PRESS DIGEST - British business - Nov 13

The Times

BA AND IBERIA MERGER CLEARED FOR TAKE-OFF

British Airways(BAY.L) and Iberia (IBLA.MC) have agreed a merger deal that will create Europe's largest airline. The deal is expected to trigger cost saving measures at both airlines with job losses at head offices in London and Madrid, maintenance facilities and among sales staff. The value of the combined airline will be 4.5 billion pounds ($7.46 billion). BA shareholders will control 56 percent of the new group and Iberia the rest. Under the terms of the deal, BA will be incorporated in Madrid, but the headquarters and stock market listing will be in London. BA's Chief Executive Willie Walsh will head the merged group.

CAUTIOUS 3I TURNS ITS BACK ON NEW INVESTMENTS

Private equity group 3i(III.L) said it has not made a single new company investment in the past six months as uncertainty about the real value of assets made investors cautious. Chief Executive Michael Queen said it was the quietest period for new investment since he joined the group in 1987. However, 3i was confident investment volumes would pick up in the next year and it had put aside two billion pounds to make acquisitions in traditional buyouts, growth companies and infrastructure deals.

ENTREPRENEURS ACCUSE RUTLAND OF CONTRACT BREACH

Two entrepreneurs, Paul Vercoe and John Pratt, have accused Rutland Partners, a private equity firm, of pushing them aside after they presented the group with a business plan to buy and expand Harvey & Thompson, a private pawnbroker. The pair say that in return for the plan, they would be given senior positions and equity stakes in the business once the takeover was complete. The High Court was told that Rutland committed a breach of contract and confidence when they acquired Harvey & Thompson "without the slightest regard" to its obligations to Vercoe and Pratt.

TEMPUS:

Serco(SRP.L) (short-term investors should pause for thought)

Amec(AMEC.L) (stand aside)

Synergy Healthcare(SYR.L) (buy on weakness)

The Daily Telegraph