PRESS DIGEST - British business - April 14

The Times

TESCO GREEN FUEL "ADDS TO CLIMATE CHANGE"

Greenpeace said an investigation found Tesco (TSCO.L) is making false statements about the source of the green fuel sold at its service stations. The investigation found 30 percent of the biofuel in Tesco diesel came from palm oil. Tesco initially denied using any palm oil in its diesel and said it shares concerns about the environmental danger done by the oil. However, when pressed, a spokesman for the company acknowledged small amounts of palm oil might be used in some parts of the country.

MEDIA SPLASHES OUT TO REACH PUBLIC SERVICE AUDIENCE ONLINE

A study carried out by Ofcom has found newspapers and broadcasters are spending a third of a billion pounds a year on high-quality "public service" Internet content. The biggest media contributor is the BBC spending 116 million pounds on bbc.co.uk in the 2006-07 financial year. ITV, Channel 4 and Five spent a further 13 million to 14 million pounds each. Newspapers and Sky News spent 200 million pounds.

The Daily Telegraph

LIBERTY READY TO REEL IN VIRGIN CHANNELS

Liberty Global (LBTYA.O) is considering a bid for Virgin Media's (VMED.O) television channels. Neil Berkett, Virgin Media's chief executive, has asked Goldman Sachs to review its channels business, valued at 800 million pounds. Shane O'Neill, chief strategy officer at Liberty Global and head of its European channels group Chellomedia, said: "If it came on the market we would be duty bound to have a good look at it."

TWO-HORSE RACE FOR BRITISH ENERGY

The German and French energy giants RWE (RWEG.DE) and EDF (EDF.PA) remain the frontrunners in the battle to buy British Energy BGY.L, despite the emergence of new potential bidders which include Swedish power group Vattenfall [VATN.UL]. The two-horse race may seriously undermine the possibility of Centrica (CNA.L), the UK's only serious contender in the race, playing any part. Competition issues over market share are set to limit Centrica to playing a watered-down role in any takeover.

ALROV SIGNS REGENT STREET DEAL

A new six-star hotel is set to open in London after Alrov Properties signed a 90 million pound deal on Sunday to buy the Regent Street building that houses the Cafe Royal. Alrov plans to turn the building into a 160-room hotel. However, the development, which is understood to part of a regeneration of Regent Street being undertaken by The Crown Estate, could spell the end of the line for the 142-year-old Cafe Royal.

The Independent

CRITICISM GROWS OF M&S'S PLAN FOR ROSE PROMOTION

The Local Authority Pension Fund Forum has joined the growing list of critics of the plan by Marks & Spencer (MKS.L) to promote its chief executive Sir Stuart Rose to the post of executive chairman. The LAPFF has written to the retailer asking it to rethink its plans which contravene the Combined Code on corporate governance, saying it had failed to convince it of the necessity of Rose's promotion.

M&B SHOWS SPIRIT IN TALKS WITH PUNCH

Just two weeks after merger talks were abandoned, Mitchells & Butlers (MAB.L) is considering buying part of Punch Taverns (PUB.L). M&B is interested in Punch's Spirit managed pubs business, which would fit well with its existing estate. In order to fund the purchase, M&B has opened up its books to Permira, Bain Capital and a consortium of CVC and Blackstone with a view to selling a slice of its own business.

THE WEEK AHEAD

On Tuesday, Burberry (BRBY.L) is due to publish a trading statement for the six months to March 31. JP Morgan analysts predict underlying sales growth of 17 percent for the period, implying a deceleration to eight percent growth in the fourth quarter, down from 26 percent growth for the third quarter

The Guardian

AIRLINES ANGER AT BAA AFTER BRITISH AIRWAYS POSTPONES MOVE

BAA is this week preparing for further criticism of its handling of the opening of Heathrow's Terminal 5 at a crisis summit for airlines whose plans for expansion have been thrown into disarray. BAA was criticised by BMI last week for agreeing to let British Airways (BAY.L) delay its full transfer from Terminal 4 to T5. BMI has said carriers at Heathrow that had drawn up plans to move into new bases at Terminal 4 had not been consulted.

TESCO PLANS TO COUNTER CLAIMS OVER FRESH & EASY VENTURE

Tesco (TSCO.L) will this week seek to allay investors' fears that its U.S. Fresh & Easy venture has run into difficulties. Alarm bells started ringing among investors and analysts last month when expansion plans for Fresh & Easy were put on hold. Tesco has so far opened 60 Fresh & Easy stores and says it now wants to give the business time to "settle down". The supermarket chain is expected to report annual profits of 2.8 billion pounds on Tuesday but will not give breakdown sales for the Fresh & Easy stores.

BRADFORD & BINGLEY DENIES RIGHTS ISSUE REPORT

Market attention will be focused on Bradford & Bingley BB.L on Monday after weekend reports said the mortgage lender is planning a rights issue to bolster its financial position. Analysts regard Bradford & Bingley as being heavily reliant on the wholesale debt markets for funding, and therefore likely to be looking to raise finance from other sources. Bradford & Bingley has moved quickly, however, to contain the speculation by issuing a statement denying plans for a rights issue.

Prepared for Reuters by Durrants