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Showing posts from June 24, 2013

Statoil finds extra 4 mln barrels of oil at Volve field in N.Sea

Statoil has found extra oil at its Volve field in the North Sea, the Norwegian Petroleum Directorate said on Monday. _0"> The firm has found an additional 3.8 million and 4.4 million barrels of recoverable oil, said the agency. Earlier this month Statoil said new drilling proved the Volve field to hold additional oil reserves in a range from 8.8 million to 9.4 million barrels, almost doubling the estimated remaining reserves at the North Sea field.   Statoil holds 59.6 percent in Volve, ExxonMobil 30.4 percent and Bayerngas Norge 10 percent of the license.

Pick-up in telecoms M&A stalls European share slide

A bumper takeover in the telecoms sector helped European shares bounce on Monday after three days of losses, although concern over the impact of stimulus withdrawal in the United States and the health of China's banks weighed. _0"> Vodafone struck its biggest deal since 2007 after it agreed to buy Germany's largest cable operator Kabel Deutschland for 7.7 billion euros, a deal which Kabel said it intended to recommend to share holders.   Kabel's shares rose 2 percent, while heavyweight Vodafone was up 0.6 percent higher. By 0706 GMT, the FTSEurofirst 300 was flat at 1.39 points at 1,132.85, having spiraled down from the year's high of 1,132.73 on May 23 exacerbated by concerns over U.S. stimulus and China's banking system. "The widespread complacency about the adjustment to the tapering environment, which suggested that equities would remain immune to the winding down of central bank support, must now have been dispelled," Ian Williams, equi

European stock 'fear gauge' hits 4-month high

The Euro STOXX 50 Volatility index, known as the VSTOXX, hit a four-month high early on Monday, signalling a sharp rise in risk aversion as mounting worries over China's banking sector kept investors on edge. _0"> The VSTOXX, Europe's widely-used gauge of investor sentiment which is based on put and call options on Euro STOXX 50 stocks , rose 3.4 percent to 24.86, a level not seen since late February.  

GLOBAL MARKETS-Dollar gains, shares fall on Fed, China worries

The U.S. central bank's plans to scale back its stimulus and fears Chinese policy may be tightening sent the dollar sharply higher on Monday, while world shares extended last week's dismal performance.   The sell-off in stocks, bonds and commodities since the Federal Reserve signalled an end to the era of cheap money that has fuelled record rises in asset prices is seen having further to run. "The prospect for a disorderly transition is there," said Josh Raymond, market strategist for City Index. Fears of further market turmoil have been exacerbated by worries over China's growth outlook and the health of its banks after the country's central bank said liquidity in its financial system is "reasonable", despite high short term rates. Amid the selling, yields on 10-year U.S. Treasury notes , a benchmark for global rates, hit a two-year high of 2.57 percent on Monday, supporting the dollar which added 0.4 percent against a basket major currencies t

UPDATE 2-Vodafone agrees $10 bln Kabel Deutschland deal

Vodafone has agreed to buy Germany's largest cable operator Kabel Deutschland for 7.7 billion euros ($10 billion), betting on TV and fixed-line services in its biggest deal since 2007.   Announcing its second major acquisition for a European fixed-line network in 12 months, Vodafone said it would pay 87 euros ($110) per share for the group to enable it to offer more competitive packages with TV, fixed-line and broadband services to its mobile customers. The world's second-largest mobile operator, following up its acquisition of Cable & Wireless Worldwide, is however paying a rich price for the German firm and its 8.5 million homes, which it considered buying before it went public in March 2010 at 22 euros per share. One trader who asked not to be named said the offer, Vodafone's biggest since a 2007 Indian acquisition, valued Kabel Deutschland at 12 times enterprise value against 2013 core earnings , a 35 percent premium to the sector. However, this falls to 8.5 t

UPDATE 3-Erste to issue shares to repay state aid, cuts outlook

Erste Group Bank will raise about 660 million euros ($867 million) in equity and repay state aid in the third quarter, it said on Monday, forecasting operating profit would fall as much as 5 percent in 2013 rather than holding steady.   Central and eastern Europe's No. 3 lender said it would repay 1.76 billion euros in non-voting participation capital it got when the financial crisis began. Two-thirds came from Austria and the rest from private investors. Erste had said in April that not diluting shareholders with a rights issue was a high priority for the bank. The stock fell as much as 7.1 percent to 20.40 euros by 0730 GMT. The Stoxx European banking sector index was flat. Analyst Dirk Becker at Kepler Cheuvreux said it was disappointing that Erste gone back on its promise not to issue shares, but that Austrian regulators wanted the bank to replace at least a third of the capital being repaid. "The short-term performance of the stock could now be negative because of

Founders set for reduced $4.7 billion buyout bid for ENRC

The billionaire founders of ENRC ( id="symbol_ENRC.L_0"> ENRC.L ) are close to finalizing a buyout bid for the London-listed Kazakh miner, valuing the troubled group at just over 3 billion pounds ($4.7 billion), below the value of a tentative proposal made in May. ENRC's co-founders - Alexander Machkevitch, Alijan Ibragimov and Patokh Chodiev - and Kazakhstan's government are seeking to acquire the roughly 46 percent of ENRC which they do not already control, offering cash plus the government's shareholding in Kazakh mining rival Kazakhmys ( id="symbol_KAZ.L_1"> KAZ.L ), also listed in London.   The founders want to take the group private after more than five years of bitter boardroom battles, corruption probes and an acquisition spree that left $5 billion of debt. In a statement on Sunday, a day ahead of the deadline for making a firm offer, the bidding consortium said it was "in the advanced stages" of preparing an offer worth $2.6

UK's Nationwide draws up plan to plug 1 billion capital hole-report

Nationwide ( id="symbol_POB_p.L_0"> POB_p.L ), Britain's biggest customer-owned financial services group, is drawing up plans to raise at least 1 billion pounds ($1.5 billion) to fill a hole in its balance sheet, the Sunday Times said. _0"> Nationwide must raise additional capital of 400 million pounds in order to meet a new target for banks to hold core Tier One capital equivalent to 7 percent of their risk-weighted assets, Britain's financial regulator said last week.   In addition, Nationwide must raise extra capital to meet another new requirement by the Bank of England for banks to have a leverage ratio of at least 3 percent. Its leverage ratio currently stands at 2 percent. The leverage ratio measures capital against total loans, not adjusted for their supposed riskiness, and some bankers argue it penalizes low-risk, high volume businesses like mortgage lending. Nationwide is Britain's third-biggest home loans provider. Chief Executive Graha

UK's Lloyds to ask for two-year extension on branches sale-report

Lloyds Banking Group ( id="symbol_LLOY.L_0"> LLOY.L ) has asked the European competition authorities to give it an extra two years to sell the hundreds of branches it is required to dispose of as a condition for its state bail-out, the Sunday Telegraph newspaper said. _0"> The bank, which is 39 percent-owned by the government, began talks with the European Commission earlier this month. It currently has a deadline of November 30 to sell 631 branches. A sale to the Co-operative Bank ( id="symbol_CPBB_p.L CPBB_p.L ) fell through in April amid concerns over the mutual's financial position.   _1"> The Sunday Telegraph said Lloyds had asked the commission to give it until the end of 2015 to complete the sale. Lloyds is now planning to sell the branches as a separate business via a share listing on the London Stock Exchange. Lloyds plans to sell a first tranche of the shares in the business next year, industry sources have told Reuters. Lloyds decl

ECB's Asmussen calls for stronger European institutions

European Central Bank policymaker Joerg Asmussen said on Sunday that closer integration within Europe called for European Union institutions - in particular its parliament - to be strengthened to ensure democratic control and accountability. _0"> "The increasing level of integration within Europe calls for a new institutional design to ensure legitimization, accountability and democratic control," the German ECB Executive Board member said at an event organized by the Kiel institute for the World Economy.   Asmussen said governments should ensure national parliaments were appropriately informed and involved in European decision procedures. But often, decisions with the European Union's common interest could only be made at a supranational level. "Therefore European institutions should be strengthened, in particular the European Parliament which could maybe also convene in a euro area format," he said. Germany's weekly Der Spiegel wrote on Sunda

Yogurt: the new Pepsi challenge

PepsiCo Inc ( id="symbol_PEP.N_0"> PEP.N ) - best known for Pepsi-Cola and Frito-Lay chips - is taking its Muller yogurt brand nationwide expanding its portfolio of healthier foods at a time that U.S. consumers are increasingly shunning traditional soft drinks. Yogurt is one of the fastest selling categories in grocery stores, and PepsiCo sees plenty of room for growth even though it has come late to the party.   "Dairy has become everybody's favorite avenue when it comes to escaping the miseries of obesity," said Bevmark Consulting CEO Tom Pirko. "Everybody's trying to figure out a health angle." To boost its chances of success, PepsiCo has partnered with Germany's Theo Muller Group, a stalwart of the European dairy industry, repeating a strategy that has already made the snack-and-soda company a leading U.S. purveyor of hummus and other healthy dips. Earlier this month, the Muller Quaker Dairy joint venture opened a yogurt plant in u

Virgin Mobile wins one of three Saudi virtual telecom licenses

Virgin Mobile Middle East & Africa (VMMEA) is one of three companies to win a virtual telecom license in Saudi Arabia , the industry regulator said on Sunday, in the latest step to liberalize the kingdom's communications sector. Five companies had bid for the Saudi mobile virtual network operator (MVNO) licenses. MVNOs not own the networks they use to provide communications services but instead lease capacity from conventional operators, usually paying them a percentage of their revenue as well as fees.   VMMEA, part-owned by British entrepreneur Richard Branson's Virgin Group, will launch an MVNO on former monopoly Saudi Telecom Co's 7010.SE network, the Communication and Information Technology Commission (CITC) said in statement on its website. Jawraa Lebara has joined with second-biggest operator Etihad Etisalat 7020.SE (Mobily), while Dubai-based retailer Axiom Telecom will team up with Zain Saudi 7030.SE. Local companies FastNet and Safari were the losing bid

Frenkel to return as Israel's central bank chief

Jacob Frenkel, an inflation hawk who was Bank of Israel governor in the 1990s, will be returning to the helm of the central bank, Prime Minister Benjamin Netanyahu and Finance Minister Yair Lapid said on Sunday. They appointed Frenkel to replace Stanley Fischer, who is stepping down at the end of June after eight years on the job, having guided Israel's economy through the global financial crisis. Frenkel, 70, beat deputy governor Karnit Flug, who will likely be acting central bank chief until Frenkel starts. The date of his arrival was not announced. "He is a world renowned figure, which is what Netanyahu was looking for," said HSBC economist Jonathan Katz. As governor between 1991 and 2000, Frenkel was credited with reducing inflation, liberalising financial markets and removing foreign exchange controls.   He is currently chairman of JPMorgan Chase International ( id="symbol_JPM.N_0"> JPM.N ) and also served as vice chairman of insurer American Inte

Kuwait sheikh sues UBS for $21.4 million in Dubai court

A Kuwaiti sheikh is suing UBS AG ( id="symbol_UBSN.VX_0"> UBSN.VX ) for $21.4 million, alleging the Swiss bank failed to pay him for helping it become lead arranger on a $9 billion asset sale by the Kuwaiti telecommunications operator Zain, a Dubai court heard on Sunday. The case highlights the complexity of doing business in the Gulf, where personal connections to high-ranking officials or executives are often valued in deal-making.   Sheikh Meshal Jarah al-Sabah, a member of Kuwait's ruling family, says UBS recruited him with a verbal contract in July 2009 to help scupper the French media conglomerate Vivendi's ( id="symbol_VIV.PA_1"> VIV.PA ) bid to acquire Zain's ( id="symbol_ZAIN.KW_2"> ZAIN.KW ) operations in about 15 African countries. UBS denies the allegation. Vivendi called off the talks later that month. India's Bharti Airtel ( id="symbol_BRTI.NS_3"> BRTI.NS ) subsequently bought Zain's African asse

Ambani bets on 4G broadband in India, but risks abound

Indian tycoon Mukesh Ambani hopes his multi-billion dollar bet on cheap high-speed wireless broadband could change the way nearly a billion of his countrymen use mobile devices from the way they do banking to watching cricket. In a country where most people own a mobile phone yet lack basic Internet access, it is a risky gamble even for India's richest man. He is counting on an unproven strategy and still-developing technology in a market with very little pricing power. Three years ago energy conglomerate Reliance Industries Ltd (RIL) ( id="symbol_RELI.NS_0"> RELI.NS ) won an exclusive nationwide licence to roll out 4G across India, giving it a foothold to tap a potentially lucrative market in phones, tablets, computers and television. The data-focused service could start to roll-out in New Delhi and Mumbai by the end of the year, sources familiar with the matter, who asked not be named, told Reuters. Eventually, the plan is to run it across hundreds of cities. Am

Geeks oust miners among Australia's new rich as boom fades

In a country synonymous with larger-than-life mining tycoons and Outback heroes, the geeks are quietly inheriting the earth. As coal magnate Nathan Tinkler, the poster boy for Australia's fading 10-year minerals boom, publicly battles against bankruptcy, software entrepreneurs Mike Cannon-Brookes and Scott Farquhar are riding high.   The former college buddies behind fast-growing software firm Atlassian unceremoniously bumped Tinkler off the top of Australia's "young rich list", leading a charge in the country's blooming technology industries. The tech start-up and biotech sectors are at the forefront of a push to transform Australia from an exporter of iron ore to an exporter of ideas. "It's a pretty primitive economy," said internet entrepreneur Matt Barrie. "We basically dig stuff up out of the ground, put it on a boat and ship it." As part of ambitious plans to change that, the government has announced millions of dollars in new

Britain's Osborne reaches deal on spending cuts

British finance minister George Osborne completed talks on Sunday with government departments aimed at securing spending cuts worth 11.5 billion pounds ($17.70 billion)in 2015-16 to help reduce the country's budget deficit, the Treasury said. The finance ministry said it had reached agreement with all departments, three days before Osborne is due to publish details of their spending limits on June 26.   The talks to find spending cuts starting in 2015 - when voters go to the polls - posed a political headache for Osborne, particularly over the sensitive defense budget and a business department under pressure to do more to revive the economy. Osborne, who announced the end of the talks on Twitter, will now seek to persuade voters that he has a credible plan to build on recent signs that the economy is gaining strength after two years of stagnation. He is expected to give more details on Wednesday of billions of pounds of infrastructure spending designed to bolster the recover

North Korea anxiety sparks South Korean global property binge

A jump in tensions with North Korea has fed a tenfold surge in overseas commercial property spending by investors south of one of the world's most heavily armed borders, making South Korea the largest property investor so far in 2013. South Korean investors bought about $5 billion in the first five months, a huge increase on the first half of 2012, real estate consultant Jones Lang LaSalle ( id="symbol_JLL.N_0"> JLL.N ) said.   "This allocation to commercial property over such a short period of time is unprecedented for the South Koreans," JLL said. "Tensions with the North Koreans have certainly aided the capital flight." Its global buying spree, which puts it ahead of Canada and Singapore, is due to reach $10 billion this year, JLL said. Tensions on the peninsula reached their peak in February when North Korea threatened nuclear and missile strikes against South Korea and the United States after U.N.-imposed sanctions for a nuclear weapons

Australia's Echo unveils $1 billion Sydney casino plan, includes Crown option

Australian gaming firm Echo Entertainment ( id="symbol_EGP.AX_0"> EGP.AX ) has submitted plans for a $1 billion expansion of its Star casino in Sydney, including an option that would allow rival Crown Ltd ( id="symbol_CWN.AX CWN.AX ) to open a VIP-only casino. _0"> Echo, which holds the sole licence to operate a casino in Sydney until 2019, has been lobbying to extend this right in an attempt to block Crown's plans to add to its Melbourne casino.   _1"> Crown, controlled by billionaire James Packer, has said it wants to open a VIP casino in Sydney as part of a A$1 billion six-star hotel and residential waterfront development, boosting its share of the lucrative Asian gambling market. The New South Wales government has said it will approve only one project, meaning either Crown builds a second casino or Echo expands is business and remains the sole gambling operator. Echo said in a statement it would invest more than A$1.1 billion ($1.0 billio

Banks present crisis plan to the Fed: WSJ

U.S. banks have given a proposal to federal regulators on how to pay for restructuring the country's too-big-to-fail institutions in the event of a future crisis, the Wall Street Journal reported, citing people familiar with the conversations. _0"> The Journal said the proposal, given to the U.S. Federal Reserve at a private meeting on May 22, is an effort by banks to pre-empt tougher rules from officials, who believe banks still could pose a threat to financial stability in a crisis.   According to the plan, the largest financial services holding companies would maintain a certain amount of debt and equity that would be used to prop up any failed bank subsidiary seized by regulators. Some banks might even be forced to issue expensive long-term debt, according to the newspaper. In the presentation, the banks said they each would agree to hold combined debt and equity equal to 14 percent of their risk-weighted assets, the Journal said. For the six biggest U.S. banks t

China central bank says overall liquidity 'reasonable'

The overall liquidity in China's financial system is at a reasonable level, the central bank said on Monday, adding that it has asked commercial banks to improve the ways they manage liquidity. _0"> The comments from the People's Bank of China came as interest rates for short-term funds in China spiked to extraordinary levels last week after big commercial banks held back on lending in the interbank market. Rates remained elevated on Monday, but off recent highs. The comments were issued in a notice dated June 17 but released on Monday. (Reporting by Koh Gui Qing; editing by Jonathan Standing)

As Asia embraces casinos, India hedges it bets

Like many visitors to the Casino Royale Goa on a rainy Saturday night on India's western coast, Salim Budhwani said he does not gamble but also had no objection to the betting at the busy tables downstairs. Despite socially conservative India's ambivalence about gambling, consultancy firm KPMG estimated that $60 billion was wagered in the country in 2010. Much of the gambling is illegal, but attitudes are slowly changing as more Asian countries embrace gaming as a revenue generator and tourist draw.   Legal gambling in the increasingly wealthy country of 1.2 billion is limited to state lotteries, horse races and a handful of casinos. Most gambling in India, from penny-stake games at street corners and card parties in affluent homes to wagers on cricket and underground numbers games, is illicit and goes untaxed. "People are playing on the roadside everywhere. People are playing in their houses," said Budhwani, 33, a luggage retailer from the city of Hyderabad who

Analysis: Another China central bank worry; companies push into lending

Chinese companies are getting more creative in the business of money lending as they struggle to keep profits ticking over in a cooling economy, raising concerns they are adding to the mountain of debt risks building in the world's No.2 economy. _0"> Big state companies in industries struggling with over-capacity but with easy access to credit are borrowing funds, not to invest in their business but to lend to smaller firms sometimes at several times the official interest rate, part of an informal lending market in China that authorities are taking aim at. China's central bank increased pressure on banks to rein in such informal lending and speculative trading last week in money markets, letting short-term interest rates spike to extraordinary levels. In the $3.7 trillion so-called shadow banking market, the fastest growing area is in so-called entrusted loans, which are arranged by banks on the companies' behalf, and in bankers' acceptance notes, tradable