Twitter Shares Priced At $26 In IPO

Twitter has set a price of $26 for its public stock offering and can begin trading on the New York Stock Exchange on Thursday.

The price values the San Francisco-based micro blogging site at $14.1bn, based on its outstanding stock and options, Reuters reported.

It is offering 70 million shares in the Initial Public Offering (IPO), with an option to buy another 10.5 million.

Twitter had originally set a price range of $17 to $20, but raised the range on Monday signalling an enthusiastic response from prospective investors.

A statement from the company read: "We've priced our initial public offering of 70,000,000 shares of our common stock at a price to the public of $26 per share.

"In addition we've guaranteed the underwriters a 30-day option to purchase up to 10,500,000 additional shares of common stock.

"Our shares are expected to begin trading on the NYSE on November 7 under the symbol TWTR."

Analysts said they expected shares in the company to experience a small rise during the first day of trading.

Investor enthusiasm for Twitter, which boasts 230 million users, is strong even though the micro blogging site has never turned a profit.

12.06 | 0 komentar | Read More

Universal Credit Scheme 'Has Lost Over £140m'

Universal Credit has been savaged by MPs for "shocking" failures that have already wasted at least £140m.

The scheme has been blighted by "alarmingly weak" management, with secretaries allowed to authorise purchase orders worth more than £20m.

In some cases it is unclear what suppliers have been paid for.

The cross-party Public Accounts Committee (PAC) also voiced doubts about whether the project can still be fully delivered by 2017 - branding a pilot "inadequate" and open to fraud.

Universal Credit is due to replace a bundle of means-tested benefits in four years' time, with Work and Pensions Secretary Iain Duncan Smith insisting it can ensure people are always better off in jobs and save £38bn by 2023.

Iain Duncan Smith says Universal Credit can save £38bn by 2023

However, a former Olympics executive had to be drafted in earlier this year to "reset" the programme amid concerns over delays and IT issues.

The PAC report said the Department for Work and Pensions had "neglected to implement basic procedures for monitoring and authorising expenditure".

The MPs said: "We saw evidence that purchase orders with a total value of £8.7m were approved by a personal assistant to the Programme Director.

"In another case, two purchase orders, one for £22.6m and one for £1.1m, were approved by a personal assistant to the Programme Director whose delegated financial authority at the time of approvals was only £10m.

"When the Department made individual payments to suppliers these could not be linked to particular pieces of work that had been delivered."

PAC chair Margaret Hodge said the implementation of Universal Credit so far had been "extraordinarily poor".

She said: "The failure to develop a comprehensive plan has led to extensive delay and the waste of a yet to be determined amount of public money.

"£425m has been spent so far on the programme. It is likely that much of this, including at least £140m worth of IT assets, will now have to be written off.

"The management of the programme has been alarmingly weak. From the outset, the Department has failed to grasp the nature and enormity of the task; failed to monitor and challenge progress regularly; and, when problems arose, failed to intervene promptly."

The MPs said the project would not hit its current target of enrolling 184,000 claimants by April 2014.

As a result the later stages would have to be speeded up to meet the 2017 completion date - but that would "pose new risks".

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Job Losses Feared At BAE Shipyards Amid Review

Defence giant BAE Systems will announce job losses when it releases a report on the future of shipyards on Thursday, Sky sources understand.

It is thought that two facilities in Scotland and one at Portsmouth could be affected.

Unions are to meet company representatives to discuss the future of the three sites amid a review of its business.

The firm has refused to comment on speculation that hundreds of jobs could be axed at Govan, Scotstoun and Portsmouth.

BAE said last year that it was considering closing one of its major shipyards as part of a maritime defence review, which is launched 18 months ago.

Scotland's Finance Secretary John Swinney said: "We have been in dialogue for some time with BAE Systems on the issues surrounding the future of the Clyde shipyards.

"We are awaiting the outcome of BAE's discussions with the Ministry of Defence and are very alert to the situation concerning both yards.

"We are seeking urgent clarity on the future for both Govan and Scotstoun."

A BAE spokeswoman said: "We continue to work closely with the Ministry of Defence to explore all possible options to determine how best to sustain the capability to deliver complex warships in the UK in the future.

"This work is ongoing and we are committed to keeping our employees and trade unions informed as it progresses."

Hugh Scullion, Confederation of Shipbuilding and Engineering Unions general secretary said: "We have secured talks with senior BAE systems executives early next week to examine the business case of the forthcoming announcement.

"Now is not the time for idle speculation or indeed party political point scoring.

"This is the future of an industry and we need to know from the company and the government directly what their plans for the future of UK shipbuilding are.

"The shipbuilding workforce throughout the UK are working flat out to deliver the aircraft carriers for the defence of the UK and they need to know what lies in store for them, their families and their communities."

A GMB union spokesman added: "Full time union officials and shop stewards will meet BAE next week to go over the detailed business case on how work will be organised once the carrier programme winds down."

12.07 | 0 komentar | Read More

VIP Visas Aimed At Drawing Executives To UK

By Anuskha Asthana, Political Correspondent

British visas are to be offered under a "same-day service" in China and a number of other countries in a bid to make the UK immigration service more pro-growth.

The move will be announced by Theresa May, the Home Secretary, who will also unveil plans to offer bespoke visa support to around 100 global business leaders.

They will be invited to join the new "Great" club with access to an account manager whose aim is to make their dealings with the visa and immigration system "swift and smooth".

Britain's priority visa service - between three and five days - will be expanded from 67 to over 90 countries by next spring.

And the one-day offering only available in India will be extended to China and a number of other locations.

Theresa May will offer same day visas to China

There will also be a special mobile visa service starting with a pilot in south India.

Mrs May said she wanted "excellent customer service" to help Britain maintain a "world class, competitive visa system".

She admitted that was necessary for the UK to serve the "ever-changing needs" of business and succeed in the global economic race.

She added: "We will continue to listen and respond to the needs of high-value and high-priority businesses so that we can provide them with a service that supports economic growth, while at the same time maintains the security of our borders."

The move is in response to fears within Government and outside it that Britain's crackdown on immigration is deterring highly skilled individuals from visiting the country.

Businesses and the City say they need to be able to bring in the best talent to help boost economic growth.

The new scheme will operate as a 12-month pilot, starting in the new year.

The issue has caused tensions inside the Coalition, with the Lib Dem business minister Vince Cable being particularly vocal.

He has also spoken out about universities.

They fear that the attempt to reduce net immigration to the tens of thousands - and the rhetoric it carries - is weakening their chances of attracting the best students.

That limits their ability to compete with institutions in other countries such as the US, Germany and Australia.

12.07 | 0 komentar | Read More

Water Bills: Minister Urges Firms To Rethink

The Environment Secretary has urged water companies to "look closely" at whether price increases are necessary and urged them to introduce special tariffs for hard-pressed households.

In a letter to suppliers, Owen Paterson MP said they should recognise the financial strain that people were under.

The intervention came with Ofwat expected later this week to reject an application from Thames Water to increase bills by £29 in 2014-2015.

The regulator has questioned the profits being made by firms, and suggested its next Price Review could ease the upward pressure on bills by up to £750m after 2015.

Owen Paterson has urged water companies to reconsider price hikes

Mr Paterson said: "We know that household budgets are under pressure, and keeping water bills affordable is a crucial way we can help hardworking people.

"That is why we are pressing hard to make sure customers get a fair deal, by encouraging water companies to look closely at any price increases, introduce social tariffs for vulnerable customers and crack down on bad debt."

Water bills have risen by more than 60% in the last decade and the average household bill is now £388.

Since 2009, average increases in water and sewerage bills have been in line with inflation, but this has still outstripped increases in household income.

Water companies have blamed the price increases on the costs of environmental improvements including replacing ageing Victoria water pipes.

It comes after the cost of living has become increasingly important on the political agenda after Labour leader Ed Miliband pledged to freeze energy prices if his party wins the 2015 General Election.

Mr Miliband will accuse the coalition Government of "shrugging their shoulders" about low wages and rising prices this week and will challenge Conservative and Lib Dem MPs to back his policy of freezing energy bills in a Commons vote on Wednesday.

During a speech at Battersea Power Station, he will say: "The cost of living crisis isn't just an issue for the lowest paid, it affects the squeezed middle just as much.

"This is not just an issue facing Britain. It is the issue facing Britain. It is about who our country is run for."

Prime Minister David Cameron last week said he wanted to "roll back" environmental taxes that bump up energy bills, and promised more details in Chancellor George Osborne's Autumn Statement on December 4.

:: Read the full letter here

12.06 | 0 komentar | Read More

Duchy Of Cornwall 'Not Advantaged' By Tax Break

By Paul Harrison, Royal Correspondent

The Duchy of Cornwall does not possess a "competitive advantage" over other businesses despite being exempt from hefty taxes, a spokesperson for Prince Charles' estate has told Sky News.

The comments come as the Public Accounts Committee (PAC) today publishes its report on the accounts of the 700-year-old Duchy of Cornwall estate.

Under the Duchy, established in 1337 by King Edward III, the heir to the throne is exempt from paying corporation and capital gains taxes on land and property transactions.

The Duchy of Cornwall estate was established by King Edward III in 1337

But while the current Duke of Cornwall, Prince Charles, is technically exempt from paying income tax, he has volunteered to do so since 1993.

The Duchy spokesperson told Sky News: "We do not believe we have a competitive advantage.

"The Duke of Cornwall's income is taxed at income tax rates. The Duchy is not subject to corporation tax and the Duchy is not a corporation... any capital gains have to be reinvested in the business and cannot be distributed."

But the PAC's Margaret Hodge MP wonders whether the Duchy's unique tax arrangements allow for a level playing field when the estate stands alongside other businesses.

She said: "If you're letting property to a Holiday Inn in Reading or to Waitrose to run a big depot on an industrial estate, are the terms of that enabling other competitors in that market to compete on an equal and level playing field?

The estate owns property including the Kia Oval in south London

"What started off 700 years ago as a medieval estate, today demonstrates all the features of a modern big corporation, yet it hangs on to old habits such as exemption from corporation tax."

The Duchy's main activity is the management of land and properties which make up its estate, providing an income for the present and future Dukes of Cornwall.

Its portfolio is made up of 131,000 acres of land, properties spread across 24 counties and more than 3,500 individual lettings.

All together over the last financial year it generated £28.8m and the Prince received an income of £19m, up 4% on the previous year.

The money is partly used to fund his and his family's public, charitable and official duties and the Prince voluntarily pays income tax on the cash left after costs, around £9.2m last year, according to the PAC.

Margaret Hodge believes the Treasury falls short of proper scrutiny when it comes to the Duchy's finances.

She said: "It [The Treasury] relies on the Duchy to provide it with accurate information without carrying out its own independent checks.

"Details of the Treasury's approvals for the Duchy's proposed land transactions over £500,000, of which there are around 15 a year, are not published.

"Greater transparency is needed."

In answer to the PAC findings, the Treasury said: "HM Treasury's role is to ensure that the Duchy of Cornwall is managed in a sustainable way and that the strategic choices made by the estate's managers are in its long-term interests and those of current and future dukes.

"The Treasury has a constructive working relationship with the Duchy, and challenges decisions where appropriate."

12.06 | 0 komentar | Read More

Founders Eye £250m Jackpot From Tilda Sale

By Mark Kleinman, City Editor

A family which fled Uganda after being expelled by the dictator Idi Amin is eyeing a £250m jackpot from the potential sale of Tilda Rice, one of the UK's most prominent food brands.

Sky News understands that members of the Thakrar family which controls Tilda are considering a sale of part of all of the company more than four decades after they arrived in Britain.

Tilda, which is stocked by all of the major supermarket chains and has a huge share of the retail trade in packaged rice, has appointed investment bankers at Rothschild to oversee a review of options for the family's shareholding, sources close to the situation said.

An outright sale is thought to be on the agenda, with analysts estimating that the company could be worth in the region of £250m.

A sale at that price would cap a remarkable success story for the Thakrars, who arrived in north London in the early 1970s cleaning and packing rice and pulses after their expulsion from Uganda by Idi Amin's regime.

They focused the company initially on targeting sales within the UK's fast-growing community of immigrants from India and Bangladesh but quickly realised the much broader potential demand.

Now employing 200 people in the UK, Tilda has grown so ambitiously that six years ago it began exporting its rice products to India, one of the world's most voracious consumers of the food.

The Thakrars identified an opportunity to build their business in India amid changing consumption and buying habits in the world's second most populous nation.

Tilda is expected to make earnings before interest, tax, depreciation and amortisation of roughly £25m this year, with food companies often trading at multiples of about ten times their annual profits.

"The group's main objective is for growth in sales and profitability," the company's parent, Braunstone Properties, said in its most recent accounts filed at Companies House.

It added: "This will be achieved by building on the success of the existing brands in the EU and overseas markets, and by continuous improvements in operational efficiency."

A Tilda spokesman declined to comment on the appointment of Rothschild or on the shareholders' plans.

12.06 | 0 komentar | Read More

Small Investors Land 12-Year Co-op Deal

By Mark Kleinmann, City Editor

Thousands of small investors in the Co-operative Bank will be guaranteed income for 12 years under a deal to patch up its finances that will be unveiled on Monday.

Sky News has learnt that the Co-operative Group agreed this weekend to structure a rescue deal for the bank by effectively gifting roughly 10,000 retail bondholders a new fixed-income instrument that will provide a contractual cashflow guarantee.

The deal will offer greater protection for small investors, who are the Co-op Bank's lowest-ranking creditors, than was envisaged under proposals originally crafted by the mutual and which were vehemently opposed by bondholders.

Euan Sutherland, the Co-op Group chief executive, wanted to keep control of the banking arm by handing bonds to institutional investors and shares to small investors. The latter group objected to this because the shares are unlikely to pay a dividend, and many small investors depend on income from the bonds.

Despite the improved terms, private investors will still face significant losses on their capital as the Co-op Group seeks to fill a £1.5bn black hole in the balance sheet of its struggling banking arm.

Canaccord Genuity Hawkpoint, a City advisory firm, is said to have decided to advise retail bondholders that the deal they are being offered is a fair one.

The restructuring, which is expected to be announced to the stock market at 7am, is unlikely to be accompanied by details of more than 1000 job cuts at the bank revealed by Sky News on Saturday.

The Co-op Bank is drawing up a new business plan that will see it focus on retail and small business lending, with many back office staff and those in its corporate lending arm facing the axe.

A planned hardship fund, which was to have been set up to help small investors, is now understood to have been abandoned because of the decision to guarantee income for 12 years under the revised deal.

"The hardship fund would have had no real value," said a source close to the situation.

Institutional investors led by two US hedge funds, Aurelius and Silver Point, will own the bulk of the Co-op Bank's shares when they list on the stock market next year.

The Co-op Group will be the largest single shareholder with a 30% stake, and plans to rewrite the Bank's constitution to enshrine the mutual's ethical principles under its new ownership structure.

The Prudential Regulation Authority is expected to issue a statement on Monday endorsing the deal.

A Co-op spokesman declined to comment.

12.06 | 0 komentar | Read More

Co-Op: US Hedge Funds Reassure Watchdog

By Mark Kleinman, City Editor

A group of American hedge funds is trying to reassure the Bank of England about their role in the restructuring of the Co-operative's troubled banking arm ahead of a formal deal to be announced on Monday.

Sky News has learnt that the LT2 Group, a coalition of funds which has forced Britain's most important mutual to cede majority ownership of its troubled lender, has held talks with regulators to reassure them that they do not intend to cross a crucial bank ownership threshold.

Under Prudential Regulation Authority (PRA) rules, any party owning more than 10% of the shares in a regulated bank must receive approval from the banking watchdog.

The stipulation is designed to prevent undue influence being exercised over important financial institutions by unregulated entities.

The rule also applies to a group of investors acting in concert, which hedge funds including Aurelius and Silver Point have been doing as they sought to win a better restructuring deal for bondholders from the Co-op Group.

Last week, it emerged that the bondholders would gain control of 70% of the Co-op Bank's shares as part of a debt-for-equity swap, leaving the Co-op Group still as the largest individual shareholder, although holding just a 30% stake.

Advisers to Aurelius, Silver Point and other bondholders have informed the PRA that none of them plans to individually hold a stake of 10% in the Co-op Bank, and that they should not be deemed to be acting collectively despite their months-long campaign to restructure the bank.

People close to the situation said on Friday the PRA was expected to be sympathetic to the hedge funds' argument, but that the issue was the subject of strict legal tests and would be closely monitored.

The funds are anxious to avoid having to be approved by the PRA because of the length of time the process can take.

The restructuring of the Co-op Bank will involve listing its shares on the London Stock Exchange next year, as it seeks to raise £1.5bn to fill a capital hole in its balance sheet.

Next Monday's financial restructuring is expected to be accompanied by the publication of a revised business plan for the Co-op Bank, which will entail significant cost cuts and job losses.

The news that the Co-op Bank would no longer be majority-owned by a mutual has sparked fury among many customers, prompting the bondholder group to acknowledge the lender's ethos.

"The Co-Operative Bank is unique for its ethics, mission and heritage which are an essential component of the Bank's differentiated approach," LT2 said in a statement last week.

"It is important to us that the Bank will maintain its unique characteristics and ethos.

"The Co-operative Group Ltd. will remain the Bank's largest shareholder by far and the Bank will benefit by this connection to the Co-operative movement."

Spokesmen for LT2 and the Co-op declined to comment.

12.06 | 0 komentar | Read More

Co-op To Axe More Than 1,000 Banking Jobs

By Mark Kleinman, City Editor

The Co-operative Group is to axe more than 1,000 jobs at its troubled banking arm as part of a complete overhaul of its business and finances.

Sky News understands that the job cuts, which could be detailed as soon as Monday, will account for well over 10% of the Co-operative Bank's workforce.

The redundancies will underline the human toll of the lender's mismanagement in recent years as it finalises a plan to fill a £1.5bn hole in its balance sheet.

As expected, the deal, which will have the approval of the Bank of England, will involve Britain's biggest mutually-owned organisation relinquishing ownership of the Co-op Bank.

Insiders said a decision had yet to be taken about whether the scale of the jobs cull would be made public on Monday by Euan Sutherland, the Co-op Group chief executive.

"It's unlikely he'll want to go public with it at this stage," said one.

The final number was still being decided this weekend but sources said that well over 1,000 of the roughly 9,000 people who work for the mutual's banking arm were expected to lose their jobs.

The axe will fall principally on those working in the Co-op Bank's corporate lending business, with a revised strategy focused on retail and small business customers.

Senior managers, led by Niall Booker, the Bank's chief executive, had also been examining a relaunch of Smile, its internet brand, one insider said.

Retail bondholders are likely to receive a better deal than one presented as a fait accompli by Mr Sutherland until last week.

People close to the deal said that ordinary investors would probably be handed a combination of bonds and a new instrument guaranteeing income.

The biggest institutional bondholders - two US hedge funds - fought to overturn the original deal and will emerge as big shareholders when the bank's shares are listed on the stock exchange next year.

The news that the Co-op Bank will no longer be majority-owned by the mutual has sparked fury among many customers, prompting the bondholder group to praise the lender's ethos.

"The Co-Operative Bank is unique for its ethics, mission and heritage which are an essential component of the Bank's differentiated approach," LT2 said in a statement last week.

"It is important to us that the Bank will maintain its unique characteristics and ethos.

"The Co-operative Group Ltd. will remain the Bank's largest shareholder by far and the Bank will benefit by this connection to the Co-operative movement."

12.06 | 0 komentar | Read More