PRESS DIGEST - Financial Times - Oct 25

The Financial Times

TENSIONS DOG BUSINESS AND GREENS

The target set by the European Union that 20 percent of energy should come from renewable sources by 2020 this week re-ignited the long-running Whitehall battle between environmental campaigners and business as the two groups competed for the government's attention. The Department for Business, Enterprise and Regulatory Reform, for instance, sees the renewable energy target as a threat to investment in the nuclear industry. However, the Department for Environment, Food and Rural Affairs supports investments in both the renewable and the nuclear power sector. This week the issue has been the clash between two different systems for reducing carbon emissions.

CGT CASTS SHADOW OVER NO.10 BUSINESS COUNCIL

The ongoing row over capital gain tax has overshadowed the inaugural meeting of Gordon Brown's high-profile business council. The creation of the advisory body, which includes such business leaders as Sir Richard Branson and Sir Alan Sugar, was portrayed as evidence of Labour's willingness to listen to entrepreneurs. At the council meeting the CGT was off the scheduled agenda and the government refused to go into any details on what was discussed at the meeting.

FORMER INDEPENDENT INSURANCE EXECUTIVES JAILED

Some fomer Independent Insurance executives have been given various jail terms for their roles in causing one of the biggest corporate collapses of the decade. Michael Bright, former head of the company, was given a seven-year jail term, Dennis Lomas, former finance director, was sentenced to four years and Philip Condon, former deputy managing director, received three years for their roles in a scam that hid hundreds of millions of pounds of losses from investors, policy holders and employees. Independent Insurance's collapse in 2001 shocked the stock market.

LONDON OFFICE RENTALS SLOW

A report published by the commercial agent Colliers CRE has found net stock absorption -- the change in the amount of office space occupied over a set period of time -- fell 23 percent compared to a year ago and 21 percent since the end of 2006. The West End saw absorption down 32 percent since the end of 2006. The study, however, supports the view there is occupier demand to sustain the glut of new development completing in the next five years.

BANK WARNS UK FINANCIAL SECTOR STILL "VULNERABLE"

The Bank of England is expected to warn the UK financial system "remains vulnerable" to new shocks from the global credit squeeze and will highlight the property sector as being "particularly prone to further shocks and to rises in the cost of finance". The Bank will also finger equities as being vulnerable to a possible economic slowdown and will equally warn that the U.S. dollar may fall sharply. But the Bank will say vulnerability to new shocks will depend to a large extent on whether banks rein back lending or act as if business has gone back to normal.

MISYS TO OFFER ITS PRODUCTS FOR FREE

Misys (MSY.L) is to make its U.S. Connect healthcare software open source, making the company one of the biggest UK commercial software companies to offer its products for free. The move is part of the plans by the company to re-position itself by focusing on "software-as-a-service" where revenue comes by subscription to an online service. The strategy is also part of the attempts by chief executive Mike Laurie to transform the company's underperforming healthcare software unit.

3I JOINS RUSH INTO LUXURY GOODS

The private equity firm 3i is to acquire a 30 million dollar stake in the Bali-based jeweller John Hardy. The acquisition is the latest foray by private equity into the luxury goods sector and follows Permira's 3.5 billion dollar bid for the fashion house Valentino. John Hardy designs and markets upmarket hand-crafted jewellery at its workshop in Bali, Indonesia.

TELECITY SHARES SURGE ON RETURN TO LSE

Shares in Telecity (TCY.L) surged more than 10 percent on its return to the London Stock Exchange after a two-year absence. The shares were at Wednesday's launch priced at 220 per share, giving the company a market capitalisation of 436 million pounds. Chief executive Mike Tobin expressed delight at the high level of interest from institutional investors.

BODYCOTE ENJOYS SALES GROWTH

Bodycote International (BOY.L) has predicted most of its markets will remain buoyant for the rest of the year after forecasting that its third-quarter sales would be up nearly 20 percent. The thermal processing specialist expected revenues for the third quarter to the end of September to rise 19 percent on constant exchange rates. Its shares, however, fell 3.75 pence to 291.25 pence.

DANIEL STEWART MOUNTS RECOVERY

Shares in Daniel Stewart (DAN.L) gained 2.5 pence to 13.5 pence after the broker and adviser to small-cap companies reported pre-tax profit of 1.23 million pounds for the six months to September 30 against a loss of 280,090 pounds the last time. Chief executive Peter Shea said the company had hired nine specialist analysts covering individual sectors over the past 10 months.

Prepared for Reuters by Durrants.