PRESS DIGEST - British business - Sept 5

The Mail on Sunday

WALSH PLANS BIGGEST INTERNATIONAL AIRLINE

The chief executive officer of British Airways BAY.L has signalled an appetite for more merger deals to extend the airline's reach into the emerging South American and African markets. After a tumultuous year, involving industrial action and record losses, Willie Walsh said that once his merger with Spain's Iberia IBLA.MC is signed off later this month, BA will be seeking a new partner to help cultivate its expansion ambitions in Latin America.

MORRISONS TO CHALLENGE ONLINE RIVALS

Supermarket chain WM Morrison (MRW.L) has unveiled plans to enter the five billion-pound-a-year online grocery market, which is dominated by rivals Tesco (TSCO.L) and Asda (WMT.N). Newly appointed chief executive Dalton Philips will outline his plans including the launch of Internet trials in several stores on Thursday, in his first significant presentation to the City since he arrived in March. However, Philips is not expected to announce any major capital expenditure before his full update to the City in March 2011.

DANA PINS HOPES ON DRILLING RESULTS

Aberdeen oil firm Dana Petroleum DNX.L is hoping to force an improved offer from Korea National Oil Corporation, which has tabled a 1.87 billion pound hostile bid, when it reveals its defence documents this week. Dana is hoping that its 25 percent stake in the Anne Marie well, off the Faroe Islands, and its preliminary drilling results, with predicted reserves of 300 million barrels of oil, will persuade KNOC to make a more generous offer. However, KNOC has said it has no intentions to increase its 1800 pence-a-share offer, unless it is rivalled. So far KNOC has secured support for its deal by 50 percent of shareholders and is anticipated to purchase its planned controlling stake as soon as Dana releases its defence document.

The Sunday Times

BP READIES 40 BILLION DOLLAR SALE

Oil major BP (BP.L) has announced that it will be auctioning off its 20 billion dollar holding in America's biggest oil field, Prudhoe Bay, as part of a strategic move to finance the burgeoning costs associated with the Gulf of Mexico spill. The sale announcement comes ahead of the publication of BP's internal investigation into the gulf drilling incident, which will determine the firm's legal culpability and the size of subsequent claims. So far clean-up costs in the Gulf of Mexico have risen to eight billion dollars, prompting BP to increase its asset disposal to 40 billion dollars.

ANGLIAN OPENS WINDOW TO SALE

Home improvements firm Anglian Windows has appointed accountants KPMG to manage the auction of the business, which analysts say could be valued at as much as 140 million pounds. A sell-off would mark the second time that the business has changed hands in two years, after it was acquired by its lenders when it failed to meet its financial obligations. Already Anglian, which is expected to be on track to deliver earnings of 20 million pounds in 2010, is thought to have attracted interest by numerous rival companies and private equity investors.

FTSE 100 CHAIRMEN HEAD FOR EXIT

Sir John Bond and Sir John Parker, the chairmen of mobile phone group Vodafone (VOD.L) and utility group National Grid (NG.L) respectively, are to step down. They have been part of the corporate landscape for three decades and the search for their replacements comes amid concerns about the lack of high-quality directors keen to run public companies. Sir Stuart Rose said he would not take on any role with another public company due to the criticism he received at Marks & Spencer (MKS.L).

The Sunday Telegraph

HOUSE OF FRASER TO BRING BACK ICONIC BIBA

House of Fraser, the department store retailer, has posted strong like-for-like sales for the six months to the end of July, as sales increased by 8.4 percent. The company is set to relaunch the 1960s Biba clothing and homeware brand, which it purchased last November, as its own Linea and Label Lab house brands witnessed a sales increase of 62 percent over the same period, with online sales increasing by 150 percent. Stephanie Chen, director for womenswear and accessories, said the retailer was targeting "style-conscious mothers and daughters shopping simultaneously".

NATHAN KIRSH TO CONTINUE BATTLE AGAINST MINERVA BOSSES

Nathan Kirsh, Minerva's MNR.L largest shareholder, has set out his desire to oust the chairman and chief executive of the property developer ahead of this week's emergency shareholder meeting. Despite a failed takeover bid last year, Kirsh said he would not be put off by a "No" vote and that "if we don't win it next week, we'll win it in six months times". Speaking of his intentions for the company, Kirsh said he would consider splitting the company in two, turning one half into a real-estate investment trust. Shares in Minerva closed last week at 87.25 pence.

SUNDAY QUESTOR

Kenmare Resources (JEV.I) (Buy)

Serco (SRP.L) (Hold)

The Independent on Sunday

CHINA FUND PUSHES FOR WALKIE-TALKIE STAKE

Land Securities (LAND.L), Britain's largest property developer, is considering selling a stake in its tallest skyscraper in London to China's biggest sovereign wealth fund. The 500 foot tower, nicknamed Walkie-Talkie due to its top heavy design, will cost an estimated 300 million pounds and is due for completion in 2014. China Investment Corporation, which has 200 billion dollars in funds, opened negotiations for an equity stake of 25 percent. Land Securities began talks in June with Canary Wharf Group to share the cost of development, after the project was stalled in 2008 due to the collapse of the property market. If a partnership is agreed, Land Securities or Canary Wharf would have to become a minority investor.

CABLE AND WIRELESS WORLDWIDE IN SINGTEL'S SIGHTS

The most valuable company on the Hong Kong stock exchange is in the early stages of tabling a bid for Cable & Wireless Worldwide (CWP.L). SingTel has hired bankers in Asia and Europe to discuss the takeover of the UK company. The estimated price would cost the state-backed business more than 1.8 billion pounds but would be considered a good move by SingTel's chief executive, one of Asia's most high-profile businesswomen, Chua Sock Koong. Shares in the Bracknell-based company were given a boost by the news on Friday, as there have been concerns that it is on the brink of falling out of the FTSE 100.

FITNESS FIRST TONES UP ACCOUNTS

Fitness First, the chain of gym's owned by BC Partners, has given an indication that it is preparing for flotation by adopting international financial reporting standards. Deloitte, the company's auditor, will begin standardising results for the year ending October 2010 for its leases in 20 countries. An industry source said: "There are 550 gyms, so that will mean 550 calculations on 550 leases." Although there have been rumours that BC Partners was considering an outright sale of the business which is plagued by a 550 million pound debt, it is understood that it is still keen to list in Asia in 2011 or 2012. The business has suffered from a fall in customers.

The Observer

WATERSTONE'S FOUNDER POISED TO BUY BACK BOOK CHAIN

The founder of Waterstone's is considering buying back the book chain from HMV (HMV.L). Tim Waterstone is keeping an eye on developments at the chain where sales have plunged. Last Christmas, HMV revealed like-for-like sales at Waterstone's fell nearly nine percent during a time viewed as a peak trading period. HMV's chief executive Simon Fox will update the City this week as rebel shareholders push for a sale. They are prepared to wait until after the Christmas trading period to make a final decision. Analysts said Waterstone's value is not reflected in HMV's share price. HMV closed on Friday at 59 pence, valuing the group at 255 million pounds.

UNITE ANGER AT ALLEGED BA SURVEILLANCE OF CABIN CREW

British Airways BAY.L faces a threat of fresh strike action after the union Unite said it is considering a new ballot over alleged anti-union activities. The new developments come amid allegations that two BA cabin crew members were subjected to surveillance at their homes. It is also alleged that shop stewards were prevented from representing employees. The allegations of surveillance centre on BA's security department, Asset Protection, where the crew members are said to have photographic evidence supporting their claims. While BA declined to comment on the allegations, Unite said the airline had gone from violating worker's rights to violating human rights.

Prepared for Reuters by Durrants