15th Jun 2015 10:04
LONDON (Alliance News) - The following is a summary of top news stories Monday.
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COMPANIES
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Rolls-Royce Holdings said it has won services contracts valued at up to USD224 million to support US military branches and global air forces supplied by the US Department of Defense. The contracts will support Rolls-Royce AE 2100, Adour (F405) and T56 engines across a variety of fleets, the company said. Services to be supplied by Rolls-Royce include logistics support, engineering, parts, repairs, field services and design modifications.
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Aberdeen Asset Management revealed plans to launch new investment funds after raising additional tier 1 capital by agreeing to issue GBP100 million of non-voting preference shares to top shareholder Mitsubishi UFJ Trust and Banking Corp. In a statement, Aberdeen Asset Management said it is issuing the perpetual redeemable preference shares to Mitsubishi UFJ Trust and Banking Corp, which owns about 17% of the asset manager, with a view to providing seed capital for the new funds.
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Thomas Cook Group said it will establish a joint venture with Fosun International to develop domestic, inbound and outbound tourism activities for the Chinese market under Thomas Cook brands, a move that comes after the two companies in March formed a strategic partnership to look for opportunities in the Chinese market. The joint venture will be 51% owned by Fosun and 49% by Thomas Cook. The two companies will put a total of GBP1.6 million into the venture to support its start-up, roughly half each. Fosun International, chaired by Chinese billionaire Guo Guangchang, in March bought a 5% stake in the UK travel operator and said it plans to increase its stake to 10% by buying shares in the open market over time.
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Vedanta Resources said it is merging two Indian subsidiaries as it looks to simplify its structure. The move results in the combination of Vedanta Ltd and Cairn India. Minority shareholders in Cairn India will receive one equity share in Vedanta Ltd, as well as one redeemable preference share in Vedanta Ltd with a face value of INR10, implying a premium of 7.3% to the previous closing price. Chief Executive Tom Albanese said the combination of Vedanta Ltd and Cairn India will help to "unlock" India's energy and mineral resources. Following completion of the transaction, Vedanta Resource's ownership in Vedanta Ltd is expected to decrease to 50.1% from its current 62.9% shareholding. Cairn India minority shareholders will own 20.2% and Vedanta Ltd minority shareholders will own a 29.7% stake in the enlarged entity. Prior to the transaction, London-listed Cairn Energy holds a 9.8% stake in Cairn India.
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NMC Health said it has agreed to acquire United Arab Emirates-based long-term medical care provider ProVita International Medical Center LLC for USD160.6 million in cash. The acquisition adds 120 beds to NMC's expected 2015 licensed bed capacity of 720, NMC said.
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Unite Group said the Unite UK Student Accommodation Fund, in which it has a 22% stake, has exchanged contracts to acquire a 2,100 bed student accommodation portfolio for GBP271 million. The student accommodation developer and manager said the fund will pay for the deal using the proceeds of last month's equity raise.
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Emirates National Oil Co said it has reached a recommended deal to buy Dragon Oil for 750 pence a share in cash, valuing the whole of Dragon at GBP3.7 billion, an improvement on its initial approach. Emirates, which is owned by the government of Dubai, is already Dragon Oil's majority shareholder, and the offer for the stake it doesn't own is worth about GBP1.7 billion in total. It said its offer is 47.2% above Dragon Oil's share price on March 13, the day before it first approached Dragon Oil. The company first approached Dragon about a possible acquisition of the stake it didn't already own in March, and last month it put forward a 735 pence a share potential offer.
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MARKETS
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London shares prices are lower as European stock markets start a week that is expected to be decisive for the Greek debt negotiations, with the European Commission saying there are "significant gaps" between the two sides.
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FTSE 100: down 0.7% at 6,736.63
FTSE 250: down 0.9% at 17,784.24
AIM ALL-SHARE: down 0.4 at 771.60
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GBP: down at USD1.5501
EUR: down at USD1.1228
GOLD: down at USD1177.71 per ounce
OIL (Brent): down at USD64.02 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Greece's prime minister urged the country's creditors to get "realistic" a day after weekend negotiations failed to bridge major differences, setting the stage for eurozone finance ministers to make a final push to reach a deal to avert a default. Prime Minister Alexis Tsipras accused the institutions involved in the country's bailout negotiations of "political expediency" regarding their insistence on pension cuts. He said: "We do not have the right to bury European democracy at the place where it was born."
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The average asking price for a house in the UK jumped 3.0% on month in June, property tracking website Rightmove said - coming in at GBP294,351. Analysts figure the jump was the result of last month's election results, which resulted in a Conservative victory - as well as a dwindling pool of available houses. Prices had slipped 0.1% in May. On a yearly basis, prices spiked 4.5% after gaining 2.5% in the previous month.
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Standard & Poor's Ratings Services late Friday downgraded its outlook for UK sovereign debt to negative from stable due to the government's decision to hold a referendum on membership in the European Union by 2017. "We believe that the UK government's decision to hold a referendum on EU membership by 2017 indicates that economic policymaking could be at risk of being more exposed to party politics than we had previously anticipated, similar to the situation in the US when we lowered that sovereign rating in 2011," S&P said. "A possible UK departure from the EU also raises questions about the financing of the economy's large twin deficits and high short-term external debt," the ratings agency added. At the same time as downgrading its outlook on the UK, S&P affirmed its AAA/A-1+ long- and short-term sovereign credit ratings.
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EU rules forcing Italy to look after all the boat migrants who land on its territory and stop them moving elsewhere in the bloc must be changed, Italian Prime Minister Matteo Renzi said in an interview. The so-called Dublin II regulation is criticized for putting undue pressure on countries that serve as entry points for EU-bound migrants, such as Italy and Greece. Its prescriptions are often ignored, as many refugees still find their way to northern Europe. "In Europe we must change the principle set by Dublin II," Renzi told the Corriere della Sera newspaper, adding that he had an unspecified "plan B ready" if an upcoming EU summit does not deliver progress on such issues. Migration is expected to top the agenda at the June 25-26 meeting of EU leaders in Brussels. They are due to consider proposals to relocate 24,000 asylum seekers from Italy and 16,000 from Greece to elsewhere in the bloc, over the course of two years.
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Eurozone trade surplus increased in April as exports expanded from March amid fall in imports, data from Eurostat showed. The trade surplus rose to a seasonally adjusted EUR24.3 billion from EUR19.9 billion in March. Exports gained 1.1%, while imports decreased 1.6% from the prior month. On an unadjusted basis, the trade surplus totaled EUR24.9 billion in April compared to a EUR14.9 billion surplus seen in the same period of last year.
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The US presidential race is heating up. Former secretary of state Hillary Clinton pledged to fight for the middle class in her first major Democratic campaign rally before thousands of cheering supporters on New York City's Roosevelt Island. But on Monday, the centre-left politician will likely be overshadowed by the long-awaited formal announcement in Miami by Jeb Bush - son of one president, brother to another and former governor of the southern state of Florida.
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The number of people infected in South Korea's outbreak of Middle East Respiratory Syndrome has risen to 145, the Health Ministry said, after seven new cases were confirmed. So far 14 people have died of the dangerous respiratory illness, which erupted in the country in May. Most of the newly diagnosed patients contracted the virus at the Samsung Medical Center in Seoul. The hospital said that in order to focus on stopping the spread of MERS, non-emergency services were being suspended and no new patients would be accepted.
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The US launched an airstrike in Libya against al-Qaeda terrorist Mokhtar Belmokhtar, the Pentagon said. Belmokhtar has a long history of leading terrorist activities as a member of al-Qaeda in north-western Africa, and directed the 2013 attacks in Algeria that killed at least 38 people from 10 countries, including three Americans, it said in a statement. The "counterterrorism strike against an al-Qaeda-associated terrorist" was carried out Saturday, Colonel Steve Warren said earlier.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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