FTSE 100 ▼5,041.61 -246.80 DOW ▼10,733.80 -391.01 NASDAQ ▼2,455.67 -82.52 £/$ ▼1.54 -0. 01 £/¤ 1.14 unc ¤/$ 1.35 unc www.cityam.com Issue 1,474 Friday 23 September 2011 FREE BUSINESS WITH PERSONALITY Certified Distribution 01/08/11 till 28/08/11 is 92,745 BLOODBATH Gold down 2.3% Dow Jones down 3.51% Nikkei down 2.07% Hang Seng down 4.85% US 30-year Treasuries up four points Euro Stoxx 50 down 4.9% FTSE 100 down 4.67% DAX down 4.96% Silver down 9.3% Copper down 7 .5% WTI Crude oil down 5.5% Equities and commodities plunge on fears over global reco very A FRANTIC sell-off saw stockmarkets tumble yesterday while commodities collapsed, as spooked investors retreated from mounting signs of global economic weakness. The world economy is “in a danger zone”, World Bank chiefRobert Zoellick said yesterday, while International MonetaryFund (IMF) boss Christine Lagarde again said that the path to recovery is “narrowing”. At the G20 summit in Cannes, six world leaders including Prime Minister David Cameron warned: “External risks to the stability of our banks and our economies are reaching pre-cri- sis levels.” In an open letter to President Sarkozy, the six called for Eurozone countries to “act swiftly to resolve the crisis”. German, French, Spanish and Italian credit default swaps (CDS) all hit new highs yesterdayas market gloom deepened and concern over the ability ofEurozone governments to paytheir debts continued to mount. Their comments followed a bearish statement from the US Federal Reserve on Wednesdaynight, during which it launched its latest effort to stimulate the economy – “Operation Twist”. Over two per cent was lost from equities from various cor- ners of the world yesterday, according to the MSCI AC World Index. The Dow Jones closed down 3.51 per cent, the FTSE lost 4.7 per cent and merging mar- kets stocks slid 6.5 per cent “It’s a combination of no QE3, low economic growth, China’s PMI falling and European PMI data either slightly or widelybelow expectations,” said analyst Thorbjorn Bak Jensen of A/S Global Risk Management. The gloomy outlook for the world economy weighed on commodities, with investors concerned that a stuttering recovery will hammer demand for energy and metals. China’s factory sector shrankfor a third consecutive month in September, on sagging demand. WTI crude oil sank around 5.5 per cent yesterday, while copper – often seen as a bellwether ofindustrial activit y and the wider economy – fell off a cliff, losing 7.5 per cent in London trading. Even gold and silver, often seen as safe havens at times when equities take a bath, crum- bled under the pressure of a ris- ing dollar, although gold later recover ed some losses. The dollar index rose to seven- month highs after the Fed’s Operation Twist. The twist heightened the appeal of short- er-dated US debt and gave the greenback’s yield-appeal an edge over that of other currencies, which in turn hit gold. With few places to run, some investors turned to supposedlysafe-haven bonds. Yields on 30- year Treasuries fell by seven per cent, touching as low as 2.76 per cent as prices rose. FORUM: P20; ALLISTER HEATH: P2 BY JULIAN HARRIS, TIM WALLACE WORLD ECONOMY ▲ World leaders (Lagarde, Zoellick, Cameron) painted a gloomy picture for global growth
www.cityam.comIssue 1,474 Friday 23 September 2011 FREEBUSINESS WITH PERSONALITY
Certified Distribution
01/08/11 till 28/08/11 is 92,745
BLOODBATHGolddown 2.3%
Dow Jonesdown 3.51%
Nikkeidown 2.07%
Hang Sengdown 4.85%
US 30-yearTreasuriesup four points
Euro Stoxx 50down 4.9%
FTSE 100down 4.67%
DAXdown 4.96%
Silverdown 9.3%
Copperdown 7.5%
WTI Crude oildown 5.5%
Equities and commodities plunge on fears over global recovery
A FRANTIC sell-off saw stock markets tumble yesterday whilecommodities collapsed, asspooked investors retreatedfrom mounting signs of globaleconomic weakness.
The world economy is “in adanger zone”, World Bank chief Robert Zoellick said yesterday,
while International Monetary Fund (IMF) boss ChristineLagarde again said that the pathto recovery is “narrowing”.
At the G20 summit in Cannes,six world leaders includingPrime Minister David Cameron
warned: “External risks to thestability of our banks and oureconomies are reaching pre-cri-sis levels.” In an open letter toPresident Sarkozy, the six calledfor Eurozone countries to “actswiftly to resolve the crisis”.
German, French, Spanish andItalian credit default swaps(CDS) all hit new highs yesterday as market gloom deepened andconcern over the ability of Eurozone governments to pay their debts continued to mount.
Their comments followed a bearish statement from the USFederal Reserve on Wednesday night, during which it launchedits latest effort to stimulate theeconomy – “Operation Twist”.
Over two per cent was lostfrom equities from various cor-ners of the world yesterday,according to the MSCI AC WorldIndex. The Dow Jones closed
down 3.51 per cent, the FTSE lost
4.7 per cent and merging mar-kets stocks slid 6.5 per cent
“It’s a combination of no QE3,low economic growth, China’sPMI falling and European PMIdata either slightly or widely
below expectations,” said analyst Thorbjorn Bak Jensen of A/SGlobal Risk Management.
The gloomy outlook for the world economy weighed oncommodities, with investorsconcerned that a stutteringrecovery will hammer demandfor energy and metals.
China’s factory sector shrank for a third consecutive month inSeptember, on sagging demand.
WTI crude oil sank around 5.5per cent yesterday, while copper– often seen as a bellwether of industrial activity and the widereconomy – fell off a cliff, losing7.5 per cent in London trading.
Even gold and silver, oftenseen as safe havens at times
when equities take a bath, crum- bled under the pressure of a ris-ing dollar, although gold laterrecovered some losses.
The dollar index rose to seven-month highs after the Fed’sOperation Twist. The twistheightened the appeal of short-er-dated US debt and gave thegreenback’s yield-appeal an edgeover that of other currencies,
which in turn hit gold. With few places to run, some
investors turned to supposedly safe-haven bonds. Yields on 30-
year Treasuries fell by seven percent, touching as low as 2.76 percent as prices rose. FORUM: P20;
ALLISTER HEATH: P2
BY JULIAN HARRIS, TIM WALLACE
WORLD ECONOMY▲
World leaders (Lagarde, Zoellick, Cameron) painted a gloomy picture for global growth
THE US futures regulator has yieldedon several contentious parts of aplan to crack down on commodity speculation, marking a victory for
banks and traders who have lobbiedto limit increased market oversight.
A draft of the final rule by theCommodity Futures TradingCommission maintains that theDodd-Frank Act requires positionlimits -- caps on the number of con-tracts a single trader can hold -- toprevent excessive speculation in oil,grain, silver and other commodity markets.
But the CFTC modified areas of the plan that were a major concernfor big banks like Morgan Stanley and firms like Shell, including
whether or not different arms of a
single company must count sepa-rately managed positions as one, and
whether swaps and futures positionscan be offset.
While sticking to an unpopularplan to phase in limits over time asthe agency gathers more data on theopaque $600 trillion over-the-count-er derivatives market, the proposal isthe latest sign that regulators are atleast partly responding to cries fromthe financial industry -- as well asRepublicans -- that overly toughrules may have a detrimentalimpact.
BYHARRY BANKS
REGULATION▲
EU TO SPEED RECAPITALISATION OF 16BANKSEuropean officials look set to speed upplans to recapitalise the 16 banks thatcame close to failing last summer’span-EU stress tests as part of a co-ordi-nated effort to reassure the marketsabout the strength of the 27-nation
bloc’s banking sector. A senior Frenchofficial said the 16 banks regarded to
be close to the threshold would now have to seek new funds immediately
US FUNDS SLASH EXPOSURE TOEUROPEAN BANKS
The biggest US money market fundshave slashed their exposure toEurope’s embattled banking sector tothe lowest since at least 2006, under-lining the spreading nervousnessabout the Eurozone’s indebted periph-ery. The 10 largest US money market
funds reduced their short-term lend-ing to European banks to just
$284.6bn by the end of August, or 42.1per cent of their total assets.
FUNDING FEARS HIT CHINESE PROPERTYSTOCKSChinese property stocks suffered dou-
ble-digit declines amid growing fearsdevelopers are losing access to fundingand will be forced to slash prices. Thetrigger for yesterday’s tumble was aReuters report that the Chinese bank-ing regulator had ordered trust com-panies to assess their risks fromlending to Greentown.
ALIBABA IN $1.6BN PRIVATE EQUITYDEAL
Alibaba Group employees and share-holders are set to be given the opportu-nity to cash out part of their stock inChina’s largest ecommerce group by revenues, through a $1.6bn privateequity deal. DST Global of Russia andCalifornia-based Silver Lake are lead-ing a tender offer of almost $1.6bn for
just under five per cent of Alibaba, valuing the internet group at $32bn.
YES, MINISTER: BUSINESS CHIEFS GETBUDDY HOTLINEBritain’s top 50 companies are to begiven unprecedented access to govern-ment ministers in an attempt to spark life into the economy. Bosses of compa-nies, including BP andGlaxoSmithKline, will be able to tele-phone directly to the top of Whitehalldepartments in new individually tai-lored relationships with senior minis-ters who will act as their “buddies”.
SORRELL IN LINE FOR £500,000 PAY RISE WPP is proposing to award SirMartin Sorrell, its chief executive, apay rise of up to 50 per cent, takinghis salary to £1.5m. The advertisingsupremo earns considerably morethan his £1m base salary throughthe FTSE 100 advertising group’sshare incentive scheme. Last year he
received £4.2m through a combina-tion of pay, bonuses and benefits.
HALIFAX LAUNCHES PREMIUM BONDSRIVALHalifax, Britain’s biggest savings bank,is taking on National Savings’Premium Bonds – the nation’sfavourite savings product – with thelaunch of a new monthly prize draw.Every month the bank will awardcash prizes of up to £100,000 to ran-domly selected savers.
IRAN'S MAHMOUD AHMADINEJADSPARKS UN WALKOUTIranian President Mahmoud
Ahmadinejad sparked a mass walkoutof diplomats at the UN after heattacked Western powers over theHolocaust and 9/11. The US delegation
walked out yesterday when Mr Ahmadinejad said “arrogant powers”threatened anyone who questionedthe Holocaust and the September 11
attacks on the United States withsanctions and military action.
OBAMA LEADS UN SPARRING OVERMIDDLE EASTObama implored the UN to hold off the Palestinian push for statehood,saying there can be no “shortcuts” topeace, an admonition immediately spurned by Palestinian leaders who
vowed to press ahead. However, thePalestinians also acknowledged
Wednesday that it would take time forthe Security Council to consider theirrequest.
CHILE TO KEEP BELT TIGHT, WARY OFGREECE'S PROBLEMSChilean President Sebastián Piñera,facing protests by students seekinghigher subsidies and other changes,said Thursday he sympathised withthe demands but that the governmentneeded to maintain fiscal discipline.“We agree with some of their basic
demands but we can’t meet all theconditions,” Piñera said.
WHAT THE OTHER PAPERS SAY THIS MORNING
Investors well and truly out of luck
WHAT a rout. The markets took amajor battering yesterday, in whatlooked like a belated wake-up call. TheEurozone crisis is getting worse, amajor sovereign default in the EU is
becoming closer and growth in the West is grinding to a halt. There wastalk last night that some Eurozone
banks may need to be recapitalised; if this does materialise, it would meanthat the next step of the crisis may beabout to begin.
The last few days have seen more bad economic data (including fromthe US, China and the Eurozone),
Operation Twist (which under- whelmed the QE junkies), and morepolitical nonsense, including a ridicu-lous letter from six G20 leaders callingfor action (who do they think they are
writing to? Themselves?). The FTSE 100 just kept its noseabove 5,000 but suffered its largestloss for around 30 months. US sharesslumped. Emerging market stocks fell
by the most since 2008. The Greek stock market is now down by 88 percent since its peak. Commoditiesinvestors have seen their gains of the
year more than wiped out. Oil pricesslumped, gold fell sharply, as did sil-
ver. It was a bloodbath for investors. The problem when all asset prices
move together and are correlated inthis way is that diversification nolonger works to reduce risk – standardfinancial theory becomes much lessuseful. Investors are now much moreexposed. True, they can put theirmoney in bank accounts – but withretail price index inflation at 5.2 percent, they are being slowly decimated
(and with the possibility of a Eurozonecrisis, real risk has returned to theglobal banking system).
The only asset class that is doing well is the bonds of supposedly safe
governments such as that of the US. Ten-year Treasuries are now yielding just 1.75 per cent and the 30-year 2.81per cent, which is negative in realterms and utter madness (though of course the otherwise largely uselessoperation Twist had some small effecton this). So that’s the choice: play along with an unsustainable bubbleor face immediate losses. With aver-age UK house prices also falling in realterms, no wonder investors desperateto preserve their wealth are tearingtheir hair out.
GUILTY MENFOR years, a large chunk of the Britishestablishment, including to their dis-credit some large companies and City firms, argued for Britain to join theeuro. At one point, the Confederationof British Industry was massively in
favour. Many current ministers,including Danny Alexander andKenneth Clarke, were fanatically infavour (and who knows, may even still
be). All of these people got it totally
wrong yet have escaped with their rep-utations intact. It would have been anunmitigated disaster had the UK aban-doned sterling. The bubble wouldhave been even worse and the bustfatal; the UK would have ended upanother Ireland or even Iceland.
As Peter Oborne argues in Guilty Men, a brilliant pamphlet for theCentre for Policy Studies, the strategy
was to create the impression thatthose arguing against the euro weremad, racist or xenophobic. This moraland cultural bullying almost succeed-ed. It is high time that those who gotit so wrong hid their heads in shame –and that business and the City makessure it never again backs these kindsof economically irrational, corporatistand undemocratic projects.
TESCO has kicked off a price war withrivals, announcing that it plans tosplash out £500m on dropping priceson 3,000 food items.
In an aggressive attempt to out-flank the competition, the supermar-ket giant has vowed to focus thecampaign on cheap, everyday prod-ucts and to scrap complex promo-tions in favour of across-the-boardprice changes.
Richard Brasher, the company’s UK chief executive, said: “My message toour customers in these tough times isclear – we have listened and we aregoing to help. From Monday, you will
be able to save more money everyday at Tesco on the essentials you needthe most.”
Shore Capital analysts estimatethat the price war will be “most prob-lematic” for Sainsbury’s and Ocado –the latter in particular because itpromises to match Tesco’s prices onits goods.
BY JULIET SAMUEL
RETAIL▲
Tesco kicks off price war Philip Clarke, the Tesco group chief exec, is overseeing the £500m price war Pic: REUTERS
NEWS | IN BRIEF
Facebook ties deal with SpotifyFacebook has unveiled new features thatcentre on the way users listen to musicand watch TV, offering tie-ups with thelikes of Spotify and Hulu, as it attemptsto make media an integral part of itsservice. The features, which also includeways for users to jazz up profiles in a
magazine, photo-heavy style, were intro-duced on Thursday during Facebook'sannual f8 developers' conference in SanFrancisco by Facebook chief executiveMark Zuckerberg. For Facebook, a deep-er integration of music, movies andother media into its service makes itmore likely that users will spend moretime on its site.
Private equity deals are laid lowPrivate equity-backed deal volume in thethird quarter was down nearly 30 percent to $53.1bn (£34.5bn) from thesame period of last year, according toThomson Reuters data for the threemonths to 22 September. The figure isalso 22 per cent lower compared to theprevious quarter. So far in 2011, howev-er, such deals are still up about 14 percent from a year ago to $175.2bn, thedata shows.
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Commodity FuturesTrading Commissionchair Gary Gensler hasbacked down on somespeculation rule
EditorialEditor Allister HeathDeputy Editor David HellierNews Editor David CrowActing Night Editor Marion DakersBusiness Features Editor Marc SidwellLifestyle Editor Zoe StrimpelSports Editor Frank DalleresArt Director Jo SimpsonPictures Alice HeppleCommercialSales Director Jeremy SlatteryCommercial Director Harry Owen
HEWLETT Packard last night unveiledMeg Whitman as its new chief execu-tive after sensationally axing Leo
Apotheker, who had held less the jobfor than a year.
Former eBay chief executive Whitman will be tasked withhalting the decline in the firm’sshare price, which has tanked50 per cent in the last twelvemonths.
The board is understood to
have lost faith in Apothekerafter he was forced to issue astring of profit warnings, as
well as struggling to live upto promises to integraterecently acquired Palm’s
webOS software into itsdevices.
Whitman will now decide whether to forge ahead with Apotheker’s radical plans tospin off HP’s huge personalcomputing division and
refocus its operations as a softwarecompany.
Some HP investors are also said to beirked over the $10bn price tagattached to Autonomy, which it agreedto buy last month.
However, City A.M. understands it would be almost impossible for
HP to pull out of the deal at thisstage.
Whitman (left), who ran anill-fated campaign forCalifornia’s governorship,took eBay from a businessturning over $4m a year to
one of the world’s biggest online retailers with revenues in excessof $8bn.
However, her record was blemished by herill-fated acquisition of Skype for $4.1bn, which was later sold
for $2.75bn. She hasalso held senior
positions at The WaltDisney Company.
Meg Whitmanis named newleader of HP UBS is cutting its investment banking
division as the trader accused of a$2.3bn (£1.5bn) fraud yesterday saidhe was “sorry beyond words”.
The bank’s cull represents betweenfive and 10 per cent of the posts with-in its advisory arm and is part of the3,500 job cuts announced in August.It is not directly related to the lossesresulting from a “rogue” trade.
Yesterday Kweku Adoboli apolo-gised through his lawyer, Patrick Gibbs, for the “consequences of hisdisastrous miscalculations”. He didnot enter a plea at City of LondonMagistrates and was remanded in cus-tody until a hearing next month.
Meanwhile Oswald Gruebel, thechief executive of UBS, is fighting toretain his job at the bank as directorsspend three days in meetings in
Singapore. UBS declined to commentlast night on whether Gruebel’s posi-tion was under discussion.
Christian Stark, analyst atCheuvreux, said the departure of Carsten Kengeter, investment bank-ing chief executive, would be the“best signal” UBS could give.
But Leigh Harrison, head of globalequities at UBS investor
Threadneedle, said there was no needfor chief executive Oswald Gruebel tostep down in the wake of the scandal.
UBS cuts underway as Adobolisays he is sorry
BY STEVE DINNEEN
TECHNOLOGY▲
BANKING▲
News 5CITYA.M. 23 SEPTEMBER 2011
UBS trader Kweku Adoboli appeared in court yesterday charged with four crimes
BNP Paribas is planning a “significant”round of job cuts across its corporateand investment bank, chief executiveBaudouin Prot said yesterday.
But he denied reports that the bank is seeking a capital injection fromQatar’s sovereign fund after rumoursthat it needs more equity sweptthrough markets.
Prot said the layoffs would comealongside a ten per cent reduction inthe bank’s assets “essentially at ourcorporate and investment bankingplatforms... It will be a significant mag-nitude, but without reaching at all thefigures announced by other banks,especially Anglo-Saxon ones.”
That makes it likely that the cuts will be in the hundreds rather thanthe thousands, unlike large-scale head-count reductions at other banks like
HSBC, Lloyds and Bank of America. They are also likely to fall mostly out-side the UK, where the firm employsthousands in its investment bank.
City A.M. understands that the cuts will fall most heavily on the lender’scorporate banking division as it movesout of areas where it considers its pres-ence sub-scale. But the investment
bank could also see staff numbersslashed as the bank shifts away fromcapital-intensive activities.
BY JULIET SAMUEL
BANKING▲
News6 CITYA.M. 23 SEPTEMBER 2011
ANALYSIS l BNP Paribas SA
€
16 Sept 19 Sept 20 Sept 21 Sept 22 Sept
30
28
26
24
23.0622 Sept
BNP Paribas to cut jobs butdenies seeking Qatari cash
GOLDMAN Sachs yesterday appointedGregg Lemkau as the bank’s new head of mergers and acquisitions inthe EMEA and Asia Pacific region. Therole is a new one for the bank,employees were informed yesterday.
Lemkau has been the co-head of the bank’s top-ranking global technol-ogy, media and telecom group (TMT),
where he has acted in the sale of Skype to Microsoft, the sale of
Autonomy to Hewlett-Packard, andfor the bank’s investment inFacebook.
He joined Goldman in 1992, became a managing director in 2001and a partner in 2002. Prior to beingco-head of the TMT group, Lemkauhad previously served as chief operat-ing officer for the investment bank-
ing division and prior to that wasco-head of the Healthcare Group.In his new role, Lemkau will retain
responsibility for many of his clients.He will join a global mergers teamoverseen by co-heads Yoel Zaoui andGene T Sykes, with Richard Campbell-Breeden as head of mergers for Asiaoutside Japan and Dusty Philip andMichael Carr as co-heads for the
Americas. Replacing Lemkau in TMT is Anthony Noto, a managing director
based in the US.Goldman said yesterday: “In his
new role Gregg will focus on drivingour M&A business across EMEA and
Asia Pacific. He will ensure that weoptimally meet our clients’ M&A objectives and expand our marketshare by deepening client relation-ships, enhancing our leading execu-tion standards and strengthening theintegration of M&A with our financ-
ing products.”
BANKING▲
@ @
MORE NEWSONLINE AT
www.cityam.com
Goldman givesnew position toGregg Lemkau
Gregg Lemkau is taking a new role at Goldman Sachs as head of EMEA M&A
BNP Paribas chief Baudouin Prot saidthere will be jobcuts at the bank Picture: REX
SAGE has agreed to sell its healthcare business to Vista Equity Partners for$320m (£207m).
The software firm says it willreturn all of the proceeds to share-holders through a buyback scheme,adding that the move will enable it tofocus on its core US customer base.
It said yesterday it had reached adefinitive agreement to sell the sub-sidiary, which is used by US GP prac-tices. It expects the sale to becompleted in November.
Chief executive Guy Berruyer said:“The sale of Sage Healthcare allowsmanagement in the North Americanregion to focus on the considerableopportunities that exist within ourcore US customer base.
“We are also announcing a share buyback programme with the pro-ceeds of the sale, reflecting our com-mitment to delivering shareholder value.”
Numis analyst Will Wallis said:“We view the Healthcare sale as posi-tive, even though the price may disap-point some. We did not see the business achieving market leader-ship, and saw significant ongoing
risks.”
Sage Healthcare’s revenue last year was £157m. Gross assets were £393mand the overall loss on the disposal isexpected to be between £60m and£70m.
Sage last month lost out in the raceto buy Australian software firmMYOB, after it was beaten by a US pri- vate equity house.
Bain Capital agreed to purchasethe accounting software company forabout $1.3bn (£790m), trumping bothSage and private equity outfitKohlberg Kravis Roberts.
Sage was forced to abandon its bid because of a drop in its share priceand a lack of shareholder support,sources said.
The Newcastle-based firm this yearreturned all of its regions to organicgrowth for the f irst time since 2007.
Sage sells its
health unitfor $320mBY STEVE DINNEEN
TECHNOLOGY▲
News8 CITYA.M. 23 SEPTEMBER 2011
CHIEF executive Tim Breedon isretiring from Legal & General atthe end of 2012, by which time he
will have spent 25 years at theinsurer.“With the company in excellent
shape I feel that next year will bethe right time to retire from thecompany. By giving notice of thisnow, the board will have ampletime to plan and ensure an orderly succession,” Breedon said yester-day.
Analysts have tipped L&G’s
incumbent finance director Nigel Wilson as Breedon’s likely succes-sor.
Wilson has stepped forward onseveral investor presentations since joining the company two years ago,
and Legal & General has often pro-moted from within when filling itstop spots in the past.
“There is a culture at Legal &General of keeping it in-house,” saidBerenberg Bank analyst TrevorMoss.
Breedon joined the board of L&Gin 2002, having started at the com-pany in 1987 and worked predomi-nantly as an index fund specialist –
working his way up through man-agement before taking the top spotin 2006.
He is credited with steering the175-year old insurer through thefinancial crisis and for preparing it
for the EU’s Solvency II capitalregime, though he will leave thecompany before the rules come intoforce in January 2013.
Last month, L&G raised its share-holder payout by a quarter afterstrong growth at its fund manage-ment and savings divisions helpedit beat first-half profit forecasts.
Breedon earned a total of £1.86min 2010, according to the company’s
annual report, including a£785,000 salary.
Last year he succeededLloyds executive Archie Kane aschairman of industry body the Association of British
Insurers, a role aspokesman said yesterday would not be affected by his upcoming departurefrom L&G.
Shares in Legal &General closed 4.44 percent down yesterday at91.40p, valuing thecompany at around£5.6bn.
Breedon to step down from Legal & GeneralBY ELIZABETH FOURNIER
INSURANCE▲
TIM BREEDON
ANALYSIS l Sage Group PLC
p
16 Sept 19 Sept 20 Sept 21 Sept 22 Sept
265.0
262.5
260.0
257.5
255.0
255.1022 Sept
Boutique investment bank WilliamBlair & Company was one of the firmsadvising Sage on the disposal of itshealthcare business.
Heading up the team was the bank’smanaging director and co-head of healthcare IT John Kibler.
The banker joined William Blair in
1997 and has worked on a string of
high profile transactions, includingAllscripts Healthcare Solutions pur-chase of Eclipsys, NetsmartTechnologies’ recapitalisation byGenstar Capital, Trover Solutions’ saleto ABRY Partners and ExamWorks’initial public offering.
Working alongside Kibler was KarlPalasz, fellow managing director andco-head of healthcare IT, who joinedthe firm in 1998 and has workedshoulder-to-shoulder on most dealswith Kibler. Also working for Sage onthe sale were Deutsche Bank and Citi,who were joint corporate brokers.
HARRIET DENNYSGot A Story? [email protected] The Capitaliston Twitter: @citycapitalist
END OF AN ERA AS CITYSAYS FAREWELL TO TOP
LINKLATERS PARTNERIT WAS “hangover central” in theCity yesterday, said one mole, thanksto some enthusiastic networking atthe City A.M. awards that continuedinto the early hours of Thursday morning in the basement nightclubin the Grange Hotel at St Paul’s.
However, the retirement party forLinklaters senior partner DavidCheyne on the same evening was amore sedate affair, with elder states-men such as Simon Mackenzie-Smithfrom Bank of America Merrill Lynch;Lord Rothschild, chairman of RIT Capital Partners; and trade adviserLord Brittan calling it a night at arespectable 11.30pm.
Cheyne will leave big shoes to fill,says his successor Robert Elliott,
who asked the 100 Linklaters part-ners and clients invited to theNatural History Museum farewell toraise a toast to the M&A lawyerdescribed as “one of the last of theCity’s corporate legends”.
From there it was over to Centricachairman Sir Roger Carr, who pre-sented Cheyne with his City A.M.award for Lawyer of the Year inabsentia, before a few words fromthe man himself. Looking back onhis long career at Linklaters, Cheynereflected he had been loyal to thefirm for 39 years since joiningLinklaters & Paines in 1972.
But this isn’t the last the City willsee of him, Cheyne added as a partingshot, reminding banking associatessuch as Morgan Stanley dealmakerSimon Robey he is still very muchavailable for consultancy and adviso-ry work when needed…
RED HOT WOMENDLA PIPER partner Miriam GonzálezDurántez hit the front pages yester-day in her role as political wife, pho-tographed in a party-correct yellow
Topshop dress as she accompaniedhusband Nick Clegg to the last day of the Lib Dem conference.
What the papers didn’t say, howev-er, was that earlier that day Durántezhad joined charity campaigner SarahBrown, designer Anya Hindmarchand Karren Brady, vice-chairman of
West Ham FC, on the judging panelto draw up the shortlist for theawards that recognise the mostimpressive women working in
business. The high-fliers Durántez and
her fellow high-achievers chose to
make the shortlist for Red maga-zine’s Red Hot Women awards will be revealed exclusively inThe Capitalist on 4 October. So
watch this space for the cre-ative, internet, fashion,start-up and pioneer con-tenders who will gohead to head at this
year’s awards on 23November…
PEAK
PRACTICEMEANWHILE, TheCapitalist caught up
with Keith Breslauer(right), the chief exec-utive of private equity firm Patron Capital,ten minutes after he
landed back in the coun-try after completing a
“brutal” climb up the world’s mostfamous granite rock face.
“Imagine climbing up the Gherkinfor a three-and-a-half days,” saidBreslauer on his 900 metre verticalascent of El Capitan in California’s
Yosemite national park.Some of the teams that started the
climb at the same time as Breslauerhad to turn back, but the distressedreal estate specialist conquered TheNose route to reach the top at 3.30pmon Monday, raising £30,000 for dis-abled Royal Marines in the process.
HELP FOR HEROESBUT Breslauer isn’t the only City name raising money for military
causes – John Clougherty, the chief executive of Aviva Investors UK FundServices, entertained guests at
Wednesday’s Heroes At The Towerevent as a sponsor of the fundraiser.
Following an introduction by General The Lord Dannatt, Aviva’sguests at the Tower of London
watched a beating retreat by theBand of the Royal Marines and a spe-cial performance by the main cast of
The Phantom of the Opera. The party also took in a private
viewing of the Crown Jewels, the White Tower, the Chapel Royal of StPeter Ad Vincula and the Ceremony of the Keys, before putting theirmoney to work in the charity auctionthat raised £175,000 on the night.
THE BIG PICTURE ALSO on Aviva, watch out for next week’s promotion inCity A.M. to givefive readers the chance to win a pro-fessional makeover and photoshoot
by fashion photographer JillianEdelstein as part of its “You Are theBig Picture” campaign.
The photos will be taken on Tuesday 11 October and the imagesprojected on to the Lyttelton Theatrelater that evening. To find out moreabout the Big Picture campaign, see
www.facebook.com/aviva
Sir Roger Carr presentsCheyne with his City A.M. Lawyer of the Year award
Richard Farleigh, former professional hedge fund manager,
author of the critically acclaimed book ‘100 Secret Strategies for
Investing’ and former star of the BBC’s hit show Dragon’s Den will
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Introduction by City AM Editor, Allister Heath
SHAREHOLDERS in the loss-makingOmega insurance group were yester-day presented with a third takeoverproposal for the group.
Barbican Insurance, a privategroup backed by Carlson Capital, said
yesterday that it was proposing to be bought by Omega in an initial all-share deal, with no acquisition premi-um to be paid out to Barbican'sshareholders.
The new company formed by thisinitial all-share deal would then offer84p in cash to buy out 25 per cent of Omega shareholders.
This 84p-per-share offer is slightly better than the 83p offers for Omegafrom privately held insurer CanopiusGroup and Mark Byrne’s HaverfordBermuda Ltd.
Omega shares edged up fractional-ly to 74p in morning trade, giving thecompany a market capitalisation of around £180m.
If the Barbican bid were to be suc-cessful, the Omega managementteam would remain in place. Omegashareholders are being asked to makesuggestions for an independent chair-man.
Barbican said that its proposal gaveOmega investors the chance to partic-ipate in an enlarged group. But SarahLewanowski at Peel Hunt said many shareholders wanted to sell out alto-gether. “Many shareholders are tiredof the situation and are hoping for aresolution,” she said.
Omega gets afresh mergerproposition
FEDEX, the world’s second biggestpackage delivery company, last nightreported a higher quarterly profitthat slightly beat forecasts but paredits outlook for the full year, citingfuel prices and moderate global eco-nomic growth.
Analysts had expected the compa-ny to lower its earnings guidance
based on a tepid domestic economy and slower international trade thanmany expected.
Businesses continue to keep a leaninventory based on consumer senti-ment, heightening the focus on costcontrols as well as rate increases to
boost profits.FedEx said its ground and freight
results offset the impact of slowingeconomic growth, which stifled vol-umes, and announced more rateincreases.
“The US and global economy grew at a s lower rate than we anticipatedduring the quarter,” Alan B Graf,FedEx chief financial officer, said.
At FedEx Express, the largest divi-sion representing more than 60 percent of revenue, domestic revenueper package rose 13 per cent even asaverage daily package volumedropped three per cent.
FedEx said its fiscal first-quarterprofit was $464m (£302.6m), com-pared with $380m a year ago.
FedEx paresoutlook despiterise in profit
BYDAVID HELLIER
INSURANCE▲
TRANSPORT▲
NewsCITYA.M. 23 SEPTEMBER 2011 11
ANALYSIS l Omega Insurance Holdings Ltd
p
16 Sept 19 Sept 20 Sept 21 Sept 22 Sept
74.50
74.00
73.50
73.00
72.50
73.5022 Sept
Insurer needs to exploit bid interest YOU wait ages for a bus and thenthree come at once, or so the sayinggoes. Shareholders in Omega, theinsurance group headed by Richard
Pexton, must feel similarly. The loss-making group, which
has been on the radar of Canopiusfor many months, now has threeproposals to consider after rivalBarbican yesterday confirmed itsinterest.
None of the proposals are ideal. The Canopius full offer for thegroup looks a little mean at 83p ashare and it is still subject to duediligence.
The offer from Mark Byrneinvolves the reinsurer managingthe company and possibly rampingup its costs. He will only tender for
25 per cent of the shares.Barbican’s deal involves a reverse
takeover that will only allow 25 percent of Omega investors to exit.
Omega’s board has done well toget an auction going. Now it needsone of the three to improve theirterms, preferably Canopius.
BOTTOMLINEAnalysis by David Hellier
Omega chief Richard Pexton has been inundated with takeover offers
LUXURY skincare firm Molton Brownhas moved to break off deals with key contractors who threaten to jeopar-dise its upmarket reputation.
Parent company Kao Prestige hashighlighted concerns over the behav-iour of firms which could damageMolton Brown’s “brand value”.
“This could be caused by poor qual-ity products, poor customer service orinappropriate sales channel selection.
The group takes great care to ensure
that any such incidents are kept to aminimum, and has implementedmeasures to end trading relation-ships with partners which are notconsidered to be an appropriatematch,” the directors wrote in the2010 accounts.
They also warn against relying onthe UK retail sector and say they have“taken steps” to limit the risk shouldthe spending slump continue.
Molton Brown, which said no-one was available to comment, makesmen’s and women’s toiletries and fra-grances and is popular with celebri-ties, including Bruce Springsteen.
It was founded in Mayfair in 1973and was for a period owned by privateequity firm Bridgepoint Capital,
which sold it to Japan’s KaoCorporation for £170m in 2005.
Kao cut annual operating losses by
49 per cent to £2.62m last year. Turnover was flat at just below £66m.
The directors described the operat-ing loss as the “short term impact” of investment in its infrastructure and
brand and stress the need to grow overseas sales.
Board movesto safeguardMolton Brown
MANUFACTURERS’ order booksshrank in September, but they expectoutput to keep growing over the nextthree months, according to a survey published yesterday by theConfederation of British Industry (CBI).
Thirty one per cent of firms report-ed “below normal” orders inSeptember, against 22 per cent whosaid they were higher than usual.
In terms of export orders, the net balance reporting growth fell to -12per cent, the lowest level in 11 months.
Both of these figures are above thelong-term average net balances of -18per cent and -21 per cent respectively.
Although the figures are negative,optimism remains in the sector asmore firms expect production toincrease than decrease in the nextquarter.
Twenty nine per cent anticipate anincrease while 20 per cent expect afall. That nine per cent net figure isabove the long-term average of six percent, but well below this year’s peak.In March the figures came in at a very positive 27 per cent.
Companies surveyed also reportedrising inventories, with the net bal-ance of firms with excess inventoriesrising to 21 per cent. That compares
with 14 per cent in August and threeper cent in June.
“Each time this measure has risensharply to around this level over thepast 25 years, it has been accompaniedor followed by falling output as firmscut back to try and shrink inventories,”said Citi’s Michael Saunders. “And thisis the sharpest rise in firms reportingexcess inventories since the survey
began in 1977.”
Ireland defies slowdownwith an export-led boom
BRISK growth surprised analysts asIreland’s economy picked up the pacein quarter two and had first quarterestimates revised upwards, the CentralStatistics Office announced yesterday.
GDP increased by 1.6 per cent overthe three months from April to July.First quarter growth was increased to1.9 per cent, up from earlier estimatesof 1.3 per cent – taking year-on-yeargrowth to 2.7 per cent.
Exports led the growth spurt – netof imports, exports increased by 23.9per cent over the year to June. Stronggrowth also came in industrial output– up 7.5 per cent in 12 months – and
agriculture – up 6.9 per cent.Building and construction slumped
with output falling 16 per cent on thesame quarter in 2010, and the publicsector continued its readjustment,contributing 2.7 per cent less to GDP.
However, analysts fear the recovery will not last – particularly because of its export-driven nature.
“After remaining broadly stagnantfor the past year or so, it appears thatIreland is beginning to recover,” saidCapital Economics’ Ben May. “It is in amuch better position than Greece andPortugal. But given the weakeningglobal economy, its problems are farfrom over.”
Manufacturers’ hopes high in face of falling demand, but concern mountsover 2012 output as stock builds up
UK ECONOMY▲
BETFAIR co-founder Ed Wray is set tostep down as chairman of the bet-ting exchange – just months afterthe firm’s chief executive said he
would quit.Betfair yesterday said it had begun
to search for a new deputy chair, who will replace Wray at an “appro-priate time” in the future.
It is unclear whether Wray willcontinue to sit on the board.
The firm said Wray, who owns tenper cent of the firm, was steppingdown to comply with the corporategovernance code, which frownsupon chairmen with large share-holdings.
A quarter of shareholders refusedto back Wray’s re-election as chair-man at the firm’s annual meeting
yesterday.David Yu, the firm’s chief execu-
tive, said in June he would quit with-in a year.
LEISURE▲
IRISH ECONOMY▲
THE CHIEF executive of £2.8bnInternational Asset Management hashit back at the “loss of faith” in hedgefunds after the industry endured agrim August.
Morten Spenner, who runs a fundof hedge funds, said the sector hadgenerated consistent returns anddampened volatility since last year.
“Since the debacle of 2008 and the‘bounce-back’ year of 2009, returnshave been dull and many have ‘writ-ten off’ hedge funds. That said, theperformance experience from
January 2010 to date has matched themain expectation of clients,” Spennersaid in a statement.
SAC Capital Advisors, Third PointOffshore Fund and T2 Partners wereamong the losers in August despitethe slump in financial stocks that
helped many hedge funds make gainsduring the banking crisis.
The industry has matured since2008, Spenner added.
“Transparency, liquidity, andinvestor control have all been muchenhanced.”
Have faith inhedge funds,says IAM boss
HEDGE FUNDS▲
Ed Wray poised to standdown as chair of Betfair
Ed Wray is thelatest boardmember to leavehis post at Betfair
DELOITTE, the world’s largestaccounting and consulting firm, saidglobal revenue rose the most in three years in the 2011 fiscal year, helped by double-digit gains in advisory andconsulting work.
Deloitte’s member firms worldwidereported a record $28.8bn (£18.8bn) inrevenue, up 8.4 per cent from 2010. Inlocal currency terms, not accountingfor fluctuations in the value of thedollar, revenue grew 7.7 per cent for
the fiscal year that ended 31 May.Deloitte will likely post similar
growth in fiscal 2012, despite a chal-lenging economic picture, the firm’sglobal chief executive, Barry Salzberg,said yesterday.
“Our first quarter [fiscal 2012]results are very much in line with what we’ve achieved in the prior year,” Salzberg said.
Deloitte also said it plans to boostits workforce 37 per cent to 250,000 by fiscal year 2015, up from 182,000
currently. The Asia-Pacific region was the
fastest-growing area for a seventhstraight year, with revenue growth of more than 25 per cent at memberfirms in Australia and India, Deloittesaid.
Deloitte’s growth came in a year when the global services sector post-ed an uneven rebound from a 2008-2009 slump. Deloitte’s results may bode well for the other “Big Four”global accounting and consultingfirms -- Ernst & Young, KPMG andPwC -- expected to report revenues in
the coming months.Financial advisory work led
Deloitte’s revenue growth, with a 15.1per cent rise, followed by a 14.9 percent jump in consulting revenue.Revenue from tax services grew 5.2per cent, while audit and enterpriserisk services rose 4.7 per cent.
A jump in consulting revenues hadhelped Deloitte edge past PwC in totalrevenues in 2010 to claim the top spotamong the Big Four firms by a mar-gin of just $9m.
went on the offensive, warning Axisshareholders that their investments will “significantly” drop in value if atakeover offer is not accepted.
Alere said that the medical technol-ogy firm’s interim results last monthhave not changed its view of the com-pany, and claims that the Axis sharesare riding high on the back of its 460pper share offer rather than underly-ing fundamentals.
Axis shares fell 1.3 per cent, outper-forming the FTSE All-Share, to close at458.5p yesterday.
Alere also claimed that Axis’ opera-tions in the US have been dealt a blow by the recent loss of Axis-Shield USA president, John Sperzel, who movedto rival ITC Nexus last week.
The Axis board has repeatedly
asked shareholders to reject Alere’soffer since its approach in June.
Alere became Axis’ biggest share-holder this week after buying 1mshares from Skagen Funds. After itsfirst acceptance deadline passed on 1September, Alere had approvals from just one per cent of the shares it didnot own.
An Axis-Shield spokesman declinedto comment last night, beyond notingthat Alere has until a deadline onMonday to raise its offer.
Alere warns of share price fallat Axis-Shield
BYHARRY BANKS
FINANCIAL SERVICES▲
M&A▲
News 13CITYA.M. 23 SEPTEMBER 2011
NIKE topped Wall Street’s profit esti-mates yesterday as the world’s biggest athletic shoe and clothingmaker staved off margin pressures with strong sales and price increas-es, sending shares up 5.7 per cent inafter-market trading.
The company, which also owns brands like Converse, Umbro andHurley, said sales rose 18 per cent to$6.1bn (£4bn) in the first quarter.
Future orders, a closely watched
measure of demand in comingmonths, were up 16 per cent to total$8.5bn.
The Oregon-based company, whichcompetes with European sportsweargroups Adidas and Puma saw income rise 15 per cent to $645m, or$1.36 a share, ahead of analysts’expectations of $1.21 a share.
It saw gross margins slide by 270 basis points this quarter, however.But the decline was smaller than the300bp fall it had anticipated earlier.
RETAIL▲
Just done it: chief executive Mark Parker has delivered a jump in sales
TALKTALK once again topped thetable of most complained aboutphone and broadband providers,according to new research by Ofcom.
The X-Factor sponsor received morethan three times as many complaintsper 1,000 customers as its closest rivalfor its phone services and twice asmany regarding its broadband pack-ages.
However, the number of com-plaints levelled against it fell by around 50 per cent compared to thelast quarter of 2010.
Virgin Media received the lowestnumber of complaints for both phoneand broadband services, with BT andSky roughly level.
The survey comes after TalkTalk was fined a record £3m by Ofcom forincorrectly billing tens of thousands
of consumers for services they hadnot received during the integration of
Tiscali. A TalkTalk spokesman called the
results “encouraging” but admittedthere is still much work to be done.
Meanwhile network operator Threetopped the complaints list for mobileservices, attracting a third more com-plaints than Orange, T-Mobile and
Vodafone and three times more than best performer O2.
Ernest Doku, technology expert atuSwitch.com, said: “Since Ofcom
began compiling the data nearly a year ago, TalkTalk Group has stoodout as the worst performer in bothlandline and fixed broadband servic-es. But while there is still more to bedone, TalkTalk is clearly pulling itssocks up. In the second quarter of 2011 they received substantially fewercomplaints than in the first quarter.
These are positive steps.”
TalkTalk topscomplaintsleague table
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SANY Heavy Industry has postponedits up to $3.3bn (£2.1bn) Hong Kongshare offering due to tumbling globalmarkets, it emerged yesterday.
The company, China’s largest con-struction machinery maker, has setno new dates for the deal, said thesources, who could not be named
because the decision is not public.Sany Heavy’s deal would have been
Hong Kong’s second-largest offeringthis year.If it is postponed, it will be the sec-
ond high profile IPO to have stalled inthe far east this week. EarlierManchester United paused its sharelisting in Singapore, with sources cit-ing “market volatility” as the reason.
Hong Kong’s benchmark HangSeng Index tumbled nearly five percent yesterday amid concern aboutEurope’s debt crisis and the US econo-my.
The index has retreated 11.4 percent since Sany Heavy and its under- writers began meeting with investorsto drum up demand for the deal on 5September while Sany Heavy’sShanghai-listed stock has declined 5.4per cent over the same period.
“There’s not much you can do witha market like this,” said a source withdirect knowledge of Sany Heavy’s list-ing plans.
The UK’s new issues market hasseen very few listings recently.
China’s Sany Heavy calls off Hong Kong IPO as stocks fallBYHARRY BANKS
CAPITAL MARKETS▲
News14 CITYA.M. 23 SEPTEMBER 2011
CITY VIEWS: ARE YOU HAPPY WITH YOUR PHONEPROVIDER? Interviews by Phoebe Torrance
“I have never had problems with my provider. I havebeen tempted to change before to a provider with
better signal but I haven't ever found a cheaperdeal.”
REBECCA HAUSLER | NRI
“When I first got my phone, the most important thingto me was signal, so I went with the provider withthe best signal. It may not have the best deal butas long as it works it’s fine.”
GREG KNOTT | HERMES BPK
“I have been with the same provider for a number of years, which has been a lot better than my previousones. All of us at the company I work for are lookedafter very well by the same provider.”
GARY DINGWALL | LINEDATA
FIXED LINE COMPLAINTS
Complaints per 1,000 customers Q2/11 Q4/10
Talk Talk 0.8 1.16
BT Retail 0.25 0.2
BSkyB 0.25 0.24
Virgin Media 0.15 0.12
MOBILE SERVICES
Complaints per 1,000 customers Q2/11 Q4/10
3UK 0.14 0.09
Orange 0.07 0.06
T-Mobile 0.06 0.06
Vodafone 0.06 0.05
O2 0.02 0.03
* These views are those of the individuals above and not necessarily those of their company.
EASYJET yesterday announced a£150m special dividend as the compa-ny raised profit guidance, thanks to a boost from business travellers andshort-break tourists.
The airline announced a total pay-out of £190m – including a year-enddividend of £40m – for the year to 30September.
Chief executive Carolyn McCallsaid: “When we announced our strate-gy last November we announced the
first dividend in the airline’s history [and that] if there was excess liquidity ... we would return it to shareholders.”
Sir Stelios Haji-Ioannou, founder of easyJet and its largest shareholder with a 38 per cent stake, has beenlocked in a dispute with the board
and has called for more dividends andless expansion of the fleet. Heresigned from the board last year
The company raised its pre-tax prof-it guidance for the year to between£240m-£250m, from its original fore-cast of between £200m-£230m.
EasyJet shares rose nine per cent yesterday.
EasyJet upsdividend asearnings rise
TUI Travel is on track to meet full-yearprofit expectations due to strong latesummer bookings although Europe’s biggest tour operator has yet to see arevival in demand for holidays inEgypt and Tunisia.
TUI said political unrest in theMiddle East and North Africa was stillputting customers off vacationing inthe region.
The group, which operates the Thomson and First Choice chains, cutthe amount of holidays it sold toEgypt and Tunisia this summer and
increased holidays on sale to alterna-tive destinations such as Spain,Greece and Turkey.
“We are anticipating a slow recov-ery in trading to Egypt and Tunisiaand have managed our capacity accordingly,” chief executive PeterLong said. Numis analyst Wyn Ellisdowngraded the stock to “hold” from“add” and cut his price target to 160pfrom 180p, flagging concerns over ris-ing fuel prices, Middle East and North Africa unrest and macro-economicconcerns.
But TUI said its full year results
would be in line with expectationsfollowing strong late demand forsummer holidays. It said the summerseason had traded well with bookingsup across most of its markets.
“We are pleased with our perform-ance in the lates market for summer2011 and most of our programmesare now almost fully sold.
“We remain confident that the full year results will be in line with ourexpectations,” Long said.
The group added that trading for winter 2011-12 had been satisfactory overall.
Aer Lingus hits back atRyanair over criticism
IRELAND’S Aer Lingus has written toits shareholder and rival Ryanair toreject the latter’s complaints that itis “continually ignored” by the AerLingus board.
In a letter sent to Ryanair andreleased yesterday, Aer Lingus saidRyanair was a source of concern toother investors and welcomed itsrecent statement that it would beprepared to sell its 30 per cent stakein Aer Lingus if the governmentfound a buyer for the state’s 25 percent holding.
“One of the greatest concerns that we hear from shareholders relates to
Ryanair’s shareholding in the com-pany and its impact on the compa-ny’s options and value,” chairmanColm Barrington wrote in the letter.
“As such, we welcome your recentstatements that Ryanair would beprepared to dispose of its sharehold-ing in Aer Lingus.
“We would hope to have construc-tive discussions with you on thisissue.”
Ryanair, Europe’s largest budgetairline, has twice had takeover bidsfor Aer Lingus rebuffed and its out-spoken chief executive MichaelO’Leary has been a long-standingcritic of the company.
TUI Travel on track to meetfull year in late bookings lift
BY JOHN DUNNE
AVIATION▲
LEISURE▲
AVIATION▲
ANALYST VIEWS: IS EASYJET HOLDING UPWELL AGAINST ITS RIVALS? Interviews by John Dunne
“
KEITH BOWMAN | HARGREAVES LANSDOWN
In all, whilst the airline industry remains amongst the toughest to navi-gate, a low-cost offering which appears to be finding increasing appeal with busi-ness customers is a big plus, a fact underpinning currently favourable (buy)market consensus opinion.
”
“
GERT ZONNEVELD | PANMURE GORDON
Strong trading update and pre-tax profit guidance raised to £240m-£250m. In addition to expecting to announce a maiden 9p dividend, the Boardannounces an additional £150m return of capital to shareholders. We retain ourbuy recommendation.
”
“
WYN ELLIS | NUMIS
Bookings for FY12E have star ted strongly, but the statement highlightssignificant cost pressures and, in an uncertain economic environment, we remaincautious on the outlook. The other issue of major concern is the behaviour of SirStelios as he continues his open conflict over strategy with the board.
”
TIME LINE | EASYJET BOARD’SBATTLE WITH STELIOS
March 2010EasyJet plc announces that Carolyn McCallOBE will be the new chief executive of thecompany
May 2010Sir Stelios Haji-Ioannou, easyJet’s founder,resigns from the airline's board, saying he is
unhappy with the way the company oper-ates. The budget airline is aiming to expandits share of Europe's short-haul market fromabout seven per cent currently to ten.
June 2010The dispute goes to the high court as Steliosaccuses the company of breaching brandagreements.
October 2010EasyJet resolves a long-running brand dis-pute which sees the discount airline'sfounder lose his right to appoint himself chairman of the board or to appoint mem-bers. Under a new brand agreement he willreceive an annual royalty of 0.25 per cent of easyJet's total revenues.
July 2011Stelios launches new assault on company'sdecision to order planes from Airbus.
August 2011Stelios demands an EGM to get rid of seniornon-executive director Sir David Michels,who then steps down. A month later, Stelioscalls for another director, Rigas Doganis, toleave.
IT GROUP Altitude said yesterday it was confident of meeting its full yearforecasts, after revenues rose 12 percent in the first half of the year.
Revenues at Altitude, which sup-plies IT services to the promotionalproducts industry, hit £2.46m, whilegross profits rose 21.5 per cent to£1.69m.
“2011 has so far been a crucial yearfor the group, with the disposal of thepromotional products division trans-forming Altitude into a purely infor-mation and technology services
focused company,” said chief execu-tive Martin Varley.
THE developer of Canary Wharf aimsto double the size of the estate overthe next decade on the back of anexpected long-term shortage of prime office space.
The expansion of the financial cen-tre will help it meet the extra 100,000passengers created when Crossrail isup and running, said Canary Wharf Group (CWG), which owns 16 out of 35 buildings on the site.
CWG is 69 per cent owned by Songbird, the listed property vehicle. John Garwood, Songbird company secretary, told City A.M. that London’scompetitiveness will be supported by its reputation for corporate gover-nance, its lifestyle and its timezone.
“London has been an internationalplayer in finance and insurance formore than 200 years and that is not being undermined by the short-termposition we are in,” he said.
CWG is also in a joint venture withLand Securities to build the Walkie Talkie tower and will redevelopShell’s London HQ with Qatari Diar. Yesterday CWG said the market valueof its retained investment property
portfolio at June 30 was £4.7bn, up1.9 per cent. Chairman GeorgeIacobescu added: “There is a lot morecapacity to build in and aroundCanary Wharf and I hope it’s notonly going to be Canary Wharf Group [doing so].”
Songbird posted a pre-tax profit forthe six months to June of £97.6m,compared with an £11.3m loss in the2010 period. Its adjusted net asset value per share rose 3.7 per cent to194p.
Its property portfolio, includingdevelopment sites, was valued at£5bn on 30 June, up two per centfrom the end of 2010. First-half rentalincome fell 18.8 per cent to £124.6m.
Canary Wharf
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ALTERNATIVE energy firm Energetix was one of the top performers onLondon’s Alternative InvestmentMarket yesterday, after it said itsturnover increased tenfold to £100,000in the first half of the year comparedto 2010.
The firm reported on an “encourag-ing and transformational” first sixmonths of 2011, and said operatinglosses had been reduced from £1.8m to£1.2m. In the six months to end June,Energetix has transformed from aproduct development company to a
group focused on commercialising itscore products.
Energetix risesas revenues leapAltitude upbeatfor the full year
BY PETER EDWARDS
PROPERTY▲
TECHNOLOGY▲
ENERGY▲
THE UK arm of German utility E.ON will cut up to 500 support staff in itsCoventry and Nottingham offices fol-lowing the sale of its distributionarm, Central Networks, to PPL inMarch this year, it said yesterday.
“We had to undertake a deep andrigorous review of how much money we spend in order to ensure we keepcosts as low as possible for our cus-
tomers, become a more agile organi-sation and build a sustainable busi-ness in the UK,” E.ON UK chief executive Dr Paul Golby said in astatement.
The company plans to cut jobs by offering voluntary redundancies.
Last month E.ON outlined plans tocut costs by €1.5bn (£1.31bn) over thenext four years. The firm employsaround 12,000 people in the UK andmore than 79,000 worldwide.
E.ON looks to cut500 jobs in the UKENERGY
▲
Canary Wharf isexpanding aheadof the opening of anew Crossrail sta- tion
UNITED Utilities Group, Britain’slargest listed water utility, said it hadtraded in line with its expectations with higher first-half revenue offset by rising operating expenses.
The British utility said it was ontrack to meet targets and would accel-erate £100m of previously agreed pen-sion deficit payments to provide ahigher investment return.
United Utilities’ first-half revenue
improved year-on-year due to risinginflation pushing up regulated priceincreases.
However the costs of renewing infra-structure will continue to rise, withexpenditure on regulatory capitalinvestment and depreciation in thesecond half expected to top that of thefirst half.
The firm said its underlying netfinance costs are expected to be slight-ly higher than the first half of the year,after it drew down a £200m loan facil-
ity. A deferred tax credit of £50m will be recognised this year, the firm said,after corporation tax was loweredfrom April 2012.
United Utilities reported a lower-than-expected 32 per cent drop inannual profits earlier this year, after it was ordered by regulators to cut pricesas part of a sector review.
Meanwhile British PeerNorthumbrian Water Group wassnapped up by Hong Kong tycoon LiKa-shing last month for £2.4bn in the biggest takeover this year of a British-
listed company, prompting specula-tion of further takeovers in the sector.
Shares in United Utilities closeddown 1.4 per cent at 601.5p.
United Utilitessays revenuesare on the upBYHARRY BANKS
UTILITIES▲
NewsCITYA.M. 23 SEPTEMBER 2011 17
London 2012
IMAGE OF THE WEEK
Designed by jewellery artist Lin Cheung,
the medals for the 2012 ParalympicGames were unveiled at a ceremony atthe British Museum on Monday.More than 2,100 medals will be pre-sented at the 2012 Paralympic Games.
Between now and the start of the 2012Olympic and Paralympic Games,City
A.M. is publishing its Olympic Image of
the Week. We welcome photographsfrom all sources – sponsors, athletes,local businesses, commuters, local resi-dents – if you have a shot you think ourreaders will like, please [email protected] with IOW2012in the subject line. Full details:www.cityam.com/london-2012.
2012 PARALYMPICS | MEDALS UNVEILED
NEWS | IN BRIEF
Vitesse Media trading in lineVitesse Media, the online financial newspublisher, has announced that its interimresults are in line with managementexpectations, despite experiencing aslowdown that began in April. The com-pany, whose publications includeInformation Age and Business XL, saw
revenues fall from £1.56m last year to£1.51m, while a £33,000 profit turnedinto a £15,000 loss. Gross marginimproved to 70.5 per cent, as costs arereduced through transition from print todigital delivery.
Rolls picks new finance chief Rolls-Royce yesterday unveiled MarkMorris as its new finance director,replacing Andrew Shilston, who is retir-ing at the end of the year. Morris joinedRolls in 1986 as a graduate, and hasworked his way up to group treasurer.He will join the engineering group’sboard alongside his new role on 1January 2012. Shilston joined Rolls asfinance director in 2002. Morris said:“Andrew Shilston has been a great men-tor and will be a tough act to follow.”
Kerry Group buys Cargill armIrish food firm Kerry Group has agreed
to buy conglomerate Cargill’s globalflavours business for $230m (£150m).The firm, which owns Wall’s sausagesand Kerrymaid butter, said the new divi-sion employs 700 people and has annualrevenues of around $200m. Kerry saidthe transaction, expected to close byyear-end, will give it access to moreemerging markets. Cargill FlavorSystems provides food technology serv-ices for dairy and beverage companies,and has operations in North America,Brazil, Europe and Asia.
● United Utilities provides water and waste-water services to 3.2m households and400,000 businesses in north west England● The group maintains 42,000km of pipelinesand 100 water treatment works
UNITED Technologies has reached a$16.5bn (£10.7bn) cash deal to acquireaircraft components maker Goodrich,in what would be the diversified USmanufacturer’s biggest deal in adecade.
United Tech, led by GeorgeDavid (pictured), said it wouldpay $127.50 a share forGoodrich, a 47 per cent premi-um over the stock’s price before news of a possible bid.It also includes $1.9bn inassumed debt.
The deal comes as blue-chipUnited Tech looks to cash inon the upswing inplane orders and
production asdeclining globalspending on
defence pressures its military arm. The acquisition can help it build
critical mass in new aircraft technolo-gy and plane services as civil demandrebounds.
Goodrich is poised to grow as key commercial plane programmes suchas the Boeing 787 Dreamliner and
upcoming Airbus A320neoramp up production.
The deal comes despite a broad slowdown in mergeractivity globally, as market volatility and economiuncertainty give many firms a pause.
Goodrich supplies partsfor United Tech’s Pratt &
Whitney engines andH a m i l t o n
Sundstrand’saircraft elec-tronics.
Goodrich soldto United Tech
Discoveries A product of Lufthansa.
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For other European destinations, please check the respective fares and conditions.
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INDUSTRIALS▲
NIPPON Steel and Sumitomo MetalIndustries said yesterday that stake-holders of Sumitomo would get 0.735Nippon Steel shares for eachSumitomo share if they combine tocreate the world’s second-biggest steel-maker, in what would be Japan’s biggest non-financial sector merger.
The ratio, largely in line with expec-tations, means the transaction would
be worth about $22.45bn (£14.6bn),including Sumitomo’s net debt,trumping the $17.53bn acquisition of Vodafone KK by Softbank in 2006. Thenew firm, to be called Nippon Steel &Sumitomo Metal, would target globaloutput of 60-70m tonnes a year by accelerating overseas expansion, thetwo companies said.
“We’ll aggressively expand into over-
seas markets,” Shoji Muneoka, presi-dent of Nippon Steel.
INDUSTRIALS▲
BRITAIN’S Sinclair IS Pharma said trad-ing in its current first quarter has beenencouraging as it posted wider corelosses for the year to end June.
The Aim-listed company completeda fundraising last October 2010 and amerger with IS Pharma, a business bought to bolster its portfolio of spe-ciality products, in May 2011.
“Crucially we believe the company is
now able to deliver sustainable organ-ic growth without the need for furtherfinancing,” said chief executive ChrisSpooner.
“Recent trading has been particular-ly encouraging and with severalplanned launches in the near term weare confident that the momentum will build through the year to June2012 and beyond.”
The IS Pharma deal gave it a UK andIreland sales network, and addedoncology treatments to the dermato-
logical, wound care and oral healthproducts it sells to hospitals. The company also said John Gregory
has stepped down as chairman andthat Grahame Cook will assume therole of non-executive chairman effec-tive immediately.
Ebitda losses before exceptionalitems widened to £1.4m, from£500,000, as revenue grew 19 per centto £32.9m.
Sinclair said in July its numbers would be ahead of expectations.
Changes at the top as losseswiden at Sinclair IS PharmaBYHARRY BANKSPHARMA▲
News18 CITYA.M. 23 SEPTEMBER 2011
BEST OF THE BROKERS
To appear in Best of the Brokers email your research to [email protected]
ANALYSIS l British Land Co
625
575
525
475
Jul Aug Sep
p
479.3022 Sept
BRITISH LANDEvolution Securities gave British Land a“neutral” rating after its investor day, inwhich it noted the lack of a clear roadmap.The broker acknowledges the quality of thefirm’s portfolio and excellent balance sheetbut said a lack of clarity prompted the rat-
ing. It gave a target price of 600p.
ANALYSIS l Credit Suisse
37.50
32.50
27.50
22.50
Jul Aug Sep
CHF
20.9522 Sept
CREDIT SUISSECollins Stewart maintained its “buy” ratingon Credit Suisse, updating its target priceto CHF43. The broker said the Swiss bankshould be the biggest winner from UBS’recent woes, although it has also factoredin a hit to earnings owing to a German tax-case settlement.
ANALYSIS l 2Ergo Group
70
60
Jul Aug Sep
p60.0022 Sept
2ERGONumis advised investors to “hold” 2ergostock, slapping a target price of 70p on thestock. It said key risks stem from executionand cash but believes that if managementcan deliver on their plans it could reach
120p by 2013. It said the impact of regula-tory changes, were relatively severe.
Sumimoto Metal and NipponSteel thrash out $22bn merger
Sinclair ISThe pharma company has appointedboard member Grahame Cook as non-
executive chairman. Cook succeedsJohn Gregory, who has stepped downas chairman and from the board of
directors following the merger of Sinclair Pharma and IS Pharma.
DLA PiperAlexander Sarac has been appointed aslegal director to the law firm’s energyteam. Prior to joining DLA Piper, Sarac
was general counsel of EcoSecuritiesGroup, a subsidiary of JP MorganChase, where he managed the globallegal team based in offices acrossChina, Malaysia, Brazil and the UK.
Fleming Family & PartnersThe wealth manager has appointed Bill
Emmott, the former editor-in-chief of the Economist, as group economicadviser. Emmott is currently on thechairman’s advisory board of Swiss Reand a trustee of the InternationalInstitute for Strategic Studies.
Collins StewartCollins Stewart Wealth Managementhas hired a three-strong advisory teamfrom Barclays Wealth. Tony Akrasi,Andrew Little and Turon Miah, who
join as stockbrokers, will join CollinsStewart Wealth Management’s Londonadvisory desk.
Jones DayThe global law firm has hired PaulExley as a partner in its energy prac-tice, and John Ahern as a partner in itsfinancial institutions practice. Exley
joins from Simmons & Simmons andAhern joins from Addleshaw Goddard.
Renaissance CapitalThe investment bank has appointedMert Yildiz as Turkey and emergingEurope economist. He joins the firmfrom Kuwait China InvestmentCompany and has also spent time atING Bank in Istanbul.
CITY MOVES | WHO’S SWITCHING JOBS Edited by Harriet Dennys
+44 (0)20 7092 0053morganmckinley.com
To appear in CITYMOVESplease email your careerupdates and pictures to [email protected] SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
in association with
A TOXIC cocktail comprising agrim economic outlook fromthe US Federal Reserve anddownbeat data in China left
Britain’s top shares nursing a nearfive per cent drop yesterday, asinvestors pinned some hopes on this
week’s G20 meeting.Commodity stocks, sensitive to
data showing a stuttering recovery, were the biggest fallers by some mar-gin, led by Vedanta Resources, downmore than 13 per cent, as metal andcrude prices tumbled.
Markets were fearful over futuredemand as a gloomy statement fromthe Fed was compounded by datashowing more evidence of a slow-down in top commodity consumerChina.
HSBC’s China Flash PMI survey showed factory output fell for a thirdconsecutive month in September.
After the Fed said the economy faced “significant downside risks”, aG20 meeting in Washington this
week will be watched for any furtherpolicy response in tackling the globalslowdown and euro zone debt crisis.
The FTSE 100 slid 246.80 points, or4.7 per cent, to 5,041.61, hitting a five-
week closing low and registering its biggest one-day percentage fall sinceearly March 2009.
The UK benchmark saw £64bn wiped off its value yesterday.
There were no blue-chip gainers, while the FTSE 100 volatility index jumped nearly 17 per cent – evidencethat nervousness is growing.
FTSE suffers 5pc
losses on Fed woeTHELONDONREPORT
27 Jun 15 Jul 4 Aug 14 Sep24 Aug
6,200
5,400
5,000
5,800
ANALYSIS l FTSE
5041.6122 Sept
ViperaThe mobile financial services provider hasappointed Luciano Martucci, the former chair-man of IBM Italia, as a non-executive chair-man. In addition, Petter Neby, chairman of Neby & Jahrmann, a cornerstone investor in
Vipera, has been appointed as a non-executivedirector, and non-executive chairman JohnDefterios has resigned from the board.
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Dire day of sellingsinks US equities
US stocks plunged yesterday,extending a selloff to four days,as policymakers’ failure toarrest global economic stagna-
tion sent markets spiraling down- ward.
The heavy volume of last night’splunge signaled investors are sellingin anticipation of more losses. WallStreet’s “fear gauge”, the CBOE
Volatility Index, jumped 12 per cent,giving the index its biggest two-day percentage spike in a month as
investors protected against more loss-es to come.
Energy and materials shares wereamong the hardest hit areas on wor-ries of slowing worldwide demand.Signs of a slowdown in China fedthose fears.
The Dow Jones industrial averagedropped 391.01 points, or 3.51 percent, to 10,733.83. The Standard &Poor’s 500 Index lost 37.20 points, or3.19 per cent, to 1,129.56. The NasdaqComposite Index slid 82.52 points, or3.25 per cent, to 2,455.67.
Volume of about 13.24bn sharestraded on the New York Stock Exchange, NYSE Amex and Nasdaq
was well above the daily average of 7.8bn and the highest since 10 August.
US crude oil futures tumbled morethan six per cent, the biggest one-day percentage drop in six weeks.
THE markets were hoping for ahelicopter drop from the USFederal Reserve this week, areference to Ben Bernanke’s
infamous 2002 speech on how toprevent deflation. What they got was more a paper plane, where theFed will fly Treasury bonds from theshort to the long end of the interestrate curve. The resultant sell-off instocks and increase in the dollarreflects the disappointment withthe lack of a third round of quanti-tative easing (QE3), or hints thereof.Beyond this though, Operation Twist is unlikely to deliver therequired boost to the economy andhere’s why.
First, there’s the starting point. By selling its holdings of short-datedsecurities (less than three yearsmaturity) and buying long-datedsecurities (anything from six to 30 years left to maturity), the hope is tolower the yields – which moveinversely to prices – on Treasuries, which feeds through to corporateand household borrowing costs. And during the first Operation Twist back in 1962, when The Twist was actually dance-floor fashion,the Fed succeeded in pushing down10-year Treasury yields to the 1.85per cent level. But this was the levelthat US yields were already at goinginto last night’s decision. In other words, the Fed is now starting fromthe previous end-point.
Second, by selling short and buy-ing long on such a scale ($400bn),the Fed is clearly trying to flattenthe yield curve, which will come viafalling long-dated yields and possi- bly higher short-dated yields. But indoing so, banks will be further
squeezed on their profitability, given that themargin on borrowing short-term funds andlending long (in the form of mortgages, forinstance) will be further reduced.Interestingly, the spread between two and ten year yields is currently 155 basis points (bps), which equates exactly to the average of thepast ten years and is some 80bps below theaverage since Lehman’s demise three yearsago. Already we are seeing mortgage ratesreact to this, so even though the US 10-year yield may be at multi-decade lows, the differ-ence between mortgage rates and Treasury rates has been widening dramatically inrecent weeks. While 10-year Treasury yieldsfell 1 per cent to 1.85 per cent, equivalentmortgage rates have fallen only 0.2 per cent.In other words, Operation Twist could bemore about prevention of higher borrowingrates rather than curing the economy by pulling them substantially lower.
Third, to be effective in pushing bond yields substantially lower, US yields wouldhave to approach levels currently prevailingin Japan, where 10 year yields are near to 1per cent. But Japan can finance governmentdebt twice the size of its economy thanks to acaptive pool of domestic savers. In stark con-trast, the US is reliant on overseas investors, who hold nearly half of marketable Treasury securities. Will they be happy to finance theUS deficit for a return of 1 per cent? It’s possi- ble, but the road to equivalence on US and Japan yields is not going to be plain sailing by any means.
Finally, at this point in the cycle (flirtation with recession), the lack of any hint of QE3goes against Bernanke’s 2002 speech wherehe stated “by moving decisively and early, theFed may be able to prevent the economy fromslipping into deflation”. The Fed managedthis at the beginning of the crisis, but iserring away from it at t he current inflexionpoint. This is not the time to be timid.
So how can the Fed be bold when rates are
practically zero and two rounds of QE havealready been undertaken? There remainnumerous possibilities, not least anotherdose of QE. In terms of government bonds,the Fed still owns around 18 per cent of out-standing government bonds, versus over 20per cent in the UK after just one round of QE. There remains scope for reducing or elimi-nating the interest rate on excess reservesheld at the Fed, encouraging banks to lendfunds out. There’s also the possibility for anexplicit target for any of bond yields/nominalGDP/inflation/the unemployment rate (butcertainly not all simultaneously). Alternatively, there is also the more radicalsuggestion that the Fed could lend indirectly to the private sector using the banks as theconduit. Utilising the discount window, theFed could lend at virtually zero interest ratesto the banks, in turn accepting collateral onquality private sector assets such as corporate bonds, commercial paper, bank loans and thelike. This in turn would potentially signifi-cantly lower the cost of capital for both banksand the non-financial private sector.
It’s more likely than not that some of theseoptions were discussed at this week’s meet-ing, but the Fed Chairman was unable to con- vince recent dissenters of the merits of thesemore radical approaches. Like it or notthough, many debt-laden developedeconomies are suffering from piece-meal pol-icy responses and Operation Twist will even-tually be labeled as just another one of these.
Simon Smith is chief economist at FxPro.
The Fed acted decisively atthe start of the crisis but iserring away from that now
The Fed’s paper plane won’tfly: why the US economy isin need of more than a Twist
SO it’s goodbye London Fashion Week until next year, as the sartorial bonan-za drew to a close with menswear day on Wednesday. Highlights included a
spot of celebrity bingo with Topshop’s frontrow (Jamie Hince, Mr Kate Moss to you, andSir Philip Green were all to be seen) andOliver Spencer’s shortened trousers. Alsostriking was the widespread presence of thepyjama bottom and luxe sportswear as seen atChristopher Shannon and E.Tautz, but don’t
worry, we don’t expect you to go to work in apair of track pants. Luckily, also dominating thecatwalks were wearable pieces worth investingin, which will make sure you’re bang on trend
when spring rolls around.
Lifestyle | Fashion & Reviews
23
Post fashion week,Helena Lee finds outwhat the hottest looksfor men are set to benext season
Toby Bateman, buying director at Mr Porter, themenswear shopping site, takes us through the fivekey trends that have emerged from the catwalksand chooses the best pieces to help you get aheadof the fashion game.
1 The Deconstructed Jacket
“Unlined and deconstructed jackets make a lot of sense because they keep things smart without
being too heavy in high summer. On the catwalk,Oliver Spencer excelled here with single and dou-ble breasted versions in a broad variety of colours
including red, white and navy.”Toby suggests Richard James deconstructed cash-mere-blend jacket, £895 2 The Wool Trouser
“Spotted at E.Tautz, the wool trouser seems like anodd choice for the summer season but do bear inmind that these clothes arrive in-store for January,so you will definitely get a lot of wear from them.A long-awaited replacement for the omnipresent
chino.”Toby suggests Ami slim fit wool flannel trousers,
£185
3 The Printed Shirt
“A new take on shirting is emerging, as it movesaway from chambrays and denim towards some-thing a bit more playful. Polka dots will be ontrend, as seen in the Oliver Spencer show.”Toby suggests Oliver Spencer spotted cotton shirt,
£1204 The Rucksack
“The rucksack has definitely replaced the shopper
as the men’s bag of choice, or the designer’s bag of choice at least. Seen at numerous shows, it’s a raretrend where function dictates fashion and appeals
to a very broad menswear demographic. Invest inone now.”Toby suggests Seil Marschall premium day back-
pack, £1905 The Coloured-Sole Shoe
“Shoes with coloured soles were as popular withthe audience as they were on the catwalk. MarkMcNairy was the brand of choice in the audience.A colourful sole looks best on the bottom of a sim-
ple Derby or Oxford style.”Toby suggests Mark McNairy Derby shoes £195
All pieces are available from www.mrporter.com
Lifestyle | Review
Gosling shines in both romcom and action filmsTimothy Barber getsto know the two sides
of Ryan Gosling’smuscles in the latestblockbusters
Film
CRAZY, STUPID, LOVECert: 12A
hhhii
YOU wait all year for a Ryan Gosling f ilm(well, some people do, perhaps) and twocome along at once. Here he plays Jacob,her muscle-bound playboy who takescuckolded dad Steve Carrell under his
wing to tutor him in the ways of being aright stud.
Crazy, Stupid, Love is not actually thelame-o bromance that description makes
it sound like though – there is more toit, though perhaps not as much as the
filmmakers behind it would like us tothink.
Carrell, ever the middle-class, middle-management, nice-guy loser, is Cal, a 40-something bloke married to his
high-school sweetheart Emily (JulianneMoore), who he leaves after she hasadmits to having an affair. Having nevereven dated another woman, Cal’s all atsea in the world of singledom until hemeets slick player Jacob, who for somereason decides to mentor him.
But guess what? Jacob finds himself falling like never before for a sassy chick (played by girl of the moment EmmaStone), while even Cal and Emily’steenage son has a problem of unrequitedlove to deal with.
It’s all rather twee and smug, frankly,though not without some sharp linesand charming moments. It’s helpedalong by a very talented, likeable cast –including cameos from Marisa Tomeiand Kevin Bacon – and a script whichavoids completely obvious scenarios.
Crazy, Stupid, Love doesn’t tell usmuch about love other than it can be a
bit crazy and a bit stupid at times, but
it’s more endearing and nuanced thanmost films occupying similar territory.
Film
DRIVECert: 18
hhhhh
CRIME films and Los Angeles gotogether like peas in a pod, but it’s along time since the classic combina-tion has produced something asthrilling and as stylish as Drive. Ryan
Gosling is the charismatic, unnamedpetrolhead at the heart of the action – a
mechanic and stunt driver for the movie business by day, and getaway man forarmed robbers by night. He’s also a clas-sic Hollywood antihero: a brooding,monosyllabic, toothpick-chewing loner,
who’s cool as damn and up to his neck inall the wrong problems. These coalescearound his next-door neighbour Irene, a
young mother played by An Educationstar Carey Mulligan. Just as Driver (ashe’s known) is being stirred from hislonesome existence by this vulnerable
woman and her son Benicio, her jailbirdhusband reappears. He’s in trouble withsome very nasty people, and with Irene
and Benicio at risk Driver volunteersto help. Naturally enough, thingsgo very badly wrong indeed.
Drive is directed by Danish film-maker Nicolas Winding Refn, whomade 2009’s viscerally marvellousBronson. Here Refn confirms hisexciting talent – Drive is a neon-lit thrill ride, making perfect useof its L.A. locations and steadily accelerates until it’s clatteringalong at 150mph. It may be horri- bly violent in places but it’s rivet-
ing and a beautiful homage tocountless movies of the past.
Monaco’s callingThe principality’s largest residentialdevelopment in years has come tomarket, pointing to Monaco’s enduringappeal as a place to invest both yourcash and your time, says Zoe Strimpel
TIMES are tough for property insome parts of the world. Not, how-ever, in Monaco, where investorsseeking classic, mature markets
feel comfortable. The fact that it’s stillone of the most glamorous locations onearth – with some of the world’s best
restaurants and casinos (and let’s not for-get the marina) – doesn’t hurt, althoughits status as tax haven may still beMonaco’s biggest draw.
There’s no better proof of Monaco’sstrength than a new development calledNo. 23 Boulevard de Belgique being sold
by Knight Frank. With celebrity designer Jacques Garcia as decorator, buyers areforking out for the very best. If you like
what Garcia has done with the entrancelobbies and gym, you can commissionhim to decorate your own apartment.
That would put your flat in the sameleague as the the Place Vendome pied a
terre of the Sultan of Brunei; Paris’sultra-glamorous Hotel Costes, MonteCarlo’s Hotel Metropole and the leg-endary La Mamounia in Marrakesh –some of Garcia’s past projects.
James Price, head of international res-idential developments at Knight Frank,
says: “This is the first whole completedresidential building to be built inMoncao for some time. Opportunitieslike this don’t come round often there.”
Nor do they come cheap: think €45,000 per square metre. Flats on lowerfloors start around €6m, while the big-ger, higher up apartments that Price saysare being marketed towards “a moreinternational clientele” (meaningIndian, Chinese and Brazilian) come inat the mid-teens. But if you’ve got thecash, this is a secure and rather specialplace to put it.
www.knightfrank.com
Top left: arooftopexperience.Bottom left:the building’sexterior andleft: a dining
room in one of theapartments.
25
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This 18th century ware-house, formerly ownedby the East IndiaCompany, has been con-verted into 14 contempo-rary apartments. Thepenthouse offering 2,870square foot of space isnow on the market. Ithas three bedrooms, alarge reception room, afully-fitted kitchen andtwo bathrooms. Contact: Savills on 0207 283 7678 or go to www.sav- ills.co.uk
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City living: quitthe commuteIf you feel like you live at work, why notmove in? The Square Mile hides homesthat offer a comfortable and convenientway of life, writes Donata Huggins
BREAD Street, Poultry, Oat Lane– it doesn’t take a genius toguess that the City is about business. It’s certainly not the
first place you imagine yourself liv-ing when you arrive in London.Indeed, the aldermen are trying tostop David Cameron’s attempts toturn it into a more residential area by relaxing planning rules.
But Carl Davenport, Chesterton
Humberts’ City expert, says the reno- vation of Cheapside and the One New Change shopping centre are signsthat it’s already happening.
Although he adds that the existingproperty market remains relatively undiscovered, say Davenport. “People just don’t seem to know where thedevelopments are. There are secretpockets of great properties every- where in the City.”
Prices are a mystery too. “Theplaces on the periphery that requirea commute – Tower Bridge, Islingtonand Shoreditch – are practically the
same price.” And with just 10,000homes in the Square Mile, prices arelikely to stay steady. Perhaps now isthe time to quit the commute?
This could be your neighbourhoodPicture: Reuters
FROBISHER
CRESCENT, THEBARBICANPrice: £565,000This 528 square foot,one-bedroom apart-ment is on the ninthfloor within theBarbican. Its interiorsare highly stylised witha private balcony andwood paneling. It hasstunning views acrossthe London skyline.Contact: Frobisher Crescent on 020 7288 033 or go to www.fro- bishercrescent.co.uk
Karen AllenLLOYD'S BROKER
I got my first job in the City in 2001 after graduat-ing from Queen Mary College. There was no temp-tation for me to move away from Bethnal Greenwhere I had lived as a student. It’s a great areaDespite its lack of gentrification back in 2001, thearea was a very attractive 20 mins walk toLiverpool Street. Other than a four year stint Ispent in Blackheath, I have always lived withinwalking distance of the City. The ease of being ableto walk into the office and the pleasantness of thestroll in through Spitalfields is something I'm notprepared to sacrifice. Even if that means I neverhave an excuse to be late on snowy days when train
services are disrupted.
After travelling for more than an hour to work from myhome in Sydney, I vowed that I would not live so farfrom the office once I moved to London. Now my com-mute is 15 mins by foot. I work long hours, so a reliablyshort commute is ideal. We love living walking distanceto so many great places in London. In the evening,there’s nothing better than walking to a restaurant,catching a show and then strolling home along theriver bank. But the city is rapidly developing a life of itsown and now on weekends we tend to stay local, visit-ing the Barbican and settling in at Exmouth Market fora snack and some weekend reading. The best part?When I have to work late, my husband can pop up to
CHIPPENHAMROADPrice: £325,000This attractive one-bedroom, first floorflat has neutraldecor throughout.It has a receptionroom with highceilings, a smartopen-plan kitchenand sizeable bed-room, en suitebathroom andample storage.Contact: Foxtons on 020 7449 6000 or go to www.fox- tons.co.uk
CLIFTON GARDENSPrice: £7.95mThis spacious family home has a private garden with direct access to a four-acrecommunal garden. The property itself has a lift, a private patio, roof terrace, self-con-tained staff quarters and off-street parking for two cars.Contact: Knight Frank on 020 7586 2777 or go to www.knightfrank.co.uk
Commuting: Commuting to the City from MaidaVale takes 25mins on the Bakerloo Line, changing tothe Central Line at Oxford Circus to reach Bank.Getting to Canary Wharf only takes six minuteslonger, travelling on the Bakerloo Line to BakerStreet then changing onto the Jubilee Line.
Leisure: Maida Vale is a great place to eat and drinkwith the Summerhouse, the Pearl Liang and Gordon
Ramsey’s The Warrington for food and the thePrince Alfred for drinks.
NEED TO KNOW | AREA INSIGHTMAIDA VALE, W9 BY DONATA HUGGINS
London average £430,258 £448,423 £340,317 £476,985
Source: Savills
ELGIN AVENUEPrice: £1.75mThis three-bedroom apartment in the heart of Maida Vale is finished to a highstandard. The property offers three bedrooms, two bathrooms, a kitchen diningarea and a reception room opening onto a the garden.Contact: Chesterton Humberts on 020 7286 4632 or go to www.chestertonhum- berts.com
ASHWORTH ROADPrice: £4.25mThis property has had the interior design treatment. It has five bedrooms, four bath-rooms, a cinema room, a landscaped garden, a dining and reception room.Contact: Savills on 020 7472 5020 or go to www.savills.co.uk
Q.I hear that some land-lords are introducing“break clauses” to take
advantage of premium shortlets over the Olympics. Is thissomething you advise?’
A.Be careful, the Olympicslasts only 16 days. If yourproperty is an investment,
you need to ask yourself whether itis cost effective to have the proper-ty vacant before and after theOlympic let. If you are renting, havean immaculate family house or largeflat in central London, however, thenthis might be a better idea sinceshort lets usually command up to 30per cent more than long lets. Thiscould increase to 50 per cent withthe Olympics, depending on the typeof property. If you’re keen on doingthis, check with your local Council,insurance company, landlord andmanaging agent to see if you areallowed to accommodate short lets.
Q.With autumn approach-ing, how easy is it to givemy home a new look for
the new season?
A.My property has been onthe market for six monthsnow without securing a
buyer. Should we think about offer-ing it for both sale and for rental?
This can be tricky since you willprobably have tenants in residencewhile you market the property. This
gives you two options: you caneither have tenants and wait a fullyear to re-market it or offer it totenants on a short letting agree-ment. If you opt for shorter tenan-cies, remember that you will havemore frequent periods without ten-ants and therefore make less money.Also, you will need to give more of your time to the project. You willhave to organise inventory checks,cleaning and viewings with yourtenants.
These might not be the onlyoptions though. If you target prop-erty investors, they might well beattracted to the fact you have ten-ants in situ – they will see them aseasy and valuable revenue genera-tors.
Contact: Aylesford International on 020 7351 2383 or go to
www.aylesford.com
CURRENT MORTGAGE DEALS BY DONATA HUGGINS Source: MoneySupermarket.com
Lender Fixed/Flexible Rate Until apr Maximum Loan to(per cent) (per cent) Value (per cent)
Santander Flexible 1.95 2 years 4 60
Skipton BS Flexible 1.98 2 years 4.8 60
Chelsea BS Flexible 1.99 September 2013 4.9 60
First Direct Flexible 2.09 2 years 3.6 65
Santander Fixed 2.35 November 2013 4.1 60
Chelsea BS Fixed 2.39 November 2013 5.4 70
Leeds BS Fixed 2.45 October 2013 5.4 60
ING Direct Fixed 2.69 November 2014 3.5 60
Yorkshire BS Fixed 2.79 November 2014 4.5 75
FIRST GLIMPSE OF NEW PRIVATE ISLAND DEVELOPMENTEarly lot prices have been announced for Pearl Island, the private Pacific island just an hour byboat from Panama City. The island’s 30km of unspoilt coastline is being transformed into a lux-ury development. Prices range from $800,000 to $2m and are between one and two acres insize. For more information visit www.pearlislandliving.com.
PROPERTY NEWSBY DONATA HUGGINS
LONDON’S RENTAL MARKET BOOMLondon’s rental market continues to soar. An average of five tenants compete for everyrental property at the moment, says London estate agent Greene & Co. This has had newlandlords flooding into the market. Mortgage valuations carried out in August shows an85 per cent increase in buy-to-let landlords next year.
Q A&CatherineCockcroftHEAD OF RENTALSAT AYLESFORDINTERNATIONAL,A TOP END SALESAND LETTINGS AGENCY
Weather forecasters are predictingshowers for the match and that won’t helpgetting the ball out to the backs. It alsomeans kicking would come more intoplay, potentially keeping a check on thescoring.
Fans may recall the last time these sidesmet at Twickenham 10 years ago –England won by a staggering 134-0 mar-gin. However, we’ve seen from the open-ing games in this tournament that thesecond-tier nations have improved signifi-cantly.
Many would have expected England tocrucify the Georgians, but they were only 17-10 ahead at the break – before it eventu-ally finished 41-10. The average winningmargin in all of Pool B’s matches current-ly stands at just 18 points.
Winger Chris Ashton ended a run of six
straight matches without a try with a brace against Georgia. The Northamptonflyer looks to be approaching his best andhe’ll be hoping to add to his tournamenttally against a Romanian side that has losttheir first two fixtures. I’m confidentenough that Romania will keep withinthe 53-point handicap.
However, they have tired towards theend of their matches and that’ll open upspace for the likes of Ashton – a buy of histry minutes is a tempting bet at 65 withSporting Index.
NEW Zealand and France have playedout some epic matches over the
years, so rugby fans’ eyes every- where will have lit up when they
were drawn together in Pool A. The hosts came into the tournament
with successive Tri-Nations defeats, butnow look to have found their feet with two
wins from two. Pool A was always going torest on this match and the All Blacks,huge 1/10 favourites with Ladbrokes, will
be bullish following a dominant display against Japan.
The contest against Les Bleus will be thefirst opportunity to see how the Kiwis han-dle the pressures of playing against a topside in front of their supporters. To help,captain Richie McCaw returns to lead outthe side for his 100th cap and Dan Carteralso slots back in.
Marc Lievremont has made a number of changes and has chosen to pair MorganParra with scrum half Dmitri Yachvili,after dropping Francois Trinh-Duc.Despite two unconvincing performances,France go into the clash level with the AllBlacks having struggled past Japan 47-21and then Canada 46-19.
These two nations produced one of the best rugby games ever at the 1999 Rugby World Cup when the All Blacks conspiredto blow a 13-3 half time lead, eventually losing 20-18. The two nations have met on50 occasions and the All Blacks lead thehead-to-head 37-12, with a lone draw. They also have the momentum, given they wonthe last three meetings. The most recentcontest was settled by 27 points, but thetwo previous games were both decided by
just four points. Though the French are unlikely to upset
New Zealand, they can be expected to get within the 17-point handicap set by Ladbrokes at 10/11.
Although England have won both theirPool B matches, neither victory wouldhave struck fear into their tournamentrivals. Martin Johnson’s troops have beenlet down by ill-discipline that has seen yel-low cards handed out in each of theirmatches. The Red Rose have a chance toget it right tomorrow morning when they take on Romania in Dunedin.
POINTERS...
France to win (+17) at 10/11 with LadbrokesRomania to win (+53) at Evens with Paddy PowerBuy Chris Ashton’s try minutes at 65 with SportingIndex
Carter’s return can helpAll Blacks edge thriller
Punter | Sport
32
RUGBY TRADER DAVID WILD PREVIEWS THIS WEEKEND’S BIG GAMES
THE sign of a good side is always onethat manages to win when not play-ing well. Now, I’m not saying thatManchester United didn’t play well
against Chelsea last weekend, but they cer-tainly weren’t outstanding. They gave theBlues plenty of chances and although they ended up scoring three, it was nowherenear as good a performance as when they
beat Arsenal at Old Trafford last month.Stoke got stuffed at Sunderland last
week, but that was their first leaguedefeat of the season and they would haveregained some confidence by beating
Tottenham on penalties in the CarlingCup on Tuesday night. Tony Pulis’ side sitfifth in the league which isn’t bad seeingas their two home games so far have beenagainst Chelsea and Liverpool. Other thanthe Sunderland game, they have beenextremely solid at the back and are yet toconcede at home in their two league con-tests.
Football Form Labs analysis shows that,in the Premier League era, only five of 21
sides to win their first two away gameshave gone on to win their third. Unitedalso only managed to win five of 19 away fixtures last season and have won just oneof their last eight away visits to top-half opponents. It is true that the championshave won all six games against Stoke sincethe Potters were promoted, but I can seethat run coming to an end tomorrow evening.
The draw is available at 3/1 withLadbrokes and that is worth snapping up,
while I also wouldn’t put anyone off back-ing no goalscorer at 14/1 with Skybet. Stokehave conceded just one goal in five homegames across all competitions this season.
There is obviously a risk with this, seeing asUnited’s five league games have averagedfive goals per game, but I think this one
will be tight and spread bettors should sellgoals at 2.8 with Sporting Index.
Everton have undoubtedly beenManchester City’s bogey team in the past
four years. The Toffees have won seven of the last eight league meetings, including
their last four trips to Eastlands. However,as we all know, this is a completely differ-ent City side and they are undoubtedly titlecontenders.
Roberto Mancini is unbeaten in 13games as City boss in their next game fol-lowing a draw and they have recordedHT/FT victories in eight of the last 11 suchcontests. They have also won by the HT/FT double result in their last five home match-es against top-half sides and have won theirtwo home games this season, scoring sevenand conceding none.
The Toffees have been losing at the break in five of their last 10 on their travels and I
will be backing City to win another by theHT/FT margin at 11/10 with Ladbrokes.
POINTERS...
Stoke v Manchester United draw at 3/1 with LadbrokesNo goalscorer at 14/1 with SkybetSell total goals at 2.8 with Sporting Index
Manchester City HT/FT v Everton at 11/10 withLadbrokes
FOOTBALL TRADER BEN CLEMINSON TAKES A LOOK ATTHE BEST BETS OF THE WEEKEND
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Jeremy Noseda’s Dare To Dance has justsneaked into the race and he could be very
well handicapped. He is almost certain togo off favourite and obviously holds astrong chance of winning, but it’s not easy for three-year-olds to land this and the lasttwo winners were experienced handicap-pers.
RED GULCH is only a four-year-old, buthe has plenty of races under his belt andhas been in flying form this season, win-ning two well-contested handicaps in his
past three runs. He’s drawn in stall four onthe far side, which we don’t know
whether will be an advantage, but I’ll be backing him each-way at 16/1 withLadbrokes, as well as Roger Charlton’sPROPONENT at 20/1 with Paddy Powerfrom stall 24.
Many punters will be looking atCharlton’s Cry Fury as his best chance of
winning a third Cambridgeshire, but theseven-year-old Proponent absolutely lovesit here. Second to Green Destiny in acourse and distance handicap on Guineasday, he was also runner-up to Boom AndBust at Glorious Goodwood, and is such aconsistent horse that I can’t let him gounbacked.
The highlight of this afternoon’s actionis the Group One Fillies’ Mile (3.00pm) andit’s a truly mouthwatering contest. Thereis little between Lyric Of Light and FallenFor You on their run in the May Hill, so I’mgoing to stick with an each-way bet onRoger Varian’s FIRDAWS. It’s been atremendously upsetting week for the
yard, with the death of trainer Michael Jarvis, and there won’t be a dry eye in thehouse if this filly can land the spoils.
Finally, don’t miss John Oxx’s AKEED
MOFEED in the Beresford at the Curraghon Sunday (4.25pm). He’s is the apple of his trainer’s eye and it could be worth tak-ing some of the 20/1 and 25/1 available fornext year’s Guineas and Derby.
You can follow me on Twitter@BillEsdaile.
NO horse has ever won tomorrow’sGroup One Sun Chariot Stakes(3.10pm) three times, but that could
be about to change with RodCollet’s French mare SAHPRESA. The six-
year-old has claimed the last two renewalsof this contest and probably should havetaken the Falmouth Stakes at the July Course when given a poor ride by Christophe Lemaire.
Lemaire will be in the plate againtomorrow, but he is a world class jockey
and should be able to put things right.Sahpresa clearly loves the Rowley Mile andit looks as though she will get herfavoured quick conditions.
Alanza is interesting for John Oxx judged on her Doncaster win earlier thismonth, and three-year-olds do have a goodrecord in this race. Timepiece is also a dan-ger, but she got a soft lead in theFalmouth and I think she will struggle toconfirm the form with Sahpresa.
Richard Hannon is going all out for thetrainers’ championship and he will behoping BEST TERMS can extend his lead
by taking the Cheveley Park Stakes(2.35pm). The daughter of Exceed AndExcel has surprised everyone at the yard
with her progression, but she was incredi- bly impressive in the Lowther last timeunder a penalty.
The six furlong trip should be absolute-ly perfect for her at this stage of her careerand Richard Hughes will be very disap-pointed if she gets beaten. The chief threatseems to be Ger Lyons’ Lightening Pearl,
who bolted up at the Curragh last time, but she still looks to have plenty to do tocope with the Hannon runner.
The Cambridgeshire Handicap (3.50pm)is one of the biggest betting heats of theseason and at the start of the week I was
very keen on Questioning. John Gosdenhas won two of the last four runnings of this race and often likes to target it with aprogressive three-year-old. However, he
was 14/1 on Monday and he’s now an 8/1shot which is too short.
Frankie’sThoughts
RACING TRADER BILL ESDAILE LOOKS AT THIS WEEKEND’S KEY RACING ACTION FROM NEWMARKET
Collet’s Sahpresa to makehistory in the Sun Chariot
I’VE got some decent rides this after-
noon, none more so than Lyric Of Light in the Fillies’ Mile. She’s a lovely filly and I was very impressed with her
at Doncaster. She showed some signs of greenness that day, but there should be a
bit more improvement and I hope she canconfirm the form with Fallen For You.
Poet’s Voice is a very good horse on hisday and we gave him some time off afterDubai this winter. He was carrying a bit of extra weight at Goodwood last time and
just got tired close home. That run willhave done him the world of good, we havea pacemaker in the race and if he comes
back to form, he should be thereabouts.I ride Rakasa in the first, who was just
touched off in a four-way photo atGoodwood last time, but that was a messy race. She’s very honest, has Group form inthe book and should finish in the first twoor three.
Ragsah is a nice filly who runs in theListed race, but she’s got it all to do if I’mhonest. She’s quite small and it would begreat if we could get some black type.
Man Of Action is my mount in tomor-row’s Cambridgeshire and he won welllast time at Donny. He should run okay,
but I’m not particularly pleased with hisdraw in stall 14. I’m not sure if far side orstand side is the place to be, but you don’treally want to be up the middle.l Frankie Dettori is an ambassador for
the QIPCO British Champions Series. For moreinformation, or to buy tickets, visit www.britishchampionsseries.com or call 0870727 1234.
ARSENAL captain Robin van Persiehas urged the beleaguered Gunnersto come out fighting when they resume their Premier League night-mare against Bolton tomorrow.
Last week’s defeat at strugglingBlackburn marked another low in analready testing season and promptedfresh questions about manager Arsene Wenger’s future.
But Van Persie said: “We realise thisis our worst start in the league for a while, but we have to stay together, be
strong and make sure not to hide or become introverted.”
Van Persie:
We’ll fightout of crisis
ENGLAND wing Mark Cueto insiststhe negative publicity surroundingtheir World Cup campaign has only made them more determined torepeat the heroics of 2003 and return with the Webb Ellis Trophy.
The team’s preparationsfor tomorrow’s Pool Bclash with Romania have been surrounded by controversy over the off-field behaviour of someplayers, notably vice-captain Mike Tindall.
Compounding thegloom has been a focus onthe negative aspects of theirtwo matches so far at the tourna-ment in New Zealand – an attritional win over Argentina and a flawedthrashing of Georgia.
Cueto (inset), a key figure in theside that came within a disallowedtry of retaining the trophy four yearsago, returns against Romania and believes England’s team spirit is inrude health.
“Regardless of whether it’s positiveor negative stuff, we’re always quitegood at turning that into a bondingthing. At the minute, with everything
that’s been going on, it probably hasgalvanised us a little bit,” he said.
“In a crazy sort of way, it’s quite
positive to be stood here feeling disap-pointed with how we’ve played hav-ing won two from two. There’s a hugeamount more to come. We’ve beencriticised hugely for the two perform-ances, maybe rightly so in certainareas, but ultimately we’ve scorednine points from a possible 10.”
Cueto missed the first two matches with a back injury but returns inplace of in-form Delon Armitage as
one of seven changes to theEngland team this weekend in
Dunedin. Tindall resumes his mid-
field partnership withManu Tuilagi, in place of Shontayne Hape, while
veteran fly-half Jonny Wilkinson reclaims theNo10 shirt from rival Toby
Flood. The pack features fourchanges, chiefly hooker Steve
Thompson replacing Dylan Hartley.Prop Alex Corbisiero, second row Louis Deacon and flanker Tom Crofthave also been recalled.
REVITALISED Owen Hargreavesadmits he was scared before making atriumphant Manchester City debut in Wednesday’s Carling Cup win overholders Birmingham.
The midfielder’s injury-ravagedcareer looked all but over, having barely played at all in the last three years, until City took a chance andsigned the 30-year-old free agent lastmonth.
He repaid their faith in style – andstunned those who had written himoff – with a goal and an action-packed60-minute display as the PremierLeague high-fliers booked their place
in round four.Hargreaves, who made a YouTube
video showcasing his fitness to poten-tial suitors after being released by Manchester United in the summer,concedes he felt nervous about hiscompetitive comeback but insists henever stopped believing he would suc-ceed.
“It has been three years and fourmonths – that is frightening in itself,”he said. “I am not surprised how quickly I was in contention. There was a bit of a misconception and Idon’t think people would believe meif I said everything that went on.
“I would never have anticipated allthese setbacks in my worst night-mare. You are left to pick up thepieces. That has been the biggestobstacle. It was a pretty humbling
experience but I knew this day wouldcome.”
FOOTBALL▲
Hargreaves frightened
by end of injury ordealDEFENDING champion Sebastian Vettel could clinch back-to-back titlesin Singapore this weekend but theGerman insists he is in no hurry toput the seal on another season of glory.
A maiden win at Marina Bay cou-pled with off days for nearest chal-lengers Fernando Alonso, JensonButton and Mark Webber would besufficient for runaway leader Vettel to be crowned with five races to spare.
But the Red Bull driver said:“Would, could, should – so far wehaven’t won anything. We are in agood position but still have some way
to go. Our target going into this sea-son was to defend the title. We are in
a very good position and there is noreason the target should change. Itdoesn’t matter when; it matters thatit happens.”
Ferrari’s Alonso needs a podiumfinish on Sunday to keep the champi-onship alive but despite taking thechequered flag last year, the Spaniardknows the title is in Vettel’s hands.
“This year, he has made no mis-takes or very few mistakes. Last year we had a little bit more chances,” said Alonso. “He has been the best driver,[with] the best team. They deserve to be where they are.”
Vettel holds an 112-point lead over Alonso, who is five points ahead of McLaren’s Button and Red Bull’s Webber. Anything worse than a top-
two place would end Button and Webber’s gossamer-thin hopes.
Vettel in no hurry to seal
successful title defence
Harsh glare
of spotlightfortifies us,insists Cueto
BY FRANK DALLERES
FORMULA ONE▲
Sport34
THE BREAKDOWN |WORLD CUP BRIEFS
MURRAY IN SUNDAYS PLEAScotland prop Euan Murray has
called for Sunday matches to beremoved form the calendar for reli-gious reasons. Murray, a Christian,has elected to sit out this weekend’scrunch Pool B clash with Argentinabecause of his faith. He said: “I don’tsee why there have to be games onSundays. I hope things will changein future.” Should they qualify,Scotland’s quarter-final and semi-final are also likely to fall onSundays, as does the final.
HABANA SHRUGS OFF FEATSouth Africa wing Bryan Habanahas played down the significance of breaking his country’s try-scoringrecord. Habana claimed his 39th,overtaking former scrum-half Joostvan der Westhuizen, in yesterday’s87-0 thrashing of Namibia in Pool D.“I think other people were moreworried about it than I was,” he
said. “I've said it my whole career:it’s always been about theSpringbok team. It’s never beenabout the number of tries I’ve beenable to score.”
O’GARA STAYS, SAY IRISHIreland chiefs insist veteran fly-half Ronan O’Gara has assured them hewill play on beyond this World Cup.The 34-year-old hinted last week-end that this tournament would behis international swansong. But hehas since backtracked and teammanager Paul McNaughton said: “Asfar as we’re concerned, he’s con-firmed that retirement wasn’t onthe agenda. We’re happy with that.”Ireland face Russia next on Sunday.
FRANCE TAUNT ALL BLACKSFrance back-row Julien Bonnairehas taunted New Zealand ahead of tomorrow’s Pool A showdown,insisting the All Blacks fear LesBleus. “They know we are unpre-dictable – in a good and a bad way,”he said. “We can either fail or pull itoff, and that is what they fear.”Conspiracy theorists believe Francehave not picked their strongest sidein order to finish second and avoidsouthern hemisphere teams in laterstages. But Bonnaire added:“Controversy is part of the deal. It'sup to us to prove them wrong.”
