BUSINESS WITH PERSONALITY
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Issue 1,386 Friday 20 May 2011
LINKEDIN SURGES
109% ON DAY ONE
Flotation of social network sparks fear of new dot.com bubble
TECHNOLOGY
▲
BY STEVE DINNEEN
SHARES in LinkedIn exploded during
their first day of trading, racing more
than 170 per cent above their float
price of $45 before closing 109.4 per
cent higher at $94.25.
The stock hit a peak of $122.70,
bringing back memories of the
dot.com boom of the late 1990s. After
achieving a market cap of $4.25bn
with its $45-a-share float, already at
the top end of its upgraded price-
range, the firm soared in its debut to
close with a market cap of $8.9bn.
With 2010 earnings of just $15.4m,
the shares’ performance values
LinkedIn at an astonishing 578 times
earnings. It is also trading at an eye-
watering 36.6 times its 2010 revenues
of $243m.
Professional services social network
LinkedIn had already upgraded its
listing price by 30 per cent in the days
running up to its IPO but attracted an
unprecedented amount of interest as
investors fell over themselves to get
hold of the stock.
The flotation has stoked concerns
that Silicon Valley is in the midst of a
second dot.com bubble. Hype sur-
rounding the upcoming flotations of
internet heavyweights such as
Facebook, Groupon and Zynga has
now reached fever pitch. Facebook
FTSE 100 ▲5,955.99 +32.50 DOW ▲12,605.32 +45.14
WWW.CITYAMAWARDS.COM P2
$8.9bn
market cap
36.6x
2010 revenue of
Opening price $45 $243m
LinkedIn shares went into orbit yesterday, with co-founder Reid Hoffman’s stake now worth about $2bn
has already been valued at more than
$70bn based on shares trading on the
secondary market, but if the LinkedIn
float is anything to go by it could see
its value rocket far higher.
Baidu, the number one Chinese
search engine, rose 354 per cent on
its Nasdaq debut in 2005, but
LinkedIn is the first US web-based
NASDAQ ▲2,823.31 +8.31
www.cityam.com
stock to emulate its success.
LinkedIn’s co-founder and ex-
PayPal executive Reid Hoffman made
$5.2m selling less than one per cent
of his shares. His remaining stake in
the company – 21.7 per cent of the
voting power – is now worth just shy
of $2bn. LinkedIn raised $352.8m on
Wednesday by selling about eight per
£/$ 1.62 unc £/¤ 1.13 ▼-0.01 ¤/$ ▲1.43 +0.01
SIR FRED IS
EXPOSED
AFFAIR REVEALED
AS GAGGING
ORDER LIFTED P3
FREE
Bail given
to former
IMF chief
▲
ENFORCEMENT
BY ALISON LOCK
DOMINIQUE Strauss-Kahn, the former
head of the International Monetary
Fund, was granted bail in a New York
court yesterday after four nights’
detention on charges of allegedly
attempting to rape a hotel maid.
Strauss-Kahn, who resigned from
the IMF vowing to prove his innocence
late on Wednesday, was set a $1m
(£617m) cash bail by New York judge
Michael Obus.
Stringent terms, designed to ensure
Closing price $94.25 Strauss-Kahn does not leave the US,
included him remaining under 24-
hour home detention with electronic
monitoring, having an armed guard
at all times at his own expense, and a
$5m insurance bond.
He was returned to prison after the
hearing to spend a final night in the
notorious Rikers Island jail before the
578x bail paperwork is signed today.
His resignation from the IMF inten-
sified jockeying among world powers
2010 earnings of over who would succeed him.
Pressure from emerging markets to
$15.4m see one of their number lead the fund
was countered by swift bids from
France and Germany to secure the
seat for Europe. French finance minis-
cent of the company. ter Christine Lagarde has emerged as
Analyst Anthony Miller of his most likely successor with the
TechMarketView told City A.M. a lot of backing of several countries.
day one investors “will be very happy Strauss-Kahn was arrested on
indeed”. He added: “This doesn’t nec- Sunday after a chambermaid accused
essarily mean we’re in another bub- him of trying to rape her. He has been
ble but I’m definitely not reaching for charged with a criminal sexual act,
my wallet either.” attempted rape, sexual abuse, unlawful
ALLISTER HEATH: P2 imprisonment and forcible touching.
Certified Distribution
04/04/11 - 01/05/11 is 103,899
 2 News
Next IMF boss shouldn’t be European
EDITOR’S LETTER
ALLISTER HEATH
FAR too much time and energy is
being wasted on trying to work out
who the International Monetary
Fund’s (IMF) new boss will be. The
truth is that it is unlikely to matter
that much: the individuals entrusted
with the running of large transna-
tional bureaucracies almost invari-
ably find it impossible to break away
from the tyranny of the status quo.
Soon enough, even radical reformers
tend to be brought back into the fold
and to spout the consensus view on
all matters. In part, of course, this is
because those who pay the IMF’s bills
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Deputy Editor David Hellier
News Editor David Crow
Night Editor Katie Hope
Business Features Editor Marc Sidwell
Lifestyle Editor Zoe Strimpel
Sports Editor Frank Dalleres
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WHAT THE OTHER PAPERS SAY THIS MORNING
MOVE TO QUASH HERMÈS’ POISON PILL
Minority shareholders in Hermès
have sought to quash the luxury
goods group’s poison pill defences
devised by its controlling family,
potentially bolstering LVMH’s pro-
tracted takeover push for its smaller
rival.
CHINESE SET A NEW STANDARD IN
BUYING GOLD
China overtook India to become the
largest market for gold bars and coins
in the first quarter of this year, as ris-
ing inflation inspired a surge in bul-
lion investment. Chinese investors
bought 93.5 tonnes of gold between
¬January and March in the form of
coins, bars and medallions, a 55 per
cent increase from the previous quar-
ter and more than double the level of
a year earlier, according to data
released by the World Gold Council
on Thursday.
tend to exercise the real power. In any
case, most of the leading candidates –
such as France’s Christine Lagarde,
who used to chair the law firm Baker
& McKenzie – wouldn’t really change
any of the IMF’s policies, at least not
in any substantial way.
It would nevertheless be fun for
Dominique Strauss-Kahn’s replace-
ment not to be a European citizen –
especially given that the IMF’s new
role seems to be to bail out bankrupt
Eurozone nations, in a desperate
attempt to pretend that their sover-
eign debt is worth more than it is and
to reduce their need to take truly
tough measures. Yet the European-led
IMF was always perfectly happy to
force much harsher policies on
emerging countries. These days, how-
ever, it is the Asian and other emerg-
ing nations that have put their
houses in order and Europe and the
US that continue to spend money
they don’t have. It wouldn’t make
much, if any, difference in practice
but it would be poetic justice for
Broughton bid
closes on Tote
LEISURE
▲
BY RICHARD PARTINGTON
SIR Martin Broughton, the former
chairman of Liverpool Football Club,
appeared last night to be pulling
ahead in the race to buy the Tote, the
state-owned bookmaker.
It emerged yesterday that Sir
Martin’s Sport Investments Partners
(SIP) has secured private equity back-
ing to fully underwrite his bid for the
Tote, as well as renewed support from
the racing industry.
The development will allay con-
cerns that his bid lacks the financial
clout required by the government
from bidders.
Private equity house Oakley Capital
will guarantee funding for the SIP bid
in the event that a planned stock
market listing fails to raise sufficient
capital.
US NETWORKS VIE FOR $18BN IN AD
CONTRACTS
Criminals, housewives and dinosaurs
will dominate the all-important
autumn schedules at the big US TV
networks, a blend that has advertisers
jostling to secure commercials during
the best programmes. The so-called
“upfronts”, at which cable and broad-
cast networks debut their new shows
to advertisers and media buyers, have
taken over some of the biggest the-
atres in Manhattan this week.
QUAKE IMPACT LESS SEVERE THAN
FEARED, SAYS PANASONIC
Panasonic’s chief executive has said
the impact on sales from March’s
earthquake is looking less severe than
was first feared, in the latest sign that
Japanese industry is recovering more
quickly than expected from its disas-
ter-related supply-chain problems. In
April, it said it might lose several hun-
dred billion yen in revenues in the
current quarter as a result of the
quake and tsunami.
somebody from an Asian Tiger econo-
my to be given the top job at the IMF.
BUBBLENOMICS
There are now so many dot.com suc-
cess stories globally that listing them
all would be a hopeless endeavour.
Take Amazon.com, one of the longest-
established internet firms, which
started selling books in 1995: yester-
day it announced that it is now sell-
ing more Kindle e-books than
hardcopy books for the first time,
even though the former were
launched under four years ago. Since
1 April, it has been selling 105 e-books
for every 100 print books. This
includes sales of hardcover and paper-
back books where there is no Kindle
edition; free Kindle books are exclud-
ed. Amazon is now a major global
powerhouse and a key reason why sec-
ond-rate retailers such as Mothercare
are being forced to shut many of their
stores.
But LinkedIn, while undoubtedly a
fast-growing and successful business,
Support from a powerful horserac-
ing lobby group and Conservative MP
Matt Hancock, a close ally of chancel-
lor George Osborne, also appeared to
have handed SIP victory over Betfred.
The British Horseracing Authority,
the Racecourse Association and the
Horsemen’s Group pledged to sup-
port Sir Martin’s offer.
“SIP’s bid is a good deal for the gov-
ernment, while providing the best
solution for racing,” he said.
Meanwhile, Betfred said it
remained confident its bid offered
the “best solution” for the Tote.
Sir Martin Broughton’s
bid to buy the Tote, the
state-owned bookmak-
er, appears to be ahead
of rival bidder Betfred.
FRESHFIELDS RAISES STAKES IN THE
BATTLE FOR LEGAL TALENT
One of the City’s oldest law firms has
broken ranks with its rivals to
increase salaries for rank-and-file
lawyers amid concerns that a war for
talent could break out as the legal
market recovers. Freshfields
Bruckhaus Deringer said that it would
increase rates for newly qualified
solicitors from £60,000 to £61,500.
ADMINISTRATOR CHASES TCHENGUIZ
EMPIRE FOR £600M
The administrator of Britain’s biggest
property management group is going
after Vincent Tchenguiz’s freehold
empire in an attempt to recover near-
ly £600 million for creditors. Zolfo
Cooper said it had discovered an out-
standing loan of £594m from one of
the Tchenguiz Family Trust’s compa-
nies that never actually reached its
Peverel management group.
is not in the same class as Amazon. Its
valuation yesterday was preposterous:
its shares more than doubled on its
first day as a public company, valuing
a firm which generated earnings of
just $15m in the first nine months of
last year at $8.9bn. For some reason,
investors are allowing another bubble
to build in tech stocks. They are fail-
ing to distinguish between good, fast-
growing companies – of which
LinkedIn seems to be one – and super-
stars, new Googles, Amazons or even
Facebooks. Why do investors never
learn?
LAST CHANCE SALOON
Today is your last chance to nominate
individuals or firms for City A.M.’s
annual awards, where we celebrate
the best and brightest of London’s
business community. For more infor-
mation on the categories and how to
enter, go to www.cityamawards.com –
do enter, it will be a great event.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
Prudential chairman Harvey McGrath was the focus of investors’ ire
Investors slam Pru chair
INSURANCE
▲
BY ALISON LOCK
SHAREHOLDERS of the Prudential
delivered a stinging rebuke to chair-
man Harvey McGrath as more than 28
per cent failed to support his re-elec-
tion at its annual meeting yesterday.
McGrath became the focus of
investors’ wrath for his stewardship
of the Pru through its botched
$35.5bn (£21.9bn) bid to acquire Asian
insurer AIA last year.
About 22 per cent opposed his re-
AL GORE SAYS NEWS CORP ABUSED ITS
POSITION OF POWER
Al Gore has accused Rupert Murdoch’s
News Corporation of abusing its posi-
tion of power by forcing the former US
Vice President’s television channel off
air in Italy. Mr Gore said News Corp
forced his CurrentTV off Sky Italia
because Current hired Keith
Olbermann, who has been critical of
the media conglomerate in the past.
HSBC REITERATES ASIA FOCUS AS IT
LOOKS FOR SAVINGS
HSBC will not exit its Indian and
Chinese retail banking businesses
despite losing money in the countries
as deposits there are needed by the
bank. Stuart Gulliver, chief executive
of HSBC, said that despite losing
money in both countries the lender
would hold on to the businesses
because of its requirement for large
yuan and rupee deposits.
CITYA.M. 20 MAY 2011
NEWS | IN BRIEF
Gap falls after cutting forecasts
Shares in clothing retailer Gap fell 13 per
cent after it slashed its full-year profit
outlook yesterday on rising cotton and
production costs. Net income in its first-
quarter, which ended on 30 April, fell
22.8 per cent to $233m (£144m), or 40
cents per share, from $302m, or 45
cents per share, a year earlier. It said it
now expects to earn $1.40 to $1.50 per
share in the fiscal year ending in
January 2012, down from the $1.88 to
$1.93 it had predicted in February.
EU bailout funds plan debt sale
The Eurozone’s bailout funds plan to
issue another €3bn to €5bn (£2.6bn to
£4.4bn) in bonds within the coming
weeks to help to fund Portugal and
Ireland’s multi-billion euro rescue fund-
ing packages, the EU said yesterday. The
European Financial Stabilisation
Mechanism (EFSM) and European
Financial Stability Facility (EFSF) aim to
sell a total of €15.3bn between 23 May
and 15 July in four blocks of bonds, with
five to ten year maturities and yields of
about 3.6 to 2.7 per cent. It will be the
fourth sale of the AAA-rated bonds by
the funds.
Picture: GETTY
election and 6.2 per cent abstained in
one of the largest shows of displeasure
seen at any company vote this year.
The result was higher than the 10 to
20 per cent opposition expected.
In contrast, chief executive Tidjane
Thiam, who was widely criticised for
his handling of the AIA deal, received
99 per cent support for his re-election.
McGrath said 78 per cent support
was “a pretty good mandate” to con-
tinue. But one industry source told City
A.M.: “It takes a lot for investors to
reject a director in this way.”
TECH GIANTS DEFEND PRIVACY
PRACTICES
Google, Apple and Facebook defended
their privacy practices Thursday to
lawmakers considering how to update
privacy laws to include more protec-
tions for Internet users. At a Senate
hearing on mobile privacy issues, law-
makers grilled technology executives
on their policies and how they share
consumer information with other
companies.
CHICKEN COMPANIES WAIT IN VAIN
FOR INDUSTRY CUTBACK
Hurt by soaring feed costs and lacklus-
ter demand, chicken companies think
cutting back production to stave off a
glut is a great idea—as long as it is
their competitors doing the cutting.
None of the large producers—includ-
ing Sanderson Farms Inc., Tyson
Foods Inc. and Pilgrim's Pride Corp.—
wants to be the first to cut back.
CITYA.M. 20 MAY 2011 News 3

Disappointing float
Former RBS chief
executive Sir Fred
Goodwin allowed
the courts to lift
part of his super-

debut for Glencore

injunction covering
his alleged affair
with a co-worker
yesterday

Picture: REX

despite spiking to 553p, it closed at its

▲
CAPITAL MARKETS
BY JULIET SAMUEL
GLENCORE shares closed flat yesterday
after the launch of conditional trading
in the commodities trader. It now has
a value of $61bn (£37bn) after raising
$10bn in the second-biggest float in
London’s history.
The company’s owners had hoped
for a price rise of five to ten per cent on
Glencore’s first day of trading, but
initial price of 530p. Dealogic said the
float could be London’s biggest ever if
investors take up an optional over-
allotment of $1bn. That would beat
Rosneft’s $10.7bn float in 2006.
Unconditional trading in its shares
starts next Tuesday in London and
Wednesday in Hong Kong. It could
then see its price rise on demand from
index-tracker funds, as it is expected to
enter straight into the FTSE 100.

Gagging order
shredded in a
blow for Fred
injunction relating to a sexual rela-
▲

POLITICS
BY ALISON LOCK
A SUPER-INJUNCTION taken out by
former RBS boss Sir Fred Goodwin was
partially lifted by the high court after
a peer told the House of Lords of its
details yesterday.
Liberal Democrat peer Lord
Stoneham – whose comments can be
reported as they were covered by par-
liamentary privilege – questioned
why events leading up to the collapse
of RBS, including “the alleged rela-
tionship between Sir Fred Goodwin
and a senior colleague” should not be
shared with taxpayers.
Sir Fred took out the gagging order,
which prevented him being identified
as a banker, to stop the media report-
ing the alleged “sexual relationship”.
News Group Newspapers went to
court following the Lords discussion
to try to get the injunction lifted.
Sir Fred had by then told the court
he did not oppose the move to name
him, and high court judge Justice
Tugendhat amended the order to
allow publication of Goodwin’s name
but not details of the alleged relation-
ship or the name of the woman.
“The main point is that this is an
tionship,” Tugendhat said. “The exist-
ing order of Mrs Justice Sharp
prohibits the naming of the other per-
son to the relationship and prohibits
the publication of any details. That
remains in force.”
Lord Stoneham, asking a question
on behalf of fellow peer Lord
Oakeshott, told the Lords that hiding
the alleged affair would be “a serious
breach of corporate governance”.
“Would [the speaker] accept that
every taxpayer has a direct public
interest in the events leading up to
the collapse of the Royal Bank of
Scotland?” Stoneham asked. “So how
can it be right for a super-injunction
to hide the alleged relationship
between Sir Fred Goodwin and a sen-
ior colleague? If true it would be a seri-
ous breach of corporate governance
and not even the Financial Services
Authority would know about it.”
Lords deputy leader Lord McNally
replied: “I do not think that it is
appropriate from this dispatch box to
comment on individual cases, some of
which are before the courts.”
Sir Fred earned the nickname “Fred
the Shred” for his ruthless cost-cut-
ting at RBS.

German insurer admits hosting

sex party for its best salesmen
▲

INSURANCE
A PROSTITUTE-filled sex party was
arranged to reward top salesmen at a
subsidiary of the world’s biggest rein-
surance company, Munich Re, the
firm admitted yesterday.
Munich Re’s insurance arm Ergo
said the party took place at the Gellert
Baths thermal baths in Budapest,
where 100 of its best salesmen were
given free access to at least 20 prosti-
tutes.
The party, in June 2007, was
arranged by Hamburg-Mannheimer
International, which is now part of
Ergo and so the Munich Re group.
Details of the party, first reported in
German newspaper Handelsblatt,
cited former HMI employees saying
the baths were turned into an “open-
air brothel” for the “incentive trip”.
The women present wore colour-
coded armbands in red, yellow and
white, with red identifying them as
purely hostesses; yellow bands indicat-
ing they were prostitutes and white
bands meaning they were “reserved”
for executives and the best agents.
Beds were set up for the salesmen
and women to use, and after each
encounter the women had their fore-
arms stamped, the paper reported.
Ergo spokesman Alexander Becker
told City A.M. the people responsible
for the party were no longer with the
firm and measures were put in place
in 2007 to prevent such an event tak-
ing place again.
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CITYA.M. 20 MAY 2011 News 5

Government gears up for fight

with banks over lending targets
banks approved £17bn of lending in must meet their targets “should suffi-

▲
POLITICS
BY DAVID CROW
THE GOVERNMENT ratcheted up the
pressure on the banks yesterday,
ahead of new figures that are expect-
ed to show that the industry is failing
to meet lending targets.
As part of the Merlin deal, banks
were asked to lend £190bn this calen-
dar year, with £76bn of that going to
small businesses. But official figures
due Monday are expected to show
the first three months of the year,
£2bn less than their implied £19bn
quarterly target.
Vince Cable, the business secretary,
yesterday repeated threats that the
banks could be forced to pay higher
taxes if they miss the lending targets.
He said: “If the banks don’t deliver
there are options open to the govern-
ment, including taxation.”
However, the Merlin agreement on
lending only stipulates that banks
cient demand materialise”.
A thorny issue for the government
is how it can prove demand, especial-
ly as growth has been more sluggish
than the Treasury expected when the
agreement was signed in February.
An aide to chancellor George
Osborne said the burden of proof
would be on the banks: “The banks
need to prove their sales are drum-
ming up business, and giving them
incentives to lend more.”

FSA chief Hector Sants will lead the watchdog’s replacement Picture: GETTY

New FSA to be
EU’s enforcer
Sants also appeared ready to sign
▲

REGULATION
BY JULIET SAMUEL
FSA chief Hector Sants yesterday
unveiled plans for a new UK regula-
tory authority that critics say will
gold-plate European regulation by
“second-guessing” the management
of financial institutions.
The new Prudential Regulatory
Authority, which will take over a por-
tion of the FSA’s functions next year,
is to adopt a “forward-looking”
approach and will have powers to
question the “competency” of man-
agement and ban business models
that it deems too risky.
KPMG’s Giles Williams said that
the PRA’s job will be “second-guess-
ing financial institutions’ own man-
agement” while the British Bankers’
Association said the plan was for a
“more intrusive” dialogue between
regulators and management.
During a conference to explain
the PRA’s new regulatory philoso-
phy, Sants said there would be a
“fundamental” change from the
FSA’s approach.
“Central to this supervisory model
is the presumption that regulators
cannot rely on the judgment of the
management of the firms they
supervise,” he said of the PRA.
away UK sovereignty on the crafting
of regulation, saying that the PRA
would be “essentially a supervisory
arm of a European regulatory
regime”.
While the new body will not be
able to avoid implementing EU rules,
it will be allowed to augment them
by, for example, imposing additional
capital requirements on particular
firms.
Simon Hills of the British Bankers’
Association said: “The PRA said quite
explicitly that it will go further than
maximally harmonised European
regulation. We are concerned that in
some areas UK regulators may be
looking for a carte blanche to gold-
plate regulation.”
Sants said that the PRA will try to
influence regulations through dia-
logue with the European Banking
Authority (EBA), but many in the
City have questioned how effective
the UK’s lobbying effort can be while
its regulatory bodies are being over-
hauled.
Baker & McKenzie’s Ian Mason
said: “I don’t think the fragmenta-
tion of our regulator is particularly
helpful from that point of view… It’s
not as good as having a single uni-
fied regulator in Brussels.”

AT A GLANCE | REPLACING THE FSA

• The Prudential Regulatory Authority
(PRA) will be one of three bodies to take
over from the Financial Services Authority
(FSA) next year. It will monitor and reduce
the riskiness of individual firms and feed
data to the Financial Policy Committee,
which will monitor and mitigate macro-pru-
dential risk.
• The PRA will place firms in one of five cat-
egories: the first deemed safe, while the last
will involve implementing a resolution plan.
The PRA will force firms in the latter cate-
gories to revamp their businesses.
• The PRA, unlike the FSA, will have the
power to publish reports into firms like RBS
that have had to be rescued. It will also
require firms to publish some of the data
they give to regulators, although the details
have yet to be decided.
• All firms will have to create resolution
plans to enable an orderly wind-up if they
fail. The aim is to be able to impose losses
on all creditors “without the financial sys-
tem falling apart”.
6 News CITYA.M. 20 MAY 2011

Focus on wealth management pays off

AT first glance, Investec has missed
forecasts with full-year operating
profit of £434m: analysts had been
hoping for something nearer the
£450m mark. But the South African
bank and wealth manager still
gained the most in two-months dur-
ing trading yesterday. A candidate
for demotion from the FTSE100,
thanks to the entry of mining giant
Glencore, it is hoping that Invensys
(virtually its namesake) gets the
wooden spoon instead.
Investors were impressed not by
the below-consensus headline fig-
ure, but by the improving quality of
its earnings. The bank is moving
away from traditional lending to
conserve capital, while investing
heavily in asset and wealth manage-
ment. On yesterday’s numbers, it
appears the strategy is paying off.
With the exception of the private
bank, which posted a £91m loss due
to an 11 per cent increase in impair-
ments, all divisions are performing
well. The Asset Management arm
and Wealth and Investment divi-
sion, which both increased profits
by over 50 per cent, are worth point-
ing out. These two divisions now
account for 39 per cent of group
operating profits, against 19 per
cent in 2008. Obviously, the busi-
nesses aren’t capital intensive
because the bank is using third
party funds.
Analysts at Numis reckon that
profits at the private bank will
return to pre-crisis levels as the
recovery gathers pace. With a loan
book that is now 48 per cent larger,
Numis sees group operating profit
jumping by 59 per cent. That would
imply a price to earnings ratio of less
than seven times, suggesting the
shares still have some way to go.
BOTTOMLINE
Analysis by David Crow
Investec managing director Bernard Kantor cheers growth in asset management

Investec sees
upgrades as
profits grow
per cent to £127.3m on net inflows of
▲

BANKING
BY JULIET SAMUEL
ANALYSTS upgraded South African
lender Investec after its full-year
results for the year to March yesterday,
despite the bank taking an unexpect-
ed hit from a rise in impairments in its
private bank, which posted a loss of
£91.4m.
The bank’s managing director
Bernard Kantor told City A.M.: “The
problem was Ireland. We wrote off
£97m there as opposed to last year’s
£49m.” He added: “The bigger deals in
Ireland caused us some concern. But
we honestly think we have peaked and
impairments are from now on going
to normalise, the sooner the better.”
Regarding the prospect of future
write-downs, Kantor said: “It depends
what happens with Ireland and the oil
price. Whilst we think we have provid-
ed what we should have, we live in a
volatile world, so who knows?”
Despite the private bank’s shock
loss, Investec’s other five divisions all
posted strong rises in earnings. Overall
pre-tax profit rose 13.6 per cent to
£466.4m. Its asset management busi-
ness saw operating profit jump 52.6
£7.4bn during the year.
The greatest rise in earnings was in
the investment bank, where propri-
etary investments and “a good deal
pipeline” drove operating profit up
62.1 per cent to £67.4m.
However, the bank’s costs were hit
by currency fluctuations, bonus costs,
growing headcount and several acqui-
sitions, including that of Rensburg
Sheppards Investment Management.
Its cost-to-income ratio rose from 57.8
per cent last year to 61.7 per cent,
though was still below the bank’s tar-
get maximum of 65 per cent. Despite
the rise in costs, the bank delivered an
11.2 per cent return on equity.
ANALYSIS l Investec
500 p
487.00
19 May
480
460
440
21 Feb 11 Mar 31 Mar 20 Apr 16 May

Buying still an Collins Stewart’s

option for Close assets hit £8bn
▲

FINANCIAL SERVICES FINANCIAL SERVICES

FINANCIAL services firm Close
Brothers yesterday hinted its buying
spree might not be over yet in a bid to
boost its stagnant assets under man-
agement (AUM).
The firm said AUM at its investment
management arm were flat at £8.2bn.
Close Brothers recently bought
financial adviser Cavanagh, although
said its financial performance had left
it “well positioned to support future
growth opportunities”.
The firm’s banking division offset the
weak AUM performance, seeing a four
per cent increase in its loan book to
£3.3bn.
STOCKBROKER Collins Stewart posted
a £300m jump in assets under man-
agement (AUM) to hit £8.2bn in the
first four months of this year.
At the end of April, the firm’s cash
position stood at £49m, down from
£69m at the same time a year earlier.
It added that it had been successful
in integrating two firms it acquired
last year, and added that further
wealth management acquisition
opportunities were also under review.
“The full benefits of a number of sig-
nificant hires and acquisitions over the
last year or so are still to show through,”
said chief executive Mark Brown.
 8 News
Good news for National Grid boss Steve
Holliday
Ex-Deloitte
UK chief to
join AMEC
▲
SUPPORT SERVICES
BY RICHARD PARTINGTON
JOHN Connolly, the chief executive of
Deloitte in the UK, has been appoint-
ed chairman of engineering firm
AMEC.
He is due to retire from his role at
the top of the international account-
ancy firm’s British operation at the
end of this month and will join the
AMEC board on 1 June.
He joins at a time when AMEC is
looking to expand in the United
States, after it agreed to purchase
Georgia-based engineer MACTEC ear-
lier this week.
A corporate finance specialist,
Connolly has been senior partner and
chief executive for 12 years.
He qualified as a chartered account-
ant in Manchester. He rapidly rose
through the ranks and was made
partner in charge of Deloitte’s Leeds
office in 1983 and was appointed to
run the firm’s northern region in
1985.
He moved to the firm’s London
office in 1990 and
was made man-
aging partner
of all offices in
1995.
Connolly
is on the CBI
advisory board
as well as sev-
eral other busi-
ness and charity
boards.
Lamprell uses rights issue to acquire peer
▲
ENERGY
BY RICHARD PARTINGTON
BRITISH oil services firm Lamprell has
agreed to buy Gulf-based peer
Maritime Industrial Services (MIS) in a
deal worth £208m.
The Isle of Man-based firm will use
a rights issue, debt and cash to acquire
the Norwegian-owned rig maker.
The fully underwritten issue will
offer new shares of the company at
National Grid profits jump 25pc
▲
ENERGY
BY HARRY BANKS
NATIONAL Grid, the UK’s biggest ener-
gy distributor, said investment in its
home market and ongoing US restruc-
turing meant the outlook was posi-
tive, as it met forecasts with a 25 per
cent jump in annual profit.
National Grid also said yesterday
that the process of finding a new
232p per unit to raise as much as
£139.4m.
Cash from existing resources and
funds from a new $150m (£92.6m)
loan facility will also be used to make
the acquisition.
The deal to buy MIS will give
Lamprell the opportunity to expand
its geographical range, at a time
when interest in offshore drilling is
picking up.
“Strategically the MIS deal makes
chairman was well under way. But
management declined to comment
on reports that former BP chief execu-
tive John Browne was in the running.
Adjusted pre-tax profit rose 25 per
cent to £2.5bn in the year to the end of
March. Earnings per share of 51.7p
compared with a forecast for 49.24p.
National Grid said a number of tim-
ing differences, including collection
of revenue owed to regulated busi-
sense and if market forecasts are accu-
rate, it certainly looks good value for
Lamprell,” said Brewin Dolphin ana-
lyst Greig Aitken.
Lamprell chief executive Nigel
McCue said: “This transaction will
rapidly create value for our share-
holders and demonstrate the merits
of bringing together these two busi-
nesses both through new business
opportunities and operational and
financial synergies.”
nesses from previous years and over-
recovery of revenue, boosted profit in
2011, adding 5p to earnings per share.
“We have a positive outlook for
2011/12 and expect to deliver another
year of good operating performance,”
said the company, led by Steve
Holliday. “Although comparative per-
formance will be impacted by the tim-
ing differences that benefited
2010/11.”
ADVISERS: BANK OF AMERICA MERRILL LYNCH
RUPERT
HUME-KENDALL
MERRILL LYNCH
BANK of America Merrill Lynch
advised Lamprell on its takeover of
Maritime Industrial Services.
The team from the bank was led by
chairman of global equity markets
Rupert Hume-Kendall.
CITYA.M. 20 MAY 2011
ANALYSIS l National Grid
640 p 622.50
19 May
600
560
21 Feb 11 Mar 31 Mar 20 Apr 16 May
Margins fall
as debt rises
at Intertek
▲
INDUSTRY
BY MARION DAKERS
SHARES in testing firm Intertek
dropped 2.4 per cent yesterday after
the firm’s profit margin fell in the
first four months of the year, mainly
due to slower growth in its consumer
goods arm.
Organic revenues grew eight per
cent in the period compared to last
year at constant exchange rates,
though the firm said consumer
goods growth was “lower then
expected, mainly as a result of an
unusually long holiday shut-down
period in China”.
Intertek said that when revenue
from its purchase of industrial servic-
es group Moody and unfavourable
exchange rates are taken into
account, revenues rose 11 per cent.
The purchase of Moody in March
pushed Intertek’s debt to EBITDA
ratio to 1.9 times on a pro-forma
basis.
Intertek said there had been “an
element of disruption” to activities
in Japan and North Africa, but added
that its work in these regions is on a
small scale.
“Looking ahead, we expect to
achieve group organic revenue
growth, at constant exchange rates,
in the high single digits range for the
full year,” said chief executive
Wolfhart Hauser in a statement.
“Intertek’s early 2011 revenue per-
formance is in line with our forecast,
but we believe that lower year-on-year
margin comments may lead to some
profit-taking following the outperfor-
mance of the shares over the past
three months,” wrote Numis analyst
Steve Woolf, who has a “hold” rating
on the stock.
The firm is due to hold its annual
general meeting this afternoon.
The firm’s FTSE 100-listed shares
lost 47p to close at £19.50, giving it a
market capitalisation of £3.17bn.
A veteran banker, Hume-Kendall has
enjoyed a prolific City career. In 2008
he came 67th in a poll of the City’s
1,000 most powerful people. In the
same year, he helped RBS to complete
a £12bn rights issue to fix the troubled
bank’s battered finances.
He joined Merrill Lynch in 1998,
where he has since been heavily
involved in advising Santander, WPP,
3i and British Airways.
Lamprell was also advised by JP
Morgan and HSBC. By Scarlett Archer
CITYA.M. 20 MAY 2011
Hugh Langmuir has been managing partner of Cinven since 2009
ANALYSIS l Southern Cross
22
18
p
9.50
19 May
14
10
6
21 Feb 11 Mar 31 Mar 20 Apr
Care home
firm reveals
profit slump
▲
HEALTH
BY RICHARD PARTINGTON
EMBATTLED care homes operator
Southern Cross yesterday said it hopes
to turn its fortunes around, despite
revealing a £311m half-year loss.
The UK’s largest care homes
provider has been squeezed by a fall
in the number of patients placed by
local authorities and a real terms cut
in fees, due to public sector austerity.
Revenues at the Darlington-based
business slipped to £464m in the six
months to 31 March, down 3.4 per
cent on the same period a year earlier.
Southern Cross can no longer
afford to pay full rent at its 750
homes and is in talks with landlords
over a possible reduction in rates.
Accountant KPMG, financial advis-
er Greenhill and lawyer Clifford
Chance have been brought in to assist
in its discussions.
The firm also revealed it had
plunged a further £13.5m into its
£50m bank borrowing facility in the
six months to 31 March, taking it to
£21m in debt.
However, creditors Lloyds and
Barclays have agreed to waive tests on
its banking covenants until the end of
June, buying time for the company.
“Southern Cross is now in a critical
financial position and cannot afford
to meet its future rent obligations in
full,” said chairman Christopher
Fisher.
THE STRUGGLE FACING SOUTHERN CROSS
Q. WHY IS SOUTHERN CROSS IN SO
MUCH TROUBLE?
A. Cuts to local authority budgets
are hitting private sector firms
that deliver public sector services
hard. Southern Cross is faced with
a real terms cut in fees from coun-
cils across the country, while
authorities are also reluctant to
place as many pensioners into full-
time care. It also does not have as
many private sector customers as
many of its peers. Added to this,
Southern Cross is unusual amongst
other care home operators. It does
16 May
not own the buildings it runs and is
locked into lengthy and expensive
contracts.
Q. WHAT HAPPENS IF THE
COMPANY GOES BUST?
A. Going bust would be the worst
possible outcome for all those
involved with Southern Cross.
Landlords would be left with care
homes to run and the banks would
have to fight to recoup the money
owed to them. To avert disaster,
should rent negotiations fail, a buyer
could be found for all or part of
Phadia nets Cinven £2.5bn
▲
PRIVATE EQUITY
BY MARION DAKERS
BUY-OUT group Cinven has sold
Phadia, a maker of allergy and auto-
immune tests, to Thermo Fisher
Scientific for €2.47bn (£2.18bn), it
announced yesterday.
Cinven paid €1.29bn for Sweden-
based Phadia in January 2007, and
has expanded the firm’s US and
Q&A Clydesdale takes PPI hit
Southern Cross’s
business.
Q. WILL SOUTHERN CROSS
A.
PATIENTS BE AFFECTED?
Worryingly, the possibility of a
slip in standards is not out of
the question. The firm said failure to
achieve quality standards was among
the fundamental risks it faces.
However, a spokesperson insisted the
standard of care would not slip. The
spokesperson added that the stan-
dard of care in homes operated by
Southern Cross had gone up.
News 9
Asian market shares. ture, and it will probably do well.”
The deal, set to close in the Thermo shares rose 4.5 per cent to
fourth-quarter, is expected to $65.60 yesterday.
increase Thermo’s earnings by 26 to Phadia reported revenues of
30 cents per share in 2012, the US- €367m in 2010, continuing its streak
based buyer said. of 10 per cent annual revenue
“It’s a decent deal for them,” said growth.
Peter McDonald, an analyst at Barclays is advising Thermo
Auriga USA. “It fits well with their Fisher Scientific, while Goldman
speciality diagnostics business, it Sachs is acting as financial adviser
leverages some of their infrastruc- to Phadia.
Goldman
tops list for
global M&A
▲
BANKING
BY RICHARD PARTINGTON
GOLDMAN Sachs is the top bank for
global mergers and acquisitions
(M&A), having advised on deals worth
$297.5bn (£183.8bn) so far this year.
The Wall Street giant pips rival JP
Morgan to the top of a list of global
banks, according to data provider
Dealogic.
JP Morgan has advised on deals
worth $281bn so far this year.
Goldman has advised on some 59
transactions worth more than $1bn
apiece, out of a total of 138 deals. The
deals worth more than $1bn account
for 91 per cent of the total deal value
of its advisory work.
The biggest deal the bank advised
on so far this year is the $21.5bn pur-
chase of Swiss medical firm Synthes
by US healthcare giant Johnson &
Johnson.
Barclays Capital was the highest
placed UK-based investment bank,
having advised on $151.8bn worth of
M&A deals.
TOP BANKS FOR M&A THIS YEAR
Adviser Value $bn No. of deals
1 Goldman Sachs 297.5 138
2 JP Morgan 281 128
3 Credit Suisse 252.2 106
4 Morgan Stanley 233.8 116
5 Citi 201.4 84
6 Bank of America 184.3 130
Merrill Lynch
7 Deutsche Bank 167.2 93
8 Barclays Capital 151.8 55
9 UBS 132.9 89
10 Lazard 117.7 60
ment of future PPI claims based upon
▲
BANKING
NATIONAL Australia Bank’s UK unit
estimates, statistical analysis and
assumptions in relation to a wide
Clydesdale Bank has said it will make
an additional provision of £100m to
cover compensation for people sold
range of uncertain factors, including
how many PPI claims will be made
against Clydesdale Bank PLC, for what
insurance they could never claim or value, and the prospects of mis-selling
did not know they were buying. being established in relation to those
The mis-selling of debt repayment claims,” NAB said yesterday.
insurance policies could cost Britain’s “Clydesdale Bank will continue to
banking industry some £8bn. work to resolve PPI claims promptly
“The provision reflects an assess- and fairly.”
 The Capitalist
10
OUT OF AFRICA FOR CITY LEADERS
AT MAYOR’S MANSION HOUSE GALA
ZULU dancers and an African gospel
choir raised the roof at Mansion
House last night at the Africa Gala
hosted by Lord Mayor Michael Bear.
“Welcome to my humble home,”
said the Mayor as he welcomed 250
guests from firms including UBS,
Shell, HSBC and Laing O’Rourke to
the black-tie benefit, held in aid of
the Mayor’s Bear Necessities appeal.
News anchor Natasha Kaplinsky
hosted the auction, while former
BBC foreign correspondent Martin
Bell made an “exceptional” speech,
said Viewpoint Africa founder Ayo
Johnson, about the impact of war.
It’s back to Mansion House this
morning for a debate on how the pri-
vate sector can improve its response to
humanitarian disasters. Martin
McCann, CEO of Redr, is the charity
partner, and the panel includes
EDITED BY CITYA.M. 20 MAY 2011
HARRIET DENNYS
Got A Story? Email
thecapitalist@cityam.com
Follow The Capitalist
on Twitter: @citycapitalist
Richard Hardie of UBS and Keith
Howells, CEO of Mott MacDonald.
No sign of former RBS chief Fred
Goodwin is expected though, cur-
rently the talk of the City after his
super-injunction was shredded.
When asked if Goodwin had been
invited, McCann said diplomatical-
ly: “Charities hope that the people
we invite are all well respected in
the community at large.”
Above: Lord Mayor Michael Bear and the Lady
Mayoress Barbara Bear with the Mighty Zulu Nation
Right: Broadcaster Natasha Kaplinsky
Above: Former BBC foreign correspondent Martin Bell with Redr CEO Martin McCann
Above: Steve Canadine of Gifford, Mark
Richardson of Laing O’Rourke, Cathy
McNulty of Arup, Philip Dilley of Arup
Left: Chris Anastasi of International Power
and James Smith, former Shell UK chairman
Above: Mark Enderby of Delancey, Steve Cook of Cundall, Barry Connolly of King Sturge
and Bronwhyn Thomas of UBS Pictures: Micha Theiner/City AM
CITYA.M. 20 MAY 2011
Landlords reap rewards as rents hit a record high
£988
average monthly rent
for London in
April 2011
£11,981
average total annual
return for London
landlords
Soaring rental prices are boosting profits
for London’s landlords, writes Elizabeth
Fournier. But it means that co-habiting
couples are having to rethink priorities.
LONDON rental prices have shot
up by almost eight per cent over
the last year, hitting their second-
highest level on record and boost-
ing landlords’ total annual returns
above five per cent.
The average monthly rent in
London is now £988 – just £4 below
its all-time high of £992 in
November last year. Prices have
increased by 7.9 per cent since
April 2010, and by 12 per cent in
the past two years, according to the
latest buy-to-let index from LSL
Property Services.
London landlords in particular
are seeing the benefits of the
increase, with average total returns
on properties in the capital hitting
5.1 per cent, as strong house prices
help maintain healthy yields.
But falling house prices have bal-
anced rising rents in other parts of
the UK, with average returns at 2.1
per cent, down from 13.1 per cent
in April last year.
“Competition is fierce and ten-
ants are paying a premium to
secure properties,” said David
Newnes of LSL. “The average land-
lord is charging nearly £30 more a
month than a year ago, and the
rate of increase is unlikely to
tail off.”
WINNERS AND LOSERS
Blockbuster profits from the
UK’s largest residential land-
lord reflect the figures, as
Grainger said yesterday that its
profits had soared to £65.2m
from £3.5m in the same period
last year, largely on strong markets
in London and the South East.
Grainger’s net asset value (NAV)
per share, adjusted for deferred tax
News 11
CITY VIEWS: HAVE YOU NOTICED RENT PRICES RISING?
Interviews by Phoebe Torrance and Scarlett Archer
DANIEL BERRY | ATARAXIA GROUP RICHARD BAXTER | HISCOX SYNDICATES STEPHEN GIRDLER | ACCENTURE
“I’ve bought a property but “Yes, I think rent prices are “Definitely, a lot of people
I'm still aware that rent has increasing, but despite rising are complaining about the
risen across the capital. It’s prices for property in London, it rising costs. Banks aren’t
increasingly difficult to get a is still a better option than buy- willing to loan money for
mortgage these days with
banks less likely to lend
ing as tenants don’t suffer
volatile house prices.”
mortgages so people can’t
afford to buy; there’s too
money.” much flux at the
moment.”
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The FTSE 250 company has
increased its exposure to London
recently, and assets in the capital
now account for around 48 per
cent of its residential portfolio.
Student letting agent Unite also
said it was on track to meet targets
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But rising rents have taken their The Samsung Notebook 900X3A is beautifully crafted
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 12 News
Japanese firm
spends €9.6bn
on Nycomed
▲
PHARMA
BY HARRY BANKS
JAPAN’S largest drugmaker Takeda
Pharmaceutical is buying privately
held Nycomed for €9.6bn (£7.3bn), it
announced yesterday, boosting its
presence in emerging markets and
adding a newly approved lung-dis-
ease drug to its portfolio.
The agreed deal is the biggest over-
seas purchase by a Japanese company
since Japan Tobacco paid $19bn
(£11.7bn) for Britain’s Gallaher, and is
Takeda’s second major buy after its
$8.8bn deal for Millennium
Pharmaceuticals in 2008.
The acquisition gives Takeda, a
mainly Asian- and US-focused maker
of drugs, a new treatment for “smok-
er’s lung” called Daxas and a portfo-
lio of over-the-counter products.
Swiss-based Nycomed will help
Takeda expand in Europe and emerg-
ing markets, providing an immediate
source of stable cashflow at a time
when its top-selling diabetes drug
Actos faces the upcoming expiry of
its US patent.
“We have a strong European back-
bone and, even more importantly, a
very strong and rapidly growing
emerging markets presence – that, I
think, was the key,” said Nycomed
chief executive Hakan Bjorklund.
Emerging markets are set to
become the main driver for the glob-
al pharmaceuticals industry as
patents run out on many top drugs
and sales in Western markets stall.
Nycomed is majority owned by
four private equity firms, led by
Nordic Capital with a 41 per cent
stake. Credit Suisse’s DLJ Merchant
Banking has 25.6 per cent, Coller
International Partners 9.7 per cent
and Avista 8.9 per cent.
FAST FACTS | NYCOMED
● Nycomed focuses on gastroenterology, respi-
ratory, pain and osteoporosis drugs.
● Nycomed’s owners had been mulling a float
at some stage, but was not expected to put the
plan in place until at least 2012.
(from left) Guildhall principal Barry Ife, Lord Mayor Michael Bear and Gerald Ronson
Ronson’s new home for Guildhall
School of Music reaches milestone
▲
PROPERTY
THE CITY’S Lord Mayor and property
tycoon Gerald Ronson yesterday cele-
brated the completion of the frame
of the new Guildhall School of Music
& Drama on Silk Street.
The school’s new home will make
up the bottom two floors of The
Heron residential tower, which is due
to complete in 2013.
Almost two-thirds of the flats in
the 36-storey tower have been sold.
The school will contain a 608 seat
concert hall and a 227 seat theatre
once it moves into the new site.
“It will now have the facilities to
rival any in the world and, given the
proximity of the Barbican arts cen-
tre, a cultural oasis has been created
in the heart of the City of London,”
said Lord Mayor Bear at a ceremony
yesterday.
Ronson is assisting with the
Guildhall school’s fundraising cam-
paign which still has £8.5m to raise.
CITYA.M. 20 MAY 2011
BofA sells stake
in BlackRock
back for $2.5bn
▲
BANKING
BANK of America (BofA) is selling its
remaining BlackRock stake back to
BlackRock for $2.5bn (£1.54bn), its lat-
est step to prepare for new industry
capital requirements.
The sale further chips away at the
relationship between the world’s
largest asset manager and the biggest
US bank by assets, but a senior Bank of
America official will remain on
BlackRock’s board.
For Bank of America, the deal raises
cash that can be put to work expand-
ing other businesses and prevents the
bank from having to hold a large
amount of capital against the shares,
which would be required under the
new Basel III capital rules.
“This doesn’t change the bank’s
position in the short-run, but you will
see the difference when the new rules
come into play,” said Marty Mosby, a
bank analyst with Guggenheim
Securities LLC.
Mosby estimated the deal will likely
add a $300m pre-tax gain to the bank’s
second-quarter earnings.
A BofA spokesman said the latest
share sale is consistent with the bank’s
strategy to sell business units that do
not serve its core customers.
BofA acquired a stake in BlackRock
as part of the Merrill Lynch deal in
2008.
CITYA.M. 20 MAY 2011
TalkTalk sees
shares surge
as profits rise
▲
TELECOMS
BY STEVE DINNEEN
TALKTALK continued a downward
trend in terms of lost broadband cus-
tomers, shedding 25,000 in the fourth-
quarter.
The company has struggled to inte-
grate an unwieldy customer base after
buying Tiscali and AOL UK, generating
high levels of complaints amid break-
downs in its billing system.
However, its shares surged 6.5 per
cent as synergies from the acquisi-
tions and a six per cent increase in
average broadband customer spend
helped lift profits 25 per cent to
£276m on 4.7 per cent higher revenue
of £1.8bn.
Chief executive Dido Harding said
it was a strong all-round performance
against a backdrop of major change.
She said: “We are confident that we
are now making major progress in
improving the experience for our cus-
tomers, which will lead to lower
churn.
“All the major elements of our pro-
gramme to integrate the former
Tiscali business were completed by
the year-end, and we achieved our tar-
get of £55m of synergies. During this
process a number of customers suf-
fered disruption. We have worked
hard to mitigate the impact of this.”
TalkTalk, spun out of retailer
Carphone Warehouse in March 2010,
forecast broadly flat revenue for the
current year, and said its core earn-
ings margin would rise to up to 18 per
cent from 15.6 per cent.
ANALYSIS l TalkTalk Telecom Group
155
p tion unit of Daily Mail & General
150
140.10
145 19 May
140
135
130
125
21 Feb 11 Mar 31 Mar 20 Apr
News 13
IEA wants oil
supply increased
▲
ENERGY
THE International Energy Agency
(IEA) yesterday urged oil producing
countries to increase supply to avoid
“derailing the economic recovery”.
TalkTalk chief executive Dido Harding said the firm has moved on from its integration woes The organisation says high oil
prices are threatening the global
ANALYST VIEWS: WHAT DO YOU MAKE OF recovery by reducing spending power
and driving up inflation, placing
TALKTALK’S FIGURES? By Steve Dinneen
upward pressure on interest rates.
The IEA statement suggests it could
release emergency stockpiles if action
is not taken.
MORTEN SINGLETON | INVESTEC
“
Full-year results were a bit of a mixed bag, but on balance perhaps
slightly more positive than negative. Revenue and subscriber numbers continue Euromoney
”
to disappoint but cost and profit progression and dividend upgrades provide
beats forecasts
the counter balance. ‘Hold’ retained.
MIKE JEREMY | DANIEL STEWART
“
▲
PUBLISHING
These figures are very close to outlook especially on cashflow generation
and with Ebitda ahead of my outlook. There is also an improvement in margin. The
”
EUROMONEY, the financial informa-
Tiscali integration is materially complete and it will now concentrate on trying to
improve its quad-play. Overall I’m comfortable with this direction.
Trust, said yesterday that it is trading
in line with expectations after first-
half operating profit rose 10 per cent
MANOJ LADWA | ETX on sales up 13 per cent.
“
Sales for the last six months were
£168m, while adjusted operating prof-
The management at TalkTalk have done a fantastic job as they achieved
it was £49.8m. Analysts had expected
significant savings from the Tiscali integration while growing the broadband busi-
”
sales of £164m and operating profit of
ness. Investors will not be fazed by the flat outlook for 2012, as the business is
£49m. Euromoney kept its interim
16 May being pushed forward from a much more solid base.
dividend steady at 6.25p.
14 News >>> RETAIL AND ECONOMICS ON P15&16 >>> CITYA.M. 20 MAY 2011

CITY MOVES | WHO’S SWITCHING JOBS Edited by Harriet Dennys in association with

Babson Capital Europe
The credit fund manager has appointed Kam
Tugnait as a managing director, ahead of its
plans to launch a further UCITS fund focusing
on European high yield, to be co-managed by
Tugnait. Most recently, Tugnait was head of high
yield at Gartmore, where he ran the firm’s high
yield corporate bond fund. Prior to Gartmore, he
served as head of high yield at Standard Bank
and United Bank of Kuwait. Babson Capital
Europe manages €6.5bn (£5.7bn) in assets.
Mizuho International bank has made two appointments to
The London office of the Japanese its fixed income trading and research
team. David Ramsey will join from
Santander at the end of May as direc-
tor of rates trading for Core Europe
and Brian Jensen, formerly of Cantor
and Conduit, will join in June as direc-
tor of credit trading for the telecoms
media and technology sector.
JP Morgan Asset Management
Carlos Salamonde has been appointed
as chief executive for the bank’s invest-
ment management business in Brazil.
Salamonde joins from Banco Itau
Unibanco, where he was head of corpo-
rate distribution and sales for the asset
management division.
Capita Fiduciary
Michael Clark has joined the financial
services provider’s London office in the
newly created role of head of pension
trusts. Clark previously worked for
third-party administrator MNPA, and
will head up a team of independent
trustees currently working with 80
pension schemes.
Reed Smith
The law firm has appointed Brett Hillis
to its energy and natural resources
group. Hillis, who was previously at
SNR Denton, primarily advises on com-
modity and environmental derivatives.
Oriel Securities
The stockbroker has hired Simon
Edwards, David Henry and Salma
Seetaroo to its corporate finance team.
Edwards joins from Evolution
Securities while Henry and Seetaroo
join from Société Générale.
Deloitte
The business adviser has appointed
Richard Parsons to set up a dedicated
private equity coverage team. Parsons
previously worked for Deloitte until
2000, when he joined Hawkpoint to
manage the bank’s private equity rela-
tionships.

To appear in CITYMOVES please email your career

SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT + 44 (0) 207 092 0053
updates and pictures to citymoves@cityam.com morganmckinley.com

BEST OF THE BROKERS

ANALYSIS l ICAP 473.70 ICAP
550 p 19 May Goldman Sachs rates the inter-dealer bro-
530 ker “buy” with a 12-month target price of
510 640p. Goldman thinks ICAP is well-placed
490 to benefit from the structural flux of the
470 over-the-counter markets and was reas-
21 Feb 11 Mar 31 Mar 20 Apr 16 May
sured by results on Wednesday.
ANALYSIS l Kingfisher 285.00 KINGFISHER
290 p 19 May UBS rates the retail group “buy” and has
270 raised its target price from 285p to 310p
250
ahead of Kingfisher’s first-quarter results
on 2 June. The broker expects profits of
230
£180m, or 23 per cent ahead of last year,
21 Feb 11 Mar 31 Mar 20 Apr 16 May with improving margins.
ANALYSIS l BP BP
500 p 447.90 Bank of America Merrill Lynch has upgrad-
19 May
480 ed the oil group to “buy” with a target
460
price of 580p. The broker thinks BP is at a
crossroads following the collapse of its
440
Russian deal, and believes management
21 Feb 11 Mar 31 Mar 20 Apr 16 May need to look for more drastic alternatives.
To appear in Best of the Brokers, email your research to notes@cityam.com

Energy shares drive FTSE

THELONDON 100 index as from the start of deal-
ings on 25 May. FTSE will issue a
notice after the market close tonight

REPORT detailing which stock will be

removed to make way for Glencore,
based on closing prices that day.
Likely candidates for demotion

E
NERGY and banking stocks pro-
pelled Britain’s FTSE 100 higher
yesterday as commodities trad-
ing giant Glencore made its
London Stock Exchange debut.
As the London market closed,
Glencore’s shares on the grey market
were trading around the widely
expected launch price of 530p.
Glencore will be added to the FTSE
include Investec, which was up 5.4
per cent, and Invensys, which fell 3.1
per cent after both reported full-year
results.
The FTSE 100 index closed up 32.50
points, or 0.6 per cent, higher at
5,955.99 but off its session high of
6,003.92, and having advanced 1.1
per cent in the previous session,
snapping a five-session losing streak.

Small gains on Wall Street

selves to a patch of economic weak-

THENEW YORK ness over the summer. Stocks have

been resilient, only falling 1.5 per
cent, but the S&P is struggling to

REPORT make headway above 1,340, an area

that has met with repeated bouts of
selling.
The Dow Jones industrial average

T
HE DOUBLING of social network
LinkedIn’s shares in its market
debut yesterday dominated the
stock market in an otherwise
lacklustre session, in which equities
rebounded from recent losses.
Many investors have resigned them-
gained 45.14 points, or 0.36 per cent,
to 12,605.32. The Standard & Poor’s
500 Index rose 2.92 points, or 0.22 per
cent, during the day to 1,343.60. The
Nasdaq Composite Index added 8.31
points, or 0.30 per cent, to close at
2,823.31.
CITYA.M. 20 MAY 2011
Manufacturing back on track Skilled staff tough to find
▲
UK ECONOMY
BY JULIAN HARRIS
BRITAIN’S resurgent factory sector
remains on track for a strong recovery,
according to the latest industrial
trends survey from the Confederation
of British Industry (CBI).
Order books jumped to well above
the long-run average for the survey
this month, up nine points from April.
Total orders rose to a two per cent
negative balance (from -11 per cent)
while export orders rose to a three per
cent negative balance (from minus six
per cent).
Order books recovered well but
Warmer April
boosted high
street’s sales
▲
RETAIL
BY JULIAN HARRIS
HIGH street sales shot up in April
according to official figures released
yesterday, with the royal wedding
and unusually warm weather cited
as possible reasons for the upturn.
The volume of sales, excluding
petrol, was up 1.2 per cent on the pre-
vious month, and 2.7 per cent higher
than at the same time last year.
“The pound shot up almost half a
cent against both the euro and dollar
this morning, as April’s retail figures
swept the markets off their feet,” said
senior dealer Glenn Uniacke at
Moneycorp.
While the Office for National
Statistics warned of one-off effects
boosting the figures, the upward
revision of March’s sales growth (to
0.4 per cent) showed some sign of
underlying optimism for Britain’s
shops.
However, the underlying trend
appears flat, with the high street
needing a strong summer to push on.
The volume of sales, excluding
petrol, was stagnant in the three
months to April, compared to the
previous three months.
“While April’s sales data look good
NEWS | IN BRIEF
Fuel costs passed onto consumers
Businesses in Britain are paying over
£250m more for fuel than they were
a year ago, research revealed yesterday.
And over half (52 per cent) of firms will
pass the extra costs onto their cus-
tomers, Bibby Financial Services found.
The research revealed that the impact on
Britain’s small and medium sized enter-
prises is one of the biggest issues facing
companies in the UK, and as the price of
diesel fuel is set to rise by £300m on last slumped to 3.9 from 18.5 in April.
year to £2bn, smaller businesses have no
other choice than to pass on the addition-
al cost, the report said.
American existing house sales fall New claims for unemployment benefits in gain in March. The result “indicates per-
Sales of previously owned US homes fell the US fell more than expected last week, haps some moderation but not, in our
in April, a trade group said yesterday, in a but a rise in the four-week moving aver- view, a significant slowdown”, according
sign that the country’s housing market is age to a six-month high indicated the
remain below March’s seemingly one-
off peak, when a positive balance of
five per cent of respondents reported
“above normal” demand.
“The Bank of England’s agents sur-
vey out yesterday gave a similar mes-
sage,” said Citigroup’s Michael
Saunders. “With exports growing very
rapidly and business investment also
recovering quickly, the UK manufac-
turing sector is likely to continue to
boom.”
Manufacturers are optimistic of fur-
ther improvements. One third expect
output to increase over the next three
months, compared to just 13 per cent
who expect it to fall.
at face value, it is likely to be a blip in
an otherwise miserable trend,” said
economist Ken Wattrett of BNP
Paribas.
Some analysts attributed April’s
spike to booming food and clothing
sales. While the ONS adjusts the data
to recurring seasonal effects such as
Easter holidays, no adjustment is
made for one-off distortions such as
the Royal Wedding.
Stores that mainly sell food saw
sales jump 2.2 per cent compared to
March, the highest jump since May
2008.
Non-food stores showed more mod-
est growth, at 0.4 per cent, although
clothing and footwear were up 3.2
per cent – the joint sharpest monthly
spike since August 2008.
ANALYSIS l Extreme variations in weather
6.0 have caused volatile sales
y/y %
5.0
4.0
3.0
2.0
1.0
0.0
-1.0
Feb Apr Jun Aug Oct Dec
struggling to recover from the recent
financial crisis. Sales slipped 0.8 per cent
month-on-month, the National
Association of Realtors revealed.
Philadelphia factory growth slows ly reported 434,000. The four-week mov-
Factory activity in the US Mid-Atlantic ing average of unemployment claims, a
region grew much more slowly than
expected in May, a survey showed yester- by 1,250 to 439,000 – the highest level
day. The Philadelphia Federal Reserve
Bank said its business activity index
Economists had expected a much higher The index of US leading indicators, which
reading.
US jobs market still struggling
While expectations for output
prices eased in the survey, “inflation-
ary pressures remain a concern”, said
the CBI’s Ian McCafferty.
One third of respondents still
expect to be charging more for domes-
tically ordered goods over the next
three months, with only one in ten
saying they will drop prices.
“Pricing expectations remain well
above their long-run average,” the
report said.
The measure of current output
slowed for the second straight month,
but the positive balance of 20 per cent
remains well above the long-run aver-
age of seven per cent.
Bank of England deputy head Charles Bean said sterling should be kept weak
Bank: we accept inflation
▲
UK ECONOMY
THE Bank of England has “chosen to
accept” above-target inflation in an
attempt to rebalance the economy
towards exports and business invest-
ment, deputy governor Charles Bean
admitted yesterday.
Keeping inflation close to its two per
cent target “would have required a
markedly higher level of Bank Rate and
with it most probably a somewhat high-
Source: ONS er level for sterling”, Bean conceded.
Feb Apr Higher rates and a stronger pound
labour market recovery will remain
painfully slow. Initial jobless claims fell
29,000 to a seasonally adjusted
409,000. Yet the prior week’s figure was
revised up to 438,000 from the previous-
better measure of underlying trends, rose
since mid-November.
Economic indicators slip in the US
gauges the economic outlook three to six
months ahead, fell 0.3 per cent in April,
from an upwardly revised 0.7 per cent
to Nicholas Tenev of Barclays Capital.
as positions left unfilled
▲
EMPLOYMENT
SKILLED labour is increasingly diffi-
cult to find, a survey of British
employers revealed yesterday.
One in six employers indicated
problems with filling positions,
recruitment firm Manpower UK
found, up from one in 12 employers
reporting the same issue last year.
“Many organisations that have
previously cut their headcounts are
now finding that they need to
increase their workforce in an
would have “retarded the requisite re-
balancing of the economy”, he told a
business gathering in Belfast.
Bean said inflation has been pushed
higher by commodity prices, a tax
increase and the pound’s decline.
Consumer price inflation has bal-
looned to 4.5 per cent, with the Bank
admitting that it is likely to miss its tar-
get until 2013.
“Some on the Bank’s committee
appear quite ambivalent as to whether
the target is actually hit,” said
Citigroup’s Michael Saunders.
Fraud against government
costs £700m, says KPMG
▲
CRIME
FRAUD against the UK government is
costing the public purse almost
£700m a year, leading consultant
KPMG will announce today.
Fraud had reached a peak of £679m
in 2006-07, before dropping to £286m
in 2008-09 following a VAT-related
clampdown.
Yet fraud surged to a fresh high of
£693m in 2010-11.
“Financial criminals are now
becoming more businesslike and
Economics 15
increasingly talent-hungry market,”
said Manpower director Mark Cahill.
“Britain is facing a serious talent
shortage in certain sectors.”
Engineering is the industry with
the greatest talent shortage, the sur-
vey found. Accounting and finance,
ranked number one for talent short-
ages last year, in fact dropped to
ninth place this year.
Only 12 per cent of UK companies
provide additional training to staff
in order to fill vacancies, compared
to 21 per cent internationally.
Earthquake-hit
Japan plunges
into recession
▲
ASIAN ECONOMY
JAPAN’S economy officially plunged
into recession in the past quarter, offi-
cial figures confirmed yesterday.
The devastating earthquake and
tsunami that hit the country in
March was partly responsible for an
unexpectedly sharp 0.9 per cent drop
in GDP in the opening three months
of the year.
“The second-quarter data will be
even worse,” warned Julian Jessop of
Capital Economics.
“While it is true that the economy
will almost certainly start to grow
again in the second-half of the year,
there will still be major headwinds,”
Jessop said.
Yesterday’s result translated into an
annualised contraction of 3.7 per
cent, much worse than forecasts, and
contrasting with annualised growth
of 1.8 per cent in the US in the same
quarter.
Private consumption, which makes
up about 60 per cent of the economy,
fell 0.6 per cent, as consumers cut
spending after the quake.
External demand, or net exports,
pushed down GDP by 0.2 percentage
points, as the disaster disrupted sup-
ply chains and prevented Japanese
manufacturers from shipping goods
abroad.
“The release of radioactive material
into the environment and the sea
may further hamper net exports,”
warned Tim Ohlenburg of the Centre
for Economic and Business Research
yesterday.
methodical,” said KPMG’s Jeremy
Outen.
New taxes such as carbon trading
and green tax allowances have pro-
voked fraudulent activity, the
research found.
“In addition, technology and large
scale processing (such as online or
call centres) have made large scale
frauds easier to accomplish,” Outen
added.
Tax fraud has been the most com-
mon kind of fraud since 2009, with
114 court cases in the last year.
 16 Consumer News
Brick sizes up expansion
▲
RETAIL
BY JOHN DUNNE
MOSS Bros chief executive Brian Brick
is a made to measure retailer, always
eyeing how his wares can be better
presented or the product line
tweaked.
Visiting his new three-in-one Moss
store, with hire, retail, and specialist
bespoke under one roof in Canary
Wharf, he breezes around extolling
the virtues of a well cut suit and crisp
shirt. Having sold his Suits You chain,
Brick was targeted by Moss to breathe
new life into the business. He told City
Boom in Asia
drives profit
at SABMiller
▲
CONSUMER
BY JOHN DUNNE
STRONG growth in the emerging
markets of Africa, Asia and Latin
America helped brewing giant
SABMiller beat forecasts with a 19
per cent rise in annual earnings
while Europe and North America
proved tougher.
The world’s second-largest brewer
and maker of Miller Lite, Peroni and
Grolsch said trading in its emerging
markets, which provide over 80 per
cent of its earnings, were improving,
with Africa and Asia leading and
Latin America back in growth.
Group revenues rose seven per
cent to $28.3bn (£17.5bn) and operat-
ing profits or EBITA were up 15 per
cent to $5bn.
Chief executive Graham Mackay
added a note of caution for Europe
and North America, highlighting the
uncertainty in the outlook for infla-
tion and the pace of recovery, espe-
cially with high levels of
unemployment in markets like the
United States.
“Africa and Asia are trucking along
as if the world financial crisis had
not happened, Latin America is less
bullish but is back in growth, the US
Booker cashes in as shoppers look for Dairy Crest performance
cheap deals in grim consumer climate up thanks to Country Life
▲
RETAIL
BY JOHN DUNNE
BRITAIN’S biggest cash and carry
wholesaler Booker yesterday said it
was benefiting from consumers’
“search for value” as it beat forecasts
with a 25 per cent jump in annual
profit.
The firm, which runs around 172
branches supplying convenience
stores, restaurants, pubs, schools and
prisons, made a pre-tax profit of
£71.4m.
A.M: “Working for a public company
is a different experience and you have
to have a long term plan. What we are
doing here is aiming for the mid mar-
ket – we are neither very expensive
nor cheap.
“I am personally involved with
choosing the product ranges.”
He says that the woes of his
competitors, including Suits You,
are helping to create a renais-
sance at Moss. “Things are not
easy but we are going in the
right direction.
“We will be opening
more stores like the one
in Canary Wharf.”
shows no signs of recovery – not
worse or better – while Europe is get-
ting better slowly,” he said.
He added that beer price rises
would be made selectively across
markets, taking into account an
expected “moderate” rise in raw
material input costs, increased com-
petition and its aim to make beer
more affordable in some markets
like Colombia.
Meanwhile the annual dividend
rose 19 per cent to 81 cents a share.
“We expect these solid results at
least to hold the SABMiller share
price at its current level, more than
justifying the premium rating to the
sector with a very impressive rate of
organic growth,” said analyst
Matthew Webb at house broker JP
Morgan Cazenove.
ANALYSIS l SABMiller
2,290.00
2,300 19 May
p Marston’s said the recent strong
2,250
2,200
2,150
2,000
1,950
21 Feb 11 Mar 31 Mar 20 Apr
Chief executive Charles Wilson, a
former Marks & Spencer executive,
said the UK consumer economy was
showing patches of growth but
demand remained extremely volatile.
“It’s the most patchy I’ve ever seen
it. Some markets are growing quite
nicely, London is doing quite well,
some other parts of the country are
very very slow growth or negative,” he
said.
Although Wilson, who owns 7.1 per
cent of Booker, does not expect the
overall wholesale market to improve
BRIAN BRICK
RICHEMONT’S GROWTH FUELLED BY CHINA WATCH BOOST
Marston’s toasts first-half as pub grub
boosts revenues despite tough market
▲
CONSUMER
A SERIES of cheap food offers at pub
group and brewer Marston’s helped it
overcome a challenging market and
notch up a five per cent increase in
profits.
The company made an underlying
pre-tax profit before one-offs of
£29.2m in the six months to 2 April.
16 May Group revenue was up 2.8 per cent at
much in the next couple of years, he
forecast the firm would continue to
prosper.
“There’s a real search for value tak-
ing place, and as a result caterers and
retailers are being more canny in
terms of the way they buy,” he said.
“Booker stock has been re-rated on
merit to our minds. The outlook for
the company in the UK is sound in our
view,” said Shore Capital analyst Clive
Black. Sales at branches open over a
year rose 5.1 per cent, while internet
sales were up 29 per cent to £526m.
Moss Bros sales jump as
debt cleared by Boss sale
▲
RETAIL
SUIT specialist Moss Bros said yester-
day that like-for-like sales were 8.2 per
cent higher for the 15 weeks to 14
May.
Like-for-like gross profit strength-
ened during the period and was 9.8
per cent ahead of last year, the com-
pany said.
The disposal of the Hugo Boss fran-
chise stores for £16.5m has helped the
company become debt free.
The first new format Moss store
£317.9m.
trading had continued into the sec-
ond-half, with like-for-like sales up
five per cent in its managed pub arm
during a nine-week period covering
Mother’s Day and Easter.
The popularity of offers such as two
meals for £10 in its managed pubs
contributed to a ten per cent increase
in the number of main meals it
▲
CONSUMER
DAIRY Crest yesterday said that mar-
ket-beating performances by brands
including Cathedral City cheese and
Country Life butter helped profits
rise five per cent.
The dairy giant reported a seven
per cent rise in sales for its five key
brands, while the volume of milk sold
to major retailers jumped nine per
cent after a new supply deal with
Tesco.
With the company’s milk&more
CITYA.M. 20 MAY 2011
was opened in Canary Wharf on 12
May. This is the first time the three
core fascias of Hire, Retail and
Bespoke have been presented in one
store. The company also said it was
reaping the benefits of a cost cutting
programme.
Chief executive Brian Brick said
store revamps and openings would be
the priority rather than acquisitions.
He added: “The refurbishment of
our stores and a more simple business
model will enable us to focus on the
strengths of the core Moss brand.”
CARTIER watch-
maker Richemont
posted record sales
and profits for its
jewellery and
watch brands in
the year to April.
Sales rose a third
to €6.9bn (£6.1bn),
while pre-tax profit
was 79 per cent
higher at €1bn.
The numbers were
boosted by Net-A-
Porter, the online
fashion business it
bought in April
last year, which
contributed sales
worth €274m.
Sales in the Asia-
Pacific region rose
48 per cent, with
China the star per-
former.
served to more than 12m in the half-
year period.
Average food spend per head rose
to £6.24, driven by a ten per cent rise
in sales of starters and desserts.
Chief executive Ralph Findlay said:
“The performance of the group in the
first-half of the year has been encour-
aging, despite challenging market
conditions and the severe weather in
December.”
doorstep delivery service recording
weekly sales of more than £1m for
the first time, Dairy Crest said profits
adjusted for one-off items rose to
£87.6m in the year to 31 March.
The improvement came despite a
£400m rise in milk costs over the peri-
od, while other commodity input
costs such as vegetable oil, fuel and
packaging are forecast to be around
£25m higher this year.
Dairy Crest shares, which have
risen 14 per cent over the past year,
closed down 1.5 per cent at 401.6p.
 Wealth Management | Markets
CITYA.M. 20 MAY 2011 17

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 Lifestyle
18 CITYA.M. 20 MAY 2011

Pirates series hits the rocks ALSO OUT:

TIMOTHY BARBER

Film reviews
PIRATES OF THE CARIBBEAN:
ON STRANGER TIDES
Cert: 12A
hhIII
IN the fourth episode of Disney’s adventure
franchise everybody is searching for the
Fountain of Youth. But it’s the series itself
that feels long in the tooth, groaning under
the weight of its pointlessly prolonged exis-
tence – pointless, that is, unless you’re a
Disney bean counter, and this doesn’t half
feel like a film put together by spreadsheet.
Thus we have the strangely lifeless sheen
of 3D, since a blockbuster is no longer a
blockbuster unless it’s viewed through plas-
tic goggles; and we have the common ele-
ments of the previous movies – comedy
mugging from Johnny Depp’s Captain Jack
Sparrow, supernatural shenanigans, noisy
action set-pieces, desperately strained story-
lines, an absence of coherence – assembled
and ticked off like items on a shopping list.
Orlando Bloom and Keira Knightley have
gone, not that you notice. Geoffrey Rush
returns as Barbossa, now working for the
British navy, while Ian McShane glowers as
feared pirate Blackbeard and Penelope
Cruz appears as Anjelica, Sparrow’s feisty
former lover who has turned to piracy her-
self. They’re all romping around in the trop-
ics, where mermaids, magical chalices and
Spaniards stand in for a lucid plotline. This
is noisy, joyless pap. It’s time Jack Sparrow
walked the plank. Timothy Barber
WIN WIN
Cert: 15
hhhhI
DVD
MIKE (Paul Giamatti) is a struggling small
town lawyer and part-time wrestling coach.
When he sees an opportunity to become BLACK SWAN Natalie Portman on Oscar form
the registered guardian for one of his elder- in Darren Aronofsky’s psychological thriller.
ly clients – and bag the $1,500 a month that
comes with it – he jumps at the chance. But THE WALKING DEAD SEASON 1 Surprisingly
his new ward’s abandoned grandson, Kyle effective US TV hit with Brit Andrew Lincoln.
(Alex Shaffer), appears out of nowhere, and
Mike feels obliged to take care of him. At THE NEXT THREE DAYS Formulaic thriller
Above, Johnny Depp first, everything runs smoothly – Kyle with Russell Crowe.
with Penelope Cruz in becomes one of the family, starts school
and destroys all in his path in the wrestling
the ailing franchise
ring – until his fresh-from-rehab negligent
mother turns up and tries to take him
back.
Win Win perfectly strikes the balance
between poignant family drama and
laugh-out-loud comedy. From the outset,
Mike makes dubious moral decisions. He GAMES
misleads his elderly client, exploits his
position for easy money, and petitions to
keep hold of Kyle because, importantly, L.A. NOIRE (PS3, X360) 1950s Los Angeles
the boy adds value to his hopeless gangsterland is brought to scintillating life.
wrestling troupe. And, thankfully, there is
no saccharine, happy ending. It’s these THE WITCHER 2: ASSASSINS OF KINGS
complexities and layers that make it a cut (PC) Swords and sorcery role-player sequel.
above the vast majority of mainstream
“indie” comedies of the last few years. FABLE III (X360) Role-player set in the land
Tom Latter of Albion.

Chelsea in bloom as
Flower Show lands
Lucie Greene rounds
up the best to come as
the gardening event of
the year launches

A
LL those months of composting are
coming to fruition as the RHS
Chelsea Flower Show arrives. From
Tuesday the area will be in full
bloom with the world’s finest gardening
talent on display. City A.M. rounded up six
of the show’s hotly-tipped highlights.
AUSTRALIA GARDEN
This marks the debut for the Royal Botanic
Gardens Melbourne at Chelsea, which is introduc-
ing the ‘The Australian Garden’, by Jim Fogarty. It’s
been inspired by a journey from the Australian out-
back, through the rivers to the urban East Coast of
the country. The designer has used all Australian
native varieties, with the hope of inspiring Brits to
try growing Aussie varieties in their own gardens.
www.rbg.vic.gov.au/australian-garden
LAURENT PERRIER
Japanese architect Kengo Kuma and British sculp-
tor Peter Randell have come together on this
romantic garden inspired by Perrier colours. (The
perfect inspiration for fizz after.)
www.laurent-perrier.co.uk
THE MONACO GARDEN
The Principality of Monaco exhibits for the first time with a
garden inspired by Monaco’s architecture and landscape, creat-
ed by award-winning landscape designer Sarah Eberle.
www.gouv.mc
THE B&Q GARDEN
Created by Laurie Chetwood and
Patrick Collins, B&Q’s garden will be
the tallest ever to exhibit at the
show, a giant eight meter high living
wall, where everything planted on
it– from the chilies, to the tomatoes,
herbs and flowers – will be edible
and supported by its own compost-
ing and watering system. The piece
has been designed, B&Q says, to
champion self-sufficiency in urban
settings, demonstrating how plants
can be grown in tight spaces using
vertical planting and other solutions.
Fans who didn’t get tickets for the
show needn’t miss out, either. To
partner the event, B&Q is staging a
coup at Trafalgar Square. From 6.30
am this morning a group of B&Q
staff, dressed in tomato costumes,
will be handing out 100,000 free
tomato plants to commuters. There’s
no excuse to shun the vegetable
patch now.
www.diy.com
M&G GARDEN
Multiple gold medal winner Bunny Guinness
returns after an eight-year absence to design M&G
Investments’ garden exhibit, left, a chic modern
take on a kitchen garden with rows of cabbages,
fruit, herbs and flowers all integrated to an elegant
space. “I wanted to create something that was
beautiful but fully functioning,” says Guinness of
the design which also features a floating glass
platform and seating around a working alfresco
fireplace. www.mandgchelsea.co.uk
WIN TICKETS
Tickets have sold out, but title sponsor M&G is
offering two pairs to City A.M. readers for
Friday 27th. Enter the prize draw by answering
JANE PACKER the question: “What anniversary is the RHS
Chelsea Flower Show celebrating this year?”
Celebrity florist Jane Packer counts everyone from
Email answers by midday Monday, May 23rd, to:
The Prince of Wales to Victoria Beckham among
mandgchelsea@wildcard.co.uk
her fans and is staging a live flower arranging
Contact: WildCard, www.wildcard.co.uk for full
demonstration on Tuesday 24th, displaying how to
terms and conditions.
make up several of her signature bouquets.
www.mandgchelsea.co.uk
www.jane-packer.co.uk
CITYA.M. 20 MAY 2011 Lifestyle | TV& Games 19

BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5 TV PICK

TERRESTRIAL
6pm BBC News
6.30pm BBC London News
7pm The One Show: BBC News
8pm EastEnders
8.30pm A Question of Sport
9pm Have I Got News for You
9.30pm Outnumbered
10pm BBC News 10.25pm
Regional News 10.35pm The
Graham Norton Show 11.20pm The
National Lottery Friday Night
Draws 11.30pm FILM Ransom:
1996. 1.25am The One Show;
Weatherview 2.30am Sign Zone:
Monty Don’s Italian Gardens
3.30am Sign Zone: The Hairy
Bikers: Mums Know Best
4.30am-6am BBC News
6pm Eggheads
6.30pm Great British Menu
7pm Windfarm Wars
8pm Petworth House –
The Big Spring Clean
8.30pm Gardeners’ World
9pm CHOICE Dirk Gently
10pm Frank Skinner’s
Opinionated
10.30pm Newsnight
11pm The Review Show:
Weather
11.50pm Later with Jools
Holland
12.55am FILM The Wave. 2008.
2.35am BBC News 4.30am Close
5.55am-6am Wibbly Pig
6pm London Tonight
6.30pm ITV News
7pm Emmerdale
7.30pm Coronation Street
8pm CHOICE
Baboons with Bill Bailey
8.30pm Coronation Street
9pm Paul O’Grady Live: With
Matt Lucas, Michael Ball,
Westlife and Katherine Kelly.
10pm ITV News at Ten
10.30pm London News
10.35pm The Cube
11.35pm Take Me Out
12.35am The Zone; ITV News
Headlines 2.35am In Plain Sight
3.25am-5.30am ITV Nightscreen
6pm The Simpsons 6pm Home and Away
6.30pm Hollyoaks 6.25pm OK! TV
7pm Channel 4 News 7pm 5 News at 7
7.30pm Unreported World 7.30pm Fifth Gear;
7.55pm 4thought.tv 5 News Update
8pm A Place in the Sun: 8pm Eddie Stobart: Trucks and
Home or Away Trailers; 5 News at 9
9pm The Million Pound Drop Live 9pm CHOICE The Mentalist:
10.25pm That Peter Kay Thing
A prison guard is murdered.
10.55pm PhoneShop 11.30pm The DIRK GENTLY
Ricky Gervais Show 12am Comedy 10pm Law & Order BBC2, 9PM
Gala: Best Bits 1.05am Music on 4: 11pm The Walking Dead Drama, starring Stephen Mangan
Foo Fighters: A New Light 1.30am 12am SuperCasino as Douglas Adams’ holistic
My Name Is Earl 1.55am My Name 4.05am Motorsport Mundial: High- detective, who focuses on the
Is Earl 2.15am Ugly Betty 3.05am speed coverage. 4.30am Fifth Gear interconnectedness of all things.
Barbarians 4.05am Wild Thing I 4.55am Rough Guide to Eco
Love You 5am Wogan’s Perfect Escapes 5.10am Wildlife SOS
Recall 5.25am-6.10am Countdown 5.35am-6am House Doctor

SKY SPORTS 1 Tour Golf 11pm European Tour Golf Crime Scene Investigation 1.50am E4 Planet 5.30am-6am Destroyed in
SATELLITE & CABLE

7pm Sky Sports News at Seven
7.30pm Live Football League
10pm Big Fight Countdown
10.30pm Take It Like a Fan 11pm
Premier League Preview 11.30pm
Take It Like a Fan 12am Football
League 1.30am Big Fight
Countdown 2am Take It Like a Fan
2.30am Premier League Preview
3am Trans World Sport 4am
Football League 5.30am-6am
Take It Like a Fan
SKY SPORTS 2
7pm Road to London 7.30pm Live
European Challenge Cup Final
10pm Tight Lines 11pm NFL: Total
Access 12am European Challenge
Cup Final 1.30am Tight Lines
2.30am NFL: Total Access 3.30am
European Challenge Cup Final
5am Kings Of The Extreme
5.30am-6am Road to London
SKY SPORTS 3
7pm Tight Lines 8pm Live PGA
1am PGA Tour Golf 4am Tight
Lines 5am-6am Racemax
BRITISH EUROSPORT
6.25pm Tennis 7.25pm Tennis:
Mats Point 8pm Cycling: Giro
d’Italia 9pm Cycling 10.05pm
Live Cycling 12am-12.30am
Cycling: Giro d’Italia
ESPN
7.30pm WRC Rally World 8.30pm
NBA 10.45pm ESPN MMA Live
11.30pm Premier League Preview
12am Live Major League Baseball
3am This Week in Baseball
3.30am Premier League Preview
4am ESPN MMA Live 4.45am
The Ultimate Fighter 5.45am-6am
ESPN Kicks: Extra
SKY LIVING
7pm CSI: Crime Scene
Investigation 8pm Bones 9pm
Criminal Minds 10pm CSI: Miami
11pm Criminal Minds 12am CSI:
Ghost Whisperer 3.30am
Charmed 4.20am Nothing to
Declare 5.10am-6am Maury
BBC THREE
7pm Doctor Who: The Doctor
meets an old friend. 7.45pm
Doctor Who Confidential: Fantasy
author Neil Gaiman leads a tour of
the Tardis. 8pm Snog, Marry,
Avoid? 9pm Two Pints of Lager
and a Packet of Crisps 9.30pm Lee
Nelson’s Well Good Show 10pm
EastEnders: Ronnie tries to explain
her actions to Jack. 10.30pm
Young, Rich and Househunting
11pm Family Guy 11.50pm Two
Pints of Lager and a Packet of
Crisps 12.20am Lee Nelson’s Well
Good Show 12.50am Secrets of
the Superbrands: Technology
1.50am Bizarre ER 2.20am Snog,
Marry, Avoid? 3.20am Doctor
Who 4.05am Doctor Who
Confidential 4.20am
Young, Rich and Househunting
4.50am-5.20am Bizarre ER
7pm Hollyoaks 7.30pm Friends Seconds
9pm Supersize vs Superskinny
10pm Embarrassing Teenage DISCOVERY HOME &
Bodies 11.05pm Made in Chelsea HEALTH
12.10am My Name Is Earl 1.10am
Supersize vs Superskinny 2.05am
7pm Bringing Home Baby 8pm 10 BABOONS WITH BILL BAILEY
Years Younger 9pm 19 Kids and ITV1, 8PM
Embarrassing Teenage Bodies 3am Counting 10pm Little People, Big
Fred and the rest of the Smitz baboons
Ugly Betty 3.40am Heartland World 11pm I Didn’t Know I Was
prepare to defend their home on the
4.25am-6am Switched Pregnant 12am 19 Kids and
coast road from a neighbouring troop
Counting 1am Little People, Big
HISTORY World 2am I Didn’t Know I Was
led by alpha male TK1.
7pm Heir Hunters 8pm Storage Pregnant 3am 10 Years Younger
Wars 9pm American Pickers 4am The Baby Lab 5am-6am
10pm Ancient Aliens 11pm The Bringing Home Baby
True Story 1am How London Was
Built 2am How Britain Was Built SKY1
3am Heir Hunters 4am Universe 7.30pm The Middle 8pm The
5am-6am Ice Road Truckers Simpsons 8.30pm Modern Family
9pm Raising Hope 9.30pm A
DISCOVERY League of Their Own: Best of
8pm Britain’s Toughest Cops 9pm 10.30pm Spartacus: Blood and THE MENTALIST
Whale Wars 10pm When Aliens Sand 11.45pm Ross Kemp 1.45am CHANNEL5, 9PM
Attack 12am Are UFOs Real? 2am Night Cops 2.40am Cold Case Jane suspects that a state prison
Future Weapons 3am Hitler’s 3.30am The 4400 4.15am Secret inmate is to blame for the murder of a
Henchmen 3.50am World War Life of Suburbia 5.10am-6am guard outside a shop. Crime drama,
One in Colour 4.40am Raging Don’t Forget the Lyrics starring Simon Baker.

COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk

QUICK CROSSWORD
    

SUDOKU KAKURO
15 28 9 14 31 28
13 11 14
10 
9 7 10
Place the numbers from 1 to 9 in each empty cell so that each 16 16 
row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 22 11
14 15
from 1 to 9 to solve this tricky Sudoku puzzle. adds up to the total in the box 24 35
   
above or to the left of it. 27
You can only use the digits 1-9 4 10    
    and you must not use the
23 26 23
45  
same digit twice in a block.
  The same digit may occur 16 8 
9 30 5
 more than once in a row or
column, but it must be in a
34
19
17

12 20
     separate block.
3 17
11 6 12
  8 9 10
 

     ACROSS DOWN
1 Cricketing trophy (5) 1 Spanish fortress

  WORDWHEEL N K
4 Greta ___, film star
(1905-1990) (5)
or palace built by
the Moors (7)
2 City in Germany on
Using only the letters in the Wordwheel, you have 7 Annual publication
    ten minutes to find as many words as possible,
A H giving weather the Elbe River (7)
3 Commence (5)
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters H forecasts, etc (7)
8 Deep yellow colour (5) 5 Major river of Brazil (6)
LAST ISSUE’S or more, all must contain the central letter and
letters can only be used once in every word. There
A E 9 Cavalryman (7) 6 Favouring one person
SOLUTIONS KAKURO is at least one nine-letter word in the wheel.
S D 13 City, site of the
Taj Mahal (4)
or side over another (6)
10 Male sheep (3)
QUICK CROSSWORD 7 9 1 9 8 5 9 16 Bulge or swelling (4) 11 Have (7)
U P P E R C A S E
6 1 3 4 6 5 2 1 SUDOKU          17 Music of the early 12 Acknowledgment
8 6 2 5 9 8 4
A I R O A J         
9 8 4 6 7 9 1 2 20th century (7) that payment has
L L A M A D E L T A         
3 7 9 8 3 1 been made (7)
P N S E E S C
         19 Church passage (5)
E L O P E D R A N K 7 3 1 2 9 8 7 4
14 Gather, as of crops (6)
WORDWHEEL
N E I F          20 Continuous (7)
8 6 4 8 5 3
H Y E N A A M O U R         
9 7 3 9 6 7 5 8 15 In one’s place of
O A L A D M O          21 Carrying weapons (5)
R U R A L D R E G S
9 1 3 4 1 2 5 The nine-letter word was residence (2,4)
N T O E G T 3 8 4 6 9 7 3 9          22 Adjust again after
S H O W T R I A L 1 5 1 3 2 1 7
SANDPIPER          18 Enthusiastic (5)
an initial failure (5)
 Living
20
How to become George Clooney’s neighbour
Living among Hollywood stars on Lake
Como is actually achievable if you look in
the right places, writes Donata Huggins
N
ABBING a sneaky peak of George
Clooney sun bathing is surely price-
less. And yet after some investigation,
it turns out it might not be as expen-
sive as you’d think. For the sum of €850,000
you could actually own the apartment next
door to Clooney on Lake Como – an apart-
ment that benefits from views directly into
his garden.
Don’t let the low price of this apartment
fool you though. Clooney is not on an aus-
terity drive. His villa cost him a whopping
$10m in 2002. Not to mention that other
Forbes Rich List favourites Richard Branson,
and IKEA’s Ingvar Kamprad live nearby. This
is truly a lakeside microclimate for the
mega-wealthy. Their lakeside mansions usu-
ally go for £10-15,000 per sqm, while those
willing to be set back slightly from the
water front will find their homes cost-
ing £6-10,000 per sqm. And, while
Local Italian estate agents might quote
cheaper prices, not all of the homes
they offer are suitable for the decisive
international buyer.
These average prices might
seem unaffordable, but little
gems like the apartment next
to Clooney’s do crop up. At
€150 per sqm, on the lake-
front home, the apartment
is discounted only because it
needs to be redecorated.
Finding these deals is simply a mat-
ter of knowing where to look.
Paul Belcher, the owner of the
Ultissimo an Italian property
search firm, is a man who knows.
He set up the business four years
ago after buying a number of
homes in Umbria and hitting a
brick wall of Italian bureaucracy. “I
found out that you needed a lot of
patience to learn how to work
around it,” says Belcher. He set up
the business to remedy this prob-
lem for the international market.
Belcher’s ability to spot a bar-
gain is down to a small army of
contacts and little aversion to
knocking on strangers’ doors.
“The property prices around
Como can be totally illogical since
CITYA.M. 20 MAY 2011
| Abroad
so much changes hands privately,” he says.
Villa Peduzzi is another shining example
of the opportunities available. The property
is rumoured to be the only Liberty villa left
on the market. Built in 1909 by the famous
engineer Rocco Peduzzi, it was left discard-
ed by the family for the last 50 years.
Belcher is redeveloping the site, dividing it
into two four-bedroom apartments with a
swimming pool and a view to die for (see
right). The fact that the property is set up on
the hillside rather than on the water front
means that the whopping 300 per sqm-
downstairs apartment is going for just
£3.8m. New builds on the hillside can also
offer the international buyer a great price.
Villa Carolina has incredible lake views and
is just €625,000, that’s £6,500 per sqm.
Properties around the lake are certainly
worth investing in. Chesterton Humberts’s
international expert Andrew Hawkins says:
“Much like the prime central London mar-
ket around Mayfair, the prices in Como
never really suffered in the recession and
strong international interest keeps
many of the problems that blight
the rest of the Italian market at
bay. The prices have climbed
steadily this year and last.” The view of Lake Como from Villa Peduzzi. The property is available from Ultissimo at £3.8m, www.ultissimo.com.
The rental opportunities
are excellent too. Beverley
Rosen, a British ex-pat in
Como is renting her four-bed-
room hillside property for €4,000
per week this summer. While her
property does have a great lake view
and a swimming pool, the figure
she could earn pales in comparison
to properties on the lake front.
The trick to finding the right prop-
erty is simply not be fooled into spot-
ting a bargain too quickly. Belcher
says: “The Western shore is favoured
for a reason. It gets stacks of sunshine
and has good transport links. Road
noise also spoils many properties.
Italians buyers do not seem to mind
this, but this stuff can quickly impact
on the owner’s ability to sell or rent.”
Becoming Clooney’s neighbour is
not such an arduous or expensive
task. All you need is a bit of insider The view into Clooney’s villa from the apartment for sale Villa Peduzzi, see www.ultissimo.com
gossip. next door. www.ultissimo.com
 WESTBOURNE TERRACE
BAYSWATER, W2
A two bedroom, two bathroom period
conversion in a beautiful tree-lined
terrace and close to Lancaster Gate
and Paddington train stations.
• Period Conversion
• Good Condition
• Fourth Floor with Lift
• Good Transport Links

£650,000 – Share of Freehold

Sole Agents
Hyde Park & Bayswater
020 7262 2030

LUXBOROUGH STREET
MARYLEBONE, W1
A raised ground floor flat within this
small modern purpose built block
situated almost adjacent to Marylebone
High Street.
WEST END QUAY, PADDINGTON, W2 • One Bedroom
• One Bathroom
A beautifully presented three bedroom, two bathroom flat within the highly • Good Condition
desirable Peninsula Apartments overlooking the Paddington Basin. • Close to Marylebone High Street

Refurbished • Private Balcony • Underground Parking Space • Porter £600,000 – Share of Freehold
£1,150,000 – Leasehold – Sole Agents Marylebone & Regent’s Park
020 7486 6338
Hyde Park & Bayswater 020 7262 2030

London Estate Agents | Investment & Development Consultants | Block Managers | Established 1982 kayandco.com

The Height of Shoreditch Living

Located on Bethnal Green Road just 75m from the new Shoreditch High Street
Station and moments from Bishopsgate and The City.

LONDON LAUNCH 19 - 21 MAY TH ST

at RICHMIX PENTHOUSE SUITE, 35 - 47 BETHNAL GREEN ROAD E1

Call or see website for details.

• An entrance foyer to rival the very best boutique hotel

• Uniquely Shoreditch interior styling & comfort cooling to all apartments
• 24 hour concierge & private residents’ gymnasium
• “Free Spirit Garden”, landscaped squares and private residents’ roof terrace

Selling Agents:
www.avantgardetower.com
0800 883 8953
CGI of Avant-garde exterior (left), the entrance foyer (centre) and selected apartment interior (above right).
 22 Living | Focus On CITYA.M. 20 MAY 2011

BUY
KENNINGTON, SW9 BY DONATA HUGGINS

RAVENSDON
STREET
Price: £850,000
This three-storey early
Victorian house has
three bedrooms, a gar-
den and balcony. The
house is well decorated
and retains some of its
period features.
Contact: Kinleigh
Folkard & Hayward’s
Kennington branch on
020 7582 7773 or go to
www.kfh.co.uk
CHESTER WAY
Price: £350,000
This Victorian one bed-
room flat has a south-fac-
ing garden, a reception
and kitchen-breakfast
room. It is well decorated
with stripped wooden
flooring throughout.
Contact: Kinleigh Folkard
AMELIA STREET & Hayward’s Kennington
Price: £280,000 branch on 020 7582
This one-bedroom first floor flat is located close to Elephant and Castle’s 7773 or go to
shops and transport links. It has a large, well-lit living room, kitchen and www.kfh.co.uk
bathroom.
Contact: Foxtons on 020 7801 1111 or go to www.foxtons.co.uk
Camilla
Dell
MANAGING
PARTNER OF BLACK
BRICK PROPERTY
SOLUTIONS
I am thinking of buying a
Q. second home in the coun-
try. I’ve found something
really lovely, but the house has
been on the market for over a
year. Should I be worried?
A.
Don’t panic, the country
house market is very different
from central London. Prices
are far more susceptible to falls, pri-
marily due to less international
demand, tight lending conditions,
spending cuts and the overall health
of the UK economy. We have seen
many houses and country estates
outside of London stay on the market
for months and we have watched the
price fall. We recently sourced a prop-
erty for a client in Henley, which was
initially marketed at £6m. We ended
up securing it for just over £2m. The
time is definitely right to buy a home
outside London. There isn’t much
competition from foreign buyers so
owners keen to sell are more open to
accepting offers. Of course, there will
always be the “hot spots” that are
recession proof. Rock in Cornwall,
Sandbanks in Dorset and Salcombe in
Devon, for example, are still tight
markets to buy into and the prices
haven’t fallen much.

PROPERTY NEWS
BY DONATA HUGGINS

SHOREDITCH GOES AVANT-GARDE
Telford Homes have just launched a new cutting edge resi-
dential development in Shoreditch. It has been designed by
architect Stock Woolstencroft to include a communal “Free
Spirit Garden.” Prices start at £250,000.
BOUTIQUE ESTATE AGENT TO OPEN IN BELGRAVIA
Quintessentially Estates plan to open a boutique estate agency in
Belgravia. It is due to open this summer and will specialise in the
sale and letting of high-end residential and commercial proper-
ties in central London and Europe.
ASKING PRICES DROP AT THE FASTEST RATE IN OVER A YEAR
This month house sellers have dropped their asking prices at the
fastest rate in over a year, according to the research by
Zoopla.co.uk. The average price reduction since first listing now
stands at £18,970, nearly £500 more than three months ago.
 Punter
RACING TRADER BILL ESDAILE, OUR RACING EXPERT, VISITS NEWMARKET
TO SEE INVESTEC DERBY FAVOURITE CARLTON HOUSE

A horse fit for a Queen

THE Investec Derby is just over two weeks
away and the world’s greatest flat race,
held at Epsom for over 200 years, may be
about to have its most famous winner.
Carlton House, bred by Sheikh
Mohammed’s Darley Stud operation and
the red-hot 7/4 favourite with William Hill
to land the mile and a half classic, is
owned by the Queen. Her Majesty will be
attempting to land racing’s most famous
prize (Aureole’s second place finish in
1953 is her best attempt to date) with her
10th runner, but the feeling is she may
finally have found the key to the treasured
prize in her 86th year.
The son of Street Cry looked a picture of
Overdose may
health as he was put through his paces in
glorious sunshine on Newmarket Heath
yesterday morning, but his handler Sir
Michael Stoute isn’t distracted by the
struggle against
added media attention and expectation.
“Of course I’m aware of the interest in this
fellow,” he tells me, “but hopefully the
horse isn’t.”
Stoute saddled Shergar to victory in the
better opposition
Derby exactly 30 years ago but won’t be ALL eyes will be on Hungarian superstar Overdose as he
drawn on any comparisons on pre-race has his first real test back from injury in tomorrow’s
pressure. Anyway, he’s now saddled five Temple Stakes at Haydock (3.00pm)
winners of the world’s premier race and The six-year-old grabbed the headlines when bolting up
you get the feeling that he reckons num- in the voided Prix de l’Abbaye on Arc day back in 2008, but
ber six is within touching distance. “He’s injury has only seen him make the racecourse six times
got a good temperament, a good mind since. His reappearance after 231 days on the sidelines at
and a turn of foot,” he reassures me. Hoppegarten last month proved nothing except for the
The Dante at York was a slowly run race fact that he has four legs. He is quite literally thrown back
which Stoute admits is never conclusive. in the deep end here on ground that is bound to be too
“How good a performance it was we just quick for him. He is a 2/1 shot with William Hill and I’d
don’t know,” he warns. “However, he was far rather be a layer than a backer on Betdaq.
in good form going into it and has come Finding one to beat him is a little harder as these sprint-
through it really well.” ers seem to take winning in turns. However, Irish raider
Carlton House will be ridden on the big SOLE POWER ran an eye-catcher in the Palace House at
day by last year’s winning jockey Ryan Newmarket last time and proved that last year’s
Moore who was also present alongside Nunthorpe win was no fluke. He looks a decent each-way
Stoute on the Heath. The shy, but hugely proposition at 12/1 with William Hill.
talented former champion jockey has rid- Yet, the best bet of the weekend looks to be the Michael
den for the Queen since he was 18 years Bell-trained two-year-old APOSTLE in York’s 4.15pm
old and isn’t fazed by the assignment. “I’ll tomorrow. The grey son of Dark Angel is really well
treat it just like any other race, riding for Investec Derby favourite Carlton House (orange cap) exercising at Newmarket yesterday morning regarded at home and is expected to take this on his way
any other owner. I have ridden for Her to Royal Ascot.
Majesty for a long time now and I’m at up on the Queen’s colt and feels he has every quite simply the biggest race in the world.” Richard Hannon won last year’s Irish 2,000 Guineas with
ease with her.” reason to be confident. At the same time he Don’t forget to download Epsom’s iPhone Canford Cliffs and he relies on Dubawi Gold in tomor-
Trying to compare last year’s winner reminded me that, “it’s only a horse race” App before you attend the Investec Derby row’s renewal (3.45pm). He’s the 7/4 favourite with
Workforce with Carlton House isn’t easy and “what will be, will be.” Festival. From racecards to latest odds and William Hill, but I think he was flattered to finish so close
as the former is far bigger and probably Yet, he freely admits that the Investec Derby results to videos and photos, it has all the to Frankel last time. The one to back is Kevin Prendergast’s
doesn’t have the agility of the young pre- is the race that every jockey wants to win. information you’ll ever need. DUNBOYNE EXPRESS at 5/2 who has won three of his four
tender. However, Moore is relishing the leg “The Derby is the Derby,” he stresses. “It is You can follow me on Twitter @BillEsdaile. career starts and should relish the forecast conditions.

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 24 Punter | Sport CITYA.M. 20 MAY 2011

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PREMIER LEAGUE CLIMAX AND RUGBY UNION’S HEINEKEN CUP FINAL

Champions to round off

league campaign in style
THE Premier League season comes to an
end on Sunday and there are still some
scores to be settled at the bottom of the
table. However, MANCHESTER UNITED
were crowned champions at Blackburn
last weekend and they thoroughly deserve
their 19th league title. It couldn’t be
described as a vintage United team, but
they have ground out results when it mat-
tered and their home form has been out-
standing.
There is no doubt that Sir Alex Ferguson
will field a weakened team against relega-
tion-threatened Blackpool with the
Champions League final less than a week
away, but he did the same against Schalke
in the semi-final and his side still won 4-1.
He has a strong squad at his disposal and
the fringe players will want to impress.
United have won 17 of their 18 home
league games this season with 15 of them
coming by the HT / FT double result. Ian
Holloway’s Blackpool will obviously be up
for this one, but they don’t have the quali-
ty of their counterparts and the United HT
/ FT result is massive at 6/4 with Paddy
Power.
Charles N’Zogbia’s injury time winner
against West Ham last Sunday gave
WIGAN a lifeline and Roberto Martinez
knows that another victory at Stoke this
Sunday will more than likely preserve his
side’s top flight status. The Potters have an Tottenham might not be enough to guaran- worth backing.
excellent home record, but they have had tee safety. Finally, in the Bolton v Man City game, I
a tough week, losing out twice to Spurs, meanwhile, need a victory to ensure can’t resist BUYING TOTAL GOALS at 3.1 with
Manchester City. they remain in fifth place and that seems Sporting Index. There have been at least three
Tony Pulis’ men have had another strong likely considering their strong record at goals in eight of Bolton’s last nine home
season, but there is every chance they will White Hart Lane. However, I’d rather back matches against top-six sides and a minimum
still be suffering from an FA Cup hangover Blues to go down at 7/10 than Spurs to win of four in seven of those.
and Wigan look decent at 13/10 with the game at 8/15.
William Hill. Arsenal will be hoping that Bolton can do
If Wigan manage to win at Stoke, or even them a favour against Man City, but I actually POINTERS...
take a point, then BIRMINGHAM could be think they’ll have problems themselves
doomed and they are the value bet at 7/10 against FULHAM at Craven Cottage. The Man United HT / FT at 6/4 with Paddy Power
with Victor Chandler to be relegated. Alex Gunners’ confidence has evaporated in recent Wigan at 13/10 with William Hill
McLeish’s outfit are in freefall, having weeks and although the Cottagers were Fulham at 3/1 on Betdaq
taken just one point from their last five stuffed by Liverpool recently, they are a strong Buy goals in Bolton v Man City at 3.1 with Sporting Index
games, and they know that even a win at side on home soil. At 3/1 on Betdaq they are Birmingham to be relegated at 7/10 with Victor Chandler

Leinster too strong for Mallinder’s Saints

LEINSTER
NORTHAMPTON
TOMORROW - 5PM, SKY SPORTS
FEW, other than perhaps the most partisan
Frenchman, would argue that the two most
deserving sides will meet in tomorrow’s
Heineken Cup Final. That story is told by the
judges’ selections for the European Player of
the Year: Leinster’s Sean O’Brien, Jamie
Heaslip and Isa Nacewa and Northampton
Saints’ Soane Tonga’uiha make up four of the
five-strong shortlist.
Saints are looking to make it a flawless
nine wins from nine matches in this year’s
tournament, but there is more to suggest
that Leinster will prevail at the Millennium
Stadium.
Leo Cullen’s team have done things the
hard way, beating English Champions
Leicester Tigers in the quarter-finals and cur-
rent Heineken Cup holders Toulouse in the
semis. A 24-8 pool stage victory over French
title holders Clermont Auvergne - in which
the province produced perhaps the finest
performance by any team in this year’s com-
petition - completes a trio of triumphs
against Europe’s best club sides. The Irish
side are as short as 3/10 for victory - I cannot
disagree and suggest backing Leinster to win
with a five point handicap at evens with
Victor Chandler.
Under Jim Mallinder’s tutelage,
Northampton have gone from strength to
strength since 2007 but, although they won
the trophy in 2000, a European final is very
much unchartered territory for most of the
current crop of players. As a team, their oppo-
nents have a distinct experience advantage
having won the tournament two years ago,
while a significant number of key personnel
- the inspirational Brian O’Driscoll included,
who will surely play despite a minor knee
injury - have also enjoyed success with coun-
try as well as club.
For all their ability to play open rugby,
Leinster’s most impressive victories this year
have been built around supremacy in the
pack and a disciplined lineout. England
flanker Tom Wood’s absence is, therefore, a
massive blow for the underdogs and will pile
even more pressure on Saints second-row
Courtney Lawes, who will have his hands full
trying to keep tabs on powerhouses O’Brien
and Heaslip.
The Premiership side face another disad-
vantage in the scheduling of recent matches
and Mallinder would certainly have wished
for more time to recover from a brutal 11-3
defeat to Leicester just seven days ago.
Leinster will look to capitalise on any slug-
gishness and stamp their authority early on.
Leinster to lead at the break and at fulltime is
a good bet at 4/5 with William Hill.
The past six Heineken Cup Finals have aver-
aged 34 points with a highest combined
score of 42 in that sample and selling points
with Sporting Index at 39 appears the right
course of action this time. The wind is
expected to get up which could prove a hin-
drance to goal kickers Johnny Sexton and
Steve Myler and the quality of both teams in
midfield leads me to expect a tightly fought,
low scoring outcome.
POINTERS...
Leinster to win with 5 point handicap at EVS with Victor
Chandler
Leinster HT/FT at 4/5 with William Hill
Sell total match points at 39 with Sporting Index
 Sport
Blues and Blackpool to join Hammers
FOOTBALL COMMENT
TREVOR STEVEN
T
HERE are any number of per-
mutations heading into what
promises to be a fascinating
finale to the season but you get
what you deserve after a 38-game
campaign, and ultimately for the two
FA won’t vote
for Blatter or
Bin Hammam
▲
FOOTBALL
BY JAMES GOLDMAN
THE FOOTBALL ASSOCIATION has
opted to abstain from the vote for the
Fifa presidency.
Sepp Blatter, seeking a fourth con-
secutive term of office, has been chal-
lenged by Qatari Mohamed Bin
Hammam, the president of the Asian
Football Confederation.
But the FA has decided not to cast a
vote in light of the recent corruption
allegations aimed at the world gov-
erning body.
“The FA board has today [Thursday]
agreed to abstain in the vote of the
presidency of Fifa,” read a statement.
“There are a well-reported range of
teams who will join already demoted
West Ham in the Championship next
season there can be no excuses.
BLACKBURN
The record books will show the deci-
sion to axe Sam Allardyce wasn’t a
costly a one. However, I think Rovers
will survive by default, Steve Kean
has accomplished nothing to sug-
gest he’s got the ability to push
Blackburn on. VERDICT: SAFE
WOLVES
In contrast to Kean, Wolves are likely
to stay up as a result of the work
undertaken by Mick McCarthy, an
issues both recent and current which,
in the view of the FA board, make it
difficult to support either candidate.
“The FA values its relationships
with its international partners very
highly. We are determined to play an
active and influential role through
our representation within both Uefa
and Fifa.
“We will continue to work hard to
bring about any changes we think
would benefit all of international
football.”
Before the FA took its decision to
abstain, Blatter had stated: “I think it
is a little bit strange when the No1
association in the world have two can-
didates in front of them and cannot
make a decision.”
“WINNING WOULD BE REWARD 25
FOR THOSE WHO STUCK BY US”
CARE LOOKS TO PUT BLOODGATE TO BED
WITH CHALLENGE CUP FINAL WIN: P26
SPORT | IN BRIEF
Morgan outshines Bopara
CRICKET: Eoin Morgan struck an
unbeaten 156 for England’s Lions
underrated operator. VERDICT: SAFE one wanting the Seasiders to go against Sri Lanka to underline his case
down but whatever XI Manchester for selection in next week’s first Test.
WIGAN United put out it will be too strong Samit Patel also reached three figures,
Stoke look as though they’ve for Ian Holloway’s men. scoring 101 not out as England’s second
switched off for the season and VERDICT: GOING DOWN string reached 394-4 at the close.
Wigan have enough firepower to Earlier Ravi Bopara, Morgan’s main rival
ensure they get the result they
require. VERDICT: SAFE BOTTOM SIX in the fight to replace the retired Paul
Collingwood, made a scratchy 17.
TEAM PLD W D L F A PTS
BIRMINGHAM Wins for Donald and Westwood
Blues were a shambles against
Blackburn
Wolves
37 10 10 17 43 57 40
37 11 7 19 44 63 40
GOLF: England’s Lee Westwood and
Fulham, have the least mobile mid- Luke Donald recorded comprehensive
field in the league and I can’t see Birmingham 37 8 15 14 36 56 39 victories in their opening games at the
them getting anything at Spurs. World Match Play Championship in
VERDICT: GOING DOWN Blackpool 37 10 9 18 53 74 39 Marbella. Westwood beat Denmark’s
Wigan 37 8 15 14 39 61 39 Anders Hansen 6&5, while countryman
BLACKPOOL Donald defeated American Ryan Moore
You’d be hard pressed to find some- West Ham 37 7 12 18 43 67 33 4&3.
Change of opponent for Cleverly
BOXING: WBO light-heavyweight cham-
STAYING PUT: WENGER TO KEEP FABREGAS pion Nathan Cleverly will fight Poland’s
Aleksy Kuziemski tomorrow night after
another change of opponent with Tony
Bellew failing to make the weight.
Results
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+*#( CN\jknff[Yk(- 8?Xej\e;\e -,%
IL>9PC<8>L<
K?<:F$FG<I8K@M<:?8DG@FEJ?@G19Xkc\p,'Pfib(-%
IL>9PLE@FE
GI@E:@G8C@KP9L@C;@E>JF:@<KPGC8P$F===@E8C
Gfekpgi`[[%%%%%%%%%%%%%%%%%%%%%%%% (/ CcXe\cc`%%%%%%%%%%%%%%%%%%%%%%%%%%%%% )+%
KF;8PËJ;@8IP
=ffkYXcc.%+,gdlec\jjjkXk\[
ARSENAL boss Arsene Wenger insists he is planning for captain Cesc Fabregas to remain egfn\iC^\KnfGcXp$F]]jJ\d`$=`eXcjJ\Zfe[C\^
at the club, despite speculation of a move to Barcelona. “I expect him to be here,” said 8ZZi`e^kfeJkXec\p' mJk\m\eX^\) %%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
Wenger, ahead of Sunday’s match at Fulham. “I will fight very hard to keep him here.” J_i\njYlip' mKfihlXp) %%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
Fabregas is injured for the final game of the season. Picture: ACTION IMAGES email sport@cityam.com
THE FULHAM SEASON TICKET 2011/2012
Prices start from £329 Adults and £95 Juniors.
Buy your season ticket before 23rd May for early bird discounts.
Visit fulhamfc.com/seasontickets or call 0843 208 1234
 26 Sport
EURO FINALS WEEKEND ++ EURO FINALS WEEKEND ++ EURO FINALS WEEKEND ++ EURO FINALS WEEKEND ++ EURO FINALS WEEKEND ++
Brian O’Driscoll Picture: ACTION IMAGES
O’Driscoll is
still a doubt
LEINSTER
NORTHAMPTON
▲
RUGBY UNION
BY JAMES GOLDMAN
IRELAND captain Brian O’Driscoll
remains a doubt for Leinster’s
Heineken Cup final against
Northampton tomorrow.
O’Driscoll sustained a knee injury
against Ulster last weekend and was
unable to take a full part in yester-
day’s training session.
Leinster coach Joe Schmidt said
that O’Driscoll had only been able to
run at “three-quarters pace” during
practice.
“We’re pretty confident that by
tomorrow he [O’Driscoll] will be able
to stretch out and be able to fully
accelerate,” added Schmidt.
Meanwhile, Jim Mallinder insists
Northampton’s exit from the Aviva
Premiership title race has invigorated
their pursuit of the Heineken Cup.
Saints’ quest for domestic honours
ended with last weekend’s play-off
semi-final defeat by Leicester at
Welford Road.
The Saints coach said: “We’re not
staggering over the finishing line,
instead we’re refreshed and looking
forward to the weekend. We’ve now
only got one thing on our mind.”
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Care: Cup can
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HARLEQUINS
STADE FRANCAIS
▲
RUGBY UNION
BY JAMES GOLDMAN
HARLEQUINS scrum-half Danny Care
believes his side’s presence in
tonight’s Amlin Challenge Cup final
completes the club’s rehabilitation fol-
lowing the dark days of the Bloodgate
scandal.
The London club were plunged into
turmoil following the events of the
2009 Heineken Cup quarter-final
against Leinster in which the use of
fake blood capsules to deceive officials
resulted in the resignation of director
of rugby Dean Richards and a
£260,000 fine.
Two years on and a fresh, vibrant
young side has emerged under the
guidance of Conor O’Shea and Care
believes tonight’s showpiece occasion
will act as a reward for those fans who
stuck by the club while the fallout
from the Bloodgate affair threatened
to tear it apart.
“Quins is such a historic club and it
is a club that should be winning tro-
phies again,” Care told City A.M. “We’d
love to do it for ourselves, for the
coaches and the fans who have stuck
with us through all the turmoil of the
last couple of years.
“It is a massive deal for the club to
be playing in such a high-profile event
after what has gone on. It’s been a
tough period but one that has brought
us closer together as a team.
“We had to roll our socks up, stop
CITYA.M. 20 MAY 2011
feeling sorry for ourselves. With all the
criticism the club was taking it was
hard. Being part of such a big occasion
is a reward for all the hard work.”
The road to Cardiff, let alone the
road to redemption, has been an ardu-
ous one and incorporated a defining
semi-final win against Munster, who
suffered only their second European
home defeat in 16 years.
Care was among the try-scorers in
the 20-12 win at Thomond Park and
the confidence garnered from that vic-
tory means a powerful Stade side,
which boasts two of his England col-
leagues James Haskell and Tom
Palmer, hold no fears.
Care said: “Going into the game we
were written off by everyone really.
But we knew if we went down there
and played as well as we could do we
could beat anyone.
“That self belief was there before
the game and then after the first 20
minutes when everything went so
well we kind of looked at each other
and thought: ‘We’ve got this’.
“It was just great to be involved and
to get a win there won’t be something
we forget for a long time. Hopefully we
can perform to that level again and
end the season on a high.”
With the World Cup on the hori-
zon, Care accepts it’s important he is
competing at the top of European
competition as he attempts to wrestle
England’s No9 shirt from Ben Youngs.
“It’s quite scary being considered
one of the older guys at Quins now,”
said the 24-year-old. “Hopefully that
extra experience I have can help in Care scored in the
terms of England. I feel that spot is semi-final win
still up for grabs and I want to be start- over Munster
ing for my country at the World Cup.”
Alfa Romeo are the official vehicle supplier Picture: GETTY
to Harlequins. Go to www.alfaromeo.co.uk
 CITYA.M. 20 MAY 2011 Sport 27

++ EURO FINALS WEEKEND ++ EURO FINALS WEEKEND ++ EURO FINALS WEEKEND

I wrote Quins off in the semi-final RFU left red-faced

but won’t make that mistake again by Woodward snub
disappointing season in the league. so if they don’t win this competition
It’s going to be a fantastic tussle. they’ll feel a huge sense of injustice. came after former England captain

Some of the match-ups around 8, 9
and 10 are of international quality.
It’s a great stage, the Millennium
Stadium, and a great opportunity for
those players.
You get the sense the force is with
RUGBY UNION COMMENT Quins. For all their glamour and
LAWRENCE DALLAGLIO glitz, Stade Francais this season have
not quite had the substance behind
it. With French teams particularly,
They’ve got some outstanding per-
formers. Sean O’Brien has been the
best back-rower in Europe by far this
season – his Amlin Opta stats are
unbelievable – while O’Driscoll,
although he’s not getting any
younger, still has the ability to influ-
ence a game when they need it most.
Northampton are a quality side
making progress every season and
▲
RUGBY UNION
BY FRANK DALLERES
WORLD CUP winning former
England boss Sir Clive Woodward has
left the Rugby Football Union’s plans
to appoint a performance director in
disarray after withdrawing his candi-
dacy for the job.
Woodward, who was the clear
favourite for a role that has provoked
Lawrence Dallaglio told City A.M. that
his former coach’s continued interest
in the role, despite indecision from
the RFU, was “positive news for
English rugby”.
The episode will be seen as embar-
rassing to the RFU, after the govern-
ing body changed its own job
description twice in a matter of days
last week. Having initially

F
EW, including myself, thought you feel that when they travel they were unlucky in the Premiership intense debate in recent weeks, announced the role would involve
Harlequins would have enough don’t always go with the best body semi-final. They keep putting them- released a statement yesterday ruling supervising the senior England set-
to get past Munster in the semi- language. They’re very talented and selves in a position to win, but himself out of the running and com- up, the governing body significantly
finals, especially at Thomond managed to beat the French champi- they’re a team who at the moment mitting himself to his current role diluted its responsibility in a move
Park. Munster’s biggest mistake was ons on their own patch to qualify for are developing and learning. That with the British Olympic that would have deterred some-
probably underestimating them and the final but I just fancy Quins’ said, they’ve got some real class play- Association. one of Woodward’s calibre. But
Quins ran out worthy winners. chances – and having written them ers and a formidable front row, so it “In order to prevent any further following internal ructions the
Now they’ve given themselves an off once against Munster, I’m not promises to be a cracking game. speculation and in the interests of job’s original remit was rein-
opportunity to win a major trophy. about to do it again. Leinster will have to produce their both the BOA and RFU I would like stated, reopening the door for
There are only three on offer each It promises to be a fantastic battle, best yet to beat Saints, who will be to formally confirm that I will not Woodward – until yesterday.
season so to end up with one is big. I as does the Heineken Cup final less better for that semi-final experi- be attending any interviews for Woodward confirmed he
also think they’ll want to make up than 24 hours later. ence – there’s nothing like being bat- this position,” he said. had informally dis-
for the surprise defeat to Newcastle Leinster have been very impressive tle-hardened for a big European “I am totally committed cussed a return to
in the EDF Cup, and they’ve given in this European campaign. They’ve game. If I had to pick, while I’d like to my role as director of rugby union with the
themselves a crack. beaten the French champions, to see an English winner, the experi- sport at the BOA and RFU, but emphasised
They’re playing against Stade English champions and European ence is with Leinster and in these deputy chef de mission he had kept the BOA
Francais who themselves have had a champions on their way to the final, games that can make the difference. for Team GB in informed.
London 2012. May I It is a welcome
wish the RFU all the boost for the BOA,
best in its search to who were embroiled
AMLIN OPTA INDEX HEAD-TO-HEAD: FINALS SPECIAL find the appropriate earlier this year in a
candidate for this very bitter and lengthy row
CHRIS ROBSHAW V JAMES HASKELL important role for English over Olympic cash with
The Amlin Challenge Cup final brings together two back-rows hoping rugby going forward.” Locog, the organisers of
for a place in England’s World Cup squad, Chris Robshaw and James Woodward’s withdrawal the London 2012 Games.
Haskell (right). Both have proved formidable tacklers, with Quins cap-
tain Robshaw having made 59 in Europe this season and Haskell an

MORE SPORT
impressive 64, including 22 in the semi-final against Clermont
Auvergne. Robshaw’s defensive displays have made him Quins’ top
performing forward in the Amlin Opta Index, while his discipline has

FA OPT OUT OF
seen him concede just two penalties in six appearances.

SEAN O’BRIEN V PHIL DOWSON

Fireworks are expected when Leinster and Northampton’s forwards

FIFA VOTE Page 25

collide, and none more so than Sean O’Brien and Phil Dowson. Saints
man Dowson (left) has accumulated the fourth highest score in the
whole Index, thanks to his 64 tackles and 84 carries. However, O’Brien
is the leading performer, forward or back, on any team, with 115 car-
ries in which he has beaten 19 defenders, more than anyone else.

The Amlin Opta Index is an ERC-licensed analysis of player performance in the Amlin Challenge Cup and Heineken Cup. To view the full results ahead of this week’s
action, head to the news section on ercrugby.com and for more information on the Amlin Opta Index, please go to the statistics section, also on ercrugby.com
TREVOR STEVEN ON RELEGATION FIGHT
Football comment: Page 25