Tuesday Papers: UK debt strategy off track

Top stories

• Financial Times: David Cameron admitted on Monday that controlling Britain’s debt was 'proving harder than anyone envisaged', shortly after receiving bleak official forecasts showing the government’s timetable for scrapping the deficit is behind schedule.
• Financial Times: The US congressional committee responsible for striking a deficit-reduction deal ended its work without an agreement on Monday.
• The Guardian: The US congressional committee responsible for striking a deficit reduction deal ended its work without an agreement on Monday.
• The Daily Telegraph: Germany and France, Europe's cornerstone economies, were dragged into the eye of the debt storm on Monday, triggering a collapse of stock prices around the world.
• Daily Mail: Companies in the UK are discovering that global increases in commodity and labour prices mean that Asia’s low-cost manufacturing advantage has been eroded, bringing jobs that have been lost to Asia back to Britain.

Business and economics

• Financial Times: Maurice Greenberg, AIG’s former chief executive, has sued the US government for $25 billion on Monday, alleging that the Treasury illegally appropriated the insurer from shareholders in 2008 and used it 'to covertly funnel billions of dollars to foreign entities'.
• Financial Times: Lloyds Banking Group has been thrown into further turmoil after it emerged that a key management recruit reversed plans to join the part-nationalised bank amid uncertainty over when its chief executive will return from medical leave.
• Financial Times: Austrian bank supervisors have instructed the country’s banks to limit future lending in their east European subsidiaries, a further sign of the potential knock-on effects of the eurozone crisis for economies around the world.
• Daily Mail: Investment powerhouse Hargreaves Lansdown risks angering its vast customer base with new flat-fee charges of up to £2 a month on certain tracker funds.
• Financial Times: Saudi Arabia has halted the $100 billion expansion of its oil production capacity after reaching a target of 12 million barrels a day as the kingdom believes that new oil sources will meet rising demand.
• Daily Express: Former BP chief executive Tony Hayward and financier Nat Rothschild Monday saw shares in their bid vehicle fall 83 pence to 912 pence after it resumed trading under the name Genel Energy following a $2 billion takeover of the Kurdistan-focused oil group.
• Financial Times: Property in the City of London is for the first time majority owned by foreign institutions; investors from Germany, the US and the Middle East have spearheaded an international buying spree.
• The Guardian: Hewlett Packard's fourth-quarter earnings dropped 91% as the troubled information technology company dealt with the fallout from its failed foray into tablet computers and the ousting of its chief executive; the company made $239 million, or 12 cents a share, on earnings of $32.1 billion.
• Financial Times: PwC and KPMG failed to adequately review how certain clients valued mortgage-related securities in 2010, according to the Public Company Accounting Oversight Board.
• Daily Mail: Tesco has been given another vote of confidence by America’s second richest man, Warren Buffett, who said he would like to fill his basket with more of the grocer’s shares.
• Financial Times: Jefferies, the US investment bank, said on Monday it had further reduced its European holdings, and defended itself in a letter criticising hedge funds and other groups for spreading 'outright lies'.
• The Daily Telegraph: US oil giant Chevron is facing fines that could total $83 million as a result of an oil spill off the coast of Brazil and could face a temporary ban on operating in the country.
• Financial Times: Dutch food retailer Ahold plans a major push to triple its online grocery sales to $2 billion by 2016.
• Financial Times: The estimated hole in MF Global’s customer accounts has doubled in size to $1.2 billion, astonishing traders as the investigation into the broker’s failure enters its fourth week.
• Financial Times: Fédération des Exportateurs de Vins et Spiritueux of France is predicting that wines and spirits exports will exceed $13.5 billion for the first time this year, largely because of an increasing fondness among China’s growing middle class.
• Financial Times: Direct Edge has become the latest US exchange operator to challenge BM&FBovespa’s monopoly in the Brazilian market, announcing plans to set up an electronic equities trading platform in Rio de Janeiro.
• Financial Times: A widening corruption investigation involving Finmeccanica sent shares in the Italian defence and industrial conglomerate down to new 13-year lows on Monday; Finmeccanica fell 6.6% in Milan to €3.00.
• The Guardian: Vodafone's turbulent Indian foray has cost the firm an estimated £12 billion over four and a half years.
• Financial Times: A panel investigating more than $1 billion in controversial payments made by Olympus said it had not found any evidence that the payments involved organised crime.
• The Daily Telegraph: Fabergé, the upmarket jewellery company, has opened its first shop in London for nearly 100 years, with the cheapest item on sale a £4,200 pair of earrings.
• Financial Times: DVD and streaming operator Netflix has sold $200 million of convertible senior notes to Technology Crossover Ventures, a long-time shareholder, and has launched a $200 million share offering after its shares fell more than 70% in three-month period.
• The Daily Telegraph: Support services group Mitie said revenues grew 6% to £972 million in the six months to 30 September, while pre-tax profits were up 17% to £43.3 million.
• Financial Times: Investec Fund Finance has ranked the UK ahead of the USA and Switzerland as the most competitive location to set up private equity businesses despite the country’s sluggish economic growth and the sector’s bad image in the country.

Share tips, comment and bids

• Financial Times: Centrica, the owner of British Gas, has stepped up plans to increase its production by agreeing to buy a string of gas assets from Norway’s Statoil and sealing a £13 billion deal to supply UK households over the next 10 years.
• Financial Times: After multiple trips across the Atlantic to Brussels, Duncan Niederauer, chief executive of NYSE Euronext, will be hoping that he and his counterpart at Deutsche Börse will have done enough to persuade European antitrust authorities to clear the merger of their two exchange groups.
• Financial Times: Enterprise Holdings, the world’s biggest car rental operator by fleet and revenues, is broadening its presence in Europe with the acquisition of Citer, a midsized operator in Spain and France owned by PSA Peugeot Citroën; Citer, with 2010 revenues of $373 million, operates about 30,000 vehicles and has 1,000 employees.
• Financial Times: Gilead, the US pharmaceutical company, has agreed to buy Pharmasset in an $11 billion cash deal designed to diversify away from HIV drugs and give it a lead in the fast-growing market for hepatitis C medicines.
• Financial Times: Resolution Group is free to bid again for rival UK life company Phoenix Group at any time because the latter, being Cayman Islands based, is not subject to Takeover Panel rules.
• Financial Times: Apollo Global Management and Goldman Sachs have entered the auction for Bank of America’s British and Irish credit card portfolios.
• Financial Times: Pearson has expanded its reach in China with the $155m purchase of Global Education and Technology Group, a provider of English language test preparation services.
• The Daily Telegraph: Sam Roddick has sold Coco de Mer, her 'erotic lifestyle' business, to Lovehoney, a sex toy internet retailer, ending the Roddick family's long-running presence on the British high street.
• The Guardian (Editorial): For one happy generation, rapid house-price inflation fuelled by ready money and a shrinking supply was a guarantee of previously unimagined riches.
• The Daily Telegraph (Comment): Hungary has returned cap in hand to the International Monetary Fund after kicking out inspectors last year, becoming the first country in Eastern Europe to succumb to contagion from eurozone debt stress.
• Daily Mail (Comment – Alex Brummer): No one could be happy with the slow downward drift in the Lloyds share price since chief executive António Horta-Osório was placed on the injury list, and veteran chairman Sir Win Bischoff has been required to take decisive action to steady the ship.
• Financial Times (The Lex Column): Hewlett-Packard: After the latest earnings call, Meg Whitman has promised no more surprises, but she cannot achieve that by providing less information.
• Financial Times (The Lex Column): Gilead-Pharmasset: The acquisition, in spite of its mind-boggling price tag, is not simply a desperate or overpriced deal. It has considerable advantages.
• Financial Times (The Lex Column): Spain: When the euphoria fades after the Popular party’s most convincing election victory in the post-Franco era, it will not be business as usual.
• Financial Times (The Lex Column): Lloyds Banking Group: The lender has dropped some medium-term income targets and no one knows for sure who will implement those that are left.