PRESS DIGEST - Financial Times - Nov 10

SCOTTISH BANKERS ASK INVESTORS TO PRESERVE HBOS INDEPENDENCE

Sir Peter Burt and Sir George Mathewson, formerly chief executives of Bank of Scotland and Royal Bank of Scotland (RBS.L), have announced their intention to discuss the removal of the present management of HBOS HBOS.L with large investors, as well as creating a website to communicate directly with the bank's 2 million smaller shareholders. "Given their management of the business, which has led to the current status, the board has lost the right to ask for the shareholders' trust", stated Burt. An independent HBOS, however, would need more cash to survive than the 11.5 billion pounds it is being lent by the government.

HIGH COURT BLOW FOR HOMEOWNERS

A High Court case has set a precedent by which mortgage lenders can now sell the homes of borrowers in arrears without needing to obtain a court order. The ruling dismissed the human rights of the homeowners and supported the right of the lender, GMAC-RFC, to appoint receivers and auction the property. The homeowners were then evicted for trespassing by the new owners, Horsham Properties. Conventional lenders are unlikely to resort to these measures, as they have a general policy of seeking repossession orders from judges, but lawyers and opposition politicians expressed their concern over the wide-reaching implications of this case.

AEROSPACE MANUFACTURERS WIN RECORD ORDERS BUT SALES GROWTH.

A survey from the Society of British Aerospace Companies has reported that orders for UK aerospace and defence manufacturers remained resilient during 2007, rising by 65 percent. However, total sales only increased by 1.01 percent to 19.84 billion pounds on the previous year due to the weakness of the dollar against the pound. The society's chief executive Ian Godden expressed his pleasure at the results, but warned that the worldwide financial crisis would certainly start to affect the sector in the near future.

COMPANIES IN DARK OVER LITIGATION COSTS

Despite the credit crisis bringing on a large number of high-level business lawsuits, an Ipsos Mori survey conducted by Addleshaw Goddard has revealed that around half of FTSE 350 executives have little idea of how to keep down the costs of litigation. Many interviewees remain ignorant of cost-cutting options when engaged in a legal dispute, such as "after the event" insurance or "third party funding". The rates for the services of lawyers at top firms can go as high as 750 pounds an hour, with even simple cases often taking a great deal of time to come to trial.

JOBLESS TOTAL SET TO SOAR TO 1.8 MILLION

Official statistics released Wednesday are expected to show unemployment at above 1.8 million, the highest level since 1998. BNP Paribas (BNPP.PA) suggests that unemployment could be up by 175,000 in the three months to the end of September. BNP's Alan Clarke says: "A measure of how bad things are is that during the early 1990s recession, there were only three occasions when the International Labour Organisation measure of unemployment showed an increase bigger than last month's 164,000 increase." The number claiming unemployment benefit is also expected to have risen by 40,000 in October, to just under 1 million.

ADVISERS HIRED TO WORK ON PREMIER SHAKE-UP

Premier Foods (PFD.L) and its main bankers, Lloyds TSB (LLOY.L) and Royal Bank of Scotland (RBS.L), have hired external advisers to work on the restructuring of Premier's debt package, which is forecast to stand at 1.7 billion pounds by the end of the year. Premier has appointed Goldman Sachs while Lloyds and RBS have brought in Deloitte, and both sides are thought to be looking at relaxing covenants, with Premier close to breaching a key covenant according to analysts.

FUND STAR RETURNS TO TAKE SILVERSTREET POST

New Star Asset Management NSAM.L co-founder Alan Miller has been installed as a partner at SilverStreet Capital, a small London-based fund of hedge funds manager. Miller had been one of the City's most prominent fund managers during spells at Jupiter and New Star, and returns to the sector after a two-year absence. SilverStreet is said to be looking at rapid expansion through acquisitions across alternative asset classes.

MACFARLANE TO LEAVE RENTOKIL

Andrew Macfarlane will early next year stand down as finance director at Rentokil Initial (RTO.L). His departure will follow those of Chief Executive Doug Flynn and Chairman Brian McGowan. Macfarlane last month oversaw a critical refinancing by raising 125 million pounds in new debt to provide greater headroom on Rentokil's debt covenants. The losses of three top jobs at the company follow a series of profit warnings, and new Chief Executive Alan Brown has warned that efforts to implement a three-year turnaround plan are being impeded by current financial conditions.