Monday Papers: Greece’s creditors seek end to deadlock

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by Himanshu Singh on Jan 16, 2012 at 04:02

Top stories

• Financial Times: Greece’s international creditors are considering an appeal to the French and German leaders to break a deadlock in negotiations over the size of the losses to be taken by banks and other bondholders as part of a €100 billion deal seen as crucial to bringing the country’s debt under control.
• Financial Times: “Shadow banking”, which include corporate bond sales and direct lending by hedge funds, must be dragged into the harsh light of day and both it and global banks must be forced to serve the real economy, says Mark Carney, chairman of the Financial Stability Board.
• The Daily Telegraph: Global markets are set for a rocky day of trading after German leader Angela Merkel warned that it could take many months to rebuild confidence in the eurozone and schisms over financing the bloc’s bail-out fund re-emerged.
• The Independent: Britain is already in the grip of a double-dip recession and the economy will not pick up until 2013, according to the Ernst Young Item Club and the Centre for Economics and Business Research.
• Financial Times: The debate over Alex Salmond’s push for referendum on Scotland’s independence has raised questions over how much oil and gas remains in the North Sea and how it would be divided between England and ¬Scotland.

Business and economics

• The Daily Telegraph: Eurozone lenders’ borrowing of long-term central bank funds is expected to more than double to over €1 trillion next month when struggling banks will be handed another lifeline by European authorities, according to Credit Suisse.
• Financial Times: Faltering performance from Goldman Sachs, Morgan Stanley, Citigroup and Bank of America, all of which report fourth-quarter earnings this week, could dent optimism over the pace of corporate recovery in the US.
• The Guardian: Senior directors who set boardroom pay are being summoned to the UK business department this week as part of the latest effort by Vince Cable to clamp down on executive pay.
• Financial Times: Saudi Arabia is expected to allow foreigners to invest directly on its $340 billion stock market for the first time later this year.
• Financial Times: Already feeling the stress of the eurozone debt crisis, European banks now face further strain in Hungary, where deteriorating public finances and hostile government policies are testing their appetite for a once-lucrative market; western European lenders control about 80% of the Hungarian banking sector.
• Financial Times: A group of dealmakers at Royal Bank of Scotland, including its head of corporate finance, are considering a management buy-out as the state-controlled bank looks to sell or shut down its advisory business.
• The Guardian: Andrey Prokhorov, a tiny shareholder in BP’s Russian joint venture TNK-BP, is fronting a minority shareholder action against BP following the UK-listed firm’s failed efforts to sign a separate Russian partnership with the state oil group Rosneft last year.
• Financial Times: Rockhopper Exploration has started work on plans to find a partner to develop a big oil discovery in the South Atlantic, in a move which may also lead to a sale of the Aim-listed explorer.
• The Independent: ENRC, the mining giant at the centre of corporate governance storms, has agreed to hand over details of an internal investigation into its activities to the Serious Fraud Office; the SFO has been pressing for ENRC to voluntarily report on the investigation which focused on activities in Kazakhstan and information regarding a mine in Congo.
• The Guardian: Shell is to shut its main UK research and development base and transfer the work overseas in a bitter blow to Britain’s knowledge economy.
• Financial Times: JD Wetherspoon, the high-street pub company which originally intended to open 50 pubs this year, says it may scale back its 2012 expansion plans in the face of “punitive” tax increases by government.
• Financial Times: The Co-operative Bank, one of the UK’s few self-proclaimed ethical lenders, is looking to significantly increase the number of mortgages it provides to buy-to-let landlords, a group accused of fuelling the recent property crash.
• Financial Times: The shipwreck of one of Carnival Corp’s vessels off the coast of Italy over the weekend could cause the company to lose at least $200 million and wipe more than 10% off this year’s profits.
• Daily Mail: Glencore is facing legal action over pollution caused by its vast and lucrative copper operations in Zambia.
• Financial Times: The White House has spoken out against proposed legislation intended to reduce online piracy, inviting a strong response from Rupert Murdoch and fuelling a battle between the technology and entertainment industries.
• Daily Mail: Multinational conglomerate Hutchison Whampoa is suing Revenue Customs in an attempt to offset losses from the launch of its Three mobile venture against profits it made elsewhere, in an attempt to reduce its tax bill.
• Financial Times: Value Retail, the European outlet chain, achieved record sales of €1.5 billion, up 20%, across its nine outlet villages in 2011 including those in Ireland, Spain and Italy.
• Financial Times: A steep drop in festive Christmas and New Year text messaging this year was the latest sign of the decline in such traditional business for telecoms operators in many European countries.
• The Daily Telegraph: AstraZeneca has established a new research team tasked with pursuing partnership deals as the drug maker strives to bolster its pipeline of new medicines at a lower cost.
• Financial Times: The board of 18 Guernsey-listed investment vehicles is suing London-based Arch Financial Products, a fund manager, for £150 million after an affair that left 10,000 small investors nursing heavy losses.
• Financial Times: Royal Bank of Scotland, majority-owned by the UK taxpayer, was pressed on Sunday night to back a deal to save Peacocks, the heavily indebted value fashion retailer.
• The Independent: The serviced office group Regus has struck a deal with the oil giant Shell that could see its business lounges opened on petrol forecourts across Europe.
• Daily Mail: Macdonald Hotels, Scotland’s biggest hotel operator, is unlikely to find that its latest figures will make talks easier with lenders on refinancing debts of £341 million.
• Daily Mail: A series of disposals has left IPGL, the investment vehicle owned by former Conservative party treasurer Michael Spencer, with £29 million, which it plans to spend on acquisitions.
• Financial Times: Discount shoe chain Barratts Priceless Shoes is to make a further 680 staff redundant after its founder, Michael Ziff, struck a deal with administrators to save the rump of its remaining high street stores.

Share tips, comment and bids

• Financial Times: Three of Europe’s biggest oil companies – Total, Statoil and Maersk Oil – are set to vie for Anadarko Petroleum’s Brazilian business, valued at more than $3 billion.
• The Independent: Gulf Keystone Petroleum has invited bidders to build a pipeline that would allow the much-watched oil gas company to export vast supplies of black gold from its key Kurdistan field.
• Financial Times: Distressed debt investors are circling General Healthcare Group – which is burdened with a £1.65 billion gross debt – in expectation that the UK’s largest private hospital operator by revenue will be forced to restructure its heavily indebted financial set-up.
• Financial Times: Virgin Atlantic is calling for competition authorities in the UK rather than Brussels to scrutinise International Airlines Group’s proposed purchase of BMI British Midland, in the hope that British regulators will be more inclined to block the deal.
• Financial Times: Investors in NYSE Euronext and Deutsche Börse are lobbying EU politicians to override a recommendation by EU antitrust staff that their plan to create the world’s largest bourse would stifle competition in European derivatives markets, and should not proceed.
• Financial Times (Comment): If the Strait of Hormuz were blockaded, the sharp fall in the UK’s gas supplies would be the country’s single most critical issue
• Financial Times (Comment): After leading the way in voluntary deficit reduction, the UK is now enduring a prolonged period of near-stagnation
• The Guardian (Comment): A three-way game of bluff is taking place in Athens this week but, the Greeks will come off worst, whatever the deal.
• The Guardian (Comment): Europe and the eurozone are strangling themselves with a toxic mixture of austerity and a structurally flawed financial system
• The Daily Telegraph (Comment): Will printing more money solve Britain’s ills?
• Financial Times (The Lex Column): Japan: there is a lot to say for preserving jobs but unproductive employment helps no one in the long run
• Financial Times (The Lex Column): Deutsche Bank: the fact is that banks never needed to own asset managers to do business with them in the first place
• Financial Times (The Lex Column): Carnival Corporation: the operator has been resilient but in the latest downturn, it faces similar pressures to any other business exposed to discretionary spending

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