BUSINESS WITH PERSONALITY

EX-ENGLAND STAR BACKS CITY

AWARDS
A.M.
CALAMITY KEEPER GREEN WEFORAREREADERS
NOW OPEN

WORLD CUP SPECIAL P34 NOMINATIONS P20

Issue 1,154 Monday 14 June 2010 www.cityam.com FREE

GROWTH NUMBERS BP may cut

dividend as
SET TO BE SLASHED
POLITICS
spill lingers
BP IN CRISIS
BY EMMA SADOWSKI

BY DAVID CROW BP DIRECTORS will today meet to dis-

THERE will be a quiet revolution in
British economic policy today when
the first official but independent fore-
casts for growth and public borrowing
are published.
A new Office for Budget
Responsibility, headed by Sir Alan
Budd, will unveil its initial forecasts at
10am this morning. It is expected to
sharply revise down former chancellor
Alistair Darlings growth projections.
Although it is unlikely to quibble
with Darlings 1.25 per cent growth
forecast for 2010-11, it is expected to
slash the forecast for 2011 from 3.25
per cent to somewhere nearer the
independent consensus of 2.1 per cent.
Forecasts for subsequent years will
also likely be downgraded from 3.25-
3.5 per cent to a little over 2.5 per cent.
This is line with most forecasts,
including the latest today from the
CBI, which sees growth of 1.3 per cent
this year and 2.5 per cent next year.
However, because tax revenues are
holding up better than Darling had
expected, the OBR is unlikely to hike
the projections for public borrowing
in 2010-11. It could even trim the exist-
ing forecasts. Darling said net borrow-
ing would be 163bn this financial
year in his March Budget, but
PricewaterhouseCoopers is predicting
it will be 155bn while JP Morgan
expects a figure of 145bn.
Labour sources last night said they
George Osborne (l) has asked Sir Alan Budd to head the OBR on an interim basis
would seize on any reduction in the
deficit forecast as supposed proof the
coalition has been over-exaggerating
the scale of the fiscal crisis to provide
cover for ideologically-motivated cuts.
Harriet Harman, acting leader of
the opposition, yesterday said: I think
that what the Tories are doing is
theyre trying to make out that the
deficit is worse than it is as a pretext to
go ahead with cuts in public services.
One Labour strategist last night said
the party would launch its first major
attack since it was sent into opposi-
tion, painting the coalition as ideolog-
ically-driven cutters and claiming that
large deficits are often necessary.
And Darling is expected to demand
an official apology from chancellor
George Osborne, although coalition
sources last night indicated one would
not be forthcoming. Sources close to
the ex-chancellor said he was furious
at what he sees as Tory attempts to
trash his reputation.
Meanwhile, Osborne will flesh out
Pictures: REUTERS, Micha Theiner/City A.M.
plans for an overhaul of the tripartite
regulatory system at his first Mansion
House speech on Wednesday. He is
expected to unveil proposals to hive
off the parts of the FSA that monitor
banks, insurers and other financial
firms and turn them into a semi-
autonomous subsidiary of the Bank of
England. A Financial Policy
Committee will also be created,
charged with maintaining financial
stability. ALLISTER HEATH: P2
POLITICS: P4-5
cuss whether the oil giant should
bow to pressure from the US govern-
ment and cut its dividend payment at
the same time as establishing a sepa-
rate disaster relief fund.
The meeting, which will take place
in London, will come ahead of discus-
sions in Washington between chief
executive Tony Hayward, chairman
Carl Henric Svanberg, clean-up head
Bob Dudley and US chairman Robert
Malone, and US President Barack
Obama later this week.
Directors are expected to discuss
whether the company will move to
cut its second quarter dividend pay-
out and establish an escrow account
to pay for the spill and compensate
effected individuals and businesses.
A spokeswoman from BP last night
confirmed that the board will discuss
both measures but said it is unlikely a
decision will be made today. She said
that the escrow fund, which would be
managed by a third party, is one of
the options being considered by the
board.
Obama is expected to demand that
BP set up the account with substan-
tial reserves later this week when he
makes a televised address to the US
public. BP said it had not spoken to
Obama about the fund.
Over the weekend BP was given a
48-hour ultimatum by the US Coast
Guard to come up with a better plan
to stop the oil leak entirely.

FTSE 100 5,163.68 +31.18 DOW 10,211.07 +38.54 NASDAQ 2,243.60 +24.89 /$ 1.45 t-0.02 / 1.20 t-0.01 /$ 1.21 unc Certified Distribution
3/05/10 - 30/05/10 is 106,097

250 s t*
Apply for an account today and receive up to 250 cash back* against

afety ne
any net losses made within your first 10 business days of trading.
Think fast. Trade fast > etxcapital.co.uk/ca

FFinancial
inancial Spr
Spread
ead B
Betting
etting can result
result in losses that rapidly and substantially exceed
exceed your
your initial deposit.
*Terms
*T
Ter apply.. SSee
e ms and conditions apply ee website
website for
or details.
fo details.
ETX
ETX Capital
Capital iiss a ttrading
rading n
name
ame o
off M
Monecor
onecor ((London)
London) LLtd.
td. aand
nd iiss aauthorised
uthorised aand
nd rregulated
egulated b
byy tthe
he FFinancial
inancial SServices
ervices Authority.
Authority.
 2 News
Time for an inquiry into tax system
EDITORS LETTER
ALLISTER HEATH
THERE are two conflicting trends
right now in British economic policy:
one is reassuring and invigorating;
the other negative and deeply depress-
ing. Both will help determine how suc-
cessful and prosperous the UK will be
over the next few years.
I am increasingly optimistic about
the immediate, urgent crisis facing
Britain the desperate need to stem
the budget deficit, which at more
than 150bn a year is unsustainably
high (and no, it doesnt matter if the
figure is slightly lower than predicted
by Alistair Darling, it is still scan-
7th Floor, Centurion House,
24 Monument Street,
London, EC3R 8AJ
Tel: 020 7015 1200 Fax: 020 7248 1729
Email: news@cityam.com www.cityam.com
Editorial
Editor Allister Heath
Deputy Editor David Hellier
News Editor Ben Griffiths
Night Editor Katie Hope
Associate Editor David Crow
Lifestyle Editor Zoe Strimpel
Art Director Darren Soulsby
Pictures Alex Ridley
Commercial
Sales Director Jeremy Slattery
Deputy Sales Director Harry Owen
Head of Distribution Nick Owen
Distribution helpline
If you have any comments about the distribution
of City A.M. Please ring 0207 015 1230, or email
distribution@cityam.com
Editorial Statement
This newspaper adheres to the system of
self-regulation overseen by the Press Complaints
Commission. The PCC takes complaints about the
editorial content of publications under the Editors
Code of Practice, a copy of which can be found at
www.pcc.org.uk
Printed by Newsfax International,
Beam Reach 5 Business Park,
Marsh Way, Rainham, Essex, RM13 8RS
WHAT THE OTHER PAPERS SAY THIS MORNING
THE SUNDAYS TODAY
$2.6M BUFFETT LUNCH WON BY
ANONYMOUS BIDDER
A mystery benefactor has paid $2.6m
(1.8m) to meet with billionaire
investor Warren Buffett for a business
lunch. The Sage of Omaha auctioned
his time in aid of a San Francisco
charity. This years auction brought in
25 per cent more than any bid in the
previous ten annual auctions.
BP CHAIRMAN SVANBERG LOST 1.7M
ON SHARE PURCHASES
Carl-Henric Svanberg, the chairman
of BP, has lost 1.7m on shares bought
before and after the oil spill in the
Gulf of Mexico. The former boss of
Ericsson made the disastrous invest-
ments shortly after taking on his new
job at the beginning of the year. He
bought 4.3m of shares in February,
two months before the Deepwater
Horizon rig exploded and sank.
dalously bad). The coalition govern-
ment looks as if it is serious about
tackling this and beginning to shrink
the size of the state. We will know
more after the emergency budget; we
will really only be sure when cuts are
actually pushed through in the face of
what is bound to be intense opposi-
tion over the next two years.
Todays forecasts from the Office of
Budget Responsibility, the new inde-
pendent group set up by George
Osborne, will confirm that despite
much more downbeat growth predic-
tions the cyclical component of the
budget deficit is shrinking. It will be
interesting to see what the office has
to say about the structural deficit, cre-
ated by years of over-spending; and
also whether it has calculated the real
size of the national debt, including off
balance sheet liabilities, unfunded
public sector pensions, private finance
initiative and other contracts, and all
the other buried nasties. But regard-
less of the details, the government
seems determined to tackle the deficit
BoE to ignore
rating firms
UK ECONOMY
BY JESSICA MEAD
THE Bank of England will ignore the
judgement of ratings agencies if its
own independent view suggests the
risks to be substantially greater or
smaller than the publicly-stated rat-
ings would imply, the central bank
says in its quarterly economic bulletin
published today.
It will only accept securities of a cer-
tain quality as collateral and aims to
exclude from its public facilities any
bank whose solvency or viability is
seriously in question.
Sarah Breeden and Richard
Whisker of the Banks risk manage-
ment division say in the report that
the Bank undertakes its own inde-
pendent analysis of securities submit-
ted for eligibility checking and may
deem a security ineligible even if it
MILLION POUND PAYOUT FOR OIL
CHIEF EXECUTIVE WITH NO SALES
The chief executive of a London-listed
oil explorer pocketed a $1.9m (1.3m)
bonus last year despite recording a
$96m annual loss that led its account-
ants to raise concerns about the
firms solvency. Todd Kozel, head of
Gulf Keystone, said the going con-
cern notice by Deloitte in its annual
accounts was an accounting thing.
LISTING PLAN FOR LLOYDS OFFSHOOT
Lloyds Banking Group is working on
plans for a stock market flotation of
the chain of 600 branches it is being
forced to sell by the European
Commission. The float would create a
new British bank with five per cent of
the retail banking sector and an esti-
mated market value of between 3bn
and 4bn. Lloyds, 42 per cent owned
by taxpayers, has been given four
years to sell the business.
and the recovery will be providing a
helping hand.
It is much harder to be positive
about the longer-term problem facing
Britain: we are increasingly uncompet-
itive in the global fight for capital and
talent. The looming hike in capital
gains tax will be the latest in a long
series of blows. The general public (not
to be confused with readers of this
newspaper) are not helping; a BPIX
poll for the Mail on Sunday showed 76
per cent support for doubling capital
gains tax (voters are ideologically con-
fused: they also want pay cuts for the
top 10 per cent of civil servants, as well
as reductions in foreign aid). Labour,
meanwhile, is moving further to the
left, with leadership hopeful Andy
Burnham calling for a Tobin tax on all
financial transactions yesterday, a
move which would do more to destroy
Londons economy than virtually any-
thing else one could imagine. His
opponent Diane Abbott also supports
such a tax. They dont have a clue
but then neither do many other politi-
has the publicly stated ratings.
Equally, in the event of a down-
grade of a security below a minimum-
rating criterion, the Bank may allow it
to remain eligible as collateral if the
Bank believes it remains of sufficient
quality, the report adds.
The Bank of England may also
impose haircuts on securities posted
as collateral to protect against both-
market risk and fundamental credit
risk. It says this is particularly impor-
tant for less liquid securities that the
Bank might have to hold for a period
of time before being able to sell them.
It applies additional haircuts for non-
sterling securities, model-priced secu-
rities and own-name securities. Total
effective haircuts applied to the loan
collateral portfolios of RBS and HBOS
came to 49 and 48 per cent.
It also warns that there is a risk that
long-term unemployment might rise
EU CHIEF: STRONG EURO HID CRISIS
Herman Van Rompuy, president of
the European Union, has blamed the
strength of the euro in recent years
for blinding the Eurozone to its
underlying fiscal problems. He also
criticised financial markets for over-
reacting to those economic difficul-
ties and being too heavily influenced
by rumours and prejudices.
BARCAP TO COMPETE IN DARK POOLS
Barclays Capital, the investment bank-
ing unit of UK-based Barclays, plans to
launch a pan-European dark pool
trading platform as it completes an 18-
month drive to build an equities trad-
ing business from scratch. The move is
designed to match its presence in the
US, where it bought the equities busi-
ness of Lehman Brothers, and build a
global presence in equities trading.
cians on all sides of the House.
The drip-drip of firms moving oper-
ations, legal domiciles, capital or staff
out of the UK has become as relentless
as it is underplayed. It emerged this
weekend that Zurich Financial
Services, a key player in the City, is
looking to create a single headquar-
ters for its European life assurance
business in Dublin. Britains ever-high-
er taxes are not a global phenomenon:
Viktor Orbans new government in
Hungary wants to introduce a flat rate
of income tax of just 16 per cent above
a tax-free personal allowance.
Weve had our fill of banking
inquiries. Rather, we need a tax and
competitiveness inquiry, commis-
sioned by George Osborne, tasked
with designing a tax system where
work, thrift and investment are no
longer penalised. Progress is being
made on the deficit but we also des-
perately need a supply-side, private
sector revolution to fill the void left by
our soon-to-be retreating government.
allister.heath@cityam.com
Bank of England governor Mervyn King
further, given the increase in the job-
less rate to eight per cent and the
uncertainty about the labour market.
Analysts at the Banks Monetary
Assessment and Strategy Division
warn: a more prolonged period of
REDUNDANCY FEARS AS RESOLUTION CLARIDGES OWNER MAYBOURNE
BUYS AXAS UK LIFE BUSINESS GOES IN SEARCH OF 610 TO REFI-
Fears are mounting that Resolution's NANCE DEBT
proposed 2.8bn deal to buy Axas UK
life assurance business will trigger sig-
nificant job losses dealing yet anoth-
er blow to the beleaguered financial
sector. Roughly 2,000 employees of
Axas 15,000 UK workforce will be
transferred to Resolution, said peo-
ple familiar with the matter.
ALUMINIUM OVERSUPPLY KEEPS THE
LID ON PROSPECTS FOR NOW
Many analysts have been bearish on
prospects for aluminium for some
time because of an oversupply, but an
increasing amount of positive com-
ment has been building after last
months price plunge. Three-month
aluminium futures traded on the
London Metals Exchange (LME)
peaked on 15 April and have fallen
23 per cent since then.
CITYA.M. 14 JUNE 2010
NEWS | IN BRIEF
RBC in talks with UK banks
Canadian bank RBC is understood to be
looking to expand in Europe and is hav-
ing talks with a view to acquiring a bou-
tique investment bank in London.
Co-head of RBC Capital Markets, Doug
McGregor, spent last week in the capital
meeting potential acquisition targets.
The talks are so far only exploratory, but
RBC is thought to be keen to buy in
London as it believes the purchase could
help speed up the banks expansion. So
far this year RBC Capital Markets has
hired more than 530 staff around the
world, including 140 in Europe.
Private equity back in vogue
Private equity investors are planning to
commit more to the asset class over the
next 18 months despite most having
seen weak returns from their invest-
ments, according to a new study. Nearly
two-thirds of investors plan to acceler-
ate new commitments to private equity
funds over the remainder of 2010 and
2011, private equity firm Coller Capital
said in its Global Private Equity
Barometer, released today. The plans to
increase investments come in spite of
falling returns.
Picture: REUTERS
above-target inflation could increase
the risk that inflation expectations
rise. Long-term expectations have
remained well-anchored but near-
term predictions have risen sharply.
INFLATION: P18
The company that owns the five-star
Claridges, Connaught and Berkeley
hotels in London needs to refinance
more than 600m of loans before the
end of the year to avoid falling into
the hands of its banking creditors.
The three hotels, which each trace
their history back more than 100
years and whose guests have included
royalty, Hollywood stars and celebri-
ties from Queen Victoria to Cary
Grant and Audrey Hepburn to
Madonna could be up for sale.
SPANISH BANK SANTANDER ON
TRACK TO BUY 318 RBS BRANCHES
Santander, the bank that bought
Abbey National, is set to acquire 318
high street branches from the Royal
Bank of Scotland as the only bidder
left in a sale process that ends today.
CITYA.M. 14 JUNE 2010
Debt crisis echoes subprime
ECONOMY
BY HARRY BANKS
THE debt crisis hitting southern
Europe resembles the 2007 subprime
crisis more than the financial crisis fol-
lowing the collapse of Lehman
Brothers, a report by the Bank for
International Settlements (BIS) said
yesterday.
In its quarterly review, the bank also
said investors were concentrating on
signs of stress in the financial system
and neglecting positive economic
data.
Petrobras to
raise $25bn
in rights issue
ENERGY
BY MARION DAKERS
BRAZILIAN national oil company
Petrobras is preparing a $25bn
(17bn) rights issue to raise funds to
explore lucrative pre-salt oil fields.
The rights issue could take place as
early as next month, and would be
the worlds biggest so far this year.
Petrobras has planned a $220bn
(151bn) investment scheme in the
pre-salt fields over the next five years,
and hopes to raise $25bn from minor-
ity shareholders to kickstart develop-
ment.
Under the deal, the Brazilian gov-
ernment will sell the rights of up to
5bn barrels of oil and gas to
Petrobras, which would use the assets
as the basis for a share issue and as
leverage for additional loans.
The swap enables Petrobras to
retain debt to equity ratios below the
35 per cent required to retain its
investment grade credit rating.
The Brazilian press has reported
that the government will also step in
The Greek downgrade on 27 April
and the subsequent market reaction
may have more in common with the
start of the subprime crisis in July
2007 than the collapse of Lehman
Brothers in September 2008, stated
BIS, which is chaired by Bank of France
governor Christian Noyer.
Rising Libor-OIS spreads and the
dislocations in US dollar funding mar-
kets recalled events in July-August
2007, when global interbank and
money markets began showing clear
signs of stress.
The report said investor confidence
to buy any leftover shares from the
rights issue. The state currently owns
a 40 per cent stake in the firm.
The pre-salt fields were discovered
off the coast of Brazil in 2007 and
take their name from the hard layer
of salt above the oil deposits.
Petrobras and Brazilian oil regula-
tors have both commissioned inde-
pendent valuations of the oil, which
will not be completed until after the
rights issue is completed.
The firm already produces a quar-
ter of the worlds deep water oil, and
stands to benefit from slower produc-
tion in the Gulf of Mexico following
the Deepwater Horizon spill.
The company last week signed up
Citigroup, Itau Unibanco, Bank of
America, Morgan Stanley, Bradesco
and Santander to manage the sale.
It will hold an extraordinary share-
holders meeting on 22 June to
approve the capitalisation plans.
The government passed laws to
approve the deal last week, putting
in place regulations for exploring
the pre-salt fields.
fell sharply in the past three months
amid concern about weaker growth
and fiscal problems. Investors lowered
their risk exposure. Concerns about
public debt in developed countries,
the state of financial markets and pol-
icy tightening have fuelled fears.
BIS, chaired by
Christian Noyer, says
the Eurozone debt cri-
sis resembles the 2007
subprime crisis.
HOUSEBUILDING COLLAPSE WARNING
THE National Housing Federation (NHF) has warned the number of new affordable
homes built this year could slump by 65 per cent to 20,390 because of funding cuts and
planning changes. The NHF has urged housing minister Grant Shapps (above) to ensure
the government honours spending commitments on new housing schemes. Picture: REX
Obama leads push to hike
US government spending
WORLD ECONOMY
PRESIDENT Barack Obama and his
aides are stepping up a push for fur-
ther government spending to boost
the economy as signs grow of the
recoverys fragility.
The White House is calling for
Congress to urgently pass measures
to extend jobless benefits, aid cash-
strapped states and provide targeted
tax breaks to encourage research and
News 3
development by businesses.
Senate Democrats have already
introduced legislation that would
renew expiring unemployment bene-
fits, and extend business and individ-
ual tax breaks. They would offset
some of the bills costs by raising
taxes on hedge fund managers and
other steps.
Meanwhile Republicans have cast
the administrations policies as fiscal-
ly reckless.
NEWS | IN BRIEF
French deficit target on track
European Central Bank board member
Christian Noyer yesterday said Frances
aim to bring its budget deficit down to
three per cent from eight per cent of
GDP by 2013 was realistic. Noyer was
echoing a similar pledge by Prime
Minister Francois Fillon at the weekend
who said France planned to cut its
deficit by 100bn (83.2bn) over the
next three years, in part by slashing
expenditures and eliminating tax
exemptions.
No prize for honest leaders
A $5m prize for former African leaders
who set examples of honest, democratic
government will not be awarded for a
second year running, the sponsor said
yesterday. Mo Ibrahim, a Sudanese-born
telecommunications entrepreneur,
founded the worlds largest individual
award as a way to encourage good gov-
ernance in a continent blighted by cor-
ruption and a frequently loose
adherence to democratic principles. A
seven-member prize committee, chaired
by former United Nations Secretary-
General Kofi Annan, met on Saturday
but did not select a winner, the Mo
Ibrahim Foundation said. The committee
did not choose a winner last year either.
It told the foundation there had been no
new candidates and so no winner had
been selected.
Paternoster hires for valuation
British pension buyout firm Paternoster
has hired bankers to put a valuation on
the company, the Independent on
Sunday reported. It said Deutsche Bank,
the largest shareholder, is likely to buy
out investors and merge the business
into its Abbey Life insurance operation.
4 Politics
David Davis (left) Vince Cable and
chaired the com- Claire Spottiswoode
mission, John both sat on the
McFall sat on it commission
Sack unethical
bankers, says
commission
POLITICS
BY DAVID CROW
BANKERS that have behaved unethi-
cally should be struck off by a new
professional standards board, accord-
ing to an influential commission into
the banking industry.
The Future of Banking Commission
released its long-awaited report yes-
terday, with a radical blueprint for
the industry in the wake of the finan-
cial crisis.
It recommends that a new body
should be created to police bankers,
taking its cue from the General
Medical Council that has the power
to strike doctors and nurses off.
And the commission, chaired by
Tory MP David Davis, says that bonus-
es should be linked to performance
over a five-to-ten year period not
return on equity or higher earnings
per share.
All banks should be forced to draw
up living wills to prepare for poten-
tial failure, the commission said,
while an international agreement to
hive off investment banks from retail
banks should also be pursued.
AT A GLANCE | KEY RECOMMENDATIONS
Resolution regimes
Introduce living wills that allow banks to
fail. Core deposit and lending functions
should be ring-fenced with own balance
sheet, liquidity and funding mechanism.
Breaking up universal banks
Prohibit banks that advise clients from
trading any form of securities. Retail and
investment banks should be separated as
part of international agreement.
Derivatives trading
All securities above a certain size should
only be tradable if registered on a system
like the Stock Exchange Daily Official List.
Traders must disclose material positions
in a company, whether held as stock,
options or other derivative, or whether
short or long. Probe into dark pools.
Remuneration
No rewards for increasing return on equi-
CITYA.M. 14 JUNE 2010
Commenting on the report, Davis
said another banking crisis would
break the country.
He added: If we dont do some-
thing along these lines, the next time
this happens well go bankrupt. Itll
all be over well make Iceland look
like a successful economy.
Treasury officials said they wel-
comed the report as a contribution
to debate but played down its signifi-
cance, pointing out the government
has just launched a similar commis-
sion.
Sources close to the commission
said its report would be taken serious-
ly because Vince Cable, now business
secretary, was one of its authors.
But Cables spokesperson refused
to say whether he backed all of its rec-
ommendations. Hes not distancing
himself from it, but it would be inap-
propriate to comment on something
he did in opposition now that hes in
government, she said.
The British Bankers Association
said the industry had already started
tackling many of the
commissions con-
cerns
ty or earnings per
share. Link rewards
to performance
over 5-10 years.
Rewards for senior
execs in retail
banking should be linked
to customer satisfaction. Front line sales
staff to get no sales-related bonus.
Code of conduct for banking
Create a Good Financial Practice Code,
similar to code of conduct for those in
medical professions. Bankers should be
trained to behave ethically.
Depositor protection
50,000 limit should be extended to pro-
tect deposits with different brands owned
by same parent. So a customer with an
Abbey and an Alliance & Leicester
account both owned by Santander
would receive a combined 100,000.
CITYA.M. 14 JUNE 2010
Law on health
and safety set
to be reviewed
POLITICS
BY DAVID CROW
HEALTH and safety red tape that
costs businesses billions of pounds a
year could be slashed.
The Prime Minister will today
announce the appointment of Lord
Young as health and safety tsar,
charged with finding a sensible new
approach to avoid overwhelming
businesses with red tape.
Lord Young, who was the special
adviser that helped Sir Keith Joseph
usher in privatisation in 1979, said
he would inject common sense
into rules that have become a mas-
sive burden on businesses in recent
years.
Young will also be asked to investi-
gate the growth of Britains compen-
sation culture, which has led to a
huge increase in so-called ambu-
lance chaser law firms that target
employees involved in work-related
accidents.
David Cameron said: The rise of
the compensation culture over the
last ten years is a real concern, as is
the way health and safety rules are
sometimes applied.
He added: We need a sensible new
approach that makes clear these laws
are intended to protect people, not
overwhelm businesses with red
tape.
Lord Young said health and safety
legislation was essential in some
industries, but that it had become an
unnecessary burden on firms and
public sector organisations.
I hope my review will reintroduce
an element of common sense and
focus the regulation where it is most
needed. We need a system that is pro-
portionate and not bureaucratic, he
added.
According to the Forum of Private
Business, small and medium-sized
companies spend over 2bn-a-year to
comply with existing guidelines.
However, it is not clear how much
power Cameron actually has to roll
back health and safety legislation, as
many of the laws are dictated by EU
directives.
Politics 5
Top two defence
officials given
marching orders
POLITICS
BRITAINS top two defence officials
will step down later this year, the gov-
ernment said yesterday, but denied
they were being blamed for mistakes
in Afghanistan or for wasteful mili-
David Cameron has tary spending.
appointed Lord Britains most senior military offi-
Young to investi- cer, chief of the defence staff Jock
gate health and Stirrup, and Bill Jeffrey, the top civil
safety legislation servant at the Ministry of Defence, are
expected to leave towards the end of
Pictures: PA, Micha the year once a strategic defence
Theiner/City A.M. review (SDR) ordered by the new gov-
ernment has been completed.
Weve talked about the best time
to be replacing our senior staff, proba-
bly at the end of the SDR in the
autumn, defence secretary Liam Fox
said.
The strategic defence review will set
out the future role of the armed forces
and may pave the way for cuts in
defence spending as the Conservative-
Liberal Democrat government moves
to rein in the budget deficit.
The changes at the top of the
Ministry of Defence are designed to
improve the militarys performance in
the Afghanistan war and to cut waste-
ful spending.
Fox would not rule out a cut in
troop numbers after the review, say-
ing he had no preconceived view on
the size and shape of the forces.
6 News CITYA.M. 14 JUNE 2010

Business support continues

to flood in for CGT campaign
CITY A.M.
CAMPAIGN
BY VICTORIA BATES
MORE business leaders have added
Betfairs Ed Wray, their voices to the growing body of
(left) and Vestra support behind City A.M.s campaign
Wealths David against the governments proposed
Scott are against
hikes to capital gains tax (CGT).
a CGT hike
Ed Wray, the entrepreneur who co-
founded Betfair, has backed the cam-
paign, claiming that the planned
increases to CGT are likely to be self-
defeating, discouraging enterprise
and investment in the UK.
We must encourage entrepre-
neurs to shoot for the stars, but by
capping the relief they get from high-
er CGT rates we are restricting them
to shooting for the top of the trees at
best, Wray told City A.M. We are
never going to build the next genera-
tion of world-leading businesses in
that environment.
David Scott, who headed up the
wealth management and stock-
broking divisions of UBS in London
before founding independent wealth
manager Vestra Wealth in 2008, also
pledged the support of his firm.
The government should ensure
they focus on encouraging growth,
he said. We believe the proposed CGT
changes, especially for entrepreneurs,
will damage growth prospects.

2010 Continental Airlines. Inc.

Hiking capital
FOOD, FINE WINE AND gains will just
ENTERTAINMENT.
ITS US IN FESTIVAL FORM.
hit aspiration
CGT also clogs up capital markets.
Nobody is compelled to sell an asset so
uncompetitive rates of CGT will sim-

ply encourage those who do not need
BusinessFirst . to realise their gains to switch into
other assets or securities.
Moreover, high rates of CGT reduce
Where a little difference makes all the difference. turnover and liquidity levels in the
GUEST COMMENT stock market. In turn the most suc-
Weve adapted our in-ight experience for the stage, bringing you great food
and wine as you relax and enjoy the entertainment. We should point out MARK FIELD cessful growing companies will find it
more difficult and expensive to raise
that our full 180 recline, 66 at bed seat is strictly available on capital.

ights, not at the festival. Welcome to BusinessFirst. Where
a little difference makes all the difference. Flying four
times a day, from Heathrow to Newark Liberty
International Airport, our New York area hub.
For reservations and information,
go to continental.com.
Lead Sponsor
L
IKE many MPs, I have received an
avalanche of letters and emails
from angry and perplexed con-
stituents since the rise in capital
gains tax was floated.
These do not come from the ranks
of the super wealthy or short-term
City speculators. Instead, my anxious
correspondents are predominantly
people who have done the right
thing those who have worked to
build up a business, employees who
invested in their company, workers
close to retirement who painstakingly
acquired small share portfolios or
those who, having lost trust in pen-
sions, turned to property as a safe
haven for their retirement fund.
In short, rather than representing a
neat redistributive tax from rich to
poor, the proposed rise in CGT risks
squeezing those caught in the middle
and stifling aspiration and self-
reliance to boot. That is why I am
today backing the City A.M. CGT cam-
paign.
Capital gains have hitherto been
taxed at a different rate from income
for good reason. They come from
investments which inevitably involve
risk. Reduce the incentives to make
those investments and you will find
there are some unwelcome knock-on
effects.
First, strong and growing
economies depend upon high levels of
investment. Higher levels of CGT will
only serve to reduce the pool of sav-
ings available for future capital invest-
ment.
Second, capital is highly mobile. For
that reason economic competitors of
the UKs such as Australia, New
Zealand, Switzerland and the
Netherlands, have abolished CGT.
They recognise that high capital gains
tax rates discourage investment.
So if the headline rate is to rise to or
near to 40 per cent for non-business
assets, restoring a complicated regime
of allowances and reliefs to take
account of the effects of inflation and
length of time over which chargeable
assets have been owned sadly might
prove an unavoidable compromise to
part-protect the interests of the pru-
dent and the elderly, long-term
investor.
And whilst business secretary Vince
Cable assures us that the proposed
higher rates of CGT are designed at
essentially private capital gains,
financial capital gains and second
homes, he perhaps fails to appreciate
fully that many second home owners
have sought to save in such an asset as
a consequence of widespread lack of
trust in pensions and other financial
products.
Similarly, he seems not to have
taken into account the disproportion-
ate impact higher rates on property
will have on Londoners and those in
the Home Counties. Many people who
buy a second home outside the capital
as an addition to a small London base
do so not because they are enormous-
ly wealthy but precisely because they
are not. It is virtually impossible even
for many of those earning multiples
of the average national wage to trade
up the property ladder in the capital.
For those with growing families, the
only option is often to buy a house
with garden outside London.
Above all, an increase in the rate of
capital gains tax may generate neither
fairness nor additional revenue.
Mark Field MP
Cities of London & Westminster
CITY A.M.
CAMPAIGN
CITYA.M. 14 JUNE 2010
Cowdery set
to pay 2.8bn
for AXA UK
INSURANCE
BY OLIVER SHAH
RESOLUTION, the insurance buyout
vehicle, will ask the London market
to suspend its shares this morning as
it negotiates a 2.8bn takeover of
AXAs UK life and pensions business.
The group, led by entrepreneur
Clive Cowdery, will also give a brief
update on talks with the French com-
pany. But a Rule 2.5 announcement
providing full details of the transac-
tion is not expected until next week
as technical discussion are likely to
run on into the coming weekend.
On Friday, Resolution confirmed its
plan to buy most of AXAs UK opera-
tions, including its protection, annu-
ities and group pensions units, and
merge them with Friends Provident.
The estimated combined embedded
value (EV) of the businesses would be
5.5bn. Cowdery aims to create a
group with an EV of 10bn by 2011.
After a month of talks, Resolution
and AXA took a break over the week-
end in anticipation of a busy week
ahead. Resolutions deal team is
being led by in-house experts Jon
Hack, a former Lazard banker, and
Elizabeth Gilbert, previously with
Goldman Sachs. Citigroup is provid-
ing some outside advice. AXA is being
advised by Credit Suisse.
Once its shares are suspended
Resolution will be freed to put the
idea to its institutional investors.
Garnering their support will be cru-
cial as they will be tapped for up to
2.8bn through a rights issue to fund
the deal. Resolution is understood to
be in advanced talks with investment
banks to orchestrate the cash call,
although none has yet been hired.
The news will placate analysts who
have lost patience with Resolutions
quest to consolidate the insurance
sector. Shares in Cowderys vehicle
have fallen 32 per cent since the start
of the year to 60.3p.
AXA UK plans to focus on its 6bn
wealth management arm should the
Resolution deal go through.
Nicolas Moreau
(left) runs the UK
division of Axa.
Henri de Castries
is group chief
executive
Picture: GETTY
CLIVE COWDERY looking for some time to realise value
from its back book, a long tail of
RESOLUTION legacy policies where contracts of
insurance have been agreed but no
terms or policy have been issued to
the customer. AXA has also been open
about its desire to plough capital into
higher-growth markets such as Asia.
A deal would ease pressure on
RESOLUTION chairman Clive Cowdery Cowdery, who already possesses a
has been a busy man. 160m fortune from the sale of the
As well as AXA, the insurance first incarnation of Resolution to Pearl
tycoon is known to have run the rule for 5bn in 2007. The 47-year-old
over the UK arms of Zurich, Aegon and aims to create value for shareholders
Legal & General in recent months. As by buying up life companies and
one market source puts it: Resolution knocking together their back office
has been talking to everybody. functions, saving money.
He had an inkling AXA would be After AXA UK, Resolution needs to
more open than most to the idea of make at least one more big purchase
divesting its British life and pensions before 2011 to meet the timeframe
business. The French group has been promised to investors.
News 7
Zurich mulls
Irish move for
UK life business
INSURANCE
INSURANCE giant Zurich has taken
another stride towards making
Ireland its overreaching business hub,
approaching the Financial Services
Authority with a view to moving the
domicile of its UK life assurance busi-
ness over to Dublin.
The move comes after Zurich last
year brought all its European general
insurance businesses under a single
Irish risk-carrying domicile.
The move is understood to be influ-
enced, at least in part, by the
favourable tax regime in Ireland,
where corporation tax is 10 per cent
rather than the UKs 28 per cent.
Zurich will continue to pay corpo-
ration tax in the UK, but dividends
then paid to the Irish sub-holding
company will be taxed at the lower
rate. Longer-term, the firm could also
reap tax benefits if the move attracts
more business through Ireland.
Zurichs decision follows a number
of firms moving over to Ireland in
protest at the UKs punishing regime,
including Shire Pharmaceuticals,
WPP and United Business Media.
Zurich continues to explore ways
to streamline its legal structure and
optimise its capital efficiency and we
have made no decisions about how
this will be achieved within our life
businesses, the insurer said.
 8 News
Sir Stelios to
meet easyJet
in High Court
AVIATION
BY EMMA SADOWSKI
EASYJET founder Sir Stelios Haji-
Ioannou will come face to face with
the budget airline today in front of a
High Court judge over an ongoing
branding dispute.
Haji-Ioannou, who is expected to
give evidence either tomorrow or
Wednesday, is taking on the airline
he set up more than 15 years ago over
a branding licence established when
easyJet floated in 2000.
The agreement saw easyJet keep 75
per cent of revenues, which it saw as
core to being an airline, while
easyGroup, which is owned by Haji-
Ioannou, would retain 25 per cent of
revenues which were made from
additional or non-core services.
Speedy boarding, baggage han-
dling fees and the sale of food
onboard are some of the services at
the focus of the dispute, which
easyJet says count as core to the air-
lines business.
Should the courts rule in Haji-
FOREX STOCKS CFDS FUTURES COMMODITIES FX OPTIONS BONDS
Saxo Bank A/S is authorised by Finanstilsynet, the Danish Financial Supervisory Authority.
CITYA.M. 14 JUNE 2010
Acas offer may
help BA ground
union dispute
AVIATION
CONCILIATION services group Acas
has sent a proposal to British Airways
(BA) and Unite that could see an end
to the long running and crippling dis-
pute.
It is understood that the proposal
Ioannous favour, it could see easyJet from Acas centres on travel perks for
either forced to ditch its orange BA cabin crew, which were removed
branding or pay out hefty royalties. by the airline during the March strike
Outgoing chief executive Andy and remain as the focal point for the
Harrison is also expected to take to disagreement.
the stand this week. He is being Acas chief conciliator Peter
replaced by GMGs Carolyn McCall. Harwood said: The proposals we
This comes on the back of increas- have put forward must understand-
ing tension between Haji-Ioannou ably remain confidential to enable
and the easyJet board, which clashed the parties to reflect on them with-
recently over plans to expand the air- out the glare of publicity.
lines fleet. Haji-Ioannou resigned Harwood confirmed that he was
from the board last month and said expecting to meet with the two par-
the airlines growth plans didnt ties early this week but said the tim-
make sense. ing and location would be kept secret
in a bid to avoid a similar incident to
ANALYSIS l Easyjet last month when the meeting was
500 p 418.00 stormed by a leftist political group.
11 Jun
480 A spokesperson for BA said the air-
line could confirm that it had been in
460 contact with Acas but would not com-
440 ment beyond that.
420
An agreement between the two
will be met with much relief by BA as
400 the airline is faced with the possibili-
380 ty of another walkout in July.
The last 15-day strike is thought to
360
15 Mar 6 Apr 26 Apr 17 May 7 Jun EasyJet founder Sir Stelios Haji-Ioannou resigned from the airlines board Picture: REX have cost BA over 150m.
OUR PREMIUM ACCOUNT*
THE PINNACLE OF PREMIUM TRADING
With our Premium Account you can enjoy a whole range of benefits and access to multiple
markets across the world.
Benefits include:
A Personal Account Manager who can be contacted by phone or online
Premium lifestyle benefits with an invitation to join Liquid Club, Saxo Banks
exclusive concierge service
Trade 155+ FX Currency Crosses, including Spot, Forward and FX Options, 6500+ Equity
CFDs, 16 Index-tracking CFDs, ETFs, Futures and Stocks from 22 Exchanges
Multiple Trading Sub Accounts perfect if youre trading in multiple markets
Direct access to a range of customised trading modules, including prices, market analysis
and charting functions
Stay up to date with relevant market news and data streamed directly to your
trading platform
Our service includes complex derivative products which carry a high degree of risk and are
not suitable for every investor. You can lose more than your initial deposit and you should
ensure you fully understand all the risks involved.
Enjoy the benefits of a Saxo Premium Account today.
For more information visit us at www.saxobank.co.uk or call 020 7151 2100
*Minimum account balance 60,000.
CITYA.M. 14 JUNE 2010 News 9

Mayor warns
The taxman is
expected to be
charged with col-
lecting more taxes
following next
weeks Budget.

against cuts Picture: GETTY

in the capital
Business prefers Vat hike over NI rise
generates around 18 per cent of the

ECONOMY
BY EMMA SADOWSKI
INVESTMENT by the government into
Londons infrastructure is crucial to
maintaining the citys competitive-
ness, according to Mayor Boris
Johnson.
Ahead of the emergency Budget,
Johnson has urged chancellor George
Osborne to avoid slashing spending
in the capital on major projects like
Crossrail and the tube maintenance.
I want to remind the government
that growth is essential to the health
of our public finances. Only by con-
tinuing to invest in London and the
South East the engine room of the
national economy will the nation as
a whole be able to grow its way out of
trouble, said Johnson.
His comments are part of a new
report commissioned by GLA
Economics, the Mayors financial
analysis arm, which found that
London receives 14 per cent of spend-
ing by the government, while the city
UKs output and tax revenues.
The report also argues that invest-
ment in infrastructure by the govern-
ment is key to increasing productivity
and output, while public capital
spending is lower in London as com-
pared to other global cities.
Johnson said: The UK cannot
afford the cost to the economy if the
capital is starved of vital investment
in infrastructure projects like
Crossrail and the upgrade of the
Tube.
He has written to Osborne ahead of
the 22 June budget and threatened
strikes by Tube Lines maintenance
workers, who are concerned over pay
and job security.
London Mayor Boris
Johnson is urging the
government to avoid
slashing infrastructure
spending.
TAXATION KPMG head of national markets be far more significant as increases in
Malcolm Edge said: To a certain Vat are either passed on to the con-
MANUFACTURING and industrial extent its a wash-through for compa- sumer by putting end prices up, or
bosses would overwhelmingly prefer nies operating in a predominantly absorbed by suppliers.
a Vat rise to any other tax increase in business-to-business environment. KPMG called on the coalition gov-
the 22 June budget, according to However, for those operating in more ernment to help business by extend-
accountant KPMG. business-to-consumer markets, it can ing corporate tax credits.
A survey of 202 executives found 61
per cent saw a Vat hike as the lesser of ANALYSIS l Tax rises- best and worst for business
several taxation evils, with a higher %
61%
levy on national insurance viewed as 60 Best
the least favourable outcome. A rise 50
in corporation tax was also deeply Worst
40 39%
unpopular with respondents.
Around 90 per cent of business 29%
30
leaders polled by KPMG came from 20%
the manufacturing and industrial 20
15%
sectors, while only 10 per cent came 9% 10% 8%
10 7%
from the retail and financial services 2%
sectors which would be more vulnera- 0
A rise in NIC A rise in VAT A rise in income A rise in More green taxes
ble to the effects of a Vat hike. tax corporation tax targeting polluters
 The Capitalist
10 CITYA.M. 14 JUNE 2010
EDITED BY
VICTORIA BATES
GOT A STORY? EMAIL
thecapitalist@cityam.com

BPS FORMER RIVAL TESTING THE

WATERS VIA THE USUAL CHANNELS
JOHN Hofmeister, the former presi-
dent of Shell, has been busy over the
past few weeks, sticking his oar in to
help former rival BP traverse the oil-
slicked waters of the post-spill Gulf.
Hofmeister has been a staunch
proponent of using giant super-
tankers to suck up the oil for pro-
cessing arguing that the same
system was used with great success
in an enormous oil spill in the
Arabian gulf many years ago.
(Apparently, restrictions on report-
ing in the area meant that said disas-
ter never reached the papers,
though if Hofmeister is to be
believed, it was around 700m gal-
lons the biggest spill the world has
ever known.)
And how, you may ask, did the ex-
Shell bigwig decide to get in touch
with the top brass at BP in the first
place to share his big idea?
I hear it was just like everyone else
by writing to the service set up by
BP so that members of the public
could give the company their
pennys worth.
Frankly, The Capitalist is impressed
that his missive even got through to
the right people, given the 30,000
responses the company is supposed
to have received so far

Ex-Shell president John Hofmeister has had some words of wisdom for BP Picture: REUTERS

unusually trim of late.

POKER FACE
A fine excuse for City A.M. to puff out
its chest, following the fourth annu-
al Rank Group City Poker Classic
tournament at the end of last week.
Around 80 players from the likes of
Merrill Lynch, Santander, Investec,
RBS and PwC turned up for the Texas
Holdem event at the Grosvenor
Wigley has lost a whopping three
stone since his last annual medical, at
which he decided it was time for him
to get healthy and slim down.
The amusing thing is that it seems
to have inspired quite a few friends,
who have always been slimmer than
me and now arent, to follow suit!
laughs the newly-svelte Wigley, pic-
tured supporting City A.M.s inaugural
awards on page 20. Competition
always has been rife in the City.

Tim Devilfish Barber in action
Victoria Casino, paying a 25 entry
fee to Marie Curie Cancer Care.
Whittled down to the final table,
who should take the honours but City
A.M.s features writer and poker
dark horse Tim Barber. A fine effort!
BOOK KEEPING
A second chance popped up on
Friday to hear outgoing M&S boss Sir
Stuart Roses selection on Desert
Island Discs, for those who missed it
last year. In case the dapper chap
needs to supplement last years
4.3m pay bonanza in retirement,
the programme throws up one idea
apparently, Rose keeps a confidential
nutters file of all the crazy and
funny letters he receives, and hes
not ruled out publishing a book of
them one day. Should bring in a few
bob, I suppose.

SLIMMERS WORLD
Speaking of congratulations, I hear
theyre also in order for banking
grandee and Yell Group chairman
Bob Wigley, whos been looking

BILL OF THE WEEK

PLENTY of boozing was on the cards last

week for this group of Knightsbridge
businessmen, who headed to Langtrys
restaurant on Pont Street for a celebrato-
ry lunch.
Our diners knocked back two bottles of
Bollinger champagne as an aperitif, fol-
lowed by two bottles apiece of 2007
Nuits-Saint George, Henri Gouges and
2006/7 Meursault Les Tillets.
After a feast of foie gras, confit of
goose, rib of beef, lamb rump and scal-
lops to soak up some of the wine, they
moved on to glasses of Taylors port and
liqueurs before ambling happily back to
the office.
 12 News CITYA.M. 14 JUNE 2010

Swiss bank UBS hands over

500 accounts in US probe
whether to allow the government to 1,550 more accounts were still being

FINANCIAL SERVICES
BY HARRY BANKS
SWISS authorities are understood to
have already handed over 500
accounts of UBS clients to the United
States under an agreement to end a
tax dispute that has threatened the
banks existence.
The Swiss lower house rejected the
agreement on Tuesday, triggering a
new parliamentary debate next week
and delaying a final decision on
hand over a total of 4,450 UBS client
accounts to US authorities.
UBS, the worlds second-largest
wealth manager, has already handed
the accounts to Swiss tax authorities
but the political deadlock threatens
to stop Switzerland handing them on
to the US by the August deadline.
Missing this deadline could lead to
the US restarting legal action.
Around 2,900 files had already
been prepared for handover and
processed, Swiss paper Sonntag
reported.
Client dossiers were transferred to
the United States in around 500 of
the 2,900 cases, the paper cited the
Swiss tax office spokesman Thomas
Brueckner as saying.
These 500 clients had signed
waivers allowing their accounts to be
handed over to the US taxman volun-
tarily. UBS and the Swiss federal tax
office did not comment.

Smile.
Flights from EC President Jose Manual Barroso is urging fiscal consolidation Picture: REUTERS

25.99 one way! EU leaders in

an attempt to
calm markets
consolidation and a new financial sta-

ECONOMY
BY HARRY BANKS bility culture in Europe, EC President
Jose Manuel Barroso said after meet-
EUROPEAN Union leaders will make a ing German Chancellor Angela
London Gatwick to: fares from new attempt this week to convince Merkel on Friday.
financial markets they can contain a There is new awareness in Europe
Nantes 39.99 debt crisis by agreeing how to tighten
economic policy coordination and
that rules have not been respected
and must now be respected.
strengthen budget discipline. Circumventing the rules... is putting
Aberdeen 38.99 The 27 EU member states and the at risk our collective economic future.
executive European Commission will We need to move in the opposite
Belfast City 25.99 also set out plans for boosting eco- direction. We need to strengthen our
nomic growth and creating jobs at a rules and the way the EU runs.
Dsseldorf 26.99 summit on Thursday, three days after
the leaders of Germany and France
Failure to show solidarity could
increase the nervousness on markets
discuss strategy in Berlin. that has helped drive down the euro
Guernsey 32.99 A show of EU unity would help per- and shares globally, and increased
suade markets the bloc has a com- worries that countries such as Spain
Inverness 34.99 mon response to the worst crisis to and Portugal could follow Greece into
hit the 16-country eurozone since the debt payment trouble.
Isle of Man 35.99 single currency was created 11 years
ago, and can prevent Greeces debt
Agreement on an aid package for
Greece worth 110bn (91.6bn) and a
problems spreading to other states. safety net for other eurozone coun-
Jersey 34.99 Our priority is putting order into tries worth 500bn has gone some
our public finances. We need fiscal way to calming investors worries.
Leeds Bradford 29.99
Q&A: EUROZONE WOES EXPLAINED
Limoges
Newquay
59.99
29.99 Q. WHAT ARE THE PROBLEMS
FACING THE EUROZONE?
gesting, among other
things, suspending
Q&A
Newcastle 31.99 A. Markets main concern is the
heavy indebtedness of periphery
countries such as Portugal, Italy,
repeat offenders EU vot-
ing rights and an insolvency proce-
dure for states.
Ireland Greece and Spain. Greece is
seen as the most endangered as it is
running a budget deficit of 13.6 per Q. WHAT ARE MARKETS GRIPES
WITH POLITICIANS?
cent of GDP, more than four times
the EU limit. A. Markets believe the EU has con-
sistently been behind the curve

BOOK NOW!
in dealing with member states fiscal

Q. WHAT IS BEING PROPOSED AT

THIS WEEKS SUMMIT?
difficulties. They have also been
angered by what they see as smoke
Keeping London on the move A. EU leaders are likely to press for
tougher rules enforcing the
region-wide budget deficit limit of
and mirrors in the way policies
have been communicated. A unilat-
eral ban on naked short-selling by
Fares are one way including taxes and charges, only available online, subject to availability. 21 day advance purchase required.
Available for travel on or before 26.03.11. Not all routes operate throughout entire travel period see website for details. Book by 24.06.10.
three per cent of GDP. Germany has Germany in May added to a sense of
circulated a nine-point paper sug- poor coordination between EU states.
CITYA.M. 14 JUNE 2010
Mid-market
firms feel the
upturn strain
for
BY OLIVER SHAH
MIDDLE market lawyers and consult-
ants are struggling to tap into the
nascent economic recovery, accord-
ing to the second monthly City
A.M./Begbies Traynor health monitor
for the Square Mile.
While bigger players are benefiting
from the return of property develop-
ment and corporate activity, our
numbers show smaller operations are
fighting to survive as clients demand
more work for lower fees.
Nearly 1,070 property services out-
fits across Greater London suffered
severe problems in May, up a third on
the previous month, while more than
1,800 assorted business services
groups showed signs of serious dis-
tress, up 57 per cent.
News 13
Joint effort
HOW THE CITYS STRESS LEVELS LOOK
ANALYSIS l Firms with significant or critical problems
vital for better
Source: Begbies Traynor
2500 2,404 Greater London
2,209
City
2000
1500
1,901
1,529 1,518
1,616
1,750
1,278
banking access
FINANCIAL SERVICES
1,104 1,060
1000 BANKS must work together with poli-
cymakers, technology providers and
non-governmental organisations
500 (NGOs) to improve global access to
financial services and boost economic
growth in the wake of the financial
On Friday, the Department for 0 crisis, a new report has found.
Transport put on ice 1.6bn of Jan Feb Mar Apr May According to the Banking for
schemes not already under contract Key: Billions report, launched today by
in one of the first austerity measures ANALYSIS l London-wide firms in distress by sector Automotive Barclays and the Economist
to have a direct impact on Londons in May Intelligence Unit, 2.5bn people across
Construction
private sector. A further 6.2bn of the globe still do not use formal or
spending cuts are due this year. I.T. semi-formal financial services,
Levels of corporate stress also rose Engineering Barclays said policy and regulation
in the City, our figures show. Nearly need to be revamped in order to
1,280 companies battled to finance Print & Packaging improve the fortunes of microfinance
themselves in May, up 20 per cent on Manufacturing institutions, which have suffered over
the previous month. Financial servic- the crisis from a lack of access to
es and IT firms were among the worst Financial Services investor capital. The bank believes
%
affected. Property Services technological advances could be
According to Begbies Traynor, the wielded effectively to widen access to
insolvency specialist, a third of the Hire/rental Services banking services in impoverished
companies picked up by our survey Recruitment areas. One billion of the worlds popu-
could fail within the next year as the lation currently own a mobile phone
Advertising
recovery strains their already-deplet- but do not have a bank account.
ed capital resources. Professional services Deanna Oppenheimer, chief execu-
Nick Hood of Begbies Traynor said: Other B2B services
tive of Barclays UK retail bank, said:
Despite encouraging talk of Mobile telephony, smart cards and
increased levels of recruitment activi- Retail electronic transfers will present a life-
ty in the City, there are still many Wholesale line to the unbanked. The challenge
potential losers struggling to cope. for regulators will be to reshape legis-
There will be many casualties as we Transport lation in ways that protect the cus-
move into the traditional post-reces- tomer, but do not hamper the
Others
sionary insolvency surge. development of innovation.
 14 News
Brit Insurance chairman John Barton is backed by his largest investors
Apollo weighs
higher Brit bid
INSURANCE
BY OLIVER SHAH
BRIT INSURANCE, the Lloyds of
London outfit, has its largest investors
backing to demand an improved
takeover offer from US private equity
giant Apollo, City A.M. understands.
The FTSE 250-listed insurer on Friday
knocked back a cash approach from
Apollo worth 785m, or 1,000p per
share, arguing it significantly under-
values the company. Apollo was last
night mulling over an improved second
offer for the firm, which specialises in
property and casualty cover.
The majority of Brit Insurances key
shareholders who include Schroders,
Third Avenue, Deutsche Bank and
Jupiter Asset Management are under-
stood to support chairman John
Bartons stance. They believe the com-
pany is worth at least 865m, or 1,100p
per share, based on market estimates
of its net tangible asset value for this
year and expectations of a rebound for
the wider insurance sector.
One major investor said: We are
exceptionally supportive of manage-
ment in rebuffing any approach that
values the business at less than its net
asset value. Theres a price at which
they would open the books up and do
due diligence, but its not 10.
A second City shareholder remarked
that recent insurance deals had been
done at more attractive multiples, but
added: If Apollo walks away the com-
pany will have some explaining to do.
Shares in Brit Insurance, which spon-
sors the Oval and Test Match Cricket on
Sky Sports, soared nearly 21 per cent to
880p after the company said it would
not enter talks unless a higher indica-
tive offer, which was capable of recom-
mendation, was forthcoming.
Apollo will try to accelerate direct
talks with Brit Insurances largest
shareholders today, it is understood.
But one barrier to a higher offer is an
employee reward scheme at Brit
Insurance, which means an extra four
million shares come into play if the
company is taken over, diluting its net
asset value. Apollo believes the scheme,
together with the cost of Brit
Insurances dividend, could make its
net asset value closer to 960p.
CITYA.M. 14 JUNE 2010 Retail News 15

London sales ...as bank holiday gives shops

up after ash in the West End a huge boost
crisis ends...
visiting the West End rose 26 per cent prospect of state spending cuts.

RETAIL
BY OLIVER SHAH
TWO strong bank holidays helped
push up West End retail sales 5.8 per
cent year-on-year in May, according to
the New West End Company, which
represents vendors in the area.
Europe, China and the Middle East. Despite a rainy Saturday, shoppers
over the weekend as metropolitan
consumers spent cash on clothes and
goods.
The months trading numbers con-
trast with those seen across the rest
of the country, where growth ticked
up a meagre 0.8 per cent on average.
According to a survey by research
Richard Dickinson, chief executive
of the New West End Company, said:
This gives a much-needed boost to
retailers in Londons West End, with
consumer confidence wobbling in
the face of the potential onset of a Vat
rise. With the additional blow of a
weakening euro, the West End needs

RETAIL
BY JOHN DUNNE
SALES in London bounced back last
month as flights returned to normal
after the volcanic ash cloud that left
thousands of tourists stranded.
Figures from the British Retail
Consortium showed sales soaring by
11.6 per cent in May compared to the
same month last year.
That compared with a meagre 0.8
per cent increase across the UK.
Over the period from March to May
London sales figures shot up by 8.8
per cent compared with 1.2 per cent
in the UK.
Sterlings weakness continued to
attract overseas visitors, especially
from those arriving from western
Clothing and footwear received a spent 38m on Bond Street, Oxford group GfK a fortnight ago, consumer to continue to improve via increased
boost from the improved weather Street and Regent Street on Monday confidence fell to a five-month low in investment in new stores and in the
while food also saw an increase. 31 May alone. The number of people May as families worried about the public realm.
Helen Dickinson, head of retail at
KPMG, said: Londons retail sales
bounced back in May as the weather
picked up and tourist numbers were
strong.
May 2009 was one of the weakest
months of last year, further boosting
the year-on-year comparisons. The
election campaign does not appear to
have dented spending patterns in the
capital but, as many London retailers
are already reliant on promotional
activity to drive footfall and sales, we
will have to wait and see if the forth-
coming budget will alter the current
trend of outperforming the UK.
Are you equipped
for a career in
financial services?
Enhance your career prospects
with ifs School of Finance
part-time professional
qualifications.
Professional Certificate in Banking
Foundation Degree/Professional Diploma in
Banking Practice and Management
BSc (Hons) in Banking Practice and Management
MSc in Banking Practice and Management

Visit our open house events to find out more

Open evening - Wednesday 16 June, 6.00pm-8.00pm
Drop-in sessions - Thursday 17 June and Friday 18 June, 9.00am-5.30pm

Please visit www.ifslearning.ac.uk/cityam to register.

The ifs School of Finance is incorporated by Royal Charter and is the only specialist financial education body with the power to award its own taught degrees.
 16 News
Dubai International Capital co-founder Sameer al Ansari
Dubai private
equity board
is dissolved
PRIVATE EQUITY
BY MARION DAKERS
PRIVATE equity group Dubai
International Capital (DIC) has con-
firmed its board was dissolved six
months ago, allowing parent compa-
ny Dubai Holdings to take over its
debts of around $2.6m (1.7bn).
The group released a statement yes-
terday following the news of non-
executive chairman and founder
Sameer Al Ansaris resignation.
DIC confirms that its board was
dissolved in January 2010 by its par-
ent company, Dubai Holding, in order
to implement a new governance
structure. DIC is currently under the
direct supervision of Dubai Holding,
it said.
Al Ansari, who helped set up the
group in 2004, moved to Dubai
investment bank Shuaa Capital in
January this year.
The group owns the
Travelodge hotel chain,
Alliance Medical and engineer-
ing firm Doncasters. Its debt-
fuelled investment scheme
at one stage managed
assets worth 8.5bn.
It has asked for a
three month
Picture: PA
extension on loans of $1.2bn (830m)
due later this month.
Dubai Holdings is owned by
Dubais ruler, Sheik Mohammed bin
Rashid Al Maktoum, and is thought
to have its own debt pile of more
than $12bn (8.3bn).
The group said its investment
and audit committees will
remain in place.
Urban Kings is a brand new state-of-the-art luxury mixed martial arts gym. In our astounding
designer surroundings you can finesse your physique or prepare for competition with our
specialized classes and equipment. You and a friend can experience the gym, or your choice
of class, for FREE. Call 020 7837 7774 or e-mail info@urbankingsgym.com. Terms and
conditions available on request.
Urban Kings, Bravingtons Walk, Regent Quarter, Kings Cross, London N1 9GA. urbankingsgym.com
Qatar set to become worlds
largest real estate investor
PROPERTY
QATAR will overtake sluggish
European funds to become the
largest real estate investor in the
world this year, according to a report
by property consultancy Jones Lang
LaSalle out yesterday.
The country has emerged as a glob-
al powerhouse in property, and will
become the top source of overseas
capital in 2010, says the report.
Cash-rich and with a strong
appetite for splashy overseas assets,
Managers could man the phones at BT
TELECOMS
BT plans to use hundreds of middle
managers to fill frontline positions in
call centres and engineering roles in
the event of a strike, sources say.
The telecoms group is put-
ting together contin-
gency plans for the
first strike
a t
Qatari vehicles have lately outshined
their counterparts from the region
and are projected to carry on with
their rapid expansion across the real
estate world the report said.
Qatar Holding, the investment arm
of the Qatari state, bought Harrods
last month for 1.5bn and owns a
large stake in Canary Wharf property
firm Songbird. The report predicts
high profile purchases across Latin
America, Eastern Europe and Asia.
The International Monetary Fund
expects the Qatari economy to
the firm since 1987, after talks with
the Communications Workers Union
(CWU) broke down last week.
The union rejected BTs final offer
of a 5.1 per cent pay rise over 21
months, arguing the deal treated
employees with contempt.
It has also been reported
that BT could go to
court in an
attempt
to block
a n y
strike
action.
CITYA.M. 14 JUNE 2010
expand by 18.5 per cent this year, on
the back of increased gas and oil
exports. It has enjoyed average eco-
nomic growth of 17.4 per cent over
the last five years.
Qatars prominence in the proper-
ty market is aided by a slowdown in
real estate activity from German
funds, which were among the largest
global investors in 2009.
Qatar is the epitome of energy-
rich Gulf nations, with a large
appetite for real estate, the report
said.
Around 55,000 CWU members will
be asked to vote by post on a possible
strike, with the CWU due to
announce the results on 5 July.
A spokesperson for the telecoms
group said: BT hopes that industrial
action can be avoided and that CWU
members see that a 5.1 per cent pay
rise, plus bonuses, over the next 21
months is a fair offer and higher than
many out there in the market.
BT said it was drawing up contin-
gency plans to ensure that services
are safeguarded but could not com-
ment on the details.
NEWS | IN BRIEF
Ministers ask for rail saving plan
Rail bosses could have the upper hand in
deciding their own spending fate as min-
isters have asked the UKs major train
companies to propose cost cutting ideas
when it comes to running the UKs rail-
ways. It is understood that the idea,
which could see the train companies
keep half their savings, is to provide
incentive amongst the rail industry to
agree to contract changes, which
are some of the most complicated
in the world and extremely
detailed. Further extreme measures
could be proposed in the future, it is
understood, such as returning to the
British Rail model when tracks and
trains were run by one company. It is
thought that Liverpools Merseyrail
could test out the scheme. However,
January passenger fares could go up
substantially as a result of the drive to
cut costs.
the art of
fighting
CITYA.M. 14 JUNE 2010 News 17

The threat of regulatory recession NEWS | IN BRIEF

as the main providers of credit.
Consequently, an increase in capital
requirements may produce a reduc-
tion in lending.
However, a more significant threat
is one the bankers in Vienna under-
standably didnt seem to want to talk
about. This is the issue of the quality
CNBC COMMENT of their businesses. As rising inter-
GUY JOHNSON bank lending rates indicate, finan-
cials in Europe increasingly no longer
trust one another.
That leads us to the conclusion
that the finance ministers have
realised that the situation is even
worse than the worst case scenario
that investors are talking about and
that bailing out the banks on such a
massive scale will be politically
impossible.
In this case its prudent for us to
assume that at some point in the not
to distant future Europe is going to
have another major banking crisis.
Greece or some kind of debt restruc-
turing by Athens. However, here
again Europes leaders say that they
have done all of they can. In the
words of the ECBs Jean-Claude
Trichet the scale of the political
response has been commensurate
with the size of the problem, even if
the market does not recognise this.
This means that all our political
leaders can now do is cross their fin-
gers. It seems as if all their arrows
Origo raises another $30m
Origo Partners, the private equity invest-
ment and consulting practice focused on
economic growth opportunities in China
and India, has raised $30m before com-
missions and expenses through a share
placing. The firm placed 82.2m new
shares with investors for 25p per share.
The stock is expected to be admitted for
trading on the London Stock Exchanges
junior Aim market from 17 June. Origo is
planning to use the proceeds to plough
into its existing war chest to seek oppor-
tunities to add to its significant portfolio
of investments in a range of sectors,

R
ISING regulation and economic
austerity could produce a toxic
mix in 2011. That was the view
of many of the bankers that I
spoke to last week at the
International Institute of Finance
spring meeting in Vienna. Crucially,
though, they were more concerned
about the prospect of a regulatory
recession than one induced by gov-
ernments taking the axe to spending.
RISKS FROM BASEL III
The Institutes chairman, Joseph
Ackerman, indicated that he thinks
that if Basel III is implemented in its
current form then GDP estimates will
need to be slashed and job queues
will be dramatically extended. Now
there could be some truth to this.
After all Europe does rely on its banks
The question is: what will be the have been fired and that the quiver is including metals and mining, agriculture,
DETAILED STRESS TEST RESULTS catalyst? The bankers could be right; now desperately empty. renewable energy and clean technology
The obvious antidote to this situation it could be the impact of regulation. Guy Johnson co-anchors European and technology, telecoms and media.
is the publishing of the results of However, this seems unlikely. The Closing Bell weekdays on CNBC. Liberum Capital acted as broker to the
detailed stress tests that are in the more obvious spark is the default of http://europe.cnbc.com placing.
final stages of being conducted by the
ECB.
The problem is that the regions
finance ministers, as the Austrian
finance minister made clear to me,
simply wont publish the findings at
an individual level. They are quite
happy to give us a general top down
picture but not a detailed bottom up
view.
The question has to be: what are
they afraid of? Surely by now they
must understand that if they are not
transparent the market will simply
assume the worst even if Moodys
says there is no problem.

3 0 T H J U N E / 1 S T J U LY 2 0 1 0
R O YA L H O R T I C U LT U R A L H A L L S , L O N D O N If youre an expat living
in the UK, take advantage
BAHRAIN K U WA I T OMAN Q ATA R SAUDI ARABIA UA E of our expat expertise
Everything you need to 57N Scotland

know about investing & doing If youre living as an expatriate in the UK, you may not
be aware of the opportunities that offshore banking can
business in the Gulf States provide. But the potential tax advantages that your status
QHHGTUECPDGUKIPKECPV
Put your trust in the hands of HSBC Bank International
and you will be dealing with people who really understand
what its like to be an expat. Because were experts
in expats, we can help you take advantage of the
opportunities your circumstances offer, with specialist
offshore products and services to help you make the
most of your savings and investments while youre living
in the UK.
Take advantage of our expat expertise:
Visit www.offshore.hsbc.com/am
Call +44 1534 616079

Free Exhibition Free Seminars

Free Networking
Supported by: Sponsored by:

Issued by HSBC Bank International, a trading name of HSBC Bank International Limited, HSBC House, Esplanade, St Helier, Jersey
JE1 1HS. HSBC Bank International is regulated by the Jersey Financial Services Commission for Banking, General Insurance
Mediation, Investment and Fund Services Businesses and licensed by the Guernsey Financial Services Commission for Banking,
Collective Investment Schemes and Investment Business. Licensed by the Isle of Man Financial Supervision Commission. Copies
Pre-Register for FREE entry at of the latest audited accounts are available on request. Approved for issue in the UK by HSBC Bank plc, 8 Canada Square, London
'*3&GRQUKVUCPFKPXGUVOGPVUOCFGYKVJPQP7-OGODGTUQHVJG*5$%ITQWRFQPQVDGPGVHTQOVJGRTQVGEVKQPRTQXKFGF
under the UK Financial Services and Markets Act 2000, including the Financial Services Compensation Scheme. To help us to

www.gccbritainexpo.com continually improve our service, and in the interest of security, we may monitor and/or record your communications with us.
HSBC Bank International Limited 2010. All Rights Reserved. MC8245AC18141/SJ/2206322
 18 Economic News CITYA.M. 14 JUNE 2010

SHOULD THE MPC BE WORRIED ABOUT THE

Inflation forecast to RISE IN INFLATION EXPECTATIONS? Interviews by Jessica Mead
MICHAEL SAUNDERS | CITIGROUP

stay stubbornly high Signs that high CPI and RPI figures are lifting
inflation expectations are bound to worry the MPC. The
MPC takes the inflation target seriously and it cannot
cent last month. The retail prices these forecasts would rise further. stand by if it loses credibility. So far, longer-term inflation

UK ECONOMY

BY JESSICA MEAD
INFLATION data out this week is likely
to cause a further headache for the
Bank of Englands Monetary Policy
Committee (MPC) after data on Friday
showed the publics expectations of
index (RPI) is only expected to moder-
ate slightly from its 19-year high of 5.3
per cent. Inflation has remained
above the three per cent upper thresh-
old for all of 2010.
The MPC has maintained that fac-
tors behind the spike, such as the
More concerning is the Bank of expectations remain fairly stable, combined with early fis-
Englands own quarterly survey of
inflation expectations, which cal tightening will keep the MPC on hold for now.
revealed on Friday that the public
expects inflation to be 3.3 per cent
this time next year compared with 2.5
per cent in the first quarter. This sug- ALAN CLARKE | BNP PARIBAS

long-term inflation had shot up
sharply.
The MPC has long argued it would
look through what it sees as a tempo-
rary spike in inflation. But, on aver-
age, economists forecast that annual
consumer price inflation will ease
slightly to a still-high 3.4 per cent after
depreciation in sterling and the VAT
hike in January, were only temporary.
But some economists are increasingly
disbelieving. Barclays Capitals Simon
Hayes said: Our expectation is that
inflation will continue to surprise the
MPC on the upside. If the government
were to announce a rise in VAT in the
gests that the Banks inflation-fight-
ing credibility is starting to wane.
But with an aggressive emergency Several members of the MPC have voiced con-
Budget scheduled for 22 June, the
Bank will face a tough choice over the cerns that the current elevated level of inflation could
next few months between sticking to
its inflation-fighting mandate and
threaten expectations and these concerns will have been
keeping policy loose to stave off a dou- validated to some extent by these data. It was an

hitting an 17-month high of 3.7 per emergency Budget, as many expect, ble-dip recession. uncomfortable reading but it is flashing amber rather
ANALYSIS l Surveys of Inflation Expectations Among the General Public, 2005-10 Source: Citigroup than a red alert at this stage.
5
%
4.5
4
SIMON HAYES | BARCLAYS CAPITAL

3.5
3
2.5 High headline rates of inflation need not be a
2 2.0% problem if they are understood to be temporary, and the
1.5 Target MPC has been at pains to highlight the temporary fac-
BoE/NOP Survey Of Inflation Expectations for Year Ahead (Quarterly)
1
YouGov/Citi Survey Of Inflation Expectations for Year Ahead (Monthly) tors at play. However, if high rates of inflation lead to a

0.5 YouGov/Citi Survey Of Inflation Expectations for Long Term (Monthly) rise in inflation expectations this may instill further per-
0
2005 2006 2007 2008 2009 2010 sistence into the inflation rate.
CITYA.M. 14 JUNE 2010 News 19

China takes Club Med stake GMC sniffs at gold mining

Chinese tourism market is estimated Fosun said a representative would
targets after Plus listing

LEISURE
to have grown by about 10 per cent a join Club Meds board and if its Club
BY HARRY BANKS year and Club Med is hoping to attract Med holding went beyond nine per
CHINAS largest non-state holding, 200,000 Chinese customers by 2015. cent, Fosun would appoint a second and precious metals sector, where it

Fosun, has acquired 7.1 per cent of hol-
iday resort group Club Med, the first
time a quoted Chinese group takes a
direct holding in a high-profile listed
French company.
Club Med hopes to make China its
second-biggest market in the next five
years while Fosun is keen to invest in
Club Med, whose all-in one resorts
appeal to well-heeled Chinese. The
Club Med said it aimed to open five
villages in China by then and would
inaugurate its first village this winter
in Yabuli, the largest ski resort in
north-east China. As part of the deal,
Fosun pledged not to lift its stake
beyond 10 per cent if it reached that
level, at least during the following 24
months, subject to no other sharehold-
er wanting more than 10 per cent.
representative. Fosun will not only
support Club Meds global strategy of
upscale positioning and sharing
Chinas growth opportunities but also
use this opportunity to benchmark
itself with international brands and
standards in order to improve its abili-
ty to consolidate resources and man-
age its investment said Fosun
chairman Guo Guangchang.
MINING
GOLD Mining Company (GMC), a ven-
ture set up to invest in the precious
metals sector, will today make its
debut on the Plus stock market, hav-
ing raised 820,000m in cash via a
placing of 37m new shares.
GMC said its listing would provide
the company with better opportuni-
ties for exposure to the robust gold
hopes to start making acquisitions in
the coming months.
It plans to target projects along all
stages of the development process,
from exploration to production.
Executive director Greg Kuenzel said
that gold would be the firms main
focus, though it will also consider
opportunities in other precious metals
such as silver, copper and platinum.

Supermarket
Tesco boss Sir Terry
Leahy last week
announced he will
be retiring from
the supermarket
after 14 years at

showdown as
the helm.

Picture: REX

rivals report
The group was hit by the news that

RETAIL
chief executive Sir Terry Leahy, who

Tesco is a better pick than Sainsburys

BY EMMA SADOWSKI
SUPERMARKET giants Tesco and J
Sainsbury are this week expected to
report fairly flat sales growth for the
first quarter of the year, signalling a
slowing of consumer activity across
the food sector.
Tesco is expected to report sales
growth of between zero and 1.5 per
cent tomorrow for the first quarter
according to analysts, which say the
groups international operations con-
tinue to see development in Asia but
are held back by Europe.
International could be a tale of
two halves as a cyclical recovery con-
tinues in Asia but is held back to
some extent in Europe by the Euro
debt crisis, said Execution Noble in a
research note sent to clients.
has led the group for more than a
decade, is set to retire next year. He
will be replaced by director and fel-
low Liverpudlian Philip Clarke.
Meanwhile, rival Sainsburys is
expected to report like-for-like sales
for the same period of between 0.5
and one per cent growth, including
VAT on Wednesday. It is thought that
excluding VAT, sales would have fall-
en by between 0.3 and 0.5 per cent.
Last week the groups annual
report revealed that chief executive
Justin King earned 8m in pay, pen-
sion top-ups and bonuses despite
Sainsburys reporting its slowest sales
growth in five years.
Supermarkets have been hit by the
removal of food inflation and the ris-
ing petrol prices.
THOSE looking for proof the UK is
going to bump along the bottom for
a while before making a convincing
exit from recession need only look at
this weeks supermarket sales fig-
ures. Now the comparatives are
beginning to get tougher, things are
looking decidedly lacklustre.
Analysts at RBS reckon J Sainsbury
will report flat UK like-for-like sales
excluding VAT. Arch rival Tesco will
also report a soft start to the year,
with RBS analysts pencilling in a 0.3
per cent increase in like-for-like sales
excluding VAT.
But thanks to Tescos increasingly
global focus, international sales
growth expected to be 14 per cent
in the first quarter will help cush-
ion the blow.
When it comes to Tesco, short-
term UK like-for-like sales trends are
increasingly unimportant. Its inter-
national expansion is continuing
apace, with 11m sq ft of new space
set to open this year. Of that, 8.5m sq
ft will be opened abroad, with 33 per
cent more space in Turkey, 27 per
cent in Malaysia, 46 per cent in
Japan, 28 per cent in China and 35
per cent in the US.
The challenge for Tesco is expand-
ing its distribution network to keep
up with this frenetic growth.
J Sainsbury has been more cautious,
barely expanding in North England
or Scotland let alone globally. It has
done well to target AB professionals
and cash in on the fresh food craze,
but this isnt enough when Tesco is
the competition.
BOTTOMLINE
Analysis by David Crow

CITY MOVES | WHOS SWITCHING JOBS Edited by Victoria Bates

Bupa
The healthcare provider has appointed Rita
Clifton to its board as a non-executive director,
effective from July.
Clifton is also a director at DSG International
and chairman of brand consultancy Interbrand.
She began her career in advertising at
DMB&B and J Walter Thompson, before joining
Saatchi and Saatchi in 1986, where she became
vice-chairman and executive planning director.
Execution Noble as an analyst covering the support serv-
The investment banking group has hired ices sector.
David Brockton to its UK mid cap team Brockton joins from Arbuthnot
Securities and has also worked at
Deutsche Bank and Investec. Prior to
taking a job in the City, he worked in
academic research at the University of
Exeter.
Norton Rose
The law firm has hired Michael Yu to its
Beijing office as a partner in the corpo-
rate team.
Yu has a wealth of corporate experi-
ence, having worked on a number of
M&A deals, IPOs, private placements
and restructurings. He joins from Global
Law Office, where he was a partner.
BestInvest
Peter Hall has now officially taken up
the reins as chief executive of the finan-
cial advisory firm, replacing John
Spiers, who founded the group in 1986.
Hall joined from UBS, where he has
been managing director of the wealth
management regional and investment
division for the past four years.
Hailsham Chambers
Bernard Livesey QC has joined the civil
and commercial chambers from Four
New Square, where he has been a ten-
ant for the past 18 years.
Livesey was called to the Bar in 1969
and took silk in 1990. He has experience
in commercial litigation, construction
and insurance, and specialises particu-
larly in the professional liability of
lawyers, accountants and valuers. He is
also a deputy High Court judge in the
Chancery and Queens Bench divisions.
IPA
The Insolvency Practitioners Association
appointed Carl Faulds as its new presi-
dent at its annual meeting last week.
Faulds is currently managing director
of Portland Business Recovery.

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

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

headline sponsor

in association with
CITYA.M. 14 JUNE 2010 WORDS BY ROGER BAIRD Interview 21

Centrica looks
investment environment for long-
term investors.
The task facing the UK energy
industry is nevertheless daunting. It
will have to find 200bn over the next
decade to upgrade its nuclear, wind,

hard at its
gas and clean coal power stations
and make sure 15 per cent of all of this
energy comes from renewables as EU
guidelines specify.
Centrica itself plans to spend 15bn
over this period. Luff is confident the

nuclear option
business can find this cash, pointing
out the firm produces 1.5bn of cash-
flow every year (he does not rule out a
cash call if extra investment is need-
ed). The last time the company went to
its investors was in 2008, when it
raised 2.1bn to buy British Energy
and North Sea gas producer Venture
The firm will spend the billions it earns from UK Production for 1.3bn.
Last month the business put out a
households on atomic, green and US expansion strong trading statement: it added
200,000 new customers, so it now
serves 15.9m residential consumers.
Analysts expect its 2010 full-year oper-

C
ENTRICAS finance director
Nick Luff is busy trying to work
out if the new coalition energy
secretary Chris Huhne is a man
the countrys largest gas and electrici-
ty supplier can do business with.
Huhne a Liberal Democrat had
previously described nuclear power as
a failed technology. But that was
before he scented the beautful aroma
of power: now firmly ensconced in the
cabinet, Huhne last month said that
he now backed the governments poli-
cy of building 10 new nuclear power
stations over the next 20 years, as long
as no public subsidy is used.
This matters to Centrica, which
runs British Gas, because it owns a 20
per cent stake in British Energy
(which it bought for 12.5bn two years
ago along with French rival EDF). The
two firms propose to erect two French-
designed enhanced pressurised reac-
tors at Hinckley Point and then two
more at Sizewell at around 4bn each,
with the first one ready by 2017 at the
earliest.
After Huhnes u-turn Luff, 42,
thinks he can work with the Lib Dem
politician even if he recognises that
he will not have an enthusiastic sup-
porter of nuclear power at the heart of
government. He says: Everyone will
have to think about the countrys
security of supply in the future. It is
pretty obvious that nuclear has got to
be part of that. The government as a
whole has been supportive.
However, Luff _ wiry and thought-
ful man is impressed with the speed
with which the coalition has moved
on this issue. Sitting in Centricas
London offices just behind Savile Row
in the West End, he says: I am delight-
Luff is impressed by the speed at which the coalition has given its view on nuclear policy
ed about that. A nuclear building pro-
gramme could have fallen by the way-
side, given the problems the budget
deficit. But instead they have given us
their view early on.
However, Huhne may have set an
unrealistically high bar for nuclear
builders by saying no public subsidy
must be used to build them. This has
not happened anywhere in the world
for many years. Nevertheless, Luff
thinks it will be possible to raise all
the cash in the private sector, even in
this fragile post financial crisis envi-
ronment.
He says Centrica was able to finance
the 400m Lynn and Inner Dowsing
wind farm project (located off the
Lincolnshire coast) that started in
2008 and spanned the financial crisis.
And Luff is confident he and EDF can
raise ten times that amount for
nuclear expansion.
He says: The appetite is there. But
strong companies like us have to raise
it, and government has to set a stable
ating profit to hit 2.1bn, compared to
1.9bn last year.
Luff is also keen to provide cash for
the business to grow in North
America, where it trades as Direct
Energy. The firm operates three power
stations in Texas, and a couple of gas
fields in Alberta, Canada. And just last
week it bought Florida-based energy
services firm Clockwork Home
Services for $183m (125m) in cash to
further boost its position in the US
market.
Luff says Centrica is looking at
investment options in gas storage, gas
exploration, wind power, in the US as
well as nuclear development. He is
keen to stress the firm does not have
all its eggs in one atomic basket
undoubtedly a prudent move, regard-
less of the coalitions current thinking
on the subject.

Free Seminar
on investing
in South Africa
Join FT columnist David Stevenson for a
comprehensive review of both the short and longer
term opportunities in South Africa and the wider
emerging markets. Rafaelle Lennox from RBS
will also explore how to take advantage of these
opportunities with RBS Listed Products.

Date: 16 June
Time: 5.30pm - 7.00pm
Location: 250 Bishopsgate, London

To register for this event, email

us at markets.uk@rbs.com or
visit www.rbs.co.uk/markets

The Royal Bank of Scotland plc (RBS) does not endorse any of the reports and other written materials provided by David Stevenson (the Materials) or any statements made by David Stevenson or Investors Intelligence (the Statements). RBS makes no warranty or representation
whatsoever, express or implied, as to the contents of the Materials or Statements. RBS shall not be liable (whether in negligence or otherwise) to any person for any error in the Materials or Statements and RBS shall not be under any obligation to advise any person of any error
therein. The views expressed in the Materials or Statements represent the opinions of David Stevenson and not RBS. By attending an event, you acknowledge and agree that RBS does not review or endorse and shall not be liable directly or indirectly, for the content of such
Materials or Statements or the use that others make of these Materials or Statements, nor for any damage, loss or offence caused or alleged to be caused by, or in connection with, the use of or reliance on any such Materials or Statements at such event. The Royal Bank of Scotland
plc, Registered in Scotland No 90312. Registered Office: 36 St Andrew Square, Edinburgh EH2 2YB. RBS is authorised and regulated in the UK by the Financial Services Authority. RBS is an authorised agent of The Royal Bank of Scotland N.V. in certain jurisdictions.
22 News
Tax is a matter for UK government, not the EU
line the governments plans for
reform within the banking sector.
One of the most significant propos-
als I have no doubt the Chancellor
will touch upon is his determination
to introduce a bank tax in the UK,
despite the G20s failure to produce a
consensus on this issue. The prospect
CITY COMMENT of a globally administered bank tax is
not only undesirable but to expect
STUART FRASER the G20 to produce a specific propos-
al was unrealistic. Member states
T
HIS week, in a speech to leading such as Canada, China, India and
figures from across the financial Brazil did not have to bail out their
services industry at Mansion banks and thus, understandably, see
House, George Osborne will out- no reason why they ought to intro-
duce such a levy, at least one to create
some kind of insurance fund.
However, there remains a good deal
of support for a bank tax among many
of our key international partners who
are facing similar economic and polit-
ical challenges to the UK. This is per-
haps the only method of raising tax
from banks as the huge losses accumu-
lated over the past two years are, in
many cases, tax deductable which
means some wont pay corporation
tax for a long time. Osborne knows
this and, whilst he may have picked up
political points by publicly declaring
the government will introduce a levy
regardless of whether other countries
will or will not, he will be aware
theres little chance of the UK being
left isolated. Whilst the prospect of a
globally administered bank tax has
receded, both EU internal markets
commissioner Michel Barnier and
European Council President Herman
van Rompuy this week reaffirmed
their determination to implement a
bank tax by 2011, to be used to create
some form of EU insurance fund.
Closer European cooperation and
integration is entirely appropriate in
many areas it is very much in our
interests to maximise the business
CITYA.M. 14 JUNE 2010
benefits of being a part of a growing
economic bloc with a single market in
financial services. Certainly for the UK
those costs are rising, particularly
from the imposition of a multitude of
new regulations and extra layers of
surveillance and box ticking. Is the UK
going to accept a Brussels imposed tax
to add to the growing burden? I hope
not. What form a UK bank tax will
take and what the proceeds will be
used for remains unclear but one
thing is certain; this is a matter for our
own national government to decide.
Stuart Fraser is the Policy Chairman at
the City of London Corporation.

    

  
   
   
  

South Korea unveils
  
       currency controls
 ) ! "%! '%!&#"%' &"('"!& ! WORLD ECONOMY rency and cooling overseas borrow- equity capital. The cap for foreign
 ', " "!"! "% ")%  & ! '
BY HARRY BANKS
%' #% ! "(% &'%"! ! " '' ' SOUTH Korea yesterday unveiled
long-anticipated currency controls,
ing. The restrictions slap limits on bank branches was set at 250 per
banks and other financial institu-
tions currency forwards, cross-cur-
cent of equity to account for lower
capital, which on average is just 1/30
rency swaps as well as of that held by domestic banks.
"  ! "! (& "!
saying it aimed to curb the rapid
shifts in capital flows linked to
   short-term foreign debt and posed a
% #%"" ,"(% % "!!
risk to the worlds ninth-biggest
exporter.
***'&%&"!!"( The authorities, alarmed by the
wons sharp swings during recent
market turbulence caused by
non-deliverable currency forwards.
These measures are aimed at
reducing the volatility in capital
flows that poses a systemic risk in
the country, South Koreas finance
ministry, two financial regulators
and the central bank said.
The new rules will cap domestic
Officials brushed off suggestions
the regulations, which follow liquid-
ity controls and curbs on compa-
nies currency trades announced in
November, could hurt investor con-
fidence. We will stick to a principle
of an open market and liberalisa-
tion of capital transactions. That is a
'% ' &  "%#"%'
#%' !' "%  %&"! "(!' "(% Europes debt problems, have been banks and non-bank financial insti- promise we have globally made,
priming investors for weeks for tutions currency forwards and said deputy finance minister Yim
+(') *  ##, '" &!  # '" &(' ,"(% !& action aimed at stabilising its cur- derivatives at 50 per cent of their Jong-yong.

&"(!' "! ,"(% %&' "(%!, (&' $("' -', .

 "% %' %& #'

BEST OF THE BROKERS
ANALYSIS l Michelin ANALYSIS l Greene King ANALYSIS l Ferrovial
60 58.59 480 p 8
11 Jun 390.30 5.63
58 460 11 Jun 11 Jun
56 7
440

54 420
6
52 400

50 380

48 360 5
15 Mar 6 Apr 26 Apr 14 May 3 Jun 15 Mar 6 Apr 26 Apr 17 May 7 Jun 15 Mar 2 Apr 22 Apr 12 May 1 Jun

MICHELIN GREENE KING FERROVIAL

Royal Bank of Scotland (RBS) initiates a
buy rating for Michelin and says that
despite rising material prices, it sees
room for Michelin to profit from early
implementation of price increases,
stronger replacement business momen-
tum, and better underlying earnings due
to the cost cuts in 2009.
Seymour Pierce has given Greene King a Citigroup gives BAA owner Ferrovial a
buy recommendation after the group buy rating. Citi said that Heathrow
acquired four pub restaurants from recorded a 3.1 per cent year on year
Punch Taverns for 5.3m. According to decrease in May due to the Icelandic
Seymour Pierce, Greene King advises volcanic ash cloud disruption and by the
that the underlying trading levels of BAs cabin crew strike. If adjusted for
these units will improve post acquisition, these disruptions, BAA estimates 2.8
and is confident the group will succeed. per cent traffic growth at Heathrow.

To appear in Best of the Brokers email your research to notes@cityam.com

CITYA.M. 14 JUNE 2010
Companies in
pensions cull
as crisis bites
PENSIONS
BY JOHN DUNNE
MORE than nine out of ten employers
are planning to scrap or scale back
their defined benefit pension
schemes, a survey has revealed.
As companies fight for survival fol-
lowing the global economic crisis
pensions are being sacrificed.
In the poll of 179 major employers,
including 34 with more than 10,000
employees, and 38 of the FTSE 100
only six per cent said they would
retain defined benefits pension
schemes in their current form.
The number of companies that
have shut defined benefit schemes to
existing employees has more than
doubled since last year from 14 per
cent to 32 per cent, according to the
research by business advisers
PricewaterhouseCoopers.
Meanwhile a further 30 per cent of
employers intend to close defined
benefit schemes to existing staff
The survey also showed that 87 per
cent of employers believe that
News 23
Bosses taking a
tougher line on
late workers
ECONOMY
EMPLOYERS are taking a tougher line
with staff because of the recession,
with one in six prepared to sack some-
body for being late just two or three
times, a new survey has revealed.
Twelve per cent of business leaders
employees are not saving enough for in the UK said they would show the
retirement while 60 per cent think door to a worker who was late four or
that their employees will not be able five times with 39 per cent reporting
to retire when they wish due to insuf- they are now paying more attention
ficient savings. to what time workers arrive than they
Marc Hommel, pensions partner at had before the downturn.
PricewaterhouseCoopers said: The study, on behalf of online jobs
Employers are sounding a repetitive site CareerBuilder.co.uk, included
death knell for defined benefit pen- more than 100 UK business leaders.
sions. The size and volatility of fund- While employers would prefer
ing costs, and also concerns about the workers to clock in at their designat-
inequality of pensions provision with- ed start time, many said they were
in an employers workforce, are accel- willing to give workers with some
erating their demise. flexibility.
Companies recognise the value to Forty-six per cent of UK employers
their businesses and people of provid- said they didnt care if their employ-
ing workplace pensions but not at the ees are running late as long as their
risk of jeopardising the business as a work is completed on time with good
whole. quality. However, some reported that
they had been given lame excuses
FAST FACTS | PENSION SURVEY including one who claimed their cat
had got caught in its flap.
Only six per cent of companies polled said Tony Roy, managing director for
they would retain their defined pension CareerBuilder UK, said: Getting
schemes in their current form. organised and preparing for the
87 per cent of employers do not think their upcoming day the night before can
staff are saving enough for their retirement. help to improve punctuality and
Marc Hommel, pensions partner at PricewaterhouseCoopers make the commute less hectic.
 Investment
24
Be discerning
about Europes
banking sector
There are some bargains to be had, but do
the analysis rst, writes Kathleen Brooks
T
HE last two years have been cata-
clysmic for the global banking sec-
tor. Yet most banks managed to stay
afloat during the financial crisis
and have returned to profitability this
year. And after the wave of volatility that
hit the markets in recent weeks, banking
stocks are beginning to look cheap.
But should investors be buying up banks
with low price-to-earnings (PE) ratios in an
attempt to bag a bargain? Most analysts
would say no. Although the financial sec-
tor is in better shape now than in
September 2008, more stringent regula-
tion and higher levels of taxation are the
newest clouds gathering on the horizon.
Yet one can make money in the sector
and spread betters need to have a discern-
ing eye when it comes to trading the
banks. Analysts at UBS favour banks based
in economies that largely dealt with the
financial crisis during 2008-2009 for
example the UK and the US and it has a
buy recommendation on Lloyds Banking
Group, HSBC and Barclays. Compared to
the US and the UK, European banks are
still reliant on the Europeam Central Bank
(ECB) for funding. Whereas US banks
usage of the Federal Reserve to borrow
funds has shrunk from $700bn at the peak
of the crisis to less than $100bn earlier this
year, the ECB has had to ramp up their
lending to banks within the Eurozone; in
May it lent $800bn, close to what it was
lending in October 2008 when Lehman
Brothers failed.
The question now is how well Europes
banks would perform if the ECB was to
remove its funding, thereby forcing banks
to raise cash in the private markets.
LET US GIVE
YOU A BOOST...
When you open a CFD, spread bet or forex account with GFT.
*Terms and conditions apply. See website for details. CFDs, spot forex and spread bets are
leveraged products and may not be suitable for everyone as it is possible to lose more
than the funds you deposit. Please ensure that you fully understand the risks involved. GFT
Global Markets UK Ltd. is authorised and regulated by the Financial Services Authority.
CFDs | SPREAD BETS | FOREX / gftuk.com / free phone 0800 358 0864
CD03UK.099.052010
CITYA.M. 14 JUNE 2010
| Spread Betting
Another reason for the ECBs lending,
according to UBS analysts, is that
European banks have not raised enough
equity to absorb the losses experienced
during the recession. Since the regulators
are likely to ramp up capital demands for
the banks, investors should look for those
banks with the best capital ratios.
Analysis by S&P Equity Research has
found that strong profits in the first quar-
ter of this year provided a boost to Swiss
banks Credit Suisses and UBSs Tier One
capital ratios, which is the key measure of
a banks financial health. For example,
UBSs core Tier One capital ratio rose from
15.4 per cent in the fourth quarter of 2009 Differentiating French investment bank, is also an attrac- The readjustment in the European
to 16 per cent in the first quarter of 2010. between Europes tive buy because of its diversified business banking sector is far from complete, but
However, according to S&P Equity banks is key model, which includes an international for investors with a medium-term time
Research, Deutsche Bank actually saw its retail bank. Also, at current prices, Societe horizon now is a good time to get in early
core Tier 1 Capital ratio fall to 7.9 per cent Picture: GETTY Generale looks good value and has a PE and gain exposure to the best positioned
in the first quarter of 2010, from 8.7 per ratio of just over 10. European banks.
cent in the last quarter of 2009, due to its
acquisition of wealth manager Sal
Oppenheim, as well as a change in regula-
IN FOCUS | SANTANDER
tory reporting standards. But S&P Equity
Research notes that even without the When Standard and Poors, the ratings Spain in late May. Bank of America in 2003 for $2.5bn.
acquisition, Deutsches capital ratio would
still have seen a slight decrease. This sug- agency, first downgraded Spanish debt Its Madrid-listed shares recovered to S&P Equity Research reiterated its
gests there will be increasing pressure on in April, many analysts expected Banco close on Friday at 8.73, after its chair- strong buy rating last week on the back
the bank to improve its capital base. Santander to sail through the turbu- man Emilio Botin said that profit this of the deal. Investors have been skittish
Instead, S&P Equity Analysts have a
strong buy recommendation for Banco lence. At the time, analysts at both S&P year would be similar to that of 2009 but the banks bottom line is relatively
Santander (see In Focus box). It argues that Equity Research and RBS recommended the group reported pre-tax profits of insulated from Spanish troubles only
Satander is particularly cost efficient and buying the stock. Santander, which 13.48bn last year. In its first-quarter, 25 per cent of its operating profit comes
has a low cost-to-income ratio compared to
other European banks. It is also attracted
owns Abbey, Bradford & Bingley and net income jumped 5.7 per cent to from Spain. Since the start of 2010, its
to its favourable geographic mix: Latin Alliance & Leicester saw its share 2.21bn. It also announced last week price-to-earnings ratio has fallen to 7.65
America has overtaken continental Europe price fall sharply as the bad news con- that it planned to buy back a large stake times from 11.31 times.
as the groups main revenue provider. tinued with another downgrade for of its business in Mexico, which it sold to Juliet Samuel
UBS argues that Societe Generale, the
CITYA.M. 14 JUNE 2010
SPREAD BET
GURU
JOSHUA
RAYMOND
MARKET
STRATEGIST
josh@cityindex.com
Q.
Dear Josh, what are the markets
expected to be like during the
World Cup?
A.
If you were thinking that traders are
likely to be keeping a close eye on
the World Cup and that this could
affect volumes, then you are right.
Historically, the financial markets have tend-
ed to be particularly quiet during any major
sporting event.
With the sovereign debt crisis still having
a strong and volatile influence on the finan-
cial markets, this could deter even more Traders may be taking
traders this summer. But this could be dan- their eyes off the ball
gerous low volumes can make the markets
even more volatile. So, if you are spread bet-
ting during this period you will need to think
about risk management.
That said, this World Cup could be slightly
different since it is taking place at a time
when the markets have already sold off quite
aggressively. The FTSE 100 lost as much as
14 per cent from its April high to last weeks
low and the Spanish Ibex has lost 26 per
cent. This could well keep traders interested,
particularly if they feel that there are bar-
gains to be had.
And lets not forget the emergency Budget
due out next week which will grab the atten-
tion of the market.
Q.
Dear Josh, BPs shares are very
volatile. How can I protect myself
if I am trading the stock?
A.
BPs shares fell to a new 13-year low
last week, and by as much as 49 per
cent since its April high, which is an
aggressive loss. The best way to manage
your risk in spread betting is to use a guar-
anteed stop loss. A stop loss is an order to
close an existing trade at a specific level in
THE WORLD CUP
TIPSTER
FIERY DUTCH TAKE
ON THE DANES
I
T WAS an exciting start to the 2010 World Cup with
a tight game between hosts South Africa and Mexico
ending in a draw, and an equally tight game between
England and the USA. But football traders will be
focused on the next games on the schedule.
Today sees the Netherlands take on Denmark in
Group E and there are plenty of opportunities for some
canny spread bets ahead of the game at 12.30pm.
Holland is typically a strong team but its footballing
history has been littered with stories of unfufilled
potential. However, those expecting more from the
Dutch in 2010 should take a look at extrabets
Netherlands 100 index, currently trading at 32-35.
Teams that get knocked out in the semi-finals get 50
points, runners-up receive 75 and the winners get a full
100.
The Dutch have been involved in some fiery games in
the past but under head coach Bert van Marwijk they
have been well-disciplined. In their eight qualifiers they
only exceeded two bookings in one match and had no
cards at all in four of the games. It will depend on the
referee, but a sell of Sporting Indexs Netherlands team
bookings for the match at 17 looks decent value. (Its 10
points for a yellow and 25 for a red.)
Robin van Persie had a frustrating season with
Arsenal due to injury but he is a top quality striker on
his day and has scored four goals in Hollands last three
warm-up games. The Group E favourites will be hoping
THE WILD SIDE 25
OF MALAYSIA
SEE TRAVEL ON
PAGE 28-29
THE TIPSTER
SUPERMARKETS IN FOCUS THIS WEEK
AHEAD OF FIRST-QUARTER SALES
F
OOTBALL results might be capturing dence than its rivals. Cantor Index is offer-
everybodys attention at the moment ing 398.64p 400.11p.
but there are some key financial scores One retailer that ought to benefit from
out this week. Following positive full- the World Cup is Sports Direct. England is
year results in March, grocer J Sainsbury is expecting plenty from its national team and
expected to announce first quarter profits the further the team go in the tournament,
this week. Will its management confirm the more shirts and balls Sports Direct are
Morrisons news that a slowdown in the mar- likely to sell. Capital Spreads quotes 94.3p-
ket has begun? With the firms recent 95.2p.
increased expansion investment, combined Property company Land Securities has
with a wavering consumer, a weak statement just bounced off its top side resistance and
from the supermarket chain would not be sur- with fears about tax implications emanating
prising. Cantor Index offers a spread of from the emergency Budget later this
328.28p-324.54p. month, traders should be looking for a
Last week saw Sir Terry Leahy announce retracement to 550p lows. WorldSpreads is
his departure from rival supermarket chain offering 609.75p -610.75p.
Tesco. Analysts are expecting him to go out The rise of the mobile computing move-
with an optimistic outlook for the company. ment should benefit companies such as
The expansion of overseas business, ARM Holdings. While Intel and nVidia
including the announcement they will be dominate the PC markets, these industry
the market determined by you. But a guaran- opening 80 new centres in China, has seen bellwethers still trail their smaller counter-
teed stop loss means that, regardless of Tesco become an international household parts in performance and energy efficiency
moves in the underlying price, your order will name. This should mean that its earnings on mobile platforms. Spreadex quotes
Picture: be closed out at the level requested, even if are less affected by UK consumer confi- 288.30p-290.20p.
REUTERS the market gaps. But be aware that guaran-
teed orders do carry a small extra charge.
Q. Futures Symposium 2010
Dear Josh, what economic data is
there to keep an eye out for this
week?
A.
Lots, is the answer. Today we have
some EU industrial production fig-
ures, economic forecasts from the
25-26 JUNE 2010
UK Office for Budget Responsibility and the
Bank of Englands Quarterly Bulletin. Cavendish Conference Centre West End
Tomorrow, traders will be keeping an eye out 22 Duchess Mews, London, England W1G 9DT
for UK inflation data, German economic sen-
timent and the US Empire manufacturing Join TradeStation for a special two-day futures trading
survey.
We also have UK unemployment and US symposium. This is a unique opportunity to learn about futures
industrial production due out on Wednesday, trading and analysis from
m industry and TradeStation
r e
experts in a
while the monthly report from the European live real-time environment.
Central Bank, UK retail sales, US inflation,
Philly Fed and UK public finances are all like-
ly to keep everybody interested as the week F
Featured
ea tur ed Sp
Speakers
eakers
draws to a close.
If the World Cup hasnt swayed your
focus, that is. ST
TANLEY
A DASH NICK McDONALD
V..P
P. of Applied Technical
e Afternoon Trading
r Strategies
Strat for
Index Fu
utures
Analysis, TradeStation
r Secu
Securities
Introduction to Futures Trading
radin
r
JOHN PERSON
JOHN CARTER and HUBERT Gaining an Edge in the Futures
SENTERS
Live Trading
r and Analysis That
Tha
Market Using Seasonal Studies
Works MICHAEL BURKE
Picture: ACTION IMAGES
V..P
P. of Institutional Training,
MIKE BAGHDADY TradeStation Securities
Practical Applications of Price Building Effective Trading
radin
r
Behavior in Rule-Based Trading
radi
r Strategies with Improveded Technical
e
Indicator Visualization
Register today online at T
TradeStation.com/CityAM
radeStation.com/City
r AM
Coach Bert van Marwijk has calmed down the Dutch
Call toll-free 00800 777 76543 to get all the details
to go all the way this year and van Persie will be vital to about this valuable two-day TradeStation
r eve
event.
their chances. Sporting Index is offering a spread of 23-
26 on the total number of goal minutes for van Persie.
Group F kicks off at 7.30pm this evening with Italy
and Paraguay battling it out. However, a high-scoring
game is unlikely defence is often the best form of
attack for the Italians and Paraguay havent scored
TradeStation Securities
Member NYSE, FINRA, NFA and SIPC
more than two goals in a game in their last 10 starts. These are educational workshops designed to demonstrate what we believe are the valuable benefits of
Selling extrabets total match goals at 2.1-2.3 might well using TradeStation. No offer or solicitation to buy or sell securities, securities derivatives, or futures products
be a savvy trade. of any kind, or investment or trading advice, recommendation or strategy regarding any security, group of
Tomorrow, favourites Brazil make their debut against securities, market segment or market, is intended, shall be given, or in any manner endorsed by TradeStation
Securities, Inc. or any of its affiliates. Past per formance, whether actual or indicated by simulated historical
North Korea. While the Samba Boys might be happy tests, is no guarantee of future per formance or success. Trading on margin increases risk by magnifying the
with a 2-0 win, they could try to send a message to the extent of potential losses. If you are unsure as to whether or not a par ticular investment is appropriate for
rest of the competition and go to town. Traders could you, you should seek independent advice. Visit www.tradestation.co.uk for additional risk disclosures.
buy Brazil supremacy a prediction on the winning This material has been issued by TradeStation Securities, Inc. and approved by TradeStation Europe Limited
margin, in goals, of one team versus another at 2.7 (an introducing broker to TradeStation Securities, TradeStation Group Inc.s main operating subsidiar y)
with Sporting Index. as defined in Section 21 of the Financial Ser vices and Markets Act 2000. TradeStation Europe Limited is
Jessica Mead authorized and regulated by the Financial Ser vices Authority (FSA A)
and has passpor ts under the MiFID
Directive 2004/39/EC in all countries in the EEA (except for Romania).
 26 Markets & Investments CITYA.M. 14 JUNE 2010

LONDONS TOP 250 Trade these shares from 1.50 with Interactive Investor - www.iii.co.uk
Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low
(p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p)
3i . . . . . . . . . . . . . . . . . . . . . . . .287.90 0.60 314.80 216.75 Compass . . . . . . . . . . . . . . . . . .563.00 3.50 572.00 307.75 Jardine Lloyd Thompson. . . . . . .558.50 1.00 604.50 393.00 Sainsbury(J) . . . . . . . . . . . . . . . .321.40* 1.70 373.00 306.50
3i Infrastructure . . . . . . . . . . . . .108.60* +0.90 114.40 87.50 Cookson . . . . . . . . . . . . . . . . . . .439.40 +5.40 616.00 220.00 Johnson Matthey . . . . . . . . . . .1508.00* 11.00 1814.00 1077.00 Schroders . . . . . . . . . . . . . . . . .1327.00 +4.00 1450.00 764.00
A.B. Foods . . . . . . . . . . . . . . . . .994.50* +2.00 1045.00 718.50 Croda Intl . . . . . . . . . . . . . . . . .1035.00 +3.00 1047.00 498.50 JPMorgan Emerg Mkts . . . . . . . .506.50 +1.50 549.00 350.50 Schroders N/V. . . . . . . . . . . . . .1060.00 +6.00 1185.00 643.50
Aberdeen Asset Man . . . . . . . . . .136.40* 155.60 111.00 CSR . . . . . . . . . . . . . . . . . . . . . .405.80 +6.30 524.00 320.75 Kazakhmys . . . . . . . . . . . . . . . . 1134.00 10.00 1634.00 567.50 Scot. & Sthrn Energy. . . . . . . . . 1106.00 1206.00 357.50
Admiral. . . . . . . . . . . . . . . . . . .1372.00 +6.00 1403.00 833.50 Daily Mail A . . . . . . . . . . . . . . . .473.00* +1.40 539.00 264.25 Kesa Electricals . . . . . . . . . . . . .108.30 +3.20 162.00 98.45 Scottish Mortgage. . . . . . . . . . . .566.00* +5.50 623.50 376.00
Aegis . . . . . . . . . . . . . . . . . . . . .109.50* +0.20 137.30 79.75 Dana Petroleum . . . . . . . . . . . .1088.00 +44.00 1549.00 968.50 .LQJVKHU . . . . . . . . . . . . . . . . . .222.40* +0.60 255.00 171.40
Afren . . . . . . . . . . . . . . . . . . . . . .87.00 2.80 111.00 38.50 Davis Service . . . . . . . . . . . . . . .371.90 5.60 442.30 307.00 Ladbrokes . . . . . . . . . . . . . . . . .137.30 +0.50 174.29 114.60 SEGRO . . . . . . . . . . . . . . . . . . . .272.10 +4.20 403.10 250.00
Aggreko . . . . . . . . . . . . . . . . . .1415.00 58.00 1489.00 476.25 De La Rue . . . . . . . . . . . . . . . . . .970.00 14.00 1021.00 808.50 Lancashire Hldgs . . . . . . . . . . . .492.50 +9.50 540.00 416.70 Serco . . . . . . . . . . . . . . . . . . . . .628.00 1.00 656.50 394.30
Alliance Trust . . . . . . . . . . . . . . .317.70 +2.60 352.70 260.25 Debenhams . . . . . . . . . . . . . . . . .58.60 +0.80 91.95 53.75 Land Securities . . . . . . . . . . . . . . 611.50 743.50 415.25 Severn Trent . . . . . . . . . . . . . . .1246.00 +3.00 1258.00 921.00
AMEC . . . . . . . . . . . . . . . . . . . . .821.50* 891.00 603.50 Derwent London . . . . . . . . . . . .1306.00* 17.00 1490.00 844.00 Legal & General . . . . . . . . . . . . . .81.05 +1.00 94.40 49.37 Shaftesbury . . . . . . . . . . . . . . . .357.50* 2.10 426.50 284.00
Amlin . . . . . . . . . . . . . . . . . . . . .378.90 +9.30 428.50 291.00 Dexion Absolute . . . . . . . . . . . . .139.00 +2.00 148.00 107.75 Lloyds Banking Gp . . . . . . . . . . . .54.33 1.58 75.58 40.42 Shire. . . . . . . . . . . . . . . . . . . . .1430.00 +1.00 1526.00 798.50
Anglo American . . . . . . . . . . . .2576.50 45.00 3015.50 1540.00 Diageo . . . . . . . . . . . . . . . . . . . 1104.00 +2.00 1176.00 831.50 Logica . . . . . . . . . . . . . . . . . . . .122.90 0.10 149.10 71.50 SIG . . . . . . . . . . . . . . . . . . . . . . .109.10 +0.10 146.60 82.25
Antofagasta . . . . . . . . . . . . . . . .856.50* 15.50 1100.00 546.50 Dimension Data . . . . . . . . . . . . . .98.25 +0.10 105.00 53.75 London Stock Exchange . . . . . . .618.50 +18.00 949.50 588.00 Smith & Nephew . . . . . . . . . . . . .639.00 2.50 700.50 435.25
Aquarius Platinum . . . . . . . . . . .355.00 6.70 490.00 172.75 Dominos Pizza . . . . . . . . . . . . . .376.10 +11.10 379.90 192.75 Lonmin . . . . . . . . . . . . . . . . . . .1578.00 24.00 2198.00 950.00 Smiths . . . . . . . . . . . . . . . . . . .1067.00 6.00 1177.00 649.00
ARM Holdings . . . . . . . . . . . . . . .289.40 0.70 362.40 104.00 Drax . . . . . . . . . . . . . . . . . . . . . .367.90 +12.30 496.50 321.50 Man . . . . . . . . . . . . . . . . . . . . . .246.40 +3.60 373.60 199.60 SOCO Intl . . . . . . . . . . . . . . . . . .416.00 +17.90 419.00 380.60
Arriva . . . . . . . . . . . . . . . . . . . . .766.50 782.50 378.50 DSG Intl . . . . . . . . . . . . . . . . . . . .27.00 +1.48 39.75 19.25 Marks & Spencer. . . . . . . . . . . . .340.90* 2.10 412.70 281.50 Spectris . . . . . . . . . . . . . . . . . . .810.00* 8.00 928.00 493.50
Ashmore . . . . . . . . . . . . . . . . . . .248.50 +0.70 311.20 183.25 Dunelm . . . . . . . . . . . . . . . . . . . .348.30 1.60 438.40 202.00 Marstons . . . . . . . . . . . . . . . . . . .96.30* +0.65 119.67 77.50 Spirax-Sarco Eng . . . . . . . . . . .1394.00 4.00 1591.00 749.50
Ashtead . . . . . . . . . . . . . . . . . . .108.90 3.80 128.50 52.00 Easyjet . . . . . . . . . . . . . . . . . . . .418.00 +3.90 499.90 260.00 Meggitt . . . . . . . . . . . . . . . . . . . .313.10 6.20 328.70 151.75
Astrazeneca . . . . . . . . . . . . . . .3056.00 +67.00 3136.00 2487.00 Edinburgh Inv Tst . . . . . . . . . . . .397.90 +3.10 412.40 297.50 Melrose . . . . . . . . . . . . . . . . . . .212.40 +0.50 251.50 87.75 Spirent Comms . . . . . . . . . . . . . .109.30 +1.30 127.80 54.50
Atkins(Ws) . . . . . . . . . . . . . . . . .715.00 +4.50 730.00 513.50 Electrocomponents . . . . . . . . . . .217.20 +0.50 245.00 134.25 Mercantile IT . . . . . . . . . . . . . . . .918.00 +13.00 1002.00 716.50 SSL Intl . . . . . . . . . . . . . . . . . . . .850.50 9.50 893.50 481.25
Autonomy Corp . . . . . . . . . . . .1900.00 15.00 1945.00 1121.00 EnQuest . . . . . . . . . . . . . . . . . . .105.00 112.70 87.35 Michael Page Intl. . . . . . . . . . . . .381.20 0.30 461.50 218.50 St Jamess Place . . . . . . . . . . . . .227.50 2.40 296.90 172.25
Aveva . . . . . . . . . . . . . . . . . . . . 1125.00 7.00 1237.00 661.00 Eurasian Nat Res . . . . . . . . . . .1028.00* +2.00 1276.00 582.00 Micro Focus . . . . . . . . . . . . . . . .518.50 +3.50 550.00 300.90 Stagecoach. . . . . . . . . . . . . . . . .182.00 +2.00 204.90 114.75
Aviva . . . . . . . . . . . . . . . . . . . . .336.80 +2.70 474.00 274.75 Euromoney Inst Inv . . . . . . . . . . .587.50* +14.50 630.00 191.25 Millen & Copthorne . . . . . . . . . . .421.00 1.10 496.30 217.25 Standard Chartered . . . . . . . . . .1615.50 33.50 1847.00 1115.00
Babcock International . . . . . . . . .595.50 +6.00 660.50 448.50 Experian . . . . . . . . . . . . . . . . . . .622.00 +1.00 664.50 434.00 Misys . . . . . . . . . . . . . . . . . . . . .256.70 0.10 281.70 157.25 Standard Life . . . . . . . . . . . . . . .181.90 0.20 237.00 172.60
BAE Systems . . . . . . . . . . . . . . .321.20 3.70 389.90 294.20 F&C Comm Prop . . . . . . . . . . . . . .93.65* 0.25 96.80 73.50 Mitchells & Butlers . . . . . . . . . . .310.30 +1.40 343.90 221.75 TalkTalk . . . . . . . . . . . . . . . . . . .122.60 0.40 147.10 106.60
Balfour Beatty . . . . . . . . . . . . . . .254.10* +2.30 328.85 238.50 Ferrexpo . . . . . . . . . . . . . . . . . . .252.80 1.70 396.20 112.00 MITIE . . . . . . . . . . . . . . . . . . . . .227.90 2.50 281.70 204.25 Talvivaara Mining . . . . . . . . . . . .370.30 +10.30 501.50 315.00
Barclays . . . . . . . . . . . . . . . . . . .290.85 +3.00 394.25 255.00 FirstGroup . . . . . . . . . . . . . . . . .388.50 +3.50 448.80 322.75 Mondi . . . . . . . . . . . . . . . . . . . . .407.00 +6.60 488.00 182.00 Tate & Lyle . . . . . . . . . . . . . . . . .473.30 4.30 481.40 284.75
Barratt Development . . . . . . . . . . .99.10 +1.90 193.31 91.80 Foreign & Col Inv Tst. . . . . . . . . .273.90 +2.70 297.20 210.25 Monks Inv Tst . . . . . . . . . . . . . . .292.50 +1.50 321.20 222.00 Taylor Wimpey . . . . . . . . . . . . . . .29.55 +0.07 54.90 27.40
BBA Aviation . . . . . . . . . . . . . . .189.10 +0.70 220.00 105.00 Fresnillo . . . . . . . . . . . . . . . . . .1009.00 4.00 1025.00 438.00 Morrison Wm . . . . . . . . . . . . . . .261.70 3.00 306.30 234.25 Telecity . . . . . . . . . . . . . . . . . . . .403.70 +14.90 455.00 272.00
Beazley. . . . . . . . . . . . . . . . . . . .120.20 +6.00 122.00 86.00 G4S . . . . . . . . . . . . . . . . . . . . . .279.10 +0.10 285.70 197.90 Murray Intl Tst . . . . . . . . . . . . . . .835.00 +12.00 893.50 575.00 Templeton Emrg Mkts . . . . . . . . .538.00 +1.50 598.00 346.50
Bellway. . . . . . . . . . . . . . . . . . . .641.00* 3.00 927.50 591.50 Genesis Emerging Mkts Fd . . . . .460.50 +1.50 484.00 370.00 National Express. . . . . . . . . . . . .226.50 +3.50 256.80 135.08
Berkeley . . . . . . . . . . . . . . . . . . .761.00 +2.00 989.50 735.00 GKN . . . . . . . . . . . . . . . . . . . . . .126.00 0.40 155.00 67.49 National Grid . . . . . . . . . . . . . . .499.00* 0.40 607.65 466.71 Tesco . . . . . . . . . . . . . . . . . . . . .394.20* 7.35 454.90 347.40
BG . . . . . . . . . . . . . . . . . . . . . .1098.00 +28.00 1248.00 966.90 GlaxoSmithKline . . . . . . . . . . . . 1197.00* +33.50 1347.00 1038.50 Next . . . . . . . . . . . . . . . . . . . . . 2117.00* 2.00 2360.00 1402.00 Thomas Cook . . . . . . . . . . . . . . .198.80 +1.80 277.20 189.70
BHP Billiton . . . . . . . . . . . . . . .1871.00 4.50 2346.00 1274.50 Great Portland Estates . . . . . . . .288.00 1.80 332.10 203.75 Northumbrian Water . . . . . . . . . .286.90 +0.20 296.30 219.90 Tomkins . . . . . . . . . . . . . . . . . . .247.30* 0.70 258.50 135.00
BlackRock Mining . . . . . . . . . . . .565.00 5.00 654.50 346.00 Greene King . . . . . . . . . . . . . . . .390.30 +3.50 504.00 359.50 Old Mutual . . . . . . . . . . . . . . . . .108.70* 1.40 127.20 71.00 Travis Perkins . . . . . . . . . . . . . . .761.00 10.00 915.00 461.00
Booker . . . . . . . . . . . . . . . . . . . . .41.60* 0.25 49.50 32.75 Halfords . . . . . . . . . . . . . . . . . . .534.00 +4.00 544.00 299.00 Partygaming . . . . . . . . . . . . . . . .257.00 +2.00 339.70 213.30 TUI Travel . . . . . . . . . . . . . . . . . .224.80 +4.40 313.90 213.80
BP . . . . . . . . . . . . . . . . . . . . . . .391.90* +26.40 658.20 345.15 Halma . . . . . . . . . . . . . . . . . . . . .253.40 1.10 278.50 169.25 Pearson . . . . . . . . . . . . . . . . . . .935.00 3.00 1069.00 574.00 Tullett Prebon . . . . . . . . . . . . . . .340.10 0.20 436.20 261.20
Brit Insurance . . . . . . . . . . . . . . .880.00* +151.00 913.50 709.00 Hammerson . . . . . . . . . . . . . . . .359.30 +0.80 460.30 277.00 Pennon . . . . . . . . . . . . . . . . . . . .539.00 0.50 558.00 434.40 Tullow Oil . . . . . . . . . . . . . . . . . 1162.00 +41.00 1375.00 834.50
British Airways . . . . . . . . . . . . . .199.10 +4.30 255.80 117.30 Hansen Trans . . . . . . . . . . . . . . . .87.00 +1.00 163.50 78.00 Persimmon . . . . . . . . . . . . . . . . .366.60 +5.50 534.50 340.25 UK Commercial Prop. . . . . . . . . . .76.45 1.55 84.90 59.50
British Amer. Tob . . . . . . . . . . .2161.50 +0.50 2335.50 1637.00 Hargreaves Lansdown . . . . . . . .354.50 3.50 387.00 197.25 Petrofac . . . . . . . . . . . . . . . . . .1262.00 +15.00 1294.00 580.00 Ultra Electronics . . . . . . . . . . . .1586.00 12.00 1678.00 1064.00
British Empire Tst . . . . . . . . . . . .429.30* 0.10 467.90 338.50 Hays . . . . . . . . . . . . . . . . . . . . . . .96.35 +0.30 119.00 80.00 Petropavlovsk . . . . . . . . . . . . . .1268.00 13.00 1370.00 515.00 Unilever . . . . . . . . . . . . . . . . . .1898.00* 9.00 2024.00 1419.00
British Land . . . . . . . . . . . . . . . .454.00 4.20 532.00 353.00 Henderson . . . . . . . . . . . . . . . . .130.20 0.20 157.80 83.75 Premier Farnell . . . . . . . . . . . . . .237.90* 6.10 249.70 121.25 United Utilities . . . . . . . . . . . . . .560.00 7.50 575.00 429.00
Britvic. . . . . . . . . . . . . . . . . . . . .472.90* 3.10 497.70 253.25 Heritage Oil. . . . . . . . . . . . . . . . .438.00 +7.50 587.00 409.80 Premier Oil . . . . . . . . . . . . . . . . 1189.00 +29.00 1431.00 984.00 Utd Business Media . . . . . . . . . .517.00 +3.00 579.50 364.75
Brown(N.) . . . . . . . . . . . . . . . . . .262.70 3.00 284.30 204.25 Hikma Pharma . . . . . . . . . . . . . .699.50 +5.00 730.00 412.00 Provident Financial . . . . . . . . . . .850.00* +11.00 986.00 763.00
BSkyB . . . . . . . . . . . . . . . . . . . .586.50 +1.00 637.50 423.75 Hiscox . . . . . . . . . . . . . . . . . . . .342.10 +4.80 369.30 279.50 Prudential . . . . . . . . . . . . . . . . . .535.00 14.50 665.00 350.25 Vedanta Resources . . . . . . . . . .2214.00 6.00 2967.00 1262.00
BT . . . . . . . . . . . . . . . . . . . . . . .135.90 +4.10 151.00 92.30 Hochschild Mining . . . . . . . . . . .310.20 +5.20 370.60 220.00 PZ Cussons . . . . . . . . . . . . . . . .301.80 +5.80 305.50 169.75 Victrex . . . . . . . . . . . . . . . . . . . 1149.00* +29.00 1152.00 498.50
Bunzl . . . . . . . . . . . . . . . . . . . . .724.00* 6.00 784.50 478.50 Home Retail . . . . . . . . . . . . . . . .233.70* +5.40 336.50 224.80 Qinetiq . . . . . . . . . . . . . . . . . . . . 119.80 +1.40 179.10 113.90 Vodafone . . . . . . . . . . . . . . . . . .140.00* +0.60 153.80 111.90
Burberry . . . . . . . . . . . . . . . . . . .786.00 +2.00 803.50 359.00 Homeserve . . . . . . . . . . . . . . . .2060.00 35.00 2190.00 1336.00 Randgold Resources. . . . . . . . .6075.00 25.00 6285.00 3351.00 VT . . . . . . . . . . . . . . . . . . . . . . .765.00 +4.00 773.00 416.00
Cable & Wire Comms . . . . . . . . . .56.50* 0.50 150.00 53.00 HSBC Hldgs . . . . . . . . . . . . . . . .646.80* +2.30 766.80 487.00 Reckitt Benckiser . . . . . . . . . . .3237.00 1.00 3667.00 2686.00 Weir . . . . . . . . . . . . . . . . . . . . . .950.50 5.50 1076.00 437.50
Cable & Wire Wwide . . . . . . . . . . .88.85* +3.85 94.80 68.60 Hunting . . . . . . . . . . . . . . . . . . .462.50 +10.80 659.50 377.00 Reed Elsevier . . . . . . . . . . . . . . .494.60 +11.10 548.00 403.75 Wetherspoon(J.D.) . . . . . . . . . . .425.50 +6.20 556.00 348.00
Cairn Energy. . . . . . . . . . . . . . . .419.20 +11.30 441.50 306.80 ICAP . . . . . . . . . . . . . . . . . . . . . . 411.30 +6.30 478.30 291.70 Regus . . . . . . . . . . . . . . . . . . . . . .82.85 0.50 125.50 58.75 WH Smith . . . . . . . . . . . . . . . . . .441.30* +6.10 551.00 405.25
Caledonia Invs . . . . . . . . . . . . .1613.00 +22.00 1759.00 1459.00 IG . . . . . . . . . . . . . . . . . . . . . . . .428.20 +5.90 446.10 256.50 Rentokil Initial . . . . . . . . . . . . . . . 117.00 1.90 140.20 82.25 Whitbread . . . . . . . . . . . . . . . . .1401.00* 9.00 1645.00 778.50
Capita . . . . . . . . . . . . . . . . . . . . .794.50 829.50 643.50 Imagination Tech Gp . . . . . . . . . .265.20 6.80 289.30 83.00 Resolution . . . . . . . . . . . . . . . . . .60.30 0.20 99.15 58.45 William Hill . . . . . . . . . . . . . . . . .180.20 +1.60 217.80 160.50
Capital & Counties . . . . . . . . . . .108.00 +2.10 125.40 99.60 IMI . . . . . . . . . . . . . . . . . . . . . . .672.00 0.50 742.00 275.25 Rexam . . . . . . . . . . . . . . . . . . . .315.20 2.10 330.50 222.50 Witan Inv Tst . . . . . . . . . . . . . . . .438.50 +1.50 487.00 329.50
Capital Shopping Centres . . . . . .331.50 +2.50 580.00 300.20 Imperial Tobacco. . . . . . . . . . . .1899.00 +2.00 2159.00 1547.00 Rightmove . . . . . . . . . . . . . . . . .689.00* 18.50 729.00 334.00 Wolseley . . . . . . . . . . . . . . . . . .1588.00 9.00 1742.00 986.00
Carillion . . . . . . . . . . . . . . . . . . .328.70* +0.60 361.90 236.75 Inchcape. . . . . . . . . . . . . . . . . . .263.20 +0.90 347.00 253.20 Rio Tinto . . . . . . . . . . . . . . . . . .3214.50 47.50 4104.00 1822.00
Carnival . . . . . . . . . . . . . . . . . .2588.00* 2937.00 1431.00 Informa . . . . . . . . . . . . . . . . . . . .391.50 0.70 439.40 216.00 RIT Capital Partners . . . . . . . . .1084.00 5.00 1159.00 861.50 Wood Group (John). . . . . . . . . . .315.00 +10.90 411.70 231.25
Catlin . . . . . . . . . . . . . . . . . . . . .346.90 +20.50 380.50 284.75 Inmarsat . . . . . . . . . . . . . . . . . . .818.00 +3.00 822.00 491.00 Rolls Royce . . . . . . . . . . . . . . . .592.50* 7.00 631.50 325.00 WPP . . . . . . . . . . . . . . . . . . . . . .680.50 5.00 744.00 380.50
Centrica . . . . . . . . . . . . . . . . . . .286.80* +2.00 320.00 212.50 Intercontl Hotels . . . . . . . . . . . . 1155.00 +14.00 1175.00 584.50 Rotork . . . . . . . . . . . . . . . . . . .1337.00 10.00 1482.00 779.50 Xstrata . . . . . . . . . . . . . . . . . . .1000.00 3.00 1344.50 555.10
Charter Intl . . . . . . . . . . . . . . . . .688.00 +11.00 855.50 395.25 Intermediate Capital . . . . . . . . . .259.70 +2.60 332.00 170.25 Royal Bank Of Scot . . . . . . . . . . . .42.37 0.79 58.95 28.25 Yell Group. . . . . . . . . . . . . . . . . . .28.60 +2.54 86.00 20.25
Chemring . . . . . . . . . . . . . . . . .3325.00 48.00 3711.00 1910.00 Intertek . . . . . . . . . . . . . . . . . . .1425.00* +1.00 1576.00 987.50 Royal Dutch Shell A . . . . . . . . .1792.00 +30.50 2068.50 1431.00 LONDON TOP 250 BY MARKET CAPITALISATION
Chloride Group . . . . . . . . . . . . . .346.60 +2.70 346.60 129.00 Intl Power . . . . . . . . . . . . . . . . . .305.40* +5.00 354.00 228.00 Royal Dutch Shell B . . . . . . . . .1714.00 +30.00 1997.50 1437.00
Close Bros . . . . . . . . . . . . . . . . .697.50 2.50 806.50 623.00 Invensys . . . . . . . . . . . . . . . . . . .273.50 5.60 350.30 212.25 RSA Insurance . . . . . . . . . . . . . .121.70 +2.50 142.00 113.10 * Ex-Dividend Suspended
Cobham . . . . . . . . . . . . . . . . . . .232.00* 1.30 278.60 164.90 Investec . . . . . . . . . . . . . . . . . . .483.40 2.40 565.00 309.75 SABMiller . . . . . . . . . . . . . . . . .1930.00 25.00 2090.00 1210.00
COLT Group . . . . . . . . . . . . . . . .132.30 2.60 144.20 98.25 ITV . . . . . . . . . . . . . . . . . . . . . . . .56.00 +0.75 71.75 31.75 Sage . . . . . . . . . . . . . . . . . . . . . .242.00* 4.20 260.50 167.20 www.interactivedata.com

*
 !"

&&&#('$
# 
 #" ! "
  )  # ) !(  ) ! 
 # " !" % $! $! !# $!" (
 !" &!  $! !  ( $#$! " ! # !#"
!"
+
     ! ##  !"$#  """ ## ' ($! #  "#

US data set to give clues on economic outlook

could affect the global economy. couple of days, Dickson said. ANALYSIS l Dow Jones
THENEW YORK The Standard & Poors 500 index is
now down 10.3 per cent from its 23
The euro fell against the dollar on
Friday. But that was its first daily 10,211.07
11 Jun

REPORT April closing high for the year, and decline since Monday, when it hit 11,200
considered in correction territory. $1.1876 its lowest level since 2006.
Weve gone through a period of Wall Street will keep a weather eye 10,800
extreme nervousness... and problems this week on the recovery in the US

U
S stock investors will keep a havent gone away, but I think right housing sector, still deemed fragile 10,400
close eye on Europe this week, now, global investors are little less jit- with the expiration of a federal tax
looking for signs the debt crisis tery, said Fred Dickson, chief market credit for home buyers. 10,000
may be stabilising, while indus- strategist at DA Davidson & Co in Lake US housing starts and building per-
9,600
trial production, housing starts and Oswego, Oregon. mits for May will be released on 24 Mar 5 Apr 14 Apr 23 Apr 4 May 13 May 24 May 3 Jun
inflation data may offer more clues The Chicago Board Options Wednesday. Economists forecast that
on the US economic outlook. Exchanges Volatility Index or VIX, a housing starts will slip to an annual
On Friday, an official said the measure of Wall Streets anxiety, slid pace of 650,000 units in May from ANALYSIS l S&P 500
European Union has reached agree- 5.82 per cent to end at 28.79 on Friday Aprils pace of 672,000 units. 1,250 1,091.60
ment with Greece on how to move after rising more than 20 per cent a Both the Producer Price Index and 11 Jun
forward with pension reform, while week ago. the Consumer Price Index for May are 1,200
Spains economy ministry said it has The three major US stock indexes expected from the US government.
not made and will not make a finished with gains for the week, with The overall PPI for May, also due on 1,150
request for economic aid from the the Dow Jones industrial average up Wednesday, is forecast to fall 0.5 per
1,100
EU. 2.8 per cent, the S&P 500 up 2.5 per cent, compared with a 0.1 per cent
Market sentiment has been cent and the Nasdaq Composite Index dip in April. Core PPI, excluding 1,050
plagued for weeks by worries that up 1.1 per cent. volatile food and energy prices, is
European debt problems, including I will be looking to see if the euro forecast to edge up 0.1 per cent in 1,000
those in Greece, Spain and Hungary, holds gains that we saw in the last May, after rising 0.2 per cent in April. 24 Mar 5 Apr 14 Apr 23 Apr 4 May 13 May 24 May 3 Jun
 City Focus
Takeover panel
review is wise
and thoughtful
Protecting shareholder democracy is central
to recommendations, and quite right too
PHILIP BROKE
CORPORATE PARTNER, WHITE & CASE
T
HE consultation document issued by
the Takeover Panel shortly after the
panels censure of Kraft over its suc-
cessful hostile takeover of Cadbury,
unusually does not contain changes to the
Takeover Code recommended by the
panel. Rather, the Takeover Panel is seek-
ing to provide a forum in which sugges-
tions for possible changes may be
debated, by setting out those suggestions
for the reform of the Takeover Code put
forward by commentators, plus a few
thoughts of its own. The panel is rightly
trying to ensure that it remains at the cen-
tre of any debate on the issues.
The angst expressed by certain politi-
cians and industrialists at the time of the
Kraft takeover centred around three key
issues: Krafts closure of Cadburys
Somerdale factory in favour of one in
Poland, despite reassurances against this;
the ease with which a major British com-
pany was taken over; and that some share-
holders who eventually accepted Krafts
bid had bought shares after the takeover
process began. By criticising Kraft over the
first issue and separately consulting on
Corporate code could foster short-termism
FRANCES LE GRYS
CORPORATE PARTNER, HOGAN LOVELLS
T
IDJANE Thiam of the Pru may well
be grateful that the new Corporate
Governance Code with its require-
ment for all directors of FTSE 350
companies to be subject to annual re-elec-
tion by shareholders only takes effect
from 29 June this year.
At the heart of the new code is a focus
on the long-term success of a company.
Yet with the new proposal, directors must
effectively justify their performance to
shareholders annually or face being voted
out at the AGM. Does this raise the spec-
tre of short-termism? And how can this
| Law
the second and third, the panel is demon-
strating that they are different points. The
commentators had combined an industri-
al policy issue with a shareholder control
issue.
HIGHER HURDLES
The second issue is one of public policy:
should there be higher hurdles to impor-
tant British companies being taken over?
The Takeover Panels job is not to protect
the British economy: that falls to govern-
ment. The panels careful introduction to
the consultation paper, setting out its role
in words that will be familiar to this news-
papers readers, should steer any responsi-
bility for industrial policy to government,
where it belongs. The Cadbury takeover
The third criticism of the Kraft takeover, was controversial.
which the consultation paper is setting
out for debate, is that some shareholders
who accepted the offer had purchased
their shares after the takeover deal was
announced. The commentators wanted to
exclude latecomers from affecting the out-
come of a takeover. That aim divided
shareholders into short-term and long-
term shareholders, creating a false divide
between groups of shareholders.
The divide is false because the commen-
tators at the time were looking to long-
term shareholders to protect a major
British company while not expecting
short-term shareholders to act on that
basis. Both groups have a single aim: to
achieve a favourable financial result for
their own investors, be they institutional
or retail. The suggestions of the commen-
tators, which include imposing a super-
new requirement of annual re-election
with the result that directors may feel the
need to take short-term decisions for the
sake of investor backing sit with the
need to focus on what is best for the com-
pany over a longer time-frame? Can long-
term success be gained by a mechanic
which potentially encourages short-term
behaviour?
The proposal of annual re-election had
attracted a mixed response during the
consultation phase. Sir David Walker had
worried that annual elections might be
accountability in too short a time frame
and did not recommend it in his Walker
Review, although he has subsequently
publicly stated he now regards it as a
good thing. The view as to whether annu-
al re-election is likely to be an effective
tool for ensuring better boardroom behav-
iour is typically split depending on which
camp you are in. Those who do not like
the proposal typically companies and
directors point to the potentially desta-
bilising effect. Annual re-election, its
detractors say, can amount to little more
HOW TO FILL
YOUR POCKETS
SEE MENS FASHION P30
majority (say 67 per cent or 75 per cent)
threshold for takeovers to be allowed and
the withholding of voting rights for share-
holders who purchased shares after a
takeover bid was launched, will only
undermine shareholder democracy
(majority rule) and shareholder equality
(by distinguishing between good and
bad shareholders).
As the consultation paper gently shows,
these suggestions would have much wider
and probably undesirable consequences
and require changes to UK and European
law, fundamentally because they are
inconsistent with the principles of share-
holder democracy.
The other ideas in the consultation
paper are thoughtful, if rather technical,
but largely would have little effect on the
result the commentators wanted. One par-
ticular suggestion merits further thought
in the panels open forum: should bidders
than a popularity contest, so that to con-
tinue to be supported by shareholders,
directors have to make potentially unwise
decisions that deliver an immediate or
obvious benefit to those shareholders.
The benefits of some decisions may also
not be best viewed on their short-term
merits often more time is needed to
appreciate the full benefit.
DIRECT VOICE
Conversely, investors have made the point
that annual re-election gives sharehold-
ers who are, after all, the owners of the
company a more direct voice into the
key issues affecting the company and that,
going forward, directors will ignore that
shareholder voice at their peril. If ignoring
the concerns of shareholders means those
shareholders voting against you, the feel-
ing is that there is now a very real impetus
to listen to what shareholders have to say.
Boards could, of course, choose to over-
look this: as a comply or explain
requirement, a FTSE 350 board could
explain why it thinks annual re-election
27
by pushed into disclosing more about
their future plans than they currently do
in practice? That change might allow
some interest groups, such as employees,
to have a greater influence on the out-
come of a takeover. It is a proper subject
for debate as to whether that would pro-
duce better results in takeovers; the panel
noted that Cadbury had already decided
to close Somerdale long before the bid.
The major suggestions in the consulta-
tion paper are there because the commen-
tators raised them, not because the panel
recommends them. They would be a mis-
take and would undermine shareholder
democracy in the UK market and the UKs
long-earned reputation for fairness and
predictability. If there is a need for greater
protection for major British companies,
that is a matter for industrial policy, not
takeover mechanics, and should be debat-
ed and legislated for accordingly.
is not appropriate in its case. But it is hard
to see many standing their ground on
this one. So how concerned do directors
have to be? Currently the requirement is
for directors to seek re-election at least
every three years and to date blocking re-
election is not a remedy that has been
widely or lightly used. It is reported that
between 2000 and 2009 only 19 directors
in nine companies across the whole FTSE
all-share index were not reappointed.
Clearly investors are a long way from
being trigger happy where this right is
concerned.
This brings us to another part of the
code the need for shareholder engage-
ment. The code requires boards to speak
regularly to shareholders and sharehold-
ers to express their views to the board.
Properly done, the spectre of being voted
off should not be a tangible threat. It is a
weapon in the armoury of dissatisfied
shareholders, but the evidence would sug-
gest that speaking to shareholders regu-
larly means it is one that they do not
need or want to deploy.
 Lifestyle
28
Jungles, sea
and history in
old Malaysia
A potent mix of adventure and culture make
for a brilliant Asian holiday, says Zoe Strimpel
A
100-mile ferry-ride across the South
China Sea is Langkawi, one of the
worlds most idyllic spots for sun-
bathing, swimming in crystal
green waters framed by lush jungle, and
the total luxury of a world-class beach
resort. Its gorgeous but probably quite
similar to retreats in Thailand, Indonesia,
the Caribbean, Costa Rica, Mauritius...you
get the idea.
But I have flown across the world
albeit in the splendid, Champagne-washed
comfort of Singapore Airlines bodacious,
super-genteel flat-bed business class to go
somewhere that is distinctly, uniquely
Malaysia. And now I am on a beach in
outer Penang, one of Malaysias two
UNESCO heritage cities, and the heavens
are gathering themselves together for a
monumental storm. Its been 35 degrees
and 95 per cent humidity again, so Im
ready, along with the skies, for a big dump
of precipitation.
Before the rain starts in earnest, in those
last gusty minutes, I run past signs warn-
ing of giant jellyfish and dive, sweating,
into the murky sea. Its like bath water, but
I cant see even my hands, so with the
thought of that jellyfish sign returning to
my mind, I decide to quit while Im ahead.
Back on the beach, I stroll through the
glowering clouds along the beach, attract-
ed by a pretty cove at the end, where
colourful local fishing boats cluster.
But I dont make it. Because I suddenly
see a sight so terrifying, so extraordinary,
and so weird, that I stop in my tracks.
Creeping along the beach towards the
water is a monster. Its low-slung creeping
movement is unrecognisable, as is its six-
foot length and hefty girth, small head
and black colour. It heads straight into the
water, has a bit of a swim, its little head
poking out (maybe its just a weird dog, I
think), before sliding out and hesitantly
creeping back to where it came from.
Fresh with horror, I tell the tale to the
first person I know back at the hotel, who
happens to be Singaporean. Its a giant
monitor lizard Im told, practically still a
dinosaur, and its related to the giant
komodo dragon of Indonesia. Oh, I say. If
Id seen it while swimming Id surely have
CITYA.M. 14 JUNE 2010
| Travel
had heart failure.
Luckily I wasnt swimming the next day,
when our National Park guide Joseph,
super-sexy jungle-man and ex-banker,
pointed out several giant monitors float-
ing and clambering over the rocks. The
South China Sea, as we saw that day, also
contains a delectable salad of squid, four-
foot jellyfish, and something called sea
cockroaches (little grey creatures whose
flesh Joseph describes as sweet and juicy).
In short, beautiful though this part of
Malaysia is, it is no white-sand n palm
tree resort. Its for travellers after some-
thing a little more authentic. Jungle, mon-
keys, culture and fabulous food can be
found in abundance off the beaten path in
Malaysia. Our taster began with Kuching,
in the state of Sarawak on the island of
Borneo, and then moved to Penang.
KUCHING
It was a bit of a shock going from 12 hours
in the lap of aero-luxury, waited on by a
brigade of beautiful flight attendants, to a Top: a boatman wild boars (which we saw mainly snuffling skilled handiwork, extraordinary hospi-
musty business hotel in the charmless, lingers in a Borneo near the toilets), numerous snakes and tality and dodgy sanitation, for yourself.
industrial capital of Borneos biggest state, waterway; above: the countless species of birds and vegetation. As we were pressed for time, we com-
Sarawak (Borneo is the third largest island river in Kuching. Borneo is known for its enthusiastic leech- promised with a catch-all trip to the
in the world, and also includes Sabah in es, but we didnt see any. The proboscis Sarawak Cultural Village (www.
Malaysia and Kalimantan in Indonesia). Pictures: GETTY, SXC, monkeys were deeply enthusiastic in their scv.com.my). It sounds dire, but its a very
But Kuching, through which a majestic REUTERS courtship of our food; meanwhile our neat recreation of all the different long-
but murky river runs, stands out for two calm, knowledgeable guide (from special- houses and their tribes; each one
main reasons. One, it is the gateway to the ist operators Diethelm Travel, manned by a real tribesperson or per-
splendours of Sarawak, which include www.diethelmtravel.com), pointed out sons. Some involve lovely dance perform-
orang-utans in their natural habitat we some brilliant green, poisonous snakes. ances, others feature women placidly
saw them from a bit of a distance in the The mangroves are also home to an cooking delicious sugary treats over open
trees of the Semenggok Rehabilitation impressive ecosystem look closely and flames. To cap off our tour was a highly
Centre. Two, the food particularly the you can see whole communities of crabs, entertaining showcase of all the tradi-
street (or hawker food) was some of the mud lobsters, fleas, insects, birds and tional long house dances, with troupes of
best Ive ever had. other creatures burrowing busily. highly attractive, beautifully regaled
men and women performing dances that
BAKO LONGHOUSES were both entertaining and poignant.
Our first port of call was the Bako National Another of Sarawaks great attractions
Park, which we arrived at via a terrifically are its longhouses, dwellings in which FOOD
fun motorised dinghy ride through the tribes live without much modern inter- Lunch on both days was a simple but
seething, pale blue chop, past cliffs that vention, surviving from traditional craft- utterly satisfying mixture of fragrant
rise eerily from the middle of the sea. work. Some Borneo longhouse tribes fresh white fish, plantain-style veggies,
There are 11 national parks in Sarawak have traditionally practised head hunt- morning glory (a weed-like green) and
one of which features the largest cave ing in the Heart of Darkness sense, not rice wrapped in palm leaves. But for din-
chamber in the world (Gunung Mulu recruitment. But youre safe these days if ner, we had treats in store. The setting
Park). But Bako one is the oldest and is you fancy a visit many tour operators was far from elegant: the Top Spot Food
home to the rare proboscis monkey, long- offer overnight trips to longhouses where Court, a traditional Malay and
tailed macaques and silver leaf monkeys, you can witness the decorative costumes, Singaporean formation of stalls spread
CITYA.M. 14 JUNE 2010
Above: traditional archi-
tecture in old Penang
(George Town), above
right: a Chinese temple in
Penang, right: an orang-
utan in its native Borneo.
round a central plaza of plastic tables.
You go up to the stalls, give your table
number and open sesame. The food so
inexpensive it makes European eyes water
comes thick and fast. We had enormous
prawns in super-rich butter sauce (I made
myself sick on these through greed); whole
deep-fried fish doused in addictive chilli
and garlic sauce; crispy fried duck and an
array of veggies. To wash it down we had
fresh watermelon juice and carrot milk (
carrot juice and milk). This was one of my
most memorable meals in years, but if
youre planning on boozing, you might try
it in a less Islamic country than Malaysia.
PENANG
Nature guide Joseph, mentioned above,
was the most passionate naturalist I have
ever come across. But never have I seen
such fervent city historians as those I met
in Penang, where everyone is an amateur
scholar with a true love of their city.
Penang is indeed a rich hodgepodge of
colonial, Indian, Chinese and Malay influ-
ences, with a distinctive cuisine and lots
and lots of restored houses-turned-
museums. The volume of restored build-
ings is testimony to the Penangites pride
in their heritage. In 1786, Captain Light of
the British East India Company landed in
Penang and named it Prince of Wales
Island in honour of home. He married the
daughter of the Sultan of Kedah, Penangs
ruler, and got the region in his dowry, but
shortly afterwards he ceded the state to
the Indian government. A rendition of his
home in the city, Suffolk House, has been
turned into a museum thats worth a
quick spin around.
HISTORY
In 2008, George Town, the historic capital
of Penang, was granted UNESCO World
Heritage Site status alongside fellow
Straits settlement Malacca. Indeed, locals
beam with pride at George Towns shop-
front houses and richly colourful tem-
ples. Penang has one of the largest
collections of pre-war buildings in South-
East Asia and its a pleasure to wend your
way among the low shuttered houses and
browse wares from hats to betel nut snuff
to Indian pastries.
As for colonial history, the blue Cheong
Fatt Tze (1840-1916) mansion is a must-see:
its self-made, Chinese owner furnished it
with breathtaking opulence pearl, fine
tile-work and, of course, perfect feng shui.
MENS GROOMING 29
GOES UP A NOTCH
IN HEALTH
TOMORROW
TRAVEL NOTES
ZOE STRIMPEL
Summer savings in Mauritius
Escape unreliable British weather with a trip to this heavenly Ayurvedic retreat in Mauritius,
currently offering savings to the tune of 1,525 per person. If you stay seven nights you get a
reduced room rate as well as a free daily round of golf. Seven days from 1,455 per person.
Includes accommodation in a Junior Suite with ocean view, breakfast, flights from London
with British Airways and private transfers. Valid until 31 Oct 10. Book before the end ofJuly.
Call Seasons in Style on 01244 202 002; www.seasonsinstyle.com.
If the museum isnt enough to satisfy you,
the mansion also has elegant guest rooms
with relics from Tzes time (www.cheong-
fatttzemansion.com). ...and Thailand
Overlooking a sandy bay on the north-eastern tip of Thailands most beautiful island Koh Pha-
CUISINE ngan sits Santhiya Resort & Spa, a haven for families with a range of attractions. Theres dry
Again, Penangites are very proud of their weather in July and August, so book now for savings of up to 900 per family. Seven nights
cuisine, particularly the street-food style from 3,249 per family based on two adults and two children sharing, with return economy
(sold at hawker stalls). The fish laksa is flights with Oman Air and Bangkok Airways. Valid for travel before 31 July only. Call Tropical
famous, but hard to stomach, loaded as it is Sky on 0845 543 2155 or go to www.tropicalsky.co.uk.
with prawn paste. A delicious alternative is
hokkien mee: rich prawn and pork stock
with rice and egg noodles, hard boiled
eggs, prawns, meat slices, bean sprouts and
water spinach. There are heaps of other
lovely curry-style dishes, and lots of creative
ways with shellfish.
If youre feeling brave, go for Lau Hau
Peng which is nutmeg juice I found it
extraordinarily unpleasant, but others love
it. If you tire of Hawker food, there are sev-
eral nice restaurants to choose from the
brand new quayside QE2 was particularly
swish, with stunning harbour views and
elegant, interesting food. Perut Rumah on
Kelawei Road was another gem: brilliant
local food served in a converted mansion.
But the most seductive eatery of all partic-
ularly if you want a break from potent local
flavours is Kopi Cine at the Straits
Collection, a gorgeous, meticulously
restored boutique hotel spanning several
blocks of George Town (www. straitscollec-
tion.com.my).
Your brain will be buzzing, your belly full
and your legs tired after a trip round just
two of Malaysias densely captivating states. Kingfisher gets closer to Oneworld
Singapore Airlines flies from London to Indian airline Kingfisher has just gained membership-elect status of the worlds premier avia-
Singapore for 693 return. Business class starts tion alliance, Oneworld. Should it make the grade, the Oneworld membership will move
at 3,330 return. Silk Air, the airlines local sub- Indias leading airline considerably up in the world, particularly thanks to a code-sharing deal
sidiary, has flights between Singapore and with British Airways. Should it clear Oneworld entry requirements, 56 Indian cities will be
Kuching for 139; Singapore and Penang for added to the alliances map. Which can only be a good thing for those of us ready to explore
154. www.singaporeair.com; www.silkair.com hidden gems in the country. www.flykingfisher.com
 30 Lifestyle | Mens Fashion
2 Tim
1
How to fill
your pockets
Nothing says style
quite like a subtly
plush, richly crafted
wallet, believes
Timothy Barber
1 Aspinal of London billfold coin wallet, 59, www.aspinaloflondon.com 2 Mulberry zip
around wallet, 165, www.mulberry.com 3 Louis Vuitton Utah leather cards and bill
holder, 375, www.louisvuitton.com 4 Berluti Caiac pocket organiser, 280,
www.berluti.com 5 Dunhill ostrich leather coat wallet, 585, www.dunhill.com
6 Zilli Traveller wallet, 4,825, www.zilli.fr 7 Simon Carter travelcard wallet, 49,
9 www.simoncarter.net 8 Thomas Lyte billfold wallet, 150, www.thomaslyte.com 9
Aspinal of London slim breast wallet, 65, www.aspinaloflondon.com
MENS FASHION NEWS
TIMOTHY BARBER
CITY GETS GIEVES AND HAWKES
Anyone walking through Leadenhall Market
recently should have noticed the arrival of the
spectacularly swanky new shop from Savile
Row tailoring institution Gieves & Hawkes. In a
Georgian building on Lime Street it covers
1,000 square feet, and looks as smart as a St
James gentlemens club with oak floors, pan-
elled walls and a huge 18th century map of the
City. The shop is home to the companys
exceedingly sharp ready-to-wear collection,
and also offers a made-to-measure service. You
can arrange bespoke appointments in advance,
while Gieves & Hawkes will also send a cutter
to company offices. Gieves & Hawkes, 15-18
Lime St, Corner of Leadenhall Market, EC3M
Men: get thee to Lime Streets new Gieves and Hawkes. 7AN. www.gievesandhawkes.com
4 3
5 the first time at the door of Number 10 they
6
7 because it breaks more easily when you
8 utes, even while appearing to conform and
MOCK-UP AT POKIT
Tailoring of a different kind is the order of the
day at Pokit, a two-person fashion business
creating terrific casual suits at its brand new
Soho boutique.
Rather than measuring people up, former
scientist Bayode Oduwale and stylist Claire
Pringle fit customers out in a mock-up suit
that they pin into the right fit. What this
means is that you have a much clearer idea of
how your suit will look, and it takes just two
weeks after that to be made. Cloths are all top
notch and impeccably sourced the corduroy
numbers are particularly sharp and the
house styles are effortlessly cool. So too are
the shoes, bags and ready-to-wear line. Pokit,
132 Wardour St, W1F 8ZW. www.pokit.co.uk.
CITYA.M. 14 JUNE 2010
TO VENT? OR
JUST TO FLAP
Barber
Style
Counsel
C
AMERON and Clegg may be just about
succeeding in diverting attention away
from their differences, but as any sea-
soned politico will know, its in the fine
details that things get interesting which is
also what a tailor would say. When the new
Prime Minister and his deputy appeared for
presented a picture of unity, but in one small
detail their suits told a different story.
This is all about vents the slits inserted
at the rear of a jacket to aid its hang. When
you choose a suit, you have the option of a
rear flap with a slit either side or a single
vent at the back. Cameron has chosen the
rear flap while Clegg has favoured the single
vent. It may seem like a minor detail, but as
with other tailoring decisions size of lapels,
number of buttons, turn-ups or not it can
say a lot about its wearer.
The rear flap with two vents is the classic
English formal style and the look youd
expect to see in the City, so perhaps it is no
surprise that patrician Cameron has gone for
it. James Sleater of City tailoring outfit Cad
& the Dandy says this is the style hed gener-
ally recommend. It creases a lot less
move or sit down, so its more practical and
hangs more smartly.
The single vent, while not exactly infra dig,
is certainly a bit more quirky according to
Sleater. Originally created for horse riding
so that the jacket can break over the saddle
its more popular in America than in this
country. It puts across a non-conformist
message, says Sleater, pointing out that in
the first TV debate Cleggs lighter blue suit
made him stand out from the more sombre-
ly-attired Cameron and Brown. Its a very
good example of how a suit can portray the
message youre trying to put across.
You have to be careful with single-vent
jackets sit the wrong way, put your hands
in your pockets or simply have too rotund a
physique, and the vents will part at the back
and your bum will be on show. The double
vent denotes safety and classic lines, but if
you want to trump your progressive attrib-
you can pull it off the single vent could be a
goer.
Clegg: a progressive vent, Cameron: a staid flap.
CITYA.M. 14 JUNE 2010 Lifestyle | TV& Games 31

BBC1 BBC2 ITV1 CHANNEL4 FIVE

TERRESTRIAL
6pm BBC News
6.30pm BBC London News
7pm Match of the Day Live:
2010 FIFA World Cup: Italy v
Paraguay (Kick-off 7.30pm).
10pm BBC News
10.25pm Regional News
10.35pm CHOICE The Graham
Norton Show: With Amanda
Holden, Bill Bailey and Kelly
Rowland.
11.20pm FILM Deceived:
Psychological thriller, starring
Goldie Hawn 1991;
Springwatch Weatherview
1.10am Sign Zone: Luther 2.10am
Sign Zone: Museum of Life 3.10am
Sign Zone: Battle for North America
4.10am-6am BBC News
6pm Eggheads
6.30pm Great British Railway
Journeys
7pm Make Me a New Face:
Hope for Africas Hidden
Children: Ethiopian children
with facial disfigurement
caused by disease.
8pm Springwatch 2010
9pm CHOICE Mary, Queen of
Shops
10pm Match of the Day: 2010
FIFA World Cup
10.30pm Newsnight: Weather
11.20pm Tribal Wives
12.20am When Romeo Met
Juliet
1.20am BBC News 4.10am-6am
Close
6pm London Tonight
6.30pm ITV News
7pm Emmerdale: Diane returns
from France in high spirits.
7.30pm CHOICE Coronation
Street
8pm Countrywise
8.30pm Coronation Street
9pm Taggart: A lecturer is
stabbed to death during a knife
demonstration.
10pm ITV News at Ten
10.30pm London News
10.35pm World Cup Highlights
11.35pm Total Emergency
12.30am The Zone; ITV News
Headlines
2.30am The Jeremy Kyle Show
3.25am-5.30am ITV Nightscreen
6pm The Simpsons: Marge
protests about TV violence.
6pm Home and Away
6.25pm Live from Studio Five
TV PICK
6.30pm Hollyoaks: Eva receives 7.30pm How Do They Do It?
a frosty reception from Ravi Five News Update
and Anita. 8pm Police Interceptors: Five
7pm Channel 4 News News at 9
8pm Dispatches: How the 9pm Extraordinary People:
Banks Won: Will Hutton Hayley The 96-Year-Old
investigates the risk of another Schoolgirl
economic crash. 10pm Crimes That Shook the
9pm Gladiators: Back from the World THE GRAHAM NORTON SHOW
Dead: Recreating the world of 11pm Justin Lee Collins: Good Times BBC1, 10.35PM
the Roman arena. 12am Extreme Fishing with Robson The host is joined by Britains Got Talent
Green: Highlights of the series. 1am
10pm Big Brother: judge Amanda Holden and comedian
SuperCasino: Live interactive
11.15pm Eddie Izzard: Dress to gaming. 4am Wildlife SOS 4.25am
Bill Bailey, and singer Kelly Rowland
Kill Wildlife SOS 4.55am Rough Guide performs her latest single, Commander.
12.30am Poker to Adventures 5.05am The New
1.25am Big Brother: Live Tomorrow 5.35am-6am Michaelas
5.25am-6.10am Win My Wage Wild Challenge

SKY SPORTS 1 World of Golf 11pm WWE: Late LIVING E4 DISCOVERY HOME &
SATELLITE & CABLE

6pm Live Twenty20 Cup Cricket
9.30pm Footballs Greatest
10pm World Cup Report
10.30pm Footballs Greatest
11pm Rugby Union 11.30pm
Time of Our Lives 12.30am
Footballs Greatest 1am
Twenty20 Cup Cricket 3am
Soccer AM: The Best Bits 4am
Watersports World 5am-6am
Max Power
SKY SPORTS 2
6.30pm US Open Official Film
2007 7.30pm Live Speedway
10pm Boots n All 11pm US Open
Official Film 2007 12am Golfing
World 1am European Tour Golf
2am PGA Tour Golf 3am
Wonderful World of Golf 4.30am
US Open Official Film 2007
5.30am-6am FIFA Futbol
Mundial
SKY SPORTS 3
6.30pm NASCAR 7.30pm
European Tour Golf 8.30pm PGA
Tour Golf 9.30pm Wonderful
Night Bottom Line 12am
WWE: Late Night Afterburn
1am WWE: NXT 2am Live
WWE: Late Night Raw 4.15am
Footballs Greatest 4.45am-
5.15am Fishing Gurus
BRITISH EUROSPORT
7pm Eurosport Flash 7.05pm
Soccer City Flash 7.15pm FIFA
World Cup Giants 7.45pm
MotoGP 9.15pm Cycling
10.25pm Eurosport Flash
10.30pm Soccer City 11pm
Eurosport Flash 11.05pm Cycling
11.35pm Motorsports Weekend
11.50pm-12.20am Soccer City
ESPN
7pm ICC Cricket World 7.30pm
NBA 9.30pm NBA Fastbreak
10pm Basketball: FIBA World
Magazine 10.30pm ICC Cricket
World 11pm South Africa Nightly
11.30pm The Ultimate Fighter
12.30am Press Pass 2010 1am
Live NHL Ice Hockey 4am-6am
Ultimate Fighting Championship
7pm Ghost Whisperer 8pm
Changing Faces 9pm Four
Weddings 10pm Step Kids Don't
Ruin My Big Day 11pm Criminal
Minds 12am Medium 1am CSI:
Crime Scene Investigation 2am
Exposed: George Clooney 3am
The Fresh Prince of Bel-Air
3.50am Maury 4.40am Nothing
to Declare 5.30am-6am Home
Shopping
BBC THREE
7pm Total Wipeout 8pm Snog,
Marry, Avoid? 8.30pm The Wags
Stories 9pm Gavin & Stacey
9.30pm Lee Nelsons Well Good
Show 10pm Russell Howards
Good News 10.30pm Bizarre ER
11pm Family Guy 11.45pm Gavin
& Stacey 12.15am Lee Nelsons
Well Good Show 12.45am Russell
Howards Good News 1.15am
Match of the Day: 2010 FIFA
World Cup 2.55am Total
Wipeout 3.55am Bizarre ER
4.25am-5.25am Wags, Kids and
World Cup Dreams
7pm Hollyoaks 7.30pm My Name
Is Earl 8pm Friends 9pm Glee
HEALTH
7pm Baby Tales 8pm Jon and
10pm One Tree Hill 11pm FILM Kate Plus 8 9pm Bringing Home
The Omen 2006. 1.10am-6am
the Babies 10pm I Didnt Know I
Big Brother: Live
Was Pregnant 11pm Mystery ER: MARY, QUEEN OF SHOPS
HISTORY A woman who lost and regained BBC2, 9PM
7pm How the Earth Was Made the ability to speak. 12am
Mary Portas comes to the aid of a
8pm Skin Deep 9pm Battles BC Bringing Home the Babies 1am I
husband and wife running a Dorset
10pm Marked 11pm How the Didnt Know I Was Pregnant
2am Mystery ER 3am Jon and village shop who are losing almost
Earth Was Made 12am Battles 6,000 a month.
BC 1am Life After People 2am Kate Plus 8 4am Bringing Home
Lost Ships 3am Battle 360 4am- Baby 5am-6am Student
5am D-Days in the Pacific Midwives
DISCOVERY SKY1
8pm How Do They Do It? 7.30pm Futurama: Bender
8.30pm How Its Made 9pm becomes a wrestler. 8pm
Bear Grylls: Born Survivor 10pm Pineapple Dance Studios: The
Mystery Investigator: Olly Steeds competitive world of dancing.
11pm Im Alive 12am Deadliest 9pm The Girl Who Never Ate
Catch 1am Bear Grylls: Born 10pm NCIS: Los Angeles 11pm A
Survivor 2am How Do They Do League of Their Own 11.30pm CORONATION STREET
It? 2.30am How Its Made 3am Footballs Next Star 12.30am 24 ITV1, 7.30PM
Extreme Engineering 3.50am 1.30am Road Wars 3.30am Tru Nick makes plans to rebuild the
Man on Earth 4.40am The First Calling 4.20am Celebrity business in Turners, but Leanne has
World War 5.30am-6am How Parents SOS 4.45am Oops TV neglected to tell Peter of their
Does That Work? 5.10am-6am Sell Me the Answer agreement.

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

QUICK CROSSWORD
    

SUDOKU KAKURO
35 39 9 14 43 19 29
27 10
6  
16 9
Place the numbers from 1 to 9 in each empty cell so that each 12 
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 16 38
37
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 13 30
 
above or to the left of it. 24
You can only use the digits 1-9 19 19     
   and you must not use the
11 37
28  
same digit twice in a block. 15
     The same digit may occur 16 22 
13 29
  more than once in a row or
column, but it must be in a
28
7 23
15

23 4
  separate block.
8
20 34
  10 13
 

  ACROSS DOWN
1 Capital of 1 Senility (6)
 
     WORDWHEEL N A
Bangladesh (5)
4 Hirsute (5)
2 Leave without
permission (7)
Using only the letters in the Wordwheel, you have 7 Pastoral (7) 3 Farewell remark (5)
   ten minutes to nd as many words as possible,
N E 9 Item which prevents a 5 Joined by treaty or
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters A ship from moving (6) agreement (6)

LAST ISSUES or more, all must contain the central letter and
letters can only be used once in every word. There
G E 10 Harsh, stern (6) 6 Brings up (6)

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

M S
12 Sicilian volcano (4) 8 Put on clothes (7)
15 Work station (4) 11 Orbit (7)
QUICK CROSSWORD 1 3 4 2 1 7

. ( 1 < $ . $ % 8 /
4 5 3 1 9 2 8 SUDOKU         
17 Give notice (6) 13 Island in French
Polynesia, capital
6 9 8 7 6 9 5 8          19 Transfer abroad (6)
. $ , $ ,
2 4 3 1 3 2 1 Papeete (6)
/ ( * 6 6 1 2 5 ( 6         
$ + ( ( ' & 7 7 9 8 6 1 3
        
20 Antonio ___, Italian 14 Building where
6 ,
7
$ 0
5 $
& 0 2 3 (
/ / , ( ' 1
2
8
4 8 6 5
9 8 6
1 7 3
2 9
9
WORDWHEEL          composer (7) birds are kept (6)
6 $ 5 . 8 0 ( 5 (
3 1 8 2 3 9 3 The nine-letter words          21 African country, 16 Young cat (6)
7 , , ' / ( 5         
5 ( 9 ( 5 ( 1 $ * 6 1 2 5 4 3 4 2 1
were ALIENATOR and capital Tripoli (5)
$ $ , 7 $ 9 8 4 3 7 6 2          18 Goes out (5)
: $ / ( 6 * 2 2 6 ( 7 9 7 9 8 4 RATIONALE          22 Lustre (5)
 Sport
32
Geech hails underfire Johnno
RUGBY UNION
BRITISH Lions legend Sir Ian
McGeechan has backed underfire
England coach Martin Johnson,
insisting there should be no ques-
tion about his future.
Johnson came under critiscism as
England slumped to a 27-17 defeat to
Australia in the first Test in Perth on
Saturday.
With just eight wins from 22
Tests, Johnsons record is inferior to
that of previous coaches Brian
Ashton and Andy Robinson, but Scot
McGeechan, who took charge of
Johnson in two of his three stints as
Lions coach, believes the World Cup-
winning captain has been unlucky
with injuries and should be backed
by the Rugby Football Union. I dont
think there should be any question
I rate Martin very highly in that
regard and in that area with interna-
tional rugby, McGeechan said.
He hasnt had the best of luck at
times with injuries he had a lot of
injuries for the November interna-
tionals. I think it is a matter of know-
ing which are his real starting core
players, which I think Martin will be
trying to achieve now and in the
November series.
CANADIAN GP | RACE STANDINGS
1. Lewis Hamilton (McLaren) 1:33:53.456
2. Jenson Button (McLaren) +00:02
3. Fernando Alonso (Ferrari) +00.09
4. Sebastian Vettel (Red Bull) +00:37
5. Mark Webber (Red Bull) +00:56
6. Nico Rosberg (Mercedes) +00:57
Dutch have grown as a
team, insists veteran Gio
WORLD CUP
2010
BY JON COUCH
FORMER Arsenal defender Giovanni
van Bronckhorst believes Holland have
learned their lesson from their Euro
2008 campaign and are ready to mount
a strong World Cup charge.
The 35-year-old veteran wins his
100th cap for the Dutch against
Denmark in Johannesburg today and
says the team have grown from the dis-
appointment of two years ago where
they beat Italy and France in the group
stages, only to lose out to Russia in the
Cup chiefs ponder vuvuzela ban
WORLD CUP
BY JON COUCH
WORLD CUP organising chief Danny
Jordaan is considering calls to ban
vuvuzelas from the tournament follow-
ing complaints.
The trumpet-like instruments have
constantly droned through every match
of this World Cup so far, drowning out
singing and chanting from the fans.
Asked if it was a possibility that fans
could be prevented from bringing the
instruments into the stadiums,
Jordaan said: If there are grounds to
CITYA.M. 14 JUNE 2010
STANDINGS | DRIVERS CHAMPIONSHIP
1. Lewis Hamilton (GB) 109pts
2. Jenson Button (GB) 106pts
3. Mark Webber (Ger) 103pts
Hamilton and Button led McLaren to a
second successive one/two
Picture: ACTION IMAGES
quarter-finals.
We have to operate as a team, but
we also have the players who can win
games and we have grown as a team,
the Feyenoord full-back said. We have
to continue on that path for this World
Cup.
TODAYS MATCHES
Holland v Denmark
Johannesburg, ko 12.30pm, ITV1
Japan v Cameroon
Bloemfontein, ko 3pm, BBC1
Italy v Paraguay
Cape Town, ko 7.30pm, BBC1
do so, yes. We have heard from the
broadcasters and other individuals and
it is something we are evaluating on an
ongoing basis.
He added: We have tried to get some
order with it. We have asked for no
vuvuzelas during national anthems or
anyone is making an announcement.
I know it is a difficult question but
we are trying to manage it as best we
can.
The vuvuzela is said to be based on
an African kudu horn instrument and
became popular at South African
events during the 1990s.
CITYA.M. 14 JUNE 2010 33

Capellos 8.8m heads list of earners

Hamilton back Coasts former England chief, Sven- WORLD CUP | TOP EARNERS

FOOTBALL

on top after
BY JON COUCH
FABIO CAPELLO is alreay sitting on
top of the world in the high earn-
er stakes.
The England manager heads the
Goran Eriksson, trails in equal
ninth with a measly 1.2m by his 1 Fabio Capello (England) 8.8m
standards. 2 Marcello Lippi (Italy) 3m
Interestingly, Argentina boss
Diego Maradona is only equal 13th
3 Joachim Low (Germany) 2.5m
on the list with 800,000, along- 4 Lars Lagerback (Nigeria) 2m
5 Bert van Marwijk (Holland) 1.8m

Canadian win
list of the 32 World Cup bosses
with a salary of 8.8m almost
three times more than that of the
second-place manager, fellow
Italian Marcello Lippi.
Germanys Joachim Low comes
in next with 2.5m, while the Ivory
side Brazil counterpart Dunga and
the respective bosses of Japan and 6 Vicente del Bosque (Spain) 1.5m
New Zealand. 7 Carlos Queiroz (Portugal) 1.35m
But spare a thought for South 8 Carlos Parreira (S.Africa) 1.2m
Korean coach Kim Jong-Hun, wo 9 Sven G. Eriksson (I. Coast) 1.2m
props up the list with an annual 10 Pim Verbeek (Australia) 1.2m
salary of 170,000.

FORMULA 1 hands several times with tyre strategies

key. McLaren gambled at the start, tak-
2010 ing the softer Bridgestone, and it paid
BY JON COUCH off as pole-setter Hamilton held onto
his lead at the first corner
LEWIS HAMILTON returned to the top But it wasnt to last long as both
of the drivers championship for the McLarens came in, following swiftly by
first time in 18 months after leading a the Red Bull of Vettel, leaving the Toro
second successive McLaren one-two in a Rosso of Sebastien Buemi holding the
thrilling Canadian Grand Prix. lead for the first time in his career.
The 2008 champion put in a superb Hamilton then made his move to
drive to claim back-to-back wins and go reclaim the lead after Alonso failed in
three points clear of team-mate Jenson an attempt to pass Buemi, but after pit-
Button in the overall standings. ting against on lap 26, Alonso and then
Defending F1 champion Button him- Mark Webber led the way.
self secured second with a brilliant The Australian pulled out a lead of
pass of Fernando Alonso in the Ferrari 11.8 seconds at one point, but then his
on lap 56, but couldnt quite get close tyres began to go off and Hamilton and
enough to challenging Hamilton, who Alonso gave chase.
held on for a 14th career win. Hamilton eventually sneaked past on
Its been a tremendous weekend, lap 50 before Webber eventually pitted,
Hamilton said: Things have just gone and after Alonso began to tail away,
so well. Ive had incredible support, so Button saw his chance to take the
many Brits in the crowd, which is great Spaniard and seal a perfect weekend
to see. The race was one of the tightest for the McLarens.
so far, but the team did an incredible Its another one-two for the team,
job and Im so happy and proud of the Button summised. Id rather it was the
team. other way around, but Lewis put in a
In arguably the most exciting race of phenomenal lap yesterday in qualify-
the season so far, the lead changed ing that I couldnt touch.

SPORT | IN BRIEF
Sams the man at Queens Welcome win for Bjorn in Estoril
TENNIS: American Sam Querrey gave him- GOLF: Denmarks Thomas Bjorn shot a
self a pre-Wimbledon boost after beating closing round 68 to ease to victory in the
close friend and training partner Mardy Portuguese Open his first European Tour
Fish to win the Aegon Championship at success in four years.
Queens Club. Bjorn, 39, finished on 23-under-par in
The 6ft 6in Querrey, 28, used his big Estoril for a five-shot lead over playing
serve to full effect on the grass, coming partner Richard Green, of Australia.
through 7-6 (7-3), 7-5 against world No90 Englands Robert Rock was the highest-
Fish, conqueror of Andy Murray. placed Brit, finishing fourth on 14-under,
Its an honour, said the unseeded while Darren Clarkes best-of-the-day 66
Querrey, who claimed a fifth ATP Tour title saw him climb to sixth, two shots further
and first on grass. adrift.
All the greatest players in the world are It caps an incredible turn of form for
on this trophy. Its nice to be added to that Ryder Cup star Bjorn, who had just put an
list with them. end to a run of six successive missed cuts.

Results
WORLD CUP GROUP A GOLF
South Africa ..............(0) 1 Mexico.................................(0) 1
ESTORIL OPEN DE PORTUGAL (Penha Longa GC)FFinal rnd
Uruguay.........................(0) 0 France ..................................(0) 0
(Gbr & Irl unless stated, par 72): 265 Thomas Bjorn (Den) 67 65
GROUP B 65 68. 270 Richard Green (Aus) 67 69 64 70. 272 Mark F
Argentina......................(1) 1 Nigeria.................................(0) 0 Haastrup (Den) 67 68 70 67. 274 Robert Rock 68 67 68 71.
South Korea................(1) 2 Greece..................................(0) 0
MOTOR RACING
GROUP C
England...........................(1) 1 USA .........................................(1) 1 FIA FORMULA 1 CANADIAN GRAND PRIX (Montreal): 1 Lewis
Gerrard 4 Dempsey 40 Hamilton (Gbr) McLaren 1hr 33mins 53.456secs, 2 Jenson
Att: 44,026 Button (Gbr) McLaren 1:33:55.710, 3 Fernando Alonso (Spa)
Algeria ...........................(0) 0 Slovenia..............................(0) 1 Ferrari 1:34:02.670.
Att: 30,325 Koren 79 TENNIS
P W D L F A GD Pts
Slovenia 1 1 0 0 1 0 1 3 ATP AEGON CHSHIPS (London)FFinal: (7) Sam Querrey (USA)
England 1 0 1 0 1 1 0 1 bt Mardy Fish (USA) 7-6 (7-3) 7-5
USA 1 0 1 0 1 1 0 1 ATP GERRY WEBER OPEN (Halle, Germany)FFinal: (8) Lleyton
Algeria 1 0 0 1 0 1 -1 0
Hewitt (Aus) bt (1) Roger Federer (Swi) 3-6 7-6 (7-4) 6-4.
GROUP D
Germany .......................(2) 4 Australia ............................(0) 0 TODAYS DIARY
Podolski 8, Klose 27 World Cup Group E
Muller 68 Japan v Cameroon (3pm) ............................................................................................
Cacau 70 Att: 62,660 Holland v Denmark (12.30)..........................................................................................
Serbia .............................(0) 0 Ghana ...................................(0) 1 Group F
Att: 38,833 Gyan 84 (pen) Italy v Paraguay (7.30)..................................................................................................

SPORTS EDITOR JON COUCH

email sport@cityam.com
34 Sport
RACING TRADER BETTING EXPERT BILL
ESDAILE TAKES A LOOK AT CHAMPIONS ITALY,
WHO BEGIN THEIR DEFENCE AGAINST
PARAGUAY TONIGHT
ITALY are the world champions and are aim-
ing to become the first country to win back-
to-back World Cups since Brazil in 1962.
Marcello Lippi is still at the helm, but they
are an ageing side and confidence doesnt
seem too high at home.
They are still as short as 1/16 with
William Hill to qualify from Group F and 4/9
with the same firm to win the group.
Slovakia and New Zealand should be easy
wins, but todays fixture against Paraguay
looks much more difficult.
The South Americans have reached the last
16 in two of the last three tournaments and
their build-up this time hasnt been too bad.
They suffered a defeat in Dublin last
month, but have beaten Greece and drawn
against the Ivory Coast since then. Their
qualification was also strong, finishing joint
second with Chile, just one point behind
Brazil and five in front of Argentina.
Italy undoubtedly have better players
than Paraguay, but there is going to be a lot
of pressure on them in this opening game.
Lippi has received criticism from the nation-
al press for failing to usher in a new genera-
tion of player and their attacking options
look limited.
They have only scored three goals in their
last five friendlies, losing to Mexico and
drawing against both Cameroon and
Switzerland recently. Alberto Gilardino is the
only member of the squad to have scored
more than nine goals for his country (16
from 39 appearances), but he has only found
the net once in 14 outings for Fiorentina and
Italy since the turn of the year.
In fairness, Paraguays attack doesnt real-
ly inspire either. Roque Santa Cruz is their
top scorer with 21 goals from 67 caps, but
his season has been very stop-start with
Manchester City and he has also only netted
once this year from 15 appearances for his
club and country.
Im sure head coach Gerardo Martino
would be delighted if his side can take a
point from this game and everything points
to a tight, low-scoring game. The Sporting
Index traders seem to agree with me and
only have the Italians as 0.45-0.65 suprema-
cy favourites, with a goals spread of 2.1-2.3.
I honestly wouldnt be surprised if this
Green recovered from his first-half howler to make a crucial stop after the break.
game finishes goalless, so Ill be selling the
goals spread, as well as backing no goalscor-
Dropping Green will
er at a general 13/2.
POINTERS...
Match to be drawn at 9/4 with Paddy Power
No goalscorer at 13/2 general
Sell match goals at 2.1 with Sporting Index
ruin his confidence
EXPERT VIEW
RAY PARLOUR
A
S calamitous as Robert
Greens mistake was on
Saturday night, not playing
him for the second game
against Algeria on Friday night
would do more harm than good.
You really have to feel sorry for
Green. Mistakes like that dont hap-
pen too much in top-flight football,
but the way he held his hands up,
then kept his head to make that
crucial second half save, showed
guts.
Ive said all along that David
James should be the first-choice
keeper but I just feel that by not
playing Robert Green against the
Algerians you would be shattering
Im sorry, says
calamity keeper
WORLD CUP
2010
BY JON COUCH
ROBERT GREEN last night issued a
humbling apology to England play-
ers and supporters for his howler
against the USA on Saturday night.
The West Ham keeper fumbled
Clint Dempseys innocuous 25-yard
shot to hand the USA a share of the
spoils in Rustenburg on Saturday
night.
But he says the error will make
him doubly determined to make
amends should coach Fabio
Capello stick with him for the sec-
his confidence into a million pieces
to the point where he may not play
for England again.
My mind races back to Scott
Carson and that cold and wet qual-
ifier against Croatia in 2007. Here
was a good young keeper, thrown
into the deep end, but who has
never recovered from an error
which wasnt too dissimilar to
Greens on Saturday night.
Green is too good a goalkeeper to
let slip in such a way.
I think Fabio Capello will stick
with Robert Green for Friday. If not,
hes effectively out of the tourna-
ment. Its a tough decision, but
thats why hes paid 8.8m, to make
those decisions.
UNFATHOMABLE
Looking back, Saturday nights was
a strange game, not least for the
surprising decisions which Capello
made on the night.
Firstly, the decision to play
Milner, who had been sick all week,
missing three training sessions and
clearly not fit,
was baffling
ond group
stage game
a g a i n s t
Algeria on
Friday night.
G r e e n
explained: I walked in at half-
time, said sorry to the chaps and I
apologise to however many million
people at home as well.
But the important thing is you
are ready and I am willing to work
mentally on it. It's not a problem.
Ive done it before, Im 30 years old
and Ive learned to deal with these
things.
The manager has to answer
whether he will stick with me. Ill
CITYA.M. 14 JUNE 2010
Picture: ACTION IMAGES
enough, then to replace him with
Shaun Wright-Phillips in an uncus-
tomary left-sided position, and not
Joe Cole, was equally as unfath-
omable.
Joe has been Englands best play-
er for the last two warm-up games
and is that little bit wiser than
Wright-Phillips, while more com-
fortable on the left side.
But its Ledley Kings latest injury
which worries me the most. While
Jamie Carragher is a solid replace-
ment for King, he and John Terry
showed against the USA that they
are vulnerable to pace.
I wonder if Capello is taking a
sneaky look at Michael Dawson with
Friday in mind? Dawson has had a
great season at Tottenham and is
champing at the bit for a debut.
Gareth Barry looks to be ready
for Friday and I expect him to come
straight back into the side. I think
we missed Barry in that holding
role on Saturday and Capello, Im
sure, will be desperate to get that
shirt on his back.
be prepared, be ready and be pre-
pared just the same, wanting to
play. Im desperately keen to play, I
want to play every game I possibly
can. This is the biggest stage in the
world.
Green insists hes ready to undo
his mistake, adding: Ill be twice as
determined for this not to happen
again. Of course, this makes me
more determined to play next time
to right the wrong.
CITYA.M. 14 JUNE 2010 Sport | Football 35

Klose (No11) cele-

Slick Germans
brates his goal,
Germanys second,
with team-mates.

Pictures: ACTION
IMAGES

show intent
Bastian Schweinsteiger was a booking
GERMANY 4 at best. Joachim Lows side made their
intentions known early, Klose denied
by Aussie keeper Mark Schwarzer GROUP D
TEAM PLD W D L F A PTS
AUSTRALIA 0 before Podolski rifled in the opening
on 27 minutes after another sweeping Germany 1 1 0 0 4 0 3
attacking move. Ghana 1 1 0 0 1 0 3
WORLD CUP 2010 Klose didnt have to wait long to net
his 11th goal in World Cup finals, head- Serbia 1 0 0 1 0 1 0
BY JON COUCH ing home Philipp Lahms cross before Australia 1 0 0 1 0 4 0
WHO was it who warned never to write star man Mesut Ozil missed a one-on-
off the Germans? one chance his invention deserved.
Despite the absence of the injured If the match wasnt yet ended as a
Michael Ballack, the three-time cham- contest, Cahills red card certainly did,
pions made light of their mediocre tag and the Germans exploited the extra
to give a real signal of intent in Durban space to great effect.
last night. Mueller rifled home a third off the
Lukas Podolski and Miroslav Klose post before Brazilian-born substitute
continued their remarkable scoring Cacau netted his first goal for his
records with a goal apiece before adopted country, tapping in from
Thomas Mueller and Cacau wrapped Ozils centre.
up the most impressive performance of For Australia, it was a long night, but
this World Cup so far. the Socceroos almost carved out a late
They were however, helped by the consolation they scarcely deserved
harsh 55th-minute sending off of substitute Nikita Rukavytsya volleying
Evertons Tim Cahill, whose tackle of straight at keeper Manuel Neuer.

Spot-on Gyan sends

Ghana off to a flier
reduced to ten men after defender
SERBIA 0 Aleksandar Lukovic was handed a sec-
ond yellow card.
Ghana, four-time African champi-
GHANA 1 ons, are managed by Milovan Rajevac,
a Serb, and were well worthy of their

WORLD CUP 2010

BY JON COUCH
A PENALTY five minutes from time
from Asamoah Gyan handed Ghana a
winning start to their Group D cam-
paign against ten-man Serbia.
The Rennes striker rifled home
from the spot after Serbian substitute
Zdravko Kuzmanovic handled when
attempting to head clear a cross.
It came 11 minutes after the
Serbians, many peoples dark horses
to do well in South Africa, were
victory having dominated long spells.
Indeed, had Gyan, John Mensah and Exclusive football content on Yahoo!
Andre Ayew converted their chances,
they would have won by more. Serbia From a man who knows a bit about football.
posed little attacking threat, although
Aleksander Kolarov went close with a
free-kick which curled flew wide.
Lukovics sending off for holding
back Gyan on the halfway line put
paid to Serbias hopes, before Gyan
made his sides pressure tell with the
decisive penalty. He then went close
to adding a second when striking a
post with a curling shot in injury
time.

Dire affair will give Fabio

much-needed light relief
finals victory with a dipping 20-yard
ALGERIA 0 volley, which slipped through the
grasp of Algeria keeper Faouzi
Chaouchi.
SLOVENIA 1 The goal came seven minutes after
Algerian substitute Abdelkader
Ghezzal was sent off for two bookable
WORLD CUP 2010 offences, but was the only highlight
of a disappointing contest between
BY JON COUCH
two poor sides.
IF Fabio Capello was feeling a touch
disheartened after Saturdays nights
solitary point in Rustenburg, he will GROUP C
have had every reason to be cheered TEAM PLD W D L F A PTS
by this dire affair between the other Slovenia 1 1 0 0 1 0 3
two sides in Englands group.
England 1 0 1 0 1 1 1 Make Yahoo! your home for football.
West Broms Robert Koren settled
the match on 79 minutes and gave his USA 1 0 1 0 1 1 1 yahoo.co.uk
country their first-ever World Cup Algeria 1 0 0 1 0 1 0