PRESS DIGEST - Financial Times - Jan 6

The Financial Times

BUSINESS LEADERS WELCOME BROWN PLEDGE TO CREATE JOBS

Prime Minister Gordon Brown's pledge to create "as many as 100,000 new jobs" by boosting public spending has been welcomed by business leaders who expect more details at a summit called for next Monday. David Frost, director general of the British Chambers of Commerce, said any move aimed at helping with the worrying employment figures was a "positive step" but that "we need to see the detail behind the 100,000 new jobs figure". Stephen Rafley, chief economist at the EEF, representing manufacturing employers, said the move "will improve job prospects for a lot of skilled workers". David Coats, director of policy at the Work Foundation, said increasing public spending to generate extra employment was "the right approach".

CONSTRUCTION INDUSTRY CONTRACTS SHARPLY

New figures by a Cips/Markit survey have highlighted the deepening problems of the UK's construction industry as commercial building activity slumped to 29.3 in December, with 50 being the level indicating contraction, amid companies' concerns over the current financial slowdown. The housing sector saw the biggest decline, reaching 23.8 compared with a peak of more than 60 in June 2007, while commercial construction dived to 26.3, a record low. The research also found a record drop in new orders for work while the industry faced job cuts for the seventh consecutive month.

BOOKIES FACE LEVY TO TREAT PROBLEM GAMBLING

The UK's larger betting groups are to continue being the main supporters of the annual five million pounds fund for research and to treat problem gambling under new government plans to be announced on Tuesday. As discussions over the introduction of a voluntary levy by the gambling industry came to nothing, the Department for Culture, Media and Sport is suggesting that bigger online operators pay some 92,000 pounds to 145,000 pounds a year for the next three years. Bookmakers with more than one 100 outlets will contribute up to 36,000 pounds and the biggest bingo operator up to 77,000 pounds.

EDF CALLS ON UK TO DECLARE NEED FOR NUCLEAR POWER

EDF (EDF.PA) has said the building of new nuclear power stations in the UK will be delayed unless the government restructures its planning and safety approval process. The French energy group finalised on Monday its 12.5 billion pounds takeover of British Energy BGY.L, operator of eight nuclear power plants in Britain. Pierre Gadonneix, EDF chief executive, said the UK still needed to create a "fluent" regulatory environment and that the company was open to other groups taking stakes in its new nuclear venture in the UK. "Centrica (CNA.L) can be a partner, but it is not the only one for new nuclear," he said.

FOUR SEASONS SAYS DEBT RESTRUCTURING REMAINS ITS PLAN

The board of Four Seasons Healthcare, the ailing care homes operator, has said it does not support a merger proposal from Priory Group, adding that it is committed to the "consensual restructuring" of its 1.5 billion pounds of debt. It believes the move is backed by the majority of its lenders while sources close to the debt negotiations believe that a debt-for-equity restructuring would leave the group with about 900 million pounds in debt. Despite its balance sheet problems, Four Seasons remains confident over its operational performance. Chief executive Pete Calveley said: "Trading is excellent. We're having the best year we've ever had."

LLOYDS TO RETAIN MIDDLE-TIER HBOS EXECUTIVES

Lloyds TSB (LLOY.L) is to give a number of senior roles to HBOS HBOS.L executives when it completes the acquisition of the UK's biggest mortgage lender in January. Dan Watkins, an HBOS board director and head of retail products will be appointed as chief executive of mortgages in the new bank, while Peter Jackson, head of products for retail banking, will become managing director of consumer banking. In November, Lloyds said that only two of the top 11 management jobs in the combined group would go to HBOS executives, a move that indicated a caution approach on lending.

CARPETRIGHT SET TO VACUUM UP RIVALS

Flooring retailer Carpetright (CATVU.L) is considering medium-term growth plans as chairman and chief executive Lord Harris of Peckham said the group, which has been hit by a sharp drop in sales, could buy businesses, including Topps Tiles, after a year of consolidation and cutting debt. In November, the group issued a profits warning while its shares have posted a 60 percent dive in the past 12 months, closing at 350 pence on Monday and leaving it with a market value of 238 million pounds. Carpetright is far from immune to the economic downturn as its declining like-for-like sales and the strengthening of euro are expected to have a significant effect on its full-year profits.

SALES DROOP AT RESTAURANT GROUP

Restaurant Group (RTN.L) said it expected to meet market expectations when it announces its annual results in March despite posting an almost five percent drop in like-for-like sales over the last seven weeks of 2008. Overall like-for-like sales in the 52 weeks to December 28 increased 1.5 percent, but had been up 2.5 percent in the 45 weeks to November 9. Analysts said they remained confident that despite the "disappointing" slowdown the group would prove to be more resilient than many of its rivals. Shares in the company, which owns the Garfunkel's and Frankie & Benny's chains, firmed 1.50 pence to 107 pence.

VOLVO TIE-UP WITH CLEAN AIR POWER

Clean Air Power (CAPC.L), the producer of equipment that enables trucks to run on a blend of liquefied natural gas and diesel, has announced a deal with Volvo Powertrain, sending its shares up 14 percent to 14.50 pence. The Aim-listed group expects a formal contract to be signed later in 2009 and hopes that by the last three months of this year hauliers would be able to buy Volvo trucks making use of the dual fuel system, which reduces costs by one fifth and cuts greenhouse emissions.

INSOLVENCY EXPERT CHAIRS ENNSTONE

Beleaguered construction materials firm Ennstone ENN.L has appointed Julian Cooper, a senior partner at restructuring group MPC Partners, as its new executive chairman. Cooper, a specialist in insolvency and restructuring, will replace Graham Brown, who has acted as interim executive chairman since Vaughan McLeod, Ennstone's founder, announced his resignation in September. The group, which saw its shares dive 99 percent in 2008, has been severely hit by the downturn in the construction industry and by the heaviness of the 200 million pounds debt it obtained following its acquisitions in the United States and Poland. The shares closed up 0.06 pence at 0.4 pence.

Prepared for Reuters by Durrants.