Monday newspaper round-up: Barclays,
JJB Sports, National Express
Mon 12 Oct 2009
LONDON (SHARECAST) - Barclays is planning to spin off a £4bn portfolio of complex credit assets as the bank presses ahead with a process to clean up its balance sheet and ease shareholder concerns over its investments.
The bank is looking at a deal to shift up to £4bn of the assets off its balance sheet in an echo of a similar transaction it undertook last month with a £12.3bn portfolio, people familiar with the matter said. That deal involved a team of 45 Barclays staff, led by Stephen King, head of principal mortgage trading, leaving the bank, the FT reports.
A fire sale of public assets will be announced by Gordon Brown today to help cut the Government's mounting deficit. The Tote, the Dartford crossing, the student loan book, the Channel Tunnel rail link and the Government's stake in Urenco, which enriches uranium for nuclear power stations worldwide, will all be offered to private bidders in the next two years, in an attempt to raise £3bn, the Independent reports.
A funding package worth up to £1bn to help Britain to build the world’s first “clean coal” power station could be delayed by the Government after E.ON’s decision to freeze plans for a new coal plant at Kingsnorth in Kent for up to three years. In an interview with The Times, Paul Golby, the chief executive of E.ON UK, said that the Government had agreed to retain Kingsnorth in a competition for the funding, even though it would now be impossible for the project to meet a key deadline.
The embattled retailer JJB Sports last night insisted that its plans for a £100m cash call were "back on track" after a weekend of turmoil thanks to lurid – and false – reports about its chairman's finances that swept through the City. The cash call – suspended on Friday – could be relaunched as soon as today as the company's brokers worked furiously to shore up support, which was shaken by the rumours that began to spread on Thursday night, the Independent reports.
General Motors is increasingly concerned about the stalemate in negotiations on Opel and Vauxhall's future and has kept alive plans to keep its European operations or sell them to another party. In a sign that the deal could still collapse, GM has said it wants to see progress on talks with European governments about funding and job cuts by the end of the week, according to sources close to the talks, the Telegraph reports.
Spectacular profits and punishing losses will affect sharply the share prices of the big banks on Wall Street when they report their third-quarter figures this week. Lenders with strong share-trading businesses are expected to shine and those burdened by bad consumer and commercial loans will suffer, in what analysts term the “bifurcation” of the banking sector in the United States, the Times reports.
The Spanish-led consortium bidding for National Express is likely to ask for more time to perform due diligence before making a formal offer. The deadline for the bid, worth £765m, expires at 5pm on Friday. A Takeover Panel ruling had already extended the “put up or shut up” deadline from September 11, the FT reports.
A flagship government anti-smoking scheme that would ban Britain’s shops from displaying cigarettes would be “unenforceable”, according to one of the country’s leading QCs. However, in advice drawn up for the Tobacco Manufacturers’ Association (TMA), Lord Pannick, QC, has raised the prospect of a legal challenge, the Times reports.
British Sky Broadcasting will this month launch Sky Songs, its long-awaited digital music service designed to compete with music services such as iTunes and Spotify. The broadcaster has agreed deals with the four major music labels, EMI, Sony Music Entertainment, Universal and Warner Music, as well as a number of independent labels to access their back catalogues and new releases, the FT reports.
The Financial Services Authority has actively discouraged up to 10 European banks from establishing branches in London over fears about their stability, according to senior sources at the regulator. The FSA, which is not allowed to stop European banks from setting up shop in the City under EU law, has been placed in a difficult position as it attempts to protect British customers from vulnerable institutions, the Telegraph reports.
Citigroup is to be fined over derivatives transactions that were partly designed to help foreign clients avoid taxes on dividends in a move that could herald a wider crackdown against Wall Street banks that used similar strategies. The $600,000 fine by the Financial Industry Regulatory Authority, which oversees broker-dealers, comes after the US authorities hardened their stance on offshore tax operations with a series of actions over the past few months, the FT reports.
Blackstone, the world’s largest buy-out firm, is planning to list up to eight companies it owns and sell at least five others, marking a reversal of its pessimistic view of the global economy and financial markets. Steve Schwarzman, Blackstone’s founder, told investors in a letter sent on Friday: “We see the world changing once again. At least for private equity, the worst is behind the industry,” the FT reports.
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