PRESS DIGEST - Financial Times - April 15
GLOBAL ACCOUNTING RULES DEADLINE UNDER THREAT
The International Accounting Standards Board and the U.S. Financial Accounting Standards Board have said they may fail to meet the June 2011 deadline for agreeing a single global set of accounting rules. A move towards converging the U.S. Generally Acceptable Accounting Principle and the International Financial Reporting Standards, used outside of the United States, was supported by the Group of 20 leading economies in September 2009, to improve capital flows and reduce cross-border arbitrage. But in a joint statement the two accounting standards bodies said that while they have successfully agreed on five main issues, there was "no guarantee" they would be able to resolve all, or any, of their differences on financial instruments.
RECRUITMENT IN CITY REACHES 18-MONTH HIGH
City recruitment has recovered to levels not seen since the collapse of Lehman Brothers 18 months ago. There is some sentiment that recruitment levels could reach pre-credit crisis levels within months and leading financial recruitment firm Morgan McKinley reports that the average City salary rose by eight percent to 55,689 pounds in March compared with February. The recovery in City recruitment is not expected to be mirrored in the overall UK jobs market however, and there is concern that public sector job cuts over the next 18 months could hinder the economic recovery.
HOTEL GROUP TO CREATE 3,500 JOBS
InterContinental Hotels Group (IHG.L) has signalled plans to create 3,500 jobs over the coming three years as part of expansion plans, which will see the hotel company open 36 new hotels in the UK. Globally, expansion of the hotel company will see more than 100,000 jobs created during the same timeframe, as it opens 1,400 hotels. Chief executive Andy Cosslett said a "commitment from the government to support and promote the tourism industry" would help InterContinental to create even more jobs, in addition to the 3,500 opportunities it plans to create in the UK over the next three years.
BP DISMISSES CONCERNS TO PRESS ON WITH CANADA OIL SANDS PLAN
Energy company BP (BP.L) will announce its intention to proceed with plans to invest in Canada's controversial oil sands at its annual general meeting today, despite protests by environmentalists and shareholder concerns. The meeting is expected to be the first test of the opposition to exploiting Canada's oil sands, which has so far resulted in more than 140 investors backing a resolution calling for a review. Similar opposition is also anticipated at Royal Dutch Shell (RDSa.L) as it discloses its plans in the coming weeks. In BP's annual sustainability report, chief executive Tony Hayward, who is also expected to face investor scrutiny over his 41 percent rise in remuneration, said greenhouse gas emissions are lower for some oil sands projects than in some types of conventional oil production.
PRU SEEKS MINORITY INVESTORS FOR AIA TO EASE CURBS
Insurer Prudential (PRU.L) plans to bring minority investors into some of the Asian businesses it wants to acquire from rival AIG (AIG.N), in a bid to ease capital curbs imposed by local regulators. According to AIG's recent filings, Asian regulators have restricted loans and advances to the U.S. insurer from subsidiaries of AIA, its Asian arm, with analysts estimating that over three billion dollars could be trapped in AIA units. However, sources familiar with Prudential's thinking say the restrictions could be eased in China, Thailand and Malaysia by the sale of locally held minority stakes to investors.
BIDDERS LINE UP FOR HSBC TRAIN LEASING ARM
As banks attempt to dispose of non-core assets in order to bolster their balance sheets, private equity and specialist infrastructure investors are expected to be the most heavily featured among a host of bidders for HSBC Rail, HSBC's (HSBA.L) train leasing business. The sale comes as the rail leasing market struggles to recover, after a Competition Commission investigation led to the Department for Transport deciding to buy and lease trains itself in the future, effectively cutting leasing companies out of the market for new trains. The auction is being run by Rothschild, along with HSBC's own advisory team, and the business is expected to be valued at around two billion pounds.
JD SPORTS PUSHES UP DIVIDEND PACE
High street retailer JD Sports Fashion (JD.L) has increased its final dividend by 65 percent after its performance beat analysts' full-year forecasts. Executive chairman Peter Cowgill said the retailer was considering further European acquisitions, adding that the firm had "the opportunity to be selective". Christmas trading helped to boost pre-tax profits 61 percent from 38.2 million pounds to 61.4 million pounds, while total sales rose 15 percent to 769.8 million pounds. JD Sports increased its dividend from 8.9 pence to 14.7 pence. Shares closed down 10.5 pence at 723 pence after rising 13 percent in the last week.
STRONG DEMAND FOR CREDIT HELPS IPF BOUNCE BACK
International Personal Finance (IPF.L), which lends small amounts of money to borrowers in emerging markets such as Poland, Hungary and Mexico, returned to profit in the first quarter of the year because of higher demand for credit in central Europe. After generating a loss of 8.5 million pounds during the first quarter of 2009, the group announced a pre-tax profit of two million pounds this time. IPF chief executive John Harnett said he expected full-year pre-tax profit to be about 85 million pounds this year, compared with 62 million pounds in 2009.
PERMIRA CHAIRMAN TO JOIN NEW BOARDS
Outgoing Permira [PERM.UL] chairman Damon Buffini is to join the boards of German fashion group Hugo Boss BOSG_p.DE and set top box maker NDS. The move gives Buffini, who steps down from his role at the private equity firm in June, a controlling voice at two of Permira's best known portfolio companies. After nearly a decade running Permira, Buffini became chairman in 2007, stepping into a position created for him and handing over as managing partner to Kurt Bjorklund and Tom Lister. A replacement chairman will not be sought and Buffini will remain a member of the firm's investment committee.
POLE POSITION: JAEGER TARGETS YOUNGER SHOPPERS
Jaeger is to launch its first fashion line specifically aimed at young shoppers. The privately owned fashion chain's Boutique by Jaeger range is aimed at shoppers aged 20-25 and is intended to compete with high street rivals, such as Whistles and Reiss. The line will also carry diffusion ranges such as Marc by Marc Jacobs and See by Chloe. Jaeger's strategy reflects the importance retailers are placing on younger consumers, whose spending patterns have remained relatively resilient through the economic downturn.
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