Myners Lines Up Panel For Royal Mail Probe

By Mark Kleinman, City Editor

A quartet of business heavyweights have been drafted in by Lord Myners, the former City minister, as he probes the controversial process which saw Royal Mail sold to the private sector last year.

Sky News has learnt that Jitesh Gadhia, a non-executive director of the body which manages taxpayers' stakes in Lloyds Banking Group and Royal Bank of Scotland, has been signed up as members of a panel examining whether the public was poorly served by the way the postal operator's sell-off was handled.

The review was ordered in July by Vince Cable, the Business Secretary, on the same day that Sky News revealed the details of a coruscating report by a parliamentary select committee on the £3.3bn privatisation.

Lord Myners, who served in the last Labour administration, was asked by Mr Cable to oversee the review, and Lord Myners has now written to fund managers to set out the scope of his inquiry.

Sources familiar with his letter said that David Challen, a former Citigroup banker; Francesca Cornelli, a professor of finance at the London Business School; and Huw Jones, head of corporate governance at M&G Investments, were the other members of the panel that will work on Lord Myners' review.

The former City minister wrote that he would be assessing the reasons for the UK capital markets' use of a process known as book-building, which helps to establish the price at which a company's shares will be sold when it lists on the stock market.

In the case of Royal Mail, the book-build proved to be contentious because fund managers indicated that they would not be prepared to pay more than 330p. effectively forcing the Government and its advisers to set the price at that level.

On the first day of trading, the company's shares soared by more than 35%, leading to accusations that ministers' decision-making had cost taxpayers £1bn in lost proceeds.

Lord Myners and his panel will also examine the approach taken in other countries to pricing initial public offerings (IPOs), the process for selecting cornerstone investors, and any alternative routes to primary listings of shares.

"I have asked Lord Myners to conduct this review, following the recommendations of the National Audit Office, to help me assess whether changes are needed to the current system government operates for the sale of its assets," Mr Cable said in July.

A source at the Department for Business, Innovation and Skills confirmed the contents of Lord Myners' letter.

00.25 | 0 komentar | Read More

Salmond: Leaders' Vow A 'Desperate Offer'

How Facebook Shaped The Referendum

Updated: 8:27am UK, Tuesday 16 September 2014

By James Matthews, Scotland Correspondent

It's Facebook 'wot might win it.

Sure, the August poll surge in support for independence was down, in part, to traditional campaigning. Meetings and megaphones have thrust the Yes campaign "in yer face" over years leading up to Thursday.

But why, according to the opinion polls, did it all seem to come together in the space of a few weeks? Why, suddenly, the knife-edge?

In the word of a senior Yes strategist: Facebook.

I chatted to him as the Alex Salmond Labour Heartland tour rolled up at its latest venue, playing to the target market through the TV cameras. It was a big, well-attended, photo-call - the staple diet of the political campaign.

As the strategist stood back from the madding crowd, he told me that the magic formula didn't lie in the blood and snotters of a mass media scrum, but in the quiet exploitation of social media. Facebook, in particular.

The challenge for supporters of Scottish independence, historically, has been in turning it from a fringe notion into something people allow themselves to contemplate. Check their election success at the Scottish Parliament to see the considerable style with which that's been accomplished.

Scots have taken the hop and a step. Why, now, might they be shaping to take the jump? 

The Yes strategist pinned it on Facebook.

"Ask yourself," he said, to paraphrase him, "if a parent wants to check on their youngster who's on a night out, what do they do?  They don't phone them, because they probably won't answer.

"They might text ... but, invariably, they'll Facebook them. And when they do, dozens or hundreds of their friends will see it. It's a chat network that plugs people into the other people they value. There are no better opinion-formers for someone than the friends and family they like and trust.

"So, as a campaigning tool, it's been very effective. We encourage Yes supporters to spread the word to their Facebook friends and, over time, you build a network around people that builds a political case.

"Facebook is more effective than Twitter. You put something on Twitter and you reach people within the political bubble. With Facebook, you tap into a far bigger community."

So why the spike in support for Yes after polls that had No with a consistent and strong lead over the course of a two and a half year campaign?

"People just didn't turn their mind to the referendum until it actually came round. It's been in the far distance for most of the campaign but, now that people realise they're getting to decision time, large numbers are now weighing up the arguments ... and they're deciding having had their views on independence softened by Facebook friends."

There were more than 10 million referendum-related interactions on Facebook in the five weeks to September 8 - 85% of which was from Scotland.

He said he reckoned the Yes campaign had been four or five times more active than their opponents on Facebook and pointed out a Facebook chat with Scotland's pro-independence First Minister Alex Salmond attracted around 5,000 questions.

Data suggests the Yes campaign is slightly in the lead with 2.05 interactions in Scotland compared to 1.96 million for the no campaign.

The strategist said the campaigning beauty of social media was that it eliminated the need to rely on mainstream media coverage, that the likes of Facebook cut out the middle man and enabled them to reach out to the voter directly.

Just how many the campaign has touched and what effect it has had, we'll find out soon enough.

00.25 | 0 komentar | Read More

Inflation Slips But House Price Growth Surges

Official figures have charted an easing in the annual rate of inflation but house price growth accelerating to a seven-year high - with six UK regions achieving new price peaks.

Separate releases by the Office for National Statistics (ONS) showed CPI inflation at 1.5% - falling back from 1.6% the previous month - with the biggest contributions coming from the supermarket price war and falling petrol costs.

This means that while wage growth remains much weaker that the rate of inflation - maintaining the squeeze on earnings - the gap was slightly reduced.

London house price growth slowed in July

However, the ONS statistics on house prices showed that purchasers would need to dig deeper for a deposit.

The average cost of a home rose 11.7% to a new record high of £272,000 in the year to July, though annual growth in London slipped slightly to a rate of 19.1% from 19.3% the previous month.

The study - by nation - showed prices rose 12% in England, 7.4% in Wales, 7.6% in Scotland and 4.5% in Northern Ireland.

It also measured property prices reaching fresh all-time highs in six UK regions.

The East Midlands, West Midlands and South West joined London, the East and the South East in having price levels higher than their pre-financial crisis peaks of 2007/08, the ONS said.

The recovery in building has been too slow to help temper price growth

Estate agents have reported seeing signs of disruption to the housing market in Scotland in recent weeks, with potential buyers putting their plans on hold while they wait to see what the outcome of the referendum on independence will be.

The report also showed that first-time buyers face having to pay 13.5% more to get on the property ladder than they did a year ago - and the ONS said this was the highest annual increase recorded for the sector since March 2005.

The average price paid by a first-time buyer in July this year was £209,000.

The Bank of England, which is mulling the timing of the UK's first interest rate rise since March 2009, is likely to see the inflation and house prices figures as further evidence of little immediate pressure for action.

Bank governor Mark Carney has cited concerns on consumer debt and wage growth.

00.25 | 0 komentar | Read More

Retailer Phones 4u 'Forced Into Administration'

Phones 4u stores are closed with thousands of jobs at risk after the retailer said it was being forced into administration by network operator EE's decision to join Vodafone in cutting ties with the firm.

The retailer, which employs 5,596 people, said its 550 standalone stores would be shut until administrators decide on whether the business can reopen for trading.

Inquiry lines were still operational though the Phones 4u customer service line referred callers to the website, which has been taken offline.

The company said the decision by EE not to renew its current contract, which is due to end in September next year, was a "complete shock" and meant it would be left without a single network partner after Vodafone said earlier this month that it would not extend its agreement.

Potential store customers were greeted by closed doors and a short notice

Phones 4u said it has a healthy balance sheet with profits of more than £100m but had no option but to go into administration.

However, workers facing the threat of redundancy have been given hope by rival firm Dixons Carphone - Sky News has learnt that the business is preparing to highlight at least 1,500 vacancies at Carphone Warehouse stores for which Phones 4u staff would be eligible.

Phones 4u executive David Kassler said: "Today is a very sad day for our customers and our staff.

The retailer said the decisions of EE and Vodafone were a 'complete shock'

"If the mobile network operators decline to supply us, we do not have a business.

"A good company making profits of over £100m, employing thousands of decent people has been forced into administration.

"The great service we have provided should have guaranteed a strong future, but unfortunately our network partners have decided otherwise.

"The ultimate result will be less competition, less choice and higher prices for mobile customers in UK."

Staff were asked to report to work as normal on Monday for a management briefing.

Phones 4u said all mobile contracts bought through Phones 4u would remain unaffected and the networks would continue to provide mobile services to these customers.

Customers were also told that orders which were not dispatched in advance of the decision will not be honoured, though full refunds will be given.

The formal process of appointing PwC as the administrator was expected to take place later on Monday.

The business was set up by John Caudwell, who sold it in 2006 for £1.5bn

The announcement helped shares in Dixons Carphone rise 4% in early trading.

Stefano Quadrio Curzio of BC Partners, Phones 4u's private equity owner, said: "Our overriding concern is for all the dedicated hard-working employees of Phones 4u at a time of uncertainty for the company.

"Vodafone has acted in exactly the opposite way to what they had consistently indicated to the management of Phones 4u over more than six months.

"Their behaviour appears to have been designed to inflict the maximum damage to their partner of 15 years, giving Phones 4u no time to develop commercial alternatives.

"EE's decision on Friday is surprising in the context of a contract that has more than a year to run and leaves the board with no alternative but to seek the Administrator's protection in the interests of all its stakeholders."

A spokesperson for EE said its decision not to extend its contract with Phones 4u was part of a focus on supplying customers directly and questions surrounding the "long-term viability" of the Phones 4u business. 

Vodafone said it was "saddened" to read about Phones 4u's plight and added: "We strongly reject any suggestion that we behaved inappropriately at any stage during our negotiations with Phones 4u."

It has been revealed that Vodafone was in talks about a joint takeover of Phones 4U as recently as two months ago but abandoned the proposed deal without explanation.

Sky News has learnt that Vodafone executives discussed at a meeting in June with financial and legal advisers to Phones4U a takeover of the chain by the mobile phone network along with EE, its rival.

00.25 | 0 komentar | Read More

Santander UK To Name Bostock As New Chief

By Mark Kleinman, City Editor

A former finance director of Royal Bank of Scotland is poised to be named as the new of Santander UK, Britain's fifth biggest lender.

Sky News understands that the Spanish-owned bank may announce as early as Tuesday that Nathan Bostock will be appointed as its next chief executive.

The move had been widely expected since Mr Bostock was installed as deputy chief executive late last year, quitting the state-backed RBS after just 10 weeks as its finance director.

Mr Bostock will replace Ana Botin, who was last week elevated to become group executive chairman of Banco Santander following the death of her father, Emilio Botin.

Santander UK's board is meeting on Tuesday morning to discuss the appointment of its new boss.

It is understood to have discussed the plan to name Mr Bostock as chief executive with the Prudential Regulation Authority and Financial Conduct Authority in recent days.

Last week, Lord Burns, Santander UK's chairman, paid tribute to Ms Botin's leadership, saying that directors would meet this week to identify the new chief executive.

"In just three-and-a-half years, Ana has transformed Santander UK, turning three former building societies [Abbey National, Alliance & Leicester and Bradford & Bingley] into one of Britain's most successful banks," he said.

It remains possible that Ms Botin will replace Lord Burns, who has indicated his wish to step down, as non-executive chairman of the UK bank.

A Santander UK spokesman declined to comment.

00.25 | 0 komentar | Read More

Asos Warehouse Fire Cost Up To £30m

Online fashion retailer Asos says a fire at its Barnsley warehouse this summer cost it up to £30m in lost sales.

The company made the announcement in its trading update for the three months ending August 31 - its final quarter - in which it also warned that significant investment would dent profits in its current financial year.

The blaze, in June, damaged 20% of stock inside the premises and a criminal inquiry is continuing into how it started, with arson suspected.

Asos managed to restart orders within 48 hours of the fire and then launched a sale, with discounts of up to 50%, a day later.

Chief executive Nick Robertson said: "Our UK performance remained strong over the final quarter, with sales increasing 33%.

The fire was treated as suspicious by police. Pic: @mathew_hanley

"Our international business grew 6% or 14% in constant currency.

"However, due to the fire at our Barnsley distribution centre, we lost sales during the quarter of between £25m and £30m with a retail gross margin impact of circa 200 basis points.

"After adjusting for insurance proceeds, we expect profit before tax for the year to be in line with market expectations.

"Engagement with our customers remains positive with a 25% growth in active customers and increases in order frequency, conversion rate and average basket value.

Stock was damaged by smoke and water. Pic: @mathew_hanley

"Sales for the year as a whole increased by 27%."

He also announced a new drive to boost its international expansion.

Mr Robertson added: "In the new financial year we'll make significant investments in our international pricing and proposition, as well as in our logistical infrastructure and technology platform.

"As a result, we expect profit before tax for the year to 31 August 2015 to be at a similar level to 2013/14.

"We remain focused on the long-term opportunity for Asos, with £2.5bn of sales as our next staging post."

Asos, once a darling of the stock market, has seen its value under pressure following a series of profit alerts - partly a result of heavy discounting.

Its share price fell 14% in early trading on Tuesday.

00.25 | 0 komentar | Read More

Emotional Tug Of Freedom Against Economic Risk

By Faisal Islam, Political Editor

The Prime Minister has signed off from the independence referendum campaign with a final speech in Aberdeen.

Facing a friendly audience of Scottish pensioners, oil executives and Conservatives, the Prime Minister pleaded with Scots to reject independence in the too-close-to-call referendum on Thursday.

Arriving to a slick marketing video featuring three centuries of historic achievements of the Union - from Pankhurst to Wilberforce and Darwin to the British Lions - an emotional PM told the audience: "We want you to stay. Head and heart and soul, we want you to stay.

Alex Salmond: "Cameron's prints are all over a scaremongering campaign"

"Please don't mix up the temporary and the permanent. Please don't think 'I'm frustrated with politics right now, so I'll walk out the door and never come back'.

"If you don't like me - I won't be here forever. If you don't like this Government - it won't last forever. But if you leave the UK - that will be forever.

"Yes, the different parts of the UK don't always see eye-to-eye. Yes, we need change - and we will deliver it. But to get that change, to get a brighter future, we don't need to tear our country apart."

There would be no "trial separation" but the prospect of a "painful divorce" for the UK under a Yes vote.

The PM's key message, though, was of "safer change". The status quo was not on the ballot paper. He reassured his audience that a No vote would trigger "a major, unprecedented programme of devolution with additional powers for the Scottish Parliament", that Gordon Brown's timetable of delivery by January was "set in stone".

He said it amounted to an offer of guaranteed change for the Scottish people without losing the "UK pension, the UK pound and the UK passport".

The question, of course, is whether the Scottish people are going to trust such promises, as there's a history of that type of thing not being delivered by Westminster.

Some Conservative backbenchers are very nervous of the promises offered to keep Scotland in the Union. In an interview with Sky News Tonight, the leader of the Better Together No campaign Alistair Darling addressed this point and said Labour had promised and did deliver the Scottish Parliament.

But few can tell how such late promises are going to go down with many Scottish people distrustful of what they see as a Westminster elite.

Mr Darling also told Sky News of his concern about how the tone of the campaign had soured, and referred to protests by Yes campaigners against journalists as "deeply sinister".

His assessment that some of the campaigns against out-of-favour journalists by the Yes campaign - posters and the like - were "deeply sinister".

He said there was a quiet majority who might be afraid to speak out, who will say "no thanks" to independence on Thursday.

He also said he found it galling that EU nationals get a vote in Scotland whereas Scots who have moved down south don't get a vote. Although he accepted that this was the agreed system for the referendum.

The broader picture, though, is what some politicians are calling the "air war" - big ideas, facts, debates about currency union and devolution - is over.

The next two days of campaigning is all about the "ground war" - getting the vote out and going into people's homes. And this message of Safer Change is very specifically calibrated - not at Yes voters or No voters - but the fact there is a rump of Scots who have a bit of both Yes and No within them.

Alistair Darling told Sky News that the tone of the campaign had "soured"

They are trying to tip that balance away from the emotional tug of freedom for Scotland towards a hard-headed assessment of economic risk.

Earlier, First Minister Alex Salmond visited Edinburgh Airport where he claimed Mr Cameron's "fingerprints are all over a scaremongering" campaign by banks, businesses and leading retailers who have voiced their concerns over independence.

Mr Salmond said: "The next time he [Mr Cameron] comes to Scotland it will not be to love-bomb or engage in desperate last-minute scaremongering, and following a Yes vote it will be to engage in serious post-referendum talks in the best interests of the people of Scotland and the rest of the UK, as pledged in the Edinburgh Agreement."

The Prime Minister, abundantly self-aware that there are limits to the persuasive appeal of any Conservative prime minister in Scotland, will now return to London for the remainder of this closely-fought campaign. The Labour Party will step up its campaign with the return of Opposition leader Ed Miliband on Tuesday.

00.25 | 0 komentar | Read More

Apple: Delete U2 iTunes Album In One Click

Apple's Smart Watch Is 'Not Pretty': Analysis

Updated: 5:24am UK, Wednesday 10 September 2014

By Tom Cheshire, Technology Correspondent

Remember how simple the first iPod was?

Remember how user-friendly the iPhone was?

Remember how the iPad was a huge hit with people who didn't really use computers?

The Apple Watch is the opposite of that.

It's aimed squarely at power users - and that represents a change of direction from Apple.

First, it's not that pretty - a personal judgement.

It's a bit clunky - just like the original iPhone was, so expect this to get better too with each new generation.

And, it has some smart features. Wireless charging is exciting, and you've got to love the Walkie Talkie capability, if you have any joy in your heart.

Don't fish your phone or wallet out - just tap with your watch to pay.

Then there's the "send-your-heartbeat" feature. As chief executive Tim Cook put it: "It reads your heartbeat and then the receiver feels a vibration that actually matches your pulse."

Cute or creepy? I'd go for the latter. No doubt we'll be spammed by the heartbeats of PPI sellers before long.

But the Apple Watch doesn't look the easiest thing to use - as with most smart watches so far - and it will take a fair amount of work to set.

It solves problems, but only for someone who's already a heavy user of an iPhone.

But otherwise, the new iPhones were as expected.

They look very good, but personally I'm sad to see the smaller screen size go, as I find bigger screens a bit unmanageable for one-finger typing.

Apple Pay is also interesting, and will be big in the US.

But in the UK, we're already getting used to contactless payment on credit and debit cards.

If Apple can make the payment experience seamless though - and merge offline with online - it could be the most important announcement of the night.

00.25 | 0 komentar | Read More

Alibaba Share Sale To Raise Record $25bn

China's biggest online retailer is on course to smash the record for the biggest share sale of all time this week, after increasing the target price for its stock.

Alibaba is set to raise $25bn (£15.4bn) from investors in its flotation on the New York Stock Exchange - with strong interest driving the decision to increase the price target from the planned $60-$66-per-share to $66-$68.

It was reported last week that the flotation was already over-subscribed - with demand from Asia understood to be particularly high - leaving underwriters under pressure to exercise an option to sell additional shares.

The initial public offering (IPO) was previously expected to raise up to $21bn - just shy of the all-time record of $22.1bn set by the Agricultural Bank of China in 2010.

But the e-commerce bazaar's recent financial performance and swift expansion - including plans for operations in the US - has made it a hot property.

The company currently handles more transactions than Amazon.com and eBay combined and its chief executive Jack Ma has already announced plans to expand its interests in Europe and the US.

It confirmed three weeks ago that second-quarter profits had tripled to £1.2bn on the back of soaring revenues, with spending via mobile devices rising almost four-fold.

Kelland Willis, analyst at Forrester Research, told the AFP news agency: "When investors see growth, they get excited."

He pointed to the 150% gains of JD.com, Alibaba's main Chinese rival, which went public in May.

Other experts were more cautious - some citing concerns on governance.

Portfolio manager at Meeschaert Financial Services, Gregori Volokhine said of Alibaba: "They have moved prudently, because it's very difficult to know in advance the appetite of US institutional investors.

"People will be cautious because a lot of investors were burned by Facebook," he noted, recalling the 2012 offering which saw a sharp drop from the opening price because of a glitch.

The IPO, while helping fund Alibaba's planned expansion, is also due to deliver a handsome return for Yahoo!

The internet firm, which bought 40% cent of Alibaba in 2005 for $1bn (£600m), sold almost half of its stake in 2012 but still netted $7.6bn from that.

Its plans to reduce its shareholding further in the flotation is forecast to net it at least another $10bn - money it can use to fund its own diversification.

00.25 | 0 komentar | Read More

Tax Crackdown: World Profit-Shifting Ban Looms

By Ed Conway, Economics Editor

International authorities have unveiled the first step in a major crackdown on billions of dollars' worth of international corporate tax avoidance, warning that existing rules are not fit for purpose.

The Organisation for Economic Co-operation and Development (OECD) said its plan would help prevent the kind of legal corporate tax avoidance which it is alleged has been used extensively by companies such as Apple, Google and Starbucks.

Its detailed new proposals, seven of which are published today, are largely aimed at stemming the extent to which companies can shift profits from one country to another in order to take advantage of lower tax rates.

Such practices are particularly common among tech businesses and other companies whose activities are not easily traced to single countries.

The OECD report said: "Gaps and mismatches in the current, outdated tax rules can make profits 'disappear' for tax purposes, or allow the shifting of profits to no-or low-tax locations where the business has little or no economic activity".

Although there are few reliable estimates of these practices - also known as base erosion and profit shifting (BEPS) - they are thought to have contributed to billions of dollars of tax avoidance by leading multinationals.

According to one calculation, there is more than $2trn held by US multinationals in offshore financial centres which, at a 30% tax rate, would be equivalent to around $700bn in missing government revenue.

The reports suggests this money could be used support the fragile economic recovery after years of austerity and "social hardship".

Although such tax avoidance is legal, the report says taxpayer trust has been damaged by these practices.

The OECD says the measures are aimed at promoting the "spirit of the law - not just the letter".

They were described by auditors PwC as "the most significant change to international tax in modern times".

The proposals, which are long and complex, aim to close numerous loopholes in domestic and international laws which allow companies to shift such profits around the world, using a variety of financial instruments.

"The BEPS Project marks a turning point in the history of international co-operation on taxation", the report said.

However, it is likely to be some years before the plans come to fruition. A second half of the report, including more proposals, is due next year. The plans will need then to be approved by the G20, before individual governments have an opportunity to implement them.

00.25 | 0 komentar | Read More