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0203 405 1000 BUSINESS WITH PERSONALITY JOE LEWIS WHAT MBA CLASSES CHASES M&B SUITOR HOPES TO LEARN FROM LADY GAGA IMPRESS TYCOON BUSINESS EDUCATION P26-28 INVESTORS P7 Issue 1,468 Thursday 15 September 2011 www.cityam.com FREE Euro banks THE GLOVES ARE scramble for funding

▲ EUROZONE OFF: UK SUES ECB BY JULIET SAMUEL TWO unnamed banks tapped the ▲ POLITICS ECB’s weekly dollar funding facility for BY DAVID CROW the second time in a month yesterday in a fresh sign that Europe’s interbank BRITAIN will today sue the European markets are freezing up. Central Bank (ECB) over new rules that The escalating crisis has seen bor- will force the City’s biggest clearing rowing costs rise for banks, forcing house, LCH.Clearnet, to relocate to the weaker lenders to tap the emergency Eurozone. cash supply to the tune of $575m The move highlights growing impa- (£364.6m). That follows a one-time use tience among Whitehall officials and of the facility by one bank in August, politicians, who believe Brussels is which borrowed $500m. using new regulation as a smoke- A bank would only draw on ECB screen to undermine London’s pre- funding if it were frozen out of the eminence as a global financial centre. open market, where borrowing costs Under new rules unveiled by the are much lower than the 1.1 per cent ECB in July, clearing houses must be rate the Bank demands. based in the Eurozone if they hold Moody’s yesterday downgraded two more than five per cent of any one French banks, Credit Agricole and euro-denominated market, including Société Générale, but they have denied over-the-counter (OTC) derivatives. any funding problems. London is home to around 40 per cent The average rate banks are charged of OTC derivate trading. for loans in sterling, euro and dollars is Such a rule would force on the rise. The three-month dollar LCH.Clearnet – one of the largest clear- London interbank offered rate (Libor) ing houses in the world – to relocate Chancellor George Osborne is taking the ECB, headed up by Jean Claude-Trichet, to court Picture: REX increased from 0.347 per cent on huge parts of its business to a financial Tuesday to 0.349 per cent yesterday, centre within the Eurozone, such as “This sets a dangerous precedent and single market, the unprecedented and fundamental single market prin- with Credit Suisse and Credit Agricole Paris or Frankfurt, costing hundreds of has serious implications for the City’s move represents part of a wider ciples by preventing the clearing of charged the most at 0.415 per cent. London jobs. competitiveness. The general feeling is assault against the deluge of anti-City some financial products outside the Three-month euro rates also According to the ECB policy paper, that this is our ‘enough’s enough’ regulation that is coming out of Euro area. That is why we have begun increased, from 1.4781 per cent to clearing houses that exceed the five moment.” Brussels. proceedings against the ECB through 1.4787 per cent and the equivalent per cent threshold must be “legally Britain is expected to file the lawsuit Some officials fear that France and the ECJ. sterling rate rose from 0.912 per cent incorporated in the euro area with full today at the European Court of Justice Germany are trying to win business “[We] want to see this resolved swift- to 0.915 per cent. managerial and operational control (ECJ), marking the first time a member for their own financial centres by ly and without involving the courts, And IFR magazine has reported that and responsibility over all core func- state has taken legal proceedings changing the regulatory goal-posts in but if necessary will not shy away from US banks are stepping into the fund- tions exercised from within the euro against the ECB. the name of financial stability. continuing legal action to make sure ing breach, signing deals to lend bil- area”. Although Britain will fight the case A Treasury spokesman said: “This there is a level playing field across the lions to European lenders over the One Whitehall official told City A.M.: on the grounds that it undermines the decision contravenes European law EU for British businesses.” summer. MORE: P3, P24

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20th, 22nd, & 28th of September 1PM - 3PM 0203 405 1000 Saturday 24th September 11AM - 1PM .com Call to reserve your seat now on: 0203 405 1000 Home of the New Turtle Traders 2 News CITYA.M. 15 SEPTEMBER 2011 Economy not rebalancing fast enough NEWS | IN BRIEF Lehman Bros bonus case fails A bankruptcy judge has denied Lehman Brothers Holdings’ attempt to recover boom-time peak, a devastating blow in late 2009, hitting 21.9 per cent on banks, total pay in the public sector $500m (£317m) it alleges was supposed but still less than expected after a the official measure; payrolls reached rose by 1.6 per cent on a year earlier to go toward employee bonuses from recession of such severity. One reason 6.327m at the end of 2009. They then (against 3.1 per cent in the private sec- Barclays. Lehman had said Barclays was that public spending, including in started to fall when Labour was still in tor). Because the public sector is failing never gave the money to the employees construction, propped up technically power – a decline that has since accel- to keep wage costs down, far more peo- and should send it back to Lehman for “private” but in fact state-funded jobs erated – and dropped to 6.037m in the ple will have to lose their jobs. the benefit of Lehman's creditors. (a major trend during the Labour second quarter, 20.7 per cent of the All of which put the onus back on Wednesday's ruling is the latest instance years, when hundreds of thousands of total. So far, therefore, total state sector the private sector. It is a miracle, given of validation for Barclays, which bought EDITOR’S LETTER “private” jobs dependent on govern- jobs are down by 290,000, through a that national insurance (aka the jobs Lehman’s North American business in ment contracts were created). combination of non-replacement and tax) has been hiked, that the coalition 2008 following the collapse of the firm. ALLISTER HEATH Firms started to add to their staffing redundancies – but even then we are has utterly failed to deregulate the levels at the start of 2010. Private sector still only just back to levels last seen in economy in any meaningful way, the HSBC dropped from silver probe IT is not good news on the jobs front. employment has grown during each of 2008. The most recent three months job cuts in the City, and that vast num- HSBC has for now been dropped from Unemployment jumped by 80,000 over the past six quarters, with a net were unusual in that total public sec- bers more rules have actually hit an investor lawsuit accusing it of con- the past three months; employment is 617,000 jobs added, taking the total tor job losses (111,000) swamped pri- employers in recent months, that the spiring to drive down silver prices, leav- up by just 24,000 over the past year. back to 23.132m. But the strong vate sector growth (41,000). situation isn’t worse. ing JP Morgan Chase as the only bank The post-recession jobs rebound has growth of previous quarters is now The rate of job losses in the public With the Eurozone in crisis and UK defendant in the case. Investors had in a ground to a halt. The economy is rebal- running out of steam. One reason for sector appears to be running 3-4 times inflation hitting real incomes, growth raft of complaints filed in 2010 and ancing towards the private sector but this is the loss of state-supported jobs; faster than predicted by the Office for will remain depressed. The only way 2011 accused banks of amassing hun- no longer quickly enough. but the main factor is that the econo- Budget Responsibility. Either George the coalition can possibly incentivise dreds of millions of dollars in illegal prof- Private sector employment peaked my grew by just 0.2 per cent in the sec- Osborne is getting the painful news UK Plc to create more jobs under such it by manipulating prices of COMEX at 23.542m during the first quarter of ond quarter, which is just too weak to out of the way – or the overall reduc- conditions is to transform the business silver futures and options contracts. But 2008. Interestingly, private jobs started create enough jobs. tions will end up being higher than climate by introducing radical deregu- an amended complaint in the US courts to fall long before Northern Rock. The What was more surprising was the planned. One reason to suspect the lat- latory measures. It is the only hope; yesterday said HSBC had entered into a trough came in the final quarter of acceleration in the rate of public sector ter is that the supposed pay freeze in Osborne must act urgently. “tolling agreement” with claimants, 2009, when private sector employment jobs losses. Public sector employment the public sector is not happening: [email protected] without giving a reason why, and that fell to 22.515m, down 1.027m from the reached its peak as a share of total jobs even excluding the nationalised Follow me on Twitter: @allisterheath they were no longer a defendant.

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Editorial Editor Allister Heath Deputy Editor David Hellier blame for spill News Editor David Crow Acting Night Editor Marion Dakers Business Features Editor Marc Sidwell Lifestyle Editor Zoe Strimpel ▲ ENERGY led to the failure of the cementing of Sports Editor Frank Dalleres BY KASMIRA JEFFORD the well. Irish regulators will examine Ernst & Young, led in the UK and Ireland by Steve Varley Art Director Craig Gaymer The explosion aboard the Pictures Alice Hepple AN OFFICIAL US government report Deepwater Horizon killed 11 people Commercial has heaped most of blame for the and caused almost 5m barrels of oil to Sales Director Jeremy Slattery country’s biggest ever oil spill on BP leak into the Gulf of Mexico. E&Y to face Irish probe Commercial Director Harry Owen yesterday, chastising the company and BP’s shares rose as much as 4.8 per Head of Distribution Nick Owen other parties for poor management cent before the report was published and a string of critical mistakes that on hopes that it would help the com- could have been prevented. pany avoid being found grossly negli- ▲ FINANCIAL SERVICES ing operations. Distribution helpline “BP’s cost or time saving decisions gent, which would increase its In particular, the regulator will If you have any comments about the distribution BY JULIET SAMUEL of City A.M. Please ring 0207 015 1230, or email without considering contingencies financial liabilities. The shares fell look into E&Y’s work on the lender’s [email protected] and mitigation” were “contributing back slightly but still closed 3.5 per ACCOUNTANCY giant Ernst & Young 2008 accounts regarding its dealing causes” of the Macondo blowout in cent higher as the report implicated is to face an investigation into its with Irish Life & Permanent. Editorial Statement April last year, a final enquiry by the other parties. alleged failure to audit the accounts Both Anglo Irish and IL&P were This newspaper adheres to the system of US Coast Guard and the offshore oil of Anglo Irish Bank properly in the bailed out by the Irish government, self-regulation overseen by the Press Complaints regulator concluded. BP, led by Bob Dudley run-up to the financial crisis. which expects to make a loss of some Commission. The PCC takes complaints about the The 17-month enquiry also finds The Irish Chartered Accountants €38bn on the Anglo Irish rescue editorial content of publications under the Editor’s said it agreed the spill Code of Practice, a copy of which can be found at fault with rig owner Transocean and “was a result of multiple Regulatory Board (CARB) reported alone. www.pcc.org.uk contractor Halliburton for their part causes involving multiple yesterday that it has found enough Dublin’s decision to guarantee its Printed by Newsfax International, in the catastrophe but concludes BP evidence to justify a probe into banks’ mountain of debt was instru- Beam Reach 5 Business Park, was ultimately responsible for making parties”. E&Y’s role regarding the bank’s dis- mental in forcing the state to seek a Marsh Way, Rainham, Essex, RM13 8RS a series of decisions which ultimately closure of certain loans and financ- bailout last year. WHAT THE OTHER PAPERS SAY THIS MORNING

BARCAP NEARS £1BN DEAL FOR STUDENT HOMES STAKE Barclays Capital is close to selling its DEUTSCHE BÖRSE-NYSE DEAL TO SAVE majority stake in University MCLAREN’S FORMULA ADDED TO IMF: EUROPE NEEDS TO TAKE DECISIVE THAT IPO POP? MAJORITY OF 2011 US EXTRA $1BN FOR CUSTOMERS Partnerships Programme, the UK’s LUCOZADE, DRUGS AND EDUCATION ACTION NOW ON BANKING CRISIS LISTINGS ARE UNDERWATER Deutsche Börse and NYSE Euronext, largest developer of university campus- McLaren’s expertise in building The International Monetary Fund More than half of the US-based com- the exchange operators planning to es, in a deal that could be worth close Formula One cars is to be put to use (IMF) has issued its starkest warning to panies making their domestic stock- create the world’s largest bourse, have to £1bn. PGGM, the Dutch pension in the manufacture of antibiotics, date that Europe’s banking debacle is market debuts this year are trading significantly raised their estimate of fund, has entered exclusive negotia- vaccines and Lucozade in an unlikely turning into a systemic threat to glob- below their offer price, an ominous savings by banks from the deal, saying tions with UPP and is likely to sign a alliance between the motor racing al finance and can no longer be backdrop for any companies hoping customers would save about $1bn deal early next month to buy the bulk team and GlaxoSmithKline. The two allowed to fester. “This is the most to come public. For any investor who more than previously estimated. of the 80 per cent stake controlled by companies are to spend between urgent crisis facing the world today,” bought – and held – these so-called BarCap’s infrastructure fund. £25m and £30m on a technical centre said Zhu Min, the IMF’s deputy man- underwater stocks in their portfolios VICKERS MEMBER CALLS FOR REPEAL OF in Woking that will pool analytical aging director and China's voice at the over the course of the year, it is a BANK LEVY HAPAG-LLOYD IPO BLOCKED BY SPLIT tools. institution. painful reminder that even deals that An influential member of the Vickers AMONG SHAREHOLDERS did well their first day in the spot- commission on banking reform has The general manager of the consor- PLYMOUTH MARINA CHIEF BOWS TO IPPR: THE BLOATED SCOTTISH PUBLIC light can crater later. urged the government to offset the tium that owns a majority of Hapag- INVESTOR PRESSURE SECTOR WILL HAMPER RECOVERY potential £7bn-a-year hit to the indus- Lloyd, one of the world’s largest The chief executive of Plymouth’s Economic recovery in Scotland will GOP TIES HOUSE WINS TO try from implementing the report’s container shipping lines, has ruled out marina and airport stepped down yes- lag behind most of the UK because it PRESIDENT’S WOES recommendations, by axing the annu- a €3bn ($4.1bn) initial public offering terday in the aftermath of an investor has become so reliant on an unafford- Decisive Republican wins Tuesday in al £2.5bn balance sheet levy. Bill in the next 12-15 months. Karl revolt. Sutton Harbour Group, which able public sector, a think tank study two House races have Democrats Winters said any concerns that the Gernandt, chief executive of Kuehne also owns the dock that services has concluded. The Institute for Public increasingly worried they will face Vickers recommendations would Holding, a member of the Albert Plymouth’s fishing fleet, said that Policy Research (IPPR) said the SNP problems in the 2012 elections if the make British banks uncompetitive Ballin consortium that controls 62 per Nigel Godefroy had resigned after 19 administration must oversee a economy and President Barack against foreign-owned rivals could be cent of Hapag-Lloyd, said the IPO had years at the company for “personal “marked turnaround” in the creation Obama's job approval rating don't softened by tax cuts. been held up by differences of opinion. reasons”. of private sector jobs. improve significantly. CITYA.M. 15 SEPTEMBER 2011 News 3 BNP Paribas avoids Moody’s downgrade of French banks

▲ BANKING restructuring that will see the bank cent reduction in the group’s leverage BY JULIET SAMUEL offload €70bn of assets. ratio, Prot said. He aims to boost the MOODY’s downgraded Credit In a conference presentation in New bank’s common tier one equity ratio Agricole and Société Générale – two York, the bank’s chief executive by one per cent compared to June of of France’s biggest lenders – yesterday Baudouin Prot also outlined plans – this year. on the basis of Credit Agricole’s expo- some already in motion – to shrink its He claimed that the bank is on track sure to Greece’s ailing public finances investment bank’s funding needs by to meet its target of a nine per cent and SocGen’s reliance on wholesale €60bn by the end of next year and to common equity ratio under Basel III funding. exit the UK, Hungary and Switzerland. definitions by the end of 2012. But BNP Paribas avoided a down- The sell-off, which will also include The bank emphasised that it has so grade and fought back against its crit- non-core assets like yacht and jets-leas- far reduced its investment bank’s fund- Jose Manuel Barroso said that the Eurozone must fight for its life ics by unveiling a dramatic ing businesses, will deliver a ten per ing needs by €22bn since June 2010. Markets rally after promise of euro-bond

▲ EUROZONE There were reports that the EU is BY JULIET SAMUEL preparing for disaster behind the MARKETS rallied yesterday after scenes. A leaked document written by European Commission president Jose EU officials was quoted as saying that Manuel Barroso promised to unveil over the summer, “contagion has new proposals for euro-bonds in the spread across markets and countries near future. and the crisis has become systemic”. Speaking to the European And the statement is unlikely to Parliament, he said: “This is a fight for impress markets. Yesterday morning the economic and political future of Newedge’s Bill Blain warned against Europe. This is a fight for European further “euro elite platitudes”, saying: integration itself.” “We don’t need more circular chitter- A euro-bond would effectively see chatter, plans about plans, or panic paymaster economies agree to under- about electoral implications… We write the debts of weaker countries. have reached the ‘do something’ In the evening the region’s leaders moment.” tried to affirm their support for That moment could still be far off, Greece’s membership of the euro. however: despite the Eurostoxx 50 Following a conference call and the FTSE 100 both closing up, between Prime Minister George stocks dipped during the day after an Papandreou, French President Nicolas Austrian parliamentary committee Sarkozy and German Chancellor refused to fast-track a vote on expand- Angela Merkel, Athens released a ing Europe’s bailout facility. statement that said: “Greece is an The current schedule could see the integral part of the Eurozone... Greece region wait until December to fully is determined to meet all its commit- ratify Greece’s second bailout. But at ments to its partners.” the moment, markets are more con- Merkel had previously warned that cerned about Athens staying on track politicians must weigh their words with its austerity targets to continue “carefully”, a slap-down to her coali- receiving instalments of its first tion partner who has talked publicly bailout. about preparing for a Greek default. MORE ON THE EURO: P24 Facebook could delay $60bn float to second half of 2012

▲ TECHNOLOGY employees becoming distracted by the prospect of a pay-out from their FACEBOOK will delay its initial pub- share options, according to the FT. lic offering (IPO) until the end of The decision was said to be unre- next year so employees can focus on lated to market conditions. developing products for the social The world’s most popular social networking website, according to networking site is being advised by reports. Goldman Sachs, which is also a Facebook, which is expected to major investor in the company, valu- have one of the biggest IPOs in histo- ing it at around $60bn– similar to ry, plans to go public at the end of the value at which commodities 2012, a later public debut than it trader Glencore floated earlier this originally planned. The float had year. been scheduled for April, with some Facebook’s revenue is said to suggesting it could even be this year. have doubled to $1.6bn in the first Chief executive Mark Zuckerberg half of this year. The firm declined is said to want to delay an IPO until to comment on its float plans last September or later in 2012 to avoid night. 4 News CITYA.M. 15 SEPTEMBER 2011

Barack Obama faces a fight to steer US retail growth grinds to halt the US back into strong economic growth in August after slow summer Picture: REUTERS

▲ Sales of vehicles and clothing led per cent higher than in the same US ECONOMY the fall, declining by 0.3 per cent and period of 2010, but a slow increase in BY TIM WALLACE 0.7 per cent respectively over the business inventories – up 0.4 per month. Electronics and sports goods cent in July, according to figures HURRICANE Irene and low confi- helped offset that, however, with from the Commerce Department dence made retail and food sales sales increasing by 0.5 per cent and released yesterday – indicates firms stagnate last month, according to 2.4 per cent in turn. are cautious about future demand. figures released yesterday by the US Economists believe sales post- The Producer Price Index (PPI) Census Bureau. poned by the hurricane and a build- measure of inflation was also static, Advanced estimates indicate over- ing expansion prompted by showing no change overall in all sales did not grow at all during increased repair works will con- August. Food prices rose 1.1 per cent August, compared to monthly tribute to third quarter sales exceed- over the month while energy growth of 0.3 per cent and 0.2 per ing those in the second quarter. declined by an almost identical one cent in July and June respectively. Over the year so far sales are 7.9 per cent. Public sector jobs slashed at record rate

▲ the scale of the challenge we face par- ECONOMY ticularly given slower growth across BY TIM WALLACE Europe and North America”. Grayling pointed to measures NEW jobs in the private sector failed including the creation of “enterprise to offset major declines in state sector zones”, expected to create 30,000 jobs employment in the second quarter of by 2015, and steps to cut tax and red the year, figures from the Office for tape on companies as evidence of gov- National Statistics (ONS) revealed yes- ernment action on unemployment. terday. An extra 30,000 people claimed job- With chancellor George Osborne’s seekers’ allowance in August than in austerity plans beginning to kick in, the month before, a lower increase government roles were down by than analysts predicted. 111,000 in the three months to June -- “We anticipated a rise in the the largest fall in state employment claimant count of 40,000,” said since the records began in 1999 -- Investec’s Victoria Cadman. “Despite while the commercial sector created the smaller rise, the UK’s recovery 41,000 new jobs. prospects look to be negative.” Not all of the public sector job loss- The number of people in employ- es were unexpected, however – 14,000 ment also sunk in the three months were staff employed on a temporary to July, down by 69,000 compared to basis to work on the census. the previous three months. And over six million people are still Long-term unemployment employed by the state, despite 240,000 increased as well, with 849,000 people positions being cut in the last 12 now out of work for over 12 months – months. In the same period, 264,000 51,000 more than in the previous jobs have been created in the private three months. sector. “The government is taking the steps Yet figures for the three months to needed to support growth and rebal- July show unemployment increased ance the economy,” said Grayling. In Live nüLink! 2320 | 2340 | 2390 by 80,000 to 2.51m compared with the terms of the long-term jobless, “our previous three months -- a rise of 0.2 new Work Programme is now up and percentage points to 7.9 per cent and running across the country and will the largest spike in almost two years. offer flexible support tailored to peo- Employment minister Chris ple’s needs to help them get into NEXT LEFT: Grayling said the figures “underline employment.” CHEAPEST FUEL Financial services roles remain at Save money with LIVE Fuel Prices on a nüLink sat nav. a premium as hiring levels slump Compare fuel prices in your area, select the cheapest

or nearest, tap go and it will take you there. ▲ RECRUITMENT when 5,544 jobs were available, claim figures from Morgan McKinley. garmin.co.uk/nulink HIRING for financial services roles in Between July and August, the num- London fell to its lowest point so far ber of new job seekers in the financial this year during August, with just services market rose by 17 per cent – a 4,095 vacancies compared to the five per cent decrease on the same 10,291 job seekers that entered the time last year. market, a report said yesterday. But for those who did manage to Live nüLink services are included for one year; Live 3D Traffic includes a free 30-day trial of PhotoLive cameras; New opportunities in the financial secure a role during August there was some apps such as fuel prices require subscription fee; terms and conditions apply. sector fell 18 per cent month-on- at least some good news, as average month from July, and were down a salaries for new employees rose by huge 26 per cent since August 2010, three per cent from July.

6 News CITYA.M. 15 SEPTEMBER 2011 Tower 42 put Moody’s: UK up for sale for bank ratings by PE owners ▲ PROPERTY CITY landmark Tower 42, an icon of the London skyline since it was safe for now completed in 1980, has been put up for sale, with its private equity own- ers hoping to get £290m for the building on Bishopsgate. ▲ BANKING The ICB also insisted banks hold BlackRock UK Property Fund and BY HARRY BANKS core capital of at least 10 per cent of LaSalle Investment Management risk-weighted assets in their domestic yesterday announced they were CREDIT rating agency Moody’s said retail operations. looking for buyers of their freehold proposals from the Independent They will have to hold a further in the Tower 42 estate, which Commission on Banking (ICB) to ring- seven to 10 per cent of capital that can includes five other commercial fence the retail operations of UK be in the form of “bail-in” bonds -- buildings around Old Broad Street. banks and get them to hold more cap- which take a loss or convert into equi- “With limited supply and ital would not lead to any immediate ty to recapitalise a bank if it hits trou- increasing demand exerting rating changes on the sector. ble -- giving a requirement they hold a upward pressure on rents in the Moody’s said, however, that the total of primary loss-absorbing capital City market, investors can antici- ICB’s proposals would have a negative of between 17 and 20 per cent, a level pate strong returns and consider- impact in the longer-term for British only the Swiss also plan to introduce. able long term growth potential,” banks’ bondholders. “The final report published by the said BlackRock managing director Earlier this week, the ICB -- which ICB will not trigger any immediate rat- Jeff Morton. submitted its final report to the gov- ing changes for UK banks,” Elisabeth The flagship tower, which stands ernment earlier this week -- said top Rudman, senior vice president in over 600 feet tall, was built between UK banks should insulate their retail Moody’s Financial Institutions Group 1971 and 1980 as the new head- lending activities and store up billions in London, said in a statement. quarters for NatWest bank, and cost in extra capital. around £70m to build at the time. The proposals will impose a ring- FAST FACTS | VICKERS REPORT It was previously put on the mar- fence limiting the extent to which a ket last year with a target price of bank can use money in its retail arm ● The ICB estimates the cost of its proposals at £300m by BlackRock and LaSalle. to fund investment banking activities, £4-7bn a year for the banking industry. Despite more than 40 serious view- thus increasing its funding costs, ● It says half of the cost will be down to the ring- ings, reported to include property which will likely hit profits and possi- fence requirement and half due to a rise in funding tycoon Gerald Ronson, the owners bly make it harder for banks to lend to costs due to the introduction of bail-in bonds. decided to hold out for a higher businesses. Tower 42, once the City’s tallest building, has been put up for sale Picture: REX offer. CITYA.M. 15 SEPTEMBER 2011 News 7 Lewis seeks out Irish tycoons in brewing battle

▲ LEISURE Life, which has spoken out against the possible bid, to reject a low-ball offer. BY DAVID HELLIER AND HARRIET DENNYS Magnier and McManus have in the JOE LEWIS has told associates he past denied they have been acting wants to meet JP McManus and John together with respect to their share- Magnier, his friends and fellow share- holdings in M&B – a view accepted by holders in Mitchells & Butlers, to the Takeover Panel, which in January enlist their support in his fight to 2010 defended the pair from accusa- M&B suitor Joe Lewis (left) hopes to meet with JP McManus (right) and John Magnier to discuss a bid Picture: NEWSCAST take full control of the pub chain. tions they were trying to take control According to one source who was of the Harvester and All Bar One yesterday at a meeting on Lewis’s boat owner without making a formal bid. Aviva, the financier expressed his But one source told City A.M. that wish to meet McManus and Magnier Magnier and McManus both enjoyed “within 48 hours”. hospitality aboard Aviva over the JAZZ 1.2 S MANUAL However, an adviser representing summer, reportedly joining Lewis on WITH METALLIC PAINT Lewis’s vehicle Piedmont stressed no the superyacht for games of cards. £11,735 such meeting between the two par- Bankers have speculated that ties had yet been scheduled. Lewis, whose Piedmont vehicle Investors in M&B are concerned a announced a possible 230p per share joint approach from Lewis and the offer for M&B on Monday, could offer Irish tycoons – who own 22.8 per cent a more or less equal shareholding in and 20 per cent of the leisure group the new company to the two Irish respectively – could make it difficult investors if they decide to join his bid for shareholders such as Standard plans.

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CITYA.M. 15 SEPTEMBER 2011 News 9 Clegg under fire after calls for infrastucture spending

▲ UK ECONOMY Littlewood from the Institute of in-one out’ system for new regulations Economic Affairs (IEA). “What we need would help, as would a renewed BY TIM WALLACE is a major programme of deregula- emphasis on science, technology, engi- DEPUTY Prime Minister Nick Clegg’s tion, making it easier for private busi- neering and maths qualifications.” proposals to boost the economy by pri- ness to flourish.” Tony Dolphin from the Institute for oritising infrastructure spending were The IEA is calling for the minimum Public Policy Research criticised the rejected by several economists and wage to be suspended and a more rad- government’s fiscal position: “By business leaders yesterday. ical liberalisation of planning laws. repeatedly saying ‘there is no plan B Clegg’s plans for speeding up spend- Steve Radley from manufacturers’ on spending’ the government has pre- ing on projects like Crossrail and organisation EEF added: “The most vented itself even from simply bring- TUC general secretary Brendan Barber warned of a wave of industrial action boosting the M25’s capacity “will not pressing areas to address are tax, ing next year’s infrastructure bring about growth,” warned Mark finance, regulation and skills. A ‘one- spending forward.” Unions plot more pension strike action

▲ POLITICS trying to negotiate a compromise BY MARION DAKERS since the details were laid out in Lord Hutton’s report in March. BRITISH unions yesterday gave notice TUC general secretary Brendan that up to a quarter of the country’s Barber warned that a day of strikes in workforce could go on strike in November could mark the start of a November in protest at the govern- wave of industrial action over the ment’s public sector pensions reform. winter if a deal is not reached. The Trades Union Congress, a “The intention will be to take the group of unions that represent 6.5m call for pensions justice for both pub- workers, voted unanimously in lic and private sector workers to every favour of industrial action yesterday. corner of the land on that day in the Leaders chose the 30 November as the biggest trade union mobilisation in a planned date for coordinated action generation,” he said. at a meeting at the TUC conference in Cabinet Office minister Francis London. Maude said the government hopes to Unite, the Fire Brigades’ Union and come to an agreement without the the GMB have already started ballot- need for strikes. ing members over strike action in “It is extremely disappointing that response to the planned rise in pen- the TUC is calling on union members sion contributions from those who to lose a day’s pay and go on strike work for the state. while serious talks, which were set up Even Unison, which represents at their request, are very much still 1.1m workers and decided not to take ongoing,” he said. part in June’s one-day strike, said it Labour shadow Treasury minister will ask members to vote on industri- Angela Eagle called on the govern- al action. ment to step up talks to avoid any The government is seeking to raise industrial action. “I urge all sides to contributions by three per cent from step back from a confrontation that April next year to save more than will further harm the economy and £1bn in 2012-2013. make life tougher still for millions of Unions and ministers have been British families,” she said. Clarke challenges EU on plans for a unified European contract law

▲ LEGAL SERVICES expand into new markets, with India – which bans foreign law firms JUSTICE secretary Ken Clarke yester- and lawyers from practising in its day poured scorn on EU plans to har- markets – singled out as a key target monise contract law across Europe, for investment. calling the initiative “unnecessary, He also reiterated the importance disproportionate and damaging”. of the new Legal Services Act, which In a wide-ranging speech, during will liberalise the way UK law firms which he outlined an “action plan” can be run when it is introduced to promote UK legal services across later this year. the globe, Clarke said efforts to “I want to make it clear that for establish a unified law across the sin- this government, the City of London gle market would tie up the EC from is a legal centre – not just a financial doing useful work elsewhere, and one,” said Clarke. could prompt “years of litigation as “The rule of law is one of our the new law gets tested”. greatest exports but there is more Clarke also outlined his commit- that we can do to help UK legal serv- ment to helping UK legal services ices thrive.” 10 EDITED BY CITYA.M. 15 SEPTEMBER 2011 HARRIET DENNYS Got A Story? Email [email protected] The Capitalist Follow The Capitalist on Twitter: @citycapitalist PUBS WAR CAN WAIT AS JOE LEWIS EXPECTS NEW GREAT-GRANDCHILD

ALL EYES remain on financier Joe a business associate source, is that “He could have done that business Lewis, whose surprise appearance in the 74-year-old is expecting the arrival from anywhere in the world.” London on his superyacht Aviva ten of his first great-grandchild. Such as the New Providence days ago has been satisfactorily Lewis’s boat has now moved from marina in the Bahamas, Aviva’s explained by this week’s hostile move Tower Bridge to the Tower of usual mooring place and the site of to take control of pub chain Mitchells London, says The Capitalist’s man on the Albany resort, which Lewis has & Butlers. Case closed. the riverbank, and there it will been quietly developing through Or is it? As ever with the enigmatic remain until the latest addition to his Tavistock Group business inter- Bahamas-based billionaire, the truth the Lewis gene pool has been safely est alongside golfing investors is rather more surprising – the real delivered into the world. “Forget Tiger Woods and Ernie Els. reason Lewis is in town, according to Mitchells & Butlers,” said the source. The next stage of the 600-acre

Rooms with a view: work is due to start on Joe Lewis’s Albany Marina homes in early 2012

project, The Capitalist has learned and July, rising 23,000 compared to a ahead of the official announcement 69,000 fall across the UK. later this month, is the start of Funnily enough, he failed to men- building works on the marina resi- tion that in east Glasgow, almost a dences, to be sold during construc- fifth of the population claims incapac- tion by a newly opened Albany ity benefit. Maybe George Osborne office in Berkeley Square. shouldn’t adopt the so-called “Plan Leading the new office is Albany’s MacB” after all. business development director James Deen, most recently spotted at inter- national members’ club The Eden Club. Just the right credentials, then, to persuade Mediterranean yacht owners to invest in a marina-side penthouse with a private swimming pool alongside a winter berth for their boat in the Caribbean. JUST FOR MEN IT SOMETIMES feels like he would turn up to the opening of an envelope. But Nick Candy, the newly crowned Entrepreneur of the Year by GQ maga- zine and suit afficionado, was nowhere to be seen at the opening of a new Spencer Hart store on Mayfair’s Equal footing: Theresa May and John Heaps Brook Street. Instead, Liongate Capital’s co- founders Randall Dillard and Jeff EVERSHEDS OPTS IN Holland; Mike Asscher, the director of A PUBLIC engagement close to development of Far East business for Theresa May’s heart yesterday, as the the Royal Asscher Diamond Company; home secretary launched the govern- Owen Murfin, managing director of ment’s voluntary gender equality ini- BlackRock Global Capital Securities; tiative at Eversheds. and Justin Marciano, managing direc- “Promoting equality of opportu- tor of Revolver Entertainment; trotted nity and equal treatment isn’t just along to admire the tailor’s “fresh and the right thing to do, it’s also cru- modern retail world for men”. cial to promoting growth,” said May, Open for business today, the flag- speaking at the City law firm that ship shop marks a new direction for has 27 per cent female representa- the brand, which has diversified into tion on its board. books, films, music and art – over to Also adding weight to the debate you as to whether the “Spencer Hart were Katja Hall, chief policy director scent”, designed by Floris heir Edward at the CBI; Tesco personnel director Bodenham, is a step too far… Judith Nelson; BT Group’s people director Caroline Waters; and Eversheds chairman John Heaps, who recently joined The 30 Per Cent Club. “We have been externally reporting on diversity for three years,” Heaps told The Capitalist. “We regard it as an important part of the culture of our firm that we do so – it is crucial both our clients and our staff understand how important the issue is.” GIRL POWER SO PERHAPS Eversheds and its high- Tailor made: the new Spencer Hart store powered panel could help spread the word about the Women of the Future Awards, open to high-achieving NO MACPLAN B women under 35 in the UK, which THERE is something galling about has issued a last call for entries ahead Alex Salmond, the Scottish first minis- of the closing date on 21 September. ter, lecturing the rest of the UK on the Nominate either yourself or a col- economy. league at http:// Yesterday, the bumptious Scot was womenofthefuture.co.uk to stand a crowing from the rooftops about chance of joining the winners at the Scottish employment, which outper- awards ceremony at the Marriott Hotel formed the rest of the UK between May in Grosvenor Square on 16 November. CITYA.M. 15 SEPTEMBER 2011 News 11 Cairn gets the nod from shareholders

▲ ENERGY has encountered numerous road- blocks from regulators. BY MARION DAKERS Having won the green light from ENERGY explorer Cairn yesterday the Indian government in the sum- came a step closer to completing its mer after agreeing a royalties deal, $6.5bn (£4.1bn) Indian asset sale, Cairn now has the nod from 97.29 after its shareholders gave their per cent of its shareholders. blessing to the disposal. However, excluding shares The FTSE 100-listed firm has been owned by Cairn or Vedanta busi- trying to sell Cairn India, which nesses, just 60.82 per cent of operates oil fields off the coast of investors by value voted yes in the Yves Carcelle will remain on the LVMH board once Constans takes over the top job at Louis Vuitton Picture: REUTERS Rajasthan, for more than a year but postal ballot. Danone dairy chief to run Louis Vuitton

▲ RETAIL Spain, was head of Danone’s fresh BY HARRY BANKS dairy products division, the group’s biggest, and a member of its execu- LOUIS Vuitton, the star brand within tive board since 2008. He joined the world’s biggest luxury group Danone in 1990. LVMH, yesterday unveiled a succes- The nomination comes as LVMH’s sion plan which will see a former other major brand Dior is in talks Danone executive, Jordi Constans, with Marc Jacobs, Louis Vuitton’s take the executive reins as of 2013. artistic director, to replace John Yves Carcelle, 63, chief executive of Galliano, sources close to the matter the French leather goods maker have said. since 1990, will remain on the execu- However, this week fashion media tive board of LVMH and be in charge reported negotiations between of strategic missions for Bernard Jacobs and Dior were stalling, partly Arnault, chairman and chief execu- on money issues. If Jacobs leaves tive of LVMH. Vuitton, there has been speculation “This is of course about an organ- that Phoebe Philo, designer at sister ised succession, not a replacement,” a brand Celine, would replace Jacobs at spokesman for LVMH said yesterday. Louis Vuitton. Carcelle will also become chair- LVMH shares, which have lost 11.4 man of the brand’s foundation, per cent since the start of the year, which is to open its doors in early closed up 2.5 per cent at €111.80 yes- 2013. terday. Louis Vuitton, which generates In July, LVMH reported a glittering nearly €6bn (£5.2bn) in annual rev- first half, with revenues up 15 per enues and contributes more than cent to €10.3bn (£9.1bn). half of LVMH’s operating profits, said Profits from recurring operations 2012 would be a transition year dur- rose 22 per cent from the same time ing which Constans would work last year to €2.2bn – a reflection of alongside Carcelle to learn about the the growing appetite for luxury brand and the job. goods, particularly in emerging mar- Constans, 47, originally from kets. Brevan leads Ryanair hits out listed hedgies at Aer Lingus ▲ HEDGE FUNDS ▲ AVIATION BREVAN Howard’s BH Macro fund is RYANAIR attacked the board of Irish the best performer of UK listed hedge airline Aer Lingus yesterday, funds, adding 15 per cent to its net demanding it ask shareholders their asset value in the year to date, Numis views on three issues in a bid to analysts said yesterday. rebuild value at the company. Performances across the sector Ryanair, currently one of the were mixed but still helped insulate biggest shareholders in Aer Lingus, investors from stock market turbu- said investors should decide whether lence. All but the Dexion Equity they receive an €0.20 per share spe- Alternative outperformed the FTSE cial dividend to compensate for the all-share index in the year to date. firm’s 80 per cent loss of value since Analysts led by Ewan Lovett-Turner 2007. said funds had reduced their leverage It said investors should also be and stable investor bases so were bet- asked their views on a halt on pay- ter placed to withstand a crisis in ments into the firm’s pension fund, financial markets than in 2008. which is running a large deficit. 12 News CITYA.M. 15 SEPTEMBER 2011

Entertainment One MEET THE ADVISERS is distributing the new film version of HARRY HAMPSON ALASTAIR BLACKMAN John Le Carre’s Tinker Tailor JP MORGAN CREDIT SUISSE Solider Spy, released in UK cinemas this weekend

FOR advice on its strategic review, Hampson then took a key role for which many expect to result in the sale NewsCorp on its ultimately doomed bid of the company before the end of 2011, for the remainder of BSkyB shares, which Entertainment One has turned to man was abandoned in mid-July during the of the moment Harry Hampson, height of the phone hacking scandal but European telecoms and media invest- could be revived once investigations are ment banking chief at JP Morgan. completed. Canadian-born Hampson has Away from the office, Hampson is part made quite the splash in the owner of Italian restaurant media world over the past Osteria dell'Arancio on couple of years, first coming Chelsea’s King’s Road. He to mainstream prominence is joined on the when he acted for Entertainment One account Bertelsmann, whose RTL by David Harvey-Evers. Group sold Channel 5 to Also helping the Peppa Pig Richard Desmond for owner conduct its strategic Entertainment One £248m in July 2010. review is Credit Suisse, led by But its Hampson’s work for head of media investment banking NewsCorp that’s really raised Alastair Blackman. his profile in recent Blackman, with col- months, after he leagues Indy advised Rupert Bhattacharyya and soars on bid interest Murdoch on the Stuart Field, also advised digi- acquisition of his tal sports media group daughter Elisabeth’s Perform on its London initial independent television public offering in April. ▲ MEDIA whose revenue streams cover film, Analysts said the rumoured price production company, Shine, Credit Suisse’s Joe Hannon is also BY ELIZABETH FOURNIER television and music distribution of £400m would be “reasonable”. completed in April this year. advising. rights. That values the company at around SHARES in Entertainment One “Entertainment One would be £2.15 per share, a 30 per cent premi- leapt by up to 25 per cent yesterday best suited within a big US media um to its closing price on Tuesday, after the Peppa Pig owner con- company that will make continued before bid rumours began. firmed it was mulling a sale, adding investment in its content rights,” almost £75m to the company’s mar- said Patrick Yau at Peel Hunt. ANALYSIS l Entertaiment One Ltd ket capitalisation. Private equity is also likely to be Entertainment One said yester- interested, though management 200 p day it was “considering its strategic may be sceptical, as its a model that 194.50 options... in response to interest it has proved less successful in the 14 Sept has received from various parties”. past. Other names being linked Though a spokesperson for the with a possible bid include Sony, 180 firm said that reports naming Alliance Films, Lionsgate and even Disney and Viacom as potential bid- NewsCorp, though Entertainment ders were “plucked out of the air”, One insisted discussions were “very analysts said a large US trade buyer preliminary” and that there were would be the best fit for the group, no bids on the table. 8 Sept 9 Sept 12 Sept 13 Sept 14 Sept Network @ NetworkBanker Register on NetworkBanker for banking job email alerts

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© Citigroup, Inc., 2011. All rights reserved. Citi, Citi and Arc Design and CitiFX Pro are trademarks and service marks of Citigroup Inc. and used and/or registered throughout the world. CitiFX Pro offers trading on margin. The leverage created by trading on margin can work against you as well as for you, and losses can exceed your entire investment. Before opening an account and trading, you should ensure that you understand the risks and can withstand the losses and that you seek advice from your advisors as appropriate, please see www. citifxpro.com for further details. This information is directed only at persons in the UK who qualify as Professional Clients (as defi ned in the rules of the Financial Services Authority) and CitiFX Pro is only available to Professional Clients in the UK. Classifi cation as a Professional Client may require an assessment of the person’s experience and knowledge (in roll- ing spot or similar instruments or markets). CitiFX Pro is a service offered to you by Citibank International plc which is authorized and regulated by the Financial Services Authority. Registered Offi ce: Canada Square, Canary Wharf, London E14 5LB. VAT registration number GB 429 625 629. The main business of Citibank International plc is banking and securities business. It is entered on the FSA register under number 122342. 14 News CITYA.M. 15 SEPTEMBER 2011 Galliford Try’s earnings jump Taylor Wimpey cuts costs

▲ through a bond buyback PROPERTY £1.28bn. division, said it was on track to BY KASMIRA JEFFORD Chief executive Greg complete 3,000 units this year, Fitzgerald (pictured right) with a strategic focus on the CONSTRUCTION and housebuilding said its housebuilding arm south of England. ▲ PROPERTY It had initially set out to buy back firm Galliford Try has posted a 34 per saw the number of comple- Revenues in its construction around £60m of the bond when it cent jump in full-year adjusted pre- tions rise 27 per cent to business were flat and underly- HOUSEBUILDER Taylor Wimpey is launched the tender offer last week, tax profit, beating expectations, driv- 2,170 after the market ing profits dipped by three per expected to save approximately but received tenders amounting to en by its focus on southern England. picked up in the second half cent to £22.2m as Fitzgerald £8.3m in debt interest costs on an £117.2m by the expiration of the Galliford, whose projects this year of the year. warned that the market annual basis after drawing strong offer, it said yesterday. include restoring London’s St Pancras The group, remained increas- demand for a buyback offer on its • Meanwhile, Crest Nicholson said Chambers and the athletes’ village at which raised ingly competi- outstanding 10.4 per cent bond yesterday it had strengthened its bal- the Olympic Park, said pre-tax profits £119.3m in tive. Galliford maturing in 2015. ance sheet after successfully complet- for the financial year came in at 2009 to double upped its divi- The company announced yesterday ing a major debt restructuring. In all, £35.1m compared with £26.1m last the size of its dend by 28 per it would buy back £82.4m of the out- £359m of its debt has been converted year on revenues up five per cent to housebuilding cent to 18p. standing £250m bond. to equity. Barratt posts its first profit in three years Barratt has returned to profitability after three years of losses ▲ PROPERTY gage finance was restricting activity Picture: GETTY BY KASMIRA JEFFORD in the housing market, growth would be maintained by a focus on higher BARRATT Developments, the UK’s prices and new land, which it said biggest housebuilder, hailed its first should make 35 per cent of sales this underlying profit in three years yester- year, up from 12 per cent in 2011. By Kasmira Jefford day, helped by higher selling prices, The company also carried out a sig- WHAT IS YOUR OUTLOOK FOR THE HOUSEBUILDING SECTOR? and expects to make further progress nificant refinancing with £1bn of despite a sluggish housing market. committed facilities and reduced the The group reported a full-year prof- net debt on its balance sheet to CHRIS MILLINGTON | NUMIS MARK HUGHES | PANMURE GORDON it before tax and exceptional items of £322.6m, down from £366.9m in the £42.7m compared with a loss of £33m previous year. in 2010, beating market estimates. Shares rose by 1.12 per cent last The housing sector, at such a low level of We are currently building a historically low “We have made considerable night, closing at 77p. activity, is showing a remarkable level of resilience. level of new homes in the UK and therefore from a progress in rebuilding profitability – “If we don’t get an interest rate rise it is very unlikely “volume perspective, whilst I don’t see things taking by optimising selling prices, improv- ANALYSIS l Barratt Developments Plc that we will see a big onset of foresellers in the mar- off to any great degree, I think this is a perfectly ing operational efficiency and secur- ket -- so if that is the case, I think pricing stays pret- sustainable level of output. We’ve been forecasting ing new higher margin land,” Mark p 77.00 ty stable and companies show quite big lifts that house prices would fall by anything up Clare, chief executive, said. 14 Sept in profits. I am quite upbeat on the sector. to a couple of per cent this year. The company was lifted by strong 80.00 second-half trading in London, where average selling prices of private homes 77.50 ” ” were higher, as well as a shift in focus ROBIN HARDY | PEEL HUNT to family homes as opposed to flats. 75.00 Its private average selling price was up 7.4 per cent for the year to £198,900. I think we are still fairly cautious on the market outlook ...Housebuilders still produce a lot of their output in regional markets and certainly the RICS housing market survey yesterday suggests a bleak outlook for a lot of those Barratt said that while low con- 8 Sep 9 Sep 12 Sep 13 Sep 14 Sep struction levels and a lack of mort- “areas…like the Midlands, where a lot of the housebuilding outlook is still produced. ”

HOME EVENT CITYA.M. 15 SEPTEMBER 2011 News 15 AVON CELEBRATES 125TH BIRTHDAY Spain pushes Avis Budget ahead with IPO drops bid for of state lottery ▲ M&A SPAIN’S plans to sell a stake in its state lottery operator are on course Dollar Thrifty to be completed before a November general election, despite volatile markets and opposition from the likely new government. ▲ TRANSPORT Hertz’s offer is currently worth Loterias y Apuestas del Estado said BY HARRY BANKS about $1.92bn (£1.22bn), based on in a statement it had not changed the stock’s last closing price. plans for what would be Spain’s CAR rental company Avis Budget However, after Avis acquired its biggest-ever initial public offering – Group has dropped out of the race European namesake in June for set to raise €7bn for state coffers -- to buy Dollar Thrifty, after a pro- about $1bn, Wall Street’s expecta- after El Mundo newspaper reported longed bidding battle with rival tions of a higher bid from Avis had the government might delay the Hertz Global Holdings. come down significantly. sale. Avis said it had made significant Avis had not matched Hertz with “I don’t know where that comes progress in obtaining regulatory a counter bid. from,” economy minister Elena clearance for the Dollar Thrifty Hertz first agreed to buy Dollar Salgado told reporters in Congress acquisition, but had decided not to Thrifty in April 2010, in a $1.2bn yesterday morning when asked pursue a transaction due to cur- deal that would have created the about the story. She said there was rent market conditions. second-biggest US car rental com- “no change” in plans. Avis and rival Hertz have been pany. “Once the stock market regulator chasing Dollar Thrifty for more But Avis filed a counterbid of approves the lottery’s IPO prospec- than a year, amid growing consoli- about $1.33bn that July, topping tus, expected by the end of dation pressure in the industry, the Hertz offer and starting a bid- September, the process will begin for and were in separate talks for ding war that has rumbled on ever the company to list on the exchange antitrust approval. since. Shares of Hertz jumped near- before the first week of November, as Dollar Thrifty had set a deadline ly nine per cent to $10.88 in early expected,” Loterias said. of 10 October for both the compa- morning trading, making them Two sources close to the deal said nies to make their final buyout one of the top gainers on the New analysts were due to begin meeting offers, to end the continued uncer- York Stock Exchange. COSMETIC group Avon, which has 300m customers worldwide, celebrates its 125 year with investors next week to market tainty surrounding the deal. Dollar Thrifty shares rose 0.53 anniversary today. Avon is the world’s largest direct seller, with over 3.5bn products sold the offering of a 30 per cent stake. It also adopted a poison pill to per cent per cent to $65.04, while each year in more than 100 countries. The cosmetics giant has 6.5m independent representa- The Loterias market debut was thwart unfriendly takeovers after Avis’ shares rose 6.3 per cent to tives – its famous “Avon ladies” – and profits of £2.9m a year. Avon was launched in 1886 still targeted for 18-20 October, one Hertz raised it buyout offer in May. $12.48 on the Nasdaq. with a line of five fragrances, and now creates nearly 1,000 products every year. source added.

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▲ RETAIL profits were affected by “our commit- “Yes I think so. It's only a short trip from London and col- BY JOHN DUNNE ment to Never Knowingly Undersold and a highly competitive trading leagues who have already been have told me it’s really JOHN Lewis yesterday revealed a environment.” The partnership also impressive. I think it can be a real asset for London slump in profits as discounting in the reported a 65 per cent increase in face of the tough consumer climate investment with a £253.8m injection and really expand on what's already on offer here.” took its toll. into new formats and branches, The retailer, which also owns the including the Westfield Stratford JAMES MILNE | LLOYDS Waitrose chain, said first half pre-tax store close to the Olympic park. profits plunged by 18 per cent to A dozen more Little Waitrose £90.4m. branches are planned for the second “It's completely out of the way for me, but I think I will make Its Never Knowingly Undersold half as well as two new John Lewis pledge – meaning that they will offer home shops. the effort to go and see it. I think it will prove to be very the lowest prices on the market – con- Mayfield added: “Sales grew strong- popular with Londoners and may even prove tributed to the fall as retailers cut ly although, as expected, profits were their prices to boost sales. lower than in the same period in 2010 appealing to European travellers.” The drop in profits in the six as we accelerated investment in our months to 30 July at John Lewis and future growth plans. KETAN SHAH | SAGICOR Waitrose came as the partnership “We are not simply waiting for the increased total sales by five per cent recovery, but instead we have to £3.6bn. increased the pace of investment and “I am quite intrigued by all of the hype surrounding it Sales growth was strongest at innovation across the partnership... Waitrose, where like-for-like sales – a Our momentum is strong.” so I will certainly pay it a visit. I don't think it will stand measure that strips out the impact of The company said Waitrose had out as a unique feature for London but it will add a new store openings – increased four managed to absorb the impact of lot to the east end of the capital.” per cent year on year. price inflation rather than passing it Chairman Charlie Mayfield said on to customers. * These views are those of the individuals above and not necessarily those of their company. CITYA.M. 15 SEPTEMBER 2011 News 17 Directory arm Next upbeat saves the day HOW does Next do it? As a mid- market retailer with a presence in most town centres, you’d expect it on 2012 while to be suffering from the gloom on the high street, not bucking it. It is Next’s catalogue and inter- net business, Next Directory, that has proved the firm’s saviour, pro- viding exposure to both the surge earnings rise in online retail sales as well as more buoyant markets overseas. Sales excluding VAT in Next’s Retail division – essentially all the ▲ RETAIL have negotiated a third of our prices physical stores – actually fell 1.8 per BY JOHN DUNNE for our spring collection and are con- cent during the first half. That puts fident that we will see little or no it in line with most of its peers and NEXT yesterday said there was a inflation in our selling prices in the significantly behind some others, chink of light amid the retail gloom first half. The cotton price bubble has such as John Lewis. as it forecast a pick-up in sales in collapsed.” Next Directory, however, grew 2012. Next Directory saw a 15 per cent sales by 15.2 per cent over the same The retailer said there had been a rise in sales and an 11 per cent period. International directory “perfect storm” in 2011 with cus- increase in profits in the first half of sales jumped to £32m from £10m tomers squeezed by surging energy the year. That contrasted with a 1.8 in the same period last year. bills, the slowdown in government per cent fall in overall retail sales. Since 1997, when Next Directory spending and a hike in VAT. Wolfson said that sales among sales were £208m a year, the divi- However, pre-tax profits for the six young customers, particulary with its sion has gone from providing months to 30 July rose 8.5 per cent to Lipsy brand, were suffering as they around a third of what the shops £228m. were faced with debt from university brought in (£639m) to around a Next said prices were seven per fees and difficulties in finding work. half today (£935.5m compared to cent higher in the first half and Nevertheless, Next said it now £2.2bn). That trend will only accel- would be eight higher in the second, expects profits for the full year to be erate. but with the cost of cotton falling around £590m, up from the £577m it So there will be much talk about prices would stabilise. previously forecast. how Next’s results provide hope for Chief executive Lord Simon The group said it expects to open the high street, but the real story is Wolfson (left) gave an upbeat forecast another 400,000 sq ft of retail space, the growth in shopping from for next year but warned that the in the second half of the year with home – especially online. Eurozone sovereign debt crisis was a another 400,000 sq ft expected next variable which could still derail any year. recovery. The firm raised its interim divi- He said: “There are indications that dend by 2.5p to 27.5p and will pay BOTTOMLINE 2012 will not be as challenging. We shareholders on 3 January. Analysis by David Crow 18 News CITYA.M. 15 SEPTEMBER 2011 UK energy firm Gulf Keystone Hargreaves in to seek main 18pc profit rise ▲ ENERGY BRITISH energy support services firm Hargreaves Services posted an 18 per market listing cent rise in full-year pre-tax profit yesterday, bolstered by robust coke and coal sales in Europe, and said it expects strong demand for high- ▲ ENERGY field, the group’s first Kurdistan dis- grade coal from steel producers. BY KASMIRA JEFFORD covery in 2009. The supplier of solid fuels and bulk Interest in Kurdistan has surged Sam Moody, Rockhopper’s chief executive, hopes to produce oil in the Falklands in 2016 material logistics said it would pay a GULF Keystone Petroleum, the over the year as relations between final dividend of 10.4p per share, Kurdistan-focused oil explorer listed Iraq’s central and regional govern- bringing the full-year dividend to on the alternative investment market, ments improved. 15.5p a share, up about 15 per cent said yesterday it is targeting a move up The semi-autonomous government from last year. to the main listing in the first half of of Kurdistan has been haggling with Rockhopper set to invest The firm, which was established in next year. Baghdad over its right to hand out 1994 as a specialist bulk haulier, said “As at 12 September 2011, the com- licences and collect tax revenue from it expected its Tower Colliery project pany had a market capitalisation of the oil production, which oil majors in South Wales to contribute signifi- £1.2bn which would place it comfort- are confident will soon be resolved. £1.3bn in Falklands plan cant profits, after the planning per- ably in the higher echelons of the FTSE Gulf Keystone rose in early morning mission for the project was finalised. 250 index if it were currently eligible,” trading before closing down 1.24 per Hargreaves Services’ four operat- chief executive Todd Kozel said in a cent yesterday at 179.25p. ▲ islands, over which it still claims sover- ing divisions -- production, energy statement yesterday. ENERGY eignty. and commodities, transport, and The company, which has made huge ANALYSIS l Gulf Keystone Petroleum Ltd Rockhopper said yesterday it expect- industrial services – plan to focus oil discoveries in Kurdistan, also BRITISH oil group Rockhopper ed to start pumping oil in 2016 from mainly on Europe, Asia and the steel p 179.25 announced plans to exit a project with 14 Sept Exploration has unveiled plans for a the Sea Lion discovery made in 2010 sector this year. Hungary’s Mol Nyrt to fund other 180 $2bn (£1.3bn) investment in the and production would ramp up to a Underlying pre-tax profit in the operations in the region. 170 Falkland Islands, a move which will maximum of around 120,000 barrels year to the end of May rose to £40.5m Gulf Keystone will sell its 20 per cent transform the remote territory into a of oil per day by 2018. from £34.3m last year. Revenue interest in the Akri-Bijeel block, esti- 160 new oil province. Rockhopper said its reserves, which climbed 20 per cent to £552.3m. mated to hold around 2.4bn barrels of 150 The emergence of the British-gov- it estimated at around 350m barrels of The company’s shares, which have oil, for around $350m, the company erned territory as an oil producer will recoverable oil, were large enough for risen by more than 40 per cent over said yesterday. 140 likely stoke tensions with Argentina, a development, having spent recent the past year, closed up 9.1 per cent It plans to use the proceeds to help which 30 years ago fought a war months drilling a series of test wells to at 982p, valuing the business at fund the development of its Shaikan 8 Sept 9 Sept 12 Sept 13 Sept 14 Sept against Britain for control of the establish the size of the oil field. £243m.

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raise any money for the Treasury, £500m a year. ernment scraps the 50p tax, it could But I suspect that if Warren that is? This will be no surprise to stu- use the money raised to lift more Buffet was paying tax at a UK rate of Opinion polls show that the pub- dents of the Laffer curve, which sug- low earners out of tax altogether. 50 per cent rather than the US rate lic only supports the tax on the gests that above about 40p in the And at the same time, it would give of 35 per cent he would be a little grounds that it raises money; if it pound, the more you raise tax rates, a boost to the economy. Win, win, less saintly. doesn’t, then the majority are the less revenue you get. win – who could possibly argue The implosion of the economic happy to scrap it. This turns all the arguments against that? arguments in favour of the tax show So the report yesterday from the about the 50p tax upside down. The Quite a few – but with increasing- that what is really behind it is what Institute for Fiscal Studies, by Nobel- question isn’t whether we can ly emotive irrationality. Some say brought Britain to the brink in the laureate Sir James Mirrlees, is game- afford to get rid of it, but can we we need the tax to bash the 1970s – the politics of envy. It has ANTHONY BROWNE changing. afford to keep it? How many public bankers, but more than three quar- made a comeback, which is bad for It is the best evidence we have, sector jobs are we having to cut in ters of those who pay the tax have us all. and it concludes: “According to order to satisfy our lust to punish nothing to do with financial servic- If Britain is to have a successful HE debate about the 50p tax these estimates, the introduction of the rich? Why should those on es. future, we must celebrate success – swirls on, but there is only one the 50 per cent rate would actually lower incomes pay higher taxes to We hear that the rich in the US not seek to punish it. question that really matters: reduce revenue.” The IFS thinks that make up the shortfall? and France want to pay more tax, Anthony Browne is former director of Tdoes it work? Does it actually it costs the Treasury approximately Or put it another way – if the gov- and so should the rich here. Policy Exchange NEWS | IN BRIEF

Allergan confident on Botox Allergan, the global pharmaceutical RSM Tenon in company that makes Botox and breast implants, has forecast nearly £1bn in Botox sales this year, and said the com- pany continues to be robust in the US despite a sluggish economy. Botox, most commonly used to smooth wrin- share fall as kles, has recently acquired US approval to treat migraine headaches and over- active bladders, positioning it to grow beyond the 30 per cent of Allergan sales it accounts for now. The company is also increasing its investment in Asia dividend cut to take advantage of growing demand for its products, with revenues in Asia

▲ up 36 per cent from a year ago in its FINANCIAL SERVICES cult to predict but that the company latest quarter. BY JOHN DUNNE was on course. “We have improving returns and Al Carey is Pepsi’s new chief executive of Americas beverages Wal-Mart invests in women ACCOUNTANCY firm RSM Tenon saw reducing net debt. We will maintain Multinational retailer Wal-Mart has its share price dented yesterday after our prudent stance and we look for- announced that it plans to commit $5bn announcing that it would slash its ward to further progress against our (£3.2bn) annually by 2016 in the US to annual dividend. rivals,” he said. Pepsi shakes up drinks unit double the amount spent on training The company said the move was The company said that the per- women, and sourcing from international “prudent” in a tough trading environ- formance of its audit division had suppliers run by women. Wal-Mart also ment, while also reporting a rise in helped to fuel a rise in profits. plans to help train and educate 400,000 profits. It said its net debt stood at £65.7m in bid to boost its business women into jobs, and in financial-related Pre-tax profits increased to £27.1m on 30 June compared with £43.1m skills. in the 12 months to 31 June, com- last year. pared to £24.1m during the same Brooks Macdonald profits rise ANALYSIS l Tenon Group Plc ▲ period last year. FOOD & BEVERAGE Carey, 60, will take over responsibili- Integrated wealth management group RSM, which offers a range of busi- p 21.75 ty for all aspects of the beverage busi- Brooks Macdonald has released end-of- ness services, said the acquisitions of 14 Sept PEPSI announced a shake-up of its bev- ness in the Americas, including the year results showing pre-tax profits of RSM Bentley Jennison in 2009 and erages unit yesterday, appointing a North American bottlers that PepsiCo £7.3m, a 28 per cent increase on 2010. some assets of Vantis in 2010 had 27 new head to try to turn around the bought in 2010. The figures, released yesterday, also helped to boost the figures. 26 business, which has lagged behind Eric Foss -- former chief executive of revealed that total funds under manage- But it has reduced its dividend to 25 Coca-Cola in North America. Pepsi Bottling Group, which PepsiCo ment increased by 36 per cent, to nearly 0.55p per share from 1.6p in 2010 as 24 Pepsi named Albert Carey, a 30-year acquired last year -- will leave the com- £3bn. Chris Macdonald, chief executive uncertainty still surrounded the 23 PepsiCo veteran who most recently ran pany in December. of the AIM-listed company, said that the economy. 22 its Frito-Lay North America unit, to be His eventual departure was expect- results are “significant” and show that Chief executive Andy Raynor said chief executive of PepsiCo Americas ed following the integration of the bot- Brooks Macdonald can continue to 8 Sep 9 Sep 12 Sep 13 Sep 14 Sep the trading environment was diffi- Beverages, effective immediately. tler. grow.

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CITY MOVES | WHO’S SWITCHING JOBS Edited by Harriet Dennys in association with

International. Silver will oversee the Simon Cottle and Thorsten Toepfer to NS&I JM Finn & Co EUIB arm in addition to his current its services sector team as associate Lord Sassoon, the commercial secretary to the The investment manager has made five role leading the business services bank- directors. Cottle joins from Cognetas, Treasury, has appointed Sir John de Trafford senior hires, all from Williams de Broë, ing practice in Europe. where he spent three years as an as the new chairman of the board of NS&I to to expand its private client service. investment manager, while Toepfer replace Martin Gray, effective from 1 January Peter Hancock, Andrew Banks and Fulcrum Asset Management was previously a member of the invest- 2012. De Trafford, who joined the board of Michael Burton join as senior invest- The fund manager has appointed ment team at Hellman & Friedman. NS&I as a non-executive director on 1 January ment managers and Brendan Company Nicholas Smith as a director within the 2010, spent his early career at Unilever and and Mark Jeffreys join as investment UK institutional marketing and sales Aon Hewitt Guinness before moving to American Express managers. team. Smith joins from Towers Watson The HR consulting and outsourcing and rising to regional president for Northern where he was head of the UK DC business has hired Mike Curtis to its Europe and chair of the company’s EMEA Baird investment team. He also previously reward and engagement team as a Executive, retiring from the role five years ago. The employee-owned investment bank worked at Schroders, where he was an senior consultant. Curtis joins from has announced that David Silver will executive director, responsible for UK QCG, where he was compensation and Sirius Petroleum director on 1 August from Renaissance succeed John Fordham as head of pension clients. benefits practice leader, having previ- Ed Johnson has been promoted to chief Capital, where he was head of the new European investment banking (EUIB), ously spent more than five years at executive of Sirius Petroleum, after markets oil team for investment bank- and Fordham will take up the newly HgCapital professional services company Towers joining the company as commercial ing and financing. created position of chairman of Baird The private equity investor has hired Perrin. To appear in CITYMOVES please email your career +44 (0)20 7092 0053 updates and pictures to [email protected] SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT morganmckinley.com

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ANALYSIS l Close Brothers Group PLC ANALYSIS l Ashmore 389.90 ANALYSIS l Accor p 677.00 14 Sept 800 15 Sept 420 p € 22.35 775 14 Sept 30 750 725 380 700 26 675 340 650 22

Jul Aug Sep 15 Sep Jul Aug Sep Jul Aug Sep CLOSE BROTHERS ASHMORE ACCOR UBS rates the merchant bank “neutral” with a 12-month target price of 700p, JP Morgan rates the industrial group “neutral” with a target price of 410p. Deutsche Bank rates the global hotel manager a “buy” with a target price of down from 780p. The broker notes that market levels have dropped material- The broker says Ashmore’s preliminary results were in line with estimates, €37. The broker thinks yesterday’s investor day was a crucial time for the firm ly since the firm’s last update in July, and has cut its 2012 estimates by 11 per and that performance since the year-end has been reasonable. However, it to set out its strategy, and that the results were largely impressive. The com- cent. UBS is cautious about the outlook for equity volumes, corresponding to has trimmed some forecasts for performance fees and operating margins. pany’s new EBIT forecast of €510m-€520m for the year was in line with a five per cent fall in the firm’s operating profits. The broker also expects a Overall, JP Morgan thinks Ashmore deserves its premium to the rest of the Deutsche’s expectations, though below consensus forecasts, and the asset lower rate of improvement in credit quality. sector, given the growth potential for its operations in emerging markets. reshuffle seems a sensible way to improve returns. FTSE closes higher after Euro US stocks climb on chiefs reassure on debt crisis back of relief rally

session’s 0.9 per cent gain, ume, nearly four times its 90-day and into the euro and into global although it remains down 3.1 per daily average, was high street fash- equities,” said Fred Dickson, chief THELONDON cent in September. ion retailer Next, up 6.3 per cent THENEW YORK market strategist at DA Davidson & Underscoring the political dis- after its first-half profits beat fore- Co. unity at the heart of the crisis, casts. The Dow Jones industrial average REPORT Austrian approval of changes to The firm said any further ero- REPORT was up 140.88 points, or 1.27 per cent, the region’s bailout fund faced a sion of Eurozone sovereign at 11,246.73. The Standard & Poor’s RITAIN’S leading shares setback after a parliamentary com- finances was the biggest unknown 500 Index was up 15.81 points, or 1.35 closed higher yesterday after mittee failed to clear the measure risk for profits going forward, S stocks rose one per cent in a per cent, at 1,188.68. The Nasdaq Europe’s top bureaucrat said for a quick vote. although it was more sanguine on third day of gains yesterday Composite Index was up 40.40 points, Bplans for a common euro The news prompted a short-lived the outlook for the UK consumer. after European leaders dis- or 1.60 per cent, at 2,572.55. bond, seen by many as a key tool to index pullback and came ahead of Peers elsewhere in the sector Uplayed new urgency in efforts The S&P 500 is still down 11.6 per help end the regional debt crisis, a conference call between German, were boosted by Next’s results, to contain the Eurozone debt crisis. cent since 22 July, roughly when the would be presented shortly. French and Greek leaders as with Marks and Spencer up 2.5 per- German and French leaders called market’s recent slide began. A common bond would give the Athens tries to implement austeri- cent, although macroeconomic on Greece to implement all financial The actions by European leaders weaker peripheral countries access ty cuts and secure fresh bailout data did little to help, as the num- reforms “strictly and effectively”, a followed an urgent call by US to cheaper funds, backed by core funds. ber of UK unemployed rose at its German government spokesman said. Treasury secretary Timothy Geithner Europe, although regional paymas- Weak US retail sales data added fastest pace for two years. Greece expects policymakers to for them to act forcefully to solve ter Germany has consistently to the pullback. With data weakening across the report that Athens is on track to ful- Europe’s debt crisis. Geithner said opposed such as move. The lack of clarity was evident in developed world, fears of a return fill its targets and receive the aid it they have the financial and economic The comments from European the derivatives markets, Atif Latif, to recession are rising and the needs to avoid any chance of a debt capacity to do so. Commission President Jose Manuel director of trading at Guardian chances of a fresh round of quanti- default, a Greek official said. Conglomerate GE ended 2.5 per- Barroso clipped gilt futures, in a Stockbrokers said, citing buying of tative easing from the Bank of Adding to the relief for investors, cent higher at $15.79. Tech stocks also further sign of investors’ willing- puts versus calls across both England are now 40 per cent, a Italian Prime Minister Silvio were among top gainers, and the ness to take on more risk, although October and November contracts, Reuters poll showed yesterday. Berlusconi won a confidence vote on Nasdaq outperformed the other two market conviction remained low, “possibly taking advantage of the an austerity plan for the Eurozone’s major indexes for a third day. Yusuf Heusen, sales trader at IG call skew”. third-largest economy. Shares of Nvidia Corp jumped 5.2 Index said. The trading pattern also seemed ANALYSIS l FTSE Fears that Europe’s crisis could percent to $15.28, while SanDisk Corp “The market remains sentiment “to indicate that investors are 6,200 plunge it into recession and drag rose 4.2 percent to $42.66. driven,” but was unlikely to break unsure about a directional play but 5,227.02 down global growth have hammered Dell added 3.3 per cent to $14.86 a out of current rangebound trade are now trading volatility,” he said. 14 Sept stocks for weeks. Stocks that are typi- day after its board authorized an until firm details around a bond Integrated oils led the charge 5,800 cally well positioned to benefit from additional $5bn stock buyback pro- were released, he said. “It’s bounc- thanks mostly to BP which ended economic growth, such as General gramme. ing around technical levels – hav- up 3.5 per cent after a key US gov- 5,400 Electric and other industrial shares, Volume was 8.5bn shares on the ing tried several times to get ernment report into the Macondo were top gainers. NYSE, Amex and Nasdaq, above last through 5,270.” oil spill split the blame between “What we’re watching is global year's average of roughly 7.6bn. By the close, the FTSE 100 was up the firm, fellow partners in the 5,000 hedge funds, at least momentarily, Advancers beat decliners by nearly one per cent, or 52.77 points, at field and contractors. throw the risk-trade switch back on, 11 to four on the NYSE and by about 5,227.02, adding to the previous Leading blue-chip gainers in vol- 20 Jun 08 Jul 28 Jul 17 Aug 7 Sep directing funds away from the dollar three to one on the Nasdaq. CITYA.M. 15 SEPTEMBER 2011 News 21 MASERATI UPBEAT ON SALES GROWTH Court close to FirstGroup's a decision on Carr moves Saab appeal ▲ TRANSPORT A SWEDISH court said yesterday it would decide in the next few days over to Ahold whether to allow struggling car maker Saab to appeal a ruling denying it pro- tection from creditors, with Saab almost certain to slide into bankruptcy if its case is rejected. ▲ RETAIL reduction programme and explore “The case will be dealt with as a pri- BY HARRY BANKS further ways to reduce costs. ority and a decision in the question of He started his career at Anglo- the right to appeal will probably be DUTCH supermarket group Ahold yes- Dutch consumer goods giant Unilever. announced in a few days,” The Court terday appointed Jeff Carr as its new Before he joined FirstGroup, Carr of Appeal for western Sweden said in a chief financial officer, picking an had been group finance director and statement. executive with experience at Unilever, board member at easyJet, and held Saab sought creditor protection last Associated British Foods and easyJet. senior financial roles at Associated week, owing workers their salaries and Carr, 49, is currently a board mem- British Foods, Reckitt Benckiser and suppliers hundreds of millions of ber at transport company FirstGroup Grand Metropolitan. crowns. Its factory in southwest and personal care products group Nick Chevis, who has been with Sweden has been mostly shut down McBride. Both firms said that he will FirstGroup since 1997, will become since early April. be standing down, and FirstGroup acting finance director until a perma- The court rejected Saab’s plea and at said a search for Carr’s replacement nent replacement can be found. the start of this week the car maker’s will start immediately. own unions served bankruptcy appli- Ahold had been looking for a ANALYSIS l Firstgroup cations – despite the company having replacement for the current finance conjured up a promise of €70m p chief, Kimberly Ross, for a few 360 339.30 (£60.8m) in vital financing. months. Ross is leaving Ahold in 14 Sept Saab appealed the decision, saying November to become CFO at US-based the lower court had overstepped its women’s cosmetics seller Avon. 350 remit and that the new money showed Carr will formally join Ahold pend- it had a viable future. Saab wants cred- ing shareholder approval at the next FIAT luxury brand Maserati is expecting sales growth of seven per cent this year, its chief itor protection to give it time until a annual meeting April. executive said yesterday, after the car maker presented its first SUV at the Frankfurt auto promised investment of €245m from 340 Alongside his new duties, Ahold show. “The [sales] trend of the first eight months of the year will be confirmed for the whole Pangda Automobile Trade and said Carr will also manage the compa- of 2011,” Maserati chief executive Harald Wester told reporters at the car show after unveil- Zhejiang Youngman Lotus Automobile ny’s existing €350m (£304.8m) cost- 8 Sept 9 Sept 12 Sept 13 Sept 14 Sept ing the new Maserati Kubang, the company’s answer to the German Porsche Cayenne. gets the nod from Chinese authorities. 22 Wealth Management | Personal Finance National Grid bonds are not without risk

At first glance any inflation-linked bond might look attractive for all investors but the devil’s in the detail, says Philip Salter

The best person to run your pension is

Get £ 10 0 There are powerful reasons to be cautious Picture: GETTY NFLATION stealthily redistributes ment of the principal amount off SIPP wealth from those with savings to returned at maturity (October 2021).” Trustee fees those with debts – which is why On the positive side, Luke Gale of y u Ihighly indebted governments Ashburton says, in contrast to infla- often turn a blind eye to it. But as tion-linked gilts, in which the face important as it is to beat inflation, value of the bonds is not guaranteed, your investment strategy should be the National Grid bond has a floor at driven by facts, not fear. zero. Thus: “If we enter a period of For those who missed out on the deflation and the RPI figure in 2021 is National Savings and Investments lower than that of the base RPI figure (NS&I) inflation-linked bond, recently – relating to February 2011 – the bond taken off the market, the temptation holder will still receive the face value to jump into the hot-off-the-press of the bonds at maturity.” National Grid inflation-linked bond You have the greatest vested interest in Please remember that investments, and might be overpowering. These bonds INFLATION SPECULATION your pension. So it makes perfect sense any income from them, can fall in value will be issued from 6 October until 29 “This bond is very much a speculation for you to run it. as well as rise and you may get back less September – or could finish earlier if on inflation over the next 10 years,” than you invested. We do not provide there is enough demand – and if held says Sofat. Patrick Connolly of AWD A Self Invested Personal Pension (SIPP) for the full ten years, investors are Chase de Vere cautions: “While the investment advice. If you’re unsure whether promised an annual 1.25 per cent product looks good now with infla- gives you freedom to invest your money a SIPP is right for you, we recommend you above inflation (paid semi-annually) tion high, the rate of inflation is wherever you think it will perform best. seek independent fi nancial advice. and the original investment adjusted expected to fall in 2012, not least when And with our SIPP Dealing account, for inflation. At just £2,000, with addi- the impact of January’s VAT rise is no tional £100 increments, there is a rela- longer included in the figures, and it you’ll have all the tools and information Take control of your future and put your tively low barrier of entry. They will be is likely that it will look far less attrac- you need to support your decisions investment expertise to good use. available through most brokers and tive then.” Cox notes that the markets and skilfully manage your stock market Download your comprehensive FREE guide can be sheltered from tax in an Isa or current “prediction for inflation over Sipp. Tempting, but investors should the next ten years is 2.639 per cent, per investments. You’re also free to choose to SIPPs, or apply for an account today – be alert to the risks before signing up. year.” Although Adrian Lowcock of your own Trustee/Administrator, giving and get £100 off participating SIPP Bestinvest cautions that economists you the fl exibility to choose the one that Trustees’ fees (see website for details). CURRENT RISKS tend to get their predictions wrong. best suits your needs. Although the National Grid is a gov- The safer inflation hedge of a NS&I ernment monopoly, it could still go inflation linked bond cannot be sub- bust – which could prove costly for stituted for a corporate bond of any Visit www.selftrade.co.uk/you bond holders, as this investment isn’t sort, as a Standard and Poor’s rating of protected by the Financial Services BBB+ on this one makes clear. Andrew or call 0845 0700 720 Compensation Scheme (FSCS). Swallow of Swallow Financial Although conservatively managed, Planning says they are “chalk and Lines are open Monday to Friday 7.45am – 7pm. there is nevertheless a risk that poor cheese.” Stuart Fowler of Fowler Drew Calls may be recorded. management or regulatory changes thinks National Grid’s bond should be could lead to its demise. The current ignored, because unlike the NS&I plight of the postal services in the UK bond, it is not a perfect hedge: “You and US show that government protec- cannot own enough different issues to tion can’t guarantee balanced books. spread the credit risk, making it fun- Because the National Grid bond can damentally unattractive, having tail trade below par, Hargreaves risk as large as equities but without Lansdown’s Danny Cox warns the real-return upside potential.” “investors could lose money if they Connolly advises those looking to take the money out early.” Anna Sofat invest in corporate bonds to spread of Addidi urges investors to under- their risk in an investment fund such stand that this is not a simple bank as the M&G Corporate Bond fund or deposit paying 1.25 per cent over the Fidelity MoneyBuilder Income fund, retail price index (RPI). She stresses yet on the former Swallow is reticent Selftrade® is a trading name of Talos Securities Limited and registered trade mark of Boursorama. Talos Securities Limited is incorporated in England and Wales (Registration No. 4196325, Registered Address: Boatman’s House, 2 Selsdon Way, London E14 9LA), is authorised and that this is a corporate bond issue with about its reliance on credit default regulated by the Financial Services Authority (FSA Register No. 208271) and is a member of the London Stock Exchange and PLUS Markets plc. RPI adjustment. Sofat says: “If the RPI swaps. The moral of the story is, as in February 2021 is lower than that in always, caveat emptor, especially with February 2011, there will be no adjust- products as complicated as this. 23

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APR: N/A With a concentrated portfolio of 40-60 hand picked • One of the lowest Total Expense Ratios (charge card) companies from countries such as China, Hong Kong, India in the AIC Asia Pacific ex Japan sector of ANNUAL FEE: £300 and Taiwan, the Trust aims for a high rate of total return by 0.9% (31 December 2010). BENEFITS: picking stocks the manager believes are mispriced and will l grow in the future. Preferred seating at the The Total Expense Ratio is a measure of the total expenses incurred theatre, sporting and cultural Please remember that past performance is not a guide to by the Company including those charged to capital, expressed as a percentage of the average shareholders' funds at the beginning and events future performance. The value of an investment and the l Priority pass for 600 end of the year. airport lounges income from it can fall as well as rise as a result of market and l Membership reward points currency fluctuations and you may not get back the amount Annual Growth to 31 July 2011 that can be cashed in at Links of originally invested. 2010/11 2009/10 2008/09 2007/08 2006/07 London, Sony and Molton Brown Share Price (Total Return) 17.54% 17.63% 15.23% -11.98% 46.47% Most of the investments in this portfolio are not made in l Travel service Net Asset Value (Total Return) 16.07% 19.44% 16.11% -13.90% 46.22% Sterling, so exchange rates could affect the value and income from your investment. Emerging markets tend to be less stable Source: All data sourced from Morningstar as at 31 July 2011, unless otherwise stated. The latest data is available on our website. COUTTS & CO WORLD CARD than more established markets and can be affected by local political and economic conditions, reliability of trading systems, BY BANK INVITATION ONLY buying and selling practices and financial reporting standards. APR: N/A This portfolio may hold a limited number of investments. If one (charge card) of these investments declines in value, this can reduce the ANNUAL FEE: £350 portfolio's value more than if it held a large number of investments. Some of the investments in this portfolio are in BENEFITS: smaller companies shares. They may be more difficult to buy l www.hendersontrpacific.com World concierge service and sell and their share price may fluctuate more than that of l Travel insurance larger companies. 0800 138 9133 l Continental car breakdown cover Ref: HPICA-01 l Priority pass for 600 Issued in the UK by Henderson Global Investors. Henderson Global Investors is the name under which Henderson Global Investors Limited (reg. no. 906355), Henderson airport lounges l Loyalty scheme that can be Fund Management Limited (reg. no. 2607112), Henderson Investment Funds Limited (reg. no. 2678531), Henderson Investment Management Limited (reg. no. 1795354), l Currency delivery service used to pay for flights and hotels Henderson Alternative Investment Advisor Limited (reg. no. 962757), Henderson Equity Partners Limited (reg. no.2606646), (each incorporated and registered in England and Wales with registered office at 201 Bishopsgate, London EC2M 3AE), Gartmore Investment Limited (reg. no. 1508030), Gartmore Fund Managers Limited (reg. no. 1137353), (each incorporated and registered in England and Wales with registered office 201 Bishopsgate, London, EC2M 3AE) are authorised and regulated by the Financial Services Authority to provide investment products and services. Telephone calls may be recorded and monitored. 24 Wealth Management | Institutional FX CITYA.M. 15 SEPTEMBER 2011 China lies at the heart of euro survival Chinese forex holdings are propping up the European single currency, writes Craig Drake

HE effects of speculation that China an imminent default – whatever form would be buying up Italian sover- that default will take – there has been a eign debt displayed just how much disconnect between a Eurozone that has Tsway the Chinese government been lumbering from one crisis to the holds over the world currency markets. next and the euro, which has held its own China has been accumulating foreign cur- against its major pairs. And it would seem rency reserves at a rapid rate – its forex that Chinese currency purchases have reserves increased by $750bn between gone a long way towards supporting the June 2010 and June 2011. It is reported that euro. “There is a strong element of China now holds more than $3 trillion in realpolitik from China,” says Hardy. China foreign currency reserves and has made has an interest in a healthy euro, and as a commitments to further euro-denominat- fully fledged economic big beast, is trying ed debt purchases in Greece, Spain and to use their purchasing power to defend Portugal. its interests. But its support certainly does- n’t come without strings. In a speech yes- REALPOLITIK terday, Chinese premier, Wen Jiabo, went So why is China buying up euro currency on manoeuvres saying that while China so heavily? After all, with the Eurozone will continue to expand its investment in project seemingly teetering on the the Eurozone, those countries must “put precipice, Europe doesn’t seem like the their houses in order.” At the speech to the safest of bets, but yet China now has more World Economic Forum he added that than a quarter of its forex holdings in “based on WTO rules, China’s full market euros. As John Hardy, consultant FX strate- economy status will be recognised by 2016. gist at SaxoBank points out, despite the If EU nations can demonstrate their sin- “awful” condition of the Eurozone, the cerity several years later, it would reflect Chinese authorities are always concerned our friendship.” Loaded words indeed, and about their exposure to the dollar. “The a stark reminder that if the Eurozone is to wrangling over the US debt ceiling and survive, it is the institutional foreign the S&P downgrade will have hit China exchange holdings of the Chinese govern- hard. China’s export economy is obviously ment that will play a key role in keeping it heavily influenced by the dollar, and what intact. This week will have reminded mar- is bad for the US is bad for China.” kets that in this arrangement, he who While Greek bond yields are pricing in pays the piper will call the tune. China now holds over a quarter of its foreign reserves in euros Picture: REUTERS

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Top business schools are increasingly looking at how companies can adopt models from celebrities, says Jeremy Hazlehurst

OOK along the business books sec- dom of complicated (and therefore mal- vation” from the pop star. “Lady Gaga is tion in a bookshop and you will find leable) books like Machiavelli’s The Prince, not just an incredible creative talent, she many tomes that promise to teach Sun-Tzu’s the Art of War and various bits is also a very astute business woman,” says Lyou how to invest like Warren Buffett of Nietzsche to turbo-charge your career. the school. or to learn from Bill Gates how a start-up The trend reached a high (or low) point can turn you into a billionaire. But along- with the recent addition of Mother Teresa, SOCIAL SKILLS side those you will also find another sub- CEO: Unexpected Principles for Practical At first sight this might simply be written genre of books that promise to re-purpose Leadership. off as a gimmick designed to pique the the wisdom of those who are strangers to Silly? Maybe. But now business schools interest of students (and journalists) but is the boardroom into business-friendly are also getting in on the act. The ESMT there anything to it? Martin Kupp, who advice. In 2009, the writer Robert Greene school in Germany has recently added a teaches the Lady Gaga course, says that There are rumours that rithms, have transformed the market- co-wrote a book called The 50th Law with case study about Lady Gaga to its MBA the shock of the new does play a part – Lady Gaga’s next proj- place for niche businesses. “I used to be a rapper 50 Cent, explaining how the musi- course. While stopping short of suggesting “after a while people get fed up with ect will be a self-help musician and have a thing for exotic jazz cian’s experiences of dealing drugs on the that students wear clothes made from Apple, Google and Facebook” – but that it album for investment guitar players who live in Manhattan. streets could be translated into corporate meat to interviews (as Gaga famously did is Gaga’s successful harnessing of social bankers These people have tiny audiences and in America. The shelves groan under the at an awards ceremony), it looks at what media that makes her relevant. She has former times they would have struggled weight of books that claim to use the wis- businesses can learn about “strategic inno- 10m followers on Twitter and 15m Picture: GETTY to make a living, having to do a lot of hack Facebook friends and her videos have work to survive. But courtesy of the web, been downloaded an average of 85m they can now reach a global audience, a times a month in 2011, and in the past tiny one to be sure, and sell all kinds of three years they have been viewed over a stuff that they wouldn’t have been able to FreeFFr entry! rreeee billion times. Traditional businesses before.” All sorts of small businesses could e which have failed to capitalise on social try – as indeed many already are – to har- een LLocationoccaation nnt media would be arrogant to assume that ness the same technology to reach a high- trttry rryyy! there is nothing to learn here. ly dispersed global audience of devoted  ! Of course, not everybody is convinced. enthusiasts, and a success story like Vince Mitchell, Professor of Consumer Gaga’s may help them develop a strategy Marketing at Cass business school, says that brings home the bacon. RReputationeputation that the point of a case study is to provide  “substantive learning which is generalis- PEER POWER able.” “Gaga is an extremely talented There are two essential reasons why Lady artist, that’s the main reason for her suc- Gaga is a worthwhile person – or phenom- AAccreditationccreditation cess, not the business decisions she enon – to study, according to Kupp. For a makes. So to examine her with a music start, one of the most important features  course is legitimate, to examine her with- of an MBA is learning from the experi- in a business school is not,” he adds. The ences of your peers. If they are bored by best people to learn from are “business- yet another discussion about Ikea’s brand- WhatWhat makesmakes youy tick? men who make business decisions and we ing or the South American mobile phone want to know how and why they took market, then maybe a bisexual pop star them. There are lots of great business riding a motorcycle might kick-start the entrepreneurs to learn from. I’m not sure conversation, especially as she is also very The AccreditedAccredited that artistic entrepreneurs have anything wealthy. more to teach a general business audi- But more importantly, Lady Gaga’s ence, unless it was on the curriculum of brand of outisde-the-box behaviour can MBAMBA FAIRF the Simon Cowell School of Business.” CREATIVE CONTROL LLONDONO N D O N 2011 That all sounds very commonsensical. But there is perhaps something to Gaga stud- SSatat 2222 OOctcctt 22011011 | PParkark PPlazalaza VVictoria Hotel, London, SW1V 1EQ ies. Jochen Runde, Director of the MBA programme at the Judge business school in Cambridge, says that musicians can 3 directdirect aaccessccess ttoo MMBABA aadmissionsdmissions oofficersfffificers teach entrepreneurs a lot about keeping 3 ffreeree bbriefingriefing ssessionsessions control of the product. “I watched some of the film about the preparation of 3 aaccreditedccredited pprogrammesrogrammes oonlynly Michael Jackson's last tour, and was sur- prised to see that he was dealing directly with his drummer on some of the most RRegisteregister nnow:ow: subtle stuff.” There might well be lessons www.mbaworld.com/mbafairwwwwwwww..mbawwoorld.com/mbaffaair here for small manufacturers that want to keep their identity (and keep up quali- ty) after they are bought by bigger corpo- SponsoredSponsored bby:y: rations. Runde also says that internet smarts are essential to benefit from the “long INSPIRINGINSPIRING GLOBALGLOBAL EXCELLENCEEXCELLENCE tail” opportunities that, together with online social networks and search algo- 27

teach students about the role of creativity. This is something close to Kupp’s heart, and he works with an artist in Berlin in order to think up new ways to inject cre- ativity into businesses – they recently worked on an art-project together, which involved business school students, and co- wrote a book called The Fine Art of Success which takes lessons for business from artists such as Madonna, Damien Hirst and Picasso. “There is a big need for companies to look at innovation and creativity,” Kupp says. “This is a big topic. People realise that the standard stuff they have learned only takes them so far, then they realise that it is about creative leadership and how to produce an environment where creativity can flow. There is a growing number of smart people coming from Asia and India, they are very well educat- ed, they are good mathematicians and engineers. The question is: what is our edge?” BREAKING THE MOULD Creativity is one of the major challenges facing business right now, thinks Kupp. As companies get bigger and more com- plex, they become good at standardisa- tion – a manufacturer might make 10,000 car-parts an hour to exactly the same spec- ification in factories all over the world – but they also need to be able to constantly re-think that product to stay competitive. Combining that consistency with creativi- ty in the same corporate structure is one of the big challenges of the early 21st cen- tury. Move over Mother Teresa, there’s a new business guru in town. And she’s wearing leather hotpants. 28 Business Features | Education CITYA.M. 15 SEPTEMBER 2011 How to teach that bribery doesn’t pay The lessons in ethics offered by MBA programmes are benefiting businesses, writes Jeremy Hazelhurst

ORRUPTION is a bad thing. the economy contracted by 7.9 per cent in Widespread bribery can reduce a 2009. And that really affects people’s lives. country’s GDP by up to 1 per cent, Corruption makes it harder for poor people Caccording to the World Bank. A tril- to get out of poverty, because they have to lion dollars is paid in bribes every year. A pay a lot of their income in bribes, and pre- decade ago, a quarter of Africa’s GDP was vents new businesses starting. paid in bribes. This isn’t just a problem for So what role can business schools play in poor countries. A report by helping to stamp out corruption? And, PricewaterhouseCoopers and market indeed, is that their job? Some certainly research company TNS-Enmid in 2007 think so. At the Skolkovo business school, found that German companies lost more just outside Moscow, that has been run- than €6bn a year through corruption, ning an MBA since 2009, anti-corruption is embezzlement and fraud. In 2006, a quar- a strong theme. The school is connected to ter of UK companies thought they had lost a technology park (the Russian Silicon a contract to a competitor who had paid a Valley, say cheerleaders) which aims to bribe in the previous five years, said a improve the country’s woeful track-record report by risk consultancy Control Risks. in innovation. In general, after the finan- Recently, the focus has been on India, cial collapse of 2008, business schools were with activist Anna Hazare going on hunger stung by criticism that the ideology they strike to protest against corruption in the pushed contributed to risk-taking. Since country, where there has been a series of then, schools have been keen to talk about high-profile cases of corruption. According their ethical credentials, and an anti-cor- to anti-corruption watchdog Transparency ruption stance is part of that. International, India’s poorest 400m people At America’s Tuck school, MBAs can pay a total of $200m a year. A total of $19bn attend “fireside chats” by convicted white- a year seeps overseas from India’s economy collar criminals, who explain how they got due to bribery. In Russia, the figure is said tempted and, importantly, how they were to be $300bn – a quarter of the country’s caught. (The speakers are provided by a GDP. That’s a problem in a country where public-speaking company called, wonder-

Stopping the brown fully, The Pros and The Cons.) Professor Rick form rubber-stamped obviously makes paper envelope Shreve, who oversees the ethics courses at things move more smoothly. Can corrup- Tuck, says that the school has a serious tion be a good thing? Picture: PHOTOSHOT commitment to producing “people with character” who wouldn’t consider corrupt CORRUPTION COSTS activity. “If we have got students for two Douglas Webber, a professor at Insead, years, we have to at last think about thinks such arguments are wrongheaded, whether we are a value-neutral or an inspi- simply because there are practical as well rational institution,” says Shreve. Acting as moral questions to be considered. “Once morally, then, is not about following a list a company becomes involved in corruption of rules, but being constantly aware of the it establishes a reputation for itself as being consequences of your actions and ethical amenable to bribery or blackmail, and you questions they might raise. “The code of keep on paying,” he says. Furthermore, gov- conduct is not just on the wall, it informs ernments are increasingly bringing in anti- the culture,” he says. corruption legislation – such as the Bribery Ethics is a big deal at the Spanish school Act in the UK. In India, the zero-rupee IESE, which is partnered with numerous movement hands the worthless notes out African business schools, and prides itself as a rebuke to those asking for bribes. There with its generally ethical and is a long-term move towards stamping out specifically anti- corruption. Until the late 1990s, bribes corruption were actually tax-deductible expenses in ethos. IESE’s Germany – no more. Webber thinks that Professor the shift in culture is driven by the democ- Antonio ratisation process that started with the end Argandona says of the Cold War. In secretive, authoritarian that an anti-cor- regimes, it is easier to keep bribes secret ruption stance than in democracies; and while in the past should infuse Western countries’ interests in African every class at a nations were restricted to keeping them on- business school. side against the USSR, these days we are Only by under- more concerned about development, standing the “cultural, political or econom- which means stamping out corruption. ic reasons” for corruption, and the legal Corruption abroad as well as at home is and other weapons to fight against it, such rapidly becoming unacceptable among as proper accounting, honest marketing respectable businesses. and good management, can corruption And anyway, says IESE’s Argandona, cor- really be defeated. ruption is not just illegal, or frowned-upon, or bad for reputation, but “a sign of the fail- CULTURE CLASH ure of the management of a company.” If a It’s easy for Europeans to lecture people in company’s executives allow corruption to other parts of the world where things are go on, they are simply not doing their jobs done differently. But is that naive? If kick- properly. “A corrupt company is a company backs and bribes are the way of the world, that is run poorly,” he says. It might be well, shouldn’t we go along with it? tempting to blame others – politicians, civil In some circumstances, corruption can servants, or competitors who take bribes – appear to improve economic efficiency. but that is always an excuse for poor man- There is often a reason that corruption agement. Reputable and successful compa- exists beyond the venality of officials. In nies simply do the right thing. If that’s true, countries with weak market institutions then it’s not NGOs or governments or the and a bureaucratic culture that hinders World Bank that are in the front line business getting done, then a so-called against corruption and all its evils – but “speed bribe” to jump the queue and get a business schools. TINKER TAILOR 29 SOLDIER SPY | Books JOHN LE CARRE’S BOOK IN Lifestyle FILM, REVIEW ON FRIDAY Norwegian bestseller is just alright

Jo Nesbo swept to worldwide fame with The Snowman, but his latest is a bit disappointing

Jo Nesbo is However, Nesbo’s departure from the troopers. the history of England, most notably Lord HEADHUNTERS Norway’s (living) Harry Hole formula results in a novel lack- Nesbo’s book has been a roaring success Macaulay’s enthralling work and David answer to the ing the tight pace, suspense and colourful in Norway, with recent confirmation of a Hume’s six volume masterpiece. Peter BY JO NESBO Swede Stieg palette of unsavoury characters that made film within the year – however one can’t Ackroyd – whose recent work on Harvill Secker, £11.99 Larsson, author of previous works household names. help but feel that he has missed some- London’s history is one of the best ever the Millenium Trilogy. Moreover, the only characters explored thing here. Too much emphasis is placed produced – is mimicking Hume, with the hhhii to any extent are the lead Roger Brown on Roger being a sleaze at the expense of first volume, in his six volume The and the victim/enemy Clas Greve. Roger’s both plot and other characters. When History of England, just out in bookshops. wife, Diane, is left mostly mute: the only towards the end some form of redemption Sadly most of us won’t have the time to ORWEGIAN Jo Nesbo shot to UK discernible fact being that she has veins is created, it feels hollow. plough through six volumes on the histo- prominence in 2010 with The that stick out on her forehead during sex Perhaps Harry Hole was the better candi- ry of England until we retire, which is a Snowman. This was quickly fol- and has loud and frequent orgasms. date for the job after all. good reason to turn to Sir Simon Nlowed by what is considered his best Roger’s love interest meanwhile is left Alasdair Byers Jenkins’s A Short History of England. work: 2011’s The Leopard. Both feature almost totally blank – and generally paint- The chairman of the National Trust has Detective Harry Hole, a flawed yet brilliant ed as a socially inept extra – not in any A SHORT long been a distinguished defender of detective who operates in the Norwegian way equipped for the somewhat pivotal England’s finest institutions and reforms underworld. role she plays in the closing chapter of the HISTORY OF ENGLAND as well as sharp critic of its less welcome Headhunters is a departure from the book. BY SIMON JENKINS corruptions. Although a defender of tradi- series. Already sitting at No1 on the Clas Greve quickly becomes a comic- tions, Jenkins’s work is not in the least bit Norwegian bestseller lists it follows execu- book villain in his relentless, increasingly Profile books, £25 jingoistic, presenting a balanced view of tive headhunter Roger Brown, who uses tiresome pursuit of Roger – including at the story of England. his art-patron wife’s connections to different points stabbing him in the but- hhhhi The principal figures and events that arrange interviews for CEO-level candi- tocks and relieving himself on Roger’s moulded this country are reflected dates – all of whom happen to be art col- head. A FASCINATION with this country’s capti- upon: from the Saxon dawn, through lectors – and then proceeds to burgle their In addition – as flattering as it may be to vating history is something that is almost kings and queens, the rise of parliamen- homes whilst the candidate interviews any recruiter that reads this, it seems crushed out of most school children – but tary power, right up to Thatcher and her elsewhere. This system has worked for unlikely that a headhunter could be so only almost. successors. some time, until Roger comes up against a incredibly influential that major business- The television channels, programmes, Dip into a chapter of an evening and let candidate with an ex-special forces back- es feel the need to assassinate them. In my magazines and books devoted to history Jenkins sweep you through England’s his- ground – who later ends up joining a con- experience most recruiters would be shows that the subject looms large in peo- tory, painting a vivid picture of this coun- spiracy to remove Roger from his position grateful if a client returned their call, ples’ imagination. try’s green and pleasant land. of kingmaker. never mind bringing in Norwegian para- Many a great book has been written on Philip Salter Lifestyle | Food

FOOD & BOOZE NEWS September is a month of hot openings ZOE STRIMPEL

BILLINGSGATE FISH MASTERCLASS BERLUSCONI PIZZERIA OPENS it’s complete with stunning marble clad Cup (Babicka vodka with parsnip purée, Fish lovers who work in Canary Wharf have Bunga Bunga, the Berlusconi-referencing, brasserie restaurant, a sumptuous first coconut and vanilla syrup, lemon and gin- a treat in store on Friday 30 Sep, when Italian tongue-in-cheek pizzeria, bar and floor lounge bar, verdant courtyard gar- ger served in an absinthe rinsed glass) fine-dining Plateau’s chef, Allan Pickett, will karaoke hotspot in Battersea has opened. If den with smoking terrace, drawing while sampling the delicious oriental be taking a fish masterclass at Billingsgate that’s not mouthful enough, go along to the rooms, a nightclub-come-live music treats on offer. A little higher above Market. During a jolly and informal evening, place itself and stuff yourself on surprisingly venue in the basement and a striking con- street level, in the City/Spitalfields bor- Allan will show you how to make two fish accomplished, well put together pizzas and all TIM temporary art collection throughout that ders, the Sky Lounge also launched last dishes – shallow fried plaice fillets with sorts of meats from Italy that are found on BADHAM would give leading galleries a run for their week, situated on the thirty-second floor French beans and almonds and nut-brown antipasti boards. Bunga Bunga is destined to GOING OUT money. Put your best artistic foot forward of the Nido building on Frying Pan Ally. butter sauce, become the dar- if applying for membership. This new sky-scraping bar features and roast fillet ling of the Senkai quietly launched last double-height ceilings of floor-to ceiling of sea bass, Battersea and Wednesday and is set to become a desti- windows which present stunning 270 olive oil and Chelsea crowd, HIS week saw one of London’s nation hang out overnight. This new degree views from the Olympic Park and herb dressing. and others may most auspicious and historic pri- Japanese restaurant and lounge bar from Tower Bridge across to the Gherkin and Then, of well be lured by vate members’ clubs magnificent- the Ignite Group (Boujis and Wyld) has St Pauls. The bar is great, but it’s the course, you’ll its unique Tly unveiled. The Arts Club has perfectly reinvented the old Cocoon site views that are the real star and are even sit down and promise of fun, reopened on Mayfair’s Dover Street and on Air Street by Piccadilly. Still sleek and more impressive from the mezzanine bal- enjoy your evening’s work with a glass or singing and really good food. 37 Battersea looks set to take the Big Smoke by storm. stylish but the complete overhaul is more cony above. You can walk in but booking three of wine. A great chance to be part of Bridge Road, SW11 3BA. Tel: 020 7095 0360. Founded in 1863 by a small group of subtle and natural with pale woods and a table is advisable and on Thursdays and the action of one of London’s most famous friends including Dickens and Trollope; serene hues giving it an exclusive and Fridays there’ll be DJs to spin beats till food markets, with a Canary Wharf foodie HERON TOWER’S DRIFT GOES AUTUMANL this most recent incarnation is likely to exotic hideaway impression. The famous late. Tim Badham is the founder of star. Friday 30 September from 18:30- Think gorgonzola, walnut and rocket salad attract an equally eminent modern alum- circular central bar now feels much more Innerplace, London’s leading specialist 21:30 at Billingsgate Seafood Training with pears, paprika and honey and rocket and ni with the help of Mark Ronson as spacious and the new cocktail lounge VIP entertainment Concierge School, Billingsgate Market, E14 5ST. butternut squash salad with Machego cheese, Musical Director and Raphael Duntoye means you can enjoy sipping Nipponese www.innerplace.co.uk. Nominated for Places are £85 per person and the class or go liquid with Dorado rum and the Skinny (of Zuma and La Petite Maison fame) as inspired concoctions whilst overlooking best Concierge in the London Lifestyle size will range from 12-14. For more infor- Bakewell Sour. The new menu is a real taste of Chef Director. Occupying a grand and the hustle and bustle of Regent Street Awards. To vote please go to london- mation or to book, call Billingsgate Seafood the season. Side entrance, the Heron Tower, sprawling Georgian Mayfair townhouse, below. Try their signature, the Parnsip lifestyleawards.com/vote.php Training School on 020 7517 3548. thedriftbar.co.uk 30 Lifestyle | Technology CITYA.M. 15 SEPTEMBER 2011 Pocket watch: Gizmos for taking the next films with you generation

HOUGHT the pocket watch was a gadg- et relegated to history? Think again. Of late two of the most cutting edge Swiss on the move Twatch companies have announced new pieces designed to be worn on a chain rather than on the wrist. The first, by Urwerk (www.urwerk.com), Mobile storage devices are now more a brand that specialises in futuristic timepieces that bear only the slightest portable, affordable and useful, relationship to our traditional notions of what watches says Andrew Carrier should look like, is an object at the most extreme end of IZE isn't everything” – an inaccu- horological design. rate platitude typically uttered Titled the Zeit by those whose equipment is Device Uber Slacking in some way. Complication, it That’s right, folks, we’re talking looks like about mobile media storage solu- something tions. And in this game, the length of from far into your battery life and the girth of your is the Kingston Wi- buy it from AirStash.com the future – storage capacity are kingmakers. Drive (£99.95 for 16GB or for $99. You’ll have to add shipping and and indeed, It’s no longer just music collections £139.95 for 32GB from the cost of your SD cards of course. it’s we want to have on tap from our mobile Widrive.co.uk). Unlike other My favourite, however, is the Seagate designed devices. Anyone who’s ever traveled long- devices, you can’t expand the stor- GoFlex Satellite 500GB (£187.90 from to still be haul, especially with small children, age beyond its 32GB maximum. Three Amazon.co.uk). It’s on the bulky side, I running in a knows the appeal of having access to the Clockwise from top: people can use it simultaneously though grant you, but with good reason: it has far thousand years, Crown Jewels of their entertainment the Airstash; the which might be handy. And, unlike its and away more storage than any of its and has a repertoire: an extensive film collection. Seagate GoFlex competitors, it also enables you to use the competitors. With 500 GB of capacity, it’s millennial indicator That’s where a new crop of mobile Satellite; and the internet while connected to it. got room for hundreds of films and enjoys just to point this out. To media storage devices come to the rescue. Kingston Wi-Drive. a pretty decent five hours of battery life. ensure it gets there, it’s also got an These nifty little gadgets can store movies SUPERIOR SOLUTION Oh, and it uses the very fast new USB 3.0 oil change indicator to remind you to send it and stream them directly to your iPhone A superior solution in my eyes is the standard to load up your files in the first back to Urwerk for a five yearly service. or iPad using their own Wi-Fi network and AirStash. It’s very small, light and only has place. Above and beyond that, there’s a whole dedicated iOS apps. Once up and running, one button. Crucially, it accepts SD cards, Size, it turns out, is everything. But host of functions and complications you can put them away and forget about so you can brings as many as you want you’ve never said otherwise, right? squeezed into the titanimum-aluminium them. Very elegant. with you. Battery life is about five hours. The author is the editor-in-chief of luxury lifestyle alloy case. These include the Urwerk’s One of the smallest and most affordable No word on UK availability yet but you can magazine TheProdigalGuide.com highly-innovative revolving calendar and revolving hour display, which is fixed to a retrograde minute hand. While there’s no word on the price as yet, expect it to be astronomical, as this is just about as A menswear brand with technological edge advanced a mechanically-powered timepiece as can be found. Urwerk is only going to make eight Zeit Devices, TEP into menswear brand Alfred Dunhill’s London “home”, so potential owners are Bourdon House on Davies St in Mayfair, and you enter a world rather more likely to keep of heritage and urbanity – polished leather and wood, old- them stored in their Sfashioned stylings, gentlemanly deference and proper tai- most secure safes loring. There’s even an attached gentlemen’s club that’s rather than in their strictly invitation only. All very classy, but let’s just say it does- pocket. n’t exactly suggest forward-thinking techy innovation. More likely to be As it happens, though, Dunhill’s a menswear brand worn on a chain that’s rather fond of its groovy gadgets – the company’s with a smart popularity in tech-mad Asia no doubt has something to three-piece suit is do with it. Earlier this year it brought out a biometric this retrotastic wallet – a wallet made of carbon fibre that can only be pocket watch, the opened by recognising its owner’s fingerprint – and a PW1, newly stylish solar charger for phones and gadgets. released by Bell & Its latest gizmos are some high-end headphones Ross (www.bellross.com) a and a very cool mini-projector. The latter tool can company ironically known for its highly screen presentations, images and films over a 60 inch contemporary aviation watches. This year screen size – perfect for business meetings done on the Bell & Ross has gone on a vintage tip with hoof. Its leather case also doubles up as a small screen. watches inspired by World War I pilots, For the headphones, Dunhill’s partnered up including this little beauty. with audiophile brand Denon to create superior noise-cancelling cans that will make you the envy of For more on cutting-edge watches, fellow commuters. see the next edition of the City A.M. www.dunhill.com Both items are £595 from www.dunhill.com. watch supplement, London Time, Timothy Barber on Friday 30 September. OUT OF OFFICE TIMOTHY BARBER

Left, Anthony Sher BROKEN GLASS AT THE VAUDEVILLE FOOD, CHEFS, FILM LONDON JAZZ FESTIVAL and Tara Fitzgerald Arthur Miller’s play Broken Glass, which To coincide, three top hotels are host- One of the capital’s most diverse are starring in Broken reflects on the American Jewish experience ing foodie film screenings intro- music events, the London Jazz Glass. during the Nazi ascendancy in Germany, sees duced by top chefs, along with Festival, returns this November. the return to the London stage of two of the Q&As and three course dinners. Bill Highlights to book tickets for now country’s finest actors, Anthony Sher and Granger (right), Laura Santtini include a rare London perform- Tara Fitzgerald. After reading about the and Lucas Hollweg are on board ance from the majestic Cape events of Kristallnacht, Fitzgerald’s character to introduce Eat Drink Man Verde songstress Cesaria Evora, Sylvia is rendered paralysed. Until 10 Woman, Waitress and Chocolat at an appearance by vocalist and December, Vaudeville Theatre, WC2R 0NH. the Soho Hotel, covent Garden Hotel harpist Lucinda Belle . Information, Tickets £22.70-£47.50 from and Charlotte Street Hotel. Tickets £55. dates and prices can be found at www.nimaxtheatres.com More info: www.firmdalehotels.com www.londonjazzfestival.org.uk.

32 from 1 to 9 to solve Sudoku puzzle. this tricky numbers the all contains block 3x3 each and column row, each Place the from 1 numbers to 9 in each empty cell so that each SATELLITE & CABLE TERRESTRIAL   QUICK CROSSWORD ROOT H LAST ISSUE’S COVEN APOGEE SHREW A Y THUG T T SOLUTIONS FEZ BBC1 World 2am-5am 12am 11pm Club Rugby Golf 7pm 3 SPORTS SKY 7pm 2 SPORTS SKY 11pm 8pm 7.30pm 7pm 1 SPORTS SKY 4.30am Access 12am 10pm 9.30pm League Rugby Championship Supermen 4.30am-5am League Rugby Championship rme egeWorld League Premier Burning FILM 11.35pm 10.35pm 10.25pm 10pm Day Miracle odTrip Road Scroungers and 2.15am Panorama – Stories Survivors’ 1.45am 9pm 8pm 7.30pm 7pm 6.30pm 6pm Lifestyle |TV&Games     V LAMPREY G EDO T 8pm uoenCalneTour Challenge European Fulltime NRL Seven at News Sports Sky iePieihe Boxing Prizefighter Live h n Show One The CHOICE B News BBC Watchdog aisErpa orGolf Tour European Ladies ieo u Lives Our of Time uoenTu Golf Tour European W:NXT WWE: W:Lt ih Raw – Night Late WWE: 1.30am B News BBC 2am Countryfile inZn:Tuai The Tsunami: Zone: Sign rme egeWorld League Premier    ue egesSupermen League’s Super ub Club Rugby ; atnes B News BBC EastEnders: NIMROD H E E T LOU B odnNews London BBC 4.25am-6am oia Weatherview Holiday iePATu Golf Tour PGA Live G orGolf Tour PGA usinTime Question einlNews Regional ABOVE SALVO 1am SUDOKU R Fulltime NRL M O ue League’s Super EPEE PUMA THY rzfgtrBoxing Prizefighter    3.40am Torchwood: rme League Premier E Mississippi 1am 7.30pm 3.10am 5.30am-6am A B K Y L     COFFEE BREAK F:Total NFL: B News BBC 12am Antiques 2.30am Live Saints    The Copyright Puzzle Press Ltd, www.puzzlepress.co.uk 1 1 4 4 9 9 8 2 71   17 4 6 25 2 7 3 3 5 Close 1.05am 12.20am Story Saira’s 11.20pm 10.30pm Donnelly. 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SPORT | IN BRIEF

Surrey back in Division One qualifying for Euro 2012. But Redknapp CRICKET: Surrey have gained promotion said: “Until I get offered the job I would- back to Division One of the County n’t have a decision to make, but at the Championship after completing victory moment I haven’t spoken to anybody over Derbyshire by an innings and 126 about being England manager. I want to runs. Spinner Pragyan Ojha then took 6- see England do well, I want Capello to 42, to finish with match figures of 10- get them to the Euros and I want them 90, as the visitors crumbled to 152 all to win it.” Points Jersey. out. Surrey’s 24 points means that they finish one point above Northants. Hushovd wins in Wales CYCLING: Norwegian world road cham- Redknapp quashes England link pion Thor Hushovd won stage four of the FOOTBALL: Tottenham manager Harry Tour of Britain from Welshpool to Redknapp has denied he has held talks Caerphilly. The Garmin and Cervelo rider Swann will captain with a view to becoming the next edged out stage three winner Lars Boom. the T20 side against England boss. Speculation over the Russell Hampton retained the King of the the West Indies weekend suggested the FA was ready to Mountains Jersey, while Boom has the dismiss Fabio Capello following the Points Jersey. Stage five runs from Picture: PA abject display against Wales, which iron- Exeter to Exmouth today before the ically took England to within a point of Taunton to Wells leg tomorrow. Swann proud of chance to lead England

▲ ular personality amongst his team- CRICKET mates, but he acknowledges he’ll BY JAMES GOLDMAN have to adopt a slightly more conser- vative approach in his new position of ENGLAND spinner Graeme Swann enhanced responsibility. revealed his most difficult task since “I’m very much the joker in the being handed the captaincy of the Test side,” he said. “I’m there for a stu- Twenty20 side was keeping the pid quip at the end of the session – appointment a secret for two days. that’s part of my role. With regular skipper Stuart Broad “But that’s a very settled side, with set to miss the double header against everyone knowing their place. With the West Indies next week with a this Twenty20, I’d naturally have to shoulder injury, England have turned be more grown-up and mature about to the Nottinghamshire twirler. things anyway.” “I was desperate to phone my mum In the absence of Broad and his fel- and dad up a couple of nights ago, low shoulder injury victim and offi- but I couldn’t,” he said. “That’s been cial vice-captain Eoin Morgan but also the hardest thing for me over the last the rested Kevin Pietersen – and no 48 hours - keeping it to myself. return yet to the shortest format for “Andy Flower asked me a couple of one-day international captain nights ago at the ICC dinner whether Alastair Cook – there is a decidedly I’d step in as the interim captain youthful look to England’s group of while Broady has his bad shoulder. Twenty20 hopefuls. “You’re always very honoured Swann said: “It’s obviously a case of when things like that happen, and being fairly mature in the changing I’m no different. It was a little bit of a room, because we’ve got a few young surprise. But if truth be told I’d guys who’ve not played before and looked at the likely squad and need to have at least a semi-sensible thought ‘I might have a chance role model to look up to. here’.” “But I’ll be looking to still inject my Swann’s jovial and self-deprecating own brand of energy into the team, manner has made him a hugely pop- and hope that will come off.” Results L<=8:?8DG@FEJC<8>L<>IFLG8 >iflg9 DXe:`kp%%%%%%%%%%%%%%%% '  ( EXgfc`%%%%%%%%%%%%%%%%%%%%%%%%% '  ( =::fg\e_X^\emMfijbcX -gd #?Xeefm\i0-mJkXe[Xi[C`\^\ -gd % BfcXifm., :XmXe`-0 >iflg:1?Xgf\cK\c$8m`mmIXg`[9lZli\jk` -gd #GJM  8kk1++#')- <`e[_fm\emC\^`XNXijXn -gd % M`ccXii\Xc%%%%%%%%%%%%%%% '  ' 9Xp\ieDle`Z_%%%%%%%%%% (  ) >iflg;1=:Qli`Z_mJgfik`e^C`jYfe -gd #CXq`fm=:MXjcl` >IFLG9 -gd % @ek\iD`cXe%%%%%%%%%%%% '  ' KiXYqfejgfi%%%%%%%%%%%%%% '  ( >iflg<19\j`bkXjmDXZZXY`K\c$8m`m -gd #;peXdfB`\mm C`cc\%%%%%%%%%%%%%%%%%%%%%%%%% (  ) :JB8DfjZfn%%%%%%%%%% '  ) Jkfb\ -gd % >iflg=1GXi`jJ>mJXcqYli^ -gd #JcfmXe9iXk`jcXmXm >IFLG: 8k_c\k`Z9`cYXf -gd % 9Xjc\%%%%%%%%%%%%%%%%%%%%%%% (  ) Fk\clc>XcXk`%%%%%%%%%%%%%% '  ( >iflg>18Q8cbdXXimDXcdf==#=B8ljki`XM`\eeXm 9\e]`ZX%%%%%%%%%%%%%%%%%%% (  ( DXeLk[%%%%%%%%%%%%%%%%%%%%%% (  ( D\kXc`jkB_Xib`m% :Xi[fqf)+ >`^^j+) >iflg?19`id`e^_Xdm9iX^X#:clY9il^\jmDXi`Yfi%  8kk1,0#-.( >iflg@18kc\k`ZfDX[i`[m:\ck`Z#L[`e\j\mI\ee\j /%', % >IFLG; >iflgA1DXZZXY`?X`]Xm8iflgB1=lc_Xdm=:Kn\ek\#N`jcXBiXbfnmF[\ej\% ;`eXdfQX^i\Y%%%%% '  ' I\XcDX[i`[%%%%%%%%%%%%%%% '  ( >iflgC18e[\ic\Z_km8iXqmCfbfdfk`m DfjZfn% KF;8PËJ;@8IP IL>9PC<8>L< =ffkYXcc/%',gdlec\jjjkXk\[ K_\:f$fg\iXk`m\:_Xdg`fej_`gGcXpF]]J\i`\j .%*' 1 =\Xk_\ijkfe\mC\`^_% @ek\ieXk`feXcDXkZ_18i^\ek`eXm9iXq`c (%,' % iflg81G8FBJXcfe`bXmKfkk\e_Xd IL>9PLE@FE -gd #J_XdifZbIfm\ijmIlY`eBXqXe -gd % Nfic[:lgGffc: /%*' 1Iljj`XmLJ8% email [email protected] 34 Sport CITYA.M. 15 SEPTEMBER 2011 Empty seats are cause to revisit Chelsea strategy

lenge under the leadership of a new against another but my instinct is dance for that match will sink below feel far less like the place to be (which manager, should have felt like a that the stadium would have been that of Tuesday night. is not optimal when the club is trying grand occasion. A 2-0 win meant it all much fuller if Chelsea had not decid- With most spectators (juniors, pen- to sell naming rights for the ground). went passably enough but it was diffi- ed to increase prices for European sioners and corporate hospitality For a club like Chelsea, the qualify- cult not to notice the banks of empty group stage matches to £40. Two aside) paying £40 a head, the receipts ing stage of the Champions League seats as Stamford Bridge witnessed its years ago, it cost a very reasonable for the Leverkusen match would have has become a touch too predictable worst attendance for several years. £30 a head and Chelsea were reward- been around £1.3m. The Fulham also. It would be highly unlikely if Even cup matches against the likes ed with full houses for every match. Carling Cup match will probably net they failed to qualify for the next of Ipswich and Cardiff have attracted around £1m at the lower adult prices stage, so the interest in the opening FOOTBALL FINANCE COMMENT 40,000-plus crowds to the ground (as REVENUE GAIN of £25. So there is a definite revenue group stage is not as great as a few next Wednesday’s visit of Fulham in Some fans, annoyed by the price gain in charging the higher prices years ago when they first embarked DAVID HELLIER the lower grade Carling Cup surely increase, are already planning a boy- even with the lower crowd figure. on European adventures. will), whereas the Bayer Leverkusen cott for the match against unfancied But a less-than-full stadium looks Chelsea have done well to price HELSEA’S Champions League contest brought fewer than 34,000 Genk. Whether it amounts to much – so much worse for the TV cameras their domestic cup matches realisti- match on Tuesday night, when paying spectators through the turn- football fan boycotts rarely do, (the Leverkusen match was live on cally but if the Leverkusen match is the club welcomed back an old stiles. because most supporters are so loyal Sky Sports), the atmosphere is less anything to go by they might wish to Clegend in Michael Ballack as It is always difficult to say exactly they would never miss a match – it big-time inside the ground and the next season revisit the pricing deci- they kicked off their European chal- why one match is under-attended would seem likely that the atten- empty seats make Stamford Bridge sion for the Champions League.

Giggs has now KEY MOMENTS | RYAN’S RASPER scored in a record 16 different Champions Golden Giggs League seasons to the rescue Picture: PA

27 mins: Benfica capped their spirited open- for Ferguson ing with a fine goal. Jonny Evans will feel he was turned too easily by Oscar Cardozo, but the striker’s finish was worthy of praise. dilemma in choosing between the BENFICA 1 Dane and De Gea in goal against Chelsea this weekend, Ferguson said: “No, not at all. David de Gea will play MANCHESTER UTD 1 on Sunday. That was the understand- ing we had before the game, and it

▲ doesn’t change. FOOTBALL “I don’t know why you ask these BY JAMES GOLDMAN questions, you’re just looking for stu- pid little things. Anyway, it proves we MANCHESTER UNITED manager Sir have two terrific goalkeepers.” Alex Ferguson reacted angrily to sug- Lindergaard earned United a point gestions that last night’s inclusion of with athletic late saves from Nicolas goalkeeper Anders Lindegaard at the Gaitan and substitute Nolito, but had expense of David de Gea indicated he no chance with Cardozo’s 24th 41 mins: Ryan Giggs became the first player was losing patience with the minute opener. to score in 16 different Champions League Spaniard following last night’s The outstanding Gaitan lifted an seasons when his solo run culminated in a Champions League draw in Lisbon. extravagant pass with the outside of shot which nearly broke Artur’s net. Oscar Cardozo fired Benfica into a his right foot over the United defence deserved early lead but a blast from and into the path of Paraguay for- the evergreen Ryan Giggs shortly ward Cardozo, who twisted past before half-time ensured a much- Jonny Evans and located the far cor- changed United side escaped with a ner with a rasping drive. point. That effort was made to look posi- Ferguson made eight alterations to tively tame by Giggs four minutes the team which brushed aside Bolton from the break, however, when he last Saturday, but it was the omission collected Antonio Valencia’s pass, of £17m summer signing De Gea, shuffled past several challenges and who has made a series of high-profile detonated an unstoppable shot into errors since his switch from Atletico the top left-hand corner. Madrid, which raised eyebrows. The Scot, however, dismissed sug- gestions he had dropped the 20-year- GROUP C TEAM PLD W D L F A PTS old as nothing more than mischief 66 mins: Anders Lindegaard, in his first making and confirmed he would FC Basel 1 1 0 0 2 1 3 United appearance since February, got down restore De Gea to the starting line-up Man Utd 1 0 1 0 1 1 1 well to prevent the onrushing Nolito and later against Chelsea on Sunday. Benfica 1 0 1 0 1 1 1 clawed away Gaitan’s left-footed curler. Asked whether the impressive Lindegaard had given him a selection Galati 1 0 0 1 1 2 0 Luiz champions improving Torres Arteta up for the cups ▲ FOOTBALL their Champions League group cam- speculation about his future at ▲ FOOTBALL champions Borussia Dortmund on BY FRANK DALLERES paign off to a winning start. Stamford Bridge this week, despite BY JAMES GOLDMAN Tuesday, and believes he has seen “Fernando had a very good game, only joining the club in January. enough from his new team-mates to CHELSEA defender David Luiz has two assists, and it is difficult because Winger Florent Malouda added: “It ARSENAL midfielder Mikel Arteta be sure a six-year wait for a trophy backed Fernando Torres to put his dif- the people all the time speak about is difficult when you can see people believes his new club have the quality will soon be over. ficulties behind him after the goal- him,” said Luiz. “It is big pressure in focusing on one player in the squad. I to end their trophy drought. He said: “The challenge here is to shy striker played a key role in the head, but Fernando is a good guy think the whole squad work hard The Spaniard, a deadline day sign- win trophies and at Everton I didn’t Tuesday’s win over Bayer Leverkusen. and I know this season he will score every day in training and I think ing from Everton, helped the have the chance to do that. Hopefully, Torres, who has scored just once in many, many goals.” Fernando is working very well. I Gunners begin their Champions we are going to have it here. We all 22 Blues games, set up both goals in a The performance was a timely fillip would say we need to be patient, he League campaign with a highly cred- need to be together and we have to 2-0 win as the west Londoners got for Torres, who has faced increasing works very hard for the team.” itable draw at the home of German make sure we are close.” CITYA.M. 15 SEPTEMBER 2011 Sport | Rugby World Cup 35

THE BREAKDOWN | Scotland zero WORLD CUP BRIEFS CANADA TAME TONGA Canada produced the first shock of the World Cup as they enjoyed a 25-20 win over Tonga in Whangarei. Canada led the Pool A in on decider clash 10-7 at half-time through Jebb Sinclair’s converted try with Siale Piutau replying before the break, but Canada stunned the favourites with two tries in the last 12 minutes to record a famous against Pumas victory. SAMOA THRASH NAMIBIA A hat-trick from Alesana Tuilagih The key for us was to win the game. I helped Samoa record an emphatic SCOTLAND was delighted with the way the play- 49-12 win over Namibia in a one- 15 ers played, right across the board,” sided Pool B encounter. Kahn said Robinson. Fotuali’i and Paul Williams also GEORGIA “I set the target that when we left crossed, while Samoa were award- 6 Invercargill [after the first two games] ed a penalty try in the second half. we wanted nine points. We’ve Tusi Pisi added 10 points before

▲ limping off with Williams adding RUGBY UNION achieved that and the guys stuck to a very good plan today. I thought the a further nine points from the BY FRANK DALLERES front five were outstanding.” boot. Back-row Kelly Brown was the SCOTLAND coach Andy Robinson pick of an outstanding Scottish pack, HABANA SIDELINED toasted his team’s battling qualities although there was little in the way South Africa winger Bryan after a hard-fought victory over of attacking threat, leaving Habana (inset) has been ruled out Georgia kept them on course to main- Robinson’s men to rely on the boot of of Saturday's Pool D match tain their record of reaching the Parks. Georgia were first on the score- against Fiji because of a knee knockout stages of every World Cup. board with the first of two Merab injury. And the Springboks could Fly-half Dan Parks kicked all the Kvirikashvili penalties but Parks also be without Johann Muller points, with four penalties and a drop replied with two of his own and a after the Ulster lock goal, as Scotland’s front-five out-mus- drop goal, plus a second-half penalty. injured his ham- cled the notoriously grizzled string in train- Georgian pack to make it two wins ing. “Bryan from two in Pool B. POOL B sustained a It puts them on nine points, follow- TEAM PLD W D L BP PTS Petallar ing the defeat of Romania in their Scotland 2 2 0 0 1 9 Tendon injury opening match, and leaves their next England 1 1 0 0 0 4 during last fixture, against Argentina a week on Argentina 1 0 0 1 1 1 week’s match Sunday, looking increasingly like a and will not be second-place play-off. Georgia 1 0 0 1 0 0 considered for “Some days you’ve got to win ugly. Romania 1 0 0 1 0 0 selection,” said team communications manager Andy Colquhoun. With Bakkies Botha (Achilles) and Victor Matfield (hamstring) also struggling, the defending champions have issues Ireland in Flannery blow to deal with in the second row, too. CENTURY UP FOR MCCAW

▲ drafted Damien Varley into the squad New Zealand captain Richie RUGBY UNION in his place, while Sean Cronin will McCaw is set to become the first BY FRANK DALLERES fill in for him among the replace- player to rack up 100 appearances ments in the forthcoming crunch for the All Blacks after being IRELAND’S World Cup hopes suffered game against Australia. named in the side for the Pool A a blow yesterday when hooker Jerry Munster forward Flannery faces an clash with Japan in Hamilton Flannery was ruled out of the rest of uncertain future, however, having tomorrow. McCaw will lead a side the tournament. suffered from calf problems for much Parks kicked all that shows eight changes to that Flannery, who came off the bench of the last year. of Scotlands which beat Tonga 41-10 in the in the opening-match victory over the Ireland face Australia at Eden Park points tournament opener in Auckland. United States, is facing a six-week lay- in Auckland on Saturday in their sec- Star fly-half Dan Carter will be off after tearing a calf muscle in train- ond match in Pool C. They beat the US Picture: ACTION rested after he picked up a slight ing. Ireland coach Declan Kidney has 22-10 in their opener on Sunday. IMAGES back problem. 36 CITYA.M. 15 SEPTEMBER 2011

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Selfish City KEY MOMENTS | ITALIAN JOB are stalled on

49 mins: Both sides strike the woodwork in a pulsating first-half, but Napoli come closer still their big night four minutes after the break when Vincent Kompany clears Marek Hamsik’s volley off his own goal line.

that vein, when Samir Nasri fizzed a MANCHESTER CITY 1 snapshot inches wide and the recalled Edin Dzeko forced Morgan de Sanctis to make a fingertip save within the NAPOLI 1 first 15 minutes. But it was Napoli, whose attacking

▲ trio of Marek Hamsik, Cavani and FOOTBALL Ezequiel Lavezzi is widely coveted, 69 mins. Napoli’s threat on the break earns BY JAMES GOLDMAN who almost took a shock lead when them the lead. City lose possession, Maggio the latter turned City skipper Vincent drives forward and feeds Cavani, who ruth- MANCHESTER CITY manager Roberto Kompany and guided a shot towards lessly finishes to put the other Champions Mancini accused his players of put- the top-right corner, only to hit the League debutants in front. ting personal glory before the team crossbar. after Napoli held the Premier League Back down the other end, a Yaya pace-setters to a draw on their Toure effort went the same way Champions League debut. before half-time, but the Italians City needed a free-kick from bared their teeth again straight after Aleksandar Kolarov to rescue a point the break when Hamsik’s volley from from their first match against an acute angle beat Joe Hart but was Europe’s elite for 43 years, after cleared off the line by Kompany. Edinson Cavani had put the Italians And Napoli made the break- ahead midway through the second through on 69 minutes when City lost half. possession, Christian Maggio charged 75 mins. Just seconds after Aguero had come A compelling, open game might 40 yards and fed Cavani, who drilled a within a crossbar’s width of equalising, have yielded more goals – City hit the low finish under Hart. Kolarov steps up to a free-kick on the right bar twice and Napoli once – and an Aguero was inches away from level- flank and expertly curls it over the wall and otherwise content Mancini admitted ling moments later, when he touched inside the near post. to frustration at his team’s failure to Nasri’s cross onto the bar, but Kolarov make more of their possession. succeeded where he failed 15 minutes “Maybe some players wanted to win from time with a dipping free-kick. the game on their own because we Dzeko might even have won it but played one touch too many in the first spun and shot wide and Mancini half. When we had the chance, one threw on last season’s top scorer, touch more,” he said. Carlos Tevez, in a bid for all three “Apart from that I enjoyed the points, but in vain. game. First half we played very well, but second half maybe we were too long, because every player wants to GROUP A score a goal and we left a lot of space.” TEAM PLD W D L F A PTS Kolarov’s strike Mancini’s men came into their first Bayern 1 1 0 0 2 0 3 meant City were game in a hugely competitive Group A Napoli 1 0 1 0 1 1 1 behind for just in free-scoring, all-conquering form six minutes after a blistering start to the season. Man City 1 0 1 0 1 1 1 And they looked set to continue in Villarreal 1 0 0 1 0 2 0 Picture: PA Exiles star Corbisiero ready Emotional Williams still to apologise for US Open rant

to replace stricken Sheridan ▲ TENNIS agreed with the umpire,” Williams tweeted yesterday. “It has been a long

▲ impact in New Zealand. going to be a big job for all of us. FORMER world No1 Serena Williams road to get back to the US Open this RUGBY UNION The American-born 23-year-old, “Losing someone with the experi- has again passed up the opportunity year, and I am thankful to have had BY JAMES GOLDMAN who was one of the finds of ence of Sheridan is tough, but it will to apologise for her astonishing rant such a great two weeks in New York.” England’s Six Nations campaign make us stronger and pull together. at the umpire during her US Open The incident came just two years ENGLAND prop Alex Corbisiero earlier this year, was disappointed to We have four good players there. final defeat and claimed her outburst after the American was fined a grand insists he’s ready to make the most see Sheridan suffer such a painful “I was aware Sheri had a niggle was prompted by the stresses of an slam record £53,000 and handed a of a World Cup opportunity present- fate but is confident he can bring form the weekend but I didn’t emotional week. suspended ban from the US Open for ed to him by Andrew Sheridan’s the necessary bite to England’s front realise the severity of it until I heard Williams collapsed to a surprise launching a foul-mouthed diatribe at untimely injury. row. a couple of the boys talking about it. straight sets reversal against a line judge. Sheridan damaged his shoulder in “When my opportunity comes I’ll “I just wish him all the best. He’s a Australia’s Samantha Stosur and in She was warned another “major last weekend’s bruising encounter be ready to take it and make the world-class player. He’s a big hero of the closing stages accused Eva offence” before the end of 2011 against Argentina and will play no most of it,” Corbisiero said. mine. I think the squad will miss Asderaki of, amongst other things, would trigger the ban and another further part in the tournament, “Responsibility will fall on all of him tremendously, but we’ve just being “unattractive inside”. fine, but on this occasion the USTA opening the door for London Irish’s us, as a front row, as a pack. There’s got to get on with it now and go for- “My emotions did get the best of deemed her crime worthy of a mea- Corbisiero to make a significant four of us (props) left here and it’s ward together as a team.” me this past weekend when I dis- gre $2,000 fine.