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Stronger bonds 
boost European 
share markets 

A further recovery in bond markets ted share 
prices higher across Europe. Bonds consolidated 
in calmer trading but traders said long-term inves- 
tors remained and cash activity was 

thin . German bond markets firmed after the Bund- 
esbank called for variable-rate securities repurchase 
agreements, a move seen as paving the way For 
lower short-term interest rates. Later, encouraging 
comments bum a member of the US Federal 
Reserve gave US Treasuries a lift, further support- 
ing European bond markets. Bond markets. 

Page 24; London stocks. Page 31; World stocks. 
Page 42 

HoII inger buys Chicago Sun-Times: 

Uollinger, the international newspaper group 
controlled by Conrad Black, owner of Britain's 
Telegraph group, has purchased the ninth biggest 
US doily, the Chicago Sun-Times. Page 19 

HSBC sees big rise in pre-tax profit s 

A buoyant banking 
market in the Asia 
Pacific region and 
big earnings from foreign 
exchange and capital 

markets trading lifted 
pre-tax profits of HSBC 
Holdings by 51 per 
cent to £&58bn ($3.76bnj 
last year, compared 
with £1.74bn in 1992. 
HSBC, chaired by Sir 
William Purves (left) 
has become the second 
most valuable company on the London stock 
exchange since its acquisition of Midland Bank 
in 1992. Page 19; Greater than the sum of his 
parts. Page 17 

Deadline for EU enlargement talks: 

Strenuous efforts were being made in Brussels 
last night to salvage negotiations to get Finland, 
Sweden. Austria and Norway into the European 
Union by next year. Page 18 

Elf urged to build east German re finery 

The German government and privatisation authori- 
ties stepped up pressure on French energy group 
Elf Aquitaine to build a showpiece oil refinery 
in Leuna, eastern Germany. Page 18 

Bentsen may modify bank proposals: 

Plans to consolidate the multi-layered US bank 
regulation system will face a crucial test this 
morning when Treasury secretary Lloyd Bentsen 
presents the administration's proposals to the 
Senate banking committee. Page 5 

Japan reviews defence policy: The Japanese 
government opened the first review of defence 
policy for nearly 20 years, caught between pressure 
for defence cuts and fears of weaker US Involve- 
ment at a time when regional stability is at risk. 
Page 6; Housing boost. Page 6 

Russian biteWfienco chief sacked: President 
Boris Yeltsin sacked the head of his domestic 
intelligence sendee and presided over the first 
tit-For-tat expulsion of a US diplomat under his 
rule. Page 3 

Malaysia sees trebling of telecoms: The 

Malaysian government wants to more than treble 
the size of Its telephone network in the next six 
years, and is anxious for western companies to 
help. Page 4; Malaysia steps up US curbs. Page 6 

NBC, US network television broadcaster, is 
expressing serious interest in applying to run 
a new national Channel 5 in the UK. NBC could 
not by law control such a venture, but is starting 
to look for potential UK partners. Page 8 

PotyGram, one of the world's top three music 
companies whose acts include Sting, Van Morrison, 
and Stevie Wonder, reported a 21 per cent leap 
in net income in 1993 to FI 614m ($319m) from 
FI 506m in 1992. Page 20, Lex, Page 18 

UK economic figures Improve: A sharp 
rise in the purchasing managers' index and newly- 
published money supply figures point to the health 
or the UK recovery after recent sluggish economic 
statistics. Page 8 

Hijackers surrender: Three men who hijacked 
an Algerian airliner carrying 120 passengers to 
Alicante in southern Spain surrendered to Spanish 
police after five hours of negotiations. Ail passen- 
gers were believed to be unhurt 

Gainsborough: A self-portrait by 18th century 
artist Thomas Gainsborough has been accepted 
by the government In lieu of £l.lm in inheritance 
taxes from the estate of the late Dowager Marchio- 
ness of Cholmondeley. The canvas will be handed 
to the National Gallery. 

■ STOCK MABKET MPiCES | ■ STERLING 


Karadzic flies to Moscow after US fighters shoot down four jets in Bosnia Central 


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Russia backs Nato 
action against 
Serb warplanes 


By Layla Boulton in Moscow, 
George Graham (n Washington 
and Laura Sflber in Belgrade 

Mr Radovan Karadzic, the 
Bosnian Serb leader, flew unex- 
pectedly to Moscow last night 
after Russia supported the shoot- 
ing down by US Nato fighters 
early yesterday of four or his 
warplanes. 

Mr Andrei Kozyrev, the Rus- 
sian foreign minister - appar- 
ently seeking to puli off another 
diplomatic coup similar to the 
intervention that averted Nato 
air strikes on Bosnian Serb 
ground positions two weeks ago 
- said Moscow wanted to encour- 
age Serbs and all other warring 
parties in former Yugoslavia to 
“work for peace in a fratricidal 
conflict". 

Mr Kozyrev said: “The most 
important thing now is not to 
slacken the pace in resolving the 
issue of creating safe areas and of 
working on questions which have 
already been agreed." He gave no 

rtataite 

On the day Nato took part in 
combat for the first time In its 
40-year existence, Russia also 
indicated its willingness to forge 
closer links with the western alli- 
ance. 

Mr Vitaly Churkin, deputy for- 
eign minister and special envoy 
to former Yugoslavia, announced 
that Moscow would soon sign up 


PAGE 2 

■ Western alliance fires first 
shots in anger 

■ Serbs stg beSeve they hoW 
winning card s 

■ ‘Circus' turns deadly serious 

■ Editorial Comment Page 17 

to Nato's “partnership for peace”, 
which envisages closer military 
co-operation with the aHianre . He 
was speaking after talks in 
Moscow with three Nato ambas- 
sadors. 

Russia's endorsement of the 
peace plan - a week after Presi- 
dent Boris Yeltsin promised a 
more assertive foreign policy - 
lent credence to Mr Churkin’s 
promise that Russia was deter- 
mined to conduct a foreign policy 
“not aimed at worsening con- 
flicts'’ but worthy of “a great sov- 
ereign state". 

Mr Churkin refrained from 
directly blaming the Bosnian 
Serbs for provoking the Nato 
urtaffk , xhe four Caleb light fight- 
ers were shot down north-west of 
the Bosnian capital Sarajevo 
after they had violated the 
United Nations no-fly zone. The 
UN resolution bans unauthorised 
flights by ail fixed-wing aircraft 
and helicopters in airspace over 
the republic of Bosnia-Hercego- 
vina. Nato declared the no-fly 
zone in April 1993. 


Russia, which is playing a piv- 
otal role in the peace talks on 
former Yugoslavia, defended 
Nato’s action, saying in a state- 
ment it was in accordance with 
the UN security council resolu- 
tion passed in October 1992. 

“Whoever carried out the mili- 
tary sortie over Bos- 
nia . . . bears frill responsibility 
for what happened," the state- 
ment said, according to Itar-Tass 
news agency. 

in Washington, President Bill 
Clinton said the White House had 
been In touch with Moscow “and 
we have explained what hap- 
pened”. Other, western leaders, 
including Mr John Major, the 
British prime minister, who was 
visiting Mr Clinton, supported 
the action. 

In Belgrade, there was no offi- 
cial comment from PresidentSlo- 
bodan Milosevic of Serbia. Mr 
Karadzic refused to confirm that 
the aircraft shot down were those 
of his forces. “We simply do not 
know the truth yet,” he said at 
Belgrade airport before leaving 
for Moscow. An earlier statement 
from the Bosnian Soil army said 
its aircraft had “never breached 
the no-fly zone since it into 
force". 

UN officials said more than 
1,600 violations of the no-fly zone 
had taken place, carried out by 
Croat, Moslem and Serb forces. 

“Every attempt was made to 



A ■ 


BID Clinton explains to reporters the shooting-down of four Serb 
aircraft which defied the UN imposed no-fiy role over Bosnia 


the best of our information to 
avoid this encounter." Mr Clinton 
said yesterday morning. He 
added that the US pilots had 
issued two warnings to the six 
Galeb aircraft before opening 
Ore. 

Lata-, Vice-president AI Gore 
went further, saying the incident 


would reinforce other statements 
by Nato or the United Nations. 

“Than is much we still need to 
learn about why these aircraft 
would at tempt their mission, but 
Ear from damaging the prospects 
for peace, it may actually 
improve the prospects for peace,” 
he said. 


Worries over excess government borrowings overshadow Singh’s budget speech 

India goes for liberalisation and growth 


By Stefan Wagstyt and 
Shiraz Sidhva hi New Delhi 

Mr Manmohan Singh, the Indian 
finance minister, announced 
measures to liberalise the econ- 
omy and promote growth yester- 
day, improving convertibility of 
the rupee and cutting interest 
rates, customs duties and taxes. 

But the reforms, set out in the 
annual budget speech, were over- 
shadowed fay an admission that 
government borrowings have 
soared in the past year for above 
targets - to levels at which they 
are prompting some observers to 
voice fears about the country's 
economic stability. 

Mr Singh disclosed that 
because of lower than expected 
tax and customs revenues and 
higher than anticipated spending 
on subsidies and other items, the 


fiscal deficit for the year to the 
end of March would be about 12 
per cent of gross domestic prod- 
uct, compared with a target of 4.7 
percent 

The target for the new year 
starting in April is to be 6 per 
cent 

The budget was widely seen as 
a bet on growth - that increased 
economic activity would lead to 
higher government revenues and 
so eventually bring down public 
borrowing. Mr Singh admitted as 
much in his speech, saying that 
the risks he was taking were pru- 
dent 

Industrialists publicly hailed 
the steps taken to encourage 
growth, but they expressed fears 
'about the fiscal deficit and disap- 
pointment at the lack of bold new 
deregulatory initiatives. The 
Bombay stock exchange 30-share 


index closed 50.37 points up on 
the day at 4^87.98. 

Mr Singh was presenting his 
fourth budget since the govern- 
ment took office in 1991 and 
responded to a balance of pay- 
ments crisis by embarking on 
India's most extensive economic 
reforms since independence. . 

He expressed concern about 
the fiscal deficit and pledged to 
“return to the path of fiscal recti- 
tude". He promised to continue 
with pro-market reform and pro- 
moting international trade and 
investment \ 

He highlighted the achieve- 
ments on the external account - 
including a 21 per cent increase 
in exports in the first 10 months 
of 199344 and a rise in foreign 
exchange reserves from Gbn in 
mid 1991 to a record $13bn. He 
said the government would make 


early repayment of $L4bn due to 
the International Monetary Fund 
and borrowed during the 1991 cri- 
sis. 

The rupee, already convertible 
for trade dealings, is also to be 
made freely exchangeable an the 
current account. Restrictions 
remain on capital transactions 
involving the sale and purchase 
of assets. 

Mr Singh's other specific pro- 
posals indude a cat in the maxi- 


mum rate of customs duty from 
85 per cent to 65 per cent, a 
reduction in the maximum rate 
of corporate tax including sur- 
charges from 65 per cent to 55 per 
cent, and a cut in income taxes. 
T be complex domestic sales tax 
is to be overhauled. Reform of 
th« financial markafer is to con- 
tinue, with measures to enhance 
investor protection, help recapi- 
talise banks and liberalise the 
insurance industry. 


banks 
inquire 
into hedge 
fund risks 

By Sara Webb in London 

Leading central banks are 
investigating the risks to the 
world’s financial system posed by 
highly geared US hedge funds - 
aggressively managed pools of 
private money - in the wake of 
recent turbulence in European 
bond marketS- 

The Wank of England is holding 
talks with UK clearing and mer- 
chant hanks and has sent them a 
questionnaire seeking a clearer 
picture of the risks Involved and 
the extent of the banks' exposure 
to hedge fluids. The Federal 
Reserve is doing much the same 
in the US. 

Mr Otmar twringr chief econo- 
mist of the Bundesbank, said any 
new regulation of hedge funds 
must be considered slowly and 
carefully because new guidelines 
inevitably led to attempts to cir- 
cumvent the rules, which must 
be anticipated. 

Heavy selling by US hedge 
funds has been a leading factor 
hrfiind the steep decline in Euro- 
pean government bond markets 
in the past fortnight That has 
led to concern that some of the 
gmaTier ftiwrfa might be in finan- 
cial difficulty. 

Some hedge an d futures funds 
lost as much as 25 per cent of 
their value in February, accord- 
ing to preliminary figures from 
Tass Management, a fund data- 
base that monitors the sector. 

The Rank of England's main 
concern is over the exposure of 
UK clearing and merchant banks, 
both as government bond mar- 
ketmakera and as investors in 
bonds themselves. It wants to 
know whether banks’ dealings 
with the hedge funds are backed 
by adequate collateral. 

The bank is concerned in par- 
ticular about financing arrange- 
ments. Hedge funds have been 
ahu» to obtain funding from many 
banks at no margin, effectively 
borrowing $100 against the secu- 
rity of $100 worth of bonds. 

The Bank of En gland considers 
that to be very risky, given the 
collapse In bond prices. If a hedge 
fund were to fell, a lender might 

Continued on Page 18 
Editorial Comment, Page 17 
Lex, Page 18 
Bond markets, Page 24 


“1 need a couple of muicoats 
cleaned overnight. 77 


MCI invests $1.3bn in voice 
and data link with Nextel 


By Louise Keftoe 
in San Francisco 

MCI Communications of the US 
is to enter the mobile communi- 
cations market with the phased 
acquisition of a 17 per cent stake 
in Nextel for about $Ubo. 

MCI, the country’s second larg- 
est long-distance telephone com- 
pany, will jointly market digital 
voice and data wireless services 
with Nextel, also of the US, and 
Comcast, another Nextel share- 
holder. 

The move Is seen as MCTs 
response to rival AT&T's planned 
acquisition of McCaw Cellular 
Communications, the largest US 
cellular telephone company. 

Nextel operates a radio net- 
work for taxis and fleet vehicles. 
Last year the company acquired 
mobile radio frequency rights 
from Motorola, the US electronics 
group, it plans to create a 
national network using Moto- 
rola’s technology, offering ser- 
vices Including mobile tele- 
phones, messaging and paging. 


The Nextel alliance will further 
MCrs ambitions in US local tele- 
phone markets. 

Mr Bert Roberts, MCI chief 
executive, said: "MCI’s invest- 
ment in Nextel will accelerate 
the availability of advanced wire- 
less voice and data communica- 
tions." 

Mr Morgan O’Brien. Nextel chair- 
man, said* "This alliance irumns 
that everyone else will be playing 
catch up." MCTs marketing and 
customer base would allow the 
company to extend beyond Its 
core of business customers, he 
added. 

Last year British Telecom 
acquired a 20 per cent stake in 
MCI for $4 .3 bn in cash - funds 
that the company is now using to 
finance its expansion. 

Motorola received a 20 per cent 
stake in Nextel in exchange for 
its radio licences. Other Nextel 
shareholders include Comcast, a 
US cable televison and cellular 
phone service company, which a 
holds a 17 per cent stake; Matsus- 
hita Communications, of Japan, 


CONTENTS 


which owns about 5 per cent, 
NTT, also of Japan, with 1 par 
cent 

MCI will purchase about 17 per 
cent of Nextel's stock, which win 
match Comcast’s stake. The ini- 
tial purchase, expected to occur 
in a few months, will consist of 
22m shares for about $80Qm, or 
$36 per share. MCI has also 
undertaken to purchase another 
15m shares at an average cost of 
$28 per share over the next three 
years, for a total investment of 
more than $L3bn. 

Nextel’s integrated mobile com- 
munications service operates in 
Los Angeles, and will be avail- 
able throughout California this 
year. 

As part of the alliance. Md 
and Comcast have altered into a 
shareholders’ agreement with, 
equal representation, and 
together will own approximately 
35 per cent of Nextel. 

Nextel’s share price yesterday 
rose $38% to $43% by midsesskm. 
MCI was trading at $27%, up 
from $26%. 


Euopean Nam. 


-2J Leader Page . 


MoredoralNaws. 

8.7 

Letters 

16 

Amaiean News _ 
World Trade News 

4 

Management — _ 
Oteanaer 

12 

17 

Ream* 


TccfTOogy 






t m . 

ffl 

TV and Rads 

15 


Can Europe ConpeM__ 10 FT Actuates . 
.17 CnsHOd 30 KEcwhfc 


9— IntaT na Soo 3 2 £ 3 




© THE FINANCIAL TIMES LIMITED 1994 No 32,305 Week No 9 


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24 Ec?*yO(*ons 42 UWlonSE. 

.2623 H Bond Sendee .24 

Managed Finte 34-38 

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FINANCIAL TIMES TUESDAY MARCH 1 1994 

NEWS: EUROPE 1 • 


Western military alliance fires its first shots in anger 



The North Atlantic 
Treaty Organisation 
is universally 
regarded as the 
world's most power- 
I ful and best organ- 

ised military alliance, and is cred- 
ited with having won the cold war 
by its successful defence of western 
Europe against the overwhelming 
military power of the Soviet bloc. 

Yet the extraordinary fact is that 
its strength and resolve had never 
been tested in actual combat - until 
yesterday Serb aircraft rushed in 
where Soviet leaders from Stalin to 
Gorbachev had feared to tread. 

The cold war is in feet a classic 
instance of the old Roman adage, "if 
you want peace, prepare for war”. 


Edward Mortimer on Nato’s changing role with the end of the cold war 


For 40 years Nato filled the north 
German plain with heavily armed 
combat units, patrolled the sides 
and sea lanes of Europe and the 
north Atlantic with innumerable 
aircraft and ships, and deployed 
nuclear weapons of various ranges 
aimed at Soviet and east European 
targets. All these forces and equip- 
ment were honed with constant 
exercises, but none of them were 
actually used, because the Soviet 
Union never attached. 

Of course, individual members of 
Nato have been involved in military 
action in various parts of the world 


and sometimes several of them 
together - the most spectacular 
example in recent times being the 
Gulf war. Bat those were not Nato 
operations. The long experience of 
training anrf exercising together in 
Nato came in very useful; forces 
were diverted from Nato dudes, and 
various Nato logistical assets such 
as pipelines or communications 
equipment were used. But the alli- 
ance as such was not involved. 

Only in the past two years has 
Nato begun to envisage collective 
action "out of area", that is outside 
the territory, waters and airspace of 


its member states which it is 
pledged to defend. It has done so 
partly in search of a post-cold war 
rule, partly oat of awareness that 
European security is now threat- 
ened much more by conflicts wtthin 
or between the former communist 
states than by any directly hostile 
intentions towards Nato members. 

At Oslo, in June 1992, the alliance 
offered its services for peacekeeping 
duties to the Conference on Secu- 
rity and Co-operation in Europe, 
w h ich was supposed to become the 
main regional collective security 
organisation in Europe under the 


UN. Bat events in the Balkans 
moved too fast for the CSCE to get 
its act together, and Nato soon 
found itself dealing directly with 
the UN, as an through 

which various Security Council res- 
olutions could be implemented. 

Since July 1992 a combined Nato- 
Westem European Union taskforce 
has been policing UN sanctions in 
the Adriatic, and since November 
1992 it has had powers to stop and 
search ships for this purpose. Nato 
has also provided the headquarters 
unit of the UN protection force 
(Unprofor) in Bosnia. 


When the Security Council 
imposed the no-fly -zone (NFZ) In 
Bosnia in October 1992, Nato pro- 
vided Awacs air surveillance air- 
craft to monitor it On March 31, 
1993, the Security Council author- 
ised use of force against aircraft vio- 
lating the NFZ, and on April 2 the 
North Atlantic Council CNato’s gov- 
erning body) agreed to provide that 
force. As Mr Manfred Warner, 
Nato’s secretary-general, said at the 
Hm<v “it is the first form that thw? 
alliance will ran a military opera- 
tion in practice, not in exercise. It is 
the first time that this wfll take 


place out of our area. It is the first 
time that it happens in support of a 
United Nations resolution.” 

Last June Nato went further, 
offering “protective air power in 
case of attack against Unprofor in 
the performance of its cryerali man- 
date”. In August, and a gain in Janu- 
ary and February, it issued specific 
threats of air strikes against Serb 
positions. Although these threats 
were subject to UN request, they 
were regarded by many, and nota- 
bly by the Russians, as going 
beyond what the Security Councfl. 
had authorised. But the shooting 
down, after warning, of aircraft vio- 
lating the NFZ is clearly within the 
letter as well as the spirit of Secu- 
rity Council resolutions. 


Belgrade hopes to exploit Russia’s intervention in complex moves for peace settlement 

Serbs still believe they hold winning 


Nato turns words into action 



pects for a Croat-Moslem alii- 


‘Circus’ turns 
deadly serious 


By Laura SUber m Belgrade 

Russia’s entry Into Bosnian 
peace moves has boosted the 
confidence of Serb leaders, who 
believe they can shape the 
map. Dot only of Bosnia, but of 
all former Yugoslavia. 

President Slobodan Milos- 
evic, who emerged almost tri- 
umphant from recent confron- 
tation with Nato over Sarajevo, 
was silent in the immediate 
aftermath of the shooting 
down of aircraft over Bosnia 
yesterday. But he is using Serb 
forces in a way that shows he 
is convinced Serbia still holds 
the key. 

Serb officials believe Bel- 
grade has seized control, via 
Moscow, of the political agenda 
for helping to end the war. 

Over the past week, Serbian 
media found every opportunity 
to praise President Boris Yelt- 
sin, formerly dubbed "an 
enemy of tbe Serbian people 
and the Orthodox world". After 
supporting Mr Yeltsin's pro- 
posal for a “great powers" 
summit on Bosnia, Mr Vladis- 
lav Jovanovic. Serbian foreign 
minister, even accused the 
west of “being more interested 
in blocking the Russian initia- 
tive than in putting forward an 
alternate plan”. 

In this vein, Serb officials 
believe the US is pursuing its 
own agenda, seeking to restore 
the Croatian-Moslem alliance 
so as to provide a balance of 
military power in Bosnia. This 
could Isolate the Serbs and 


force them to make conces- 
sions but the gamble could 
backfire. “Serbia cannot be 
excluded from any peace agree- 
ment,” a UN diplomat said. 

The US plan would under- 
mine the alliance cultivated in 
secret between Zagreb and Bel- 
grade, aimed at dividing Bos- 
nia at the expense of the Mos- 
lems. With Croatia and Serbia 
about to normalise relations, 
there is one outstanding issue: 
the status of Serb-held terri- 
tory in Croatia, frozen under 
United Nations supervision. 

According to senior Croatian 
officials. Washington has 
promised to guarantee return 
of those territories to Zagreb in 
exchange for Croatian backing 
ol the US peace plan. But in a 
threatening broadcast, Bel- 
grade radio on Sunday warned 
that the US moves could not 
only provoke clashes in Bosnia 
but lead to renewed fighting in 
Croatia between Serbs and 
Croats. Mr Jovanovic yester- 
day called it a "bellicose plan”, 
warning Zagreb to side with 
Belgrade despite US pressure. 

These statements reflect Mr 
Milosevic's belief he can derail 
the US initiative and weaken 
his adversaries. Recent events 
support this view. 

• While Serb forces waged an 
offensive against the Bihac 
enclave in north-west Bosnia, 



Line of internal 

*-* confrontation 


fierce opponent of Bosnian 
President Alija Izetbegovlc. 

• There has been a stand-off 
between Serb forces and UN 
troops at a bridge over the 
River Sava linking Serb-held 


grade, could make trouble. 

• Serb forces in the Dalma- 
tian hinterland are poised 
again to destroy the strategic 
Maslenica bridge, which is now 
operating. The bridge joins 


ance, Belgrade fears the US 
will use the alliance to exert 
pressure on Bosnian Serbs to 
give up mare land. This could 
include ceding access to the 
northern River Sava, which 
would effectively sever the 
east- west corridor linking 


cards 

Serbia with other Serb-held ter- 
ritory in western Bosnian and 
Croatia 

“This would result in a new 
round of fi ghtin g tn northern 
Bosnia. The Moslems would 
probably join with tbe Croats 
to cut the corridor. The Serbs 
would li ght Againgf Hifa tooth 
and nail,” argues Mr Predrag 
Smic, head of the Institute for 
International Politics and 
Economy in Belgrade. 

But Mr Milosevic is aware 
that if the war continues, the 
Serbs may lose their consider- 
able advantage over the Mos- 
lems and Croats. More war 
would prolong Serbia’s isola- 
tion. UN sanctions, imposed 21 
months ago for Belgrade’s role 
in the violent partition of Bos- 
nia, would remain in force 
without a peace agreement 

But there is little doubt 
among Serbs that Serb-held 
land in Bnania will SOCHI 
with Serbia proper. The ques- 
tion that Belgrade wants to 
resolve is the future dimen- 
sions of Greater Sertrta- 

While watching what role 
the US plays, Serbian leaders 
are already confident the bal- 
ance of forces now involved in 
the peace talks has fundamen- 
tally chang Bri. 

“Russia and the US are 
playing an old fashioned game 
called the cold war, with Bos- 
nia as a magnet,” says Mr 
Simic. While the Serb leader- 
ship awaits Moscow's next 
move, the Serbs believe Russia 
will defend thwm. 


By Laura saber in Belgrade 
and Judy Dempsey bi London 

A United Nations official in 
Zagreb said yesterday that the 
no-fly zone over Bosnia- 
Hercegovina had been a “cir- 
cus” since Nato aircraft began 
enforcing it some 10 mouths 
ago. 

The UN declared the no-fly 
zone on October 9, 1992. Nato 
aircraft started enforcing tt on 
April 12, 1993. 

Under UN resolution 816, 
backed by Russia, no fixed- 
wing aircraft or helicopters 
are allowed to fly over Bosnia 
without prior permission and 
clearance from the UN. 

The aim of the resolution, 
directed at Bosnian-Serb 
forces, Croatian aircraft and 
Bosnian government helicop- 
ters, was to prevent munitions 
and supplies reaching all three 
armies. 

Bosnian Sobs began with a 
numerical advantage, since 
their air force was inherited 
from the former Yugoslav 
army. The Bosnian-Serb air 
force includes 30 fixed-wing 
jets - 12 Galeb and Jastreb 
light attack aircraft, 12 ex- 
Yugoslav Orao fighter bomb- 
ers, six Russian-made BEG-21 
fighters - and.15 Gazelle heli- 
copters 

The Bosnian army is 
equipped with helicopters and 
light aircraft, while Croatia 
has four MIGs, although 
unconfirmed reports claim 


that the Croatian air force has 
acquired an additional 16 

vacs. 

Since the enforcement of the 
no-fly zone, numerous viola- 
tions have taken place. 

According to UN officials In 
Belgrade and Zagreb, 1,397 
violations were recorded 
between October 1992 and Jan- 
uary l, 1994. They add that 
between January 24 and Feb- 
ruary 17 alone, there were 152 
violations, with the Bosnian 
Moslems responsible for 77, 
the Croats for 55, and tbe 
Serbs 19. 

Most of these violations 
were by helicopters transport- 
ing munitions and perso nn el 
into military zones. 

UN officials say that 
between last December 20 and 
January 24, the vast majority 
of the 65 violations were car- 
ried out by Modem and (host 
forces, mostly over central 
Bosnia. 

More than 170 Nato aircraft 
have carried out 7,250 sorties, 
or fighter missions over Bos- 
nia. Most of the aircraft fly out 
from the Italian air base of 
Aviano, Nato’s largest base in 
southern Europe. The US, the 
Netherlands, France. 
Britain .Spain and Turkey are 
Involved In the sorties, known 
as “Operation Deny Flight”. 

The sorties are backed up by 
Awacs surveillance aircraft 
and fuel tankers. Altogether, 
Nato has carried out 13,650 
sorties over Bosnia. 


Bosnian Serb leaders last week 
in Belgrade signed a defence 
pact with Mr Fflcret Abdic. He . 
is the renegade Moslem chief 
from the Bihac region who is a 


territories in Croatia and Bos- 
nia - to warn Zagreb that local 
Serbs, under control of Bel- 


.northern Croatia with its 
southern Adriatic coasts. 
While sceptical about pros- 


Deals struck on 
east German 
coal and power 


By Quentin Peel in Bonn 

Germany's three largest 
energy utilities yesterday 
announced agreement to take 
over the lion's share of east 
Germany's power generating 
and coal mining industries, in 
two deals valued at more than 
DMIObn ($5.6bn). 

The deals are the climax of 
two years of often bitter and 
complex negotiations with the 
Treuhand privatisation agency 
and the German government. 

The big three - Essen-based 
RWE, PreussenElektra, owned 
by Veba, and Munich-based 
Bayemwerk - will jointly own 
75 per cent of Veag, the main 
east German electricity com- 
pany, with the remaning 25 
per cent going to five smaller 
western utilities. The purchase 
price is around DMSbn. 

The takeover of the giant 
Lausitz brown coal fields (Lau- 
bag), for a price of DM2.1bn, 
will involve the shareholders 
in a further investment of 
DM6ba over the next 20 years, 
according to Mr Friedhelm 
Gieske, RWE’s chief executive. 

The Rheinbraun subsidiary 
of RWE will be the 51 per cent 
majority shareholder in Lau- 
bag, with PreussenElektra tak- 
ing 30 per cent, and Bayem- 
werk 15 per cent. RWE Eneigie 
will hold tbe balance. 

The deals were announced in 
Bonn after a meeting of gov- 
ernment and industry leaders 
chaired by Chancellor Helmut 
KohL They represent tbe final 
step in privatising the entire 
east German energy Industry. 
Last year, the Treuhand agreed 
the sale of the other main 
brown coal mining operation. 


Mibrag, to an Anglo-American 
consortium involving Britain's 
PowerGen, NRG Energy of 
Minneapolis, and Morrison 
Knudsen of Idaho. 

The whole process was 
delayed by legal challenges 
from east German local author- 
ities. who sought to control a 
larger share of the lucrative 
power generation industry 
themselves. The states of Sax- 
ony and. Brandenburg are still 
seeking a bigger say in the 
operations. 

Veag supplies some 70 per 
cent of east German electricity, 
primarily from brown coal- 
fired power stations. It had a 
turnover of DM6.4bn in 1992, 
and made profits of just 
DM7 Jm. Since 1990. its work- 
force has been halved to 
around 14,500. 

Mr Gieske confirmed the 
planned investment of DM6bn 
in Veag over the next 20 years, 
to provide an eventual capacity 
of 7.200MW. 

He said that tbe five Laubag 
opencast mines would be mod- 
ernised and kept in operation 
and five closed. The total work- 
force of 12,000 would be 
reduced to 8,000 by the year 
2000. The mines would eventu- 
ally produce 5045m tonnes of 
coal, compared with current 
capacity of some 75m tonnes. 

Contracts for the two deals 
are to be signed by the middle 
of the year, according to yes- 
terday’s announcement Then 
the utilities wfll have to make 
a downpayment on the 
DM2.lbu purchase price for 
Laubag, followed by further 
payments in the course of oper- 
ation. Payments for Veag will 


Danish 
coalition 
loses its 
majority 

By Hilary Barnes 
in Copenhagen 

Denmark's four-party 

centre-left coalition 
government yesterday lost its 
one-vote majority in the Folk- 
eting when a member of the 
Centre Democratic party 
resigned to sit as an indepen- 
dent for tbe rest of tbe current 
parliament. 

The opposition is expected to 
try to exploit the change to 
force the government into call- 
ing an early election. However, 
the dissident Centre Democrat, 
Mrs Bente Juncker, has said 
that as long as the government 
sticks to the policy programme 
agreed when the government 
was formed in January last 
year she would not help to 
bring it down. 

An election to the Folketing 
must be called by the prime 
minister, Mr Poul Nyrup Ras- 
mussen, the Social Democratic 
party leader, by December 6. 
Mr Rasmussen has repeatedly 
said that he wilL postpone 
calling an election as long as 
possible. 

Mrs Juncker was appointed 
minister for social affairs, 
replacing a Social Democratic 
minister, in a cabinet reshuffle 
on January 27. The reshuffle 
was intended to strengthen the 
government in general and the 
Centre Democrats in particular 
in the run-up to the election, 
but it went badly wrong. 

Two weeks after the reshuf- 
fle Mrs Juncker was dismissed 
for passing on libellous 
rumours to journalists con- 
cerning the head of a home for 
mentally retarded adults. 

Recent opinion polls suggest 
that the government - made 
up of the Social Democrats, the 
Centre Democrats, the Chris- 
tian People's party and the 
Radical Liberals - will lose 
seats in an election. There is a 
risk that the Centre Demo- 
crats. with nine seats, and 
the Christian People's party, 
with four seats, will be elimi- 
nated from the Folketing alto- 
gether. 

If an election result were to 
follow the opinion polls. Mr 
Rasmussen would continue to 
have a good chance of forming 
a minority administration, but 
he would have to rely on the 
support of the left-wing Social- 
ist People’s party. 


also be spread over 20 years. 

Industrial unrest 
hits transport 

Striking transport workers disrupted German cities yesterday as 
industrial unrest spread from the engineering industry to tbe 
public sector, Reuter reports from Frankfort. 

Bus and train drivers in the industrial heartland of North- 
Rhine Westphalia prevented thousands from getting to work on 
time- Protest stoppages lasted for several hours. 

The action against calls by the employers for a wage freeze and 
benefit cuts was the latest in a series of disputes over pay and job 
security which are hitting the German economy as it struggles to 
emerge from recession. 


Fiat workers back deal to save jobs 


By Robert Graham In Rome 

Works councils at Elat's Italian 
vehicle plants have over- 
whelmingly endorsed a com- 
plex government-sponsored 
agreement avoiding large-scale 
job losses. 

The deal directly affects 
16.000 of Fiat’s 95,000 vehicle 
workforce and was brokered by 
Mr Gini Giugni. the labour 
minister, between the Fiat 
management and union leaders 
last Monday. 

The Fiom. the main engi- 
neering union, insisted the 
agreement be put to a shop- 
floor vote because Fiat's plans 
to cut its workforce by more 


than 5 per cent and lay off a 
farther 10 per cent had pro- 
voked serious unrest in the 
previous three weeks. 

Although less than 60 per 
cent of the workforce voted, 
almost 90 per cent favoured the 
deal in most plants. 

The closest vote was at 
Alfa’s Arose plant outside 
Milan, believed by the unions 
to be threatened with closure. 
Here, 55 per cent accepted the 
agreement. 

The high numbers in favour 
suggested that employees pre- 
viously threatened with job 
losses or up to two years laid 
off (and with an uncertain 
future after that) opted for a 


generous package of work 
sharing and early retirement 

The more militant among 
the unions rejected the deal 
because they said it funded job 
cuts at Fiat without any dear 
future industrial strategy. 

The deal is based round four 
points; early retirement for 
6,600 workers and staff; “soli- 
darity contracts” covering 
some 3*>00 jobs and affecting 
8.700 people, involving a 
shorter working week, salary 
cuts and job sharing; govern- 
ment s ubsidis ed retra i n in g a nd 
job hunting for 2^00; and the 
commitment to spend up to 
L450bn (£182m) an the develop- 


According to the latest esti- 
mates of the labour ministry, 
the agreement will cost some 
L310bn more than tbe original 
package cf job pruning mea- 
sures proposed by Fiat last 
November. Of this L220bn will 
cover early retirement, split 
jointly between the govern- 
ment and Fiat A further L90bn 
covers the solidarity contracts 
over the next three years. 

The funds earmarked for the 
development of a dean car 
include over L300bn for an 
electric car. These funds were 
already in the ministry of sci- 
ence budget 

Put together the overall cost 
of achieving labour peace at 


Fiat and allowing the Turin- 
based group tbe means to fight 
the recession in the automo- 
tive business over the next 
three years comes close 
LSOObn. 

This figure also excludes the 
cost to the social security bud- 
get of 4JOO persons to be cov- 
ered by temporary lay-offs 
until 1996. 

With unemployment still ris- 
ing it is extremely doubtful 
whether the next government 
can afford to be so generous in 
offsetting job losses. Over the 
weekend, Prof Mario Monti, 
one Italy’s leading economists, 
was highly critical of the Fiat 

packag e. 


meat of a clean car. 

Bank of Italy warns on budget deficit 


By Robert Qraham 

The Bank of Italy yesterday 
warned of a growing budget 
deficit in 1994, thanks to a 
deeper than expected economic 
recession and administrative 
delays in public spending cuts. 

The warning was contained 
In the central bank's half 
yearly economic report, which 
was cautious on the possibility 
of an early recovery and 
predicted a further deteriora- 
tion in unemployment. 


The report’s publication yes- 
terday coincided with the 
opening of the campaign for 
the March 27 general elections 
and the announcement of the 
main parties’ economic pro- 
grammes. 

As such, tbe report is a 
sober reminder of the limited 
economic policy options for 
the next government 
Behind guarded language, 
the central bank is aHwn p ting 1 
to hammer home the message 
that the reform of Italy’s pub- 


lic accounts by the Amato and 
Ciampi governments Is far 
from over. The implicit sug- 
gestion is that the next gov- 
ernment will have to introduce 
a mid-year mini-budget 
Such a view flies in the face 
of the electoral propaganda of 
the Forza Italia movement of 
Mr Sflvio Berlusconi the media 
magnate. Mr Berlusconi is 
promising to reduce fiscal 
pressure and preside over an 
early recovery for “a new Ital- 
ian miracle”. 


The report says provisional 
figures for last year suggest 
that the economy recorded a 
negative growth of 0.7 per cent 
against the modest per cent 
increase tbe previous year. 

Record export growth only 
partially offset the severe drop 
in domestic demand. 

For 1994, the bank says it is 
too early to judge whether the 
official growth target of 1.6 
per cart can be achieved. 

The report says the 1994 
budget’s aim of holding the 


public sector deficit to 
L144,000bu (£57.6bn), equiva- 
lent to 8.7 per cent of gross 
domestic product, will be hard 
to achieve. 

“The 1994 financial objec- 
tives will be complicated by 
lower than expected growth in 
production, especially as a 
result of 1993, and by spend- 
ing cuts having less effect 
than desired because of diffi- 
culties in introducing struc- 
tural changes In a short time,” 
it says. 


Opposition accuses government of undermining minimum wage 

French unemployment rise slows 



Mr Michel Giraud: 
“dear deceleration” 


By David Buchan in Parte 

The rate of increase In 
France's record unemployment 
is slowing, but the politics of 
how it is ever to be reduced is 
hotting up. with the Socialist 
opposition and unions accus- 
ing the conservative Balladur 
government of undermining 
the minimum wage. 

Insee, the official govern- 
ment statistics agency, said 
yesterday that the number of 
unemployed rose by 4.800 in 
January to 3307m, leaving the 
overall jobless rate at 122 per 
cent 

Mr Michel Giraud. the labour 
minister, said this showed a 
“clear deceleration”, because 
for the third successive month 
fewer than 5,000 people had 
joined the dole queue, com- 
pared to monthly increases of 
more than 30,000 in January- 
June 1993 and of more than 


15,000 last autumn. 

Mr Edouard Balladur, prime 
minister, yesterday reacted to 
the January job news in the 
tentative tone he always 
adopts in discussing thi« chief 
bugbear of his gov e r n ment 

His goal of reducing unem- 
ployment in 1995, when France 
elects a new president, “is per- 
haps not out of reach”, he said. 

Mr Balladur went on to com- 
plain of “false de bates based on 
false information” that he was - 
undercutting the country's 
SO-called Smic minimum wage 
for young people. The row was 
sparked by last week's publica- 
tion of decrees implementing 
Mr Giraud’s new employment 
law. 

This allows companies to pay 
workers under the age of 25 
less than the Smic level, but 
generally requires them to 
spend the saving on training 
the young workers. 


Despite a student union’s 
call for a protest and the threat 
of a further row when the gov- 
ernment and unions discuss 
employment on Thursday, Mr 
(brand said he bad no inten- 
tion of changing the law voted 
by parliament last autumn. 
Nor, however, was Mr Girand 
In favour of a specially low 
“youth wage” to price young 
workers into jobs. 

This is in contrast to the 
more radical deregulatory 
views of the British conserva- 
tive government whose 
employment minister, Mr 
David Hunt, will visit Mr 
Giraud in Paris this week. 

• French national output in 
the last quarter of 1993 rose by 
02 per cent aver its level in 
Jaly-September, Insee reported 
yesterday, showing an overall 
0.7 per cent drop for. £993 In the 
French economy compared to 
1992. 


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FINANCIAL TIMES TUESDAY MARCH 1 1994 


NEWS IN BRIEF 


Four Hungarian 
state companies 
put up for sale 


Hungary yesterday launched the country’s FUbn (£25 Am) m?g c 
privatisation programme by announcing the first four public 
oprrap in hotel chain Pannonia, plastics manufacturer Pannon- 
gast, brewer Soproni Sorgyar and Food retailer Global TH, writes 
Nicholas Denton m Budapest A tranche of state shares in the 
national telecoms company. Matav, which remains after the 
p?5m sale (rf 30 per cent to Deutsche Telekom of Germany and 

Amen tech of the US, will follow in the aut umn 
Over several years Budapest expects to sell state shares in 70 
companies worth a total of Ftl20ba, including holdings in MVM, 
the electricity utility, and Mol. the national oil and gas company. 
The government aims to broaden share ownership beyond the 
foreign investors and state company managers who have domi- 
nated Hungary's four-year privatisation drive, though it plans to 
offer only minority tranches in companies already lmmag art by an 
industrial investor. 


While state sell-offs have helped Hungary attract a total of 
S7.1bn of foreign investment, and management buy-outs have 
become more common in the past year, public offeri n gs have 
involved only about 25,000 retail investors out of a population of 
ItaL The privatisation authorities said that they expect to per- 
suade hundreds of thmisamte of Hungarians to pay the token 
Ft2Q00 fee to join the small shareholder prog ramme buy up to 
Ftl00.000 worth of shares on highly preferential terms. 


Bundesbank changes repo rules 

The Bundesbank yesterday called for variable-rate tenders in 
week’s round of securities repurchase agreements, after more 
than three months of fixed-rate deals at 6 per «■*»*, writes Chris- 
topher Parkes in Frankfort. Although surprised, anal ysts ruled 
out any substantial changes hi the so-called repo rate, at which 
the central bank supplies short-term liquidity to the markets. 

While observers agreed that the tender would probably result 
in lower rates, the extent of the decline would be marginal , ar >d 
none expected any early change in the discount lending rate, 
reduced to 5.25 per cent in mid-February. 

Millions of Romanians strike 

Romania's two largest unions said some 2m workers participated 
in yesterday’s general strike, in the biggest union action since the 
overthrow of communist rule in 1988, writes Virgiama Marsh in 
Bucharest. 

The strike, in protest at the lack of economic reform, hit 
hardest in the chemical, petrochemical, metal, transport and food 
industries, the unions said. Harbour workers closed the Danube 
port of Galati and also disrupted shipping at Constanta, the main 
Black Sea port, Radio Bucharest reported. Health and education 
were also seriously affected but roads and tei acftmiminirartiong 
werre unaffected. 

EU aid for Portugal 

Portugal is to receive Es4,450bn (£37bn) in European Union aid 
over the next six years - more than twice as much as in the 
previous six years - according to an agreement signed yesterday, 
writes Peter Wise from Lisbon. 

The aid, equivalent to about 3 per cent of Portugal’s gross 
domestic product over the six years, will he made up of Es3^50bn 
in direct transfers from the EU and EslJ200bn in low-interest 
loans from the European investment Bank. Most of the funds will 
be spent on transport infrastructure. Economists estimate the aid 
will mobilise total private and government investment of more 
than EslO.OOObn up to 1999 and create 100,0 00 jobs. 

Hurd appeal on Macedonia 

Britain's foreign secretary, Mr Douglas Hard, yesterday urged 
Greece to lift its trade embargo against Macedonia and resume 
UN-sponsored talks in the dispute over the former Yugoslav 
republic's flag and constitution, writes Kerin Hope from Athens. 
Mr Hurd, in Athens for talks with Mr Carolos papouhas, his 
Greek opposite number, said the embargo was illegal and unjusti- 
fied and would destabilise Macedonia. He endorsed a Macedonian 
proposal to sign a treaty guaranteeing its frontier with Greece. 

‘Red-green’ outlook in state 

Two weeks before a state election in Lows- Saxony, a poll by the 
German television station Sat 1 shows the Social Democratic 
Party (SPD) and the Bundnis 90/Greens would be able to fo rm a 
so-called “red-green" coalition government, agencies report from 
Bonn. The SPD is currently supported by 47 per cent of the voters 
while the Bundnis 90/Greens are supported by 8 per cent The 
Christian Democratic Union is currently polling 38 per cent of the 
vote. Nationwide, however, a poll shows a mild upswing in 
support for the CDU. 


Dutch economy grows 0.3% 


Netherlands GDP 

Annuel percentage change 

+5-0 — 


+4.0 • 



The Dutch economy grew a real 
0.3 per cent in 1993, toe narrow- 
est expansion in 11 years, toe 
government estimated. Nonethe- 
less, the growth surpassed recent 
expectations of state and private 
economists of zero to 0.2 per cent 
expansion in GDP for last year 
and far exceeded the initial pro- 
jections a year ago that the 
Dutch economy would contract 
by as much as 1.5 per cent in 
1993. The economy grew 0.8 per 
cent in the third quarterfram a 
year earlier and expanded 0.6 per 
cent from toe second quarter. 
The contraction of the economy 
1900 si 92 03 in toe fourth quarter may lay 

oun» Dmastreem the grounds for a possible lapse 

i to recession early this year, should the first-quarter GDP also 
ratract Cold and wet winter weather this year compared with 
st year is likely to have undermined output In the key construc- 
oti sector. The will publish definitive GDP data for the fourth 

larter in April. . _ ...... 

Eastern Germany's industrial output m December declined by 
J per cent from November hut was up 1L2 per cent tram the 
■a r. Eastern German data are not adjusted. November output 
as left unrevised at down 4.4 per cent. 

Pushed by a surge in foreign trade. German plant and machin- 
y orders rose a real 2 per cent in January from a year earlier, 
c VDMA industry group reported. Domestic orders dropped 8 
r cent in January on the year, while foreign order surged 15 per 

Italy's retail sales index was down 0.6 per cent in October from 
year earlier. The index covers sales from 10,000 outlets across 
e country. From January to October toe Index rose 3.1 per cent 



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NEWS: EUROPE 




Yeltsin sacks head of domestic intelligence 

Tit-for-tat expulsion of US diplomat reminiscent of Cold War, reports Leyla Boulton 



Golushko: conscience clear 


President Boris Yeltsin 
yesterday sacked the head of 
his domestic intelligence ser- 
vice, apparently over the bun- 
gled attempt to stop the 
amnesty of his enemies. He 
also presided over toe first tit- 
for-tat expulsion of a US diplo- 
mat under his rule. 

The Higmlqfiqi of Mr Nikolai 
Golushko as head of the 
domestic counter-intelligence 
service, which only in Decem- 
ber replaced toe security min- 
istry. Is the Latest in a series of 
changes to the domestic 
remains of the former KGB. He 


is likely to be succeeded by bis 
deputy, Mr Sergei Stepashin, a 
young former MP seen as 
something of a liberal. 

When the Soviet Union 
broke up, the KGB was split up 
into toe security ministry and 
the external intelligence ser- 
vice. The latter, responsible for 
spying on foreign countries, 
has not been subject to the 
gamp upheavals as Its domestic 
twin. 

Yesterday, the External 
Intelligence Service's success- 
ful miming of a mole in the 
CIA claimed its latest vlctim: 


the expulsion of a US diplomat 
from the Moscow embassy. 

The Russian move, reminis- 
cent of Cold War era tit-for-tat 
expulsions, followed the expul- 
sion of a Russian diplomat 
from Washington after the 
arrest of Mr Aldrich Ames, 
accused of spying for the 
Soviet Union and then Russia. 

Although no explanation was 
provided, the domestic Intelli- 
gence chiefs sacking appears 
to be linked to a separate 
domestic scandal over the 
amnesty granted by parliament 
to Mr Yeltsin’s bitterest foes. 


The men were freed despite 
instructions from Mr Yeltsin to 
Mr Golushko, Mr Victor Yerin. 
the interior minister, and Mr 
Alexei Kazannik, the prosecu- 
tor-general, to treat the 
amnesty as a case of the 
parliament exceeding its pow- 
ers. 

Mr Kazannik, who resigned 
at the weekend, said yesterday 
he had disagreed with the 
objections formulated by Mr 
Yuri Baturin, the president's 
national security adviser, that 
the parliament had granted a 
pardon, which it had no consti- 


tutional right to do, rather 
than an amnesty. 

In further fallout from the 
debacle, Mr Kazannik. a once 
devoted Yeltsin supporter who 
criticised the amnesty and 
gave up bis parliamentary seat 
for Mr Yeltsin in the late 1960s, 
hit back at attacks from the 
presidential entourage for 
alleged haste in freeing the 
leaders of the October coup. 

He said his conscience was 
clear and criticised "those who 
would want to use the law as a 
doormat". 


vote good for peace, bad for economy 


Moldova 

By JHI Barshay in Kishinev 

Moldova’s former communist 
establishment took a huge lead over 
both nationalists and market reform- 
ers In toe war-torn country’s first 
parliamentary elections on Sunday, 
according to preliminary results. 

The vote suggests Moldovans have 
rejected the old nationalist aspiration 
to reunite their former Soviet repub- 
lic with neighbouring Romania and 
want to make peace with their Rus- 
sian-occupied breakaway region of 
Trans-Dneister. With a third of votes 
counted by late yesterday, toe Agrari- 
an-Democratic Party had won 45 per 
cent of toe vote and toe pro-Rossian 
socialist bloc 25 per emit Counting is 


slow in a country of isolated villages 
and poor communications. 

The Agrarian party favours repair- 
ing relations with Moscow and mak- 
ing concessions to the discontented 
Russian minority in Trans-Dneister, 
which boycotted toe elections. Trans- 
Dneister, threatened by the hopes of 
Moldova’s first independent govern- 
ment to merge with Romania, fought 
a breakaway war which claimed 500 
lives in 1992. 

A fragile peace has held since July 
1992, largely through the presence of 
more than 7,000 Russian troops 
there. 

But negotiations have stalled on a 
final political settlement to withdraw 
the Russian troops and grant the 


region a special autonomous status. 

While the Agrarian victory may he 
good for peace, however, it may seri- 
ously damage the economy. The 
party, which is more agrarian than 
democratic, threatens to destroy a 
radical economic reform experiment 
launched last autnnm when toe gov- 
ernment, an informal coalition of for- 
mer communists and economic 
reformers, asked toe west for help. 
Moldova agreed to introduce tight 
monetary policies and to cut inflation 
in return for financial support Now, 
however, the national bank's fastidi- 
ous monetary policies, among the 
most determined in eastern Europe, 
and a newly launched privatisation 
programme may be cast aside before 


the reforms have a chance to take 
hold. 

The prime minister, Mr Andrei San- 
agheli, who ran on the Agrarian 
ticket approved the reform deal, but 
observers say he is not ideologically 
committed to it "There will be credit 
expansion and price Increases,” said 
a reformist economist Mr Anatoly 
Gudim. “It’s inescapable." 

This spring win test the Agrarian 
party. To keep monetary policy in 
check it will need to withstand pres- 
sure from the farm sector, which it 
represents, to issue a wave of credits 
for planting crops. Issuing those 
credits would risk lasing more than 
$2 00m in Internationa] Monetary 
Fund and World Rank loans. But for- 


going spring planting would be 
unthinkable. Agriculture accounts 
for some two-thirds of the economy. 

The national bank governor, Mr 
Leonid Talmacl, who Is technically 
subordinate to the parliament, has 
said he is "ready to resign" if parlia- 
ment orders an expansion in the 
money supply. “Reducing inflation is 
my most important task. 1 will not 
degrade our new currency.” he said. 

The privatisation ministry, headed 
by Mr Vissarion Chesbnev, is under 
fire, too. and he expects to be thrown 
out or office. The Agrarians have 
denounced as illegal his plan to auc- 
tion off a third of state property by 
the end of the year and are calling for 
a complete review of the programme. 



When Hanson acquired Cavenham Forest Industries 
in 1990, it was a case of seeing the trees for the wood. 

Cavenham is one of the United States' largest 
producers of timber, an essential product like coal, bricks, 
sand, gravel and the other basic goods and services in 
which other, equally good Hanson companies specialise. 

Major players in their respective markets, they are 
usually spared the hazards of fickle fashion and leap- 
frogging technology. 

But investing in basic industries is only half the 


Hanson story. The other half is that we never forget 
that our first duty is to our shareholders. 

So we insist on a healthy respect for the bottom 
line, tight financial controls, and performance -related 
incentives. 

A philosophy that has helped the value of our 
company grow from £300,000 to £15 billion in a little 
under 50 years. 

From little acorns, as they say at Cavenham. 

For a copy of our annual report, call 08f 744 8444. 


WE HAVE 98 BILLION BRANCHES, BUT NONE 
ON ANY HIGH STREET. 


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NEWS: WORLD TRADE 


Malaysia sees trebling of telecoms in six years 


By Andrew Adonis n Hong Kong 

The Malaysian govern- 
ment wants to more than 
treble the size of its tele- 
phone network in the next 
six years, and is anxious 
for western telecoms com- 
panies to help, the country’s telecommuni- 
cations minis ter said yesterday. 

Mr Sarny Vellu told an ET conference on 
Asia-Pacific telecommunications in Hong 1 


Kong that Malaysia planned to increa se u$ 
number of phone subscribers from g-3m to 
7.8m by 2000 as “a core aspect of our 
infrastructure modernisation". 

It looked to western operators and 
equipment suppliers to play an “active 
rale". Mr Vellu made no reference to the 
Malaysian government’s ban on state con- 
tracts going to UK companies. 

Cable & Wireless, the UK telecommuni- 
cations group with a majority share In 
Hong Kong Telecom, is keen to invest in 


Malaysia. It has been In talks with Binar- 
iang. a private Malaysian company which 
recently gained a digital cellular telephony 
licence mid is believed to be seeking a 
western strategic partner with which to 
build its network. 

Mr Joseph Farina, president of network 
systems for Nynex, the US regional Bell 
operator which has invested in T hailand , 
said Nynex's joint venture with local part- 
ners to build 2m new lines for the Bang- 
kok area was “an attractive model” for 


other partnership projects in the region, 
notably in China. Nynex is one of several 
US operators Investing in the region's 
countries with emerging markets. 

Mr Farina contrasted the equivalence in 
the number of phones and television sets 
per head in the US - about L2 - with the 
position in Asia. Vietnam has 26 people 
per TV but 435 people per telephone. “That 
is an important validation for us of the 
likely boom in the Asian telecoms mar- 
ket," he said. 


Mr Andrew Harrington. Asia telecoms 
analyst with Salomon Brothers in Hong 
Kong, predicted that the market capital- 
isation of listed telecoms companies in the 
region would increase from about $85bn to 
$L50bn over the next four years, with the 
number of listed companies rising from 
about 20 to 50. 

Mr Alex Arena, Hong Kong’s telecom- 
munications regulator, said the Hong 
Kong government’s aim was to make the 
colony a “telecommunications hub” for 


the region by pursuing strong pitwompeti- 
tion policies. Hong Kong Telecoms 
monopoly in domestic traffic is to expire 
next year. Three companies have been 
licensed to enter the market 

The Australian government is pursuing 
still stronger competition policies, giving 
all city residents the chance to vote to 
rhang p telephone company in municipal 
ballots. Mr Robin Davey, Australian tele- 
communications regulator, said more than 
50 per emit of residents bad voted 



Hungary awards telecoms deals 


Posco wins Korean phone licence 


By Nicholas Denton 
in Budapest 

Alcatel. Compagnie Generale 
des Eaux, US Telecom East 
and other foreign telecom pro- 
viders are among the winners 
of eastern Europe’s first ten- 
der to operate local telephone 
services, Hungary announced 
yesterday. 

The telecommunications 
ministry said the auction of 
the eight-year exclusive local 
concessions had raised FtSJtbn 
($80 m). Foreign- led consortia 
won in 15 of Hungary’s 54 tele- 


phone districts, committing 
themselves to invest Ft20bn in 
the first three years alone. 

Bidders committed them- 
selves to increasing tine den- 
sity by 15.5 per cent a year 
and promised that by 1997 
users would not have to wait 
more than a year for a line. 

CGE. the French public util- 
ity group, paid the highest sin- 
gle fee, of Ftl.3bn, for the 
rights to Szeged, the largest 
city in sooth-eastern Hungary, 
and won one other district. 

United Telecom Services - a 
partnership of French tele- 


coms equipment maker Alcatel 
and US Telecom East, a local 
telecomm uni cations operator 
based in the US - was the win- 
ner in four areas. Central Euro 
Telecom and Hungarian Tele- 
phone & Cable Corporation, 
both US-led consortia, won 
two districts each. 

The capital, Budapest, and 
33 other districts are retained 
by Matav, the national tele- 
communications operator, tn 
which Deutsche Telekom of 
Germany and Ameritech of the 
US took a stake of 30 pea: cent 
for 8875m in December. 


The tender is an element of 
Hungary’s relatively liberal 
line in telecoms policy. AD ow- 
ing separa te local and national 
providers of telephone ser- 
vices, the pattern in the US, is 
unusual in western Europe. 

The telecommunications 
ministry also said it would be 
prepared to grant licences for 
local telephone operators to 
provide cable television ser- 
vices in parallel. Hungary 
would be one of few countries 
where the barrier between 
telecommunications and tele- 
vision has been breached. 


By John Burton in Seoul 

Pobang Iron and Steel (Posco) 
yesterday was selected to lead 
a consortium to operate South 
Korea’s second mobile tele- 
phone network. But the deci- 
sion is unlikely to end the con- 
troversy marring the project 
since it was announced four 
years ago. 

Posco competed against 
Kolon, a textile group, for the 
lucrative licence, which was 
awarded by the Fe deratio n of 
Korean Industries (FED, the 
country's main business organ- 


isation, on behalf of the gov- 
ernment 

Fosco's leadership of the con- 
sortium is likely to raise ques- 
tions about the government's 
commitment to privatise the 
telecommunications industry 
since the steelmaker's largest 
shareholder is the state. 

The FKI explained that 
Posco had offered better tech- 
nology and had stronger capi- 
tal resources than Kolon. It is 
one of the world's most profit- 
able steel companies. 

Posco will take a 15 per cent 
stake in the consortium, fol- 


lowed by Kolon with 14 per 
cent Half of the consortium's 
shareholding will be distrib- 
uted among hundreds of 
domestic companies. 

Mannesmann of Germany 
and Pactel of the US had 
backed Posco, while British 
Telecom and Nynex of the US 
had supported Kolon. 

Foreign companies have 
been promised a 20 per cent 
stake in the venture but they 
must submit new bids, with 
those willing to transfer the 
most advanced technology 
being favoured. 


Three or four foreign tele- 
communications operators are 
expected to be selected by the 
FKI after consultations with 
Posco. Other bidders may 
include Vodafone of the UK, 
Hutchison Telecom of Hong 
Kong, and GTE of the US. 

Foreign companies bidding 
for a share In the consortium 
have privately complained that 
the FKI selection has been gov- 
erned by backroom dealing 
among the domestic partici- 
pants. “This could emerge as a 
major trade issue,” said one US 
official in Seoul 


Wood row goes against Gatt grain 

Michiyo Nakamoto on US pressure on Japan to cut tariffs, on timber imports 


W hen the Ohashis. a 
family living in 
Yokohama, built 
their house, they chose to use 
an American-style structure 
and imported wood from Wash- 
ington state. 

“We really liked the design 
- it’s warm In the winter, cool 
in the summer and keeps the 
moisture out,” the Ohashis 
say. 

They are among a growing 
number of Japanese who are 
choosing North American lum- 
ber for their homes rather than 
the traditional cedar found 
throughout Japan's mountain- 
ous landscape. 

The trend has helped to fuel 
a bustling trade in wood prod- 
ucts imported into Japan not 
only from the American conti- 
nent but from as far off as Fin- 
land and Sweden. 

This trade in wood products 
has become the focus of a row 
between the US and Japan that 
has cast a shadow over the 
Uruguay Round of trade liber- 
alisation talks under the Gen- 
eral Agreement on Tariffs and 
Trade. 

The US is unhappy with an 
offer by Japan to reduce tariffs 
on wood products that was 
made last year to conclude the 


Japan: wood supply 1991 



Uruguay Round talks. 

The Japanese offer was to 
reduce tariffs by 51 per cent on 
a trade-weighted average and 
on certain products by 33 per 
cent in accordance with a sepa- 
rate US-Japan agreement in 
1990. It was accepted last year 
by the US and other countries. 

Since then, however, the US 
has called on Japan to elimi- 
nate tariffs on wood products 


altogether. This has upset Jap- 
anese officials. “We don't want 
to re-open negotiations, we 
don’t want to unravel the pack- 
age," one Japanese official 
said. 

On Friday Japan duly sub- 
mitted its tariff schedules to 
Gatt on the lines of the offer 
made during the Uruguay 
Round negotiations. 

However, pressure on Japan 


to reduce its tariffs on wood 
products further is unlikely to 
be eased. 

In a recent newspaper adver- 
tisement the American Forest 
and Paper Association noted 
that were the Japanese gov- 
ernment to remove its tariffs 
on imported wood, it would 
improve the lifestyle of the 
people, stimulate the economy 
and take leadership on the 
international stage of trade. 

The association noted that 
by some estimates, if tariffs 
were removed, the cost of con- 
structing a wooden house in 
Japan would fall by about 20 
per cent 

It is an argument that is 
likely to find widespread sup- 
port among the Japanese pub- 
lic. frustrated at being charged 
several times more for a house 
than would be the case in most 
other countries. 

The bureaucrats and indus- 
try officials who consider US- 
demands unreasonable argue 
that the re are sound reasons 
for not giving in. 

The first is that the Japanese 
wood industry could be driven 
to annihilation if tariffs are 
removed entirely. The industry 
has already been damaged by 
the flood of imports which now 


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dominate the market. 

In the early 1960s, the Jap- 
anese government, faced with 
a construction boom and a 
shortage of domestic wood sup- 
plies, decided to encourage 
imports by reducing tariffs. 

Since then, the share of for- 
eign wood products has surged 
to 75 per cent of the Japanese 
market, of which US wood 
comprises 28 per cent. 
Together with Canadian wood, 
the 38 per cent market share of 
North American products for 
exceeds that of domestic sup- 
plies. The value of imports has 
doubled from $5.36fan in 1988 to 
|10.89bn in 1992. 

“Our campaign for the 
greater use of wood has bene- 
fited foreign wood products 
more than domestic ones,” 
says Mr Motohiko Wako, 
vice-president of the All Japan 
Federation of Lumber Associa- 
tions. 

Mr Wako explains that North 
American wood has become 
popular In Japan because of 
lower prices and reliable qual- 
ity. 

Mass plantations reduce 
costs while the yen’s rise has 
contributed to the competitive- 
ness of foreign products. 

North American wood is also 
uniform in quality and distri- 
bution is efficient, so that it is 
possible for buyers to order 
wood from the west coast by 
phone without seeing the prod- 
uct Japanese wood varies sig- 
nificantly in quality, so that 
buyers are required to go to a 
lumber market to check an 
quality, Mr Wako says. 

A second argument is that 
because of environmental 
movements in the US and else- 
where, Japan cannot rely on 
imports to supply its huge 
appetite for wood products. 

The US already Imposes 
export restrictions on its wood 
and the Clinton administration 
has announced a policy to limit 
logging to protect the environ- 
ment. As a result North Ameri- 
can lumber prices have dou- 
bled since 1992. 

Japan also has its environ- 
ment to think about when con- 
sidering bow for it can reduce 
tariffs. The plantation of trees 
prevents landslides in Japan's 
mountainous terrain, ensues 
clean water and helps prevent 
global warming, Mr Wako 
says. 



BRITTAN TELLS CHINA NOT TO HIT UK COMPANIES 


Sir Leon Britten, European Commissioner for 
external relations and trade, warned China yes- 
terday not to punish British companies in retal- 
iation for a row over Hong Kong, saying such 
action against any member of the European 
Union was unacceptable, Reuter reports from 


Beijing. Sir Leon is shown above speaking at a 
press conference in Beijing with Ms Wu Yi, 
China’s nmrig tgr of foreign trade, yesterday. 

Sir Leon, holding talks on subjects including 
Beijing’s bid to reenter Gatt, said non-discrimi- 
nation was the basis of EU trade policy. 


Warning by Miti to US 
over retaliation via Gatt 


By Michiyo Nakamoto in Tokyo 

A high-ranking Japanese trade 
official yesterday warned that, 
if the US were to impose sanc- 
tions against Japan and its 
action were found to be in 
breach of Gatt rules, Japan 
could retaliate against the US. 

The US has already 
announced its decision to 
impose sanctions against 
Japan over a dispute regarding 
Japan's opening of its mobile 
phones market There are also 
moves in the US to reinstate 
the Super 301 US trade act 
clause, which gives Washing- 
ton the right to impose 
sanctions a gains t unfair trade 
practices. 

However, Mr Yoshihiro 
Sakamoto, director-general of 
the industrial trade policy 
bureau at the ministry of inter- 
national trade and industry, 


admitted that the yen’s appre- 
ciation, which has hurt Japan's 
exporters and dampened its 
near-term recovery prospects, 
has its benefits for Japanese 
industry tea 

He said that while the yen's 
rapid appreciation has had a 
negative impact on the Japa- 
nese economy, in the long run 
the currency realignment 
would help change Japan’s 
industrial structure by forcing 
a general restructuring. 

*T believe that, over a long 
time span, the higher yen will 
have an impact on the competi- 
tiveness of Japanese goods and 
services and that, as a result, 
Japan's industrial structure 
will change over time.” Mr 
Sakamoto said. “As a result, 
the export-oriented industrial 
structure will gradually 
change as the yen’s apprecia- 
tion forces uncompetitive 


industries to move production 
overseas.” 

The Japanese government 
needed to do more to encour- 
age this change in industrial 
structure, by promoting 
greater inward investment 

The government has targe- 
ted four main areas where it 
will work to change Japan's 
export-oriented industrial 
structure, help increase 
imports and thereby benefit 
consumers as well as reduce 
the country’s huge trade sur- 
plus, a target of international 
criticism. 

The areas are: deregulation 
to help increase imports and 
foreign investment improve- 
ment of government procure- 
ment procedures, new mea- 
sures to increase imports and 
foreign investment, and 
improvements in competition 
policy. 


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FINANCIAL TIMES TUESDAY MARCH ( 1994 


NEWS: THE AMERICAS 


5 


Fed is fighting its comer 

Bentsen may 
modify bank 

proposals 


By George Graham 

in Washington 

Plans to consolidate the 
multi-layered US h ank regula- 
tion system win face a crucial 
test this morning when Mr 
Lloyd Bentsen, Treasury secre- 
tary. presents the administra- 
tion's proposals to the Senate 
banking committee. 

Three months after he out- 
lined plans to draw the four 
federal bank regulatory agen- 
cies into a single federal bank- 
ing commission, Mr Bentsen is 
expected to offer some flexibil- 
ity in order to meet the com- 
plaints of the Federal Reserve 
Board, which is fighting to pre- 
serve its regulatory authority. 

But the Treasury and the 
Fed have not yet reached a 
deal, and the Fed has won con- 
siderable support from an 
array of bankers and state 
banking supervisors who fear 
the concentration of too much 
regulatory power in a single 
agency. 

At the moment, the Fed over- 
sees bank holding companies, 
foreign banks, and state char- 
tered banks which belong to 
the Federal Reserve system. 
Other state banks are moni- 
tored at the federal level by the 
Federal Deposit Insurance Cor- 
poration, which runs the fund 
guaranteeing depositors in the 
event of failure. 

The separate category of 
nationally chartered banks 


comes under the Office of the 
Comptroller of the Currency, 
while savings nntf innn institu- 
tions are overseen by the 
Office of Thrift Supervision. 

The Fed argues that its abil- 
ity to keep in close touch with 
the financial, system and pre- 
vent banking catastrophes 
would be diminished if it were 
reduced to an observer’s role 
in bank supervision, although 
some ba nkin g observers point 
out that well respected central 
banks like the German Bundes- 
bank have no regulatory role 
atalL 

To general surprise, bank 
reform legislation is now 
widely expected to pass Con- 
gress this session. It is likely, 
however, to concentrate on 
measures allowing banks to 
open branches outside their 
home states, not on regulatory 
consolidation. 

An interstate banking bill 
passed the Senate h ankin g 
committee last month by a 
unanimous vote after Senator 
Christopher Dodd of Connecti- 
cut, Who ha« bald up similar 
legislation for years by linking 
it to restrictions on banks’ abil- 
ity to seU Insurance, aban- 
doned Ms opposition. 

The House banting commit- 
tee, whose influential financial 
institutions subcommittee has 
already passed similar legisla- 
tion, is expected to take up the 
inter-state banking bill next 
week. 


Brazil unveils 


details of plan 
for real currency 


By Angus Foster in Sao Paulo 

Brazil yesterday unveiled 
details of its plan to replace 
the currency, the cruzeiro real, 
which is plagued by annual 
inflation of about 2,500 per 
cent 

This is part of an overall eco- 
nomic restructuring pro- 
gramme for Brazil, the only 
large South American economy 
still grappling with near hyper- 
inflation. 

A new accounting unit, tbe 
URV (real unit of value), is to 
come into effect today. Its 
value will be fixed at $1 (67 
pence) but its cruzeiro equiva- 
lent will be increased daily to 
reflect inflation of the local 
currency. Salaries must be 
denominated in URVs, with 
immediate effect The govern- 
ment hopes the private sector 
will switch other prices and 
contracts voluntarily. 

Once the URV has gone into 
widespread use, probably not 
before May. the cruzeiro is to 
be abolished. A new currency 
called the real, fixed at parity 
to the URV, is to take its place. 
The government chose this 
complicated two-step process 
to let contracts be adjusted to 
the new accounting unit and 
avoid legal challenges. 

Mr Winston Fritsch, eco- 
nomic policy secretary, 
described the URV as an •'eco- 
nomic Lobotomy”, designed to 
remove Brazilians’ memory 
and expectation of inflation. 

The country’s profligate gov- 


ernments, federal and state, 
have been forced to issue 
short-term securities at very 
high interest rates to finance 
their budget deficits. This has 
fuelled inflation. Partly as a 
result, the economy has 
become highly indexed, with 
prices often adjusted several 
times each month to reflect 
past inflation. 

The government hopes that, 
by linking all contracts and 
prices to the URV, prices will 
continue to increase in cru- 
zeiro terms but will be stable 
in URV and dollar teams. Once 
people realise the URV is sta- 
ble, expectations of inflation 
will wither. “Only when we 
move to the real will the fall in 
Inflation be rapid," according 
to Mr Fernando Henrique Car- 
doso, finance minister. 

Most economists agree the 
plan works, in theory, and that 
it was correct to tackle the 
budget deficit first The gov- 
ernment finished negotiating 
the budget with Congress last 
week and can now claim it has 
closed a projected deGcit of 
about 5 per cent of GDP. 

Even so. the economic pro- 
gramme still feces many prob- 
lems, especially political pres- 
sures to increase spending 
before the presidential and 
congressional elections in 
October. Also, the compulsory 
conversion of salaries into 
URVs may be unpopular, espe- 
cially since tbe government 
had promised conversion 
would be voluntary. 


Peru telecoms go 
to Spanish bidder 


By Sally Bowen in Lima 

A consortium headed by 
Telefonica de Espafia yester- 
day became the new owner of 
the Peruvian telecommunica- 
tions systems. 

The $2bn <£l.34bn) bid by the 
consortium it led had sur- 
passed the most optimistic 
expectations, easily outbidding 
croups headed by GTE and 
South Western BeWKorea Tele- 
com, which offered $S03m and 
&«57m respectively. 

The sale expands the role of 
Telefonica de Espafia in the 
expanding Latin American 
telecommunications market. It 
already has big stakes in Vene- 
zuela, Argentina and Chile. 

Hundreds packed the audited 
riuui of Lima’s National 
Museum yesterday for the 
opening of the bids in Peru s 
largest privatisation so far. 

The sale was considered a 
success and should boost forth- 
coming privatisations- It was 
rim by UK-based Morgan Gren- 
fell, with Coopers & Lybrand 
as uunagemont consultants. 

The winning consortium has 


three Peruvian partners with 5 
per cent apiece - the Wiese 
Bank, construction company 
Grana y Montero, and brewer 
Backus and Johnston. 

Telefonica Peril, as the new 
operator will call itself, 
acquires 35 per cent of L ima's 
telephone company, CPT, after 
capital increases in the origi- 
nal 20 per cent state holding. 
The remaining shares are held 
privately and are actively 
traded on the Lima stock 
exchange. 

Also. Telefonica wins a 35 
per cent controlling interest in 
Entel, the Peruvian state pro- 
vincial and long-distance 
monopoly. The new owner will 
continue to enjoy monopoly on 
the long-distance service for 
the next five years. 

It is expected that Telefdmca 
will have to invest glbn-Sl Jbn 
over the next five years to 
meet the sale conditions, 
which call for a virtual trebl- 
ing of Peru’s 630,000 lines. The 
company will also have to 
ensure that every Peruvian 
town of more than 600 inhabit- 
ants has a telephone service. 


Major and Clinton mend their fences 


Philip Stephens on the British 
premier’s visit to Pittsburgh 



From left, CIA director James Woolsey, secretary of state Warren Christopher and defence 
secretary William Perry meet John Major at the British embassy in Washington yesterday rouw. 


President Bill Clinton and 
British Prime Minister John 
Major yesterday staged an 
elaborate and selfconsciously 
public reconciliation to repair 
the damage done to 
Anglo-American relations by 
recent disputes over Bosnia 
and Northern Ireland. 

As he prepared to meet Mr 
Clinton In Pittsburgh for a 
series of carefully choreo- 
graphed photo-opportunities, 
Mr Major said that past diffi- 
culties had been “substantially 
pat behind us". 

The Pittsburgh encounter - 
chosen because Mr Major's 
grandfather and father had 
once lived there - followed 
intense talks between Mr 
Major and senior administra- 
tion and congressional figures 
on Bosnia. Russia and British 
policy in Northern Ireland. 

US officials said the two 
leaders’ informal talks in a 
Pittsburgh restaurant and dur- 
ing a visit to a new develop- 
ment on the site of an old 
industrial complex in which 
Mr Major's grandfather might 
once have worked were a dear 
signal that Washington still 
saw Britain as a reliable ally. 

Mr Major’s aides, clearly 
anxious to show the special 
relationship was alive and 
well, went to elaborate lengths 


to point up the generous 
amount of tima Mr Clinton had 
allocated to the visiting prime 
minister. Mr Major was due to 
return to Washington late last 
night to stay with the Clintons 
at the White House. 

For his part Mr Major offered 
unequivocal support for the 
action of US aircraft in Bosnia 
which shot down Serbian air- 
craft violating the United 
Nations nofly zone over the 

former Yugoslav province 

After talks with Vice-Presi- 
dent A1 Gore and Mr Warren 
Christopher, secretary of state, 
Mr Major said US action had 
been ftilly justified: "I think it 
does illustrate that UN resolu- 
tions cannot be ignored with 
impunity. That might be a very 
useful lesson for the future." 

Implicitly acknowledging the 
recent differences between 
London Washington over 
Bosnia. Mr Major added there 
was now full agreement on a 
twin-track approach. 

Praising tbe US for its efforts 
to broker a deal between the 
Bosnian Moslems and Croatia, 
he said the search for a politi- 
cal settlement would go on in 
parallel with, efforts to extend 
the US’s recent success in lift- 
ing the siege of Sarajevo. 
Meanwhile, i .nnHnp and Wash- 
ington would work jointly at 


the UN to return Sarajevo to 
civilian administration. 

Mr Major, who insisted that 
reports of a breach between 
the two governments had been 
"wildly overdone”, also made it 
clear that he expected no real 
dispute over Britain’s approach 
to Northern Ireland. Ques- 


tioned on British anger over 
Mr Clinton's decision to allow 
Mr Gerry Adams. Sinn Fein 
leader, into the US had not 
soured the atmosphere: "That's 
gone. That’s behind us.” He 
now expected Washington to 
back Anglo-Irish attempts at 
political settlement. 


British officials said Mr 
Major had won the support of 
both Mr Christopher and Mr 
Gore for a policy of continuing 
to back Russian President 
Boris Yeltsin despite the threat 
to his position caused by the 
release of the leaders of last 
year’s attempted coup. 


Doubt over 
prospects 
for peace 
in Mexico 

By Damian Fraser 
in Mexico City 

The Mexican government and 
Zapatista rebels have entered 
their second week of talks to 
end the two-month peasant 
uprising in the southern state 
of Chiapas, amid conflicting 
reports on bow dose they are 
to a provisional agreement. 

Bishop Samuel Ruiz, the 
mediator, said a peace declara- 
tion was "already drawn up 
and agreed in fundamental 
terms". He said a draft accord 
could be ready by tomorrow, 
after which rebels would 
return to their villages and 
consult their supporters. 

However, Sub-commandant 
Marcos, the rebel spokesman, 
said there was still no agree- 
ment on crucial issues, such as 
self-rule for indigenous peo- 
ples. national electoral reforms 
and changes to the constitu- 
tion that would permit perma- 
nent re-distribution of land. 

Part of tbe difference 
between him and the bishop 
may be due to the weight given 
to any preliminary accord. The 
rebels have insisted that 
accords are only "mountains of 
paper" and that there am no 
peace until government prom- 
ises arc fulfilled. 


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FINANCIAL TIMES TUESDAY MARCH I 1994 


NEWS: INTERNATIONAL 

Japan reviews housing Legacy of apartheid 
defence policy fails to rat may bless its creator 

By WitBam Dawkins In Tokyo the standards of its regional economy Patti Waldmeir tries to fathom whv some 


The Japanese government 
yesterday opened the first 
review of defence policy for 
nearly 20 years. 

A nine-member panel of busi- 
nessmen, academics and civil 
servants, named by Prime Min- 
ister Morihiro Hosokawa, held 
Its first meeting and is to re- 
port by the summer on Japan's 
changing defence needs. 

It will have to strike a bal- 
ance between pressure for 
defence cuts and fears of 
weaker US commitment to 
Japan’s security when regional 
stability is at risk. 

“As the world has changed 
dramatically after the collapse 
of the Cold War structure, our 
handling of defence and secu- 
rity must change as well," Mr 
Hosokawa told the panel yes- 
terday. 

Any change in defence policy 
is politically sensitive. Only 
three months agio, Mr Keisuke 
Nakanishi, director-general of 
the defence agency (the Japa- 
nese equivalent of defence min- 
ister), resigned after suggest- 
ing Japan's pacifist constit- 
ution be revised to let its sol- 
diers take a combat role under 
United Nations command. 

Japan's military, at 246.000 
personnel is already small by 


the standards of its regional 
neighbours — iwn than half the 
size of that of South Korea. 
Defence spending per head is 
smaller than Italy's. 

This is a consequence of 
Japan’s post-war pacifism and 
reliance on 24,000 US troops, 
190 aircraft, and the 60 vessels 
of the US Seventh Fleet sta- 
tioned in and around Japan. 

The government has started 
to squeeze the defence budget, 
after more than a decade of 
above-average increases, ft win 
rise this year by only 0.8 per 
rant, smallest increase for 
34 years. The Japanese mili- 
tary is also p lanning to reduce 
the number of army bases by 
40 per emit from 1996. 

The right wing of the govern- 
ment coalition believes the per- 
sonnel reduction should be 
accompanied by more spending 
on electronic defence, such as 
the two advanced airborne 
warning and control systems 
aircraft and the upgraded com- 
puters for Patriot missiles 
included in this year’s budget. 

On the other side of the 
debate, the Social Democratic 
party, largest member of the 
coalition, is in. theory commit- 
ted to unarmed neutrality, but 
is content simply to see a con- 
tinued squeeze on defence 
spending. 


Japan's Industrial economy 
continues to bump along the 
bottom of a recession, but gov- 
ernment efforts tp boost pri- 
vate bousing have begun to 
lift household spending, Wil- 
liam Dawkins writes. 

That is the message from 
japan's latest mixed bag of 
statistics yesterday, indicating 
clear signs of recovery have 
yet to emerge. 

Industrial production fell 8.1 
per cent in January, against 
the equivalent month in 1993, 
setting a new record of 28 
months of year-on-year 
declines, the ministry of inter- 
national trade and industry 
said. But output recovered 0.9 
per cent from December's 
level a slight rebound from 
the previous month’s L9 per 
cent decline. Industrial pro- 
duction represents Just under 
a third of economic activity in 
Japan. 

Despite the ind ns trial 
gloom, strong growth contin- 
ued in low-cost housing, 
helped by subsidised govern- 
ment loans and low prices. 
Housing starts rose 20.7 per 
cent in January, from a year 
earlier, the 20th month of 
year-on-year increases, 
the c ons tr u ction m i n is try said. 


Patti Waldmeir tries to fathom why some 

blacks may vote for the National party 


P resident F.W. de Klerk Is 
driven out of coloured 
townships by steams and 
bullets; constitution minister 
Roelf Meyer has goafs bile 
, poured over his head in an 
! African ritual - all part of the 
National party's quest to per- 
suade the victims of apartheid. 
South Africa's non-white vot- 
ers, to support their erstwhile 
oppressors in all-race elections 
in April. 

However immoral or impos- 
sible this may seem to outsid- 
ers, South African politicians 
know that it is a real prospect 
The NP seems assured of sig- 
nificant support in coloured 

and fndifln pnmwiimltiat; arid 

even among black Africans, it 
could partly on" tain the expec- 
ted landslide for the Afr ican 
National Congress. 

The party's biggest campaign 
handicap - apartheid - could 
yet p rov e its gre a t est st reng th . 
For apartheid set out to divide 
South Africa by race and tribe, 
and to breed in blacks a sense 
of inferiority which fosters 
subservience; and It is exactly 
that legacy of racism, ethnicity 
and dependency winch seems 


to motivate non-whites to vote 
NP. . 

Most coloured voters say 
they will vote NP because they 
“do not like blacks”; black NP 
supporters cite tribalism, as a 
reason for opposing the ANC, 
which they data is dominated 
by the Khosa tribe; both say 
they do not believe blacks are 
capable of running a sophisti- 
cated economy. 

Even in modem, urban, eth- 
nically-mixed Soweto, the 
National party can tap a deep 
vein of tribalism. inverted 
racism. Mir David Chuenyane. 
the NFs chief black organiser, 
relies heavily on ethnic scare 
Stories, SUCh as hiS claim that 
ANC officials in the civil ser- 
vice are sacking any public ser- 
vant who is not a Xhosa (even 
though there are no ANC offi- 
cials in top preiftona yet »nri 
no such sackings have been 
reported). 

He doubts the ability of 
hladrg to nm the South Afri- 
can eco n o m y: “The whites are 
the brains behind the econ- 
omy," he says, noting that “the 
blacks (fid provide the labour”. 
He fears affirmative action 


because “I have seen in the 
African states what it has 
dome”, saying Macks are not 
u s**! to handling large sums of 
money and implying that cor- 
ruption will be the inevitable 
result 

Mr Chuenyane candidly 
admits that his relationship 
with the NP is opportunistic: “I 
saw an op po r t uni ty in the NP 
and I said: the NP is stranded, 
they need somebody black.” 
And anyway, he adds, when he 
retumed.fram. decades in exfla 
with the black-supremacist 
Pan Africanist Congress, there 
were no good positions going 
in the ANC. So, he is asked, 
you sold yourself to tire high- 
est bidder? ‘It does look like 
that,” he says, with hardly a 
hint of embarrassment 

My Chuenyane is almost cer- 
tain to be elected as a member 
of parliament given that he is 
seventh on the NP*s election 
list for the region around 
Johannesburg. But his evident 
opportunism - and the shady 
personal history of some other 
black NP nflTiitidatoB , fariniWng 
two notorious “warlords” from 
the western Cape -does little 


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President FWdeBlerit campaigns in sunny mood 


to inspire confidence among 

toe electorate. 

This may matter little. 
Marks are not so much voting 
for tiie NP as against the ANC. 
Thi« fe dear from the numer- 
ous hangers-on at the party's 
unmarked Soweto offices (on 
the floor above the ANC 
office). 

Asked why blacks should 
vote NP, Bocks Mseleku. a 
young NP organiser, tries a 
number of replies: “People join 
for the love of the party”; 
“because the party is open to 
blacks”; “because they have 
changed their logo”. 

He dearies receiving payment 
as an organiser. But all organ- 
isers are paid, he is told. “I 
don't take it like that,” he says, 
adding that he receives R2.000 
(£386) a month, twice his previ- 
ous safely, as “ mrnppngatifln , > 

Apart from paid officials, it 
is hard to find anyone in Sow- 
eto who admits supporting the 

NP. Mr fThtiPnysmp Insists that 

public meetings are held 
almost every weekend and 
house-to-house canvassing is ’ 
constant But when Soweto NP 
information officer Vronda 
ftamfa talcpq a group of journal- 
ists out canvassing, he goes 
only to the home of his . par- 
ents, and to his friend Bodes 
Mashinini, who refuses to 
shalro his hand, and says his 
life is endangered by the visit. 

“The NP is the party of the 
oppressor, It’s the party that 
tortured, you.” says Mr Mashin- 
ini, who Kke Mr Banda was 
once a member of the ANCs 
armed wing, Umkhonta tee 
Six ire (Spear of the Nation). 

So for the party's attempts to 


HK bank 
system 
comes 
under fire 


By Simon Hotberton 
in Hong Kong 


AJEATechnology 


Hong Kong's Consumer 
Council yesterday made a 
stinging attack on the colony’s 
banking system, calling for 
deregulation of interest rates 
and more financial disclosure 
from the banks. 

The council estimated prof- 
its earned by the colony’s 
banking cartel through restric- 
tive practices had grown to 0.8 
par cent of Hong Kong’s GDP 
gross domestic product In 1991 
from 0.3 per cent in 1985, or to 
HK*5.2bn <£452m) from 
HK*L2bn. 

Knee 1964, interest rates for 
small deposits hi Hong Kong 
have been subject to an agree- 
ment between banks. Banks 
were also allowed to under- 
state or overstate their actual 
profits by making secret trans- 
fers (or withdrawals) of profits 
to (or from) “inner reserves”. 

The council said it could 
find, no argument to support 
the old rationale in favour of 
toe cartel, that the Interest 
rate agreement prevented 
cut-throat competition. “The 
banking sector Is now more 
stable and is subject to vigi- 
lant supervision of the Hong 
Kong Monetary Authority.” it 
said. 

The council said Agreement 
covering interest rates on 
deposits below 2HE500.000 
should be phased out by 1997; 
by 1996 banks’ animal and 
interim results shonld be pub- 
lished on a fully disclosed 
basis. At present, only HSBC 
Holdings, parent of Hongkong 
and Shanghai Rank, and Wang 
Seng Bank, a HSBC fisted sub- 
sidiary, produce fully-dis- 
closed financial results. The 
HSBC group of banks reported 
annual results yesterday. 

Since Governor Chris Fatten 
arrived in Hong Kong in 1992 
the colonial government has 
stressed competition In its eco- 
nomic policy. The main author 
of the report. Prof Edward 
Chen of Hong Kong Univer- 
sity, sits on Mr Patten's execu- 
tive conned. 

See Hongkong and Shanghai 
results; Editorial comment 


create a new rum-racial iden- 
tity have elicited either out- 
rage or humour. When the 
long-suffering Mr Meyer went 
to Soweto the weekend before 
last to be “introduced to the 
ancestors'’ it was hard not to 
laugh. 

Comments Weekly Mail col- 
umnist Bafana Kh mnalo : “Oh, 
it’s tough being a New Age 
Nationalist. To make it big 
these days you have to humour 
the natives, whether it’s 
aborting ‘viva’ at their meet- 
ings Or listening to thttm when 
they start their African, gobhle- 


But it is the NP that could 
laugh last Mr Chuenyane says 
6 pex cent would hie a good 
showing in Soweto (where 
there are perhaps L5m voters); 
opinion polls show 1 per cant 
blade support nationwide, but 
political intimidation may ren- 
der them unreliable. 

The NP says it is aiming at 
nurses, teachers, civil servants, 
professionals - people with 
mortgages and a fear of victim- 
isation. But it seems certain 
that much NP support will 
coma instead from the less edu- 
cated, older, more traditional 
residents such as Godfrey 
Mthembu, NP Soweto organ- 
iser “I know I can never be 
over the white man. I know I 
need him, if I break my leg, 
without his medicine I'm crip- 
pled for life.” 

-That was, after afl, the mes- 
sage of apartheid. Indeed, 
South Africa's first all-race poll 
may serve to reveal through 
the support the NP gets among 
blacks, just how successful 
apartheid was. 


Malaysia 
steps up 
curbs 
on Britain 


By Kferan Cooke 
in Kuala Lumpur 


Malaysia stepped up its 
action against British 
business yesterday with the 
announcement that certain 
groups of Malaysian students 
would not now be sent to 
Britain. 

Many thousands of Malay- 
sians study at British universi- 
ties and colleges. 

The Malaysian Trust Coun- 
cil, a government-backed 
agency, said that about 1,000 
students it had intended send- 
ing to Britain would now go 
elsewhere. 

The council would terminate 
a contract with a British com- 
pany which places Malaysian 
students in British universi- 
ties, it added. 

Last Friday, Malaysia 
announced a ban on giving 
government contracts to Brit- 
ish companies in retaliation for 
reports in the British media 
alleging that senior Malaysian 
officials had taken payments 
from British companies which 
had been seeking contracts in 
Malaysia. 

Mr Sulaiman Daud. Malay- 
sian education minister, raid 
Malaysian colleges should end 
twinning arrangements with 
British educational Institu- 
tions. 

“Private colleges which do 
not comply will be risking 
their business,” Mr Sulaiman 
added. 

Concern has been e x p r es s ed, 
by British companies that vir- 
tually all contracts in Malay- . 
sin, whether public or private 
ones, would be affected by toe 
ban. 

Mrs ftafidah Aziz. Malaysian 

ministe r for trade and Indus’ 
try, said yesterday that the. 
move against British compa- 
nies should not be viewed in 
any way as a trade banter or 
sanction. 

“The notion that Malaysia 
had imposed trade sanctions 
a gains t. Britain is not -true at 
all,” the trade and industry 

minister d eclared. 

“It’s merely centred on no 4 
entertaining tenders from Brit* 
ish firms.” 


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FINANCIAL TIMES TUESDAY MA.ri i ,994 


7 

NEWS: INTERNATIONAL __ 


Rao government goes 
for gamble on growth 

Budget runs inflation risk, writes Stefan Wagstyl 


T he government of Mr 
P V Naras imh a Rao. 
India's prime minister, 
yesterday declared its inten- 
tion to gamble on growth. In 
his budget speech. Mr Manmo- 
han Singh, finance minister, 
signalled more strongly than 
before his belief that the econ- 
omy is in good enough shape 
to run the risk of inflation and 
other problems which over- 
eager pursuit of growth might 
bring. 

He acknowledged dangers 
lay along the path he had cho- 
sen. "(But) my considered view 
is that the risks involved in the 
course of action I have pro- 
posed do not cross the limits of 
prudence." The ma i n element 
in Mr Singh's gamble is a deci- 
sion to tolerate higher levels of 
public borrowing than would 
have seemed possible a year 
ago. 

He disclosed that the fiscal 
deficit for the year to end- 
March will probably hit 7.3 per 
cent, far above the target ot 4.7 
per cent For 1994-95, he set a 
target of 6 per cent, again 
indicating: deficit reduction 
would be given only moderate, 
not absolute priority. 

The first to speak publicly on 
these figures after Mr Singh 
had sat down were Mr Prannoy 
Roy and Mr T. Ninan, two 


national TV commentators, 
who both said public borrow- 
ing seemed to be “completely 
out of control". 

Businessmen hailed the bud- 
get for tax and interest rate 
cuts and other measures to 
encourage growth (running at 
an estimated 18 per cent for 
the year to end-March). Mr 
Bansi Dhar, president of the 
Federation of Indian Chambers 
of Commerce and Industry, 
said: "The budget has all the 
ingredients to take India to the 
world's front-ranking nations". 

Mr Singh said in his speech 
that borrowings had grown 
more than expected because 
revenues had fallen short of 
target mainly because industry 
was stagnant Attempts to cut 
the deficit sharply “might well 
have been counter-productive'*. 

The risks of running a large 
deficit were manageable 
because food stocks were high 
and Industry had plenty of sur- 
plus capacity so the danger of 
increased inflation (now run- 
ning at &5 per cent a year) was 
low. 

The main reason why Mr 
Singh has been able to take 
this course Is the country's 
external account performance. 
Because of incentives the gov- 
ernment has given to foreign 
trade and investment since it 


embarked on reform in mid- 
1991, exports are soaring. 

Foreign exchange reserves 
have leapt to a record $l3bn 
(£8.8bn) from $lbn in mid-199L 
India no longer feels the need 
to kow-tow to the International 
Monetary Fund, which granted 
emergency loans in 1991, on 
condition that public borrow- 
ings were cut 

Mr Singh yesterday 
announced that India would 
repay $L4bn early to the IMF, 
a prudent economic move but 
also a potent political gesture. 
For foreign companies, the 
notable points of interest in 
the budget are the decision to 
make the rupee fully convert- 
ible on the current account, 
which should maka non-trade 
transactions easier to process, 
and further reductions in cus- 
toms duties, which should pro- 
mote imports iritn India 

But the budget lacks bold 
deregulatory Initiatives. No 
indication has been given of a 
willingness to reform labour 
laws to increase employers' 
powers to dismiss workers, 
often cited as a disincentive by 
potential investors in India. 

Main items in the budget 
• Maximum customs duty 
rates cut from 85 per cent to 65 
per cent; plus reductions in 
specific categories designed to 


Deficit on the. else again 


Fiscal deficit, . 
as a % of GDP 



Inflation, 

weutf 96 change in CPI . : 

• is e* " 



ynatowmhst ” 

SouKaJMF, kxftngiMMwt . . 


OUrrency reserves. 


10 

a 




, Manmohan Singh 


promote imports of parts and 
raw materials. Duties on steel 
to foil from 75-85 per cent to a 
maxim um 50 per cent 

• Maximum corporate tax 
rate cut from 50 to 40 per cent 
though a 15 per cent surcharge 
stays in place. Taxes on foreign 
companies operating In India 
cut from 65 to 55 per cent. 

• An expenditure (sales) tax 
on hotels cut from 20 to 10 per 
cent to boost tourism. 

• A wide-ranging overhaul of 
indirect taxes, including reduc- 


ing exemptions and special 
cases so that hundreds of rules 
will be scrapped. Indirect taxes 
will be extended to services, 
notably 5 per cent levies on 
phone bills, non-life insurance 
premiums and stockbrokers' 
commissions'. 

• A further Rs57bn (£1.2bn) to 
help recapitalise state-owned 
banks; promises to increase 
spending cm education, health, 
defence, technology and agri- 
culture. 

See World Stock markets 


Grants scheme administration is called ‘deficient’ 

Another Keating minister quits 


Murdoch in 
bid to reverse 
TV award 

By Nikki Taft In Sydney 

Australia’s three main 
television networks, with Tele- 
com and Mr Rupert Murdoch's 
News Corporation filed a court 
action seeking to overturn 
awqrd of satellite licences to 
little-known players. 

The two licences -“A" and 
“B" - were auctioned by the 
federal government last year, 
via a complex bidding process. 
To much surprise, the powerful 
consortium headed by Mr 
Rupert Murdoch, Mr Kerry 
Packer and Telecom lost ont to 
a largely unknown accountant, 
Mr Albert Hadid. 


By NBdd Tait 

Mr Paul Keating’s Labor 
government yesterday suffered 
its third senior minis terial res- 
ignation in as many months, 
when Ms Ros Kelly, who held 
the sports, environment and 
territories portfolio, announced 
she was quitting. 

Ms Kelly has been battling 
allegations she gave preference 
to marginal Labor electorates 
when administering a A$30m 
($2I.5m) sports and cultural 
grants scheme before last 
year’s general election. She has 
maintained no impropriety 
occurred but has been unable 


to produce substantial evi- 
dence explaining how the 
grants were made. 

Sonnter Graham Richardson 
will take over most ot Ms Kel- 
ly’s duties, while retaining his 
health portfolio. The govern- 
ment thus avoids another cabi- 
net reshuffle. Mr Keating will 
resume responsibility for the 
"status of women". 

A parliamentary committee 
yesterday described Ms Kelly’s 
administration of the sports 
and cultural grants scheme as 
“deficient The minister did not 
approach the minimum stan- 
dard in relation to supporting 
her decisions with documented 


reasons," it said, but fell short 
of censuring her. Five opposi- 
tion committee members 
issued a dissenting report, acc- 
using the government mem- 
bers of shortening the inquiry. 

The disKiritmte claimed: “It is 
beyond reasonable doubt that 
(the) programme has been used 
and refined as a part of the 
government's marginal-seat 
election strategy and that the 
grants were used to seek elec- 
toral advantage". They said the 
minister should be censured. 

In December, Mr John Daw- 
kins quit as treasurer, as did 
Mr Alan Griffiths, Industry 
minister, in January. 


Walvis Bay 
transferred 
to Namibia 

South Africa and Namibia 
signed a treaty yesterday 
transferring ownership of the 
port enclave of Walvis Bay, 
aiding what Namibian Presi- 
dent Sam Nqjoma called the 
final chapter of apartheid colo- 
nialism, Reuter reports from 
Walvis Bay, South Africa. 

The treaty gives Namibia 
sovereignty over the enclave, 
which includes the only deep 
water harbour on its coast 

The Namibian flag win be 
raised over the 1,264 sq km 
Atlantic coast territory in a 
midnight ceremony. President 
Nqjoma, said the- transfer was 
long overdue. 


Hebron killings kindle 
anger of Israeli Arabs 

David Horovitz on a threat to co-existence 


M ohammed Abu 
Jamar, a 22-year-old 
bedouin Arab who 
worked as a waiter in a Tel 
Aviv restaurant, got married 
two weeks ago. Yesterday he 
was buried is his home tows of 
Rahat in the southern Negev, 
.the first Israeli Arab to die in 
clashes with the police for 
almost 20 years. 

So for, Abu Jamar is the only 
fatality in four days of running 
street battles between Israeli 
Arabs and police in the after- 
math of Friday's Hebron 
mosque massacre. But dozens 
have been injured and dozens 
more arrested. 

The Palestinian intifa- 
da -the spontaneous uprising 
against Israeli occupation that 
erupted in the Gaza Strip and 
West Bank more than six years 
ago - has spread across the 
international border and into 
Israel itself. And Israel’s politi- 
cal leaders, calling crisis meet- 
ings with leading members of 
the Arab community and 
urging the police to use as 
much restraint as possible, can 
only hope that it will die down 
once time has begun to heal 
the Hebron, wounds. 

From the Knesset podium 
yesterday, Israel's Prime Minis - 
ter Yitzhak Rabin appealed to 
the 800,000 strong Arab com- 
munity - one fifth of the coun- 
try's population - to remember 
their decades of peaceful co- 
existence with the Jews. 

“You are part of us," he 
declared. “You've been with us 
for decades, through thick and 
thin . Loyal partners. We've 
managed to achieved co- 
existence and we want to 

maintain it" 

But as Mr Rabin delivered 
his appeal, many of his target 
audience were otherwise 
engaged. For the fourth 
straight day, m towns and vil- 
lages from Abu Jamar's Rahat 
in the south, to the Galilee in 
the north, hundreds of Arab 
youths were stoning police- 
men, and feeing rubber bullets 
and tear gas in return. 

In Nazareth, Israel’s largest 
Arab town, windows were 
smashed on four Israeli buses. 
Egged, the national bus com- 
pany, was told to divert its 
routes rise where. 


Commission to 
probe mosque 
murders 

As Israel appointed a 
five-member commission to 
investigate Friday's massacre 
at Hebron's Cave of the 
Patriarchs, the Israeli army 
yesterday released an interim 
report acknowledging security 
failures, bnt rejecting Pal- 
estinian claims Israeli soldiers 
contributed to the death toll, 
David Horovitz reports. 

The investigation found Dr 
Baruch Goldstein fired 111 
bullets Into the rows of 
kneeling worshippers. His 
Galil rifle was recovered, and 
all the shells collected inside 
the mosque were found to 
have been fired from it. 

The interim investigation, 
carried ont by the army's 
central command, established 
that five soldiers were on duty 
when Goldstein, a radical 
Jewish settler, slipped into 
the building. Four other 
soldiers supposed to have been 
on duty had over-slept. 

Poor siting of closed-circuit 
TV cameras enabled Goldstein 
to make his way Into the 
mosque, crowded with about 
400 Moslem worshippers, 
without being seen. 

On the basis of this finding, 
Israel’s Prime Minister 
Yitzhak Rabin told the 
Knesset (parliament) 
yesterday that eye-witness 
cl aims of Israeli soldiers 
killing Palestinians inside the 
mosque were “nonsense". 

The army estimated 
Goldstein sprayed bullets for 
60-90 seconds. The senior 
officer on duty said he had 
tried to miter the mosque to 
intervene, bnt found one 
entrance blocked; when he 
reached a second, he was 
pushed back by fleeing 
Palestinians. 


hi Jaffa, the Arab half of Tel 
Aviv where some of the worst 
rioting has been taking place, 
a police promise to release 
dozens of Arabs arrested 
in the past few days 


brought a measure of calm. 

But in Rahat, before Abu 
Jamar’s funeral, a group of 
bedouin protestors, waving 
Palestinian flags, chanted 
anthems familiar from the 
occupied territories: “With fire 
and blood we shall avenge the 
fallen. With fire and blood we 
shall redeem Palestine}." 

Up and down the country, 
local Arab leaders appealed to 
the police to clear out, to 
enable them to calm the 
inflamed populace. "There is a 
deep crisis in Arab-Jewish rela- 
tions," said Nazareth teacher 
Ali Zaydan. “I don't know who 
can join them back together." 

Many analysts have been 
ascribing the ferocious and 
unexpected outpouring of Arab 
rage to the increasing popular- 
ity of the Israeli Arab Islamic 
Movement, which proresses to 
work peacefully for the 
advancement of Israeli Arabs, 
but is regarded with deep sus- 
picion by most Israeli lenders. 

Some Israeli Jews, though, 
have acknowledged a deeper 
cause: the discrimination still 
routinely suffered by Arab citi- 
zens, the minimal government 
funding for their local coun- 
cils. the poorer education sys- 
tem, the higher unemployment 
rates. 

If Israel wants to avoid its 
Arabs rioting again in the 
future, said Dr Alexander Blei, 
a former prime ministerial 
adviser on Arab affairs, "the 
government must introduce 
policies to bring hill equality 
for Israeli Arabs". 

But perhaps the most funda- 
mental problem is that Israeli 
Arabs know that Jews, to a 
greater or lesser extent, still 
doubt their loyalty, still do not 
really regard them as “proper 
Israelis". 

In an interview after the 
Israeli-PLO accord was signed 
at the White House last Sep- 
tember, the Israeli Arab poet 
Samih al-Qasem spoke of how 
Israeli Arabs have felt in the 
past “as if we were a fifth col- 
umn. A time bomb. A demo- 
graphic danger” So the peace 
accord, he said, had come as a 
profound relief, a signal that 
Israeli Arabs could now “truly 
integrate". Sadly, it seems, hie 
may have spoken too soon. 



Degussa and environmental protection 


While others were 
exploring the sky, 
we were exploring 
ways to keep it clean. 


Degussa developed the 
world’s first air pollution 
control, over one hundred 
years ago. Based on a 
method of eliminating the 
sulphuric adds from flue 
gases emitted by smelters 
and factories, this system 
also resulted in what was 
probably the world's 
first-ever pollution control 
patent in 1882 . 


But that was just the 
beginning for Degussa. 

It was followed tv further 
developments designed to 
protect our environment 
Our catalytic converter for 
car exhausts is just one 
recent example. And our 


On land, water and in 
the air, Degussa is a world 
pioneer in pollution control. 

Rr Degussa. it all began 
with gold and silver. HxJay 
we shine In many more fields. 


DeDIOX process for purifying 
incineration plant emissions 
is another. 


ctSX* S0LUr '°Afc 
A 0 

/ 

Degussa 


Phot. BM. nt. Parts 



8 


FINANCIAL TIMES TUESDAY MARCH I 1994 


)l 


NEWS: UK 


Money supply 
figures raise 
recovery hopes 


face up to a life above ground 



Ten years on, Alan Cmnmtngs from Easington Colliery is still bitter, seeing the strike as a political vendetta 


By Philip Coggan, 

Economics Correspondent 

A sharp rise in the purchasing 
managers' index and newly 
published money supply fig- 
ures point to the continuing 
health of the UK recovery after 
a raft or sluggish economic sta- 
tistics in recent weeks. 

The news should cheer Ur 
Kenneth Clarke, the chancel- 
lor. as he prepares for tomor- 
row's monthly monetary meet- 
ing with Mr Eddie George, 
governor of the Bank of 
England. 

Figures released by the Bank 
yesterday show that MO. the 
narrowest measure of the 
money supply, grew by a sea- 
sonally adjusted 03 per cent in 
February, for an annual rate of 
5.5 per cent, up from 53 per 
cent in January. The rise 
was ahead of market expect- 
ations. 

This jump was partly caused 
by a sharp rise in the erratic 
component of MO. banks' 
deposits at the Bank of 
England. Notes and coins, the 
main component of MO, grew 
by a more modest 0.5 per cent 
in February (also seasonally 
adjusted!, for a 12 month, 
growth rate of 5.6 per cent, 
down from 5.7 per cent in Jan- 
uary 1 . 

The government's monitor- 
ing range for MO is 0 per cent 
to 4 per cent, but the measure 
has been outside this band for 
some time. MO's annualised 
rate of growth over the three 
months to February* was 9.3 
per cent. However, the govern- 


ment has argued that East MO 
growth has been caused by the 
fall in interest rates. 

The opportunity cost of hold- 
ing cash - instead of putting It 
in the bank and earning inter- 
est - has fallen and therefore 
people's willingness to hold 
cash has risen. In technical jar- 
gon, the velocity of money has 
fallen (it circulates less 
quickly). 

Mr Simon Briscoe, UK econo- 
mist at S.G. Warburg Securi- 
ties, said that, adjusted for the 
Treasury's measure of velocity, 
MO was within its monitoring 
range. Previous interest rate 
cuts occurred, he said, when 
MO was within Us adjusted 
monitoring range. 

The Purchasing Managers 
Index, released today, indicates 
a significant increase of activ- 
ity in February. The index, 
compiled by the Chartered 
Institute of Purchasing and 
Supply, rose to 553 per cent in 
February, its highest level 
since last ApriL 

The index is based on a 
weighted survey of variables, 
such as measures of output 
and new orders. Any level 
above 50 per cent represents an 
increase over the previous 
month. January's index, which 
was 49.1, pointed to a new-year 
lull in activity. 

The institute said that out- 
put and new orders were par- 
ticularly strong in February, 
reflecting “a general improve- 
ment in economic conditions 
throughout all regions and 
manufacturing sectors during 
the month". 


Miners 

David Goodhart 

meets some union 
officers who had 
furthest to fall 

T en years ago today 
George Hayes, the 
National Coal Board’s 
area director for Smith York- 
shire, announced the closure of 
Cortonwood colliery, triggering 
one of the largest, and proba- 
bly the last, great national 
strike in British industrial his- 
tory: the 1984-1985 miners 
strike. 

Since the strike, the number 
of miners has fallen from 
196,000 to about 14,000 with 
political and industrial conse- 
quences which have been well 
charted. 

But what has happened to 
the local ofGcials of the 
National Union of Minework- 
ers? Those men - usually artic- 
ulate and self-confident - were 
at the core or the political and 
social networks within mining 
communities and formed a 
unique labour movement elite. 

As the pits have closed it is 
those men who have bad fur- 
thest to fall, losing not only a 
well-paid job but social status. 
Many now struggle to earn a 
living as security guards, 
school caretakers, or taxi- 
drivers and look back nostalgi- 
cally on the days when they 
were managing the working 
lives of hundreds of people. 

Few have changed their 
views about the strike. Mr 
Alan Cummings. 46, a senior 
official at Easington colliery in 
Durham, still sees the strike as 
a political vendetta and still 
feels bitter about the lack of 
support from the rest of the 
labour movement While oth- 
ers, such as Mr Carl Browning, 
lodge secretary at Celynen 


South in South Wales, always 
blamed Mr Arthur ScargUl the 
miners’ leader, for mishandling 
the dispute - and «*ni does. 

Mr Cummings’ pit only 
closed last year, since when he 
has been winding up union 
business and is set to join the 
dole queue next month. He 
does not expect to be able to 
exploit his experience of man- 
aging people or even to find a 
job on the Feteriee industrial 
estate - dominated by the 
wives of former miners. 
Instead he is t hinking of 
returning to college. 

A follow official at Easing- 
ton. Mr John MacManey, has 


found a job doing unskilled 
work in a local factory packing 
batteries. What he finds hard- 
est of all to take is the dose 
supervision. “Down a mine you 
have to be able to trust people 
to get on with the job, but in 
factories they treat you like a 
moron,’’ Ik says. 

Another Sharlston official, 
Mr John Swithenbank, has, 
like many former miners, 
found employment as a secu- 
rity guard, on about half the 
pay he received as a miner. He 
works for the Reliance security 
company doing 12 hour shifts - 
three days on days, three on 
nights, then three days off. 


Mr Jim Heel, former NUM 
treasurer at Celynen South, is 
one of a number of min- 
ers to have survived as a small 
businessman. His wife’s hard- 
ware retail business has been 
expanded since the pit dosed 
and they run three shops. 

Most former NUM officials 
say that they have to play 
down their former union wort: 
when seeking new jobs. But 
sometimes they take their 
strong union traditions into 
their new jobs. One such is Mr 
Frank Clarke, former secretary 
at South BOrkby colliery, who 
got a job at the Morrison 
supermarket in Wakefield and 


blew some new life Into the 
local Transport and General 
Workers Union branch. 

“They did recognise the 
union at Morrison’s but there 
were no reps and nothing 
much aftpmpri to happen", he 
says. He has also created a 
Wakefield branch of the TGWU 
with 750 members where 
before there was nothing. 

But it has not been easy for 
Mr Clarke. As an NUM official 
he was on full-time union busi- 
ness. As a TGWU rep at Morri- 
son's he has to do all union 
work in his spare time after 
working a 50 hour week for a 
little more than £150 a week. 


NBC in 
moves on 
new TV 
channel 

By Raymond Snoddy 

NBC, the US television 
network, is expressing serious 
it i iw n d In applying to run a 
new national Channel 5 in the 
UK. The US company could not 
by law control such a venture, 
but is starting to look around 
for potential UK partners, 
fiwhwHwg national newspaper 
groups. 

NBC has been planning to 
expand into the European 
market for some time and last 
year bought control of Super 
Channel, the pan-European 
satellite television channel. 

NBC executives believe they 
could bring a new programme 
dimension to fihannel 5, which 
three quarters of the UK popu- 
lation could receive. 

Last week the Independent 
Television Commission said it 
considered there was a strong 
case for re-advertuing the sin- 
gle national licence for Chan- 
nel 5. The Commission 
warned, however, that before 
taking a final decision it 
needed confirmation from the 
Government that the neces- 
sary frequencies would remain 
available. The issue is whether 
a conventional analog Channel 
5 would be incompatible with 
developing digital terrestrial 
television in the UK. 

As the ITC continues to 
develop a transmission plan 
for C hanne l 5, the Government 
has decided to use the interval 
“to take stock" on Channel 5 
and the present state of digital 
television. It Is likely to be 
two or three months before a 
Government decision - consid- 
erably longer than the ITC 
would have liked. The Depart- 
ment of Trade and Industry is 
believed to be particularly 
interested in prospects for dig- 
ital television. 

The possible Involvement of 
NBC means there should be 
competition if a Channel 5 
licence is advertised. 

List month MAI, the televi- 
sion and financial services 
group. Time Warner, the US 
media giant, and Pearson, 
owner of the Financial Times, 
said they had formed a consor- 
tium to bid for the Channel 5 
I licence If one is advertised. 


Scots salmon producers angry at Norwegian ‘dumping’ 


By James Buxton, 

Scottish Correspondent 

Scottish salmon producers have 
stepped up their action against Nor- 
way by making a formal complaint 
to the European Commission alleg- 
ing that the Norwegian salmon 
industry has been dumping its Osh 
an the European Union market. 

The complaint comes five months 


after European salmon, prices col- 
lapsed following an unexpected 
upsurge in output by Norway, the 
dominant European producer. 

Scottish salmon farmers claim 
Norway's higher production is made 
possible only by heavy government 
subsidies and financial support for 
the banking system which lends to 
the farmers. It wants the European 
Commission to investigate its claim 


that Norwegian farmers are s elling 
fish below the cost of production, 
and if this dumping nlahn is sus- 
tained take action against Norway. 

That could entail imposing coun- 
tervailing Import duties, or asking 
Norway to bring supply and demand 
into balance, by taking fish off the 
EU market 

To support its claim of dumping 
the Scottish Salmon Growers Associ- 


ation commissioned a report from, 
the accountants Ernst & Young 
which showed that Norway's high 
level of salmon production at low 
prices could not have been achieved 
without direct grants and subsidies 
to producers Amounting to 20 per 
cent of the cost of production over 
the past five years. 

It said the losses made by the Nor- 
wegian industry over the past five 


years had mostly been absorbed by 
the four major banks, which since 
1991 have come under the control of 
the government. 

Mainly because of a surge in Nor- 
way’s salmon production, helped by 
breakthroughs in treatment of dis- 
ease. salmon prices in the EU col- 
lapsed last October, hi November the 
EU imposed a minimum import price 
on salmon which was increased last 


month to £2.74 per kg. to recent days 
salmon prices have strengthened to 
nearly £3 per kg. 

Norway produced 180,000 tonnes of 
salmon in 1993 compared 140.000 
tonnes in 1992, while Scotland’s out- 
put rose from 38,000 tonnes to 48,700 
tonnes, of which 3,500 tonnes were 
unsaleable because of pollution from 
the Braer tanker sinking in Shet- 
land. 




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Prime Minister of the Republic of Poland 

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Narodowy Bank of Polski 

Mr Wieslaw Kaczmarek 

Minister for Privatisation of the 
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Mr Ian Hume 

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Dr Eberhard von Koerber 

ABB Asea Brown Boveri Ltd 

The Rt Hon Sir Michael 
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FINANCIAL TIMES TUESDAY MARCH 1 1994 


NEWS: UK 


Unionist blow to progress on Ulster talks 


Britain in brief 




By David Owen, Philip Stephens 
and Tim Coone 

Attempts by the British and Irish 
governments to forge a durable settle- 
ment in Northern Ireland were dealt a 
serious Wow yesterday when the 
Jlster Unionists, the province's larg- 
est political paily. :~oieu jul u return 
to round-table talks with Dublin and 
other constitutional parties. 

Mr James Molyneaux, the UUP 
leader, said multi-party talks undei 
ihe old formula of nothing being 
agreed until everything was agreed 
were ‘a recipe for disaster and faiJ- 


ure- ' But he said the party was pre- 
pared to continue with bilateral dis- 
cussions co-ordinated by Northern 
Ireland minister Mr Mieharf Ancxam- 

The party’s stance was immediately 
condemned by Mr Albert Reynolds, 
the Irish prime minister, who said 
any attempt to reach an internal set- 
tlement in Northers Ireland was 
“unacceptable". 

Mr John Major also reaffirmed ins 
support for the three-stranded 
approach, covering relations within 
the province, between the province 
and Dublin, and between London and 
Dublin. 


The prime minister, who last night 
held talks on Northern Ireland with 
president Bill Clinton, stressed 
Britain was anxious to draw a line 
under its dispute with Washington 
over the visit to the US of Sinn FSin 
president Mr Gerry Adams. 

Launching new UUP proposals for 
devolved government in Ulster, Mr 
Molyneaux attacked Sir Patrick May- 
hew, the Northern Ireland secretary, 
for “to some extent torpedoing” the 
Ancram talks process by sending a 
checklist of ideas on the path to a 
settlement to DubUn. 

Calling for the introduction of 


internment as part of an imm ediate 
clampdown on terrorism, he warned 
Mr John Major that the UUP*s special 
relationship with the Conservative 
party would be jeopardised if the gov- 
ernment was not prepared to press on 
with restoring accountable democracy 
to the province. 

The centrepiece of yesterday’s pro- 
posals was a call for an 85-member 
Ulster assembly, elected by propor- 
tional representation. 

On relations with Dublin, the party 
said only that its ambition would be 
to “develop cooperation on matters of 
mutual interest and concern." 


In talks with US congressmen Mr 
Major emphasised that last Decem- 
ber’s joint declaration was not 
designed simply to provide a "Quick 
fix” in the province. It would remain 
on the table to provide the foundation 
for an eventual permanent settle- 
ment. 

It is understood that the prime min- 
ister believes that the purely internal 
assembly sought by Mr Molyneaux 
would be vetoed by Mr John Hume's 
mainly Catholic Social Democratic 
and Labour party, which in turn 
would wreck the prospects of a dura- 
ble settlement 


Government to 

review public 
sector contracts 


By David Owen 
and Roland Rudd 

Private companies will be able 
to win public sector contracts 
without having to compete 
against other bidders, under 
new British government guide- 
lines to be nnveiled today. 

Mr Stephen Dorrell, financial 
secretary to the Treasury, will 
announce that ministers have 
decided to drop their insistence 
on competition in all cases, in 
a effort to get the govern- 
ment’s private finance initia- 
tive off the ground. 

Under the new guidelines, 
where a contract cannot pro- 
ceed without access to the 
intellectual property of the 
company that came up with 
the proposal, it will not be put 
out to public tender. 

The move, recommended by 
the government's private 
finance working party, is 
designed to address what has 
emerged as a significant obsta- 
cle to the involvement of pri- 
vate capital in public sector 
projects. 

Companies have been unwill- 
ing to commit resources to 
devising new proposals since, 
once adopted, they are 
required to go to competitive 
tender for implementation 
allowing the innovation to be 
won by a competitor. 

Addressing an Institute of 
Directors seminar. Mr Dorrell 
will set out a framework for 


Heseltine raps legal advice on Iraq 


ha n d li ng competition in pri- 
vate finance initiative con- 
tracts. 

He is expected to confirm 
that government departments 
will be permitted to offer the 
partial reimburs ement of ten- 
dering costs if they set out the 
arrangements under which 
this would take place before 
the tendering process starts. 

Companies represented on 
the government's private 
finance working group have 
also been assured that when 
contracts are put out to com- 
petitive tendering the competi- 
tion will only be between three 
or four big companies. This is 
designed to cut down on the 
bureaucracy and involved 
in the tendering process. 

Government departments 
will also clearly define public 
sector contracts in order to 
avoid what one member of the 
committee railed "the chop- 
ping and changing of govern- 
ment construction contracts”. 

A string of conditions is 
expected to apply to the cases 
where the competition require- 
ment is dropped. The proposals 
will not involve cases covered 
by European Union rules 
requiring competition. 

Mr Dorrell’s speech comes a 
week after a Labour paper on 
private financing for infra- 
structure projects and he is 
expected to argue that there is 
cross-party consensus on the 
benefits of private finance. 


By Jimmy Bums 

The opposition Labour party 
yesterday called for the resig- 
nation of Sr Nicholas Lyell, 
Britain's attorney-general, 
after Mr Michael Heseltine, the 
trade and industry secretary, 
publicly questioned the legal 
advice given to ministers In 
the Matrix Churchill case. 

In evidence to the Scott 
exports-to-Iraq inquiry, Mr 
Heseltine said that he had been 
offered contradictory advice by 
Sir Nicholas on whether he 
should sign public interest 
immunity (PH) certificates pre- 
venting disclosure of Whitehall 
documents. 

Last mght Sir Nicholas said 
his advice on PU “has 
remained consistent”. He is 
planning to give evidence to 
the Scott inquiry in three 
weeks time. 

Earlier Mr Heseltine told tho 
Scott inquiry that he had 
signed a PII certificate 
extremely reluctantly, only 
after being advised by Sir 
Nicholas that it was his duty 
to do so. He bad also been reas- 
sured that his concerns would 
be conveyed to the judge. 

But following the collapse of 
the Matrix Churchill trial, Mr 
Heseltine received further 
advice from Sir Nicholas that 
he was not duty-bound to sign 
a PH in cases wh ere revealing 

dnrrrmgnta " migh t he essential 

to ensure a fair trial". 

Mr Heseltine said he found 
the apparent contradiction 
‘‘incredible” given the strong 
reservations he had had about 
not making docum ents avail- 
able to the defence in the 
Matrix Churchill case. 

During the Matrix Churchill 
trial, counsel for the prosecu- 


tion, Mr Alan Moses QC, made 
no reference to Mr Heseltine’s 
worries and argued that the 
documents were not relevant 

to the defence. 

Mr Heseltine said he was in 
principle in favour of the need 
for confidentiality to preserve 
the efficient working relation- 
ship between officials and min- 
isters and also to protect the 
intelligence services. 

But 1 m had refused to sign a 
PU certificate in the Matrix 
Churchill case after a dose 
examination of the documents 
involved. 

The documents showed links 
between the intelligence ser- 
vices and Matrix Churchill 
executives, and official 
approval of the export to Iraq 
of machine tools known to he 
of military use. The prosecu- 
tion said the businessmen had 
lied to the government, and 
that the documents were not 
relevant to the defence even 
though they showed the execu- 
tives exporting defence-related 
equipment with full govern- 
ment knowledge. 

Mr Heseltine said: “It 
became apparent to me that if 
these series of events were 
known at any stage, I would 
have to become engaged in a 
process of non-communication. 
This I was not prepared to do.” 

He signed the PU certificate 
only after insisting that it was 
phrased in such a way as to 
protect him from any future 
allegation of a cover-up. 

Mr Robin Cook, Labour 
shadow trade and industry sec- 
retary, said last night "It is 
hard to see how the attorney- 
general can now survive, ffis 
role appears to have been to 
protect the government rather 
than the course of justice.” 



Michael Heseltine arrives to give evidence to the Scott 
exports-to-Iraq inquiry yesterday Raw* Tmwr hwvMm 




Record fine 
for insurance 
company 

A widespread and systematic 
failure to comply with regula- 
tory requirements yesterday 
cost Legal & General, one of 
the UK's leading life and gen- 
eral insurance companies, a 
total of £400.000, including a 
record fine. 

Lantro, the self- regulatory 
organisation for the UK life 
insurance industry, ordered 
L&G to pay a fine of £180,000 
as well as the £220,000 costs of 
Its investigation. 

The charges, which were 
admitted by L&G. focus on its 
failure to keep proper control 
of its direct sales agents. They 
highlight in particular the 
way in which compliance 
responsibilities were delegated 
to branch management and 
staff without enough central 
control. 

L&G said yesterday that it 
remained committed to the 
philosophy behind its system 
- that compliance had to be an 
integral part of the sales pro- 
cess and so was a matter for 
every sales agent - but had 
introduced central checking of 
all customer information 
acquired by its sales force. 

Mercury wins 
court hearing 

Mercury, the UK telecommuni- 
cations company, yesterday 
won the preliminary court 
hearing of its action against 
BT. its principal competitor. 
and Oftel, the telecommunica- 
tions regulator. It is the first 
legal action to be pursued 
against a regulator of the for- 
mer state utilities. 

Mercury had claimed that 
Oftel had not offered it reason- 
able terms for the carriage of 
its traffic by BT, through a 
consistent misinterpretation of 
BTs government licence. 

Mercury’s victory yesterday 
Tnaaru; there will be a full hear- 
ing of its application for a legal 
interpretation of that part of 
the licence which deal with 
interconnection. 


Tory split on 
Europe reopens 

The difficulties toeing Conser- 
vative party leaders in produc- 
ing a unifying manifesto for 
the Enro-eJec lions in June 
were farther underlined by 
renewed demands from Euro- 
sceptics yesterday. 

In a debate on the enlarge- 
ment of the European Union 
they again urged the renegoti- 
ation of the Maastricht treaty. 

Mr Bill Cash. Conservative 
MP for Stafford and the most 
persistent critic of the Maas- 
tricht treaty, said it was “per- 
fectly apparent" that it was 
not working and he suggested 
that the Treaty of Rome, on 
which the original European 
Community was founded, j!m 
needed to be renegotiated. 

Calor to offer 
natural gas 

Calor Gas, the dominant sup- 
plier of bottled liquefied petro- 
leum gas in the UK, has 
decided to enter the competi- 
tive natural gas market 

Mr Howard Robinson, chief 
executive, said Calor Gas is to 
offer supplies immediately to 
consumers using more *iiur. 

2.500 therms a year, with par- 
ticular emphasis on small com 
merrial users. 

Calor’a new business will be 
supplied by Alliance Gas. the 
joint venture of British Petro- 
leum, Statoii and Norsk Hydro 
of Norway. Alliance claims to 
have 10 per cent of the firm 
market for gas users above 

2.500 therms. Calov says It 
might attract 5 per cent to 10 
per cent of the 300,000 or so 
potential customers in the 
small commercial category. 

Baby milk ad 
plan attacked 

UK manufacturers of infant 
formula yesterday attacked 
government proposals to bac 
all consumer advertising of 
baby milk as a "scandal" 
which would result in tougher 
laws than currently apply to 
tobacco. 

The government plans to 
have regulations in place by 
June. Health officials want to 
see an increase in breastfeed- 
ing, which is considered better 
for infants than formula milk. 
The rule changes also follow 
on from a European Union 
directive on infant formula. 


G * ? 
s f n 
i t s S 

*• ft a &■ 


— . * n 


Invitation Of Proposals 
For Development And Operation 
Of A Satellite Communications 
System For Pakistan 


2. Government of Pakistan invites interested parties, 
singly or in consortium, both of Pakistan and 
foreign origin, to design, procure, develop, launch, 
manage, operate and market a co mmuni cation 
satellite system including a back-up satellite, in the 
private sector for Pakistan with no fi n an cial obliga- 
tion to the Government of Pakistan. The bidder will 
carry out its own financial and tech n ical feasibility. 

2. The Government will make available allocated 

orbital s lotto) at 38° E and /or 41° E for a specified 
period for the location of an operational and back- 
up satellite. The Government of Pakistan, however 
shall reserve the right to use these orbital slots for 
co-location of its own satellite as and when 
required. The right to use the slot (s) by the bidder 

will be for a period of IS years after which it may be 
considered for renewal on mutually agreed terms 
gmd conditions. 

3. The successful bidder shall directly offer far hire or 
sale space segment capacity (Satellite transpon- 
ders) to authorized entities in Pakistan or elsewhere 
for Television and Radio (networking and 
broadcasting). Telephone. Telefax and Data 
Transmission Services etc. The sale/lease of 
Satellite transponders to foreign entities shall be 
subject to the standard regulatory provisions of the 
Government of Pakistan. 

4. The bidder shall establish the ground control fadili- 

ty including the tracking, telemetry and telecom- 
mand (TT&C) station in Pakistan for controlling the 
satellite (s) from Pakistan. 

5. The bidder shall be obliged to deploy the satellite 
system on the basis of sharing of technology and 

know-how with the designated local entity/entities 
and assist in their manpower development. The 
bidder shall be required to: 

(a) Provide participation of Pakistani personnel 
in the satellite integration, testing, launch 
readiness and operations. 

(b) Maximize Pakistani participation in the 
development, installation and maintenance ot 
software for 


i) Satellite operations and control 

ii) Network monitoring and control 

(c) associate Pakistani entities in cons truction, 
installation, testing and commissioning oi 
TT&C and satellite earth 

stations. 

(d) preferably, locally produce in Pakistan in 
collaboration or under license all possible 
subsystems, for which detailed working plan 
will be submitted by the bidder. 

& The bidder shall be required to pay royalty and 
license fee to the Government of Pakistan for oper- 
ating the system. The bid amount in United States 
Dollars together with mode of payment in this 
respect shall be indicated by the bidder. 

7. Project completion period and implementation 
schedule shrill be submitted by the bidder. 

8. The bidder shall provide details of previous 
experience in development, implementation, oper- 
ation <rnd management of a satellite communica- 
tion system. 

9. The bidder shall provide evidence of financial 
soundness for undertaking a project of this size. 

10. The successful bidder shall incorporate a company 
in Pakistan which will own and operate the 
satellite communication System. 

11. For any clarifications and information the 
prospective bidders may contact the undersigned. 

12. Seeded bids should be submitted by 
10th April, 1994. 


Joint Secretary-H 
Government of Pakistan 
Ministry of Communications 
Block 'D'.PakSectL 
Islama bad. 

Tab 823738 Fax: 825454 



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10 


FINANCIAL TIMES TUESDAY MARCH I 1994 



EUROPE 


Animal spirits on 
too tight a leash 


W hen Euro- 
peans discuss 
industrial per- 
formance, 
most of the 
talk is about manufacturing 
and little about services. Yet as 
the challenge of economic 
regeneration grows more press- 
ing, services’ contribution and 
potential look set to move 
sharply up the agenda. 

The sector is already 
Europe’s largest source of out- 
put and employment - and its 
importance is increasing. In 
west Germany, Europe's lead- 
ing manufacturing economy, 
the number of services jobs 
rose 23 per cent from 1990 to 
1992, while totals in other sec- 
tors stagnated or declined. 

The outlook is for a continu- 
ing feD in factory jobs and a 
squeeze on public sector pay- 
rolls throughout Europe, leav- 
ing services as one of few areas 
where large-scale job creation 
stfll seems possible. 

Opthnists point to the US, 
where services employment 
has grown by 23m people since 
1980 - double the rise in the 
EU - and to the growth of 
Britain's service economy. 
Though the quality of jobs cre- 
ated is disputed, these exam- 
ples are cited as arguments far 
relaxing continental Europe’s 
rigid labour laws. 

But the story does not end 
there. The search for new jobs 
coincides awkwardly with 
structural upheavals in ser- 
vices businesses such as tele- 
communications, the media, 
financial services and retailing. 

These businesses ought to be 
at the heart of wealth creation, 
as Europe upgrades from 
declining traditional industries 
to newer, technology-based 
activities involving higher 
skills and greater value-added. 
But, in many, pressures to 
improve efficiency are likely to 
the short term to lead to fewer 
jobs, not more. 

A report last month for the 
European Commission found 
airlines’ operating costs were 
48 per cent higher in Europe 


Services in Europe are 
less attuned to a mass 
market than in the US, 
says Guy de Jonquieres 


than in the US, largely because 
of poorer labour productivity. 
A McKInsey study In 1992 
fo und s imilar tr anaatlanfin ipm- 

ductivity differences in tele- 
communications H hanging 

More recently, McKmsey 
found the efficiency of British 
retailers, supposedly among 
Europe’s highest, trailed far 
behind US chains- It concluded 
that, if UK supermarkets had 
to charge US prices, they 
would plunge into loss. 

While most service busi- 
nesses were labour-intensive 
and sheltered by national har- 
riers, such discrepancies mat- 
tered little. But the discrepan- 
cies are becoming 
unsustainable as cross-border 
competition and labour-saving 
technologies compel companies 
to raise productivity. 

The pace is being forced by 
privatisation, which is chal- 
lenging the over-staffing, 
bureaucracy and obsolete prac- 
tices encouraged by a tradition 
of state ownership in sectors 
such as telecommunications, 
airlines and banking. To judge 
by job cuts by privatised UK 
companies, the scope for 
labour-shedding across Europe 
in the next few years is huge. 

If services are to generate 
economically rewarding addi- 
tional jobs, tackling rigid 
labour laws will not be enough. 
Much will also depend on 
Europe's ability to maximise 
markat opportunities and stim- 
ulate service-based businesses 
with the potential to grow fast 
and profitably. 

On this score, services in 
Europe are bound by two con- 
straints which impose more 
heavily than on manufactur- 
ing. One is domination of 
important markets by national 


monopolies. The other is a 
more complex - and often 
more restrictive - panoply of 
regulatory controL 
The impact of the EITs sin- 
gle market programme on 
these obstacles has been 
uneven. Progress to dismantl- 
ing barriers and encouraging 
cross-border competition has 
been reasonably rapid in a 
range of financial, professional 
and business services and road 
transport, bat more baiting in 
classic monopoly industries, 
such as telecommunications, 
energy supply and air trans- 
port Nor does the programme 
tackle some inhibiting natinnaT 
regulations, such as Germany's 
tight curbs on shopping hours. 

But it is debatable how far 
fragmentation of Europe's ser- 
vices markets has, in practice, 
obstructed their development. 
Though many barriers to mar- 
ket entry have been real, oth- 
ers seem to owe much to par- 
ticipants’ attitudes. 

A mong the most per- 
suasive evidence is 
trans-European 
expansion by US 
services producers. 
While Europe’s broadcasters 
and film makers dabble with 
collaboration, Hollywood enter- 
tainment dominates its 
screens. The US-owned MTV 
music channel, now beamed 
Europe-wide, has pioneered an 
entirely new market 
US and 

cable operators have been 
more aggressive than most 
local counterparts to establish- 
ing footholds in Europe, while 
the running in “multi-media” 
services, such as home shop- 
ping, is mostly by US firms. 
Most packaged software used 


on personal computers to 
Europe is of US origin, while 
Japanese groups dominate 
electronic video 

Chains such as Toys R Us 
and ComputerLand have revo- 
lutionised sectors of European 
retailing, while McDonald’s is 
now France's biggest restaura- 
teur and has earmarked west- 
ern Europe as its prune growth 
market to the 1990s. 

US companies obviously ben- 
efit from scale economies from 
a large and homogenous home 
market But to most cases, 
they also succeed to Europe by 
offering distinctive products, 
backed by effective marketing 
and distribution 

European services compa- 
nies such as Ikea or Benetton 
to retailing, which have made 
an impact in North America by 
transplanting a new idea, are 
more rare. More often the pre- 
ferred route is to buy market 
share by investing in estab- 
lished businesses. 

Though this approach is sup- 
posed to reduce risk, the 
results have been mixed. 
Grand Metropolitan has revi- 
talised Burger King, but Bass 
is still struggling to turn 
around Holiday inn. Marks & 
Spencer now admits it paid too 
much for Brocks Brothers, the 
US clothing chain, while sev- 
eral European grocery groups 
which bought into US super- 
markets have been troubled by 
Urn experience. 

Of course, US service compa- 
nies are far from infalHhla, as 
the Eurodisney fiasco demon- 
strates. But, at their best, they 
often seem more closely 
attuned than European busi- 
nesses to the mam market and 
more confident about export- 
ing innovations. 

That suggests that, if 
Europe’s services industries 
are to prosper, ridding markets 
ctf artificial barriers and exces- 
sive regulation is only half the 
battle. The bigger challenge 
may be to unleash the animal 
spirits needed to exploit them 
fully against steadily stiff er 
international competition. 


COMPETE? 

Service industries 


Services importance grows worldwide 
as job creation outstrips manufacturing. 


g en tles 


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...but patterns in Europe vary by country... 


Poufttago 



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Maine addad in vendee* T V 



; GoromunicBftoas. 


...while retailing becomes more international 



A growing taste for shopping around 


Retailing 


By Nell Buckley 

S ingle market enthusiasts 
have long maintained 
that retailing has a spe- 
cial role to play to cementing 
the unity of the new Europe - 
and not just because of the sec- 
tor's role as distributor of man- 
ufactured goods. It employs 
about 17 per cent of the EU’s 
workforce, and retail sales 
account for between 16.6 per 
cent of gross domestic product 
(in Belgium) and 35 per cent of 
GDP (in Greece). 

Yet retailing remains one of 
the least international indus- 
tries, with many leading retail- 
ers operating largely within 
their home markets. There are 
fears that Europe's failure to 


develop powerful, truly inter- 
national f-b»iTiR means It will 
soon be overrun by new 
entrants from the US. 

The fragmented nature of 
the European market results 
partly from cultural, language 
and taste differences. But 
restrictive legislation has also 
hindered domestic and cross- 
border expansion. 

Laws such as France’s Lot 
Roger, Belgium's Loi Codettas. 
and Germany’s Baunutzungs- 
verordmmff limit retail devel- 
opments above certain sizes, to 
the Nether l ands, the number of 
stores in any area Is limited 
according to population size. 
Those restrictions have not 
been removed by the single 
market and, in some cases, dif- 
ferences are widening. 

But It would be wrong to 
suggest that cross-border 


expansion In Europe is not tak- 
ing place. Between early 1991 
and early 1993, the Oxford 
Institute of Retail Management 
found European retailers bad 
made 530 international moves, 
nearly three-quarters of them 
expansions into other Euro- 
pean countries. But restrictive 
legislatio n and market satura- 
tion at home have also spurred 
retailers to look at north Amer- 
ica. 

France’s Promod&s, Ger- 
many's Aldi and Tfengelmann, 
Belgium’s DeEbaize, and Ahold 
of the Netherlands all at 
least 20 per cent of their turn- 
over outside their home mar- 
kets. But chains from across 
the Atlantic are also eyeing 
opportunities provided by a 
market of 320m west European 
consumers - and are well- 
equipped to exploit them. 


Unimpeded by national bound- 
aries, planning restrictions, 
high l and costs, and wars at 
home, some US retailers have 
been building up their 
operations for a century or 
more. 

The result is the world's 
largest, most vibrant retail 
market At $2400bn in 1992. it 
was larger than the GDP of 
united Germany. Their size 
gives US retailers enormous 
buying power, while the com- 
petitiveness of the market, 
plus the fact that experimental 
stores can be launched easily 
and cheaply, has made the US 
the crucible of retailing inno- 
vation. The US invented mafl. 
order, the self-service super- 
market and TV shopping. 

US retailing also has a high- 
ly-developed discount sector, 
and has pioneered discount for- 


mats such as warehouse dubs, 
“category kfllera” such as Toys 
R Us and factory shop malls, 
which could pose a significant 
threat to higher-margin Euro- 
pean, and especially UK. retail- 
ers. A recent report by retail 
research group Corporate Intel- 
ligence suggested more than 50 
UB retail groups were queueing 
up to enter Europe, inducting 
the world's largest, Wal-Mart 

There is, moreover, an 
important difference between 
US and European retail expan- 
sion overseas. US retailers tend 
to export their own format and 
grow organically. Groups such 
as Toys R Us and restaurant 
chain McDonald’s have 
brought innovative formulas to 
Europe and transformed every 
market they have entered. 

One reason may be that fam- 
ily ownership of retailers 


makes it difficult to buy into 
the French, German and Dutch 
markets. But US retailers may 
in any case be more adept at 
exploiting gaps in the market 
While some European retail- 
ers- such as Ikea, the Swedish 
furniture superstore chain, 
Carrefour. the French food 
retailer, and srnaiw formats, 
such as Benetton, Body Shop 
and Laura Ashley - have 
extensive overseas networks of 
their own stores, most Euro- 
pean retailers have preferred 
to expand abroad through 
acquisitions. But they have not 
always proved adept at trans- 
ferring management skills to 
acquisitions, as shown by the 
roll call of European camper 
niat, such as Marks Marks and 
Spencer, Ddhaize and Dixons, 
that have barf trouble in Hw» 
US to recent years. 


Quest for a strategy 
to match Hollywood 


The media 


By Raymond Snoddy 


T hose struggling to create 
a strong European 
audio-visual industry 
face an uncomfortable fact: 
across Europe, audiences still 
Often prefer the entertainment 
offered 1^ Hollywood. 

Even to France, where para- 
noia about US “cultural imperi- 
alism" seems rampant, con- 
sumers continue to vote with 
their feet at the box office. 
Although the most popular 
film in France last year was 
ha Visiteurs, a satire, it was 
one of only two French films to 
reach the top 10. In Its first 11 
weeks, Steven Spielberg's 
Jurassic Parle sold L23m tick- 
ets in the Paris region alone. 

The US industry's domi- 
nance is based on the econo- 
mies that Dow from its scale of 
production and the fact that 
costs can be recouped in the 
domestic market before being 
exported. By comparison, 
Europe is fragmented by lan- 
guage. tradition and differing 
attitudes to commercial broad- 
casting. Many European coun- 
tries have only recently devel- 
oped commercial channels 


alongside alder public service 
broadcasters. In the past 
decade, for Instance, the num- 
ber of commercial television 
channels to Europe has risen 
from only four to more than 60 
- though the number Is likely 
to grow with the launch of 
channels financed by advertis- 
ing to eastern Europe. 

In some major European 
markets, commercial produc- 
tion skills are still not fully 
developed. Mr Manfred Lahrt- 
steln, president of the elec- 
tronic media division of 
Bertelsmann, the German 
media group, says the German 
television Industry still finds 
the production disciplines 
needed to turn out 30 minutes 
of a soap opera every day diffi- 
cult. “The advantage of the 
Anglo-Saxon world is that they 
had private television so much 
earlier than the continental 
Europeans,” he says. 

Even so, German television 
has been changed profoundly 
by private broadcasters such 
as RTL, in which Bertelsmann 
has a 39 per cent stake. After 
10 years to existence, RTL has 
finally taken a lead to the rat- 
ings over both AKD and ZDF, 
the main German public net- 
works. Yet many of the big 
commercial broadcasters such 


as TFl, France’s privatised 
first channel, CLT of Luxem- 
bourg and Silvio Berlusconi’s 
Finlnvest remain net importers 
of programmes from the US. 

Moreover, individual mar- 
kets are at different stages of 
development in the new media. 

Cable and satellite, are well-es- 
tablished in the UK and Ger- 
many but hardly at all in Italy. 
The pan-European market is 
still to Its Infancy, although a 
growing number of satellite 
channels are broadcasting to a 
continental market 

Varying strategies are being 
pursued by European govern- 
ments and media groups to 
compete more effectively with 
the Americans. Several govern- 
ments, such as France and the 
UK, are moving to reduce bar- 
riers preventing broadcasting 
organisations becoming larger. 

It is, however, hard to see 
this process producing more 
European media groups on a 
world scale. There have been 
no television or film equiva- 
lents so far of the merger of 
Reed International and Elsev- 
ier to the publishing and infor- 
mation business. 

Additional reporting by 
Quentin Peel in Bonn, Alice 
Smostkom m Paris and Robert 
Graham in Rome. 


Regional expertise 
in niche markets 


Business services 


By Hugo Dixon 


B usiness services such as 
telecommunications, air 
transport and accoun- 
tancy are not only large sec- 
tors In their own right their 
performance also strongly 
influences the success of the 
economy as a whole. 

Unfortunately, Europe’s per- 
formance In many business 
services leaves much to be 
desired. Compared to the US, 
productivity is often poor, 
markets are shrivelled and 
services are expensive. 

A services study by 
McKiusey, the management 
consultants, in 1992 con- 
cluded: “US industries gener- 
ally continue to show a higher 
tevel of productivity than their 
European counterparts." As a 
result, Europe does not have 
as large a presence as the US 
in what are often high val- 
ue-added businesses, and other 
industries reliant on business 
services suffer from high casts 
and poor quality. 

Bat the picture is not all 
gloom. Europe, notably the 
UK, does quite well in accoun- 
tancy, law and management 


consultancy. Britain’s leading 
law firms are the main com- 
petitors for US firms in the 
growing market for interna- 
tional legal services. Hie “Big 
Six" global accountancy firms 
still have strong UK roots. 

An important explanation is 
that London's highly devel- 
oped financial markets have 
proved demanding customers 
for accountants and Interna- 
tional lawyers. Not only has 
this meant a high standard 
has been required of them but 
it has also enabled them to 
win business abroad by hang- 
ing on to financiers’ coat-tails. 

Europe usually does well to 
business services needing a 
high degree of customisation 
as opposed to mass-market 
solutions. A history of frag- 
mentation seems to have given 
the region’s businessmen an 
expertise in niche markets. 

For example, Europe’s com- 
puter services industry per- 
forms well in designing 
“bespoke” software - tai- 
lor-made solutions for individ- 
ual companies. By contrast, 
the market for “packaged soft- 
ware" is dominated by the US. 
It supplied 78 per cent of the 
world market to 1991, with 
European production account- 
ing for only 16 per cent 


Europe’s tradition of monop- 
oly and state-ownership has 
contributed to its lack of dyua- 
nrian in sectors such as tele- 
communications and air trans- 
port Fragmentation of these 
industries on national lines 
has also prevented the devel- 
opment of high-quality cross- 
border networks. 

The consequences in tele- 
communications are quite 
high prices for basic phone 
services, especially cross-bor- 
der calls. There has also bran 
a low take-up of more 
advanced products, such as 
freephone services, while 
Europe is behind to developing 
“electronic superhighways" 

which could revolutionise dis- 
tribution arrangements for 
many industries. 

la airlines, the picture is 
similar. A recent report for the 
European Commission showed 
Europe suffers Crum quite high 
airline operating costs and 
antiquated air traffic control 
systems. High fares and 
delayed flights not only barm 
business travellers and under- 
mine development of a stogie 
market; they also undermine 
the competitive advantage of 
the EITs travel and tourism 
industries, which employ 19m 
people. 


Cleaning up 

continental 

competitors 


W ith much of its work 
done in the hours of 
darkness, the 
cleaning business occupies a 
twilight zone of the service 
industry. Yet providing spar- 
kling wttvin nnTQflnls for offices, 
hospitals and industrial prem- 
ises can offer Europe-wide 
growth opportunities compara- 
ble to those to much lngher- 
profile sectors. 

ESS, the Danish cleaning 
group which is the world's 
leader in this field, has built up 
a European network of high- 
quality cleanera. Mr Waldemar 
Schmidt, the 53-year-old man- 
aging director of IBS’s Euro- 
pean operations, responsible 
for turnover of £330m a year, 
says: “If other people can have 
pan-European businesses, we 
asked ourselves, ‘Why 
shouldn't this apply to 
cleaning?”' 

Cleaning is traditionally a 
fragmented, regional business, 
given scant attention by cus- 
tomers. By offering high stan- 
dards and encouraging compa- 
nies to take a cost-conscious 
look at their dawning hiTfc, ISS 
claims it can. lower overheads 
and promote efficiency. 

ISS prides itself on higher 
wages and better training than 
most competitors, “Gleaning is 
generally thought of as a job 
nobody wants to do," says Mr 
Tbeo Dilissen, manag in g direc- 
tor of Belgian operations. “We 
offer incentives and tr aining 
courses so people can upgrade. 
Our workforce is our product. 

We're helping oxn- customers to 
become competitive.” 

IBS’s customers range from 
multinationals, such as IBM, 
Philips and Monsanto, to the 
European Commission, Vienna 
and Genova airports and the * 
British Rail subsidiary running 
the north London marntenarirw 
depot for Channel tunnel 
trains. 

Cleaning budgets can be sur- 
prisingly large. The annual 
c leanin g costs of Asea Brown 
Boveti, the international engi- 
neering group, exceed $7&m. “if 
you have an in-house cleaning 
team, it’s not part of the core 
business," says Mr S chmid* 
The key to better productivity, 



he says, is to bring in quality- 
consdous outsiders, sometimes 
combining claiming with other 
duties. 

Under a recent contract with 
Slovenian railways, ISS fe to 
have 300 cleaners on the coun- 
try’s trains and stations, down, 
from 600 previously. In "an 
awnnal contract With Brit- 
ish Airports Authority, 130 SS 
cleaners work to three shifts at 
Heathrow’s Terminal One. 
They are encouraged not 
merely to sweep floors but also 
to give directions to travellers. 

ISS is developing additional 
services for its hospital cus- 
tomers, such as catering, por-. 
taring, technical maintenance 
and equipment supply. 

With 130,000 employees in 20 
countries, ISS is present to 
every main European country 
apart from France and Italy. 
Its share of the deaning mar- 
ket is between 20 and 40 per 
cent in Scandinavia (where it 
is the market leader), 6 pur 
cent In the UK (whore it is tfo 
3) and 2 per cent to Germany 
(No 8X • r 

Mr Schmidt says expansion, 
is customer-driven. He esti- 
mates annual growth, rates (» 
the "contracted out” cleaning 
market at 5 per cent to Ai?K 
tria, Switzerland, Germany and 
Prance, 7 per cent in the UR 
and 10 per ceait in Belgium and 
Greece. If ISS is right, skss 
and more companies will B® 
coming round to the vfe w-Bn* 
cleanliness and competitive- 
ness belong together. 





FINANCIAL TIMES TUESDAY MARCH I ,994 


11 


BUSINESS AND THE LAW 



EUROPEAN 

COURT 


Decision 
and fine 


The Court of First 
Instance has a p >ii > 
shown its teeth by 
annulling part of a 
European Commis- 
sion competition 
decision and sub- 
stantially reducing 

—7 a fine imposed on 

one of the applicants. 

The Commission decision con- 
cerned tiie Hels inki agreement - 
an agreement between certain 
French, finan c i a l institutions aw* 
the Eurocheque organisation - 
which provided that traders affili- 
ated to the Carte BJeue and/or 
Eurocard networks would accept 
foreign Eurocheques on the ^ 
terms imposed for payments by 
Carte Bleue and/or Eurocard 
cards. 

Under the agreement, the 
French financial institutions 
agreed they would charge traders 
which were affiliated to the rele- 
vant networks a commission for 
purchases paid for by Eurocheque. 
The level of commission would be 
no greater than that applicable to 
purchases paid for by GB, Visa or 
Eurocard/Mastercard. 

The Commission said the agree- 
ment infringed the EC competi- 
tion rules and imposed fines of 
Eculm and Ecu5m an the Euro- 
cheque organisation and on the 
French financial institutions 
group respectively. The parties 
sought annulment of the decision 

or annulment of the fines. 

The Eurocheque organisation’s 
case turned on a procedural issue 
relating to the rights of defence. 
Just before the Commission sent 
out its statement of objections, 
setting out its preliminary find- 
ings on the Helsinki agreement, 
the French financial institutions 
group notified the agreement to 
the Commission. 

In the li gh t of this notification, 
the Commission addressed a sup- 
plementary statement of objec- 
tions to the French financial insti- 
tutions group, but not to the 
Eurocheque organisation on the 
grounds that Eurocheque had not 
notified the agreement A. copy of 
the document was sent to Euro- 
cheque for information. 

Eurocheque claimed the failure 
to address the supplementary 
statement of objections to It 
breached its rights of defence, in 
that certain new objections were 
raised in the supplementary 
document which it had not been 
able to answer. • • • 


annulled 

reduced 


The Court said that under the 
procedural rules governing such 
matters, it was the Commission's 
duty to address statements of 
objections to ail interested parties, 
and that it could only retain in its 
final decisions those objections 
which the parties had bad an 
opportunity to artrfress- 

The Court wW the supplemen- 
tary statement of abjections had 
modified the intrinsic nature of 
the objections raised against 
Eurocheque. It also said the Com- 
mission should not send to one 
party a cow of a statement of 
objections to another. 

As a result of its fmrim ge, the 
Court annulled that part of the 
Commission’s decision relating to 
Eurocheque, including the fine. 

The French finan cial institu- 
tions raised several points. The 
first was that the Commission 
decision had failed to establish the 
e x istenc e of a price-fixing agree- 
ment. The Commission hart taken 
the position in its decision that, 
not only did the Helsinki agree- 
ment set out rules for the charg- 
ing of commission on certain 
Eurocheque transactions, but that 
it also regulated the amnimt of 
such charges. The Commission 
based this latter conclusion on 
certain provisions in the Helsinki 
agreement 

But the Court said, although the 
Commission had been righ t to find 
that there had been an agreement 
to charge commission on certain 
Eurocheque transactions, it had 
been wrong to find that there has 
been an agreement on the amount 

of ra wnnissi n n 

Tim Court said the different pro- 
visions of the Helsinki agreement, 
which had been read together by 
the Commission in support of its 
finding m fact related to two dif- 
ferent types of transaction. 

Given that the bams on which 
the Commission reached its find- 
ing was wrong, the finding itself 
was invalid. Even though the 
French group’s other arguments 
were unsuccessful, the ffn«> shimM 
be reduced accordingly. The Court 
said the fine should be cut from 
EcuSm to EcuZm. 

Joined Cases T-39J92 and 40/92- 
Groupement des cartes bancatrcs 
“CB” and Europay international 
SA (formerly Eurocheque Iniemor 
tional) v Commission. CFI ICE, 
February 23 1994. 

BRICK COURT CHAMBERS, 

- BRUSSELS 


A taxing task 
for partners 

Robert Rice explains how to cope 
with the move to self-assessment 



/■ M SEMCRFfWNEfc* 

GBOFFf&Y'STHE UUN/oR PARTNER. 

AND THAT'S THE Tftfc-ftSEesSJNS WRTNS*. 


T he 1994 Finance Bill con- 
tains what accountants 
Coopers & Lybrand calls 
"the most wide-ranging 
reforms of personal tax and compli- 
ance this century". The introduc- 
tion of self-assessment for the 
self-employed and the changeover 
from taxation on a preceding-year 
basis to a current-year basis from 
the 1997-98 tax year, with a transi- 
tional year in 199&97. will affect Sm 
people in the UK. 

Among those most affected will 
he partnerships- For partnerships in 
exigence on April S this year, tax- 
able profits arising in any year of 
assessment after April 5 1997 will be 
calculated as though the firm were 
an individual, and then divided 
among the partners in the same 
way actual profits are shared In the 
period in which they arise. 

Partners will be required to 
include their share of the taxable 
profits in their own personal tax 
returns for 1987-98 and calculate or 
“self-assess" the tax due on their 
total income and capital gaiw Rarh 
partner wifi be responsible far pay- 
ment of his or her own tax. Tax 
returns must be filed with the 
Inland Revenue by January 31 in 
the year following the year of 

aiawMipant 

Payments on account - tax paid 
before the final amount has been 
agreed with the Inland Revenue — 
will be due in two instalments, the 
first on January 31 in the year of 
assessment and the second on July 
31. Interim payments will normally 
be based on the preceding year's tax 
liability. Final balancing payments, 
like the tax return, must be made 
by January 31 in the year following 

swswwnmt 

Thus a firm with an accounting 
period ending on June 30 1998 will 
pay tax in the financial year 1998-99 
(the tax year in which its account- 
ing period ends), and partners will 
have to maira intorfm payments on 
January 31 and July 31 1999 and 
file completed returns and make 
balancing payments by January 31 
2000 . 

To encourage compliance and 
prompt payment, tax paid 28 days 
late, ie on February 28. will attract 
a 5 per emit surcharge and, if it is 
still outstanding six months later, 
another 5 per cant 
Although the new regime treats 
partners as sole traders, making 
each of thpm responsible for his or 
her share of the profits, partner- 
ships will still submit returns of 
adjusted p ro fi ts and the allocation 
of them among the partners to the 
Revenue. Negotiations on the prof- 
its win also still he bandied cen- 
trally with the partnership. 

To encourage compliance, late 
partnership returns will also attract 
an automatic penalty of £100 per 
partner and a similar penalty if 
still outstanding six months later. 
There are similar penalties for 


late personal returns. 

For partnerships in existence cm 
April 5 this year, 1998-97 will be a 
transitional year. Under the transi- 
tional provisions, tax paid in 1996-97 
will be a 12 months’ average of the 
tax payable on the profits arising in 
the two years to April 5 1996. 

Thus for a partnership with a 
year end of April 30, the relevant 
accounts on which tax will be 
assessed for the transitional year 
1986-97 will be for the periods May l 
1994 to April 30 1995, and May 11996 
to April 30 1996. Tax will be payable 
an 12/24ths, or half, of those results. 

According to Denise CatteraD, a 
tax partner of Coopers & Lybrand, 
this creates a significant, one-off 
tax-planning opportunity for part- 
nerships. 

If a firm is anticipating any large 
or unusual items of income. It 
should try to ensure payment is 
madt» during the transitional assess- 
ment period, as it will effectively be 
halved for tax-averaging purposes. 
Equally, large one-off items of 
expenditure, such as refurbishment 
or redundancy costs, should be kept 
out of the assessment period, 
because a firm will effectively get 
tax relief on only half- 

With May 1 not far away, firms 


should be planning now to take 
advantage of the transitional 
regime, either bringing forward 
exceptional items of expenditure or 
delaying receipt of exceptional 
income, she says. 

But there is one caveat The Reve- 
nue has said it will introduce a nar- 
rowly targeted anti-avoidance provi- 
sion, details of which may not 
emerge until next year, so caution 
is required. 

M rs Catterall believes 
that, provided firms 
stick to what can be 
classified as ordinary 
commercial decisions, the Revenue 
will find it hard to object The trick, 
she says, will be to avoid anything 
that, ig too obviously designed to 
ra sh in an the transitional regime. 

The gamp, is also true of partner- 
ship borrowings. If a firm has part- 
nerehip borrowings and is likely to 
pay an unusual amount of loan 
interest in the transitional period, it 
will effectively only receive tax 
relief on half, if, an the other hand, 
the borrowings are rearranged so 
that they are expressed as loans to 
each partner individually, th en fall 
tax relief on the interest will be 
available to partners as individuals. 


Again, the Revenue may target 
this as an avoidance measure, but 
Mrs Catterall believes it should be 
possible for firms to argue a com- 
mercial justification for rearranging 
their finances. 

The start of the transitional 
period is not far off, so it is vital 
that pa rtner ships clear their arrears 
with the Revenue if they are to 
avoid problems in finalising their 
first partnership and personal 
returns under the new system. For 
firms with a finanriwl year ending 
March 31. the problem is acute: 
once the new regime is in place, 
they will only have until the follow- 
ing January 31 to file their returns 
and pay their tav 

Ten months is a short time for 
even the most efficient partnership 
to sort out its tax system. If a firm 
is years behind in its tax affairs, as 
many partnerships are, any tax 
return filed within such a tight 
timescale will inevitably contain 
estimates. 

With a period of only 12 months 
after the statutory filing in which 
amendments ^ be made, partner- 
ships may lose out if they do not 
take steps quickly to ensure their 
tax affaire are up-to-date, to elimi- 
nate excessive reliance on esti- 
mated figures. 

Within certain limits, partner- 
ships win be able to change their 
finanpiai year end, and the diffi- 
culty of filing returns within 10 
months may be one reason for mov- 
ing the year end to a date after 
April 5 . An April 30 year end would 
give the firm considerably longer to 
file returns and statements of prof- 
its. But against that must be bal- 
anced the effect of paying tax on 
“overlap profits” - profits taxed in 
successive years for firms with year 
eraiiMHng the fis c al year - 
and, in particular, the impact of this 
on retiring and new partners. 

Whatever the effect of the new 
rules on individual partnerships, 
the change to a current-year basis 
of taxation win accelerate the pay- 
ment of tax. making tax provision 
more difficult - particularly in 
times of faHing profits. 

Whereas a tax bill amassed and 
waiting to be paid could be used as 
working capital under the old 
regime, under the new rules that 
“fund” will no longer be available, 
says Mrs CatteraD. 

She believes most partnerships 
wfll continue to provide for tax, but 
the acceleration of the payment of 
tax may mean they will have to find 
other means of raising working cap- 
ital. Partners may be asked to con- 
tribute more, or the deficit may be 
marip up by h illing eartipr and chas- 
ing up payment 

These ehangas in personal taxa- 
tion will have a si gnificant impact 
on all lawyers, architects, surveyors 
anfi other partnerships. For those 
who have not yet taken proper 
advice, time is running out 


LEGAL BRIEFS 



Battle over drugs 
patent set for 
House of Lords 


T he battle between two 

pharmaceuticals companies 
over whether metabolites 
produced by the body in response 
to drugs can be patented is set to 
go to the House of Lords. This 
follows the UK Appeal Court's 
rejection of the claim by Merrell 
Dow Pharmaceuticals, of the US, 
of an infringement of its patent 
in the metabolite of terfenadine, 
an anti-histamine. 

MerreU’s original patent in 
terfenadine had expired, bnt the 
company claimed that, by selling 
tablets containing the drug, Norton 
Healthcare of the UK was providing 
the means for infringement of its 
subsequent patent in the 
terfenadine metabolite, produced 
when terfenadine is taken. The 
Court said that, if Merrell's 
argument was accepted, then “if 
they discovered that inside some 
organ of the human body aspirin 
invariably produces a hitherto 
unsuspected compound, they could 
patent the compound and thereby 
preclude anybody selling aspirin 1 '. 

The Court said Merrell's patent 
covering the terfenadine metabolite 
should be revoked or amended so 
it did not apply to the metabolite 
when produced by the human body. 

The case is being watched by 
producers of generic drugs, which 
fear big companies will use similar 
measures to prevent the sale of 
generic products. 

Courtly cantatas 

U K Lord Chief Justice, Lord 
Taylor, created a stir last 
year by appearing on BBC 
Television's flagship current affairs 
talk show. Question Time. But even 
he cannot match the efforts of two 
US counterparts. Supreme Court 
Justices Ruth Bader Ginsburg and 
Antonin ScaDa, who last month 
donned wigs and gowns of a more 
theatrical kind to appear in the 
Washington Opera's opening 
performance of Richard Strauss’s 
Ariadne auf Naxos. 


PEOPLE 


Thinker rather than doer’ needed at Fenner 


Fenner, the Hull-based 
industrial group, is hoping to 
appoint a chief executive by 
the end of April, filling the gap 
left by Julian Bigden, who 
returned to the US in Decem- 
ber after less than a year as 
managing director. 

The appointment of a chief 
executive will be an important 
step for Fenner after a year of 
senior management changes. 
Bigden had been appointed 
managing director in February 
last year by Peter Barker, the 
former executive chairman, 
and replaced Tom Brown who 
resigned unexpectedly. 

But in May last year Barker 


himself announced his retire- 
ment. Colin Cooke was 
appointed nan-executive chair- 
man in June and Bigden has 
now returned to his previous 
job running Fenner's highly- 
successful US polymers opera- 
tion - a responsibility which 
he had retained when be 
moved to the UK. 

His departure was said by 
Cooke to be “very amicable'’, 
although it is understood that 
Cooke was much happier with 
Bigden as a business manager 
than as a managing director. 

Cooke, who is also executive 
chairman at Triplex Lloyd, 
says Fenner has three candi- 


dates in mind for the job of 
chief executive. 

He is looking for a “thinker 
rather than a doer" as chief 
executive, to provide strategic 
leadership without interfering 
with the three main divisional 
heads as they try to exploit 
growth opportunities. 

Fenner is now being run on 
a day-to-day basis by Mark 
Abrahams, finance director, 
and Michael Howell, a director 
of Arlington Capital Manage- 
ment who joined Fenner’s 
hoard in November. 

A big challenge for the new 
chief executive will be to 
resolve the future of Fenner’s 


largest business, power trans- 
mission, which lost £L8m in 
the year ended September 30 
and was largely responsible for 
a fall in overall pre-tax profits 
from £lL3m to £9.6m. 

Talks on a possible sale of 
the division broke down in 
December, and Fenner is now 
concentrating on improving 
the unit’s profitability. 

This would make it more 
attractive to another pur- 
chaser. 

However, it remains a rela- 
tively low-margin operation 
and lacks the growth potential 
of Fenner's other specialist 
pngpnpfring businesses. 


Avon Rubber 


plumps for 
Willcox 



his way through the ranks at 
Avon Rubber from clerk to 
chief executive, is to bow out 
this December at the age of 60 

after more than 40 years at the 

tyre and motor components 

company. J . .. 

He will be replaced by the 
head of Avon's industrial poly- 
mers division, Stephen Will- 
cox. 47. The succession was 


decided after months of delib- 
eration by a board torn 
between the Willcox and the 
finance director, John Harper. 

In the end, Willcox, who 
joined Avon as a graduate 
trainee in 1968 and only left 
briefly for a stint at Miles Lab- 
oratories. won the race by a 
nose. While the appointment 
was welcomed in the City, 
some suggest the new regime 
would face greater pressure to 
perform. “We do not mind who 
is running it as long as he does 
better than has been done in 
the past.” says one analyst. 
“There has been a regular 
deferment of profits growth . . . 
and as a result a degree of 
impatience about the perfor- 
mance.” 

Mitcbard, whose outgoing 
style contrasts sharply with 
the quieter approach of W1E- 
cox, is widely credited with 
having transformed Avon from 
a sleepy UK industrial group. 
However, the group's purchase 
of Cadillac Rubber and Plastics 
in the US in X9S6 took longer 
than expected to bring bene- 
fits, partly because of recession 
but because of dependence on 
a few automobile manufactur- 
ers. 


’Financial Services Regulation - 
Its Place in the Legal Maze” 

Chancery Bar Association SpriacL^ureuTnbe^ven to 

„ Uise. Chnirtnan of the Semantics nnd 
l unMondny 7 Marth « ** Great Hall, Lincoln a Inn. WC2. 

Bar Association welcomes to this public fect»> 1 

■ *£ aniss s 

unnnc law on this important topic. Mr Largo ^ 

.1" Stoaa. insolvency, will*, wwrnio. nnd intellectual property. 



Peter Duffy (above) has been 
appointed managing director of 
BP Energy, the British Petro- 
leum division which operates 
industrial power plants on 
behalf of clients. 

Duffy, an industrial chemist 
by training, has spent the past 
13 years with BP. He was most 
recently responsible for the 
industrial and public sector 
fuels business. 

BP’s energy division has 
grown rapidly in recent years, 
with turnover climbing from 


£7m in 1900 to £2Sm last year. 
The industry has been boosted 
by the trend among industrial 
companies of contracting out 
those activities not seen as 
critical to their core 
operations. 

■ David Veraon-Smitfc. 
formerly head of human 
resources, has been appointed 

to the board as director, 

corporate affairs, at MANWEB. 

■ Cbris Btherington is 
promoted to director of 
management services at 
UNICHEM and Tony Foreman 
to director of sales and 
marketing of the wholesaling 
division; Bill Bart, who will 
retire later this year, beco m es 
commercial director. 

■ Geoffrey Faulkner has been 
appointed md of P&S 
FDtratioai, part of SCAPA 
GROUP. 

■ Dale Scfamnaker, chief 
executive of Appleton Papers, 
the US subsidiary, has been 
appointed to the board of 
ARJO WIGGINS APPLETON. 


Barnett moves to Y&R. 


Although the vaunted 
marriage between advertising 
agencies Gold Greenlees Trott 
and Young & Rubi cam's Lon- 
don outpost has collapsed at 
the altar. Bernard Barnett has 
decided to join the latter. 

Barnett, elder statesman of 
London’s advertising trade 
press, is relinquishing his job 
at Campaign magazine and 
joining Y&R in a capacity yet 
to be determined. 

Now 51, Barnett has done 
three stints at Campaign. Pro- 
duction editor from 1968-72, 
editor 197&34, and editorial 
director since 1991, he’s also 
that rare bird, a practitioner of 


what he preaches; he worked 
for the Abbott Mead Vickers 
and Ogilvy & Mather agencies 
between 1984-9L 

But given that London’s 
advertising world is buzzing 
with gloom and doom about 
Y&R London - managing 
director Hm Lindsay and chief 
executive Jerry Judge jumped 
ship just before Christmas - 
why has Barnett selected Y&R 
for his latest return foray? 

Y&R T/mrinn “is not ill as 
good shape as it used to be”, 
admits Barnett, but adds 
“there is an irresistible chal- 
lenge in rebuilding a great 
brand.” 


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to enter informal discussions now, even if d isposal is not envisaged for 
some years. 

Please contact Steven Hopkins on 0384 460084 for further details. 


MARKET RESEARCH COMPANY WANTED 

Marketing strategy consultancy with blue-chip clients seeks to 
purchase a market research company ideally based in the South 
East 

The company will have a turnover of under £1 million pa and 
have a proven track record of quality work and client satisfaction. 
Please send details of the company, in confidence, to: Box B2734, 
Financial Times. One Southwark Bridge, London SEl 9HL. 


BUILDING BUSINESS 
WANTED 

London- based Construction and 
Development PLC seeks small 
works bidding businesses in the 
North East London and South west 
London areas for acqulsiuon or 
merger. 

The businesses must be well 
esabllshed wth good Ctem bases, 
hsarestsd prindpais should apply to: 
Wkfletx Bn B2675, FkandalTnus, 
OnoScUhwafk Bridge. London SEl 9HL 


LEGAL NOTICE 


umxATmor 
ASMAUSOVKES* 
MANAGEMENT UNITED 
AjBnraxAitttQvrwjBsumcr 
Krtaun» 

BHrUStrffcM- 


OWNEDC AR 
FLEETS WANTED 

Established contract hire 
company wishes to acquire 
company owned car fleets 
(fleet ^zes upwards of GO to 
L000 vehicles). Through a Sale 
and Lease Baek release capital, 
and so create an instant 
cash fund to improve your 
liquidity and cashflow. 

ttepUcs in encurt raafidmoe. Principal* 
only. Write Bo> B2T10, Ftaaneml Tunes. 
Ore S a reJ n ra rit Bnd gR . Lo nitm 3Et 8HL 


>•!*>> 


iiru b usnr am ponm b Me mm 

m a. <« ff fchrar nw isnroMH 

Sitoeioim.neaiMiMMi>| 

Ecwtiim i n 1 1 i UpjinJetemlmte 

tf ** tad n>— n. | 

II II I II i mi 

miCHtoteto 



MggeBscaaS 

MtettiauSiiaiMtfsilHei 


be 12 iprt I 9 H » a - 

a e* wre ■r rewjgs ito 


taalteirfb. 

raw 
WB 


Recruitment 

Consultants 

Based South of England 
Prestigious high-tech client base 
Turnover £L5M+ 

Seeks mergo/acquisition as 
a way of benefiting from 
new market opportunities. 

Write u Bat 82712, Fimscnl Times. 
Ooc Southwark Bridge. 

London SEl »HL 




12 



FINANCIAL TIMES TUESDAY MARCH 1 1994 


MANAGEMENT 



— In a — 

Nutshell 


going to court to dear then- 
name, ff tl »7 wan file case, costs 
would normally be awarded 

agafairf iViF Twlimd Bwmi» amd 
would include costs for preparing 
the case. 


W hen Lord Strathclyde 
first took his seat at 
the Palace of Westmin- 
ster at the age of 26, 
police inside would not believe he 
was a noble lord. 

Eight years on, and now minister 
for small businesses at the depart- 
ment of trade and industry, Lard 

Strathclyde has lost none of his boy- 
ish looks and AnDimHaiwn Hia age 
was initially some concern to the 
vociferous small-business lobby. 
With only six years' work experi- 
ence at insurance company Bain 
Clarkson, what could he know of 
small business' concerns, some 
asked. 

He was. furthermore, following a 
procession of ministers who had 
passed through, the department 
with such speed that it seemed gov- 
ernment support for small busi- 
nesses was little more than rheto- 
ric. But Lord Strathclyde has 
prompted pleasant surprise in the 
six months since he replaced Baron- 
ess Denton. Where she was ulti- 
mately criticised for not modifying 
her strong opinions, Lord Strath- 
clyde has impressed audiences with 
his open mind and an ability to pick 
up complex briefs. 

However, the direction in which 
he seems to be leaning has not been 
so widely welcomed. There is 
guarded optimism among people 
who want government increasingly 
to focus its small-business support 
services on the few businesses that 
have a real chance of growing, 
creating jobs and wealth. Those 
who want support services to be 
spread more thinly among a greater 
number of smaller businesses are 
less pleased. 

A careful politician. Lord Strath- 
clyde does not dismiss the value of 
what are often called “lifestyle busi- 
nesses”, companies which have lit 
tie prospect of growing and creating 


Data Protection 
dodgers face fines 


Companies seek 
more help 


l Small companies believe the UK 
government should be playing 
a greater role in helping them 
gain access to finance, according 
to a survey of 750 companies 
carried out by the British 
Chambers of Commerce. 

About 80 per cent thought the 
government could provide more 
help. It could help to create low, 
fixed rate and longer-term 
borrowing for small companies. 

It could also reduce “red tape”, 
particularly that involved in 
applying for finance muter the 
Loan Guarantee Scheme, which 
is now available op to £250,000 
and can be as part of 
packages of finance that include 
bank debt 

British Chambers of Commerce. 

Tel 071 7992196. 


Companies that have failed to 
register under the 1984 Data 
Protection Act risk fines of at 
I least £5,000. 

While 182,000 organisations 
have registered, some 150.000 
computer users have yet to do 
so, according to the national 
audit office. 

Under the act, any organisation 
that keeps details about living 
people on computer - even just 
names and addresses - must 
register their use of the 
information. 

The Data Protection Register 
is to launch a campaign to 
encourage compliance. Failure 
to register is a criminal offence 
and can lead to Ones of £5,000 
in the lower courts and unlimited 
fines in higher courts. 

Registrar’s Information Service. 

Tel 0625 535777. 


Government urged 
to produce report 


Intrastat system 
criticised 


Sir Michael Grylls MP, chairm an 
of the Conservative backbench 
committee on trade and industry, 
has been persuaded to withdraw 
a private members’ bill calling 
for the government to produce 
an annual report on smaller 
companies. But the government 
is still likely to produce some 
form of report Lord Strathclyde, 
small business' minister, says 
he is keen to have such a report 


Businesses seek 
compensation fund 


i Should companies investigated, 
but cleared, by the Inland 
Revenue, receive compensation 
for their costs? 

Companies in this situation 
are calling for a central fund to 
help alleviate what can be a 

damag in g experience for smaller 

companies. During an 
investigation, they are often 
required to produce large 
numbers of historic statements, 
for which banks charge. 

Even if there is no direct cost, 
the loss of key management time 
can extract a very high price in 
time and wasted opportunities. 

Ironically, as the law stands, 
companies might be better off 


Senior managers of exporting 
companies spend as much as 10 
hours a month filling out 
intrastat re turn s for HM Customs, 
according to a survey by 
Community Network Services. 

All companies with exports 
and imports - or what are now 
called arrivals and despatches 
from the EU- of more than 
£140,000 are required to fill in 
the returns. But since intrastat 
was introduced at the start of 
1993, the system has been 
criticised for under-estimating 
the volume of UK imports. 

Some analysts, such as UBS*s 
BUI Martin, say the import 
figures are as much as 50 per cent 
adrift Now it appears the system 
is also eating Into the time that 
manag ements could be spending 
developing their businesses. The 
returns are often filled out by 
management accountants, 
company secretaries or finimriitl 
controllers. 

However, according to CNS, 
which offers a software package 
to help put together the intrastat 
data, only 9 per emit of companies 
submit returns by floppy disk 
and only 4 per cent used a modem 
or another form of electronic data ! 
interchange. Hie rest submitted 
their returns on paper. 

CNS. Tel 0489 589922 


Richard Gourlay considers 
Lord Strathclyde's role as UK 


minister for small businesses 


Making 



a mark 


wealth. But bis policy emphasis is 
clear. “Sole traders are very impor- 
tant They are crucial to loral areas 
but the area we want to concentrate 
on is those businesses with an 
equity gap that want to expand, 
tha t are entrepreneurial," he says. 

This prefer en ce Is well illustrated 
by plans to revamp the consultancy 
service currently offered under the 
Enterprise Initiative, for example. 
Lord Strathclyde says: “It will be 
fewer cnmpflniftg that mrrto into the 
net but those that do come In will 
get more out of it” 

While Lead Strathclyde is devel- 
oping his own views, there is no 
doubt his task is aided by fresh 
enthusiasm for smaller wimpaTiitw 
within the government “In the last 
three or four months there has been 
a step change in the way govern- 
ment and other organisations treat 
small firms,” he says. 

The chancellor's last Budget put 

the f unding ' gap ptl tha sgPft dq, with 
the announcement of a replacement 
for the Business Expansion Scheme 
and new venture capital investment 
trusts. He ai«i focused the debate 


about legislation to counter late 
payment relaxed a number of 
administrative rules, such as the 
need for wimUht companies to have 

a full audit- 

“1 think Ken Clarke (the chancel- 
lor] is genuinely very keen on this 
area of the economy ” Lord Strath- 
clyde says. “I see my role first to 
represent government policy and 
how it affects small business, and to 
make sure my colleagues in govern- 
ment are not thinking of legislation 
which will llama g p the inter * * * * of 
small businesses,” he says. But 
there are specific areas where he 
would hke to leave a mark. 

His first priority is Business lank, 
a project rfiampign ed by Michael 
Hesekme, trade arid in d ustry secre- 
tary, whi ch is design**! to bring the 
government's support services 
together in one^top shops. He says 
50 of the 200 planned outlets will be 
open by the end of the year. “We 
need to reach not so much the peo- 
ple who doont know they exist but 
those that- don’t know they need the 
services. And we have to counter 
the view that what is on offer from 




& 


JcnarenlteNr 


Lord S t r ad i cJ yd o: *We haw to mutter the view teat what is on offer to shoddy* 


government is cheap and shoddy.” 

Another priority is to sort out the 
issue of late payment Lord Strath- 
clyde says he “walked into the 
issue” on his first day, has wel- 
comed the quality of the formal sub- 
missions but remains agnostic an 
whether there should be a statutory 
right to interest on late debts. 

On finance, he would like to see 
greater use of the Loan Guarantee 


Scheme, recently raised to £250,000, 
as part of a package of finance. He 
recognises that investors in private 
companies need exit routes and sup- 
ports calls for some form of third 
market to replace the Unlisted Secu- 
rities Market *1 would like to see 
what the Stock Exchange is propos- 
ing nWhnng h it doesn't have to be 
under the Stock Exchange's aus- 
pices." 


British David takes on US Goliaths 


Meiko is a private UK company in a sector dominated by American rivals, writes Kate Button 


I t is rare for a small, private UK 
company to venture into the 
global market of an industry 
that is indisputably led by the US, 
and beat all comers hands-down. 
But Bristol-based Meiko has done 
just that 

Founded in 1985 by six engineers 
who specialised in the concept of 
high-performance computing, Meiko 
now employs 180 people and has an 
installed worldwide base of more 
than 440 systems. 

The company’s key technology is 
m assi vely parallel processing 
(MFP). a tiny new supercomputing 
sector, estimated to be worth $890m 
(£610m) by 1996. with an annual 
growth rate of 25 per cent MPP 


s y st em s onmfri ne hundreds or even 
thousands of cheap commodity 
chips to create mneh hi gher pro- 
cessing power at a much lower 
price than conventional super- 
computers. 

Meiko has been catapulted into 
competition with established big 
companies such as Cray Research, 
International Business Machines 
and Thinking Machines Meiko is 
estimated to have cornered 25 per 
rant of the global MFP market and 
is the industry leader in Europe. 

Tbe only big UK company in the 
field, Meiko sees itself as a cosmo- 
politan contender. "We are a global 
company working with global cus- 
tomers in a global market," insists 


John Fuchs-Chesney, itin^-nr of the 
UK holding company. Mriko lim- 
ited of Bristol, and executive 
vice-president of Meiko Scientific, 
the US subsidiary based in Wal- 
tham. Massachusetts. 

Meiko’s international qualities 
woe a critical component in a bid- 
ding match that upset the super- 
computing industry in July 1993. 
Meiko beat all US competitors an 
their home turf when it won the 
pitch to supply the government- 
funded Lawrence Livermore 
National Laboratory, California, 
with its latest and most powerful 
machine, the CS2 (Computing Sur- 
face 2). “Were Meiko a purely Brit- 
ish operation, we would never have 


won that contract,” says Fuchs- 
Chesney. 

US competitors • claimed that 
national security would be jeopard- 
ised. but Meiko had made sure that 
the terms of sale in both cases satis- 
fied all federal and national require- 
ments for the US and the UK. 

“If the guys at Iivennore decided 
that this is what they want, they 
should be able to buy it” comments 
Gary Smaby, a Minneapolis-based 
market researcher. 

The indignant clamour from the 
competition has abated winra pre- 
liminary acceptance trials run by 
Livermore proved successful “The 
outcome of the tests was better 
than we expected," says Mark 


Seager, who runs the testing unit at 
Livermore. “The acceptance criteria 
were some of the most stringent we 
have ever imposed.” 

Mffiko’s unpubHshed revenues are 
said to have doubled in 1993 with 
this single $17 .Sm sale. 

Despite tills coup, Fuchs-Chesney 
is reluctant to dramatise the compa- 
ny's success. Whereas the US high- 
tech industry is prone to taking 
immatur e companies public, Meiko 
is cautious about cashing in oh suc- 
cess prematurely. “These things 
take time, ” says Fuchs-Qiesney. “B 
may take three to five years of 
development with a client before 
.they .buy into the risk of a new 
market sector.” 


BUSINESS OPPORTUNITIES 


aamegiWEnrroMMninep to seat approwimb mop — omul novice before anarae into oo—nwms 


WORLD SALES EXCLUSIVITY 


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THE ANSWER IS SIMPLE) tbe Saadi Tekfira Commercial 

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Write to Box B2742, Financial Times, 
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A Urge international trading 
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Are you an established excess 
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rahfdHm: OKI 87B lilt 
TkeSBIBTBUOO 

roTIto SwwOls mS Nn MS) 


MEDICAL LASER 
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set to launch TWPLBX3E® in 
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*" n Bnn f "'iisflilHnr- 

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RESTOEPTIIAL PROPERTY 
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portfolios ot booses and Mods of Bats 
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The Docks- Coup. 13-14 Wqpnore 
Street. London WIH9DB 
Tot 071 5808366 Bra: 071255 1606 


CONFIRMABLE DRAFTS 
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OS. <714) 757-1070 - Fra (714) 757-127U 


shipping and administration facil- 
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MINIMUM ADVANCE: 
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If you run a company which has 
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but Lacks the capital to pursue the 
bigger deals, maybe we can help. 

Please write ter 


West & East Earopesn Official Agent 

First Class®"© 

International UK Limited 

FOJkn fit Nortbalt, Middlesex UBS SRY.Entfind 
TtebNcMIWlIU ttebnO, 681-MI 7344 Ttlrc *»l«Z7 KSTCLS G 
OmrWnsMAsr 
JWal for AdrertWag « rvMdty 
PO Ba* MIC Riyadh 1141} Rtagdare Saadi Arabfa 
Telephone 464U64 Facstanlc46UI42 


• Furnished Offices 

• Secretarial Services 

• Personal Telephone 
Answering 

■ Conference Facilities 
» Photocopier, Fax, 
Word Processing 

• Immediately Available 

• Flexible Lease Terms 


Tbe Managing Director 
Box BX1BI, Tbe financial Times, 


1 Southwark Bridge, 
London S El 9HL 


FRANCHISE 
MASTER LICENCE 


Whh a major UK Institution, we will 
consider quality financing proposals. 
L et ter s of luficatkm in 72 boots. 
Uigfa quality of service. Long- 
established Central London Finn. 
Principals only. 

| Write DO Bax B2SU3. Financial Times, 
One Soutbwai* Bridge, 

London SE1 9HL 


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COMPANIES/PRODUCTS 

Engi nr w i ng cu uHwn y series new 
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develop tbe btasrnexx. Companies 
perhaps operating ante capacity aad 
see k in g a nh or mer ge r . • 


Wtbe to BaxB2674.FaascialTbac$. 
OaeSouhwsrfc Bridge. London SEl 9HL 



CHANNEL ISLANDS 


Of&tme Company Foanarioo 
and Admiaistiuioc- Also Liberia. 
Panama &.BVI etc Total offshore 
facilities and services. 


For drtafl am d ippoimar-itf ante 




24 Sefaaotf Rd, Si Hslier. icney; CL 
Teb 0534 78774, Ax 0S34 35401 
Tb. 4197227 COFORM C 




INVESTOR 


European Locations 


Established franchise system in ibe 
United Kingdom is offering master 
licence in tire United Kingdom and 
other European countries. Profit 
centres incinde Franchise sales. 


INVESTMENT OPPORTUNITY 
IN AN ENGLISH COMPANY 


International Healthcare Village 
and Mini Hospital 


In England and Kazakhstan 


From Min $150,000 to $15,000,000 


* Construction already started * 
Investment received so fan $2,700,000 * 
* NHBC Guarantee * 


For further information please contact: 
The Managing Director 
Stoneville International pic 
England 

Fax: +44430430699 
Fax: +44 430 432271 
Tel: +44430432244 


Aamdoi 4-11 B) *077100 

tante Mrpon ■*»» noVsTTOQ 


supply sales and royalty income. 
Ttris one of a kind service busmen 


REQUIRED 

to acquire existing equity holding 
investment in won est a bft sl md (17 
years) insurance braking business. 
10% return p^. 


SMAl.i. 

HIT Ml Rfx-U i<A\r.M .!(*;■:. 
I’i’lMI uni lii. VI IMS, 
it \\im;wi:v, H i.it- n ;:i . > ->in\ 
>1 I K' u.r-mi \L 


RHAMCC OIRECTOM/PMIIT BUYERS 
EatabBahua Who printing company <SE 
area) vrlabaa to axmnd curtomar bass. 
C ask s ww fares aparafing In on o r ore at 
60k pm. V. Com pUltre teas offered In 
return for gua ren tssd ww*. I mp eccable 
cUenrnattndudBs ftmncoa i ns ura n ce 
markets. Pftneipafe only. Write In Bax 
BZ733, financial Timas, One9ou0imk 
EMdg&LmdonSEI 8HL 


AUCTIONS 


C o pmh ig r e 

■Mile 

DMddsrf 

CflWrj 

hnUait 

lleabar* 


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HUM! 


+49 B SB 44 10 
+U 1 111 77 II 
+45 nuns 
♦HI 14 754 244 
««iii store 
■Ml II 819 W W 
♦49*1+97*447 
+49 4a unn 
+-44 71 172 95* 
+ R2 UK«I 
+ M I SB *77 2 
+ U £71* 4700 
+49 B9 5* 04 70 
til 1 40 07 SO 07 


with no competition is one of tbe 
fastest growing franchises io 
America. For infixmation comacc 


Wi*e to Bax B2B77, Hnanefet Ureas, I 
One Soudwaik Bridge. London SCI 


BUSMESS DIOEST gaWyoor prefect area 
over 1000 kmefere end kweetaa dsaks 
te-NatfSO I Tat 0MB 67BBS 


NEXT AUCTIONS 

of life assurance policies for 
investment will be held in 

London on 3 s»d 17 March and 
in Bristol o« Thvrsday 24 March. 
Telephon e: 

B.E. Porter A CrtmfuU 
•71-408 1M1 for catalogue .- 
AtefearFUBSA 


:. iu ' 

** t \ 


Fonritnre Doctor 
Alberto J. Stagnaro 
•r Kenny Zarin 
8800-899-477 
(404) 381-9933 USA 
(404) 353-9797 Fax 


Lakgk Outlets Wanted 
For Very High Quality 


JOINERY 

MANUFACTURERS 


Irish mineral water is all sixes. 
Brand name or own label 
'principles* only apply to 
Box B25QS, financial Times. 
One Sonriiwarfc Bridge, 
London SEl 9RL 


OFFICE WANTED . 
1000 - 1200 sq ft office spaca 
KansingtorVCheteea 
far protossionei firm circa 2 years. 
Passfaly take up unwatod space 
erf sxiafag DCCupaiL 
iNo Agendas]. 

Phono: 071 3732834 


BUSINESSES FOR SALE 


International Construction 
Products Company 


Sod Strocans and Skytigbts 
For Sate or Merger io enable farther 
expsnrion. Mteet taader. 
Ttamorer 30 mfillaaL 


IL^A. ♦! 404 39233 C 

(» buliuix) 

Mlfa/U +41 1 10 rw 

pioarm) 

Japan +n I sm 1151 


Your rarcnrr ia ovrr 
H) Imcnuiloiul Borinra Lwilhai 


CAR INSURANCE 


COKHCRCUU. nHARCE VOan Crete 

AboiisteiyMymwaBdftWinMfe.M, ST-SS 

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at fraction or now cast. Fox [Inti wtaxna. tatfo *n»rican Vansssa Ud. 


| SateH iddepcarienl coopnoy opaatmg 
x uniqnc motor insurance seivice seeks . 
sangc&^oopcntiQn with 
brote / co mp any lo deal whh hue? 

I public response. Lxsr month 4000 

dieBB approedied vs and we need 
help to cxpbai the potential to become 
a real fores in tbe market. 


A long estabdabed, modern and well 
cqnippedjoinciyorgnnarionwith 
cniBtiitem bleaaKeremril capaUirics 
of a turnover of G million is seeking 
a nwjggrof trading pntamldp 
with a suitable co m p an y or 
boosing association, 
enquiries from overseas and 
European companies would be 
considered. Write to Box B274Q, 

! Financial Times, One Southwark 
Bridge, London SEl 9HL 


LOW COST 
ELECTRONIC DESIGN 


team of 350 qualified cagnees are 
looking for Western design projects. 
The low coble means highly 
competitive rate. 

Tel: 0453 900100 


hdepondenlraoord company 
has permbdon tor reteaw of new 
version of Bemstato classic and 
seeks TuncBng far commerdcf 
Project. 

wrtto Bax 80506, FrianddUmw, One 
Smsthwaric Bridge London SEl 9HL 


Write to Box B2732, Fiomaal Tbaa. 
One Sxtkmt Bridge, LtmdmSEl 9HL 


WELL EQUIPPED SHEET 
METAL FABRICATION 
COMPANY FOR SALE. 
Turnover £300k pis. 
Loafed West Midlands. 
Interested parties rqply n> Bax No. 
BZ737. financial Times, 
OwSoM bwari c Bridge. 
London SHI 9HL. 


CALL 081 9S3 2733 


31 10.43WSW 


T* {0824] 201306. Fax (092^ 2OT377 


FUNDS AVAILABLE 
TO PURCHASE 

* Leons of Credit 

* Bask Guarantees 

* Other Acceptable Collateral 

* Boded by Private Investors 

thru Major orn. BANES 
CAPITAL SUPPORT CORP. 

I US: (714) 757-1070 -ftjc(7lriJ 757- 1270 


FOR SALE 

E NGINEERING PROD UCT 

for padtagiag nfartry md sdUqg 
wuridw.uk, vriabes to acH prodoa 
line with rales affXm+paand 
tn^i spares cuateaL 
Write lo Box B2673, Pbaacal Times, I 
One Sautnrnt Bridge, LoodtreSI 9HL 


PRIVATE COMMERCIAL 
MORTGAGE 
OF £250,000 

REQUIRED URGENTLY. 

Write UK Bax B2675. PmucfeJ Times. 
Ose Sooibwtrk Bridge, Lndon SEl fflL 


FOR SALE 

BOAT BUILDING BUSINESS 
IN COSTA RICA 
Fret rone licence, full tax 
awnptiooa. trained wwkfbrcc. 
Ptuv ioml y buflding hi tedi 
yachts in fibregiasa. 

Factoiy at^accnno water. 
PMWE OR FAX: USA 407 334 9814 


Leading International 

Fashion House 


(Retail & Wholesale) 

*I70£2ftm, Profit flVan 

Principals ooly. 

Write to B0KB2686, Franml 

Times, One Sontinrark Bridge, 
London SHI 9HL 


BUSINESSES FOR SALE 


ESTABUBHED MANUFACTURER, H&v 
tecti eompmcf relsfed »bh blue ddp 
euaemwa rate ri' fe trji (ai to pmdte apprm 
1250000 lor anpension. Tot 0374482841 


MAJOR LIGHTING MANUFACTURER 
wishes to take on Rianutaoturing and 
iiuunmwy lor other pgefep and awdte 
products. Pfaase reply to Box 92738. 
Ftoonctel Ttmos. Orw Souenrerlc Bridge, 
London SEt AM. 


Appear in the Financial Times 
on Tuesdays, Fridays and Saturdays. 
Fra fionber mfbau6oa or to advertise 
in this section pkase contact 
Kari Loyntooon 071 873 4780 ra 
Mefanie Miles on 0718733308 


FINANCIALT1M6S 

iw»n nwm 












iths 


Kaii' 


A MAJOR PRINTING 
GROUP 

offers far sate as a erring concern In 
Whole or In part, three Sheet ted 
colour printing companies and repro 
house, all based In and around 
London. 

EstaMshad trade names 
Turnover in excess of £10m 
Leasehold promisee 
Prestigious customer base 

For further information contact 
B2537, Financial Times, One 
Southwark Bridge, London SEi BHL 

EnquHas arty Item serious cash 
boyars with funds avaBabig 
£0-5/1. 5nt only. 


FOR SALE/ 
MERGER 

Ferrous Foundry 
Located in South Yorkshire 
Turnover ltn, 

5 Ton Capacity. 

BS 5750 Approved 

Enquiries to: 

Robert M. Grierson «£ Co. 
Moor Oaks Lodge, 

Sheffield, S 10 1BX 
(0742) 680357 


Greetings Card 
Franchise For Sale 

Vary large exetuatvn ontny 
encompeseing BraMreo, Nawmai lmt. 
Buy St Edmunds, Ipswich and coastal 
areas. Business run 6om home whh 
tam#y car. Current GP cts.OOO p.a. 
Scope in double prafitabitty within 
6 months from odstfrtg product One. 
Two addUona) ranges launchkig 
In March. Personal reasons 
fence reluctant sate. 

Price £15,000 piua SAV. £15,000 
Call Sam or Sarah on 051 332 0506 

Fax: 0013321285 

Available for Sale 

Well established (17 years) 
insurance broking business. 

Turnover £396,000. 
Located in ihe North East 
Please respond to Box B250S, Financial 
Times, One Sootbwnric BrafeE. 
London SEI QULfoc further details. 

Transport and 
Contract Hire Business 

A contract dUtritaiioa and self drive Mrc 
corvpjay operating a modem Heel with 
contract* existing in both the 
East and West Midlafldsu 
For further information pirate contact 
Bos B2541. Financial Times. 

One Southwark Bridge. London SEI 9HL 

Estabiished Going Concern 
K qnhcd by individual with 
substantial funds. 

Any business minimum T/O £!M 
and PUT £100,000 in South East 
considered. 

Reply in confidence to SH Ross FCA 
2$ Wdbeck Street. London I Vi 

THEME BAR & 
RESTAURANT 
Windsor Town Centre 
Low rent &. rales with 
high turnover 
Business for Sale 
»-rue *• Bos B250I. FuwmM Tinas, 
Uac Southwark Bridge. London SEI 9UL 

PRAGUE leasing company 

EstaWhhcd reputation. 

UK. Czech nuoagemcnt/UK software. 
Exceilent contacts throughout Czech/ 
Slovak Republics. 5wis*-UK owners 
interested in commercial 
involve ment/rnerge r/ aapiisitton. 
Tet UK Director 0243 512270 
or Free (871) 494 2435 


Prestigious Customer Bale, 

170 £650.000. Profitabie. Strong 
Balance S hee t Modem Freehold 
Premises am! Plant. Suit Overseas 
Company/fnvtswr. 

Write In Box B2741. financial Time*. 
OndSw dwrt Bridge, Uwdwt SEI VUL 

FOR SALE 

Uuv-kinghamxhue tased printing and 
stationery company. 

Well established (25 yra). 
L : xcclknt trading position. 

Very profitabie with enormous 
further potential. Tit) 175UK.+ 

Price £375K + SjVV. 

WnK Id Bu, 02731. hunacid Ham. 
lW mwrtnmk Hrfcfec. I uarikm SEI WIL 


WELL ESTABLISHED 
AND PROFITABLE 
j SOUTH- COAST TECHNICAL 
ACENCV/ MANUFACTURING 
COMPANY FOR SALE. 

Iteasc wnttt# 
link Dim Fvuncot Cimm. 

Om SoudnMii Ondsir. Loodno SEI WL. 


PtNK PAGES is the weekly guide lo evi/y 
■iBobcm eonnuiiy. hie most eompranenswe 
nuido avallahla It Is a provan sosreo at 
taihwss tor llmsa walking ta the Insrtrenqi 
mtrieipttee. folly Indent it* 0 |n«nMM 
pink PAGES otiere direct contact with 
L lau Motors & Retainers. WS you Company 
Activity and Lqanon. ami o'lera rminere 
-.ummates lot war* comoany. tocWng toJ a 
burer Can you alfanf not tnjnw aftdtff 
EVERY msofcmcv opportunity tVEHrwwfr 


fOdv LIVE BUSINESSES FOB SALE 

and stSos ol assets tonriflhdy 07i 262 u64 

FacOTI 7063464 

MAYFAIR Aecofittncdallan oMtosu and 
tolophone. Pax. Mail, Pika‘o oTOco/ 
boardroom by the naur. Estahllshod 14 
voara- 0/1355 4333 


Healthcare Holdings pic 

and certain subsidiaries 

- Jo (All In Receivership) „ , 

:=? North Wales, Midlands, J/ 
<r^ Surrey i\* 

* a P The business and assets of this well _J ^ 

-S ^ established private medical group are " 

9 V offered as a going concern. L c 

^ O ■ Freehold or long leasehold ^ 

A interest in three acute-care 

\ hospitals in Wrexham, f~ 

^ Halesowen and Catcrham )» 

i ■ Long leasehold interest - A 

O [ nursing home in Kidderminster. L/ 

f ■ Total annual turnover approx f , 

£6M o 

^ C O ^ 

■ 160 employees ^ O 

■ A total of 78 beds ry . 

> s For further details contact the C/ i 

' J ^ Joint Administrative Receivers: < 

a. Maurice Withall or Peter Flesher, ^ 

\ ^ Grant Thornton, Grant Thornton ^ 

? House, Melton Street, Euston ^ 

J c Square, London NWl 2EP. ^ -sS 




(> \ 


Tel: 071-383 5100 Fax: 071-383 4077 

Grant Thornton® 

The U.K. member firm of Gram Thornton ImemotiofuL 
Authorised by ifcr Institute of Chartered Accountant* ia 
England and Wales co cany on investment burinos. 


and Wales to cany oo invesrmoK 


«^ wide SPECIALIST PRECAST CONCRETE 

■ STAIRCASE MANUFACTURER 

® PHILIP LONG & ROB IN MEADOW CROFT 
H the Administrative Receivers offer for sale 

■ the business and assets of 

W CHRISTIE STONE LIMITED 

■ ■ Good motorway access to M6 and M62 

■ ■ Freehold and leasehold premises with office 
JH aocommodaiion 

D ■ Modem factory buildings with CAD systems 

■ ■ 1993 turnover - £1.7M . 

■ ■ Skilled and motivated workforce 

■ ■ Over 70 established customers, national 

■ reputation 

■ For further details please contact 

■ Paul Ashworth or Jeremy Odtfie 

■ Parnell Kerr Fonier 

H Sovereign Haase - 

I pannell 

I r«L- 061 #32 SWI f/rpD 

■ Fax; 061 8393655 .. , 

N Aafaonmdby Ac tasnnne aTChanovd Aceaurmtai PfliRQTpP 
J Englmd md Wilra Patty on ImcBnica Ixninot i 

CHAfUEREDACCCXJNIANTS 


aaaaaAaaaaauaaaaufeUiaaaAaaauuiAAiifeiM 

BUSINESS FOR SALE 

INDUSTRIAL TEXTILE GROUP 

• Manufacturer of yams and non-woven fabrics, 
high specification textiles and textile products for 
industrial, military, food and domestic appfications 

• Market leader in each of its chosen product 
areas supplying a blue chip international 
customer base 

• Located in United Kingdom on five freehold sites 

• Experienced management team committed to 
the development of the business 

• Turnover £18.7 million 

• Profitable 

Potential purchasers please write to Jeremy Fum'iss 

at the address below: 

Livingstone Fisher pic 

Acre House, 11-15 Wilfiarti Road, London NWl 3ER 


\YvlTvings tone fisher 


The Acquisition & Disposal Specialists 
A Member of FTMBRA 


On the Instructions of Frames Tours Ltd. ■' 

HERALD HOUSE HOTEL, EDINBURGH 

Conveniently situated doee to Edinburgh City Centre 
45 en-smte letting bedrooms • Reception, krangB bar, restaurant 
Two conference rooms • Staff bungalow 

THE GATWICK SKYLODGE HOTEL 
CRAWLEY, SUSSEX 

Close to Gatwick Airport • 51 en-fluite letting bedrooms . . 
Reception, lounge bar • Restaurant • Parking for 50 vehicles 

BOTH HOTELS HELD ON LEASE, OFFERS INVITED 


071629 8171 


foiight Frank , llHitw>v , rSqu;nv 
iZ & Kutiev l.or.tlon Will 0AI1 


Livera Foods pic 

(In Administrative Receivership) 


Alan Kate and Kevin Mawer pf Arthur 
Andersen, the Joint Administrative Receivers 
offer for sale the business and assets of a 
chilled and frozen food manufacturer, 
specialising in desserts. 

Principal features include: 

■ Supplier to major supermarket chains, 
m Annual turnover of approximately £7m. 

■ Freehold property at Stockton-on-Tees 
(approx 8 acres). 

■ Specialist cooling/ freezing plant, continuous 
mixing and baking facilities, semi-automatic 
production and packing lines capable of 24 
hour production. 

■ Approximately 310 employees. 

For further information please contact: 

Alan Katz or Simon Longfield, 

Arthur Andersen. 

St Paul’s House, 

Park Square, 

Leeds LSI 2PJ 

Tel: 0532 416250. Fax: 0532 416397. 


Arthur 

Andersen 

Afril'K Andf.ksfn&iCo SC 


Arthur Andersen u authoraed by the Institute of Chartered Account Jilts in 
England jnd Wales lo carry on invevtmcnt business 


INTERNATIONAL 
FREIGHT FORWARDERS 

The Joint Administrative Receivers offer for sale the 
business and assets as a going concern of 

♦ A C P. (Shipping Agents) United which operates 
from freehold premises of 30.000 sq ftln London 
E14 

♦ AC P (Felixstowe) limited which operates from 
■ freehold premises of 1 ,200 sq ft In Felixstowe 

♦ Ensign Transport limited which operates a fleet 
of owned tomes from leasehold premises In 
BasSdon. Essex comprising approximately 
5.000 sq ft 

♦ International network of ogente and tong 
established customer base. 

♦ Combined turnover of £3.5 mfflon 

For further information please contact Ihe 
Joint Administrative Receiver 
Vivian Bcrirstow 

ROBSON RHODES RSM 

. _ inffeieiiionM 

iSurtcral Aujumanls MHH 


186 CBy Road, London EC1V 2NU 
Telephone: 071-251 1644 
Fax: 071-253 4629 Telex: 885734 

Revered To cony on audtf wortc <r*d cxitrortsed to carry on 
Investment business by Ihe iruHtute of Chartered Accountants 
In England end Wata* 


PEARL MAINTENANCE 
SERVICES LIMITED 
PEARL BUILDING 
CONTRACTS LIMITED 

(both in administrative receivership) 

The Joint Administrative Receivers offer for sale the 
business and assets of these established bunding 
mdhtenance companies 

♦ Blue chip customer base 

♦ Nationwide reactive maintenance service 
operating from locations in Barnet, Rugby. 
Leeds. Manchester and Glasgow 

♦ Expertise In afl bufldlng industry disciplines 

♦ Ski Bed workforce of 55 

♦ Business established for over 20 years 

For further information please contact the 
Joint Administrative Receiver 
Vivian Bcdrstow 

ROBSON RHODES RSM 

■Hi Chartered AuaunlaMbt Hl^m 

186 C8y Rood, London EC IV 2NU 
Telephone: 071-251 1644 
Fax: 071 -253 4629 Telex: 885734 

Regbtered to caiy on audit woric and authorised to cany on 
investment business by Itie IreWute of Chartered Accountants 
In England and Wales 


**^"* n , JlMM llarut Etmanml *** ** r f~^ . 

r j.BarreU (Steel Erectors) Limited 

t fa Barrett Enfllneeriag & Hecti OR Sendees 

• Th.- nmpany 8trtlcloral 8lCe! fab « aCion 

e SpaWctr^ hSidlins oreirncts from 15 u> 500 tonne*. 

WV-afrly pnxluctiiin 46 tonne*. 
s Cum .,,l turnover nronrai £J per annum. 


HTiTiiBaiKH 

HMOum. daor hiwm. 48 Cm* suw - LvJ. .— — 

(UirivJjr. U' 4W r 

iil »» ws rm **'*— "*“*’"" 


By instruction Of ihe John Axlrahrisiranv* Receiver 

MARTIN H UNTON FCA MSPI of LEIGH & CO 

Re: UNITFLX LIMITED (Faraitme Manufacturers) 

Hie Joint Atteiaisiralive Receiver agentt offer the 
business and asset* of ihe Contpeny as a going concent: 

• Previous tnnwver ia excess of fl million 

■ Fully equipped production facility i 

• Skilled and experienced work force 
- Mail-ofder and erpon cusioreers 

• Lease h old factory of 60JXX) square feet approx- j 


ENGINEERING COMPANY 

Long established profitable 
business providing specials/ 
fabrication, machinery and fitting 
facilities 10 a broad blue chip 
customer base. Located SW, 
T/OflJm, Price J350L 
Details from PFM Lid 
Fas: 0792474112 
PFM Alexandra House. 

! Alexandra Road, Swansea SAl 5 ED. 



Profitable Security 
Container Manuia 


acturer 


n Located in West of England 

■ A leading manufacturer of steel security containers 

■ Annualised turnover E2.5M 

■ Annualised profits currently C300K before proprietors' emoluments 

■ Seven year profitable track record 

■ Owners wish to retire 

For further information contact Barry Jones or Peter Smith, 

KPMG Peal Marwick. Marlborough House, Fitzalan Court, 

Fitzalan Road, Cardiff CF2 1TE. 

Telephone: (0222) 468000. Fax: (0222) 468202 or 468203. 


KPMGi Corporate Finance 

<XWG Coro ma Fmanc* a a praO m fl naaao ct KPMC Post Mamefc. wHcn a aunonnd By 
Vu MaUuM M Ownend tecamana n tirjons and to cairy on i wuMt ouamnoi 






ii ii i.'-t ’ 


2aa3sSEid3S££i(J:;a 



jIMITEE) 

JMITED 


Touche 

Boss 

& 


The Joint Liquidators, A. K facers and J. H. Atkinson, offer for sale (he 
business and assets of the above independent (lour packaging companies. 

■ Annual tumo\"erc.£l.9m. 

■ 3 (lour silos with total capacity of 100 tonnes of storage. 

■ Packaging capability or up to 3 50 tonnes per week. 

■ Freehold property in Corby, Northamptonshire. 

Further details are available from Richard Hemming* or Duncan Morris 
ac louche Ross & Co., Colmorc Gate, 2 Co I more Row, Birmingfuni 
B3 2BN. Tel: 021 200 2211. Fox: 021 236 1513. 


H ab .TJ u il» hyyaitowri .c«» 


« h FegLv«l *1 WJ™ la>4r»ae Inraakfll B a ^ i i 


STRATHCLYDE 
COACHBUILDERS LTD - 
IN PROVISIONAL UQUIDATION 

The Provisional Liquidator, C K Russell CA, offers for Sale this well established 
vehicle repair business with private and commercial divisions. Offers are invited 
from interested parties in the business as a going concern, as a whole or in part. 

■ Audited annual turnover for the year to 30 June 1992, £1.5m, forecast by the 
director for die year to June 1993, XI -fan. 

■ O n g oing Co n t ract s. ■ Esabl idled Customer Base. 

■ Skilled Workforce, 22. ■ Full Range of Plant and Machinery. 

■ Small Stock of Vehide Parts. ■ Leasehold premises at Reid Sneer, Glasgow. 
For further details contact: C K Russell Esq. Ktdsons Impey, 

Bnckenridge House, 274 Saudiiehall Street, GLASGOW G2 3EH. 

Tet 041 307 5000 Fax: 041 307 5005. 


ClattsiSi Atciiitaati 


A member of HLB [arernational 

Rtpmud m tarry t* em£s work end MBthtriad 
m cwtj m imaamrm hmmta kj Ar htaumx tf 
nmwwdAmutuat m UWWUo 








STATE PROPERTY AGENCY 


INVITATION FOR BIDS 

The State Property Agency as Caller 
offers in the form of a public tender of one phase 
a state owned share package 

in KEMIKAl Epitoanyagipari Rt 
(KEMUCAL Building Material LtdJ 
representing 76% of the issued capital of the firm. 

This is to inform interested parties that the 
issued capital of the Company is HUF 1,156,400,000 

Of the share package with the nominal value of HUF 878,864,000 bidders can apply 
for a share package representing 50% + 1 share of die issued capital. 

Bidder must offer compensation coupons for shares representing 10% of issued 
capital. 

The privatisation cost of HUF 2J)00,000 can only be paid in cash. 

"E" loan and compensation coupons can also be used for the purchase of the share 
package. 

Bidder must deposit HUF 20,000,000 of earnest money which will earn interest 
Bidder should keep die bid value for 90 days. 

Bids should be presented in 5 copies, in closed envelopes without marking ihe name 
of bidder, but indicating the original copy to the following address: official premises 
of 

All ami Vagyonugyn5ks6g 
Budapest, 1X33, Pozsonyi tit 56 

Submission deadline of the tender 12-14.00hrs„ April 27, 1994. 

The Slate Property Agency retains the right to declare the tender invalid. 

Preconditions for presenting the bid include to purchase the detailed tender 
document entitled ’KEMIKAL” for HUF 30,000 + VAT, and the issuance of a 
statement of confidentiality. 

For further information kindly contact Ott6 Ntidor, General Manager, 
1072. Budapest, Nagydi6fa u, 10-12. Tel: +361 - 122-068L 

INVEST IN HUNGARY • A SAFE EXPANSION 




Famous quality brand name for sale with design and 
production facilities. 

Name established over 50 years. 

White to Box B2502, Financial Times, Ok Sovthwasx Bbidqe, London SEI VHL 


Company specialising in (he manufacture of precast concrete 
components occupying 6 V* acre leasehold site 5 mins from the M25 seek 
merger or outright sale. 

Substantial surplus rental income and good order book. 

Together the business and property offer a sound investment potential 
and a considerable capital gain in the future. 

PImm write to Bat B2S07. Financial Iba OucSoAkwaric Bridge, Ltmdas SEI 9HL 



14 


TECHNOLOGY 


FINANCIAL TIMES TUESDAY MARCH l 1994 


Human drugs are being produced 
by livestock, says Victoria Griffith 

Milking time on 
transgenic farm 

a tenth of what it costs to boild a 


J onathan MacQuitty, chief 
executive of GenPhann Inter- 
national, a California-based 
biotechnology group, bristled 
with father ly pride when he 
announced in January the birth of 
eight calves at his livestock oper- 
ation in the Netherlands. 

These are not Just any calves. 
They are the first transgenic off- 
spring of Herman, the world’s 
first transgenic boll. Like their 
father, the calves carry a gene for 
the production of human lactofer- 
rtn, an antibacterial protein nor- 
mally produced in human milk. 
By milking the calves to obtain 
the protein, the company hopes 
eventually to have an entire farm 
pumping out lactoferrin for the 
world market 

“One of the advantages is that 
you could take your medicine by 
pouring the milk into your morn- 
ing bowl of cereal,” says Mac- 
Quitty. Lactoferrin may protect 
against bacterial infections of the 
gastrointestinal track. 

Several biotechnology groups - 
including GenPbarm, Genzyme 
Thtnsgenfcs and DNX in the US, 
and Pharmaceutical Proteins in 
Scotland - are pushing ahead 
with plans to produce sophisti- 
cated drugs through livestock. 
Genzyme has a herd of transgenic 
goats, DNX works with sheep and 
pigs and Pharmaceutical Proteins 
with sheep. 

Transgenic livestock is created 
by micro-injecting an artificial 
gene into a fertilised egg. Essen- 
tially, the egg is given extra DNA 
information. “Assembling the cor- 
rect pieces of DNA is the difficult 
part,” says MacQuitty. 

The egg is then placed inside 
the Ternale who later bears the 
calf, lamb or piglet. Once trans- 
genic livestock has been created, 
the animal is cross-bred with nou- 
transgenic livestock. The hope Is 
that about half the offspring will 
also be transgenic, although lev- 
els are running closer to 40 per 
cent at most operations. 

Companies are looking to 
genetic farming to cat down on 
production costs for certain pro- 
teins. “We believe the cost 
savings will be dramatic," says 
James Geraghty, president of 
Genzyme Transgenics, a subsid- 
iary of Boston-based Genzyme. 
“Capital costs would probably be 


factory, and the unit cost of pro- 
duction would be half of the cost 
we see today.” 

Some of the drugs companies 
are looking to produce are: Factor 
H, a clotting molecule used to 
treat haemophiliacs; human hae- 
moglobin, a blood substitute; and 
human collagen, to treat inconti- 
nence. 

Producing drugs through live- 
stock may have its limitations. “I 
think this is only cost effective if | 
you're dealing with proteins yon 
need in large quantities, and with 
large molecules which are easy to 
separate out," says John Logan, 
vice president of research at DNX. 

Other companies believe the 
technique has wider applications. 
Genzyme is looking to livestock 
farming to produce drugs that 
canno t be made in the laboratory. 
“It may be the only way to pro- 
duce membrane-bound proteins 
such as one we’re working on for 
cystic fibrosis," says Geraghty. 

DNX is also exploring new 
options, such as organ production 
for use in transplant surgery. 
Because or the severe shortage of 
human organ donors in the US, 
organ transplant surgeons are 
keen to turn to animal organs. 
But Inflammatory proteins of the 
immune system, known as com- 
plement, can destory the trans- 
planted organ within boors or 
even minutes. 

Complement Is normally held in 
check through inhibitors. To 
increase the chance of the organs' 
acceptance. DNX has expressed 
the human complement inhibitor 
gene in transgenic pigs. “There’s 
no way to grow an organ in a 
laboratory," says Logan, “so tins 
is the way to go for organ trans- 
plants.” 

Transgenic farming is stm in 
its early stages. Most products 
will not even start clinical trials, 
the first stage on the road to com- 
mercial approval, until the end of 
1995. 

However, there are encouraging 
signs that the technique will 
eventually be viable for large- 
scale drug production. With new 
generations of transgenic live- 
stock appearing, the genes are 
seen as increasingly stable. And 
potential applications for the 
technique are expanding. 


The century's 
last take-off 


Paul Betts reports on next month’s introduction 
of the world's biggest twin-engine airliner 



Boeing describes the 777 as “market-driven Airlines, auppfi c r a and subcontractors participated in Rs design and planning 


T here is a Guinness Book of 
Records quality about the 
777, the world’s biggest 
twin-engine airliner which 
Boeing, the world's biggest aircraft 
manufacturer, will run out for the 
first time on April 9. 

The first 300-400 seat airttners are 
being assembled outside Seattle in 
the US in a 1,000- acre site with 
about 98 acres of buildings under 
one root The aircraft will be the 
last all-new airliner programme 

developed this century, at a cost of 
more than $4bn (£2.7bn). 

The three leading aero-engine 
manufacturers - Pratt & Whitney 
and General Electric of the US and 
Rolls-Royce of the UK - are scram- 
bling to develop the world’s most 
powerful commercial jet engines to 
power the 777 and future, even 
larger, derivatives of the new Boe- 
ing widebody airliner. 

Since launching the 777 pro- 
gramme four years ago, it bag 
been “bet- the-company time" for 
Boeing, say senior e x ecutives. The 
development costs and iaari Hmeg 
are so significant that an aircraft 
manufacturer risks the health of 
the entire company every Hmp ft 
launches a big new programme, 
they e xplain , 

“Ifs certainly a gamble, but the 
777 is not as big a gamble as our 
decision to launch the 747 pro- 
gramme 25 years ago,” says Philip 
Comfit, Boeing’s president Part of 
the reason for Boeing’s greater con- 
fidence this time is the way the 
company has changed Its approach 
to developing an aircraft 
Boeing describes the 777 as a 
“market-driven” airliner. In the 
past tiie manufacturer felt it knew 
what was best for its airline cus- 
tomers. “Market planning for a new 
airliner was often based on the 
requi rements of a launch customer, 
combined with some rough expecta- 
tions about future markets,” 
explains Jeff Peace, chief project 
pnginopr of Boeing’s 777 division. 

“ The manufacturer would come 
up with a general idea for a new 
aircraft, convince an airline to buy 
it. then design it pretty much 
around the capabilities and features 
described by the launch airline,” he 
adds. 

With the 777, Boeing adopted 
from the start a more open stance 
towards the outside world, encour- 
aging airlines, suppliers and sub- 
contractors to participate actively 
in the design and planning of the 
new airliner. 

“Not that we did not listen to our 
customers in the past, but the big- 
gest lesson we learnt was that we 
often listened to them late in a pro- 
gramme," says Alan Mulally, the 
77Ts general programme manager. 
“Now. we are listening to them 
much earlier.” 

At all costs, the company wanted 
to avoid the mistakes made five 
years ago on the development of the 


747-400, the newest version of its 747 
jumbo. After failing to listen prop- 
erty to its customers, Boeing was 
forced to delay delivery for several 
months to initial customers because 
of teething problems and design 
changes demanded by airlines. 

Boeing’s new attitude to custom- 
ers. subcontractors and suppliers 
also reflected two - important 
changes in the market The first 
was the general slump in the civil 
aircraft business with airlines 
forced by heavy losses to cancel or 
postpone millions of dollars worth 
of new aircraft orders. The second 
and perhaps even more important 
factor was the emergence of Airbus 
Industrie as Boeing’s principal 
long-term challenger. 

The European aircraft manufac- 
turing consortium, which has 
steadily built market share during 
the past 20 years by launching 
advanced new aircraft programmes. 


has been making serious inroads 
into some of Boeing's traditional 
customers in the US. 

With nearly 30 per cent of the 
western market. Airbus has sought 
to leapfrog its bigger US rival by 


Airbus pre-empted 
Boeing by launching 
a new widebody 
family of aircraft with 
die A330 twin-engine 
airliner 


introducing new technological con- 
cepts to commercial jets including 
fly-by-wire electronic controls. It 
also pre-empted Boeing by launch- 
ing a new widebody family of air- 
craft with the A330 twin-engine air- 
liner and its sister aircraft, the 


four-engine A340, increasingly chal- 
lenging Boeing's dominance of the 
large airliner market 

Boeing’s response was to go out 
to the airlines to find out what 
exactly they wanted Ah' their future 
fleet requirements. It initially con- 
sulted eight (Delta, American and 
United in the US, British Airways 
in Europe, Japan Airlines, AH Nip- 
pon Airways, Cathay Pacific and 
Quotas in the Asia-Padfic region) to 
define the 777*8 configuration and 
purpose. 

It formed specialist task forces to 
analyse its most important opera- 
tional aspects, including everything 
from cargo loading to flight deck 
layout It then set up special design- 
build teams with the nTs three 
launch customers: BA, AH Nippon 
and United. 

BA sent a four-man team to Seat- 
tie where they were given access to 
all Boeing design staff and became 


deeply involved in the design pro- 
cess. Boeing introduced a similar 
working relationship with the 
engine manufacturers and other 
suppliers, ft also formed 235 design- 
build ttwm s inside the company to 
aflflhto employees from all company 
divisions to work together as well 
as with airlines and outside suppli- 
ers. These teams have been sharing 
a common database to help them 

communicate quickly. 

Barry Gosnold, the head of BA's 
engineering activities in Seattle, 
says the Boeing-BA team has led to 
more than 100 changes to the bask: 
specification of the aircraft. 
C 3 i;in g ps have also been made to 
improve the maintainability of the 
aircraft and to ensure that the air- 
liner is “service ready” from the 
first day it enters into service with 
BA in the second half of next year. 

BA says that among the most sig- 
nificant changes it has made was to 
persuade Boeing to adopt radial 
tyres, a device to store all the air- 
craft’s loadable software, and a 
space-saving galley allowing an 
additional four passenger seats to 
be fitted to the cabin. 

Another benefit of the intensive 
customer dialogue was the decision 
to rnakft about SO different items 
traditionally offered as optional fea- 
tures on other aircraft as standard 
equipment on the 777. This included 
satellite and global positioning 
systems, increasingly important air- 
craft safety and navigational tools 
which are basic to the 777. 

Boeing admits that the way it has 
designed and developed the 777 is 
tantamoun t to a cultural and tech- 
nical revolution for the traditionally 
“do it alone” manufac turer. In 
many respects, it is also a return to 
the past. As Comfit puts it “We are 
attempting to recapture the team 
spirit from the company's early 
days. In a sense, we’re looking back 
to create the future.” 

Collaboration is now set to inten- 
sify on fixture aircraft programmes. 
The two biggest challenges for the 
industry in the next century wQl be 
the development of a supezjumbo 
airliner capable of seating GOO to 800 
passengers and a second-generation 
supersonic aircraft to replace Con- 
corde with a longer range and about 
three times Concorde's 100 passen- 
ger seating capacity. On both these 
longer term projects, Boeing is 
already involved in joint studies 
with other leading manufacturers, 
including the four European Airbus 
partner companies, and with poten- 
tial airline customers. 

Ultimately, however, the driving 
force behind Boeing’s new, more 
open attitude to collaboration is to 
maintain its 60 percent share of the 
commercial aircraft market. “We 
will be focusing more than ever an 
oar customers' requirements 
because we don’t want to be left 
behind to allow someone else in,” 
Comfit says. 


■V 



HOW AIG’S ABILITY TO CONTROL FINANCIAL RISKS PUT 
ONE AIRLINE ON A STRAIGHTER COURSE. An afrtine's Jtsteoer energy 
hedge in jetjuel usiryaseriesojjixedjbrjbatir^^ transactions. It's no bhjesky idea but how ice recently helped 
a rrw/or US. carrier manage risk. Since the airline's international operations generate a multiple-currency revenue 


stream, we also act as one of its primary foreign exchange partners. And we provide primary and excess 


services ftr which more and more corporations are heading in AfG’s direction. Far the tfejinitiue response to risk. 


AIG 


WORLD LEADERS IN INSURANCE AND FINANCIAL SERVICES, 

American International Group. Inc. Dept A. 70 PJne Street New York. NY 10270. 



s. 












FINANCIAL TIMES TUESDAY MARCH 1 1994 


ARTS 


is 


New York Music 


Schnittke's 

broken 

symphonies 


T wo new symphonies by Alfred 
Schnittke, his Sixth and Seventh, 
were introduced to New York last 
mon th in a sudden succession 
that mirrored, if it slightly exaggerated, 
bis productivity. Since writing them (the 
Sixth was finished in 1992, the Seventh 
last Ju ly) he has already completed his 
Eighth Symphony, and his output of the 
last five years also includes several other 
Wf orchestral scores, chamber pieces, and 
two full-length operas, or which a long- 
planned Faust is scheduled for production 
next year in Hamburg, 

Quite how to interpret t hi s rate of out- 
put is one of the Schnittke conundrums. 
Are we dealing with a Haydn, composing 
fluently to order, or with a Hugo Wolf, 
impelled by creative demons? Much has 
been made of Schnittke’s music as report- 
age mi the speed or events in his native 
Russia. Much has been made, too, of his 
physical fragility - and Indeed he looked 
sadly aged wen beyond his 59 years as he 
was assisted onto the platform at each of 
these concerts. But the music is disin- 
clined - perhaps even unable - to explain 
itself: its very brokenness makes it mute 
as to causes. What we hear is the wreck- 
age; how it happened is left for us to 
wonder, if we wish. 


Both the new works are broken, 
wrecked symphonies, but especially the 
Sixth. It has the usual four movements, 
with a conventional scale, playing alto- 
gether for about half an hour. The con- 
tents. though, are weird even by 
Schnittke’s standards. The first move- 
ment, for instance, starts and ends with 
big dusters, hot the long Interim is thinly 
scored, and made tip of fragments that 
have no great pretensions: for long peri- 
ods the stage is held by a few brass 
instruments in chorales, or by low 
strings, again often in qnasi-litnrgical 
phrases. One remembers that Schnittke’s 
Second and Fourth symphonies were muf- 
fled religious ceremonies, but the feeling 
here is bare and wretched, and the great 
numbers who piled out of Carnegie P«n 
after this movement seemed to be making 
an understandable response. 

The Sixth Symphony was written for 
Mstislav Rostropovich and the National 
Symphony, who gave this performance; 
the Seventh, a New York Philharmonic 
commission being heard for the first time, 
was composed for another conductor with 
idiom Schnittke has had a long associa- 
tion: Kurt Masnr. It is a more compact 
piece than the Sixth, lasting little longer 
than twenty minutes, and a more continu- 
ous one. There are now three movements, 
and the first two are both so short as to 
seem prelodial, the opening andante 
being for strings and its successor turning 
to the wind and percussion. Then in what 
emerges as the main movement, the horns 
quite soon introduce a waltz-chorale that 
appears to satisfy demands for a principal 
theme. 


But the new symphony is hardly less 
bleak than its predecessor. Even its conti- 
nuity is not so much growth as wandering 
(in the case of the long opening for solo 
violin) or idling repetition - or finally 
both at once, as the slow waltz tune is 
played three times identically by soloists 
in the far bass (trombone, contrabassoon, 
doable bass). It is a haunting melody, hut 
not a soothing one, and its insufficiency 
as a gesture of farewell consolation is 
perhaps its point Schnittke, living now in 
Germany, pays homage to that country by 
encoding German place-names Into the 
second movement but ironically the notes 
he gets from “Deutschland" come very 
close to the DSCH cryptogram with which 
Shostakovich signed several of his works, 
and it Is to Shostakovich's example that 
this new symphony, like so mnch of 
Schnittke’s music, most conspicuously 
appeals. Shostakovich was. of necessity, a 
master of musical double-talk: of hollow 
affirmations, of savage glee. Schnittke 
opens up several further layers of split- 
ting, and leaves ns with music whose 
motivations are endlessly tangled, music 
whose increasing austerity has wily made 
It ever more uncertain and unsettling. 


Paul Griffiths 



Wax sculpture fry Medardo Rosso: “The Flesh of Others’, 1883 



Tactile works in wax and clay 


M edardo Rosso was bom in 
Turin in 1858. A spell of 
soldiering took him 
through his early 20s and 
it was not until he was 24 
that he turned seriously to art, entering 
the Brera Academy in Milan in the sum- 
mer of 1882. That too did not last long. 
Barely a year later he had been expelled 
for insubordination and taken himself off 
to show at that year’s International Exhi- 
bition of Fine Art in Rome. 

From that moment be was clearly an 
actor on the international stage, showing 
his work in major exhibitions at every 
opportunity - now at the Solon des hide- 
pendants In Paris, now in Venice, now in 
London, at the Albert Hafl. He was already 
travelling widely, and in 1889 he moved to 
Paris where he was to keep a studio 
almost until the mid of his life. Far the 
next 30 years he was acknowledged with 
Rodin as the principal sculptor of impres- 
sionism, his work shown throughout 
Europe. In 1898. when Rodin’s Balzac was 
first shown. Rosso was cited as putative 
influence - their friendship ended soon 
after. Bocdoni and Marinetti saw him as 
the revolutionary forerunner of Futurism. 
Upon Rodin's death in 1917, Apollinaire 


declared him the greatest sculptor alive. 

Six years on and the furniture in the 
Paris studio had been taken by the bailiffs 
against unpaid rent. He continued to 
show, mainly in Italy where he was still 
held in high regard, but the sense now is 
of a career and reputation in decline. He 
died in hospital in Milan in 1928, a little 
short of his 70th birthday, after having 
had a leg amputated following an accident 
to his foot 


And now? Rosso's sculpture, these many 
years past has been honoured mare in the 
form than the true observance, the work 
seldom seen and only in the isolated and 
occasional example. This full - though 
stiS quite small - and proper retrospective 
study is, therefore, of real art-historical 
moment a true event 
Whether It gives us the Rosso we might 
have expected. Rosso the proto-Futurist 
the suggestive, symbolic impressionist is 


another matter. What we do get is some- 
one altogether more ambiguous and sur- 
prising. at once more thoroughly old-fash- 
ioned and more profoundly radical and 
prescient than we supposed. 

He was never a carver, his materials 
were those of the modeller, clay and wax, 
by which the image may be realised 
directly and quickly, and either left as it is 
or cast into plaster or bronze. And as a 
modeller, the young Rosso works soundly 


enough within the genre conventions of 
the mid-l9th century, looking to the 
domesticity of Dalou, to the symbolism of 
Rodin, and perhaps back a little to the 
satirical figurines of Daumier. But he 
brings to such work his own peculiar 
attack, a rapid and tactile expressiveness 
in the actual working of the day, which 
soon enough becomes an end in itself. 

It is in this development that his revolu- 
tionary quality lies, and which today 


makes his work so relevant to current 
practice and preoccupation. What 
intrigued his contemporaries was the way 
in which increasingly he ramp to establish 
the most fleeting suggestion of head or 
face, a cast of countenance caught in the 
wing, with but most minimal apparent 
intervention on his part There was the 
impression, to be viewed perhaps from one 
side of what was manifestly still a lamp of 
stuff Yet the quality of that image, so 


beautiful, so delicate and haunting, as 
though seen through a veil, was what 
caught the fin-de-siide symbolist imagina- 
tion . 

Rosso's habit was to make several ver- 
sions of an image in parallel though not 
necessarily from the same original, now 
wax, now bronze, now plaster, each as 
close as possible but still different in its 
finish. Any original clay model would 
inevitably be destroyed in any case, in the 


malting of the plaster mould for subse- 
quent casts. Similarly, by the lost-wax pro- 
cess, the wax would be, well, lost. But 
each material, plaster, bronze or wax. has 
its particular qualities, and here repeat- 
edly we consider the variations, side by 
side - the matt, light-absorbent surface of 
the plaster, the heavy, patinated bronze, 
the translucent wax. 

Imagery apart, what we are left with are 
these differences, mid physical and mate- 
rial differences at that In noting them, we 
respond to them for being what they are in 
material terms of stuff and substance. 
Here is a chunk of plaster or a wilfully 
rough concavity of bronze, with a most 
delicate and sophisticated image on it 
right enough, but also an inside and an 
outside, a back and front There it is. not 
so much for what it might be as for what 
it is. Take it or leave it. Such is Rosso’s 
modernism as it speaks to us today. 


Medardo Rosso: Whitechapel Art Gallery, 
Whitechapel High Street El, until April 
24, then on to Edinburgh and Leeds - a 
national touring exhibition from the 
South Bank Centre, sponsored by British 
Telecom. 


William Packer on a surprising and ambiguous retrospective of the 
work of Medardo Rosso, a contemporary of Rodin - 


Weekend recitals/David Murray 

Young soloists take centre stage 


T here were notable recitals by two 
young artists this past weekend, 
but of different orders. At the 
Barbican on Sunday afternoon we 
had the phenomenal Siberian-Israeli vio- 
linist Maxim Vengerov, aged nineteen-and- 
a-half years. At the Wigmore Hail the 
night before, the pianist Peter Jablonski - 
three years older - was the latest “Out- 
standing Young Artist” in the Marks & 
Spencer series. Jablonski was fluent, 
finely sensitive, technically well-schooled 
and full of maturing promise. Vengerov, 
however, is something extraordinary, so 
preteraatoraDy “natural" a violinist as to 
compel rapt attention and awe as well as 
delight 

As is his wont, he chose an eminently 
serious programme, leaving spectacular 
feats for the Wieniawski Polonaise at the 


end and for his encores - just two Krefe- 
lers and a sort of frantic galop by Bazzini, 
all dazzlingty brilliant (At the Wigmore 
last March, he spun off showpiece encores 
for same 40 minutes.) Vengerov is a glori- 
ous champion of such old-fashioned stuff, 
as you would expect of a Comp] eat Violin- 
ist like him. Almost invariably it was com- 
posed by master-performers, who knew 
better than anybody how to exploit the 
possibilities of the instrument to the limit 
He does them frill honour. 

In classical works he exercises respect- 
ful self-restraint Here, he began with Moz- 


art’s K. 305 Sonata in A, in which the 
piano almost shades the violin, and then 
proceeded to old Brahms's lovely, vernal 
Sonata in G. Though Vengerov is fortu- 
nate in his current piano partner - Itamar 
Golan, no mere accompanist but an imagi- 
native virtuoso in his own right - it took 
them most of the recital to find a just 
balance in the Barbican acoustic. 

In the Mozart, designed for a much ligh- 
ter “harpsichord or fortepiano”, and some- 
times in Brahms too, the piano over- 
weighed the violin. After the interval, 
when perhaps somebody had warned 


them, Golan was self-effacing to a fault in 
Prokofiev's visionary F minor Sonata, 
black and brooding. Little harm was done, 
for Vengerov pursues a musical line with 
such full-hearted intensity, always 
smoothly controlled but speaking vol- 
umes, that one has to listen like the 
Ancient Mariner’s guest. He thinks in very 
long paragraphs, not just phrases. In fact 
his seamlessly articulate legato in Brahms 
risked leaving too few breathing-spaces for 
comfort - but while it went on. nobody 
could conceivably complaia 
Until he let his hair down for his sensa- 


tional Wieniawski and the encores, it was 
the Prokofiev that displayed Vengerov’s 
superb gifts at fullest stretch. Jablonski 
too was at his best in Prokofiev, tbe angry, 
nervy Seventh Sonata; it was impressively 
taut and searching, if without the ultimate 
degree of scathing force. 

Similarly, the first and last pieces of 
Debussy's Book I /mopes built admirably 
toward climaxes which proved rather mild 
when they arrived - like Liszt's fustian 
“St Frauds Walking on the Water", too 
loosely aqueous (and too foxed by finger- 
slips). In four Scarlatti sonatas Jablonski 
offered less fantasy and less vital “ping” 
than Leon McCawley two weeks ago. but a 
subtler, more delicate sound-palette. His F 
minor sonata K.466 was beautifully imag- 
ined, a transparent dream of melancholy. 


International 

Arts 

guide 


■ AMSTERDAM 


Browner as Angelina (03-233 6685) 
deSmgef Tonight, tomorrow, Fri, 

Sat Jan Fab re solo theatre show 
entitled Who shall speak my thought 
(03-248 3800) 


■ BASLE 

• Garcia Navarro conducts 
Barcelona City Orchestra on Thurs 
at the Casino, with music by 
Gerhard, Falla and Ravel (061-272 
1176) 

• Friedrich Cerha conducts Hans 
HoUmann's new production of Lulu, 
opening on Sun at the Stadttheater 
(061-295 1133) 


Concertgebouw Tonight Gidon 

Kremer and Martha Argerich play 
Beethoven violin sonatas. Tomorrow. 
Isabelle van Keuten violin recrtaf. 
Thurs, Sat Takacs Quartet. Fri: 
David Geringas cello recital. Sun 
afternoon: Netherlands Bach 
Orchestra and Chorus in Bach s 
St Matthew Passion (24-hour 
information service 020-675 4411 
ticket reservations 020-671 8345) 
Muxiektheater Thurs: Afoerto Zedda 
conducts revival of Dario Fa’s 
production of II barbiere di Shriglia, 
with cast led by Vassily GereHo. 
Monica Bacelli and Hong-Shen U 
(in repertory till March 26). Fri. Sun 
next Mon. Wed. Thurs: Nedertands 
Dans Theater in two programmes, 
including choreographies by Hans 
van Manen and Susan ne Links 
(020-625 5455) 

■ ANTWERP 

tie Vtaamse Opera Tonight, Thurs, 
Fri. Sun afternoon: Evelino Pido 
conducts Guy Joosten’s production 
of La Cenerentoia, with Alison 


BRUSSELS 
ais des Beaux Arts Fri evening, 
i afternoon: Jun'iehi Htrokami 
ducts Belgian National Orchestra 
/orks by Prokofiev, Schnittke 
Tchaikovsky, with cello soloist 
eH Thedeen. Sat: Carl Davis 
ducts RTL Symphony Orchestra, 
i evening (Eglise des Minlmes): 
ard Ensemble in Renaissance 
a) music (02-507 8200) 
nnaie Sat: Gianluigl Gelmetti 
ducts first night of Luca 
con i 's new production of 
sini’s Otello. starring Chis Merritt 
Leila Cubed!. Repeated March 
0, 13, 16, 19. 22. 24, 27 (02-218 

1 ) 

Sire National A Manvaux 
ble-blH. comprising L’Ecole des 
es and Les Acteurs de Bonne 
opens tomorrow and runs daily 
apt Mon till March 12- Directed 
itaude Stratz (02-217 0303) 


■ CHICAGO 

THEATRE 


• The Night of the Iguana: Robert 
Falls directs Tennessee Williams’ 
late play, with William Peterson as 
the debased mi raster drawn to a 
New England spinster, played by 
Cherry Jones. Opens on Fri 
(Goodman 312-443 3800) 

• The Mesmerist Ara Wilson’s 
play, set In 1884 India, about the 
leader of a spiritual society who 
is investigated when her mystical 
powers are called into doubt Till 
April 3 (Steppenwotf 312-335 1650) 

• The Importance of Being 
Earnest Oscar Wilde’s classic 
comedy directed by Nicholas 
RuddelL T m April 3 (Court 312-753 
4472) 

• Joseph and the Amazing 
Technicotour Dreamcoat: the 
Andrew Lloyd Webber musical 
directed by Stephen Pimtoft, with 
former teen heartthrob Donny 
Osmond as the Bible's flashiest 
dresser (Chicago 312-902 1500) 

• Second City: the improvisationai 
comedy craze was bom in Chicago, 
and Second City is still its hub. 
Catch a comedy revue on the man 
stage or the company's smaller 
theatre (Second City, 312-337 3992) 


■ GENEVA 

Victoria HaB Tonight, tomorrow: 
Arrru'n Jordan conducts Suisse 
Romande Orchestra and Pro Arte 
Chorus in Verdi's Requiem (022-311 
2511). Fit Garcia Navarro conducts 
Barcelona City Orchestra in works 
by Gerhard, Fafia and Ravel 
(022-310 6611) 

Com6cfie Opening tonight Maly 
Theatre of St Petersburg presents 
a two-week run of its 
widely- acclaimed theatre spectacle 
entitled Claustrophobia 


(022-320 5001) 

Grand Tftdatre The next opera 
production Is Billy Budd, opening 
on March 15 with a cast led by 
Robert Tear and Wiflarri White 
(022-311 2311) 


■ LAUSANNE 

Casino de Montbenon Fri: Andrew 
Litton conducts Lausanne Chamber 
Orchestra in works by Weber, 
Strauss and Poulenc, with piano 
soloist Brigitte Engerer (021-312 
6433) 

Thdfttre de Beaulieu Sat and Sun: 
Nedertands Dans Theater In 
choreographies by Jiri Kyflan. March 
13-20: Gluck’s Iphig&iie en Tauride 
(021-312 6433) 


■ VIENNA 

Staatsoper Tonight La traviata with 
Nancy Gustafson, Keith Ika/a-Purefy 
and Juan Pons. Tomorrow, Sat, 
next Thurs: Samson et Daiita with 
Baftsa and Carreras. Thurs, next 
Mon: L’ttaltara in Algeri with 
Vessetma Kasarova and Rockwell 
Blake. Fri and Sat Kenneth 
MacMillan's ballet Manon. March 
18. 21. 23: Carlos Kleiber conducts 
Der Rosenkavafier (51444 2955) 
Musfkverein Tomorrow: Leio 
University Wagner Society Orchestra 
of Japan plays Takemitsu, Ravel 
and Mahler. Thus: Martin HaselbOck 
conducts Wiener Akademie in works 
by Haydn and Hummel. Fri: 
Kazimierz Kord conducts Warsaw 
National Philharmonic Orchestra 
in Brahms and Shostakovich, with 
piano soloist Valery Afanassiev. Sat 
and Sum Wolfgang Sawalllsch 
conducts Vienna Symphony 
Orchestra fn Haydn, Apostel and 


Schumann. Sun afternoon, next 
Mon evening: Rudolf Buchbinder 
is piano soloist with Tonkunstier 
Orchestra. March 11: Alfred Brands) 
(505 8190) 

Konzerttiaus Fri: Ivan Fischer 
conducts Austrian Radio Symphony 
Orchestra in works by Part and 
Bruckner. Sat afternoon. Sun 
morning: Vienna Chamber Orchestra 
plays Shostakovich and Schubert 
Next Mon: Dmitri Bashkirov piano 
recital (712 1211) 

Messepalast Tonight, tomorrow, 
Thurs: Compania Naciona! de Danza 
in choreographies by Nacho Duato. 
Sat, Sun, next Tues, Wed: Cloud 
Gate Dance Theatre (586 1676) 


■ WASHINGTON 

OPERA/CONCERTS 

• Washington Opera ends its 
season with Un ballo in maschera 
and Madams Butterfly, in repertory 
at Kennedy Center Opera House 
till March 20. The Vardi cast 
Includes Richard Margison and Usa 
Gasteen. Yan Yan Wang sings the 
title rote of the Puccini (202-416 
7800) 

• Evelyn Glennie is percussion 
soloist with National Symphony 
Orchestra, conducted by 
Rostropovich, at Kennedy Center 
Concert Hafl on Thurs, Fri, Sat and 
next Tues (202-467 4600) 

+ James Paul conducts Baltimore 
Symphony Orchestra on Fri and 
Sat at Baltimore’s Joseph Meyerhoff 
Symphony Hall, with violin soloist 
Julian Rachlin. The programme 
includes Bruch's Violin Concerto 
and Elgar's Enigma Variations 
(410-783 8000) 

THEATRE 

• My Astonishing Self. Donat 


Donnelly’s one-man show about 
George Bernard Shaw can be seen 
on Fri, Sat and Sun at Folger 
Shakespeare Library (202-544 7077) 

• Breaking the Silence: Stephen 
Poliakoff’s 1984 play about the 
struggles of a family on the run from 
the Russian Revolution. Till Mach 
20 at Church Street Theater 
(202-657 2465) 

• Othello: Shakespeare’s play 

is directed by Irene Lewis at Centre 
Stage's Peart stone Theater. Till 
March 20 (410-332 0033} 


■ ZURICH 

Kongresshaus Tonight: Montserrat 
Cabalte song recital (01-261 1600) 
Tonftatie Tonight, tomorrow. Thurs, 
Fri: Horst Stein conducts Tonhalle 
Orchestra in works by Mendelssohn, 
Weber and Reger, with piano soloist 
Denes Varjon. Sat: Eduard Muri 
conducts South-West German 
Philharmonic Orchestra and Chorus 
in works by Beethoven and Rossini. 
Sun: Bach's Matthew Passion. 
March 13: Alfred Brendel (01-261 
1600) 

Opernhaus Tonight Leopold Hager 
conducts Bruckner’s Eighth 
Symphony, Tomorrow, Sat Nikolaus 
Harnoncourt conducts JCtrgen 
Flimm’s production of Alcina. Thurs, 
Sun: Le nozze di Figaro with cast 
headed by Ruggero Raimondi 
(01-262 0909) 

Schauspfelhaus Tonight tomorrow. 
Thurs: DOrrenmatt’s The Visit Fri, 
Sat Sun: Peter Shaffer's 1965 play 
Black Comedy (01-221 2283) 


ARTS GUIDE 

Monday: Berlin, New York and 
Paris. 

Tuesday: Austria. Belgium. 
Netherlands, Switzerland, Chi- 
cago. Washington. 
Wednesday: France, Ger- 
many. Scandinavia. 

Thursday: Italy, Spain, Athens, 
London. Prague. 

Friday: Exhibitions Guide. 

European Cable and 
Satellite Business TV 

(Central European Time) 
MONDAY TO FRIDAY 
NBC/Super Channel: FT Busi- 
ness Today 1330; FT Business 
Tonight 1730, 2230 

MONDAY 

NBC/Super Channel; FT 
Reports 1230. 

TUESDAY 

Euro news: FT Repons 0745. 

1315. 1545. 1815. 2345 
WEDNESDAY 

NBC/Super Channel: FT 
Reports 1230 

FRIDAY 

NBC/Super Channel: FT 
Reports 1230 

Sky News: FT Reports 0230, 
2030 

SUNDAY 

NBC/Super Channel: FT 
Reports 2230 

Sky News: FT Reports 0430. 
1730; 











W hen the buses and 
trams stopped 
running in many 
parts of Germany 
for a couple of hours early yes* 
today morning, most commut- 
ers reacted with calm and good 
humour. They were only wit- 
nessing a brief rash of token 
strikes, after all, and nothing 
like the widespread chaos 
caused by an Il-day Stoppage 
called by the public sector 
trade unions two years ago. 

This time nobody believes 
that the unions will go that 
for. Not only are they operat- 
ing against a background of 
Sharply rising unemployment; 
they are negotiating with a 
bunch of employers whose cof- 
fers are visibly empty . 

For once, the public sector 
pay round, covering some Urn 
workers ranging from bus driv- 
ers to garbage collectors, 
school caretakers and postal 
workers, has united the nor- 
mally quarrelsome ranks of the 
German political establish- 
ment 

From the ruling conserva- 
tive-liberal coalition in Bonn, 
through the 16 state govern- 
ments, to the whole multiplic- 
ity of local authorities, ranks 
have closed in flavour of an out- 
right pay freeze. 

At every level of government 
hr Germany, budgets are under 
extraordinary pressure. It is 
not just the federal govern- 
ment in Wort" that is desper- 
ately struggling to keep its net 
borrowing under DM70bn 
(£27.2hn) for the second year in 
succession. The wealthy west 
German states will this year be 
forced bo borrow DM2fL5bu on 
the capital markets, for the 
first time exceeding their 
all-time record deficit of 
DM26. Ibn in 198L 
tn east Germany, the five 
“new” federal states which 
began life at unification in 1989 
without any debts at all, now 
expect to borrow DM28bn this 
year. By the end of 1994, they 
will have run up a debt moun- 
tain of DM76bn. 

As for the local authorities, 
their combined net borrowing 
this year will add another 
DM22bn to the total, in spite of 
a severe squeeze on services. 

At the weekend, Mr Tbeo 
Waigel, Germany's irrepress- 
ible finance minister, sought to 
put toe best possible gloss on 
the situation when he told his 
Group or Seven colleagues 
about the prospects for eco- 
nomic recovery. 

The Bonn government will 
cut its budget deficit from the 
current 3J> per cent of gross 
domestic product to less 3 per 
cent by 1995, he said - and 
thus conform once again to the 
level laid down in the Maas- 


Quentin Peel on Germany's 
runaway public sector debt 


Up, up 

and away 


Qemuivh dwlrt bunrtlwri 


Total pubic; 3©ctor*tetjt{0M»4 . 





interest rate burden, of pubflc auth ori ties (CT^irf 


aoob'V; 


K of tax revenues 






- I*,'... 


• o . an. 40- .‘.so so too ; teo i4q-?T)tK 
SdWMrOtfr • • • - ■ ;> 


tricht treaty for European eco- 
nomic and monetary union. 

What he failed to mention 
was that at precisely the same 
time - in 1995 - the overall 
public sector debt will sail 
through another Maastricht 
convergence criterion, topping 
DM2,000bn, or rather more 
than 60 per cent of GDP. 

It Is a prospect that Is caus- 
ing concern right through the 
German economic and busi- 
ness establishment, not least 
because the process seems to 
be unstoppable. 

The Bundesbank warned in 
its latest monthly report that 
the total public sector debt was 
approaching the Maastricht 

railing “by leaps and bounds”. 

According to a comprehen- 
sive analysis just published by 
the German chambers of com- 
merce and industry (DIHT), the 
public sector debt will reach 
DM2.163.5bn in 1995, or 62.7 per 
cent of GDP. 

What the DIHT is seeking to 
launch is an entire debate on 
the nature of public spending, 
and the need for wholesale 
structural reforms. Instead of 
the piecemeal approach of 
annual savings packages 
adopted by Mr Waigel and his 


colleagues in Bonn and the fed- 
eral states. 

In the first 30 years of the 
German federal republic, the 
public sector accumulated a 
total debt of DMSOObn, the 
DIHT says. In just five years 
since German unification, the 
republic will have added dou- 
ble that awinimi i p ncfirng tho 

debt burden up from 
DMl,089bn in 1990 to the fore- 
cast DM2,163 -5bn next year. 


U nification is obvi- 
ously one over- 
whelming factor for 
the surge. The other 
is the explosion of social spend- 
ing. The last straw has been 
the addition of east German 
debts to the total: DM275bn 
from the Treuhand privatisa- 
tion agency wOl be taken over 
by the federal government next 
year, and some DM125 bn in 
debts from the former East 
German ha rp in g fund. Add to 
that some DMSOhn in the debt 
burden of the combined Ger- 
man railway system, assumed 
from last January 1, and the 
DM2,000bn barrier win be eas- 
ily surpassed. 

What concerns the DIHT, 
however, is not just the scale 


FINANCIAL TIMES 


HOSKYNS ©MANPOWER SPEAKERS 

/Il/tjAliVu con measure the difference INCLUDE: 


The Hon Thomas Sackville MP 
Undersecretary of State for Health 


John Oughton 
Cabinet Office 


John Gillett 
IBM Europe 


MARKET 
TESTING 
IN THE 


Maggi Bell 
Manpower pic 


Graham Wallace 
Granada pic 

Charles Cox 
Hoskyns Group pic 


Mark Ralf 

S mithKKne Beecbam pic 


Paul Maynard 
British Gas pic 


John Jack 
Pnocord Ltd 


NHS 


Stephen Harrhy 

Mid Glamorgan NHS Trust 


Terry Brace-Cough 
Ryder pic 


John Owens 

Haringey Healthcare NHS Trust 


National Association Of 


ConfcrciKc 

oqpnivd 




Tuesday l9Aj>ril 1994 
QFJI Con/nrcnce Centre . 
HV.v twins U r Lo ndon 


[Health Authorities And Ihists l 


OWENS 

ASSOCIATES 


^Tull conference details from ^ 


ctv AM f-r a f . nrnvras TUESDAY MARCH 1 1994 


of borrowing, but the purpose 
to which tt is put For the level 
of consumption in public 
spending has been steadily 
increasing at the expense of 
investment spending: 

In the budgets oTthe federal 
states, for example, more than 
82 per cent of their combined 
spending of DM-SSKm last year 
was on the current account. Of 
that, DBQ75bn, or 38^ per cent 
of the total, was on the wage 
bin. Another DMTLSbn was on 
administrative expenses. “The 
Lander," says the DIHT, "are 
becoming little more than 
labour-intensive service enter- 


Joe Rogaly 


I NAHAT. Birm i ngham Research Park, 
* Vincent Drive. Birmingham B15 2SQ 
| TO: 021-471 4444. Fax: 01! J-l 14 1120 


| Name Mr/ MrV Ms/ Other . 


This major cuiilnrwjo aims to alert Chairmen 
and Direc tors of Trusts and Purchasing 

Authorities 10 the potential offered by 
••outsourcing*' for a (hiding greater value and 
improved quality. 1 our Key stages of the 
process will be illustrated \ viTtr-ca.se studies: 


Company/ Organisation , 


Defining purchasing strategy 


Building the specification 


[*] 


The other main concern is 
that Mr WaigeL's hope of bring- 
ing his net borrowing back 
within 3 per cent of GDP is 
based - on over-optimistic 
assumptions of future eco- 
nomic growth. 

Tire finance mini stry's medi- 
um-term plan assumes a nomi- 
nal growth rate of GDP of 6 per 
cent a year up to 1997, and a 3 
per rant animal spending limit 
On the hasis of this the total 
net increase in debt would be 
DM288bn between 1993-97. The 
extra interest rate burden 
would add a further DM17.3bn, 
assuming a 6 per cent interest 
rate. 

Yet if the nominal growth is 
only 5 per cent, the accumu- 
lated deficit would hit 
DM425 -6bn. ami the extra inter- 
est burden would total 
DM25£bn. 

It is a grim prospect for 
whichever party or parties win 
the coming national efarHfma 
in October, let alone the vari- 
ous state and local elections in 
the offing. 

The one man who is cur- 
rently seeking to maim politi- 
cal capital out of it is a real 
outsider. Mr Jtirgen M6Be- 
mann, the former economics 
minister, now languishing in 
the wings of the Free Demo- ! 
era tic party, plotting to get i 
back into power. 

He has published a radical 
plan which would slash the 
number of federal government 
ministries from. IS to 12, the 
number of members of parlia- 
ment from 662 to 500, and the 
number of federal states from 
16 to 7. He wants to slash sub- 
sidies to ailing sectors - such 
as agriculture - and increase 
charges for public services 
across the board, like energy, 
water and sewage. 

The trouble is that he is 
largely a discredited force, in 
his own party and in the ruling 
coalition. He is unloved by the 
opposition SPD. So foe proba- 
bility must be that the debt 
wifi go on soaring, and radical 
solutions he rejected in favour 
of piecemeal savings. 


Chousing suppliers and managing 
relationships 


| City 

| Pom Code, 
I Country _ 


Delivering quality and value improvements 


PROCORD 


777 CT: 


SmrthKJme Baech&m 

Pharmaceuticals 


j^Typc of Business 


- I 


The pease plan 
for Northern 
Ireland put for- 
ward by Mr 
Albert Reyn- 
olds and Mr 
.I ntin Major has 
so for benefit- 
ted only the 
IRA and Sinn Ffein, its political 
wing. Optimists chirp that this 
is part of a process that may 
lead to a ceasefire. The rest erf 
us can only gift our teeth and 
bear it 

The Irish and UK prime min- 
isters will say that their joint 
declaration of December 16 
stands. It is a permanent invi- 
tation to the terrorists to lay 
down their arms and pursue 
their aims by democratic 
means. Maybe they wifi, but 
there is no obvious reason why 
they should hurry. The presi- 
dent of Sinn FSbo, Mr Gerry 
Adams, is floating high on the 
oxygen of publicity. The IRA 
has not ceased its violence. Its 
political front resists every 
opportunity to condemn the 
use of the bomb and the bullet, 
let alone undertake to secure 
their abandonment While the 
nati onalis t side stands armed 
and firing, the equally repre- 
hensible “loyalist'’ terrorists 
retaliate. Yet London, Dublin 
and soppy liberals everywhere 
dance around Sum. F&n, m a 
ritual of courtship that must 
bring a smile to the face of 

their president 

The list of concessions 
wrung out of the Irish and 
British governments is 
depressing. Restrictions on 
broadcasts which had been in 
force for 23 years have been 
lifted by the Irish government 
This leaves the UK exposed, as 
it maintains the absurd rule 
that Mr Adams and his cohorts 
may be seen, but not heard, on 
TV. The use of dubbed actors’ 
voices is a propaganda victory 
for Sinn F§in every time one of 
its spokesmen appears. This 
"censorship” has enhanced Mr 
Adams’s reputation in US eyes. 


fife was crowned madia, king 
for 48 hours after being 
granted a visa by US President 
BUI Clinton, against the wish 
of the British, but not the 
Irish, authorities. It may be 
that he will not lie given a sec- 
ond .opportunity to do the 
rounds of foe New York TV 
studios unless he first 
renounces violence- Perhaps 
Mr Major is being assured of 
that during his visit to the 
White House this week. It mat- 
ters not, either way. Mr Adams 
tias the cameras at his finger- 
tips. If he cannot go to them, 
they wifi. come to him. His abil- 
ity to say that his voice may 
not be heard hi Britain helps, 
not hinders, Ms perform a nce. 

For the moment, he is a star 
of global communications. 
About a thou- — r 


Adams demanded that the 
Unionist “veto” on any future 
constitution be lifted; the UK 
continues' to- explain patiently, 
as ' has "Mr Reynolds, that 
aeft-deterratoation means that 
no solution can be imposed. 
Most Irish .Votera support that 
basic principle: 

AIL of this most be music to 
Sun Ffan ears: It is not getting 
its way, but it isTpromoting its 
arg uments . It is stringing the 
rest afus along, 'squeezing the 
last drops of advantage out of. 
fo g declffT ^ tinn A. small minor- 
ity party both north and south, 
it has repeatedly foiled at foe 
ballot box. hi. general elections 
in 1992 it won less than 2 per 
cent of foe; vote in foe Irish 
republic andless than a tenth 
of the vote' in . Ulster. That is 
— : barely a third 


sand delegates If Adams Cannot £ the potential 
attended the ... . Catholic turn- 

Sinn F&in con- 8® Cameras, cut. Recent 

ference in Dub- they will m me to opinion polls 
tin at the week- . . J rrj„ suggest that 

end. The D™* ™S ability to ^ overwhelm- 
proceedings at- say His voice may ing majority of 

not be heard in 


tracted 260 jour- nnt 
nahsts from all Uv . 

parts of the Britain 

world. Mr 

Adams’s leng- P erroi 

thy addrw^ K wan 

peppered with protestations of 
a desire for peace. He said that 
3^90 lives had been lost in “the 
war” since 1969. Hie calculated 
that the IRA was responsible 
for precisely 53 per cent of foe 
total ripflfh j* Ris striking arith- 
metic omitted only foe few 
words necessary to end the 

killing 

Mr Adams had asked for 
“clarification” of the Reynolds- 
Major declaration. The Irish 
prime minister had responded 
amply; his British counterpart 
not so. Yet Mr Major did his 
best in an article in the Irish 
News last Friday. Mr Adams 
wants Britain to “persuade” 
the Protestants to join a united 
Ireland; Mr Major cannot 
agree. Would the same be true 
of a Labour prime minister? Mr 


Bri tain helps his 
performance 


<xar«1 .‘n Ms 11 P«Pte 

eara . *** want the vio- 

elps his . Ignra to wid. 

nsmra ^ Adams 
Qance protests that 

Sinn F6m is not 
foe IRA, but if he ti«d no influ- 
ence over the latter there 
would be no reason to pay 
attention to him. His tiny 
party has been out in the cold, 
gwfoidg fl fr om democratic poli- 
tics by Its relationship with the 
men ol violence- Now it is a 
player on the international 
stage, the subject of respect- 
ablesounding discourse, albeit 
at aim’s length, with the two 
prime ministers who carry 
responsibility for the future 
shape of Ireland. 

There was a further setback 
yesterday. Mr Major, with wob- 
bly support from Mr Reynolds, 
has been careful to maintain 
foe acquiescence in the whole 
strategy trf the principal union- 
ist party. By not opposing it, 
the Ulster Unionists, led by Mr 


LETTERS TO THE EDITOR 


Number One Southwark Bridge, London SEI 9HL 

Fax 071 873 5938. Letters transmitted should be clearly typed and not band written. Please set fox for finest resolution 


No rationale for price controls (Prime time 


From ' Dr William Wallace : 

Sir, Christopher Johnson’s 
summary of the National Com- 
mission on Education's propos- 
als (Personal View: “Lesson in 
maximising human capital”, 
February 23) proposes to intro- 
duce market principles to 
higher education funding, 
through recouping some of the 
additional earnings which suc- 
cessful graduates can hope to 
make in later life. I am puzzled 
that he should stumble over 
his logical mncluslnm, uni- 
versities should in turn be 
allowed to charge students 
what foe market will bear. 

The government’s current 
resistance to “top-up” fees, 


which Mir Johnson supports, is 
an oddly socialist position. “It 
would.” be tells us, “avoid tire 
most sought-after universities 
using the scheme.. .further to 
enhance their relative advan- 
tage.” But he offers no ratio- 
nale for this imposition of price 
controls, which Is likely in foe 
long run to level down the 
quality of the best universities 
through limiting their abffify 
to raise income to match their 
necessarily higher expenditure. 

The impression given is of a 
poorly thought-out tactic 
Intended to avoid protests from 
middle-class Conservative vot- 
ers. without considering its 
nti pWnatifln s for higher educa- 


tion strategy. Does the govern- 
ment want good universities to 
get better - or does it wish to 
level down to a uniform pat- 
tern of mass higher education? 

ft market principles are to be 
applied, there is no case for 
government regulation to 
impose uniform fees across 
almost too universities, ft Gat- 
wick Express is allowed to 
charge more for getting people 
there faster than Network 
South-East, there is no justifi- 
cation for refusing to allow 
Oxford to charge more for 
offering a premium service, 
w iiiiam Wallace. 

St Antony's College, 

Oxford OX2 6JF 


for private 
funding 


Capital reform 
for Lloyd’s 


From Mr J H Murray Willis. 

Sir, Reform is due for the 
Lloyd’s method of allocating 
I capital to syndicates by queue- 
ing or, to quote the Lex col- 
umn (February 19), granting of 
“grace-and-favour indulgence”. 
Its replacement with the adop- 
tion of a value/trading system 
for syndicate shares would 
bring an improvement in effi- 
ciency of the market for the 
benefit of all Lloyd’s investors. 

Corporate members, whose 
share prices reflect value for 
their 1994 account syndicate 
participations, have no 
grounds for objection to this. 
Indeed, foe greatest benefit 
professional corporate inves- 
tors can bring to. Lloyd’s is the 
demand for the Introduction of 
further investor rights enjoyed 
in other capital markets. 

J H Murray Willis, 

Oakwood Underwriting 
Agencies, 

SS Oracechurch Street, , 

London ECS OBH 


Case for stricter accounting 
of German corporations 


Prom Mr Thomas Hein, 

Sir, With reference to John 
Craven’s article (Management: 
“Testimony to the German sys- 
tem”, February 18). enthusiasts 
of the German model of corpo- 
rate governance have long 
praised the system for its alleg- 
edly superior long-term perfor- 
mance. Mr Craven, chairman 
of merchant bankers Morgan 
Grenfell, a Deutsche Bank sub- 
sidiary, now eiflmm that the 
German model merits praise 
for its superiority against oth- 
ers with respect to its capacity 
for short-term hanriirng- of cor- 
porate failure, like the one that 
occurred at Metallgesellschafi 
AG. 

What Mr Craven can book as 
a natural advantage in foe suc- 
cessful rescue of MetafigeseUs- 
chaft AG is seen by many in 
this.country as the cornerstone 
of an organised system of 
unacoountabnity that has cre- 
ated much of the rigidity and 


stagnation that we face in Ger- 
man society. The talk here is of 
foe virtually closed and highly 
centralised system of decision- 
making in the German model 
of corporate governance. 

There is an urgent need to 
mid foe cosy relationships in 
German corporatism and to 
remind everyone of the individ- 
ual responsibility owed to a 
business. It is not acceptable 
that public banks, as occurred 
in the rescue of MetafigeseDs- 
chaft AG, are actively engaged 
in seenring the gambling risks 
of badly controlled managers 
from private corporations. 
Since the current German 
model of corporate governance 
seems to be built on weak 
moral grounds you should not 
be surprised to hear more ener- 
getic calls for stricter account- 
ing rules. 

Thomas Hein 
Lehrter Strasse 50 
10557 Berlin 


From Mrloor Kerma. 

Sir, Your editorial comment 
("Private finance", February 
25) says that private finance 
for public capital projects has 
yet to show any real progress. 
Institutional Investors prefer 
stock exchange securities with 
proven track records. 

A framer president of the 
Institute of Actuaries and chief 
actuary to the Prudential, 
Frank Recftogtrai, said, in a lec- 
ture an April 19 1977: “The net 
amounts passing between 
industry and. long-term savings 
are smafi. To give teeth to the 
point, in the 11 years 1965-75, 
industry raised £6bn in new 
long-term capital, but it repaid 
£5%bn in cash acquisitions 
(takeovers, trade investments, 
etc). The net requirement of 
£%bn compared with the 
growth of £24bn in institu- 
tional funds over the same 
period.” 

The £23%bn went Into the 
purchase of already existing 
stocks and shares. It could not 
affect the income-earning 
potential of the underlying 
companies at alL If this money 
had gone into public capital 
projects, foe country could 
have had new road and rail 
systems, the second Severn 
Bridge, eta The institutions 
would have had the income 
from all these projects. 

A similar situation exists 
today. There is no time to lose 
in investigating the posxtion. 
As the Labour party document 
points out, “there are plenty of 
competing capital projects at 
home and abroad" (my empba- 


Ivor Kenna, 

72 Compton Street, 
London BClV ABN 


Belief, claims and facts on the Catholic Church 


From Mr Norman William 
Smith Jnr. 

Sr, So many mis-statements 
are contained in foe Very Rev 
Hugh Dickinson's article, “Not 
all roads lead to Rome” (Febru- 
ary 12). 

His claim of a “steady 
stream” of American Catholics 
into the US Protestant Episco- 
pal Church conflicts with that 
denomination's documented 
loss of almost one-third of its 
membership over the last 
decade. 

His assertion that “the 
bodily assumption of foe Vir- 
gin Mary into heaven is a 
belief necessary for salvation” 
misrepresents the role of 
dogma in foe Catholic Church. 
He coins the phrase “Papal 
fundamentalism” (without 
even bothering to define the 
term) and then darkly equates 
it with “biblical ftmdamental- 


ism”. Is it really “equally 
oppressive” to be asked to 
believe: a) that Gad preserved 
the body of the Virgin Mary 
from earthly corruption, and b) 
that God created the world in 
six calendar days? 

He characterises the Papal 
ban on contraception as an 
“outrage against conscience 
and reason and is known to be 
by the majority of Roman 
Catholic lay people and 
priests” . True, a majority of 
Catholic laity appears either to 
dissent from or otherwise to 
disregard the teaching; but it 
can only be a small, small 
■minority that characterises it 
an “outrage”. 

Dr Dickinson attributes the 
stability of faith in the Catho- 
lic Church to an “absolute 
authority. .. [that] can never 
admit that it was wrong”. But 
this overlooks the more 


point that , if Christ’s toarhing g 
on Earth and morality are them- 
selves authentic, and if one 
believes that Christ protects 
“the Omrcfa” from “error”, one 
would assume a fairly consist- 
ent and uniform Interpretation 
down through the centuries, 
whether or not Us structure 
was “authoritarian”. 

Whenever any man, theolo- 
gian or scientist, changes his 
views, he necessarily begs the 
question: were you right then 
or now? For a “church” to den- 
igrate the beliefs of its ances- 
tors in faith can only prompt 
foe same, question. 

Organised religion, whether 
Christian or otherwise, has 
been characterised as a union 
of faith, morality, and liturgy. 
True, one can identify 
"churches” which trivialise 
faith and morality. Shinto pres- 
ents the best case. But the 


American experience suggests 
that foe “market” for such.a 
“church” is extremely «wt«Ti- In 
iWttriTriflhfog the im p ortance^ of 
belief and morality, the Angfe 
can. Church is pursuing a 
“market niche” of sma ll dimen- 
sions. A liturgy, regardless, a 
how “Catholic", will not:sufr 
tain its m e mbership. 

Finally, as In an earlier 
on Bishop David Jhnkins, he 
betrays a deep, antipathy, to 
any “faith* not buttressed .hr 
demonstrable scientific .eyl* 
dance. 

But how different fofa fa 
from foe attitude of C hrist • 
TThnarff, for whom “faith” «s 
superior to verified knowledge 
(John 2029). 

Norman Wflhflm Smith ton 

118 Woods Lane. 

Radnor, 

Pennsylvania 19087, - - 

US 


^ , ip 

..i ' 1 1 


James Molyneaux, have kept 
the so-called peace initiative 
afloat In so doing he has 
listed losing the votes of his 
natural supporters: Yesterday 
Mr Molyneaux pointedly 
rejected the notion of multi- 
party talks at which represen- 
tatives erf his party and of Dub- 
lin were both present He pre- 
fers to get on with the 
establishment of an Ulster 
assembly which, once elected, 
could do the talking. One 
strand of the Londou-Dublin 
strategy has thus been 
snapped. It may eventually be 
restored. Meanwhile such 
unionist posturing helps make 
Mr Adams's paint far him 

In Irish eyes foe above pic- 
ture may seem less dismal 
than it does in London. The 
- real debate may be within Sinn 
FfeJn. The leaders of the latter 
are masters of delay, hut they 
need time in which to extract 
what they can from the two 
democratic governments. 
Then, say the starry-eyed, they 
will call a ceasefire. Only 
unio nist impatience, or emo- 
tional outbursts by influential 
Tory backbenchers, could 
upset that timetable. Perhaps. 
.Meanwhile London and Dublin 
will search for amove they can 
make on their own. It could be 
hard to find. 

There is no case for with- 
drawing foe Major-Reynolds 
declaration, which is a state- 
ment of principle that removes' 
all props from the arguments 
favouring violence. Talking to 
Ulster’s democratic' parties 
about a devolved assembly was 
made more difficult by Mr 
Molyneaux yesterday, but it Is 
not impossible. Publishing the 
proposals worked up by Mr 
Adams with Mr John Hume,, 
fhft loader of tll fi mainly CafoO - 
tic Social Democratic and 
Labour party might help. What 
else? Wrimin and Ireland . can 
only wait for peace. They 
have waited 25 years. How- 
ever awful, they could with- 
stand another. 


Vs in* 


Slli 4 * 


: lied 


:-°«k T(J( 






FINANCIAL TIMES TUESDAY MARCH l 1994 


17 


\ 


£ 

P 

R 

ti 

be 

se 

en 


FINANCIAL TIMES 

Number One Southwark. Bridge, London SE1 9HL 
Tel: 071-873 3000 Telex: 922186 Fax: 071-407 5700 

Tuesday March 1 1994 

Russia’s move 
in Bosnia 


I It was strangely obliging of the 
: Bosnian Serb airforce to provide 
i Nato with such a clearcut casus 
belli 

Had the Serbs rejected last 
month's ultimatum, or resumed 
shelling Sarajevo after the ultima- 
tum expired, Nato would have had 
to launch air strikes against Serb 
weapons in order to retain any 
credibility. But by doing so in the 
teeth of strong Russian warnings, 
it would have risked a very seri- 
ous crisis both on the ground and 
in the UN Security Council. 

As it was. both the Serbs and 
Nato were spared that confronta- 
tion by the Russian intervention. 
That left an ambiguous situation 
in which no one was quite sure 
who had won. Now, by a flagrant 
violation of the no-fly zone, the 
Serbs have allowed Nato to estab- 
lish its credibility unambiguously, 
but aisn in circumstances of indis- 
putable legality. Last March the 
Security Council explicitly author- 
ised “member states . . . acting 
nationally or through regional 
organisations or arrangements'’, 
to use force against aircraft violat- 
ing the NFZ. 

Russia voted in favour of that 
resolution, and yesterday the Rus- 
sian foreign ministry supported 
Nato’s action, while awaiting 
“clarification" of the aircraft’s 
identity, which the Bosnian Serb 
command has tried to disclaim. 
Thus the Serbs appear to have 
embarked on a strategy of escala- 
tion without bothering to secure 
the support of their Russian pro- 
tectors. 

Already involved in a joint 
onslaught with the Croats on the 


Moslem enclave of Maglaj. yester- 
day they also launched an intense 
heavy artillery attack on the town 
ofTuzIa and its airport, which the 
UN is hoping to reopen next Mon- 
day. In addition, their chief of 
staff. General Manojlo Milova- 
novic, said he would use weapons 
against aid convoys if the UN 
commander. General Sir 
Rose, acted on his decision to send 
them through Serb lines under 
armed escort without applying for 
Serb permission. 

All these actions are clear prov- 
ocations to both the UN and Nato. 
particularly the shelling of Tuzla 
(supposedly one of the UN’s “safe 
areas") and its airport Reopening 
the airport was the object of 
Nato's last ultimatum but one - 
though it was Inexplicably emit- 
ted from the more recent one, the 
first to set a specific deadline. 
Nato is unlikely to react with 
immediate air strikes, but Gen 
Rose may well call for air support 
if Gen Milovanovic carries out his 
threat to attack UN-escorted con- 
voys. 

The Serbs are probing Nato. but 
thereby implicitly also testing the 
limits of Russian support This 
may actually he usefiil to Nato, 
which needs to know how ter it 
can count on Russia to moderate 
Serb behaviour. The correct 
response for Nato at this stage is 
to hold back from further air 
strikes witem the provocation is 
very direct (farther violations of 
the NFZ, or renewed rfidiing of 
Sarajevo), while asking Russia to 
use its influence with the Serbs so 
that further ultimatums are not 
necessary. 


Some hedge 


Hedge funds make splendid 
scapegoats for the recent turbu- 
lence in global markets. But is one 
of the unstated risks in their fre- 
netic and highly leveraged 
operations that their importance 
Is being exaggerated? 

The sige of the foreign pxrhangp 
market is such that it seems 
implausible that even Mr George 
Soros of Quantum Fund Tame 
could have extracted sterling from 
the exchange rate mechanism sin- 
glehanded - and we only have Mr 
Soros's word for the amount of 
profit he made in speculating 
against sterling. II rumours of 
huge bond market losses among 
the hedge funds in recent days are 
true, the main victims, apart from 
the managers, will be rich individ- 
uals who knew what risks they 
were taking when they entrusted 
their money to these off-shore buc- 
caneers. At first sight, then, it 
may seem odd that the Bank of 
England, whose concern in these 
matters is primarily to do with 
systemic ride, should be looking 
into the issue. 

Yet the central bankers cannot 
afford to ignore the likelihood that 
hedge tends are often the counter- 
parties of the commercial banks. 
In that sense they may be systemi- 
cally important. And the only 
undisputed facts about these pri- 
vate pools of capital is that their 
managers borrow to speculate, 
while revealing little information 
about their financial activities. 

Much of what they do takes 
place not in the cash markets but 
in derivatives. This, too, is an 
opaque and highly leveraged part 


of the global securities system, 
since much of the dealing takes 
place in over-the-counter markets. 
The precise location and extent of 
the risk is not always easy to iden- 
tify. There Is thus obvious scope 
for the kind of problem that arose 
with the collapse of the Herstatt 
bank in the 1970s or with the diffi- 
culties of Drexel Burham In the 
1960s. where central bankers felt 
obliged to help close out the US 
investment bank’s positions. 

Estimates of hedge fund capital 
range from $30bn to $80bn. With 
leverage, that could readily imply 
that they are taking positions in 
the markets of $500bn upwards. 
But since there is no adequate def- 
inition of the genus, it may be 
that such informal industry esti- 
mates overstate the sums involved 
by including tends run by more 
conventional managers. 

The Immediate need is clearly 
for Information about counter- 
party risk in the commercial bank- 
ing system, in order to establish 
how the banks are controlling 
their exposure to the hedge funds. 
If the exercises now being con- 
ducted in Britain and the US indi- 
cate that the risk is exaggerated, 
so much the better. If not, and the 
data permit, the case for toughs: 
capital requirements within the 
existing capital regime of the 
Bank for International Settle- 
ments will be overwhelming. 
Where rich individuals are being 
seduced into speculative mania by 
hedge fund gurus whose creden- 
tials remain obscure, it seems all 
too plausible that the world's 
bankers wll] not be ter behind. 


New-look TUC 


Greater than the 
sum of his parts 

Can HSBC Holdings persuade doubters 
in the City that global commercial 
banking makes sense, asks John Gapper 

HSBC Holdings:. thinKing globally 





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executive of Midland Bank from 


S itting in his office over- 
looking the muddy 
Thames, the chaimum of 
Britain's second most 
valuable company vents a 
characteristic flash of irritation at 
the stockbrokers massed behind 
him in the City. “The first view was 
'Here is this bank from Asia. They 
have got these huge profits, hut 
look at their track record in Austra- 
lia, look at America. They can’t 
manage any bloody tiling.' Well, my 
team and I have got to pro ve th ose 
detractors wrong," says Sir WflHam 
Purves. 

For most of his working life, the 
62-year-oid expat ri ate Scot did not 
have to worry overmuch about City 
institutions. The chairman of the 
Hongkong and Shanghai Bank 
answered only to the retail Inves- 
tors of Hong Kong and a s u pp ortiv e 
board, whose non-executives tradi- 
tionally came Cram the UK colony's 
trading companies. "Going back a 
few years, I don’t suppose I looked 
at the bank’s share price more than 
once a month, or something." says 
Sir w illiam , with a touch of nostal- 
gia. 

Bui thing* have changed s focy 
the Rank of Rn gfan^ Imrinteri flint 
Sir William shift his headquartas 
from a glamorous tower by TTnng 
Kong harbour to an undistin- 
guished blue-tinted block near 
Tower Bridge. The £3Abn acquisi- 
tion. of Midland Bank - the fourtb- 
largest UK clearing bank - in a 
contest with Lloyds Bank 18 

months ago not only transformed 
Hongkong and S hang hai i nto a 
global banking group called HSBC 
Holdings, bat exposed it to unaccus- 
tomed scrutiny. 

After a series of flawed attempts 
to diversify its retail hanking activi- 
ties around the world in the i ftffls , 
the boom in its south-east Asia base 
combined with the Midland acquisi- 
tion has given Sir W illiam a ohanoa 
to lay the doubts to rest before he 
retires. To do so, he must not only 
show that HSBC’s core of 400 senior 
manag nrs can inn hanka aro und flu* 

world competently, but demon- 
strate, against conventional wis- 
dom, that the concept of a global 

Commercial hank mairpe Mm go 

The 51 per cent rise in HSBC's 
pre-tax profits for 1993 to £2.6bn. 
announced yest erday , is a stage in 
this process. Sir W illiam is expected 
to retire in 1995, although it could 
be later, and has set himself a sin- 
gle task before he goes. *T would 
like to see the jury not being out, I 
would like to see some credibility," 
he says. “It is not going to be easy 
because the years ahead may not be 
so easy for hanks. But I would like 
to see some of the question marks 
about HSBC Hnldingg lifted." 

The initial doubts he had to dispel 
were among Midland shareholders, 
who not only had more inst in ct i ve 
respect for the managafnant record 
of Mr Brian Pitman, chief executive 
of Lloyds Bank, but were not eager 
to swap their Midland stakes for 
HSBC paper. “The people running 
the UK tends said: Tf I'd wanted a 
stake in a global bank, I would have 
boug ht if ," says Mr George Car- 
dona, HSBC's bead of planning. 

Those sharehold ers a re convinced 
- for the PMmpfit HSBC has gained 
from the hunger for p merg in g mar- 
kets ghv» the acquisition or Mid- 
land cm July 10 1992. HSBC’s shares 
have risen from 4T7p each to yester- 
day's dose of 945p. But the difficult 
part is still to come. The group 
must make the other parts of its 
business work, by redressing the 
imbalance of holding 40 per cent of 
its assets in south-east Asia, while 
deriving £1.9bn - or 75 per cent - of 
pre-tax profits from the region. 

Although the largest investment 
banks such as Goldman s»rKc and 
Morgan Stanley have developed 
operations around the world to 
channel cross-border flows of capi- 
tal, there are few contenders to 
become global commercial banks. 
After the losses sustained in the 
1980s by banks which tried to 
expand overseas fay lending to big 
companies at narrow wiargiwi or 
buying small retail hanks in other 
countries, most banks have 
accepted that they are more suc- 
cessful sticking to the home mar- 
kets in which they are strong. 

The exceptions are European 
banks such Deutsche Bank and 


60UCKHB8C 

Credit Lyonnais, which still have 
ambitions to build cross-border 
retail franchises, and Citicorp, the 
US bank which has a strong retail 
business in many e m e r g in g markets 
suite as T.arin America. But HSBC 
has managed its portfolio of banks 
differently. Instead of farming a sin- 
gle bank, it has allowed the man- 
agements of hankq such as Marine 
Midland in New York and Hong- 
kong Bank of Canada to T im them 
independently. 

HSBC’s attempts to expand inter- 
nationally go back a long way. It 
always had an international out- 
look, because it was formed to 
finance trade out of the s outh-east 
Asia in 1865. But Sir William dates 
the decision to do more than estab- 
lish overseas offices from the 1970s. 
“We believed that if we just sat as a 
strong regional bank, we would be 
swallowed up by a Japanese or an 
American bank. We thought there 
was an opportunity for a Hong 
Kong bank to expand into a big 
fellow, " he says. 

By the late 1980s, Its method of 
doing so looked disastrously ineffec- 
tive. HSBC’s directors were particu- 
larly chastened by Marine Midland, 
which they fully acquired in 1987. It 
sustained losses of 8720m between 
1987 and 1991 after its US managers 
tried to turn it from a regional bank 
in New York state into a rival to 
Chase Manhattan and Citicorp. Sir 
William watched from the sidelines, 
because HSBC had agreed to allow 
Marine Midland autonomy as the 
price for acquiring a US bank. 

It was a frustrating period for a 
naturally impatient man, made 
worse by the fact that HSBC's small 
Australian subsidiary was also los- 
ing money. US regulators and HSBC 
eventually decided enough was 
enough, and a team of HSBC direc- 
tors took over. Marine Midland 
returned to its regional bank role 
and recovered to a $173J2m pre-tax 
profit last year. The team included 
Mr Keith Whitson, who is taking 
over from Sir Brian Fearse as chief 


next mnnfh 

Mr Whitson says HSBC learnt a 
lesson from Marine Midland, 
“dearly, with the benefit of hind- 
sight, we kept our hands far too 
much off the tiller. We did nnt man- 
age to get the management there to 
become part of the group. They paid 
lip service to it, b ut they did not do 
it," he says. HSBC tires not intend 
to make a similar mistake with Mid- 
land. It has already merged HSBC’s 
and Midland's treasury operations, 
and is working on plans to improve 
Midlan d's technology. 

The most obvious symbol of the 

group’s datm inmatin n not to delay 


Other banks say 
Midland has emei^ed 
as the high street 
bank most willing 
to lend money 
to small business 


in getting to grips with Midland is 
the retirement of Sir Brian, a wall- 
respected hanker brought in by the 
Bank of England to rescue Midland 
at the height of its bad debt and 
m a na ge m e n t problems In 1991. Sir 
Brian was thought by same to be a 

ffanriiriflt * as Midland chairman , 
Although HSBC directors talk of Sir 
Brian’s achievements admiringly. 

Sir W illiam is taking on file Mid , 
land chairmanshi p himself. 

Strengthening Midland, and 
returning it to something closer to 
its glory days in the 1960s as the 
largest UK bank, is crucial to Sir 
William’s task of proving that 
HSBC can manage b usinesses wen. 
He believes there is room for 
improvement 

“British high-street banking has 
developed more slowly than in 
other places. In many countries in 
Asia. I think that the customer has 
a much better service, 9 he says. 


HSBC directors believe that both 
technology and staff training need 
to be improved. 

Apart from im provin g service to 
personal customers, HSBC is trying 
to rebuild Midland’s lost market 
share rn landing mone y tn, and han- 
dling cash for. small companies. 
Other banks say that Midland has 
emerged as the high-street bank 
most willing to lend money to small 
businesses ginop it acquired HSBC’s 

hacking 

“We want that image, as loog as 
we do not get the reputation for 
throwing money at people without 
assessing the risks properly. We are 
looking for business," says Mr Whit- 
son. 

Attracting more business from 
large companies has, initially at 
least , not been too difficult. The 
HSBC takeover has given Midland 
the backing of a parent company 
With a lot Of capital, which maTrew 
big companies feel safer. HSBC’s 
influence makes it a more natural 
choice for European companies 
trading in south-east Asia. “We 
have gained quite a lot of corporate 
business from across tire Channel 
whiph would never have came to 
Midland previously," says Sir Wil- 
liam. 

But HSBC has a long way to go 
before it rivals US banks like JP 
Morgan in providing a range of 
financial services, including the 
underwriting and distribution of 
securities for big companies as well 
as lending to them. This would 
require it to integrate commercial 
banking better- with global invest- 
ment hanking. Investment banking 
activ ities made a pre-tax profit of 
£253m last year, and remain a poor 
cousin of the group’s myfo banking 
business. 

HSBC saw the logic of shifting its 
balance of business towards Invest- 
ment banking in the 1980s when it 
acquired James Capel, the London- 
based equity broker, to add to its 
WarcQey merchant hanking arm in 
Asia. But before It took over MLd- 


Founded in 1868, Britain's Trades 
■ 'm Congress is "relaunching" 
"he need is for a new prod- 
-r than new wrapping, 
last decade, the trade 
nent’s central body 
’Td, has generated 
found no takers 
style bureau- 
’e voice of 
•eminent 
inch is a 
■ese fects. 
leral sec- 
lrganisa- 
on, but 
hostile 
trade 
thus 
es - 
add 
has 

lin- 

es 

o- 

e 


parties other than Labour at the 
last election. 

But to justify its existence a 

trade iininn centre. Ilka a national 
employers’ organisation, needs to 
contribute expert and constructive 
views to the public policy debate 
about workplace issues, and to 
lead rather than just reflect the 
dialogue within its member organ- 
isations. 

Mr Monks needs to make a 
splash on issues like flexible 
labour contracts, the changing 
shape of public sector employment 
and the need to control wage Infla- 
tion in the economic recovery. 
These are all controversial mat- 
ters within TUC-affihated unions. 
Although Mr Monks rep rese n ts a 
return to the quiet, technocratic 
style of Len Murray, individual 
unions resent being lectured by 
the TUC and some are already 
uneasy at the speed of the current 
reforms. The emergence of the 
super-unions - such as Unison in 
the public sector - may compound 
the problem as these organisa- 
tions acquire larger political ambi- 
tions in their own right. 

The broader difficulty underly- 
ing the relaunch is the lack of a 
clear concept of modern trade 
ntonism. The need Is for a trade 
nionism that transcends collec- 
ism, but which makes an asser- 
; contribution to fostering a 
but efficient framework of 
ir market regulation and cor- 
■ law at a time when smaller, 
’-sector enterprises are of 
ing Importance. If Mr 
ils. the TUC may well be 
have had its day. 


Going forth 
to multiply 

■ If the European Central Bank 
has yet to pick a figurehead to 
engrave on its banknotes, it could 
do worse than Mayer Amschel 
Rothschild, whose birth 250 years 
ago in FrankfUrt was yesterday 
being celebrated by a gathering 
of the clan in the German financial 
capital. 

That at least was the respectful 
opinion of the town's mayor after 
listening to the encomium delivered 
by Lord Jacob Rothschild to the 
founder of the eminent banking 
dynasty. 

The English Lord related how 
Mayer Amschel built up a 
prototypical European Union when 
he sent out five of his sons on their 
famous journey from Frankfurt’s 
Jewish ghetto to European capital 
cities. 

“He had a virion of a network 
of European countries collaborating 
and improving their communal 
lot," Lon! Rothschild recalled, 
squeezing in a quote from an essay 
penned by his Aunt Mi riam 

As was readily apparent, the 
clan's knowledge of the lingo of 
western Europe’s largest country 
is virtually non-existent, and the 
group’s axis is indeed firmly 
Anglo-French. The German b ranch 
of the family died out in the early 
years of the century, and the family 
had no presence in Frankfort until 
a qnall office was opened in 1989, 


which today has fewer than 10 
professionals on its staff. 

After Chancellor Kohl and retinue 
helped crown the proceedings last 
night at the Jewish museum, it 
must surely be one of the most 
feted outposts in the world. 


Programme change 

■ The English National Opera is 
interested in some of your cash 
- £250,000 to be precise - to help 
fund this season. Its appeal leaflet 
promises eight new productions, 
including Tosca by . . . Verdi. Oops. 
A last-minute sticker correctly 
credited Puccini. 


Gaijin clubs 

■ What do the J-League - Japan's 
football league launched last year 
- and the country's stock market 
have in common? 

It seems neither can thrive 
without gaijin - foreigner - 
support 

The J-League is now a huge craze, 
but Us stars are foreign players 
from South America inri Europe 
Similarly, the real players behind 
this year’s near 15 per cent rise 
in the Nikkei stock index are US 
and European buyers. A record 
312tm in overseas funds was 
pumped into the Tokyo stock 
market in January alone. 

Which craze will pass first? While 
Japan’s football teams ore happy 
to rely on foreign players, some 


Observer 



HrBlobbyT 

xenophobic financial authorities 
are starting to worry about what 
happens when the foreigners stop 
buying. 

They can “guide" Japanese 
institutions when to buy or sell, 
but gaijin investors can’t be pushed 
around like Foreign football stars. 
Wen, not yet anyway. 


Twit to woo 

■ Is it wise of Guardian Royal 
Exchange to drop Royal Exchange 
from its title? Puzzled investors 
might wonder whether they are 
dealing with the insurance group 
or the newspaper. 


Changing its symbol from the 
GRE logo to an owl might also 
arouse consternation. The owl is 
intended to connote “stability, 
wisdom friendliness - all of 
which are very important to us”, 
says the insurer’s press release. 

Let’s hope it doe sn't a lso indicate 
a preference for daytime napping. 


Snow kitty 

■ IPs an ill snow-blizzard which 
blows nobody any good. Despite 
the Arctic conditions in the US. 
at least (me industry is thriving. 

Kitty litter has become such a hot 
commodity that even America's 
non-cat lovers can no longer do 
without it 

People are buying tire staff to 
spread over slippery sidewalks; 
apparently it’s an environmentally 
friendly alternative to the more 
traditional rock salt, itself in short .. 
supply. 

Drivers are loading up with 5(Hb 
sacks of the versatile granules to 
give their cars better traction in 
snow. Grocery chains are shifting 

twice as much litter as normal, 
according to Supermarket News. 

And of course, cats are staying 
indoors. 


Blade runner 

■ John Major’s trip to Washington 
and the rumpus over tife Thatcher 
Collection raises the question of 
the ownership of gifts received by 


land - and with.it Samuel Montagu, 

the merchant i«mfc — flip invest- 
immf banking businesses operated 

separately from each, other and 
from the commercial banking side, 
and were ineffective. “We had a 
rather motley crew all doing differ- 
ent things, and not co-operating 
very much,” says Sir William. 

HSBC has now set its sights on 
creating a global investment bank 
under the direction of Mr Bernard 
Asher. He says HSBC has got the 
size and range of activities, that 
attract large companies to deal with 
its treasury and capital markets 
arms. “We started in a colonial 
cul-de-sac, and you do not get many 
large multinationals there. Once 
you become large and generate 
activity, multinational companies 
feel they have to deal with you,” he 
says. 

Yet HSBC has so for shied away 
from carrying out the fuD merger of 
its corporate advisory and equity 
underwriting arms with its broking 
and trading activities to create an 
integrated investment bank. This is 
a tacit acknowledgement of the 
weakness (tf its merchant banking 
operations. Integration would stop 
James Capel from offering broking 
services to other banks, and Samuel 
Montagu could not supply enough 
business to compensate. 

T he move to London has 
thus presented Sir Wil- 
liam and HSBC with 
twin challenges in creat- 
ing both an improved 
form of British clearing bank, and a 
global investment bank. Sir William 
says this was the reason HSBC's 
board decided he should remain at 
the balm after the official retire- 
ment age of 60. 

*T said to the board: T think it is 
an opportunity for me to retire. I 
would normally be retiring if this 
move was not taking place.’ I am 
afraid I did not get too much 
encouragement,” he says. 

But beyond the concrete task of 
forging new businesses lies the less 
tangible one of showing that 
HSBC’s management can add value 
to a diverse set of businesses. It is 
not just the past that provokes 
doub t, but the impression that Sir 
Wffiiam bhrwwif is so dominating a 
figure that the bank depends too 
much on his presence. Although he 
dislikes such talk, at times he 
appears almost single-handedly to 
have dragged HSBC into being as a 
global force. 

Critics say that, despite an enor- 
mous appetite for work and a formi- 
dable grasp of detail, he can be too 
impatient. They also question 
whether his gruff exterior and 
imposing presence have discour- 
aged the emergence of a successor. 
Until tire Bank of En gland insisted 
that the jobs were separated. Sir 
William was both chairman and 
chief executive of HSBC and, even 
now, it is difficult to imag ine him 
giving free ran to Mr -John Bond, 
the chief executive. 

As the. winter sunshine streams 
in, Sr William reflects on Ms repu- 
tation for ferocity. “I lead a meet- 
ing, some would say I dominate a 
meeting, but let me tell you that, if 
there is someone in my team who 
does not agree with what I am say- 
ing, I hope I listen to them. I believe 
I listen to them." He pauses a few 
seconds. “I don't like a long story, it 
doesn’t impress me having to listen 
to 15 minutes, and I sometimes say: 
‘Where’s the real meat here?’ " 

Some colleagues maintain that 
Sir William has tried to promote a 
new generation of managers. It did 
not always work, as be acknowl- 
edges. “There was a 10-year period 
when for one reason or another we 
did not seem able to get sufficiently 
good people, but we have got some 
excellent young people coming up," 
ha says. He insists that he will not 
delay his departure too long. “There 
is no way that one man can run a 
group iikg this. 

“Who knows when it will be time 
for me to go? Sometime soon, some- 
time soon I expect I don't see why I 
should go on working forever. 1 
believe that when the moment 
comes, it will be clear to me, but 
human beings sometimes don’t see 
it ifl d on't, erne of my team will say 
to me ‘Willie, time to go.’ And I'll 
be oft” 


national leaders during their time 
in office. 

Harry Truman took a 

characteristically simple view. 
Introducing Ms 1973 biographer 
Merle MlDer to the part of the 
Truman Library, in his native 
Independence, Missouri, that was 
devoted to such gifts, he observed: 
“They were given to the president 
(tf the United States, which is what 
for a time, I was, but I never 
thought they were for my personal 
use." 

But there was one exception: 
a jewelled sword, from King. Saud 
of Saudi Arabia. Truman explained: 
“I told Bess [his wife] Td give that 
to bar if she’d Mrifr Brick er [a 
Republican senator from Ohio] in 
the ass, but she wouldn’t do it So 

it’s still here.” 


Stony ground 

■ Lloyd’s Names have been weeded 
out In more ways than 
according to the latest edition of 
the Good Gardens Cidde. 

Among gardens dropped from 
the new edition are a sprinkling 
belonging to Lloyd's Names, 
battered by their recent losses. 
Compilers Graham Rose and Peter 
King gloomily write: “If the 
mid-1960s were the years of the 
gales, the mid-1990s may be the 
years of the Names, forced to 
reduce expenditure on fine 
gardens." 

After all, money doesn’t grow 
on trees... 



18 


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PLO calls 
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pressure 
on Israel 


EU makes eleventh hour 
effort on enlargement 


By David Gardner In Brussels 

Strenuous efforts were being 
made in Brussels last night to 
salvage negotiations to get Fin- 
land, Sweden, Austria and Nor- 
way into the European Union by 
next year. 

The ostensibly final round of 
talks looked set to move yester- 
day's midnight deadline into a 
fifth day today as it seemed cer- 
tain that Austria and Norway 
would be unable to agree entry 
terms by midnight 

The EU member states, meet- 
ing internally before presenting 
the candida t es with a final pack- 
age. were faced with either set- 
tling early entry terms for Swe- 
den and Finland, or adjourning 
the negotiations for a few days 
before reconvening - at full for- 
eign minister level or even at a 
summit of heads of government. 

Mr Klaus Kinkei, the German 
foreign minister, joined the nego- 
tiations yesterday with a plea for 
flexibility on both sides to get all 


four applicants into the Union. 
Enlargement, he said, was much 
more important than arguing 
over access to a few thousand 
tonnes of fish, an allusion to 
Spanish demands for access to 
Norwegian fishing waters and 
French attempts to restrict 
access for Norwegian fish to the 
EU single market, one of the 
mnin sticking points in the talks. 

Germany, the ElTs main pay- 
master, also warned that enlarge- 
ment was part of the arrange- 
ment the 12 reached at their 1992 
Edinburgh summit, which agreed 
the 1994-09 EU budget resources, 
including a doubling of aid to 
poorer countries like Spain. Por- 
tugal, Greece and Ireland. 

EU diplomats revealed that Mr 
Felipe Gonz&lez, the Spanish 
prime minister, had written to 
Chancellor Helmut Kohl of Ger- 
many to spell out Madrid's Anal 
demands. Though Spain still 
insists Norway can not be 
allowed a better deal on fish than 
the limited agreement Spain and 


Portugal got when they joined In 
1986. Mr Gonzalez made clear he 
will not countenance significant 
change to the ElTs weighted 
majority voting rules to accom- 
modate the newcomers. 

Spain, along with the UK, 
wants to preserve existing 
"blocking minority*’ rights. 

The European Parliament, 
wants to make It even more diffi- 
cult for member states to block 
Euro-laws. Failure by the 12 to 
agree on voting could prevent a 
dea l, boiling up simmering differ- 
ences between small and big 
member states which could alien- 
ate public opinion among the 
small newcomers. 

The EU was poised last night 
to offer Norway a compromise 
deal on fish which allows Oslo 
keep control of Its waters for a 
period, in exchange for consoli- 
dating existing access arrange- 
ments. EU negotiators, however, 
said there was little indication 
that Norway was prepared to 
negotiate. 


Bonn steps up pressure on 
Elf to build refinery in east 


By Christopher Parkas in 
Frankfurt, John Ridding In Paris 
and Quentin Pad in Bonn 

The German government and 
privatisation authorities yester- 
day stepped up the pressure on 
Elf Aquitaine, the French energy 
group, to honour a contract to 
build a showpiece oil refinery in 
Leuna, eastern Germany. 

Failure to go ahead could cost 
Elf DM1.5bn ($850m) in breach-of- 
contract penalties, and oblige it 
to give back a chain of more than 
600 east German petrol stations, 
warned Mr Klaus Schucht, a 
senior official of the Treuhand 
privatisation agency. 

Although a Treuhand spokes- 
man stressed Elf had not been 
served with an ultimatum, and 
that discussions were continuing, 
interventions by Chancellor Hel- 
mut Kohl and Mr Gtinter 
Rexrodt, economics minister, 
underlined Bonn's anxiety about 
the project 

The passing of the agreed dead- 
line yesterday for a start on con- 
struction work brought the row 
to a head. Government officials 


confirmed that Mr Kohl had writ- 
ten to Mr Edouard Balladur, 
French prime minis ter, while Mr 
Rexrodt said the government 
insisted Elf should fulfil its con- 
tractual obligations. 

Mr Rexrodt maintained that 
the risk of losses in the start-up 
phase was not a good enough rea- 
son for withdrawal since Elf 
seemed to believe the project 
would be profitable in the long 
term. 

The French company, commit- 
ted to two-thirds of the DM45bn 
construction cost In a joint ven- 
ture with the German Thyssen 
group, wants to cut its interest to 
35 per cent. 

It is understood unsuccessfully 
to have asked BP, Shell and Esso 
to take a stake. Thyssen has also 
said it will not increase its hold- 
ing- 

BP was one of the disappointed 
bidders in the July 1992 sale of 
the existing, run-down Leuna 
refinery, which was made more 
attractive by the inclusion of the 
profitable Minol petrol station 
chain, with its estimated 25 per 
cent share of the east German 


petrol market 

While the British group was 
prepared only to refurbish the 
old 11.5m tonnes a year refinery. 
Elf, in a pact with Thyssen's 
engineering Interests, won the 
day with an offer to build a new 
10 m tonne plant 

Mr Kohl and president Fran- 
cois Mitterrand were both per- 
sonally involved In the agree- 
ment, which was hailed at the 
time as the biggest single indus- 
trial investment project in the 
former eastern Germany, and a 
triumph for the Franco-German 
alliance and the Treuhand’s pri- 
vatisation programme. 

However, Mr Philippe Jaffre, 
Elf chairman since last August 
and who steered the group 
through privatisation last month, 
is determined that his company's 
participation will be reduced as 
part of cost-cutting measures. 

ElTs profits foil more than 60 
per cent last year to FFrl.lbn 
(2160m). 

Elf said yesterday it was still 
seeking industrial partners, but 
refused to co mmen t on the state 
of negotiations. 


Banks probe risks of hedge funds 


Continued from Page 1 


be left holding bonds worth much 
less than the money lent 
In its questionnaire, the Bank 
of England asks banks: 

• What kind of dealings they 
have with hedge funds and in 
which areas. 

• How much information is pro- 
vided by dealers acting on behalf 
of several funds about how much 
each particular fond is buying or 
selling. For example, do banks 
know the names of all funds to 


which they are exposed and their 
level of gearing? 

• How they view the smaller 
funds that might be considered 
one-person operations when it 
comes to systems controls and 
back office capability. 

• What the characteristics of 
hedge funds are and whether 
they can be grouped together as 
an industry. 

On Thursday, when UK govern- 
ment bond prices fell by almost 3 
points, the bank stabilised the 
market with gilt purchases of 


less than £100m. Its main fear 
was that if dealers found they 
were unable to sell certain less- 
liquid gilts, they might be forced 
to mark down their prices dra- 
matically. That In turn, it was 
feared, might push the gilt mar- 
ket through so-called “support" 
levels, triggering a further bout 
of selling and putting additional 
downward pressure on prices. 

“Merely the fact that the bank 
was there as a backstop provided 
some reassurance to the market,” 
said one dealer. 


By Mark NBchofcton In Tunis and 
David Horovttz In Jerusalem 

The Palestine Liberation 
Organisation is to send envoys to 
Washington to dismiss its 
"requirements’' for resuming 
peace talks with Israel following 
the massacre of Palestinians in 
Hebron. 

Senior PLO officials said yes- 
terday the envoys would urge 
the US to put pressure on Israel 
to do more to protect Palestin- 
ians in the occupied territories. 

The PLO has rejected as “inad- 
equate" Israeli prime minister 
Yitzhak Rabin’s decision to dis- 
arm a few of the the most 
extreme Jewish settlers. 

Mr Yassir Abed Rabbo, a PLO 
spokesman, said: “We want to 
guarantee the safety and secu- 
rity of our people through mea- 
sures we are sure the Israeli cab- 
inet can take.” 

Israel must go further than Mr 
Rabin’s measures and “either 
disarm the settlers or prevent 
them from entering Palestinian 
villages and cities" before the 
PLO could consider resuming 
talks. 

The PLO was also calling for 
United Nations observers in the 
occupied territories, he said. 
“Ether we get guarantees or the 
Palestinian people will no longer 
back the peace process." 

hi Israel, Mr Sabin appealed to 
the PLO and the Arab states who 
have suspended peace talks with 
Israel - Syria, Lebanon and Jor- 
dan - to return to the negotia- 
tions 

If they did not, he said, they 
would be bunding victory to the 
extremists. Hr Rabin rejected 
Palestinian demands for all 
120.000 Jewish settlers in the 
occupied territories to be dis- 
armed and for some settlements 
to be dismantled. 

Mr Rabin said there would be 
no further compromises. His gov- 
ernment had ordered the deten- 
tion of a handful of extremist 
leaders, and the disarming and 
restriction of movement of about 
two dozen more. 

Palestinian protestors contin- 
ued to defy curfew orders in the 
West Bank and Gaza and clashed 
with Israeli troops throughout 
the occupied territories. 

The PLO hopes that the massa- 
cre will have a “Sarajevo effect”. 
It believes galvanising interna- 
tional, particularly US, opinion 
offers the only prospect of far- 
ther concessions from the 
Israelis. 

Several officials have called 
for the dismantling of Jewish 
settlements in Gaza and the 
West Bank. 

Others are suggesting that a 
swift resolution to the delayed 
negotiations on Israeli with- 
drawal from Gaza and Jericho 
would not now be enough to win 
Palestinian support for the 
broader peace process. 


Hebron killings. Page 7 


FT WEATHER GUIDE 


Europe today 

The boundary between wintry conditions in 
the noth and mild weather in the south will 
stretch from Denmark towards Poland. 
Demark, Germany and Poland wifl be mainly 
cloudy with rain mixed with snow in the 
north. Scandinavia will ba dry and sunny. The 
Benelux and the southern British Isles will 
have dewing skies while Scotland and 
western Ireland will have cloud and rain. 
France and Spain will have sunny periods, 
but the western Mediterranean will have 
thundery showers. Sunshine wiD be abundant 
in Portugal Greece, Turkey, southern Italy, 
and the southern Balkans will have sunny 
periods. 

Five-day forecast 

As high pressure over Scandinavia moves 
further east, a westerly air current over the 
Atlantic wffl increase, causing changeable 
conditions in western Etrope and later In 
south-western Scandinavia. Temper a tures 
will be rdativety m3d. Wintry conditions will 
persist over north-eastern Scandinavia. High 
pressure over the Mediterranean will give 
sunny, settled conditions with pleasant 
temperatures in south-eastern and south- 
western Europe. 



TODAY’S nBSPERATURES 


Situation at 12 GMT. Temperatures maximum for day. Forecasts by Metso Consult of the NoOiortands 



Maxtanan 

Belfast 

fair 

8 

CartSff 

cloudy 


Celsius 

Belgrade 

fair 

21 

Chicago 

sun 

Abu Dhabi 

lair 

23 

Berfin 

rata 

4 

Cologne 

ran 

Accra 

tab- 

33 

Bermuda 

thund 

18 

D* Salaam 

thund 

Algiers 

cloudy 

18 

Bogota 

cloudy 

20 

Dakar 

fair 

Amsterdam 

ratn 

9 

Bombay 

sun 

34 

Danas 

rain 

Athens 

sun 

19 

Brussels 

cloudy 

9 

Delhi 

sun 

B. Aires 

fair 

29 

Budapest 

fair 

15 

Oubal 

fair 

BJiam 

fan- 

8 

CJhagan 

windy 

1 

Duben 

Mr 

Bangkok 

fair 

as 

Cairo 

sun 

21 

Dubrovnik 

sun 

Barcelona 

cloudy 

13 

Cape Town 

shower 

21 

BJntwgh 

rata 

Bering 

sun 

e 

Caracas 

cloudy 

26 

Faro 

shower 


Lufthansa, Your Airline. 


@ Lufthansa 

German Airlines 


7 

Flarkfun 

I3F1 

10 

Malta 

sun 

20 

Rta 


X 

2 

Geneva 

rata 

a 

Manchester 

cloudy 

a 

Riyadh 

fair 

23 

11 

Gibraltar 

Shower 

17 

Manda 

chudy 

32 

Rome 

fair 

17 

32 

Glasgow 

rain 

6 

Melbourne 

fan 

22 

S. Fraco 


19 

22 

■Hamburg 

•Meet 

2 

Mexico City 

3101 

21 

Seed 

fair 

6 

13 

Helsinki 

sun 

-9 

Miami 

fat 

28 

Singapore 

cloudy 

31 

3C 

Hong Kona 

drarf 

13 

Man 

shower 

11 

StocfchUm 



24 

HanatUu 

SMI 

27 

Montreal 

sun 

-9 

Strasbourg 


10 


btanbU 

fair 

14 

Moscow 

sun 

-4 

Sydney 

cloudy 

17 

1< 

Jeraey 

nun 

9 

Munich 

fair 

10 




7 

Karachi 

fair 

32 

NUrofa 

fair 

29 

Tel Aviv 



17 

Kuwait 

fair 

21 

Naples 

Sun 

20 

Tokyo 


13 


L Angeles 

sun 

22 

Nassau 

fair 

27 

Toronto 

sun 

-3 












Lima 

fair 

28 

Nice 

rain 

14 

Vancouver 

rata 

11 


Lisbon 

sun 

15 

Nicosia 

SUl 

21 

Venice 




London 

shower 

a 

Oslo 

sun 

-4 

Vienna 

fair 



Lux.bocvr) 

rata 

9 

Rais 

rain 

10 





Lyon 

rata 

10 

Perth 

fair 

32 


fatr 

8 


Madeira 

fair 

17 

Pragya 

rain 

7 

WNHngton 

fa* 



Madrid 

shower 

13 

Rangoon 

Sair 

32 

Winnipeg 

fair 

2 

■ 

Majorca 

cloudy 

18 

Reyfcjav* 

rata 

3 

Zurich 

fair 

9 


THE LEX COLUMN 


HSBC’s good deal 


The Federal Reserve’s decision to 
tighten monetary policy three weeks 
ago raised two worries about HSBC 
Holdings. First, it was a reminder that 
its customers in Hong Kong would not 
enjoy indefinitely such a benign com- 
bination of low real interest rates and 
rapid economic growth. Indeed the 
risk is that the Hong Kong authorities 
may be forced to raise interest rates 
just as the regional economic cycle 
turns down. Second, the bond market 
weakness unleashed by the Fed’s 
action must have caused anxious 
moments for a bank with a £26bn port- 
folio of debt securities and which has 
become used to making large profits 
from playing the yield curve. 

Yesterday's annual results suggest 
the latter may remain the bigger 
worry. Provisions against lending in 
Hong Kong fell last year to a meagre 
£81m from £126m. They would cer- 
tainly rise if the economy turned: But 
it would take a fierce reversal of the 
interest rate trend for large-scale loan 
losses to occur. If the rise in rates 
remains modest, as still seems possi- 
ble, the bank could even benefit It 
would earn more on its interest-free 
liabilities 

By contrast, securities markets look 
unlike ly to maintain the buoyancy 
which HSBC needs to sustain its deal- 
ing profits. At £Llbn these are nearly 
a third of group operating profit Some 
£70Qm comes from securities dealing 
rather than foreign exchange. That is 
more than the entire increase in oper- 
ating profit which HSBC would have 
reported had Midland been a subsid- 
iary for the whole of 1992. It is no 
surprise that HSBC shares have 
started to under-perforin the sector, 
especially since the £160m aviation 
leasing provision shows It is still not 

nnmimp f mm 

UK pensions 

Yesterday’s holding statement from 
thB Securities Investments Board 
inspires little mnAHanw* in its damp- 
down on mis-seHing of personal pen- 
sions. It can (miy be hoped that the 
vague promise of proper information 
for investors and better control of 
salesmen heralds tough measures 
later this month. Neither the imposed 
fact sheet for investors nor the mooted 
14-day cootingoff period are likely to 
afford much protection unless the 
sales process is bought unde r dose 
control A mandatory comparison of 
the benefits under different pension 
schemes - and a dear written state- 
ment of the reasons why any transfer 


FT-SE Index: 3328.1 (+46.9) 


hsbov. .■ : '• 

ShsrerpWw retaflwtbJw v, ‘ .;v ; * :'?M’ 



■Sootac Dttutowfti- ■ T. "V£ T {.- 


should be made - would be good 
places to start 

Still, SIB is not acting alone. The 
new training and competence stan- 
dards promised by the Personal Invest- 
ments Authority - should tt ever get 
off the ground - might help start the 
necessary revolution in the education 
of salesmen. Full disclosure of com- 
missions paid to sales agents - forced 
cm a reluctant industry last summer 
by the government - should make the 
sale of pensions more transparent 

Moves to tighten methods of calcu- 
lating the value of pension bene- 
fits should help ensure a fair deal for 
consumers determined to transfer out 
of occupational That thorny 

issue Is, rightly, in the hands of the 
actuarial profession. Since pension 
transfers are still being made despite 
the evident pitfalls, though, a sense of 
urgency is clearly required. 

PolyGram 

While other entertainment compa- 
nies diversify in response to multi- 
media mania. PolyGram makes a 
strong case for the virtues of single- 
mindedness. Despite delays in releas- 
ing hit records and with recession still 
rippling through its . home European 
markets, PolyCfcam lifted net income 
by 21 per cent in 1993. Imagine what 
would have happened in a good year.. 

Efficiency gains nudged operating 
margins up to 12.6 per cant Weak 
European sales were offiset by a 31 per 
cent gain in the far east and a strong 
performance in the rest of the world. 
After some years of disappointment, 
PolyGram's US business is also com- 
ing good, benefiting from unutilised 
tax losses. The acquisition of Motown 


will further help the cause. Sales of 
music, which account far 12 
per cent of revenues, may be increas- 
ingly squeezed by cut-price competi- 
tors. But the company can more easily 
resist the trend in pop music where 
teeny hoppers with a craving for the 
Cranberries have nowhere else to go. 

PolyGram’s focus grows somewhat 
. fuzzy round the edges with its infant 
film production business still losing 
money. It may cautiously explore 
other ventures in related fields, such 
as video games and publishing. That 
threatens to dilute short-term finan- 
cial returns but may increase Poly- 
Gram's industrial appeal as a global 
.software factory. Few Investors are 
likely to sell such a prospect 

House of Fraser 

Private investors, by now used to 
being squeezed in small flotations, wifi 
have to get used to being squeezed in 
large ones if the House of Fraser float 
is any guide. The Stock Exchange is 
allowing SG Warburg to place 75 per 
cent of the issue - without any claw- 
back - leaving only around £l00m- 
worth in an offer for sale. Yet. given 
the Bow of retail funds into the stock 
market, it is hard for the exchange to 
argue a lack of interest The tilt on the 
playing field seems to have shifted fur- 
ther tn the direction of an easy life for 
fep d managers and guaranteed alloca- 
tions for institutions. 

In the circumstances tt is fortunate 
that House of Fraser Is unlikely to 
prove a glittering star. Its large, if not 
particularly saleable, property portfo- 
lio provides a solid asset base. But its 
growth prospects as a retailer are 
hardly electrifying. Much-needed 
remedial work by its new manage- 
ment menus that some improvement 
must be possible, but the company's 
ability to invest In the business Is con- 
strained by its cash flow. The com- 
pany also feces a struggle to present 
high quality service at the same time 
as cutting staff and introducing more 
part-timers. 

Department store retailing is 
increasingly unfashionable and, while 
House of Fraser’s performance may 
improve, that of other retailers will 
improve fester. The Fayeds have also 
been trying to sell the company for a 
long time. That argues for a discount 
to the sector. Presumably such consid- 
erations are why Warburg wants to 
-control the float, though if it can 
tickle the price up in the placing, 
there wifi be even less for retell inves- 
tors to shoot at 



Rodriquez Cantieri Nnvali, designers of the *Guizzo,* have taken foil advantage of the exri ;• 
propulsion. The world’s largest water jet ferry, it speeds 450 passengers between Genoa and S' 
Keeping bearing oil in - and sea water out of - its 38,000 horse power triple water jet pror j 
Jobs Crane Marine hub and input shaft sealing system. Made from specially designed ., v 
the system incorporates split-form sealing feces which can be replaced at sea if tx& ; 

continue making waves. 

John Crane is one of TI Group’s three specialised engineering businesses, the ot ; 

Each one is a technological and market leader in its field. Together, thei 1 
TI Group to get the critical answers right for Us customers / 

. r 

TI gro; 

WORLD LEADERSHIP IN 8PECIALIS’/ 

For further bifamntlon about the TI Group, contact the Department of Public Affairs. TI Grouj ft 




19 


WIPAC 


AUTOMOTIVE 
PARTS a 

accessories 


FINANCIAL TIMES 


COMPANIES & MARKETS 


THE FINANCIAL TIMES LIMITED 1994 


Tuesday March 1 1994 


HESMSIT EASESVte 
tkMqf 

THE OAK 


OF RUNNtm 
F2JSET I 



IN BRIEF 


Kmart falls more 
than $1 bn into red 

Kmart, the US retailing group that ranks as the 
world's second biggest, reported after-tax losses 
oT more than $lbn for the fourth quarter to Janu- 
ary. The poor financial performance came from 
an erosion in Smart's gross margin from 26.5 
per cent to 24.9 per cent. However, Federated 
Department Stores, which owns Bloomingdale’s 
and other department store chains, saw net Income 
before extraordinary Items rise 39 per cent to 
(146m for the fourth quarter. Page 22 

No upturn for Saab 

Saab, the Swedish carmaker SO per cent owned 
by General Motors of the US, yesterday announced 
its fifth successive year of losses, posting a 
SKrl.37bn ($l7lm) loss for 1993 before extraordinary 
items. Page 20 

Groupe Bull draws up recovery plan 

A plan for the recovery of Groupe Bull. France’s 
fore- making computer group, is due to be presented 
by Its chairman, Mr Jean-Marie Descarpen tries, 
today. The main ingredients are a reorganisation 
of the group's divisions to increase efficiency 
and productivity; cost-cutting; and plans to privat- 
ise the group as quickly as possible. Page 20 

Japanese forecasts downgraded 

More Japanese companies have warned that their 
profits for the current financial year may not 
match earlier forecasts. Page 23 

House of Fraser rises ahead of float 

House of Fraser, the department store chain which 
is preparing for flotation, raised operating profits 
25 per cent last year from £36. Im to £45m ($67m), 
the pathfinder prospectus revealed yesterday. 

Page 26 

Ahtotvs takes legal action 

Airtours, the holiday group, is taking legal action 
against the former owners of Aspro Travel, which 
it bought last June, alleging it was the victim 
of fraudulent representation at the time it acquired 
the Cardiff-based company. Page 26 

Capita completes restructuring 

Capita Group, which provides white-collar services 
to the public sector, raised pretax profits 24 per 
cent to £5-46m (fan) for the year. The group said 
its restructuring into three divisions had been 
successfully completed. Page 27 

Pegasus improves profitability 

Pegasus Group, the UK supplier of accounting 
software, improved profitability last year after 
a change of management, a large disposal and 
the launch of a new flagship accounting system. 
Page 28 

Sr Christopher Bland 

Because of an editing error, yesterday's Financial 
Times stated that Sir Christopher Bland, chairman 
of LWT, planned to resign yerterday. En feet he 
will remain chairman for the time being before 
being replaced by Mr Gerry Robinson, file Granada 
chief executive. 

Companies in this issue 


ANA 

Aetna 

Agfa-Gevoert 
Arab Banking Corp 
Ancon 

Avon Rubber 
Bennett & Fountain 
Bitom (J) 

Button 
Bolton Group 
Braime TFSJH 
BuU 

Canadian Pizza 
Capita Group 
Chicago Sun-Times 
Comaico 
Compaq 

Computer People 
Corporate Services 
Countrywide Bank 
DCS 
Daewoo 


Esab 

Euro Disney 
Empean Smafler 
Fairtviar 

Federated Dpt Stares 
Former 

Gartmora Scotland 

HSBC Holdings 

Healthcare HJcfe 

High-Point 

Hogg Robinson 

HoHnger 

IDV 

Iberdrola 

HDD 

Kanmana Resources 


23 

Kmart 

22 

22 

Kona 

21 

23 

IHeshafl 

29 

23 

London Forfaiting 

27 

28 

MCI 

1 

11 

MM Holdings 

23 

28 

Malaysia Airlines 

23 

28 

Midtand & Scottish 

29 

20 

Mkfland Bank 

20 

28 

Mttsukoshi 

23 

27 

NM Smafler Australia 

27 

20 

NTT 

23 

29 

Ofivetti 

22 

27 

PWA 

22 

19 

Panamco 

21 

23 

PanconUrrarrtal 

23 

21 

Pegasus 

28 

28 

Poty&am 

20 

29 

Prudential Corp 

28 

28 

Quayta Munro 

28 

40 

SE-Banken 

19 


Saab Auto 

20 

9*1 

Samsung Bectrontea 

23 


Saw! 

23 

Z1 

Select industries 

28 

10 

Serna 

27 

28 

Sumitomo Rubber 

23 

28 

Taylor Woodrow 

29 

22 

Tofas 

21 

11 

Tomorrows Leisure 

28 

28 

Tor brv Trust 

28 

19 

Travis Perkins 

28 

29 

Upton & Southern 

29 

29 

Viacom 

22 

28 

Vistec 

28 

19 

Wm Ransom & Son 

28 

28 

Woodchester lows 

27 

22 

Woodskta Cfshore Pat 

23 

23 

Xtra-Vfeion 

28 

28 

Young & Rubtoam 

11 


Market Statistics 


(Annual reports sanies 
Benchmark Govt bewto 
Bond Mores and options 
Bond prices and yields 

Pim TjUHn. i ririM- 

umnKxmxs pnere 
DMdendE announced, UK 
BAS currency rates 
GmAamt prices 
Rxed interest (rates 
FT-A Wort! ImScea Back Page 
FTGoM Mroj index Back Page 
FTASUA taa boon B*C 24 

FT-SE Actuaries Indices 31 


32-33 

24 

24 

24 

30 

28 

38 

24 

24 


Foreign exchange 38 

GKsprtes » 

LifTa oqurfy options Back Page 
London share ssntca 32-33 
London tnxfl options Back Page 
Managed hinds serein 34-38 


Money markets 
New M bond laws 
Recent Issues, UK 
Swrl-terro M /ales 
US Interest rates 
Worid Stock Markets 


38 

24 

31 

38 

24 


Chief price changes yesterday 


nufuenmr png 


Depsaa 

5U 


13 

Ak U**Ja 

642 

* 

26 

Hwtet 

306 

+ 

10 

BSH 

943 


85 

Kansas 

649 


12 

Club MW 

VB 

♦ 

14 

MM 

47B 

* 

12 

Hbwhs 

472 

+ 

28 

Mannar 

335 

#■ 

5 

knesal 

659 

4- 

26 

Fail* 








SudOssnto 

507 

-a 

8 

UFBUxabat 

445 

- 

a 

MW YORK (S) 



TOKYO (Tso) 








E®3«3 




MMrKfMnh 

15ft 


5ft 

AaaH opBcal 

402 

+ 

14 

ttaai 

35H 

+ 

3ft 

RiMVJW 

892 

+ 

22 

Mbratrecft 

71» 

* 

2M 

teMM 

349 

* 

25 

Warn B 

285* 

+ 

2ft 

USE ta'3 

362 


13 

Mb 




H* 




MtNsttaxi 

m 

- 

ft 

JMfcfce 

1180 

- 

SO 

ROpMonb 

sen* 

- 

ft 

Kurts Ctam 

441 

- 

20 

Now York prices at 1240pm. 





LQMJOM Wanes} 







Maas 




BIZ 

B53 


22 

MM 

6)5 


22 


229 


a 

BUM Ton 

M Data Mgmrt 

788 

223 

+ 

23 

12 

namwa 

2030 

* 

34 


110 

+ 

7 

Start*** Prop 


+ 

9 

Eng OBna ttys 

SJZ 

+ 

26 

FftHa 




Bn manor 
Gfriaiad 
taut Mat 

393 

371 

483 

+ 

+ 

15 

11 

12 

Mrtoara 

DF5 Furniture 

540 

312 

- 

13 

17 

UhetQA 

S97 

+ 

12 

HWHMW 

65 

- 

6 

Unto 

763ft 


10 


22G 

_ 


Hero FOCUS 
Mariam Ota) 

1028 

It4 

+ 

42 

6 

Pegasus 

220 

- 

10 

Rat Haas Loan 

m 


Jtft 

fbotenu 

128 

- 

a 


Holtinger acquires Chicago daily 



Conrad Black: big foray Into US 


By Ber na rd Simon hi Toronto 

Hollinger, the international 
newspaper group controlled by 
Mr Conrad Black, owner of the 
UK’s Telegraph group, has made 
its first foray into the urban US 
market by buying the Chicago 
Sun-Times, the country’s ninth 
biggest daily. 

Hollinger will pay 9180m for 
the privately owned Son-Times 
Company, whose assets include 
about 60 community papers in 
the Chicago area. 

The present owners, compris- 
ing institutional investors and 
senior Son-Times managers, 
bought the company six years 
ago in a leveraged buy-out from 


Mr Rupert Murdoch, the publish- 
ing ma gnate. 

Holllnger'8 vehicle for the 
acquisition is American Publish- 
ing, a wholly-owned subsidiary 
based in rural Illinois which pub- 
lishes 2 80 small-town papers 
across the US. 

Mr David Radlsr, Hollinger 
president, said the deal would be 
financed by bank loans. However, 
American Publishing plans to 
strengthen its equity base 
through a public share issue. 
The issue, for about $150m, is 
expected to be completed by mid- 
year. 

Mr Radler said the Sun-Times 
is a "better fit and a more viable 
company" Unyp struggling 


New York Daily News, which Mr 
Black unsuccessfully pursued 
two years ago. 

The Sun-Times, a tabloid, is 
best known for Us coverage of 
Chicago’s political scene, and for 
its sports news. It has & dally 
circulation of about 535,000 
copies, compared with 690JXX) for 
its bigger broadsheet rival, the 
Chicago Tribune. . 

The Sun-Times’ Sunday circu- 
lation however, is less than half 
file Tribune’s 1.1m. 

Mr James Goss, media analyst 
at Duff & Phelps, the rating 
agency, estimated that the Tri- 
bune has between 75 per cent and 
80 per cent of advertising reve- 
nue In the Chicago area. How- 


ever, he added that "in terms of 
number-two papers, the Sun- 
Times is probably as wall-posi- 
tioned as any could be". 

Mr Radler declined to disclose 
details of file Sun-Times' finan- 
cial performance beyond saying 
that it has been profitable for the 
past six years. 

However, the 1988 buy-out has 
left the present owners with a 
heavy debt-service burdao. 

Mr Radler indicated that 
Hollinger will apply much the 
same formula of tight cost con- 
trols and enhanced technology to 
the Sun-limes as it has brought 
to its other acquisitions in the 
UK, North America, Australia 
a pri ferae!. 


SE-Banken 
tackles loan 
losses to 
return to 
profit 

By Hugh Camegy In Stockholm 

Skandinavlika Eds fed Ida Hankm, 
the leading Swedish commercial 
bank which 12 months ago was 
polled to the brink of disaster by 
huge loan losses, yesterday 
announced a recovery In under- 
lying earnings. 

SE-Banken, the HwamHai pillar 
of the Wallenberg Industrial 
dynasty, reported an operatic 
profit of SKr357m ($45 m), com- 
pared with a loss of SKr5J37bn in 
1992 when it was forced to seek 
government aid. It withdrew the 
aid request last August as condi- 
tions improved and opted to 
recapitalise through a SKr5-3bn 
rights issue. 

Operating profits rose 81 per 
cent before loan losses to 
SKrlO-5bn, doe In large part to 
lower interest rates. The group 
continues to carry large lending 
losses, mostly related to the 
property, finance and insurance 
sectors. Incurred loan losses and 
provisions totalled SKrl0.17bn, 
compared with SKrll.lSbn. 

The problem loan total was 
down more sharply, to 
SKrl6.66bn from SKr25.9bn, 
accounting far 5.7 per cent of the 
loan portfolio, compared with 
7.53 per cent 

"We have passed the peak of 
credit losses,” said Mr BJOrn 
Svedberg, chief executive. "We 
now have a good platform for the 
future." He declared that the cri- 
sis that hit all Swedish banks in 
1992 was over, but declined to 
say how long it would take to 
posh loan losses down to normal 
levels. -The bank is not paying a 
dividend. 

Meanwhile, Fdreningsbanken, 
Sweden’s fifth largest bank, 
reported a 1993 operating loss of 
SKr2.09bn, compared with 
SKrl.34bn, as loan losses grew 
26 per cent to SKr4Abn. It said 
loan losses would tumble and 
tnoome rise this year, but was 
uncertain of returning to profit 
in 1994. 

At SE-Banken net interest 
earnings rose 49 per cent to 
SKr9.78bn. Commissions, fees 
and foreign exchange earnings 
rose 11 per cent to SKr&Sbn and 
other income ipse 87 per emit to 
SKrLfttm. The bank’s total capi- 
tal ratio was 13 per cent at the 
year-end, compared with 8.4 per 
cent at the end of 1992 when it 
threatened to fall below the 
international minimum of 8 per 
cent. 

Total assets fell 8 per cent to 
SKr448bn, because of reduced 
foreign currency lending and 
securitisation of loans. 


Alice Rawsthorn reports on the Euro Disney rescue talks 

Only a month 
to make the 


refinancing fly 


After weeks of delay and 
indecision Euro Disney, the 
stricken leisure group, has filially 
started negotiations with its 
banks on a FFrl3fan ($2.2bn) res- 
cue package. 

The two sides have a month to 
reach agreement before the 
March 31 deadline imposed by 
Walt Disney, the US entertain- 
ment group that owns 49 per cent 
of Euro Disney. Without a deal, 

Disney threatens to withdraw its 
financial support thereby forcing 
the closure of the EuroDisney- 
land theme park near Paris. 

"It's still early days but at this 
stage it looks as though we 
should be able to meet the dead- 
line," said one banker. "No one 
ever said fins deal was going to 
be easy, hut it is do-able. After 

all, no one 

wants to see 
Euro Disney go 
bust" 

The reason for 
the banks' cau- 
tious optimism 
is the investiga- 

SdEf S bondholders’ lobby 


The Disney camp 
claims that the 
distressed debt 
sales and the 


by KPMG Peat 
Marwick, the 
accountancy 

group, which 

concluded that 

Euro Disney could become a 
going concern if its FFr203bn net 
debt was reduced. KPMG calcu- 
lated that FFrl3bn was needed to 
stabilise the company's finances. 

The banks, led by Banque Nat- 
ionals de Paris and Banque Indo- 
snez, have proposed that the deal 
should be apportioned on a 5050 
basis with Disney. 

One element would be an injec- 
tion of capital from a rights issue 
and, possibly, a debt-for-equlty 
swap, which could be linked to 
the underwriting of the issue. 
Another element would be a cut 
in Euro Disney's financial costs. 
The banks might trim the inter- 
est rates on part of their loans in 
return for Disney forgoing or cut- 
ting its entitlement to royalties 
and ni ffpn gp torin t fees. 

Disney has indicated that It 
will take up its full share of a 
rights issue, but is intransigent 
on the royalty front The banks 
want extended indefinitely its 
waiver of a mpnag a prant foe of 3 
per cent of Euro Disney’s turn- 
over, which would have been 
worth FFrl45m last year. They 
have also demanded a cut in Hs 
royalties of 10 per cent of 
admissions and 5 per cent of 
food and merchandise sales, 


are minor 
distractions 


worth FFr262m last year. 

The US group has privately 
accepted the need for compro- 
mise; not least because it wants 
the hanba to trim the interest 
rates on their loans, notably the 
Caisse des Ddpdts which owns 
Euro Disney's FFnsbn 7.8 per 
cent fixed rate debt Bat it is 
reluctant to agree to a significant 
reduction in royalties for fear of 
setting a precedent 
Disney's room for manoeuvre 
is limited. It is anxious to avoid 
closing EuroDisneyland, which 
would not only damage its pros- 
pects in Europe hut could drag It 
into a legal battle in France. It 
has made a provision of 3175m to 
keep Euro Disney afloat until 
March 31 and has indicated that 
providing an outline agreement 

has been 

reached by then, 
it will continue 
to support the 
company until 
the deal is com- 
pleted. 

Yet Disney 
cannot afford to 
pour In money 
into Euro Dis- 
ney indefinitely, 
nor could it pla- 

cate the banks 

by taking a 
larger equity stake. If it raises its 
stake above the present 49 per 
cent it would, under US regula- 
tions, have to consolidate the 
European company's debt on to 
its own balance sheet 
It does have other options, 
including buying the five hotels 
at the theme park. It hag also 
held talks with prospective new 
investors, including an Arab con- 
sortium, which could be brought 
in as part of the refinancing. 

Meanwhile the hanks are strug- 
gling to mate tain a milted front 
The main threat to unity is the 
risk that some may succumb to 
the overtures of US secondary 
debt specialists and sell their 
loans at a discount - Midland 
Bank is on the verge of complet- 
ing the sale of a FFrl30m loan 
despite the reported opposition of 
the Bank of England. If others 
follow, it could complicate the 
negotiations. 

Another potential complication 
is a noisy French lobby of con- 
vertible bond holders. These 
investors risk their interests 
being heavily diluted by the 
restructuring and are threaten- 
ing to sue Euro Disney and its 
advisers. The Disney camp 
claims that the distressed debt 


Asia Pacific helps HSBC 
rise 51% to £2.58bn 


By John Gap per, 

Banking Editor 

A buoyant hanking market in the 
Asia Pacific along with big earn- 
ings from foreign exchange and 
capital markets trading fitted pre- 
fox profits of HSBC Holdings by 
51 per cent to £258bn last year, 
from £L74bn. 

Rising income more than offset 
an increase in provisions for bad 
debts to ELlSbn, against £990 m. 
There was a £160m charge 
against fails la the value of air- 
craft and other assets of its Con- 
cord Leasing arm in the US. 

HSBC, the second most valu- 
able company on the London 
Stock Exchange since its acquisi- 
tion of Midland Bank in 1992, 
lifted its final dividend to l(L5p, 
raising the total payout by 24 per 
cent to 23Jip. It also announced 
an enhanced scrip alternative to 
the final dividend, worth 50 per 
cent more than the cash final. 


Mr John Bond, HSBC chief 
executive, said last year had pro- 
duced “a very encouraging 
result”. The acquisition of Mid- 
land had "exceeded our expecta- 
tions, particularly in treasury 
and Investment hanking busi- 


Mr Bond warned that dealing 
income of £L09bn, against £G21m, 
was unlikely to he repeated this 
year as the tum in the interest 
rate cycle meant that treasury 
and capital markets “are unlikely 
to be as favourable". 

Total non-interest income rose 
23 per cent to £&58bn, compared 
with £2L9bn pro forma, after res- 
tating the accounts to adjust fear 
the consolidation of Midland. 

Dealing income includ ed to r- 
eign exchange earnings of £3T7m. 
against £383m. Most of a £72m 
increase in miscellaneous operat- 
ing income was due to higher 
income from the sale of fife and 
pension products in Midland. Net 


interest income rose 13 per cent 
to £4.44bn. The net interest mar- 
gin on loans rose to ZB per cent, 
against 2.7 per coat, helped by a 
release of suspended interest in 
Hongkong Wank- 

Profits were dominated by 
operations in Asia, with 
£L93bn, or 75 per cent of 
pre-tax profits, coming from 
Hong Kong and the Asia Pacific. 

The ratio of cost to income fell 
from 62J2 to 653 per cent 

The ratio of core capital to risk- 
weighted assets rose to 7.9 per 
cent, against 7.4 per cent Earn- 
ings per share rose to 7L7p. com- 
pared with 48.8p, although head- 
line egmingg per share excluding 
exceptional profits were 68.4p. 

Post-tax return on average 
shareholders funds rose 20A per 
cent against 17.3 per cent and 
return on assets rose to U. per 
cent, from 0.7 per cent 
Lex, Page 18 ; Sam of his parts. 
Page 17; Midland, page 20 



sales and the convertible lobby 
are minor distractions. But as the 
ftoarflinn approaches thfl financial 
prospects facing Euro Disney are 
as sobering as ever. 

Ms Rebecca Winnington- 


Ingram, an analyst at Morgan 
Stanley, calculates that, even If 
Euro Disney does secure its 
FFrl3bn refinancing, it will not 
move into profit until 1998. 


SEC head 
launches 
German 
initiative 

By David Wafer ki Frankfurt 

The q-ha trmgn of the Securities 
an d Exchange Commission, the 
regulatory body for the US 
securities industry, yesterday 
launched a "bridge-building” 
campaign in an effort 
to persuade mare German com- 
panies to list their shares in the 
US. 

Mr Arthur Levitt, who will be 
visiting 20 leading German 
industrial companies and banks 
during his two-day stay In Ger- 
many, told businessmen In 
Frankfort that tt was a lot easier 
for foreign companies to obtain a 
listing in the US than they might 

rninginn 

“The provision of information 
to investors is the sole condition, 
the real requirement, for access 
to our markets,” he said. 
"AH companies are welcome, 
with information as their pass- 
port.” 

At present, Daimler-Benz is 
the only German company out of 
a total of 594 foreign companies 
listed in the US. Germany’s big- 
gest company listed its shares in 
October Last year, prompting 
widespread criticism within Ger- 
man industry at the level of con- 
cessions made to the SEC on list- 
ing requirements. 

German companies have tradi- 
tionally objected to the SBCs 
disclosure rales, in particular 
the necessity of presenting 
accounts under US General 
Accepted Accou n t in g Principles 
(US GAAP). 

This objection ensured that, 
with the exception of Daimler, 
all companies in Europe's largest 
economy are denied direct access 
to the world’s largest capital 
market 

Mr Levitt said that the SEC 
had worked hard to make the 
listing procedures simpler for 

foreign companies. - ■ - - - 

Acknowledging problems with 
the commissfon’s image hi the 
past, he undertook to "make the 
SEC a positive, responsive 
force”. "I promise to listen care- 
folly, to avoid confrontation and 
to work with yon towards resolv- 
ing; rather than resisting, differ- 
ences,” he said. 

This Is the first time that a 
phain^ n of the SEC hac visited 
Germany. White many large 
German companies would like to 
tap the US equity market 
through a direct listing, this 
would mean abandoning Ger- 
many’s creditor-oriented 
accounting in favour of the more 
transparent, investor-oriented 
US accounting rules. 



Management Buy-out of 


L. Buffetti SpA 

Total financing in excess of £80 million 


Led and organised by: 

Baring Capital Investors 



Baring 

Capital 

Investors 

the EUROPEAN PARTNERSHIP 

HAUBVhO 

LONDON 

MILAN 

PARIS 


Institutional equity provided by: 

Baring Capital Investors advised funds 

Mezzanine finance arranged and underwritten by: 
Intermediate Capital Group 

Senior debt arranged by: 

Chemical Bank 

Underwritten by: 

Chemical Bank 

Banca Commercials Italians 

NatWest Markets, Acquisition Finance 


Since 1987, Baring Capital investors has led 20 
management buy-outs with a combined value 
of more than £1.5 biHion. .. 

Baring Capftal Investors b a member at WHO 


r* 

i* 

M 


w 





















FINANCIAL, TIMES TUESDAY j^4ARCH_M994 


20 

INTERNATIONAL COMPANIES AND FINANCE 


Saab cuts deficit in half 
but still loses SKrl.37bn 


By Hugh Camegy 
an Stockholm 

Saab Automobile, the Swedish 
car maker 50 per cent owned 
by General Motors of the US. 
yesterday announced its fifth 
successive year of losses, post- 
ing a SKri.37bu ($171 m) loss 
before extraordinary items in 
1993. 

But the result was a 49 per 
cent improvement on the 1992 

loss of SKi2.68bn and included 
a charge of SKx299m during 
the start-up and launch of the 
new Saab 900 model which 
went on sale last aut umn. 


By John Gapper and Alison 
Smith in London 

Midland Bank, the UK 
high-street banking arm of 
HSBC Holdings, quadrupled 
pre-tax profits to £844m 
(S1.23bn> last year, against 
£204m in 1992. despite weak 
demand for loans and a decline 
in fees and commissions. 

Operating profit, before pro- 
visions for bad and doubtful 
debts, more than tripled to 
£723ra, from £229m. largely 
because of very strong income 
from treasury and capital mar- 
kets trading activities. 

Sir Brian Pearse. who is 
retiring at the end of this 
month as chief executive of 
Midland, said the bank “con- 
tinues to operate under very 
difficult and trying circum- 
stances in a market that is 


By Kenneth Gooding, 

Mining Correspondent 

Restructuring costs at Billiton, 
the mining and metals busi- 
ness within the Royal Dutch/ 
Shell group, sent its net loss up 
last year from $75m in 1992 to 
S142m. 

Gencor of South Africa is at 
present negotiating to buy Bil- 
liton. 

During 1993 Billiton decided 
to close underground mining 
operations at Les Mines Sel- 
baie in Canada and to shut its 


Saab, which, has talked of a 
possible return to profit in 1994 
for some months, said yester- 
day the chances of reaching 
break-even were good. 

Sales rose to SKrl6.12bn 
from SKrl4.69bn. but this 
reflected the slide in the value 
of the Swedish krona during 
1993. The n umb er of vehicles 
sold was down sharply, also for 
the fifth year in succession, at 
73,600, compared with 86,800 in 
1992. 

Saab, jointly owned by GM 
and Sweden's Saab-Scania, has 
swallowed more than SKrSbn 
in new capital from its owners 


The specific bad debt charge 
against lending in the UK Tell 
by £U8m to £447m, but this 
was offset by a £37m charge for 
loans to less developed coun- 
tries, and a £50m general provi- 
sion against future corporate 
failures. 

The worst bad debt experi- 
ence was in overseas commer- 
cial banking, where the charge 
rose by £10Sm to £I31m. Bad 
debts in France and Germany 
rose “significantly" due to fall- 
ing property values in France 
and continuing recessions. 

Sir Brian said that UK com- 
plaints fell by 40 per cent after 
efforts to consult customers on 
the services they wanted. 

First Direct, Midland's tele- 
phone banking subsidiary, 
increased its customer base to 
more than 500,000 accounts by 
the end of the year. However, 
it only achieved a trading 


Toronto office. Several down- 
stream businesses in the 
Netherlands were sold in line 
with Billiton’s strategy to 
focus on mining and resource 
operations. 

There was an operating loss 
of S17m for 1993 with first-half 
profits eroded by weak metal 
prices. 

The mining business suf- 
fered an operating loss of $14m, 
downstream operations lost 
$6m and miscellaneous items, 
such as currency exchange 
losses and head office costs, 


and accumulated lasses of 
more than SKrllbn since GM 
bought into the company in 
1989 seeking a prestige Euro- 
pean marque to extend its 
range into an up-market niche. 

After a radical restructuring, 
during which it has almost 
halved it workforce to 7,900, it 
is pinning its hopes for recov- 
ery on the 900 model, coupled 
with improving conditions in 
its three main markets - Swe- 
den, the US and Britain. 

Saab has set a tough target 
of selling 87,000 vehicles from 
its 9000 and 900 ranges this 
year but says this is realistic. 


profit in December after 
monthly losses before that. 

Sir Brian said that First 
Direct had not yet achieved the 
same level of cross-selling 
financial products as mort- 
gages. He believed this was 
mainly because it had not yet 
made a strong marketing and 
sales effort with customers. 

Midland paid a dividend of 
£403m to HSBC from net prof- 
its of £646m after tax and 
minorities. Retained profit of 
£243m. against £102m, boosted 
the ratio of core capital to 
assets weighted by risk to 6.5 
per cent, against 5.7 per 
cent 

Total assets rose to £76bn, 
from £71bn. despite a fall in 
loans and advances to £38-6bn, 
from £42.5bn. There was a 
strong increase in holdings of 
debt securities from £5J9bn to 
£l3bn. 


accounted for a $15m loss. The 
marketing and trading busi- 
ness made a profit of gi8m. 

Gencor announced last May 
it hoped to reach agreement to 
buy the Billiton assets by the 
end of 1993 but the negotia- 
tions proved more difficult 
than expected. 

Mr Brian Gilbertson, Gen- 
cor's chairman, said last week 
that chances of a successful 
conclusion were “better than 
ever" but Gencor would “walk 
away from the deal" If it was 
not sealed by June 30. 


Debts push 
Vard 
deeper 
into the red 

By Karen Fossil m Oslo 

Yard, the Norwegian cruise 
and ferry group, yesterday 
reported substantially heavier 
lasses for 1993 with a pre-tax 
deficit of NKr361.04m 
(548.75m), against NKr229.47m 
a year earlier. 

Yard blamed its debt burden 
on a substantially weaker per- 
formance by Blaster Cruise, 
its cruise unit, and heavier 
foreign currency losses. 

Group operating profit rose 
to NKr568.86m from 
NKr459.33m. Revenue 
increased to NKr7.3bn from 
NKr5.47bn, but operating 
expenses swelled to NKr6JZ4bn 
from NKr4.67bn following a 
jump in depredation to 
NEr494m from NKr341m. 

Yard charged net financial 
items and foreign currency 
losses of NKr84 1.73m against 
NKr589.38m in charges the 
previous year. 

Miami-based Kloster Cruise 
said net contributions from 
the ships in its fleet rose to 
$294m from $348x0 in the pre- 
vious year, but that financial 
expenses had increased to 
$89. im from 556.3m. Net 
losses, before currency adjust- 
ments and other items, more 
than tripled to $19.5m from 
56.4m. 

Booster’s Norwegian Cruise 
Line's load factor for 1993 was 
very satisfactory, Vard said, 
and surpassed the previous 
year. 

However, prices achieved 
were not sufficient to compen- 
sate fully for larger interest 
costs and depreciations. 

Royal Viking Line's load fac- 
tor was unchanged but prices 
fell due to stronger competi- 
tion. Royal Cruise Line 
improved load factors and 
prices, but this was under- 
mined by maintenance and 
repair costs. A plan to sell 
Royal Cruise and Royal Viking 
for $565m fell through earlier 
this year. 

The ferry division saw net 
profits plunge to NKr78.6m 
from NKrl23.7m. despite a rise 
in operating income to 
NKr772-6m from NKr672«8m. 

Operating expenses rose to 
NKr458m from NKr342.3m. 
Vard said the division's results 
were, however, satisfactory. 


Midland Bank ahead four-fold 


over-supplied". 

Billiton hit by restructuring costs 


Auctioneer’s shadow falls over Bull 


John Ridding reports on the French computer maker’s uncertain future 


T he man in the red jacket 

bid FFr3,000 ($500) for 

the laser barcode 
machine. The woman in the 
blue jumper bought the chairs. 
Piece by piece, the contents of 
Groupe Bull's computer plant 
in VlUaneuve D’Ascq on the 
outskirts oi Lille in northern 
France were sold off to a 
packed auction room of busi- 
nessmen and the local public. 

The closure of the Bull plant 
and last week’s auction of its 
entire contents demonstrates 
the struggle faced by the 
French state-owned computer 
’group as it seeks to restruc- 
ture- The factory, designed to 
produce 550,000 computers 
each year, never achieved the 
target and foiled to break even. 
Bull's mounting losses, which 
have exceeded FFriSbn over 
the past four years, and the 
government’s order that it 
must stem the flow of red ink 
in preparation for privatisa- 
tion, meant the plant could no 
longer be supported. 

If the fate of the plant has 
now been sealed, the moment 
or truth is fost approaching for 
the group as a whole. A recov- 
ery plan, finalised by Mr Jean- 
Marie Des carpentries, chair- 
man, is due to be presented to 
Brussels wi thin a few days. 
Failure of the plan, or its rejec- 
tion by the European Commis- 
sion, which has frozen 
FFr2.5bn of state aid to the 
company and is investigating a 
further FFr7bn injection 
pledged last year, could push 
Bull the way of its factory. 

Mr Descarpen tries’ recovery 
strategy, drawn up since he 
took over the group in October, 
is based on several elements. 



Jean-Marie Descarpeutries; 
says profits possible in 1995 


The principal ingredients 
include a reorganisation of the 
group's divisions to Increase 
efficiency and productivity and 
to enable greater responsive- 
ness to customers, a series of 
cost-cutting measures, and 
plans to privatise the group as 
quickly as possible. 

On the first count, Mr Des- 
carpentries has split the 
group's operations into sepa- 
rate profit centres. Reporting 
procedures have been tight- 
ened and simplified and 
accountability has been 
increased. The performance of 
each of the group's six product 
and service divisions is to he 
assessed at the end of June. 
Those which fall short of 
expectations will face manage- 
ment chang es, according to the 
Bull chairman 

Costs are to be cut by the 
reduction of staff numbers and 
administrative charges. A plan 
to reduce the company's head- 


count by 6.500 in 1993 and 1994 
Is to be completed by the end 
of June when a decision will be 
taken on further job cuts. The 
company’s 24 sites in Paris are 
to be combined into just two 
main Offices, creating annual 
savings of about FFr530m. 

It Is in the privatisation 
plans, however, that Mr Des- 
carpen tries is proposing some 
of his boldest steps. He says 
the state’s 76 per cent share- 
holding could be reduced to 
below 50 per cent this year as a 
result of increased sharehold- 
ings by employees and the sale 
of a stake of between 15 and 20 
per cent of the group to an 
industrial partner. 

Mr Descarpeutries says that 
talks are under way with 
potential investors. Candidates 
include NEC of Japan, which 
already holds 4.4 per cent of 
Bull and which works with 
Bull on several joint projects, 
includin g the development of 
main fra ms business comput- 
ers. 

The sale of a substantial 
stake in the French computer 
group to a foreign company 
would be politically sensitive, 
but could receive the blessing 
of Mr Gdrard Longue t. the 
industry minis ter, who has set 
a target of two years for Bull to 
move to the private sector. A 
deepening of the alliance 
between Packard Bell of the tJS 
and Bull's Zenith Data Systems 
personal computer operation is 
also a possibility. 

Partners will only be enticed, 
however, if there is some pros- 
pect of a return on their invest- 
ment. Bull’s record of failed 
recovery plans, the severity of 
competition in the interna- 


tional PC market and the scale 
of the changes which need to 
be wrought at the French 
group, demonstrated by losses 
last year of FFra42bn, place a 
heavy burden of persuasion on. 
the Bull chief. 

He argues that it is possible 
to return Bull to profit during 
1995 and that this can be 
achieved without a fire sale of 
loss making businesses. “We 
must break the vicious circle 
of closing operations and los- 
ing sales." 

He points to some encourag- 
ing signs. January sales were 
up by 23 per cent, year on year. 
Even ZDS, the source of much 
of the company’s Vosses since it 
was acquired in 1989, is exper- 
iencing an improvement in 
trading results, the company 
says. The increased concentra- 
tion on services and consul- 
tancy activities will, according 
to Bull, increase its presence in 
higher value added business. 

I f enticing industry part- 
ners will be hard, persuad- 
ing Brussels to accept 
Bull's recovery plan could be 
even more difficult Mr Karel 
Van Mlert, EG competition 
commissioner, has indicated he 
will take a tough line, demand- 
ing proof of a viable recovery 
plan. 

If the capita] Increase does 
go through it is sure to be for 
the last time. For Mr Descar- 
pen tries, therefore, the stakes 
could not be higher. AO of his 
proposals, from Improving pro- 
ductivity to the search for 
Industrial partners, must fit 
together. Failure on any of the 
fronts of his battle plan could 
spell disaster. 


PolyGram ahead 21% despite shortage of hits 


By Michael Skaplnker, Leisure 
Industries Correspondent 

PolyGram, the recorded music 
company, yesterday announced 
net income for 1993 up 21 per 
cent to FI 614m (S32Qm). despite 
a paucity of new hits. 

The company, 75 per cent 
owned by Philips of- the 
Netherlands, said strong per- 
formances in the Far East and 
North America compensated 
for a relatively weak showing 
in Europe, its largest market 

European operating income 
rose 7 per cent to FI 605m. 


North American operating 
income doubled to FI 104m and 
the Far East and Japan 
enjoyed a 22 per cent increase 
to FI 197m. 

Net sales were up 12 per cent 
to Fl7.4bn. The total gross div- 
idend for the year is FI 0.75, up 
15 per cent 

Pop music sales grew by 13 
per cent Classical sales, how- 
ever, were at a similar level to 
,1992. 

Mr Alain L£vy, chief execu- 
tive, said budget labels were 
pushing classical music prices 
down. He conceded there was a 


danger that classical record- 
ings might come to be viewed 
as commodity items. He said 
PolyGram hoped to resist the 
trend with classical releases 
from well-known artists such 
as Anne Sophie Mutter and 
Kiri Te Kanawa. 

PalyGram's film interests 
accounted for 9 per cent of 
total revenues. The company 
released 13 Sims last year and 
intends to release IS this 
year. Mr L6vy said PolyG ram’s 
film interests had so for pro- 
duced only “average results" 
but said the company had 


learned mace about the indus- 
try and was on track to produ- 
cing better results. 

Mr L6vy said he did not 
believe that multi-media and 
interactive entertainment 
would take hold as quickly as 
some analysts and industry 
insiders thought. 

He said that while the tech- 
nology would appear in homes, 
those who believed its wide- 
spread introduction was immi- 
nent foiled to take account of 
consumers' desire for passive 
entertainment 
Lex, Page 18 


NFAV' ISSUE Thisantnmneemem appears as a matter nf record only. JANUARY 1994 

£125,000,000 

MMk W THE BOC GROUP 

The BOC Group pic 

i iih . »rp i •rated m l-'nyhtnJ with limited liability under the C> mpanics Arts to W registered numher JJrWri j 

6%% Bonds Due 2004 

CS First Boston 

Barclays de Zoete Wedd Limited Goldman Sachs International Limited 

NatWest Capital Markets Limited S.G.Warburg Securities 

Ca/enove «SrCo. Samuel Montagu & Co. Limited 

J.P. Morgan Securities Ltd. 


Substantial increase 
in profitability 

In general, the years' result shows that Realkredit Danmark is on the right track. 

There is a good basis for development of services, quality and new products. These will be 
developed according to customer needs and requirements and will give Realkredit Danmark 
a strong and independent profile in an increasingly competitive mortgage market. 


It is our aim to be the preferred choice in all areas. 77 


Kjeld Jorgensen 

Chief Executive Officer 


Financial results for Realkredit Danmark Group 


Realkredit 

Danmark 

Group 


Realkredit 

Danmar k 

A/S 


SD 

Holding 

Group 


ED 

H o lding 

A/S 


DEE m 

19S3 

1992 

1993 

1992 

1993 

1992 

1993 

Highlights from the profit and loss account 

Nat income from interest and fees 

3,450 

2.569 

3,429 

2.546 

3,457 

2.569 

7 

Value adjustments 

TVZ65 

(491) 

1,247 

(497) 

i^as 

(491) 

_ 

Other Income from ordinary activities 

109 

112 

45 

53 

109 

112 

_ 

Administrative costs etc. 

(791) 

(799) 

(711) 

(733) 

(791) 

(799) 

_ 

Depreciation of assets 

(89) 

150) 

(48) 

(32) 

(69) 

(60) 


Write-dawns and provisions (os losses on loans 

(2.404) 

(2.413) 

(2,403) 

(2330) 

(2,404) 

(2.4131 

_ 

Value adjustments of subsidiary Interests 

(28) 

(36) 

(39) 

(68) 

(28) 

(38) 

lv472 

Ordinary profit 

1,532 

(1.108) 

1.520 

(1.109) 

1,539 

(1,108) 

1.479 

Extraordinary items 

(02) 

(283) 

(49) 

(172) 

(62) 

(183) 


Profit before tax 

lv470 

(1.291) 

1,471 

(1.281) 

1.477 

(1.291) 

1A79 

Tax 

(1) 

2 

1 

(1) 

(1) 

2 


Minority Interests 

3 

7 

- 

- 

3 

7 

- 

Profit for the year 

VI 72 

(1.282) 

1,472 

(1.282) 

1.479 

(1.282) 

1,479 

Key balance sheet figures 

Assets; 

Cash in hand and outstanding amounts at 
other credit Institutions 

20,114 

13.079 

26.305 

13,339 

26.201 

13.169 

87 

Lending operations 

303.595 

307.089 

303,406 

306.873 

303,595 

307.089 


Security portfolio 

48,068 

14.059 

48,738 

14,105 

48,688 

14.069 

9,968 

Other assets 

3,886 

3.969 

3,769 

3,836 

3,886 

3.969 


Total assets 

382^81 

338.196 

382^38 

338,153 

383,388 

338.276 

9,063 

Liabilities: 

Debt to other credit institutions 

3,550 

331 

3,550 

331 

3350 

331 


Mortgage bonds and other 
mortgage-backed securities 

350,848 

314,329 

350,848 

314.329 

350,848 

314.329 


Other liabilities 

15^18 

12.906 

16.875 

12.863 

35,917 

12,986 


Subordinated capita] 

3.000 

3.000 

3,000 

3.000 

3,000 

3.000 


Shareholders' equity 

8.965 

7.630 

8,965 

7.630 

9,053 

7.630 

6,053 

Total llabfUtiea 

382381 

333.196 

382238 

338,153 

382,368 

338.276 

8,053 


From Monday. 21 March, you are welcome lo call the Customer Services Department 
to request the annual report. Tr.e telephone/fax numbers are given below. 


Da 


REA L KREDIT 


nmark 


Jarmars Plads 2, DK-1590 Copenhagen V, Denmark 
Tel - . +45 33 12 53 00 Fax: +45 36 88 22 27 


L 




StMfnira 



' •>: 


«f hits 



FINANCIAL TIMES TUESDAY MARCH 1 1994 

INTERNATIONAL COMPANIES AND FINANCE 

Compaq 
plans $20m 
expansion 
in Texas 


Turkish privatisation hit by devaluation 

Motor company Tofas faces more than one challenge, writes John Murray Brown 


By Louise Kehoe 
hi San Ftenclsco 

Compaq Computer plans to 
spend $20m expanding its 
manufacturing facilities in 
Houston, Texas, it is mwhip 
seven new production lines for 
desktop and portable personal 
computers to increase produc- 
tion capacity by 41 per cent 
The move reflects rapid 
growth in PC demand and 
Compaq's rising market share. 

The US expansion follows 
the recent announcement that 
Compaq plans to broaden its 
manufacturing operation in 
Erskine, Scotland, with a 
110.5m expansion. Last year 
Compaq also opened a new 
plant in Shenzhen, China. The 
company is shortly expected to 
announce expansion of its pro- 
duction facilities in Singapore. 

The Houston expansion 
marks the return of portable 
personal computer production 
to the US for the first time In 
two years. In 1991, the US gov- 
ernment imposed trade sanc- 
tions on Japanese active 
matrix flat panel displays, 
used in notebook, computers. 
As a result, Compaq and other 
US manufacturers shifted 
manufacturing off-shore to 
avoid prohibitive 63 per cent 
dumping duties. 

Last March, the US govern- 
ment lifted the sanction, 
enabling Compaq to produce 
portable PCs in the DS cost 
effectively. 

However, Compaq officials 
said their decision to expand 
US production was based 
largely on productivity 
improvements and cost reduc- 
tions at the Houston plant. 
The company has doubled its 
production per square foot in 
the past two years. 

• IBM France, the French 
unit of International Business 
Machines, expects stable turn- 
over in 1994, compared to 
1993, Reuter reports from 
Paris. 

Exports continued to suffer 
from a price war which was 
undermining a rise in demand, 
said the company. Turnover 
fell 15.7 per cent in 1993 to 
FFr30 -9bn (S5.3bn). 


A devaluation is just 
about the last thing an 
international share 
issue wants weeks ahead of 
launch date. But for Totes, the 
Turkish motor group, adverse 
currency movements are sim- 
ply the latest in a long hnp of 
problems. 

The Turkish government is 
sidling its 21 per cent stake in 
Tofas, in which Flat of Italy 
and the Turkish Koc group are 
major shareholders. Brokers 
expect the issue to be at a sig- 
nificant discount to the mar- 
ket 

The International equity 
offering 1s for 20m global 
depositary receipts (GDRs) and 
American depositary receipts 
and is expected to raise 
between $4Q0m-$450m. it wffl 
be followed by a smaller 
domestic offering. Pricing is 
due to take place tomorrow. 

J Henry Schroder Wagg and 
Lehman Brothers are joint lead 
managers and joint global 
co-ordinators, with Daiwa, 
Goldman Sachs, Morgan Stan- 
ley and UBS as co-leads. If suc- 
cessful, the offering could revi- 
talise Turkey's privatisation 
programme and open the way 
for the disposal of a range of 


Turkish state monopolies In 
the next two years. 

Tbfias is Turkey's largest car 
producer with 25 per cent of 
the local market. Total car 
sates grew from 116,000 in 1988 
to 31X000 by 1993. Net sales 
were Sl.OSbn in 1992, and 
$Llbn for the first nine months 
of 1993. 

But in many ways the com- 
pany is an uncomfortable relic 
of Turkey's protectionist past 
It produces out-moded models 
behind high tariff barriers, 
supplied by local components 
manufa cturers in which the 
company is also controlling 
shareholder. 

Tofas is a manufacturing 
company with its distribution 
business, Turk Oto Tt caret, 
separately listed on the Istan- 
bul stock exchange. The issue 
prospectus goes to lengths to 
dispel concerns about possible 
transfer pricing between the 
manufacturing and distribu- 
tion businesses. 

Totes is in a curious posi- 
tion. Once Import tariffs are 
scrapped in line with the cus- 
toms t m*™ 1 with European 
Union in 1995, there is little to 
stop Fiat Importing direct from 
Italy instead of BfaWng farther 


Tofas ■' 



SbmsFTGRfHtt 


funds into its Turkish subsid- 
iary. Making matters even 
more precarious, the licensing 
agreement with Fiat, on which 
Tofas is dependent for technol- 
ogy and dpwign, expires in 1997. 

There are also doubts about 
the relationship between the 
Turkish government and Fiat 
The government was forced to 
rerofpi plans for a full public 
listing in New York, after flat 
intervened. Both Fiat, with 42 
per cent, and Hoc. with 34 per 
cent, were known to have res- 


ervations, particularly over the 
rigorous disclosure demanded 
by tile US Securities and 

P/rmmicginn 

The present international 
share issue is a more restricted 
private placement with institu- 
tional investors, with GDRs 
issued in European markets. A 
small amount of stock will be 
f lo ated in a secondary offering 
in Istanbul, where Tofas is 
listed. 

Last month's 12 per cent 
devaluation of the Turkish lire 


has cast further doubt over the 
sale. Totes is vulnerable to cur- 
rency instability since its 
recent profits performance has 
been fuelled in large part by 
the availability of easy credit. 
With Interest rates pushed 
higher to defend the currency, 
Turkish hire purchase costs 
have rocketed and consumer 

rigmanri fallpn 

The currency turbulence has 
meant the h anks are unwilling 
to underwrite the Turkish 
offering, which is being allot- 
ted in a “best offer” basis. 

A quarter of Totes' B£00 
workforce is being 
stood down for a 
month as part of a production 
slowdown. Bat the company is 
planning to spend 5500m to 
increase installed capacity to 
300,000 cars by the end of 1996. 
There are also plans for new 
lines. At the same time, the 
industry is lobbying for a five- 
year reprieve to the customs 

union HpnrTHnp 

Reprieve or not, motor Indus- 
try analysts anticipate shrink- 
ing market shares for local car 
producers, reduced margins, 
and lower real earnings, as 
imports increase. 


Panamco to increase 
stake in subsidiaries 


By Damian Prase* 
bi Mexico City 

Pan amen can Beverages 
(Panamco), Latin America's 
largest soft drinks bottler, 
wants to buy minority inter- 
ests in its Mexican subsid- 
iaries. 

If the offers are accepted, the 
purchase price would be about 
5500m, It will be funded by 
$l0Qm in cash and a bank loan. 

Panamco is the second-larg- 
est Coca-Cola bottler in the 
world, with annual sales of 
5957m in 1992. It plans to refin- 
ance part or all of the purchase 
with a public offering of its 'A' 
stock. Panamco directors have 
already agreed to tender their 
shares in the subsidiaries and 
stand to gain 550m from the 
transaction. 

Panamco has significant 


interests in Mexico, Brazil and 
Colombia, controlling about 50 
operating subsidiaries in the 
three countries. Coca-Cola 
owns about 10 per emit of the 
company, but has not matte it 
an anchor bottler. 

Panamco intends to buy up 
to 46 par cent of Azteca, its 
holding company for Mexican 
operations, and outstanding 
shares held by minority inves- 
tors in subsidiaries controlled 
by Azteca. It said the price 
offered for shares in Azteca 
and subsidiaries is equal to 13 
times 1993 earnings. Neither 
Azteca nor subsidiaries has 
publicly traded stock. 

“This is an intelligent way 
for Panamco to takB a bigger 
stake in their fastest growing 
market,” said William Scovta. 
an analyst with Nomura, the 
brokerage. 


Kone dose to 
finalising sale 
of cranes unit 

By Christopher Brown- Humes 
in Stockholm 

Kone, the Finnish elevators 
group, is c ite* to finalising thfi 
sale of its cranes unit as part 
of its strategy of focusing on 
core business. The company is 
not identifying the buyer until 
discussions are complete. 

Kone Cranes is a world 
leader in industrial cranes and 
ship-to-shore cranes. Since it 
was formed in 1930, the opera- 
tion has grown to span 40 com- 
panies in 20 countries. 

Analysts believe the unit 
could fetch up to FMlbn 
($13lm), although it is bard to 
value because the group does 
not specify profit figures for 
individual operations. 

Kone Cranes had sales of 
FMUSbn in 1993, up 26 per 
cent 


Recession cuts profit 
at Esab to SKr82m 


By Hugh Camegy 
In Stockholm 

Esao, the world's leading 
producer of welding equip- 
ment, yesterday reported a 
near 50 per cent slide in 1993 
pro fi ts after financial items to 
SKrifim (510m), as Income fell 
from recession-hit Europe and 
a cooler Brazilian market 

But the Swedish group said 
1992 profits had been inflated 
by a oneeff profit of SKr99m. It 
said income to the fourth quar- 
ter of 1993 accounted for more 
than half thfi inrama for the 

full year, and predicted a 
strong improvement in 1994 as 
demand in some European 
countries and Brazil had stabi- 
lised and growth continued in 
North America. 

Sales in 1993 rose to SRrTtm 
from SKr6.4bn, and orders 


grew to SKr7.13bn from 
Skr6.4bn. But Esab said these 
were distorted by the sharp tell 
last year in the Swedish krona; 
taking this into account, sales 
fell by 4 per cent The company 
is holding its dividend at 
SKrfL25 per share. 

Esab has faced a sharp 
decline in the main western 
European markets for welding 
equipment - Germany and 
Italy - since 199L But it expan- 
ded In Russia and eastern 
Europe, acquiring 70 per cent 
of the Czech republic’s leading 
welding company, Zelezamy- 
Vamberk. 

In January it also signed 
contracts to set up two joint 
ventures in China, the largest 
a plant in Shanghai which will 
have a production capacity in 
1995 of 30,000 tonnes of welding 
electrodes. 


21 


Notice to Holders 

NOTICE IS HERESY GIVEN that, with affect from 21tf March, 1994, 
Internationale Nedarisnden Bank (Luxembourg] SA. Luxembourg 
(formerly NM8 Bank (Luxembourg) SA), wiH resign as Sub-Paying 
Agent on the following issuos:- 

BrocadJRoao. London Branch Hydro-Qnsbee 

ecu 2oo.&oo,ooo n oo,ooa,ooo 

Floating fUtr Depositary Receipts IlKK Debennme Series HV duo 

due 1397 April 17.2001 

Tire BOC Group. Inc. RM International HnancaN.V. 

U-S.S160.000.0W ECU 126.003,000 

7% Guaranteed Bonds due 1BS7 9% Nows due IBM 

total Amartaan Development Bank 
Can SI 60000,000 
10JC% Bends due 1996 


Bradford ft Btngtey BuOdog Society 

£200,000,000 

nesting Rste Notes due 1B9S 
Bradford & BJngtey Building Society 

nmom.ooo 

Flooling Rate Notes due January 1 B9S 

Bradford fitBlnghy Budding Socwty 
£150000000 

Homing Rate Notes due 1997 
Bradford & Blngtey Building Bod sty 
CTEUHJDlOOO 

floating Rate Notes due 2001 

British Bw irnu i na tio nal Branca B.V. 
Can £200,000.000 
9fc% Guorannwtd Bonds due 2001 

British Gnitntomatkinol Hnenee B.V. 
U5.S1500S0O0W 

Zero Coupon Guaranteed Bonds 
due 2021 

British Gm kntaraedonil Hnanoe B.V. 
US.S2W.OOO.OW 
8V& Guaranteed Bond* due 1997 
British Gas International Hnenee B.V. 
ECU 150000,000 
8k% Guaranteed Bonds due 1997 
British Gas Hterosttenel Rnanee B.V. 
Lee 150000^00000 
12% Guaranteed Nous due 1996 

CARtPUJ- Cases dl R U penpto Prite 

Prov ii tc ia Lombards SJAs. 

Leaden Branch 
Can SI 50. 000 toO 
8fc*. Depositary Receipts due 1 997 
CJry of Stockholm 

Can St 30.000.000 

10K% Notes dual 996 
CHy ef V ancou ver 
Can $40,000 toO 
tOVfe Bonds due July IS, 2001 
Commonwealth Bank Australia 
AS1QDMQD00 
11% Bonds due 2001 

The Council of Europe Bositic ms nt 
Fond for Notional Refugees end 
Over-Population In Europe 
ECU1.10Q.000.000 
9% Bonds due 2001 

Oracft Co mm e r c ia l da Fiance 
Can 550 .WO, OW 
1014% Notes due 1994 

Credit Commercial da France 
Can 51 50. 000, WO 
m% Notes due 1996 
A/S Eksportflnsns 
CanS100.0W.W0 

7k% Notes due 1997 

Enso-GutzahOY 
U-S.S70.000.000 
floating Ran Notes due 1994 
Font Motor Cradt Company 
U-S4200to0to0 
8% Notes due 1994 

Font Motor Cratfit Company 
Ure 150.000to0.000 
12X% Notes due June 12. 199S 


Leads Pen 


■otBuMno Society 


El 00.000 toO 
HostinglFbaxl Ren Notes due 1997 
ThelWunlclpaBtYofMe tr op oB tan 
Toronto 

Can$l25to0to0 
9SWL Debentures due May 14, 2002 
Nationwide Anglia Butcting Society 
ooaoooooo 
nSi% Nous due 1986 
Nationwide AngBa Bufldbifl Society 
U.S.S150.00CUBO 
Hosting Rate Notes due 1 99S 
NordbanbM 
U-S. $50,000,000 

Floating Rate Notes due 1996 
set against Swiss Franc Libor 

Norsk Hycbo AS. 

U-S. 5T SOtoO.OM 
8S% Bonds due 2001 
OwBTauekhliUia KmitoiWisi * A.O. 

ns cnuMQ too 
7K% Guaranteed Notes due 1 996 
Hie Penbtsutsr end Oriental Steam 

Navigation Company 

A$i 00,000 too 

1490% Notes due 1996 
The Procter & Gambia Company 

r« <200.000.000 

1(A% Bonds due August 1 6. 2001 

P rovince da Quebec 
YenBOtoOtoOtoO 
SX% Notes due 2001 
Province of Saskatchewan 
Can 5750.000 toO 
10% Noras due ISM 
Prudential Fundbtg Corporation 
QmS2&0toQto0 
BMC. Notes duo December 18. 1999 
Prudential Funding Corporation 
CanSIZStoOtoO 
' 9Mb Notes duo 1997 

Redfand Starting HmcfiogPLC 
Cl 75.000 too 

103i% Guaranteed Bonds duo 3001 
fteed PiMWdng (USA) Die 
UJ5.Sl2Sto0to0 
9% Guaranteed Bonds due 1996 
The Regional Munidpatity of 
Hamtiten-Wentwonh 
Can 575. OW toO 

RetraenUa Term Debentures due 
June 6, 2006 


Royal Bank oft 
CanSI 50000000 
9X% Deposit Notee due 
January 7. 1997 

State Bank oi New South Wales 
Umitad 
AflOOXIOOtoO 
IIS* Bonds due 2001 
Total 

Can 51 00 too toO 
lOJf* Noras due 1996 


AH holders of Coupons, Notes. Bonds, Depositary Receipts and 
Debentures of the above mentioned issues should note that the new 
Sub-PBying Agent In Luxembourg wiH bet- 

Banqua Generate du Luxembourg SA. 

Z7, Avenue Monterey 
L-2951 Luxembourg 

ROYAL BANK 
OF CANADA 



77 Queen Victoria Street London EC4V40E 
Telephone: 071-489-1188 Totex:929Tn Facsimile: 071-3294142 


U.S. $125,000/300 



BANK OF BOSTON 
CORPORATION 

Floating Rate 

Subordinated Notes Due 1998 

Issued 26th August 1986 


Interest Rate 
Interest Period 

Interest Amount per 
U.S. S50,000 Note due 
31st May 1994 


3.8% per annum 
28th February 1994 
31st May 1994 

U.S. 348^56 


CS First Boston 
Agent 


U.S. $150,000,000 

M 

R&I Bank of Western Australia Ltd 

jus*, oso s t r aw s 

/Incorpomttd with Birthed liability in the State of Wattm Australia) 

Guaranteed Floating Rate Notes Due 1984 
unconditionally guaranteed by 
The Treasurer of the State of Western Australia 

/under Section 33 of the RAJ Bank Act 19901 

For the interest period tram March 1. 1994 to September 1. 1094 
the rate has been determined at 4.0625% per annum. The amount 
payable on September 1. 1994 per UR. Si 0.000 and U -3- £250.000 
principal amount of Notes wiH be U-S- $207.64 and U.S. $5,190.97 
respectively. 

By: The Chase Manhattan Bank. NA. CHASE 

London, Agent Bank 

March 1.1994 ■ 


CITICORP O 

mortgage SECURITIES, INC 

REWI1C Pass-Through Certificates, Series 1987-13 
US5S7.057.000 Initial Stated Amount 
of Class A’lCitkertifkatos 

For i he period la M.vch. I9W to W June. i9W iheCtess 
A-I CiticKritficaf*; will cany an inicresi rale of 4fO% per 
annum with an I merest amount of USS2/7S per USSLOOO (the 
Initial Slated Anwuiti of an individual CUkemficMe) pyaMe 
on bi June, WW. The Srarad Amount of the OnaatiliKtts 
SLJSnST will 1“ W.7M5WTW. of Ik Intel JMcd 

Amount trf the Ciitcurtificates. or USS247JI per mdhnduaJ 
CbrecrfifcdK until Isl June. IW*. 


taM*dvWM 


Broke* America NT ASA. Rl 
London -Ag*M Rank III 



Learn Technical Analysis 

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Can London ® 44*W 71 831 3558 

teVtxgOiiKteaiteSigrBlpieajlti;^^^ 


We are pleased to announce 
the following European promotions: 

Managing Director 

Michael O'Hanlon, Fixed Income 

Senior Vice President 
Nihal Abed, Fixed Income 
Peter Bryant, Fixed Income 
Roy Copperwaite, Fixed Income 
Edward Hamilton/ Fixed Income 
Trevor Irigrey Equity 
Jorge Villon, Fixed Income 

Vice Presidejmt 
Dara Bahadori, Equity 
Scott Crichton, Fixed Income 
Sean Davies, Fixed Income 
Robert C. Gamer, Fixed Income 
Jean-Maurice Hagiage, Equity 
Paul Kozary, Fixed Income 
Christopher Lamb, Fixed Income 
Oswald J. Luck, Equity 
Mark A. Scullion, Fixed Income 
PaulSempere, Investment Banking 


Kidder, Peabody 

Now we're talking 

KID0CR, PEABODY IS A WBSUBAiW OF GENERAL ELECTRIC C£L USA. 



# ^ ■hs ; 


22 


^MsBank 

Australia and New Zealand 
Banking Group Limited 

A.C.N. 005 357 522 

(/lu-oTponurti uidi timiud Lability in the Stale of Vkwria, Australia) 

U.S. $125,000,000 

Floating Rate Notes due 1 996 

Notice b hereby Riven due for che InrercsC Period 28th February, 1994 
to 3l« May. 1994 the Notes will carry a Rate of Interest 
of 4.125 per cent, per annum with an Amounr of Interest of 
U.S. £105.42 per U.S. S10.0CO Note and U.S. $1,054.17 per 
U.S. S 100.000 N'uce. The relevant interest Payment Date will be 3bc 
May, |994. 


Bankers Trust 

Company, London Agent Bank 


Australia and New Zealand 
Banking Group Limited 

.Awtriibiui Cumfuny Number 005 357 522 
( Ituvrparju.il uil/i limited luihlity m die State of Victoria, Australia) 

U.S. $200,000,000 
Floating Rate Notes due August 1994 

Nonce is hereby Riven that for the Interest Period 28th February, 1994 
to 3(*t M.iv. 1994 che Notes will carry a Rate of Interest 
of 4 per cent, per annum wich an Amount of interest of 
U.S. SI02.22 per U.S. SlO.OOO Note and U.S. $1,022-22 per 
U.S. $100,000 Note. The relevant Interest Payment Dare will be 31st 
May. 1994. 


□ 


Bankers Trust 
Company, London 


Agent Bank 


ALLIANCE 4- LEICESTER 
Alliance & Leicester BoiUing Society 
£200.000,000 
Floating Rate Notes 
due 2000 

For rho interest period 25th 
February. I°94 to 25th Mav, 
1 994, the Nntes will carry 
a rote of interest of 5.40% 
per annum with interest 
amount-, of £131. ft? per 1110,000 
and lljlo. 71 per £100.000 
Note, pavable on 25th May. 
1994. 

LimcJ ill i ht LuibbNw !M jA Eulun w 

n BtnlunTiui 

Company, London Agent Beak 






0 Ftnt Interstate Banc&p 

U.S. $60,000,000 
Floating Rate 
Yen-Linked 

Notes due 1996 

For ihc six months 28th Feb- 
nurv, 1 Q*M r„ 2rth August, 
15*4 the Notes mil carry an 
inimsi rale of 4. Wo per 
annum with an interest amount 

01 U.Sl s:w.83 per U.S. 
JlC.lW Nile, payable on Itth 
Au«um. 1*4. 



Banque Indosuez 
U.S. $200,000,000 
Floating Rate 

Notes due 1997 

For the dime months 28th 
February, 1994 to 31st 
May, 1994 the Notes will 
cany an interest rate of 4S.% per 
annum and coupon amount of 
U.S. $103.82 per U.S- $10,000 
Note, and U.S. $2,595.49 pet 
U.S. $250,000 Note. 

U*rJ ao ihc LuxcAbmi Stuck Endon^c 

N Ranker* Tran 

U Company, London tVicotBmb 



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U.S. $300,000,000 



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Notes Due 2000 


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Kmart slips further into 
the red in final quarter 


Viacom lifted by 
rise in European 
MTV subscribers 


By Kchard Tomkins 
bi New York 

Kmart, the US retailing group 

that ranks as the world’s sec- 
ond biggest, has ended a dis- 
mal year by reporting aftertax 
losses of more than $lbn for 
the fourth quarter to January. 

Its shares, up VA at $19% in 
early trading, were close to 
their 12-month low. 

Net losses of SIJSbn for the 
quarter, compared with net 
profits of $535m last time. 

For the year. Kmart reported 
net losses of $974m, against net 
profits of $941m last time 
on sales of $34.2bn, against 
$3lbn. 

A big factor in both sets of 
figures was a protax restruct- 
uring charge of $l.3bn 
announced two months ago. 

However, the company 
acknowledged that the main 
reason for the poor financial 
performance in the quarter and 
the year was an erosion in Us 


By Richard Tomldna 

Federated Department Stores, 
US owner of Bloomingdale's 
and several other department 
store chains, yesterday 
reported that net income 
before extraordinary hems had 
risen by 39 per cent to $146m 
for the fourth quarter to Janu- 
ary. This was in spite of a fall 

ill grOSS margins. 

Federated, like other US 
store groups, has been forced 
to cut prices in tbe intensely 
competitive retailing environ- 
ment. But the group has 
increased profits by selling 


By Robot Gibbons in Montreal 

PWA, parent of Canadian 
Airlines International, suffered 
another heavy loss for 1993. 
However, the airline is predict- 
ing a small loss in 1994 and a 
return to profitability the fol- 
lowing year. 

PWA's consolidated net loss 
for 1993 was C$292m (USS221m) 
or CS6.13 a share, after charges 
of C$1 12m. 


gross margin to 24R per cent, 
from 2&5 per cent last year, 
caused by tbe highly competi- 
tive conditions In the retail 
market. 

During the year, Kmart 
moved to counter five previous 
years of stagnant earnings by 
embarking on a radical 
restructuring. 

It sold its loss-making Pace 
Membership Warehouse and 
PayLess Drug Stores chains, 
announced an reloca- 

tion of its discount stores, 
embarked on the rapid expan- 
sion of its new Super Kmart 
format, and prepared to sell 
minority stakes in its specialty 
retailing operations. 

The shares have responded 
poorly to the moves because 
the market is not yet con- 
vinced that Kmart has found a 
formula that will restore earn- 
ings growth. It is suffering 
tough co m pet it ion in a satu- 
rated market, particularly from 


more goods and cutting 
costs. 

It is trying to secure profits 
growth for the longer term 
through its attempt to gain 
control of the rival RHMacy 
department store group, in 
Chapter 11 bankruptcy protec- 
tion. 

Federated’s fourth-quarter 
turnover rose by 3B per cent to 
$L35bn, with same-store sales 
rising 2.1 per cent Helped by a 
gain of $24m from the favoura- 
ble settlement of disputed 
bankruptcy claims, the com- 
pany increased operating prof- 
its by 29 per cent to $287_6m. 


Operating revenues were 
ry Q7hn This compared with 
a loss of C$543m or C$1137 a 
share, including C$333m 
restructuring charges, in 1992. 
Revenues were C$188hn 
In 1993. strong international 
and charter revenues were 
partly offset by a depressed 
domestic market 
PWA forecasts a small loss 
for 1994 and a profit of about 
C$75m in 1996. 


Kmart said yesterday that if 
continuing operations were 
split from discontinued 
operations and all the restruct- 
uring provisions were stripped 
out, it would have reported net 
income of $534m for the full 
year. 

However, this would still 
have represented a decline 
from $882m the previous year 
on tbe gun** basis. 

frx the fourth quarto:, sate* 
rose to $1027 bn from $8.44bn 
excluding the discontinued 
operations. 

Excluding the restructuring 
provision and other non-recur- 
ring charges, net income from 
continuing operations fell to 
$247m from $50 ltn, or to 
53 cents a share from 
$1.07. 

After all charges, the net 
losses of $1.19bn translated 
into losses of $2.61 a 
share, compared with earnings 
per share of $1.15 last 

Hmn 


Net income of $146m, com- 
pared with $105.1m or $99m 
after extraordinary items. 
Earnings per share were $1.16 
a gahat 83 cents, or 78 cents 
after extraordinary hems. 

Full-year turnover rose by 
2.1 per cent to $7.23hn while 
net income before extraordi- 
nary hems rose by 48 per cent 
to $19d8m. After extraordinary 
items it rose to 8193.2m from 
$U3m. 

Mr Allen Questrom, chair- 
man and chief executiv e, said 
this year’s wn phasis would be 
on accelerating sales growth 
and continued cost-cutting. 


Mr Rhys Eyton, PWA chief 
executive, said: “Once our 
financial restructuring is com- 
pleted in early 1994 our results 
will reflect even farther 
improvement, as expenses 
will benefit from reduced 
aircraft rental and interest 
costs." 

The financial restructuring 
hinges an the C$246m equity 
infusion from American Air- 
lines. 


Aetna hit by 
claims from 
California 
earthquake 

By Richard Waters 

Aetna, the US composite 
insurer, warned ye s t e rday the 
southern Californian earth- 
quake and winter storms 
would cost tt $120m or $1-07 a 
share to the current quarter. 

Hie company put its losses 
from the earthquake at $8Qm, 
mairing ft one of the largest 
losses yet announced by a US 
insurer. 

In all, the cost to tbe insur- 
ance industry of the earth- 
quake is expected to reach 
$2-5bn- 

The expected earthquake 
InuMs, which are after reinsur- 
ance and tax, resulted from 
2,500 claims in the affected 
area, the company said. 

It added that tt expected to 
receive 31.000 claims from the 
winter storms of January and 
early February, with net losses 
put at $40m. 

As a result of these first- 
quarter items, Aetna said it 
would drop its earn tog* fore- 
cast for the year to $5.65 a 
share, from $6.50 a share. 

Olivetti shifts 
Asia Pacific 
base to China 

Olivetti, the Italian computers 
g r o u p , is to lift its presence in 
tbe rapidly growing Chinese 
market by making Beijing the 
base far aD its Asia Pacific 
operations, writes John 
Simkins in 

These operations have previ- 
ously been directed from the 
group’s Ivrea headquarters. 
The company plans to focus 
within rihtwp rm bank automa- 
tion. Olivetti is the leading 
European producer in this 
area. 

Olivetti has been active in 
China since the mid-1980s 
thrangh offices in Beijing and 
Shanghai, and a regional base 
in Hong Kong. 

A joint venture with the 
Industrial Commercial Bank 
of China will produce auto- 
matic teller machines for tbe 
Chinese market. Olivetti will 
have a 40 per cent stake in the 
operation. 


By Richard Waters 
bi New York 

A sharp rise in the number of 
European subscribers to Via- 
com's MTV music video net- 
work was behind an 11 per 
cent advance in operating 
pammg s at the US cable televi- 
sion group last year. 

The company, which wan a 
SLObn takeover battle for Para- 
mount Communications a fort- 
night ago, benefited from a 25 
per cent foil in its debt service 
costs, to $145m, and a reduc- 
tion in Us effective tax rate to 
43 per from 55 per cent 

These factors contributed to 
net income for the year of 
$1532m or $1.31 a share, up 
from $49m or 41 cents in 1992. 

By the end of tbe year, MTV 
Europe had 5&3m subscribers, 
up from 43m, 12 months ear- 
lier. With other parts of the 
MTV Networks division, 
including ffickleodeon, record- 
ing only modest gains in sub- 
scriber numbers, the European 


By David White in Madrid 

Iberdrola. Spain’s largest 
private-sector electricity gener- 
ator. showed an increase of 
almost 12 per cent in its 1993 
pre-tax profit to Pta9l.lbn 
($650m). 

This was in spite of 
Pta34J9bn in foreign exchange 
losses caused by the deprecia- 
tion of the peseta last year. 

Extraordinary gains of 
Ptal2.1bn included tbe sale of 
shares in Fecsa, the Catalan 
utility, and other assets to the 
state-controlled Endesa group 
as part of a reorganisation plan 
for tbe Spanish electricity sec- 
tor. 

Turnover rose 2 per cent in 
the year to Pta767.6bn. The 
company’s hydroelectric out- 
put re covered 42 per cent from 
the previous year's abnormally 
low level but was still below 
average. 

Nuclear energy accounted 
for 57 per cent of total 
output 


performance largely accounted 
for the division's 27 per cent 
revenue increase, to $677.9m 
from $533.4m- 

Operating earnings reached 
$239.7X0, up from $172Jhn 

Showtime. Viacom’s other 
network operation, recorded a 
5 per cent rise in revenues, to 
$543.3m, while operating 
earnings slid to $32. 3m from 
$352X0. 

Earnings fell in the cable 
television division, due to new 
regulations on rates charged to 
subscribers. Revenues rose 1 
per cent to $416m, while oper- 
ating earnings fell 9 per cent to 

For the final three months of 
the year, Viacom's net income 
was $13.6m or 11 cents a share, 
after a $ 12 .am dividend on con- 
vertible stock issued to Nynex 
and Blockbuster Entertain- 
ment, which had backed the 
Paramount bid. 

This compared with net 
income of $ 11 -6m or 10 cents a 
year before. 


• Sonae Group, Portugal's 
biggest private-sector conglom- 
erate, more than doubted net 
profits to Es4£bn l$282m) for 
1993 on turnover ahead 9 per 
cent at Es228bn, writes Peter 
Wise in Lisbon. 

Sonae Distribuicao, which 
takes in the Modelo discount 
supermarket drain and Contt 
nente hypermarkets, achieved 
a 21 per cent rise fn sates to 
Es202bn and a 7 per cent 
increase in net profits to 
Esl3.7bn. 

However, the group’s indus- 
trial operations, centred on 
wood laminate production, reg- 
istered a net loss of Es3.7bn, 
compared with a loss of 
Es3.4bn last time. 

Mr Belmiro de Azevedo, pres- 
ident, announced a dividend of 
Esl50 a share for Sonae Inves- 
timentos, the group holding 
company, compared with Es50 
in 199 2. The dividend for 
Modelo was fixed at Esl40 a 
share and at Es240 for Conti- 
nents. 


its bigger rival Wal-Mart 

Federated Stores advances 39% 


PWA sees return to profits in 1995 


Iberdrola climbs 12% 
despite weak peseta 





iJj d \ I Ujxl I LfljmJ I 



ARAB INTERNATIONAL BANK 


BALANCE SHEET AS AT 30/6/1993 and 1992 


(In thousands of U.S. Dollars) 


AUDITOR’S REPORT 

The Shareholders, 

Arab International Bank. 

We have examined the accompanying 
balance sheets of Arab International 
Bank at June 30, 1993 and June 30 
1992 and the related statements of 
Income and retained earnings and 
changes In financial position for the 
years then ended. Our examinations 
were made in accordance with generally 
accepted auditing standards and 
accordingly, included such tests of the 
accounting records and such other 
auditing procedures as we considered 
necessary In the circumstances. 

In our opinion, the statements 
mentioned above present fairly the 
financial position of Arab International 
Bank at June 30. 1993 and June 30, 
1992. and the results of operations and 
changes in financial position for the 
years then ended, in conformity with 
the accounting policies set out in Note 2 
applied on a consistent basis during the 
period. 

mV < 


Athens. August 20. 1993 


ASSETS 


30/6/1993 

30/6/1992 

UABIIJTTES AND 
SHAREHOLDERS' EQUITY 

30/6/1993 

30/6/1992 

Cash and due from banks 


50.192 

34,022 

Demand deposits 

245.655 

206.808 

Time deposits 


1.312.211 

1.461,452 

Time deposits 

1,679.759 

2.007,414 

Investments: 


MB certificates of deposit 

54,467 

- 

Marketable notes and bonds 

376,077 

291.805 

Accounts payable and accrued interest 

13,066 

27,231 

Equity participations 


99.700 

94.819 

Proposed dividends 

7.000 

6.600 

Loans and advances 

Accounts receivable and accrued interest 

362.150 

14,837 

540,688 

25,929 

TOTAL UABniTIES 

1,999,947 

2.248,053 

Property and equipment 


56.699 

58.217 

Shareholders' Equity: 







Share capital 

175.000 

165,000 





Statutory reserve 

41.602 

40,075 





General reserve 

53,909 

52,325 





Retained earnings 

1.408 

1.479 





TOTAL SHAREHOLDERS' EQUITY 

271.919 

258,879 



2.271.866 

2.506.932 


2.271.866 

2.506.932 

Commitments and 




Commitments and 



Contingent liabilities 


381.418 

314.854 

Contingent Liabilities 

381,418 

314.854 


Mr Mohamed H. Layas 


Dr. Mostafa Khalil 



Managing Director 


Chairman 



HEAD OFFICE: 35 Abdel Khalek Sarwat Street, Cairo .Tel: 3918794 Telex: 92079 ALB, 92098 AIBEX UN Cable Address: Arabinbank Cairo Fax: 3916233 

Alexandria Branch: 2 El Horreya Avenue. Alexandria Tel: 4836775 .Telex: 54431. AIBLX UN Cable Address: Arabinbank. Alexandria 

Port Said Branch: 57 El Gomhoriya Street, Port Said .Tel: 223739 .Telex: 63273 AEBPS Cable Address: Arabinbank PortSaid 

El Tahrir Branch: 1113 Comiche el Nil Street. Cairo Tel: 5743448 Telex: 20113 AIBER. UN Cable Address: Arabinbank, Tahrir 

Heliopolis Branch: 95 Merghani Street, Alshams Tower .Tel: 2902069 Telex: 21718 A1BHL UN 

Mohandessin Branch: 60 Mohamed Hassan Helm! Street, Ex. Guezirat El Arab Street, Mohandessln, Giza Telex: 21316 AIBEX UN Tel: 3029647 
Bahrain Branch: Diplomatic Area. Diplomat Tower Road N 1705. Block 317. Manama, Bahrain Tel: 531611 Telex: 9489 AIBBH. BN, 


t 

* 







FINANCIAL TIMES TUESDAY MARCH 1 1994 

— »NTERNATI0MA»_ companies and finance 


Japanese 

companies 

downgrade 

forecasts 


Strong growth in exports 
helps Daewoo lift profits 


By Emiko Terazono in Tokyo, 
Our Financial Staff In London 
and agencies 

More Japanese companies 
have named that their profits 
for the current financial year 
may not match earlier fo re- 


in the case of Mitsukoshi. 
Japan's most prestigious 
department store, which has 
links with Harnxts of London, 
the pre-tax loss is expected to 
worsen due to poor sales to 
corporate customers. 

The retailer expects a noa- 
consolidated pre-tax lass for 
the year to last month to 
widen to Y&5bn (mm) from a 
previously forecast Y2.3bn. 

Mitsukoshi expects to post 
its second consecutive pre-tax 
loss, highlighting the prob- 
lems facing Japanese depart- 
ment stores amid the current 
downturn In the economy and 
the sharp fall in consumer 
confidence. 

Department stores have also 
faced declines in sales due to 
an increase in competition 
from discount retailers, espe- 
cially in the clothing sector. 

The company said it would 
post an extraordinary loss of 
Y5.1bn due to the liquidation 
of three affiliates, Mitsukoshi 
Restaurant Service, a sports 
clnb, and a Paris-based 
designer brand retailer. 

However it will also post a 
special profit of Y5.8bn from 
assets sales, including a work- 
shop in central Tokyo and con- 
dominiums, which have been 
sold to a real estate affiliate. 

All Nippon Airways warned 
that it would be unable to post 
earlier projected non-consoli- 
dated sales of Y782bn for the 
current year to March. 

Mr Seiji Fukatso, ANA presi- 
dent, said that, although the 
pre-tax profit forecast of YShn 
wonld remain the same, 
annual sales could now total 
only Y750bs. 

In the telecommunications 
industry, Nippon Telegraph 
and Telephone (NTT) foresees 
Its unconsolidated, or parent 
only, pre-tax profit for the 
coming fiscal year beginning 
April 1 tolling by 13 per cent 
to Yl04bn from the Y106bn 
estimated earlier. 

The forecast came as part of 
NTT's business plan for the 
coining fiscal year. The com- 
pany is Japan's largest carrier 
of telep hone calls. 

NTTs president, Mr Masashi 
Kojima, said that, even with 
pre-tax profit of Yl04bn for 
the coming fiscal year, the 
company would have to cany 
forward profit from the cur- 
rent fiscal year to pay its regu- 
lar dividend of Y5.0Q0 per 
share. 

Mr Kojima warned tbat the 
telecommunications giant 
wanted to raise basic monthly 
p ho lie charges and charges on 
telephone directory assistance 
services. 

Kokusai Denshin Denwa, 
Japan's international telecom- 
munications company, said it 
expected Y29tm in current 
profit in 1994-95, starting 
April l, up Ylbu from this 
year. 

KUD said its estimate of cur- 
rent profits for 1993-94 has 
been cut to Y28bn from a 
Y30bn estimate made in Octo- 
ber last year. 

KDD plans to invest Y60bn 
in plant and equipment In 
199-1-95, computed with an 
estimated YMbn tor the cur- 
rent business year. “We expect 
the international communica- 
tions market to remain firm in 
1994-95,” it said. 


By John Burton in Seoul 
* 

Daewoo, South Korea's fourth- 
largest conglomerate, has 
reported a 56 per cent increase 
In net profits to Won298bn 
($368m) in 1893 on sales up by 
35 per cent to Won27,027biL 

The jump in earnings 
reflected strong exports of cars 
and electronics as the Korean 
won fell against the Japanese 
yen. 

The group's securities busi- 
ness also had sharply rising 
profits due to the recovery of 
the Seoul bourse last year. 

Daewoo Corporation, the 
group’s trading and construc- 
tion unit, had a 20 per cent rise 
in profits to Won48.6bn 
because of increased shipments 
of exports. Sales grew by 17 per 
cent to Won9,534bn. 


- Daewoo Electronics’ profits 
increased by 19 per cent to 
WonlStm as sales rose by 15 
per cent to Woa2,000bn, while 
Daewoo Motors cut its losses to 
Won60bn from WonSObn in 
1992 as exports grew by SO per 
cent to 100,000 vehicles. Sales 
increased by 29 per cent to 
Won2^00bn. 

The group's most profitable 
subsidiary is still Daewoo Ship- 
building, although earnings 
declined slightly to Won200bn 
from Won2libn in 1992. Last 
year's fiat profit growth 
reflected sluggish orders 
received in 1992. However, it 
recorded the largest number of 
orders among the world’s ship 
builders last year, indicating 
that earnings will increase in 
1994. Sales were unchanged at 

WonJL554bn. 


Daewoo Heavy Industries, a 
machinery producer, reported 
a 59 per cent increase in profits 
to Woo2&7btt. although soles 
declined by 2 per cent to 
WonSffibn. 

Daewoo Shipbuilding and 
Daewoo Heavy Industries are 
scheduled to merge this year. 

Daewoo Telecom had a profit 
rise of U per cent to Won7Jbn 
on 24 per cent higher sales of 
Won473bn. 

Orion Electric reported earn- 
ings down by 38 per cent to 
WonS-2bn as sales rose by 16 
per cent to Won477bn. 

Daewoo Securities had the 
biggest profit rise among the 
group's main businesses, with 
earnings growing by 64 per 
cent to WonBObn. Sales 
increased by 19 per cent to 
Won440bn. 


— iTUULfM^IUU. TTUUm/JU. 

Government subsidy bolsters 
first-half earnings at Sasol 


By Matthew Curtin 
in Johannesburg 

Sasol. South Africa’s 
oil-from-coal petrochemicals 
producer, reaped rich rewards 
from its R2J>bn investment in 
new chemical projects in the 
half-year to December 25. The 
group reported a 40 per cent 
surge in pre-tax profit to 
RL06bn ($305m) from R759m in 
the same period of 1992. 

The Improvement was 
achieved through productivity 
gains and the rand's weakness 
against the dollar, which lifted 
export revenues. However, the 
robust performance, which saw 
sales climb to R4.67bn from 
RA34bn, includes an estimated 
R450m government subsidy at 
the pre-tax leveL 

Sasol’s synthetic fuel 


operations are compensated for 
any fall tax oil prices below a 
floor of $21.85 a barrel, 
adjusted from $23 late in 1993. 
The subsidy has increased as 
international crude oil prices 
have sunk to new lows of 
below $13 in recent months. 

Mr Paul Kruger, managing 
director, said the investment in 
petrochemicals helped lift oper- 
ating margins while cost cut- 
ting had continued at the 
group’s mines and synthetic 
Aiel operations. 

Mr Kruger added that talks 
on the deregulation of the 
South African oil industry 
were proving to be “difficult, 
slow but going ahead”. He said 
that progress was likely to 
accelerate once a new govern- 
ment Was itisbiUftfi 

Operating income rose to 


Rl.llbn from R822m. The 
exhaustion of tax allowances 
led to a jump in tax provisions 
to R365.8m from R 158. 7m. 
After-tax profit rose 16 per cent 
to R698.7m from R600.3m. 
Gamings improved to 115.9 
cents from 99 cents a share. An 
11 per ce nt Hi gher dividend of 
42 cents against 38 cents is 
declared. 

The group has completed the 
revamp of its Sasol 1 syn/uel 
plant, now dedicated to chemi- 
cal production, and has com- 
missioned the expansion of 
Natref, the Durban ofi refinery 
jointly owned with TotaL 
Meanwhile, production has 
started in this calendar year at 
Politic, the R400m petrochemi- 
cals joint venture with AECI, 
the Anglo American-owned 
chemicals group. 


Pension fund offsets Comalco fall 


By Emffia Tagaza 
In Melbourne 

Comalco, the integrated 
Australian al uminium pro- 
ducer which is 67 per cent 
owned by the country's CRA 
group, yesterday has reported, 
net profits of A$86.7m 
(US$62 .5m) for 1993, more than 
double the previous year’s 
A$42£m. 

The profit was due largely to 
a gain of A$35m from the 
increased value of pension 
fund investments and a A$24m 
fillip from the reduction in 
Australia's company tax rate. 
from 39 per cent to 33 per cent 
However, the group's main 


business operations suffered 
heavily from the steep toll in 
1993 metal prices. Net operat- 
ing profit fell to A$28m, down 
35.6 per cent from 1992's 
A$433m. 

Total sales of A$2.2bn 
showed a slight improvement 
on the A$2bn of 1992, due 
mainly to a rise In sales vol- 
umes in smelting and down- 
stream operations helped by a 
weaker Australian dollar. 

Mr Nidi Stump, group chief 
executive, said the company 
has responded to the global 
oversupply of aluminium by 
slashing production at Bell Bay 
smelter in Tasmania. Mr 
Stump said the plant’s capacity 


of 120,000 tonnes a year would 
be cut by 30% at the end of 
this month. 

The excess world supply, 
along with aboriginal claims 
on Comalco’s mining leases, 
are threatening the short-term 
viability of the company's 
plans to double the output of 
Us main smelter at Boyne 
Island in northern Que ensland. 
Comalco and its partners have 
decided to delay the final deci- 
sion on the expansion project 
until March 3L 

The group has declared a 
fully franked final dividend of 
3 cents a share, making a total 
of 6 cents for the year, up 1 
cent 


Malaysia Airlines share 
sale to MHS approved 


By Kferan Cooks 
in Kuala Lumpur 

Shareholders in Malaysia 
Airlines (MAS), the country’s 
partially-privatised flag carrier, 
have agreed to changes in its 
charter allowing a large stake 
in the company to be sold to 
Malaysian Helicopter Services 
(MHS), at present a company 
dealing mainly in support ser- 
vices for the Malaysian oil and 
gas industry. 

The way is now clear for 
MHS to take up a 32 per cent 
stake in MAS bought late last 
year from Bank Negara, the 
Malaysian central bank, for 
M$1.79bn (US$656 .5m). MHS 


says it intends to fund the pur- 
chase by a public offering of 
new MHS shares. 

MHS is a relatively small 
company controlled by Mr 
Tajudln Ramil, a close busi- 
ness associate of Mr Daim 
Zainuddin, the former Malay- 
sian finance minister reputed 
to be one of Malaysia’s most 
influential business people. 

In recent months MHS has 
been on an aggressive acquisi- 
tion hunt It now has substan- 
tial stakes in a Malaysian ship- 
ping line, 25 per cent Of World 
Airways, the US cargo and pas- 
senger charter company, and 
18 per cent of Pelangl Air, a 
smafi Malaysian airline. 


Strength of yen 
hits Sumitomo 
Rubber result 

By Michlyo Nakamoto hi Tokyo 

The weak state of Japan's 
economy and the rise in the 
yen were blamed for a 32 per 
cent fall in parent company 
pre-tax profits at Sumitomo 
Rubber, a leading manufac- 
turer of tyres. 

Sumitomo, which owns Dun- 
lop in the UK, France and Ger- 
many, 

said the sluggish state or 
Japan’s car industry and 
increasing moves to produce 
cars overseas had adversely 
affected demand for tyres and 
resulted in pre-tax profits toll- 
ing to Y8.04bn ($7&8m) in 1993 
from YlL8bn a year earlier. 


Samsung Electronics doubles surplus 


By John Burton 

Samsung Electronics. South 
Korea's largest electronics 
company, yesterday reported a 
113 per cent increase in net 
profits to Wonl54.8bn ($191m) 
for 1993 as sales climbed by 32 
per cent to Won8.155bn. 

The jump in earnings 
reflected strong export sales by 
its semiconductor division, 
with a 34 per cent rise in turn- 
over to Won2.600bn. 

Samsung is the world's sev- 
enth biggest manufacturer of 

semiconductors and ranks first 

globally in the production of 
memory chips. 

Samsung Electronics also 
makes consumer electronics, 
telecommunications equipment 
and computers. 

Arab bank chief 
to step down 

Arab Banking Corp has con- 
firmed that Us president and 
chief executive Mr Abdulla 
Saudi, a Libyan national, is 
stepping aside effective May 1. 
Reuter reports from Manama. 

"Notwithstanding record- 
breaking results for 1993, the 
board or directors reluctantly 
agreed with the president ana 
chief executive that, owiug to 


external circumstances, such a 
decision was necessary to pro- 
tect shareholders’ interests and 
safeguard the bank's future,” 
the bank said. 

The board has • appointed 
Khalifa al-Muhairy, co-deputy 
chairman of the bank, to chair 
a committee which will be 
entrusted with the responsibili- 
ties of chief executive officer 
pending a permanent appoint- 
ment, it added. 

Woodslde unit to 
axe 430 jobs 

Woodside Offshore Petroleum, 
part of the Australian oil and 
gas producer and the operator 
of the North West Shelf gas 
project, is to axe around 430 
jobs as part of a restructuring 
of its Western Australian 
operations, writes Nikki Tait 
in Sydney. 

White knight for 
Aztec Mining 

Pancontinental Mining, the 
diversified Australian mining 
house, has emerged as a “white 
knight” for Aztec Mining Com- 
pany. the Sydney-based miner 
confronting an unwanted 
AS261m (US$lS8m) bid from Mr 


Robot Champion de Crespig- 
ny’s Poseidon Gold, writes 
Nikki Tait 

Aztec is recommending an 
all-paper offer from Panconti- 
nental of six Pancontinental 
shares and three Pancontinen- 
tal options for every 16 Aztec 
shares. The options have a 
strike price of A$2.30 and 
expire at end-June 1997. 

Based on the average price 
for Pancontinental over the 
past week, the offer is worth 
around A$0.76 per Aztec share, 
valuing the company at 
A$292 ul PosGold's cash bid is 
pitched at A$0.68 a share. 

Critically, the new offer has 
the backing of Aztec's major 
shareholder, the US-based AIu- 
max group, which holds 37 per 
cent of the shares. 

MetaUgesellschaft 
and MEM to swap 

MM Holdings, the Australian 
metals group, and Germany's 
MetaUgesellschaft have finali- 
sed the agreed exchange of cer- 
tain jointly-held zinc interests 
in Germany, so that the differ- 
ent assets - MHD "Berzelius" 
Duisburg and Ruhr-Zink - end 
up being full owned by one or 
other company, writes Nikki 
Tait 


The deal was announced 
before the extent of the finan- 
cial problems at Metallgesells- 
chaft became apparent, 
although MIM subsequently 
expressed confidence that the 
deal would be completed as 
planned. 

Agfa-Gevaert in link 
with Daiei 

Daiei, Japan's largest super- 
market chain, has linked with 
Agfa-Gevaert, the German pho- 
tographic film maker, in an 
attempt to break into Japan’s 
ti ght ly held film market with 
an inexpensive German-made 
product branded under Its own 
name, writes William Dawkins 
in Tokyo. 

The film will retail at a 60 
per cent discount to average 
photographic film prices, said a 
Daiei spokesman. On the 
strength of this the company 
Daiei is planning to achieve a 
market share of around a 3 per 
cent in the first year. 

Currently, the Japanese pho- 
tographic film market is domi- 
nated by Fuji, with a 70 per 
cent share, followed by Kodak 
and Konika with just under 30 
per cent combined, and Agfa- 
Gevaert with less than 1 per 
cent 


23 


HiiiiiiiimiumfiiuiiiiiifiimfiiUHnmiiivimffMiiiiiiiifitiiiifmiMifffviif 

End of Month S.G. Warburg Warrant Valuations 


as at 28th February, 1994 


Single Stocks 

TYPE 

CURRENCY 

SPOT 

STRIKE 

PRICE 

EXPIRY 

BHP 

Call 

AUD 

17.98 

19.50 

1.65 

29th Jun 95 

Dao Hang Bank 

Cali 

HKD 

28.70 

32.00 

0.78 

25th Jan 96 

Hutchison Whampoa 

Call 

HKD 

34.80 

36.00 

1.01 

2 1st Dec 95 

Hysan Development 

Gail 

HKD 

26.30 

17.00 

11.20 

6ch Sep 95 

Saipetn Capped Call 

ITL 

3183 

4246 

325 

30th Mar 95 

Sip 

Cal! 

ITL 

4148 

3832 

1160 

14th Jan 96 

Sue 

Baskets 

Call 

ITL 

4558 

4725 

892 

14th Sep 95 

European Airlines 

Call 

£ 

437 

320 

13.22 

3rd Feb 95 

UK Banks 

an 

£ 

103.00 

114.75 

0.85 

1st Jun 95 

European Multi-Media 

an 

£ 

2269 

2028.57 

3.6S 

28th Sep 95 

European Multi-Media 

Call 

£ 

2269 

2475 

2.44 

28th Sep 95 

UK Pharmaceuticals 

Call 

£ 

100.00 

98.05 

2.09 

26th Jan 95 

UK Support Services 

an 

£ 

95.10 

107.50 

0.91 

2nd Aug 95 

UK Water Companies 

Can 

£ 

102.00 

104.75 

1.01 

5th May 95 

European Steels 

an 

DM 

3363 

2550 

95.82 

12rh Jan 95 

Italian Industrials 

an 

ITL 

17294 

19665 

373 

31st Aug 95 

Indo-China 

Indices 

Call 

USD 

1.04 

1.00 

0.27 

Sth Dec 95 

FTSE M id-250 Index 

an 

£ 

3960 

2900 

10.61 

18th Mar 94 

FTSE Mid-250 Index 

Call 

£ 

3960 

3200 

7.63 

18th Mar 94 

FTSE Mid-250 Index 

Call 

£ 

3960 

2900 

10.87 

17th Mac 95 

FTSE Mid-250 Index 

an 

£ 

3960 

3470 

6.13 

17th Mar 95 

FTSE Mid-250 Index 

Call 

£ 

3960 

3670 

4.77 

17th Mar 95 

FTSE Mid-250 Index 

Call 

£ 

3960 

3900 

3.46 

17th Mar 95 

FTSE Mid-250 Index 

ail 

£ 

3960 

3945 

4.70 

17th Jan 96 

FTSE Mid-250 Index 

Put 

£ 

3960 

2900 

0.10 

18th Mar 94 

FTSE Mid-250 Index 

Put 

£ 

3960 

2600 

0.10 

18th Mar 94 

FTSE Mid-250 Index 

Put 

£ 

3960 

2900 

0.10 

17th Mar 95 

FTSE Mid-250 Index 

Put 

£ 

3960 

3470 

l.U 

17th Mar 95 

FTSE Mid-250 Index 

Put 

£ 

3960 

3270 

0.65 

17th Mar 95 

FTSE Mid-250 Index 

Put 

£ 

3960 

3900 

2.71 

17th Mar 95 

Relative Performance 

Volvo/OMX 

an 

SEK 

+17.5% 

-10% 

354^0 

23rd Feb 95 

Volvo/OMX 

Call 

SEK 

+17.5% 

+/-0% 

294.00 

23rd Feb 95 

Volvo/OMX 

Can 

SEK 

+17.5% 

+10% 

240.80 

23rd Feb 95 


S.G Warburg 

S.G. WARBURG GLOBAL 
EQUITY DERIVATIVES 

FOR INFORMATION CONTACT JUSTIN CHITTENDEN ON 071-260 0517 REUTERS PACE: WARE 

iiiiiiumifmiHmiiimiiiiiiMfimiiiriiinimifiiiimiinimiiiiimiiiiinmi 


Halifax Building Society 

S100.000.000 
Collared floating rate 
notes due 2003 

Notice is hereby given that 
the notes will bear interest at 
7% per annum from 25 
February 1994 to 25 August 
1994. Interest payable on 
25 August 1994 wiU amount 
to 5347.12 per 510.000 note 
and 53.471.23 per 5100.000 
note 

Agent: Morgan Guaranty 
Trust Company 

JPMoigan 


Bradford 

*B INC LEY 

5100,000,000 
Floating rate notes 1996 

Notice is hereby given that 
the notes will bear interest 
at 5.4% per annum from 
25 February 1994 to 25 May 
1994. Interest payable on 
25 May 1994 will amount to 
5131.67 per 5 10.000 note. 

Agent: Morgan Guaranty 
Trust Company 

JPMorgan 


Republic of the 
Philippines 

US$5,313,000 Series 1992 A 
Floating rate bonds 2010 

The A Bonds wiU bear interest 
at 4.8125 % per annum for the 
period I March 1994 to 
I September 1994. interest 
payable on 1 September 1994 
per US$1,000 note wiB amount 
to USS24.60. 

Agent Morgan Guaranty 
Trust Company 

JPMorgan 


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0030 

1438 

17.42 

17.42 

0100 

1440 

2478 

22J8 

01X 

1443 

2500 

27.48 

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1443 

2450 

27X8 

0230 

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2104 

23 02 

0000 

1440 

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3330 

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1726 

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1484 

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17.02 

2128 

2304 

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2432 

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2104 

2432 

iooo 

17.72 

21.74 

2471 

1030 

17.72 

21.74 

2471 

1100 

17.72 

21.74 

2471 

1130 

17.72 

2438 

2504 

1200 

17.72 

2438 

2504 

1230 

17.72 

2438 

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1300 

17JS 

2438 

2504 

1330 

17-33 

21-73 

2471 

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1736 

21.73 

2471 

1430 

J7JO 

17.44 

17.44 

1500 

1702 

17A4 

17X4 

1530 

1448 

17X4 

17.44 

1000 

1704 

17.43 

17X3 

1930 

1447 

17X5 

17X5 

1700 

2031 

1904 

1004 

1730 

3333 

3288 

3500 

1800 

33.77 

3412 

35.10 

1030 

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30X4 

3207 

1900 

2455 

25.72 

27.77 

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2038 

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COMPAGNIE BANCAIRE 

Societd Anonyme 

Incorporated in France with limited liability. 

Regd. Office; 5 avenue Kidder. Paris 16dme. 

NOTICE OF ORDINARY AND EXTRAORDINARY GENERAL MEETING 

The shareholders of Compagnie Bancaire are invited to 
attend the Ordinary and Extraordinary General Meeting to be 
held on Wednesday, 23rd March, 1994 at 5.00 p.m. at the Head 
Office. 5 avenue Klbber. Paris 1 6dme. to consider the following 
Agenda: 


- The Report of the Board of Manac 
current activities and position of u 


ament on the 
a company. 


- The Report of the Auditors. 

- The comments of the Supervisory Board. 

- The approval of the accounts for 1993 and 
appropriation of profits. 

- The option to pay the dividend in the form of shares. 

- The renewal of the mandate of the auditors. 

- The authorisation of the Board of Management to buy 
and sell shares of the Company on The Stock 
Exchange in order to regulate their price. 

- The renewal of the authorisation delivered to the 
Board of Management to issue convertible securities. 

- The reduction of the duration of the mandate of the 
members of the Supervisory Board and the censors 
and the corresponding change of the statutes. 

- The ratification of the co-optation of a Supervisory 
Board's member. 

- The ratification of the co-opTaiion of a Supervisory 
Board's member and the renewal of his mandate. 

- The renewal of a censor's mandate. 

- The nomination of three censors. 

- Any other business. 

- Authorisation to implement the above procedures 

In orderto attend or be represented at the Meeting, owners 
of registered shares must have been entered on the register five 
clear days prior to the Meeting. Holders of bearer shares must 

[the Head 


Office, the certificate of deposit, issued by the bank, financial 
institution or stockbroker with whom the shares are lodged. 

Postal votes must be received at the Head Office of the 
Company on the appropriate form six days in advance of the 
meeting. 

Shareholders who wish to attend the Meeting are 
requested to make advance application to the Company For an 
admission card. 


Kleinwort Benson 

Kleinwort Benson Private Bank is pleased to announce that 
with effect from 1st March 1994 the Mortgage Management 
Account interest rate will reduce to 7.25% per annum. 

Kleinwort Befwxn Private Bonk b a Divi»*m of 
Kleinwort Benson Investment M^rugem-nt Umltt.il 



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24 


FINANCIAL TIMES TUESDAY MARCH I 19 * 4 - 


INTERNATIONAL CAPITAL MARKETS 


German repo move sparks tentative recovery 


By Conner Mdcteknann 
In London and Patrick 
Harverson In New York 

After last week's sell-off, most 
European government bond 
markets firmed slightly yester- 
day. However, with long-term 

GOVERNMENT 

BONDS 

investors still sidelined and 
cash ifawiing B i-hin , dealers said 
the consolidation remains frag- 
ile. 

■ German government bonds 
sparked the early rally, fuelled 
by hopes for tmminwnf credit 
easing after the Bundesbank 
called for bids on variable-rate 
securities repurchase agree- 
ments. 

After three months of freez- 
ing the repo rate at 6 per cent, 
the central bank's return to 
variable-rate repos - where 


banks bid what they are will- 
ing to pay - raised hopes that 
the repo rate could continue to 
edge lower. 

However, dealers were split 
over the likely extent of the 
easing at today's repo alloca- 
tion. While some expect the 
rate to fall by between five and 
10 basis points, others said 
banks might bid very cau- 
tiously given recent money 
market tightness. 

Bidding is further compli- 
cated by the fact that the 
Bundesbank’s lower minimum 
reserve requirement takes 
effect today, releasing substan- 
tial liquidity. 

Bunds’ strength was under , 
pinned by strength in the US 
Treasury market on encourag- 
ing comments from Federal 
Reserve Board governor Law- 
rence Lindsey. - 

However, traders started tak- 
ing profits in the afternoon, 
dragging taking the March 
Bund future back below 97.00, 


which is seen to make it tech- 
nically vulnerable to the down- 
side. 

Comments from Bundesbank 
council member Mr Otmar iss- 
Ing exacerbated late weakness. 
In an interview with AP-Dow 
Jones, he said January M3 
money supply could be in the 
double digits, well outside the 
Bundesbank’s 4-6 per cent 
target range. The numbers 
are expected to be released 
in the second half of thin 
week: 

A further pressure on bunds 
was impending supply, with 
the Treuhandanstalt due to 
issue new bonds today. Most 
traders expect some DMIObn of 
10-year paper, but say it is 
likely to meet a lukewarm 
r ec epti on . 

“Most of the bonds will 
probably land on banks' books 
- investors are still quite 
wary and there’s just no 
retail demand,” said Mr 
Torsten BQhler. senior 


bond analyst at UBS. 

B French government bonds 
tracked Bunds higher. Inspired 
by hopes that a lower German 
repo rate might give the Bank 
of France fresh scope for eas- 
ing after last week's small 0.10 
point cut in the intervention 
rate, to BJ.0 per cent 
The March notional OAT 
future rose 0.92 point to 12&96, 
though it fell back to around 
126.76 in after-hours trading. 

■ UK gilts held on to most of 
their gains, with the March 
long gilt future closing at 113ft, 
up % point on the day. “It was 
a quiet day - we saw some 
buying, but not in great size," 
said a gilt salesman at a huge 
UK bank. 

■ Japanese government bonds 
held on to their soft tone ahead 
of today's release of the Bank 
of Japan's quarterly Tankan 
economic report, and the auc- 


tion of 10-year bonds. Mr 
James Greener, economist at 
Toyo Trust, said he expected 
some YlJ200bn of 4J, per cent 
10-year bonds to be sold. 
"Retail demand Is likely to be 
very slack - especially after 
the disappointing four-year 
auction last week.” 

■ US Treasury prices firmed 
slightly across the board 
yesterday morning in the 
wake of a report from Chicago- 

area pw riianiny nmnag Hrs that 

was moderately bullish for 
bonds. 

By midday, the benchmark 
30-year government bond was 
up ft at 94ft, yielding 6.689 
per cent. The two-year 
note was also higher at the 
halfway mark, up ft at 99%, to 
carry a yield of 4J375 per 
cent. 

After finning overnight, doe 
to buying in Tokyo, Treasury 
prices received another modest 
boost in the New York morn- 


ing session, after the Purchas- 
ing Management Association of 
Chicago reported a 59.6 per 
cent rise, to 60.3 per cent. In its 
February index of . business 
activity in' the region,' 
Although an increase had been 
expected, what pleased bond 
dealers and investors was -a 
decline in the price and 
employment components- of the 
purchasing managers’ index. 

Traders said the -data, might 
normally have had little 
impact upon the market How- 
ever, with bonds looking over- 
sold in the wake of recent 
heavy losses, it-cmly took the 
slightest piece of good news to 
attract buyers. - 

The market was also relieved 
that, following a worrying Phil- 
adelphia Federal Reserve 
report that pointed to rising 
prices in the region, yester- 
day’s Chicago purchasing man- 
agers report said prices locally 
showed signs of easing in Feb- 
ruary- 


Volatility, interest-rate uncertainty deter borrowers 


By Sara Webb 

A handful of borrowers 
announced plans yesterday to 
tap the international bond 
markets. However, on the 
whole, new issue activity 
remained rather subdued in 
the wake of the recent turbu- 

INTERNATIONAL 

BONDS 

lence in Europe’s financial 
markets and uncertainty over 
US interest rates. 

Ontario Hydro, the largest 
electricity utility in Canada, 
plans to launch a C$lbn global 
floating-rate note (FEN) with a 
five-year maturity. Merrill 
Lynch, the joint bookrunner, 
said the deal would provide 
investors with the first sub- 
stantial FRN offering in Cana- 


dian dollars. Ontario Hydro, 
which has an Aa2/AA- credit 
rating, has an expected bor- 
rowing requirement of between 
C$2bu and C$&8bn per annum 
over the next three years. 

Given that the US Federal 
Reserve has already raised 
short-term interest rates, and 
the somewhat uncertain Inter- 
est rate background, Merrill 
said It expected to see demand 
for the FRN from investors 
who want exposure to Cana- 
dian dollars, and who are 
expecting a similar rise in 
Canadian short-term interest 
rates. 

Waiting in the wings for 
more suitable market condi- 
tions is a |500m, 10-year fixed- 
rate Eurobond issue from the 
African Development Bank. 
The hank is a relatively rare 
borrower in the international 
bond market the proceeds will 


be used for general treasury 
purposes. 

Kreditanstalt fur Wiederauf- 
bau, known as KfW, 
announced yesterday it would 
delay the launch of its much- 
publicised dragon bond issue 
until market conditions had 
stabilised. 

KfW, with a triple- A rating; 
has been planning to bring a 
9300m, five-year fixed-rate 
dragon bond to Asian inves- 
tors, but decided to delay the 
issue because of the current 
weakness in the US Treasury 
bond market 

Meanwhile, undeterred by 
the market conditions. Interna- 
tional Telecommunications 
and Satellite Organisation 
(Intelsat), launched a 8200m, 
10-year dragon bond Issue 
priced to yield 37 basis points 
over the US Treasury bond. 

Nationwide Building Society 


NEW INTERNATIONAL BOND ISSUES 


Amount 

Cotqwn 

Price 

Mtatnrtly 

Few 

. Sprawl 

Booic. runr 

Dot TO mer 

US DOLLARS 

RL 

% 



%' 

*v 


ooctt 

250 

H 

9&74R 

Mar. 1997 

aim 

- 

CS Ftot Boston 

tncebac 

ZOO 

&82S# 

0O84R 

MarJSOtM 

032SR 

+37 GokfiTWi Sachs (Atfe 

Tomohu CoJ>4<t> 

100 

1JJ0 

10CLOO 

Mar. 1996 

SJ3S 

- 

NM40 Europe 

STERLMQ 

NataarwMe B7S(c^t; 

rnanram 

« 

100.00 

Oct.1998 

imSecL 


Bering Brothers . 

Morgan Stanley Greupt 

150 

W 

99.765R 

Mar.1996 

0L175H 

- 

Morgan Starlay WL 

YEN 

Koran Development Bank 

20 bn 

4.70 

too XX) 

Ma-3XK 

ABES 

_ - 

Bade at Tokyo CapL Meta. 

CANADIAN DOLLARS 
DMBW 

125 

(L0Q 

10O285R 

Doc.1997 

Q20R 

+10 « 

ScoBaMcLaod 

Final tanrts and norv+aSatria untaes etatad. The yMd apraad (over relevant government bond) as launch la aupt£cd by the lead 
manonra. CWtth eqirity Marram. tfloMag rata note. •Semi-annual onraara R; 9xad ra-oflfer price; Haas we Naomi at ttie ra-a(Mr leveL 

a} a-mth Libor +VL96. b) Ffadno: 8/2/94- e) Short 1st coupon, d) Critobie' on oaupon dam Irani Apr.95 at par. el 3-tntti Lbar +0.1%. 0 

Over IrKwpotfltod yfakl 









is redeeming a 1300m issue of 
floating-rate notes early, and is 
offering investors the chance 
to switch into a new issue ou 
slightly more att rac tiv e terms, 
which effectively gets rid of 
the 5 per cent floor. 


The issue was launched in 
1988 and is due to mature in 
October 1996. It had a coupon 
Of LtbOT plus 8 basis . 

points, and had a Door of 5 per 
cent 

The new issue, which will be 


tor up to £30Gm, is paying a 
coupon of Ubor plus 10 basis 
points and will also mature in 
October '1996. Baring Brothers, 
the lead manager, said there 
was a shortage of paper matur- 
ing in 1996. 


DTB lifts margin 
requirement 
on bund future 


By Connor Mkkfeknann 

The German futures and 
options ' exchange (DTB) has 
increased the margin require- 
ment on Its government bond 
futures contract and its DAX 
stock index future. 

The move follows the recent 
rise in volatility in Germany’s 
bond and stock markets. An 
official said tire new margin 
requirement took effect yester- 
day, and would remain in force 
until toother notice. 

"The 30-day volatility in the 
bund future was higher than 
we had assumed Under our 
worst-case scenario,” the DTB 
said. 

"Last Thursday, the [March] 
contract dosed 106 ticks below 
the previous day’s dose, while 
our', worst-case scenario 
assumed a maximum move of 
only 100 ticks,” it said. 

Margins represent the collat- 
eral that' an investor must 
deposit to secure an invest- 
ment position. 


The DTB’s margin on the 
bund future was raised to 
DM3JX» (the equivalent of a 
120- tick move on the future) 
per o uuLra ct from DM2,500 (100 
ti cks) The margin on the DAX 
future was Increased to 
DM13.000 (130 index points) 
from DM11,000 (110 index 
paints). 

Europe’s other _ large 
exchanges are not envisaging 
similar moves. 

"The Mrftang B is not plan- 
ning to chang e its initial mar- 
gin on the bond future,” said a 
Tjffo cfflrfoi, noting there was 
always the possibility of mak- 
ing intraday margin calls at 
times of high volatility. Liffe’s 
initial ma rg to requirement on 
the bund future is currently 
DM2,000- 

“We are constantly monitor- 
ing volatility levels to ensure 
the margin requirements are 
appropriate, but for the 
moment we are not consider- 
ing any chang es , ” a Matif offi- 
cial said. 


Thai bank plans $400m 
Euro-convertible issue 


ByWBhnn Barnes In Bangkok 

Thai Farmers Bank is to raise 
3400m with Euro-convertible 
debentures to help fund its 
long-term growth plans. The 
move comas in spite of fears 
that a rush of recent issues 
may have temporarily satu- 
rated the marled. 

. The bank’s executive chair- 
man, Mr Banyong Tjrmmm r 
said there was still enough 
rtamawil from foreign and local 
investors to take up the issue. 

He said the market’s appetite 


for convertible debentures with 
a 10-year maturity, non- 
convertible debentures or war- 
rants, or a mixture would dic- 
tate the nature of the offer. 

Thai companies raised JL4bn 
through Euroconvertibles in 
1993, following an easing in 
Thai financial regulations. 
However, the dubious quality 
of same issues, the stalling of 
the local stock market, and the 
increase in global interest 
rates may have taken much 'of 
the wind out of this particular 
fund-raising channe l. 


WORLD BOND PRICES 


BENCHMARK GOVERNMENT BONDS 

Red Day's 

Coupon Date Price change 

Yield 

Week 

ago 

Monft 

ago 

AurMa 

9JS0O 

oaw 

116J400 

*0280 

891 

872 

818 

BNgkm 

7250 

04A4 

102.1000 

+0.500 

895 

893 

852 

Canada * 

0500 

06704 

06.5500 

+0250 

828 

894 

833 

Denmark 

TSX30 

12/04 

1029500 

+0.680 

860 

849 

802 

France BTAN 

8.000 

058)8 

1089200 

+0295 

842 

542 

810 

OAT 

5£Q0 

04/04 

64.9900 

+0.460 

818 

629 

869 

Germany 

6.000 

09403 

99J3500 

+0200 

809 

801 

873 

(cafy 

BJSQO 

aii 04 

94L4090 

-a 720 

goer 

864 

841 

Japan No 119 

4.800 

08/99 

106.4400 

-0290 

837 

320 

221 

N0 157 

■L500 

06AB 

10&Z700 

0.080 

320 

328 

3.46 

Nelharimfa 

5-750 

01AM 

97^600 

+0890 

828 

802 

887 

Spain 

10.500 

10/03 

111.7500 

+0200 

884 

8.47 

722 

UK OKs 

87100 

08/B8 

98-10 

+15AK 

622 

828 

870 


6.750 

ITAM 

98-26 

+£1/32 

893 

880 

821 


9.000 

10/08 

118-26 

+31/32 

7.13 

724 

856 

US Treasury ' 

5J75 

Q2A34 

97-25 

+1/32 

818 

805 

521 


6550 

06/23 

94-06 

- 

870 

861 

820 

ECU (French Govt] 

a coo 

04AM 

657)000 

+0.900 

858 

829 

528 


Italy 

■ NOTIONAL. ITALIAN QOVT. BOND (BTP) FUTURES 
(UFH3* Lira 200m lOOtfw of 100% 


FT-ACTU ARIES FIXED INTEREST INDICES 

Mob hdbM - Mon Day’s Fri Accrued xd act 

UK oats fab 28 change % Ftb 2S M*m ytd 


— - Low co u pon yield Madura ooqno iWd Hah coupon yield — 

Fob 38 ftfa2S.Vr.aao Fab 28 Fab 25 Yr. ago Fob 28 Fab 2S Vr. ago 



Open 

Sett prion 

Cfiova 

High 

Law 

Eat vat 

Open fat. 

1 

Up ta S paara(2S} 

12725 

+023 

13898 

120 . 

227 

Syw 

833 

843 

853 

854 

804 - 

623 

885 

875 

829 

Mar 

11325 

11228 

+029 

11320 

112.00 

49497 

69759 

2 

5-15 yesn {24} 

16818 

+0.66 

154.16 

129 

2.62 

15 yw 

77H 

7.10 

7.72 

7.12 

723 

821 

72* 

744 

843 


11865 

112.89 

-801 

11866 

11221 

15880 

61947 

3 

Over 15 years ( 0 ) 

17873 

+1.07 

17426 

848 

3-53 

20yra 

7.12. 

721 

801 

7.12 

723 

839 

726 

725 

852 

Sep 


112.79 

-801 


0 

1 

4 

kiedeemsblos (6) 

20022 

+127 

20820 

2.40 

1.12 

Irradt 

720' 

720 

846 











5 

AI stocks (81) 

150.69 

+0.61 

149.74 

1.86 

256 











■ ITALIAN CKIVT. BOND (BTR FUTURES OPTIONS (LIFTC) Lba200m lOOths of 10096 








. — 

— Inflation 5% — 

— 

— 

taSaQatt 10% 

— 



Strife 


CALLS 


PUTS 


Price 

Jun 

Sep 

- - - Jun- r *' 

Sep 

11260 

256 

224 

2.17 

2^ 

11300 


229 

240T 

260 

11350 

2.04 

818 

229 

227 


Em. voL total. Cato *78 Puts 1802. Piwvtoua day's opal UK, CMta *0612 Pun 41313 


Loldoa doting, Haw York mid -tty 


YMdti local maitaM otmtanj. 


t (ton mud yMd pndtoang waMnktog tn» ■ izs par mat peysUo by nanra ti doni ri 
Nook US. UK In 3&xfc. aBnra hi dechni Stuck MM8 tatamtitanti 

US INTEREST RATES 

Lunchtime iWw 


■ NOTIONAL SPANISH BOND FUTURES (MOT) 


Bntiartaanata . 
RsLUsh. 



(taaaxnUI—-. 

Treasury Bis and Bond YWds 

314 Tto ytm 

— 4H 

S 

Two mooti — 
Onaonrii— 

144 Rwyear 

821 

559 

3% 

SharaOi — 
Ora yea- 

lO+par 

328 sum 

8(8 

MS 


MAnfc it hmwan_ 

BOND FUTURES AND OPTIONS 

France 

■ NOTIONAL FRBKHBOM) FUTURES (MATIF) 


Mar 

Jun 


UK 


□pan Sea price Change Ugh 

101.80 101.79 +005 1CKL20 

101.95 101.00 *030 101.96 


Low Eat vc* Open ML 
101.50 64JS22 123.623 
10130 4,919 37,763 


■ NOTIONAL UK Q0.T RITUHES (UFFB* ESQflOO 32nda of 100% 



Open 

Sett price 

Change 

Hgh 

Low 

Eat vd 

Open M. 

Mar 

113-10 

113-16 

+0-22 

113-23 

113-02 

70138 

88577 

Jun 

112-10 

112-22 

+0-21 

112-28 

112-08 

32560 

104288 

Sep 


111-28 

+021 



0 

0 


■ Ulira nmJHBS OPTIONS £JflF3 £90000 04tfaaMOO% 


Jur 

Sap 


Open Sett price Change Ugh 
126.40 12868 +0-32 12656 

126.02 12S62 *090 120.58 

12520 12S.78 +090 12650 


Low 


12546 

125.18 


■ LONG TERM FRENCH BOM? OP7K3NS (MA77FJ 


Eat WL 
181,485 

Open int 
158974 

SMfce 

Price 

Jun 

■ CALLS 

Sep 

Jun 

. puts 

Sep 

13283 

61292 

112 

2-19 

2-45 

1-39 

2-67 

407 

10348 

113 

1-50 

2-18 

2-06 

3-28 


114 

1-22 

1-66 

2-42 

403 


SMra 

Price 

Mar 

- CALLS - 
Jun 

Sap 

Mer 

i* 

1 

Sep 

127 

0-63 

156 

1.12 

865 

108 

. 

128 

828 

865 

878 

- 

1.56 

2J8 

128 

80S 

839 

- 

- 

215 

2B9 

130 

- 

820 

- 

- 

284 

272 

131 

- 

0.10 

0^2 

- 

- 

- 


EM. wL tab*, am 8098 Putt 8881. Pnnfaua (My* m taL. Ctita 44740 Ptta 37768 


Ecu 

m ecu BOND FUTURES flUATff} 


EM. voL IDOL am 27540 Puts 78.722 . Pierian day’s open ML. Cda 2*7.600 Ara 1885+1. 

Germany 

■ NOTIONAL GERMAN BUND FUTURES [UFFq* PMZSO.OOO IQOttia of 100% 


Open Sett price Change High Low EsL voL Open W. 
117.00 118.18 +0.76 118.16 117.88 4.128 14J02 

9268 *042 311 



Opm 

Sett price 

Change 

Wgn 

Law 

EsL Ml 

Open hit 

Mar 

9868 

96-93 

+864 

9720 

3863 

163248 

179700 

Jun 

9650 

9865 

+085 

96.90 

9835 

46145 

91312 

Sep 

3840 

9852 

♦084 

9878 

9834 

229 

3166 


Mar 
Jui 

US 

■ US TREASURY BOND FUTURES (CST) Si 00.000 32nda of 100% 


■ BUM WJTUBE3 OPTIONS (MFFgDM2S0nm porta of 100% 


Strike 

Price 

Jin 

■ CALLS 

Sep 

Jun 

- PUTS 

Sep 

SHOO 

121 

1.42 

1.06 

1.40 

9700 

897 

1.18 

132 

128 

9750 

876 

899 

181 

127 



Op»i 


Change 

Mgh 

Low 

EsL WL 

Open kit 

Mar 

111-21 

111-31 

+0-11 

112-01 

111-21 

351,565 

288,171 

Jun 

110-22 

110-30 

+0-11 

111-01 

110-21 

78456 

117235 

Sep 

109-24 

110-00 

+0-05 

11003 

103-34 

559 

34,120 


EM. ML U8. Cola 16644 Adn 20838- Pfemfcu) days open W_ Oato 178864 Pols 167018 

■ NOTIONAL MEDIUM TERM GERMAN GOVT. BOND 
(BOBUflJFFQ- DM250000 lOOths of 1Q0% 


Jun 


Open Son price Ctenge 

loi.io loins + 0.44 

101.13 101.17 +0.42 


«gh 

101.17 

101.26 


Low 

10095 

101.13 


EsL voi Open irt. 
666 8306 

139 583 


Japan 

B NOTIONAL LONG TERM JAPANESE QOVT. BOND FUTURES 

CLIFFQ YIQOm lOOths of 100% 

Open Ctoae Change Ugh Low EsL voi Open M. 
Mar 112J36 11282 112.50 S50 0 

Jun 11187 111.70 11125 2467 0 

* UFFE u o mm.t » hadtd on APT. am Open Manat Bgi are tr pravku* d ay. 


UK GILTS PRICES 


Bc8 13*zpc ISM 

Tm.iQKbL ifflttt— 

ErdH2%pcra94 

Treat 

12pcl995 _ 

Bail 3 k Sb 80-45 

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Mjt 19 96— 

Btfiayp ciMett 

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tot 

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7.73 

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SS "S 

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6 Up to 6 yaaraR) 

7 Oner 5 years (11) 

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£37 804 823 803 017 803 

Madura! 8%-IOMM: rtgft: 11% and am. t FM ytekL yld Year M dMe. 


901 


FT FIXED INTEREST INDICES 

Fab 28 Feb 25 Feb 24 Feb 23 Feb 22 Vf ago Hgh* Low- 

Oort. Sac*. (UK) 10121 10125 10094 10054 10223 9728 10720 9328 

Fboed kdaraet 12207 123.78 12429 12528 12652 112.19 18387 108.87 


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FT/tSMA INTERNATIONAL BOND SERVICE 


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US, DOLLAR S1MGH13 

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AnUaahOO 400 111% 


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% 







FINANCIAL IZVESTIA 

TALKS BUSINESS TO 300,000 INFLUENTIAL 

RUSSIANS EVERY THURSDAY. 


Financial Izvestia is an 8-page weekly business newspaper 
produced by the Financial Times in partnership with Izvestia, Russia’s 
leading independent daily. 

Printed on the FT’s distinctive pink paper, it accompanies 
Izvestia every Thursday. 

Drawing on the huge editorial network of both newspapers, 
it brings up to the minute,' accurate, national and international news to 
300,000 decision makers in Russia. News from around the world that 
impacts upon the Russian market, making Financial Izvestia an 
essential and unique business tool for those shaping the new Russia. 

To find out more about advertising to these influential people 
call Ruth Swanston at the Financial Times in London on 44 71 873 4263 
(fax 44 71 873 3428), Stephen Dunbar- Johnson in New York 
on 1 212 752 4500, Dominic Good in Paris on 33 1 42 97 06 21, 
Sarah Pakenham- Walsh in Hong Kong on 852 868 2863. 

Tinancialtimje^ 

LONDON ■ FA*tt - MANKRJkT • NEW YORK -TOKYO 







26 



MARCH 1 1994 


COMPANY NEWS: UK 



Flotation could put minimum £450m price tag on stores group 

House of Fraser at £34.5m 


By Nefi Buddoy 

House of Fraser, the 56-store 
department store chain which 
is preparing for flotation, lifted 
pre-tax profits by 31 per cent 
from £23£m to £&5m in the 
year to January 29, the path- 
finder prospectus revealed yes- 
terday. 

The result was after excep- 
tional costs of £3.7m on prop- 
erty disposals and interest 
charges of £&8m. Total sales 
increased from £694m to£722m, 
and Ilke-for-iQre sales were up 
8.6 per cent 

Earnings per share were 
lQ.lp (42p). Before exceptionals 
they were ILlp, leading ana- 


lysts to expect that the com- 
pany could be valued at a mini- 
mum £45Qm. The offer price 
will be announced on March 

17. 

Mr Brian McGowan, the for- 
mer chief executive of Wil- 
liams Holdings who was 
tempted from retirement last 
year to became House af Fras- 
er's chairman, said the 
Improvement had convinced 
him of the chain’s potential. 

‘‘Most of my critical precon- 
ceptions proved to be wrong 
and in-judged," he said. 

He said the group, which 
trades under 17 different 
names inniitdiwg Dickins & 
Jones, Army & Navy, Rack- 


hams, H iring planned a 
£50m refurbishment pro- 
gramme. It was revamping its 
product range, grouping its 
stores into three categories 
depending on size. 

It also planned to match the 
merchandise in each store 
more closely with local cus- 
tomer profDes- 
The Egyptian ‘ Fayed 
brothers, who bought the 
group for almost £600m in 1986, 
are selling the entire fhain 
with the exception of its for- 
mer flagship, HarrodS- 
Of the 229.6m shares, a quar- 
ter are being offered to the 
public, subject to clawback by 
institutions. 


Analysts believe House of 
Fraser Is looking at an offer 
price of between l&)p and 220p 
per share, valuing the com- 
pany at between £4l0m and 
£50Qm, depending on market 
movements, and the effective- 
ness of the group’s ma rketing 
campaign. 

On the stores sector historic 
multiple of about 19, the price 
would be 21 lp, valuing the 
company at £484n, but many 
analysts expect the price to 
be slightly lower, at about 
200* 

Mr McGowan said net debt 
at the end of January was 
£93m, putting gearing at 37.5 
per cent 


Guardian Royal 
changes name 

By Richard Lapper 

Guardian Royal Exchange, the 
fifth largest of the UK compos- 
ite insurers, is dropping Royal 
Exchange from its title and 
wfli be known to fixture simply 
as Guardian. 

The group is also replacing 
its company logo with the 
image of an owl, to create a 
"new visual identity ... part of 
the group's strategy to build a 
more powerful corporate 
brand worldwide,” according 
to a statement yesterday. 

The name will be Introduced 
progressively in 1994 but the 
legal names of Guardian Royal 
Exchange and its trading sub- 
sidiaries in more than SO coun- 
tries are not affected. 

“A new name and identifier 
have been adopted for use 
internationally. This is partic- 
ularly important now as we 
establish new companies and 
reposition existing ones,” 
explained Mr Sid Hopkins, 
chief e x ecutive. 


SWP expansion 

SWP Group, the CSM-quoted 
maker of specialist compo- 
nents for the construction 
Industry, more than doubled 
pre-tax profits in the half year 
to December 31, from £42,000 
to £105,000. 

Turnover improved from 
£3-71m to £4.43m gener a ting 
operating profits of £167,000 
(£126,000). Earnings worked 
through at 0.3p (O.lp). 


Brent Walker loan moves proceed 


By Haggle Un-y 
and Peggy HoBtnger 

Lenders to William Hill, the 
betting shop business owned 
by Brent Walker, should be 
repaid today, the date their 
£325m loan- is due. 

The repayment follows the 
refinancing of the loan by 
banks to Brent Walter, with 
Standard Chartered and Lloyds 
Hank pg rii landing significant 

amounts, without the refinanc- 
ing, Brent Walker would have 
had to sell or float H2L Bank- 
ers now admit that if H31 had 
been sold Brent Walker would 
almost certainly have gone 
into receivership. 


Changes to Brent Walker’s 
£827m term loan agreement 
have been accepted by lenders. 
Last Friday holders of the 
group's variable rate notes 
agreed to chang es in their con- 
ditions, including the payment 
of interest in preference shares 
for a longer period. 

Of the £83m of notes out- 
standing, votes were received 
from £74m, with 99596 per cent 
voting in favour. The notes 
were created at the time of 
Brent Walker’s refinancing In 
March 1992, when they were 
exchanged for £10L9m of con- 
vertible bonds issued in 
autumn 1990. 

Many of the bonds were held 


by Brent Walker banks, but 
some had or igina lly been 
bought by investors found by 
Mr George Walker, who was 

rfortTman »nd chief executive 

of Brent Walker at the time the 
bonds were issued. There were 
no positive abstentions from 
note holders, as there have 
been previously, but it is 
understood that Lonrho and 

Tunis TT 7fpma<- j nn«1 Bank WGTO 

awfmg those voting. 

Bankers said that last week 
there were fears that the Wil- 
liam Hut lenders mi g ht have to 
be asked for a few days grace 
before the loan was repaid, but 
hitches had bean sorted out in 

Hmg- 


Cantab loss doubles to £2.9i 


By Tim Burt 

Cantab Pharmaceuticals, the 
bio-technology company 
quoted both in London and on 
Nasdaq in the US, blamed 
increased research spending 
for a doubling of losses. 

The Camhridgebased group 
said pre-tax losses rose to 
£2.88m (£1.4m) in the 12 
months to December 3L 

Analysts had been expecting 
losses of up to £3.6m as Cantab 
broadened its product portfo- 
lio, and Mr Nicholas Hart, 
finance director, said the 
increased deficit was "well 
within budget". 

Further spending on new 


drugs to treat ailments as 
wide-ranging as cervical cancer 
and genital warts will be 
financed from cash reserves of 
£20-6m (£ 655m), he added. 

Those reserves were boosted 
last year by a £13£m flotation 
in Lento and a private plac- 
ing in the US, winch together 
raised £l&9m after repayment 
of finance lease obligations. 

Although Cantab hopes to 
bring some of its new drugs to 
market on its own, it admitted- 
that it would have to farm col- 
laborations with international 
phamum y ntigii groups to pro- 
ceed with most projects. 

Of those drugs, only LM- 
CD45 - developed in collabora- 


tion with Baxter Healthcare, 
the US corporation - is dose to 
nuwkafa>K| a production. 

Hartor jias exclusive manu- 
facturing and marketing rights 
for the drug, designed to 
reduce rejection in kidney 
transplant operations. 

Mr Hart said licence fees and 
co nt ract development revenue 
from. Baxter formed the bulk of 
Cantab's turnover, which fell 
40 per cent to Cl flam (£L7m). 

Mr Hart warned that losses 
would increase in 1994 as BAD 
spending rose further and it 
began construction of a pilot- 
scale manyffa rti rriTig facility in 
Cambridge. Losses per share 
rose to 42pK26p). - - 


Carlton 
warned on 
Meridian 
holding 

By Raymond Snoddy 

Mr MWtapi R wwi, chairman 
of Carlton Communications, 
has warned Lord Holllck of 
HAI, the broadcasting and 
fi n an c i al services group, that 
be will sell his 20 per cent 
state In Meridian Broadcast- 
ing unless minority sharehold- 
ers get a better deal. 

Mr Green, It is believed, met 
Lord Holllck, the MAI chief 
exec u t iv e, last week to discuss 
the issue following MAPs 
acquisition of Anglia 
Trieviska. 

Carlton acquired its state in 
Meridian, the ITV company for 
the south of England, through 
its acquisition of Central Inde- 
pendent Television. 

Mr Green is believed to be 
concerned about the level of 
information received by share- 
holders such as Carbon and 
SelecTV, the independent pro- 
gramme maker which holds a 
15 per cent stake in Meridian. 

Both companies, it is under- 
stood, found out about MATS 
participation in a consortium 
to bid for a possible Channel 5 
Berne when they were sent a 
press release. 

Both Carlton and SelecTV 
aim fear that Ang lia , acquired 
by tiie main MAI company, 
could become a subsidiary of 
MAI Broadcasting, itself a sub- 
sidiary of MAI, thereby 
bypass in g M e r idi an . 

The minority shareholders 
are worried that any savings 
flowing from the acquisition 
wQl not go to Meridian, mat 
said it would not comment on 
" anonymous gossip." 

Mr Alan McKeown, chief 
exe c utive of SelecTV, produc- 
ers of programmes such as 
Birds of a Feather, believes the 
company has not received fan 
credit for its role in helping 
Meri dian win its franchise. 

Meanwhile Cariton is likely 
to buy out the two 5 per cent 
minority shareholdings in 
Carlton Television The Tele- 
graph group publishers of the 
Daily Telegraph and RGS, the 
Italian media group. Both 
would have to put up an addi- 
tional £40m each to avoid dilu- 
tion of their stake in the 
enlarged television bu siness. 
something that is considered 
unlikely . 


Airtours to sue former 
owners of Aspro Travel 


By MchMl Staptater, Latere 
Ind uaMaa C m re spon d e nt 

Airtours, the holiday, group, yesterday 
announced it is taking legal action again st the 
former owners of Aspro Trawl, which it bought 
last June for £20. 1m . . _ 

A irtours affqp M it was the victim of fraudu- 
lent representation at the time it acquired Car- 
diff-based Aspro and fitter European Airways, 
its wholly-owned subsidiary. 

Airtours said Initial investigations carried out 
by fcwkpmAmt estimate the value 

of its claim to be £9 Am. The action is against Mr 

George .Asprou, Mr Christopher Asprou an d Mr 
Dintttrioe Asprou. former owners of 90 per cent 
of Aspro TraveL 

Airtours it is also tg ^ in pr action a gains t 
ail Aspro's formor shareholders over warranties 
and representations contained in the purchase 
agreement. 

The Asprou family members involved said 
yesterday they would fight Airtours* action. 


They said: “The proceedings starte d by A ir- 
toure. unexpectedly and without any warning, 
are going to be strenuously and vigorously 
resisted. Prior to the takeover, the companyjiad 
a successful record of growth and exapfoymesfl." 

At toe time of toe Aspro acquisition last year, 
Airtours said the purchase would strengthen its 
markets In Wales, Northern Ireland and the 
south-west of England. It said Aspro a pro- 
grammes to the eastern Mediterranea n would 
complement Airtorars’ holidays to toe western 
Mediterranean and the Canary I slands . 

Airtours said yesterday that. Aspro aud its 
airline had now been fully integrated into its 
operations. Aspro’s bookings ware well ahead of 
■ the previous year and there had been a signifi- 
cant reduction in its cost base. 

Airtours said its accounts for the year to 
September 30 1993 reflected toe shortfall in prof- 
its against the level previously expected from 
the Aspro acquisition. It added: “There will 
therefore be no adverse effect upon the garnhigw 
or ****** of toe current financial year." 


Invesco increases assets in UK 


By Nonna Cohen, 

Investments Corre sp onde n t 

Invesco has purchased toe UK 
Index-matching fend manage- 
ment business of toe US based 
Bankas Trust which manages 
£L2fan in assets. 

The move will Increase 
Inveaco’s assets under manage- 
ment in the mt- 

Thfi company has been los- 
ing institutional pension fund 
clients In recent years 
reflecting mediocre perfor- 
mance and adverse publicity 
about its role In handling pen- 


sion scheme assets for the late 
Mr Robert MaxweJL 

Invesco, which has made 
numerous senior management 

changes over the past year, has 
said it wants to concentrate on 
bonding up its fond manage- 
ment capacity in Europe. 

Mr Norman. Riddell, chief 
executiv e of Invesco’s Euro- 
pean operations, said “This 
acquisition gives us access to 
market a product an the Conti- 
nent" While he does not see 
rf grdBcgnt interest in passive 
management in the UK, 'Conti- 
nental pe nsion finals are much 


more likely to be interested 
because it is a lower cost, low- 
ride way of gaining access to 
toe UK stock market 

Invesco is paying up to 
£600,000, with up to £900,000 in 
further payments depending 
on assets under management 
A number of clients axe US 
pension funds who must agree 
to thdr fund manager having a 
change of ownership. 

BT has specialised in 
so-called passive management 
techniques in which funds are 
invested to mimic toe perfor- 
mance Qf a& indpy - - 


Goldsboroogfa 
issue result 

By MaggtoUny 

Applications for shares in 
Gbldsborough Healthcare, the 
nursing home, hospitals and 
hamecare group, through the 
public offer were alloted in full 
after the Issue was marginally 
undersubscribed. Of the iXRm 
shares available to the public 
there was demand for 12.6m 
shares: Of these 3mn shares 
were applied for in the prefer- 
ential offe r 

Shareholders of iCimirk, the 
leisure group which sold its SO 
per cent stake in Gddsborough 
in the flrarf, were ahi» to apply 
for preferential shares. ■ 


DIVIDENDS ANNOUNCED 



Currant 

payment 

Date of 
payment 

Gams - 
pandng 
dMdend 

TOW 

for 

yoar 

Total 

tel 

yaar 

BBmp) — — An 

3.1 

Mays 

an. . 

52 

•5 

Brafrm (TFUtq fin 

&5 

Apr 27 

. &5 

075 

■075 

QmknFba fin 

as 

- 

- 

- 

- 

Capte Qmm Ai 

1.7 

May 17 

1.4* 

2£5 

‘ 2.1 

Compute Poopin — fin 

1.5 

My 1 

nil 

1^ 

ass 

Corporate SarvoS — fti 

025 

May 27 

nil ’ 

' n-w* 

rtf : 

Dfcton MoloraS ■■ ■ .to 

1^ 

May 9 

- 

225 


HUknmTiwt — M 

H . 

Apr 14' 

12 

» 

4.875 

Fklatty Euro fin 

nil 

- 

03 

03 

.08 

Oart Scotland 

2^4ff. 

May 27 

2.4. _ 


.'.10.. 

K38C fin 

164 

Mm 10 

142 

205 

19 

ICS kit 

1^ 

MayS 

123 . 

- 

4.4 

Ktaki Dov Fund Int 

2,75 

May 13 

2.75 

• - 

105 

■■■■»— — *■ 

Z85 

May 27 

225 

4.55. . 

425 

London ForWl§. Ibi 

6.1 

Apr 19 

52 - 

03 

04 

Poguw S ■ Iki 

3 

July 8 

2 • 

5 

9f 


1.9 

July 1 

1.7 

ai 

20 

Wondrhootekw fin 

0034 

May 20 

2.69 

5.17 

4J5 


DMdanda shown pence per share net except where otherwise stated. tOn 
Increased capftaL §USM stock. 4- Adjusted for scrip bsufcVFor t7 months. 
fMah currency. fTWrd interim, making 3p (3.6p) so for. ftSecond Interim, 
makfng.4np.ao fir.' _ 


HSBC Holdings pic 

Results for 1993 



For the year 

1993 

1992 

Profit before tax 

£2, 584m 

£l,714m 

Profit attributable 
to stureholders 

£l,806m 

£1^21m 

Eamvigs per share 

71.78p 

62.07p 

Dividends per share 

23.50p 

I9.00p 

Shareholders’ funds 

£9, 334m 

£8,01 lm 

Capital resources 

£1 6,087m 

£1 3,465m 

Assets 

£206, 050m 

£185, 141m 


££ Overall, business conditions were favourable for 
the HSBC Group in a year marked by growth and 
change, including the move of our holding 
company to London. The hard work and 
dedi c a t io n of our staff throughout the world was 
a vital dement of our success. 

Steady pr ogres s has been made in the integration 
of Midland Bank into the Group. While much 
remains to be achieved, the benefits realised so 
far have exceeded our e xp e ct a tions, particularly 
in the treasury, investment and UK c omm ercial 


Pre-tax profit up 51% and attributable profit 
up 48% 

Pre-tax profit up 47% and attributable profit 
up 44% in Hong Kong dollars 
Recommended final dividend of 16. S pence 
per share 

Scrip dividend alternative providing an 
enhancement of 50% 

Earnings per share up 16% 

Total capital ratio 13.2% and tier 1 ratio 7.9% 


As we took ahead, ure expect our business to 
benefit from continued growth in Asian 
economies and recovery in the UK and US. 
However, with interest rates at or near the bottom 
of the cycle, it ts unhk/dy that conditions in the 
treasury and capital markets in 1994 will be as 
favourable as those in 1993. 

With our broad geogra p hical presence and our 
expertise in trade finance, the HSBC Group is weB 
positioned to benefit from the growth in world trade 
which should result from the GATT and NAFTA 
agreements. We look forward with confidence to 
these new challenges and the o ppor t uni ties they 

present 99 



^7 

, Sir 'William Purrea, Croup Chairman 


7V jn/iinrutiarr m (Us .Dowuttcntttttr does not ant&tvie tiatutarjactotaas uTtihin ibe mooting of uetxm 24C of th* Corxpemcs Aa 1935- TTw shzocarj accounts for dm yew 

mteilDuxutolWl.ubukfam*iHmmqwhfkdmdmi‘iiwnanddam*ajmmaeauMeatuiderMrtiHm237a}ar{3iofibetta.uabediGwiw4iod*IUsiam-af 


Companies m fyrglmd and Wata at Azadflcr j abb seaxn 2*2 of At Aa. 


Copin nfAefidraataim 


end Acecaaos uiB be tent to ibarwMden at mriy Apri 


may be obtmud from Group After*. 10 Lower Tbcma Stout, London EC3R 6A£. United Kingdom. Tin 1993 ArtauaJ Repen 


Incorporated a E»gbwd untb bdud liability 
Rtgut rrt d m England r number 617987 

Resumed Often and Croup Head Office; 10 Lower Thames Street. London EC3K.6AE, United Kingdom 




£300,000,000 

Floating Rate Notea 
Due 1996 

(Second Sena) 
Notice U hereby given 
that the note* will bear 
interest at 5 .23625% per 
annum from 28th February, 
1994 to 3I*t March, 1994. 
Interest payable cm 31st 
March, 1994 will amount 
xo £2224 per £5 jOOO note 
to £222.36 per £50,000 
note. 

Nationwide Building Society 
Affza Bank 

Baring Bwdim &Ca. tinted 


Martin-jBierbaum 
(Italia) S.p Jl - S.I.M. 

20122 Milano - Ptazza Ercuiea, 9 

From 1st March 1994 
will change its name to 

JlE 

I JTBura SERVICES 
SXM. S.P.A. 


Routes Dealing Code: JTBX 
Bn*g Master : JTB1/2/3/4 

TeL 39-2-722051 
Far 30-2-8056987 


SOCETE GENERALE 

USD 210.000.000 

SUBORDINATED 

FLOATING RATE 

NOTES DUE 2002 
For the period 
February 28, 1994 
to August 30, 1994 
the new rate has been 
fixed at 5,125% PA. 

Next payment date : 

August 30. 1994 
Coupon nr: 4 

Amount; 

USD 130,26 for the 

denomination of USD 5 000 
USD 2605,21 for the 
denomination of USD 100 000 

THE PRINCIPAL PAYING 

AGENT SOGENAL 
SOCJETE GENERALE GROUP 

TSk AdtRater-UJKafiOURG 


a 



HOUSE OF FRASER 

Share Offer 

ARMY a NAVY- ARNOTTS BARKERS - BINNS - CAVENDISH HOUSE - OAVtO EVANS 
- O H EVANS • DICKINS & JONE5 • DINGLES • FRASERS ■ HAMMONDS 
HOUSE OF FRASER • HOWELLS - JOLLYS • KENDALS ■ RACKHAM5 • SCHOFIELDS 

SHARE REGISTRATION 
AND 

INFORMATION LINE 

To reserve a prospectus and 
application form or for further information, 
please call the following freephone number. 

0800 800 400 


tabl aLuEd «»**- Any ««* offer or imritation w* be madein 
a pnnpecon to course and ** WCh ecqukWon lh<>oW ^ 

on the bus of information contained In.sxh prospectui . 


i | 


FGF (BEBTODA) LTD 
USUfi/NXMMO 

FUMISto MTB NOTES MB IMS 

Notice N bento Cfeea ihac for die 
afti from 1 March 1S94 col 
ISM tftt notes wSlcaoy 
i of 420K persona. 

JJFOkmcml 

Aa Ago* Beak 


( BRADFORD & ^ 

SINGLE? 

BUILDING SOCIETY 
£150,000,000 
Floating Rate Notes 
Due 1994 

In accordance Witf] the t eiro sxi 
c o o rfftiorw of the Kofea. notice b 
hereb y glwa that far (he three 
wmh otaot period from (and 
b sfad a n) 28U] February 1994 to 
(botmfnitint)3Ut May 1994, the 
Note wittorry a meet imam of 
3.25 per ceoL per a n nu m . Tbs 
trie rant iuentr payment dace 
wffl be 31st May 1994. The coopoo 
aaoofll perHUBO wffi be £13233 
payable again moder of 
Coopoa No: 20. 

Ham bros Bask Limited 

i Agent Beak j 





Tto nraqr MU npoit on Ito 



tfwlK. 

For non totamtlm 


onon ndftotM enfant an dataUa of vtvanilfeX 
to ttta aurvay, pfeaH oootnet; -w— » 

ANIHONYR haves ■ : 

Tab 021 454 QB22 foe 021 455 0868 ^ 

FT Surveys . j 


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^ *-■ 



FINANCIAL TIMES T UESDAY MARCH 1 1994 


27 


COMPANY NEWS: UK 


Capita advances 24% 
and sees further growth 


By Andrew Bulger 

Capita Group increased pre-tax 
profits by 24 per cent to £5.46m 
in tbe year to December 31. 
Turnover increased by 52 per 

cent to 250.2m, of which £2.14m 
came from acquisiti ons, 

Ur Rod Aldridge, chairman, 
said Capita had strengthened 
further its position as a leading 
provider of professional sup- 
port services to the public and 
private sectors. 

He said: “Our current order 
book in all three divisions is 
stronger than 12 mon ths ago 
and we are continuing to bid 
for many business opportuni- 
ties . . . I am optimistic that 
Capita will make farther prog- 
ress." 

Net cashflow from operating 
activities rose from £7.9m to 
£8 -5m, of which £4.4m was 
invested in acquisitions and 
23.5m in capital expenditure. 
The group's, net cash balance 
dipped from £9.6m to dm 
Capita said its restructuring 
into three divisions had been 
successfully completed. Out- 
sourcing increased operating 


profits by 32 per cent to 
£2-55m, the advisory division 
was up 2i per cent at gissm 
and property services rose by 
15 per cent to £L64m. 

The outsourcing division’s 
forward projected revenues up 
to the end of 1998 stood at 
fll&n, a 55 per cent increase 
over the corresponding period. 

Mr Aldridge said the group 
had started 14 new local gov- 
ernment outsourcing contracts 
during the year. “We have won 
two significant contracts at tbe 
London boroughs of Westmin- 
ster and Bexley worth £l4£m 
in aggregate, which start in 
April 1994. These contracts are 
to provide collection services 
for council tax and business 
rates. As a result. Capita is 
now responsible for the animal 
collection of £l2bn of puhlic 
money. We anticipate further 
contract wins by the half 


The group said prospects 
were excellent for its advisory 
division, which ftatf established 
a firm niche in well-paid work 
far central government. 

Earnings per share in craagad 


by 23 per emit to 7.9p (6-4p). A 
final dividend of 1.7p gives a 
total of 2£5p (2.1p), a rise of 21 
per cent 

• COMMENT 

Capita has built an admired 
position in providing con- 
tracted services to local gov- 
ernment by w gyynfFating on 
high-margin activities such as 
revenue collection and- com- 
puter services, rather than 
fiercely competitive cleaning 
and catering contracts. The 
group, estimates more than 800 
of its type of contract will 
come , up over the next five 
years, so there remains plenty 
to go for. Market testing is pro- 
ceeding more slowly in central 
government, so Capita's best 
chance there looks to be an tbe 
consultancy side. Forecast pre- 
tax profits of £8.7m put the 
shares, up Sp to 220 p, on a pro- 
spective multiple of 24- They 
cannot be classed a bargain at 
thisIeveL but the premium rat- 
ing looks justified both by the 
group’s track record and pros- 
pects. 


Reorganisation costs leave 
Woodchester halved at I£17m 


By 71m Coone in Dublin 

Woodchester Investments, the 
Dublin-based leasing and bank- 
ing group, has reported a halv- 
ing of 1993 pre-tax profits from 
l£35.4m to I£17.1m (£l6.4m), 
after an exceptional charge of 
l£iom to fond restructuring. 

Excluding the exceptional 
charge pretax profits showed a 
9 per cent drop. 

The charge is ‘'deemed fully 
adequate and of a once-off 
nature" and once complete, the 
restructuring plan “will lead to 
a gt gwifframt improvement in 
the long-term profitability of 
the group”. 

Woodchester, in which 
Credit Lyonnais has a 4737 per 
cent holding, has grown rap- 
idly in Ireland in recent years, 
through acquisitions, and 
despite rationalisations the 
company says there remained 
“an unacceptably high cost 
base" and a' number of 
“unprofitable product lines". 

Its core car financing busi- 
ness grew by 16 pm- cent in the 


period. In the UK the group 
reported a doubling of its 
motor finance business to 
£173m, but decided to discon- 
tinue two non-core activities, a 
c ommerc i al mortgage company 
and a trade finance subsidiary. 

Reorganisation is also taking 
place in <71.^ ffrp leasing sub- 
sidiary of Credit Lyonnais, in 
which Woodchester has a 30 
per cent stake. Middle-ticket 
and small-ticket leasing is to 
be split into two divisions, the 
middle ticket section being 
managed through Credit Lyon- 
nais hank network, while the 

gmall-tirfret Togging and busi- 
ness equipment and vehicle 
finanro is to he managed sepa- 
rately. Woodchester is to take 
direct responsibility for the 
small-ticket leasing business in 
Denmark and Portugal- 

Total assets improved over 
the year from l£L4hn to l£1.5hn 
with a Her one capital ade- 
quacy ratio of 20 per cent. The- 
drop in. interest rates* made 
this surplus capital earnings 
dilutive, the company said, and 


the board regarded its prudent 
in ves t ment as a key priority. 

Earnings per share were 
82Sp (I5jp). A Aral dividend 
of 3.09p is proposed for a total 
of 5.I7P (45p>. 

• COMMENT 

Woodchester's rapid expansion 
and diversification into bank- 
ing through its strategic affi- 
ance with Credit Lyonnais, has 
not gone as smoothly as expec- 
ted. The company's strong bal- 
ance sheet however, together 
with, its rignfcann to dean out 
B B M flW ite Knag of business 
and tackle its cost base, would 
seem to justify the increase in 
dividend as a nuamn of main- 
taining shareholder loyalty, 
albeit that Credit Lyonnais will 
he the main beneficiary. Pre- 
tax profits of ££32m in 1994 
would seem to he attainable, 
giving earnings of lL9p. A pro- 
spective p/e ratio of 103 is 
higher than -Ireland’s two main 
clearing banks, suggesting that 
any upturn is already priced in 
to the company’s shares. 


Success in 
UK help 
Sema rise 
to £24.9m 


By Alan Cano 

Sema Group, the Anglo-French 
Information systems company, 
yesterday announced a 28 per 
cent increase in pre-tax profit 
from £193m to 5243m for the 
year ended December 31 1993. 

Tnrover increased by 20 per 
cent to £5Q2m (£417m), while 
earnings per share rose 26 per 
cent to lR6p (13.2pX Tbe divi- 
dend is raised 10 per cent to 
3.1P. The share price moved up 
9p to 373p. 

The company has net cash of 
£18JSnt, compared with £&5zn. 

The results include the effect 
of last year’s £20m acquisition 
of the Swedish company 
SKDforetagen. 

Sana is a broad-based com- 
puter services company spe- 
cialising in systems integra- 
tion. 

The company is active prin- 
cipally in France where reve- 
nues grew 11.4 per cent to 
£1703 and in the UK where 
growth of 23.2 per cent to 
£212. lm was recorded. It was 
the company's most successful 
year in the UK since GAP and 
Sema Metre merged in 1988. 
Mr Pierre Bonelli, Sana chair- 
man, said it was the result of 
strong growth in outsourcing - 
running customers’ date pro- 
cessing on their 

• COMMENT 

Sana has yet to come close to 
fulfilling its 1989 strategic aim 
of of a 6025:15 revenue split 
between systems integration, 
facilities management and 
products. Nevertheless, its 
strength in its key applica- 
tions areas of energy, repre- 
senting 573 pa cent of sales, 
transport (43.1 pa cent) and 
defence (28.4 pa cent) more 
than make up for its problems 
with I-Linie, the industrial 
management package It is 
developing with IBM. It is 
however spending a dispropor- 
tionate a mou n t - perhaps as 
much as half - of its £l4,6m 
research and development rev- 
enues on the package busi- 
ness. Given the group's sound 
fundamentals and forward 
order book, a successful pack- 
ages business would ice an 
already rich cake. Analysts 
are making in p retax p r o fi ts 
of £33m fa 1994 giving 20J2p 
of earnings. On a histor i c p ri ce 
earnings ratio of 22.5, the 
shares lode very reasonable. 


Share issue for NM Smaller Australian 


By Bothan Hutton 

NM Smaller Australian Companies 
investment trust is planning a conversion 
share issue to Increase its size. 

The fund was launched last December, 
less than three months ago, raising £25An 
with its initial placing. By the end of Janu- 
ary, the teusfs assets had grown by about 


21 pa cent to approximately £29m, and it 
is now capitalised at just ova £30m. 
Shares in the trust have traded at a pre- 
mium for most of its life. 

Full details of the C share issue are not 
yet available, but it is likely to take tire 
form of a placing and open offer to exist- 
ing share and warrant holders, rather than 
a public offer. The placing stage is expec- 


ted to be completed by Easter, and tbe 
open offer to dose by the end of April 
NM Funds Management is a subsidiary 
of the National Mutual Lift* Association of 
Australasia, Australia’s second largest life 
office. NM says the timing of the C share 
issue is due to shareholder demand, and 
favourable economic conditions fa invest- 
ment in Australia. 


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Shares fall 7p as weaker current trading conditions are reported 

London Forfaiting advances 19% 


By Andrew Jack 

London Forfaiting Company, 
the specialist trade finance 
house, yesterday reported prof- 
its up 19 pa cent to £2L5m in 
the year to December 31 1993. 

The shares dropped 7p an the 
day to close at 226p following a 
wanting of poorer trading con- 
ditions so far this year com- 
pared with the same period 
last year. 

Mr la rfr Wilson, chief execu- 
tive, said trading for the first 
few weeks of ism had been 
“less favourable” than in 1993 
but that it was too early to 
mafeg “useful comments about 
the year as a whole." He 
refused to say bow significant 
the difference was. 

“We are very pleased with 
the results,’' said Mr Wilson. A 
final dividend of (Lip (5ip) is 
recommended, making a total 
for the yea up 10.7 pa cent to 
9.3p (&4p). Earnings pa share 
advanced to lSJSp (13.75p). 

Tax rose to £5.3m (£4. 3m), 


representing 25 per cent of pre- 
tax profits (24 pa cent). 

The company said that Mr 
Ooi Boon Aun. managing direc- 
tor of LFC Far East, who is 
based in Hong Kong, had 
joined the main hoard. It said 
it had also established London 
forfeiting International a UK 
subsidiary, during tbe yea to 
act as holding company for its 
overseas subsidiaries. 

It also said that it had 
strengthened its trading team 
and administrative systems, 
and created a central coordi- 
nation department to boost 
internal audit and compliance 
work. “We are in the process of 
going from being a large small 
company to a small large com- 
pany” said Ur Wilson. 

l mmu mnr o than tre- 
bled from £21 .fen to £71. Im dur- 
ing the year, while hank inter- 
est payable jumped from 
£932.000 to £2.S9m. Interest 
receivable and Income from 
certificates of deposit dropped 
from £3.45m to £I.96m. 


• COMMENT 

Analysts ascribed yesterday's 
fell in the share price to the 
warning that its results for 
January and early February 
this yea were Iowa than 1993. 
The company said this primar- 
ily reflected a timing difference 
with a bunching of completed 
deals which had not been 
repeated in 1994. as well as 
fluctuations in the Eurobond 
market LFC's shares are at a 
discount parti; reflecting the 


general malaise of the financial 
services sector and also the 
lack of understanding of for- 
feiting. In addition, there is the 
intriguing low tax charge, and 
tbe company’s policy of rela- 
tively little disclosure, such 
as its refusal to report 
turnover, profits and net assets 
segmental]}-. There is no indi- 
cation that this is likely to 
change in the annual report 
which is due out later this 
month. 


Braime slips to £0.54m 


Higher interest charges and 
lower income from invest- 
ments led to pre-tax profits at 
TF&JH Braime (Holdings), the 
finished metal products, forg- 
ing, pressing and stamping 
group, slipping from £582,606 to 
£544,412 in the yea to Decem- 
ber 31. 

Turnover, however, was up 
at £6. 85m (£6.51m). Trading 


profits were £2,000 down at 
£483,877, while investment 
income declined to £111,640 
(£125,314). Interest took 250,105 
(£27,582). 

Unchanged final dividends of 
fe5p are proposed for both tbe 
ordinary and A ordinary 
shares for same-agaln 8.75p 
totals. Earnings per share 
emerged at 23.29p (2S.69p). 


r 




Alt of tf»M sec uri t ies haring bean som this announcement appears as a matter of recortf only. 


rP RHONE-POULENC 


Indosuez Capital 


On behalf of the Republic of France 

Global Coordinators 


Societe Generate 


:/ 


Pt*fc Qftertng of $£330,883 Ordinary Shares “A” in Ranee 
rf > Vfcpp Offering Meet FRF 135 per Ordinary Share “AT 


r. 


Societe Generate 

Lead Manager 


Banque Nationals de Paris 

Banque Federative du Ctedrt Mutual 
Credit Industrie) at Commercial 
Banque Paribas 
Lazard Frores et Cie 


Credit Lyonnais 

Joint Lead Manager 

Crddit Agricole/Rothschild & Cie. Banque 


Banque du Louvre 

Cle.Flnanctere Edmond de Rothschild Banque 
Banque Pallas Stem 
Banque Hervet 



Ordinary Shares 
mF%*6 tier Ordinary Share *A» 


Indosuez Capital 

Global Lead Manager 


French Seffing Group Members 


Indosuez Capital 

Lazard Fteres et Cie 

Credit Agricole/Rothschild & Cie. Banque 

Banque National© de Paris 


Societe Generate 

Global Joint Lead Manager 


Societe Generate 

Caisse des Depots et Consignations 
Credit Lyonnais 
Banque Paribas 


Credit Commercial de France 


Caisse Centrale des Banques Populates 
C.P.R. 

Banque du Pttenix 
Banque du Louvre 
Cr6drt National 


Banque de Neuflze, Schlumberger, Mallet 
Banque Pallas Stem 

Banque Worms 
Banque Rivaud et Cie 
Union de Garantie et de Placement 


Indosuez Capital 

Credit Commercial de France 
Morgan Stanley SA 


ABN Amro Bank N.V. 

Baring Brothers & Co, Limited 
Deutsche Bank France S.N.C. 
Banque Paribas 

Caisse des Ddpdts et Consignations 

Dresdner Bank 

Akttongasefecfisft 

Robert Fleming & Co„ Limited 
Klein wort Benson Limited 
JP Morgan & Cie SA 


Morgan Stanley & Co. 

JncajDO/aiBtf 

Bear, Steams & Co. Inc. 
Goldman. Sachs & Co. 
Smith Barney Shearson Inc. 

Lazard Fteres & Co. 

J.P. Morgan Securities Inc. 
Paribas Capital Markets 
S.G. Warburg & Co. Inc. 


The Nomura Securities Co., Ltd 

WJ. Carr (Overseas) Ltd. 

The NEkko Securities Co* Ltd. 

Adviser to the Republic of France 

Indosuez Capital 

December. 1993 


Inter na tio n a/ SeOng Group Members 

Societe Generate 

Credit Lyonnais 

CS First Boston 

NM Rothschild and Smith New Court/Credit Agricole 
Banque S.G. Warburg 

Banque Nationale de Paris 
James Cepel & Co. 
Lehman Brothers 
UBS France SA 

Cazenove & Co. 
Enskilda Corporate 

Skandfnavlska Enskilda Banken 

/strtuto MobiNare italiano S.pA 
Midland Walwyn 
Soctete de Banque Suisse (France) SA. 

ULS. Seffing Grocp Members 

Donaldson, Lufkin & Jenrette 

Securities Corporation 

Credit Lyonnais Securities (USA) Inc. 

Lehman Brothers 
Societe Generate Securities Corporation 
Merrill Lynch & Co. 
Paine Webber Incorporated 
Prudential Securities Incorporated 
Wasserstein Perella Securities, Inc. 

Japanese Setting Group Members 

Dalwa Securities Co. Ltd. 

Soctete G6n£rale Securities (North Pactffe) Ltd., Tokyo Branch 
Yamalchi Securities Company, Limited 


Adviser to the Company 

Societe Generate 




Indosuez Capital 

Jornl Lead Manager 


Caisse des D6pdts et Consignations 


Credit Commercial de France 

Caisse Centrale des Banques Populaires 
Credit du Nord 

Compagnie Financier© Barclays, de Zoete, Wedd 
Union de Garantie et de Placement 


Banque du Ph&nix 
Banque Worms 
Banque Frangaise du Commerce Exterieur 
Banque Hottinguer 









28 


FINANCIAL TIMES TUESDAY MARCH .1. 1994 


nBSMKfTTOCNTMfUKASA rMlBOF HOP'D OM1 




PARK* PLACE 


Park Place Holdings Limited has acquired 100% of the shares 
of Com invest UK Limited 

from 

Cominvest International SA 

(port of die Cragnocd & Partner* CapttaJ Envestmenc Group) 

Cominvest UK Limited has changed its name to 
Park Place Capital Limited 


Park Place Capital Limited b an Inves t men t manager specnfeJng In global 
hedging and (Erectional investment strategies. 

Thq board and euKuehmof the company are 
Stanislas MAbasutavich - chairman 

Giuseppe Ciardi - managing director Pantd Album - Investme nt ma na ger 
Christopher Shepherd - investment director Philip G. hands - inve st ment m a nage r 
Peter G. Spencer - finance director Michele Ragazti - Investment ma na ge* 


i 


PARKlPLACE 

CAPI TAL LIMI rtU 


li S I |AM[ V* % rai IT LONDON SW1A II IA 
Itu PHONE W! 176JPU0 FAL3IMILI 071 *00041! 


MWUKOI IM 


'fliia artimiMYiKM u Iwiied in ccvni/li.wce villi i he rvquimncna of the Inienuuional Stack Exchange of die 
L'niirii Kingdom and dtc Republic oflreUud Limited (“the London Stock Exchange”). It doer not constitute on 
in vital iuu 10 the public la subscribe fur. ur purchase, any securities. Application baa been made to the london 
Slock Kscbangc fnr the whole uf the sluire capital of Ccdardau ptc (“the Company”) issued, and to be issued, to 
be admitted lu tile Official List. It is expected that dealings in the Ordinary Siutres of the Company will commence 
on 7 March, 1991, 




CEDAR DAT A pic 

(Incorporated and registered in England and Wales under the Companies Acts 1948 to 1981) 
(Registered No. 1 7 1 3499) 

PLACING 

by 

GR£IG MIDDLETON & CO. LIMITED 

of 

13.705,440 Ordinary Shares of 5p each at 105p per share 

SHARE CAPITAL 

bno/Wtefe 

Aalionsrd iaaet JUfy fail 

.Imount Xurnbn ofi/mm .haunt Xtmttr 

£2,250,000 15,0110,001) in Ordinary Sham uf5p £1331.485 30329,700 

'ilic new Ordinary .Shares to be Issued will rank in full for all dividends or other distributions to be declared, 
made ur paid on the Ordinaiy Shares of the Company and pari paxsm in all respects with the Ordinary 
Share* currcmlv in issue. 

Cedardata provides a range uf conimrirfal and linanciai management software known as r&ci (Commercial 
and financial Accounting Systems) for medium and large size organisations in both the public and private 
sectors. 

Listing Particulars relating tu the Company are available, during normal business hours on any weekday 
"(Saturdays excepted), from the Company Announce men is Office, lain don Stock Exchange Tower, Capet 
Court Entrance, off Bartholomew lane, lamdon EC2N I HP. by collection only, up lo and including ’2 Match, 
199-1, and during normal business hours (excluding Saturdays), up to and including 14 March. 1994 from: 

Greig Middleton & Co. Limited 
66 Wilson Street, 

London EC2A 2BL 


1 March, 1W4 


Oriel House, 52 Coombe Road, New 


Com pan; 
Malden, 


Surrey KT34QH 


This formal notice, which is published on 1st March, 1994, is issued in compliance with the 
reaiiircmonts of the International Stock Exchange of the United Kingdom and the Republic of 
Ireland Limited (“the London Stock Exchange"). It should be read in conjunction with the listing 
particulars dated 28th February, 1994 (“the Listing Particulars") relating to The Hoarc Govctt 
Smaller Companies Index Investment Trust PLC (“the Company*) which alone contains full details of 
the Company are I the “C" Shares. 


THE HOARE GOVETT SMALLER 
COMPANIES INDEX 
INVESTMENT TRUST PLC 


(fau. 


I is EngtanJ dul Wata t 


iw; h*. mm* 


OFFER FOR SUBSCRIPTION TO 
QUALIFYING SHAREHOLDERS 
OF UP TO 20,000,000 “C” SHARES OF 50p EACH 
AT 125p PER SHARE 
sponsored by 

Hoare Govctt Corporate Finance Limited 

AVAILABILITY OF LISTING PARTICULARS 
Copies of the lasting Particulars can be obtained during normal business hours up to and including 
14di March, 1994 from the following: 

Hoare Govctt Corporate Finance Limited Lloyds Bank Pic 

4 Broa ilgate Receiving Bank Services 

Isirekm EC2M 7LE Lloyds Bank Registrars 

PO Box 1000 
2nd Floor, Bolsa House 
80 Cbcapsidc 
London EC2V 6 EE 

in addition, copies of the Listing Particulars can be obtained, by collection only. Tor two business 
days from the date hereof from the Company Announcements Office, The London Stock Exchange, 
London Stock Exchange Tower, Capcl Court Entrance, off Bartholomew Lane, London EC2. 


COMPANY NOTICES 



bvanar 

EVVbi35dNAPOU 


Via A. De Gasperi, 71 - 80133 Napoli - Italy 
Share Capital 1TL 417,6 BN 


ISTITUTO PER LO SVILUPPO ECONOMICO 
DELLTIALIA MERIDIONALE S.PJL 

ISVEIMER 

amended and supplemented (the 
Amato Law) which provides, in- 
ter alia, that the majority or the 
shares of companies resulting 
from a transformation under the 
Amato law be held directly or 
indirectly by Italian public enti- 
ties. The new by-laws of lsvei- 
mcr actually reflect this condi- 
tion and, at present, the majority 
of the shares in Isvcimer is held 
by Banco di Napoli S.p.A^ 
which is in turn majority owned 


By a corporate procedure initial- 
ed on September 8, 1993 and 
concluded on December 6. 1994. 
1st itu to pur lo Sviluppo Ecuno- 
mico dcU'lialia Meridionaic 
changed its legal status from a 
public law credit institution of 
Italy into a limited liability com- 
pany (“Soricti per arionT or 
'Xpj.'l 

The transformation was carried 
out pursuant to the provisions of 
Italian law No. 218/90, as ' 


by Fbndazione Banco di Napoli, 
a public law institution con- 
trolled by the Italian Ministry of 
the Treasury. The transforma- 
tion did not involve any transfer 
of assets or liabilities or any no- 
vation and Isvcimer continues to 
be a credit institution regulated 
by the Bank of Italy, performing 
mostly its traditional medium 
and long term lending activity 
within the Banco di Napoli 
Group. 


COMPANY NEWS: UK 


Exceptional boosts 
Pegasus to £6.93m 


By Alan Cane 

Pegasus Gro up, supplier of 
accounting software for small 
and medium sized companies, 
showed sharply improved prof- 
itability last year after a 
change of manag ement, a sub- 
stantial disposal and the 
launch of a new flagship 
accounting system. 

The company, based in Ket- 
tering, Northamptonshire, 
reported 1993 pre-tax profits of 
26.93m, including exceptional 
profits from the disposal of Its 
business forms operations of 
26.15m. Profits for the previous 
17 months were £620,000, 
including exceptional credits of 
£337,000. 

Earnings per share were 


76.1p <7.7p) or excluding ercep- 
tmnals 7.8p (2Jp). A final divi- 
dend of 3p is proposed, lor a 
total of 5p, against 9p for the 
previous 17 months. 

Turnover was £7Am (£lQ-3m) 
Including £2. 61xn (£3.75m) from 
discontinued activities. 

Mr Jonathan Hubbard-Ford, 
appointed chief executive in a 
boardroom coup in' December 
1992, -said the company was set 
for recovery following a poor 
diversification and acquisition 
programme which had dam- 
aged both cash flow and prod- 
uct development. 

The company's business 
forms operations had. been sold 
in total to Deluxe Corporation 
for £8.75m in cash plus a far- 
ther estimated 2L25 dl. As a 


result year-end cash balances 
stood at £&28m. Net interest 
income contributed £229,000 
(£297,000) to the pre-tax figure. 

The company’s share of the 
•modular” accounting systems 
market was up 5' percentage 
paints to 32 per cent by value. 
Losses on software products 
were reduced to £319,000 
(£L04m), due to the launch of 
die latest version of Pegasus* 
principal accounting package. 
Senior. 

The company's future; how- 
ever, depends to a large extent 
on its new flagship product, 
Pegasus Opera. 

It Is thought to have taken 10 
per rent of 9* modular market 
«drwe its in September 

last year. 


Computer People rises to £l.lm 


Computer People, the 
London-based computer 
recruitment service and con- 
sultancy, last year saw a 
return to growth in revenues 
and pre-tax profits as the 
recession eased in the US and 
UK, writes Alan Cane. 

Helped by strong control of 
overheads, pre-tax profits were 
greatly improved at El.lm 
(£145.000) with earnings per 
share at 4^7p against losses of 
Q.97p. 

Revenues were up 10 per 
cent to £68.75m (£62.74m) 

A single, final dividend of 
lAp net is being paid. 

Last year there was only an. 


Interim of 0A5p. 

Net borrowings are now 
down at £4.lm and the gearing 
has been reduced from 92 per 
cent to 75 per cent 
Computer People operates 
placement and consultancy 
services in the UK and consul- 
tancy services in the US. 

Turnover for the UK busi- 
ness grew 13 per cent to 
£44.4m, while in the US dollar 
revenues fell 12 per cent, bat 
operating profits rose 12 per 
cent to $899,000 as a result of 
improvement in margins and 
control of overheads. 

Mr Anthony Lambie, joint 
chief executive, said the 


Billam 
declines to 
£385,000 

Pre-tax profits at J B illam, the 
Sheffield-based specialist engir 
neer, fell 20 per cent from 
£479,000 to £385,000 in the 1993 
year. The company blamed the 
recession in the aerospace 
industry. 

Turnover advanced from 
£5.99m to £6.67m. Earnings per 
share were 16p (20. Ip) and the 
proposed final dividend is 
maintained at 3.1p for an 
increased total of 5-3p (5p) [or 
the year. 

Action was being taken at 
the Aircraft and Sheet Metal 
Engineers offshoot in view of 
the downturn in aerospace. 

Billam’s other subsidiaries 
achieved progress during the 
year. 

Hogg Robinsoa 

Hogg Robinson, the business 
services concern, has acquired 
Skfllbase, a specialist in corpo- 
rate downsizing, flexible 
resourcing and management 
and personal skills training, 
for £5.5m in cash. 

There will be an additional 
earnout up to a maximum of 
£2m related specifically to prof- 
its from corporate downsizing 
contracts over the next three 
years. 

FOr the year aided June 30 
1993 Skfilbase achieved pre-tax 
profits of £l-56m. 

H>V 

International Distillers & Vint- 
ners, the drinks sector of 
Grand Metropolitan, has estab- 
lished its own importing and 
distribution companies in 
Poland and the Czech Repub- 
lic. 

1DV Poland has been estab- 
lished in Warsaw to serve a 
vodka market almost as large 
as that of the OS, with annual 
sales of an estimated 35m cases 
a year. 

IDV Czech Republic has been 
established in Prague and will 
also serve neighbouring Slo- 
vakia. 

Vistec 

Vistec Group, the USM-quoted 
supplier of computer systems, 
has acquired Data Logic Com- 
munication Services, a com- 
puter network design, installa- 
tion and maintenance 
company, for £2J>m cash. 

DLCS incurred a pre-tax loss 
of £l.06m before exceptional 
costs of £970,000 on turnover of 
£&8m in the year to end-De- 
cember 1993. 

However, a substantial 
restructuring In the latter part 
of the year brought about a 
retain to profitability, and the 


US$900,000,000 

Floating Rate Subordinated Loan 
Participation Certificates due 2000 

Issued by Salomon Brothers Akticngcsdlsdiaft 
for the purpose of financing a subordinated loan to 

^^The Mitsubishi Bank, Limited 

Notice is hereby given dial for ihe three months interest period from 
28h February 1994 lo 31sl May 1994 the Certificates sriU cany x Coupon 
Kate of 4% per annum. 

Goupoa payable on 3 In May 1994 will amount 10 : 

USS 1,02222 per liSS L 00.000.00 Certificate and 

USSt 0,22220 per USS 1 .000.000.00 CcniHoK. respectively 

Mitsubishi Bank (Europe) SA. 

As Agent Bank 


group’s strategy was to ex t end 
the range of services it pro- 
vided to customers in the US 
and UK through, organic 
growth and selective, strategic 
acquisitions. 

There are two new non-exec- 
utive directors; Mr Roger Gra- 
ham, formerly chairman of the 
BES Group before its acquisi- 
tion by ACT and Mr Anthony 
Reeves who was chairman of 
Lifetime Corporation before it 
merged with the Olsten Corpo- 
ration. 

Mr Lambie said he believed 
the group was now better pre- 
pared to handle downturns in 
its chosen markets. 


NEWS DIGEST 


directors of Vistec said they 
had satisfied themselves that 
the operation was now profit- 
able. 

Kenmare Resources 

Kenmare Resources, the Dub- 
lin-based natural resources 
company, announced pre-tax 
profits of 1521,238 (£20,400), for 
the six months to October 31 
against losses of K84.Q27. Earn- 
ings per share were 0.03p, com- 
pared with losses of 0.22p. 

The company has been con- 
centrating on its Ancuabe 
graphite project in northern 
Mozambique and is already 
producing usable graphite to 
industrial grade. 

Select Industries 

Increased pre-tax losses of 
£1.03m were announced by 
Select Industries, the distribu- 
tor of the AlrBoss wheel sys- 
tem in Europe, for the half 
year to December 3L Losses 
last time were £547,000. 

Turnover rose to £459,000 
(£251,000). However there was a 
jump in costs and overheads to 
£L54m (£868,000) including the 
costs associated with the 
group’s admittance to the USM 
in September. 

Losses per share were 0.45p 
(024p). 

The group is ultimately 
owned by AlrBoss of Australia. 

Fairbriar 

Fairbriar, the contract manage- 
ment and property develop- 
ment group, has acquired 
Ilford Park Developments from 
the receivers of Fairfield Park 
Development for £2 cash - its 
net asset value. 

Ilford has not traded, and its 
sole asset is 18.4 acres of resi- 
dential land at Ilford, Essex. It 
has indebtedness of £10.75m, 
which will be repaid from the 
sales proceeds of the develop- 
ment, without any further 
recourse to Fairbriar. 

Arcon 

After normal and oneoff depre- 
ciation charges totalling 
I£3.03m (£25lm), pre-tax losses 
at Arcon International 
Resources, the Dublin-based 
mining group, deepened from. 
I£L21m to 15224m in the year 
to August 3L 

The outcome was struck on' 
turnover up from 15260,000 to 
I£L53m and after interest pay- 
able static at I£90,000. Losses 
per shore emerged at 5.68p 
034p). 

DCS 

DCS Group, computer software 
supplier formerly Nesco Invest- 
ments , reported pre-tax profits 
down from £121,000 to £41,000 
for the six mouths ended 
December 31, reflecting a big 
increase in administrative 


Tomorrows 
Leisure losses 
deepen to £0.2m 


By Chris Tigbe 

Tomorrows Leisure, the 
USM-quoted hotels and leisure 
group based in north east 
England, reported deepening 
pre-tax losses for the six 
months to September 30 1993, 
down to £204,000 against 
010,000 last time 

Operating profits were op at 
£476,000 (£284,000). However, 
increased interest charges of 
£880,000 (£394*000), as a result 
of the higher level of borrow- 
ing following the group’s Plea- 
sure Island investment, poshed 
the group into loss. 

Turnover was ahead at 
£5J12m <J&L48m). 

In November 1993, Tomor- 
row’s Leisure sold Lavender 
Park Golf Centre in Berkshire 
nnd surplus form buildings in 
County Durham. 

It said yesterday that more 
disposals of noorcore assets are 
under active negotiation. Such 
disposals, to reduce the compa- 


ny’s overdraft, and the achieve- 
ment of minim um lev- 

els of trading contribution to 
Croup profits this year, axe 
c on ditio ns of the current sup- 
port from its banker, Barclays, 
to March 3L 

Negotiations have begun 
for facilities beyond this 
data 

"We are taking positive 
action an all fronts,” said 
Tomorrows Leisure chairman 
Mr John Sanderson. He said 
some progress had been made 
on reducing debt, which stood 
at around £L5m on September 
30 1993. 

Mr Sanderson said It was 
encouraging that Redworth 
Hall, the company's County 
Durham hotel, bad increased 
operating profits by 22 per cent 
and that the sale of Lavender 
Park was at a value well above 
that reflected in the March 31 
1903 balance sheet 

There was a loss per share of 
L7p (loss 09p), 


B&F shares suspended 


costs. 

(boss profit showed a 16 per 
cent rise to £1.4m (£L21m) 
despite a foil in turnover from 
£29m to £2fim, resulting from 
a realignment in product mix, 
with a greater proportion being 
in high margin software. 

Earnings per share were 
OBlp (L36p). 

Xtra-Vision 

Xtra-Vision, the USM-traded 
video rentals group, is in Hip 
process of drawing up plans for 
a financial restructuring. 

The company’s syndicate of 
bankers have indicated their 
continuing support. 

European Smaller 

European Small pr Companies, 
the investment trust, reported 
net asset value of 135Bp at 
December 31, compared with 
116-7p at June 30 and 1045p a 
year earlier. 

Net revenue for the six 
months to end-December 
showed losses of £31,000, 
against profits of £242,000. 
Earnings per share were nil, 
compared with 0-68p. 

Quayle Monro 

Quayte Munro Holdings, the 
Edinburgh-based financial ser- 
vices group which came to the 
main market last Jane, 
reported profits of £323,000 pre- 
tax for the six months to 
December 3L 

The outcome, achieved on 
income of £846#», was struck 
after an exceptional provision 
of £45,000 relating to service 
charges on a London office 
occupied by a subsidiary. 

The group’s net asset value 
expanded 24 per emit to £7Am 
over the period. Mr Ian Jones, 
chief executive, said there was 
evidence of increasing eco- 
nomic activity. 

An interim dividend of 3p is 
payable from earnings of 5£p 
per share. 

Tor Inv Trust 

Net asset value of the split-caj^ 
ital Tor Investment Trust stood 
at £16.7ip at January 31, repre 


Sbares in Bennett & Fountain 
Group were suspended at 2%p 
yesterday at the company's 
request 

The board of Bennett & 
Fountain, toe wholesaler rout 
retailer of electrical goods 
being acquired by Marlowe 
Holdings, has expressed con- 


senting a year-on-year advance 
of some 39 per cent and an 
improvement of almost 23 per 
cent on the figure at the trust’s 
year-end in July. 

Net revenue for - the six 
to endrJanoary rose to 
£693,000 (£593,000). helped by 
receipt of scrip dividends, for 
earnings of 17.i56p (I4.666p) 
per income share. 

A second interim of lOp per 
income share maintains toe 
total to date at 20p; directors 
again expect to pay a total of 
40p for the year, requiring a 
small transfer from revenue 
reserves. 

Travis Perkins 

Travis Perkins, the timber and 
b uilding mater ials merchant, 
has exchanged contracts with 
Liverpool Victoria Friendly 
Society for the sale and lease- 
back of Brackmills, the main 
distribution depot for Travis’s 
heating and plumbing activi- 
ties in Northampton. 

The total consideration is 
£l?.-3m cash, and the lease to 
be entered into will be for 20 
years with a five-year review 
period. 

Wm Ransom & Son 

William Ransom & Son, the 
pharmaceutical products 
make:, said the dispute con- 
cerning costs relating to the 
proposed acquisition of a prop- 
erty in Biggleswade; Bedford- 
shire, had been settled aud it 
had received £325,000 including 
all costs and expenses. 

Trading in the fourth quarto- 
continued to be patchy, the 
company said, and it expected 
pre-tax profits far toe year to 
be between 52900,000 and £Lm, 
including toe above settle- 
ment 

The shares fell Ip to 63p. 

Bolton Group 

Bolton Group, property inves- 
tor, lifted pre-tax profits from 
£21,000 to £183,000 in toe six 
months ended October 31 1993, 
on turnover down from £L21m 
to £720J)00. 

The results reflect the effect 
of disposals of investment 


cem that its shareholders may 
have , insufficient information 
to assess the merits of 
Marlowe's offer. In view of 
this, Marlowe has agreed to 
extend the closing date of the 
offer until two weeks after the 
announcement of B&F’s 
results. 


properties and the sale of a 
subsidiary. Funds from these 
disposals have been used to 
reduce borrowings and financ- 
ing costs. The latter are down 
from £829,000 to £446j000. 

The deficit on the profit and 
loss account has been reduced 
from £L23m to £74,000 and the 
directors hope to eliminate it 
in the near future. Earnings 
per share rose from 0.2p to 
lfip.There is again no divi- 
dend. 

Prudential Corp 

Prudential Corporation’s US 
subsidiary Jackson National 
Life Insurance saw a decrease 
In pre-tax earnings for 1393 
from $339. lm (£23 2m) -to 
$239.5m. 

Premiums were down at 
$2.Q6bn ($2.97bn). Assets 
increased to $l6-9bn ($lA8bn). 

Countrywide Bank 

Countrywide Banking Corpora- 
tion, the New Zealand subsid- 
iary of Bank of Scotland, 
achieved pre-tax profits of 
NZ$415m (£16m) for the year 
to December 3L 
The post-tax figures showed 
a profit of NZ$27-5m, against a 
loss of NZ$50.7m, after extraor- 
dinary costs of the merger with 
United Bank. 

Ora: the year assets grew by 
21 per cent to NZ#L25bn 
(NZ$3.41bo). 

Gartmore Scotland 

Net asset value per capital 
share at The Gartmore Scot- 
land Investment Trust rose 28 
per cent from 249p to 3H5p 
over the six months to January 
L 

Gross revenue advanced to 
£976,000 (£898,000) in the first 
half; on the back of £119,000 
(nil) coming from e nhanc ed 
scrip dividends. Interest on 
deposits fell to £28^00 (£ 68 , 000 ). 
Administrative expenses rose 
to £191,000 (QL45JXM) and net 
revenue to E644JM0 (£562,000). 

Earnings were 4.76p (4_l5p) 
per share and the second 
interi m dividend is held at 2.4p 
for a total at the halfway stage 
of 4JBp. 


Statement by the directors of 
Harmony Gold Mining Company Limited concerning 
the slimes dam disaster 

The major focus of Management's attention is, and must remain the location of missing 
persons and the care of the victims. 

In this regard every conceivable effort is being undertaken and operations are proceeding 
around the dock. No expense or effort will be spared until the completion of this task. Victims 
are befog cared for where necessary and sufficient funds have been made available to address 
their immediate needs. 

The cause of the dam failure remains unknown at this stage. Considerable speculation has 
occurred in the media regarding the extent to which Harmony Gold Mining Company 
Management and toe slimes dam contractors, Fraser Alexander, are responsible for the 
disaster. 

Such speculation, whilst understandable, is premature and is making an already difficult 
situation worse. ^ The spread of rumours is serving to demoralise employees and divert attention 
and effort way from the immedfote tasks of locating missing persons and caring for victims. 
The Management of the mine urges the speedy establishment of official enquiries into the 
causes of the disaster and will co-operate folly with them. - 

We firmly believe that the legal process be allowed to follow its proper course without delay 
and toe Determination of liability must be left to the courts. 

Rumours have also been circulating regarding the toxicity of the slime. At this stage no one 
admitted to the Harmony Gold Mine hospital has been found to be suffering from any wound, 
skin irritation or dermatitis caused by iL The cyanide level is '/sthe legal limit and the Ph 
stands at a level dose to that of water, which is neutral. 

HnaDy, we wish to once again record our thanks to all who have and are continuing to assist 
us, and to express our deepest condolences and sympathy to the families and friends of 
those who have been taken from us. 

The Director*. Harmony Gold Mining Company Limited 

Harmony Gold Mining Company Limited 

(bc oi pan w d in ika Republic of South Also) (Rcgirtntiaa No. 0S/3S233J0S) 


JPS Turner (ChatmonJ, £8 Coder 


Director/, ffl? da ViBiers.JC Hoff. MR Heyro, AA Scaley. 
{Abematc Director] 


% 


f a 
















' '“'Wndtl 



FINANCIAL times TUESDAY MARCH 1 1994 


COMPANY NEWS: UK 


29 


£30.8m housing buy 
for Taylor Woodrow 


By Andrew Taytor, 

Construction Correspondent 

Taylor Woodrow construction 
and property group is paying 
£30 Bn to acquire the house- 
building assets of debt-laden 
Heron International, the prop- 
erty and trading company for- 
merly controlled by Mr Gerald 
Ronson. 

The deal is the latest in a 
series of land purchases by UK 
housebuilders, anxious to 
'increase output to take advan- 
tage of the recovery in the UK 
housing market 

Heron last year concluded 
a £l.4bn refinancing, 
swapping some of its debt for 
equity. 

It has been raising cash 
from disposals to meet its 
revised repayment obligations. 

Heron Corporation, the 
group’s trading arm, has 


Corporate 
Services in 
profit 

Following its midway 
tumround to profits. Corpo- 
rate Services Group, the 
USM-qnoted recruitment agen- 
cies and services concern, fin- 
ished 1993 with pre-tax profits 
of £877,000, compared with 
losses of £L55m. 

Earnings per share were 
2.73 d, against losses of &04p, 
while the company returns to 
the dividend list with a pro- 
posed distribution of 0i25pi 

Mr Jeffrey Fowler, chair- 
man, who reported turnover 
up from £31.3m to £42.1m over 
the 12 months, said he looked 
forward to continued gr owth 
in the current year. 

He stated that steps had 
been taken to rationalise the 
cost structure of acquisitions 
made during the year. 


already made early repayment 
of £l50m which had been 
due at the end of next 
month. 

The parent company, how- 
ever, needs to repay a further 
SSZSm, also by the end of next 
month. 

The former Heron land and 
homes -is in southern anrl 
south west England and 
Cardiff. 

The Heron housebuilding 
assets Include about 1,100 
housing sites and almost 200 
homes in various stages of 
completion. 

The purchase will allow Tay- 
lor Woodrow to increase its UK 
housebuilding. 

Taylor Woodrow is a 
southern-based builder which 
has recently expanded its 
operations to Yorkshire ami 
Humberside. It has also been 
restructuring its Scottish 


operations. The company Is 
thought to have sold approach- 
ing 1,000 homes last year and 
Is looking to increase output 
farther in the nys^um term. 

Its recent land purchases are 
thought to have been averag- 
ing between £15j000 and £16,000 
per plot 

The land acquired from 
Heron is thought to have cost 
slightly more per plot, so the 
purchase should alio help Tay- 
lor Woodrow meet its aim of 
building larger, more expen- 
sive, higher margin homes. 
The average price of a Heron 
home is about £85,000 com- 
pared with about £77,000 for a 
Taylor Woodrow home. 

Mr Gerald Ronson remained 
as chief executive of Heron fol- 
lowing the refinancing but was 
replaced as chairman by Lord 
Boardman, former Chairman of 
NatWest Bank. 


Upton & Southern cuts 
losses to £321,000 
after reorganisation 


Following a period of 
reorganisation, Upton & 
Southern Holding s, the retailer 
which is buying the Reject 
Shop chain, reported reduced 
losses for the 52 weeks to Janu- 
ary 29. 

The pre-tax deficit for the 
period amounted to £321,000, 
against £636,000 for the 
previous 53 weeks. Turnover 
fell from £10.7m to £8.67m. 
Of which £685,000 (£2. 79zn) 
came from discontinued 
operations. Losses per share 
were reduced from 7.03p to 
0.29p. 

In the latter 24 weeks of the 
period the' company swung 
back into the black with a 
profit before tax of £176,000. 
However, this included a 
£92,000 profit from the sale of 


the Huddersfield investment 
property and the company's 
participation in a development 
in Kettering, the directors 
said. 

Upton has changed its year 
end to July 31, a move made in 
contemplation of the proposed 
acquisition for £2 Bn of The 
Reject Shop. 

Agreement had been reached 
on the purchase which, for 
management acco unting pur- 
poses, would be operated as a 
separate cost centre from the 
group's retail business, said Mr 
James Hodkinson, Upton's 
chairman. 

The benefits from the acqui- 
xHSon would begin to be seen 
in the new accounting year 
commencing August 1, he 
added. 


Losses 
deepen at 
Midland & 
Scottish 

By David BtockweB 

Midland & Scottish Resources, 
which is in the process of run- 
ning down production at the 
Emerald oilfield east of Shet- 
land, yesterday repented a pre- 
tax loss of £ 18.4m for the six 
months to end-Jnne last year. 

The group blamed the loss 
on an exceptional charge of 
£17m, representing the write- 
off of capital expenditure 
incurred in drilling additional 
wells in the field, which 
proved unsuccessful. Turnover 
from continuing operations 
was £35.4m. 

In first-half 1992 the group 
lost £1.9m on turnover of 
£i.9m. For the 1992-93 year 
the group was £113Bn in the 
red after writing off the entire 
value of the Emerald develop- 
ment 

In January Midland said its 
two subsidiaries that ran the 
oilfield had sent a proposal to 
their creditors for a voluntary 
arrangement under the Insol- 
vency Act 1986. 

Trafalgar House, owner of 
the Emerald Producer rig. and 
MSB, which owns the floating 
storage unit, have halved their 
charter rates until creditors 
have been paid 50p in the 
poind. 

The field's fife now hangs on 
when the operating equipment 
can be redeployed. 

Midland's future depends on 
Spirit of Columbus, a floating 
production platform being 
built in Italy. The group said 
delivery was planned for the 
coming summer, and described 
prospects for its deployment 
as “good". 

Administration expenses, 
including charges associated 
with the Italian project, were 
up from £2.im to SASm. Net 
interest payable was £3.5m, 
compared with a previous 
£300,000. 

Losses per share were 9.12p, 
against with OJISp last time. 


Acquisitions boost Lilleshall 


By Tim Burt 

Contributions from new 
subsidiaries and reduced bor- 
rowings helped Lilleshall. the 
industrial distribution and 
building products group, 
increase profits by 35 per cent 
last year. 

Pre-tax profits rose to £&9m 
(£3. 12m) in the 12 months to 
December 31, thanks mainly to 
a combined gain of £771,000 
from St Helens Glass and Jay 
Fasteners, which it acquired 
during the year. 

The acquisitions - together 
with a foil year’s contribution 
from Barlow Fasteners, 
acquired in December 1992 - 


boosted operating profits by 
48.2 per cent to £4J27m 
(£2JB8m). 

Funds raised, meanwhile, by 
the group's £9-B7m rights issue 
to acquire St Helens last Sep- 
tember. were also used to cut 
borrowings by £5 -04m. leaving 
year-end gearing at 3.2 per 
cent 

The Newbury-based group 
said yesterday it had taken 
advantage of low gearing and 
cash reserves of £3.55m 
(£ l.74m) to acquire Trutite Fas- 
teners, the UK subsidiary of 
Koninklijke KNP BT, the 
Dutch paper group. 

T.Weghall paid £562,151 «wb 
and repaid £1.25m of intercom- 


pany debt with, a further 
£300,000 payable at the end of 
1994. Mr John Leek, chairman, 
said the acquisition would lead 
to a significant expansion of 
LiUeshaR’s industrial consum- 
ables division. 

The industrial consumables 
division, dominated by fastener 
manufacturing, was last year 
the only sector to report 
increased profits. 

A rationalisation programme 
and significant Income from 
Barlow Fasteners helped the 
division make an £806.000 
profit, compared with a 
£963,000 loss last time. 

Although it was the smallest 
contributor to group operating 


profits, Mr Leek said its results 
were encouraging compared 
with the “very disappointing" 
performance of building prod- 
ucts, the company's largest 
division. 

Profits from building prod- 
ucts - including St Helens 
Glass - fell to £2J24m (£L3lm). 
Pressure on margins also hit 
the plastics and engineering 
division, which saw profits 
decline to £iJ7ftt (£1.68). 

All the divisions, however, 
increased sales and group turn- 
over rose 16 per cent to 260.5m. 

Earnings per share rose to 
IQp (9.2p). and the final divi- 
dend is lifted from 2.65p to 
255p, making -L55p. 


Canadian Pizza just ahead 
of forecast with £3.2m 


By Simon Davies 

Canadian Pizza, the recently-floated pizza and 
pizza crust maker, announced pre-tax profits of 
SL2m for 1993, marginally ahead or its prospec- 
tus forecast 

Sales were constrained during the second half 
as the Salford manufacturing plant reached full 
capacity, but a £12m upgrade has now been 
completed, adding 20 per cent capacity. 

Turnover increased by 17.6 per cent to £ 17.9m 
during 1993, and operating profit margins were 
maintained, in spite of continued pricing pres- 
sure in its main business, the sale of pizza 
crusts to retailers. 

Retail sales grew by 20 per cent, accounting 
for 54 per cent of turnover and 38 per cent of 


profits. The other significant area of growth was 
export sales, which grew by 9 per cent to 24.7m, 
primarily on sales to continental Europe. 

The company is looking at sites for a manu- 
facturing operation in continental Europe. This 
is likely to be built in France, involving a maxi- 
mum investment of £Z0m. Construction should 
start in 19%. It is also looking to expand sales to 
the Pacific Rim. 

The company raised £i5m from its November 
flotation in November, which paid off senior 
debt and preference shares, leaving the com- 
pany ungeared. It said it would not call on 
shareholders to fond any expansion plans. 

Earnings per share amounted to 129p. and a 
final dividend of 3.6p is proposed, in line with its 
prospectus forecast. 


Healthcare Holdings talks off 


Healthcare Holdings, an owner 
and operator of hospitals, has 
invited its bankers to appoint a 
receiver after talks with a third 
party failed to produce an offer 
for it 

The company had said on 
January 28 that it had entered 
into non-binding heads of 
agreement with a third party 
on a recommended offer. It 


said yesterday that no final 
agreement had been reached. 

The directors of Healthcare 
said that after lengthy discus- 
sions with all parties the board 
had concluded that there was 
no longer any reasonable pros- 
pect of completing a deal 
which would safeguard the 
interests of creditors and pre- 
serve value for shareholders. 


Shares in Healthcare were 
suspended in January at the 
company's request, and publi- 
cation of the results tor the 18 
months to June 30 1993 was 
delayed pending the outcome 
of restructuring talks. 

Mr Paul Jarrett and Mr 
James Hughes have resigned 
as directors, but will provide 
assistance to the receiver. 


High-Point 
falls to 
£93,000 

Pre-tax profits of High-Point, 
the specialist consultancy and 
project promotion company, 
fell from £166,000 to £93,000 in 
the six months to November 
30. 

The outcome was achieved 
on turnover down from £26,tm 
to £22. 6m, however, last year’s 
figure included almost £5m 
from discontinued opera- 
tions. 

The Interest charge was 
almost halved, from £l.03m to 
£589,000, principally, the 
directors said, because of the 
lower level of borrowings. 
Earnings per share emerged at 
0.8p (3-lp). 

UK operations were still 
suffering the effects of what 
is, hopefully, the tall end of 
the recession, the company 
said, while the US had a dis- 
appointing half year, mainly 
dne to lack of activity in cer- 
tain of its east coast 
operations. 

Asia and the Pacific Rim 
was, however, achieving 
expectations regarding both 
growth and profitability, it 
added. 


INTERNATIONAL ECONOMIC INDICATORS: PRODUCTION AND EMPLOYMENT 


Yaoriy data far retail sales volume and JndusiiW production plus al data far the vacancy rate Indicator am Jn indue farm uWi 198&-10O. Quertorty and monthly data tor ratal! sales and Industrial production show ths percentage change over the caraspondng ported in lha previous yaor, and ara positive atharwiao stated, fha unamptoymaM rate la shown as a 
pw M Qi of ttw total laboa law. Pgwt tar me c ompoaH a fratlnQ Indcator are and-pertod valute- 



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10S5 
108.4 
112 A 
115.6 
118l5 
114J2 
117J 

100.0 

10X3 

106-0 

1107 

112A 

112.4 

1103 

112-9 

117.® 

7.1 

39 

ftl 

5.4 

5 2 
34 

36 
72 

37 

100.0 

930 

105-5 

1031 

99J3 

84.8 

622 

Ml 

833 

102-4 

107.1 

1032 

1122 

1137 

1035 

1112 

117-0 

1230 

1030 

106-5 

1138 

122-6 

132-5 

1412 

144.6 

1393 

1030 
937 

1031 
1131 
1137 
1243 
1238 
1130 
1136 

36 

23 

22 

25 

22 

2.1 

2.1 

22 

25 

1002 

943 

1033 

1353 

1473 

1438 

1442 

1242 

10&D 

973 

1031 

115-2 

1222 

1252 

1223 

1203 

1231 

1002 

1034 

107.4 

1105 

114.1 

1235 

1305 

1231 

123.0 

1003 

1022 

108.6 

1033 

1113 

1172 

120.7 

119.1 

1139 

7.1 

8.4 

32 

62 

53 

43 

42 

43 
53 

1030 

1334 

148.4 

1643 

2137 

261.1 

2737 

2802 

1973 

1031 

1030 

1031 
1122 
1151 
1157 
1129 
1037 
1155 

1003 

1024 

1045 

1073 

1095 

110.1 

109.7 

1083 

1085 

1030 

101.1 

1051 

1073 

1113 

1129 

1152 

1152 

109.7 

103 

ia< 

105 

10.0 

34 

83 

95 

10.4 

113 

1003 

1072 

117.7 
134.9 
181.1 
1650 

127.7 
1113 

893 

1020 

1092 

1083 

1157 

1135 

1083 

100.6 

1073 

1103 

1003 

1063 

1121 

1083 

1163 

1143 

1103 

1163 

1003 

104.1 

1083 

1142 

1137 

1130 

1154 

1158 

93 

10.4 

109- 

103 

103 

103 

93 

9.8 

1056 

1107 

112.7 

117.7 
1152 

111.7 
1143 
1112 

' 1000 
1053 
1107 
1173 
1201 
121.1 
1193 
1205 
124.7 

1000 

1024 

1035 

1113 

114.0 

1157 

1092 

1037 

1116 

112 

112 

103 

36 
72 
63 

37 
9.9 
103 

1000 

1131 

1412 

1443 

124.7 

931 

683 

70.1 

77,3 

1024 

1053 

1105 

1007 

106.4 
1042 
1031 
1133 

121.4 

1966 

1986 

1987 

1988 

1989 

1990 

1991 

1992 

1993 


3.7 

4.4 

39 

622 

117.7 

-63 

-5.1 

23 

1155 

1233 

-4.7 

-93 

53 

213.4 

1063 

ai 

JMM'M 

11.0 

96.0 

106.1 

22 

-43 

93 

1154 

32 

13 

105 

733 

1106 

1st qtr.1993 

2nd qtr.1993 

53 

3-8 

6-9 

637 

1172 

-30 

-43 

2.4 

1062 

1243 

-37 

-62 

53 

2073 

109.0 

1.1 

ffil 

11.5 

913 

1073 


-43 

106 

114.7 

33 

27 

103 

74.1 

117.1 

2nd qtr.1993 

3rd qtr.1B03 

S3 

42. 

6.7 

630 

1137 

-31 

-38 

25 

1013 

1237 

-31 

-83 

39 

1933 

1123 

03 


11.7 

853 

1083 


-12 

103 

1136 

33 

27 

104 

77.1 

1204 

3nl qtr.1993 

4th qtr.lOQQ 


42 

34 

634 

123X1 


-43 

25 

1012 


-35 

-31 

33 

1755 

1135 

03 


120 

854 

1103 





37 

55 

103 

84.7 

121.4 

4th qtr.1993 

February 19S3 

32 

4£ 

39 

635 

117.7 

-S3 

-36 

22 

1130 

12T.7 

-43 

-113 

53 

213.4 

1034 

-33 

-22 

11.0 

636 

1063 

-92 

-43 

n.a. 

1123 

23 

13 

105 

724 

116.1 

1893 February 

Mmh 

30 

42 

39 

62-8 

117.7 

-32 

-2-0 

22 

1236 

1233 

-1.8 

-35 

55 

211.0 

1038 

43 

-50 

112 

96.0 

1031 

02 

-4.7 

rva. 

1134 

43 

13 

ia4 

750 

1106 

Mwch 

April 

4.7 

3 2 

39 

622 

117X1 

-S3 

-4.1 

22 

1036 

1243 

-22 

-93 

55 

2103 

1074 

1.1 

-51 

11.4 

850 

1063 

21 

-58 

fUL 

1137 

2.7 

13 

103 

74.0 

118.7 

April 

May 

52 

30 

39 

031 

117.1 

-42 

-42 

25 

102.6 

1252 . 

-53 

-62 

5.6 

207.6 

1073 

-51 

-32 

115 

89.1 

1073 

-9.9 

-43 

fUL 

114.1 

24 

45 

103 

74.9 

1108 

May 


ao 

4.0 

38 

031 

1172 

-82 

-43 

25 

1034 

1243 

-34 

-7.4 

57 

2052 

1093 

53 

-57 

11.8 

913 

1073 


-39 

rua. 

114.7 

33 

27 

103 

728 

117.1 

June 

July 

ai 

3-8 

37 

636 

1131 

-53 

-45 

25 

1003 

1252 

-37 

-7.7 

53 

202.7 

1130 

13 

-26 

11.7 

93.9 

1063 


-53 

IUL 

1157 

4.4 

58 

104 

77.1 

1173 

July 


ao 

42 

37 

037 

1137 

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-2.6 

2.5 

1033 

125.8 

-37 

-55 

59 

1945 

I1T-3 

-03 

-50 

11.7 

60 14 

107.4 


04 

IU 

117.0 

58 

26 

10.4 

77.4 

1192 

August 


5-6 

4.4 

30 

635 

1137 

-35 

-4.4 

25 

993 

1237 

-13 

-5.7 

31 

1857 

1123 

21 

-52 

113 

803 

1083 


-0.7 

r»A 

1163 

34 

21 

104 

783 

1204 

September 


ae 

4.1 

36 

035 


-52 

-63 

2J 

983 

1272 

-37 

-4.0 

32 

174.7 

1127 

-13 

-45 

120 

857 

1093 


-1.7 

IUL 

1195 

32 

25 

102 

812 

1207 

October 


as 

42 

34 

039 

122.0 

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-32 

22 

1042 

1273 

-53 

-33 

63 

174.7 

1151 

22 

-03 

120 

852 

1 102 


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flh. 

1212 

32 

33 

103 

852 

120.7 

November 



4.5 

33 

737 

1232 


-45 

23 

102.4 


-7.7 

-12 

33 

1730 

1155 

-02 

31 

120 

873 

1103 



rxa. 


4.1 

43 

95 

073 

121.4 

December 

January 1894 


4.8 

38 




-31 







1862 









rua. 


33 



857 


1994 January 


Ai mim anaonflv -Areret stabrites tor Qmtwiy apt* orty to western Germany- Ma suppled by DntaMran and WEFA. Hated antes vafcmsc data tan nsttanri Bovamment sauces except Japan and Italy (value sodas donated tjy OECD tatog CPQ. Rrtora to tool retail oaten except Rancw and llnly (major outteteorty) and Japan Jdopartmanl storos arty). 
Industrial pmsfiSreStatan national government sources. Inductee mWnft manufacturing, gas, etecirlcty and water supply mouaotea incept Japan (mining and monutartiring cnM and UK (also todudro construction Industries), Uwmploywant rate OBCP stanOartfced r ate wh ich fffra teante r as poaate te tor the rtflorara daflrattaw of uMmptamemtaed In 

Stewart vacancy wmoi » rtricted by Mai rtriten smpfcywwri; Harassed In ted « term. Drived tan OECD serin US - he^wamad sdwsrtWng, Japan - new vacancies, Germany and France - al fobs vacant. Hdy - no date ovaiabte UK - unfiBod vacancies. Compoafte tatters Indicator 06C0 data Each ia a 
combination of series. cycical fluctuations In which usuafly precede cycled fluctuations m earned econorrto adMy. 


FORWARD TRUST LIMITED 

DEPOSIT RATES 


With effect from 1 April, 1904 th® following rates w# apply to 
a& Forward Trust Limited notice accounts. 


Notice Period 

GrosS%PA 

Not%PA 

Gross** 




Equivalent % 




PA 

• 7 days 

3.75 

2.81 

3.79 

1 month 

4.00 

3.00 

4.04 

3 months 

4.25 

3.19 

450 

6 months 

4.375 

3.28 

4.42 

12 months 

45 

358 

4.55 


• Applies to existing accounts only. New accounts at 7 days notice 
not accepted 

•* Annual rate when Ml half yearly interest remains invested. 

Interest on the above accounts Is paid or credited twtoe yearly. 
Interest rates ara subfed to variation. 


FORWARD TRUST 
6BG0P 

FUi information aboid Notice Accounts Is auaflaHft 9wrc 

Forward Trust Limited, Deposls Department. 

12 Catthorpe Road. OrmhQham. 015 1QZ. Tefephona 081 455 3417 

SOCIETE CONCESSIONNAIRE FRANQAISE 
POUR LA CONSTRUCTION ET SEXPLOITATION 
DU TUNNEL ROUTTER SOUS LE MONT -BLANC 
FRF 450,000,000 FLOATING RATE NOTES 1987 - 1997 
In accordance wfih th® provislotwof foe 

that tbs rate tor the period bom February 28 ,1 994 to May 31 . 1994 me 

been fixed at 6.4375% pet annum. 

_ igg4 interest of FRF 164.51 per FRF 1 0.000 nominal 

of FHF 1,645.14 par FRF ,60.000 

(London). 

Rscal Agent 


ft 



Tufton Oceanic 
Investments Limited 

has bear formed as tbe result of a merger between: 

Oceanic Finance Corporation Ltd 
Oceanic Financial Services Ltd 
International Shipping Investment Company Ltd 
Tufton Associates Ltd 
Tufton AB 

Tufton Oceanic Limited 

(a wholly owned subsidiary ofT ufton Oceanic Investments Limited) 

Little Tufton House . 3 Dean Trench Street 
London SWIP3HB 
21 February 1994 


Tufton Oceanic is a member of ike Securities and Futures Authority. 


YOKOHAMA ASIA LIMITED 
(Incorporated in Hong Kong) 

U J&jfcl 00.000.000 

GUARANTEED FLOATING RATE NOTES DUE 1997 


& 


Unco n J Itin n al y sad i r w vo ca l i iy gua rant ee d by 
THE RANK OF YOKOHAMA, LTD. 

(Incorporated in Japan) 

Node® is hereby given that th® Rate of interest for the initial 
interest period has been fixed at 4% per annum and that the 
Interest payable on the relevant Interest Payment Date May 
37, 1894 against Coupon No. 35 in respect of US$10,000 
nominal' of the Notes will be US$102.22 and in respect of 
USS250.000 nominal of the notes wtB ba USS235SS6. 

MMh T, 1984. London jurym a >MU|k 

By. CWbarfc. NA- (Issuer Services], Agom Bank CflfOAfVCMp 


U.S. $300,000,000 

Scotiabank S 

THE BANK OF NOVA SCOTIA 

Floating Rate Subordinated 
Capital Debentures Due 2085 


Interest Rate 
Interest Period 


4 , 125 % ixa. 


28th February 1994 
31st August 1994 

Interest Amount due 
31st August 1994 

per U.S. $ 10,000 Debenture U-S.S 210:83 
per U.S. $100,000 Debenture U.S. $2,108.33 


CS First Boston 
Agent 


Can. S75.000.000 

Province of New Brunswick 


due May ISM 

Nodes b hereby ftivwn that in nwpoct 
of tea flnar Interest Purtocf ham Fob- 
ruary 28, to May 31. ISM the 
Notas vriB carry on Inuvosf Rata of 
52% peramun. The amounts pay 
able on May 31, IBM. squirm 
Coupon Na 40 wM be Can. 5134.17 
tar Beane Notes of Owl 610,000 
amount and Can. 513.48 lor 

Notes of Can. 51.000 principal 

amount. 

BriknmiiaMtNBvUU- 

lonko, Avert 8 uk Q 

March 1.18B4 


principal < 
Bearer Nt 



ntiuo 


®y to 


mwrily «» tor*ut red no* admneed 
k tea wodri. Ida rtunZaateppertn* now 
war fcami tapOnatloa* ter turn matirm 
world. Ikb nmr wlH tbaretera to 
moMtlal reading for bay daateta 
i to arer 3Z0 coatetea MBddnWa. 


To oAwitteo ta this army, cal: 
Antony Carbonari or Mstonlo Bwtm 

In (tew tak 

Tel: 212 7BZ 4600 
Roc 212 SIS 0704 

AActe Andrews 

k London 

Ibfc 0713733585 071873300 

FT Surveys 


ABC International Bank pic 


regrets to announce the demise of 


Hikmaft Sharif Nashashibi 


a well respected friend and colleague 


condolences may be sent 
by fax to 071 606 9987 


23 February 1994 


U.S. $100,000,000 

First Bank System, Inc, 

Floating Rate Subordinated 
Capital Notes Due 1997 


Interest Rate 
Interest Period 


574% 


per annum 


28th February 1994 
31st May 1994 


☆ PROPERTY FINANCE ☆ 

Naw sourest for ooaraarctel proparttes; up to 90% loan to vakiabon; moat 
corrTp&jtta] and Ooxtato Kxms: MJrtmun £600.000. Contact Richard von G6lzoa 
Ucfaa! Laurie Partnorotep Ud (Mfimtwr or the 5FA) 

Tat 071 4S3 7050 Fax: 071 489 6279 


Interest Amount per 
U.S. $50,000 Note due 
3!« May 1994 U.S. $670.83 

CS First Boston 

Agent 


a-. “ 











30 


glNAJS CJAL TEVPES TUESDAY MARCH 1 1994 

COMMODITIES AND AGRICULTURE . 


China seen pushing copper 


Norway desperate to head off slide in oil output 


market into supply deficit 


By Kenneth Gooding, 

Mnmg Correspondent 

China's huge appetite for 
copper would help the market 
in the western world move to a 
supply shortage this year after 
two years of surpluses, accord- 
ing to Mr Richard Osborne, 
chairman of Asarco. the US 
metals group. 

He said yesterday that, 
although government mea- 
sures to control inflation in 
China were forecast to cot the 
annual growth in its copper 
consumption from an average 
of 12.5 per cent since 1989 to 3 
per cent this year, the 
republic's imports of the metal 
would grow by twice that rata, 
from 330,000 short tons (2,0001b 
each) last year to 350,000 tons. 

Meanwhile, Asarco predicted 
exports to the west by Poland 
would rise from 281,000 tons to 

295,000 tons hut Russian 
exports were likely to slip from 


325.000 to 281,000 tons. This 
would give a modest fall in net 
imports to the west, from 

269.000 to 262,000 tons. 

Asarco expected copper con- 
sumption outside the former 
eastern bloc countries to grow 
by nearly 3 per cent in 1994, 
from just over 10m tons last 
year to 1026m tons, while pro- 
duction of refined copper was 
predicted to go up by only 0.6 
per cent, from 9.94m to 10m 
tons. 

This would leave a supply 
deficit of 61,000 tons compared 
with surpluses of 140,000 tons 
last year and 35,000 tons in 
1992. 

Mr Osborne, at a meeting 
with investment manage rs and 
analysts in London, predicted 
copper stocks in the west, at 
present equivalent to seven 
weeks consumption, would 
start coming down towards the 
five weeks with which the 
industry was comfortable. 


Dealing with other some 
metals, Mr Osborne forecast 
that the lead market would 
also move to a supply deficit 
tills year - one of 20,000 tons - 
after surpluses of 131,000 
tons in 1993 and 168,000 tons in 
1992. 

On the other hand the tinn 
market was forecast to show a 
surplus for the fifth consecu- 
tive yean one of 124,000 tons 
against 460,000 tons in 1993 and 
450200 tons in 1992. 

Mr Osborne pointed out that 
demand for silver had out- 
paced supply for the past five 
years and suggested that the 
evness stocks built up in the 
1980s would be eliminated in 
two years. Asarco would not 
re-open its three silver mines 
until there was a long-term sil- 
ver price of $7 a troy ounce. 
“The odds on that happening 
are improving each month. 
Perhaps we will see that before 
the decade is out.” 


MARKET REPORT 

Copper rallies after early fall 


COPPER prices recovered early 
losses at the London Metal 
Exchange yesterday while the 
ALUMINIUM market remained 
nervous as the second round of 
inter -government talks on the 
industry got under way in Ott- 
awa. 

The three months copper 
price drifted down to $1,880 a 
tnnna in the morning, but sup- 
port at that level held once 
more and the pries bounced to 
$1282 before closing the after 
hours “kerb” session at $L888, 
up $8 on the day. Dealers 
thought, however, that another 
test of underlying support was 
likely soon unless further 
headway was made on the 
upside. 

Aluminium prices were 
depressed initially by an indi- 
cation by Comalco of Australia 
of reluctance to cut output at 
its “efficient" Boyne Island and 
Piwai point smelters. But later 
news that Alba of Bahrain was 
discussing possible output cuts 


with other Middle Eastern pro- 
ducers, a change of tack from 
its previous position, gave 
prices a lift. The three months 
price, which had dipped to 
$1,305 a tonne at one point, 
ended the kerb session at 
$1,809, down $7.50 from Friday. 

The ZINC market was hit by 
Japan’s trade and industry 
ministry showing domestic 
stocks sharply up in January 
and the European Zinc Insti- 
tute releasing similar data for 
world smelters’ stocks. Traders 
said thin once a gain underlined 
the problem facing the world's 
zinc industry and the three 
months price fell to $869 a 
tonne, down $7. Dealers noted 
that zinc t rading was subdued, 
with many partici pants attend- 
ing an industry conference in 
the UJS. 

At the London Commodity 
Exchange COFFEE and 
COCOA futures extended 
morning retreats, last week’s 
failure to break through key 


resistance causing the two 
markets to slide towards tech- 
nical support, traders said. 

By the close May delivery 
coffee, further depressed by a 
weak opening in New York, 
had fallen $23 on Fhg day to 
$1,212 a tonne. 

Traders said there was little 
fresh news to help the market 
out of the current doldrums 
and some predicted a test of 
support at $L200 or even the 
chart gap between $U85 and 
$1,190 later this week. 

Cocoa fared little better, the 
May position ending £16 down 
at £910 a tonne. 

Dealers said, however, that 
there had been pockets of trade 
buying around and they expec- 
ted the slide to run out of 
steam before May reached the 
psychological-important £900- 
mark. “The market stalled 
under a bit of switching pres- 
sure but I don’t think we’re 
into a reversal yet,” one said. 
Compiled from Reuter 


Karan Fosafl In Oslo 

Norway's Labour government 
is proposing a comprehensive 
overhaul erf energy policy in a 
desperate attempt to stimulate 
petroleum activities and stem 
a steep decline in crude oil pro- 
duction after 1996. 

The country is western 
Europe’s biggest oil producer 
with daily output of 2Am bar- 
rels, and is the fourth biggest 
crude oil exporter in the world. 

Oil companies argue the best 
way to boost activities is to 
ease the stringent tax regime. 
But in a White Paper presented 
last Friday to the Storting, 
Norway's parliament, the con- 
troversial tax issue went 
unmentta aed 


In the White Paper, the gov- 
ernment recommended that 
exploration acreage be expan- 
ded by 16 per cent and rules for 
exploring in t* 1 ** Barents Sea be 
reformed to make it more 
attractive. It also intends to 
speed up the process for 
approving oU discoveries.' A 
number of proposals were 
made to streamline lic ensin g 
rules and mana g ement of the 
state's oil and gas resources. 

Tgrrp f rrun rrwntg Ha ht and fish- 
erman fiercely oppose the 
move to expand exploration to 
the Skagerrak, about 50km off 
the southern coast of Norway, 
and to hew areas of the Norwe- 
gian Sea, off the coast of mid- 
Norway. Under the proposals, 
in the Skagerrak, just four 


exploration wells will be 

allowed to be drilled; only one 
rig will be allowed to work in 
the area at a time; and, «WTHwg 
during the summer - peak har- 
vest season for prawns - has 
been ruled out 

In the Norwegian Sea, six 
wells will be allowed in the 
Nordland VI area during a lim- 
ited period of the year with. 
Just one rig operating at a 
time. In the Barents Sea, where 
52 wells have so far failed to 
yield any commercial discov- 
eries, changes to licensing con- 
ditions have been proposed, to 
cut the cost of exploring there. 

Norway has little choice hut 
to stimulate oil activity; not 
only will output flapitna dra- 
matically in two years time. 


from a peak of 28m barrels a 
day, but the country is also 
faced with stiffer competition 
for oil company Investment 
Last year Norway boosted 
recoverable petroleum reserves 
by 259m tonnes of oil equiva- 
lent to 59Sbn tonnes, but the 
increase was due to adjust- 
ments to reserves of producing 
fields and discoveries not yet 
developed, rather than to 
exploration success. Out of a 
total of 38 wildcat exploration 
wells drilled hi 1998, just three 
small discoveries were made, 
yielding only 9m tnnnes . an. 
“unsatisfactory result”, says 
the Norwegian Petroleum 
Directorate, the industry 
watchdog, and far less th«n in 
the previous two years. 


Investment in the petroleum 
sector is forecast to fall dra- 
matically in two years from 
about NKreObn (£5.4bn) in 1993 
rvniflgfi new oil fields are dis- 
covered. 

The size of new discoveries is 
expected to diminish to an 
average 20m tonnes of oil 
equivalent, compared with 90m 
'tonnes for fjpMs now produc- 
ing 40m tfraraw for those now 
being developed. 

Blocks located, within the 
new acreage are to be offered 
for Tirgnca application by the 
ha gimring of next year, with 
award by the start of 1996. This 
timetable, says the govern- 
ment, could enable develop- 
ment . to commence by 2005 
with first production in 2010. 


Argentine farmers find stability hard to live with 

Hyper-inflation had offered opportunities for easy profits that have now disappeared 


E duardo Za valla, a big 
man in his mid fifties, 
looks every inch a 
farmer. Indeed he owns 1*200 
hectares of land, which pro- 
duces maize and barley as well 
as providing the grazing for a 
herd of dairy cows with an 
annual yield of about 2m litres 
and most of the feed for a herd 
of pigs. 

But these days be spends 
much of his Hma VjfAcm a way 
from the farm in an ornate 
office overlooking a pedestrian- 
ised shopping street in Buenos 
Aires. Far Mr Za valla is the 
president erf Sociedad Rural 
Argentina, the biggest Of the 
country’s four farmers' trade 
unions, and in these troubled 

times fay his memb ers thin is a 

fall time job. 

One of Us sons manages the 
farm mid ano ther , an econo- 
mist is his assistant in Buenos 
Aires. 

Ironically the problems being 
experienced by Argentine 
farmers result directly from 
the success their government 
is having in tackling t he coun- 
try's previous economic crisis. 
Only a few years ago Argen- 
tina had hyper-inflation run- 
ning at 500 to 600 per cent a , 
year. 

Several pampas farmers had 


FAIIMUrUVBEWPOiffT 



By David Richardson 


told days before my meeting 
with Mr Zavalia that they had 
learned to live, and even to 
prosper, in that economic envi- 
ronment. All they had to do 
was to avoid selling any of the 
mate*, soyabeans or beef cattle 
from, their fertile farms 
they needed- money and could 
maximise the value on the day. 
By combining that with delay- 
ing paying their bills for a 

mmtth of tOO they wwM wiaV» 

a lot of money. Some also man- 
aged to pay their bills in depre- 
ciating peso's while selling 
their produce for stable US dol- 
lars, some of which they 
promptly placed off-shore. 

But such volatility is not 
conducive to confidence in the 
long tenn future of an Industry 
■ml there was little Investment 


in new technology during 
those years. In consequence 
the machinery an most farms 
is old Mid unreliable and even 
now, though the countrys’ cur- 
rency has been stable since it 
was pegged to the US dollar on 
April 1, 1991 there is Insuffi- 
cient capital available to 
replace worn out equipment. 

In advance of the currency 
measures. President Menem’s 
Peronist a dminis tration bad 
increased wages and provided 
modest pensions for all, 
thereby increasing farm pro- 
duction costs. Meanwhile the 
value of fa*™ commodities an 
world markets had fallen, 
reducing income from exports; 
a wmihrnatinn of factors that 
has left many farmers in real 

fmanrial difficulties. 

Mr Zavalia points out that 
agriculture accounts for 
between two thirds and three 
quarters erf Argentina’s export 
earnings and claims it niwnW, 
therefore escape same of the 
strict monetary policies 
imposed on the rest of the 
economy. He does not accept 
that any. economic policy 

nhmilri fie Im pnwpH TtirKw nrfml. 

natdy across all industries and 
says he has asked the govern- 
ment to give aid to farmers to 
enable them to bring-their 


technology up to dote; to pro- 
vide advice to help them adjust 

tO Hw HOW riwmiwfainnM; anil 

to bring down interest rates on 
their borrowings, at present 
between 18 and 24 per cent. 

Predictably, Mr Felipe Sola. 
Argentina's secretary of agri- 
culture does not agree. “Dr 
Zavalia is not an economist, be 
is a trade unionist,” he says. 
And although the agriculture 
secretary accepts that some 
sectors of Argentina's agricul- 
ture are in trouble and that 
many th o us an ds of small farm- 
ers win go out of business, he 
argues: “Now fixed exchange 
rates are a certainty” most of 
the solutions are in the viable 
farmers' own hawifa. . 

The inertia fared' by 25 years 
of subsidised agriculture has 
led farmers to Look to govern- 
ment to solve all their prob- 
lems, he adds. What fanners 
need to do is to look to their 
own shortcomings in produc- 
tion, presentation and market- 
ing. That way they can atop 
imports of commodities that 
axe already produced some- 
where across the vast tracts of 
Argentina and also make it 
easier and more profitable to 
export to other countries. 

hi any case, he explains, if 
the government aids one sector 


it will be forced to aid all, and 
that could wreck a policy that 
has fad to growth in imfo 1 ™! 
o u tp ut of almost 9 per cent in 
each of the past two years. 

Behind Mr Zavalia' s 
attempts to achieve special 
concessions for his members 
there is rflaar acceptance that 
the changes brought about by 
the Menem administration 
were vitally necessary. “What 
we have to do,” he says, “is to 
loam to manage change.” 

1 cannot not help thinking 
that the problems of Argentine 
fanners are the potential prob- 
lems of British formers, writ 
large. The UK may not be a 
third world country straggling 
to join the first world; it may 
not have had such a volatile 
recent history. But British 
agriculture will shortly have to 
Suffer a gtraflar to that 

in Argentina when the Euro- 
pean Union’s guaranteed price 
sy s tem all but disappears. It 
will be faced with even staffer 
competition for domestic and 
export food markets and it too 
win need to rare its own short- 
comings to survive. 

As a British farmer I would 
be very wrong indeed to feel 
superior to my Argentine com- 
petitors. I am just more fortu- 
nate, for the time being. 


COMMODITIES PRICES 


CROSSWORD 


BASE METALS 


Precious Metals continued 


LONDON METAL EXCHANGE 

(Prices from AmaJgomalQd Metal Trodtag) 

■ ALUMMUM. 0*7 PURITY fS par tonne) 



Cash 

3 mth» 

Ckne 

12B&JS-SJ5 

1311-2 

Previous 

1292-3 

1314-6 

f-BgMow 1282J5/1292 

1316071304 

AM Official 

1292-2-5 

13140-15 

Kerb dose 


1300-10 

Open InL 

270715 


Total drily turnover 

34097 


■ ALUMMUM ALLOY (8 per tome) 

Ctom 

1142-5 

11820 

Prwtoua 

1150-5 

11706 

HgMow 


1162 

AM Olfldri 

1140-5 

11830 

K«t dose 


1165-7 

Open in* 

3,636 


Total doty toimw 

006 


■ LEAD (S per tome) 



0068 

4710-20 

4860 

Prevtoua 

4740-00 

488-9 

HgMow 


4927484 

AM Official 

47005 

490000 

Kerb dose 


4840 

Open InL 

3*834 


Total dafljr turnover 

8031 


■ NICKEL (S per tenno) 


Oooo 

5885-70 

5915-20 

Previous 

5880-70 

6920-5 

WrfVtow 

5870 

6935/5870 

AM Omdrt 

5865-70 

5920-25 

Kart) does 


5875-80 

Open U. 

51031 


Total daily turnover 

1*093 


■ TIN (Spar tonne) 



Ctoee 

5445-60 

64800 

Previous 

5470-80 

54906 

HgMow 

5475 

5625/5480 

AM Official 

5475-80 

350010 

Kart) dose 


. 547600 

Open M. 

20,133 


Total dolly turnover 

2088 


■ ZINC, apectai high grade (I per tonne) 

Ctoao 

947-9 

985-7 

Previous 

955005 

973-4 

HfaWtow 


972/966 

AM Official 

9500-10 

9680-9.0 

Kate dose 


988-9 

Open InL 

109051 


Total daly turnover 

12023 


■ COPPER, grads A (5 par tonne) 


Close 

1880-1 

1883004 

Previous 

1864-5 

18870 

tfigMow 

1860 

1692/1878 

AM Official 

1883004 

18880-7.0 

Kerb dose 


188808 

Open InL 

249,107 


Total (toy turnover 

39000 


■ LISE AM Official S7$ rate: 1.4870 

LME Closing £/t rate: 10870 


spun 4879 3 mini .4829 6MteM798 BnTfKl*7G8 

■ MGH GRADE COPPER {COMSQ 


Dtfa 


0pm 

Ctae ctonge 

KSgb tow 

tel Vri 

tor 8&30 +005 

6&JS OSJtS 

8050 5480 

to B8.4S +005 

8850 8620 

978 117 

toy 8SJH +005 

8740 8*20 32000 8.131 

Jm' 86-70 +080 

88.40 88.40 

8*3 18 

Jri 86-75 +075 

8745 86.40 

8407 588 

Mg 9005 +075 

- 

390 

Ittri 


82478 1*480 

PRECIOUS METALS 


■ LONDON BULLION MARKET 


(Prices euppied by N M RothactiW) 


Gold (Troy oz-) 

S price 

2 equlv. 

Close 3S10O-38Z0O 


opening 379.80-30020 



380.75 

230226 

Afternoon tlx 

38105 

256-971 

Day’s Hgll 382.0tKJ8S.4O 


Day's Low 37900-380.00 


Previous dose 37800-37800 



Loco Ldn Mean Odd LaadbiglWMfhUSS) 

1 month 3.10 6 months 326 

2 months 3.11 12 months 3.45 

3 i mn ttw — 3.15 


■ HOLD COM EX Cl 00 Troy oa.; $/froy <&-) 



sen 

prim 

nay's 

stage 

W 

0pm 
tor 1st 

m 

Her 

381.4 

+20 

. 

2 

1 

Apr 

3823 

+2.7 

3830 

3810 704*3 

18024 

Jm 

38*5 

+47 

3850 

3837 31434 

2059 

tog 

3880 

+27 

3870 

387.4 3.027 

12 

Oet 

3892 

+2.7 

3904 

3804 *184 

187 

Dm 

Trial 

391.7 

+27 

3824 

3912 13088 478 

147080 23,135 


■ PLATINUM NYMEX (60 Troy oz.; Srtroy 


AW 

387.7 

+44 

3374 

3354 1*198 

1.117 

Jri 

38*4 

+64 

3084 

3950 

3454 

253 

Oct 

398.7 

+64 

39*4 

3964 

913 

71 

Jm 

389.1 

+64 

3994 

3994 

460 

8 

Apr 

3994 

+47 

400.0 

4004 

237 

- 

Total 





1*460 

1047 

■ PALLADIUM NYMEX (100 Trey oz^ SAroy ozj 

tor 

138.10 

+048 

13840 

13525 

1442 

891 

Jna 

13740 

+048 

13740 

13940 

*278 

1454 

Sm 

136.78 

+046 

13740 136.75 

403 

170 

Dec 

13050 

+045 

- 

- 

151 

5 

lew 





5074 

2.120 

■ SEVBt OOMBC (100 Troy ozi CanJa/troy ozj 

tor 

5354 

+134 

5374 

52*5 18284 17057 

Apr 

5364 

+124 

- 

- 

1 

4 

Hay 

5394 

+124 

6390 

5294 59L221 

20085 

Jri 

5427 

+124 

64*0 

533.0 18422 

2428 

sw 

3*8.6 

+124 

548.0 

5354 

3.600 

98 

Doc 

5522 

+124 

6564 

54*0 

88ZS 

243 

Tetri 




114081 

41078 


ENERGY 

■ CBUM OB. NYMEX {42.000 US gats. 8/bcireQ 


Latest Bay’s Opss 

pries dongs Hgti las tt M 
Apr 1*68 +*11 1441 1 *£5 114£*1 47223 

Hay 1*85 +0.11 1438 14.79 5*25? 14.7M 

Jm 15m +008 15.13 1101 61,147 5058 

-M 1525 +012 1522 1021 2*201 1/11 

Mg 15.47 +014 1048 1043 1*018 1,259 

top 1188 +018 1188 1188 18,904 880 

TflM 4215a 77,014 


■ CRUDE OP tPE ff/bcml) 



latest 

Orfa 


0p« 



price 

ctonge 

Hum 

Um lot 

Vri 

Apr 

130B 

+0.11 

1348 

1303 72095 22038 

toy 

13.72 

+0.14 

1378 

1308 31054 

5040 

Jm 

1190 

+0.17 

1345 

1307 14020 

0010 

Jri 

1*04 

+0.12 

14.09 

1*03 9031 

073 

tog 

1*20 

+0.15 

1448 

1*20 4.753 

307 

Sap 

- 

- 

- 

- 2,65a 

131 

Tetri 




138050 31010 

■ KEATING 00. MY1EX (42000 US grite; PUS gtoj 


Latest 

Orfa 


UP* 



("to 

stage 

Hto 

tote tat 

Vri 

Mar 

5045 

+047 

5140 

5000 13046 20006 

Apr 

4575 

+002 

4040 

45^*5 4*437 10472 

toy 

4348 

+430 

4*46 

43©! 42063 

4.271 

Jm 

4345 

+0-27 

4*10 

4370 25,020 

2074 

Jri 

4405 

+002 

4*70 

4*05 1*777 

702 

Aug 

4525 

+047 

4540 

4505 8.701 

80 

Total 




182009 43011 

■ GAS OB. K (t/km) 




Sea 

Itayta 


Gpm 



price change 

ngo 

tori M 

Vri 

tor 

14050 

+140 

14100 14040 3*405 

5.182 

Apr 

14090 

+145 

14078 

13900 2*092 

2001 

toy 

13900 

+145 

14025 13050 13482 

eoo 

Jna 

14025 

+140 

14075 14O00 15,768 

785 

ri 

14220 

+140 

14225 

14200 10290 

179 

Aqg 

14*75 

+0.75 

- 

- 5068 

- 

Total 




1220SB 10088 

■ NATURAL QAS NYMEX (10400 imBBu SftnoBOL) 


toted 

Day* 


0 pm 



price 

BtaMga 


LOW tat 

M 

Apr 

2225 

■0487 

2410 

2405 3)037 

*809 

toy 

2.175 

-0.048 


2.165 12,141 

Ml 

Jps 

2.155 

■0431 

2.190 

Z145 9475 

582 

Jri 

1140 

-0031 

2.175 

2.135 9094 

438 

to 

2.156 

-0021 

2.173 

2 .i» tyaa 

323 


2L165 

-0434 

2.195 

2.165 10233 

297 

Total 




1180 m 

7088 


■ UNLEADED GASOLINE 
wvigxi^aauSiaBupuSBsasi 


Latest Day's Opss 

prim ctamga Hgfi tw tat W 


SharRi 
Spot 
3 months 
8 months 
1 year 
Gold Coins 

Krugerrand 

Maple Leaf 
New Sovereign 


p/taoy oz. 

US rta aquh. 

Mr 

4X70 

-048 

4*35 

4370 11083 

17072 

352.70 

82440 

Apr 

4540 

-005 

4645 

4500 39,158 

17037 

357.10 

52900 

toy 

4800 

+0.15 

4900 

4*50 39.485 

2047 

381.40 

63*10 

Jm 

4708 

+005 

4745 

4700 1*854 

2435 

36900 

64S.QS 

Jri 

4740 

+0.15 

4705 

4705 *485 

270 

S price 

C eqriv. 

Am 

47.10 

- 

4706 

<705 *837 

550 

382-385 

267-260 

Toni 




11*407 

41025 


391.6S494.10 

90-83 60-63 


SOFTS 

■ COCOA LCECC/tanm* 


GRAINS AND OIL SEEDS 

■ WHEAT LCE (E par tonne) 

Sait najl Own 

price donga Hgh Low M 

Mar 102.40 +1.40 10240 10100 251 

Miy 10420 +1-25 10*10 10300 2.148 

Jm 10*00 +195 10*00 10115 SB* 

S*p 9100 +0/6 - - 193 

NO* 9200 +005 8200 9225 921 

Jm 9425 +0.10 - - 372 

TaM 4032 

WHEAT CUT fiflOObu min; centeflXHb bushel) ■ COCOA CSCE flO tonnes; S/to ra re d ) 




Sad 

Upfa 


0pm 



M 


price i 


HW 

tote tat 

Vri 


S 

tor 

888 

-16 

096 

885 11072 2.155 

Apr 

247 

toi 

910 

-19 

919 

909 22007 3,170 

Jm 

117 

Jri 

922 

-13 

930 

921 1*433 

784 

Ato 

- 

Sap 

834 

-14 

940 

933 11449 

351 

Oct 

- 

Dm 

948 

-13 

956 

947 17038 

399 

Dao 


tor 

804 

-14 

90S 

866 23051 

149 

Frit 

408 

ToM 




11*849 7031 

ToM 


tor 

3484 

-7M 

348/0 

34010 25,736 28,120 

toy 

345/2 

-4/2 

348/D 

342/2 64030 24075 

Jri 

3354) 

-3/4 

3384) 

332 IS 89095 16046 

Sm 

337A) 

-3/4 

3380 

335/2 1*400 265 

Dec 

344/4 

-aw 

347/4 

342/8 1*380 325 

tor 

347/4 

-5/0 

- 

10 

ToM 




2I3PA 80,730 

■ MAKE CBT {6000 Hu min: centa/56fa buriwO 

Mte- 

285/4 

+1/2 

288/D 

283/810*410173010 

toy 

29345 

+2/D 

294/0 

2906626046138005 

Jot 

298/4 

+1/B 

296/8 

293/650*180 89030 

S»P 

281 /B 

+OW 

ZQtl 

2809)114035 *825 

Dm 

267/2 

-aw 

vm 

288/8281020 32,785 

tor 

273/2 

■ow 

Z75/D 

2734) 1*380 470 

ToM 




LB34B 47*320 

■ HARLEY USE P par tonne} 


Mar 

10*65 

+000 10*75 10*75 215 58 

May 

10525 

+050 

10500 

10500 189 S3 

8 ep 

92-50 

+000 

- 

- 118 

Mot 

9*80 

-100 


SB 

Jm 

95.75 

-000 

- 

3 

to i 

9705 

-025 

- 

- - - 

Ittri 




984 M 

■ SOYABEANS CBT (5000X1 mine exBtaTOfc tertMO 

tear 

877/2 

-3/4 

6800 

S7SW 86085 8*070 

toy 

68343 

-3/2 

688 /B 

68V2 300,495 143045 

Jri 

68 B/B 

-2/B 

688 W 

684W2Z3075 43025 

a*o 

8781* 

-M 

6834) 

670/4 3*555 2050 

Sap 

683/0 

-241 

88 710 

BB2/D 1*320 1040 

Not 

HEIW 

-1/2 

E&4fi> 

848/8122030 17,135 

Trial 




80(050 293086 

■ SOYABEAN OS. CBT (BO0OOte cantsfe) 


MEAT AND LIVESTOCK 

■ LIVE CATTLE CME (4q.000fce; cantata) 

Salt Bay's 0pm 

price ctmto* Bp* Lew M M 

77.100 +0.150 77.180 78.750 37006 10031 
7*975 -0028 71075 74050 21,175 4064 
78028 -0.175 73050 73075 12037 1,438 
73025 -0125 72060 73000 0036 728 

74050 -0075 7*100 71828 2007 98 

71750 +0100 73/50 73.750 811 80 

■4JBB 17,185 

LIVE HOPS C*g (4O0OOfca; canteta) 


No.8,392 Set by PROTEUS 


1132 

-16 

1130 

112S 

9 a 

340 

Apr 

<0000 -0075 4*300 4*300 14,480 

1063 

1138 

-13 

1147 

1138 3*484 *708 

Jm 

5*950 -U22S 55075 5*626 

8084 

788 

1105 

-10 

1170 

1181 

1*334 1000 

JM 

5*250 -0000 5*400 54025 

3081 

180 

1189 

-10 

1183 

1185 

7040 

321 

amb 

5*800 +*125 82000 52400 

2006 

80 

1217 

-12 

1225 

1218 

*483 

404 

Oct 

48000 +*200 48000 4*300 

1067 

13 

1248 

-13 

185 

1253 

9056 

188 

Doc 

4*560 +0460 481800 48050 

1007 

17 





87014 80M 

TOM 


31089 

2088 


toe 

M 

top 


ISM 

■ COCOA QCCCfr {BOFTa/tanne) 


F* 25 
Daly 


Fries 

.92220 


Fab 28 

today arenas 90024 

■ COFFEE LCE (8/lonna) 


Plw. day 
82207 


891GB 


Iter 

1183 

-25 

1215 

1190 

2027 1,443 

tor 

1213 

*22 

1231 

1208 15.796 2077 

Jri 

1218 

-15 

1230 

1210 

*018 978 

ta 

1219 

-14 

1229 

1218 

3071 32 

Hot 

1221 

-17 

1232 

1217 

*417 122 

Jm 

1219 

-14 

1229 

1215 

4055 38 

TOM 





87009 9081 

■ COFFEE •O’ CSCE £37000*30; cente/ba) 

Mar 

7*80 

-105 

7500 

7*10 

1,194 185 

■fay 

7*40 

-148 

7700 

7*05 30087 5024 

Jri 

7700 

-U0 

7805 

7700 

7,198 671 

«*P 

7903 

-100 

8*10 

7*00 

4072 127 

Doc 

8050 

-1.10 

0140 

8025 

3078 226 

MOT 

0100 

-005 

8240 

8100 

1023 28 

TOM 





47016 8008 

■ COFFEE (ICO) (US centsfcouid) 


F* 25 



Price 


PPM. day 

OmiLtar 



-7301 


7103 

15 dwawnga — 


.7208 


72J3 


Mr 

2*05 

-004 

2800 

2*64 12,725 

9059 

■ No7 pnomUM RAW SUOAR LCE fcsntsflbal 

toy 

2*92 

-*04 

2900 

2*74 3*237 1*761 








Jri 

2*90 

-*03 

2806 

2*72 2*994 

*021 

Mar 

1108 

+004 

1104 

1105 

804 

133 

Am 

2*46 

+002 

2800 

2805 0029 

786 

toy 

1108 

+*13 

1200 

1100 

1487 

55 

Sap 

2709 

+*10 

2700 

27 JD 6002 

883 

Jri 

1245 

+*18 

1207 


2042 

105 

Del 

2*95 

+*11 

2700 

2*80 5023 

270 

Out 

1103 

+*14 

- 

- 

135 

- 

Trial 




108055 32004 

1PM 





258 

298 


■ SOYABEAN MEAL Cgr POP tore; SAorQ 


■ WHT1E SUGAR LCE (S/tonna) 


Mar 

1920 

-1.1 

19*0 

182.8 

MIT 14070 

Mr 

32*40 

+*60 32*80 3Z1.00 

7088 1,132 

toy 

1934 

-10 

19*9 

1330 30062 

1*723 

Arn 

32100 

+300 32200 31*50 

3,443 

704 

Jri 

19*0 

-10 

18*3 

1935 23482 

*701 

Oct 

30200 

+200 30*00 30100 

3011 

214 

Aag 

1920 

-IS 

1944 

192.7 

6087 

959 

OK 


+*38 29900 28800 

118 

11 

ta 

1910 

•10 

1930 

1910 

*142 

331 

tor 

29700 

+1.10 29*50 28*00 

285 

64 

Oct 

1900 

-10 

192.1 

1900 

2081 

352 

tor 

28*10 

+040 29940 29700 

191 

4 

ToM 





87018 34011 

Tetri 



18038 2,138 

■ POTATOES LCE (C/tonne) 




■ SUGAR If CSCE (1120OOtas; cantata) 



1500 

+100 

1550 

1500 

38 

5 

Mb- 

1148 

+*32 

1100 

11.10 3088 4084 

12*5 

«*7 

1260 

12*0 

1055 

247 

toy 

1100 

+*17 

1102 

1102 0204211.439 

14*3 

+90 

14*0 

13*5 

950 

117 

Jri 

1108 

+0.19 

1109 

1108 2*431 2463 

1300 

. 

. 

. 

2 


Hot 

1104 

+*11 

- 

1147 21018 *218 

filLO 


_ 

_ 



Mar 

1149 

+0.14 

1100 

1107 *783 397 

1010 

“ 

- 

- 

»,tm 

400 

»y 

1PM 

1148 

+*10 

11.38 

1108 942 Z7B 

12*88822083 


■ FREIGHT (BffFBQ LCE fOWndaw point) 


Mar 

1144 

+12 

1145 

1138 

132 

11 

Apr 

1209 

+17 

1206 

1190 

341 

21 

JU 

1100 

+11 

1096 

1088 

108* 

5 

Oct 

1250 

+2 

- 

- 

583 

- 

Jm 

nm 

-13 

- 

- 

243 

. 

Hr 

1350 

- 

- 

- 

74 

- 

TPM 

Oom 

Pim 



9fQ3 

37 

BR 

1117 

1117 






The Tea Broker's Association report* landed 
ray abong demand. Bright East Mricana sold 
we» end often a ppre cia ted several pence. Coi- 
aury meeflun teas met keen comp e ti tio n and 
prices advanced 5 to 16p end sometimes 
more. Plainer descriptions were Am to dearer. 
Brighter caylons gained ijj to I5p. others 
moved 2 to 4p rug her. Onshore strong 
demand. Brighter teas were 4 to 8p de ar er 
•due plainer types re ma ined My firm. Qurity 
I95p/hg ram. good msdhan 145p/kg. median 
125p/kg. low medium 860/kg. The highest 
price realised thta week was 21Sp tor a 
Rwanda otl. 


■ COTTOM NVC6 ggjjgtog cantata 

tor 7900 +018 7903 7115 1088 288 

Hay 7928 +021 7135 7156 21238 8029 

Jri 7072 +027 7080 7805 11,737 2003 

Oct 7504 +002 75.15 7*95 2041 817 

DSC 7229 +001 7205 7215 10048 1.189 

Mar 7300 -005 7300 7298 328 1 

Total 04441*807 

■ ORANGE JiaCENVCE f!50OOfce; cantata) 

tor 10*30 +020 -10140 10305 2.738 1,782 

HW 10705 +040 10800 10800 7028 1,117 

Jri 11040 +030 11100 11000 *133 750 

top 11250 -010 11300 11200 1003 18 

tor 11300 -080 113.75 11300 1,107 20 

Jm 11196 -005 11505 11140 1097 70 

Trial 18050 1775 


VOLUME DATA 

Open Interest end Volume dels shown tor 
contorts traded on COM EX. NYMEX, CUT. 
NYCE, CME. CSCE aid (PE Crude 09 era one 
(to In ; 


INDICES 

■ HEWERS (Base: iaW31-100) 

tote 28 ft* 35 month ago jre*r ago 
17920- 17 BSj 4 17280 17720 

■ CRB Futures (Base: VB/SfelOO) 

tote 28 tote 24 bmoBi ego year ego' 
227.46 22808 22S0O 20201 


■ PORK BELLIES CME (4O0OOtoit: cental 

tor 50000 +0928 87000 85000 1002 678 

toy 57025 +0500 81100 50000 5003 1038 

JM 98078 +0750 5&4S0 51700 2084 244 

tog 55000 +0875 55000 84075 4GB 17 

M 99025 0100 88028 81750 15 8 

tor 80000 +0750 60000 1 1 

7SM 90S 2081 

LONDON TRADED OPTIONS 

Strike price S tome — Cals— — Pula— - 

■ ALUMMUM 


(99.754) LME 

Apr 

Jri 

ta 

Jri 

1275 

61 

62 

21 

37 

1300 

37 

68 

32 

48 

1825 

20 

58 

48 

00 

■ COPPER 





(fends A) LME 

Apr 

Jri 

ta 

Jri 

1850 

00 

96 

29 

48 

1800 

34 

69 

63 

69 

1960 

18 

48 

86 

97 

• COFFEE USE 


Jri 

\*at 

Jri 

1200 

48 

74 

36 

86 

1250 

28 

62 

85 

84 

1300 

IS 

36 

102 

118 

■ COCOA LCE 

Mqr 

Jri 

May 

Jri 

800 

39 

82 

28 

40 

926 

28 

49 

43 

52 

950 

IB 

89 

SB 

87 

■ BRENT CRUDE IPE 

Apr 

May 

Apr 

Msy 

1300 

72 

. 

10 

28 

1350 

31 


27 

- 

1400 

12 

47 

51 

- 


LONDON SPOT MARKETS 

■ CRUDE OB. FOB (per bernVApi) -tor 


Dubai 

S1208-2.73OT 

+*106 

Brant Blend (dated) 

SI 303-308 

+*22 

Brent Blend (ApO 

SI 304-306 

+*105 

W.TJ. (1pm eat) 

SM07-408 

+*115 

■ OIL PRODUCTS NWEprampt dalvery OF (tonne) 

Premium Gaaalne 

SI 64-156 


GesOB 

SI 45-147 

+20 

Heavy Fuel CM 

$81-83 


rtapnma 

SI 35-1 37 

+10 

Jet Fuel 

Si 69-160 

+10 

fttaPQam Argm nntmteu 



■ OTHER 



Gold (per troy tuft 

$38100 

+3.1 

Saver bw any o4* 

BW C- 

+100 

Ptatewn (par troy azj 

S394-6G 

+306 

ReBedum frier troy oz.) 

SI 3* 75 

-10 

Copper (US pradj 

92.00c 


Lead (US prod) 

3*00o 


Tin (Kuala Lumpu) 

1408r 

-002 

Tin £N«w YotK) . 

25404k) 


Zinc (US Prime wj 

Unq. 


Crttto pro walflhgt 

12*85p 

+005- 

Sheep 8h« nrtghor* 

11&57P 

-205* 

Rg* to» wrighi) 

7S06p 

+45.77* 

Len. day nger fraw) 

828*60 

-00 

Lon. day sugar (wtc) 

S329.10 

+50 

Tate * U4e export 

$301 00 

-00 

Botay (png- tee* 

Unq 


Mab» (US No3 YeBra) 

El 430 


Wheat (US Dark North) 

Cl 29.0 


Rubber (ApOV 

8*75p 


Rrt*ar(May)V 

O50Op 


Rubboc^L RSS Nol Feb) 

24000m 

+100 

Coconut CD <PN9§ 

S5570X. 

-20 

Petal 08 C taryJS 

S3720t 


Copra (PhRS 

8305.0 


Soyabaano (LR? 

£200.0 

-1 

Codon Outlook A tadax 

8200c 


Woottops(B4»SupM) 

373p 



« Brin msM dON. 4 ShMP 8JM writfs 

Chang* on weak. prarUoML prices. 


w Hr. i Me. 



DOWN 

2 Plant producing exaggerated 
feeling of well-being in lead- 
ing botanist (9) 

8 Flower some find useful (5) 

4 Charlady requiring regular 
assistance (5,4) 

5 One of those ancient prophets 
(5) 

6 Express sound views as dis- 
cussions seen to falter (<L5) 

7 Mother the night before see- 
ing legendary queer (5) 

8 Pay in full if stays St? (7) 

9 Yonder church with the straw 
roof (6) 

15 Happen to occupy position 

<4£> 

17 He gets something out of old 
farm vehicle (9) 

18 Feature column meant to 
divert (9) 

19 Tribe disturbed by army 
headgear CO 

31 Musical prelade to admit- 
tance (6) 

23 Muscular spasm keeping run- 
ner quirt (6) 

24 Creature reluctant to follow 
scout-leader (5) 

-26 Animal's saintly hnnm (g) 


Solution to Saturday's prize puzzle on Saturday March 12. 
Solution to yesterday’s prize puzzle on Monday March 14. 


ACROSS 

1 Descriptive of old-fashioned 
husband at breakfast? (6A5) 

10 Some trashy pedlar given 
excessive publicity (5) 

11 Rude about head valet being 
bankrupt (9) 

12 Fare group find revolutionary 
(7) 

18 Gathering of sailors at church 
an board ship (7) 

14 Clothing worn by custom (5) 

16 Tree planted on lot in New 
York to last indefinitely (9) 

19 Bans drug, causing trouble 
for Rose? (5,4) 

20 Wise bird swallows one (5) 

22 Culinary instructions to mafro 
about a hundred pies? CO 

26 What trouble and akOl needed 
to get across] (7) 

27 Dash around at meaL (Butler 
not in?) (4,5) 

28 Part of a gun (5) 

29 Sweet fruitghi(5£) 


JOTTER PAD 







( >Ut 


SWORD 

K SI 




‘Vi 


V, 


. • J 


II 


FWANCIAJL TIMES TUESnAV MARCH 1 1994. 


31 


LONDON STOCK EXCHANGE 


MARKET REPORT 


FT-SE-A All-Share index 


Strong advance backed by trading programmes 


Eipdty Sham Traded 

Turnover by vokm (mfflon). Eachdng: 
Mxa-mariuM buttiess and avensoa turnover 
1500 - " 


By Tarry Bytand, 

IRC Stock Market Editor 

Favourable developments on the 
global interest rate front, backed up 
by strong rises in UK government 
securities, drove UK equities ahead 

yesterday in what was almost a mir- 
ror image of last Thursday’s set 
back. Encouraged by buoyancy in 
New York, London closed at the 
best of the day, and trading volume 
picked up after a drab start 
The stock market continued to 
concentrate on its own concerns 
which encompassed bond yields and 
interest rate prospects, and largely 
ignored wider issues including the 
downing of four Bosnian aircraft 
by UN forces. Reports from the 
meeting of G7 finan ce ministers 
indicated renewed pressure to 
stimulate global economies. 


Tbs final reading for the opening 
session of the new trading anrw imt 
showed the FT-SE 100 Index 4&9 
ahead at 3528.1. Share prices were 
in positive form throughout the ses- 
sion, following a bond market 
encouraged first by news that the 
Bundesbank had made a variable 
repo offer, which was interpreted as 
a sod towards lower interest rates, 
and then by comments from a gov- 
ernor of the US Federal Reserve 
that the board's recent modest 
tightening of policy might prove 
sufficient to ward Off inflationar y 
pressures. 

Both moves strengthened the 
growing hopes in London that last 
week’s sudden alarm over interest 
rates had been wildly overdone. 
Traders saw some genuine buying 
interest, including a strong buying 
programme among the engineering 


Apcouwt DenJlng Dates 

■ft* PataiQl 

Fab U 

AO 23 

tar 14 

OMonMatana 
fob 24 

Matt 

Ms 24 

Laat Daatkiga: 

Feb 36 

Mar 11 

Mar 26 

Amnogr. 

Mar 7 

tar 2 ! 

Apr 3 

Haw tkm riaarings nay t aka 
butanaa tata tartar. 

1 

1 

1 


and oil stocks from a leading over- 
seas-based securities bouse. At least 
one other trading programme 
appeared to cross the trading 
screens as the market began to 
gather confidence. 

The improvement spread across 
fire range of the market, lilting the 
FT-SE Mid 250 Index by 40.1 to 3560. 
Trading volume was slow to dev- 
elop until the trading programmes 
made their appearance. By the 


dose, S eaq volume totalled 705.7m 
shares, against 792m on Friday 
when retail, or customer, business 
returned a money value of £l_68hn. 
Selling pressure was relatively ligh t 
during last week's shakeout in the 
stock market 

Share gains ranged through the 
retail and consumer sectors, which 
are immediate beneficiaries from a 
more relaxed interest rate environ- 
ment, to the financial sectors, 
which had Men so sharply during 
the market setback. Notably lagging 
the market were the big pharmaceu- 
tical groups, which have underpea*- 
fonned for several months and con- 
tinue to fail to hold the confidence 
of the big International Investment 
funds that were once strong sup- 
porters of the sector. 

Hongkong and Shanghai Banking 
responded strongly at first to the 


excellent dividend and profits news, 
but the shares cooled off before the 
close. The hanking sector showed 
some disappointment last week 
with trading results from National 
Westminster Bank, raising some 
concern among market strategists 
lest the widely anticipated improve- 
ment in corporate profits should fail 
to boost the stock market. 

In spite of yesterday’s improve- 
ments in European bond markets, 
investors remained nervous regard- 
ing the near term outlook- Some 
have suggested that the UK stock 
market will now switch from being 
"Interest-rate driven to being corpo- 
rate-result driven”. 

The next fortnight will bring prof- 
its statements from companies rep- 
resenting around one-third of the 
market capitalisation of the London 
stock market. 



Dac 

sanK^romta 93 

■ Key Indicators 
Indices and ratios 


FT-SE 100 

3328.1 

+4&9 

FT Ordinary Index 

2564.1 

FT-SE Mid 250 

396a0 

440.1 

FT-SE-A Non Fins p/e 

22.51 

FT-SE-A 350 

1B84.B 

+222 

FT-SE lOOFut Mar 

3319.0 

FT-SE-A AD-Share 

1675.49 

20.82 

10 yr Gift yield 

692 

FT-SE-A Aft-Share yield 

3.43 

(3.44) 

Long gilt/equity ytd ratio: 

2.14 

Bftit performing sactore 


Worst performing doctors 

1 Exvacttve Inds 

_ _ 

.... +2.9 

1 Other Financial 



R o toil er s , Food 
Tetecommunicattons .... 
Properly 


Bactridty 


... + 2.6 
.. + 22 . 
... + 2.1 
... +15 


+26.2 

P2.24) 

+51.0 

(7.01) 

P-17) 


.....-05 

Other Sendees & Bsns ...+0.2 

Merchant Banks +0.2 

FT-SE SmaSCap ex JT +05 

FT-SE SmaSCap +05 


Granada 
stock 
sold off 

The first of toe expected bouts 
of selling of Granada shares 
following Friday’s successful 
bid for LWT was said to have 
come from Warburg Pincus, 
the US venture capital group 
which had been a firm sup- 
porter of the London broad- 
caster. 

Dealers had initially thought 
that the sellers might be LWT 
directors, who have a com- 


bined stake of zo per cent in 
LWT and are widely expected 
to be among those seeking to 
sell their new Granada shares. 
Some 112m have been issued as 
part of the £760m takeover. 
The US group was not return- 
ing' calls yesterday. 

Dealers said a number of 
institutions which are holders 
of both stocks and are now 
overweight in the combined 
group are also likely to be 
restructuring their portfolios, 
adding to the selling pressure. 

There was some confusion 
over the size of toe Warburg 
Pincus stake, with market 
sources putting the number of 
shares at 9.4m, while the Seaq 
ticker registered twice that 


amount being bought at 543p, 
with large trades going 
through toe other side at 548p. 

Dealers said that Cazenove 
and Hoare Govett had placed 
the stock, although it was 
unclear as to whether all the 
shares had been successfully 
sold. Granada fell 7 to 552p, 
with turnover reaching 32m. 

HSBC off the top 

Top-of-tb e-range preliminary 
profits and a higher than 
expe cted dividend total from 
HSBC drove the bank's shares 
sharply higher during the 
morning before a rethink by 
analysts saw the shares drop 
back tO dose only TwnrffhmVIy 


EQUITY FUTURES AND OPTIONS TRADING 


higher on balance. 

Marketmakers acknowledged 
the excellent results - “you 
could not really have asked for 
much more, especially on the 
23 per cent hike in the divi- 
dend,” said one - but added 
that the market had been 
reluctant to push toe shares up 
any further. 

They said international insti- 
tutions bad been big buyers of 
HSBC over the past IS months 
and would need some convinc- 
ing reasons for increasing 
we ightings any further. 

Bank specialists were also 
said to have been sli ghtly dis- 
appointed with HSBC's Hang 
Seng Bank results and worried 
by margin erosion. “There is a 


TRADING VOLUME 


Active buying returned to 
stock Index futures 
yesterday, encouraged by 
a more favourable outlook 
on Interest rates, a firm Wan 


Street and a positive mood 
in UK gilts, writes Joel 
Kbazo. 

The opening trade In the 
March contract on the FT-SE 


■ FT-SE 100 MDEX RfTURES QJFFQ E2S par U (ndme polra 


(APT) 



C*ran 

Sett price 

Chaige 

Hgb 

Lour 

Ear. ie 1 

Open W. 

Mar 

3282.0 

331 SjO 

+51.0 

33270 

32820 

12657 

60885 

Jun 

33100 

3332.5 

+524) 

33320 

33035 

1425 

14163 

Sop 


3353.0 

+520 



0 

440 

■ FT-SE MO 280 MDEX FUTURES (UFFQ £10 per ful index pobn 



Mar 

3945.0 

3984.0 

+36.5 

3972.0 

30420 

282 

179 


■ FT-SE MD 2B0 MDEX FUTURES (OMLX) £10 par fid Indat paint 


39400 


+300 3966.0 39400 


20 


2X21 


I ro 


3966.0 

Jin 3977.6 

AM span M wi agues ara far printout day. t Scact MtKB ahomn. 

■ FT-8E 100 BTOEX OPTION (UFFE) (*3322) £10 per tufl Index point 

3150 3200 3250 3300 3360 3400 3450 3500 

CPCPCPCPCPCPCPCP 
Mar 179% 11 138 IS 99 28 03% 45 39 70fe 21 J0*fc 11 146 5 167*2 

A|r 196 28 ISBh 41 123 55*2 94 Tft « 100 « 130 X> 165 26 20Z»j 

Me 220*2 46*2 184*2 60 UfeTfe 121 OSh 04 119 7Zh 148 SZfc 17102 afe 215 
JUI 233fe 58>2 JS7 TI^MSh 80 136*2 HO WfeflBfe » 162 GO 190% 61 226 
Deef 0712 127 2W 164 167^213 122h 268 

Cdk 6,770 PM *j631 ‘ ~ 

■ EURO STYLE FT-SE 100 MDEX OPTtOW gJFFE) CIO par fJ frdax po*Tt 

3125 3175 3225 3275 3325 3375 3425 347S 

202h tS7k 14h 117% 24*2 Bh 36h SZh 31% 67% B 164 

*r 21ft 24 W 2 34 149 47 187^ 64^ Ttfg 86 57 113 39 144h»h 161 

May 238*2 39>2 157 66*2 107b 106 62 158^ 

in 262 4ft- in 78 129 119b 82 173% 

Sent 292 70*2 225 101 167b 141 

Cali 1,583 M» 454 - Underlying btanhi tasAm man m band on tatfenart prices. 

flag n*7a«*» 

■ EURO STYLE FT-SE — > 250 MPEX OPTION (OMLX) £10 pwlUl Mdax point 

3060 4000 4050 4100 4150 4200 4260 4300 

MW 63 47*2 38h 71% 22 107 12 1464 F* 190 2h 237 1^ 1 1 

Kr 99 TB 1 * 74^ 100 58*2130*2 38 IBS 27 18 11 7 

Mi 34 RMr 114 Seaton** prfcw and rtm aw Mae at 43U*s 


100 was struck at a firm 
3,282 and the contract 
moved steadily forward, with 
most of the early demand 
coming from US houses such 
as Salomon Brothers and 
Goldman Sachs. US houses 
were among lest week's big 
sellers. 

A firm Wall Street boosted 
demand in the afternoon and 
March reached a peak of 
3,323, before coming off toe 
top to finish at 3,319, a 
3-polnt discount to cash. 
Volume was a reduced 
12,657 tots. 

In toe new FT-SE Mid 250 
futures contract, March 
closed at 3.332.5 on 
Improved volume of 1,425 
contracts, against last 
Friday’s debut turnover of 
617 tots. On the rival OMLX, 
a mere 29 deals were - - 
registered in toe same 
contract as ft ended at 3,960. 

In traded options, total 
volume came to 32,212 
contracts, of which 10,644 
were dealt In the FT-SE 100 
option and 2,014 In the Euro 
FT-SE 100 option. Lasmo 
was the most active stock 
option with 2,534 tots traded, 
followed by Blue Circle with 
1,525 and Lonrho at 1,467. 


AaMaoiet 

ABtay mmoreft 
Afean ntrn 


SSttSt f 


Ooakig Dura 
prica 



aScieitt 


art Aeroapacsff 

nuuwpt 
BrlMti out 

MM land 

Bum 

Buim c m u t 

Buttxi 

CaUelMmt 
CartuySctaeppact 
Cuter aw 
Coratart 
Carter Curam-t 

cooav ii wt 

Conan. Untotf 


Cocraukfat 
CWaaiy 
Da La Rue 
□tana 


473 +14 

506 *h 

332 *1 

409 «e 

947 +124| 

208 44 

BOB +S1| 

207 -7 

502 411 

470 40 

BSD 4ft 

2i*h +*h 


EngCNna 


sr 


Bonuoal Unha 

FW 


FT - SE Actuaries Share Indices 


The UK Series 


Fowl & CoL LT. 
Fcn&T 

Ovl /4cc*uom+ 
Gwwml Bwtf 
Glwot 

2ES*. 


OfB 

Fob 28 chQoH Feb 28 Feb 24 Fab 23 


ago 


'FT-SE 100 3328.1 

FT-SE Md 250 306aO 

FT-SE MM 290 ex Imr Trusts 3972-9 

FT-SE-A3S0 1664X 

FT-SE SmrtCap 2043S9 

FT-SE StaftKop ax few TfUBta 2022.63 

FT-SE-A ALL-SHARE 1B7&49 


+1/4 3281.2 3267 J 3341.9 2882.6 

♦IX 3B19.9 3923.0 3874.9 3049.7 

+19 3932a 3937a 39673 30547 

+13 1882-8 18573 16913 14213 

♦03 2039.34 2048.77 2084.18 1630.12 
+02 201835 202738 20423S 1538141 
+13 1854.67 1650.46 168233 1403.48 


■ FT-SE Actuaries All-Share 


Day's Year 

Feto 28 crigett Fab 25 Fab 24 Feb 23 ago 



fVE XU acf. Total 
ratio ytd Return 


10 MNBML EXTRACnONflfll 

12 ExoacAm IndMaWwH) 

15 OU. WogratedCT 

16 Oil Bcotanttfan 8 ProdfUl 


2598.63 

+12 2851.13 253289 2581.17 2081.40 

a<s 

431 

2071 

420 

101210 

3630J1 

+293818.11 3794.52 382035 317020 

217 

4j66 

a.44 

ore 

1057.73 

2509.48 

+1.1 3481.76 2402.65 2831.45 1947.70 

3.60 

4J6 

25.19 

Bl35 

100031 

1880.71 

+1^ 1851.14 184522 1885.71 2023.10 

aia 

322 

3365 

0.00 

1066.45 


Jctnocn Uachev 

tanmirf 
Kara Save 
L«fcre4gst 
Land Saatanrt 
Upon* 

LogaJ 4 Ganenft 


20 GEN MANUFACTURS«pB4) 

21 BiAfrO & ConatrucUonpi) 

22 Bulking M*te ft Merahs(30) 

23 ChwrtcaWZO) 

24 Dhwsffied tnduatrtato(TBl 

25 Qoctrortc ft Beet EquIptiO 

26 EngMa«ring{7a 

27 EnflinMring< VoOtoMflSJ 

28 Printing, Paper ft P«* gP7) 

29 Tea toi ft Aopwelp2) 


2156.73 

♦1.0 213020 213424 2168.15 171330 

242 

275 

34. BO 

459 

1066.61 

LardonBacL 

Lonriio 

497 

5.700 

103* 

162131 

+1.4 1500^4 1507.66 1528-88 91250 

233 

1 32 

80.00f 

218 

116552 

Ucaa 

2.100 

BO 

2270; 68 

♦1.1 224019 2247.68 228013 1507.20 

210 

2 23 

54.43 

1.14 

104040 




242247 

+12 2393.03 2991 21 241287 2157.50 

281 

4.70 

2602 

052 

1041.10 

Mananta 

84 

788 

2119.66 

+0.921004)5 208523 211038 188680 

4.19 

4^1 

30 28 

1094 

105322 

Martaftftpantat 

2000 


213036 

+0^ 211275 213066 2179^4 180900 

246 

5.71 

21 22 

228 

101291 




196759 

+OJ 1951.87 1945J8 1962^7 14324M 

279 

285 

4001 

456 

110055 

MPCt 

2.CQ0 

3M1, 

239287 

+02 238021 240061 2441-06 160000 

4^5 

223 

4231 

029 

1124re 

IkOWul Barter. 

5AMO 

SOI 

3018.90 

+08 2895/42 298030 302007 229360 

2B9 

4.10 

2953 

ire 

1169.88 




1956.42 

+1.7 192563 1921^ 195638 1883.10 

234 

509 

2459 

122 

1079.14 

Nortn Itaai WBterf 

477 

558 


30 OON3UMB1 QOOOS03} 2931 28 

31 Brewaries(in 229333 

32 Spfctts. VWnm ft CkteraOO) 3164.16 

33 Food ManufcctUWSC3J 243727 

34 HouaahoM Oood8t12) 2689-72 

36 HeMtfi Cara<20) 184633 

37 PharmaceuttcelBtlO) 3114.38 

38 Tobacco(1> 40 3 5 - 1 ^ - 


+0.82804382878.11 2917.09 290530 
+13 2257.01 222631 2247.91 212040 
+1.6 311434 3050.20 3085.11 2861.70 
+13 240631 239037 244051 2475/40 
+0.6 287333 287238 288531 243130 
+03 183838 183738 1857.09 18JM30 
+03 S10S.S5 3064.77 313336 329720 
+0.6 400938 3976.43 402237 403830 


aa2 

070 

17.00 

1247 

9604)4 

207 

7A8 

1243 

OB4 

1004.74 

236 

579 

2016 

1283 

losere 

286 

291 

17.14 

295 

99231 

297 

235 

1224 

ore 

100218 

peg 

216 

2215 

1/48 

104626 

4.12 

271 

17.45 24.70 

98516 

«2B 

729 

14.78 

OOO 

B6202 


MortwnBact . 

ttxrtam Foodot 


PfeOt 


P oarwGont 

PrttasUf 


RI3I 


881 
MSB 230 
BB3 668 


1300 

3J00 

534 

2300 

283 

1300 


104 

581 


B4S 

853 


+10 

«e 

♦ft 

♦a 

♦ft 

+a 

+7 

-1«1 

♦15 

♦2 

»10 

♦31 


40 S£nWCES(219) 

41 aaributorspi) 

42 Leisure ft Ho*aJs<22 ) 

43 Medaf3f9 

44 Rwsflere. FoodflT) 

45 Beiaflero. GeneraX43) 

48 Support S«vle«f4a) 

49 TrwisportflG) _ 

51 OlhW Sarmces ft BuanassQgL 


211337 +13 2085.93 208039 21 153S 1790^0 
312324 +0.7 3102.16 310430 314S.17 2546.10 

231239 +a5 230034 228038 2335.16 176030 

328233 +1.0 323043 324094 3267.07 2220.40 

162934 +23 158834 1553S3 1587.14 206630 
1776.63 +1.7 1747.77 1747.70 177676 146600 

177017 +07 1757.90 1763.98 178031 156330 
2649.06 +1-5 261086 2822/45 266634 2074.00 
1«P31 +02 132047 132075 133931 133090 _ 


282 

533 

9990 

4.12 

101555 

289 

422 

25-06 

1.48 

105588 

246 

4.92 

24.41 

lire 

112037 

ire 

sre 

2928 

4 re 

1111* 

279 

9.80 

1206 

ire 

94625 

288 

522 

24.06 

4.18 

929.44 

222 

545 

17.73 

1.18 

105574 

218 

242 

3291 

218 

101500 

269 

227 

4216 

072 

111219 


ttaf 

BSC 


550 1091 


IW-t 


60 1/nUTTESfWl 
62 Etectrictiy<l7} 

84 Gas DtetrtDtrtonO 

66 TetecorpmunleMlonsfl/ 

66 Wetatta 


2537.35 +132491.562517.17 2574352104.00 

2432.77 +1.9 2388.42 2396.19 2439.46 1657.70 

2148.48 +13211838218098225231 198730 

2239.46 +22 2190BB 220938 2264.40 1967.60 

1941 BB +08 1926.19 194338 200010 1748.40, 


294 

587 

1796 

500 

94287 

240 

1017 

1208 

1585 

M»-SW 

557 

* 

t 

ore 

94928 

2S3 

541 

225S 

ore 

93099 

4.76 

1209 

are 

248 

93422 


tJcrirouoorr 
Scotnoh 4 Now. t 
8coL Hydro-Sort. 


Sadfftak 


BB NON-F»IAWCl*LSt63tg 


1791 09 +13 17B03217683B 1797.081S4Q68 3.48_ SA4 2231 4.67, 12M32. 


70 FWANCIAUS110I9 

71 BanksflO) 

73 MBuranoxm 
7« Ltte Assurancelfl) 
75 Mschant BankntO) 
77 Other FMandaipS) 
79 Propertyfm 


2499.41 +1/4 2484.12 2451.13 252&90 1863.70 

3245.48 +1 .7 319034 3184.68 330097 229930 
1432.03 +13 1414.17 1383.46 1417.47 1323.60 

201938 +08 2804.70 258439 2623.95 248830 

3277.57 +O2 327137 3288383346.78 222690 

2081*6 -0.2 2088.40 2081 31 212026 1358.40 

twwtiB +2.1 17BS.74 17S4.70 1786.46 112flL4Q_ 


TTRUSTSIHOI 2997.76 +032870 84298644 3010432245,10 


348 4.71 

3.17 439 

4.43 532 

446 4.64 

2.76 666 

3.10 520 

3.43 X13 

2.13 1.71 


26.71 1334 
2737 22.08 
2038 934 
27.11 0.00 
1839 1037 
2420 1019 
42.33 230 


98243 

946.13 

95136 

96240 

964.07 

108639 

1005,68 

99338 


C aw" Treat 
aw* Tareporrt 

Stash Eon 
SmaniMUOft . 
Gm» S tapna+rt 

Bmwr • 


3reN Beacham Uta-t 2.DOO aaah 

SraBtohds. ^ — 

8outt*nBectt 
Soirih Walaa Bact 
Sou* VW Wan* 

Saudi Weai. Bad. 


♦23 

<4 

1400 SSI +7 

906 +11 

2B0 ♦+ 

2030 +34 

171 +8 

464 417 

301 +14 

360 +10 

121 B -2 

666 +14»J 

400 46 

419 ♦« 

122 -M 

1B7 43 

1300 360 +13 

679 +» 

712 +10 

eift +13 

273 +10 

396 S19 +13 

Sjoco l«J* +14. 

1^00 402J2 

2400 309>2 «6V 

1,600 
720 


1300 

300 

097 

8-200 

1.300 

3.700 

3400 

21 

707 

700 

1.100 

1400 


7300 

897 


SctfhemltMar 


FT-SE-A ALL-SHARE(BSfl 

■ Hourly movements 


1675.49 


+12 1654.67 1650.46 1682.93 1403.48 3A3 520 23« 5.13 1283.73 


1000 


„ 9.00 iojoo 11 jo iao° ww iw i^o° m° 

s^roo S r.4 »* ■; g jg ® 5u *S SS2 

SE SI M ! 676.4 187*3 «1 16792 167^3 16822 168*8 1686S 

Tima of FT-SE ioO Hl9h 1*30 U» O** 

■ FT-SE Actuaries B50 Industry baskets 

Open 920 1020 1100 12* «* 


SiMiAMnoit 

76M 

TlOpupt 
ISBt 
Tone 
itafti 

asf- 

Tltamei Vtaerf 
UnmEWt 
Tco*an»t 




179 

21S 

177 

zs 

1*0 
1*0 
1*0 
2*0 
647 
9.100 
wo a 

1,700 

1*0 

BJ0OO 

665 


BBS 

717 

SOT 

040 

SS3 


367 
242 
417 

248 ^ 
195 +*h 


♦11 

+11 

♦0 

+12 

-12 

+2 

♦ft 

♦2 

+3 

♦8 


16* 18.10 Ctea PwM o mo Piongo 


Bldg 4 Cfwtrcri 
PhuRtacauuds 
Wfitar 
Banks 


1438.4 14*12 1«0| JJJJJ JotK M6*2 M7S2 *Se 

30631 “Hi fSSi Ss7 1W62 1W0-6 10412 1837.8 19382 19222 +15.7 

S SK Ski Si SSI « ® ™ 32,5 4 32245 *«• 

Die FWiri«i« Thaa 
p^a+MUdmdlcB 


Untadl . 

UHL Mroanopnn! 
VOAtaat 

Wcteh Water 



.-•HUpa-t 

wwaCorroon 

Wnn* . 
W B ln li y t 
1WM8K1 
YoriaWreWtaor 
Zwwat 


174 +2 

MO +^2 

557 

1093 -a 

1500 2 K 

111 43 

380 47 

♦10 

16 

882 *3 

2,000 emh 42ok 

551 895 +11 

664 412 

078 41 

088 43 

505 4ft 

333 

222 -1 

223 +4 

801 # 

541 +13 

661 *11 

709 +17 


344® 

SI » 

775 1149 

MOO MS 
467 


123 

as 

704 

080 

2500 

549 

260 


54 

1/400 


Bom! m oaSng tar f taaedon « tm* 
aacuMn Ml Bimtfi Via SEfQ synm 

T Wtn^ na 430pm. TWdeS td one nUancr 
mom ta raided doan. f MdEtaa «■ FT^E 

too hdm cnraaueM 


feeling that HSBC shares have 
outperformed enough in the 
short term,” said one analyst. 

HSBC shares touched 971p 
shortly after the figures were 
announced, but retreated 
thereafter to plose only 7 
higher on balance at 945p after 
turnover of 5.8m. 

Switching out of HSBC and 
Standard Chartered - the lat- 
ter fell 12 to 12l5p as fund man- 
agers fretted! about margin ero- 
sion in Far Eastern markets - 
helped the other UK banks 
make strong progress after last 
week’s sell-off. Barclays was 
chased higher, r.lnRf ri g 17 ah«+arf 
at 558p, while Lloyds put on 14 
at 6G3p and N atWest the equiv- 
alent of 16 to 501p ex-dividend. 
TSB were aggressively bought 
moving up 9 to 246p, while 
Abbey National, reporting this 
morning and where the market 
will focus its interest on the 
dividend, rose 6 to 505p. 

Life assurance stocks under- 
performed the market ahead of 
a television programme high- 
lighting the pension transfer 
story. General Accident, 
reporting today, jumped 18 to 
447p. Sun Alliance closed 8 
higher at 357p, with analysts 
tending to discount the latest 
speculation surrounding a pos- 
sible bid move by TransAtlan- 
tic Holdings. 

A deal to merge the retailing 
operations of Our Price and 
Virgin group helped 
WJL Smith “A” surge 13 to 
519p. Stores analysts were sup- 
portive of the move, which 
they said would bolster Our 
Price market share through 
better management and also 
through the more aggressive 


NEW HIGHS AND 

LOWS FOR 1993/94 

mr MOHS 137). 

BRBMEBB (!) Qreouenor bra. BMLDM9 8 
CMSTRN B) Mowtam (0, Tay Homes. BUM 
MAILS A MCKTS |l)«Ma«, CHEMKSALS (1) 
Cm* HL. DOmBinORS P) BM FMX. Ewm 

HnMKmm. Fata Mot. IlltPlim MTI KKt M 
Kraamar a Unklta, B£CTIWC ft ELECT 
COUP n Cepyroa. Mod+mc. MoutaN. 
Scry. TDK TtvrptfWi. Tomrta Car^ 
VtKh. motNEERnW H Aoaa Copco B. Gam 1 
S3 55o f*t_ Bmta TeeL Uwanwii Bran, 
Uenac. Ranald. Staa. WWoon MX. 
EXTRACIwe M08 0) BoUta Gold. NSM. 
Wavartav MtaQ Ftaanca, FOOD MANUF C8 
Bort— taa. Oanta (B. IM 8UBA W CS 0) 
Wnm. INveSTMSIT TRUSTS n Abartan 
SpW Lata Cop. BFM Japan wna.. FurttfMi Ban. 
Smote. Oanarel ConaKl ta Cap. 3pnoreT«c 

2am pi.. 3WEsn(srrcotmMS pi jr 

P tapta g Japan. LJOauta A HOTELS K1 
BkiebM Toys, ktaictasaar um. Ramadm'a M, 
Staky LaM. MEDIA W Abbot) UreaJ yietag, 

Metro Bata. P tata A . Oucoto. Sunset i Vina. 
Telegraph. OU_ WTBQRATED (1) Norsk Hydro. 
OTHER PMANC1AL (2) CkMa. DariKl Seta.. 
OTHER 3ERVS ft BUMS (1) Plta ta Ot* . 
PTHNO. PAPER A PACXQ (3) DMyn. Huntare 
Anrnlay. Lm ft Bonar. Bagant A. Urnlay Hoftor. 
PBOPSHY (Q An^o Sl JemaA CarcSD Prep, 
RETAILERS, FOOD (1} Part Food. RETAAStt, 
QBCRAL m RoaoDyA 8UFPORT 3ERV8 » 

. Qxp< 


AUBOCANS (D Lota's. Srei Co. ta. 
new lows t+CA 

03.79 A Traas. 1£pc V*, EjkH IMcc 94, 
EaetL ISlipe 94. DOURANCE (t) USF ft Q. 
WVESTNENT TRUSTS (I) Bartig Emg. Bro. 

wm. buppobt ssiva <9 Botad m, 

Hakim Prowetion. AMCMCANB 0) Amar. 
CyanamU. FPU Hounon tnOs. 

use of the Virgin name. Fur- 
ther down the line, there was 
speculation that the division 
would be floated off, an old 
rumour but given added impe- 
tus by yesterday’s move. 

Kingfisher climbed 15 to 
6 Q 2 p, aided by a buy recom- 
mendation from Lehman 
Brothers. Hie broker believes 
that the quality of toe group 
management deserves a pre- 
mium to its current market 
rating and also forecasts a 
hefty 40 per cent leap in profits 


at French subsidiary Darty. 

Weekend press comment and 
Friday's management changes 
helped Burton gain 3Vi to 55VIp 
in another day's big turnover 
of 30m. 

Both classes of BT stock, the 
"old” and the "new” partly- 
paid shares, made rapid prog- 
ress as institutions searched 
for good value in the market. 
BT “old” settled 7 higher at 
434/lp after turnover of 6m. 
while the "new” rose 8% to 
336V>p on 5.8m. 

Racal Electronics rose 9 to 
229p, albeit in rather thin turn- 
ova: of 648,000 shares, as two 
Sunday newspapers revived 
the long-running story that the 
company may attract a take- 
over bid from Cray Electronics. 
The latter moved forward 3‘/« 
to 193p. although volume was 
also low. 

Vodafone shares easily out- 
paced the rest of the telecoms 
sector, climbing 2frAp to 601'Ap 
in the wake of what was 
thought to be good US support 
and despite short-term caution 
being put forward by some UK 
broking houses. 

NatWest Securities took 
Vodafone off its short term buy 
list, citing the launch of Hutch- 
ison MicroTel's PCN product in 
the iMiming weeks as likely to 
rekindle investors’ fears over 
competition and pricing in 
mobile phones. But NatWest 
emphasised its long-term sup- 
port for Vodafone shares. 

Several engineering and 
aerospace stocks were part of a 
buy programme said to have 
been carried out by Nomura. 
The list is believed to have 
included Rolls-Royce, 3 firmer 


at I7lp in high volume of 8.2m, 
Smiths Industries, 9 better nt 
488p, Glynwed International, 
which gained ll at 37lp, and 
Lex Service, up 12 at 554p. 

Tobacco and financial ser- 
vices group BAT Industries 
languished for most of the ses- 
sion on fears that the US Food 
and Drug Administration 
iFDA) may apply drug regula- 
tions to nicotine in cigarettes. 
The strong market trend and a 
feeling that the earlier retreat 
had been overdone helped the 
shares recover to end a net 3 
ahead at 48lp. 

international trading group 
Lonrho advanced 10 to 163' ip 
following Friday’s court ruling 
in Ghana which clears the way 
later this month for the flota- 
tion or Ashanti Goldfield, in 
which Lonrho has a 45 per cent 
stake. 

Other big moves 

Among computer services 
groups, Micro Focus jumped 42 
to I025p ahead of preliminary 
figures expected on Thursday. 
Admiral, scheduled to report 
this morning, raced up 22 to a 
record 515p. 

The market’s two debut 
stocks performed well. Rad- 
stone dosing at 131p compared 
with the I25p placing price, 
and Finelist ending toe session 
at 150p, against a placing level 
of 130p. 

MARKET REPORTERS: 

Christopher Price, 

Joel Klbazo, 

Steve Thompson. 

■ Other statistics. Page 24 


LONDON EQUITIES 


LIFFE EQUITY OPTIONS 


RISES AND FALLS YESTERDAY 


FMto 


n pftyi 


CHS Ms 

Apr M Oct Air fee Oct 


Option 


— Mi— —Pun — • 
Map Aeg Hev May Ang NCN 


600 41* BOW fiOVi «H 2SH 32M 
(*627) B50 14K 26 96M33S3MSM 

240 20 31 H 3454 8 15 17 * 

260 14 21 2Ctt IS 2SM 2BM 
SO W1ZWT3H IK 3 *V> 
go SH BH 8 5J4 7K JO 


*Bft 

(*258 ) 

ASM 

rS7») 


M Ataays 420 41K SI 58* 6 17H 22 
P4S2) 4SM51S28V4 37H 21 3B» 42 

UDBtaA 390 2714 40 50 12M 23M 31 
420 UaBHSBVt 29 388 <7 
500 B 83 80» 3# 14# 18 
580 18 33N 40H 19H 38 40& 


(■2771 


(*402 ) 
Bocto 

rs«) 


BP 360 20H 31 37% 10 19 2Sh 

(-307 ) 380 7 17M M28M36H41K 

M8< SM 140 10M 19 10W ft 11 14 

(*143 ) 180 ZB 78 11 19 Z3h 26 

Bah 500 48 «1 72H 6V» 16H 22 

(*536 ) 550 18 33tt«H25»40H 48 

CMSMt 450 34 4BM - 8M 214 - 

(*471 ) 475 18 33* - 18 31* - 

Caartufea SOO 19» 3BK 37» 18» 33 38 

(-SOI ) 550 6 1214 18 66 88 71B 

GonalHon 800 41 a CiO*iB»27ft 
(-625 ) 650 IS* 38VS 38 35 45U 5314 

IQ 750 27 4BH54* 27 42 52* 

1*782 ) 800 8H2BH 34 84 73 84 

Kln^few 6Q02BH <2 5 ZH 23 40H 

(*802 1 850 KM 22 3ZM 57M 72 79 

La*} Saar 700 41*51* 59 7 23 28* 

(-729 ) 730 14 Z3* 32 30 50* 53* 

MBla ft S 420 19 28 IS 10* 21 23* 

r«B ) 400 ft 12 17* 30* 40 47* 

NaMtat 460 48 605 70 6* 14* 21 

(*488 ) 500 28 41* 48 22 31 Y5 38 

SBrabuy 360 23 32* 0 11*23* 28 
r» ) 390 9 19 28* 29 41* 48 

Shagftu. 700 22 37* 46 20 30 38* 

(711 ) 7S0 ft 17* 24* 58* 62* 70 

Sfcrahoue 220 S4 30* 34* 3* 8* 11* 

(*238 ) 240 19* ■» 28* 11 17* 21 


(131 ) 
Lucas Ms 

f220 ) 

P&O 

CW1 

FWspBn 

(153) 


280 23* Z7 31 4 8 11* 

280 11 18 20 12 18* 20* 
IX 12 19* 24* 12* 17 22 
140 8 15* 18* 18* 23* 27* 

220 12* 20* 28* 14 18 25 
240 5* 12 17 27*31* 37 
650 49G7*7S* 18 33 48 
700 22 43* 34 45 60* 77 
180 21 26* 30* 5 9* 1Z 
200 9 15* 19* 14* 19* 22 

300 9 34 38* 6 12 18* 

330 TO* IS M 22* 28* 32* 
850 37* 00* 78 34 47 81 
800 23* 39* 54* 57 78* 80* 
550 S3* 61* 71 15 26 37* 
800 22* 94* 46* 42* 53 64* 
280 32 40 48 8 13 18 

300 19 a « 17* 22* 26 
220 18* 34* » 10* KM 18M 
240 9 IS 21 22* 26 3D 

800 35 5572* X 48*56* 
BfiO a 34 SI* 82 76 85* 
390 If* a* 3310* S 31 
420 7 14*21* 40 44 49* 

Apr M OeJ Apr JJ Od 



.. - SR 

4 







- - 63 


76 










- . . 179 


295 


a a 


B 

168 


. 122 

100 




193 

28 


... 42 

62 



Totals 

1,041 

448 

1221 


f3Z4) 

RTC 

C852) 


rs8z> 
Itoysl tosce 
(-3# ) 
Tosco 
f23D ) 


Data band on mas i rei y nl u a IMM on rta London Sara Sava. 


TRADITIONAL OPTIONS 

first Deeihgs March 4 last DedaraUora 


Last Doafing* 


March 21 For settlement 


JinaS 

Juna 13 


r«oo) 


P383 ) 
OpOon 


BAA 

non) 

Dtaltt 

<*558 ) 
Optal 


ion a 

1050 a 

550 a 
600 ■ 
Apr 


61 81* 3 43 51 
38* 87 52 70 77* 
a 41 14 32 35* 
14 20* 46* 67 68 
JOB Ssp Apr Jso Sep 


CaftK Angie, Anglo Pacific, Arcon Mi, Amoco, Courtyard Lok, CariWa Grp, 
Cavoiriftte, Development Sac. E ntaptrfa o Comp, Otaeycoat, Medwe, Mtao Focus, 
Nmn Roe, Raneomee prat. Sttflnw. Signet Pula: Entaipitaa Comp. Mo+an Rea, 
SkSaw. Puts ft Cals: ASDA, Anglo Pecffic, Avesco, Devolopmem See, Om a nwtc h 
Rae, Hanson Wta, Medeva. 


LONDON RECENT ISSUES; EQUITIES 


Abbe? Ntf 

rS04) 


r» i 

todays 

r»i > 

Blue Orda 
P347) 
Britt* Qas 
(*323 ) 
Bans 
CZ14 1 


50013* 
550 2 

35 3* 
40 I* 
550 18* 
000 4 


26* 87* 17 27 34* 
8 II* SB* 82 66* 
5* 7* 2 3* 5 

3* 5* 5 6* 8 

32* 44 20* 32 42 
18 M* 60* 86* 73* 


TR 

nit) 


P147) 


ms i 

Option 


106 13 17* 
115 8* 13* 
1100 82 a 

1150 27* 49 
750 W 49* 
boo ft a* 


- 5 * 

- 10 * 
9S 14 
98 38* 
83 23* 
42 63* 


9* - 

15 - 
24* 41 
51*64* 
42 54* 
72 M* 
Auq No* 


Grand M 

r«3) 


(■208 ) 
IM 
(-344 ) 
OpftfH 


480 a 48 
500 17*27* 

200 18 a 

220 8* 15* 
330 26 31 
360 8 18 


98 12* 

37* 31 

a 12 
a* 24* 
* 13 
2Z* 33 


18 24 
38 44 
17* 24 
29* 35* 
18* 25 
37* 42* 
Am Sep 


120 12 18 24 4 10* 14* 
130 S 13 19 9 15*20* 


(127) 

Option 


■*» Ang Mar May Aug Ktw 


Bra Aero 500 48 87 82* 30* 46 86* 

(*S06 ; 550 a 44* 91 70 75 86* 

BAT h* 460 30 38* 48 19 27* 35* 

(-475) 500 12* 22 29* 48 52* GO* 

Bin 360 w zm 33* urn 22 a 

[-368 ) 3907* 15 21* 374147* 

Bril Idem *20 ZT a 41* 0*10*23* 
r«4) 450 8* 18* 23 31*40*46* 

CafeuySdt 483 22 - - 17 - - 

(■505 ) 542 8 - - 53 - - 

Eastern Bee 650 35* 40* 56* 21 38 45 

(*858) 700 14 28* 36 51* 69 7SH 

&dmag 500 37* 51 S3 18* a 35* 

(-524) 550 13 27*39* 43 57 S3* 

SEC 300 » 33* 37 5 11 14* 

(-320 ) 330 11 18* 21* 18 27 30 


(*174 ) 
10*1)0 
PB2) 

Na> Poeer 
(*492) 
Scot Cover 
{*416 ) 
Sears 
(* 122 ) 
Forte 
<*2SB) 
Tame 
(194) 
Hum a* 
(1085) 

TSB 
[*246 ) 
Toarifev 
PZ621 


330 23* a 45 4 14* 22* 

380 8* W* 21 18* 32 39 
300 a 31 34* 2 8 11* 

330 S* 12 17*12* 23 27 
200 18* a* a* 4 8 15 

220 B 16* 20* 13 17* 25 

180 17* 19* 2W 1* 7 9* 

180 4* ft 13* 9 19 21* 

MO 9* 19*25* 7 J4 X 20 
180 3 11* 17* 21 27 23* 

480 38*47* 65 3 12 20* 

500 9* a 34 16 32 36* 

390 39 44 & 3 9* 19 

4a 1ZH Z7 34* 12* 22 32 

120 S 9 12 3 7 9 

130 2 ft T* 10 14 IS* 

240 a 27* 34 2* 9* 14 

280 8* t5* 23* 6 19 24* 


laaue Aim 
Price paid 

P up 

MhL 

cap 

(&riJ 

1083(94 

Hgfi Loir Stock 

Oooe 

price 

P 

+/- 

Net 

c&v. 

Kv. 

cov. 

G« 

** 

WE 

net 

► 

FJ>. 

2545 

m 

163 Aipfta Akports 

169 

♦1 

RN4JJ3 

12 

10 

195 

160 

Fi>. 

1013 

149 

148 Ctfeoxlance 

149 


- 

- 

- 

- 

124 

FJP. 

259 

188 

148 CMcai Computhg 

160 

♦7 

- 

> 

- 

255 

23S 

FJ>. 

67.4 

268 

250 Coda 

257 


WN*D 

45 

1-0 

2&a 

§90 

FJ». 

558 

173 

108 Comp Fto Sol 

140 

+10 

W- 

- 

- 

215 

SO 

F P. 

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aapSaanon ot Other noma. 1 

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A8 Oct Apr Jd Oct 


RIGHTS OFFERS 


Bam 600 60 76 87* 17* 3<H 51 

(877) 700 23* 50 81*43* 80 77 

900 68* 108 131 45* 76* B3* 

(*41 ) 950 4J 83 107 71 103 117 

2000 81* 145 184 68* 108 136 
gOEOSK m W0 06* 133 180 
Op»n May «*r IM9 N W 


Issue 

price 

P 

Arnowit 

pa« 

W» 

Latest 

Renun. 

date 

1990/94 
Mflft Low 

Stock 

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price 

P 

■KIT- 

20 

NB 

1173 

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11 

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23>2Pni 

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120 

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33pm 

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40pm 


53 

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23/3 

28pm 

18pm 

Spring Ram 

22pm 

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10 

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28pm 

17pm 

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26pm 



Mc-flsyct 
(171 > 


160 18* 22 25* 
180 7 12* 18* 


6 10* 14* 
17 21* 25 


pm Pries H a pramkn. 


FINANCIAL TIMES EQUITY INDICES 

Feb 28 Fob 25 Feb 24 Feb 23 Feb 22 


Yr ago *Hgh *Law 


* UreHrtytag security price PranDuma shewn are 
oaad tn dosing <*v p*oa. 

FeCnary 20k Total contracts: 31,073 Calc 10,242 
Pita ifUBI 


FT GOLD MINES INDEX 



m * <*g 
» oc day 

Feb Feb fear 

M 23 ago 

feed A 
yWd % 

52 MMfc 
■gft Low 

MdMhtthdmtW 

197303 +t£ 

1B57A5 19BL21 118745 

199 

238X49 112X27 

retains 

»unniaa*(B) 

Morm America ( 11 J 

2818.63 +40 
2435.73 -43 
1719,13 +0J 

2519.48 256571 1J4637 
2544.10 2S41J1 HE7J31 
1707J7 1701.81 1102.66 

520 

151 

055 

344080 124259 
3013X9 1158X7 
203065 1075X4 


Onfewy Share 

2564.1 

2636.9 

2529.1 

2578.4 

2578X 

2225.5 

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Om.dv.yWd 

3.63 

3.87 

3G7 

3X9 

3X7 

4.36 

4X2 

143 

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4X4 

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4X0 

3X8 

3X9 

6.11 

are 

3X2 

P/E ratio net 

22.40 

22.15 

22.15 

32X9 

32.70 

20X2 

3aA3 

19.40 

P/E ratio id 

MM 

23J» 

2X09 

30X8 

30.14 

19.34 

30X0 

18.14 

Tar 199W94. Cranary Stars tedes tare GMiphrifart hgh 2713.6 2/02A4; tea 494 28/640 
FT OnSruy Shea hdm brae dta 1/7/35. 



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253&fi 2546.1 254&5 25SL3 2549.4 2557.5 26S7.0 26SS2 25608 2564.1 2S3t3 
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Eqtftty turnover pm)f - 1678 A 17502 17105 15507 115^2 

EqUty IwgahST - 4Z596 37J7S 32,405 36.938 40,188 

Sham traded (ml)t. - S81-S 844J2 714.6 5TSA 5192 

t Muttra miMBrtiai bteneae and oneraan tumor. 







FINANCIAL TIMES TUESDAY MAR CH 1 1994 


LONDON SHARE SERVICE 




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FT MANAGED FUNDS SERVICE 









































































































































































































FINANCIAL TIMES TUESDAY MARCH 1 1994 


FT MANAGED FUNDS SERVICE 





























































































































































































38 


FIN ANCIAL TIMES TUESDAY MA RCH 1 1994 

HOMEY market funds 


CURRENCIES AND MONEY 


moves higher 


MARKETS REPORT 

D-Mark 


The German Bundesbank 
yesterday sent a clear signal 
that interest rates are likely to 
fall when it announced a vari- 
able rate for its 15rday secvnv 
ties repurchase tender, writes 
Philip Gawith. 

The repo is the main instru- 
ment by which the Bundes- 
bank sets money market rates 
and a variable rate - which is 
more responsive to market 
forces than if the Bundesbank 
sets the rate itself - should her- 
ald an easing of monetary pol- 
icy. 

Yesterday's move came 
amidst indications that last 
week’s turmoil in financial 
markets, and pressure on the 
dollar from a stronger yen, 
have combined to lend 
strength to the D-Mark. 

The German currency closed 
in London yesterday at 
DM1.7069 against the dollar, a 
pfennig stronger than its low 
for the day of DM1.7167. It was 
also stronger in Europe, clos- 
ing at L988J2 against the Italian 
lira from Friday's close of 
L984.3. 

The prices of UR and Ger- 
man interest rate futures also 
recovered yesterday, indicating 
a return to fundamentals in 
markets' assessment of the 
outlook for interest rates. 

The dollar gained initial sup- 
port from the German repo 
announcement, and the down- 
ing of four Serbian aircraft by 
NATO. Renewed fears, how- 
ever, of a stronger yen after 
the weekend's G7 summit kept 
the dollar under pressure and 
it was trading lower in New 
York. 

■ Although the Bundesbank's 
move to a variable rate repo 
was not unexpected, it was still 
welcomed as confirmation that 
German interest rates are 
likely to fail further. It is the 
first time the Bundesbank has 
set a variable rate tender since 
mid-November. The repo rate 
has been held at six per cent 
since early December. 

It may, in the short term, 
prove to be of mostly symbolic 
significance. For technical rea- 
sons - the allocation of funds in 
this week's repo coincides with 
the introduction of new mini- 
mum reserve requirements for 
banks - the repo rate is 
unlikely to fall much. 

Easing reserve requirements 


DoOar 


Against the Yen (V per S) 

110- * 



Soutw FT Graphite 


■ Pound in Kn York 


no 28 

— Latest — 

- PW. etasd- 

£ipot 

1.4880 

1.4865 

mm 

1.4858 

1.4382 

3 mbi 

1.4828 

1.4831 

IF 

1.4749 

1/1749 


will put liquidity into the mar- 
ket The Bundesbank will want 
to drain this liquidity without 
putting upward pressure on 
short-term rates which are 
already high. German call 
money is trading at about 6.7 
per cent, up from 6 per cent 
before the Bundesbank eased 
policy on February 17. 

Mr Avinash Persaud, head of 
currency research at JP Mor- 
gan (Europe), described the 
move to a variable rate as 
“highly significant’’. He said 
the early resumption of Euro- 
pean rate cuts, which the 
Bundesbank move appears to 
encourage, provided the signal 
to stop the liquidity with- 
drawal which has hit world 
bond and equity markets 
recently, and also spilled over 
into currencies. 

Not all observers were as 
sanguine. Mr Paul Chertkow, 
head of global currency 
research at UBS. said the vari- 
able repo would help, but mar- 
kets remained “incredibly ner- 
vous". He said that, although 
UBS’s three month prognosis 
for the dollar remained posi- 
tive, the short-term outlook 
was “very depressed". 

Mr Chertkow placed the 
blame for the current uncer- 
tainty squarely with the US 
government. “The Clinton 
administration is playing with 
fire and it could very easily get 
out of control” He said a finan- 
cial meltdown similar to Octo- 
ber 1987 was possible. 

The UBS analyst said the 


only means of averting this 
scenario, and arresting a possi- 
ble dollar rout against the yen. 
was a “policy catalyst". 

“The policy (of talking up 
the yen) emanated from the 
Clinton administration anrj the 
Clinton administration, 
through the Fed, must now 
act," added Mr Chertkow. 

Just as the Fed intervened to 
support the dollar last August 
when it fell to Y100.3, so it 
should do so again, “actively 
and publicly”. 

Putting downward pressure 
on the dollar was the absence 
of any clear statement from 
the weekend G7 meeting of 
agreement between Japan and 
the US about their trade differ- 
ences. The Bank of Japan is 
trying to counter the strength 
of the yen, with some traders 
estimating that the BOJ has 
been buying dollars to the tune 
of S500m-$lbn a day. 

With, the BOJ not apparently 
enjoying much support in its 
efforts, there is little confi- 
dence it can resist the trend. 
Most observers agree that the 
rate is the function of political 
events, although some argue 
that fundamental flows into 
yen - the current account sur- 
plus not being fully offset by 
capital outflows • could be the 
dominant force. 

B Sterling had a fairly quiet 
day. Although the trade dis- 
pute with Malaysia is a nega- 
tive factor, the currency is 
being underpinned by the pros- 
pect or lower interest rates in 
continental Europe. It finished 
slightly lower against the dol- 
lar, at $1.4861 from $1.4904 on 
Friday. Compared to the 
D-Mark, it fell to DM2.S366 
from DM2.5418. 

B The Bank of England yester- 
day provided UK money mar- 
kets with £325m of late assis- 
tance after revising its forecast 
of the Liquidity shortage to 
£l.45bn. Earlier it had provided 
the market with £l.\36bn of 
assistance at the established 
rate of 5& per cent 

■ other coHRucms 

Feb a e s 

Mnp! 154.087 - 154.339 J 03.720 - 1(0820 
tan 2587 00 - 25SL00 174100 • 175000 
Kim* 04409 - 04423 02988 - 02975 

Poland 32611 9 - 325338 219520 - 219500 
Russia 232025 - ZE125 158050 - 156750 
UAL 5.4398 • 5.4710 M715 - 3S735 



Feb 28 Opdng °rnge Bld/oflar Day's Md owmenti Tie*® monStt Onayaar Bank of 

onday spread righ low Rate %PA Rp(o XPA Rata MPA Eng- ***» 


Austria 

(Sdi) 

17.9121 

*0.0005 

015 ■ 247 

17.9330 17.6645 

17.9093 

03 

17.9037 

02 

_ 

_ 

113.3 

Belgium 

(BFrt 

522216 

-0.1195 

743 - 689 

££.4751 52.1743 

522786 

-15 

525816 

-12 

527068 

-05 

114,4 

Denmark 

IPKiJ 

9.9324 

-00295 

253 - 394 

9.9654 9l3253 

9542S 

-12 

9.9633 

-12 

80988 

-0.7 

1145 

Finland 

(FM) 

62205 

-00222 

103 - 307 

0-2736 EL2103 






. 

81.7 

Prance 

(FFr) 

8.6244 

•00256 

197 • 290 

8.6660 a 61 07 

AfttAS 

-15 

06*8 

-1.1 

6676 

-05 

1QB2 

Germany 

P«) 

24^66 

-OJA92 

352-379 

2-5583 26352 

25395 

-1.4 

2S424 

-OO 

25445 

-03 

1225 

Greece 

(Or) 

367.736 

-033 

240 - 231 

389038 387540 





• 

. 

- 

Ireland 

m 

1.0398 

-00027 

381 ■ 415 

1JJ443 1.0381 

1.0404 

-0.7 

1042 

-09 

1.0482 

-ae 

1029 

Katy 

w 

250628 

*5.03 

532 - 864 

2S1&Z7 250423 

2S13« 

-20 

252558 

-30 

257453 

-27 

T55 

Luxembourg 

(Lft) 

522216 

-01195 

743 - 889 

52^751 52.1743 

522768 

-1J 

623816 

-1-2 

62.7066 

-03 

114.4 

Netherlands 

fFQ 

2A483 

-04)062 

47B - 506 

2-8631 18479 

25505 

-0-5 

28509 

-02 

28445 

02 

110Q 

Norway 

(NKt) 

11.0040 

-0.0301 

9GB - 092 

11.0633 109368 

105984 

as 

11.0109 

-03 

11.0021 

0.0 

645 

Portugal 

(Ea) 

257S12 

-1JB7 

603 - 220 

253-521 257803 

258587 

-45 

280632 

-45 

- 

re 

— 

Spain 

(Pm 

206.731 

-0401 

002 - 860 

207.708 208.802 

207581 

-38 

208561 

-3.6 

212501 

-29 

852 

Sweden 

GiKr) 

11.8675 

-0.0415 

579 - 770 

11-9338 118236 

11587 

-20 

11024 

-i a 

12047 

-15 

75.9 

Switzerland 

(*4 

Z1225 

-000*3 

210 - 239 

2.1209 21208 

21208 

09 

21167 

1.1 

20964 

12 

1185 

UK 

W 

- 

- 

- 

- 

. 

- 

• 

- 

. 

- 

BOB 

Ecu 

- 

12118 

-00027 

109 - 122 

1-3176 1.3109 

15129 

-15 

1.3154 

-12 

13208 

-07 

- 

SOR 

- 

0242397 

- 


- 

. 

• 

_ 

_ 

_ 

re 

- 

Americae 

ArgenLna 

(Peso) 

1.4859 

-000*7 

8S3 - 665 

1.4900 1.4834 

• 







Brazil 

(CO 

94A9B8 

*11.48 

65* - 321 

949.000 931.000 

- 

- 


- 


- 

- 

Ctnada 

(CSJ 

2.0098 

-0.0032 

065 - 106 

20118 20000 

20073 

13 

20038 

12 

15963 

07 

89.1 

Mexico (New Peso) 

4.7441 

-0.0285 

316 - 646 

4. 7648 A6907 

- 

- 

re 

- 

• 

- 

_ 

USA 

S 

1.4881 

-0.0043 

8S6-BE8 

1.4900 1A835 

1.46* 

1.7 

1.4809 

1.4 

15726 

09 

66.1 

PacMc/Mtddfe Eaat/Atrtca 

Ausxrala (AS) 22851 

*0.0167 

836 - 865 

20334 20680 

20836 

oo 

20812 

07 


as 


Horq Kong 

(HSS) 

11.4824 

-0.0425 

rn ■ uni 

11^239 11.4637 

11/4664 

1.4 

11.4638 

ae 

115149 

ae 

- 

Irate 

(Rs) 

46.6115 

-01406 

884 - 346 

*6.7340 48.5410 

re 

- 

- 

- 

- 

- 

- 

Japan 

ro 

154.778 

-1^99 

666 - 889 

155.950 154570 

154.403 

29 

153583 

20 

150293 

29 

1875 

Mafayria 

(MS) 

4JJ5Z8 

-0.0109 

497 - 554 

4.0838 4JM40 

- 

- 

- 


_ 

. 

- 

New Zealand 

(NZS) 

2-5821 

-00002 

798 - 845 

25663 25715 

2585 

-13 

o ratm 

-1.1 

28979 

-06 

- 

PhSippina 

(Pbd t* 

41.1651 

-0.1177 

028 - 275 

415160 41.0026 

- 

- 

re 

re 

re 

re 

- 

Saudi Arabia 

(SH) 

5^731 

•00163 

707 - 755 

5.5880 55633 

- 

. 

- 

- 

. 

re 

— 

Smgapare 

ISS) 

23496 

0.0089 

480 - 511 

23608 23469 

- 

- 

. - 

. 

- 

. 

- 

S Africa (Com.! 

1 (R) 

5.1564 

0.0155 

565 - 622 

5.1757 51515 

. 

- 

. 

re 

. 

re 

re. 

3 Africa £Rn.) 

(R) 

7-0033 

0.0163 

935 - 130 

7.0359 6.9335 

- 

- 

. 

. 

. 

. 

- 

South Korea 

(Won) 

1200.55 

-5J7 

007 - 102 

1205.11 119852 

re 

• 

. 

. 

. 

re 

_ 

Taiwan 

rra 

3S3S94 

0.1125 

387-800 

39-4400 395000 

. 

re 

. 

. 

. 

. 

- 

Thatend 

(B») 

37.6281 

0.0927 

005 .556 

37.8970 375690 

- 

- 

- 

- 

- 

- 

- 


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DOLLAR SPOT FORWARD AGAINST THE . DOLLAR 


Fab 28 

Clewing 

rrid-pomt 

Change 
on day 

B«Vbfler 

aptaad 

Day's mid 
high low 

One month 
Rate %PA 

Three months 
Beta %PA 

On* year J.p Morgan 
Rato %PA Index 

Eurape 

Austria 

ISrtt 

120538 

<4.0388 

500 - 575 

12.0705 124125 

12.0728 

-12 

121023 

-1.8 

121473 

-as 

1029 

Belgun 

(BFr) 

35.1400 

*052 

200 - 600 

35.3100 35.1200 

35^25 

-22 

3638 

-27 

35.82 

-13 

1045 

Denmark 

(DKr) 

a/grw 

-0.0008 

810 - 860 

a 7225 6.6810 

8 888 

-2 2 

67275 

-26 

8.7947 

-1.7 

10X3 

Rriand 

(FM1 

55316 

<0.0009 

266-369 

55712 55160 

53361 

-ID 

55456 

-1.0 

55718 

-0.7 

ms 

Franca 

(FFr) 

5 8034 

-0.0006 

022 - 04S 

5.8330 5.8022 

5,8193 

-33 

55407 

-26 

5.8912 

-15 

104.6 

Germany 

P) 

1.7089 

*0.0014 

065 - 072 

1.71H7 1.7065 

1.7114 

-3.1 

1.7169 

-23 

1.7278 

-13 

1045 

Greece 

(PO 

247.450 

*055 

200 - 700 

248.420 247.20Q 

2S1.32S 

-18.8 

2502 

-17.4 

287.45 

-102 

712 

keland 

OP 

1.4232 

-ODOM 

273 - 311 

1-431 1 1.4228 

1.4262 

28 

1.4204 

25 

1.4037 

1.8 

- 

Italy 

0) 

1688-95 

+6.18 

640 - 750 

1083.00 1684 DO 

1632D5 

-43 

1705.45 

-4.4 

1749.45 

-37 

785 

Luxembcuq 

(u=o 

35.1400 

*0.02 

200 - 600 

353100 35.1200 

35225 

-29 

3538 

-27 

3552 

-13 

104.0 

Netfwrtands 

(R 

15173 

*4 0013 

170 - 175 

1.8275 1.9165 

1S205 

-20 

13255 

-1.7 

1.9333 

-03 

1034 

Nraway 

(W<r) 

7.40*6 

<4.0009 

036 ■ 056 

7.4460 73995 

7.4131 

-1 A 

7.4308 

-1.4 

7.4596 

-0.7 

94.7 

Portugal 

(E5) 

173550 

-02 

400 - 700 

174.650 173.400 

174.415 

-6 D 

176.ira 

-6.1 

18275 

-63 

9X7 

Spam 

(PUI 

139.110 

-014 

070 - 150 

139 .850 138.070 

138.705 

-5.1 

14005 

-5.0 

14451 

-4.0 

pn*; 

Sweden 

(SKr) 

7.9857 

-00051 

819 - 894 

84335 7.944B 

8.0097 

-36 

8.0532 

-34 

01782 

-24 

81.1 

Switzerland 

(SFr) 

15282 

*00012 

277 - 287 

1.4332 1.4253 

1.4291 

-as 

1.4301 

-05 

1.4247 

03 

105.4 

UK 

(0 

1.4861 

-00043 

656 - 066 

1.4900 1.4835 

1.484 

1.7 

1.4009 

1.4 

1.4720 

0.9 

095 

Ecu 


1.1331 

-00009 

329 - 333 

1.1333 1.1272 

1.1305 

28 

1.1256 

26 

1.1149 

1.6 

- 

SDR 

_ 

1.39569 

- 

- 

. 

- 

- 

- 

. 

- 

- 

- 

Americas . 

Argentina 

(Peso) 

05999 

-00003 

998 - 999 

09999 0.9997 

. 


. 


. 

. 


Brazil 

(Cr) 

637.230 

*952 

220 - 240 

837.600 637.220 

- 

- 

- 

. 

- 

• 

- 

Canada 

tes 

15523 

*00017 

520 - 525 

1.3525 1-3479 

1-3526 

-03 

13532 

-03 

1.3563 

-03 

S5.B 

Mexico (Now Peso) 

3.19S0 

-0 01 

850 - 050 

320S0 3.7619 

3.1960 

-0.6 

31994 

-08 

331 

-05 

- 

USA 

(R 

re 

. 

- 

- 

re 

- 

- 

- 

- 

- 

1005 

PactAcAllddto East/AMca 
Australia (AS) 1.4030 

*0.0152 

025 - 035 

1.4059 1.3906 

1.404 

-03 

1.4069 

-1.1 

1.4144 

-03 

885 

Horn Konq 

(HKS 

7.7265 

-0.0065 

260 -270 

7.7320 7.7260 

7.7272 

-ai 

7.7312 

-03 

7.75 

-0.3 

- 

irate 

Ps) 

315650 

-0006 

600 - 700 

31.3700 31.3350 

31.43 

-25 

31.565 

-28 

- 

- 

- 

Japan 

(Y) 

104.150 

-0575 

110-190 

104.650 104.000 

104-0*5 

12 

10377 

1.5 

102125 

15 

147.1 

Mrioyte 

(MS) 

27270 

♦0.0005 

260 - 280 

2.7200 2.7240 

2.721 

26 

27045 

33 

2777 

-15 

- 

New Zealand 

(NZS 

1.7375 

*00048 

364 - 385 

1.7385 1.7232 

1.7391 

-1.1 

1.7436 

-1A 

1.7575 

-12 

-re 

Rkkppraa 

(Pmo) 

27.7000 

- 

000 - 000 

27.8500 27.5500 

- 

. 

- 

- 

- 

, 

_ 

Saudi Arabia 

(SRI 

3.7502 

-0.0002 

498 - 505 

3.7505 3.7488 

3.7526 

-03 

3.757 

-0.7 

3.7757 

-a7 

_ 

Singapore 

(SS) 

15810 

-0.0016 

805 - 815 

1.5633 15805 

1.581 

OO 

1.581 

OO 

150*5 

-15 

- 

S AMca (Com.) 

1 (R) 

3.4718 

-0.0005 

710 - 725 

34830 34675 

3.4881 

-42 

35151 

-5.0 

36123 

-4.0 

- 

S Africa (Fin.) 

(HJ 

4.7125 

<0.0025 

075 - 175 

4.7300 4.7075 

4.7435 

-72 

4.8075 

-Ol 

- 

- 

- 

South Korea 

(Won ) 

607.8S0 

-15 

800 - 900 

009-200 007.800 

61085 

-45 

81435 

-33 

63295 

-3.1 

- 

Tarwffi 

ITS) 

28.4650 

- 

800 - 900 

26,4900 26.4600 

■26.5875 

-4.6 

26.735 

-3.8 

- 

> 

- 

Thatend 

(Bl) 

253200 

♦4.01 

100-300 

25.3300 232700 

2639 

-33 

2553 

-33 

25.67 

-1.4 

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4 SJWrm Square. EtMurgkBCJPP 031 SM 8238 
MCA I 479 2S825 I 

Cater ABoh lid 

23 BkcMn In. Lta«M BC3V BOJ 071-0232020 

MCA I 275 181 I 381 1 *■» 

Omrrt £5,0001*1 *50 327 4281 14* 

uraMt 1*44 -I 4 53 1 10k 

CtarMMBM Bwk UrNbiI 

tik 
>79 

400 

425 

*50 
150 

ZOO 
225 
250 



877-8791158 
1 4.79 150 485 MU 

*M 328 488 MB> 

■ Coq4A- J 4J25 219 427 Ok 


-8089833 ” ” 

07 Qk RovriBaakof ScbOaodpicPmiomAcc 
07 Ok 42&«aiMHSB l E0ktaBBb21 l E. .Mi-55 


£c*a 

C500-£I2950 

DQ00M49S99 

esatuMBUoo 

ElOOflOO* 

Si0t»-«4SflM_ 

530.000409898 

S1WUM04I3BLM9— 

82008004. 


219 

a 

is 


C22000' £42898* 

ETtUM1-£2*9*J 
£5.000 -DW99_M 


9jDMSaS£h8 

j* MBAnoMMaaa tv I : 


mm 

ire 

16. 

HI 

oaoo: 

IB 

| AH 


A1B 



<n( 

(kMoi 


ton 

in 

1813 

1803 

M7» 

1900 

3JJJ2 



4060 

A125 

10D4 

4188 

un 


Urr 


tu 


■ M2IM 


i Bnk Hnftlo SaMtao Acc 

tOmdM 047-948 7D7D 

£10808-120898-. >370 278 1 273 1 Qk 

csatno-eMMo- — [27s zoi I 320 oo 

OOROOO-CIM.Mf — I 380 285 1 385 1 Ok 


UUTtatiUaM 

laMCWMOMaiMraWTHTM. 077-300094 
£10800-00 datnabca . I 879 888 ( UJ TW 

tmoao-HB^uttl-l 780 503 784 0-4» 

£25800-11*1 1 785 5*4 I -I Mat* 

United DaaHom Tiatt IM 

rate 82 , 11 B£*ifcO*»fHB*»*.»km. 0 MOtrf 

COWlMBaaMM 

£18004 —I 4.7S 258 I 48*1 Ok 


CROSS RATES AND DERIVATIVES 


EXCHANGE CROSS RATES 

FM32B BFr DKr FFr 


DM 


NKr 


Pta 


SKr 


SFr 


CS 


Bdipum 


(BFr) 100 19U2 1ft51 4.858 1.992 4801 5.456 21.08 433.9 395.3 22.73 4.064 1-915 3849 3848 296.4 2512 


EMS EUROPEAN 

Fab 28 Ecu can. 

rales 


CURRENCY UNIT RATES 

Rota Change K 4/- from K spread Dfv. 

against Ecu on day can, tala v wt M e at bid. 


Danmark. 

(pKr) 

5258 

10 

8683 

2554 

1.047 

2524 

2889 

11.08 

259.7 

208.1 

11.95 

2137 

1.007 

2024 

1496 

155.9 

1.321 

batand 

0508628 

0790844 

-0.001158 

-220 

4A5 

Franca 

(FFr) 

60.55 

1152 

10 

2942 

1506 

2907 

3304 

1278 

299.0 

239.7 

1378 

2481 

1.180 

2331 

1.723 

1795 

1521 

Netherlands 

219672 

217417 

*000032 

-1.03 

352 

Germany 

(DM) 

2058 

3515 

3599 

1 

0.410 

8885 

1.123 

4.336 

101.7 

81.47 

4579 

0538 

0234 

0.792 

0-586 

81.02 

0517 

Belgium 

405123 

395427 

-0.0448 

-092 

110 

hetoid 


5X21 

6550 

8592 

2439 

1 

2411 

2739 

10.56 

248.0 

1985 

1141 

2040 

0.962 

1533 

1.429 

148.8 

1562 

Germany 

154964 

153639 

*000088 

-088 

258 

Italy 

W 

2.063 

0.396 

0544 

0.101 

0.041 

100. 

0114 

0.439 

1059 

8545 

a473 

X085 

0D40 

0080 

0.059 

0175 

0052 

Tirana 

853883 

658146 

-000183 

085 

1.49 

Nothartanda 

1F9 

1033 

3.488 

3027 

0.890 

0585 

8805 

1 

3581 

9052 

7255 

4.166 

0.745 

a 351 

0.708 

0522 

5453 

0.481 

Denmark 

7.43679 

758400 

*000398 

158 

017 

Norway 

(NKr) 

47.47 

9529 

7.840 

2308 

0545 

2279 

2590 

10 

2345 

187.9 

10.79 

1529 

a. 909 

1527 

1.351 

140.7 

1.193 

Portugal 

192554 

196.789 

-0.48 

204 

Oil 

PuiBupd 

(&) 

2025 

3.851 

3544 

a984 

0403 

972.1 

1.105 

4.26S 

too. 

80.15 

4.603 

0.823 

0388 

0.779 

CL576 

6002 

0509 

Spain 

154550 

157570 

-0581 

216 

050 

Spam 

(Pta) 

25.26 

4505 

4.172 

1527 

0503 

1213 

1578 

5522 

124.8 

100. 

5.743 

1.027 

0.484 

0.972 

0719 

74.89 

0.635 







Sweden 

(SKr) 

4399 

8567 

7265 

2137 

0876 

2112 

2400 

9567 

2175 

174.1 

10 

1.788 

0542 

1.693 

1552 

1304 

1.105 

NON B«4 MEMB51S 





Switzerland 

iSFr) 

24.61 

4.680 

4564 

1.196 

0490 

1181 

1.343 

5.164 

1215 

97.41 

5.504 

1 

0471 

0.947 

0700 

72 95 

0618 

Greece 

264513 

280545 

*0588 

6.06 

-3.68 

UK 

(P 

5252 

9.932 

8.624 

2.537 

1.040 

2507 

2.849 

11.00 

257.9 

206.7 

1157 

2122 

1 

2010 

1486 

154.8 

1512 

"tey 

170119 

190857 

*068 

031 

-190 

Canada 

PS) 

25.96 

4541 

4591 

1582 

0517 

1247 

1.417 

5473 

1285 

102.6 

5.905 

1.056 

a498 

1 

0.739 

77.01 

0.653 

UK 

0.786749 

0799562 

-050098 

-3.40 

551 


US 

Japan 

Ecu 


<S) 35.14 
CY> 337.3 
3980 


8.684 5J303 1.707 0.700 1687 1.917 7.402 

64.18 55.71 15.39 6718 16195 18-40 71.06 

7,570 6.573 1.934 3793 1911 2.171 8J84 

Ven par 1809. Oorui Kroner, FrantJi Kruc, K cr uwg lnf i Kroner md S ra t r toh Kronor pv ID; p ap ran Franc, 

■ MMRK nnvm (IMM) UM l25flOOperDM ■ 


173.6 

1666 

196.8 


139.1 

1335 

1575 


Escudo. Ura md Pom par 


7J88 

7668 

91047 

10a 


1.428 

13.71 

1.617 


0.673 

6.460 

0.762 


1.353 

1258 

1.532 


1 

9.589 

1.133 


104 2 

100a 

178.0 


0.883 

wre 

l 


OMM) Yen 135 per Yan 100 



Open 

totes 

Change 

High 

Low 

Est vri 

Open Inf. 


Open 

Latest 

Chraige 

High 

Low 

Eat vd 

Open bit 

Mar 

05846 

0.50*0 

-00005 

0.5854 

0.5B22 

47572 

122680 

Mar 

0-9590 

03603 

+00051 

03623 

03558 

21.842 

89,888 

Jun 

0 581S 

05811 

-0.0002 

05830 

0.5790 

4.123 

13.066 

Jun 

0.9627 

09641 

♦00052 

0.9642 

03600 

2,2*7 

8368 

Sop 

" 

0.5785 

" 

" 

05780 

934 

845 

Sep 


09980 

" 

09680 

- 

108 

930 

■ SWSS FRANC FUTURES (IMM| SFr 125.000 por SFr 



■ STERLING FUTURES (WW) D52.500 per £ 




Mar 

o.rora 

0.7003 

. 

07008 

0.6972 

24,439 

*5557 

Mar 

1.4882 

1.4866 

-0.0010 

1.4886 

1.4830 

15335 

37,546 

Jun 

06998 

0.7002 

+0.0014 

07003 

0.6978 

1442 

5,799 

Jun 

1.4800 

1.4020 

-0.0008 

1.4838 

1.4794 

750 

3.080 

Sop 


0 7005 


0.7005 

05990 

5 

57 

Sep 

- 

1.4000 

- 

1.4800 

1.4760 

28 

447 

IMP 

PUBS 

■HRS 

mm 

— - 

----- 

- 

- 

Dec 

~ 

1.4770 

- 

1.4770 

1.4730 

1 

12 


15 


-5 

-14 

-14 

-15 


Etw cane* rates mt by Bra Eraoparar Cormsutan. Craranciai rao k» doararafcp icMre skengdi. 
P er w i iir ga tf rangao ara tar Ecu. a poatkra cMga danotn a wnak currmcy. Dkragmco I B ai the 
nato btnratn iw qradi the pqrcmtooi dflbranoa brteoan dwactu* rnakel md Ecu omtraJ rate 
Vj a omrey, md Ora napniin parnrRkad pkcvop dak&on d dra crmrq^l riMat aka livirt da 
Ecu care* rale. 

(17T9rt2) Sartnq md Mki Ura aummdad from BK Atbraknmt cteadted B» tm FkrancM Tima*. 
■ PMUADCmBA SB enOWTIONS £31250 {cents per pound) 


The Co-operaOiia Baok 
rate3ao.s nn i iii aai.img , tKMsacono 
TESSA (U5 . -I -Ivtadr 

water- rul e* 

.1*00 an I ioi I tea 
188-1 ary W tete tte i 

—Tsis 03* Uz|fr4Hte 

■22000-C4S3SS 1 4JB 238 I *U M« 

£10000434380— — I 400 3 00 I 404 4-1*1 

2.72 225 I wlMi 

Tog TM -km* At 

E5OO00*. 

eioono-c*2io_ 
nwmwi. 


J. Henry ScJwwter' 

1 20 CMnqlkd* Lanka E 


I* Co ltd 


201 1 27B 0-M 



3Wte« 


w , , 

225 244 | 228 4-HBl 
125 108 l 22tlfr4Bh 


21 t *ssd-ten 
208 230 206 B-40B 

£75 208 I 277 6-Mdt 

125 108 I 22llMrtl 

raiateMan-as95B 


WflateraTnatHtyk latent GWqBB tec 

pik tei e |t Otei .M| itemm 11 B7KJJ4I4I 
£15000* - [ «ffi 288 4*4 1 Qk 

i3.OTO-Cir.d90— — — J 4*0 238 *98 Ok 
II/U4UH-. 1 425 218 I 4**1 Ok 


"no- taw unraai tea u ten 

terkg matte p aa Ite iB K M IM 
Maehte rkWr^M tee riuteqfe 





MONEY RATES 


■ TKKHB B904CTH BIMMMK FUfURBS (UH'BT OMItn points ol 10094 


Strtee 

Price 

Mar 

- CALLS - 
Apr 

May 

Mar 

- PUTS — 
Apr 

May 

1/400 

• 046 

040 

048 

052 

057 

030 

1-425 

8.02 

018 

659 

053 

029 

088 

lAsa 

182 

4.15 

4.53 

008 

075 

128 

1-475 

1.62 

254 

299 

050 

138 

222 

1-600 

0.41 

157 

1.89 

1.79 

28S 

330 

1-525 

055 

088 

1.10 

084 

4.83 

5.19 


February 28 

Ovw 

One 

TYwa 

Sl» 

One 

Lomu. 

Os. 

Repo 


raght 

month 

filflo 

friths 

year 

biter. 

rale 

rate 

Belgium 

_ 

6ft 

6ft 

6H 

6'k 

7.40 

5.00 

_ 

woo* ago 

- 

6ft 

6ft 

0*4 

6ft 

7.40 

555 

- 

France 

OH 


61. 

O'* 

S* 

6.10 

- 

7.75 

week ago 

6H 

6»k 

6'. 

6ft 

5*4 

6.20 

_ 

7.75 

Germany 

u 65 

6.08 

532 

572 

542 

6.75 

5.25 

6.00 

«w«* 050 

0 08 

608 

5.85 

5.65 

5.37 

6.75 

5J5 

6.00 

Ireland 

Aft 

6ft 

8ft 

6ft 

Gft 

- 

- 

G.75 

week ffjo 

55 

6ft 

5 r i 

53 

5B 

- 

- 

6.75 

Italy 

81k 

8H 

8*4 

8ft 

8'- 

_ 

a oa 

8.92 

week ago 

«T« 

8H 

8ft 

B'< 

Ok* 

— 

8.00 

6.92 

Netherlands 

5 61 

5 51 

5.32 

552 

509 

- 

025 


ago 

S59 

5 51 

5.28 

5.13 

4.98 

- 

ajs 

re 

Switzerland 

4'. 

4'i 

4ft 

4*k 

4 

6.625 

4.00 

- 

ww* ago 

4H 

4'« 

41s 

4ft 

3'4 

8.625 

4.00 

re 

US 

J'k 

3ft 

3J 

33 

4ft 

- 

3.00 

- 

week ,i(jo 

3: 

Jft 

3!* 

33 

4ft 

- 

100 

re 

Japan 


2' 1 

2'» 

2*k 

2*4 

— 

1.75 

re 

week ago 

■1 « 
‘V 

2'« 

2ft 

S'.k 

2’k 

- 

1.75 


■ SUBOR FT London 








Intei bank Firing 

- 

3ft 

3*1 

4 

4ft 

- 


- 

neck aw 

- 

3ft 

J?s 

33 

4ft 

- 

re 

- 

US Dollar CDs 

re 

3.47 

3.81 

3.80 

4.18 

_ 

_ 

_ 

week ago 

- 

3 47 

3.42 

333 

3.96 

_ 

_ 

_ 

SDR Lkdiod Ds 

re 

3:* 

3% 

3'4 

4 

_ 

- 

_ 

week ago 

“ 

3‘. 

3*4 

M. 

3*4 

- 

- 

- 


£X21 LMrad D* odd ntMR i non. fl*». 3 mtha a 1 * d mdo i yeor SJ S LBOH tatarbarrh Img 
>xea m vTtorad rate ky Siffn qrml to Ora rneKal by 1 m rffaranen bank] at 11dm MCtr muq 
dn T»ra 6un»s eo Barium Traot Bank o I To»lra. Sorctarl and National Wa u mt u rar. 

Mra rdea nr abcmri tar ora drarra u n c Morra<r Koran. US 1 coa md SOR Uraad Oraraaka I 



Open 

Sen pr*» 

Change 

High 

Low 

ESL vol 

Open kit 

Mar 

94 21 

94 JO 

+0.01 

9425 

94.18 

20509 

175114 

Jun 

94.63 

94.82 

*0 02 

94.06 

94.60 

54478 

234576 

S«p 

94.84 

94 08 

♦0.05 

94.89 

94.83 

27929 

172087 

Doc 

94 89 

94.94 

*007 

94.99 

9429 

29445 

146037 

■ THRU MONTH EUROURA HTJUTI FUTURES (UFFE) 

11000m poeits ri 100% 


Open 

Sen price 

Change 

High 

Lore 

Est vol 

Open bit 

Met 

91 .65 

91.66 

*0.08 

91.88 

31 £1 

3833 

38185 

Jun 

91.87 

91.95 

*009 

91-98 

91.87 

6135 

57530 

Sep 

92.16 

9216 

*0.09 

92.17 

92.00 

2720 

23330 

Dec 

9225 

92.26 

*0.10 

9026 

92.18 

2145 

23141 

■ TWtSH 


■uro sans 

8 FRANC FUTURES (UFFE) SFrlm printed 100M 


Open 

Sen pnee 

Change 

Hie* 

Low 

Eat vol 

Open kit 

M» 

95-94 

95.95 

*0.04 

95.97 

85.92 

3599 

25885 

Jun 

96.12 

9011 

♦0.03 

98.14 

9009 

1720 

31160 

Sop 

96.19 

9820 

+0.06 

96.19 

96.17 

722 

'6893 

Dec 

96.16 

9620 

♦0.07 

96.16 

06.16 

60 

3708 

m TURKS MONTH ECU FUTURES (UFFE) Eeulm pokte of 100*4 



Open 

SeOpnca 

Change 


Low 

Est vol 

Open Ink 

Mar 

93.70 

9174 

*0.06 

9175 

93.70 

841 

11973 

Ain 

94.11 

94.14 

*0.06 

94.15 

94.11 

428 

10866 

Seo 

9431 

94.35 

+Q.09 

94.38 

3421 

304 

9675 

Doc 

94.45 

94.46 

+0.06 

94.47 

94.45 

377 

6508 


’ UFFE baoes tradu Ol APT 


■ 1KM8 880WT14 BUKOCOUAH |WMJ Sim poklts of 1004t 


EURO CURRENCY INTEREST RATES 

Feb 28 Sh«l 7 days One Three S« 

totfli notice month months months 


Ore 

year 


Belgian Franc 

6,‘i - 6,*. 

6\ - G>, 

BA - 8.4 

Bit - 6,1 

- au 

8,1 • 6A 

Darash Krone 

8‘« - 5'< 

au . e 

au - a 

6>1 - B,‘. 

a.i - sa 

6^ -5Sb 

D-ktari 

6 l i • SH 

6,*. - 8,1 

6,1 • 6, 1 . 

Si] - 5}j 

5U -5S 

S*2 -sh 

Dutch Gutter 

5.1 - 

5,*. - 5.1 

sij • su 

5.’. - 5,1 

5A - 5A 

5,1 - 4» 

french franc 

6i» • 8** 


6 •a - 6U 

6U - 6*1 

81,-8 

5^ - 5** 

Potajrjuew Esc 

10 ■ 

10 -91, 

10*b - 9? s 

10 - 9% 

9k ■ 9*2 

91 - 9>* 

Spans.*! Pocto 

6 V - Si*. 

04 - 0{i 

Oil - 8*b 

a*. - 8U 

a/. - au 

8.1 - 8.1 

Swing 

- 47 5 

S)i " 4|* 

sa-s& 

5,1 - 5,‘. 

5A - 5*e 

*>U - 5,1 

Sana Franc 

41, - 4J, 

4»J - ** 

4U - 4L 

4U -4U 

4.1 - 311 

3H - Til 

Can Dolls 

3ie - 3.1 

3?| - 3<2 

Wi-a 1 , 

4-3v 

4*4 ■ 4*8 

4%. 4I 2 

US Dolff 

3.; - 3,; 

3i ■ 3’* 

3% -ft*! 

3L - 

4-tfi 

4*1 ■ 4*4 

ttxan ua 

9- r», 

au - 7U 

aU - 7^ 

BU - 7’s 

8*1 • 71 

8*2 - au 

Vno 

7.; ■ 2«. 

2.’. - 2U 

2.1 - ?l a 

2U ■ 2,1 

rli - *& 

2*1 ■ 2.1 

Asran S3ff*a 

3», ■ 2»: 

3*2 - 2*2 

3*2 2*2 

4-3 

4-3 

4U - 3U 


Mm 

Jun 

Sep 

Dec 


Opon 
96^3 
95 85 
95.53 


Latest 

96^2 

8584 

95J2 


Change 

+001 

*0.0Z 

* 0 . 0 ? 


Ffigh Low 

9824 9921 

95.86 95.83 

95J54 9561 


Eat. vot Open kit 
62.802 324.077 

148230 433.944 
103,340 355.086 


■ US TREASURY 8U FUTURES (MAX) *1m per 100% 


Alar 

Jiet 

S4P 


98.60 

96.23 

95.96 


06.60 

9627 

95.97 


* 0.01 

-o.ee 

*0.02 


96.81 96.60 

9629 9626 

95.97 9536 


2, IBS 9,318 

2,955 24,836 

1^06 5,452 


*# Com in'jMvsi r^. n lor Fn»«ua a * t 

■ EUROttARK COTTONS (UFFE) DM1 m pQkdJ of 100% 


i»«i *1 ram ram am can tv dra IB Drior and V«* erttea had Qayi' note a 
• THMS MKMtH FtBOR FUTURES I.MATO Paw trtertsank offered t*a 


SM»e 

Pnce 

Mar 

~ CALLS - 
Jon 

Sep 

Mar 

— PUTS - 
Jim 

Sep 

9400 

021 

0 63 

0.S9 

0.01 

0.01 

003 

9425 

0.04 

0.41 

087 

0.09 

004 

006 

9450 

0-01 

022 

0.46 

0.31 

010 

0-10 


Est w* rauL cab i3SrO Puts 33S2 Pratous oafs opnn «. Cte 278974 Pin 1812*3 


Opnn 

Eenpnce 

Change 

mgn 

Law 

Est. wa 

Open wit 

Strike 


- CALLS - 



— PUTS - 


Mar 03-89 

93 89 

+O0I 

9383 

93.91 

11.760 

87,922 

Pnca 

Mv 

Jun 

Sep 

Mar 

Jun 

Sep 

Jri! 94 31 

94 33 

*002 

94.31 

94.36 

13.043 

74J57 

9575 

021 

0.J9 

051 

DOT 

0.03 

006 

Op 94.51 

W 55 

*005 

94.51 

94.57 

9.548 

43.748 

9600 

0.05 

0.10 

032 

010 

0.06 

012 

Dec 9464 

94.87 

*004 

94.64 

94.68 

7.W3 

28.659 

9829 

001 

0<K 

017 

0.31 

0-20 

022 

N TfeOCte MONTH EtmOCKllUR (UFFEl* Sim poinre of lOOte 



Est tci. oral. Cab IOC FWa 0. Previous ear's ran Cjb* 2 209 Pure KU 


Open 

Sett price 

Change 

f«ah 

Low 

Est. vol 

Open tm. 








ate 06 24 

96^4 

♦005 

9624 

9023 

75 

5705 








Jur 05.85 

95.85 

*0.02 

95.88 

95.84 

60 

4398 








Sop 

955* 

*004 

9552 

95SC 

5 

2242 








Dee 

9515 

*0.05 



0 

1476 









Ptewtu dte'l nuL Cadi 138,732 Pull «M6* . fter. <»8|r^ open ML. Cl 820JC4 Put! 35ft«17 


UK INTEREST RATES 


LONDON MONEY RATES 

Feb 28 Over- 7 days 

nigra notice 


One 


Three SDt 
months norths 


One 


Interbank Stateig 

6-4 

5*4- 4* 

5A - SA 

5A - 5,1 

5A-6A 

5U-5U 

Stating CDs 

- 

5*-5A 

5A-5A 

SA-sA 

5A-5A 

5*8 -5,1 

Treasury BAs 

- 

• 


4*1-4 h 

re 

- 

Bank Bis 

- 

• 

43-4^ 

4j|-4% 

43-4* 

- 

Local authority deps. 

4’i - 4(1 

5A-412 

6,1 - *il 

5*8-5 

5*8-5 

5A-SA 

Discount marine peps. 

8 - <U 

5,’, - 4]i 

* 

- 

• 

- 

UK cterang bank baas lendtog rate 5U par can horn Februrey 8. 1984 

Up to 1 1-3 3-8 fr8 

manti vnontfi wbbBw nuttv 

9-12 

mcrriha 







1 tijjiili V * Kti N t # i,’- iWl IT, 


38 DOVER STBEET.J-ONDONWIX3RB Mi 
TEL: 071 6291133 FAX- 071 4950022 


certs o< Tfflt dep. plOOJOO) 1'j 4 3\ 3% 

Cots oC Tra> dec. unde Cl 00.000 b Ibpc Oapen* iriMraan tor cate Ape. 

Ate. tandar rate of decotnt *71 2Bpc. ECCO tarid ran SDs- Eriprai Flnmoa. Mdra i» dagr Ftenary 2& 
IBM. Aareed rate tor pond Ale 20. 1«9*loAff 25. 180*. Seherrai 8 » B RfiOpe. IWra n c rate tar 
parted Feb 1. 1»4 to Feb 28. IK* Sctnnrai IV « V SIMpc. Fkmra Haute Bam Pate S>spo kom 
Me 1. 1S9* 

FUTVRCB (LIFFE) S300, 000 points of 100% 



Open 

Sett price 

Change 

rtsh 

Low 

EsL vol 

Open M. 

Mar 

94.62 

94.03 

+0 04 

94.83 

94.81 

6585 

89337 

Jun 

94.07 

94S2 

*009 

94S2 

94S7 

20186 

110807 

Sep 

94.70 

94.79 

+012 

94.79 

94,70 

10624 

66512 

Dec 

94.57 

94.64 

*0.11 

94.65 

9457 

10583 

103943 


Traded on APT. AM Opan kitemt flga. are lor premoui a ay 
■ SHORT STVRUMO OPTIOteS (UFFt) E500,fJ00 pom® at 103% 


Strfw 

Price 

Mar 

- CALLS - 
Jun 

Sep 

Mar 

PUTS 

Jun 

Sep 

9475 

0.10 

0J23 

024 

0.02 

o.oe 

0^0 

9300 

0.02 

009 

0.13 

019 

017 

034 

9325 

0 

OJ33 

0.06 

042 

0J8 

052 

Est vot BOL cm 8918 Pure X05 l Rrertoua bay's Opel tat, Ca*a 

101111 Puta 108704 



BASE LENDING RATES 


Adam & Company — S2S 

AfaoTrualBa* 525 

A)66ar* 525 

•Hanry Anabochar 525 

B3rt> al Banda — 525 

Bans Bfeoo vacaya.. W5 

BariKafCypua 525 

Bari, gf k^tand 525 

BariiOflnrfe 525 

Barit of SoaBnl 525 

todays Bw* - 52S 

MBkoChUEoat..- S2S 

•BtonrSHkjy 525 

CLBarttNedortand... 525 

OSrarftNA 525 

Ctydosdato Bark -525 

The Cthoperaftre Bra*. 5Z 

Corite & Co - 525 

Crate Cyonnaa 525 

Cyprus Kpriar Bar* .525 


% 

BtoS»n Law* 523 

Ext** Bonk Unfed-. 825 
Francis) * Gan Bei*_ 6 
•Robart Ftemkifl & Oo _ 525 

Giiobte* 525 

teOrimeasMteion -525 

Habb Bank AS Zrifei . 525 

ffente uk Barit -52 

Iterate & Gsn kwBfc 525 

•MSamuoL.- 525 

C. Hoar© 8 Co 525 

8, Shanghai. S25 
JlAanHodfeBaift...- 525 
«40paM Joseph & Sons S2S 

UoyifaBa* __52S 

Magtk^ Bate lid 525 

MdandBanfc 525 

* Uorid BanteiQ G 

N a t Wm eia a ter — S2S 

•flaateotm S2S 


• Rarbrighe B** LW a 
no longar awrurtsed as 

s turfing ireteu&on. 8 
Royal Bk riScofend _ 525 
•anti & VWknsn Secs . 525 

SbndterfQur&sed 525 

TSB - 52S 

«UhfedBfarKiwal- 52S 
UrtyTiuteBte* Rc_. 52S 

Western Tnri 525 

WhfetetpyLakfaw 525 

Vorksftte Barit 525 

• Members si Briflah 
MorchanV BanUng & 
Securitiea Houses 
i A nrrSg1k7n 

• tnptenqfeden 



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InuvKtinlPi nt.«l I (inmrnacCSmkte. tundanSIliWino 


7 PV- {f , Fore , casts ancl Market Myths for 1994 

Uc- Lr -'li □. vocr. df Gallon \v!if cc^finue. go?d -S most v^mrr.c- , .‘ : c 
v/on ! rise; Jspan s economy & slock market wi'J be weak. ' You ay ' 
f.Ol ira^ibct in FuHctMcocy - the 'ccncclc:tlc IrtvesimenT I ' o ■■ 

C - ! -r; u O 5l*.» r 0 ' C ci on Y ; or Chart Ar’oly - l y- 

' Sfrcc: Io-=o- w i s 7.-3. UK [ c - a cr- 7l-43v4541 

(On r JK>o- Fo-A 


FOREXIA FAX $ £ 

ao veaupubuc uccord of accurate shoiwte 


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V .” ' anunProtU FOTOGN EXCHAKOE FOHECAS1 

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a exchange rale specialists lor ove^Cyeare Fcx 371-43949.f i 

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•R'.r.nes Haase, 32 So^l-gdit Street Winchester, i 

:< Hs(TtsS023 9EH Faj 0424 77«67 










.FINANCIAL TIMES TUESDAY MARCH 1 1994 



INDICES 


U U FA 

2D ZS 24 


1883/4 

Htfi Lor 


FeC Feb Feb 

28 Z5 2* 


1993M 

(flgh Low 


1883(4 

BuuiXDa 

am low 

Ugh Lob 


EffHHl £9/12/77) 


M 20887.2 2228B2 2SOT4D 10094 1218758 8/3S3 FCJtoMWB 


M ,259639 239233 ZBBL17 8/2(9* 1504,15 25(2/83 


rm.-.Ty* 







k' 


SSL*™. »• ziwji aw aw. W.M “"SSJ" £• 2! £S SSS2 »S 

MMMvtinJBQ) 100EL4 «IJ 10Z3.1 1OU0 3/2(94 MUD 1»T(BJ CBS 41 tor (End ffi> 2S17 2800 SOM 2W®1 3LW MBfiD UflOT 

ST/BWnCWaW 44«B 44X54 449* «0B MW »» WUU 22443S 221U8 22B92B M9U4 S/W4 8l» 2ZM* 

Traded tataC/UUI) 115836 11B131 1168* 122225 1/ZS4 71MB 15/1/90 Wnm* ' 

™7 1 MDsqngpMO) 1211.10 neaoo 1190.43 1211.10 28fflfl4 tamzmm 

S^nn/911 151530 1501J5 148574 1B42JK 9®W T12546 4/1A3 PMfftaet 

ttrta Ctwp (2/U85) 288131 (fl 289527 330907 4/1/94 127008 4/1A3 

nmra eai2/BS M TOOBXQ 96600 1083000 ZV2W 71.47 4/1S3 Pw*Qd 

uwpKOMdW) m BW (1377} 31123 31133 31403 3B2BJW 18W94 16D&2B 1471IBS 

mm MfcWHTS U 3818.73 355522 3B3U3 1/2(94 2745*1 21/103 StagapOni 

niminni: t 0979 u 4 swjs 4320.12 mxo 1/2/94 sznao 21/103 ses *LOT*reOW79 goxjb 005,14 oixxi mun 4 /mm ntn i 3 /ias 

ftrtdto§Sj4f)03) U 206036 206516 218230 V2NA T72O07 21/103 s*B> Mika 

nj. J5E&M(2»BFnB 19B5flf 19083 1B335 238U0 4/UM 77550 5/1/93 

PBt Gwi (31/12(80) 94 4S341 45783 488730 4/2/04 201250 108/93 JSEMLpflWJq StBSff 58313 *355 B8223D 4/204 4S3SJB 10W93 

SSltf B3n i«> 40272 401.40 404.11 4BU9 2/»4 28130 4003 toaCn*B<4nfl0r 91B38 91876 832.15 97426 2094 60883 80(83 

££«L*8/12/90) 18793 18700 16729 HOMO 4/2/94 B4X1Q 22/1/93 Ku 5E (30/12*5) 3384B 33633 33778 35671 31/104 2030 4003 

Saocnnaw 151038 14fl431 1600.76 WBMO 2(2*4 T1H.1B 2*1*3 *«*art*o (1/2/37) 153890 1534* 15381 1*300 31/1/94 87910 28003 

{MC 4001/1207) 223806 219802 220839 28*93 2C/94 177231 29003 (AM 

- „ Swiss & M&fttm M 133876 133841 142334 31/104 90430 11/103 

SoteOUIZfiffl 00178 79733 804.11 85SJ7 4/104 98* 14/1/KS SBC 6w«4 (WOT) 94 102803 102850 108129 31/104 67870 11/1*3 

SioSSSiS) 2290.70 227850 229420 345607 4/104 «** 1«l« W*m 

DAX 00/12/87)1 209137 207432 209029 226739 3(104 1515W WISH yntfMFrf3Mffi6r 541434 539858 S7071 645452 8/1*4 308843 9/1/93 

„ „, rt| MM 

HtaMSaSUIZflQ 106822 108800 1064.73 119458 18/104 08772 5/103 ft»0a*SET DOM/75) 137233 tt 141954 T7SLT3 4/104 81884 10(93 

WsSnrm 1W1023 1010025 1043232 122BU* MW 543/30 4/103 25 CrmUm 1S0BJ M 161985 169Z7.1 2B88M0 13/104 386033 1/1/33 

BSE5m(1HS! <267-9 -C359 41383 40730 28(204 210067 2314(33 jEciJlri n (1/1/70)2 SOT OSLO 3193 84100 1/904 48850 13/1*3 


US INDICES 


DhJmh Feb Fab I 

25 24 


feOBWb 383878 383890 389138 39)838 324135 39)838 4172 

(31/104) (20n/B3) (31/104 (2/7/32) 

HHW Dunk 11098 18374 10423 10877 10X49 18877 MJO 

(10/109!) (11/103) (18/18/93} (1/10(81) 

Tnmnrl 17B29B 17837D 179873 188228 1*5X84 188229 1232 

02*4) (4/1195 (2fflM (W/33 

HUB 39841 30779 21058 26841 20779 25848 1050 

01/805 (24(2(54) 010(95 (8/4/32) 

DJ M. coy's Ngh WKW (3B88B2 ) Lew 9811.78 (382X88 ) {TlwarewBM 
Day's Moh SBSS.I0 (SSPITSB J Low S83UB <8837 47 / ftoutf# 

^endmi pxfl Psora 

CnnpBMGt 46008 4642B 47059 48200 429JB 48200 440 

000^ (9005 (2(2/94) (W32) 

MnffleHV 545X8 543J9 55ZJ05 53099 49048 58095 352 


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MSMOCrap 


4X92 4855 44X6 4840 3959 

ggggg WWW 

25X57 25775 381.13 287.71 23X21 

(2/2A4) (8/1/931 
46745 46X58 4717* 48799 39554 

(2(2(94) (a/1 (83) 
78378 77844 78817 89047 B4557 

(31/1/941 (26/4/83) 


FT 


Dow Jonas met Dfw. YfeU 


S 8 P l«t CSV. yfc*J 
S & P M. P/E hbJo 


Fab 18 Fob 11 Fab 4 Year ago 

2 JS0 2.58 2.62 £07 

Feb 23 Feb IB Feb 9 Year ego 

298 gJM hi k 2.55 

29J» 26.18 28.07 2S.51 


■ SDUtOflim /UP POOB8 BOO IWX R/TUtlES S500 timoa fcvfex 

Open Latest Change hB^i Law EslvqL Opwnbnt. 
Mar 4fiaas 467.7D 4-196 467SS 46B2S 6X222 174,483 


To: Gillian Han, Financial Timo (Europe) GmbH. NEbdungenplali 3. 0(1318 Franktm/Maio. Germany. 

TeJ. 49 Vi 156 850, Tlx. *16193. Fax. + 4« 60 596 44JL\ 
5* 

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YES, I would like lo robsoibc loihr Fkuneiil Times, and cojay my firs 12 nw» free. 1 will allow up to 21 days 
before debvety of my firs copy. Wcaje eawiny sutefriptia! for )2 morula x the foJioiing rare*. 

Auura OES 5900 Fhmoe FFR 2/MO Netherlands DFLK75 Sweden SEK 3^20 
Bd^imn BFR I3J00 Germany DM750 Norway NOK3J20 SwiKTtland SFR71P 

Denmark DKK 3X00 holy LIT 600.000 Pomipal ESC WI.OOO 

Fndand FMK2JOO Lvxonbouifi LJFR 13X00 Spain PTS 63.000 
Fwr oibtc7Tj^io»M in Turkey. Cyprus. Gmfce. MldU. pleate Ct»ibk.-1 <-322513 28 16. 

□ Bill I — l Charjc my American Eipress/Dinen dub/ 

me I — I Eurocand/Visa Accoum. Eaduv Date . 


SEK 3.220 
SFR710 


EurocanVVisa Accouhl 


Expiry Dale . 



Smmauia'waa swa s*75i razxz mm sum am snm SSstSSimoi 145843 144am uatn isttw 31/1/94 tons 13m 

jrarauwjmuwvj Bin TqMOO (ZftBOQ 124X67 1234.48 1 238X1 1311912(2(94 88228 13fl« 

mrnk tmfia aviM irous 51/1/93 JC»e»g»l91/l2S» M 33XBS 34X57 385.18 5/1/94 18802 4/1/83 

CEO QwnlU/l/W 1*M0 1823.48 «S48 «W !«.» « 17033 17175 «B 140M 9991 4(2(83 

SL Cam 111 fW73 €5ft3D ^.10 SS SSl ■ C9O40 STOCK HTOt wm»M (MATT) 

* ^ Open Sett Price Change Mgh Low EsL «L Open rnL 

198B7XD 19803X8 1875548 2114X11 13(9/93 WBX71 2flnV83 R* 2217 A 22240 +27A 2227 J) 2214J) 20588 11,333 

2SSSSS S »S 30X54 10/11/93 21X04 29/11® Mrr 222X0 22400 y42.0 22400 222X0 21.727 55.138 

OHEm™ iSS 160752 1D0X07 3M3 128008 2Srt«5 Apr 2237^ 22»J) -*41J SSB&O 2237 £ 235 1&e 

MSmUnWl m ”m M TIBOJn 217X45 239497 7»B3 M&J2 SBfUO ^ aguwt to pmvtoua **. 


□pen Maraat flpwea m to pnwtaua Hay. 

■ IM YOBK bCIWE STOCKS 

Frisky Stocks Ctee Ctonge 

kadad price an o« 

BP 4,730000 67K ** 

TtManm 4495X00 68H +W 

RJR Nsbteo 3930.700 7H +« 


■ -nuuuMQ Acmrnnf 

• Ugtona (aHao) 

Hi 25 Fab 24 Fab 23 
NW York S 27X218 341.615 309091 
Afflox 271216 1X214 1X563 


14(6 ^ 

Fad Mow zmm 61 M -l banes Tratod 2246 2,773 2,75* 

BoddMSn 2097,700 26K *V> FBses 1.162 438 951 

Oiysto XS88X00 55 K -K Mb 834 1520 1,165 

Mask 240X100 32U +« Ubdangad 652 517 638 

US Meat ^357X00 4» +itt NawIVm 48 38 78 

Gen tfotan 2X3X800 SOU -** New Lows 75 151 82 

• EatoWp tood* t mtkonwL p(ue LkMae. nwxW «xJ flarapottaitai. 

■ ■diMMiMMneB of the highoat and burnt pricoa reeched tkitofl Ota day by aadi 
bn (m**od by Tdetare) mptaaant da NghM and bmat v*ac Urn the nwt hna raachM 
» prmtoo dayH T GubjKt H aOeW laadeutaoarL 


Sttr raUAMAQ 112XB3 112411 114641 WU4X Sn/B* XUSX 13/W3 

■~i T> 1 , 1 .(-imi&u Bne atom of wtoflentw too 41 fttlnwy and I Comalen. ’C ttaka m m 10 JO OMT. 

sssiksrssx 


banes Tiaded 2j*e X773 2,75* 

FBaes 1.162 438 951 

MB 834 1420 1,185 

UkEhengad 652 517 638 

New H0» 48 38 78 

How Loms 75 151 82 


• CwTr-nrr mn wr rmh valid ft* thr ruannnr in k-(*« 7 i rfwnr ore 4sntnJ SM'unpiitm Pttcn <ar eorrrrt ji tbnr ,j/ 
jninp nr pmx. Prices me exeltuivt of VAT in all EC eetunirics except Germany amt France. FT l AT No. 
DEI/4ZHJIK. 

To subscribe u the FT bi North America contact New York Tel 7524500. Ftax 3082397, Far Em cuoiki Tokyo 
Td 52951711. Fn 32951 71 i 

□ Heme tick hen to mare infonnman atwta b and 2* month tnieenpurm nte, or raie> to 
1 aeaaaj not Hoed afvoae 

iFlrau sprnftl - ■ — - ... — . — — 


Comjwiy 

Addreu 10 orteeb I Maid bke my tisancud Train ddMered: 



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.M..r r3 i. I-*- I* «■ 
1 r urn e«|j ? 
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Mi rtitrr j, repfrd m)karf a lipunrr. 


Financial Times. Europe’s Business Newspaper. 


&<**' ,4 



























































40 


FINANCIAL TIMES TUESDAY 


4 ptnctose February 25 


NEW YORK STOCK EXCHANGE COMPOSITE PRICES 


1WM 

M* IniW 

IESb 11% MR 
29% 12$ ALUM a 
«?% 54%f W 
72% 55% AMR 
S 1% MX 
5ft 29% ASA 
30% 22H WML 
13% Mi «*Ufc 
15% 9$ Aqdncati 
38 25% ACE LM 

12% io% ACMGvttai i« ao 
10 % s%m 3 igmo»i an ao 
ift b$acheksbx an a? 

12% lO%«MGit5ii US 08 
12% ftACUUan* 1 0B 07 
9% ftACNHtatodr 072 8.1 
12% 7% Acne Or O.M 4.7 II 
11% 6% tam Beet 35 

27% 18% tank! 044 IX 13 
9% 6% ACM OJB 4517 
is 10% Aaron 91 

21% 17% AUssnBqir 038 20 0 
68% 45% M Han 100 5J 
32% 18% tom, 

»% 5%AmwQp 


fliW 

n» * c m u* in tan 

048 10528 325 10 15% 15% 

01B 1 2 35 112 15% 15% 10% 
in £6 22 3068 erf S3% 03% 
30 2188 64% 83% 63% 
15 333 4% 4% 4% 
zm 4.3 30 1043 46% 48% 48% 
075 2.B It 5BB9 28 27% 27% 
050 4.1 7 20 12% 12% 12% 
Z2 134 12 11% 12 

040 1-4 


Off 


4 b 


+® 

4 

+ixr 

*S 


Zb'S ZBil Z7 
8 % 8 % 8 % 
12 11% 11% 
17% 017% 17% 


... 50% BO 
3.00 140 01818 21% 21% 21 


. 14% *dn toe 
58% 41% Aegm ADR 
80% 43% Astral, 

M 24% Aflac x 

22% 16% Mmsn 

7% i% Mm me 
48% J7%AMtt 
38% iftAWmeFn 
20 9£Akgeanc 
16% <D% Abuses 
WC% lOTAtfMOIS 
18% UfaNaakaAtr 
19% 14% Hmr 18 
28% 20% AlfiCid) 

25% 17MQMA 
29% ZftAfcan 
25 16$ AfcnAJ 
58% 35% Alcoa 
X% IftAtottown 
17%«odU 
. 17 Alega LuC 

28% 23% AtagP 
29% 13 Man Con 

26% n$Attgan 
4% 2% ATkn 
77% >B% AklCaCM) 

to% a% a*»»o 

27% 16% Md kfcti 
61% 57%AldSg 
32% 23 HM Dp* 

7fa 3$ /Waste 
27% 17% Atonsi 
82 sa Alcoa 
47% Ift Mo Q> A 
12% 10% AmGurtK 
8 5% Am Prods 
10*2 6 AmnGd 

25% 15%/tocaStkri 
58% 42% AmtaHi 
10% 9% Am M) R 
31 14% An Bank* 

40% 28% AmBnd 
21% 14% Am BdUM 
31 21%AmBU3PlU 080 IS 14 
8% 7% Am Cap (re 085 8.9 


I 


848 27% Z7% 27% 

590 12% 12% 12' 

118 9 08% 8 

547 9% 0% 8 

220 11% tl% 11 
340 11% Tf 11 
302 8% 8% I. 

209 9% 0% 0% 

44 8% 8% 8% 

64 26% 20% 27 

185 " 

402 

132 17% . 

a 50% 50% »% 

0.18 24 TO 94 6% 6% ^ 

010 05133 130 20 10% 20 

123 23 11 87 52% 51% 52% *1% 

£76 4.6 11 4973 62% 59% 80 -2% 

0.40 1.4 12 1816 30% 29% ~ 

068 50 11 1192 17% 17% 

1 177 1% 1% 

092 t.fl a 1068 48% 47% 

050 05 22 1102 37% 3ft 37% 

38 255 22% 21% 21% 
154115 11 20 15% 15% 16% 

BIS 7.8 3 104 104 104 

020 1.2 B 858 17% 17 17% 

035 1.8 33 1883 n19% 18% 19% 

028 15 15 58 22% 22% 22% 

028 14 14 148 19*2 10% «" 

038 15 23 3224 29% 

OX 1J 43 5567 23% 

1X0 IXT* 2131 56 

OSS 2.1 4 801 28 

T.OO 4JJ 37 1634 20$ 

048 2.4 18 2892 20% 

1X4 65 12 7394 24% 

0.18 IX 12 1237 15% 

0.40 1.7 14 648 23% 

11 162 3% 

1.64 6X 25 425 23% 

0 IS IX 139 10% 

0X9 16 15 2 34% 34% 

1.18 IX 18 Z33fl 77% 7B% 

068 13 19 1093 27% 27% 27% 

18 192 4% 4% 4% 

8 (733 27% 26% 37 

1X0 2.1 SS 4810 78% 75% 75% 

41 3348 23 22% a% 

OXG 9.0 187 10% 1U r 

024 3 0 27 2462 n8% 7 

008 IX 5 9002 6% 

0X8 IX 17 » 25% 24 
060 IX 14 1 277 47% " 

045 4.6 121 9% 

006 OX 33 9068 25% 

1.97 19 10 3277 33% 

0X0 2X 12 15 17% 



1X4 02 33 
TXB 49 a 10 
1.75 19 24 3891 

iw 72 17 ton 

1X0 14 1211221 _ _ 

1.16 4J 23 1600 27% 26% 
077 90 100 B% dB% 

228 8.9 9 123 25% 25% 
OHO 12 11 165 10 16% 

292 4.9 12 4999 60% 59% 
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23% 14% MTMtatttr £06 
73% 43% wikrtpl 1X2 
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17 12% MIBm 0X0 
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32% 2S%WurkC 1X8 
9% 4% WttcmcSG £10 
32 ndWteax £84 

71} 8X0 VHs&ke £05 

9% 5% Wuknen 
79% 48% WttnDa 1.44 
13% 5%WknotB(n 
29% 24ttta£n 1X5 
38% 29mttfUdVk 1.7S 
34% 24 rifts Dup 1X0 

40% 23% MUX T 0X0 

35% 13%HfcMarine £16 

32% SO 1 ? ttuMb 1.1B 

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7 2% VMdccip 
46% 20%Hktey £40 

21 uwyeumr 0X8 
23% 15% IpnH £44 


22 lie 26% 25% 
6X 13 303 S% 28% 

14 1507 17% 18% 

30 II 1273 32% 31% 
17441 52 13% 13% 

53 1000 5% 5% 
IX 20 1279 41% 40% 
IX 17 477 34% 34 

£5 2710992 26% 28% 

09 11 154 4% 4% 

3X 30 1PZ7 B3% G3% 
59 20 310 18 17% 

54 (4 57 40% 30% 

44 9 117 24% 24 

1.7 10 43 246 244 

11 15 186 23% 22% 
3X 1 38 2% 2% 

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5X 28 505 39 38% 

M • 214 9% 9% 

17 15 73 25% 25 

3X 13 1083 9% 9% 
T9 17 348 21 20% 

19 17 7BD 138% 137% 1 
1 A 22 1135 17% 17% 
1X 17 52 25% » 

6 5 48% 46 

4.9 12 369 18 17% 

15 202 14% 14 

19 6837 1115% 14% 

07 23 307 30 29% 

1X128 72 20% 20% 

EX 11 1613 30% 030% 
IX 22 5632 14% 14% 
EX 0 414 5% 5% 

23 211 16% 15% 
22 5 437 18% 17% 
3X 44 500 34% 34% 
15 10 2894 47% 47% 
£3 21 4 SST 10% 10% 
IX 21 1352 6B% 67% 

23 IS 13 13 

19 18 1505 18% 15% 
» 10S 18% 19% 
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IX 17 216 8% B 

3.4 11 2580 34% 34% 
£7 14 26 B% 6% 

13 516 8% 6% 

18 15 1609 53% 53. 

70 118 12% 12% 

54 13 1330 25 24% 

02 11 761 29% 28% 

10 73 319 34% 33% 

14 28B547 34% 34% 
£5 20 143 34% 34% 
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£9 48 17% 17% 

3 315 B% 5% 
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1.4 22 126 20% 20% 
10 18 35 ZZ% 2t% 


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a 4.12 89 7 51%iB1% 

£58 13 19 375 44% 43% 
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7 523 1% 1% 
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£40 17 18 57 14% 14% 
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Beta Mx+Mdna e MM rimuMWtt «hu« wanw 
!««MiaotoaM|kHWMkrhH 


AMEX COMPOSITE PRICES 


4 pm dose February 28 


«* rngn 
AkrEwt 
Atflnloc 
Alpha kw 
Am ter Pa 
AmUfflza A 
Anted 
Am Eapl 
Ante-AmA 
ASRhw 
AsMach 
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AoasCMD 

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BadgartR 
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Barry RG 
BAT bid 
Beard 

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Brits Mon 
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Bowmar 
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n as 

Oh. E 10Bs ngh law Clm Dng 

102 92 n 12% 13 

0X0 13 99 20% 201s 20% -% 

2 8 1% 1% T% +J* 

13 1?1 3% 3.t 3% W* 

194 11 4 39% 39% 39% -1 

i £54990 12 20 19% 20 

0JS I 109* 5% 55 5% 

1 474 1A 1A 1A +% 

1 59 177 10% 10% 10% “% 

“j i s 1 1 i 

6 497 6*ji «% 6^ 

13 148 15^S 15b IS^S 

OS 1 2100 4 4 4 

£86 17 8 22% 22% 72h 

004 31 85 5% 5% S% +% 

17 238 17% 17% 17% -% 

0X9 12 331 7% J J% 

9 60 U2 111 IS 

£40 22 870 16 17% 17% 

£40159 9 22% 22% 22% 

39 105 13% 13{a 13% *% 

0X0 32 783 29% 29% -% 

300 5 9 9 B 

32 ™ 3A 3% 3% -A 

030 12 205U245 24% 24% +% 
104 14 30 13% 13% 13% 

1713*4 17% 17% 17% 

0 10 1% *% 1% ♦J* 

£20 14 33 23}; 23% 23*2 +% 

028 30 SO 11% JJ 11 , 

£01 B 353 4,5 4 4% ♦% 

B 13 4% 4 4% +f« 

32 150 22% 22 22% + 1 2 

2BB 71 5% 5% 5% 


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fY Sb 

m. E ions Mgo 
00*34 571 13% 
091 398 5% 

030 13 22 14% 
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£8*487 106 15% 
040 10 3 18% 

£40 14 43 16% 
£53 91 « 21% 

( 13 87 2,5 

10 10B % 

29 am ia% 

l 7 2 3% 

£48 58 19 11% 

040 18 22195% 
Ijzam SB 20 
£074254485 12% 
£28 12 9 W 

7 121 9% 
178840 39% 
4213236 3/ t 
9 495 16% 

0X4 12 15 35% 
3X0 15Z100 70% 
£20 14 3 11% 

£52 64 56 25% 

30 530 50% 

3 25 4% 

050 9 B3 29% 
£70 IB 770 26% 
an 36 235 17 

12 121 % 
35 52 8% 
£34 12 812 3>2 
38 445 6% 


Lae among 

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18% 10% J* 
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in 

35% K% 

70% 70% 

ni ii% . 

25% 25% +% 
49% 50% +% 
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28% 29% -% 
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P/ Stt 
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0X8 152075 
0 82 
3 313 
£15 52 7 

12 m 

17 IBS 

1 352 
£12 28 24 

32710 
.80 383 
£04 35 2278 


35% +% 
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8% 8% 
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16% 15% 
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13% 1& 
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35% +% 
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M 5b 

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Ohtex 0X4106 84flu32% 31% 31% +% 
Pegasus 5 £401072077 19% 10% 19% +% 
Plfil 0X0 48 101 11% 11% 11% , 

PattUP 1X8 32 3 23% 23ja 23% -% 

PM U) £23 19 1302 72% 71% 71% +% 

PlttrayA £50 18 171 34% 34% 34% +% 

Ply Gem ai2 32 1 038 24% 23% 24% •% 

PMC £95 18 H T6 15% IB +% 

PTOSkfiaA £10 1 32 2 l£ 13 -A 

Raaafted 32 3 30 |0 30 +% 

EteMCp 3 27 0% 8% 6% +% 

nedaEw 3 52 2% 2% 2% +% 


11 182 1 % 1 ft 1 % +% 

18 37 7 7 7 -% 

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IS 46 12% 12% lA +% 

7 22 25% 24% 24% -% 


24 846 
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12 108 
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£50399 2200 
£20 8 33 
122 8 
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23% 23% 
38% 37% 
26% 25 


23% 

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4 


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28 27% 
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SJWCup 110 10 35 39% 39% 39% -% 

SlMMui 31 330 34% 34% 34% +% 

SttfIB 0LM 12 1B4 11% 11 11% +% 

SUM 0 45 7% 7% 7% -% 

TIM 24 89 4% 3E 4% +,*» 

Tab Pratt* £20 50 11 9 9 9 

TteOBtt 0X4 67 653 45% 44% 45% +1% 

Thermedcs 58 1708 13 12% 12% , 

Tharmokm 34 220 32% 32 32% -% 

TUPNA £20 21 29Sirl5% 14% 15% +% 
TmnGrtiy 0304J 2% 2% 2% -% 
man 11 99 1% 1% i% +% 

Trim Mu 22 131 8% 8 B -% 

UaffcodsA 4 2 1% 1% 1% s 

UBfinaB 020 98 35 ifi IS 1H *A 

UaWMs 17 13 8% 8% 6% 

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Wtewtt 25 1488 10% 10% 10% +% 

Waaune 0X0 23 20 27% Z7 27% J* 

WSTx t.W a» 94 14% 14% T4% -% 

Wuihen £80 10 ® 22 % 21 % 22 % ♦% 

Xytnrtt 6 77 5% 5% 5% +% 


GET YOUR FT BY HAND DELIVERY 

IN DJURSHOLM. 




P *^rfAL TIMES--. 

—,w rl >r baltlv cnd> z&gg&Esm 


n Eh 

Suck Oh. E idfl Hpk tar Led She 

ABSMCS 020 21 288015% 14% 15% +% 

ACC Cup £12 82 454 20 19% 19% +% 

tottbiE 3J14B6 2B% 24% 25% +1% 
taw Mb 20 731 2**2 23% 24 +% 

Addon CD 32 192 22% 21% +% 

Adapucti 2oiift»u22% 20% 21% +1% 

ADCTria 31 1323 38% 37% 37% -I 

Addkvm no 67 18% 18 18% +% 

Ma SUV a £18152X95 76 25 28+1% 
Adobe Sya 020 235082 28% 29 29% +% 
AtenxG 11 389 15% 14% 15% A 
Adr logic 5 237 4% 4 4% +% 

AmPDtyn 91827 8% 6 0% +% 

AflfflHJft 34 387 16015% IS 

Mrarta 0X0 15 1885 30% 38% 30>2 +1% 
Aflyrnu 13 2280 18 17% 18+1% 

Agency Ra 23 287 13% 13% 13% +% 

AgteCa aim3i iB82 li% 11% n% +% 

AtaaADfi £78 2) IK* 5S% 55% 55% +% 

Aldus Cp 31 1049 22% 21* Z2% 

AftBW DJB 17 373 26% 25% 25% +% 
Alegliaw I51IES B% 7% 7% -% 

Ate) OKS 052 12 7100 30 30 30 

Attain 5 64 8% B% B% -% 

AAdCapS 1XO 12 14G 14% 13% 14% +% 

Add Cap £80 12 328 14% 14 14% +% 

Abate C £32 55 SO 5% S% 5% 

AOaGOU £06 3 218 1% lii 1% *h 

Mot CD 33 1233 33% 33% 33% +% 

Am Banker «0£8 B 727 23% 23% 23% +1,* 

AroOyBu 27x100 29 20 29 -% 

Am Maro« 18 208 19 1B% 19 +% 

Am lied B 221472 15% 14% 15% +% 

AfliSritra 0321 95 529 6% 5% 5% -% 

AmFrtrys 33 157 19% 19 18% +% 

AnfiflA* £50 161152 28% 27% 27% -% 
AmbdP 2 3798 1ft 13 l}{ 

Amarkne 0 1B2 % dft % 

AflMhi 2X0 B 27 52 51 52+2X1 
AmPnCoDi 50ED67u27% 2B% 26% 

Am Trar 11 2384 14% 13% 13% +% 

AmFttroT 1 989 % A A 

Amgen kic 1510735 *2% 40 41% +1% 

Anted) Cp DOB 439190 30l 2 29% 30% +% 

AimriTn 5 7B 10% 10 1 , 10% 

Anrioglc 16 117 16% 16% 16% +% 

Anriyata £48 12 79 1S%itl4% 14% -1 

AnengeUm 1X0 15 289 17% 17% 17% +% 
Mkw Cp 28 1240 50% 48% 49% -% 

Andros An 10 838 18% 17% 10% +1 

Apogee En £30 31 225 15% 14% 15% +% 

APPBta 10 2537 6 5% 5% •% 

AppU IM 32 6685 49% 47% 47>2 +% 

AppteC £4810410915 37 36 38% +% 

Appfetea 004 55 1837 22 20% 21% +% 

ArbuDr 024 44 102 19% 19% 19% +% 

ArckD 0X8 19 238 26% 25% 25% -% 

Atpanau 1X0 8 145 31% 30% 30% 

Armor Al* £64 21 560 21% 20% 21% +% 

Amridki 040 IB 58 21% 21 21 

ASX Grp 12 938 8% 8% 8% +% 

AspedTel 33 1150 36% 34% 38% +2 

ASSOcConui 637 591 25> 2 24 35% +% 

ASTRuch IB 9726 32 31% 31% -% 

Addasan 21 30 B B% 9 +% 

ASSEAkX £32 24 2148 34 32% 33 -% 

Aatte a« 23 6797 68% 57% 57»4 % 

Autririo 131150 4 3% 3% 

Ante 0X2 11 660 7% 6% 7% +% 


- B - 

BEI B (LOB IB 46 6% 8% 6% 
BOtagm 11 1093 13 11% 13 +1% 

BafcatiWr 475 ft d% H +Jr 

Briar J £06 13 2669 20 7 e 20% 20% +% 

BkwmLB 0X0 3 300 14% 14% 14% -1 

BrittrdM CUM 23 B85 IB 15% 15% 

Bactac IB 1085104% 23% 24% +% 

BnkSarih 044 101622u17% 17 17% -% 

EtenkemCp £40 9 124 18 17% 18 

Banknarth 080 11 iz 19% 19 19% +% 

ButettrariUO 28 528n33% 33% 33% 

Brilia Geo £52 18 17861)37% 88% 37% +% 
Baste F £80 16 246 30% 29% 29% -% 

Bay Wm £60 11 4 20% 20% 20% +% 

Baytwta 1.40 12 124u55% 55 55% 

mftTRnx 1X8 9 830 29% d29 29% +% 

BE Aero 2B 958 11% 11% 11% 

BeadttR 028 28 257 13 12% 12% -% 

Ban&JuTy IB 201 19% 18% 18% -% 

BeridayWR £40 13 450 36% 35% 35% -% 

BHIDp ai2 18 280 11 10% 11 

BHADp 38 n00 19% 18% 18% 

BIW 107 649 5% 5 5%+% 

BigB £12 161450 11% 11% 11% 
anrisyW £08 15 85 13% 13% 13% +% 

Bkwm 47 5125 44% 43 43% 

Btate 18 2520 10% 10% 10% +% 

Hock Dip x 1X4 12 82 34% 33% 34% -% 

BHCSofb* 225302 70 68% 88% +% 

BaTrcnS 1X4 9 2589 2B% 27% 26% +% 
Bob Brans £27 201098 22% 21 22% +% 
Boatt&B 12 239 24% 23% 24% +t% 

Butted 25 9BS8 14 12% 13% +1% 

Boston BkxOTG 6 361 38 36% 37 -% 

Button Tc 59 4498 Ul 3% 12% 13 

BradyWA £68 18 19 45 45 45 

Bnmco 0X019 331 8% 8% 8% -% 

BranoS 0X4 17 603 8 d7% 8 

BSBBncpx £76 7 31 23% 22 23% +1% 
BT Stopng £48 0 877 3ft 3% 3% 
BuMs 38 825 25% 25 25% 

BrittrfT 30 447 17% 17 17% +% 

Bumv&S 7 338 7% 7% 7% +ft 

Bwrbwn 25 55 7% 6% 7% +% 

Burinesfl B3 802 33% 33% 33% +% 

BadetWfl 7 19 27% 26% 27% +% 

Byw 7 4 6% 6% 8% 


- c - 

Cite IK 331 28% 27% ZB +% 

CoborMud 7 230 7 6% 7 

CsdSctepa 053 17 404 30% 30% 30% 
CadmusComOXO IB 17 u15 14% 15 +% 

Caere Cp 01 905 9% 6% 9% -% 

Crigatw 2X5 B 064 13% 12% 13% -% 

Cal Mcro 23 IBS 24% 23% 24% 

CanArtta 3 B12 2% 2}i 2% +ft 

CtetekL 1 100 3ft 3% 3ft -ft 

Cotfleo 0 17G 2% d2% 2ft -ft 

Canon kic 0X9113 113062% 81% 81% +2% 
Canaria 1 130 4% 4 4%-% 

Catted £12 ffi 144 48% 48% 46% 

CartmCm 0X4 23 138 28% 28% 28% +% 

Cascate 0X0 19 zlOO 20% 20% 20% +1% 

Careys £07 17 510 12% 11% 11% 

Crigena 8 221 7 B% 8% 

MMw 8 B98 19% 19% 19% +% 

cat CD a 1471112% 12 12% +% 

CentteTel 18G B52 5 4% 5 

Oentoctt 27130 10% 10% 10% 

CnblFld 1.12 11 856 30% 29% 29^2 -% 

CndlSpr 29 30 14% 13% 14% 

Ctunbr 13 396 U7% 6% 7% +% 

Charier) £48 B 2590 18% 18% 18% +% 
ChrmSh 009 18 8053 13% 12% 13 

Ondet 31 798 11% 10% 10% 

DteMtgn 33 488 6% 8% 0% +ft 

Orate) 15 208 11% 10% 10% 

Ctnodb 1 290 % d% % 

OwmimiMr 14 371 4% 3% 4 -% 

CUps&Te 81208 5% 5% 5% 

CNronCp 75 4536 78 75% 77% +1% 

OffllFta 1X6 12 244 55 54% 54% 

CWasCp £17 30 817 32 31% 31% +% 

QrnA^c 43 8971 40% 38 40% +1% 

CSTedi 1371138 2% d2% 2% +ft 

CbceSya 4017054 75 73 73% +% 

ClzBancp* 1X8 18 23 29% 29% 29% +X8 

CKteHbr 28 117 8% 8 8 -% 

ClOaOr 41Z100 12 12 12 +% 

Orihutm 13 279 6 7% 7% -% 

CKaCHafixlXO 20 116 32% 32 32% +1 

CUttEnay 1001090 5 4% 5 +% 

CodeNum 26 11 10% 10% 10% 

Cogm Cp 35 471 22% 21% 22% +% 

Cupar 9* 647 10% 10% 10% +% 

Coherent 15 480 13 12% 12% 

CBtepan 05 6406 23% 21% 23% +2% 
Cm Gas x 1X4 15 5 23% 22% 23% 

UUBrp 0X0 9 14 2B% 26 JB% +% 

Cunak £24 151042 23 22% 23 +% 

CmeatA K72S59B5 20% 19% 20% +1% 

CrocstASp £09 2519968 20% 1B% 20% +1 

CDnunfiKsttt&BD 11 IBS 32 31% 32+% 

Comma £70 98 193 16% 18% 18% +% 

COBWLdr 44 760 13% 13% 13% -% 

Comatm 51 68 11% 10% 11% 

CUMtutf 54 1908 4U 4ft 4% +% 

ConRap 1X8 31 1286 45% 45 45% ■+% 

CunSflim 13 S3 8% 8% 8% 

COOEM 1.44 17 952 10% 10% 10% +% 

CanuCri 22 260 17% 16% 16% -1 

MSm J4 48 3% 9% 9% +% 

CooraA £80 231483 18% 18% TB% +% 
CDpytota 1(0 422 11% 11% 11% -% 
Confe Q) 201021 48% 46 46% +1 

CUP Of A 30 5*51*13% «% 13% ♦% 

Cracker B £02 31 2B13 28% 25% 26% +% 

Cny Comp 0 970 2% 2 2 

Crwttr 1.12 IS 854 41% 41% 41% 

Cram Roe 6 588 6% 6% 8ft +ft 

Cytogui 3 459 5% 5% 5% -% 


- D - 

DSC Cm 3513664 55% 52% 54% +% 

Dart Groex £13103 2 82 82 82 -3 

DaaSted) 15 97 2% 2% 2% •% 

Datum a 96 7 8% 7 -% 

DetBMEK 15 Z75 18 15% 16 +% 


n Ita 

luck Htt. E Wta Hah Uw tut Cbhb 
Dauprmop 032 11 333 24 % 23% 23% '% 
Dab Shape £20 19 a 6% 6% 6% 

Detail En £32 22 69 14% 14 14% +% 

DHOUBetOaO 52 256 35 33% 35 +1% 

DriUcmpG £44 11 58 22% 2Z% 22% 

OdUConp 3316242 25% 24% 25 +7 2 

DettaQSm £18 19 60 18% 15 18% +% 

Dap Sty 1X0 7 17 28% d3> 28% 

Duran £20 4 08 7 % 7 7% +% 

OH Ted) 14 37 17% 17 17% +% 

Dams £72 101247 22% 21 21% -1% 

DWliB 18 446 19 18% 18% -% 

DtgMcro 9 17a 16% 17% 17% -ft 

ngsoum 7 702 2% z 2% +ft 

WgSytB 4 83 3% 03% 3% 

(None* CD 16 309 35% 34% 35% +% 

DbdaYm £20 25 207 10% 9% 10% 

DNAFttet 5 2595 5% 5 5 

Qatar Gn QXO 274C38 77% 25% 27+1% 

Dud) KOI £68 17 29 16 16 16 -% 

DracoEogy 7 502 11% dIO 10% -1% 

DreaBam 13 1*83 13% 12% 12% -% 
DreyGD 034 20 132 24% 23% 23% -% 

DrugEmpo 0X6 55 207 5% 5% 5% +% 

DS Bancor 1X9 14 296 24% 24 34% +% 

Duron aw a im 26% a a 

Omni £30 24 8U33% 32% 32% 

DymstyQ 0 5%%% 

Dyndcdi 131143 ia% 18% 19% 


-E- 

EagttW 10 160 7% 6% 0% 

Easel Cp 3 440 4% 4% 4% +% 

EauEmmtt 4 420 IjJ 1% lU +ft 

EQTri £18 31 2810 25% 24% 24% -% 

EOgheatf 78 573 s% 9 fl% +% 

B PaaB 2 266 2% 2% 2% +% 

BecttSd 131548 14 13% 13% 

Beam £82 50 71 50% 49% 49% +% 

OnrtAns 3010823 2B% 25 26 +% 

Emcuites a 113 8% 6% a% +% 

EnitexCp 27 1442 6% 6 6% 

Engyvitt* 54 196 15% IS 15% -% 

BterSw 87 ia 2% 2% 2% -ft 

Enron me 4 223 4% 4% 4% 

EndyOl £10 21 1S1 4% 4 4% 

Ericsson 048122 5415 44% *3% 44 +% 

Ebd a B% 0% 8% 

Evans Stt) 85 EG 19 18% 16% 

Exabyte 24 8931 18% 17% 18% +% 

ExcsBbur 14 217 12 11% 11% 

Bddeaac 12 02 17% 16% I74t +% 

Expmttl £10 22 1643 u!9 18l a 19 +% 

EroupAnr 25 137 15% 15 15% +% 


- F - 

FattGip 12 268 5% 5% 5% 

Far CP 024 16 a 8% 6*4 6% *% 

Fund £04 56 978 35% 35 35 -% 

FWM 17 380 29 28% 26% -% 

Fburies 1 594 4% to 3% -% 

FWiThrd 1X8 14 630 47% 47 47% +% 

nnyOII 10 319 5% 5% 5% +% 

RgpleA 0X4 261081 8% OB B% +% 
Ffiene) 331206 23% 22% 23% +% 

RdAttsma 1X0 101642 30% 30% 30% -% 

Fkri Am 0X4 B 454 31% 31% 31% +% 

FsTBcOriO £94 11 77 24% 23% 24% +% 

FutCdBk £55 17 120 19% 19% 19% -% 

FdSuay 1X4 114444 29 28 29 +% 

FstTttm 1X8 B 219 38% 38 38% •% 

Fstwesm £36 8 32 7% 7% 7% +% 

FdfadUZc 052 !0 010 22% 21% 22% -% 

RratkH 156 11 100 45 44% 45 +% 

Ftabidn 39 139 7% 6% 6% -ft 

Rserv 25 1576 20% 18% 20 •% 

Hariri 10 524 6% 8% 8% 

FoocLA 0X9 15 3415 5% 5% 5% +ft 

FandLB £006122187 B% 5% 6% +% 

Ftnmotf 1X9 11 736 34% 33% 34% +% 

Forsdmer 14 36 15% IS 15% +ij 

PttneBuc £30 52 17 31% 30% 31% +% 

four A 40 SB 3% 3% 3% -% 

FrihFti 1JM 111183 28% 26% 28% +2 
RsmariG ixB 9 28u*1% 40% 41% 
FCEnti 1.12517 54 u26 ®% 

RBfW 040 8 490 15% 14% 15>2 +% 

FsMflrri * 1.18 10 797 27 25% 26% +% 

Flriet KB £58 23 421 37 38 36% -% 

Muni £00 13 478 24% 23 24% +1% 

Film 024 22 139 17% 16% 17% +% 


- G - 

GRApp B 794 4% 4% 4% +% 

GSKSav 0X7 22 273 15 14 15 

Genka 0 191 3% 3% 3% +% 

Burnt Rs 20 13 5 4% 4% -% 

GeNCD £16150 29 B 5% 8 +ft 

Guam 25 1101 37%d34% 35% 

Girt Bind £40 16 3Z7 15% 15% 15% +% 

Guriyte 15 UB 4 3% 4 

WrataPh 6 1214 21% 20% 21 +% 

Gotta* Cp 4X0 431145 26% 24% 25% 
Brnnkc 7 522 4% 4% 4% -% 
ftnzym* 162714 2B% 27% 30^2 +% 

OrngriyM 20 4 10% 10% 10% 

GorityH 20 1178 18 15>4 15% 

(Um BX £40 141818U23% 22% 23% +% 
Qddhgl*£12 191040 25% 25 25%+% 
atari A £80 20 23B 1B% 17% 18% +% 

Bdi Horn 11 9 5% 5 5% 

Oral Guys 231802 17% 18% 17% +% 
GoridsPmp £80 23 2812 26% 25% 26% +1 

GndcoSys 43 18 2% 2% 2% +% 

Granto 0X0 76 299 23% 23 23 

GrtmAP 024 12 291)30% 19% 20% +% 
QnrdiPh 1 1266 1% 11%+% 

Groszroam 1 2004 4% 4% 4% +% 

GmdWb 737 424 15 14% 14% -% 

CTCUP » 9*7 21% 19% 20% +1 

OtKSvg 4 281 7% 7% 7% +% 


- H - 

Honteg A 84 3 9% 8% 9% +% 

Hartavyvl 0X4 10 488 27 25>2 27 +1% 

Harper Gp £20 151300 18% 16 16% +% 
no too 032 36 682 47% 48% 45% -% 

feetticar 22 344G 24% 24% 24>< +% 

HeaWcra 0X8 18 8*6 11% 10% 11% +% 

Heatthdyn 10 215 7% 8% 7 +% 

HariUri 10 51 6% 5% 8% +% 

Hadrtnger £16 22 4228013% 12% 13% +% 
NririiTnv 8 353 15% 15 15 -% 

HerbH 032 14 3853 21 % 20% 21 1* +% 
Hogan Sys 015 30 593 10% 9% 10% +% 

Hdoge 31 680 1*7% b% ail -ft 

HomeBari £78 9 7 21% 21% 21% +% 

Home Butr 0 406 5% 5% 5% +% 

Home Dice £72 25 251 id 20 20% 

HmeriySul 1 235 3ft 3ft 3% 

HgnMEir £44 21 I84u30% 2B% 29% 
Hunted. 16 912 15% 15% 15% -% 

HoseMes 044 23 3 5% 5% 5% 

Ha<£ 0X0 24 SSG 24% 23% 24% +% 

fkrtsrfiw 2 BS8 % ft % 

nntagm £60 9 816 22% 22% 22% +% 

Hum CD 0X8 0 140 3% 3 3 -% 

HridiTech 4562799 38% 34 38% +2% 

ftyorBto 19 100 5% 4% 5% +% 


- I - 

ffflSys 55 2 8% 8% 8% +% 

CFKs <75 277 4% 4% 4% 

BSCtoma 524l9lu1B% 17% 18 -% 

IS Intri 17 122 18 18% 18% -% 

ntuar 41 129 7 6% 7 

kntnunoQen 8 415 7 6% 6% +% 

kspedBc £40 ZB 54 14% 14% 14% +% 

MBmcp 1-16 IB 160 37 36% 36% -% 

kid ks £24 15 9 16% 15% 15% 

M Hu 31 5225 27% 25% 26-1% 

Hum* 2217362 24% 23% 23% +% 

taglBsHtt £68 17 200 12% 12% 1S% +^4 

KtegrOar 31 5725 2B% 25% 26+% 

H^dSys 29 7 12 12 12 +% 

ftgMHW 35 57 5% 5% 5% +% 

kite £20 1316628 69%d17% 68% +% 

kteB B 158 3% 3% 3% 

micyttEI 032 42 4003 24% 24% 24% +% 

ttrTtf 23 268 10% (0% 10% +% 
kterfceA £24 21 485 15% 15% 15% +% 

Hgph 31541 10% 9% 9% -% 

knuteri 16 302 7% 7 7 

Man** 245 829 12% 11% 12% 

Manoic 203828 11% 10% 11% 

MDakyOA 141191 17% 17 17 -% 

MB9E 0X6 21 2 3% 3% 3% -% 

kdTMt 656 605 11% 10% 11 -% 
mure 001 182904 27% 28% 27% -% 
Iomega Cp 2 817 2% d2% 2% +% 

ttcmedk W 1*9 18% 17% rt% ♦% 

MoYohado 130 42 4 u22B 228 229 +8% 


- J ■ 

JU Week 22 92 19% 1B% 19% +% 

Jranhc 020 22 WnM% 14% 14% 

JLEhd £10 23 295 » 25% 28% +% 

Jrimonw 81 6 24% 23% 24% 

Jones kri II 264 15% 15 15% +% 


Pf Ik 

Suck Be. E Um HDD Lar Lar Bug 

Jones Ifed £10 20 143 13% 13 13 -% 

JostynCpr 1X0 11 119 24 % 23% 24% +% 

JSBHn OSi 14 486 23% 23 23% 

Jpno Ltg 0X4 19 166 19% 18% 18% +% 

Jurin £16 11 948 14% 13% 14% *.1% 


- K- 

KSttBs £08 12 34 24% 23>2 2* •% 

rumsiCp £4* s 193 10 9% 10 +% 

KvriorC £00 38 317 13% 13% 13% 

KaytmnCp £40 14 452 24% 2X% 23% 

MfleyQl 06T 067 6% 8% 8% -% 

KcaySk OK 23 615 27% 26% 27% +% 

KenCetai o<4 11157 3% 3% 3% 
Kentucky ail 12 16 7% 7% 7% 

Hmhffl 0X4 17 53 30% 30 30% +% 

JOradTO 15 10 7% 7% 7% -% 

HAbtatt 52 36»u39»+ 38% 3B% +% 

KriMtadge 61906 12% 12 « % 

K09A 0 252 ft % J} 

Nuiaatnc 559114 tCS » 25 +( 

KufiriceS 8 1277 12% 12% 12% •% 


- L- 

Ladd Fum £12 S8 176 10% 9% 10 -% 

lrinRsd) <01295 36% 35% 36+% 

Lancaster 0X0 16 474 45 44% 44% -% 

Lanes Inc £S6 2i 201 22 21% 21% -% 

Laxtekfipb 37 1488 u30 28% » +% 

UnteES T6 4£l (2% m2 1 2 

Lxserstpe EG 85 6% 5% 0 

LadfceS 13 308 15% 14% 15% +% 

IswsonPr £48 201159 30 28% 28% -1% 

LOOS 337 4024 27** 27 27% 

LOGS £16 9 2Q 7% 6% 5% -% 

UCMSro 17 408 14% 13% 14 -% 

legem Cp 1511236 26 24% 25% -% 

LfltyMBc £78 14 128 30 29% 29% -% 

Ute Tech 0X015 15 17% 16% 17 -% 

Ltfetttp 21 10 4 4 4 

URylndA £40 23 97 25 24% 25 

LhBr 94 674111% 111111% +1; 

Lmcrinl 052 IB 516 19% 1B% 19 -% 

UndsayM 14 14 32% 32% 32% 

unearTec 0X4 36 1707 45 « 44 -% 

UtyAat £40 is 17 37% £ 37% +1% 

uamnGp axBtsiiai 25 % m% 25% +% 
lone SO 11 471 0% 8 6% 

lutu&D 58 6118 69% 58% 691; +1 

LTYCp 29 1367 4% 3% 4% +% 

LVUH 3X3 IB 20 137% 136*137% +4% 


- Ra- 
in Cm 0X5 2436237 27% 26% 27% +% 

US Car's 2210M 26% 25% 25% -% 

llac MU 0X0 54 514 17% 17 17% *% 

MartsuriX *1X6 13 52 31% 31 31 

HapnaPWr 141273 32 31% 31% -% 

Magna Grp £76 12 187 19% 19 19% 

lb) Bo* 16 622 10% (fi% 10 

UanttWK 1X0 35 2B3l»3l% 30% 31% 
Manan Cp 35 778 12% 12 12% -% 

Katie Dr 75610) 5% 5% 5% +% 

ttrtdCp 10 14 44 43% 44 +% 

Uanniest 0 184 2% 1* 1% -% 
Manuna 17 682 8 7% 8 +% 

HrsftSmkA£44 11 9 11% 11% 11% +% 

Mantas * £56 11 375 21% 2131% +% 

UasttnH 40 4041153% 52% 52% +% 
Maxtor Cp 03382 6% 5% 6% +% 

MeOaffiR £« 12 27V 16% 15 18% + ] 4 

UcCooric £48 17 4022 21% 2121% +% 

UcCmC 44 3486 50% 50 50>4 

Met) bag 0 *02 fi II 0 it 
Medax ku £18 24 2246 18 18(2 18% 

MbQiukS £48 13 183 23% 22% 23% +% 
Mriamkr £24 5 17 5% 5>4 5% 
UrittuCp £18 51 328 IB 15% 15% 
MankG 0X4 192883 13% 13% 13% +% 
MutantB £68 '10 100 18% 10% 18% +% 
UmayG £70 8 523 29% 28% 28% -% 
Mutton IXB 101213 27% 27% 27% 
Mattel 21 70371)21% 20% 21 +% 

MathofeA 006 17 1D3ui7% 18% 17 +% 

MfcnaelF £20 38 269 11 10% 10*2 -% 

MdittaS 2X029615221)65% 63 65% +1% 

MQrifSl 14 117 6% 5% 6% +% 
Menage 20 929 27 26% 26% +% 

Marram 3 468 5% 5% 5% -% 
Hcrgraft W 488 10% 9% 10% +% 
Mapato 31341 5%d4% 5%-+% 

Mcstt 2417059 83 81 82% +1% 

IM AIM 31 3298 35% 34% 35% +1% 
MKfanW 1X0 11 2187 27% 27% 27% +% 
MdnGtrin 060 25 32 30% 30 30>a 

MtorH £52 241128 34% 33% 33% -1% 
mam 18 148 25% 25% 25% 
Muted) 15 262 12 10% 11% -% 

MHttteTri 43 9393 17% 16% 17% +% 
Mattel Co 0X0 21 20 9 8% B% -% 

UUteBWx£« 19 155 28 27% 27% -% 

Main £03 1455 34 33% 34 +% 

Mate* toe £0*28 391 38 35% 35% -% 

Mason £0*15 101 9% 9% 9% -% 
MtaneeP 038 23 92 31% 30 31 -% 
MCdTee 17 455 14% 14% 14% -% 
MISSys £56 13 34 32% 31 32+1% 

Uttmed 14 914 31% 30% 31% +% 

Ktycogan 4 222 11 10% II +* 2 


- N - 

NAG He £16 12 90 29% 79% 29% +% 

NariiFndi £7211 327 17% 16% 17% +% 

Ha Pizza 14 29 6% 6 6 

NriCompr £36 15 196 13% 13% 13% +% 

Kd Data £44 2412919 19 16 18% 

MnSU) 0X0 22 30! 14% 14% 14% +% 

Mn«ak)r II 210 21 19 21 +% 

ICC £46 94 53 50% 50 50%+% 

Neteor 18 2864 W% a 29 +% 

NeMGen 33433 21 20% 20% +% 

MnrtS 124 55! 8% 6% 8% 

Nuangm a 3 7% 7% 7% 

NDgre 0X7 M 2019 Z0% 19% 19% -% 

Heart 0U5 £80 23 892 20% 19% 20% +% 

MMknbb 10 815 13% 12% 12% -% 

Matoteri 42 9104 58% 56 57% +1% 

Newpri Cp £04 62 14 6 5% 5% 

MobteDft 25 2838 6% 7% B% +% 
NonttUix £58 » 84 57 56 56 -ft 

Ndnrm 034 22 5734 39% 38% 39 

HoroUnl 12 17 17% 18% 16% 

N Stalin 95 MO 5% 5ft 5% +% 

Nudnld £88 14 1233 43% 42% 42% -% 

Nwel 28326611 26% 25% 25% -% 
Monetae 38 1292 43% 42% 42% -% 

NSC CDrp ID 106 4% 4,1 *% -% 


- o - 

OOwteys 23 140 14i 2 14 14% +% 

Octal Com 22 Til a 28»2 28% ■% 

QRahroLg 15 736 14% 14% 14% 

OgttayN 1180 B 6 24% Z4% z*% +% 

QhteCa* 292 13 895 63% 63 83%+% 

OH Kent 1.16 91024 31% 30% 30% +% 
DUMB* £92 16 105 38% 38% 36% 

Onancup UB 7 9i 31% 31 31% +% 

One Pita 17 325 22 20% 22 +% 

Opttcid R 19 204 20% a 20% +% 

OradeS 4813456 33% 32% 33 +% 

OTO Senes 42 1358 16% 18% 16% +% 

Odxxedi 099 31 212 11% 11 11% +% 

OreMSopp 10 157 15 14% 15 +% 

OregonMK 031 16 416 6% 5% 6% +% 

Orite) B S7 4% 4% 4% +% 

OanUA £41 47 487 1 6*2 H% <4% ->2 

OsMaadiT OW 11 92 11 10% 10% 

OBuTril 1.72 14 48 31% 31 31% 


-p-a- 

Patxar 1X0 151435 58% 56% S8% +1% 
PtacOuttop 057 14 303 15% 15% 15% +% 
PTriOT 1X2 17 28 25% 24% S% +% 
PtefflCra 21 4 10 53% 50% SI S 

PBramSTC 38 8075 33% 31% 33+1% 

Paychex OX* 48 355 39% 38 3B 

PaycoAm X* 5 8% 9% 8% -% 

fterien OSH 46 32 10% IO 7 * 10% +% 

Pamirty 8 75 14% 13% 13% -% 

PgmWrgx 1X0 27 28 37% 35 37%+% 

Panrytt.x 2X0 18 80 32 31% 32 +% 

Pert* £72 15 97 38% 36 38 -% 

Periacbl 16 444 6% a «% 

Panama L £3t 25 15 22% 21% 22% +% 

PtOp Bat IMIS 4u*9% 49 49% +% 
People M 080 97 174 40% 40% 40% 
Peoples H 10 W9 10% io% 10% 
Prirotte 1.12 18 153 34 31% 33% +% 

nrrmaey 21 fi 7 7 7 +% 

nnentlch 251269 5 4% 5 +% 

Recall 048 5 GO 14% 14% 14% -% 

PUBES 31 2467 15 14% 14% +% 

FkAEnon 5* 246 21% 20% 21% +% 
RonaerGpxWBZI BIS 32 30% 31% +% 
PtawrtB £5B 25 1507 37% 36% 36% -% 
PUtmS! 014 H 494 1)28 24% 25% +% 
Para Fed 5 49 B% 8>< 8% -% 

Pouri 18 270 7% 6% 8% -% 

Pres Ufa 009 31257 7% 8% 7% -% 


» Ita 

Stock Dta. E 1«ta tttte ter ur cup 
Presort. 113 1080 31% 30% 30% +% 
priori 301205* 20% 19% 20 +4 
Pride Pet 45 1468 5 5% 5% -% 

Pnmronl 15 92 8% 8% 6% +% 

Prod Ops 0X4 24 100 27% 27% 27% -% 

PtatedU 101 14 481 50% 49% 50% 

PUtrilB £12 16 755 20 19% 20 +% 

Pyramid 30 443 14% 13% 14 +% 

OuskaLog 10 113 6% dE 1 * 6% 

Undrawn £62 88 33 16% 16 16% 

Quri Fad 0X0 17 404 23*; 22% 23% +1% 

Oaten 761E2J0 77% 15 16% .% 

Odd ritt 20 438 14% 14 14% +% 

WC New* 317149 46*2 44% 46+1% 


- R - 

Runuw IB Gt* 20% 19*2 19% -% 

Mys 15 5G3 10% 10% 10% 

Rasterope 3 1065 8 7% 7% •% 

Raymond 23 3 17% 17% 17% +1 

Retrial 27 434 30 29 26% -% 

ReLfD A 17 770 10% 18% 18% -I 

Rarigen 4 320 6% 0>4 6% -% 

Rtp Waste 5 333 3% 3% 3% +,'» 

RBridttnd 19 377 11% 11 11% -% 

Reuurj 2.17 323501 B0% 69% +% 

team me 14735 6 5% 6 +% 

RtVETFst 056 It 24 37>4 36% 37U *% 

ItoaMS 1.40 23 534 70% 69% 70% +% 

RbNgnl £12 16 62 7% H7% 7% -% 

RachSvSk OLSfi 3 730 1&% 15?| 16% +% 

Ro omen 1X0 0 238 46 45% 45% *% 

Hass Sir £20 11 1290 14% 14% 14% -% 

RttechMed 27 721 23% 21% 21% 

Ruse £» 75 335 18% 17% IB 

JVWK. 052 21 1105 U19% 18% 19% -% 

RSRn 0.48 12 8 20 19% 20 +% 

RyanFiriy 14 S61 7% 7% 7% -% 


- s- 

Suaco 1X0 B 1057 57% 57% 57% 
Sandera*) 030 12 31 16% 16% 1b 1 * +% 

ScnbnPgrA £38 25 148* 35% 34% 34% -1% 

SdMedL 9 1570 36% 35% 35% -% 

SOSystm 15 2323 IS 1 * 16% 19 *% 

Sdte B 090 8% 8 8% +% 

scm cp as 12 551 26 »% 2s% ^ 

Score Bn) 16 706 1 5 14% 14% *% 

SaaMrid 120 45 49 38 37% 37% +% 

Fade 111BD59 25% 24% 25% .% 

SB CP £12 31 30 25% 34% 24% 

Stans B 038 0 477 1% 1% 1% -ft 

SriecttKi 1.12 17 39 29% 26% 29% 

Srauerd 56 3127 15 14% 14% 

Sequoia 40 731 6ft G 6 -ft 

Sen Turn 1* 34 10% at* 9% ->4 

Senfraa 16 32 3% 3% 3% -% 

Sevtrcai 10 5 18 IB 18 

SteMed 0X4 19 2330 26% 26% 26% +% 

SHLSystro B9 738 7% 8% 7% +% 

Shu mood 27 453 15% 16 16% +% 

SnmTOCP 14 478 15% 14% IS +% 

Siena On 23 1579 32% 28% 30-1% 

iSternTne 3 28 4% 3% 3% 

SrgmAU £33 23 1021 51% 50% 50% -% 
StgmaDeg 2 450 13% 12% 13% +% 
SKllUBc £06 *G 263 9% 9% 8% -% 

SilcnVGp 321553 11% 1111% -% 

SfcDfBOD £56 27 53 £2% 21% 22 +% 

SmttttOd 29 204 21% 21% 21% +% 

SnapgieBv 78 7542 2^4 27% 29+1% 

SoBvrraP 29793 6% 5% 6% -% 

SdteweT 5)3314 8% 9% 9% •% 

Sunoco 0X4 18 1840 25% 24% 25% +t 2 
SudhBlx £68 9 545 19% 18% 18% -% 
SpbfiriA £20 44 B3 21 20>2 21 

St JudeAM £4D 124500 28% 28 aM 2 +% 

SJPauBc £30 0 564 19 1B>2 19 +% 

stagies 47B929u31% 29 30% +1% 

G&rBanc UB ID 181 38 35% 36 +% 

State Sc £66 151636 37% 37% 37% -% 

StdMtro 13 1686 1 9% 1B% 19% +% 

SURegta 068 15 378 22% 22 22% J4 

Steel Tec OuOB 23 238 20% 19% 20% +% 

SuMytlSA £20 2 970 7% 7% 7% -% 

SteON 166 2*9 23% S3 23% +% 

Strartxa 1.10 14 193 22% 22 22% 

S&fldDy 30 3256 15% 14% 14% 

soykar 026 28 3144 33% 32 32% +% 

SuUvanD 28 337 19% 18% 18% -% 

SUDtnwB 0X0 73 384 21%tCO>2 20% -1% 
Sums Be £84 13 311 21% 19% 20 1 * +% 

SwnmllTe 108 906 34 % 33% 33% +% 

Sun Sport 17 12 7 8% 7 +% 

SunMc 14 9628 Z7% 27% 27% -% 

SuriBTia 26 S59U2B% 25% 25% -% 

Sybase Ik 529152 48 43% 45% +2 

Symantec 252917 14 13% 13% +% 

Syratoy 038 18 317 18 17% 18 +% 

Synarcom 57 390 3ft 2% 2% -ii 

Synargen 3 700 12% 11% 12 +% 

Syndic 44 11 10% 10% 10% 

Synoptics 2311636 26 25% 25% -% 

Orrimsoit ai2 19 n74 17^2 16% te% +% 
SyriunBai 32 418 19% 19% 19% +% 
Sysfflnaed 5121075 5% 4% 5% •% 


-T + 

I T-CeMSc 9 701 5% 5% 5% ■% 

TjmaePr 0X2 19 311 31% 30% 31% 
ITBCCp IB 562 13% 13% 13% +% 
TCA Cable £44 30 330 25% 25% 25% ■% 

TechOutt 24 859 38 37 37% +% 

TBCuroseh £80 15 328 57% 58 57% +% 

Tekriac 1 60 8 7 1 * 7% -% 

TeteoSys 5 133 S% 9% 6 1 * ■% 

TebCommA 29530611 24% Z3% 23% -% 

Tried) 13 3188 11% 10% 10% -% 

Trans 38 1834 53% 53 53% 

Tetton CD £01 14 478 13% 13% 13% +% 

TemTars 63 951 7% 7% 7% +% 

TavnPhADR £20 34 5447 33% 33% 33% 

Three CDm 2812528 60% 57% 60% +2% 
TJ Id 0X2 41 558 27% 26% 27% +% 
Tokos Med 52079 3% rO% 3% -% 

Tokyo Mv £37 36 2 64% 64% B4% +% 

Tom Brown 61 64 12 11% 11% -% 

Tapps CD 02B3B21565 7% 7% 7% +% 

Tn Enter 4 2263 B% 7% B% +% 

Tnmrid 12 25 13% 13% 13% 

Trernkk 0X8 0 1B2 34%d33% 33% -% 

Tltcera 25 108 3ft 2% 3ft -ft 

Trimble 52 256 1 0% 9% 10 -% 

TruMsBNCXIXO 11 298 21% 21 21% +1 

Tseng Ld> 0X0 182140 10% ID IO 1 * +% 

TysRM 0X6 17 5690 21% 21% 21% +% 


- 11 - 

USHbhn £60 23 8584 54% 62% 63% +% 

UnBab 2 315 6 5% 5% 

UCkfeaCte 1X0 14 108 17% 18% 17% 

USTs* 2X0 It 40 51 50% 50% +% 

UntodSt £40 11 222 13*4 12% 13% +% 

Unttog £20 20 41U2S% 25% 25% +% 

Uritrfcr 1.40 22 470 41% 40% 41% +% 

USBoncp 0X9 102834 27% 2S>2 2^2 -% 

US Energy 2B 10 4 4 4 

LET COTO 1.12 8 48« 12*8 12% 12% +% 

UK*! Mad 12 379 7% 7% 7% +% 

UdTstav 9 13 42 41% 4Z 

Uto 21 186 6% 6% 6% +% 


- V - 

Vaknort £30 40 50 18% 17% 18% +% 

vngrocett 51 IBS 31 SO 1 * 31 +% 

Verttmu 21 1E04 io 1 * 18% 10% 

vrar 43 2207 u20 20> 2 27% +1% 

WtupHri 12 263 20% 10% 20 -% 

Uogic 35 1130 20% 27% 28 +% 

VLSTadr 30 4853 13I2 «% 1^2 +% 

tool 1X4 15 134 B2% Bl% 82% -% 


- w- 

WuncsEn £12 22 340 30% 28% 29 -% 

Watmteefl 88 201 5% 5% 5ft 
WSriikUSS Q£4 83634 22% 21% 22 

WtotftdSLOXB 9 1528 22 21% 22 

WmskaJA £44 23 120 57 56% 57 +% 

HbOUPMOX* 18 832 30 29% 29% -% 

»45 2X0 IB S3 43% M3 43% +% 

wore* 44 865 8% B 8 
Wad One £72 10 455 27 26% 26% +% 

TBtPub 11 1045 18% 17% 17% -% 
WdSeriA 41 60 3% 3% 3% 
WlntDX 096 281250 58 55% 57% +% 

WraGuma 832573 029 28% 28+1% 
Whs Ok £40253 88 17% 17% 17% 
WtttdanLitUB 14 ea 1&% 13% 18% *% 
Wtengl 036 251130 20 19 19% 

IffPSrat* 0X3 23 488 3,'S 3% 3ft +ft 
Wyman-Stmoxo 81841 8% 8% 6% -% 


-X-Y-Z - 

Hka 352792 u55 S3 54% +1% 

XomaCorp 31S27 4% rW% 4 1 ; +% 

y«few ok 431633 2920% 29 +% 

YtrtRsdl 50 B34 4£ 04% 4ft •% 
ZkraUBh 1.12 9 42 39 37% 38% -% 


\ -a « 





42 


WORLD STOCK MARKETS 


FINANCIAL TIMES 


Tuesday March 1 1994 


AMERICA 




Stable Treasury bonds 
support US stocks 


UBS falls 4% on brokers’ downgrades 


Wall Street 

After last week's losses in bond 
and stock markets, stable Trea- 
sury bonds helped US share 
prices post solid early gains 
yesterday morning, unites Pat- 
rick ffarvcrson in New York. 

By I pm. the Dow Jones 
Industrial Average was up 
11.82 at 3.850.60. The more 
broadly based Standard & 
Poor's 500 was also firmer at 
the halfway mark, up 2.90 at 
46S.97. The American Stock 
Exchange composite index 
improved 2.67 to 259.96 and the 
Nasdaq composite advanced 
5.88 to 789,66. Trading volume 
on the New York SE was 153m 
shares by 1 pm. 

Trading opened against the 
backdrop of disturbing news 
from Bosnia, where US fighters 
were reported to have shot 
down four Bosnian airplanes 
which had been violating the 
UN’s no-fly zone. 

Although conflict between 
Bosnian and US and UN forces 
In the former Yugoslavia 
would have little direct impact 
on financial markets In Europe 
or the US. the prospect of the 


ASIA PACIFIC 


US and its allies becoming 
involved in a prolongued mili- 
tary action in the region would 
not be good for stock market 
wpnttmpnt- , which Las already 
been rattled by rising interest 
rates in US and international 
bond markets and by upheav- 
als in global currency 

Once trading opened, how- 
ever, it was dear that the mar- 
ket was willing to ignore the 
situation in Bosnia, at least for 
now. Investors were reassured 
that the downing of Bosnia jets 
did not immediately escalate 
into further conflict 

The market received a fur- 
ther boost when US bond 
prices edged higher during the 
morning session, buoyed by a 
February Chicago purchasing 
managers' report which 
showed defining prices in the 
region and a downturn In the 
local employment market By 
early afternoon the benchmark 
30-year bond was up V* at 94&. 
and the yield had dropped to 
6.687 per cent 

Kmart edged forward %'/» to 
S19 1 /* in spite of the fact that 
the big retailer reported a loss 
of $974m, including large 
restructuring charges for the 


fiscal year to the end of Janu- 
ary. 1994. The stock held its 
own on the news because the 
bad news had already been dis- 
counted by the market, and the 
share prices was already trad- 
ing at its 52- week low. 

Tobacco stocks were notably 
weaker. RJH Nabsico fell 
another to $8% in volume of 
2m shares as investors contin- 
ued to react negatively to last 
week's announcement of plans 
for a $2bn share offering by the 
big tobacco and food group. 
Philip Morris, meanwhile, 
dropped $1% to $56% in volume 
of l^m shares. 

On the American Stock 
Rvrhang P j the "B" shares in 
Viacom rase $2% to $28% after 
the entertainment group 
reported annual net income of 
$155m and a big advance in 
subsribers to its MTV Europe 

rhannri 


Canada 

Toronto was sharply higher by 
midday, the TSE 300 composite 
index adding 4551 or LI per 
cent to 4.410.04 in moderate 
volume of 25.2m shares. 


HSBC lifts Hang Seng 
index 3%, Nikkei firm 


Tokyo 

Active buying by foreign inves- 
tors pushed share prices 
higher, and the Nikkei average 
briefly recovered the 20,000 
technical resistance level 
before losing some of its gain 
on profit-taking, writes Emiko 
Teractmo in Tokyo. 

The Nikkei 22S average fin- 
ished 193.82 up at 19,997.20 
after opening at a day's low of 
19,848.58 and peaking at 
20,11751 in the morning. For- 
eigners supported shares, but 
selling by institutional inves- 
tors pushed down the index In 
the afternoon. 

The Topix index of all first 
section stocks rose 2154 to 
1.631.71, while the Nikkei 300 
put on 4.16 at 30253. Rises out- 
numbered declines by 810 to 
244. with 129 issues unchanged. 
Volume amounted to 430m 
shares, against 447m. In Lon- 
don the ISE/Nikkei 50 index 
was 3.74 firmer at 1,363.01. 

The yen's appreciation 
against the dollar prompted 
most investors to remain on 
the sidelines. The Japanese 
currency closed Y0.65 up at 
Y 104 .30. the first rise to the 
YUM level since February 18. 
Some currency traders, who 
had hoped that a solution for 
the yen's recent singe would 
be discussed at the finance 
ministerial meeting of the 
Group of Seven leading indus- 
trial countries over the week- 
end, bought the yen. 

Electronic stocks and large- 
capital steels were sought by 
foreign investors. Hitachi, the 
day's most active issue, rose 
Y13 to Y950 and Toshiba Y17 to 
Y773. Nippon Steel gained Y3 
at Y352 and Mitsubishi Heavy 
Industrial Y7 at Y707. 

Multimedia related stocks 
continued to gain ground. Nip- 
pon Telegraph and Telephone 
climbed Y 24 .000 to Y97S.000 
and NEC YlO to Yl.060. 

Arbitrage buying supported 
bank shares. Industrial Bank 
or Japan moved up Y50 to 
Y 3.320 and Sakura Bank Y40 to 
YI.510. Brokers were also 
strong, with Nomura Securities 
adding Y60 at Y2.330 and 
Nikko Securities Y70 at Yl.300. 


Trading of shares in Daiei 
Finance, a consumer credit 
company belonging to the 
Daiei consumer group, was 
suspended in the afternoon fol- 
lowing reports of a merger. 
The company said it will be 
merging with Riccar and Asahi 
Agency Travel, two other com- 
panies in the Daiei group. 

P rofi t-taking depressed some 
electrical machinery shares. 
Casio Computer fell Y40 to 
Yl.300 and Akai Electric 
slipped YlO to Y440. 

In Osaka, the OSE average 
moved forward 194.00 to 
22,138.88 in volume of 80.4m 
shares. 

Aoyama Trading, the men's 
suit retailer, dropped Y190 to 
Y5.940 following weekend 
reports that it was under inves- 
tigation by the Fair Trade 
Commission on alleged false 
advertising of its suits. 

Roundup 

The region's markets had 
mixed performances yesterday. 

HONG KONG finished 
sharply higher on a technical 
rebound From last week’s 
heavy losses and on fresh 
demand ahead of results of 
HSBC Holdings which were 
due out later yesterday. 

The Hang Seng Index jumped 
309.98, or 3.07 per cent, to 
10,41023, off the day's high of 
10.462.63. Turnover totalled 
HK$45bn, down from last Fri- 
day's HK$7.2bn- 

Brokers said a technical 
rebound was expected after the 
market’s plunge of 725.63 last 
week. After the market closed, 
HSBC said 1993 pre-tax profits 
were £2.58bn, up from £I.71bn 
in 1992. 

HSBC shares rose HKS3 to 
HK$114 and led the actives list. 
Its Hang Seng Bonk unit 
gained HK$2 at HKS69.50. 

Tuesday's government land 
auction of three residential 
sites is expected to attract 
strong interest, said brokers. 
The property sector sub-index 
surged 659, or 3.6 per cent, to 
19,012.83. 

MANILA declined steeply fol- 
lowing the weak performance 
last week of Philippine Long 
Distance Telephone. Brokers 


said the market was also 
weighed down by government 
plans to double the stock trans- 
action tax to 0.5 per cent 

The composite index ended 
88.52 down at 2,861.61. Turn- 
over came to 86L6m pesos. 

PLDT fell by some & on Wall 
Street last Thursday, and the 
market discounted its slight 
recovery on Friday. The local 
price for PLDT dropped 55 
pesos to 2,035 pesos. 

TAIWAN shed 3.1 per cent to 
end at its lowest level this year 
in very bearish trade. Margin 
loan calls produced persist e n t 
s elling pressure and the prices 
of major banks collapsed. 

The weighted index lost 
175.63 at 5.414.64 in turnover of 
T$52J3bn. The financial sector 
plunged 5.3 per cent, with the 
Big Three banks closing at or 
near the day’s limi t down. 

BANGKOK tumbled 03 per 
cent to close the day at 
1,372.93, down 46.61, on ner- 
vousness ahead of local elec- 
tions this weekend. 

BOMBAY closed slightly 
higher ahead of the budget 
announcement, which came 
after the close of business yes- 
terday. However, the market 
moved further ahead in a 90- 
minute post-budget session, 
the BSE Sdshare index fi rming 
5L02 to 4^87 J8. 

AUSTRALIA bounced back 
after successive falls to dose 
higher, boosted by steadier 
overseas markets and a jump 
in the futures sector. The All 
Ordinaries index rose 313 to 
2,180.1. Turnover amounted to 
A$367.fim. 

News Corp led the way, gain- 
ing 31 cents at A$i0.06 with 
2.4m shares traded. 

NEW ZEALAND rose 
strongly, retracing some of last 
week's losses. The NZSE-40 
capital index added 28.07 at 
2.24435 in volume of NZ$4tto. 

SOUTH AFRICA 

Non-industrial shares were 
marked higher as the market 
was buoyed by a firmer gold 
bullion price and a shortage of 
scrip. The overall index added 
48 at 4.846, industrials lost 22 
at 5,609 and the gold shares 
Index advanced 89 to 1,995. 


The major markets began the 
week generally stronger, writes 

Our Markets Steffi 

ZURICH was the exception, 
marked lower as the banking 
sector, which had held np bet- 
ter than the broad market 
early on during the recent 
market correction, succ umbed 
to further domestic and foreign 
selling. The SMI index shed 
13.4 to 2,9153, under pressure 
from derivatives trading and 
with a stronger bond market 
unable to offer much assis- 
tance. 

Bearer shares in UBS, which 
reported a 69 per cent rise in 
1993 group net profit cm Friday, 
siwd another SFr57 or 4 per 
cent to 8FTL3S6 as Credit Sui- 
sse reduced its recommenda- 
tion Grom a buy to a hold. 
Credit Suisse said that UBS 
shares were fully valued and it 
suggested a short term switch 
into SBC. 

At the same time, Goldman 
Sachs was reported to have 

echoed the recommended 
switch to SBC. Merrill Lynch 
cut its rating on UBS from a 
hold to a sell in the immediate 
aftermath of the results. 

Credit Suisse bearers fin- 
ished SFr36. or 5.3 per cent 


Feb 28 THE EUROPEAN SEMES 

nmy cfaaow Opao man tuo lzno liar urn ma daw 

FT-SEBmtacklOO 14841 MSSJ3 145&6I 145538 1 <53.90 1 45X24 145436 1458.43 

FT-SEBntrackSOO 15032 151466 1511.78 1B11JO 151 M2 1S14M 1512S3 1512.74 


FT-Se Bi utmfc 100 144X01 14B0J4 1408.10 147*28 14B33I 

FT-SE BfUtt* 200 1 40035 1S0X51 1537.85 1030.12 1539.13 

fee mm 1060 psrwHfc wMto: too - 7<sa« an . ihm un» too - waaio ao - is nun. 


lower, at SFr638 after some lata 
US selling added to earlier 
pressure from London inves- 
tors. SBC lost SFrl5 at SFr450. 

In the opposite direction, 
Alusuisse added 21 at SFT644 in 
continued response to its posi- 
tive earnings forecast last 
week and amid Indications 
that investors were beginning 
to switch from interest rate 
sensiti ve stock s into cyclicals. 

FRANKFURT was lifted by 
renewed strength in the bond 
and futures market , although 
activity was fairly muted 
throughout the There 

was also a signal from the 
Bundesbank, which said it 
would supply funds to the 
money market at variable 
rates, that it would make a far- 
ther cut in interest rates later 
in the week. The market win 


be awaiting with interest the 
release of January M3 data, 
also due during the week. 

The Dax index rose 1666 to 
2JXR.57, recovering all of the 
losses on Friday and the Dax 
March futures contract 
advanced 19.00 to 2,099.00. 

Daimler-Benz, which had 
fallen in post-bourse trading on 
Friday, pulled itself forward 
DM460 to DM812.00 in spite of 
news that the chairman, Mr 
Edzaxd Reuter, was likely to 
move to Airbus Industrie, 
which in turn would spark a 
major reshuffle of senior posts 
at the Industrial group. 

The banking sector went 
against the rising trend, 
affected by the prospect of 
lower interest rates: Commerz- 
bank slipped DM3.50 to 
DM34L50 and Dresdner Bank 


Bond sell-off provides cue 


By Michael Morgan 

T he sell-off in bond mar- 
kets by panicking hedge 
funds last week deter- 
mined the performance of 
global equity markets. 

Most European centres fin- 
ished the week lower, with the 
sharpest falls seen in Italy, 
Ireland, Germany and the 
Netherlands. Hong Kong also 
continued its bumpy ride, 
although a strong performance 
by the heavily weighted Japa- 
nese market left the FT-Actu- 
aries World index little 
chang ed on the week. 

The consensus among most 
economists yesterday, even 
before the Bundesbank offered 
variable rate repos, which hold 
out the prospect of lower 
money market rates, was that 
the shake-out in bond mar kets 
was likely to prove temporary 
and that European Interest 
rates would resume their 
downward momentum In the 
not too distant future. 

Mr Marcus Grubb at Salo- 
mon Brothers is among those 

r emaining op timistic about the 
outlook for European shares. 
But he notes that the latest 
change of mood is likely to 
continue until the downtrend 
in the US bond market stabi- 
lises or European bond and 
stock markets decouple from 
the trend in US markets. 

“Further substantial dwiinw 
in European short-term inter- 
est rates, led by the Bundes- 
bank, will push stock markets 
higher later this year," he says. 
“Steepening yield curves will 
also boost inflows of cash into i 
mutual tends. If US liquidity Is 
repatriated as a result of the 
rising trend in Fed funds. I 
domestic liquidity in Europe is 
likely to replace it" 

Hoare Govett sees no reason 
why bond yields in the US 
should dictate the trend in 
Europe, where economic cir- 
cumstances are entirely differ- 
ent The broker notes that the 
European economic cycle is 
some 18 months to two years 
behind that in the US; in 
Europe output has barely sta- 
bilised after its earlier sharp 
falls, while the US economy 
has been growing strongly for 
around two years. 

“In Europe inflationary pres- 
sures are still abating, while in 
the US the first hint of an 
upturn in inflation is begin- 
ning to emerge. More- 
over . . . European monetary 
and fiscal policy settings are 


^S^^X^T^WOBL^INDICES 


enmpdod by The RrcncJd Times Ltd. Gofckran. Sacha & Co. and NafWest Secuttns Ltd. in conjunction with trw Institute of Actuaries anti the Faculty of Actuaries 
NATIONAL AND 

REGIONAL MARKETS FRIDAY FEBRUARY 25 1flB« THURSDAY FEBRUARY 24 1994 DOLLAR WDEX - 


REGIONAL MARKETS FRIDAY FEBRUARY 25 1004 

Fifjuin m furonttwsoa US Day's Pound Local Coca 

show number at fanes Dobr Chans* Slerifcg Yen DM Currency * ch 

c index % InJm Index Index Index on dr 

Aus--raUa (CP) 1 74.52 -3.1 173.61 11S.S3 154.7S 161.09 -2 

ijsinaim 188.70 1.2 187 71 124.91 167.31 167.41 -a 

Belgium 142) ....16664 1.6 165.77 110J1 14776 144.33 0. 

CcnodopOO .. . „ — „..13394 0.6 >33X4 8&68 11X76 130.88 1. 

Oonmarii (32) .266 91 1 I 267.51 1 TSOI 23043 244.47 -0. 

Frwjndffa 146 90 0.9 148.14 9725 13025 17061 -X 

France (99t . 176.33 0 9 175.41 IIB-TO 156.36 160.54 -O. 

Germany ©9) ....... 131.75 0.7 131.08 87.22 11602 11682 -O. 

Mo**] Kong (561 40605 12 403 93 26880 36Q.04 403.13 -3. 

mNjndtlJ) 189 63 04 186.66 12653 16X14 18690 -6 

nay <1*1 74 J5 1.1 73.87 49.15 6564 93.09 6 

Japan <46Si ... .. .... 1S423 08 153.43 102.10 138.76 102.10 Q 

KbayVj ,631 533.07 -1 3 S3X30 3S389 472.67 559.75 -1. 

Mexico |i» 2303.60 1.6 2291.58 1524.33 204X52 007222 O 

NtihcrijntJ (261 108.99 0 9 197.95 131.73 176.44 17*01 -0. 

New Zealand 0+1 .69.94 -2.8 8957 4X30 6X01 6455 S. 

Noumea —70424 1 6 203.18 13S.2D 181.09 205-25 0 

Sowoporo [451 348 01 -I.S 346.20 230.38 30657 253.79 -1. 

Scum A.'rtca (PO) -297.27 1.0 23603 15707 21038 244-28 0 

Spam ,421 146.4? 0.6 14566 9633 129.83 154.40 -O 

SwCctoiO® _ 210 86 -04 21672 14S56 1B4.9S 280.09 -O 

5«t=wu*«t (49) 0.8 165.42 11008 147.44 147.11 -0. 

Unite hinjermp 151 _ .2M.M II 199.45 102.72 177.78 189.45 0. 

USA 15181 — 19968 &3 168.69 125.56 186.18 18X68 O 

EUROPE ,7461 -183.51 0.9 16883 11221 15030 16X22 -0. 

Noriact113» -.212.73 0.3 211.01 14082 186.01 21691 -O 

Pacific Bonn (72?} -...104.30 0.2 183.45 10a77 14X09 113.29 -0. 

Euro-Pnoflc (1467) 106.32 05 185.46 11010 147.47 132.44 -0. 

North America (025) 108.22 03 18525 12X27 185.11 185.83 0. 

Eu«T* Ex. UK 1530) .. 149.48 08 148.70 9696 13X54 14014 -0. 

PaoKc E*. Japan C53) -26214 -2.7 26078 17X53 232.44 239.90 -2. 

Weld Ex. ITS (16521 . 167.52 0.5 108.65 11090 14654 135.55 -0. 

World Ex. UK (19551 171-31 0.4 170.42 11X40 151,89 14785 0, 

IVorUExSo M. Pilot .173.53 OS 172.63 114.87 15X66 151.73 O 

WoriOEiL Japaiproi) 16X0 03 105.26 123-28 165,12 18X03 0. 

The World Htkw Cl 70) 173.87 05 17X97 11510 1S4.17 152.46 Q. 

Cww Ora Fc u um Trim* Ifawwl OoUnwv Sacfa and Co. wnJ MTMI Sacwmsa LMM 19S7 
Late-4 pnu* inaHk Itar ma edticn 


Local Local Gross US Pound 


174.52 

— 188.70 
....166 64 
-..>33 94 

. si 
. .14690 
.... 17633 
-..131.75 
...,40605 
. .189 63 
. — 74J5 

1S423 

....533.07 

.230X00 

-...100.99 

.....69.94 

20424 

348 01 

..297.27 

...146.42 
. 210 86 

18829 

. . -200 40 
10968 


0.9 

197.95 

131.73 

176.44 

-2.8 

6957 

4030 

62.01 

1.6 

20X18 

135.20 

>01.09 

-1.5 

346 JO 

23038 

30857 

10 

236.03 

15707 

21038 

0.6 

145.66 

9083 

129.83 

-4L4 

21672 

14055 

T34.9S 

0.0 

165.45 

110.08 

147.44 

1 1 

199.45 

132.72 

177.78 

0.3 

168.69 

>25.50 

186.18 

0.9 

16662 

11X21 

15030 

0.3 

311.01 

14X82 

186.61 

0^ 

163.45 

10077 

145.69 

OS 

185.46 

11010 

147.47 

03 

185X5 

12X27 

16&11 

OS 

148.70 

98.96 

13X54 

-2.7 

26078 

17X53 

332.44 

0.5 

168.65 

110.90 

14X54 

0.4 

170.42 

11X40 

151S9 

as 

172.63 

114^7 

15356 

OJ 

105.26 

12328 

165.12 

05 

172^7 

11510 

154.17 


FEBRUARY 24 I960 

DOLLAR NJGX 



Local 



Year 

Ywi 

DM Oxraney 199^94 

1933794 

ago 

Inde* 

hda* 

index 

High 

Low ( 


11X81 

182.00 

164J3 

169.15 

130.19 

13049 

124.15 

167.72 

13757 

195.41 

13X63 

14X90 

10029 

147^4 

144.16 

16X06 

140JW 

141.82 

88.68 

11X81 

12X74 

145.31 

11X10 

11X92 

177.11 

2392S 

244.01 

275.79 

19X86 

202£2 

96-92 

13X94 

170.64 

15X72 

70.02 

7X67 

118.42 

15720 

16142 

18SJJ7 

14X60 

15534 

87.11 

117.68 

117.68 

1*ZJ» 

107.59 

111J51 

27033 

377.38 

41X38 

506,56 

23X84 

250.45 

'25.60 

16927 

187JB 

20X33 

134.07 

134 J97 

4092 

8X10 

92.70 

7X93 

5X21 

6X04 

10184 

137.73 

10144 

165.91 

10737 

109.11 

35079 

48X10 

56X21 

821.03 

274.40 

275.05 

151CL23 

204X36 

604X16 

2647.08 

141020 

1424.49 

13136 

177.47 

17449 

207.43 

15X03 

159X3 

47.B3 

64.75 

65.S8 

77.® 

44.74 

44.74 

13X92 

18033 

204.48 

204.44 

13X83 

139.63 

233.28 

317.65 

25X23 

378.82 

21X57 

224£6 

15X49 

21142 

24240 

29X26 

160.75 

1673* 

9883 

13X95 

154.72 

155.79 

11X33 

12234 

147.04 

19X65 

261.97 

230.02 

154.79 

15X17 

10X88 

146.46 

14X12 

17X56 

10X14 

109.14 

13X02 

12&89 

17X37 

17X08 

13X85 

16844 

214.96 

19X04 

16X23 

17X01 

18X83 

160.64 

111.85 

151.11 

162,40 

17X50 

13X36 

13X35 

141^9 

19X89 

21960 

22X60 

14X95 

14X47 

109.19 

147.53 

11X60 

168J0 

11X95 

114^6 

11X20 

14X88 

132.70 

17X70 

12X36 

12036 

12356 

16X96 

184.98 

102.73 

17X70 

17X69 

96.78 

13X43 

140.7* 

155.73 

11921 

11931 

179J5 

24X31 

24X03 

29X21 

164J4 

167.84 

11X97 

14922 

135.75 

17251 

124.42 

124.49 

11X54 

15X63 

147^7 

17X58 

140.47 

140.47 

115JV4 

12X60 

15642 

16X98 

151.70 

182.08 

17X56 

19X20 

142,40 

161.44 

142-40 

161.44 

11X26 

15X71 

152.44 

17X97 

14X47 

14X47 


extremely restrictive for the 
c urre nt stage of the economic 
cycle, while US monetary pol- 
icy is lax. Ibis leads us to sup- 
pose the trough Of the rnflaHrin 
cycle wifi be much lower in 
Europe than it was in the US.” 

Merrill Lynch notes that 
signs of a res u rg e nce of infla- 
tion are noticeable by their 
absence in Europe, and its 
economists believe that bond 
yields in Europe can continue 
to fall even if yields rise fur- 
ther in the US. It adds that 
valuations suggest that equity 
markets can wvnHnua to rise 
even if bond yields do go tip. 

“Brad yields are not the only 
determinant of equity prices; 
dividend growth also matters. 
To the extent that higher bond 
yields reflect faster economic 
g ro wt h , they are likely to be 
accompanied by strong profits 
and dividend growth." 

Merrill Lynch mminpnfs that 
the impact an equities is the 
result of a trade-off between 
these two factors. “We use the 


framework of the yield ratio to 
PTawine this tradeoff. We con- 
clude that if the global eco- 
nomic recovery is as strong as 
we expect, then we could expe- 
rience rapid dividend growth, 
rising brad yields and rising 
equity markets in Europe over 
the next three years.” 

NatWest Markets agrees that 
the bull market, particularly 
far equities, is not yet over. 
“Admittedly, the risks have 
increased, especially if the US 
long bond pushed decisively 
above 7 per cent But in our 
view, the US bond market fears 
are overdone." It says history 
demonstrates that after long 
periods of falling rates the first 
rise in the Fed Funds rate does 
not precipitate a bear b ubIbbL 
The key issue for equities and 
bonds Is the schedule for far- 
ther interest rate increases. 
“We expect global stock and 
bond markets to move higher 
in the months ahead and pro- 
vide us with a better opportu- 
nity to raise cash.” 


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weakened DM350 to DM40650. 

AMSTERDAM regained the 
Upward course helped by an 
improvement in a number of 
the hi ghl y capitalised issues- 
Both Royal Dutch and Uni- 
lever, which had suffered last 

week, found support, with 
respective rises of FIS. 00 and 
FI 2.20 to FI 204.70 and 
F1ZL5.90. 

The AEX index closed np 
5.11 or 12 per cent at 420.75. 

The day's story was Poly- 
gram, up FI 430 or nearly 6 per 
cent at FI 7750, which saw a 
strong rise in 1998 profits, and 
gave an upbeat forecast for the 
year ahead. Philips, the parent 
group, added FI 150 to FI 4750. 

Another food group to bene- 
fit from the upturn in Unilever 
was BolsWessanen, rising 
F12J.0 or 5 per cent to FI 44-10- 

PABIS recovered the 2,200 
level as some support for the 
market returned after last 
week's declines. The CAC-40 
rose 39.14 or L8 per cent to 
2,238.06. 

Turnover was FFr3.7bn. 

Euro Disney returned to the 
news, and the shares advanced 
FFrl.60 or 5 per cent to 
FFr3450, following news that 
creditor hanks had outlined an 


MARKETS IN PERSPECTIVE 



% «rtnga 1* Urt anaatar t 



klUBSt 


1 1M 

4 — 

1 Yaar 

Start at 

m 

awtsJ 

was 

■tart m 

tan 

Austria 

->054 

-221 

+36.13 

+42.61 

+36.77 

+34.63 

Belgium 

-2.07 

-229 

422J4 

+32.12 

+27.07 

+2008 

Denmark ...» 

-1.95 

-082 

+4128 

+53.81 

+48.77 

+44.48 

Finland 

-ZJBB 

-122 

+94,03 

+123.15 

+114.38 

+111.03 

Franca - — 

-1-94 

-4jB7 

+1856 

+25.88 

+21.71 

+1901 

Germany 

-3.13 

-2-80 

+2329 

+33.36 

+28.64 

+2063 

Ireland _ 

-3.48 

-5.87 

+45.80 

+58^5 

+41.88 

+38.68 

Italy 

-4.68 

+1.02 

431.65 

+54.17 

+37.48 

+35.32 

Nqthertanda 

-3.06 

-3.98 

+2X78 

+3044 

+33^2 

+31.43 

Norway .. _ 

+120 

+025 

+55.39 

+5074 

+50.67 

+4031 

Spain 

-2.98 

-5.33 

+4127 

+52.63 

+27.56 

+25£6 

Sweden. „ 

-2.06 

-126 

+43.35 

+50.05 

+34.91 

+32.80 

Switzerland 

-2.B7 

■030 

+4327 

+4328 

+49.48 

+47.15 

UK 

-2.83 

-L54 

+1726 

+1017 

+1017 

+1032 

EUROPE 

-2.79 

■097 

+2427 

+2089 

+2X80 

+2X83 

Austrafia 

-328 

-420 

+28.77 

+33.13 

+41.70 

+38.48 

Hong Kong 

-7.16 

-1224 

+62.12 

+83.07 

+86.18 

+3327 

japan — 

+324 

4520 

42529 

+23.18 

+49.18 

+4084 

Malaysia 

+522 

+7.40 

+10085 

+112^3 

+107.12 

+10X88 

New Zealand 

-2-83 

-007 

+41.77 

+4523 

+65.64 

+6X07 

Singapore — 

4011 

-0.03 

4035 

-2.78 

+49.40 

+20-37 

+57.34 

+23.02 

+65.69 

+1766 

+^,11 

+1082 


USA 

Modco — ■ 

South Africa . — 

WORLD INDEX 

t Baaad an ftotaoay : 


+1.81 +47.36 +55.43 *82.78 48021 


-0.16 -IjOI +18.13 
IWt cawrt» H» WmilMT 


+10671 +2852 1 +2468 


primarily in the rapidly growing 
derivatives field and has launched 
more than 50 tends with US$ 1J2 
billion under advice. Sf 

* Security oTReturnoT Capita] SJ 
The Chase Manhattan Jjgfj 

Bank, N -A, has by way of a gjff 
Stand-by Letter of Credit** jSf 
provided holders of Mff 
Units at the Maturity Date in 

May 2003 with an 
jflKr irrevocable undertaking to 
an amount which ensures 
1 1 the return to investors of their 

initial subscribed capital in respect 
-^of Loan Notes held at the Maturity Date. 

is this enough? 

Units are US$ denominated, have no sales 
charge, and may be liquidated monthly.*** 

For more information, please contact; 

London: John Townsend or Brian Fudge 
Fax.- 4-44 71 828 6458, Tel: +44 71 285 3200 
Bahrain : . Arthur Bradfy or Antoine Mas sad 
Fa xi +973 533 078. Tel: +973 533 288 
Miami: Steve F. Phillips or Simon E. Amich 
Fax: +1 305 530 9621, Teh +1 505 539 9700 

Hong Kong: Anthony Nall or Margaret Yao 
Fax: +852 557 1205, Tel: +852 521 2933 

Tokyo: Matthew Dillon 

Fax: +81 3 3838 6527, Tel: +81 3 3238 6321 


THIS FUND IS ONLY ON OFFER UNTIL 22 APRIL 1S&4 SO ACT NOW1 
TO RECEIVE INFORMATION FAX THIS COUPON TO ■ » i U 71 626 6458 


May 1932 
I 


Nov 1838 May 1983 nm,I 

I I I 

mwilWlDannR 'Ousts MUTMarlGS MWMnNbr f«> -Mw wamMNT 


MINT 

Please send me more Information on Mint Plus Guaranteed 2003 Limited. 


Work Phone No., 


F.T. W/C2Sf2 ^ 



agreement to provide a rescue 
package to the theme park 

operator. _ 

Moulinex gained FFr9.60 or 
7.4 per cent to FFrl3S.60 on a 
broker’s upgrade, while Assur- 
ances Gdnfirales de France 
dipped FFr17 to FFrf28 after 
the insurance group said that 
1933 profits would be below 
those of the year before. 

SOLAN edged forward, the 
Comit index adding 3.10 to 
658^0 in thin trading. 

BCI was an exception, 
adding L131 or 22 per cent to 
L6.060 as the public offer for 
the shares was launched yes- 
terday. The buying was attri- 
buted to investors who fear 
that heavy demand for the pri- 
vatisation shares, priced at 
L5.400, irywns that allocations 
will be cut 

ISTANBUL lost 7.4 per cent 
as the Turkish lira lost more 
than 5 per cent against the dol- 
lar tn spite of higher central 
bank interest rates. 

The composite index was 
down 1,195.92 at 15,003.58, 
although after a day’s low of 
14J380.4. 

Written and edtod by John Pitt 
and Mfc ha Bl Morgan 


i * * 


* 




Home Fbcar No 


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lanatBcnl na Omu ci op Bofl aananenu la (idav nut Imxmm oumnotaa njaSea the w InnMacnt, Tb mTi. 

made ihe waft art 1» art .wBiNe io naafcnu ofBie UI. and dn» or mMeou rfifce tat k d 

lr 11 k UK (Ac ScCnrtOco mJ IrrxHZMUt BouxL >™rm«uon«i i*l U regolttod 


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