BUSINESS WITH PERSONALITY FIND YOUR LEGACY VAN PERSIE IN CHOOSING THE OLYMPIC SPORT THAT INSPIRES YOU DEBUT DEFEAT See Page 18 See Sport Page 19 ISSUE 1,700 TUESDAY 21 AUGUST 2012 www.cityam.com FREE Soros reveals new stake in POLLY PECK THIEF Man United

BY JULIAN HARRIS

BILLIONAIRE investor George Soros has splashed out on a 7.85 per cent passive stake in Manchester United, NADIR FACES JAIL a filing with the US Securities and Exchange Commission revealed late last night. BY MICHAEL BOW Soros Fund Management bought over three million of the new class POLLY Peck International founder A shares, which were created for Asil Nadir, one of the London stock the club’s initial public offering market stars of the 1980s, was yester- (IPO) in New York on 9 August. day found guilty of three counts of The shares hold only one tenth of theft totaling £5.5m from the for- the voting power of the majority mer FTSE 100-listed global conglom- class B shares, which are held by erate. United’s Florida-based Glazer Turkish-Cypriot born Nadir, who family owners. left the UK for northern Cyprus in Last week it emerged that Soros 1993 and returned in August 2010 to acquired 341,000 shares in face the charges, was found guilty Facebook over the previous quarter, on the three counts of theft by a building his stake at a time when jury at the Old Bailey yesterday. the social network’s stock was He was cleared of one count of battered by valuation concerns. theft totaling £2.5m. The jury has Soros is famed for betting yet to reach a verdict over nine fur- against sterling on Black ther allegations of theft. Wednesday in 1992, a move that It was sent home last night and earned him in excess of $1bn. will resume deliberations this morn- The news that he has piled into ing. Manchester United’s stock came Nadir, 71, had been charged with after the share price closed at 13 specimen counts of theft of £34m $13.06 last night. from PPI between 1987 and 1990. The price of the stock has fallen The three counts for which Nadir considerably since the launch of has been found guilty are for steal- the club’s IPO, dropping from an ing £1.3m from PPI to pay for compa- Former tycoon Asil Nadir was a business star of the 1980s after leading his Polly Peck International conglomerate to a stellar FTSE performance initial $14 per share. ny shares on 15 June 1989, stealing And the expected range for the £1m from the firm to pay for maker Sansui. This year’s trial, which has been to bring the case given the length of float had been even higher, at antiques on 19 December 1989, and In the UK it controlled Joseph Le running since January, has seen time that has elapsed. between $16 and $20 per share. stealing £3.25m from the firm on 19 Shark and Russell Hobbs. prosecutors for the Serious Fraud “This is a flagship case for the SFO Manchester United supporter March 1990 and placing it in 19 dif- However, on 19 September 1990 its Office, led by Philip Shears QC, and the reputation of the Office groups have complained that the ferent end destinations. shares plummeted from an opening argue the case against Nadir. depends upon its flagship cases. IPO was over-priced and prevents Born in Cyprus in 1941, Nadir sold price of 243p to 108p in a matter or Nadir has been represented by “The SFO has done particularly investors from having a say in the newspapers at the age of six before hours, and its shares were suspend- Philip Hackett QC. well given the circumstances such as running of the club, as t he Glazers moving with his family to London in ed. The firm collapsed the following Kingsley Napley criminal depart- the age of this case.” hold onto the levers of power. the 1950s. year amid an investigation by the ment head Stephen Parkinson said Nadir has argued he had been Groups such as the Manchester The tycoon, once dubbed the Serious Fraud Office. the SFO has done “particularly well” unjustly treated by the SFO. United Supporters Trust also Sultan of Berkeley Square by a biog- complained that the Glazers rapher, bought the Polly Peck tex- pocketed a substantial amount of tiles company in the late 1970s and the revenue raised from the IPO, set about turning it into one of the rather than using it all to help biggest public companies in the UK. The UK that Nadir left in 1993 reduce the club’s large debts. Polly Peck duly became the darling of the London markets during the The land Asil Nadir found when he entertainment, a pint of lager would set Manchester United PLC boom years of Margaret Thatcher’s returned to the UK in 2010 was distinctly them back just £1.44. A first class stamp 14.50 $ Conservative government. It enjoyed altered from the one he left in 1993. class was 25p, a pint of milk cost 34p, 13.06 a stellar rise during the 1980s and Music and film had reached something and bread was just 48p a loaf. 20 Aug became the best performer on the 14.00 of a high water mark in 1993, with Meat But some things have stayed the same London Stock Exchange. Loaf’s seminal I’d Do Anything for Love since those halcyon days – the Prime The firm, based out of a small 13.50 office in Mayfair, had interests span- (But I Won’t Do That) dominating the Minister was Conservative and Kenneth ning the globe. It owned Santana in airwaves and blockbusters such as Clarke was in the Cabinet. America, Del Monte in South Jurassic Park and Mrs Doubtfire filling 13.00 America, Vestel and Pizza Hut in cinemas. Meat Loaf’s single held the top Turkey, Sunzest and Unipac in For those thirsty after all this spot for seven weeks in 1993 Cyprus and Japanese electronics 14Au g 15 Aug 16 Aug 17 Aug 20Au g

Certified Distribution FTSE 100 M5,824.37 -28.05 DOW M13.271.64 -3.56 NASDAQ M3,076.21 -0.38 £/$ 1.57 unc £/€ 1.27 unc €/$ ▲ 1.24 +0.01 02/07/12 til 29/07/12 is 131,194 TUESDAY 21 AUGUST 2012 2 NEWS To contact the newsdesk email [email protected] Stansted considered a prize asset now it is finally being sold

HERE are more than a handful of of airlines, including major long-haul is seen as a very saleable asset, with less than busy investment carriers. analysts estimating it could fetch SFO GETS A MUCH NEEDED BOOST T bankers celebrating the decision EDITOR’S It seems unlikely that Stansted around £1bn or so. THE SERIOUS Fraud Office (SFO) will yesterday by Spanish group could ever become a major hub A number of groups are believed to be especially relieved at getting a Ferrovial that it will sell Stansted LETTER because long-haul operators prefer to be interested, including the council- result in the long-delayed trial of Asil Airport. The group is finally doing so be where the most passengers are. controlled Manchester Airports Nadir, the tycoon who fled the coun- after three years of wrangling with But new ownership has arguably Group, which is in discussions with a try to go to northern Cyprus in May the competition authorities. DAVID HELLIER given Gatwick the freedom to market financial buyer over selling a stake. 1993. Nadir’s 17-year exile was a major The Spaniards have been trying long itself for services in all sectors, includ- Also said to be monitoring the situa- embarrassment for the SFO, which and hard to avoid a sale, even threat- ing long-haul. tion are South Korea’s Incheon and was powerless to seek his return. ening last month to appeal against a airport industry would benefit from For example it has attracted the new Ryanair, which has said it might take There were then fears the jury might Court of Appeal ruling. But yesterday more varied ownership. Asian-based airlines such as Air a stake but in reality might support a not understand fully some of the the owners of BAA snapped and gave BAA has long argued that Stansted China, Korean Air and Vietnam new owner with some guaranteed complex accounting issues presented up the fight. serves a distinct market from Airlines to give passengers flying contracts for a couple of years or so in to them by the prosecution. It is an unwilling seller, having Heathrow and therefore that its own- from Gatwick more destinations to return for some favours on landing Success may not be enough to fully already been forced to sell both ership of both airports could hardly choose from. charges. revive the body, though, says Stephen Gatwick and Edinburgh airports in be deemed anti-competitive. BAA sources say there are countless Manchester Airports Group is proba- Parkinson of Kinglsey Napley. Fears response to a Competition Essentially Stansted, which has been slots up for grabs at under-utilised bly the early favourite given that it is the SFO might be folded into the Commission (CC) report in 2009 into losing passengers from a peak of Stansted – for free – but airlines are pursuing two key recommendations: National Crime Agency and budget its ownership of seven airports in total around 24m a year to under 18m, is reluctant to give their slots up at one to explore the opportunity to add cuts have badly affected morale. in the UK. served mainly by two low-cost air- Heathrow under any circumstances. a quality airport to the group and the The CC felt this was an uncompeti- lines, easyJet and Ryanair, whereas Whatever the rights and wrongs of other, to bring in new equity invest- [email protected] tive arrangement and that the UK’s Heathrow is a hub served by a variety the competition argument, Stansted ment as part of the deal. Allister Heath is away

Analysts predict IN BRIEF Apple now most valuable firm upward shift in BAA’s airport sale lures  Apple became the most valuable public company of all time yesterday, breaking a 13-year record as GDP revisions speculation mounted about new versions of its iPhone and iPad as well as a set-top box to deliver live TV. BY BEN SOUTHWOOD Ryanair and Manchester The Californian firm reached a market capitalisation of $623.5bn in trading REVISIONS to GDP due on Friday BY CATHY ADAMS yesterday, overtaking the $618bn will show that output shrank more Microsoft hit in 1999. Apple’s share slowly than previously thought, and MANCHESTER Airport Group (MAG), price has risen steadily since it perhaps even grew slightly over the which owns Manchester, became the world’s most valuable second quarter, economic analysts Bournemouth and East Midlands air- company last year. have predicted. ports, is understood to be the front- Friday’s revision will reveal a fall runner to make a £1bn bid for of 0.5 per cent in the UK’s GDP over Stansted Airport. Parties find it tough to get funds the second quarter, predicted Aviation firm BAA revealed yester- Goldman Sachs’ economics team, day that it is to sell Stansted Airport  Donations to political parties fell below the original 0.7 per cent dip. after it gave up on a long legal battle. almost £1m in the second quarter, Three datasets published since BAA had been fighting a 2009 Electoral Commission figures showed the original figures feed into this Competition Commission ruling yesterday. Parties reported receiving more positive expectation. that forced it to sell Stansted, which just under £7.9m, with almost £3.8m Industrial production fell by 0.9 per handles 17.5m passengers and going to the Conservatives, cent over the quarter, rather than 133,500 flights each year, because of approximately £3m to Labour and just 1.3 per cent as originally believed, a lack of competition between over £700,000 to the Liberal while construction output and London airports. Democrats. The biggest donor was the retail sales were also revised up. The firm, which is owned by a con- Unite union, which gave Labour Vicky Redwood at Capital sortium led by Spain’s Ferrovial, has £840,275, and together the unions Economics went further, proposing asked banks including Bank of BAA boss Colin Matthews has finally agreed to sell off Stansted Airport donated close to £1.6m to Ed that the underlying picture might America Merrill Lynch, Deutsche Miliband’s party. even be positive when taking into Bank and Morgan Stanley to pitch the Essex-based airport, as it bought up 2007,” said Ryanair spokesman account the extra bank holiday. ideas for the sale process. 20 per cent of BAA last week, underlin- Stephen McNamara. He argued that MAG previously said in a statement ing its interest in UK airport assets. BAA kept aviation fees “artificially Health firm Aetna in $5.6bn bid Revisions to GDP have been frequent and significant that it was exploring the opportuni- Budget airline Ryanair, which high” to make the airport more attrac-  American health insurer Aetna said 1.5 %pts ty “to add a quality airport to the accounts for three out of four flights tive to a future buyer. yesterday it plans to buy rival group”. It is thought to have enough from Stansted, has also been Gatwick Airport yesterday welcomed Coventry Health Care for $5.6bn 1.0 cash on its balance sheet to buy approached by several potential buyers the sale. Stewart Wingate, chief execu- (£3.5bn) to increase its share of the 0.5 Stansted Airport. wanting to join a consortium bid. It is tive of the Sussex airport, said: “The fast-growing, US government-backed Meanwhile, it is thought that understood that the airline is after a Civil Aviation Authority now needs to Medicare and Medicaid programmes. 0.0 Global Infrastructure Partners, 25 per cent stake. remove the unnecessary burden of eco- The deal comes amid consolidation -0.5 which previously bought Gatwick Ryanair has long been critical of BAA nomic regulation imposed when BAA across the sector as firms try to and Edinburgh airports from BAA, and its stranglehold over Stansted, par- was a monopoly, and which threatens -1.0 position themselves to benefit from has ruled itself out of the bid. ticularly with the fees that it charges to restrict full competition and invest- President Barack Obama’s healthcare -1.5 Qatar’s sovereign wealth fund airlines to use the airport. ment, which will benefit passengers reforms. ‘98 ‘00 ‘02 ‘04 ‘06 ‘08 ‘10 ‘12 could also be a potential bidder for “The charges have doubled since and airlines.” WHAT THE OTHER PAPERS SAY THIS MORNING Handling of Jackson changes hands Michael Jackson hits from Beat It to Billie Citi chief rejects calls for bank splits Jean will for the first time be represented Hunt sets broadband deadline Orange/T-Mobile in spectrum sale China’s Gu may serve only 9 years Citigroup’s chief executive has knocked by the late singer’s publishing joint Jeremy Hunt has given telecoms Britain’s biggest mobile operator, Gu Kailai, the wife of deposed party back the idea of big banks being split up venture with Sony. companies three years to speed up the Everything Everywhere, formed from the official Bo Xilai, could be released from after calls from people such as his broadband network after pledging that merger of Orange and T-Mobile, is in prison within nine years on medical predecessor Sandy Weill. Vikram Pandit Footballers’ pay rises 1,500 per cent Britain will have the fastest internet of advanced talks to sell a chunk of airwaves parole, legal experts say, despite being said Citi, formed in Mr Weill’s time with any leading European country by the end Top footballers’ salaries increased 1,500 to the country’s smallest operator, Three. given a suspended death sentence for the mergers such as the acquisition of of this parliament. murder of a British businessman. per cent from the creation of the Premier Travelers in 1998, had already gone back League in 1992 to 2010, according to a Murcia could request €700m to the basics of banking, and aside from High Pay Centre report. Over the same Drugs patent bonanza challenged Syria’s leader broke, says France some global markets businesses had sold Spain’s Murcia region could request up to period, average UK wages rose 186 per Novartis is taking the Indian government most of the units from that deal. The €700m (£550m) from the central France plans to discuss with Russia ways to cent. The report says salaries now account to the nation’s Supreme Court tomorrow in transformative Citi purchases helped end government to keep it afloat, amid reduce funding to Bashar al-Assad's for up to 70 per cent of a club’s turnover, a landmark case that could affect the price the Glass-Steagall separation of retail and growing concern over the state of the regime, which is running out of cash, the compared with 48 per cent in 1997. of medicines for hundreds of millions. investment banks in the US. region’s finances. French foreign minister said yesterday. CITYAMCAREERS.com The new jobs website for London professionals TUESDAY 21 AUGUST 2012 cityam.com NEWS 3 Early investor Thiel Raymond will lead JPM probe sells Facebook stock BY TIM WALLACE FORMER Exxon Mobil boss Lee BY BEN SOUTHWOOD which he has held for eight years, Raymond is investigating the so- until last Thursday, along with other called London Whale derivatives EARLY Facebook investor, current early investors, meaning he was losses that hit JP Morgan earlier board member and billionaire unable to take advantage of the this year, the bank said yesterday. PayPal co-founder Peter Thiel last opening price of $38 – which had The institution hopes a week unloaded most of his shares in made Facebook the first firm to thorough investigation headed by the social networking giant, debut at a market capitalisation of the well respected business leader according to a filing to the US above $100bn. will at last draw a line under the regulator released yesterday. Facebook’s share price fell six per episode which saw the bank take The venture capitalist and hedge cent on Thursday as investors were huge losses on the derivatives. fund manager sold around 20m released from their post-IPO lock-up. Last month JP Morgan posted shares in the tech firm, at an Thiel had planned to sell the losses of $5.8bn (£3.7bn) on the average price of $19.73, netting him shares as part of a trading strategy position built up by the Chief $400m – compared to an initial set out in May, according to Investment Office (CIO) in London, investment of $500,000. yesterday’s filing. He still owns and warned that it could generate PayPal founder Peter Thiel has sold most of his Facebook shares Thiel was locked into his stake, around 5.6m shares. another $1.2bn or more of losses. Virgin launches flights on West Coast rail route

BY JAMES WATERSON First has promised the government substantially higher payments but VIRGIN Atlantic will today announce Virgin claims its rival’s sums do not plans to operate flights between add up and necessary cutbacks will London and Manchester, just days result in a lower standard of service. after its sister firm Virgin Trains lost Last night a spokesman for Virgin the right to run rail services between Trains told City A.M. that the firm was the two cities. not giving up the fight to hold onto Richard Branson’s airline will start the rail franchise: “We are keeping flying between Heathrow and our options open, including judicial Manchester airport in March 2013 review.” The company has until 28 and says this is the first step in build- August to launch a legal challenge. ing a domestic network. Both compa- The rail operator has also been pub- nies said the timing of the licising an independent online peti- announcement was entire- tion that urges the government to ly coincidental. reconsider the decision to hand the “Operating a London to franchise to First. It has Manchester route will pro- already attracted more than vide an invaluable feed to 14,000 signatures. our existing long haul net- The House of Commons’ work for both business and public accounts com- leisure passengers,” said mittee and transport Virgin Atlantic’s chief select committee are executive Steve expected to examine Ridgway. the rail deal when Last week Virgin parliament returns in Trains controversial- September. ly lost out to First Group in the bid- ding for a new West Richard Branson’s Virgin Coast rail franchise. will retain a link from London to Manchester Just a third of workers return to Lonmin’s Marikana mine BY CATHY ADAMS dismissals are decided upon. The ultimatum was issued after OPERATIONS resumed in a muted a 10-day long strike that left 44 fashion at the Marikana mine people dead, but it only applied yesterday, as less than a third of to the 3,000 illegally-striking Lonmin workers returned to rock drill operators. work. Lonmin was unable to give a Across the 12 shafts at breakdown of how many Marikana, 27 per cent of workers strikers and non-strikers – out of a 28,000-strong workforce reported to work. – turned up for the morning Deutsche Bank now forecasts shift. Lonmin to make a loss in 2012, It comes despite an earlier expecting at least three weeks’ ultimatum issued by Lonmin, worth of production to be lost which ruled that those illegally due to the strikes. striking who did not return to Lonmin shares fell for the work yesterday would face sixth straight day yesterday, dismissal. The platinum firm has closing 4.61 per cent down at given those who did not turn up 610p. The stock has fallen from for work until today before a high of 774p on 7 August. TUESDAY 21 AUGUST 2012 4 NEWS cityam.com Construction in Bundesbank Eurozone deep in depression sinks hope of BY BEN SOUTHWOOD ACTIVITY in the Eurozone construction industry sank further in June, Eurostat said yesterday. Seasonally adjusted production ECB bond buy in the bloc’s construction industry edged down 0.5 per cent compared quickly have to back up its pledge to May, putting it 2.8 per cent down BY TIM WALLACE with hard cash, and any commitment on the year, and almost a quarter to potentially unlimited purchases lower than its pre-crisis peak. SPANISH government borrowing costs would probably require the central Greek Prime Minister Antonis Samaras must reassure the country’s bailout providers Economic powerhouse Germany dropped yesterday on hopes that the bank to undertake full-blown quanti- registered a surprise two per cent European Central Bank (ECB) could tative easing too. Throw in the issues monthly dip, while besieged Spain announce further bond buying to cap of monetisation of debt, and this idea saw a 1.3 per cent increase in yields at safe levels, even though the appears to be a non-starter,” he added. Greece pledges fresh austerity construction output. ECB denied the claims. And an ECB spokesperson hit out at Construction looks unlikely to Germany’s Bundesbank made clear the rumours: “It is absolutely mislead- recover much over the next two its opposition to any such scheme, ing to report on decisions which have years, said industry experts in their arguing that bond-buying amounts to not yet been taken and also on indi- as Germany toughens stance summer conference, selected the central bank financing govern- vidual views which have not yet been results of which were released by ment spending – something the ECB discussed by the governing council.” BY CITY A.M. REPORTER after meeting his Greek German think-tank Ifo yesterday. is not allowed to do. The Bundesbank added that it ministerial counterpart Dimitris Growth would be just one per cent Yet yields on Spanish 10-year bonds “remains critical of the purchase of GREECE hopes to obtain its Avramopoulos. in 2013, they predicted, following a dropped, ending 16 basis points down euro system sovereign bonds”. lenders’ approval for a new wave Fresh austerity moves worth completely flat 2012. at 6.28 per cent. ▲▲FORUM: Page 12 of austerity measures by the around €11.5bn (£9bn) are in the However, manufacturers in Some economists had hailed middle of next month, a Greek pipeline, according to the Greek western German regions are rumours that the ECB was set to help Spanish bond yields remain high finance official said yesterday. finance ministry. planning to increase their 2012 troubled governments, arguing it rep- % The news coincided with a A senior official said: “Our aim investment some seven per cent resented the most effective way of 6.28 separate statement from German is to have agreed with our over the €44bn (£34.6bn) spent in 8 20 Aug reducing pressure on states’ finances. foreign minister Guido partners by 14 September.” 2011, a separate survey, also “The hope would be that, simply by 7 Westerwelle, who warned that his Winning approval for the released by the Ifo institute, making an explicit pledge to keep government would not soften its savings due in 2013-14 is key to showed. yields below particular levels, the ECB 6 demands for Greece to appeasing the troika – the EU, Respondents plan to invest not might reduce the chances that it will consolidate its public finances. European Central Bank and only in expanded production, but actually have to wade into the bond 5 Any substantial watering-down International Monetary Fund – also in adapting their “product market,” said Capital Economics’ of the conditions for Greece’s who are expected back in Athens palette” to changing demand. After Jonathan Loynes. rescue package would be next month to decide whether to adaptation, the next most common “To be credible, the ECB would Mar Apr May Jun Jul Aug unacceptable, Westerwelle said continue with the bailout. plan was replacement of capital. TUESDAY 21 AUGUST 2012 cityam.com NEWS 5 BARNES & NOBLE NOOK COMES ACROSS THE POND Legal firm Irwin Mitchell given regulatory go-ahead to expand

BY ELIZABETH FOURNIER The decision means it can press £50m of outside investment. ahead with ambitious expansion “We can now push on with our LAW firm Irwin Mitchell said plans, with group chief executive plans for growing the business. yesterday it had been given the John Pickering saying the licences Conversion to ABS status sends a regulatory nod to go ahead with its “position us well to take advantage clear signal that we intend to move conversion to an Alternative of the opportunities which we think forward with our strategy,” said Business Structure (ABS), paving the will arise from the changing legal Pickering yesterday. way for ambitious growth plans. landscape”. “Irwin Mitchell is one of the The mid-tier firm was among the Irwin Mitchell stuck its head way largest organisations we have first batch of companies to apply for above the parapet in early 2011 authorised so far, and the first approval from the Solicitors’ when it announced its intention to multi-licence to be granted. It just Regulation Authority (SRA) in seek ABS approval, challenging the shows that the new legislation gives January, and yesterday received five traditional law firm structure by plenty of scope for all types of licences covering its various group targeting potential mergers and applications,” said the SRA’s chief businesses. acquisitions and looking for up to executive Antony Townsend.

AMERICAN bookstore Barnes & Noble is set to take on Amazon by launching its Nook ebook reader in the UK, the company announced yesterday. Two ereaders will be released in mid-October, Barnes & Noble said, although pricing was not revealed. A number of partnerships with high street retailers are due to be announced soon. Schulze fails in Best Buy bid as talks collapse BY JAMES TITCOMB Schulze, who founded Best Buy in 1966 and stepped down as chairman BEST Buy founder Richard Schulze’s in May after a misconduct scandal plans to take over the retailer have col- involving then-chief executive Brian lapsed after negotiations between the Dunn, recently made public his plans two parties broke down, the to buy the company. Best Buy said yes- American firm said yesterday. terday that Schulze had provided The electronics megastore owner, insufficient information for it to con- which shut its UK shops last year hav- sider the deal as it stood. ing launched a joint venture with Best Buy also announced that Carphone Warehouse, said Schulze Hubert Joly is set become its new chief rejected proposals to work with Best exec, ending a four-month search after Buy on a deal that would have led to Dunn’s departure in April. Joly, who is an offer in the next two months. currently CEO of hospitality firm Best Buy said it was willing to waive Carlson, will arrive in September. Minnesota law and provide Schulze’s Despite Schulze repeatedly declaring team with non-public information his plans to purchase Best Buy at about the company, but that Schulze between $24 and $26 a share, the “declined to participate” with meas- share price has remained stubbornly ures to provide “certain protections below that level, with traders sceptical for Best Buy and its shareholders”. that the deal will go through. Schulze is said to have been unhap- py with the timing of the deal pro- Best Buy Co Inc posed by Best Buy, which would not 18.16 20.50 $ have seen an offer to shareholders 20 Aug until next year. 20.00 He said: “I am disappointed and sur- prised by the Best Buy board’s abrupt 19.50 termination of our discussions,” adding that the proposals were “com- 19.00 pletely unacceptable in light of the fact that urgent change is needed at 18.50 Best Buy and value is eroding further every day”. 14Au g 15 Aug 16 Aug 17 Aug 20Au g Rank’s odds get longer as Gala deal faces competition inquiry

BY JAMES TITCOMB local areas” and referred it to the competition commission, which CASINO giant Rank Group’s will report in February. £205m purchase of Gala took a A takeover will make Rank the major setback yesterday as the biggest casino company in the UK, Office of Fair Trading (OFT) with 44 per cent of the country’s announced that the deal will face casinos. Shares dipped yesterday a competition inquiry. and analysts warned the probe will The OFT raised fears that the possibly cancel the deal. deal “would reduce competition Rank said it was “considering both at a national level and in nine the implications of the decision”. TUESDAY 21 AUGUST 2012 6 NEWS cityam.com CME plans to grab market share Insider trading couple ordered with currency futures exchange

to hand £1.5m proceeds to FSA BY TIM WALLACE Steve Grob from Fidessa believes the firm could well establish a A NEW derivatives exchange is set strong position in the market. BY JAMES WATERSON But yesterday’s confiscation order was to insider trading, prosecuting it as a to break open the dominance of “This is a significant move as substantially higher as the court criminal offence rather than using the NYSE Euronext’s Liffe and CME tries to enter a sector A HUSBAND and wife insider assumed that all other trading that the civil process of market abuse.” Deutsche Bourse’s Eurex, industry historically dominated by Eurex dealing team were yesterday they undertook within the same peri- A previous confiscation order for experts forecast yesterday. and Liffe,” he told City A.M. ordered to pay more than £1.5m to od represented the proceeds of crime. £640,000 from Sa’aid brings the total CME announced its plans to “By starting with currency the Financial Services Authority Tony Woodcock, a partner at law seized to £2.17m, the FSA’s biggest establish the new exchange by the futures, they are extending their (FSA) in one of the biggest cases of firm Stephenson Harwood, told City haul for an insider dealing case middle of next year, beginning in successful US franchise. CME can its kind. A.M.that the hefty punishment was Christian Littlewood had been foreign exchange futures and build that up, and later try to go Former Dresdner Kleinwort part of the FSA’s tough approach to earning around £1.5m a year from his potentially expanding into areas into the interest rate business, and banker Christian Littlewood and his insider trading. day job and the couple had bought a including interest rates and metals. expand from there.” wife Angie Littlewood pleaded guilty “What they derived from the number of houses in Hampstead. It is applying for a Recognised Grob added that the competition to eight accounts of insider dealing illegal contact was a substantial But in February 2011 he was jailed Investment Exchange licence from could also push regulators to try to at a hearing in 2010. number of shares which the court is for 40 months after admitting the the FSA, to whom it will need to open up the market in derivatives, They admitted making a £590,000 entitled to confiscate, not just the offences. His wife received a suspend- prove it has the proper systems, for example by making one profit from offences committed profit. ed sentence for the sake of their chil- controls and personnel in place – a exchange’s contracts comply with between 2000 and 2008, assisted by “Over the last four years the FSA dren. Mr Littlewood was released in process that typically takes from another’s systems, allowing family friend Helmy Omar Sa’aid. has been more aggressive in relation May this year after serving 15 months. six months to a year. customers more choice.

IN BRIEF Quintain picks new top staff n Quintain said yesterday it has Amlin bounces appointed two new development directors at its two large scale London regeneration projects. The developer has poached Anthony Gill, a former property director at Grosvenor, to lead back thanks to its 14m square feet Greenwich Peninsula scheme. Ben Giddens has been promoted to development director of the Wembley City project.

Qantas chief exec to forgo bonus fewer disasters n The head of Australian airline Qantas will forgo his bonus and pay BY JAMES WATERSON ing income is paid out to cus- rise for this financial year, as the tomers – plummeted from 92 per carrier announced it has forecast a 90 INSURER Amlin yesterday reported cent to 53 per cent, while income per cent drop in profits for the year stronger than expected profits after from premiums increased by 20 per ending 30 June. It is understood that the firm enjoyed six months with- cent at £1.81bn. chief executive Alan Joyce’s pay will out any major catastrophes. Investment return on Amlin’s Amlin chief executive Charles Philipps praised his firm’s resilience fall to around A$2.5m from A$5m the The Lloyd’s of London firm report- £4.2bn assets was doubled to year before. Qantas has been ed first half pre-tax profits of £84.7m, while the firm’s effective HOW ARE AMLIN DOING IN struggling with increased fuel costs £184.5m against a loss of £192.3m rate of tax dropped to just eight per and a weak US and European market. for the same period last year. cent, largely thanks to the amount ANALYST VIEWS THE ABSENCE OF ANY “This is a welcome return to profit of business put through the insur- Interviews by James Waterson MAJOR CATASTROPHES? and the strength of our underwrit- er’s Bermudan unit. Barratt signs £250m Croydon deal ing result underlines the quality The FTSE 250 company also told JOY FERNEYHOUGH ESPÍRITO SANTO n Housebuilder Barratt Developments and diversity of our business,” said investors that it had agreed a new announced yesterday it has exchanged chief executive Charles Philipps. five-year, unsecured £300m debt “Amlin have delivered a good set of numbers following the peer group contracts with Greater London “The improving trading environ- facility with its lenders, replacing a Authority for a £250m redevelopment ment is creating many opportuni- £250m loan that was due to mature after a benign catastrophe half year. We think that the potential for Amlin to deliver attractive profitability in 2012 and 2013 is good. However the on Cane Hill in Croydon. Proposals for ties for profitable growth, for which in September 2013. the 83 hectare former hospital site – we have both the capital and the Amlin raised its half-year dividend shares have performed well and we see better upside elsewhere. ” the size of 100 football pitches – underwriting capability to take by 4.2 per cent to 7.5p and shares include 650 homes of which 163 will be advantage.” closed yesterday up 2.5 per cent at In common with most insurers, 389.1p. NICK JOHNSON NUMIS affordable, as well as 70,000 square feet of office, leisure and retail space. Amlin was hit hard by a series of “First half pre-tax profit of £185m is comfortably ahead of consensus, major catastrophes in 2011, includ- Amlin PLC mainly reflecting investment earnings outperformance. These results are a ing earthquakes in New Zealand, 389.10 Rab Capital’s hedge fund ups value 405 p welcome return to form for Amlin with the large reinsurance portfolio floods in Thailand, and the tsunami 20 Aug n Rab Special Situations fund, the 400 delivering strong profits. in Japan, resulting in hefty losses ” hedge fund backed by Rab Capital, yes- and forcing the firm to raise premi- 395 terday said it will continue to reduce its ums at the start of this year. MARCUS BARNARD ORIEL SECURITIES But so far in 2012 there have been 390 exposure to unlisted equities. However, few substantial disasters, enabling 385 it said the “success or failure” of “Gross written premiums have increased to £1,815m from £1,515m. The Falkland Oil and Gas, the fund’s biggest the firm to report a larger than 380 increase has largely been driven by a £116m uplift to reflect an improvement in position in its portfolio, would continue expected underwriting profit. 375 As a result Amlin’s claims ratio –a the process for recording premium income and strong growth in Amlin to determine the success of the fund. measure of how much underwrit- 14Au g 15 Aug 16 Aug 17 Aug 20Au g Re Europe, a start-up in its second year, where premiums have doubled. Tesco faces illegal worker fines Julius Baer lowers target for rights issue to fund purchase finds they did not carry out the describe as “visa abuse”. BY BEN SOUTHWOOD legally required checks. “In co-operation with Tesco, SUPERMARKET giant Tesco may The students are not illegal the UK Border Agency visited our BY CITY A.M. REPORTER extraordinary general meeting be hit with f ines after the UK immigrants, and did have the dotcom store in Croydon in July,” (EGM) to approve the issue of new Border Agency (UKBA) found it right to work, but their visas the statement read. SWISS private bank Julius Baer will equity capital set for 19 September.. was employing foreign stude nts limit term-time employment to “We take our responsibilities limit a rights issue to help fund its The bank reiterated its plans to for more hours than allowed by 20 hours a week. Investigators as an employer very seriously buy of Bank of America Merrill issue an additional SFr240m in new their visas. found they had been working and do not condone illegal Lynch’s overseas wealth- equity to Bank of America as part of Twenty students were arrested some 50 to 70 hours. working of any kind,” it went on. management business to SFr500m the acquisition funding. in a 3am raid on a Croydon In a statement, Tesco stressed Seven of the student workers (£393m) from SFr750m. Baer announced the acquisition a warehouse where employees that it was working with the have been deported, as part of a The bank said in a statement late week ago as it seeks to expand in work on fulfi lling internet authorities to tackle the issue, campaign by the UKBA, which yesterday that the board had decided emerging markets, but investors orders. Tesco faces fines of up to and that it did not sanction what has resulted in the deportation to limit the rights issue due to balked at the total cost of around £10,000 per worker if the UKBA the immigration authorities of around 2,000 illegal workers. shareholders’ feedback ahead of an SFr1.47bn, sending its shares down.

TUESDAY 21 AUGUST 2012 8 cityam.com Got A Story? Email [email protected] THECAPITALISTcityam.com/the-capitalist Mayor’s auction passes £200,000

JUST four days into the bidding for statue, but with a good 10 days to London Presents... page of the City Wenlock, the huge sums go we’re confident our favourite auction are being sold to raise offered for the gentlemanly mascot pinstriped character can beat that money for the Mayor’s Fund, a have helped pushed the total total – especially as last night his charity that aims to give life amount raised for the Mayor’s current bid was nearing £17,000. chances and aspirations to Fund for London in the Olympics For those who want a slice of the disadvantaged children, young auction to £201,000 – with plenty London 2012-themed memorabilia people and their families in more to come in the next few but are less inclined to give a home London. weeks. to a two-metre tall cyclops, there To check out the latest prices and The highest price reached so far will be plenty more items appearing make a bid for your piece of Games has been a staggering £20,000 for online in the coming days. history, please pay a visit to the Union Jack-decorated Wenlock All the items on the Mayor of memorabilia.london2012.com

Legendary England all-rounder Andrew “Freddie” Flintoff is helping to raise funds 150-mile cycle ride to honour cricketer Tom IT might not sounds like much established a trust to provide given the recent exploits of cycling bursaries to aspiring cricketers and heroes Bradley Wiggins or Mark other sportspeople who need Cavendish, but the 30-strong team support to fund their training. arriving in London today at the end Cycling alongside players of a 150-mile bike ride across the including Andrew Flintoff and Steve country are far from professional James are Tom’s father, Matthew cyclists. Maynard, and two brave volunteers In fact the majority of the group from Brewin Dolphin, the completing the route from Cardiff investment management firm that to London are cricketers – joined by is sponsoring the gruelling ride, the odd investment manager – all with the team due to finish at The peddling furiously to raise money in Oval ground this afternoon. honour of cricketer Tom Maynard, a The total amount raised was former batsman for both nearing £19,000 last night, but Glamorgan and Surrey who died in there’s still a chance to boost the June. trust’s funds by donating at: In memory of Tom his family has justgiving.com/teams/TomMaynard IS THE UK HANDLING THE CITYVIEWS ASSANGE AFFAIR WELL? Interviews by Michael Bow and Annabel Palmer DAOUD AOUANE The UK may have been more aggressive than it AMLIN would have been due to pressure from the US, but as a member of the EU there are obligations to Sweden. Threatening to storm an embassy seems a tad extreme. SEAN MCGUINESS ”The sanctity of an embassy shouldn’t be DLA PIPER breached. We could have been more proactive in investigating the case against him and ensuring the trial is fair. JUSTIN KING ”The UK is potentially putting itself in a GUIDE PUBLIC AFFAIRS precarious position in its handing of the extradition affair. It sets a dangerous precedent and has international implications that the UK needs to consider.

These views are those of the ” individuals above and not necessarily those of their company TUESDAY 21 AUGUST 2012 cityam.com NEWS 9

RETAIL FAILURES IN 2011/ 2012 R3: Half of jobs Iglo’s Birds Eye survive after shops collapse

frozen range BY KASMIRA JEFFORD

MORE than half of all jobs at risk when high street retailers fall into STORES STAFF STORES STAFF STORES STAFF administration are saved, new beats gloom figures from the insolvency trade PRE INSOLVENCY PRE INSOLVENCY PRE INSOLVENCY PRE INSOLVENCY PRE INSOLVENCY PRE INSOLVENCY body R3 show. 784 8,000 614 7,500 610 6,000 Its analysis of major retail insolven- Chief executive Martin Glenn said: cies in the last financial year reveals BY MICHAEL BOW “We are now investing in the busi- POST INSOLVENCY POST INSOLVENCY POST INSOLVENCY POST INSOLVENCY POST INSOLVENCY POST INSOLVENCY that 53 per cent of jobs are saved dur- PRIVATE equity-owned Iglo Group, ness at record levels and up-scaling 400 4,500 388 4,320 333 3,896 ing the insolvency process while 48 the firm behind popular UK brands our core product production capa- per cent of stores survive. such as Birds Eye fish fingers, yes- bilities. Clinton Cards shed 49 per cent of terday posted half year core sales “While we expect markets in the its stores and cut 43 per cent of its growth of 3.7 per cent – led by a UK second half of the year to remain staff when it went into administra- boom in frozen food sales. challenging, we remain on track to tion, while Peacocks closed 37 per The company, which was put up deliver full year core category sales cent of stores and made 42 per cent of for sale by owners Permira this year growth.” staff redundant. but taken off the market after Iglo was the subject of a multi- “These figures show that the insol- failing to generate big enough bids, billion pound bid by BC Partners vency process, whilst never good said a 6.1 per cent increase in fish and Blackstone last month. news, can result in significant parts sales and 5.4 per cent in poultry led However, the offer didn’t match of the business surviving,” said Lee the growth. the price Permira wanted and the Manning, R3 president and a partner Figures from the firm also show company, which has owned Iglo for STORES STAFF STORES STAFF STORES STAFF at Deloitte. But he called for the retail total frozen food sales in the UK six years, has decided to stick with PRE INSOLVENCY PRE INSOLVENCY PRE INSOLVENCY PRE INSOLVENCY PRE INSOLVENCY PRE INSOLVENCY sector to change its methods, such as grew faster than total foods for the the firm for the next three years. maintaining unprofitable stores. first time ever. Iglo, which operates in 11 regions 3 250 146 2,600 313 3,885 “Portfolios are simply too large at Frozen food grew at 3.1 per cent across Europe, also said in its POST INSOLVENCY POST INSOLVENCY POST INSOLVENCY POST INSOLVENCY POST INSOLVENCY POST INSOLVENCY present...according to figures from over the half year, ahead of the 2.9 results that it has seen “strong 3 135 60 1,300 224 2,750 Deloitte, we could be seeing signifi- per cent growth of general food in performance” in Italy for its bake in cant downsizing of between 30 to 40 the UK. a bag fish products. per cent over the next 3-5 years.” Bovis leader calls for lenders to raise awareness of NewBuy

BY KASMIRA JEFFORD he said. £170.3m. The average sale price over Ritchie also said he was the period rose to £164,400 from THE CHIEF executive of Bovis unconvinced by government £163,400 and it expects its average Homes yesterday called for banks plans to remove social housing sale price for 2012 to be six per cent to take further action to promote requirements for property higher than 2011. the government’s NewBuy firms, arguing that the lack of scheme as first-time home buyers mortgage availability would Bovis Homes Group remain left in the dark. help undermine efforts to boost 515 p 491.60 David Ritchie praised the housebuilding. 20 Aug 510 scheme, which offers 95 per cent His comments came as the loan-to-value mortgages, but said group reported that profit 505 reservations were still trickling in before tax for the six months 500 at three or four per week. through June jumped to 495 “What would make it more £16.2m from £8.1m in the same 490 impactful is a bit more period in 2011 as it continued 485 awareness... It is a mortgage to shift its focus on more 480 product, not a housing product economically robust regions. but [banks] are not marketing it,” Revenue rose 27 per cent to 14 Aug 15 Aug 16 Aug 17 Aug 20 Aug Building your house on government support does not provide the firmest of foundations

ETWEEN a government watchword. By selectively selling practically falling over some plots of land from its itself to offer support and BOTTOM extensive stock and acquiring B the supply constraints others, it is shifting towards having that continue to dog the UK LINE two thirds of its business focused in property sector, there are worse the south, with the higher prices things to be, even in today’s that region can command. At the difficult marketplace, than a MARC SIDWELL start of the year, the builder had 59 housebuilder. As Bovis Homes per cent of its sites in the south. It proved yesterday, with a had grown that to 65 per cent by doubling of pre-tax profit in the problem, not a solution. The group the end of the half year. Moving to first half of the year compared is, however, already benefiting from a two-thirds southern focus should to the same period in 2011. the other schemes on offer. It help average sales price even Still, Bovis showed the limits “expects NewBuy to provide further without material improvements in of what government help can support to the new homes market”, the market. achieve, with chief executive and is already gaining three or four But the biggest challenge for David Ritchie blowing NewBuy reservations a week. It also Bovis may be staying ahead of the extremely cool on the idea that expects to use its FirstBuy allocation pack. When government reaches loosening the requirements for in the third quarter. out the taxpayer’s hand to help a affordable housing would Boosting the proportion of first whole sector, an individual firm provide much of a short-term time buyers risks skewing properties can’t rely on that aid to fix, given that in a depressed to the cheaper end of the market, differentiate itself to investors. The market finding extra private but Bovis seems to be overcoming real test for these results will be in buyers with the requisite that by proving location, location, how investors weigh Bovis’s mortgage approval remains the location remains the property performance against its rivals. 10 TUESDAY 21 AUGUST 2012 cityam.com Technology firms look to hire Mortgage lending jumps ahead more staff despite double dip

BY TIM WALLACE expand their businesses, with 43 of Funding for Lending Scheme per cent saying there are very BRITISH technology firms are likely to recruit new staff. BY TIM WALLACE per cent from £12.49bn in July 2011. coming weeks and these are already defying the recession according A total of 81 per cent of The real estate sector has filtering through – we’ve seen five- to an industry survey published business leaders back George MORTGAGE lending jumped struggled in part because buyers year fixed rates fall to historic lows yesterday, with businesses Osborne’s aim to make the UK sharply in July, according to require increasingly large deposits and expect more jostling for planning on expanding through “the technology centre of industry data published yesterday, to qualify for a mortgage, hitting position in this marketplace.” the economic downturn. Europe,” the study found, but 66 with the government’s new first-time buyers particularly hard. The sector has performed per cent said the government Funding for Lending Scheme But analysts also believe Mortgage lending bounced back in July strongly in recent months with does not understand the sector. expected to boost loans further uncertainty caused by the Eurozone £m 51 per cent of company bosses “There is clearly a divide through August. crisis and double-dip recession have 14,000 saying their business prospects between how confident business Gross lending rose eight per cent dampened the market. 13,500 improved over the past six leaders feel about the prospects 13,000 to £12.7bn in the month, reversing “It might be too early to call the months, and 34 per cent saying for their own business compared 12,500 the fall to £11.7bn in June, the end of the mortgage famine but prospects were unchanged. to the economy as a whole,” said 12,000 Council of Mortgage Lenders there are certainly encouraging That led to 60 per cent of firms Intellect UK’s deputy director 11,500 revealed. signs,” said SPF Private Clients’ 11,000 in the sector increasing their general Anthony Walker. However, analysts warn the Mark Harris. 10,500 level of investment, according to “However, if the storm clouds market overall remains relatively “The Funding for Lending 10,000 the study from industry body gather again across the wider flat, with large monthly variations. Scheme should deliver more 9,500 Intellect UK. economy these gains could be On the year, lending is only up 1.68 competitive mortgage rates in Jul‘11 Oct ‘11 Jan ‘12 Apr ‘12 Jul‘12 Similarly 67 per cent expect to quickly lost.”

YOUR ONE-STOP SHOP FOR JOB MOVES, CITYDASHBOARD BROKER VIEWS AND MARKET REPORTS

CITY MOVES WHO’S SWITCHING JOBS Edited by Tom Welsh NEW YORK Investor Relations Society metals trader at the financial products brokerage. He has Ashcourt Rowan over 30 years’ experience in the precious metals industry The professional body for the and joins from Societe Generale, where he set up and The wealth management firm has appointed Alan REPORT investor relations profession managed its precious metals sales desk. Allen has also Scrimger as head of its funds research division. He will has appointed John Gollifer as previously run the gold dealing books at Deutsche Bank, report to Ashcourt Rowan’s chief investment officer Toni its new general manager. He AIG and Natixis. Meadows. Scrimger joins from Standard Life succeeds Michael Mitchell, who Investments, where he was co-head of funds research. In Wall Street flat retires at the end of 2012. his new role, he will be responsible for enhancing the Gollifer is a former head of AG Barr firm’s research proposition. investor relations for the Singapore Exchange, and was involved in establishing The soft drinks group has appointed John Nicolson to its Savills after six week the Investor Relations Professionals Association in board as a non-executive director, effective January Singapore. He started his career at Barclays, and has also 2013. He is currently president of Heineken Americas, Charlie Walsh has been appointed head of exhibition and held senior roles at BNP Paribas and ABN Amro. and has also been deputy chairman of Compania overseas sales in the real estate advisory firm’s London rallying boom Cervecerias Unidas since 2009. Nicolson has a long residential development team. He originally started at career in consumer goods, and has previously held the firm in 2003, and he will continue to work with the Marex Spectron senior management positions at a variety of Russian existing London team in marketing UK developments Jack Allen has been appointed as a senior precious breweries. overseas. S stocks were flat yesterday, on signs of fatigue after a six-week +44 (0)20 7092 0053 Urun of gains, as the European Central Bank quelled SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT morganmckinley.com speculation about the form of market intervention that may be To appear in CITYMOVES please email your career updates and pictures to [email protected] taken to stem the region’s debt crisis. Despite the lethargic trading, Apple shares hit a new high, becoming the most valuable public company of all LONDON REPORT BESTof theBROKERS time, with the combined value of its shares exceeding a previous record set by Microsoftin 1999. Shares closed Invensys PLC 255.40 INVENSYS up 2.6 per cent at $665.15. FTSE slides lower as commodities 257.50 p 20 Aug UBS has maintained its “buy” The S&P 500 remains close to a four- year high, rising nearly five per cent 255.00 rating on the software group, but upped its target price to in the past six weeks. Investors had been waiting for the European 252.50 280p from 240p after re- and banks hit by economic worries Central Bank (ECB) to take steps to assessing the firm’s valuation. 250.00 The broker says a few months control the euro crisis in September. RITAIN’S top share index fell tions for further interest rate cuts by ago the company’s share price Last week, the index broke away from yesterday, easing further from China, the world’s largest consumer of 247.50 was over-discounting but now the 1,400 level where it had stalled for four-month highs hit last week, commodities. much of August. B appears fairly valued. weighed by a slide in banks and Among the miners, Xstrata shed 3.4 German magazine Der Spiegel said 14 Aug 15 Aug 16 Aug 17Au g 20 Aug commodity stocks as expectations for per cent, with investors cautious ahead over the weekend the ECB is consider- stimulus measures in China and Europe of results due today from the miner’s Compass Group PLC ing setting interest rate thresholds for took a slight knock. predator, commodities trader Glencore. 719.50 COMPASS GROUP any purchases of a struggling The European Central Bank sought to Xstrata also suffered from its exposure 722.50 p 20 Aug Panmure Gordon has a “buy” Eurozone country’s bonds. A bank quash speculation about the shape of its to Lonmin after a week of violence at the 720.00 recommendation on the food spokesman said it was misleading to new bond-buying plans and the mid-cap platinum miners Marikana 717.50 and support services group and report on decisions that still had not Bundesbank kept up its opposition to mine in which 44 people died. Xstrata 715.00 has raised its target price from been taken. the programme, even after German owns a 24.6 per cent stake in Lonmin Germany’s central bank, the 712.50 785p to 820p, after consensus leader Angela Merkel voiced support for after an aborted bid back in 2008. forecasts rose. The broker says Bundesbank, also reiterated its oppo- the ECB’s crisis-fighting strategy last Lonmin slid for a sixth day, losing 710.00 sition to bond purchases. A Compass is attractive due to its week. another 4.6 per cent. 707.50 spokesman for the German finance British bank shares had initially firmed defensive, predominantly non- ministry said it was not aware of any UK earnings. on reports but later fell, reflecting the FTSE 14Au g 15Au g 16Au g 17Au g 20Au g plans for the ECB to target bond sector’s heavy exposure to Eurozone 5,880 5,824.37 spreads. bonds. Global lender HSBC shed 1.2 per 20 Aug The slight losses on US exchanges 5,870 IG Group Holdings PLC IG GROUP cent. 465 p compared with much steeper declines At the close, the FTSE 100 index was 5,860 437.50 Numis has kept its “add” in Europe and a fall in the Shanghai down 28.05 points, or 0.5 per cent, at 5,850 460 20 Aug rating on the derivatives trader index to its lowest level since 2009. but cut its target price from 5,824.37, just holding above the 5,800 5,840 455 “Over there, the crisis is clearly level after having reached a session low 552p to 539p having updated much more real for them,” said Ken 450 of 5,802.91. 5,830 its forecasts to reflect the low Polcari, managing director at ICAP Commodity stocks were weak in 5,820 445 volatility in all of IG's key asset Equities in New York. London, tracking falls in Brent crude 5,810 440 classes. The broker expects Facebook shares briefly fell more and copper prices after a rise in Chinese first quarters revenue to be than 50 per cent from its issue price home prices dented investor expecta- 14Aug 15Aug 16Aug 17Aug 20Aug 14Au g 15A ug 16A ug 17A ug 20A ug down 20 per cent on last year. to hit a new low of $18.75. TUESDAY 21 AUGUST 2012 12

In association with THEFORUM cityam.com/forum The Eurozone’s new quick fix risks papering over much deeper cracks

ITH European politicians to defend the peg, causing it to accu- ute problems around the Eurozone – ground (thanks to its clearly defined still nursing their holiday mulate reserves equal to 65 per cent of since all Eurozone members stand statute, which stops it from financing sunburns, speculation has Swiss GDP. Clearly markets didn’t take behind the ECB. Such a huge decision, sovereign states). It also fails to offer a W already returned to the the bank at its word. It’s not clear that integral to the future of the Eurozone solution. This is why intervention has Eurozone crisis. the ECB would be any more successful, and Europe, should not be taken by an little support in Germany. Unsurprisingly, the focus is again on especially in the face of similar safe unelected apolitical institution. The spreads in borrowing costs are a European Central Bank (ECB) haven flows into northern Eurozone The fact that such a decision can’t be symptom of the crisis rather than a intervention, not least because its RAOUL RUPAREL countries, and investors’ desire to made at the intergovernmental level is cause, although they have admittedly president Mario Draghi’s offload risky assets at a decent price. a sign that the Eurozone is not ready made things more difficult. However, commitment to “do whatever it takes” Eurozone country. Any failure or Don’t forget that the ECB has also seen artificially forcing them together will to save the euro may now require him uncertainty in either area would see its own credibility dented over the past only paper over deeper problems. The to follow through. the level of ECB bond-buying directly two years. The ECB has already best such a move can do is to buy time. The main plan being mooted is for influenced by national governments’ It’s been contended that current bor- ‘ With the ECB already having bought the ECB to cap the difference in bor- decisions. This is even more concern- rowing costs are irrational and there- bought the Eurozone Eurozone leaders two years, which rowing costs between stronger and ing given that, if borrowing costs have fore warrant ECB intervention. While were promptly wasted, we must ask weaker Eurozone nations. The logic is an effective cap, the incentive for gov- yields may not accurately represent two years –which were whether this latest proposition is that growing yield spreads drive ernments to reform quickly and effec- the economic fundamentals of each worthwhile. investor fear, do not represent the true tively would be severely reduced. nation, they are a result of markets try- promptly wasted There is, as of yet, no definitive strength of these economies, and The oft-cited upside is that the ECB’s ing to price in the domestic and answer. But the first move must be at threaten a self-fulfilling bond run. unlimited commitment would be European political risk, as well as the the intergovernmental level. Until Germany is naturally wary. enough to deter investors from chal- structural flaws in the Eurozone. for such a move. Using the ECB to force progress is made there, any move by The plan would place the ECB direct- lenging the ceiling on borrowing Using the ECB to try to “correct” these the pace of integration may well back- the ECB would simply jeopardise its ly in the realm of fiscal policy and costs, meaning that the ECB may not issues would damage the price deter- fire. It seems many have forgotten the fundamental mandate, putting more political decision-making – a danger- be required to intervene much at all. mination mechanism in markets. problems caused by pushing ahead money at risk and dragging the crisis ous and almost untenable position for But this impact may be overstated. This leads us to another area of with an unfinished economic and on further, all without any clear end an unelected, independent central Take the peg between the Swiss franc potential political controversy. The monetary union, lacking clear politi- in sight. The ball is firmly in Eurozone bank. Bond spreads are ultimately the and the euro, equipped with its own ECB would be taking a huge step cal will, in the first place. leaders’ court and should stay there. market’s judgement of the fiscal policy “unlimited” backstop from the Swiss towards risk and debt pooling by On top of all of this, such a move Raoul Ruparel is head of economic research and domestic politics of each National Bank (SNB). The SNB has had allowing an EU institution to redistrib- stands on incredibly shaky legal at Open Europe.

Agree? Disagree? Got a sharp comment? The Forum wants you to join the debate. Twitter: @cityamforum on the web: cityam.com/forum or by email: [email protected] Top responses will be reprinted in The Forum. The cigarette display ban is a smoking gun in the war on free expression

HERE’S something odd about Many see them as crass, but they’re company to be able to express its decide that certain products cannot my local Tesco. Since April, art nevertheless. Indeed, some identity, and I see this law as a final be advertised – even to the point the kiosk at the entrance has FRONTLINE tobacco adverts are iconic. Marlboro nail in the coffin of a particular that the producer must give up T looked incredibly dull. As I man is a legend, and I still freedom of expression. control of their packaging, and was recently trying to work ECONOMICS remember the Hamlet cigar The big issue in this debate on the cannot even be seen publicly – we out why, I saw a sign saying that all television adverts from my cigarette display ban is how the have an attack on the science of cigarettes and tobacco-related childhood. They had little impact on policy has been received in business marketing. Even if marketing products must now be hidden ANTHONY J. EVANS me because I do not smoke and it schools. You might expect an professors are personally opposed to behind closed doors – to comply isn’t allowed in my house. But, economist to be against it – after all smoking, and don’t feel ashamed to with UK regulations. while I don’t tolerate smoking on we tend to take individual liberties inflict that opposition on others, at As an economist, I have little imposes on retailers. I note that my my property, I am happy to tolerate quite seriously, and we don’t like what point is enough enough? It expertise into whether such local newsagents have not fitted any it elsewhere. That’s called society. imposing regulatory costs on shouldn’t be left to free market measures prevent people from doors yet – they can wait until April I must confess that the smoking businesses. But it is doesn’t really economists to protect the freedom smoking. Given that one of tobacco’s 2015. But the owner laments this ban was in my personal interest, have much to do with economics. of expression upon which primary appeals to teenagers is barrier to honest commerce. since I enjoy not stinking of smoke What I find odd is that marketing marketing relies. cultivating rebellion, I suspect that My problem with the ban is the after a night in a pub. But it was professors do not seem as troubled Anthony J. Evans is associate professor more secrecy won’t help. But I could threat it poses to the liberty of concern for the liberty of others as I am, especially when this is a of economics at ESCP Europe Business be wrong. And I’m not aware of any marketers. that meant I opposed it. Now, direct suppression of their School. Website: www.anthonyjevans.com studies that have attempted to Like any art form, reactions to though, my liberties are being discipline. Email: [email protected] understand the costs that this policy advertisements are often subjective. directly impinged. I want any When governments arbitrarily Twitter: @anthonyjevans

FACT OF The last time the S+P 500 Index traded at 1415, THE DAY the Index fell 10% in the space of 1 month.

Trade today at www.cityindex.co.uk Spread betting, CFDs and TUESDAY 21 AUGUST 2012 13 The Forum is open for you to take part. Got a sharp comment on one of today’s columns? Do you have another subject you want to share your opinion on? We want to hear your views. Email [email protected] or comment at cityam.com/forum

RAPIDresponses Hollande’s raid on Universities work TOP TWEETS rich is the wrong Since BAA is selling Stansted, I hope this [Re: Release our business schools from the crucial that institutions offer a broad range means that Virgin will branch out into dead hand of state regulation , yesterday] of courses – not just those that will turn the airport management. Professor Len Shackleton’s proposed biggest profit. The UK has a thriving cultural @CarinaSecker “shake-up” of UK higher education is wrong economy that relies upon a steady supply of on a number of fronts. For a start, he fails to arts and humanities graduates. Thirdly, Three years after the maths told us euro kind of revolution recognise the success of our world class Shackelton is wrong to single out education exits were inevitable, is the EU finally universities which, despite years of under- companies like BPP as a model for future coming to the same conclusion? FTER little more than a investment, continue to deliver for this success. For-profit business schools and @DouglasCarswell hundred days in power, nation. UK universities generate £59bn a universities have been a disaster for French President François year for the UK economy and, with just 1 per students and taxpayers in the US. According I wonder if there is any evidence that playing Hollande’s popularity is cent of the global population, the UK to the US Education Trust, only one in five fields help sporting excellence more than the A dropping fast. Recent polls produces 7.9 per cent of the world’s students at for-profit colleges complete a new facilities their sale funds? show that 54 per cent of French research publications and 12 per cent of all four-year course and 20 per cent of those @ericjoyce citizens are dissatisfied with his citations. Secondly, it is far from a “national who finish will default on their loans within performance, compared with YANNICK NAUD scandal” that universities maintain their arts three years. That is not the kind of “shake- Alistair Darling says George Osborne has approximately 40 per cent in July. and humanities departments. It is essential. up” I want to see in Britain. “given up on growth.” He should know – the It’s little wonder –taxes on the rich, having failed to correct from 2007 At a time when students are being asked to Sally Hunt, general secretary of the University economy was growing when he handed over. which initially attracted voters, are highs. pay record sums to study at university, it is and CollegeUnio n (UCU) @D_Branchflower in danger of pushing business And 2013 will bring further chal- people out of France to countries, lenges. After three consecutive quar- like the UK, which are more open to ters of flat GDP data, the rewarding success. government’s growth forecast of 1.2 Pierre Moscovici, France’s prag- per cent in 2013 looks unrealistic. As David Cameron relaxes in Mallorca, is the matic finance minister, has commit- So far, the government has been ted to a budget deficit target of 3 per trying to increase domestic con- cent of GDP by 2013. So far, most of sumption through such measures the deficit reduction has been done as increasing the minimum wage, UK a better place to go on summer holiday? by raising taxes on wealthy house- and capping rent, petrol prices and holds and large corporations. utilities bills. But given the persist- Hollande will outline further meas- ent high unemployment and the ures next month, aimed at reducing continued depreciation of the euro, the deficit by another €33bn (£25bn) Hollande should instead be pushing in 2013, the savings calculated as policies that help boost exports to necessary in July by the cour des major trading partners, especially in YES NO comptes, France’s national auditor. Asia and the US. The most contentious of these is And this can only be achieved by the 75 per cent tax on top French making labour less costly, which earners. This would lure some of means reducing taxation on labour France’s most talented executives and making it more flexible to Patricia Yates Mark Hall and risk-takers to where there a international competition – espe- lighter tax burden. And Hollande’s cially vis-à-vis United Kingdom, What’s not to love! Consistently in the world’s top 10 most visited Having endured the rainiest summer on record, it’s no surprise that victory has given the Socialists con- which remains an important com- destinations, last year saw around 31m overseas visitors come here Brits want to go abroad for their holidays to enjoy some sunshine. trol of almost every political institu- petitor in both manufacturing and to enjoy what we have to offer. From West End theatre to cutting As a result, the decision to stay in Britain or go abroad is not made tion – the presidency, the upper and services. edge art, from castles to stately homes, Britain is renowned for its on price alone. However, foreign travellers have a fantastic choice of lower houses of parliament, all but So, at such a crucial time – when diverse culture and the depth of its heritage right across the country, holidays abroad, many of which are cheaper than holidaying at two of the regions and most of the Hollande needs the support of those including three of the top five most visited museums in the world. home when you compare like for like. With food and petrol prices country’s big cities, communes and contributing the most to the French Alongside that there is a fantastic range of shopping, a live music rising, and the high costs of attractions like theme parks and day departments. There is no reason to economy – taxes that alienate the scene second to none and a wonderful array of sport to savour – trips in the UK, a family holiday abroad can work out far cheaper – doubt that the government could affluent are unwise. David Cameron whether a Premier League match, the tennis at Wimbledon, a round particularly if you go to all-inclusive resorts where food, drinks, kids push through these budgetary and the UK might not need to roll of golf at St Andrews or coasteering in Wales. Our climate is also clubs, watersports and other sports activities are included in the measures, however unpopular. out the red carpet. Hollande is busy ideal for many people – not too hot in summer and perfectly mild price. All-inclusive holidays really do offer great value for money. Risks to the French economy are pulling the carpet from underneath for most of the winter. Whether it’s the natural beauty of the Case study research we conducted last year showed that a family of severe. The country’s banking sys- his own citizens. tem is one of the most exposed to Highlands, the miles of beaches along the Cornish coast or the four could save around £500 on a holiday by booking all-inclusive, Yannick Naud is a portfolio manager at peripheral Europe, while the French Glendevon King Asset Management and vibrancy of London, there’s something here for everyone. over a bed and breakfast alternative. has worked in convertible bond trading in Mark Hall is head of product for First Choice. property market, particularly in Patricia Yates is director of VisitBritain. Paris, looks worryingly overpriced, France, Japan and the UK.

4th Floor, 33 Queen Street, Editorial Editor Allister Heath | Deputy Editor David Hellier | Managing Editor Marc Sidwell Distribution helpline London, EC4R 1BR News Editor Elizabeth Fournier | Business Features Editor Philip Salter | Lifestyle Editor Zoe Strimpel | Sports Editor Frank Dalleres If you have any comments about the Tel: 020 3201 8900 distribution of City A.M. Fax: 020 7248 2711 Art Director Gavin Billenness please ring 0203 201 8955, or email Email: [email protected] Commercial Sales Director Jeremy Slattery | Commercial Director Harry Owen | Head of DistributionNick Owen [email protected]

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FX trading can result in losses greater than your initial deposit. TUESDAY 21 AUGUST 2012 14 cityam.com WEALTHMANAGEMENTTRADING Even dead cats can DAVID MORRISON SENIOR MARKET STRATEGIST, GFT bounce back to life CHINA AND US DATA FAIL TO The dead cat bounce can be a useful indicator of a declining CORRODE QE SPECULATION price, but traders still need to be cautious, writes Craig Drake HEN things go offering, prior to hitting the floor stock’s price. Much like an expired HE Dow and S&P 500 are both that the recent moderation in inflation data disastrously wrong, and bouncing in early June, before moggy, even a seemingly demised within spitting distance of the highs gives the government more room for W the market is always resuming its journey southward. Or, stock will see a small bounce when it achieved earlier this year. It will only monetary easing. Yet while the Chinese ready to obliterate a as Standard Chartered shows, a hits the floor. take a small push for both indices to consumer price index and producer price stock. It could be because of company can feel the wrath of Technical analysts describe a dead T index have slowed significantly over the past mistakes made in a market bears after regulators cat bounce as a continuation pattern surmount these heights. After that company’s operations, as in express concerns about the that appears to be a reversal pattern. hurdle, the bulls will have their sights on the 12 months, there should still be concerns the case of Carnival earlier company. It begins with a downward move and pre-financial crisis levels of 2007 – around about the outlook for inflation, as food and this year when one of its Whatever the reason for the is followed by a significant price 14,200 and 1,575 for the Dow and S&P 500 fuel prices push higher. While the soaring cost of oil, corn and soyabeans may, for liners ran aground off Italy’s decline, there is a certain macabre retracement. The price falls again, respectively. But there are question marks west coast. It could be like fun in watching a stock getting ham- exceeding the prior low. over this latest bull run, which has taken whatever reasons, fail to impact the official data, there is little doubt that it is already Facebook’s IPO, where the mered. But when it’s all over, you equities back up to very high levels. Trading price rose on its debut may see a dead cat bounce in the CATS IN MOTION affecting consumers. volumes have been particularly light thanks Recently, citing the rebound of strug- to the Olympics, and there is little reason to In the US, shoppers have been gling BlackBerry producer, Research expect them to pick up significantly now that commenting, for some time now, on how in Motion (RIM), UBS warned of the we have the rest of the summer to get food and other consumables are being sold in dangers of reading too much into through. On top of this, stock market smaller packages while the purchase price the dead cat bounce. In a research volatility is languishing at five-year lows. remains unchanged. The effects of rising soft note, UBS stated that the modest While this may suggest that investors are commodity prices has also not gone rebound in RIM’s stock price reflects comfortable buying equities at current levels, unnoticed in China, where the proportion of increased optimism about potential it is also a warning of a high level of market income spent on food is greater than in M&A deals – the most recent rumour complacency. developed countries. China Daily reported is that IBM has taken an interest in US economic data releases continue to that the authorities are set to release corn RIM’s network operations – as well as paint a mixed picture. The latest non-farm and rice from state reserves to help tame potential asset sales, cost cutting and payroll number was better than expected, food price inflation and reduce imports from partnership opportunities. The note although an increase of 163,000 jobs is still the drought-hit US. It is also worth noting stated: “Nevertheless, we see operat- some way below the 200,000-plus readings that the People’s Bank of China resumed ing losses and no major catalysts that we saw in the first quarter of the year. reverse repo transactions last Thursday. This over the next two quarters and Last week’s retail sales number convinced indicates that there are no immediate plans remain on the side lines as we believe the company’s future likely many analysts that the US consumer is back, to cut the Required Reserve Ratio. So the expectation of imminent monetary stimulus hinges on a favourable BlackBerry 10 and that a pick-up in spending will feed product launch early next year.” through to stronger GDP growth. But the has been dampened, despite the rhetoric from the Chinese authorities. The problem with dead cat bounces latest data has also reduced the likelihood of is that they tend to be observed in further intervention from the Federal Reserve Yet speculation over the likelihood of further central bank intervention remains hindsight rather than spotted at the at its September meeting. All of this, time. This isn’t to say that spotting a high. Investors are looking ahead to the however, has done nothing to halt the equity dead cat bounce is a waste of time (or market’s rally – investors are once again Jackson Hole Economic Symposium at the Reseach in Motion cats). But traders shouldn’t be buyers anticipating a US recovery, while end of this month. Despite doubts that the US just because they see a retracement. simultaneously expecting the European economic outlook is bad enough to warrant $ Traders should ask whether the Central Bank (ECB) to grab hold of the further Fed action, many investors still hope 11.5 move might be a temporary retrace- stimulus baton. The ECB is viewed as having for a repeat of events in 2010, when Ben 11 ment before Tibbles heads back the available firepower, together with Bernanke signalled that a second round of 10.5 towards terra firma. enough reason, to hose more liquidity into quantitative easing was imminent. But, in the 10 The physicist, Erwin Schrödinger, the financial system. absence of a financial catastrophe, and with 9.5 devised a famous thought experi- the US presidential election less than three Not only that, but investors also expect the 9 ment to show the uncertainty of months away, the Fed may prefer to hold off People’s Bank of China to ease further. At the 8.5 matter uncovered by quantum from a third round of quantitative easing and mechanics (his cat was both dead beginning of last week, Chinese Premier Wen 8 Jiabao said that China faces headwinds, but let “Operation Twist” take the strain. and live at the same time). Like 7.5 Schrödinger’s cat, traders sometimes 7 have an equally tough decision in Dow Jones Industrial Average determining whether the company Jun2 012 Jul2 012 Aug2 012 they are trading is dead or alive (or both). k 13,257.74 Beware of a cat that bounces back 14 20 Aug 13 12 THE TIPSTER Diageo set to toast sales 11 HE international spirits maker six consecutive weeks. This follows a means that it will still be in the rail torrid period from mid-March, where the business along with other transport 10 and brewer, Diageo, will report earnings on Thursday. Currently stock fell from 390p to 310p in early July. ventures. The upcoming interim 9 on the cusp of buying Jose Poor second quarter results showed a management statement may help propel T decline of 2.8 per cent in like-for-like the share price beyond the 52-week high. 8 Cuervo tequila, the share price sales, triggering the exit of Kate Bostock, Interactive Markets quotes 297.7-298.5p has increased by 13 per cent over the last 7 the executive director of general for Stagecoach. six months and 50 per cent year-on-year. merchandise. The recent rally in M&S BSkyBis a company favoured by As with its last earnings report, it appears 2008 2009 2010 2011 2012 shares has been on speculation that a investors. The company recently learned that the majority of revenue for the £6bn bid is in the offing. However, the that it does not have to offer its flagship company will emanate from emerging share price has spent the majority of the sports package at a discount, after markets. Operating profit before last three years trading in a range of 300p winning an appeal against industry facebook.com/fx360 twitter.com/fx360 exceptional, one-off costs should be more to 400p. GFT’s latest price is 365.14- regulator Ofcom. The stock has rallied than £3.1bn against nearly £2.3bn last 365.95p. ever since News Corp dropped its fx360.com year. CMC’s price for Diageo is 1694.65- Virgin Rail may have lost its franchise takeover bid and, at a price of 770p, there 1698.36p. for the West Coast mainline, however its is notable upside potential. Spread Co The contents of t his column are provided for general information purposes only. One should consider the appropriateness UK retail darling, Marks & Spencer, partner, Stagecoach Group, has held quotes 767.2-768.2p for BSkyB. of the information in light of their own objectives, financial situation or needs before trading. CD11UK.074.010612 has seen its share price close higher for up well. A diversified services portfolio YOGESH CHANDARANA TUESDAY 21 AUGUST 2012 15

Technical analysis isn’t infallible But it can work as part of a wider trading strategy, says Craig Drake

F YOU talk to particularly does not encounter resistance at tum. Similarly, when volumes drop, dogmatic technical analysts, you 1,000p, rather than at 999p, because it can be seen as a sign that the wind I often come away with the that resistance has a scientific basis. has gone out of the sails of a stock feeling that their idea of the It encounters resistance at that level and that a reversal could be on the perfect trader would have zero because there are a lot of humans horizon. contact with the outside world – no sat at their computers who think Of course, there are downsides to City A.M., no Bloomberg and no that if the stock falls below that this kind of approach. Technical Twitter. The ideal trader would point it is going to keep on falling, analysis of charts is, by its very instead fuel themselves on but if it stays above that level then nature, a backwards-looking Fibonacci retracement points and everything is going to be ok. approach. And, as the disclaimer takeaway pizza. And though some may trade purely goes: “past performance does not But though it can be a useful tool on technicals, there are many strate- guarantee future performance”. for gaining a clearer picture of a gies that work well which combine Charts don’t take into account an stock’s potential future actions – fundamental and technical analysis unexpected poor earnings report, for based on its past performance – tech- with risk management. For example, example, though they may indicate nical analysis is not a foolproof or when you are looking at a stock, it that that report has been leaked to infallible method of making money can be handy to know whether there the market. from the markets. And, despite the is a bulk of other investors who are While there are limitations to both way a lot of technical studies of thinking along the same lines as technical and fundamental analysis, charts are presented, technical you. Volume indicators, such as oscil- if you want to be a profitable trader, analysis is not a science. You don’t lators, can help to give you greater understanding the limits of both get many hedge funds taking on bil- insight into a stock, reinforcing your can be the difference between suc- lions in investment because they’re views on its fundamentals. Traders cess and failure. By combining the running an algo on Elliott waves. will often watch for a sudden spike two, you can gain a much clearer But technical analysis is a useful in volume for an indication that an and well-rounded picture of the mar- There’s more to trading inspiration than a technical chart and pizza study of human behaviour. A stock identified trend is gaining momen- kets, and where they will go next. ANALYST PICKS CURRENCY STRATEGIST STRATEGIST CHIEF STRATEGIST CHRIS VECCHIO ILYA SPIVAK JOHN KICKLIGHTER

My pick: Short Aussie-dollar and Aussie-Kiwi, buy dollar-yen dips My pick: Stay short Aussie-Canadian dollar My pick: Short Aussie-dollar, long euro-Swiss franc Expertise: Fundamental and technical analysis Expertise: Global macro Expertise: Fundamental and technical analysis Average time frame of trades: A few hours to a few days Average time frame of trades: 1 week to 6 months Average time frame of trades: 1 day to 1 week

I took profits on my core Aussie dollar-dollar short from I sold Aussie dollar-Canadian dollar at Ca$1.0441 last week to Range trading sterling-dollar proved ideal last week, and $1.0585 last week, and the pair was reshorted at $1.0450 as it gain exposure to expectations of slower Chinese growth against there is a need for both range and breakout options this appears a top has been carved out. Meanwhile, a string of accelerated US economic expansion. The trade was triggered as week. Sterling-dollar is still a strong candidate (between better than expected US data has significantly curbed the prices broke support at the bottom of a rising wedge chart $1.5750 and $1.5550). I also like euro-dollar and sterling- likelihood of more quantitative easing, as evidenced by price pattern, after completing a bearish evening star candlestick Canadian dollar setups. I think risk aversion will prevail and action seen in the precious metals markets and the dollar- setup. The initial target is Ca$1.0281. Prices are making Aussie dollar-dollar below channel at $1.04 would be ideal. yen. Accordingly, although profits were taken, the dollar-yen downside progress and I will continue to hold the trade. A stop- For non-risk dependency, I will stick with euro-Swiss franc should be bought on dips. loss will be activated on a daily close above Ca$1.0598. and I like Aussie dollar-New Zealand dollar below NZ$1.3050. TUESDAY 21 AUGUST 2012 16 TV LISTINGS cityam.com

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16 10 25 11 36 17  SUDOKU KAKURO 13 14 13 11 21    23 5 Place the numbers from 1 to 9 in each empty cell so that 11 Fill the grid so that each   each row, each column and each 3x3 block contains all the 17 29 block adds up to the total 44 34 numbers from 1 to 9 to solve this tricky Sudoku puzzle.   in the box above or to the 33 7 24 left of it. 4 11 10     You can only use the 28 21 digits 1-9 and you must not 45       use the same digit twice in 20 5 17   a block. The same digit may 8 15    41 occur more than once in a   6     row or column, but it must 10 3 be in a separate block. 7 13 6  12 22    7 9 8

    ACROSS DOWN 1 Washtub (4) 1 Holy book (5)    3 Talons (5) 2 Expression of WORDWHEEL 6 Unit of length (4) dislike (4)    7 I A Prejudice (4) 3 Winner of a Using only the letters in the Wordwheel, you have 9        Make imperfect (3) competition (8) ten minutes to find as many words as possible, U C 10 Narrow strip of land 4 Place for the none of which may be plurals, foreign words or connecting two larger support and proper nouns. Each word must be of three letters E land areas (7) lodging of the LAST ISSUE’S or more, all must contain the central letter and O N 12 At all times, poetically (3) poor (9) letters can only be used once in every word. There 13 Son of Noah (3) 5 Firm open- SOLUTIONS KAKURO is at least one nine-letter word in the wheel. T D 14 Covered entrance weave fabric to a building (7) used by window- 15 QUICK CROSSWORD 88 77 33 99 11 22 44 Colourful carp (3) cleaners (5) 16 8 33 4 11 2 5 99 77 88 SUDOKU          In the month preceding Small firearm (3,6) S S U B M I T L KK 5 9 4 1 6 8 2 3 7 this (abbr) (3) 11 P P R R E A S O NN          With unflagging 4 4 8 6 88 99 44 99 O OB O E I I RR          18 Thin slivers of wood (7) vitality (8) R R O S P E C I E SS 11 6 5 22 77 99 11 55          20 Club (3) 15 Skewered meat A A N K L E D R A PP 2 6 55 11          21 Depend (4) dish (5) D D L RA G R EE 3 2 4 1 6 8 2 552 WORDWHEEL I I V YY V E L I D EE          17 9 9 7 8 9 5 1 33 22 Plant cultivated for Aromatic herb (5) C C O N F E S S T DD          8 3 9 2 5 11 66 4 77 its oily beans (4) 19 C C U O G A P SS The nine-letter word was Item used to          C C A N N E D T UU 2 11 33 7 22 9 3 88 IGNORAMUS 23 Beaks (5) carry many cups L L D A S L E E PP 1 5 8 8 3 8 99          24 US university (4) at once (4) TUESDAY 21 AUGUST 2012 18 cityam.com LIFE& STYLEHEALTH Create your own personal EGACY is the buzzword du jour. Will t he government be L able to translate the success of the Olympic Games into future sporting prowess? Or, like the Australians, will we crumble into mediocrity? Will our legacy be greater soci al cohesion? Can we become a fi tter, healthier, less obese nation? These are al l reasonable questions but they aren’t much OLYMPIC LEGACY good if you actually want to play Where can I do it? some sport. Thankfully, London is 2020 archery offers a range of times packed with clubs offering and days to take part in target beginners a cha nce to try t heir archery, alternating between the hand at whatever Olympic downside centre in London Bridge challenges they can think of. and Southwark Academy school in Whether wa tching the Ga mes has Bermondsey (2020archery.co.uk). whetted your app etite for fencing, For those wishing to take part in archery or high diving, there are field archery, head to the London plenty of ways to get involved. Archers Club. During the summer If you’re not already a serious months tuition takes place at the athlete, it might be too late to Linford Christie stadium compete in Rio but if you want to (londonarchers.com). have some fun while you get fit, here are some tips on creating HIGH DIVING your own personal Olympic What do I need? legacy. A pair of trunks is advisable. How much will it cost? FENCING Ilford Diving Club offers lessons for What do I need? as little as £5 for an hour and a half M Beginners don’t really have to A session. As clubs tend to book the Y worry abou t supplying t heir own I T entire pool, there is usually no / C equipment as most clubs will N additional entry fee. A have everything available for hire. E Where can I do it? L A T-shirt a nd jogging bottoms A There are clubs all over London, and R should suffice. U most have access to diving boards. A How much will it cost? L While only a handful have full 10m While it may have a reputa tion boards, if you’re a beginner you for being somewhat elitist, won’t be jumping off anything fencing is actually very higher than 5m for a few months reasonable for beginners. Most anyway. Log onto diving-gbdf.com for a clubs will offer a free taster full list of clubs. session, while a 10 week course will set you ba ck around £100. Where can I do it? TRACK CYCLING The Central London Fencing Club at What do I need? Greycoat Hospital School on Regency Comfortable cycling clothes – Street (centrallondonfencingclub.com) preferably lycra. Clubs will rent out has world class coaches and track bikes, specialist shoes and a welcomes beginners. Whether you want to try your hand at fencing, track cycling or high diving, you can be sure London has the facilities helmet. How much will it cost? SHOOTING How much will it cost? ARCHERY regulated distances and set targets. Surprisingly little. Tuition at the What do I need? Membership costs vary depending What do I need? How much will it cost? Manchester Velodrome costs from Clubs will provide the gun and on the club. For a one hour The beauty of archery is that you do Prices vary depending on the club. as little as £10.50 for an hour. usually the cartridges, clay beginner’s lesson, exp ect to pay not need a vast amount of Beginner’s lessons can start from Taster sessions are also available. targets, protective eyewear and £50-£100, which will include all equipment. For the beginner, only £20 for an hour and half, going up Where can I do it? headphones. Headwear is equipment. Free trial days are comfortable clothing is required as to £95 for the weekend. For those The London Velodrome, the scene recommended, with a cap being often granted to beginners. clubs provide all the other gear. starting out, group lessons are of much of Team GB’s glory, is all preferable. Additional earplugs Where can I do it? There are two types of archery that preferable, often bought in booked up for the next few are also needed for extra For clay pigeon shooting, try the one should be particularly aware of; bundles. Once you have reached a months. You can try Manchester, protection. Clothing should be West London Shooting School in target archery and f ield archery. certain level of skill and accuracy, Newport or Calshot. Book early – comfortable and easy to move in. Middlesex (shootingschool.co.uk) or the For those city-based, target archery most wish to have private tuition, track cycling is very, very popular. A padded jac ket helps prevents A1 shooting club at Rowley Green may be the more practical choice as which inevitably costs considerably any reverberation from the gun. (a1sg.co.uk). this can be done inside or out with more. Steve Dinneen and Albany Bell Olympic volleyball player Louise Bawden explains how to get the perfect derrière – and that can lead to over eating FEMALE BEACH volleyball players volleyball player. I have a minor toning moves? because they misinterpret thirst as may be fearsome athletes but they injury to my hip, so it’s really A. Even as a full-time hunger. I’d recommend squats and have also gained pin-up status FIT IN important that my glutes are athlete, diet actually lunges for people wanting to tone thanks to their fantastic glutes. We strong and I do daily exercises to accounts for 70-80 per their glutes. They’re simple and catch up with Australia’s Louise THE CITY train them. Your glutes stabilise cent of my body you can do them any time. Most Bawden to talk Games, genetics what your legs do and create the composition – the weight people don’t do them deep enough and, of course, bums. power when you jump. I’m in the to muscle ratio. I still so it’s important to really get down LAURA WILLIAMS gym every single day and I lift can’t eat what I want, so into a 90 degree sitting position. Q. Beach Volleyball seems to be FITNESS & DIET EXPERT weights three times a week. We anyone looking to tone up played on the whole by long, lean all spend a lot of training time and lose weight really needs Q. Any suggestions for how office- athletes. Is it fair to say there’s a sand. You’ve got to be able to jump in the sand and it’s important to take a close look at bound, city dwelling readers could beach volleyball body-type and is it up from the sand and it’s not to keep the level of fitness we their diet. I think it’s have a crack at beach volleyball genetic? necessarily the tallest girls that are need. We do cross-training, work mainly about portion without boarding a plane to Oz? A. It’s definitely a benefit to have the best at that. out in the gym and jog. control and thinking A. There are sand courts in the UK; height (Louise is 6ft 1in) but it about the nutritional the British Beach Volleyball depends on which position you Q. Most beach volleyball players Q. For the City A.M. reader who’s value of what you’re Association (beach-volleyball.co.uk) play in. If you’re blocking then yes, have gorgeous glutes Do you do any still hopeful of rocking a pair eating. When we’re will be able to tell you where your height is important, but if you’re particular bottom training? of bikini bottoms/Speedos on training we keep a food nearest courts are. Also visit the defending it’s as important to have A. Your bottom is a highly the beach this year, what diary, which is reviewed by a London Beach Volleyball Club who agility, leg strength and the ability functional part of your body – even would your advice be and nutritionist. Most people are have courts all over London to change direction quickly in the more so for me as a beach what are your fave butt- also low on water – dehydrated (londonbeachvolleyball.org). TUESDAY 21 AUGUST 2012 19

Sergio Garcia’s Wyndham SPORTcityam.com/sport @cityam_sport Championship win secured him a Ryder Cup team place Rugby chiefs Ferguson feels Fellaini’s hand video ref greater power

BY FRANK DALLERES

VIDEO replays are to be used more force as United lose face widely this season in top flight English rugby, with referees able to ask the television match official to PREMIER LEAGUE look for any fouls he may have missed leading up to a try. EVERTON...... 1 The expansion of their responsibility from ruling solely on MANCHESTER UNITED ...... 0 the grounding of the ball will apply only to live televised matches and BY DECLAN WARRINGTON was confirmed yesterday by Premiership rugby chiefs. In another rule change, players MANCHESTER United manager Sir suspected to have been concussed Alex Ferguson refused to blame his will be forced to leave the pitch and makeshift defence after Everton be replaced with a temporary began their season in uncharacteristi- substitute while they undergo cally promising fashion with a vital immediate health tests in a pitch- home victory. side concussion bin. A headed goal from the immensely impressive Marouane Fellaini gave David Moyes’s men a well-deserved win on a night where their uninspira- tional visitors looked some way short Mourinho ‘no’ of their match-winning best and failed to fashion an almost- routine comeback against their unfancied opponents. to Three Lions “Centre-back is a problem but we coped quite well, I don’t think you BY FRANK DALLERES can criticise their performance in that respect,” said Ferguson, whose Marouane Fellaini (left) headed Everton’s winner on a miserable debut for Robin van Persie (below) REAL Madrid manager Jose side now trail title rivals Manchester Mourinho has ruled out taking the City and Chelsea by three points. “It towards the match’s start. scenting the oppor- corner, it served both as confirmation England job one day, saying the only was just difficult to handle him when Goalkeeper David de Gea, tunity presented by of an anticipated weakness and as a international team he would coach they were knocking these balls up continuing the fine form the absence of the microcosm of that that had ultimate- is his native Portugal. to [Fellaini]. with which his first season injured Rio ly won the game. The ex- Chelsea boss flirted with “Michael [Carrick] did fine, good on ended, produced several sen- Ferdinand, Chris The tenacious Phil Jagielka became the role in 2007 and has stated his the ball and applied himself well, sational saves to dismiss the Smalling, Phil Jones key when clearing off the line from desire to work in England again, but they all applied themselves well. danger posed by promising and Jonny Evans – United midfielder Tom Cleverley but said: “It’s a job that makes people “We played good football, good efforts from Steven Pienaar, sought to maintain an when £24m signing Robin van Persie proud, especially if you do it with combination play, on another day we Leighton Baines and Leon aerial pressure on under- arrived from the bench the away your own country, and I’ll do it with would have won the match.” Osman, and was only beaten study Michael Carrick and side’s anticipated, glorified comeback Portugal because I think Portuguese Though Everton were the ones defi- when a headed effort from when the impressive simply failed to materialise. people wouldn’t understand if I did antly defending by the end of the the latter menacingly struck Fellaini jumped beyond The striker did little as an influ- it with another country. I don’t evening, it was the away side who against the bar. him to powerfully head in ence throughout and Everton simply imagine myself in the World Cup were perhaps the more fortunate The home side – possibly from Baines’s 57th-minute negated any remaining United threat. playing against Portugal.”

IN BRIEF Strauss vows to remain captain Pardew charged with misconduct for the 2013 Rowing World Cup. “This event will help bring thousands of new n FOOTBALL: Newcastle manager Alan fans to the sport,” said Hugh Robertson. Pardew has been charged with misconduct by the FA after pushing a Yanuyanutawa signs for Exiles despite England’s dethroning linesman during his side’s 2-1 win over Tottenham on Saturday. He faces a n RUGBY UNION: London Irish have BY FRANK DALLERES (37) also kept faint comeback hopes over that mace to South Africa but touchline ban but has until 4pm on signed Fiji prop Jerry Yanuyanutawa. alive. right at the moment they deserve to Thursday to respond to the charge. CAPTAIN Andrew Strauss Prior’s wicket, a fifth for Vernon be No1 and we’ll come back.” McEachran agrees Boro loan insists he is the right man to Philander, spelled the end for Strauss reserved special praise for Eton Dorney to host World Cup return England to the top of England in a match overshadowed Bairstow, who was drafted in as n FOOTBALL: Chelsea midfielder Josh n ROWING: London 2012 venue Eton the Test rankings after their by the omission of batsman Pietersen’s replacement following McEachran has joined Middlesbrough on Dorney has been awarded host status stirring attempt to keep that Kevin Pietersen, but Strauss his axing for sending text messages a season-long loan deal. title out of South African believes he can lead them to South Africa players. clutches ended in defeat at back to No1 spot again. “He played outstandingly well,” Lord’s yesterday. “I hope so,” he said, when Strauss added. “He came into the A 51-run loss asked if he was the man for game under quite a lot of pressure, confirmed a 2-0 th job. “We’ve had some given the circumstances, and the Results series reverse, a tough times and I calm method and great ball-striking :I@:BC8E;1=`ijk@ee`e^j*(,9X`ijkfn0, (-$+$-($(#BXcc`j(($)$,'$(#KX_`i)+$*$//$(% Ldg`i\j1?;_XidXj\eXJKXl]\c% seemed certain defeat. stuff. When you’re No1 people Jonathan Trott’s steady 63 saw the JFLK?8=I@:81J\Zfe[@ee`e^j*,( 8dcX()(#=`ee+$.+ C8E;1J\Zfe[@ee`e^j =FFK98CC Matt Prior top scored with try to gun you down and we’ve hosts through the early losses of Ian Fm\ie`^_k(-$) a swashbuckling 73 as he come unstuck a few times, Bell and then James Taylor, before @KifkkZBXcc`jYJk\pe%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%-* 98I:C8PJGIL< and Graeme Swann, who we’ve learned a lot along the Prior and Swann got Lord’s roaring. @9\ccZJd`k_YG_`cXe[\i%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%+ 9PC<8>L< DGi`fiZJd`k_YG_`cXe[\i%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%.* while Jonny Bairstow Prior hit 73 as England mounted to snuff out the challenge and end J9ifX[Z8dcXYBXcc`j%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%*. JKF98IKJLGL< (54) and Stuart Broad an unlikely comeback attempt England’s year at the top. >JnXeeileflk%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%+( N`^Xe%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%*/ JXc]fi[%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%-