PRESS DIGEST - British business - August 21

Saturday, 21 August 2010

The Times

SILENCE IN DRUG DEAL

Silence Therapeutics (SLN.L), the pharmaceutical company that is utilising RNAi technology, has announced that its partner Quark Pharmaceuticals has signed a deal with Novartis. The exclusive deal will enable the development of a drug which will prevent acute kidney injury for patients undergoing cardiac surgery. The market reacted to the announcement with a 14 percent increase in its share price.

NEW BLOW FOR OCADO

Online grocery retailer Ocado saw its shares fall 3.25 pence on Friday to a new low of 134 pence. Shares in the retailer are now worth less than half of the 270 pence price tag which was at the top of the range originally proposed before the company's recent initial public offering.

NEED TO KNOW: NBNK INVESTMENTS

NBNK Investments, a new banking venture planning to operate as many as 600 UK branches, has raised 50 million pounds ($77.75 million) via a stock market listing. The money will be used to acquire branches from existing banks and NBNK expects to make its first acquisition within the next 18 months.

NEED TO KNOW: AVIVA

The country's largest insurance provider Aviva (AV.L) has renewed its agreement with Santander SANS.MC to underwrite insurance policies sold through the Spanish group's UK branch network.

NEED TO KNOW: BAA

Airport operator BAA FER1.MC has successfully negotiated a 625 million pound lending facility with eight banks and has pledged to repay a significant proportion of its borrowings in September. Initially BAA had aimed for a deal for 500 million pounds but quickly reported "excess demand from banks." The company has hailed the agreement as enabling it to make significant headway to refinance 1.57 billion pounds of its subordinated debt.

The Daily Telegraph

M&B SELLS 333 PUBS TO PUNCH FOUNDERS

Mitchells & Butlers (MAB.L) plans to sell 333 pubs to Stonegate, a new company set up by private equity group TDR Capital, for 373 million pounds cash. The move comes as M&B plans to focus on pub restaurants. The pubs for sale are drink-focused sites that saw a 21 percent drop in earnings before interest, taxes, depreciation and amortisation over the past two years as a result of the smoking ban and a drop in disposable income. Analysts said the pubs were sold for less than their net asset value, but M&B's chief executive Adam Fowle said the sale would enable the company to buy and build pubs that focus on food.

LOOKING DOWN: CITY'S TOWER 42 TAKEN OFF THE MARKET

Tower 42 Estate, which is made up of funds managed by BlackRock, Hermes OHV2.L and LaSalle Investment Management, has withdrawn London's tallest occupied skyscraper from the property market. The eponymous Tower 42 was put up for sale in April with a 300 million pound price tag. On Friday its owners said that a recovery in rental values in London has led to a "new direction in strategy", which will focus on "asset management" and "value-add initiatives."

The Independent

WAL-MART VETERAN IN KEY ASDA POST

Supermarket Asda has appointed Wal-Mart (WAL.N) veteran Charles Redfield as its new chief merchandising officer. Redfield, who is the senior vice-president for food and beverage at Sam's Club, Walmart's US warehouse division, will begin work at Asda next month. Redfield's appointment is the first high-profile recruitment decision to be made by new Asda chief executive Andy Clarke, who took the post in May. Redfield has worked for Sam's Club for over 20 years.

SINOCHEM SET TO GATECRASH BHP'S POTASH TAKEOVER

State-owned Chinese chemicals group Sinochem has indicated that it is monitoring miner BHP Billiton's (BLT.L) hostile 25 billion pound bid for Canadian fertiliser producer Potash Corporation of Saskatchewan. Sinochem spokesman Li Qiang was quoted as saying the firm would "pay close attention" to BHP's bid, adding that Sinochem was "interested in overseas potash investment opportunities". Earlier this week, Daniel Bubis, chief investment officer of PotashCorp shareholder Tetrem Capital Management, said PotashCorp could attract interest from a Chinese bidder and that BHP may need to raise its offer from 130 dollars a share to as much as 170 dollars a share.

The Guardian

IRN-BRU HELPS STOBART KEEP TRUCKING, DESPITE RAIL SETBACKS

Haulage group Stobart (STOB.L) said that it had made a good start to the year, helped by new multimillion pound deals with drinks group AG Barr and the supermarket chain Tesco (TSCO.L). The group said first half performance was in line with expectations and "significantly ahead" of the same period last year, despite worse than expected trading at its rail division. Analysts forecast full-year pre-tax profits of 35.2 million pounds, up from last year's figure of 29.3 million.

MFI FLATPACK FURNITURE BRAND TO BE REASSEMBLED

A revival of collapsed furniture retailer MFI is expected, after the plumbing firm Walker Group purchased the rights for the MFI brand from its administrator for 250,000 pounds. The trade magazine Retail Week revealed that a deal had been agreed between Walker Group and administrator MCR for the high-street brand, which became one of the biggest casualties of the economic downturn, suffering from poor sales in homewares before collapsing in 2008. MFI has now been resurrected by Walker Group with the website mfi.co.uk, which includes the furniture retailer's trademark logo but with a "more innovative and design-led product range".

($1=.6431 Pound)