PRESS DIGEST - British business - March 21

The Times

PUNCH CALLS TIME ON 1,000 PUBS AHEAD OF SMOKE BAN

Punch Taverns (PUB.L) is to put up to one thousand of the smaller pubs in its 9,300-strong chain up for sale ahead of the imminent smoking ban. This follows the example of many of its rivals which have already sold or are putting up for sale the smaller venues they feel would be less able to mitigate against the ban's effects by increased food sales.

OFCOM LAUNCHES INQUIRY INTO BSKYB

Ofcom said yesterday it was beginning a detailed investigation into the pay-television market under the Enterprise Act following complaints from Virgin Media (VMED.O) and BT (BT.L) among others that BSkyB (BSY.L) may be in breach of competition law. The complainants say Sky has an 80 percent share of the market, allowing it to charge prices higher than those of overseas markets.

BNFL IN TALKS ON TWO BILLION POUND URANIUM STAKE SALE

British Nuclear Fuels Limited is in talks with uranium enricher Urenco to sell its one-third stake in the company for up to two billion pounds. The demand for enrichment services has been pushed up by high uranium prices, which helped Urenco lift net profits for 2006 to 209 million euros, with its order book increasing to 15 billion euros. Analysts believe the stake, if sold, could raise about two billion pounds.

The Daily Telegraph

U.S. EXPLOSION REPORT POINTS TO BP'S BOARD

The U.S. Chemical Safety Board has published the findings of an investigation into why BP's (BP.L) Texas City oil refinery exploded in March 2005, killing 15 workers and injuring hundreds. BP had cut the budget at the facility by 25 percent in 1999 and despite seven safety warnings being issued to senior BP executives since 2002 did so again in 2004. The investigators found that before the explosion, safety equipment was faulty and safety procedures were not being followed.

BARCLAYS MOVING HQ TO HOLLAND IF ABN DEAL SUCCEEDS

Barclays (BARC.L) is prepared to transfer its headquarters from London to Amsterdam if it merges with Dutch bank ABN Amro AAH.AS. In exchange for this concession, Barclays will expect management control of the merged entity and to keep its primary listing in London. The new chief executive is expected to be Barclays's John Varley. Analysts are viewing the move to Amsterdam as merely symbolic, and many believe the merger amounts to a Barclays takeover. Barclays share price rose 25 pence to 702 pence.

FRIENDS PROVIDENT PROFIT HIT BY F&C LOSSES

Friends Provident FP.L announced a three percent decline in underlying pre-tax profits to 509 million pounds for 2006. This fall was attributed to the poor performance of F&C Asset Management, of which Friends Provident owns 51 percent. F&C recorded pre-tax losses of 30.6 million pounds, partly as a result of the loss of billions of pounds of assets belonging to Resolution Life, which decided to manage them itself. However, Friends Provident did record solid figures for its life and pensions operation, with sales of these products reaching 4.16 billion pounds.

The Independent

ICI BOSS PAID 2.7 MILLION POUNDS IN A YEAR

The chief executive of ICI ICI.L, John McAdam, received 1.3 million pounds in salary and bonus in 2006, and 1.4 million pounds in ICI shares. The generosity of the remuneration resulted from McAdam achieving various performance targets. In addition, 1.35 million pounds was paid into his pension pot, taking it to 10.6 million pounds.

MACDONALD STEPS DOWN AS HEAD OF MENZIES AND WILL NOT BE REPLACED

John Menzies (MNZS.L) announced a three percent decrease in annual pre-tax profits, despite its revenues increasing by six percent to 1.5 billion pounds. In addition, the group's chief executive Patrick Macdonald has resigned and will not be replaced. Instead, John Menzies's two divisions, which handle aviation and distribution, will be run separately. A spokesman said: "The two divisional managing directors are young and ambitious guys and the central role of chief executive is no longer needed."

The Guardian

TEN BILLION POUND CROSSRAIL LINE UNDER LONDON LIKELY TO BE FUNDED BY BUSINESS LEVY

Former Audit Commission chairman Sir Michael Lyons is expected to announce a bold plan for the extra cash to be needed to kick-start the long-delayed 10 billion pound Crossrail project to be provided by businesses. Sir Michael is expected to urge that powers be given to London Mayor Ken Livingstone to levy a supplemental business rate of between 1.5 pence and three pence.

BLAIR'S ATTEMPT TO AMEND AVIATION DEAL LIKELY TO FAIL

According to sources within the airline industry, Tony Blair's attempt to win a more favourable settlement for the UK in the open skies pact before tomorrow's vote on the deal is doomed to failure. While Britain wants a five-month hiatus before Heathrow is opened up to all U.S. carriers, it is understood EU ministers want the agreement implemented as soon as possible.

Prepared for Reuters by Durrants