|Royal Dutch Shell plc spends millions of dollars on security in Nigeria|
|Monday, 20 August 2012 08:54|
News round up: Shell, Glencore, Xstrata, Euro, Greece, Job creation fund, Standard Chartered, Second-quarter earnings season.
Glencore - Xstrata
The Qatari state investment fund has pushed the world’s largest merger, between Glencore and Xstrata, to the brink of collapse this weekend after building up a stake nearly large enough to block the deal. Qatar Holding, the financial vehicle of the gas-rich emirate, spent more than 5bn dollars on Xstrata shares to make it the second-largest investor — Glencore owns 34 per cent — before demanding improved terms. It has vowed to vote against the deal unless Glencore offers at least 3.25 shares for each Xstrata share, rather than the agreed 2.8 ratio.
Lord Rothschild has taken a near-£130m bet against the euro as fears continue to grow that the single currency will break up. The fact that the former investment banker, a senior member of the Rothschild family, has taken such a view will be seen as a further negative for the currency. RIT Capital Partners, the investment trust which Lord Rothschild has led since 1988, had a -7% net short position in terms of principal currency exposures on the euro at the end of July, up from -3% at the end of January.
Greece must remain in the euro to survive according to its finance minister, Yannis Stournaras, as the country’s leader prepares for a week of crucial meetings with Eurozone authorities which could ultimately determine its fate. Stournaras said the country must press ahead with the spending cuts demanded by its fellow Eurozone members because its membership of the single currency was essential.
Job creation fund
A government job creation fund will badly miss its target to get money to businesses in employment blackspots. Nearly two thirds of the cash promised — some of it offered 16 months ago — is still sitting in the Treasury. The £2.4bn Regional Growth Fund, which has been fronted by Nick Clegg, the Deputy Prime Minister, was due to have fully allocated £1.4bn of funding to 176 bid-winning companies and organisations by the end of next month.
Standard Chartered is thought to be just months away from recruiting at least two new independent directors as it shores up its boardroom in the wake of damaging sanctions-busting allegations involving Iran. The bank’s 11-strong group of non-executive directors features seven long-standing board members. Rudy Markham, the senior independent director, has been on the board since 2001, while Ruth Markland and Paul Skinner both joined in 2003. Under the Combined Code rules governing best boardroom practice, a director who has been in place for more than nine years is no longer deemed to be independent.
Second-quarter earnings season
A disappointing second-quarter earnings season in Europe has prompted analysts to scale back markedly their expectations for earnings growth for the rest of the year. More companies missed than beat expectations in the second quarter of this year, with 48% of those listed on the Stoxx 600 reporting lower than expected consensus quarterly earnings, according to data from Thomson Reuters.
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