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AT&T forms $ 1 bn 
Mexican telecoms 
joint venture 

AT&T, the US telecommuoicatioos group, is to form 
a $1 bn joint venture with Grupo Alfa, a large Mexi- 
can industrial conglomerate, to provide telecommu- 
nications services in Mexico. Alfa will hold 51 per 
cent of the venture and AT&T 49 per cent. The 
jointly-owned company is expected to apply for a 
licence to offer long-distance telephone services in 
Mexico, a market which will be opened up to com- 
petition from January 1997. Page 20 

US operations lift News Corps News 
Corporation. Rupert Murdoch's international media 
group, reported a 15 per cent rise in first-quarter 
net profits to A$3Qim fUS$232m) following strong 
results from the company's US film and television 
operations. Page 23 

Sutherland may take caretaker trade role 

With the contest for the 
top job at the future 
World Trade Organisa- 
tion deadlocked. Peter 
Sutherland (left), direc- 
tor-general of the Gen- 
eral Agreement on Tar- 
iffs and Trade, is 
believed to be ready to 
stay on in a caretaker 
role. Mr Sutherland said 
last April he would not 
be a candidate for direc- 
tor-general of the WTO. which is due to begin work 
on January L Page 18 

Hanoi expects $2bn In foreign add: Vietnam 
is likely to receive pledges of some J2bn <£i .2bn) in 
foreign aid at a donors' meeting in Paris next week 
and wants about SlOfrp byjhe end of the decade to 
fund its economic reform programme. Page 7 

Toyota plans second Canadian plain 

Japanese carmaker Toyota is to build a second 
ossembly.pdant in Canada to double production 
capacity ItFfbe country to 205X00 cars a year by the 
late 1990s/Page 8 

Jakarta plans privatisation drive: Indonesia 
plans a privatisation drive as part of its 1995-96 bud- 
get wtth injgrpaticiwl equity offerings and flota- 
tions oh Jakarta stock exchange. Page 7 

SA Breweries 21% ahead: Sooth African 
Breweries, the country's largest industrial com- 
pany, recorded a 21 per cent rise in attributable 
profit to R342m (897_&n) for the six months to Sep- 
tember. helped by an improvement in South Afri- 
can consumer confidence. Page 23 

EU signs $124m Palestinian aid deal: The 

European Union signed an agreement with Yassir 
Arafat, chairman of the Palestinian self-rule author- 
ity. for aid worth up to $124m next year. Page 6 

Union Pacific fries new tactics The battle for 
Santa Fe Pacific, one of the biggest US railway com- 
panies. intensified as Union Pacific, the hostile bid- 
der. produced a new offer designed to outman- 
oeuvre Burlington Northern, the friendly suitor. 

Page 22 

Siemens down 17%: German electronics group 
Siemens is to pay an unchanged dividend despite a 
17 per cent drop in annual net earnings to 
DMl.65bn (SLlbn). Page 19; Lex, Page 18 

Co-op Bank may be sokh The sale of part or 
all of the UK-based Co-operative Bank is being con- 
sidered by its owner, the Cooperative Wholesale 
Society. Page 20 

C&W plans cuts at Mercury: UK 

telecommunications group Cable & Wireless 
announced staff and cost cuts at its UK-based Mer- 
cury Communications subsidiary while reporting 
an 11 per cent increase in interim pre-tax profits. 

Page 19; Lex, Page 18 

Swedish PNTs pledge if voters back EU: 

Swedish prime minister Ingvar Cartsson promised 
an urgent government programme to increase 
employment if there was a Yes vote in Sunday's ref- 
erendum on membership of the European Union. 

Page 18 

New priv a te hospital in receiv e rship: Health 
Care International, the Scottish private hospital 
opened four months ago to cater for overseas 
patients, went into receivership when its bankers 
were unable to agree a rescue package. Page 9 

UK students protest at funding cuts: Up to 

20,000 students marched through. London protesting 
about grant cuts which they say make it impossible 
to survive without incurring big debts. Page 9 

Protest at livestock shipment: Animal 
welfare groups protested at Sheerness in Kent at 
the launch of a UK ferry service carrying live ani- 
mals to mainland Europe. Page 9 


■ STOCK MARKET INDICES 


FT-SE 100: .. . . 


(♦35.8) 

New Y«k PundtUme. 

Yield 

All 


S 

1807 


FT-SE EurotecK in 

—1,345.14 

(♦20.35) 

London: 



FT-SE -A ftR-Shara 1£&83 

warn, 

S 

1.8838 

(1.6184) 

NBAel _ 

.19^42188 

MM, 

DM 

24534 

124432) 

New York hnetthne 


FFr 

8.4335 

(6393) 

Dow Jones Ind Aw _ 

„4824J1 

(-6.73)1 

SFr 

20542 

(20407) 

S&P Composite 

48424 

1-0.81) 

Y 

156311 

(156.993) 

■ US LUNCHTIME RATES 

Etatti 

888 

(80.5) 


Federal Funds: 4JJ% 

3-mo Trees Bffls - YM - 5332% 

Long Band S3A 

Yield - 

■ LONDON MOiaV 


3-mohteta* 


-6*8% 


(6A%) 

bile big gH hare: — DeclOli! (DeciOfi 

■ NORTH SEA OIL (Argttt) 


Brent 15-day (Dec) — 31734 

■ COLO 


117241 


New York Coma (Dec) —33843 
London ——-3384,4 


<385.11 


■ STERUfQ 


M DOLLAR 


Hew York kreftttme: 

DM 132625 

FFr 52430 

SFr 1377 

Y 9735 
London: 

DM 133 (1.5097) 

FFr 52593 (5.186) 

SFr 1281 (126G9) 

Y 97.79 (97305) 

S Index 81 J (812) 

Tokyo dose Y 9724 


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Sweden SKM6 
Swite SM30 
Sjirta SE50L0Q 
Tuntsfa ftni 500 
Tl*V*y 130030 
UAE Cr.12.00 


Doubts, oyer trade and foreign policies B Investors expect pro-business Congress 



gridlock as 
Republicans sweep to victory 


By Jurok Martin and George 
Graham In Washington 

The most sweeping Republican 
triumph in congressional and 
state governor mid-term elections 
in nearly 50 years left the US 
yesterday with the prospect of 
confrontation and protracted 
political gridlock. 

Magnanimity from the victors 
and pledges of cooperation from 
the vanquished were the prevail- 
ing sentiments yesterday, but 
there were doubts about the fate 
of foreign and trade policies, as 
well as the purely domestic, over 
the next two years. 

Congressman Newt Gingrich, 
almost certain to be the next 
Speaker of the House of Repre- 
sentatives, said he would seek to- 
find areas of accommodation 
with the Democratic administra- 
tion - on greater budgetary con- 
trol, tax credits for middle-in- 
come families and welfare reform 
- before pressing ahead with the 
more ideological elements in the 
Republican manifesto most obvi- 
ously unpalatable to President 
Bill Clinton. 

Mr Clinton, on the receiving 
end of a drubbing, was due to 
offer his own postmortem at a 
press conference. But he called 
Mr Gingrich yesterday and. 
according to reports from both 
sides, offered, and received, 
pledges not to allow the nation's 
government to sink into gridlock. 

The 52-48 majority in the Sen- 
ate won by Republicans at the 
polls even grew by one when Sen- 
ator Richard Shelby, the conser- 
vative Democrat from Alabama; 
announced be was crossing the 
political aisle. Flanked by the 
Republican hierarchy, senators 



* IIS imd-term 
election 
results 

NEW OU7 


House 

Democrat 

Ftepubiican 

204 

230 

256 

178 

SENATE 

Democrat 

47 

56 

Republican 

53 

44 

GOVERNORS 

Democrat 

18 

29 

Republican 

31 

20 

Independent 

1 

1 

PiovtacnaT fofBC33ts based on AP resUis 


Bob Dole and Phil Gramm, he 
said he was joining "a party of 
hope for America" and leaving "a 
party of dependency”. 

But Mr Dole and Mr Gingrich 
were generally less inclined to 
crow even after the results, in 
which no Republican incumbent 
was defeated, far exceeded then- 
wildest dreams. It was an elec- 
tion in which public discontent 
with government in most of its 
works was manifest. 

Mr Leon Panetta, White House 
chief of staff, said he had spoken 
to Mr Gingrich on Tuesday right 
and, trying to hold the Republi- 
can's feet to the fire, "hep!: ired 
to work with us to try »r..i jet 
the Gatt treaty passed”. ' 

The Gatt vote is due later this 
month by both Houses in a spe- 
cial session of the old Congress. 


Mr Panetta conceded "clear dis- 
appointment”, but denied the 
results were a vote of noconfi- 
dence in the president or his eco- 
nomic policies that had produced 
so many new jobs. "It's really a 
vote that places on the Republi- 
cans the responsibility to help 
govern this country with the 
president.” he said. 

But the Senate will have to get 
along without a Republican can- 
didate who would have been diffi- 
cult to imbue with any spirit of 
co-operation. Mr Oliver North 
lost in Virginia to Senator 
Charles Robb. 

In California, Mr Michael Huf- 
fington. who spent $25m on his 
campaign, bad still not publicly 
accepted his two-point defeat by 
Senator Dianne Feinstetn at noon 
when almost all the votes were 
counted. 

The Republican losses were 
more than offset by the coll of 
dozens of Democratic luminaries, 
from Congressman Dan Rosten- 
kowski in Illinois through to 
Governor Mario Cuomo in New 
York to Senator Jim Sasser in 
Tennessee, all victims of voter 
resentment and unknown Repub- 
licans. The victories of two sena- 
tors, Edward Kennedy in Massa- 
chusetts and Daniel Patrick 
Moynihan in New York, were 
scant compensation. 

The result leaves the country 
with a new political face. In the 
House, with nine contests still 
undecided, the Republicans, with 
a provisional net gain of 49, 
already had acquired an edge of 
about 227-198. 

Election reports. Pages 4. 5; Des- 
perately seeking solace. Page 17; 
Editorial comment. Page 17. 



President Bill Clinton: offered, and received, pledges not to allow the 
nation’s government to sink back Into gridlock 


German multimedia deal blocked by EC 


By Emma Tucker to Brussels 
and Michael Ltodemarm to Bonn 

The European Commission 
yesterday blocked a multimedia 
deal among three of Germany’s 
most powerful companies after 
deciding it would prevent other 
competitors from entering the 
German market for pay televi- 
sion. 

Using for only the second time 
its powers to block joint ven- 
tures. the Commission competi- 
tion authorities argued that the 
deal was incompatible with the 
single market 

At stake was a proposed ven- 
ture between Bertelsmann, the 
world’s second largest media 
group; the Kirch group, one of 


Germany's biggest private televi- 
sion companies; and Deutsche 
Telekom. The companies 
intended to set up a company - 
MSG - to provide infrastructure, 
marketing and booking services 
Cor commercial pay-TV. 

Some sections of the multime- 
dia industry said the Commis- 
sion's decision would frustrate 
the development of multimedia 
services in Europe. 

“A practical entrepreneurial 
attempt to create a market of the 
future has been prevented," 
Kirch said. "The decision means 
that the creation of a digital com- 
munications infrastructure with 
the required management will 
not be possible." 

In July, the Commission 


launched an inves t igation, fear- 
ing the venture could create a 
dominant position in the German 
pay-TV market. 

"In principle a joint venture 
like MSG is desirable because It 
is able to implement new technol- 
ogies such as digital television,” 
said Mr Karel Van Mieit, com- 
missioner with special responsi- 
bility for competition policy. 
"But the structural features of 
MSG would lead to a protection 
of the market for services as well 
as for digital pay-TV." 

The market for pay-television 
programmes and services is 
expected to expand as digital tele- 
vision is introduced. The Com- 
mission said the prospects were 
particularly good in Germany 


because of the high number of 
households - 21 m - which 
already receive television by 
cable or satellite. 

Bertelsmann said yesterday the 
Commission's ruling had, in the 
short term, closed possibilities 
for many smaller programme pro- 
ducers to access future television 
technology. “At the moment the 


merger partners are the only peo- 
ple in Germany who have the 
technical and administrative 
capabilities to run such a busi- 
ness,” it said. 

Mr Van Miert denied the ruling 
represented a setback for 

Continued on Page 18 
Brussels closes gateway. Page 3 


Dollar 
rises hit 
stocks fall 
back after 
gains 7 

By Patrick Hanreraon 
in New York 

Republican success in Tuesday's 
elections sparked a strong rally 
tu the dolfor and US and Euro- 
pean financial markets yester- 
day, as investors anticipated that 
a more pro-business Congress 
would pursue .potideo. to aid 
growth t and ■ cot. ^government 
Spenda®Afc‘V V j'" ' 

However,*®- markets were 
unable to sustain their early 
pabis and Wall Street retreated 
amid' concerns that conflict 
between President Bill Clinton 
amd a Republican Congress could 
fimfontitnp investor confidence 
In the economy and the dol lar. 

The markets were also trou- 
bled by fears of rising US inter- 
est rates; most analysts expect 
the Federal Reserve to raise 
rates next week to slow 
economic growth and restrain 

inflation - 

Some analysts believe the poll 
results have import a nt implica- 
tions for monetary policy. Mr 
Richard Hoey, chief economist at 
the investment fond group Drey- 
fus, said: ?Ttae Fed will now be 
more free to tighten as test and 
as much as it wants, ft had been 
under pressure from Democrats 
in Congress.* 

The possibility that the Repub- 
lican success could lead Mr Alan 
Greenspan, the Fed chairman, to 
raise rates further and faster 
titan the markets had expected 
was b ehind some of the selling 
on US markets yesterday. 

By ipm the Dow Jones Indus- 
trial Average - which had 
jumped 38 points in the opening 
minutes - was down 11.44 at 
3,819.30. The dollar, however, 
remained higher, up almost 
2 pfennigs n gntmet the D-mark at 
DBLL525, and up half a yen at 
Y97.62. 

European stock markets 
greeted the Republican victories 
with impressive advances, but 
unlike Wall Street they kept 


Continued on Page 18 
World stocks, Page 38 
London market report. Page 31 
Currencies, Page 36 


Renault share sale likely to be 
oversubscribed, says minister 


By John Ridding and 
Andrew Jack to Paris 

The public offer for shares in 
Renault, which closes tonight, is 
likely to be oversubscribed. Mr 
Edmond Alphancfery, the French 
economy minister, said yester- 
day. 

Private investors are being 
allotted the majority of the 
shares on offer in the partial pri- 
vatisation of the motor group and 
first estimates of private demand 
bad been encouraging despite 
depressed stock market condi- 
tions, Mr AIpbandery said. 

However, the retention by the 
French government of just over 
50 per cent of Renault could also 
limit the number of private appli- 
cations, he added. 

“I am confident about the oper- 
ation,” he said, although he indi- 
cated that the level of subscrip- 
tions could be less than in 
previous privatisations. Final fig- 
ures on applications will be 
announced on Wednesday. 

Previous issues in the govern- 


ment's programme of privatising 
21 pubiicly-owned groups have 
attracted strong demand from 
private investors. Elf Aquitaine, 
the oQ group, drew 3m investors 
when it was privatised earlier 
this year, and Rhone Poulenc, the 
chemicals and pharmaceuticals 
company, drew i9m when it was 
sold at the end of 1993. 

Institutional investors have 
also shown strong demand for 
the privatisation issues. In the 
case of Renault, the shares allo- 
cated to institutions have been 
subscribed more than 15 times. 

Some bankers said that individ- 
ual demand for Renault shares 
was weaker than for previous pri- 
vatisation issues, but meet indus- 
try analysts believed the issue 
would be fully subscribed, partly 
because of its pricing. 

At FFr165 per share. Renault is 
valued at just under FFr40bn 
(ST^bn), Iowa- than the FFr45bn 
to FFrSObn valuations given by 
some motor industry analysts. 
The pricing gives Renault a rela- 
tively modest price.'eamings ratio 


of about nine times expected 1995 
earnings. 

Mr Alphanddry said he was 
confident the government’s pri- 
vatisation programme would 
maintain momentum. Including 
the receipts from Renault, the 
sale of public sector assets has 
already netted the government 
about FFrl03tm, be said. 

According to Mr Alphandery, 
Assurances Gene rales de France, 
the Insurance company, vriD be 
sold as soon as market conditions 
permit. The sale of the company 
has been delayed by the sharp 
fall in its share price, resulting 
from the impact of higher inter- 
est rates on its bond portfolio. Mr 
Alphandery has started the pro- 
cess of appointing adviser banks 
for Seita, the tobacco company, 
but no date for the sale has been 
set 

French privatisation has gone 
more smoothly than public sector 
asset sales in some other coun- 
tries. Mr Alphandery noted, but 
demand for some of the early 
issues bad been abnormal. 


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judging the financial markets, 
how's your form? 


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ANCIAI. TIMES THURSDAY NOVEMBER 10 I9M 


NEWS: EUROP 


Kinnock revs up in lay-by 


The European Union’s next transport commissioner is eager to get 
motoring, write David Gardner and Lionel Barber in Brussels 


\ * Jf Mr Neil 
Kinnock is 
straining at the 
bsasRhrsSssssil leash. Maybe it 
E UROP EAN is the prospect 
INTERVIEW 0 f leaving 

behind British politics for 
lusher European pastures, but 
this week the former leader of 
the UK Labour party was in 
ebullient mood as he spoke 
about hjs new job as EU ram- 
missioner for transport. 

Commissioner Kinnock, who 
starts work in January, likes 
the transport portfolio. After 
all, ordinary European citizens 
can relate mors readily to 
good, cheap, safe trans-frontier 
travel by air, road, rail or sea, 
than to the often opaque 
debate about the future of 


"Transport is something tan- 
gible," said Mr Kinnock in an 
interview, “it can have an 
application literally at street 
level" 

Over the nest five years, he 
believes "there is a real job for 
advocacy and advocates” of 
Europe. His warm, folksy man- 
ner will help make Europe 
more relevant; but ever con- 
scious of his reputation back 
home as the “Welsh windbag", 
he knows that “going for the 
flamboyant phrase" will not be 
enough to win credibility. 


“Before the headline term is 
used wb need a strategy for its 
delivery.’’ he says soberly. 
“Without that, this [Commis- 
sion] will always look like a 
well appointed rest home for 
bureaucrats.” 

It is too early to pin down 
the new commissioner on spe- 
cific policies. But he is clearly 
aware of the two toughest chal- 
lenges in his in-tray: develop- 
ment of the trans-European 
networks (TENS), the multi- 
hfiiinn Ecu road, rail and other 
transport projects designed to 
link Europe's single market; 
and state aid cases, particu- 
larly among some of Europe's 
cosseted airlines, which 
threaten to distort that market 

The TENS (like the Channel 
t unn el which he used to get to 
Brussels this week) are seen as 
job-creators In their own right, 
assuming up to Ecu400bn 
C£312bn) is spent over the next 
decade or so. But they are also 
the key to strengthening EU 
competitiveness and "shrink- 
ing” the continent Mr Kinnock 
reminds listeners that in the 
mid-l9th century, “single mar- 
kets were created by a trans- 
port revolution” In Britain, 
France and Germany. "The 
next 40 years will see us go 
through a similar process” at 
continental level through a 


public and private partnership 
“on a scale that has never been 
seen before”. 

While acknowledging the 
concerns of Europe's eco-lobby. 
be says the Greens must not be 
allowed to halt judiciously 
planned projects which will 
help save “billions and billions 
on wasted time and fuel" on 
Europe’s clogged highways. 

On state aid. the former 
Labour leaders seems surpris- 
ingly hawkish, even going as 
far as to hint that be may 
revisit the Commission's 
recent approval of FF20bn 
(£2.4bn) in fresh state aid for 
Air France, the beleaguered 
national carrier. 

“As far as Fm concerned [Air 
France] is an ongoing story. No 
decision could reasonably have 
been expected to be final, could 
it?" he says. 

The Air France aid is under 
challenge in the European 
Court from a British Airways- 
led coalition, it is only the larg- 
est sum in a torrent of govern- 
ment finance to national air- 
lines which Brussels is 
allowing in exchange for “last 
chance" restructuring plans. 

Mr Kinnock belie res a fmp 
judgment has to be made 
between subsidies which "are 
appropriate for the mainte- 
nance of vital services, or 


where they are giving an 
unfair competitive advantage". 
But he insists: “Unfair 
advantage has got to be taken 
on." 

Mr Kinnock is bound to be 
more Hka the UK's senior com- 
missioner. Sir Leon Brlttan. 
than Mr Bruce Millan, the for- 
mer Labour cabinet minister 
whom he is replacing. Sir Leon 
has repeatedly trumpeted his 
own and the Union's successes 
in competition and trade 
policy; by contrast, Mr Millan 
is almost allergic to publicity. 

Yet Mr Millan. a former sec- 
retary of state for Scotland, is 
widely credited with running a 
tight ship and making a suc- 
cess out of the EITs regional 
aid policy. 

Asked whether he will be at 
a disadvantage in Brussels, 
never having run a ministry in 
the UK, Mr Kinnock replies: “1 
would say, modestly, yes." But 
then, he smiles, "there are not 
many government departments 
that equate to the Labour 
party”. 

So what are the main quali- 
ties a commissioner needs to 
do a good job? For a moment 
be hesitates, then reaches for 
Antonio Gramsci. the Italian 
Marxist thinker, who spoke of 
the need to combine “optimism 
of the will, with pessimism of 



*mn t 


saw*? 


Neil Kinnock: "Transport is something tangible; it can have an 
application literally at street level.” 


the intellect". More practically, 
he admits that it also helps to 
be well connected with his 

Euro-Socialist confreres, who 
number 10 on the 21 -strong 
Commission. 

Mr Kinnock is clearly 
delighted to be able to team up 
with his wife. Glenys, who pre- 
ceded him into Europe and is 
already establishing a promi- 
nent voice as a newly elected 
European parliament member. 

He intends to make his views 


known across “a fairly broad 
spectrum”, from monetary 
union, through social policy, to 
EU expansion and reform - all 
issues that spark warfare 
among Britain's governing 
Conservatives- “There will be 
occasions," he says quietly, but 
be does not see himself primar- 
ily as a Brussels adjunct to the 
UK's tortured domestic debate 
on Europe. Advocacy, yes; but 
“the soap-box is not in my bag- 
gage". 


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Q* 


EUROPEAN NEWS DIGEST 



Leading members of France’s centrist PDF, part of the 
centre-right governing coalition, .warned yesterday t hey amid 
bade a candidate from another party to oext Jearis presdea- 
tial elections. The statement, by* former industry. ^minister 
Gerard Longuet among others, said they would n ot be hom ad 
to support a candidate from party ranks if it ^obstructed-a 
.gjTiff U* i-amHHate foam the coalition. The statement reflecte a 
move by many in the party to support Mr Edouard Bahadur, 
the prime minister and a member of the Gauffist RPR party, 
rather than Mr Valery Giscard d’Estaing, head of the UDF- - 
Polls show Mr Balladur ahead of Mr Jacques Chirac, the 
RPR leader and the only serious contender yet to have 
s fflTw-mnrgrf his candidacy- However, an RPR party congress 
has been for next weekend to endorse Mr Chirac’s 

candidacy. John Bidding, Paris 


Czechs set EU target dates 


The Czech Republic is to apply to join the European Union in 
1996 and expects to be a member by 1999, Mr V&dav Klaus, 
prime minister, said yesterday. Membership talks are expected 
to begin after the EU intergovernmental conference in 1996 
which Is to set the ground rules and timetable for membership 
for the countries of central and eastern Europe. Mr Klaus said 
the government would establish a special committee on Janu- 
ary 1 to oversee the application. The Czech Republic will join 
Poland and Hungary as the first post-communist countries to 
be considered for membership. Hungary and Poland have 
already applied. Vincent Boland, Prague ' 


Bosnian Serbs strike back 



The Bosnian Serb assembly yesterday met to declares state of 
war amid claims of Serb military gains against Moslem forces 
in the north-west The United Nations yesterday confirmed 
that Bo snian Serbs had’ re-taken territory round the Bfiiac 
pocket, a Moslem enclave designated a UN safe area. Yester- 
day’s meeting comes after Sobs have lost some 800 square 
kilometres of land in north and south-western parte of the 
country, Bosnian Serb political and military leaders last week 
recommended the assembly proclaim a formal state of war. 
They also declared a general mobilisation. After 31 months of 
war, it is rmrfpsrr what new measures Bosnian Serb dhipfc 
would take if the declaration is made. But it would probably 
increase their already tight control over the self-styled Serb 
state as it could include rule by decree or martial law. 

The Moslem offensive, launched two weeks ago, has raised 
fears of an aQ-out war as renewed fighting broke out mi 
several fronts. Sarajevo yesterday suffered its worst day of 
fighting for several months. Mr Thant Myint-U, UN spokes- 
man, denounced as “disgraceful” the sniper and mortar 
attacks which killed two teenage girls, a woman and a young 
boy in tiie Bosnian capital. In an attempt to salvage a ceasefire 
which has broadly held since February around Sarajevo, Gen- 
eral Sr Michael Rose, head of UN forces in Bosnia, yesterday 
“ ur gently" summoned the commanders of the warring sides to 
the city airport Laura SUber, Belgrade 


More Russian cabinet changes 


Russia's prolonged cabinet shuffle continued yesterday with 
the appointment by President Boris Yeltsin of two new deputy 
prime ministers: Mr Oleg Davydov, the foreign trade minister, 
and Mr Alexei Bolshakov, an industrialist Mr Yeltsin said the 
changes were part of a broad effort to bring “professionals and 
not politicians" into the government But Russian observers, 
perplexed by a week of new appointments and resignations 
which appear to have favoured reformers and conservatives in 
equal measure, are interpreting the changes as part of a 
complex power struggle between Mr Yeltsin and Mr Victor 
Chernomyrdin, his prime minister. 

By replacing Mr Alexander Shokhin as deputy prime minis- 
ter, Mr Davydov - who upset markets over the summer with 
an impromptu demand for debt forgiveness - will assume 
responsibility for all of Russia's foreign economic negotiations. 
Mr Bolshakov is to be responsible for relations between Russia 
and other members erf the Commonwealth of Independent 
States. He is a favourite of the conservative parliament and is 
expected to strengthen the “red barons”, the former Soviet 
factory directors, against the younger, academic market 
reformers in the cabinet Chrystia Freeland, Moscow 


German health insurance call 


The German government yesterday called on statutory health 
insurance bodies to cut contributions paid by workers and 
employers by January 1996, prompting a sharp reaction from 
the federation of health insurance funds (AOK). A government 
statement said contributions - averaging around 13 pcs* rent of 
salary, divided equally between workers and employers - 
should be lowered because the new state scheme of care for 
the aged would relieve the insurance funds of the need to 
support those needing special care after next April However, 
the AOK said contributions had been reduced last year and 
more than DM2bn ($1.3bn) passed on to individuals and 
employers. The AOK said it had no financial reserves which 
would justify cutting contributions, but would consider cut- 
ting them again in 1995. Andrew Fisher, Frankfurt 


Two left in Spanish phone race 


Last minute withdrawals in the contest to enter the Spanish 
mobile telephone market have narrowed the field to two 
consortia, which will deliver their bids on Monday. The 
licence, to be awarded before the end of the year, is the first 
significant step in a deregulation process that, over the next 
three years, will introduce cable television and end Telefon- 
ica's monopoly as a national basic telephony operator. 

The latest defections include Repsol and Gas Natural the 
two leading S panis h energy companies, and the US operators 
BellSouth and GTE. A rapid realignment leavs two consortia. 
One has Air Touch of the US and BT of the UK as its 
technological partners and is backed by Banco Santander and 
Banco Central Hispano as principal shareholders; the other 
groups the UK's Racal Vodafone anij Germany’s Veba with 
Banco Bilbao Vizcaya and retail chain Carte ingtes and media 
group Prisa among other partners. Tom Bums, Madrid 


ECONOMIC WATCH 


Pick-up in Danish industry 


Manufacturing sales vofcme 
annual percentage change 




to 


Danmark The volume of deliveries by 

Danish manufacturing indus- 
Manufacturing sales volume try increased by about 10 per 
annual percentage change cent in the third quarter from 

25 — the same period last year, 

■ 20 - I according to official statistics. 

■I r Third quarter export deliv- 

15 — — Trr eries (in current prices) were 

• w .__Ly\ up by 10 per cent and domes- 

s ./v; tic deliveries by 9 per cent. 

~ " re " ~ while new orders were up by 

0 — -J 15 per cent Producer prices 

.5 A increased by l per cent Hil- 

/ \T^ ' Barnes, Copenhagen 

v ■ The European Union's 

-is 1 r-L- i gross domestic product rose 

* ■ isaa 9* by a real 05 per cent from the 

scucKOatastraam first to the second quarter of 

, . .. , 1994- Italy, at 1.4 per cent, 

recorded the largest nse; Germany’s was the smallest at 0.5 
per cent. 

■ Pr oducer prices in Germany were unchanged in September 
from the previous month and were 0.8 per cent higher th a n a 
year earlier. 

■ France's current account showed a seasonally adjusted defi- 
cit of FFr29lm (£34.6m) In August alter a FFr7-65bn (fi9.it m) 
surplus in July. 


_ 10 A-V . 

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lechnology may be running streets ahead but Germany’s MSG venture finds a dead-end 

Brussels closes off a multimedia gateway 


By Emma Tucker in Brussels 

A tough application of 
European competition law led 
yesterday to the blocking of a 
pay-television joint venture 
between two German media 
companies, Bertelsmann and 
tfefi Kirch group, and the state 
telephone monopoly - as the 
Brussels Commission moved to 
to prevent what it saw as a 
potential distortion of three 
markets. 

But if the decision looked 
good for competition, it raised 
questions about the develop- 
ment of multimedia in Europe, 
and whether the Commission 
was trying to control an essen- 
tially uncontrollable and 
speedily evolving industry. 

For the Commission, the 
decision was dear-cut “If you 
have big players dominating 
the gateway to a market then 
you have to intervene," said a 
Commission official yesterday. 
“We have to ensure that no 
me shuts off the potential for 
new players coming in." 

Mr Karel Van Mierf, the 
competition commissioner, 
said Brussels blocked the de al 
because it considered, after 
discussions with more than 
100 companies and industry 
bodies, that the proposed con- 
centration was likely to create 
or reinforce a do minan t posi- 


tion in three separate markets. 
First, Bertelsmann and Kirch 
would dominate the market 
for pay-television services, dis- 
tinct from traditional televi- 
sion, as it is mainly finan ced 
by subscribers. The market is 
a potential pot of gold since 
from . next year, digitalisation 
is expected to lead to an explo- 
sion in the number of pay-TV 
programmes. 

Second, MSG - as the pro- 
posed merger was known - 
would have dominated the 
market for the technological 
services associated with 
pay-TV operators, limiting if 
not preventing the entry of 
competitors. These services 
include the provision of decod- 
ers, leased to subscribers to 
unscramble those services for 
which they have paid. They 
also include “access control 
systems” which enable opera- 
tors to restrict pay-TV channel 
reception to subscribers. 

Third, the Commission 
signed that the merger would 
have allowed Deutsche 
Bundespost Telekom, the state 
telephone monopoly, to rein- 
force its do minan t position in 
the market for cable network 
services. Mr Rolf-Dieter Leis- 
ter, chairman of Deutsche 
Telekom's supervisory board, 
reacted by saying he consid- 
ered the decision a blow for 



Karel Van Miert: feared distortions in three markets 


the German pay-television 
market. “We want to get a 
market moving which hardly 
exists in Germany and Europe, 
otherwise this technology will 
be introduced in Germany 
much later.” 

Industry analysts agreed 


that outdated competition and 
ownership rales, as applied by 
national governments and the 
Commission, could hinder the 
development of an industry 
where technology is running 
streets ahead of government 
thinking. “The message to 


industry from this decision is 
that here is yet another thing 
which is going to delay the 
generation of revenue from 
the digital superhighway,'’ 
said Mr John Scaife, media 
consultant at Charon Capital 
in London. 

The key to development, 
argues Mr Scaife, is the combi- 
nation of delivery networks 
together with ownership of 
programmes and films. 

Such a combination would 
allow companies to package 
services to customers, offering 
them, for example, both 
telephone and television ser- 
vices to justify the price of 
subscription. 

Yesterday, the Commission 
was adamant “Telekom owns 
most of the cable network in 
Germany and controls its 
development” it said. “It also 
controls the return channels 
necessary for interactive ser- 
vices, and has direct access to 
more than 4m cabled house- 
holds; Bertelsmann and Kirch 
already have Premiere and 
own incomparable programme 
resources; moreover, Bertels- 
mann is a major operator of 
book dubs.” 

“No competitor has such 
advantages nor could reason- 
ably enter the MSG market" 
it concluded. 

Last-minute concessions 


offered by the merging parties 
were not accepted by the Com- 
mission. These included devel- 
opment of a system whereby 
competitors could have used 
the decoders, and an undertak- 
ing not to discriminate against 
other pay-TV operators when 
it came to renting contracts 
for decoders, and use of com- 
mercial information. 

“These undertakings axe in 
fact a mere declaration of 
Intent not to abuse a dominant 
position on the market for 
administrative and technical 
services to the detriment of 
competitors,” said the Com- 
mission. 

Lastly, MSG undertook to 
develop the digital cable net- 
work to ensure that there was 
no shortage of transmission 
capacity. 

This too was rejected by the 
Commission, as too difficult to 
check and already linked to 
the regulatory obligations 
imposed on Telekom. 

With the development of dig- 
ital TV technology set to 
transform television services 
over the next few years, the 
Commission is likely to have 
to consider other complicated 
multimedia cases. But as the 
technology changes and 
evolves, consideration may 
need to be given on how best 
to apply competition rules. 


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Published by The Financial Tines 
(Europe) GmbH, Nibelungenplaiz 3, 
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Telephone ++49 69 156 850, Fax ++49 
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13 44 41, Fa* 33 9$ 53 35. 


$lm to give away - in cyber-bucks 


By Alice Ftawsthom 

Wanted: 10,000 cyber-junkies to 
participate in an experiment to 
test a new electronic payment 
system specially designed for 
use on the Internet. Each volun- 
teer is required to spend f!00 m 
cyber-bucks during the experi- 
ment 

DigiCash. an Amsterdam- 
based company that specialises 
in developing new electronic 
cash payment systems, has 
invented a form of digital 
money with which people can 
pay for products or services 
bought on the Internet, the 
international system of com- 
puter networks. 

Mr David Chaum, a former 
academic - who taught at Uni- 
versity of California and New 
York University before becom- 


ing managing director of Digi- 
Cash, said the digital payment 
system - dubbed E-Cash - had 
been devised for use by con- 
ventional hanks as an alterna- 
tive form of payment on the 


the trial by allowing the Digi- 
Cash volunteers to pay for 
their products in apocryphal 
‘cyber-bucks’ using the E-Cash 
system. 

During the trial DigiCash is 


During the trial each volunteer can 
withdraw $100 from the DigiCash 
bank in digital coins, each of which 
is in the form of a numerical code 


Internet that protects the pri- 
vacy of the user. 

DigiCash has for the past 
week been, operating E-Cash on 
an experimental basis. A num- 
ber of commercial companies, 
including Encyclopedia Britan- 
nica and Wired, the technology 
magazine, are participating in 


giving away a total of $lm in 
cyber-bucks to up to 10.000 vol- 
unteers, Bach of whom will be 
allowed to spend $100. Each 
participant can withdraw their 
$100 from the pi gi Cash ‘bank’ 
in ‘digital cams’, eftch of which 
is in the form of >a numerical 
code. 


If the volunteers want to 
access an article from Wired 
on the Internet, they pay for it 
with digital coins. Wired then 
verifies that the payment is 
valid by checking the numeri- 
cal code of each 'coin' with the 
DigiCash bank through the 
Internet. If the bank 
approves, the purchase goes 
ahead. 

DigiCash hopes that commer- 
cial banks will offer E-Cash as 
an alternative to their stan- 
dard payment systems. Mr 
Chaum said he hoped soon to 
conclude negotiations with a 
UK bank which is interested in 
introducing E-Cash. A conven- 
tional bank would operate the 
system in the same way 
as the DigiCash hank in the 
trial- 

Commercial transactions on 


the Internet are currently paid 
for with bank debit or credit 
cards. The main advantage of 
the E-Cash format to users is 
that it enables them to conduct 
their Internet transactions in 
privacy. 

The numerical code an each 
digital coin is calculated 
according to a mathematical 
formula devised by DigiCash. 
This ensures that the bank 
sees a scrambled version of the 
user's original code and there- 
fore, although it validates each 
‘coin’, it does not monitor indi- 
vidual transactions. 

So far the E-Cash trial is 
going very well, according to 
DigiCash After only one week 
on-line it has signed up 1,000 
volunteers and new recruits 
are flooding in at the rate of 80 
or 90 a day. 


Battle joined 
forWEU post 

Bruce Clark on differences 
within Europe’s defence club 

otV 


The transformation of\the ing in the Netherlands of WEU 
nine-nation Western European foreign and defence ministers, 
Union into a full blooded which will also hear nails for 
defence dub will get undery rapid progress towards a cam- 
way today with an ill tempered \ 
contest for its top job. 


Whoe ver w ins the race to 

become WEU secretary -general 

will have to reconcile differ- 
ences between Britain and 
many of its continental part- 
ners over the route and pace of 
Europe's path towards greater 
self-sufficiency in defence. 

The winner will also be 
struggling to settle another, 
even tougher argument - 
between the WEU, including 
Britain, on the one hand and 
the US on the other - over the 
terms on which the US will 
“lend" military hardware to 
European defence missions. 

Having failed to reach con- 
sensus on who will be the next 
secretary-general, ambassadors 
of the nine member states will 
be voting in Brussels on Ital- 
ian, Portuguese and Spanish 
candidates. If there is dead- 
lock, the Dutch incumbent, Mr 
Willem van Eekelea, could 
remain in office. 

The job seems certain to be a 
substantial one, because the 
principle of reviving the WEU 
as the European pillar of Nato, 
and the defence arm of the 
European Union, is no longer 
questioned by any of its mem- 
bers. 

The 40-year-old WEU - 
which groups all ED members 
except Denmark and Ireland, 
and will soon incorporate 
Greece - binds its members to 
defend one another in even 
stronger terms than the foun- 
ding treaty of Nato. 

But in practice, Nato has 
largely overshadowed the 
European dub, at least until 
last January when the US told 
its allies to take more responsi- 
bility for their own defen ce. 

The ranriidates for the WEU 
job are two diplomats - Mr 
Giovanni Jannuzzi of Italy and 
Mr Jose Cutflheiro of Portugal 
- and Mr Enrique Baron 
Crespo, a Spanish Socialist pol- 
itician. 

If today’s vote yields a clear 
result,, the winner will be 
endorsed at next week's meet- 


mon European defence policy. 
\ Britain, which used to argue 
that a strengthened WEU 
would alienate the US, is now 
stressing that it fully supports 
the idea of giving the Euro- 
pean body some extra punch. 

In practice, that would 
mean that certain defence 
tasks - in which the Euro- 
peans wanted direct involve- 
ment but the US did not - 
would be shouldered by the 
WEU, which would borrow US 
military hardware from Nato 
as necessary. 

However, the US wants to 
retain considerable say in any 
missions for which it is provid- 
ing military assets, and ideally 
the right to pull its equipment 
out if a more pressing need 
arises elsewhere. 

The French - and, as of 
recently, the British - argue 
that the new arrangement will 
work only if the Europeans can 
count on being able to borrow 
Nato's military hardware 
whenever it is required. 

“There would have to be a 
presumption, at least, that 
Nato assets would be avail- 
able." said a UK diplomat 

Despite moving closer to 
France on some issues. Britain 
is putting the brakes on pro- 
posals to issue a toughly 
worded statement on a com- 
mon European defence identity 
in the near future. 

It says this would preempt 
preparations for the 1996 con- 
ference on the future of the 
European Union. 

London is also talking down 
the idea of an early 24 -nati on 
summit grouping the WEU's 
full members and nations with 
associate or observer status. 

In today’s vote, Mr Cutil- 
heiro expects the backing of 
Britain and probably the 
Netherlands, while Mr Jan- 
nuzzi enjoys French support 
and Is hoping that the Ger- 
mans - waverers until the last 
minute - will rally to his 
cause. UK diplomats have 
hinted that they would prefer 
Mr Jannuzzi to Mr Baron. 


--- "4 


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,ANC1AL TIMES THURSDAY NOVEMBER 


10 1994 


NEWS: US MID-TERM ELECTIONS 


Losers and winners in polls which dealt a severe blow to Clinton and the Democrats 




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North (defeated in Virginia); Jeb Bush comfortedfegiparent loser in Florida): jubilant Michael Patrick Flanagan (victor over Dan Rostenkowski in Chicago); dancing Teddy Kennedy (survivor in Massachusetts and. Tom Foley (threatened in Washington) 

M/v'nmi /t 4-n lr A/\¥rn*« fni* fhn Danilhlinoric Republicans 


A seismic takeover for the Republicans 


By George Graham hi W ashi ngton 

Even if the Republican party had 
fallen short of complete control of the 
Senate and the House of Representa- 
tives, the congressional power struc- 
ture was already well on Its way to a 
substantial shake-up because of the 
retirement and defeat of a number of 
party leaders and powerful committee 
chairmen. 

But with outright majorities in both 
chambers, the Republicans will ma k e 
a seismic takeover of the committee 
apparatus. 

Most Republican candidates for 
House seats signed the “Contract with 
America” prepared under the leader- 
ship of Congressman Newt Gingrich, 
l the architect of the Republican vie- 
‘,tary r who will almost certainly take 
over as Speaker of the House. 

The Contract pledges to bring to the 
House floor in the first 100 days of the 
new Congress 10 substantial bills, 
including measures to cut income and 
capital pnw taxes, increase defence 
spending, provide for a balanced bud- 
get amendment to the constitu tio n, 
toughen penalties for criminals, cut 
back on welfare payments and set 
term limit s for members of Congress. 

But many House Mnijjdste have 
been running away from the details of 
the Contract - and even its chief 
draftsmen say they promise only to 
bring these measures to a vote, not to 
pass them. 


ELECTION DIGEST 


Republican Senators have also been 
sceptical about the proposals, which 
do not include specific spending cuts 
to meet a balanced budget require- 
ment, anA the Republican leadership 
structure in the Senate is likely to be 
much more moderate, particularly on 
economic issues. 

Senator Bob Dole, the Republican 
leader, will be flanked by Senator Phil 
Gramm, a right winger with uncon- 
cealed presidential ambitions who 
chairs the Republicans’ Senate cam- 
paign committee. 

Other right wingers will take over 
some important posts, notably Sena- 
tor Jesse Helms, the extreme conser- 
vative from North Carolina at the 
head of the foreign relations commit- 
tee, and Senator Alphonse D'Amato. 
the Republicans’ chief attack dog on 
the Whitewater issue, as chairman of 
the banking committee. 

But major economic policy posi- 
tions in the Senate will be held by 
some of the party’s leading moder- 
ates. 

Senator Robert Packwood, although 
politically weakened by charges of 
sexual harassment which are still 
under investigation, is expected to 
chair the Senate finance committee, 
with jurisdiction over all tax-related 
matters. However, Senator Gramm 
has hinted that he might seek to 
elbow Mr Packwood aside. Mr Pack- 
wood’s fellow Oregonian, Senator 
Mark Hatfield, will take over the 


appropriations committee, which con- 
trols government spending. 

Moderates wifi also head the labour 
committee (Senator Nancy Rasse- 
haum) and the environment and pub- 
lic works committee (Senator John 
Cbafee). Senator Larry Pressler. a 
stiff-necked South Dakotan with an 
unpredictable set of beliefs, will take 
over the commerce committee, where 
he is likely to be much more of a free 
trader and much less of a regulator 
than Senator Ernest Hofiings, the cur- 
rent rfiairman 

Perhaps the determining factor In 
the direction of the Republican Con- 
gress will be tiie influence that Sena- 
tor Pete Domenici of New Mexico 
manage to wield as chairman of the 
budget committee. A fiscal conserva- 
tive, almost to the point of obsession. 
Mr Domenici has been one of the few 
Republicans willing to contemplate 
unpopular measures such as tax 
increases and cuts in entitlement pro- 
grammes such as social security and 
Medicare in his desire to control the 
budget deficit 

Mr Domenici is therefore likely to 
play a central role In curbing the 
more wayward Republican promises 
of tax cuts and in tackling the 
long-term fisca l imhalanrp that the 
US faces in the next century if it does 
not alter the toms of social security 
and Medicare. 

He is aligned with his House Repub- 
lican nnll«ig iiM on the need for a 


line-item veto but could clash with 
them over the supply side premises erf 
the Contract with America's tax cut 
proposals. Congressman Dick Armey, 
the chief backer among tbe House 
Republicans of a flat income tax rate, 
says the cuts will cost S130bn to 
$150bn, but says the Republicans will 
simply change the way the Congres- 
sional Budget Office scores tax mea- 
sures to assume that tax cuts will pay 
for themselves by stimulating the 
economy - a logic which failed to 
balance the budget in the Reagan era. 

Mr Armey currently ranks third In 
the Republican hierarchy, but with 
the retirement of Congressman Bob 
Michel, the current minority leader, 
and the elevation of Mr Gingrich to 
Speaker, he is likely to take the num- 
ber two post of majority leader, now 
held for the Democrats by Congress- 
man Richard Gephardt. 

He will be backed on most tax 
issues by Congressman Bill Archer, a 
fellow Texan who will probably 
become chairman of the House Ways 
and Means committee, and by Con- 
gressman John Kasich. who will take 
over the budget committee. 

In s ome other key House commit- 
tees, however, the Republicans are 
expected to override the normal 
seniority rules that have prevailed in 
the past 

At the appropriations committee. 
Congressman Joseph McDade is the 
Mninr Republican but his foftrfinpnt 


on corruption charges is expected to 
block him from the chairmanship. 
The second ranking Republican, Con- 
gressman John Myers of Indiana, may 
be too moderate for the taste of the 
new House majority. 

Congressman Jim Leach of Iowa, a 
moderate but another leader of the 
Whitewater pursuit team, will become 
chairman of the hanlring Committee, 
ar>H Congressman Benjamin Qiimm 
of New York, one of the most centrist 
members remaining in the Republican 
party, will chair foreign affirirs. 

But Mr Gingrich is expected to push 
for a close ally, Congressman David 
Dreier of California, to head the Rules 
committee, which plays a crucial role 
in deciding which legislation comes to 
the floor, and with what amendments, 
rather than Congressman Gerald Solo- 
mon, who is now the senior Republi- 
can member of the committee. 

Congressman Tom Bliley of Vir- 
ginia, and not senior Republican 
Carlos Moorhead, is also expected to 
take over the energy and commerce 
committee, tbe barony created by tbe 
all-powerful Congressman John Din- 
ged. Mr ntngetl’s loss of the chair- 
manship could prove one of the most 
important changes. tUk claim to juris- 
diction over virtually everything has 
blocked many legislative proposals, 
and his departure could pave the way 
for the measures such as repeal of the 
Glass -Steagall act, which separates 
investment and commercial banking. 


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Kennedy clan 
bucks the trend 

While many Democrats were buried in Tuesday's landslide. 
Kennedy clan candidates proved resilient, writes Nancy 
Dunne. Senator Edward Kennedy, the family’s patriarch, was 
in danger of losing his Senate seat for the first time since 1962 
but ultimately wan handily against a young, telegenic political 
neophyte, Mitt Romney, son of a former Michigan governor 
and presidential candidate, George Romney. 

Senator Kennedy was once hailed by President John Kenn- 
edy as the best politician in the family. Now aging and 
overweight he rallied framer aides and old friends to his 
standard and mortgaged his house to raise funds. 

Four members of the younger Kennedy generation also were 
in contests. Two ran and won seats in the US House of 
Representatives - Joseph Kennedy, son (rf the slain Robert in 
Massachusetts, and Patrick Kennedy, son of Edward, in Rhode 
Island. Mark Shriver, son of the first Peace Corps director 
Sargent Shriver and Eunice Kennedy, wan a seat in the 
Maryland House of Delegates. Kathleen Kennedy Townsend, 
daughter of Robert is in a race for Maryland lieutenant 
governor that yesterday was too close to call. 

Win and lose for Bush sons? 

The younger generation of Bushes, sms of the former presi- 
dent bad a win and an apparent loss. 

fix Texas, George W Bush, the eldest son, felled Governor 
Ann Richards, who once ridiculed President Bush for having 
been “born with a silver foot in his m o u th.” Although a 
popular incumbent, Ms Richards proved susceptible to a 
Republican tidal wave powered by promises to reduce taxes 
and crime. Mr Bush, owner of the Texas Rangers baseball 
team, won on his first try for office. The attractive, prolific 
Bush children and grandchildren, played major roles in their 
father’s fflTnpirigns . 

Another Bush son, Jeb, apparently lost in a very close race 
against Florida Governor Lawton Chiles. In a long political 
career, Ghfles - a former senator - has never lost a race. 

Resurrection for Marion Barry 

An -amazing political resurrection was achieved by Mr Marion 
Barry, who regained tbe Washington DC mayoralty four years 
alter leaving office to serve a six-month prison sentence on 
drug char ges. Widely seen among African-Americans as just 
one of a series of black public officials targeted by a white 
prosecutors, he drew support from many middle class blacks, 
who mi ght otherwise have opposed a disgraced public o ffic ial. 
Hie opponent, Ms Carol Schwartz, turned in a surprisingly 
strong showing for a white Republican, winning about 44 per 
cent of the vote in a city that is 10-1 registered Democrats. 

Health, gambling and false teeth 

Around the country, voters cast ballots on dozens of measures 
[ over issues tanging from healthca r e to gambling and false 
teeth. 

In Oregon, voters ware dose to allowing doctors to assist in 
suicides of the ter minally ffi. In California, voters rejected a 
j taxpayer-funded state healthcare system and a referendum, 
backed by the tobacco industry, which would revase local 
gmniririg curbs. limits an the terms officials can serve passed 
in five states - Alaska, Idaho, Maine, Nebraska and Nevada. A 
total of 21 states have now approved c ongress ional term limi t s , 
but the initiati ves are subject to constitutional chal len g e in 
the coarts. 

Term limits vary from state to state. Colorado limited 
congressmen to three consecutive terms. Nebraska imposed 
j limi ts of three conse cutive House terms or two cxmsecutive 
S enate terms. Nevada voters would limit senators to two 
six-year terms and House members to- three two-year terms. 

Florida voters defeated a proposal to legalise gambling casl- 
I nos. hi Washington state, dental tec hnicians won permission 
to fit and install false teeth, a right now limited to dentists. 


Scramble to get Gatt through 


By Nancy Dunne 
in Washington 

Mr Newt Gingrich, the new 
House Speaker-to-be, has prom- 
ised to work with the Clinton 
Administration to pass the 
Uruguay Round Implementing 
legislation when it comes up 
for Congressional approval in 
three weeks, according to a 
senior White House offiriaL 
Mr Leon Panetta, White 
House chief of staff, said in. a 
CNN interview yesterday Gatt 
passage, the first test of bi-par- 
tisanship in the new order, 
poukl “send a very important 
signal" which the president 
could carry into summits with 
the Pacific Rim countries next 


week and Latin American lead- 
ers on December 9-10. 

However, that signal has yet 
to be sent directly by Mr Ging- 
rich or Senator Robert Dole, 
who will become Senate major- 
ity leader. Business lobbyists 
yesterday were scurrying from 
meeting to meeting planning 
strategies to secure passage 
this year. It is the outgoing 
Democratic-controlled Con- 
gress whJteh will vote on the 
Gatf legislation, but party 
labels matter little on trade. 
Populists on both sides of the 
political divide are opposing 
the proposed World Trade 
Organisation, which the Uru- 
guay Round creates. 

The implementing le gislatio n 


is being depicted as “a budget 
buster,’' riddled with protec- 
tionist clauses and “sweetheart 
deals." At least $40bn (£24jhn) 
of the projected lost tariff reve- 
nue has not been offset by new 
taxes or programme cuts. Sen- 
ate rules require 60 senators to 
approve a budget waiver before 
implementing legislation can 
go to the floor. 

Mr Dole is reported to have 
said be would like the legisla- 
tion re-written next year, but 
that was before the mid-term 
election. He has since made 
conciliatory noises about bi- 
partisan cooperation. 

Mr Mark Anderson, trade 
specialist at the AFL-CIO, the 
labour umbrella organisation. 


has little doubt that Mr Dole 
win in the end cooperate with 
the president on Gatt. “Dole 
has a long history on free 
trade. . . I don’t think he’ll turn 
his back on the Business 
Roundtable or agribusiness-" 
Opponents are arguing that 
“the fired and retired" mem- 
bers who return for the “lame 
duck’ session have not the 
right to vote on an issue (rf 
such economic importance as 
the Gatt package. They are 
alert for signs of business pay- 
offs to congres sm en and con- 
gressional staff in search of 
new jobs. Pro-Gatt lobbyists 
believe the election has left 
members free “to vote their 
cons ci ences". 


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Big money still garners the big vote 


OWaboma 


By George Graham 

Money has always talked in US 
elections, and it spoke as load 
as ever this year in the most 
expensive campaign on record. 

With a few notable excep- 
tions, candidates with tbe most 
money to pay for television 
adver tising ; direct mailing and 
telephone campaigning won 
their races, and lobbying 
groups that helped finance 
them are looking forward to an 
open door at their Washington 
offices. 

Republicans won all nine 
Senate seats left open by retire- 
ments, and in seven raised 
more money than titer Demo- 
cratic opponents. In the two 


exceptions, Minnesota and 
Oklahoma, the fundraising 
advantage was not crushing. 

Republicans who unseated 
incumbent Democratic sena- 
tors in Tennessee and Pennsyl- 
vania also outraised their 
opponents. Mr Rick Santorum, 
in Pennsylvania, drew hea vQy 
on the political action commit- 
tees, or PACs, through which 
companies and lobbying 
groups donate to candidates. 

PACs have in the past 
heavily favoured incumbents, 
regardless of party. But Repub- 
lican leaders have been twist- 
ing arms heavily recently, 
warning lobbyists they would 
be frozen out if they continued 
to give to Democrats. 


Big winners include the 
National Rifle Association, 
which turned its fury on sev- 
eral old allies who had voted 
for President Bill Clinton's 
crime bilL 

The NRA’s most prized tro- 
phy would be Congressman 
Tom Foley, the Speaker, who 
also voted for the crime bill 
and who was fighting to sur- 
vive in in Washington state. 

Many candidates, however, 
dipped deep into their own 
pockets to pay for their cam- 
paigns. By the end (rf October, 
according to Federal Election 
Commission returns, Senate 
candidates had spent more 
than $50m (£3Q.4m) of their 
own money. Half of that came 


from Mr Michael Hoffington, 
who took his Texas oil fortune 
to California to run against 
Senator Dianne Feinstein. He 
lost, but the $2Sm he spent 
took him close to uprooting a 
popular and effective senator, 
despite his non-existent record 
of achievement, vague political 
views and employment of an 
illegal alien as his nanny. 

Ms Feinstein had to spend 
$2J)5m of her own but mostly 
raised money from PACs. 

One oddity was Mr Oliver 
North, controversial former 
marine who lost his bid to oust 
Senator Charles Robb in Vir- 
ginia. Mr North raised more 
than $15m, four times as much 
as Mr Robb. 


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Southerners have previously said that they would ‘rather vote for a yellow dog’ than a R epublican 

South becomes cornerstone of House takeover 


By Goorge Graham 

Hie cornerstone of the Republican 
takeover of the House of Representar 
lives was a sweeping change in the 
southern US. 

Ever since the Civil War, the South 
has traditionally shunned President 
Abraham Lincoln’s Republican party. 
Most southerners said they would 
“rather vote for a yellow dog” than a 
Republican. 

Southern Democrats stood far to 
the right of their northern colleagues 
in their political views, blending 
social conservatism with heavy pork 
barrel spending. 

Since the 1960s, when the 
Democrats became more closely 
identified with the fight for 
black civil rights, the Republicans 
have made Inroads in the Deep 
South and tbe border states 


such as Kentucky and Missouri. 

They started with presidential 
elections in which southern states 
have generally favoured Republican 
candidates from Senator Barry 
Goldwater onwards, and continued 
in statewide elections for governor 
and senator. 

That trend carried on in Tuesday's 
elections, with Republican candidates 
taking over as governors in Alabama, 
Tennessee, Kansas, and with both 
Tennessee Senate seats moving into 
the Republican column. Tennessee's 
new governor is the first the state 
has ever elected who was bora north 
of the Mason-Dixon fine, the tradi- 
tional divide between North and 
South. 

Perhaps as telling, the Republicans 
were able to hold on to the governor- 
ship of South Carolina, though by the 
narrowest of margins, even though 


their candidate. Mr David Beasley, 
aroused hostility with radical right- 
wing positions backed by a Christian 
evangelical coalition. 

One rare success for the Democrats 
was Governor Zell Miller’s successful 
campaign for re-election in Georgia, 
defeating the strongest challenge the 
Republicans have mounted in that 
state since the Civil War. 

But Republicans have in the past 
found it much more difficult to make 
headway at the local level, leaving 
the Democrats dominant in tiie House 
of Representatives, as well as in state 
legislatures and county courthouses. 

“Used to be, if you wanted to win. 
you ran in the Democratic primary," 
says Mr Beniie Castleman, who is the 
only Republican commissioner 
elected in his Tennessee county in the 
last hundred years. 

That began to change in this elec- 


tion. Helped by the retirement of old 
Democratic legislators such as Con- 
gressman Jamie Whitten (rf Missis- 
sippi, tbe Republicans gained 11 
House seats to five deep Sooth states, 
three more in Oklahoma, two in 
Texas and one each in Tennessee 

Knngnc 

Hie biggest swing came in North 
Carolina, where the cigarette tax pro- 
posed in President Bill Clinton’s 
healthcare reform plan added to the 
Democ rats’ problems in tobacco- 
growing districts. 

North Carolina also provided per- 
haps the most striking evidence of a 
lasting change in the South's party 
alignment: a Republican takeover of 
the state house and Serrate - the first 
time this c en t nry that they have con- 
trolled a state legislature in the 
South. They also won control of the 
Florida Senate. 


Many southern Democrats have 
voting records in Congress that are 
closer to the Republicans than to the 
rest of the Democratic party, and 
some are expected to follow Senator 
Rich ard Shelby of Alabama’s party 
switch yesterday. Congressman Newt 
Gingrich has warned that the Repub- 
licans wDl target conservative south- 
erners who do not switch sides in the 
1996 election. 

And with the “yellow dog Demo- ib 
crate 1 ” stranglehold broken, new can- ^ 
(Relates win fed In years to come that 
they can run as Republicans and 
have a good chance of winning. 

Southern Democrats are now as 
likely to be relativdy leftwing black 
or Hispanic politicians as conserva- 
tive "boll weevils". 

Tbe South’s realignment conld also 
move the Democratic party further to 
the left. 









■A 


“Washing 

Kin, 




financial times 


Thursday November 10 mm> >: * 


NEWS: US MID-TERM ELECTIONS 


Big Apple fails to 
save political giant 


By Richard Waters and 
Patrick Harveraon In New York 

New York city turned out in 
farce on Tuesday to vote for 
Mr Mano Cuomo, the state’s 
governor for tbe past 12 years 
and a giant on the nation al 
political stage. The trouble for 
city dwellers was. the rest of 
the state did not 
The narrow vote which 
ousted the 62-year-old Mr 
Cuomo, installing in his place 
Mr George Pataki, a 
little-known Republican, 
revealed a starker division 
between voters in the city 
those in the suburbs up- 
state New York than at any of 
the previous three elections, all 
of which Mr Cuomo won. 

It also threatens to usher in 
a tur bulent period in relations 
between state and city in New 
York - and a degree of animos- 
ity that could turn the city's 
current budgetary problems 
into a bigger headache. 

The reasons for Mr Cuomo's 
defeat are not difficult to iden- 
tify. “Hie New York economy 
has dramatically lagged behind 
the national recovery," says 
Mr David Schulman. an econo- 
mist at Salomon Brothers in 
Manhattan, “And Cu o m o hoc 
been around too long." 

The second consideration 


was probably tfae strongest in 
bringing to a halt one of the 
most prominent liberal Demo- 
cratic political careers in the 
US. 

Mr Cuomo's accomplished 
oratory and political skills 
Dually wore thin with an elec- 
torate which faii»d to see 

The question 
now is whether 
the victor will 
take revenge 
op New York 

clear signs of improvement 
after the last recession. 

Mr Cuomo twice came close 
to seeking the Democratic 
nomination for president, most 
recently in 1992. He was also 
offered, but turned down, a 
seat on the US Supreme Court 
last year. Mr Pataki, mean- 
while, benefited from not being 
Mr Cuomo. 

A former mayor of the small 
town of PeekskiU. he is less 
well known than his political 
godfather. Senator Alfonse 
D ’Amato. The New York 
Republican senator single- 
handedly polled Mr Pataki 
from obscurity when he threw 


his. weight behind the state 
senator earlier this year. 

Otherwise, the new governor 
has preached a bland and gen- 
erally vague mix of policies 
dining bis campaign He has 
pledged to champion the rein- 
troduction of the death penalty 
in New York, build more pris- 
ons and reduce taxes. As a tax- 
cutting Roman Catholic from 
the prosperous Westchester 
suburbs, Mr Pataki is not the 
sort of person most likely to 
appeal to city dwellers. 

Adding to the city’s anxiety 
was the decision by its Repub- 
lican mayor, Mr Rudolph Giuli- 
ani, two weeks ago to cross 
party lines and back Mr Cuo- 
mo's campaign. Mr Giuliani 
and Mr D ’Amato are old rivals. 

The question now is whether 
Mr Pataki and his political 
mentor will take their revenge. 

Mr Lewis Lehnnan. a New 
York businessman who ran 
against Mr Cuomo in an earlier 
gubernatorial election, says 
that the city could suffer from 
Mr Giuliani's endorsement. 
"New York city has been subsi- 
dised by the taxpayers of 
upstate New York for genera- 
tions. While that will not 
entirely be reversed, growth of 
those subsidies should end." 

At the very least, it will 
make life difficult for Mr Giuli- 



Poiitical retreat; Mario Cuomo bows out as New York's state governor after 12 years in office 


ani as he grapples with a bud- 
get deficit that is expected to 
top $lbn (£600m) in each of the 
next two years. 

"It’s likely to make tbe city's 
budgetary problems more diffi- 
cult to deal with," says Mr 


Felix Rohatyn, a senior partner 
at Lazard Fibres. 

Around two thirds of the 
state’s budget goes to local 
governments in the form of 
aid, roughly half to New York 
city. If Mr Pataki pushes ahead 


and cuts the state’s top income 
tax rate, says Mr Rohatyn, it 
will add $50Om a year to the 
city’s deficit. "It could be detri- 
mental to its businesses, and 
drive more people away from 
the city." he says. 


California goes from ballot box to courtroom 


By Jurok Martin ft Washington 

The action moved from the ballot box 
to the courtroom yesterday as law- 
suits were filed in California to inval- 
idate tiie electorate's approval of the 
referendum denying soda! services to 
Illegal immig rants. 

Ike measure, known as Proposition 
187, passed easily, by 59-41 per emit 
This was pretty close to the margins 
it commanded in public opinion polls 
when ft first qualified for the ballot 
in the summer and much bigger than 
projected in surveys just before elec- 
tion day. 

Strength of support for tbe Proposi- 
tion- was dearly a contributory factor 
in the easy re-election of Governor 
Pete Wilson over Democratic con- 
tender Ms Kathleen Brown and to the 
n ar rowness of the defeat of Republi- 


can Congressman Michael Huffington 
by Senator Dianne Femstein. 

Both Republican candidates had 
been vocal advocates in favour and 
both Democrats against. It also 
helped the re-election on Tuesday of 
Mr Dan Lungren, the Republican 
state attorney general, who only 
came out in support on Monday. 

The proposition’s passage also 
prompted an angry response from the 
Mexican government yesterday. A 
foreign ministry statement con- 
demned “all open and undercover 
forms of discrimination and any 
xenophobic practises”. 

Legal challenges to its constitution- 
ality and legality derive from its two 
principal clauses - the denial of edu- 
cation and noi Ha ne r ggncy healthcare 
to iifcp i Immigrants and the obliga- 
tion on teachers, doctors and hospi- 


tals to report to the federal govern- 
ment any Individual suspected of ille- 
gal status. 

Mr Demetrios Papademetriou. an 
immigration expert at the Carnegie 
Endowment in Washington, who has 
helped prepare one legal challenge, 
said the suit was “very broad” and 
based on the contention that the 
proposition would not accomplish 
what It claime d to do - force the 
repatriation of the estimated 1.6m 
illegal immigrants in California. 

He predicted that the state legal 
processes could be finished “quite 
quickly”, though an ultimate judg- 
ment by the OS Supreme Court, 
which would take much longer, is 
considered likely, lb* Papademetriou 
described Proposition 187 as “a nasty 
primal scream*. . 

A Supreme Court ruling in 1982; 


Plyler v Doe. found that the 14th 
“equal protection” amendment to the 
OS constitution prohibited a state 
from denying admission to schools to 
any child living within its borders. 
Federal education law also requires 
that government funds be withdrawn 
whenever confidential information is 
revealed without consent of parents. 

A problem still to be addressed in 
the lawsuits is tbe consequences of 
forcing out of school the estimated 
300,000 sons and daughters of illegal 
immigrants in California. Opponents 
of the proposition argued that this 
was certain to contribute to increased 
juvenile delinquency. 

Governor Wilson has already cra- 
ceded the inevitability of lawsuits 
and Mr Lungren last week said he 
would defend the proposition in court 
because he was obliged by Us office 


so to do. But he added that be lacked 
the authority to prosecute teaching 
and medical professionals accused of 
not informing on illegal immigrants. 

Mr Wilson, along with some other 
governors from states with high lev- 
els of immigration, has already sued 
Washington to require the federal 
government to cover state expendi- 
ture on the health, welfare and edu- 
cation services provided to not only 
illegal immigrants but also a new 
flood of refugees and asylum seekers. 

Hie principal immigrant recipient 
states, after California, are Florida, 
Texas, New York, New Jersey, Illinois 
and Arizona. Only In Florida has 
political controversy remotely compa- 
rable to that in California been evi- 
dent a reflection in part of different 
economic conditions and political 
traditions. 


AMERICAN NBA/S DIGEST 


Chile inflation 
at annual 8.3% 

rhfle will have single digit inflat ion this year for only the 
second time in 30 years. Mr Eduardo Aninat, finance minister, 
said in London yesterday that restrictive economic policies 
bad brought inflation down to an annual 3-3 per cent, from 
13.7 per cent when the government took over in March. The 
government's 1994 target of 10-11 per cent would be undershot, 
and the 1995 target might have to be revised downwards. 

Chile had single digit annual inflation for a single year in 
1980 but the exchange rate policy that brought it about was 
unsustainable. The previous year of single digit inflation was 
1961. Growth this year will slow to 4^ per cent - with 
consumer expenditures slowing - but should expand to more 
than 6 per cent next year. Next year's overall budget surplus 
should be about l per cent, compared with 2 per cent this year. 
Last year's trade deficit of $974m (£593 Dm) will become a 
surplus this year of about $200m, helped by price increases for 
exports and a 10-12 per cent growth in export volumes. Stephen 
Fuller. Latin America Editor ■ 

Brazilian rivals band together 

Mr Fernando Henrique Cardoso, Brazil's president-elect yes- 
terday became actively Involved in campaigning for next 
week’s elections for state governors. But instead of backing 
p oliticians from his own party, he was giving support to a 
candidate from the left-wing Workers party (PT), his main 
opponents in last month's presidential poll Mr Cardoso's 
meeting with Mr Vitor Buaiz, the PTs candidate for governor 
in the southern state of Espirito Santo, was prompted by 
shared concern about the increasing popularity for the other 
candidate, Mr Dejair Camata, a far-right protest candidate who 
has pledged to wipe out crime. Mr Camata is a former police 
corporal who, has pledged to erase crime in Espirito Santo 
and. if elected, would give criminals 24 hours to flee the state. 
According to opinion polls these types of populist promises are 
winning over toe voters. Angus Foster, Sdo Paulo 

Sotheby’s sale raises $26m 

Sotheby's sale of Impressionist and modern art 
in New York on Tuesday night brought in 
$25 Dm and was almost 78 per cent sold by 
value. Ail the important works on offer, 
including one of Modigliani's last portraits, of 
his mistress Jeanne Hebuterne, found buyers. 
- but there was little interest in the second rate. 
Seventeen of the 46 lots were unsold. The Modigliani sold for 
$5.94m, just under its estimate. “Femme dans la mat", painted 
in 1945 by Joan Miro, was also slightly below forecast, selling 
for $3.03m. In 1986 Sotheby’s sold tbe same painting for 52.5m. 
A drawing by Van Gogh, “Wheat Field with Sheaves", copied 
from one of his oils, was just on target at $2.09m. There was 
little interest in Picasso, with only two of six paintings by him 
finding buyers. Antony Thorruroft 

Congress endorses Zedillo 

Mexico's Congress formally appointed Mr Ernesto Zedillo pres- 
ident-elect yesterday, preparing the way for his assumption of 
power on December 1. After long and tense negotiations, the 
centre-right National Action party (PAN) finally abstained and 
the centre-left Democratic Revolutionary party voted against 
ratifying the presidential election. PAN said the election had 
not been fair arai just, and thus could not endorse the result. 
The leftist PRD said the election was invalidated by wide- 
spread fraud. Damian Fraser. Mexico City 




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t 


fXNANCIAL TIMES THURSDAY 


NOVEMBER 10 IS®* 


NEWS: INTERNATIONAL 


Demirel raises stakes in tense regional game 

Project means Turkish hand on Syrian and Iraqi water supply, writes John Barham 


W hen Turkey's Presi- 
dent Sflleyman 
Demirel inaugurated 
a key new stage in the coun- 
try’s gigantic hydroelectric and 
irrigation project yesterday, he 
also raised the stakes in an 
Increasingly tense game of 
regional power politics. 

Turkey is water-rich, but its 
Arab neighbours are desper- 
ately short of it; strategists 
warn that the question of 
water is becoming a more 
explosive Middle East issue 
than that Of oil. 

The South-east Anatolia 
Project, known by its Turkish 
acronym Gap, is a complex of 
22 ifams on the Euphrates and 
Tigris rivers. As well as devel- 
oping a remote and neglected 
corner of Turkey, it also repre- 
sents a Turkish hapri on the 
water supply of Syria and Iraq. 

With yesterday's inaugura- 
tion of the first stage of the 
26.4km Sanllurfa irrigation 
tunnel, 30 cu in a second of 
water will begin flowing from 
the huge AtatQrk Dam through 
a mountain range to the arid 
Harran Plain to irrigate nearly 



Sflrt 


•s a, “■•Vv. Tunnel 

! % Eupfnt as / Harran Plain 

A- 



500,000 hectares of land. 

Gap is a dream come true for 
Mr Demirel, a hydrological 
engineer called the “king of 
dams” and one of the project's 
prime movers in the 1960s. 
Gap’s huge size (the Atatttrk 
Dam is the world's fifth largest 
and the §anliurfe tunnel is the 
longest of its land) is a potent 
affi rmati on of national pride. 

Mr Demirel said at yester- 
day's ceremony attended by 
2JXJ0 people; “We have many 


more projects [for the region]. 
We now know that we are able 
to carry them out alone.” 

Gap is being designed and 
built almost entirely by Turk- 
ish companies. Turkey is also 
financing most of the S32bn 
(£20bn) cost alone, since multi- 
lateral lenders refcsed to sup- 
port the project Still, the Gap 
project is expected to add more 
than $lbn a year to Turkey’s 
$170bn GDP. 

Once it is fully operational 


early in the next century, Gap 
will irrigate land twice the 
area of Belgium. The Harran 
Plain, site of some of the earli- 
est civilisations, has fertile 
soils but lacks abundant water. 

Critics complain the project 
will increase the power of feu- 
dal landlords, and fear the gov- 
ernment is underestimating its 
environmental costs. Further, 
water running off the plain 
into tributaries is likely to 
become polluted wiih pesti- 
cides. fertilisers and salts and 
become unsuitable for use fur- 
ther downstream. 

The plain will produce cash 
crops such as cotton and soya- 
beans. They will be processed 
in nearby cities, creating jobs 
and raising incomes for the 
country's most depressed 
region. Officials hope it will 
bring stability to a region 
wracked by 10 years of fighting 
between government forces 
and guerrillas of the separatist 
Kurdistan Workers’ party 
(PKK). 

But for Syria and Iraq, which 
depend heavily on the Euphra- 
tes. Gap is a nightmare. Each 


cubic metre of water poured on 
to the Harran Plain represents 
a roughly equal reduction in 
the Euphrates' flow. 

Before the first Hams were 
completed in the late 1980s. the 
Euphrates carried 856m cu m 
of water across the Syrian bor- 
der every second. In 1987 Tur- 
key promised Syria a stable 
Dow of 500 cu m a second. If 
worst-case scenarios are borne 
out. pre-Gap flows further 
downstream into Iraq could be 
cut by more than 80 per cent in 
the next 40 years. 

Turkey gave Syria and Iraq 
no role in Gap’s development 
and has never reached an 
agreement with them over 
sharing the waters of the 
Euphrates and Tigris. Interna- 
tional lenders such as the 
World Bank refuse to back 
Gap. Thus. Turkey has had to 
postpone or scale back pro- 
jects. Building Gap is straining 
government finances and fuel- 
ling inflation of more than 100 
per cent 

Syria is not satisfied with 
Turkey's unila teral 1987 com- 
mitment to supply 500 cu m of 


water a second. It has chosen 
to press Ankara for a water 
deal by supporting the PKK. 
Turkish security forces are 
spending more t han £7bn a 
year to fight the PKK in the 
Kurdish south-east 

Mr Dogul ErgU, a politic al 
scientist at Ankara University 
and adviser to the Gap admin- 
istration. says; “Turkey pro- 
posed a philosophy of mutual 
use, to consume water where 
there is less evaporation and 
cultivate land where the soils 
are most fertile, and share the 
fruits". 

But “our neighbours are dic- 
tatorships apri it is not in the 
nature of dictatorships to 
co-operate." 

Optimists hope water may 
yet bring peace rather than 
conflict Already Gap is shift- 
ing the region's strategic bal- 
ance towards Turkey. But like 
many Turkish officials. Mr 
Ergil strenuously denies Gap is 
any thing more th an a develop- 
ment project: “Turkey has 
never thought of using it as an 
instrument to manipulate our 
southern neighbours." 


African peacekeeping force ‘has moved nearer’ 


By David Buchan tn Biarritz 

President Francois Mitterrand 
claimed yesterday the idea oT 
an inter-African peacekeeping 
force to intervene in future 
Rwanda-style crises had 
“advanced" at the Franco- Afri- 
can summit in Biarritz, adding 
France would ask other Euro- 
pean countries to join it to pro- 
viding help. 

But not all the 35 African 


leaders present favoured or 
promised to take part to such a 
force, and most backers of the 
idea said it depended crucially 
on oon- African assistance. 

“This pan-African structure 
of Trine helmets* will only be 
really operational If France 
and other friendly countries 
give us their logistic support,” 
President Gnasstogbe Eyadema 
of Togo said. 

The French president stoutly 


defended his often-controver- 
sial Africa policy at a summit 
dominated by discussion of the 
Rwandan bloodshed and its 
consequences, bat to which 
Paris had not invited Rwanda’s 
new leaders. 

President Mobutu Sese Seko 
of Zaire was one of those who 
criticised France for excluding 
Rwanda, though the Zairean 
leader’s own presence in 
France, which has denied him 


a visa for the past few years 
because of his human rights 
record at home, stirred a sepa- 
rate controversy. 

President Mitterrand 
vaunted France’s record of eco- 
nomic help to Africa before 
and after last January's deval- 
uation of the French African 
franc (CFA), and of security 
assistance, especially French 
troops' intervention in this 
summer’s Rwandan civil war. 


Mr Mitterrand and Prime 
Minister Edouard Bailadur 
want to avoid repeating 
France's painful exposure in 
its Operation Turquoise in 
Rwanda, at the start of which 
more than 2.000 French troops 
were joined only by 230 Sen- 
egalese. President Sylvestre 
Ntibantuganya of Burundi, 
which faces the same ethnic 
tensions as Rwanda, made 
clear he would prefer diplo- 


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matic help rather military 
Intervention. 

The French president said 
the summit participants had 
agreed on “certain general 
principles" that an African 
intervention force would be 
under “collective command, 
acting under the aegis of the 
UN or the Organisation of Afri- 
can Unity". But some leaders 
appeared divided on the issue 
of who should take part 

President Omar Bongo of 
Gabon said Rwanda had given 
urgency to discussion of an 
African force, but talks should 
first take place among French- 
speaking countries. President 
Blaise Compaore of Burkina 
Faso said that discussing secu- 
rity in west Africa made no 
sense without English-speak- 
ing Nigeria or Ghana. 

French leaders are keen far 
the widest possible participa- 
tion in an intervention force to 
avoid accusations of neocolo- 
nialism. But Vice-President 
Thabo Mbeki of South Africa, 
which along with Zimbabwe, 
Ethiopia and Eritrea was repre- 
sented at the biennial summit 
for the first time, indicated his 
new government would not 
take part in any force, even 
though its army is the conti- 
nent's most powerful 

Mr Mitterrand, who said he 
hoped several European coun- 
tries would join France in pro- 
viding logistic support to an 
African force, is to meet Mr 
John Major. UK prime minis- 
ter, in next week's Franco-Brit- 
ish summit in Chartres. 

President Bongo said yester- 
day he had been one of the 
strongest opponents of the 
CFA devaluation, hut now con- 
ceded it was necessary and was 
benefiting most of the 14 econ- 
omies concerned. He urged 
Africa's creditors to forgive 
more of the continent’s debts. 


OECD growth 
rate edges up 

ss ast&igjgiSSSS 

year is expected tobesu^^^ forecast in July, according 
increase m gross domesti product. Tanaka,vice- 

to offldal. .at the 

chairman of hadbeen generally favourable. 

edge up to 2.7 per as* ForW® and 1996, Mr 
Tanaka said growth would be shout ^percent 

^ ZLttZmtai Europe. “The recovery has pi 


ta CC !S^S^Si’’^d Mr Tanaka. The Japanese earn- 

employment John Ridding, Paris 

Japanese bonuses increased 

Japan’s leading electronics compmnes ye^mda|Vra^^y 
would increase workers’ bonuses for the ftm 

years a good sign for consumer spending. Other sectors are 
Ely tofonoSTsuit this year because theyhave^to 
well than electronics groups- Yet the bonusnse indicates that 
tins traditional Hnk between workers tocomesand Mffporate 
profits has survived the rigours of recession- Thai bodes wen 
fix consumption once the nascent profits recovery has had 

time to spread, economists say. 

Trade unions at the top 17 electronics groups smdyesterday 
they had accepted six-monthly bonuses averaging 5J K mon ths’ 
base salary for this whiter and next summer, up from last 
year’s five months’ bonus. WUUutn Datokins, Tokyo 

Ir anian jets raid Kurds in Iraq 

Iran said its fighter aircraft had raided guerrilla bases in Iraq 
yesterday . An Iranian Kurdish rebel party said one of its 
camps inside a western no-fly zone to Iraqi Kurdistan was 
pounded by Iranian jets. Four Iranian fighters “severely bom- 
barded" a base of the Democratic Party of Iranian Kurdistan 
inKoi Sanjaq, 60km from the border, killing a woman resufent 
of the town and wounding three people, the party said m a 
sd-n+pmpnt On Sunday Iran fired at leak three Scud missiles at 
the main base of the Mtqahideen Khalq opposition group 80km 
inside Iraq. Reuter, Nicosia 

Mitsubishi extortion arrests 

Police arrested eight people yesterday for allegedly trying to 
extort money from Mitsubishi Heavy Industries with threats 
to expose company secrets. Police did not say how much the 
eight allegedly demanded from the big Japanese heavy 
machinery maker, which refused to pay. The eight first 
approached the company to November 1991, threatening to 
make public what they said were company documents cm 
bid-rigging, police added. AP, Tokyo 

Hong Kong to boost car taxes 

Hong Kong aims to tax vehicle owners to avert total gridlock, 
government officials said yesterday. Proposals released by the 
government for public comment include increasing the tax on 
new cars to 70 per emit of the car’s total value from 4060 per 
cent now, and raising annual licence fees by 40 per-cent: 
Access to tunnels could be restricted to odd or even numbered 
plates on alternate days. Quotas for new private cars and 
removal of tax benefits on company cars are also being consid- 
ered. The government proposes eventually to introduce elec- 
tronic road pricing in which car-owners pay according to how 
far their cars travel. Reuter, Bang Kong 

■ South Africa’s all-commodities producer price index rose 0.3 
per cent in September from August after rising L4 per cent in 
August, Central Statistical Service figures show. The year-on- 
year rise in September was 10.1 per cent after a 9.9 per cent 
rise in August Reuter, Johannesburg 

■ The Philippine central bank cut its preferential lending rate 
given to exporters and small-scale industries to 8.304 per cent 
from 9.4 per cent under its rediscount window facility. Reuter, 

■ Taiwan’s defence ministry proposed a record military bud- 
get for the 1995-96 fiscal year of T$277.9bn (US$10.7bn) up from 
a revised T$252Jbn this fiscal year. Reuter, Taipei 

■ International aid donors yesterday pledged to give Mongolia 
$21 Qm in 1995 to help it make the transition to a market 
economy. Japan's foreign ministry said. Reuter, Tokyo 


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As he closed tfie door behind him and stepped into the street the 
bomb exploded. We collected him after his discharge from hospital A 
bomb can do a lot of damage in a narrow Belfast street where danger 
has become a way of life for over 25 years. 

We now look after him in our residential home. He will never leave 
it because ot his fear of the outside. His brain connects the outside 
with pain, terror and danger. He can now only look at the outside 
world from the safely of four walls. 

The Ex-Services Mental Welfare Society has nearly 4.QQ0 ex- 
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— waiting fist Please do help. We have need of every 

v penny urgently 

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7 


FINANCIAL TIMES 


THURSDAY NOVEMBER 10 l >9* 


NEWS: INTERNATIONAL 


EU signs $124m aid and loans package with Palestinians 


By JuBan Ozanm in Jetusalem 

Tfae&inipetti Union yesterday 
signed an agreement with Palestin- 
*£2“** l0Ans worth up to 
£**“2™“) m 1995 and strongly 
record on assistant to 

Mr Juan Prat. European Commis- 
son director general, who signed 
tne agreement in Gaza with Mr Yas- 
slr Arafat, chairman of the Palestin- 


ian self-rule authority, also warned 
the EU would not fund Palestinian 
running costs after June next 
year. 

Mr Prat said the EU was doing 
as much as it could to help 
Palestinians and rejected . crit- 
icisms that the EU was slow in 
disbursing funds. He said the 
EU had spent $61m this year 
and made grants worth Sl.lfm since 
1987 in development assistance and 


support to Palestinian refugees. 

"There is no way anybody can 
say we are promising and not 
doin»; he said. “The community is 
doing even’ thing it promised. The 
delays could be six weeks or one 
month - little things of cash 
flow. . . but what we have offered is 
happening. H 

The EU is the biggest single 
donor to Palestinians and the 1995 
aid package is part of the EU’s 


$620m five year programme of 
grants and loans from the European 
Investment Bank. Among projects 
supported by the EU are paying sal- 
aries of the 10.800 Palestinian 
policemen: a $50m project to build 
1,200 bousing units: construction of 
a 230 bed hospital: upgrading of the 
sewage and solid waste systems and 
funding Palestinian universities 
and colleges. 

Mr Prat said donors faced a 


dilemma. While they wanted to 
fund visible projects that immedi- 
ately demonstrated to Palestinians 
that peace brought concrete 
changes in living standards they 
were being forced to fund salaries 
and running costs. At least half of 
EU grants worth S62m in 1995 will 
go to pay salaries of policemen and 
university teachers. 

“What can we do. They have a 
budget and they have a deficit and 


if they cannot fund their budget 
everything is going to collapse,’* he 
said. “I understand people in Gaza 
are impatient but things cant hap- 
pen overnight." 

Donors are increasingly frus- 
trated about having to fund Pales- 
tinian running costs rather than 
actual projects. Until Israel bands 
over the West Bank, which has a 
much larger revenue base that Pal- 
estinian controlled Gaza-Jericbo. 


donors are being asked to finance a 
growing budget deficit. 

The handover of the West Bank is 
at least nine months behind sched- 
ule. 

"We want a balance between tax 
and revenues by June 1995 and we 
hope their talks will progress so 
that everything which has to be 
transferred to the Palestinians is 
transferred according to their agree- 
ments." 


Summit light spills over on to East Timor 

Indonesia is braced for world attention on its annexed territory, writes Manuela Saragosa 


O n All Souls Day at the 
Santa Cruz cemet e ry in 
the East Timor capital 
of DOi last week, people paid 
tribute, in the Ro man Catholic 
tradition, to their deceased 
family and friends. Near the 
chapel a large group gathered 
and, led by a local priest, 
remembered up to 200 indepen- 
dence demonstrators who were 
massacred than by Indonesian 
soldiers three years ago. 

Further recollections of the 
massacre, official admission of 
which was slow to emerge at 
the time, are the sort of thing 
the Indonesian government 
hopes mil not take the gloss 
off its hosting of the Asia 
Pacific Economic Co-operation 
summit next week. 

President Suharto’s govern- 
ment, notoriously sensitive 
about its annexation of the for- 
mer Portuguese colony it 
invaded in 1975, is hoping to 
win new internatio nal respect 
from the summit, due to be 
attended by representatives of 
17 governments. 

However, US President Bill 
Clinton and others will be 
under pressure to raise human 
rights issues at the summit, 
and at least some attention Is 
bound to be focused on East 
Timor. 

East Timor was abandoned 
by -its c olonial administ rators 
in 1975 when the region was 
plunged into civil war. Indon- 
esia invaded because, the gov- 
ernment claims, the civil war 
in the territory, which borders 
Indonesian . West Timor, 
"threatened seriously to dis- 
rupt the national development 
and reconstruction efforts in 
which Indonesia was engaged". 
East Timor was declared 


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INDIAN OCEAN 


Timor 


Indonesia’s 27th province in 
1976, defying resolutions 
passed by the United Nations 
which does not recognise Jak- 
arta’s sovereignty over the ter- 
ritory. 

Sensitive to foreign criticism. 
Indonesian officials are keen to 
point out that the region 
receives more government 
development funds, per bead, 
than any other. Under Portu- 
guese rule the region’s infra- 


structure and facilities were 
negligible. Today there are 
schools, a university, roads, 
bridges, health clinics, telecom- 
munications facilities and elec- 
tricity. Water supply is still a 
problem. 

However, says an East Timo- 
rese professional, “we never 
cried for development. We 
cried for freedom." 

Freedom is not on offer - a 
referendum is ruled out - but 


the Indonesian government 
has taken some steps to Fmd a 
solution. Mr Ali Alatas, foreign 
minister, met earlier this year 
in New York, under United 
Nations auspices, with the 
leader -in-exile of the Fretilin 
independence group, Mr Ramos 
Horta. and with Mr Abilio 
Araujo, another former leader 
in-exile who was ousted from 
the exiled movement by oppo- 
nents last year. 

More recently President 
Suharto announced he would 
meet Mr Araujo although they 
would not discuss the status of 
the territory. 

There has also been talk of 
granting autonomy or special 
status to East Timor but it is 
not dear what this means and 
statements have been non-com- 
mittal. East Timorese are 
quick to point out that the 
north Sumatran province of 


Aceh and the sultanate of 
Yogjakarta in central Java are 
also accorded special status, 
but that this has not made any 
difference to the way the 
regions are governed. 

Meanwhile, the military 
makes clear it has no plans to 
leave. “If we leave there will be 
more conflict.” says East 
Timor’s military commander. 
Col Kiki Syahnakri. However, 
he claims the number of armed 
guerrillas is dwindling - there 
are only 288 poorly-equipped 
Fretilin fighters left in the 
mountains, he says. 

One East Timorese official 
says rape and murder by the 
military and police are daily 
occurrences in many parts of 
the region. Many of these 
cases, be says, go unreported 
and the perpetrators are not 
brought to trial. “We are really 
suffering here.” he says. 


PRIVATISATION COMPANIES LINED UP 


Indonesia plans a privatisation drive as 
part of its 1995-96 budget, with 
inter national equity offerings and 
flotations on the Jakarta stock exchange. 
Manuela Saragosa reports. 

Mr Mariie Mohammad, finance 
minister, said yesterday that Telkom, the 
domestic telecommunications company, 
PLN, rite electricity company, and Jasa 
Marga, the toll road operator, were the 
three state-owned companies most 
prepa r e d to “go international". He also 
admitted that Gamda, the state-owned 
airline which some brokers said was 
being groomed to go public, was not yet 
ready to be sold on the international 
market 

The government also plans to reduce its 
stake In Semen Gresik, one of the 
country's largest cement producers, which 


is already listed in Jakarta, and sell 
shares in two other state-owned cement 
producers, the South Sulawesi-based 
Semen Tonasa and the West 
Sumatra-based Semen Pa dang. 

Mr Andrew Vaughan, director of 
research and sales at stockbroker G K 
Goh Ometraco, said the privatisations 
"have been on the launch-pad for a long 
time". Telkom is thought likely to sell at 
least SSOOm (£3 12m) worth of shares in its 
initial public offering. It is estimated that 
each of the companies will have to float at 
least $20m-worth of shares to make the 
exercise worthwhile. But it is not clear 
yet whether Jasa Marga will issue bonds 
overseas rather than selling shares. 

The companies are expected to give 
domestic exchanges a boost by floating- 
some of their equity on the Indonesia - ■* 


market “Long-term, this is exactly what 
the Jakarta market needs, to have more 
large blue-chip companies," said Mr David 
Oxtoby. research director at Asia Equity 
Jaserefa. “The size of their cash call may 
have a short-term depressing effect but it 
will simply be a case of short-term pain 
for long-term gain." 

Mr Muhammad’s planned privatisations 
follow the flotation of shares in Indosat, 
Indonesia's telecom satellite enterprise, 
on the New York Stock Exchange last 
month which raised at least $800m for the 
Indonesian government 

Indosat sold 25 per cent of its shares in 
New York and 10 per cent on the Jakarta 
and Surabaya stock exchanges. Merrill 
Lynch was the global underwriter for the 
offering; while Dananeksa Seknritas 
underwrote the domestic share sale. 


Clashes between mainly Mos- 
lem Indonesians, who are 
given incentives to more to 
East Timor, and Roman Catho- 
lic East Timorese are common. 
Recently two army officers 
were found guilty by a military 
court of desecrating the sacra- 
ment in a Catholic church and 
discharged. 

The animosity is made worse 
by rising unemployment The 
East Timor Provincial Capital 
Investment Co-ordinating 
Board says there were 16JJ08 
unemployed people in the prov- 
ince in August 1993, but inde- 
pendent-sources say the figure 
is much higher. There are com- 
plaints that all the best jobs go 
to outsiders. East Timorese say 
that they have little control 
over their region’s economy. 
The plantation and processing 
of coffee, the main cadi crop, is 
dominated by the military 
although a monopoly on pro- 
duction was lifted earlier this 
year. 

Indonesian rule has 
increased the level of distrust 
among the population. Plain- 
clothed intelligence officers are 
ubiquitous. "I don't even know 
whether my brother or sister is 
spying on me.” says an East 
Timorese professional who 
complains that Indonesian 
rule has sowed an atmosphere 
of fear among the population. 

In the ah— ice of a referen- 
dum, and with a continuing 
large military presence in East 
Timor. Indonesia’s rule in the 
region will continue to attract 
criticism from the interna- 
tional community. The Apec 
summit next week is likely to 
be seen by some as an occasion 
for that criticism to be loudly 
voiced. 


Hanoi set for 
$2bn pledges 
in foreign aid 


By Victor Mallet hi Hanoi 

Vietnam is likely to receive 
pledges of some $2bn (£12bn) 
in foreign aid at a donors’ 
meeting in Paris next week 
and wants about §lObn by the 
end of the decade to fund its 
economic reform programme, 
Vietnamese government offi- 
cials and foreign donors say. 

Both sides are confident the 
"consultative group" of 18 
countries and 15 international 
organisations, chaired by the 
World Bank on Tuesday and 
Wednesday, will at least match 
the $lB6bn pledged at the first 
such meeting last year. Japan 
is a gain expected to be the big- 
gest bilateral donor. 

Donors are pleased by Viet- 
nam's performance as it moves 
from a centrally planned to a 
market economy with annual 
growth rates in excess of 8 per 
cent, but they are also con- 
cerned by delays in implemen- 
tation of aid projects. The UN 
says that only an estimated 
$300m in aid has been dis- 
bursed this year. 

“The most important issue 
will be how to use ODA [offi- 
cial development assistanc e) in 
Vietnam, not how to attract 
ODA.” said Mr Do Due Dinh, a 
Vietnamese economist 

One reason for slow dis- 
bursement is that much of the 
aid is directed at big infra- 
structure projects involving 
roads and ports, for example, 
which take many months to 
implement. Some delays are 


caused by a cumbersome 
bureaucracy slow to adopt free 
market policies. 

“With the actual disburse- 
ments of ODA. things are not 
flowing as freely as we would 
have hoped,” said Mr Roy 
Morey, representative in Viet- 
nam for the UN Development 
Programme. “The institutional 
apparatus is the same as the 
country has bad for 25 years, 
and there’s a kind of lag 
between policy formulation 
and policy implementation.” 

In its latest report on Viet- 
nam, the World Bank urges 
Hanoi to scrap central control 
of decision making (on the 
grounds that this causes bottle- 
necks and encourages corrup- 
tion in an increasingly com- 
plex economy). by 
decentralising some tax and 
investment decisions to local 
authorities. 

The World Bank admits this 
suggestion is controversial 
(local Communist party 
authorities in some areas are 
accused of rampant corruption) 
but believes it would allow the 
government to take on its 
proper role of establishing an 
economic framework within 
which individuals and compa- 
nies could work. 

"Vietnam is moving from rel- 
atively easy price liberalisation 
to more difficult structural 
reforms, such as restructuring 
state-owned banks, privatising 
public companies, and stream- 
lining the trade regime,” the 
World Bank report says. 


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8 


F^ANCIAL TIMES 


THURSDAY NOVEMBER 


10 1994 


NEWS: WORLD TRADE 


Apec: future global powerhouse or mere talking 

W hen the Asia-Pacific casting shadows over Apec's The former, long lukewarm decision which committed the .. ■ 1 

Economic Compere- future. about Apec, has threatened to US to lowering its trade barn- ana world Trade • 

tion forum held its The starting point for the block progress unless Washing- ere substantially. . ■ > » 


Gatt chief 
readv for ♦ 


W hen the Asia-Pacific 
Economic Co-opera- 
tion forum held its 
first annual summit in Seattle 
a year ago, a curious European 
Commission asked to send 
observers. The request was 
rejected. “The reason was sim- 
ple,” says one Asian diplomat 
“We didn’t want them to dis- 
cover there was nothing to dis- 
cover." 

As ministers of Apec's 1? 
gove rnments meet in Jakarta 
today to prepare for next Tues- 
day's summit, the stakes look 
much higher. The summit 
poses a stiff test of their politi- 
cal will to give substance to a 
grouping which has so Ear been 
long on visionary statements 
but short on concrete deci- 


casting shadows over Apec's 

future. 

The starting point for the 
talks is an ambitious blueprint 
drafted by an eminent persons' 
group, chaired by Dr Fred 
Bergs ten, head of the Washing- 
ton-based Institute tor Interna- 
tional Economics. 

It proposes that all trade bar- 
riers in Apec be abolished by 
2020, and by 2010 in the case of 
industrialised countries. Other 
blocs, such as the European 
Union, would be invited to 
make reciprocal concessions in 
a move to force the pace of 
multilateral trade liberalisa- 
tUKL 


The former, long lukewarm 
about Apec, has threatened to 
block progress unless Washing- 
ton softens its line on Beijing a 
application to join the new 
World Trade Organisation in 
January. Ms Wu Yi, China's 
trade minister. Is expected to 
step up the pressure when she 
meets Mr Mickey Kantor. Pres- 
ident Clinton's chief trade 
negotiator, in Jakarta on Sat- 
urday. 

However. Beijing may be 
over-estimating Apec's impor- 
tance as a bargaining chip 
with Washington. Much has 
changed since President Bill 
Clinton talked up Apec's future 


Optimists hope the five-year- 
old Apec wifi set out to become 
a global economic powerhouse 
by agreeing a tong-term time- 
table for freeing all trade <»»i 
investment flows in a region 
which extends from Labrador 
to Singapore. 

Apec's members include 
some of the world's fastest- 
growing economies and 
account for roughly half its 
total gross domestic product 
and international trade. But 
there are wide disparities 
between individual countries’ 
levels of economic develop- 
ment and their views on 
Apec's role. Bilateral relations 
between some of them are 
acutely strained - most nota- 
bly by US trade conflicts with 
China and Japan and by Wash- 
ington's criticisms of Indones- 
ia's human rights record. 

If these tensions bubble up 
into acrimonious disputes in 
Jakarta, they risk scuppering 
the search for harmony and 


Guy de Jonquieres and Peter 
Montagnon on the choice facing 
Asia Pacific nations 


The plan's most enthusiastic 
supporters are Australia, 
which is eager to stress its 
Asian credentials, and Indon- 
esia. President Suharto views 
the s ummi t as a chance to set 
his seal on history and wants 
an even earlier deadline for 
Apec free trade. 

At the other extreme, Malay- 
sia remains sceptical of the 
value of Apec and continues to 
press for a rival East Asian 
Economic Caucus to counter 
western economic domination. 
Still. Dr Mahathir Mohamad, 
Malaysia's prime minister, who 
boycotted the Seattle meeting, 
plans to attend this summit, 
and President Suharto may yet 
persuade him to tone down his 
opposition. 

Much the biggest uncertain- 
ties concern China and the US. 


at last year’s summit, in the 
belief that a united stand by 
Pacific Rim countries would 
induce the EU to give ground 
in the stalled Uruguay Round 
trade talks. 

Today, with prospects for 
congressional ratification of 
the Round on a knife edge, the 
administration's priorities are 
reversed. It seems decidedly 
wary of any trade initiatives 
which could fuel domestic 
opposition to the Round. 

President Clinton’s position 
has been further undermined 
by the Democrats' Loss of con- 
trol of both houses of Congress 
in Tuesday’s mid-term elec- 
tions. 

He may therefore be bard- 
pressed to offer any immediate 
concessions on China’s WTO 
entry, or to back any Apec 


decision which committed the 
US to towering its trade barri- 
ers substantially. 

“Mr Clinton wants a big pub- 
lic relations success In Jakarta 
which ties his hands as little as 
possible,” says a US trade pol- 
icy expert 

Though Apec leaders may 
agree a long-term commitment 
to liberalisation, he thinks 
they may endorse only uncon- 
troversial proposals in areas 
such as customs procedures, 
standards and voluntary 
investment principles. 

Mr Rim Chul-su, South 
Korea's trade minister, also 
doubts the summit wfll set a 
binding timetable for liberalis- 
ation and says such an agree- 
ment may take at least a fur- 
ther year to achieve. 

Such an anodyne outcome 
need not constitute complete 
failure in the eyes of Apec’s 
Asian members. Many see the 
grouping less as a forum for 
sweeping policy decisions than 
as a channel for informal dia- 
logue, particularly with the 
US, their largest final market. 

Most would resist any 
attempt to turn Apec into a 
formal institution. They fear 
such a step could threaten the 
future primacy of the WTO and 
encourage the US to use Apec 
as a dub to force them into 
making trade concessions. 

Many Asian countries also 
want to push ahead with 
efforts to free trade within 
Asia before embarking on any 
programme involving Wash- 
ington. 

Some observers believe little 
progress in Apec is likely until 
the recent decision by the six- 
member Association of South 
East Asian Nations to try to 
revive plans for an Asian free 



i A 


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south Korea 


caretaker 
WTO role 


By Frances WBhmsifci'OsrifW 




\ 


SB Apse 

members 
■ Apec 

and Ascsn 
members 


7 TiaSand 
U Singapore 
IWqA 
Brunei 
Australia 



-Hongkong' . 
Taiwav: 

phMpphrea ■- 


mwzm *•#;. 


East Aslan trade by partner 
Percenta g e of total exports 
too - 


trrtraregio na l trade 

Percentage of total worid trade 


Beat at the world 


ted* as" a*;;.*. 


East Asia 


'.V-- .. .T.,.'- \ 

10,0 2L2 2.9 ■ 42 


1940 90 60 

* Newly ImtustriafeKd Ecc 'varies 


North America North America &0- €.7 • ' ' 

-TTrrg gHi Pacific region l&O 13S 108 152.. 248 

... - . -j: 

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trade area has borne fruit. 

Though the plans remain 
tentative and face big hurdles, 
Mr Chuan Leekpai, Thailand's 
prime minister, says Apec is “a 
looser form of grouping with 
less depth” than Asean. In his 
view, Apec's main contribution 
to trade liberalisation will be 
to encourage efforts under way 
in other forums, rather than to 
launch substantive pro- 
grammes of its own. 

Ambivalence also runs deep 


in Japan. Though the govern- 
ment appears ready to hade a 
summit declaration endorsing 
broad ' free-trade principles, 
Tokyo wants to avoid any deci- 
sions which could force it to 
choose between its allegiances 
to Asia and to the US. 

Some Apec members have 
questioned the value of any 
declaration which does not 
bind governments to at least 
some concrete action. But even 
if the summit endorsed a 


long-term liberalisation pro- 
gramme, implementation 
would still require complex 
negotiations. 

These would have to over- 
come fundamental conceptual 
differences between Apec's 
members, which even the care- 
fully-drafted Bergsten report 
foils to hide. 

“The report is riddled with 
contradictions,'’ says Dr Young 
Soogfi, a leading South Korean 
trade economist 


Poland bids for improved UK trade and investment 


By Anthony Robinson 


Mr Waldemar Pawlak. the 
Polish prime minister, yester- 
day sought to attract more UK 
trade and investment by stress- 
ing Poland's large market - 
equivalent to the combined 
populations of the Czech 
Republic, Hungary, Slovakia 
and former East Germany - 
and access to non-Russian 
sources of oiL 

Addressing a Polish business 
conference at the Confedera- 


tion of British Industry in Lon- 
don, Mr Pawlak said that 
Poland was currently enjoying 
rapid export-led economic 
growth and broad political 
agreement on the development 
of market-based reforms. 

Polish-UK trade has more 
than tripled in the past four 
years. This Is partly a result of 
growing UK investment by 
companies such as Pilking tnn 
Glass, British Vita, British 
Sugar, British American 
Tobacco, Cadbury Schweppes, 


BP and British Oxygen, and 
also because of rising exports 
of North Sea oil to Polish refi- 
neries through the port of 
Gdansk. 

In the first seven months of 
this year Polish exports to the 
UK rose to £305m ($500.2m) 
from £25Lm in the same period 
of 1893, while UK exports to 
Poland slipped bade to £366m 
from £415m, mainly because of 
a fall in oil and refined product 
imports to £88m from £l51m. 

Poland's diversification from 


dependence on Russian oil was 
an early priority of post-com- 
munist governments. By 1992 
oil imports from Russia had 
dropped to 48 per cent of the 
total, while the UK supplied Zl 
per cent, Iran 18 per cent and 
Norway 8 per cent 
Last week Russia and Poland 
were due to finalise an agree- 
ment on the construction of 
the Polish section of a gas pipe- 
line which will eventually 
bring 07bn cumol natural gas 
annually to central and west- 


ern Europe from the Yamal 
peninsular. Mainly for domes- 
tic political reasons. Mr Victor 
Chernomyrdin, the Russian 
prime minis ter, called off the 
meeting, but the substance of 
the deal has not been affected. 

Poland will help build and 
finance the pipeline and take 
14bn cu m of Russian gas 
annually. Unlike earlier Soviet 
gas pipelines, which termi- 
nated in former east Germany 
and so represented Soviet con- 
trol over Poland, the Yamal 


pipeline will transit Poland 
and the main throughput will 
be sold on the German market 
Modernisation of Poland's 
oil- refinin g and petrochemical 
industry', requiring a total 
investment of about $SL5bn, is 
one of the government's 
long-term priorities. But poten- 
tial foreign investors, includ- 
ing UK oil and energy groups, 
have been frustrated by politi- 
cal uncertainty over what 
strategy will follow. Mr Pawlak 
said yesterday that the govern- 


ment was currently inclined to 
restructure title industry before 
privatisation. Officials added 
that Warsaw would be seeking 
substantial foreign, investment 
Developing the energy sector 
was part of a broader plan to 
restructure eight Industrial 
sectors, including coal, iron 
and steel and shipbuilding, 
which had already ha d subsi- 
dies removed and were now 
operating profitably, said Mr 
Matek POL trade and Industry 
minister. 


p 

O 

N ' 

T 

c 

R 

A C 

K 

u 

N 

D E 

R 

[PRESSURE 



TO SAVE THE 
RAINFOREST WE 
PROVIDE TREES 
TO CHOP DOWN. 


By helping people 

in tfac mnforor w pbnc trees, WWF 
are wtxfciDg in mh* some of 
ihr problems do* cause defonsuvon. 

Where trees arc chopped 
dawn for firewood, we bdp plant lad 
growing saplings as a renewable 
source of fad. This is pwocalirty 
valnable in die Imp en e tra ble Forest, 
Uganda, where indigenous 
haidwooJi take op to two hundred 


Toyota planning second 
assembly plant in Canada 


By Kevin Done, 

Motor Industry Correspondent 


yean to mature. 


The UMmia Imm trees wWF gave 
to ihe local Tillages are 
ready for harresung in only five yean. 
Where trees are chopped 
down for ore in comomaun, as in 
Ihkiran, we supply 
for growing local pine species. 


Toyota is to double production 
capacity in Canada to 205,000 
cars a year by the late 1990s. 
The Japanese carmaker is 
planning to invest C$600m 
($450m) to build a second 
assembly plant at Cambridge, 
Ontario, with capacity to pro- 
duce 120,000 cars a year. Out- 
put at its current plant Is 

85.000 cars a year. 

The new plant, due to begin 
production in August 1997, will 
increase Toyota's capacity in 
North America to more than 

900.000 cars and light trucks a 
year by 1998. and will help 
Toyota counter the impact of 
the yen's appreciation. 

The main model to be pro- 
duced at the new plant will be 
the Toyota Corolla small fam- 


ily saloon It is already assem- 
bled at Toyota's plant in 
Ontario and at the New United 
Motor Manufacturing (NUMMI) 
plant at Fremont, California, 
Toyota’s joint venture with 
General Motors. A rebadged 
version of the Corolla produced 
at the NUMMI plant is sold by 
GM in North America. 

Toyota said it would cease 
exporting the Corolla from 
Japan to North America, when 
the new plant in Canada 
begins production 

Toyota, the leading Japanese 
vehicle maker, announced 
recently that Its production in 
North America was expected to 
rise to 790,000 vehicles in 1996, 
a 50 per cent increase from last 
year’s output of 533,000. 

North American produced 
vehicles are expected to 
account for 60 per cent of Toyo- 


ta's sales in tile US and Canada 
in 1996 compared with 46 per 
cent last year. 

Toyota is also increasing its 
car exports from North Amer- 
ica, chiefly to Japan, Taiwan 
and west Europe, and exports 
from the US and Canada are 
forecast to rise to 80,000 a year 
by 1996 from 50,000 last year. 

It is seeking to increase the 
local content of its North 
American produced vehicles 
with plans to raise engine pro- 
duction in the US and Canada 
to more than 440,000 a year in 
1996 from 207,000 in 1993. 

Toyota that the plannwl 
expansion in Canada would 
satisfy the local content 
requirements of the North 
American Free Trade Agree- 
ment allowing the cars to be 
shipped freely between Can- 
ada, the US and Mexico. 




tiit 


a- • ‘ 




\ t &:' ‘ i.:' 

*. - 


■With the contest for the top job 
at the future World Trade 
Organisation effectively dean; 
locked, Mr Peter Sutherland, 
directoripaneral of the General 
Agreement on Tariffs ana 
Trade, is' believed. to be ready 
to stay on in a caretaker role 
until his term ends next July. 

Mr Sutherland announced 
last April he would not be a 
candidate for director-general 
of the WTO, which Is supposed 
to begin work on January L 

But it now looks increasingly 
unlikely that a decision on his 
successor will : be made ■ by 
early December, when -Gatt 
nmmhprs are due to endorse 
the appointment, mak i n g it vir- 
tually impossible for the new 
director-general to take up the 
WTO reins in January. 

Though no formal proposal 
to stay on has yet been, made 
to Mr Sutherland, it Is under 
active discussion by trade dip- 
lomats anxious to assure a 
smooth transition from Gatt to 
the more powerful WTO. How- 
ever, some officials are still 
hopeful that the decision on 
the choice of WTO chief can 
stiff be made by next month. 

A third round of consulta- 
tions awinng Gatt members on 
the WTO appointment is tak- 
ing place in Geneva this week. 
Trade officials said yesterday 
they expected the outcome to 
be a continued three-way split 
on regional lines between Mr 
Renato Ruggiero, the EU candi- 
date, Mr Carlos Salinas de Gor- 
tari, the outgoing Mexican 
president who has US and 
Latin American backing, and 
Mr Kim' Chul-su . of South 
Korea who has Asian support. 

Though Mr Ruggiero Is 
ahead numerically, the even- 
tual decision must be made by 
consensus. Delays tn ratifying 
the WTO and the associated 
Uruguay Round global trade 
accords, the continued stale- 
mate over the next OECD sec- 
retary-general and the lack of 
eng a gement of the US in the 
WTO race are ail seen as obsta- 
cles to consensus. 

To these must now be added 
the uncertainty over the out- 
come -of- the Uruguay Round 
vote tiy the US Congress in 
three weeks’ time. A rejection 
by Congress would certainly 
kill the WTO which could not 
operate effectively without the 
participation of the world’s big- 
gest trader. 

Only 30-odd countries among 
Galt’s 124 members have so Ear 
ratified the world trade pact, 
and they do not include any of 
the Quad group of leading trad- 
ers - the US, the EU. Japan 
and Canada. Most have been 
awaiting the US decision. 

The mid-term elections and 
the Impending Uruguay Round 
vote have also kept the US out 
of the active big-power horse- 
trading that win be a neces- 
sary ingredient of an eventual 
deal. 

Though strongly denied by 
the US and EU, many trade 
diplomats believe there is also 
a trade-off between the WTO 
leadership and the long 
delayed decision on who 
should run the OECD in Paris. 
I£ as .the US and Canada are 
demanding, the OECD job goes 
to a non-European, this' could 
boost Mr Ruggiero's WTO 
chances. 

Congress and Gatt, Page 6 


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By Guy de Jonquldres, 
Business Ecfitor 


TAGHeuer 

r5VV:$S MADE SINCE 1£o0 



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The main arguments used by 
Europe’s motor industry to win 
renewal of new car distribu- 
tion's exemption from EU com- 
petition law have been chal- 
lenged by the top US 
automotive expert of 
McCinsey, the international 
management consultancy. 

Mr Glenn Mercer said that 
recent industry trends made 
the manufacturers’ arguments 
- broadly accepted by the 
European Commission last 
month - “Increasingly out- 
dated”. He described the prac- 
tices the exemption was 
designed to preserve as "fairly 
archaic". 

Contrary to the Industry's 
claims, its traditional distribu- 
tion system was obsolete, inef- 
ficient and failed to meet con- 
sumers' needs. Without 
fundamental reforms, the sys- 
tem would become increas- 
ingly uneconomic and out of 
touch with the market 

Mr Mercer's analysis, set out 
in an article in the latest 
McKinsey Quarterly, is based 
mainly on US experience. How- 
ever, he said yesterday that 
most of its conclusions also 
applied to Europe, particularly 
the continent 

European manufacturers 
claim cars are technically 
sophisticated products and 
that they must retain the right 
to supply them only through. 



Servicing time get* slibrten. Jfot tfm pain remain* 


Hours spent in US on servicing per 6<M)OOroiIe3 



. •; Enjoyment rate of daily • 
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franchised dealers. They say 
the system encourages compe- 
tition and benefits consumers 
by assuring high standards of 
sales and service. 

However, Mr Mercer disputes 
these arguments. He says: 

• Many franchised dealers are 
too small to survive in a free 
market while their rale in sup- 
plying information to manufac- 
turers and customers has 
declined as car-buyers have 
become better informed. 

• Car-buyers are increasingly 
dissatisfied with franchised 
dealers. According to US mar- 


ket research, most consumers 
find visiting a dealer even 
more unpleasant than a rfonta? 
appointment 

• The claim that cars need 
special after-sales care has 
been undercut by their increas- 
ing reliability. 

• Franchised dealers are not 
well-equipped for servicing. 
Servicing would often be per- 
formed more efficiently by 
large specialised garages which 
were hot tied to branded manu- 
facturers. 

• Independent franchised 
dealers are no longer the most 


efficient way of selling cars. 
Large savings could be made if 
manufacturers sold cars direct 
to customers, through discount 
warehouse clubs or through 
wholly owned dealerships. . 
• Contrary to European man- 
ufacturers* claims, many cus- 
tomers would like to buy from 
large outlets stocking compet- 
ing brands at one site. Multi- 
brand outlets have already cap- 
tured about 10 per cent of the 
US market, Mr Mercer says. 

Don't just optimise - unbundle; 
The McKinsey Quarterly 1994 
No 3 . 






liJJ 




VF. 




financial times 


THURSDAY NOVEMBER 10 l',»94- ; 


NEWS: UK 


HVtJ| Governme nt is accused of ‘recklessly gambling’ £30m of public money in Scotland 

U P I * Banks fail to revive private hospital 


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By James Buxton and Alan Pike 

SJfiS. 0 ?* ^Jrattonal, the Scottish 
£™j? hospiU1 opened only four 
months ago to cater for overseas 
patients, went into receivership vester- 
day when its bankers were unqh le to 
agree on a rescua 

Tfa * in an enterprise 

tom at Clydebank near Glasgow, had 
been unable to attract enough patients 
and only 20 of its 260 beds were occu- 
pied yesterday. Its failure is highly 
embarrassing for the government 
which committed a total of £30m to the 
£lfi0m project. Mr George Robertson, 


Labour’s shadow Scottish secretary, 
accused ministers of “recklessly gam- 
bling public money on a shaky, ill-con- 
ceived project”, while the Scottish 
Trades Union Congress described the 
hospital as u a harebrained scheme 
which common sense indicated was 
doomed to fail". 

HCI, which employs 400 people, hit a 
financial crisis in September because of 
a severe shortage of patients from its 
intended markets in Italy. Greece and 
the Middle East In spite of its modem 
facilities, the organisation Is unlikely to 
interest other UK hospital operators. 
Feeling in the sector last night was that 


HCI has demonstrated the un viability 
of a Scottish hospital nimpd at the over- 
seas market. 

London private hospitals once relied 
heavily on overseas patients, particu- 
larly from the Middle East, but this 
market has hfcome thinner in r e ce n t 
years. Most hospital operators now bal- 
ance overseas work with UK patients, a 
more important part of their market 

Samuel Montagu, leader of the syndi- 
cate of five banks lending to HCL 
appointed Mr Murdoch McKillop and 
Mr John Talbot of Arthur Andersen as 
joint receivers. They intend to keep the 
hospital operating as a going concern 


for as long as possible while they seek a 
purchaser. 

Equity investors and lenders had 
tried for the last few weeks to agree a 
financial restructuring. Although new 
equity funding was available from the 
Abu Dhabi Investment Company, the 
French bank Credit Lyonnais, one of 
five in the lending syndicate, refused to 
agree to the package, precipitating 
receivership. 

HCI was conceived by two Harvard 
professors, Dr Angelo Eraklis and Dr 
Raphael Levey. The equity investors 
are led by Harvard Management, which 
invests money for Harvard University. 


Protest Murdoch | Monopoly probe for Cook 


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against 

livestock 

shipment 

By Deborah Hargreaves 

Animal welfare groups pro- 
tested at Sheerness in Kent 
yesterday at the fotmnti of a 
ferry service carrying live 
animals to mainland Europe. 
Ferryllnk. a division of the 
Mersey Docks and Harbour 
Company, shipped 3,000 calves 
and sheep to Vlissingen in the 
Netherlands yesterday in what 
it hopes will become a daily 
service. 

The company said it would 
give “the kiss of life,” to the 
live animal trade with 1 ves- 
sels taking up to 12 lorry loads 
of livestock a day after a ban 
on shipments was imposed by 
the leading ferry companies in 
October. Brittany Ferries 
became the last regular carrier 
to quit the live animal export 
trade last Friday. 

Companies such as Peninsu- 
lar and Oriental, which car- 
ried the bulk of live exports 
before the ban, bowed to pres- 
sure from animal welfare 
groups and a public outcry. 

Farmers’ leaders feared the 
ferries’ action would cut off 
access to a lucrative export 
market which is worth £2 00m 
a year. Calf prices tumbled 
last week after Brittany Fer- 
ries joined the boycott 

Fenyhnk says if, win impose 
a strict .code of practice cm 
hauliers to ensure are 

treated well during transit. 
But Brittany Ferries said last 
week the majo rity of haul iers 
had cynically disregarded its 
own code of conduct 

“These people are not inter- 
ested in codes of conduct - 
only in money,” said Hs Joyce 
D’Silva at Compassion in 
World Farming, an animal 
welfare group. 

Mr Bill Moses, managing 
director of Ferrylink, said: 
“We have no wish to be associ- 
ated with unscrupulous 
exporters and any shipment 
which does not meet our strict 
code of practice wHl be refused 
carriage.” 

Exporters have also got 
round the ferry bans by using 
chartered aircraft But several 
airport - authorities have 
moved to stop the trade. 


in talks 
on TV 
news deal 

By Raymond Snoddy 

British Sky Broadcasting is in 
negotiations to have its 24-hour 
television news channel, Sky 
News, supplied under contract 
by Independent Television 
News. 

If the deal goes through it 
would re-create an effective 
BBC-ITN national television 
news monopoly in the UK. 

Talks are believed to be well 
advanced between the BSkyB 
satellite television venture and 
PTN, the 1TV television news 
organisation. They have 
involved Mr Rupert Murdoch, 
chairman of News Corporation, 
Mr Michael Great, p.h»irm«n of 
PTN and of Carlton Communi- 
cations, and Mr Sam Chisholm, 
the BSkyB chief executive. 

Formal agreement has not 
yet been reachecLMr Chisholm 
said last night: “We have 
plenty of suitors who want to 
get involved with us in a whole 
range of areas. ITN is but one.” 

Sky News, which has won 
awards for its journalism, is 
broadcast across Europe on the 
Astra satellite and is av ailable 
to millions of viewers through 
satellite dishes and cable net- 
works. ITN, which supplies 
television news to ITV and 
Channel 4, already provides 
news bulletins and pro- 
grammes around the dock. Mir 
Murdoch controls 50 per emit 
of BSkyB, a consortium in 
winch Pearson, owner of the 
Financial Times has a signifi- 
cant stake. He is committed to 
continuing to provide a 24-hour 
news channel as part of the 
Sky package of channels. 

But for several year&BSkyB 
has been trying to find a more 
cost-effective way of providing 
the news channel. 

T alks took place with the 
BBC about the possibility of a 
merged satellite news channel 
but no agreement could be 
reached neither could agree on 
who should have editorial con- 
trol. 

Sky News costs around £30m 
a year to run and has never 
matte a profit. It is believed 
that the deal on offer from ITN 
could save BSkyB around £7m- 
£8m a year. 


p Survey highlights 
the true cost of 
St’ * open government 



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By WBBam Lewis •. 

Government departments and. 
quangos (organisations outside 
the government whose leaders 
are appointed by ministers) are 
charging large fees for infor- 
mation, which they are obliged 
to disclose under openness 
guidelines based on the Citi- 
zen’s Charter, a survey has 
found. 

Some departments are charg- 
ing hundreds of pounds for pre- 
viously secret information 
which became available under, 
the Code on Access to Govern-* 
-. meat information, introduced 
inApriL „ . . 

The are usually based 
on the costs of staff doing the 
research, and can be as high as 
£45 ($73-80) an hoar. ^ 

■What we have found is 
extraordinary . differences 
between departments’ arrange- 
ments, showing Sow arbi- 
trarily char ges have been set," 
said Mr Maurice Frahkel, direc- 
tor cf the Campaign for Free- 
dom of Information, which car- 
ried out the survey. “Some of 
the charges will preserve 
Whitehall secrecy as effec- 
tively as any Official Secrets 
Act” ■ , .. 


the survey is said by -the Cam- 
paign to be the National Btvere 
Authority, an environmental 
watchdog, which sayB that it 
may change- children ana stu- 
dents who request information 
-for their full-time studies ff « 
.takes one member ‘of -star 
more than half .an hour - to 


undertake the necessary 

The. Minis try of Defence in 
effect rules out providing infor- 
mation which is more expen- 
sive than £200, “since it would 
probably represent an unrea- 
sonable diversion of manpower 
from defence activities”. 

The survey found that three 
government departments - the 
Foreign Office, agriculture 
.. ministry and inland Revenue - 
charge for all requests which 
involve staff in extra work. 
Two other departments - the 
Home Office and the Depart- 
ment of Health - waive 
charges for requests which 
take less than an hour, and 
.charge £20 an hour for others. 

■ The survey found a wide 
variation in charges. For exam- 
■ pfe, the Departments of Trans- 
portand Social Security charge 
for information only if more 
than four hours’ work is 
required, with foes based <m 
the average salary cost of staff 
involved... 

. The cheapest departments 
from which to obtain informa- 
tion appear to be the Lord 
Chancellor’s Department, the 
Public Records Office and parts 
of the Northern Ireland Office, 
an of which allow five hours’ 
work free. The Cabinet Office 
and the Scottish Office waive 
the first CL00 of any charges. 

The Office uf Public Service 
and Science defended the 
charges': and said anyone- dis- 
satisfied should complain to 
the parliamentary Ombuds- 
man. 


By John Gapper 
and Alison Smith 

The acquisition by Thomas 
Cook Group, the travel com- 
pany, of Barclays Bank’s trav- 
ellers’ cheques business h as 
been referred to the Monopo- 
lies and Mergers Commission. 

The acquisition, announced 
in August, would allow 
Thomas Cook, already the 
world's largest issuer of 
Mastercard travellers’ cheques, 
to become the biggest issuer of 
Visa travellers’ cheques as 
welL 

The deal would increase 


Thomas Cook's share of the 
world’s $54bn-a-year travellers’ 
cheque market from 17 per 
cent to 30 per cent. The market 
is led by American Express, 
which invented the travellers' 
cheque 103 years ago, and has 
44 per c«nt of the market 

The Department of Trade 
and Industry said yesterday it 
had referred the acquisition to 
the MMC on the advice of Sir 
Bryan Cars berg, director-gen- 
eral of fair trading. The MMC 
must report by February 16. 

Trade ministers can refer to 
the MMC mergers that inten- 
sify a market share of 25 per 


cent or more in the UK. The 
Thomas Cook deal was origi- 
nally due to he completed this 
week, but has now been put on 
hold until after the MMC 
report. Thomas Cook has sot 
disclosed how much it paid 
Barclays to acquire Interpay- 
ment Services, the subsidiary, 
and yesterday refused to com- 
ment on the MMC referral. 

Thomas Cook intends to 
operate the Interpayment Visa 
brand separately although the 
two brands would use the same 
distribution and processing 
facilities. Integration of those 
facilities has not yet begun. 



Students gather for the march and rally in central London yesterday against cuts in their grants 

Students protest at funding cuts 


Up to 20,000 students marched 
in pouring rain through cen- 
tral London yesterday protest- 
ing about grant cuts which 
they say make it impossible to 
survive without incurring big 

debts. 

The march was organised by 
the National Union of Stu- 
dents, which published a 
report c laimin g that 25 per 


cent of sixth formers aban- 
doned the idea of further edu- 
cation because of financial 
worries. 

Mr Jim Murphy, union presi- 
dent, said cuts in grants and 
increased food and accommo- 
dation costs meant that it was 
cheaper to live on unemploy- 
ment benefit than to take a 
degree. He said the Student 


Hardship Report showed that 
housing costs had risen by 5.5 
per cent last year while the 
grants were being cut by 10 per 
cent a year. 

Meanwhile, the government 
rejected a claim from students 
that there are plans to privat- 
ise student inang and charge 
graduates commercial rates of 
interest 




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10 


FINANCIAL TIMES THURSDAY NOVEMBER 10 1994 


NEWS: UK 


Chemicals help improvement in trade figures 


UK NEWS DIGEST 


Economics Comspondent 

A surge in exports of chemicals and 
capflaJ goods is driving a contmmng 
improvement in the UK’s visible trade 
figures, Central Statistical Office fig- 
ures showed yesterday. 

August’s deficit with the rest of the 
world was a seasonally adjusted 
£63 im, (fl,034m) while July's was 
revised downwards from £704m to 
£555m largely because of changes in 
the calculation of the seasonal adjust- 
ment The CSO says the trend shows 
a continuing narrowing of the deficit 


with exports and imports rising by 
about % per cent a month. 

World trade figures are reported in 
arrears because of the Intrastat sys- 
tem used in the European Union, 
winch is based an value added tax i 
retains. The new element of yester- c 
day’s figures was the EU deficit, n 
which widened to £342m from £17lm e 
in July, in part because of the import w 
from France of trains for the Channel T 
tunnel. Imports from the EU have m 
been rising' faster **»»» those from the 
rest of the world. d 

Mr Adam Cole, a UK economist at n 
James Capel, the brokers, said the a 


rise in EU Imports was significant and 
may mark “a turning point in the 
trend of Ming deficits apparent over 


oil and erratic items such as precious levels in August. Falls in import vaJ- 
stones are excluded, the whole-world umes were recorded in all sectors 
trade deficit in August was £1 19bn over the three months to August, 
torn £Wbn in July. including finished manufactures, 


Over the three months to August, 
the whole-world deficit was £l.97bn 
compared with £2.85bn in the three 
montte to May. Over tbs same period, 
export values have risen 5 per cent 
while imports have grown 2 per cent 
The deficit was £3bn In the three 
months to August 1993. 

The CSO said increases in the value 
of chemicals and capital goods were 
responsible for around half the rise in 
exports over the past three months. If 


from £Wbn in July. 

The CSO estimates that export vol- 
umes - excluding and erratics - 
are increasing by aMif 1 per cent a 
month while imports .ire flat. 

Over the three months to August, 
export volumes were 3 per cent higher 
them in the previous three months 
while imports feU by 1 per cent. 

Compared with the same period of 
1993, exports are up 12 per cent while 
imports are up 6 per cent. Both export 
and import volumes reached record 


where clothing imports fell by 7J> par 
cent. 

The improving trend in volumes 
has not been tally reflected in the 
headline figure tar the trade deficit' 
because of a deterioration in the 
terms of trade. 

Import prices were 3 per cent 
higher in the three months to August 
than in the previous three months 
while export prices were 1 per cent 
higher. 


Government seeks to boost Minister accused on Pergau 

"■ ^ _ T| __ f* ‘WT'Y T mm. ■! nuf n By Robert Rica, the 1980 Overseas Development unsound project”. Sir Tim Lan- 

IflVPI ■■■ TIiJIIm |l . I J PY n||rr\ Legal Correspondent and Co-operation Act by alloc- kester. Former permanent sec- 

RV' T V' Jl v/x U"U JLV WVJ a ting aid money for the retary at the Overseas Develop- 

rv 1 _ it.. 1 1.1 irtf a ■ A J m itii e ti iiH / in orltricafT 


By David Owen 

The British government is 
aiming to lift the proportion of 
UR exports that go to countries 
outside the European Union as 
part of its strategy for stimu- 
lating domestic growth. 

Ministers want to increase 
aon-EU exports to more than 
50 per cent of the total before 
the next general election due 
by 1997. 

They are keen to promote 
British exports to relatively 
fest-growlng economies in Asia 
and Latin America. 

On Sunday, Mr Richard 


Needham, trade minister, is 
due to leave for India at the 
head of a party of more than 80 
business executives in what 
the Department of Trade and 
Industry is billing as its 
biggest -ever trade mission. 

The group will fly to Cal- 
cutta, Delhi. Bombay and 
Madras for a week-long pro- 
gramme of meetings. 

Official figures indicate the 
government is well on the way 
to achieving its target exports 
to the EU amounted to £46 Jbn 
or 52.6 per cent of the total in 
the eight months to August 
This compared with £63J9bn or 


We': 


52.7 per cent in 1993 and 
£589bn or 57 per cent in 1991. 

Last October, non-EU 
exports - at £523bn - margin- 
ally outstripped exports to EU 
countries - at £528bo. It was 
the first month for more than 
three years in which this had 
happened. 

But next year’s expected 
enlargement of the EU may 
make the target more challeng- 
ing than it appears. 

The way is clear for four 
European countries - Sweden, 
Norway, Finland and Austria - 
to become members of the EU 
in January 1995. 


By Robert Rice, 

Legal Correspondent 

Mr Douglas Hurd, the UK 
foreign secretary, was yester- 
day accused in the High Court 
of acting unlawfully in ear- 
marking £234m from the over- 
seas aid budget for the Pergau 
dan^ in Malaysia. 

The World Development 
Movement, a lobby group for 
developing countries, is seek- 
ing to have his decision 
quashed, to recover the £29.6m 
already spent, and block fur- 
ther payments from the aid 
budget for the dam ’s construc- 
tion. The next instalment is 
due to be paid in December. 

The group claims Mr Hurd 
overstepped bis powers under 


the 1980 Overseas Development 
and Co-operation Act. by alloc- 
ating aid money for the 
improper purpose of promoting 
trade with Malaysia. The act 
says the primary purpose of 
aid must be the economic bene- 
fit of a foreign country or the 
welfare of its people. 

Mr Nigel Pleming QC, the 
group's counsel, said the pur- 
pose of the act was “aid - not 
trade’' and Mr Hurd's decision 
had deprived poor countries of 
British funds which should 
have been spent on them. 

Mr Pleming said the use of 
aid could not be said to be for 
the economic benefit of Malay- 
sia because when Mr Hurd 
took the decision, “Pergau was 
unequivocally an economically 


unsound project”. Sir Tim Isn- 
kester. Former permanent sec- 
retary at the Overseas Develop- 
ment Administration, advised 
that the dam was uneconomic 
a nd funding it was an “abuse 
of the aid programme’’, but he 
was overruled. 

The government has 
accepted that if it loses the 
court case, the bill for the dam 
will have to be met by another 
government department 

Mr Roger Briottet, WDM 
director, says the £234m ear- 
marked tar the project Is equal 
to twice as much as afi. British 
aid for water and sanitation for 
the last five years or half 
Britain's aid to sub-Saharan 

Africa in 1992/93. 

The hearing continues today. 


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as court rules be 

(acted unlawfully 

The British, government’s new compensation 

victims of violent crime, in trodu ced in April, was ruled uniaw- 

SSffit ?ȣ*& frr Mr M. 

t ^te 0 S,rt£ldto' MS 

powers” by implementing the scheme without referring it to 

Howard said last night he would be appealing against 

i tiie decision to foe Lords. . ' 

Hie new tariff-based scheme sets fixed levels ^compensa- 
tion for different categories of injury, replacing the 
aHmnp based an personal injury compensation rules, widen 
took account of individual circumstances- 
The said the new scheme was necessary to euxp 

soaring compensation costs. It said unles s cha nges were made, 
the cost of payments would rise from £224zn to £550m 

^Tfaifniling prompted immediate opposition d emands for Mr 
Howard's resignation. 

Offer made to Maxwell groups 

A group of investment banks and former professkmal advisers 
to pension schemes controDed by the late Robert Maxwell has 
offered to pay between £200m mid £30Qm to obtain a “global 
settlement” of all outstanding claims. - 
Trustees of the schemes and their advisers yesterday mot Sir 
Peter Webster of the Maxwell Pensioners Trust who told them 

of the offers. 

Sir Peter bad set a deadline of November 4 by widen time ail 
offers of settlement had to be made. Those which did not make 
“credible” offers could expect legal proceedings against them 
to cantinueL 

However, trustees had been hoping to receive an offer closer 
to the £44Bm estimated to have disappeared from the schemes 
before Maxwell's death In November 199L 

Third setback for Eurostar 

Eurostar, the high-speed Channel tunnel passenger train, yes- 
terday suffered its third embarrassing breakdown within a 
month. Euroetar will start a regular service linking London 
with Paris mid Brussels through the tiranai next Monday. 

One of the £24m trains due to carry a party of MFs to Paris 
developed a technical hitch and had to lie replaced, causing a 
30-minute delay. 

On October 20 a train due to carry 400 journalists through 
the tunnel on a promotional trip suffered a similar hitch while 
the following day a train carrying British Rail chairman Sir 
Boh Reid and Eurotunnel co-chairman SirAlastair Morton had 
to be taken out of service at Calais. 

European Passenger Services, the UK aim of Eurostar, said 
most of its test tuns had been, trouble-free and it was confident 
its public service would run smoothly next week. 

£500m power station plan 

Up to 700 jobs are to be created building' a £S 20 m gas-fired 
power station near Grimsby, Humberside County Council said 
yesterday. 

The station is being built by a consortium including Mid- 
lands Electricity, the regional power company, JVO, Jhe Fmn- 
ish electricity company and Japanese trading company 
Tomen. 

Humberside said the station was one of the largest inward 
investments into the UK. The station is doe to open in 1997, 
creating up to 100 permanent jobs. 

Norman CNedH, chairman of Humberside county council's J 
economic development sub-committee, said the investment 
was the first of many in line for the area. 

However construction of the station, which will have a 
capacity of 75GMW, has been seen as a setback for the coal 
industry. When it is fully operational it will displace up to 2m 
tonnes of coal a year. 

Human rights award for Hume 

Mr John Hume, leader of Northern Ireland’s Social Democratic 
and Labour party has won major peace and human rights 
awards in the United States and Italy. 

He is to join former Soviet and US leaders Mikhail Gorba- 
chev and George Bush to receive the Pio Manzu Institute 
award tar peace, in Rimini at the weekend. Mr Hume is also 
due to receive an award from the International League of 
Human Rights at the UN in New York next month. 

The MP for Foyle, in Londonderry, trim has been at the 
centre of the Northern Ireland peace process has already been 
nominated tar the 1995 Nobel Peace Prize. 

Ealing offers expected soon 

Serious offers for Ealing Studios - home of some of the most 
famous British films - are expected within days, it emereged 
yesterday. Receiver Mr Alan Price - speaking the day after 
one of the country's newest film production com pa ni es , Metro- 
dome, put forward a rescue plan * said he was “optimistic" of 
finding a buyer. 

The two-year-old company announced it was prepared to . 
provide half the money to buy the studios and was actively 
seeking a partner willing to meet the rest of the cost 
The fete of the west London studios, used in the 1940s and / 
1950s for comedy classics such as The Lavender H3H Mob and i- 
The LadykOlers, Is in the balance after owners BBRK became 
insolvent last month. 

Mr Price said Metrodome was just one of a number of 
companies which bad shown an interest In tatting over Ealing. 


Casino advert ban 
may be relaxed 

The sary red tape. The current 
government is complete ban on advertising 

W considering for casinos was “ripe for 

relaxing the review", he said. “There are 

wHv strict rales gov- legitimate concerns that unres- 

eming adver- tricted advertising would send 

tising by casl- out the wrong signal to those 

the HATfOMAJL nos and betting who might be vulnerable to 

lottery shops, Mr excessive gaming. But I fhtwfe 

Michael Howard, home secre- there is a case for your being 
tary, said yesterday, our Mar- allowed to give out information 
aetmg Correspondent writes, about yourselves, the location 
Pressure an the government to and facilities offered." Similar , 
ease gaming restrictions has restrictions in other areas 
merrased with the advent of would be examined. Betting 
the National Lottery, tickets shops are allowed to advertise 
tar much go on sale on Mon- on posters, but are not allowed 

to state their location. 
in £ Iud - * *** Sports Council said yes- . 
mg the football pools, have terday it expected £l.6bn4s 
won concessions following <$2.6bn) to be available for 
j® 10 lotteryis sport between 1995 and 2000 
8ame from the National Lottery. 

Prt>mo- Local sports facilities and a 
88 other Poss* 1 * new national stadium 
fomis of gambling. may be funded by the lotted 

fito Howard told the British which is first drawnon 
Casino Association that the November 19. Snort is one of 

88 part 01 1ta receive an equal share from 
effort to cut down on unneces- every £l ticket sold. 


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FINANCIAL TIMES 


Thursday November 10 1994 * 

MANAGEMENT: MARKETING AND ADVERTISING 


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.. ow _ do independent 
' schools improve their 
-market position, as 
-recession continues to make 
inroads into pupil numbers? Ike 
muswfci seems to be: by moving 
op the league tables. 

P are nts ■ place increasing 
weight on exam results with the 
consequence that those schools 
which perform weD cite their 
league position in their advertis- 
ing; 

At face value, fc a wel- 
come development If schools 
are forced to i mpr ove nrariami* 
results, they are boosting the 
fundamental quality of their 
product But the suspicion is 
harbou red in some quarters to»* 
certain schools have worked out 
how to doctor the results. 

After the FFs school survey 
was published last month, a 
humorous missive arrived from 
Uppingham, a Leicestershire 
boarding school. The 
Uppingham Newsletter, tongue 
in cheek, provided heads with 
ways to massage their figures: 

• Challenge the results with 
the ex a miner s. “Obviously you 
won't want to include the 
results in your statistical sub- 
mission, because they are not 
really results at aR are they?” 

• “Weed out* pupils who do 
badly in the mode exams. "Obvi- 
ously Nigel should not be 
allowed to take the A-leveL It 
wouldn’t be feir on him.* 

• Establish a “private examina- 
tion entrance centre-St Cus- 
tard’s”, and eater, your 20 per 
cent weakest candidates there: 
“St' Custard's won't do very 
well, but yon wiHP 

• Recruit pupils from Ger- 
many, for example, and enter 
than for 'A4evd German. 

• (halt' results for those who 
have been at the school “just for 
-a year's experience - they can't 
be expecied to do terribly well*. 

• Start at the Wiry beginning 
and refuse to permit students to, 
take *har d*V subjects, even if 

they want to. 

: Th* riewafetter notes mischie- 
vously: “Nobody would even 
think : of such things, would 
they? You'd be surprised!” - 

John Anthers 


W hen women in Ma&hl 
and Lisbon want a Ifira, 

they head for Marfa 
and Spencer. The JJK* 
««ea cunning and food retails- is 
buadmg a Spanish and Portuguese 
sta ffing em pire <m selling lingerie. 
2“® reason, say M&S managers, is 
that local retailers are decades 
behind in the way the y sell these 
intimate garments. • 1 

Many offer mdy three sizes dfbra 

“ small, medium or large. Products 
are displayed in glass caw ?; buy ing 
one requires an assis tant reaching 
UP and taking a box from a shelf 
behind the counter. Marts and 
Spencer, by contrast, sells a wide 
yfg 6 of bras, displayed on open 
fixtures, in 17 sizes. “We really do 
lead the world in bras and knick- 
ers,” says David Dewhnrst, commer- 
cial manager of Marks and Spen- 
cer’s Portuguese franchise. 

Bring a successful international 
retail er, however, means more than 
providing 17 bra sizes, as Marks and 
Spencer has discovered. The history 
of its expansion overseas has not 
always been happy. 

hi 22 years of trading in naiy»dfl it 
has rarely done better than break 
even, with local inhahwanta never 
really talcing to its stores. 
D’AUaird's, the Canadian chain 
M&S acquired in the 1970s, has, per- 
formed a little better. 

Afore recently, M&S underesti- 
mated the work it would have to do 
to bring Brooks Brothers, the 
upmarket US clothing chain 
acquired in 1987, up to group stan- 
dards. Elsewhere, however, across 
Europe and in east Asia, Marks and 
Spencer is at last haenming a suc- 
cessful cross-border operator. 

As well as 322 Brooks Brothers, 
D’AHaird’s and King * Super Mar- 
kets stores in North America and 
Japan, and its 40 M&S stores in 
flanarfa, it has 32 company-owned 
stores in six countries outside the 
lint, from .the Republic of Ireland to 
Hong Kong. It aiwi has 76 franchise 
stores in 18 countries from Austria 
to Indonesia. In its most recent fitH- 
year results, 18 per cent of Marks 
and Spencerfe turnover and 7 per 
cant of operating profits cama from 
outside the UK. 

It used to be a ride of retailing 
that stores groups that succeeded 
overseas were those that “sold their 
country", whose image and prod- 
ucts were closely associated With a 
-‘particular mtinn. 

That zto langpr holds true. Retail- 
ers such as Toys R Us of the US and 
foe Swedish furniture retailer Ikea 
dominate every market they enter 
not because they are American or 
Swedish, but because they sell a 
bigger range of better products than 
their compet ito rs, at better prices. 
The UK’s Body Shop has expanded 
into . 45 countries by innova- 

tive “natural” products. Britishness 
searpriy cornea into IL : 


Neil Buckley explains why it took so 
long for Marks and Spencer to crack 
the international retailing market 

Food for 



MSS on Parts’s Rue da RSrotfc Its best-aalfing products are Incfian ready meals 


What these retailers have in com- 
mon is a “unique point", set- 
ting them apart from competitors. 
Marts and Spencer’s USP, however, 
is complex; customers outside toe 
UK seen drawn to its stores for 
many different reasons. 

Part of the reason is still its Bri- 
tishness. Overseas store managers 
admit that elaggir “British" prod- 
ucts, such as Harris tweed jackets 
or flannel shirts, always sell welL 
But, says Juan Jinojosa, a director 
of Cortefiel, the Spanish retailer 
which owns 20 per cent of Marks 
and Spencer's Spanish business: 
“Early in the life of Marks and 
Spence r in a new country, its Brit- 
ish appeal is important. But the day 
quickly comes when the appeal is 
more the strength of the product 
and the service.” 


An important reason for custom - 
ere choosing M&S is that it offers a 
variety of other products not avail- 
able locally, at least in such depth, 
or for such a good price. Lingerie is 
in this category - in Madrid it 
accounts for almost a quarter of 
turnover, compared with 13 to 15 
per cent in UK stores. Ghfldren’s- 

Some times the products are more 
unusual, especially in food. In 
Marks and Spencer's new Paris 
store, which opened in September 
on the Rue de Rivoli, some of the 
best-selling products are ready 
nraalg , especially Indian meals - not 
widely available in France. 

But perhaps the most important 
in gredient of Mar ks and Spencer’s 
oversees stores is that they are able 
ta meet local tastes and after prod- 
ucts similar to those in local stores 


- but at superior quality and prices. 

Both internal and external factors 

have made M&S better able to do 
this now than it was when it first 
expanded overseas In the 1970s. One 
external factor is that international 
tastes have started to converge, due 
to growth in foreign travel and 
cross-border television and media. 

Alan Lambert, Marks and Spen- 
cer's divisional director for conti- 
nental Europe, says the “European 
consumer" is now a reality. “I per- 
sonally wouldn't narrow it down to 
Europe,” he adds. “There is already 
an international consumer.” 

Indiv idual tastes do p e rsist in dif- 
ferent countries, but internal 
changes have helped Marts and 
Spencer address these. The group 
has developed the flexibility to con- 
struct a product offer made up of 
“core" bestsellers surrounded by 
products tailored to local markets. 

This does not work everywhere - 
ranadfl being the obvious pxarpp ip 

— M&S Still n inVoo 

but it has learned to rectify these 
more quickly. Dewhnrst says 
research a few years ago in Porta- 
gal found shoppers loved Marks and 
Spencer's lingerie, hut thought its 
clothing “ugly". By swapping the 
contemporary bodies and leggings it 
had been trying to sell for more 
“classical" blouses and skirts, it 
was able to meet local tastes. 

With all tills in company-owned 
stores linked to a giant computer 
centre in west London, and fran- 
chise operations increasingly bring 
linked to the same system, toe 
group «vn quickly pick up trends, 
spotting which products are not 
selling, «nrt mak e adjustments 
accordingly. Moreover, all products 
are sourced through its central buy- 
ing organisation mp piiwr net- 
work, which, says Alan Hodges, 
Madrid store manager, means M&S 
ran be “unbeatable value”. 

That is in spite of M&S's prices in 
continental Europe hg»ng about 20 
per rant hi gher than in the UK, 
owing to higher distribution costs. 
Prices, however, are coming down 
as M&S adopts its “outstanding 
value" campaign across Europe, 
involving lowering prices on popu- 
lar products to boost volumes. 

There are perhaps two important 
lessons to be learned from Marks 
and Spencer’s experiences. One is 
the hn pnrtanra of flexibility. Trans- 
planting a store format and its prod- 
uct range from one country to 
another, as M&S tried to do in the 
1970s, is not enough, even in the age 
of today's international consumer. 
The complexities of local tastes 
must be catered for. 

But successful cross-border retail- 
ing does not necessarily entail rein- 
venting tha wheel, raining up with 
a highly innovative store format or 
concept hi the words of Alan Lam- 
bert “Quality, service and value 
will sell anywhere.” 


Deutsche Bank’s 
motley crew 

Andrew Fisher on a different kind 
of corporate advertising by 
Germany’s biggest bank 


P ut together a theologian, a 
car company executive, a 
trade unionist, a former 
government minister and a couple 
of professors and what do you 
have? A motley collection, some 
would say, but for Deutsche Bank 
toey have a common link. To 
Germany's largest bank, this is a 
group of people who can help 
polish its image after a year of 

hard tmnrlrg. 

From Sunday, it will run a 
series of heavyweight 
a d vertisements in German 
newspapers where these 
individuals’ views on wort and 
society in an uncertain future will 

be comprehensively presented. 

The bank will scarcely be 
mentioned, flltoong h its name and 

Hne-in-a-box logo will be printed 
at the foot of the articles. 

Why is the bank doing this? 
Clearly, an image-burnishing 
campaign would not go amiss at 
the end of a year in which it has 
fog hi re d rniramfiyhihly in too 

spotlight. First, its role as 
shareholder and creditor of 
MetaBgesellschaft, which made 
heavy losses on US oil futures 
trading, was highlighted Then 
came Jfirgen Schneider’s 
collapsing property empire, to 
which the bank was a significant 
lender , followed by his 
disappearance. Banks in general 
have been criticised for being too 
inattentive to customers’ needs. 

Bid the current campaign, 
masterminded by Abels & Grey, a 
self-styled corporate mission 
agency in Dflssridorf, is not like 
the usual hurst of promotions. He 
latest run of advertisements has 
more to do with broad social and 
philosophical issues, although the 
agency does plan an image 
campaig n along more usual lines 
next mouth. 

Such a concept-oriented 
approach in advertising is novel. 
Horiumt, toe German marketing 
weekly , says the campaign 
“breaks through the accepted 
boundaries of institutional 
communication". Its thama is 
Wort of the Future - the Future 
eff Wort; the articles are 
somewhat daunting two-page 
reprints of speeches an the subject 


by Hans Kflng, a c ont ro ve rsial 
Catholic theologian, Heinz 
Riesenhuber, former research 
minister, Wolfgang Brittle. BMW's 
development director, Walter 
Riester, deputy head of the LG. 
MetaU trade union, and two 
professors from Constance and 
Bonn. The speeches ware given at 
a conference of the Alfred 
Henfcausen Society, formed in 
memory of the bank’s former 
chairman, killed by terrorists five 
years ago. 

This week the bank has run 
60-second television commercials 
fore shado win g top campaign 
against a background of job 
uncertainty. According to 
Horizont; “No large German 
company, and certainly none of 
the big banks, has dealt with such 
social themes in a way that is so 
public and so removed from its 
own business". 

It calls the bank’s action 
“courageous” but says it also 
carries a high risk, especially 
since each article would be 
prefaced by the words: “Deutsche 
Bank - we support the fixture." 
This would be a yardstick by 
which the bank would be 
measured. 

Deutsche Bank accepts this risk. 
“We are under the gaze of the 
public,” writes Bflmar Kopper, the 
rfiafrman, in Forum, its house 
ma gnrhig “As one of the lea<£ng 
corporations in Germany, we are 
quite obviously involved in many 
social activities which go beyond 
the purely commercial. ” By this, 
he means the bank's 
responsibilities as an employer 
and member of the community, 
supportin g mvi ra n mmt a l 
research and helping the disabled. 

It is this “other side” that the 
bank wants to bring more into the 
open. Kopper says Deutsche 
Bank's “traditional reticence” 
about the wider aspect erf its 
activities had led to “a certain 
one-sidedness" In the public's 
view. In future, it would provide 
more Infor mation about how it 
fulfilled its social responsibilities. 

Horizont hopes more companies 
will follow suit No doubt, they 
will await the response to 
Deutsche Bank's campaign first 


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c«ap«nl« ft : Brtgtan, 
CiKKla, FnHKf, Germany 
Itangisag, My. 
Japan, li imnto s 
Malaysia, Medea, 
Netlwrtaato nnagai 
ilB flqiBW. Spa*. 
Kingdom uatad Sub. 


This figure speaks not only of AXA's 
size, as one of the world’s insurance 
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perhaps unique efficiency. 

These clients five on three continents, 
in 1 6 countries, each of which has a 
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Our experience as the fourth largest 
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So you can see that we are not 
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A MI 

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INSURANCE & INVESTMENT 












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A Ion Greenspan be 
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ipanose parliament elected Socialist Party's Murayatna as 
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Bundesbank President Hans Tietmeyer hinted at lower rates 
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U.S. Treasury Secretary Lloyd So 
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President Chntcn told G7 news conference in Naples that 
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In exclusive interview after Bundesbank press ccr.ferei.ee 
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In exclusive Reuter interview. Sweden's central bank 
governor Urban Backstrom attempted to calm markets 
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U.S. Trade- Representative Mickey Ksnior discussed 
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FINANCIAL TIMES THURSDAY 


NOVEMBER 10 1 't94 


TECHNOLOGY 


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A pregnant woman lies on an 
examination table at St 
Mary's Hospital on the Isle 
<tf Wight An ultrasound scan has 
picked, up a potential abnor malit y 
in her baby. 

Eighty miles away, in Queen 
Charlotte’s Hospital in London, 
an expert is watching the 
progress of the scan as It tain* 
place on a TV screen. At 
intervals, he freezes the screen 
and takes measurements of the 
image. Within a few minutes, he 
is able to assure the sonographer 
and patient at the other rad of the 
line that the pregnancy is normal. 

This system of transmitting 
scans at St Mary’s to specialists in 
London via an Integrated Services 
Digital Network (ISDN) link is 
now in the early stage of a 
six-month triaL 
: Several benefits of the system 
are already apparent, according 
to Nicholas Fisk of Queen 
. Charlotte's Hospital. It spares 
many women the anxiety of 
waiting for a consultation and the 
expense of travelling to a 
specialist centre. Because it is less 
. stressful for the mother, 

. sonographers are more likely to 
get a second opinion for 
borderline cases. 

The system may also save the 
specialist hospital time and 
money. The equipment - provided 
by BT for the trial - costs around 
£60,000. Bat it may allow the 
specialists to be more productive, 
reducing the £500 cost of the 
average consultation. 

The Isle of Wight experiment is 
not unique. The falling cost of 
equipment is encouraging 
hospitals around the world to 
experiment with telemedicine - 
transmission of medical data and 
images between medical centres - 
in order to improve services for 
remote areas or to nmfr» top 
specialists available to countries 
that lack a particular expertise. 

Last month, doctors in Saudi 
Arabia were finked to specialists 
in the r&Boiogy and pathology ' 

■ departments-lnthe 
Massacbnssetts General Hospital, 
in what WeQCare, the network 
proyider, desmbes as the first 
/atematiMial telemedicine link. 

The system works by digitising 
and compressing images of 
patients' X-rays. MKI (magnetic 


Resonance imaging) and CT 
(computerised tomography) scans. 
These are then sent down 
telephone lines in the course of a 
few minutes to specialists at 
Massachusetts General Hospital, 
who can respond in minutes if the 
case is an emergency. Patients are 
charged the same fee as those 
who visit the hospital in person. 

The advantage is that this 
system depends on ordinary 
telephone lines. 'Doctors and 
patients most likely to need this 
service are those least likely to 
have access to sophisticated 
telecommunications," says Ricky 
Richardson, executive 
vice-president of WeSGare. 

Video conferencing is another 
increasingly important strand of 
telemedicine. Over the past year, 
a video connection between a 
community hospital at Peterhead 
in Scotland and the Accident and 
Emergency Specialist Centre in 
Aberdeen has saved many 
patients hum having to make 
a ZOO-mile round trip to Aber- 
deen. 

A wide range of medical 
problems can be diagnosed in this 
way. Even psychiatric patients 
can be interviewed using video 
links, according to Steinar 
Pedersen, bead of the department 
of Telemedicine at the University 
Hospital in Tromso, Norway. 

“The patient feels in complete 
control.” he says. 

Doctors who have taken part in 
these experiments with 
telemedicine report that problems 
have tended to be related to 
administrative, rather than 
medical, matters. Telemedicine 
often cuts across existing funding 
mechanisms. It also raises issues 
of medical accountability and 
liability. But the champions of 
telemedicine believe these 
problems are surmountable and 
should be offset by its numerous 
advantages. 

They believe that telemedicine 
cuts the expense of consultations 
and so offers a partial solution to 
the spiralling costs of hospital 
care. It fits in with the ambitions 
of the OK government to 
decentralise the National Health 
Service. It should also make 
specialist services more 
convenient and accessible for 
patients. 


A young man triumphantly 
slams a basketball through 
the hoop while a woman 
works out on the treadmilL 
Dozens of used running shoes are 
heaped in the comer, and a golf 
player awaits his turn to try out his 
back swing on the astroturf. 

This is not an exclusive health 
club, but the research laboratories 
of Reebok in Stoughton, Massachu- 
setts. For Reebok. as Tor other high- 
tech sports shoe makers such as 
Adidas, Nike, LA. Gear and New 
Balance, recreation is big business. 

The basketball player is stepping 
on a sensitive “force plate", a device 
beneath the boards that measures 
the force of the player’s landing 
alter his jump. The woman on the 
treadmill is wearing reflectors on 
strategic parts of her legs and feet 
The action is recorded on 
highspeed video - the reflectors' 
movements are then isolated and 
fed into a computer, where they will 
be studied in detail 
The heaps of running shoes will 
be inspected to determine how well 
they held up over miles of use. and 
the golf player will eventually be 
converted into a computer stick fig- 
ure, so that scientists can study the 
movement of his foot during the 
back swing. 

Technology in the sports shoe 
industry has come a long way In 
the last 20 years. In the 1960s. most 
people expected no more from a 
sports shoe than a Uttle foam and 
rubber, with canvas or leather on 
top. The running craze of the 1970s 
sparked the first interest in shoes 
tailored to a specific sport. 

Since then, the sector has blos- 
somed. Companies have tapped 
research in the aerospace and trans- 
port industries to make improve- 
ments In design. Shoelaces have 
been replaced on many models by a 
less complicated strap system. 
Sports shoes are pumped up with 
air, reinforced with high-tech mate- 
rials, sculptured to the foot and 
manipulated to eliminate excess 
weight 

Consumers have responded 
enthusiastically. The global whole- 
sale athletic footwear industry 
reached $12.1bn (£7.3bn) in 1993, 
according to the NPD Group, a mar- 
ket research firm. For 1994, the fig- 
ure is forecast to be even higher 
. Manufacturers are always looking 
for new sports to add to their prod- 
uct line. The recent enthusiasm for 
mountain biking inspired a crusade 
for the perfect mountain-biking 
shoe. Adidas is considering develop- 
ing a shoe Tor snowboarding, a 
sport which has taken off in the US, 
and New Balance just arrived on 
the market with a new boat shoe, 
an alternative to moccasins. 

Companies are also trying to 
expand their market by making 
shoes for sports more commonly 
played in Europe and Asia than in 
the US. Nike, for instance, will 




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Front runners: atfrfetes such as Roger Black (JeflJ and Richard Nerurfcar want the superior performance dafivanad by high Isch 

Sports footwear manufacturers use high technology to 
cater for all kinds of athletes, writes Victoria Griffith 

Shoes that go 
one step ahead 





introduce a new line next year that 
includes footgear for squash, hand- 
ball, volleyball, cricket and rugby. 

Hiking boots are also attracting 
attention, and for good reason. 
While a tennis shoe, for instance, 
rarely sells for more than $120 a 
pair, hiking boots are often $200 or 
more. There is also much room for 
improvement. Most hiking boots are 
unnecessarily uncomfortable, 
according to Spencer White, head of 
research at Reebok. 

Because every sport involves dif- 
ferent foot movements, manufactur- 
ers say athletic shoes need to be 
tailored for a specific use. Games 
such as handball or tennis, for 
instance, require a great deal of lat- 
eral (side-to-side) movement, requir- 
ing a more stable shoe than one 
worn by walkers. Soccer players 
like a shoe that fits like a glove, and 
used to buy footwear too small 
before manufacturers latched on. 

American football players need 
good traction. However, if the shoe 
gets stuck on a twisting movement. 


they can hurt their knees. Reebok is 
trying to design a shoe that would 
offer both forward and lateral trac- 
tion, but would still give way on a 
twisting motion. 

Even within one sport, athletes’ 
needs may vary. A dribbler, or 
defence player in basketball, for 
instance, needs to move fast and 

Footwear 

manufacturers were 
met with surprise 
when they showed up 
at aerospace and 
transport fairs 

usually prefers a lighter shoe. But 
offensive players are normally big- 
ger and heavier, and require more 
stability in the heel for jumping. 
“Everything is important, from the 
form on which the shoe is built to 
the heel width to the tread pattern.” 


says Edith Harmon, product devel- 
opment manager for New Balance. 

Besides laboratory testing, manu- 
facturers rely on top athletes and 
testers, often referred to as the 
“weekend warriors", for input “The 
big athletes are important, but we 
get even more feedback from people 
who play sports casually," says Guy 
Marshall, a footwear designer for 
Adidas. 

One of the main challenges in the 
industry is to design a shoe that is 
both light and strong. “We are 
looking to take every last gramme 
Of material out White maintaining 
the shoe's stability " says Harmon. 

The right materials are of prime 
importance. Footwear manufactur- 
ers were met with surprise when 
they showed up at aerospace and 
transport fairs in the 1980s. Now 
they have formed direct contacts 
with chemical firms and other 
materials developers. 

Nike, for example, uses a Du Pont 
concoction called Kevlar for its ten- 
nis shoe line. “One of the main 


problems in a tennis shoe is getting 
durability in the forefoot, because 
players tend to drag their toes,” 
says Bichard Oldfield, product line 
manager for the group. “Kevlar 
added strength to the shoe without 
introducing heaviness." The mate- 
ria] was used in bullet-proof vests 
and for brake pads on logging lor- 
ries before Nike took it up. 

. Makers of running shoes, which 
need to be especially lightweight, 
started experimenting with mesh 
materials in the 1980s. Now meshes 
are everywhere. Nike also uses a 
material called Ultralam, used in 
winds ails for windsurfing, for its 
crosscountry training shoes. “It is 
light-weight, thin and strong, and 
we apply it In areas needing extra 
support," says Oldfield. 

One of Reebok’s latest products, 
the InstaPump Fury, makes good 
use of high-tech materials to 
achieve a lighter weight The com- 
pany's studies revealed just how lit- 
tle pressure most runnera place on 
the arch of their foot. The manufac- 
turer's response was to el iminate 
the central section, concentrating 
material In the forefoot and heel 

The result looks like a cross 
between a high-heel biking boot and 
an alien’s idea of walking shoes. 
The foot is given support in the 
arch through an incredibly thin, 
lightweight and strong material 
called Graphlite. The material, orig- 
inally used in the wings of aero- 
planes, runs gifl-gs fibres one way 
and carbon fibres the other, and is 
covered with a plastic resin. “The 
three materials together are much 
stronger than they would be sepa- 
rately," says White. 

To try to eliminate stress and 
injury. New Balance uses former 
transport industry shock absorbers 
that were once used as a replace- 
ment for a heavy steel spring. It 
also manufactures long-distance 
running gear with high-wearing, 
abrasion-resistant rubber. 

One of the most important inno- 
vations in recent years has been air 
tubes. Nike and Adidas use air 
chambers in shoe soles for light- 
weight stability. Reebok uses inflat- 
able uppers for a snugger fit 

It is uncertain how Ear the indus- 
try can take its fascination with 
high technology. Marshall says the 
last significant innovation was the 
air pump. “We are waiting for some- 
thing really big like that to take the 
industry forward again." 

Fashion, of course, will play a 
part in the industry’s future, but 
manufacturers say it is not their 
mainstay. “A lot of people who buy 
these shoes may never practise the 
sport,” says White. “They just want 
to wear something that looks cool. 
We love these people, but we can’t 
survive just with their purchases. 
We need athletes who buy the shoes 
because of their superior perfor- 
mance. And that is where the high 
technology comes in." 




Reuters’ Sanderson 
takes on die States 




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Renters Holdings, the fin a ncial 
information and news com- 
pany,'- has promoted Michael 
Sanderson, chief executive 
officer of Jhstinet, its fast-grow- 
ing, US-based equity brokerage 
service. From January 1, he ■ 
will become chairman of Reu- 
ters. America Holdings, winch 
oversees all the group’s activi- 
ties; in the Americas. 

Sanderson, 51, who will con- 
tinue as Instinct’s chief execu- 
tive, win report in both rotes to 


■ David Thompson has been 
appointed md of James 
Robinson, part of HOLLIDAY 
CHEMICAL HOLDINGS: be 
moves from BP Chemicals and 
succeeds Robert Rae, deputy 
chairman, of James Robinson, 
who becomes md of Holliday 
Pigments. 

■ Ian Upson has been 
appointed md of 6SS0 
PETROLEUM Co and joins the 
boards of Esso UK, Esso 
Petroleum Company and Esso-; 
Exploration and Production 
UK 

■ Paul White, formerly 
financial director for Marconi . 
Radar and Control Systems, 
has been ap poin ted finance 
director for UKAEA - 
Government Division. 

■ David Dunbar has been 
appointed director of US-b ased 

EnviroTech, part of WEIR. 
GROUP: he is replaced as 
chairman of Darchem 


Andre Vfileneuve, an executive 
director of the London-based 
group who currently chairs 
Reuters America Holdings. 

Instinet, Reuters America - 
responsible for the group’s 
financial . information and 
media activities - and Reuters 
NewMedia, which has recently 
made a series of small multi- 
media acquisitions in the US, 
wfll continue to operate as sep- 
arate entities. Brian Vaughan, 
president of Reuters America, 


and Buford Smith, president of 
Reuters NewMedia, will report 
to Sanderson. 

ViDeneuve said the appoint- 
ment was an important stage 
in the development of the 
group’s activities in the Ameri- 
cas. Including revenue from 
Instinet, the US now outweighs 
the City of London as the 
group’s biggest single market 

Sanderson -joined Instinet as 
president and CEO in 1990. 
Before that he was with Merrill 
Lynch, where he started in 
1967 as an investment execu- 
tive. rising ultimately to the 
podtian of chairman and ceo of 
Merrill-Lynch Canada. Andrew 


Kermans finally bow 
out at BS Group 


Fleming. 


A long and bitter boardroom 
straggle at BS Group, the Bris- 
tol-based property and leisure 
company, has come to an end 
after three members of the 
Kerman family resigned. 

The announcement was the 
culmination of the efforts of 
non-family shareholders to 
remove the Kerma ns, who 
have been associated with BS, 
formerly Bristol Scotts, since 
before the second world war. 

In Angnst, Anthony Kerman 
was deposed as chairman and 
replaced by Sir Ian Rankin. 
Two months later Scotts HoM- 
thgs, a property group based 
in Singapore, bought the Ker- 
mans* 36.97 per cent stake in 
the company for £3.1m. This 
was held by Anthony Herman, 
his brother Nicholas and their 


Ross Goobey puts his 
words into action 


jrf? <rs ‘ £ 

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Alastair Ross Goobey, chief 
executive ofPostel Investment 
Management and one of the 
most forceful advocates of 
property as a financial asset, is 
taking over as president of the 
Property Investment Forum. 

. The Forum was set up seven 
years ago to debate and com- 
ment on issues relevant to the 
property investment commu- 
nity. It now has around 700 
members drawn from the prop- 
erty, legal, actuarial and other 


Ross Goobey’s involvement 
is sure to raise the profile of 
the group. In addition to run- 
ning the UK’s largest pension 
Amd, he Is a former Treasury 


father Isidore. 

Scotts is quoted on the Sing- 
apore stock exchange bnt is 
controlled by the Jnmabboy 
family, wbo at the time of the 
boy-ont agreement received 
assurances from the Kermans 
that they would leave the 
board. 

Iqbal Jumabhoy, Rafik 
Jnmabhoy and Bryan Burlet- 
son, a business partner of the 
Jmnabboys, have taken three 
seats on the board as non- 
exeentive directors. Sir Ian 
remains chairman. 

BS returned to the black this 
year for the first time since 
1988. with a pre-tax profit of 
£429,000 for the six months to 
June 30. The interim dividend 
of 3p was the first distribution 
since 1989. James Whittington 


adviser to Normant Lamont 
and author of Bricks & Mor- 
tals, a readable history of the 
last boom-to-bust property 
cycle. 

Yet he takes the helm of the 
IPF at a time when many of his 
peers are losing interest in 
property. The average pension 
hind now has only around 6 
per cent of its assets in com- 
mercial property, against 30 
per cent at the start of the 
1980s. 

Ross Goobey believes part of 
the answer could be new forms 
ctf property investment, which 
could mean another look at 
ways of tmitising property to 
appeal to fund managers. 
Simon London 

■ Michael Queen, a director of 
31, has joined the PRIVATE 
FINANCE PANEL executive 
on a 15-month secondment 


Jean Wood 
promoted at 
Irish Life 

Brian Duncan Is to step down 
as chief executive of Irish Life 
Ireland as part of the compa- 
ny’s reorganisation of its Euro- 
pean operations. 

Duncan, who joined the com- 
pany after leaving school, has 
been in charge of both retail 
and corporate arms. His depar- 
ture follows a merging of the 
company's retail business in 
Ireland and the UK under a 
new chief executive, Jean 
Wood, currently head of Irish 
Life’s European business. Cor- 
porate activities are to be 
headed by Kevin Murphy, cur- 
rently in charge of invest- 
ments. 

Irish Life’s managing direc- 
tor David Kingston says Dun- 
can, 49, believes “it is now time 
for a change - both for himself 
and for Irish Life”. 

Duncan declined to take one 
of the two new positions cre- 
ated by the management 
review and is now said to be 
favourite to take the vacant 
position of chief executive of 
VHI, the big state health 
insurer. John Murray-Broum 

■ Rick Hudson has been 
appointed operations director 
of ROYAL INSURANCE 
GlobaL 

■ Nigel Keess has been 
appointed director of 
operations with responsibility 
for the customer service and 
systems departments at 
SCOTTISH PROVIDENT 
INTERNATIONAL. 

■ James Gilchrist, deputy 
chief executive and general 
manager (sales), has been 
appointed to the board of 
SCOTTISH LIFE ASSURANCE 
COMPANY. 

■ Adrian Daly has been 
appointed chief executive of 
HIBERNIAN GROUP, Ireland’s 
largest home insurer, on the 
retirement of Eamon Walsh. 

■ Michael Pendle has been 
appointed director, general 
insurance at ABBEY 
NATIONAL; he joins from 
National & Provincial Building 
Society. 

■ David Drury, appointed 
information technology 
director, and Vyvienne Wade, 
legal director, have joined the 
boards of JIB UK Holdings and 
JIB Overseas Holdings: Drury 
moves from Bain Hogg. 

■ John Rampe, a director or 
UNITED FRIENDLY GROUP 
for 43 years, died last month. 




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FINANt .ALT, MBS THURSDAY NO 


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ARTS 


is 


FINANCIAL TIMES 


THURSDAY NOVEMBER 10 !'J*f 


★ 


I 


retired judge 
(Jean-Loms Trintignant) at 

of KrzySrf ffies, 

ft B iS? 1 S ^ ree Colours Red 

" “■ ^ 8 Portrait of the dire* 

Kieslowski is now a crusty retired 
gj^naker. Before unwrapping this 
ferew«SI movie at Cannes hstC? 
he announced that he was going 
into a hfe of chain-smoking leisure 
contemplation. Like Judge 
Trtntignant, he realises that truth? 
a deaerate thing to keep chasing: 
and that curiosity about human 
beings is not necessarily an h o ne s t 
virtue, just as often it may be or 
may become, a sleazy addiction.’ 

Trindgnant, deep in the book- 
lined villa where the film’s student/ 
fashion-model heroine (Irene Jacob) 
first finds him, after she h« s injured 
his Alsatian dog in a car collision, 
spends his days tapping into neigh- 
bours' phone calls. Like a movie- 
maker he Dirts with omniscience. 
He knows of the next-door hus- 
band’s guilt: "Sooner or later he’ll 
jump out of a window and his wife 
will know everything." He knows 
too about the blonde girl who is 
two-timing her young lawyer boy- 
friend, who happens to live near 
Jacob herself. 

A few scenes later, prompted by 
our heroine’s virtuous indignation. 
Judge Trintignant reveals his 
crimes to the cops and the newspa- 
pers. Enough with the hi-tech voy- 
eurism, he seems to say. And is 
Kieslowski saying the same? 

Three Colours Red rounds off the 
Polish film-maker's tricouleur tril- 
ogy with this essay on fraternity. 
The movie, like the Judge, often 
seems tired. Many of the metaphysi- 

t cal Kieslowski twitchings were dis- 
played to better effect in Bhie. 

This goes for the obsession with 
paral l el lives. Is Mile Jacob’s young 
lawyer neighbour mystically re-liv- 
ing Tr intignanf s fife, right down to 
exact reverberant incidents like the 
dropping of a pile of exam books in 
the street? It also goes for the direc- 
tor’s fondness for dais ex machtna 
wrap-ups. In Red we have a hid- 
eously gl?h ending in which a cross- 
channel ferry is sacrificed to bad 
weather so that six people can sur- 
vive to reveal themselves as - yes! 

- the key young characters from all 
three trilogy movies. This includes 
the young lawyer, at last buried by 
Fate into Jacob’s arms. 

Red begins as a movie about com- 
munication between people and 
generations. The opening sequence 
is a dazzlen camera snaking at high 
speed along phone cables as they 
plunge through earth and then 
under the sea. And thereafter the 
film's title colour is picked out in 
each seme, warmly, brilliantly, like 
a electronic beacon between strang- 
ers and ages. 

But midway through the film we 
start to get an empty, hungry feel- 
ing: Surely Kieslowski and regular 
co-writer Krzysztof Piesiewicz have 
forgotten something vital: to put 
real people into this story. Where 
past heroines - Juliette Binoche in 
‘j Blue, Irene Jacob in The Double Life 
Of Veronique - were tortured, 
touching souls grappling with the 
tragicomedy of everyday life, no one 
in Red lives and breathes except as 
illustrations to a thesis. That thesis 
is: Everything, for good and HI, con- 
nects. 

Trtntignant’s Judge is the sacred 
and profane ride of our Neighbour- 
hood Watch epoch: satanic. he 
snoops: God-like, he can confer 
happy endings. Jacob's leggy, open- 



A too, too neat last testament from Krzysztof Kieslowski: Irene Jacob in Three Colours Red* 

Cinema/Nigel Andrews 

At the end of the rainbow 


hearted model is a sort of Miss Per- 
fect Human Communion 1994. And 
the setting is Geneva, world capital 
of brokered harmony. In the Kies- 
lowski cannon the jagged realities 
and loose nerve-ends of Blue, and 
the song-without-end mysticism of 
Vertmique, have been put away for 
this too, too neat last testament 
Red shows that even lives that do 
not naturally connect can be forced 
into harmony by a little hi-tech hot- 
wiring mixed with supernatural 
benison. 


B ut every film Industry 
likes to compel human 
unions when it cannot 
germinate them natu- 
rally. Each Rim this 
week is a variant on that oldest 
coercive formula of all: Boy Meets 
Girl. 

- Nicholas Kazan’s Dream Lover is 
a directing debut by the screen- 
writer of Patty Bears! and Reversal 
Of Fortune. So we expect a few fris- 
sons amid the amatory fol-de-rol. 
Boy (James Spader) meets girl 
(Madchen Amick); then boy starts 
to wish he had not met girl when 
Amick shows signs of deceit, infi- 
delity and a hidden past. Boy ends 
up in a mental asylum hatching 
murder plots. 

While ambiguity thrives, the film 
has a wicked wit Kazan lets Spader 
get ever more lost amid the chic 


white spaces of his home and office 
- he is an architect (but ah irony, 
not of his own destiny) - while 
Amick 's dream-bride beauty 
becomes ever more sinisterly 
blanched and iconic. For 80 of its 
103 minutes, we are guessing, fret- 
ting and chewing the nearest set of 
fingernails. But the ending is a 
disaster a surrender to thriller 
cliche that should be stamped like a 
black spot on Kazan’s directing CV, 
to warn future employers. 

In Rory Kelly’s Sleep With Me, 
hoy (Eric Stoltz) meets girl (Meg 
Tilly); boy marries girl: boy then 
discovers that second boy (Craig 
Sheffer). his longtime friend, has 
raging passion for girL We move 
into a Jules and Jim syndrome. Cal- 
ifomia-style, in which kooky trian- 
gular fun alternates with moments 
of semi-murderous intent 

Six scriptwriters, including Neal 
Jimenez (River’s Edge ) and Roger 
Heddon ( Bodies. Rest And Motion), 
each worked at different story sec- 
tions: which explains why the film 
feels like a game of consequences 
played out by the students of a cre- 
ative writing class. Some innocent- 
seeming scenes are sharp as a 
paper’s edge. Others, notably the 
rambling "confessions" to video 
camera during a long barbecue 
sequence, are as blunt as yester- 
day’s writing ideas that you balled 
up and threw into the WPB. 


THREE COLOURS RED (15) 

Krzysztof Kieslowski 

DREAM LOVER (18) 

Nicholas Kazan 

SLEEP WITH ME (18) 

Rory Kelly 

FLESH AND BONE (15) 

Steve Kloves 

IT COULD HAPPEN TO 
YOU (PG) 

Andrew Bergman 

Do watch, though, for a funny 
cameo by Quentin Tarantino as a 
party guest deconstructing Top Gun 
as a gay fable. 

As for Flesh And Bone, what ever 
high-concept story conference pro- 
duced this? Boy (Dennis Quaid) 
meets girl (Meg Ryan). Boy, we 
learn, is the grown-up ex-accom- 
plice of a violent burglar father 
(James Caan) who shot to death the 
girl's family when she was a baby. 
So the stage is set - or the flat, 
moody, infinite Texas landscape - 
for a flat, moody, infinite film. The 
slow incubation of revenge shares 
screen time with the grimly inert 


"lerve" story at the centre. 

It feels like a bad O’Neill play 
staged by a community theatre 
company: one of those outdoor 
productions where the audience has 
to keep moving its chairs around. 
Now we are watching everyday 
small-town life as it is clumped 
through by Quaid, a man of few 
words and none of them interesting. 
Now we are out in the cornfields 
with Ryan, wondering why the 
talented star of Sleepless In Seattle 
took on this rewardless, one-note 
role. Ah, yes; of course. She is 
married to Quaid. 

Dynastic connections are 
important in Hollywood. It Could 
Happen To You is a romantic 
comedy starring Nicolas Cage, 
nephew of Francis Coppola, and 
Bridget Fonda, daughter of Peter, 
and directed by Andrew Bergman, 
son of In gmar if only. 

In gmar should have taken over 
this film and given it teeth and 
mania. Boy (policeman) meets girl 
(waitress). Boy. in lieu of tip. 
promises girl half whatever he wins 
on a lottery ticket Boy wins lottery. 
Boy wins girl. Boy’s wife (Rosie 
Perez) promptly goes berserk, 
which provides the only comedy in 
a film so thick with anodyne, 
lolloping romance that by the end 
we are crying out for one of those 
murders so generously on offer in 
the week’s other movies. 


O n Tuesday, thanks to a 
London Symphony 
commission made 
possible by Sir Jack and 
Lady Lyons, we heard Mstislav 
Rostropovich in the world premiere 
of a cello concerto, a "Sotto voce 
concerto". The composer Rodion 
Shchedrin, now 62, is (slightly) 
known in.tbJs country for his ballet 
The Little Humpbacked Horse and 
foe his ballet-adaptation of Carmen 
- not sotto voce music at alL His 
new concerto has been brewed in 
quite a different samovar. 

, It is whispery, nostalgic, 
.^evocative; mid highly personal, in 


Concert/David Murray 


Rostropovich plays Shchedrin 


the double sense of intimating 
things close to the composer’s 
heart, and of being specifically 
conceived for Rostropovich's rare 
powers. The solo instrument is 
rarely silent, but mostly muted, 
even in the huge cadenza that 
leads to the Finale. The full 
orchestra is used very sparingly: 
the most prominent sounds are 
those of three soft, intertwined 


flutes - and of all the other cellos, 
generally dwisi. 

A solo recorder lends a pastoral 
note, for Shchedrin is thinking or 
his childhood in "the sleepy tiny 
little place of Alexin on the Oka", in 
Tolstoy country. Most of the 
material suggests shepherds' songs 
and peasant rounds, mused and 
rhapsodised over by the cello with 
spectral orchestral echoes. Toward 


the end. quite unexpectedly, the 
heavy brass come to angry life with 
rat-a-tat fanfares: war gripping the 
countryside, perhaps? 

Rostropovich wrung "meaning" 
from every phrase, of course, and 
we listened compulsively. But 
despite the best efforts of the 
conductor Seiji Ozawa, the score 
sounded awkwardly diffuse for a 
37-minute piece: amid so many 


elusive sounds and colours, we 
needed more palpable structure, 
less stop-go. Probably Russian 
ears can fasten more quickly upon 
the ghosts of traditional tunes, 
and maybe discern a development 
that remained opaque to the rest of 
us. 

As a matter of fact the largest 
faction in the audience was 
Japanese, drawn presumably by 
Ozawa. He conducted a scrupulous 
Beethoven “Pastoral" too. tame in 
the peasants’ Scherzo but limpid by 
the stream: pleasant, unmemorable. 

Sponsored by Yamaiehi 


Theatre in London 

Alice’s Adventures 
Under Ground 


B aik we go into the nurs- 
ery, into the place where 
we now analyse childhood 
enchantments in context 
of disenchanted knowledge of adult 
life. Can there be one simple reac- 
tion to Alice's Adventures Under 
Ground. Christopher Hampton’s 
new adaptation of Lewis Carroll's 
writings and aspects of bis (i.e. 
Charts Dodgson's) life? On the one 
hand, since this Alice is full of epi- 
sodes from those classic hooks, it is 
a bracing dip back into a sane 
Child’s discovery Of the nnn<a»n«dral 

grown-up world- On the other hand, 
it is a disturbing study of the stam- 
mering, polite, scholariy Dodgson’s 
melancholy fascination with little 
girls. 

Hampton means, I take it, to 
examine Carroll’s creativity in 
terms of what Edmund Wilson 

called “the wound and the bow": 
the wound, in this case, being Dodg- 
son’s paedophile inclinations, the 
bow being the tales he told to his 
listeners. The wound/bow theory 
proposes that the spot where some 
artists are psychologically vulnera- 
ble is precisely what gives them 
their creative genius. In Martha 
Clarke’s staging; there are only five 
actors, and the overlap between lit- 
tle Alice Liddell’s real world and 
the dream world that Dodgson cre- 
ates for her is considerable. 

Hampton’s view of Dodgson/Car- 
roll is compassionate - too much 
so. The bow only interests him as 
for as it reveals the wound, and 
many of the books’ multi-faceted 
quotations are so placed that we 
read them in terms cf Dodgson's 
private feelings. "Seven and a half! 


Uncomfortable sort of age. If you'd 
asked my advice, you’d have left off 
at seven.” We also watch Dodgson 
start to cry as he slowly unbuttons 
little Alice's dress. 

But Carroll’s own mind, for all its 
pathos, is weak tea beside the intox- 
icating concoctions of his talas. 
Though Alice’s Adventures Under 
Ground is sensitively shaped, its 
eventual thrust is merely sentimen- 
tal. And sentimentality, surely, is 
wrong for the man who made Alice 
cry out "You're nothing but a pack 
of cards!" 

Robert Israel’s nursery set is elo- 
quent: one look at its rocking-horse, 
its white walls, its large dark 
looking-glass above the mantel, and 
we are prepared for meanings both 
surreal and psychological. John 
Carlisle, Gabrielle Lloyd, and 
Joseph Mydell play a marvellous 
range of supporting roles. Martha 
Clarke has them act with a fine 
dash of exaggerated intensity. 

Sasha Hanau would be an ideal 
Alice - grave, focused, precise, 
responsive - if she did not gabble 
rapid lines. Michael Maloney 
(despite overdoses erf vocal virtuos- 
ity) beautifully creates a Car- 
roll/Dodgson of immense courtesy, 
birdlike staccato head movements, 
and eyes both burning and plead- 
ing. He is adult among children, 
child among adults. Judiciously, 
Hampton and Clarke have him play 
his own Dormouse. 

Alastair Macaulay 


In repertory at the Cottesloe Thea- 
tre, South Bank, into 1995. 


'Romeo 7 from Tel Aviv 


T he large sculpted horse 
that is the only prop in 
Rina Yw iwhalmi ’s produc- 
tion of Romeo and Juliet 
looks rather startled - as well he 
might As a symbol of escape, he is 
to carry the burden of the tragedy 
on his back: Romeo and Juliet meet 
on hhn , act out the balcony scene 
on Mm and rfing to him desper- 
ately as things go wrong. It is a 
simple device, yet a surprisingly 
eloquent one, and typical of this 
beguiling production from Tel Aviv. 

This, the second Romeo and Juliet 
in the Everybody’s Shakespeare sea- 
son at the Barbican, is very differ- 
ent from the stark German produc- 
tion that launched the festival last 
week Where the German produc- 
tion on the main stage was long and 
large scale, the Israeli one, staged in 
the Pit, is intima te and condensed; 
where that production focused on 
the confrontation in the play at the 
expense of the romance, this one 
emphasises the thane of love, at 
some cost to the violence; and 
where the first one created a bleak 
and harsh world, the second is soft, 
beautiful and sometimes bewil- 
dering. 

The mood of the piece even seeps 
out into ftp foyer. As the audience 
collect their tickets, a pair of 
masked lovers wander among them, 
looking rather lost. Inside, half- 
masked actors in black cloaks pad 
about the auditorium, smiling tan- 
talisingly at the audience and 
addressing them, somewhat mysti- 
fyingly. in Hebrew. Soft music and 
subtle lighting sufflise the theatre 
in the languorous atmosphere that 
will permeate the production. 

Yerushalmi's intent, as she 
explains in the programme, is to 
use the language of theatre to cap- 
ture the intoxicating feeling of 
being in love. She builds to some 
extent on commedia dell 'arte, which 
helps to establish the mischievous, 
inventive mood of her production. 
The actors, dressed as a group of 


strolling players, are inspired by 
the Chorus to perform the play and 
act out the opening brawl in playful 
spirit As they and the audience are 
sucked into the story, however, the 
mood changes. 

Once Romeo and Juliet have met, 
the play is compressed to the main 
moments. The central Romeo and 
Juliet remain on stage while other 
members of the cast speak their 
lines or perform their actions. This 
suggests the engulfing nature of 
love and its ability to distort percep- 
tion. It works wonderfully in places. 
As tiie couple part after their night 
together, the main Romeo and Jul- 
iet stand wrapped around each 
other in mute adoration, while 
another couple speak their 
thoughts. And when Juliet visits 
Friar Laurence for the potion that 
will put her to sleep, four actresses 
creep around the stage in the flick- 
ering light, each totally wrapped up 
in her task. This may sound bizarre, 
but on stage it works, emphasising 
both the universality and the loneli- 
ness of passion. 

There is a price to be paid for this 
conceit Sometimes it is con Rising , 
sometimes it just seems tricksy and 
throughout it sacrifices the continu- 
ity of character that would help you 
empathise with Romeo and Juliet 
and experience their tragedy. The 
production also gives little hint of 
danger - the fight between Tybalt 
and Mercuric is a rather stagey 
affair. But there are same purdy 
enchanting moments - to portray 
the ball, for instance, toe actors 
simply file softly onto the stage car- 
rying sparklers and surround Juliet 
in flickering light - and toe whole 
production is performed with such 
charm, Hit and gentleness by the 
Itim Theatre Ensemble that it is 
hard to resist. 

Sarah Hemming 


Continues to November 12 at the 
Pit (071 638 8891). 



■Athens.-.. 

Mogarontonlght, Sat staged 
production of Poqfenc’s La voix 
humaine, starring Joanne Pflbu. Sun: 
first of five guest performances by 
Bolshoi Baflet-Nov 19: SharriB 
■Mihes song recited.- Nov- 21: 

Francois Le Roux (01-728 2333/ 
01-722 5511) ■ 


■ BOLOGNA X 

Teatro Communale More Roberto 
Corrfinali piano recital Next Wad • 
(Pafe2zq del Congress): Lindsay 
KAffgfcrtfl nfiB . programme. The opera 

. sadsoh opens on Nov 26 with a new 
1 1 produi^ofRbssiw^ltturcoln- 

‘ Itatiafito telephone bookings. : 
lntorralloiv : 051-529999) : - . 


■ GENOA v:' >. 

Teatro Carlo Fefice tomorrow, Set 
afternoon: Yoram David conducts 
works tor Shostakovich and Dvorak, 
with cello soloist Mtecha Maisky- 
The opera season opens on Doc 2 


with Dor ffiegende Hollander (No 
telephone bookings. Information: 
010-589329/010-5381 225) 


■ LONDON 

THEATRE 

• True West Matthew Warcus 
directs Barn Shepard’s drama about 
two battling brothers in the Mid 
west Opens tonight for a 
three-week run (Donmar Warehouse 
071-369 1732) 

• The Tale of Lear Suzuki 
Company of Toga presents its 
Japanese version of King Lear 
tonight, tomorrow and Sat, as part 
of an international Shakespeare 
season. Nov 16-19: Peter Selims’ 
Chicago production of The Merchant 
of Venice transports the play to 
Venice, California, a turbulent 
melting pot of racial diversity 

■(Barbican 071-638 8891) 

• Hamlet the Globe Theatre has 
re-opened as the Gielgud with Peter 
Hall’s new production of Hamlet, 
starring Stephen Dfliane, Michael 
Pennington, Donald Snden. Gwen • 
Taylor and Gina Bellman (Gielgud 
071^94 5065) 

*' Three TaB Women: Edward 
Afbee’s crihredy-acefamed PuRtzer 
Award-winning play stars Maggie 
Smithy Frances de la Tour and 
Anastasia Hille, directed by Anthony 
Page. Now in previews, open? Nov 
15 (Wyndham's 071 -369 1736) 

•. The Prime of Miss Jean Brodie: 

' Patricia Hodge lakes cm the rote of 
the formidable schoolteacher whose 
mix of romance and wfiftifness . 

- inspires her pupils (Strand 071-930 
6800) 

• A Passionate Woman: Ned' 
Sherrtn directs a new production of 
Kay Mel tor’s play, first seen at foe 


West Yorkshire Playhouse last year. 
Stephanie Cole stars as the 
housewife whose passion for life 
breaks out to the honor of her 
family- Just opened (Comedy 
071-369 1731) 

• Moscow Stations: a one-person 
play, starring Tom Courtenay, 
inspired by Venedikt Yerofeev's 
acclaimed modem Russian tale 
about an alcoholic who stumbles 
and dozes his way through a series 
of surreal adventures (Garrick 

071 -494 5065) 

• The Seagull: Judi Dench's 
Arkadi na heads a splendid cast in 
Pam Gems' new version of 
Chekhov's play about disappointed 
aspirations. In repertory at the 
National with The Devil’s Disciple, 
Bernard Shaw's 1897 satire on 
melodrama, and Racing Demon, 
David Hare’s play about tensions in 
the contemporary Anglican Church 
(National, Olivier 071-928 225 2) 

• She Loves Me: the charming 
1963 Masteroff, Bock and H amick 
musical about two longtime pen pals 
who don’t know they work In the 
same parfumerte. Ruthie Henshall 
and John Gordon Sinclair head the 
cast (Savoy 071-836 8688) 

OPERA/DANCE 

Co vent Garden The Royal Ballet 
gives the first performance tonight of 
its Ashton celebration, including a 
new production of Daphnis et Chioe 
designed by Martyr Bainb ridge and 
conducted by Bernard Haitink 
(repeated Nov 11, 14, 16, 21. 28, 

30). Anthony Dowell's new staging 
of Sleeping Beauty can be seen on 
Nov 18, 19, 23 and 26, with further 
performances in December. The 
Royal Opera has Borneo et Juliette, 
staged by Nicolas Joel and 


conducted by Charles Mackerras, 
with cast led by Roberto Alagna and 
Leonti na Vaduva (Nov 12, 15, 17). A 
new production of La traviata opens 
on Nov 25 (071-304 4000) 

Coliseum English National Opera’s 
current repertory consists of Ariadne 
auf Naxos starring Jare Eaglen, and 
Nicholas Hytner's staging of Die 
Zauberfl dte. The next new 
production is Khovanshchina, 
opening Nov 24 (071-836 3161) 
Sadler’s Wefls Northern Ballet 
Theatre presents Christopher 
Gable’s touring production of 
Cinderella, music by Philip Feeney. 
Daily except Sun till Nov 19 
(071-278 8916) 

CONCERTS 

South Bank Centre Tonight Sun: 
Nikolaus Harnoncourt and the 
Philharmonia Orchestra bring their 
cycle of Beethoven symphonies to a 
conclusion. Tomorrow: Yuri 
Temirkanov conducts RPO in works 
by Berlioz, Rakhmaninov and Grieg, 
with piano soloist Nikolai 
Demidertko. Tomorrow (QEH): 
Birmingham Contemporary Music 
Group presents Stockhausen's 
Momenta. Sat, Mon: Maurizio Poilini 
plays the Schumann Piano Concerto 
with the London Philharmonic. Sun 
(QEH): Chelsea Opera Group 
presents concert performance of 
Smetana’s The Brand en burgers in 
Bohemia Tues: Igor Olstrakh plays 
the Tchaikovsky Violin Concerto with 
the Bmo State Philharmonic 
Orchestra. Tues (QEH): Academy of 
St Martin in the Fields plays baroque 
music. Wed: Bulgarian State Female 
Choir. Wed (QEH): Bkie Brooks. 

Wed (Purcell Room): Leontyne Price 
introduces recordings and films of 
her career (071-928 8800) 


Barbican Tomorrow: Markus Stenz 
conducts London Sinfonietta in the 
first of a series of Schnittke 
concerts. Sun, next Tues: Mstislav 
Rostropovich, Yuri Bashmet and 
Gidon Kremer join London 
Symphony Orchestra in an 
all-Schnittke programme (071 -638 
8891) 


■ MADRID 
Teatro Lh-fco La Zarzuela A 
zarzuela double-bill, consisting of 
Tomas Breton’s La Verbena de la 
Paloma and Federico Chueca’s 0 
Bateo, opens on Sat for a 
three-week run (01-429 8225) 


■ MILAN 

THEATRE 

The third European Theatre Festival 
takes place between November 16 
and December 18. It opens with Bob 
Wilson’s Paris production of Virginia 
Woolfs Orlando. The Piccolo Teatro 
presents a new Strehier production 
of Marivaux’s The Island of Stoves. 
The UK is represented by the Royal 
Shakespeare Company (Henry VI 
directed by Katie Mitchell) and the 
National Theatre (Christopher 
Hampton’s new Lewis Carroll 
adaptation, Alice's Adventures 
Under Ground, directed by Martha 
Clarke). Other visitors Include 
companies from Berlin. Stockholm, 
Barcelona, Cracow. St Petersburg, 
Budapest and Bucharest 
(02-861897) 

LA SC ALA 

Tonight: Kenneth MacMillan’s 
Manon. Nov 14, 16, 17: Riccardo 
Muti conducts the Scala orchestra in 
a Mozart programme, with piano 
soloist Murray Perahia. Nov 21 : 


Teresa Berganza Dec 7: opera 
season opens with Die WalkQre 
(02-7200 3744) 


■ PRAGUE 

Rudotfinum Tonight, tomorrow: Jiri 
Befohlavek conducts Czech 
Philharmonic Orchestra in works by 
Ravel. Hummel and Hindemith, with 
bassoon soloist Frantisek Hetman. 
Tues: Bohemia Saxophone Quartet. 
Next Wed: Czech Chamber 
Orchestra plays works by Martinu, 
Reicha, Dvorak and Janacek, with 
cello soloist Mikael Ericsson 
(02-2489 3352) 


■ ROME 

Vladimir Spivakov conducts the 
Orchestra defl’Accademla Nazionale 
di Santa Cecilia on Sat, Sun, Mon 
and Tues to a programme of Vivaldi 
flute and violin concertos. The 
orchestra's programme in the 
pre-Christmas period features Arturo 
Bonucci and Cecilia Gascfia as 
soloists, and conductors Christiai 
Thielemann, Gennady 
Rozhdestvensky and Carlo Maria 
Giulini. All concerts lake place at the 
Auditorlo di Via della Condliaztone 
(06-6880 1044) 


■ TURIN 

Teatro Reglo A new production of 
Donizetti's La fills du regiment 
opens next Tues, conducted by 
Bruno Campanula, staged by Luca 
Ronconi and sung in French by a 
cast including Eva Mel/Laura 
Claycomb and Giuseppe Sabbatinl/ 
Jorge Lopez Yanez. Repeated Nov 
18. 20. 22, 23. 24. 26, 27, 29, 30 
(011-8815 241) 


ARTS GUIDE 

Monday: Berlin, New York aid 
Paris. 

Tuesday: Austria, Belgium, 
Netherlands, Switzerland, Chi- 
cago. Washington. 
Wednesday: France, Ger- 
many, Scancfinavia. 

Thursday: Italy, Spain, Athens. 
London, Prague. 

Friday: Exhibitions Guide. 

European Cable and 
Satellite Business TV 

(Central European Time) 
MONDAY TO FRIDAY 
NBC/Sqper Chamak FT Busi- 
ness Today 1330; FT Business 
Tonight 1730, 2230 

MONDAY 

NBC/Super Channel: FT 
Reports 1230. 

TUESDAY 

Euronews: FT Reports 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; 





/ 


I. 


r. times THURSDAY NOVEMBER. »0t*>4 


Trapped in a 
protectionist world 


E urope's airline barons 
are putting up a Tight. 

The loss-making flag 

carriers, and the states 
that own them, are proving as 
determined to protect them- 
selves from market forces as 
the European Commission is to 
unravel the closed and subsi- 
dised airline industry. 

The result is a game of ploy 
and counterploy, as govern- 
ments try to delay the intro- 
duction of competition and 
extend the life and amount of 
state subsidies, ahead of the 
complete opening or European 
skies in 1997. 

The Commission launched 
its three-stage liberalisation 
policy in 1986. forcing Euro- 
pean governments to abandon 
the heavy regulation that had 
protected their carriers from 
competition, but kept many air 
hues artificially high. 

When deregulation is com- 
pleted in three years time, all 
EU airlines will be able to fly 
wherever they choose within 
the single European market, 
and operate internal services 
in other EU countries. The 
Commission is also proposing 
to break up the ground han- 
dling monopolies at many 
European airports. 

For the Commission, the 
challenge has been to resist 
pressure from governments to 
approve large subsidies tor ail- 
ing national carriers to help 
them cope with liberalisation. 
The Commission agreed this 
year that financially troubled 
flag carriers should be allowed 
one last injection of state funds 
only where it was tied to a 
meaningful restructuring pro- 
gramme. 

But Brussels since appears to 
have capitulated to the big 
state carriers and their govern- 
ment owners. In July alone, 
the Co mmiss ion approved state 
aid totalling $7.1bn to three air- 
lines including Air France, 
TAP of Portugal and Olympic 
Airways of Greece. These aids 
were equivalent to 45 per cent 
of the total losses of S15.6bn 
that western airlines have 
accumulated on their interna- 
tional scheduled services in the 
past four years. 

Seven airlines - British Air- 
ways, KLM, SAS. Air UK. 
Maersk, TAT and British Mid- 
land - and the British govern- 
ment are now contesting the 
Commission's approval of a 
FFr20bn state aid package for 
Air France. The subsidy is 
"grotesque", says Sir Michael 
Bishop, the British Midland 
chairman, “it is almost equal 
to the entire losses made by 
world airlines last year”. 

But subsidies are not the 
only source of friction. There 
has been a bush war in France 


The world is 
seeing a new 
I f ' ; \ breed of pluto- 
/ -I-'" \ populist. Men 

..ljIeSlL. of vast wealth 
JgsgliP ■ don the mantle 

Book of ° utsWers 
review 

the little people. In the US, 
there is Ross Perot In Italy, 
there is Silvio Berlusconi. Now 
there is the Anglo-French Sir 
James Goldsmith, recently 
elected to the European parlia- 
ment on an anti-Maastricht 
and anti-Gatt platform. 

Sir James Is not just a tal- 
ented businessman who has 
accumulated a fortune. He sees 
himself as a philosopher. 
“Global free trade, intensive 
agriculture and nuclear 
energy” are, along with the 
modern welfare state and 
Maastricht Europe, the n v» n 
targets of his assault. This 
unholy trinity has “profoundly 
destroyed our social stability". 
They are also “pure products 
of the enlightenment and as 
such are venerated by modern 
conventional wisdom", the lat- 
ter synonymous, for Sir James, 
with error. 

The book takes the form of 
conversations with Yves Mes- 
sarovitch, editor of the eco- 
nomics section of Le Figaro 
newspaper. Messarovitcb asks 
bland questions. In return. Sir 
James pours forth a torrent of 
opinions. He is against the 
Gatt, intensive agriculture, 
nuclear power, the universal 
welfare state, the Maastricht 
treaty, the technocratic 
“nomenklatura" that runs 
Europe, science "separated 
from the ethical and the spiri- 
tual”, and the enlightenment. 

He is in favour of “families, 
communities, cultures and tra- 
ditions": regional free trade 
among countries that “are rea- 
sonably similar in terms of 
development and wage struc- 
tures'’, with “mutually benefi- 
cial” bilateral agreements 
between them; a Europe of 
nations; a common (but not 
single) European currency; a 
social safety net; and participa- 
tory democracy. 

It is tempting to dismiss all 
this as the vapours of a self- 
publicising crank. That would 
be a mistake. These views mat- 
ter first, because they articu- 
late a perfectly understandable 
dismay at the modem world; 


THE TRAP 
By James Goldsmith 

Macmillan, £7.99. 214 pages 


second, because a bit of what 
he says makes sense; third, 
because he also offers danger- 
ous solutions that may attract 
an army of adherents; and, 
finally, because he has the 
means to ensure his ideas will 
not go away. 

Take his assault on free 
trade. Sir James argues that 
“the damage [Gatt] will inflict 
on the communities of both the 
developed world and the third 
world will be intolerable”. For 
the former, the peril is mass 
unemployment as “4bn people 
enter the same world market 
for labour and offer their work 
at a fraction of the price paid 
to people in the developed 
world”. But, be argues, “the 
application of Gatt will also 
cause a great tragedy in the 
third world”. 

Yet the main cause of unem- 
ployment in industrial coun- 
tries Is not trade with tbe 
developing ones. Such trade 
has merely added som ethin g - 
there is no agreement how 
much - to the pressures cre- 
ated by technology upon a 
rigid labour market It is also 
untrue that labour costs are 
decisive in determining com- 
petitiveness. Differences in 
labour costs reflect differences 
in average productivity 
between countries. Nor are 
these differences surprising; 
Investment per person In Ger- 
many, for example, is 25 times 
as large as in China, which is 
why Chinese labour is cheap. 

Protection, even of labour- 
intensive manufacturing, is a 
grotesquely inefficient means 
of promoting employment. 
What is too rarely understood 
- it is not by Sir James - is 
that a tax on imports also 
taxes exports. Import-compet- 
ing industry would expand, but 
export industry would shrink. 
Even in import-competing 
industry, labour-replacing 
investment would continue 
and the tendency towards a 
steady decline in the jobs sup- 
plied by manufacturing would 
in no way abate. This depends 
on the growth in demand for 
manufactures, on the one 
hand, and productivity 
increases, on the other. 


Above all. if we are con- 
cerned about unemployment 
and the distribution of the 
gains from growth, the best 
and most politically honest pol- 
icy is direct, rather than indi- 
rect, assistance to tbe workers. 
The combination of greatly 
improved education and train- 
ing, generous employment sub- 
sidies and income transfers is 
both the best and the right pol- 
icy. It Is superior to protection, 
except politically. 

More surprising than argu- 
ments for protection in indus- 
trial countries is the view that 
free trade threatens the third 
world, too. “It is the elites who 
are in favour of global free 
trade. It is they who will be 
enriched," asserts Sir James. 
So the industrial countries can 
pull up the drawbridge against 
third world exports In the com- 
fortable knowledge that it is, 
thereby, doing the poor good. 

Countries ail over the former 
third world have become more 
liberal and more outward- 
looking in their trade policies. 
The obvious question is why. 
The answer is that they have 
tried the very policies recom- 
mended by Sir James, with 
disastrous results. The only 
path of development that bas 
worked has been specialisation 
on the basis of comparative 
advantage, particularly when 
that advantage is In labour- 
intensive manufactures. 

The Industrial world has not, 
as Sir James insists, imposed 
its model on a reluctant third 
world full of happy peasants. 
Nothing stops a country from 
closing itself off: C hina tried; 
Burma is still trying. The rea- 
son these attempts have failed 
is that the vast majority of 
men and women want the pros- 
perity the west offers. In fact, 
they want a tiny fraction of 
what Sir James already has. 

Sir James alleges westerners 
believe “any community which 
resists the absorption or 
destruction of its culture by 
the west is a threat to peace” 

1, for one. do not. What is 
indeed a threat to peace is the 
view that the industrial coun- 
tries are entitled to deprive bil- 
lions of people around the 
world of the mutually benefi- 
cial trade that Is their best 
hope for some prosperity. 


Martin Wolf 


Chase congratulates the British Museum 
on the launch of its 


250th Anniversary Development Programme 


Struggle at the 


airport gates 


Paul Betts on the row over state aid for airlines 3head 
of the complete opening of Europe's skies in 


over the opening to competi- 
tion of Orly airport, south of 
Paris. 

The French transport minis- 
try, last month, limited the 
total number of take-offs and 
landings from the airport, 
which is a stronghold of Air 
France and its domestic part- 
ner airline. Air Inter, to the 
current level of 200,000 flights 
a year, on environmental 
grounds. Many in the industry 
suspected the motive was to 
prevent any rapid expansion of 
competition at Orly. 

The European Court of Jus- 
tice recently ordered the 
French government to allow 
other airlines immediate 
access to the lucrative domes- 
tic routes to Toulouse and Mar- 
seilles that have long been the 
monopoly of Air Inter. The 
transport ministry responded 
by announcing that competing 
services could only start in 
January. 

In June, the French govern- 
ment was forced to grant 
rights to British Airways and 
its French affiliate, TAT. to 
start flying between Orly and 
London. This dispute almost 
blew up into an all-out confron- 
tation with the British govern- 
ment and the European Com- 
mission. And even after 
reluctantly agreeing to the 
Orly flights to London, the 
French government imposed a 
cap of Tour daily services on 
the route. 

Undeterred by these set- 
backs, the government this 
month frustrated KLM’s plans 
to start services between 
Amsterdam and Orly by refus- 
ing to grant the Dutch carrier 
landing rights, prompting KLM 
to ask the European Commis- 
sion to intervene. 

The French transport minis- 
try says its aim is to achieve 
fair and healthy competition, 
but concedes that competition 
on these routes would cut Air 
Inter's market share and 
aggravate losses at the 
airline. 

Last month. Air Inter 
warned of expected losses of 
about FFrlOOm this year. Its 
partner. Air France, is engaged 
in a restructuring plan to cut 
losses of FFr85bn last year and 



log, air .transport Is on the 
upswing, and most big afxttses 
are finally making money, a 
hard core ..of . state-owned 
majors- appear unable to take 
any medidne at .alt” notes Mr 
De Croo. ... 

The -danger . Is that a. two- 
class airline industry will 
emerge in “Eurqpe. ‘The first 
involves airlines which Jiave 
had to solve ifcefr ptohlems m 
their own: the second Includes 
airlines which continue to .defy 
the laws of economics: and 
have enjoyed a bumper- year 
for subsidies," says Mr Robert 
Ayling, waT1 ^g l "g. director of 
British Airways. For the .BA 
executive, : state ..aid is^a .test . . 
that the Commission has so far 
“dramatically failed and done 
lasting damage to its reputa- 
tion” . ••= i . .... 


A Cranfleld University, 
study oh airline.: effi- 
ciency confirms that, 
privately or partially 
privately, owned carriers' are 
performing best in : Europe 
while state-owned carriara . are 
at the bottom of the faague. In 
his legal challenge against the 
Air France subsidy, Mr Brian 
Mawhinney, the UK transport 
secretary, emphasised that 
government handouts removed 
the incentive for state-owned 
airlines to become efficient and 
adopt a sound commercial 
approach., •• 

Even If the European -Court 
action does not succeed in 
overturning the Commission’s 
approval of the Air France sub- 
sidy, it has unsettled .the regu- 
lators. “If nothing else, this, 
legal challenge is likely to 
stiffen the Commission’s spine 
and toughen its attitude over 
future applications for state 
aid,” one Brussels official said. 

The consumer is also emerg- 
ing as a force for change In 
European air travel. “We used 
to think that liberalisation 
would create the environment 
to change,” said one airline 
executive . “We now. believe 
the customer will The cus- 
tomer has less loyalty to. flag- 
carriers than governments 
have." 

And despite the last ditch 
resistance from the barons, the 
industry does seem, finally, to 
be getting the message. As Mr 
Pierre Jeanniot, the director 
general of the International Air 
Transport Association (IATA), 
told last week’s animal meet- 
ing of the 222 mem ber airline 
trade organisation: “The need 
for profitability is paramount 
Without it air transport will 
either die, as did maritime pas- 
senger transport, or become a 
political football in a game of 
subsidies, as with the rail- 
ways." 


return the group to profit by 
1997. 

“The problem is not techni- 
cal, but political, in the sense 
that every French minister of 
transport has for so long con- 
sidered himself the minister of 
Air France," said Mr Lofti. Bel- 
hassine, president of the small 
French independent carrier Air 
Liberty “The French govern- 
ment has no right to impose 
additional hardship on its citi- 
zens by avoiding competition, 
which is here to stay. There is 
still a feudal system in France, 
but the writing is now on the 
walL” 

The stakes are high not just 
for Air France and other state- 
owned carriers, but also for the 
European Commission and its 
efforts to liberalise European 
air transport 

There has been a rush of alli- 


ances and partnerships 
between large and small carri- 
ers in Europe to strengthen 
their hand in a deregulated 
market. But many govern- 
ments are proving reluctant to 
give up sovereignty over their 
airspace while they are fund- 
ing Inefficient national carri- 
ers, which are important 
sources of employment and 
political patronage. 

In addition, government sub- 
sidies to European national 
carriers are running at $L0m a 
day, according to Mr Herman 
De Croo, chairman of the Euro- 
pean Commission's indepen- 
dent committee of “wise men". 
Set up last year, the commit- 
tee’s brief is to draw up recom- 
mendations on the future of 
tbe European airline industry. 
“The tragedy of it an is that 
when the economy, is improv- 



LETTERS TO THE EDITOR 


Number One Southwark Bridge, London SE1 9HL 

Fax 071 873 5938. Letters transmitted should be cleady typed and not hand written. Please set fax for finest resolution 


Whole new i Quest for monetary credibility 


meaning m 
Peter Pan 


From MrHL Benjamin. 

Sir, Reading the arts and 
entertainment pages of the FT 
these days is to enter a whole 
new world. 

As a child, I was taken regu- 
larly around Christmas time to 
see the play of Peter Pan, 
which was a wonderful after- 
noon of escapism for us afl. 

Of how much more it had to 
offer I have only now been 
made aware. The hook of the 
pirate captain was a phallic 
symbol, says Jackie Wullschla- 
ger (Arts: “The truth behind 
Wonderland”, October 31). No 
mention Is made of the Red 
Indians, but they each had a 
tomahawk, did they not? Later, 
I was taken to see Treasure 
Island, which I equally 
enjoyed, completely missing, I 
suppose, the significance of 
Long John Silver’s wooden leg. 

Once one catches on to tbe 
idea, one’s horizons are limit- 
less. Contemplate the skyline 
of any modem city; the mind 
boggles at Canary Wharf! 

H L Benjamin, 

22 Shrewsbury House, 

Cheyne Walk, 

London SW3 


From Mr Daniel P McLaughlin. 

Sir, The Bank of England 
appears to have greater weight 
in the setting of interest rates, 
a change designed to enhance 
the “credibility” of monetary 
policy in the UK (“Bank 
reports improved outlook on 
foliation", November 2). The 
search for "credibility" also 
extends to the idea of a “pre- 
emptive” rate rise, designed to 
tighten policy at an early stage 
in the Inflation cycle. 

Ultimately, the success of 
the new policy regime will be 
judged by the path of inflation 
over the next few years, but 
one can also form an immedi- 
ate impression by examining 
any change to inflation expec- 


tations wrought by the regime 
shift. 

Fortunately, a good proxy 
for expectations of fixture UK 
inflation is at hand, in the 
yield difference between nomi- 
nal bond yields and the real 
yield as paid on index-linked 
stocks. 

Unfortunately, the evidence 
to date suggests the market 
has yet to be convinced that 
inflation is well and truly 
under controL The inflation 
rate implied by the current 
yield spread between index- 
linked and nominal bond 
yields is some 4.65 per cent, 
against 3.50 per cent in Janu- 
ary. Moreover, this implied 
expectation is no different 


now from what it was on 
September 12 (the date of 
the first “preemptive" tighten- 
ing). 

Perhaps most worrisome of 
all for the Bank of England Is 
that the level of inflation 
expectations is virtually twice 
that of its own forecast of 2J5 
per cent. Presumably, true 
“credibility" will have been 
achieved when the two fore- 
casts coincide, ideally with the 
market expectation falling to 
meet that of the Bank. 

Daniel P McLaughlin, 
head of fixed interest, 

Riada Stockbrokers, 

1 College Green, 

Dublin 2. 

Ireland 


tv 

V- 1 

fl> v ■ 


p n< t 

#p tL 


nirv 

Xiii : ** 


V 

i < . 


Mixed message of share option trends 


Better than 


good works 


From Dr Use Kracke. 

Sir, James Morgan got It all 
wrong in his article about pres- 
idents and cardinals (“All the 
president’s cardinals". Novem- 
ber 5). It was precisely Martin 
Luther who emphasised the 
importance of belief, not 
works. He had observed how 
“good works" were done by 
many people just to earn them- 
selves a little throne in heaven, 
not In order to help others, and 
he detested the then fashion to 
pay others to do the “good" 
works for you in order to 
achieve that aim. All that 
really mattered was believing 
in Christ's word - all the rest 
would follow. 

To start from the wrong his- 
torical premises would make 
one have grave donbts about 
the conclusions in the 
article . , . Oh, Financial Times, 
stick to your finances! 

Use Kracke, 

48 Druid Woods. 

Bristol BS9 1SZ 


From Mr Brian Friedman. 

Sir, Alistair Ross-Goobey 
(Book Review: “Why pay 
should be linked to success”, 
November 3) writes that there 
is no place for conventional 
share options in executive 
reward. 

The truth of Mr Ross- 
Goobey ’s comment is widely 
recognised among larger com- 
panies and an increasing num- 
ber of them are abandoning 
conventional share options in 
favour of restricted share plans 
for their most senior execu- 
tives. 

Many, however, are retain- 
ing share options Cor second 
tier management and some are 
using both share options 
and restricted share plans 


for senior executives. 

There is a mixed message 
here. If share options are no 
longer appropriate for senior 
executives, why are companies 
retaining them for lower levels 
of management? 

For the future, I believe 
more companies will push 
down the restricted share con- 
cept to lower levels of manage- 
ment Indeed, pioneering com- 
panies are already looking at 
phantom restricted stock plans 
and even phantom manage- 
ment buy-outs at the bus iness 
unit level (A phantom plan is 
one where the cash reward is 
designed to replicate the actual 
share price.) 

It is almost a truism to say 
that the only thing that really 1 


motivates is ownership - tbe , 
challenge is to create a struc- 0 
tore which encourages manag- 
ers to act like owners while not 
leading to internal divisions 
within business organisations. 

At present, there is often too 
much Cog between the efforts 
employees put in and the 
rewards that are generated 
under their equity-based incen- 
tive plans. 

Winning companies will find 
successful formulae to dispel 
the fog and to encourage clar- 
ity of vision. 

Brian Friedman, 

bead of compensation and 

benefits, 

Arthur Andersen & Co,, 
l Surrey Street. 

London WC2R2PS 


Fully informed decision I In other words 


From Mr Tony Young. 

Sir, An otherwise excellent 
article on employee relations 
in BT (Management: “Bad con- 
nections at BT”, November 7) 
was marred by suggestions 
that “the dispute over flexible 
working was resolved in a pri- 
vate chat between [Michael] 
Hepher [BT’s managing direc- 
tor] and Tony Young, leader of 
the NCU". 

If . I. as general secretary, 
“resolved” the issue With a pri- 
vate chat, what on earth was 
the executive council doing at 
its meetings on September 15 
and September 2o (tbe latter 
continuing until three o’clock 
in the morning)? 

It was debating the resolu- 


tion of a major industrial issue, 
which would otherwise have 
led to massive disruption of 
BT’s operation. My job was to 
ensure that the executive was 
able to came to a fully 
informed decision. 

Further, it was able to do 
this in tbe most democratic 
way, and in the most open of 
fomms. This is how trade 
unions come to decisions: not 
over cosy chats. 

Tony Young. 
general secretary. 

National Communications 
Union, 

Greystoke House. 

ISO Brunswick Road, 

Eating, 

London W5 IAW 


1 From Mr David Edwards. 

Sir, Jim Kelly reports (“Elec- 
tronic tax return spells end For 
dreaded form", November 7) 
Mr John Whiting as saying: 
“We do need to incentivise our 
system." 

This, I understand, will hug- 
eity the beneficiatloxis to be 
obtained by the electronirisa- 
tion of our tax returns. 

The cost of modifying the 
English language to accommo- 
date these developments has to 
be allowed for. Perhaps Dr 
Marshall of The Oxford Dictio- 
nary Group may care to com- 
ment. 

David Edwards, 


The Drive. 

Woking. Surrey GU22 OJS 


>jb» 


Or* 





FINANCIAL times THURSDAY NOVEMBER 10 l' >94 


* 


I? 


FINANCIAL times 

Number One Southwark Bridge* London SE1 9HL 
Tel: 071-873 3000 Telex: 922186 Fax: 071407 5700 

Thursday November 10 1994 


The new US 
prospect 


Voting a gains t government is one 
thing: making it work better is 
another. The Republican party 
won its landslide in Tuesday's 
Congressional elections by cam- 
paigning against President Clin- 
ton, and against a Democrat-con- 
trolled Congress. The fear must be 
that the new rulers of Congress 
win bring the same negativism to 
the job of government. 

In the course of a mean-spirited 
campaign, American voters were 
convinced that they needed a new 
Congress, and - to a greater 
extent than many on either side 
predicted - that is precisely what 
they got Republicans will have 
control over both Houses of the 
104th Congress, fa- the first time 
in over 40 years. 

For many, the results of the 
election are a recipe for two years 
of unrelenting legislative gridlock. 
The Republicans have only won 
thin majorities in the House and 
Senate. The Senate filibuster, a 
weapon the Republicans have 
recently used so effectively 
against Mr Clinton, might well 
return to haunt them. And Mr 
Clinton, for his part, mi ght decide 
to follow a Truman strategy of 
frustrating his opponents with lib- 
eral use of the presidential 
veto. 

It was certainly difficult to see 
the seeds of congressional and 
presidential bipartisanship in the 
campaign. But the very size of the 


Republican victory provides 
grounds for optimism. With con- 
trol in their hands, party leaders 
such as Senator Bob Dole risk 
finding it is their turn to suffer 
from electors’ frustrations. 

Mr Dole, at least, c laims to want 
to use his new position as Senate 
majority leader to forge bipartisan 
coalitions rather than frustrate 
them. He has sometimes done this 
in the past, but his own presiden- 
tial ambitions - and his more stri- 
dently partisan colleagues - may 
prevent him from translating this 
noble aim into practice. 

Important casualties 

For the rest of the world, the 
most important casualties of a fail- 
ure to achieve bipartisan coali- 
tions will be US trade and budget- 
ary policy. Mr Dole faces a test on 
the first on November 29, when 
the “lame-duck” I03rd Congress 
will finally vote an the ratification 
of the treat? agreed in the Uru- 
guay round of the GATT. 


Mr Clinton will doubtless use 
his upcoming trade talks in Asia 

and Latin America to reassure 
America's trading partners that 
the country's commitment to free 
trade has not been dented by 
recent events. But it is up to Mr 
Dole to ensure that the treaty gets 
the required number of Republi- 
can votes. Since the "fast-track 
procedure" for voting on the 
agreement applies only to the cur- 
rent Congress. a failed vote could 
signify the death of the treaty 
altogether. Moreover, it would be 
the ultimate signal that the US is 
set to turn inward in the coming 
years. 

Republicans co-operated with 
Mr Clinton to get the NAFTA 
treaty passed in 1993. For all the 
“America first-ism” of many a 
recent Republican campaign, 
there must be at least even odds 
that they will do so with regard to 
GATT. The odds on a serious 
attempt to reduce the budget defi- 
cit over the next two years must 
be considerably s limmer . 

Fiscal proposals 

The Republicans' election mani- 
festo in this area, the “Contract 
with America” published in Sep- 
tember, does not bode well. Lite 
many of the party’s past fiscal pro- 
posals, it is highly specific on pop- 
ular policies like middle-class tax 
cuts and a balanced budget 
amendment, but vague to the 
point of near-ellence on how the 
one is to be combined with the 
other. 

President Clinton shares the 
ambition Ear a middle claas tax 
cut. But he too has shied away 
from the specifying the cuts in 
entitlement programmes like 
Medicare and Medicaid which 
would be necessary to pay for 
such a tax cut 

The Kerrey Commission on enti- 
tlement reform, which will report 
in December, will probably point 
to the drastic reforms necessary, 
to reduce the long-term budget 
deficit, regardless of any further 
fen in the tax burden. A Congress 
which was not bom of a campaign 
as steeped in political opportun- 
ism as this one might, just might, 
have used the commission's pro- 
posals as a basis for constructive 
legislation. It is up to the Republi- 
cans to decide whether the new 
Congress can transcend the 
negativism from which it 
emerged. 


Planning for 
higher prices 


Few things better illustrate the 
benefits of competition, than the 
recent price war in British retail- 
ing. The consumer has enjoyed 
value tor money to a far greater 
extent than in the consumption- 
led recovery of the 1980s. Retailers 
who have kept prices under con- 
trol have been rewarded with 
higher volumes and sales values. 
The wider benefit has come from 
the powerful restraining influence 
on prices generally. What is the 
risk that this virtuous circle may 
break down? 

Producer price inflation is an 
obvious potential villain of the 
piece. Yet the fear here may wall 
be exaggerated. The message from 
Marks . and Spencer, which 
reported interim profits earlier 
this week, was that its ability to 
pass on producer price rises is 
minimal Other leading retailers 
have told much the same story. If 
they are right, producers who face 
rising prices for raw materials and 
Imported manufactures may sim- 
ply confront the same choice as 
the retailers. Either they raise 
prices and risk an immediate loss 
of market share; or they join in 
the competition and hope that 
increased volume will a&feet their 
lower margins. 

. A more plausible ground for 
concern lies in the peculiarities of 
the present disinflationary pro- 
cess. The unexpected , price sensi- 
tivity of consumers is partly a 
reflection of recession; also of the 
stretched state of the personal sec- 
tor balance sheet after the borrow- 
ing htng ia of the 1980s. Time and 
the precautionary urge to pay 
flown debt from increased earn- 
ings could ultimately lead to a 
more insouciant consumer atti- 
tude towards prices. Yet the most 
powerful longer-run force threat- 
ening the current price discipline 
probably lies in planning poKcy. 

Price restraint 

The, present retail price war is 
to a considerable degree a reflec- 
tion of oversupply in retail prop- 
erty. This stemmed from a relax- 
ation in the approach to p lannin g 
consents in the 1980s, particularly 
in relation to out-of-town shopping 
centrea Crastemted with an unex- 
pectedly liberal environment big 
retailers were tempted simulta- 
neously to expand. The result was 
overdevelopment. An 
number of new*buttets contributed 


significantly to the high degree of 
price restraint that has marked 
the economic recovery. 

Under Environment Secretary 
John Gummer this period of liber- 
alisation is drawing to a close. 
Last week he declared that the 
balance must be tilted away from 
out-of-town shopping centres back 
to the town centre. Henceforth the 
em phasis in planning will be an 
the revitalisation of town centres, 
the building of communities and 
reduced dependence on the motor 
car. Shopping malls on by-passes 
are out of favour. 

Local monopoly 

Pew would quarrel with Mr 
Glimmer's aspiration to e nh a n ce 
the quality of life. But whether his 
policies will achieve the desired 
goal is a moot point The first 
impact of more restrictive plan- 
ning will be to reinforce the local 
monopoly of those out of town 
retailers who have not yet been 
subjected to additional competi- 
tion. It will strengthen the hand of 
smaller retailers in town who 
have weak buying power, few 
economies of scale, high fixed 
costs and thus a poor capacity to 
offer discount prices. More gener- 
ally. a restrictive planning policy 
will tend to favour the inefficient 
retailer relative to those better 

able to deal with competition. 

Meantime the new emphasis on 
town centre redevelopment raises 
longstanding questions about con- 
gestion and the ability to provide 
adequate car parking space. While 
Mr S ummer insists that “people 
want a sensible balance in the sit- 
ing of shopping centres”, the expe- 
rience of retailers seems to be that 
people like using their cars. 

Either way. if this shift in policy 
does prove to be- more restrictive 
overall, those retailers and prop- 
erty developers now suffering 
from the consequences of overdev- 
elopment will be cheering in the 
aisles. Just as George Brown made 
fortunes for countless property 
developers with his 1964 ban on 
office building in London, so Mr 
Gummer will have provided large 
windfall gains to those whose 
pl ap pfag consents came through 
both in time and in the right 
place. 

We are back to the 1980s - or is 
it the garden-city-minded 1940s? 
Either way, the consumer will not 
be a beneficiary. 


B elieve it or not - and 
after Tuesday’s Massa- 
cre of the Democrats, it 
requires some stretching 
of the imagination - 
there are serious people arguing 
that Bill Clinton is potentially in 
better shape today than since he 
became president. More remark- 
ably, some of these people are 
Republicans, whose joy at their vic- 
tories in the mid-term elections 
should be unalloyed. 

They draw on the lesson of 1948. 
when President Harry Truman, sad- 
dled with a Republican landslide 
two years earlier, won re-election 
by campaigning against the? 
“do-nothing Congress". 

The contemporary analogy was 
provided by a senior member or the 
Reagan administration on polling 
night “If the Republicans were to 
lead the majorities (in Congress) the 
way they’ve led the minorities, they 
would be in trouble. They'd give 
Clinton a target to run against in 
1996 - and though be might not be 
a skilled chief executive, he sure is 
a skilled politician. And it is not as 
if they speak with one voice.” 

On Tuesday night, even Newt 
Gingrich, the slasb-and-burn con- 
servative Republican from Georgia 
who stands to be the next Speaker 
of the House, sounded for the first 
time a little awed by what lay 
ahead, promising co-operation 
rather than confrontation with the 
White House. He went so Ear as to 
speak relatively kindly of his fellow 
Republican Robert Dole, majority 
leader in the next Senate who is 
only occasionally an ideological 
bedfellow. 

The Republican sweep was 
impressive, with control of the 
House for the first time in 40 years, 
of the Senate for the first time in 
eight, and with at least eight Demo- 
cratic governors evicted. 

Oliver North and Michael Huf- 
fington, poster boys of the alienated 
hard right, lost in Virginia and Cal- 
ifornia and Ted Kennedy won in 
Massachusetts. But otherwise the 
cull of famous Democrats was large: 
Mario Cuomo in New York and Ann 
Richards in Texas among the gover- 
nors; Jim Sasser, who might have 
been the next party leader in the 
Senate, in Tennessee; Congressmen 
Dan Rostenknwski in Chicago and 
Jack Brooks in Texas, past and 
present chairmen of the ways and 
means and judiciary committees 
with 78 years in the House between 
them. 

The biggest scalp of all - of 
Speaker Tom Foley in the state of 
Washington - was half-hanging 
from the belt of a Republican nov- 
ice, awaiting only the counting of 
absentee ballots. 

Almost all the voter tunes were 
sung from the Republican hymn- 
book. The promise of less govern- 
ment and lower taxes helped 
George Pataki beat Mario Cuomo. 
Referenda on tax-cutting and limit- 
ing the terms of elected officials 
were passed almost everywhere 
they were on the ballot 
Most Democrats were out-toughed 
on the crime issue, with Governor 
Lawton Chiles's survival in Florida 
over Mr Jeb Bush a rare exception 
and Mr Cuomo's defeat the classic 
proof. Conservative hostility to ille- 
gal immigration was endorsed com- 
fortably in California. The right- 
wing Christian lobby failed to 
return Oliver North, but did well 
elsewhere. The gun lobby was 
instrumental in knocking off Mr 
Brooks in Texas, accusing him of 
apostasy on gun control. 

A constant national strain, most 
virulent in the south and its bor- 
ders. was distrust and a dislike akin 
to hatred of Mr Clinton himself. 
Democrats lost in all the states to 
which the president had devoted his 
energies in the last week of cam- 
paigning - Minnesota, Delaware, 
Michigan . Pennsylvania and Ohio. 
Mr Gingrich, it appears, made the 
right strategic decision in turning 
the mid-term elections into a plebi- 
scite on the presidency. 

But the US still must be governed 
in the next two years and tins is 
where Republican elation is tem- 
pered among its more thoughtful 
members. The party's “contract 
with America", effectively its elec- 
tion manifesto, lays out a plan and 
a lOOday timetable for introducing 


Gergantuan 

problem 

■ For Bill Clinton it never rains 
but it pours. Now he's been 
deserted by David Gergen, the 
shrewd 52-year-old spin-doctor who 
helped presidents Nixon, Rea g a n 
and Bush in many a j am. 

Gergen is off to teach at Duke 
University, where his father was 
once head of the mathematics 
department Clinton brought 
Gergen, former editor of magazine 
US News and World Report into the 
White House in May 1993 to stop the 
administration drowning in a tide 
of disasters. Gergen scored: 

Clinton’s approval rating jumped 
from 37 to 60 per cent in February 
this year. 

But some prophetic words were 
painted in February this year by 
The Economist magazine: “Watch 
toe Gergenometer. When it reads 
“jump ship’, it should be a good 
indication of when one consummate 
insider reckons this presidency has 
peaked.” 

At Duke. Gergen will be teaching 
a course in “governing in today's 
America”. He should sign up the 
Clintons, pronto. 


Outposted 

■ The remarkable economic 
progress of Humberside, in the 
north of England, will be further 
confirmed today by the final 


President Clinton may find a crumb of 
comfort in his party's heavy defeat in the 
US mid-term elections, says Jurek Martin 

Desperately 
seeking solace 


legislation, but its passage in any- 
thing approximating the proposed 
form may be doubted. 

One reason for doubt is resistance 
to it by moderate Republicans in 
the Senate (Mr Dole, for one, is still 
sitting on the fence over term lim- 
its). Another is that Mr Clinton pos- 
sesses a veto and the Democrats 
enough numbers, if they stick 
together, to block legislation in the 
Senate by filibusters, much as the 
Republicans did in the last session. 

Not all will be legislative gridlock 
revisited. The Republican party’s 
contract demands that the president 
be given a “line item” budget veto, 
empowering him to strike out an 
offending item of spending without 
throwing out a whole bill Mr Clin- 
ton has no problem with this, since 
he advocated it in 1992. 

Nor will he resist the middle class 
tax cut demanded by Republicans. 
This is already in the White House 
plannin g stages, though f unding it 
without increasing the federal defi- 
cit is another matter. 

Welfare reform is a subject on 
which both parties agree in princi- 
ple. differing only in detail. Modest 
healthcare reform initiatives cannot 
be excluded. 

But battles royal can be expected 
on many other fields - on the pro- 
posed amendment to the constitu- 
tion requiring a balanced budget, 
for example, and on Republican 
desires to beef up defence spending. 
The thorniest problem wifi be the 
cutting of federal "entitlement” pro- 
grammes such as social security 
and medicare, where the Republi- 
can contract promised “gain with- 
out pain”. 

The conduct of foreign policy, and 
its economic and trade components, 
will not be any easier, especially if 
Senator Jesse Helms of North Caro- 
lina, the ultimate arch-conservative, 
exercises his option to chair the for- 
eign relations committee (he has 
the choice of agriculture). The new 
“America First" Republican major- 
ity in the House features few con- 
ventional internationalists and sen- 
timent against US military 
excursions overseas or involvement 
in Bosnia, Rwanda and other dis- 
tant hotspots has increased on the 
right complementing its presence 
on the left. 

Just as serious is the weakening 
of the old Republican free trade con- 
stituency that helped pass the 
North American Free Trade Agree- 
ment last year. If the lame-duck 
Congress does not approve the legis- 
lation to implement the Gatt Uru- 
guay Round in three weeks - and it 
will do so only if enough retiring 
members vote with their con- 
sciences and defy an electorate to 
which they are no longer subject - 
its prospects iu 1995 look bleak. 
Other trade initiatives in Asia and 
South America, both with summits 
In the next five weeks, could be 
still-born unless what are perceived 
as American interests are aggres- 
sively protected. 

Even if the political will to co- 
operate proves stronger than expec- 
ted, mutual animus is certain to 
increase because the Republicans 
will use their majorities to make a 
meal out of Whitewater. The tan- 
gled skein of the first family’s 
investments long ago in Arkansas 
has been off the political screen for 
the last few months while the spe- 
cial counsel, Mr Ken Starr, goes 
about his work. But the hiatus will 
not last 

Mr Gingrich has already promised 
a wholesale investigation of “White 
House corruption". But even his 



Robert Dole, next majority loader of the Senate B» Clinton, president 

Senate Seats: ilpo- 




Governors' 




Republicans 

31 1 
flormerty 2£9 


Figures tncJuOe wnw unettoai returns 


zeal is likely to pale in comparison 
with that of Senator A1 D’ Amato 
from New York. He is expected to 
turn his chairmanship of the bank- 
ing committee into a standing 
inquisition not only into White- 
water but also into the president’s 
private life and the suicide in the 
su mm er of 1993 of Vince Foster, the 
close Clinton friend and deputy 


The US still has to be 
governed in the next 
two years, and this is 
where thoughtful 
Republicans’ elation 
is tempered 


White House legal counseL 
Having helped dispose of Mr 
Cuomo, the senator's notorious 
appetite for blood has been whetted. 
He is likely to find an ally in Con- 
gressman Jim Leach of Iowa, 
another leading Whitewater critic, 
who stands to inherit the House 
banking committee from Henry 


Gonzalez, the president's staunchest 
protector. Both panels, it must be 
assumed, will leak like sieves and 
arrange for televised hearings with 
maximum exposure. 

Further complicating the immedi- 
ate future is the polarisation of both 
parties, if anything more acute 
among Republicans than Demo- 
crats. The House may prove mono- 
lithic under Mr Gingrich, but there 
is an influential fistful of Senate 
moderates - including Bill Cohen of 
Maine. Nancy Kassebaum of Kan- 
sas. Bob Packwood and Mark Hat- 
field of Oregon, John Chafee of 
Rhode Island and James Jeffords of 
Vermont - with committee senior- 
ity and a preference for pragmatic 
over conviction politics. 

It also matters that the country is 
about to enter another election 
cycle - for the presidency In 1996. 
Unless there is some awful White- 
water development that sinks pub- 
lic confidence in him irrevocably, 
Mr Clinton still looks the likely 
Democratic candidate. If not him, it 
will be Vice-President A1 Gore, 
bruised though he was on Tuesday 
by the Republican sweep in his 


Observer 


granting of planning permission 
and funding for a £520m gas fired 
power station at Grimsby. 

And last year the Humber estuary 
shifted more than 60m tonnes of 
cargo, knocking the Thames off its 
pedestal as the UK’s biggest 
seaborne trading zone, and putting 
the Channel tunnel's projected 8m 
tonnes a year into perspective. 

So why choose London for the 
presentation, which is intended to 
promote business opportunities 
associated with a new offshore 
terminal? Humberside county 
council says about 100 people will 
turn up for today's beano at the 
Selfridges Hotel, and that far Fewer 
would bother to travel north. 

Some confusion here, surely. 
Those who would travel north - it’s 
hardly a time-zone change - would 
thus be establishing themselves as 
genuinely interested in the area. 

But how many at Selfridges will 
simply be taking a swift free lunch? 


Energetic, payer 

■ It must say something about 
Turkey - but what? - that the 
country’s largest individual 
taxpayer should be Matilri 
Manukyan. doyenne of Istanbul’s 
madams. Last year she was busy 
enough to justify a S722.751 tax bill. 

She went along to an Istanbul 
chamber of commerce prize-giving 
ceremony for top taxpayers. But 
instead uf receiving her gold plaque 
from the hands of president 
Suleyman Demire] himself, she was 



fobbed off with the chamber’s 
vice-president. 

Did she feel offended? Maybe. But 
she must be getting used to this 
kind of treatment - it’s the third 
successive year she has walked off 
with the prize. 


Soccer heroes 

■ Whatever the outcome of the 
latest allegations about sleaze in 
British football, one has to look 
overseas to find the juiciest scams. 

In 1983 Hungary uncovered a 
match-fixing conspiracy, resulting 
in 260 players and 14 referees being 
suspended and 75 people convicted 
of criminal offences. Even that 


doesn’t quite match the Yugoslav 
teams involved in a crucial 1979 
end-of-season match: the score was 
134-1 (a goal every 40 seconds), 
which would have been an all-time 
record - but for the fact that a deal 
had been struck before kick-off. 


Gegarbaged 

■ The French may be building 
barricades to preserve their 
language from Anglo-Saxon 
barbarisms - but what about the 
Germans? 

The language or Goethe. Schiller 
and Boris Becker is in danger of 
being eroded by influences from 
beyond Europe’s mainland. 
Cefoimded and gementioned - as in 
“our company was grounded? 
(founded) or “will we be 
gementionetff" (mentioned) - are 
two newcomers assaulting sensitive 
German ears. 

Gemanaged is an old one, as are 
gehandikapt and gekidrutppt . Any 
suggestions for others? 
Gebreakfasted, getroubled and 
gesacked immediately spring to 
mind. 


Muddy machismo 

■ Questioning an Argentine's 
credential as a political prisoner 
during the “dirty war” is asking for 
trouble - particularly if he happens 
to he the president 
Carlos Menem has filed a libel 
action against one of the country's 


native Tennessee. A challenge can- 
not be ruled out, either from the left 
or from the grumpy middle repre- 
sented in 1992 by Paul Tsongas. But 
at present it appears unlikely to 
succeecL 

Tbe Republicans, however, are no 
closer to finding candidates for 1996 
than they were before the mid-term 
elections. All the leading suspects 
are still around, but Senator Dole 
will be preoccupied with congres- 
sional management and Mr Ging- 
rich has no known presidential 
ambitions. Senator Phil Gramm of 
Texas did his cause good by cam- 
paigning mightily for Republican 
candidates and has assembled a 
substantial war-chest, hut his man- 
ner turns as many people off as on. 

Lamar Alexander, former cabinet 
member mid governor of Tennessee, 
has been diligently cultivating the 
grassroots, as have Dick Cheney, 
ex-secretary of defence, and James 
Baker, ex-secretary of everything. 
The bids, more likely for the vice- 
presidential slot, from three gover- 
nors returned on Tuesday - Pete 
Wilson in California, Tommy 
Thompson in Wisconsin and Wil- 
liam Wield in Massachusetts - have 
gained in value, while the stock of 
Christie Whitman of New Jersey 
remains high. 

However, the ideological differ- 
ences between the above personali- 
ties could burst at the seams the 
“big tent” that the party professes 
to represent. And some proto-candi- 
dates may find it easier to get 
elected to the White House than 
win the Republican Domination. 
One who surely cannot win the 
nomination because of rightwing 
opposition but has already put 
down a marker for the moderates 
by declaring Is Senator Arlen Spec- 
ter of Pennsylvania. 

W ith the main par- 
ties divided or list- 
less and distrusted, 
an independent 
candidacy in 1996 
remains on the cards. Ross Perot 
can boast that his endorsements, 
generally of Republicans, worked 
(though not at home in Texas with 
the defeat of Ann Richards). 

Mayor Rudolph Gi uliani of New 
York, a nominal Republican who 
endorsed Mr Cuomo, would have 
looked better as an Independent 
prospect in 1996 if the governor had 
won. Now he may be forced into his 
destiny by taking on his long-term 
foe Senator D’Amato in the 1998 
Senate race. The political right 
remains the more fertile ground for 
independents and libertarians and, 
as in 1992. that is also not necessar- 
ily bad news for Mr Clinton because 
it will divide, the Republican vote. 

However, the president cannot 
afford to to sit back and wait. To 
sacrifice the initiative to the Repub- 
lican Congress over the next two 
years would be good for neither his 
government nor his own political 
future. He could choose to go veto- 
crazy, but George Bush's exercise of 
that power did him no good at alL 
Thus the White House watch- 
words of the moment are of “reposi- 
tioning” or “relaunching” the presi- 
dency. With the economy still in 
reasonable shape and with foreign 
policy suddenly fruitful (Haiti, 
North Korea, the Middle East. Rus- 
sia, if not Bosnia), Mr Clinton is not 
without fertile prospects. No less 
than five foreign trips are on, his 
schedule for next year. If the coun- 
try. in its isolationist mode, ignores 
external policy it is a fair bet that 
Mr Clinton win return to some of 
the domestic themes that propelled 
Him into office in 1992 - emphasis 
on personal and community respon- 
sibility. tolerance in race relations, 
for example. 

But sooner or later, and all of 
yesterday's protestations of cooper- 
ation notwithstanding, Mr Clinton 
will surely round on the Republi- 
cans r unning Congress and their 
record in exercising the power to 
which they have long been unaccus- 
tomed. And that is why some seri- 
ous Republicans are worried by 
Tuesday's results. 

For the overriding lesson of the 
congressional mid-term elections, as 
it was to a degree in 1992, is that it 
is for easier to run against some- 
body or something than for both. 
Ask the ghost of Harry Truman. 


sparkiest daily newspapers, the 
leftist Pagina 12, after its editors 
cast doubt on his claim to have 
been tortured under the former 
military dictatorship. On October 30 
the paper quoted former prisoners 
as saying that Menem - who was 
arrested after a 1976 military coup 
ousted president Isabel Peron - was 
never tortured and that he had 
cried upon being arrested. 

Pagina 12 seems undaunted- 
“What we have here is somebody 
who is sick in the head. Before we 
poked ton at him. but now the jokes 
are becoming monotonous,” is the 
printed riposte by columnist 
Osvaldo Soriano. 

Few prominent libel cases ever 
seem to reach court in Buenos 
Aires. But given that Menem hopes 
to be reelected in 1995, maybe this 
one might 


In the pink 

■ Another satisfied reader. Last 
week a rival newspaper reported 
that Luca Cumani, the Newmarket 
trainer, used shredded copies of The 
Times as bedding for his 
racehorses. 

But, he said, if a horse wins a big 
race, he switches its bedding to the 
Finan c ial Times - so the winner 
can read where to put its money. 
Following the success of Barathea 
in last Saturday’s Breeders’ Cup in 
Kentucky, the bay. whose jockey 
was dad in pink, is now reported to 
be enjoying the Pink’un in 
retirement in Ireland. 



M— SENIOR 
gRomFLEXOMCS 

A world leader in 
flexible connectors 

Tel: Q923 77SS47 
A Division of Senior Engineering Group pic 


FINANCIAL TIMES 

Thursday November 10 1994 



Early decision on his successor is unlikely ( Sweden’s 


Caretaker world trade 
role seen for Sutherland 


By Frances WHBame In Geneva 

Mr Peter Sutherland, the 
director-general of the General 
Agreement on Tariffs and Trade, 
is believed to be ready to stay on 
in a caretaker role as head of the 
future World Trade Organisation 
if the contest for his successor 
remains deadlocked. 

Mr Sutherland, whose official 
term ends in July neirt year, has 
stated he will not be a candidate 
for director-general of the WTO, 
which is expected to begin work 
on January L 

It now appears unlikely that a 
decision on his successor win be 
made by early next month, when 
Gatt members are due to endorse 
the appointment. This will make 
it virtually impossible for the 
new head to start in January. 

Although no formal proposal to 
stay on has yet been made to Mr 
Sutherland, it is being discussed 
by trade diplomats anxious to 
assure a smooth transition from 


Gatt to the mare powerful WTO. 
However, some officials hope the 
decision on the choice of WTO 
rhirf can sKii be ma de by next 

month- 

A third round of consultations 
among Gatt members on the 
appointment will be held in 
Geneva this week. 

Trade officials said yesterday 
they expected the outcome to be 
a continued three-way split on 
regional lines between Mr Benato 
Ruggiero, the EU candidate, Mr 
Carlos Salinas de Gortari, the 
outgoing Mexican president who 
has US and Latin American back- 
ing. and Mr Kim Chul-su of 
South Korea who has Asian sup- 
port 

Although Mr Ruggiero is ahead 
numerically, the eventual deci- 
sion must be made by consensus. 
Delays in ratifying the WTO and 
the associated Uruguay Round of 
global trade accords, the contin- 
ued stalemate over the next 
OECD secretary-general and the 


lack of engagement of the US in 
the WTO race are all seen as 
obstacles to consensus. 

To these must now be added 
uncertainty over the outcome of 
the Uruguay Round vote by the 
US Congress in three weeks' 
time. A rejection by Congress 
would certainly kill the WTO, 
which could not operate effec- 
tively without the participation 
of the world's biggest trader. 

Of Gatt’s 124 members, only 
about 30 countries have so Car 
ratified the world trade pact, and 
they do not include any of the 
Quad group of leading traders - 
the US, the EU, Japan and Can- 
ada. Most have been awaiting the 
US decision. 

The mid-term elections and the 
impending Uruguay Round vote 
have also kept the US out of the 
active horeetradiiig that will be a 
part of an eventual deaL 

Congress and Gatt, Page 4 
Gatt chief ready. Page 8 


Japanese banks condemn 
rival over savers 5 lottery 


By Gerard Baker in Tokyo 

Japan's banking fraternity was 
divided yesterday when a credit 
banks' association condemned 
one of its more ambitious mem- 
bers for launching a lottery to 
attract new savers. 

On Monday, Johnan Shinkin 
(Credit) Bank offered a savings 
account that made depositors eli- 
gible for a twice-yearty raffle. In 
addition to the normal interest 
rate on the one-year deposit, sav- 
ers were offered the incentive of 
cash prizes of up to Y80.000 
($520). 

The scheme was a hit with 
investors. On the first day, the 
hank collected YlObn in deposits. 
And within hours the bank's anx- 
ious rivals had cried foul, accus- 
ing Johnan of stealing an tmfair 
march on the rest of the sector. 

The banks' objection is that the 
new account breaches a self-im- 
posed rule that institutions will 
offer only gifts and not cash 
bonuses as incentives, and that 
gifts should not exceed YL500 in 
value. 


Yesterday the banks' grievance 
was dignified by Mr Keikichi 
Kato, chairman of the National 
Association of Shinkin Banks, 
who issued an unprecedented 
censure of johnan's action. 

He said it was “regrettable 
Johnan was neglecting the asso- 
ciation's voluntary rules". 

It is very unusual far a finan- 
cial insti tuti on in Japan to break 
ranks so unapologetically with 
its competitors, and Johnan's 
move may herald a more inde- 
pendent approach by the main 
banks. 

Observers were sceptical of the 
the banks’ stated concerns. 

A more serious objection seems 
to be that Johnan has found a 
novel way to offer a higher inter- 
est rate to depositors. 

The bank calculates that the 
average customer has a 3.38 per 
cent chanre of winning a prize, 
and that the overall effect of the 
scheme is to offer an extra 02 per 
cent interest to savers. 

Last month, the last regula- 
tions on interest rates were 
finally lifted by the finanpw min. 


is try, leaving banks free to 
set their own rates for deposit- 
ors. 

But since the changes, most 
hanks have continued to offer 
remarkably similar rates, and 
consumer groups have expressed 
doubt about tire strength of their 
commitment to open compet- 
ition. 

A finance ministry official said 
that, since the banks’ rule is vol- 
untary, the ministry was not in a 
position to act But he added: It 
is questionable whether it is 
appropriate for public-spirited 
financial institutions to set up 
lotteries in an attempt to gam 
deposits." 

Johnan was un re pe n tant yes- 
terday. A spokesman said the vol- 
untary restraint was against the 
spirit of financial deregulation, 
since it represented “a form of 
collusion" among the country's 
banks to deprive customers of 
the benefits of free - markets. 

He dismissed the row as simply 
“labour pains" at the birth of a 
new era in the country's finan- 
cial system. 


German TV I US stocks fall after gains 


Continued from Page 1 

Europe's multi-media industry, 
arguing that it was possible for 
cross-border deals to take place 
without individual markets being 
closed off. 

"Television without frontiers 
can only be accomplished if pro- 
gramme suppliers from other 
member states are not faced 
with, prohibitive entry barriers 
in national markets," he 
said. 


Continued from Page i 

most of their gains. London’s 
FT-SE 100 index closed up 352 at 
3,099.6, while in Frankfurt the 
Dax index rose 43.03 to 2,096.47. 

Wall Street was concerned that 
discord between the White House 
and Congress might lead to legis- 
lative gridlock, and that a hard- 
line Republican leadership could 
block progress on international 
trade. 

Mr Richard McCabe, chief mar- 


ket strategist at Merrill Lynch, 
said: "There is a debate on on 
Wall Street as to whether Repub- 
lican control of both houses 
leads to more legislation that is 
good for the market, or whether 
it leads to more deadlock." 

Mr Hoey said positive effects 
from the elections would soon 
fade. “The stock market is left 
with all tiie same issues it had 
before, in terms of the outlook 
for the economy and the possibil- 
ity for more Fed tightenings.” 


PM pledges 
more jobs if 
voters back 
EU entry 

By Hugh Camegy In Stockholm 

Mr Ingvar Carlsson, the Swedish 
prime minister, yesterday 
stepped up his hardrpressed cam- 
paign to win approval for Swed- 
ish membership of the European 
Union in Sunday's referendum, 
promising an mgeni government 
programme to increase employ- 
ment if there is a Yes vote. 

“Immediately after a Yes In the 
referendum, the government will 
formulate a programme to pro- 
mote more sustainable employ- 
ment in industry ... This work 
will be done in constructive 
co-operation with the labour mar- 
ket partners,” be said in a news- 
paper article. 

Meanwhile. Mr Carlsson and 
his fellow Social Democratic lead- 
ers in Denmark, Finland and 
Norway issued a joint declaration 
on Tuesday night asserting that 
If Denmark's Nordic neighbours 
joined it in the EU, social demo- 
crats would strengthen their 
influence inside the Union. 

The Danish, Norwegian and 
Swedish governments are led by 
social democrats and the Finnish 
Social Democratic party is expec- 
ted to win a general election next 
March. Finland has already voted 
to join the EU and Norway will 
hold a referendum on November 
28. 

Pro-EU campaigners have this 
weak urged Mr Carlsson - who 
celebrated his 60th birthday yes- 
terday - to work harder to win 
over the many Euro-sceptics in 
his own deeply-split party to help 
overcome a strong Swedish 
anti-EU campaign in Sunday's 
vote. 

The left-dominated No side, 
which some recent polls have 
suggested is in the lead, has 
argued that anti- inflation policies 
steered by right-of-centre govern- 
ments in the leading EU coun- 
tries have been responsible for 
high unemployment within mem- 
ber states. 

The No campaign niMfwtwi yes- 
terday that entering the EU could 
cost as many as 340,000 jobs in 
Sweden, an top of the 575,000 - 
more than 13 per cent of the 
workforce - already unemployed. 

It said the financial COSt of 

Swedish membership, coupled 
with the effect of bringing down 
value-added tax to EU levels, 
would eventually force the 
country Into deep public sector 
cuts. 

In his article in Dagens 
Nyheter, Mr Carlsson countered 
that the EU was committed in Its 
policy document of last year to 
working towards lower unem- 
ployment. Joining the EU would 
give Sweden financial stability 
and encourage investment. 

“These are the conditions - 
reasonable interest rates and a 
more secure investment climate 
- that create new possibilities to 
fight against unemployment- It is 
these conditions that I quickly 
want to take advantage of after a 
positive result in the referen- 
dum," he wrote. 


FT WEATHER GUIDE 


Europe today 

Most of western Europe wiU remain 
unsettled with the heaviest ram expected 
ri Scotland, southern France and northern 
Italy. North-west France and Ireland wfll 
have seasonal temperatures and some 
dewing. Northern and north-east Europe 
will be wintry. It wiU stay below freezing 
north of the line from Moscow to Oslo with 
strong frost north of Kiruna. it w3l be 
settled from the northern Balkans to 
northern Germany with persistent morning 
fog and a few afternoon breaks in foe 
cloud. The eastern Mediterranean wfll be 
mainly (fry with temperatures rising to 
18C-22C. Areas around foe Black Sea 
may have founder showers. 

Five-day forecast 

The rain over Italy wiU move east to affect 
most of the Balkans and Turkey. High 
pressure settling over the Baltics this 
weekend will induce sunshine and below 




<a - . 

12 


from Russia to central and northern 
Europe Low pressure arriving from the 
Atlantic win bring back rain to western 
Europe. 


TODAY'S TEMPERATMES 


Jit. ‘ '2&‘ \ • ‘ / , 1020 ' 

- 

wipin' front CoM front .A-A, Wind speed In KPH ;■ ,■ . 

Situation at 12 GMT. TemperOHms maximum for day. F or ec a sts by Mexa Consult of the Netherbnds 





Madman 

Bdgng 

fair 

13 

Caracas 

Ur 

30 

Faro 

lair 

21 

Madrid 

Ur 

15 

Rangoon 

sun 

33 


C43U3 

Belfast 

Shower 

11 

CardU 

shower 

13 

Frankfurt 

shower 

8 

Majorca 

Ur 

21 

Reykfce* 

doudy 

4 

Abu Dhabi 

fair 

30 

Belgrade 

fatr 

16 

Casablanca 

fair 

21 

Geneva 

shower 

10 

Malta 

fair 

23 

no 

shower 

23 

Accra 

ft* 

31 

Baffin 

5 s 

8 

Chicago 

sun 

7 

Gibraltar 

Wr 

21 

Manchester 

doudy 

12 

Roma 

rain 

19 

Algiers 

ft* 

22 

Bermuda 

far 

27 

Cologne 

drzd 

IT 

Glasgow 

rail 

11 

ttttii 

fair 

30 

S. fieeo 

shower 

14 

Amsterdam 

cfczzJ 

11 

Bogota 

shower 

19 

Data* 

sun 

29 

Hamburg 

tioudy 

8 

Melbourne 

sun 

25 

Soon! 

doudy 

14 

Altera 

Hr 

21 

Bombay 

lair 

33 

Mbs 

fair 

19 

HeteMd 

doudy 

■5 

MorfcoGfcy 

far 

23 

Singapore 

rain 

30 

Atlanta 

(air 

19 

Brussels 

drzd 

12 

OeH 

sun 

29 

Hang Kong 

sun 

28 

Miami 

lair 

27 

Stockholm 

doudy 

2 

B. Afros 

Sun 

2S 

Budapest 

fa t 

10 

Dubai 

fair 

30 

Honolulu 

tar 

29 

Atian 

ran 

11 

Strasbourg 

lair 

8 

BJwn 

Cloudy 

12 

CJiagen 

snow 

2 

Dublin 

shower 

12 

Istanbul 

fair 

17 

Montreal 

sfaat 

4 

Sydney 

Mr 

22 

Bangkok 

ft* 

33 

Cairo 

fair 

24 

Dubrovnik 

shower 

18 

Jakarta 

fat 

31 

MOSCOW 

snow 

0 

Tangier 

Mr 

19 

Barcelona 

ft* 

19 

Capo Town 

fair 

22 

Edinburgh 

rain 

11 

Jersey 

sho war 

12 

Munch 

ft* 

8 

Tel Aviv 

fair 

23 










Karachi 

sun 

33 

Nairobi 

fair 

25 

Tokyo 

fair 

17 


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make us their first’ choice. 


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l_ Angeles 

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Lima 

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London 

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Lyon 

Madeira 


25 Naples 
19 Nassau 
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13 Odo 

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13 Perth 

23 Prague 


18 Toronto 
29 Vancouver 
10 Venice 
17 Verna 

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22 Wnrapeg 
8 Zurich 


shown- & 
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cloudy 8 
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THE LEX COLUMN 


Capitol confusion 


The mar kets' initial reaction to the 
Republicans’ mid-term triumph was 
euphoria. In many cages, the rationale 
was Utile more than the mantra that 
Republicans are good for business. In' 

a few sectors, the increases were more 
justifiable. Defence stocks soared on 
hopes that traditionally hawkish 
Republicans could halt the decline in 
military spending. The effective death 
of the Clintons' healthcare package 
pushed up drags stocks on both sides 
of the Atlantic, even though its demise 
will do nothing to ease margin pres- 
sures caused by the consolidation of 
the industry’s customer base. 

Then reality set in. The risk that 
Republican isolationists could block 
ratification of the recent world trade 
agreement - with all the consequent 
dangers for the world economy - has 
increased. Most w o rr yin g is that pru- 
dent fiscal policy could be sacrificed 
on the altar of political expediency. 
With only two years to go before the 
presidential elections, Mr Clinton and 
the Republicans could start competing 
over who can deliver the largest tax 
cuts. (Sven that taxes are easier to cut 
than spending, the budget deficit 
could wiw» again, start expanding. The 
markets fear that could boost infla- 
tion, unsettle bonds and equities and 
require even larger increases in Inter- 
est rates. 

Any hopes that the elections would 
reduce uncertainty have been unfulfil- 
led. Indeed, yesterday's erratic move- 
ments probably represent a harbinger 
of greater market volatility brought by 
the Republicans’ victory. 

Underwriting fees 

There has been a hostile reaction to 
Mr Paul Marsh’s report on UK sub-un- 
derwriting commissions from some 
sections of the City. The current sys- 
tem for raising raptai through rights 
issues suits the City very well Many 
institutions anil merchant fwwfra fear 
that the OFT-sponsored report will 
provide useful ammunition for those 
seeking to move London towards the 
New York model for raising equity. 

But the report does not question the 
virtues of the rights issue system. It 
merely argues that the fixed 155 per 
cent commission paid to sub-under- 
writers provides them with excess 
returns. Mr Marsh calculates these by 
ndrtg an option valuation method to 
establish a “fair" price in each case. 
This is based partly cd the historic 
volatility of a particular share price 
winch his critics argue is likely to 
phflnga during a rights issue, hi fact, 


FT-SE Index: 3099.6 (+35.8} 


Sfranr rJltoerot^vatoTha 1 MX frfd« 


• -1890 • ,.w « 

Soares: FT GrepWfa’ - * J - - ' 2; *., • ;• f' *. ‘ ; 

the evidence suggests volatility actu- 
ally falls. 

Other criticisms ctf the methodology 
are somewhat undermined by the fact 
that some aggressive investment 
are l ini ng gtnrfiflr techniques to 
price their risks. 

If Mr Marsh's case that there are 
excess returns looks strong, it is less 
clear what should be done. The 
authorities could simply force a reduc- 
tion in the flat rate, though that would 
still mean strong issuers were sub- 
sidising the weak. Issuers themselves 
COOld haggto with frhfltr advisers and 
threaten to go elsewhere. In practice, 
they do not because they are afraid 
that their plans will leak out But 
maybe the conventional wisdom that 
impending rights issues must be kept 
secret needs to be challenged. 

Siemens 

Given the opacity of Siemens’ 
accounting, it is hard to say exactly 
what caused the worse than expected 
foil in p re-extraordinary profits in the 
year to endSeptember. But the figures - 
undoubtedly reflect poor performance 
on its enormous investment portfolio, 
as well as continuing losses at Nlxdorf 
and mounting price pressures in tele- 

ami m i niraiHnm a. 

(heater segmental disclosure - due 
for the first time in December - will 
focus the spotlight on the group’s 
structural and operating weaknesses. 
The details wifi hi ghlight the fact that 
tough rationalisation is necessary if 
Sftgnuroi is to improve its lamftnfaihle 
earnings performance and restore its 
international competitiveness. So for, 
its approach to cost-cutting and 
restructuring looks kid-gloved com- 


pared with that of international com- 
petitors or even other large German 
fn d’i'rt ri ff? c o mp ani es The number of 
domestic employees fell a modest 7 per 
cent in the past financial year. The 
decision to sell the US pace-maker 
business earlier this year was a step 
towards defining core businesses, but 
full-scale restructuring looks as dis- 
tant as ever. 

siatTwwa suffers from the sheer scale 
of its liquid resources. They cushion 
the group from the pressures. fell by 
less well-padded groups. The 
unchanged dividend shows that Sie- 
mens js not e rmtepn plating giving the 
money to shareholders. Investors, for 
their part, should continue to avoid 
the stock until there are dearer signs 
that is gHtiing to grips 

with Siemens’ notoriously stodgy cul- 
ture. 

Cable & Wireless 

Cable & Wireless has traditionally 
enjoyed a premium rating. Investors 
have been impressed with Its strategy 
'of frnirfng cash from its enormously 
profitable Hongkong Telecom subsid- 
iary and reinvesting it in st art-up ven- 
tures elsewhere. Ye s terd a y's bad news 
from Mercury Communications, 
C&Ws hugest such investment by for, 
raises doubts over whether the pre- I 
mium is justified any longer. 

The cost cutting announced yester- 
day is certainly necessary to revive 
Mercury's fortunes; any regulatory 
relief cm the lees it pays BT for chan- 
nelling calls over the larger company's 
network would also be a bonus. But 
neither will be sufficient to raise Mer- 
. airy's retu rn on capital, which fell to 
around 1L5 per cent on an annualised 
basis in the half year to emd-Septem- 
ber, to an adequate level While Mer- 
cury puts its house in order, BT is also 
cutting costs and new competitors are 
ente r in g the wnarin* targeting Mercu- 
ry's best customers. 

If C&W is unable to earn good 
returns cm cash recycled from Hong- 
kong Telecom, a central factor in pres- 
erving its p re m i um rating wifi be the 
possibility of breaking op the group. 
Once the market value of C&Ws S7J5 
per cant stake to Hongkong Telecom is 
subtracted, there is little value left in 
tiie rest of the group's operations. The 
' miflg with this argument is not simply 
that C&Ws management has set its 
face firmly a gamat such imhimfiHng . 
Any attempt to off-load the Hongkong 
Telecom stake might so depress its | 
price as to defeat the purpose of the 
exercise. 


This announcement appears as a mallfir of record only; 


& 


EFFERSON 


CROUP pic 


has acquired the 


Paper & Paper Packaging 
Operations 


rrrrrm 

SAINT-GOBAIN 


The undersigned initiated the transaction and acted as exclusive 
financial adviser to Jefferson Smurfit Group pic in the acquisition. 



Bankers Trust International PLC 


Member ol£a=A. 


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AT&T 

20 

Ingham 

26 

Air France 

16 

Irish Life 

2a 13 

Air Inter 

16 

KLM 

16 

Ahtoura 

29 

Lflco 

20 

Alcatel Alsthom 

19 

Lippo Bank 

23 

Alcatel-SEL 

18 

Mercury CommunUona 

19 

Alcoa 

22 

Metall MMng 

22 

Amersham Inti 

26 

Murray Emerging 

26 

BS Group 

13 

Nedcor 

23 

Baric Umwn IMaaional 

23 

News Corporation 

23 

Barclays 

19 

NovoNortlsk 

20 

Barr&Walace 

26 

dusker Oats 

22 

Blbby(J) 

26 

FtFS Irrds 

28 

Bunzf 

29 

Racal Electronics 

29 

Buflngton Northern 

22 

Rsunert 

23 

Cable & Wireless 

28, 19 

Reuters 

13 

Carfrie 

28 

SA Breweries 

23 

Casinos Austria 

23 

SAS 

20 

Chamberlin & Hill 

29 

Santa Fe Pacific 

22 

China AlrDnas 

23 

Scottish Power 

29 

Co-op Bank 

20 

Scottish Value Tst 

29 

Coal Irtvs 

29 

Seat 

29 

Commercial Union 

20 

Shionogi 

23 

Cr&dit Lyonnais 

19 

Siemens 

19 

DaUchl 

23 Snapple Beverage 

22 

Deutsche Baric 

19 

Takeda 

23 

Electrocomponents 

27 

Thom EMI 

29 

Electrolux 

19 Tiger Oats 

23 

F&C Emerging Markets 

26 

UBS 

19 

Federated Stares 

22 

Ugland Inti 

27 

Fenner 

28 

Union Pacific 

22 

Fujisawa 

23 

VUfiera 

29 

Glaxo 

28 

Woffington U’writing 

28 

Hagemeyw 

20 

Wlenerberger Baust 

20 

Hambro Insurance 

27 

Yamancuchi 

23 

Hydro inti 

26 

Yates Who Lodges 

28 

Market Statistics 

fArnual reports sendee 

32-33 

Foreign exctanne 

36 

Benchmark Govt bonds 

2G 

Gits prices 

a 

Bond lutures and options 

25 

LlfTe equity options 

31 

Bond prices and yields 

25 

London stare sendee 

32-33 

CommodOas prices 

30 

London trail options 

31 

Dividends arnxnced. IK 

28 

Managed funds sendee 

34-35 

EM5 currency rates 

38 

Money markets 

38 

Eurobond prices 

a 

Hew Ml bond issues 

a 

Fixed interest intflces 

a 

Sew York share sendee 

38-38 

FT-A Wald bidces Back Pm 

Iterant Issues, ML 

31 

FT Gold Mnes index 

31 

Short-term rct rates 

38 

FTASMA kM bond sve 

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IS Merest rates 

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FINANCIAL TIMES 


COMPANIES & MARKETS 


©THE FINANCIAL TIMES LIMITED 1994 


Thursday November 10 1994 


IN BRIEF 


AT&T in Mexican 
joint venture 

AT&T, the US telecommunications group, is to form 
a $lbn joint venture with Grupo AJUa, a Large Mec- 
can industrial conglomerate, to provide telecommu- 
nications services in Mexico. Page 20 

Quaker in trendy marriage 

The marriage between 103-year -old Quaker Oats, 
the US cereal manufacturer famnns for porridge, 
with Snapple Beverage, a trendy soft drink com- 
pany. sees Quaker becoming market leader in the 
three fastest-growing beverage segments in the US. 
Page 22 

Union Pacific seeks to derail Md 

The takeover battle for Santa Fe Pacific, one of the 
biggest US railway companies, yesterday took a 
new turn after Union Pacific, the hostile bidder, 
produced a surprise tactic in an attempt to out- 
manoeuvre Burlington Northern, the friendly 
suitor. Page 22 

Associates Hft News Carp 15% 

News Corporation, Rupert Murdoch's international 
media group, has announced a 15 per cent rise in 
net profits to A8301m (US$230m) for the September 
quarter, helped by a 43 per cent increase in earn- 
ings from associated companies and a lower net •• 
interest bQL However. Australian and UK newspa- 
per interests were fiat Page 23 

Cast cuts help Japanese (truss 

Cost-cutting and firm sales of high-margin drugs 
poshed up earnings at leading Japanese drug com- 
panies for the first six months to September in spite 
of weak growth in overall sales. Page 23 

Japan and Europe restrain Amarsham 

A disappointing performance in Japan and conti- 
nental Europe limited first-half profits growth at 
Amersham international, the UK health science 
group. Pre-tax profits for the six months to Septem- 
ber 30 rose 13 per cent to £19.6m ($32m) on sales up 
6 per cent Page 28 

Barr board warns of threat to franchises 

The board of Barr & Wallace Arnold Trust, whose 
voting shareholders are split by a family feud, has 
warned that the motor side of the UK group could 
lose Us distribution franchises, if rebel shareholders 
vote down its proposals. Page 26 

Electrocomponents rises 14% 

Electrocomponents, the UK electronic, electrical 
and mechanical components distribution group, 
lifted interim pre-tax profits 14 per cent to £35 -5m 
($58m). Page 27 

Carlisle completes its transformation 

Carlisle Group has completed its transformation 
from a UK financial services company to a property 
group with the announcement of a £14. 4m (g24m) 
placing and open offer to help fimd £29m of prop- 
erty purchases. Page 28 

Morgan Stanley cuts HK portfolio 

Morgan Stanley Asia has cut its allocation of Hong 
Kong equities to 35 per cent from 40 per cent in Us 
Asia-Pacific model portfolio. The move came less 
than a week after HG Asia (Singapore) also recom- 
mended investors to trim allocations in Hong Kong. 
Back Page 

Companies In this Issue 


Restructuring costs hit Siemens 


By Christopher Parices 
ki Frankfurt 

Siemens. Germany's leading 
electrical and electronics group, 
is to pay an unchanged DM13 div- 
idend despite an unexpectedly 
sharp profits setback in the year 
to the end of September. 

Net eamings before extraordi- 
nary items fell 17 per cent to 
DM1.65bn (Sl.lbn) because of 
higher restructuring charges, 
increased price competition in 
key operating sectors, and rela- 
tively weak investment income, 
the group said yesterday. 

However, the DM344m proceeds 
of the sale of a heart pacemaker 


Earnings fall 17% as power generation and telecoms 
operations face weaker demand in eastern Germany 


subsidiary raised total net profits 
by 1 per cent to DMLSSbn. 

Executives had warned earlier 
Of a maximum decline Of up to 15 
per cent. 

Although yesterday's prelimi- 
nary figures gave no earning s 
breakdown, recent statements 
have suggested that core divi- 
sions - including pu blic te lecom- 
munica toons and the KWU power 
generation subsidiary - have 
been squeezed especially hard by 
international price competition 


Alcatel Alsthom 
acts to cut back 
German losses 


By John HkkSng In Paris 

Alcatel-SEL. the German 
subsidiary of Alcatel Alsthom, 
the French telecoms, transport 
and en gineering - group, yesterday 
announced substantial restruct- 
uring measures aimed at stem- 
ming losses which have shaken 
its parent company. 

The announcement coincided 
with another blow to Alcatel Als- 
thom. Mr Jean-Claude Leny. 
chairman of Framatome, 
revealed that the French govern- 
ment had decided against the 
planned privatisation of the 
jmclear power plant group. 
Alcatel Alsthom had lobbied hard 
to take control of the company, 
in which it has a 44 per cent 
stake. 

Alcatel-SEL said it p lanned to 
cut 5,300 jobs, almost one quarter 
of the workforce, by the end of 
1995. Two plants, at Mannheim 
and Rochhtz are to dose. 

The moves are aimed at curb- 
ing losses which are expected to 
total about DMSOOrn ($20lm) this 
year at the operating leveL “We 
are losing about DMlm a day," 
gairi Mr Gerhard Zeidler, chair- 
man of Alcatel-SEL. Provisions of 
between DM20 Dm and DM300m 
will be required this year to 
cover losses in 1994. A return to 
profit is not expected until 1996. 

The heavy losses reflect diffi- 
culties faced by suppliers of tele- 
communications equipment in 
the German market Orders from 
clients such as Deutsche Tele- 
kom. the national telecoms oper- 
ator, have fallen, while prices 
have been hit by increased com- 
petition in the sector. 

The deterioration in the mar- 
ket reflects structural problems, 


according to industry analysts. 
Telecoms investment in eastern 
Germany has slowed, while the 
shift by Deutsche Telekom to 
increase competition in the 
award of contracts has under- 
mined the position of traditional 
suppliers such as Alcatel and sie- 
mens. Industry analysts in Paris 
said that the situation had been 
aggravated by the slow response 
by Alcatel-SEL. 

The problems of the German 
unit are one of the biggest set- 
backs to confront Alcatel Als- 
thom, which has grown rapidly 
over the past decade to become 
one of France's largest and most 
profitable industrial groups. The 
losses in Germany were one of 
the principal factors behind a 
warning in July that profits at 
the French group would foil by 
about 40 per cent this year from 
FFr7.06bn (81.37b n) in 1993. 

Industry observers in Paris 
described yesterday's measures 
as rigorous. “It is encouraging," 
said an analyst The- restructur- 
ing plan, however, coincided with 
the setback concerning 
Framatome. Mr Leny, 
Framatome chairman , said that 
the government bad decided 
against privatising the group 
because it would undermine the 
structure of the French nuclear 
industry and could lead to its dis- 
mantling. 

Alcatel Alsthom yesterday 
rejected such a possibility, but 
admitted that the planned opera- 
tion had become deadlocked dur- 
ing the summer. The principal 
obstacles involved the price of 
taking a controlling stake and 
concerns expressed by 
Framatome’s other partners, 
including Siemens of Germany. 


and the end of the demand boom 
caused by German unification. 

Group sales, up 10 per cent 
abroad and down 4 per cent at 
home, rose an aggregate 4 per 
cent to DM84.6hn. 

Orders increased 5 per cent 
thanks solely to a 15 per cent 
increase in foreign demand, 

which accounted for 60 per cent 
of the total bookings. 

Domestic orders, which were 6 
per cent lower after six months, 
foil 7 per cent over the full year. 

■ Telecoms group 

C&W to 
shake up 
Mercury 
operations 

By Paid Taylor In London 

Cable & Wireless, the UK 
telecommunications group, yes- 
terday announced a “substantial 
cost and head-count reduction 
programme” at its UK-based Mer- 
cury rv »nrmiTnif-siHrmg subsidiary 
while reporting an 11 per cent 
rise in interim pre-tax pr o fit s. 

Lord Young, chairman, 
declined to be drawn on the scale 
of the likely job cuts. However, 
the National Communications 
Union said it believes job losses 
at Mercury will total around 1400 
and analysts suggested that up to 
2,000 of Mercury's 11,400 jobs 
could be at risk. 

Pre-tax profits increased In Una 
with expectations to £567m 
(89293) in the six mmrfhe to Sep- 
tember 30 from £50Tm a year ago 
on turnover which grew by 9 per 
cent to £233bn (£2.54bn.) The 
shares closed down 7p at 392p. 

The results were underpinned 
by the continued strong perfor- 
mance of Hongkong Telecom 
which is 573 per cent owned by 
C&W and contributed £4l7m 
(£365m) to overall operating prof- 
its of £592 ul 

Improved group profits came 
despite a surprise £3m decline in 
first-half operating profits at Mer- 
cury which foil to £96m on turn- 
over up 12 per cent at £797m. 

Mercury’s decline came despite 
a 21 per cent increase in call vol- 
umes and a 50 per cent increase 
in customer lines to 2.1m. 
Growth in residential customer 
lines was particularly strong at 
54 per cent 

Lord Young said that although 


Foreign demand which was 21 
per cent up at halfway, also 
appeared to slow in the second 

half 

The statement blamed weak 

demand for hea vy plan t and elec- 
trical equipment for the drop in 
domestic orders. Most foreign 
growth came from the Americas 
and the Asia-Pacific zone. 

Best results appeared to have 
been posted by divisions such as 
automotive components and rail- 
ways which reported sales 


Increases of 16 and 21 per cent 
respectively. ■ 

The lossmaking computer sub- 
sidiary, Siemens Nixdorf, 
recorded a 2 per cent turnover 
decline although domestic orders 
were reported to have increased 
for the first time. 

Turnover ftt the Qsramr li ghting 
business, bolstered by the first- 
time consolidation of the US Syl- 
vania group, rose 82 per cent to 
DM5Abn. 

The group cut 21300 jobs dur- 
ing the flu 3 ™* 1 * 1 year, of which 
17,000 ware lost in Germany. The 
number of part-time workers rose 
SO per cent _ 

Lex, Page 18 


SHEERFRAMF 

Specified 

Worldwide 

HgiAIMesUMted 

Tl Tri: 0773,852311 

Electrolux 
profits 
Hw surge to 
= SKrSbn 


to cut jobs ■ Further growth in HK 

Merbuiy staffs after 


European banks forced to change course in US 


T hese days, it seems every 
European bank wants to 
be in the US Investment 
banking business. Bank execu- 
tives from Deutsche Bank. Credit 
Lyonnais and Union Bank of 
Switzerland, among others have 
talked this year about growing 
their trading and deal-making 
skills to complement their lend- 
ing and foreign exchange busi- 
nesses in the US. 

Barclays is no exception. After 
a disastrous foray into comers of 
the US financial market in the 
1980s. the UK bank may have 
been pulling in its horns recently 
- earlier this week, for instance, 
it said it was in talks to sell its 
profitable US asset-based tending 
business. But it is now also focus- 
ing ihi growth. 

No hank with pretensions to 
serving big companies can afford 
not to have a substantial pres- 
ence in New York, according to 
Mr Martin Taylor, Barclays chief 
executive. “The investment bank- 
ing business internationally 
demands dollar capability.” be 
said. 

Also, techniques and skills 
developed in the US derivative 
and other finan cial markets are a 
driving force around the world. 
“New York is the centre of imagi- 
nation and ideas in the [capital] 
markets,” said Mr Taylor. 

With a number of foreign 
hanks pursuing the -same goal - 
and some of the US's own com- 
mercial banks moving into 
investment banking - is there 
enough business, let alone 
enough skilled traders and deal- 
makers. to go around? 

Like other foreign and US Insti- 
tutions. Barclays lent liberally to 
US companies at low margins 
during the 1980s. hoping to forge 
relationships which would yield 
more profitable business later. It 

didn’t work. 

Mr Taylor now refers to that 
era as one of “extrenff promiscu- 
ity”. "Nobody built any particu- 
lar loyalty or any particular 
strength.” 

There were also bad credit 
judgments. Last year, Barclays 


Barclays learns 
lessons from a 
promiscuous past 


took a £346m (S567m) charge 
against its US loans. £lbn of 
which were classified as non-per- 
forming at the end of 1993. lake 
others, it was caught out by 
excessive property lending 
Now, the bank is busy cutting 
the number of companies it ser- 
vices in the US. "Banks are get- 
ting back to the idea of having 
fewer and deeper relationships,” 
said Mr Taylor. At the start of 
1998, Barclays did business with 
900 US companies: that number 
has been cut to around 200. 

It has also pulled out of a range 
of retail or small business 
finance businesses entered dur- 
ing the 1980s. Besides the asset 
finance company, virtually the 
only one left is Barclays Ameri- 
can Mortgage, which services 
mortgage loans. 

I n the past three years, these 
mistakes - and charges for 
shedding excessive infra- 
structure - have cost the hank 
Q.lbn. The continuing part of its 
business, by comparison, made 
profits of OE8m last year. 

Barclays is trying to graft an 
investment hanking 1 business on 
to what is left In this effort it 
has some thing* working in its 
favour. Us came still scores high 
marks for recognition In the US 
and its reputation has barely 
been tarnished by problems in 
the UK Mr Taylor calls this the 

"halo effect". 

The era of expansionism hag 
left the bank with a base of cus- 
tomers on which it can build. 
“However expensive an entry it 
was, we have got the relation- 
ships," said Mr Taylor. It was one 
of six backs, and the telly non-US 


one, which committed $500m 
each to back the (ultimately 
unsuccessful) bid for Paramount 
Communications by QVC. Also 
this year it co-arranged a $325m 
financing to back a merger erf two 
cellular companies to form West- 
ern Wireless. 

Mr Taylor calls commitments 
like that to QVC "the strategic 
use of the [bank's] balance sheet" 

- providing the bridging finance 
or underwriting to support a big 
corporate transaction. In future, 
he says, Barclays plans to use its 
capital In this way. rather than 
take on loan assets. 

Barclays will have to avoid the 
sort of temptations which led it 
astray before. 

Mr Taylor seems wary of get- 
ting drawn into new areas such 
as US equities. "The market Is 
very well supplied with strong 
players at the moment." 

The h ank will also have to 
rebuild morale and management 
in the US. That process may not 
be smooth: while Mr Richard 
Webb, head of the US bank, has 
handled the clean-up smoothly, 
the two joint-heads of the invest- 
ment banking business in New ; 
York — Mr John S utherland and 
Mr Malcolm LeMay - have left. 

Mr Taylor earlier this year pro- 
fessed hfmsaif happy with the US 
management But he added: “The 
challenge for Barclays in manag- 
ing its US operations is how you 
move that management group 
over the next few years when 
you're coming out of a tumroqnd 
phase into a development phase." 


Richard Waters 


.. CriMeancnwraloiB 
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Merc ury wintinTvw to gate mar- 
ket share it had been hit by the 
effects of regulatory change 
which had resulted in pricing 
pressure and niha tanHaliy hi g her 
Access Deficit Charge payments 

to British Tpltr wnmiiTriratin nK 

“Clearly we are disappointed 
by Mercury's financial perfor- 
mance but we do not intend to 
rely on regulatory change alone 
to ameliorate the position," be 
said. "We are therefore restruct- 
uring Mercury which wfll enable 
us to introduce a substantial cost 
and headcount reduction pro- 
gramme.” 

Lord Young said details of the 


restructuring measures would be 
announced within the next 
month by Mercury's new chief 
executive, Mr Duncan Lewis, 
appointed aarbw this week. 

Despite the setback at Mercury. 
Mr James Boss, C&Ws chief 
executive. Insisted the group's 
results, showing a rise in operat- 
ing profit of 17 per cent, "were a 
good performance m arred only 
by the difficulties of Mercury*’. 

Earnings per share rose to 1L9 
(H Ip ) and Art interi m di vidend of 

2.83p (2.6p) per share was 
declared, a9 per cent increase on 
last year. 

Lex, Page 18; Details, Page 26 


By Christopher Brown-Hurnea 

hi Stockholm 

Cost-cutting, big capital gains, 
and. west European economic 
recovery powered a seven-fold 
rise in profits . at Electrolux in 
the first nine months. 

Income at the world’s biggest 
manufacturer of household 
appliances after financial items 
rose to SKrS.OShn (S890m) from 
SKr712m. 

The sale of three non-core 
industrial units produced capital 
gains of SKr2.77bn and boosted 
operating income to SKr€-26bn 
from SKr2.0lbn. 

Excluding the sale, operating 
income was 73 per wait highs: at 
SKr3.48bn while income after 
financial items was up 224 per 
cent at SKz&Sibn. Bantings per 
share climbed to SKrl9.fi from 
SKrS.O. Electrolux B shares 
dosed SKr9.5 higher at SKr36&5. 
.’ Mr Leif Johansson, chief exec- 
utive, said the underlying 
i m pr o vement was mainly due to 
the group’s- restructuring and 
cost-cutting programme which 
has boosted productivity by 10 
per cent over the last year. 

But he said market conditions 
in Europe and the US were also 
better, reflected tn an 8 per cent 
underlying increase in sales to 
SKr79Jtm.; - 

The group said there were 
ci ptg that the ]mm of demand 
increase tn North America was 
slowing, while momentum was 
Increasing in most European 
markets. 

"We are also starting to see 
some price increases in the Euro- 
pean household appliance mar- 
ket,” Mr Johansson said, 
although he noted that the 
group's own raw material costs 
wore also rising. 

Sales of household appliances 
rose by 9.2 per rant to 
SKr47.6bn. 

The. group's three, other divi- 
sions, commercial appliances, 
outdoor products and industrial 
products, also improved operat- 
ing income. 

In the third quarter, group 
income after financial items 
climbed to SKr650m from 
SKrI07m after an 8 per cent rise 
in underlying sales to SKr24^bn. 
There was a stronger perfor- 
mance from the group's commer- 
cial appliances division, which 
suffered from weak demand in 
the first six mimflu. 

Following its purchase of 
AEG’s household appliances, 
Electrolux has shifted its focus 
to Asia and China where it alms 
to double annual sales to nearly 
SKrlObn In five years. 



1 

i i 


I U m 


— = — 





UNCIAL TIMES THURSDAY NOVBMB^.fog,, 


INTERNATIONAL COMPANIES AND FINANCE 




AT&T in $lbn Mexican venture 


By Damian Fraser 
in Mexico CHy 

AT&T, the US tele- 

co mmuni cations group, ts to 
form a $lbn Joint venture with 
Crupo Alfa, a large Mexican 
industrial conglomerate, to 
provide telecommunications 
services in Mexico. 

Alfa will hold 51 per cent of 
the venture and AT&T 49 per 
cent. The jointly-owned com- 
pany is expected to apply for a 
Licence to offer long-distance 
telephone services in Mexico, a 
market which will be opened 
up to competition Cram Janu- 
ary 1997. 


Hagemeyer 
raises FI 90m 
in placement 

Hagemeyer. the Dutch 
products and food trading 
group, has raised FI SOm 
($519m) of new capital in a pri- 
vate placement of 677,617 ordi- 
nary shares. AP-DJ reports. 

The issue, announced earlier 
this year, will increase the 
total number of shares out- 
standing by 4.7 per cent. 

The Naarden-based group 
also announced it had placed a 
545m, five-year, floating-rate 
exchangeable subordinated 
note issue with Dutch institu- 
tional investors. The notes, 
designed to improve the struc- 
ture of debt rather than 
increase the burden, are 
exchangeable into minority 
equity at the option of Hage- 
meyer. 

“Both transactions fit Hage- 
meyer's financial aim to keep 
its shareholders' equity at a 
level of between 25 and 30 per 
cent of balance sheet total, 1 ' 
Hagemeyer said. 

Its Hong Kong parent com- 
pany. First Pacific, participated 
in the share offering to hold its 
stake unchanged at 50.04 per 
cent. 

The remainder of the newly- 
issued common shares have 
been placed with a small num- 
ber of foreign and domestic 
investors, who paid a price at 
market average. 

Hagemeyer, which has 
expanded this year through the 
takeover of UK electro-techni- 
cal wholesaler Newey & Byre 
and a joint venture in Asia, 
said it expected earnings per 
share to rise in 1994, from last 
year’s FI 11.37. 


Mexico's telecommunications 
market is valued at about $7bn 
a year. 

AT&T said its venture with 
Alfh would offer a hill range of 
telecommunications services, 
beginning in 1995, depending 
on regulatory approval by the 
transport and communications 
ministry. 

It said the $lbn investment 
would be spread over between 
four and six years. 

AT&T is the fourth large 
US telecoms carrier to 
announce ventures in Mexico 
this year. 

MCI has agreed to form a 
company with GF Banacci, 


Mexico's largest financial 
group; Sprint has linked with 
I us cell, a cellular company; 
and GTE has joined forces with 
GF Bancomer, Mexico's second 
largest bank, and Visa, a large 
Mexican company. 

All are hoping to enter 
the lucrative long-distance 
market. 

The alliance between Alfa 
and AT&T may raise questions 
about the long-term strategy of 
Tefefonos de Mexico (Telmex). 
the current monopoly long- 
distance and local carrier. 

Telmex had been widely 
expected to form a venture 
with AT&T, with which it 


has close business relations. 
Telmex’s share price tell 
mid-morning on news i*f 
the announcement. 

Alfa, a Monterrey-based con- 
glomerate with interests in 
steel, food and petrochemicals, 
posted sales last year of 8b n 
pesos ($2.3bn) and income of 
2lim pesos. 

One of the company's largest 
minority shareholders is GF 
Lnbursa, a financial group con- 
trolled by Mr Carlos s lim, the 
chairman of Telmex. GF 
lnbursa has played down 
rumours that it might seek to 
launch a takeover bid for 
Alfa. 


Commercial Union advances to 
£305m on UK non-life revival 


By Ralph Atkins, 

Insurance Correspondent 

Commercial Union, the large 
UK composite Insurer, yester- 
day reported pre-tax profits up 
£165m ($m.6ta) at £305m for 
the first nine months, helped 
largely by the revival in the 
UK non-life insurance sector. 

Mr John Carter, chief execu- 
tive, said UK underwriting 
margins were "still looking 
favourable" with claims rela- 
tively low and many premiums 
stable or rising. But he 
acknowledged that trading 
conditions in insurance were 
unlikely to remain as good in 
the next few years. 

Underlining the extent of 
competition - particularly 
from direct telephone-based 
insurers - the company 
reported that the number of 
private motor vehicles insured 
by it had fallen 18 per cent 
over the past year. 

The results were broadly in 


line with expectations and the 
group’s shares ended 
unchanged at 543p. 

In continental Europe, 
strong growth in general Insur- 
ance premiums helped increase 
operating profits in the Nether- 
lands to £64m from £53m, but 
elsewhere CU made an operat- 
ing loss before taxation of £6m 
against £24m. 

Contributions from the US 
were hit by bad weather and 
catastrophe claims. US operat- 
ing profits before tax fell to 
£44m from £50m. 

Mr Carter said UK growth 
had been affected by a tough 
market for pension products 
but he forecast that the Securi- 
ties and Investment Board's 
proposed programme for 
reviewing past sales of per- 
sonal pension policies would 
not have a material effect on 
its statutory life profits. 

For the group as a whole, 
profits from the life business 
increased to £94m from £86m 


Growth in new life annual pre- 
miums in continental Europe 
was partly offset by lower UK 
sales of individual life and pen- 
sion products. 

Operating results for general 
insurance jumped to £2G2m 
from £57m. Total premium 
income In the first nine 
months was £4.50bn against 
£4_49bn. 

The results were the first 
since CU acquired on October 6 
the French insurer Groupe Vic- 
tolre, which will be included in 
final-quarter results. 

Shareholders’ funds at Sep- 
tember 30 totalled £2.1bn com- 
pared with £L5bn at December 
31 1993. The drop largely 
reflected the poor performance 
of bond and equity markets. 

Operating ratio in the UK - 
which measures claims, com- 
missions and expenses as a 
percentage of premiums - 
amounted to 97 per cent in the 
nine months, against 104 per 
cent 


Novo 
Nordisk 
falls 6% to 
DKrl.2bn 


Cuomo’s defeat hits Lilco shares Water group loan 


By Richard Tomkins 
in New York 

Shares in the Long Island 
Lighting Company, a private- 
sector US electricity company, 
tumbled by $l l A to $l6'/i in 
early trading, a decline of more 
than 8 per cent, following the 
defeat of Mr Mario Cuomo, the 
state's Democratic governor. In 
the US mid-term elections. 

Last month Mr Cuomo pro- 


posed to buy out Lilco's share- 
holders at $21.50 a share and 
take the the company into 
state ownership in an attempt 
to cut electricity bills. 

However, the plan looks 
unlikely to go ahead under 
New York’s new Republican 
governor, Mr George PatakL 

Mr Cuomo said Lilco’s elec- 
tricity rates, the highest hi the 
US, would fell by 10 per cent if 
the company were nationalised 


because it would no longer 
have to pay federal taxes or I 
shareholder dividends. 

Later this month Lilco's elec- 
tricity rates are due to be 
reviewed, but the New York 
Public Service Commission, 
the state body that sets elec- 
tricity rates. Is not expected to 
permit any Increase. 

Shareholders fear the result 
will be declining company prof- 
its and a cut In the dividend. 


General Utilities, holding 
company for the UK water 
company assets of Compagnie 
Generate des Ganx of France, 
has returned to the syndicated 
loan market with a £120m 
revolving credit facility 
arranged by Chemical Bank, 
writes Martin Brice in Lon- 
don. 

Chemical Bank said the loan 
would replace a £l60m deal It 
arranged in 1991 for the com- 
pany. 


Profits recovery at SAS 
continues in third period 


! By Hilary Barnes 
in Copenhagen 

Pre-tax profits at Novo 
Nordisk. the Danish pharma- 
ceuticals and industrial 
enzymes producer, fell by 6 
per cent to DKrl.2-ibn ($2llm) 
from DKrl.32bn in the first 
nine months of the year. The 
group's net profits fell 7 per 
cent to DKr 934m from 
DKrlbn. 

Earnings per share were 
reduced to DKr24.50 from 
DKr26.66 Last year. Bnt the 
group forecast tbat pre-tax 
earnings for the foil year will 
be DKrl.92bn-DKrl.97bn, com- 
pared with DKrl.86bn last 
year. 

A 12 per cent increase in 
sales so Tar this year was 
eclipsed by a faster growth in 
costs, which reflected expan- 
sion in production capacity, 
the group said. 

Sales were up to DKrSA4bn 
from DKr8.84bn. including a 
rise of 13 per cent by the insu- 
lin-producing healthcare divi- 
sion to DKr6.69bn and by 11 
per cent to DKx2.64bn in the 
industrial enzymes. 

Costs rose 16 per cent to 
DKrS-OSbn. including tax and 
net financial items, with the 
latter increasing DKr31m to 
DKr 1 35m. 

The group said it had prob- 
lems meeting demand for some 
types of insulin, used for dia- 
betic care, in the US as a 
result of a temporary closure 
of a Danish plant 

In addition, there had been 
delays in bringing a new plant 
in the US on stream due to US 
Food and Drug Administration 
requirements. 


) By Christopher Brown-Humes 
1 in Stockholm \ 

\ 

The recovery at Scandinavian 
Airlines System fSAS) contin- 
ued in 1 the third quarter, 
enabling the group to report 
pre-tax profits of SKrlJMbn 
tSl70m) for the first nine, 
months after a SKrl.l3bn loss 
in the same 1993 period. 

The group, half-owned by the 
governments of Sweden, Den- 
mark and Norway, benefited 
from cost-cutting, a lower debt 
burden and a positive trend in 
its core airline business. Dis- 
posal of non-core operations 
yielded SKrS29m in capital 
gains. 

The airline was hit by 
SKrToOm in restructuring costs 
and a higher aircraft deprecia- 


tion charge after a change of 
accounting methods. 
Operating income Tell 

slightly to SKr28.3bn from 
SKr29-2bn. hut costs fell fur- 
ther to leave the group *?■ 
operating profit before depred- 
ation of SKA56bm compared 
with SKrL82bn. 

The figures benefited from a 
7 per cent currency-adjusted 
rise in traffic revenues and 
higher yields. "The traffic 
increase was felt mainly on the 
company's European and intra- 
Scandinavian routes. 

The group's cost-cutting pro- 
gramme, involving the loss of 
3.000 jobs, is also beginning to 
have an impact 
The third factor in the air- 
line’s revival has been sharply 
reduced interest costs after 


cutting Its jont . debt to 
SKr6-98bn from- SKrl3.89bn 


The balances steel has been 
strengthened bY tne disposal of 
SAS Leisure, «Ho8t'operator, 
SAS Service Pattmfc- a. cater- 
ing unit, and Dh^si Cfeib Nor- 
dic. These generated mere ^an 

SKr3bn in art - 

The -third quarter brought a 
SKr624m pre-tax profitafter 
last year's SKrKOm loss. . . . 

It was the- airiiheV second 
consecutive quarter in the 
black and keeps it on. course 
for its first full-year profit 
since 1389. ■ 

During the past four years, it 
has made losses dua tp: reces- 
sion, fierce competition, heavy 
restructuring costs amt cur- 
rency losses.; 


Austrian building group ahead 


By Ian Rodger In Zurich 

Wienerberger Baustoff- 
Industrie, the Austrian build- 
ing materials group, reported a 
5.7 per cent rise in pre-tax prof- 
its in the third quarter to 
Sch3S6m (536.4m). This was 
mainly due to the strong per- 
formance of its core bricks and 
pipes businesses. 

For the nine months, pre-tax 
profits were ahead 30.7 per 
cent to Schl.02bn and the 
directors have raised their 
profit forecast for the full year 
to Schl.labn, 22.6 per cent 
above the 1993 result 


Sales in the nine months fell 
2Q.6 per cent to ScU7-4bn, 
mainly because of the sale of 
the sanitary fitting subsidiary 
to Wolseley of the UK earlier 
t-fr is year. Exclu ding this dis- 
tortion, sales were ahead about 
10 per cent the group said. 

The loss at the troubled Trei- 
bacher ferro-alloy subsidiary 
was slashed in the third quar- - 
ter to Sch7J8m from SchB&lni, 
in the same period of last year, 
mainly as a result of cost 
reductions. There was a small 
improvement in market condi- 
tions. 

Pre-tax profits of the wall, 


ceiling and roof division 
advanced 5.4 per pent to 
Sch282J5m in the thud quarter, 
while those of the pipe systems 
and sewage technology divi- 
sion jumped 56 per cent to 
SctriSilm. . 

• Lenzing, the world’s largest 
producer of viscose fibres, said 
sales were flat in the first nine 
months of the-' year at 
SchAMbn. excluding thelSS 
sales figures of Gianzstofi, sold 
earlier this year. 

The group, which suffered a 
loss of Sch203m m .1933, said It 
expected a positive result for 
the foil year 1994. 


UK retailer may sell banking arm 


By Ian Hamilton Fazay, 

North of England 
Correspondent 

The sale of part or all of the 
Co-operative Bank is being 
considered by its owner, 
the Co-operative Wholesale 
Society. 

S.G. Warburg, the UK invest- 
ment bank, has been commis- 
sioned to examine selling 
shares in the bank to another 
co-operative financial institu- 
tion. Since last year, contact is 
believed to have been made 
with co-operative banks in 
Canada. Germany, France, Bel- 
gium and Switzerland. 


The CWS board discussed a 
paper on the bank’s future last 
week, but decided to take no 
short-term action. 

The Manchester-based hank 
has only 3,500 employees and 2 
per cent of in the UK retail 
market However, it is strong 
in two niches: “gold” credit 
cards and local government 
accounts. It has also attracted 
customers by refusing to do 
business with companies that 
ft considers insensitive to envi- 
ronmental issues. 

Its asset base was £3.4bn 
($5.4bn) in its accounts for 
the year to January 8, with 
pre-tax profits of £17Km. 


The CWS was founded in 
1863 and set up the bank nine 
years later. As owner of 100 per 
cent of the equity, the CWS 
has to guarantee the bank's 
capital base. Returns on the 
cram invested so far have been 
poor because the bank has had 
to retain profits to keep its 
base strong. 

An alternative recommended 
in last week's board discussion 
paper was to transfer owner 
ship to the Co-operative Insur- 
ance Society, although this 
would be unlikely to be 
approved by the Bank of 
England, the banking regula- 
tor. 


^ ?r.,: 

vv> .?■ r 

.M:. :i 

l- "■ -v. •' " V- 


4* i: 


This announcement appears as matter of record only 


October 1994 



ENGIL SGPS, SA 


PTE 6,792,120,000 


Private Equity Offering 


Banco Santander de Negocios Portugal 

Banco Portugues do Atlantico 

CISF Banco de Investimento 
Caixa Geral de Depdsitos 
Banco Totta & Azores 


& 


Santander Investment 


BARCLAYS 


BARCLAYS BANK PLC 
U.S. $3 30,8 3 0,000 

Junior Undated Floating Bate Notes 


Notice is hereby given that the Rate of Inrerest 
for the Interest Fteriod from 10th November, 1994 to 
10th May, 1995 is 6.375 per cent, per annum 
and that on 10th May, 1995 the amount of 
interest payable in respect of each U.S-S5,000 
principal amount of the Notes will be U-S.$160.26 
and in respect of each U.S.$S0,000 principal amount 
of the Notes will be U.S-S 1,602.60. 

Barclays de Zoeta Wedd Timing 
Agent Bank 


CREDIT LYONNAIS 
YEN 60,000,000,000 
S'LPER CENT. BONDS 
DUE 1999 

Bondholders are hereby 
informed that 
Credit Lyonnais will 
redeem the total amount of 
the outstanding bonds at the 
principal amount thereof on 
I4th December 1994, as 
permitted under Condition i 
3(B) of the Terms and 
Conditions of the Bonds. 
The Fiscal and Principal 
Paying Agent 

yU CREDIT LYONNAIS 


IWBi 


Birmingham 

Midshires 

Guikhnjt-. <uy 


5150,000,000 
Floating Rate Notes 1999 

The notes will bear interest at 
6.3125% per annum for the 
intemst period $ November 1994 
to 8 February 1995 Interest 
payable on 8 February 1995 
wilt amount to SJ59. It per 
StO. 000 note and 51,591. 10 per 
SltXI. 000 note. 

Agent: Morgan Guaranty 
TVust Company 


LOPEZ, INC. 

‘ ilar.*l»~ulrd m ihf ftrpMu ■•nhr /-Wi/Y'-r. . if* hnmrJ hdfwht) I 

Exchange Offer 

To Eligible Holders or the 
P1.2 49,960, 666 

Perpetual Convertible Bonds rBondVi 
of Ben pres Holdings Corporation r Bmpra"! 
of the right to exchange their Bonds for 
Global Depositary Rccc.pts n ;ur*“i 
in respect of certain SPUR rights i -SPURO 

granted by Lopez, Inc. ri^vz") 

relating to 

common shares of par value P1.00 each cstmrcs. M i 
of Benpres 

Further lo (xcvmin mnounctti nails nslnluig hi du: Kxctiaigi- Oder. *n oggrcgatt 
mom of li JWJ.ISI COR* in re^p-xi of B.W .152 SPUR* granted by 1 j .pcz idning 
lo 278.663.CW0 Shansi have been kuinJ w i(hw djgtMu holders nf Bauds who 
accepte d iht F -xehmge Offer. Janlinc Fleming, ihc Exchange Co-onlrolor. reported 
rtu acceptances woe nxetvcd in report uT uiimsuimcty X&JStt of tU- — 

Bwilv 

Such GDR» arc in addition lu ihe lb.075 JIHQ nrjRs previously bmwd .,■ .,n inae price 
ot USSXLSn coch in report of kyjo7Sd)ni -,PUR.., pani-sd by Uny icbonf! *> 
333,300,000 Shares. 

I hisanitoumememhai hern itsuetlhy th-h,-rt Fleming & I'e.Umnr, I jmtrehtrot 
The Snitriilrs A Fmmrri \inht‘rii\. 

l&hi-.wjiia.WH 


PETROFTNA S.A. 0 

52 rue de ITndustrie- B-1040 Brussels 
T.VA. No. 403.079.441 - R.C. Brussels No. 227.957 

Shareholders are invited to attend the EXTRAORDINARY 
GENERAL MEETING in Brussels, at 52 rue de ITndustrie, 
on November 28, 1994. at 2.30 p.m. (Brussels time), with 
on the agenda : 

1. A recommendation to irrevocably waive, with effect 
from the 1994 financial year, the tax saving resulting from 
the exemption provided by Royal Decree no. 15 of March 
9, 1982, as subsequently modified, and payable to the 
AFV-shares; and to propose the deletion of paragraph 4 of 
article 34 of the Articles of Association in consequence. 

2. To empower the Board of Directors to enforce 
resolutions adopted at that meeting and to determine the 
method of execution thereof. 

The shareholders’ quorum must represent at least half the 
capital. Failing this, a second meeting with the same 
agenda.will be held on December 16, 1994 at 2.30 p.m. 

In anticipation of the first meeting, the holders of bearer 
shares may deposit their shares until dose of business on 
November 23, 1994, in the following institutions : 

Banque Bruxelles Lambert Generate de Banque 
CGER Kredietbank Banque Paribas Belgique 
Banque Naiionale de Paris Credit du Noid 
Banque Internationale k Luxembourg 
Banque Gdndrale du Luxembourg 
Commerzbank Deutsche Bank Dresdner Bank 

Credit Suisse Swiss Bank Corporation A 

Union .Bank of Switzerland A BN- Amro Bank W 

Credito Italiano Barclays Bank (Fenchurch St., London). 

The Board of Directors ** j 

l — r i 

Top Finance (Bermuda) II Ltd. 

(the “Issuer) I 

up to U.S.$95,000,000. 

9.26% Guaranteed Secured Notes Due 2000 
Notice of Redemption 

01 u -®- ® 95 -000.000 outstanding principal amount of the 9.26% 

DewmSoM Sf, 2000 fs3U0d undar 1,10 '"denture dated as of 

1 and Ta * a3 Commsrca Bank National 

Mng oalted/orn*fempitofl at lha option or 
5?.^ 19 ®*' 01 par p* 1 " accrued interest No other Class ot 

NolK^Equiiy issued under the indenture is- subject to this Notice of 

and Including 

Sr ste? 

sS3laSBS S?S=ss 

NOTICE TO POTENTIAL PURCHASERS 
OF 

kassandra mines of 
“HELLENIC CHEMICAL PRODUCTS & 

FERTILIZERS COMPANY SA" 

OF ATHENS. GREECE 

im nS rnmi T' 464 ° r ism/mwo 

mutation of the Call t—l- f uefaujL Mwtihdca. ebe dates of tho 

ESZf ^ M in >« ^ orreriag 

K * a * ndra M ‘"«- '“P« ezccatrao 

105 01 Q> erase, te L 

Frangntb) or Ibc LiqekfaM-, jps™ M«m. John Dcto* mi 

Av.. Alheto 105 57, Grcece. M,. ,30- [-j22.75.7Q. f M: +»r5Sj lif - ^ 



L 





You’re moving a $2 billion portfolio through 11 markets in 11 days. And 
you have zero room for error. 


You’ve had a lot of experience in managing global portfolios, but when your company 

merged with two others, they handed you a $2 billion headache. 

■ — Twenty-three portfolios, three strategies and less than two weeks to rationalise and 

1WS.V > 1 

reinvest them. 

Not a task for an ordinary trading firm. 

That’s why you began by holding a competition for the assignment. And hired the firm 
that did the most unexpected thing. 

Instead of coming to you with a marketing presentation and a troop of people, they 
brought you a solution. A computer-designed model outlining a plan for the entire deal, 
r Trades broken down into manageable pieces that would float through the markets 

' unnoticed. Hedges in place at every turn. Every transaction accounted for. With no cash balances 

at the end of each day. 

^ ^ And a complete pricing breakdown — for you to sign off on and for them to live up to. 

. / You know they’ll come through. 






ICIAL TIMES THURSDAY NQVEMBB^Apj^ 


INTERNATIONAL COMPANIES AND FINANCE 


5 op* 


t* 


Union Pacific in 
surprise new offer 
for Santa Fe 


Improved 
margins lift 
Federated 
to $44.3m 


A $1.7bn marriage that feces a bumpy nae 

Investors have doubts over Quaker Oats’ purchase of Snapple, writes Richard Tomkins 

1 cwilthhum ^irmmi nnrl flhifif PepSlCO” SCDldy ftW ofthe 

T hey make an odd cou- Snapple deal not to Investors 1 taste? SSSSwtAf Quaker Oats, said fact that their colas arelosing 

pie. On the one hand is t jl teerina with the market share to alternative 

Quaker Oats, a 103-year- Quaker Oats (share prices I Oils was m wiH Bhmder-fche man 


By Richard Tomkins 
in New York 


The takeover battle for Santa 
Fe Pacific, one of the biggest 
US railway companies, yester- 
day took a new turn after 
Union Pacific, the hostile bid- 
der, produced a surprise tactic 
in an attempt to outmanoeuvre 
Burlington Northern, the 
friendly suitor. 

Union Pacific put forward a 
new offer worth $3^3bn in rash 
and shares, substantially less 
than Its last offer of $3.8bn. 

However, ft said sharehold- 
ers would get the cash and 
shares immediately instead of 
having to wait a year or 
more while the Federal regula- 
tory authorities considered the 
deal. 

The proposal could prove 
tempting to Santa Fe's share- 
holders because Burlington 
Northern's all-share offer is 
worth less - $3.2bn - and 
would have to await regulatory 
approval. 

Santa Fe, which bad rejected 
Union Pacific's two previous 
offers, yesterday said it was 
studying the latest proposal 

The bids will be put to 
a shareholder vote on Novem- 
ber IS. 

Until now, Union Pacific's 
bid for Santa Fe, although 


worth more than Burlington 
Northern's, had looked less 
likely to succeed because it ran 
the risk of being ruled ant on 
anti-trust grounds by the regu- 
latory authorities. Large pails 
of the Union Pacific and Santa 
Fe rail networks overlap. 

Under the new proposal, 
announced late on Tuesday, 
Union Pacific is offering $17.50 
for each Santa Fe share, $10 of 
it in cash and the r emain der in 
Union Pacific stock. 

If Santa Fe shareholders 
accept, Union Pacific will set 
up an independent voting trust 
to hold Santa Fe’s stock while 
the regulatory authorities con- 
sider thp deal. 

The effect of the offer is to 
transfer the risk of a regula- 
tory refusal from Santa Fe's 
shareholders to Union Pacific's 
because if the deal were disal- 
lowed, Union Pacific would 
have to dispose of the Santa Fe 
stock - possibly at a substan- 
tial loss. 

Union Pacific's shareholders 
are not, however, being asked 
to approve the proposal. 

Santa Fe's shares shot up 
$1% to $16 in early trading yes- 
terday, a rise of 9 per cent. 

Union Pacific's shares 
dropped $'/, to $49 , /< l while Bur- 
lington Northern's were up $'/« 
at $49%. 


By Richard Tomkins 


Alcoa considers first 
investment in Russia 


Increased sales and better 
margins helped Federated 
Department Stores, US owner 
of the Bloomingdale's depart- 
. ment store chain, boost net 
I income to $44.3m in its third 
quarter to October from 
$20.3m previously. 

The increase was exagger- 
ated by a tax adjustment in 
tbe comparable period, bnt 
Federated said net income 
would still have been 26 per 
cent higher if the adjustment 
had not taken place. 

Earnings per share rose to 
35 cents from 16 cents. 

Part of the profits increase 
came from an 8 per cent rise in 
revenues to $1.93bn from 
$1.79bn. Federated opened four 
new stores during the period, 
faking the total to 235, while 
sales at existing stores rose by 
3.4 per cent 

Federated also benefited 
from its efforts to improve effi- 
ciency. 

Selling, general and admin- 
istrative expenses fell to 31.7 
per cent of sales from 33.8 per 
cent partly reflecting the 
group’s investments in retail 
technology. 

Mr Allen Questrom, chair- 
man and chief executive, said 
the figures demonstrated the 
group's ability to run the busi- 
ness at the division level while 
concentrating at the corporate 
level on the planned merger 
with the rival R.H. Macy 
department store group. 


T hey make an odd cou- 
ple. On the one hand is 
Quaker Oats, a 103-year- 
old US cereal manufacturer 
whose name is synonymous 
with porridge. On the other is 
Snapple Beverage, a trendy 
soft drinks company that has 
shot to prominence in the US 
through the phenomenal suc- 
cess of its "new age" iced tea 
and juice drinks. Will tbe mar- 
riage work? 

Last week Quaker Oats 
announced it was paying 
$1.7bn in cash to buy Snapple. 
The acquisition, it said, would 
turn Quaker Oats into the big- 
gest soft drinks company in 
tbe US after Coca-Cola and 
PepsiCo, and accelerate future 
profits growth. 

But if it had hoped for a 
favourable reaction from the 
stock market, it was to be dis- 
appointed: Its shares tumbled 
$7% to $67% on the day, a fall 
of nearly 10 per cent. 

The Snapple acquisition may 
be the biggest in Quaker's his- 
tory. but it Is not the first. 
Since the 1960s, the company 
has diversified into other busi- 
ness areas, including fast-food 
restaurants, specialty retailing 
and toy manufacturing, only to 
get out again. But in 1983 it 
struck lucky when it bought 
Stokely-Van Camp, a US food 
company that made Gatorade, 
a sports drink. 

T hanks to a combination of 
changing tastes among increas- 
ingly health-conscious US con- 
sumers and heavy investment 
In the brand by Quaker Oats, 
sales of Gatorade shot up. In 
1983 they were barely SSOm; in 
the current financial year, they 


Quaker Oats {shore price S) 
85 — 






it . • S yi 


65, 

Aug 

Source: FT Graphite 


are expected to be SlJbn. 

But Gatorade's meteoric per- 
formance has not been 
matched by that of the group's 
other products, mainly cereals 
and pet foods. Here. Quaker 
Oats has been doing little bet- 
ter than holding its own in the 
face of tough competition from 
bigger rivals, and overall prof- 
its growth has been flaccid. 

The business logic for the 
Snapple acquisition looks 
straightforward enough. With 
Gatorade, Quaker Oats Is 
already the US market leader 
in sports drinks. With 
Snapple' s trendy Mango Iced 
Tea. Amazin' Grape Juice and 
the like, Quaker Oats will also 
become market leader in 
ready- to- drink iced teas and 
juice drinks. So Quaker Oats 


becomes market leader in the 
three fastest-growing beverage 
segments in Hu» US. 


F urther, Quaker Oats 
believes it can gam by 
feeding Snapple through 
Gatorade's distribution chan- 
nels. Snapple sells mainly 
through comer stores and deli- 
catessens, and has barely 1 per 
cent of its sales outside the US. 
Gatorade, in contrast, sells 
through convenience stores 
and supermarkets, a nd sells in 
more than 25 countries. 

Quaker Oats a fen announced 
it would offset part of the cost 
of buying Snapple by selling its 
European pet food and Mexi- 
can chocolate businesses. (Ana- 
lysts think they may fetch 
around 5700m.) Mr William 


Smithburg, chairman and cbte 
executive of Quaker Oat* sad 
this was to Seeping with the 
company's policy <rf improving 
the profitability of lowe r- 
return businesses, or divesting 
rtiran. 

“Our goal is to deliver above- 
average returns over time with 
a high-growth, high-margm 
portfolio of leading consumer 
brands that fuel health- 
conscious consumers around 
the world," Mr Smithburg said. 

So why tbe fall in the share 
price? 

Partly, it was because 
Quaker Oats will look a good 
deal less vulnerable to a take- 
over bid than before - but for • 
the worst of re as on s. 

Perhaps the biggest Is the 
fact that news of the deal coin- 
cided with the publication of 
Snapple's latest financial 
results showing that net prof- 
its had slumped from $2fL9m to 
$7Jm in the quarter to Septem- 
ber. 

Quaker Oats tried to play 
down concern over the figures. 
Snapple's annual sales had 
grown from $4Qm to $60Qm in 
four years, it said, and it was 
not unusual for a company 
g i m aiin g that qjrickly to hit a 
four bumps along the road. In 
this case, inventory bufld-ups 
had slowed factory shipments, 
mer chandising costs were up, 
and competition caused iced 
tea sales to be lower than 
expected. 

Yet Snapple’s potential diffi- 
culties cannot be ignored. One 
danger is that “good-fbr-you" 
beverages could be just a fad; 
but much the larger threat is 
that the mighty Coca-Cola and 


PepsiCo'- acutely aware of the 
fact that their colas areloslng 
market share to alternative 
drinks - win phmder-tise man 
ket for “new age" beverages 
and squeeze Snapple fin the 
pips squeak. - - V- 
The warning v si&is -are 
already there: PepsiCo,, in a 
joint venture- with thalavea^s 
Thomas J-Liptontea company, 
has launched liptaniced tea, 
and Coca-Cola, in' a Joint TOa. 
ture with Nestlfi of Switzer- 
land, has launched NeStea: - 
to. March this year Coca-Cola 
Introduced its own Tange of 
“new age" fruit drinks, such as 
Raspberry Psychic Lemonade 
and Grape Beyond, and 
PepsiCo has la u nched a range 
of lemonade drinks ' called 
Ocean Spray. 


: / * ■■ 


1 » ;f • 
i .-r 


' 'V-' 

-•■-V .- 


- 7- S. ' . . • 

• • - 

■ ”, -■ 


mr 


M eanwhile, Gatorade 
is also under siege. - 
Coca-Cola is attack- 
ing its market with, a sports " 
drink . called Fowerade . and 
PepsiCo with AH Sport Omi- 
nously, Quaker Oats suffered a 
slump in net profits to $SL4m 
from $8L4m in the ..quarter to. 
September, partly because ft 
had to spend more an market- 
ing to defend Gatorade from 
competition. -- - 
Quaker Oats has .acknowl- 
edged that the Snapple acquisi- 
tion. would dilute earnings per 
share by 45 cents to 55 crate in 
the year to June 1996. ft has 
also said the deal would not 
begin, to benefit the bottom 
line until the year to June 1998. 
If the share price is down, it is 
because seme investors wander 
whether even that could turn 
out to be too rosy a prognosis. 


Aluminum Co of America 
(Alcoa) is considering buying a 
minority stake in a Russian 
aluminium smelting plant in 
Siberia in what would be its 
first investment in the former 
Soviet Union, Reuter reports 
from Michig an. 

While the Initial investment 
would be small, it could grow 
to as much as $500m over the 
next 10 years, said Mr Paul 
O'Neill, chairman and chief 
executive officer. 

Mr O'Neill said he planned to 
visit the plant in Krasnoyarsk 
after the Thanksgiving holiday 
and would make a final 
decision within a couple of 
months. 


He added that the smelter 
had the capacity to produce 
750,000 tonnes of aluminium 
per year. However, the plant 
had numerous environmental 
problems and would need to be 
upgraded to become more effi- 
cient. 

He said his visit would pro- 
vide first-hand evidence of the 
investments needed to modern- 
ise the plant “I’m. convinced it 
is a sufficiently real and inter- 
esting possibility that I need to 
go look at ft myself.” 

A deadline for any possible 
deal is “close enough that 
we’re going to have to make a 
decision to put some real 
shareholder money at risk". 


Mei sees heavy Metall Mining to shut down smelter for three years 

Pentium demand 0 ■ 


Intel, the leading supplier of 
microprocessors to the per- 
sonal computer industry, 
expects demand for its Pen- 
tium chip to increase at an 
aggressive rate in 1995, AP-DJ 
reports from New York. 

Mr Gerhard Parker, senior 
vice-president, general man- 
ager, of the technology and 
manufacturing group of Intel 
said he also expected the PC 
market to continue growing. 

He said the company expec- 
ted 486 chip demand to fall off 
as popularity for tbe Pentium 
increases. 


By Bernard Simon in Toronto 


Metall Mining, the inter- 
national copper producer until 
recently controlled by Ger- 
many’s MetallgeseUschaft, 
plans to close its Copper Range 
smelter in Michigan next 
spring for about three years. 

The Toronto-based company 
yesterday put a brave face on 
the shutdown and various 
changes in mining practices at 
Copper Range which have 
dented productivity. The 
changes coincide with pro- 
posed modifications to the 


smelter required by tighter 
environmental standards. 

Mr Klaus Zeitler. Metall chief 
executive, said that the mining 
changes would have a detri- 
mental effect on earnings for 
the rest of this year, “but in 
the long-term it will have a 
highly beneficial effect”. 

Metall’s share price dipped 
by 75 cents to C$12 in early 
trading on the Toronto stock 
exchange. 

The Copper Range news 
overshadowed an overall 
improvement in third-quarter 
performance, caused by rising 


metal prices and higher Invest- 
ment income. 

Third-quarter earnings were 
CSS.lm (US$4.4Sm) or 7 cents a 
share. r f| ‘ m pf > T* i d with a fijs Qm 
loss, equal to 9 cents a share, a 
year earlier. 

Revenues climbed to 
C$208J5m from C$44J»m. largely 
as a result of last year's acqui- 
sition from Metallgesellschaft 
of a 35 per cent stake in Nord- 
deutsdbe Affinerie, the Euro- 
pean copper smelter. 

Copper Range’s cathode out- 
put fell to 22 Ml lbs from 248m 
lbs, due to lower grades and 


productivity. Metall said that 
copper grades slid by more 
than 10 per cent during the 
quarter as a result of difficult 
mining conditions, and a deci- 
sion to stop second-pass min- 
ing. Cash operating costs aver- 
aged US$1.05 a lb, up from 78 
cents in 1993. 

The suspension of second- 
pass, or pillar, mining, is 
designed to ensure stable rock 
conditions fin* solution mining , 
which is expected to be intro- 
duced in tandem with the 
smelter modifications. 

Metall has reached an agree- 


ment with Canada’s Hudson 
Bay Mining to process Copper 
Range concentrates for 33 
months, starting next March. 

Dr Zeitler said that Metall 
was keen to acquire another 
large copper mining project Its 
interest was focused on South 
America. It suffered a setback 
recently with a foiled bid for 
the Tintaya copper project in 
Pem. But Teck Corporation, in 
which Metall is a minority 
shareholder, unveiled plans 
yesterday for a final feasibility 
study of the large Petaqoilla 
deposit in Panama. 


^Bretu'rit 


ADVERTISEMENT 


NOTICE OF REDEMPTION 
CITY OF VIENNA 


USD 75,000,000 8% Notes 1986/96 


Financial 
managers - 
your future 


The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this 
announcement, makes no representation as to Us accuracy or completeness and expressly disclaims 
any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any 
part of the contents of this announcement. 


CHIC Telecommunications limited 

(Incorporated in the Cayman Islands wilh limited UabilUy) 


Noore is hereby e'nten that pursuant to section 5(a) of the Terms and Conditions of the Notes, City of Vienna wfll redeem on 14th November 1994 USD 15.000,000 
principal amount of said 8% Notes due November 14. 1996. Serial numbers of drawn Notes to be redeemed ore sat forth below on groups from one number to 
another number, bath inclusive; 


19 

- 

28 

2519 

- 

2528 

5019 

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5028 

7519 

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69 

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78 

2569 

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119 

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128 

2619 

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10128 

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12628 

169 

- 

179 

2668 

- 

2678 

5169 

- 

5178 

7669 

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7678 

10169 

- 

10178 

12669 

- 

12678 

219 

- 

228 

2719 

- 

2728 

5219 

- 

5228 

7719 

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7728 

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- 

10228 

12719 

- 

12728 

269 

- 

278 

2769 

- 

2778 

6209 

- 

5278 

7769 

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7778 

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- 

10278 

12769 

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319 

- 

328 

2819 

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2828 

5319 

- 

5328 

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- 

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12828 

369 

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378 

2889 

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5309 

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7878 

10389 

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419 

- 

428 

2919 

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2928 

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5428 

7919 

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7928 

10419 

. 

10428 

12919 

_ 

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4GB 

- 

478 

2969 

- 

2978 

5409 

- 

5478 

7969 

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7978 

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- 

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12969 

_ 

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519 

- 

528 

3018 

- 

3028 

5519 

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5528 

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10828 

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928 

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10928 

13419 

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969 

- 

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3469 

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3478 

nyifl 

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1019 

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FUTURE career opportunities 
for financial sector managers 
nowadays depend more and 
more on the right qualifications. 
An MBA degree specially 
designed by recognised interna- 
tional institutions for profession- 
als m financial services can open 
new doors on the career devel- 
opment ladder. 

That is why the world famous 
Man Chester Business School 
and the highly respected School 
of- Accounting, Ban ki n g and 
Economics at the Unlvendty of 
Wales, Bangor have designed a 
unique distance learning MBA 
with ■ financial services empha- 
sis. The management education 
programme is now proving so 
successful that over 750 students 
have enrolled worldwide since it 
was laa n chcd in 1992. 

The MBA has a high level of 
contact with Faculty, maintained 
through residential workshops 
ron in the UK and at overseas 
support centres. 

The number of snideius in each 
workshop is kepi deliberately 
low to maintain the teaching 
quality and interactive nature of 
the sessions. 

A major advantage for qualified I 
accountants is provided by an 
IS-moadi accelerated programme 
which eliminates the need to 
I repeat core subject material. 

The MBA's modular structure 
also links with advanced man- 
| age ment education and corpo- 
rate training programmes by 
offering exemption-based entry 
routes. The programme is one 
of the two distance learning 
MBA's in the CiB Lombard 
Scheme and has a major spon- 
sorship link with Euromoney. 
Brochure franc Institute for 
Ftaancia] Management, 
University of Wales, Bangor, 
Gwynedd. U. K. LL57 2DG- 
Tell (44)01248 371408 
Fax: (44) 01248 370769 


Warrants entitling the holders to purchase 
ordinary shares of HKSG.50 each in 
Hong Kong Telecommunications Limited expiring 
on 10th February, 1995 (“Warrants”) 


sino Group i 


ANNOUNCEMENT 


The directors of OTIC Telecommunications Limited are aware that foe register of members of 
Hong Kong Telecommunications Limited (“HK Telecom”) will be closed from (Hong Kong time) 
5th December, 1994 to 9th December, 1994, both days inclusive, (foe “Book Close Period”) for foe 
purpose of determining foe entitlements to HK Telecom's interim dividend of HKS0.269 per HK 
Telecom ordinary share for the year ended 31st March, 1995. Holders of foe Warrants are reminded 
that according to the terms and conditions of tbe Warrants, the right to exercise the Warranto 
be suspended if foe Exercise Date fas defined in foe conditions endorsed on tbe Warrant certificates 
(“Conditions”)) shall foil less than 10 Business Days (as defined in foe Conditions) prior to the first 
day of foe period during which foe register of members of HK Telecom is closed or during the Book 
Close Period. 


Accordingly if an Exercise Date relating to the exercise of any Warranto shall foil within the period 
from 22nd November, 1994 to 9fo December, 1994, such Exercise Date shall be postponed until the 
first Business Day after the expiry of such period. 


Holders of the Warrants are further reminded that according to the terms and conditions of the 
Warrants, holders of Bearer Warrants who have delivered duly completed Exercise Notice (as 
defined in the Conditions) containing payment instruction for the Exercise Price (as defined in the 
Conditions) and Exercise Expenses (as defined in foe Conditions) to Euroclear or Cedel not later 
than 10.00 a.m. on 21st November, 1994 (Brussels time or Luxemburg time, as the case may be) 
and registered holders of Registered Warrants who have delivered duly completed Exercise Notice, 
together with foe Warrant certificates) and payment for the Exercise Price and Exercise Expenses to 
Central Registration Hong Kong Limited, foe Registrar, at I7fo Floor, Hopewell Centre, 183 
Queen’s Road East, Hong Kong not later than 10:00 a.m. on 21st November, 1994 (Hong Kong 
time) will be registered as a shareholder of HK Telecom before foe register of members of HK 
Telecom closes and will qualify for tbe proposed interim dividend of HK Telecom. 

Each Warrant entitles foe holder thereof to purchase one ordinary share of HK30J0 of HK Tel eco m 
at foe Exercise Price or, at the option of CITIC Telecommunications Limited, to be paid foe cash 
equivalent of the then dosing price of such shares in HK Telecom on foe Business Day before the 
relevant Exercise Dale. 




-Yr 


By order of foe Board 
Amy Wong Hing Hung 

Secretary 


Hong Kong, 5th November, 1994 


USD 30,000.000 nominal amount of the Notes will remain outstanding after November 14, 1994. Payment will be made upon surrender of the Notes, together with 
sfl coupons maturing after the date fixed for redemption, at the office of the Raying Agents as shown on the Notes. 


Motes should be surrendered for payment together with all unnurtured coupons, appertaining thereto, faftng which die face amount of the nvssng unmatured 
3Qupons win be deducted from the principal amount due tor payment. 


jfr Dbfc 

Decades of faatorkal fauna pdas 


Banque GenErale du Luxembourg 
F iscal Agent 


Christiania Bank og Kreditkasse 

tkt KmMm of makBmuolSMBw 

U.S.$200,000,000 

Primary Capitol Undated floating Rate Notes 

Notice is hereby given rfxjt the Rote of Interest has been fixsd Of 
6.3125% and that the interest payable on the relevant InlpresJ 
Payment Dale May 10. 1 995, against Coupon Na. 17 in rested of 


Mravnag ewiytfaiagyw wd to aae bhj«- 
r DM Mats OUI fafcfffe* bdp ym pofcru, 


35 YEARS OF HISTORICAL PRICES TOR 

CASH. FUTURES. OPTIONS AND 
UTOfiX MARKETS. 

30 YEAOS OF FUNDAMENTAL ITTCRMATiOCt 
woraiuiaMconEs 

smm to ihc h ftxm anoq found to tin CRB 
Oaomafitr Year Book, tbe WUe-oflfte 
taoiu tadmy. Inaddltnaio 
bteoded dm. CRB bfaltafe ate, prartfal drifr 
pries qpdita via KR -Quote, Kwgtn.Ridikrti 


10, 1994. London _____ . 

i, N A (Issuer Services). Agent flank Q f ffi/yW CP 


WTO RMATKJN^ralto’vikfl 
KRftj*,7SEteaS«a.LottlooBC4Y IHY 
■0*441 ffn Tt 842 4Mg 


Residential 
Property 
PRIVATE # 
ADVERTISERS 

please contact 
Sonya MacGregor 
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uSus 


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Limited 




-_* i'iMiri:.- 


FINANCIAL. TIMES THURSDAY NOVEMBER 10 1994 


INTERNATIONAL COMPANIES AND FINANCE 


US operations help News Corp rise 15% 


By Bruce Jacques In Sydney 

News Corporation, Mr Rupert 
Murdoch's international media 
group, has begun the financial 
year with a solid rise in net 
earnings following strong 
results from the company's 
film and television operations 
an the US. 

News Corp yesterday 

announced a 15 per cent rise in 

net profit to A$30lm (US$232m) 
in the three months to end' 
September, from AS262m a 
year ago, on a 7.6 per cent 
increase in operating revenue 
to ASL99bn from A$2.78bn. 

A 43 per cent rise in earnings 
from associated companies anrf 
a lower net interest bill also 
he lped earnings. However, 
Australian and UR newspaper 
interests were flat 

Most of its earnings came 
from the US, where operating 


income rose to AS283m from 
A$24Sm. Directors said profits 
from Twentieth Century Fox 
films had doubled in the quar- 
ter following successful 
releases such as Speed and 
True Lies. Results from the Fox 
television statical group were 
also up strongly. 

Magazine and inserts results, 
where operating income rose to 
AS74m from A$70m .benefited 
from higher pricing and adver- 
tising revenues. But eAming s 
from the RarperCollins book 
publishing operation eased to 
AS65m from A$76m, reflecting 
weaker results from the San 
Francisco group. 

Operating income from UK 
operations fell to AS65m from 
A$75m, with directors citing 
the impact of The Times news- 
paper’s price cut in June. “Cir- 
culation at The Times now 
stands at 607,143, an increase 


News Corporation 

Stare price (A$) 

&0 — - 



iass 04 

Source; Datasuwm 

of more than 37 per cent versus 
a year ago," they said. 

“At The Sun, circulation 
remains in excess of 4m copies 
following a 2p cover-price rise 
on August 22. On the advertis- 
ing front, revenues are up 


across all titles, due to an 
improving advertising market 
aud higher circulation levels." 

Directors said BSkyB, the 
company's 50 per cent owned 
satellite broadcasting subsid- 
iary (in which Pearson, owner 
of the Financial Times, has a 
stake), achieved a significant 
increase in operating profit, 
with total subscribers exceed- 
ing 3.6m. 

The company's Australia and 
Pacific Basin region saw the 
biggest segmental earnings 
fall, with operating income 
down to AHOm from A$89m. 
Directors said revenue gains 
had been offset by higher 
depreciation charges due to 
plant modernisation. 

Star TV. the 64 per cent 
owned satellite broadcasting 
subsidiary, incurred a loss. 

Ansett, the 50 per cent 
owned Australian airline, con- 


tinued to increase earnings, 
and with BSkyB, lifted the con- 
tribution from associated com- 
panies to A$106m from A$74ra. 

News Corp’s direct operating 
income fell by 56 per cent to 
AJ388m from A$4lim, mainly 
reflecting last year's sale of the 
South China Morning Post and 
unfavourable exchange rates. 
However, currency changes 
also contributed to a Call In 
interest expense to A$l54m 
from AS173m. 

Tax provisions took A$47m 
compared with A$39m. This 
excludes a A$3m abnormal 
profit, compared with a A$16m 
loss previously. 

US operations contributed 
the biggest share of group rev- 
enues, up to A$2.2bn from 
All. 93 bn. UK revenues eased 
to A$469m from A$471m and 
Australian revenues were 
down to A$375m from A$382m. 


Japanese drugs groups withstand price cuts 


By EmOco Terazono 
h Tokyo 

- Cost-cutting 

.' : and strong 

„:cAV sales of high- 

'^S^Cr margin drugs 
o££set 

Riannaogtrticabi rf weak 

overall sales growth to support 
earnings at leading Japanese 
pharmaceuticals companies for 
the first six months to Septem- 
ber. 

Although average drug 
prices were marked down by 
6,6 per cent across the Industry 
in April, after the ministry of 
health and welfare cut pre- 
scription drug prices, there 
was a sharp rise In sales the 
same month as customers, who 
had held back orders, rushed 
to take advantage of lower 
prices. 

Profits were further sup- 
ported by a sharp rise in sales 
of vitamin drinks, helped by an 


Interim results to September 1994 (Ybn) 



Sates 

Clang* on 
year (%) 

Recurrfng 

profit* 

Change on 
y«ar (%) 

Net 

profit 

Change on 
rear (%) 

Takeda 

2836 

• t06 

40.7 

+46 

216 

+13.8 

Yamanouchi 

136.3 

+6.1 

. 29.5 

+5.4 

166 

+2.1 

Fujisawa 

117.5 

♦06 

126 

+5.1 

46 

+146.6 

SKoiogi 

113.3 

-0.6 

11.0 

-6.7 

4.7 

-13.3 

Dedicfii 

105.7 

+16 

r« 20.0 

+2.9 

9.4 

+36 


unusually hot s umme r. 

Takeda Chemical said 
healthy sales of vit amin tablets 
boosted profits. Profitability at 
its pharmaceutical division, 
where sales rase 0.8 per cent, 
weakened due to drug price 
cuts and growing research and 
development costs. However, 
the healthcare products divi- 
sion benefited from strong 
sales of v itamin drinks to show 
a sales rise of 86 per cent. For 
the fiifl year to next iWamh , the 
company expects recurring 


profits to fall 06 per cent to 
Y77bn (17936m) on a 1.5 per 
emit rise in sales to Y570bn. 

Yamanoochi P harmanantiral 
saw strong sales of its stomach 
ulcer remedy Gastar. although 
sales of its interferon drug suf- 
fered from price cuts. The com- 
pany will raise its interim divi- 
dend payment to Y8 per share 
from last interim’s Y66. For 
the foil year, it expects sales to 
rise 2 per cent to Y265bn on a 
0.2 per cent increase in recur- 
ring profits to Y546bn. 


SA Breweries advances 21% 


By Mark Suzman 
in Johannesburg 

South African Breweries, the 
country’s largest industrial 
company, recorded a 21 per 
cent rise in attributable profit 
to B342m (9976m) fig* the six 
months to September, com- 
pared with B283m for the same 
period a year ago. The figure 
was broadly in line with mar- 
ket expectations. 

An improvement in South 
African consumer confidence 
helped all divisions, which pro- 
duced an overall 14 per cent 
rise in turnover to R12.9hn, up 
from R11.4bn previously. 
Improved margins meant that 


trading profit rose 19 per cent 
to RU5bn from R971m. 

Tax paid rose to R949m from 
R765m, while net financing 
costs dropped slightly to 
R241m from R249m a year ago. 
The interim dividend was lifted 
21 per cent to 47 cents from 39 
cents. Meanwhile, cash flow 
rose sharply to Rlbn. well up 
on last year’s R272m. The 
group attributed this to of its 
tight management of working 
capital 

The beer division, which con- 
tributes most of the bottom 
line, achieved earnings growth 
of 21 per cent Meanwhile, the 
group’s other interests, includ- 
ing Lion Match, Plate Glass 


Shatterprufe Industries and 
Afcol, showed a combined 20 
per gpnt rise in earnings. 

• SAB has has reached condi- 
tional agreement with China 
Resources Enterprise, the 
Hong Kong-listed subsidiary of 
the PRC state-owned China 
Resources Holding , to form a 
joint venture that will hold 
CRE’s existing 55 per cent con- 
trolling interest in the Shen- 
yang Brewery, China’s second 
largest brewery. 

SAB will pay $25m through 
its subsidiary Westgate World- 
wide. which holds the group’s 
international beverage activi- 
ties. to participate in the joint 
venture. 


Casino group in Sydney listing 


By Bruce Jacques 

Casinos Austria, the European 
casino operator, has 
announced plans to raise 
A$6L5m through a listing on 
the Australian Stock 
Exchange. 

The company wQl offer a 45 
per cent interest in a company 
called Casinos Austria Interna- 
tional (CAD as part of a plan 
for farther expansion in the 
Asian region. 

CAI will control the equity 
investments, management con- 


tracts and development rights 
of Casinos Austria's operations 
outside Europe. These include 
the operation or management 
of three Australian casinos, in 
Canberra and Cairns, and on 
Christmas Island. 

Casino’s Austria, which will 
retain a 55 per cent interest in 
the Australian group, operates 
55 land and 21 shipboard casi- 
nos, with a further nine con- 
tracted for operation. 

The parent company's presi- 
dent, Dr Leo Wallner, said yes- 
terday the group would use 


Australia as a “launching pad" 
for expansion in the Pacific 
Rim. 

The Australian company also 
holds options to participate in 
several of the parent's expand- 
ing casino operations, includ- 
ing projects in the US and Can- 
ada and on cruise ships 
operating from Greece. 

CAI is projecting an increase 
in revenue to A$7l.5m 
(US|53.8m) for 1995 from 
A*61.4m this year. A A$l0-9m 
pre-tax profit has been forecast 
for 1995. 


SomoK Conpmtf wpora 

Fujisawa Pharmaceutical 
saw firm drug sales, while prof- 
its were supported by a cut in 
research and development 
costs. After-tax profit rose 
sharply due to decreased 
appraisal losses on shares of 
its subsidiary, and smaller cor- 
porate tax payments. Annual 
sales are expected to fell 1.2 
per cent to Y232bn, while cur- 
rent profits are expected to rise 
10.3 per cent to Y22bn. 

Shionogi said a fall in drug 
sales and interest revenue hurt 


profitability. The company suf- 
fered an average cut in drug 
prices of 4.8 per cent, while 
sales of its mainstay anti- 
biotics were weak. For the full 
year to March, Shionogi 
expects a L4 per cent drop in 
sales, to Y227bn. on an 11 per 
cent fall in recurring profits to 
Y206bn. 

Daiichi Pharmaceutical attri- 
buted an earnings rise to 
strong sales of its anti-bacterial 
agents. Cost cutting also 
helped. The company expects 
full-year sales to rise 16 per 
cent to Y210bn and current 
profits to increase 06 per cent 
to Y386btL 

Sankyo, which will report its 
earnings today, is expected to 
see solid profits growth, attrib- 
utable to strong sales of its 
anti-cholesterol drug. However, 
revenues are expected to have 
suffered because of decreased 
sales of drugs made by Sandoz, 
the Swiss drug company. 


NEWS DIGEST 

WestLB studies 
reorganisation of 
investment side 

Westdeutsche Landes bank Girozentrale, the 
German regional bank, is considering reorgan- 
ising its investment banking activities in Lon- 
don, Reuter reports from Dnsseldorf. How- 
ever, the bank said it had not yet made 
definite decisions. 

“We are thinking about our investment bank 
activities in London.” the bank said. It 
declined to confirm reports that ft planned to 
move its non-DM bond issuing business to 
London from Dusseldort 

“We are not interested in encouraging specu- 
lation against the background of an ongoing 
review [of WestLB’s activities J," the bank said. 

Last mnqth, Deutsche Bank, Germany’s larg- 
est commercial bank, decided to put all its 
international investment banking activities in 
the UK capital combining its activities with 
tb ps* of Morgan Grenfell the UK merchant 

hank 

Sales to SA telecoms 
help lift Rennert 18% 

Reunert, the South African technology group, 
has posted an 16 per cent increase in pre-tax 
profit, to R304m (S87m) from R2576m for the 
year to September, helped by increased sales 
to South African parastatals w«fcnm and Tel- 
kom, writes Mark Suzman in Johannesburg, 

Turnover, which for the first time includes 
brand nat n^ Panasonic. Nashua and Airoma- 
tic, rose 48 per cent to R36bn from R2.4bn. At 
the samp time, an 8 per cent, drop in the 
minority shar e of profit to H40.6m freon R44m, 
helped attributable profit surge 39 per cent to 
Rl 5064m from R1082m. 

A final dividend of 19.5 cents has been 
declared, bringing the total for the year up 15 
per cent to 27 cents compared with 23.4 cents. 

China Airlines hit by 
private competition 

China Air lines , Taiwan’s flagship carrier, said 
sales in the first nine months fell 1 per cent 
compared with last year, to T$32.22bn 
(US$l6bn). AP-DJ reports from Taipei 

The airline feces strong competition from 
Taiwan’s first privately-owned International 


carrier, Eva Airways. CA’s Japan and Hong 
Kong routes account for a large portion of 


Nedcor boosts net 
income 24% to R603m 


SoucKDatasbeesn 


„ „ Nedcor, the South Afri- 

M8dcor can financial services 

Sham price (rand) * ut ® 

« solid performance for 

" . | the year ended in Sep- 

34 i-.-JL—l- tember, raising net 

1 1/| ] income 24 per cent to 

32 MpHlf- HfiOSm from R486m pre- 

‘ HI Y ' viously, writes Mark 

30 f"P — * Suzman. While interest 

„ 11 1 ^ income rose by only 10 

' Wl/ per cent to R7bn from 

2Q i ?yv R6.4bn, a 16 per cent 

IBM rise in non-interest rev- 

SoucKDatastnxsn emifi, to RL37bn from 

Rl.lTbn, combined 
with a rise in expenses of only 9 per cent, to 
R4£7bn from R467bn, boosted total income to 
R3.4bn from R26bn. 

Taxation rose 13 per cent to R363m from 
R320m, while a final dividend of 95 cents was 
declared, up 23 per cent from last year’s 77 
cents. The bad debt provision dropped 2 per 
cent to R277m from R282m. 

Indonesian bank surges 
in first nine months 

Rawir umrnn Nasto nal th* Indonesian bank, 
said unaudited after-tax profit for the first 
ninfl months this year rose 164 per emit to 
Rp39.1lbn (Siam) from Rpl462bn a year ear 
lier, on a 16 per cent rise in revenue, AP-DJ 
reports from Jakarta. It attributed the sharp 
rise to a slower rate of increase in interest 
burdens, up only 6 per cent to Rp285.06bn. 

Meanwhile, PT Lippo Bank, the banking 
arm of file diversified Lippo group, said its 
after-tax profit for the third quarter ended 
September 30 was Rpl66bn, up 60 per cent 

Tiger Oats improves 

Tiger Oats, South Africa’s largest agricultural 
goods and foods supplier, attributed a 10 per 
cent gain in pre-tax profit, to RS61.8m 
($189 6m) in the year to September 30 from 
R599.7m in 1993, to restructuring and better 
r«sh management, AP-DJ reports from Johan- 
nesburg. 


Future Prospects 
Present Profits. 




NEW ISSUE November 9, 1994 


Cable & Wireless results for 6 months to 
30th September 1994 


■i.-i"'* ! 


Pro!*'? Vfi 

:adv<, 

; 7:Y 

. . ^ »,*i' J* 


FannieMae 


*400,000,000 
8.625% Debentures 

Dated November 10, 1994 Due November 10. 2004 

interest payable on May 10, 1995 and semiannually thereafter. 

Series SM-2004-L Cusip No. 31359C BA2 
Callable on or after November 1 0, 1 999 

Price 99.984375% 

Ftooteral Nafioreof As«xi^ 

CtertarXa(i2 OS£- 1716 et sqq.). 


Debentures w* be available In form orty. ■ 

There wl tie no deWfire sacurifies offered- 

Linda K. Knight 

Sector Vice Pnsfdmt 
an d Treasurer 

; 

-tWs anrwAflrtMnr gppemiTise maaar ot nc#* <**/- aweancamefit a 
oatfur » * utaaaaon aim* a** to buy any of D&unres. 


Turnover up by 9% to £2.5bn. 

Operating profit up by 17 % to £592m. 

Profit before tax up by 11% to £5 67m 
EPS up by 7% to 11.9p. 

Recommended interim dividend per share up by 9% to 2.83p. 



CABLE & WIRELESS 


Cable and Wireless pic, 124 Theobalds Road, London WC1X 8RX, United Kingdom. 

Interim dn ideiui »f 2.8 3p payable -8/h February i 995 to Shareholders on the Register ar 22nd December 1994. If you have any enquiries as a Cable & Wireless 
Shareholder, please call us on t-44 -7 1 - 3 1 5-4455. A copy of the Interim Report will be posted to Shareholders on 16th November 1994. 


•: - 

>-* A/ • . 




Four years of explosive growth for GDRs 

India leads the way as emerging markets embrace the global depositary receipt, reports Martin Brice 


T he global depositary 
receipt, a financial 
Instrument with humble 
beginnings, has been pushed 
into the spotlight by the 
increasing globalisation of 
equity markets and a steep 
increase in demand far capital 
from com p a ni e s in the emerg- 
ing markets of Latin America. 
Asia and eastern Europe. 

Since its birth with the first 
humble $4fen issue in 1990, the 
GDR market has experienced 
rapid growth. Issues to date 
this year exceed $5.5bn. an 
increase by a factor of 137 
since 1990. Growth has out- 
paced that of the international 
bond markets, where issuance 
doubled to $481bn between 1990 
and 1993. 

Growth has been particu- 
larly rapid in India, where use 
of the depositary receipt mech- 
anism allows International 
i nv estors to circumvent the 45- 
day settlement period on the 
Bombay Stock Exchange. 

The attraction of ease of set- 
tlement is likely to lead to a 
Anther spurt in growth of the 
GDR market as Russian com- 
panies seeds international capi- 
tal. Using local stock 
exchanges to raise the money 
needed for investment and 
modernisation would he impos- 
sible. 

Already Kfemwort Benson, 
the OK merchant b ank, is plan- 
ning a multi-bflUon GDR when 
Gasprom of Russia, the world’s 
biggest gas company, sells a 9 
per cent stake to international 
Investors next year. 

As well as ease of settlement, 
use of a GDR allows interna- 
tional investors access to 
equity markets which would 


otherwise be out of reach. 

Jardine Fleming, the 
UK-based Investment bank, 
has constructed a fssQrn issue 
for Benpres, the largest broad- 
casting group in the Philip- 
pines, to allow foreigners to 
own GDRs but not the underly- 
ing shares, because there are 
restrictions on foreigners hold- 
ing media shares in the Philip- 
pines. 

One of the leading hanks in 
the sector, Jardine Fleming 
also recently arranged a GDR 
for an Indian company that 
uses wind power to produce 
electricity, which was heralded 
as the first "green" GDR. 

More generally, growth in 
the GDR market is partly a 
reflection of the globalisation 
of the world's equity markets, 
as investors in mature econo- 
mies seek opportunities in 
e mer gin g markets and as com- 
panies in those markets seek 
international capital 

This trend is noted in a 
recent report* on the global 
capital market by McKinsey 
Global Institute, the manage- 
ment consultants. The report 
says: "There will be a coinci- 
dence of needs between the 
high savings of the developed 
world that will be seeking high 
returns and the abundance of 
high-return investment oppor- 
tunities in the developing 
world that will require exter- 
nal capital and know-how.” 

This coincidence of needs 
’has come to a head in India , 
where the government has 
embaiked on a process of liber- 
alisation of foreign trade and 
Investment 

The GDR has been used by 
Indian companies to raise more 


GDR premfums/tfiscounts fa the fenefian market 


20 — 


10 — 


-10 — 


-20 — 


-30 — 


-40 


-60— t 



Junes 
Soutm JvdnaAartfig 


000*93 

•W94- 

F0VM 


Feb*S4 




8*p*V4- 
Jun-W Dec*** 

JuT94 


than $2.2bn so far tht« year, 
making India the biggest GDR 
market in the world. By the 
end of this year, almost $2-5bn 
in GDR issues will have come 
from India. Last year the total 
was less than $90Qm. 

S ince the first Indian GDR 
was issued In 1992, 50 
Indian companies have 
received almost $4bn of the 
$11 bn raised from GDR issues. 

Mr Ian ffannam , a director of 
Jardine Fleming, believes fodta 
has many attractions over 
other emerging markets. "The 
real attractions are the exis- 
tence of a middle class the size 
of the entire USA, and a recog- 
nised legal and accounting 
framework for the ownership 
of assets.” 

The absence of a legal frame- 
work for the ownership of 
assets is a problem for the 
emerging economies of eastern 
Europe, but not for India, he 
said. 


The year started well for 
Indian GDRs, with about a 
dozen Issues in January and 
February. They were well 
received, with international 
investors paying a premium of 
about 11 per cent for the depos- 
itary receipt over the underly- 
ing shares. 

However, sentiment deterio- 
rated in February, partly 
because yields on US Treasury 
bonds rose. International 
investors began to sell their 
GDRs. which fell to a discount 
of about 5 per cent to the 
underlying shares. 

As the price oT GDRs fell, the 
discount deepened to around 15 
per cent as international inves- 
tors began to put fluids aside 
for the sale in May of Vldesb 
Sanchar Nigam (VSNL). the 
state-controlled international 
telecommunications monopoly. 

The Indian government post- 
poned that sale, which it had 
hoped would bring in Slbn. 
However, investors believed 


that the price, set by the gov- 
ernment In consultation with 
VSNL and global co-ordinators 
KJeinwort Benson of the UK 
and Salomon Brothers of the 
US. was too high. 

The postponement was 
regarded at the time as India's 
biggest setback in the interna- 
tional capital markets since 
Indian issuers first raised 
funds. 

Meanwhile, the Indian gov- 
ernment’s recent announce- 
ment tha t It is chang in g the 
rules for companies issuing 
GDRs may mean the market is 
about to enter a new phase. 

India has ended the use of 
warrants, which give investors 
the right to buy shares at a 
fixed price in the future. War- 
rants were often used to make 
an offer more attractive, since 
they could be priced more 
cheaply than existing shares. 

The end of warrants is likely 
to mean a two-tier market 
emerging for Indian GDRs. 
believe some investment bank- 
ers. Whereas blue-chip compa- 
nies Like Baja] Auto, whose 
issue was priced at a premium 
to the underlying share, are 
likely to find ail enthus iastic 
welcome, second-line compa- 
nies are likely to struggle, 
bankers believe. 

However, with more than 20 
permissions given by the 
Indian government for fund- 
raising issues of Siocun cur- 
rently outstanding, the GDR 
has an active future. 

At least one London mer- 
chant bank is believed to be 
looking at using GDRs to 
finance telecom projects in 
India, which is likely to r emain 
the biggest market for GDRs. 


HOW THE BANKS 
LINE UP 


Bookrunner 

USSm 

No faf 
issues 

1 Goldman Sachs 

2.120 

14 

2 Jardine Fleming 

1^79 

10 

3 CSFB 

777 

8 

4 HSBC 

7 70 

10 

5 Morgan Stanley 

770 

7 

6 BZW 

696 

8 

7 Baring Brothers 

624 

10 

8 Banco Roberts 

535 

2 

9 Bmqtie Paribas 

446 

6 

10 Lehman Brothers 

368 

5 

11 Marffl Lynch 

316 

5 

12 Salomon Bros 

304 

3 

13 Schroder Wagg 

280 

2 

14 JP Morgan 

276 

2 

15 Kleinwort Benson 

225 

2 

16 Deutsche Bank 

142 

1 

17 Citicorp 

126 

2 

18 Dahua 

118 

2 

19 Smith Barney 

107 

1 

20 S-G. Warburg 

95 

2 

21 FHaemina Capital 

90 

2 

22 Crosby Securities 

55 

1 

23 Ban qua tndosuez 

52 

2 

24 Banamax Acova) 

51 

1 

25 N.M. Rcnhschfld 

SO 

1 

26 Lazard Brothers 

35 

1 

26 Lucky Securttias 

35 

1 

26 Nikko Securities 

35 

1 

29 Dresdner Bank 

18 

1 

29 UBS 

18 

1 

Total 

11,113 

114 


Sranar Baamanay Bon Um ma 


Share surrogate that is easy to trade and settle 


The McKinsey report says: 
"We believe we are. . .at a mid- 
point of a 50-year process 
in a fundamental transfor- 

mation of how the world’s 
economy works.” The GDR 
looks set to play an important 
part in the globalisation of 
equity markets. 

* The Global Capital Market: 
Supply, Demand, Pricing and 
Allocation’, McKinsey Global 
Institute. Washington DC. 


Growth of GDR nnrfcat 


Depositary receipts have enjoyed such 
success because they can make buying 
and selling equity in a company easier 
for international investors than buying 
and selling the shares on a local stock 
exchange, writes Martin Brice. 

• The depositary receipt represents 
ownership of shares which remain in 
safe-keeping with a hank in the issuer’s 
home market, often either Rank of New 
York or Citibank. The receipt itself may 
be traded elsewhere. 

• Dividend payments are usually in US 
dollars, and voting rights are usually 
the same as for the underlying stock. 

• There is little technical difference 


between a global depositary receipt 
(GDR) and an American depositary 
receipt (ADR), although depositary 
receipts listed in the US tend to be 
called ADRs while GDRs are often 
listed elsewhere - for instance in Lux- 
embourg and increasingly in London. 

• The first ADR was issued in 1927, but 
the first GDR came only four years ago. 
The forthcoming listing by TeleWest, 
the UK cable television and tele- 
communications company on the US 
exchange Nasdaq will be called an 
ADR, but may be bought by any inter- 
national investor; the recent issue by 
Bajaj Auto, the the Indian scooter 


maker, was listed in London and called 
a GDR. 

• When investors buy and sell GDRs, 
settlement may be through CedeL Euro- 
clear or DTC, the US settlement system. 

• Issuing a GDR would cost a company 
around $100,000. A depositary receipt 
offered and listed in the US would cost 
a company up to Sim, of which about 
half would go on lawyers’ foes. 

• GDRs and the shares they represent 
are traded independently. Where there 
are barriers to international investors 
accessing the local stock market, the 
GDR may fetch a lower or higher price 
than the shares in the home market. 


• In 1990 Citibank, the US h ank, pio- 
neered GDRs with a $4Qm issue for the 
Korean company Samsung. In May this 
year Citibank developed the Singapore 
depositary receipt, which allows compa- 
nies outride Singapore to offer deposi- 
tary shares to Singapore investors. 

• Much of the business is now sourced 
from investment hanks in London, with 
Goldman Sachs and Jardine Fleming 
the leaders. 

• About 90 depositary receipts are 
traded via Seaq International and listed 
on the Luxembourg stock exchange. 
Around 275 depositary receipt pro- 
grammes are listed In the US. 


Others 



92 88 04 

8otfo« Eatunoney Bond— 


CBoT to assist 
Poland with new 
futures exchange 



By Laurie Morse In Chicago 

The Chicago Board of Trade 
will today sign an agreement 
with Polish officials to help 
establish a new futures 
exchange in Warsa w. Th e Chi- 
cago exchange has promised to 
contribute its expert ise in m ar- 
ket development in return for 
uns pecified fees and 15 per 
cent ownership of the new 
exchange. 

Although US futures 
exchanges have informally 
nggictwi emerging markets for 
years, this is the first time one 
hag commanded an ownership 
stake in a new venture. 

The CBoT’s agreement is 
with a foundation fed by the 
Polish government agency for 
agricultural markets and 
Rolimpex, a Polish agri- 
business concern. 

Mr Patrick. Arbor, the 
CBoT's chairman, said the 
agreement was the first of a 
smles of innovative interna- 
tional business arrangements 
his exchange expects to vnake. 

The membership equity 
gained from the Warsaw 
exchange "will provide addi- 


tional trading opportunities for 
our members and member 
firms,” Mr Arbarsaia. : V 
Polish officiate see, the cre- 
ation of a commodities 
e xchang e as an tmpcatast'stap 
in the transattan to arfree mar- 
ket economy . They expect 
wheat to be the first, oonomod- 
tty traded there; : ' .*■ - . ; 

However, futures trading 
may be a king way off ftr-fhe 
country, which first needs -to 
develop a free primary masbst 
for grain, and a legal frame- 
work for a fixtures market 
Mr Fred Grede. the CBoTs 
senior vice-president in charge ' 
of operations and pfenning, 
acknowledges the difficulties 
that face the venture. "One of 
the key questions is how to 
create a properly. 
cash market,” he said. He 
added that his exchange plans 
to use the expertise of its mem- 
bership to help develop the 
underlying systems needed to 
support futures trading. - 
Goldman Sachs in i ti ated foe 
folks between the CRoTand 
Poland, and intends to-' con- 
tinue to serve as an 'adviser 
and consultant on the project 


:•* 'V 1 


..- .j. 

1 r ’ 




Chemical Bank unit 
in Liffe joint venture 

- increased demand from hedge 
funds, many of which want a 
coni hinpd execution and clear- 
ing service, said Mr Matthew 
Fosh, a director and co-founder 
of Seagray. 

Unlike hank traders, hedge 
funds generally buy clearing 
services from third parties, 

wplairwri Mr Fosh- 

Seagray, which, employs a 
team of 25, was set up by Mr 
Fosh and Mr James Campbell- 
Gray, an independent t rader on 
Liffe since its inauguration. 

Mr Fosh previously worked 
at stockbrokers Strauss Turn- 
bull and then Sheppards. 

CF&O was set up in April 
1990 to complement Chemical 
Futures & Options Inc’s Chi- 
cago and Philadelphia 
operations and help capture 
the global growt h in exchange- 
traded derivatives. 


By Richard Lapper 

Seagray Fosh Futures, an 
independent UK futures and 
options broker, is to set up a 
50-50 joint venture with with 
Chemical Futures & Options 
(UK), a subsidiary of Chemical 
Bank of the US. 

The new company, SGF 
Chemical Futures and Options, 
will deal in both futures and 
options on T.Wfa, taking advan- 
tage of Seagray’s position as a 
leader in the exchange traded 
options market in London. 

It win make also use CF&O’s 
existing expertise in clearing 
and settlement, providing a 
“one-stop service” for both exe- 
cution and clearing of trades. 

The new venture is keen to 
increase its presence in the 
futur es market and-also hopes 
to be better placed to meet 


* Managing foreign exchange risk 
is lough enoegh-The fas thing you need 
to worry about is a risk-management 
tod that’s too risky in its own right. 
^ * That’s why the 

Philadelphia 
ilarivolivu risk 5tockExdni®r 
nl? fPKLX) has cre- 
ated the United Cur- 
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currency option trades are madccd-to- 
market daily and guaranteed by The Op- 


in f oreign oatdunagn 
uumnga 


fa- What's aJorc.UCOM options can 
be customized to meet users' specific 
— and ever-changing — needs. For the 
first disc oa any currency options ex- 
change, traders wiD be able to choose 
from a virtually infinite number of 
Strike prices and, ultimately, any capita- 
tion due. feWtal's mote, market users 
will have up to seventy-two currency 
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INTRODUCING A REVOLUTIONARY NEW 
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Joas.-UCOM options UCOM 


tkms Orating Gmpaafion (OCQ — the 
only clearing corporation in the worid 
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fike aO other FHIX op- 

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spreads, and ihc pofa&c 
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franc option can be an option on dol- 
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is Ft aL There's no market 

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UCOM offers everything (hat foreign 
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marixt, call the United Currency Op- 
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UCOM or 213496-1457. fcion 



UNITED CURRENCY OPTIONS MARKET" 

PHILADELPHIA STOCK EXCHANGE 
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European office 12th Boot; Moor Horae, 1 19 UmdoaVU, Louloa BC2Y 5ET Engbnd 
Telephone 44-71-606-2348 Far East TbB Free Access. Australia 0014800-127-570 • 
Hong Kong 8004893 • Japan 003 1-1 22868 • Singapore 8009942 

SMMWIWm. aHOi an do atmnod kn jam trakar oc m maUM Sock 





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THE EMERGING MAB KE1S S T R AT EGIC I P SP 
SadfetdlovcfekrowcB t Caffes! Vvrtfe* 

2, b allon d Ror^Lnmbamf 

mi mmnoiBB mm 

NOTICE 

b hncfav ana Iho a 

E UimJwj CtmlHnUq 

Will be hdd at ihe offices of Baaqoc I— dalle i IjitBaibuwig. 69. mu ifEscb, H*70 J 
Lnentowi an Novcstn 2S. 1994. « 2J0pa_ 

Tke ana mbjrctx » ddftnWi an. m the poapbiKiy irf amtoo ot » weend da of «ta»g. 10 Cte I 
■he »>■ 1 1 , hufcfcij msy ten lo detain *Cepfeilr«iilo Sfcnei* f not i mi j riin g n dh ni fcn A) id [ 

■Sc ■Dtatnbuoga Shares' (entiffing to d iet jLml ). 

Fhnlmuure. ia Older B comply »ilh Ihe Law, a second Net Area Vjtecnffl be retmlferri MOWMy. 

A* he Ankles of toaapsadoa have to nfleel three new provisions, the rienth n l drii axe luvfeu! ID I 
deUberate oo the Mowfag ifcadc 

AtSBWA 

At Art fcteS 

- Addblt of • penpal* p«rrfcSagtet«Q£lIeimcfarea of feares. 

» Artktrll 

. Antecdmealci ibe 2od pnagrspti sob to evidence the eztatcace of two ifiOexeia denes 

a AOfcfcJi 

Acttsflj. the Ceeporaitn nay Invest te se maks ed mfrsnt to offiehrf tinna on a teeng ni i nl 
shut esetfgliaeBySt*c miBl > n of *c OECD, A fe a. Orrvn U. Ike Aaencaaco nrtn iiii W 
■Dd Africa, 
bit 

0) 

n lobe |tven 



10 % at the tofel ea 
to I09L Any 


A*t*( of i ww pnacrepfe previdiiiB br the pareUfef of ooreerriaa ot *rM*rO»iiaa 
of Stares' iBD "Qiplntauian Stare* red vkc-verae 


Aauknesaarte lsiwnv>{A«ewtoMaRaiMakatttiaDo(teN(tAsM Vafaatper 
stare of eadk den twirr iumM. 

Aoeadanr of te 3ad penpnph m b to evUkw* the extaoece of two dtOmM < 
of s' 


AaetMtaeB of Ao In psagnpfa b a to evkksM the cxtanice oftrei <BSeRW c 


AtUaa of ■ poognph dcaerfcta* *t mesbods of destresotloo of the Nrt tar Vejac erf 
of Ac differrar dm. 




te 


t so a to evidence the c* 


I Of the Ik p e rapaph sod s riitag of a i 
«Wea»taioo of the s en ml profits farihervo rt e ser i of. 


Eoftwodffiera* 


: so ee to evidence ihe extaeace ot Ivo dlAsem i 


AAAs*ef mi 


nNeTxk|Aetd*nt(iwfBeMdaael fhntri. 


! P°«pow » he held oa Ocxiba 19. I9M had to be adjornned far I 


The meettaj eooveaed tor Ihe t 
hdetqnnn. 

Stareholders ere advfaod Has si Us Bectiag no qaona is referred and the decHoo ho prosed j 

hy a ■ajodjr cf reo ihhds of fee stares proem sad netag. 

la order to Bteod be oKttiai of THE BKQKHNO MARKETS STRATEGIC FUND, the owrom of 1 
tarn femes on tave to dqtoall their ifaanai five dear d^s befoev Ibe neefiag el da nghacred 1 
office of the company at with Buqoc IstcraaUoalo 1 LuesebanB. 69. root ifErch. L-1470 i 


Tbe Hoard of Dtrvcten 


j FPiAN Cp U-TtM ES | 

MANAGEMENT REPORTS 


AUTHORITATIVE 

MARKET 

REPORTS 



+44 (0)71 814 9770 

OR KAX 

+44 (O) 71 814 9778 


The Republic of Panama 

US$417,402,000 
Floating rate serial notes 
I99&-2002 

The notea mil bear interest at 
7 J25% per annum for the ■ 
interest period 10 Not f-mber 
1994 to 10 May 1995. interest 
payable an 10 Mav 1995 ux8 be 
USS35.S2 per USSI.OOO nan. 

Agent: Morgan Guaranty 
Triist Company 

JPMorgan 


NOTICE OF PARTIAL REDBOPTiatf 

Ftaanaen, SJ.C., TnA Division 

IMNtflhiMiftanIM 
Huatfag Rate totes Pm 1997 
CUSIP lik UNMIS* 

NOITCEBHtKfiBVGIVEN, pimant to thelndentare dated asofDeoember 
ISk 1992 under wMdi 9 k above «*— ryflil Note* were issued that Nadonal 
Ruueiecs, SLbLC, That Division, n s Truste e of the Nafln Finance Trust wiU 
redeem on Deaeote 15, 1991 14A 1772923545% af the Outstanding Principal 
Amount af Ihe Notes, a mo unti n g to $1X510JOOQAO on a pro rata basis in 
aomedanoewilfa their respec tiv e Ou t sta n ding ftindpel Amounts. The amount 
of principal to be paid wfih respect to reeh»0/U0 principal is JS7S5Q. 

On Deoanber 15, 1994, Ihm will become due and payable an each Note the 
above amount, together with interest acmredtoDecemba 15, 1994. On andafier 
such date interest will cease to aoaue on the Notes (or portion thereof so 
redeemed). 

Payment of the red em ption amount plus accrued Interest on Bearer Notes 
wiD be made upon pr esentati on and surrender of the appropriate coupon to 
one of the Paying Agents listed below: 

fTHhank . PLA. Htih a nk (Luxembourg) &A. 

336 The Strand 16 Avenue Morle-Therese 

landon, WC2H 1HB Grand Duchy of Luxembourg 

England Luxembourg 

O Hriark, HA., as Nate Trustee 

November 10, 1994 

This CUSIP number has been oastened by Standard & Poor's C aua n dba and is 
m^MedscUa/jwlhttmvattmuiftheniiUtn. Nritho- the Issuer w Ac Nefe Trust** 
d^bcrapanslble ft* ibcsdection arose af the CUSIP number, itoris any Tztrrtsatiatim 
mde as to its atmOtuss on the Notes or as indicated in thb notice 

NOTICE 

As of January 1, 19SJ, witiihotdfiw of 31% of moss pracaeds of any interest 
payment made within the United States may be required by the Internal 

Revalue Code of 1986, as amended fay the Energy Pbficy Act of 199% mden 
the Paying Agent has the correct taxpayer laoitifkation number (social 
security or employer identificatiou number) or exemption certificate of the 
Payee. Please furoiHfa a property cmnpkted Porm V« or 
cate or equivalent when presmUng your securities. 





ir»wi*' r T 


’rtsr 


it 


-.j’ 




S* 


NOTICE TO THE WARRANTHOLDERS OF 

OlP. Corporation 
(the "Company") 

U.S.5150,000.000 

33 per cant Bonds with Warrants 1994 

iORO I m^-i!^£ laU ^ of . tb ? Instnuneot dated 15th December, 
i»H5> (the Instrument") rdaiing to the above captioned Warrant 
notice is hereby given as follows: 

to accordance with the resoltttJonsof the Board ofDirectors of the 

SSESS the meeting hdd on 21st October, 1994 the 

company authorised a free distribution of common stock to be 
made to shareholders of record at 30th November, 1994 at the rate 
ofonc new share to each ten shares held. 

oftbe a 5? ve distribution, the Exercise Price has been 
adjusted pursuant to Clause 3 of the Instrument as set forth below: 

Rxerrise Pice before adjushnem: ¥1.847.10 

nxcxcue Pnce after adjustraertt; VI ,679.20 

Effective date of adjustment: 1st December, 1994 

(Japan time) 

S -P- Corporation 
y: The Sumitomo Bank, Limited 
as Fiscal Agent 

10th November. 1994 






« ' 





Citicorp Banking Corporation 

r- U.S. $250,000,000 

^ ,o - ,w 


, on O auuot 

cmcoRpG 
i isc Tonrra c ° nd 

i DBonriro- 28. 199fe.A 


nmuont to 


a> ’ >*«4.Afcrth» 


JA tPRfe, London 
N-A. Itiauar SrovicBa), Agextf Bonk 


CorefiKona of the Note notice h 
No. 43 wiP run from 

notice wifl bo published 


CfTIBANCC > 


£ 


■s. 


London School 
of leading 
-FUTURES- 


■ntnwive Fbtuics, Options & Cmrencacs 
trading Courses for Begbmere to Advaneed 
Bring btest and newest techniques. 

0719768101 




I : 







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■ ■—■i::;c-. ?**£ , 

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' “«uk 

»ank unit * 
^ venture 


FINANCIAL TIMES 


THURSDAY NOVEMBER 10 1994 . 


INTERNATIONAL CAPITAL MARKETS 


Treasuries rise on heels of dollar rally 


By Lisa Bransten in New Yale 
end Conner Mfddeimarm 
In London 

US Treasury prices rose on the 
heels of a rally in the dollar 
yesterday morning as traders 
sorted through the impact of 
strong Republican gains in 
Tuesday's mid-term elections 
and prepared for the afternoon 
auction of 10-year notes. 

By midday, the benchmark 
30-year government bond was 
up ft at 93A. yielding 8.088 per 
cent. At the short end, the two- 
year note was up & at 99% to 
yield 6.994 per cent 

News that Republicans will 
control both houses of the US 
legislature pushed the value of 
the dollar up more than two 
pfennigs against the D-Mark to 
DM1.5273 and to Y97.73 against 
the Japanese yen. The dollar 
recovery helps bonds because 
recent weakness in the cur- 
rency has deterred investors 
from buying US instruments 
such as government securities. 


Gains by the dollar also con- 
tributed to the rise in bond 
prices by boosting optimism 
about demand for the 10-year 
nates to be auctioned later in 
the afternoon. 

The reaction of the bond 
markets was somewhat 
restrained, however, as inves- 
tors waited for the tn 

interest rates expected to come 
from next Tuesday’s meeting 
of the Federal Reserve's open 
market committee. 

Most analysts expect a 50 
basis point increase that would 
bring the Federal funds target 
to 5V» per cent, but some are 
predicting the Fed might push 
the target as high as 5% per 
cent 

Traders were also waiting for 
today's report from the govern- 
ment on the producer price 
index. Analysts expect a 0.1 
rise in the index for October, 
but worry that a much greater 
increase could provoke an 
early or large increase in inter- 
est rates by the Fed. 


■ European government bonds 
were swept up by strength in 
the US market and closed near 
their day's highs. However, 
they shed some of their gains 
in after-hours trading as Trea- 
suries began to come off their 
highs. 

Ahead of next week's FOMC 
meeting, European markets 
are expected to continue 

GOVERNMENT 

BONDS 

closely tracking US develop- 
ments. with today's release of 
October producer prices expec- 
ted to be keenly watched. 

■ German bunds rose by more 
than % point, buoyed by the 
rally in US Treasuries and the 
smooth auction of another 
large chunk of the govern- 
ment's latest 10-year bond. The 
December bund future on DTB 
rose 0.58 to 89.98. 

The Bundesbank sold 


DM3.99bn of the 7.5 per cent 
bonds at 99J2 and above. The 
weighted average Issue price 
was 99.84, With an average 
yield of 7.52 per cent 

Market participants today 
will be watching the meeting 
of the Bundesbank’s policy- 
making central bank council, 
although most dealers said 
they were not expecting a 
change in official interest 
rates, nor a return to a system 
of variable-rate securities 
repurchase agreements. 

■ UK gilts followed US and 
European bond markets 
higher, with the December gilt 
futures contract rising by A to 
101 &. 

Most of the gains were in the 
futures market, however, with 
dealers reporting very little 
investor participation. Apart 
from awaiting the FOMC meet- 
ing. dealers are also looking to 
next week’s raft of UK eco- 
nomic indicators, including 
retail prices and jobs data. 


m French bonds slightly out- 
performed bunds, causing their 
yield premium over the Ger- 
man 10-year benchmark to foil 
to G9 from 71 basis points. 

However, political uncer- 
tainty and intra-party bicker- 
ing in the right-wing camp 
ahead of the Presidential elec- 
tions in May are likely to con- 
tinue weighing on bonds In 
coming months, panging them 
to under-perforin bunds, said 
Mr Adrian Owens, European 
economist at Yamaichi. 

“There's only one way that 
spread will go." he said, pHHbig 
he expects the yield gap to 
widen to around 90 basis 
points by year-end. 

■ Italian bonds also rose 
sharply, buoyed by strength in 
other markets, the breach of 
key technical resistance on the 
BTP futures contract and 
recent calm on the political 
front. The December BTP 
future on LifTe rose 0.68 to 
101.03. 


EIB follows sterling issue with L400bn deal 


By Richard Lapper 
and Martin Brice 

Following its £200m issue on 
Tuesday, the European Invest- 
ment Bank launched a L400bn 
bond, led by BNL, BCI and 
Cariplo and fungible with an 
outstanding L500bn. 

BNL said the deal met strong 

INTERNATIONAL 

BONDS 

demand from institutional and 
retail investors in Italy and the 
Benelux countries. 

There were a number of 
Issues at the short »nd of die 
dollar sector, again following 
recent trends. A $250m two- 
year bond, issued by SBC 
Finance Cayman islands, a fin- 
ancing company owned by 


SBC, and priced at 8 basis 
points above the equivalent US 
Treasury, was well received 
according to SBC, which led 
the issue, with strong demand 
from Swiss institutional and 
retail investors. 

Merrill Lynch also saw good 
demand from European inves- 
tors for its flOOm Boating-rate 
note issue, paying a coupon of 
20 basis points over three- 
month Libor. The FRN was the 
second by Merrill this year. 

European, Asian and Latin 
American investors were 
attracted by a $65m three-year 
issue by Cretfibanco, a Brazil- 
ian bank, priced at 430 basis 
points over the equivalent 
Treasury and led by Paribas. 

The issue was planned before 
the Brazilian government's 
recent decision to increase the 
tax on eurobond issues from 3 


NEW INTERNATIONAL BOND ISSUES 



Amount 

Coupon 

Price 

Maturity 

Fees 

Spread Book runner 

Borrower 

■V 

•* 



% 

bp 

US DOLLARS 







Uemtapherea Funding Corpl 

300 

W 

100 OR 

Nov-2001 

aaon 

- Goldman Sacha mti 

SBC Finance Cayman (stand a 

2S0 

7.125 

99.873 

Dec. 1806 

0.1253 

*6 05^90-90) SBC 

Men* Lyncn & Co4 

100 

(O 

100.00 

Feb-2000 

(cl 

Marr* Lynch (ml. 

Crwflbanco 

85 

11.825# 

09.9en 

Nov. 1897 

1.QOR 

+430{rN%-97) Paribas Cap. Mkis. 

YEN 







Sec&tate da Franco 

30bn 

4.75 

0a7UR 

Dec-2001 

0300 

Nomura IntL 

TTAUAN LRE 







European Investment 

4O0te 

7.625 

96.195 

Mov. 1986 

1.125 

BNL 


Final (arms and non-caSobto (taeaa stated. The yield spread (over relevant government tend) at launch te auppted ay the load 
manager. MHtated. tCenverttte. $Wfch acuity warrants, ^floating rale rum. ISend-annual coupon. R: brad rthoffer price; fees are 
shown at lha re-offer hvet a) Pays 3 morth LJbOf + 48bp. Ctaatote on any payment data at pa pkjs accrued interest, p) Fungible with 
existing LhaSOObn deal + 20 days acaniad Merest, c) Coupon pays 3 month Libor ♦ 20bp. Fees tixtectased 


per cent to 7 per cent Dealers 
say the tax increase is unlikely 
to dissuade new issuers, and 
point to a number of banks lin- 
ing up sizeable deals over the 
next two to three weeks. 

Hemispheric Funding Corpo- 
rate Series 1994A, a special- 


purpose funding vehicle, 
launched $300m of floating-rate 
notes. The issue, led by Gold- 
man Sachs, is guaranteed by 
Capital Markets Assurance 
Corporation, a US financial 
guarantee insurance company 
which enjoys a triple A rating. 


Electricity de France made a 
rare appearance in the euro- 
markets with a Y30bn deal 
with a 4V, per cent coupon via 
Nomura, which said the deal 
met strong demand in Tokyo, 
with very few bonds placed in 
Europe. 


Lawsuits may force ruling 
on interest rate futures 


Two large commercial 
end-users of derivatives, Gib- 
son Greetings Company and 
Ohio-based Procter and Gam- 
ble, are suing their long-time 
financial adviser, saying in 
separate cases that Bankers 
Trust failed to disclose fully 
the risks and terms of interest 
rate swaps that turned into sig- 
nificant loss-makers when US 
rates turned higher early this 
year. 

This by now is old news. 
However, the cases have the 
potential to be landmarks in 
the debate over derivatives reg- 
ulation for at least two rea- 
sons. 

First, if the suits are not set- 
tled and progress to trial, the 
world will be treated to its first 
intimate glimpse of how the 
massive private bank market 
in swaps really operates. 

In spite of numerous authori- 
tative studies of over-the- 
counter derivatives markets 
during the past 18 months, 
none has actually dissected the 
mechanics of an individual 
trade nor described the confi- 
dential courtship and consu- 
mating exchanges that occur 
between counterparties. 

Investment banks, who serve 
as adviser, designer and 
counterparty in these tailored 
trades, and often also calculate 
the price base for the cash 
str eams they generate, may as 
an industry find themselves 
uncomfortable with the 
detailed disclosure the judicial 
fact- finding process requires. 

Swaps dealers contend that 
they act in the best interest of 
their clients, and value the 
long-term relationship. How- 
ever, potential conflicts of 
interest can only be high- 
lighted by the discovery pro- 
cess. 

Second, both Procter and 
Gamble and Gibson Greetings 
have brought their suits to the 
federal courts under the anti- 
fraud and anti-manipulation 


provisions of the Commodity 
Exchange Act the body of law 
that governs US futures and 
options on futures. 

To be successful in this pur- 
suit the companies will have 
to prove that the interest rate 
swaps in question are futures, 
and as such, are subject to 
oversight by the Commodity 
Futures Trading Commission, 
the US futures regulator. 

Many derivatives players 
sniff at this strategy, saying it 
is generally accepted that OTC 
swaps are not futures. The 

DERIVATIVES 


CFTC contributed to this per- 
ception in 1992. when it 
exempted OTC swaps transac- 
tions from most of its oversight 
authority. In fact, US law has 
no clear definition of what a 
“future" is, and the CFTC 
avoided the issue when grant- 
ing its swaps exemption. 

US law does require that 
anything judged a futures con- 
tract be traded on a listed 
exchange. Thus, as the swaps 
industry developed, it hung at 
the edge of legi timac y, if a dis- 
gruntled counterparty sned, 
and proved in court that a 
swap was a future, the con- 
tract could immediately be 
deemed illegal, because it was 
traded off-exchange. 

The CETC’s 1992 exemption 
lifted that judicial jeopardy, 
effectively saying: “If a swap is 
found to be a future, it doesn't 
have to be exchange-traded to 
be legal." However, that swap 
would still have to comply 
with the agency’s anti-fraud 
rules. 

Ms Mary Schapiro, the 
CFTC’s new chairperson, may 
actually be supporting a new 
view that swaps could be 
futures, by saying she wants to 
review the suitability require- 
ments for institutional 
counterparties that is cur- 


rently contained in the exemp- 
tion. She Is also considering 
creating an office within her 
agency that deals solely with 
OTC derivatives, and reports 
directly to her. 

Further, she has indicated 
that she would tike to write 
stand-alone anti-fraud provi- 
sions for swaps, since the exist- 
ing ones for listed futures do 
not transfer sensibly to OTC 
markets. 

Ms Schapiro, who has bi-par- 
tisan support in Washington 
and comes to the CFTC from a 
seat on the Securities and 
Exchange Commission, may in 
fact be jockeying to fill in a 
regulatory void in Washington. 
The older and larger SEC only 
has jurisdiction over swaps 
that can be proved to have 
securities components, while 
the CFTC can govern swaps 
only if they can be proved to 
be futures, which to date has 
not happened. 

Taking a leadership role and 
assuming the OTC derivatives 
turf for her agency mi gh t be a 
politically astute move for Ms 
Schapiro, who, uniiirg her pre- 
decessors, enjoys unusual sup- 
port from the SEC. In doing so, 
she is aware she will have to 
shed her agency's reputation 
as a limp regulator. 

Industry attorneys point out 
that the recent spate of deriva- 
tives lawsuits in itself proves 
an Industry contention that 
additional regulation is not 
needed for swaps: that big, 
sophisticated companies enter- 
ing into derivatives contracts 
have the resources to fight out 
their disagreements through 
the courts, and do not need 
special government protection. 

*1 can't think of any federal 
regulation that could have 
been written that would have 
kept Procter and Gamble from 
losing what it alleges it lost,” 
says one Washington lawyer. 

Laurie Morse 


u H r£V" 2r« 

Trust Drasm 

(f&Fcaccs T-rs 

:3*2 fcsl-a fee 

57! 3 SAT 

- .-i - "7-ct 

- -^= 

... • ' m -f' 




WORLD BOND PRICES 


BENCHMARK GOVERNMENT BONDS 

Rad Day" 

. . Coupon Date Price chans 


Day's Week Month 

Price change YMd ago ago 


Austntaa 

EMptem 

Canada* 

Denmark 

Franca 

Germany T«u 
Italy 

Japan' N 

Japan N 


US Treasury ' 


9.000 OBAK 

7.760 10/04 

6500 08/04 

7JJOO 12/04 

BTAN a 000 06/96 

OAT 5500 0-004 

U 7600 03/04 

aaoo os/04 
No lie 4£00 -OB/99 

No 154 4.100 12*3 

7.250 10/04 

9600 06/04 

8.000 08/99 

8.750 11/04 

9.000 KMK 

• 7290 08/04 

7.500 11/24 

Govt) R000 04/04 


BCU (French Govt) ROM 04/04 
Uauton ctoahv, 'Tinr York ratd-day 
t Ocas fndudng wUtaktng tax at 125 par 
Prices; US, UK In 32nds. Mhars in decimal 

US INTEREST RATES 

LuncMra 

Diaunli- 

Prewitt 7% TMttanOt. 

fietarkaartt: B>j UnammSv 

FedJmds «U fcraoBBt — 

fadJtna at MothAil. - Qeejtt— 


89.7800 ->0060 1070 1068 1020 

952900 +0.690 032 056 045 

803500 40490 8.16 922 9.00 

872900 40430 097 004 094 

1 0T 2750 40250 750 7.66 7.48 

8SL7B00 40540 OT6 039 011 

99.6600 *0840 701 7.80 7.56 

81.79M 40580 T1.68T 11-89 11.75 

1007380 - 4.10 ' 4.06 4.16 

95.7160 -0120 4.78 469 4.78 

979200 40880 785 789 782 

- 1121 1169 

90-11 +9/32 680 883 8.42 

87-19 +15/32 88E 8.74 889 

103-08 +17/32 860 870 859 

95-10 +14/32 7.95 786 7.68 

93-13 +20/32 808 809 7.89 

886700 +0810 858 878 8M 

YhfcWs Local market erenrtanL 
cent payable by nonraeidanati 

S«jc«c UUS kemmtloned 


Tnauy Bflk and Bond iMda 

5.72 Ttt year 

, U8 Itnsiaai 

535 Rnyaar. 

5JB 10-jtar 

832 30y» 


I ta ly 

■ NOTIONAL ITALIAN GOVT. BOND (BTP) FUTURES 

(UFFEf Lira 20Qm lOOttia ot 1QQH 

Open Sod price Change Hj^i Low EsL vof Open kit 
Dec 100.48 101.17 4082 101.37 10048 42906 48935 

Mar 9840 10001 4079 100.13 9840 476 8932 

m fTALIrtW GOVT. BONO (BTP) FUTURES OPTKTW8 (UFFF) UraZDOm IQOlha C* 10014 
strike ■ : ■■■ CALLS ■ ■ ■■■- — PUIS — 


1 l.ov 

4.06 

■ 1.(3 

4.16 

Price 

Dec 

Mar 

Dec 

Mer 

469 

478 

1O10O 

081 

ISO 

0.64 

2.92 

768 

7S2 

10160 

055 

1.72 

088 

3J21 

11JI 

1168 

10200 

OSS 

163 

1.10 

052 


Ear. WL ana). Cob 2273 Puts 200SL Pnotous day-8 open It. CBM 25688 PWs 312B2 


FT-ACTU ARIES FIXED IN T ERES T INDICES 

Price Indices Wed Day's Tue Accrued 

UK Gits New 9 Change % Nov 8 interest 

1 Up to 5 years (24) 119.58 4021 11930 133 

2 5-15 yaws {23) 13896 4850 13826 131 

3 Ouar IS years (8) 15882 >068 154.76 2.40 

4 bredeemtttee (8) 174.94 4047 174.12 038 

5 Al stocks (61) 13841 4044 13531 1.70 


6 Up to 5 years (2) 18889 40.01 18528 852 

7 Ouar 5 years (1 1) 17151 40. JO 17834 0.97 

8 AB stock* {13) 173.92 *009 173.76 0.92 

Debentures and Loan* 

9 Debs A Loans (77) 127.74 *0.68 12628 2.40 

< Wn g» grew radampdon yMdi ars ban above. Capon Baidc Low: 0W-7P16; 


xd ed). — Law coupon yield-— — MarSum coupon yMd — — High cation yMd — 

ytd Nov 9 Now 8 Yr. ago Nov 9 Nov 8 Yr. 390 Nov 9 Nov 8 Vr. ago 

883 5 yn 857 825 811 821 629 B38 877 8.88 860 

11.48 15 yrs 851 858 7.06 864 872 7.19 826 895 739 

1027 20 yrs 8^8 854 7.17 864 872 724 879 8.86 7.41 

1337 Irrad-t 857 881 729 

10.93 

MMfon 8% Inflation 10% 

Nov 6 Nov B Yr. ago Nov 9 Nov 6 Vr. ago 

5.07 Up to 5 yrs 428 427 235 228 895 126 

436 Over 5 yrs 337 328 175 329 IBS 298 

4.4i 

5 year yield IS year yield 2S year yfoW 

Nov 9 Nov B Vr. ago Nov 9 Nov a Yr. ago Nov 9 Nov 8 Yr. ago 

867 886 874 7.72 861 869 814 9.67 865 829 

Marflart 894-10*%; H0r 11% and over, f FOB yUU. yW Year data. 


428 427 

327 328 


5 year yMd — 

Nov 9 Nov B Yr. 


228 895 136 
329 329 299 


Spain 

■ NOTIONAL 8PANSH BOND FUTURES (METF) Nov 8 

Open Sett priea Change High Low 
DSC 6810 8819 *028 8819 85.97 


EsL voL Open hit 
26249 77316 


FT FIXED INTER ES T INDICES 

Nov 9 Nov 8 Nov 7 Nov 4 Nov 3 Yr ago H0i* Low* 


GILT EDGED ACTIVITY INDICES 

Nov 8 Nov 7 Nov 4 


BOND FUTURES AND OPTIONS 
Franco 

■ NOTIONAL FRENCH BOND R/IURES (MAT1H 



Open 

Sett price 

Change 

Hgh 

Low 

EsL vol 

Open btt. 

Dec 

110-28 

11078 

+070 

11086 

11060 

107,982 

133600 

Mar 

109.40 

10094 

+070 

11064 

109.40 

750 

12653 

Jita 

10056 

108.10 

+0.70 

109.18 

loose 

82 

3090 


■ MOTIONAL UK G8T FUTURES (UFFST ESQ, POO 32ndao1100% 

Open Sett price Change Hfch Low Est voi Open inL 
DSC 101-05 101-19 *0-19 101-23 101-04 58517 106632 

Mar 100-19 100-25 *0-17 100-27 100-18 1OS0 62 

■ LONG OCT FUTURES OPTIONS (UFFQ ESO.OM 64tha ot 100% 

Strto - CALLS PUTS 


Govt. Secs. (UK) 9139 9029 9124 91.69 91.45 10228 107.04 8924 GJK Edged baa 

Fixed M e r e st 107.69 10729 10801 107.B4 107.82 12338 13187 10620 5-day a verage 

' tar 1994 Gmwm Sawtm Once co r v —Bon: 127.40 (an/35, low 49.18 (V1/7SL Rxfld Inmat h&i Wnce conpb 
ZB and Rnfl Imwrwr 1QZS. SE octwriy Inch** ratoamd 1974. 


FT/1SMA INTERNATIONAL BOND SERVICE 


IK 684 786 882 783 67.3 

82 2 81.6 81.7 79.0 002 

5 13187 (21 7UB6 . 1“ HLS3 W1//S) . Bade 10ft CknwnvnaM SeeurtHat isnw 


Latad are Via ataatr 


aona( bonds tor wtieti tore a an edaqi 
Issued Bd Offer ChS- Yldd 


adaqiKe saconday msM. Latest pricaa at TOO pm on I 


US. DOLLAR STOAJGHTS 


Price 

Dec 

Mar 

Dae 

Mar 

Abbey Nti Treasuy 8*2 OS 10CO 

87% 

87% 

♦% 

860 

101 

1-06 

1-63 

0-32 

2-13 

Afeena fiwteoa 7% 98 1000 

98% 

98% 

♦% 

aco 

1Q2 

0-36 

1-34 

0*2 

2-46 

Austria 8% ® 400 

101% 

ICC 

t% 

STB 

103 

0-15 

1-10 

1-41 

3-24 

Bank Ned Gemeantcn 7® 1000 

96% 

96% 

+% 

739 


■ LONGTERM FRENCH BOND OPTIONS (MATTF) 


Sufloa 

Price 

- Dec 

— CALLS — 
Mer 

Jun 

Nov 

— PUIS — 
Dec 

Mar 

110 

1.15 

1.72 

- 

pas 

162 

2.70 

ill 

OlSI 

- 

- 

a78 

- 

- 

112 

Oil 

066 

- 

1v46 

- 

- 

113 

067 

058 

- 

260 

- 

- 

114 

063 

064 

- 

- 

- 

■ 


Bs. voL M4 Cdfe 5661 Puts S039. Asvwua day's open tat, Cato 7S4S7 Putt 46485 


Ecu 

■ BCU BOMP FUIWES (MAUF) 

Open Sett price Change 
Dec 80.16 6872 *864 


Low E«. voi. Open InL 
8816 4224 8752 




• Eat. uoL toad. Cwts 26.292 Pm <7.032 . Piwtoun day 1 * erwt M., cefc 2S&424 Pi*a 385^77. 

Germany 

■ NOTIONAL OBBMAN BUND FUTUBE3 QJffW 0M2602M IQOtha d 10094 

^ Open Sett price Change High Law Eat vd Open W. 

L ? Dec 8920 PQ 01 +088 90.14 8846 210616 180872 

of 8860 8801 +863 8815 8847 13018 17982 


■ US TREASURY BOND RJTURES (CSX) $100200 32nda of 10044 



Open 

Latest 

Change 

Kgh 

Low 

Est vol. 

Open nt 

Dec 

96-27 

97-07 

+0-15 

97-11 

96-24 

286.701 

392.282 

Mar 

96-05 

96-18 

+0-15 

96-22 

96-05 

12.362 

20637 

Are 

96-01 

96-00 

+O-10 

96-03 

9S-29 

129 

11305 


■ BUHti FUTURES OPTIONS (UFFE) 0M2502M PQinta of 10096 

Strike CALLS PUIS — 

PrWn Dec Jen Fat> Mar tec Jan Feb 


Stifles 

Price 

Dec 

Jon 

CALLS - 
Fab 

Mar 

Dec 

9000 

9080 

9100 

060 

066 

062 

OjSO 

035 

024 

075 

066 

043 

092 

073 

068 

059 

087 

161 


Etf. voL nd, Cto 33236 Pula 2DS68. Pravloua «MyM open InL, Orife Z837S3 Ptt Z24159 


UK GILTS PRICES 


Japan 

■ NOTIONAL LONG 7BU4 JAPANESE GOVT. BOND FUTURES 

(UFFE) YIQOm IQOtfia of 100% 

Open Ctoee Change Hgh Low Est vol Open ML 
Dec 107.69 - - 10720 107.39 4558 0 

Mar 10628 - 10627 10627 701 0 

* UFFE corP aU a traded on APT. A* open Manat Itae. an to pmku day 


Mata C IM Ptoae + or- 


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but tape an3-i7— 


*55 97* + J i 97? 05 

Ass Ifflti HWi S 01 ! 


855 97* 
858 «1» 
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878 107% 
804 112d 


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Com 3J*pe WAn. 

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1941a CoaBdaZ^BG 

KBS flaw. f%pc . — 


737 73g 
871 10S 

M2 87%M 

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80S 105% 
100121 Ari 
UO 83*i 
80S 95 

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SLOT 127b 
MB 103* 
853 


7.70 844 &g!M 

8GB 857 10% 
800 855 IMS 
745 ' . 833 73fi 
840 - 049 95% 
836 840 32!! 

853 .^847 N Ell 
922 17l130iV»1 


871.'.- 45ii 
851 41 Vat 

80S _ STi 

870 ^ 34S 

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1* ^ 20} 


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+17 125% 
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+fi 111% 
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llTfi 
♦% 114% 
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■a s*n 

+A 71 
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38% 
■* 37% 


tott-Udtt » 

2*08 3) 289 424 18912 

4%pC96tt (13M) ZJ7 3J6 107 

2%PC‘01~ [78? 3.44 385 155IJ 

2%pCU3 (713) 154 1871 61 %« 

4%pcU4tt — (1358) 3J6 327 108% 
2pe *05 1633 380 325 168ft 


203% 1S7JJ 

— Ill* lOBft 
+% 170% 163% 
+% 173% 153ft 

♦% 118% 107% 
+% 104U 165ft 


2%PCTS (7681 165 128152%* *ft 168ft 146% 

2%pe11 (74 6) 327 186 157% ♦% 115% 1B4% 

2%pe T3 (Bta 3M 326 129% +% '46% 126% 

a%pe16 (B1J3 171 327 130A t% 157ft 134% 

aitfeU). (032) 374 326 132% ♦% 1S2ii 128% 

a%pe'34i±.__4S7.7) 3.72 325 110% +% ISft 106% 

P35.1) 378 329 109% r% IZBft 105% 

FreapadSve real redamptot ratoon protected rtlattan offl) 109* 
and P) 5*. (b) figurw In p fe anlh mg show RP1 boM tor 
mooting fa B mtyttraprior to issub) and how been adjusted to 
reDect rebtttipg ol HPI to 100 In Fetxuay 1967. Converetan 
foeftir 3245. RPf for FafaruBry 1SW: U&1 ana tar September 
1904; 145.0- 


Other Fixed Interest 


Md ig^ 

RM MCfE + or- Wgh Ion 


’ «BnOar(0%pc2OO9_ 

BTamll%pcaoi2 

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92 4 (0011 

159 116% 

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- 106% 

923 1«jJ 

- IS 

- 36% 

- 32% 

028 113% 
832 SB 
4.S4 133 

422 126% 

- 136% 


138% WA 

142 175 

*% 116% 93% 

*% 103% 99% 

115% 106 

.. iSBji 13111 
140% 175 

. 44% 33% 

40% 28% 
(S6% ru% 
78 66% 

_ 150% 1 29% 

145* 4 123% 

... 159% 114% 


Ba* cl Tokyo 8% 96 100 W1 

BelgLri 5% CQ 1000 81% 

BfCE ?\ or (50 100% 

Brtcfi GfflO+1 1500 9% 

Cnda 9 96 1000 107% 

Cheuig Kong fin 5% 98 500 8B% 

Ctea6% 04 1C 00 83% 

Card Euaoe 8 96 100 101 

Credk Frxow 0% 99 300 K>5% 

Dome# 5% t£ (000 94% 

fiast2panA*WK8%0« BCD 87% 

E€SCB% 98 193 101% 

EEC 8% 96 100 101% 

08 7% 96 250 100% 

0B9% 07 1000 10«% 

Bee da fitnee 9 96 200 103% 

Euofera9%96 KM 102% 

&-tn Bar* Japai 0 0? 500 96% 

&8WlDwCnp9%9e 150 1D»% 

Faded Nad Mori 7.40 04 1500 94% 

firfand 6% 97 3000 97% 

Fed Matar Credl 6% 98 1500 B6% 

Gan Bee Ctetol 0% 98 300 102% 

GfcMC 9% 96 200 101% 

lnd & J*an Fta 7% 07 200 99% 

ha Ams Dew 7% 96 200 100% 

Ktiy8%23 3500 76% 

Japan De* Bh 8% 01 500 100% 

Kane Bac Pm 10 96 -i i_- 350 103% 

KoeaBeclW6%03( 1 1350 83% 

LTC8 Fh 8 97 300 100 

Matszftt Bac 7% CE 1000 93% 

Noway 7% 97 1000 99% 

Orac 7% 03 3000 93% 

CMr Kotatfea* 6% 01 200 101% 

PttHJanatta 7% 9S 200 89% 

Pcrtirpal 5% (B 1000 83 

Ctatw Hydro 9%9B ISO 104% 

i2otecPm998 200 107% 

Sataboy 0% SS ISO KB% 

SAS 1099 330 103% 

SNCFB% 98 150 1W% 

SparB 1 ; SB 1500 03% 

St* a nsw s% tt a» fffi% 

Sandtii 5% 95 2300 98% 

SMKfe* Ear 8% 96 700 101% 

Tc**j Bee Power 6% 03 1000 69% 


754 
4% 855 

+% 720 

♦*4 908 

727 

4% 818 

■Ji 834 

4% 7X3 

4% am 

4% 728 

Jg B55 
756 


Jrttd Kingdom 7% 97 5500 101 101% 

VcAswagan hi fin 7 CQ WOO 83% 84*4 

World Bark 0 15 2000 20% 21 

MWBs*5%03 50® 86% 89% 

World Barit 8% 00 1250 100% 112% 


SWflSS FRANC STRAIGHTS 

Asm Dw 8 w* 8 TO 

Austria 4% 00 

Caret Brape 4% 96 

Denmak4 ] 499 

EB6%M 

BKdsFme7%06 

FWwt7%88 

Hyundai Motor fin 8% 97 

kttnd 7%S0 

Kdba6%0l 


735 

Ontario 0% 03 

400 

722 

700 

Quebec Hydro 6 06 

SNCF704 

— 100 
4® 

76 

727 

World Bare 5 03 — — 
VHcrtd Bank 7 01 

- 1® 
000 

831 

730 

840 

YBI STRAK3HTS 

75000 

763 

96% CO 

1 00000 

aoz 

firtandrise 

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-TOD 96% 
.1000 06% 
-250 98% 

,1000 95% 

-300 K5% 

_ 100 10B 

-300 WB% 
- 100 105*2 
-ICO 106% 
-240 103% 


4% 755 

ac7 

4% 750 

+% 927 

4% 628 

730 
4% 922 

4% 738 

4% 85t 

4% 7A5 

4% 664 

4*« 625 


tar Anar Qsv 7% 00 

Wy3%01 — 

Japai Dev 0k 5 90 

Japan Dev Ok 6% 01 

Nppon Tti Td 5% 96 

Ncnrer5%97 

SNCF6% 00 

Spate S%(K 

Swetfai 4% 98 

Wbrirf Bar* 5% 02 

OTId STRAIGHTS 
Gat*arcebiiB%90lfir_ 
KB Oau Mao* 9% 03 LFr . 


30000 112% 


.300000 81% 
.100000 102% 
.120000 109% 
-50000 104% 
. 150000 103% 
-30000 109% 
.125000 105 

. 160000 101% 
.250000 102% 


.1000 104% 
. 3000 100 


Cba. YMd 

4% 674 

nns 

4% 723 

-% 776 

4% 655 


4% 622 

4% 527 

6.12 
4% 523 

4% BJD3 
4% 623 

569 
631 
S18 
56S 

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673 
4% SSI 
560 
4% 580 


-% 461 

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334 
-% 460 

-% 609 

^ 462 

-% 369 

3£7 
-% ABB 
4B2 
420 
-% 460 


AU*y tod Trraiiy 8 03 2 . 

ABanco Ltta 11% 97 C 

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Dan<tac»%aS£ 

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HAs 10%97E 

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TUqn Sac ftaear 11 01 £ _ 
Abbey Nadonri 0 SB NZS —— 

TTXZ Fh 9% Q2N2S 

Cradl Local 6 01 Fr 

Bac defiance 8% 22 FTir_ 
SNCF0%07fi=r 


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-.100 W5% 
_ 160 89% 
-800 83% 

- 637 103% 

- 100 XB% 
-500 103% 
_ 153 109% 

- 400 106% 

-200 91% 

-200 07% 

_ WO 107% 
-250 08% 

-150 100% 

- 150 107% 

- 100 34% 

- 75 86% 

.7000 B8% 
,3000 80% 
. WOO 104% 


Ofcr Chg. YMd 

82 4% 645 

106% 860 

80% 41% 1027 
83% *% 8.78 

1<B% 4% 831 

104% 648 

103% 4% 691 

K»% ♦% ttM 

100% 4% 8.73 

02 4% 664 

96% 4% an 

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96% 4% 946 

100% 4% 925 

106% 4% 922 

85% 934 

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66% 4% 622 

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104% 4% 720 


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751 

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103 


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103% 

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103% 

104% 


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— 150 

104% 

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&43 

. IS 

1W% 

105% 

+% 

784 

finish Cetanbto S) 06 CS 

— SOO 

102% 

103% 


am 

1500 

93% 

94 

*% 

80S 

EE 10% 96 CS 

130 

106% 

108% 


8.15 


Tokyo Meoagufe 06 . 
ToyoaM(*»5%9B — 
IMBd Kington 7% 02 - 

ttjrtl &r* B% 90 

WaridBerk 8% 97 


-200 101 % 
,1500 94 

.3000 94% 
. 1500 103% 
1500 103% 


DEUTSCHE IMRK STRAIGHTS 

Avars 6% 34 2000 61% 

Credl FbncNr 7% 03 2000 96% 


Demerit 5% 98 

Depte Ftase 6% 03 _ 
E&ehe ft fte 7% CD . 

EC 6% 00 

BBB% 00 

Fr*and7%00 

toiy?%S8 


— 2000 97% 

— 1500 00% 

— 2000 37% 

— 2900 96% 

1500 95% 

— 3000 100% 

— 5000 100% 


LKB BatovVArra 6% 06 2250 88% 

Ncn*^6%98 1500 96% 

C«nJ&% W 1900 89% 

Span 7% 03 «00 96% 

Swedai8 97 2500 10£% 


4% 7.45 

hub 
726 
4% 647 

748 
4% 7.70 

4% 825 

+% 758 

4% 728 


61% *% 8.18 

96% 4% 763 

97% 4^ 557 

91 4% 763 

98% 4% 762 

96% ♦% 760 

95% 730 

100% 4% 743 

100h ^ 7.10 

07 4% 8.12 

68% 4% 6.73 

89% 4^ 766 

96% 741 

102% 4% 769 


Bac da fists 275 102% 

GenaeCaptalOSCJ 300 102% 

MW H fin 10 01 CS 400 1(2% 

fta*n TeiTef 10% 99 CS 200 104 

OwaldSmcS 1500 01% 

Ontario ttydffl 10% 96CS 500 105% 

OslCf KdmtEtiPk 10% 99 CS — . 150 104 

OjehecPrw 10*2 96C3 200 104 

BagunriSEor -1250 102% 

Card Eusps 9 01 Ecu 1W0 101% 

CrgdtLyomisOSEcii 125 101% 

BB 10 37 Ecu 1125 104% 

Fsto del S&t 10% K Ea SOD 104% 

taV 10% QQ Ecu 1C0D 107% 

SpainS 96 Bar 1000 102% 

thud (Ongdon 9% 01 Ecu — 279) 102% 

NEC 1099 AS 100 99% 

Gtxnn BH Abb* 13% 99 AS _ 100 111% 

SB 7% 99 AS 350 02% 

NSW7iaBuyZaP.02PA$ — 1000 7% 

H8 IBs* 7% 03 A3 —.125 02% 

SbtofttSWeCDAS 300 69% 

ah/WtQ0*fti9Q2AS IS 88% 

(MMrAusnreiZSBAS IS t«% 

Weston Auai Res 7% 08 AS — 100 32% 


— 200 104 

-.1250 102% 
1100 101% 

— 125 101% 
.1125 104% 

SDO 104% 

_1BB 107% 
-1000 102% 

— 27S 102% 

— IS 99% 
1-100 111% 

— 350 02% 

— 1000 7% 

— 125 62% 

— 300 89% 

— IS 88% 

— IS T«% 


4% &10 

4% 949 

4% 920 

4% 950 

4% 923 

4% SU 

4% 827 

7.17 
4% 673 

4% 7.75 

4% 7.72 

4% 638 

«% 684 

4% 726 

4% 055 

4% 1021 

4% 1085 
4% 964 

4% 1039 
4% tt* 

4 % uxn 

4% 1160 
4% 1041 
4% 1019 


HXMIMQ RATE NOIB8 

terared BM Otar Capo 

MtfreyfMTreaatiy-AS 1000 9942 9832 46375 

Banco (term 0 89 200 9692 10002 56825 

8rigunft97DM 500 10612 10023 5.1250 

BFCE-4UBS 350 9677 B968 47300 

BMsntaaiOSC ISO BOSS 1000S &10CD 

Caneda-%® 2000 8927 9632 6502& 

DCCE006 Ecu 200 0802 9623 56229 

Crera lyormas ft 00 300 0744 9864 63125 

□erensk-%S JOB S9L54 8684 SOBS 

Dreartear Ftaca ft 98 DM 1000 8699 10008 &2TS 

FsrotMSaai0B7 420 9987 10068 5.1000 

FHand097 1000 8982 10001 B3750 

tefendOn 300 40800 

Uy%96 2000 10614 100.19 56000 

LKB BadanmMjst fin -% B0 1000 9045 8865 58750 

Lloyds Bark Pap saw COO 8366 8468 54125 

Mates* ft 05 -BS 99.19 6838 5SJ7S 

Ne»Zatiand-%S 1000 9868 9873 54453 

OrtaloDSg —2000 0960 9067 48375 

ReNb 0 98 i 500 0642 9968 5.1250 

SKfeteQerwttDS 300 8960 BB70 63750 

SuattearfcBaAi -005 8801 - 8000 9983 8987 52000 

SUs 8k Maori* 0 jQ5 BO 125 0B79 IOOjOI 5.1125 

9aredan0tt 1000 0865 9880 58000 

Saeden-%01 2000 0064 9874 56875 

Uhted Kkrgteffl-% 96 4000 9879 9962 5*00 


CONVemttLE BONDS 


Bitaigferiis 6% 06 — 

Chutti Ceptal 6 9B 

Gcta Kd^toto 7 ! 2 00 - 

Hanaon0%O0C 

HaBcnAniBika2690l . 
Hog Kong Land 4 01 _ 

ltttSec36%02E 

Lnn7%(B£ 

UaiBrt2%09 

Mart te fin 8% 87 

KM fires 6% 08 e 

O&felSO? 

firred 4% 03 

Snn4moftnl:3%04-. 
&reAMa7%08C — 
TeecoCBpUSBE — 
Tsas tese u i tm 2% 02 . 
• No Mamretan Mtofto 
HMraamriento 


had Mbb ad OBrr Print 

mo 82% 09% 91 486* 

250 06 100% 101% 42167 

85 1J06&4 HB% 111 433.19 

500 26975 103% 101 +1742 

WOO 72% 73 

410 3165 78% 70% -2144 

84 £72 95% 97% 4463 

90 564 80% 82% 

200 23326 04% 00% *1174 

10) 2283 100 101 +1069 

250 433 110% 117% 1002 

85 39677 81 02% *6264 

500 686097 00 89 +1037 

300 35053 75% 78% +1761 

— 155 33 97% 90% +14.44 

200 261 110% 114% 10067 

300 02% 98% S% <044 

■ prerirw rtay% price 

' a*pted a price 


STRAX3KT BOtrcS: The yield e tee yield to redampdori <4 •» htastec*: tee anttrt Bsuad b h mtione d oanrey into. Oig. d^oOrenge on d^i. . 1 

FUMim RATE NOTTS: Psrtvnriatad n dotoa into odi nesa ntcseO. Cajxn ttren h rrUtrun Spreet hU e t Oin abwe ttwtii Saw a» tmte-rna#} iebap mean mad tar UB Cfctta. CjpnaT(a cnant 

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aim wfcctai p»o« or urtto 9aes <to rho bond o»ar me mote i»i 9 priea rt me atom. 

O The FnnM Taraa Lta, taw ffcproducaer. m Me or m pot n my taro n* ponttM trim wter ranter*. Qua by tarmria n al Sacufea: MiM tancten 


t -*4* * WMttrta* « Aucri* tatt. ari & tt«PKL Cktorg a*^ «a tttt te pc^ 


r -few* 









Fb^vClAfc TIMES THURSDAY NOVEMBER 10 


COMPANY NEWS: UK 


Analysts trim forecasts as 13% profits growth disappoints City 

Amersham restricted to £19.6m 


By Daniel Green 

A disappointing performance 
in Japan and continental 
Europe limited first half profits 
growth at Amersham Interna- 
tionaL 

The health science group 
lifted pre-tax profits for the sis 
months to September 30 by 13 
per cent to £19.6m (£T7.4m) on 
sales up 6 per cent at £163. Im 
(£153.7mX 

Mr BOl Castell, chief execu- 
tive, acknowledged that the 
results were at the low end of 
analysts' expectations. The 
share price fell 63p to 928p. 

He said that the sluggishness 
of life sciences, the company’s 
largest division, bad been 
caused by bureaucratic delays 
in government funding of 
research, especially in Japan 
and France. Research laborato- 
ries are among Amersham ’s 
best customers. In addition, 
the dollar’s weakness boosted 


the competitiveness of US 
rivals. 

Life sciences’ operating prof- 
its were £ 15.3m (£i5.6m) on 
turnover of £744m (£72.4m). 

The industrial division, 
involved in industrial quality 
and safety assurance, also dis- 
appointed. A changing product 
line had added to costs without 
adding to sales, said Mr Cas- 
tell. Operating profits dropped 

from to ElJbn. 

The best perfo rming division 
was healthcare. Operating 
profits rose to £5.5m (£1.5m) 
thanks to the performance of 
new products - Metastron. for 
cancer pain, and Myoview far 
imaging the heart Turnover 
grew from £54.7m to £KL3m. 

Mr Castell said that the 
healthcare division would 
remain the “major profits 
driver in the near term”. 

Earnings per share were 12 
per cent higher at 208p (I8.6p) 
and the interim dividend 


Arocrsriam Inter t w rt to nai 

Sham prtce tttative to the 
FT-se-A Afl-Shwfi kKfaK 

m r — =-¥ r~ 


iso — — — HP ~ 


1993 1904 

SnacKfTSrapMM 

is raised from 44p to 4.9p. 

• COMMENT 

Amersham had fixe highest p/e 
in the UK health sector - 20.8 
- until yesterday’s results. The 
rating was based on prospects 
for Metastron, a drug which 
promises to take the company 


beyond lrwdiral imag in g into 

the potentially lucrative field 
of cancer treatment. However, 
doctors and drug regulators 
are conservative folk. Approv- 
als are slow in coming and 
buyers must be persuaded to 
change their prescribing hab- 
its. Add to that uncertainty 
over research spending in both 
public and private sectors as 
costs remain under scrutiny, 
and it is just as well that ana- 
lysts' forecasts have now been 
trimmed. Re-tax profits for the 
full year are likely to fell well 
short of £50m, with earnings 
per share just making it to 50p. 
Profits are forecast to grow at 
20 per cent next year, giving 
roughly £57m pre-tax and earn- 
ings of 60p. The 199546 pro- 
spective p/e of 155 is still close 
to the top of the sector. Amer- 
sham remains a long-term 
growth stock, but investors 
should brace themselves for 
more short-term weakness. 


Bibby falls £10.7m into the red 


By Peter Pearse 

J Bibby & Sons, the 
conglomerate, yesterday 
reported a tumble into pre-tax 
losses for the year to Septem- 
ber 24, after exceptional 
charges. 

However, the shares rose lOp 
to TOp as operating profits rose 
from £2l.lm to £29.&n. 

Bibby, which is 79 per cent 
owned by Barlow of South 
Africa, announced pre-tax 
losses of £10.7m (£7.07m prof- 
its) on turnover down at 


£764.6m, compared with 
£79L5m. 

firnqitinnai charges totalled 
£30.6m, relating to the £41.7m 
disposal in May of the agricul- 
tural feeds business to Associ- 
ated British Foods, and the 
cost of restructuring what is 
now the industrial division. 

The feeds business contrib- 
uted turnover of £2.95m 
(£359m). and there were losses 
of £20.4m from its disposal, the 
closure of operations and good- 
will 

Within continuing 


operations, there were losses of 
£6.72m from disposals, closures 
and goodwill and other 
restructuring costs of £3.48m. 

Mr Richard Manse 11-Jones, 
chairman, said: 'The restruct- 
uring of the group is mostly 
done and we have fully pro- 
vided for everything we can 

think of.” 

Interest charges were 
reduced to £10m (£14. lm). Bor- 
rowings fell to £82.1 m (£i225m) 
after the sale of the feeds busi- 
ness and a building in Spain. 
Lower rates, especially in 


Spain, also helped. 

Behind the operating profits 
rise, lay a sharp reduction in 
losses from capital equipment 
to £865,000 (£7. 15m) and a rise 
in the industrial division to 
£ll.lm (£9. 06m). The agricul- 
tural business made profits of 
£2.38m (£3 Jim) and materials 
handling, £16.4m (£16. lm). 

Losses per share emerged at 
1159p (earnings of 256p) and 
the total dividend is lilted to 3p 
(2p) via a final of 2p. A special 
dividend of 2p was also paid 
following the disposal. 


Last minute Glaxo fends off attack 

snag for 

Wellington on patents for Zantac 


snag for 
Wellington 

Lloyd’s of London yesterday 
created a last minute hitch for 
a new underwriting company 
planning a stock market list- 
ing when its ruling council 
faded to agree fresh roles for 
corporate investment in the 
insurance market, writes 
Ralph Atkins. 

Wellington Underwriting, 
which had announced plans to 
invest in seve n Lloyd’s syndi- 
cates ran by the Wellington 
managing agency, is dne to 
complete arrangements this 
week for placing 30m shares at 

100p. 

It had been awaiting Lloyd’s 
approval, originally expected 
last Friday, for arrangements 
to allow existing corporate 
vehicles to Invest in others. 


By DanM Green 

Glaxo, the drug company, bag 
fended off one of several 
attacks on pwtenta protecting 
its biggest seffing drug, Zantac, 
for ulcer treatment 

This increases the chances 
that Zantac will not have com- 
petition from generic rivals for 
a year beyond the expiry of 
one of the drug’s patents at the 
end of 1995. Zantac's US sales 
are running at about $2.2bn 
(£L34bn) a year. 

A US district court has 
rebuffed an application by 
Novopharm, the Canadian 
generics maker, that part of a 
Glaxo suit for patent infringe- 
ment against Novopharm be 


rejected. The decision means 
Glaxo 's case goes ahead as 
before. 

The first patents on Zanta c 
expire in December 1995, and 
the 30-month delay from th e 
patent suit filing should pro- 
tect the drug from competition 
until late 1996. 

Mr Leslie Dan, Novopharm 
chief executive, said yesterday 
if he bad secured a pattiai dis- 
missal of Glaxo's case, his case 
to have the 30-month period 
cut by the court would have 
been much stronger. Novo- 
pharm said that its generic ver- 
sion of Zantac would cost 
between 30 and 50 per emit less 
than Glaxo’s drug. 

Novopharm is also challeng- 


ing the validity of a second 
patent on Zantac, which 
expires in 2002. Mr Dan said 
challenges to both p atents wQl 
continue and that he remained 
“optimistic". 

• Separately, Novopharm has 
tab™ a step towards launching 
a generic version of Zantac 
based on the later patent That 
step is a type of approval from 
the US Food and Drug Admin- 
istration called a conditional 
Abbreviated New Drug Appli- 
cation. 

Early launch would only be 
possible if Novopharm secured 
a reversal of last year’s lower 
court decision upholding Zan- 
tac’s 2002 patent The case is 
with the US court of appeals. 


Commercial union 


NINE MONTHS' RESULTS 



Profits increase to £305m 


★ Operating profit before taxation increased by £165m to £305m, 
with a further strong performance in the United Kingdom. 

★ Life profits increased by 8% to £94m. 

★ General insurance trading conditions remain favourable in 
major markets. 

★ The acquisition of Groupe Victoire in France took place during 
October. Results will be consolidated in the fourth quarter. 


Total premium income 
Operating profit before taxation 
Operating profit after taxation 
Profit attributable to shareholders (note) 
Operating profit per share 
Shareholders' funds 


9 months 
1994 
Unaudited 

£4303m 
£3 05m 
£234m 
£283m 
39.7p 

£2/11 gin 


9 months 
1993 
Unaudited 

£4 / 488m 

£140m 

£124m 

£236m 

20.7p 

£2,314m 


Note The profit attributable to shandtoldeni includes realised investment gains after taxation of£49m (1993 £112m). 


Barrs shrug 
off board’s 
franchise 
warnings 

By Richard Wolffs 

The board of Ban- & Wallace 
Arnold Trust, whose voting 
shareholders are split by a 
family feud, yesterday warned 
that the motor side of the 
group could lose its distribu- 
tion franchises. 

The board said that two car 
manufacturers bad threatened 
to terminate franchises if rebel 
shareholders vote down its 
proposals to enfranchise the 
non-voting A shares. These 
shares, owned almost entirely 
by institutions, yesterday fell 
2lp to 263p, while the ordi- 
nary voting shares closed I5p 
down at 540p. 

The motor distribution divi- 
sion is expected to account for 
70 per cent of the leisure and 
motor group’s profits this 
year. 

The family fend broke out 
last month when Nicholas and 

Barr & WaHace Arnold 

Share price (penes) 

610 j. 

600 -I- 


Mercury faces cost cuts 
as profits fall by £3m 

. - n.. &.n * ■ 


By Paul Taylor 

The substantial restructuring 
programme at Mercury Com- 
munications announced yester- 
day by Cable & Wireless is part 
of a package of measures 

designed to prepare the UK 
telecommunications company 
for rnr-rp^o ri market competi- 
tion in th«» second half of the 
1990s. 

Although Lord Young of 
Graffham. Cable & Wireless 
chairman, declined to elabo- 
rate on the scale of the job cats 
at Merc ury , the unions believe 
that op to 10 per cent of Mercu- 
ry's 11,400 jobs could go. 

City analysts believe that the 
job reductions needed to repo- 
sition the company conld be 
even hig her. Yesterday some 
were pencilling in charges of 
up to £50m to cover the cost of 
reorganisation and s ugge sting 
that the result could be 
savings of about £40m. 

The need for cost reductions 
of this scale was hi g hli g hted 
by a £3m fell in Mercury’s first 
half operating profits to £96m. 


revealed In CAW’S interim 

results yesterday - although 
tiie group insisted the pro- 
gramme had been under on- 
cirtAHirtnn for several months. 

The profit decline at Mer- 
cury. which largely reflects 
competitive and regulatory fac- 
tors, was a surprise to analysts 
and overshadowed the II per 
cent rise in C&W’s pre-tax 
p r ofi t- 

Solid growth in call volumes 
and a 50 per cent increase in 
customer lines was not 
matched by profit Improve- 
ment, which Lord Young and 
other senior executives said 
was mainly because it had 
been hit harder than expected 
by regulatory changes. 

hi particular Mr James Ross, 
C&W’s chief executive, said the 
company estimated that the 
net effect of regulatory mea- 
sures - including a double 
price cut imposed an British 
Tplw-nfmmnni rat ions by Oftel, 

the regulatory authority, and 
substantially higher Access 
Deficit Charges - will reduce 
Mercury's profits by in 


the ton year, compared with 

between £25m and/£8Qm in a 
more normal year. . . 

Mr Mike Bhois, the ibnaer 
Mercury chlefexecutivewho 
has been moved as part of a 
senior management reshuffle 
to head a C&W group deweiop^ 
meat division, said a review 
under way by Oftel is expected 
to alter the system at ADG$ 
which rival operators pay to 
BT. 

- Lord Young emphasised that 
Mercury was being reposf- 
tkmed to face the growing com- 
petition in tike UK telecomnm- 
nications market L 

As part of this process Mr 
Duncan Lewis, who was; in 
charge of C&W’s US qperafiosu 
and director of the group’s 
business networks, has taken 
over as l&tocury’s c hi e f execu- 
tive. He will announce details 
of tire cost cuts and job redac- 
tions at Mercury within the 
next month- At the name time 
Mercury’s structure Is being 
r eorg an i se d into services and 
networks divisions. 

See Lex. 


Yates Wine Lodges up 51% 
and sees sales expansion 




I: 

530 1 « * * 1 * 1 

May 1894 Nov 

Stuck FT Graphite 

Robert Barr asked their uncle, 
Mr Malcolm Barr, to step 
down as chairman of the 
group. The brothers, who 
claim majority support among 
voting shareholders, have also 
requisitioned an EGM to 
unseat Mr John Parker, chief 
executive, and Mr Brian 
Small, finance director. 

They say they can unlock 
shareholder value by splitting 
the group’s two divisions into 
stand-alone businesses. 

However, the board has 
called another EGM to vote on 
enfranchisement on November 
25, one week before the rebds’ 
EGM. Enfranchisement would 
reduce family control from 
about 55 to 18 per cent 
The board seems likely to 
lose both EGM votes after Mr 
' Kerry Firth, a Barnsley-based 
businessman with 16 per emit 
I of the ordinary shares, re- 
affirmed his supp o it for the 
rebels yesterday. 

Mr Firth, who was asked by 
the board to referee a meeting 
with the Barr brothers this 
week, said: “Whatever support 
the board may have had from 
me in the past they will not 
get hi the future. 

“The company has underper- 
formed under the present 
chairman. That is why there is 
discomfort among sharehold- 
ers and why they are giving 
their votes to the brothers." 

Attempts to hold a meeting 
between Malcolm Barr and Us 
nephews broke down on Tues- 
day in a row over correspon- 
dence from the car manufac- 
turers. 

Nicholas Barr yesterday con- 
demned the warnings over the 
distribution franchises. “This 
is a blatant attempt by the 
board to safeguard its own 
position at the expense of 
shareholders," he said. 


By David Blackwell 

Yates Brothers Wine Lodges, 
the independent drinks group 
Which gained a foil listing jn 
July, yesterday announced 
interim profits ahead by more 
than 50 percent 

Pre-tax profits for the 26 
weeks to September 25 
increased from £ 1.41m to 
£2. 13m. Total sales rose to 
E24JSm from £22m last time, 
when riifirnnHmieri operations 
contributed £425,000. 

Mr Peter Dickson, managing 
director and great-grandson of 
Mr Peter Yates, the founder, 
said that since the end of the 
first half, like-for-like sales 
were almost 9 per cent ahead 


compared with a flat trend In 
the industry generally. “We 
believe we are pulling away ” 
lie added. 

The shares, placed at 140p, 
rose 6p yesterday to 181p- 

Operating profits at the core 
Yates’s Wine Lodges, which 
now comprise 36 outlets, rose 
30 per cent to £2iUm on sales 
up 24 pear cent at £X6J5m. The 
group, which also has 15 other 
outlets, is opening three fur- 
ther Wine Lodges next month. 

Sales in the wholesale side 
declined by 5 per cent to 
£5£8m as the group carried out 
its strategy of switching from 
secondary to direct wholesale. 
Operating profits were ahead 
from £82,000 to £90.000. 


The group has set itself a 
target of a 6 per cent Tetum on 
the wholesale business and 
Universal Wines and Spirits, 
which supplies drinks in fight- 
wet^ packaging to the airline 
industry. In August, Yates 
issued 16,760 shares to acquire 
the 25 pec cent of Universal 
that it did not already own. 
The division made profits of 
just £2,009 on sales of £2J6m. 

Net borrowings fell from 
27.68m to £499,000 following the 
£l0m placing. The group 
expects its continuing expan- 
sion to lift borrowings to £3m 
by the year end. 

Earnings were 42p (3p). The 
i nhi r im dividend is Ip — in Tine 
with the flotation forecast 


Placing expected to value 
Hydro at more than £10m 


By Peter Pearse 

Hydro International is coming 
to the market via a placing 
that win value thp company, 
which makpc control system s 
for storm water control and 
sewage separation, at between 
£lQm and eh sm. 

The company, based in C fe- 
vedon, Avan, utilises “vo r tex 
technology”, the principles of 
which have been known since 
Roman times. The vortex, or 
whirlpool, effect is harnessed 
to regulate fluid flow. 


The ram p arty has two main 
product ranges: fl ow c ontrol 
valves for flood protection and 
storm control and hydro- 
dynamic separators for separ- 
ating solids from liquids, espe- 
cially in the treatment of sew- 
age and other waste water. AH 
are patented and low-cost 
Hydro expects recent envi- 
ronmental legislation in 
Europe and the US, which has 
specified big cots in pollutant 
discharge, to increase capital 
works in its markets. 

The company is raising 


about 23.7m, of which £570,000 
will go to existing sharehold- 
ers. The balance is for research 
and development, international 
expansion and the develop- 
ment of new mar frgfrf 

The di re ctors are retaining 
between 60 and 65 per cant, of 
the equity. 

Hie board is forecasting pre- 
tax profits of £480,000 for the 
year to December 3L In 1993 It 
made £156^)00 an turnover of 
£4-lm. and in the six Tnonths to 
June 30, profits were £154,000 
on turnover of £2.4m_ 


Positive reception for two trusts 


By Befhan Hutton 

Two investment trusts raising 
capital to invest in emerg ing 
markets have had a positive 
reception from Institutional 
investors. 

Murray Johnstone’s new 
Murray Emerging Economies 
Trust has raised more than 
£45m during its placing stage. 


A public offer for another 
I9.4m shares at loop (with war- 
rants attached on a l-for-5 
basis) opened yesterday and 
closes an November 29. 

Foreign & Colonial 
announced yesterday that 
applications in the institu- 
tional placing of C shares in its 
Emerging Markets trust would 
he scaled hack. 


Applications were received 
for nearly £l00m-worth of 
shares, but the placing was 
capped at £85m_ App licatio ns 
will be scaled back pro-rata. 

A further 30m C shares at 
lOOp are available through a 
public offer closing on Novem- 
ber 14. Existing ordinary 
shares in the trust are trading 
at a 7 per cent premium. 


W oCi 




months to end September. McMahan Turner, the 

Turnover was slightly ahead at £133m five, for loss of office. 
(£13. Sm). Profits before tax ar 


Profits before tax and interest slipped in unchanged at L75p. 


Ea r nings per share were down from 7 Jp 
to 3.2p, with the interim dividend 


Stand still 


Cranfield 

f UNIVERSITY 
School of Management 


and you're going 
backwards 


Commercial Union pic, St. Helen's, 1 Undershaft, London EC3P 3DQ 


What works today may not work 
tomorrow. Only by looking beyond the 
principles and practices that have 
already made you successful can you 
anticipate and meet the challenges of 
the future. At Cranfield we will 
challenge you to challenge your 
organisation. 

Our General Management 
Programmes are designed to help you 
acquire the broad perspective, skills 
and personal confidence to influence 
your own future performance and 
contribute to your organisation's 
change. 



• The Cranfield Development 
Programme 

• Senior Managers Programme 
•General Management for Specialists 
•Foundation Management Programme 

To discover how our programmes can 
enhance your Individual and 
organisational development, ask for 
your copy of our brochure quoting 
Ref; GFT/2. 8 

Contact Judy Stamper on 
+44 (0)1234 751122 
or fax +44 (0)1234 750835. 


■m rc!i ;n> 


with - ! -** 


Ingham falls to £853,000 after provision 49 

Ingirem, the York-based motor parts, The result included the provision for an both the motor group and the nrouertv > 

worsted sninnimr and nmtvrtu umnn avaoviHaiiqI _ «... . auu iuc pj ujjci ij r 


reported a 42 percent fen in prefix* SnST Thfe^“r^t of a 

its, from £L47mto £853,000, for the six compensation payable to Mr Nicholas sSdy rtsekTtrool prkS 7 ' *** * 
to end s ^ber. ^ McMahon Tureer^the former chief execu- EaifoSSr'Z^S , 1n 


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FEMAiNCIAL TIMES 


THURSDAY NOVEMBER 10 11*94 


COMPANY NEWS: UK 




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wo trusts 




Electrocomponents 

improves 14% to £35m 


By Paid Tayior 

Electrocomponents. the 
electronic, electrical and 
mechanic?} components distri- 
bution group, yesterday 
announced a 14 per cent 
increase in interim pre-tax 
profits, from £31. lm to £35-5m. 

Mr Roy CotteriU, chairman 
said: “Our increased market 
presence coupled with the new 
marketing programmes and 
other initiatives introduced 
during the last 12 months con- 
tinue to generate strong 
growth in both sales and prof- 
its.” 

Turnover from continuing 
operations grew by 18 per cent 
to £216.6m (fiSS.lm) in the six 
months to September 30; oper- 
ating profits Increased by 15 
per cent to £34 .3m (£29.7m). 

Earnings per share rose by 
14 per cent to HJ2p C9.8p) and, 
as part of a rebalancing pro- 
cess, the interim dividend is 
lifted to 3.25p (Z5p). 

Turnover in the UK-based RS 
Components business rose by 
13 per cent reflecting continu- 
ing sales initiatives and 
increased market share. As 
expected, RS's UK margins 
were slightly lower due to 
higher selling and marketing 
costs. 

New products, particularly 
mechanical products which are 


Electrocompnnents 

Share prica rebbva tafin 
FT-S&a AH-Share index 

125 — - 



1893 1984 

Source: FT GraphKe 

now Featured in a dedicated 
catalogue for the mechanical 
engineer, were one reason for 
the sales growth. Mr Robert 
Lawson, chief executive, said 
tbe introduction of a CD-Rom 
catalogue in July had exceeded 
expectations, with more than 
35,000 disks being issued to 
customers. 

RS International sales 
increased by 42 per cent, 
helped by the group's greater 
penetration of overseas mar- 
kets, particularly those in con- 
tinental Europe. 

Radiospares Components in 
France continued to show 
strong growth, while a signifi- 
cant advance was achieved in 
Germany. The Italian 


Ugland returns to the 
black with £1.28m 


By James Whittington 

Shares in Ugland International 
yesterday rose 5p to ISSpasthe 
ship owner, manager and dry 
dock operate swung into the 
black with interim pre-tax prof- 
its of £L2fen, against a £780,000 


A new management team 
has been in place since last 
October at the company, for- 
merly known as Bristol Chan- 
nel Ship Repairers. The Ugland 
family holds a 30 per cent 
stake. 

Trading in the shares 
resumed last November at lOSp 
following a three-month sus- 
pension during which the com- 
pany was reorganised. 

In the six months to Septen> 
her 30, turnover jumped to 
£13.4m (£4m) following an 
improved performance from 
the shipping interests and the 
April acquisition of Gerrards 


Rederi in Norway. Earnings 
per share were 4.13p (6.96p 
losses) and a dividend of 1.65p 
(nil) is declared. 

Mr Andreas Ugland, execu- 
tive chairman, Ryirf last year's 
£19m rights issue and tbe addi- 
tion of eight ships from the 
Gerrards acquisition - which 
brought the total to 18 - had 
given the company a good base 
to increase profits. Gerrards 
contributed £868,000 to the pre- 
tax figure. 

Swansea Dry Docks, tbe ship 
repair business, fell to a 
£340.000 loss, on sales of 
£L36m, owing to stiff competi- 
tion. However, a second dry 
dock was opened in July and 
bookings bad -picked op- after 
an intensive marketing cam- 
paign, Mr Ugland Edited. 

Net borrowings stood at 
£10.2331 at the end of Septem- 
ber, giving gearing erf 45 per 
cent 


DIVIDENDS ANNOUNCED 


Current Date of ponding tor last 

payment payment dividend year year 

Amershara bit! .. —fr it 4-9f Jan 3 4.4 - 1&5 

Bfeby (J) — Jin 2 Feb 2 nfl 3 2 

CaMe&Wketess Int 2J3 Feb 28 . Z6 - 8^5 

Cham’tih &HH Int 2^5 Dec 21 2 - &S 

B a o Wo oo mpe — — W 3_25 - Jan 3 2J> - 0-5 

Fenner *1 1* Jan 18 nl 1-5 njf 

Hambro Insurance — Int 1-85 Dec 19 1-85 - 5-55 

Scottish Value 1 Jan 10 0-95 2 1.8 

Ugland Ml Int 1-65 Feb 24 - - 0.74 

Yatea Wine Lodge — Int 1 Feb 20 - 

Dividends shown pence per share net except where otherwise stated. tOn 
Increased capttaL ^Payable as foreign Income tSvIdend. 


The address is Manchester. 



The business is worldwide ■ 
and expanding! 

vna BRITISH VITA PLC, , 

Middleton, Manchester, M24 2DB. 

: Tel: 061-643 1133 Tax: 061-6535411 

INTERhtATIONAL LEADERS IN POLYMER, 

fibre and fabric materials and 

TECHNOLOGY ... SERVING THE FURNISHING. 
transportation, apparel, packaging 
■ and engineering industries. 


operations were trading ahi.-ad 
of budget and expected to 
achieve profitability as 
planned within 12 months. 

Meanwhile, Pact Interna- 
tional increased its sales by 7 
per cent and incurred a 
reduced loss in the seasonally 
weaker first half. 

The group ended the period 
with net cash of £65.5m (£57. 4m 
at end-March), 

• COMMENT 

Electrocomponents continues 
to produce the sound results 
expected of it. Net margins will 
remain under pressure in the 
second half as marketing costs 
continue to increase - but the 
group has proved itself adept 
at spotting and exploiting new 
domestic market opportunities 
ahead of the competition. Hav- 
ing developed and proved new 
concepts, such as the CD-Rom 
catalogue and trade counters 
in the UK. the group's strategy 
is to take them overseas and 
grow the International busi- 
ness. Pre-tax profits should 
reach about £83m this year, 
producing earnings of just over 
26p. The shares, which gained 
lp yesterday to 472p. are still 
trading well below their 12- 
month peak of 585p, reached in 
January. It deserves the pre- 
mium rating represented by a 
prospective p/e of 18 . 


Decline at 

Hambro 

Insurance 

By Richard Wotffe 

Hambro Insurance Services 
Group yesterday blamed low 
levels of insurance claims for 
tbe continued poor perfor- 
mance of its loss adjusting 
subsidiary and a decline in 
group profits. 

Mr Nicholas Page, managing 
director, said: “The volume of 
claims has declined and I am 
hoping that it has bottomed 
out. Pressure on volumes 
translates into pressure on 
fees, particularly in the UK." 

The shares closed down 9p 
at 105p yesterday, 24 per cent 
lower than the placing price of 
I38p when the group was 
floated in June last year. 

It reported pre-tax profits of 
£3.05m (£3. 25m) on turnover 
up 20 per cent to £40.2m 
(£33. 4m) in tbe six months to 
September 30. 

Cunningham, the loss 
adjusting division, reported 
pre-tax losses of £432,000 
(£372,000 profits). 

Earnings per share fell to 
2.94p (3.05P) but the interim 
dividend is again 1.85p. 

• The company yesterday 
announced a joint venture 
with Morden & Helwig of the 
US to create a worldwide 
loss adjusting and claims 
management network, called 
Cunningham Lindsey Interna- 
tionaL 


A new perspective on rankings 

Nicholas Denton looks at a revamped league table of M&A advisers 

Q uarterly league tables to Deutsche Bank, has been — — 1IV „ 1BI .« 

of mergers and acquisi- adviser to one side or the other FINANCIAL ADVISERS UKPUBUC TAKEOVERS 
tions arouse as much in more bids than any Other JANUARY 1985 - SEPTEMBER (994 

smm as natinn nn 99R to Wartuiw’K 108. “T think tu nf kin n< total 


Q uarterly league tables 
of mergers and acquisi- 
tions arouse as much 
scorn as fascination on 
the part of the financial advis- 
ers they measure. 

Investment banks - espe- 
cially those disappointed with 
their standing - complain that 
all they provide is a snapshot, 
and a blurred one at that A 
single deal can upturn the 
rankings and tbe criteria 
including a transaction can be 

arbitrary. 

Next week however Acquisi- 
tions Monthly, the leading 
compiler of M&A data in the 
UK, will publish a league table 
less vulnerable to dispute. Cov- 
ering public takeovers, both 
completed and Tailed, the 
report goes back nearly 10 
years to the magazine’s foun- 
dation in 1585. 

SG Warburg beads the list, 
putting recent losses on trad- 
ing and disappointing interim 
results into perspective. Hoy- 
lake's abortive £13bn bid Tor 
BAT Industries in 1969 was the 
largest of £65.5bn of bids in 
which Warburg was involved. 

Morgan Grenfell and Schro- 
ders emerge as the other pre- 
eminent takeover advisers of 
the decade. Morgan Grenfell 
has had its downs: the Guin- 
ness affair damaged the firm’s 
reputation, and this year has 
been quiet. But the bouse, 
owned by and growing closer 


to Deutsche Bank, has been 
adviser to one side or the other 
in more bids than any other 
226 to Warburg’s 1S8. “I think 
it absolutely demonstrates that 
we dealt with the Guinness sit- 
uation and put it behind us," 
said Mr Guy Dawson, a direc- 
tor of Morgan Grenfell. 

Goldman Sachs comes in as 
the highest placed US invest- 
ment bank. UK competitors 
caution that Goldman achieved 
its position by taking mainly 
subsidiary roles in a few large 
deals. But the US house's spe- 
ciality of bid defence has paid 
off. Rivals admit Goldman has 
made inroads and the firm is 
increasingly acting as lead 
adviser. 

Calculating the volume of 
deals is controversial enough, 
but Acquisitions Monthly has 
ventured into even more dan- 
gerous territory by producing 
figures on financial advisers' 
success rate in hostile bids. 

Few conclusions can be 
drawn, however, from what 
remain small samples. Never- 
theless traditional reputations, 
Warburg’s for defence and 
Morgan Grenfell's for attack, 
are borne out Schroders and 
Goldman Sachs also stand out 
as effective defenders of hostile 
bid targets, with Schroders 
helping to fend off challenges 
in 59 per cent of the cases in 
which it was involved. 

Morgan Grenfell and NM 


SG Warburg £T) 97 101 198 85.4 51 

Morgan Grenfell (1) 122 104 226 55,903 

Schroders (4) 104 81 185 51,385 

Goldman Sacha (-) 12 20 32 43,904 

Lazard Brothers (14) 75 53 128 39.163 

Kfeinwoil Benson (3) 74 111 185 37,424 

NM Rothschild (6) 69 59 128 26,918 

Hamfaroa Bar* (10) 02 41 103 26,807 

Lehman Brothers {-) 6 12 20 23*277 

Samuel Montagu (11) 69 59 128 23,199 

* 1985 reritng. THa onto h based on cornpAKotf in CUfea LK pubic tmom Jnruvy iBflS-Sapam- 

bor 1994 and only uttudoo dam ocMttri adhp on 20 or men srsntactkra 

Same Acqutabena Monthly 


Rothschild offset apparently 
worse than average records in 
defence with the strongest per- 
formances of the top lo in 
advising aggressors. “We have 
a very high hit rate," said Mr 
Russell Edey, head of corporate 
finan ce at NM Rothschild. The 
pair’s clients managed to take 
over target companies more 
than half Of the time. 

L azard Brothers, by con- 
trast, is recorded as hav- 
ing won only two of 14 
hostile bids on which it 
advised the aggressor. “You 
have to be terribly careful 
about what constitutes suc- 
cess," warned Mr John Dear, 
head of corporate finance. “We 
are never afraid of advising a 
client that he should walk 


away rather than pay a silly 
price. The winner of a bid can 
turn out to be tbe loser in the 
long run.” 

That is just one of several 
flaws remarked upon in Acqui- 
sition Monthly's findings. One 
bid, that by Hoylake which 
failed, catapulted Warburg into 
first place. Most important per- 
haps, public takeover activity 
has declined since the 1980s 
and represents only a small 
part of investment banking. 
One banker damns the league 
table with faint praise: “It is an 
interesting historical record.” 

As long as compilers produce 
M&A league tables, investment 
bankers will gripe, no matter 
how broad the timespan. And 
they will continue to pore over 
them. 



Ty, gdvertiauneni is laiuad by TeleWen Communications pit and has bren apt.io.ed by Kteinwoii Benson Limited, a member ol The Securities and Futures Authority Limited, solely (or the purpose of Section 57 of the Financial Services Act 1986. 






28 




FINANCIAL TIMES THURSDAY NOVEMBER 10 «94 


CONTRACTS & TENDERS 


■ 



THE 


CROWN 

ESTATE 



INVITATION 

TO SUBMIT EXPRESSIONS OF INTEREST FOR THE 
POSITION OF TECHNICAL MANAGING AGENT FOR 
THE OFFSHORE MARINE ESTATE 
As part of thdr ruffing programme of tendering major consultancy 
ixHftacra the Crown Estate Commsaonerewfll Be tendwlnu the position 
of Technics! Managing Agent tor the Offshore Marina Estate currently 
held by Fostocd DuvMer. 

The Crown Estate Conwntes to nare Invite 'Expressions of Interest" from 
those Interested In participating in this Tender. The Conan ts s to nera wS 
decide on tin basis of titis In for mat ion to whom to release Tender 
documents. The Tender wH seek bids for a three year contract. 

The offshore Marine Estate la primeriy con c erned wBh Marine Aggregate 
Extraction and the role of Technicai Agent Includes Geological Analysis, 
and the fid management of an ARC Into GtS and an associated 
Bectronta M o nitoring System far aff dkedglng vessefo op e rettng on Crown 
Estate licences. 

The forms of Expressions of Interest including further inf or mati on may be 
obtained from Dr A J Murray, Hie Crown Estate, 16 Cariton House 
Tbrrace, London, SW1Y 5AH (telephone: 071 210 4314). Please quote 
reference. 

Expressions of Interest must be received by Monday 28 th November. 


LEGAL NOTICES 


This Notice is a Matter of record only-Novsmbar 10. 1994 

Curtis A. Phaneuf has filed In Federal District 


Court District of Arizona, No. CIV-94-746 TVC 
WDB, for more than US$25,000,000, due to 
nonpayment of promissory notes due and 
payable 15 May 1993, extended to 15 May 1994, 
issued by the Republic of Indonesia through 
Oewan Pertahanan Keamanan Nasional, AKA 
The National Defense Security Council— 
Jakarta, Indonesia. 

Notes signed by: Dr. Ibnu Hartomo. Deputy of 
Development, Mr. S. Soebattyo Soedewo. 


Deputy for Long Term Planning and Mr. H.A 
Chalid Mawardi. Ambassador Extraordinary 
and Plenipotentiary of the Republic of 
Indonesia. 

Notes authorized by: Lt. General Achmad 


Wiranatakusumah. Secretary General. 


COMPANY NEWS: UK 


Carlisle funds property expansion 


By Simon Dairies 

Carlisle Group yesterday completed its 
f Tftrtsfa rmation from a financial services 

company to a property group with the 
announcement of a £14 .4m placing and 
open offer to help fund £29m of property 
purchases. 

The transaction will almost double the 
size of Carlisle, whose primary operating 
business Is the Pepper Angiiss & Yarwood 
property agency. 

Mr Nigel Wray, chairman and largest 
shareholder, said: “The deal gives ns the 
balance sheet that will enab le ns to take 


the next step. We'd like to trade out a lot 
of this portfolio and get more heavily 
involved in the Mayfair area." 

The company j S offering 75.6m new 
shares at 20Y«p on a 10-for-ll basis. 

Carlisle will pay £4.5m for Strath Inver, 
the Investment holding company which 
owns the portfolio. It has agreed to repay 
£4.3m of Strathinver’s £2*L5m debt imme- 
diately, and will repay a further £6. 95m 
by the end of the year. 

Strathinver is 60 per cent owned by 
Coats Vlyella. The family of Mr Jonathan 
Harris, Carlisle’s chief executive, bolds 26 
per cent. It reported pre-tax losses of 


£470,000 for the year to March 31 on turn- 
over of £2-69m. 

The company owns 16 commercial and 
industrial properties spread throughout 
England, with current net rental income 
of £2.68m. This represents a yield of more 
than 9 per cent The deal, effectively a 
reverse takeover, provides Carlisle with 
the financial muscle to develop as a prop- 
erty investment group. Net assets will 
increase from £9 .24m to £24m. 

Trading in the shares was suspended 
and win not resume until December 8, 
when dealings in the new shares are dne 
to commence. 


Former tipster makes his mark 

Carlisle’s reconstruction comes as no surprise, says Simon Davies 


A Prime Site for your 
Commercial Property A d vjebtisjln g 

Advertise your property to approximately 
1 million FT readers in 160 countries. 
For details: 

Call Emma Mnllaly on 
+ 44 71 873 3574 
or Fax: +44 71 873 3098 


T he transformation of 
Carlisle from a small 
finan cial services com- 
pany Into an ambitious prop- 
erty investment company has 
caused little surprise, as it car- 
ried the classic hallmark of its 
main shareholder, entrepre- 
neur Mr Nigel Wray. 

The former tipster, who 
bought the Fleet Street Letter 
for £7.500 and transformed it 
into the multi-million pound 
concern that eventually 
became Carlton Communica- 
tions, has bad enormous suc- 
cess reconstructing shell com- 
panies. 

In 1988, his newsletter group 
Charts earch launched a suc- 
cessful bid for Burford, a fledg- 
ling USM-traded property 
group. 

It has since been trans- 
formed into a £270m-capitalised 
group which owns the Troca- 
dero and a £100m prime portfo- 
lio acquired from Ladbroke in 
February. 

Mr Wray is hoping to da the 
same with Carlisle, a company 
he has known since the mid- 
1980s, when he acquired a large 
holding in its former incarna- 


tion. Somportex. Its primary 
business at the time was Slush 
Puppy. He sold the bulk of his 
shares in 1987. but repurchased 
33 per cent of Carlisle in Janu- 
ary at a substantially lower 
price. 

Mr Wray’s love of small com- 
panies dates from his days as a 
trainee fund manager with 
Singer & Friedlander. 

After his success with Fleet 
Street Letter in the early 1980$. 
he launched a spate of take- 
overs, including a bid for 
Singer 10 years after he left it 
as a trainee. 

He has managed to keep on 
good terms with his invest- 
ments. and retains director- 
ships and small shareholdings 
in both Singer and Carlton. 

His other main investment is 
a 13.5 per cent stake in The 
People's Phone, the indepen- 
dent cellular phone service 
provider, which now has 
180,000 subscribers and should 
make profits of Efim this year. 

Mr Wray sees himself as an 
investor in people. He has 
focused on basic businesses 
and backs managements in 
which he feels confident. 


“My job is to make sure that 
I have got the right chief exec- 
utive, that he's doing his job 
well, and that he’s got the opti- 
mum conditions in which to 
work,” he said. 

Property is a business he 
likes. At Burford he found a 
company run by ambitious 
chief executive and fellow Mill 
Hill old boy Mr Nick Leslau. 

His aim was to establish a 
conservatively financed group 
that could focus on investing 
in problem properties, produc- 
ing a reasonable rental scream 
but requiring intensive man- 
agement. 

In the case of Carlisle, he is 
backing Mr Jonathan Harris, 
who worked his way up from 
office boy to senior partner at 
property agency Pepper 
Angiiss & Yarwood. Carlisle's 
only operating business. 

Mr Harris, Carlisle's chief 
executive, has spent the last 
four years trying to reverse the 
actions of a previous manage- 
ment which took the group 
into stockbroking and Welsh 
gold mining, with disastrous 
results. He is finally in a posi- 
tion to move forward. 


"Carlisle's strategy is to 
acquire properties whose value 
can be enhanced by intensive 
manag ement", said Mr Wray, 
echoing the old policy of 
Burford. 

He is keen that Carlisle 
should build up investment in 
Mayfair, funding purchases 
through trading out existing 
properties and, if the market 
will support it. new equity. 

Carlisle's t imin g has not 
been immaculate. An earlier 
deal, involving the purchase of 
some small, properties from 
Burford. was blocked by the 
Stock Exchange because the 
holding company did not have 
a three-year track record. 

Carlisle's share price at the 
time was about 30p. compared 
with Tuesday's clo^ng price of 
22%p. However, Mr Wray him- 
self has fared better, having 
bought in at up. Following the 
placement, his shareholding 
will be diluted to 17.7 per cent, 

but he Tnaintam«i tha t he IS 

there for the long term. “I like 
the stock market, but when I 
look back, it is only the invest- 
ments that I’ve had for five or 
10 years that count,” he said. 


Receiver sells rump of RFS Industries 


By Simon Davies 

Price Waterhouse, receiver to RFS 
Industries, the former British Rail-owned 
engineering company, has sold the last of 
its businesses to a management buy-out, 
saving 350 jobs at the Doncaster-based 
company. 

RFS was a £5m management buy-out 


from BR in 1987, and was the first privati- 
sation of its rolling Stock manufac turing 
operations. 

However, the company used its revital- 
ised finances to expand into new busi- 
nesses, and having drastically over- 
extended itself, went into receivership in 
December 1993. 

The company's core rail passenger 


rolling stock and bogie design operations 
were sold in May to Bombardier Eurorail 
for an undisclosed sum. This represented 
about 80 per cent of group turnover. 

The r emaining overhaul operations are 
being sold to the MBO. RFS employees will 
own 33 per cent of the company, with the 
remainder taken up by backers, including 
Yorkshire Fund Managers and Sun T.ifn. 


Rationalisation 
benefits Fenner 


By Andrew Ba*t© r 

Rationalisation, organic 
growth and new products 
helped Fenner, the power 
transmission, fluid power and 
industrial belting group, 
lift full year pre-tax profits 
from just £315,000 to 
£8. 15m. 

Operating profits before 
exceptional items for the year 

to August 31 rose 27 per cent to 

£12 .2m, the highest for four 
years, while turnover slipped 
from £2QL6m to £20O8in. After 
adjusting for disposals and 
exchange rate movements, 
turnover rose 5 per cent 

Exce ptional items foil from 
£6_3m to £2.6m as redundancy 
and rationalisation costs fell. 
Interest charges dropped from 
£3£m to £L9m, reflecting last 
September’s rights issue and 
placing. 

E a 7-ning s per share, after 
exceptional items, were 4L4Q) 
(6.97p losses). 

Mr Mark Abrahams, chief 
executive, said the biggest 
achievement was the turn- 
round on the power transmis- 
sion side - Fenner's largest 
business and one that was for- 
merly for sale. 

In spite of continuing diffi- 
cult trading conditions, the 
division reported its first oper- 
ating profit for three years. 

The “star performer,” said 
Mr Abrahams, was the poly- 
mer business, which was 
helped by a 20 per cent rise in 


US sales and strong gmwth 
in hose and ducting sales! . - - 
The fluid power division was 
helped by a strong; perfor- 
mance in the US, and bum inl- 


and the US of .Fensfer’a hew . 
vapour recovery system for 
use at petrol filling .stat- 
ions. ’ ! : ‘ . 

Mr Abrahams said the sys- 
tem, which returns sin^eaQy 
carcinogenic vapour back to 
the filing station tank, could 
become a “very material" part 
of the division. 

A final dividend of lp foil) 
will be paid aa a foreign 
income dividend, a: measure 
introduced at the interim stage 
to save on ACT. Hue total foe 
the year ls L5p (nil). 

• COMMENT 

After recession, things, ire 
c on nin g right at-last for Fen- 
ner, due as much to Us own 
efforts as to improved market 
conditions: The main:probtem, 
power transmission, las been 
sorted out and offers a solid, if 
un exciting , future. The rights 
issue and placing has cut gear- 
ing from 51 to 10 per cent and 
gives a better springboard from 
which to exploit new products 
- especially the’ vapour recov- 
ery system. Organic growth 
and a further reduction in 
exceptionals should give pre- 
tax profits of about £13m this 
fear. Assuming a lower tax 
charge, the prospective p/e is 
reasonable at 12 to 13. 





TmarNunpMH 

Colin Clarke, chairman, (left) and Mark Abrahams with Framer’s 
new vapour recovery pump for petrol fitting stations 


LEGAL NOTICES 


UNITED STATES BANKRUPTCY COURT 
SOUTHERN DISTRICT OF TEXAS 
HOUSTON DIVISION 


IN RE: 

GUYANA DEVELOPMENT 
CORPORATION 
Debtor. 


CASE NO. 93-41444-H5-I1 


(Chapter 11) 


NOTICE OF CHAPTER 11 CASE 
AND DEADLINE FOR FILING CLAIMS 

1. co m mencement of C h anter n gantoatoa Crab— and ftBPo lo tacat of True tea, on 
February 22, 1993, Guyana Development Corporation ("GDC") commenced a Chapter 
11 bankruptcy case under the United States Bankruptcy Code in the United 
States Bankruptcy Coart for the Southern District of Texas, Sons ton Division 
(■the Bankruptcy Court"). On December 15, 1993, the Bankruptcy Court appointed 
David Aakanase, a Houston attorney, as the Chapter 11 Trustee of GDC. Hr. 
Askanaae'a address is: David Aakanase, Trustee, Hughes, Hatters t Aakanase, 
L.L.P., 1415 ■ Louisiana, 37th Floor, Houston, Texas 77002; (713) 759-0818 
(telephone); (713) 759-6834 (facsimile). 

2. CQflaflftL. Counsel to the Trustee in the GDC Chapter 11 bankruptcy caBe in 
the law firm of Kirkendall, isgnx and Rothfelder, L.L.P., 700 Louisiana, 48th 
floor, Houston, Texas 77002; (713) 225-4646 (telephone); (713) 225-1284 
(facsimile). Correspondence to the Trustee's counsel should be addressed to 
the attention of David R. Jones. 

3. Property of the B atate ^. Under a series of Orders, the Bankruptcy Court has 
determined that the assets of Edward w. callan, Bdward Callan Interests, South 
West Property Holdings, Ltd., Allied Maritime, Znc. and Guyana Joint Ventnre 
Partnership are property of GDC's bankruptcy estate . GDC also owns, or owns an 
interest in. Sooth Cat Cay Company, Ltd.. Guayana Exploitation Ltd, Balkan 
Explores Ltd, Balkan Explores (Bulgaria) Ltd, Petxomineroa S.A., Petromineros 
Del Pern Ltd. Xarak Petroleum Pakistan Ltd., CaaamancQ Petroleum Ltd., 
Colossus Petroleum Ltd., Four Leaf Limited Partnership, Bdgewater Corporation, 
Miami Real Estate Ventures Inc. IV, Eldorado Ltd., north Africa Petroleum 
Limited and Ashby Park Investments. Xf yon are a creditor of any of theee 
entities, please read paragraph S aa your rights may be adversely affected if 
you do not file a proof of claim. 

4. HQtice^, GDC's known creditors will receive (i) a copy of GDC 'a disclosure 
statement and proposed plan of reorganisation; (ii) notice of the date of the 
confirmation hearing on GDC'e proposed plan; and, (iii) notice of any other 
matters required by the Bankruptcy Court or the Bankruptcy Code. Any GDC 
creditor or paxty-in-intereet in the GCD Chapter 11 bankruptcy case may 
receive notices of hearings and copies of any other documents filed with the 
Bankruptcy Court in GDC's Chapter 11 bankruptcy case by filing an appropriate 
notice with the Bankruptcy Court under Bankruptcy Rule 2002 and providing s 
copy of such notice to the Trustee and his counsel. 

5. Claims. The Bankruptcy court has established Tuesday, January 31, 1995 

(■the deadline") as the deadline for filing claims with the Bankruptcy Court 
in the GDC Chapter 11 bankruptcy ease. Proof of claim forms are available from 
tbe Clerk of the Bankruptcy Court. A claim may be filed by mailing (i) an 
original and a copy of your proof of cLaim along with a self-addressed 
envelope to U .8 . -Bankruptcy Court. P.O. Box 61288. Houston. Taras 77208. and 
(ii) a copy of your proof of claim to Trustee's counsel. If you are a creditor 
of GDC or any of the entitles listed in paragraph 3 and wish to pursae your 
claim, then you must file - on or before the deadline - a proof of claim with 
tbe Bankruptcy Court and dal Ivor a copy of such proof of claim to tbe 
Trustee's counsel. Zf yon do not, then your claim may be time-barred and you 
may not be entitled to a dividend, if any, from tbe liquidation of tha GDC 
estate. If a proof of claim is filed with the Bankruptcy Court through the 
mail, then such proof of claim must be received by the Clerk of the Bankruptcy 
Court on or before tbe deadline. If a proof of claim is received by the Clerk 
of the Bankruptcy Court after the deadline, then such claim may be time-barred 
and yon may not be entitled to a dividend, if any, from the liquidation of the 
GDC estate. 

This form of notice was approved on October 17, 1994 by the Bankruptcy Coart, 
the Honorable Karen X. Brown presiding. 

David Aakanase, Trustee 
Hughes, Hatters A Aakanase, L.l.p. 
1415 Louisiana, 37th Floor 
Houston, Texas 77002 
<713) 759-0818 (telephone) 

(713) 759-6834 (fncsimile) 


Kirkendall, Xsgur & Rothfelder, L.L.P. 
700 Louisiana, 48th Floor 
Houston, Texas 77002 
(713) 225-4646 (telephone) 

(713) 225-1284 (facsimile) 


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0121 423 3013 

Rowerline 


THE BUSINESS SECTION 


appears Every Tuesday A Satutby. 
Please contact 

Melanie Miles on +4471873 3308 or 
Karl Layman on +44 71-873 4780 
« write to them ii 
Tbe Ftnsadal Time*. 

One Southwark Bridge. 
London SE1 9HL 


| njw*OAi Tum | 


The Financial Times 


No FT, no comment, 


offers readers free copies of the annual 
report and accounts of over 900 listed 
companies, simply by telephoning one 
London number 

Companies participating in the service 
are indicated by a $ symbol next to their 
share price listing on the London Share 
Service pages. You can request the 
reports of any of 
these companies by 
phoning or faxing 
the numbers shown 
on these pages in 
the FT every day. 

Lines are open 
24 hours a day, 
seven days a week, 
and reports will be 
posted to you the 
next working day? 
free ef charge. - 



<0 

45 






29 


financial times 


THURSDAY NOVEMBER 10 1994 


A 


COMPANY NEWS: UK AND IRELAND 


■Deeper losses and delay in mine reopening programme hit share price 

Coal Investments £10m in red 


By Michael Smith 

Shares is Coal Investments 
the mining company, lost 
another 7 per cent of their 
value yesterday after the com- 
pany reported a 10-week delay 
in its mine reopening pro- 
gr amm e and interim pre-tax 
losses of E10.2IIL 

The shares fall continues a 
trend which began when Coal 
Investments and the Union or 
Democratic Mine workers failed 
to secure nomination as pre- 
ferred bidder for either of the 
central English coal regions. 

Yesterday's closing share 
price of 87p compares with a 
high, achieved early last 
month, of 143p. 

Losses for the Six m onths to 
September 30 compared with a 
deficit of £68,000 last time. 
Turnover was £940,000 (nil) and 
losses per share 20p (Q3p). 

Mr Malcolm Edwards, chair- 
man, said substantial progress 
bad been made in bringing 
the company’s five mines back 
into production and the most 
difficult part of the develop- 
ment had been completed. 


Pull production had been 
achieved at the small 
mine at Cwmgwili In Wales 
following earlier geological 
problems. 

Two of the Tour larger mines 
were now ready to start com- 
mercial production. 

Mr Edwards said that next 
year's production and sales 
from all mines would be 
greater than previously expec- 
ted, although he declined to 
say by how much. 

The company said produc- 
tion delays resulted from late 
delivery of machinery. 

The cumulative effect would 
be a lower than forecast level 
of production and sales during 
the second half and consequent 
net cash outflow during that 
period. 

The company had agreed 
terms in principle for addi- 
tional loan facilities of £5m to 
meet this requirement. 

It would refinance the 
loan as part of a further 
equity issue to be anno unced 
soon. 

Mr Edwards was confident 
about prospects for 1995-96 and 


Coal Investments 

Share price (pence} 

160 ; — 



Seven FT Graphite 

beyond. Excellent progress was 
being made in discussions with 
a number of coal buyers and 
directors were “confident that 
period sales contracts will be 
put in place for the greater 
part of the group's produc- 
tion". 

• COMMENT 

Mr Edwards' high-flying shares 
have been floating hack to 
earth recently, but investors 
who have been in from the 


Thorn EMI discusses sale 
of sensors business to Racal 


By Bernard Gray, 

Defence Correspondent 

Thorn EMI, the music and 
rentals company, is in discus- 
sions with Racal Electronics 
over the sale of its defence sen- 
sors businesses. 

No price has been disclosed, 
but the businesses, based at 
Crawley, West Sussex and 
Wells, Somerset, had turnover 
of about £75m last year. 

The division employs 1,140 
people. Its main products are 


specialised radars, such as the 
Cymbeline weapon-locating 
radar, electronic counter- 
measures equipment and com- 
mand and control systems for 
land forces. 

Thom is in detailed discus- 
sions with Thomson of France 
over the sale of its defence 
group business, which does not 
include the sensors operations. 
The defence group's turnover 
is about £80m and its main 
activities are fuses and electro- 
optics equipment 


Thom has also sold its elec- 
tronic security business. If 
both the defence and sensors 
sales are completed, it will 
only be left with its transac- 
tion ticketing operation out- 
side its declared core areas. 
Preliminary discussions on the 
ticketing business are also tak- 
ing place. 

Sir Colin Southgate, chair- 
man, has said that the com- 
pany will concentrate on its 
music production, music retail- 
ing and rental operations. 


start can still reflect on a more 
than fivefold increase in their 
holdings in the year since he 
took over. In spite of the bid- 
ding disappointments and the 
production delays announced 
yesterday, many investors are 
still prepared to put their faith 
in tbe former British Coal mar- 
keting director. Losses could 
reach £i4m this year but pro- 
viding the company can mine 
and ski 3m tonnes a year, as 
some brokers believe is possi- 
ble, it could make £i4m in prof- 
its in 1995-96 excluding any 
effects of its holding in Mining 
Scotland, the preferred bidder 
for British Coal's Scotland 
region. Profits of £14m would 
put tbe shares on a p/e of 
about 5, rather low according 
to supporters. All very well, 
but the company still has 
much to prove. It must get the 
next share issue out success- 
fully and it must show that it 
can meet its production and 
sales targets. Failure to show 
solid progress by the end of 
the year could meet with a 
stern response from the 
market. 


Scottish Value 
Trust net asset 
value rises 12% 

Scottish Value Trust increased 
net asset value per share by 12 
per cent, from 97.34p to 109.15p, 
during the year to September 
30. 

The rise compared with 
gains of 7 per cent and 0.3 per 
cent respectively in the FT- 
SE-A Investment Trust Index 
and the FT-5E-A AU -Share. 

After-tax revenue increased 
from £845,000 to £1.0Lm giving 
earnings per share of 2.05p 
(1.76p). 

As foreshadowed, the final 
dividend is Ip for a total of 2p 


Irish Life 
reorganises 
into two 
new units 

By John McManus in Dublin 

Irish Life has reorganised its 
UK and Irish operations into 
two new units. The retail busi- 
nesses in Ireland and the UK 
arc to be combined into one 
unit, while the Irish corporate 
business will be combined 
with the investment division 
into a second unit. 

Previously, the Irish retail 
and corporate businesses oper- 
ated as one unit while the UK 
retail business formed part of 
the European operations. 

Mr Brian Duncan, chief 
executive of Irish Life Ireland, 
is to step down at the end of 
the year following the reor- 
ganisation. 

Mr Duncan has worked for 
Irish Life since 1964. heading 
the Irish operation since 1985. 
He is now expected to take up 
a position in the Irish health 
insurance industry, being 
tipped to take over at VHL the 
state-owned health insurance 
company. 

The reorganisation is 
“designed to build upon the 
company's leadership position 
in our core retail and corpo- 
rate business markets in 
Ireland and to underpin our 
strategic repositioning in the 
UK market," explained Mr 
David Kingston, managing 
director. 


£200m Airtours bond 

Airtours, the tour operator, 
has signed a new five-year 
bonding facility worth £200m, 
which will replace existing 
facilities. 

It has been jointly arranged 
and underwritten by Barclays 
syndications, Nat West Capital 
Markets and Soctete Gdngrale. 


THE 

DAVID 

T HOMA S 

PRIZE 


David Thomas was a Financial Times journalist killed on assignment in 
Kuwait in April 1991. Before joining the FT he had worked for, among 
others, the Trades Union Congress. 

His life was characterised by original and radical thinking coupled 
with a search for new subjects and orthodoxies to challenge. 

In his memory a prize has been established to provide an annual study/ 
travel grant to enable the recipient to take a career break to explore a 
theme in the fields of industrial policy, third world development or the 
environment. 


The theme for the 1995 prize, worth not less than £3,000, is: 
DOES FREE TRADE THREATEN THE ENVIRONMENT? 


Applicants, aged under 35, of any nationality, should submit up to 1000 
words in English on this subject, together with a brief c.v. and a proposal 
outlining how the award would be used to explore this theme further. 

The award winner will be required to write a 1500 to 2000 word 
essay at the end of the study period. The essay will be considered for 
publication in the FT. 


CLOSING DATE JANUARY 6 1995 


Applications to: 

Robin Pauley, Managing Editor 
The Financial Times (L) 
Number One Southwark Bridge 
London SE1 9HL 


Villiers 
cats loss 
to £I.54m 

Vmiers Group, tbe USM- traded 
specialist engineering com- 
pany, reported pre-tax losses 
reduced from £2J8m to £L54m 
for the year to July 3L Turn- 
over was 45 per cent ahead at 
£2. 72m, compared with a. 
restated £L87m. 

Acquisitions contributed 
£L2lm to sales. Operating prof- 
its totalled £11,000 (£338,000 
loss). 

The company, which is US- 
based, said its continuing 
operations had been profitable 
since January. Following the 
disposal in June of its Starks 
Ffcld oil operations for $L5m 
(ci jam) , its operating accounts 
consisted entirely of engineer- 
ing business. The second half 
had made a positive overall 
contribution, reducing the 
£1.86m loss reported at interim 
stage. 

Losses per share improved 
from an adjusted 5.4%) to 1.49p. 

Chamberlin & Hill 

Interim pre-tax profits foil 19 
per cent at Chamberlin & H il l, 
the maker of iron castings, 
electrical conduit fittings and 
switchgear. 

The figure for the six months 
to September 30 was £640,000, 
compared, with £747,000, struck 
on turnover of £11 .6m, up 11 
per cent from £10.4m. 

Mr John Eccles, chairman, 
said traditionally the second 


NEWS DIGEST 


half had proved stronger than 
the first, and this year should 
be no exception. 

Earnings per share came out 
at 5.94p (7-35p), with an interim 
dividend of 2L25p (2p). 

Scottish Power 

Scottish Power has agreed con- 
tracts to buy the entire gas 
output of the Magnus Field In 
the North Sea for £150m. 

Gas wDl be supplied far at 
least 10 years from October 
next year, and Scottish Power 
will initially bring ashore 
about 60m cu ft a day from the 
field. 

Magnus is operated by BP 
Exploration in partnership 
with Repsol, Brasoil UK, 
Sunofl Britain and Goal Petro- 
leum. 

Scottish Power is building a 
portfolio of gas supplies for its 
Caledonian Gas marketing arm 
and its Longannet power sta- 
tion. 

Bund expands 

Bunzl, the distribution and cig- 
arette filters group, has made 
its eighth acquisition in just 
over two years with the pur- 
chase of NL Whittaker. 

The company, which incor- 
porates the business of AW 
Holmes (Paper), supplies a 
range of disposable items, 
mainly to the hotel and cater- 
ing trades. 

Sales of the combined busi- 
nesses in the year to December 
31 1993 totalled £l3m; net 
assets are estimated to amount 
to £2Am. 

Mr Anthony Habgood, Bunzl 
chief executive, said the deal 


demonstrated the group's con- 
tinuing commitment to the 
development of paper and plas- 
tic disposables activities, now 
its largest and most profitable 
business. 

Seet 

Shares of Seet dropped 7p to 
44p yesterday after the textiles 
group reported sharply 
increased annual losses. 

The group also announced 
that Homemaker Shops, its 47.7 
per cent -owned lossmaking 
associate, had sold its trading 
assets to Florida-based linen 
Supermarket: the directors 
estimate that Seet will receive 
between $L71m and $1.96m 
(£1.19m) but under Stock 
Exchange rules will have to 
seek shareholder approval to 
remit the proceeds as capital 

On turnover of £4.72m (£6J>m 
including £1.69m from discon- 
tinued activities), pre-tax 
losses for the 12 months to 
April 30 widened from £60,840 
to £321,160. The outcome took 
in losses of £4L383 (profits of 
£75,336) at Homemaker and an 
exceptional write down against 
the US operation of £130,957. 

Nevertheless, Mr Jock Mac- 
.kenzie, chairman, remained 
upbeat. There had been a “sig- 
nificant improvement" since 
the year end, he said, with 
turnover at Peter MacArthur, 
the group's leading tartan 
manufacturer, “well ahead" on 
a year-on-year basis. 

The Homemaker disposal 
eliminated bank borrowings - 
interest charges dropped from 
£148*53 to £26,672. 

Losses per share were 8.88p 
(1-8P). 


Thb adwatfeematt fa issued m compliance with the regubuom of Thc lmcraMio ttd Sto ck Exchange ofihe 
United Kinedora and die Republic of Ireland (die “London Stock Exchange ). Applicati on has b een nude 
- to the LoXTsiock Exchange far tbe new ordinary shares to be issued pureuaru to Phong and Open 
Offer and for die existing ordinary shares and convertible preference shares of Carlisle Group Fk (_ the 
Owmaw") to be admitted to the Official list It is emphasised that dm .advnwemem does no r ronsnmte 
an oSr or invitation to any person to subscribe for or purchase seeunnes of th e Co mpany. It fa expected 
that admission wOl become effective and that deafiws m the Company* m tbe 

exist&ig ordinary shares and convertible' preference dona will commence on 8th December, 1994. 



CARLISLE GROUP Pic 

(lncorponuUwURep**** fa gsgWMs. SIMM} 

Proposed 

Acquisition of Strathinver Investments Limited 
and 

Placing and Open Offer of 
75,608,100 new ordinary shares at. 

20.26p per share by Collins Stewart & Co 

^ comptwoa of -d ^ ££££ 


tare . .. 

Authorised 

auwjit Nmkr 

ZO,000,000 200.006,000 

3 ,000,000. 5,000000 


Itmtd «nd/ruUj Pod 
Amunl v Mm * br 
£15.877.70! 158,777.010 

\ 1.112,772 


ordinary shares of lOpeach 
convertible preference shares 
of£l each 

to the Company may be obtained faring normal business hours on 
wo *» «“ ■ — -y - - (J] foom the Company Announcements Office of the London Stock 

iy weekday {fybhc Baribotamew Lm^LMdcm EC 2 N JHP-Ifor cofccwm only) from the 

iWtppd 1994 and from the date of this notice up to and 

tt of do* w»ce op B» 
iwfing 24 t!> November, 1994 from. 



. Walsh law**-' 

Potfand Hou «* 

14—1 6 Reg«M Street. 
London 5W1V 4PH 


10th November, 1994 


Carlisle Group Pic . 
6 Cartp* place 
Loodop WfV bLL 



TM» xtvenlteniL-m ^ In compliance with Ac requirement* of and ha» here approved by Ute Inwnxntonal Stock Exchange of tfnr United Kingdom and the Republic of (refold Unicoi (the toofai Stock Exchange") l*"*u** to 

Seaton 1S4UX3) d die Financial Servk-ii Ait 19HU tilts jJvertremera dues not contain jny infonreulun uhoua Mumay Emerging Btonaadei Trust PtC ("MHETT* loiter than Ibe Infonrcalon art m* below) arxJ iboukJ therefore he read in 
coniundton with the Lbting Piriikulan dated n November IW (iIk Usuw PanKulan-i which alone contain full detail* of MEET and the vccuriiio being offered. A p pli ca tio n has been made lo the London Slock Exchange l« Hw under- 
mentioned Onlbot> 4una and Warrant, In be jdmuied lo the Offu.ml Lul It la expected that listing wll become effective and dut separate dealing* In the Onfaluiy Shares and Variants will commence at HJQ am on 1 December L9>M. 


I incorporated in Scotland under the Companies Act 1985 with registered number 153320) 


Offer for Subscription 

of up to 65,000,000 Ordinary Shares of 25p each (with Warrants attached on a 1 for 5 basis) 
at an issue price of lOOp per share payable in foil on application. 


Sponsored by 

de Zoete & Sevan Limited 




m 


APPLICATION FORM 

for Ordinary Shares ( with Warrants attached) 


8** 


* 

-tfat Ir-riffE .. , rf .S' 



PERSONAL DETAILS 



make applications to subscibe for in aggregate 

Mr Mrs Miv» ur Tide 


45 , 630,300 Ordinary Shares (with Warrants attached) 

ForenameVs.) tin full) 

i 


Surname 

m 


Address tin full) 

U 

imum number of Ordinary Shares (.with Warrants 


\ oS 


Postcode 

IP 



id 


APPLICATION 


}wfa$$r 

y&fafam #? ? , ^ 

shoufcn* 

•• ; - Dtp ■ 

-£(3 AMOUNT PAYABLE f :' 

! # "sslw. <■ ■■ (i 1 . .tutf.'-t-' •• 1 " • " 1 .... j"^- 1 .ip&v ' * 

. ! ^wa ywdt;a far the' 

u:*' D\ ; ■ hi-.' - • • . }.? * r- ['ll if * 



.... *v r -.- feffifiSj 

' ••> \ x '■ ;■ • .i'toafrft# 

■ . s. ; : t.-tv. - v - ^ 

: -v jt. /"■?.: 


Manager 

Murray Johnstone Limited 


KEY INFORMATION 

Investment Objective 

Murray Emerging Economies Trust PLC aims to 
benefit from the grfcwth of emerging economies by 
investing in emerging and frontier markets world- 
wide for long term capital growth. 

de Zoete & Be van has received irrevocable under- 
takings from institutional and other- investors to 


Instructions for Delivery of 

Application Forms 

Completed Application Forms should be returned 
by post to Clydesdale Bank PLC, Registration 
Department, Balfour House, 390-398 High Road, 
Hford, Essex IG1 1NQ, or delivered by hand to 
Clydesdale Bank PLC. New Issues Department, 30 
Lombard Street, London EC3 so as to be received not 
later than 10.00 am on 29 November 1994. If you post 
your Application Form, you are recommended to use 
first class post and allow at least two days for delivery. 

If you have any queries relating to the Application 
Form please telephone Registration Department, 
Clydesdale Bank PLC on 081 478 1234. 

de Zoete & Bcvan Limited is a member of The 
Securities and Futures Authority Limited and the 
London Stock Exchange. 

Copies of the Listing Particulars and the mini 
prospectus arc available for collection from de Zoete 
& Bevan Limited, Kbbgate House, 2 Swan Lane, 
Iondon KC4R 3TS; Clydesdale Bank PLC, New Issues 
Department, 30 Lombard- Street, London EC3 9BB; and 
Murray Johnstone Limited, 7 West Nile Street, Glasgow 
G 1 2PX until 2? November, the dare the Offer doses. 

10 November 7flJW 



FINANCIAL TIMES 


THURSDAY NOVEMBER^ 0 



COMMODITIES AND AGRICULTURE 



Coffee prices fall on Brazilian crop report 


By Doboitfi Harg re a v es 

Coffee fen in London yesterday 
when estimates by the Brazil- 
ian government of the extent 
of damage to next year's crop 
disappointed traders by being’ 
in line with their expectations. 
Prices had been bid up in trad- 
ing earlier this week following’ 
rumours that crop damage was 


much greater than had previ- 
ously been anticipated. 

The January futures contract 
slipped $62 to $3,506 a tonne on 
the London Commodity 
Exchange as the New York 
market also slowed. By mid- 
day, coffee futures at the Cof- 
fee, Sugar and Cocoa Exchange 
had slipped by 2 cents a pound 
to $1.87. 


The Brazilian government 
has estimated the 1995-1996 cof- 
fee crop at between 12.7m and 
14.8m bags (60kg each) follow- 
ing two frosts and a prolonged 
drought. Government officials 
sai d the drought was likely to 
cause the crop to shrink 25 to 
30 per cent on top of damage 
already wrought by the frosts. 

After the frosts, government 


estimates put the crop at a 
minimum of 15.7m bags com- 
pared with the 26.5m bags 
which had been expected 
before. 

Even though the fall in the 
Brazilian crop will exacerbate 
tightness in world supplies by 
the middle of next year, ana- 
lysts say the market is well 
supplied. 


“There is plenty of coffee 
around right now. Sentiment 
in the market is turning bear- 
ish and there is a risk the mar- 
ket could drop sharply,” said 
Ms Judy Canes, commodities 
analyst at Merrill Lynch in 
New York. 

Brazilian officials -aid out- 
put was not likely to return to 
normal until 1997. 


Malaysia turns its back on commodities 

Pr imar y products have little place in the new industrial vision, writes Kieran Cooke 


I t is enough to Tr|a ^ p an old 
planter turn in his grave. 
Malaysia, for so long the 
world’s leading producer of 
natural rubber, is turning its 
back on the industry. 

“Malaysia is no longer inter- 
ested in producing rubber,” 
says Dr Mahathir Mohamad, 
the prime minister and main 
architect of the country’s 
recent high speed economic 
growth. “We hope to relocate 
the industry to neighbo urin g 
countries like Indonesia.” 

Dr Mahathir wants to make 
Malay sia a fully industrialised 
country by the year 2020; and 
production of primary com- 
modities like rubber and tin 
has little place in this vision. 
Critics say the government’s 
policies are misguided: in the 
rush to industrialise a vital 
part of the economy is being 
neglected - expertise and 
knowledge built up over the 
years will be wasted. 

Over the past 20 years the 
structure of Malaysia's econ- 
omy has been transformed, in 
the early 1970s rubber and tin 
made up nearly 70 per cent of 
Malaysia's exports. Last year 
manufactured goods accounted 
for 74 per cent of export values, 
with rubber representing less 
than 2 per cent and tin only 0-5 
percent 

Until recently Malaysia led 
the world in the production of 
natural rubber and tin. In 1988 
it produced L8m tonnes of nat- 
ural rubber but this year out- 
put is likely to foil below lxn 
tonnes. Both Thailand and 
Indonesia are now bigger pro- 
ducers than Malaysia. 


COMMODITIES PRICES 


Malaysian exports 


Total M$4hn 



Total M$ 121bn 

Manufacturing 

1&2% Rubber, pafrnoH 


03 and gas 
&0% 


and timber 
13% 



Rubber Manufacturing 
425% 74% 


Saras MHstty <* Fhrnee. Mnftfty of Trade and bxfosfty 


The decline has been still 
more dramatic in Malaysia's 
tin industry. In the early 1980s 
it was producing more than 

60.000 tonnes of tin a year. The 
industry - the foundation of 
the fortunes of of many the 
country’s early entrepreneurs 
- then employed more nearly 

40.000 people. This year tin pro- 
duction will probably be less 
than 6,000 tonnes and the 
industry’s workforce has 
shrank to about 2,000. 

The one bright spot in the 
commodities sector is palm oil. 
Encouraged by generally buoy- 
ant world prices, production 
has doubled over the last ten 
years to reach more than 7m 
tonnes last year. Malaysia now 
accounts for about 55 per cent 
of total world palm oil output 

The foil in world prices for 
most of Malaysia's primary 
commodity exports In recent 
years has been blamed for the 
sector's decline. But commod- 
ity producers argue that gov- 


ernment policies have acceler- 
ated the process. “The govern- 
ment is obsessed with manu- 
facturing and ignores the 
potential - and the problems - 
of the commodity sector.” says 
one rubber producer. “Yet 
commodities are still a central 
part of the economy.” Last 
year Malaysia’s commodity 
exports, including forestry 
products but excluding oil and 
gas. were worth M$25.2bn 
(£6bn). 

W hile the share of 
commodities in over- 
all export earnings is 
de clining the statistics are mis- 
leading. 

Commodity producers say 
their export earnings are of for 
more direct benefit to Malay- 
sia’s economy than exports 
from the manufacturing sector. 
Multinational electronic com- 
panies. operating mostly in 
free trade zones, account for a 
large proportion of Malaysia’s 


manufacturing exports. Those 
exports have a high ratio of 
imported content. A large 
amount of the funds from man- 
ufactured exports does not 
flow back into Malaysia but is 
repatriated overseas. 

Labour shortage problems 
are particularly acute in the 
commodities sector. Local 
workers have drifted to jobs in 
factories in the cities and 
towns: most of those left 
behind in the rubber planta- 
tions and oil palm estates are 
elderly. As a result thousands 
of immigrants are working in 
the commodities sector: on 
some estates more than 70 per 
cent of employees are from 
Indonesia or Bangladesh. 

The plantations object to 
paying a M$300 government 
levy, plus recruiting expenses, 
for every foreign worker 
employed. After a few months, 
many immig rants go to jobs in 
the manufacturing sector. Mr 
Borge Bek-Nlelsen. who runs 


94,000 acres of palm oil planta- 
tions on Malaysia's west coast, 
says action must be taken to 
keep workers on the land. “In a 
way we are subsidising the 
industrial sector, “ says Mr 
Bek -Nielsen. 

Malaysia bas made substan- 
tial investments to develop 
downstream commodity indus- 
tries. But producers say that if 
more attention is not paid to 
sustaining commodity output, 
downstream factories will be 
starved of raw materials. 

In the first seven months of 
this year Malaysia's natural 
rubber imports increased by 53 
per cent compared with the 
same period last year. In the 
first half of 1994 the country's 
domestic tin in concentrates 
production fell below consump- 
tion - a position undreamt of 
just a few years ago. 

Malaysia leads the world in 
many aspects of commodity 
research and development Its 
rubber, palm oil and cocoa 
plantations are among the best 
run and most productive. Pro- 
ducers say the government 
should encourage investors to 
capitalise on this expertise 
rather than continually urging 
people to put their money into 
the manufacturing sector. 

Mr Urn Keng Yaik, the min- 
ister of primary industries, told 
a planters conference in Kuala 
Lumpur this month that peo- 
ple should not feel that the 
production of primary com- 
modities In Malaysia had 
reached the end of the road. 

But Dr Mahathir clearly feels 
this point has been reached in 
natural rubber production. 


Windwards 



oyer 


delay to EU banana deal 


By Deborah Hargreaves 

Banana exporters from the 
Windward Islands are becom- 
ing increasingly impatient 
with internal wrangling at the 
European Commission that bas 
delayed a transfer in their sup- 
ply quotas for the fruit 

Windward Islands' exporters 
are awaiting a change in their 
quotas so that they can ship to 
the European Union bananas 
from elsewhere, such as Latin 
America, to compensate for the 
loss of their own crop in tropi- 
cal storm Debbie in September. 

The commission's banana 
management committee has 
already recommended a quota 
transfer for the islands, but the 
proposal has been blocked by 
German commissioners 
because of Bonn’s opposition to 


the whole toianargme. 

“We're getting frustrated- we 
can’t defray our fixed costs or 
keep our regular customers 
supplied unless we get a quota 
Increase,” said ML Bernard 
Camibert, Windward Is lands* 
hanana London representative. 

St Lucia, for example, is 
shipping only 3,000 tonnes of 
hanana*; a week to the EU mar- 
ket following the devastation 
of its crop- At tins time m a 
normal year, its deliveries 
would be closer to 6JM0 tonnes. 

Mr Comftert says that meet- 
ing the same range of fixed 
costs on smaller tonnages of 
fruit bas increased costs by 20 
to 25 per cent At the same 
the islands risk losing 
customers who they are at 
present unable to supply. 

He said it would lake St 


‘U ntr anspar ent’ LME attacked 


By Kenneth GoocSng, 

Mining Correspondent 

The antipathy some metal 
producers and consumers fed 
about the London Metal 
Exchange was voiced yester- 
day by Mr Yves Rambaud, 
chairman of Eramet of France, 
the world's fourth-largest 
nickel producer. 

Questioned about the recent 
sharp rise in the nickel price at 
a time when exchange stocks 
were also increasing, he said 
the LME was a “very untran- 
sparent market.” It was not 
possible, for example, to know 
who owned the stocks in LME 
warehouses. 

He said consumers were 

“frightened” of flu* T.MR and 

more and more of them were 
looking for long-term supply 
contracts from producers. 
About 80 per cent of Eramefs 
nickel went to stainless steel 
producers. Mr Rambaud told 
the Association of Mining Ana- 
lysts in London. These custom- 
ers wanted two thing s in par- 
ticular: continuity of supply 
and prices not to move outride 
a certain range which elimi- 
nated the peaks and the 


The London Metal Exchange 
board agreed yesterday to 
open warehouses for copper in 
the US. 

The locations, available 
from April L 1995, “subject to 
there being suitable approved 
warehouse companies operat- 
ing there by this date”, would 
be New York/New Jersey, Chi- 
cago, St Louis and Los 
Angeles/Long Beach, the 
exchange said. 

troughs la LME prices. About 
half of Eramefs sales were 
made on long-term contracts 
with these terms. “Both we 
and the consumers agree this 
is a good system,” he said. 

Mr Rambaud suggested that 
demand in the western world 
for nickel this year would grow 
at between 7 and 9 per cent, 
compared with 5 per cent In 
1993 and well above the annual 
average of 2J per cent seen In 
the past 20 years. This would 
leave the market in balance 
because there was no room for 
western producers to increase 
output and no possibility that 
Russian exports would grow. 
Eramet previously forecast a 


supply surplus of 15*000 tonnes 
this year compared with sup: 
pluses of 49,000 and 75*000 
tonnes in 1993 and 1992. 

He pointed out that Russia's 
production co uld not. inrrp ag p 
unless big investments were 
made in its industry and then 
it would take three or four 
years for this investment to 
have an impact.' Meanwhile, 
nickel consumption in Russia • 
was at such a low level it could 
hot fell much further . 

Western producers needed 
an average price of 53 to SL20 a 
pound to break even but a 
price of $3.59 to $4 was 
required to make it worth 
investing to expand existing' 
capacity. Prices of more than 
$5 were needed for new capac- 
ity. The LMB three-month' 
price closed last night just 
below last week’s 2%-year high 
at $7,427.50 a tonne. 

Eramet previously 
announced it would lift annual 
capacity at its 82-per-cent- 
owned SLN (Societe MetaHur- 
gique Le Nickel) in New Cal- 
edonia from 50,000 to 60,000 
tonnes. Mr Rambaud this 
would be done step by step, “in 
line with market growth”. 


BASE METALS 

LONDON METAL EXCHANGE 

(Prices from Amalgamated Metal Trading) 

■ ALUMtNKIM, 90 J PURITY (S per tonne) 



Cash 

3 mths 

Close 

1846-47 

1858-69 

Previous 

1839-40 

1855-56 

Kfgh/Iow 

1871/1858 

1883/1842 

AM CKficW 

1871-73 

1880-81 

Kert) dose 


1843-4 

Open Irt. 

260987 


Total daily turnover 

B19Q2 


■ ALUM04U1M ALLOY (S per tonne) 


Ckne 

1830-40 

1B60-70 

Previous 

1620-25 

1850-53 

Hgh/knv 


1870/1840 

AM OftlcM 

1B3S-46 

1885-70 

Kerb dose 


1840-5 

Open ft*. 

2,958 


Total dafly ftanover 

406 


■ LEAD (S par tome] 



Closa 

664-66 

6799-809 

Previous 

607-68 

6839-84.0 

tflgh/low 

668 

688/878 

AM Official 

668-689 

684-849 

Kerb dose 


880-1 

Open M. 

43,708 


Total dally turnover 

7982 


■ MCKELS par toms) 


doss 

7305-15 

7425-30 

Previous 

7345-55 

7465-70 

HJgMorv 


7560/7390 

AM Offldal 

7420-26 

7550-55 

Kerb ckne 


7395-400 

Open ir*. 

73904 


Total d&fiy turnover 

9963 


■ TW (3 per tome) 



Close 

6110-20 

6200-10 

Previous 

6100-70 

6255-60 

HfflMow 


6200/6160 

AM Official 

6186-76 

8255-85 


Precious Metals continued 

■ GOLD COMEX pOO Troy oz^ S/trey ce.) 

Safi Ban Caen 

price chugs Ugb loer kt Vd. 
Mb* 3833 -0.1 - - - - 

DM 3845 -03 3818 383J 84122 21394 

Jm 3862 -03 - - 23.108 i m 

Mi 38&2 -03 m3 387.8 10,115 401 

PIT 391.8 -03 3923 391.4 10,477 7B 

Jim 3958 -03 3978 385.1 6.174 

TaW 16O80B 30JM7 

■ PLATINUM NYMEX (50 Troy ca^ $/bcy qgj 


GRAINS AND OIL SEEDS 

■ WHEAT LOEg per tonne) 


SOFTS 

■ COCOA LCE (C/lonne) 


Uar 

ter 


10420 +020 10425 
10530 +025 105.30 
107-35 +020 107.35 
10035 +030 109.35 
111.40 +0l25 
9426 +050 94-25 


Lon tat 

10400 522 

10500 1079 
10000 1042 
10800 1017 
- 120 
9400 43 

8020 


Jan 

4069 

-39 

4129 

4069 18708 

9,694 


41X3 

-39 

4179 

4119 

8210 

2912 

M 

417.7 

-17 

4139 

417.7 

1906 

7 

Oct 

4229 

-17 

4229 

4229 

499 

2 

Jn 

4259 

-17 

• 

- 

10 

- 

Tbtaf 





27933 12,115 

■ PALLAD8JM NYMEX (100 Troy OZ4 S/troy OzJ 

Dm 

15910 

-295 

15990 15690 

4985 

1966 

Mm 

15790 

-100 

18800 

15790 

1177 

445 

Jm 

15890 

-100 

18190 

15890 

470 

17 

Sap 

15995 

-100 

- 

- 

31 

- 

Tore 





7983 

1,98 

■ SJLVH1 COMSC (100 Troy oz.; Canta/lrey ozj 

an 

5184 

-184 

. 

. 

50 

50 

Dm 

5119 

-107 

5249 

5180 70982 15923 

Jbb 

5141 

-119 

5159 

5159 

89 

- 

Be 

5281 

-119 

5329 

5189 22.784 

297 

Hay 

5259 

-11.1 

5389 

5240 

4921 

as 

JH 

son 

-119 

5440 

•oan 

4,381 

384 


Sop 

Tom 

* WHEAT car POOObu min; cano490tb bushel) 

DM 38012 -6/4 386/0 378/2 33006 SOB1 

Mm 302/0 -6/0 396 « 390/0 26,687 4322 

Hey 363/4 -5/2 3734) 360/0 4,420 430 

Jd 337/6 -5 « 341/4 337/0 11524 1.305 

Sap 342/4 -4M 3434) 341/6 308 14 

Dm 352/4 -&0 353/4 352/4 156 2 

ToM 75488 13084 

■ MAEE C8T (5Q00 bu mtai; cerm/56to bunhct) 

Dm 21310 +2/0 219/2 2150109,478 17056 

Mm 230/2 +1* 230/4 228/6 87,297 5037 

M IT 238/2 +2/2 238/4 234/2 21877 2,105 

JM 243/2 +20 243/4 233/4 35.403 2503 

Sep 247/6 +1/4 248/0 24AM 3328 165 

Dm 252/0 +1/4 253/0 249/6 11631 1.298 

TMM 25*02 2*244 

■ BARLEY LCE (E per tonne) 




Sett 

oaf* 



Open 



Vd 


prica 1 

change 

MB" 

Low 

bit 

Vd 


27 

Dm 

939 

+5 

90 

936 

19212 

1.735 

Dm 

73 

Hm 

964 

+4 

967 

961 

42730 

1.955 

Feb 

21 

tey 

973 

+« 

977 

971 

14001 

258 

Apr 

42 

Jd 

985 

♦6 

968 

985 

6587 

31 

Jm 

- 

sw 

997 

+4 

1004 

997 

12589 

249 

aw 

11 

Dm 

1013 

♦3 

1021 

1013 

9574 

318 

Oct 

280 

Tore 




112,137 4778 

Tore 


■ COCOA CSCE flO lomaa; S/tomasi 

DM 


MEAT AND LIVESTOCK 

■ L OT CATTLE CME(4aOOOKa;cmttMlbW 

Sail Den QpM 

price cftMge F6gh Low 1st Vd 

6399) -0275 70950 63.49) 30988 7.427 

81500 -Q025 09925 £3900 22.457 Z55I 

63.900 -0075 70000 61450 15957 1,250 

65525 -0100 65625 65.425 5091 575 

64900 -0150 64950 64050 1971 82 

SL150 .6925 66990 65 mn 302 1 

75J51 11.B88 

■ LOT HOGS CME (40.000033; twfcwttss) 


1291 

-9 

1301 

1284 11517 3265 

Dm 

*p am +Q2S0 niBn gwi 

11589 

4229 

1327 

-12 

1339 

1324 

33598 

3528 

Ftft 

36575 +0,175 31700 31150 

10275 

2610 

1354 

-9 

1363 

1351 

HUB? 

156 

Apr 

37.400 +0.175 37.450 36550 


988 

1382 

-6 

1386 

1382 

1440 

155 

Jm 

42700 +0250 42750 42200 

2565 

238 

1405 

-B 



1,499 

2 

At« 

42150 +0150 42150 41550 

508 

80 

1435 

•6 

1440 

1433 

5574 

29 

Od 

-?D7nn *0250 vp non 

403 

30 





71582 7,198 

Tow 


38.142 

8217 


dm 

ToM 

■ COCOA 0CCO1 (SDR - 5/tonne) 


Mo* 8 

Daly _ 


■ COFFEE LCE (SAonne) 


Price 

365.12 


Pm. day 
961.65 


Total 


115977 10(711 


ENERGY 

■ CRWE OB- NYMEX (42Q00 US gafift. S/banaQ 


Kerb dose 6160-70 

Open M. 21.062 

Total da»y turnover 3,074 

■ ttjO epecW htgti grade (> par tonne) 


Closa 

1137-38 

1160-61 

Prevtoue 

1161.S-525 

1174-75 

Mgh/hw 

11655 

1180/1155 

AM Offldd 

1165-66.5 

1177-78 

Kerb dose 


1155-7 

Open bit 

108597 


Total daSy turnover 

25,753 


■ COPPER, grade A (9 par tome) 


Close 

2672-73 

2645-46 

Previous 

2707-11 

2880-84 

HgMow 

2716 

2887/2629 

AM Official 

2717-19 

2880-82 

Kerb dose 


2843-4 

Open Int 

222106 


Total dafly turnover 

87.926 



■ LME AM OfHcW OS ratae 10024 

LME Ctaring S/S rate: 10043 

Span .8066 3n*®1D0*4 60*1X1.8021 BmBKlOBSa 
i (COMEX) 




Of 






CUM 

eftaaga 

a* 

Ion 

re 

fid 

Nov 

12350 

-055 

12150 

12250 

1^32 

180 

Dm 

12270 

-120 

12550 

12150 37571 

12DB 

Jm 

12200 

-150 

12150 

12150 

932 

22 

Fd> 

12155 

-075 

12080 

12080 

585 

20 

Otar 

120.70 

-050 

122.10 

11150 10564 

1.4® 

Ayr 

11120 

-065 

12020 

12050 

722 

28 

IMd 





BM80 11J55B 

PRECIOUS METALS 



■ LONDON BULLION MARKET 
(Prices awvAad by N M BothscMtfi 





Ldest 

Oaf* 


Open 



prtos 

diMB* 


law re 

M 

DM 

1138 

-020 

1167 

1132 78546 41014 

Jm 

1130 

-009 

1140 

1119 82,783 27.120 

Feta 

1117 

-006 

1123 

1108 40533 10451 

MV 

1857 

-008 

1110 

1757 24,748 

3560 

Air 

11C0 

-007 

1850 

1100 17.450 

1127 

tey 

1750 

-013 

1751 

1759 12246 

1,784 

Tatd 




394570 81010 

■ CRUDE ON. IPE (S/barreQ 




uitest 

Of 





dfca 

timm 


l am tao 


Dm 

1734 

-014 

1758 

1755 61855 24583 

Jen 

1198 

-006 

1859 

1187 10,715 19,119 

M 

1650 

-OJO 

1182 

1170 23534 

3570 

Bar 

1859 

■001 

1180 

1180 11.588 

2544 

Apr 

1158 

■005 

11SS 

1154 5595 

1507 

ter 

1850 

+001 

1650 

1154 3552 

. 

Tore 




187588 91508 

■ HEATING CM. MYM3C (4ZJJQ0 US gdh; c/US gab) 


Lated 

Oaf* 


Open 



Flo 

tenge 

n* 

lav W 

M 

Dm 

5095 

0.10 

5150 

5050 42.490 14252 

Jm 

5145 

056 

5150 

51.15 31527 

1503 

Feb 

6150 

+005 

5150 

5155 22508 

888 

Mar 

6145 

-040 

5155 

5155 12534 

1577 

Apr 

3LB5 

045 

5065 

SILK 7591 

148 

tey 

5005 

-058 

5005 

5055 4530 

3 

TbM 




181290 73,724 

■ QAS OB. K (Vkxnd 





No* 

9955 

-170 

9350 

9950 

5 

5 

Jm 

10250 

■150 

10225 

10250 

484 

9 

Hv 

10450 

-040 

10450 

10050 

130 

- 

tey 

10650 

-025 

- 

- 

48 

- 


9125 

+150 

9025 

9325 

15 

5 

Nov 

34.75 

+170 

9475 

9450 

10 

11 

Tow 





8B2 

3i 

m SOYABEANS CBT frOOCba nta; cadMOft tebaQ 

No* 

561/2 

+3/2 

563/4 

553/4 

1786 

1705 

Jm 

572/0 

+3/0 

574/0 

584/2 57,918 28528 

ter 

582/2 

+3/2 

5842 

574/4 25458 

1793 

te» 

690/4 

+2/0 

592/0 

5844) 13578 

878 

-re 

5984) 

+2/4 

5984) 

583/2 21538 

1532 

Ano. 

nan 

♦1/4 

801/0 

593/0 

1jB07 

58 


136062 44022 

■ SOYABEAN ON. CBT {BOPOORa: centaAbj 


Nov 

3468 

■82 

3535 

3468 

43 

45 

JM 

3517 

-51 

3800 

3505 

12545 2521 

Nv 

3478 

-37 

3550 

3463 

8235 

1.720 

tey 

3448 

-27 

3515 

3440 

3426 

355 

Jri 

3413 

-Z7 

3488 

3413 

1511 

224 

Sep 

3405 

-23 

3470 

3405 

1583 

217 

Tow 





27548 4582 

■ COFFEE •C* CSCE (37500ft»; carfiariba) 


Dee 

18690 

-Z10 

19250 

185.10 

1856 1682 

Mr 

191.75 

-225 

19750 

19050 

13519 5538 

Hay 

19195 

-255 

20100 

19145 

5555 

514 

Jd 

19575 

-ITS 

201.00 

19550 

1540 

573 


19120 

-105 

20200 

19100 

1547 

121 

Dm 

19840 

-175 

20250 

19825 

950 

70 

Tow 





31481 11810 


■ PORK BELUE3 COT (40.000833; catts/lba) 

Feb 40900 +0.425 41900 40425 8979 2913 

■Mr 41075 +0900 41.400 40650 1900 120 

May 42050 +0900 42400 41-650 334 21 

M 42900 +0.175 41200 42400 337 21 

Mag 41925 +0.175 42200 41900 84 17 

TaW 10/04 2932 


JOTTER PAD 


CROSSWORD 


No.8,607 Set by GRIFFIN 


LONDON TRADED OPTIONS (T 

Strike price $ tonne — Cafe — - — Puts — 


■ ALUMINIUM 


|ICO)|U8 cenM/frniBS 


Dm 


Sell Day* OpM 

pice dnge Up Uar U M 

151.75 - 15100 15195 16,446 7958 

15495 +025 15500 15395 33,078 6,433 

JM 1S&25 +0.75 158.75 15595 22935 1923 

Ml 15795 +0.7D 15795 15B90 9932 338 

Ba 15700 +100 15700 15695 7927 333 

Apr 15500 +0.75 15525 15500 3932 9 

Trial 18*05 18986 

■ NATURAL GAS NYKX [11000 ntnOtu; S/taanStL) 


Dm 2110 +147 2117 27 JO 37J7B 11120 

•laa 2721 +053 2722 2148 21712 1717 

ter 3822 +043 2845 2673 11188 4.792 

tey 2557 +140 2170 25.10 11509 1417 

Jd 25.12 +130 2520 24,72 6595 1538 

Aqj 2455 +030 2455 2455 1516 116 

taw IftZjDBB 28513 

■ SOYABEAN MEAL CRT (100 tons; 3/tor) 

Om 

1595 

-05 

1801 

1585 31758 

4508 

JM 

1614 

-17 

181J 

1805 20404 

1770 

Mv 

IK. 4 

•05 

1865 

1645 16588 

1.729 

tey 

1702 

■02 

1708 

160.1 

9J06 

123 

re 

173.1 

-14 

1765 

1742 

9494 

875 

Are 

1774 

. 

1772 

1713 

15® 

32 

Tefal 




181240 11581 

■ POTATOES LCE (E/tome) 




ter 

1064 

. 

. 

. 

. 

. 

Apr 

2395 


2400 

2374 

1-4S5 

74 

tey 

2504 

- 

- 

- 


- 

Jm 

ryin 

• 

- 

- 

- 

- 

IbW 






74 

m FROQHT (HFFEX) LCE (SlQAndax pdrd) 


Nov 

1830 

+40 

1839 

1795 

2S7 

23 

Dm 

1745 

+35 

1745 

1720 

358 

145 

Jm 

1680 

+35 

1680 

1645 

1465 

ST 

Apr 

1840 

+22 

1840 

1630 

878 

22 

re 

1473 

+33 

- 

• 

132 

- 

Jm 

1540 

+86 

- 

- 

17 

- 

Told 





2,705 

247 


Qme 

hi* 





BH 

1880 

1835 






Price Pm day 

18194 17594 

18000 18094 

■ No7PnaWJMRAW8UGARLCE<cgTta^33) 


■0*8 

Coep. itarijr 
15 day 


Jm 

1100 

. 

_ 

. 

. 

. 

ter 

1353 

4.14 

- 


90 

- 

ter 

1148 

-111 

- 


560 

- 

Jm 

1340 

+102 

- 

- 

450 

- 

Told 





1,100 

- 

■ WHITE SUGAR LCE (SAome) 



Dm 

369.70 

-180 

37150 

36940 

2270 

921 

ter 

36320 

+120 

36190 381.60 

9JS2 

837 

tey 

35150 

+110 

35170 

35740 

1394 

577 

Are 

35080 

+130 

35150 

350.00 

2755 

283 

0d 

32520 

+110 

32840 

32140 

1.113 

96 

Dm 

32420 

+110 

324.80 

32440 

98 

20 

IMd 





HOBO 2784 

■ SUGAR 11' CSCE (1124001b; centaflba) 


ter 

1115 

. 

1322 

110710342011577 

tey 

1121 

■103 

1124 

1115 29.179 5480 

Jd 

1346 

♦042 

1349 

1238 

17,729 3408 

Od 

1240 

+105 

1243 

1235 

11260 

2278 

■tar 

1200 

+105 

1205 

1240 

2564 

BIB 

tey 

1200 

■145 



159 

- 

Tew 




1819323559 

■ COTTON NYCE (50.000fcs; cents/foe) 



(99.7%) LME 

Jan 

Apr 

Jan 

Apr 

1825 — 

79 

117 

64 

92 

1S50 .... 

87 

105 

77 

104 

1875- 

58 

94 

91 

117 

■ COPPER 





(Grade A) LME 

Jan 

Apr 

Jan 

Apr 

2150 .. 

88 

90 

83 

158 

2700 . 

68 

73 

110 

189 

2760 

48 

58 

142 

223 

■ COFFSLGE 

Jan 

Mar 

Jon 

Mar 

3400 

267 

364 

ISO 

286 

3450 

240 

340 

173 

312 

3500 

215 

316 

198 

340 

■ COCOA LCE 

Dec 

Mar 

Dec 

Mm 

925- 

20 

71 

8 

32 

950 - 

7 

57 

18 

43 

97S — _. — . 

2 

45 

38 

56 

■ BRENT CRUDE IPE 

Nov 

Dec 

Nov 

Dec 

1B50- 

71 

82 

6 

42 

1700... __ 

26 

68 

9 

66 

1750 

7 

34 

27 

95 


9- 


Lucia up to-9 mouths to restore 
production to its former levels,: 
but its rehabilit ation plans are 
dependent on aid from the EU 
under -the' Stabex ec onomi c . 
programme. St Lada, expects 
to receive Ecu aLSfa.aafl Domi- 
nique should getEca 3j6m, but 
payment of the grants has also 
been delayed. ; ' . ■/. jv 
: Bananas from African, Carib- 
bean and Pacific .countries 
enter the. BU tariff-free, but 
quotas and tariffo are imposed 
on stecaBed;^ dollar bananas 
from Latin America under the 
EU*s import regime, " v.v 
The regime is .so controver- 
sial that the commission is sty- 
mied on whatever' action ft 
tries to. take by. opposition, 
from Ge rm any . An -Official said 
the quota issue bonld come to a : 
vote next Wednesday. 


r tF U" 

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if 


tc 

<£•* • 

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fP- c. 

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#• 


LONDON SPOT MARKETS 

■ CRUDE (ML FOB (per bwreVDec) +or- 


Utnt Baf* 


Qpm 


Gold (Troy oxJ 
Ctaae 
Opening 
Morning Ac 
Afternoon fix 
□ay's High 
Day's Low 
Previous done 
Loco Ldn Mean I 

1 mont/i . . ..... .. 

2 months 

3 monffie 

Steer Fix 

Spat 
3 months 
8 raomhe 
1 year 
Gold Colne 
Nruganand 
Maple Leaf 
Now Sovereign 


S price 
36420-38490 
38490-385.00 
384.35 
383.60 

384.70-386.10 

383.40-383.80 

38490-38690 


E eqvJv. 



■pb 

IM W 

Vd 

Dm 

1-780 +0008 

1.780 

1.755 28J»7 12417 


Jm 

1.910 +1006 

1425 

1-900 21.771 

7401 

231016 

239227 

Fab 

1485 +11X11 

1410 

1485 13438 

2413 

ter 

1460 +1012 

1465 

1448 UH6 

852 

Apr 

1420 +1007 

1425 

1420 7.191 

743 


tey 

1435 +1019 

1435 

1430 1733 

384 


Tatd 



141180 28488 


Dm 

7225 

■074 

7240 

7140 21448 4.148 

ter 

7345 

-178 

7440 

7350 1854) 2487 

tey 

7545 

-157 

7540 

74.65 

75B5 

279 

Jd 

7143 

-187 

7540 

7H0 

4578 

382 

Od 

7043 

■147 

7170 

7150 

600 

- 

DM 

69.40 

-140 

6840 

8140 

1QZ7 

137 

TnW 





88408 7433 

■ ORANGE MCE NYCE ns.O00R»;eanta«M) 

tev 

1DB40 

-a 10 

109.50 

10125 

340 

38 

JM 

11120 

-020 

11120 11140 14417 

1299 

ter 

11185 

■125 

11180 

11175 

5525 

361 

te» 

11945 

■140 

11950 

11025 

1.642 

175 

Jd 

12115 

-0.45 

12240 

12240 

910 

1 

Sap 

12540 

-120 

12550 

12100 

1444 

226 


■ UNLEADH) GASOLME 




fflftEX (42400 US gMs; c/US gate) 



446 12 mantis 

■4.94 

- 542 


Latest 

price 

Day* 

(Mag* 

Ifeft 

Urn 

WM 

W 

M 

p/boy OZ. US cS equlv. 

DM 

5748 

-083 

8110 

58.10 Z746B 23.731 

32440 

52100 

Jm 

5U0 

-187 

5845 

g;on 

20,190 

8496 

32140 

52740 

FSb 

55.10 

-140 

53,10 

5440 

7487 

2468 

33445 

53445 

ter 

naan 

-040 

- 

- 

445S 

421 

34170 

55340 

re* 

5140 

-075 

5130 

5130 

4416 

489 

9 pries 
388-380 
39645-397.70 
9040 

£ equftr. 
239-242 

50-59 

tey 

TbM 

5195 

-190 



1420 

8B4B8 

233 

38489 


Cotton 

Liverpool- No spot or a M pmant sales were 
reco r ded for the werit ended Nove mb er 4 
against 42 tames In the prmtous week. Activity 
me seventy restrained and txnkiesa was on 
narrow fetes. Coat of nav cotton dataned uaera 
ftom hn wri g theft- pwchases. 


28,145 2,130 


VOLUME DATA 

Open fra ereet end Volume data sh own for 
co ntra cts traded on COMEX, NYMEX CST, 
NYCE. CME CSCE end IPE Crude OB are one 
day In 


INDICES 

■ REUTERS (Baas 18/8/31 -100) 


Nov 8 Nov 8 

21189 21109 

■ CRB Futures (Bass 1967-100} 


month ago 
20439 


1B14.7 


Dubai 

Sllll-llBz 

+1135 

Brent Band (dated) 

*17^6-7.47 

-1040 

Brent Blend (Dad 

SI 7.33-746 

+0.100 

W.T.I. Ppm eat) 

81845-1372 

+0050 

■ ON. PRODUCTS NWEpronv* dafvery OF Donne} 

Premium Gasoline 

$171*174 

-I 

GaeCX 

$157-158 

+1 

Heavy Fuel OB 

5101-103 

+1 

Naphtha 

SI 71-173 

+25 

Jst fuel 

S179-181 


Dead 

$162-163 

+■1 

Poorjhtum Aigm. r«( London 1071) as 9 S79Z 


■ OTHER 



Gold (per bay aatf 

S384.40 

-OJO 

SOwr (per troy ai)* 

5224c 

-44 

Platinum (per nay nr) 

S40845 

-£00 

PaUacBum (par troy oeL) 

SI 5745 

+025 

Copper (US prod.) 

129.0c 

-1 J3 

Lead (US pradi 

4175c 


Tin (Kuda Lumpu) 

1159c 

+0.09 

Tin (Now York) 

285.5c 

-15 

Catfia (kve wdgtit)t 

1154Cp 

nfc* 

Sheep (ffve viraghCt* 

101.17p 

+£2T 

Pigs (live weight) 

7118p 

+081- 

Lon. day sugs traw) 

S327.00 

-330 

Ldtl day sugar (wte) 

S37840 

■040 

Tata 1 Lyle export 

£31100 

-1J» 

Barley (Eng. fuod) 

Unq. 


Mslaa (US No3 Y ederw) 

132-0y 


Wheat (US Dark Nortifi 

165AI 


Rubber (Dec)f 

85.75p 


Rubber (Jan* 

8S45p 


Rubber (XL RSS Nol Juf) 

342.0m 

-1.0 

Cocmit OR (PNQ§ 

STOO.Oq 

+12-5 

Pafm ON (Mai^i4§ 

S887 St 

+110 

Copra (Phffi§ 

S457.&, 

+9^ 

Soyabeans (US) 

eiea.ot 


Cotton OufiodCA' fcxSex 

7850c 

-005 

Wodtopa I84a Super) 

440p 




Nov 8 

233. 9 7 


Nov 7 
23391 


22798 


t per toma untoes tstnrwbv statatL p pvncriM. o centWb. 
r rinflB*/*u. m ll nl 1 I nn c ' " - — 

OcMM*. i DSC. t MOV. q I 

n oeed n i f Birion m ai Kai 1 

Prices). ‘ Oange an «Mt e ntom m k* prim day. 


■s 

ira (Jobs, 4 *wvp,|ja 


ACROSS 

1 Long after work drops off stop 
getting pain (6) 

4 Enthusiast takes work - and 
during dance! (8) 

10 Terrible wind forced MEP to 
try going outside (7) 

11 It's a strange thing, is percep- 
tion (7) 

12 Travel free to the centre of 
Leeds (4) 

13 Pause to give drink to mole 
( 10 ) 

15 Potting animal in pen is silly 
(6) 

IS Lays out money on plant (7) 

20 European head left service- 
man imprisoned (7) 

21 Go before two soldiers (6) 

24 Being victorious fay Advent, 
finished first ( 10 ) 

26 Mum turned to go (4) 

28 It needs an intelligent rimn 
around here! (7) 

29 Changed reply MO made to 
“synthetic material” (7) 

30 Possibly tries tea-making 
pamphlet (8) 

31 Reprove retiring fellow seek- 
ing forgiveness (6) 

DOWN 

1 Celebrity on list left off 
embracing one musician /g) 

2 Next time 1 made stew (9) 

3 Snooker players use these 
Uses when speaking (4) 

. 6 French friend with a message 
is affable (8) 


6 Good-looking person was tak- 
ing girl’s kitchen cleaner (10) 

7 Can stand around Gateshead 
hospital when dark (5) 

8 Uproar after court members 
start yelling (6) 

9 Second flier is back on board 
(S) 

14 Produce airmen in court 
showing theatrical skill (10) 

17 Poor actor enters, nude as 
could be. unrepentant (9) 

18 A man turned up in men's 
clothes (8) 

19 Her Brent organisation Is for 
religious body (8) 

22 While talking saw Elizabeth 
Sweet? (6) 

23 Spin round, point to bird (5) 

Z5 One didn’t want to leave 

home (5) 

27 Pop round the local, making 
an excuse! (4) 

Solution 8,606 



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financial times 


THURSDAY NOVEMBER JO t<j94 ' 


31 


LONDON STOCK EXCHANGE 


MARKET REPORT 

Election news gives strong boost to equities 


By Steve Thantpson 

A burst of strength by the dollar, 
which helped stimulate a round of 
big gains across interna tional bond 
marhets. provided the perfect trig- 
gar for a London stock market 
to move ahead yesterday. 

The wave of Republican victories 
in the US mid-term congressional 
elections set the scene for interna- 
tional markets, with the dollar rac- 
ing higher as the election news 
swept around the world, boosting 
bond and equity markets. 

The euphoria produced by the 
dollar saw the FT-SE 100 index pen- 
etrate the 3,100 mark in midsession 
before coming off the top minutes 
before the close of trading and set- 
tling a net 35.8 up at 3,099.6. 

The late downturn in London 
came in the wake of a sharp setback 


on Wall Street, where the Dow 
Average, up 38 points shortly after 
the opening, was virtually level as 
London closed and down almost 10 
points an hour or so afterwards. 

Traders in London professed con- 
cern at the slide on Wall Street, 
which they said led to some deter- 
mined selling of the Footsie future 
after hours. ‘‘We felt very Him all 
day, but things are getting confused 
now; Wall Street remains the key to 
European markets.” said one dealer. 
He added that the next phase of the 
series of US bond auctions, which 
total 529bn, would be crucial to the 
market’s performance, as would the 
Bundesbank meeting today. 

A senior marketmaker at one of 
the big European securities houses 
adopted a more positive view of the 
market, taking the view that a bout 
of profit-taking had been expected 


after a near 50- point rise in the mar- 
ket. “J think we'U be fine, as long as 
we can hang on to close above 3.100 
at the end of the week,” he said. 

One real bonus for the market 
post the US elections was the sharp 
increase In the level of business yes* 
terday. Turnover expanded rapidly 
to reach 728.3m shares, the highest 
for almost a mouth. It was painted 
out. however, that “bed and break- 
fast”, or tax-related deals, 
accounted for at least 15 per cent of 
that total. A large number of these 
trades were said to have been exe- 
cuted by UBS, the Swiss securities 
house. There are rumours in the 
maritet that the UK chancellor of 
the exchequer could include moves 
to prohibit such deals in the 
November 29 budget. 

The FT-SE 100 began the session 
in fine form, with market makers 


hoisting their opening prices and 
pushing the 100-index up 12 points. 
Buying interest from international 
institutions began to gather 
momentum in mid -morning, when 
dealers picked up hints of a strong 
opening by Wall Street, and the 
index surged ahead to the day’s 
peak of 3,112.0 shortly before US 
markets came in. 

Thereafter all eyes were fixed on 
the dollar and the Dow Jones Indus- 
trial Average, with debt products 
helping to sustain equities until just 
before the close of trading. 

Interest in the market’s second 
liners was much more subdued and 
the FT-SE Mid 250 Index could man- 
age only a 13.6 rise at 3,533.3. 

The demolition of Lbe Democrats 
in the US saw UK drugs stocks 
surge ahead, with analysts taking 
the view that capping of drugs 


prices as part of the US health care 
reforms proposed by the Clinton 
administration wonld be much 
harder to implement after the 
Republicans gained control of the 
two houses of Congress. 

Cable and Wireless was one of the 
Footsie's worst performers as the 
market showed its disappointment 
with the poor figures from the com- 
pany’s Mercury telecoms division. 

Bank shares attracted strong sup- 
port. especially NatWest, where the 
recent flow of ADRs, resulting from 
NatWest’s acquisition of Citizens 
Financial, and a major drag on the 
NatWest share price, was said to 
have dried up. 

Utilities suffered from the Labour 
Party's proposals for the imposition 
of a mixture of windfall taxation 
and a public dividend on the water 
and electricity companies. 


FT-SE-A All-Share index 



■ Key Indicators 
IntBces aid ratios 

FT-SE 100 3099.6 +35.8 

FT-SE Mid 250 3S33X +13.6 

FT-SE-A 350 1 553.6 +1 5 2 

FT-SE-A AB-Share 15S&63 +14-2! 

FT-SE-A All-Share yield 3-94 (397) 

Best performing sectors 

1 Tobaco +3-0 

2 PftannaceuMeafe +2.8 

3 Consumer Goods +1.7 

4 Gas Distribution +1.6 

5 Spirits, Wines & Oder +1.4 


Equity Shares Traded 


Timnw by volume (mWorJ. Exdudng; 
tntra-mmtal business m) overseas turnover 
1900 



1994 


FT Ordinary Index 23769 +2ai 

FT-SE-A Non Fins p/e 18.72 (18.61) 

FT-SE 1 00 Fut Dec 3116.0 +45.0 

10 yr Gift yfeid 6.70 (8.7 8) 

Long gflt/equity yld ratio: 293 (2.23) 

Worst performing sectors 

1 Water -1.6 

2 Healthcare-.... -0.7 

3 Household Goods -09 

4 Other Services & Bans _-0.4 

5 Extractive inds -0.2 


IIS poll 
boost for 
drugs 

Leading pharmaceuticals 
companies dominated the busi- 
ness in London as traders 
reacted enthusiastically to the 
political changes in the US and 
the consequent jump in the 
dollar. 

The Republican victories 
were perceived to have 
removed the threat to pricing 
and profits posed by the Clin- 
ton health care reforms. There 


was a rush of London buying 
and some dealers suggested 
that one heavy-hitting US 
mutual fund was also piling 
into the sector via the anony- 
minity of the inter-dealer bro- 
ker flDB system). 

However, analysts com- 
mented that the political 
moves were unlikely to have 
much impact on an industry 
which had already been forced 
to change. Managed care 
groups, which provide health 
care to around 55m Americans, 
have discovered their buying 
power over the past few years 
and forced prices down. Mr 
Paul Krfkler of US investment 
hank Goldman Sanhs «ariri- “It 
is clear that the political 


changes have given a senti- 
mental boost to the sector but, 
for the longer term, we would 
focus on the changes already 
in the market place.” 

Smiths line Beecham was 
the most heavily traded stock 
in the market with combined 
turnover in the “A” shares and 
Units hitting 18m. The “A”s 
rose 12 VS to 42] VSp and the 
Units li to 382p. Glaxo jumped 
19 VS to 617p on turnover of 15m 
shares, although 4m of those 

represented one side of a tax- 
related deal. Flsons, up 5 at 
121p and continuing to attract 
bid speculation, saw 8.7m 
shares dealt in the underlying 
market and was the most 
heavily traded stock option on 


the Lifle. Wellcome rose 20 to 
664p and Zeneca 14 to 871p. 

Utility worries 

Utility stocks moved against 
a strong market trend after Mr 
Gordon Brown, the shadow 
chancellor, stressed Labour 
party plans for a windfall tax 
on the privatised water and 
electricity companies. 

Norweb closed 4 lower at 
812p and Midlands Electricity 
surrendered 8 to 780p. York- 
shire Electricity eased 3 to 
740p, although Northern 
Ireland Electricity moved 
against the trend to close 6 
ahead at 375p on talk of a 
break-through in the frame- 


EQUITY FUTURES AND OPTIONS TRADING 


Stock index futures moved 
ahead strongly, leading the 
cash market for most of the 
session and racking up the 
best day’s trading volume for 


some weeks, writes Jeffrey 
Brown. 

Contract numbers powered 
ahead to 15,363 from 10,862 
on Tuesday, and with spread 


trading holding at nominal 
levels it was nearly all genuine 
two-way business. 

The FT-SE 100 December 
contract was 3,115 at the 
official 4.10pm dose, up 44 
points. The premium to cash 
equities was 14 points, with 
fair value premium running at 
around 7 points. 

Traders said the 
improvement in activity was 
the most stoking feature of the 
session, with much of the 
day’s buying pressure coming 
from US houses, notably 
Goldman Sachs. 

The contract lost some of its 
impetus in the final hour of 
trading, and the premium to 
cash equities, which had been 
20 points for much of the 
session and ixidsrpinning a 
reasonable level of arbitrage 
business, narrowed. 

The key to further upwards 
progress is dearly Watt Street, 
which showed signs of 
flaggging towards the end of 
the London day. in late, screen 
trading the December contract 
slipped below 3,100. 

Traded options activity 
jumped to 35,998 lots, from 
28,478 on Tuesday, with 
FT-SE and Euro FT-SE 
business coming to 15.854. 


TRADING VOLUME 


■ Major Stocks Yesterday 


ML CVntng Day's 
000 b tsCT tfaim 


A&OA &nupt 

1 XD 

4,100 

326 

ez\ 

IS 

AbbayNNUnrit 

MOO 

418 

<6 

Albart RbIhv 

i 500 

43 

*h 

Aftod Domacut 

•34 

601 

44 

Angfeai Wtds 

i/no 

624 

-ID 

SasL. 

473 

4.700 

2.100 

% 

270 

46 

a 

Awe. BrtL Faadri 

4 S 3 

553 

46 

A»oc.Br«.(tom 

6*6 

272 

-a 

BAAt 

2.900 

490 

«i 

BAT kKte.f 

7^00 

445 

+13 

BET 

1.600 

110*2 

♦1 

acc 

2,000 

351 


BOCf 

61 S 

706 

49 

BPf 

6.000 

424 

*7h 

ePBtoda. 

1300 

302 

46 

err 

8.100 

383 

46*2 

BTTTT 

IOjOOO 

305*2 

42 * 

Bm at ScodBidt 

300 

207 

42 

Bariayvf 

iDjxn 

568 

46 

Bant 

3.700 

5+8 

43 

BbaCMtef 

2 J 900 

202 

40 

Bodkw 

442 

411 

40 

Booort 

1^00 

516 

-4 

Bewaiwt 

1^00 

446 

46 

Bdt Aeroeparat 

778 

456 

43 

BritehAmayat 

4.700 

370 

46 

Brtarfi Gast 

bjoo 

297 

45 

atWiLnf 

67 + 

381 

-1 

Brtteh Sreatf 

0,000 

156 

4 Q *2 

Bored 

1200 

184 

43 

Bumah Caatiulf 

31 S 

871 

4 l 

Biran 

Z 600 

SI 

-2 

CariaS Wkat 

13,000 

-7 

Catfavy Seri— ppn»t 

4.000 

445 

+4 

CffiOo^ConviM.t 

2.600 

613 

27 » 

866 

•6 

46 

Coatelflyate 

fiUBOO 

194 

•2 

Comm. Ur+orrt 

2J6O0 

543 


CooJwon 

057 

349 

l! 

&»vtwidst 

1.400 

443 

42 

STbu vt 

614 

518 

423 

1001 

-1 

*6 

Ohona 

316 

189 

4*4 

EteMraBMLt 

494 

803 


East Mhteod Baa 

306 

702 

-2 

Oatuccompa 

157 

472 

4 l 

EngChnaCIm 

CntaipnaaOgt 

351 

IJOO 

354 

362 

40 

43 

Etsnunral Unfta 

441 

230 

46 

BQ 

923 

102 

45 

F*om 

6.700 

121 

♦5 

FOTtar 8 . CoL LT. 

457 

134 * 

41*1 


1.700 

220 

43 

Oan. Acddorrt 

467 

581 

-2 

OaranlBKlf 

2/100 

286 

43*1 

Gtasot 

15 X 00 

817 

* 19*1 

Gtyrreiad 

1 X 00 

344 

♦1 

Qrenadat 

520 

515 

42 

arendMat 

4 X 00 

417 

412 


1.100 

655 

-1 


2 X 00 

1 B 2 


OKNT 

1 X 00 

613 

*7 

Grinaast 

5,100 

468 

44 

HSBC I 73 p ah*t 

2 X 00 

725 

43*1 

Harnreenmn 

211 

>41 

4 l 

Hmaont 

9 X 00 

231*2 

44 *a 

ttertaona CnwIMd 

1 X 00 

106 


H»y 9 

032 

29 C 

♦1 

HBadown 

336 

173 

42 

M 

106 

330 

♦1 

ot 

5 X 00 

756*2 

-*2 

taatepot 

1.900 

442 

47 

JQriroon Matmoy 

409 

570 

42 

KncrtBriert 

2 X 00 

473 

40 

NMhSava 

422 

548 

-2 

LadMttt 

6,100 

153 

t 4 

Land Saortiast 

S 2 S 

616 

43 

Uparta 

235 

718 

40 

LagtadOanwart 

3.700 

4 W 

♦5 

Uoyds Abbay 
UowuBankt 

LASMO 

792 

2.700 

2 X 00 

343 

148 

-1 

-1 

♦*! 

London Baa 

1 Bi 

728 

-* 

Lonrbo 

3 X<» 

152*2 

♦1 

Lucas 

081 

196 

#T 

«EPC 1 

2.700 

412 

-3 

UR 

Z 700 

137 

44*1 

Uwnreb 

273 

020 

+2 

Marla & Spancart 

6.601 

401*2 

-a>2 

Midtands Baa 

872 

780 

-8 

Muntaon (W*v| 

1 J 0 OO 

134*1 

4*4 

MAC 

1.700 

'SO 

-1 

IteWeat Bankt 

2.900 

506*1 

♦ 8*4 

National POwart 

1,300 

463 

40 

Naxt 

1 X 00 

242 

44 

Nodi Htat Wau >7 

1 X 00 

548 

-6 

Northern Bad 

540 

814 

41 

Njjnham Fcortsl 

3 X 00 

2 P 4 

43*1 

Norwab 

38 

812 

-4 

Pamsont 

787 

619 

44 

P«Ot 

817 

643 

♦7 

FM*igt=«l 

1 X 00 

1 M 

-4 

Powa««nt 

PrudantUVf 

2 X 00 

8.500 

556 

320 

*1 

fwer 

020 

1002 

46 

RT 2 t 

2 X 00 

630 

-2 

Racri 

406 

245 

♦1 

Rank Orej-t 

RaddB S Cohnant 

M® 

556 

4 G 3 

571 

410 

-4 

Rriondt 

2.700 

461 

44 

Rood tnd.f 

1.100 

781 

40 

RanuWt 

Rmtoref ^ 

1.000 

3.100 

232 *j 

482 

* 2 *i 

46 

Rote Hflycot . 

4 jao 

177*1 

42*1 

RylBkScodww+ 

Rndtanwr 

1.700 

6 X 00 

1 X 00 

66 

450 

300 

419 

1363 

4« 

•2 

47 

*5 

Sa+ttdi S Nm.t 

687 

510 

41 

Scot Hydre-Soa. 

1,600 

332 

44 

Sedan Fewart 

2 X 00 

356 

♦1 

Saoiat _ 

3.800 

107*1 


SedgwW. 

1,900 

1 X 00 

148 

-1 

Sooboont 

434 


Severn Tranrf 

2 X 00 

558 

-h 

Snei Tronaportf 

3 X 00 

719 

40 

Sabot 

298 

548 

43 

Sn«bE>t» 

986 

225 

-2 

SmrhfWKI 

Smeti i Nephawt 

785 

1,100 

452 

144 

-5 

41*2 
♦1* » 

SmN Baacharet 

19 X 00 

423*1 

SmM Beechan Uts-t 

5 X 00 

382 

+11 

Snvtna indk 

183 

460 

41 

SojtenBWf 

1X00 

800 

-5 

Soutn MHao Sax 

2 SI 

610 

-3 

Sourer West Watvr 

34 

506 

-a 

Soutn Wbsl Baa 

434 

TOO 

+3 

EaAhrfn Watar 

381 

588 

-6 

Standard Churett 

3.000 

285 

|4 

Storehouse 

1.100 

218 



1.100 

33 S 

44 

TBN 

f.9V> 

220 

#2 

HGrewt 

1 X 00 

388 

♦3 

TSBt 

3.700 

£!7 

-1 

Tarmac 

7 X 00 

127 

44 

Toe aqite 

1 X 00 

429 

4 l 

Tayfcr Woodrow 

316 

133 

43 

Taacdf 

4 X 00 

342 

45 

Thamte Wafart 

2.100 

5(0 

-7 

Thorn a«t 

,'XOD 

1000 

417 

TorAmrf 

4100 

218 

41 

Trafalgar Horae 

527 

62 


Uogtfa 

UrSort 

1.700 

MOD 

360 

1134 

+2 

40 

UrndBaeriat 

3.700 

314 

tC 

UW. Nampvtaa 

1 X 00 

525 

46 


8.400 

211 

46 

WWWBlSGrt 

1 X 00 

8 * 

i 7 

WMcocnat 

2.700 

864 

*20 

Mdiwn 

S 05 

053 

-10 

Waaaoi Wtafar 

449 

303 

-12 

WMbnedt 

Z+OD 

363 


WBariQ HJdtP-t 

1 X 00 

340 

43 

VWa Canon 

268 

138 

-1 

Wmpey 

1 X 00 

141 

44 

Wotaateft 

tei 

776 

-6 

Yorkshire BecL 

494 

.'40 

-3 

VcrkNikr Wasr 

000 

524 

-18 

Tvaaf 

2 X 00 

871 

414 


Beset) on trstes tdire tor J Ktoctrei <4 
Warttoe dMb Bswgh « SEM *y*wn 

iMUriay kina ijffipm. Trades of rribn l* 
more are ramlM mm. t Mum on FT-SE 
iWntocnniMi 


■ FT-SE 100 INDEX FUTURES (U FEE) £2Sperfufl Mac poM 


(APT) 



Open 

Sett price 

CtMtige rtgb 

LOW 1 

EsL vol 

Open htt. 

Dec 

saaati 

3116.0 

+45.0 3136X1 

3085.0 

17090 

52783 

Mar 

3141 X 

3136X) 

+455 3141JJ 

3135.0 

40 

4252 

Jun 

- 

3196.0 

+45X1 

- 

0 

60 

■ FT-SE MmSSOMOEX FUTURES (LFFE) £10 per fufl Max poW 



Dec 

3650.0 

36000 

+36.0 35600 

3560JJ 

10 

4168 

■ FT-SE N 

D 280 ROBC RmjRES (OMJQ £10 per ftjfl Index paint 



Dec 

- 

3540.0 

. 

- 

- 

0 


I open IntBfoar (guw <*• far pmAua day. t Emct untune mown. 


■ FT-SE WO BPEX OPTION (UFFE) (*3101) CIO par fri index print 


2950 3000 3050 3100 

CPCPCPCP 
163*2 3*2 129*2 7 77 14*2 41 30 
189*3 22*2 151 34 114 48 B3>j 70 
218*2 43*2 56*2 1« 73 IK 93 


3150 3200 3290 3300 

CPCPCPCP 
18% 59 S*t 100 2*2 149 1 199 
98 95 38 128>2 25 163*2 14 205*2 
18 11512 88 144*2 47(2 17712 3412 216 


SB 82 138*2102*2 SB 126 87 155*2 6S*| 186*2 51*2 223 
188 137*i 118*2 181 87 251b 


MW 
Ok 

•to . _ 

Fob 235 51 MB 84 
Jurt MG 100 

cm 11,892 Mi <X» 

■ EURO STYLE FT-SE 100 WP6X QPHON QJFFE) RIO par M indaat pofcrt 

298B 2878 302S 3075 3125 3175 3225 SZ75 

Bn 188*2 2 141*2 5 97 10 58 21 28 41 11*2 7412 4 116*2 1>2 183*2 

Doc 309*2 19*2 188*2 28*2131*2 4198*2 5870*2 79*2 47*2 106 29 137*2 17 175 

Jm 230 32 185*2 45 156*z 59 129 7B Ml 100% 38 128 56% 156*2 49*2 191*2 

Mar 2SB 52*2 188 81*2 OVA ® 175 

Jurt 298 75*2 2 3ft 10B 174 144*2 125** 192 

ttfc 2M7 Mi SI * UM rt itoB W riuc. Praatoa team *• UW aw Hmreit prim, 
t Img Mud nd*y mh 

M EURO STYLE FT-SgMP 250 INDEX OPnOfifOMLX) El OpwOJtodgKpflfc* 


3400 


3450 


3800 3550 3600 

Oct lift 53*2 8B*« 75* 63*4 1021* 

Cab 0 tali 0 SoUmn prices and wtuac ara Wan at 4J0pn. 


3700 


3760 


Indices 


Day’s 

Nov 9 chgett Nov 8 Nov 7 Nov 4 


The UK Series 


Veer 

bio 


Dhr. Earn, 

ytetdtt ytoMtt 


P/E Xd ad. Total 
raflo ytd Return 


FT-SE 100 30M.6 

FT-SE Md 250 35333 

FT-SE MM 250 ok hw TVuato 3S335 

FT-SE-A 350 15S3L6 

FT-SE SmaSCap 1781.83 

FT-SE SmaOCap «t lav Thaata 1750.05 

FT-SE-A ALL-SHARE 1338.63 


+12 3063.8 3065.8 3097-8 3088-5 

+04 3519.7 3520.1 3534-8 34404 

+03 3521.7 36223 35343 3441.1 

+13 1638-4 1639-2 15523 1544.0 

+03 177834 1778.71 1781.73 1771.77 

+0.1 174835 1748.68 175030 175732 
+03 1624.42 1525.19 153835 152931 


■ FT-SE Actuaries All-Share 

Nov a 


Day's 

drflrtG 


Nov 8 Nov 7 Nov 4 


■HQ 


4.11 

335 

3.71 

3.98 

332 

332 

334 

ON. 

yWd* 


736 

530 

637 

6.78 

530 

5-56 

6.64 

Ean 

yfcUW 


18.75 11138 
2082 11331 
1939 117.70 
1738 54.71 
2534 50.82 
2238 52.8S 
17.92 53.48 


117832 

132035 

131832 

1206.19 

138730 

1387.15 

1215.07 


P/E Xd 34- Total 
ratio ytd Return 


10 >U«ERAL EXTRACTJONflfl? 
12 Extracttvs InduMeett) 

15 08, mtoya t ad(3) 

16 OB Exototatton a. Prodfll) 


271540 

+09 269090 2B8&66 2732.44 2472X0 

3^47 

6X4 

2S.11 

89X3 

100048 

3794X3 

-02 3802J1 37B1X4 3834.53 302320 

3X8 

041 

22X7 

9062 

1047.10 

2886X4 

+1.2 2682X8 2656.76 2709.76 2487X0 

3X1 

6X7 

22X4 

9044 

111015 

187087 

+02 1872X4 1878.88 1885X7 1888X0 

2X1 



t 3003 

1085.92 

1874. BO 

+08 1858.19 1666X6 1864.66 190310 

4X8 

6.13 

23X4 8024 

95024 

1060.10 

+1.1 1048X0 1043X0 1049X6 1138X0 

3.74 

028 

2469 36X3 

835X7 

1844X8 

+1.1 1824.85 181093 1834.77 1885.40 

4.0* 

5X7 

23.03 

8090 

873X9 

2277.46 

+0X 227010 227056 2302^47 2161X0 

4X7 

4X3 

27X0 

79X8 

1010.84 

178009 

+1.1 1770X6 1759.02 1703X1 1979.10 

5.12 

5.14 

23X6 

82.75 

920X9 

1882.00 

+07 1878X7 187044 1887.16 2088X0 

3X8 

063 

17X8 

81.88 

927.48 

' 180014 

+07 1793X0 1794X8 179073 1714X0 

017 

6X0 

2072 

53X9 

1096X4 

220096 

+07527017 2272X7 228044 1956X0 

4X8 

1X2 

BOXOf 92X4 

112000 

2902.04 

+OX 2780X8 2782X4 2792^43 238440 

3X8 

5X9 

21.70 

75.71 

1104X7 

1551X7 

+0X 1543X6 155030 166240 1915.60 

4X4 

097 

17X8 

81X9 

885X2 


20 OB* MANUFACTURER8(267) 

21 BuMns & Constoucttonfja* 

22 Bubftig Matte & Marctta{32) 

23 ChamfcstepB) 

24 EKvMtitad bMuaW8ta(MJ 

25 Electronic A Elect Equtof34) 

26 Enginewtig(71) 

27 EneMMring. va*doo(T3 

28 Printing, Paper & PckepS) 

29 TeadBes 3 Appbu+CZOI 


30 CONSUMER QOOOS<07) 2771.75 

31 arawwtesf17) 253937 

32 Spirit*. Wines & CUaradG 286036 

33 Food ManufactirasC23) 229958 

34 HouwhokJ Good803) 2 *®- 8B 

36 Heatth CareC21) IfSKf 

37 Pharmaceu0cate(19 

38 Tobaccofll 37 ^ /U - 


+1.7272438272336274937 272730 434 735 1531 10939 958.72 
+032232.42224433225931 200330 433 7.68 15.79 61 A3 100333 
+1.4 2819.70 280552 2842.12 257840 330 178 1733 10133 902.76 

+0X228047 2284X4 22BS.73 2282X0 434 7.83 15.14 88.47 971.71 

-0.6 238446 239833 841131 265930 338 736 16.62 89.98 958.16 

-0.7 159932 160536 101350 1664.70 3.18 330 4150 4834 92533 

+23 300037 2904.60 303534 3065.10 437 638 1657 12537 957.75 

+5.0 3824-08 361939 364038 419130 S.8I 931 11.68 21737 8S15S 


40 SBUnCES(»9) 

41 OtatrfbutoretM) 

42 Leisure 5 Hoteta(25) 

43 l4edtapS} 

44 netaSara. Food(1S) 

45 RetaBere. Genera«45) 

48 Survufi Servteaa(41) 

49 TtanapottflQ 
Setvtcaa 5 Bualnesa(7) 


51 

60 UTHJT®S(3G1 
62 Bectric5yfI7) 

64 Gas Dtatribreton® 

88 Tate o onw aav cMkmaW 
68 Wdcrfia 


190653 +0.7 189337 189632 190835 1857 40 

254533 +0.4 2838322531.68 2629.44 263350 

2050.49 +1.4 202135202132 2025.74 190240 

2854,72 +1.1 2823.77 284139 285593 260040 

1747.18 +1.4 172338 172236 1728.17 150030 

1804.74 -0.1 180534 181435 161942 168430 

1526.09 +0.7 161434 151132 1524.91 181850 

2252.79 +03 223539 22223S 2281.63 228520 

1245.19 -03 125521 125332 124537 1209.70 


027 

BX8 

1040 

52X0 

93031 

071 

7X1 

1041 

BSX5 

B3077 

038 

487 

24.19 

57.69 

1013.78 

2.43 

5X5 

22X0 

70X5 

99050 

075 

9.17 

13X9 

52X7 

104048 

033 

7.07 

17.89 

4020 

85091 

2.79 

wan 

1051 

35X2 

930X8 

078 

027 

1080 

81.02 

885.34 

4X8 

013 

4020 

2063 

1072.15 


242570 
355134 
1973X3 
2032.78 
1851 JB 


+03 241438 242538 244573244450 
+02 254551 286436256033211 130 
+13 164139 194138 183554211530 
+1.4 2004.16 202030 205587 230570 
-1.8 1IW9-S4 188949 192596 162520, 


4X5 

7. BO 

15X8 8097 

939.63 

059 

B.71 

12X9 8046 

1061.01 

007 

t 

t 117X6 

925.91 

4.06 

7.74 

1073 50X2 

860 B8 

5X0 

1019 

HX5 75X0 

92087 


89 NDN-HWAHCIAL8tB3 

70 HWWCttLSffOfl 

71 BerfaflO) 

73 hvuancettft 

74 UtoAaauanootR 

75 Merchant BantaJB) 

77 Other Hnandal(24} 

79 Prooertv(4i) _ 


X131M431 1645.18 TB5a7816»0« 332 342 JB.72 5&7P ri7&23 


218242 
2897.45 
1255-23 
238033 
2727.12 
1861.(71 
1 439^59 


+0.7 217733 218096 2201.54 229060 
+13288520287104 289085 2877.10 
+12 125235 123085 127438 144730 
+0.1 2378.07 238047 240015 2819.70 
+03271534 270048 272237 807830 

+1.1 184131 182529 1831.05 172160 
143B31 144507 146048 185040 . 

« 7717 17 2715.69 2737.04 2646.70_ 


4.41 

8XS 

1005 80.85 

872.64 

4.17 

9X0 

11.68 116X9 

871.14 

SX9 

9.40 

12.17 61X1 

886X4 

5X7 

7.83 

15X7 127X2 

921X1 

a at 

10X3 

11X0 87.78 

823A8 

3.74 

048 

14.11 64,85 

938X3 

4?3 „ 

4X0 

27X8 44.78 

82029 


80 MVESTMENT TWSt^iag 
89 FT-SE-A ALL-SHA ref B6 6) 

I. Hourly movements 


273638 


136 

564 


5136 5697 922-63 
1732 53.48 1215.07 


153833 +08 1524.42 1525.19 153505 152531 


830 1030 


t+tOT 1330 1430 1530 1510 Wdfly tov/day 

Jwt7 xa kz 00933 3111.B 31073 31093 3101.1 31123 30751 ~ 

307&1 So ^3 S535A 35353 35383 35312 35363 35223 

“■ ^4 S S S 165W 1S“» ’®- S I s54 ’ ,55U 

B ia « « ian_ Cte. twev.qgg. 


3901 991A 

90223 30263 
1884-7 18823 

29104 2913.1 


9923 

30333 

18753 



*084.4 10013 10023 10016 100M M043 1004.0 687^ +114 

3.7 30552 3087.1 30613 30573 30573 2071.9 -553 

Sai Si 15883 18083 1881.1 18601 1848.7 1880.7 -3T3 

JSS Sj 29583 29543 29553 20387 29333 28043 +293 

h. h+im b urn ka» LMs 0( oonaiteaBfc n «v^a ton nw Ftadd T»i*i 
Smtoe.-N* 0MlM ol teWBalo and cwaa«aaad 

iwaal 1864. 8T» TlrieB Mu 1B9+ fit notes moved 

*”!?J5??!^^T^h^MMTlwHn^Tla^lJ**48TliaFT-5EAtIiroaaW 


work for peace talks in North- 
ern Ireland. 

Among water shares, 
Thames retreated 7 to 503p and 
Anglia, which reported figures 
earlier this week, gave up 10 at 
524p. Southern was 8 lower at 
589p. while Northumbrian 
slipped 6 to 696p ahead of 
today's interim figures. 

Mr Nigel Hawkins at Hoare 
Govett said the reaction of the 
stocks to the speech “serves to 
remind investors of the politi- 
cal risks attached to utility 
stocks”. 

Commercial Union was 
restrained by market caution 
following third-quarter results. 
The profits of £3U5m were near 
the top of the range of fore- 
casts. but Credit Lyonnais 
T-aing said it showed that CU*s 
rate of improvement had 
slowed and some analysts 
argued that the 20 per cent pre- 
mium of the share price to net 
asset value was too high. The 
shares closed unchanged at 
543p, while Royal Insurance, 
reporting today, firmed 2 to 
30 Op and General Accident 
eased 2 to 58lp. 

Cable and Wireless shed 7 to 
392p in turnover of 12m as ana- 
lysts moved rapidly to down- 
grade profits forecasts follow- 
ing a disappointingly weak 
interim performance from the 
group's Mercury arm. 

The group as a whole turned 
in half-time growth of 11 per 
cent but Mercury, hit by price 
competition from BT and regu- 
latory pressure on revenues, 
saw operating profits slide 3 
per cent. NatWest Securities 
promptly chopped its annual 


NEW HIGHS AND 
LOWS FOR 1994 


NEW MOMS (23L 

BANKS re Bonce BSbo Verova BUtLQMB 4 
CNSnm tD VbqAn, DtSHVBUTORS (2) 
Ftocf Pnst finatet UxfcSmn, ELECTRNC 4 
ELECT EtXJP (4) Mammon Pmer. Tadpole Tech, 
TMPWX Thorpe IF.W), EXTRACTIVE MDS a 

Uedoea Umg. Gencsr. Gmu Cons. UK 
ASSURANCE (1) Liberty Lite Anoc of Atm. 
OTHER FINANCIAL (1) EOUxMpl Fund Men, 
OTHER SERVE 4 BUSKS (V Buum. 
PHARMACEUTICALS (1) Zaneco. PRTNCL 
PAPER A PACKS (1) Jervis (toner. RETAILERS, 
GENERAL {1) Goktsmato. SUPPORT 6ERV8 01 
Computer Paopte. TEXTILES A APPAREL fl) 
cnom txrtoe n Prvpps. TRANSPORT (1) Jacode 
04 WATS! tlj&xin SUftL AMERICANS fft 
Amdahl 

NEW LOWS P4- 

8ANKS « lAtsuhatv. Surmomo. BUUXNQ S 
CNSTRN a AxonStKi Bchnn, CtSMCALS 
(1> Cementane. EXSTtnBUTORS (S) teeteney 
Kotor. WitK Hmotem. Oeda. YASpec. 
MVBtSnED OWLS (1) hvaener a ELECTRNC 
A B-ECT EQUP fl| RoMXVD. EMHN6ERMa (t) 
Whatman. EWL VEMCLES {1} tn^wm, 
EXTRACTIVE ROB (Z) NSM. PMatnp, POOD 
MAMUF (S) 8anfca (Selney CL Bensons CtHpa. 
HEALTH CARE 0) AAK Aesoc Riming Sm. 
111. Labe. HOUSEHOLD 00008 (1) MfP ML 
INSURANCE HI Abtnat LLoyds Wta, CLM. 

Heath C£J. Uwnctee Lambert DWtSROfT 
TRUSTS |11) LEteURE 4 HOTELS N) AM* 
Avpottt, Barr & MM.T A . Quarfrart. Trtng. LJFE 
ASSURANCE (1) London & Mandw. MEDIA 
(1| BtoomAury. OIL EXPLORATION & PROD (1) 
Surge Energy. OTHER RNANCtAL (1> Inbwn 
Justtta. PHARMACEUTICALS fl) None NordWc 
a PftTNO. PAPER 4 PACKS B API bweresii. 
pnowrrr m REtasebr food ft) Saynt* 
RETAILERS, GBCRAL R Essen HaiMwe. Hue 
Art Devton. . Orlenw, Fff-vj. WEW. SPOUTS, 
WBCS A CDBS PQ Uaztnnr Cbrh, 

MenypoiML SUPPORT SOWS H Orosham 
Trlcooroputtog. J6A. Spargo, TEXTILES t 
APPAREL n Baud (Mil). Casio A*. taJerf. 
SECT, TRANSPORT (1) Vert. AAEKANS B 
BerNehem SlaeL Dm 4 Brodsveet. 

profits estimate for C&W by 
£90 m to £l.lbn, and anecdotal 
evidence suggests that some 
other houses took an even 
more cautious ling. 

BT. which unveils interims 
today, and Vodaphone were 
clear beneficiaries of some 
heavy switching out of C&W, 


with the former up 8!£ to 393p 
on 8.1m shares traded and 
Vodaphone gaming 6 at 211p. 

Shares in high street retailer 
Boots retreated 4 to 516p, with 
Smith New Court reported to 
have turned negative on the 
stock and been the day’s main 
seller of the stock. 

A story doing the rounds 
suggested that Boots had 
rejected an offer for Its phar- 
maceuticals division of 
DM2.5bn from BASF the Ger- 
man chemicals group, because 
it did not want the company to 
be relocated away from its Not- 
tingham headquarters. 

High street clearing bank 
Barclays moved up 9 to 598p as 
it confirmed that it was in 
negotiations with the New 
England bank Shawm ut 
National over the sale of its US 
subsidiary Barclays Business 
Credit. Press reports have 
suggested the sale could reap 
between $200m and 8400m. 

Furniture group MFI 
responded to a strong recom- 
mendation and upgrade from 
Morgan Stanley. The broker 
raised its current year profits 
forecast by £Sm to £97 m. 

Marks and Spencer stayed 
weak following Tuesday’s cau- 
tious comments Crum the com- 
pany surrounding the release 
of interim results. The shares 
eased 2 to 402p. 

Hopes of a shake-up in UK 
gaming laws, hinted at by the 
Home Secretary, led to demand 
for several stocks. Ladbroke, 
which publishes its third-quar- 
ter trading update 
today .finned 4 to 153p, and 
ltonk Organisation 10 to 403p. 


Also better on the same specu- 
lation was London Cluhs.up 8 
at 261p. 

The world's biggest glass- 
maker, PiUrington, fell 4 to 
188p with a sizeable line of 
stock said to be overhanging 
the market 

International trading con- 
glomerate Lonrfao had another 
hectic day, with 3.9m shares 
traded and the stock gaining a 
further penny at l52Vtp. 

Since the announced depar- 
ture of joint chief executive Mr 
Tiny Rowland, the shares have 
put on 15 per cent and some 
brokers now fee! uneasy with a 
prospective p/e ratio approach- 
ing 30. NatWest Securities is 
one of the more sanguine 
houses, estimating break-up 
net asset value at 175p. 

Amersham International fell 
63 to S28p as analysts reduced 
forecasts in the wake of disap- 
pointing interims. The range of 
full-year estimates came back 
to between £47 m and £50m. 

Campari International recov- 
ered 4 to 25p as it was 
announced that a company 
known as Blueridge Ltd had 
acquired almost 11 per cent of 
the leisure and sportswear 
group. Campari was trying to 
establish last night who was 
behind Blueridge and whether 
tiie stake had been acquired 
tor investment purposes or 
prior to a bid approach. 

MARKET REPORTERS: 

Peter John, 

Joel KBaazo, 

Jeffrey Brown. 

■ Other statistics. Page 25 


LONDON EQUITIES 


LtFFE EQUITY OPTIONS 





Cafc 



Puts 


Option 


Jan 

Apr 

M 

Jan 

Apr 

Jul 

MUDaaq 

600 

2D 

34 

41 

2114 

29 

40*4 

(-601 > 

650 

5V> 

16 

21 

57V, 

SIS 

72 

Arc* 

260 

13W 

2144 

28 

111* 

16)4 

2144 

F2M 1 

280 

6 

13 

1744 

23 

28 

33)4 

ASOA 

60 

6 

8 

9H 

2*4 

4 

S 

r«3 \ 

70 

2 

4 

544 

a** 

9W 

10*4 

Brtt Akinya 

360 

20V, 

33 : 

MV4 

13*4 

1944 

27 

rsesi 

390 

8 

1944 

29 

31 

38 

43)4 

SrilBdv* 

420 

18 

29 

38 

IB 

28 

3114 

(-421 1 

460 

SVr 

14 : 

20*4 

48 

51 

5544 

Boots 

WO 

2SVr 

39 

47 

11)4 

1714 

25 

C316 1 

550 

7 

1844 

at 

44 

46)4 

53 

BP 

420 

21 

30 : 

17*4 

12 

20 

24 )i 

("424 ) 

460 

sv> 

IS 

21 

37*4 

*3 

47 

Britt* SW 

140 

18*4 

23S! 

26V, 

2 

4 

6*4 

H56 J 

160 

6 

12 

16 

9*4 

12)4 

15 

Bass 

500 

52 

5644 

63 

6*4 

12*4 

18)4 

rwa i 

550 

16 

27 

36 

28*4 

35 

41)4 

Utelten 

MO 

21 

3244. 

« Vi 

17*4 

25 

31 

f393 » 

420 

9 

20 

28 

35*4 

42 

48)4 

Candida 

420 

32 

4344! 

504» 

10 

141* 

22 

T443 1 

460 

12 

23 : 

TOY, 

SOW 

3444 

43 

CcriTl UBUn 

5*3 

241+ 

32*4 

— 

19 

344, 

- 

C543 J 

592 

7 

14V, 

" 

52 

6T+ 

“ 

IQ 

750 

39V, 

61S 

81 

1944 

38 

47 

(-759 J 

BOO 

1514 

2844 

39 

40 

68 

76 

NngUra 

*00 

32V4 

44 r 

1844 

12H 

20 

2814 

r*73 1 

500 

Itto 

254+: 

»** 

32.** 

41 

50 

Land Saenr 

600 

27 

4044 

47 

lit* 

18*4 , 

27*4 

(-617 1 

650 

7 

la ; 

23*4 

43 

45*4 

57 

Marts & S 

390 

21 

31 

35 

8 

T3 

18 

r«2 1 

420 

7to 

1644! 

20 44 

24*4 

29!4 

34 

HalWwi 

500 

28 W 

38 V, 

40 

14)4 

3iw ; 

15*4 

(SOB 1 

550 

SV> 

18 

27 

46 

61'+ 1 

5F+ 

SanSxry 

MO 

34to 

47 

52 

6*4 

12 

18)4 

r*i9 1 

420 

1514 

2s ; 

544 

18 

25 

32 

Stri Irans. 

700 

36 

47 

54 

II 

3**4 : 

29)4 

(-718 i 

750 

10V+ 

2144 2944 

36)4 

51*4 : 

56*4 

Storehouse 

a* 

19Vi 

23 

Z7 

4 

6 

7*4 

(*£15 l 

220 

TV- 

12 1 

1644 

12*4 

14K 

16*4 

Trafalgar 

80 

6 

9 

11 

4 

6 

7)4 

C8Z 1 

90 

2V» 

9 

7 

10*4 

12 

13 

Lrterer 

1100 

»*+ 

76 8744 

17*4 

■ 

U*4 

(-11341 

1150 

28 

4844 6144 

40)4 

5814 1 

5BV. 

Zansca 

850 

48*4 

63 : 

r4to 

19 

38*4 

♦4 

(-571 > 

900 

24 

37V, 

50 

45 

63 

7D*» 

Opoon 


Nov 

Fab 1 

H*y 

NO* 

Ml ! 

ter 

Brand «a 

390 

2844 

37 

43 

l 

10 ‘4 

1444 

1*416 | 

420 

6 

19 2644 

10)4 

24 : 

M* 

LadbreM 

140 

14 

20 2344 

- 

3)4 

7 

T153 1 

160 

2 

944 ' 

13V, 

B 

12*4 

17 

Uffl Bbtams 

300 

16*4 

2644 

32 

1*4 

6)4 

15 

rji4 1 

330 

2 

1ZV, 

17 

17 ' 

21)4 

32 

Option 


Dec 

MW 

Jpn 

Dec 

Mar 

Jl*l 

Ffaons 

120 

8 

13M 1 

1744 

6>4 

1044 

I2M 

nzi ) 

130 

4 

944 1 

1344 

12>* 

16 

18 

Option 


No* 

Feb 1 

ter 

Nov 

Feb l 

ter 


Brt Aao 42D 37*» 64Vi 2VS 14 24 
C455 ) «0 10 a 44 15H 31 43» 

BAT Ms 420 27 41 48 1 9Vs 20W 

r*45 I 40 4 N 27 17*274 411* 

BTR 300 >Vi HN+ 255T 3 IQ 17 

ra * ) 330 to Tto 13 24 Z7to 35 

EH Tetttti 390 Bh 16H 25 4*4 IS* 19* 

rs3 I 4X a 6 I2H 2738 h 39 
CalliySBi 120 28* 37* 43* 1 6* 14* 

(*44S | 460 3 16 22* 17 94 35 

EaemBsc 800 17 43* 63M 19* «* 57 

raa3) 850 3 22* 42 5? 75 84* 

Gums 480 12 25* S3* 3* 11 21* 

r«7 I 500 * 9 IB* 12* 35 45 

SC »0 8 18 22* 2* 9* 12 

1*288 ) 300 * 7 13 14* 21 23 






Cafe 



PUIS 


Qpdon 


Hey 

Feb 

■ter 

•tor 

Feb 

«te 

Kansan 

220 

13 

17 

20 

*4 

5*4 

9)4 

C232 ) 

240 

Ito 

7 

1844 

B 

18 

20 

litsmr) 

134 

12 

— 

— 


- 

— 

ri45 1 

154 

2 

- 

- 

0 

- 

- 

Lucres fads 

180 

18V4 

24 

28*4 


3)4 

7 

ri88 j 

roo 

4 

12 

17 

5)4 

11)4 

15W 

P & 0 

600 

4SH 

61H 

714* 

1 

91* 

24 

(-6«3) 

650 

10 

31 

42 

14*4 

28)s 

47 

PBdngBn 

180 

9 

13)4 

18 

1 

514 

8«4 

(187) 

200 

14 

5 

9 

13 

1744 

20 

Prudential 

300 

21 

30)4 

34 

1 

6 

124 

r32D ) 

330 

2J» 

1344 

1744 

42 

19 

27)4 

BT2 

800 

42 

654* 

78 

2 

15 

30 

(-833 J 

850 

9 

3544 

48 

18)* 

3544 

53*4 

Hectare! 

460 

114s 

28)4 

36)4 

BV, 

19*4 

33 

r«z» 

500 

1 

12 

20 

37)4 

43 

58)4 

tnaca 

300 

8 

21*4 

27)4 

7 

17 

22V4 

ra») 

330 

1 

9*1 

16 

2flV* 

35)6 

41 

Testa 

240 

6V, 

15*4 

21 

3» 

10*4 

16 

r242 ) 

260 

- 

7 

12 

18 

22 

27)4 

\tadalotw 

200 

12*+ 

IB : 

25*4 

1 

7V, 

10)6 

(-211 ) 

217 

3 

1044 

- 

8 

15)4 

- 

•Warns 

326 

26 

— 

— 

1 

— 

- 

fX4S | 

354 

4)4 

- 

- 

10)6 

- 

- 

Option 


Jan 

Apr 

Jd 

Jan 

Apr 

Jfa 

BAA 

475 

31 

4244 

- 

6)4 

12 

_ 

(*498 ) 

500 

16H 

28 : 

3444 

16t* 

22*4 

28 

Hanes VWr 

500 

at : 

3744 

44 

1/ 

22*4: 

33*4 

rscc 1 

550 

BV+ 

18*4 

23 

SO 

53*4i 

5414 

Opaon 


Oee 

Iter 

Jure 

Dec 

liar 

Jut 

Abbey Had 

390 

st*» 

4244 • 

tS44 

3*4 

12)4 

17)4 

(*41> ) 

420 

13V, 

23)4! 

2944 

13*4 

26 

32 

Amatred 

25 

4V, 

5 

8 

*4 

1*4 

2 

rsa j 

30 

1h 

244 

3S4 

2*4 

4 

M 

Barclays 

550 

55)4 1 

B8*4 ‘ 

76)4 

3 

*3h : 

70*4 

rS98| 

600 

21*4 

37. 

1644 

18*t 

34 

42)4 

BU Ctete 

280 

20 

28 

34 

4*4 

914 

17 

ran s 

300 

9' 

1744! 

23*4 

13)4 

18*6 

27 

BrteC Cos 

280 

?i : 

28)4 

34 

2» 

7 

13 

r»i 

300 

8 

17 ! 

an 

944 

15 

23 

Dtxns 

180 

14*4 

19V, 

25 

4)» 

10 

13H 

(188 j 

200 

5 

1044 

15 

14*4 

21 

24 

fttfcdow 

160 

TS*4 

19 i 

22*4 

t<* 

4)4 

8)4 

an » 

180 

4 

8 

12 

10 

13 

19 

Lomu 

140 

18*4 

ia ; 

2444 

1*4 

6 

8 

1*152 ) 

160 

8*4 

9 

IS 

10*4 

16*4 

18 

Na3 Ptiaer 

460 

38 

49 1 

B0)4 

5 

13 

20 

r«2 i 

500 

12 St 

29 

30 

2))+ 

30 

39 

Sari Hmbt 

330 

34 

41 

49 

4 

11)4 

16 

C357 | 

360 

14)4 

23 ; 

0*4 

14)4 

2t 

30 

Sears 

100 

9)4 

12 

14 

1 

3 

5 

nerr I 

no 

3)* 

7 

8*4 

4W 

7)6 

10 

Forte 

220 

14 

20 

24 

4V* 

8 

13)4 

(*228 ) 

240 

4*4 

10 

14 

15 

18 

24 

Tarmac 

120 

11 

16 

19 

3)4 

614 

9)4 

ria 1 1 

130 

514 

11 

14 

8 

11*4' 

14)4 

Thom at 

1000 

29 • 

0*4 671* 

Z1 

39*4. 

17)4 

P00O) 

1050 

SVr ; 

25*4 44)4 

53 1 

B944 

7B 

TS8 

220 

14 

rev, 

23 

4 

11 

14 

(-228 1 

240 

4*4 

9 

14 

15 

22 25)4 

Tottttms 

200 

19 

24 

29 

2 

B 

a 

1-216 J 

220 

8*4 

13 

18 

8 

14)4 ■ 

17H 

Wefccme 

650 

36! 

57)4 

72 

48*4 

33. 

18)4 

F664 ) 

700 

1444 3444 

43 

46 

59 ; 

ra** 

Option 


J3I 

A|r 

■M 

Jan 

Apr 

JU 


Etna GOO 42 58* 70* 19 35 41* 

rei?) BO 19 33* 47 46 82*68* 

HS8C75pste 700 52 83 *!* 2D* 40* 53* 

1*725 ) 750 27 44 57* 44* 68 80* 

Reuters 460 38* 47* 55 9* 17* 23 

r*8Z ) 500 IS Z7 35 20* 38 

Option Mur Mi May Nw Fat Nay 

fkMo/ft >60 18 23* 26* - 3 6* 

H77 1 160 3 11* 15* 5* 11 15* 

- Undwlvtig wavoy prica. Pramk io etawn drt 


Nowtwi 9. Total contract* 35.782 Cater 6.673 
Puts. 2&079 


FT GOED MINES INDEX 


NOV 

8 

% dq 
on day 

Rev Rev Year 

7 4 ago 

sr 

52 amk 

H0I LBN 

2112X3 

W 

211152 212750 1968.18 

£06 

2367X0 1762X2 

344313 

-1.4 

349110 35(0 35 2656.60 

4X5 

371157 230445 

26t992 

-1J 

2697.17 271X90 2339,® 

158 

3013X9 2171.66 

1638.17 

♦13 

161655 1631.19 174606 

0X2 

2038.65 1468.11 


Gate Mnu tada (34} 

■ Regional btflaa 
Afrka (16i 
Austratass |7) 

North Amoriea |11) 

Copvnont. TTk- rnanc+l Titnas L*na«0 1994 

Ftgoros ri kntC+ete An rur+n c4 WiporMS. Bat* US Dctero. B» Vohios: 1Q004D 31/12/02. 
PMMM Gc*d Mnea Uvsw New 9 : 2B3i : -t»V^ change *3 6 puavs. Yen agw 2353 1 PirtoL 
Lawn proa we uuvaAaUe <o> the actual 


RISES AND FALLS YESTERDAY 




Meee 

Me 

S«pe 




1 

12 

12 

81 





















314 




20 





185 





Others 


5S 

21 

35 

Totals 


857 

335 

1383 


Dm BoMd on dioaa co mp wn l w Mad on dw London Share Samoa. 


TRADITIONAL OPTIONS 

First Darings Ngwambar 7 Exphy Fetxuaiy 9 

Last Deaflngs November 18 Settfement February 23 

Cans: Crossroads OH, Hsemoce>, Mlntnet, PMroceMe, Proteus, Reflex, Scoria 
HMb* Tac^olaTaeft, TUiow OS, Mfig^na. Puts; Crossroads OS, Rafleoc. Pits A CoOk 
(S axo, Tarmac, WeHcoma, Wigglna. 


LONDON RECENT ISSUES: EQUITIES 


taue And 
price paid 

P up 

Md. 

cap 

(Enx) 

1894 

High Low Stock 

Cktse 

pnee 

P 

+/- 

Net 

dto. 

ttv- 

COY. 

Gre 

P/E 

n* 

_ 

F.P. 

0X2 

6>a 

4 APTA Wmts. 

8 


- 

- 

- 

- 

- 

FJ». 

17X 

88 

70 Abtneft Udin Am 

88 


- 

- 


- 

- 

F P. 

reren 

63 

55 Do Warants 

65 


- 

- 

- 

- 

- 

F P. 

11X 

187 

180 rjAdara Pmtg 

188 


026% 

ai 

1-4 

10j9 

- 

F.P. 

101 

73 

63 Artesian Ests. 

75 


- 

- 

- 

- 

100 

F.P. 

178X 

93 

85 s ! BZW CommodMaa 

89 

-»2 

- 

- 

- 

- 

- 

F.P. 

104 

47 

39 Do. Wrts 

41 


- 

- 

— 

- 

- 

FJ>. 

46.9 

ae 

85 jCaDura 

87 

-1 

- 

- 

- 

- 

280 

FJ 3 . 

30X 

287 

280 Church# China 

285 


RN9.B6 

22 


13 A 

S3 

F.P. 

122 

88 

GS Emernix 

87 


RN0.71 

53 

12 

84 

- 

F.P. 

sax 

155 

108 FKrmtc CTek 

150 

+3 

RNO-76 

ZB 

06 

505 

115 

FJ*. 

36-3 

128 

115 Games Wbricshop 

117 

-1 

RWi 

22 


11-1 

_ 

FJ». 

1X1 

36 

23 Grtxp Dv Cap Wls 

23 


- 

- 

- 

- 

- 

FX. 

ms 

82 

57 Hambrae 5m Aslan 

57 


- 

- 

- 

- 

- 

FP. 

2.70 

30 

27 Do Warants 

27 


- 

- 

- 

- 

- 

FJ*. 

28X 

94 

90 M/ESOO Korea C 

94 


» 

- 

- 

- 

180 

FJ*. 

I66X 

223 

205 Mail Permanent 

218 


UN&O 

4.0 

04 

7.8 

- 

F.P. 

505 

493 

475 PrnSflc tec A/L 

488 


- 

- 

. 

- 

135 

F.P. 

583 

149 

136 SorvRair 

145 


RMX9 


3-3 

235 

- 

FJ*. 

0X8 

62 

57 Whtehm* 

62 


RM1^5 

ao 

25 

iao 


RIGHTS OFFERS 


Issue 

price 

P 

Amoutt 

paid 

up 

Latest 

Return. 

date 

IBM 

ttflh Low 

Stock 

Cioring 

price 

P 

*or- 

17 

Ni 

2/12 

2pm 

Vpm 

APTA Hete 

4»pm 


20 

Nl 

a/12 

4*2P to 

1pm 

Bum 

1pm 

->4 

310 

Ni 

20712 

41pm 

25pm 

Kenwood Appl 

26pm 

-6 

27 

M 

28/11 

3*2pm 

2 J 2pm 

Martin Ml 

3pm 


500 

M 

12/12 

50pm 

18pm 

Matthew dark 

18pm 


26 

M 

22/11 

Wwi 

i*pm 

Novo 

•*pm 


5 

Nil 

15711 

24pm 

)ipm 

rJrUraon Square 

ipm 



FINANCIAL TIMES EQUfTY INDICES 

Nov 8 Nov 8 Nov 7 Nov 4 Nov 3 

Yr ago 

*Wgh 

*lxw 

Onfieery Share 

2376.8 

2348X 

Z346X 

2371.7 

2377 J* 

2342 .7 

27T3X 

2240.6 

OnL dhr. yield 

4.35 

440 

4.40 

4X6 

4.34 

3.96 

4X1 

3.43 

Earn. yld. H U 

6X1 

6X9 

6X2 

6X8 

6X4 

4.62 

6X1 

3X2 

P/E moo net 

18X1 

18.10 

18X3 

1842# 

1846# 

27.12 

33.43 

18.94 

P/E ratio nil 

17X8 

17X5 

17.78 

17X8 

18X0 

25.16 

30X0 

17X9 


-ft* 1994. Onst arf 8Rara Max on comptedaic fttfi 2M&8 S/02/S4: low 49.4 26W40 
FT Orinay Share hdte ban (Ms 1/7/35. tCcrectad vliueB. 


Ordinary Shan hourly changes 

Open 9J0 IOjOO 11 JO iajD 13JOO 14J» 1600 18J0 

2355.2 2359C 2364.1 2364.1 2373.4 2383.8 23804 2381.7 2379J 2381.9 2355.0 



Nov 9 

Nov 8 

Nov 7 

Nov 4 

Nov 3 

Yrago 

SEAO baiQBftis 

26.798 

22X75 

21,785 

23X45 

23X26 

28.736 

Equity turnover {Emit 

- 

1072.1 

1063.7 

1063.9 

1795.6 

1721.1 

Eqwty berj^inst 

- 

24X13 

24X22 

27.889 

27X91 

32,756 

Shares traded Nit 

- 

557.5 

3988 

466.0 

622.4 

588.0 

Ttxefateg Wre-malmt budneas and dhoib orenora. 





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FINANCIAL TIMES THURSDAY NOVEMBER 10 1 *94 


LONDON SHARE SERVICE 


s 

m 

ZB 

B *1 

Ml *4 

m» t * 

n 

in 

« *3 

1M 

20 

n*j 

sm 

17 

ra 


MB 

& = 

zzt H 


24 110J) 27 

- Sit u 

xximax b.7 

U 99-1 1U 
08 470 5.1 
Ul BSJ U 
U 1789 119 

if : : life 

&Z 1396 4-8 
an 254.7 -.g 
OB 1907 202 

23 128 2 02 






tSJ 42.1 15.7 
4.110005 59 


U 1979 212 
-1005 172 


U 3445 1J0 
07 1215 40 


25 2201 170 
OLB 1225 115 


*2 333 05 


14.1 - - 

- 7047 205 

- 8B2 37 
14 1355 15 

*5 705 79 
128 - - 
0914075 305 
45 1415 -20 
12 1714 -4 
2.1 - - 
44 1529 -84 

02 1200 -14 

55 - - 

02 1129 -10 
*3 375 92 


MEDIA 


=as 




5JSB 


14 

320 

39 

HU 

09 


ZO 

179 

19 

329 

39 


28 

239 

ZjO 

53.4 

- 

8.4 

39 

429 

29 

00 

29 

109 

79 

4 

19 

219 

18 

23.7 

— 

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34 


FINANCIAL TIME 5 







































































































































Y 


FINANCIAL TIMES THURSDAY NOVEMBER 10 1994 


CURRENCIES AND MONEY 


MARKETS REPORT 


Dollar takes fresh heart from US election results 


The dollar yesterday rallied on 
the foreign exchanges as trad- 
ers took heart Cram the good 
showing by Republicans in the 
mid-term congressional elec- 
tions, writes Philip Gaurith. 

Analysts were split about the 
implications of the results for 
the dollar, but the market’s ini- 
tial reaction was to assume 
that the shift in power towards 
the Republicans favoured US 
financial assets and the cur- 
rency. 

The dollar finished in Lon- 
don at DML53, two pfennigs up 
on Tuesday's close of 
DML5Q97. Against the yen it 
finished at Y97.79, from 
Y97.0Q5. 

Sterling lost 1 % cents against 
the stronger dollar, to finish at 
$L6036, from $1.6184. It was 
stronger against the D-Mark, 
closing at DM2.4534, from 
DM3.4432. 


big turn In the dollar, predi- 
cated on changes to fiscal pol- 
icy, and a more aggressive Fed- 
eral Reserve, released from the 
perceived constraints of a Dem- 
ocratic presidency. 

Others were more cautious, 
but said the election was still 
part of an important conjunc- 
ture of events favouring the 
dollar. Mr Nell MacKinnon, 
chief economist at Citibank in 
London, said the combination 
of last week's Fed intervention 
to support the dollar, the elec- 
tion result, and further mone- 
tary tightening made him 
much more confident about the 
dollar's prospects. 

Having been hparish on the 
dollar for the past year, the 
Citibank analyst said he had 
now changed his view. “The 
downside for the dollar is 


■ Pound In Now York 


B Opinions diverged about 
whether, and why, the election 
results were important. Some 
saw them as the catalyst for a 


Nov 9 

— Latara — 

-Prev. dan 

Espat 

16070 

12195 

1 xfi 

1.6065 

12158 

3 raft 

12060 

12154 

lyr 

12989 

12080 


likely to be quite limited. I now 
believe the dollar goes up from 
here." 

Mr MacKinnon said: “The 
argument is based on the view 
that what is crucial for the 
prospects of the dollar is the 
relative attractiveness of US 
financial assets.” He saw this 
improving, on the basis of the 
Fed getting “ahead of the 
curve” in the battle against 
inflation, and this attracting 
financial flows back to the US. 

Although investor buying 
would probably only slow the 
capital outflow from the US, a 
long term bearish influence on 
the dollar. Mr MacKinnon said 
it could rise as for as DM1.67 
next year. This would be below 
the DM1.77 high it touched last 
February. 

Not all observers share this 
optimism. SG Warburg, for 
example, forecast the dollar at 
DM1 .35-45 at the end of 1995. 

Mr Steve Hannah, head of 
research at IBJ International, 
was more sceptical about the 
importance of the elections. He 


Dollar 


Against the Q-Mafk (DM per Sj 
1.53 - * — — #- 


1.52 


1.51 — 


1.50 - 



1.49’ 


2 November 1994 9 
SowmMmwii 


said the result might justify a 
“modest re-rating” of dollar 
assets. “I would be very scepti- 
cal, though, about calling this 
a change In trend in terms of 
the dollar's performance.” 

He said the election result 
had resolved an element of 
political uncertainty, but this 
had not been a significant 
cause of dollar weakness. 
“Monetary policy is a 90 per 


cent explanatory factor." said 

Mr Hannah. ' Unless the mar- 
ket feels comfortable about the 
Fed's policy stance, and the 
election result doesn’t alter 
that, then we haven’t really 
moved on." 

The IBJ analyst said the 
market price was probably 
exaggerating the influence of 
the elections. Yesterday’s move 
was a technical short squeeze, 
rather than a shift in trend. 
The latter would require 
aggressive Fed action - two 50 
basis point increases in US 
rates before the end of the year 
- and an indication that earlier 
tightenings were slowing the 
economy, thus curbing infla- 
tionary pressures. 


said: “ft is difficult to see the 
franc appreciating ahead of fhe 
election, even if the dollar 
stages a strong recovery." The 
catalyst for recent weakness 
was the entry into the cam- 
paign of Mr Jacques Chirac. He 
unnerved markets by saying 
French participation in Euro- 
pean monetary union should 
be put to a referendum. 


■ The French franc fell to 
FFr3.438/DM, from FFr3.436, its 
lowest level since December 
last year, with the early stages 
of next year's presidential cam- 
paign beginning to weigh on 
the currency. 

Mr Chis Turner, currency 
analyst at BZW in London, 


■ The Rank of England pro- 
vided UK money markets with 
£1.015bn of late assistance, and 
£i43m at established rates, 
after forecasting a £L3bn daily 
shortage. Three month LIBOR 
was at 6 % per cent Firmer gilt 
prices helped short sterling 
futures, with the December 
contract closing at 93.60 from 
93£S. 


■ OTHER CURRENCIES 




£ S 

HmgsV 174 £53 - 1748E9 103840 - WBJWO 
SM 382400 - 2327.00 174380 - 1ZSOOO 

CL 4736 - 14736 CL233S - 02990 
37498 3 - 375633 233900 -234200 
195030 - 495870 3087.00 - 309MB 
52903 -19021 16715 - 39735 


hum 

Mori 

Rissa 

UAL 



1 POUND SPOT 

“Of 

-.WARD AGAINST TH£ POUND : ; :dj 


- DOLLAR SPOT FORWARD AGAINST THE DOLLAR! 


Nov 8 


Closing Change Bfctfotfer 
mfct-poinj on day spread 


Dev's Met 
high low 


On* month Three months One year Bank of 
Rata *PA Rata %PA Rata %PA Eng. Index 


Nov 9 


Closing 

mld-poirrt 


Chengs Kd/ofter 
on day 


Day's mid 
high low 


One month Three months One y ear JLP Mor^n 
Rate %PA Rate “6 PA Rate %PA index - 


Europe 

Austria 

Belgium 

Denmark 

Finland 

France 

Germany 

Greece 

Ireland 

tody 

Luxembourg 

Nethertands 

Norway 

Ftortugal 


fSch) 17.2622 +0.0724 544-700 17.2883 17.1808 172579 02 17248 0-4 


(BFrJ 50.4790 +43.1621 367-229 505580 50.1960 504496 07 502798 08 502388 


82151 

72271 


(DK«) 

FM) 

(Fft) 

(DM) 

(Dr) 377257 
12173 


TO 


+00382 107 - 194 
-00129 174-367 
8.4335 +0.0405 288-331 

24634 +00102 521 - 546 

+■1274 714 - 200 378210 378.883 

+0.0029 185 - 180 12186 1.0138 

+044 831 - 181 


9.8258 92548 
72470 72150 
8.4446 82830 
2.4570 2.4397 


9.6126 02 92274 -02 9.6088 


05 

0.1 


04313 

2.4517 


02 

02 


8.4238 

2.4478 


02 

02 


82555 

24184 


0.9 

12 


1154 

117.1 

117.0 

88.7 

1092 

1204 


(U 2520.08 


12171 02 12187 02 12188 -Ol 

2523.75 2S0822 252528 -2.7 2537.06 -2.7 2587.58 -2.7 


(LFr) 504798 +01621 387 - 229 506580 501980 50.4488 07 503798 08 502398 


(F9 2.7490 +00097 476 - 604 2.7542 27338 27476 06 27432 02 27087 


PM) 10.7188 +02478 142 ■ 228 10.7326 102564 10.7188 02 107203 -Ol 107132 


(Es) 250255 
(Pta) 204493 


05 

12 

OO 


iSF»J 

« 


- 0918772 


Sweden 
Sutherland 
UK 
Ecu 
SORT 
Americas 
Argentina 
Brazfl 
Canada 

Mexico (New Peso) 

USA [S] 1.8038 

PacBfe/MMdle EaatfAfirtce 


+124 420 - 090 250282 249403 252285 -03 255.455 -72 
♦0.85 408-577 204.700 202254 204.823 -1.9 208.678 -10.1 206.103 -12 


1052 

742 

117.1 
1210 

86.1 


Europe 

Austria 

Belgium 

Denmark 

Finland 

France 

Germany 

Greece 

Ireland 

Italy 

Luxembourg 


85.8 


(Peso) 

(HQ 

(CS) 


21891 


Australia 
Hong Kong 
tnefia 
Japan 
Malaysia 
New Zealand 


(AS) 21221 


(Y) 158212 
(MS) 


(NZS) 


Saudi Arabia (SR) 

Stagapore (St) 

S Africa (Com] (R) 

S Africa (Fin] (R) 

South Korea (Won) 1277.79 
Taiwan 
Thailand 


+0 0042 

854 ■ 058 

112480 11.7394 

112146 

-12 

112571 

-21 

120016 

-1.7 

752 

+00135 

529 - 554 

22567 

20403 

20511 

12 

22436 

21 

20013 

26 

1221 

- 

- 

- 

- 

- 

- 

- 

- 

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- 

802 

+0.0046 

892 - 908 

1.2609 

1-2828 

12899 

0.0 

129 

0.0 

12844 

54 

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013 - 021 

1.6228 

1.6009 








-0.0123 

307 - 328 

12458 

12276 

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682 - 699 

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21680 

21677 

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21887 

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2.166 

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910 - 992 

52537 

54607 

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12024 

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2.1568 

21105 

21242 

-12 

2127 

-02 

21409 

-59 


-Q.1154 

895- 965 

125458 122780 

12384 

02 

123797 

54 

123345 

02 


-0A625 

645 - 026 

50.9870 503270 

- 

. 

. 

. 

. 

. 

_ 

-0-1B1 

897 - 928 

157.710 158290 

155352 

32 

155337 

32 

160.152 

42 

1951 

-0.0358 

018-052 

4.1494 

4.0998 

- 

■ 

. 

. 

. 

. 

_ 

-0.0301 

734 - 765 

26080 

25677 

25797 

-22 

22869 

-22 

26088 

-12 

_ 

-0.1894 

355 - 124 

38.0200 37.8350 

- 

. 

. 


. 


_ 

-00558 

128 - 159 

82886 

6-0069 

. 

. 

. 

- 

. 

. 

_ 

—0.0175 

522 - 548 

23783 

23517 

. 

. 

. 

- 

. 

. 

_ 

-0.0238 

312 - 361 

6.6795 

56237 

- 

- 

• 

. 

. 

. 

- 


Norway 

Portugal 

Spain 

Sweden 

Switzerland 

UK 

Ecu 

SO Fit 


(Sch) 

(BFr) 

(DKi) 

(FM) 

(FFr) 

P) 

(Pi) 

90 
W 
(LFr) 
0=9 
(NKr) 
<Bs) 
Pta ) 
(SKr) 
(SFr) 
» 


Argentina 
Brazfl 
Ccroda 

Mexico (New Peso) 

USA <$) 

PadflefMddle East/ Africa 


(CO 


(AS) 

9*S> 


IMS) 


6 5103 84880 
1293.88 127624 


64884 -0.0198 689 - 038 
-1X13 743 -815 
(IS) 41.7962 -02874 650-073 422123 41.7447 
(BtJ 400186 -0314 918 - 414 404800 392890 


Auetrala 
Hong Kong 
Intfia 
Japan 
Malaysia 
New Zealand (NZS) 
PlAppines I 
Saudi Araba 
Singapore 
S Africa (Com) 

S Africa (FVl) 

South Korea 
Taiwan 
Thaftnd 


(SR) 

(SS) 
(H) 


157660 

+51435 

625 - 675 

10.7675 

10.6000 

10.766 

Oil 

10.7B48 

0.0 

10.69 

0.7 

104.S 

31.4800 

-+0289 

600 - 000 

31.5250 30.9800 

31.4825 

-0.1 

31.44 

05 

3154 

04 

. 106-1 

52961 

+0.0788 

947 • 975 

6 0045 

53332 

6.0001 

-08 

6.0C86 

-02 

6.0471 

-09 

1055 

42940 

+0.0351 

890 - 990 

4.7051 

4.6381 

4.6947 

-02 

4.6915 

02 

4.688 

ai 

82.9 

52693 

+0.0733 

575 - 610 

5.2875 

5.1700 

52808 

-0.3 

52582 

0.1 

5246 

05 

1085 

12300 

+50203 

295 - 304 

1.5323 

15043 

1.5296 

03 

15275 

0.6 

15147 

1.0 

107.4 

235.700 

+2.95 

BOO - 800 

238.000 232 900 

235.97 

-1.4 

236525 

-1.4 

238.775 

-15 

6845 

1.5764 

-0219 

755 - 772 

1.6004 

1.5740 

1-5763 

00 

15765 

0.0 

1.5634 

05 

- 

157125 

+2025 

080 - 330 

1674.60 1547.00 

1575.8 

-3.2 

1583.55 

-3.1 

182455 

-35 

745 

31.4800 

+0.389 

600 ■ 000 

315250 309800 

31.4825 

-0.1 

31.44 

05 

31.34 

0.4 

106.1 

1.7143 

+02217 

738 ■ 148 

1.7185 

T 6665 

1.7143 

a.o 

1.7124 

05 

1.7008 

05 

1009 

56843 

+0.0908 

830 - 855 

6J915 

8 5705 

6.6871 

-0.5 

6.6938 

-09 

6.7318 

-0.7 

965 

158250 

+22 

200 - 300 

156-520 

154.200 

156.875 

-4.B 

158 

-<5 

1625 

-4.0 

95.4 

127225 

+1.695 

S00 - 550 

127.750 125.420 

127.855 

-3.1 

12852 

-3.1 

131 .t3S 

-25 

80.9 

72560 

+02702 

512 - 607 

7.3808 

7.2510 

73708 

-2.4 

7.4 

-2.4 

754 

-25 

80.7 

12810 

+50201 

805 - 815 

1-2845 

12575 

12798 

12 

12757 

1.7 

12568 

19 

1085 

1.6036 

-50148 

032 - 039 

1 6234 

1.6015 

1.6029 

05 

1 6024 

05 

1.9951 

05 

no f> 

12432 

-50159 

428 ■ <38 

12635 

12420 

12427 

05 

12426 

02 

12422 

0.1 

- 

1.46446 

- 

- 

- 

- 

• 

" 

" 

* 

# 

" 

- 

59989 

-0.0004 

988 - 980 

0.9995 

0.9985 

- 


- 

- 

- 

- 

- 

0.8305 

- 

300 - 310 

0.8310 

0.8290 

- 

- 

- 

- 

• 

- 

- 

12527 

-50042 

524 - 529 

1 3563 

1.3516 

1.3524 

02 

15521 

02 

15577 

-0.4 

832 

3.4266 

+50025 

250 ■ 280 

3.4290 

3.4240 

3.4275 

-0.4 

3.4233 

-05 

14307 

-05 

- 




- 

. 

- 

- 

- 

- 

- 

- 

945 

klrica 












1.3234 

-02042 

229 - 238 

1.3298 

13167 

I 3237 

-02 

15244 

-05 

15317 

-0.6 

869 

7.7285 

-50004 

230 - 290 

7.7290 

7.7280 

7.7266 

05 

7.7261 

0.1 

7.734 

-0.1 

- 

31.4200 

+0.0025 

150 - 250 

31 4250 31.4125 

31505 

-32 

31.65 

-29 

- 

- 

- 

97.7900 

+0.765 

400 - 400 

98.0200 96.6500 

97.55 

2 3 

9694 

35 

94.145 

37 

151.1 

25590 

+02016 

ses - 695 

25805 

2.5550 

2.5498 

45 

3 RtflR 

32 

2612 

-2.1 

- 

1.6056 

-0.0039 

051 - 064 

1.6088 

1 6003 

1.6068 

-a 7 

1.6086 

-07 

1.6139 

-05 

- 

23.6500 

+0.1 

000 - 000 

23.8000 234000 

- 

- 

- 

- 

- 

- 

- 

3.7507 

-0.0001 

505 - 506 

3.7510 

3.7505 

3.752 

-0.4 

3.7581 

-0.6 

3.7747 

-OB 

- 

1.4677 

+0.0027 

672 - 662 

1.4687 

1.4648 

1.4854 

15 

1.4606 

19 

1.4432 

1.7 

- 

3.5133 

+0.0175 

125 - 140 

3.51 SO 

3.4977 

35279 

-5,0 

35595 

-55 

3.7186 

-6.8 

- 

4.0450 

+0 025 

350 - 550 

4.0590 

4.0200 

4.0675 

-6.7 

4.115 

-6.9 

455 

-75 

- 

796.850 

-0.8 

800 - BOO 

797.500 796.700 

799.85 

-45 

80355 

-33 

82185 

-31 

- 

262648 

-0.0002 

635 - 660 

26.0700 28.0570 

26.0848 

-05 

26.1248 

-09 

- 

- 

- 

24.9550 

+0235 

450 - 650 

24 9700 243200 

25.0275 

-35 

25.155 

-32 

25535 

-2.7 

- 


180R rales lor Nov 9. EBdtoBra spreads in tho Poratd Spot ttote show arly tbs loot three decimal ptacm. Fonrard rates are not dracOy taiotod to 
but sra li ru le d by wm Merest rates. Started index cateutewd by the Braikof Enobnl Bees rraregs 1985 a tOQJSd. Oflsr and Hbt trass hi be 
Bra Daft* Spat tsUss delved tan THE WMfREUTERS CU3SMG SPOT RATES. Same ttekiea are nwxted by Bis F.T. 


fnxfcst 
bodi did and 


fSDR rate ire No* B. Hdtottor i . 
but are impisd by current terasnit i 


’ Spat crate show arty Sra lera Svee decnal pieces Forward ns are ■ 
I & ECU rae quoted in US cwrency. XP. Morgrar nomhra micas Nov 7. E 


: dree?/ q u oad to the 

i 1390. TOO 


Novembers 


Belgium 
we* ago 

France 

week ago 
Germany 
week ago 
Ireland 
week ago 
Italy 

week ago 

Nethortonda 


Switzerland 
week ago 
US 

week ago 
Japan 
week ago 


SS 

ES 

Owr 

night 


LTES 

m 

9x 

mto. 

One'.Lomb. 
.W. Inter. 

m 

Ota. 

-IBM' 

HE 

Repo 

rate 

4Ti 

43 

S* 

SYi 

6J- 7 AST 


- 


43 

5V. 

Bi 

.84 7M3 ■ 

450 

- 

55 

fii 

m 

W 

ej 950 


825 

5A 

Si 

5% 

59 

•.8ft -550' 

’ — 

8.75 

4.93 

4.85 

615 

528 

590. 6,00 

490; 

495 

453 

495 

5.15 

823 

880 850. 

490 

495 

Si 

514 

5* 

U 

Ti 

' . 

825 

$ra 

SK 

Si 

6H 

:7W '■ • - 

a. 

826 

8M 

854 

8* 

fii 

.-■S'.'-'. - 

790 

820 

8V4 

8W 

ffK . 

9K 

70)4 

790 

.820 

454 

5.05 

524 

558 

5.76 - . _ 

S25 


4.84 

555 

523 

858 

5i78 ' 

526 - 

- 

3% 

33 

4 

4M 

41# K82S 

390 

— 

33 

33 

4i 

44 

4% 8-628 - 

,390 

• - 

43 

616 

6V 

«i 

68 — 

450 

— 

4* 

5S6 

5tt 

39 

. Bft , ■ 

490.- 

- 

2» 

216 

21 

2k 


1.75- 

— 

Zi 

216 

21 

24 - 

2*. - : 

1.75 • 

- 


I* 




■ SUBOR FT London 
Intcrbenk Fbdng 
week ago 
US Debar CD* 
week ago 
SOR United De 

week ago 

BCU LMrad Qs mid raise: 1 rnttc fflfc 3 nebs: B3j 
rates are ottered raws lor Sltt n y *ad * 
do*. The bartra am Bonksre That, Bra* * Tajraa 
Ud ate steam tor Ora doarasdc Money nates. 


5ft 

53 

6H 

8ft 


"• 

■ . ^ 

.-r. 

5ft 

58 

8 

...8% - 



. - 


6.18 

590 

598 

848 



• >• 

j 

5.16 

527 

S.74 

'841* 

■ - 


- ■ 


3ta 

3S 

3* 

4 • 



- 


3K 

3ft 

3* 

4 

" r : 

. : . • ■ 


i! 


8 rrahra ei: i year. m. t UBOR Intratanh era* 
M by lotr re tawica bra* s at Itam osah eodrina 
Bartteye and MAta W s tararatra- 
US s COS and son u*w Ovate M- 


EURO CURRENCY INTEREST RATES 

Nov 8 Short 7 days One TTwa 

term notice month 


One 


months months . year 


Sft 
5 
5 

5 ft 

ah 

7ft 
511 
3ft 
4ft 
4ft 
9' 

2ft 
ih 

Shat toon raws rae csi 

■ THREE MONTH 


Belgian Franc 
Drarish Krona 
D-Mark 
Dutch Glider 
French Franc 
Portuguese Esc. 
Sperteh Peseta 
Storing 
Swiss Franc 
Car. DoBar 
US Deter 
Man Lira 
Yen 




Ah 
4 h 


-4ft 

7h 


4B 

-4« 

5 - 

4ft 

5ft 

-5ft 

5ft- 

5ft 

Bft - 

6ft 

6% 

- 5ft 

6ft- 

5ft 

Bft 

-8ft 

7 - 

8ft 

7 5’ 

7ft 

5- 

4ft 

5 - 

«ft 

5ft 

-6J, 

5ft- 

5ft 

5fl- 

5ft 

5i 

-4fl 

5& 

- 5 

Sft 

■Sft 

8ft. 

5ft 

5ft- 

5ft 

5£ 

-5& 

Sue - 

5A 

5ft 

-5ft 

5% ■ 

5ft. 

8ft- 

6ft 

8ft 

-8 h 

9ft 

-9 

10 

•9ft 

10ft 

-10 

-10ft- 

10ft 

7ft 

-7ft 

7ft- 

7ft 

73 

-7il 

8ft- 

8ft 

9ft 

-9 

5U 

-6fl 

5li - 

si 

Sft 

- 8 

Bft- 

eft 

73- 

7ft 

&2 

-3ft 

oil - 

34 

4 - 

3ft 

4ft 

-A . 

4ft - 

4ft 

5 it 

-4ft 

54- 

5 A 

5ft 

- Sft 

Sft - 

Bft 

7ft 

-7 

5ft 

-5 

5A- 

5A 

6fi 

-5ft 

Sft 

- 6 

8ft- 

eft 

8ft 

-8ft 

8ft- 

8ft 

8ft 

-B^z 

9ft- 

93 

10- 

9% 

2\ 

-2ft 

2A - 

2ft 

2ti 

-2tt 

2fi- 

2B 


2*3 

3 it 

-2U 

3ft- 

3ft 

3ft 

-3ft 

3ft- 

3ft 

4ft 

-4 


tor the US DoBar 


and Yen. adwoc 
(MAT1F) Parts 


two dm** nonce, 
interbank offered rate 



Open 

Sett pries 

Change 

rtgh 

Low 

EbL wi 

Opan.kn 


Dec 

9427 

9427 

+0.01 

9429 

9426 

13.797 

51743 

£■• /• 

Mar 

9391 

9393 

+092 

9394 

9391 

14989 



83.40 

93.42 

+093 

93.44 

83.40 

6981 

29909 

Sep 

33.04 

8398 

+095 

9399 

93.04 

4,713 

21907 


D THRO 

MONTH RURODOUJUI (UFFQ* Sim points af 100% 





Open 

Sett price 

Change 

Hgh 

Low 

EsL voi 

Open bri. 


Dae 


9395 

+0.04 

- 

- 

0 

2485 

'_J 

Mar 

. 

33.47 

+0.07 

ra 

- 

0 

1388 


Jun 

. 

9298 

+096 

- 

- 

0 

354 


Sep 

- 

9291 

+097 

- 

- 

0 

81 



■ THREE MOUTH HUWOUHKWWWEflJffE^ DMIm pokrta of 10096 



Open 

Sett price 

Change 

High 

Low 

EBL wfl 

Open M. 

Dec 

8493 

9494 

+0.03 

8494 

9492 

17251 

147330 

Mar 

9490 

9497 

+0L03 

0428 

9455 

27778 

181111 

Jwi 

9420 

9423 

+098 

9425 

9418 

24583 

114329 

Sap 

93.80 

9395 

+096 

9397 

83.79 

10783 

79214 

■ TORES 

MONTH NUIIOUWt WTJMTH FUTURBS (UFFQ LlOOOm paints of 10096 


Open 

Sett price 

Chstge 

High 

Low 

Est vcf 

Open bit 

Dec 

91.00 

81.14 

+0.13 

91.18 

91.00 

6407 

33487 

Mar 

9098 

9091 . 

+0.16 

9092 

9028 

5051 

32792 

Jun 

8991 

8994 

+0.18 

8996 

8891 

1277 

16481 

Sep 

8991 

8999 

+0.17 

89+48 

8M1 

837 

21412 

■ THUMB 

MONTH BURO SWISS FRMW IVTUMEB (LFFQ SFrlm pokitB aM 0096 


Open 

Sett price 

Change 

HKP 

Low 

Eat. vd 

Open fnt. 

Dec 

yw 

9593 


8595 

9592 

1761 

20011 

Mar 

9597 

9598 

+092 

96.89 

9683 

2562 

19232 

Jun 

9529 

9521 

+097 

9523 

9529 

389 

4902 

Sep 

95.00 

9497 

+097 

9590 

9497 

177 

2112 

■ THREE MONTH ECU FUTURES (LIFFQ Eculm potato of 100% 



Open 

Sett price 

Change 

Hgh 

Low 

EK vol 

Open krt. 

Dec 

9393 

9397 

+093 

9398 

..'9393 

1778 

8236 

Mar 

9390 

mss 

+008 

9396 

9390 

588 

7297 

Jun 

9298 

9398 

+0.09 

on nil - 

9298 

438 

4126 

Sep 

9290 

9297 

+009 

9297 

8290 

224 

2360 


■ UFTE Muss trwted on ART 


CROSS RATES AND DERIVATIVES 


EXCHANGE CROSS RATES 

Nov B BFr DKr FFr 

DM 

IE 

L 

n 

NKr 

Ea 

Pta 

SKr 

SR 

C 

CS 

$ 

Y 

Ecu 

Belgium 

(BFr) 

100 

1805 

1871 

4858 

2015 

4992 

5.446 

2124 

496.4 

405.1 

2398 

4068 

1981 

4297 

3.177 

3186 

2555 

Denmark 

PKr) 

52.50 

10 

8772 

2951 

1958 

2821 

2958 

11.15 

2609 

212.7 

1227 

2136 

1940 

22S8 

1568 

1831 

1942 

Ranee 

(FFr) 

5995 

11.40 

10 

2.908 

1208 

2888 

3258 

1271 

297.1 

2429 

13.99 

2435 

1.188 

2572 

1902 

185.9 

1.530 

Gannrany 

(DM) 

2098 

3920 

8438 

1 

8415 

1027 

1.121 

4370 

1022 

8397 

4510 

0937 

8408 

0984 

0964 

0392 

0528 

Ireland 

(K) 

4994 

9.454 

8293 

2412 

1 

2478 

2703 

1094 

240.4 

201.1 

1190 

2020 

0983 

2133 

1577 

1542 

1268 

Italy 

u 

2903 

0982 

0935 

8097 

8040 

108 

aios 

0.425 

9944 

8115 

8468 

8082 

0940 

0988 

0984 

Rgpg 

0951 

Nethertands 

PI 

1896 

3.498 

3968 

0992 

8370 

916.7 

1 

3900 

91.16 

7438 

4292 

8747 

0984 

8789 

0583 

5794 

cues 

Norway 

(NK) 

4799 

8969 

7968 

2288 

8949 

2351 

2564 

10 

233.6 

1809 

1191 

1.918 

0933 

2923 

1.496 

1489 

1203 

Portugal 


20.14 

3937 

3968 

8979 

8406 

1006 

1987 

4278 

108 

81.80 

4709 

0920 

0989 

8866 

0.640 

8257 

051S 

Spain 

(Pta) 

2498 

4.702 

4124 

1200 

8487 

1232 

1944 

5242 

1225 

100. 

5-770 

1.004 

8489 

1.081 

8784 

7887 

0931 

Sweden 

tSKr) 

42.78 

8148 

7.147 

2079 

0962 

2136 

2930 

9985 

2124 

1739 

10 

1.741 

0947 

1938 

1969 

1329 

1993 

Switzerland 

(SR) 

2458 

4981 

4.106 

1.194 

8485 

1227 

1938 

6219 

1220 

9956 

8746 

1 

8487 

1956 

0.781 

7894 

8628 

UK 

(Q 

50.48 

8816 

8434 

2X53 

1917 

2520 

2749 

1872 

2609 

2045 

1190 

2054 

1 

2169 

1504 

1569 

1290 

Canada 

(CSJ 

2397 

4433 

3988 

1.131 

8489 

1162 

1287 

4842 

116.5 

9428 

8440 

8947 

8481 

1 

0.740 

7229 

0595 

US 

» 

31.47 

5994 

8258 

1929 

8634 

1571 

1.714 

8983 

1562 

1279 

7957 

1281 

0923 

1962 

1 

97.78 

8804 

■M»n 

PO 

32.19 

6.132 

5979 

1964 

0948 

1807 

1-753 

6937 

1589 

1384 

7528 

1910 

0938 

1983 

1.023 

108 

0923 

Ecu 


39.13 

7.453 

8538 

1902 

8788 

1853 

2131 

8910 

1943 

1585 

8147 

1982 

8775 

1981 

1243 

1219 

1 



Margined Foreign Exchange 
Trading 

Fast Competitive Quotes 24 Hours 
Tel: 071-815 0400 or Fax 071-329 3919 1 


■ D-MARK FUTURES (MM) DM 126,000 per DM 


YEN WTURKS Yen 125 par Yen 100 



Open 

Latest 

Change 

Ugh 

LOW 

EsL vol 

Open M. 


Open 

Latest 

Change 

HWi 

Low 

Eet. vol 

Open H. 

Dec 

86628 

09542 

-09085 

0.6662 

86534 

31,738 

89947 

Dec 

19327 

1.0254 

-30074 

1.0358 

19236 

19972 

65.618 

Mar 

86559 

09666 

-80084 

0.6565 

36548 

209 

6948 

M8r 

19415 

19342 

-09075 

1.0440 

19330 

876 

8.430 

Jun 

“ 

09580 

" 

- 

09660 

6 

1267 

Jui 

19447 

19447 

-30075 

1.0447 

19447 

10 

715 

B SWISS HUWC FUTURES 0MM) SR 125900 per SFr 



■ SIBHUM FUTURES 0MM) £82500 per £ 




Dec 

8793S 

87829 

-80107 

87966 

a7818 

20,486 

41950 

Dec 

19192 

19040 

-30144 

19214 

1.8010 

11,708 

48999 

Mdr 

87841 

87863 

-00109 

87841 

37850 

198 

2229 

Mar 

19168 

19020 

-30168 

19206 

1.8010 

214 

728 

Jun 

3 7905 

87805 

-80113 

87905 

0.7905 

20 

196 

Am 

- 

1.8000 

- 

- 

1.6000 

2 

17 


UK INTEREST RATES 


LONDON MONEY RATES 


Ntw 9 

Over- 

7 riaye 

Ora 

Three 

Sbt 

One 


2.10672 

2.14823 

+300077 

-290 

591 

_ 


night 

nodoe 

month 

months 

months 

year 

Belgium 

402123 

389164 

+30246 

-198 

596 

14 

Interbank Sterling 
Staring CDs 

Treasury BSa 

Bank BBg 

Local authority deps. 
Dtacaunt Maricet deps 

7ft -Sft 

5A-5ft 
oft - Sft 

5ft • 5ft 

5A-5A 

Sfi-SA 

5H-5fl 
5ft - 5,5, 
5ft - 5ft 
5ft - 5ft 
5ft - 5ft 

sa-eA 
s - sft 
63-5K 
59-513 

eA-sa 

eft-sft 

•A -Bft 

6A - Bft 

aft -eft 

7ft -7ft 

7ft -7ft 

7ft -7ft 

betand 

Germany 

France 

Denmark 

Portugal 

Spate 

0908828 

194964 

353883 

7.43676 

192954 

154260 

3798188 

191402 

698139 

790210 

196.558 

169.458 

-3001675 

+0.00002 

+09083 

-300251 

+3338 

-3033 

-191 

-193 

365 

098 

1.40 

398 

599 

5.30 

2.71 

248 

195 

090 

13 

-5 

-0 

-9 

-24 

UK Peering bonk base taxflng rata Sft per cent from September 12 1994 

9-12 

NON ERM MEMBERS 
France 264918 

294964 

-3022 

1191 

-790 




up to i 

1-3 

3-6 

6-9 

Bely 

1793.19 

196694 

+1.78 

999 

-5.78 

_ 



month 

month 

months 

months 

■norths 

UK 

0.786749 

3780430 

-090Q719 

-090 

421 

_ 

Carts ol Tax doo. (£100.000) 1ft 4 3ft 3ft 3ft i 

Ecu cantm rates 

MtbythsEut 

DOT Owumifl 

tanCumndea 

■v ki rioocsndl 

ngrraratwst 

length 


Certs at Tax dap. undra EIOQPOO Is 1 ftpe. Dspoate aOukreRi tor cash ftpa 
Am. Itndw rate el dsoewK G^342po. ECCD fixed fbm SOg. Bent Fhancsb Mdniei day Oct 3f. 
1004- Agreed rats lor period No« 20, 1904 to Use 29. 19*4, Scharess Oft « 729pe. IWwence rate tor 
period Oct I. ISM to Oct 31. 188*. Sdranras WtV SJMSpc. Rnonce House Baas Rota Bpc tom Nov 
1, 1894 

FUTURES (UFTE) £500200 potete Ot 100% 



Open 

Sett price 

Change 

Hgh 

Low 

EsL vol 

Open Int 

Dec 

9397 

9390 

+305 

33.82 

9395 

14897 

144863 

Mar 

8276 

9290 

+306 

9292 

82.74 

19478 

74283 

Jui 

82.15 

9221 

+308 

9224 

92.16 

6192 

58902 

Sep 

91.73 

91.80 

+307 

9191 

91.73 

4299 

66195 


Traded on APT. M Opan Mraera figs, an for p re rtoua day. 


I OPTIONS (LffTE) ES00200 points ot 10094 


Strike 

Price 

Dec 

- CALLS - 
M* 

Jun 

Dec 

— PUTS - 
Mar 

Jun 

9850 

319 

308 

307 

309 

376 

198 

9979 

306 

302 

304 

021 

397 

198 

9400 

0.01 

301 

302 

041 

121 

191 


Eat voL tool. Cate 3040 Pure 4303. Previous day's opan tot, Cam 3*8119 Puts 21127a 


EMS EUROPEAN CURRENCY UNTT RATES 

Nov 9 Ecu can. Rate Change % +/- Irom % 

rates against Ecu on day 


oerv rate 


Dtv. 

Ind. 


radebateraan two spreads die percentage e e r arenoe braaraan era ncaalmrahw and Sai 
tor a oxrency. and the madronra patmftted p arconraga donation c t Bra caarencyf rearirat 
Ecu cantrW rata. 

(T7WB2) States and Ktean Ua aumandad tan EM Atfluramara eatcuhOad by Bra 



■ PHK2DBLPHIA SC C/S ODTKHIS £31250 (catta par pound) 


Strike 

- 

- CALLS - 

— — — 

— 

— PUTS — 


Price 

Nov 

Dec 

Jan 

New 

Dec 

Jan 

I960 

591 

593 

592 

- 

024 

368 

1979 

293 

391 

420 

301 

370 

190 

1900 

0.73 

196 

260 

hpb 

199 

229 

1928 

023 

384 

199 

204 

3.00 

394 

1950 

- 

337 

387 

443 

4.93 

540 

1978 

- 

311 

344 

893 

7.15 

744 


Predoua dqTs vat. Cate 3^48 Am 4,787 . Prev. dayte opan inu CMs aaajKe Pure *28.487 


■ HHEE MOKIH EURODOLLAR C4M Sim poWa of 10089 



Open 

Latest 

Change 

Hgh 

Low 

EsL vol 

Open bit. 

□ee 

8393 

3395 

+303 

8395 

9392 

71,717 

411201 

Mar 

8345 

93.47 

+303 

83.49 

9343 

96263 

418247 

Jun 

9296 

9299 

+024 

9320 

9295 

59203 

304278 


BASE LENDING RATES 

« » “ 
Adern 8 Company — 5.75 Duncan Lawria 5.75 

Afiod Trust Sank —5J75 aotarBenklirrflBd^- 275 CotparMxi Un*ed b no 

AS Bank 5.75 FteaneU 8 Qen Barflt 62 kaigeratehorisedas 

fArabedar BJB raFtabert Remino & Oo _ 8.TO abavMnglneEuflcn. 8 

5.75 Gknba* — S.73 HoyoIBkotScodand-. 075 

>Vtzaya.&78 •QUhness Mahon 8J5 ra&Tdh&VWman Sees. 5.75 

BankafCypRB..— .. 5.75 Babb Bade At32Uricfl. 5^5 TSB 5.75 

BankoJbokvKl 5.75 •HanbrosBsnk 5.78 flHHMBkonCranK— &75 

Btmkaflnda 5.78 HertaMe& Gen hvBk. 5.75 UMy Tiuat Berk Pte — 8.78 

Bar* of Scotland 5.75 9MSBnweL 5.75 Western Tnjst 575 

BanteyaBra* 575 C-HocraiCo 575 VWVteeway Lakiara 5.75 

BriBkoTMd East — 5.76 Hm^tongaShntfraL 5J5 YokahTOBank 5.73 

■Brown S^flayS CO LkJ 8.75 Juten Hodge Bank — 9.75 
CLBankNettartand... 5.75 Mraopted Joseph A Sou &75 •MraitonofUndoi 

CftbankNA. — —5.75 LJoydsBank &75 Enveatmt BsrMng 

Oydeedtea Bank -6.75 Meghrej BenkUd 5.75 Assoclaikxi 

The Or+oparaBre Bark. &75 MkflendBar* 5.75 * hateiMeeadan 

Oouds&Co.. —6.75 • Mount Berddho 6 

CredflLyameb 5.75 Nat WO Bb i i iutor — 5.75 

CyivuaPopiiar Bank -6.75 DRsaBrotiera 5.75 


■ U» TREASURY BKI. FUTURES QMI^ Sim par 1O0H 


Deo 

9494 

9494 

+303 

9494 

9493 

714 

17983 

Mar 

9424 

9423 

+303 

9424 

94.03 

333 

10282 

Jun 

9396 

9394 

+301 

8156 

93.83 

1238 

6.929 


M Open Wore* Bga. era lor pi l aus day 

jMAWC OPT10WS (LWT^ DMIm pcfcrts ol 100% 


S&lce 

Rice 

Nov 

Dec 

CALLS - 
Jan 

Mar 

Nov 

Dec 

PUTS 

Jan 

Mar 

8475 

0.10 

312 

307 

312 

021 

023 

025 

nan 

9600 

aoi 

022 

302 

025 

317 

318 

346 

048 

9826 

0 

0 

0 

302 

341 

041 

383 

0.70 


Btet crate 6906 Ns B48B. Pravku days opan brt, C* 21 SI SB Pub 1872S7 
SWISS HUtNC OFnONS (UFFE) SFr 1m pobite of 10096 


Strike 

Price 

Dec 

- CALLS - 
Mar 

Jun 

Oec 

— PUIS - 
Mar 

Jun 

9675 

020 

314 

309 

022 

323 

053 

9600 

023 

025 

304 

310 

0.39 

373 

9625 

301 

Q.o? 

022 

333 

361 

396 

Era. wL MIL eras 0 Mi a Pravtara <raya opan Vtl, crab 3S1B Ms 1085 



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INDICES 


E2£ 


WORLD STOCK MARKETS 


P 



NORWAY (Nov 9 / Kronor} 


*1 112 GS4 8 
*1 175 130 0 7 
♦JO IB-80 IT. 50 _ 
-4 1M 126 1J 
*2.50 114 84 _ 

*4 149 100 35 
*5 30637M 2.1 
-311530 80 3.7 

*327050 20B 1.4 
-. 208 140 O 8 
*8 305 100 12 

— 18450 130 3.7 
*50 81 7250 25 

*1 91 70 2.7 

*3 07 72 8J 

*3 122 8650 1.6 

*150 |S1 111 2J 

->0 54.50 1850 — 
~ 00 65 U 


- SMHWCN0V9/PBL) 




# 77/ 


ISS 3iBa 


1994 

HI01 Lon 


m 


w. 




/■f'lVIl 




515*1 13*i 
+ 3 aS 3 P? 20 


*r* 










FT 


US INDICES 


.. > * -■ 


. * . ■*' .. f af] 


Ma Mw 
B 7 





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ancixl TIMES 


THURSDAY NOVEMBER 10 1994 


4 pm dose Numbers 


NEW YORK STOCK EXCHANGE COMPOSITE PRICES 


ikh a bm tm. 

» % E KM Hp l«M 

a4B 18 20 no 12 % 123b 12% 

0.18 ID 41 90S 17% 17% 17% +1% 

1.88 20 26 1049 15 74% 74% 

88 2781 52% 50% 51 

13 643 4 3% 3% 

2.00 44 31 589 48% 48 48% 

0.76 14 1918021 US% 31% 32% 

OSD 15 11 908 13 12% 12% 

052 20 6 20% 20% 20% 

28 384 16% 15% 16% 

0.44 15 29 333 23% 23% 23' 


74 

380 

794 


■(fh iMSeck 
17% 12% MR 
18 I2$ALLtaeA 
79% S7$MFx 

72% 48%Mffl 

5 3% MX 
58% 38% ASA 
32 25% WOOL 
15% 11% AWbIPr 
23% 17%ABHM 
18 1I%AaAn*i 
31 22 ACE LB 

ACUMBIX 159115 
ABBuOppx 050 11 4 
ACMMSpx 098145 
SAQlMSex IDS 117 
7%AHUMX 159 142 
BACH Mnndi 072 85 
8$ AaneQrX 044 35 14 
6% Acme Beet n 

. 23 Aosta 050 22 14 

13% 3% Aetna 036 35 2 

18% 11% Acueen 134 1021 17% 17 

18% 18% AMna Bor 048 25 0 121 17 If 

84 46% M Men 3.00 04 2S2 56% 

350 115 11 4831 28% 

016 35 8 50 5% 

O10 05120 111 18$ 

157 14 13 16 62' 

278 09 61988 
048 15 14 948 
088 45 13 4420 18 
1 49 1 

058 11 28 1081 47 



7*J dBi. 

BT a% 8% 8% 
48 12% 11% 11% 
60 11% 10% 11 
7 27% 27% 27% 
243 10% 10 10 


31% 16$ Altaic 
6% SAdratOrp 
20 i5Ataahe 
64 49$ Aegon ADR 
68% 44 AfltnaL 

36% 25% AIk 
22% 16%Ataranx 
4 1$ ABeenhe 
50% 38% AkftC 


iBAUneRtx 030 15 11 


29% 19% Atryastae 
17 i4%AHaan 
30% 21$ AtfTctl 
18% 13%AfashaA4 
21% 16%AtairH 
17% 13%Ataml 
26% 19$«fcCuBx 
24% 17% AKUvAx 
30% 25% Altoi i 
28% 18% AfcnAI 
65% 48%AteSt 
30% 23%MeAMQ 
22% 14AfcsAl 
24% 17AUoghLud 
26% 19% Aiagp 
25% 13% Man Con 
28 ZOAtayai 
4% A Anon 
Z7% 17% AEncoCan 
10% 9AtacaO 
27% 21%/Wttn 
40$ 33% ARC* 

11% 8% Ataw 
29% 24 ABM Dp 

7% 4$ Abate 
35 21% Atarax 
90% 64% Alcoa x 
30% 1?Aba(»A 


49 242 
154 115 11 53 1 . 

7195 28% 
020 15 25 882 17% 
035 15 31 287 18% 
050 1.4 1125 14" 

126 1 1 17 120 
058 10 18 258 
044 15 24 5825 
030 150013300 
1.00 1.7 40 1253 59 


070 25 4 


... 9 % 

O10 05118 475 20% 19% 19 



»% 261 ; 


19% 19 

20 % 


19 


9% 6% AmatGd 
25% 19$ Areas W 
52% 44Anxnfe 
8% 8%AnA4Ra 
31 20% An Barrie* 
37$39$tanBmdx 


20% 18% Am CBp Bd 
23% 18% AnCtaCV 
tqd% 42%AnCysn 
37% 27% A OBPN a 
33% 25% fddBgir 
' I 24% Anted! 


148 14 18 1608 
154 65 10 998 
018 07 20 1549 
044 15 17 669 
1 126 
1.94 03 20 335 
018 ID 141 9% 9% 

050 37 15 13 25% 24% 

057 10 7 9540 34% 33% 

084 95 101 8% 08% 

056 35 19 1790 27% 27 

25 183 8% 6% 

14 821 28% 27% 

1.60 10480 7613 85% 91% 

35 2603 19% 18% 

11% 7 AirfjmJnc i 098115 387 7% 67 

8% 6% AmPrteS 025 3.4 25 37 7% 7% 

108 15 12 1149 6% 6% 

052 16 13 03 19% 19% 18% 

060 15 63 806 48% 47% 47% 
024 25 133 9% 9% 9% 

HO 14 3110139 24% 23% 23% 

. , 100 55 10 1248 34% 33% 33% 

25% 1I$AfliBURtf 180 35 13 48 21% 21% 21% 

8 6% Ain Cap tac 065103 312 6% 08% 6% 

- 1.54 03 28 93 18% 1, ’ 

158 5.7 0 28 19 1 

105 15 57 694401 00% 1 
140 7.7 18 3085 ' 

030 25 1318355 
1.16 *2 24 1426 28 27% 

. 5% Am Gout he 077 137 504 5% <6% 

27% T8$ AreHttfe 230115 7 191 19% 19% 

20% 16% An HafllQax 066 la ID 201 17% 1 “ 

G5% 55$Anttmex 100 4.7 13 9427 64% ” 

075273 9 101 ■£$ 2 
146 15 15 4268 94% 92 
150143 548 7% 6. 

188 18 92 25% 24% 24% 

91837 24% 24% 24% 


i% 

♦1 

* 

+% 

-% 

-% 

3 


St 

24% 21 24% Ja 

27% *% $ 


% 


S' 


, 2% AmHatBb 
96^81%AnM 
11% 8$ AorOpphe 
30 22% Aotom 
34 19 Ant Press* 140 16 
8% 7% Am Hab Es 144 55 



27% 21 An£ttr 146 15 

22% 1B%ftsVtaS%xlX 75 
32% BAnM* 158 45 11 

<1% 36% Ante 
*3% 32 Amemn Enc 

18% 11$ Ameta 
84% 50$ tanoeox 
9% 6% Amparitt 
5% 3% Aims he 
34% 29Aasoaft 
4% 2%Aneeomp 
58% <2%taW»H> 

36% 23% Analog 
23% 24% Angelica 
55% 47% AnBach * 

34 19% AnOiam 
18% i4%Antan7ln 
35% XAenCpx 


5 175 
7 3286 


7% 7% 


5 27% 26% 27 +% 

6 17% 17% 17% +1% 


* 


85 26% 26% 26% 

132 45 148038 40 38% 39% 

138 16 5 23 35% 34% 35% 

034 1.4177 470 1B% 17% 17% 
120 16 16 4729 62% 60% 61% 
010 1.4 5 66 7% 6$ 7 

112 11143 198 05% 5% 5% 
1.40 4J 9 521 29% 29% 29% 
9 315 2% flZ% 2% 

030 05 68 1098 48% 46% 40% 

33 1504 35% 14 34% 

0.94 3.8 23 55 26% 26% 26% 

150 11 23 4849 51% 51 51% 

22 358 33% 33 33% 

144 15 17 14 17% 17% 17% 

... 14B 45 7 2435 32 ' ‘ 

29% 22% AoaonCrp 028 15 39 3807 28 

10% B% ApoclAiiF 171 88 441 8% 

24% 14% APH 40 928 

7% 3% AppidUag 1 8565 _ 

25% 16%ApplP*Al 112 15 38 1 51 24% 

29% 21% ArtllOn* 116 15 19 8422 28 

51 43% Am OHKX 150 S3 21 191 47% . 

51% 45% AnacD45P 450 9.7 8 48% 46% 46% 

7% 4%Anrm 3 2407 7 6% 6% 

110 9.1 Z100 23 23 23 

158 H 31 1069 42% 41% 41% 
15 3717 38% 38 38% 

1 04 4% 4% 4% 

17B 35 14 554 25% 25% 25% 
040 15 88 8653 29 28% 23% 

056 15 12 8 30% 30% 30% 

1.10 19 14 2927 38% 37% 38% 
127 15 84 17% 17% 17% 

12B11D 8 110 2% 2% 2% 

112 03 25 1474 38% 38 38% 

132 14 16815 55% 54% 54% 

180 1.1 3253% 253% 253% 

108 BD 13 79 32% 31% 31% 

028 43 7 12 6% 8% 6% 

154 93 9 319 16% 16% 18% 

150 12182 2998106% 105% 105% 

2 814 3% 3% 3% 

58 17% 17 17% 

" «% " “ 


31% 31% 
Z7% Z7% 
08 8% 
23% 23% 
03 3% 
24 24 

ss 


29 22% Aram IIP 
57% 33% AnnaWx 
45% 33% Aim Bee 
7% 4% Asia ftp 
33% 23 Ante W 

34% 21% Aamtax 
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11 Titan: 7 733 13 12* 12* 

50*Tftuna 1.04 £0 19 1174 E SI 51 

7i*:«coi a jo 3.6 xi 22* 22* 22* 

30* Trtntty 068 1 9 20 290 3S* 35 35 

31* Tirana a 068 22 X1X3 32 01* 31* 

24* Tram aio 03 24 411 37* X* 36* 

2* Tucson Ej 116 3334 3* 3* 3* 


16* 13*Trnsoa 
14* 12* Tranaoo 


43 TinaMe 
is* I3*lnd60ar 
37* 3i*T«CDnC5 
2b* 11 Tihre 
64* SO*Trtuno 
24* 21* Men 
47* 30* TrhBy 
X 91* Tirana a 
37* 24* Troon 
4* 2% Tucson Q 


19* 15 StadHUBas a OX 63 IB X 15!} 15* 15* >* 

18$ 15*SeutM)Ei>n 024 1.4 17 187 17* 17* 17* >* 

30* 23*SUtM>S*lO20 OS 10 IX 25 

12* 8* Spam Find 046 4.7 54 9 

7* 4* Spartan Cp 7 0 5 

18* 12* StfcoaD 012 1.0 « 12 

41 29* spnno 1-20 11 14 332 3a 


38* 21*surrd 
32* 24* Stantoi a 
37 31* Sttrtnna 
44* X*SHWk 
44* 37* Sorfinc 
25*2 20 * Stan* 


2 ja as 10 IX 25* 25* 25* 

046 4.7 54 9* g* 9* 

7 0 5* 5* 5* 

012 1.0 49 12* 12* 12* 

IX 11 14 332 39* 38* 38* 

IX 11 23 BE1 33* 32* 32* 

040 2J 22 22 17* 17* 17* 


l8*12*S|*inD 012 1.0 « 12* 12* 12* 4* 

41 29* spring lifl 11 14 332 39* 38* 38* -* 

X* 31* SprtM 1.X 11 23 BE1 33* 32* 32* -* 

IB* 13$ SW 040 2J 22 22 17* 17* 17* >* 

19* 11* SW Conan 040 11 6 X 12$ 12* 12* ** 

26* 14*SUMt»ri 032 IS 13 254 IS* 18 IB* 4* 
12* 5* StardPMUnt 012 101 X 365 6* 0 6*-* 

36* Zl*surrd OX 10 11 SO 23* 22$ 22$ -* 

32* 24* Stantoi a 064 20 IB 203 31* 31 31* 4$ 

37 31* Sttrtune IX 12 ID 244 33 32$ 33 

44$ X* SHWk 1.X 16 10 313 40* 39* 39* 

44* 37* Sorfinc 1.40 17 79 38* 38* 38* -* 

2S* 20* Stolen OX 13 19 17 20$ X* 20* -* 

29* 24* SU-FeOBk 064 16 7 723 26* 25$ 26 -* 

7* 6* SfflrtnBcrp OX 10 6 33 B$ 6* 6* -* 

13$ 3$ StBrigOwn OX 071X 2423 12 11* 12 4* 

14* 0* S8C IX 10* 10* 10* 


4* 2$ Tucson B 116 3334 3* 3* 3* 

7$ 4* TMb> Dp 020 15287 535 6 5* 5* 

14* 6* TioMMh 012 17 263 7* 7 7 

28* 8* Tun Cera 064 63 2 754 12* 11* 12 

24* 18* Tnh Discs 070 13 X 16* 21* 21 21* 

56*4 42* Tyco L 040 08 27 669 <7* 47* 47* 

ID BTycaT 010 1.8 2 372 6* 6* K* 

B* 3* Tyler 17 355 3* 3* 3* 


0*8W 

X* 25SMuSwra 31 941 32* 31* 31* 

10% S* SflMRns 012 10 3 BO 5$ 5$ 5$ 

33$ 27* SttwSWeh OX 13 X 427 33* 33 33* 

21* 9* Stone Cent 0.71 45 5 3984 16* 15* 16* 


182 10* 10* 10* 
31 941 32* 31* 31* 


27* 19* Stop Shop 21 112 25* 25 25 

16* 13* S»; - ? i 088 6.1 15 251 14* 14* 14* -* 

41* 26SbTd1 9 42B4 29* 27* ffl -* 

39$ 22$ SMB M 7X 38% 37* 37$ 

18$ 12S*rtdeme 038 2JM1 676 13% 13% 13% -* 

33* 23$ StumRpBr 1^0 44 14 164 27 25* 27 +1 

4* 2 Sunni SUM 030109 0 6 2* 2* 2* 

1110*SaitteAi 1.10106 7 228 10* mo* 10* 

6* 4 Sun OK BX O»4J4 0 4$«*4$4* 

7* 4* Son Enopy 020 4.6 24 63 4* 4 * 4* -* 

fi* 33*a«unr OX 1J5 13 1130 «% M$ «* +* 

52 41 SMUT 120 2J 17 348 45* 45 45* -* 

1* 8 SmsWneH 1.19112 92 9* 9 9 -* 

3* 1* Surf*! 2168 2* 2 2 -* 

il* 43* GUPS 1.44 19 13 1217 X 48* 48* .+% 


46* 33* Strainr OX IS 13 »M «0% »7e «* +* 

52 41 Snwr 120 2J 17 348 45* 45 45* -* 

11* 8SmMhePI 1.19112 K 9* 9 9 -* 

3* T*SUreMI '2IX 2* 2 2 -* 

51* 43% Sum • 1.44 19 13 1217 X 49* 48* .+* 

14% 10* Sapw Food 036 15 12 30 10$ 10% 10* 4* 

46* 25% Bisudar 018 05 19 271 2^z 26* 29 

40* 23*Sl4M0 094 IS B1B59 24% 34* 24* 

20* 11$ SvgCm ttW “ 23 »51 u30* lft 20 +* 

23$ IBSHtoWhr 001 01 1M 2D* 20 M -* 

34% 15% Symbol Tec X11» 34* 33$ 34 -* 

10* 7*SyjnflC0fp 020 Z? 9 14 7% T* Qz 

10* 16%3p«aBFn 045 23 17 583u1fl* 19* 19% +* 
29* 21* Specs 044 1.7 22 3837 26* S* 25* -* 


29* 23* UJBRa 
8 4* IRS 
51* «*U6X«ai 
X 17* UGG 
31 * 23% LIST 

51* 48$ usxcuran 

IX 63* UM. 

10* 1$UDCHm 
24* i7*uacup 

11* 5* UHChe 
24 26* IMcoa 
27 20* IMfl Inc f 
17* ii*Untter 
74* 56 *Ub0b 
133*100* 1MW 
50$ 42* ItaCenp 
35$ 21* UnCuba 
14$ 6*lhtanCup 
54* 42* Una 350 
67 52* UnB 450 
39* xVUfiec 
67* 48UnPac 
28$ Z1$IMaSMMX 
22 IB* UntonTanas 
2* * UotJFa 

18* B%IMmm 
3$ 2% Una Carp 
41* 29* UUMeeol 
15$ 12*UU)oraRB| 


8$ SnaTEUBr OX 16 22 341 5* 5% 5% 

43* a*TCFHMBX IX Z7 12 MI J7* 37* 37% 
9% 8* TCW COW S 064100 2M B* 08% 8* 
48* 34* TOR Coni A 043 OB X 6 <7* 47* 47* 

2* 1*TISMB> OX 40 2 9 2 1$ 2 

29* IS* T#x 058 18 9 22X 15$ 15* 15* 

10* 13%TWPEaWp OX 5.7 9 IK 14* 13$ 14* 

77* 81 TMi 2X Z9 X 13ffl W$ 68* 69% ■ 

38* 22%TBhH1« OX 01 229 26$ 2B% 26$ 

9* 5*Ti*ytad 042 4J 3 X 5$ 8$ 6$ 


55* 36AU9MBne 
« 29UHR0MI 
6% 4* U8&dMx 
13$ ID* UWdphfhd 

* AiRRaMau 
15* 4USMr 

16* 11* usraa 

23* 18*USF»B 
29* 14USHnma 
41* 30$USUCpx 
24 li*U95hoa 
32* 15$ USSUS 
46* 35*U9Weet 
72 XIMTOC 
14* 12$ UMMdaro 
21 i3*lMrade 
34* 38* UnM Foods* 
16 15$ llnivM 

* Oil UMML 
14* 9*U9nrCip* 
26* 17* IhM Qp 
30* 24* UnocU 

X3B%UN1M Coni 
37*2S*U|#ra 
M 15* USUCO 


1.04 4J 15 623 26* 26* 26* 
31 X 8* 5l| 5% 
4.10 an X 46$ 48* 46* 
8 7HD 19* 18* 16% 
1.12 4.2 15 2448 Z7% 26% 28% 
4X BJS 4 49* 49% 49* 
HID 634 96 93* 93* 

1.66 840 1 255 2* 2 2 

IX 67 22 131 20% 20* 20% 
2 IX S$ S* 5* 
1.X 72 71 4422 22* 21$ 22* 
040 131 18 1544 26 25* 26 

010 08 13 11 12 11$ 11$ 

ZM 19 10 7 72 71* 71* 

454 19 17 1516 118115*116* 
1.X 14 64 1447 46% 48% 46* 
075 14 31 7855 31* 30* 31* 
21 8 14 13$ 14 

IX 70 Z20 44* 44* 44* 

4X O 3 2 54 X 54 

044 69 12 883 35$ 35* 35* 
1.72 10 13 0730 48* 047* 47* 
092 4J2 5 635 2S* 22 22 

020 14 X 7438 21* 20* 21 

• IBP ft % (4 

177274 7 2374 10% TO* 10* 
25 26 3* 3* 3* 

144 24 10 247 38* 35* 35$ 
078 8i X 373 12* 12* 12% 
020 74 IS 57 20* 20* 20* 
003 01 19 8226 50* 48* 48* 
Z7B 94 B 458 X 29% 28% 
028 54 5 171 5* 5 5 

- M », rvai 

012 24 01063 4* 4* 4* 

OX 1-4 15 5242 14% 14* 14% 
X 380 22* 21$ 22 

2 753 16* 16 10 

142 40 7 543 32% 32* 32% 
032 14 X 1546 17* 17 17* 

OX 04 8 4873 22* 21* 2l% 
ZM 54 32 3525 S7% 36$ 37* 
200 34 17 4761 Bl* 60* 61* 
002 64 13 75 13* 13* 13% 

M <7 20* EO-% 20% 
098 34 12 283 Z7% 26* 28$ 
IX 94 11 23 18* 16% IB* 
1 10 A & A 
030 21 18 167 0)4* M 14* 
OX 4.4 12 721 22* 21$ 21$ 
OX 24 22 9237 28* 2B ?B* 
OX 24 1019823 40* d3B$ 39% 
1-48 4 6 14 4IX 33* 32* 32* 
024 14 7 M 20* X* 20* 


'•3% 44* VF Cp 146 

34* 16V men* 057 

8* 4* VON ht OX 

9% G$ VMOfflp H > 094 

10* X$WBhmMBi 14J 
12* 9* yankanplMM DM 
7* ■J|t«naM 
39* ZS* ltirtjr DM 

X* 33 Unity 
15% 11* Vecbir in 

78* B0WEM500 SOP 

51* 31% Way H 

25* 19* Vista ft* 

X* roVvmiafcc 
35 24* VOCdom 044 

14 6* VMiOuer 
JO* 15* VdoCoS 
37* 30* VWeta a 20U 

S6>2 44 WcnM 1 33 


39$ 15$ HNS bid 
32$ ZB * 1M\ HiAJIn 1.9} 
JO* 13 Hater he 
35* X* Worn > 142 

IE* 12* wackennu 0 S 
5$ 3$ UUnoco 
42$ 33* KUpn < 0 78 

36* 26* WUacoCS 064 
J8* 22* maun Ol7 
I 5* 2* Wsma ma 004 
M*2 XIMwUunx 2 44 
16$ 13* W a t n e u y 100 
42* 33 V WashGL 222 
25* 2D%w*ratn I OB 
284221* WastfS 431 

36% 19%WadJn 048 

3* 1* Human tad 016 
IB* 13% WmsO IDofl « 020 
40% 34 Wshgtnan 13a 

11 6* WMnqn St 064 

X 24* VHUsMi m 0 n 

11* 7* WeOcm 0J3 

34% 17* WMknm 024 
IX* 127* WeU 4 DO 
16* 11% Hemp 1 024 

29* 21* West Co 046 
1B% 14*WhofeME OX 
X 39* 1410 
IB* 9* WsMAfll 

20% 6%Wsino 
35% iBHecmSre 020 
35)2 18* nrati Mng 023 
34$ X% Hsw Ftas 1.X 
15I4 10$ HtasB • 020 

6* 4* SHOMCOH 0 32 
20% 13% Mttn Wb9h 
20* 14$ WssQnc OX 
39 29% HsTwd 1 Id 
51* XHptra 120 
21* 13* wtmunr 010 
73* 48% WhHpl 122 
24% ia* mum 
IB 14^4 HWwn 034 
X 13% Mtfahu 
32% 25 >2 Mas hex IX 
9% 5%tncOK&G aio 
33% 22* WUhB 064 
7* SUWkura 0.06 

12 6* Moran 020 

58% 42% HhnDxs IX 
13$ 7%ygfenMX0 010 
27* 23* HfecEn 1 1.41 

33% 27 WstfiitS* IX 

18$ ISVWswO OX 

35 X* Wtfcu Crap 1.12 
30%22%W4XT OX 
Z7* IB* WUrartne 015 
26* 12$WocANtni OX 
Ifiz 14% HMlf Mto 010 
10 3% Wntfcap 
53$ 38* miMiy ox 
2D* 16* Hyig U4MT 028 
23* 18* Hums hr 044 


2 7 13 975 
25 887 

1 0193 91 
1< 5 S3 
139 57 

OO MI 
32 1009 
17 12 1288 
27 1018 
91 0 40 
83 r 30 
24 9ES 
in 1C1 

24 511 
13 10 1160 
13 54 

20 661 
6.4 37 16 

£0 19 404 


51% X* 51* 
21 20* 20* 
0 7% 7* 
6 * X* 6 * 
6 % 6 % 6 % 
9% X* 9% 
7 6$ 6$ 
X* 35% 35* 
37% *% *% 
lf$rf1l* IT$ 
(0 fi) U 

50% » 

21% 21* 31* 

1129 28* 29 

34 33$ 3J?o 
0% «* a* 
20 19* 19* 
31* 31 31* 

48* 47% 47% 


15 2X4 IB* 
68 13 777 X* 
X 569 18$ 
40 12 1209 33% 
2 1>466 17 14 

51 ZS 5^4 
19 20 1753 41* 
£4 13 456 27* 

0 7 2334716 24% 

12 B 184 3% 

32 36 6148 7B* 
7.5 6 587 fjlj 

6.7 12 325 34* 
5.1 8 X 21* 

1 7 IB 20246* 

1.4 23 292 33$ 

53 4 560 I* 

12 17 X& 17* 

6.5 25 112 35* 

72 13 USB S 
£9 IS 27 26 

£2 14 511 10% 

08 23 951 30% 

2.7 19 19W 147$ 

1 6 19 2068 15* 
1 7 19 44 20 

54 il 537 17* 

811 45% 
W 709 17$ 
hU 22l0 17* 

19 17 50, 22* 

1)0154 11 a 

7.0 ID ’43 29* 

1.5 19 £640 14* 

OO 0 70b 6 

22 333 lb* 
£6 5 585 16$ 

13 43 804 34 

32 14 6610 33* 
07 16 2262 14% 
£4 16 072 52% 

22 5 20% 

£0 17 SS2 17 
21 15 17% 

5.7 15 22 28% 

1.4 14 180 7 

£9 13 7256 29% 

09 14 15 a* 

20 IE 176 10* 
19 16 &BE 54* 

1.1 18 92 8* 

5.6 14 839 25* 

06 11 HI 27% 

£5144 31 16 

4.0 60 331 28* 
Z1 30 9364 XV 

07 14 IX 24V 

19 3 3501 15% 
07 15 14* 

9 1905 6% 

1.2 30 814 47* 

15 a 79 19% 

19 14 79 23* 


17* 17* 
=8* 28* 
10% 16* 
32* 33* 
13$ 14 

5 !> * 
41* 41% 

27 27 

23$ M 
3* 3% 
77 77* 
013% 13% 
<02* 33 

21 * 21 * 
245 * 246* 
33* 33% 
OJ* 1 % 
16% lb* 
35* 35* 
B% 8$ 
2S$ 25$ 

in* 10* 
29* 29* 

146% |46* 
14* 14$ 
27% J8 
16* 17 

44* 45 

17* 17$ 
17 17* 
21 * 21 * 
24% 24% 
M% 28% 
13% 13% 
5* 5% 
15* 15* 
16* IB* 
33* 33% 
da a 

14 14 

51% 51$ 
20 * ZO* 
16V 16$ 
•17* 17% 
X 28 
8% 7 

29 29% 
6% b% 
9% 9$ 

52% 53 

8% 6* 
25% 25% 
27* 27% 
15$ 15$ 
27% X 
28* X* 
24* 24* 
15* 15% 
14% 14% 
B* B* 
46 46 

ia$ 19 
22 * 22 * 


- X - Y - 


m% 87% tom 
53* xnraCora 
25)2 XrartBeEw 
42* 33$ Yon kit 
5* 1 Zapan 

14% 7ZUhB 
Z7% 2D% Zoratn KX 
7$ B% ZradxM 

16% 1l%2mii 
29% 15$ ZuraUid 
13$ 10* ZWooHind 
10% 8% Bm*o TUI x 


AM 3d 61 
a 56 1.1 X 

1Z2 as 12 

019 04 IB 
014 35 

9 

1.00 4.3 B 
083125 
OX 31 16 
OX 4.9 15 
1X103 
054 103 


4614 106% 
4 50* 
23 22* 
733 38* 
J42 4 

1306 1 3* 
13 23% 
104 6% 

69 13 

79 18* 
243 10% 
397 8* 


101% 101* -2$ 
SO* 50* *% 
21 % 22 +* 
38 X* 

3$ 4 

13% 13* -% 

X* 23* +% 
d&% 6% 

12$ 13 

17$ 17$ 

10% Ml* ♦% 
X* 87* J, 


rn 


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Viamy usto and km kr HTSE iUUa 1* penxl ton Jan 1 19W 
in a H* or axk MOH moumiu a 25 p«rai4 ■ nn las tom 
pUO. na pWs KUHrti HIQO ml awdend ur Omn W tie m stock oiy 
Linton RMnutss nan rata rf Md« A mto totowm* tend on 
n mm oadvaden. Sate Itguei am umkax 
aHMknd aao rased b-mrux att <x Otetond pus dock OMOaml 
c-MOHadRa OMdmL dd-caBad. O-obk yoar»v n* e-dnnmj OKtorad nr paid 
to pnceWv 12 naOB. SHtotere in Camua ham. «4ad b its, 
iK»rauaence Bx hOMml oacknd «ncr spur^ a rate maoem H** 
drad prid fM pra. nnwo. iteu rao. a no iota Mam 3 MW OMtoni 
mranp. k4MMM itoLte M *r pUd uto Ms. an ammxaOw tew «n» 
mratoah h Mren. ihmm m pmus: mras ira, huhom ram 
gtpd MV Die son U kMtep nUmt dn Merry Pit pncr-ear*te rata 
i-MOrnd rioumd 01 pud u pracednn 12 pram. Pte UBck dlmem 
a-etek xUL omfeedi beypi am u* or ra-mm KMm h» n 
HPCk to KBCxHng 12 monOto. raHaate cash rate oo B-ownaw a 
aMMtteflra due. ihw prary Ngb f-taWo MM. rt-tn hMi or 
luulniOTf a Mao raaw a raai «M toa MNqu ha a srarawm 
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yra^Hfete tod rate to U yteytoU. irai in HA 


AMEX COMPOSITE PRICES 


4 pm close November 9 


Stock Ul E 100s Hob 
AdyUPM 495 54 15 

Mil he 2 C T% 

Nptaatod 4 356 6$ 

A® 1st Pa lJH II 2 48* 

AmMdzB A 0JE411C 67 23% 

Aim&M 0X15S 3335010$ 
AraEqU 2 318 1* 

ftmsahfimA <3 124 7$ 

ASflkns 072 2B 271 2g 

AUnflBdi 23 5 2% 

AW 6 2702 5 

AUasCMB 0 3 A 

AufionA 6 61 7% 


n too 

Stock Dtr. E lOBs lfl|8 UnrCtafleCkng 

Caned FM 5 10 A A ft $ 
OnraVAx 064515 83 1^ 15% 15* 
Crown C A 040 8 5 15$ 15$ 15$ -% 

Craun CB 040 12 19 14$ 14% 14$ 

CUXc OSS 61 1120 18* 18* 18* +% 
Custenatc 16 20 2}I 2* m +1* 


BSHOcm 

BadgeiMto 

BaWaoTA 

BaryRG 

BAJedr 

Bead 

BHelton 

Bto-flsdA 

BtauAA 

Bcwnrar 

Borne 

Brascan Ax 


055 1 38 3tt 3$ 

073 19 zlOO 24$ 24$ 
OW 33 63 _BJ5 , 
23 217uW% 23% : 
071 433 14A 14% 

e 10 ill ia 

0X141 7 19$ 19% 

78 25 28% 27% 
057 X 169 43$ 43% ■ 
33 34 ft ft 
036 7 169 155415% 
1X237 231 14% 14* 


DMode 12 X 1 1 1 -to’* 

DUTBrt 29 10 1b% 16* 16* -* 

Ducocaow 9 67 4% 4% 4f 

Duptox OX 8 10 ft ft 9 1 

EtebiCo 046 13 4 13* 13* 1^ 

EetoBay OD7387 3730 11$ II* 11* 

EcUEnA 030 8 16 IB 9$ 91 

EdUDRS 4 M 6* 8 tf 

Ban 162886 35% 34* 343 


Stock Me E 100s Mgh LoraCteadrajj 

I MhcAm 1 67 IA 1* 1* 

I Helen 015 42 HDD 9* 9* 9% 
HuaotsiA 7 322 5$ dS% 5% -* 

brtonCp 012 X 25 11% 11* 11% +* 
H. Crane 317« 3* 3A 3% i 
htanww 1 78 423 16 14$ 15% 

hnxx 0X 181970 16% IB 18* -t-% 


stock Dht E IPOs mall Lora OOS0 Chop 

Perhl 080 17 76 10% 10* 10* ■►* 

PBMteB IX 6 I 17% 17% 17% 

PML0 024 16 2402 80% 59% 59* 

Plnway A 050 20 25 iC9 36* -% 

Ply Bern x 012 44 622 '9% 18$ 19'x , 

PIK OB4 15 15 l?% 13* 13* +* 

PresMOA 010 0 1M % djl % 


3 170 6* 5% 

21 G 13$ 13$ 13$ 
IS 9 3% 3% 3% 
IB 14 17* 17 17* 

68 135 B% 0 B* 

9 76 1>$ 1% 1% 
14 39 5* 5% 5* 
« U _S $ $ 

2X IX 13% 13* 13* 
9 6 30* 29$ 29$ 


14 13% 13 
20 19% 19 


19% ■* 


Fatih* 064 11 22 31 30% 31 4* 

FtanA 4X 15 Z100 70* 7Vp 70* -* 

FUCayBnc 020 13 16 11* 11* «* -% 


fete ID OX 76 18 30% 30* SOij +% 
Kwh U 29 1 1X 47* 46% 47* +1 

Rnuif 3 » ft X 3* 


Qdprop 2 35 $ $ 1 

Contnxx 020 14 23 24* 23* M* 
can Marc 014 io a \\ io% io* 
OffltoSA 001 4 476 2 1H 2 

DarotoB 4 72 2 02 2 

Champtan X IK 34* 33% 33$ 
OfcPD 004 41 S73 15$ 15*8 15% 
CrtrtWA 001 51 5* fi 5 

Conhco D300B 3 18% 1P| iPj 

Canpnsac 0 2 n if n 


n 080 5 X 
IFdAx 072 15 264 
IT 030 34 570 
OEM 2 51 

ran 0 13 X 

Ota 034 7 143 


i% 23* 23* 

Ifl iWi 15$ +% 

A 5% A .+& 


23 474 ^8 «4 If 

,i4 .Ti*a"3 i 


Hansen 4 307 37* 35* 36* 

MHfinA 044 28 56 27$ 27% 27% 

MranCo 020 37 S ft ft ft 

MBMd X 7 7 7 

nngA 13 170 B 7% B 

MSREipl 39 300 1*1* 1 A 

NMPtm 41412 2& 01$ 1$ 

MVTraA OSB341 1154 24% 23% 23$ 

MtiCanM 020 15 2U10* ID* IDI4 

NBUU£ 122H00 6* B* 6* 

MR 262 210 5* 5* 5* 

Olitan 12440 1273 32$ 31$ 32* 

PagasuaG OiO 9 B99 14% 14* 14* 


R apa n Ha d 

RBMUCp 


3t> -10 0 33* 33* 33* 
a 17 7% 7% 7% 


SJWCnpFOlO 9 2 34* 3a* 34* 

SVnUfea If 124 W* 17% 18 

SHLBb 1222 lie 03% 3* v,* 

T* Prods 020 47 15 0* 8% 8^ 

TelSData OX X 1404 46* 45$ 45$ ■% 

TlaarnMdCS X 318 15* N$ 15 

Thenwhs 32 233 31 30% 30% -% 

TotfW 030 20 49 1 4% 14* K* J4 

TcwnCfrary 5 924 1* 017* 1* f A 

Trtlon 1 5 1% 1% 1% -5 

TlhWlteX 7 717 5* 5% 5% +* 

TumrflrA 007 M 1OO 18% 10% 16% ■* 

lumiftS O071E 4K I8 7 g 10* 16% ♦* 


UtfOOdsA 5 4 2,* 2,‘j. 2A , 

UnTmtoS 020103 4 2,* ?i 7 1* ,* 

UraPlms 46 43 7 b* 7 +* 

USCeflul 247 52 32* 32 32* +* 

VlacranA 75 1488 40 * 39* 39% *% 

WacanB 10273 36* 38% 38* 

VeOOmU 26 8222 11% 9 ? g 10V 

WRET 1 12 17 34 12* 12% 12% 

Worthed* 080 13 64 28$ 28% 28% -»% 

XyBtxdx 4 715 4* 3% 4* «* 



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: 4. -Jtt v ■ Km> r- ... 


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40 


WORLD STOCK MARKETS 


FINANCIAL 


AMERICA 


Dow turns lower as 
investors reassess poll 


Wall Street 


US share prices fluctuated 
wildly yesterday morning as 
markets struggled to gauge the 
impact of broad Republican 
victories in Tuesday's elec- 
tions, writes Lisa Bransten in 
New York. 

By 1 pm the Dow Jones 
Industrial Average had fall en 
11.44 to 3,819.30. The more 
broadly traded Standard & 
Poor’s 500 fell 1.41 at 46124, 
while the American Stock 
Exchange composite dropped 
03 at 451.02 and the Nasdaq 
composite fell 1.01 to 766.53. 
Trading volume on the NYSE 
was 214m shares. 

In the first 10 minutes of 
trading the Dow surged to a 
gain of 38.02 points on opti- 
mism about Republican control 
of both houses of the US legis- 
lature. but later in the morning 
those gains were wiped out as 
confidence in Republican rule 
turned to uncertainty. At one 
point late in the morning, the 
Dow was down by more than 
20 points before a making 
slight recovery. Program-trad- 
ing and investor profit-taking 
sped the declines, which began 
very early in the morning. 

In addition to uncertainty 
about the government, inves- 
tors were waiting to see the 
extent of interest rate 
increases expected to come out 
of next Tuesday’s meeting of 
the Federal Reserve's open 
market committee meeting. 

Healthcare stocks got an ini- 
tial boost from the election 
news as traders reacted opti- 
mistically to the probable 
death of broad health reforms 
proposed by the Democratic 
President, Mr Bill Clinton, but 
they also fell with the rest of 
the market. Shares of drug- 
makers were up slightly by 
midday after much larger ini- 
tial gains: Merck, a component 
of the Dow. gained 4% at $36%, 
Pfizer was up $1% at $75%, 
Bristol-Meyers Squibb by S% at 
$58'/. and Eli Lilly by $% at 
$637.. 

Defence contractors also got 


an initial boost from the mar- 
kets as traders ventured that 
Republican gums might stem 
decreases in defence spending. 
After strong gains. General 
Electric fell S Y* to $48% and 
Raytheon was unchanged at 
$63%. Northrop Grumman 
gained $% at $44% and Lock- 
heed rose $7. at $72%. The hos- 
pital companies, Colum- 
bia/HCA Healthcare and 
National Medical Enterprises, 
also advanced and retreated 
with the markets. At midday, 
Columbia was up $7. at $40% 
and NME rose $% at $14%. 

Shares of Long Island Light- 
ing, a New York City-area pro- 
vider of gas and electrical ser- 
vices, fell $17. to $16% with the 
defeat of the incumbent state 
governor, Mr Mario Cuomo, 
who had proposed state acqui- 
sition of the utility. 

In trading unrelated to the 
elections the railroad, Santa Fe 
Pacific, rose sharply by $17. to 
$16 after Union Pacific sweet- 
ened its offer to Santa Fe 
shareholders. Union Pacific 
shares fell $% to $48%; if the 
takeover is overturned by regu- 
lators. it could be stuck with 
Santa Fe shares worth far less 
than the proposed purchase 
price. 

SciMed Life Systems shares 
rose $3% at $52 on news that 
the medical device company 
would be bought by Boston Sci- 
entific for $865m in stock. 


Mexico 


Brazil 


Canada 


Toronto relinquished earlier 
gains and traded mixed at mid- 
day as rate fears reasserted 
their dominance over post-US 
election euphoria. 

The TSE 300 composite index 
was 4.52 higher at 4,213.61 by 
noon in volume of 21.71m 
shares. Dealers noted that the 
fundamentals for the market 
had not changed and still 
pointed to a rocky road ahead. 

Of the market’s 14 sub-indi- 
ces, 10 held on to gains at 
noon, with weakness in the 
base mptals group dampening 
rises in transportation and real 
estate stocks. 


S$o Paulo rose 2.1 per cent in 
listless midday trade as prices 
remained strong after Telebras, 
the state telecom, posted posi- 
tive results for the first nine 
months. The Bovespa index 
was Up 990 at 48,811 at 1300 
local time in turnover of 
R$169.4m ($203.9m). Telebras 
preferred put on 3.7 per cent at 
R$41.50 after the group posted 
a better than expected 
R$710.8m net profit in the Jan- 
uary- September period. 


SOUTH AFRICA 

Industrials held on to early 
gains as the sector was sup- 
ported by firmer world mar- 
kets, while golds drifted back 
as the bullion price felL 
The overall index put on 43 
at 5.849 and Industrials 33 at 
6,775. The golds index was 
unchanged at 2,181. De Beers, 
which had risen in US trading, 
firmed R2 to R99; Anglos 
gained R3.75 at R243.75. 


EMERGING MARKETS: IFC WEEKLY INVESTABLE PRICE INDICES 


Market 

No. of 
stocks 

Nov. 4 
1994 

DoUnr tennis 
% Change 
over week 

% Change 
on Dec *93 

Local curency terms 

Nov. 4 % Change % Change 
1994 over week on Dec *93 

Latin America 

(208) 

731.05 

-1.1 

+12.4 




Argentina 

(25) 

906.48 

-1.1 

-8.8 

556,126.04 

-12 

-8.8 

Brazil 

(57) 

41222 

-3.2 

+77.1 

1,301,833,563 

-3.6 

+1,181.1 

Chile 

(25) 

013.43 

-2.6 

+47.4 

1,342.87 

-22 

+409 

Cotambta' 

(ID 

833.86 

+1.1 

+29.3 

1^27^7 

+02 

+32.4 

Mexico 

(67) 

923.53 

+ae 

-8J2 

1^6587 

+0 A 

+1.2 

Pent® 

(ID 

191.11 

-1.3 

+58.0 

258.91 

-12 

+82.8 

Venezuela 1 

(12) 

521.09 

-5^ 

-12.0 

2,034.88 

-52 

+432 

Asia 

(557) 

271.79 

-1.7 

-8.6 




China* 

(10) 

10235 

+i.i 

-31.3 

110.46 

+1.0 

-32.7 

South Korea 1 

056) 

153.01 

+2JB 

+29.5 

160£9 

+2.9 

+27.7 

Philippines 

(19) 

330^3 

+2.4 

-2.9 

392.92 

+1.1 

-11.5 

Taiwan, China* 

(90) 

146.04 

-3.7 

+8.0 

142.79 

-3-7 

+6.7 

India' 

(78) 

133.47 

+0^ 

+14.0 

148.91 

+1.0 

+15.6 

Indonesia* 

(37) 

111.28 

+1 2. 

-108 

13125 

+12 

-7.8 

Malaysia 

(104) 

293.17 

-3.7 

-13^ 

277.34 

-3.3 

-17.7 

Pakistan 1 

(15) 

389.53 

-5^ 

+0.4 

541.65 

-5.5 

+25 

Sri Lanka" 

(5) 

1954)2 

+1^ 

+103 

207.98 

+2.1 

+09 

Thafiand 

(55) 

447.91 

+0.8 

-6.2 

443.82 

+1.0 

-82 

Eura/MM East 

(125) 

mass 

+1.9 

-29.8 




Greece 

(25) 

220.96 

+0.2 

-3.0 

351.58 

+1j4 

-06 

Hungry" 

(5) 

179.40 

-1.6 

+7.7 

233.70 

+0.1 

+15.8 

Jordan 

(13) 

152.64 

-1.0 

-7.8 

22226 

-0^ 

-7.1 

Poland" 

(12} 

523.91 

+1^ 

-35.9 

767.81 

+2JS 

-305 

Portugal 

(25) 

120.15 

-0.6 

+10.9 

135.00 

+a4 

-Z3 

lUrkey" 

(40) 

119.12 

+4^ 

-44.0 

2JJ31.82 

+5.0 

+39.7 

Zimbabwe" 

(5) 

265^0 

+0.7 

+31.5 

326.88 

+09 

+53.0 

Composite 

(POT) 

356.16 


+0.1 





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Among the next wave of emerging markets - sometimes described as “frontier mar- 
kets” since they embrace the type of hazards often experienced when entering a new 
territory - Russia stands foremost, writes John Pitt. 

The recent volatility in the value of the rouble underlin ed the hazards of investment at 
the moment; although to some far-sighted investors the mayhem in the currency 
markets was lost a passing worry- Indeed, there are some ftmd managers who believe 
that within 20 years the country’s capital markets could equal those of the US. 

Merrill Lynch, the US investment bank, observing that blue chips lost some 25 per 
cent of their value during the rouble crisis of mid-October, suggests that primary 
market offerings, that is cash auctions, currently present a better opportunity for 
investors. The drawback to this method, says Merrill, is that companies offered in cash 
auctions provide little or no information, while the auction itself allows very little time 
for making decisions, “a fact that provides advantage to locals and insiders in a process 
that is aimed to attract large foreign investments”. 


FT- ACTUARIES WORLD INDICES 


EUROPE 


Bourses higher on US election results 



Thursday November 10 


The metals sector lost 0.5 per 
cent as Inco fell C$% to C$38 
and Me tail Mining dropped 
C$% to C$12% in spite of 
unveiling a third quarter profit 
of 7 cents a share, after the 9 
cents a share loss in the same 
1993 period. 

Actively traded issues 
inclueded Stelco class A, up 
C$% at C$8%, and Morgan 
Hydrocarbons, down 35 cents 
to C$450. 


Mexican stocks opened higher, 
boosted by cuts in domestic 
interest rates, but the fall on 
Wall Street by midsession 
trimmed the gains. The IPC 
index was up 5.28 at 2,617.57 at 
midday, after a high of 2,632. 

The 28day Cetes, or treasury 
bills, were trimmed by 48 basis 
points to 13.49 per cent at the 
central bank's weekly auction 
earlier in the day. 

Turnover was moderate at 
94.1m pesos, in volume of 8.1m 
shares. 


Bourses were able to reflect 
the Republican election victory 
earlier tban their US counter- 
parts, and doubled or trebled 
the level of Wall Street's antici- 
patory gains overnight, writes 
Our Markets Staff. 

When the Dow put on a per- 
centage point in early trading, 
said Mr James Lister-Cheese of 
Independent Strategy, it looked 
as if the US were following 
Europe, rather than the other 
way around. However, bourses 
seemed willing to follow Wall 
Street down when it lost some 
of its enthusiasm. 

Independent Strategy said 
that the Republican victory, 
and its potential impact on 
external trade decisions and 
the progress of internal budget 
reductions in the US. was 
likely to cause volatility in 
financial markets. “On a one- 
year view, we think that 10- 
year US Treasury yields will 
rise to 85 per cent from today’s 
level of 8.0 per cent." 

FRANKFURT came back 
from a session's gain of 43.03 or 
2.1 per cent at 2.096.47 to 
2,090.78 at the end of Ibis trad- 
ing. Retailers stayed weak on 
worries about consumption 
trends, said Mr Jens Wrecking 
at Merck Flnck in Diisseldorf, 
but otherwise the market rose 
across the board in the mom- 





jr^ncii§2s 


— 

Nov 0 



THE EUROPEAN SSSES 

Wuriv ounce 

Ope" 

1DJ0 

1140 12tj 1 3l& 

1400 

1580 Ock 

FT-SE Eunxrack 100 
FT-SE Eureliaek aDO 

13»^ 

140168 

133136 

1400.75 

1341.1 1 1344 OS 1346^7 
140154 1408.72 WIJ4 

134592 

140BJ4 

1347 JO 134514 
141033 14S538 



Nova 

No, T l.zt 4 

Nor 3 

He 2 

FT-SE btatm* 100 
FT-SE Euravac* 200 


I224J9 
136-' 92 

13Z3JS6 133172 

133639 13SLS5 

13S5L5B 

133188 

131501 

1382.67 


Hm looo ra&nO'-sa up car 'oo - 13A- ii sn ■ mu as uartar - na® ns - raesa f wm 


mg. turnover nearly doubled, 
from DM42bn to DM8bn. 

The afternoon saw relative 
weakness in a number of big 
blue chips. Siemens and Volks- 
wagen. up DM4 to DM625.40 
and DM5 to DM447.5*}. were 
both well off the top. Analysts 
said that a Siemens results 
conference had been disap- 
pointing in content, and VWs 
global car sales in September 
dropped by more than 6 per 
cent. 

In chemicals, BASF rose only 
DM1.10 to DM317 after talk of a 
takeover bid for Boots' phar- 
maceuticals division, diluting 
hopes for BASF’s gas business; 
and Viag. the utili ty based con- 
glomerate. up just DM1 to 
DM471, extended its role as a 
Dax underperformer in Sep- 
tember and October. 

ZURICH was cheered by 
hopes of a stronger dollar, and 
the SMI index rosq 465 or L8 


per cent to 2590.4 as analysts 
noted that the weakness of the 
US currency had depressed the 
third-quarter results of the big 
exporters by around 8 per cent 
Pharmaceuticals were lifted 
by expectations that a Republi- 
can majority in Congress 
would slow President Bill Clin- 
ton's health reforms. Roche 
certificates picked up SFrl55 to 
SFro.945 and Ciba registered 
were SFriU ahead at SF17©. 

Insurers firmed as they 
sought to play down their 
exposure to the storm damage 
in northwest Italy. Zurich 
Insurance registered were 
SFr26 higher at SFi%24L 
UBS stayed volatile, with the 
bank said to be buying the 
bearers and Mr Martin Eb tier's 
BK Vision picking up the regis- 
tered stock ahead of the 
extraordinary shareholders’ 
meeting on November 22. The 
bearers rose SFr21 to SFrL204 


and the registered were SFri4 

higher at SF1286. 

PARIS tailed off during toe 
afternoon session, the CAC-40 
index °"ding with a gain of 
W*>. or 1.2 per cent at L94356, 

after a high of L96L 

Tumover improved to 
FFr45bn. Alcatel lost FFr15 .60 
at FFrtSLOO after its German, 
unit reported that it was to lay 
off a larger than expected num- 
ber of employees during 1994 
and 1995. Alcatel-SEL, of Ger- 
many, also said that it saw no 
return to profitability before 
1996. 

Lafarge Coppte. the building 
materials group, outperformed 
the market with ah advance of 
FFr15 to FFr406 after reporting 
an 8.5 per cent increase in 
nine-month sales. 

AMSTERDAM was driven 
higher by overall strength on 
the Continent. The AEX index 
added 355 at 41154. 

Royal Dutch, expected to 
announce a modest rise in 
third-quarter figures today, 
with the chemicals side likely 
to show the best performance, 
firmed FI 1.70 to FI 19150. 

MILAN was carried along by 
the upbeat mood elsewhere, 
although domestic and budget- 
ary worries were never far 
from the surface. The Comlt 
index gained 10.74 or L7 per 


cent at 63059- 

Blue chips were broadly 
higher, with Elat UJTLlCL at 
L6, 245, Montedison L29 at 
1AJ254 and Telecom: itaita L32g' 
at L4JH2. Among the banks, 
Credito ItaHano picked up L& 
to Ll,628, after the end of 
bourse trading of its rights 
issue on Tuesday, and as Sc- 
offer for Credito Romagnolo . 
remained in play. Romagnafe- 
rose L183 to L16.669. BC3 appre- 
dated L75 to L3585. 

Insurers ware mixed as the' 
industry continued to assess - 
the storm damage in the riartte 
west of the country. GenErail 
rose L431 to L37.881 but Ina 
was Jn st'La higher. at l 5,17.0. ; 

STOCKHOLM hosted better; 
than expected nine-month fig: -; 
urea from Electrolux: Hie 
AfiSrsvarfden index rose 155 
to 1,461.0, -although worries 
persisted over the. outcome of 
Sunday’s EU referendum. .. 

Electrolux B added SKtiUP 
at SKr365, while the drag sub- 
index advanced LB- per cent, 
ahead' of reports from Pharma- 
cia today, and AstratonMxrow. 
Astra “A" rose SKr5 to 
SKT19250 and Pharmacia a A ’ r . 
climbed SEz250 to SErt35. 


Written and affiled by Wrana 
Co chr an e, John Pftt and MUm| 
Morgan 



+S* 


r 8 . 


V^tj. * .. :. 






fir 


ASIA PACIFIC 


Nikkei 


Tokyo 


relinquished 216.81 at 21,46556 
in volume of 445m shares. 


The Nikkei 225 average fin- 
ished at a seven-month low 
after profit-taking pushed 
share prices down for the third 
consecutive day, writes Emiko 
Terazono in Tokyo. 

The index was off 185.14 at 
19,423.88, its lowest since April 
4, after a day's high of 19,65453 
and low of 1953157. Arbitrage 
buying lilted equities initially, 
but active sales in the after- 
noon by foreign and individual 
investors depressed prices. 

Profit-taking by institutional 
investors looking to cover their 
foreign exchange losses on 
overseas bond holdings, due to 
the recent appreciation of the 
yen against the dollar, also 
weighed on the index. Some 
shares regained ground on 
small-lot bargain hunting 
towards the end of the session. 

Investor confidence was 
dented, too, by the decline in 
privatisation issues. Individual 
investors and dealers, fearing a 
Further fall in the market, took 
profits in early trading. Trad- 
ers expect the next support 
point of the Nikkei 225 to be 
around the 19,11152 posted on 
March 3L the final day of the 
last business year. 

Volume increased to 299m 
shares from 210m. The Topix 
index of all first section stocks 
fell 16.99 to 153358, while the 
Nikkei 300 shed 3.09 to 28053. 
Declines led rises by 867 to 124, 
with 170 issues unchanged. But 
in London the ISE/Nikkei 50 
index gained 253 at 156253. 

Japan Tobacco fell Y16.000 to 
Y994.000. Investors had been 
nervous over the stock drop- 
ping below Ylm, regarded as a 
psychological support level. 
Nippon Telegraph and Tele- 
phone dipped Y29.000 to 
Y863.000 on active foreign sell- 
ing, while East Japan Railways 
shed Y3.000 to Y475.000. 

Banks, which depend on 
unrealised gain!? on stockhold- 
ings to support their capital 
ratios, felL Industrial Bank of 
Japan receded Y60 to Y2580. 

Large-capital stocks were 
sold in busy trading. Nippon 
Steel, the day’s most active 
Issue, lost Y4 at Y384 and Mit- 
subishi Heavy Industries 
declined Y18 to Y752. 

In Osaka, the OSE average 


Roundup 


Morgan Stanley Asia added its 
voice to those reducing the 
weighting of Hong Kong equi- 
ties. It lowered its allocation to 
a still overweight 35 per cent 
from 40 per cent in its Asia- 
Pacific model portfolio. The 
move came less than a week 
after HG Asia (Singapore) also 
recommended investors to trim 
allocations in Hong Kong. Mor- 
gan Stanley upgraded Malay- 
sia. Thailand and Singapore 
but cut Australia’s weighting 
to neutraL 

HONG KONG finished down 
but off lows on late futures-led 
demand after dipping on news 
of the Morgan Stanley move. 
The Hang Seng index lost 1051 


at 9,405.48 after touching 
955652. Turnover stayed thin, 
at a preliminary HK$2,lbn. 

TAIPEI rose sharply on late 
buying in the electronics and 
finanmai sectors, although, bro- 
kers said they expected prices 
to consolidate ahead of local 
government elections on 
December 3. The weighted 
index put on 101.19 or 1 j 6 per 
cent at 6,44959. Turnover came 
to TS4LI5bn. 

SEOUL edged down in vola- 
tile trading as selling of finan- 
cial shares and mid-priced blue 
chips alternated with buying of 
primary blue chips. The com- 
posite index dosed 056 off at 
1,13859, after backing down 
from an all-time intraday high 
Of 1,145 -0L 

Most preferred stocks were 
sharply higher after the Securi- 
ties Supervisory Board told 


listed companies and securities 
houses to buy back 3 per cent 
of their own companies’ pre- 
ferred stocks by the first quar- 
ter of 1995. 

SINGAPORE rebounded as 
institutional funds returned to 
buy blue chip banks and prop- 
erties. The Straits Times Indus- 
trial index rose 1759 to 2544.40 
as Salomon Brothers com- 
mented that Singapore’s resi- 
dential property market 
appeared due for a downward 
correction but the commercial 
market was on track for a 
cyclical upturn. 

BOMBAY’S 30-share index 
ended 9051 or 2.1 per cent 
lower at 4505.68 an hectic sell- 
ing by domestic and foreign 
mutual funds. Brokers noted a 
lack of liquidity as mutual 
funds, committed to investing 
in the partial privatisation of 


seven state-owned companies, 
held back from makh^ fresh 
investments. 

KUALA LUMPUR continued 
to be weighed down by forced 
selling by investors unable to 
meet marg in rails The com- 
posite index declined 6.45 to 
LOSL01. 

. SYDNEY was pulled higher 
by strength in golds. The All 
Ordinaries fartor added 155 at 
. 1,982.6 and turnover was 
A$375.8m. Resources . issue 
C RA ro se 28 emits to A$1856. 

WELLINGTON sawa decline 
in Carter Holt Harvey pressure 
prices overall. The NZSE-40 
Capital index fell 10.46 to 
2,075.17 in NZ$3L8m turnover. 

CHH dropped 14 cents to 
NZ$356 as a result of worries 
about its recently announced 
purchase of Bo water’s Austra- 
lian operations. 



: F** 


Jointly compisd by Tbs Rnanctol Timas Ud, Goldman. Sacha & Co. and NaWVSat Securities Ltd. in conjunction with the Institute of Actuaries and the FaaJty of Actuaries 
NATIONAL AND 
REGIONAL MARKETS 
Figures In paremhaeoB 
show number of loss 
of stock 


TUESDAY NOVEMBER 8 1894- 


US Day’s Pound 

DoBar Change Storing Yen 

Index % Index Index 


Local Local Grow 
DM Curaney M eftg Dtv. 
Index Index on day YMd 


MONDAY NOVEMBER 7 1994 DOLLAR INDEX 

US Pound Local Year 

Deter Starting Yen DM Currency 62 week 52 week ago 
Index Index Index index index Htgh Low (approx) 


Australia I 


Austria CIS). 


Belgium (35] . 


Brad (28).. 


Canada (103). 


_ira.ii 

.183.45 

.169.55 

-182J4 

..132.90 


Danmark (33). 


MM 


FMsnd (24) 

Ranee flOi). 


...1S1J34 

-.171.08 


Germany (50) 

Hong Kong (58). 
NondfM 

Italy (5®)- 


-144J JS 


—20032 

.7851 


Japan i 


Malaysia (97). 

Mexico (IQ.. 


-16034 

..51040 


.2151.69 


Nottarfand 08)- 


New Zeeland (14). 

Norway (23) 

Singapore (44) — 


-21IL53 

—78.4a 


.19852 


South Africa (59). 
Spain (38). 


— 339.14 
—140.71 


Sweden peg. 




Swtaeriand (47). 
TTMlend (46). 


-165.79 


-17526 


United Kingdom (204). 


201.00 

.19030 


-0.7 

15422 

10370 

132.74 

14822 

-08 

3.73 

17029 

15621 

104.78 

13422 

15023 

139.15 

14828 

165.B3 

-0.1 

168.06 

112A9 

14329 

14328 

-07 

1.12 

18324 

168.70 

11226 

14426 

14426 

18629 

167.48 

17B21 

03 

15532 

10326 

133.07 

13000 

0L0 

425 

16927 

16529 

104.00 

13326 

.13005 

17724 

15060 

151.75 

0.B 

16722 

111.83 

14327 

27005 

0.0 

a74 

181.18 

16648 

11143 

14229 

279.10 

_ 

_ 

_ 

03 

121.78 

91.49 

10421 

13026 

04 

2.81 

13221 

121.79 

8121 

10422 

13003 

14621 

12054 

13426 

0.1 

22591 

15121 

18556 

19047 

-04 

120 

24641 

226.46 

15127 

184.36 

19924 

276.78 

23027 

24068 

02 

17526 

11723 

150.18 

187.08 

-05 

0.76 

19022 

17547 

117.44 

15060 

16725 

20141 

116.85 

12225 

09 

1S727 

10S27 

134.75 

13828 

0.7 

3.11 

17027 

1S621 

10421 

134.15 

138.07 

18527 

15924 

16220 


13126 

6623 

11326 

11326 

02 

123 

14228 

131.12 

87.75 

112.63 

11323 

16040 

12827 

13022 

-02 

330.10 

23424 

29926 

379.21 

-02 

3.17 

38227 

361.69 

23521 

302.01 

37821 

60068 

34129 

38829 

0.7 

191.78 

12828 

18429 

18427 

04 

342 

207.77 

19026 

12720 

16328 

16426 

21620 

17225 

174.80 

OO 

7048 

47.18 

6027 

88.11 

-02 

1.78 

7623 

7070 

4722 

6028 

6842 

97.70 

5728 

B4.B8 

0.1 

14629 

0822 

12025 

9022 

-02 

078 

16019 

14723 

8824 

12030 

8824 

17010 

12424 

14724 

-03 

473.13 

31629 

40536 

90070 

-02 

125 

61729 

47007 

31623 

40629 

511.17 

621.63 

43071 

45526 

1.0 

1971.14 

131028 

168820 

006013 

02 

127 

213122 

1958.79 

131028 

1881.12 

798428 

264726 

168828 

178422 

02 

20010 

13420 

17122 

16822 

-ai 

342 

21722 

20019 

13328 

17121 

1692B 

22320 

187.01 

18428 

-18 

6920 

4626 

6827 

6620 

-12 

3.72 

7720 

7025 

4749 

6020 

66.08 

7729 

5922 

81.75 

02 

181.68 

12121 

15528 

177.49 

-02 

1.88 

18724 

16122 

121.89 

15626 

17720 

211.74 

165.52 

17740 

ao 

380S7 

24125 

30823 

26572 

-ai 

120 

383.73 

30127 

242.19 

31027 

266.12 

40128 

2B428 

306.35 

-0.1 

31069 

20726 

288.18 

29729 

-as 

2.15 

33825 

31128 

20074 

28727 

30040 

342.00 

202.72 

202.72 

02 

12820 

8628 

110j44 

134.13 

-02 

425 

14044 

12927 

8820 

11076 

13444 

155.79 

128.88 

13B.45 

2.1 

21326 

14224 

16227 

251.48 

12 

129 

22820 

20922 

14043 

18008 

24820 

24226 

175.83 

188.02 

05 

151.68 

10126 

190.13 

12920 

-42 

127 

16426 

16123 

W46 

130.13 

12820 

17626 

146.61 

146.81 

-as 

16065 

107.47 

13726 

16821 

-02 

127 

17621 

18229 

10322 

13924 

171.11 

_ 



03 

164.09 

12322 

16824 

18428 

-ai 

<14 

201.07 

164.79 

123.68 

15820 

184.78 

21426 

181.11 

18420 

02 

17423 

11629 

14826 

19030 

02 

227 

18927 

17324 

11642 

14829 

18827 

19024 

17825 

16729 


Americas (684) 

17820 

06 

1S32S 

10927 

13926 

14004 

02 

220 

17723 

16228 

109.01 

13079 

14725 

_ 


_ 


173.18 

02 

16065 

106.19 

13623 

14927 

ai 

3.12 

17229 

15824 

106.88 

13520 

14941 

17058 

154.79 

156.96 

Nanis (116) 

22421 

12 

206.75 

137.73 

17629 

206.19 

06 

144 

22123 

20326 

13051 

176.05 

205.12 

23321 

173.18 

18826 

Padfle Basin (793) 

16927 

02 

166.16 

10326 

13224 

10824 

-03 

1.11 

16035 

15624 

104.17 

13328 

109.11 

17628 

134.79 

15525 

B*D-Padfic (1600) 

17088 

02 

15052 

104.77 

. 134.10 

12528 

-ai 

127 

17047 

15827 

104.86 

13448 

12621 

175.14 

14328 

15626 

North America (61Q 

18074 

as 

17127 

11420 

14028 

18820 

06 

220 

165.74 

17071 

11426 

14821 

18S.1B 

192.73 

175.B7 

184.00 

Bsopa Ex. IK ^03). 

-15427 

07 

14123 

9420 

12129 

12828 

02 

222 

15325 

14024 

9426 

12088 

12069 

15012 

13524 

13081 

PBdhc Ex. Mtan (325) 

-257.54 

-04 

23623 

16722 

202.14 

227.48 

-04 

221 

2SB24 

23722 

19823 

20923 

22842 

29821 

23054 

23328 

World Ex. US (1706) 

172.79 

02 

15329 

105.95 

13522 

12827 

-ai 

127 

17228 

158.43 

106.04 

13627 

12829 

17065 

14528 

157.05 

WOrid Be UK C201S)_ 

-17524 

02 

16024 

10748 

13724 

14421 

ai 

ono 

17422 

16040 

10741 

137.74 

143.79 

17059 

15626 

18423 

World Ex. Japan (17&5) _ 

18074 

02 

17220 

115.73 

148.13 

17627 

02 

220 

18729 



14820 

17038 

19520 

17034 

177.82 

The WorM index (2223) 17727 

02 

16227 

10828 

13927 

147.71 

ai 

228 

17626 

16223 

1082S 

13928 

14722 

18020 

15085 

106.15 


Copyright The FtaaicW Tam Dated, 
LUest prion unanaUto lor Ha adtton. M 


Sachs and Co. and NdWM Sacurtaa Urated. 1867 
now: Bwwfcnsirertel epan 9T1 1/8L Madrid rrerMtCOMd 6711*4. 

















L. _ . 


*BtES*r IWP 


-- 




”T- • 











^icLufflit Oil 


w t 


flop 


wofiinj on evr 
eiirttts' kb* If Lt 
37 eities, in 30 
eountries, we've one 
common work ethic. 

To never be complacent. 

To never lake refotion- 
ships for granted. And. to 

wori until the job is done. To your 
satisfaction. And ours. 




S. 


S'** 


SkO ' 


^*r«. ’ ' 




















NVESTMENT BACKING. FROM A TO 


MEMBER OF THi SECURITIES AND FUTURES AUTHORITY AND MRO 


A DIVISION OF BARCLAYS BANK PLC 


_ T... 


I .