Cityam 2011-11-14

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17 0.03 /$ 1.38 +0.01

EUs Monti
named as
Italian PM
MARIO Monti, former European
Commissioner, was appointed Prime
Minister last night by Italian President
Georgio Napolitano.
He replaces Silvio Berlusconi, who
lost his majority in parliament last
week during a vote on a routine
finance bill and resigned on Saturday.
Markets and Eurozone leaders hope
Monti will usher in a period of calm
after the panic of the last few weeks.
Monti, who previously worked for
Goldman Sachs, was appointed sena-
tor for life by the President last week.
His role is to push through fiscal and
structural reforms to stem the crisis
hitting the country and boost its long-
term competitiveness.
The president of the republic has
received Senator Mario Monti and con-
ferred a mandate to form a govern-
ment, the presidential palace
announced in a statement.
He is expected to form a govern-
ment of technocrats other expert
Eurozone insiders who are deemed to
be above the politics that led to paraly-
sis and a lack of the reforms necessary
to save Italy from the deepening crisis.
The unelected Monti will have to
gain backing from a majority of parlia-
mentarians. So far the centre-left
Democratic Party has backed him, and
Berlusconis PDL has offered condition-
al support. We must be united facing
a crisis that was not born in Italy, not
born out of our debt or our banks,
Berlusconi said yesterday.
ALLISTER HEATH: P4
BY TIM WALLACE
EUROZONE
Chancellor George Osborne is on the lookout for good ideas to stimulate growth without spending cash Picture: REUTERS
CHANCELLOR George Osborne is in
talks with institutional investors about
getting private cash to fund billions in
infrastructure projects as part of a des-
perate bid to get the economy moving
despite the global debt crisis.
Among the ideas being mulled by
HM Treasury is the establishment of
an infrastructure investment fund to
channel private money from pension
and mutual funds into building toll
roads, houses and power plants.
Adam Marshall, policy director at
the British Chambers of Commerce,
told City A.M.: A single investment
vehicle is a possibility, though it may
be a single fund or several project by
project, or sector specific.
But he added that the initiative
needs to include a deregulation of
planning, with separate approval from
ministers for major projects to create
an attractive investment environment.
The scale of the potential funds is
also not clear despite reports suggest-
ing that Osborne could target 50bn
over an undetermined time period.
The infrastructure focus will form
one part of a broader package that the
Treasury hopes will stimulate growth
while sticking to its deficit reduction
plan.
Among the other measures likely to
be in the growth package unveiled in
two weeks are:
A credit easing scheme that will
OSBORNE IN HUNT
FOR GROWTH PLAN
BY JULIET SAMUEL AND TIM WALLACE
POLITICS
www.cityam.com FREE
LONDONS
NEW LOOK
BUSINESS MAP OF
CAPITAL GETS
RE-DRAWN P14
A NATION REMEMBERS
BRITAIN COMMEMORATES
THOSE WHO FELL IN WAR P8
BUSINESS WITH PERSONALITY
channel public money into small busi-
ness loans to cut the cost of credit. As
City A.M. revealed on Friday, banks have
pitched a 4bn scheme, with the gov-
ernment fronting up to 800m.
However, both banks and Bank of
England executive director Andrew
Haldane argue that it is more impor-
tant to adjust capital rules so that
lending to small firms is more attrac-
tive for banks in the long-run.
A partial merger of national insur-
ance and income tax to simplify firms
tax returns and make the true rate of
tax more transparent.
Some tax relief for energy-intensive
firms, as revealed by City A.M. last
month. This could involve exempting
some from the floor on carbon pricing.
An overhaul of the planning system
to create a presumption in favour of
letting projects go ahead.
Employment law reforms to make
hiring people cheaper. But the Liberal
Democrats have vowed to temper
Downing Streets central policy recom-
mendation, which is to let firms get
rid of workers for being unproductive.
Another possibility is that the
Treasury acts on talks with banks over
tweaking the UKs liquidity rules to be
less strict by, for example, indicating
behind the scenes that it would be sup-
portive of a more liberal Bank of
England governor when the time
comes to replace Sir Mervyn King.
Issue 1,510 Monday 14 November 2011
Certified Distribution
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News
4 CITYA.M. 14 NOVEMBER 2011
UKs plan to
cut sick bills
WHITEHALL Mandarins are under-
stood to be close to finalising a deal
aimed at cutting the UKs 13bn sick-
ness absence bill.
Officials hope to have new rules
ready by the end of the month to dis-
courage sick leave, including
enrolling workers on a health insur-
ance scheme.
The plan could see workers as
well as employers pay health insur-
ance contributions, but they would
then have quick access to occupation-
al health services, in theory speeding
up their recovery and getting them
back to work quicker.
The recommendations are likely
to be made following a review led by
former director general of the
British Chambers of Commerce
(BCC) David Frost.
Insurance companies could also be
liable for long-term sickness bills, sav-
ing the public purse or employer con-
tributions.
Under Frosts leadership, the BCC
campaigned for the government to
reduce the burden of regulation in
the UK, while also throwing its
weight behind the plans to reduce
Britains large public deficit.
John Longworth, a former senior
executive at both Asda and Tesco,
was named as successor over the
summer.
BY STEVE DINNEEN
HEALTH
Even Super-Mario may not save Italy

THEY call him Super-Mario, for rea-
sons that arent quite clear. But Mario
Monti, Italys non-elected new prime
minister, will certainly need super-
powers if he is to save Italy from ruin,
and prevent a major recession in the
Eurozone and hence in the UK. Italys
main problem is that its economy has
barely grown since joining the euro
and that its costs have soared, pricing
it out of world markets. Unless costs
(including real wages) are slashed,
spending hacked back and real free-
market reforms imposed to boost pro-
ductivity, Italy will face Armageddon.
Yet in theory at least, Montis job
shouldnt be impossible. While Italys
national debt is dangerously high, its
budget would be in surplus without
debt interest payments. Italys private
sector is not excessively leveraged: pri-
vate sector debt is just 129 per cent of
GDP, against 211 per cent in the UK.
The problem is the public debt at 120
per cent of GDP, crippling red tape,
corruption, an unreformed public sec-
tor and vast unfunded state liabilities.
Fortunately, the Italian state owns
plenty of assets, from shares in major
companies worth tens of billions to
2,500 tonnes of gold worth 100bn.
The shares could be sold at a good
price , providing much-needed liquidi-
ty. The gold could be used as collateral
for the bond markets, allowing Italy to
raise 300bn, with the first third of
potential bondholder losses in the
event of losses insured.
Let us hope that Monti doesnt go
for the lazy option of a one-off wealth
tax on private households bank
accounts and homes. Italians are
wealthier per capita than Americans
or Germans, but such a move would
be bound to be copied elsewhere and
would reduce the pressure on politi-
cians to sort out their own affairs
violating private property rights is not
the way to go. What is required is a
fair and efficient tax system and a
massive crackdown on tax evasion.
Wealthy Italy shouldnt need an IMF
bailout, or even the monetisation of
its debt by the European Central Bank.
It should refuse all outside help and
marshal its own resources. But that
means painful change, and tackling
the tyranny of the status quo, the
power of vested interests and the sta-
tist/welfarist/corporatist ideology
which has proved to be so powerful at
halting reforms in Europe and
America. Public sector workers will go
on strike at any hint of a shake-up. It is
hard to see how Monti will smash
these obstacles.
He is a distinguished academic
but his decisions while he was a
European Commissioner were decid-
edly mixed. He was right to stop
Germany subsidising Landesbanken.
But his flagship anti-trust case against
Microsoft in the early 2000s did noth-
ing to enhance competition (the inter-
net and innovation from Google and
Apple turned out to be much more
powerful than anything Brussels
could dream up) and helped damage
Microsoft without making consumers
better off. It will go down in history as
a case study in futility. Let us hope he
is more focused on what actually mat-
ters this time around.
Montis task will be to convince the
Italian public to change and the
political establishment to allow him
to push through austerity and supply-
side measures far more radical than
anything Silvio Berlusconi was plan-
ning. There will be lots written about
Montis supposedly super-normal
qualities over the next few days but
the stark reality is that the odds are
massively stacked against him.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
UNIVERSAL expects it will have to
make divestments in some markets
following the acquisition of EMIs
recorded music division by its parent
company Vivendi.
Sources close to the firm told City
A.M. no decisions will be made until
after regulatory clearance has been
granted a process expected to take
between eight and 10 months.
The source said the firm has not
identified which markets are most
likely to be affected, nor which divi-
sions could be at risk.
The source also said Vivendi has no
plans to sell off Universal in the wake
of the EMI deal.
Universal chairman and chief exec-
utive Lucian Grainge told City A.M.:
EMI should be commended for its
resilience over the last few years.
Following the regulatory process,
we plan to reinvest in their artists
and in new music, and preserve the
historic legacy of their past.
BY STEVE DINNEEN
MEDIA
Vivendi to keep Universal

Universal chief executive Lucian Grainge praised EMIs resilience
NEWS | IN BRIEF
Exxon Mobil signs Kurdish deal
Iraqs Kurdish region has signed an
exploration deal with Exxon Mobil, a
Kurdish official said last night, confirm-
ing a deal Iraq has said could jeopardise
the US oil giants southern oilfield con-
tract. Natural resources minister Ashti
Hawrami said the Kurdistan Regional
Government (KRG) signed a contract
with Exxon in mid-October for six
exploration blocks in the semi-
autonomous region. Iraqs central gov-
ernment has said Baghdad would
consider a deal between Exxon and the
KRG illegal and a violation of the com-
panys contract to develop Iraqs 8.7bn-
barrel West Qurna Phase One oilfield.
Japans GDP rebounds 1.5 per cent
Japan's economy grew 1.5 per cent in
July-September from the previous quar-
ter following three quarters of contrac-
tion as exports and consumption
rebounded from a slump caused by the
March earthquake, government data
showed this morning. The quarter-on-
quarter rise was in line with the median
estimate for a 1.5 per cent increase and
follows a 0.5 per cent contraction in the
previous quarter.
EDITORS LETTER
ALLISTER HEATH
Editorial Statement
This newspaper adheres to the system of
self-regulation overseen by the Press Complaints
Commission. The PCC takes complaints about the
editorial content of publications under the Editors
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of City A.M. Please ring 0207 015 1230, or email
distribution@cityam.com
Former BCC director
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has led the review into
ways to cut sickness
absence in the UK
4th Floor, 33 Queen Street, London, EC4R 1BR
Tel: 020 3201 8900 Fax: 020 7283 5334
Email: news@cityam.com www.cityam.com
Editorial
Editor Allister Heath
Deputy Editor David Hellier
News Editor David Crow
Acting Night Editor Marion Dakers
Business Features Editor Marc Sidwell
Lifestyle Editor Zoe Strimpel
Sports Editor Frank Dalleres
Art Director Jo Simpson
Pictures Alice Hepple
Commercial
Sales Director Jeremy Slattery
Commercial Director Harry Owen
Head of Distribution Nick Owen
PRIVATE EQUITY GROUPS BOOST STAKES
IN HOT FUNDS
Investors in the secondary leveraged
buy-out fund market are using further
leverage to finance such purchases,
adding another layer of risk and stir-
ring up memories of the debt-fuelled
private equity boom ahead of the
financial crisis. While private equity
groups in Europe and the US are find-
ing it harder to raise capital, the mar-
ket for stakes in their pre-crisis funds
has become so hot that some investors
have taken on loans to be able to pay
higher prices for such assets.
WELFARE REFORM TARGETS WORKERS
HOURS
Workers claiming state help with
childcare and housing costs will be
expected to seek longer hours, or risk
sanctions that could include loss of
benefits or a requirement to undergo
training, in a radical shift in Britains
welfare system. The proposals will
make it one of the most demanding
regimes in the world, say experts. The
aim is to ensure that people work as
many hours as they can, reducing the
benefits bill for a cash-strapped
Treasury, and, in the process, cracking
down on the black economy by provid-
ing an incentive for self-employed peo-
ple to declare earnings accurately.
EVERYTHING EVERYWHERE TO REPAY
PARENTS LOANS
Everything Everywhere, the UK
mobile operator jointly owned by
Deutsche Telekom and France
Telecom, is planning to pay back
875m ($1.4bn) of loans to its two par-
ent companies in a step towards mak-
ing itself a wholly independent
operation. The group has lined up
seven banks to lend it the money to
carry out the move, according to
bankers close to the process. If the
facility gets final approval, it could be
one of the largest new borrowing
facilities in the UK this year.
RED TAPE PUTS STRANGLEHOLD ON
SELL-OFF OF ROYAL MAIL
Privatisation of Royal Mail will not
begin until at least 2013 and might
not even be complete before the end
of the Governments present term,
well-placed sources have confirmed.
The state-owned national postal serv-
ice faces months of regulatory issues,
all but ruling out any sale, partial or
otherwise, next year.
REDGHOST METERS ADD 15M TO
BRITAINS SWOLLEN GAS AND
ELECTRICITY BILLS
Energy companies are allowing thou-
sands of households to avoid paying
for their electricity and gas leaving
others to foot their bill. According to
figures obtained by The Times, about
20,000 households and businesses
have ghost meters that have not
been registered by any energy suppli-
er. The annual cost is around 15m.
BANKS WRITE OFF RECORD LEVEL OF
CORPORATE DEBTS
Britains banks and building societies
have been writing off more of their
corporate debt than at any time on
record, official data shows. In the
three months to June, write-offs of
loans to non-financial corporations
almost tripled to 2.94bn, according
to the Bank of England. The only time
the level of losses had ever come close
was in the fourth quarter of 2009, as
Britain was emerging from recession,
when write-offs were 2.5bn.
TOBACCO SECTOR WANTS FREEZE ON
CIGARETTE DUTY
The tobacco industry has demanded
George Osborne freeze cigarette duty
in this months Autumn Statement
after research found sin taxes dont
encourage people to give up. The
number of smokers in Eastern Europe
did not fall when prices soared.
NOBLE IN TALKS TO HIRE GOLDMAN'S
ALIREZA
One of the top executives of Goldman
Sachs Group in Asia is in talks to
become chief executive of troubled
commodities trader Noble Group,
just days after Goldman announced
that he was leaving the investment
bank, a person familiar with the mat-
ter said. Yusuf A. Alireza is leaving
Goldman after 19 years at the firm
and after just 10 months as co-presi-
dent in the Asian-Pacific region,
excluding Japan.
IBM, CHINESE FIRM FORGE E-COM-
MERCE PACT
International Business Machines and
Chinese electronics retailer Suning
Appliance Co. have struck a deal to
create e-commerce and Web technol-
ogy centres in China and the US. IBM
will help Suning develop a technolo-
gy centre in Nanjing, China.
WHAT THE OTHER PAPERS SAY THIS MORNING
News
ITALIAN lender Unicredit will tap up
investors for 7.5bn (6.4bn) in cash as
it scrambles to pass a new round of
European stress tests.
The banks strategic committee will
this morning unveil the recommenda-
tion to meet requirements by raising
money rather than holding an asset
fire-sale, making it Europes first bank
to formally announce its capital-rais-
ing plan in response to regulators
demand that EU banks find 106bn in
new cash.
Rivals could now feel under pres-
sure to unveil their own plans quickly
to avoid missing out on limited
investor appetite for bank equity.
As part of its strategic review,
Unicredit will also announce that it is
closing its in-house equity cash broker-
age in the City. The move will cost
around 150 jobs, leaving the bank
with just under 1,000 staff in London.
The lender will also reveal plans to
offload 10 per cent of its assets, but
not over the same short timescale as
the capital-raising, which must be
completed by the middle of next year.
Much of the new capital is expected
to be raised in Germany and Austria,
where Unicredit has a large presence.
Its strategy review will see the bank
refocus on growing markets such as
Russia, Poland, Turkey and the Czech
Republic.
City A.M. understands that Unicredit
is being advised in the capital-raising
by a syndicate of banks made up of its
own in-house team, Bank of America
Merrill Lynch and Mediobanca.
Unicredit to
raise 7.5bn
new capital
TAMARA Mellon has stepped down as
chief creative officer of Jimmy Choo,
the shoe brand she co-founded 16
years ago, following its 500m acqui-
sition by European luxury goods
group Labelux in May.
Labelux, which also owns the Swiss
bag designer Bally and fashion label
Derek Lam, announced yesterday that
Mellon will leave Jimmy Choo this
month followed by chief executive
Joshua Schulman, who will step down
early next year.
Jimmy Choo has been sold four
times since Mellon, a former Vogue
accessories editor, founded the label
with the eponymous Malaysian-born
shoemaker in 1996.
Vienna-based Labelux bought the
company from private equity firm
TowerBrook, who in turn acquired
Jimmy Choo in 2007 for 185m, driv-
ing the brands expansion overseas
and introducing other accessories.
Jimmy Choo now encompasses
more than 120 stores in 32 countries
worldwide and is a regular red-carpet
favourite among celebrities. It hit
sales of 150m last year.
Mellon and Schulman will leave fol-
lowing its transition to Labeluxs own-
ership and management control,
the group said.
Labelux was founded in 2007.
Jimmy Choos
founder Mellon
makes her exit
Mellon will leave Jimmy Choo 16 years after founding the footwear brand. Picture: REX
BY JULIET SAMUEL
BANKING
RETAILING
ANALYSIS l UniCredit
8Nov 9Nov 10Nov 11 Nov

0.81
0.83
0.82
0.80
0.79
0.77
0.78
0.76
0.75
0.825
11 Nov
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In association with PoliticsHome.com
In partnership with
To what extent do you think the departure
of Silvio Berlusconi will improve or worsen
Italys financial crisis?
Improve
significantly
Improve
somewhat
Make no
difference
Worsen
somewhat
Worsen
significantly
5
%
51
6
3
8
32
THE majority of our City
A.M./PoliticsHome.com panel think
Greece will leave the euro within
the next year, with an overwhelm-
ing 78 per cent saying that the
indebted countrys exit is likely.
Forty-six per cent said it was very
likely that Greece would no longer
be part of the euro by this time next
year, while almost another third (32
per cent) see the departure as some-
what likely. Just 19 per cent said
that a return to the drachma was
unlikely.
As new Prime Minister Lucas
Papademos begins his first full week
in charge ending weeks of political
uncertainty, he faces the prospect of
having to negotiate a default sce-
nario in his first month in power,
with Greece only sitting on enough
cash to survive until mid-December.
As for Italy, more than half of our
panel (50.8 per cent) said that ex-
Prime Minister Silvio Berlusconis
departure from government would
make no difference to Italys
financial crisis. But 40 per cent were
more optimistic, expecting
Berlusconis exit to improve the
countrys woes.
Our panel was also sceptical
about the potential for Lloyds chief
exec Antnio Horta-Osrio to return
to his role, after he went on leave for
illness. Thirty-nine per cent say
Horta-Osrio is unlikely to return,
versus 30 per cent that expect him
to come back.
BY ELIZABETH FOURNIER
EUROZONE
Greece will leave the euro within

the next year, says our City panel
Very
likely
Somewhat
likely
Neither likely
nor unlikely
Somewhat
unlikely
Very
unlikely
Dont
know
5
%
32
12
3
7
1
46
How likely do you think it is that Greece
will leave the euro within the next year
MARIANO Rajoy, leader of the Peoples
Party which is expected to win next
Sundays Spanish general election, has
called for swift labour market and fis-
cal reforms to be implemented.
He aims to pass a budget stability
law to build on Septembers constitu-
tional ammendment which limits the
public deficit and debt, aimed at
instilling investor confidence.
By the summer, the 2012 budget
should be approved, the restructuring
of the financial sector should be in its
final stages and the labour market
reform should be approved, he said
yesterday.
NOMURA analysts have cast doubt on
the possibility of achieving Eurozone
stability, despite Mario Montis
appointment as Italian Prime
Minister, which is meant to bring
hope to the embattled currency
union.
The banks economists studied the
incentives guiding the actions of the
European Central Bank (ECB) and
member states, and concluded that
member states have strong incentives
not to behave in the manner the ECB
would like.
If the ECB is hawkish on inflation,
it risks damaging weak countries
economies in the short run, warns
analyst Kevin Gaynor.
Yet if it is dovish, individual govern-
ments can benefit from a loose mone-
tary policy and stave off unpopular
reforms, risking long term damage.
Whatever it does, the ECB risks
damaging its reputation and harm-
ing member states.
One solution, Gaynor argues, is to
bring in the IMF to remove fiscal inde-
pendence from countries, allowing
the ECB to run a loose monetary poli-
cy while firm reforms are put in
place.
Alternatively, the ECB could take
more control of each national central
banks foreign currency and gold
reserves to make bad behaviour and
possible withdrawal from the
Eurozone less palatable.
In Italys case, a semi-independent
technocratic government is being cre-
ated. The unelected Monti was made
into a senator last week by President
Georgio Napolitano, before his
appointment as Prime Minister last
night.
Monti, who has a reputation as a
tough Eurozone insider, is in the
process of putting together a small
government of expert ministers,
expected to be announced today.
Napolitano hopes Monti will gain
sufficient support in parliament to
push through the required fiscal and
economic reforms that could save the
country from a deeper crisis.
German chancellor Angela Merkel,
too, backs this approach to driving
through reforms.
I hope that confidence in Italy is
restored, which is crucial for a return
to calm throughout the Eurozone,
she said.
Analysts cast
doubt on the
euros future
GERMAN chancellor Angela Merkel
repeated her call for Eurozone states
to give more powers to Brussels and
push toward fiscal and political
union yesterday.
We want to keep the euro, along
with all the other states that have it.
But that requires a fundamental
change of our policy and more
Europe, she told Germanys ZDF tele-
vision.
Step by step we want more Europe.
That means the EU and the Eurozone
will grow together, otherwise people
wont believe that we really want to
overcome our problems, she added.
We need more
EU, says Merkel
Quick reform in
Spanish sights
BY TIM WALLACE
EUROZONE
EUROZONE
EUROZONE
EU insider Mario Monti plans to push through reforms to save Italy from its financial crisis Picture: REX
News
7
PARTNERS at boutique investment
advisory STJ have seen their share of
profits skyrocket since the firm was
set up in 2008, its most recent
accounts show.
Financial statements for STJ
Advisors filed at Companies House
on Friday show that the profit pool
available to the nine members of
the firms partnership was 4.85m
from March 2010 to March this year,
an average of 539,000 each.
Of that, the partners drew
3.63m, an average of 403,000 per
person.
The boutiques success will dis-
please some bankers at bulge brack-
et banks, whom STJ has accused of
talking down the value of floats to
the detriment of clients looking to
raise capital.
STJs bumper profits during 2010-
2011 compare to a more modest
average profit share of 110,000
between four partners from
September 2008 to March 2010, of
which they drew an average of
63,000 each.
Comparing the same two periods,
revenues rose from some 720,000
to more than 6.68m during 2010-
2011.
STJ specialises in debt and equity
capital-raisings and has been on sev-
eral high-profile deals behind the
scenes, such as the initial public
offering of Spanish savings bank
Bankia, and the pulled float of
Hochtief Concessions and
Telefnicas attempted float of
Atento. Earlier this year, City A.M.
revealed the depth of the animosity
between some independent advis-
ers and larger investment banks,
with each blaming one another for
a seizure in Londons capital mar-
kets, which have still not reopened.
Profits soar at
STJ Advisors
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News
The Queen (right) laid the first
wreath yesterday at Londons
Cenotaph, as part of
Remembrance Day Sunday,
honouring the UKs fallen sol-
diers. Politicans past and pres-
ent, including (left to right in
left-hand picture) Gordon
Brown, Ed Miliband, Tony
Blair, Nick Clegg, John Major
and David Cameron, turned
out for the occasion. War veter-
ans (below) and war widows
marched past the Cenotaph
and observed the two-minute
silence held as Big Ben chimed
11am. Other members of the
Royal Family, including the
Duke of Edinburgh, Prince
William and his wife Kate (see
front) and Prince Charles, also
attended. Pictures: REUTERS
Some bankers will curse this success
Y
OU might think that news of
surging profits at an advisory
firm would be a cause for
cheer in the troubled invest-
ment banking industry.
But STJ Advisors, the boutique
operation run by former Nomura
banker John St John, has a powerful
group of enemies at Londons top
bulge bracket banks. They will be
hoping that the firm is not still
enjoying the same success it report-
ed at the beginning of the year.
Like many independent advisers,
STJ trades off distrust between capi-
tal-raising clients and large invest-
ment banks, staking a claim as an
unconflicted, independent voice.
But STJ has a particularly aggres-
sive style, explicitly accusing larger
banks of distorting issuing prices,
a claim that has understandably
infuriated its rivals.
Unfortunately for them, STJs suc-
cess looks like a sign that firms are
sufficiently nervous about the state
of Londons capital markets that they
want another hand on the tiller.
BOTTOMLINE
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LEGAL & General and private equity
house Bridgepoint are set to battle it
out for control of investor supermar-
ket Cofunds.
The insurer, which is the largest
shareholder with a 25 per cent stake,
has expressed its interest to Cofunds
and Mark Gregory, the executive
director of savings at L&G, recently
approached Cofunds chairman
Charlie Eppinger with a written pro-
posal.
Tim Breedon, the chief executive of
Legal & General, wants to build its
fund platform before he retires from
the insurer at the end of 2012.
Potential bidders for Cofunds have
been told, however, that a full sale
process will not begin until next year,
City A.M. understands. A deal could
value the business at up to 200m.
Bridgepoint is not thought to be
actively preparing a bid but it could
open formal discussions with the
board of Cofunds in the New Year.
The private equity giant is best
known for its investment in high
street brands such as Fat Face and
Pret A Manger but does have experi-
ence in financial services. In 2006 it
sold its interest in wealth manager
Tilney to Deutsche Bank for a report-
ed 250m profit.
A deal for Cofunds could prove
complex, however, given the stakes
held by institutional investors. As well
as Legal & General, technology
provider IFDS owns 24 per cent and
US investor Newhouse Capital owns
18 per cent. British fund managers
Threadneedle and Jupiter own 20 per
cent and 10 per cent respectively and
Prudential owns three per cent of
shares. Bridgepoint and Legal &
General declined to comment.
Cofunds, which has 34bn under
administration, said it did not com-
ment on market speculation.
L&G to battle
buyout group
for Cofunds
BY PETER EDWARDS
M&A
L&G chief executive Tim Breedon retires next year

kateSeuer
Market Update
8aLeSeuer Average Lenolng 8aLes,
04/11/2011 - 10/11/2011
8aLeSeuer ls a peer Lo peer nance company,
maLchlng creolLworLhy 8orrowers wlLh Savers.
All raLes are proLecLeo by 8aLeSeuer rovlslon luno.
8aLes quoLeo are average raLes achleveo beLween
04/11/2011 ano 10/11/2011 ano are neL of all fees.
6.6
3 ?ear lncome
4.4
MonLhly Access
News
ANALYSIS l Cofunds investors
25%
24%
20%
18%
10%
3%
ANALYSIS l Legal and General Group PLC
p
7Nov 8Nov 9Nov 10Nov 11 Nov
108
106
104
102
100
108.00
11 Nov
OVER half of the people in the UK say
the phone hacking scandal has
reduced their level of trust in the
UKs media, according to a survey
commissioned by broadcaster PBS.
The level of mistrust rises further
still when asked about newspapers
specifically, with 58 per cent of peo-
ple saying the scandal had tainted
their opinion of the industry.
Three in four people think media
outlets sometimes lie to their audi-
ences, while over half say content in
the UK media has been dumbed
down in recent years.
Traditional media, especially TV
(64 per cent) and radio (58 per cent),
are still the most trusted media with
the UK public, with websites also scor-
ing highly at 55 per cent.
Newspapers were trusted by just 38
per cent, with magazines languishing
at just 25 per cent. Blogs ranked low-
est, with just nine per cent of people
trusting them. Despite the glut of sto-
ries broken on Twitter in recent
months, social media, which also
included Facebook, scored a trust-rat-
ing of just 15 per cent.
In the US, traditional media again
leads the way on trust, with newspa-
pers viewed as trustworthy by 44 per
cent of Americans, followed by TV
and magazines both on 42 per cent.
Phone hacking casts a shadow
over the UK media landscape
MEDIA
FOUR in 10 wealthy Britons do not

trust their children to protect their
inheritance, according to a report
published this morning.
And the higher an individuals
wealth, the more likely they are to
cut people out of their will.
Barclays Wealth has estimated that
five per cent of those with disposable
wealth between 1m to 2m (exclud-
ing first homes) have disinherited
someone. Yet among people with
over 10m in disposable wealth, a
staggering 13 per cent have booted a
family member or other unlucky
associate off their will.
In the case of wealth that has
been inherited, tensions around enti-
tlement may lead to disputes, said
Catherine Grum of Barclays Wealth.
It is surprising just how many
wealthy respondents report experi-
encing such conflict and the impact
that source of wealth can have on
this, Grum added.
Over a third (37 per cent) of high
net worth individuals in the UK have
encountered family conflict as a
result of inheritance issues, the sur-
vey also revealed.
Yet despite the problems, and a
wider perception that earned wealth
leads to more happiness than inherit-
ed funds, 94 per cent of respondents
remain committed to passing on
wealth, the study showed.
The survey follows an unrelated
campaign, kicked off this month, to
convince rich people to include more
charity donations in their wills.
The Legacy10 campaign notes that
people who leave at least 10 per cent
of their estate to charity will see their
inheritance tax rate slashed from 40
per cent to 36 per cent, starting from
April next year.
Seven per cent of all giving in the
UK comes from the top 100 family
foundations, a report from Pears
Foundation and Cass Business School
will reveal this evening. The report
will encourage comfortably wealthy
people to start more foundations.
Inheritance
issues stoke
family feuds
BY JULIAN HARRIS
PERSONAL FINANCE
News
ECONOMIC WOES GIVE BIRTH TO GOLD BUGS
ECONOMIC troubles are prompting more investors to turn to gold, says BullionVault, which
today reports a 129 per cent growth in volume of its online exchange to 1.57bn, in the 12
months to 31 October. Savers rarely regret the decision to steer clear of governments which
address economic problems by printing money, said CEO Paul Tustain. Picture: GETTY
US-Pacific trade pact falters
BARACK Obama, the US President,
announced plans for an ambitious
cross-Pacific free trade pact from his
home state of Hawaii yesterday, yet
behind closed doors disputes threat-
en to scupper any agreement.
In a private discussion with
Chinese President Hu Jintao over the
weekend, Obama raised the ongoing
battle between the countries over
Chinas weighing down of the yuan.
Obama told Hu the American peo-
ple and US businesses were growing
increasingly impatient and frustrated
with the pace of change in the US-
China economic relationship, senior
White House aide Michael Froman
told reporters.
And relations with Japan were also
strained over the weekend, after
Japanese authorities denied a White
House statement that said the Asian
state would place all its economys
goods and services on the negotiation
table for possible liberalisation.
It is not true that Prime Minister
Noda made such a comment in the
summit meeting. We pointed out to
the US side that the statement in
question is not true and asked for
explanation, a Japanese government
statement said.
The Japanese government faces
strong pressure from lobby groups
that support ongoing protectionism
to defend their industries from for-
eign competition, such as farmers
and doctors.
Yet the Japanese authorities
remain supportive of agreement
between nine members of the Trans-
Pacific Partnership (TPP).
BY JULIAN HARRIS
WORLD ECONOMY
GROWTH in Londons business activi-

ty has plummeted to near-stagnation,
according to the latest purchasing
managers index (PMI) from Lloyds
TSB and Markit.
The index fell from a reading of
54.4 in September to a 14-month low
of 50.4 last month, the survey
showed. Scores of above 50 indicate
some economic expansion.
Behind the overall slowdown was
a sharp moderation in new order
growth, which in turn enabled firms
to complete work outstanding, said
Neil Mahoney of Lloyds TSB.
Meanwhile, firms again displayed a
reluctance to hire, with job creation
only marginal in October.
Input prices continued to rise for
the capitals firms, although input
price inflation remains lower than
that suffered elsewhere in the UK.
Londons business growth
slows to a 14 month low
LONDON ECONOMY
PRIVATE sector firms are still looking

to boost employment over the next
year, yet fresh regulation threatens to
thwart the creation of temporary jobs
and the governments migration cap is
causing difficulties for employers.
Firms are finding the [work permit
migration] cap difficult to navigate,
states a report from the Confederation
of British Industry (CBI) and Harvey
Nash today. Among the complaints,
nearly two thirds (62 per cent) cited
increased complexity, while half report-
ed a lack of clarity over the rules.
Another fresh piece of regulation --
the governments new Agency
Workers Directive is blamed for only
16 per cent of employers expecting to
use more temporary workers over the
next year. One in five say they will use
fewer temps, the CBI research states.
Nonetheless, small and medium-
sized enterprises (SMEs) are leading
the UKs tentative jobs recovery, the
survey says. Nearly half (47 per cent) of
employers expect their headcounts to
be larger this time next year. With 19
per cent predicting job cuts at their
firms, the survey reports a positive 28
per cent balance towards job creation.
Among companies with fewer than
250 employees, a larger positive bal-
ance of 35 per cent expect to recruit
more staff.
Fresh red tape
hindering job
creation in UK
EMPLOYMENT
A FORMER executive at Olympus has

piled more pressure on to the board of
the scandal-hit company by calling for
the return of its ousted president and
chief executive.
Koji Miyata has launched a cam-
paign for the re-instatement of
Michael Woodford (pictured), who was
fired from the group after questioning
a series of controversial payments that
were eventually revealed to be hiding
losses made on acquisitions.
It also emerged over the weekend
that Olympus could face charges from
Japans securities watchdog.
Miyata, a previous head of Olympus
medical systems business who served
as a director for 11 years, has posted
online a 1,300 word message to work-
ers in which he says Olympus endo-
scopic business is not indestructible
and warns that the groups future as
an independent company is at stake.
A lot of you are surely thinking, as I
did initially, that things will work out
somehow. Friends, the Good Ship
Olympus is listing and is in real danger
of sinking.
Partners and customers who have
supported Olympus over the decades
are beginning to abandon our compa-
ny. Clearly, reinstating Michael as pres-
ident and coming completely clean
with the global community is the first
step in revitalising Olympus.
Last week Edinburgh fund manager
Baillie Gifford also called for the re-
instatement of Woodford, who is will-
ing to return to his former job. He
could not be reached yesterday but
said in a message to supporters:
What an extraordinary letter from
Koji Miyata. This is already having
a tremendous impact in Japan.
It came as sources said Japans
Securities Exchange and
Surveillance Commission (SESC)
might recommend that a levy be
imposed on the maker of cam-
eras and endoscopes for making
false financial reports, which
could prevent the company from
being delisted. A de-listing would
enable Olympus to draw a
line under the affair.
The SESC may,
however, urge that
criminal charges be
sought against for-
mer executives and
others involved in
dubious merger
and acquisition
deals used for
decades to hide
large investment losses.
On Saturday GIC, Singapores sover-
eign wealth fund which had a 2.17 per
cent stake as of the end of March,
became the first major investor to
show it had lost confidence in
Olympus when it said it has sold most
of its stake.
Politicians in Japan fear
the fall-out from the
scandal will hit the
countrys other tech-
nology firms and
last week
Southeastern Asset
Management, the
largest foreign
shareholder in
Olympus, said delist-
ing would harm for-
eign investment.
Sources
sai d
the SESC will make a final decision on
its recommendations to the Financial
Services Agency after seeing the
results of a third-party panel investi-
gating the case, as well as corrected
versions of Olympus financial state-
ments. The panels report is due in
early December.
The SESC believes Olympus con-
cealed losses, which could have
exceeded 130 billion yen (1.05bn) at
their peak, were cleared by 2008 and
that there is nothing wrong with the
firms current financial position,
according to Japanese media.
Police, prosecutors and regulators
are believed to be joining forces in a
rare collaborative effort to examine
the cover-up while politicians are con-
sidering legal changes to tighten cor-
porate governance controls.
Olympus ex-director rallies
support for axed Woodford
BY PETER EDWARDS
TECHNOLOGY
News
Calls to attach strings to central banks liquidity
CENTRAL banks risk introducing
moral hazard by providing liquidity
to banks unconditionally, according
to a report out last night from the
Committee on the Global Financial
System (CGFS), a part of the Bank for
International Settlements (BIS).
The European Central Bank (ECB),
now led by Mario Draghi (pictured
right) has been a major provider of
liquidity to troubled banks since the
start of the financial crisis.
If such banks believe they will
always be provided with foreign cur-
rency liquidity by central banks in
times of crisis, this could cause an
unwelcome delay in needed domes-
tic adjustments and in reducing
existing imbalances, the report
said.
This expectation of help could
fuel risk-taking and tempt banks
and other financial institutions to
run larger currency and maturity
mismatches.
The report cites the International
Monetary Funds (IMF) aid model as
an example of one which attach-
es strings to any assistance,
partly eliminating the risk of
moral hazard arising.
IMF conditionality has been
instrumental in containing
moral hazard, the CGFS
report argued.
Aid to governments from
the IMF tends to be condi-
tional on various structur-
al changes being
implemented, to avoid
countries taking aid dur-
ing a crisis and doing
nothing to prevent another
such crisis from occurring.
For example, the Greek gov-
ernment must cut back on its
public spending and regain
competitiveness with wage
and pension freezes if it
wants to receive
bailout loans from
the IMF.
However, overall
the report claimed
central banks per-
formed well in
addressing recent
liquidity crises.
Thanks to the co-operation mecha-
nism of the Basel process, the report
said central banks remain well
placed to address future surges and
shortages in global liquidity.
Meanwhile, Bundesbank presi-
dent Jens Weidmann yesterday
argued against ECB intervention in
bond markets, claiming it should
not be a lender of last resort for sov-
ereigns.
This would violate treaty agree-
ments and undermine Eurozone sta-
bility, he told the FT.
BY TIM WALLACE
REGULATION
TIME LINE | OLYMPUS ROW

14 October
Olympus fires British Michael
Woodford, six months after he was
made president and just two weeks
after becoming chief executive, after
he persistently asked why the compa-
ny had spent around $1.3bn (807.8m)
on obscure fees and acquisitions. The
company said it was due to manage-
ment issues
20 October
Woodford requests police protection
from Scotland Yard.
26 October
Olympus chairman Tsuyoshi Kikukawa
resigns after criticising Woodford.
9 November
Baillie Gifford, the Edinburgh-based
fund manager, calls for the reinstate-
ment of Woodford. Investment manag-
er Iain Campbell says Olympus current
management is now discredited.
10 November
Tokyos stock exchange warns Olympus
it will be de-listed after 62 years as a
publicly traded company if it fails to
report earnings by 14 December.
12 November
GIC, Singapores sovereign wealth fund,
says it has sold most of its holdings in
Olympus over concern about payments
made by the group.
13 November
Sources say Japanese securities
watchdog the SESC may recommend
the imposition of a levy on Olympus for
false financial reports.
ANALYSIS l Olympus Corp
JPY
1,100
1,000
900
800
700
600
500
460.00
11 Nov
THE traditional areas where business
sectors have operated for decades are
changing as companies hunt for
affordable and convenient office
space, according to new research pub-
lished today.
While the City has always been the
hub for banks and insurance it is also
becoming a magnet for IT firms and
the changing makeup of the area is
reflected across other zones in the
capital.
The new map of business London
shows a variety of such changes as
firms migrate to new areas.
The map, drawn up by DeVono
Property, reveals a new business
belt sweeping around Kings Cross
and Paddington, where hundreds of
offices have been built in recent
years.
The areas have benefited from
strong transport links while space is
not as squeezed as it is in areas like
the Square Mile.
Recent tenants to move to this area
include Gazprom and Ricoh, who are
based in the relatively new Euston
Place complex.
Meanwhile in the financial sector
the research highlights the number
of hedge funds which now operate
from Mayfair, while property compa-
nies also prefer to ply their trade
from the glamorous location.
DeVono co-director Adam Landau
said that London Bridge was shooting
up the rankings as a desirable loca-
tion for financial services.
It is an important extension of the
City south of the river with leading
legal practitioners, consultants and
accountancy firms such as PwC and
Ernst & Young having their headquar-
ters there. It is seeing a massive
upgrade with developments such as
the Shard, which will be the tallest
building in Western Europe.
The map showed that more fashion
companies were moving into
Clerkenwell, while new media com-
panies were heading towards Victoria
away from their traditional heartland
in Shoreditch. According to the map
fewer government workers are based
in Victoria than before.
Meanwhile Holborn is still an area
that attracts lawyers and account-
ants, although more recruitment
firms are heading there.
City business map re-drawn
THE US IPO market could see its
busiest week in more than a year,
with nine companies aiming to begin
fundraising in the next five days.
The prospective deals include a
$114m (71m) capital raising on the
Nasdaq from consumer review web-
site Angies List, and a $578m offering
from Delphi Automotive on the New
York Stock Exchange.
But the companies are likely to
have to show price flexibility in the
face of recent market volatility, such
as the massive stock dive last
Wednesday sparked by Italys surging
bond yields.
Other businesses, all seeking less
than $250m each, include bedding
retailer Mattress Firm Holding, invest-
ment manager Manning & Napier
and biopharmaceutical company
Clovis Oncology.
InvenSense, which makes motion-
processing technology for consumer
electronics, is getting off the blocks
after delaying a planned deal in early
August. Meanwhile Hollywood spe-
cial-effects firm Digital Domain
Media Group is returning to the mar-
ket after putting its deal on hold
since April 2008.
The last time there was such a big
line up of initial public offerings was
in December 2010.
Bumper week
for US IPOs as
nine start deals
Accountants
Accountants
BY JOHN DUNNE
LONDON BUSINESS
MARKETS
News

Wednesday 16th November at 6.30pm

www.knowledgetoaction.co.uk/cityam
Learn the secrets of a
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HMV HAS launched its first store dedi-
cated to technology in Londons
Square Mile in a bid to reverse its
declining CD and DVD sales in the run
up to the crucial Christmas trading
period.
The so-called techshop, located in
Land Securities One New Change mall
near St Pauls, comes after the trou-
bled retailers recent expansion into
consumer technology as demand for
CDs and DVDs wanes.
HMV, which has issued four profit
warnings this year, is pinning its
hopes on customers seeking technolo-
gy gadgets such as iPads, speaker
docks as well as headphones, which
have been enjoying bumper sales.
Around 10m gadgets are expected
to be sold in the UK by the end of
2011 equivalent to a market value of
more than 150m, HMV said.
The retailer, which has closed 29
stores and sold its Canadian business
and its Waterstones bookshops,
reported a 15.1 per cent slump in like-
for-like sales for the first quarter to 3
September.
HMV signed a short-term lease with
landlord Land Securities last week for
the site in One New Change as it trials
the store and plans to open a second
site before Christmas.
HMV turns the music off
to open first tech store
HMV has been shifting its focus from CDs to consumer technology. Source: Hugh Thompson
BY KASMIRA JEFFORD
RETAIL
News
NEWS | IN BRIEF
John Lewis sees sales dip
Department store group and traditional
retail bellwether John Lewis said its
sales had dipped slightly last week
compared with the same week a year
ago, as mild autumnal weather and a
difficult economic backdrop deterred
shoppers. The employee-owned busi-
ness said yesterday that sales in the
week to 12 November were 76m, up
six per cent from last week but down
0.8 per cent from a year ago, on strong
comparatives. With very strong fig-
ures from last year against us, milder
weather than is seasonal and the tur-
bulent economic climate, our results
show that our customers are beginning
to think seriously about Christmas,
said retail director Andrew Murphy. In
the week to 5 November John Lewis
reported a rise of 4.4 per cent in
department store sales.
A SERIES of private equity houses are
lining up to bid for the National
Fostering Agency (NFA) from
Sovereign Capital.
The Priory Group, which is backed
by Advent private equity and runs the
renowned Roehampton rehabilita-
tion clinic, is believed to have made
an approach already. Teachers
Private Capital, the private invest-
ment arm of Ontario Teachers
Pension Plan, is also believed to have
made a bid while private equity
group Blackstone is thought to be
mulling over an approach.
The Priory declined to comment.
Advent, Sovereign and the NFA could
not be reached.
Private equity houses circle NFA
PRIVATE EQUITY
BUSINESS Secretary Vince Cable has

said he has sympathy with the pro-
testers at St Pauls Cathedral but ques-
tioned the aims of the camp.
Yesterday he told the BBC he had
sympathy with the emotions that lie
behind Occupy LSX but stopped
short of giving an endorsement.
Some of their recommendations
arent terribly helpful, but thats not
the point. I think it does reflect a feel-
ing that a small number of people
have done extraordinarily well in the
crisis, often undeservedly, and large
numbers of other people whove
played no part in causing the crisis
have been hurt by it.
His comments are a contrast to
those of David Cameron, who has crit-
icised the camp and last week
mocked the protesters as comatose.
Cable spoke out hours before much
of London, including the protesters,
observed two minutes silence as part
of Remembrance Sunday.
The previous day about 6,000 peo-
ple joined the Lord Mayors Show pro-
cession. Alderman David Wootton,
the 684th Lord Mayor of London,
received the traditional St Pauls
blessing in a different area of the
grounds because of the presence of
Occupy LSX.
MORE: THE CAPITALIST, P20
Cable sympathises with the
Citys Occupy LSX protesters
POLITICS
News
Torch relay break-down
Samsung
Other
BA
Coca-Cola
BT
Visa
Lloyds
%
4%
22%
20%
14%
4%
17%
17%
Brought to you by
IN ASSOCIATION with
Repskan.com, the media monitor-
ing and analytics platform, City
A.M. is measuring the relative
Olympic media buzz around the
partners for the London 2012
Olympic and Paralympic Games,
week by week. The leaderboard,
right, reflects their ranking over
the past week, in this case from
Wednesday 2 November to
Wednesday 9 November.
Due to the announcement of the
route of the 70-day torch relay,
mentions about the Olympics
spiked to over 10,000 mentions
on 8 November.
The main torch relay sponsors
dominated the discussion but
some of the other sponsors
picked up share of voice through
discussion stimulated by the
torch relay.
With a story gaining strong local
interest there was a significant
number of mentions in the
regional newspapers and on
Twitter.
REPSKAN LONDON 2012 OLYMPICS
BUZZ ANALYSIS
Brand Position change
Samsung 1
Lloyds 5
Coca-Cola 1
BA 14
BP 11
Adidas -1
Mcdonalds 5
Visa -7
Cadbury 3
Acer 6
Olympic Media Buzz
LONDON 2012 PARTNERS
WWW.SGMARKETMASTER.CO.UK
7
th
NOVEMBER 5
th
DECEMBER 2011
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News
NEWS | IN BRIEF
Rabobank decision awaited
Sarasin hopes Dutch Rabobank will make
a decision this month on its controlling
stake that allows the Swiss private bank
to remain independent, its management
told staff in an internal memo. Sarasin
confirmed a SonntagsZeitung newspaper
report that chairman Christoph Ammann
and chief executive Joachim Straehle
were in close contact with Rabobank.
Batteries for electric cars probed
Regulators are investigating the safety of
batteries used to power electric vehicles
after a General Motors Volt caught fire
following a crash test. The National
Highway Traffic Safety Administration
said it has asked automakers for their
recommendations for minimising fire risk,
though it does not believe the Volt or
other such cars were at more risk of fire.
Blame selfishness, not capitalism, for our woes
I
LOVE a protest. So long as it
involves a point worthy of consid-
eration, and preferably a brazier,
Im there.
Ive spent quite a while wander-
ing around the OccupyLSX site read-
ing the bumf and trying to look
inconspicuous. No mean feat when
youre 62 and wearing full TV studio
make-up, but still.
I think most people can empathise
with the calls for genuinely independ-
ent regulators and solidarity with the
oppressed.
But the issues always come back to
capitalists versus anti-capitalists and I
simply dont buy the analysis.
Protesters are lumped together as
anti-capitalists, which over-simplifies
their complaints. The most radical
free-market capitalists agree that
bank bailouts are nonsensical.
And capitalists are cast as the bad-
dies, which is simply lazy.
Capitalism itself doesnt make peo-
ple vile. Having money doesnt make
people obnoxious. People on average
incomes and poor people are quite
capable of being obnoxious too.
But capitalism does reward some
people with lots of cash and gives
them a platform from which to
broadcast their unpleasantness.
In an ideal world the wealthiest
would intersperse extravagant acts of
consumption with extravagant acts of
charitable selflessness. But the fact
that this doesnt necessarily happen
is no surprise. You cant force selfless
behaviour on people under any eco-
nomic system.
Ultimately people need gainful
employment, whatever the ideology.
The best people to employ others are
those who run business and are
therefore in a position to pay and that
gets us back, one way or another, to
private ownership of the means of
production i.e. capitalism.
Theres nothing intrinsic to capital-
ism that requires greed, cold-hearted-
ness or blind materialism.
So, if were not to blame capitalism
for the current wave of dissatisfac-
tion, who are we to blame?
Selfish prats. They can be found
across the political spectrum and in
all socio-economic groups. They make
poor decisions and screw things up
for everyone else. Try removing capi-
talist from any slogan and replace it
with selfish prat and youll find it
makes much more sense.
I dont have the answers to the
worlds economic woes, but Im pret-
ty sure of this: Any political or busi-
ness leader or any average Joe would
be well served by looking at any deci-
sion they have made and asking
themselves Am I being a selfish
prat?
Beccy Meehan is an anchor at CNBC.
Follow her on Twitter @BeccyMeehan
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SIR STELIOS Haji-Ioannou has upped
the ante in his long-running battle
with the board of EasyJet, the airline
he founded, issuing a string of
demands and claiming the firm had
tried to turn his brother against him.
The colourful businessman, who
still owns 38 per cent of EasyJet,
demanded a doubling of the firms
dividend, changes to the way it pub-
lishes information about its earnings
and more voting rights for sharehold-
ers over commercial issues.
He said he specifically wants infor-
mation about the profitability of indi-
vidual routes and a shareholder vote
orders of new aircraft.
Stelios also said Sir Mike Rake had
tried to pit his brother and fellow
shareholder Polys Haji Ioannou
against him in order to lessen his
influence over the company.
In September Stelios told the air-
line he is planning to launch a rival
airline called Fastjet, prompting
EasyJet to vow to take necessary
action if the new venture infringes
on the rights of the airline and its
investors.
The shock move reignited a row
that appeared to have cooled after
EasyJets management promised to
pay out a special dividend of 190m
to shareholders.
EMIRATES airline placed a block-
buster order for 50 Boeing 777 jetlin-
ers at the Dubai Air Show yesterday,
underscoring the confidence brim-
ming among fast-growing Gulf air-
lines despite growing fears of stalling
global growth.
The Dubai government-owned car-
rier, expanding its role as the worlds
largest operator of Boeings most prof-
itable plane, said the deal was worth
$18bn (11.2bn), the largest commer-
cial order by value in the US plane-
makers history.
Emirates chairman Sheikh Ahmed
bin Saeed al Maktoum said: This
order represents a milestone -- it is the
single largest dollar value (order) in
the Boeing history.
The 777 has served Emirates very
well in terms of seat costs ... especially
when we see the fuel price is quite
high.
Fuel costs took a big toll on the air-
lines first half profits, sending them
down 76 per cent.
Emirates said it had adequate
financing in place for 2012, and
planned no new bond issues. Sheikh
Ahmed said the airline, which
launched a heavily oversubscribed
$1bn bond in June, would consider a
bond if needed and if the timing was
right, adding we dont have a push.
Including options to buy 20 more
of the twin-aisle aircraft and other
agreements, the total deal is worth
$26bn, Emirates and Boeing said.
The airline planned to eye a mix of
funding options for the order, includ-
ing Islamic finance, he added.
Delivery of the aircraft is slated to
begin in 2015.
James Albaugh, chief of Boeings
commercial division, said the order
would sustain thousands of US jobs.
Boeing delivered 127 commercial
aircraft in the third quarter, includ-
ing 100 of its best-selling 737 narrow-
bodies and 21 widebody 777s. The
planemaker, which gets paid for its
planes at delivery, set its commercial
airplane delivery guidance for 2011 at
about 480, down from previous guid-
ance of 485 to 495.
Qatar Airways is expected to place a
$6.5bn order for 50 fuel-saving
A320neo jets and five A380s from
Airbus, and Kuwait lessor Alafco
plans to boost a provisional order for
30 Airbus A320neos.
Emirates to
spend $18bn
on new jets
NEARLY two thirds of British business-
es suffered disruption to their supply
chain because of last winters bad
weather, a high-level panel led by
insurance firm Zurich has found.
The panel, which included officials
from the governments department
for Business Innovation and Skills and
the Association of British Insurers, was
brought together to create a green
paper on how businesses can better
prepare for extreme weather events,
such as floods and snow, which affect-
ed 64 per cent of UK firms last year..
The meeting, held in Westminster
last week, came after a survey released
by the Business Continuity Institute
and Zurich said 51 per cent of 550
firms across 60 countries named
harsh weather as the main cause dis-
ruption to their business in 2011.
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Extreme weather
costs UK business
Stelios makes series of demands
to EasyJet board as fight rolls on
BY STEVE DINNEEN
TRANSPORT
AVIATION
Emirates, led by
chief executive Tim
Clark, has spent
$18bn on new
Boeing jets
Picture:
Laura Lean / CITY
A.M.
BY KASMIRA JEFFORD
ECONOMICS
News
The Capitalist
EDITED BY
HARRIET DENNYS
Got A Story? Email
thecapitalist@cityam.com
Follow The Capitalist
on Twitter: @dennysharriet
ONCE absorbed in the oriental-
inspired boudoir, there is no choice
but to succumb to the infectious con-
cept that is Kumo, claims the PR frip-
perie for the new Knightsbridge sushi
bar. For once, the froth merchants
may have a point, judging by the
antics of six brokers who got sucked
in by the low-lit Japanese den until
one in the morning on a recent
Sunday night out. So what made
them stay so long and more impor-
tantly burn through north of 2k in
five hours? Warm beef salad, scal-
lops with pak choi, fried squid and
seabass fillet all played their part,
but this column suspects the four
bottles of pinot grigio, one of Dom
Prignon and another of the
extremely sought-after vintage
Dom Prignon ros may have exert-
ed the greatest pull.
BILL OF THE WEEK
The Capitalist hears, for the wedding of
one banker dealing in European debt
markets to his paediatrician wife,
who started their party with a trip on
the London Eye to get the best view of
the money-to-burn spectacle.
More bangs, as one wedding guest
noted, for his buck. FORUM, P. 27
DISASTER RESPONSE
DOES Andrew Gowers regret being
quite so dogmatic on the subject of
why Britain should join the euro in
his former incarnation as editor of
the Financial Times?
While Gowers was at the helm
between 2001 and 2005, the pink
paper was famously firmly in the sin-
gle currency camp but now the euro
has wreaked financial devastation
and social collapse, the avuncular
sage has issued a mea culpa.
There were strong arguments
that the continent of Europe need-
ed greater stability in its currency
arrangements, Gowers told The
Capitalist. But there were birth
defects when [the euro model] was
designed and the implementation
made it worse.
So theoretically the model was
sound, but in practice it was flawed
a PR masterstroke of a U-turn from
the man who went on to stage-man-
age the comms for Lehman too big
to fail Brothers and BPs Gulf of
Mexico disaster.
SPEAKING OUT
WHEN you are a woman working in
the City, you have got to speak up in
fact, it is life or death, says Christine
Brown-Quinn, co-founder of the
Women in Business Superconference.
No shrinking violet herself the ex-
banker once told her manager at
Swiss Bank exactly why he needed her
on a project Brown-Quinn is now
telling fellow aspiring professional
women how to compete without
becoming a man.
It is difficult, but people respect
you if you assert yourself they know
you are not a wallflower, speakers at
her conference told delegates from
firms including Standard Chartered,
KPMG and Reed Smith to the sound of
glass ceilings smashing.
BANKER GETS MORE BANGS FOR HIS
BUCKS AT MAYORS SHOW WEDDING
NO NEWS is good news, says the City
of London Corporation, which yes-
terday breathed a sigh of relief after
the St Pauls protesters decided to
respect the fact the Lord Mayors
Show is a community event.
There was no disruption, not even
shouting, said a City of London
spokesperson on Saturdays walking,
marching pageant of the nations
life, where the 684th Lord Mayor of
London David Wootton was inaugu-
rated with an 123-float procession.
We are not against the tradition
of the ceremony; we are against the
undemocratic way the Lord Mayor
is elected, said a spokesperson for
the St Pauls brigade. So we didnt
interrupt the ceremony as we did-
nt want to spoil the mood.
The non-intervention policy left
the streets from Mansion House to
the Royal Courts of Justice clear for
the three-mile pageant, which
involved 6,200 people and over 40
charities, including representatives
from the new Mayoral charity appeal
Fit for the Future, which will primari-
ly benefit the trauma unit at the
Royal London Hospital.
The parade culminated in the Lord
Mayors fireworks over the river,
which made the perfect backdrop,
David Wootton, the 684th Lord Mayor of London, arrives at the Royal Courts of Justice
At my bank everyone
can get a bonus.
At the end of 2010, The Co-operative Group shared over 70.5m in prots
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payment. To qualify for a share of the profits payment members must have earned a minimum of 2 worth of membership points, within the qualifying period. Membership
terms and conditions apply. Products not eligible to earn points are affinity and partnership products, offshore, fixed rate and fixed term savings accounts and bonds. Lines
are open from 8am until 9pm, Monday to Friday and 9am until 6pm, Saturday and Sunday. Calls may be monitored or recorded for security and training purposes. For BT
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P.O. Box 101, 1 Balloon Street, Manchester M60 4EP. Registered in England and Wales No. 990937. Britannia is a trading name used by The Co-operative Bank p.l.c.
UBS is widely expected to name inter-
im head Sergio Ermotti as its perma-
nent chief executive when it updates
investors this week.
It is also set to present plans to cut
the size of its investment bank, where
alleged rogue trader Kweku Adoboli
worked, in order to focus on less risky
wealth and asset management.
The bank has brought forward the
appointment of Ermotti because it
wants to end the power vacuum cre-
ated by the resignation of Oswald
Gruebel, who left in the aftermath of
the $2.3bn (1.4bn) trading scandal in
September.
This would allow the new boss to
outline his strategy believed to
include a bolstering of its cash equi-
ties, foreign exchange and invest-
ment banking advisory work at the
investor day on Thursday.
Ermotti could also announce an
extra 1,500 job cuts, Swiss newspaper
Tages-Anzeiger claimed last week.
The suave Swiss executive has been
groomed as a possible successor to
Gruebel since he joined UBS as head
of Europe, Middle East and Africa in
April from UniCredit.
He is seen as the continuity candi-
date who could shore up the confi-
dence of regulators in Berne, who
want to see UBS and rival Credit
Suisse cut their balance sheets again.
Juerg Zeltner, head of UBS private
bank, and Ulrich Koerner, the cost-
cutting chief operating officer, were
said to be angling for the job while
outside candidates had included
Deutsche Bank risk chief Hugo
Baenziger, who insisted he was com-
mitted to his current job, and Bill
Winters, the former chief executive of
JP Morgan. The American has since
been touted as a replacement for
Antonio Horta- Osrio if he is unable
to return to work at Lloyds.
UBS declined to comment.
Cuts loom as
Ermotti set to
win UBS post
BY PETER EDWARDS
BANKING
Sergio Ermotti may cut jobs in his first week in the UBS top job Picture: REUTERS
News
22
More Evolution jobs to go
after Investecs takeover
EVOLUTION is preparing to axe more
staff once its takeover by South
African investment group Investec is
completed next month.
The broker-turned-wealth manager
has made around 60 staff redundant
in the last 10 days and City A.M. under-
stands more job cuts are planned,
although no decision on numbers has
been made so far.
The 210m deal a reduction on
the 233m value announced in
September is due to be completed
on 13 December, clearing the way for
Investec to restructure the business.
Evolutions chief executive Alex
Snow will take a seat on Investecs
board and become executive chair-
man of its UK investment bank.
Only 56 per cent of Evolutions
shareholders voted either for or
against the offer at the general meet-
ing called to approve the deal.
Evolution itself agreed to take over
BNP Paribas Private Investment
Management in August.
Last night a spokesman for
Evolution declined to comment.
BANKING
HMRCs use of powers to seize

business assets grows four-fold
News
23
Markets hoping for
economic decisions
W
EDNESDAYS sharp sell-off
across major global stock
indices showed just how skit-
tish markets are currently.
The slump in Italian bond prices did the
damage as yields flew higher.
The situation calmed down towards
the end of the week as the political sit-
uation in Greece and Italy became
clearer. Former ECB vice president
Lucas Papademos was sworn in as the
new Greek prime minister on Friday,
while ex-European Commissioner
Mario Monti is expected to replace
Silvio Berlusconi.
Investors feel that both appoint-
ments increase the chances that diffi-
cult economic decisions will finally be
made. However, agreeing to take
unpalatable measures is quite different
from implementing them. Greek and
Italian policymakers have to persuade
their respective citizens that further
economic hardship now will ultimate-
ly lead to better times in the future.
Meanwhile, there is a feeling that
Italian 10-year bond yields would still
be well above 7 per cent without con-
siderable intervention from the ECB in
the secondary market.
The FTSE 100 index is called to open
down 5 points at 5540. The German
DAX is expected to open down 7 points
at 6050 and the French CAC 40 is fore-
cast to open down 4 points at 3145.
Tomorrow sees the release of UK
inflation numbers. The Bank of
England (BoE) will be hoping for signs
of easing pricing pressures with the CPI
ticking back down towards 5 per cent.
A reading above 5.2 per cent is likely to
attract criticism of the Bank following
last months controversial decision by
the MPC to increase quantitative easing
by 75bn. We will also see US PPI and
Retail Sales tomorrow, and the BoE
releases its quarterly inflation report
on Wednesday. US Housing Starts,
Building Permits and the Philly Fed
Manufacturing Index are all released
on Thursday.
The US third quarter earnings sea-
son is rapidly winding down now.
According to Thomson Reuters, of the
90 per cent of S&P constituents who
have now reported, 70 per cent have
beaten estimates. This is helping to per-
suade many investors that the US econ-
omy will emerge relatively unscathed
from the ongoing debt crisis in Europe.
This view may prove to be overly opti-
mistic.
Martin Slaney is director of global product
management at GFT
MARTIN ON
THE MARKETS
MARTIN SLANEY
5Sep 15Aug 23Sep 13Oct 2Nov
5,800
5,000
5,400
5,200
5,600
ANALYSIS l FTSE
5545.38
11 Nov
6April 2008- 5April 2009 6April 2009- 5April 2010 6April 2010- 5April 2011
8000
7000
6000
5000
4000
3000
2000
1000
0
ANALYSIS l HMRC seizure of business assets quadruples in just two years
1675
4899
7004
HMRC has massively increased its use
of powers, allowing it to seize the
assets of late-paying businesses in an
urgent effort to increase its tax take, a
new report has revealed.
Data obtained by law firm
McGrigors shows that the number of
times HMRC has used its powers of dis-
traint to seize assets of late-payers has
quadrupled in the last two years, rising
from 1,675 cases in 2009 to 7,004 in the
year to April 2011.
The law and tax specialist firm
points out that in some cases, HMRCs
use of distraint may be over-zealous
in seizing the very assets that a busi-
ness needs to trade through its diffi-
culties, and effectively forcing some
companies into insolvency.
McGrigors partner Stuart McNeill,
explains: HMRC is under huge pres-
sure to collect unpaid tax, but at the
same time they are facing cuts in their
staffing levels...It is almost inevitable
that this is resulting in a more aggres-
sive approach and short cuts.
Without making a proper commer-
cial assessment of the firms medium
term viability, HMRC risk sacrificing
full payment in a few months time for
far less cash up front, said McNeill.
A spokesman for HMRC responded:
Only a very small number of business-
es who have long term outstanding tax
debts are collected in this way.
We support businesses in genuine
difficulty through allowing time to
pay whilst taking firm but proportion-
ate action against those who dont
pay.
ECONOMY
News
BEST OF THE BROKERS
To appear in Best of the Brokers email your research to notes@cityam.com
ANALYSIS l Rexel
13.4
13.2
13.0
12.8
12.6
12.4
12.85
11 Nov
REXEL
Nomura rates Rexel, the French-based electri-
cal supplies company as buy against a sec-
tor rating of neutral, with a target price of
18.00 (15.00). The bank views Rexel as a
high quality company with the potential to
grow organically through specific growth
drivers in the market and notes its solid cash
flow. However, the broker has cut its full year
estimates for 2012 by six per cent due to a
reduction in growth prospects for Europe.
ANALYSIS l Enel SpA
3.40
3.35
3.30
3.25
3.20
3.15
3.28
11 Nov
ENEL
Citigroup rates Enel as sell after the Italy-
based energy company reported earnings
before interest, tax, depreciation and amorti-
sation of 13.284m in the nine months to
September 30, above its forecast of 13.1bn.
The broker says stronger-than-expected
Slovakia and Balkans activity and growth of
the Italian distribution division helped offset
the poor performance of its Italian genera-
tion business.
ANALYSIS l Dairy Crest Group PLC
345
340
335
330
325
p
337.60
11 Nov
DAIRY CREST
UBS rates Dairy Crest as neutral and main-
tains its price target of 336p despite the
group posting pre-tax profits of 43.7m,
beating the banks expectations of 41m.
UBS says that whilst management has done
a good job maintaining earnings, its large liq-
uid milk operations struggle to grow top-line,
and with competition intense Dairy Crest
generates relatively poor returns. The broker
sees better value elsewhere.
Cenkos
The stockbroker has appointed equities
analyst Sandy Chen to its institutional
equities research department. Chens for-
mer roles include head of emerging
European banks research at Credit
Suisse and UK banks analyst at Collins
Stewart and Panmure Gordon. He also
founded retail banking start-up Walton
& Co, where he remains a director.
PwC
The Big Four firm has appointed
Richard Laikin as head of its UK water
group. Laikin started his career at PwC
and re-joined the company as a direc-
tor in the power and utilities consulting
team at the end of 2010.
RBS Insurance
Neil Manser has joined RBS Insurance as
head of investor relations. Manser most
recently worked at the general insurer
Brit Insurance, where he led investor and
ratings agency relations.
Iveagh
The Guinness family office and asset
management boutique has appointed
Richard Ford as chief executive. Ford
was most recently CEO of WH Ireland
and has previously worked at Spencer
House Capital Management, ORN
Capital and Fidelity Investments.
Cazenove Capital
Carter Holloran has joined the fund man-
ager as a high yield credit analyst,
reporting to Cazenove Capitals head of
credit Peter Harvey. He joins from
European Credit Management, where he
was an analyst specialising in European
industrial credit.
Aureos Capital
The private equity fund manager special-
ising in emerging markets has appointed
Marlon Sahetapy as a principal responsi-
ble for Europe, Middle East and Africa to
expand its private sector investor base.
He moves from Hermes Focus Asset
Management, where he was director,
marketing and investor relations.
CITY MOVES | WHOS SWITCHING JOBS Edited by Harriet Dennys
+44 (0)20 7092 0053
morganmckinley.com
To appear in CITYMOVES please email your career
updates and pictures to citymoves@cityam.com SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
in association with
Crest Nicholson
The house builder has appointed Trevor Selwyn
as managing director of a newly formed London
division. The new division will have an annual
turnover of 100m, developing mid-range sites
in and around the capital. Selwyn was formerly
at Countryside Properties, and spent his last
seven years there as land director for subsidiary
Copthorn Homes. He left in 2009 to establish
property developer Team Homes, a specialist in
mixed-used developments in north, south and
east London.
WALL STREET WEEK AHEAD
W
ALL Street is stuck in a high-
ly volatile range as investors
hoping for a rally into the
end of the year are brow-
beaten by Europes unfolding crisis.
For months, investors have been
enthusing about valuations, earnings
and, more recently, signs of an
improving economy. Those may be
good reasons why stocks should rally,
but even the most ardent are starting
to sound a bit glum.
The political intrigue in southern
Europe has flummoxed investors
Stateside. Papademos has replaced
Papandreou. Berlusconi is, well,
Berlusconi. The headlines and the
subsequent volatility seem relentless.
It literally just changes consistent-
ly each and every night, said Jeremy
Zirin, chief US equity strategist at UBS
Wealth Management in New York.
Earlier last week, there were wor-
ries about a potential Italian default
and now weve seen government and
regime change in two of the periph-
ery nations.
Events in Europe over the weekend
could end up shaping the start of the
trading week in US markets.
Italys Senate approved a new budg-
et law, clearing the way for approval
of the package in the lower house on
Saturday and the formation of an
emergency government to replace
that of Prime Minister Silvio
Berlusconi.
In Athens, former European
Central Bank policy-maker Lucas
Papademos was sworn in as Greek
prime minister, replacing predecessor
George Papandreou after days of
political wrangling. He is tasked with
meeting the terms of a bailout plan.
For the markets to continue to
rally, we would need to see market
confidence that Italian, Spanish and
French bonds are money good, Zirin
said.
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S
POTIFY is taking over the world, wrapping
its tentacles around the music industry
like the alien flora from HG Wellss War of
the Worlds. Over the summer it finally
announced its long (very, very long) awaited
expansion into the US. Then came a transforma-
tive deal with Facebook, allowing users to log in
and share music over the social network. In less
than two months it has reportedly attracted
more than 4m new users to Spotify, a massive
boost to the 10m it already had. More than 1.5bn
songs have been shared, with its average daily
users jumping to 2.5m.
You can download it onto your iPhone,
Android or Windows Phone; and to use the serv-
ice on a mobile requires signing up to its premi-
um 9.99 a month service, which is where
Spotify makes its real money. It has also penned
a deal in the UK with Virgin Media to fea-
ture Spotify on its fast-growing TiVo serv-
ice. It is expected to post its first profit
this year compared to a 26.5m loss last
year and a recent round of funding val-
ued it at $1bn. Its little wonder founder
Daniel Ek won City A.M.s entrepreneur
of the year award in September.
It hasnt always been plain sailing:
when Spotify struggled to sign up the
big four labels in the US, its American
dream looked over before it began. The
labels were right to be worried: Spotify
is a low-margin company and its royal-
ty payments are low too.
But nobody has had much success
against illegal downloaders attempts
to strong-arm fans through legal
threats have been laughably ineffec-
tive; at least with Spotify they can make
something back. To highlight just how
much the landscape has changed,
Vivendi made as much money selling
video games through Activision last
year as it did selling music through
Universal. The industry had to adapt
and Spotify is one way of doing it. So
everyone is a winner then? Not quite.
Ten years ago, Courtney Love did some sums
on the back of a napkin to illustrate how badly
paid her band was. Working on the assumption
her latest album would make $1m (and bear in
mind this was the year 2000), she calculated the
flow of cash. First, $0.5m to recoup costs of
recording, editing, distributing and marketing.
A cool $100,000 to pay the managers 20 per cent.
Legal and administrative fees were another
$50,000, leaving her band with $350,000. Take
away taxes of $170,000 and split it in four and
youre left with a paltry $45,000 for each band
member. And being Courtney Love costs signifi-
cantly more than $45,000.
Based on this, Courtney would have a heart
attack if she took a look at Spotifys royalties. I
did some calculations on a napkin of my own,
based on some figures leaked by indie band
Uniform Motion. The band which describes
itself as an illustrated indie-folk band combin-
ing music with visual arts but dont let that put
you off, they are actually pretty good says it
makes just $0.0041 every time one of its songs is
played on Spotify, equating to $0.04 if you stick
around for the full album. In contrast, they say
they make almost $6 for every physical album
sold. If these figures are right (and I couldnt get
through to Spotify to check), a band would need
to get 250m song listens to earn Courtney Loves
elusive $1m, equating to about 25m album plays.
To put this in perspective, U2s The Joshua Tree
sold around 2m copies in the UK, discounting re-
releases. So record 10 of those and youre a
Spotify millionaire. But its not easy U2 certain-
ly didnt manage to record another nine decent
albums.
Now admittedly not many people only listen
to a record once after buying the CD (although I
imagine this is the case for the last nine U2 offer-
ings) and no musician hopes to survive from
Spotify alone. It can also be a formidable market-
ing tool. Fans use the service to discover musi-
cians based on recommendations and many
then click through to buy songs or end up pay-
ing to see them live.
There is also the argument that Spotifys key
demographic young and internet-savvy are
exactly the same people who would download
tracks illegally from file sharing sites. That was-
nt enough to convince Coldplay though, with
the band refusing to put their latest record on
the service (personally, I think fewer Coldplay
records is another reason to sign up).
A few bands opting out wont be enough to
stop Spotifys march to world domination.
Digital sales of music have increased 1,000-fold
in the last seven years, according to the
International Federation of the Phonographic
Industry, while the industry as a whole has lost a
third of its value. Even the record labels have
woken up very late and with an outrageous
hangover to the fact that endless strings of 1s
and 0s are the future of the industry and Spotify,
having battled through its own problems, is the
darling of this new digital wave.
Just dont expect it to make anyone very rich.
Steve Dinneen is City A.M.s technology correspondent.
26
The Forum
CITYA.M. 14 NOVEMBER 2011
Record ten hits on the scale
of U2s The Joshua Tree and
youre a Spotify millionaire.
Spotify has the music world
gripped but it wont be a
panacea for squeezed artists
cityam.com/forum
STEVE DINEEN
Agree? Disagree? Got a sharp comment?
The Forum wants you to join the debate.
COMMENT NOW ON
Twitter: @cityamforum;
on the web: cityam.com/forum;
or by email: theforum@cityam.com.
Top responses will be reprinted in The Forum.
27
The Citys MP
says it is time to
prepare for some
difficult choices
Britain must be
ready to bail out
Italy via the IMF
W
ITHOUT stable financial markets,
there is little hope for the sustained
growth so essential for economic
recovery. The UK economy is a global
leader in the financial services sector but this
leaves it especially prone to the adverse impact
of uncertainty on global financial markets.
No UK taxpayer stands by while unimagin-
ably large sums or guarantees go to bail out
the banking system with any sense of satisfac-
tion. Indeed, our own Prime Minister and
chancellor have repeatedly pledged that there
will be no further bailouts of the Eurozone.
Regrettably, however, the seventeen-nation
Eurozone lacks a central bank with the politi-
cal clout or, more important still, sufficient
funds to provide comprehensive cover in the
event of a liquidity crisis of similar severity to
the credit crunch of 2008. This is partly an
issue of design when the euro was set up as
well as a reflection of the historical reluctance
of Europes economic powerhouse, Germany,
to surrender control of its financial destiny.
The European Central Banks (ECB) mandate
should now be to provide market intervention
to maintain and restore confidence on behalf
of all solvent Eurozone economies. But it is
clear that Angela Merkel in Germany, whose
domestic political position appears ever more
precarious, will not cede control of this deep-
ening crisis to the ECB. Politically this would
require as ever within the EU bypassing
democratic safeguards and potentially involve
unfathomably vast quantities of central bank
support with potentially hazardous medium-
term economic consequences.
In short, while the ECB and the EFSF (the
dedicated fund set up to rescue struggling
economies in the Eurozone) is sufficiently cap-
italised to keep smaller Eurozone economies
such as Greece, Portugal and Ireland afloat, it
is woefully inadequate to provide the same
security in the event of a market run on
economies the size of Italy and Spain.
This is the problem that will soon confront
the Eurozone, the EU and the global economic
system. If Italy is close to default the only insti-
tution capable of bailing it out is the IMF.
In the event of such a collapse in market
confidence for Italy or Spain, the UK as a
founder member of the IMF will almost cer-
tainly need to increase both its absolute fund-
ing and its guarantee facilities to the fund. This
is an extremely unpalatable prospect.
Nevertheless, a failure to act by the UK would
not only have immediate serious consequences
to the financial services sector globally, but
would amount to abdication of our responsi-
bilities as a mercantile nation in the interna-
tional field of trade and commerce.
As MP for the City of London I accept reluc-
tantly, in the absence of German backing of
the ECB, that I have little choice but to support
a proposal by the UK government to under-
write further funds in this way to the IMF.
Nevertheless I also regard this as a matter
that must be addressed not by the executive
alone but in parliament. If the UK taxpayer is
to be further exposed to IMF loans and guaran-
tees this must only happen following a Prime
Ministerial statement outlining why such
action is in the national interest; after a full
parliamentary debate and finally as a conse-
quence of an affirmative vote in parliament.
Mark Field is the MP for the Cities of London
and Westminster.
Science v politics
Marc Sidwell is right to wish for
fewer appeals to consensus in
political life [Lets agree weve had
enough of consensus, Friday]. Most
political questions are of precisely
the kind that do not (and should
not) permit consensus. Its differ-
ent in science, where consensus
doesnt mean passive observance
of an agreed party line, but rather,
a collective but provisional view
about what is currently the best
hypothesis to explain natural phe-
nomena for example, that the
solar system is heliocentric and
that plate tectonics explains the
configuration of the continents. It
should not be confused with con-
servatism a reluctance to accept
new ideas or biased adherence
to a particular theory. Both of the
latter played a part in Linus
Paulings rejection of quasicrystals:
Pauling thought he had a better
explanation of the experimental
results, and he was notoriously
dogmatic about his own theories.
This years chemistry Nobel laure-
ate Dan Shechtman was unfairly
criticised for his early claims about
quasicrystals, but not for long and
not by everyone. Apart from some
old and very well-established
notions such as those above, con-
sensus is actually rather rare in sci-
ence. Conservatism is much more
common, but thats the price you
pay for a methodology that works
so well. Political conservatism can
offer no such justification.
Philip Ball, author and science
writer, www.philipball.com
RAPID RESPONSES
MARK FIELD MP
CITYA.M. 14 NOVEMBER 2011
The Forum
A
S A keen
rower since
my school-
days, I have a
long track record of
steering a course
through choppy waters.
I suspect this may
come in useful over the
next twelve months. Having taken over as Lord
Mayor at a time when the political and economic
environment remains turbulent and popular opin-
ion towards the City of London polarised I am
determined to prove that we are Fit for the Future,
the theme for my year in office.
This will require joining the dots between domes-
tic and international issues, between ourselves and
the rest of the UK, and between financial services
and other industries.
We are in the midst of a great public debate
about the role of the City and how it serves the
wider economy and our communities. I welcome
that debate and as Lord Mayor I will make the case
wholeheartedly for the City.
The City is a huge wealth producer and source of
tax, which makes a major contribution to the
nations wellbeing. That doesnt mean that we have
to take the bad things as well it means that we
have to get it right.
I wont pretend that the UK financial and profes-
sional services industry is perfect, but there is a
need to communicate what it does well and what it
is going to do better. And thats a challenge when
most people in the country think that banks, indis-
criminately, are a bad thing.
I know from my Yorkshire roots that the City
does care about manufacturing and other industries
but we must spread this message wider.
The Citys economic footprint is more than just
the Square Mile and banks although they are both
important components. Yorkshire, Scotland,
Liverpool, Manchester, Norwich and many other
parts of the UK are home to successful financial
institutions responsible for employing hundreds of
thousands of people. And too few people realise
that for every job created in financial services, at
least one more is created elsewhere.
The civic City also makes a major contribution
through connections with communities that need a
helping hand. The City Corporations own charitable
arm the City Bridge Trust has over the last
decade given a quarter of a billion pounds to help
Londoners in need while our livery companies, the
whole network of churches, clubs and charities
across the Square Mile all do fantastic work.
But there is always more that can be done.
Strengthening the emerging social investment mar-
ket and increasing the number of business angels
supporting innovative, high-tech start-ups are major
priorities.
I will strive to do my part through my Fit for the
Future Appeal, which aims to benefit ordinary peo-
ple who are ill or suffer injury and need top-class
and immediate medical attention or who need
open spaces and open-air sporting facilities to take
more exercise and enjoy more healthy lives.
As an Olympic Lord Mayor albeit one whose
chances of a gold medal are slim I want to show-
case the best of the City. The eyes of the world will
be trained on us and we must all pull hard in the
same direction to cross these choppy waters ahead
of the field.
David Wootton is Lord Mayor of the City of
London.
The new Lord Mayors
message for the City
Email: theforum@cityam.com
Twitter: @cityamforum
In association with
BY DAVID WOOTTON
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the system offers default settings that
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ERE are two innovations that allow
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Traders can cash in
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Zignals and eToro offer
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THE TIPSTER
TRYING TO
SPOT GOLD
SHINING
T
HE retreat of gold from the $1,800
highs last week found good support
from the former resistance level
around $1,750. It finished last week
on a strong footing, back above the key
$1,772 Fibonacci level. $1,800 proved
strong resistance though, so look to either
sell short as it approaches it again, or buy
above $1,805 if it breaks out. Spread Co
offers a spread on Spot Gold of $1783.2-
$1783.6.
Burberry announces interims on
Tuesday and expectations are for another
bumper round of numbers. The stock has
benefited from its exposure to Asian mar-
kets, which has led to its share price
bucking the market trend by gaining
some 30 per cent. Recently the share
price has been suffering from a little
fatigue, but the recent weakness could
present a buying opportunity. Capital
Spreads quotes a price of 1,381.2-1,387.8.
Recent talk of sterling becoming an
asset to invest in in times of turmoil has
helped to prop it up against other curren-
cies. But early indications of inflation
numbers out on Tuesday point to a slight
slow down for the month of October, fur-
ther bolstering the Bank of Englands
stance to keep rates at ultra-low levels
and maintain their asset purchase pro-
gramme. Along with unemployment and
retail sales figures out mid-week, and
both showing signs of weakening, sterling
could be weaken considerably from cur-
rent levels. ETX Capital quotes $1.5912-
$1.5915 for the sterling-dollar rolling
daily contract.
The third quarter update from the
aero-engine maker Rolls Royce certainly
cheered investors at the end of last week,
with the companys global customer base
helping it to navigate around at least
some of the global turbulence were see-
ing right now. The share price has howev-
er been pushed out to fresh highs, and
any squeeze on commercial lending could
arguably see pressure on the firm
increasing in the longer term. Current IG
Index price on Rolls Royce is 732.8p-
735.2p.
Craig Drake
28
Wealth Management | Spread Betting
THE WEEK AHEAD in association with
COMPANY NEWS
l Today, Electrocomponents announces its results
for the half year ended 30 September. The Oxford-
based company is the worlds largest distributor of
electronics and maintenance products and will be
hoping that there are no blown fuses over the
results.
l Lonmin, the platinum producer with the bulk of
its operations in South Africa will announce its
interim results today.
l ICAP and Burberry Group both announce
tomorrow. Burberry will be hoping that its sales
have been un-checked by the global slowdown.
COMPANY NEWS
l SABMiller announces its interim results on
Thursday. Earlier this month, the international
brewing company uncapped the first ever cassava-
based beer, brewed in Mozambique, and released it
to the commercial market.
l National Grid will also announce interim results
Thursday. The electric transmission network will
be hoping that it wont get any nasty shocks.
l Rexam releases an interim managerial state-
ment on Thursday. With the costs of raw materials
falling, we should see a positive update, but noth-
ing is certain in the current market climate.
ECONOMICS
l Tomorrow, the UK Consumer Price Index for
October will be released. The CPI index hit 5.2 per
cent in September, equalling the highest reading
for the index ever, will we see a fall this time
round?
l The Bank of Japan will release its interest rates
decision Wednesday. The BoJ is not expected to
stray from last months rate of 0.1 per cent, as the
rate has been consistent over the last year.
l On Friday, Canada will also release its Consumer
Price Index figures for October, previously at 3.2
per cent.
POLITICAL NEWS
l Hillary Clinton, United States secretary of state,
is set to visit Thailand and the Philippines next
week, in addition to attending the Asia-Pacific
Economic Cooperation forum in Bali. Clintons 15
November trip to Manila will commemorate the
60th anniversary of the US-Philippines Mutual
Defence Treaty.
l The issue of the EUs carbon emissions will be
back on the table next week. Earlier in the year, it
was proposed that the current target of cutting
carbon emissions by 20 per cent be raised to 25
per cent by 2020, but the move was blocked by
Poland, current holder of the EU presidency.
P
i
c
t
u
r
e
s
:

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E
X
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which spread
will be better
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Spread betting and CFD trading can result in losses that exceed your initial deposit.
Four areas in which the right platform
can give you the edge, says Philip Salter
W
ITH the news that Alpari,
the global foreign
exchange broker, is
extending its offerings to
spread betting joining a host of
other providers in a very competitive
market its worth considering
what traders should be demanding
from their providers. Start by look-
ing at aspects of the spreads on offer
as well the providers platform sta-
bility and mobility.
1. CHECK THE SPREADS
Brenda Kelly of CMC Markets says
there is significant competition
among spread betting companies
when it comes to claims of spreads.
She thinks its always worth fully
researching these claims as this is
the singular most important consid-
eration, since your potential trading
will be adversely impacted by large
spreads.
Spreads should be a considera-
tion, but they arent the be all and
end all, as everyone tends to be
much of a muchness, says David
Jones of IG Index. If focusing on
spreads, Jones thinks traders should
look at things such as how likely
your trade is to go through at the
price offered. Jamie Blake, of Capital
Spreads, agrees: Getting the price
you want is important, so find out if
youre going to be regularly re-quot-
ed.
Elliott Winner, also of Capital
Spreads, is in favour of spread bet-
ting firms offering fixed spreads
throughout the 24-hour period.
Blake cautions: Some companies
will offer extraordinarily tight
spreads, but as soon as you see any
kind of volatility in a market they
can largely widen out. When choos-
ing, see if the spreads are fixed or
variable, and if variable, find out
what sort of expansion youre going
to see on them.
2. GET STABLE PLATFORMS
Jones thinks the functionality of
trading platforms is important. He
says it has to be functional but not
clunky you want something with
all the tools, but also quick enough
to execute your trades in a timely
manner. A platforms tools are also
important. Kelly notes: Charting
and a large range of the traditional
and innovative technical analysis
tools are the bones of any decent
trading platform. She thinks these
should be free of charge and simple
to utilise. Blake warns traders to be
aware that some companies may
charge for extras like advanced
charting, while some providers will
offer this free of charge.
Depth of content risks confusion,
so a platform shouldnt be too com-
plicated, especially for neophytes.
Surveys suggest that a major attrib-
ute people are looking for in their
platform is simplicity, says Capital
Spreads Angus Campbell.
The best way to find the right plat-
form is to test out the demo
accounts of the various spread bet-
ting companies to see which best fits
in with your style. In the same way
that people will seemingly fight to
death defending Linux over
Windows, or Apple over PCs, there is
no best platform for everyone. And
given the innovation in this area,
with companies keen to keep one
step ahead of competitors, it is
worth stepping back and testing the
various offerings once in a while.
3. LOOK TO USE ON THE MOVE
Joshua Raymond of City Index
thinks being able to trade whenever
you want, wherever you are, is
absolutely crucial in todays mar-
kets particularly when they are as
highly volatile as they are today with
the Eurozone sovereign debt crisis.
He says being able to keep on top of
positions and react to market moves,
be it getting in or out of a market,
can be the difference between net-
ting a profitable or losing trade. As
such, Raymond suggests that access
to innovative and intuitive mobile
trading platforms that cater for your
mobile device be it iPhone,
Android or Blackberry is hugely
important.
Jones agrees: In this day and age
you should be able to access your
trading platform from virtually any-
where, so I think a companys com-
mitment to mobile dealing and good
old fashioned ring someone up and
deal is also an important one.
4. GETTING THE ADVANTAGE
The advantage that can be garnered
by using one platform over a com-
petitors is vital to a traders experi-
ence of spread betting. The wrong
company could put them off trading
for life. However, as with traders
platform shoes common at
Chicagos Board of Trade to rise
above the crowd during open outcry
whichever platform you trade
with, the most important variable
remains within your own control,
with the trading decisions you
choose to execute.
Pick the most stable platform you can find Picture:GETTY
EU SHARES
AIR LIQUIDE...............90.75 1.83 100.65 80.90
ALLIANZ .....................76.25 4.05 108.85 56.16
ANHEUS-BUSCH INBEV43.051.11 45.11 33.85
ARCELORMITTAL......14.29 0.54 28.55 10.47
AXA.............................10.61 0.41 16.16 7.88
BANCOSANTANDER ..5.81 0.23 9.20 5.05
BASF SE .....................51.60 1.40 70.22 42.19
BAYER.........................48.09 1.66 59.44 35.36
BBVA.............................6.17 0.28 9.17 4.94
BMW............................58.73 1.12 73.85 43.49
BNP PARIBAS ............32.24 1.73 59.93 22.72
CARREFOUR..............20.24 0.85 34.12 14.66
CRH PLC.....................13.55 0.50 17.40 10.28
DAIMLER ....................34.05 0.81 59.09 30.52
DANONE .....................48.95 0.76 53.16 41.92
DEU.BOERSE OFFRE41.81 1.46 55.75 35.46
DEUTSCHE BANK......29.00 1.60 48.70 20.79
DEUTSCHE TELEKOM 9.43 0.31 11.38 7.88
E.ON............................17.80 0.84 25.54 12.50
ENEL .............................3.28 0.10 4.86 2.81
ENI ...............................15.70 0.21 18.66 11.83
FRANCE TELECOM...12.77 0.31 17.19 11.12
GDF SUEZ...................20.50 0.53 30.05 18.32
GENERALIASS. .........12.42 0.28 17.05 10.34
IBERDROLA .................4.95 0.16 6.50 4.29
INDITEX.......................65.80 2.25 69.40 50.92
INGGROEP CVA..........5.92 0.25 9.50 4.21
INTESA SANPAOLO.....1.28 0.10 2.47 0.85
KON.PHILIPS ELECTR14.51 0.22 25.45 12.01
L'OREAL .....................78.50 0.93 91.24 68.83
LVMH.........................117.00 2.45 132.65 94.16
MUNICH RE ................91.77 3.67 126.00 77.80
NOKIA...........................4.93 0.19 8.49 3.33
REPSOL YPF ..............22.35 0.56 24.90 17.31
RWE.............................30.18 1.41 55.88 21.22
SAINT-GOBAIN...........31.36 1.37 47.64 26.07
SANOFI .......................49.65 0.58 56.82 42.85
SAP .............................44.35 0.67 46.15 32.88
SCHNEIDER ELECTRIC41.47 2.64 61.83 35.94
SIEMENS.....................74.14 1.73 99.39 62.13
SOCIETE GENERALE18.86 0.76 52.70 14.32
TELECOMITALIA.........0.89 0.05 1.16 0.70
TELEFONICA..............14.18 0.24 18.75 12.50
TOTAL .........................37.64 0.64 44.55 29.40
UNIBAIL-RODAMCOSE137.052.30 162.95 124.05
UNICREDIT ...................0.83 0.04 2.03 0.64
UNILEVER CVA ..........24.69 0.42 25.13 20.90
VINCI ...........................33.28 1.23 45.48 29.49
VIVENDI ......................15.87 0.41 22.07 14.10
VOLKSWAGEN VORZ130.60 4.45 152.20 86.40
Price Chg High Low Price Chg High Low
WORLDINDICES
US SHARES
3M.................................82.29 1.97 98.19 68.63
ABBOTT LABS............54.53 0.58 55.61 45.07
ALCOA.........................10.60 0.35 18.47 8.45
ALTRIA GROUP...........27.78 0.15 28.14 23.20
AMAZON.COM...........217.39 6.60 246.71 156.77
AMERICAN EXPRESS 50.37 1.28 53.80 41.25
AMGEN INC.................57.86 -0.10 61.53 47.66
APPLE........................384.62 -0.60 426.70 297.76
AT&T.............................29.42 0.26 31.94 27.20
BANK OFAMERICA......6.21 0.18 15.31 5.13
BERKSHIRE HATAWB76.97 0.98 87.65 65.35
BOEING CO.................66.92 2.09 80.65 56.01
BRISTOL MYERS SQUI31.79 0.47 33.27 20.05
CATERPILLAR.............96.13 3.93 116.55 67.54
CHEVRON..................107.05 1.55 110.01 80.41
CISCOSYSTEMS ........19.02 0.41 24.51 13.30
CITIGROUP..................29.33 0.70 51.50 21.40
COCA-COLA................68.12 0.73 71.77 61.29
COLGATE PALMOLIVE89.17 1.03 94.89 74.86
CONOCOPHILLIPS .....72.14 0.70 81.80 58.65
CVS/CAREMARK ........39.24 0.74 39.50 29.45
DU PONT(EI)DE NMR.48.52 1.01 57.00 37.10
EXXON MOBIL.............79.72 1.02 88.23 63.47
GENERAL ELECTRIC .16.30 0.24 21.65 14.02
GOOGLE A.................608.35 13.27 642.96 473.02
HEWLETTPACKARD..27.59 0.83 49.39 19.92
HOME DEPOT..............38.06 0.86 39.38 28.13
IBM.............................187.38 4.03 190.53 141.18
INTEL CORP................24.85 0.79 26.78 19.16
J.P.MORGAN CHASE..33.28 0.54 48.36 27.85
JOHNSON & JOHNSON65.25 1.13 68.05 57.50
KRAFTFOODS A ........35.57 0.44 36.30 24.30
MC DONALD'S CORP.94.76 1.50 95.45 72.14
MERCK AND CO.NEW35.98 1.01 37.65 29.47
MICROSOFT ................26.91 0.63 29.46 23.65
OCCID.PETROLEUM..99.81 1.67 117.89 66.36
ORACLE CORP ...........32.37 0.64 36.50 24.72
PEPSICO......................63.28 0.31 71.89 58.50
PFIZER.........................19.99 0.19 21.45 16.25
PHILIP MORRIS INTL..71.64 0.64 72.74 55.85
PROCTER AND GAMBLE63.890.64 67.72 56.57
QUALCOMMINC.........56.62 1.41 59.84 45.98
SCHLUMBERGER.......76.54 2.49 95.64 54.79
TRAVELERS CIES.......58.43 1.02 64.17 45.97
UNION PACIFIC.........102.88 2.50 107.89 77.73
UNITED TECHNOLOGIE79.83 2.36 91.83 66.87
VERIZON COMMS.......37.52 0.19 38.95 31.60
WAL-MARTSTORES...59.20 1.07 59.40 48.31
WALTDISNEY CO.......36.70 2.06 44.34 28.19
WELLS FARGO& CO .25.65 0.57 34.25 22.58
FTSE 100 . . . . . . . . . . . . . . 5545.38 100.56 1.85
FTSE 250 INDEX . . . . . . . 10389.30 201.86 1.98
FTSE UK ALL SHARE ....2857.02 51.43 1.83
FTSE AIMALL SH . . . . . . . . 727.99 13.07 1.83
DOWJONES INDUS 30 ..12153.68 259.89 2.19
S&P 500 . . . . . . . . . . . . . . . 1263.85 24.15 1.95
NASDAQCOMPOSITE ...2678.75 53.60 2.04
FTSEUROFIRST 300 . . . . . . 984.62 21.04 2.18
NIKKEI225AVERAGE....8514.47 13.67 0.16
DAX 30PERFORMANCE..6057.03 189.22 3.22
CAC 40 . . . . . . . . . . . . . . . . 3149.38 84.54 2.76
SHANGHAISE INDEX ....2481.08 1.55 0.06
HANG SENG. . . . . . . . . . . 19137.17 173.28 0.91
S&P/ASX 20INDEX ......2587.70 29.70 1.16
ASX ALL ORDINARIES ...4358.60 51.30 1.19
BOVESPA SAOPAOLO..58546.97 1225.16 2.14
ISEQOVERALL INDEX ...2697.11 35.24 1.32
STI . . . . . . . . . . . . . . . . . . . . 2778.97 34.80 1.27
IGBM. . . . . . . . . . . . . . . . . . . 857.98 24.85 2.98
SWISS MARKETINDEX...5649.03 83.25 1.50
Price Chg %chg Price Chg %chg Price Chg %chg
LONGDONCEFIXAM .........................................1764.00 -2.00
SILVERLDNFIXAM.................................................34.53 1.06
MAPLELEAF1OZ...................................................37.27 0.71
LONPLATINUMAM..............................................1626.00 -2.00
LONPALLADIUMAM .............................................648.00 3.00
ALUMINIUMCASH................................................2111.50 3.50
COPPERCASH ....................................................7455.00 -216.50
LEADCASH .........................................................1921.00 -45.50
NICKELCASH ....................................................18145.00 -35.00
TINCASH...........................................................21280.00 -500.00
ZINCCASH ..........................................................1882.00 -63.00
BRENTSPOTINDEX ..............................................113.38 -0.43
SOYA....................................................................1158.00 -13.25
COCOA ................................................................2504.00 21.00
COFFEE .................................................................230.00 -3.45
KRUG...................................................................1834.80 0.00
WHEAT...................................................................149.75 -1.02
COMMODITIES CREDIT&RATES
BoE IR Overnight .....................................................................0.500 0.00
BoE IR 7 days..........................................................................0.500 0.00
BoE IR 1 month.......................................................................0.500 0.00
BoE IR 3 months.....................................................................0.500 0.00
BoE IR 6 months.....................................................................0.500 0.00
LIBOR Euro - overnight...........................................................0.656 0.00
LIBOR Euro - 12 months .........................................................2.000 0.00
LIBOR USD - overnight ...........................................................0.146 0.00
LIBOR USD - 12 months..........................................................0.981 0.00
HaIifax mortgage rate..............................................................3.990 0.00
Euro Base Rate ........................................................................1.500 0.00
Finance house base rate.........................................................1.000 0.00
US Fed funds............................................................................0.250 0.00
US Iong bond yieId ..................................................................3.110 -0.64
European repo rate..................................................................0.501 -0.01
Euro Euribor.............................................................................0.926 0.00
The vix index............................................................................30.10 -2.71
The baItic dry index.................................................................1.840 0.03
Markit iBoxx ...........................................................................238.98 -0.48
Markit iTraxx...........................................................................185.19 2.41
C/$ 1.3751 0.0143
C/ 0.8563 0.0022
C/ 106.22 0.0150
/C 1.1678 0.0031
/$ 1.6059 0.0127
/ 124.04 0.3216
FTSE100
5545.38
100.56
FTSE250
10389.30
201.86
FTSEALL SHARE
2857.02
51.43
DOW
12153.68
259.89
NASDAQ
2678.75
53.60
S&P500
1263.85
24.15
Rexam . . . . . . . . . . . .335.0 7.3 400.0 299.8
RPC Group . . . . . . . .354.2 3.9 384.8 215.4
Smiths Group . . . . . .947.0 26.5 1429.0 907.5
Brown (N.) Group . . .262.2 0.2 311.2 251.1
Carpetright . . . . . . . . .450.0 -4.2 835.5 440.1
Debenhams . . . . . . . . .63.5 0.0 75.7 51.2
Dignity . . . . . . . . . . . .814.5 9.0 854.5 644.0
Dixons RetaiI . . . . . . .11.8 0.5 26.6 10.6
DuneImGroup. . . . . .498.0 -8.0 550.0 383.9
HaIfords Group . . . . .341.1 -0.5 459.7 268.6
Home RetaiI Group. . .84.4 0.2 235.0 82.5
Inchcape . . . . . . . . . .334.2 16.2 425.4 268.1
JD Sports Fashion . .830.0 1.0 1030.0 770.5
Kesa EIectricaIs . . . . .93.4 3.7 174.0 80.0
Kingfisher . . . . . . . . .256.0 6.0 287.1 217.0
Marks & Spencer G. .331.9 9.3 403.9 301.8
Mothercare . . . . . . . .158.5 -0.5 627.5 151.0
Next . . . . . . . . . . . . .2785.0 37.0 2798.0 1868.0
Sports Direct Int . . . .237.9 0.5 266.2 127.0
WH Smith. . . . . . . . . .519.0 2.0 558.0 433.8
Smith & Nephew. . . .558.0 10.0 742.0 521.0
Synergy HeaIth . . . . .845.0 10.0 981.0 775.0
Barratt DeveIopme . . .91.1 3.6 119.0 67.5
YuIe Catto & Co. . . . .160.8 5.7 253.0 148.0
BaIfour Beatty . . . . . .237.1 2.7 357.3 228.6
GaIIiford Try. . . . . . . .490.0 16.5 530.0 276.5
Kier Group. . . . . . . .1414.0 -34.0 1453.0 1097.0
Drax Group . . . . . . . .571.5 14.0 574.0 353.6
SSE. . . . . . . . . . . . . .1325.0 17.0 1423.0 1111.0
Domino Printing S . .551.0 10.5 705.0 434.3
HaIma . . . . . . . . . . . . .343.0 6.9 429.6 306.3
Laird . . . . . . . . . . . . . .146.5 2.8 207.0 127.9
Morgan CrucibIe C . .277.1 9.4 357.1 222.3
Oxford Instrument . .820.0 9.0 1010.0 495.0
Renishaw. . . . . . . . . .935.0 33.5 1886.0 862.0
Spectris . . . . . . . . . .1336.0 107.0 1679.0 1039.0
Aberforth SmaIIer . . .535.5 6.5 714.0 508.5
AIIiance Trust . . . . . .338.3 4.1 392.7 310.2
Bankers Inv Trust . . .381.0 3.9 428.0 346.5
BH GIobaI Ltd. GB .1190.0 -4.0 1210.0 1058.0
BH GIobaI Ltd. US. . . .11.9 0.0 12.2 10.4
BH Macro Ltd. EUR. . .20.1 0.1 20.2 15.8
BH Macro Ltd. GBP 2065.0 -10.0 2078.0 1630.0
BH Macro Ltd. USD. . .19.9 0.1 20.1 15.8
BIackRock WorId M .659.5 15.5 815.5 574.5
BIueCrest AIIBIue . . .167.7 -0.5 176.2 162.4
British Assets Tr . . . .119.0 1.5 140.5 109.0
British Empire Se . . .447.5 9.3 533.0 409.9
CaIedonia Investm .1506.0 33.0 1928.0 1470.0
City of London In . . .281.0 5.0 306.9 257.0
Dexion AbsoIute L . .135.6 0.8 151.0 130.0
Edinburgh Dragon . .218.2 1.8 262.1 201.4
Edinburgh Inv Tru. . .466.4 11.9 492.2 414.9
EIectra Private E . . .1470.0 -9.0 1755.0 1287.0
F&C Inv Trust . . . . . .290.4 6.2 327.9 261.5
FideIity China Sp. . . . .78.0 0.0 126.7 70.0
FideIity European . .1010.0 38.5 1287.0 912.0
HeraId Inv Trust. . . . .452.4 6.4 545.5 419.0
HICL Infrastructu. . . .118.6 0.3 121.3 112.7
Impax Environment . .93.8 1.8 130.5 88.5
JPMorgan American.824.0 20.5 916.0 721.5
JPMorgan Asian In . .193.5 1.5 250.8 170.1
JPMorgan Emerging.516.5 0.5 639.0 480.1
JPMorgan European.698.0 9.0 983.5 685.0
JPMorgan Indian I. . .359.5 -1.5 494.5 350.0
JPMorgan Russian .492.0 -0.1 755.0 415.1
Law Debenture Cor. .353.0 4.9 385.0 309.8
MercantiIe Inv Tr . . . .917.0 17.0 1137.0 856.5
Merchants Trust . . . .366.1 3.1 431.8 347.0
Monks Inv Trust . . . .317.0 3.0 367.9 298.1
Murray Income Tru . .611.5 9.0 673.0 568.0
Murray Internatio . . .895.0 6.5 991.5 818.5
PerpetuaI Income . . .250.1 3.6 276.0 234.8
PersonaI Assets T .33810.0 310.0 33850.030210.0
PoIar Cap TechnoI . .341.5 1.5 391.2 299.5
RIT CapitaI Partn. . .1336.0 3.0 1360.0 1131.0
Scottish Inv Trus. . . .450.0 6.0 524.0 417.0
Scottish Mortgage . .637.5 9.5 781.0 586.5
SVG CapitaI . . . . . . . .193.7 -0.6 279.8 187.9
TempIe Bar Inv Tr . . .867.0 13.0 952.0 791.0
TempIeton Emergin .567.5 13.0 689.5 497.0
TR Property Inv T . . .163.2 1.6 206.1 150.0
TR Property Inv T . . . .75.4 0.0 94.0 69.5
Witan Inv Trust . . . . .447.0 8.0 533.0 401.5
3i Group. . . . . . . . . . .204.8 5.9 340.0 184.1
3i Infrastructure . . . .120.0 0.0 125.2 113.1
Aberdeen Asset Ma .194.3 4.4 240.0 167.8
Ashmore Group . . . .346.2 13.1 420.0 301.5
Brewin DoIphin Ho . .124.0 -0.7 185.4 113.7
CameIIia. . . . . . . . . .9250.0 150.010950.0 8800.0
CharIes TayIor Co. . .135.0 0.5 185.5 122.0
City of London Gr . . . .64.0 -1.5 93.6 62.0
City of London In . . .347.5 0.8 461.5 321.3
CIose Brothers Gr. . .715.0 14.5 888.5 656.5
CoIIins Stewart H . . . .54.0 -1.0 90.8 54.0
EvoIution Group . . . . .84.0 3.3 94.0 62.3
F&C Asset Managem .69.8 0.8 92.9 56.1
Hargreaves Lansdo .511.0 23.7 646.5 402.5
HeIphire Group . . . . . . .2.7 -0.1 19.3 2.2
Henderson Group . . .116.8 4.8 173.1 95.1
Highway CapitaI . . . . .12.0 0.0 21.0 6.5
ICAP . . . . . . . . . . . . . .370.5 12.4 570.5 350.4
IG Group HoIdings . .452.8 1.5 528.0 393.6
Intermediate Capi . . .228.2 4.3 360.3 197.9
InternationaI Per . . . .222.8 7.4 388.8 196.5
InternationaI Pub. . . .116.7 0.1 118.3 108.6
Investec . . . . . . . . . . .374.2 14.7 538.0 331.8
IP Group. . . . . . . . . . . .76.5 0.8 79.3 29.9
Jupiter Fund Mana . .218.9 5.0 337.3 184.9
Liontrust Asset M . . . .58.3 0.0 94.3 57.0
LMS CapitaI . . . . . . . . .59.5 0.0 64.8 44.8
London Finance & . . .23.0 0.0 23.5 16.5
London Stock Exch .870.5 24.0 1076.0 717.0
Lonrho . . . . . . . . . . . . .13.0 1.3 19.8 11.8
Man Group. . . . . . . . .149.2 5.9 311.0 136.0
Paragon Group Of . .179.4 -1.1 206.1 134.6
Provident Financi . .1036.0 -9.0 1124.0 728.5
Rathbone Brothers .1127.0 0.0 1257.0 972.0
Record . . . . . . . . . . . . .16.6 0.3 43.0 15.9
RSM Tenon Group . . .22.5 0.0 66.3 20.3
Schroders . . . . . . . .1393.0 89.0 1922.0 1183.0
Schroders (Non-Vo .1163.0 54.0 1554.0 970.0
TuIIett Prebon . . . . . .315.0 9.5 428.6 303.0
WaIker Crips Grou . . .46.0 0.0 51.5 45.0
BT Group . . . . . . . . . .190.9 2.5 204.1 161.0
CabIe & WireIess . . . .38.3 1.3 52.9 31.3
CabIe & WireIess . . . .30.4 0.3 76.9 26.3
COLT Group SA . . . .100.5 2.1 156.2 91.6
KCOM Group. . . . . . . .72.0 -0.5 84.0 48.5
TaIkTaIk TeIecom . . .132.7 4.6 168.3 119.8
TeIecomPIus. . . . . . .714.0 -7.0 750.5 379.8
Booker Group . . . . . . .77.9 1.2 80.0 54.5
Greggs . . . . . . . . . . . .512.5 0.5 550.5 429.1
Morrison (Wm) Sup .317.4 -0.4 319.4 262.7
Ocado Group. . . . . . . .86.2 -0.6 285.0 84.8
Sainsbury (J) . . . . . . .307.1 10.4 391.5 263.5
Tesco . . . . . . . . . . . . .403.6 3.5 439.0 356.3
Associated Britis. . .1132.0 14.0 1182.0 940.0
Cranswick . . . . . . . . .713.0 -0.5 883.5 588.5
Dairy Crest Group. . .337.6 5.8 424.9 325.0
Devro . . . . . . . . . . . . .263.0 4.7 296.9 223.5
Premier Foods. . . . . . . .6.4 1.9 35.1 3.3
Tate & LyIe. . . . . . . . .677.5 10.0 684.5 510.0
UniIever . . . . . . . . . .2077.0 37.0 2114.0 1777.0
Mondi . . . . . . . . . . . . .463.0 9.3 664.0 448.1
Centrica . . . . . . . . . . .303.3 6.1 345.8 282.6
InternationaI Pow . . .338.5 6.4 448.6 279.4
NationaI Grid . . . . . . .629.0 17.0 649.5 530.0
Pennon Group. . . . . .721.5 13.0 737.5 584.5
Severn Trent . . . . . .1599.0 23.0 1604.0 1368.0
United UtiIities . . . . .631.0 14.0 633.5 543.5
Cookson Group . . . . .465.8 9.8 724.5 395.8
DS Smith . . . . . . . . . .205.4 2.5 266.2 164.4
BAE Systems . . . . . .283.3 10.4 361.1 248.1
Chemring Group. . . .520.5 14.0 736.5 485.0
Cobham . . . . . . . . . . .180.6 2.7 236.5 168.5
Meggitt . . . . . . . . . . . .383.8 14.1 397.6 304.9
QinetiQ Group. . . . . .121.3 2.5 136.3 96.7
RoIIs-Royce Group. .738.0 28.5 740.0 557.5
Senior. . . . . . . . . . . . .168.0 3.7 190.6 132.6
UItra EIectronics . . .1607.0 22.0 1830.0 1305.0
GKN . . . . . . . . . . . . . .192.9 3.1 245.0 157.0
BarcIays. . . . . . . . . . .178.9 8.9 333.6 138.9
HSBC HoIdings. . . . .503.3 6.4 730.9 473.6
LIoyds Banking Gr . . .28.8 1.7 69.9 27.2
RoyaI Bank of Sco . . .22.5 1.4 49.0 19.7
Standard Chartere .1402.0 12.0 1901.5 1169.5
AG Barr . . . . . . . . . .1259.0 -8.0 1395.0 1031.0
Britvic. . . . . . . . . . . . .330.7 7.7 503.5 289.9
Diageo . . . . . . . . . . .1328.0 25.0 1344.0 1112.0
SABMiIIer. . . . . . . . .2251.0 46.0 2354.5 1979.0
AZ EIectronic Mat . . .240.0 8.5 338.1 206.1
Croda Internation . .1786.0 74.0 2081.0 1367.0
EIementis. . . . . . . . . .138.0 4.0 187.4 104.8
Johnson Matthey . .1885.0 59.0 2119.0 1523.0
Victrex . . . . . . . . . . .1207.0 18.0 1590.0 1025.0
Price Chg High Low
BeIIway. . . . . . . . . . . .710.5 9.5 753.5 511.0
BerkeIey Group Ho.1242.0 28.0 1299.0 789.5
Bovis Homes Group.451.0 -7.1 485.5 326.5
Persimmon . . . . . . . .486.5 7.6 518.5 338.4
Reckitt Benckiser . .3259.0 58.0 3648.0 3015.0
Redrow. . . . . . . . . . . .112.0 2.2 139.0 98.4
TayIor Wimpey . . . . . . .37.5 0.7 43.3 23.8
Bodycote . . . . . . . . . .278.5 4.9 397.7 225.6
Charter Internati . . . .922.5 3.5 926.5 538.5
Fenner . . . . . . . . . . . .367.9 17.8 422.5 273.7
IMI . . . . . . . . . . . . . . . .809.0 14.5 1119.0 636.5
MeIrose . . . . . . . . . . .346.3 11.4 365.4 265.7
Northgate. . . . . . . . . .244.0 1.3 346.7 202.0
Rotork . . . . . . . . . . .1720.0 28.0 1858.0 1501.0
Spirax-Sarco Engi. .1880.0 47.0 2063.0 1649.0
Weir Group . . . . . . .1960.0 97.0 2218.0 1375.0
Ferrexpo. . . . . . . . . . .315.2 5.2 499.0 238.7
TaIvivaara Mining . . .216.0 6.0 622.0 205.0
BBAAviation . . . . . . .182.5 6.9 240.8 156.0
Stobart Group Ltd. . .118.1 -0.9 163.6 117.5
AdmiraI Group. . . . . .840.0 20.0 1754.0 796.0
Haynes PubIishing . .220.0 -5.0 257.0 203.5
Huntsworth . . . . . . . . .58.0 -2.6 85.0 55.3
Informa. . . . . . . . . . . .372.1 6.9 461.1 313.9
ITE Group. . . . . . . . . .193.0 1.7 258.2 157.7
ITV. . . . . . . . . . . . . . . . .63.7 0.4 93.5 51.7
Johnston Press. . . . . . .5.0 -0.1 12.8 4.1
MecomGroup . . . . . .152.3 -2.0 310.0 134.5
Moneysupermarket. .109.5 0.8 120.4 75.7
Pearson . . . . . . . . . .1137.0 18.0 1207.0 926.0
PerformGroup . . . . .197.0 -3.2 234.5 150.0
Reed EIsevier . . . . . .545.0 10.5 590.5 461.3
Rightmove . . . . . . . .1398.0 32.0 1408.0 736.5
STV Group. . . . . . . . .105.9 -0.1 168.0 90.3
Tarsus Group . . . . . .128.0 -1.5 165.0 114.0
Trinity Mirror . . . . . . . .51.5 1.8 93.0 37.5
UBM . . . . . . . . . . . . . .499.5 23.6 725.0 416.0
UTV Media . . . . . . . . .112.8 -2.3 150.0 101.0
WiImington Group . . .87.5 0.5 183.0 82.5
WPP . . . . . . . . . . . . . .669.5 18.5 846.5 578.0
YeII Group . . . . . . . . . . .3.4 -0.0 14.8 3.3
African Barrick G . . .563.5 9.5 618.5 393.5
AIIied GoId Minin . . .156.0 -0.8 281.3 34.4
AngIo American . . .2467.0 83.5 3437.0 2138.5
AngIo Pacific Gro . . .276.9 11.3 369.3 237.9
Antofagasta . . . . . . .1198.0 39.0 1634.0 900.5
AmIin . . . . . . . . . . . . .299.4 7.2 427.0 270.6
BeazIey. . . . . . . . . . . .128.9 1.3 139.2 109.6
CatIin Group Ltd. . . .399.0 7.9 421.4 331.5
Hiscox Ltd. . . . . . . . . .393.7 0.6 424.7 340.5
Jardine LIoyd Tho. . .707.0 -3.0 764.5 571.5
Lancashire HoIdin . . .764.5 7.0 774.5 529.0
RSA Insurance Gro. .111.2 3.9 143.5 105.3
Aviva. . . . . . . . . . . . . .319.0 10.6 477.9 275.3
LegaI & GeneraI G . . .108.0 4.7 123.8 89.8
OId MutuaI . . . . . . . . .111.5 3.9 144.8 98.1
Phoenix Group HoI . .494.4 4.4 688.0 451.1
PrudentiaI . . . . . . . . .636.0 29.0 777.0 509.0
ResoIution Ltd. . . . . .270.4 7.3 316.1 211.3
St James's PIace. . . .340.4 9.4 376.0 236.2
Standard Life. . . . . . .205.7 2.4 244.7 172.0
4Imprint Group . . . . .230.0 10.0 295.0 200.0
Aegis Group . . . . . . .140.4 6.1 158.5 115.7
BIoomsbury PubIis. . .97.5 1.3 138.0 95.0
British Sky Broad . . .748.5 10.0 850.0 618.5
Centaur Media. . . . . . .36.0 0.0 73.0 36.0
Chime Communicati.200.5 1.3 298.5 173.0
Creston . . . . . . . . . . . .84.0 -0.8 121.0 72.0
DaiIy MaiI and Ge . . .428.5 10.8 594.5 343.4
Euromoney Institu . .692.0 5.0 736.0 522.5
Future. . . . . . . . . . . . . .10.5 0.0 30.0 9.8
Aquarius PIatinum . .177.2 6.5 419.0 159.9
BHP BiIIiton. . . . . . .1992.0 35.5 2631.5 1667.0
Centamin Egypt Lt . .107.4 0.4 186.7 89.7
Eurasian NaturaI . . .684.0 11.5 1125.0 522.0
FresniIIo. . . . . . . . . .1848.0 19.0 2150.0 1296.0
GemDiamonds Ltd. .234.4 2.9 306.0 179.8
GIencore Internat . . .440.0 4.5 531.1 348.0
HochschiId Mining . .444.1 6.6 680.0 397.0
Kazakhmys . . . . . . . .931.5 24.0 1671.0 730.0
Kenmare Resources. .40.5 1.3 59.9 23.4
Lonmin. . . . . . . . . . .1074.0 37.0 1983.0 974.5
New WorId Resourc .474.5 24.7 1060.0 410.5
PetropavIovsk . . . . . .746.5 18.0 1165.0 543.5
RandgoId Resource 7400.0 150.0 7555.0 4425.0
Rio Tinto . . . . . . . . .3467.5 48.5 4712.0 2712.5
Vedanta Resources.1162.0 31.0 2559.0 948.0
Xstrata . . . . . . . . . . .1030.0 27.0 1550.0 764.0
Inmarsat . . . . . . . . . . .468.7 12.8 719.5 389.7
Vodafone Group . . . .180.1 2.2 182.8 155.1
Genesis Emerging . .458.0 4.0 568.0 430.0
Afren. . . . . . . . . . . . . . .85.8 11.0 171.2 73.6
BG Group. . . . . . . . .1366.0 -13.5 1564.5 1144.0
BP. . . . . . . . . . . . . . . .458.3 9.7 509.0 363.2
Cairn Energy . . . . . . .295.4 9.5 469.7 261.4
EnQuest . . . . . . . . . . .104.6 0.5 158.5 86.6
Essar Energy . . . . . .288.8 14.6 589.5 235.1
ExiIIon Energy. . . . . .304.9 9.9 469.7 184.2
Heritage OiI . . . . . . . .202.0 1.8 486.0 190.0
Ophir Energy. . . . . . .252.1 5.1 299.0 184.5
Premier OiI. . . . . . . . .360.5 5.5 535.0 310.0
RoyaI Dutch SheII . .2206.0 33.5 2326.5 1883.5
RoyaI Dutch SheII . .2269.0 29.0 2336.0 1890.5
SaIamander Energy .208.8 -1.2 317.6 182.3
Soco Internationa . . .315.9 7.7 400.0 279.8
TuIIow OiI . . . . . . . . .1368.0 31.0 1493.0 945.5
Amec . . . . . . . . . . . . .934.0 32.5 1251.0 740.5
Hunting . . . . . . . . . . .663.5 9.5 817.0 530.0
Kentz Corporation . .476.5 28.0 508.0 275.5
LampreII . . . . . . . . . . .254.0 7.4 395.2 220.7
Petrofac Ltd. . . . . . .1430.0 26.0 1685.0 1108.0
Wood Group (John) .646.5 21.0 715.8 469.0
Burberry Group. . . .1377.0 -14.0 1600.0 996.0
PZ Cussons. . . . . . . .372.1 1.3 409.0 320.5
Supergroup . . . . . . . .674.0 1.0 1820.0 591.0
AstraZeneca . . . . . .2909.5 66.5 3194.0 2543.5
BTG . . . . . . . . . . . . . .293.0 13.0 309.7 210.1
Genus. . . . . . . . . . . .1000.0 5.0 1111.0 800.0
GIaxoSmithKIine. . .1395.5 15.5 1400.5 1127.5
Hikma Pharmaceuti .656.5 26.5 900.0 555.5
Shire PIc. . . . . . . . . .2019.0 24.0 2136.0 1481.0
CapitaI & Countie . . .179.0 3.4 203.7 142.5
Daejan HoIdings . . .2670.0 70.0 2954.0 2282.0
F&C CommerciaI Pr .103.8 1.1 108.0 88.0
Grainger . . . . . . . . . . . .95.5 2.7 133.2 77.3
London & Stamford .115.0 0.5 140.0 111.6
SaviIIs. . . . . . . . . . . . .302.6 0.6 427.1 256.2
UK CommerciaI Pro . .76.0 1.0 85.5 70.4
Unite Group. . . . . . . .168.4 0.3 224.1 152.9
Big YeIIow Group . . .265.7 1.7 352.2 234.2
British Land Co. . . . .511.0 19.9 629.5 452.0
CapitaI Shopping . . .317.3 7.1 424.8 296.4
Derwent London . . .1673.0 12.0 1880.0 1400.0
Great PortIand Es . . .364.5 8.8 445.0 317.4
Hammerson. . . . . . . .399.8 9.1 490.9 353.0
Hansteen HoIdings. . .77.0 0.0 89.5 70.0
Land Securities G. . .694.5 21.5 885.0 616.0
SEGRO. . . . . . . . . . . .237.7 6.0 331.3 210.1
Shaftesbury. . . . . . . .508.5 5.5 539.0 431.7
Aveva Group . . . . . .1634.0 22.0 1799.0 1298.0
Computacenter . . . . .375.0 -4.4 490.0 354.8
Fidessa Group. . . . .1666.0 17.0 2109.0 1409.0
Invensys. . . . . . . . . . .218.2 7.3 364.3 199.6
Logica . . . . . . . . . . . . .80.2 3.2 147.2 73.9
Micro Focus Inter . . .354.5 4.9 426.2 239.4
Misys . . . . . . . . . . . . .290.6 10.7 420.2 214.9
Sage Group . . . . . . . .281.0 4.9 302.0 231.7
SDL. . . . . . . . . . . . . . .630.0 6.0 711.5 555.0
TeIecity Group. . . . . .620.5 11.5 625.0 430.0
Aggreko . . . . . . . . . .1807.0 35.0 2034.0 1394.5
Ashtead Group . . . . .170.0 5.0 207.9 99.4
Atkins (WS) . . . . . . . .533.0 12.0 820.0 490.2
Babcock Internati . . .697.0 13.5 733.0 513.5
Berendsen . . . . . . . . .436.9 0.9 568.0 391.3
BunzI . . . . . . . . . . . . .807.5 24.5 820.5 676.5
Cape . . . . . . . . . . . . . .347.9 3.5 591.5 328.0
Capita Group. . . . . . .661.0 2.0 786.5 635.5
CariIIion . . . . . . . . . . .322.5 4.4 403.2 298.8
De La Rue . . . . . . . . .914.0 35.5 915.0 549.5
DipIoma . . . . . . . . . . .318.0 -2.6 414.3 263.3
EIectrocomponents .208.4 5.3 294.9 182.2
Experian. . . . . . . . . . .829.5 3.5 833.5 665.0
FiItrona PLC . . . . . . . .385.0 -3.0 397.1 227.5
G4S. . . . . . . . . . . . . . .250.4 5.5 291.0 219.9
Hays . . . . . . . . . . . . . . .75.4 2.9 133.6 66.6
Homeserve . . . . . . . .267.1 11.1 532.0 218.5
Howden Joinery Gr. .110.4 1.3 127.5 90.0
Interserve. . . . . . . . . .321.0 3.4 341.3 183.5
Intertek Group. . . . .1921.0 53.0 2148.0 1715.0
MichaeI Page Inte . . .370.8 13.2 567.0 338.7
Mitie Group . . . . . . . .248.5 -0.5 257.5 194.1
Premier FarneII . . . . .172.2 7.9 308.8 144.5
Regus. . . . . . . . . . . . . .85.0 0.9 119.0 64.0
RentokiI InitiaI . . . . . . .67.0 0.6 104.9 64.8
RPS Group. . . . . . . . .183.0 2.7 253.0 156.6
Serco Group . . . . . . .500.0 -2.5 618.5 490.9
Shanks Group . . . . . .115.0 1.0 130.9 103.0
SIG . . . . . . . . . . . . . . . .92.5 -0.2 153.5 83.8
SThree . . . . . . . . . . . .230.0 5.2 447.6 213.2
Travis Perkins . . . . . .857.0 30.5 1127.0 715.0
WoIseIey . . . . . . . . .1883.0 39.0 2261.0 1404.0
ARM HoIdings . . . . . .634.5 10.5 651.0 350.6
CSR . . . . . . . . . . . . . .186.2 11.2 447.0 170.9
Imagination Techn . .477.7 14.5 502.0 296.9
Pace . . . . . . . . . . . . . . .64.6 4.4 231.8 60.3
Spirent Communica .126.2 2.7 160.3 109.5
British American . .2927.5 27.0 2949.0 2282.5
ImperiaI Tobacco . .2345.0 38.0 2352.0 1784.0
Betfair Group. . . . . . .758.0 -5.5 1490.0 567.0
Bwin.party Digita . . .125.8 1.2 257.6 100.6
CarnivaI . . . . . . . . . .2186.0 40.0 3153.0 1742.0
Compass Group . . . .568.0 13.5 612.0 512.5
Domino's Pizza UK. .441.5 1.4 586.0 377.0
easyJet. . . . . . . . . . . .355.4 13.9 474.0 301.0
FirstGroup . . . . . . . . .345.3 8.4 412.6 301.8
Go-Ahead Group. . .1314.0 0.0 1598.0 1203.0
Greene King . . . . . . .452.1 10.2 518.0 410.0
InterContinentaI . . .1088.0 25.0 1435.0 955.0
InternationaI Con . . .148.7 7.0 305.0 141.6
JD Wetherspoon. . . .430.0 3.5 468.3 380.5
Ladbrokes . . . . . . . . .136.6 2.6 155.3 114.0
Marston's. . . . . . . . . . .93.9 1.6 117.1 84.6
MiIIennium& Copt . .403.7 4.8 600.5 375.6
MitcheIIs & ButIe. . . .227.2 6.6 361.0 216.4
NationaI Express . . .224.3 5.2 270.2 218.3
Rank Group . . . . . . . .150.0 0.0 154.1 109.5
Restaurant Group. . .291.0 8.1 335.0 254.9
Stagecoach Group . .251.8 5.6 272.4 200.0
Thomas Cook Group .44.5 1.9 204.8 33.7
TUI TraveI. . . . . . . . . .163.1 7.1 271.9 137.2
Whitbread . . . . . . . .1645.0 34.0 1887.0 1409.0
WiIIiamHiII. . . . . . . . .213.0 0.1 244.1 155.5
Abcam . . . . . . . . . . . .359.8 4.8 460.0 307.0
AIbemarIe & Bond . .318.9 -12.1 400.1 272.0
Amerisur Resource . .13.0 0.0 29.0 9.5
Andor TechnoIogy . .495.0 0.0 685.0 370.0
ArchipeIago Resou. . .65.1 0.0 79.0 40.8
ASOS . . . . . . . . . . . .1456.0 16.0 2468.0 1234.0
AureIian OiI & Ga . . . .24.5 0.5 92.0 16.0
Avanti Communicat .296.8 3.3 735.0 248.5
Avocet Mining . . . . . .237.0 3.5 286.8 177.5
BIinkx . . . . . . . . . . . . .114.5 -7.5 158.0 70.5
Borders & Souther . . .65.5 2.5 72.3 43.5
BowLeven . . . . . . . . .101.0 4.5 398.0 74.5
Brooks MacdonaId 1257.5 0.0 1372.5 940.0
Cove Energy . . . . . . . .87.5 2.5 112.8 61.0
Daisy Group . . . . . . . .98.5 -0.5 127.0 88.0
EMIS Group . . . . . . . .472.5 -17.5 580.0 406.0
Encore OiI . . . . . . . . . .75.3 1.3 151.5 40.8
Faroe PetroIeum. . . .155.0 3.5 218.3 130.0
GuIfsands PetroIe. . .188.3 1.5 401.5 142.5
GWPharmaceuticaI . .91.0 -0.5 130.0 87.0
H&T Group. . . . . . . . .320.0 8.0 395.0 277.0
Hamworthy . . . . . . . .669.0 34.0 705.0 373.8
Hargreaves Servic .1138.0 4.0 1180.0 685.0
HeaIthcare Locums . . . .3.8 -0.3 4.2 3.8
Immunodiagnostic . .880.0 0.0 1218.0 768.5
ImpeIIamGroup . . . .267.6 -0.1 387.5 180.5
James HaIstead. . . . .455.6 -12.9 495.0 357.5
KaIahari MineraIs . . .224.3 -0.5 301.0 186.8
London Mining . . . . .305.0 1.8 436.5 283.0
Lupus CapitaI . . . . . .103.5 3.5 150.0 86.0
M. P. Evans Group . .390.0 -2.0 500.5 371.0
Majestic Wine . . . . . .416.0 -0.5 510.0 355.0
May Gurney Integr . .291.3 -4.8 302.0 211.0
Monitise . . . . . . . . . . . .38.3 1.8 40.0 18.5
MuIberry Group. . . .1532.0 12.0 1920.0 535.0
Nanoco Group. . . . . . .50.0 4.0 114.3 38.0
NauticaI PetroIeu . . .278.0 11.3 547.0 223.5
NichoIs. . . . . . . . . . . .532.5 6.5 579.0 410.0
Numis Corporation. . .91.5 0.0 137.8 89.0
Pan African Resou . . .14.0 0.0 14.5 9.5
Patagonia GoId . . . . . .56.0 3.3 70.0 28.0
Prezzo . . . . . . . . . . . . .57.0 0.0 71.5 53.3
Pursuit Dynamics . . .194.0 6.3 700.0 160.5
Rockhopper ExpIor .254.5 10.5 386.0 141.0
RWS HoIdings. . . . . .427.3 16.5 479.8 266.5
Songbird Estates . . .116.3 1.3 160.3 110.3
VaIiant PetroIeum . . .420.5 -13.8 672.0 420.5
Young & Co's Brew. .637.5 0.0 712.0 542.5
PremierFoods........6.4 40.3
Afren ..............85.8 14.6
Spectris ..........1336.0 8.7
Pace ...............64.6 7.2
Schroders ........1393.0 6.8
RoyaIBankofScot ...22.5 6.4
CSR ..............186.2 6.4
KentzCorporation ..476.5 6.2
LIoydsBankingGro ..28.8 6.1
NewWorIdResource 474.5 5.5
KierGroup........1414.0 -2.4
PerformGroup .....197.0 -1.6
DuneImGroup......498.0 -1.6
BovisHomesGroup .451.0 -1.6
Computacenter .....375.0 -1.2
BurberryGroup....1377.0 -1.0
BGGroup.........1366.0 -1.0
TeIecomPIus.......714.0 -1.0
Carpetright ........450.0 -0.9
ProvidentFinancia .1036.0 -0.9
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Tsy 3.250 11. . . . .100.04 -0.16 102.8 100.0
Tsy 9.000 12 . . . .106.17 0.00 113.8 105.8
Tsy 5.000 12 . . . .101.39 -0.07 105.6 101.3
Tsy 5.250 12 . . . .102.64 -0.05 106.9 102.6
Tsy 4.500 13 . . . .105.17 -0.08 108.1 105.2
Tsy 2.500 13 . . . .284.72 -0.05 287.7 277.6
Tsy 8.000 13. . . . .113.78 -0.11 119.5 113.7
Tsy 5.000 14. . . . .112.03 -0.10 112.9 109.2
Tsy 4.750 15. . . . .114.36 -0.22 115.8 108.6
Tsy 8.000 15 . . . .127.96 -0.25 129.2 123.7
Tsy 7.750 15 . . . .100.75 -0.71 108.2 100.8
Tsy 4.000 16. . . . .113.17 -0.32 113.5 104.9
Tsy 2.500 16 . . . .342.05 -0.26 343.1 310.2
Tsy 8.750 17 . . . .139.99 -0.75 141.9 132.9
Tsy 12.000 17 . . .123.49 0.00 132.5 122.5
Tsy 1.250 17. . . . .115.03 -0.37 115.8 106.7
Tsy 5.000 18 . . . .120.59 -0.50 121.2 109.7
Tsy 4.500 19. . . . .118.51 -0.60 119.3 105.4
Tsy 3.750 19. . . . .113.14 -0.65 113.9 99.4
Tsy 2.500 20 . . . .357.92 -0.51 359.9 312.4
Tsy 4.750 20 . . . .120.83 -0.66 121.7 106.6
Tsy 8.000 21 . . . .149.52 -0.75 151.8 133.8
Tsy 1.875 22 . . . .124.20 -0.68 125.4 111.3
Tsy 4.000 22. . . . .115.20 -0.84 116.3 99.0
Tsy 2.500 24 . . . .318.32 -0.75 320.9 273.5
Tsy 5.000 25 . . . .126.75 -0.93 128.1 107.4
Tsy 4.250 27. . . . .118.21 -1.07 119.4 97.9
Tsy 1.250 27. . . . .119.33 -1.00 121.0 104.6
Tsy 6.000 28 . . . .142.73 -1.05 144.1 119.5
Tsy 4.750 30 . . . .125.64 -1.12 126.9 103.0
Tsy 4.125 30 . . . .305.08 -0.91 307.5 261.2
Tsy 4.250 32. . . . .118.04 -1.20 119.3 96.0
Tsy 4.250 36. . . . .118.21 -1.29 119.5 95.0
Tsy 4.750 38 . . . .127.71 -1.36 129.3 102.8
Tsy 4.500 42 . . . .124.24 -1.41 125.9 98.9
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AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
No. 2 / Nov 11
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ASSET FINANCE
NO. 2 / NOV. 11
Looking ahead: Kate Sharp, CEO of the ABFA, discusses the future
of business lending and how important it is to the UK economy
ENCOURAGING
FUTURE GROWTH
Challenge the
misconceptions
Understand the
reality of asset-
based nance
Its your choice
Know the
options
available to you
Use your assets
Unlock the
potential value
of your assets
Whats in store
for 2012?
An insight into
the future of
asset nance
MAKING IT WORK
FOR YOU
STEPS TO
5
2 NOVEMBER 2011 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
F
ollowing the reces-
sion the business lend-
ing landscape has been
criticised, particularly
by SMEs, and with in-
creasing fears of a dou-
ble dip recession. Fol-
lowing the implementation of the
Basel III agreement on bank capital
adequacy and liquidity, the lending
climate looks set to continue to be
challenging. However, with the as-
set-based nance industry contin-
uing to grow and lend during 2011
there is a major alternative to tradi-
tional loans or overdraft facilities.
Recovery and growth
1
Our latest gures (the Asset
Based Finance Association,AB-
FA,second quarter 2011) show a fth
consecutive quarter of growth with
total advances from members up 12
per cent year on year - the rst dou-
ble digit growth since the recovery.
The gures also show excess avail-
ability with total available funds
last quarter at 22.2billion,
6.5billion of which was available
but not actually drawn by clients.
Its not uncommon for the asset
based finance industry to see growth
during periods of economic stress.
A similar growth pattern was seen
during the previous UK recession,
when the industrygrowth averaged 24
per cent per annum during 1989 to 1991.
This unusual capacity to per-
form well while the wider market is
struggling ofers banks and the wid-
er lending market a huge opportu-
nity to increase the levels of liquid-
ity they can ofer businesses across
a number of sectors.This distinctive
capability and opportunity is largely
due to a unique coupling ofered by
asset-based nance solutions; the
ability to ofer clients greater levels
of nance while at the same time re-
ducing the risk for lenders.
The sector of choice?
2
The types of companies turning
to asset-based nance are be-
coming more varied, a trend that
should continue as businesses and
lenders increasingly appreciate its
two-way appeal.There is also a grow-
ing understanding and appreciation
of asset-based structures among larg-
er companies looking at acquisitions
and MBO/MBI situations. Equity -
nance houses are also beginning to
turn to asset-based lenders more reg-
ularly as preferred funding partners.
It is also important that the indus-
try continues to educate the lend-
ing community on the wide range of
benets and choice available within
the asset-based nance sector.There
are a range of products on ofer de-
signed for diferent markets and sizes
of business which ofer diverse bene-
ts. However, all are based on allow-
ing the user to release cash tied up in
assets such as unpaid invoices.
This Mediaplanet supplement
shows just how important the sec-
tor is to the UKs economy,by provid-
ing not only vital nance but much
valued business expertise to the
countrys SMEs and larger compa-
nies. It looks at the three types of -
nance available under the wider as-
set-based nance banner (factoring,
invoice discounting and asset based
lending),the advantages of the solu-
tions and the future of the industry.
Campaigning for change
3
The ABFA takes very seriously
the responsibility to keep funds
from its members owing,to benet
SMEs and the wider economy.To sup-
port this objective, we undertake a
variety of lobbying initiatives. Most
recently we have been working with
the Finance and Leasing Association
(FLA) to examine the issues afecting
CHALLENGES
A key alternative to
traditional lending
The economic outlook remains gloomy, but SMEs struggling to nd nance through
conventional funding have a real choice elsewhere. Asset-based nance, along with
leasing and hire purchase, is booming. But what should you look for and why?
It enables us
to maintain
pace and our
sponsors to
meet their
cashow targets
Richard Noble
Intrepid driver
and director of
SSC Programme
Ltd discusses his
experience using
asset nance
WE RECOMMEND
PAGE 5
ASSET FINANCE, 2ND EDITION
NOVEMBER 2011
Managing Director:
Christopher Emberson
Editorial Manager: Faye Godfrey
Business Development Manager:
Dominic Webber
Responsible for this issue:
Project Manager: Talia Levine
Phone: 020 7665 4401
E-mail: talia.levine@mediaplanet.com
Distributed with: City AM
Mediaplanet contact information:
Phone: 020 7665 4400
Fax: 020 7665 4419
E-mail: info.uk@mediaplanet.com
With thanks to:
We make our readers succeed!
Mediaplanets business is to create
new customers for our advertisers by pro-
viding readers with high-quality editorial
content that motivates them to act.
SMEs when raising finance. We
hosted breakfast sessions at each of
this years political party conferenc-
es,bringing together SMEs,funders,
politicians and top business journal-
ists to discuss potential barriers to
funding and how they can be over-
come.We will continue to communi-
cate the ndings to Parliament so
that changes in legislation, for in-
stance the ban on assignment of
debts, can help the industry to sup-
port SMEs and make it easier for
them to use invoice nance.
As more and more markets become
aware of the benets of asset-based -
nance we can expect to see increased
visibility and usage of the products.
Although well established in the UK,
the asset-based nance industry is
still in its early stages of develop-
ment compared to most other forms
of business lending,which is why it is
so important we continue to educate
potential end users of the many ben-
ets of asset-based nance.
Kate Sharp
CEO, ABFA
Feslruclurhg ahd Fecovery
Fea peope, rea soulohs
www.bakertilly.co.uk
Tel. 44 (0)20 3201 8000
E. steve.merchant_bakertilly.cc.uk
Steve Merchant
Head cf /sset Based Lending Services
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Asset-based finance, the
means by which companies
can raise funds based on as-
sets such as their invoice
book,is one of the best ways of
raising capital in these belea-
guered economic times. But a
series of misconceptions still
linger in the market, mean-
ing many companies are los-
ing out on the chance to bor-
row more cheaply than they
could through an overdraft or
loan, and from lenders other
than their own bank.
Myth 1: Its expensive
There are three major mis-
conceptions, says Kate Sharp,
Chief Executive of the Asset
Based Finance Association
(ABFA). The rst is that peo-
ple think its expensive. They
are comparing an overdraft
facility to a serviced, sales-re-
lated instrument and they as-
sume the latter will cost more.
But there is no real compari-
son between the two. Compa-
nies need to decide what lev-
el of service they require, and
CHALLENGE THE
MISCONCEPTIONS
Question: O Can asset
nance provide the ideal
funding solution for SMEs?
Answer: O Yes, but
there are still widespread
misconceptions about how
it works
NEWS
CONSIDER
ASSET FINANCE
AS A VIABLE
OPTION
1
STEP
VIRGINIA BLACKBURN
info.uk@mediaplanet.com
AN0TREP D0NE DEAL:
D0NE DEAL
8,500,000
lssel Bosed Lending
lcquisilion
Moleriols
Hondling
D0NE DEAL
3,100,000
lssel Bosed Lending
Re-finonce
Monufoclure of
Telecoms 0obles
D0NE DEAL
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lssel Bosed Lending
Re-finonce
Business Process
0ulsourcing
MPG MoneyPIus Grou
D0NE DEAL
10,000,000
lssel Bosed Lending
New Working 0opilol Focilily
Debl Monogemenl
Services
D0NE DEAL
10,500,000
lssel Bosed Lending
New Working 0opilol Focilily
Debl ldvisory
Services
D0NE DEAL
UndiscIcsed
lssel Bosed Lending
Re-finonce
T Services &
Resource Monogemenl
Companies
are worried that
the market will
consider them to
be weak if they
use asset-based
nance
Kate Sharp,
Chief Executive,
ABFA
how much they are saving
by not having to chase their
own invoices. Costs can ac-
tually be very low: a basic in-
voice discounting facility can
cost as little as 0.2 per cent of
turnover. For a full debt re-
covery service,it might go up
to about 3 per cent.
Myth 2: Its seen as a
sign of weakness
The second misconception
is that even now, asset-based
nance is associated with
companies which do not
have a strong balance sheet
and would nd it dif cult to
raise funds elsewhere. Com-
panies are worried that the
market will consider them
to be weak if they use asset-
based nance, but there are
many rms that use it that
are household names, says
Sharp. This is a problem that
can only improve with time,
although in some ways the
dire economic outlook of the
last few years has actually
helped. Companies which
have a perfectly strong bal-
ance sheet, but which have
been unable to raise funds
through traditional sources
of lending have discovered
that asset nance has been
the answer.
Myth 3: You will lose all
control
Sharp believes the third mis-
conception is about loss of
control. But that is not the
case, she says. If a company
wants a full factoring service
and someone else to collect
payments, they can hand over
all responsibility. But equally
anyone can do their own debt
chasing and just use the fund-
ing option. And if they do use
the full service, the provider
will be very professional when
chasing payments and wont
ruin a long-term relationship
with a client.You can even ask
them to chase one set of cli-
ents rst and hold of on an-
other anyone can ask for a
bespoke service.
Looking ahead to a
positive future
Despite these misconcep-
tions,business is booming.Ac-
cording to the most recent AB-
FA statistics, released in June,
there had been ve consecu-
tive quarters of a growth in
advances,reaching 12 per cent
in June 2011, with a net gain
of 244 clients. Asset-based -
nance is nally coming into
its own.
NOVEMBER 2011 5 AN INDEPENDENT SUPPLEMENT BY MEDIAPLANET
Richard is now working on
even more ambitious car
design, the Bloodhound
SSC, capable of 1,000 miles
per hour. Financing has
been helped by finance bro-
ker Hilton-Baird. We are
building the car now: and
we are going to roll it out in
December 2012 for opera-
tions in South Africa in 2013
and 2014, says Noble.
Large investments
A project like this can be
extremely difficult to fi-
nance. Noble states he
has spent 5.4 million to
date, with another 4 mil-
lion needed to complete
the build, and operational
costs to come later. He be-
lieves the total figure will
be between 16 million and
20 million.
Raising money
We get the majority of our
funding from sponsorship
and public donation, but it
has never been predicta-
ble,and we have to meet our
production targets, says
Noble. It is almost impos-
sible to raise money from
conventional sources such
as venture capital, because
not only is it dif cult to pre-
dict the operating costs of
this very high performance
research vehicle but also
we have to innovate at eve-
ry stage to meet market and
technical requirements.
We would of course be glad
of government support but
that might slow matters
due to risk aversion.
Cash flow solutions
With the research behind
them and 200 companies
on the programme the rst
main sponsors are coming
aboard,and the company was
proud to welcome Rolex ear-
lier this year. During the re-
search phase we were glad of
the help from Hilton-Baird
who arranged a factoring fa-
cility to advance 120,000, in
this case factoring a spon-
sorship. It worked very well
and we will probably use it
again, says Noble.Our costs
are now accelerating towards
260,000 a month and if an-
other shortfall arises, it is an
ideal solution because it ena-
bles us to maintain pace and
our sponsors to meet their
cashow targets.
Ambitious
entrepreneur uses
asset nance to
break world records
VIRGINIA BLACKBURN
Intrepid driver and
entrepreneur Richard
Noble not only held
the world land speed
record between 1983
and 1997, but was also
the director of SSC
Programme Ltd. This is
the company that built
ThrustSSC, the British
vehicle that holds
the current and first
supersonic world land
speed record set
in 1997.
SHOWCASE
THE NEED FOR SPEED
Richard Noble used asset
finance to fund his record-
breaking ventures
PHOTO: PROVIDED BY HILTON BAIRD
Wbenever ycu want tc get a deaI dcne, ccntact PNC Business Credit:
Russell 0illing O717 8O3727 l Korl Holmes O778 O227
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bosed lending orm of PN0 Bonk, Nolionol lssociolion, o wholly-owned subsidiory of PN0 ond Member FD0.
Lending producls ond services require credil opprovol. 0FN-3/2/ 2O1O The PN0 Finonciol Services 0roup, nc.
lll righls reserved. Member FD0 for the ACRIEEP in us all
Richard Noble,
Director,
SSC Programme Ltd
The futures
bright for
asset-based
lending
Difficult economic
conditions have had an
effect of the asset-based
lending market, but the
picture is getting rosier.
According to ABFAs most re-
cent Economic Report, asset-
based nance is very much in
demand. In the second quar-
ter of 2011, increases from ABFA
members reached 15.7 billion,a
12 per cent increase on the pre-
vious 12 months.Total approved
nance stood at 22.2 billion -
nance, with a further 6.5 bil-
lion available for funding, mak-
ing this a valuable resource for
companies starved of cash.
And this is a resource to fit
all books. Clients with an an-
nual turnover of more than
100 million received a quar-
ter of the industrys advances,
while SMEs received about 40
per cent. Just over half of the
industrys clients are small
businesses with a turnover of
less than 1 million, and a fur-
ther 41 per cent are medium
sized, with turnover less than
10 million. Growth in advanc-
es was greater for the largest
clients in 2010; however, in the
last quarter the gap between
the giants and the SMEs began
to close, suggesting SMEs are
feeling more confident.
VIRGINIA BLACKBURN
Use your assets to the
best of your advantage
Unlocking the value of your as-
sets is one of the best ways to
raise money in these troubled
economic times and asset-based
finance is one side of that equa-
tion.On the other,though,is mak-
ing use of physical assets, such as
your equipment, machinery, car
fleet and so on. It is either practi-
cable to buy these items without
using up cash, or alternatively, if
you already own them, they can
still be put to good use.
There are three principle
product types, says George Ash-
worth, the Head of Asset Finance
at Aldemore and a Board Director
at the Finance and Leasing Asso-
ciation (FLA). There is leasing
in the form of a finance lease or
an operating lease, hire purchase
(HP) and a loan, although the last
of these plays a very small part in
asset finance.
Know the difference
The two main types of financing,
HP and leasing, are slightly dif-
ferent. Under an HP agreement,
the customer will purchase the
equipment and nance the pur-
chase with an HP contract. They
will pay a deposit and nance the
balance over a xed period, usu-
ally ve years, although it can be
longer, Ashworth says. With HP,
the customer has the economic
and tax ownership from day one,
so can claim the relevant allow-
ances, pay VAT on the supply of
goods and services and then claim
it back. When the agreement
comes to maturity, he will pay for
the option to purchase it, usually
a nominal amount to ensure the
title passes to the customer.
Leasing can be split into two
categories, finance leases and
operating leases. In the case of
the former, the lessor will claim
all benefits relating to the asset
in question and pass these on to
the lessee in the form of reduced
rentals; the lessor will also recov-
er 100 per cent of the assets, says
Ashworth. Leasing qualifies as a
taxable supply under VAT regu-
lations; the lessee will therefore
pay VAT on rentals as they fall
due, which means that unlike
under HP, the cost of the VAT will
be spread. Under an operating
lease, the lessor does not recov-
er 100 per cent, but looks to the
asset for its resale value, so tak-
ing on the residual value risk.
The customer gets the same
use and possession, but gener-
ally pays less. A loan is a loan,
normally unsecured.
Understand the advantages
The benefit to the customer or
lessee, is that both HP contracts
and leases are generally medi-
um-term schemes and once the
terms have been agreed and eve-
ryone locked in, the facility can-
not be withdrawn (unlike an
overdraft). Secondly, because the
agreement is based on an under-
lying asset, lenders do not ask for
more security, such as the fam-
ily home. They offer incremen-
tal lines of credit in addition to
conventional lending, customers
can use them to increase their li-
quidity without turning to their
own bank, and they are quick and
easy to arrange, often by the sup-
plier of the equipment.
Of course, by their very nature,
all types of this kind of finance
also help spread the cost of an as-
set. Nothing is paid for upfront.
VIRGINIA BLACKBURN
Question: O How can you
raise money in todays unstable
economic environment?
Answer: O Using asset-based
nance and making the most of
your physical assets
SMART THINKING
Electric cars can be
cost effective for those
people making short
journeys or for pool cars.
Green leasing can help
companies spread costs
and reap the tax benefits.
PHOTO: SHUTTERSTOCK
NEWS
SHOWCASE
KNOW YOUR
ASSETS WORTH
2
STEP
QUESTION & ANSWER
What is green leasing? O
!
For the car industry,it is a way
of making green technology
more afordable and using leasing
as a method of acquiring the use of
green assets, which would other-
wise be very expensive.
What are the ultimate O
cost savings if you use
environmentally friendly cars?
!
Electric vehicles are 40 to
50 per cent more expensive
than their petrol or diesel equiv-
alents in terms of their capital
costs, but the savings come in
terms of dramatically reduced
costs of fuel as electricity is
practically free.Diesel now costs
1.45 a litre,meaning it costs 16p
to 18p per mile to drive these ve-
hicles, whereas electricity is in
the decimal percentage points
of a penny.
What are the benefits? O
!
Cost savings. There are ei-
ther tax-based benets for
the end users,who can claim 100
per cent tax benets at the end
of the rst year, or savings to be
made by the corporation by leas-
ing vehicles instead of buying
them outright.
Are electric vehicles O
suitable for everyone?
!
No they would not be
suitable for a whole eet of
cars or for people who have to
drive long distances. They are
best for people who make short
commutes, or for pool cars.
Many big accountancy firms
now have a pool of electric cars,
which they nd better than tax-
is and more cost efective.
Are there other benefits O
involving electric cars?
Yes. In the future, publicly
quoted organisations will
have to put their carbon foot-
print in their annual report and
so they are seeking to reduce
that footprint in every way they
practically can. Green leasing is
an efective way of helping them
to do that.
Why dont more companies O
use them?
Because it is inherently
more expensive, compa-
nies can be reluctant to pay a pre-
mium upfront. But green leasing
helps them spread the cost and
reap the tax benets.
John Lewis
Chief Executive,
BVRLA
George Ashworth
Head of Asset Finance, Aldemore
and Board Director, FLA
FACTS
Asset finance O accounts for 25
per cent of all xed capital invest-
ment (excluding property).
In 2010 O , asset nance lenders
lent 20.3 billion to businesses.
750,000 small O businesses
currently rely on asset nance.
More than O 1,000 UK busi-
nesses enter into a new asset -
nance contract every day.
75 million O was lent in
equipment nance each work-
ing day in the second quarter
of 2011, estimated half of this to
SMEs; 4.86billion overall lent
to companies to invest in equip-
ment (excluding deals of over
20million).
Lending for O businesses to
buy and lease cars in the sec-
ond quarter is at its highest since
September 2008.
SOURCE: FLA
!
!
Flexible Funding Solutions

There are other
options to an overdraft
For more information on exible funding solutions by
Members of the Asset Based Finance Association visit
www.abfa.org.uk/public/industryInformation.asp
Release more cashow than with a traditional
loan with invoice nance.
CL Cop|to|
ve be||eve thot prov|d|ng to||ored equ|pment |nonce ocross o
vor|ety o |ndustr|es works to bu||d more susto|nob|e bus|nesses
ond heo|th|er econom|es oround the g|obe. ve hove l30+ yeors o
|ndustr|o| exper|ence g|v|ng us o un|que |ns|ght |nto the cho||enges
oc|ng bus|nesses every doy ocross o w|de ronge o sectors.
Comb|ne thot |ns|ght w|th the |nonc|o| ocumen ond osset
expert|se o our teoms ond you |nd on equ|pment |nonce
prov|der who reo||y understonds your bus|ness.
To see how CL Cop|to| con he|p w|th your |nonce requ|rements
emo|| us ot morket|ngteomge.com or v|s|t
www.gecop|to|.co.uk/equ|pment
Lqu|pment f|nonc|ng thot
stonds out rom the crowd
Last year Finance & Leasing Association

members provided more than 20 billion
to businesses and the public sector to
support capital investment, representing
about 22% of the UK total.
1 in 3 small businesses that have external
borrowing use asset nance.
1000 smaII business take up asset nance
every day.
Finance & Leasing Association members
help around 750,000 businesses to obtain
equipment through asset nance.
To nd out more about the Finance and
Leasing Association go to: www.a.org.uk
Fuelling the Economy
INSPIRATION
Asset nance aiding
the UK economy in
times of instability
THE CENTRAL HUB
The financial City of London
where many of the FTSE
100 are based. But an
entrepreneurial climate and
the growth of SMEs is needed
to build the UK economy
PHOTO: SHUTTERSTOCK
Britain needs new O
business: it is commonly
accepted that if Britain
is to emerge as a strong
economy once more, it needs
an entrepreneurial climate
in which to thrive. And the
businesses do not need to
be huge ones: it is estimated
that the combined worth of
Britains SMEs is 1.6 trillion,
more than the total of the
FTSE 100. But where is the
money to come from?
Offering leverage to
aid growth
The answer, in many cases, is as-
set finance, because cash can be
raised from the moment the first
invoice is levied, while the costs
of machinery and equipment can
be spread by using leasing or hire
purchase. And as the company
grows, so does the funding facil-
ity. If you are a growing compa-
ny, it will give you leverage and
grow with you, says Kate Sharp,
Chief Executive of the AssetBased
Finance Association. Every com-
pany has a period in which they
are waiting for invoices to be
paid: we fix that gap.You sign the
invoice and from day one, you get
the cash.
Less risk and more
flexibility
Equally its a good way to fund es-
sential equipment without pay-
ing cash upfront. As an addi-
tional, committed and flexible
source of funding it can be tai-
lored depending on the custom-
ers needs, says Alexander Bald-
ock, Managing Director of Lom-
bard. It allows you to pay for the
kit for its useful working life on-
ly and at the end of the contract
you can either return the kit or
extend the agreement. Asset fin-
anciers such as Lombard can take
the risk out of an assets worth at
the end of its working life.Agree-
ments are tailored in other ways
too for example, so that re-
payments only have to be made
when money is coming into the
business. In essence, it takes the
risk away from the business as
it no longer matters to the busi-
ness what something is worth at
the end of its working life. Asset
finance providers are also able to
do highly specialised work such
as in the technology industry
where technology has to be dis-
posed of according to legislative
requirements. We can do that for
our clients, too.
Improving cash flow
One problem that many compa-
nies suffer from, and which is a
particular problem for start-ups,
is late payments. Asset finance
can be used to bridge an awkward
period with little cash flow.
A recent survey by our sister
company,Hilton-Baird Collection
Services, found that 67 per cent of
firms reported an increase in late
payment over the six months to
July, says Evette Orams, Manag-
ing Director of Hilton-Baird Fi-
nancial Solutions. Perhaps of
greater concern is that the most
common reason cited among cul-
prits was that theyre waiting
to be paid by their own custom-
ers (33 per cent), illustrating the
knock-on effect
late payment can
have on businesses whose cash
reserves may not be sufficient to
absorb the shock. This is diffi-
cult enough for established com-
panies; all the more so for com-
panies with little accumulated in
the bank.
Safeguarding and
protecting
Asset-based finance, whilst in-
creasingly available according to
the latest figures from the Asset
Based Finance Association, as-
sists by releasing cash against in-
voices just 24 hours after they are
raised to remove the cash flow
gap associated with trading on
credit, says Evette. Crucially,
facilities can additionally, if re-
quired, incorporate a dedicated
sales ledger management serv-
ice, as well as bad debt protection
to safeguard the business cash
flow from late payment or pro-
tracted default.
VIRGINIA BLACKBURN
CHANGE
Steve Merchant
Head of asset-based services, Baker Tilly,
provides advice to borrowers looking to
raise funds from 100k to 30 million plus
Asset-based lending is one of the
best ways for new companies to
grow their business, but what
considerations should they bear
in mind when going down that
route? They should think of the
future not just where their busi-
ness is today, but where it will be
in one,two and three years time,
says Steve Merchant, Head of as-
set-based services at Baker Tilly.
What will their capital require-
ments be? They should choose
their lender carefully as there are
dozens of providers out there,and
consult with a trusted adviser.
Asset-based lending also pro-
vides a more ef cient manner
of controlling expenditure. The
cash generated from invoice -
nance is great to help a business
grow as it helps take on new cus-
tomers, allows for investment in
people and raises money to pur-
chase equipment, says Mer-
chant. Although a word of cau-
tion high standards of sales
ledger management need to be
maintained to fully gain the
benet from unlocking the cash
from unpaid invoices.
NEWS IN BRIEF
VIRGINIA BLACKBURN
Aldermore is a bank which is bucking
the trend with its flexible and
commercial attitude to lending, offering
factoring, invoice discounting, as
weII as asset hnance and cemmerciaI
mortgages all wrapped-up into one
integrated package or alternatively,
taiIered hnanciaI cempenents Irem
the range, whatever best suits the
customers needs. It offers dynamic
and straightforward products with a
high IeveI eI service, with specihc cIient
liaison teams who work closely with the
SME on a daily basis, ensuring funding
facilities match clients requirements.
Some lenders are facing a conundrum.
The Government is putting pressure on
the larger banks to build their reserves
in case of future economic turmoil,
whilst encouraging them to lend more
money to small and medium businesses
(SMEs) in order to stimulate growth.
unquestlcnably, a dlffcult balanclng
act. But this double edged sword, is
maklng lt lncreaslngly dlffcult fcr SMFs
tc fnd fundlng and thls ls where a smaller
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As the economy continues to
struggle, we recognise business
owners are looking for straightforward
and dynamlc fnanclal prcducts whlch
will enable them to exploit business
opportunities. In a nutshell, Aldermore
is dedicated to helping SMEs across the
UK and has positive attitude to lending.
Ian Wilkins,
Group Managing Director of
Commercial Finance,
Aldermore
Responding to the needs of SMEs
Invoice finance allows customers
access to funds via the value of their
unpald lnvclces, whllst asset fnance
provides funding for businesses
looking to buy new equipment, plant,
vehicles etc. both these funding
facilities, enable SMEs improve
thelr cashfcw whlch nct cnly allcws
businesses to concentrate on their
core activities but removes the worry
of using precious capital which could
be used more effectively to grow and
develop their business.
Taking the opportunities
SMEs have to respond quickly to
market opportunities which mean
they alsc need thelr fnanclal partners
to respond equally as fast. Launching
only two years ago has meant that
Aldermore has no legacy issues, as
well as designing and embedding a
short decision-making process which
means that SMEs can be assured of
a prompt decision. As a new Bank,
Aldermore has also developed
technology to provide clients with
real-time information about their
current funding status which gives the
customer a full picture and complete
ccntrcl cver thelr fnances.
Recently, Aldermore announced it made
150 million of invoice funding available
to SMEs during September, an increase
of 42% over the same period last year
and client numbers also increased
by 19% over the past year. To put this
achievement into context, data released
by the Asset Based Finance Association
shows that total advances made by all
member frms grew by 12% durlng the
same period and there was no growth in
the total number of new clients.
Asset Finance has funded 155m of
business since the start of 2011 and
processing over 1,000 proposals per
month, a phenomenal success given that
its been operating for just over a year.
Aldermcre ls defnltely a bank whlch ls
saying yes, who is keen to continue
working closely with the SME sector,
as well as having the expertise and
fexlblllty tc prcvlde a ccmprehenslve
ccmmerclal fnance package.
Choosing the best route to aid
your business needs
There are many considerations
to be taken into account when
a company decides on the form
of borrowing it wants, and one
of the great advantages of asset-
based finance is its versatility.
Asset-based finance can be very
useful when a company wants to
refinance or restructure, says
Mike Symes, Managing Director
of specialist financial market-
ing agency Strand Financial. If a
company is not receiving enough
funding and support from its tra-
ditional lender, and it wants to fi-
nance growth and increase turn-
over, this can be a very attractive
product.
Understanding the options
Asset-based nance boils down to
three types of lending: invoice dis-
counting,factoring and full asset-
based lending. At its simplest, the
company sells its book of invoices
to a specialist nance house and
is paid, usually, about 80 to 85 per
cent of the amount outstanding,
minus the charges made by the
lender (at this level, usually a few
basis points.) When the invoice is
paid,the balance,minus the fee,is
due to the borrower.
Aiding considerable growth
Asset-based lending can fund far
more complex transactions, in-
cluding mergers and acquisitions
and management buy-outs. One
of the most fundamental things
about it is that it provides an im-
mediate injection of working
capital, says Symes. This can
be a considerable sum,which can
be used as a purchase considera-
tion in an M&A. There is also the
revolver element to it: as well as
the capital injection, it also sup-
plies continuous working capital
as the deal grows and develops.
This can provide vital headroom
in the first six months of a merg-
er when you need to have that
level of funding coming in.
According to Symes, this works
particularly well when a high
level of eligible receivables are
involved: Even the assets of the
company being acquired can be
taken into account, he said. The
lender builds a picture based on
the level of asset cover, which
can mean a higher level of debt
than you could have raised by a
loan. It provides more senior debt
than other facilities: because the
lender has more security, it can
lend more.
Staying in control
And then there are management
buy-outs. A lot of advisers sug-
gest this type of borrowing for
MBOs because it maintains own-
ership in the hands of the man-
agement team, says Symes. If
you went to a venture capital-
ist youd give away equity this
way you dont, and its also not as
exit-focused as a
venture capital deal
would be. It gives you
the valuable injec-
tion of working capi-
tal that you need in the
early stages of grow-
ing the business. Above
all, asset-based lend-
ing is not entirely de-
pendent on historical
company profitability.
Question: O
Can asset-based lending be
used to finance both simple
and complex requirements?
Answer: O
Yes, and it provides a degree
of flexibility other lending
does not
NEWS
SHOWCASE
KNOW YOUR
OPTIONS
4
STEP
There is O a continuing im-
provement in costs for large
and medium-sized business-
es, according to ABFAs recent
Economic Report. The effective
rate on new borrowing overall
remain unchanged.
In 2011, O Q2 fees and
spreads on loans to medium
and large firms have fallen,
while spreads for small busi-
ness remain unchanged.
Higher spreads O indicate in-
creased risk of lending as well
as the increased cost to lend-
ers, in particular the cost of
bank wholesale debt. The main
factors were investor concern
about sovereign debt in the euro
zone, uncertainty over proposed
regulatory changes in the UK,
and the bleak economic outlook.
SOURCE: ABFA
VIRGINIA BLACKBURN
FACTS
These are pretty uncertain times,
so the more working capital you
inject into a rm, the better, says
Mike Symes. ABL provides a form
of lending that doesnt dilute equity,
which is a major consideration for
companies right now. If a company
has had a difcult year but is asset
rich, ABL is less concerned at
historical trading performance, but
considers a whole mix of areas
including the management of the
business. Store is put on people
and plans, as well as asset cover.
And it is ideal for turnaround
situations. Nor is it an expensive
option, as it can provide signicantly
higher levels of nance for a
company at every level of growth.
Mike Symes, Managing Director, Strand Financial
Asset-based finance is now a ma-
jor player when companies of all
sizes wish to raise funds and un-
like most other types of lending,
it does not necessarily suffer at
times of economic unrest. We
believe there will continue to be
growth in the market as the prod-
uct has proven to be safer for lend-
ers, says Kate Sharp, Chief Exec-
utive of the Asset Based Finance
Association.In other areas,fund-
ing has become less available and
more expensive,and were not go-
ing back to a time of cheap cred-
it. But invoice finance is afforda-
ble,accessible and offers a unique
combination, as well as freeing
up more money for the borrower
it also provides the lender with
greater security.
One solution for all
John Bevan,Chairman of ABFA and
Head of Trade and Working Capi-
tal UK & Ireland at Barclays Corpo-
rate also believes there will be an
increase in the size of the market
and the products it ofers, as well
as becoming part of a standard
format all banks and advisers will
be ofering to clients. Clients no
longer want individual products
but solutions across the board, he
says.We are bringing all products
under one roof, so when we talk to
clients we can talk about an end-
to-end capital solution.
However, he also be-
lieves that there will
be increased leg-
islation across
the industry.
It will be open
to more scruti-
ny, something
that is hap-
pening across
the financial
markets as a
whole,
he says.The four high street banks,
through their subsidiaries, already
have threequarters of the ABFA
market share, and so there is al-
ready a high degree of FSA scrutiny.
But there will be more.
Current instability
On the other side of the coin,
many asset finance providers
believe that the banks will
come under more pressure.
It is important to appreci-
ate the fact that the major
providers are banks or bank-
owned institutions and
they are facing a
perfect storm,
says George
As hwo r t h,
Head of As-
set Finance
at Alder-
m o r e
and a
Board
Member of the Finance and Leas-
ing Association. There is the eu-
rozone crisis, the prospect of tak-
ing a haircut on sovereign debt,
the proposed splitting of bank
operations, Basle 3 compliance
pressure and increased consum-
er credit regulation. This is a wa-
tershed moment and some ca-
pacity will very likely leave the
industry. However, that means
there will be more opportunities
for newcomers. There will be an
asset finance industry for both
customers and lenders need it.
But the industry will end up fit-
ter and leaner than before.
Future predictions
Ashworth believes that hire pur-
chase will grow, possibly at the
expense of leasing. The jury is
out on leasing, he says. In 2012
there will be a restatement and
if the playing field remains the
same, and all leasing will be on
the balance sheet, I can see the
industry focusing on residual-
based products to differentiate
themselves from debt products.
But HP will continue to grow.
What does the future hold
for asset-based nance?
NEWS
VIRGINIA BLACKBURN
LOOK AHEAD
5
STEP
Basel makes /ssetBased Lending
first pcrt cf call fcr change finance
The asset-based |ending (ABL) market apart from a
modest dip during the credit crunch has been
growing strong|y for many years. The decade to 2008
saw a four-fo|d increase with new entrants emerging
and enhancements in the range of faci|ities provided.
Latest industry statistics from ABFA for 02 2011
confirm the market is growing at 10% per annum.
0cncerns arcund the fragility cf the eccncmic reccvery
are bcund tc affect banks' decisicns cn lending
requests. This is particularly the case fcr businesses
seeking new cr increased levels cf funding cr fcr thcse
gcing thrcugh significant change.
The /BL sectcr has never shied away frcm challenging
prcpcsiticns. With a mcre secure pcsiticn than cther
lending structures, the /BL industry ccntinues tc
demcnstrate a prcven track reccrd cf enthusiastically
suppcrting businesses gcing thrcugh change be it
develcpments in cwnership, grcwth cr turnarcund.
/ssetbased lenders (/BLs) have been rapidly
adjusting and, in additicn tc aggressively funding trade
receivables, have expanded their cffering tc fund cther
assets including inventcry, equipment and prcperty.
Scme prcvide cash flcw advances as part cf a
package fcr bcrrcwers with strcng financial
perfcrmance prcfiles.
mpcrtant regulatcry drivers make assetbased lending
mcre attractive fcr bcrrcwers and lenders. /s a
ccnsequence cf the capital adequacy requirements cf
the Basel and agreements, /BL is a lcw lcss
prcpcsiticn and therefcre 'light' in relaticn tc bank
capital it is ncw the 'first pcrt cf call' fcr banks and
bcrrcwers tc achieve flexible and ccst effective funding.
With the implicaticns cf Basel ccmbined with an
impressive level cf aggressicn being demcnstrated by
/BLs the sectcr lccks likely tc ccntinue delivering
dcubledigit grcwth. www.bakertilly.co.uk
|rr frrtlr irfrrnitirr, jlis rrrtirt:
!tt rrlirt
Bii rf ksst Bisi |riir !rtirs
I: 1l1 l1! !111
|: stt.nrrlirt@|i|rtill.rr.r|
Looking
further a eld
The latest ABFA economic report
also shows that export and import
factoring have both grown sub-
stantially, enjoying a year on year
rise in client sales of 48 per cent and
47 per cent respectively.This leap in
demand for cross-border factoring
indicates that while the UK econ-
omy may remain sluggish, clients
are looking to customers outside of
the UK to buy their products, and
are choosing this type of nance to
help facilitate overseas trade.
Credit protection payments by
ABFA members to their clients
have also continued to decline,
dropping by 27 per cent over the
last year to total 4.9m,consistent
with the UK-wide trend of lower
default rates on loans and a stable
rate of write ofs. Together with
the shortening average debtor
day numbers both these indica-
tors reect one of the key product
benets of asset-based nance,
namely introducing rmer debt-
or disciplines.
Kate Sharp, Chief Executive of
the Asset Based Finance Asso-
ciation, said: The gures in our
latest economic report indicate
growing business confidence
amongst invoice nance clients;
both SMEs and larger rms. This
contrasts markedly with the gen-
eral negative sentiment concern-
ing the state of the wider UK econ-
omy and a general contraction in
the stock of lending. Firms using
invoice nance are seeing rising
sales and are continuing to have
access to a stable and afordable
nance mechanism.
VIRGINIA BLACKBURN
John Bevan, Chairman of the ABFA and Head of Trade and Working
Capital, UK and Ireland at Barclays Corporate
Asset Finance
Investec has bui|t a reputation for itse|f within asset finance. Go|ng strong for more than
two decades, we`re vast|y exper|enced at creat|ng bespoke so|ut|ons for SMEs - rang|ng from
the most comp|ex f|nanc|ng cha||enge to the s|mp|est asset fund|ng. lnnovat|ve, we have a b|g
appet|te for approv|ng a|| sorts of dea|s and can g|ve you a dec|s|on qu|ck|y. So get |n touch
and rea||se your potent|a|.
Corporates & professiona|s contact our subs|d|ary |eased|rect F|nance |DF} on 01244 527 300
Brokers and intermediaries contact Mart|n Harr|es on 01235 555 577
Lenders and finance companies contact |ee Barns|ey on 0207 597 3682
www.investecassetfinance.com
/ |'. |e
. sse |..e
lnvestec Spec|a||st Bank |s a brand name of lnvestec Bank p|c, reg|stered address 2 Gresham Street, |ondon EO2v 7OP. lnvestec Bank p|c |s author|sed and regu|ated by the F|nanc|a| Serv|ces Author|ty.
PANEL OF EXPERTS
Alex Baldock
Managing Director
Lombard
Stephan Caron
Chief Commercial Director
GE Capital
Mike Francis
Head of Asset Finance
Investec
As an SME,do you have the appetite to acquire
the assets you need for your business to grow?
If you are looking to keep your cash free or un-
lock the value within an asset via a sale and
leaseback, asset nance could be the right op-
tion.Talk to your bank as they can guide you on
the various nancing options available to you
or your accountant. Lombard,which is part of
The Royal Bank of Scotland Group,is most cer-
tainly hungry for business: we are com-
mitted to lend more than 20 per cent
more in 2012 than we did in 2011,
and in 2011,we loaned 15 per cent
more than we did in 2010.
Overall we have seen business grow in the
year to August: weve provided 3 per cent
more funding than we did in 2010. In all, the
asset nance market is gaining a share of the
total market, not least because the industry
is focussing on raising awareness of asset -
nance.In August it was up 13 per cent year on
year compared with 2010. Were being more
successful in getting the word out. Many
manufacturers still do not know about asset
nance,but they are beginning to learn more
and customers are beginning to learn that we
are able to specially tailor funding solutions
for them as well.
The natural inclination of any company is
to go to their house bank for nance, which
will typically be a clearing bank. However, in-
dependent players are typically more ef cient
as they specialise and know the market better.
They are beginning to send out direct market-
ing, organise conferences and team up with
government and industry bodies to get them-
selves a bit better known. Customers could
Google to nd out whats on ofer. They could
talk to their accountant, who could refer
them to an advisory team that special-
ises in debt advice to SMEs. It is also
worth looking at government websites.
A lot of companies have not been growing.
We have seen deleveraging across the board.
However, there are opportunities in pockets
of industries that are cyclical, such as the au-
tomotive industry, packaging and commodi-
ties, all of whom would struggle to get hold of
any other form of nance. Historically, large
companies havent needed asset nance, but
these days, they need to renance and over-
drafts and loans have just dried up. Over 100
billion worth of debt needs to be renanced
over the next three to four years. Almost cer-
tainly,a lot of it will come from asset nance.
From a corporates perspective,they can nd as-
set nance through their main relationship bank
or other nance companies, who might market
them directly or through point of sale nance. The
latter is nance provided either by a manufactur-
er or retailer directly or through a nance broker.
Investec Asset Finance has historically targeted
the nance broker market,although it is now also
targeting direct nance to manufacturers and re-
tailers or to corporates. As a rule,IAF will only deal
with brokers who have a Consumer Credit Licence
and who are members of a trade body such as the
Finance and Leasing Association or the National
Assocation of Commercial Finance Brokers.
The market has been depressed recently:
some of the bigger banks have pulled back. We,
however, have doubled our business as this is a
good time to be a specialist. Generally, trading
conditions have been tough,although there has
been a change. In 2009, we saw a lot of corpo-
rations going into administration. These days,
businesses are managing to keep going, but its
tough and people are struggling. For the future,
if interest rates dont go up, there will be a pe-
riod of calm. The biggest risk to business right
now is a rise in interest rates.
Asset finance is a key source of
capital expenditure funding. Getting
British business the kit they need is the key to
getting Britain out of recession: it is not dis-
cretionary, but essential Britain needs to
keep its equipment current so that businesses
can be productive and competitive. Recently,
we have seen some businesses six years into a
four-year replacement cycle and since manu-
facturing still makes up 13 to 14 per cent of the
economy that is serious concern.Asset nance
allows businesses to invest in this essential kit
without having to pay cash upfront.
Asset finance is a very exible way of -
nancing a business. You can align the nanc-
ing with the growth of the business as lenders
advance nance against receivables. Cost wise,
its totally transparent as companies know ex-
actly what their costs will be, on top of which
its straightforward. You dont need to provide
a complicated set of nancials.As long as lend-
ers are comfortable with the underlying asset
they are asked to nance, there should be no
problem. It is a relatively straightforward ap-
plication process and much less cumbersome
than with other types of lending.
If a company has an overdraft facility,it can be
pulled or cut at a moments notice. If, however,
you nance your borrowing on a lease,provided
you pay the rent, its guaranteed. Cash is cur-
rently scarce and its dif cult to obtain liquid-
ity. This also gives access to more funders,thus
widening your sources. Another very important
element is that it is also a xed cost. If interest
rates go up as they are bound to eventually,your
costs wont. So it gives you security, a reduced
risk and you are able to plan your outgoings far
more ef ciently than you would have been able
to from any other form of funding.
Question 1:
How do you start the
process of nding
asset nance?
Question 2:
What are the key
benets of asset
nance?
Question 3:
What has the asset
nance market been
like recently?
Ask the
experts!
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I
n the current climate, the mantra that cashow is king has never been more important to businesses
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T
O MY mind, downhill skiing is too
much like hard work. Long journeys
from the airport to reach the resorts;
dawdling in queues to take lifts up to
the slopes; expensive ski passes; complicat-
ed clothing; the constant risk of a nasty
accident. I have always wanted to enjoy
everything skiing has to offer without all
of that hassle. It turns out that for those in
the know, the answer is cross-country ski-
ing. If you want to test it out this season,
Seefeld in Tirol certainly converted me.
Tirol hosted the Nordic skiing part of the
1964 and 1976 Winter Olympics and this
January it hosts the first-ever Youth Winter
Olympic Games. That makes Seefelds
sporting facilities world-class in the sum-
mer, its altitude also makes it a popular
training base for top football teams the
Dutch national team prepared there for
the 2010 World Cup. Even downhill fans
can feel at home its where parallel turns
were invented in 1933, and there are still
plenty of opportunities to perfect your own
if you want to.
But it is the extent of its cross-country
facilities, with 279 prepared cross-country
trails at all difficulty levels and a dedicated
cross-country ski school, that sets it apart.
That, and the ease of access to them. My
wife and I were whisked from Innsbruck
airport to our hotel in barely half an hour,
in less time than we needed to gasp at the
view.
Seefeld is a charming small town, where
luxury hotels and celebrity visitors like
Michael Schumacher rub shoulders with
homely bed and breakfasts and couples
and families from all across Europe the
average visitors age is 38. The cross-coun-
try trails stretch between five towns, allow-
ing them all to retain a small scale and
individual character. The others are
Leutasch, Scharnitz, Reith and Mosern-
Buchen (whose landscape is immortalised
in Albrecht Durers great 1498 self-portrait,
now in the Prado). But Seefeld is the areas
bustling heart and the best base for an
introduction to the region the others are
easily reachable by bus if you want to ski
their trails for a day.
We arrived at the end of January, when
Seefeld hosts its annual snow festival, so
the town was lively with
teams of snow sculptors busily refining
their creations dragons, a pair of dancers,
a hand holding a diamond ring.
UNDERSTATED ELEGANCE
We stayed at the Krumers Post hotel in the
centre of Seefeld, from which we could
walk in a few minutes to the start of the ski
trails. We just had time to notice that, like
so much in the town, the Post was elegant
but understated, a very comfortable and
rather British combination. Then we
dashed out to ski.
My wife is an experienced cross-country
skier, while I am a rank amateur, and both
of us found plenty to enjoy. The main loop
is easy enough for beginners, without
being so flat as to be tedious for those with
more skill, and there are plenty of more
challenging trails at varying levels branch-
ing off. Set on a wide alpine plateau, the
views are glorious.
If you dont have your own gear, the hire
facilities are excellent, and the instructors,
led by an ex-Olympian and dressed in
smart, BMW-sponsored yellow uniforms
challenged my wife to develop her skate
skiing technique while being very patient
with me as I learned some classic cross-
country skills (see the box on p.32 for more
on the different forms of cross-country).
In truth though, one of the nice things
with cross-country is that, while the better
you are the easier it is and a few lessons
certainly help, it is also possible to snap on
a pair of skis and shuffle your way along,
picking it up as you go although after a
few hours, my muscles were certainly
noticing the workout.
Luckily, that gave us an excuse to nip
back to the hotel and plunge into the Posts
extensive, brand new spa facilities. Aching
muscles were pummeled away on the mas-
sage table and warmed in the range of
saunas (modest British types should be pre-
pared for European attitudes to public
nudity, but should be reassured that,
thanks to windows in the saunas, you can
simply look at the view of the slopes out-
side instead), before we collapsed in the
relaxation room where you can laze on a
waterbed, munching an apple and enjoy-
ing a wonderful view of the town. There
are even reading lights and headphones
with piped music to help you unwind, as
you contemplate not only the prospect of a
splendid, five-course dinner but the smug
knowledge that, after a day exercising all
the major muscle groups, you deserve to
eat whatever you like.At the Post hotel,
thats just as well, because it knows how to
indulge its guests appetites. On Sundays
theres even a special gala dinner with free
aperitifs and a special dessert that gets
brought into the dining room by a parade
of waiting staff.
The next morning, appetites sharpened
once again by the sort of sound sleep you
earn exercising all day in the open air, we
CONTINUED ON PAGE 32
If skate skiing
through the
mountain air
(above) isnt excit-
ing enough, try the
biathlon (right).
Seefeld in Tirol is the ideal place to try out Nordic skiing, shoot a rifle in
biathlon or to relax in front of a picture-perfect view, writes Marc Sidwell
Ski Seefelds winter wonderland
Lifestyle
HAWKSMOORS
GUILDHALL
RESTAURANT
REVIEWED TOMORROW
31
SEEFELD IN TIROL | FURTHER HIGHLIGHTS
lWhen we visited, the weather was
almost uncannily perfect: bathing us in
crystal air and hours of bright sun. While
it may not always be quite that good,
Seefeld is a wide alpine plateau, which
does give it more sun for longer, and it
benefits from plenty of fresh snow with
little winter fog to spoil the view across
the valley.
lFor night owls who fancy a spot of cre-
puscular cross-country, you can keep slid-
ing along despite the fading light thanks
to a night-trail between Seefeld and
Mosern. From Monday to Friday, 5pm to
9pm, you can enjoy this 3km long floodlit
run. There is also night-time cross-coun-
try in Leutasch.
lFor those determined to point their
skis only downhill, theres a small but
excellent alpine ski area, admittedly one
that is perhaps more suited for beginners
and younger skiers. There are 48km of
slopes and around 30 gondolas and lifts
available, from 1,200m up to 2,064m.
Snowboards are also well catered for in
Seefeld: the Crazy Hole fun park has 12
obstacles. Again, theres skiing by flood-
light in Leutasch and Seefeld, you can
often go skiing at night. In the region, five
ski schools look after both beginner skiers
and those who want to improve their
technique.
lIf you prefer to be out and about with-
out skis, the region offers more than
140km of cleared winter walking paths,
and we enjoyed several glorious walks in
the crisp air. You can take a short walk
near the town, theres a good one around
the lake that only takes about an hour, or
take an extended winter hike up among
the ski trails. Guided snow-shoe hikes
with experienced mountain guides can
also be laid on for trips into the undis-
turbed countryside. Or for those who pre-
fer to see the sights sitting down, there
are five toboggan runs as well as horse-
drawn sleigh rides.
lSeefeld is not just for winter sports. A
year-round resort, it actually gets an
equal number of visitors in the summer as
the winter, when the melting snow turns
its ski trails into hiking and biking paths.
There are 650km of waymarked trails,
mountain and climbing routes and
250km of mountain bike trails. Twelve
indoor and twenty outdoor tennis courts,
a championship golf course at Wildmoos
and three swimming lakes mean this
alpine setting is a wonderful place for an
active summer as well.
E
ngland claimed an against-the-odds win
against world champions Spain on
Saturday. The reception to the victory,
however, was muted, following as it did
a defensive display Bolton Wanderers would
have been proud of. Not exactly the stuff as
footballing dreams are made on.
But manager Fabio Capello was simply
applying statistics. Spain were clear favourites
to win (England were ranked as underdogs by
every bookmaker in the country). So Capello
flooded the midfield, massively decreasing the
chance of either side scoring and therefore
reducing the chance of England being on the
receiving end of a hammering. In the
event, the tactics payed off and
England grabbed the games only
goal.
This is a very simplistic applica-
tion of statistics to football. But
many clubs are going far deeper,
using complex algorithms to help
them gain an edge.
Manchester City scored only
10 set piece goals last season,
equating to 22 per cent of
their total (contrast this to
Stoke, with 44 per cent).
They are on course to dra-
matically increase this,
based on their games so-
far this term. The differ-
ence? Statistics, apparently. The
club is one of the increasing number to use
computers to analyse games, including suc-
cessful corners and free kicks, noting factors
including the speed, height, angle and spin of
the ball. Players can then be trained according-
ly: to take the perfect free kick, for example.
Of course, statistics alone are not responsi-
How computers could be Englands best chance
GEEK SPEAK
@steve_dinneen
ble City have spent the GDP of a small coun-
try on players this year, presumably increasing
their set piece acumen.
But analysing these stats can give a club an
edge. During his time as manager of Liverpool,
Rafa Bentez used controversial zonal marking
for set pieces, in which a player is tasked with
policing an area of pitch, rather than a player.
When this goes wrong, it can make a team
look incredibly inept, leading some managers
to dismiss it. But over the six seasons Bentez
was in charge, Liverpool twice conceded fewer
set piece goals than any other club in the
league.
Statistics make it easier for managers to
overlook the odd, albeit conspicuous,
howler and employ the most consistent
strategy. Top players use statistics
every match they play, although they
would probably give you a blank
stare (blanker than usual) if you
told them. While commentators
talk of intuition when a player
makes a perfect run into the box,
in reality he is just playing the
odds, and has probably made the
same run unsuccessfully several
times before. Computers just help
us understand what these odds mean and how
we can take advantage of them.
Americans have been doing the same thing
for years. Their sports fans revere statistics in
a way that would make Fantasy Footballs
Statto look ill informed.
One of the first proponents of the application
of statistics to sport was Oakland A baseball
coach Billy Beane. He shunned big name (and
big money) players, instead relying on computer
programs to pinpoint the most consistent play-
ers, regardless of stature or reputation.
They went on to win everything and Beanes
success has been made into a biopic starring
Brad Pitt (Moneyball, out later this month).
Englands Under-21 manager Stuart Pearce
is known to be a fan of advanced analytics,
sifting through comprehensive breakdowns of
his sides performances. Fabio Capello is
thought to be less convinced. Perhaps he
should reconsider looking at Englands
chances of winning a major trophy, I think we
need all the help we can get.
By way of full disclosure, I owe credit for
this column to the guy sitting next to me at
the pre-match dinner on Saturday, whose
name I forget (or perhaps never knew), who
very eloquently explained large parts of this.
CONTINUED FROM PAGE 31
fuelled up for the day at the Posts epic
breakfast buffet where an omelette chef
was also on hand to whip up something a
little more substantial. Then, we headed
out in search of guns.
If you think cross-country still sounds a
little sedate, a biathlon training session is
recommended. It was huge fun, and again
XC SKIING | NEED TO KNOW
catered for a wide-ranging group that
mixed overweight Sunday skiers with
more athletic types, offering everyone a
great mornings entertainment.
The facilities are Olympic standard, nat-
urally, and the sheer challenge of trying to
go from skiing at pace to lying prone and
firing at targets, before getting up to ski
some more (including penalty laps if you
miss too many targets) is exhilarating.
Soon we were ready for some well-earned
Albrecht Durer (left)
liked the landscape;
he missed out on the
Christmas market
(above) and the Post
hotels relaxation
room (right).
Lifestyle
beers and lunch on the ski
centres rooftop cafe,
enjoying watching every-
one else gliding over the
snow. From our rooftop
eyrie, we could see the Olympia Sport and
Congress Centre, and decided to pop in. If
youre staying in a bed and breakfast with-
out spa facilities, this is the place to come.
For a small fee theres access to a big indoor
pool and a range of beautiful saunas at dif-
ferent temperatures, one with a panoramic
view. The centre also holds the local cine-
ma, if you really need a change from the
landscape. Then it was back into town
where the snow festival was getting into
full swing. As the afternoon shaded into
evening, ice bars serving gluhwein and
food stalls from local restaurants were
interspersed with DJs and the completed,
glittering snow sculptures.
Locals and visitors thronged the main
streets and by the time the local star
Gregor Glanz was performing, the town
square was packed. Fireworks soared, gluh-
wein warmed and I was already mentally
booking my return ticket. Ill be there over
Christmas this year. See you on the cross-
country trails.
Double rooms at the Krumers Post hotel in
January 2012 start at 112 per person per night
for half board. Visit www.krumers.com/en
For more information, including holiday pack-
ages, visit www.seefeld.com
lLanglauf, Nordic skiing, XC skiing... cross-coun-
try has many names, but the essential principle is
the same. Rather than simply letting gravity push
you down slopes, you can also go uphill and along
the flat, propelled by sliding motions somewhat
reminiscent of ice skating. You dont have to pay
for expensive passes or take elaborate cablecars
and chairlifts to get onto the trails, which often
run almost straight from your hotel. Originating as
a means of transport and hunting in the winter
months, today there are two main varieties.
Classic cross-country involves skiing in groomed
ruts, while in the more challenging version called
skate skiing you ski on snow that has been
groomed flat. Both make for fantastic exercise,
but it is exercise of a very low impact kind, making
cross-country a sport that many continue into
their old age. There is a far lower injury risk than
downhill. The sport has a reputation for being
slow and hard work, but really it has something
for everyone. In a venue like Seefeld, as well as
flat tracks where you can glide along and enjoy
the view there are plenty of more difficult loops
all the way up to black level. You can also try out
the biathlon, in which you have to alternate fast
skiing with accurate rifle shooting despite an ele-
vated pulse. You can try it without the snow in
Hyde Park and at other venues on rollerskis.
www.rollerski.co.uk. It is sometimes possible in
Scotland (see for instance www.slochd.co.uk) but
you have to go to Europe or further afield for the
best trails. As well as Austria, top destinations
include Scandinavia, Switzerland, Italy and
France. A company like Exodus can help find the
right holiday for you: www.exodus.co.uk.
Frank Lampard scored
Englands winner
against Spain on
Saturday
T
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A QUESTION OF SPORT
BBC1, 10.35PM
Jonathan Trott, Imogen Cairns, Lee
Sharpe and Kelly Sotherton join team
captains Matt Dawson and Phil Tufnell
for the sports quiz, hosted by Sue Barker.
MASTERCHEF: THE
PROFESSIONALS BBC2, 8.30PM
Ten chefs compete in an invention test
in the hope of impressing judges
Gregg Wallace and Monica Galetti for
a chance to cook for Michel Roux Jr.
REAL CRIME WITH MARK
AUSTIN... ITV1, 10.35PM
The case of jigsaw killer Stephen
Marshall, who murdered Jeffrey Howe
and scattered his body parts around
Hertfordshire and Leicestershire.
BBC1
SKY SPORTS 1
5.25pmLive International
Football 7.30pmLive Darts
11pmSoccer AM12amFIFA
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3.25am-6amLive Test Cricket
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Football 12amEuropean Tour
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BBC THREE
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Skin Deep: The Business of
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12.35amSkin Deep: The
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2.05amMongrels 2.35am
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4.05am-5amHot Like Us
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7pmHollyoaks 7.35pmHow I
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1.55amHow I Met Your Mother
2.20amMy Name Is Earl
3amMeet the Parents
3.30amMake It or Break It
4.10amRules of Engagement
4.30amDesperate Housewives
5.15am-6amSwitched
HISTORY
7pmHeir Hunters 8pmStorage
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American Restoration 10pm
American Pickers 12amPawn
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American Pickers 5am-6am
Monster Moves
DISCOVERY
7pmWhale Wars 8pmWheeler
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Mythbusters 10pmBattle
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Superhumans 12amBear Grylls:
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Deadliest Catch 3.50amRiver
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7pmSpecial Delivery: Baby ER
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Fringe 1.50amRoad Wars
2.40amMental 4.20am
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BBC2 ITV1 CHANNEL4 CHANNEL5
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1993.
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Fill the grid so that each block
adds up to the total in the box
above or to the left of it.
You can only use the digits 1-9
and you must not use the
same digit twice in a block.
The same digit may occur
more than once in a row or
column, but it must be in a
separate block.
COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
KAKURO
QUICK CROSSWORD
LAST ISSUES
SOLUTIONS
KAKURO
WORDWHEEL
Using only the letters in the Wordwheel, you have
ten minutes to nd as many words as possible,
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters
or more, all must contain the central letter and
letters can only be used once in every word. There
is at least one nine-letter word in the wheel.
SUDOKU
Place the numbers from 1 to 9 in each empty cell so that each
row, each column and each 3x3 block contains all the numbers
from 1 to 9 to solve this tricky Sudoku puzzle.
SUDOKU
QUICK CROSSWORD
ACROSS
1 Issue commands
or orders for (9)
8 Modify (5)
9 Sepals of a
ower (5)
10 Grazing land (3)
11 Bill for an amount
due (5)
13 Flour and water
dough (5)
15 Many times (5)
18 Ecstasy (5)
20 Grow older (3)
21 Tilt (5)
22 Harmless tropical
house-lizard (5)
23 Fill something
previously
emptied (9)
DOWN
2 Nocturnal badger-
like carnivore (5)
3 Inclined to anger or
bad feelings (5)
4 Provide a brief
summary (5)
5 Hollow devices that
make a ringing sound
when struck (5)
6 Draught animal (9)
7 Enlargement (9)
12 Falsehood (3)
14 Each and every (3)
16 Commerce (5)
17 Region of South Africa,
KwaZulu-___ (5)
18 Commence (5)
19 Peruvian tribe at the
time of the Spanish
conquest (5)
T
C
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F
T U
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4

4
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S A F E S C O P R A
W I P H R P
A F G H A N I O P T
M D P R L
P A S T E S H A K Y
H T
G U A R D B R A C E
A T U R E
L E T C L A M O U R
E E H Y V I
S T R A Y S N A K E
5 8 9 7 7 3 9 8
2 6 1 3 2 1 8 3
3 9 1 4 6 2
1 7 5 7 9 9 5
6 2 3 5 4 8 1
8 3 9 5 1 4 7 6 2
9 5 7 4 2 8 6
4 1 8 5 3 8 4
9 7 8 1 7 1
9 7 8 6 6 3 9 8
3 2 7 1 3 1 4 2
4
4
4
4
4
4
4
4
4
WORDWHEEL
The nine-letter word was
CORPUSCLE
Lifestyle | TV&Games
BRITAINS Lewis Hamilton hailed yes-
terdays victory at the Abu Dhabi
Grand Prix as one of the finest per-
formances of his career.
The McLaren driver profited from a
puncture suffered by world champion
Sebastian Vettel on the opening lap
which put paid to the Germans hopes
of equalling Michael Schumachers
record of 13 wins in a single season
to finish ahead of Spains Fernando
Alonso and team-mate Jenson Button.
The 26-year-old has endured a tur-
bulent season on the track, clashing
on several occasions with Ferraris
Felipe Massa, while off it he has had to
cope with the emotional strain of
breaking up
with his pop
star girl-
f r i e n d
N i c o l e
Scherzinger.
But after
turning in such
a command-
ing perform-
ance at the
Yas Marina
circuit, the
2008 world
champion
sensed the
most difficult period of his career was
finally drawing to a close.
I feel fantastic, Hamilton said. It
was one of my best races. To hold off
one of the best drivers in the world is
very tough to do. Weve a great race in
Brazil coming up,
so I just need
to try and
keep the
m o m e n -
tum.
Hamilton is
up to fifth in the
D r i v e r s
Championship with
just one race of the season
remaining at Interlagos.
Sport
34
CHELSEA and England midfielder
Frank Lampard is targeting a century
of caps after marking his 90th in the
most memorable fashion.
Lampard captained the side and
scored the winner as Fabio Capellos
men recorded a surprise 1-0 win over
world and European champions Spain
at Wembley on Saturday.
If I get to 100, I will be delighted to
have that next to my name. Ive
achieved a lot of things Im proud of
and I want to keep on achieving, he
said. But Im at the stage now where
I dont look too far ahead. Ten caps is
quite a long time in international
football so I wont get too far ahead of
myself.
Epitaphs for Lampards internation-
al career were being written earlier
this season when he briefly lost his
place for club and country.
But he has enjoyed a resurgence
since and, depending on selection and
Englands progress at Euro 2012,
could reach the 100-mark shortly after
his 34th birthday in June.
Lampard also rejected Spain coach
Vicente del Bosques suggestion that
Englands past failures at World Cups
were down to mental weakness.
SPAIN midfielder Cesc Fabregas has
taken a swipe at the defensive style
that earned England a shock victory
in Saturdays friendly at Wembley.
Former Arsenal captain Fabregas
admitted his disappointment at
Englands lack of ambition in attack,
even once they had led through
Frank Lampards header.
And the Barcelona star,
who returned to
Catalonia in the summer
after eight years in north
London, insisted Spain
were happy despite
defeat because of their
dominance.
At the end of the day, you
want teams to have a go at you
and test you and see what happens.
We knew, especially after we saw the
first XI that they put in, that they
were going to defend basically the
whole game, he said.
Even when they were winning,
they had [Danny] Welbeck up front
alone and everyone just defending.
But this is the way they want to play
and it worked for them. We dominat-
ed the game and we made England
defend nearly the whole 90 minutes.
We played two completely different
styles of football. The more defensive
one won but we knew that the only
way they could score was from a free-
kick or a corner and we conceded a
not very intelligent free-kick there. We
paid for it but, basically, we are happy
because we played very well.
Spain peppered Englands goal with
21 efforts during an increasingly one-
sided encounter while the home side
mustered just three, although both
teams managed just two apiece on tar-
get. Tottenham midfielder Scott
Parker, named man of the match,
made a series of last-ditch intercep-
tions as the visitors probed for an
equaliser, while centre-back duo
Joleon Lescott and Phil Jagielka,
who returned to Everton last
night in order to rest a toe
injury, also enhanced
their reputations. Capello
(left) said: The two cen-
tre-backs played a fantas-
tic game, really good.
Every time Spain tried
passes through they were
in good positions.
Capello intends to experi-
ment again when Sweden visit tomor-
row, with Chelsea skipper John Terry
set to return to the centre of defence
despite being under investigation by
police and the Football Association for
alleged racist abuse, which he denies.
Terrys Blues team-mate Daniel
Sturridge is set to win his first cap and
will be joined in attack by Fulhams
Bobby Zamora, while Tottenham full-
back Kyle Walker is in line for a first
senior start.
Goal hero
Lampard
targets ton
BY FRANK DALLERES
FOOTBALL
BY JAMES GOLDMAN
FORMULA ONE
Hamilton ready to put the past

behind him after Abu Dhabi win
Lampard scored the winner against Spain
on Saturday Picture: PA
SPORT | IN BRIEF
Chalmers denies Woods
GOLF: Home favourite Greg Chalmers
held off resurgent Tiger Woods to win
the Australian Open. Chalmers shot a
final round of 69 to finish on 13 under
par, one better than countryman John
Senden. Former world No1 Woods was a
shot further back after closing with a 67.
Federer claims successive titles
TENNIS: Former world No1 Roger
Federer claimed the Paris Masters for
the first time with a straight-sets victory
over Jo-Wilfried Tsonga in yesterdays
final. Federer beat the Frenchman 6-1, 7-
6 to seal successive tournament wins,
having triumphed in Basel last week.
Sutton handed County cup tie
FOOTBALL: Non-league Sutton United
have been drawn at home to Notts
County in the second round of the FA
Cup, following their win over Kettering.
Charlton, who beat FC Halifax 4-0 yes-
terday, will host League One rivals
Carlisle while Brentford face Cambridge
or Wrexham.
Ex-Somerset captain in suicide
CRICKET: Former Somerset captain
Peter Roebuck has died, aged 55, in a
case South African police were treating
as suicide. Opening batsman-turned-jour-
nalist Roebuck plunged six floors from
his Cape Town hotel room on Saturday
night, where he was covering the Test
series for Australian media.
Pacquiao to face Marquez again
BOXING: A fourth welterweight show-
down between Manny Pacquiao and
Juan Manuel Marquez is being lined up
after the Filipinos controversial points
win over the Mexican in Las Vegas on
Saturday night. Hopes had been raised
that Pacquiao might finally face
American Floyd Mayweather but his pro-
moter Bob Arum said: Im bound and
determined to have these two fight once
and for all in a decisive fight.
BY FRANK DALLERES
FOOTBALL
1
0
ENGLAND
SPAIN
Spain star
Cesc in swipe
at England
after defeat
Fabregas said
England set out
only to defend
Picture: GETTY
I
TS BEEN a terrific start to the sea-
son here at Saracens and I was
delighted to see the side carry
their domestic form into the
Heineken Cup yesterday.
Treviso are a powerful side with a
finely tuned set-piece, so to run in five
tries and gain a bonus point was a
marvellous achievement.
Owen Farrell starred again and the
speed of his development has been
incredible to witness over the last 12
months. Hes a great example of
someone who has succeeded because
he possesses the sort of focus all great
players require.
The start of the Six Nations is still
some distance away but Owen, who
really reminds me of Mike Catt, is cer-
tainly someone the selectors should
be looking at as England attempt to
move on from the World Cup.
At the other end of the age spec-
trum it was an encouraging try-scor-
ing debut from former Springboks
skipper John Smit. Much was made of
his signing considering how well
stocked we are for hookers, with the
likes of Schalk Brits and Jamie George
in the squad.
John understands he may be
restricted in terms of playing time but
hes really excited by the project and is
looking forward to helping the devel-
opment of our young players.
GROUNDBREAKING
It was a pretty exciting week off the
field too at Saracens with the confir-
mation that Cape Town Stadium
would host Januarys Heineken Cup
match against Biarritz.
This has become a bigger issue in
South Africa than you might imagine
with the traditional venue at
Newlands overlooked in favour of a
new modern stadium. Its also been
mooted that this groundbreaking fix-
ture could eventually trigger the
involvement of South African clubs in
the Heineken Cup.
It certainly makes sense from a trav-
el point of view, while it also appeals
to broadcasters who would be show-
ing matches closer to primetime than
is the case when our teams go to
Australia and New Zealand.
REFLECT
Of more immediate concern, however,
are the upcoming fixtures against
Biarritz and then London Irish, who
lost this weekend minus the services
of the suspended Delon Armitage.
Its the fourth time Delon has been
in trouble with the authorities this
year and he must use the time this lat-
est enforced absence provides him
with to evaluate his playing style.
Ive got a lot of time for Delon hav-
ing coached him while he was break-
ing through at Irish, but there comes
a time when you have to accept what
youre doing on the field is wrong.
Brendan Venter is technical director of
Saracens, who play London Irish in the
Aviva Premiership at Vicarage Road on
Sunday 4 December, kick-off 2pm. See
www.saracens.com or call 01727 792800.
35
ENGLAND have suffered a blow after
Shaun Edwards, mooted as a possible
replacement for embattled manager
Martin Johnson, agreed a new con-
tract as Wales defence coach.
Edwards, whose deal expired at the
end of last months World Cup, parted
company with Wasps last week,
increasing speculation of a move to
the England set-up, but Welsh chiefs
last night confirmed his decision to
stay put.
It comes amid growing feeling that
Johnson could be about to quit his
post, following the damaging fall-out
from a disastrous World Cup for
England, whose reputation suffered
hugely on and off the pitch.
Welsh Rugby Football Union chief
executive Roger Lewis said he was
delighted to have tied Edwards to a
new deal that is thought to run until
the end of the 2015 World Cup.
It was more than apparent
through the extraordinary coverage
in the UK press that Shaun was in con-
siderable demand from many quar-
ters and there were many options
open to him in this country and in
Europe, said Lewis. He smartly went
off to New York last week, because he
was being bombarded. I kept in touch
with him daily out there and conclud-
ed matters positively on Saturday.
It is the second time Wales have suc-
ceeded in holding onto Edwards in
the face of fierce demand, and comes
as a blow to England chiefs, who could
be plunged into further disarray this
week if Johnson walks away.
World Cup-winning former captain
Johnson was quizzed last week at the
Rugby Football Unions two-day man-
agement review of the failed cam-
paign in New Zealand, but former
England prop Jeff Probyn hopes he
resists the urge to resign.
He said: Theres enough specula-
tion going on, hes got options else-
where. He may well [resign], but it
would be a shame if he did.
BY FRANK DALLERES
RUGBY UNION
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email sport@cityam.com
England cant afford to overlook Farrell
RUGBY UNION COMMENT
BRENDAN VENTER
Edwards ruled out as
Johnson replacement
DEFENCE
With doubts
surrounding
the fitness of
Rio Ferdinand
and John Terry
in less than
vintage form,
Capello would have been delighted to
witness Phil Jagielka (above) and
Joleon Lescott showcase the formi-
dable partnership they once formed
at Everton functioning so well
against the world champions. Ashley
Cole and Glen Johnson remain
Capellos first choice full-backs.
SPANISH LESSONS |
WHAT CAPELLO LEARNED
MIDFIELD
Scott Parker
(right) has
established
himself as a
vital cog in
Englands
wheel and,
with Jack Wilshere likely to return
once fit, one of Steven Gerrard and
Frank Lampard may well miss out on
a starting berth. The Chelsea mans
greater tactical discipline and recent
return to goalscoring form puts him
ahead of his Liverpool rival.
ATTACK
Competition for
places on the
flanks remains
ultra competi-
tive with none
of James
Milner, Adam
Johnson, Theo Walcott and Stewart
Downing covering themselves in
glory on Saturday. Up front, despite
the part he played in the goal, Darren
Bent appeared easier to contain than
the busier and more powerful Danny
Welbeck (above).
KICKING KING | Owen stars for Sarries
SARACENS fly-half Owen Farrell contributed 22 points as the Premiership champions
began their Heineken Cup campaign with a 42-17 bonus-point victory over Benetton
Treviso. Farrell scored an early try, landed four conversions and kicked three penalties,
while former Springboks skipper John Smit made a try-scoring debut. Elsewhere, a late try
from Clement Poitrenaud saw Toulouse beat Gloucester 21-17. Picture: PA
Results
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