PRESS DIGEST - British business - June 7

Mail on Sunday

ONLINE STORE IS ALL THE FASHION IN A DOWNTURN

M and M Direct has reported a rise in sales of 29 percent in the 12 months to February, contributing to a growth of over a fifth in profits to 10 million pounds ($16.05 million). The online retailer buys excess, rather than old season, stock from other retailers and brands, which has paid dividends in the recession. "I would never be so bold as to say we are immune to what is happening," remarked the chief executive Stephen Robinson. "But because we sell discounted shopping we are clearly at an advantage."

WATER CHIEFS IN PLEA FOR A BIG PRICE SHAKE-UP

Senior executives at two British water companies have urged the water regulator Ofwat to reform the current five-yearly pricing review, claiming that it is unnecessarily expensive and complicated. John Cuthbert, managing director of Northumbrian Water(NWG.L), said that a longer period between pricing reviews would encourage water companies to make savings further into the future and reduce price volatility. Tony Wray, chief executive of Severn Trent(SVT.L), stated improvements could be made in the efficiency of the present system of water regulation.

BANK STAKE BOSSES SNUB PENSION PLEA

UK Financial Investments, the government body set up to manage the taxpayers' stake in partially-nationalised British banks, will not step in if the final-salary pension schemes at Lloyds Banking Group(LLOY.L) and Royal Bank of Scotland(RBS.L) are scrapped for existing members. After a week in which a number of major institutions, including Barclays Bank(BARC.L), stopped their final-salary schemes, unions are becoming increasingly concerned that Lloyds and RBS will be next. However, spokesmen for the banks claimed that there were no plans to axe their schemes at this time.

The Sunday Times

CARPHONE AND VODAFONE RECONNECT

A three-year dispute between Vodafone(VOD.L) and Carphone Warehouse(CPW.L) looks set to end, with an announcement expected that Vodafone will resurrect a sales agreement with the telecoms store chain. Carphone head, Charles Dunstone, is thought to be in advanced talks with Vodafone over a deal which would see Vodafone mobile contracts sold at Carphone's 800 UK store for the first time since 2006. A joint venture between Carphone and US electrics retailer Best Buy will be known as Best Buy Europe from July 2010.

SKIPTON BUILDS UP WAR CHEST

Skipton Building Society, Britain's sixth-largest, is considering a sale of at least three non-core assets in order to raise up to 40 million pounds to fund rescue takeovers of struggling rivals. Credit checking agency Callcredit, estate agents Connells and mortgage-servicing business HML are all likely candidates for disposal. The Financial Services Authority is currently stress-testing Britain's biggest building societies, with Skipton thought to be one of the regulator's favoured homes for other struggling societies.