, including 460
change of ownership for the brand – artificial sweeteners; bulk ingredi-
including the world’s oldest, Lyle’s ents; and sugars. The idea was to use 440
golden syrup – since the firms were cash from the last two divisions to
established around 130 years ago. A grow the first. 420
deal would affect workers at the two American Sugar Refining, North
400
London plants, where there are 550 America’s largest cane sugar produc- 21 Apr 12 May 2 Jun 22 Jun

Ex-New Star hedgie reveals


figures from comeback firm
FUND MANAGEMENT down 1.9 per cent, against a 7.4 per Recently we have been reducing our

BY OLIVER SHAH cent drop in the FTSE 100. dollar exposure and increasing ster-
Miller surprised the City when he ling. We’re increasing our equity
ALAN Miller, the former hedge fund joined forces with socialite Alexander exposure as values look attractive.”
high-flyer who quit New Star Asset Spencer-Churchill to set up the firm The one-year numbers cement
Management following a messy in March 2009. Although he built his Miller’s return to running money. He
divorce, has revealed market-beating reputation as a successful stock-picker hit the headlines in 2005 when his
figures from his comeback venture. at Gartmore Investment, Jupiter Asset then-wife, Melissa, won a £5m settle-
Just over a year after launching Management and New Star, SCM’s ment in a bitter public divorce. Miller
Spencer-Churchill Miller (SCM) portfolios are made up from passive pursued an appeal to the House of
Private, a boutique wealth manager, exchange-traded funds (ETFs). Miller Lords but lost. He left New Star in
Miller said his two portfolios had and his co-manager Simeon Downes early 2007 to take a break from work. MORE NEWS WWW.GANTUK.COM

dodged most of the downside suf- entirely shun company analysis in SCM, which Miller runs with his
fered by UK equities. SCM Absolute favour of macro-economic calls. new wife, Gina, has just under £100m
ONLINE BROMPTON ROAD, BOND STREET, REGENT STREET,
WESTFIELD, BLUEWATER, CANARY WHARF,
Return fell 0.1 per cent for the year to Miller told City A.M. yesterday: “We on its books. It plans to grow to up to www.cityam.com RICHMOND, CAMBRIDGE, BRISTOL, SOLIHULL,
MANCHESTER, EDINBURGH, GLASGOW
yesterday and SCM Long-Term was always try and be contrarian. £500m in the next few years.
4 News CITYA.M. 1 JULY 2010

London is in danger of losing


its status as top business base
when 96 per cent of firms viewed have real concerns over the impact of

FINANCIAL SERVICES
BY KATIE HOPE London as the top business venue. the new 50 top personal income tax
A triple whammy of overall busi- rate, with almost two thirds (57 per
LONDON is in danger of losing its ness operating costs, the high rate of cent) of businesses believing it will hit
standing as the premier place to do both personal and corporate tax and London’s popularity as base.
business, according to an influential London’s creaking transport system, In light of the findings, the CBI is
survey published today. were cited by London-based firms as lobbying Prime Minister David
While four fifths of chief execu- their key concerns over using the cap- Cameron to slash both regulation
tives continue to rate the capital as a ital as a business base, according to and tax to ensure London retains its
good or very good place to do busi- the bi-annual survey by accountancy global competitiveness. “We must
ness, this has fallen by six per cent in firm KPMG in conjunction with busi- ensure it (London) can compete with
the past six months, and by almost a ness lobby group the CBI. other cities globally,” said Nigel
fifth since its peak three years ago The survey indicates that firms Bourne, director of CBI London.

BP protestors demonstrate in front of Tate Britain where BP is a key sponsor Picture: PA

BP execs face
angry locals
loans amounting to around $5bn to
BP IN CRISIS help it tackle growing liabilities as a
BY EMMA SADOWSKI result of the oil spill.
Meanwhile, the oil giant was heavi-
BP’S TOP executives are preparing to ly criticised by US representative Ed
face hundreds of angry New Orleans Markey yesterday for failing to factor
residents in a “town hall” style meet- hurricanes into its spill policies.
ing after a presidential commission Markey’s comments come as BP’s
investigating the Gulf of Mexico spill clean-up efforts have been delayed as
has called for a hearing. the Gulf region is by tropical storm
The commission, which is headed Alex. Although the oil major’s surface
by former Environment Protection operations have stopped, the group
Agency (EPA) administrator William said that underwater drilling and
Reilly, has called for the hearings to containment efforts continue.
start 12 July and is likely to be attend- But BP took a further hit yesterday
ed by up to 500 locals. after it was ordered to pay a $5m
A spokesperson from BP said that (£3.3m) fine for “submitting false or
the company will co-operate with any misleading” reports for energy out-
government requests but would not put on tribal lands in Colorado.
confirm who will attend.
It is understood that chief execu- ANALYSIS l BP
tive Tony Hayward has told Reilly that 700 p
he promises to co-operate with the 650
318.90
30 Jun
commission. 600
The national commission on the BP 550
Deepwater Horizon oil spill and off- 500
shore drilling was established by US 450
president Barack Obama to conduct 400
an independent probe into the causes 350
of the Gulf spill. 300
The news comes as BP is believed to
250
be seeking additional short-term 21 Apr 12 May 2 Jun 22 Jun

US Congress calls for unlimited


damages for oil firm accidents
pushed through a bill eliminating

ENERGY
the $75m (£50m) cap on liability that
BP could face unlimited liability for oil companies currently enjoy for
the Gulf of Mexico spill if a Senate bill damages from offshore spills.
becomes law. The committee’s vote would open
US Congress yesterday vowed to get the oil industry to potentially unlim-
tough on offshore drilling practices, ited compensation for economic loss-
calling for both unlimited liability for es suffered by local businesses and
oil firms that cause spills and a communities and for damages to nat-
refusal to give offshore leases to com- ural resources.
panies with poor track records. The change, if approved and made
At the Senate’s environment and law, would apply retroactively to BP’s
public works committee, Democrats massive Gulf of Mexico spill.
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6 News CITYA.M. 1 JULY 2010

AstraZeneca is top riser on


FTSE 100 after a patent win
court battle now means that ANALYSIS l AstraZeneca


PHARMACEUTICALS
AstraZeneca can sell the drug in the 3,200 p 3,169.00
PHARMACEUTICAL giant AstraZeneca US without the competition from 30 Jun
has won a landmark patent dispute generic and cheaper drugs companies 3,100
in the US, sending its shares up for the next six years.
almost nine per cent on the news. “We are pleased with the court’s 3,000
US judge Joseph Farnan, who sits in decision upholding the validity and
the district of Delaware, ruled that enforceability of the patent. The 2,900
the patent on AstraZeneca’s choles- court’s decision reaffirms the
2,800
terol drug Crestor was “valid and strength of the intellectual property
enforceable”. protecting Crestor,’’ said David 2,700
AstraZeneca boss David Brennan saw shares rise after a patent victory Picture: REUTERS The conclusion of the three-year Brennan, AstraZeneca chief executive. 21 Apr 12 May 2 Jun 22 Jun

Browne joins
government
as super-boss
Browne will shortly appoint a fur-

POLITICS
BY OLIVER SHAH ther 16 leading figures from the busi-
ness community to beef up the
FORMER BP chief executive Lord boards of every government depart-
Browne was confirmed as the coali- ment. Sir Nigel Rudd, the chairman
tion government’s “super-director” of BAA and Invensys, and Ian
yesterday in a controversial move that Watmore, the former chief executive
puts him at the heart of Whitehall. of the Football Association, are
The peer accepted the Liberal expected to be among them.
Democrats and Conservatives’ invita- Together, the 17 big-hitters will
tion to take the unpaid post of “lead overhaul the way departments report
non-executive director” in the and set up three-year rolling plans to
Cabinet Office. He will be tasked with keep secretaries of state in check.
injecting private sector thinking into Cabinet Office minister Francis
the civil service, which has often been Maude said: “The appointment of
accused of waste and overstaffing. non-executive directors will galvanise
Browne won plaudits in the busi- departmental boards as forums
ness community for his 12-year stint where political and official leader-
at the top of BP, but was forced to ship is brought together to drive up
resign in disgrace in 2007 after lying performance.”|
in court about his relationship with Browne said the role, tapping his
another man, Jeff Chevalier. His years of expertise, was “within gov-
career was also marred by the Texas ernment but also independent of it”.
City refinery fire in 2005 and the
Prudhoe Bay pipeline fractures in Cabinet Office minister
2006. Questions have been raised Francis Maude said
about the culture of cost-cutting Browne’s appointment
instilled by Browne during his time at
the FTSE 100 oil giant given the tech- would help Whitehall
nical failures leading to BP’s ongoing be more businesslike
Gulf of Mexico disaster.

LORD BROWNE OF in 1987. By 10 June 1995, he was


MADINGLEY group chief executive of BP.
Browne was knighted in 1998 and
FORMER CHIEF made a life peer in 2001. He was an
established and well-respected part
EXECUTIVE, BP of the City landscape in 2007 when a
Sunday tabloid printed a kiss-and-tell
story from a former gay lover, Jeff
Chevalier.
FOR a man with a diverse range of Browne had kept his sexuality
interests, Edmund Browne – since secret throughout his career in what
2001, Lord Browne of Madingley – is a notoriously testosterone-driven
was monogamous to BP for 40 years. industry. In an attempt to get an
Born in Hamburg, Germany, and injunction against the newspaper,
educated at St John’s College, Browne lied to BP’s lawyers and then
Cambridge, Browne joined the energy to a court about how he met
behemoth in 1966 when it was still Chevalier. When he was exposed, he
known as British Petroleum. He clam- was forced to step down as chief
bered up the ranks, working in explo- executive 18 months earlier than he
ration and production posts in Alaska, had previously planned.
San Francisco, London and Canada. Since then, Browne has worked as
Browne took senior roles at the chairman of the Tate Gallery and
Standard Oil Company in Cleveland managing director of Riverstone
after its merger with BP, becoming Holdings, a private equity firm spe-
chief financial officer of BP in America cialising in energy companies.
CITYA.M. 1 JULY 2010 News 7

Resolution rises on deal plans


but bosses half-miss cash call
ago. Analysts and investors’ faith in recycled from fees payable to


INSURANCE
BY OLIVER SHAH entrepreneur Clive Cowdery’s ambi- Resolution’s in-house team for
tious project has been partially arranging the takeover. The prospec-
RESOLUTION shares made their steep- restored by the long-awaited move on tus said the directors would also sell
est one-day gain in eight months yes- AXA’s life and pensions business. rights in order to take up some of the
terday as the insurance consolidation A £2bn cash call to part-finance the remainder – a process known as
vehicle released details of its rights deal will begin on 21 July and close on “swallowing the tail”.
issue and £2.8bn takeover of AXA UK. 5 August. Resolution directors includ- A spokesperson defended the
Resolution’s paper, which has ing Cowdery, John Tiner, Jim team’s decision not to participate
slumped since November, rose five Newman and Ian Maidens will take fully in the rights issue. “ They clearly
per cent to 63p in the first trading up roughly half their allotment of don’t have that kind of money in
since it was suspended a fortnight rights – £8m – with £4.5m of that their current accounts,” he said.

FX & CFD Trading. Worldwide.


Worldwide.
AgBank of China chairman Xiang Junbo is working towards the IPO Picture: REUTERS

StanChart in
AgBank IPO
Celebrating the

World Cup 2010


ner with access to its international

BANKING
BY STEVE DINNEEN footprint.
This could include access to capital
STANDARD Chartered is set to invest markets, international trade corri-
$500m (£334m) in Agricultural Bank dors, financial markets and con-
of China’s initial public offering in sumer finance sectors, and share
Hong Kong, becoming one of the information, research and staff train-
institution’s major stakeholders. ing, Standard Chartered said.
AgBank hopes to raise more than AgBank is the last of China’s big
$20bn in a Hong Kong and Shanghai four banks to list its shares and the
float, in a listing that is expected to first to do so without first bringing in
value AgBank at a staggering $150bn. a major foreign strategic investor.
Standard Chartered will buy just
over two per cent of the new shares ANALYSIS l Standard Chartered
on offer, giving it a stake of about 0.3 1,850 p 1,641.00
per cent in the enlarged bank. 30 Jun
1,800
The two banks this month signed
an agreement to work together on a 1,750
series of new business opportuni- 1,700
ties.
The bank, which is based in 1,650
London but makes over four-fifths of
1,600
its profits in Asia, aims to take advan-
tage of AgBank’s extensive domestic 1,550
network, in return providing its part- 29 Mar 21 Apr 12 May 2 Jun 22 Jun

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Analysis by Katie Hope


8 News CITYA.M. 1 JULY 2010

RSM Tenon picks up


gems from Vantis
The Vantis group collapsed after Raynor said the new businesses,


ACCOUNTING
BY DAVID HELLIER it fell into financial difficulties, which focus on advice to entrepre-
rocked by having difficulty in recov- neurs as well as turnaround servic-
RSM Tenon, the fully listed UK ering more than £10m of monies es, will double the size of RSM’s
accounting and business services owed to it for its work on the operations in London.
group, yesterday bought certain administration of Stanford The businesses currently have a
business assets from its rival Vantis, International. revenue of £27m.
which collapsed on Tuesday Its reputation was affected by Raynor says the cost of acquiring
evening. two tax partners being charged for the assets amount to just more
RSM, which moved to the main malpractice by the UK tax authori- than £4m.
market in May this year, is buying ties.
businesses worth up to £6.8m from At one point Vantis shares traded RSM Tenon chief
the administrators of Vantis, taking at 210p giving the group a market executive Andy
325 people on board. capitalisation of around £110m.
Chief executive Andy Raynor said Now shareholders are unlikely to Raynor says the
his firm was buying “a good busi- receive anything after creditors acquisition will be
ness which was being taken out of a have the first claim on any money earnings enhancing
difficult situation.” the administrators can bring in.

Worst quarter for CITY VIEWS: ARE YOU WORRIED ABOUT STOCK MARKET TURBULENCE?
Interviews by Marion Dakers

stocks since 2008 PETER WALTON | BT


“It is always going up or down. The uncertainty does make it difficult for institu-
tional investors to manage very large portfolios. It goes up or down for often
rates on consumer loans including unknown reasons, and I don’t get too concerned about short-term undula-

MARKETS
BY HARRY BANKS mortgages, was close to four per cent.
By the quarter's end, it had fallen to
tions in the indices.”
THE stock market closed out a painful 2.94 per cent.
second quarter yesterday and left On the last day of the April-June
investors with heavy losses and far period, the Dow lost 96 points, and all
ANGIE TABBINER | CITY OF LONDON
more doubts about the economy than the big indexes were down about one
they had just months ago. per cent.
Stocks had their worst quarterly Using the S&P 500 as a benchmark, “I wouldn’t say I was worried about it. It feels like it’s under control, as much as
performance since the financial cri-
sis. The Standard & Poor’s 500 index,
stocks had their worst quarterly loss
since the fourth quarter of 2008,
a stock market can be. I think it will balance itself out. I can understand that it
considered by many professional when the index plunged 22.6 per makes some people concerned, when they have so much of their own
investors to be the best measure of cent. For the first half, the index is
the market’s health, lost 11.9 per down 7.8 per cent, its worst first-half money riding on short term rises and falls.”
cent, while the Dow Jones industrial showing since the 13.8 per cent it loss
average lost 10 per cent. Both indexes at the start of 2002.
are at their lows for 2010. Meanwhile, trading saw the FTSE ANTONY DENCH | PCL WHITEHALL
Meanwhile, Treasury notes and 100 index up by 2.65 points or 0.1 per
bonds soared during the quarter, driv- cent yesterday. Weak mining and
ing interest rates sharply lower, as banking stocks weighed heavily on “My opinion is that I’m very worried about it. I don’t know that it’s turbulent as
investors turning away from stocks
sought a place where their money
the index but a strong performance
from AstraZeneca kept the index in
such; it seems to be moving downwards pretty convincingly. I don’t follow the
would be safe. In the early days of the the green as it closed at 4,916.87. This day to day numbers that closely, but the big picture is pointing down. But
quarter, the yield on the Treasury’s is 13.4 per cent lower than at the start
10-year note, used as a base for setting of the second quarter. MARKETS:P20 then some people make their livings betting on stocks falling.”
CITYA.M. 1 JULY 2010 News 9

BBC executives
AIG’s Sullivan says face 8.3pc pay
risks were not clear cut in two years


MEDIA
became aware of the CDS (credit THE BBC’s top executives will take a


INSURANCE
default swap) portfolio in 2007. I was voluntary 8.3 per cent pay cut over
BY JENNY FORSYTH receiving reports, but they didn’t the next two years, the chairman of
BRITISH-born former AIG chief execu- indicate any problems with the port- the broadcaster’s sovereign body, Sir
tive Martin Sullivan yesterday admit- folio.” Michael Lyons said yesterday.
ted he did not know in 2005 about Meanwhile, Joseph Cassano told The new deal will mean working 12
the huge increase in risk the firm’s the panel he could have saved taxpay- months for 11 months’ salary.
financial products unit had taken on. ers billions of dollars by negotiating He also called for director-general
A US inquiry panel investigating harder with banks, including Mark Thompson to be open with
the financial crisis yesterday quizzed Goldman Sachs. licence fee payers by publishing the
Sullivan and other former AIG bosses Cassano, who retired from AIG in salaries of the BBC’s top-paid enter-
including Joseph Cassano, who ran March 2008, said: I would have been tainers, such as Jeremy Clarkson and
AIG’s financial products arm in able to negotiate substantial dis- Graham Norton.
London, about the collapse of AIG in counts such that the taxpayer would Lyons said that because the pay
2008 that ended in a government not have had to accelerate the $40bn cuts came on top of recent pay freezes
bailout in late 2008 costing $182bn. to the counterparties... I can see the and forgone bonuses, in real terms
Its problems were linked to deriva- counterparties were paid off at 100 top BBC executives’s remuneration
tives contracts of over $1 trillion. cents on the dollar. I don’t know how would have dropped by 25 per cent
Former AIG boss Martin Sullivan said he was unaware of the risk Picture: REUTERS Sullivan told the enquiry: “I only the negotiations went.” between 2008 and next year.

Insider trading fine


for ex-Soc Gen boss
alised debt, to see the shares at a Last Friday, the trial of former

REGULATION
BY JENNY FORSYTH profit. Societe Generale trader Jerome
The AMF added that by the time Kerviel ended, with his defence
FORMER Societe Generale invest- Robert Day sold 1.4m SocGen team calling for him to be acquit-
ment bank head Jean-Pierre shares on his own account between ted of charges of breach of trust
Mustier has been fined €100,000 mid-December 2007 and January and forgery relating to a €4.9bn
(£81,950) by France’s AMF financial 2008, he was not trading on inside trading loss in 2008 that almost
regulator over insider trading as information. brought SocGen to its knees. He is
the financial crisis began. Jean Veil, lawyer for Mr Mustier pleading guilty to a third charge of
Former SocGen non-executive said the former executive, who computer abuse.
director Robert Day has been resigned from the bank in August The public prosecutor is calling
cleared as part of the same investi- 2009 when the AMF investigation for a five-year prison sentence for
gation, the AMF said yesterday. began, would appeal against the all the charges. He may also face a
The watchdog said that Mustier decision. €375,000 fine, depending on the
had access to inside information on Mustier has always maintained verdict – due on 5 October.
potential subprime mortgage-relat- his own innocence, saying he sold
ed losses at the bank when he sold the shares on the basis of publicly Jean-Pierre Mustier
6,000 SocGen shares in late 2007, available information. has been fined
though it said the shares were a In a separate statement, the AMF
tiny part of the whole portfolio he said its sanctions committee had
€100,000 for insider
offloaded. cleared rival bank Natixis in a trading while he was
It said he used his banking probe over alleged misrepresenta- at Societe Generale
knowledge, particularly of collater- tion of financial losses in 2008.
The Capitalist
10 CITYA.M. 1 JULY 2010
EDITED BY
JULIET SAMUEL
GOT A STORY? EMAIL
thecapitalist@cityam.com

INSURERS STRAP IN FOR BLUNT’S


MILE-HIGH RECORD-BREAKING GIG
EVER wanted to watch James Blunt attendees into a Boeing 767 to watch into the groove a little tricky and cer-
sing his heart out – live – at 42,000 the blue-eyed singer serenade them tain RSA marketing types were heard
feet? No, neither have we, but let’s not for a 20-minute gig as they soared to admit that: “It’s not the sort of
diminish Royal Sun Alliance’s (RSA) around the skies over the North Sea. thing that’s usually on my playlist at
achievement in breaking the The audience, made up of some of home”.
Guinness World Record for the RSA’s top insurance salespeople plus Still, they were proud to boast that
world’s highest altitude live music a gaggle of giddy Heart FM competi- for the firm’s 310th birthday, they are
show. tion-winners – and, of course, The hatching a plan to hire out Sir
The insurance group has kicked off Capitalist, went along for the ride. Richard Branson’s space shuttle for
its 300th anniversary celebrations Blunt was allowed to stand, but the the first pop gig in orbit. Rumoured
with gusto by bundling 190 lucky audience’s seat belts made getting performers include Robbie Williams.

Blunt entertained Royal Sun Alliance staff 42,000ft above the North Sea

BORIS LIGHTS A FIRE LITERATI WEEK


Mayor Boris Johnson is clearly working The Southbank Centre has opened up
hard for London. After jetting back the London Literature Festival 2010
from his World Cup sojourn in South after a launch party where London
Africa, where he learned to play the literati defended their honour in a sci-
vuvuzela and enjoyed many a game ences-versus-arts football game. The fes-
from exciting environs of various stadi- tival runs until 18 July and will this
um stands, he is today going to be week feature controversial cultural crit-
lighting up fires all over town – well, ic Slavoj Zizek – famous in part for his
torches at least. Boris will this morn- insightful but relentlessly sexual
ing set alight the torch of the Balfour Freudian interpretations of films – in
Beatty London Youth Games, in which conversation with philosopher
Anthony Clifford Grayling. Also this
week Whitbread-winning writer
Jeanette Winterson will give the
Southbank lecture, while Lovely Bones
author Barbara Kingsolver will give a
reading and answer questions just
before the festival’s end.

BEWARE iCLARE
Clare Spottiswoode, scourge of dodgy
business practices, has enlisted a new
ally in her job as part of John Vickers’
banking commission team tasked with
On a bicycle made for three determining whether to break up large
banks. The hard-line former policyhold-
9,000 London kids will compete for the er advocate who took on Aviva is one of
Jubilee Trophy. The games are happen- 3m worldwide owners of Apple’s brand
ing as part of a fitness promotion cam- new iPad, which launched just 80 days
paign that comes at a modest cost of ago. The tech-savvy Spottiswoode
£30m (were a few public TV screens for reportedly carries her thoughts with
the World Cup really too much to ask?) her on organised PowerPoint slides on
and kicks off a long weekend of sports. the device. With the iPad up her sleeve,
Meanwhile, Boris has also been busy don’t be surprised to see her take on
gearing up on a bicycle made for three recalcitrant bankers while on the move.
as he cut the ribbon to open London’s Watch out!
400th Travelodge. This puts the num-
ber of local Travelodge locations on a
par with the number of bike-hire sta-
tions to be rolled out across the capital
in Boris’ cycle-renting scheme.

STEAMY NERDS LOSE


There’s no rest for the wicked, as
Ryanair is determined to prove. First,
CEO Michael O’Leary grabbed attention
at a colourful press conference this
week, in which he won a bet by wearing
a Germany football shirt and offered to
undercut Fabio Capello by accepting a
£4m salary and “picking a team that’s A Tracey Emin work up for grabs
just as shit”. Now, we hear, Ryanair is
launching a Europe-wide search for its
sexiest female crew-members after
50,000 passengers voted that they
LONDON CALLING
Don’t miss an opportunity to pick up
should star in the firm’s 2011 charity works by some of modern Britain’s best
calendar, which raises €100,000 each artists and musicians this evening as
year. More than half of those polled The Idea Generation Gallery hosts a
voted that “sexy female crew” should party to conclude a silent auction run-
front the project, while 18 per cent ning now in aid of the Ray Lowry
picked “sex passengers”, 17 per cent Foundation, a charity set up by the satir-
opted for “sex male pilots” and, in last ical cartoonist. Many of Lowry’s beauti-
place at 8 per cent, came the “steamy ful works are on sale, originally drawn
nerds in the Volcanic Ash Advisory for Private Eye and Punch Magazine.
Centre”. The Capitalist is only disap- You can also bid on works by Mick Jones
pointed to see that sexy male stewards (lead guitarist of The Clash) and Tracey
and hot female pilots were not on the Emin.
billing – but hey, there’s always 2012. Victoria Bates is away.
CITYA.M. 1 JULY 2010 News 11

Johnson cleans up
Jarvis PFI deals
contracts under licence. The deal will


SUPPORT SERVICES
BY MARION DAKERS cost Johnson a total of £3m.
The contracts are to provide servic-
THE PARENT company of Johnsons es including catering, cleaning and
Dry Cleaning has bought eight con- maintenance, for specific schools,
tracts from defunct rail maintenance hospitals and local authorities. The
Managing firm Jarvis, including three Public work currently involves 160 staff and
partner Wim Finance Initiative jobs. turned over £6.5m last year.
Dejonghe (l) and Johnson Services took over the Johnson also said in a trading
senior partner three PFI deals, and agreed with update that sales for the first half of
David Morley (r) Jarvis’ administrators to manage the year have dropped by five per
another five facilities management cent, due to severe winter weather.

A&O bullish as
profit up 10pc
despite slump
chief executive and chairman Dick

LEGAL
BY EMMA SADOWSKI Fuld in New York court proceedings
arising from the bank’s bankruptcy,
ALLEN & OVERY (A&O) is the first of advising the creditors on the Dubai
the UK’s largest law firms to reveal World restructuring and recently
financial results, posting a four per advising on Ocado’s initial public
cent decline in turnover and a 10 per offering.
cent hike in profits. Partners at the law firm celebrated
The “magic circle” law firm saw a 10 per cent hike in profits per equity
revenue for the year ending 30 April partner, which rose this year to £1.1m
fall to £1.05bn from £1.09bn it posted from £1m.
the previous year. Dejonghe said: “Our partners and
Senior management at A&O told staff have already risen to the chal-
City A.M. that the fall in revenue had lenge of adapting to our clients’
been expected as the markets contin- changing needs in uncertain and dif-
ue to struggle. ficult times.”
“This is still good news for us. We It is thought that the remainder of
expected a drop in volume because the magic circle law firms, which are
the markets are down. We did an expected to report financial results
analysis of the markets that we oper- next week, are likely to fall in line
ate in and have invested accordingly,” with A&O.
said managing partner Wim Dejonghe remains confident about
Dejonghe. the year ahead.
He said that up to 60 per cent of He said: “While the outlook for the
A&O’s revenues derived from regions global economy remains uncertain
outside of London, reflecting the we are in the best possible shape to
firm’s decision to move into areas handle whatever challenges the mar-
such as Qatar, Sydney, Perth and ket presents.”
Jakarta this year. Last year, A&O restructured its busi-
The firm also landed a raft of large ness, which saw partner, fee earner
instructions this year, including rep- and support staff headcount reduced
resenting former Lehman Brothers by nine per cent.

Increase
in profits per equity Revenues down 4% to:
partner up 10% to:

£1.1m £1.05bn
FINANCIAL RESULTS

60%
of revenues from
New offices in
Qatar, Sydney,
Perth and
outside of the UK Jakarta
12 News CITYA.M. 1 JULY 2010

Corporate events are valuable if chosen well


short of filling their capacity. The lack cises during the boom years? up by a pair of former Royal Air Force the practice day for the Biggin Hill air
of interest for corporate hospitality Those that provided run of the pilots and offers some of the best hos- show. From my perch in the middle of
packages is partly to blame. mill “jollies” are likely to continue pitality and corporate events going. the formation it was easy to see how
Meanwhile, back home there are struggling. Highlight of any trip to their 2Excel use their military heritage,
fewer invitations doing the rounds to Instead, institutions Northamptonshire base is an aerobatic expert pilot skills and dramatic forma-
much of the traditional “season” of are looking for some- ride in one of the firm’s Extra 300 tion flying to provide a shared experi-
summer sporting occasions. Expenses thing that is truly light aircraft, flown by an ence for participants than engenders
budgets have been slashed at leading unique, unforgettable expert ex-RAF pilot. This is not qualities including trust, teamwork
CITY COMMENT investment banks, leaving serious and produces tangi- just any joyride, however. and leadership. It’s a far cry from
BEN GRIFFITHS question marks over an industry
worth £1.5bn a year. Institutions are
ble results.
Frequently this trend
2Excel’s other business is tak-
ing four of the Extras on the
quaffing champagne in yet another
bland hospitality marquee and clearly
being forced to cut back their budgets, towards niche events needs road for air shows where its packs more punch per pound invested.

D
URING these dark times of aus- as much to protect themselves against now not to encroach on busi- aerobatic team of former Red Those corporate events providers
terity and bank bashing, those accusations of excess as to actually ness hours but still manage to lure in Arrows, The Blades, performs an like 2Excel who can come up with
halcyon days of lavish corporate rein in spending on non-essential serv- potential clients and contacts. amazing routine in close forma- such unforgettable experiences that
hospitality have come to seem ices and offsite days. One events and experiences compa- tion – sometimes just feet apart. leave guests grinning for days after-
like a long time ago. It has been notice- So what now for the companies that ny that was launched ahead of the I was lucky enough to experi- wards are odds on to ride out the cur-
able watching the Word Cup in South were set up to cater for corporate hos- recession but continues to thrive is ence this for myself last week, rent economic turbulence in style.
Africa that the stadiums often fall pitality, events and team bonding exer- 2Excel Aviation. The company was set flying with The Blades during ben.griffiths@cityam.com

RWC ramps
Still no deal up senior
for miners on hiring spree
Aussie tax bill


MINING
FUND boutique RWC Partners has con-
tinued its high profile push into more
mainstream business with two senior
fund manager hires from larger rival
Rio Tinto’s chief executive Sam Threadneedle.

MINING
BY MARION DAKERS Walsh told reporters he was “very The London-based firm yesterday
hopeful of a quick resolution”. said it had hired Peter Allwright and
A SECOND day of intense negotiations “If a deal is put together, we’ve got From top left (clockwise): Ian Lance and Nick Purves joined Stuart Frost to take over the $70m
has stopped short of producing a deal to have the assurance that it will carry from Schroders and Stuart Frost and Peter Allwright have (£46.8m) RWC Strategic Reserve fund
between mining companies and the through post the election if the gov- joined from Threadneedle and launch two new funds later in the
new Australian administration for a ernment is re-elected,” he said. year as they build a fixed income
resources super profit tax. Gillard, who became Prime absolute return business.
The country’s new deputy Prime Minister last Thursday after ousting The hires follow the recruitment of
Minister Wayne Swan said he and Kevin Rudd, told the Australian media top-performers Nick Purves and Ian
finance minister Martin Ferguson yesterday: “I have been pleased by the Lance from Schroders in May to run an
were preparing to continue into a constructive and disciplined approach income fund. Soon afterwards,
third day of talks with mining compa- that is being taken by both sides.” Schroders bought a 49 per cent stake
nies. Gillard has made a deal on the con- in RWC. RWC said that while the
“We will continue to do that as we troversial tax a priority since replac- Strategic Reserve fund targets returns
go through the rest of the week. We ing Rudd, whose failure to reach a of three per cent over cash, the new
are not into megaphone diplomacy compromise played a part in his vehicles to be launched by the ex-
here. We are sitting down in good downfall, and is expected to call an Threadneedle pair will have higher tar-
faith discussing matters with a wide election shortly after sewing up an gets and will be free to adopt less
range of people,” he said yesterday. agreement with the miners. cautious strategies.
The talks are understood to include Mining shares were the main drag At Threadneedle, Allwright and
Rio Tinto, BHP Billiton and Xstrata, on a largely flat FTSE yesterday. Frost managed Absolute Return bond
the most vocal critics of the proposed portfolios with assets of more than
introduction of a 40 per cent New Australian Prime $3bn. They were also co-managers on
resources super tax on miners. Minister Julia Gillard is the Target Return Fund.
Mining industry groups suspended RWC is a fund management min-
a hostile advertising campaign against determined to strike a now compared with the rivals from
the tax last week after Julia Gillard deal with miners over which it has poached staff. It has $2bn
promised to negotiate with the indus- a super profit tax in assets while Schroders has $168bn
try. and Threadneedle around $64bn.

Threadneedle Communications merges Polo goes it alone as it


with fellow public relations firm Icis sells its Mongolian unit
services, financial services and prop- Threadneedle can draw from their maximising shareholder value

PUBLIC RELATIONS

MINING
BY STEVE DINNEEN erty, natural resources and energy. experience to add further value to through its interests in Extract, GCM
Icis is an established player in the our clients.” AIM-LISTED miner Polo Resources has and Caledon Resources.”
TWO major City PR firms yesterday smaller companies arena that has Tom Moriarty, Icis chief executive, finalised the sale of its coal and urani- The firm will receive a one per cent
announced they will merge their provided a specialist service to com- said: “By merging with um joint venture in Mongolia, just royalty on coal sold from licences cur-
operations. panies in the technology, media and Threadneedle we are creating a lead- days after pulling out of a merger rently held in the joint venture,
Threadneedle Communications, a telecoms sectors. ing force in the growth companies with Australian peer Caledon citing capped at £50m.
small companies consultancy and It has been led by founder Tom arena. volatile market conditions. Polo announced last week that it
Icis, a specialist technology PR firm, Moriarty since it was formed in 1999. “Threadneedle has done an excel- Polo has sold its stake in the ven- would no longer be making an offer
will now both operate under the Graham Herring, chief executive lent job in establishing itself as a ture to China-based miner Winsway to coal producer Caledon, but pur-
Threadneedle umbrella. of Threadneedle, said, “We’re very highly respected consultancy and for $35m (£23.4m), after buying in chased 11m new shares in the firm
Threadneedle provides investor excited to be joining forces with grown very successfully over a short May 2009 for $25.8m (£17.2m). and said it “remains a fully support-
and media relations services to grow- Icis. Tom and his team have estab- period of time. Both myself and the Co-chairman Neil Herbert said: ive shareholder”. The deal was
ing companies and has a strong pres- lished a strong reputation in the rest of the team at ICIS look forward “We are pleased to have completed approved by Caledon shareholders at
ence in business and support technology sector and we believe to working with them.” the divestment. Polo is focused on yesterday’s annual general meeting.
CITYA.M. 1 JULY 2010 Economic News 13

Business investment growth


boosts hope of GDP increase
down on a year earlier. The construc- The GDP figures should have been


ECONOMY
tion industry also experienced an released yesterday but the Office for
BUSINESS investment growth in the impressive spike of 36.5 per cent. National Statistics announced poten-
UK in the first three months of 2010 Manufacturing investment stabilised, tial errors in the dataset had forced it
has been revised upwards to 7.8 per ending the sharp decline that the sec- to postpone publication.
cent on the previous quarter, official tor suffered in 2009. Despite the growth in business
data showed yesterday. IHS Global Insight’s Howard Archer investment, Archer said this followed
Encouragingly, the annual decline said: “The upwardly-revised perform- contraction in seven of the previous
in business investment was conse- ance boosts hopes that overall GDP eight quarters, adding it seemed unre-
quently trimmed to 7.7 per cent from growth could be revised up from the alistic to expect investment to surge
the previous estimate of 11 per cent. currently reported rate of 0.3 per cent over coming months given the appre-
Service sector investment jumped quarter-on-quarter when the delayed ciable excess capacity, limited final
Policymaker Adam Posen says the UK could dip into recession again Picture: GETTY 11.1 per cent on the previous quarter, national accounts data are finally demand and uncertainty about the
although it is still some eight per cent released on 12 July.” longer-term strength of the recovery.

MPC’s Posen Ireland led out of recession by exports


says UK not ceding quarter, above analysts’ medi- Preliminary data had earlier indi-

EU ECONOMY
an forecast for one per cent growth. cated Ireland was back in growth in
IRELAND has finally quit the Exports were the key factor, rising the third quarter of 2009 but the
Eurozone’s longest-running recession 6.9 per cent in the first quarter – the Central Statistics Office later revised
in the first quarter, led to growth by second strongest quarter for exports the numbers to show continued con-

out of woods
strong exports. on record. traction throughout last year.
Gross domestic product The latest data marked the first An International Monetary Fund
(GDP) rose 2.7 per cent in positive change in GDP versus report last week said Ireland’s return
the first quarter the previous quarter to growth was likely to be more grad-
from the since the ual than anticipated by the govern-
pre- f i n a l ment, which could derail its
quar ter much-vaunted fiscal reforms.
of 2007. The government hopes to return to
ECONOMY

emergency monetary stimulus had a general deficit of below three per


BY JESSICA MEAD helped to create a “mild upward creep cent of GDP by the end of 2014.
in inflation expectations”.
THE UK economy is still teetering on a But he said he was not fully confi-
knife edge between continued recov- dent that the UK economy would NEWS | IN BRIEF
ery and the renewal of a severe reces- continue to recover, indicating
sion if not outright deflation, warned that he is not about to join fellow-
Bank of England policymaker Adam MPC member Andrew Sentance German unemployment falls
Posen. in calling for rate hikes. German unemployment fell for the 12th
Speaking yesterday in London, the consecutive month in June thanks to an
Monetary Policy Committee (MPC) improvement in business confidence
member said that Britain was caught which gave the recovery in Europe’s
between the strong recovery outside largest economy a helping hand.
of Western Europe and the coming In seasonally-adjusted terms, the num-
austerity at home and in the Euro ber of jobless fell by 21,000 taking the
Area. unemployment rate to 7.7 per cent.
“If we are fortunate, our present Officially, 3.23m Germans are out of
monetary policy stance combined work, the lowest since December
with the UK economy’s natural ten- 2008. On an unadjusted basis,
dency to recover and with sus- unemployment fell by 81,000 to
tained global growth outside of 3.15m.
Europe will be sufficient to get
the UK to the good outcome.” London home prices up the most
This would result in more London and the South West have had
inflation overshooting in the the strongest growth in house prices,
interim, said Posen, adding according to a Nationwide Building
that in that state of affairs he Society report. Second quarter London
would be “only too happy to prices were up 13.2 per cent on a year
vote for an interest rate earlier. South West houses are up three
increase”. He said per cent and UK prices up 1.9 per cent.
that the

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14 News CITYA.M. 1 JULY 2010

Portugal vetoes PT Vivo sale Northgate profits rise 33


holder assembly to decide on the sale new meeting of the board of directors
per cent after cost cuts

TELECOMS
of Vivo and “considered that there to consider the sale of Vivo to
BY HARRY BANKS are some legal matters that require Telefonica.
PORTUGAL TELECOM said yesterday clarification and, as a result, will be It said this meeting would take into firm aims for 90 per cent utilisation


TRANSPORT
it will seek legal clarification on a obtaining legal opinions.” account the fact that Telefonica had overall, “and if we need to further
decision by the government to veto Shareholders voted by 74 per cent extended the Vivo offer until 16 July. VAN HIRE firm Northgate said under- reduce the fleet so be it”.
the sale of its stake in Brazilian in favour of the sale of Vivo versus 26 Telefonica said late Wednesday lying pre-tax profits rose 33 per cent During the year the firm has
mobile phone company Vivo against against, but the government invoked that it would extend the offer and to a better than expected £36.5m last reduced net debt by £288m to £598m,
the wishes of shareholders. its golden share at the meeting, veto- that it considered the Portuguese gov- year, after a restructuring of its UK mainly as a result of a rights issue in
Portugal’s socialist government ing the sale and overriding the wish- ernment’s veto illegal. and Spanish businesses. January. The company said it has
surprised analysts and markets yester- es of shareholders. Two leading Portuguese PT share- The County Durham-based compa- secured its debt structure until 2012.
day by invoking its so-called golden The chairman of yesterday’s share- holders added their weight to the ny downsized its fleet of commercial The firm also noted that bad debts
share in PT and vetoing the sale of holder assembly decided the govern- fight, saying they voted to sell Vivo at vehicles by 13,500 and shed 130 staff on its books from Spain had risen to
PT’s stake in Vivo to Spain’s telecoms ment’s use of the golden share was the shareholder meeting, changing to adjust to slower sales. Its UK branch €10.3m, up from €3.7m the previous
giant Telefonica for €7.15bn (£5.9bn). legal. their opposition to the sale after had a 91 per cent utilisation rate last year.
PT said in a statement that its PT said that once it has heard legal Telefonica raised the offer price by 10 year. Shares jumped 14 per cent to
board of directors met after a share- experts on the matter it would hold a per cent on Tuesday. Chairman Bob Mackenzie said the 173.5p yesterday.

Morgan Stan BEST OF THE BROKERS


ANALYSIS l Lloyds Banking Group
75 p
53.80
ANALYSIS l Resolution
90 p

85 63.30
ANALYSIS l Daimler
44 €
41.92
30 Jun

is top in global
70 30 Jun 42
80
30 Jun
65
40
75
60
70 38
55
65
36

IPO rankings
50 60

45 55 34
29 Mar 21 Apr 12 May 2 Jun 22 Jun 29 Mar 21 Apr 12 May 2 Jun 22 Jun 21 Apr 11 May 31 May 18 Jun

LLOYDS BANKING GROUP RESOLUTION DAIMLER


Credit Suisse has given Lloyds Banking Citigroup has cut its price target for JP Morgan Cazenove maintains an “over-
six of the ten largest deals. Group an “outperform” rating. It upgraded Resolution to 87p from 121p to reflect the weight” rating for Daimler for a few rea-

FINANCIAL SERVICES forecasts for the bank last month after value dilution and deal execution risks. Citi, sons. It says street estimates look about 10
Japan’s $11.16bn Dai-ichi Life
BY HARRY BANKS
Insurance and South Korea’s $4.41bn flagging that sustained low interest rates which has given Resolution a “buy” rating per cent too low, a weaker Mercedes prod-
MORGAN Stanley has topped the Samsung Life Insurance were the would allow for a £4bn increase in mort- however has raised its estimates to reflect uct cycle in 2011 should not derail group
underwriting league for initial public largest IPOs.
offerings (IPOs) in the first half of the Fears that Europe’s debt crisis
gage revenues over the next three years. market movements and the latest earnings before interest, taxes margin
year. could spread have increased market Base rate expectations have since fallen to announcement that Resolution has agreed momentum is strong and valuation remains
A few large deals helped propel the volatility and weighed on new issues, record lows, notes Credit Suisse. to purchase part of AXA’s UK life unit. compelling.
Wall Street bank to first place, up scaring some investors away from
from its number three spot at this smaller, less liquid flotations. Many
time last year. IPOs were pulled during the quarter To appear in Best of the Brokers email your research to notes@cityam.com
It underwrote 36 deals with esti- due to these fears. Large offerings,

Costain posts performance in line with


mated proceeds of $5.9bn (£3.9bn) in however, were able to plod along.
the first six months, more than eight While IPO league table status does
times what it hauled in from the not track how the stocks perform in
deals a year earlier, according to the aftermarket, they give bragging

expectations with a strong order book


Thomson Reuters data. rights to the banks and bankers
The bank had a joint-bookrunning involved and show which banks are
role on the second largest IPO of the doing good business.
year, South Korea’s $4.41bn Samsung China, whose stocks are among the
Life. It also worked on IPOs of worst performers globally so far in
Poland’s top insurance group PZU, 2010, took three of the top 10 global
Spain’s travel reservations firm spots as IPO underwriters. That The group also announced it has The group said it had recently

CONSTRUCTION
Amadeus IT Holding and Brazilian excludes the July IPO of the preferred bidder positions on con- merged its environment and commu-
shipbuilding and oil services compa- Agricultural Bank of China, which ENGINEERING group Costain said its tracts worth over £500m, in a move to nity activities into a single division.
ny OSX Brasil. aims to raise up to $24.5bn including trading is line with expectations in soothe shareholders concerned about It has maintained a strong net cash
JPMorgan, the former number one, overallotments, making it the largest an update yesterday, and that the spending cuts in large public sector position of more than £100m this
was in second place with 40 deals IPO ever if it hits that target. firm has made a significant number projects. year, with no significant debts. It will
totalling $5.65bn. Goldman Sachs Among the Chinese deals were of new contracts since the start of the In recent years the group has publish its full results for the half
slipped one spot to third place, on 31 Huatai Securities, fetching $2.3bn year. worked on UK infrastructure projects year in August.
deals totalling $5.1 bn. and China First Heavy Industries, the The firm said it has a forward order such as St Pancras train station, the Shares closed one per cent down at
Much of the IPO activity in the first mainland’s biggest heavy equipment book of £2.5bn, with around £1bn channel tunnel and Sellafield 200p, against an overall rise of 0.92
half came from Asia, accounting for maker, raising $1.7bn. worth of work secured for 2010. nuclear plant. per cent in the FTSE All-Share Index.

URS wins battle for Scott Wilson as NEWS | IN BRIEF

trumps CH2M with a £223m offer Pensions Regulator’s first notice WTO slams EU aid for Airbus
The Pensions Regulator has issued its The World Trade Organisation judges
first contribution notice against a gave the European Union a stinging
European company, ordering Belgium- rebuke yesterday, saying the EU must axe
based weaving machine maker Michel prohibited export subsidies to plane-
Van De Wiele (VDW) to make good a gap maker Airbus which had injured US rival
Crossrail train line. CH2M, which yes- did not expect any growth in its UK in the pension scheme of a UK subsidiary Boeing. The WTO panel concluded Airbus

TELECOMS
terday withdrew its bid, offered business over the next year. it claimed had been liquidated to avoid had been able to launch a series of pas-
ENGINEERING giant URS said yester- £189m on 28 June, hours after Scott Its shares closed on Wednesday up maintaining the fund. The group tried to senger jets only thanks to subsidies from
day it was offering 290p in cash for Wilson accepted a £161m bid from 1.9 per cent at a 2-1/2 year high of dodge its liability by putting the British the EU and member states Britain,
each Scott Wilson share, 18 per cent San Francisco-based URS. 266p. subsidiary, Bonas, into a “pre-pack” insol- France, Germany and Spain, without
higher than Tuesday’s bid of 245p URS’s new offer is also 233 per cent DC Advisory Partners and Citi are vency then buying it back without the which it would be a very different and
from Colorado-headquartered CH2M above Scott Wilson’s closing share financial advisers to URS. Cooley LLP deficit-laden pension scheme, according much weaker company. The ruling marks
and 38 per cent above its original price on 4 June, the last business day and Ashurst LLP are URS’s legal coun- to the regulatory panel’s description of a big setback for Airbus, but is not the
offer of 210p on Monday. before it announced that it had sel. Greenhill & Co and Brewin the case. The case is the first time the end of its battle – the world’s largest and
The move, valuing the company at received takeover approaches. Dolphin are advising Scott Wilson, regulator has used a contribution notice, costliest trade dispute – with Boeing
approximately £223m, ends a bidding London-based Scott Wilson, which with legal advice from Mayer Brown. which requires a specified amount of over subsidies in the market for large
war for Basingstoke-based Scott employs 5,500 people globally, said CH2M is Scott Wilson’s largest money to be paid into a pension scheme civil aircraft worth $3 trillion over the
Wilson, an engineering adviser on Monday it had almost doubled its shareholder after buying just under where there is an attempt to avoid liabili- next 20 years. “These subsidies have
whose projects include London’s full-year pretax profit to £18m, but 10m shares on Monday. ties. VDW is appealing the case. greatly harmed the US,” the WTO said.
CITYA.M. 1 JULY 2010 Consumer News 15

HMV looks forward NEWS | IN BRIEF


Kraft veteran joins Premier

to happy Christmas
Premier Foods has appointed former
Kraft executive Ronnie Bell to become
its new chairman. Bell, who spent 30-
years at the US group, replaces David
Kappler, who has been chairman since

after profits pick up


2004. Bell is currently a non-executive
board member at Northern Foods, but
will step down to take up the Premier
role in October. Charles Miller Smith, the
former ICI chairman will also take over
as deputy chairman at the same time.
Chief executive at Premier Robert
RETAIL ings growth by increasing sales of new Schofield, said: “Ronnie has had a long

BY JOHN DUNNE products and raising its presence in and successful career in the food indus-
live music and ticketing. try and brings with him a wealth of
HMV met forecasts with an 18 per cent Group sales rose 3.1 per cent to experience. I look forward to working
rise in yearly profit and said its plan to £2.02bn. However, sales at HMV UK with him as we focus on delivering
transform the business into an enter- and Ireland stores open over a year HMV’s annual results (below) suggest it is on the comeback trail Picture: GETTY organic growth and reducing debt.”
tainment brand was working. were down 2.4 per cent, while like-for-
The music, games and DVD group, like sales at Waterstone’s fell 6.2 per Former Hobbs boss dies

18% £74.2m 400


which runs over 400 stores under its cent. Former Hobbs chief executive Nick
own name as well as 314 Waterstone’s Chief executive Simon Fox said: Samuel has died after a short illness at
bookstores, made an underlying pre- “Our strategy is on track but it will be the age of 58. Samuel guided the retail-
tax profit of £74.2m for the year to 24 the Christmas period when we prove rise in profit Underlying pre-tax profit the number of er between 2002 and 2008 and
April. The group said that Christmas that. There are doubters out there but stores under the remained on the board of the company
would be the stage at which the com- I do believe our share price – up 6p at HMV name until last year. The businessman also sat
pany’s turnaround would be proven 63p – is dramatically undervalued.” on the board of Adili, N.Peal and was a
beyond doubt for potential investors. non-executive director at Blacks. He was

3.1% 6.2%
HMV faces the same competition Chief executive Simon well known in the retail industry and ran
from supermarkets, online retailers the marathon for the Retail Trust.
and digital downloading that caused Fox says HMV’s shares Tim Danaher of Retail Week said: “Nick
rivals Woolworths, Zavvi and Borders are undervalued and is Samuel was one of the nicest guys in the
UK to fall during the recession. confident that its rise in group sales fall in like-for-like sales fashion world, and highly successful in
It has responded by cutting costs strategy is on track at Waterstone's turning Hobbs from a small family-run
and widening its focus, targeting earn- affair to a major fashion brand.”

Tesco’s accounting
methods in spolight London
Night Hike
RETAIL figure of 31.7p. back deal, which will be issued via Friday 17 September 2010

BY JOHN DUNNE Johnston also said: “As we argue in Tesco Property Finance 3. Moody’s has
this report, the profit and loss Tesco estimated the market value of the
TESCO yesterday saw its shares dip presents to analysts, owners and portfolio at £853.1m.
after Citigroup accused it of “consis- potential owners of the business is Yesterday Tesco’s share price
tently aggressive” accounting. increasingly divorced from its opera- dropped 2.51 per cent to 380.05p.
Britain’s biggest grocery chain is tional realities, we think.”
using a different method from its In a separate report the Advertising ANALYSIS l Tesco
rivals on everything from depreciation Standards Authority found that a 460 p
to pensions, an analyst claimed. Tesco media campaign claiming that 382.80
Citigroup’s Alastair Johnston said: certain ranges were cheaper than Asda 440 30 Jun
“If we put Tesco on more comparable had been “ambiguous and mislead-
accounting to other companies in our ing”.
420
sector, it appears to be a much less Meanwhile it was also revealed yes-
profitable entity.” terday that Tesco plans to sell a 30-year
Citigroup’s alternative earnings per benchmark sterling bond backed by 400
share for the chain, using a similar rents generated by a portfolio of its
model to its peers, is 24.2p for the last supermarkets. HSBC and Goldman 380
financial year, as opposed to Tesco’s Sachs are managing the sale and lease- 29 Mar 20 Apr 11 May 1 Jun 21 Jun

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LEISURE Its box office market share rose to Cineworld did not give actual fig-

BY JOHN DUNNE 24.3 per cent in the 26 weeks to 1 July, ures for its revenue performance.
from 23.5 per cent the same time last Earlier this month, the group
BRITISH cinema chain Cineworld year, helped by the popularity of 3D announced a partnership with Arts
believes new 3D films from popular films Avatar and Alice in Wonderland, Alliance Media to roll out digital pro- www.maggiescentres.org/nighthike
franchises like Shrek, Toy Story and and sequels Iron Man 2 and Sex and jectors across its cinemas within the
Harry Potter will help it attract audi- the City 2. next three years, which it believes will Register today or call 0300 123 1801
ences after a downturn triggered by But retail revenues fell 3.2 per cent, enable it to capitalise on the trend
the World Cup. reflecting a “challenging consumer towards 3D films.
Cineworld, which runs 78 mainly environment” as cinema goers “This strong line up of films
multiplex cinemas, said revenues rose worried about higher taxes and public together with our performance to date
3.7 per cent in the first half of its finan- spending cuts. This was offset, howev- underpins our confidence in the over-
cial year, even though the world’s er, by a 31.4 per cent jump in “other all outlook for the year,” Cineworld
biggest football tournament, in South income” from screen advertising, said in statement.” Maggie Keswick Jencks Cancer Caring Centres Trust
(Maggie’s) is a registered charity, No. SC024414 A partnership between Maggie’s and Open City
Africa, was dragging potential filmgo- booking fees, screen hires, games Upcoming 3D releases include
ers away from the big screen. machines and 3D glasses. Shrek Forever After.
16 News CITYA.M. 1 JULY 2010

Auditors must learn to articulate their value


(FSA) and Financial Reporting Council work that supports auditing have gen- form their duties more efficiently and that more needs to be done to explain
have set out their thoughts on the audi- erally held up well in the crisis. effectively. We have already seen the value of audits to those outside the
tors’ role and the contribution they However, questions have been asked improvements in both the frequency audit process. Making more informa-
could make to prudential regulation in including by the House of Commons and quality of such dialogue but I’m tion available about discussions
a consultation paper published yester- Treasury Select Committee about the sure it can be improved further. As the between auditors and banks could
day. The document highlights a num- value of bank audits against an expec- FSA has also identified, there is scope increase the value placed on audit and
ber of challenges for the auditing tation that auditing should have pro- for making greater use of external thereby increase market confidence.
profession. It also sets out how auditors vided some forewarning of the experts on a thematic basis, as part of With any crisis comes change. Over
GUEST COMMENT can play a stronger role in the regulato- banking crisis. the overall monitoring regime. the coming months, there will be
MICHAEL IZZA ry oversight of banks within the frame-
work that is being developed in this EVOLVING THE AUDIT MODEL
Auditors can help give greater confi-
dence in bank reporting. They could
much discussion about these and the
other proposals set out by the FSA. I
post-banking crisis world. As a result of the crisis, we have had to provide assurance on summary risk have no doubt that these will play a sig-

I
F THERE is to be a positive legacy of Auditors play an important role in think about how the audit model reports which will enable investors to nificant role in shaping the future of
the financial crisis, it must be in the financial markets, promoting confi- needs to evolve to meet the needs of better understand key risk informa- audit and ensuring the expertise and
lessons that market participants dence in financial information provid- regulators, investors, management and tion. They should also have more professional judgement of the auditor
have learned from extremely chal- ed by banks and other financial society as a whole. involvement in reporting on the front continues to be valued.
lenging times. Bank auditors have been institutions and acting as a discipline For example, regular exchange of sections of annual reports. Michael Izza is chief executive of the
no exception. for directors and management. information between auditors and the However, if there is one big lesson Institute of Chartered Accountants in
The Financial Services Authority Auditing and the regulatory frame- bank supervisor enables both to per- from the crisis for auditors, it may be England and Wales.

Accountants
The FSA is calling
for auditors to
have greater legal
obligations to
financial
regulators.

back report Paul Sharma, the FSA’s

by regulators
prudential policy
director, is heading the
probe into auditing
practices

The FSA and FRC say auditors should expand their AUDITOR VIEWS: WHAT IS YOUR REACTION TO THE JOINT FSA AND
audit model, Emma Sadowski reports on the debate FRC REPORT ON THE ROLE OF THE AUDITOR? Interviews by Emma Sadowski

ACCOUNTANTS say they are willing more regular meetings and dialogue GRAHAM CLAYWORTH | BDO


to consider whether the current with the audit profession,” said a
audit model needs to evolve to meet spokesperson from E&Y.
changing market needs, following a The sentiment is echoed amongst We welcome the healthy contribution to the debate. What does need to happen is for audi-


recent report by the Financial the accounting profession, which tors, regulators, corporates and investment bodies to sit down and say ‘how do we go forward?’ and
Services Authority (FSA) saying that said that regular meetings with regu-
the profession had not been sceptical lators should be a necessity. this is why I think this report is helpful.
enough about the financial firms it But suggestions in the report that
audited in the run up to the banking auditors face legal obligations to the RICHARD SEXTON | PRICEWATERHOUSECOOPERS


crisis. FSA have some accountants question-
The City regulator, in a discussion ing why the financial watchdog
paper published with the Financial should play a larger role.
Reporting Council setting out the “The FRC is responsible for account-
The audit is critical to the proper functioning of the capital markets and we are pleased that


case to give it the powers to publicly ing standards, so why should auditors this view is shared by the FSA and FRC. Their paper challenges many aspects of current auditing prac-
censure and fine auditors, has called face the FSA?” said Graham tices, as set down by the regulators and standard setters, including the role of the auditor.
on the auditing profession to demon- Clayworth at BDO.
strate that it had learned the errors of Meanwhile, the Institute for
its ways since the banking meltdown. Chartered Accountants of England JOHN GRIFFITH-JONES | KPMG


KPMG, Ernst & Young (E&Y), and Wales (ICAEW) notes that the
PricewaterhouseCoopers (PwC) and Treasury Select Committee conclud-
BDO say they weclome the debate. ed in a report last year that there was Let’s welcome the broader debate. But let’s take this opportunity to debate the role of audits


“We welcome the FSA’s engage- little evidence to suggest that audi- and auditors not in isolation but alongside the other participants in the line, focussing on what new or
ment in the future of audit debate tors failed in their duties in the run
and in particular their proposals for up to the crisis. improved part we can play in creating a far more robust system of total assurance.

CITY MOVES | WHO’S SWITCHING JOBS Edited by Marion Dakers

He replaces John Crewe who served as AIG real estate development, investment
CFA Institute chairman from 2005 having first joined The insurance giant has appointed for- and joint ventures. Solomon will be tak-
The Chartered Financial Analysts Institute has the board in 2004. Crewe, a former mer Lehman Brothers’ lawyer David ing over the London role from Cliff
appointed Edward Bace as head of education president of international marketing DeMuro as deputy general counsel, McAuley who retires at the end of the
for the EMEA region. He joins the institute from and development, global financial serv- overseeing global compliance and regu- year. McAuley, who heads up both the
BPP Business School, where he was professor ices group at American Express, will latory strategies. He will oversee AIG’s London and global practices, will work
of finance. He has over 20 years’ experience in stay on as a non-executive director. compliance and regulatory staff. The closely with Solomon over the next six
international finance, and has worked for firm has also appointed Karen Nelson months to ensure a smooth transition
Lehman Brothers, Standard & Poor’s and the Air Partner as chief compliance officer, a role she between the partners. An election for
European Bank for Reconstruction. He holds The private aviation firm has appointed has filled on a short-term basis since the global real estate role will take
the CFA designation and an MBA in finance Gavin Charles as chief financial officer January. place in the autumn.
and international business. with immediate effect. He has over 20
years’ experience in both UK and inter- Clifford Chance Jones Lang LaSalle
utive of Standard Chartered and former national finance, and was most recently The law firm announced yesterday that The real estate services firm has pro-
SAV Credit president and CEO of Visa finance director at Miele. Charles has Jonathan Solomon has been elected the moted 42 employees from across the
The credit card provider is preparing International. He is currently chairman also worked for Remington and new leader for its London real estate English business and England-based
itself for further expansion by hiring Sir at Clydesdale Bank and Friends Wellness Food, and originally qualified practice for a period of four years, from pan European and global business units
Malcolm Williamson as chairman. Sir Provident and is a non-executive direc- as a chartered accountant at Ernst and 1 May. He has been a partner at Clifford to the role of Associate Director, with
Malcolm is the former group chief exec- tor of National Australia Bank. Young. Chance since 2000 and specialises in effect from 1 July.

To appear in CITYMOVES please email your career updates and pictures to citymoves@cityam.com
BOB WIGLEY IS READY.ARE YOU?
Bob Wigley, Chair of Yell Group

Bob Wigley is ready to judge entries to the inaugural CITY A.M. Awards
– the new financial business awards from the UK’s leading, free,
business daily. And, like CITY A.M. itself, all entries are free to
companies, teams and individuals working in the financial business.
Entry is online and there are 15 company awards recognising
corporate excellence and 6 awards that celebrate the individual or
team stars of the financial community. Start thinking about your
entries and nominations now.
The deadline for entries is 22 July 2010
For full details and helpful contact points please visit
the Awards website: www.CityAMAwards.com
For information on becoming a sponsor of the City A.M. Awards
contact Harry Owen: 020 7015 1241/ harry.owen@cityam.com
And save this date for your diary: Thursday 28 October 2010
at Grange St Paul's Hotel, London EC4 for the Awards Dinner.

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in association with

official venue partner Awards reception sponsor category sponsors


Investment
18 CITYA.M. 1 JULY 2010

| Listed Products

Pick a moment
and hold on for
property gains
The short-term view the property ETF market in the UK, with
70 per cent of assets under management
is volatile but ETFs (AUM) in this area in iShare funds. They
have seen their property ETF AUM grow by
£395m since last autumn, with much of
will give you real the flow going into overall global and UK
funds. These ETFs target the property mar-
estate liquidity, ket by tracking a particular subset: the
FTSE index of real estate investment trusts
writes Juliet Samuel (Reit).
This distinguishes investing in a proper-
ty ETF from investing in real estate more

W
ITH the trajectory of the UK real generally, the most obvious difference
estate market far from clear, being that your exposure is to commer-
property investment might cial, rather than residential, property.
seem like a risky business. But Reits, however, are a specific subset of
many UK property-tracking exchange-trad- commercial property: Execution Noble
ed funds (ETF) have nonetheless seen points out that while the UK’s largest Reit,
steady asset inflows in the last year since Land Securities, has a portfolio worth Play the commercial than investors like Tesco for whom own- stimulus projects resulted in a rise of
prices began to recover in 2009. ETFs offer £9.5bn, the value of Tesco’s real estate property market for ing real estate is a side effect of its retail property prices, many property investors
exposure to property without the long- alone dwarves this at £34.6bn. So while long-term gains business. wanted to capitalise on this modest recov-
term commitment of buying the asset property ETFs don’t provide complete cov- Tracking Reits also offers the advantage ery. Direct property investment and many
directly, which, with so much uncertainty, erage of the market, they do offer the abil- Picture: GETTY of liquidity, which is attractive in such non-Reit property funds, however, do not
is proving popular. ity to track the biggest investors for whom uncertain times. For example, near the offer an easy way out: selling an office
iShares accounts for the lion’s share of property is their sole asset class rather end of 2009, after low interest rates and block can take a while and, at the begin-

IT’S THE HALF YEAR


BLUES, AND THERE IS China’s stock index
PLENTY OF RED INK
GEOFF WILKINSON
HEAD OF RESEARCH, MINT EQUITIES
is getting oversold
Opportunities exist for investors would still leave China as the main driver

A
ND so another quarter wends its way Yes, we can rally, even substantially from of the global economy. As Mark Williams
to a weary end. The simple fact is
that the S&P 500 is currently down
this level, but the specific conclusion is that
the highs for 2010 have already been posted, who still believe in its growth at Capital Economics says: “Year-on-year
growth will slow further, although this is
10 per cent on the quarter, which is
woeful enough, but supposedly buoyant
and we have the implicit potential to trade
substantially lower from here. story, writes Kathleen Brooks far from the hard landing that many
have warned of.”
China has fallen twice as much. Our money is After weak consumer confidence data Retail sales have slowed, but Williams
safely tucked away in a cash ISA yielding from the US on Tuesday, all eyes are now notes that they have held up well in nom-

I
0.003 per cent, so relatively speaking it fixed firmly on Friday’s non-farm payrolls fig- NVESTORS barely had time to digest A revaluation of the inal terms. He also remains unconcerned
could clearly have been worse. We have no ure. With the market already pricing another the news that the Conference Board renminbi is not as about the prospect of a revaluation of the
doubt that the quarterly “management” fee set of negative figures, any numbers that are had downgraded its leading indica- bad as it seems for renminbi. Not only is the pace of reform
of 0.5 per cent will be wisely invested, but better than expected could provide the cata- tor for China before stock markets Chinese stocks expected to crawl along at a snail’s pace,
the returns remain extremely paltry lyst for a short-term bounce higher. However, tumbled across the world earlier this but “fundamentally, though, the renmin-
whichever way you look at it. “buyer beware” is the preferred stance for week. bi would remain on a crawling dollar
There are obviously plenty of things we the time being... so be prepared to sell those And although the markets’ sensitivity peg”, adds Williams. In that case, con-
could comment on this morning, but one very rallies. to the powerhouse of the east remains as cerns that a stronger currency could
important development is the recent move strong as ever, the equity market in weigh on China’s export competitiveness
on the S&P 500. The index clearly closed at Shanghai has suffered more than its seem overdone.
new lows for the year – sub 1,050 on western counterparts. It is down more In fact, Pierre-Yves Gauthier at
Tuesday night – and although we maybe than 25 per cent since the start of the Alphavalue says that the impact will be
could give it one more day to claw back some year, compared to the S&P 500, which has keenly felt by non-food retailers in the
gains, from a technical perspective that puts fallen 5 per cent in the same time period. west who produce their goods in China,
the bull market hypothesis firmly on hold for But is this rational and can the outlook such as Adidas, Hennes & Mauritz and
now. for China really have deteriorated so Next. “This could have an impact on the
much in such a short period of time? cost bases of these companies, for exam-
ANALYSIS l The S&P 500 is on a downward trend Some commentators argue that the ple some of them get 20 per cent of their
1,200
Shanghai market actually looks attrac- supplies from China.”
tive and now is the time to buy. Trading the Shanghai stock market
Firstly, fears about growth could be using listed products is a good way to get
1,150
overdone. The Conference Board cut its exposure with only limited downside
forecast for growth in April from 1.7 per risk, which is especially attractive during
1,100 cent to 0.3 per cent, which is still better this skittish period in the financial mar-
than what most western states can kets. But while the market got too carried
achieve. In fact, back in the first quarter away on dreams that the global economy
1,050 of this year investors were worried about would be saved by China, fears that its
an overheating economy when growth economy will stall seem outlandish, leav-
expanded by 11.9 per cent. Estimates for ing an opportunity for investors who con-
1,000 the second quarter are lower, nearer the tinue to believe in the long-term
Oct 09 Nov Dec Jan 10 Feb Mar Apr May Jun Jul Aug Sep
10 per cent mark, but growth at this rate prospects for China.
CITYA.M. 1 JULY 2010 THE MAVERICK OF 19
THE ANTIQUE WORLD
IN TOMORROW’S GOING
IT ALONE PAGE

ning of the year, many property funds ANALYSIS l UK real estate should gain in the long-run Source: FTSE The bookmaker’s
had to prevent withdrawals because of share price has
100
excessive outflows. And as iShares’ FTSE UK Office Property Index (GAV)
tumbled this year
Nizam Hamid points out: “Total returns 95 FTSE All UK Property Index (GAV)
in the UK’s physical direct investment Picture: PA
index last year rose by 16 per cent
Rebased Values
90
whereas property ETFs rose by 62 per
cent.” 85
This sensitivity could also mean, of
course, that losses are similarly exagger- 80
ated, so the overall question is whether
property is a good bet at all. Despite the 75
upsurge of prices last year, Better
Capital’s Jon Moulton believes there are Sep 2008 Jan 2009 May 2009 Sep 2009 Jan 2010 May 2010
many reasons to fear for the near-term
due to the likelihood of an interest rate
rise. As evidence, he cites the fact the THE
current 0.5 per cent rate is historically
low, especially given the ever-present TIPSTER
risk of inflation. A rise could slam loans
and property hard.
With such volatility, however, an
opportunistic investor who picks the
right moment to buy into a property
ETF and who can afford to hold out for
the long-term could stand to make a
good return. James Cannon of Cannon
LADBROKES’ WORLD CUP
Capital, an auctioneer for mostly com-
mercial property investors, says that
AS BAD AS ENGLAND’S
even though much of the boom-time
speculation has gone, there is still a lot MONTH ago we pointed out that the
of entrepreneurial demand for proper-
ties that will deliver long-dated rental
income in the 10-15-year range. He says:
“In the last 12 months we’ve been at the
bottom of the market. No one’s saying
A outlook for Ladbrokes was bearish
with the shares looking more likely to
go down than up. Since then,
Ladbrokes has fallen 7 per cent, despite
what should be a profitable World Cup and
we’re going to skyrocket out, but if the outlook has got even worse. It closed at
you’re living in Europe, English proper- a 6-month low at 131p, but more significant-
ty is now good value (compared to 2007). ly it fell below support levels around 132p
We’ve had two major price adjustments and technical signals remain bearish. This
so it’s now looking good value for a UK opens the door for another slide down to
investor.” And with a property ETF, even 120p in the medium term. 137p will be
if the market does look like it is turning resistance to the upside. Spread Co offers a
too sour, you can at least cut your losses spread on Ladbrokes of 129.4p-130.1p
quickly. Although the banking sector breathed a
sigh of relief after George Osborne’s fairly
lenient budget last week, there could still be
a bumpy ride ahead as changes to taxation
remain in the wings. But Lloyds Banking
Group, which recently slashed some of its
workforce, looks well-placed to outperform
in the sector. It is currently trading above
its 52-week low of 45p. Could it be over the
worst? Cantor Index offers a spread of
53.61p-53.80p.
Vodafone's share price has suffered
recently following Credit Suisse’s broker
downgrade on Tuesday. This could spur fur-
ther weakness in its share price, especially
during the current period of market turmoil.
Capital Spreads quotes a price of 139.3p-
1.39.6p.
It looks like the market was pre-empting
good news from HMV Group, after the
share price staged a strong rally. It rose
from 51p to 61.7p yesterday, following
Tuesday’s announcement of record sales in
excess of £2bn in the first four months of
the year. The 50-day simple moving average
points to a resistance level at 63p, but if
momentum continues then this level could
be overcome, and 70p should be the next
target. Spread Co offers a spread on HMV
Group of 61.7p-62.5p.
Analysts will be watching closely for
Debenhams’ trading report today, which
could be gloomy due to the coming VAT rise
in January. Cantor Index offers a spread of
52.87p-53.08p.
Kathleen Brooks

MARKET NEWS
JESSICA MEAD
ETF SECURITIES’ AUM SOAR FSA BOOSTS ETF PROFILE IN UK GFT REPORTS LONDON GROWTH
Exchange-traded funds (ETFs) provider ETF Use of ETFs in the UK is likely to get a boost Online spread betting and derivatives firm
Securities has seen its assets under manage- from new FSA regulations encouraging finan- GFT has released its 2009 results for its
ment (AUM) soar to $20bn as of 17 June, up cial advisers to take a closer look at the prod- London subsidiary. The privately held compa-
70 per cent on July 2009. Its holdings in uct, according to the first-ever survey of the ny announced that income rose to $50m in
Europe for its gold exchange-traded products UK ETF market, conducted by BlackRock. The 2009 and customer trading in spread bets
have now surpassed a record $10bn, which is report says that advisers are likely to increase rose by 49 per cent, with contracts for differ-
the largest in Europe. Its physical gold ETF their use of ETFs because the product is par- ence volumes more than doubling over the
has $5.2bn AUM while its Gold Bullion ticularly well-aligned with the intent of the year. To keep up with its growth in business
Securities ETF has $4.8bn of assets. The com- FSA’s Retail Distribution Review proposals. the company has also seen staff levels
pany said that this reflected European AUM in UK-listed exchange-traded funds increase by more than 400 per cent since it
investors' growing demand for hard assets as (ETFs) have doubled since 2008 - at the end launched in the UK in 2006. On top of this, its
they look to reduce their exposure to counter- of March, assets totalled $49.8bn in 239 dis- outlook for 2010 was also good and is expect-
Interest in gold has boosted ETF Securities Picture: REUTERS party and currency depreciation rates. tinct ETFs. ed to top last year.
20 Markets & Investments CITYA.M. 1 JULY 2010

LONDON’S TOP 250 Trade these shares from £1.50 with Interactive Investor - www.iii.co.uk
Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low
(p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p)
3i . . . . . . . . . . . . . . . . . . . . . . . .266.10* –8.10 314.80 216.75 COLT Group . . . . . . . . . . . . . . . .131.00 +1.00 144.20 105.50 ITV . . . . . . . . . . . . . . . . . . . . . . . .50.35 –0.05 71.75 31.75 Schroders . . . . . . . . . . . . . . . . .1213.00 –30.00 1450.00 764.00
3i Infrastructure . . . . . . . . . . . . . 113.00* –1.00 115.00 89.35 Compass . . . . . . . . . . . . . . . . . .512.00 –5.50 574.50 307.75 Jardine Lloyd Thompson. . . . . . .525.50 +2.00 604.50 399.00 Schroders N/V. . . . . . . . . . . . . .1001.00 –33.00 1185.00 643.50
A.B. Foods . . . . . . . . . . . . . . . . .974.50* +1.50 1045.00 752.00 Cookson . . . . . . . . . . . . . . . . . . .387.70 +3.20 616.00 220.00 Johnson Matthey . . . . . . . . . . .1494.00* –11.00 1814.00 1108.00 Scot. & Sthrn Energy. . . . . . . . . 1119.00 +1.00 1206.00 357.50
Aberdeen Asset Man . . . . . . . . . .129.00 –0.70 155.60 111.00 Croda Intl . . . . . . . . . . . . . . . . .1008.00 –6.00 1047.00 529.00 Kazakhmys . . . . . . . . . . . . . . . . .994.00 –38.00 1634.00 574.50 Scottish Mortgage. . . . . . . . . . . .556.50* — 623.50 376.00
Admiral. . . . . . . . . . . . . . . . . . .1409.00 +18.00 1441.00 861.00 CSR . . . . . . . . . . . . . . . . . . . . . .376.60 +2.10 524.00 338.75 Kesa Electricals . . . . . . . . . . . . .121.90 +1.90 162.00 98.45 SEGRO . . . . . . . . . . . . . . . . . . . .253.80 –6.20 403.10 250.00
Aegis . . . . . . . . . . . . . . . . . . . . .106.90* +0.10 137.30 81.50 Daily Mail ‘A’ . . . . . . . . . . . . . . . .439.00* –3.60 539.00 273.00 .LQJÀVKHU . . . . . . . . . . . . . . . . . . 211.20 –0.70 255.00 176.40
Afren . . . . . . . . . . . . . . . . . . . . . .85.05 –1.55 111.00 48.50 Dana Petroleum . . . . . . . . . . . . 1135.00 +29.00 1549.00 968.50 Ladbrokes . . . . . . . . . . . . . . . . .127.20 –4.20 174.29 114.60 Serco . . . . . . . . . . . . . . . . . . . . .588.00 –15.00 656.50 394.30
African Barr Gold . . . . . . . . . . . .634.50 +3.50 685.00 520.50 Davis Service . . . . . . . . . . . . . . .367.00 +1.50 442.30 311.25 Lancashire Hldgs . . . . . . . . . . . .498.30 +7.20 540.00 416.70 Severn Trent . . . . . . . . . . . . . . .1231.00* +4.00 1310.00 921.00
Aggreko . . . . . . . . . . . . . . . . . .1415.00 +15.00 1496.00 492.50 De La Rue . . . . . . . . . . . . . . . . . .947.50 –3.00 1021.00 808.50 Land Securities . . . . . . . . . . . . . .558.50* –13.50 743.50 415.25 Shaftesbury . . . . . . . . . . . . . . . .360.00* –2.10 426.50 285.25
Alliance Trust . . . . . . . . . . . . . . .303.70 –0.80 352.70 260.25 Debenhams . . . . . . . . . . . . . . . . .53.00 –1.75 91.95 51.95 Legal & General . . . . . . . . . . . . . .78.65 +0.30 94.40 49.37 Shire. . . . . . . . . . . . . . . . . . . . .1374.00 –1.00 1526.00 816.00
AMEC . . . . . . . . . . . . . . . . . . . . .826.00* +4.00 891.00 603.50 Derwent London . . . . . . . . . . . .1250.00 –12.00 1490.00 844.00 Lloyds Banking Gp . . . . . . . . . . . .53.70 –0.11 75.58 40.42 SIG . . . . . . . . . . . . . . . . . . . . . . .101.70 –1.80 146.60 86.75
Amlin . . . . . . . . . . . . . . . . . . . . .387.80 +3.00 428.50 291.00 Dexion Absolute . . . . . . . . . . . . .138.00 +1.90 148.00 117.00 Logica . . . . . . . . . . . . . . . . . . . .109.20 — 149.10 74.50 Smith & Nephew . . . . . . . . . . . . .635.50 +1.00 700.50 435.25
Anglo American . . . . . . . . . . . .2350.50 –37.50 3015.50 1557.50 Diageo . . . . . . . . . . . . . . . . . . .1060.00 +2.00 1176.00 857.00 London Stk Exchange . . . . . . . . .563.50 –9.50 949.50 561.50 Smiths . . . . . . . . . . . . . . . . . . .1072.00 +2.00 1186.00 677.50
Antofagasta . . . . . . . . . . . . . . . .786.50 –12.00 1100.00 561.00 Dimension Data . . . . . . . . . . . . . .94.50 –3.50 105.00 54.75 Lonmin . . . . . . . . . . . . . . . . . . . 1411.00 –44.00 2198.00 950.00 SOCO Intl . . . . . . . . . . . . . . . . . .397.60 +2.40 444.60 380.60
Aquarius Platinum . . . . . . . . . . .328.30 –14.20 490.00 172.75 Domino’s Pizza . . . . . . . . . . . . . .380.00 +6.10 387.80 200.00 Man . . . . . . . . . . . . . . . . . . . . . .223.30 –17.80 373.60 199.60 Spectris . . . . . . . . . . . . . . . . . . .776.00 +10.50 928.00 512.50
ARM Holdings . . . . . . . . . . . . . . .277.50 –1.80 362.40 116.00 Drax . . . . . . . . . . . . . . . . . . . . . .376.30 +7.20 496.50 321.50 Marks & Spencer. . . . . . . . . . . . .331.80* +1.60 412.70 302.25 Spirax-Sarco Eng . . . . . . . . . . .1370.00 +3.00 1591.00 809.00
Arriva . . . . . . . . . . . . . . . . . . . . .765.00 +0.50 782.50 378.50 DSG Intl . . . . . . . . . . . . . . . . . . . .24.81 –0.85 39.75 19.25 Meggitt . . . . . . . . . . . . . . . . . . . .314.10 +10.40 331.00 151.75 Spirent Comms . . . . . . . . . . . . . .109.70 +1.50 127.80 54.50
Ashmore . . . . . . . . . . . . . . . . . . .243.30 –0.40 311.20 183.25 Dunelm . . . . . . . . . . . . . . . . . . . .331.10 +5.10 438.40 202.50 Melrose . . . . . . . . . . . . . . . . . . .210.40 –0.90 251.50 90.00
Astrazeneca . . . . . . . . . . . . . . .3169.00 +222.00 3262.00 2631.50 Easyjet . . . . . . . . . . . . . . . . . . . .397.80 +0.40 499.90 260.00 Mercantile IT . . . . . . . . . . . . . . . .863.50 –7.50 1002.00 726.00 Sports Direct Intl . . . . . . . . . . . . .104.30 +1.80 134.00 72.50
Atkins(Ws) . . . . . . . . . . . . . . . . .683.50 +4.00 747.00 532.50 Edinburgh Inv Tst . . . . . . . . . . . .383.40* +0.50 412.40 298.50 Michael Page Intl. . . . . . . . . . . . .372.80 –5.90 461.50 218.50 SSL Intl . . . . . . . . . . . . . . . . . . . .810.00 +12.50 893.50 506.00
Autonomy Corp . . . . . . . . . . . .1837.00 +18.00 2012.00 1121.00 Electrocomponents . . . . . . . . . . .216.90* –2.70 245.00 134.25 Micro Focus . . . . . . . . . . . . . . . .422.60 +21.00 550.00 300.90 St James’s Place . . . . . . . . . . . . .212.20 +0.20 296.90 172.25
Aveva . . . . . . . . . . . . . . . . . . . . 1130.00* +3.00 1237.00 666.50 EnQuest . . . . . . . . . . . . . . . . . . . .99.40 +0.40 112.70 87.35 Millen & Copthorne . . . . . . . . . . .407.00 –13.00 496.30 227.75 Stagecoach. . . . . . . . . . . . . . . . .177.00 –3.40 204.90 123.25
Aviva . . . . . . . . . . . . . . . . . . . . .314.10 –3.70 474.00 274.75 Essar Energy . . . . . . . . . . . . . . .475.20 +17.60 475.90 358.50 Misys . . . . . . . . . . . . . . . . . . . . .234.00 –0.10 281.70 165.25 Standard Chartered . . . . . . . . . .1641.00 –18.50 1847.00 1115.00
Babcock International . . . . . . . . .597.00* +8.00 660.50 448.50 Eurasian Nat Res . . . . . . . . . . . .861.00 –32.50 1276.00 632.00 Mitchells & Butlers . . . . . . . . . . .274.00 –5.40 343.90 228.30 Standard Life . . . . . . . . . . . . . . .174.50 –0.40 237.00 172.60
BAE Systems . . . . . . . . . . . . . . .313.50 +0.70 389.90 294.20 Euromoney Inst Inv . . . . . . . . . . .599.50* +4.00 630.00 200.00 MITIE . . . . . . . . . . . . . . . . . . . . .212.30* –0.50 281.70 198.70 SuperGrp . . . . . . . . . . . . . . . . . .745.00 –2.00 764.00 499.00
Balfour Beatty . . . . . . . . . . . . . . .239.30* +1.50 328.85 236.40 Experian . . . . . . . . . . . . . . . . . . .586.00* –16.00 664.50 437.50 Mondi . . . . . . . . . . . . . . . . . . . . .384.10 +4.30 488.00 187.50 TalkTalk . . . . . . . . . . . . . . . . . . .125.00 +2.90 147.10 106.60
Barclays . . . . . . . . . . . . . . . . . . .270.55 +3.20 394.25 255.00 F&C Comm Prop . . . . . . . . . . . . . .91.40 +0.90 96.80 73.50 Monks Inv Tst . . . . . . . . . . . . . . .286.00 +0.40 321.20 222.00 Talvivaara Mining . . . . . . . . . . . .365.00 +12.70 501.50 319.00
Barratt Development . . . . . . . . . . .94.80 –3.20 193.31 93.70 Ferrexpo . . . . . . . . . . . . . . . . . . .248.30 –9.00 396.20 112.00 Morrison Wm . . . . . . . . . . . . . . .266.10 –1.50 306.30 234.25 Tate & Lyle . . . . . . . . . . . . . . . . .449.70* +5.20 509.00 284.75
BBA Aviation . . . . . . . . . . . . . . .183.30 –2.00 220.00 105.00 FirstGroup . . . . . . . . . . . . . . . . .365.60 –9.10 448.80 322.75 Murray Intl Tst . . . . . . . . . . . . . . .825.50 +4.00 893.50 593.50 Taylor Wimpey . . . . . . . . . . . . . . .26.36 –1.97 54.90 26.00
Beazley. . . . . . . . . . . . . . . . . . . . 113.10 –2.60 124.80 95.25 Foreign & Col Inv Tst. . . . . . . . . .259.00 — 297.20 210.25 National Express. . . . . . . . . . . . .220.10 +0.20 256.80 135.86 Telecity . . . . . . . . . . . . . . . . . . . .400.40 +1.40 455.00 294.00
Bellway. . . . . . . . . . . . . . . . . . . .615.50* –12.50 927.50 591.50 Fresnillo . . . . . . . . . . . . . . . . . . .979.50 –20.50 1115.00 438.00 National Grid . . . . . . . . . . . . . . .491.00* +2.10 607.65 469.37
Berkeley . . . . . . . . . . . . . . . . . . .763.50 –6.50 989.50 735.00 G4S . . . . . . . . . . . . . . . . . . . . . .267.30 –5.20 285.70 203.75 Next . . . . . . . . . . . . . . . . . . . . .2009.00* –14.00 2360.00 1463.00 Templeton Emrg Mkts . . . . . . . . .528.00* +4.50 598.00 349.50
BG . . . . . . . . . . . . . . . . . . . . . .1006.00 –14.00 1248.00 966.90 Genesis Emerging Mkts Fd . . . . .456.00 +6.00 484.00 370.00 Northumbrian Water . . . . . . . . . .304.60 +3.30 312.00 219.90 Tesco . . . . . . . . . . . . . . . . . . . . .380.05* –9.80 454.90 347.40
BHP Billiton . . . . . . . . . . . . . . .1754.50 –17.50 2346.00 1274.50 GKN . . . . . . . . . . . . . . . . . . . . . . 116.30 +0.20 155.00 71.75 Old Mutual . . . . . . . . . . . . . . . . .103.50 –1.50 127.20 74.60 Thomas Cook . . . . . . . . . . . . . . .178.60 –4.90 277.20 178.00
BlackRock Mining . . . . . . . . . . . .549.00 –3.50 654.50 346.00 GlaxoSmithKline . . . . . . . . . . . . 1143.00* +20.00 1347.00 1058.00 Partygaming . . . . . . . . . . . . . . . .216.30 –13.80 339.70 213.30 Tomkins . . . . . . . . . . . . . . . . . . .226.80 –2.40 261.10 141.75
Booker . . . . . . . . . . . . . . . . . . . . .41.00* +0.78 49.50 33.00 Great Portland Estates . . . . . . . .290.90 +0.20 332.10 203.75 Pearson . . . . . . . . . . . . . . . . . . .888.00 –2.50 1069.00 574.00 Travis Perkins . . . . . . . . . . . . . . .733.00 –10.00 915.00 518.50
BP . . . . . . . . . . . . . . . . . . . . . . .318.90 +16.00 658.20 296.00 Greene King . . . . . . . . . . . . . . . .392.30 +0.20 504.00 372.50 Pennon . . . . . . . . . . . . . . . . . . . .553.00 +7.50 567.00 434.40 TUI Travel . . . . . . . . . . . . . . . . . .209.30 –2.90 313.90 209.10
Brit Insurance . . . . . . . . . . . . . . .905.00* +8.00 970.00 709.00 Halfords . . . . . . . . . . . . . . . . . . .489.70 –28.80 562.50 306.25 Persimmon . . . . . . . . . . . . . . . . .350.00 –11.00 534.50 345.70 Tullett Prebon . . . . . . . . . . . . . . .315.90 +1.50 436.20 261.20
British Airways . . . . . . . . . . . . . .196.00 –1.00 255.80 117.30 Halma . . . . . . . . . . . . . . . . . . . . .274.10 +3.00 284.90 184.00 Petrofac . . . . . . . . . . . . . . . . . . 1186.00 +26.00 1294.00 633.50 Tullow Oil . . . . . . . . . . . . . . . . .1003.00 –17.00 1375.00 834.50
British Amer. Tob . . . . . . . . . . .2136.50 +39.00 2335.50 1664.00 Hammerson . . . . . . . . . . . . . . . .343.70 –5.30 460.30 277.00 Petropavlovsk . . . . . . . . . . . . . . 1190.00 +10.00 1370.00 516.50 UK Commercial Prop. . . . . . . . . . .79.35 +1.65 84.90 62.25
British Empire Tst . . . . . . . . . . . .417.00 +4.90 467.90 338.50 Hargreaves Lansdown . . . . . . . .338.40 +3.60 387.00 197.25 Premier Farnell . . . . . . . . . . . . . .219.00 –3.00 252.60 122.25 Ultra Electronics . . . . . . . . . . . .1537.00 +2.00 1678.00 1079.00
British Land . . . . . . . . . . . . . . . .435.60 –2.20 532.00 353.00 Hays . . . . . . . . . . . . . . . . . . . . . . .91.70 –0.15 119.00 80.00 Premier Oil . . . . . . . . . . . . . . . .1243.00 +25.00 1431.00 984.00 Unilever . . . . . . . . . . . . . . . . . .1801.00 +24.00 2024.00 1419.00
Britvic. . . . . . . . . . . . . . . . . . . . .475.40* +4.30 497.70 277.00 Henderson . . . . . . . . . . . . . . . . .122.80 +2.40 157.80 87.75 Provident Financial . . . . . . . . . . .840.00 –2.00 986.00 763.00 United Utilities . . . . . . . . . . . . . .525.50* +5.50 575.00 429.00
Brown(N.) . . . . . . . . . . . . . . . . . .250.30 –13.70 284.30 204.25 Heritage Oil. . . . . . . . . . . . . . . . .394.20 –2.90 587.00 392.10 Prudential . . . . . . . . . . . . . . . . . .508.50 –6.00 665.00 350.25
BSkyB . . . . . . . . . . . . . . . . . . . .700.50 –0.50 732.00 448.00 Hikma Pharma . . . . . . . . . . . . . .713.50 +6.50 730.00 430.00 PZ Cussons . . . . . . . . . . . . . . . .341.80 +9.40 344.50 197.00 Utd Business Media . . . . . . . . . .497.00 +5.60 579.50 364.75
BT . . . . . . . . . . . . . . . . . . . . . . .130.10 –0.40 151.00 99.50 Hiscox . . . . . . . . . . . . . . . . . . . .342.40 +1.20 369.30 279.50 Qinetiq . . . . . . . . . . . . . . . . . . . . 117.10 +0.60 179.10 113.90 Vedanta Resources . . . . . . . . . .2125.00 –43.00 2967.00 1264.00
Bunzl . . . . . . . . . . . . . . . . . . . . .673.50* –0.50 784.50 498.25 Hochschild Mining . . . . . . . . . . .307.90 +0.90 370.60 220.00 Randgold Resources. . . . . . . . .6425.00 +65.00 6600.00 3351.00 Victrex . . . . . . . . . . . . . . . . . . .1094.00* +5.00 1193.00 537.00
Burberry . . . . . . . . . . . . . . . . . . .761.50 –2.50 815.50 403.25 Home Retail . . . . . . . . . . . . . . . .214.50* +1.10 336.50 211.70 Reckitt Benckiser . . . . . . . . . . .3132.00 +52.00 3667.00 2686.00 Vodafone . . . . . . . . . . . . . . . . . .139.15* –3.10 153.80 111.90
Cable & Wire Comms . . . . . . . . . .57.75* –0.30 150.00 53.00 Homeserve . . . . . . . . . . . . . . . .2007.00 +14.00 2190.00 1336.00 Reed Elsevier . . . . . . . . . . . . . . .499.00 +2.10 548.00 403.75 VT . . . . . . . . . . . . . . . . . . . . . . .775.00 +4.50 782.50 416.00
Cable & Wire Wwide . . . . . . . . . . .86.60* –0.40 94.80 68.60 HSBC Hldgs . . . . . . . . . . . . . . . .615.20* –0.30 766.80 487.00 Regus . . . . . . . . . . . . . . . . . . . . . .69.90 –0.75 125.50 61.00 Weir . . . . . . . . . . . . . . . . . . . . .1037.00 –16.00 1183.00 437.50
Cairn Energy. . . . . . . . . . . . . . . .414.90 +6.70 448.60 306.80 Hunting . . . . . . . . . . . . . . . . . . .448.30 +6.10 659.50 377.00 Rentokil Initial . . . . . . . . . . . . . . .107.90 –1.40 140.20 82.25 WH Smith . . . . . . . . . . . . . . . . . .409.30 –4.20 551.00 405.00
Caledonia Invs . . . . . . . . . . . . .1583.00 +26.00 1759.00 1495.00 ICAP . . . . . . . . . . . . . . . . . . . . . .405.20 +0.50 478.30 291.70 Resolution . . . . . . . . . . . . . . . . . .63.30† +3.00 99.15 58.45 Whitbread . . . . . . . . . . . . . . . . .1409.00* –23.00 1645.00 778.50
Capita . . . . . . . . . . . . . . . . . . . . .741.00 –19.50 829.50 643.50 IG . . . . . . . . . . . . . . . . . . . . . . . .421.00 +1.00 458.20 261.25 Rexam . . . . . . . . . . . . . . . . . . . .303.00 –0.50 331.20 222.50 William Hill . . . . . . . . . . . . . . . . .171.30 –0.90 217.80 160.50
Capital & Counties . . . . . . . . . . .108.50 +3.20 125.40 99.60 Imagination Tech Gp . . . . . . . . . .280.20 +2.90 311.60 130.00 Rightmove . . . . . . . . . . . . . . . . .630.00 +3.50 729.00 334.00 Witan Inv Tst . . . . . . . . . . . . . . . .419.50 +2.40 487.00 329.50
Capital Shopping Centres . . . . . . 311.60 –2.40 580.00 300.20 IMI . . . . . . . . . . . . . . . . . . . . . . .687.50 +0.50 756.50 275.25 Rio Tinto . . . . . . . . . . . . . . . . . .2968.50 –79.50 4104.00 1822.00 Wolseley . . . . . . . . . . . . . . . . . .1339.00 –49.00 1742.00 1026.00
Carillion . . . . . . . . . . . . . . . . . . .309.00 –0.20 361.90 244.00 Imperial Tobacco. . . . . . . . . . . .1879.00 +25.00 2159.00 1547.00 RIT Capital Partners . . . . . . . . . 1147.00 +3.00 1200.00 877.00
Carnival . . . . . . . . . . . . . . . . . .2183.00 +29.00 2937.00 1574.00 Inchcape. . . . . . . . . . . . . . . . . . .246.00 –6.00 347.00 244.70 Rolls Royce . . . . . . . . . . . . . . . .562.50* –6.00 631.50 346.50 Wood Group (John). . . . . . . . . . .313.20 +4.80 411.70 231.25
Catlin . . . . . . . . . . . . . . . . . . . . .351.70 +4.00 380.50 284.75 Informa . . . . . . . . . . . . . . . . . . . .355.70 +0.90 439.40 216.00 Rotork . . . . . . . . . . . . . . . . . . .1285.00* +13.00 1482.00 779.50 WPP . . . . . . . . . . . . . . . . . . . . . .635.50 +5.50 744.00 380.50
Centamin Egypt . . . . . . . . . . . . .164.40 –0.10 174.75 77.86 Inmarsat . . . . . . . . . . . . . . . . . . .714.50 –5.50 831.00 491.00 Royal Bank Of Scot . . . . . . . . . . . .41.43 –0.34 58.95 28.25 Xstrata . . . . . . . . . . . . . . . . . . . .886.80 –21.90 1344.50 555.10
Centrica . . . . . . . . . . . . . . . . . . .296.70 +0.20 320.00 212.50 Intercontl Hotels . . . . . . . . . . . .1063.00 –42.00 1244.00 584.50 Royal Dutch Shell A . . . . . . . . .1701.00 –7.00 2068.50 1431.00 Yell Group. . . . . . . . . . . . . . . . . . .24.51 –0.19 86.00 21.00
Charter Intl . . . . . . . . . . . . . . . . .628.50 –6.00 855.50 406.50 Intermediate Capital . . . . . . . . . .250.00 +1.60 332.00 170.25 Royal Dutch Shell B . . . . . . . . .1631.00 –7.50 1997.50 1437.00 LONDON TOP 250 BY MARKET CAPITALISATION
Chemring . . . . . . . . . . . . . . . . .2974.00 –13.00 3711.00 1993.00 Intertek . . . . . . . . . . . . . . . . . . .1443.00 –4.00 1576.00 1024.00 RSA Insurance . . . . . . . . . . . . . . 119.60 +0.40 142.00 113.10
Chloride Group . . . . . . . . . . . . . .386.00 –1.10 390.50 129.00 Intl Power . . . . . . . . . . . . . . . . . .300.30 +1.20 354.00 231.00 SABMiller . . . . . . . . . . . . . . . . .1889.00 –21.50 2090.00 1210.00 * Ex-Dividend † Suspended
Close Bros . . . . . . . . . . . . . . . . .693.00 +1.50 806.50 623.00 Invensys . . . . . . . . . . . . . . . . . . .241.60* –8.90 350.30 212.25 Sage . . . . . . . . . . . . . . . . . . . . . .231.60 +2.80 260.50 167.20
Cobham . . . . . . . . . . . . . . . . . . .213.30* –0.30 278.60 171.60 Investec . . . . . . . . . . . . . . . . . . .453.60 –3.60 565.00 323.75 Sainsbury(J) . . . . . . . . . . . . . . . .321.50* +0.40 373.00 307.60 www.interactivedata.com

AstraZeneca leads flat FTSE after US US stocks fall at end of


patent win as BP rises on takeover talk worst quarter since 2008
with the European debt crisis and traders citing speculation of a possi- Markets in Jersey City, New Jersey,

THELONDON
BP’s environmental disaster weigh-
ing heavily,” said Mic Mills, head of
ble takeover of the company resur-
facing following broker comment. THENEW YORK said of the late sell-off.
The S&P 500 fell below the 1,040

REPORT
electronic trading at ETX Capital. BP has still lost 52 per cent since level that it had held since February,

REPORT “Given yesterday’s plunge there


was rather likely to be a little bounce
today, but with the non-farm pay-
its oil spill, the worst ever US envi-
ronmental accident, began in the
Gulf of Mexico in mid-April. The sea-
breaking out to the downside from
what chartists call a very bearish
“head and shoulders” price pattern

U
rolls on Friday investors remain very son’s first Atlantic hurricane is dis- S stocks staggered to the end of and suggesting a major fall could

B
RITAIN’S leading share index cautious.” rupting the clean up of the massive a dismal second quarter yester- come in the next five months.
was flat yesterday after a chop- AstraZeneca was the biggest blue oil spill. day in another low volume ses- To make matters worse, leveraged
py session on the last day of chip gainer, up 7.5 per cent after the sion as investors found little short ETFs, widely blamed for a por-
the second quarter, with gains drugmaker won a patent trial in the ANALYSIS l FTSE reason to take on risk after conflict- tion of Tuesday's losses, were also
by AstraZeneca after a key US patent United States involving its block- 6,000 ing economic data. cited for the late sell-off as managers
was upheld just countering weak- buster statin drug Crestor, leading 5,800
4916.87 The day ended like many during piled on bets the market will fall.
ness in miners. several brokers to upgrade ratings 30 Jun the quarter, with a late-day sell-off as Those funds shorted the market to
At the close, the FTSE 100 was up and targets for the stock. 5,600 buying interest waned and investors keep up with customer demand.
2.65 points, or 0.1 per cent at The news lifted sentiment in the sold underperforming stocks in the The Dow Jones industrial average
5,400
4,916.87, notching up a 13.4 per cent heavyweight sector, helping worst quarter since the market melt- dropped 96.28 points, or 0.98 per
decline for the second-quarter, the GlaxoSmithKline gain 1.8 per cent. 5,200 down triggered by the collapse of cent, to 9,774.02. The Standard &
worst performance since the third Integrated oils were also higher as Lehman Brothers. Poor’s 500 Index slid 10.53 points, or
quarter of 2002 when the dot.com a sector thanks to a bounce back by 5,000 “Just pushing all the garbage off 1.01 per cent, to 1,030.71. The Nasdaq
boom collapsed. BP, 5.3 per cent higher as investors 4,800
the side of the ship,” Peter Kenny, Composite Index fell 25.94 points, or
“It’s been a very tough quarter, picked up shares cheaply, and with 12 Apr 30 Apr 21 May 11 Jun managing director at Knight Equity 1.21 per cent, to 2,109.24.00
City Focus INSPIRED IDEAS 21
FOR INTERIORS
| Careers IN FRIDAY’S PROPERTY
SUPPLEMENT

How to learn from Capello’s mistakes


Bad management is
behind England’s
football failure, writes
Jeremy Hazlehurst

P
OOR defending, non-existent mark-
ing, a lack of passion – there are
numerous reasons for England’s
horrible World Cup performance.
Interestingly, though, many have argued
that all the problems on the field were
symptoms of troubles off it. The team, it
appears, didn’t get on with the manager.
Capello’s boot-camp culture clashed with
the laid-back attitude of his team and the
result was not just performances that sent
grown men scuttling behind the sofa in
horror, but gloomy body-language and –
most importantly – insubordination from
a senior player when he blamed the coach
for the sub-standard results.
Chaos? Maybe. But the problems are
common ones in business, says David
Sims, professor of management at
London’s Cass business school. In particu-
lar, refusing to take responsibility for
poor performance and shifting the blame
onto others is something that often hap-
pens. It is, says Sims, best seen as a child-
ish behaviour. “Saying: ‘It’s all his fault’,
shirking responsibility and leaving it as
someone else’s problem is how children
act, expecting the adult to take care of
them,” he says.
As a manager, it is easy to respond to
this by moving into the parent role and
everybody is happy, but it doesn’t resolve
the problem. Indeed, some of the man-
agement behaviour we have seen – like
giving somebody a night out when they even more. If they end up convincing Maybe not the versation about roles and responsibilities partner, where you are going on holiday.
have won, or in other words, done their themselves that there are the injured best way to is needed. Those watercooler moments are vital. As a
job properly – reinforces the dynamic. It’s hero, then that is the worst thing.” People motivate people. Jacqueline Davies, co-author of The leader there is a real risk of becoming
like giving a child sweets when they can convince themselves they are being Truth about Talent and a former head of remote”. For the same reason, you have to
behave. This is not a solution, says Sims. shockingly treated, and that is a hard con- Picture: ACTION learning and development at Lloyds socialise with people – to have social rela-
“You need to move to an adult-adult rela- viction to break down. IMAGES TSB/HBOS, RBS and HSBC, says that as a tionships, you have to create a social
tionship.” In such a situation, there are two cours- manager you need to be transparent, set bond. “Sometimes going for a drink with
One of the oddest parts of this saga is es of action, says Sims. Either the out what you expect from people, what somebody you don’t get on with is the last
that the manager didn’t seem able to win manager starts behaving in an equally are their roles in the team and what thing you want to do, but it gives you
the respect of his team, despite his proven childish way and takes away privileges, or counts as success. However, this should be more intelligence to deal with the situa-
record. Even though Capello – who as a alternatively he gets somebody in to talk about principles, not a rigid set of rules. tion.”
player achieved more than any of the to the team about what it means to have “You have to be able to adapt but some Finally, authoritarian leaders run the
England players have and has won the this sort of professional relationship. managers, especially older ones, find this risk of being seen as bullies. The idea that
Italian and Spanish leagues as a manager That said, the manager also has respon- flexibility hard.” leadership has to be macho is still preva-
– has apparently struggled to gain his sibilities. “I think that it you have joined a Secondly, she says, you have to get to lent in the City, but this leads to a culture
team’s respect. culture then you have the responsibility know people. Capello’s poor English may where people go into passive-aggressive
Surely his achievements should give to move that culture on. If you do it your have hindered this, but “especially when mode; they do as they’re told but only do
him some authority? “If you are a person way and people throw hissy fits then you have people with strong opinions, as they are told because they are scared of
of moderate talent but a big ego,” says there is a cultural problem and you have you need to know how to motivate them. stepping out of line and do things to spite
Sims, “then you probably wouldn’t accept to address it. If you just keep on saying: It also gives you early intelligence when you. “Fear only gets you short-term
that the manager had been better than ‘We are going to do it my way’, then you things are going wrong. The best man- results, but is not way to build long-term
you and that would make him resent it don’t get anywhere.” Again, an adult con- agers know what is going on with your success.”

When work becomes a religious experience


THE WAY WE’RE The book begins from the premise that shift in the centre of gravity of our lives, I actually found the premise of the book
work in the modern corporation is not from ‘me’ to ‘us’.” Much is made of the baffling. Do people really expect work to
WORKING ISN’T very satisfying, that the “time-for-money” four “emotional quadrants”, amusingly satisfy all their needs and desires? If so,
WORKING exchange does not engage the whole introduced via a cross-like diagram. they seem to have fundamentally misun-
BY TONY SCHWARTZ, JEAN human being. Or as the authors put it: Leaders are “chief energy officers”, who derstood what work is under capitalism:
GOMES AND CATHERINE “The relentless urgency that characterises should “refuel the energy” of the people an exchange of time for money. Perhaps
MCCARTHY, £12.99 most corporate cultures undermines they manage. Excuse me while I start it’s an American thing.
thoughtful deliberation, creativity, speaking in tongues and foaming at the “Human being have made extraordi-

T
HE title might sounds a bit like the engagement and sustainable high per- mouth. It’s like Peter Drucker meets the nary advances in science, medicine and
election poster from 1979 that pro- formance”. Moonies. technology, but we’ve devoted
claimed “Britain isn’t working”, but The solution? Corporations should Thankfully, though, the road to this remarkably little attention to understand-
this book is American through and change so that people are rewarded for promised land is actually rather simple. A ing our inner world,” write the authors at
through. It reached number two on the the “value” they create, not what they get large part of the book is devoted to telling one point. Go tell that to Proust.
New York Times Best Sellers List, which done, and the job of businesses should be us that sleep, rest, exercise and eating well This book is aimed at just those people
suggests that it addresses a need – perhaps to “fuel spiritual energy”. Which sounds are good for you. Most of the information who have devoted remarkably little atten-
this is the point of the business cycle when more to me like a church than a going in TWWWIW is pretty commonsense tion to understanding their inner world.
people start believing that corporate life concern. We should move to a new way of stuff. If you love your work, we are told, They are unlikely to find themselves any
can change for the better. working, which “requires an evolutionary you will enjoy it more. more enlightened after reading it.
Lifestyle
22 CITYA.M. 1 JULY 2010

| Books

The book that’s got men cracked


City A.M.’s very own
Zoe Strimpel spent a
year finding out what
blokes really think
EXTRACT
WHAT THE HELL IS HE THINKING?
ALL THE QUESTIONS YOU’VE
EVER ASKED ABOUT MEN
ANSWERED
BY ZOE STRIMPEL
Fig Tree, £8.99

WHY DOES HE BOTHER WITH GRAND GESTURES,


THEN FAIL TO FOLLOW THROUGH?

E
VERY girl, no matter how independ-
ent and cynical, wants to be swept off
her feet. Dear God, I’m putty in the
hands of a man who buys me flowers
or champagne. Could there be a sadder,
more clichéd confession from someone
who thinks of herself as a feminist?
But even the most sensible of us have a
huge capacity for grand romantic gestures,
because they make us feel loved, and we all
want to – and think we should – be loved.
C’mon, we do.
So, this whole grand-gesture-equals-love
equation is hard to shake, even though we
should know better. I mean, in the old days,
chivalry and shameless wooing were de
rigueur even if you weren’t going to get
into somebody’s pants, ever. Now we’re in a
post-romantic age and it’s all about subtle
or no gestures, big gloopy ones carry a
major, dangerously effective wow factor.
(Nothing cheesy or creepy, mind. It can be a time, though she was still on her guard: Zoe Strimpel on the just gone off her? will think about whether he truly wants
thin line.) guys like this are usually up to something. City A.M. office roof. her now the chase was successful.”
It’s all very well for a guy to do the big Two days later, when a first-class return WHAT THE GUYS THINK:
gestures when the time is right. But what ticket to Moscow (yes, Moscow, and yes, first Picture: PETER W, 51, MARRIED TWICE FLAT-OUT INITIALLY
I’ve never understood is why he does them class) came through her letter-box – he was Micha Theiner Mr Virility “Many guys do go flat-out with a girl ini-
when he’s about to bugger off. I’m not talk- going there on business the next day – she /City A.M. “Obviously this guy is a professional bache- tially, then leave it suddenly. One of my
ing about obvious arseholery here, or pick- gulped and went along with it. Who would- lor. Intensely driven to get the girl into bed. best friends seems to do this, finding out
up artistry for its own sake. I’m talking n’t? He met her at the airport with flowers That achieved – goal scored! – he got bored only after wooing her senseless that he is
about similar situations to the one my and designer vodka and ferried her off to with her and hankered for the next one.” now bored. I think this is because he is
friend Marissa found herself in last year – his hotel suite. They spent a magical few Simple as that! How shallow can you be? insecure, he loves being loved and wants
when the guy really seems to mean it, days together (how couldn’t they?), and she Then again, as Victor (my ex-flatmate’s her to fall for him as quickly as pos-sible. A
wants to mean it, has no cause not to mean was just starting to come round to the idea boyfriend) put it, men are built to ‘sow girl who shows initial interest but doesn’t
it since he’s the initiator, then buggers off that all these gestures were an artless func- their seed’, whereas women who shag fall for him leaves a serious bruise on a
all the same. tion of his deep and solid passion for her. competitively are motivated by more com- man’s ego.
Of course, part of her remained a little plex, less biological factors. I think he’s “Once fallen, this man can now decide
THE CASE wary still, “too good to be true” pounding right. That said, I won’t accept the idea what to do, knowing his ego is fine whatev-
MY friend Marissa (29 and blessed with a in her temples. When he’d left her at the that men can get away with shitty behav- er the decision.”
mane of voluminous blonde hair) was at airport, he’d talked like he meant to go on iour because they’re ‘built’ for it. Just to be So Frank needs to be loved – repeatedly –
her parents’ thirtieth wedding anniversary in this vein, finding a way in his busy inter- clear. but he does not need to love, and once
in Edinburgh. national schedule to make time for her, “He hankered for the next . . . and the Marissa showed signs of falling for him, he
She was just minding her own business and so on. next,” continues Peter. ‘He’s rich, attrac- got bored.
and having a dance with mates when sud- When she’d heard nothing the next day, tive, permanently single and loves to f**k
denly Frank – an older man with gorgeous, she sniffed trouble. When the silence con- new girls. Mr Virility. The more the better. BOTTOM LINE:
slightly creased green eyes – appeared. She tinued for three more days, she knew it But it’s the newness that is attractive (not This sort of man is on a permanent, ego-
wasn’t too bothered, being used to come- was only a matter of time before she found the chase, as some would have you believe). aggrandizing roll, and you’ll just get rolled
ons from all manner of eligible men, but he out that Frank was indeed too good to be Another conquest! Another one to add to over unless you step out of the way.
had maturity on his side, and for a woman true. The email (!) arrived one week after the “feel pretty darn good about myself” Marissa’s only hope was to keep her dis-
like Marissa who’d had it with disappoint- she returned from Moscow. Frank said list. Now it’s time to cut loose and check tance – perhaps for ever. Worth it if you
ing twenty- somethings this gave him an in. work had been crazy and that while he out the new girl over there.” like the high life and have enough inner
He’d spied her across the room (it’s hard thought Marissa was a nice girl he couldn’t So New, new, new. Score that goal. confidence and self-esteem to play it cooler
to resist that hair, and Marissa always looks see it working through this period of Wham bam, I’m a man. He’s driven by bed- than most of us are capable of doing.
like she’s having the best time), and set his intense travel and research for his next notches and novelty only. Could it be? Even What to do if you still fancy him: Be dis-
sights on her. She didn’t play very hard to project. Marissa laughed a little, felt a bit with a man as seemingly civilized as ciplined about holding back. Do not agree
get – she’s not into games – and went along bummed out because she’d fallen for his Frank? With a guy who knows what to every arrangement, every dinner date,
with him to his hotel room. Hell, she’s up tricks, but was glad he hadn’t dragged it designer vodka is? Apparently so. so quickly; do not go along with every woo.
for as much fun as the next girl and felt like out any further. This might well give him enough space to
a little post-party naughty business. But what had he been playing at? He VICTOR L, 28, IN A SERIOUS RELATIONSHIP figure out that he wants you, rather than
Nothing else. could have made the same grand gestures Want her thinking about how great he is giving him the instant gratification he is
So when she left the next morning amid while making it clear it was all whim, a “There’s no question that a guy wants to seeking from you. (But don’t hold your
his promises to call her, she was as cool as a spur-of-the-moment thing. Instead, he sweep a girl off her feet as quickly as possi- breath.) If you have a history of getting
cucumber (well, maybe a little ruffled), and went on about how amazing she was and ble. This is fact. Guys just do that, they hooked and not taking coldness or playing
not overly bothered. She’d barely had time how he could see them together. The com- want her thinking about him and how games well, try, try, try to avoid this guy.
to get back to London when a handwritten bination of dinners, a flight and chats great he is. The quicker she falls for him, Copyright Zoe Strimpel 2010. Extracted from
note was pushed through the letter-box about the long term sure made his sudden the more secure the guy will feel, and he’ll WTHIHT? All The Questions You Ever Asked
inviting her to dinner the next night. He frost odd. Was he a pathological romantic? be able to sit back, sigh and assess this About Men Answered, which is published today
wined and dined her and they had a lovely An evil manipulating player? Or had he “new girl”. Once in this comfort zone, he (Penguin £8.99).
CITYA.M. 1 JULY 2010 Lifestyle | Food & Drink 23

London is
The Gaul the world loves buzzing with
The man behind the
iconic Sketch is on a
new openings
roll. Zoe Strimpel asks Tim Badham
him what his secret is
Going
Out
I
’VE visited a lot of restaurants in
London: flashy ones, rustic ones,
refined European ones, rooftop ones,
flamboyantly ethnic ones and ones
that closed after not very long at all. My
favourite, on many levels, is Sketch – less a
restaurant than a pleasure dome. I love that
an eccentric man greets you and speaks in
strange quasi-Irish tones and that later if
you go for outside for a smoke he’ll cover
your shoulders in a smoking jacket. I love
that there are not one but three dining
rooms, all wildly different. I love that there
are hopscotch squares in permanent chalk
in the entryway. And of course, that one set
of toilets are white pods, and the other have
diamante crucifixes on the toilet seats.
But at the core of this completely unique
venture is one of the world’s most famous,
successful French chefs, Pierre Gagnaire.
Amid the glitz and glamour of the toilet
pods, Michelin-starred food takes a starring
role (for those who like such things). With a
kitchen that cooks outrageously inventive
cuisine that laughs at both “fine dining”
and molecular gastronomy – that has no
rules beyond being tasty, fun and expensive Salon D’Ete pop-up.
– Gagnaire has remained something of an

T
anomaly in the restaurant world. He’s icon- Above: Pierre ment about Ramsay but I don’t have any That’s in part why society broke down HE summer is normally a time when
oclastic yet serious; playful yet utterly Gagnaire, 60. Above sympathy for him. Let’s put it this way: I’ve recently – there just wasn’t enough care. the club scene quietens down and
grounded in tradition, famous but resolute- right: a dining room at had 10 times more offers to open restau- The same goes for cooking. For example I everyone heads off on holiday or out
ly not interested in being a TV chef. Sketch. 9 Conduit rants than the ones I have actually done. had a Sri Lankan dishwasher in Dubai who into the countryside. However, there’s a
It’s a big year for the sixty-year-old, multi- Street W1S 2XG. Before signing any contracts I ask: “Do I wanted to be a patissier and we helped that surprising amount of activity in London’s
ple Michelin-starred Gagnaire. This year, Tel: 020 7659 4500. have the right people? People I can pay well happen. clubs and bars right now and encouragingly
he’s opened in Las Vegas and Moscow (he and protect?” CITY A.M.: You’re known as the king of they’re trying harder than ever to win your
already has outposts in Asia and Dubai) and CITY A.M.: What are the next big foodie “iconoclastic” cuisine. How do you ensure loyal custom and put the fun back into club-
just this week, in St Tropez. I caught up hotspots? your food is both pleasurable and wildly bing with an array of themes and curiosities.
with him as he ate lunch at home in Paris PG: To be honest and nationalist, the cradle unique? Over the past few months there have been
with his wife and translator Sylvie. of cuisine is in Europe: France, Italy and PG: Not to be pretentious, but I am a profes- several big launches like the vintage and
Spain, where everything started. People sional. I learned my job silently for 30 rock-influenced McQueen (Steve, not
CITY A.M.: You’ve just opened in Las Vegas, trained in Europe go back to their countries years – I’ve been cooking for 47 years. For 30 Alexander) in Shoreditch and the excellent
Moscow and St Tropez. What’s the grand with that training and can express them- years I listened, watched and worked. The 80’s-tastic Maggie’s in Chelsea, complete
plan? A restaurant in every city of the selves in own local ingredients so there are opposite of what’s happening at the with Mallet’s Mallet, Rubix Cube tables and
world? talented chefs everywhere. Otherwise I moment with these young guys who are all the Iron Lady’s speeches. The Moose, behind
PG: There’s no actual plan. It’s just a ques- could say South America. about reality shows but don’t know any- Selfridges, followed not long behind with a
tion of opportunities and meeting the right CITY A.M.: Many chefs and restaurants were thing about cooking. You need to work, you funky, tongue-in-cheek refurb, hunting lodge
people. It’s about following the story with hit hard in the recession. What is the secret need to learn, you need to shut up. Then style and trendy local crowd. Just around the
partners, and, of course, there’s the attrac- to your enduring success? you make good food. Ok, we can make mis- corner, Salon D’Ete has popped up on top of
tion of the city. After all, I enjoy going to PG: There’s no secret recipe for success. You takes. It’s happened. But you correct them. the infamous and exclusive L’Equipe
Russia and St Tropez. have to give confidence to the people you CITY A.M.: Does Sketch have a special place Anglaise. Only surfacing for the summer, it
CITY A.M.: Do you love London above all? work with and remain an honest chef who in your heart? offers an exotic and smoky descent into the
PG: I love London but I don’t come for that – stays in the kitchen. I cringe when I hear PG: I met my wife there! So yes, you could decadent 1930’s where you can enjoy live
I come for the people. The bond with the the word “concept” – it rings a marketing say it has a special place in my heart. I love music, theatrical and burlesque performanc-
city follows. bell. Cuisine is anything but marketing – it it – it was the first place I opened after Paris. es in a colonial indoor garden setting, among
CITY A.M.: Do you find it difficult maintain- is a daily task that you have to feed people. The concept was totally crazy; I’d have loved real palms and climbing ivy. The option to slip
ing your standards and your vision with so The food has to be good, it has to be hot. I to do it in St Etienne [site of his first restau- down to L’Equipe to carry on till dawn adds
many outposts? Gordon Ramsay is an exam- think when people don’t take care over rant]. It’s also where I discovered English to the allure. In the last few weeks there
ple of a chef who over-extended himself. their families, colleagues and environment, culture. And after eight years I’ve finally dis- were also two notable refurbishments, with
PG: Of course it is difficult. I won’t com- they can’t produce a good plate of food. covered the English sense of humour. Morton’s members club putting extra finish-
ing touches to its Night Lounge and the
Lonsdale in Notting Hill reopening with a

Three hotpots for rooftop drinks


Bond-esq new look and Hawksmoor-influ-
enced restaurant. If that’s not enough for you
then last night saw the rebirth of 24 London
on Kingly Street as Bond. With one eye on
the private party market, the already impres-
sive wall-to-wall projection screens have
been given an even higher tech make-over

E
VEN a hint of clemency in Japanese, and entirely glam. The swish and iconic roof terrace (left). with digital touch-screen menus, the option
London weather sends roof terraces (left) are full of A herb garden gives it a natural to send virtual drinks to other club-goers
people out onto the luxe minimalist lounge feel, and the wine and snacks (surely a cheaper option) and a whole ani-
streets to try to lap up chairs and sofas, with great list is bulging with goodies; mated show if you order a bottle of Ciroc. A
a ray or two. This summer, views over Soho. The idea there’s also a restaurant. This step up from sparklers or flying dwarves if
though, we seem to have a is to sit there, nibble some is a dead cert if you want to you like to make a scene when ordering a
proper excuse to drink out- manchego and chorizo – impress. £5 cover charge. drink. If you are heading out to the country-
side. The only question is: or some sushi – as Trafalgar Square, SW1A 2TS. Tel: side, don’t despair, as you may find yourself
where? Well, banish the sun goes 020 7870 2900. falling over clubs out there too. Already this
thoughts of rammed pubs or down. 240 summer Nikki Beach was at Polo in the Park,
overly exclusive venues. Regents St, W1 BOUNDARY ROOFTOP Boujis was at Ascot, Mahiki will be at
London is now home to increas- 3BR. Tel: 0207 478 A deck with an open fireplace, a 48- Henley this weekend, Aura will be at the
ing numbers of delightful terraces 0540. seat grill restaurant and a garden Grand Prix Ball and Grand Prix Lounge and of
on which to have a tipple. Here are three designed by Nicola Lesbirel serves up course Chinawhite, who started it all, will
of the best. VISTA AT THE TRAFALGAR 360-degree views from Canary Wharf to be center stage at the Cartier Polo.
HOTEL the Gherkin. The space has large sail-like Tim Badham is the MD and founder of
AQUA TERRACES Big Ben, The London Eye, canopy, heating, festoon lighting and Innerplace, London’s leading entertainment
Aqua was a blazing newcomer to the Parliament and Nelson are Welsh blankets. 2-4 Boundary Street, E2 and lifestyle specialists. Membership from
restaurant scene; part Spanish, part all part of the view from this 7DD. Tel: 020 7729 1051. Zoe Strimpel £40 per month. www.innerplace.co.uk
24 Lifestyle | TV& Games CITYA.M. 1 JULY 2010

BBC1 BBC2 ITV1 CHANNEL4 FIVE


TERRESTRIAL
6pm BBC News
6.30pm BBC London News
5.50pm Wimbledon 2010:
Further live coverage on day 10
6pm London Tonight
6.30pm ITV News
6pm The Simpsons
6.30pm Hollyoaks
6pm Home and Away
6.25pm Live from Studio Five:
TV PICK
7pm The Fox Attack Twins at the All England Club. 7pm Emmerdale 7pm Channel 4 News Topical reports.
7.30pm CHOICE EastEnders: 8pm Today at Wimbledon: 7.30pm How to Beat the 8pm Location, Location, 7.30pm Fifth Gear: Five News
BBC News Highlights of the ladies’ singles Budget Airlines: Tonight Location: Kirstie and Phil search Update
8pm DIY SOS semi-finals. 8pm Emmerdale for homes in Cambridgeshire. 8pm Oil Disaster: The Rig That
9pm Holby City 9pm Gareth Malone Goes to 8.30pm CHOICE Coronation Last in the series. Blew Up: Five News at 9
10pm BBC News Glyndebourne: The big night Street 9pm CHOICE The Untold 9pm FILM Cleaner: Premiere.
10.25pm Regional News arrives as the chorus takes to 9pm Homes from Hell Invasion of Britain Crime thriller, starring Samuel
10.35pm Question Time the stage. Last in the series. 10pm ITV News at Ten 10pm Big Brother: Coverage of L Jackson, Ed Harris and Eva
11.35pm This Week: Holiday 10pm Mock the Week 10.30pm London News events from the final series of Mendes. 2007. EASTENDERS
Weatherview 10.30pm Newsnight: Weather 10.35pm World Cup Rock ‘n’ Goal
the show. 10.50pm Police Interceptors BBC1, 7.30PM
11.20pm A Culture Show Years 11.05pm Superhuman: Super As a forensics team sets up a tent
12.25am Sign Zone: Countryfile Strong 12.05am Grimefighters 11.15pm Skins 11.50pm Cops in Crisis:
1.25am Sign Zone: Cracking Special – BBC Samuel Johnson 12.15am Dirty Sexy Money 12.10am SuperCasino around the gardens, Lucas knows he
12.30am The Zone: Shopping and
Antiques 1.55am Sign Zone: Put Prize for Non-Fiction interactive gaming; ITV News 1.05am Big Brother: Live 4.05am 4.05am Red Bull Air Race has run out of options and decides to
Your Money Where Your Mouth Is 12.20am What Makes a Great Headlines 2.35am The Jeremy Kyle Unreported World 4.30am 3 Magazine Show 4.55am County confess everything to Denise.
2.55am Sign Zone: Put Your Money Tenor? Show 3.35am How to Beat the Minute Wonder: A Motorway Story Secrets 5.10am The New Tomorrow
Where Your Mouth Is 3.50am 1.20am BBC News 4.20am-6am Budget Airlines: Tonight 3.55am- 4.35am Win My Wage 5.20am- 5.35am-6am Michaela’s Wild
Panorama 4.20am-6am BBC News Close 5.30am ITV Nightscreen 6.05am Countdown Challenge

SKY SPORTS 1 SKY SPORTS 3 Anatomy 10pm Private Practice 9.30pm How I Met Your Planet 4.40am World War Two
SATELLITE & CABLE

7pm Live Twenty20 Cup 7pm Live PGA Tour Golf 11pm 11pm Criminal Minds 12am CSI: Mother 10pm Accidentally on in HD Colour 5.30am-6am How
Cricket: Hampshire Royals v Ladies European Tour Golf 12am Crime Scene Investigation 2am Purpose 10.30pm Alan Carr: Does That Work?
Glamorgan Dragons. 10pm European Tour Golf 1.30am Exposed: Angelina Jolie 3am Chatty Man 11.25pm Important
World Cup Report 10.30pm Golfing World 2.30am-3.30am The Fresh Prince of Bel-Air Things with Demetri Martin DISCOVERY HOME &
Football’s Greatest 11pm Time Ladies European Tour Golf 3.50am Maury 4.40am Nothing 11.50pm-6am Big Brother: Live HEALTH
of Our Lives 12am Football’s to Declare 5.30am-6am Home 7pm Baby Tales 8pm Jon CORONATION STREET
Greatest 12.30am Women’s BRITISH EUROSPORT Shopping HISTORY and Kate Plus 8 9pm Hospital ITV1, 8.30PM
7pm Eurosport Flash 7.05pm 7pm How the Earth Was Made David sets about trying to undermine
International Twenty20 Cricket BBC THREE 10pm Hospital Emergency
Soccer City Live 7.40pm 8pm Ancient Discoveries 9pm
1.30am Twenty20 Cup Cricket 11pm Dr G: Medical Examiner Tina’s relationship with Graeme, while
Eurosport Flash 7.45pm 7pm Top Gear 8pm Undercover Warriors: Cortes 10pm Egypt
2.30am Football’s Greatest 3am Princesses 9pm Big Meets 11pm Ancient Apocalypse 12am 12am Hospital 1am Hospital Lloyd suspects Cheryl’s marriage is not
Premier League World 3.30am Triathlon 8.45pm Fight Club Emergency 2am Dr G: Medical entirely happy.
10.30pm Soccer City 11pm Bigger 10pm EastEnders Ancient Discoveries 1am How
Women’s International 10.30pm Lee Nelson’s Well the Earth Was Made 2am Egypt Examiner 3am Jon and Kate
Cycling: Tour de France 12am- Plus 8 4am Baby Tales 5am-
Twenty20 Cricket 4.30am Good Show: Nan performs her 3am Hotel Ground Zero 4am-
12.30am Soccer City 6am Mum’s the Word
Twenty20 Cup Cricket 5.30am- version of a Dizzee Rascal hit. 5am Decoding the Past
6am Football’s Greatest ESPN 11pm Family Guy 11.45pm
SKY1
7pm Press Pass 2010 8pm NBA Peckham Finishing School for DISCOVERY
SKY SPORTS 2 Classics 10pm MMA Live Girls 12.45am Big Meets Bigger 7pm Iceman: The Lewis Gordon 7pm The Simpsons 8pm
7pm NRL Fulltime 7.30pm Live 10.45pm Talk of the Terrace 1.45am Lee Nelson’s Well Good Pugh Story 8pm How Do They The Real A&E: A casualty
Championship Rugby League: 11pm South Africa Nightly Show 2.15am Undercover Do It? 8.30pm How It’s Made department. 8.30pm Real Filth
Whitehaven RLFC v Widnes 11.30pm Ultimate Fighting Princesses 3.15am Who Is 9pm Venom Hunter with Donald Fighters 9pm A League of Their
Vikings (Kick-off 7.30pm). Championship 12.30am Press Nelson Mandela? 4.15am- Schultz 10pm Man vs Fish with Own 9.30pm Modern Family
9.30pm Super League’s Pass 2010 1.30am-5.30am 5.15am Peckham Finishing Matt Watson 11pm World’s 10pm Lie to Me 11pm NCIS: Los THE UNTOLD INVASION OF BRITAIN
Supermen 10pm WWE: Late Ultimate Fighting Championship School for Girls Toughest Tribes 12am Deadliest Angeles 12am Oops TV 1am The CHANNEL 4, 9.00PM
Night – Raw 12am WWE: NXT Catch 1am Bear Grylls: Born Real World: Key West 1.50am Documentary using animated sequences
1am NRL Fulltime 1.30am- LIVING E4 Survivor 2am Chris Barrie’s Road Wars 3.30am 24 4.20am to examine the legacy of Septimius
3.30am Championship Rugby 7pm Celebrity Four Weddings 7pm Hollyoaks 7.30pm Friends Massive Engines 3am Extreme Tru Calling 5.10am Sell Me the Severus, an African who seized Rome’s
League 8pm Cougar Town 9pm Grey’s 9pm The Big Bang Theory Engineering 3.50am Raging Answer 5.35am-6am Oops TV Imperial throne. Last in the series.

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

QUICK CROSSWORD
   

SUDOKU KAKURO
12 33 45 24 16 16 14 
21 15 8
13  
23 10
Place the numbers from 1 to 9 in each empty cell so that each 45  
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 30 12
6 11 17
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 6 35

above or to the left of it.
You can only use the digits 1-9 22 18 
    and you must not use the
9
8 4  
same digit twice in a block. 11 15 24 17 9
The same digit may occur 34 23 

     more than once in a row or


column, but it must be in a
15
14
10

5 11
     separate block.
9 3 11 
7 37
 
6 7 7

     ACROSS DOWN
1 Fertilised plant 1 One employed to
    
WORDWHEEL R A
ovules (5)
4 Novel, fresh (3)
make written copies
of documents (6)
2 General conscious
Using only the letters in the Wordwheel, you have 6 Fill with optimism (5)
    ten minutes to find as many words as possible,
C I 7 Thick sap from
awareness (5)
3 Bear, convey (5)
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters A a tree (5)
9 Elongate (7)
4 Putting things
LAST ISSUE’S or more, all must contain the central letter and
letters can only be used once in every word. There
N T 11 Courage, heroism (7)
in order (9)

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


E S 13 Work done by a
5 Clean with soap
and water (4)
person or group that
QUICK CROSSWORD 1 6 2 4 7 2 9 benefits another (7)
8 Ocean-going (9)

& 5 8 0 % 0 ( $ 1 6
6 9 4 8 9 6 8 7 SUDOKU          15 Discolour, usually with
10 Attempts (5)
8 1 4 3 1 7 2         
/ 6 $ % $ 3 ,
1 5 1 2 3 5 1 use or wear (7) 12 Niche or alcove (6)
, 6 $ $ & 5 8 , 1 6         
0 8 * . & 1 6 2 3 7 4 6 1 16 Bird of prey (5) 13 The faculty of vision (5)
        
% 5 ( $ ' 7 + * 8 < 5 7 9 3 8 2 1 4 6
        
/
*
( $
5
$
,
1 2
3
7 + ( 5
4 3 8
5 7 6 4 9 8
9 5 7 9
WORDWHEEL         
17 Prime minister of India
from 1947 to 1964 (5)
14 Watery discharge from
the eyes or nose (5)
, ) 8 1 2 1 (         
6 7 , 1 * ( 5 2 ' ( 6 5 7 9 3 1 3 The nine-letter word 18 Impenetrable mist (3) 15 Quarrel about
2 1 4 3 2 3 6 1         
7 5 + , 6 + 9
was LOCALISED          petty points (4)
6 / ( 3 7 6 & $ / ( 2 9 8 1 9 8 3 19 Repairs (5)
Sport
25
ROGER AND OUT
FEDERER’S WIMBLEDON OVER AFTER
SHOCK LOSS TO BERDYCH: PAGE 26

Results
Aussies fight CRICKET
FOURTH ONE DAY INTERNATIONAL
England v Australia
BRIT INSURANCE OVAL: Australia beat England by 78 runs

back to save
AUSTRALIA
S Watson c Morgan b Swann ..................................................................41
T Paine c Morgan b Bresnan ......................................................................8
R Ponting c Strauss b Anderson ............................................................92
M Clarke not out............................................................................................99
C White c Anderson b Broad....................................................................17
M Hussey run out..............................................................................................1
S Smith not out ..............................................................................................18

face at Oval
B3 lb2 w9 ..............................................................................................14
Total (5 wkts., 50 overs) ............................................................290
Fall: 33, 73, 228, 263, 266.
Bowling: Anderson 10-1-66-1, Bresnan 9-1-52-1, Broad 10-0-
46-1, Yardy 9-0-49-0, Swann 6-0-31-1, Wright 3-0-14-0,
Collingwood 3-0-27-0.
ENGLAND
A Strauss c Paine b Tait..............................................................................37
C Kieswetter b Harris ..................................................................................12
and if not par then only just above a K Pietersen lbw Harris ..................................................................................8

CRICKET P Collingwood lbw Smith ..........................................................................15


BY FRANK DALLERES par score. E Morgan c Paine b Harris ........................................................................47
“But with our batting we reverted M Yardy c White b Bollinger....................................................................57
ENGLAND captain Andrew Strauss to old habits. We lost too many wick- L Wright b Smith..............................................................................................2
T Bresnan c Watson b Harris ..................................................................22
lamented his team’s complacency ets too early and then a few in the G Swann c Paine b Bollinger........................................................................1
after suffering a 78-run defeat to middle to leave us with too much to S Broad c Hussey b Harris............................................................................4
Australia in the fourth one-day inter- do. J Anderson not out ........................................................................................0
B1 lb3 w3 ..................................................................................................7
national that ruined hopes of a series “Even at the halfway mark we Total (42.4 overs) ............................................................................212
whitewash. thought we had a chance. It was a Fall: 37, 53, 61, 90, 140, 151, 199, 207, 208.
A 155-run stand between Michael fairly flat wicket, but we didn’t take Bowling: Tait 7-2-23-1, Bollinger 8-0-38-2, Harris 8.4-1-32-5,
Clarke (99 not out) and Ricky Ponting advantage of the first 15 overs and Hopes 10-0-56-0, Smith 9-0-59-2.
Umpires: A Dar & R Kettleborough.
(92) propelled Australia towards a lost wickets. LV COUNTY CHAMPIONSHIP - Division One: Durham v
commanding total of 290-5 at The “It was a disappointing day, but Warwickshire (Emirates Durham ICG); Durham 288 and 289
Oval. you have to put it in the context of v Warwickshire 224 and 111-3 (38.0 overs). Yorkshire v
And England failed to shine with the series and we have had a lot of Lancashire (Old Trafford); Yorkshire 447 and 111-3 (41.0
overs) v Lancashire 358.
the bat, the tourists dismissing them good days so far.” Division Two: Middlesex v Gloucestershire (Bristol);
for 212 in only 42.4 overs, despite Fast-bowler Ryan Harris did the Middlesex 236 and 228 v Gloucestershire 420 and 45-0.
Michael Yardy’s maiden half-century damage for Australia, taking the first Gloucestershire (23pts) beat Middlesex (3pts) by 10 wickets.
Worcestershire v Leicestershire (New Road); Worcestershire
at this level. two wickets of Craig Kieswetter (12) 175 and 315 v Leicestershire 309 and 182-3. Leicestershire
The hosts’ loss brought them back and Kevin Pietersen (8) in the space of (22pts) beat Worcestershire (3pts) by 7 wickets. Surrey v
down to earth, after victories in the six balls and finishing with figures of Derbyshire (Chesterfield); Surrey 391 and 253 v Derbyshire
237 and 136-1 (35.0 overs).
first three ODIs had earned them an 5-32.
unassailable lead. Aussie captain Ponting, who TENNIS
And Strauss blamed a poor start to became only the third man to pass ALL ENGLAND LAWN TENNIS CHAMPIONSHIPS
their innings that saw them slip to 13,000 runs in this format, toasted his (Wimbledon, England)—M Men’s Singles Quarter-final: (12) T
151-6. team’s welcome return to form. Berdych (Cze) bt (1) R Federer (Swi) 6-4 3-6 6-1 6-4, (3) N
“It was not so good today. We got “At long last,” he said. “We played a Djokovic (Ser) bt Y Lu (Tpe) 6-3 6-2 6-2, (4) A Murray (Gbr)
bt (10) J Tsonga (Fra) 6-7 (5-7) 7-6 (7-5) 6-2 6-2, (2) R Nadal
off to a good start with the ball but lot better today. Our batting was back (Spa) bt (6) R Soderling (Swe) 3-6 6-3 7-6 (7-4) 6-1.
fair play to Clarke and Ponting,” said to the level it needs to be. We con-
the Middlesex man. trolled the game right through today SPORTS EDITOR JON COUCH
“We thought that 290 was chasable I thought.” Ponting passed 13,000 one-day runs with his 92. Picture: ACTION IMAGES email sport@cityam.com

Lion king Geech returns to


take director role at Bath
achieve long-term success and returned to the English top-flight

RUGBY UNION
become one of the strongest clubs last season to work in an advisory
BRITISH LIONS legend Sir Ian in Europe,” said McGeechan, who role at Gloucester, but is now back
McGeechan is back in the led the Lions on four occasions. with a hands-on coaching role in a
Premiership after agreeing to “I am really looking forward to bid to lead Bath to a first major tro-
become performance director at working with Steve Meehan, Martin phy since the 1998 Heineken Cup.
Bath. Haag and Brad Davis as well as the “As part of our continued com-
The 63-year-old has been out of academy and the strength and con- mitment to the success of Bath
the game since leaving Wasps after ditioning teams to assist wherever I rugby, we are delighted that Sir Ian
the 2009 Lions tour, but has now can to ensure that this squad and will be joining us,” said the club’s
signed a two-year-deal with the club continues to grow from new owner Bruce Craig.
Recreation Ground club, to work strength to strength.” “His contribution to rugby union
alongside head coach Steve Meehan. McGeechan won the Premiership, is unrivalled and he has been at the
“I am delighted to become part of Heineken Cup and Anglo-Welsh forefront of rugby development for
a club that is developing the infra- Cup during his successful four-year many years now – really, he needs
structure on and off the pitch to spell in charge at Wasps. He briefly no introduction.”

SPORT | IN BRIEF
Westwood in blood clot scare Tigers wary of opening games Howard ICC role bid thwarted
GOLF: England’s Lee Westwood is still RUGBY UNION: Leicester boss Richard CRICKET: Former Australian Prime
hopeful of playing in the French Open, Cockerill has warned his team that Minister John Howard has been
which starts today, despite a blood clot they have been handed a tough start to snubbed in his bid to be vice-president
scare. their Premiership title defence. of the International Cricket Council.
The world No3 pulled out of yester- The champions kick off the new An Australasian candidate is due to
day’s pro-am in order to see a doctor campaign with games against take up the presidency in 2012, and
about his swollen right calf and ankle, Northampton, Exeter, Wasps, Leeds Howard saw the No2 job as a stepping
sparking fears he could miss next and Saracens. stone to the top role.
month’s Open. Tigers coach Cockerill said: “It’s just But the ICC has told Australia’s and
But Westwood was reassured when important we have a good start with New Zealand’s cricket chiefs to nomi-
tests ruled out a blood clot or deep vein Saints away. It’ll be an interesting local nate someone else as Howard “did not
thrombosis, with medics blaming a derby. It’s a tough start, those first five have sufficient support in the ICC
severe reaction to heat. games.” board”.
26 Sport | Tennis CITYA.M. 1 JULY 2010

It’s a decent
Federer’s defeat
was his first at
Wimbledon
outside of the
final since 2002.

result, claims
Picture: GETTY

flogged Fed
WIMBLEDON defend well enough and he played
well when he had to – it was brutal
2010 for me. Every time he had a chance,
BY JON COUCH he took it.”
In contrast, Berdych, 24, played the
ROGER FEDERER saw the defence of match of his life to reach his first
his Wimbledon title come to a halt on Grand Slam semi-final and become
Centre Court yesterday, but insisted: the first Czech player to reach the last
“It’s a decent result.” four at Wimbledon since Ivan Lendl
The Swiss top seed went down 6-4, in 1990.
3-6, 6-1, 6-4 to 12th seed Tomas “It’s really tough to explain how
Berdych – his first defeat before the I’m feeling, it’s unbelievable,”
final at SW19 since 2002. Berdych said. “To play on this stadi-
Federer cited a back and thigh um against a player as great as Roger
injury, picked up at the pre-tourna- and to be standing here as the winner
ment grass-court event in Halle, is amazing.
Germany, as a contributing factor to “This was the toughest match of
this defeat, which will now see him my career to close out, it’s a big step
drop to No3 in the world rankings for forward and I’m so happy.
the first time since November 2003. “Right now it’s really tough to
Indeed, the 15-time Grand Slam think about my next match – I just

Exclusive football content on Yahoo!


winner insists he was satisfied with want a few minutes and hours to
his Wimbledon campaign as a whole enjoy this. Then I have to get ready
and has vowed to bounce back for the and prepare for my next opponent.”

From a man who knows a bit about football.


US Open in September. Berdych now takes on third seed
“I’m definitely struggling at the Novak Djokovic in the semi-final after
moment,” he said. “I’m looking for- the Serbian cruised past Andy
ward to a rest and then I’ll attack Roddick’s conqueror, Yen-Hsun Lu, 6-3,
again in North America. 6-2, 6-2.
“Reaching the quarter-finals is a
decent result. Obviously some people MEN’S SINGLES | SEMI-FINALS
think it’s shocking, but many players
would die to play a Grand Slam quar- T Berdych (Cze) (12) v N Djokovic (Ser) (3)
ter-final. I don’t think I played poorly R Nadal (Spa) (2) v A Murray (GBR) (4)
but he went after it. I was not able to

Murray comeback
sets up Nadal semi
WIMBLEDON contested first set on the tie-break.
Australian Open finalist Murray hit
2010 back with an early break in the sec-
BY FRANK DALLERES ond set, but allowed Tsonga to do like-
wise and needed all his fighting
BRITISH No1 Andy Murray insists he qualities to edge the eventual tie-
is relishing the prospect of facing old break.
adversary Rafael Nadal after battling It proved to be something of a turn-
his way into a second successive ing point, and when Murray earned
Wimbledon semi-final. the first of two breaks in the third,
Fourth seed Murray showed his the Centre Court crowd began to
trademark grit to recover from losing sense there would only be one win-
the first set against Jo-Wilfried Tsonga ner. Having snared the third set in
and beat the Frenchman 6-7 (5-7), 7-6 ruthless fashion, Murray was similar-
(7-5), 6-2, 6-2. ly clinical in taking the fourth and
Victory thrust the Scot into a wrapping up his first comeback tri-
fourth Grand Slam semi-final and umph of this year’s competition.
kept alive his dream of becoming “It was really tough,” Murray
Britain’s first winner of a major tour- added. “The first couple of sets, we
nament since Fred Perry in 1936. both had chances and neither of us
Second seed Nadal, his friend and could take them so we had the tie-
former junior rival, stands between breaks. I was having to do a lot of
him and a place in Sunday’s final, but defending, but I played very well the
Murray is optimistic about his last couple of sets.”
chances of upsetting the odds and Nadal, meanwhile, continued his
defeating the musclebound shaky form by losing the first set
Mallorcan. before beating Swedish sixth seed
“It’ll be a great match,” said the 23- Robin Soderling 3-6, 6-3, 7-6 (7-4), 6-1.
year-old from Dunblane. “It’s always
fun playing against him. We’ve played
four times in Slams and it’s 2-2 so I’ll
ORDER OF PLAY | TODAY Make Yahoo! your home for football.
look forward to it.” CENTRE COURT yahoo.co.uk
Murray had not dropped a set on
his way to the quarter-finals, so found V Zvonareva (Rus) (21) v T Pironkova (Bul)
himself in unfamiliar territory when S Williams (USA) (1) v P Kvitova (Cze)
10th seed Tsonga snatched a closely
CITYA.M. 1 JULY 2010 Sport | Football 27

Imperious Brazil are going through the gears


someone forgot to tell the birthday silent assassins in this tournament. Similarly, Argentina, under it’s asking a lot of them to deal with
boy. No-one can argue that England I must admit, I questioned the Diego Maradona, left, have been the pressure in the latter stages of the
deserve to be in the final eight given solidity of their defence at the a joy to watch. His atti- competition.
the way they performed, so thoughts start of the tournament, but tude, enthusiasm and Spain, however, have disappointed
turn now to those who do, and their the likes of Johnny leadership has been me. They rely too heavily on David
respective quarter-final matches, Heitinga, Giovanni van mirrored by the team Villa, while Fernando Torres looks to
which get underway tomorrow. Bronckhorst and goalkeep- and they’ve won have caught the Wayne Rooney dis-
Unsurprisingly, the overwhelming er Maarten Stekelenburg every game they’ve ease, clearly not as fit as we are led to
OUR MAN IN SOUTH AFRICA favourites are Brazil, who looked have put in some sterling played as a result. believe, and almost over-affected by
mightily impressive against Chile on displays. It was suggested the pre-tournament hype.
TREVOR STEVEN Monday. They seemed to find a
fourth, fifth, then sixth gear, and
Sure, they will need to
be on their game against
that they would strug-
gle against Germany in
The Spanish looked far more
threatening when they brought on

W
ITH England disgraced and showed why it will take an outstand- the Brazilians, but with Arjen the quarter-final after Joseba Llorente for Torres against
back on home soil, it’s left a ing performance to prevent them lift- Robben back and Robin van their demolition of Portugal on Tuesday night, and
strange feeling here in South ing the trophy for a sixth time. Persie looking to prove a England, but I just Vicente del Bosque has a big decision
Africa – almost like you’ve That said, they will have to play well point, they are a dangerous think, with so many to make for Saturday night’s last-
been invited to a surprise party and to beat a Dutch side, who are like the proposition. inexperienced players, eight game with Paraguay.

SILVA LINING FOR CITY

MANCHESTER CITY boss Roberto Mancini insists the £25m signing of David Silva is a
major statement of the club’s intent. The coveted Spanish international winger joins City
from Valencia on a four-year deal after the World Cup, and Mancini said: “In signing
David, we are showing the world that we are bringing the best players here and that we
hope to compete to win the Premier League.” Picture: PA

Muller blasts
England flops
WORLD CUP alpha males. It is difficult to have so
many alpha males and have them
2010 row in the same direction,” said the
BY FRANK DALLERES Bayern Munich midfielder.
“You don’t only need only chiefs,
GERMANY star Thomas Muller, whose you also need a few Indians. You need
two goals helped send England tum- people who are ready and willing to
bling out of the World Cup in dis- do the hard work. It may be a prob-
grace, believes Fabio Capello’s side lem with England that players are
floundered because they have too simply not mentally prepared to go
many “alpha males”. that extra mile for their team-mates.”
England’s wretched and short-lived Muller’s comments come as
campaign in South Africa was dogged England chiefs mull over Capello’s
by rumours of unrest in the camp, future, although there are increasing
with midfielder Joe Cole since admit- suggestions that the Italian will be
ting there were “issues” that need to allowed to see out the remaining two
be addressed. years of his contract.
And Muller has reinforced that feel- Bolton chairman Phil Gartside, an
ing by painting a bleak picture of influential member of the Football
England – beaten 4-1 by Germany in Association board and a close ally of
Sunday’s second-round clash – as Club England chairman Sir Dave
being psychologically flawed and Richards, has already backed Capello
lacking a team ethic. to keep his job.
“England have so many top stars in It is also thought that Sir Trevor
their squad that they will always be Brooking, the FA’s development chief
part and parcel of the international and another key player, would prefer
football scene. But there are so many to retain the former Real Madrid boss.
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