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Wednesday Papers: UK attacks ‘excessive’ US ban on BP contract deals

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Wednesday Papers: UK attacks ‘excessive’ US ban on BP contract deals

Top stories

  • Financial Times: The UK government has thrown its weight behind BP in the dispute over its future in the US, branding as “excessive” a ban that prevents the oil company from winning federal contracts due to the 2010 Deepwater Horizon disaster.
  • Financial Times: Brussels will unveil hefty fines as soon as Wednesday on global banks that allegedly formed cartels to rig two global interest rate benchmarks, in a settlement that is set to break European antitrust enforcement records.
  • The Guardian: Regulators should investigate how investment banks are paid for takeover advice, according to the head of the Treasury select committee, after JP Morgan revealed it received £7 million for advising the Co-op Bank on its disastrous merger with Britannia Building Society.
  • The Daily Telegraph: One of the Co-op's main auditors, KPMG, has said he told the bank's former chief executive Barry Tootell to rewrite an overly optimistic report on the troubled lender's health months before it revealed a £1.5 billion capital shortfall.
  • The Daily Telegraph: RBS will have to spend more than £1 billion on upgrading its computer systems in the wake of its latest IT problems, according to analysts.
  • The Independent: Bank of America Merrill Lynch, one of the banks that floated Twitter on the New York Stock Exchange, has stunned Wall Street by warning of an “unattractive valuation” and rated the stock to “underperform” rating on the shares.
  • Financial Times: IBM has launched a legal challenge over an estimated $800 million tax demand from India’s revenue department – becoming the latest major western multinational to find itself ensnared in a payment dispute in Asia’s third-largest economy.
  • Financial Times: PotashCorp of Saskatchewan is shedding almost one in five jobs and cutting production in a sign of the strain that producers of the fertiliser ingredient are under after a longstanding pricing agreement broke up this year.

Business and economics

  • The Guardian: A federal judge announced on Tuesday that Detroit is eligible for bankruptcy protection – the first time in US history that a major city has been declared bust.
  • The Daily Telegraph: British Prime Minister David Cameron acts to end visa problems and welcomes £5.6 billion deals on second day of his China trade visit.
  • The Independent: Duncan Greatwood, a British-born chief executive, has hit the Silicon Valley jackpot for the second time in his career after selling US social media analytics firm Topsy to Apple for a reported $200 million.
  • Financial Times: HTC will be forced to stop selling one of its flagship range of smartphones in the UK after a British judge ruled that the Taiwanese phone maker had breached a patent held by Nokia.
  • Financial Times: India’s Bharti Airtel, the world’s fourth-largest mobile operator by subscribers, has completed a $1 billion bond sale, becoming the first Indian company to raise euro-denominated debt, according to two people familiar with the deal.
  • The Daily Telegraph: Google is stepping up its efforts to move into the internet "cloud", taking on rivals like Amazon and Microsoft in competition for business customers.
  • The Independent: Full year pre-tax profits of Numis climbed from £7.7 million to £25 million, the company said in a statement.
  • The Guardian: Osborne Stationers, a high street chain founded nearly two centuries ago, has gone into administration placing 140 jobs at risk.
  • The Daily Telegraph: Virgin owner Richard Branson claims that if Australian rival Qantas was "better managed" then it wouldn't be in a "financial mess".
  • Financial Times: The chief executive of Adidas Herbert Hainer has admitted that the German sports equipment company has made mistakes and not performed as well as senior executives had hoped.
  • Financial Times: South Yorkshire, internationally renowned during the 19th century for its steel making, could soon become famous for another type of production: titanium.
  • The Daily Telegraph: Lenders to cash-strapped pawn shop chain Albemarle & Bond have hired PwC to advise them on their options.
  • The Guardian: Online gambling company Betfair said it was looking to grow its business in Italy and the United States after having pulled out of a number of countries because of unfavourable regulations and tax rates.
  • Financial Times: Zalora, an online fashion retailer focused on southeast Asia, has raised $112 million from new investors including billionaire Len Blavatnik, the UK’s second-richest person.
  • Financial Times: Asda is stepping up pressure on Tesco and the other big four supermarkets with £200 million of price cuts in 2014.
  • Financial Times: French telecoms provider Iliad has launched a 4G service with rock-bottom prices in a clear message to rivals that it intends to prolong a brutal two-year price war.
  • Financial Times: The deepening difficulties low interest rates are causing for European life insurers were underscored on Tuesday when Austrian regulators ordered the industry to set aside additional reserves to ensure they can pay policyholders’ claims.

Share tips, comment and bids

  • The Daily Telegraph (Questor share tip): Betfair back in black; the company reported record, pre-tax profit of £31.7 million, in the first half, reversing last year’s £64.1 million loss; the online sports betting exchange is a hold ahead of regulatory changes in the core UK market.
  • The Daily Telegraph (Questor share tip): Northgate could go higher on hire; underlying pre-tax profits in the first half were up 14%, to £32 million, and the average utilisation of the fleet was 90% during the first six months at Northgate; the van rental group is showing signs of recovery after a tough five year restructuring.
  • Financial Times: Norges Bank Investment Management strengthened its partnership with the UK’s Crown Estate on Tuesday as it continued to ramp up its real estate presence, purchasing a 25% stake in the £390 million Quadrant 3 redevelopment on London’s Regent Street.
  • Financial Times: Pearson has paid an enterprise value of more than £500 million for Brazil’s largest private network of English language schools, less than a week after selling financial information service Mergermarket.
  • Financial Times (Comment): Foreign exchange trading is always akin to gambling. But, in China, gambling may be a way of trading foreign exchange: one way to get around the country’s currency controls is to take a trip to the casinos of Macau.
  • The Guardian (Editorial): Britain is not so far behind industrially and China not so far advanced as a comparison between 1881 and 2013 might suggest.
  • The Daily Telegraph (Comment): Political concern over rising energy costs has focused, not unreasonably you might think, on household bills, yet much more scandalous in some respects are the charges levied on business, particularly energy intensive industries such as steel making, heavy engineering, car manufacturing, and so on.
  • Daily Mail (Comment – Alex Brummer): BP is winning preferential treatment from Siberia to the Arctic. All of this ought to be better news for investors that include most of British pension funds.
  • Financial Times (Lex): Dow Chemical: Group has no option but to focus on boosting return on invested capital.
  • Financial Times (Lex): US bank start-ups: Historically low rates and high regulation make it hard on newcomers.
  • Financial Times (Lex): Rio Tinto: Deep cuts in capex are turning the miner to an ever-purer play on the ore.
  • Financial Times (Lex): Detroit’s bankruptcy: City’s treatment of its obligations is likely to set precedents.
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