PRESS DIGEST - British business - Dec 3

The Times

EDF MAY SELL CAPACITY TO WIN BRITISH ENERGY DEAL

EDF (EDF.PA) may be forced to auction a part of its UK power-generating capacity in order to clear competition hurdles facing its proposed takeover of British Energy BGY.L. On Tuesday, the European Commission extended a deadline for its competition review of Britain's nuclear generator after regulators found fault with certain elements of the deal which critics claim could harm British consumers by giving EDF a stranglehold over Britain's wholesale electricity markets.

STOBART TO BUY SOUTHEND AIRPORT AS SOUTHERN BASE

Stobart Group (STOB.L), the Carlisle-based transport company, is buying Southend airport in a 21 million pound deal which it hopes will enable the airport to become a niche air-freight destination, particularly for high-value goods. Stobart's chief executive, Andrew Tinkler, said that work would start almost immediately on building a railway station at the site. The line will take passengers into London's Liverpool Street Station in 49 minutes, putting it into competition with Stansted airport.

UNIQLO SHOPS AROUND

It is believed that the Japanese clothing chain Uniqlo is considering acquisitions in Britain, where it already has a retail foothold, and in the United States, where asset prices have fallen. Fast Retailing, Uniqlo's parent company, said that same-store sales had soared by 32 per cent in November. The strength of the yen is expected to accelerate expansion plans.

The Daily Telegraph

BA STARTS MERGER TALKS WITH QANTAS

British Airways (BAY.L) has begun merger talks with Australia's Qantas (QAN.AX) in a move to create a dual-listed company with 15.7 billion pounds of annual revenues. The move has surprised the industry because BA is already in all-share merger talks with Iberia (IBLA.MC) of Spain and is seeking anti-trust immunity for a tie-up with American Airlines. All four of the airlines are part of the Oneworld alliance, which also includes Cathay Pacific which has long been a rumoured merger partner for BA. Willie Walsh, BA's chief executive, said that Qantas instigated the talks in August.