23rd Jun 2015 10:15
LONDON (Alliance News) - The following is a summary of top news stories Tuesday.
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COMPANIES
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Ladbrokes confirmed it is holding talks with unlisted rival Gala Coral Group on a possible merger of Ladbrokes and Coral Retail, Eurobet Retail, and Gala Coral's Online businesses. Ladbrokes said the talks are focusing on plans to create an enlarged business which would be traded on the main market of the London Stock Exchange, where the betting firm currently is traded as a member of the FTSE 250 index. Ladbrokes said there is no certainty a deal will be done between the two or on the timing of any agreement. Ladbrokes also said that, should the deal proceed, it may undertake an equity placing in order to strengthen the balance sheet of the combined business.
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The UK government said it has further sold down its stake in Lloyds Banking Group, bringing its stake in the bank below 17%. UK Financial Investments Ltd, which manages the government's stake in bailed-out banks, sold off approximately a further 1% of the bank, cutting its stake from 17.9% to 16.87%.
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International Consolidated Airlines Group said it has secured a bridge facility from Banco Santander to back its EUR1.4 billion takeover offer for Irish flag carrier Aer Lingus Group. The owner of British Airways and Iberia said Banco Santander has agreed to provide the EUR1.4 billion bridge facility to back the bid for Aer Lingus by IAG's AERL Holding subsidiary.
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Bunzl said trading in the first half of the year has been in line with its expectations as it announced the acquisition of four businesses in the US, Colombia, Canada and France. The distribution and outsourcing company said overall trading in the first half of 2015 has been in line with its expectations, with revenue in the first half set to grow by around 6%, including a one-percentage-point benefit from positive exchange rate movements. Organic revenue is set to grow by 1% in the quarter, with the remainder of the total growth driven by acquisitions, it said.
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Glencore is facing a lawsuit from a so-called 'fixer' in Nigeria over claims the FTSE 100-listed miner reneged on a payment of millions of dollars for an intervention made on behalf of Russian sailors who were arrested on suspicion of arms-dealing, The Times reported. Glencore is being sued by Og Amazu, a former Glencore agent in Nigeria, who the company asked to intervene after the Nigerian navy found "a large number of weapons" on board a ship contracted to Glencore's largest Russian client, according to a court filing seen by the paper.
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Multi-utility provider Telecom Plus reiterated its guidance for its current year, as it posted a rise in pretax profit for its recently ended financial year driven by the continued take up of its services. For the year to end-March the company posted a pretax profit of GBP42.0 million, up from GBP34.7 million a year before, on revenue of GBP729.2 million, up from GBP659.7 million. Telecom Plus proposed a final dividend of 21 pence, taking its total dividend for the year to 40 pence, increased from 35 pence a year before. The company continues to expect adjusted pretax profit of between GBP54 million and 58 million for its current financial year, and said "in the absence of unforeseen circumstances" it intends to increase the dividend by 15% to 46 pence per share.
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Petrofac said its engineering, construction, operations and maintenance division has had a good start to the year, and the company said its portfolio is performing in line with expectations despite challenges at the Laggan-Tormore project. Petrofac said construction activities at the Laggan-Tormore project north-west of the Shetland Islands are "substantially complete" and the company is focusing on pre-commissioning work to deliver first gas in the third quarter of 2015. Since the start of 2015, Petrofac's engineering, construction, operations and management division has secured an order intake of USD4.70 billion, including the USD900 million Yibal Khuff award in June. At the end of May, the company's backlog stood at "record levels" at USD20.50 billion, which compares to USD18.90 billion at the end of December.
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Saga said it is on track to meet its targets for the year and confirmed Andrew Goodsell will become its non-executive chairman from July 1. Saga, which is holding its annual general meeting Tuesday, said it is on track to meet its strategic objectives for the financial year to the end of January 2016, including the launch of its motor insurance panel by summer this year and securing regulatory approval for the acquisition of Bennett Bikes.
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MARKETS
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UK stocks are flat to higher mid-morning after investor sentiment was boosted Monday by a positive outcome from the Eurogroup meeting held in Brussels, though with still no deal on Greece's debt problems and with a new summit scheduled for Thursday.
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FTSE 100: up 0.2% at 6,839.32
FTSE 250: up 0.3% at 17,966.15
AIM ALL-SHARE: up 0.1% at 770.21
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GBP: down at USD1.5797
EUR: down at USD1.1230
GOLD: down at USD1183.88 per ounce
OIL (Brent): up at USD63.41 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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There are some "tough measures" included in the reform proposals Greece has presented to its international creditors, a government spokesman said, indicating that a deal was close, despite a backlash already looming within the country. Late-night negotiations in Brussels have put Greece closer to striking a deal with its creditors than it has been in months, as all sides work to avoid a default. However, the remaining issues - preferential tax treatment for some Greek islands, for example - still promise to be contentious. "I'm convinced that we will come to a final agreement in the course of this week, for the simple reason that we have to find an agreement this week," said European Commission President Jean-Claude Juncker, following the emergency summit in Brussels. A new reform proposal, submitted by Athens just hours before Monday's talks, has managed to "inject new dynamism into the negotiations," said EU President Donald Tusk.
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Russia will continue to ban numerous categories of food from Western countries for another six months because the EU has prolonged its sanctions against Russia, Prime Minister Dmitry Medvedev said. He ordered the government to prepare a decree in the name of President Vladimir Putin to inform the EU of the prolongation. The EU earlier in the day extended its economic sanctions against Russia by six months. The measure followed deadly fighting in eastern Ukraine over the weekend.
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Eurozone private sector economic growth hit a four-year high in June, flash data from Markit Economics showed. The composite output index came in at 54.1 in June, a 49-month high and above expectations of 53.5. The index was at 53.6 in May. The upturn in June also took the average PMI reading for the second quarter as a whole to the highest for four years.
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Germany's private sector growth improved in June as output growth accelerated further, survey results from Markit Economics showed. The flash composite output index rose to 54 in June from a five-month low of 52.6 in May.
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The Chinese manufacturing sector continued to contract in June, albeit at a slower pace, HSBC Bank said, with a preliminary PMI score of 49.6. That marked a three-month high for the index, and it also topped expectations for a score of 49.4 and was up from 49.2. It also remained barely beneath the line of 50 that separates expansion from contraction. "The latest Flash China Manufacturing PMI survey provided a mixed bag of data in June. On the one hand, the sector shows signs of improvement as output stabilized amid a slight pick-up in total new work, while purchasing activity also rose slightly over the month," Markit economist Annabel Fiddes said. "The data add to evidence that the sector has lost growth momentum in Q2 as a whole, and suggests that the authorities may step up their efforts to stimulate growth and job creation in the second half of the year."
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A US air strike in northern Iraq killed a leading member of the Islamic State militant group, the Department of Defense said. Ali Awni al-Harzi was killed in a June 15 strike in the Iraqi city of Mosul, according to an official statement.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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