Monday November 16, 03:01 AM
Glance-PRESS DIGEST - Financial Times - Nov 16
BIG BUILDERS YET TO FEEL EFFECT OF STIMULUS
A report from KPMG to be published on Monday will reveal
that only 15 percent of leading international construction
groups say that they expect state intervention into the industry
will provide
significantly greater opportunities over the next
year. In Europe, Britain and the United States, the figure is
even lower, with only 10 percent of respondents expecting to see
a marked upside from government spending. In Asia, construction
companies were more confident, with 27 percent expecting a
positive impact. However, despite the scepticism concerning the
impact of government spending, construction companies are
generally positive about the future, with about two thirds
expecting to see profits increasing by the middle of 2010.
PROPERTY GROUPS TO REPORT GAINS IN PORTFOLIOS
Land Securities (LSE: LAND.L - news) and British Land (LSE: BLND.L - news) are to
report this week that the value of their portfolios has risen
for the first time since the start of the real-estate slump. The
UK's two largest property companies are to say that property
values began to rise in the third quarter, confirming that a
recovery in the market is feeding through to the books of the
large real estate investment trusts. However, the tail end of
the slump in the second quarter is expected to weigh on overall
half-year results. Analysts expect Land Securities to show a
fall in its net asset value from 593 pence to 568 pence a share,
while British Land is expected to show a fall from 370 pence to
350 pence.
ADMIRAL SET TO HIGHLIGHT LLOYDS TOXIC DEBT
The restructuring of Admiral Taverns this week is likely to
highlight the toxic legacy that Lloyds Banking Group (LSE: LLOY.L - news)
inherited from HBOS. Lloyds, which has a 855 million pounds
exposure in Admiral (LSE: ADM.L - news) , is expected to agree a debt-for-equity swap
at the pub group just days after the collapse into
administration of property developer Kenmore into which it is
estimated HBOS put at least 700 million pounds in loans and
equity investment. Lloyds is expected to write off as much as
600 million pounds at Admiral which has suffered from tumbling
beer sales.
FORMER GROUCHO OWNER IN 30 MILLION POUND RETURN TO LEISURE
SECTOR
Longshot, the former owner of the Groucho Club, is moving
back into the leisure sector with a pool of 30 million pounds to
purchase distressed assets. The return of Longshot, which
disposed of its last leisure assets in mid-2007, is the latest
sign of investors deciding that the time is right for bargains
to be had in the leisure sector, even though consumer spending
remains uncertain. Longshot, established 15 years ago by Joel (JOEL.TA - news)
Cadbury (LSE: CBRY.L - news) and Ollie Vigors, sees opportunities in buying boutique
hotels and golf clubs, as well as bars and pubs, and merging
some under one roof
.
CANADA PROTEST OVER RBS OIL SANDS ROLE
Canadian aboriginal groups will target Royal Bank of
Scotland and the government this week in an attempt to
stop RBS (LSE: RBS.L - news) lending to companies which invest in oil sands
extraction in western Canada. Campaigners calculate that since
the start of 2007, RBS has extended 13.9 billion pounds in loan
guarantees or debt and equity underwriting to companies linked
to oil sands. They say RBS and other lenders are in breach of
the Equator Principles, the standards for socially and
environmentally responsible lending agreed in 2003. The First
Nations, as the native Canadians are known, argue that their
rights to hunt and fish in the oil sands region of Alberta have
been breached by the pollution created by oil projects.
INVISTA IN 60 MILLION POUND CAPITAL RAISING
Invista is hoping to pay down a sizeable tranche of debt by
raising 60 million pounds through a capital raising. The
raising, the first such move in the European investment trust
sector since the beginning of the global recession, is being
seen as an indicator of growing confidence that the property
market is recovering. In addition to reducing its debts, Invista
will also use a portion of the new money as working capital.
Equity will be split between normal shares and preference shares
issued at 20 pence per share.
GSK PLANS TO CUT DRUG PRODUCTION WASTE
GlaxoSmithKline (LSE: GSK.L - news) has pledged to reduce waste
generated by drug production by two thirds in a bid to cut costs
and improve its environmental record. Current industry levels
allow up to 100 kg of raw material to be generated for every kg
of 'active pharmaceutical ingredient', but GSK hopes to slash
the larger figure to just 30kg by 2015. Speaking of the group's
decision, Glaxo's vice president for environmental health and
safety, Jim Hagan, said: 'It was the idea of sustainability that
drove the idea. You make an improvement to the environment and
you achieve a reduction in costs.'
OVERSEAS INVESTORS TARGET ALTIUM AND SEYMOUR PIERCE
Altium Capital and Seymour Pierce have separately entered
into discussions with potential foreign investors interested in
purchasing either a part or all of the business. However, people
close to the matter have suggested that the talks have been
brief in light of both private brokers wishing to retain
independence. Former Merrill Lynch banker Marco Capello is said
to be one interested party having lost out in a bid for a stake
in Panmure Gordon earlier this year. Despite recent travails
that resulted in a swing into the red, analysts are predicting
Altium will bounce back thanks to a 123 per cent rise in
securities turnover in 2009.
MERLIN HOPES TO CONJURE IPO MAGIC
Merlin Entertainment is hoping that its forthcoming IPO (IPOA.NX - news) ,
planned for 2010, will go some way to allaying fears among
investors who are still reeling from a number of recent
disappointing private equity-backed deals. The IPO, the first
big listing on the London Stock Exchange (LSE: LSE.L - news) since the credit crunch
took hold, will value the company at two billion pounds and is
likely to follow announcements of the appointment of a chairman
and non-executive directors. Blackstone (NYSE: BX - news) , which owns a little
more than 50 per cent of Merlin, believes this particular
offering differs from other recent listings since the theme park
operator does not have to urgently tend to its one billion pound
debts. The company has in fact enjoyed eight consecutive years
of double-digit earnings growth before interest, tax,
depreciation and amortisation.
JOHN LEWIS STORE MAKES CAPITAL GAINS
Retailer John Lewis has exceeded expectations for its store
located in the St David's 2 centre in Cardiff, with performance
up six percent on projected figures in the seven weeks since it
opened. The news is a boost for John Lewis, having been forced
to postpone six outlets at the start of 2009. Retail analyst
Nick Bubb suggests the success of John Lewis's only Welsh store
is indicative of a 'revived consumer interest in household
goods, which account for two thirds of John Lewis's sales'.
David Barford, director of selling operations at the retail
group, erred on the side of caution, stating: 'It would be naive
to think the consumer is out of the woods. We've got some
challenging months ahead as we move into 2010.'
Prepared for Reuters by Durrants
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