PRESS DIGEST - British business - Nov CORRECTION

The Times

BMI STRUGGLES TO GET SALE OF LANDING SLOTS OFF THE GROUND

British Midland [BRSMDA.UL] could struggle to raise the 95 million pounds needed to keep flying due to a lack of potential buyers for its landing slots at Heathrow. The slots normally change hands for tens of millions of dollars each, but many of the world's top airlines, including British Airways(BAY.L) and Virgin Atlantic, are not interested. Speculation from analysts points to possible interest from an Asian carrier, but only at a bargain price. BMI needs to raise 190 million pounds by the end of October 2010 in order to survive.

RUSH TO SWAP DEBT FOR EQUITY PROMPTS LLOYDS TO CONSIDER RAISING 1.5 BILLION MORE

Lloyds Banking Group (LLOY.L) said it may increase its capital-raising by 1.5 billion pounds due to a high level of interest from investors. The increase to 22.5 billion pounds would see investors converting their tier 1 and tier 2 debt into new "contingent capital", a move that analysts estimate will cost the bank between 100 and 300 million pounds extra a year to pay the coupon. Lloyds is still targeting 13.5 billion pounds through a conventional rights issue that will be priced on Nov. 24.

REGULATOR COULD FORCE BT'S RIVALS TO HELP CARRY BURDEN OF ITS SIX BILLION POUND PENSION DEFICIT

Ofcom is to carry out an investigation into British Telecom's(BT.L) pensions costs to see if it should take them into account when billing rivals to use its network. If the move is approved the costs could be passed on to customers of groups such as Carphone Warehouse(CPW.L) and Cable & Wireless(CW.L). BT will release second-quarter figures on Thursday that are expected to show its pension deficit has narrowed to about six billion pounds, from eight billion pounds in June. Profits for the three months to September 30 are expected to fall to 236 million pounds

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The Daily Telegraph

MORE THAN 100 JOBS TO GO AT GUARDIAN

Guardian Media Group, which owns The Guardian and The Observer newspapers, has announced a review encompassing "more than 100" job cuts. Alan Rusbridger, the Guardian's editor-in-chief, told staff on Wednesday that "nine out of 10 people will still be here at the end of the review", but that cuts needed to be made. The company forecasts that newspaper revenues will fall by 33 million pounds in the current financial year. However, Guardian Media Group chief executive Carolyn McCall said "We have not, and will not, cut journalism that is fundamental to our core purpose and values."

NECTAR FINANCES HIT BY OWN SUCCESS

Nectar card owner Loyalty Management UK revealed a 28.5 million pound loss after recalculating predictions about how many customers would redeem loyalty points on the card. The recalculation, which includes a 27 million pound provision and which was undertaken after LMUK's owner Groupe Aeroplan brought in a new financial model, concerns points issued before October 2007. LMUK's chief financial officer, Mark Grafton, said the recalculation did not indicate that shoppers were redeeming more points in the recession.

PROPERTY HELPS ADVERTISING DECLINE TO SLOW AT JOHNSTON

John Fry, the chief executive of Johnston Press, has said that a downturn in recruitment advertising has been offset by improved property advertising sales. The regional newspaper owner's advertising sales are now down 22 percent on last year, compared with 33 percent on last year in the first six months of 2009. Mr Fry said that the results showed improved stability, but that there were no guarantees that the advertising slump had ended. Johnston is now confident of meeting market expectations for 2009 by delivering an operating profit of about 62 million pounds.

The Independent

SAINSBURY'S BOSS WARNS AGAINST VAT ON FOOD AS PROFITS JUMP

Justin King, the chief executive of Sainsbury's(SBRY.L), has said that the next government could hurt Britain's poorest people if it imposes VAT on food sales. Last week, Sir Stuart Rose, the executive chairman of Marks and Spencer(MKS.L), said that VAT may have to increase to 20 percent by the next government. King made his remarks after revealing an 18.5 per cent rise in underlying half-year pre-tax profits to 307 million pounds. The increase in profits comes after Sainsbury's non-food lines performed strongly and shoppers spent more than average.

GREGGS LOOKS AT THRESHERS' STORES TO DRIVE EXPANSION

Bakery chain Greggs(GRG.L) is considering buying around 100 shops formerly owned by First Quench Retailing, the owner of Threshers which went into administration last month. Greggs' chief executive Ken McMeikan said that he was looking to acquire under 10 percent of FQR's estate, and that the figure could yet be reduced if outlets were unsuitable. Greggs plans to open more than 600 shops in the medium term. First Quench Retailing has an estate made up of 1200 properties, and five main bidders are said to be interested.

US DRUGS BOARD APPROVES GSK'S SWINE FLU VACCINE

GlaxoSmithKline(GSK.L) is set to ship 7.6 million doses of its swine flu vaccine to America after the U.S. Food and Drug Administration approved the treatment. GSK now needs to provide the FDA with information about an outside contractor that fills vials for the company, but has confirmed that the vaccine will be ready by the end of the year. The vaccine is not the same as GSK's Pandemrix treatment. GSK declined to comment on how much the US will pay for the vaccine, but is understood to charge clients based on a sliding scale, with developed countries at the top.

REED ELSEVIER CHIEF LEAVES AFTER EIGHT MONTHS

Ian Smith, the chief executive of Reed Elsevier(REL.L), has resigned after just eight months in the job. He is expected to receive a payout between 1.1 million and 1.5 million pounds if he fails to find a new post within the next year. The company denied a boardroom split and said it was mutually agreed that Mr Smith was not the right man to head the company in the current economic climate. Mr Smith had no previous experience of running a media business when he was appointed in March.

SCOTTISH & SOUTHERN SEES SHARP RISE IN PROFITS

Scottish & Southern Energy(SSE.L) reported a 36 per cent rise in profits to 410.5 million pounds, but said it could not promise any price cuts. The company, which owns Southern Electric, Swalec and Scottish Hydro Electric and has nine million customers, said its main gas supply business traded at a loss in the half year, and that higher annual wholesale prices and increasing distribution and environmental costs put extra pressure on the business.

360 MILLION POUND NATIONAL EXPRESS CASH CALL GOES AHEAD

National Express(NEX.L) has announced a 360 million pound rights issue without the support of the Cosmen family, its largest shareholder with an 18 percent share. The cash call is fully underwritten and supported by institutional shareholders including M&G, its second largest shareholder with a stake of 12.5 per cent. The Cosmen family said it was "not in the best interests" of the company and breached the limit it was willing to pay. If the family fail to subscribe they will lose their right to a seat on the board as their shareholding would be diluted to about 5.6 percent.

Prepared for Reuters by Durrants