PRESS DIGEST - British business - June 6

The Times

LLOYDS TSB EXPECTS 180 MILLION POUNDS BILL FOR US BLACKLIST

Lloyds TSB(LLOY.L) will take a 180 million pound hit to its first half figures. It is preparing to pay a multi-million dollar settlement for breaking US rules on dealing with individuals or companies from a blacklist of countries believed to sponsor terrorism, including Iran, North Korea and Cuba. Lloyds TSB is already fighting a 130 million dollar action from the New York District Attorney that accuses the bank of helping to launder the proceeds from a large securities fraud.

TATE AND LYLE UNDER ATTACK FROM PARAGUAY AND INDIA

A herb used by the Guarani tribe of Paraguay wiped seven pence off Tate and Lyle(TATE.L) to 455.25 pence. Wisdom Natural Herb said that it was ready to distribute a sweetener based on the stevia leaf across America. This would cut into already weak sales of Tate's Splenda. Indian drug producer, Alkem, said that it will produce Tate's Sucralose in Europe using different techniques so it does not violate Tate's patent.

BELLWAY

The UK housebuilder, Bellway(BWY.L), said that overall house reservations were down 31 per cent on a year ago. It has also added that it had lowered its estimate for the drop in the number of homes sold this year. It now estimates the fall in sales to be between ten and 15 per cent.

The Daily Telegraph

BP CHIEF SENDS WARNING TO RUSSIA OVER PRESSURE ON VENTURE

The chief executive of BP(BP.L), Tony Hayward, has warned that Russia must respect property rights and the rule of law if its economic growth is to be maintained. Hayward said that the company was committed to Russia, as tensions mount over the future of its Russian joint venture, TNK-BP. Investors appear to have shrugged off the news with BP's shares closing up two points at 583 pence on Thursday.

DEBT FEARS BEHIND VODAFONE US DEAL

Vodafone(VOD.L) has become one of the key beneficiaries of the credit crisis after its Verizon Wireless joint venture agreed to buy mobile network Alltel for 28.1 billion dollars. With its 45 per cent stake in the venture, Vodafone is boosting its presence in the world's biggest telecoms market. Vodafone will not provide any equity as part of the transaction. Outgoing Vodafone chief executive, Arun Sarin, said the deal made sense for the joint venture.

VIRGIN WARNS ILLEGAL DOWNLOADERS

From next week, Virgin Media will send a warning to those customers whose accounts are being used to download or share music. It is the first deal between an internet service provider and a record company. The campaign is being run with the British Phonographic Industry which represents the major record labels.

The Independent

SEVERN TRENT BLAMES SCANDAL FOR 41 PER CENT FALL IN ANNUAL.

Severn Trent(SVT.L) has blamed a 41 per cent fall in profits on the fall-out of a scandal over false leakage data. The company was fined 36 million pounds this year for deliberately misleading regulators over its success in tackling leaks. It has since spent millions on improving processes and training. Severn Trent made an annual profit of 195 million pounds to the end of March.

E.ON WANTS TO BUILD UK NUCLEAR REACTORS

The German power company E.ONEONG.DE wants to build two nuclear reactors in the UK. It announced that it had joined the Nuclear Industry Association days after it issued its Energy Manifesto. It is calling on the government to have more "open and honest" talks about the UK's energy and climate change challenges. E.ON has remained on the sidelines of the bidding for British Energy BGY.L.

HALFORDS LOOKING TO BRANCH OUT IN CENTRAL EUROPE

Halfords(HFD.L) is looking to expand its stores in central Europe. The UK's "thirst" for bikes and car maintenance products drove up pre-tax profits by 11 per cent. The performance of its stores in the Czech Republic has convinced the retailer to open a store in Poland. For the year to 28 March, Halfords had total sales of 797.4 million pounds, up 7.2 per cent.

The Guardian

M&S CUTS BACK ON BOARDROOM INCENTIVES AS TRADING WORSENS

Trading conditions on the high street have deteriorated for Marks and Spencer(MKS.L). It has slashed the targets for payouts on the director incentive schemes. The retailer reported annual profits last month of more than one billion pounds for the first time since 1998. It warned that the current tough trading conditions made it difficult to achieve its targets. The earnings-per-share growth targets have been slashed by 25 per cent - 40 per cent.

SIR KEN QUERIES MORRISON'S SOUTHERN VIEW

Sir Ken Morrison attended Wm Morrison's(MRW.L) annual meeting in Bradford on Thursday in his new role as honorary president and ambassador for the supermarket. He voted against a one billion pound buyback of shares proposed by his successor Marc Bolland. A trading update released before the meeting showed it was the fastest growing retailer out of the leading supermarkets. Morrison's increased its share of the grocery market to 11.4 per cent from 11.2 per cent in the three months to May 20.

PROFITS UP AND TARGET MET AT THAMES WATER

Thames Water reported a sharp rise in profits on Thursday. This sparked a call from the consumer watchdog for it to share its success with consumers. The Consumer Council for Water said that it is essential that the success a company enjoys is shared with customers as well as shareholders. Thames Water said that operating profits rose to 590 million pounds, investment was up 28 per cent to almost one billion pounds and it had beaten the target on cutting leakage set by Ofwat.

Prepared for Reuters by Durrants