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minister 

‘acted unlawfully 1 
over dam project 

British foreign secretary Douglas Hurd acted 
unlawfully when he earmarked £243m (9390m) from 
the country’s overseas aid budget for Malaysia's 
Pergau dam, the High Court in London ruled yester- 
day. It said the grant was flawed because the proj- 
ect was "economically unsound” and did not com- 
ply with British aid laws. The decision was a 
victory for lobby group. World Development Move- 
ment, which argued that Mr Hurd overstepped his 
powers by allocating aid for the improper purpose 
of promoting trade with Malaysia Page 9 

US producer prices fell by 0.5 per cent last 
month, helped by low new car prices. News of the 
fall blunted inflation fears and boosted US bonds. 
Page 16: World stocks. Page 38; US bonds. Page 21 

New Bank of Japan governor named: 

Yasuo Matsushita, a for- 
mer Japanese vice 
finannp minister, was 
nominated next governor 
of Japan's central bank 
after a long internal gov- 
ernment wrangle over 
who should get the post. 
He Is currently an 
adviser to Sakura, one of 
Japan's biggest commer- 
cial banks. Subject to 
cabinet approval. Mr 

Matsushita will succeed current Bank of Japan gov- 
ernor Yasushl Mieno, whose five-year contract runs 
out next month. Page 16; Observer, Page 15 

Royal Dutch Shelf Group’s third-quarter 
profits slipped 1 per cent to £853m ($531 -3m), ham- 
pered by production losses from Nigeria's recent oil 
strike and fighter refining margins in Asia. 

Page 17; Lex, Page 16 

Iraq recognises Kuwait: The ruling 
revolutionary command council of Iraqi president 
Saddam Hussein announced it had recognised 
Kuwait within its new UN-defined borders. Page 6 

Lyormalse das Eaux-Dumez, one of Prance's 
biggest building groups, is to stop making political 
contributions following corruption investigations 
which have shaken French business and political 
circles. Page 16 

Axa may seek overseas listings: The big 

French insurance group is considering requesting 
stock exchange quotations in London, Tokyo and 
New York over the next two years. Page 17 

GfILanka election: Prime minister Chandrika 
Bandaranaike Kumaratunga swept home by nearly 
2m votes in Sri Lanka’s presidential election. 

WEU chief chosen: Portuguese diplomat Jose 
Gutileiro was appointed to the top job at the West- 
ern European Union; the nine-nation security club 
whose role looks likely to grow. Page 2 

Polish minister sacked: Polish president Lech 
Walesa sacked defence minister Piotr Kolod- 
ziejezyk, his erstwhile ally, following a bitter row 
over reforms in the armed forces. 

Vietnam licenses US banks: Vietnam's central 
state bank licensed Bank of America and Citibank 
to open branches in Hanoi They will be the first US 
banks to do so since the Vietnam war ended In 1975. 
Page 7 

Hong Kong economic forum move: China is 
to let Hong Kong keep its separate identity in the 
Asia-Pacific Economic Cooperation forum after the 
colony returns to Chinese sovereignty in 1997. Apec 
agrees investors’ code. Page 5 

Zhirinovsky loses Ubel action: 

Ultra-nationalist Russian leader Vladimir Zhirin- 
ovsky lost a $1.4m libel case be brought against a 
Finnish theatre. The theatre was alleged among 
other things to have compared Zhirinovsky to Adolf 
Hitter. 

Serbs ponder war: The self-styled Bosnian Serb 
parliament spent a second day discussing whether 
to make the conflict in former Yugoslavia official. 
Page2 

Bugs resist drugs: New York Medical Centre 
tie scientists reported a new strain of antibiotic-resis- 
tant bacterium. They warned that its appearance 
implied that antibiotics might soon become useless. 

Ferry door to be salvaged: Sweden and 
Finlan d agreed to raise the bow door of the ferry 
Estonia, which sank in September with the loss of 
some 900 lives. 

Rum doe Britain's typical ram drinker is old, 
single. Scottish and rents a council house, accord- 
ing to a consumer survey on spirits. The upper clas- 
ses prefer gin. 


FRIDAY NOVEMBER 11 1994 


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‘Leftwing elitists’ take flak from US poll victors 


By Jurek Martin In Washington 

The spirit of political co-operation so 
evident on the morning after the US 
mid-term elections was fast evaporating 
yesterday, mostly because victorious 
Republicans could not resist taking 
potshots at President Bill Clinton. 

Several Republicans also warned the 
president not to frustrate implementa- 
tion of their legislative agenda on issues 
ranging from increased defence spend- 
ing and deeper cuts In social pro- 
grammes to cuts In foreign aid. 

The most provocative comments came 
from Congressman Newt Gingrich, vir- 
tually certain to become the next 


Speaker of the House and - mostly - 
still trying to be Tnagwanimniw in vic- 
tory. He promised, for example, no lon- 
ger to call the president an enemy of 
"normal” Americans, a favourite pre- 
election epithet 

However, what he gave in 24 hours 
filled with media interviews he also took 
away. He described Bill and Hillary Clin- 
ton as "counterculture McGovemicks," 
a derogatory reference to the leftwing 
Democratic presidential candidate of 
1972. The current White House, he said, 
was dominated by “leftwing elitists.” 

Warming to his familiar conservative 
theme, he said: "There are profound 
things that went wrong, starting with 


the Great Society [President Lyndon 
Johnson's social legislation] and the 
counter-culture, and until we address 
them head-on we're going to have these 
problems.” 

Congressman Bill Archer from Texas, 
likely next chairman of the House ways 
and means committee, also expanded on 
the Republican tactical approach. "We 
can't really get much of anything done 
which the president does not want to 
sign, other than by constitutional 

amendment" 

Senator Jesse Helms, the arch-conser- 
vative in line to take over Che foreign 
relations committee, promised deep cuts 
in foreign aid. not excluding US contri- 


butions to the UN - for years the object 
of his. discontent- - and Nato. 

Mr Gingrich also warned, only half- 
jo kingly, that the Republicans could 
now frustrate the president in other, 
ways. Senator Robert Dole, as majority 
leader, could control every appointment . 
Mr Clinton sent up for ratification, he 
said. 

The president WmsMif drew his own 
line in the sand at his Wednesday ' elec- 
tion postmortem, in which he promised 
to work with the new Republican major- 
ity In Congress, but not to the point of of 
permitting a return to file economic poli- 
cies of the 1980s. 

Mr CBntoh humorously acknowledged 


the force of some Republican positions 
in the wake of Tuesday's landslide, 
fai prising ihniftw on the number of terms 
members of Gongress may serve, he said 
with a smfle . "looks batter to me every 
day". ' . 

Other prominent Republicans could 
not resist attacking the president Mr 
William EristoL a leading party strate- 
gist dose to Mr Gingrich, said Mr Clin- 

tOEQ should publicly confess the error of 
his ways over the last two years and 
fully admit responsibility for the biggest 
Democratic party debade in GO years. 

Further reports and analysis. Page 4 
Editorial Comment, Page 15 




FT-SE 100: 2,1055 (+35) 

Yield . . ._4.lt 

FT-SE Euratra* 1D0 _1,34&32 (438) 

FT-SE -A AB-Stare .1,54093 W).1%) 

KW«i 19*64*5 (-159.03) 

Hag York riiinliffmr 

Dow Jama M Aw 3,84049 1*8.74) 

S8P Qroposte 46531 t«d49) 

■ OS LUNCHTHE RATES 

New Vtorfc (uncNkne: 

S 1-5995 

London: 

S 1-5968 (1.6036) 

DM 2.4506 (2.4534) 

Wr 84225 (8.4335) 

SFr 23542 (2.0542) 

Y 156545 ((55511) 

EMn 854 (BOQ 

■ DOLLAR 

Federal Fuads: 

3-an Traas B9s YU -A342K 

Long Bond 95ft 

YteJd 5091% 

■ LONDON MONEY 

New Ybrk (uncWiraa: 

DM 1533 

FFr 5264 

SB 1288 

Y 9753 

London: 

DM 15348 (1.53) 

52748 (5259$ 

SFr 12865 0-281) 

Y 9854 (97.79) 

S index B15 (61.7) 

Tokyo dosaY 97.77 

3-on Hobart (B%%) 

UflB tone gB future: __Dw 101ft (DeclOI S3 

■ NORTH SEA OIL tMm) 

Brent 15-43Y (Dec) 917.17 (1734) 

■ GOLD 

New Yorik Onex (Ded —33853 (384.5) 
London S3842S (384.4) 

Asm SJffl Qkqs Df3S0 Mrta LrtOiO Qatar OR HOC 


Sears spins 
off Allstate 
insurance 
subsidiary 


By Laurie Mona in Chicago 

Sears, Roebuck, the US retailing 
giant, is to distribute its 80 per 
cent stake in Allstate Insurance 
to its shareholders in one of the 
largest ever US corporate spin- 
offs, valued at more than SS^bn. 

The move completes a two-year 
restructuring that has changed 
the Chicago-based group from a 
diversified merchandising and 
financial services conglomerate 
back to being a pure retailer, 
which is how it began. 

The company also announced 
yesterday that Mr Edward Bren- 
nan, aged 60, who has been Sears' 
chairman since 1986, is to retire 
when the Allstate spin-off is com- 
plete. The restructuring was 


Lex Page 16 

Hit by earthquake — Page 19 


started reluctantly by Mr Bren- 
nan under pressure from share- 
holder activists. 

He has recommended that Mr 
Arthur Martinez, aged 50, the 
popular chairman of Sears' mer- 
chandising group, should succeed 

him- 

Sears plans to distribute its 
remaining 360m shares in 
Allstate, one of America's leading 
property-casualty insurers, in a 
tax-free distribution to sharehold- 
ers in mid-1995. 

Sears sold an initial 19 per cent 
of Allstate's shares in a public 
flotation last year. It founded the 
insurance company in 1931 to sell 
auto insurance through Sears' 
catalogues and stores. 

Last year Sears also sold Dean 


Witter Reynolds, the brokerage 
firm, and its property company. 
Cold well Banker. Earlier this 
week the group disposed of its 
namesake Sears Tower in down- 
town Chicago to a gro up of mort- 
gage holders, escaping from 
5850m tn debt 

Sears said it was also consider- 
ing spiling its commercial prop- 
erty arm, Homart next year. The 
business had 1993 revenues of 
$234m and losses from continuing 
operations of $lL4nL 

Yesterday's announcements 
lifted Sears' share price by $2% in 
morning trading on the New 
York Stock Exchange, to 951%, 
while Allstate dipped 9% to 924%. 

Shareholders will be given 
details of the spin-off next spring, 
but Sears arnimim shareholders 
seem likely to receive almost one 
share of Allstate stock for each 
Sears share. 

The company intends the 
aggregate dividends paid by 
Allstate and Sears after the 
spin-off to equal Sears' current 
annual dividend of 9L60- 

"Sears and Allstate are ready, 
and the economic environment is 
right, for these successful Ameri- 
can franchises to operate as inde- 
pendent companies, " said Mr 
Brennan. 

Last year Allstate contributed 
$14bn to the Sears group’s $1.7bn 
of earnings. But Allstate's bottom 
line has been shattered by $L3bn 
in customer claims for earth- 
quake losses this year, resulting 
in 9845m in after-tax charges. Its 
net income for the first nine 
months of 1994 was 9320.7m, or 71 
cents a share, down shandy from 
last year’s $Lbn or 93.42 a share. 



King Hussein of Jordan, right, on his first public visit to Israel, talks to prime minister Yitzhak Rabin at Tzemada, on the shore of the Sea of 
Galilee, after exchanging ratified copies of the Israel-Jordan peace treaty wHclrtitey signed last montfa . nm ap 


Shooting halts IRA prisoner releases 


By John Murray Biiown fn Dublin, 
DavkJ Owen, Jonray Bums and 
Stewart Da&y 

The Irish government yesterday 
abruptly rescinded, the planned 
release of nine IRA prisoners 
before Christmas after two prom- 
inent republicans were arrested 
in Northern Ireland following the 
murder of a post office worker in 
an armed raid. 

The fatal shooting, the first 
since the IRA and Loyalist para- 
militaries declared ceasefires in- 
September and October, cast a 
shadow over the Northern 
Ireland peace process, ft is cer- 
tain to increase pressure cm Lon- 
don and Dublin to step up their 
efforts to secure a dismantling of 
pa ramilitar y arsenals. 

Dublin's decision to cancel the 
early release orders for the IRA 
prisoners was announced by Mrs 
Maire Geoghegan. the Irish jus- 
tice minister, after a meeting 
with Mr Albert Reynolds, the 


Irish prime minister _ 

It came more than 24 hours 
after their release was first 
announced as part of the Irish 
government’s response to the 
ceasefire. 

Sir Patrick Mayhew, Northern 
Ireland secretary, said he was 
"deeply angered" by yesterday's . 
"callous ami wicked” murder. 

He said there would be "very 
natural suspicions" as to the 
motive for the crime. The full cir- 
cumstances would be rigorously 
investigated by the Royal Ulster 
Constabulary. It demonstrated. 


, he added, “tte wantbn c&Ogers of 
illegaBy-heidanns^v.-' 

The attack took place in 
Newry. Threearmed men dressed 
as postmen^ and. using a post 
office van, entered a fenced sort- 
ing centre In the town. An 
employee was shot dead. Two of 
the men were arrested after a 
chase Involving helicopters close 
to the Irish border. The third 
escaped and was last night being 
sought by the RUG. 

The RUC said the two men 
arrested were reported to be 
known Republicans. But Sinn 


F&n indicated last night that the 
raid was not the work of the IRA 
and did not represent a breach of 
the two-month-old ceasefire. 

Republican sources in South 
Armagh, a strong nationalist 
area, said the raid was the work 
of renegade, freelance republi- 
cans committing a -straightfor- 
ward criminal act 
Mr Gerry Adams, the president 
of Sinn Fein, was reported to be 
"visibly shaken" when told tire 
news. He said: "The RUC is 

Continued on Page 16 


Russia set to impose HIV 
tests on foreign visitors 


By Chrys&a Freeland h Moscow 

Foreigners mitering Russia will 
be required to undergo HIV tests 
at the border or produce medical 
certificates showing they have 
not been exposed to the Aids 
virus, under legislation Moscow 
is expected to adopt soon. 

A western diplomat said yester- 
day the European Union, US, 
Canada and Japan were consider- 
ing a joint appeal to President 
Boris Yeltsin to urge him to veto 
the legislation. It would be the 
toughest law of its kind to be 
adopted by a large and influential 
country and could discourage 
business travellers and tourists. 

Western diplomats are con- 
cerned about the technical diffi- 
culties Russian border officials 


HIV tests in Russia, where nee- 




However, it will be difficult if 
not impossible for Mr Yeltsin to 
block the measure. 

Officials at the parliamentary 
commission on health, which pro- 
duced the draft law. said they 
were confident that the bill, 
which is scheduled for a third 
reading in the State Duma either 
today or next week, would be 
passed by the lower house. 

It would then need to be 
endorsed by the Federation Coun- 
cil the upper house, and signed 
by Mr Yeltsin. A presidential 
veto could be overruled by a two- 
thirds vote in the Duma, which 
parliamentary officials are cer- 
tain they could muster. 

The legislation, which in Its 
second reading was opposed by 
only* three of the 450 deputies in 
the Duma, has found reluctant 
supporters among Russian liber- 
als. They fear that the nation's 
collapsing healthcare system is 
too weak to protect the country 
against diseases which are a 
malign side-effect of growing con- 


CONTENTS 


tacts with the rest of the 
world. 

Ms Svetlana Ulitskaya, the 
chief expert at the parliamentary 
commission on health, said "We 
have an unpleasant choice. 
Either we can be civilised and let 
Aids into our country or we must 
look uncivilised and close the 
door." 

Mr Valerii Mestnikov, annthwr 
health commission official said 
the Russian public were uncon- 
cerned about the potential dam- 
age the law might do to western 
investment and tourism: "The 
attitude of the people is that they 
haven't seen any positive results 
from western investment any 
way, so the law couldn't make 
any difference.” 

According to Professor Richard 
Clogg, a fellow at St Antony’s 
College, Oxford, Russia more 
than a year ago began to require 
all travellers from the embattled 
Black Sea enclave of Abkhazia to 
undergo an HIV test at the Rus- 
sian border. 



Hnpy. 


© THE FINANCIAL TIMES LIMITED 1994 No 32.521 Week No 45 LONDON - PARIS - FRAHKFUBT - HEW YORK - TOKYO 


"You expect 
us to invest 
in bottling 
water that comes 
straight out 
of the ground? 

Eau-no Monsieur 


Having the capital to back a big idea is only half the secret. 
Having the vision to spot one is the other half. 



The Clear Advantage . 


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FINANCIAL TIMES FRIDAY NOVEMBER ! 1 1994- 


Portuguese diplomat to head WEU 


By Bruce Claric, Diplomatic 
Correspondent 


Mr Jose Cutileiro, a senior 
Portuguese diplomat whose 
candidacy enjoyed the support 
of Britain, was appointed yes- 
terday to the top job at the 
Western European Union, a 
nine-nation security club of 
growing Importance. 

The choice of Mr Cutileiro, 
59, who joined Che Portuguese 
foreign ministry after Lisbon's 
democratic revolution in 1974, 
marked a success for London’s 
drive to boost Europe's 
defences in a way that avoids 
weakening Nato. 

Yesterday's choice of secre- 
tary general, taken by a meet- 
ing of ambassadors in Brus- 
sels, win be formally endorsed 


when WEU foreign and 
defence ministers gather at 
Noordwuk in the Netherlands 
on Monday to discuss ways of 

upgrading the organisation. 

Two rival candidates - the 
Italian ambassador to Nato, 
Mr Giovanni Jannnzzl, and Hr 
Enrique Baron Crespo, a Span- 
ish Socialist politician - 
stepped aside after initial 
soundings showed that Ger- 
many had swung behind Mr 
Cutileiro. 

France - the strongest advo- 
cate of an independent Euro- 
pean defence capacity - ini- 
tially backed Mr Jannuzzi but 
gave away after the Germans 
opted for the Portuguese can- 
didate, who already enjoyed 
UK and Dutch backing. 

Diplomats said the two 


unsuccessful candidates had 

decided not to insist on a 
definitive vote which would 
have damaged the fledgling 
institution’s credibility. 

“It would have looked bad if 
somebody had won in defiance 
of several major countries.” 
one di plom at commented. 

The WEU is already involved 
in naval operations to enforce 
the international embargo 
against the former Yugoslav 
republics, and it is also setting 
up a police force in the divided 
city of Mostar. 

But its role - hitherto 
dwarfed by Nato - Looks cer- 
tain to grow as the US par- 
tially disengages from Europe 
anrf the European Union devel- 
ops a common foreign and 
security policy. 


Britain has set aside its ear- 
lier doubts about tbe organisa- 
tion, and it now sees the WEU 
as a useful way of developing 
defence relations with its con- 
tinental allies, including 
France which is outside the 
military wing of Nato. 

Mr Cutileiro - who won 
acclaim in his homeland by 
writing a doctoral thesis at 
Oxford University on inequal- 
ity in southern Portugal - will 
have to bridge tbe gap 
between French zeal and Brit- 
ish caution over upgrading the 
WEU. But he comes up from a 
country whose views on Euro- 
pean security overlap consid- 
erably with those of the UK. 

Both Britain and Portugal 
want to avoid creating fissures 
in eastern Europe by rushing 


to draw some ex-communist 
states into tbe western secu- 
rity system while keeping oth- 
ers out “We should not draw 
new lines in Europe," Mr Jose 
Manuel Dnrao Barroso, the 
Portuguese foreign minister, 
said in London last week. This 
viewpoint is broadly shared by 
France, while it has some crit- 
ics in Germany. 

British and Portuguese offi- 
cials are also adamant on the 
need to retain a US military 
presence in Europe, and to 
avoid moves that would alien- 
ate Washington. 

Both countries oppose the 
idea of giving new members of 
the EU a “back door” into the 
western defence structu re b y 
letting them join the WEU 
before they join Nato. 


Bosnian Serbs 
wary of move 
to state of war 


- .i__. <S - 


By Paid Adams in Pale, Bosnia 


With artillery fire occasionally 
audible in the distance, repre- 
sentatives of tbe Bosnian Serbs 
have gathered in this impover- 
ished mountain resort to con- 
sider how much freedom of 
action to give their leader, Mr 
Radovan Karadzic. 

Yesterday, after two days of 
debate behind firmly closed 
doors, It was clear that the 
Bosnian Serb “parliament" 
would stop well short of declar- 
ing a state of war throughout 
their territory in Bosnia, or 
suspending their own 
assembly. 

Mr Karadzic - facing mixed 
fortunes on the battlefield, a 
boycott by his former protec- 
tors in Belgrade, and isolation 
from the wider world - would 
ideally like to be given carte 
blanche to wage all-out war. 

But fearing a dilution of its 
authority, the makeshift 
assembly in Pale, above Sara- 
jevo, has forced Mr Karadzic to 
limit tbe scope of any declara- 
tion of emergency rule to those 
areas most immediately at risk 
from the latest fighting. 

Officials here say the formal 


state of war will only apply to 
some 50 per cent of Serb-con- 
trolled territory. 

“Of coarse, you can always 
expect resistance,” said an offi- 
cial close to the Pale leader- 
ship. “People got scared by an 
this talk of declaring war. But 
we have to prove to the Mos- 
lems that they cannot win." 

Prying journalists were kept 
at arms length at tbe orders of 
the ever-vigilant Ms Sonja 
Karadzic, daughter of the Bos- 
nian Serb leader. 

Mr Karadzic said before the 
debate continued yesterday 
that he would assume certain 
decision-making powers from 
parliament, but insisted there 
was no question of the assem- 
bly being dissolved. 

As the Serbs come under mil- 
itary pressure he needs to take 
care. Parliament has often 
been dismissed as a rubber 
stamp for the Bosnian Serb 
leadership, but it does repre- 
sent Mr Karadzic's link with a 
population, part of which is 
not always necessarily behind 
him 

He canno t afford to be seen 
to be ignoring the interests of 
the representatives. Officials 



Vi 




Relatives at a funeral in Sarajevo yesterday comfort the father of a child killed by shelling %• a 


admit that absenteeism and 
black marketeering. sometimes 
across enemy lines, have 
resulted in militar y weakness. 

The new measures will 
include more efficient mobili- 
sation - something that has 
already begun - restrictions on 
the movement of civ ilians and 
the introduction of martial 
law. Local government will be 
concentrated in the hands of 
small groups of officials, 
directly answerable to Mr 
Karadzic. “It will not be a clas- 
sic state of war. but a semi- 


state of war,” the Bosnian Serb 
“foreign minister", Mr Aleksa 
Buha, said. 'This is a very seri- 
ous decision. We don't want to 
do it too fast” 

Punishments for desertion 
and dereliction of duty are 
likely to be toughened. 

On Wednesday, Mr Karadzic 
said a number of brigade com- 
manders responsible for losing 
territory near the north-west- 
ern enclave of Bihac had 
already been replaced for faff- 
ing to obey orders. 

Since Serbia severed rela- 


tions with the Bosnian Serbs in 
August. Mr Karadzic has con- 
ducted periodic purges of the 
army and police, aimed at root- 
ing out those who might not 
think twice about taking their 
orders from Belgrade. An offi- 
cial in Pale said the dfemiagak 
were "a normal consequence" 
of the breakdown in relations. 

But it is clear that the Bos- 
nian Serb leader’s personal 
feud with President Slobodan 
Milosevic has led him. rightly 
or wrongly, to suspect those 
around him 


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Gesc bafts fa hrer and in London b? 
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avia) Ltd. Vimmelskafted 42A, 
DK-M6I Copenhagen IL Telephone 33 
13 44 41, Fax 33 93 33 35. 


Mr Giuliano Amato, the former 
Socialist premier, has been 
appointed to head Italy’s 
five-man anti-trust 
commission, the ultimate 
arbiter of any conflict of 
interest between the role of Mr 
Silvio Berlusconi as prime 
minister and his ownership of 
the Fininvest financial and 
media empire. 

This is the first time the 
six-month-old Berlusconi 
government has offered a 
sensitive appointment to an 
opposition figure, and the 
move has divided the 
rightwing coalition. 

But, given the unresolved 
conflict of interest between Mr 
Berlusconi’s political and 
business roles, the move is a 


clear attempt to recover 
credibility. It represents a 
move by moderates in the 
government to bring tbe 
coalition towards the middle 
ground and pave the way for 
an alliance with centrist 
parties in the opposition with 
whom Mr Amato identifies. 

Significantly, the choice of 
Mr Amato to head the 
anti-trust commission follows 
the serious divisions within 
the rigbtwing coalition caused 
by the refusal to nominate Mr 
Giorgio Napolitano. previous 
speaker of the chamber of 
deputies and a member of the 
former communist Party of the 
Democratic Left (PDS), as one 
of Italy's two new European 
commissioners. 

The decision to appoint Mr 
Amato was formally taken by 


Ms Irene Pivetti, the speaker of 
the chamber and member of 
the populist Northern League; 
but it was backed by Mr 
Berlusconi. Yesterday, the 
move was criticised by the 
neo-fascist MSI/National 
Alliance as well as by 
individual members of the 
league and Mr Berlusconi’s 
Forza Italia movement 
The appointment comes at a 
time when the government 
finds itself running into 
increasing problems of conflict 
of interest over the 

management of the Rai, Italy's 
troubled state broadcasting 
organisation.; On Tuesday, the 
government approved the 
summary removal of Mr 
Gianni Billia, brought in only 
95 days ago to be 

director-general of the Rai 


alongside Mrs Letizia Moratti, 
the new chan-man. 

Mr Biilia felt uneasy about 
Mrs Moratti's management 
style and the choice of 
programme and channel 
managers, several of whom 
had links to Mr Bettino Craxi, 
the former Socialist leader. 

He also fell out over Mrs 
Moratti’s plans to sell off some 
of the Rai's transmission 
facilities which threaten to 
weaken the role state 
television could play in 
developing multimedia 
activities - and benefiting Mr 
Berlusconi's three commercial 
channels that account for 
almost half the national 
television audience. At least 
one other Rai board member 
has resigned and others could 
follow. 









ti 










tZ 


Gonzalez 
backed on 
favouritism 
allegations 


By Tom Bums in Madrid 




Now. a H 1993 issues of the Neue Zurcher Zeitung - Switzerland's globally respected daily - are available on one CD-ROM 

Wltni n cAi^Anrle tUa f.itl l... .J . _ . _ . 


With;** . . - r m P * r v uiuuuuib VII line 

within seconds, the full-text search feature by keyword, title, author, section or issue retrieves articles and displays them 

on your screen. In the convenient A4 format and with no changes versus the printed edition whatsoever. For details -JUrClHT ^>flUUUl 

contact: Neue Zurcher Zeitung, CD-ROM, Falkenstrasse 1 1, 8021 Zurich. Tel. +41 (01 ) 258 13 22. Fax +41 (01 ) 258 13 "*8 ~ ■ - - 


ON CD-ROM 





EUROPEAN NEWS DIGEST V* 


Yeltsin aide 
attacks budget 



Mr Felipe Gonzalez’s minority 
government yesterday won the 
support of its Catalonian and 
Basque political allies against 
allegations that the Spanish 
prime minister had favoured 
the business dealings of his 
brother-in-law. 

Leaders of the Catalan and 
Basque nationalist parties, 
whose votes keep the ruling 
Socialist party in power, 
endorsed the prime minister 
and accused the opposition 
conservative Partido Popular 
of seeking to make political 
capital out of false corr up tion 
allegations. 

In an unprecedented cross- 
fire of accusations and denials, 
the Madrid newspaper El 
Mundo has been printing front 
page stories connecting Mr 
Francisco Palomino, a Seville 
businessman married to Mr 
Gonzalez's sister, to govern- 
ment contracts, and on a daily 
basis the prime minister’s 
spokesman has issued lengthy 
rebuttals of El Mundo’s allega- 
tions. 

Tbe newspaper alleges that 
Mr Palomino sold a bankrupt 
boffermabing business owned 
by his family at a considerable 
profit to a company that sub- 
sequently hired him as a non- 
executive director and was 
engaged by the government to 
install electronic s yst e m s in a 
nuclear-proof bunker built 
alongside Mr Gouzflez’s offi- 
cial residence. 

The allegations have been 
attacked as “falsehoods" in a 
succession of statements 
issued by the prime minister's 
office and they have been 
called a “pack of lies” by Mr 
GonzAlez. “I have never shown 
favouritism, nor do I intend 
to, nor have I ever been asked 
to," said the prime minister. 

Ur Jordi Pujol, the Catalan 
nationalist leader, pledged to 
continue supporting the 
Socialist party becanse it bad 
won the 1993 elections and in 
order to ensure the “govema- 
bility" of the nation. Mr Pujol, 
whose executive in Catalonia 
also faces a series of corrup- 
tion scandals, some of which 
are Hnkwd to jailed Barcelona 
financier Mr Javier de la Rosa, 
said he opposed the PP 
because the conservatives 
were unsympathetic to Cata- 
lan authonomy and lacked 
alternative policies to those of 
the government 

Mr lii alri Anasagasti, the 
parliamentary spokesman of 
the Basqne nationalists, 
accused the conservative oppo- 
sition of “bnllv boy tactics” 
for backing El Mundo’s allega- 
tions and said he stood by tbe 
“honesty of Felipe Gonzdlez". 

The endorsements by the 
government's political allies 
suggest that the PP, who 
scared an outright victory 
over the Socialist party in 
June’s European elections and 
maintain a 10-point lead in 
opinion polls, are no nearer 
unseating Mr Gonzfilez. But 
the jury is out on whether the 
prime minister, who last night 
was doe to address the nation 
to a TV “fireside" chat, has 
won the propaganda battle 
with tbe public over his credi- 
bility. 


The battle between President Boris Yeltsin and his ;prime 
minister, Mr Victor Chernomyrdin, which, has been waged 
through proxies over the past week in a prolonged cabinet 
shuffle, was stepped up yesterday when a senfor presidential 
adviser attacked Mr Chembmynfin's austere 1996 budget Mr 
Alexander Livshits, a recently appointed Yeftsin adviser who 
was described by one Russian newspaper yesterday as more 

infliiwitial thaw any m r n iri w , fold a JBXSS iw n (!www» 

yesterday that the budget was too tough 

“The price of implementing such a budget will be too high," 
Mr Livshits said. Tdont think the end justifies the means.” 
Mr Livshits criticised the government's proposal to -put a 
moratorium on the soft central bank credits which pished the 
monthly inflation rate op to IS per cent In October. He said 
the government’s plan to raise money through bonds, which 
have recently experienced pom* demand despite rapidly rirfr^g 
prices, was unrealistic- Mr Uvshits said long-term plans: to 
slash inflation to western levels wee upreafisfic. “I- see no 
reason why we should not have 15 to 20 per cent inflation a 
year in the next few years,” he said. 

When the cabinet endorsed it last month, the austere budget 
was hailed as a sign that Russia was at last prepared to 
swallow the tough fiscal and monetary medicine which has 
turned around the economies of eastern Europe. But it could 
be derailed by Mr Yeltsin’s covert criticisms and. the .even 
staffer resistance it is expected to face when it is presented to 

parliament later this year. Chrystia Freeland. Moscow 






V " 

K*?: .. .. 1 


+ > * • 




Polish defence minister sacked - 


President Lech Walesa of Poland yesterday sacked Mr Piotr 
Kolodziejczyk, defence minister, at the request of Mr Walde- 
mar Pawlak, the prime minister. The dvoniwwl of Mr Kcftod- 
ziejezyk - a 55-year-old retired navy .admiral who has been 
defence minister since the new leftist government was framed 
a year ago - follows a conflict between the civilian minister 
and the military over spending, reforms and control of the 
army. President Walesa had asked Mr Kolodziejczyk to resign 
after military officials criticised the minister during a m a uli ng 
at a battlefield in Drawsfco Pomorskie on September 30 l The 
minister had refused and had the backing of parliament in 
what was seen as a struggle between the president and the 
cabinet over control of the military. However, Mr Pawlak 
yesterday unexpectedly wrote to the president requesting hfs 
dismissal Mr Pawlak said Mr Kolodziejczyk had foiled to 
“normalise the situation in the dateline ministr y*- The move 
cranes two days after Mr Joseph Kruzel the US deputy assis- 
tant defence secretary, gave Ids hanking to the minister on a 
visit to Poland. AP. Warsaw 




3-S- 1 ' • - 


Danes pick woman bank chief 


m 


I Mrs Bodil Nyboe Andersen 

has been appointed to suc- 
ceed Europe’s longest serving 
central bank governor Mr 
Erik Hoffmeyer when he 
retires after three decades as 
head at Denmark's National 
Bank on January 1. Mrs 
Nyboe Andersen (left). 54, 
c ur rently an the board of gov- 
ernors, is not expected to 
change bank policy. Her 
appointment wiH brim* to five 
the number of women central 
bank governors in Europe. 
Woman are already hr charge 
■ in Finland^ Austria; Russia 
and Poland. Mrs Andersen is 
the daughter of a former 
economy and trade minister and has been lecturer in econom- 
ics at Copenhagen University. She was a member of the board 
of Andelsbanken h ank and then Unibank before joining the 
central bank in 1990. Mr Hoffineyer has been governor for 90 
years and win leave the bank with the economy in good shape. 
Wary Barnes, Copenhagen 
Observer, Page 15 


rns • *• •• 
:r-.: 


Hag law angers Hungarians 


Ethnic Hungarians in Romania yesterday criticised a new law 
which provides for up to three years’ jail for those flying 
foreign flags or singing foreign anthems in the ethnically 
mixed Balkan state. MPs from the ethnic Hungarian, party said 
the provision, passed by parliament on Wednesday, was anti- 
democratic and violated European ethnic rights agreements. 
They said they would appeal to the country's c on s t it uti onal 
court and to the Council of Europe. Parliament’s decision is 
the latest sign of the growing influence of nationalist politi- 
cians who formally joined the left-wing minority government 1 
in August. It comes as the Senate, the upper house, is prepar- 
ing a bill which would require foreignss to register with the 
police within 48 hours of arriving in Romania It would also 
empower the interior ministry to restrict foreigners’ move- 
ments on grounds such as national security and “public 
morale”. Virginia Marsh. Budapest 


Thomson denies radar claims 


Thomson-CSF of France yesterday denied all egations that in 
tbe course of winning its recent contract to supply Austria 
with 22 radars worth SchiJibn ($U2m) ft had tried to bribe a 
member of the governing Social Democrat party. The Austrian 
defence ministry confirmed that the Vienna prosecutor's office 
had been asked to investigate allegations in yesterday's edi- 
tion of the weekly “News” that Thomson-CSF’s local represen- 
tative had offered a Sch22m bribe to a Social Democrat official * 
who reftised the offer and informed the party's haad , Chancel - 
lor Franz Vranitzky. The ministry said the award of the 
contract to the French electronics company, with Steyr as its 
local partner, was because its radars were “dearly superior” 
to those of the rival consortium of Ericsson of Swedea- and 
Sc brack of Austria. David Buchan, Paris 


ECONOMIC WATCH 


French inflation stays low 


Annual % change Irt CR . 

3-5- - - - 


3.0 /—V — 


2J» -V - 


1.5 


i French consumer prices rase 

France: Inflation ; by between 0.2 per cent and 

. ... . ’ . _ ■ 05 per cent last month, giv- 

Atnual % change hvCPf . . . ing a relatively stable anrmal 

3 -5 ■ ' " t — inflation rate of just under 1.7 

- - ■ ’ per cent, according to (wane, 

a.o /-V the national statistics office. 

\ The monthly rise. In hue with 

\_ expectations, reflected an . 

v ' ' * ' increase in prices for fresh 

Ta A • . foods. Most other sectors. 

2.0 *'Y V — ; including • manufactured 

; goods and public sector ser- 

■,.5 f_V vices, showed a dower rate of 

increase than in October 1993. 

. _i :i The release of the inflation 

1.0 ■ statistics coincided with an 

■ fnsee survey which showed a 

source: catBstraam small decline in Ftanch' con- 

sumer confidence last month. Officials said Hi» decline 
reflected increased concern about the persistence of high 
unemployment, despite broader flwwtnmte recovery, hi Septem- 
ber, unemployment Increased by 14000 to a record high ctf 
&35m, or 12.7 per cent of the workforce. John Bidding, Paris 

■ Russia's economy showed the first signs of rebound in three 
years last month, with gross domestic product growing 4 per 
cent from October 1993 after falling 14 per cent year-on-year in 
September. Last year, GDP contracted by 12 per cent - 

■ German retail sales in September rose a real 1 per cent from 
August, but year-on-year they were down 1 per cent 

■ Norway's consumer prices rose a stable 1.7 per cent in 
October year-on-year. 





1992 93 

Sourcw Datastreanr 














FINANCIAL TIMES FRIDAY NOVEMBER 1 1 1994 


3 


ie 



. . ?£ 
- - 

: : in 

7- :- s 




NEWS: EUROPE 


Strasbourg 

delays 


Swedes reminded Quisling was pro-Europe 

Hugh Carnegy sees the No campaign resort to theatre of the absurd as Sunday’s EU referendum remains a tight race 


change of 
guard in 
Brussels 

By Lionel Barber and David 
Gardner in Brussels 

The European parliament has 
forced a delay in the inaugura- 
tion of the new European Corn- 
mission until late January, it 
emerged yesterday. 

The delay means that Mr 
Jacques Delors will lead a 
caretaker regime probably 
until the last week of January, 
some three weeks after he was 
due to step down as Commis- 
sion president 
One unexpected result is 
that he will have a cast-iron 
excuse Tor remaining silent 
about whether be intends to 
ran for the French presidency 
in late spring. Most observers 
believe this will help Mr 
Delors, whose high standing in 
the polls is attributed partly to 
his absence from an increas- 
ingly messy battle for the 
Elys^e. 

The immediate impact how- 
ever, is that next week’s 
planned Euro-parli amentary 
bearings to screen Che new zi- 
member Commission are to be 
postponed until the first two 
weeks in January. 

The Strasbourg assembly is 
expected to vote on whether to 
approve the full Commission, 
including Mr Jacques San ter, 
the new president, on January 
IS. 

The bold-op is the result of a 
Judicious muscle-flexing exer- 
cise by Mr Klaus Hfinsch. 
the new president of the 
assembly. 

It underlines his determina- 
tion to use the leverage over j 
the Commission and the mem- j 
her states offered by the Maas- 
tricht treaty, one of whose 
powers is to give Strasbourg 
the right to approve or reject 
the Commission as a whole. 

During legal exchanges, the 
parliament insisted that the 
new Commission must be 
endorsed by an assembly 
drawn from all member states, 
including Austria, Finland, 
Sweden, and Norway. 

AH four countries are due to 
enter the European Union on 
January i, assuming that vot- 
ers in Sweden and Norway 
approve EU membership In 
referendum this month and. 
the accession agreements are 
ratified by all 12 member 
states. 

The parliament argued suc- 
cessfully that MEPs from Aus- 
tria and the three Scandina- 
vian . states -- who are 
temporarily designated by 
their national parliaments 
pending' Euro-par liamentary 
elections scheduled for next 
year - would have no legal 
status until January 1 when 
enlargement takes place. 

The hold-up is something of 
a blow to Mr Santer who had 
hoped to get off to a fast start 
with the new five-year Com- 
mission. Late last month, 
against expectations, he 
succeeded in allocating portfo- 
lios to the new commissioners 
with a minimum of contro- 
versy. 

More broadly, the parlia- 
mentary delay is part of an 
institutional logjam which 
also threatens to delay ratifi- 
cation of the EtTs five-year 
budget 

Member states were doe to 
enshrine the spending plans 
into domestic law by the end 
of the year, but a combination 
of. weak governments and 
political opposition In national 
legislatures - could hold up 
passage. 


A ctivists for the No cam- 
paign. buoyed by opin- 
ion polls showing them 
within sight of victory in Swe- 
den's referendum on Sunday 
on European Union member- 
ship. were pulling few punches 
when they mounted a gala 
evening for undecided voters 
in Stockholm’s City Theatre. 

One after another, perform- 
ers of “The People’s Movement 
against the EU M invoked 
alarming images to press their 
case. One quoted from Vidkun 
Quisling, the hated Norwegian 
wartime leader who co-oper- 
ated with the Nazis (most Nor- 
wegians consider neutral Swe- 
den did likewise), to show he 
favoured European integration. 
Another sang powerfully at the 
gala last Sunday of Nadja, a 
child victim of war in Sarajevo, 
linking her fate to “ the new 
Europe". 

Claes Fredelius, a member of 
a Marxist group, went furthest. 
His indictment of the EU. 
traced back to Europe's mur- 
derous colonisation of the 
Americas, included a reference 
to the recent Estonia ferry 
disaster in which more than 
800 Swedes perished. The con- 


By Judy Dempsey hi Be r l in 

As befits his age, Mr Stefan 
Heym walked slowly up to the 
podium of the Reichstag in 
Berlin yesterday. Aged 81, the 
doyen of east German writers 
had been given the privilege of 
delivering the opening speech 
of the new German parliamen- 
tary session, as the oldest of 
the 672 deputies elected to the 
Bundestag last month. 

The walk to begin his 
address was heavy with the 
symbolism and bitterness of 
Germany's division and subse- 
quent reunification. 

Mr Heym fled Nazi Germany 
as a Jewish refugee, fought on 
the side of the Americans 
against his country during the 
second world war, and 
returned to east Germany In 


nection to the EU was unclear, 
but the message was not: The 
EU Is today's evil empire 
which threatens to trample 
Sweden's superior but fragile 
jWfr hem (people's home). 

At its most extreme, the No 
campaign presents a mad- 
dingly difficult target for Mr 

‘I think people 
are scared of the 
EU. They think 
Sweden will be 
too small inside’ 

Ingvar Carlsson, the Social 
Democratic prime minister, his 
allies (on the EU issue) in the 
right-of-centre opposition and 
the country's industrial and 
trade union leaders, despite 
their dominant position on 
Sweden’s political heights. 

The pro-EU message that 
membership will help stabilise 
an economy shaken by reces- 
sion and give Sweden its share 
of influence in a reshaped 
Europe sounds at best mun- 
dane and at worst defeatist 


1952, disillusioned with the 
McCarthy witch-hunts. The 
communist regime tolerated 
him as its most truculent 
writer, but refused to publish 
his increasingly critical novels. 

But Mr Heym is an indepen- 
dent deputy backed by the 
reformed communist Party of 
Democratic Socialism (PDS), 
and thus an enemy of the 
country's conservative govern- 
ment Not surprisingly, hours 
before he was due to speak, 
Mrs Rita Sflssmuth, Bundestag 
president, received a letter 
from Berlin’s Central Investi- 
gating Office alleging Mr Heym 
had given the Stasi - the for- 
mer East German secret police 
- information about an east 
German trade unionist who 
had fled to west Berlin but was 
subsequently kidnapped by the 


against the No side’s appeal to 
preserve the traditional lofty 
Swedish ideals of neutrality, 
egalitarianism and universal 
welfare that were so long 
championed by Mr Carlsson’s 
Social Democrats. 

The old system may be 
creaking - with unemploy- 
ment running at more than 13 
per cent of the workforce and 
the welfare system threatened 
by a huge budget deficit equal 
to 13 per cent of gross national 
product - but many Swedes 
are still reluctant to accept 
that it cannot be made to work 

again 

Nor is there the same 
potency in Sweden, which has 
no border with Russia, to the 
worries about future develop- 
ments in Moscow that helped 
produce the Yes vote in neigh- 
bouring Finland last month. So 
people hesitate to take a step 
that is seen as an irreversible 
move away from the “Swedish 
model”. 

Mr Tomas Segenas, who runs 
a small lunchtime cafe in 
Stockholm, is one of those peo- 
ple. T think people are scared 
of the EU.” he said this week. 
“They think Sweden will be 


Stasi in the 1950s. Mr Heym 
said he bad never knowingly 
given the Stasi information. 

It was a grim Reichstag that 
waited For him to begin speak- 
ing. He asked for greater 
understanding and unity 
between east and west Ger- 
mans but dwelt, embarrass- 
ingly, on the past. "I have 
always asked why the euphoria 
of German unification has 
gone so quickly," he said. 

“The people of east Germany 
freed themselves. But there 
were people who had weapons 
to defend the old. unloved sys- 
tem. They did not use these 
weapons. We should take this 
into account when we judge 
them,” he said, making an 
implicit plea for a partial 
amnesty for those accused of 
collaborating with the Stasi. 


too small inside the Union. Yes 
- they are afraid that Sweden's 
way of living will be changed.” 

No-one is more conscious of 
this feeling than Mr Carlsson, 
who inherited the leadership of 
the Social Democratic party in 
1986 from the late Mr Olaf 
Palme, the very embodiment of 
the Swedish model. Only in 
1991 did Mr Carlsson overturn 
decades of Social Democratic 
orthodoxy by lodging Sweden's 
application for membership. 


B ut the persistent suspi- 
cion of the EU among 
Social Democrats - 
recent polls suggest fewer than 
half the party's supporters are 
convinced Yes voters - has led 
Mr Carlsson to run a low-key 
campaign ahead of Sunday's 
vote, allowing even members 
of his cabinet to campaign for 
a No. His judgment is that the 
way to win over the undecided 
is by quiet persuasion, not by 
coercion. 

Yesterday, an opinion poll in 
the newspaper Dajgens Industri 
showing the Yes side moving 
into a 52-48 per cent lead 
suggested be may well be 


Chancellor Helmut Kohl's 
Christian Democratic Union, 
and the Christian Social Union, 
its Bavarian sister party, 
refused to applaud. “It was a 
hard decision not to applaud 
him,” said Mr Rolf Kiefer, CDU 
spokesman. “Heym went on 
about the crisis instead of 
looking at the good things of 
unification. He never talked 
about the oppression of the old 
dictatorship." But Mr JUrgen 
Mdllemann. the maverick 
member of the Free Democrats, 
the junior partner in the coali- 
tion, said “the speech was 
more moderate than I had 
expected. I applauded." 

The only ones who 
applauded en masse were the 
PDS. and the opposition Social 
Democrats, who, in 199Q, had 
opposed German unification. 


proved right But it is a high- 
risk strategy for there is much 
at stake on Sunday. 

A No vote will stake the gov- 
ernment’s most urgent task of 
filling the hole in the public 
finances more difficult. A 
sell-off of Swedish bonds and 
the krona will almost certainly 
drive up long-term interest 
rates, already well above Euro- 
pean averages, requiring 
deeper spending cuts to control 
a state debt approaching 100 
per cent of gross domestic 
product. 

Sweden's big international 
companies such as Volvo, 
Ericsson and Electrolux are 
likely to continue a trend well- 
established for a decade or 
more of investing heavily 
inside the EU, not at home in 
Sweden. In sectors vital to 
Sweden such as the forestry 
and telecommunications indus- 
tries, being inside the EU. able 
to influence policy and regula- 
tions on market conditions and 
standards, is of great 
importance. 

Politically, too, much is at 
stake. Part of Mr Carlsson’s 
low-key approach has been to 
protect his position should he 


By Michael Undemaim in Bonn 

The international credit card 
may finally have found a home 
in German; despite the best 
efforts of the German banks to 
stop it happening. 

Credit cards have, for years, 
had doors slammed in their 
faces as Germany clung to its 
cash and cheque culture. In 
restaurants, waiters would 
take offence at the sight of a 
card. Shops cashiers would 
simply refuse to take them. 
Even now, despite having 
made some ponderous head- 
way, there are still just 9m car- 
dholders in Germany compared 
with an estimated 37m in the 
UK 

Now Deutsche Balm (DB), 
the state-owned railways, will 
turn its popular railcard into a 
joint venture with Citibank, 
the US bank which is one of 
the world’s largest providers of 
credit cards, offering travellers 
all the advantages of a Visa 
card. 

The Balm card or railcard, 
which offers half-price travel 
on the entire network, was 
introduced a couple of years 
ago and already has 3m cus- 
tomers. Both DB and Citibank 
forecast Bahncard sales will 
rise significantly with the new 
attractions. 

Foreign banks have accused 
the Germans of using every 
trick in the book to keep their 
cards out of the market. 

Citibank says It made DB an 
offer at the beginning of the 
year. 

The railways, one of the sym- 
bols of German efficiency and 
effective state stewardship, 
have been turned into a joint 
stock company as a first step 
towards privatisation and were 
having to look at new ways of 
making money, especially as 
administering the Bahncard 
was costing them about 
DM20m (£Sm) annually. 

Other banks made alterna- 
tive offers and a final decision 
was expected in September. 

But then, as Mr Volkert Min- 
dermann, a spokesman for Citi- 
bank, put it, “in the middle of 


be faced with a No vote. Hav- 
ing led the Social Democrats 
decisively back to power in 
September's general election, 
he would probably avoid a fall 
from power if there was a No 
vote. 

But his authority and that of 
key pro-EU ministers such as 


‘Canada is 
satisfied with 
Nafta but 
nobody wants to 
join the US' 

Mr GOran Persson. the finance 
minister, would be badly dam- 
aged. The initiative would shift 
to the anti-EU left of the Social 
Democratic party and, signifi- 
cantly, to the Left party and 
the Environment party, whose 
support the Social Democrats 
need for a parliamentary 
majority. The leftwingers 
oppose fiscal measures which 
hit the welfare system. 

Other economic policies cur- 
rently being reviewed by the 
Social Democrats, such as pri- 


the ni gh t" there was an offer 
from the CeseUschoft ftir Zah - 
lungssysteme ( GZS ), a pecu- 
liarly German organisation set 
up by all the domestic banks to 
manage Eurocard, the leading 
credit card in Germany which 
has around two-thirds market 
share. 

GZS, representative of the 
collective nervousness of its 
owners at a large and emblem- 
atic foreign intrusion into the 
local credit card market, appar- 
ently offered to hand the entire 
annual revenues from the card 

- estimated at around DM1 50m 

- to DB if it were given the 


‘It’s a question of 
habit. Germany is 
very much a cash 
society. It was 
also difficult when 
cheques were first 
introduced and 
more difficult to 
get people to use 
cash machines’ 


business. But they reckoned 
without the federal monopoly 
authorities in Berlin who 
began making enquiries to see 
whether GZS might be creating 
a cartel (being operated by too 
many banks), and before they 
could open a formal investiga- 
tion. the Eurocard offer was 
withdrawn. 

“The German banking com- 
munity is still fighting against 
credit cards," Mr Mindermann 
said. 

"They think everything can 
be done with the Eurocheque 
card and they'll try anything 
to keep foreigners like Citi- 
bank out,” he said. 

Citibank also estimates it 
will have revenues of between 
DM100-DM150m a year which it 
will share with DB. “But we 
need to keep some of the 
money to cover our costs," Mr 


vatisation of Telia, the state 
telecommunications company, 
and energy deregulation, 
would face sharper opposition. 

On Sunday, many of the 
large numbers of still unde- 
cided voters who will deter- 
mine the outcome may ulti- 
mately chose instead to trust 
the unanimous verdict of Mr 
Carlsson, Mr Carl Bildt. the 
former conservative prime 
minister, and Sweden’s indus- 
trial leaders that EU member- 
ship is essential for Sweden's 
economic renaissance. But 
they will face a tough fight to 
the finish. 

In the No campaign's scruffy 
office in the southern city of 
Malmo last week, Mr Henrik 
Skrak, the No side's chief local 
organiser, made the case that 
Sweden's economy was return- 
ing to growth this year pre- 
cisely because it abandoned in 
1992 the EU-oriented policy of 
pegging its currency to the 
Ecu. “Canada depends on 
exports to the US and is satis- 
fied with the North American 
Free Trade Agreement Nobody 
In Canada wants to join the 
US. Why should we join a 
united Europe?” he declared. 


Mindermann said. But while 
Citibank has succeeded in rip- 
ping a large hole in the fenced 
off German market, it may be a 
while before other credit card 
companies will be able to slip 
through it 

American Express, which 
has just 1.2m cardholders in 
Germany, is still locked in a 
court battle with the Zentmle 
zur Bek&mpfung unlauteren 
Wettbewerbs - a title which 
translates as the Centre for 
Combating Unfair Competition 
- an organisation which has 
been policing German competi- 
tion law since early this 
century. 

This tight policing probably 
does not surprise American 
Express. “It’s a question of 
habit.” says a local Amex offi- 
cial. “Germany is very much a 
cash society. 

“it was also difficult when 
they first introduced cheques 
and it was even more difficult 
to persuade people to use cash 
machines" in the eighties, she 
said. 

The Zentrale hauled Ameri- 
can Express in a year ago for 
offering another company’s 
products (free flights) in an 
attempt to boost its own sales. 
That, said the Zentrale, was a 
breach of the Zugabeverord- 
mmg. a law which forbids the 
offer of free gifts with the sale 
of goods. 

American Express has since 
had to stop marketing the 
promotion. 

They are still "optimistic" 
that they will win the court 
case but are wondering why 
the Zentrale has not, in the 
meantime, taken action 
against Lufthansa, the national 
carrier which offers a promot- 
ional package including car 
rental and hotel stays from 
companies which are not their 
own. 

American Express would not 
comment. 

But it may just be that the 
German national carrier is 
having a blind eye turned 
towards it, while outside com- 
petitors remain in the fixed 
gaze of the authorities. 



Writer Stefan Heym. 81, who won a seat on the ex-communists’ ticket, opening the parliament session in Berlin as the oldest MP «*** 


Jewish writer hears old echoes in 
the new Germany’s Reichstag 


Germans flexible at 
last on credit cards 


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NEWS: THE AMERICAS 


Budget policy swings in political wind 

Republicans’ election success leaves future direction in doubt, writes George Graham in Washington 


The Republican takeover of 
Congress has left fiscal expats 
and financial market analysts 
in doubt over the future of the 
US budget policy. 

Is Washington about to 
embark on a frenzy of tax cuts 
that could widen the deficit 
dramatically unless offset by 
the kind of severe spending 
cuts that neither Republicans 
nor Democrats have ever 
shown any real inclination to 
undertake? 

Will the fiscal restraint 
begun by President Bin Clin- 
ton’s 1993 budget continue as 
Republicans follow through on 
their promise to ampnri the US 
constitution to require a bal- 
anced federal budget, and take 
the steps necessary to achieve 
that balance? 

Or will gridlock set in, leav- 
ing the US with its current, 
relatively moderate budget def- 
icit but with severe fiscal 
imbalances in the longer term 
unaddressed? 

At its most extreme, the new 
Republican majority in Con- 
gress includes members such 
as Congressman Dick Armey, a 
confirmed supply-side econom- 
ics professor from north Texas 
who wants a flat income tax 
rate, and believes that tax cuts 
will pay for themselves 
because of the additional reve- 
nue they produce. 

But Mr Clinton warned in 
his press conference the day 

after the Republicans' crushing 
election victory that he would 
“do all in my power to keep 
anyone from jeopardising this 
economic recovery by taking 
us back to the policies that 
faile d before” and produced the 
rising defic its of the 1980s. 

The House Republicans’ 
“Contract with America” 
promises measures that would 
reduce government revenue, 
such as a $500 per child tax 
credit, lower tax rates on capi- 
tal gafag and a hi gher pw mfngs 


federal budget deficit 


count on the 




absentee vote 


By Jurek Martin fri Washington 


90 92 94 96 88 

projections 





Clinton: stern test on budget cutting measures 


More than a sop to Senator Kerrey 


threshold before older 
Americans still working lose 
their social security pension 
benefits. 

But, although it promises a 
balanced budget constitutional 
amendment, it offers no specif- 
ics of the spending cuts that 
would be needed to balance the 
budget. Republican candidates 
have individually been assur- 
ing their constituents that they 
would not touch social secu- 
rity, Medicare, agricultural 
subsidies or veterans' benefits, 
which together account for 66 
per cent of federal spending. 

Mr Clinton may have critical 
support from some Republi- 
cans whose priority is 
fiscal discipline rather 


than supply side stimulus. 

Senator Pete Domenici of 
New Mexico, who will take 
over as chairman of the Senate 
budget committee, Is a noted 
fiscal hawk who has stood out 
from his party colleagues by 
his willingness to contemplate 
higher taxes as a means of 
bringing the budget deficit 
under control. He will not have 
much support for that position, 
but is likely to serve as an 
important brake on his col- 
leagues* tax-cutting ™al_ 

Congressman Bill Archer of 
Texas, who will have direct 
control over tax policy as the 
new chairman of the House 
Ways and Means committee, 
stands between the two posi- 


tions - though closer to his 
fellow Texan than to Mr 
DomenicL He concurs with the 
supply side analysis of a cut in 
capital gains tax rates - and 
also wants to index capital 
gains to infla tion - but insis ts 
on keeping the current Budget 
Act rules which require any 
measure involving a loss in tax 
revenue to be offset by spend- 
ing cuts or other tax increases. 

“It's a discipline we must 
apply to the members of the 
Congress," he said yesterday. 

"Revenue scoring” - deter- 
mining whether a measure will 
increase or reduce the govern- 
ment deficit - is an esoteric 
science conducted principally 
by the Joint Committee on 


Taxation, a Senate-House 
organisation which will be 
taken over by Mr Archer and 
Senator Bob Packwood, the 
new chairman of the Senate 
finance committee, and may 
therefore be expected to 
change some or its methodol- 
ogy. 

Past studies have suggested 
that while a lower capital 
gains tax increases revenue in 
the short term and reduces it 
over the medium term, its long 
run effect is close to neutral 

But an administration analy- 
sis of the Republicans' promise 
to index capital gains and 
exclude 50 per cent of gains 
from tax showed the measure 
to lose $30bn over four years. 


Scoring could thus became a 
crucial battleground between 
the White House and the Con- 
gress. with accusations of 
“smoke and mirrors" flying 
freely. 

In the new political environ- 
ment, the commission on enti- 
tlements chaired by Demo- 
cratic Senator Bob Kerrey of 
Nebraska and retiring Republi- 
can Senator John Danforth of 
Missouri could play an unex- 
pectedly important role. 


It was once viewed as a sop 
from the White House to fifr 
Kerrey in exchange for his vote 
on the 1993 budget, but its find- 
ings could now attract much 
wider support. 


The outcome of a handful of 
elections, including for the 
Senate fa California and the 
governorship fa Maryland, still 
hnng in the balance yesterday, 

awaiting recounts and the tal- 
lying of absentee ballots. 

The California numbers stiff, 
heavily favour the return of 
Sffn ?»*nr Dianne Fefastefa, the 
Democrat, over Congressman 
Michael Huffington. But nei- 
ther had officially clainTad vic- 
tory or conceded defeat. 

There are an estimated 

400.000 absentee votes to be 
counted in California. With all 
state precincts reported, Ms 
Fefastefa had 11608,497 votes to 
Mr Buffington’s 3,484^87. The 
Republican would have to take 
about two-thirds of those still 
outstanding to overcome his 
deficit; unlikely given the 
closeness of the race. 

But it was much, tighter in 
Maryland, with about 40,000 
absentee ballots. Mr Farris 
Gi widening , Democrat, led Mrs 
BHen Sauerfarey by just over 

6.000 votes (6834*95 - 677,808). 
State officials said most still to 
be counted came from counties 
where he had run strongest, 
hut neither side was taking 
anything fin: granted. 

The tightest race of all fa 
which a recount was ordered 
yesterday, involved Congress- 
man Sam Gejdenson, the Dem- 
ocrat from Connecticut known 
for investigations into US sales 
to Iraq before the 1991 Gulf 
war. The official tally had hhn 
winning by just two votes over 
Mr Edward Munster. 

It was still technically pos- 
sible for Mr Tom Foley, the 


outgoing Speaker, to hold <m fa 
his Washington seat. Buf £& 
qualified concession . oh 


ercutt recognised' that a 24274 
vote shortfall was un~Kkeiy,to. 


of almost doubte thaf number. . 
- With six House seats nation, 
wide still undecided, the ' 
line-up stands at 228 Rtqnfi&' 
cans, 200 Democrats anyone' 
independent, compared to thd ’. 
pre-election 256 Democrat* 178 
Republicans and the same non- 
party representative, Mr Sar- 
nie Sanders of Vermont, -who 
squeaked back by just oyer 

7,000 votes out of 200.000 cast - 
Probably the most remark- 
able demogr a phic discovery of 
the exit polls was the wideafag- 
af the gender gap. Nationally, .. 
about 54 per cent of men voted: 
Republican, with the sarnie per-: 
centage of women preferring 
Democrats, the biggest differ- : 
wira jn polling history. - ' 

In seme key races The' spat 
was even wider and occasion- ' 
ally decisive, with ' white male 
voters, many influenced by the 
conservative Christian Coali- 
tion and the pro-gun lobby, 
turning out in force. Though 
they may yet lose, Mr Buffing- 
ton got 59 per cent off white 
male support and Mrs Sauer- 
brey 58 per cent, while no less 
than two out of three sup- 
ported Mr George W Bush Jr,, 
conqueror of Governor Ann 
Richards in Texas. 

In Virginia, where the jefi- 
gious right is particularly 
strong, Mr Oliver North outpol- 
led Senator Chuck Robb by 
46-43 per cent am«ng irwh^ but 
not enough to overcome his 
4841 deficit among women. 


Clinton blames defeat 


More conservative views in Washington will irritate Aristide, writes Canute James 


on message of hostility Haitians fear weakening of US support 

U/ rr.:*; — c n vi; ^ i e : a ...ni v. ttd «r M. Aw aMA .', ... . . . 


By Nancy Dunne 
In Washington 


President Bill Clinton 
yesterday attributed the 
Republicans’ crushing victory 
in this week’s mid-term elec- 
tions to the party's success in 
fostering hostility towards gov- 
ernment Their message is no 
longer as it was in the 1980s 
that government is the prob- 
lem, “now government jg the 
enemy ", he said. 

Speaking at Georgetown Uni- 
versity, his alma mater and the 
site of many of his most defin- 
ing campaign speeches, the 
president seemed more philo- 
sophical than bitter about the 
huge Democratic losses on 
Tuesday. 

He ticked off Ms administra- 
tion's domestic and foreign pol- 
icy achievements, concluding 
that “in an ordinary time, that 
record would have generated 
support for the congressmen 
and women who made it". 


But these are not ordinary 
times, he said. Voters are made 
insecure by the “relentless and 
dynamic" pressures of the 
global economy. "On Tuesday, 
the voters reflected their frus- 
tration with the pace of change 
and the messy and often, to 
them , almost revolting process 
by which it was made,” he 
said. The president again took 
some of the responsibility “for 
policies and political derision* 
that hurt our candidates". 
Term limits - a key point in 
the Republican’s mid-term plat- 
form - are "looking better 
every day”, he joked. 

On trade, Mr Clinton said 
that the US has “never been in 
a stranger economic position” 
to meet the challenges of for- 
eign competition. However, 
“for many people, trade still 
appears to be a gale-force wind, 
another threat ready to blow 
away the prospects of a stable 
job at a good wage." 

Mr Clinton expressed confi- 


dence that the Uruguay Round 
implementing legislation 
would be approved by Con- 
gress later this month. He lik- 
ened it to the League of 
Nations which the US Con- 
gress failed to approve after 
the first world war. “When the 
US failed to engage we paid a 
terrible price and so did the 
rest of the world fa economic 
sta gnation , isolation and even- 
tually another world war,” he 
said. 

Next week, at the meeting of 
the Asian Pacific Economic 
Co-operation group he hoped 
“to move from a common 
vision to a common direc- 
tion ... to set concrete goals to 
open the way for doing busi- 
ness fa Asia". He expected the 
leaders to set a “target date" 
for achieving free trade in the 
region. 

He would take up human 
rights questions during the 
visit but did not expect any 
“sudden” breakthrough. 


Haitian officials fear the Republican 
party’s sweeping success in this week's 
mid-term elections threatens continued 
US support for their country. 

Officials in the new a dminis tration of 
Mr Smarck Michel the prime minister, 
are worried that Republican law- 
makers, many of whom have opposed 
President Bill Clinton’s policy of mili- 
tary and economic support for Haiti, 
will demand a rapid reduction in Amer- 
ican involvement 

With Republican control of the US 
House of Representatives and the Sen- 
ate from January, the officials said yes- 
terday, it was likely that a timetable 
would be approved for an early with- 
drawal of US troops from the Caribbean 
state, creating a security vacuum before 
the planned 10,000-member Haitian 
police force was recruited and trained. 

This could create instability in the 
country, where law and order is being 
maintained by foreign troops and police 
monitors, they say. 

The economic reforms planned by the 
government may also be threatened by 
a harder line from the Republican con- 
trolled legislature. The US is the main 
donor to a $800m aid package which 


inte rnational finan cial institutions and 
the Haitian government agree is needed 
to start rebuilding the economy and the 
social and physical infrastructure over 
the next 15 months. 

A more conservative attitude to Haiti 
by US lawmakers in the New Year is 
likely to irritate President Jean- 
Bertrand Aristide, who is banking on 


Haiti will continue to be US pcEcy,” 
said Mr Stanley Schrager, a spokesman 
for the US embassy in Port-au-Prince. 
“Thus far it has been successful and we 
would hope that success would con- 
tinue in the future and that all- 
Americans will continue to support it” 
This is apparently no comfort to the 
new Haitian administration. Officials 


Clinton has succeeded so far but now 
he will be swimming upstream 


US support for the remaining 24 months 
of his a dminis tration, diplomats fa Port- 
au-Prince suggested yesterday. 

Without a clear commitment on con- 
tinuing support from Washington, Mr 
Aristide may be inclined to reconsider 
the political merits of some of the 
administrative and economic reforms to 
which he is now committed, particu- 
larly those likely to be unpopular. 

However, a more optimistic position 
is being taken by US officials fa Haiti. 
“I think the support for President Aris- 
tide and the restoration of democracy fa 


say President Clinton had to ride rough- 
shod over the more liberal outgoing 
Democrat-controlled legislature to 
secure US military pressure to force 
Haiti’s army leaders out of the country 
and assure Mr Aristide’s reinstatement 
“The one factor which Mr Clinton has 
going for his Haiti policy is that it has 
been a foreign policy success so far.” 
said a diplomat to Port-au-Prince yester- 
day. “But now he will be swimming 
upstream on this issue. This apparent 
success might be undone before it is 
guaranteed - which must be with the 


installation of Mr Aristide's successor 
fa February 1996.” 

A key player fa Washington's Haiti, 
policy fa the new legislature win be Mr 
Jesse Helms, the Republic senator from 
North Carolina, who is llhdy -fa become 
chair man of the Senate foreign rela- 
tions committee. Senator Helms has 
been a consistent and harsh critic of Mr 
Aristide, and has pubhdy questioned 
the president’s m e nt al stability. 

Meanwhile, the new government’s 
priority is to jump-start Haiti’s econ- 
omy, Mr Michel said. The adjustment of 
the economy will be done on the b asis 
of "democracy, justice and tolerance,” 
with the public sector being rebuilt, and 
social services rehabilitated. One imme- 
diate government concern is public 
health. Maternal and infant mortality 
are increasing, and there is a high ind- 
dence of tuberculosis. 

The new government win try to stim- 
ulate economic growth by an early 
reform of import tariffs fa order to elim- 
inate monopolies. State enterprises and 
services which are to be privatised will 
be sold to companies and individuals 
who will be capable of running them 
efficiently, the prime minister sa id. 


Bolivia needs Christie’s Cuba and the IMF compare notes 


$2bn to stem 


cocaine output 


in $37.5m 
NY sale 


Pascal Fletcher explores the significance of visits from a much pilloried institution 


By Antony Thontcmfl 


C uba has long pilloried 
the International Mone- 
tary Fund as the torch- 
bearer of neo-liberal capital- 
ism. It regularly blamed IMF 
“shock remedies” for causing 
hunger, unemployment and 
poverty across the Third 
World, especially Latin Amer- 
ica. 

The fact that a senior IMF 
official should have visited 
Cuba twice over the last year 
is, then, intriguing. 

The “non-official" visits by 
IMF executive director Mr Jac- 
ques de Groote late last year 
and early this year do not 
mean that Cuba, which left the 
Fund in the early 1960s, is try- 
ing to re-join, at least not yet. 

For one thing, the US main- 
tains a blocking objection to 
Caban membership as part of 
its economic sanctions against 
Cuba's one-party socialist gov- 
ernment 

But the IMF contacts do 
reflect an important shift in 
Cuba's economic policy since 
the country was left like an 
orphan in the world economy 
after the disappearance of its 
protector, the former Soviet 
Union. 

Not only is Cuba trying to 
beat its recession by imple- 
menting reforms the IMF 
would not disown, but it is also 
sig nalli n g clearly, perhaps as 
much through necessity as 
conviction, that it wants to 
come out of the cold and bad: 
fato the mainstream of the 
world economic community. 

"Whether we like it or not, 
[tiie IMF] Is a leading institu- 
tion in the world economy and 
so it is a must for us to know 
about it,” Mr Raul Amado 
Blanco, vice-president of the 


Bolivia needs at least $2bn fa 
fbreagn aid to begin eradicating 
its illegal but lucrative cocaine 
industry, the country’s presi- 
dent said yesterday, AP 
reports from La Paz. 

President Gonzalo Sanchez 
de Lozada said at a news con- 
ference that the government 
had a plan to replace coca leaf 
production - the raw material 
processed into cocaine - with 
other cash crops and industry. 

“We cannot wait for the 
demand side of cocaine to be 
resolved; it is important that 
we deal with the production 
ride,” he said. 

“It is more convenient to 
invest $lm In development and 
substituting coca fields than 
Him in reducing demand and 
combating drag traffickers.” 

The success of the govern- 
ment’s plan is dependent on 
foreign aid of at least $2tm and 
the consensus of Bolivian soci- 
ety, Mr Sanchez de Lozada 
said. The plan would convert 
the main coca leaf producing 
region of C ha pare fato an 
industrial park to be developed 
with the active participation of 
private business. 

A meeting of the country’s 
top political leaders is set for 
next week to discuss and reach 
a consensus on this plan. 

At least 300,000 people fa the 
Chapare region depend on coca 
cultivation for their livelihood. 
Coca leaf has been grown for 
centuries fa Bolivia; it is used 
as a tea for religious rites and 


chewed by farmers and miners 
to help combat the effects of 
high altitude and hunger. 

Most of the leaf devoted to 
traditional uses is grown on 
the eastern slopes of the 
Andes, while the coca for 
cocaine - about 40,000 hectares 
- is grown fa the Chapare, a 


Farmers say no 
other crop 
provides the 
income and 
assured markets 


lush sub-tropical region in the 
middle cf the country. 

Coca leaf fa rmer* say that no 
other crop provides the income 
and assured markets and have 
resisted switching from coca to 
other crops until they are con- 
vinced they can earn the same. 

The plan includes converting 
fields to other crops, relocating 
farmers to other regions of the 
country and establishing 
industrial plants fa areas not 
suitable for farming. The gov- 
ernment has begun negotia- 
tions with the Inter- American 
Development Bank, the World 
Rank and the United Nations 
to finance this programme. 

Bolivia, an impoverished 
country of 7m people, produces 
an estimated quarter of the 
world's coca leaf that is pro- 
cessed into cocaine. 


1 Christie's 

auction of 
* Impressionist 
.&• and Modem art 
Sf fa New York 
on Wednesday 
night was a 
success, totalling $37.5m 
({23.4ml. A total 44 of the 57 
lots on offer found buyers, and 
11 sold for more than yim. This 
is firm evidence that the art 
market is recovering its nerve. 
The Republican mid-term elec- 
toral victories helped to make 
the American rich feel that bit 
richer. 

The star lot was a decorative 
oil by Toulouse-Lautrec of a 
ballet dancer adjusting her 
tights. It sold for 34.78m (£3m), 
well over double its estimate. 
In contrast, the most highly 
rated item, the last circular 
version by Monet of bis favour- 
ite subject, Nymphias (Waterli- 

Ues), still in private hands, sold 
for just 53.3m, well below its 
$4m-$6m estimate. 

Nympkka had decorated the 
Manhattan apartment of the 
late Alice Tolly and Christie's 
had guaranteed her executors 
a fixed sum, reputedly around 
325m, for the chance to sell her 
collection. Fortunately for 
Christie’s all five Tully pic- 
tures in this auction found 
buyers. 

Another painting which car- 
ried a guarantee, one of six of 
the same model painted by 
Corot when cimfineri to his stu- 
dio with gout, also sold below 
target, for 31.43m as against 
the $L8m-$2J2m estimate. 



Fidel Castro: his socialist country was left like an orphan 


National Bank of Cuba, the 
cental bank, said fa an inter- 
view. 

He said the IMF officials who 
visited were briefed about 
Cuba's reform moves. Cuba 
learned how the IMF and 
World Bank had helped other 
command economies fa eastern 
Europe and Asia move towards 
market-oriented policies. 

But senior Cuban officials 
are careful to put limits on the 
rapprochement with the IMF 
and on just how far Cuba 
intends to go fa its reforms. 

Mr Amado Blanco said re- 
joining the Bretton Woods 
institutions was not being 
actively considered. “We would 
have to he convinced of the 
usefulness [of rejoin- 
ing]. . . whether it would really 
signify a contribution to our 


political and economic poli- 
cies," be said. 

Cuba’s vice-president. Mr 
Carlos Lage, said Cuba was 
ready to discuss economic 
options with the IMF, the 
World Bank and anybody else. 
“That doesn’t mean we are 
ready to do what these institu- 
tions dictate.” 

Nevertheless, the economic 
reforms being Introduced by 
Cuba would not be out of place 
in an IMF or World Rank pol- 
icy manual They Include cats 
fa subsidies to loss-making 
state companies, selective price 
increases, farm reforms, cur- 
rency reform, decentralisation 
of decision- making , the imposi- 
tion of taxes, moves to control 
liquidity and an assault on the 
yawning budget deficit. 

Many of the changes, such as 


the recent authorisation of 
public markets for farm pro- 
duce and consumer goods, also 
reflect recommendations made 
by a team of Spanish experts 
led by Spain's former finan^ 
minister Mr Carlos Solchaga. 

“Cuba is making a serious 
structural adjustment effort,” 
Joan Triana, deputy director of 
Havana University's Centre for 
Studies on the World Econ- 
omy, said. 

The budget deficit which in 
1993 stood at 4JJbn pesos, baa 
already been reduced by some 
25 per cent this year, lie glut 
of Cuban pesos sluicing around 
the economy, estimated at 
nearly 12bn pesos in circula- 
tion at the end of April, has 
already been cut by L3bn 
pesos, according to the central 
bank. 

The moves, also aimed at 
throttling the black market, 
have caused a tightening of the 
level of pesos in circulation 
and a fall in the black market 
value of one dollar to less thaw 
50 pesos from past lows of 
more than 100. Putting buying 
power back into the peso is one 
of the objectives. 

Cuban officials insist the on- 
going reforms differ from IMF 
remedies. They say the state is 
keeping a dominant, control- 
ling economic role and social 
concerns are paramount. 

“We have a strategy. . . it’s 
not a strategy of capitalist 
development. . . it’s a strategy 
of a planned, socialist econ- 
omy,” said Mr Lage, who is 
viewed as the main architect of 
Cuba's economic reforms. 

He said Cuba would preserve 
“the essentials" of its socialist 
system — nffirini shorthand for 
free, universal health, educa- 


tion and other social services. 

At the same time, however, 
Mr Lage announced Cuba was 
opening up more of its econ- 
omy to foreign investment, 
namely real estate and sugar 
production to foreign invest- 
ment 

Many forefan economists, 
however, say Cuba needs to go 
further, faster. The IMF’s Mr 
de Groote noted after his 
November 1993 visit the Cuban 
auth o riti e s were “still hesitat- 
ing over the basic issue of 
allowing more private property 
and individual o n -racking 

fa the economy”. 

The Spanish team led by Mr 
Solchaga, fa a report fa June 
this year, said Cuba “must 
start to help itself” by moving 
faster to dbanarrtte rigid eco- 
nomic structures and opening 
up more private business 
opportunities to Cubans. 

Mr Lage hinted the govern- 
ment was working on currency 
reform, expected to be the 
introduction of a convertible 
peso, and was also considering 
widening the legalisation on 
private, self-employment for 
Cabans. 

Concerns over social unrest, 
like the unprecedented . street 
disturbances fa Havana on 
August 5, are undoubtedly giv- 
ing impetus to the reforms. So 
too is the prospect of another 
record low sugar harvest, the 
third fa a row for Cuba’s sugar- 
based economy. 

Cuba also desperately needs 
fresh external credits, which 
have all but dried up since 
Paris Club official creditors’ 
rescheduling talks on the con- 
vertible currency debt of more 
than $7bn stalled in the second 
half of the 1980s. 


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FINANCIAL TIMES FRIDAY NOVEMBER 1 1 1994 ★ 


5 


NEWS: WORLD TRADE 


Apec officials 
agree on code 
for investors 


By Peter Montagnon in Jakarta 

Senior officials of the 18 
countries in the Asia-Pacific 
Economic Co-operation forum 
agreed late last night on the 
text of a new code on foreign 
direct investment in a move 
that removed, for the time 
being, a serious block to prog- 
ress on trade liberalisation at 
their meeting here. 

“We have reached a con- 
structive conclusion," said Mr 
Peter Adams of New Zealand, 
co-chairman of the group 
which has been struggling to 
resolve differences over invest- 
ment all week. Neither he nor 
other delegates would com- 
ment on details of the agree- 
ment, but US officials, who had 
objected to an earlier draff on 
the grounds that it was too 
weak, said they were pleased 
with the outcome. 

The text must be approved 
by Apec ministers who start 
formal talks here today in the 
run- up to next week’s summit 
Several officials warned that 
the agreement could not be 
regarded as final since 
ministers might want to 
change the text But they said 
they had managed to reach 
agreement on a unified text 
which should prevent the 
politicians becoming bogged 
down in their own contentious 
drafting process. 

A row over the investment 
code has been simmering here 
an week as Washington sought 
stronger wording on several 
clauses. Although the code is 
non-binding, the US was 
worried that the original draff 
offered international investors 
insufficient protection against 


regulatory discrimination by 
the host government. The US 
felt the code also lacked teeth 
in combating restrictions on 
repatriation of profits and the 
imposition of arbitrary export 
performance standards. 

Part of the problem was that 
the original draff was weaker 
in this regard than a similar 
agreement reached in the 
Uruguay Round. Right up till 
last night, however, differences 
within Apec had threatened to 
create an impasse even before 
the summit began. 

Agreement at the official 
level will improve the mood of 
today’s opening ministerial 
meeting, but there is no 
guarantee that this technical 
advance will make it easier to 
resolve deep-seated differences 
over the timetable for full 
liberalisation of trade in the 
Asia-Pacific region. 

Officials said they had not 
begun to consider the target 
date of 2020 proposed by Apec’s 
independent group of emin ent 
persons. This is being left for 
heads of state at their meeting 
here next week, but Mr Fred 
Bergsten, the US economist 
who chaired the eminent 
persons group, said last night 
he was optimistic that a 
decision could be reached. 

Mr Bergsten said that the 
Republican victory in this 
week's congressional elections 
might make the conduct of CJS 
trade policy easier. The 
Republicans will want to show 
they can work with the Clinton 
administration, he said, and 
they have fewer disagreements 
on trade and foreign policy 
than on domestic issues. 


British 
mission 
heads for 
India 

^Aiithew BaxtxwmLoncfbh 
and Kurui Bose in Calcutta 

A specially chartered Concorde 
win leave the UK for India on 
Sunday carrying Mr Richard 
Needham. Britain's trade min- 
ister, and 85 top industrialists, 
small businessmen and bank- 
ers on the UK's biggest ever 
trade mission. 

The week-long tour of Cal- 
cutta, Delhi, Bombay and 
Madras is the most ambitious 
step yet by the Department of 
Trade and Industry to boost 
British trade with India, which 
last year was worth more than 
£lbn in each direction. 

Mr Needham, who is leading 
the mission, said in London 
yesterday that opportunities 
for UK companies in India 
were unrivalled by any other 
market in the world: along 
with China, India is one of the 
world’s two fastest growing 
developing economies. 

The mission marks a further 
British attempt to build on his- 
toric links and benefit from 
India's economic liberalisation 
programme. “India is opening 
up to investment, joint ven- 
tures and increasmgiy to over- 
seas trade," Mr Needham said. 
Last year, bilateral trade was 
marginally positive in Britain’s 
favour, but this year UK 
exportshave been ri sing at a 
slower rate than its imports 
from India, suggesting there 
will be a deficit for the 
year as a whole. 

Mr Needham said the UK 
was already playing a big role 
in India, but hie hoped the mis- 
sion would lead to more d eal s, 
especially in infrastructure 
projects such as telecommuni- 
cations and power. 

The presence of bankers and 
insurance executives on the 
trip reflected the importance 
for India of private-sector 
“build-o wn-operate” and 
“build-operate-transfer" infra- 
structure projects, whose fin- 
ancing arrangements are nor- 
mally complex. 

Mr Needham is particularly 

keen to encourage -partner" 
shi ps between UK and Indian 
companies, such as a 50:50. 
joint venture 'announced yes- 
terday by Rolls-Royce, the UK 
aero-engine ; and industrial 
power group, and RPG Enter- 
prises, India’s fourth -largest 
business group. 

• The 'two companies have 
formed. RPG-RK Power Engi- 
neering to modernise and 
refurbish India’s older power 
plants.' -The signing ceremony 
will be in Calcutta on Monday. 

Mr Sanjiv Goenka, vice 
chai rman of RPG Enterprises, 
said that -"She power shortage 
in fluKa can he mitigated to 
some extent by improving the 
operational efficiency of the 
old power plants- The majority 
of power plants here are inore- 
than 12- years old and many of 
them need to be renovated." 


Gatt panel 
to rule on 
Indian car 
complaint 

By 1 Frances WBUams hr Geneva 

A Gatt disputes panel is to 
rule on a disagreement over 
imports of Indian cars into 
Poland, an issue which could 
have important implications 
for the European Union’s trade 
agreements with former com- 
munist states' in eastern 
Europe. 

India says a doubling of 
Poland’s tariff on cars in 1992, 
coupled with a duty-free quota 
for the EU under a 1991 bilat- 
eral agreement, have hurt its 
ear exports to Poland and thus 
violated its Gatt rights. 
According to the Indian com- 
plaint, its car deliveries to 
Poland fell from 4,568 units in 
1991-92 to 1.000 in 1992-93 and 
to 504 in 1993-94. No deliveries 
have been made this year. 

India, whose request for a 
Gatt panel was granted by 
Gait’s governing council yes- 
terday. said the Polish mea- 
sures could not be instilled 
under Gatt rules on free trade 
areas and breached Gatt* s non- 
discrimination principle. 

Strong support for India 
came from Japan, which said 
its own car exports to Poland 
had been affected, and from a 
number of other countries 
including the US, South Korea 
and several south-east Asian 
and T,»Hn American nations. 
The EU and 11 other countries 
said they intended to make 
representations to the paneL 

Among other items dis- 
cussed yesterday: 

• The council derided to post- 
pone discussion of a disputes 
panel report Tilling mainly in 
Washington's favour on US car 
taxes designed to penalise 
excessive fuel consumption. 
The EU hafi charged that these 
discriminated against Euro- 
pean exports of luxury cars. 

• The EU and 46 developing 
countries requested a formal 
waiver from Gatt rules for the 
tomd Convention which gives 
EO trade preferences to 70 
Third World nations. However, 
the US and some other coun- 
tries asked for more time to 
consider the details of the 
waiver and the council post- 
poned discussion to the annual 
meeting of Gatt 'members next 
month. ED officials said after- 
wards they were confident 
that the waiver, which needs a 
two-thirds majority vote, 
would pass. ■ 

• A report on dispute settle- 
ment activity showed a sub- 
stantial drop in disputes 
brought to Gatt over the past 
12 months, a decrease attri- 
buted partly to the expected 
entry into force next January 
of tougher dispute settlement 
rules under the new World 
Trade Organisation. 

• Georgia became the last 
former Soviet republic to 
.beeome a Gatt observer, along 
with’ Sudan which has applied 
directly for WTO memberehip. 


US- Japan 
trade talks 
to resume 

The US and Japan have agreed 
to resume negotiations on 
opening up Japan’s car market 
and derided to make another 
tty at striking a long-awaited 
glass deal, Reuter reports from 
Jakarta. 

Mr Mickey Kan tor. US trade 
representative, secured the 
commitment to new negotia- 
tions after a two-hour meeting 
with Mr Ryutaro Hashimoto, 
his Japanese counterpart. 
“Our meeting was very posi- 
tive," said Mr Kantor. “We 
have agreed to re-engage on 
the foil range of auto and auto 
parts issues.” Mr Hashimoto, 
and Mr Kantor are in Jakarta 
for broader Asia-Pacific talks. 
“It's always helpfol to meet 
We will move forward as rap- 
idly as we can," said Mr Kan- 
tor, noting there were “sepa- 
rate potential solutions" to 
each part of the sprawling car 
sector. 

Altogether, cars and car 
parts make up 60 per cent of 
the lopsided two-way trade 
flow, despite repeated efforts 
to strike a deal and cut the 
S60bn imbalance. Mr Kantor 
said no time had been set for 
the car talk* but lower level 
Officials would meet on Decem- 
ber 5-6, to try to iron out dif- 
ferences over Japan's $4.5bn 
Oat glass market 


Failure to ratify Uruguay Round could put trading system in jeopardy 

Sutherland warns of US ‘mortal blow’ 


fiy PrancM WHBams in Geiwva Who’s to gain from liberalisation 


Failure by the US to ratify the 
Uruguay Round global trade 
accords this year would deal a 
“mortal blow" to the interna- 
tional trading system, Mr Peter 
Sutherland, the director- 
general of the General Agree- 
ment on Tariffs and Trade, 
said yesterday. 

Speaking at the launch of a 
Gatt study which shows an 
annual $510bn potential 
income boost to the world 
economy from the Uruguay 
Round, Mr Sutherland said 
postponement of the US deci- 
sion was not an option. World 
leaders had committed them- 
selves to bringing the round, 
and the World Trade Organisa- 
tion, Gatt’s successor, into 
force next January. Failure to 
do so could destroy the results 
of eight years of negotiations. 

“It would be inconceivable 
that a country that has so 
much to gain from the Uru- 
guay Round could strike a 
mortal blow to the system by 
putting off the debate," he 
said. The Gatt report says 
trade liberalisation in goods 
alone could add over JI20bn a 
year to US national income by 
2005, more than a fifth of the 
total 

US "fast-track” authority, 
under which Congress votes on 


E s tim a ted Increase In annual income in 2005 (Sbn) 
Woridb S5l0bn 


EU 

US ' 

D eveloping 

AlramSton 

Eita 

Japan 

CNna 

Canada 

T aiwan 



Sourwc Safi 


the Uruguay Round imple- 
menting legislation without 
amendment, is due to expire at 
the end of this year. Without 
this authority legislators could 
pick the accord to pieces, effec- 
tively killing it. 

The Gatt chief said it was 
very difficult to see the WTO 


coming into existence without 
the US, which was most coun- 
tries' biggest trading partner. 
The consequences of a failure 
to ratify on time by any of the 
leading traders would be 
“extremely serious and very, 
very dangerous for the world 

economy". 


Not only would the world 
lose the benefits of the Uru- 
guay Round. The effect would 
be ultimately to destroy the 
trading system built up so 
p ainstaking ly since the last 
war. “The whole multilateral 
system would be extremely 
seriously - mortally. 1 would 
say - damaged," he said. 

The world income gain from 
Uruguay Round liberalisation 
of trade in goods shown in the 
latest Gatt report is twice the 
annual S235bn estimated ear- 
lier this year. Gatt's new eco- 
nomic model tries to capture 
the effects of increased compe- 
tition in domestic markets, 
scale economies from expanded 
world markets and the 
“dynamic” impact of higher 
j pr-omA on savings and invest- 
ment 

Of the extra global income of 
$510bn a year under Gatt’s 
“most plausible" set of esti- 
mates , nearly two-thirds 
results from reductions in non- 
tariff barriers. Of these, the 
most important is the phase- 
out of the Multi-Fibre Arrange- 
ment governing trade in tex- 
tiles and clothing, which could 
greatly reduce prices for con- 
sumers in the US and Europe 
and treble world exports. 

Cuts in industrial tariffs con- 
tribute about a quarter of the 
gains, partly through price 


cuts in domestic markets and 
partly through increased 
exports. Reductions in farm 
trade barriers account for 
about 10 per cent 

On a country basis, the US is 
the biggest stogie beneficiary, 
reaping an income gain of 
$122bn a year by 2005, while 
the European Union benefits 
by over S163bn a year. In both 
cases, the bulk of the gains 
come from lowering non-tariff 
barriers, especially scrapping 
MFA restrictions and. to the 
Ell's case, ending curbs on car 
imports from Japan. 

Japan will have an income 
boost of g27bn a year, the 
smaller figure in part 
reflecting its already low 
industrial tariffs and sHswwrb 
of MFA restrictions. Develop- 
ing and transition economics, 
axel u ding China and Taiwan, 
gain S116bn a year. China 
could benefit to the tune of 
nearly $20bn a year and 
Taiwan by over SlObn. 

The report stresses that even 
its new estimates are likely to 
understate substantially the 
benefits of the Uruguay Round 
because they do not take 
account of liberalisation in 
trade in services, and the 
impact of strengthened trade 
rules and dispute settlement 
procedures. 

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NEWS: INTERNATIONAL 


Baghdad recognises Kuwaiti sovereignty 


By Roger Matthews, 

MMdte East Editor 

Iraq yesterday abandoned Its long 
claim to Kuwait and recognised tire 
United NaUons-deflned border in an 
attempt to pave the way for an easing 
of international sanctions, imposed 
after Baghdad's invasion of the Gulf 
state in 1990. 

The decision to comply with UN 
Security Council Resolution 833 was 
taken by the National Assembly and 
later endorsed by the Revolutionary 
Command Council. It came a month 
after the US and its allies deployed 
tens of thousands of troops, together 


with warships and aircraft, to 
counter a renewed Iraqi military 
build-up near the Kuwaiti border. 

In a statement released last night 
the Revolutionary Command Council, 
headed by President Saddam Hussein, 
said that Iraq “recognises the 
sovereignty of the State of Kuwait, 

Its territorial integrity and political 
independence”. 

Iraq also Recognises the 
international boundary between the 
Republic of Iraq and the State of 
Kuwait as demarcated by the United 
Nations Iraq-Euwait Boundary 
Demarcation Commission. . . and 
respects [its] inviolability.” 


Initial international reaction to the 
Iraqi announcement was cool and 
early moves towards an easing of 
sanctions are not expected. 

The US said Iraq's recognition of 
Kuwait had to be in “practice as well 
as in words" and warned that 
Baghdad had to comply with other 
UN resolutions before sanctions can 
be lifted. 

-If that Is, in effect true m practice 
as well as in words, that is positive 
said Mr Dee Dee Myers, the 
White House spokeswoman, "but 
there are a number of other 
elements in UN resolutions that Iraq 
must adhere to before we can even 


discuss lifting sanctions.” 

.Senior US officials have previously 
emphasised that Iraq must comply 
fully with all aspects of weapons 
control and monitoring, account for 
all Kuwaitis transferred to Iraq 
during the occupation, and put an 
end to repression of the Iraqi people. 
Some diplomats have interpreted this 
as meaning the US will not support 
an end to sanctions while Mr Saddam 
remains in power. 

The UN Security Council meets on 
Monday to review the sanctions and 
British officials said yesterday they 
did not expect any action to be taken. 

However, Russia, which played a 


significant role in persuading Iraq to 
announce the recognition of Kuwait, 
is likely to press for some indication 
from the Security Council that it will 
react positively to Iraq's move. The 
National Assembly session in 
Baghdad yesterday was attended by 
Mr Andrei Kozyrev, the Russian 
foreign minister. 

France and China have also 
appeared sympathetic to rewarding 
Iraq as it edged towards full 
compliance with Security Council 
demands. But the French have taken 
a harder line since Iraq last month 
moved its forces dose to the Kuwait 
border. 


FINANCIAL TIMES FRIDAY NOVEMBERS It 


*. •*. *. — «-A* 

INTERNATIONAL NEWS-DIGEST^ - / .1. 

. NZ, Australia 
; end plans fpjf f 


Kumaratunga 
wins Sri Lanka 
presidency 


Bank goes to bat for Taiwan 

Laura Tyson reports on the mixing of banking with diplomacy 

M ixing banking with important original motivations mittee of Taiwan’s Legislative economy,” Mr Wu says. “In al 
diplomacy may seem behind our overseas expansion. Yuan, or parliament, “you find other instances, we're follow 
a curious enterprise but at the same time it makes that Taiwanese businessmen ing our clients." 


Mervyn do SOva and Reuter 
bi Colombo 

Mrs Chandrika Kumaratunga, 
the Sri Lankan prime minister, 
swept home by nearly 3m votes 
yesterday in the country's 
presidential election, in what 
she called a victory Tor democ- 
racy and peace. 

“It is a clear mandate for the 
peace process started by our 
government,” said Mrs Kuma- 
ratunga. “This was significant 
as it was done in the face of a 
strong and lnfl amatory cam- 
paign undertaken by major 
opposition parties to fan racial 
violence in hopes it would get 
more votes.” 

Mrs Kumaratunga, candidate 
for the ruling People's Alli- 
ance, received 4.7m votes or 
62.28 per cent to emerge as 
winner of the “battle of the 
widows" by a big margin. 

The opposition United 
National party’s (UNP) Srima 
Dissanayake, widow of the 
assassinated original candidate 
Gamin! Dissanayake, polled 
2.7m votes. 

Mrs Kumaratunga, the first 
woman to win a presidential 
election in Sri Lanka, will be 
sworn in tomorrow to replace 
the UNP’s Din gin Banda Wije- 
tunga, officials said. 

In her new capacity as execu- 
tive president - a position she 
has promised to scrap by July 
1995 - she enjoys virtually dic- 
tatorial powers. 

Her victory showed that vot- 
ers on the borders of an ethnic 
war-zone are not necessarily 
the most uncompromisingly 
racist or extremist 

The north-central province 
which is regularly raided by 



Chandrika Kumaratunga: 
promised to bring peace 
to the war-ravaged country 

the secessionist Liberation 
Tigers of Tamil Eelam with 
sometimes entire Sinhalese 
and Moslem villages wiped out 
voted overwhelmingly for the 
“peace candidate". 

Moreover, analysts say the 
military is now prepared to 
back her efforts to secure 
peace with the Tigers. 

Mrs Kumaratunga, 49, had 
led her party to victory in par- 
liamentary elections in 
August ending the UNP’s 17- 
year rule by promising to bring 
peace to the war-ravaged coun- 
try and cut the cost of living. 

The daughter of two prime 
ministers - she lost both her 
father and her husband to the 
country's bloody politics - Mrs 
Kumaratunga said her govern- 
ment would forge ahead with 
peace but not at the expense of 
the majority Sinhalese commu- 
nity. 


M ixing banking with 
diplomacy may seem 
a curious enterprise 
but for ChinaTrust Commer- 
cial Bank, but It has to be 
done. 

Controlled by one of 
Taiwan's wealthiest and most 
influential families, the 
island's biggest privately- 
owned bank is building an 
international presence by dove- 
tailing its strategy to become a 
"global Chinese bank” with the 
isolated government’s efforts 
to improve its relations with 
foreign countries. Just 29 
mostly small nations now 
recognise Taipei instead of Bei- 
jing, rivals since 1949. 

To begin with, ChinaTrust 
plans a network stretching 
from South America to the 
Indian subcontinent and from 
London to Jakarta, ft will later 
aim to widen its reach to South 
Africa. Russia, Australia, Can- 
ada, Mexico and eastern 
Europe. 

By the end of the year, 
ChinaTrust expects to open 
branches in Hong Kong, New 
Delhi and Paraguay. Soon 
thereafter it plans to set up 
representative offices in Hanoi 
and Tokyo, buy into joint ven- 
ture banks in Indonesia and 
the Philippines, apply to open 
a branch in New York, and 
apply to open offshore banking 
units in Thailand and Malay- 
sia. The bank has five repre- 
sentative offices - in London, 
Jakarta, Manila, Bangkok and 
Hong Kong - and recently 
established a securities com- 
pany in London. 

“Our mission is not just to 
make profits, but also to play a 
quasi -diploma tic role,” con- 
cedes Mr Wu Ching-mai, senior 
executive vice-president in 
charge of international bank- 
ing. “Of course, Taiwan’s 
efforts to gain recognition 
internationally was one of the 


important original motivations 
behind our overseas expansion, 
but at the same time it makes 
good business sense.” 

Cosy ties between business 
and government are common 
in Taiwan, but ChlnaTrust’s 
owners, the Koo family, are 
especially entwined with the 
governing Nationalist party. 
The clan patriarch and head of 
the family's diversified busi- 
ness interests, Mr Koo Chen-fu, 
chairs tbe Straits Exchange 
Foundation, a nominally pri- 
vate organisation that con- 
ducts Taipei's arm's-length 
political dialogue with Beijing 
begun in April 1993. He is also 
a member of the ruling party's 
central committee. 

His nephew and China- 
Trust's chairman. Mr Jeffrey 
Koo. doubles as an unofficial 
ambassador-at-large for 
Taiwan in part through his 
role as head of the Chinese 
National Association of Indus- 
try and Commerce. The foreign 
ministry allocates funds to sup- 
port Mr Koo’s quasi-diplomat ic 
endeavours, which include 
meetings with heads of state 
and other political 

Businessmen 
often have more 
clout and better 
access than 
government 
officials 


figures whom Taiwan's leaders 
are unable to see because of 
China's objections. 

“As Taiwan is severely lim- 
ited in its official relation- 
ships,” says Mr Parris Chang, a 
legislator from the Democratic 
Progressive party and a mem- 
ber on the foreign affairs com- 


mittee of Taiwan's Legislative 
Yuan, or parliament, “you find 
that Taiwanese businessmen 
often have more clout and 
much better access than gov- 
ernment officials. For many 
years. C.F. Koo served as 
Taipei's unofficial foreign min- 
ister. and Jeffrey has inherited 
this role from his uncle." 

Seen as one of the few Tai- 
wanese banks with the poten- 
tial to become a truly interna- 
tional bank. ChinaTrust 
recently retained Mr Samuel 
Hsich. who finished a term as 
governor of Taiwan's central 
bank at the end of May. to help 
the bank consolidate its inter- 
national links. 

ChinaTrust’s strong push 
into south-east Asia is 
designed to complement the 
government's "Go South” pol- 
icy, an effort to divert Taiwan- 
ese investment flows away 
from China and into south-east 
Asia. President Lee Teng-hui 
added impetus to the initiative 
with his “vacation diplomacy” 
tour of several countries in the 
region earlier this year. Tai- 
wanese investment in China 
has surged in recent years to 
an estimated USS20bn, and 
Taipei fears becoming econom- 
ically dependent on China. 

“Our philosophy is to 
become a global Chinese bank, 
meaning we mil serve markets 
where there are Chinese com- 
munities and Chinese invest- 
ment,” says Mr Wu. “Taiwan- 
ese companies tend to be 
unknown quantities outside 
Taiwan so they cant get bank- 
ing services in many countries. 
We can help them facilitate 
business by taking collateral 
here In Taiwan.” 

India is the one exception. 
“We're going there because it's 
a place where we think Chi- 
nese ought to go. and we're 
confident they will, now that 
India has decided to open its 


economy,” Mr Wu says. “In all 
other instances, we're follow- 
ing our clients.” 

Taiwan has opened a trade 
Office in the Tnrtian ca pital , and 
India is expected to open a sim- 
ilar office in Taipei soon. 

The bank's planned branch 
in Paraguay is not as improba- 
ble as it may appear at first 
glance. The Taiwan govern- 
ment is assiduously courting 
Asuncion with offers of eco- 
nomic assistance, and China- 
Trust's presence should bolster 
reportedly wobbly ties with the 
only government in South 
America to maintain formal 
diplomatic relations with 
Taipei. 

“There's a strong desire on 
the part of both governments 
to increase the flow of Taiwan- 
ese investment into the coun- 
try," says Mr Wu. “As well, we 
feel Latin America is changing 
for the better. There are a lot 
of Chinese immigrants in the 
region, and we want to use 
Paraguay as a regional centre 
from which to look at Brazil, 
Argentina and Chile.” 

ChinaTrust’s strength is 
likely to be in Asia, where 
Taiwan is becoming an impor- 
tant provider of both invest- 
ment and, increasingly, debt 
financing capital. Taiwanese 
h anks are beginning to join 
syndicated loans and will play 
a role in regional debt issues as 
capital markets become more 
developed. 

Trade flows are following 
investment flows in Asia, 
when Taiwan is already the 
second or third largest foreign 
investor in many countries and 
the biggest Investor In Viet- 
nam. “I think you’ll begin to 
see business groups from 
across the region teaming up 
to invest in third countries,” 
says Mr Wu. “It’9 all about 
sharing risks. That’s how 
Taiwan's industry was built” 


Exchange rate imprisons Burmese economy 

Nationalistic devotion to a strong kyat is restricting both investment and exports, writes Victor Mallet 


F ear of persecution is not 
an emotion normally 
associated with semi- 
nars on financial markets, but 
then Burma’s military junta 
does not preside over a normal 
financial system; after 32 years 
of socialist military dictator- 
ship, it runs one of tbe world's 
poorest and least sophisticated 
economies. 

“It is time to take appropri- 
ate steps for the formal open- 
ing of a stock exchange in Yan- 
gon [Rangoon],” declared 
Brig-Gen Win Tin, the Bur- 
mese finance minister, at a 
recent seminar sponsored by 
Japan’s Daiwa Research Insti- 
tute. 

But the Burmese bureau- 
crats, academics and business- 
men attending the meeting 
were visibly frightened to be 
asked by a journalist for their 
views on Burma’s economic 
policies and the prospects of a 
stock market. They shuffled 
their feet nervously and said 
they could not speak without 
official permission. 

Particularly unwelcome were 
questions about the most 
urgent financial issue confront- 
ing the junta - the overvalued 
official exchange rate of the 
kyat, the local currency. In the- 
ory a dollar buys just under six 
kyats, but on the black market 
ft will fetch 115 kyats. 

The exchange rate policy of 
the State Law and Order Resto- 
ration Council (SI ore) - as the 
junta calls itself - restricts 
both inward foreign Invest- 
ment and Burmese exports. 


Burma 

Total approved foreign investment 
by sector between 1988 and . 

July 31. 1994 (Totai .1.268.02*^ 

<W moot*' 

-09m 

:/\ \ " • -Agrfctfuv 

J \ V 92.69m 

•V \ HotatoAcMfsm. 

-.7 0 \ ' • S813>94m 

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‘ S "V \ ‘ ■ (Iota/ L 26 ao 2 fot 

■jUS*:P US • ^ 


BURMA , 


. v us 

TZ 9203.19m 




" r Japan 
.■ v- $ 1 0i.14m 


> ■ Thailand . 

1 $2 14.74m • 


Singapore 


Uaf 


szagjsm 






Soiire* Store 

Investors and exporters would 
receive for too few kyat for 
their dollars if they ran their 
businesses in a conventional 
manner, and they have been 
forced to avoid the obstacle by 
engaging in complex joint 
ventures or barter arrange- 
ments involving the export of 
beans and other agricultural 
produce. 

Slorc's obsession with an 
artificially strong currency 
would also block the disburse- 
ment of funds from the World 
Bank, the International Mone- 
tary Fund and the Asian Devel- 
opment Bank, if such funds 
were not already blocked by 
western protests against 
Store's many human rights 
abuses. 

Store generals, trained as sol- 
diers rather than economists, 
talk vaguely of an eventual 




tem4nai*d «rt*p***«i 


notably oH axptantfkn 


Source; Store 


“convergence” between the 
official and unofficial rates. 
They argue that the exchange 
rate is not a problem because 
they tolerate dealings on the 
black market, but the policy 
distorts the Burmese economy 
in several ways. 

T he armed forces and 
state-owned enterprises, 
for example, are allowed 
to import weapons and raw 
materials at the official rate, 
which means they pay unreal- 
istically low amounts of kyats 
for their imparts. And the offi- 
cial exchange rate is used to 
calculate all Import tariffs, 
depriving the government of 
much-needed tax revenue. 

“They are always talking 
about a market-oriented econ- 
omy,” says Mr Ho Chin Beng, 
chief representative in Ran- 


goon of the Development Bank 
of Singapore. “But the one 
main stumbling block remains 
the official exchange rate of 
the kyat" 

The Store's reluctance to 
tamper with the exchange rate 
is based partly on its collective 
respect for Gen Ne Win. the 
83-year-old former dictator 
who, from his retirement, is 
believed to exercise consider- 
able control over younger gen- 
erals. He is adamantly opposed 
to devaluation on nationalistic 
grounds. 

Store generals also fear that 
a devaluation will boost infla- 
tion - already r unning at an 
estimated 40 per cent - and 
anger the poor by increasing 
the cost of basic products such 
as cooking off. These are sold 
by the state enterprises that 
currently enjoy a hefty 


exchange rate subsidy. 

In the past few years, Bur 
ma's generals have embarked 
on a series of economic 
reforms. They have encouraged 
foreign investment, eased 
restrictions on tourists, liberal- 
ised agriculture, legalised the 
vigorous border trade with 
China and Thailand and 
allowed the establishment of 
private banks and private 
hotels. 

Foreign companies, particu- 
larly from Singapore and Thai- 
land, have responded enthusi- 
astically. Twenty big hotels are 
under construction in Ran- 
goon. Seventeen foreign banks 
have been licensed to open rep- 
resentative offices. Newly-im- 
ported second-hand cars are 
creating the first traffic jams 
for a generation. Consumer 
goods such as televisions are 
on display in the shops, and 
economic growth last year is 
estimated at 6 per cent 

In its efforts to revive the 
economy, the Store has even 
risked incurring Gen Ne Win's 
wrath by introducing currency 
notes in sensible decimal 
denominations such as 10 and 
100. For years the Burmese had 
to count their money labori- 
ously in notes of 90 and 45 
because nine was the general's 
lucky number. 

Store ministers have also 
tentatively begun to raise the 
cost of basic services for the 
country's 43m inhabitants 
towards more realistic levels. 
Last year. Rangoon bus fares 
were doubled to two kyat 


(about two US cents at the free 
market rate); the price of elec- 
tricity has just increased five- 
fold. except for government 
employees; and the cost of pet- 
rol rations (often resold on the 
black market) has risen from 
16 to 25 kyat per imperial gal- 
lon in the last few weeks. 

Reforms Implemented so far 
have encouraged construction 
and consumer spending and 
attracted hoteliers and crafty 
foreign commodity traders to 
Burma. But many Japanese 
and western companies are 
reluctant to invest in a country 
where the regime is unpopular 
with its subjects, the banking 
system remains primitive, cor- 
ruption and bureaucracy are 
rampant and repatriation of 
profits depends on tbe ability 
to export beans or lentils. 

"Things are changing on the 
surface, but there’s no struc- 
tural change,” says one Bur- 
mese businessman. Rangoon- 
based diplomats agree, point- 
ing out that other south-east 
Asian economies such as Thai- 
land and Indonesia have been 
able to succeed despite corrup- 
tion and military influence 
because trained economists 
and technocrats control macro- 
economic policy. 

This is not the case in 
Burma. “The problem is that 
sooner or later, as all these 
niche opportunities created by 
the reforms are taken up, the 
whole system win hit the ceil- 
ing and be held back by the 
structural Impediments," says 
one diplomat 


open skies deal 

Any hopes of establishing “open skies" b^wemi lte w Z^^ 
and Australia were finally dashed y^tw. when transport 
ministers from the two countries acknowledged tna±.aT992 
agreement, which would have given Air New Zealand access 
to Australia's domestic market from November «ri R not 
proceed. 

Mr Laurie Brereton, the Australian transport mtafeter, said 
the 1992 memorandum of underst an ding would' how go no 
further the existing concessions which allow Air New 
and to pick up the equivalent of 12 jumbojet loads of 
passengers in Australia each week and take them to another 
overseas destination. - 

Mr Williamson, his New- Zeala n d connterpart^coo- 

ceded that the climate bad changed since the agreement was*, 
si gnprf , in part because the Australian gove rnment was poised - 
to float its remaining 75 per cent stake in Qantas, the Austra- 
lian flag carrier, next year. Air Zealand’s entry hAo^tire Am-' 
tralian domestic market, as a second competitor alongside 
Ansett, would almost certainly have disrupted Qantas’a 
domestic revenue flow. 

The aviation row broke out two weeks ago when Australia' 
unilaterall y “froze” the memorandum — just days before Air 
New Zealand would have been permitted to fly internal Aus- 
tralian routes. There has subsequently been speculation. that, 
the Australian authorities were keen .to encourage a tfeqp 
between Ansett and Air Zealand, thus extending the duopoly 
which exists in Australian air services aooss the Tasman. 
Ansett already flies domestic routes in New Zealand. Nikki 
Tool Sydney . . 

S Korea to apply to OECD 

South Korea expects to apply for membership in the Organise 
tion for Economic Co-operation and Development next month, 
the ministry of finance said yesterday. The application would 
follow Korea's acceptance as an observer on the OECD’s 
financ ial market committee, which is expected to he granteiL 
by the end of November. 

Seoul plans to begin formal negotiations to become the 
OECD’s 26th member during the second half of 1995, wifha 
goal of having its membership approved by June 139K But the 
negotiations are expected to be contentious, since the OECD xs 
demanding that Korea accelerate its schedule for financial 
liberalisation, while Seoul argues that any such move would 
be detrimental to the economy. Seoul is planning to phase out 
state-supported industrial loans and deregulate interest latest 
while opening up financial markets gradually to foreign inves- 
tors and reduce controls on capital flows. But the full extent of ; 
these measures are not scheduled to occur until after 1996. - 
• North Korea yesterday gave a cool response. -to South 
Korea’s recent derision to resume economic co-operation with 
Pyongyang. A commentary by the North Korean central news, 
agency demanded that Seoul should apologise for suspending 
economic ties with Pyongyang over the midear dispute and 
repeal its national security law before co-operation could 
begin. 

But South Korean officials said the statement appeared to be 
a routine propaganda attack and did not amount to a total 
rejection of Seoul’s offer. They noted that the commentary had 
not been issued by any go v e rnm ent agency officially responsi- 
ble for inter-Korean affairs. John Burton, Seoul 

Indonesian aircraft rolls out 

Indonesia’s first aircraft to he designed and assembled by the 
country's state-owned aircraft maker , PT Industry Pesawat 
Terbang Nusantara, was rolled out yesterday in an elaborate 
ceremony presided over by President Suharto. Development of 
the N-250, a 70-sea ter turboprop aircraft 10 years in the mak- 
ing, has been criticised by the World Bank which says the 
Indonesian government would do better to invest its money in 
industries where profitable returns are more certain. 

There are concerns that it will be difficult to sell the N-250 - 
a pet project of Mr B J Habibie,' Indonesia’s minister for 
research and technology - on the international market where 
it will compete with- the models and services of long-estab- 
lished turboprop aircraft makers. 

However, Mr Habibie said yesterday that IPTN, in which 
$950m (£580m) has been invested over the past 18 years, had 
signed a letter of intent with Gulfetream International Airline 
of the US for an order of four N-25Qs and an option on ox 
more. Press reports earlier this year said FFV, a Swedish 
leasing company, signed a memorandum of unders tanding 
with IPTN for the purchase of 24 N-250s for delivery in early 
1996. In addition, three domestic carriers, Sempati Air, Merpati 
Air and Bouraq Airlines, yesterday ordered 16 N-250s with an 
option to order a further 162. 

Mr Habibie said he was looking for a US location to set up 
an assembly plant for the aircraft and said General Electric of 
the US had agreed to take a ID per cent equity stake in IPTN’s 
US venture. Mr Habibie also said he was talking to Boeing 
which was considering taking an equity stake in the pfannal 
US plant The plant would be 40 per cent owned by IPTN- and 
is expected to make its first delivery of a US-assembled Indone- 
sian-designed aircraft in the second half of 1998. Mrnuela 
Saragosa, Jakarta 

UN seeks aid for Afghanistan ^ 

The United Nations yesterday launched a $106m appeal for 
humanitarian aid far Afghanistan amid ferns that the onset of / 
winter will soon bring additional suffering to the country. 1 
With no end in sight to the battles between militia groups 
which have plagued Afghanistan since the departure of Soviet 
troops in 1989, the UN is making desperate efforts to relieve 
the misery for ordinary Afghans, including 500,000 who have 
abandoned thee- homes in the past year. Most have fled Kabul, 
which has lost a third of its population since January L when 
rival cominanders started battling for control of the city- hi 
addition, the UN is assisting about 3m refugees still living in 
camps in Iran and Pakistan and about 2m who have returned 
to their homes in Afghanistan. UN officials say that even 
taking wto account Bosnia and Rwanda, Afghanistan 
remained their biggest relief operation in the world. The latest 
appeal will fund operations until next autumn and follows a 
similar appeal which raised 560m last year. 

The officials, who visited Kabul this week, described life In 
~!L ^7 shortages of food, fuel and medicines 

comp ounding the effects of frequent rocket bombardments and 

SWJgS!' ]Sf*? aid *£° at mj00 ° PeoP 16 were still living in 
the districts directly under attack, mostly because they were 
too poor to move anywhere else. With the temperatures drop- 
col ^ n(1 hunger, particularly as relief supplies 
SiLSLfK ^Y®, ‘‘feu repeatedly interrupted by a blockade 
imposed by mujahideen fighters. Stefan Wagstyl, Islamabad 


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Vietnam branches for US banks 


By Our Hanot Correspondent 

Vietnam yesterday gave 
approval in principle to branch 
status for Citibank and Rank 
of America. 

The approval will allow the 
two big US batiks to do busi- 
ness in Vietnam for the first 
time since they were forced to 
abandon the country in 1975. 

An official from the coun- 
try's central bank, the State 
Bank, confirmed that both 
banks would be able to 
upgrade their representative 
offices in the capital. Hanoi, 
and in the southern industrial 
hub of Ho Chi Minh City, to 
full branches once the techni- 
cal details had been sorted out 


* a procedure which is com- 
mon to all foreign branch 
applications. 

Both banks have had repre- 
sentative offices in Hanoi and 
Ho Chi Minh City since early 
1993. Although they applied for 
full branch status shortly after 
President Bill Clinton removed 
the trade embargo on Vietnam 
last February, the approval 
process has been dictated 
largely by the pace of normali- 
sation of relations between the 
two countries. 

“We wish it had been given 
to us much earlier but we are 
pleased to have got it neverthe- 
less," said Mr Chuyen Hong, 
Citibank’s representative in 
Hanoi. 


Vietnam and the US last 
month agreed to establish dip- 
lomatic liaison offices in each 
capital by year's end. 

Officials from both banks 
said they expected their 
branches to be up and running 
by early next year. The bulk of 

About 20 more 
applications are 
understood to be 
in the pipeline 

their business would be whole- 
sale hanking and. In the case of 
Bank of America, advising the 
government on financing the 


rebuilding of Vietnam’s crip- 
pled power sector. 

“I think they're sending a 
positive message to the US.” 
said Mr Luu Le, Bank of Amer- 
ica's Indochina manager who, 
like Citibank's Mr Chuyen. is 
of Vietnamese origin and man- 
aged a branch of his bank in 
the then Saigon before the 
communist victory in the Viet- 
nam war forced them to close 
down. 

The Citibank and Bank of 
America branches bring the 
total number of foreign 
branches to 11 in this country 
of 72m people. 

About 20 more applications 
are understood to be in the 
pipeline but hanking analysts 


say there are signs that Viet- 
nam is starting to look over- 
banked and that few foreign 
branch licences are likely to 
emerge for the time being. 

State Bank figures show that 
combined loans among foreign 
banks amount to only $100m 
(£62m). Most of them are 
short-term loans. 

Bankers say they are reluc- 
tant to lend to state-run or 
even private Vietnamese com- 
panies, whose accounts are 
murky at best and where 
recourse to collateral has not 
yet been tested. 

They are also still smarting 
from the imposition last year 
of an unpopular turnover tax 
applied to foreign banks. 


Japanese students feel jobs squeeze 

Recession means a university education is no longer enough, reports Gerard Baker 


T he cloistered serenity of 
one of Japan’s more 
exclusive educational 
establishments has been dis- 
turbed. Gakushuin University, 
a sylvan oasis in Tokyo's con- 
crete desert, has been the alma 
mater of Japan’s emperors for 
centuries. Mere mortals have 
thrived there, too - a degree 
from Gakushuin is usually con- 
sidered a ticket to a safe career 
in Japan's economic aristoc- 
racy. 

But this year, employment 
opportunities are thinner than 
ever and a mood of doubt has 
punctured the self-confidence 
of many of the nation's elite 
students. According to Mr 
Makoto Sano, who runs the job 
placement office, fewer than a 
fifth of students have already 
found jobs - half the number 
this time last year, itself one of 
the worst years ever. The 
employment outlook has dete- 
riorated so sharply that the 
university has for the first 
time established special semi- 
nars aimed at equipping this 
year's graduates with the tools 
needed to impress would-be 
employers. ‘'The students' situ- 
ation is more difficult than for 
many years,” he says 
There has scarcely been a 
worse time to be graduating 
from a Japanese university, 
traditionally the natural pool 
of labour for the country's cor- 
porations! 

Figures published this week 


by the education ministry 
showed that the proportion of 
university students graduating 
this March who found employ- 
ment slumped to its lowest 
level since 1950. Just 70 per 
cent of college-leavers found 
jobs in the annual round of 
company recruitment, down 
from 76 per cent last year and 
nearly 12 points below the 

Japan 

Total graduate employment rate 

S096 “ 

Mate 


peak year of 1991. 

The figures do not just dem- 
onstrate the severity of the lin- 
gering recession. They herald a 
significant change in the Japa- 
nese labour market as compa- 
nies continue the painful pro- 
cess of adjusting to the more 
competitive climate of the 
1990s. They suggest the secure 
progress from school to univer- 
sity to corporation, taken for 


granted by the nation's gradu- 
ates. may be a thing of the 
past. 

The scale of the downturn 
has been magnified by an ata- 
vistic tendency by Japanese 
companies to resist redundan- 
cies. Faced with falling 
demand and excess capacity, 
the leading employers have all 
cut recruitment more deeply 
than ever. 

Toyota Corporation has 
reduced its graduate intake 
from nearly 900 three years ago 
to an expected 200 this year. 
NTT, Japan’s and the world's 
largest company, has frozen 
recruitment completely. Mat- 
sushita Electric is planning to 
take on its lowest number of 
graduates since 1979. 

As ever in Japan's male-dom- 
inated economy, women have 
been particularly affected by 
the slump in graduate demand 
The employment rate for 
female university graduates 
sank this year by 8 points to 
67.6 per cent Since 1991, the 
average number of job offers 
per female college graduate 
has fallen from 1.98 to 0.87. 
Labour market-watchers say 
Japan's women are entering an 
"employment ice age”. Accord- 
ing to a report by the Japan 
Productivity Centre this year, 
51 per cent of graduate-recruit- 
ing companies were g giyting 
not to recruit women at alL 

What alarms many students, 
male and female, however, is 


that when the economy at last 
recovers from the long reces- 
sion, companies will have a dif- 
ferent set of objectives that 
will exclude many of them. 
The education ministry says: 
“Structural changes are now 
affecting the employment of 
graduates: the numbers are 
likely to fall further yet." 

Employment 
opportunities are 
thinner than ever 
and a mood of 
doubt has 
punctured the 
self-confidence of 
many of the 
nation’s elite 
students 


The shift of manufacturing 
production offshore in 
response to the high yen and 
the need for businesses to trim 
costs to remain competitive 
will weaken demand for 
labour. There is as yet little 
prospect of an end to the prin- 
ciple of lifetime employment 
and so smaller graduate num- 
bers and more early retire- 
ments are the only means by 
which payrolls can be 


slimmed. 

But, more importantly, Japa- 
nese companies are becoming 
much more choosy in their 
recruitment. When employ- 
ment prospects do improve, the 
chances are that job opportuni- 
ties for graduates will be less 
rosy. According to one employ- 
ment consultant, businesses 
for years snapped up the 
annual supply of graduates, 
investing vast capital in them 
in the expectation that they 
would produce a long-term 
return over a lifetime of 
employment. Now, he says, 
companies are operating on a 
shorter timescale. 

“Companies are becoming 
more inclined to tap the pool of 
already qualified labour and 
see earlier returns on their 
investment. They see new 
graduates as expensive, illiquid 
assets. Better to have fully 
functioning liquid assets on 
your books.” 

University careers advisers 
like Mr £ann are already advis- 
ing students that this means a 

good university education, 
even from the best universi- 
ties, may no longer guarantee 
a job for life in one of the Japa- 
nese corporate giants, as has 
always been the widespread 
assumption. Like the corpora- 
tion itself , Japan’s graduate 
will need to adapt and compete 
more energetically than in the 
past Unless of course, he can 
become an emperor. 


Egypt to 
resume 
talks 
with IMF 


By Mark Nicholson, 

Middle East Correspondent 

Egypt is to resume formal 
talks with the International 
Monetary Fund this year, to 
try to break a deadlock 
between the two sides over 
devaluation of the Egyptian 
pound. 

A Fond mission is expected 
in Cairo before Christmas to 
discuss devaluation and a raft 
of other issues, including 
reform of Egypt's tax and 
trade policies and the pace of 
its privatisation programme. 

Agreement to give new 
impetus to formal negotiations 
followed brief telire in Cairo 
this week between Mr Atef 
Sidki, Egypt's prime minister, 
and Mr Stanley Fisher, the 
new IMF managing director. 
Direct negotiations foundered * 
in July when a team of 
Egyptian ministers failed to 
reach agreement on 
devaluation and a package of 
related issues in Washington, 

The IMF has been pressing 
Egypt to devalue the pound as 
part of its three-year-old 
s tr u c tura l adjustment policies, 
saying the currency is as much 
as 40 per cent overvalued and 
seriously impedes attempts to 
generate export-led growth. 
The pound has been held at 
around ££3.38 to the dollar for 
the duration of the IMF and 
World Bank stabilisation and 
structural reforms. 

The government has refused, 
saying devaluation would 
shatter hard-won confidence in 
the currency, which in tom 
has contributed to strong 
inflows of expatriated 
Egyptian money and reserves 
now topping $16bn. 

Neither Egyptian nor IMF 
officials would comment on 
this week’s talks, but it is 
understood no substantive 
agreement was reached other 
♦haw to resume negotiations. 

After the IMF talks, the 
government announced plans 
to sell shares in 17 public 
sector companies worth 
around E£1.5bn ($440m) by 
January 17 to give a push to 
its hitherto sluggish 
privatisation programme. 


Government in 
Nigeria accused 
of repression 


Amnesty International 
yesterday accused the Nigerian 
government of jailing hun- 
dreds and killing dozens of 
opponents to stifle political 
activity, write Paul Adams in 
Ingos and Beuter. 

The human rights pressure 
group said it considered Chief 
Moshood Abiola, winner of the 
1993 presidential elections but 
imprisoned by the military 
government, as a prisoner of 
conscience. 

“The country is now facing 
one of the most serious human 
rights crises for decades, trig- 
gered by these killings of crit- 
ics. imprisonment for treason 
of the president-elect of Nigeria 
and the detentions of ethnic 
group leaders, prominent trade 
unionists and opposition politi- 
cians,'* it said. 

Amnesty called on the Niger- 
ian government to release all 
prisoners of conscience and 
abolish legislation allowing 
indefinite detention without 
charge or triaL 

It accused the government of 
arresting hundreds of demon- 
strators. detaining government 
critics and using “lethal force” 


to crush pro-democracy pro- 
tests and strikes. 

“The military government of 
General Sani Abacha has 
shown its contempt for the 
rule of law and internationally 
recognised human rights by 
silencing the opposition not 
only in the press and the 
streets, but also in the courts,” 
it said. 

. Amnesty also accused the 
government of repressing the 
impoverished Ogpni people of 
southeast Nigeria who have 

protested against pollution by 

oil companies. 

Meanwhile, Nigeria’s consti- 
tutional conference has been 
extended by at least two 
months until next January. 

Delegates at the conference 
in Abuja will review proposed 
changes to the constitution 
until December 8, then begin to 
approve a draft constitution on 
January 9. 

The conference was set up 
by Gen Sani Abac ha's military 
regime, which seized power 
after the annulment of last 
year's presidential election, to 
pave the way for the promised 
transfer to elected civilian rule. 


Zimbabwe farm 
seizure allowed 


Three white Zimbabwean 
formers whose land was ear- 
marked by the state for forc- 
ible seizure for resettling land- 
less blacks have lost a High 
Court case to stop the govern- 
ment acquiring their farms, 
Reuter r eports from Harare. 

In a judgment made avail- 
able to reporters yesterday. 
Justice Godfrey Chidyausikn 
tided that a 1992 law giving 
the state sweeping powers to 
seize farms for resettlement 
did not violate Zimbabwe's 
constitution. 

In his 22-page ruling. Justice 
Ciudyausiku sank “The consti- 
tution recognises and codifies 
the state’s right to compnlso- 
rily acquire property, and 
indeed elevates the individu- 


al's entitlement to compensa- 
tion for compulsory acquisi- 
tion to the level of a funda- 
mental right.” 

The farmers - Alistair 
Clothered Davis, Michael 
Anthony Clark and Erna 
Rhodena McClean - had 
argued that since the state 
offered no compensation when 
it designated land for seizure, 
and only compensated on 
transfer, the concept of ear- 
marking land contradicted the 
con s t i t uti on. 

But the court upheld the 
state's submission that it was 
exercising its regulatory pow- 
ers of earmarking land pend- 
ing future acquisition. 

Zimbabwe’s population of 
10m includes 100,000 whites. 


roils out 




at the TOYOTA PLANT robots Within 60 seconds of the is checked by Bill Johnson. 

check the cars To an Carina G bodyshell appea- He guarantees that every 

accuracy otojl am. ring on the line , two robots car leaves Burnaston with 

BUT WHEN WE WANT real have measured the car a perfect finish. 



PRECISION WE RELY ON THE from ODC end to the Other THESE ARE TWO EXAMPLES OF 

HUMAN EYE. CO within 0.1 mm. TOYOTA’S QUALITY ASSURANCE. 

The production line for the But not everything relies oo IN tie first case its a 


Toyota Garina E in robots, some tasks need the robot and w the second 

Burnaston, Derbyshire is accuracy of the human eye. rrs a person. 

one of the most advanced Further down the line the Bill knows why this works 

production lines in Europe. paintwork of the Ca rina E so well. "At Toyota robots 


do the jobs which are too 
monotonous, too strenuous 
or too lime consuming for 
a person. People like me 


everything as wen as I can." 
THIS PARTNERSHIP BETWEEN 
PEOPLE AND ROBOTS 15 ONLY 
ONE OF MANY IDEAS DESI8MED 


And it is these standards 
which have led owners to 
rate Toyota the most 
reliable cars in Britain. 


But ultimately, you can r t beat the 
human touch. 


are responsible for overall 
production control and 
quality assurance." 

So why can't the robot 
check the paintwork? 
"Because the robot would 
take too long and can't see 


to ensure toyoia maintuns For more information, 
ITS HIGH STANDARDS OF QUA- call 0800 777S5S. 

UTY. IT IS THESE STANDARDS The car in front IS a 
WHICH ENABLE TOYOTA TO Toyota. 

OFFER A COMPREHENSIVE 


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ON ALL rTS MODELS. 



The Tuyou Information Service is operated do behalf of Toyota iGB) Ltd. 







■ I 


FINANCIAL TIMES FRIDAY NOVEMBER I I >94 


NEWS: UK 


Charities face long wait for lottery cash 


UK NEWS DIGEST 


By Raymond Snoddy 


Mr David Sieff, chairman of the 
National Lottery Charities Board, 
admitted yesterday that the board, 
which could have £lOOm a year to 
distribute to charities, may not start 
making grants until late next 
year. 

The admission came a week before 
the first multi-mfllion-pound National 
Lottery draw takes place on 
November 19. Twenty per cent of the 
proceeds of the lottery will be 


distributed to UK charities via the 
board, and between 150,000 and 
200.000 applications for money are 
expected each year. 

There is growing concern, however, 
that delays ma y maan that the board 
may not be in a position to accept 
applications until “the latter half of 
next year", according to its acting 
secretary. Mr Kirk Coulson-Gilmer. 

Charities already fear that the 
National Lottery wifi have an overall 
net adverse effect on their funds. 

“It's a shambles. An absolute 


disgrace,” a lottery specialist who 
asked not to be named said yesterday 
of the progress made so Ear by the 
Charities Board. 

Mr Sieff, a director of Marks & 
Spencer, admitted yesterday; “If we 
are going to succeed we need time to 
prepare - certainly man y months - 
before we nan begin the actual 
distribution of funds.” 

Money will be held in 
interest-bearing accounts until grants 
are made. Mr Sieff added that be 
would not be put off from doing the 


job properly “either by media 
pressure, or by the understandable 
anxiety or impatience of possible 
recipients of grants”. 

At the moment the board is staffed 
by four civil servants on secondment 
from the Home Office, although 
consultants with expertise in business 
systems, management and public 
relations have also been engaged. 
Advertisements for a chief executive 
were placed just two weeks ago. 

There have also been complaints 
that charities trying to contact the 


board have only been able to reach an 
answering machine- Calls hare been 
going instead to both Camelot, the 
lottery operator, and the Office of the 
National Lottery. 

At a meeting last week attended by 
Camelot and Charities Board 
representatives, it is believed that 
Camelot asked what callers to the 
Lottery Hotline should be told about 
the Charities Board. 

A board member suggested they 
should be asked to call back in a few 
months. 


Court rules for 
British Coal in 


patents case 


CDs squeeze vinyl’s share 
of music market to 3% 


Trucks boost vehicle sales 


By Kerin Done, 

Motor Industry Correspondent 


By AEce Rawsthom 


Vinyl discs account for little 
more than 3 per cent of UK 
sales of recorded music com- 
pared with almost 65 per cent 
in 1962, when compact discs 
were launched, says a study 
published by the Datamonitor 
market research consultancy. 
Datamonitor predicts that 
vinyl will "soon be a thing of 
the past" 

Most big music companies 
and retailers no longer make 
or sell albums or singles on 
vinyl, which is now restricted 
to a cult market of disc jockeys 
and collectors. 


Sales of CDs have risen 
almost as quickly as those of 
vinyl have fallen. After five 
years on the market CDs repre- 
sented 12.6 per cent of recorded 
music sales in 1987 and 
claimed 60.5 per cent last year. 

Audio cassettes, which 
gained share for a brief period 
immediately after the launch 
of CDs accounted for 56.3 per 
cent of the market last year, 
roughly equivalent to their 35.3 
per cent share in 1982. 

Datamonitor believes CDs 
will continue to gain share 
because only 37 per cent or UK 
homes have a CD player. 

This relatively low level of 


penetration should stimulate 
sales in the future as more 
households acquire players 
and replace their old vinyl 
record collections with com- 
pact discs. 

Datamonitor also anticipates 
additional growth as new 
music media, such as Sony's 
MiniDisk format and Philips’ 
digital compact cassette, gain 
ground. As a result it expects 
the recorded music and blank 
tapes market to expand from 
last year's £1.6bn to £1 ,85bn in 
1998. 

UK Records & Topes. Data- 
monitor, 106 Baker Street, Lon- 
don W1M HA £395. 


New UK commercial vehicle 
registrations rose by 15.1 per 
cent last month to 18.590 with 
the help of a big increase in 
truck sales. 

In sharp contrast to recent 
trends in the UK new car mar- 
ket, where registrations fell by 
3 per cent last month, demand 
for commercial vehicles has 
been strong since the summer. 

In the first io months of the 
year new commercial vehicle 
registrations increased by 15.5 
per cent to 195,540. according 
to figures released by the Soci- 
ety of Motor Manufacturers 
and Traders. That compared 
with a rise of 8-5 per cent in 
new car registrations. Sales of 


new trucks (above 3.5 tonnes 
gross vehicle weight) jumped 
by 58.7 per cent in October to 
4^545. 

The truck sector has led the 
commercial vehicle market out 
of recession with registrations 
rising by 20.6 per cent in the 
first 10 months of the year to 
36,568. 

Sales of heavy trucks (above 
15 tonnes), most importantly to 
long distance hauliers and to 
the construction industry, 
have achieved the strongest 
growth with registrations 
increasing by 27.7 per cent in 
the first ten months. 

European truckmakers 
intensified marketing efforts in 
the UK. where growth has 
been higher than in most conti- 
nental European markets with 


the result that truck imports 
are rising rapidly. 

Imports accounted for 58.5 
per cent of the UK truck mar- 
ket in the first 10 months of 
the year compared with 49 per 
cent in the corresponding 
period a year ago. Registra- 
tions of imported trucks rose 
by 43J3 per cent compared with 
an increase of 20.6 per cent in 
overall truck sales. 

Renault - albeit from a small 
base - Daf and Scania have all 
gained ground in the UK heavy 
truck market 

Iveco. the commercial 
vehicles subsidiary of flat of 
Italy and overall leader of the 
UK truck mark et has suffered 
a significant loss of market 
share to 22.6 per cent from 24.7 
per cent a year ago. 


British Coal is Likely to benefit by several million pounds after 
the Court of Appeal ruled in its favour in a patent case 
involving its Coal Products subsidiary. The case ooakTalso 
have implications for the ooqwiatioa's'foi fficoming sale of the 
subsidiary, which manufactures sm o keless flaels.In the Court 
of Ap peal T- nimg , judges unanimously overturned a deosfaa of 
Mr Justice Mummery who found Coal Products had i nfri n g e d 
the Belgifl" company GlaverbeTs pa tent ed process for repair- 
ing the lining of refractory ovens. • ••- - • 

Coal Products said it based the process on technology which 
it has always asserted are in the public dom a in . Mr Andrew 
Inghs, a partner at Nabarro Nathanson,.a firm of sohdtare 
acting for British Coal, said he expected the Court of Appeal to 
order Glaverbel to pay British Coal's costal British Coal-has 
selected four companies as preferred bidders for Coal Products 
including Anglo United, the quoted company which makes foe 
Coalite smokeless fueL ■ - . 


Treasury issues rules for 
new investment companies 









WELCOME TO THE MEETING POINT OF EUROPE’S FUTURE. 


Europe’s political leaders will be meeting ,n tbe uring traditional industries into new centres of 
Ruhr for the first time. A region with 5.5 million excellence in research and production. Creating 
people working together to build an economic an extraordinary, new quality of life. Sign- 
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i r ‘ ~ ' - n: ~ EUROPEAN EVENT, 

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The UK Treasury yesterday set out part of the regulatory 
framework it intends to put in place for open-ended invest- 
ment companies - a different form of pooled investment funds 
from unit trusts - when they are allowed in the UK nest year. 
OEICs are common in other European countries and in north 
America, where investors and their financial advisers are 
rm familiar with unit trusts, and their introduction into the UK 
is intended -to help British fund managers compete more 
effectively. 

Among the si gnificant elements to the regime ‘will be that ■ 
OEICs wifi be able to include “umbrella ftjnds" - through j 
which an OEIC is maria up of a number of sob-funds - and 
that “bearer shares” will also be allowed. Both are allowed ten. 
rarely used in unit trusts, but many investment managers 
believe they will be more popular far the new investment 
vehicle. 

Allowing bearer shares - a different way of establishing 
ownership of the. investment - should make it easier . for fund 
manag ers wanting to sell elsewhere in Europe, in countries 
such as Germany and France where this form of share is much 
more common. 


R-R and British Aerospace 
support competitiveness effort 


The Society of British Aerospace Companies yesterday 
launched a campaign to improve the competitiveness of (he 
industry. The initiative flows from the Department of Trade 
and Industry's White Paper on competition, and is similar to 
that already launched in the motor industry. Mr Tim Eggar, 
industry minister, opened the scheme at a seminar in central 
London. The campaign is supported by large companies such 
as British Aerospace, GEC and RoCs-Royce. 

The society's "Competitiveness Challenge" encourages aero- 
space manufacturers to share information about best industry 
practice and to co-operate to deepen understanding between 
component suppliers and the big assembling companies, ft will 
use seminars, workshops and self-assessment questionnaires 
to help companies understand where their advantages and 
problems lie. The UK aerospace industry lias improved its 
balance-of-trade surplus in the past decade, a distinction 
shared only by the chemical and pharmaceutical industries. 


Government goes on-line 


A pilot project to provide access to government documents 
through tire Internet, the international computerised informa- 
tion network, was announced yesterday by Mr Robert Hughes, 
the junior science minister. Inform ation from the Stationery 
Office, which publishes official documents, and the Citizen's 
Charter Unit will be among the first government contributions 
to the growing electronic network. Government information 
can be accessed through Internet an www.open.gov.uk. 


Fire-eater down in the mouth 


A fire-eater who claims be failed a drink-drive breath test 
because of paraffin he had put in his mouth for a performance 
is to take part in a unique hospital study in a bid to prove his 
innocence. Mr Darryn Savfite, 28, will plead not guilty to 
drink-driving if the intaximeter test to be earned out at The 
London Hospital shows that paraffin puts him over the legal 
limit for driving. 

Mr Saville of Woking, Surrey, was arrested on July 28 on his 
way back from a public fireeating show. A breath test showed 
he was 2V> times the legal drink-drive limit, Camberiey Magis- 
trates Court heard yesterday. His defence lawyer said Mr 
Seville, who works during the day as a ceramic tiler, hari put 
paraffin inside his mouth for his performance just an 
hour before he was arrested. The case was adjourned until 
next month. 


Court judgment 
may shield Lloyds 
Names’ assets 


By Ralph Atkins 
Insurance Correspondent 


A Court of Appeal ruling 
yesterday threatened to under- 
mine efforts by Lloyd's to col- 
lect more than £lbn owed by 
I oss making members and to 
create confusion about the 
legal status of some of 
the insurance market's 
practices. 

Hard-hit Names, individuals 
whose assets have t raditionall y 
supported the market, wel- 
comed the court's verdict that 
Lloyd’s might have broken 
European competition law - in 
‘ particular by asking them to 
contribute to a “central fund" 
while underwriting. 

The central fund is used to 
settle claims on policies under- 
written by Lloyd’s when 
Names refuse, or are unable, to 
provide the funds required and 
also to ensure the market 
passes . UK government sol- - 
vency rules. 

The court also raised a ques- 
tion mark over whether 
Lloyd's practice of encouraging 
the reinsurance oT its policies 
within the ' market might also 
have breached European com- 
petition law. 

The decision, overturning an 
lower court's ruling, could 
affect Lloyd's attempts to 


recover £l.2bn earmarked from 
the central fund (and other 
assets) to cover possible liabili- 
ties on policies underwritten 
by Names. 

It will give aggrieved mem- 
bers an excuse not to pay sums 
demanded by Lloyd’s at least 
until the arguments are consid- 
ered in a full court trial - pos- 
sibly not until next aut umn. If 
the central fund is declared 
void, that would raise the ques- 
tion of whether Lloyd's should 
repay money paid into the 
fund. 

However Lloyd’s said it 
would continue its debt recov- 
ery operation and planned an 
early appeal to the House of 
Lords. It pointed out that the 
court had been considering 
only preliminary issues and 
had not taken a view on 
whether Lloyd's had contra- 
vened European law. 

Lloyd's is also applying to 
Brussels for the exemptions 
from European law that the 
Names who brought the legal 
case argue they may need. 

■ The Names' Writs Response 
Group argued that because the 
Lloyd's market comprised an 
“association of undertakings", 
arrangements made centrally 
could amount to a cartel agree- 
ment under the Treaty of 
Rome. 




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Minister acted unlawfully over Pergau, court rules 


By Robert Rice and Kevin Brown 
in London and Kieran Cooke 
in Kuala Lumpur 

Mr Douglas Hurl the UK foreign 
secretary, acted unlawfully in 
earmarking £234 tn (S376m) from 
Britain's overseas aid budget for the 
Pergau dam in Malaysia, the High 
Court ruled in London yesterday. 

The court said the grant of aid was 
“fatally flawed" because the project 
was "economically unsound" and did 
not promote the development of a 
country’s economy as required by 


British aid laws. The 1980 Overseas 
Development and Cooperation Act 
says the primary purpose of aid 
must be the economic benefit of a 
country or the welfare of its people. 

The government was refused leave 
by the judges to appeal But the For- 
eign Office said later it is was con- 
sidering whether to apply to the 
Appeal Court direct for permission 
to challenge the ruling. 

Mr Hurd said the UK contribution 
to the Pergau project would go 
ahead. He said the government 
would provide the money from else- 


where within the budget if the 
appeal failed. 

“We are contractually bound; 
there are 200 British firms working 
there," he said on Channel Four 
News. "Unless we have a successful 
appeal, we will have to find other 
ways of financing it” 

Mr Hurd said the legality of the 
deal was not questioned when he 
signed it. “The courts decide and the 
law has to be obeyed. Ministers have 
to take a view on what they can do 
in the national interest That is what 
1 sought to to do." he said. The deci- 


sion represented a victory for the 
World Development Movement, a 
lobby group, which had argued that 
Mr Hurd had overstepped his powers 
under the 1980 act by allocating aid 
money for the improper purpose of 
promoting trade with Malaysia. 

Baroness Thatcher, then prime 
minister, promised to provide finan- 
cial help for the dam in 1989 while 
negotiating a £lJ3bn arms deal with 
Malaysia. 

Mr Hurd had authorised the 
first instalment of aid in 1991 in 
spite of advice from Sir Tim 


Lords may start 
register of 
outside interests 


By Kevin Brown, 

Political Correspondent 

The House of Lords, the 
unelected upper chamber of 
parliament, is considering 
opening a register of members' 
interests to bring Lords into 
line with the elected House of 
Commons in the wake of alle- 
gations of impropriety against 
ministers and other MPs. 

The proposals, prompted by 
the prime minister’s Commons 
statement on standards of pub- 
lic life, are being drawn up by 
the powerful Lords procedure 
committee, which sets guide- 
lines for the conduct of busi- 
ness in the House. 

The committee, chaired by 
Lord Ampthill, a crossbencher, 
is expected to receive a report 
shortly from Sir Michael 
Wheeler-Booth, clerk of the 
House, on the practicalities of 
setting up a register. 

However, a register could be 
established only after a vote on 
the floor of the house. It would 
probably be supported by most 
Labour and Liberal Democrat 
peers, but might face opposi- 
tion from Conservative back- 
woodsmen. 

Peers say that such a big 
constitutional innovation, 
would probably have to be 
decided on a free vote, which 
would mean that party leaders 
would have little control over 
the outcome. 

Viscount Cranbome, leader 
of the Lords, was not availble 


PM wins backing for 
stance on EU payments 


Lankester, former permanent secre- 
tary (top official) at the Overseas 
Development A dminis tration, that 
the Hum was uneconomic and fund- 
ing it was “an abuse of the aid 
programme". 

Mr George Foulkes, Labour's 
shadow overseas development minis- 
ter. said last night that Mr Hurd's 
position had become untenable. 

In Malaysia yesterday. Dr 
Mahathir Mohamad, the prime min- 
ister, warned of retaliation if the UK 
government was forced to drop the 
£234m loan. 

■ aw; OV- .* - 


“Legal or not legal, they must 
pay.” he said. He added that if the 
loan was held up, Malaysia would 
withhold payment to Balfour Beatty, 
the British construction company 
which is the main contractor on the 
dam. Dr Mahathir said the work was 
awarded to Balfour Beatty only 
because of the loan. 

In February, Malaysia put a ban 
on awarding government contracts 
to UK companies following unfa- 
vourable press reports about the 
Malaysian leadership. The ban ended 
in September. 


for comment on the proposed 
register. 

However, he told peers last 
month that "in view of the cur- 
rent climate, it is clearly right 
that the question should be 
examined again.” 

Much of the impetus for the 
register has come from Lord 
Richard. Labour's leader in the 
Lords, who has also pressed for 
the upper House to be subject 
to oversight by the new stand- 
ing committee on public stan- 
dards, chaired by Lord Nolan 

“As far as we are concerned, 
this is something that ought to 
be pressed. Standards in the 
Lords should be the same as 
the standards in the Commons. 
and that would include a regis- 
ter of the interests of mem- 
bers.” Lord Richard said. 

However, lords involved in 
the debate point out that the 
unelected house faces special 
problems in compiling a regis- 
ter because it is difficult to 
apply sanctions to members 
who refuse to comply. 

“All that could really be 
done would be to withdraw the 
party whip, which would not 
worry most peers too much." 
one senior peer said. “Things 
are really more casual up here 
than they are in the Commons. | 
So many [Lords] have outside ; 
interests of their own, 

“People usually declare spe- 
cific interests, but if you own 
half of Scotland you have an 
interest in almost everything 
that is debated.” 


Mr John Major 
yesterday won 
cabinet back- 
ing for a battle 
plan for contro- 
versial Euro- 
pean Union leg- 
islation and public spending 
cuts of between £4bn ($6.6hn) 
and ESbn, our Political Staff 
write. As the cabinet put the 
finishing touches to the spend- 
ing side of the coining Budget, 
backbench right wing rebels 
dismissed reports that Mr Nor- 
man Lament, the former chan- 
cellor, p lans to challenge Mr 
Major for the Tory leadership. 

In a further embarrassment 
to the government, it emerged 
that the powerful House of 
Commons trade and industry 
committee is considering 
whether to reopen a shelved 
inquiry into the future of the 
Post Office. 

MPs said the committee 
might call evidence from Mr 
Michael Heseltine, trade and 


industry secretary, raising the 
prospect of damaging revela- 
tions about the cabinet's deci- 
sion to bow to pressure from a 
handful of backbench oppo- 
nents of privatisation. 

Mr Bill Cockbum, the Post 
Office chief executive, last 
night met Mr Heseltine for the 
first time since the abandon- 
ment of privatisation to 
demand rapid progress towards 
greater co mm ercial freedom. 

Mr Cockbum is understood 
to have sought a reduction of 
ill 00 m in the annual Post 
Office levy to the government. 

Details of spending plans put 
forward by Mr Kenneth Clarke, 
chancellor of the Exchequer, 
were tied up after ministers 
accepted compromise proposals 
from Mr Peter Lilley, social 
security secretary, for cuts to 
the £8bn housing benefit bud- 
get. 

Ministers also agreed the 
outstanding details of plans for 
a limited disablement rights 


bill, designed to mollify those 
outraged by the government's 
opposition earlier this year to a 
more comprehensive back- 
bench bill. 

But most of the hour-long 
cabinet meeting was taken up 
with a debate on the forthcom- 
ing bill to increase British con- 
tributions to the EU. which is 
bitterly opposed by Tory Euro- 
sceptics. 

Mr Major warned the cabinet 
that all EU governments are 
committed to implementing 
the increase in contributions 
by early next year. 

He urged ministers to make 
clear to rightwing critics that 
the cost is estimated at only 
£75m next year, and a maxi - 
mum of £250m by the end of 
the decade. 

The prime minister told min- 
isters to make sure backbench- 
ers understand that the bill 
would lock in British rebates 
from the EU budget until the 
end of the century. 



John Major warned his cabinet colleagues that all EU 
governments were committed to increasing their contributions 


Private funding of public works ‘accelerating’ 


By Charles Batchelor, 
Transport Correspondent 

The pace of the government's 
private finance initiative will 
accelerate over the coming 
year, Sir ALastair Morton. 
chairman of the government's 
private finance panel, said yes- 
terday. 

He identified a number of 
new areas where the Initiative 


might be applied and warned 
City institutions interested in 
participating schemes that 
they would be expected to 
share the risks. 

There was no benefit to the 
government in replacing public 
funds with a straightforward 
lease which simply spread out 
payments. 

“The one thing the City is 
not going to get is finance 


leases dressed up with a gov- 
ernment guarantee and carry- 
ing a padded project manage- 
ment fee," said Sir Alastair. 
“We won't wear that." 

The initiative, launched two 
years ago, had been slow to 
start, but resistance in some 
government departments was 
being overcome and potential 
projects with a total value of 
£10bn identified- “After a lot of 


wbeel-spinning there is a 
momentum which will produce 
a lot of done deals within the 
next six to nine months," Sir 
Alastair said. 

He was speaking two days 
after Mr Kenneth Clarke, the 
chancellor of the Exchequer, 
unveiled plans to force White- 
hall departments to seek out- 
side funding for all capital 
spending. 


One area identified where 
private finance might work 
was in as yet unprivatised 
organisations such as London 
Underground and the Post 
Office, which could buy in 
many services. "Does London 
Underground need to own tbe 
pumps which keep its tunnels 
dry, electricity power stations, 
its escalators and its signal- 
ling?" Sir Alastair asked. 


Scientists 
advise 
changes 
in diet 


By Roderick Oram, 

Consumer Industries Editor 

Food manufacturers broadly 
welcomed yesterday a report 
recommending changes in diet 
to help reduce the UK's level 
of coronary heart disease, 
which is among the highest in 
Europe. 

Leaks about the report dur- 
ing the summer prompted 
heavy lobbying by the Food & 
Drink Federation and some of 
its members such as Cadbury 
Schweppes, the confectionery 
and soft drink maker, Tate & 
Lyle, the sugar refiner, and 
United Biscuits. 

They believed that the 
report by the cardiovascular 
review group of the Committee 
on Medical Aspects of Food 
Policy (Coma) would make 
detailed dietary recommenda- 
tions suggesting, for example, 
cuts in consumption of sweets 
and biscuits. 

Yesterday, however, Dr Ken- 
neth Caiman, the govern- 
ment's chief medical officer, 
distanced the government 
from some of tbe report’s 
recommendations such as a 
reduction in salt consumption. 
He also stressed that the com- 
mittee’s recommendations 
were only broad guidelines 
and that the government's 
own nutrition targets 
remained unchang ed. 

Some British companies 
such as United Biscuits are 
already offering a far wider 
range of reduced-fat products 
outride the UK than at home. 

Coma's most controversial 
recommendation was a one- 
third redaction in salt con- 
sumption. 

The report also recommends 
people should eat more vegeta- 
bles. fruit, bread and potatoes 
and more oily fish. They 
should also take moderate 
exercise. 

A healthier diet would 
reduce the incidence of heart 
disease in Britain, said Prof 
Michael Marmot, Coma chair- 
man. It remains higher than 
all European countries except 
Finland, the Republic of 
Ireland and the countries of 
central and eastern Europe. 




s; ;r : he mouih 


OUR MANAGEMENT TEAM 











FINANCIAL TIMES FRIDAY NOVEMBER 


TECHNOLOGY 



Nothing 


Worth Watching • Vanessa Hbulder 


left to luck 


Operators of the UK’s first national 
lottery believe they have ruled out 
system mishaps, says Vanessa Houlder 





1 

KsiPi 





‘C • *” " * 

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kXl 


techniques could be a - 

cost-effective method of - ' - 

producing large volumes of 
collagen, which is. used tor the 

treatment of bums* fraetures and, 
stress incontinence. ■ 

Gene Farming Europe: The- 
Netherlands, tein mm fan 


T «E NATIONAL LOTTERY 


W hen the UK’s national 
lottery is launched 
next week, the win- 
ning numbers will be 
picked by a mechanical structure 
resembling a Perspex cement mixer. 

It is virtually the only low-tech 
aspect of the lottery, which, will use 
a sophisticated infrastructure of ter- 
minals, network and processors to 
deal with up to 15m transactions an 
hour. 

Although the equipment has 
mostly been tried elsewhere, its 
quantity and the short Hmp avail- 
able for its installation have won 
the lottery a place in the record 
books. Over the past 25 weeks, 
members of the Camelot consor- 
tium, which runs the lottery, have 
worked fiat out to manufacture and 
install 10,000 lottery terminals, set 
np the communications network 
and train nearly 35,000 retail staff. 

The most visible part of the sys- 
tem is the retailers' terminals, 
which scan customers’ ganlecards 
and print out the tickets that must 
be presented to claim any winnings. 

The terminals, 27,000 of which 
should be installed by the end of 
1996, have been designed by GTech, 
the US lottery operator and member 
of the Camelot consortium. It used 


a 1 0 -year-old design, which has been 
upgraded by the addi tion of a liquid 
crystal display panel and a device 
to read bar codes on the tickets. 
GTech says the technology is tried 
and tested. “The design was already 
done, the technology was in place. 
The challenge was jest the scale of 
the system,” says Don Stanford, 
senior vice-president for technology. 

Bed) Sting of ICL, which built and 
inrfaiiftd the terminals, agrees. ”1116 
complexity simply from the 

very short timescale involved. The 
actual makin g of the terminal and 
installation of the terminal is 
straightforward," he says. 

Racal responsible for li nking the 
terminals with, the lottery process- 
ing centres at Rickmansworth, out- 
side London, and Aintree, in the 
north-west of England, has also 
used relatively old technology. “The 
timescale was extremely aggressive. 
You could not afford any new 
design or risky technology in case 
there was a hiccup,” says Steve 
Hodson, executive . technical man- 
ager. 

The data will be transmitted 
using the X25 communications stan- 
dard on what will be the UK's larg- 
est private terminal/host network. 
This is an upgraded version of a 


Early warning on 
Alzheimer’s 


Computer wfthface, 
ears and feet - . 


Fingers crossed: newsagent Shobhana Patel with her terminal, which wffl scan customers’ gamecarda and print out Octets 


six-year-old network which con- 
nects government offices around 
the country. 

Racal, which has added 25 per 
cent of extra capacity to the net- 
work. believes the two uses of the 


Camelot is satisfied 
that its software 
incorporates 
adequate security 
devices to prevent 
hackers breaking in 


network will complement each 
other. For instance, the peak lottery 
traffic on Saturday afternoons will 
coincide with a low point in govern- 
ment activity. 


Not all retailers will be connected 
to the central processors by lan- 
dlines. In less populated areas, some 
5,500 retailers will use satellite 
dishes, served initially by Euteteat 
and eventually by Orion. 

Accuracy, security and robust- 
ness have all been important con- 
siderations in building the network. 
Racal is confident that no one can 
be cheated of tbeir lottery winnings 
through an error in the transmis- 
sion of the data. “The chance of 
getting an error is infinites imall y 
small," says Hodson. 

Likewise, Camelot says it is satis- 
fied that its software incorporates 
adequate security devices to pre- 
vent hackers from breaking into the 
system. 

The designers of the system have 
also tried to ensure that it can cope 
with the failure of processors or 


cables, if one processor fails, the. 
Rickmansworth and Aintree sites 
between them have three other pro- 
cessors that could act as back-ups. 

It also bas tried to ensure that a 
failed line will not disrupt the lot- 
tery. At Rickmansworth. Mercury 
and BT have five different cables 
r unning into the building through 
separate ducts. As the system fans 
out to the retailers, only the last 
mile of rahHng lacks the back-up of 
a second line. “It is a balance of cost 
against reliability,'' says Hodson. 

It may take years before the sys- 
tem shows itself able to cope with 
all contingencies. Bnt next week 
will provide the system's first and 
most challenging test. Camelot 
claims to be confident, as a result of 
its past experience with the technol- 
ogy. Unlike its customers, it trusts 
that nothing has been left to luck. 


Farmers turn to genetic control 


More than a quarter of cases of 
Alzheimer's disease are thought 
to be incorrectly diagnosed. This 
disease, which inflicts p ro gressive 
memory loss on almost one in 10 
people aged over 65, can only be 
definitively identified by an 
examinatio n of brain tisane. 

US scientists, writing in today’s 
Science, believe they have found a 
simple test for Alzheimer's which 
would allow it to be detected at 
an early stage. They found that . 
patients suspected of having the 
disease were hypersensitive to the 
pupfl-ifilating effects of 
tropteamkle. 

The scientists, who work at 
Harvard Medical School, Brigham 
and Women’s Hosp it al in Boston, 
Beth Israel Hospital in Boston 
and Northwestern University 
Medical School in Chicago, found 
that the trop ie amide eye-drops, 
which were tested on 58 
individuals, were 95 percent 
accurate in identifying the 
diseased patients. 

The scientists believe that the 
tests could identify s uffere rs 
before the onset of symptoms, 
when they could benefit the most 
from potential treatments. 

Horoord Medical Schoat US, tel 
S17 432 0440: fax 617 432 0446. 


Compaq Computer, the world's 
largest personal computer . . - . . 
company, has produced protot y pe 
novelty PCs -one called Mr PC ■ 
Head -In an attempt to increase 


Wheelwright 

It recently asked a group of 
seven- and eigtt-year-olddifldraf 
what they thought^ the Ideal 
computer would look like. The - s ;l 
result is the Mr PC Head ' 
prototype, which looks like a 
computer monitor with a fince/.—; . 
ears and feet ' 

Although tt may never become 
a commercial product, the effort • 
demonstrates how keenly Compaq 
Is studying wfaat It beUeves tea- - 
vast potential consumer market 
It behaves that PCs will need to 
look and operate a lot more tike - 
traditional consumer efectnmfcs . 
products if they are to make 
farther inroads into the home. - -~ 

Compaq: US, lei 7133700670. 


Magnesium served 
up on a plate 


T he farming industry could be 
on the brink of an important 
development in pest mid dis- 
ease control that would boost pro- 
duction levels to new heights. Gene 
transfer technology may be on the 
market in the next few years, but 
its success depends largely on pub- 
lic acceptance. 

Scientists are using biotechnology 
methods to create insect and dis- 
ease-free versions of widely con- 
sumed crops such as maize and 
wheat Species that are resistant to 
specific insects and dis eases have 
been developed by Micogen, Pioneer 
Hi-Bred, Monsanto, Ciba, Hoechst, 
Schermg and others. Applications 


to get some of these products on the 
market are now before the US Envi- 
ronmental Protection Agency. 

The Food and Drug Administra- 
tion in Washington said earlier this 
month that it would not oppose the 
development of two pest-resistant 
crops, a virus- resistant squash 
(marrow) developed by Asgrow and 
a beetle-resistant potato from Mon- 
santo. These still have to win 
approval from the EPA, but it is a 
step towards the market place. 

If all goes well the market could 
be vast. US farmers alone spend 
about $600m (£36Gm) a year to com- 
bat pests and diseases in plants. 
Modi of that money could in the 


future go to biotechnology. 

But the industry is concerned 
that public opposition could slow 
the process. Americans are believed 
to be open to the idea of transgenic 
crops, but scientists say their accep- 
tance is far from guaranteed. Many 
Americans oppose the transgenic 
Calgene tomato which was 
approved by the FDA a few months 
ago. 

Ironically, the surge in opposition 
to genetically engineered food prod- 
ucts comes as the EPA is hoping to 
encourage use of transgenics in 
farming. The agency believes bio- 
technology can cut the use of chem- 
ical pesticides, which are of increas- 


ing concern. On the back of recent 
research illuminating the profound 
health risks of pesticides, the EPA 
announced this month it would con- 
sider outlawing a number or chemi- 
cals. 

Transgenic disease-resistant crops 
are created by splicing a specific 
gene into a plant The gene causes 
the plant to produce enzymes which 
protect it from predators. Propo- 
nents of the technology say it is 
more effective than pesticides, since 
the entire plant is immunis ed. 

The main environmental concern 
of the transgenic crops is that their 
widespread use could cause insects 
and diseases to become rapidly 


resistant themselves. Under normal 
circumstances, pests gradually 
build up immuni ties to chemicals 
and other products. Because the 
transgenic crops are so efficient, 
environmentalists say, this process 
may be accelerated. 

Although this is a risk. Elizabeth 
Milewski, a special assistant for bio- 
technology at the EPA believes the 
new technology should be pursued 
enthusiastically. “These transgenic 
plants fall into what we call the 
low-risk category. They can be 
much safer than pesticide-treated 
crops." 


Transgenic mice 
make collagen 


Victoria Griffith 


Dutch scientists have bred 
“transgenic” mice that are 
capable of producing human 
collagen in their milk. 

This devdopment, which was 
achieved through injecting the 
relevant gene into a mouse's 
fertilised egg; is seen by the 
researchers as a step towards 
their goal of producing human 
collagen from the milk of 
transgenic dairy cattle. 

Gene Pharming Europe, a 
Leiden-based transgenic 
technology company, working in 


A UK electroplating company 
believes it has found a method of 
plating magnesiiim which will • 
allow the metal to be asedmore 
widely in predaon engineering. 

The tightness and strength at 

Hy mria l maltwi W an attrartto ■ 
material for equipment sndx as 
portable telephones bat its 
susceptibility to corrosion has 
been a serious drawback. 

Magnesium’s high reactivity . 
has hampered previous eftots to', 
plate the metal. But Ingram ft 1 
Glass, a Godaiming plating 
comp any i n caojimctfon with 
PMD (UK), a Coventry chemicals 
company, has developed a process 
which combines electroless nickel 
technology with magnesium 
chemistry that pexmtis the mass 1 - r 
production of plated magne si um ' 
die-castings. 

Ingram & Glass: UK tel 0483 
415262; fa 0483 42G95L - “ 




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FINANCIAL TIMES FRIDAY NOVEMBER 11 1994 

How do you respond to the advice 
of a troubleshooter? James Buxton 
looks at the case of Charles Letts 

Go away, 


MANAGEMENT 


Sir John 


W hen former company doc- 
tor Bill Gore became chief 
executive at the diary 
maker Charles Letts last year, the 
problems he was to tackle were 
already known In outline to several 
million people. 

A few months earlier Sir John 
Harvey-Jones, former ICI chairman- 
turned business guru, had breezed 
through the company in his popular 
Troubleshooter 2 television series as 
well as devoting a chapter of a book 
to it 

Harvey-Jones had been called in 
by the Letts family (which then con- 
trolled the company) after it 
plunged heavily into loss in 199L 
He examined its core diary publish- 
ing business and concluded it suf- 
fered from excess costs and too lit- 
tle capital, and was split 
inefficiently between a sales team 
in London and the printing plant at 
Dalkeith near Edinburgh. 

As for the company’s diversifica- 
tion into book p ublishin g, the divi- 
sion required more capital than 
Letts could afford and should be 
sold. 

All this was pungently conveyed 
to the urbane but wincing owners 
and managers of Letts in an agonis- 
ing televised session. Later Harvey- 
Jones lamented to the camera that 
the Letts management “have taken 
some actions, but not the ones that 
I would wish them to. I don’t think 
that the family are yet sufficiently 
worried to take the actions I think 
they should.” 

That was in December 1992. The 
dramatic (but unteievised) sequel 
was that w ithin weeks Letts’ hank. 
ere Hambros, which had been sup- 
porting the business with loans ami 
preference shares, lost confidence in 
the company’s management under 
Anthony Letts, chairman from the 
sixth generation of the family. 

Gore was asked by Letts' accoun- 
tants at the time. Coopers & 
Lybrand, to draw up a recovery pro- 
gramme. In June 1993, at the insis- 
tence of Hambros and 31, which had 
an equity stake in Letts, he became 
chief executive. 

The company was supported at 


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the end of 1993 by a refinancing 
package worth £i6m which came 
from Hambros, Morgan Grenfell, 3t 
and the new management. The 
Letts family's stake was drastically 
cut from 58 per cent to IS per cent. 

Gore had not seen the Trouble- 
shooter programme - and took took 
care not to watch the video so that 
he would be able to make up his 
own mind. But he too decided that 
many of the company's recent 
efforts to restore profitability 
amounted only to tinkering. He 
redroned Letts had “a good wide 
customer base and a good name, 
but an excess of costs and an excess 
of unnecessary activity". However, 
he did not do everything Harvey- 
Jones suggested. 

One glaring source of excess costs 
was never identified as a problem 
by Harvey-Jones, even though he 
was often filmed visiting it - the 
company’s stylish headquarters in 
Battersea, which was costing £lm a 
year in rent 

T regarded that as fundamental,” 
says Gore. He quickly struck a deal 
with the landlord under which the 
building was leased to a new tenant 
at no cost to Letts and the remain- 
ing staff moved to Dalkeith. 

Like Harvey-Jones, Gore focused 
on the books publishing business 
and decided it had been rendered 
un viable by the sale in 1992 of its 
profitable ling of examination revi- 
sion guides, leaving a range of life- 
style books without the revenue to 
meet overheads. The division was 
sold at the end of 1993. 



W orkplace violence is 
escalating rapidly in the 
US. In California alone, 
workplace homicides surged from 
159 deaths in 1992 to 195 last year, 
and the final tally for 1994 is likely 
to be even higher. 

Ironically, the epidemic of vio- 
lence has spread as the total num- 
ber of workplace fatalities has 
diminished. 

"We’ve become good at prevent- 
ing death in other categories such 
as contact with hazardous chemi- 
cals and falls," says John Howard, 
director of the California Division 
of Occupational Safety and Health 
(Caloeha). "But violence is st31 a 
big concern." 

Homicide accounts for 17 per 
cent of all workplace fatalities in 
the country, just behind motor 
vehicle accidents, according to the 
Bureau for Labour Statistics. The 
National Occupational Safety and 
Health Administration says it is 
working on recommendations to 
counteract the problem. 

Although the US media has 
recently highlighted violent acts 
by disgruntled employees, most 
incidents occur during rob- 
beries. 

"These workplace risks have 
been Ignored in the past because 
they are seen as part of a larger 
crime problem," says Guy Tos- 
cano, an economist with the US 
Department of Labour. "But they 
are so big we must pay attention 
to them." 

Taxicab drivers are murdered at 
higher rates than workers in other 
professions, accounting for 2&9 per 


Fargui Mfitoe 

Bifi Gore tried not to be influenced by the comments ol John Harvey-Jones (inset) 


A recurrent theme of the TV 
programme was that Letts 
should sell Mayfair Trunks, a 
shop in London that sells luxury 
goods. It was small but losing 
money, did not sell many Letts 
products and should not have been 
acquired, Harvey-Jones said. 

But Letts has not sold Mayfair 
Trunks. "It is not draining cash and 
we have cut the staff to two.” Gore 
says. "It’s not worth spending man- 
agement time on it. When rents 
improve we will find a good home 
for it” 


Across the organisation Gore has 
trimmed surplus layers of manage- 
ment, shedding staff in the process. 
Of the three executives from the 
Letts family, all in their late 50s, 
Martin Letts and his cousin Timo- 
thy retired, while Anthony moved, 
"after some quite fundamental dis- 
cussions”. from being executive to 
non-executive chairman and 
stepped down last August, remain- 
ing a director. Charles Letts, 
another family member, is a man- 
agement trainee. 

Staff were also cut in the US, 
where Letts distributes diaries. Ini- 
tially the new management 
attempted to diversify into produc- 
ing corporate gifts, an idea proposed 
by Harvey-Jones, but it has since 
changed its mind and pulled out of 
that operation. 

The most important part of the 
business is the diary operation. 
which claims a quarter of the UK 
diary market but was. Gore says, 
under-performing and inflexible. 
The production process for printing 
standard diaries was too slow and it 
was taking too long to design and 
manufacture customised diaries for 
corporate clients. 

Gore praises the GMBU general 
union at Dalkeith for understanding 
“the commercial realities of life” 
and abandoning the annual three- 
week works shutdown in midsum- 


mer, switching io staggered holi- 
days and a system of working 30- 
hour weeks in the first half of the 
year and 45-hour weeks in the sec- 
ond half . 

Production staff were put into 
small groups to analyse problems. 
"We identified the main problem as 
the slowness of changing plates in 
the presses at the end of a print 
run. We have now got that down by 
half, cutting the total production 
time by 25 per cent," Gore says. 

Reflecting the slimmer company, 
turnover on continuing activities 
dropped from £30m in 1993 to 
£23.6tn in the year to January 1994. 
A loss of £7.5m was reduced to 
£785,000. It made an operating profit 
of £2.2m. 

In retrospect Gore feels Harvey- 
Jones’s investigation was a mixed 
blessing. It focused tbe attention of 
management and unions, and of the 
banks and investors, on the need 
for something to be done, and 
"helped identify the real problems". 
But, as a result of the programme, 
"our customers withdrew a little bit 
[out of nervousness about the com- 
pany’s future] and certainly didn’t 
come up with new proposals. And 
our sales force was left a little dead 
in the water". In fact, be says: Td 
like to see that man go away." It’s 
the sort of bluntness Harvey-Jones 
would respect. 


Dangers 
of the 
office 
9-5 

FT writers 
look at ways to 
combat violence 
in the workplace 

cent of the US total, according to 
the National Institute for Occupa- 
tional Safety and Health (Niosh). 

Liquor store workers are next in 
line, accounting for 8 per cent. 
Other risky places to earn a living 
are petrol stations, detective ser- 
vices, grocery stores, jewellery 
stores, hotels, restaurants and 
bars. 

Non-fatal assaults also plague 
American workers. More than 
670,000 Americans were assaulted 
at their place of employment in 
1992, according to the National 
Crime Victimisation Survey, and 
the figure represents about 11 
per cent of all violent crimes in the 
US. 

"Besides tbe risk to workers. 


these incidents affect businesses 
because of missed work and 
decreased productivity," says 
Howard. A substantial number of 
victims are carers in nursing 
homes and hospitals. They are 
usually injured by their patients. 

Niosh and Cal os ha guidelines 
advise stores to keep their car 
parks as brightly lit as the local 
law allows, to post signs that a 
limited amount of cash Is on hand, 
and to install silent alarms. 

They suggest that employers in 
health care and other service 
industries instruct workers in how 
to defuse hostile situations involv- 
ing patients or clients, to install 
alarm systems or panic buttons as 
a back-up and to consider estab- 
lishing a buddy system or hiring 
security personnel. i 

Workplace crimes of passion by | 
disgruntled employees, or a work- 
er's spouse, friend or lover are not 
as common as other assaults. But 
Calosha recommends that employ- 
ers look for tell-tale signs that a 
person may become violent and 
ensure that employees with severe 
emotional problems have someone 
to turn to, such as a staff psycholo- 
gist. 

Offices should be closed late at 
night and' early in the morning 
(most attacks occur between 6pm 
and 10am). Employees should be 
discouraged from working in 
offices alone, and employers 
should encourage female employ- 
ees to let them know if they are 
being stalked. 

Victoria Griffith 


Guidelines for safety 


B ritish employers are neglecting their doty to 
prevent violence at work, a national charity 
which specialises in personal safety issues 
claimed this week. 

Under the 1974 Health and Safety Act and the 1992 
Health & Safety at Work Regulations, companies are 
legally required to carry out assessments and 
establish agreed procedures for all types of risk. 
According to the Snzy Lamplngh Trust, however, 
"what actually happens is that risk assessment tends 
to be carried out only for industrial accidents 
involving machinery or toodc substances; employers 
do not recognise that personal attacks on staff should 
be included in this process". 

In a bid to raise employer awareness the trust has 
just published guidance notes aimed at reducing the 
risks of violence and aggression at work. They have 
been formally endorsed fey the government’s Health 
& Safety Executive, tbe Confederation of British 
Industry and the TUC. 

Until tbe HSE incorporates violent incidents at 
work into the revised Reporting of Injuries, Diseases 
and Dangerous Occurences Regulations the extent of 
the problem wfll be unclear. But the trust believes 
that workplace violence is increasing faster than 
violent crime in general and estimates that there are 
an average of 35,000 incidents per year, three 
quarters of them assaults on staff by the public. 


The guide argues that both employers and 
employees have a common interest In reducing 
violence, citing the impact on morale, image and 
recruitment. "It can also mean extra costs, with 
absenteeism, higher insurance premiums and 
compensation payments.” 

Risk assessment is summarised in five steps: look 
for the hazards; classify all incidents; search for 
preventative measures, deciding whether existing 
precautions are adequate; create a company policy 
and procedures and put it into practice; check that 
tiie measures work - review a nd, if necessary, revise 
the assessment from time to time. 

The trust warns that self-defence courses "need to 
be viewed with great caution”. They need to be well 
taught though "however much training a person is 
given there will always be times when that person is 
not on top form”. Avoidance is the best option: "In 
any violent physical contact everyone will be hurt 
and if an employee responds with active aggression 
he or she may risk a counter claim ot assault” 

Tim Dickson 

*Suzy Lamphigh Trust, 14 East Sheen Avenue, London 
SW14 8AS. Guidance for employers £2.50, employee 
booklet £1.00, comprehensive package (including video 
and resource manual) £139 phis VAT. 


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CONTRACTS & TENDERS 

The British Virgin Islands Electricity Corporation 

Invites tbe submission of lenders for rhe provision of maicruU and ihc cwivn>.iwn of 
fbe following works: 

A new doable circuit 345k V overhead line un wood pules between a new 
switching substation at Long Bush and a new 34 J kV/l3.2kV sab-uaf iua at I s<ng 
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approximately 6J km. 

Arrangements have been made for this project to be funded by the Krifhh Virgin 
Islands Social Security Board and the Rancn Popular de Puerto Rico. 

Enquiry Doc u me n t s for Ute project may be obtained from BVIEC or ihcir Engineers at 
the cost of USS3(XUj0 pa sec 


General Manager 

British Virgin Islands Electricity 

Corporation 

PO Box 268 

KnodTbwn 

Tonoia 

British Virgin Islands 

WEST INDIBS 


Keen erfy ft DoxJtia Poace 
Wesibronk Mills 

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Ref 40680/pjl 


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For further informatfon or to 
advertise fa tbfs section 


Karl Loynton on . 
*44716734780 
or Lesley Sumner on 
' +44718733308 


Thermal Complex 
FOR SALE/TO RENT 
Completely restructured, 
including 4 star hotel, 
beauty farm, congress centre. 
Only companies operating within 
this sector please write, quoting 

ret No. 94/468, to: 

Studio Bid S.pA* 

Via degfi Aicunboldi 5 • 1 20123 
MILANO who will then forward 
tbe answers to (he advertiser 


FOR SALE 

tflgMy Profitable oar bodyrfwp 
repair business operating fawn 
freehold premises located 
an North London. 
Substantial Insurance company 
approvals held. 

Witte Bate BWfc FtandriTtae* 
Southwark Bridge. London SEl 9HL. 


Tel (£0594*4391! 

Fax (809) 49-44291 

Tender submissions should be submitted tij Ihc British Virgin Islands hketridtj 
Corporation, Rood Town. Toraola. Brilab Virgin Islands, by Wednesday 1 1 January 
1995 ao hter (tea 1600 hour* British Virgin Islands Time. 


LEGAL NOTICES 


8JM KNUINEERJNG LIMITED 

JOINT ADMINISTRATIVE aECUVKRS 

APPOINTED J* •ifmtMBat IW 

Notice la hereby gWea. putMiani lu eceiiun 
48f3 of the hroKmLjt Act l*«n. lhal i mcrtinp 
nf Ibe uiKcmcJ onhlim til Ihc Usw aimed 

conpanr will be held ■» I Ej *' Tend'. 
Sheffield. Si 2ET an 3 N^autxr l*M ji 
laxtuu. Creditors whine Jaw* «e '* t ».ilv 
Iren led oie not cnlillcd t-i illeoJ m hr 
icpr c.-e nted al Ihe aevling. '"alitt -.luSnes are 
unlr entitled li> »«* If a) Uu-.f Ju w JtJjvrrrd It) 
«s id the slum's be Urn. he mi bin limn 

•won on 22 Ncnewher I'WJ mihlrn ifcluls "I 
Ihc debt, i hey Cbim tu he dih- fci thou fnen ihc 
coapany. ami the dans bn l«Mn duly afcuouil 
uiidr/ Ifcr pioviainaa pi Rule LI* ol ’be 
laaolvracy Rule- |4hf,; ami b> Ihct" h*' been 
lr«l|{(<] wiih us *ny puny which the neJitor 
infcmk lo be used •■ hn u( hd hchdf. 

Doted: I Nuvendwi l*«4 
Signed - DJ.SK4nfut Ihc bans lUmothiiJinc 
Rrcdvas,r;oafcr. A I » tea ml. I List Paraik. 
ShtirWU.M 2EI 


IN THE MATTER OT 
KCU LIMITED 
-aad- 

IN THE MATTER OP 
TUB COMPANIES ACT IKS 

NOTICE IS HEREBY GIVEN dial a Older of 
|he High Conti of Jastkt. Chancery Dirtsfon 
dated the 26th October 199-1 copriiraiog Ihc 
reduction of the capital or the above moscil 
Company from £13,000,000 u fn.730,600 and 
dm MJnufc approved by dm Coon showing wi* 
respect lo the capital as altered tbe several 
pm i lodHs required by Ac abtme Da-onuocJ Ad 
woe Kgfcnod by the ScgiSiai of CraiqanKs oo 
the 27lh tby rf October 1994. 

Dreed dm M day of November 1994. 
CLIFFORD CHANCE 
TO AUtroRK Street 
IxrndM ECIA 4U 
RefcRWC 

So&atore EQ the Company 


GREEK EXPORTS S.A. 

FOUNDED AND OWNED BY ETBA. SA. 

ANNOUNCEMENT OF A SECOND REPEAT PUBLIC AUCTION FOR THE SALE OF THE ASSETS OF V1EL S. A - 
COATED ABRASIVES INDUSTRY, NOW UNDER SPECIAL LIQUIDATION 

GREEK EXPORTS S.A., established in Athens at 17 Paaepistimiou Street, in its capacity as liquidating company following decision No. 
•*583/1992 of the Athens Court ol Appeal and in accordance with Article 46a of Law 1892/90 as complemented by Article 14 ol Law 
2000/91 and supplemented and amended by Article 53 of Law 2224/94 and within the framework of written instructions dated 20.9.1994 
from ETBA S A. (basic creditor and shareholder of V1EL S-A.) 

ANNOUNCES 

a second repeal public auction for the highest bidder with sealed, binding offers for the purchase, as a whole, of the total assets of VIEL S-A. 
now under special liquidation. 

BRIEF DESCRIPTION OF THE COMPANY 

VIEL S.A was established in 1981 (GovL Gazette 2627/81 ) and set up a modem industrial unit for the production of coated abrasives in the 
Patras industrial estate on a plot of about 12,806m 1 . The factory has a surface area o 3,568 nr and auxiliary buildings an area of 586m 1 . The 
basic machinery was built and installed by BRUCKNER of Germany and JGELof Austria. 

During the first months of liquidation the company was semi-operational. However, in April 1993, as a result of serious financial problems, 
the factory was closed and is now non- operational. 

TERMS OF THE AUCTION 

1. Interested parlies are invited to receive from the Liquidator the Offering Memorandum and draft Letter of Guarantee in order to submit a 
sealed, binding offer lo Ihe noiary public appointed to the auction. Mrs Andriani-Dimitra Zaphciropoulou-Economopoulou, 18 Voukourestiou 
SL. 5th floor, Tel. +30-1-361.8249 up to Monday, 5th December 1994 op to 1400 hoars- 

Offers must be submitted in person or by a legally authorised representative. ! 

Offers submilled beyond the staled time limit will not be accepted or considered. 

2. The bids will be unsealed before ihc above-mentioned notary on Tuesday. 6th December 1994 at 1200 hours, with the Liquidator in 1 

attendance. Parlies having submitted bids wilhin the prescribed lime limit arc also authorised to attend. I 

3. The sealed, binding offers must dearly slate the offered price and method of payment (cash or credit, the number of instalments, the time I 

period over which the payments arc to be made at a fixed interest rate during the entire period of settlement). j 

4. Offers shall be null and void unless accompanied by a letter of guarantee from a bank legally operating in Greece. The letter will be valid 
until the signing of the contract and will be to the amount of fifty million drachmas (SO, 000,000) for VIEL SA. - COATED ABRASIVES 
INDUSTRY. 

5. The Company’s assets and all fixed and circulating elements that comprise them, immovables, movables, claims, rights etc. are to be sold 
and iraiusTcrrcd as is and where is. and. more specifically, in their actual and legal condition and location on the dote on which the sale 
contract is signed, regardless of whether the Company is operating or not,. 

6. The Liquidator, the Company and the creditors representing 51% of the total claims against the Company (Law 1892/90. article 46a, para. 

1 as in force), shall bear no liability for any legal or actual defects or for any deficiency in the particulars of tbe effects for sale or rights, nor 
for their incomplete or faulty description in rhe Offering Memorandum and in any correspondence. In tbe event of inconsistencies, entries in 
the Company's books, as they stand on the dale of signature of the sale contract, shall prevail. 

7. Prospective buyers, hereinafter referred to as Buyers, shall be obliged, on their own responsibility and due care, and by their own means 
and at their own expense, to inspect Ihe object of ihe sale and form their own judgement and declare in their bids that they are folly aware of 
the actual and legal condition of the assets for sale. The Buyers are hereby reminded that, in accordance with the provisions of the law, the 

i Buyers, having agreed in writing to maintain confidentiality, may receive the Offering Memorandum and may have access to any information 
they may require concerning the Company for sale. 

8. Offers must not contain terms upon which their bindingness may depend or be vague with regard to the height of the amount offered or its 
, method of payment or to any other essential matter affecting the sale. 

9. On all points concerning Ihc business plans of prospective buyers (job positions, height of investments, duration of operation, etc.) as well 
as on any other terms that may be agreed upon, the Buyer must accept clauses and other terms which will guarantee adherence to 
commitments, in order to guarantee payment of the amount on credit, the sale contract will contain a dissolution clause and first mortgage, or 
other guarantees (bank guarantee, etc.) lo be considered adequate by the creditors. 

10. The highest bidder is the one whose offer has been evaluated by the liquidator and judged by (he creditors as being the most satisfactory. 

1 1. In the event that the parly to whom Ihe assets for sale have been adjudicated fails in his obligation to appear and sign the relative contract 
within twenty (20) days of being invited to do so by the Liquidator, and abide by the obligations contained in tbe present announcement, then 
the amount of the guarantee staled above is forfeited to the Liquidator to cover expenses of all kinds, time spent and any real or paper loss 
suffered by himself and by ihe creditors with no obligation on his part to provide evidence of such loss or consider that the amount has been 
forfeited as a penally clause, and collect it from ihe guarantor bank. Leueis of guarantee accompanying foe offers of other bidders, except the 
highest bidder, will be returned to them immediately after the adjudication of the auction. 

12. The Liquidator bears no responsibility or obligation towards participants in the auction, both with regard to the dialling of the evaluation 
report on the bids or to his proposal of the highest bidder. Also he is not responsible and has no obligation to participants in Ihc auction in the 
event of a cancellation or nullification of the auction for any cause or reason whatsoever. 

13 Participants in the auction who have submitted bids do not acquire any right and can make no demand or claim on the strength of this 
announcement or of their participation, against the Liquidator or the creditors for any cause or reason. 

14. The transfer expenses of the assets for sale (taxes, VAT charges on foe value of the movables, stamp duty, notary fees and mortgagor 
fees, rights and other expenses for drawing up topographical diagrams as per Law 651/1977, etc) will be home by Ihc buyer. 

15 Participation in the auction implies acceptance of the terms of the present announcement 
For any further information please apply to: 

a) GREEK EXPORTS S.A. 1 7 Pancpislimiou Street (1st floor), Athens, Greece. Tel. +30-1 -324.31 1 J - 1 15 Fax; +30-1-323.9185 
K> The head office of ETBA S.A. Holdings Department, 87 Syngrou Ave, (4th floor) Athens, Greece, Tel. +30-1-929.4611 and 929.4613 


As" 







12 


FINANCIAL TIMES FRIDAY NOVEMBER iLU^T ^ 


PEOPLE 

More bang for ‘pretty boxes 1 


THE PROPERTY MARKET 


Derek Mottershead, 47, the 
former chief executive of Pron- 
tap riot, has been given the job 
of putting the bang back into 
the UK business of Bang & 

Otulsen, the 70-year-old Danish 
family firm which makes spe- 
cialist TV and audio products. 

Bang & OhiEsen, a minnow 
in a market dominated by mul- 
tinationals, Tnarifl a Qflmg for 
Itself because of its Hair for 
design and clever technology. 
However, the company lost its 
way at the end of the 1980s and 
sales in the UK. which was 
once the company's biggest 
overseas market, have fallen 
by around two thirds from a 
peak of around £40m a year. 

Just over three years ago a 
new management team took 
over in Denmark and the com- 
pany's fortunes have been 
recovering. Mottershead, who 
started out as a Cadbury 



Schweppes' brand manager, 
believes that Bang & Olufsen's 
problems in the UK stem foom 
a perception that its products 
are “very high-priced and too 
design-orientated". There is a 
lot more to the group than 
“pretty boxes”, says Motter- 
shead. 


While most of Bang & Oluf- 
sen’s competitors concentrate 
on volume and prices, Motter- 
shead believes that the key to 
success is to use the combina- 
tion of the Danish firm's tech- 
nical innovation and styling to 
promote “life style" products. 

Mottershead, a former chair- 
man of the British Franchise 
Association, joined Pronta- 
print, the Darlington-based 
print and business service 
franchiser, in 1987 and doubled 
turnover over the next four 
years. The company was taken 
over the following year and in 
September 1992 Mottershead 
led a management buy-out. He 
resigned as chairman and man- 
aging director of Prontaprint 
in August 1993 because he says 
that be was fed up with com- 
muting between two homes at 
either end of the country. 

William HaU 


Lloyds: limbering up in Latin America 


Time was when the Bank of 
London and South America 
was one of the biggest names 
around in Latin American 
banking. No longer. And Latin. 
America was one region of the 
world where its successor - 
Lloyds Bank - has retained a 
significant presence as it pul- 
led in its hams elsewhere to 
concentrate on the British mar- 
ket. It and its subsidiaries and 
affiliates still employ 3.600 peo- 
ple in the region. 

For most of the debt-dis- 
tressed 1980s, however, it was a 
case of slimming down and 
staying put Now, with hopes 



growing about the region’s eco- 
nomic prospects, the h ank is 
thinking about moderate 
expansion. 

The two people charged with 
this are Freddy Gibbs (above 
left), a banker of 35 years’ 
standing who is based in S£o 
Paulo, where hell stay to be 
general manager of the bank's 


Latin America southern 
region. He will be responsible 
for the bank's operations in 
Brazil, Argentina, Paraguay 
and Uruguay and keep an eye 
of Chile, Peru and Bolivia. 

In Argentina, where the 
bank has been operating for 
130 years, the bank employs 
about 800 people, the same 
number as work in Brazil - 
where Lloyds also has a 51 per 
cent stake in the wholesale 
bank, Multiplic. 

Alexander Ashton (near left), 
a Lloyds banker since 1972 
with experience in Europe and 
the Middle East, takes over the 


■ Pizza Hut UK has found a 
replacement marketing 
director for Paula Vennells. 
who first was and then later 
wasn’t going to join from 
Dixons in the same capacity, 
before she decided that a job 
with Sears offered better 
prospects. 

The new marketing director 
will be Peter Maslen, a 
42-year-old Australian, who 
has been with the group for 
two years. Before tbis latest 
post he was vice-president and 
general manager of Pepsico 
restaurants, east Europe. 

Maslen spent 16 years from 
1976 with Mars before joining 
Pizza Hut He beld a wide 
range of marketing, sales and 
manufacturing posts with 
Mars; his ultimate job with the 
company was regional director 
and general manager in Asia. 

■ Ron FbakeshefT. chief 
executive of Bowater Windows, 
has be en ap pointed to the main 
BOWATER board. 


northern region and will be 
based in London. He will be 
responsible for the bank’s 
operations in Honduras. Gua- 
temala, P anam a, Ecuador and 
Colombia. “One thin g we hope 
to do is get more involved in 
the financing of trade within 
the region which is growing 
quickly but quietly at the 
moment." he says. 

Stephen Fidler 

■ David Ball an ce and William 
Davies have been appointed 
directors of THREAD NEEDLE 
INVESTMENT 
MANAGEMENT. 

■ Robert Clarke has been 
promoted to the board of 
ELECTRA KINGSWAY. 


CEGB sparks de Sausmarez’ investment career 


The Central Electricity 
Generating Board would not 
seem to be the best starting 
block for a career in fund man- 
agement. But it doesn't seem 
to have hampered the rapid 
rise of James de Sausmarez 
who has just got the job of 
running Henderson Adminis- 
tration's retail division. 

De Sausmarez, 35, joined the 
Touche Remnant investment 
trust group from the CEGB as 
company secretary in 1986 and 
was not appointed a manager 
in the investment trust depart- 
ment until April 1990. 

Following Henderson’s 
acquisition of TR in December 
1992. de Sausmarez was put in 
charge of the combined Hen- 
derson Touche Remnant 


Investment Trust operation 
and has been responsible for 
the rapid growth of one of the 
more successful parts of Hen- 
derson’s £13.7bn fund manage- 
ment business. 

In some respects de Saus- 
marez is following in the foot- 
steps of Paul Manduca, 42, the 
former bead of Touche Rem- 
nant who was made managing 
director of Henderson’s retail 
business following the take- 
over just under two years ago. 
Six mo nths ago Manduca quit 
to head Threadneedle Asset 
Management. De Sausmarez 
will have the same title as 
Manduca bnt he has not been 
given a seat on the board and 
will not be in charge of Hen- 
derson's private client 



operations. He will remain in 
charge of Henderson's £3.7bn 
investment trust business and 
is adding overall responsibility 
for the £1.4bn unit trust opera- 
tion headed by Richard Eats. 

Despite de Sausmarez’s rapid 


rise, it is understood that he is 
unlikely to follow in Mand- 
uca's footsteps as the heir 
apparent to Jeremy Edwards. 
57. Henderson’s managing 
director who is expected to 
retire within the next two 
years. Henderson is understood 
to be looking outside for 
Edwards' replacement. 

■ David Watson. 35. formerly 
director, finance, at NatWest 
Securities, has been appointed 
to the same job at the M & G 
Group. It is not a board 
appointment but Watson will 
be the group's senior financial 
officer. Caroline Baker. 40, 
head of personnel at Towers 
Perrin, TillinghasL has been 
appointed head. of personnel at 
M & G. William HaU 


A t a secret meeting at 
the Department of the 
Environment last 
week, representatives 
of property owners, tenants 
and the professions started dis- 
cussions aimed at changing the 
face of commercial leases. 

Although the government 
said in July that it would not 
use legislation to abolish estab- 
lished practices such as 
upward only rent reviews and 
confidentiality clauses, Mr 
Tony Baldry. the environment 
minister, called on the indus- 
try to encourage flexibility on 
lease terms. 

While many property owners 
hoped that the minister's state- 
ment would be the end of the 
matter, last week's meeting 
proves that the issue of lease 
reform is very much alive in 
the corridors of power. 

This should nor come as a 
surprise. In July. Mr Baldry 
said that the government 
would took again at the opera- 
tion of commercial leases in 
three years' time to see if the 
property industry had put its 
own house in order. 

Given the state of the opin- 
ion polls and with a general 
election due by 1997, that 
might seem like an idle threat 
But there is every chance that 
an incoming Labour govern- 
ment would see political 
advantage in championing the 
tenants' cause. 

So what exactly does the 
government want? Mr Bal dry's 
July statement gives some 
clues. The minister called for 
an industry-wide code of prac- 
tice which would draw atten- 
tion to the implications of 
upward only rent reviews and 
encourage flexibility on other 
terms. 

The code should also encour- 
age greater openness - pre- 
sumably by discouraging confi- 
dentiality clauses, which 
prevent tenants sharing infor- 
mation on rents - unless there 
are compelling reasons to the 
contrary. 

Above aJL a code of practice 
sbould Lead to a change of 
| behaviour in the marketplace. 
The British Property Federa- 
tion. which represents large 
landlords, has already taken 
the initiative by proposing a 
code which would remind ten- 
ants of their rights and draw 
attention to the possibility of 
negotiating different terms. 

Mr Roger Carey. BPF presi- 
dent, said: “A 'health wa rning * 
of this kind would be very 
valuable and would do much to 
promote the flexibility in lease 
terms sought by tenants. Very 
importantly, it would not make 
the mistake of trying to inter- 


Looser 
lease terms 

Simon London on calls for an 
industry-wide code of practice 



It is not clear 
that occupiers 
fully appreciate 
the strength of 
their bargaining 
position' 


Todv Baldry 
Environment minister 


fere in the position of the par- 
ties but would leave than free 
to negotiate within prevailing 
market conditions.” 

The BPF argues that any- 
thing more prescriptive than 
this would alienate landlords 

“A Code of Practice which is 
not acceptable to owners will 
not be used and the whole 
issue will go back into the 
melting pot,” Carey said. 

But neither is it clear that a 
health warning would have 
much impact on market behav- 
iour, in which case the govern- 
ment could amply return with 
legislation in three years' time. 

The question is whether the 
EPF’s proposals simply need to 
be strengthened or whether the 
code of practice needs to be 
more prescriptive. 

The tenants' side of the argu- 
ment is put forcefully by the 
British Retail Consortium. Mr 
James May, director general, 
argues that landlords are in a 
much stronger position when 


T he BRCs argument is 
that retail landlords 
can he in a monopoly 
position, owning the 
prime sites in a particular high 
street or shopping centre. In 
such circumstances market 
forces do not operate effec- 
tively. 

Retailers would like more 
flexibility on the lease terms 
that landlords are prepared to 
accept. That might include 
more rents linked to turnover, 
upward and downward rent 


reviews,- and shorter 
“If wa have- -to pay.fagW 
reads for more JQexfrte teimj so : 
bett," saidMrMay. ,., r vv:\ 
Tfca BBC wotdd Kke a code., 

aC nun Inn nnn mil, . 


negotiating with retail tenants 
than with office or industrial 
occupiers. 

“The retail market is differ- 
ent becaus e location is so 
much more i m p o rtant Retail- 
ers need to be in certain prime 
locations of which there is lim- 
ited supply often in the hands 
of a single owner. In these situ- 
ations the balance of power is 
tilted too for in favour of the 
landlord,” he said. 


greater range of leaseopHoas' 
far tenants and believes that 
something stronger than a , 
health warning is required. : 

The int ere s t s of anrnfr fcqsi- 
' ness -.fondksnte.ahdtename - - : 
also have to Be taken into 
account ft is often the case 
that small landlords nfr aav.: 
long-term secure incojtie 
almost like a pensfcm. Krabig; . 
these owners to accept mate 1 ; 
flexible lease ^ teams codM. hare 
anunpalatehtedde^ffleris, ■ ' . 
- ' The professional bodies sadi- 
as the Royal Institution ef- 
Chartered S u rve y ors mad- tire? 
Law Sodetyare -caught to the 

middle of thin jn gmtMBW - . Tfag .: 

institution, fix particular, has 
to represent' the interests -of 
landlords, tenants and their 
professional adrisere. : y:.-; 

Mr Richard Lay, chairman 1 of . 
DTZ Debenham 'Thorpe,, the' 
s u rvey o rs, and the institution^ , 
commercial property spokes- 
man, said: "The government 
instructed the; industry to dp 
something out of the .Mae. Tbs ' 
first step is to try : te: dedde . 
what is achievable on the land- 
lords’ side and wbat is accept 
ahte to tiie tenants.* ’ : • 

The question' is whether the -. 
legitimate, falsest of aO land- 
lords fa a secure income can be 
squared with the desire ctftan* 
ants fpr greater diversity of ; 
lease terns without an element - 
of compulsion. 

Shorter, more flexible leases 
became widely available 
through recession as landlords 
found their ten yptemg position' 
weakened. The traditional 25- 
year "fastitntkmal* lease has 
been reduced to 15 yean or - 


Mr Baldry appeared to 
acknowledge as much, fa July, 
when he said; “it is evident 
that the market is now provid- 
ing a greater variety of lease 
terms'. . . especially the avail- : 
ability of short leases". . 

The danger is that leases win 

hpmmp longer and tens fl erihTe 

as the economy improves and 
the balance of power tflte.back 
fa favour of landlords to a 
degree that the government , 
views as unacceptable. 

Despite taking a hard Hue fa - 
public, many big landlords 
recognise that they may have , 
to give away slightly more 
than the EPF’s “health warn-: 
fag” proposal to avoid legisla- 
tion. It is now up to tenants to 
articulate more clearly what 
kind of code of practice they' 
would Hke; 


COMMERCIAL PROPERTY 


Grande 

GOLF COMPLEX ESTABLISHMENT 
LAND FOR SALE 

(Development Approved Site) 

- 15 minutes drive from the Charles de Gaulle airport and within 40 km from Paris. 
Position: Commune de Montge en Goele, Seine et Marne, France 
Total Ground Area: 1,139/370 m 2 

(27 Holes + 5 Academy Holes) 

Building Area: (Hotel, Residence & Clubhouse) 

Building Available Zone * 89,700m 2 (Total Floor Area = 17,940m 2 ) 

(Approved, a hotel with 118 rooms and a residence building with 78 rooms) 

Owner: Euro-Grande SA., 10 rue de la Paix - 75002, Paris, France 
(A branch of the Grande Development Co. Ltd., Japan) 

Price: FFR 26,000,000.00 

• Golf Course Designer Mr. Donald Sled 

• Drawings of the golf ccuree, hotel and residence arc available 

• Permission for construction of the golf oouise, hotel and residence 

Mr. Zen Okavva 

Managing Director of Euro-Grande S.A 
c/o Mondial SA. 

149 rue Saint Honore, 75001 
Paris, France 

Fax: +33-1-40 20 92 91 


OPERATIONAL HOSPITAL 

The Royal Masonic Hospital, 
Ravenscourt Park, London W6 

FREEHOLD 

Currently an Operational Medical Facility 
with Potential for Alternative Uses including 
Redevelopment (Subject to Planning) 

Comprising 325,000 sq. ft. of buildings 
Potential for 200 beds 
5et in approximately 8.5 acres 

WRITTEN EXPRESSIONS OF INTEREST ARE INVITED 
ALL ENQUIRIES 


Chesterton 


0171495 7282 


VWV. House 17 Great Cumberland Place 
London W 1 H TLA 


Will 


bph 


On ihe instruction or Barclays Property Holdings Lid 

BRIDGETOWN, BARBADOS 



-fHI'VI 


■mm 


30,000 square feel offices 
Suitable for development 
Freehold, adjacent to Civic Centre, Bridgetown 


SMITHS GORP 

inv'iiMi limited 


London 

Tel (1171 222 4054 
F*i\ III7I 222 7IJ5 


British Virgin Islands 
Td 1X01 41(42446 
Fa* (8CN 41j 42141 


REALTORS 

LIMITED 

Barbados 

Td [HOT I 4J2 61.10 
Fax 18 OTI 432 WI1 


Avaifablefor 
immediate occupation 
Office premises 

ill Berlin Business & Living: 

• jily furnished c‘f:s-:-s ccr:- 

's.'tciei-:- overran: 3:coe\“ecn- 
Telephone-, fsr, TV, r-cio, 
luxury SPG’. vc r ?3C: :ty Ran- fixed 
’Or 3 to 3 years Snow cilices 
2 vsilssls ‘'or v: sw nc fore o au r 
erocruro, cont'acf 

KI2 LS 3s cor GnaH i Co. 


;55 t 0 20-7 71 01 91 


EDGWARE 


OFFICE BUILDING 

From 360-6,025 Sq. Ft 
6 On Site Car Parking 

TO LET 

Contact Ref- MC 


I ; > HENRY 
i^>BUTCHER 


071-405 8411 



your 

* 

stitch be 
in time? 

To acquire the only 
6.000 sq ft office 
buildinq in one of 
Mayfair's premier 
Squares. 

Write to Box B2456, Financial Times. 

One Southwark Bridge, 

London SEl 9HL 


For Sale 

in Zambia 

Prime commercial and 
light industrial properties. 
Prime residential 
properties. 

Please contact 
fox: -*41-92-26 1312 
in Switzerland 


UK 

PROPERTY 

SURVEY 

Publication Date: 

9 December 1994 

For further information 
contact: 

SOPHIE CANTILLON 
Tel: 071 873 3211 
Fax: 071 873 3098 


GREEK EXPORTS 

(Founded & owned by ETBA S~A.) 

DENATIONALISATION 

INVITATION FOR EXPRESSIONS OF INTEREST IN PURCHASING THE ASSETS 
OF HELLENIC MARBLES SA. NOW UNDER SPECIAL LIQUIDATION 

GREEK EXPORTS SJL, established in Athens at 17 Panepisttmous Street, in its capacity as j 
special liquidator of HELLENIC MARBLES S-A. (in accordance with Decision. No. 7518/1992 
of the Athens Court of Appeal, by which HELLENIC MARBLES S A. has been placed under 
special liquidation) and within the framework of article 46a of Law 1892/90, as supplemented by 
article 14 of Law 2000/91 and complemented by article 53 of Law 2224/94 following the written 
statement (Ref. No. 1725/94) of the creditor under para. 1 of the above article, 

INVITES 

interested investors to express their interest fa purchasing the assets of HELLENIC MARBLES 
SA. now under special liquidation, by submitting a non-binding, written expression of interest 
within twenty (20) days form today. 

HELLENIC MARBLES SA. was founded in 1961 and was engaged fa quarrying, p rocessing 
and selling marble and its by-products. 

The company's installations are situated on self-owned land 48,387 m™ in area at Aghios 
Stefan os, Attica. The company's assets can be sold as a whole or as separate entities as follows: 

a) Real estate consisting of the land and buildings 

b) Mechanical equipment for marble quarrying 

c) Mechanical equipment for crushing and grinding 

d) Mechanical equipment for cutting and processing marble 

e) A plot of land 3.000 mr fa area fa the Argalastis area in Volos 

f) Parcels of agricultural land on the island of Tinos, 14,000 m 2 in area 

OTHER DETAILS CONCERNING THE PUBLIC AUCTION 

I. Interested buyers should submit, within twenty (20) days of publication of the present 
invitation, a non-binding, written expression of interest. 

H. Prospective buyers, on providing a written undertaking of confidentiality, may receive the 
offering memorandum from the offices of the liquidating company. 

They shall also have access to any other information they may seek and may visit the 
premises of the company under liquidation. 

HI. The offering memorandum will describe in detail the total assets of the company for sale and 
will contain every useful information for the prospective buyer. 

The procedure foi the public auction for the highest bidder will be published within the 
prescribed time limits and in the same newspapers. 

For any further details or information please apply to: 

a) GREEK EXPORTS SA^ 17 Panepistimiou Street, (1st floor), Athens, Greece TeL +30-1- 
3243111 Fax: +30-1-323.9185. 

b) The head office of ETBA SA. Holdings Department, 87 Syngrou Avenue (4th flborL 
Athens, Greece. TeL +30-1-929.4611 and 929.4613. 


For sale 


ST NEOTS, CAMBS 

South Al/ 

14 link warehouse 1Q.623H 2 
on land, total site 1.05a, 
potential for development 
FOR SALE/LEASE 


OERO £270,000 

1 hour from London, 1930s 
large 4 bed bouse, set in 15 acres. 
River Ouse frontage, small lake, 
old born, sheet range/towers 
(14 day rule applies) 

GREAT BARTORD, BEDFORDSHIRE 
Td: 81480 214300 Fan 01480218987 


former Teesside refinery 

Port Clarence Stockton on Tees 

total she are a 47J acres 

■ Wharf fadntias to River Tees 

■ Immediately to the North of Middlesbrough Town Centre 

■ Within die heart of the chemical and petro-chemical centra 
of Teesside 

■ Nearby occupiers include PhUips Petroleum, id. 
tor fcnttMr details apply: 

Debenham 
Thorpe E&ilrcSiS 




ku JU4 



& 


Vivte r IV 












FINANCIAL TIMES FRIDAY NOVEMBER II 1994 


13 





ARTS 


Musical farce 
and honour 

Andrew Clark visits the Massenet 
festival in Saint-Etienne 


N o French city has found 
a niche in the music 
market as deservedly as 
Saint-Etienne, home of 
the biennial Massenet festival. Dur- 
ing his lifetime, the composer 
turned his back on his birthplace, 
and the city today - a dowdy min- 
ing centre just off the massif central 
- is a tourist's disaster area. But to 
recent years Saint-Etienne has 
developed a useful business in Mas- 
senet revivals, and the music world 
is taking note. 

First came Amadis in 1988, then 
Cl6op6tre in 1990, Esclarmonde and 
Qris&tidis in 1992, and now Pamtrge 
and Le Cid. Thais and Marie- Magde- 
leme are promised for 1996. When 
yon consider how little the French 
have done to explore the lesser- 
known works of Berlioz or Cha- 
brier, Saint-Etienne is serving Mas- 
senet rather well. 

The local opera company throws 
FFr9.5m (£l.lm), or 25 per cerrt of its 
annual budget, into ten days of 
music. Sponsorship from France 
Telecom and a recording deal with 
Koch-Schwann help to pay for the 
soloists. At the last two festivals, 
money seemed plentiful. This year 
bore signs of cost-paring and under- 
preparation. Unlike 1992, the local 
orchestra shouldered the burden of 
work alone - which may explain 
the sub-standard playing in Pan- 
urge. Few of the principals showed 
the familiarity with their roles that 
one expects at a festival. 

Pamtrge, a three-act musical 
farce, had not been performed since 
1913, the year of its posthumous 
Paris premiere. Based on a novel by 
the 16th century French writer 
Rabelais, it tells of the misunder- 
standings, adventures and eventual 
reunion of Panurge and his wife 
Cotombe. Some of the action has a 
whiff of sit-cam - as when Colombe, 
trying to make her errant husband 
jealous, confesses her supposed infi- 
delities to a gossiping priest, who is 
none other than -Panurge in dis- 
guise. The muj rin is ali ght and full 
of parody (has any other composer 
written a sheep's chorus?), and 
there lis some subtle 16th century 
pastiche. But Massenet could have 
written it in his sleep. 

The Saint-Etienne production. 


staged and designed by Adriano 
Sinivia, looked more like a 
half-baked Gozzi pintnmimp than a 
comedy of the sexes a la frartcaise 
The mobile toy-box sets resembled a 
children's playpen; the costumes 
could have passed muster for Jack 
end the Beanstalk. Worst of all, the 
action was no naughtier than a 
Sunday school tea-party. The work 
cries out for the irreverent 
approach of a J&rbme Savary. But 
Pamtrge is unlikely to get another 
chance. 

Stronger characterisation of the 
principals would have helped. The 
title role - written, like Don Qui- 
chotte. for a basse chantante - 
requires greater comic skills than 
Jean-Philippe Courtis could offer. 
He was too noble in bearing, too 
frayed of voice. Colombe, an unusu- 
ally down-to-earth Massenet hero- 
ine, was decently sung but unimag- 
inatively acted by H6Idne 
Perxaguin. Desmond Byrne's Pant a- 
gruel. imprisoned for much of the 
evening in an outsize mechanical 
costume, was a strait-laced master 
of ceremonies. The casting of 
smaller roles was barely adequate. 

Saint-Etienne’s young music 
director, Patrick Foumillier, drew 
much more secure playing in Le 
Cid: it was hard to believe that the 
clarinet obbligato in the famous 
soprano aria “Pleurez, pleurez mes 
yeux” came from the same orches- 
tra as the scratchy violin soloist in 
Pamtrge. But the chorus was differ- 
ent - and what a disciplined sound 
the Lyon Opera chorus made! The 
fact that Le Cid was being recorded 
had clearly mfimmrnri the alloca- 
tion of rehearsal time. 

Based on Corneille’s play of love 
versus honour, Le Cid is a four-act 
grand opera in the Meyerbeer tradi- 
tion, written immediately after 
Mantm and before Werther. it may 
lack their intimacy, but it shares 
their creative vitality. The concert 
setting, with only two minor cuts, 
underlined Massenet’s skill as a 
musical dramatist: heroic writing 
for tenor and soprano, atmospheric 
choruses, a sense of urgency in the 
duel some, and ballet music in the 
best French tradition of fake Span- 
Ishry - all infused with characteris- 
tic refinement It was written for 



first-class voices (the De Reszke 
brothers among others), and 
demands a spectacular staging. 
Saint-Etienne provided neither, but 
somehow got away with it 
Mlch&le Command was the formi- 
dable Chim&ne, a little unyielding 
in the ge ntler moments but rock- 
steady in attack. Chris Merritt was 
a rough-and-ready Rodrigue, lack- 
ing the tonal resonance and clarion 
ease the part demands. As Don Did- 


gue, Jean-Philippe Courtis was in 
better voice than his Panurge 24 
hours earlier. Marcel Vanaud was 
the stentorian king, and the veteran 
Gabriel Bacquier made a short but 
effective contribution as the Count 
of Gormas. Maryse Caste ts's pure 
soprano was ideal for the Infanta. 

Le Cid was preceded by a recital 
by Didier Henry, the young French 
baritone who - like most soloists at 
the festival - spends most of his 


time on the French provincial opera 
house circuit His opening Massenet 
group was marred by offstage noise 
and a husky tone q ualit y, but the 
voice took wing in Ernest Morefs 
“Tu me donnas ton coeur", reveal- 
ing ample colour and an easy top. 
Best of all was the gentle melan- 
choly of Massenet's settings of 
poems by Armand Syivestre, beauti- 
fully accompanied by Angehne Pon- 
depeyre. 


N 

!•< ’ 5? WN 


nn Spanish savings bank 
I “la Caixa", based fau Baree- 

■ Iona, supports a diversity 

X of concerts, including an 
early music festival now in its lSth 
year, and has just started a contem- 
x porary music festival. Looking at 
?" nniy to international celebrity and 
local talent this inaugural venture 
• THE *.'>£!? featured the music of America’s 
; n Tjm senior composer Effiott Carter (86 in 

December) and of the notable Barce- 
lona-born (in 1935) and based com- 
poser, Josep Soler. 

- \ The first of the concerts I 

■" attended was given by the London 

• - Sinfonietta and its new chief con- 

/ _ ductor Markus Stenz in the Funda- 

d6 la Caixa's Centre Cultural Cart- 
er's 1961 settings for tenor and 
ensemble of six sonnets by Robert 
Lowell, fh Sleep, in Thunder (a Sin- 
fonietta rammrission), came across 
in their marvellous intricacy with 
pungent force if not much tonal 
beauty, a lack due not only to the 
acoustics but to something insis- 
tently plain-voiced about the other- 
wise impressively deft singer Jon 
Garrison and to something stub- 
bornly tm ly rical in Carter’s none- 
theless intelligent vocal writing. 

Josep Soler was represented by a 
short neo-classical concerto for 
harpsichord and five instruments 
which he wrote in 1969 to comple- 
ment the famous work by Falla and 

' * 


Concerts in Barcelona and London/Paul Driver 

Contemporary and Russian sounds 


which the Sinfonietta recorded back 
in 1976. The soloist, John Constable, 
conducting from the keyboard, 
secured a lively account of this 
sweetly bristling 12-tone music, 
though one discovered from next 
evening's concert that the taut 
idiom no longer reflects Soler’ s 
approach. His Dos poemes per a 
orquestra (1990-93). performed by 
the Orquestra simf&nica de Barce- 
lona national de Catalunya under 
Josep Pons, proved a somewhat neo- 
romantic affair , the first practically 
a concerto for pastoral oboe and 
rustling curtain of divisi muted 
strings with unlikely touches from 
synthesised organ; the second whip- 
ping things up a bit with a wind 
machine. Soler’s language seems to 
have become dangerously eclectic, 
dicing with kitsch. 

The two big movements of Elliott 
Carter’s 1965 piano concerto were 
complex not in a playful but a geo- 
metrical way: a dense, often dark 
labyrinth. The American Ursula 
Oppens was the staggeringly daunt- 
less, highly experienced soloist. 
Pons and the orchestra, with its 
concertino group gathered round 
the piano, performed with truly 


admirable courage and conviction, 
though never approaching an ideal 
balance of forces and seldom find- 
ing the ease and confidence to ani- 
mate their jaggedly expressive poly- 
phonic lines rather than just 
execute them. 

E arlier in the week Oppens 
gave the Spanish premiere 
of a five-minute piano 
piece, 90+. which Carter 
recently added to his ongoing series 
of luminous little tributes to col- 
leagues, in this case the nonagenar- 
ian Italian composer GoBredo 
Petrassi. Pitched at a technical level 
which should not exclude the gifted 
amateur, it is a perfect epitome of 
Carter’s dazzling metrical style and 
is built cm 90 repetitions of the same 
pulsation, and then some more, as 
though to wish Petrassi a few years 
yet of active life. One certainly 
wishes Carter the same: he has just 
completed an orchestral piece for 
next year’s Proms and is at work on 
a voice and piano song-cycle for 
next year’s Aldeburgfa Festival. 

★ 

Russian music of very diverse char- 
acter was played in two concerts an 


consecutive evenings at the Royal 
Festival Hall by two orchestras, 
both conducted by Russians. On 
Tuesday the Royal Philharmonic 
under its principal conductor Yuri 
Temirkanov gave a neatly con- 
trasted, slightly daring programme 
which began with Prokofiev’s Suite, 
Op. 33a from his 1919 opera. The 
Love for Three Oranges. These six, 
wonderfully crisp and witty move- 
ments were executed with panache. 

Rachmaninov’s three Symphonic 
Dances Op. 45 of 1941 were brought 
off well enough but seemed all the 
more jadedly conservative with the 
concert's marvellous middle item, 
the Concerto for Piano and Strings 
(1979) by a living Russian, Alfred 
Schnittke, still echoing in the mind. 
This often harshly dissonant work, 
Schnittke's third piano concerto, in 
this superbly thoughtful, elegantly 
shaped, powerful account, with 
soloist Dmitri Alexeev, came over 
as no more alienating than a darker 
piece by Sir Malcolm Arnold. The 
music, like Arnold’s, touches on 
jazz and the RPO's principal double 
bass. Jack McCormack, plucked out 
his cabaret tones with style. 

Though the concerto does, indeed. 







presented as recognisable 
indhriduats, whfle at the same 
tone serving as models fora role 
or general figure-type without 
specific character. 

There wiH be a chance to see 
raw ly cx tdbftad paintings from 
private coHec&ons, as well 
better-known portraits - such as 
Femme & la fenfitre from the 
Courtauld Institute in London, La 
femme en gris from the New York 
Metropolitan and ^Vtotontete et 
jetme femme from Detroit 



tockt° n 







■sri *" 1 




«• 

V: 


i 


Degas portraits 

A major axhfoftion of portraits try 
Edgar Degas (1834-1917) Is being 
prepared by the Zurich _ 
Kunstfiaus In co-operation with 
flu TOUngen KunsthaUe. 
Sponsored by Credit Sufesa, ffte 
show opens In Zurich on 
December 2, and wffl move to 
TUbingen next March. 

Degas* earSost works as an 
independent artist were portraits: 
they count among Ms boldest 
paintings, remmtafotefw their 
Intimate (firectnen and 
innovative handling of form, 
posture and setting; tfs sitters 
were htetemtiy and friends - 
people whose habits and 
fc. character he knew, and yet whom 

■ he was abte to observe without 

sentime n tality. 

The exhibition wffl explore the 
overlap in Degas* work b etwee n 

the portreft proper and narrative 

genre painting, and the way 
Degas used ffie portrait to 
represent not just the person but 
also their vocation or activity. 
Degas' sitters are often 


■ EXHIBITIONS 
AMSTERDAM 

Vlan Gogh Museum Qdflon Redon 
(1840-1916): 180 works exploring 
the artist’s development, sources 
and influences. Ends Jan 15. Dally 

Stedefijk Museum Asger Join 
(1914-1973): retrospective of the 
Danish artist Bids Nov 27. DaHy 
Rjjksmuseum Decorated Paper a 
remarkable collection of marbled, 
chintz and brocade paper 
manufactured In and imported Into 
the Low Countries from the earty 
17th century. Bids Feb 12. Closed 
Mon. 

BARCELONA 
Museu Picasso Picasso’s 
Landscapes 1890-1912. Closed 
Mon (Carrer Montcada 15-19) 
BERLIN 

Briteke Museum Earty Kandinsky: 
a survey of a little-known period in 
the German Expressionist’s 
development Ends Nov 27. Closed 

Attes Museum Hdorado: 
pre-Columbian gold treasures from 
South America- Ends Jan 8. Closed 
Mon 

DRESDEN 


Kupferstich Kabmett James 
McNeill Whistler: a rare German 
showing of etchings and 
lithographs. Ends Nov 25. Closed 
Sat and Sun 

Abertinum Christian Friedrich Gille: 
retrospective of the 19th century 
German landscape painter. Ends 
Nov 27. Closed Thurs 
FRANKFURT 
Judische Museum The 
Rothschilds: an evocation in 
painting of the 250-year history of 
the ferrous Jewish dynasty. Bids 
Feb 27 

Scbrm KunsthaUe Nicholas de 
Staei (1914-55): retrospective of the 
Russian-bom artist documenting 
his intense but tragically brief 
career. Bids Nov 27. Daily 
JafntiunderthaBe Hoechst 

Contemporary Art from the 
Collections of Frankfurt Banks. 

Bids Nov 20. Daily 
THE HAGUE 

Maurftshuis Paufus Potter's 
Animals: the first comprehensive 
exhibition of the work of Potter 
(1625-1554), the animal painter of 
the Golden Age in Netherlandish 
art Bids Feb 5. Closed Mon 
HAMBURG 

Kimsttia&e Rembrandt and his 
Century: Netherlandish drawings 
from the 17th century. Ends Jan 15. 
Closed Mon 

LONDON 

National Gallery The Young 
Michelangelo. Ends Jan 15. Daily 
Tate Gallery James McNeill 
Whistler the largest collection of 
the American-bom artist's work 
since the memorial exhibitions held 
after his death in 1903. Bids Jan 8. 
Rebecca Horn: a retrospective 
focusing on her extraordinary 
machines and installations 


(coinciding with another Horn show 
at the Serpentine Gallery). Ends Jan 
8. Daily 

Hayward Gallery The Romantic 
Spirit in German Art 1790-1990. 
Ends Jan 8. Dally 
Royal Academy of Arts The Glory 
of Venice. Ends Dec 14. Italian 
Renaissance Book Illumination. 

Ends Jan 22. Daily (advance 
booking 071-240 7200) 

Royal Festival Hall KSthe KoHewitz 
(1867-1945): a collection of the 
German artist's powerful and 
emotive prints. Ends Dec 4. Daily 
MADRID 

Fundactd la Caixa Kandinsky and 
Mondrian - Two Roads Toward 
Abstraction; an exhibition marking 
the 50th anniversary of the deaths 
of two great pioneers of modem 
art. Ends Nov 13 (after which it 
transfers to Barcelona), Closed Mon 
Fundadon Juan March Treasures 
of Japanese Art 110 works from 
the 17th to 19th century, on loan 
from Tokyo’s Fuji Art Museum. 

Ends Jan 22. Daily 
MUNICH 
KunsthaUe der 

Hypo-Kutturstiftung Edvard Munch 
and Germany. Ends Nov 27. Daily 
Villa Stuck Tom Wesselmann: 
retrospective of the American Pop 
artist. Ends Jan 15. Closed Mon 
Haus der Kunst Roy Lichtenstein 
retrospective. Ends Jan 9. Closed 
Mon 

Schacfc-Gaierfe Adotf Friedrich 
Graf von Schach: a show devoted 
to the widely-travelled 19th century 
art collector. Ends Feb 5. Closed 
Tues 

Lenbachhaus Tanzania* 400 
masterworks of African sculpture. 
Ends Nov 27. Closed Mon 

MUNSTER 


have tts violent outbursts, they are 
only some of the strangely assorted 
collection of musical objects - 
including a quiet Moonlight Sonata- 
like triplet figure for piano, a near- 
pastiche of the Russian Hymn from 
the 1S12 overture, and a giissan- 
doing string passage - which 
Schnittke’s apparently zany but 
actually ironclad argument shows 
to be all of a piece. Alexeev and 
Temirkanov held one enthralled by 
the music’s sheer dialectic. 

On Wednesday the BBC Sym- 
phony Orchestra under its principal 
guest conductor Alexander Lazarev 
gave the UK premiere of the single 
movement Symphony No 7 (1986) by 
the Armenian composer Alfred Ter- 
teryan (born 1929). His music is 
folk-influenced in a far from pictur- 
esque way. Here he writes an obbli- 
gato part for the folk percussion 
instrument called the dap’ (Timothy 
Darside), which sounded not unlike 
file Indian tabla. This sound was 
often multiplied 10 or 11 times by 
the percussion department, or ech- 
oed by a tape recording. A sort of 
musical prophecy of the Armenian 
earthquake of 1988. the symphony 
deals wholly in monolithic and aus- 
tere ritual gestures, minimalist in 
material whilst maximalist in rhe- 
torical power. A far cry from 
Schnittke's irony, but a cry deserv- 
ing of attention. 


Lartdesmuseum August Macke and 
the Expressionists in Westphalia: 
100 rarely-seen paintings of 
flowers, gardens and landscapes. 
Ends Jan 15. Closed Mon 
NEW YORK 

Metropolitan Museum of Art 
Origins of Impressionism: 175 
paintings by Parisian artists of the 
1860s. Ends Jan 8. The Annenberg 
Collection of Impressionist and 
Post-Impressionist Masterpieces. 
Ends Nov 27. William de Kooning’s 
Paintings. Ends Jan 8. Closed Mon 
Museum of Modem Art Cy 
Twombly (b1929): retrospective of 
the American artist who moved to 
Italy in 1957. Ends Jan 10. The 
Prints of Louise Bourgeois. Ends 
Jan 3. Mapping: an exhibition 
exploring the ways in which 
modernists have made map 
imagery a principal focus of their 
work. Ends Dec 20. Closed Wed 
Guggenheim Museum The Italian 
Metamorphosis 1943-1968: a 
survey of visual arts in the postwar 
period. Ends Jan 29. Japanese Art 
After 1945 (at SoHo). Ends Jan 8. 
The main museum is closed on 
Thurs, the So Ho site on Tues 
Brooklyn Museum Indian Miniature 
Paintings: 80 jewel-like paintings 
from the 15th to 19th century. Ends 
Jan 8. Closed Mon and Tues 
PARIS 

Grand Palais Poussin: 400th 
anniversary retrospective. Ends Jan 
2. Gustave Calllebotts (1848-1894): 
retrospective of the painter and 
patron of art who belonged to the 
circle of Impressionists. Ends Jan 9. 
Closed Tues. late opening Wed 
MusOe d'Orsay Forgotten 
Treasures from Cairo: a surprisingly 
rich collection of works by Ingres, 
Courbet, Monet. Rodin. Gauguin 


Theatre in London 

Suzuki ’s austere 
‘Tale of Lear’ 


T he Japanese often have a 
way with Shakespeare. 
Ore thinks particularly of 
Nlnagawa’s stage produc- 
tion of Macbeth and Kurosawa’s 
spectacular film Sen, based an King 
Lear. Both combined grace with 
brutality to bring the plays sear- 
ingly to life. 

Tadashi Suzuki ’s Tale of Lear 
(staged at the Barbican as part of 
the Everybody's Shakespeare Festi- 
val) has the austere beauty you 
might expect but it is equally one 
of the bleakest versions of Shake- 
speare’s tragedy I have ever seen. It 
is cruet cold and resolutely unmov- 
ing. 

Suzuki takes as his cue Lear’s inti 
ecus cry, “O! let me not be mad, not 
mad, sweet heaven”, and extrapo- 
lates from this a production that 
draws on the deep fear we all have 
of old age, loneliness and dementia. 
His Lear is not a king, but a solitary 
old man in a sanatorium, who is 
reading the play. He fells asleep 
and, as be dreams, the characters in 
the tragedy melt out of the walls 
(literally, it appears, on the inge- 
nious set of sliding doors) to act the 
play and suck him into it 
Soon he and Lear axe inter- 
changeable and we are not certain 
whether the characters are figments 
of his imagination or other inmates 
of the asylum. Suzuki deliberately 
blurs this distinction by having 
Edgar creep past in the background 
in his Poor Tom rags after the trag- 
edy is over. 

The play is distilled to under two 
hours, the all-male cast acting out 
only the harshest points of the plot, 
and nearly every redeeming feature 
is cut out There is no Kent, and 
Cordelia makes only the most fleet- 
ing of appearances, so that almost 
everyone on the stage is either mad 
or bad. Even the fool is replaced by 

Goldoni 


G ood playwrights write for 
actors, bad playwrights 
despite thpm Carlo Gol- 
doni (1707-93) wrote 
scores of plays that were gifts for 
actors - but gifts that challenged 
them. So it is dismaying to feel the 
Lyric Hamm ersmith's new version 
of his MhandoHna fall fiat The Gol- 
doni productions I have seen have 
taught me that, thoug h you 
stage Goldoni in a wide variety of 
ways, the key factor is vitality. 
Without spontaneity, without inten- 
sity, Goldoni evaporates, and we are 
left with little to watch but crummy 
old formulas. (Like Shakespeare 
and other great playwrights. Gol- 
doni was forever reworking mate- 
riaL) Here, the six actors all seem to 
be working in different styles, and 
everything is laborious. 

Mirandolina, an innkeeper, is 
very successful at getting men to 
fell in love with her - but she has 
to work hard to vanquish the Cava- 
here, an avowed misogynist She is 
no mere seductress; she has streaks 
both of the feminist and the andro- 
phobe. The air should be hill of 
intelligent contest Here, however, 
Caroline Quentin makes Mirandoli- 
na’s methods so obvious that the 
Cavaliere (Reece Dinsdale) seems a 
dolt The lines do not dance (though 
Quentin tries to make them do so); 
the actors underrate both Goldoni 
and the audience. They project 
forcefully into the theatre, but, 
because the personalities they proj- 
ect are stale, the effect is meagre. 

The director is Dalia Ibelhaup- 
taite. She directed a decent s ta g in g 
of Goldoni’s The impresario from 
Smyrna at the Old Red Lion this 
spring: decent, 1 now suspect, 
mainly because the tiny stage space 
gave the play an intensity that is 
utterly absent here. The most suo 


a nurse, a sinister, mocking body 
who seems to derive a sadistic glee 
from her charge's distress. 

In the confusion as to what is real 
and what is fantasy, Lear's tor- 
mented rambling about the cruelty 
of his children expresses the terror 
and paranoia that can afflict the 
elderly. Where Lear delivers his last 
speech about the finality of death, 
staring desperately at the audience, 
it seems be is chronicling his own 
demise and his fear of it, rather 
thaw tha t of his daughter. 

S uzuki infuses his production 
with traditional Japanese 
techniques, perfectly exe- 
cuted. It is statuesque and 
beautifully lit and the actors, clad 
in ornate robes, glide about the 
stage as though on Invisible castors, 
or scurry like leaves swept forward 
by a gust. 

Ulchiro Fueda as Lear himself 
moves with such slow, slow fluidity 
that he seems pulled by some invisi- 
ble force. His Lear Is grim and 
grudging, so unpleasant in his mad- 
ness that he is not even pitiable. 
The heightened style makes it hard 
to stay engaged at times, and both 
Goneril and Regan have a discon- 
certing habit Of rankling manirall y 
that puts you in mind of pantomime 
villains. For the most part, though, 
this sombre production is mesmeris- 
ing - but it never moves yon. 

Suzuki has said that he sees the 
world as a hospital and all its 
inhabitants as patients. On the evi- 
dence of Otis production, he holds 
out little hope for a core. As Lear 
dies on his own, agonised by his 
ravings and with no kind words 
afterwards to take away the sting, 
Suzuki preseats a cold, comfortless 
world indeed. 

Sarah Hemming 

falls flat 


cessful element of Mirandolina is 
alto the most bizarre: Ashley Mar- 
tm-Davies’s scenery, which includes 
surreal effects - eg a blue piano 
hang in g in the air - and daring 

dashes of colour. For the seduction 
scene, an orchard of suspended sep- 
arate fruit descends to head height: 
so that Mirandolina lead the Cava- 
liere through a Hang in g Garden of 
Eden, giving him bites of one apple 
after another. 

B ut Designer’s Theatre can- 
not carry Goldoni. Did 
Ibelhauptaite intend to 
elicit any correspondingly 
surreal acting style from her cast? if 
so, she has not succeeded. As the 
Conte. Graham Turner commits 
several cheap crimes: he employs a 
plebeian accent in an aristocratic 
role, he uses blatantly modem 
movements within exaggerated 
period costumes, and he tries mak- 
ing the same joke several times. 
The hangdog Robert Goodale is mis- 
cast as MSrandolina’s important ser- 
vant Fabrizio: no spark, too old. 
Tim McMuIlan’s Marohese is that 
worst theatrical type, a duU fop. 

Nobody listens to anybody else 
with any liveliness- Robert David 
Macdonald's new translation omits 
some minor characters, and, with 
them, some shrewd comedy. The 
En glish text has some clever “quo- 
tations’’ from Shakespeare - usu- 
ally, however, juxtaposed with 
unstylish expressions such as "1 
mean”. Poor Goldoni’s clever play 
about one woman's efforts to win 
the battles of love and power has 
crumbled into a feeble English sex 
comedy to period frocks. 

Alastair Macaulay 


Lyric Theatre, Hammersmith 


and others. Ends Jan 8. Closed 
Mon 

Louvre British Art in French Public 
Collections: paintings by 
Gainsborough, Reynolds, 

Constable, Lawrence and Turner, 
plus drawings, watercolours and 
engravings. Ends Dec 19. Closed 
Tues (Hall Napoleon) 

Mus6e Camavatet The English in 
Paris In the 19th Century, le style 
anglais in the aftermath of the 
Napoleonic ware, comprising 
French caricatures of the English 
milord rod English painterly 
evocations of Parisian excesses. 
Ends Dec 11. Closed Mon (23 rue 
de Sdvignd) 

Institut du Monde Arabe Delacroix 
in Morocco: Delacroix’s visit in 
1832, when he was 34, made a 
lasting impression on his art Ends 
Jan 15. Closed Mon (1 rue des 
Fosses Saint-Bemard) 

Petit Palais From Baghdad to 
isphahan: 70 Islamic manuscripts 
evoking the ancient civilisation of 
central Asia, on loan from the 
Institute of Oriental Studies In St 
Petersburg. Grids Jan 8. Closed 
Mon 

ROTTERDAM 

Museum Boymans-van Beuningen 
From Van Eyck to Bruegel: 96 
Dutch and Flemish paintings dating 
from 1400-1550. Bids Jan 22. 
Alexej Jawlensky (1864-1941): 
retrospective of the Russian-bom 
artist who was a member of 
Kandinsky’s circle In Munich. Bids 
Nov 27. Closed Mon 
STOCKHOLM 
Nationahnuseum Goya: 50 
paintings and 60 prints, most of 
them on loan from Spain. Ends Jan 
8. Closed Mon 
TURIN 


GaHerie Civica cf Arte Modema A 
Celebration of Art Nouveau: a 
re-evocation of an exhibition held in 
Turin In 1902. Ends Jan 22. Closed 
Mon 
VENICE 

Palazzo Corner Masterworks from 
the Petit Palais in Geneva: 70 
Impressionist and 
Post-Impressionist paintings from 
the collection of the industrialist 
Oscar Ghez de Montenuovo, 
including works by Degas, Gauguin 
and Derain. Ends Dec 11. Daily 
VIENNA 

Kunstforum Herbert Boeckk 
centenary retrospective of the 
Austrian Expressionist Ends Dec 4. 
Dally 

KOnsttertiaus Egyptomania: 300 
exhibits showing the Influence of 
Egyptian art on European painters, 
sculptors, authors and a’chltects 
from the baroque period to the 
present Ends Jan 29. Daily 
WASHINGTON 
National Gallery of Art Roy 
Lichtenstein’s Prints: 90 works by 
the American Pop artist Ends Jan 
8. Milton Avery (1893-1965): 67 
works on paper. Ends Jan 22. From 
Minimal to Conceptual Art - Works 
from the Vogel Collection: 90 
drawings, photographs, paintings 
and sculpture by contemporary 
artists, including LeWrtt, Christo, 
Ryman, Beuys and Flavin. Ends 
Nov 27. Daily 
WOLFSBURG 

Kunstmuseisn Man Ray: more 
than 60 photographs by the 
American master of the enigmatic 
and the unusual, mostly dating from 
1919-1949. Bids Jan 15. 

Jean-Marc Bustamante (bl952): 
large steel scriptures by the French 
Artist Ends Nov 27. Closed Mon 




14 


■■■ 


FINANCIAL TIMES FRIDAY NOVEM$E)p|^,i 




Norma Cohen on the debate over the cost of capital in the UK 

[" j 1 OK, a well-oiled sp- A Pllt fClY so^ 

temheliwcompamra raise il LUl JLV-JJ- is US-style “global to 


I n the UK, a well-oiled sys- 
tem helps companies raise 
new equity capital by sell- 
ing shares to their exist- 
ing shareholders. 

There is growing concern, 
however, among regulators, 
companies and some invest- 
ment bankers that the system 
Is too expensive. Alternative 
ways of raising capital used in 
other countries are cheaper 
and just as good, they suggest 
“The cost of capital in this 
country is too high because of 
our arcane practices," says Mr 
Amir Rilnn, director of corpo- 
rate finance at Barclays de 
Zoete Wedd, the investment 
hank. 

The Office of Fair Trading is 
reviewing the system that 
requires companies raising 
new capital to pay fixed com- 
mission charges, regardless of 
the attractiveness of the shares 
or market conditions at the 
time they are sold. An unpub- 
lished study by Professor Paul 
Marsh of the London Business 
School for the OFT has con- 
cluded that institutional inves- 
tors which help launch new 
share offerings have earned 
what he describes as “excess 
returns” of about £2 40m 
between 1986 and 1993. 

The UK system works like 
this: a company that wants to 
raise capital by issuing shares 
finds an Investment banking 
adviser to structure the deal 
and underwrite it. that is 
promise to buy all the shares 
at the agreed price. To spread 
the risk, the investment bank 
finds institutions among exist- 
ing shareholders that agree to 
sub-unde rwrite the offering. 
They promise to buy a parcel 
of the new shares at the agreed 
price, even if there is a lower 
market price on the final day 
of the offer. 

Under the UK system of pre- 
emption rights, the new shares 
must be offered to existing 
shareholders, normally at a 
discount to the current market 
price of typically around 13 to 
15 per cent (although discounts 
vary). These lights give them 
the opportunity to buy new 
shares in equal proportion to 
their current stake so that they 
can maintain their proportion 
of the share capital. 

In addition to the discounted 
new shares - which typically 
earn the same dividends as the 
existing shares - sub-under- 
writers receive a standard fee 
of L25 per cent of the total 
raised. The broker receives a 
standard 025 per cent co mmit 
sion and the adviser a 0.50 per 
cent commission. The cost of 
issuing the new shares is 


everyone 



therefore 2 per cent of the capi- 
tal raised, plus - arguably - 
the discount on the shares sold 
to existing shareholders. 

“Underwriters and sub-un- 
derwriters perform a useful 
service for companies by 
assuming +Vn» risks of a flailed 
issue. Historically, however, at 
least for equity rights issues, 
the evidence indicates that the 
fees they charge for the 
assumption of tins risk signifi- 
cantly exceed the value of the 
insurance they provide,” the 
LBS report says. 

London’s traditional mer- 
chant banks, for which the 
rights issue system is an 
important part of their busi- 
ness, defend their comer, how- 
ever. Commissions are fixed, 
they argue, because it would 
be impractical to negotiate the 
fee with hundreds of institu- 
tions which must make snap 
judgments about whether to 
sub-nnderwrite at the offer 
price. 

And while the commission is 
the same for all issues, the 
more attractive shares can be 
offered at a smaliCT discount 


than less attractive issues. 

Finance directors privately 
argue that a system which 
forces them to issue new 
shares at a discount raises the 
cost of capital. More shares 
have to be issued to raise the 
same amount of capital and a 
dividend paid on each one. 

“That means the pay-back 
from the new capital will have 
to be significantly higher." 
according to the finance direc- 
tor at one FTSE-100 company. 
“It then defines the sorts of 
investment that a company 
nm make." 

But Mr Anthony Beevor, 
head of corporate finance at 
Hambros Bank, says the argu- 
ments about the discount are 
irrelevant because the true 
owners of a public company 
are its shareholders. “You are 
giving the shares more cheaply 
to yourself;” he says. 

But privately, even the insti- 
tutional shareholders which 
publicly defend pre-emption 
rights and which benefit most 
from fixed commissions ques- 
tion whether the system is in 
companies’ best interests. 


An alternative advocated by 
some of the larger investment 
banks is US-sty!e "global book- 
building". With book-building, 
the shares are heavily mar- 
keted by the investment bank 
handling the issue. The price 
of the new shares is set at a 
level that reflects market 
demand, rather than at an 
automatic discount to the mar- 
ket price as in most UK rights 
offerings. 

However, book-building is 
difficult to reconcile with UK 
shareholders' pre-emption 
rights, which require that the 
new shares are marketed only 
to existing investors. There 
may be ways round pre-emp- 
tion rights, but they can be 
applied only in limited circum- 
stances. 

And regulators fear that 
book-building is less attractive 
for secondary offerings, where 
a stakeholder sells a large 
block of shares and pre-emp- 
tion rights do not apply, 
because of the absence of Stock 
Exchange rules on short-sell- 
ing. In the nm-up to a book- 
building exercise, shareholders 
can sell shares they do not own 
and drive down the price of a 
company's shares, to reduce 
the cost of the new shares. 

In October, the London Stock 
Exchange launched a review of 
rules on short-selling, asking 
whether there ought to be 
greater disclosure of short posi- 
tions. Both the Stock Exchange 
review and the OFT enquiry 
are understood to have the 
blessing of the UK Treasury 
which is concerned partly 
because it fears London may 
lose its edge as the centre for 
international share trading 
because of higher costs. 

However. London's tradition- 
alists say that the current sys- 
tem makes capital raising in 
the UK cheaper than elsewhere 
because fees are lower. 

If fees are the only cost of 
capital, the data suggests there 
is merit in this argument. 
According to Securities Data 
Corporation, a New Jersey- 
based research firm, the aver- 
age fee in 1993 for an under- 
written offering of SlOOm or 1 
more in the US was 5.048 per 
cent. Fees ranged from 2.25 
percent to 7 per cent. 

Mr Beevor argues that by- 
comparison, the 2.0 per cent 
fixed fee in the UK is cheap. 
Even critics of the current sys- 
tem agree that for all its short- 
comings, it has been effective 
in guaranteeing UK corpora- 
tions access to equity capital 
through good times and bad, 
and that alone may be good 
reason not to tinker with it 


FT 


THE POLISH HIGHWAY 


FINANCIAL TIMES PROGRAMME 

Conferences 


Opportunities for Private Finance & Investment 

Warsaw, 12 & 13 December 

Timed to coincide with the first official announcement on the terms and conditions for 

tendering for the forthcoming $8bn Toll-Highway programme, this high level forum will 

provide up to the minute information and expert guidance on the key challenges involved in 

mounting major projects in Poland. 


ISSUES INCLUDE: 


• Tendering process's terms of reference 


• Securing funding for projects in Poland and meeting bank requirements 

• Feasibility of Build-Operate-Transfer (BOT) , 

projects in Poland 

• Bidders’ perspectives on the Polish highway programme 

SPEAKERS INCLUDE: 


• Dr Bogus law Liberadzki 

• Mr A Kent Riffey 

Minister of Transport and Maritime Economy 

Vice President and Manager 

Poland 

Bechtel Civil Company 

• Mr Andrzej Patalas 

• Mr Henry Liszka 

Director 

Director, Poland 

Agency for Motorway Construction 

Boris Polska Sp xqjo 

• Dr Manfred Knoll 

• Mr Dariusz Slotwinski 

Senior Vice President 

Director 

Deutsche Bank AG 

Dromex 

• Mr Maciej Olex-Szczytowsld 

• Dr Olivier Bonnin 

Managing Director 

Director of Development 

Schroders Polska 

Department of Public Works 


Bouygues Poland 

In association with the Institute of Civil Engineers Official Carrier: |0^ J 


T he UK government is 
now deep into its 
deliberations on the 
future of the state- 
owned nuclear power industry. 
One of the key issues is 
whether private money can 
finance further development of 
the industry, through privati- 
sation or funding new projects. 
Without it, the nuclear power 
industry has a highly uncer- 
tain future in the UK: it is 
most unlikely that any further 
nuclear power stations would 
be paid for by any government. 
Tory or Labour. 

But is the City ready to put 
up the money instead? 

This was not the case when 
the electricity industry was 
privatised in 1989. The inten- 
tion then was to sell off the 
nuclear component as well, but 
the plan was withdrawn 
because investors were 
unhappy with the risks and 
high cast of decommissioning 
old nuclear power stations. 

The City has since become 
more sanguine about nuclear 
energy. Several City institu- 
tions are looking for ways of 
involving the private sector. 
BZW. the investment bank, 
and KPMG. the accountancy 
firm, are advising the Depart- 
ment of Trade and Industry on 
the prospects Tor privatising 
the two generators, Nuclear 
Electric and Scottish Nuclear, 
which, by some estimates, 
could raise more than £2bn. 

Nuclear Electric has hired 
Morgan Stanley, the US invest- 
ment house, to explore inves- 
tor attitudes to nuclear energy. 
It has also asked NJJ. Roths- 
child if private money could be 
raised to finance construction 
of a new nuclear power station. 

Morgan Stanley's report, the 
only one so far issued, was 
bullish about the prospects. 
Based on other countries' expe- 
riences with private sector 
nuclear utilities, such as the 
US, Germany, and Japan, Mor- 
gan Stanley concluded inves- 
tors were sophisticated enough 
to understand the risks - the 
implication being that Nuclear 
Electric could be privatised. 

The Rothschilds report is not 
yet complete. But Mr Mike Kir- 
wan. Nuclear Electric's finance 
director, says it is edging 
towards positive - if qualified 
- conclusions. It will say that 
private sector money could be 
found for nuclear power sta- 
tion construction provided a 
well-tried design was used and 
Nuclear Electric was closely 
involved in the building and 
operation of any new station. 
Such a project could be put 
together using rates of return 
close to those of the new gas- 
fired power plants currently 
being fmanrad - and below the 


FT Conferences have a number of excellent opportunities for companies to bring their company's products 
or services to the attention of our international audiences. For further information, please contact Lynette 
Northey on (+44) 171 814 9770. 




1#* 


sive services of 

Fuels. - the state mtaotoy 1 
wheal cheaper await 

able, such as 

They are also risrebf&krajn 
Nirex, the state^ageticy/ Wfadi 
handles long-term tsioaclhfr 

waste dlspcsaLj Analysis say' 

these ties would -iaveAo ^be* 
loosened if (toe tMLjcampaafes 

were to be tmty coEaraodaL 
: The point about cbjmoaiefefi 
freedonris of parttetoqr «at 
cent, because, ferjagtdfsts 
believe more poWeT-ftstiMa 
will be btdli. doe . to -public 1 
opposition. The tworcompamea 
must therefore be abte- ' to 
branch out ff ther arp tojgrow 
and pay rising dividends. - ■>. 


IWGMi 

Turbines at Sizewell B: private funding for such sites is possible 


Particle 
of hope 


David LasceUes on a shift in the 
City’s attitude to nuclear energy 


11 per cent assumed by 
Nuclear Electric up to now. 

But these institutions are all 
working for the industry. What 
of independent bankers and 
financiers? Here, views are 
more mixed. Several analysts 
say the City has paid little 
attention to the nuclear 
review. “Investors only start 
thinking about a project when 
someone sticks a prospectus 
under their noses," says (me. 
“We are a long way from that" 

But the City is now clearly 
less concerned about the risk 
of catastrophe or environmen- 
tal rnm taTmnflti nn 

The perception of Nuclear 
Electric and Scottish Nuclear 
has also shifted: they are now 
seen as commercial concerns 
with capable and communica- 
tive managements. The fact 
that they have made deter- 
mined efforts to cot costs and 
become profitable has been 
noted, and their annual 
accounts have begun to 


acquire greater credibility with 
financial analysts. In {articu- 
lar, the companies' estimates 
of decommissioning costs are 
considered to be more realistic 
than in 3989. 

But the more commercial 
nuclear energy becomes, the 
more the (2ty is inclined to ask 
hard-nosed questions about the 
nuclear generation business. 

A large risk overhanging the 
industry is seen to be govern- 
ment interference. Nuclear 
companies would need govern- 
ment promises of fdD commer- 
cial freedom for privatisation 
to succeed. But this would be 
no guarantee against future 
government intervention 
which might try to restrict 
nuclear activities, or require 
heavier ripcYmmimrinning pro- 
visions, so affecting profits. 

This freedom would have to 
extend to managing one of the 
industry's major costs: waste. 
At the moment, the two com- 
panies have to use the expen- 


F or privatisation' No 
work, the gsvendotait 

would have to create* 
package raitiketise u, 
the City. This meanS the’firti. * 
est and cosffiest parfit- ^ fl* 
first generation Magnor reab, 
tors - remaining in state* ownN 
ership. Bat berth co mpanfag 
-would also, have to set up a- 
segregated fund • for their - 
decommisslQning jfroviaoasto 
persuade inv es to r s they were 
safe for the long termfCar- 

rently, these appear an. the 

general balance sheet witeri 
they can easily be diverted: 

The City's mixed, views 'on 
privatisation are an improve- 
ment from the wholly negative ‘ 
ones held in 1989. Mr Kirsan gL 
Nuclear Electric says hfe is 
encouraged by conversatiatas' 
with financiers. “I 'think hwss-; ■ 
tors realise d eft n iTi m tesI rmfa jr jg 
only constxuction in reverse, 
albeit with a longer time - 
frame,” he says, "it is uonnal 
tor investors to accept lt and • 
pay for it" ■--■■■■ - 
Some analysts agree that jgi- • 
vatisation could be on ti& 
cards. "It's do-able, but its 
really a matter of poHtical - 
win," says Ml* John Reynolds, 
electricity analyst atJatnes 
fiapwi; who thinks that' the sale 
could be done in 1996. ' 

But few ' analysts Vwipect 
action, under thiagovemmmt, 
Aitfwni gh there would be gains 
for the Treasury from an early 
sale, and the electridtymariffit 
would benefit from greater 
competition, the implications 
of nuclear privatisation may he 
too momentous for a precari- 
ous government in the runup. . 
to an election by nud-lSG?.. : 


From thisweek, 

Joe Rogaly's Friday ' 
column is moving to 
Saturday’s Weekend PT* 
He will continue to 
write on this page 
on Tuesdays 


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From Mr Neil Spooner. 

Str, In his Fanner’s View- 
point (“Exaggerated threat 
seen in eastern promise", 
November 8), David Richard- 
son argued that British farm- 
era need not be too concerned 
about the huge potential of 
agriculture in eastern Europe 
and tbe former Soviet Union. 
He says British farmers lack 
the skills necessary to start 
operating in these countries, 
and tbe threat of competition 
back home is still a long way 
off due to cultural, capital, 
political and climatic prob- 
lems. He is wrong on both 
counts. 

Countries like Ukraine have 
a clear potential to compete in 
world markets for leading 
crops like cereals and oilseeds. 
Yields of the most progressive 
farmers are already well above 1 
the UK average and farmers 
are exporting profitably, not 
only to the huge regional mar- 
ket but to Europe and North 
America as well 

The answer is not to bury 
heads in the sand waiting for a 
“serious threat 10 years from 
now". The countries of the for- 
mer Soviet Union and eastern 
Europe should be regarded as a 
new opportunity for western 
Europe’s beleaguered farmers. 
East/West cooperation in farm 
production offers significant 
benefits to both sides. For east- 
ern farmers co-operation 
brings access to investment 
capital, farm business and mar- 
keting skills, knowledge about 
new technologies and customer 
contacts. To western farmers it 
opens up a whole new set of 
potentially profitable invest- 
ment opportunities and access 
to new markets. 

We should stop talking about 
ensuring that the ElTs pro- 
tected markets re main dosed 
to unfair competition and 
become more proactive in 
encouraging western farmers 
to take some practical steps to 
invest in the east 
Nell Spooner, 

director, food and agriculture 
programme. 

International Committee for 
Economic 

Reform and Co-operation, 

An der Elizabethkirche 25. 

53113 Bonn, Germany 


From Mr Andrew Van Busten. 

Sir. As a proponent of free 
trade between the North Amer- 
ican Free Trade Area and the 
EU - if anything, to counter 
the Japanese challenge more 
effectively - I am disheartened 
by opposition, especially in the 
UK, to proposals by Germany 
and France to launch the Ecu 
in phases, the so-called multi- 
speed approach. 

The EU will probably have 
some 16 to 20 members by the 
end of this decade - the target 
date for monetary union - mud 
it is unrealistic to expect con- 
sensus by all involved, given 
wide disparities in social and 
economic development. Put 
another way, it is highly doubt- i 
fill that all members will have 
met the stringent fiscal and 
budgetary discipline required 
by Maastricht 

Decision-making in such an 


unwieldy assortment of 
nations needs to be revised 
anyway, to make it a function- 
ing and effective union. So the 
idea of getting the Ecu off the 
ground by those countries 
which are fuQy committed to it 
and could qualify now under 
Maastricht strikes me as neces- 
sary, and the only way to move 
Europe towards a single cur- 
rency. It is critical if the EU is 
to remain internationally com- 
petitive (not to speak of its psy- 
chological impact). 

That Europe needs to rid 
Itself of (now) 12 currencies in 
the space of 2J35m sq km (the 
size of Zaire or Sudan or 
Algeria) is self-evident. Such a 
number of currencies promotes 
inefficiencies for business and 
individuals alike. It is hope- 
lessly ponderous and, in these 
days of fast trains crossing 
countries in mere hours, it 


Oxbridge problem is its 
products’ 'special’ status 


Information# 
from NRA 


From Mr Walter Ellis, 

Sir, In his article, “Oxbridge 
arrogance" (Truth of the Mat- 
ter, October 15), Nigel Spivey, 
editor of the Cambridge 
Review, joins his many col- 
leagues in the Oxbridge estab- 
lishment in dismissing me as a 
bigoted “knocker” of our 
ancient universities. 

Referring to my book. The 
Oxbridge Conspiracy, he writes 
that “to perpetuate the mythol- 
ogy of some cabalistic, public- 
school. backward-looking 
Oxbridge is pure prejudice, and 
it is a prejudice to which Wal- 
ter Ellis . . . must confess". 

In feet, my hook makes clear 
(to those who bother to read it) 
that what is wrong with 
Oxbridge is not its residual - 
bias towards the public 
schools, but the fact that its 
products, both state and pri- 
vate, are treated by English 
society as a special caste, 
whose entry to the corridors of 


power, privilege and wealth is 
assured, overwhe lming ly, fiy 
virtue not of academic perfor- 
mance, but attendance. 

Other universities have 
bright people, too, but they 
must fight to be noticed. 

Spivey’s reference to “beefy" 
Magdalene College rugby play- 
ers lining up to urinate in front 
of their retiring Master 
scarcely refutes this conten- 
tion, even if several of the mas- 
terly micturators did come 
from a Swansea comprehen- 
sive. Nor, surely, is it helpful 
to his case to point out how 
“gratifying” it is that so many 
of the nation's top jobs are 
held by Oxbridge graduates. 
Britain, he says, needs more 
arrogance, not less. Well, if so, 
we know who to look to for a 
lead. ; 

Walter S Ellis, 

134c Coleraine Road, 

Blackheath, 

London SE3 7NU. 


IMF and loans to Zambia 


The letter published on 
November 4 from Mr G G John- 
son. assistant director, African 
department. International 
Monetary Fuad, omitted a pas- 
sage in his reference to conces- 
sional loans and grants from 
bilateral and multilateral 
sources to Zambia. It should 


have read that they “have 
averaged more than f700m a 
year during the three years of 
the programme, while cash 
debt service, including pay- 
ments to the IMF. has aver- 
aged less than S3 00m - an 
overall net inflow of more than 
$400m a year". 


From Mr Ed Gallagher . 

Sir, The NRA has been 
accused by the Campaign for 
Freedom of Information 
(“River information paid for by 
the piggy bank", November 9) 
of overcharging tbe pub 5c as a 
means of inhibiting the release 
of information which they are 
entitled to have. This is not so. 

The NRA is an open organi- 
sation. Every regional office 

holds a register of information 
which the public is entitled to 
inspect free erf charge. The typ- 
ical charge for photocopies 
from the registers Is £1, which 
includes up to 10 copies. 

Only where complex investi- 
gations are required, or where 
information is requested for 
commercial purposes will a 
higher charge be levied. The 
NRA makes no profit from 
these charges which are .based 
on actual costs incurred. 

We do not charge school chil- 
dren. There is a comprehensive 
education pad; available free 
to every primary school in 
England and Wales and marryjt 
of their requests can be satis- 
fied from our 600 reports and 
leaflets, many of which are free 
of charge, and which we sup- 
ply willingly. 

Ed G allag her, 
chief executive. 

National Rivers Authority, 

30-34 Albert Emban k ment, 

London SE17TL 


W cl 


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does not make sense any more. 
The yen and dollar now . rule 
the world. A union with 450m 
people, soon to exceed half -a 
billion, can no longer be . left 
behind. . - 

Tbe “timer erne” initiative, 
probably encompassing 
France, Germany and. the. 
Benelux, should be applauded 
by the rest of the EU members. 
They are taking the risks. 
While the Ecu will not replace 
national currencies at' ibis 
stage, and would amount to 
alternative tender, the whole 
initiative could fail- But it is a 
beginning that needs to be 
tried, lest the Maastricht ideals 
fall apart 

Andrew Van Husteri, 

Van Busten International Go, 
1847 Acacia Bill Drive, . . 
Diamond Bar, 

Catifbrma 91765, 

OS •. 


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a necessity 




FINAiVCIAJL TIMES FRIDAY NOVEMBER 1 1 1994 


FINANCIAL TIMES 

Number One Southwark Bridge, London SE1 9HL 
TeL- 071-873 3000 Telex: 922186 Fax: 071-407 5700 

Friday November 11 1994 


Ratifying 
the round 


An electoraHy battered President Everything i 
HD Clinton la about to fly to Jak- round would 
arta for the second annual summit The oredib: 
of the Asia-Pacific Economic muchatstaki 
Co-operation forum. Foreign pol- lateral trad 
icy success matters to the presi- unlikely, for 
dent, but in this case what he tries would 1 
achieves abroad will be deter- into complex 
mined by events at home. The US Apec-wide fn 
will create nothing concrete the US was 
within Apec if the Uruguay Round Uruguay Ron 
outcome is not ratified. tton would 1 

That task falls to the lame-duck waste of tun 
Congress. Some argue that a duck fury, signifyb 
as lame as this one has become 
has no right to pass legislation of 
such significance. It would inrfpf >d LC 2 p fonv 
have been better to have ratified The puzzli 
the legislation sooner. But there Is doubts surfac 
no alternative. If the bill were to the Uruguay 
die in the present Congress, it important res 
could not be reintroduced into the the US that 
next one under tha "fast track” agriculture, f 
authority. Amendments would property and 
then be possible and, being possi- wont, measure 
ble, would be probable. If the that wanted < 
round were passed in a different pute settleme 
form from what was negotiated, it the outcome ; 
would have to be reopened. The short of inith 
chances that others would agree also a huge 
to that idea, after seven years of World Trade 
wearisome negotiations, can be fact, a remarl 
defined simply as zero. global co-opei 

This notion of a later consider- Yet at this 
atkm is frivolous. The US has a umph, peopl 
simple choice: to ratify or not - rediscovered 
and the time to ttoritfa is now. The about soverei] 
US is, .it appears, also the only Inter national 
country in the world to have bade in the Ii 
Important substantive doubts however. Is 
about the deal. So a heavy weight national sovei 
now falls on the shoulders of this in the case ol 
particular lame duck. g overnments ; 

The benefits of the round are There is no 
not the smallest part of what is at kind of intern 
stake. A report from the Gatt sec- conditions for 
relariat, out today, presents the be both predfc 
results in greater detail than hith- This Is win 
erto. In addition, it uses a sophists the 1930s. It ii 
cated economic model to evaluate the Redproca 
the benefits to total world income; Act started t 
which it assesses at an increase of Journey that 
$S10bn in 2005, including a gain of Uruguay Ron 
$122bn for the US. Huge as it is, process under 
this excludes the effects of the 'success of. the 
round on services, intellectual which is why 
prop erty and, more generally, on and Russia w? 
security of market access. the post-cold 

have also take 

_ . .. . international 

Over- optimistic Failure by th 

Such calculations also zest on round would, t 
the over-optimistic assumption one moment tc 
that the alternative to ratification two great mis 
would be the status quo ante. Yet war period - t 
the decision to initiate the Urn- League of Natl 
guay Round was a response not Smoot-Hawley 
Just to protectionist pressures, but To make tt 
also to the belief that the interna- was calamity 
tianal trading system had become them would be 
too incomplete to remain relevant, often difficult 
The final deal is the product of the whether an ei 
seven years of the round, them- this is certain] 
selves following around four years Round dedsl 
of preparation. If, after 11 years of moment in thi 
effort, the outcome fails to be rati- tfons with tin 
fied by the country that drove the The achievem 
process throughout, the system bipartisan. Th 
will stand condemned as irrele- to both parti 
vant to the -problems of today, must remembt 

Learning the 
right lessons 


Everything achieved before the 
round would then start to unravel. 

The credibility of the US is as 
much at stake as that of the multi- 
lateral trading system. It Is 
unlikely, for example, that coun- 
tries would be prepared to enter 
into complex negotiations on an 
Apec-wide bee trade agreement if 
the US was unable to ratify the 
Uruguay Round. Such a negotia- 
tion would be condemned as a 
waste of tune: full of sound and 
finy, signifying nothing. 

Leap forward 

The puzzling thing about the 
doubts surfacing in the US is that 
the Uruguay Round is, in every 
important respect, its baby. It was 
the US that wanted inclusion of 
agriculture, services, Intellectual 
property and trade-related invest- ! 
ment measures. It was also the US i 
that wanted a more effective dis~ 
pute settlement procedure. While 
the outcome has inevitably fallen 
short of initial US demands, it is 
also a huge leap forward. The 
World Trade Organisation is, in 
fact, a r emar kable achievement of 
global cooperation. 

Yet at this very moment of tri- 
umph, people in the US have 
rediscovered the old concerns 
about sovereignty that buried the 
International Trade Organisation 
back in the late 1940s. The truth, 
however, is that unbridled 
national sovereignty Is impossible 
in the case of trade, because two 
g overnments are always involved. 
There is no alternative to some 
kind of international a gwefttnimf. if 
conditions for global trade are to 
be both predictable and liberal. 

This Is what the US learnt in 
the 1930s. It is now 60 years since 
the Reciprocal Trade Agreements 
Act started the country on the 
journey that culminated in the 
Uruguay Round agreement The 
process underpinned the postwar 
success of. the market economies, 
which is why countries like China 
and Russia want to join. Now, in 
the post-cold war era, economics 
have also taken.a central place in 
international political relations. 
Failure by the US to ratify the 
round would, therefore, amount in 
one moment to a repetition of the 
taro great mistakes of the inter- 
war period - the vote against the 
League of Nations in 1919 and the 
Smoot-Hawley tariff of 1930. 

To make those mistakes once 
was calamity enough- TO repeat 
them would be unforgbreable. It is 
often difficult to know in advance 
whether an event is historic. But 
this is certainly one. The Uruguay 
Round decision is a defining 
moment in the history of US rela- 
tions with the rest of the world. 
The achievement of the deal was 
bipartisan. The challenge now is 
to both parties. All concerned 
must remember what is at stake. 


At last, after six years of attempts, 
the UK government has passed 
one of 'the most difficult tests of 
domestic pottcy. devising a work- 
able .national curriculum for 
schools. The final .text published 
yesterday hardly deserves an “A” 
grade. But although the teaching 
mritmc have given only a grudging 
espouse, the proposals look like 
lelivering ' peace in Britain’s 
schools after years of turbulence. 

A year ago that looked unlikely. 
The. curriculum proposals,- which 
stemmed originally from unease 
about falling standards of literacy 
unit numeracy, had become so 
detailed and extensive that they 
threatened to engulf every minute 
of the day. Meanwhile, 

the {tagire .to raise national stan- 
dards in core subjects had become 
an obsession with testing almost 
everything: 

The problem has.beea that the 
government envisaged the currier 

ntrrm and tha SSSOCfoted system of 

tests as perfarming tfaree entirely 
separate functions: setting a stan- 
dard of educa tion to which schools 

riumiri aim; providing a Nation- 
wide picture of how-students are 
doing; and .giving , parents and 
teacher s benc hmark s 1 for the prog- 
ress of individual pupils. In frying 
to satisfy those ambitions, the 
original curriculum risked per; 
forming no task well 

Slimmed down - 

The final . version of the curricu- 
lum, the product of an lAmonth 
review by Sir Rem Bearing, chair- 
man of the Schools Curriculum 
mid Assessment Authority, untan- 


MkUwU' V®»’ I HllMv"" " ■■ ■ i 

to thetoato principles laid out in a 
preliminary revision to May: 
many, areas have been s li mm ed, 
down, the core subjects 
En gHsh mathematics and science ' 
have been strengthened, as jam 
information technology courses. 

- There are still unwelcome signs 


he taught even, to pdpfis under 


seven years old, and, in line with 
the pledge the prime minister 
made to his party conference, 
schools must encourage competi- 
tive team sports. There are also 
signs of confusion about the aims 
Of Science te aching ; the amphawis 
on natural sciences has increased, 
but there is much fiddling with 
the detailed content of lessons. 
Such ; points aside, schools' anxi- 
eties, about the rigidity and work- 
load of the original proposals have 
been broadly answered. 

. National standards 

- So too have many concerns 
about testing, in a series of radical 
revisions to the original proposals. 
In recommending testing by exter- 
nal examiners at ages U and 14, 
rather, than by schools them- 
selves, the curriculum has become 
mare clearly a tool for assessing 
national standards and comparing 
scho o ls- At the same time, it has 
rightly relinquished the impossi- 
ble goal of providmg standards by 

which to monitor every child. 

The changes appear to have pac- 
ified most of the teaching unions, 
who should now withdraw grace- 
fully from boycotting tests. They 
should recognise that, having 
gained so many concessions, they 
could lose ratedi sympathy by per - 
sisting. The rations can. however, 
credit themselves with engineer- 
tog, almost inadvertently, an 
important improvement in educa- 
tion policy which would otherwise 
not have taken, place. 

The pity of the saga is that a 
workable curriculum has been 
devised almost by chance, out of a 
dispute that began on the narrow 
territory of teachers’ workload. 
Mwhanriling ctf that squabble by 
both rides widened the debate; it 
is a hap py accident that such a 
bitter row has produced a work- 
able policy. The government has 
now «rmp up with more or lass 
the right, answer. But it earns few 
marks' for the painful and pro- 
longed route it task to get there. 


m * g r On both sides of 
' Europe, busmess- 
men * bankers, politi- 
clans and econo- 
Hm mists have been 
Tf» faff of the frantically at work 
W All since the demolition 

of the Berlin Wall in 

jt$& The degree of waste and ineffi- 
ciency in planned economies has 
proved greater than anticipated. 
But the biggest surprise - both for 
east Europeans and for westerners, 
who had taken it for granted - has 
been the subtlety and sophistication 
of the market economy. 

Mr Dennis Skinner, Midland 
Bank's representative in Moscow 10 
years ago, at that time described 
the Soviet-style economy as "a giant 
cartwheel" with a powerful rim, 
hub and spokes. “But in between 
the spokes, in the space which mar- 
ket economies fill with a rich, inter- 
connecting tissue of financial ser- 
vices, advertising and marketing, 
pension funds and the like, was a 
void," he explained. 

In essence the past five years 
have been spent cutting back the 
bloated bureaucracies militar- 
ised, monopoly producers, fostering 
private enterprise and Oiling up the 
space between the spokes. 

Thousands of would-be entrepre- 
neurs, bankers and stockbrokers 
from the east have set out on a 
quest to discover the secret of abun- 
dance, and the mechanisms by 
which wealth is created And an 
army of western economists, consul- 
tants, accountants and lawyers has 
sprung into action to satisfy this 
demand. 

A new institution, the European 
Bank for Reconstruction and Devel- 
opment, was set up to facilitate the 
transition, while the European 
Union and individual governments 
set up special funds, such as the 
UK's Know-How Fund, to channel 
aid and transfer skills. 

Fundamental principles were 
rediscovered. The most important 
was the crucial role of private own- 
ership and the linkage between 
legality, democracy and prosperity. 
The communist state began by seiz- 
ing private property. The restitu- 
tion of private property and privati- 
sation of state-owned assets have 
been at the heart of the transition 
to a law-based, multi-party market 
economy and society. 

By early next year, with the com- 
pletion of the second round of mass 
privatisation, the Czech govern- 
ment forecasts that 80 per cent of 
the economy win be in private own- 
ership. The private sector in most 
other central European states now 
constitutes between 4fr65 per cent 
of the economy. Even Russia, where 
macro-economic stabilisation poli- 
cies are stffi being formulated, has 
managed to privatise about 50 per 
cent of the economy. 

Privatisation has never before 


The economic transition of the former communist 
countries is starting to pay off, says Anthony Robinson 

Painful rebirth 
from the ashes 


taken place on such a scale and at 
such frantic speed. And while the 
privatisation itself has not created 
enterprise capital or managerial 
expertise, it has generated the need 
fpr efficient banks, stock markets 
and investment ftinds and sparked 
off a hunt for foreign equity invest- 
ment and managerial skills. The 
distance from the old command 
economy is already enormous. 

However, the pain has been 
greater than originally imagined. 
Although, the death agonies of the 
old system have been exaggerated 
by a statistical reporting system 
based mainly on output from state 
enterprises, the first two to three 
years of reform did see a 20 to 40 
per cent fall in industrial output. 

Production of armaments, shoddy 
consumer goods and obsolete indus- 
trial equipment fell. Millions of 
workers in what had been secure 
jobs were sacked, placing a large 
burden of social payments on state 
budgets at the same time as reve- 
nues from taxes on state enterprise 
profits were collapsing. Entire 
industries and company towns have 
closed or have stockpiled unwanted 
goods, failed to pay wages and run 
up impossible debts. 

This industrial decline has been 
accelerated by the collapse of the 
Comecon trade and transferable 
rouble payments system in late 
1990, and exacerbated by recession 
and protectionism In the west Most 
central European countries now do 
more than 50 per cent of their trade 
with the EU, which, through a 
series of bilateral and “asymmetric” 
association agreements, offers free 
trade in many industrial products 
but retains restrictions on “ sensi- 
tive" products such as iron, steel, 
textiles and foodstuffs backed by 
anti-dumping and other blocking 
measures. 

In the confusion of the transition 
to a market economy, many of the 
state’s best assets have been hived 
off by communist era factory man- 
agers. This has left the loss-making 
cores of thousands of enterprises 
feeing bankruptcy. In Ukraine, Rus- 
sia and those former Soviet repub- 
lics where output was concentrated 
in military or related sectors, seme 
problems remain. 

But the important point is that 



Economies of former comvmmist countries 


Growth nUaU 
In ruf eonaume 
OOP prices 

mar i wat 

CM Ptchtf 


Print* Aflri- Total 

Meter cdtura fore* 

share of shore (firoc 

GDP mtt- fn GDP§ vnm 

04*“ (%} 1BO0 (%) WMB i 


without capital, has been largely 
answered: it has been accumulated 
from the savings made by reducing 
waste and through the privatisation 
of poorly used forma’ state assets. 

But in the former Soviet Union, in 
particular, billions of dollars of cap- 
ital have been created through the 
often clandestine expropriation and 
export of raw materials, energy and 
other resources. Many "robber bar- 
ons” have set up foreign bank 
accounts, awaiting the legal reforms 
In Russia that will allow them to 
repatriate their suitably laundered 
funds. This capital, like that 
amassed by the US and European 
equivalents in the 19th century, is 
needed to capitalise the new private 
tanks and to finance the plants and 
infrastructure required to begin the 
industrial transformation of Russia. 

Foreign investment to date has 
been modest, relative to other 
emerging economies in Asia or 
Latin America. The EBRD calcu- 
lates that total foreign direct invest- 
ment in 1990-93 in the entire former 
Soviet controlled area, with 450m 
inhabitants, totalled $12. 43m. Sing- 
apore alone, with only 3m people, 
received $5.6bn just in 1992. 


E as te rn btoo 
Albania 


B ut the slow start was 
Inevitable, given the 
absence of property title 
and the lack of legal and 
administrative frame- 
works required to attract and 
absorb foreign capital Foreign 
Investment is now rising, as compa- 
nies discover the region’s potential 
and east European governments 
introduce institutional changes and 
open up strategic sectors, such as 
telecommunications. 

Successful foreign debt reduction 
and rescheduling agreements by 
Poland and Bulgaria have also 
played a part Poland, which claims 
to have received $4j>bn in foreign 
investment to date, expects a simi- 
lar amount in the next year or so. 

Governments throughout the 
region have become more sophisti- 
cated and more aware of the global 
competition for foreign investment 
They have learnt that foreign 
investment brings more than capi- 
tal: it also provides technology, 
managerial skills and access to 
world markets. 

The big US multinationals and 
their European equivalents, such as 
Asea Brown Boveri, Unilever and 
Nestle, have been among the first to 
see the potential of the east But 
close observers, such as Professor 
JeEfrey Sachs of Harvard Univer- 
sity, argue that EU nations must 
declare war on their protectionist 
lobbies, abolish trade barriers and 
speed up investment if eastern 
Europe is to achieve “Asian tiger” 
rates of growth. 

An earlier article in this series 
appeared on November 9 


Croatia -3 1,150 

Czech Rep 0 18 

Macedonia -15 244 

Hungary -2 21 

Poland 4 38 

Romania 1 298 

Slovakia -4 25 

Slovenia 1 23 

Former Soviet Union 
Armenia -16 10,900 

AzMbaQan -13 810 

Belarus -12 2,775 

Estonia -8 38 

Georgia -40 2£S0 

Kazakhstan -13 1,906 

Kyrgyzstan -16 1*366 

Latvia -12 35 

Lithuania -16 188 

Moldova .-14 837 

Russia -12 842 


Tapdatan 

Turkmentet 

Ukraine 

Uzbekistan 


-28 7,344 

-8 ' 4,600 

-14 • 10,155 


SOUVK BBOD. rNMP tn <feoi*» end Taft** UK GSR kt FYR Macedonia- t&tiixn#*. -ftuitflering 
power perity-baumt. “‘Rough &UU> Mdmete. BMMP A Slovakia. Bern ua Georgia Russia. 
TMmnban and lAraM* tCnch Repuhtoand SfovaMa oombawd 


the unreformable Soviet system had 
to be destroyed If resources were to 
be freed for productive purposes 
and export, instead of being turned 
into arms or pollution. 

Millions of jobs have been created 
in trade, services and private enter- 
prises. A wide range of consumer 
goods, previously unavailable or 
restricted to an elite, is now on sale 
in privatised shops and kiosks. 
Some people have grown very rich; 
the weak, sick and unemployed 


have become poorer. But overall the 
dynamism of the private sector is 
impressive and remains under-re- 
corded. 

Countries such as Poland and the 
Czech Republic, which established 
macro-economic stabilisation and 
internally convertible currencies at 
an early stage, are now leading an 
economic upswing throughout cen- 
tral Europe. 

The great question of five years 
ago, of how to create capitalism 


Sweden must vote Yes for influence 


B On Sunday, Sweden 
votes on whether to 
join the European 
Union. If the major- 
ity is against, it will 
remain a member of 

PFRVONA t ^ Eur ° Pean Ec °- 

T^nomic A**- the 

— free-trade zone that 

links the EU with members of the 
European Free Trade Association 
CEfta). 

The vote is too close to call. But 
there is a danger that an indecisive 
and insecure electorate is poised to 
vote No by a close margin, fearing a 
Yes vote will change Sweden for the 
worse and unaware that it will help 
change Europe for the better. 

If Swedes appreciate influence on 
matters that affect them, they win 
vote Yes. The ERA provides the 
Efta countries with little influence. 
The common administrative and 
decision-making institutions pro- 
posed when the EEA was first nego- 
tiated have never materialised. EEA 
rules are in reality determined by 
the ElTs decision-making proce- 
dures. 

The Efta countries face a constant 
stream of legislation from Brussels, 
which they are obliged to take on 


Safety in 
numbers 

■ Not bad going: two new central 
bank governors in one day. The 
armmrnrpmpn l of YaSUO Matsushita 
at the Bank of Japan and Bodil 
Nyboe Andersen at the Danish 
central bank adds to the impression 
that the Mrehang a rate in central 
bank governors is becoming 
increasingly volatile. 

They used to be such a stable 
bunch. Erik Hoffmeyer, who has 
hegn r unning the Danish centr al 
bank for 30 years, is a local hero in 
Denmark and a permanent fixture 
on the international monetary 
circuit And he was not the longest 
serving central banker. Iceland's 
Johannes Nordal who retired a year 
or so ago had run his central bank 
even longer. 

Leaving aside Luxembourg’s 
Pierre Jaans, Wim Duisenberg of 
the Netherlands now becomes the 
grand old man of European central 
banking and he has only been doing 
his job since 1981, according to the 
Morgan Stanley Central Banking 
Directory. Nine of the European 
Union’s central bank governorships 
have chang ed hands over the last 
ample of years - which must be 
some sort of record. 

Then there are all the new faces 
popping to eastern Europe. How 
else will Moscow’s Tatyana 
recognise Tokyo’s Yasuo if they 
don't start wearing big lapel badges 
at international gatherings? Pretty 


board without much say in its 
development if the EEA is to 
remain homogeneous. In the words 
of the Swedish prime minister. 
Ingvar Carlsson, the formal sover- 
eignty of Sweden in the EEA is the 
sovereignty of the powerless. 

Becoming a full EU member 
would Increase Sweden's influence 
over RU Legislation. And even 
though a small country prepared to 
pool sovereignty in such a union 
runs the risk of being outvoted, EU 
voting procedures give such coun- 
tries relatively large influence. 

While Sweden would have four 
out of 90 votes in the Council of 
Ministers of an enlarged union, Ger- 
many, with a population nine times 
larger, would have only 10 votes. If 
both Sweden and Norway follow 
Finland into the EU, the four Nor- 
dic countries would have 13 votes, 
more than not only Germany, but 
the UK and Italy too. 

Further, each country has a veto 
on questions determined by una- 
nimity. On questions decided by 
qualified majority, a small number 
of countries can block a decision. A 
small country can be influential if it 
builds winning coalitions. 

One argument for a No vote is 


that EU membership will bring few 
economic benefits, above those erf 
membership of the EEA This over- 
looks the economic dividends of 
greater influence on legislation and 
the increased investment in Sweden 
that membership would generate. 

Sweden’s public debt and deficits 
are among the largest In Europe. If 
it joins the EU it would be encour- 

A No vote overlooks 
the economic 
dividends that 
membership would 
generate 

aged to reduce both to meet eco- 
nomic convergence programmes. A 
reduction in the deficit would help 
lessen the damaging differential 
between long-term interest rates in 
Sweden and in Germany - now run- 
ning at four percentage points. 

Lower interest rates and the cer- 
tainty that future EU rules would 
apply in Sweden would also gener- 
ate an investment boom. This 
would help the unemployed and the 
young - as new entrants to the 


Observer 


soon there won't be a central bank 
governor left who can remember 
the third world debt crisis or the 
last time there was a run on a big 
US money centre bank. 


Buy one or stop me 

■ Strawberry ripple and tutti-frutti 
blocked traffic outside the mother 
of parliaments yesterday - 45 ice 
cream vendors protested against 
legislation allowing the confiscation 
of their vans for alleged illegal 
street trading. 

Ray Fionda - not a flavour but 
vice-chairman of the Association of 
Mobile Ice Cream Traders - 
believes bis members are suffering 
from legislation more suited to drug 
traffickers. “Confiscating a van 
which costs £45,000 is over the top,” 
he says. Sounds like a case for the 
Department of Transport's cones 
hotline. 


Home for Gomes 

■ Brazil’s finance minister Ciro 
Gomes promised to lower the job's 
profile when he took over in 
September. But so quickly? Gomes 
has annoyed so many businessmen 
and government officials that he 
has stopped giving media 
interviews for fear of starting any 
more rows. In Sdo Paulo this week 
he ended up fleeing from the press. 

Gomes has made some vicious 
attacks on companies which raise 
prices. Nor has calling Brazilian 



consumers "suckers" for paying 
high prices, and threatening to 
raise interest rates “sky high" 
greatly endeared him to Brazi lian s. 

Games says he will stay in the job 
until his close ally, president elect 
Fernando Henrique Cardoso, takes 
office on January l. What happens 
to Gomes then is anyone's guess; 
the portfolio for spreading goodwill 
and enlightenment is probably not 
available. 


Art for eats' sake 

■ Martel Duchamp would turn in 

his grave; he once sent shivers 
down the spine of the art world by 


labour market - by reducing unem- 
ployment, now running at 13 per 
cent of the labour force. 

Public sector employees, mainly 
women, would also benefit, since 
the sector's current size can he 
maintained only if Sweden’s indus- 
trial base is strengthened. 

Yet, as the referendum 
approaches, wishful thinking has 
flourished to avoid faring the hard 
choices. Some contend that if 
Swedes vote against membership, it 
would be possible to renegotiate the 
EEA agreement to gain greater 
Influence over legislation. This 
seems unlikely. The European 
Court of Justice struck down the 
only common Institution in the 
EEA agreement, the proposed EEA 
Court, as unconstitutional. And the 
Efta countries' negotiating power is 
less than when the EEA was negoti- 
ated, partly because the political 
will to accommodate them has 
diminished, and partly because 
there could soon be only two or 
three Efta members left in the EEA. 

Others, recalling the first Danish 
referendum over Maastricht, argue 
that a No vote cm Sunday would 
make it possible for Sweden to rene- 
gotiate its accession agreement. 


putting on an exhibition which 
included a lavatory. Tame stuff by 
comparison with the latest offering 
from Chinese artist Huang Yon 
Ping at Paris's Georges Pompidou 
centre. 

On Tuesday he assembled a group 
of spiders, scorpions, snakes and 
toads in an exhibition wittily 
entitled Hors Limites, Vert et la vie. 
1952-1994 - Beyond limits, art and 
life. They were to eat one another, 
making a statement on 
humankind's dog-eabdog world. 
Unfortunately, police closed the 
exhibition yesterday using laws 
forbidding cruelty to animals. 


Winkled out 

■ Having recently created a record 
58 new partners, Goldman Sachs 
probably feels it can afford to let 
slip a few other names. But 
probably not fixed-income chief 
Mark Wfakehnan. 

Hie departure of Dutch-born 
Winkelman is a serious blow to the 
investment bank. Several key 
partners - including previous 
chairman Stephen Friedman and 
head of its Japanese operation, 
Henry James - have now resigned 
in the last few months. And given 
that Goldman is struggling to 
recover from this year’s bond 
market crash, Winkelman’s 
razor-sharp trading skills will 
surely be missed. 

He Is withdrawing to spend more 
time with his family - yes, that old 
clichfi. But in September 


However, Denmark was already a 
member of the EU with a veto over 
the Maastricht treaty that gave It a 
strong negotiating position. 

A Swedish No vote would be simi- 
lar to the Swiss rejection of entry to 
the EEA in 1992. A debt-burdened 
Sweden on the periphery of Europe 
can ill afford to be an outsider. 

Finally, some have argued for a 
No vote to give the country space to 
make the final decision In a few 
years' time. But to stand by and 
watch other countries - including 
Sweden's closest neighbours - shap- 
ing the EU would be to miss a 
golden opportunity. 

EU members will hold an inter- 
governmental conference in 1996 to 
shape foreign, security and defence 
policies, relations with eastern 
Europe, agricultural and fisheries 
policies, and economic and mone- 
tary union. Now, if ever, is the time 
to join the EU. 

Per Magnus 
Wijkman 

The author is chief economist of the 
Federation of Swedish Industries 


Winkelman was passed over for the 
firm’s leadership. His fellow co-head 
of Goldman’s bond business. Jon 
Corzine, was named chairman and 
senior partner, while investment 
banking supremo Henry Paulson 
became vice-chairman. At 48, 
Winkelman is a year older than 
Corzine and the same age as 
Paulson: did he deduce his chances 
of becoming top dog were slim? 

What will he do, apart from 
enjoying domesticity? Goldman’s 
Wall Street rivals might be 
drooling, hut Winkelman insists he 
will probably move into teaching, 
like other Goldmanites who have 
gone before him. 


Call me or else 

■ Evidently the telephone is an 
endangered species. Dial-A-Gtft of 
Salt Lake City has just changed its 
name to “the Interactive Gift 
Centres Network”. The New York 
directory still lists 33 
dial-a-somethings, including Date, 
Mattress and Sewer Man. Given the 
onward inarch of political 
correctness, it can’t be tong before 
Interactive Waste Disposal Person 
makes an appearance. 


Comfort station 

■ The following sign was spotted at 
a railway station in Kent “Please 
note that the men's toilet has been 
closed today while work is being 
done. Sorry for any inconvenience.” 




16 


-- 

- jr; 


EMQDLeSTlSlaEB^ 


CONTRACT HIRE 


Manufacturer Qf . 


SELL AND LEASE SACK 

CONTRACT PURCHASE 


NORTH 0191 510 0494 
CENTRAL 0345 585840 
SCOTLAND 01738 625 031 


FINANCIAL TIMES 

Friday November 11 1994 


aerospace ground 
. power equipment & 


DALE 

□■RLE 

□RLE 

□RLE 


Dale Power Systems pic 


Tal07235vmf TOtac 52163 P^X 0723 516723 


French utility halts political 
payments in ethics campaign 


By John Ridding bt Paris 

Lyonnaise des Eaux-Dumez, one 
of France’s largest construction 
and utilities groups, said yester- 
day it was halting political con- 
tributions after a series of corrup- 
tion investigations that have 
shaken French business and poli- 
tics. 

The announcement is the most 
significant move so far by French 
companies, which are seeking to 
defuse allegations of corruption. 
It might push other large busi- 
ness groups to adopt a niwiiTay 
policy ahead of next spring’s 
presidential elections. 

Gdn&rale des Ramt , the princi- 
pal rival of Lyonnaise des Eaux. 
said it was re vi e win g its position 
on campaign financing 

Utilities and public works com- 
panies are the largest corporate 


contributors to political cam- 
paigns. Through their subsid- 
iaries. some of them have been 

linirpH to investigations of illicit 
financing of political parties. Sub- 
sidiaries of Lyonnaise des Eaux, 
for example, have been investi- 
gated in a case that forced the 
resignation in July of Mr Alain 
Carignon as communications 
minister. 

Mr Carignon faces charges of 
receiving funding for his political 
campaigns from a subsidiary of 
Lyonnaise des Eaux in return for 
awarding public-works contracts 
in Grenoble, where be is mayor. 
Lyonnaise des Eaux denies any 
wrongdoing. 

Mr Jerome Monod, chairman of 
Lyonnaise des Bans, said laws 
relating to company contribu- 
tions to political parties were 
complex and unclear. He had 


decided “to suspend all contribu- 
tions to political parties until 
new laws are promulgated to 

clarify appropriate conduct in 
this area”. 

The move reflects concern 
among fending - French business 
groups about the damage to their 
corporate image. 

GeMrale des Eaux is drawing 
up a code of ethics relating to the 
conduct of company o fficials in 
seeking public works contracts. It 
said it favoured legislation to pre- 
vent direct financing of individ- 
ual candidates or to restrict party . 
financing to the national leveL 

The National Federation of 
Public Works is preparing a code 
by which its 6,000 member com- 
panies would promise not to offer 
bribes to win the FFrlSObn 
($29bn) of public contracts they 
cany out each year. Bouygues, 


one of France’s largest construc- 
tion groups, has resisted the pro- 
posal and the implication of pre- 
vious wrongdoing, comparing the 
proposal to “a motorist promis- 
ing, from tomorrow, to obey the 
highway code”. 

However, the spate of corrup- 
tion investigations has prompted 
rails for stro n ge r action. An all- 
party par liamentar y committee is 
itisrn wring proposals to ban all 
direct corporate funding of politi- 
cal parties. 

• Police yesterday searched 
the headquarters of the Republi- 
can party, part of France's gov- 
erning coalition, during a judicial 
investigation into alleged corrup- 
tion. 

They were gppfctng documents 
that could shed light on the ori- 
gin of FFr2&n ($5j4m) deposited 
in party funds from 1987 to 199L 


Matsushita to head Bank of Japan 


By Gerard Baker and Agencies 
hi Tokyo 

The Japanese government last 
night nominated Mr Yasuo Mat- 
sushita, a former career bureau- 
crat who is now an adviser to 
Sakura Bank - one of the coun- 
try's largest commercial banks, 
as the next governor of the Bank 
of Japan . 

Mr Masayoshi Takemura, 
finance minis ter, said Mr Matsus- 
hita would replace Mr Yasushi 
Mieno when his five-year term 
expires next month. 

The appointment comes at the 
end of an unusually long wrangle 
In the government over the 
choice of governor. Mr Matsush- 
ita, a vice-finance minister In the 


mid-1980s, was thought to have 
been the favoured choice of 

finanf-A minis try officials. 

But Mr Takemura. in a display 
of independence, had expressed 
doubts about the appointment 
and mgjgfad on considering other 
candidates. His announcement, 
which is subject to formal cabi- 
net ratification, means the minis- 
try's views have prevailed. 

Mr Takemura was quoted as 
saying that Mr Mieno “strongly 
recommended” Mr Matsushita, 
who was chosen because of his 
intema tinna I experience ”"ii out- 
standing career in finance. 

Mr Matsushita joined the 
finance ministry in 1950 after 
graduating in law from Tokyo 
University. He rose to the top job. 


finance vice-minister, in 1 M 2 . but 
then joined the private sector. 

He is not expected to depart 
significantly from the policies of 
Mr Mieno, who has presided over 
one of the most turbulent periods 
in Japanese fmanriai history. On 
faking office in 1989 the governor 
raised interest rates to burst the 
speculative bubble of asset price 
inflation of the late 1980s. 

When that policy led to the 
country’s deepest recession since 
the second world war, Mr Mieno 
cut rates sharply. They now 
stand at their lowest level in 
nominal terms, though with 
inflation now negative, monetary 
policy Is still regarded by many 
economists as tight- 

The governorship usually alter- 


US inflation fears ease after 
drop in producer price index 


By George Graham 
in Washingto n 

Low prices for new cars helped 
US producer prices to foil last 
month by 09 per cent, blunting 
fears of rising inflation. 

The Labour Department said 
the drop in the producer price 
TTiripr m October, after anothe r 
0-5 per cent foil in September, left 
the change in prices over the last 
12 months at just l per cent 

US bonds took heart from the 
apparent easing of inflationary 
pressures, and early strength in 
the bond market lifted stocks. By 
lpm the Dow Jones Industrial 
Average was up 11.78 at 3,84393. 
The benchmark 30-year long 
band, after an initial surge, fen 
back to show a gain of A at 9314. 

While financial markets 
remain convinced that the Fed- 
eral Reserve must raise interest 
rates at the meeting of its Fed- 
eral Open Markets Committee 
next week, the evidence that 
wholesale inflation remains sub- 


dued may take the edge off 
mounting expectations in the 
markets that the Fed mi ght add 
as much as a full percentage 
point to interest rates. 

The Fed has preferred to adjust 
its monetary policy in smaller 
increments, because of the diffi- 
culty of readjusting policy if its 
forecasts should prove to be 
wrong. But bond market dealers 
have become fretful that the Fed 

International bonds — Page 21 
World stocks -Second section 

lx “behind the curve” in its 
actions to control any future 
inflationar y threa t, and even a 
half percentage point increase 
could disappoint the markets. 

Part of October's price decline 
was attributed to prices for new 
model year cars rising less than 
anticipated by the Labour 
Department's seasonal adjust- 
ments. But even without the drop 
in car prices, the index still feu 


by 0.1 per cent in October. The 
department’s index of core whole- 
sale inflation, Preluding volatile 
food and energy prices, also fell 
by 09 per cant, leaving a year-on- 
year increase of 19 per cent 

Some economists pointed out 
that prices for intermediate 
goods rose by 09 per cent in 
October and by 39 per cent over 
the last 12 months, while crude 
goods, excluding energy and 
food, rose in price by 09 per cent 
last month and by 13.1 per cent 
over the year. 

Most economists viewed the 
producer price data as good news 
for inflation. Statistics published 
earlier this week showed that 
unit labour costs have risen by 
only 09 per cent over the last 
year and that manufacturing unit 
labour costs have fallen by 
3.8 per cent in tbe same 
period. 

This lack of wage increases 
was expected to limit the upward 
pressure cm prices caused by ris- 
ing commodity prices. 


nates between Bank of Japan and 
finance ministry officials. Mr 
Mieno was a central banker, so 
Mr Matsushita's appointment 
ffnntrrwMB the pattern 

An indication that Mr Matsush- 
ita was about to secure the job 
came yesterday when he resigned 
as vice-chairman of the Tokyo 
Chamber of Commerce, a post 
that would be incompatible with 
his new role. 

Mr Matsushita is due to take 
over on December 17. The senior 
deputy governor will be Mr 
Toshihiko Fukui. a Bank of 
Japan executive director respon- 
sible for monetary policy. He 
replaces Mr Hiroshi Yoshimoto. 

Observer, Page 15 


Dublin halts 
IRA prisoner 
releases 

Continued from Page 1 

engaged in a transparent attempt 
to damage the peace process.” 

A statement from the IRA said: 
“On August 31 the ERA 
announced a complete cessation 
of military operations. AH our 
units were instructed accord- 
ingly. This position has not 
changed." 

Yesterday's killing came on the 
eve of a meeting between British 
and Irish officials to discuss the 
framework document which the 
two governments hope will form 
the basis of a durable political 
settlement in the province. 

Sir Patrick and Mr Dick Spring, 
the Irish foreign minister, are to 
discuss the document in the 
Republic of Ireland on Mon- 
day. 

There have been signs in 
recent days that the governments 
have made progress - particu- 
larly in the area of north-south 
relations - after a period when 
little progress was achieved. 


THE LEX COLUMN 


Insurance on the crest 


I Third-quarter profits from Commercial 
j Union and Royal Insurance demon- 
strate that the UK insurance sector is 
1 still riding on the crest of a cyclical 
i wave. But from here on It is likely to 
be a g entl e slide to the next earnings 
trough. The magnitude of the bounce 
in profits merely serves to highlight 
the sector’s incorrigible cyclicality. 

The niceties' of insurance accounting 
ensure that the slowdown in earnings 
from current levels will be gradual. 
However, rates in the key domestic 
motor and household markets - which 
account for nearly the lion’s share of 
Royal’s underwriting profits - have 
already dipped. They will slip farther 
as the onslaught from low-cost 
“direct” insurers continues Also set to 
deteriorate is the ratio of tfumm 
paid to premium iniwmff tha rec e n t 
improvement does not lode sustain- 
able. 

There are phis points. For example, 
insurers seem witting to forgo marke t 
share in motors rather flurn pursue 
new business at uneconomic rates. 
They are ai*o mnfn fanning pressure on 
costs, as highlighted by Royal’s plans 
to cut its UK workforce by 10 per cart 
over the next three years. But overall 
the medium-term outlook for the UK 
industry is for from bright 

The outlook for the shares is. how- 
ever, less dependent on the UK insur- 
ance cycle - or tbe management’s 
effort to d i v e r sify oat of it - than the 
state of world financial markets. 
Insurers’ investment income is highly 
geared to the market and a reversal of 
the recent sharp underperformance of 
the i te cto r Is likely to come only with a 
pronounced equity market rally. . 

Sears, Roebuck 

Though Allstate now sells little 
imamnirB through Sears sto res, the 
gro u p used to point to tax advantages 
to justify keeping the two businesses 
together. But *hwp tenrfife Hpptinp as 
Allstate’s underwriting performance 
improves. 

Sears has finally that inning - 

file tax break is a cost worth paying to 
set the two cnmpaniaa free. The mar- 
ket’s initial reaction was to mark 
down Allstate shares, partly an fears 
that a large p roportion of Sears’ inves- 
tors wlQ dump the new Allstate stock, 
while the Sears share price rose 
sharply- In the longer term , they may 
move the other way. 

While Sears win finally revert to 
being a focused retailing group, it 
faces a tough task clawing hack its 
position in the fiercely competitive 


FT-SE Index: 3103.5 (+3.9) 


Malta to tooAlFStaalFT-^A hidta wfc 


•100- V^ - - 1 1 


-1. . y 


. . • -HartaL. 
Source: FT <»***• 


1SS4- n 


American market. On the surface, 
Allstate’s situation is even more diffi- 
cult since it was hit by $845m of earth- 
quake losses in the first nine months 
of the year. Yet it Is financially strong 
with a powerful market position.. So > 
its prospects are healthy if only it can 
reduce its catastrophe exposure. 

hi this respect Tuesday's election, of 
a Republican insurance omnmissionar 
in California <could prove significant. . 
The new commissioner is likely to 
prove mare sympathetic to the indus- 
try's case than the present incumbent 
The election is also good news for 
BAT Industries’ Fanners unit, which . 
is even bigger than Allstate In Calif- 
ornia. A folly independent Allstate is . 
unlikely to be a more aggressive com- 
petitor. Bid its g tenter gterfr market 
visibility may MnpKasii» the value of- 
Farmers hidden inside BAT, .' • ' ; 

Shell 

Shell’s rock-solid balance sheet, 
which £T9bn in atid 

g g qn jfjft?, made flu AngloDntch com- 
pany a safe haven during recession. 
But the company's financial strength , 
makes it less attractive for investors* 
at this stage of the cycle. Shell is 
under-geared compared with Its rivals, 
so an equivalent rise in operating prof- 
its would have less Of an impact on 

earning s. 

The operational benefits of recovery 
are also lewt markmi. The group 
avoided the sort of crisis that farced 
BP to cut staff by 35 per cent in just 
three years. Without such problems, 
fflw»n haa found cost-cutting harder to 
implement. That was apparent in yes- 
terday’s results. Fra- the three mnnihg 
to September, Shell’s replacement cost 


operating profits, excluding one-off 

items, increased quarter an quarter by 
just .14 vpaf cehL Most . oil. majors - 
.posted x^Tdts-.up.between aol per cent 
and SO per cent- * . 

. ... Shell's Of faanria] a yfaft ;' 

. inveltor^iiould ; swi^^toto^^. Both' 
ShePanJ ite UK rival bw np a r' aH^iwA . 1 
highs. BheU^riih a prospective prica , 
earnings ratio for 3995 of 15, and BPat - 
ISA, are both at -slight premiums ttf- 
the market That is unusual fos-.aiR 
.companies, which traditionally grow 
more slowly than . th^ .ecoifomy. ■ Ttift. 
groups’ yields offer npgrBat jnceritffir 
either: Bp. has outperformed mar* - 1 
ket by 25 per. rent since April and' s 
Shell .by 10 per. cent That is enough 
far. now. . : / • 

Executive pay 

The Prudential Corporation has in 
the past been one of the stoutest 
defenders of directors’ three-year 
rolling contracts. So its expected aban-' 
domnant pf-such contracts may sound - 
their death-kneU througboai British 
industry. Wndi of Hi» credit suut go' 
to the high-profile campa ign waged by '■ 
MriAlastair Ross Goobey, PosTd’^ 
chief .executive. It’is surely no coiyig. 
rt>»wiv» - Hwt str Martin Jacom ciir- 
renffy PosTeTg chairman, ; is due to 
become the Pro’s chairman - next 
year. ■ . - -■ , .. : 

Even’ ifr-the Thu does sot joJu^Mr 
ROSs Goobey’s cfempaigh, [dhrectofe m 
other companies will find ft hatcShf'tb' 
ding to their .threeyear rollers; They: 
will, no longer .be' abjelto 7 point ta : < 
large institution's practice asjustifica- 
tion far their, own. . : V, 

- ‘ '.Rolfcra/MLcrw baffly-perfarmiog eseo- ' 
Ultras to receive large pscy-ofis if they 
are forced to resjgn. The abtqal&nqs : 
Involved are usually smdl-crah^sred‘ 
with, companies* market .capi talis e-: 
tions. Bid rewarding. failure in>'titis 

Way fateTBiftS' 

not merdy through the -dfrect^&iaii-: 
.-dal impact hot aim? -by-. giiidcnmrikigi 
employee relations. Rollers are a 
blatant example of one rule for. direc- 
tors and another rule for ordinary 
staff : ■ 

That said, the most important 
impact of PoeTel’s campaign may be 
to give a shot in the arm to share- 
holder activism. Institutional inves- 
tors have too often been prepared to 
walk away from poorly performing 
companies rather than seek to chang e 
their boards and/or strategies, ft is to 
be hoped they wffi now take a tougher 

linn. ■ 



FT WEATHER GUIDE 


Europe today 

High pressiro wiB maintain wintry 
coocfitions over Scandinavia and north- 
east Europe, while a low pressure system 
over the former Yugoslavia wai cause the 
Balkans to be wet and unsettled. Southern 
Sweden and Norway will have snow but 
clearing is expected from the north. 
Extensive snowfall above 1,300-1 900 m is 
expected in the Austrian Alps. Extensive 
rainfall w0l move from Austria and the 
Adriatic to Hungary and Romania. Thunder 
showers over the southern Balkans will 
spread to the Black Sea during the 
afternoon. Western Europe will be mostly 
cloudy, with showers limited mainly to 
Scotland and north-west Spain. 

Five-day forecast 

A fro n tal zone associated with low 
pressure over the north Atlantic wffl cause 
renewed rainfall over western Europe 
during the weekend. It wfll be warmer and 
drier next week. An advancing low wiD 
prevent wintry conditions over Scandinavia 
and Siberia from spreading to central 
Europe but the noth and north-east w3l 
remain coot. 


Abu Dhabi 

Accra 

Algiers 

Amsterdam 

Athens 

Atlanta 

a Aires 

BJwn 

Bangkok 

Barcelona 


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Mr 

10 

Caracas 

shower 

30 

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Cobtus 

Beffaat 

Mr 

11 

Canfift 

Mr 

12 

Frankfurt 

an 

30 

Belgrade 

Shower 

12 

Casablanca 

Mr 

21 

Geneva 

fair 

31 

Bertn 

doudy 

4 

Chicago 

shower 

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Gfcraltar 

Mr 

23 

Ounuda 

ttr 

28 

Cologne 

dnzi 

10 

Glasgow 

bred 

10 

Bogota 

doudy 

21 

Dakar 

am 

29 

Hantosg 

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21 

Bombay 

fair 

33 

Dates 

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Helsinki 

fair 

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Brussels 

doudy 

11 

Delhi 

srai 

30 

Hong Kong 

fair 

26 

Budapest 

fain 

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sun 

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fair 

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Wantxj 

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Cairo 

sun 

25 

Dubrovnik 

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17 

Jakarta 

Mr 

19 

Cape Town 

fair 

20 

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More and more experienced travellers 
make us their first choice. 

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Lufthansa 


Karachi 

KuwaB 

L Angeles 

Las Palmas 

Uma 

Lisbon 

London 

Luxboug 

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Madeira 


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Madrid 

Mr 

16 

Rangoon 

Mr 

32 

8 

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doudy 

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19 

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shower 

14 

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Mr 

23 

Singapore 

shower 

29 

28 

fiterai 

fair 

28 

Stockholm 

sun 

0 

29 

19 

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Monteal 

Mr 

shower 

14 

7 

Strasbourg 

Sydriey 

**SL 

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24 

31 

Moscow 

for 

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21 

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25 

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Nairobi 

Mr 

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Tokyo 

Mr 

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27 

Naples 

rain 

18 

Toronto 

shower 

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Nassau 

fair 

28 

Vancouver 

rain 

10 

24 

New York 

Mr 

14 

Vents 

nfn 

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22 

Nioe 

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rain 

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A re UK companies justified 
m persisting with Inland 
Revenue approved execu- 
tive share option schemes when the 
argument for their retention as an 
incentive has grown progressively 
weaker during the past io years? 

At the time they were introduced 
in the 1984 budget. Nigel Lawson, 
then Chancellor of the Exchequer 
said he was convinced of the “need 
to attract top calibre company man- 
agement and to increase the incen- 
tives and motivations of existing 
executives and key personnel by 
linking their reward to perfor- 
mance.” 

With the top marginal income tax 
rate of 60 per cent and 30 per cent 
capital gains tax that existed at the 
time, there was considerable attrac- 
tion among boardrooms in introduc- 
ing such schemes. They converted 
income into a capital gain and the 
cost of than was home by share- 
holders in diluted equity and did 
not i m pa ct on the company's proGt 
and loss account. 

Without hesitating to consider 
whether or not what they were 
doing was lair, both to shareholders 
and to other employees who did not 
- although the rules would have 
allowed it - benefit from such 
schemes, companies clamoured to 
introduce them to such an extent 
that now some 90 per cent of pub- 
licly listed UK companies have Rev- 
enue-approved share option 
schemes, mainly for directors and 


RECRUITMENT 

JOBS: Doubts linger over merit of executive share options as incentive or performance yardstick 

Time to spread the jam more evenly 


senior executives. 

Today, with the top marginal tax 
rate at 40 per cent, the same rate as 
capital gains tax. the tax advantage 
is less important. That has done 
little, however to stem enthusiasm 
for renewing schemes as many 
come to the end of their 10 year life. 

A newly published study of execu- 
tive share options, by Incomes Data 
Services Management Pay Review, 
suggests that probably the most 
important reason for renewing 
schemes is that companies dare not 
retreat from what has become the 
market norm. 

“Aoy company knows that it 
would be out of line with market 
practice if it jettisoned its option 
scheme, even if it was replaced with 
an alternative long term incentive,” 
says IDS. 

It quotes a conclusion by the 
board of Inchcape that failure to 
renew its scheme would have hin- 
dered its ability to recruit outside 
executives. 

The Labour Party says it will end 
income tax relief on options, but it 
seems doubtful whether that in 
itself will be enough to end the 
practice of paying them. 


Whether it would be applied on 
options already issued but not exer- 
cised is still unclear. 

While Gordon Brown, the shadow 
chancellor has estimated that an 
extra £200m a year will be collected 
in tax revenue, it represents only 
1.3 per cent of the £isbn that 
Labour suggests is the annual value 
of shares taken in options. Th3t fig- 
ure. however, is disputed. Some put 
it at less than half that amount. 

The main effect of ending income 
tax relief would be to make income 
tax due when the shares are exer- 
cised rather than CGT when they 
are sold. 

Given that only five per cent of 
executives have continued to hold 
their options beyond the three-year 
minimum period, the biggest signifi- 
cance or this would probably be the 
loss of the annual £5,800 tax free 
allowance for CGT. 

Perhaps the greatest unfairness to 
all other employees who did not 
benefit from the award of share 
options is that the options were 
Introduced on top of salaries and 
not instead of some portion of exist- 
ing executive reward. 

They were an unearned bonus 


that carried no risk whatsoever. It 
was like winning the Football pools 
without having to fill in the coupon. 
Neither were they related to the 
performance of companies. Only if 
the company did badly was there no 
point in exercising options. 

EDS says: “Gxecu lives could make 
large sums even if the share price 
rise had more to do with inflation 
and a general rise in the stock mar- 
ket than with their personal contri- 
bution. In some instances, poor 
company performance could lead to 
takeover speculation and share 
price growth, thereby giving a 
reward for bad results." 

T he volatility of share prices 
has made options at times 
something of a lottery. It was 
possible, for example, for a chief 
executive to be awarded options to 
buy shares when the market was 
high and yet for a less senior man- 
ager to enter the company and 
obtain options when the market 
was comparatively low. thus bene- 
fitting more than the company boss. 

Tarmac is one company which 
experienced unintended conse- 
quences. In its letter to sharehold- 


ers in May, it observed that many of 
the options granted to its executives 
under the existing approved scheme 
provided no effective incentive to 
management because the exercise 
prices were fixed at a high level in a 
different economic climate. 

“Further, their existence discrimi- 
nates against longer-serving execu- 
tives who have played a key role in 
the recent turnaround in the for- 
tunes of the group.” said the com- 
pany. 

In most cases, however, options 
have resulted in substantial gains. 
The IDS calculates that the median 
profit from options exercised in the 
last three years has varied from 
between £50,000 and £60,000. 

Among the highest profits under 
the UK arrangements found in the 
study were £2m and £1.7m made 
respectively by two directors of 
Glaxo Holdings in 1991. and £1.3m 
and £l.lm made by two directors of 
Smith New Court in 1993. In the 
same year, Clive Thompson, chief 
executive of RentokU, made £2.8m 
from exercising options. Sir John 
Egan, the chief executive of BAA, 
last year netted £l.6m from share 
options. 


That is dwarfed, however, by the 
sums paid out in the US. home of 
the share or stock option. Michael 
Eisner. Walt Disney's chairman and 
chief executive officer, realised 
$203m. equivalent to the gross 
national product of Grenada, when 
he exercised stock options in 1993. 

The intrinsic invalidity of such 
schemes has begun to be accepted 
in some companies. Reuters, Court- 
aulds and GEC have discarded their 
option schemes in the past year and 
replaced them with alternative 
long-term incentive arrangements. 
Sir Christopher Hogg, the chairman 
of Reuters, has called the assump- 
tion of a tight linkage between man- 
agement performance and share 
price “fallacious”. 

Under pressure from institutional 
investors' organisations, most 
renewed schemes have introduced 
performance conditions which must 
be met before options can be exer- 
cised. the most common of whicb is 
that growth in earnings per share 
should be two per cent above infla- 
tion each year over three years. 
Another trend is to phase options in 
with smaller annual grants. 

Very few companies have made 


schemes more equitable among all 
employees. Wellcome and ALPHA 
Airports Group, have introduced 
all-employee stamp option schemes 
that qualify under the same tax 
rules as the typical executive share 
option plan. The Inland Revenue 
does not specify that the schemes 
should be limited to executives. 

It is arguable that such schemes, 
in addition to being fairer, have 
greater tax merits for less highly 
paid employees. While all can take 
advantage of the annual Capital 
Gains Tax exemption, senior execu- 
tives might be expected to have 
greater overall capital gains, mak- 
ing the exemption proportionally 
less meaningful to them. As Sir 
Bryan Nicholson, the president of 
the Confederation of British Indus- 
try. this week joined in the criti- 
cism of large boardroom pay rises, 
arguing that business leaders have 
a “dear responsibility, moral and 
political, to set an example on pay 
discipline." it is perhaps time for 
companies to address honestly a 
fundamental question about share 
options: what purpose do they 
serve? 

Richard Donkin 

Executive Share Options is available 
as part of or annual subscription to 
IDS Management Pay Review at 
£202 a year. IDS, 193 St John Street 
London EC1V 4LS. TeL (0)71 250 
3434. 


Investment Analysts/Fund Managers 

Outstanding Career Opportunities for Asian Specialists 

L neg Henley -on -Thames 

Perpetual is one of die UK’s leading Unit Trust Groups with funds under management in excess of 
£3bn, and a record of outstanding investment performance. As part or our continued expansion, Me 
arc seeking to appoint high achieving investment analysts in the following areas: 


f, " ~ 

■ 

/ r 


• jr 

1 ' V. 

■\ - 








/. ... 
to* 


1 • ■■ 


Asia ex Japan 

An analyst is required for our Asia (ex Japan) 
department. The successful candidate will have 
at least three years' investment experience in 
the relevant markets, and will ideally he a 
qualified ACA or CPA, This is a fast growing 
department and the position holds considerable 
potential for career development. 


India 

An analyst/ fund manager is required to help 
spearhead our entry into the Indian market. 
Applicants should hold an ACA, MBA or 
equivalent qualiii cation and be prepared to spend 
extended periods of lime in India. This is an 
exciting position, in an area which will assume 
increasing significance within our Group. 


Successful applicants will have a proven track record and will demonstrate sound skills in financial 
analysis, together with an ability to make an active contribution to investment policy. 

Please send your curriculum vitae with a covering letter explaining the basis of your interest to the 
address below. All applications will be treated in the strictest confidence. 

Kathryn Langridgc (Ref: FT) 

Perpetual Investment Management Services Limited , jHn 

48 Hart Street, Hen Icy -on -Thames, 

Perpetual 

manner oj tmnsj “ w 


CJA 


RECRUITMENT CONSULTANTS GROUP 

2 London Wall Buildings, London Wall, London EC2M 5PP 
Tel: 0171-588 3588 or 0171-588 3576 
Fax No. 0171-256 8501 


Start up opportunity with potential for substantial earnings 

D IRECTOR - ASSET MANAGEMENT 
RUSSIAN SPEAKING 

MOSCOW . £75,000-£1 25,000 + BONUS 

JOINT VENTURE INVESTMENT BANK 

This new bank is a joint venture between a European financial group and important Russian banks and 
companies and will have corporate finance and capital markets divisions and an asset management division 
investing in Russian markets. The successful applicant will create the asset management operation from 
scratch and with the support of the Western Shareholder will put in place sophisticated systems for the 
management of collective funds. The Director will be responsible for sales/marketing and managing funds as 
well as supervising the day to day running of the operation. Fluency in Russian is essential and as a member 
of the board the Director will participate in the overall management of the bank. In addition to a strong 
analytical training and a minimum of 2-3 years' portfolio management experience, applicants must have a 
comprehensive understanding of asset management, a record of consistent business growth and experience in 
A managing a business unit An initial salaty of £75,000-2125,000 is negotiable, plus bonus and expatriate 
T package Applications in strict confidence quoting ref. DAM4999/FT to the Managing Director, CJA. 




Scope to transact business in all major bond markets 




CITY HIGHLY ATTRACTIVE PACKAGE 

EXPANDING EUROPEAN OPERATION WITHIN GLOBAL SECURITIES HOUSE 

Our client is expanding its consistently profitable Gilts team. Backed by good research and strong 
technicians, the successful candidate will join a medium sized stable team of individuals, servicing 
domestic and overseas institutions. We invite applications from candidates with a minimum of 2 years’ gilt 
sales experience and familiarity with euro-sterling, other government bond markets and repos. Prospects 
for career development are excellent. Initial remuneration (by way of high basic plus bonus) will be 
negotiable up to £100,000 in relation to experience. 

For this assignment we are particularly keen to hear from candidates in strict confidence by 
telephone on 071-588 5407 or alternatively written applications quoting reference IGS25651/FT will 
be forwarded to our client unless you list companies to which they should not be sent in a 

covering letter marked for the attention of the Security Manager, CJRA. — _ 

Opportunity to join a small team offering unlimited prospects for advancement 

Ami CORPORATE FINANCE 

JjNDONSWI £25,000 - £35,000 + BONUS 

INTERNATIONAL CORPORATE ADVISORY FIRM 

Our client is a small investment banking firm providing corporate finance and high level strategic 
advice to major corporations world-wide. For this entry level position we invite applications from 
numerate Graduates or those with some work experience. Familiarity with accounting and financial 
concebts and European languages would be an advantage. Responsibilities will include research- 
inn a wide ranqe of industries, financial and quantitative analysis, written reports, preparation of 
rtiant presentations and providing support to colleagues in the execution of M&A assignments. The 
nosfflon will involve client exposure, training In corporate finance in London and New York and long 
«raddno hours Initial salary negotiable £25,000 + bonus and full benefits package. Applications 
m strict confidence quoting reference CF25647/FT to the Security Manager, CJRA. 


Emerging Markets 

Global Investment Bank 

Competitive Remuneration Package 

Rare opportunity for outstanding individual to make career move into 
key trading role with one of the world’s leading emerging markets teams. 


City 


THE COMPANY 

♦ Premier European investment bank with extensive 
global network. 

♦ London office of successful global emerging markets 
team. 

♦ Active in all aspects of emerging markets finance 
including new issues. Excellent distribution capability. 

THE POSITION 

♦ Eurobond trader within global emerging markets team. 
Make primary markets and support sales team. 

♦ T rading global emerging markets eurobond book, 
working with counterparts in New York and Asia. 


♦ Top class training and exceptional career development 
opportunities in growing team. 

THE PERSON 

♦ At least two years’ relevant knowledge of emerging 
markets interest rare products, possibly in an analysis 
or research role or with previous relevant eurobond 
trading experience. 

♦ Ability to market the product through trading 
initiatives and close liaison with dedicated sales team. 

♦ Outstanding quantitative, interpersonal and 
communications skills. 


Please send full cv, stating salary, ref CN4582, to NBS, ID Arthur Street, London EC4R 9AY 



NBSF.LF.CUON LTD 
J BNd tv3.ninrcs pi.- company 


N:B-S 


Nj/ 


CITY 071 b23 153) 
Aberdeen 0224 638080 ■ Birmingham 02 T 233 4 hSb 
Bristol 0272 291 142 • Edinburgh 031 220 2400 
Glasgow 041 204 4334 - Leeds 0532 453830 
Manchester 0625 539953 - Slough 0753 SI9227 


BANK OF ENGLAND 


HEAD OF MONETARY AND FINANCIAL STATISTICS DIVISION 




This senior post has become vacant on the appointment 
of the present incumbent. Peter Bull, as Head of 
Statistics at the European Monetary Institute. The 
jobholder reports directly to Mervyn King. Executive 
Director in the Monetary Stability Wing of the Bank. 

The successful applicant is likely to have a degree in 
economics, with extensive experience in statistical 
techniques and familiarity with computer applications. 
He/she will have an in-depth knowledge of financial 
structures in the UK and abroad, especially in the EU, 
and an understanding of the use of statistics in the areas 
of financial policy and analysis. A broad knowledge of 
national accounts statistics is also desirable. 


He/she will need the personal and managerial qualities 
required to lead a Division of some 90 people. The job 
will involve co-operating closely with users of statistics 
in the policy and supervision areas of the Bank, with 
statisticians in both the UK government and in 
international organisations, and with reporting 
institutions and their representative associations. The 
international dimensions of the position will be of even 
greater importance in the future. 




The job will carry an attractive remuneration package. 

Please apply in writing with a full CV to:- 
Mrs J M Williams 
Personnel Division (BB-1) 

Bank of England 
Threadneedle Street 
London EC2R 8 AH 

The Bank of England is an Equal Opportunities Employer. 




European Fund Manager 


NORWICH 

UNION 


Norwich Based 


Norwich Union Investment Management manages funds in excess of £30 billion. 

We are now seeking to recruit an additional fund manager to expand our investment 
management team responsible for European Equities. The successful candidate will 
have specific responsible® and report to the head of European Equities. We place heavy 
emphasis on fundamental analysis and stock selection and are keen to talk to candidates 
who can demonstrate sound analytical skills and. If experienced, a good track record. 
In addition you should have effective communication and interpersonal skills. 

In return you will have the opportunity to develop further your research and fund 
management expertise in a team environment Some knowledge of the European 
markets would be advantageous. 

An attractive remuneration package awaits the successful candidate as well as 
excellent opportunities for long-term career development within Norwich Union 
Investment Management A comprehensive relocation package is available. 


For an informal 
discussion, please 
ring Stephanie 
Walter cm 01603 
6R3519 orsaula 
full curriculum 
vitae to her at 
Norwich Union 
Insurance, 

PC Bor -132. 
Sentinel House, 

37 Surrey Street, 
Norwich NRnPW. 

Norwich Umon 
is art equal 
opp ortunities 
employer and 

appheatmm from 
disabled persons 


-v- . :-t. • - .. 







H 


Major International Asset Manager 

Fixed Income 
Fund Managers 

London Based 

Our client, one of the largest Global Fixed Income Ftmd Managers, is part of an International 
Asset Management group which is, in turn, an integral unit within one of the world's leading 
and most loternarionaf Banking Groups. There Is a particularly wide diem base which indudes 
governmental, corporate and other sources. 

The main Fixed Income Group is London based and currently seeks two a d ditiona l Fund 
Managers. 

Senior Fund Manager 

This appointment has come about as a result of the promotion of the present incumbent to Head 
of Fixed Income. The previous occupant was the Group's European Fixed Income Specialist and 
Ideally, the person joining win have die same specialisation. However, we would also be 
interested in hearing from people with Dollar or \fen Bond expertise. 

The role calls for a person with seven to ten years experience, with a degree in economics or a 
related subject. The position involves considerable travel and carries all the advantages as part 
of one of the world's premier fixed income groupings/groups. 

Fund Manager 

We are aisn seeking a 25-50 year old to join the group/team. This job could appeal to someone 
who is currently with another Investment house or an insurance company and has a m ini m u m 
of three years experience of the investment business but Is not necessarily currently a fund 
manager. Once again, a degree in economics or a related subject is necessary. 

Our client adopts a top-down policy and operates on a team basis where decisions are arrived at 
by consensus. The posts therefore call for people who will welcome working in a sophisticated 
environment where contribution and Involvement are key. 

In addition to a generous salary, the company pays bonuses at a meaningful level and provides 
a full range of benefits. 

Please write in the first instance to: Colin Bany, the company's adviser on this matter. 
Overton Shirley & Barry Limited, Prince Rupert House, 64 Queen Street. London EC4R 1AD. 
Tel: 071-248 0355. Fax: 071-489 1102. 

OVERTON SHIRLEY 


& BARRY 


INTERNATIONAL SEARCH AND SELECTION 


APPOINTMENTS 

ADVERTISING 

appears in the 
UK edition 
every 

Wednesday & 
Thursday 
and in the 
International edi- 
tion every Friday 

For further 
information 
please call: 


Andrew 

Skarzynskf 

on 

+44 71 873 4054 


Philip Wrigley 
on 

+44 71 873 3351 


Joanne Gerrard 
on 

+44 71 873 4153 


City 


CREDIT ANALYSTS 

to £30,000 + bonus + banking benefits 


Continuing growth has created several opportunities for experienced credit analysts to join the corporate arm 
of a leading North American bank. These opportunities occur urithm the bank's Media, Energy, Corporate and 
Financial Institutions divisions. 

You will participate in the management of an expanding client portfolio, with specific responsibility 
for monitoring ongoing risk and completing annual reviews and sector reports. Increasingly, you will 
also be involved in marketing and client liaison activities - which should leave you well placed for 
subsequent advancement to a mote senior role within the organisation. 

You must have spent at least two years using corporate lending practices and analytical techniques, 
and will probably have benefited from a formal training programme within the banking industry. You 
must of course be PC-literate and will ideally be familiar with Excel and Word for Windows. Finally, 
a working knowledge of French or German could be a phis - but is not essential. 

If you would like to apply your credit expertise to the full- and are keen to undertake a more exciting 
challenge with a leading international player committed to significant expansion - send your 
comprehensive cv, in full confidence, to Stephen Knowles. 


Jonathan Wren & Co. Limited, Financial Recruitment Consultants 
No. 1 New Street, London EC2M 4TP Telephone 071-623 1266 Facsimile 071-626 5259 


JONATHAN WREN CITY 


i 


Global Investment Bank City 

Senior Futures and 
Options Researcher 

Onr client, one of the most prestigious AAA-rated international banking firms, and a market 
leader in Global Fixed Income and Derivative Products, seeks to add a senior quantitative 
researcher to its Futures and Options Research group. This group s up p ort s the Futures and Options 
Exchange-Traded Product sales teams across Europe and fa part of the global research team. 

Candid at es wfll have a numerical first degree, and pre fera bly a second degree (PhD or MSc), with 
a minimum of 2 years experience (probably in research) within the cash or d e riv ativ e interest rate 
markets. As a quantitative analyst, you wfll be required to look fix new and in n ovati ve ways of 
analysing and presenting market information in order to make relative value judgements and 
generate trade Mwm. 


I 

m 

SCI 


m 

V.v 

m 

4 

, v;>> 
kiS 


In addition to strong quantitative and spreadsheet abilities, candidates will possess excellent verbal 
and written communication skills in order to liaise effec tive ly with the sales teams, and with the 
bank’s clients. You will be exp e ct e d to create and p r esen t tr ainin g and m ar k etin g material which 
introduces new and complex ideas to clients, and to play an active part in developing these 
relationships. 


The position offers excellent career prospects within the firm’s inter n ati o na l network. In addition 
to a generous baric salary, the package wfll include a per for mance-related bonus, profit share and 
a fall range of hanking benefits. 

Interested candidates sfandcl submit a detailed curriculum vitae to AimabeBa Hump hreys at BBM Selection, 

76 Watting Street, London J5C4M 9BJ or contact her on 071 248 3653. All applications will be 
handled m the strictest confidence. 


76, Watting Street; 
London EC4M9BJ 




2 


Tel: 071-248 3653 
Fax: 071-248 2814 


ciTDsanEmi 


->vs -^x-w> 


1 
§ 

4 


OIL, COMMODITIES, 

PING EXECUTIVE 

Young CP. Experience in oil, c o n anorf t- 
BdOB oootraca - ope m kma. WxtedwUi 

Aaericu and British co mpanies . 2 j<aa 

in Africa and CAS. Seeks new asriga- 
Spedflc projects. Start ops. 

FAX: 44 81 211 7780 




Professional * Diligent • Adaptable 
International Connections 
Prepared to assist Managing 
Directors) wihi*jpni||ig iji.ihiiibhi 
or senu-retnemenL 
Please reply in confidence ux Box 
A2183, Financial Times, 

One So ut hw ar k Bridge, 
London, SB1 9HL 


Researcher required 

Ely investment company 2/3 days per week. The right person will 
have been employed within a merchant bank or similar institution 
with a knowledge of the Stock Market and/or company acquisitions, 
and now wishes to work on a part time basis. 

Circa £15.00 per hour + Commission, 

United Kingdom Investment Corporation. 

THL 081 852 0417 Fax. 681 318 3114 



Head of Finance and 
Administration 


c-£65.000 + Bonus + Banking Benefits 

Our client is one of Europe’s leading global financial 
institutions and has a significant presence in London. 
Following a period of sustained growth they now seek a 
Head of Support Services to positively impact the business 
and management structure. 

Reporting to the Assistanl General Manager, your 
responsibilities will include: 

• Full responsibility for finance, operations, administration. 

IT and settlements. 

• Overseeing accounting, financial systems, internal 
controls, tax and regulatory reporting for its operation 
companies. 

• To liaise with all echelons within Support Services and 
country management providing strategic input and 
direction. 


Location: Ghy 

-Significant ad hoc projects on behalf of the country 
management. 

Ideal candidates will probably be in their early to mid 30's, 
be qualified accountants or wfll have gamed significant 
financial experience within the banking sector.. You wIJI 
display common sense, commercial acumen and credibfllty 
combined with considerabte exposure » finance; operations 
and administration. All are essential for this high profile role. 
Management and communications skills will netessarib' be- 
ef the highest order fora fxwition of this seniority.' . 

K you believe yon have the required sk»H sets and drive for 
this unique position, please send a covering fetter and 
CV to our advising consultants Jonathan Kidd at Harvey. 
Nash Pfc, Dragon Court, 27-29 Maddin -Street,. London.. 
WC2B 5LX. CTei: 0171-333 0033). Please indude a daytinte 
telephone number, current salary detaBs and quote . 
reference number HNF1 1 6. 


HARYTY NA 


MI .r. 


World Class • • . Are You? 

Our client is one of the world's largest global investment management groups. They are one of a limited number 
of the few investment management groups that has a truly global operation. 

The group is structured as a worldwide team of specialists, each with a disciplined approach to investing and each 
with a substantial track record. As part of their commitment to excellence they have integrated all of their Retail 
Marketing through rhe UK. 

Thev therefore have a need to recruit a number of International Marketers: 


International 


International 


Marketing Manager Product Manager 


Working with one of the widest ranges of in temationai 
investment vehicles, rhe successful candidate will be 
charged with nor only enhancing already successful 
funds hut also successfully launching innovative new 
products into an increasingly competitive marketplace. 

An in-depth product knowledge of international funds, 
including regulation, is essential. Disciplined 
marketing skills and experience of" developing creative 
yet effective strategies are prerequisites. Equally 
important arc personal qualities - maturity and highly 
developed communication skills are paramount in 
order to establish professional credibility. Ref 208856 


Assisting the Marketing Manager, this is an ideal' 
opportunity for a well trained marketer who has the 
capacity to cope with the pace and range of work in 
this rapidly developing market. 

Ideally a business graduate and marketing qualified, 
you will have 16 months experience within either the 
retail, service or financial areas. You must be highly 
motivated, ambitious and able to offer first-class 
interpersonal skills. You will also need to demonstrate 
the ability to cope with the range and pace of work 
involved in working with international markets. 
Computer literacy is also desirable. Ref 209557 


In return, the company offers excellent career development and highly competitive salaries for individuals who 
match their exacting criteria. To express an initial interest please write enclosing fall CV and salary derails to 
James Gray, Manag in g Consultant, Michael Page Sales and Marketing, Page House, 39-41 Parker Street, 
London WC2B 5LH. 


Michael Page Sales & Marketing 

Spccrahsi Rreruinneni Cansulranis 
London Windsor Birmingham & Leeds 







PIA Supervision 

Policy Unit Member 


At the heart of the regulatory system for the UK financial 
services industry, the Securities and Investments Board’s (SlB’s) 
wide ranging responsibilities include overseeing the activities of 
the Personal Investment Authority (PIA). 

PIA is the new main regulator of the persona] financial services 
market which offers life, pensions, unit trusts and other 
investment products to the general public SlB’s PIA 
Supervision Department is dedicated to ensuring that PIA 
ddiven high standards of investor protection and regulation. 

The job holder will report to the Head of the Policy Unit in the 
PIA Supervision Department where responsibilities include: 

* evaluating PIA’s policies for the delivery of high standards; 

* assessing the validity and effectiveness of PIA S rules and 
guidance for investor protection in practice; 

* evaluating PI As monitoring and enforcement of member 
firms. 

Since the job holder will be complementing other members of 
the team, one of the particular responsibilities which he or she 
will assume will be die oversight of PIA's regulation of IFA 
members particularly with regard to their financial 
resources, custody of client assets and portfolio 


management activities. A proven facility in quantitative 
analysis will therefore be required. Furthermore 
candidates should: 

• be of graduate calibre possibly with an MBA, or accounting 
or legal qualification; 

■ have an enquiring mind and the capacity for original 

thoughts 

• have excellent communication skills, both written and oral. 

The person SIB is looking to recruit may have gained 
experience in any of the following areas: 

• financial services industry, direedy or through 
consultancy/audit; 

• regulation, preferably but not necessarily in the financial 
services sector; 

• investigation of financial impropriety; 

• compliance in the industry/as a consulting Lawyer. 

Interested applicants should Initially contact Sue Untern at 
Michael Page City, Page House, 39-41 Parker Street, 
London WC2B 5LH, lot an information pack, quoting 
reference 208880. Telephone 071 831 2000. 
Closing date 2 1st November 1994- 


Michael Page City 

Internal tonal Recruitment Consultants 
London Paris Fntuldun Hong Knag Sydney 


SENIOR 

DERIVATIVE 

CONTROLLERS 


c£60,000 
+ Outstanding 
Benefits Package 





This major integrated securities house commands a 
substantial share of the UK and international equity 
markets, and is a leading international player across 
a range of products and services. 

It is committed to developing its and analytical skills. Individuals 
equity derivative business and are likely to have qualified with 
seeks two high calibre individuals a Top 6 firm and be seeking an 
to spearhead its derivatives trader outstanding career opportunity, 
and management support team. 

For further information, please 

The team plays a pro-active role contact Simon /. Clarke on 
In the controlled and profitable 071-629 4463 (evening & 
growth of the business and weekends 081-769 1969) or 

liaises closely with traders and write to him enclosing a full 
senior managemenL Its key curriculum vitae at Harrison Willis, 

responsibilities include risk Cardinal House, 39-40 Albemarle 

monitoring and analysis, new Street. London W1X 3FD. 
product development, provision Fax: 071-491 4705. 
of management and trader support 

information and to act as an HARRISON 

interface with IT and Operations. . 

Ybu will have substantial exposure ® k L I u 

to financial markets, ideally 
derivative products, gained from 
a leading financial institution and 
will possess sound quantitative 


LONDON • READING ■ GUILDFORD • ST. ALBANS 
UXBRIDGE - BRISTOL . BIRMINGHAM 
BOLOGNE • COLOGNE - LISBON • MAOHO - PARC 
















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FINANCIAL TIMES FRIDAY NOVEMBER 1 1 1994 



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inager 


»ion 


HEAD OF PROJECT FINANCE 


EUROPE 

Highly Competitive Salary + Banking Benefits 


London Highly Competitive Salary + Banking Benefits 

O ur client, a leading international bank, is seeking a senior Project financier to head up and lead the Banks 
drive into Europe, the Middle East and Africa. The bank has a well developed international network and is 
looking for an ambitious and well connected Project Financier to capitalise on the Bank's reputation and resources. 

This senior appointment requires that the incumbent will have at least ten years’ experience of project finance, and 
will be expected to manage and motivate a team of structured and project financiers, operating in a very competitive 
and demanding environment in Europe, the Middle East and Africa. 

Ideally aged between 35 and 45 years, candidates will be graduates or MBAs and have an established reputation in 
the project finance market, and preferably experience of working in the United States or Asia. Stamina, sound 
negotiating and transactional skills are essential requisites for this exciting and challenging opportunity. A European 
language would be beneficial, but is not essential. Interviews will be arranged at suitable geographical locations for 
appropriate candidates. 


Interested candidates should send their curriculum vitae, including current remuneration package and 
daytime telephone number to Carol Jardine, Managing Director, Whitney Selection, 

17, Buckingham Gate, London, SWlE 6LB or fax 071 233 9334, quoting reference number WS/131/1. 


WHITNEY 


THE 

WHITNEY 

CROUP 


SELECTION 


<$ILX 


THE LONDOH 

Securities & Derivatives 

EXCHANGE 


Derivative 

Product 

Development 

£ Negotiable 


The OMLX exchange is one of London's six Recognised 
Investment Exchanges. It specialises in the trading of standard- 
ised and Flex™ futures and options on a variety of international 
equity derivatives. It is an innovative and progressive exchange 
committed to broadening significantly its product range. 

The exchange is now increasing the resources it devotes to prod- 
uct development and is looking for a PRODUCT DEVELOP- 
MENT SPECIALIST capable of being a leading player In a small 
and young team, reporting directly to the Business Development 
Director. 

He/she will be educated to a degree level, and possibly MBA 
qualified. The person chosen will play a major role in developing 
innovative new products in dose consultation with leading mar- 
ket partidpants. 

The successful candidate will already have a sound knowledge of 
the derivative markets, in particular regarding equities, and will 
have some experience of developing new products either within 
an investment house or in an exchange. 

This will be a key role within the exchange, and as such, will 
attract a competitive salary and benefits package related to the 
candidate's experience. 

To apply, please send a full CV including details of current 
remuneration to: 

Carole Machell 
Head of Administration 
OMLX, The London Securities and Derivatives Exchange 

107 Cannon Street 
London EC4N 5AD 




GROUP VICE PRESIDEI1T 


Investment 


Excellent terms = 


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A highly respected and successful Arab group plans to diversify <...d grow by 
making fresh large investments in different investment opportunities including, 
real estate development, trading and retailing activities, manufacturing, within the 
Middle East and Sub-Continent. Such ventures will be with well known international 
companies who are leaders in their areas of operations. 

The Group Vice President-Investment will critically examine proposals for 
investment received from Group companies or potential JV partners. Another 
important component of the job is to oversee the efficient and profitable deployment 
of excess funds in international markets. GVP-Investment will be a member of the 
Strategy Committee, chaired by the Chairman and the Group Executive Committee 
chaired by the CEO. The position reports directly to the CEO. 

The ideal applicant is a person who has at least 15 years of experience in money 
markets and project evaluation in a multinational and multicultural organisation. 
Experience gained with a well known investment/merchant bank or financial 
services company or international financial institution would be particularly 
relevant and useful; with the last five years being in a senior position equivalent 
to Director or Vice President 

The tax-free remuneration package is generous and includes top management 
expatriate benefits such as fully furnished villa, annual home first class leave 
passages, etc. The Group is situated in a cosmopolitan city in the Gulf which offers 
an excellent quality of life in a clean and safe environment. 

ff you ere interested, please write/phone (mf: MS/6624) 

E. A. KsWreagar 
Partner-in-Charge 

A. F. Ferguson Management Consultancy 
Express Towers, Nariman Point 
Bombay 400 021 , India 

Phone: 91-22-2022041/2022427 Fax: 91-22-2022769 





DC GARDNER 

INVESTMENT BANKING, 
TREASURY & RISK MANAGEMENT 

City based with frequent international travel 

DC Gardner Training is one of the world's largest 
provident of financial training to the banking sector, 
and is recruiting market specialists in the areas of 
Capital Markets, Treasury, Investment Management 
and Derivatives, to act as consultants within its 
Investment Banking and Treasury team. 

Consultants will create and deliver highly structured 
training programmes for mainly banking clients. 
Candidates will need to demonstrate a high level of 
technical expertise and a good academic background, 
probably gained through several years front office 
experience, for example, in a dealing room. In addi- 
tion. the personal enthusiasm and credibility to com- 
municate technical expertise in an authoritative and 
professional manner is an essential requirement. 

These positions arc likely to appeal to self motivated 
candidates wishing to embark on a POSITIVE 
CAREER CHANGE in order to capitalise on their pre- 
vious market experience. The ideal candidate is 
unlikely to be under 30 years of age. but excellent pre- 
sentational skills and professional credibility will be 
the deciding factor for the appointment. 

An attractive compensation and benefits package is 
offered. Please reply by November 25th with full CV 
to: Bernadette Swithenbank. DC Gardner, 
Nestor House. Playhouse Yard, London EC4V 5EX. 


* "'if'.!? 'Ji' TT'-oW 1 qgRBS SHT-m*!.* 


PARTNER 

EXECUTIVE SEARCH 
GLOBAL FINANCIAL MARKETS 

ACHIEVE INDIVIDUAL COMPENSATION UNRIVALLED 
CV THE EXECUTIVE SE/VRCH INDUSTRY 

The Tallis Group is an independent executive search firm that 
works for a select number of investment hanks and asset manage- 
ment companies on a range of London-based and iuieriuiliuiiui 
assignments. ]i has a reputation for producing a high quality level 
of service in a competitive environment. 

There is an opportunity for a Partner to join this busy practice. You 
will have a number of years 1 experience of executive search fn>ir 
selection) in relevant financial markets and as such will he achiev- 
ing a consistent level of personal billings. 

Find our more by contacting in strictest eonfidenve. 

Edward Clark. Chief nxecuiive, y t 

The Tallis Group, , \ 

95 A Chancery Lane. WC2A 1 DT, Jfc Mj) 

Tel: 071 430 1247 


JAPANESE DERIVATIVE SALES 

Package £100,000 

Credit Lyonnais Securities is currently looking to 
recruit an additional Senior Derivatives Salesperson 
to join its highly profitable Japanese desk in London. 

Credit Lyonnais Securities is one of the leading 
Quantitative broking operations and has developed a 
highly successful Japanese Equity business with 
offices in London, Tokyo and New \ork. 

We would like ti> talk to individuals who possess at 
least four years' experience of selling Japanese OTC 
derivative products to a UK and European 
Institutional client base. They should also have a thor- 
ough exposure to sophisticated quantitative tech- 
niques. 

In the first instance interested | 

Candida tes shou Id contact Y 

Michael Jones on 071 600 41 00 w*u.- )* .« 


attorney/solicitor 


3+ YEARS EXPERIENCE & 

STRONG RUSSIAN LANGUAGE SKILLS 
sought for Moscow office of major New York law firm. 

Please reply Lo Box A 2455. Financial Times. 

One Southwark Bridge, London SLT ‘till. 


O 








FUND MANAGER 

European Investments - £ substantial 

With funds under managemenr of £3 bn, Framlirtgroi) are looking for a 
motivated and disciplined fund manager ro strengthen and expand their 
European team. 

The Position 

The successful applicant will handle existing funds wirh responsibility 
for achiev ing strong and consistent performance. They will also be 
expected ro present ro clients as parr of new business development Mid 
ro rake a leading role in forming departmental investment policy. 

The Person 

Aged probably between 28 and 40 you will have worked for at least six 
years mainly in the European markers. An articulate and able presenter 
you must also be able to work closely anil harmoniously with vour 
col leagues whilst imposing a disciplined and strong management 
performance across a range of funds. 

Salary is negotiable but substantial and includes the benefits associated 
wirh a senior position in a leading City operation. 

Please write, enclosing a derailed CV ro: Stephen Watson, 

Frjmlington Group Pic, 155 Bishopsgare. I am Jon F.C2M 5XJ. 


I Opportunities at Deutsche Bank I 


v 

JLou have 4 years' 


JLou have 4 years' professio- 
nal experience in developing 
complex EDP applications in 
investment banking, treasury 
or MIS. You are familiar with 
the quantitative analysis 
methods in the financial world 
(securities analysis, statistics] 
and with the leading products 
in the money and capital 
markets. You have experience 
in data and function modelling 
and are already acquainted 
with a UNIX systems platform. 
You would like to participate 
in the development of forward- 
looking information and control 
systems in the financial sector. 


If you feel this description 
fits you. are highly motivated, 
have a good command of 
English and are able to work 
independently as well as in a 
team, you could be our new 
Systems Developer in our 
Organisation and Operations 
Division at Head Office near 
Frankfurt. Our Investment 
Banking Systems division 
develops, among other things, 
comprehensive risk and 
treasury information systems. 
This system is based on an 
.open" systems platform and 
uses the latest methods and 


Systems Developer 

Risk Management 



As Germany's largest 
private bank and one of the 
world's leading international 
financial institutions, we can 
offer you more than you may 
think. For example, a varied 
and interesting range of perso- 
nal training opportunities on 
and off the job and attractive 
professional advancement 
prospects. In addition, we 
offer a performance-related 
salary with a competitive 


benefits package. 

Please send your application 
along with certificates, 
references and your desired 
salary to: 

Frau Cornelia E. Hulla, 
Deutsche Bank AG, 

Personal (Zentrale), 
Alfred-Herrhausen-Allee 10, 
D-65755 Eschbom. 


Let's talk about it. 


Deutsche Bank 


El 


Senior Manager - 
Entertainment Finance 

Guinness Mahon is a major player in certain niches of the media sec- 
tor. We are currently looking to further strengthen a small and high- 
ly committed team with the addition of another first rate banker. 
The successful candidate will report to the Director, Entertainment 
Finance and will be responsible for credit assessment, documenta- 
tion, managing client relationships and assisting in business devel- 
opment. 

We require an experienced banker aged 30-40 who has had formal 
credit training and several years experience of corporate/commercial 
banking. Strong analytical skills and a good knowledge of spread- 
sheets and databases are essential prerequisites. Previous experi- 
ence of structured and project finance would be useful. 

The company offers an attractive salary and banking benefits pack- 
age. 

If you feel that you match the criteria above, please send your CV 
(including current remuneration package) with a covering letter to: 


Julie Allan, 

Personnel Manager, 

Guinness Mahon & Co Limited, 
32 St Mary at Hill, 

London EG3P 3AJ 



GUINNESS MAHON & CO. LIMITED J 

/ 







IV 


FINANCIAL TIMES FRIDAY NOVEMBER II 1994 


OPERATIONS DIRECTOR 


City 


(£50/000 + share options 


Our client is a leader in the provision of leasing to the medical, 
scientific and high technology sectors with a portfolio in excess of £100 
million. From its current base with NHS Trust lessees, the European 
operation expects to fulfill its coremission of serving the fullspectrum 
of medical, biotechnology, electronics and similar high growth 
industries during 1995. To complement the experienced marketing 
staiT, the appointee will exhibit proven underwriting, risk, portfolio 
administration and financial analysis skills. 

Candidates should have at least ten years relevant experience either 
in leasing, merchant banking, or investment analysis coupled to an 
understanding of scientific or medical markets. Equally important, 
this position requires seasoned judgement, energy and proven 
leadership skills. It is anticipated that an assistant will be hired by the 
successful applicant. Fluency in at least one major European language 
will be a substantial additional benefit. 

Please contact Peter Haynes 

No information zoill be disclosed without applicants' prior consent. 

Jonathan Wren & Co. Ltd., Financial Recruitment Consultants, 

No. 1 New Street; London EC2M 4TP 
Tel: 071-623 1266 Fax: 071-626 5259 


JONATHAN WREN LEASING 


INTERIM MANAGEMENT 

Ukraine; production of consumer goods with main empha- 
sis on finance/business management/organisation 


The Company: 100% sub- 
sidiary of an international 
FMCG-corporation with about 
650 employees, at the moment 
adapting to European produc- 
tion and quality standards. 

The Tasks: Cooperation with 
the focal Chief Executive 
Officer in all management 
areas especially in operational, 
organizational, economic and 
financial aspects (investments, 
foreign exchange policy, cash 
flow) and in joint realization of 
company targets. 

The Demands: Solid manag- 
ing and organizational experi- 
ence gained in producing firms, 
high adapt ability to local condi- 
tions together with staying 


power and stamina; good 
working knowledge of the 
Russian and Ukrainian lan- 
guage. Preferred age: 55 to 60 
years old. 

Our Offer: 2 year-contract: 
remuneration set to internation- 
al standards, including the cor- 
responding fringe benefits. 

Piease send your application 
to: MANAGEMENT SELECT 
Management Consulting, A- 
1190 Vienna Heiligenstadter- 
staBe 51. Fax (++43/1) 35 88 
777. 

Reference Number: 4411 


ots 


MANAGEMENT 

SELECT 

HAGER. WILHELM & PARTNER 

BUDAPEST . BRATISLAVA . UNZ . MOSKAU . PRAG . SALZBURG . WARSCHAU . WIEN 



T*«W*T» plea* *nd 
your luff cv. and a 
cunring leHerlo 
Annette McArthur, 
Human Resources, 
Citibank NA, 
PO Bax 78, 
336 Strand, London 
WC2R1HB. 


OBOND TRADER 

for our growing Euro-securities business 

Citibank is one of the world's leading financial institutions, 
providing high quality financial products and services to corporate, 
institutional and individual customers globally. 


In our profitable and expanding Euro-securities business, we have 
created an opportunity for a graduate calibre professional. Ideally, 
you will have at least one year's trading or related bond experience 
in a leading house. Independent in thought, objectively self-aware 
and a team player, you must have excellent numerical, PC and 
analytical skills. Self-confidence, commitment and energy are 
essential. Above all, you will be eager to take responsibility for your 
own work and quiddy establish your professional credibility, in 
order to progress as the business expands. 

A highly attract i ve remuneration package is offered, together with 
excellent career prospects. 

CmBAN«S> 


Wei 


en eqeal op] 


Mm* 


FT/LES ECHOS 

The FT can help you reach additional business readers in France. 
Our link with the French business newspaper, Les Echos, 
gives you a unique recruitment advertising opportunity to 
capitalise on the FTs European readership and to further 
target the French business world. 

For information on rates and further details please telephone: 

Philip Wrlgley on +44 71 873 3351 


CORPORATE 
FINANCE 
c£30,000 plus beneft 

City Iwsed Japanese 
Corporate Finance Division 
urgently require graduate 
with 5+ years experience in 
Underwriting Bonds, 
Euro-Medium Terms 
Notes and Securities. 
Fluency in spoken and writ- 
ten Japanese essential. 

Please send full CV to 
Box No. A2200 
Financial Times, 

One Southwark Bridge. 
London SEl 9HL 


Commission 

BASED SALESPERSON - 
UNLIMITED POTENTIAL 

Highly motivated self-starter 
required for new stock-market 
publication. Energy and 
enthusiasm as important as 
previous experience. 

Write to Bax A2193. FuuaciaJ Tuna. 
One Southwark Bridge, 

Loudon SEl WL 


The Top 

Opportunities 

Section 

Advertise your 
senior 

management 

positions 

to Europe's busi- 
ness 

readership. 

For 

information 

please contact: 

Philip Wrigley 
on 

+44 71 873 3351 

Joanne Gerrard 
on 

+44 71 873 4153 

Andrew 

Skarzynski 

on 

+44 71 873 4054 


WE’RE HUNTING FOR 
A HEAD OF INVESTMENT 
MANAGER RESEARCH 


THE OPPORTUNITY -Watsons needs 
jn ■mrsrjni.tine individual wirh a primary 
background in investment to oversee their 
investment management research 
programme. You w ill have the opportunity 
m influence the investment decisions of 
■ i tun v of Britain’s leading pension schemes, 
and plr. a part in Watsons widening role 
w ii h funds ••utside the UK. 

The responsibility of the successful 
candidate is to build on Watsons 
pre-eniineni position in the area of 
ms u'srmenr manager monitoring and 
sc I cl in in. This will invulve optimising the 
perform jiicc and processes of a team of 
experienced consultants who offer a broad 
range nf investment sen ices and skills to a 
gnswi n s el ien t ba se. 


the COMPANY - Watsons is a matter 
leading actuarial and benefits consulting 
firm with a reputarionfor the most exacting 
professional standards which includes 
advice sx> 40 of the rop 100 pension funds in 
the L'K. Watsons Investment Consultancy 
has captured well over 30% of the 
investment consultancy market through a 
dedication to creative flair wirh traditional 
professional values. Ir provides specialist 
advice to pension Funds on all key factors 
affecting investment management and 
performance. 

THE REQUIREMENT FROM YOU - to 
capitalise on this potential you will have to 
be good, very good. With strong powers of 
assimilation and analysis, you will have a 
proven crack record in motivating people. 


establishing systems "and - managing 

effectively. You will possess self-discipline . 
and a high level of pasonal drive, fbu will, 
be energetic, creative and committed. You' 
will have a good degree arid preferably an 
appropriate qualification. 

THE REWARDS - the career 
opportunities at Watsons are excellent. 
Through Watsons global alliance with The . 
VVyatx Company, Whams h extending its ' 
abilities worldwide. It is a demanding task 
and skills of the highest quality are - 
rewarded commons urareiy. 

If you hive the required talent and ambition p!e»e 
contact, in the strictest confidence: Stuart Cits. 
The Willis Partnership Limited. £3 Buckhtfum ' 
Caw, I^ndtmSWIE6LB.Telephon«071 8216543. - 

Wat sons 




DEPOSIT DEALER 

2 Years Experience 


% 




Standard Bank London Limited is the principal international mer- 
chant banking subsidiary of the Standard Bank Group of South Africa 
and is a leading market-maker in the South African equity, fixed inter- 
est, derivative and currency markets. 

The candidate will be expected to possess a sound knowledge of local deposit mar- 
kets. They will use their experience and initiative to help the growth of the Bank's 
deposit base. The successful candidate will display drive and ambition to secure a 
post with excellent prospects in a dynamic and rapidly growing institution. 


Standard Bank 

London 


Applications in rvriting to: 

Toby Jones, 

Standard Bank London Limited, 

Cannon Bridge House, 25 Dowgate HOI, London EC4R 2SB 







C 




\ompliance Officer 

Norwich 

Waters Lurmiss is the stockbroking arm of Norwich and 
Peterborough Building Society. Backed by the substantial 
resources ot a leading financial institution, the company 
has grown dramatically during recent yean. This 
expansion has led to the opening of new branches, the 
securing of high quality sources of new business and the 
introduction of innovative services. 

This position includes both internal and external 
compliance. The successful applicant should have a good 
knowledge of the rules of the Securities and Futures 
Authority as well as experience of working in a similar role 
within a medium sized firm which has a number of 
locations. 

Please apply in writing, with full CV. and current salary 
details, to. 

Stephen Alim. Operations Director, 

Waters Ltmmss mid Company Limited 
2 Redwell Street. Norwich, NR2 4SN 

A waters lunniss 

A member of the Norwich and Peterborough Group 
A member of the London Storfc Exchange and 5FA 


AM B25©0'0‘[]K]<a ®PP®B'u‘®BaDW 
p®0 dMPAGaasa ©p&acsQia® 
OSat&tJOST? B[sl®KSBS 

Recently opened London company (part of established 
international group) invites applications from Japanese 
speaking money brokers - based fn all currencies and 
products. 

Applicants must have market experience, a proven track 
record and should wish to be involved in an exciting and 
dynamic environment 

Only those with tenacity and a desire to succeed as part 
of a team should apply. 

Repfy to: Personnel Manager, 

Bax A2191, The Ftn&ncM Times, One Southwark Bridge, London SEl 8HL 


DO YOU HAVE A VIEW ON 
RUSSIAN EMERGING MARKETS? 

Then here’s an outstanding prospect 


City 


Our client is one of the worid’s most successful 

and highly regarded intiTnattfual fanVt 

Their coranritraent to developing their sales 
and trading capability in the em er g in g markets 
of Eastern Europe and Russia is reflected in 
the creation of a new team. To play a pivotal 
role within this team, our client is seeking a 
Russian national who has expert know ledge 
of Russia and can comfortably cross the East- 
West cultural divide. 

Ideally with contacts in financial, government 
and political spheres, yon will also need a 


broad insight into die Russian economic 
si tua tion , an entrepreneurial instinct and a 
Trader’s attitude’. 


To apply, send hill career details, quoting 
refclM* to Alasuur Lyon, Confidential Reply 
H a ndling Service; Associates in Advertising, 
5 St John’s Lane, London EC1M 4BH. 

Applications will only be sen! to this client bra 
please indicate any company to which your details 
should not be forwarded. 


ASSO 



RTISING 


f 


4 *. 


% STRATHALLAN 

BURSAR 

The G overnors of StruhaHan School, one of Scotiemfs loading eo-cducational 
toaniiitg schools, invite appti rations for a successor to Mqor W. Ainslie 
Bullanl, Bursar and Clerk to the Governors for Id years, who is due to retire in 
August 1995. 

Remun eratio n far the successful applicant, who wit] have sound fimmrni . com- 
mocnl and property management skills, win take into account both age and 
experience. 

Sonabiy qualified candidates should apply bi writing to tbs Oetk of the Board 
of Governors, StralhaHan School, Fotgaudcny. Perthshire PH2 9EG endodog 
ctoncolun] vnae, a handwritten letter and foe names of three referees. 

d **“ ** ^ application is Friday 25th November 1994. 

Selection win be made by end January 1995. 

St refr i ltra Sdtaat. fkr g i wtr .ii j , FfcrtMfc* PH2 M5G 
TfcL- 0738812504 Pnc V738SLRM 


ODDO 


AGENTS DE CHANGE 

Futures : Head 
of International Sales 

British national, 30 years old, with a Business or Engineering degree, you 
have 5 years’ experience in Financial Markets, preferably selling Futures. 

Facility with the French language will be appreciated. 

H We offer you the opportunity to develop the international activity of our firm, 
based in Paris, with respect to USA/UK diems. 

B Independent Brokers, highly capitalized, our strong share ownership quality 
(AGF, Caisse des D6pdis, San Paolo, Daiwa) gives us strength and ability to 
develop new opportunities. 

B3 If you are interested, please send your letter of application with CV to 
the attention of Mr. Philippe ODDO, at the following address : 

ODDO - 12, boulevard de la Madeleine - 75001 PARIS - PRANCE. 




FINANCIAL TIMES FRIDAY NOVEMBER 11 1994 


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Sail-’* 


A major Saudi Arabian financial institution is currently recruiting the following 
position, based at Head Office in Riyadh and within the Corporate Planning 
Division. 

SENIOR ECONOMIST 

The incumbent will Lie directly responsible for developing economic research 
capability, evaluating new and existing economic trends and providing critical 
analysis to appropriate divisions of the Bank. Specific responsibilities will include 
preparing a regular evaluation of the Saudi Arabian banking sector together with the 
Bank s own relative position and market share, as well as an ongoing analysis of 
global financial markets with u view to focusing on potentially new business 
strategies. Economic modelling and an ability to forecast the potential effect of 
various economic factors, interest rale movements and any other economic 
indicators is essential. 

The successful candidate will currently be working in economic research for a 
leading investment or commercial bank, or, an integrated securities house. 
Academic qualifications will ideally include a Phd in Economics with an 
undergraduate degree in a numerate discipline. An ability to present accurate 
published reports and in interface with Senior Management of the Bank is essential. 

The incutnhenl will receive a highly competitive compensation package consisting 
of a tax free salary (at source), paid housing, annual vacation air ticket and an 
opportunity to participate in the rapidly evolving financial sector within Saudi 
Arabia. Qualified candidates should direct detailed resumes including current 
compensation to: Box A2454. Financial Times, One Southwark Bridge, London SE1 9HL. 


SECURITIES Mg INSTITUTE 


SECURITIES INSTITUTE 
DIPLOMA 1993-94 PRIZE 
WINNERS 

The Securities Institute Prize for 
Excellence: Wfifjam Tucker, 
Douglas Trust A C or porate Services 
Ltd. 

The London Slock Exchange 
Award for Special Achievement: 
Amanda Lewis Ogden, Cawood 
Sadthle & Ca 

The ISMA Centre for Education 
and Research - University of 
Reading Bond and Fixed Interest 
Markets Award: Joyce Martindale, 
Natwest Investment Management. 
The IFMA Fond Management 
Award: Wiliam Kbtcn, Bril Lamie 
White. 

The Investors Chronicle 
Interpretation of Financial 
Statements Award: Anna Smart. 
The APCIMS Private Client 

Invest m ent Advicafc Mamagwni^i t 

Award: Brace Jobneon, Gemnd 
Virion Gray. 

The LIBA Corporate Finance 
Award: Warren Scott, KPMG Pea 
Marwi ck. 

The L1FFE Financial Fixtures and 
Options Award: Robot Kitchen, J 
Henry Schroder Wagg. 

The EXTEL Financial 
Institutional Investment Advice 
Award: John Sanity, Cazenove A 
Co. 

The REUTERS Investment 
Analysis Award: Jonathan Boyers. 
KPMG Pan Marwict 
-The SFA Regulation and 
Compliance Awmd: Jonathan 
J<aty. 

The SIMA Operations 
Management Award: James Muir, 
Barclays Stockbrokers. 

WINTER 1993 DIPLOMA 
WINNERS 

Abbott C(M W HargreaveJJale A 
Co); Adams H (Henry Cooke 
OmsdenPLC): (Kleimvorl 

Benson Private Bank}; Aiennan J H 
S (Gerrard Virion Gray ltd): Barb R 
A (Schraders)', Bennie G R 
(Kleinworr Benson ): Birch H T; 
Chong G W (Gall A Eke 
LimtieflCockctt A A: Coombs P AC 
(Barclays De Zoete Wedd); 
Cresswcll A D (NU±o Europe PLCf, 
CotT M J: Davidson I G (Gnsig 
Middleton A Ca Ltd) - . Doherty M 


( Hill Samuel Private Ciient 
Management Ltd)\ Fairborn G R 
(Capel-Cure Myers Capital 
Management Ltd); Frosi S J 
( Barclays De Zoete Wedd Services 
Ud): Ganeshan D, Gem N A (Allied 
Provincial Securities Ltd?, Gibaul J C 
(Standard Bank Investment 
Corporation Jersey Ltd): Hale l M 
(Cripps Harris Hall); Harris P A 
(Albert E Sharp A Co): Hazle A J 
(Hoorn Govett Ltd): Henderson M J 
(Natvrest Stockbrokers Ltd); 
Hickmore LS N (Albert E Sharp A 
Gob Hordeway P R V (Kbanwon 
Benson Private Bank J. Hu$i Smith P 
(Capel-Cure Myenf, James S D 
(Mercury Asset Management); Kelly 
M * M (Salomon Brothers 
International Ltd); Kelly P R 
(Kleinwort Benson Investment 
Management Ltd): Kinnaird A 
(TUney A Co); Kirton W S R (Bell 
Lamia Write A Co Ltd); Kosak M 
(Barclays DeZoete Wo&Q-.LaniglC 
(Lehman Brothers); Le MessnricrS 
P; Lea L (J Henry Schroder Wagg & 

Coy,lxriisA3(pwDRenrimrgUd): 

Lewis Ogden A L (Cawood Smithie 
A Cb); MacKinnon RD (Beg lawrie 
Write A Co Ltd); McQymom S J 
(TUney A Co); McGregor A C (fUney 
A Coy, Nasar H; Newsome CPS 
(Albert E Sharp A Co); PeuBrimy 
D J (Wire Speke Ltd); Pitman W H 
(Cazenove A Co); Platt R D; 
Plummer S (Wise Speke Ltd); Price E 
H O (Barclays De Zoete Wedd): 
Pritchard H S K (/Uben E Sharp A 
Cdt, Roberts HXPastri bneanent 
Management): Robertson C C R 
(Capel-Cure Myers Capital 
Management Ltd): Rudd J H 
(Kldnwart Benson Securities Lid); 
Shaw R J (BWD Rcnsburg Ltd); 
Stone G W; Strange B E; Tangea N 
(Catpnme A Co); Tiylor G D JfiWD 
Remburg Ltd); Tickle G Y; VauxJ N 
(Guinness Mahon A Co Udf, Weaver 
j 0 R (Cazenove A Co); WflkmsOaS 
P l AMAS UK Udy, WMim T J R 
(lames Capet A Go Ltd). 

SUMMER 1994 DIPLOMA 
WINNERS 

Bailey A P (Midland Stockbrokers); 
Baker S A (filbert E Sharp A Co); 
Berks P W (Dabwa Europe Ud): Ben 
P C J; Broadhust M A (Albert E 
Sharp A Co); Carroll A (John SiddaR 
A Son Ltd): Ctataon M W ( Credit 


Suiise Asset Management)-, Clegg p 
{Allied Provincial Securities Ltd); 
Davies K M (Kleinwort Benson 
Investment Management Ltd) 
Draycou S J (Allied Provincial 
Securities Ud) Ercfcine-Murray T A 
E (South New Court PLCy, Farthing 
J A [Wise Speke Ltd); Fenton W R 
l Hill Osborne A Co); Fernandes P L 
(Fleming Private Asset 
Management); Fisher J A S 
(Cazenove A Co): Gambhir A (NM 
Rothschild & Sons Ltd) Grimsley I D 
(Fidelity Investment Services); 
Hagne-Holmes G M (Lehman 
Brothers); Hanby A R; Harnett PS (C 
Aitken Asset Management Co Ltd) 
Harries D H (Cazenove A Co); Hanis 
C P (Hill Samuel Private Client 
Management Ud); Hartley C J 
C Foreign A Colonial Management 
lufrHeathGJM (The Securities A 
Futures Au thority); Hetherington AL 
(Wolverhampton Borough Council); 
Hickey A K (Scottish Equitable); 
Hobart C H T (Beeson Gregory Ltd); 
H organ Goomas E A (UBS Ltd); 
Hougbun-Brows P (AMP Asset 
Management); LeTocq J; Leach F S 
(A Ibert E Sharp A Co); Liuesey J 
(TUney A Co); McCann N S 
(Cazenove A Co); McGeown N; 
MdverRDF (Schroder Investment 
Management) MUae G G (TUney A 
Co); Moran J E ( Goodbody 
Stockbrokers); Muir J A (Barclays 
Stockbrokers Udf, ; O’Dwyer J P 
(Bmadbridge Stockbrokers); O'Ntill 
A (Gerrard Vivian Gray Ltd); 
O’Reffly EC;0 , RaurfceH;PainC W 
(Capel-Cure Myers Capital 
Management Ud); Fedley C (TUney 
A Co); Price CDB; Rade S: 
Reynolds E ( Scottish Equitable): 
Richmond T S (Albert E Sharp A 
Go); Robertson S (London Stock 
Exchange); Rutherford S; Stead D 
M ( Foreign A Colonial 
Management Ltd), Stevens M J 
(Lloyds investment Managers Ud) 
Stevenson S J ( Coates ViyeUa); Sion 
V (Albert E Sharp A Co); Tabor A A 
H; Tomkins J R (Barclays De Zoete 
Wedd): Topp C M (BWD Rensburg 
Ud); Tucker W J (Douglas Trust A 
Corporate Services Ltd); Walch S C: 
Walker G R(Do/wo Europe Limited) 
Wdd Rjrcster A S (NCL Investments 
Ltd); Williams D C (Cawood Smithie 
A Go); Wills R G (Nicholson Barber 
A CO). 


Company names are those sponsoring the student for the final paper 


* 


Congratulations to all our successful candidates 

MORE PEOPLE PASS WITH US 

■ unrivalled pass rates — on average a 20% premium 
over all other providers 

■ unparalleled facilities at the heart of the City 

■ class sizes average below 31) 

■ more tutors and better support than any other 
training company 


For more iiilemurion. plttst' rail Eikrni Doyle ac 
Financial Training Special*: [Simon. 

New London Hume 
ti London Snees 
London EC3K 7LQ 

Telephone: 071 265 1011 Fare 071 265 0337 



THE 

FINANCIAL TRAINING 
COMPANY 



HYPERION 

Training 

Unrivalled Quality & Experience 

For tafornration on onr training courses for the securities and 
derivatives industry, please contact Marcus King on 
071-374 4007 

Hyperion Training Limited 

dth Floor 3 London Wall Buildings, London Wall. London EC2M3PD 
07l-3»m7 to 071.3Utm 


A HIGHLY QUALI- 
FIED 

BILINGUAL SWISS 
FOREIGN EXCHANGE 
AND MONEY MAR- 
KET DEALER, 

39 

With wide experience in 
all aspects of money mar- 
ket - Arbitrage, Cross 
Dealing, Forwards, 
Options, Euro-Deposits 
and Fra’s. Excellent 
Commnnication end 
Management skills. 
Goal Orientated, is 
searching for a new chal- 
lenge in an international 
bank 

which recognises results. 

Please Write: Box No. 2190 
Financial Times. 

One Southwark Bridge, 
London, SE2 9HL 


Even in an operation as dynamic as 
The Royal Bank of Scotland the success of our 
Treasury and Capital Markets business unit is 
exceptional. Part of the Bank's Corporate and 
Institutional Banking Division, the Treasury has 
doubled in size in the past two years with 1994-95 
growth expected to be just as fast. 

This has meant a substantial investment in both 
technology and in specialist staff and we now 
require another Spot FX Trader for our Edinburgh 
operation. 


SP OT FX 
TRADER 

Treasury & Capital Markets 

EXCEL L EX T PA CM1 GE 

EDINBURGH 


You will be currently working within an active 
trading Bank. You wiU have had at least five years' 
relevant experience and you should have excellent 
interpersonal skills. 

You can expect a highly competitive package, with 
usual banking benefits and, where necessary, 
relocation assistance. 

To apply, please write enclosing a full 
CV to Victoria Wallis, Personnel Department, 
The Royal Bank of Scotland pic Regents House, 
PO Box 348, 42 Islington High Street, 
London N1 8XL. 


ii 


Commuted to Equal Opportunities 

wc 

Art 

The Royal Bank Of Scotland 

WHERE PEOPLE MATTER 




Three Consultants 
Required for Established 
City Headhunters. 

Sheffield International Limited are a specialist international head- 
hunter. We wish to strengthen our team with the recruitment of | 
three additional professionals to specialise in the following sectors 
for our City based and Internationa] financial services dients:- 

- Institutional Equity Research & Sales 

- Corporate Finance and Banking 

- Finance ; Administration & IT 

Each consultant will have come from a financial services industry 
background and have had successful professional working experi- 
ence in the sectors they will be covering. Each will also be a sound, 
effective and professional business generator as well as capable of 
executing retained assignment in a successful, thorough and rigor- 
ous manner. 

Please apply in writing to s- 
Sheffield international Limited 
Aldermary House, 10 - 15 Queen Street, London EC4N IT] 


Equity Sales 

South East Asian Region 
Aged 25-29 


Our cbenc. a major Brush-based international 
stockbroker with an extensive range of overseas uffices, 
has a number of vacancies for sales professionals to join 
their expanding Asian sales department in London. 

The firm plays a major role in raising equity and long tom 
finance tor British and overseas companies cnciuiiing efio*.- 
from Asia and is supported by a wide range of research 
documents produced from (jut diem's Asian offices. 

Candidates aged 25 - 2*> should have a high standard of 
education and be conversant with at least three of the 
Asian economics one of which should be Hong Kong. 
Ideally, they should have had an accountancy or research 
background, ro enable them to obtain maximum benefit 
from visiting the management of Asian based companies. 

This is a career opportunity and calls for confident, 
presentable, sdf-monvated individuals with first class 
communication skills and the ability to work in a 
team environment. 


Please apply to Jack Courts. Career Plan Ltd, 33 John's 
Mews. London WON 2NS. TeL 071 242 5775. 

Fax: 071 831 7623. 


Caxaeer 



Personnel Consultants . 





Fixed Income Analyst 

Outstanding opportunity in join nnc of the world’s 
premier Fixed Income advisors. Research worldwide fixed 
income and currency markers and assist Portfolio 
Managers/Senior Relationship Managers in devising 
innovative way* to communicate investment strategy, 
portfolio risk, market risk, and the value of active bond 
management to clients, consultants and prospect?. 
Graduate in finance, economics, or engineering with high 
degree of computer literacy and knowledge of fixed income 
markets, lixcclknc remuneration. London EC3. 
Please send CV to Jonathan Jay, Jay Curtis Elliott, 
200 Tottenham Court Road, London WIP 9LA. 



Jay Curtis Elliott 




oft. 

;J r f* A-.Vi 

.j'.... ,>iLii>r 


aszaastnsxia 

Irf/v.* 

/'H 


Genera! Manager 

£ Substantial /Negotiable Kenya 


?. "i. o I 


-■I 






■ The Sotik Tea Company Limited is a large and successful lea growing and 
processing company centred on plan unions located some 100 miies \ivst of 
Nairobi. Owing to the panned reliral of the present incumbent at the end of 
1995 there is a requirement to recruit a new General Manager. 

" This senior appointment encompasses alt aspects of profitable plantation 
and factory management and assumes responsibility for a workforce of some 
lour thousand people. 

■ The prime requirement is for an experienced plantation manager who has the 
: ability to thrive in an isolated environment. Likely candid,] tea Hill be sound 

’ administrators, posses s highly developed interpersonal and communications skills 
and be committed to a five year period of company growth and development. 

■ Age: Candidates under the age of 40 are unlikely to have the breadth and depth 
of experience required. 

• Remuneration.- A negotiable and highly competitive salary and benefits package is 
prorided plus a substantial bonus element. 

■ Mease reply in complete confidence to Muir Morrison as adviser to the company 
at Ernst & Young Corporate Resources, Ten George Street, Edinburgh, EH2 2DZ, 
United Kingdom. Tel: 031-247 5211. Fax: 031-247 5334. 

HI Ernst & Young 



THE EUROPEAN INVESTMENT FUND 

a new financial agency based in Luxembourg, 
is looking for: 

experienced 
credit analysts 

for senior and junior positions in its operational department to appraise and prepare 
proposals for guarantee operations in support of king-term invesbneiitiri twoareas cf 
crudal importance for the economy of the European Union: R 

• transport, telecommunications and energy infrastructure fartherin g the e s ta blish ment of 

Trans-European Networks (TENs); j.Vi - ' \.r.- y T 

• small and medium-sized enterprises (SMEs). , f • 'A[. \ ■ ’ ' - V 

Applicants should be educated to unheretyitjeyetbf’ eqrivakd aiidlviyaat least three 
years' experience of financial analysts in tfvz reference to risk 

evaluation and/or structuring of guarantee5. Uyey sttoi&i have twlriarfceting sidDs necessary 
to identify and originate business bridge fluent mEngftsh andatte^stone other Community 
language. k-' 


(m/f) 



Tbc EIF was set up In 1994,. ... 

European Commusion ta^)cgroap 
Ctf ■wter cwmtto jffr w ri f ai li to 
sectors and thereby <to«riqaiariqte th* 
Commnnity ccn 

The Fund is 

information oil be obtiAl^d frotgW^kte^rt at 
should be salt tCf tihrf as itoos ; nir|xNBftdp. AM 4 
confidenceandwffloot be nattOTOl': 
EuropeWkwesbrnadFimct 
L2950WJXEMBOURG. 

~ — 



Bank, the 

fctdiaRom ftwn the 
in tike TENS and 5Wb 

capital in rapport of 

mention package. Further 

;1^ek3w. Written applications 
be treated in strictest 


:4:i . 


'■#L 




Saudi hollandi bank 

CHIEF DEALER FOREX 
AND MONEY MARKETS 

A well established, internationally affiliated Saudi Arabian 
joint-venture bank, is seeking applicants for the above post. 

The successful applicant will be responsible for managing a small 
team of professional dealers in the Foreign Exchange and Money 
Markets as well as Its derivative products. He will be responsible in 
maintaining and establishing excellent working relationships with 
local and foreign banks as well as providing first class service to the 
Corporate Banking Unit within the Treasury. He should know the real 
meaning of the word quality and be able to stimulate and motivate 
people to the optimum. Suitable candidates should be aged between 
30 and 40 years and should have at least 10 years of proven 
profitable Treasury experience with leading international banks. 

Candidates should possess college/university qualifications, be 
familiar with and be able to use current PC applications, demonstrate 
excellent communication skills and have a proven ability to work in 
a team of mixed nationalities. 

The position offers competitive compensation with tax free salary, 
accommodation/transportation/ticket allowances and medical plan. 

Apply in (nnfidence by fax or mail to: 

The Treasurer, Head Office, Saudi Hollandi Bank 
P.O. Box 1467, Riyadh 11431, Saudi Arabia 
Fax: 966 1 405 0968 or 405 0973 


ASIAN EQUITY SAT.ES 


GK 


SECURITIES 


G. K. Goh Securities (UK) Ltd is looking to recruit two additional 
salespeople to join its fast growing London sales desk. The new 
recruits will market to institutional clients in London, Europe and the 
US. 

The ideal candidates will have a minimum of one years experience in 
Asian equity markets, either in sales, research or fiind management. 

Interested candidates should send their CV in confidence to: 

Ms L Collier, G. K. Goh Securities (UK) Ltd, 

Saddlers House, Gutter Lane, London EC2V 6HS 


G. K. GOH GROUP 


G. K_ Goh Group is a Singapore based instihitiemal broker, sperialfaing to toe Singapore, Malaysian, Indonesian, Hong Knag. 
Philippi ik and China studanarices. G. K. Gob has Offices to Singapore. Kuala Lumpur. Mdak*. Jakarta. Hong Kong and London. 










FINANCIAL TIMES FRIDAY NOVEMBER IHSM 


VI 


ACCOUNTANCY 


Bright outlook forecast, but not guaranteed 

Jim Kelly reports on the new rules on ‘going concern statements which make explicit their judgments 


M aking a statement 
that a business is a 
going concern 
should be viewed in the same 
way as a weather forecast It is 
a judgment based on available 
data at a point in time. It is not 
a guarantee of fair weather. 

No one would think of suing 
a weather forecaster after a 
holiday ruined by rain. How- 
ever, we might be justifiably 
annoyed by a 24-hour forecast 
which failed to notice the 
approach of a typhoon. 

The problem with the con- 
cept of going concern is that it 
is seen by many shareholders 
and investors as providing a 
guarantee against collapse. 
When things go badly wrong 
they feel aggrieved. 

The late 1980s provided a 
string of examples of company 
collapses within months of the 
publication of accounts, 
audited without qualification, 
and containing the assumption 
that the company was a going 
concern. 

Creditors sought to appor- 
tion blame and turned to the 
auditors. The situation cruelly 
exposed an “expectation gap". 
If the company concerned was 
a going concern eight months 
ago why was it now revealed to 
be nothing of the sort? What 
had the auditor missed? What 
had the directors failed, to tell 
the auditor? 

This week the Audit Practice 
Board and the Working Group 
on Going Concern, with mem- 


bers from the institute of Char- 
tered Accountants, the Hun- 
dred Group, and the Institute 
of Chartered Accountants in 
Scotland, have between them 
attempted to clarify the 
responsibilities of auditors and 
directors with respect to going 
concern. Their work is a direct 
response to the corporate fail- 
ures of the 1980s. 

Both have been keen to 
make plain what going concern 
Is not. It is not a cast iron 
prediction. It is a judgment 
made on the available evidence 
at a point in time. That judg- 
ment is based on the informa- 
tion provided by the directors. 
It is not a guarantee the com- 
pany will continue to trade. 

What going concern is has 
become much clearer this week 
and the APB and the working 
group deserve credit for co-or- 
dinating their findings and 
coming up with a practical 
framework. 

The only danger is that they 
may have difficulty in 
restraining public expectations 
in the future. 

The APB's Statement of 
Auditing Standards (SAS) 130 
replaces the old auditing guide- 
line which was widely critic- 
ised for giving the auditor a 
passive role on going concern. 
Unless the auditor literally fell 
over contrary evidence the 
business was presumed to be a 
going concern. 

SAS 130, which covers ail 
audited companies, requires 


the auditor to take a pro-active 
role and to consider, rigor- 
ously. a business's ability to 
continue as a going concern. 
That ability should extend into 
the “foreseeable future” - 
which is not strictly defined. 

However, if directors of the 
company in question consider 
a period of less than one year 
from the date of the approval 
of the financial statements and 
do not disclose it, the auditors 
must record this in their basis 
of opinion. 

I bis subtlety can be seen 
as the APB watering 
down the rigor of the 
standard or introducing a prac- 
tical recognition that some 
businesses, such as a fashion 
house faced with an unpredict- 
able spring season, might not 
be able to provide the detail 
required for such a period. 

The auditors, under SAS 130. 
should qualify their opinion if 
they think the directors have 
not backed up their assertion 
of going concern with adequate 
information. The auditors 
should register an adverse 
opinion if they disagree with 
the assertion. 

Michael Boyd, chairman of 
the task force that produced 
the standard is sure it will not 
create a “make work" project 
for companies. It is not manda- 
tory for companies to provide 
cash Sow forecasts or budgets 
to back up going concern. 

For many companies no 


extra work will be needed. 

The standard is effective 
from June 30 1995 although the 
APB wants it adopted when 
those companies being audited 
already comply with the Cad- 
bury Code - under which 
directors are already urged to 
make a statement of going con- 
cern. 

What the APB has done for 
auditors, the Working Group 
on Going Concern has done for 
company directors of listed 
companies - including those 
quoted on the USM. It has pub- 
lished this week guidance on 
making an explicit statement 
of goirg concern. 

As its guidance is a codifica- 
tion of best practice with 
which it believes companies 
with year ends from December 
1994 can comply. The guide- 
lines give directors three 
options: 

• To state that the company 
is a going concern. 

• To state it is a going con 
cem but with an explanation 
of potential problems and bow 
they would be dealt with. 

• To state that the business is 
not a going concern. 

Needless to say the final 
option is going to be rare. The 
second wUl not be as rare and 
will need very careful handling 
if it is not going to inflict 
severe damage on the share 
price. 

In the case, for example, of 
an incomplete negotiation of a 
contract, analysts and the 


press would need to be care- 
fully briefed. 

Advice to directors on the 
definition of "foreseeable 
future" has again been dove- 
tailed with the APB's rules for 
auditors. Generally they 
should look at all the relevant 
information available - includ- 
ing the long-term view. The 
expiry of a patent, for example, 
in 15 years' time is not an irrel- 
evant item for consideration. 

One can see some potential 
problems when the new rules 
are up and running. Imagine a 
group of directors putting for- 
ward their judgment that the 
company is a going concern 
based upon a forthcoming 
bank loan. The auditor may 
discover, after questioning the 
directors, that the loan is only 
to be forthcoming if the com- 
pany is judged a going con- 
cern This kind of situation 
will require a common sense 
solution. One could imagine a 
tripartite meeting between the 
parties involved as a good 
start. 

Finally the APB also pub- 
lished this week a revised bul- 
letin on corporate governance 
which said that it was imprac- 
tical for auditors to give an 
opinion on the director’s report 
on going concern. This was 
seen as involving too much 
extra work. 

However, if the director’s 
report is inconsistent with 
what the auditor knows from 
having to sign off the accounts 


then they should hi g hli g ht the 
difference. 

Taken together this week’s 
publications certainly appear 
to increase the responsibilities 
of auditors and directors. By 
clearly setting out their duties 
and roles the APB and the 
working group have put in 
place a strong framework. 
There may be some fears that 
as a result the liability of audi- 
tors has been increased. 

This is certainly a danger. 
But the allocation of responsi- 
bility between the parties has 
also made it clear that auditors 
have to work with information 
provided by directors. The 
rules now also make it explicit 
that the going concern judg- 
ment is not a guarantee of 
future prosperity. 

If auditors can educate the 
public on this definition of 
going concern it win go a long 
way' to closing the expectation 
gap and protecting them from 
blame when companies fail 
The need for more open discus- 
sion and analysis in financial 
statements of going concern 
should also benefit the public 
interest 

For most company directors 
the new rules will not be a 
burden. But the guidelines 
undoubtedly focus their 
responsibilities in a way which 
is difficult to avoid. There will 
be those who do not wish to 
take a more rigorous approach 
to what has up until now been 
seen as a bland assumption. 


Group Financial 
Manager 

Milford Haven Port Authority is one of the UK’s mqjor 
ports with an annual throughput of 30 million tonnes and . 

turnover of £10 million. 

The Port requires a Group Financial Manager who will be: , j 

• A fully qualified, computer literate accountant with Sub-T^ 

siantiai business experience. 

• Able to act as the Board's financial advfccr. 

• Experienced in treasury management. 

• Able to act as Secretary of the Authority’s subsidiary coo^ 

ponies. 

Salary is in the region of £35,000-£40,000 + a nob-contribu- 
tory pension scheme. A car is provided. -■ 

CVs should be sent by I December 1994 nr. 

General Manager, Milford Haven Port Authority, ; 
P.O. Box 14, Milford Haven, Dyfed SA73 3ER. 


GROUP ACCOUNTANT 

A North East based Agricultural Mcnrhanting Business 
requires a qualified Accountant to take responsibility 
for this £ 1 5m turnover business comprising three operating 
subsidiaries. 

Responsibilities will include the preparation and presen- 
tation to the Board of monthly management accounts and 
forecasts, plus preparation of statutory accounts; 
Applicants must be ACAV with a minimum of 5 years post 
qualification experience gained in a senior cole .wilhin 

commerce or industry. A ^. 

This is a key appointment as the Senior Financial Officer, 
within a small management team, in a rapidly expanding 
business. The candidate will report directly to the Group 
Managing Director. 

Salary: Circa £27,500 

Please apply in writing enclosing a fall CV to our advisers:- - 
James Judd, Walter Judd Limited 
64 Queen Street. London F.C4R IAJ ; 




v;,v f 


:£jy 


<P CLYDE PETROLEUM pic 

Financial Controller 


r.-.T 


Herefordshire 



• Clyde Petroleum pic is a fully listed British 
independent exploration and production company, 
ivirh interests predominantly in the UK' and The 
Netherlands and a current turnover in excess ol £/0Qm. 

* Based at the company s headquarters in 
Herefordshire, and reporting to die Finance Director, 
a Financial Controller is required who will assume full 
responsibility (or internal controls and the production 
o( timely and accurate management and statutory 
accounts together with variance analyses and cash 
flow forecasts in order to monitor effectively the 
performance of the business. 


C.&45JOOO + Car 

with Slock Exchange requirements. Expenence 
of working wilhin an international organisation 
and knowledge oi foreign currency transactions 
would be advantageous. 

■ The importance oi this role is reflected in the 
requirement for considerable communication skills to 
liaise with senior management and joint venture partners. 
The successful candidate will need to demonstrate a 
proven track record of staff management and be able to 
work in a dose-knit and informal environment. 

■ A relocation package will be available if appropriate. 


■ Candidates should be aged over 32, and be 
qualified accountants who have ideally gained 
substantial financial management experience within 
the upstream oil sector. Alternatively, candidates 
could come from wilhin a non-related business but 
must have strong technical management and financial 
accounting experience to PIC standards and be familiar 


" Please write enclosing a curriculum vitae including current 
remuneration and quoting reference CAS8S to Carrie Andrews 
at Ernst A Young Corporate Resources, Rolls House, 7 Rolls 
Buildings, Fetter Lane, London EC4A 1NH. 

Ml E rnst &Younc 


Coopers 

&Lybrand 


Executive 

Resourcing 





'■'j£ 


y 




k»t.- wi. it-. 


The Ciba Group of companies in the United Kingdom have their 
attractive Headquarters on the outskirts of Macclesfield. This 
Swiss-owned Group Is one of Britain's major manufacturers and 
distributors of products hi the fields ol heatiheare, agriculture 
and industry, with a UK turnover of around £750m and 
employing some 4.800 people of business unit sites from 
Paisley and Grimsby In foe North and East, to Horsham and 
Southampton to foe South. Operations are very decentralised. 

Reporting to foe Chairman and Chief Executive, a major task 
of your smoH team Is to reassure senior management foot 
proper management controls and systems are in place and 
operating efficiently. Equally Important, you will provide a 
consulting service that win support business units by 
ktenftfytng and recoram ending best practice and by carrying 
out specific projects. You will also be expected to participate In 
International Ciba audit teams. 


Probably a graduate accountant, you will preferably have 
managed an Internal audit group within a major international 
business. Experienced, perceptive and commercially aware, 
you must possess a practical knowledge of modem control 
procedures and review techniques as well as well-developed 
communication and ofoer Inter-personal stalls. This Is a high 
profile role that should provide a springboard to a wide range 
of senior financial positions within foe organisation. 

An excellent benefits package is available. Including relocation 
it required. 

Please send full personal and career details, including current 
remuneration and daytime telephone number, in confidence to 
Peter Jones, Coopers & Lybrand Executive Resourcing Lid, 
Abacus Court, 6 Mlnshull Street, Manchester Ml 3 ED, quoting 
reference P288 on both envelope and letter. 




FINANCIAL MANAGEMENT SEARCH & SELECTION 


PROJECT FINANCE MANAGER 

EUROPE : ; •: 

TO £50,000 + MNEFTI3+-BONUS. 

An international merchant bank with an extensive European - 
network seeks to strengthen its easting high-profile prefect 
finance team. The rolewitt involve, leading projects primarily 
related to the energy and utilities industries across Europe 
Probably aged 27 to 35 .you wiB experience of-., 
managing projects in an indusby'or banking related 
environment In addition you will have at least a woridngr - 
knowledge of a second Euxripeui- fai^jitage-tfHeferably 
Italian, German or French). # •professtopal qualification- is' , 
preferr ed , but not a prerequisite. Ref: 135690 


CORPORATE FINANCE EXECUTIVES 

CITY 

TO £38,000 + BENEFITS + BONUS 

OiirdieRtisA'Jes&^g^otHl investment banking group with an 
extensive international network of offices and an enviable 
reputation. -- . .1 

The European Corporate fihance Division requires exceptional 
newtyquafifietf chartered aooountani&Io work on cross border 
transactions both in. the UK and Gontinental-Europe. 

Gients wiU indude both multinational corporations and 
large/ medium -sized private companies. You will have 
trained within, a. 'B^S' accounfency firm, have an excellent 
academic background and first time passes. Ret 34879 


For a confidential discussion please call Nome Sinclair on 071-405 4161 (fax- 071-430 1140) or 
evenings 071-454 9151 or write to him at IMS, Recruitment Consultants, 5 Bream's Buildings, 
Chancery Lane, London, EC4A IDY. 

A MEMBER OF THE PSD GROUP 


HEAD OF CENTRAL INTERNAL AUDIT 


NEW ROLE IN HIGH PROFILE INTERNATIONAL GROUP 
WEST LONDON TO £60,000 + SUBSTANTIAL BONUS POTENTIAL + BENEFITS 


• International, household name consumer products 
and services group. Turnover exceeding £4bn from 
some 40 councries. Highly decentralised management 
structure including internal audit teams at product 
group level 

• New position heading a small central team, 
providing independent support to the Group Finance 
Director and Main Board Audit Committee. A centre of 
functional excellence with a brief to improve the 
effectiveness of financial controls and play a lead role 
in establishing best internal audit practice throughout 
the group. 

m Responsibilities will include ta r gettiq g and carrying 
out independent audits of individual businesses on a 
surprise basis, with the agreement of senior divisional 
management, and following up recommendations 


made by product group internal auditors to ensure tfaar 
they are implemented quickly and effectively. 

• G r a duat e charter ed Accountant who combines . 
technical excellence with a particularly high degree of 
diplomacy and persuasiveness. Must have wen 
developed presentation skills in order to command 
respect and sell ideas at the highest level within 
product groups. Resilience and self motivation will be 
i mp o r t an t personal qualities. 

• Candidates wfll be “Big <S’ firm trained and wfll 
either be currently in the profession as senior 
managers or will have achieved success at a senior 
level in the internal audit functions of large corporates. 

• This demanding position will offer exposure across 

the ni ganterin n and is llhriy fn lead to promotion nnt 

of audit Into one of die businesses in the medium term. 


IVase apply in writing quoting reference 816 
wiih full career and salary details to: 
Nigel Banes 

Whitehead Sdrcraxi Limited 
45 Wdbcck Street London W1M 7HF 
Ttt 07 1637 8736 






v&mzti m. 





Toiiche 

Ross 


£ 


M4 Corridor 

This new appoint morn presents an exciting opportunity 
Vo join a rapidly growing organisation whose main 
business is short verm computer and video conferencing 
rentals. The company enjoys a premier position in 
various markets and has ambitious expansion plans which 
will be met by organic growth, particularly into Europe, 
as well as by acquisition . 

A Finance Director is required who, as a member of 
the management team, will actively drive the growth 
of the business. As well as managing the day to day 
finance function, the Finance Director will be 
responsible for identifying, assessing and negotiating 
potential acquisitions and will also take a (cad in their 
Integration. 



To £50,000 + bonus + car 

With significant experience of leading the 
acquisition process, you will be a chartered accountant 
with superior financial management skills gained in a 
pic. Experience of a distribution environment and 
familiarity with European financial practices are 
also important. A handy on approach, considerable 
business acumen and die stature to represent 
the company at the most senior level are all 
important attributes. 

Please send a comprehensive CV, stating your current 
remuneration package and quoting reference 3423 
to Frances A. Bell, Touche Ross 
Executive Selection, Friary Court, 65 
Crutchcd Friars, London EC3N 2NP. 

Management Consultants 



# - 



A WORLD-BEATING BUSINESS WITHIN A WORLD-BEATING BUSINESS 

Finance Manager 

Heathrow Sc Gatwick. Operations 


With annual revenues in eras of j£50u million and around 3.000 -naff ; 
British Airways World Cargo is a significant business in its own right. With 
a mission to transform the air transport business, we are entering a period 
of continuing development; tangible evidence of which is a £150 million 
investment in a state-of-the-art cargo fondling facility at Heathrow. 

To support this development, a new Finance Manager position has 
been created. Reporting to the Financial Controller - World Cargo, 
you will use die latest costing and evaluation techniques to assist man- 
agement in the ongoing development of a productive, cost effective 
international operation. Your management style will be both consulta- 
tive, involving the workforce in delivering solutions to business users; 
as well as being capable ol reaching rough business decisions through 
sound analysts and highly developed influencing skills. 


Leading a small team ofbusines, analyse, you will be a graduate prob- 
aWy with CIMA qualifications and experience of a niamuis handling. 
JIT environment. Intellectually sound with a mental and physical 
resilience to cope with both a radically changing business environment 
and a 24 hour, 365 day a year business, you will also need to combine 
hands-on business acumen with outstanding technical ability. Succeed, 
and the opportunities for personal and career development arc. without 
doubt, outstanding. 

To apply, please write or Eu with foil CV and current remunera- 
tion details to our consultant Alan Birch. Macmillan Davies, Salisbury 
House. Bluecoats. Hertford. Herts SC 14 1PU. Quoting reference; 
MD3958. Fax: 0092 505301. 

Clasiiq; dote for upplioiibta is I8tli /Vixemfer 1994. 


AtfcwSs WORLD CARGO 













FINANCIAL TIMES FRIDAY NOVEMBER II 1994 


VU 


Director of Finance 


Cornwall Healthcare NHS Trust 


c.£45,0QQ + Bonus + Car 


St Austell 


Demanding and rewarding challenge to lead customer focused finance 
function and contribute to corporate management of the Trust. 


THE TRUST 

♦ Provides comprehensive range of community based 

services, including specialist mental health and care of 
me elderly, across the whole of Cornwall. 

^ Scrvi f es P rov 'ded through a devolved general 
management structure. 

♦ Over 4000 employees. Revenue budget £6Um. 

the position 

♦ Overall financial leadership. Reporr to the Chief 

Executive. 

♦ Ensure tight management and control of the finance 
function. Contribute to corporate policy and strategy. 


♦ Provide support and assistance to Executive Board 
Directors and General Managers. 

QUALIFICATIONS 

♦ Qualified accountant with extensive experience of 
formulating and implcmcndng financial strategy in a 
complex organisation. 

♦ Strong leader, excellent analytical ability and first doss 
communication skills. 

♦ Ideally, knowledge of NHS financial systems. 


Please send full cv, stating salary, ref PN448I, to NBS, 54 Jermyn Street, London SWI Y 6 LX 




N B SEJ-ECTION LTD 
t B.VB Rc.ixir.xs pte cnmfian)' 


B-S 


LONDON 071 493 *192 
Aberdeen 0324 f.JKORQ • Birniin^him 021 233 4fcS*i 
flrisi.4 02?2 2**1 142 * EJmliur]-h 0.1 1 220 2400 
C.Us,;,nv 041 204 41 W • I.l-ciU 0552 453810 
M JiKhnier 0i>25 5!‘i**51 • Slouch Q753 SIW2? 


Financial Controller 

Leisure Division of Major Organisation 


c.£3 5,000 + Car + Benefits 


North West 


Key role in management of change within major division of profitable group. 


THE COMPANY 

♦ Leisure division of significant UK group. Household 
name. Profitable. 

♦ Committed to expand into new market sectors, 
retaining emphasis on current strengths. 

♦ Reputation for quality of employment and 
opportunities for personal development. 

THE POSITION 

♦ Focus on overall financial control of business. 
Contribute to finance and IT strategy. 

♦ Ensure efficient and rimdy production of management 
information, manage external relationships and liaise 
with Group Treasury- Rcpon to Finance Director. 


♦ Manage and motivate large team of people during 
time of change and devdopmem. 

QUALIFICATIONS 

Qualified accountant, blue chip experience, seeking 
increased responsibility. Strong awareness of up to 
date accounting systems and procedures. 

♦ Committed professional, strong interpersonal and 
communication skills; resolute and persuasive 
management style, able to gain respect at all levels. 

+ Bright, personable and cheerful team player. 


Please send lull cv, stating salary, ref YN4369, to NBS, Prospect House, 32 Sovereign Street, Leeds LSI 4BJ 






N B SELECTION LTD 
j BNB Resources pic company 


N-B-S 


LEEDS 0532 453H3C 

Aberdeen 3224 olSQSO • BimunuHam 021 233 

Bristol 0272291 142 • Edinburgh Oil 22024CO 
Glasgow 041 204 4334 - London 07) 493 6392 
Manchester C625 539951 • Saudi C~33 i!922r 


DIRECTOR OF FINANCE 


Buckinghamshire 


£50K package 


Amersham & Wycombe College is an independent further 
education Corporation with 8,500 students and 350 staff 
located across three main campuses in south 
Buckinghamshire. The College has been highly successful In 
diversifying Its markets and the annual turnover is £l2m 
having tripled over the past four years. A significant area of 
growth has been in the provision of contract education and 
training services for major customers including the Prisons 
Service and local TECs. Some of this activity is undertaken 
through the College's subsidiary trading company of which the 
Director of finance is the Company Secretary. 

The Director reports to the Chief Executive, provides reports 
for the Board of the Corporation, the Finance Committee and 
the Audit Committee and regularly attends the meetings of 
these three committees. Following a recent reorganisation, 
the Director is now responsible for the College's MIS which 
adds a significant dimension to the breadth of responsibilities 
of the post The Corporation is seeking to appoint someone 
who can build upon and develop the excellent financial base 
which has been established since the College left the 
control of the County Council in April 1993. 

Applicants must have a recognised accountancy qualification, 
(eg ACA, ACCA, C1MA etc) together with a range of experience 
some of which must have been gained in the private sector 
preferably within large organisations. The ability to manage 
-the development and implementation of new computer based 
systems is an important feature of the post -The College is 
pursuing delegated budgetary control which requires non* 
financial managers to manage their buckets and the Director 
Is required to provide leadership and support for this cutture 
change. The Director must have a good knowledge of tax 
matters Inclucflng VAT and covenant payments. The Director 
has a team of 27 staff, 4 of whom are direct reports including 
a personal secretary. 

Ideally In the age range 3040 and seeking a significant career 
advancement, the Director of Finance will play a major part in 
the further development of the College and In ensuring its 
sound financial fijture. 

If you are interested in this challenging post, 
please send a brief letter of application together with 
a full CV to Tricla Leman, Director of Personnel, 

Amersham & Wycombe College, Stanley Hill. 

Amersham, Bucks HP7 9HN. 

The dosing date for expressions of interest is 
Friday 25 November 1994. 


V 


J 


High Profile Financial Planning 


London 


Our client is a leading UK pic whose billion operations arc well-established in 50 countries 
worldwide. The activities of the Group arc diverse and include consumer products and service as 
well as related and supporting areas of activity. The Group is well-placed to grow and develop 


further. As part of these development plans, the need Ibr a strong and high profile Group Financial 
PEanning function within the Head Office has been lAmHiw-H As a result two unique opportunities to 
actively participate in exciting commercial decisions have now adsen: 


Group Financial Planning Manager 

£50.000 plus Bonus, Options & Car 

Reporting to the Group Financial Controller and managin g a professional team, the responsibilities 
will indude; 

• Key monthly reporting on operating and financial performance. 

• Provision of all aspects of short medium and long-term planning as well as ongoing performance 
review of the business. 

• Collection and analysis of key (financial and non- financial) information required to run 
the business. 

• Developing a financial support and advisory function for Group and Divisional Senior Executives. 

To perform this role you will be a Qualified Accountant with a strong track record of direct and pro- 
active contribution to business via financial pl anning and analysis. Vou will have experience at 
Group and ideally, at operational level; almost certainly within a blue-chip environment . Previous 
fineg or related experience is ideal but notessentlaL Reference number WKW/6 103/FT. 


Group Financial Analyst 

Up to £40,000 plus Bonus, Options & Car 

A senior member of the team reporting to the Group P lanning Manager. Responsibilities will 
include: 

• Frill involvement in the monthly reporting activity as weD as the forecasting, budgeting and long- 
term planning processes. 

• Production of performance measures, profitability analysis and risk assessment 

• Supporting the Group Financial Planning Manager in a wide variety of ad hoc projects. 

Also a Qualified Accountant you will have a strong financial planning and analysis background 
within a large blue-chip organisation either within industry or the banking sector. 

Strong interpersonal and relationship building skills as well as the ability to communicate credibly 
at all levels are essential to both rote* A0 candidates should be commercially and 
operationally orientated with the ability to take on a more strategic and wide 
perspective. Reference number: WKW/6100/FT 


To discuss either of these positions further you should write to Karen Wilson at Hoggett Bowers, George V Place, 4 Thames Avenue, 
Windsor; Berkshire SL4 iQP, 0753-850 85 r. fax: 0753-853 339. enclosin g a recent CV and a note of cunent salary, quoting the 
ap p ro p riate reference number. 





Bowers 

HH EXECUTIVE SEARCH AND SELECTION 


r 


COMMERCIAL FINANCE DIRECTOR 


Commercial ACA, (mid 3pe), FWaB/Service Industry background. FD of 
both smaB (£2m) and large (£300m) companies seeks contract work in 
the London or Thanes VhBey areas. Strengths include: 

O System design, development and implementation 

□ Staff motivation and management 

□ Bfldency programme management 

□ Problem solving 

For further details ring or fax: 0734 341567 


BUSINESS ANALYST 


Key appointment in major Blue Chip Company 


CENTRAL 

LONDON 


to £38,000 

+ Car 
+ Benefits 


An outstanding opportunity has arisen for an ambitious and highly commercial finance professional to join one of Britain's leading companies. With an 
annual turnover in excess of £ 1 0 billion and operations throughout the world, the company is well placed to meet the global challenges of the future. 

Working as part of a small, highly visible team, and liaising closely with corporate and operational senior management, your brief will be to provide detailed 
analytical information on financial planning, reporting and control issues. Specifically your time will be spent on preparation of Group budgets, five year 
plans. Group management accounts and ad hoc projects of major strategic importance. 

The successful candidate will therefore require the following key attributes: 

— p- Qualified graduate ACA with 1- 4 years P.O E gamed either within a top six firm or industry, 
w Strong analytical skills combined with exposure to ad hoc project work and group consolidations, 
w Intellectually robust with outstanding inter-personal skills, 
w Ability to make an impact in a fast-moving change oriented culture. 

We are interested in talking to candidates who can display records of consistently high achievement and who are comfortable working alongside senior 
decision makers. Energy, creativity and flexibility are all qualities which will enable you to take advantage of career opportunities within the company either 
in the U.K. or overseas. 


Interested applicants should write in confidence, stating current remuneration, to Andrew Livesey. quoting reference 
number 2099. at Nicholson International. (Search and Selection Consultants] Bracion House. 34-36 High Holborn. 
London, WC1V 6AS. Alternatively fax your details on 071 404 8128. Our client is an equal opportunities employer. 




France 


Italy 


Holland Spain Germany Belgium 


Turkey 


Poland Czech Republic 


m 


Hungary 


Nicholson 

International 


Romania 


Russia 


UK— 

Australia 


J 



From computer 
audit/consultancy 
to a major 
international group 


rr audit 

MANAGER 

London 

c£45,000 + car 


Our client, Pearson pic, is the parent company of a 
worldwide media group whose principal operations 
are in the fields of book and newspaper publishing, 
entertainment, television and investment banking. 
The group will continue to grow both organically and 
through acquisition, which may be international. 

The IT Audit Manager will work as a member of a 
small professional team responsible for the audit of 
the group’s activities outside North America. Provid- 
ing constructive and commercial advice on IT, 
financial, operational and business systems and 
controls to both group and subsidiary management, 
he or she will carry out all aspects of assignments. Ad 
hoc projects might include IT strategy studies and 
acquisition reviews. The internal audit function is 
highly regarded and has established a track record of 
promotion to senior line management positions in 
the subsidiaries. 

Applicants should be graduate chartered accountants. 
In depth experience gained in either computer audit 
or systems consultancy is essential and ideally 
should include significant exposure to pc networks 
and mid-range based systems. 

Please write, enclosing a career/salary history and 
daytime telephone number, to David Hogg FCA 
quoting reference H/ 119 /F. 


Manager - 



Accountant 



Pic 


Warwickshire 


-£ 60,000 + 

+ Relocation 


Our client is a recently floated distribution group, with substantial 
Gty support. Following the acquisition of a major competitor, the 
company is ideally positioned to make further inroads into its 
fragmented and competitive marfcel sector. This will primarily be 
facilitated through on aggressive acquisition strategy coupled with a 
well defined sales and marketing formula. The dynamic executive 
team has created an environment that emphasises tight management 
controls and entrepreneurial flair. 

To achieve the ambitious level of growth desired it is essentia] Ur 
recruit an outstanding Manager - Special Projects. This is a key 
appointment where the emphasis will he on contributing significantly 
to the growth and value of the business. The focus will be on 
developing a group wide rationalisation programme and installing 
effective management systems and controls. 

The required candidate will be a task orientated and proactive 
qualified accountant (aged 32-40), with an outstanding record of 
success. Relevant experience will have ideally Ken gained in a multi 
site distribution organisation. A background of implementing systems 
and managing teams in a rapidly changing environment is strongly 
desired. 

The rewards include an attractive basic salary, performance related 
bonus, share options and relocation package if appropriate. Most 
importantly this position provides the opportunity to join an 
ambitious group in its initial stages of growth and to achieve main 
board status within a short period of time. 

Interested applicants should write, in the strictest confidence to 
Robert Walker or Brian Ham ill, forwarding a curriculum vitae to our 
London office quoting RW 1451. 

WALKER HAMILL 


Executive Selection 


103-105 Jermyn Street, 
St James's, 

London SW1Y 6EE 


Tel: 0171 839 4444 
Fax; 0171 839 5857 












VIII 



FINANCIAL TIMES FRIDAY NOVEMBER 11 . 1994 . 


$ Head of Financial Planning \ 

Providing service excellence through technology and people 


Midlands 


Candidates will be 


c. £40,000 + Benefits + Car 

id qualified accountants 
iicd in their late 20s to early 



industry. They operate i 

personal sector market place and their success is based ona 
genuine commitment to quality, together with state-ot-the-art 
technology, ensuring that they fulfil customers' requirements 
and expectations. 

Reporting to their Finance Director, this new position will 
provide a focal point for strategic business planning issues 
within this young and dynamic organisation. 

Key tasks will include: 

• helping to develop and implement their financial business 
plans; 

• devising and delivering a comprehensive MIS network 
which is able to cope with a rapidly expanding customer 
base; 

• working proactively with internal management to provide 
an expert financial modelling service 
which meets their evolving requirements 
and aids commercial performance; 

• acting as a catalyst to promote new 
financial initiatives throughout the 
operation. 



i ideally l . _ 

retail or service sector environment. Previous exposure to 
evaluating and selecting IT systems would bean 
advantage. 

Energy, enthusiasm and first rate inter-personal skills are 
vital. You must bo able to demonstrate a capacity for 
forward thinking and the ability to manage change 
effectively. 

This is an exciting opportunity to join a customer focused 
company, whose growth potential is almost limitless. They 
have the brand name and full support of one of the 
world's largest financial institutions. For the right 
individual this position will represent an irresistible 
opportunity to gain further career development 

Please send a full CV in confidence to 
GKRS at the address below, quoting 
reference number 123B on both letter and 
envelope, and including details of current 
remuneration. 


SEARCH & SELECTION 

I Waterloo Street, Birmingham B2 5PG. Tel: 021 633 4844. Fax: 021 633 3"4-» 


Finance Director 

Specialised Manufactured Products, 



North West 

This is an editing opportunity to join a well 
established business operating in a range of 
international markets, which is a strategically 
important part ot a quoted engineering pic 

The position will form part of a dynamic management 
team which is committed to the growth and evolution 
of this multi-sited operation. The roie will be located in 
their business unit in the North West 

Kev tasks will include: 

• implementing strong financial controls; 

• embracing an environment of change; 

• making a significant contribution to the business; 
selecting and installing a fully integrated 


nu n u tac tu ring / H na ncia i 
information svstem. 


Candidates will be qualified 
accountants, preferably with a degree. 



c. £40,000 + Bonus 4- Car 

who have a proven background operating at a 
senior level within a manufacturing environment 
A thorough understanding of financial modelling 
techniques and PC sy s te ms is essential- 

Excellent personal presence, drive and good 
analytical skills are important requrrements- The' 
successful candidate will enjoy initialing donees, ' - 
adopting a hands-on management style, and 
interfacing with all aspects of (hie company's ' 
operations. 

This is a growing organisation which can offer first- 
class prospects for career development, including _ 
the possibility of a move into generalmanagement 

Please send a full CV in confidence to GKRS at the . 
, address below, quoting reference 
- j number 125B on both letter and 
envelope, and including details of 


£jjj current remuneration. 



SEARCH & SELECTION 

S Vi ATTsu m Stksft, Birmingham B2 5PG. Tel: 021 633 4844. Fax: 021 633 3744 

A GKR Group Company 


Group Finance Director 


Pic main board appointment 


Yorkshire 


An innovative and ambitious market leader, our client has a 
growing international reputation in its specialist field of 
business services. As a direct result of continued growth 
and plans for further development of worldwide 
operations, there is an immediate requirement tu appoint a 
Croup Finance Director to the main board. 

Reporting to the Group Managing Director, the successful 
candidate will take responsibility for all finance and 
corporate reporting matters For the group and its subsidiary 

■ companies. As a member of the Top Team', the person 

■ appointed will also be expected to make a significant 

■ contribution to the future strategy and direction of the 
I business. 


Key tasks will be to: 

define financial reporting requirements for subsidiary 
companies and provide appropriate management 
information to tne senior management team to aid 
decision making; 


i to aid future 


manage ail aspects of treasury, cash 
management and company secretarial 
issues; 



c. £65,000 + Executive Benefits 

• handle external relationships with investors, bankers, 
institutions and auditors. 

Candidates, aged 30-43. should be graduates with a 
chartered accountancy qualification and possess 
experience with an industrial or service sector company. A 
background in a public company, as a Divisional Finance 
Director or in a central role as Financial Controller, would 
be a definite advantage. The ability to operate effectively in 
a customer-focused and nurket-ied business environment 
is essential. The person appointed should be able to 
demonstrate first class communication skills and a high 
level of commercial awareness, combined with the ability 
to influence and negotiate at all levels. 

The remuneration package reflects (he importance of this 
critical appointment and will include a company car. a first 
class group pension and executive share option scheme. 
Please send a full CV in confidence to GKRS at the address 
below, quoting reference number 94373 N 
on both letter and envelope, and including 
details of current remuneration. 


SEARCH & SELECTION 

park House, 6 kjlungbeck drive, York road. Leeds lsi4 6UF TEL: 0532 484848. 

A GKR Group Company 



Coca-Cola 



CHIEF FINANCIAL OFFICER 


Executive Package and Expatriate Benefits 


> Prague 







gv Growing to excelle nce - . ■. 


Procter & Gamble, with home offices in Cincinnati, Ohio (UJS. I, is one of the world's leading consumer goods manufacturers with over 250 different 
brand and product variations which are sold in over 150 countries and with approximately 97.000 employees around the world. Strong business growth 
in Europe, as well as increasing complexity and challenges in our operations, have created opportunities for extra tm/f) 

European Tax Manag ers 

As members of the European Tax Group and located either at the European Headquarters near Brussels or in one of our major European operating 
companies (e.g. in The United Kingdom. Germany, Italy. Spain, France, Switzerland), the successful applicants will be expected to : 

• Provide tax advice and support to the European operating companies' management • Establish clear, consistent and sustainable tax strategies for all 
facets of the business. * Assist in cross-border and local corporate tax planning, as well as compliance for the local corporate entities. 

Proven technical ability, strong communication skills, business orientation with an ability to put tax planning in its context, and the desire and potential 
to contribute effectively to the overall management of the business are essential pre-requisites. Experience in international tax or in numaging or 

advising Belgian Coordination Centers would be an advantage. 

The above assignments would ideally suit a qualified University Graduate who has gained 3 to 5 years of corporate tax experience within an industrial 
environment or a professional office. Prospects for the successful applicants include the possibility of senior tax roles in operating companies, in the 

European Headquarters or in the International Divisions. 

Interested applicants should contact either by phone or by letter MrJ. Hermans or Mr W. De Paepe. Recruiting Office. 

Procter&Gamble 

Europe 

Temselaan 100 - 1853 Strombeek-Bever - Belgium - Tel 32/2/456 21 II 


Development/Venture Capital - Major European Player 

Fund Accounting & Reporting 

Ideally Mid/Late 30s flex c£40/45,000 + Bonus + Car Central London 




Our Clrant Is a recognised leader In the European Management Buy- 
Out/Venture Capital arena and. as an independent player, operates through 
six offices across the Continent It currently marapes equity Investments in 
over 70 European businesses and, since inception in the early 1980s, has 
been involved in over 150 investments, with s\ agfliegSe value of several 
billion pounds; which have included same of the largest MBG/MBI 
transactions conducted. 

Major powtfi and expansion plans, involving the raising of new equity 
funds to be under its management, has created the need fora Find 
Accounting and Reporting Manager to join its small overall learn of 
toves&nent professionals and administrative support stffl o! some 30 people. 

In this new appointment you will report to the Group finance aid 
Administration Director. Your main involvement will primarily locus upon 
accounting, external Investor reporting, and administrative activities 
required lor the hew funds under management hi particular, you will be 


responsible for the prqparSion ol reports Lo Investors, investor capital 
accounts, statutory accounts, funding co-ordination aid liaison with third- 
party fund admtaistnaors, AdditionaUy. you will act as a briber central 
overall resource within the Group Finaice and Administration Director's 
team. 

Ideally, you will be a qualified accountan, with previous experience ol 
fund management accounting/ reporting, which could have been gained 
elBier within an appropriate financial institution or. alternatively, Irom 
relevant client exposure within the accountancy profession You must tm 
PC literate, a team player with a high level of sell-mativalion. pragmatic 
and llex&le in attitude, with a 'shirtsfeevesT approach. 

Yob sb owH write enthariag a reswree together wftt current 
rrmin ulloo Mails and rtaytiare/evmiBg telephone contact 

■nnliers, qnHog BaforaaBB 411/B oo both OBralope ami letter, 
tatteiMMiuJiuliuliw. 




Ctnyssaptas Fla iron iger Associates, Bechtel House, 245 HammaismHfi Read. Lnodou WG 8DP. 


mU^JECTQS. 

The FT can help yon reach additional business readers in France. Our link with the French business newspaper, 

Les Echos, gives you a unique recruitment advertising opportunity to capitalise on the FTs European readership and to further target the French business world. 
For information on rales and further derails please telephone: PtuFp Wrigley on +44 71 873 3351 



3i is the leading specialist investor in unquoted businesses in the 
UK. We provide eqmtjy a n d loan capital to supp ort amafl and medium 
sized businesses in all sect or s of the economy, anfmim pn g wealth 
creation and business growth. We have recently achieved a listing tm 
the London Stock Ex c hang e and become a member of the FT-SE 100. 

As one of the country’s foremost lending investors in independent 
business, we naturally adopt progressive strut pni fuMii mal practices - 
particularly when monitoring our own operations. 

We are now looking for a conscientious and effective Internal 
Auditor to join our Audit team in Waterloo, to provide support on 
firm rural and operational procesaag tn wi«nn» wo nwt H»gniv«^ 
standards and statutory regulations. A certain amounted' travel will 
be involved. 

You wffl be a Chartered Accountant with np to 2 years’ post 
qualification experience. Knowledge of the finanrial services sector 
would be an advantage, as would a working knowledge of French or 
German. It is essential that you are computer-literate. You win also 
possess a high level of inter-personal and organisational skins, and 
have the ability to deal with sensitive matters in a confident and 
professional manner. 

In addition to a competitive salary the package includes a. 
company car and financial sector benefits. 

If you are interested in applying, please forward your CV and a 
covering letter to Miss Ginny Kelly, Human Resources Department, 

3i pic. Trinity Park, Bickanhfll, Birmingham B37 7ES. 




Amatil 


Coca-Cola Amatil, is a global leader in the manufacture, marketing and distribution of a portfolio of pronier branded 
carbonated soft drinks, mineral waters and other non alcoholic beverages. The Company’s position has been further 
strengthened bv an agressive and successful expansion programme across Central and Eastern Europe typified by 
outstanding increases in sales, performance and profitability in the Czech Republic. 

The success of Coca-Cola Amatil Czech Republic, the local franchise holder for Coca-Cola branded products, is 
underpinned by substantia! investment in new tnarriTfaemring and distribution farfljrii-gj creative marketing and 
forward thinking management. Further growth is anticipated and the selection of anewOnefHnandal Officer is seen as 
a key appointment for the business. 

Reporting to the General Manages; the position will assume executive responsibility for directing the company^ 
commercial strategies and growth o rient ared investment programs as well as overseeing 60 staff in Finance, 
Administration and Information Systems functions. As part of the Executive Management team in the Czech Republic 
the CFO will also be a key participant in the management of the Global business, 

A Qualified A1BA Accountant, the successful candidate wiQ dememstrate a proven track record in an 
international business environment, ideally Eastern Europe, where yon will have developed strong 

fcflrirrshlp anti management ski Ik and a strategic approach. A connection with the Czech Rqmblic will 
be a distinct advantage. It is expected that you will have fully-developed Czech language skills. 

Interested candidates should contact our advising consultant Kean August, in strictest confidence, at 
FSS Europe, Charlotte House, 14 Windmill Street, London W1P 2DY, UK. ltd No: (44) 71 F S S 
209 1000 (days) or (44) 71 385 3886 (eves) Fax No: (44) 71 209 00QL Europe 


Financial Controller 

(Europe/Middle East/Afiica) 

Chemicals Sector 
Based Brussels 

The 5K Group of Companies is one of Japarfs leading intemuflumi ehemfcab producers wflh current 
revenues of USSlbn. fts Europe/Midde EostMlnoa business com prises dwraad and agrochemical Interests 
and is growing rapidly through foe introduction of new and fanoMOGve products, lb nspand to lha growth, 
parirculaify in continental Europe* ihe company is canting fa European Heodquartm fa Brussels. 

The important role of financial Controller will fcJre ful responsibly for ihe financial management data 
processing, insurance and legal aspects of the Europe/Middle East Mfcca business. This wifl invoke 
providing a fuB range of finarracd/mcHXjgemeitf accounting and related servfom working through a team 
of some 6 qualified and part qudffied staff and fimsfag wflh franco coleagues fa Japan and ihe USA ' 
lb qualify for consideration, candidates must be qualified (Expert CompToble) acco u nta nt s in ihe 
35-45 age range with at least 10 yean commerad/hidustrid accounting experience fa a 
mu!fi-na1ional organisation. Com p e te nt in foreign curency transactions, they will have a detailed 
knowledge of Belgian accounting procedures, US GAAP and ideaBp Japanese reporting systems. 
A high level of computer literacy and fluency in French, English and preferably one other major 
European language is imperative. Experience of the motivation and development of a sroal accounting 
team and the achievement of results through team work is seen as essential 
To nppty for this challenging position please ftrrjoard your C.K in English -wish indication cfc 
salary to: S. Nicholson Associates, 240 Avenue de Thrtmren, Boite 10, 1150 Brussels, Belgium. 

/S/Cbiosciencest 


* 








FINANCIAL TIMES FRIDAY NOVEMBER II 1994 


IX 


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! '! NTvvT^ 


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South East 


to £45,000 + Car + Banking Benefits 


Abbey National is ihc fourth largest financial services group in 
i/ie British blinking sector, with businesses which include life 
assurance and treasury services. 

A career development move has created an attractive 
opportunity for an energetic accouuunr or MBA to take on 
this high profile position which reports 10 the Croup Financial 
Controller. 

Heading a young, professional ream, vour respunsibihiies will 
include balance sheet and margin analysis. Icun loss 
provisioning and the financial evaluation of projects and 
acquisitions. Financial analysis ol the company's monthly 
remits will be an important aspect of the role, together with 
the provision oF financial advice to senior management. 

Intellectually agile, you triJJ have good academic qualt/icaiions 
allied to e.ecepuonaliy strong analytical, managerial and 
communicative skills. A proactive approach is called for, 
together with a positive attitude to change and die confidence 


f ABBEY 
NATIONAL 


to push forward the limits of your own res ponsibi hues. 

Proven experience ol financial analysts and modelling gained 
within a blue-chip company or major accounting practice is 
essential, together with the ability to work equally effectively 
on lioih man.igcii-.tl and hands-on tasks. A background in 
tuntuugnnd knowledge of treasury instnunents would be 
advantageous. 

As a key member of die inniugemcnt team, you will enjoy a 
lull range of benefits including car and mortgage subsidy. To 
support it hethhv work environment, Abbey National has .1 no 
smoking policy. 

Iiitm-sird iipplicuitts should forward diri r Cl's to the Personnel 
Department. Abbey National Pit, Abbey Mouse, Buber Street, 
London NWb OX L. Tel: 071-612 4443 or 071-612 4454. 

In pursuing our policy of equality of opportunity for all. Abbey 
National positively welcomes applications from every section 
of the communin'. 


Financial Director 


West Midlands 

Our elieni is a highly successful and profitable division 
of a well known UK pic, engaged in the construction 
and housebuilding industry. A cumhincd strategy of 
astute fin.ma.il control and market leading product 
quality has enabled rhe company to enhance it's 
market :ui vantage through the 1990's, despite far hum 
favourable trading conditions. Wirh a strong balance 
sheet and minimal gearings, the company is poised for 
further significant growth. 

In order to strengthen its financial and commercial 
expertise, the company is seeking ro appoint an 
ambitious, qualified accountant with strong technical, 
analytical and communication skills. Reporting ro the 
Divisional Managing Director, with a strong doexed- 
line to the Group Financial Omurollcr, responsibility 
will encoiup.iss the overall management of the finance 
department, including all group reporting 
requirements, divisional management accounting, 
budgets, forecasts and systems development. The 
Financial Direcrur will also command significant 
influence across the business in providing 
input ..n all commercial policy decisions, in 


to £40,000 + Car + Bens 

addition to cost management and profit improvement 
initiatives- The position will work closely with 
divisional and Head Office management teams- 
Prospective candidates must be qualified accountants 
(aged 30-45), with experience of managing a sizeable 
finance function. Whilst not essential, experience in 
rhe housebuilding or construction industry would be 
of particular interest. Above all, candidates must be 
able ro demonstrate energy and commitment and the 
intellectual ability to contribute to strategic decision 
making. 

Of equal importance are personal qualities, including 
strong interpersonal and organisational abilities and 
the skills of diplomacy, tact and judgement neccesary 
to operate effectively in n demanding commercial 
environment. 

Interested candidates should apply in writing, 
quoting reference 209513, enclosing a fullCV 
(including a daytime telephone number and details 
of present remuneration) ro William Greenwell at 
Michael Page Finance, The Citadel, 

190 Corporation Street, Birmingham B4 6QD. 


Michael Page Finance 

Sjvi-ulwi m Fuunti.il Rruminuau 
LonJon Bratol Wiuliur Si Atkins LcMbcriiNil Birmingham 
Nottingham Mandusicr Leeds Cbpm Edinburgh & Worldwide 


Promoting Success Through Equality 


dit 


1‘rM FITS 


rhitebead 

iriscTso n 


v 


Financial Director 
— Operations 


West Midlands 

Since its establishment in 1980, uur client has become u 
dominant force in rhe highly competitive retail marker. 
Accelerated organic growth has been achieved through high 
quality service, astute merchandising and competitive 
pricing. Current turnover is in uidcruff^OOm and is 
generated from some 700 stores nationwide. A highly cash- 
generative business, rhe company is committed to a strategy 
of organic and acquisition-led growth to further extend its 
market advantage. 

An opportunity has arisen tor an outstanding finance 
professional to play u significant rule in assisting the 
company to achieve irs objectives. Reporting ro the Group 
. Financial Director, the role will encompass hill functional 
responsibility for a suable finance function, with particular 
.emphasis on syseemsdeveiopmenr. Operating ifl a 
highly cost and margin-sensitive marker-place, the 
position will also be responsible for managing and 


c £35,000 + Car + Bens 

analysing the performance of the business, with rhe key focus 
un tight cost control and overall operational efficiency. 

This is u ‘hands-on* and highly influenrial role anJ will be of 
particular appeal ro ihot*: seeking their fust Financial 
Directorship. Prospective candidates will he qualified 
accountants, able to demonstrate extensive financial 
management expertise in a fost-moving, volume- transact ion 
commercial business. The successful candidate will must 
likely have worked in n multi-site environment and whilst 
not essential, experience In a reraii business would be of 
particular interest. 

Interested candidates should apply in writing, quoting 
reference 209638, enclosing a full CV (including a 
daytime telephone number and details of present 

remuneration) to William Greenwell at Michael 
Page Finance, The Citadel, 190 Corporation 
Street, Birmingham B4 6QD. 


Michael Page Finance 

SipcCblbu m fiTEind.il Rivnnmamt 

London Bratol Windsor St Albans Iralintot Birmingham 
Nottingham Mucholcr Leeds GLugow EJWjiu*h & WorMwidr 







PIA Supervision 

Review Team Member 


The Securities and Investment Dosird’s wide ringing 
reqniroibilitics as lead regulator under ihe Financial Services 
Act include os erseeing the activities of rhe Personal 
Invcscmenr Aurhority - the newly formed main regular. it fur 
the marketing of retail investment products and services to the 
general public. 

SIB has a new supervision depart iriL-m dedicated ro ensuring 
that PIA Jelivers high standards .4 investor protection and 
rcgulnrion. SIB rum wishes ro appoint a member for the review 
team within this department. Reporting to the team manager, 
responsibilities will include: 

■ critical review of regulatory procedure* and activities across 
the breadth of PIA; 

• on-site assessment of PlA's monitoring and enforcement 
activities, including purticipation in visits to member ftrmsr. 

• contribution to the development both of policies and 
procedures fur review and of srandnrds for cost effective 
regulation. 

This review unit complements anJ informs a 
supervise <n unit which .issvsses PIA’% uvanageinvni 
plarw, performance against plans and the aptness and 


adequacy of iu policies and resources for fulfilling its regulatory 
functions. An important part of the job holder's responsibilities 
will concern PlA's monitonng of financial resources, custody of 
client assets and portfolio management. 

Applicants should be or least of graduate calibre, with -.us 
accounting qualification. They should have experience oi'or 
familiarity with some of rhe following areas: 

• audit or consultancy work in the financial services sector; 

■ FSA compliance in retail financial services (whether in the 
industry or in regulation); 

• investigation of financial impropriety; 

• private customer portfolio management. 

An aptitude for critical analysis is essential, as are good 
communication skills, both written and oral, and a mature 
personality with sound judgement. 

Interested applicants should in the first instance contact 
Sue Linrcm at Michael Page City, Page House, • 

39-41 Parker Street. London WC2B 5LH, quoting 
reference 208965. Telephone 07 1 83 1 2000. 

WfB Closing Date 28ch November 1994. 




siipervid. >n unn which .isscues PI A'MivjnagLinent reference 208965. Telephone 07 1 831 2000. 

■ ... plans, performance against plans and the aptness and Wllw Closing Date 28ch November 1994. 

-;':l Michael Page. City Bp 

v ; H lntem.iikin.il Recruiimcnt Consultants 

London Paris Frankfurt Hoag Kong Sydney 


;ctor 


:>m> ' l, ’ ,r 



Chance fur Finanzprofi in intemationaler High-Tech-Qruppe 

Unscr Mandam 1st cine namhafte Internationale Elcktronik-Gruppe, deren Produkte wcltwclt vcrrricbcn werden. Die 
deutsche Verrriebsgesellsichiift itn Rhein- Main-Gcbict envirtse halier mit c:i. 60 Mitarheitcm einen Uiautti von c:i. 

180 Mio. DM. An diesem Stundurt ist nun folgendc Position ncu zu bcscczen: 

Finance Director 


Ajoforderungsprofil: 

• Alter ab ca. 30 Jahrc 

• sehr gute betriebswirtschaftliche Ausbildung 
(Univereitit + Chartered Accountant) 

• mchxjflhrigc Erfohrung in kaufmiUuiischcT 
GesatntvcrantwoTtung 

• flieBcnde Deurschkennrnisse 

• sehr gures fCommimifcnrfonsvormcJgen unJ die 
Blhigkcit, Micirfaeicerzu motivicren 

• un remchmc rische , sclbsciudigc Atbeitswoisc 


Aufeabengebiet: 

• vcrantwortlich for alle Finiinz-/Rechnnngawesen-/ 
Treasury- A ktiviriken 

• Erctcllung von Monnts- und lahroahschliiss.cn n.Kh 
dcutschcm und cnglischem Rccht 

• veraniwurtlich for alle 0-inmdIing-Au%abcn (inlet. 
Budgering, Forecasting, Erscel lung von Abweichungs- 
an.-tlysen sowic Bench tswesen .in das Headquarter in UK) 

• Konuiktptlcgc m Wirtschafoprufcm, Bnnkcn und 
Finanzbehbnlcn 


Die Position ist dem Gcschrtftsfuhrcr dirckc unrerstcllt und hai cine fonkeionale Bcrichtslime nach England. Wir suchen 
in crater Linie Koncakt 2 U Kandidatcn mit cnglischer Muttersprache und einer sehr iiuernationai orient ierten F'erson- 
lichkeic. Wcnn Sic es gewohnt sind, such "hands-on" zu arbeiren, und Sic in diesem dynamise hen (JmfoU die 
Fdttsctzung Ihrcr Entwicklung sc hen, wurden wir Sic yeme kcnncnlemcn. Fur cinen etsten vertraulichen Koiu-akt secht 
ihnen Frau Susanne Schetp untcrTclefon +211 32 44 55 geme zur Vcrfugung. 


Ihre aussagefShigcn Bewcrbungs- 
untcrlagen senden Sic blue unccr 
Angabc dcr Referenz SCH/324 an 
folgcndb Adresse: 


I MUJk 

Michael Page International 

Inicnviitcnal RccruitmcrU Cumulunti. 

London Pxrb Antuenbu Duoddorf FnuJdbit Hon* Kona Sydney 


Michael Page Deutschland GmbH 
Steinstrasse 13. 
40212 Dusscldorf, 
Germany. 




accounts manager 

Competitive Salary Package 
Based London N1 

Ra <> . H S ^ l iving for a qualified Accounts Manager with a background in the RetaiJ/Mail Order 
Sector. Reporting to Financial CootroUer, main duties include:- 

* day to day running of the Accounts department 

* Pre para tion of management accounts 

* assist in setting of budgets 

* half year and full statutory reporting 

* Uaison with c om merc ia l m a n agement 

Suitable candidates should be able to demonstrate relevant experience, good communication and 
interpersonal skills, strong motivation and the ability to work both on their own and os pan of a team 

Morae imte, enclosing CV, to Amende Cains, Personnel & Training Manager, 

P O Box tOQ, Moriey, Leeds, LS27 QXB 


GLOBAL CONSOLIDATION ACCOUNTANT 
Belgium Base. Prepare conwndawd 
(handol accounts. KcowtWge ol US GAAP. 
Micro Control and Spreadsheet Software 
ftapoffa to top management, m wsMiy. To 
567.000 U.S. CV lo Recruiter 15445 
VfertUa Bkd. f3. Bra 186, Sherman Cwka. 
CA 91403. USA. phone Q1B-981-301fl or 
FAX B 16-961-0505 

APPOINTMENTS 

WANTED 

EXPERIENCE, IBWCnT^VEmf »' 
Coaimcirially asiuie financial Lkvwiive 
with inlemaboreil rtperience and 20 
yean baokgrouod in Financial Sen kv^. 
IT and CowsullinB. Lateral thinking 
dutige ftgenL Available io lake nn 
chaHcDging new aswgmwnK 
Boi No. A2I9L Fiaaodjl Time , 

One SeeAtLiik Bridgr. Lualuo se I hill. 

Business Consultant, MBA 

lOyan cjLprricorc io 
Accountancy, 'FHuoci)l Analysis, timipcan 
A E/Enropc experience. SvslcmvTC tile rale 
Seeking FOFD pout km in company Njii ut 
or ■mail growing «-npaiiy (TAJ C N nil. 
Wiling io relooue. 

Ptnc Write Bus. AJI'M 
FioiKMTmet, One Suahvnuk UrnUc 
lAAjnnSH ■*»!- 


Financial Planning 
Manager 


West Midlands 

CXir client is an L’SOm operating division ut‘a major 
Intemarional engineering group. Hw Group operates 
an aftermarket, sales and distribution business lor all 
the Organisation's manufacturing businesses. 

A high calibre individual is s, mghr ro continue the 
development of the financial anJ business systems. 
The scope of rhe role will include: 

• Production of mourhly management accounts, cash 
anil profit lorecasr.s. preparation of annual hudgers 
.Hid three year plan.-. 

• Close liaison with oilier Group businesses Ksth in 
the UK anil Overseas. 

Suitahle candidates for this role will be 


c £30,000 + Car 

highly self- motivated and able to meet chc challenge 
and the demands of a rapidly clianging environment. 
With at least two years post qualification experience 
as a minimum, you will consider yourself a strong 
man -manager, able to motivate a team and to 
operate effectively at all levels within the 
Organisation. Further advancement within the 
Group is likely to he available to the right individual. 

Interested candidates should apply in writing, 
quoting reference 210444, enclosing a full CV 
(including a daytime telephone number and details 
of present remuneration) to Adam Leon at Michael 
Page Finance, The Citadel, 190 Corpora Hon 
Street, Birmingham B4 6QD. 


Michael Page Finance 

Sficvi.iltsi. in Fiibini-ul RnniiiDiiiu 
London Briuol Windsor Si Albniu Lnlhofml Bumtocbim 
Nottingham Mnnchnler Leeds Glasgow Edinburgh & WoftdwUr 


>v . -A - \*V*. 5E : V- 

■■Hi .* 


Xh :'rtl2T5.f C :'Wre # 


COMMERCIAL 

ACCOUNTING 

MANAGER 

East Midlands 
Manufacturing 
Package c£3 0,000 

CRESCENT 

Management Selection ■■■■■ 


A significant UK Division of a major International Group provides 
this ideal opportunity for a commercially orientated Accountant 
seeking career development beyond routine accounting and score 
keeping. Managing a key business function you will find ample 
scope (o utilise in fuff your analytical, business, and negotiating 
skills within a truly European trading environment. Some overseas 
travel will be involved. 

The emphasis of the role will be in support of commercial strategy 
particularly in the areas of product profitability and pricing, and 
business development initiatives. Ideal candidates will be qualified 
Accountants with 3 to 4 years post qualification experience within 
volume manufacturing industry, a sound knowledge of standard 
costing techniques, and the high level of personal drive needed 
for this demanding front fine management position. A negotiable 
package is available to attract candidates of the required calibre. 

Please reply in writing with full details of age, experience, 
qualifications and remuneration, quoting reference number 1101 
to Paul J Slake at Crescent Management Selection, 9 Upper King 
Street, Leicester, LEI GXF. 

I * Leicester • Birmingham 






X 




■ '■■ '-*V. / > ' 

fc-V.-'J'..,..: !iji- r .; "'*■ 

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Financial Services Major - Broad Commercial Role 

Finance Director 


Mid/Late 30s (Ideal) 


Hampshire 


c.£60, 000 + Bonus + Car 




Our Client is a rapidly expanding subsidiary of one of the UK’s foremost 
"quality financial services groups, and recognised as the innovative market 
leader within its particular sector. 

As a result ol the promotion ol its present Finance Director to another 
ley role within 8* overall Group, a highly commercial individual is sough) to 
join the Company's dynamic management team, having the necessary 
qualities to guide the organisation forward through its next stage ol 
anticipated rapid growth. 

As one of three executives reporting to the Managing Director, your 
responsibilities will be wide rang ting and. In addition to the Finaira function, 
through respective managers and a total staffing of around 100, you will also 
be in charge of IT. Legal. Office Services and Business Process 
ImprovemenL Quite apart From ensuring the integrity of business plans, 
systems and controls, you will play a particularly key role in funher 
developing and delivering IT strategy, a vital ingredient in successfully 


You are likely to be a graduate qualified acc * n ,: dni »iih wevious 
"commercial" finance experience A me sharp end whin a comuiU" te^ice 
business, ideally financial services You will t* j warn niayer cat-itte ol 
running your own show wilhm an empowered ma.^gemem envi;onn='« 
with the necessary strong leadership mjr.-mai'.jgemeni ab''.r*es 
communication skills and personal impact in particular you will ne?d '0 be 
highly IT literate, lamilui with developments wttiin rw woiid ot applications 
saltware/hardware. and able lo relate 10 IT protessicnifc 

In addition 10 a lirsi-ciass berteiiis package cu"iorer^r»T.ive reiocanor. 
assistance is available if appropriate Our Client i-, an caual oppodunmes 
employer and is happy lo consider applications (rum registered di'ct-fec 
persons. 

You should write enclosing a resume together with current 
remuneration details and daytime/evening telephone contact 
numbers, quoting Reference 411/A on both envelope and letter, 
to the address below; 


driving the business toward to the address obi ow: 

Chryssaphes Ftammlgw Associates, Bechtel House, 245 Hammersmith Road. London W6 BOP. 


FINANCIAL TIMES FRIDAY NOVEMBER- 11 : X99f 


Financial Director 


Mil CORRIDOR 


£40,000 + C AR * BOWES 

+ OTHER BENEFITS 


THE COMPANY 

■ profitable manufacturer of high quaffty branded products. . 

■ Turnover in excess of £20m. 

■ Pant of major international pfc with strong reputation Ibr financial coiitiu^. 

THE ROLE 

■ To assist the MD in Improving protitabHIty and co ntrollin g, capital , 

employed, wtth board involvement in commercial strategy. ' 

■ Responsible for accounting and MIS ftinetions. 

THE PERSON 

■ Qualified accountant, aged over 32 with manufacturing experience and 

comfortable with sophisticated management Information and reporting 
systems. .. 

■ Proven hands on style, man manager and team player. - r.-i' 

■ Good interpersonal skills, commitment and commercial acumen. 

■ Excellent career prospects within this UK based group. ■ . T 

Please write enclosing foil curriculum vitae quoting ref: 160 to: 

Nigef Hopkins FCA, London House, 53-54 Haymarket, London SW1Y 4RP- 
Tel: 071 839 4572 F3x: 071 925 2336 


NIGEL H O P K 1 NS 

a AS (so C I I I A J T E J S 

FINANCIAL & TREASURY SELECTION 








Rugby 

c£35,000 
+ car 


Finance Director 


INTERNATIONAL 


The Outward Bound Trust has been a 
registered charity since 1946 and has a proud 
50 year record of providing the very highest 
quality and range of outdoor personal 
development courses in the UK. Thousands of 
people of ali ages and backgrounds benefit 
from an Outward Bound experience each year. 
Annual expenditure of £4m must be met 
primarily from course fees, which in turn 
demands effective marketing and the astute use 
of resources. 

Reporting to the Trust Director and based at the 
Rugby administrative office, you will not only 
head up the finance function but you will also 
have responsibility for IT, commercial 
administration, and premises management of 


the 4 national centres located in NW Scotland, 
the Lake District and mid-Wales. 

A qualified accountant, you will be an 
experienced financial manager and 
administrator who consistently delivers 
practical solutions to business problems. You 
will also be a strong contributor who feels 
comfortable in a high profile role. Excellent 
interpersonal skills and a good attitude to 
positive change are more important than age or 
sector background. 

Please write, in confidence, with full CV and 
salary details to Graham Campbell, MSI 
International Limited, 32 Aybrook Street, 
London W1M 3JL. Please quote reference no. 


EXECUTIVE RECRUITMENT CONSULTANTS 


'eUt* 

listed 


LONDON 
071 467 5000 


BIRMINGHAM 

021 454 6864 


GLASGOW 
041 246 7700 


LEEDS 
0512 454757 


MANCHESTER 
061 834 2425 


Project Accountant 


Major Media Group 

City 


£highly negotiable + benefits 


Our client is a prominent, progressive UK pic which occupies a dominant position in publishing and other 
media. Recognising the importance of management information in enabling it to drive forward its operations 
with maximum efficiency, the Group is introducing key performance measures throughout the business. 
Attention has recently focused on the production department, where current changes Include the Introduction 
of new costing systems and strengthening of local financial support 

The magnitude of the project has created the need for an ‘internal consultant" who will act as a focal point and; 
provide the link between senior production personnel, the finance department and external consultants. The 
ability to facilitate fruitful collaboration between these parties will be a critical success factor. Upon completion 

01 the production project, your skills wflf be deployed in other functional areas of the business requiring the 
introduction of performance measures. 

You must be a 'Big Six' trained graduate ACA, aged late 20's - early 30’s, who has subsequently spent at least 

2 years in the consultancy division ol a major firm. Media knowledge and familiarity with production costing 
systems, though useful are less important than experience of developing performance measures, a thorough 
understanding of IT systems and project management skills. Success In this pressurised, highly visible role will 
undoubtedly lead to other opportunities within the Group. 

Please write, in confidence, enclosing full career and salary details, to Tim Knight, quoting reference TCK/1011. 


Selection & Search 

1-2 Dorset Rise, Blackfriars, London EC4Y 8AE 






•-T" t : ■»■” m v* ‘ 


^ /H-fiittoim 


Al-Futtaim Motors, a subsidiary of a major International Trading Group, is the sole distributor for Toyota and Hino 
in the United Arab Emirates. It successfully exploits a comprehensive and state-of-the-art retailing network of sales, 
service workshops and parts distribution centres, as well as a major Tyres. Batteries and Accessories operation. 


General Manager - Finance, Dubai 


The General Manager - Finance reports to 
the Managing Director and ensures the structuring 
and maintenance of the Company’s complete 
financial reporting system and provides relevant and 
timely financial information to the Board. The selected 
candidate wiH have experience in Treasury/Forex 
operations and development of computerised 
systems, and play a pro-active and strategic role as 
a member Secretary of the Board. 

Candidates should hold an appropriate professional 
qualification (ACA, MBA), with in-depth experience in 
computerised management accounting, Ideally in a 
trading organisation. A natural disposition towards 
team working and strategic thinking, a strong intellect 


and commercial focus are essential. Progress into a 
generalist career is possible. 

The package includes tax-free salary, bonus, 
end-of-service gratuity, free furnished villa, company 
car and first class annual leave passage. 

Dubai is a very cosmopolitan city in the Gulf and 
offers, a wide range of leisure and sporting activities 
with the opportunity for a married partner to take up 
employment. 

tf you believe this exciting opportunity matches your 
career aspirations, please call 0971-4-2034096 or fax 
your detailed CV to 0971-4-212933, to: 


Group Finance Director 

North West (£100,000 package 


This is a main board position within a long established and 
well known privately owned group with a turnover in the 
region of £60m- Despite difficult trading conditions through 
the recession, they have maintained their position as a key 
player in their sector and are well placed to take advantage 
of the economic upturn and increasing business confidence. 

The group now seeks to put in place a strategy of focusing 
on core businesses to ensure their future profitability and 
growth. This period of change offers a unique challenge and 
career opening to a Finance Director with a hard-nosed 
attitude to business and cost oontroL 
Reporting to and working closely with die Group Chief 
Executive you will determine strategies, review options, 
model business plans and seek innovative solutions to 
complex operational issues. Considerable emphasis is also 
placed on managing and developing successful working 


relationships with financial institutions, key customers and 
suppliers. 

Relevant candidates will be qualified acco un tants ideally 
with experience in the construction, civil engineering or 
contracting industry. Your track record must demonstrate 
success and achievement in your career to date with at least 
five years experience of operating at board level within a 
commercial entrepreneurial environment Your personal 
qualities must indude fust class communication skills, a high 
degree of commercial awareness, ability to build 
relationships and professional confidence/ credibility both 
within the group arid with external sources. 

The remuneration /benefits package reflects the importance 
of the appointment and will not prove a bar in the final 
selection process. The package includes basic salary, 
performance related bonus, company car and pension scheme. 


Onno Boers, Group Director - Personnel and Administration, AI-Futtaim Group, P.O.Box 152, Dubai, United Arab Emirates. 


BROOKS 


Please reply providing a detailed curriculum vitae, including current salary details and daytime 
telephone number to Mary Byrne at Stark Brooks Associates, Suite 4, 2nd Floor, St James's 
Buildings, Oxford Street Manchester Ml 6FQ, no later than Monday, 21st November 1991 


4 h: 



UHL ALE • 1 HO MAS- ■ HODGIN S • PI.C 


Financial Director Designate 

South Coast Package to c.£40,000 + car 

Our client is an established, privately owned, automotive component manufacturer. Its impressive customer 
base includes a large number of blue chip clients and the company exports its products throughout Europe 
and the Middle East Founded over 100 years ago, the company has a well deserved reputation for 
innovation, quality and customer service. With current sales volumes standing at £6m p.a. and an enviable 
profit return, the organisation is well placed to achieve its strategic objective of turnover in excess of E 10m 
p.a. by the end of 1996. 

The company now seeks a graduate calibre, qualified accountant to take responsibility for the finance and 
administration function. Key responsibilities will include compilation of financial and statutory information; 
definition of existing financial systems and controls; development of management information systems to 
reflect the future needs of the business; provision of detailed management reports to include analyses of key 
performance indicators; and continuing enhancement of computer systems in order to provide a sound 
platform for future development. Additionally the postholder will be responsible for appropriate company 
secretarial duties. 

Interested-candidates should send a comprehensive CV, highlighting relevant experience and including 
remuneration details to Karan Paige at KPMG Management Consulting, Richmond Park House, 15 Pembroke 
Road, Clifton, Bristol BS8 3BG. Telephone (0272) 464042. 


0Sf&Selection & Search 


v"; appeals In the UK edition every Wednesday & Thursday and in the International edition every Friday 

. v - \ v : Philip Wrigley on +44 71 873 3351, JoanneCki^ ’ 




riw - 
■- 

S-v.,- 











17 








Brossette JB77 

Sanbaira ■ Chouffage Canalisalion 


FINANCIAL TIMES 


* " 3 S'la 


.* **-*!■.*,,- 


=: ~ s *«:v ii 


benefits 


CTOfl 



•UX1K01O-UM. 

e»^uucoc 


Northumbrian Water doubles 

Northumbrian Water Group yesterday took the lead 
in the UK industry’s dividend bonanza with a 
record 16 per cent increase from 8.1p to 9.4p for the 
six months to September 30 in its first payout since 
the price review. Page 22 

Recovery helps Burton to £41 m 

Burton, the UR clothing retail group inclu din g 
Debenhams, Burtons and Dorothy Perkins, more 
than doubled profits last year despite falling into 
the red in its multiples division. Page 23 

Coats Vlyella lines up buyers 

Coats Viyalla, the UK’s largest textiles company, 
has lined up several buyers for its yarns, fabrics 
and carpet divisions. Page 24 

Danes consider big pig grotqs 

Danish cooperative slangiitwhniBM are consider* 
ing merging to form one large company. The result- 
ing company would he the second largest industrial 
group in Denmark and the biggest pigmeat process* 
ing group in the world. Page 28 

1 Aca de m ic a nswer to UBS 

Two Zurich academics have conctadod thtrt direc- 
tors of Union Bank erf Switzerland new have enough 
proxy vote to win shareholder approval to convert 
the registered into bearers at an EGM on November 
22. Back Page 


Companies In this Issue 


AT&T 

AkzoNoM 

ABstate 

Aaahl Ctandcal 

Axa 

BAe 

BT 

Bang & Olufser 
Bank of America 
Bank of Ireland 
BankWart 
Buton 
CU Ranee 
Campari tnS 
Carrefour 
Qaacadn. 
Challenge Bank 
ChMfhiat Bank 
Citibank 


' Cookaon 
Cranawtek 
.Cray Computer 
Oak Nicholson 

EDS 

Four Seasons Hotels 

QCS 

QEC 

Henderson Admin 
hHghlands Gold 
Hyundai 
. Inco 
LIMIT 

Lloyds Bank 

Market Statistics 

fAmtial reports santeo as 
Bondwarit Govt bonds 
Bond fifiures and options 
Bond pde« and jitakb 
Gaaamttes prices 
DMtands amounoad, IK 
ae currency rates 

Eurobond prices 
RwHtaMbtlCK 
FT-A WWW Wcm Back P 
FT GoU HBnes index 
FMSSMMDcndSW 
FT-SE Actuaries indices 


IB Logitech 
20 Lufthansa 

19 Lyonnaba das Eaux 

20 MetroQas 

17 MfngPso 

23 Mitsubishi Chemical 
Nippon Chemical 
■' Nudear Soctric 
“ Orb Estates 
7 Oxford tnstxumanta 
23 parkland 

20 puma 

23 Pharmacia 

18 Porter Chadbum 
23 Prudential Corp 

19 Qanfaa 

2Q Rhfine-Poutanc 
2Q Royal DutcfvSheO 
_ Royal Insurance 
® Sankyo 
7 Santa Fa fntf 
* Scottish NUctaw 

23 sears 

24 Siemens Nbcdorf 

19 Singapore Airlines 

24 Sonic 

20 Standard Chart Bank 
<0 Stavetey Inds 

on Strategic Hokfings 
22 SunWgh 
S ThoOap 
Ir Umaco 
M VSEL 
10 Vaba 

20 VValkw (JO) 

25 Woffington IPwriting 
12 Wesfarmers 


32-33 

Forrtpi metonse 

as 

Z1 

6Ra prices 

2t 

21 

Llffa equity cfXkma 

31 

21 

London tars sendee 

3233 

2B 

London trad options 

31 

22 

MaBgsdflraSB ranks 

34-33 

SB 

Money roartots 

as 

21 

Now Ml bond terns 

21 

2t 

New Y«* store sente 

38-38 

EtoOB 

Receat isaues. UK 

31 

31 

Short-torn tot rates 

38 

21 

U5 interest rates 

21 ■ 

31 

Worm Stock MeriotB 

37 | 


COMPANIES & MARKETS 


©THE FINANCIAL TIMES LIMITED 1994 


Friday November 11 1994 


Fletcher King 

CHARTERED SURVEYORS 
COMMERCIAL PROPERTY 
CONSUL) ANTS 
London 
071-493 8400 

SiRWP'GHAV MANCHESTER NORWICH 
NORTHAMPTON 


IN BRIEF 


Cuts offset weak 
sales at Pharmacia 

Pharmacia, the Swedish drugs group, yesterday 
said underlying operating profits rose 18 per cent in 
thefirst nine months to SKr4-43bn ($602 ,2m). Cost- 
cutting enabled the group to improve against health 
authority clampdowns which reduced sales of some 
of its leading drugs. Page 18 

Lufthansa shows further rise 

Lufthansa, the German national airline, continued 
its much improved financial performance thfc year, 
hffing pre-tax profits by 51 per cent in the third 
quarter to DM220m ($M3.79m). Page is 

Hyundai buys NCR chip operations 

Hyundai Electronics America, a US subsidiary of 
the South Korean Hyundai group, hag agreed to 
acquire the semiconductor operations of AT&T 
Global Information Solutions, formerly called NCR, 
for more than SJOOm. Page 19 

Nickel outlook brightens 

Twelve months ago. Inco, the western world’s big- 
gest nickel producer, was tr imming its Mils to COpe 
with what looked like an unremitting market 
slump. Now the nickel price has climbed to almost 
$3 per lb. the directors are confident enough to 
approve a clutch of new projects. Page 20 

Japanese chemicals put faith In cost cuts 

Japan's chemical industry continued to suffer from 
falling prices and weak demand in the first half of 
this year, bat its leading companies believe cost-cut- 
ting will help them lift earnings. Page 20 

Attwoods ready to go up for sateAttwoods, 
the UK waste services group, is today expected to 
promise shareholders it will put itself up for sale if 
investors reject the hostile £364m ($S96m) cash bid 
from Browning-Ferris Industries of the US. 


Shell dips as margins tighten 


Chief price changes yesterday 


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I By Robert Corzine in London 

Production losses from the recent oil strike in 
Nigeria and fighter refining margins in Asia 
caused third-quarter profits for the Royal 
Dutch/Shell group to ease back 1 per cent to 
E853m (S1.4bn). 

Shell shares closed 8p down at 71Lp, after 
the company reported a 3 per cent drop in net 
income for the nine months to £2 J8bn on an 
estimated current cost of supplies basis, simi- 
lar to a replacement costs measure. 

Shell, in common with other integrated oil 
companies, experienced a strong cyclical 
rebound in chemical earnings during the 
third quarter. 

Rising volumes and lower operating costs 
resulted in chemicals' earnings of £l58m. 
against a £168m loss last time. Shell said it 
was optimistic that demand would grow as 


world petrochemicals' markets continue the 
recovery In line with stronger economic 
growth in the main industrialised economies. 

The rebound in chemicals failed, however, 
to offset tigher refining margins in Asia, 
where SbeU has extensive downstream inter- 
ests. High refining margins in the region 
drew in imports of refined products from Mid- 
dle East producers such as Kuwait. New refi- 
nery capacity in the area eroded margins 
further, although Shell predicted an Improve- 
ment In the fourth quarter. 

Total oil product sales were up 8 per cent 
outside the US, with increases in Asia and 
Latin America offsetting a decline in Europe. 

The third-quarter results were also 
depressed by file effects of the Nigerian oil 
strike this past summer. The loss of produc- 
tion from Shell's large onshore fields in 
Nigeria caused worldwide net equity crude oil 


production in the quarter to fall by 2 per cent 
to 1.69m barrels a day. 

Exploration and production earnings fell 37 
per cent to £350m. The loss of Nigerian output 
coincided with this year's highest world 
crude oil prices. It also lowered cash flow to 
£5.6bn. against £SRbn last year. 

Shell expects crude oil prices to firm in the 
fourth quarter, when demand usually 
increases because of winter in the northern 
hemisphere. But it noted that price move- 
ments were also dependent on the actions of 
the Organisation of Petroleum Exporting 
Countries at its meeting later this month. 

Capital expenditure and exploration spend- 
ing for the nine months rose 10 per cent to 
£4.6bn. Total debt remained relatively modest 
at £83bn, with a total debt ratio of 18.4 per 
cent. 

Lex, Page 16 


BT held back by 
cost of cutting 
jobs and prices 


Robert Corzine sees oil groups overcoming risks to develop promising fields 

New frontiers Non-Opec countries roll out the barrels 


open up in the 
deep blue sea 

O il companies are keen fol- to 10 years for most proj 
lowers of fashion. As Chewing deep water ex 
soon as one makes a sig- promises further big gair 


Mon-Opoc capacity ackitions from discov e red thfcfa 

mb/d 

&S- 


NM producing 

In 1905 - 


O il companies are keen fol- 
lowers of fashion. As 
soon as one maims a sig- 
nificant discovery in a promising 
new area, others pile in. 

At least that was the hope of 
the UK government, which ear- 
lier this week gave the gosahead 
for the development of Foinaven, 
the UK’s first oil field in the deep 
waters west of the Shetland 
Talarirfa. 

British Petroleum has esti- 
mated total reserves at Foinaven 
of 250m-50Qm barrels of oil, plac- 
ing it in the upper range of 
recent North Sea discoveries. But 
the field is m uch gmallar thaw 
the multi-billion barrel fields 
such as Forties and Brent discov- 
ered in the early stages of North 
Sea exploration. 

For the UK. however, Foinaven 
promises to open up a new fron- 
tier oil province of perhaps &5bn- 
4m barrels of oil, piaring it in 
the “world class” category. 

Foinaven is further evidence 
that oil companies are increas- 
ingly confident that they can find 
and produce oil in water depths 
and conditions which just a few 
years ago would have been 
judged too risky. 

New seismic techniques enable 
geologists to “see" potential 
fields better. Advanced drilling 
methods allow wells to have 
lengthy horizontal sections 
within the reservoir, so more oil 
can be recovered and fewer wells 
need to be drilled - important 
when a well can cost $lGm-$15ra. 
BP expects first oil from Foin- 
aven three and a half years after 
its discovery, compered with up 


to 10 years for most projects. 

Growing deep water experience 
promises further big gains In effi- 
ciency and cost savings. US oil 
companies have joined together 
in the Deep Star programme to 
develop deep water technology. 

Other savings are being real- 
ised through design improve- 
ments, such as Shell's floating 
platform at its new Auger field in 
2360 ft of water in the Gulf of 
Mexico which contains 39,000 
tons of steel. Refinements mean 
that the nearby Mars platform 
being installed in 2.933 ft of water 
will contain 8,000 fewer tons of 
steeL 

Mars’ planned output of 100,000 
b/d will be double that Auger, 
but it will cost S200m less. 

S uch savings have helped to 
s lash finding and develop- 
ment costs per barrel, 
which in Foinaven ’s case is down 
to 54-$5. That makes such devel- 
opments economically feasible 
even when crude oil prices are at 
low levels. 

Given the prospect that costs 
for new projects will fall even 
further, the enthusiasm for deep 
water projects is likely to grow. 

Some of the most promising 
deep water oil regions, such as 
the west of Shetlands and the 
Gulf of Mexico, are close to estab- 
lished offshore oil provinces. 
Companies have ready and cheap 
access to shore terminals and 
undersea pipelines which can be 
extended to the frontier areas. 

But could the deep water pro- 
jects influence world crude oil 
prices in coming years? Some 




'Jm .f y Mexico 

— 

\ > .*. * ■ Rr-rHI 




V ^ us iTT 


By Alan Cane hi London 

The cost of cutting prices and 
jobs held back revenues and prof- 
itability at British Telecommuni- 
cations in the first six months. 

Sir Iain Vallance, chairman, 
warned that the second-half 
results would be affected by the 
same factors, influencing a 5p fall 
in the share price to 388p. 

Despite a stronger UK economy 
which helped to push up inland 
call volumes by more than 7 per 
cent, profits before tax were 
£l.£)bn ($2.44bn), slightly below 
the £1.5bn recorded last time. 
Turnover rose to £6.85bn com- 
pared with £6.76bn. Earnings per 
share fell from 15.6p to I5p. 

Sir lain said the group's under- 
lying performance was strong, 
arguing that after adjustments 
for redundancy charges of £151m, 
a £?5m premium on the repur- 
chase of bonds and the effects on 
the results of the disposal of 
group undertakings, turnover 
was up by 2.4 per cent in both the 
second quarter and the half year. 

On the same basis, pre-tax prof- 
its rose &2 per cent in the second 
quarter and 3.7 per cent in the 
half year while earnings per 
share were up S per cent in the 
second quarter and 3.4 per cent 

in fhp half year. 

An Interim dividend of 7.05p 
will be paid representing a 6 per 
cent improvement on last time. 
At the same stage last year. Sir 


Iain had warned that the 8.1 per 
cent rate of dividend growth 
awarded then was unlikely to be 
maintained. 

The group had dropped prices 
11 times this year under the con- 
ditions of its pricing formula and 
had already returned about £lbn 
to customers in the form of price 
cuts with a farther £400m to be 
shaved in the present year. 

Mr Michael Hepher, manag in g 
director, claimed success far the 
“Good to talk " advertising cam- 
paign and for specific marketing 
initiatives such as National 
Weekend Rate. 

Staff numbers were now 
151300, 4,400 lower than the start 
of the year and on track for a 
reduction of 15.000 in the full 
year. 

Sir Iain said that Concert, the 
group's joint venture with its US 
equity partner &1CL was ahead of 
the competition in being able to 
offer international companies 
“seamless" voice and data ser- 
vices; the venture bad some 75 
new customers representing 
£200m in additional revenue. 

Completion of the MCI invest- 
ment increased the group’s gear- 
ing at September 30 to 29 per cent 
with net debt s tanding at £337bn. 

Analysts yesterday described 
BT's performance as sound 
across the board. Pre-tax profits 
estimates for the full year are 
unchanged at about the £2.45bn- 
£23bn mark. 


m- 


fjfrfr* USJ Others 

- ” Syria. Yemen — 

and Oman Norway 
a5 ‘" Mexico 


, Norway 

US j Others ? 

T-— 

wn Norway s-As 


Axa may seek foreign 
listings to build base 


•YiJ UK 


1093 . 

Saurcx Carrwridga Energy Fiexoarzn Msocta&a 

analysts think they will. 

They note that apart from the 
UK and US, many of the most 
exciting deep water prospects are 
in Brazil, Mexico, Malaysia, the 
Philippines, Angola and Namibia. 
With the exception of Nigeria, 
they are outside the Organisation 
of Petroleum Exporting Coun- 
tries. and therefore not subject to 
Opec production quotas. 

Other analysts note that even 
relatively small changes in oil 
output in key countries such as 
the US or the UK can have a 
far-reaching effect on prices, 
because of the central price-set- 
ting performed by benchmark 


crudes such as Brent Blend. 

The sharp rise in non-Opec pro- 
duction over the past year has 
clearly confounded current Opec 
attempts to boost prices. 

Mr Mehdi Vaizi of London bro- 
kers Kleinwort Benson says there 
is a possibility that oil markets 
and Opec will continue to under- 
estimate non-Opec production 
over the next few years. 

Mr John ToaJster of London 
brokers Sorifete Gtodrale Strauss 
Turnbull, says; “The North Sea is 
the current bdte noire of Opec.” 
Foinaven and the other fields 
west of Shetlands may in the 
future assume that mantle. 


By Ancfaew Jack in Paris 

Axa, one of France’s largest 
insurance groups, is considering 
seeking stock exchange quota- 
tions in Loudon and Tokyo as 
wen as New York over the next 
two years, it said yesterday. 

Mr Claude B£b6ar, chairman, 
was keen to broaden the share- 
holder base and obtain listings 
in other countries where the 
company has significant busi- 
ness interests. 

The listings are aimed to lift 
the profile of the company inter- 
nationally and aid in capital 
raisings for foreign development. 

Axa is already at an advanced 
stage of talks with the New York 
Stock Exchange about obtaining 
a US listing. It is embroiled in 
negotiations over the different 
accounting requirements 
demanded by the Securities and 
Exchange Commission. 


Mr B£b£ar said he was also 
keen to issue shares in the UK 
and Japan. “We are seen as a 
French company. We want to 
show that we are becoming more 
and more global,'’ he said. 

He would not give details of 
the size of the potential new 
share capital but said ultimately 
it would make sense for Axa to 
have stock market capitalisa- 
tions in the leading world mar- 
kets in proportion to the amount 
of business it does there. 

Axa is developing links with 
analysts in London, Edinburgh 
and Frankfurt this year. 

Mr B6b£ar said he was also in 
discussions about raising 6100m- 
6200m through other forms of 
finqm riwl instruments next year. 
He stressed that the company 
already had access to facilities of 
about FFrSObn (65.85bn) if it 
needed to make quick decisions 
about potential acquisitions. 


Siemens Nixdorf s new chief reviews his first months 

Race to renew a 

JL accumulated losses of ^ 

s corporate culture 

chief executive of Siemens LV V W-l L V 


I f Mr Gerhard Schuhneyer is 
worried about his company’s 
accumulated losses of 
DM?..25bn (SlJjtm), he does not 
show it The new president and 
chief executive of Siemens 
Nixdorf (SNI) seems more con- 
cerned about imtis of tftri* 11 than 

D-Marks end dollars. 

The Siemens group has ample 
funds and profits to maintain foe 
transfusions into its aihng infor- 
mation technology subsidiary 
which started when the acquired 
Nixdorf business was clumsily 
grafted on to its own mainframe 
operations in 1990. 

But time is a different matter, 
and as Mr Schuhneyer said yes- 
terday, the years which in nor- 
mal circumstances would be 
needed to complete the job of 
renewing SNTs culture are not 
available to him. 

“Changing a corporation's 
mentality usually takas three to 
five years, and we don’t have it,” 
he told a press conference called 
to review his early days — 132 of 
them, as he pointed out - at the 
company. 

Although striving to be tactful 
about SNTs previous bosses, he 
made plain that their admirable 
ambitions of becoming fast flexi- 
ble and close to the customer 
were unattainable in the strait- 
jacket of traditional, vertically 
structured German management 
methods applied hitherto, 

“We cannot think in terms of 
two-year or five-year plans. We 
have to think of days," he said. 
“If you don’t have a major techni- 
cal feature change every six 
months you start to look old. You 
must revamp your entire product 
range every 12 months or you 
begin to look out of step." 

Mr Schuhneyer, formerly head 
of Asea Brown Boveri’s US 
operations, and fresh from six 
months’ teaching maMgMBBDt at 
the Massachusetts Institute of 
Technology, admitted the pro- 
cesses he was trying to introduce 
were alien to Germany, but 
Insisted they were essential for 
the success of a high-technology, 
market-driven business. 



Scbulmeyen improved odds 

“Classical functional organisa- 
tional structures, in Germany 
especially, inevitably lead to a 
fragmented way of working with 
all the attendant penalties of 
delay, inflexibility and high over- 
heads. 

“Conventional approaches to 
hiring, training and developing 
employees create narrow-minded 
and inflexible specialists and a 
management cadre that has few 
entrepreneurial skills beyond 
paper-poshing and in-fighting-" 

Such conflicts figured large 
among the well-publicised prob- 
lems which afflicted SNI from the 
outset, and which Mr Scbulmeyer 
yesterday suggested had still not 
been property resolved. During 
the unification process, insuffi- 
cient attention was paid to rein- 
forcing the relative advantages of 
the two cultures, he said 

"SNI has not yet achieved a 
well-formulated cultural dimen- 
sion,” be charged. “Siemens is 
still dreaming of its mainframe 
days and Nixdorf is still in its 
mid-range mentality." 

And, he suggested, there was 


no greater sin for an information 
technology group than to dwell 
on the past: u We should not try 
to find the future by analysing 
our histories to death.” 

“We managers have to learn to 
take risks otherwise nothing will 
happen," he said. As for the risk 
of his failing in his main ambi- 
tion, Mr Schulmeyer said be bad 
given himself a 60:40 chance of 
successfully changing the SNI 
culture when he arrived. Since 
then he had met or addressed 
11,000 of the group’s employees. 
Young managers had been sent 
for training in the US. He had 
employed restructuring experts 
and he had reserves of expertise 
among his colleagues at MIT. He 
felt the odds on his success had 
improved to 70:30. he said. 

Business was also improving. 
In spite of appearances. SNI was 
not teetering on the brink of 
disaster. It was on a healthy 
recovery path, he claimed. In the 
current financial year, when 
Europe's computer price wars 
would cost the group even more 
than last year's DM900m, the 
company would make an operat- 
ing profit, although further 
restructuring charges would 
leave it with another deficit on 
the bottom line, he said. Sales 
were expected to grow 4 or 5 per 
cent and productivity was 
planned to increase 15 per cent. 

Although SNI lost DM350m last 
year, the situation had improved 
in the second half when turnover 
increased 23 per cent, said Mr 
Schulmeyer. Over the whole year 
personal computer sales had 
increased 50 per cent compared 
with 1992/93. The PC division had 
gained a 10.4 per cent share in 
Germany, was growing sales fas- 
ter than tbe market, and was no 
longer a “headache financially". 

Christopher Parkes 


ACTIVE WORLDWIDE 


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HaiMbt* Boat Lasted 

acted t% fiomdil adAsr to 

WoUcnKImerNV 

iaitamnsMHo 


A selection of transactions on which Hambros has advised in 1993 and 1994 

HAMBROS BANK LIMITED 
■II Tower Hill London EC3N 4 HA Tel: +44 71 480 5000 
Mmbct uf SFA 






•• ; . 











18 


FINANCIAL TIMES FRIDAY NOVEMBER l H994 


INTERNATIONAL COMPANIES AND FINANCE 


Lufthansa keeps 
up improvement 
with 51% rise 


By Andrew Fisher in Frankfurt 

Lufthansa, the German 
national airline, continued its 
much improved financial per- 
formance this year, lifting pre- 
tax profits by 51 per cent in the 
third quarter to DM220m 
($143.79m). The airline said it 
expected to break even in the 
fourth quarter. 

For the whole year, it 
expects to make a profit and 
pay a dividend for the first 
time in five years. Sharehold- 
ers last received a DM4 pay- 
ment per share in 1989. 

The company said that In the 
first nine months, it made a 
pre-tax profit of DM325m, com- 
pared with a loss of DM76m in 
the same period of 1993. Group 
cash flow would total DM2.2bn 
this year, it added, with total 
investments at DM1.8bn. It 
gave no comparative figures. 

Revenues from flight 
operations were 8 per cent 
higher in the first nine months 
at DM10.6bn, with total reve- 
nues 7.5 per cent higher at 
nearly DM 12b n. 

Passenger numbers were 


28.4m, a rise of 4.7 per cent, 
with sales in terms of tonne- 
kilometres 8.8 per cent higher. 
Cargo business in the nine 
months rose by 20 per cent and 
the overall load factor by 1.8 
percentage points to 70.4 per 
cent 

The airline, which recently 
signed a partnership deal with 
Thai Airways International 
covering both cargo and pas- 
sengers, had posted its first 
profit for five years in the first 
half of this year; pre-tax profits 
totalled DM105m, against a 
DM22lm loss in the corre- 
sponding period of 1993. 

Last month, the government 
yielded control of the airline 
by not taking up its entitle- 
ment in a rights issue. 

The shares were sold to 
investors in Germany and 
abroad to raise more than 
DMlbn. 

It has also decided to spin off 
its cargo, maintenance and 
information technology ser- 
vices into independent profit 
centres to continue the 
streamlining begun several 
years ago. 


Watchdog to probe 
Carrefour share fall 


By Andrew Jack In Paris 

The French market watchdog 
yesterday launched a formal 
inquiry into Carrefour, one of 
the country's leading hyper- 
market chains, in the wake of 
a sharp drop in the company's 
share price following rumours 
on the Paris bourse. 

The rumours appeared to be 
the cause of a drop of up to 8 
per cent in the price of the 
shares yesterday, following a 
decline the day before of 4.7 
per cent 

The Commission des 
Operations de Bourse con- 
firmed last night it was investi- 
gating Carrefour on two 
grounds: the market in the 
shares, and two pieces of 
price-sensitive information it 
had received two days earlier. 
It refused to give details of 


what the information con- 
cerned. 

However, Carrefour said the 
share price fall appeared to 
have been caused by two 
rumours: that it was to 
announce an increase in its 
capital in an effort to buy 
Caro, a distribution company, 
and that it had offered bribes 
to the Communist party. 

The group flatly denied the 
two rumours yesterday and 
said it would welcome and 
co-operate fully with an 
inquiry by the COB. 

It said it had no plans to buy 
Caro, with which it said it had 
no connection. 

The company added that it 
had no detailed knowledge of 
the background to any bribes, 
hut firmly rejected suggestions 
any money bad been paid to 
the Communist Party. 


Bologna 
banks get 
go-ahead 
for merger 

By Andrew HOI in Milan 

The Bank of Italy yesterday 
gave the go-ahead to a pro- 
posed merger between two 
Bologna hanks - Credito Rom- 
agnolo (Roto) and Cassa di Ris- 
parmio in Bologna (Carisbo) - 
giving them a head-start over 
Credito Italiano’s rival plan to 
take control of Rolo. 

The central bank, which 
supervises the fragmented 
Italian banking sector, is still 
considering Credito Italiano's 
plan to bid L2,000bn (SI -27bn> 
in cash for a 48 per cent stake 
in Rolo, to add to the 2-3 per 
cent it already owns. 

The Bank of Italy was not 
expected to reject the planned 
merger between Roto and 
Caer. Carisbo's holding com- 
pany. Earlier this year, it 
approved a similar plan for an 
alliance between the two, 
which was then shelved. 

However. Rolo is bound to 
argue that the decision gives it 
a defensive advantage over 
Credito Italiano. The Bologna 
bank plans a shareholder 
meeting on December 19 or 20 
to vote on the merger, and it is 
also preparing to attack Cre- 
dito Italiano’s preliminary bid 
plans on legal grounds. 

Meanwhile, Credito Valtclli- 
nese, a small northern Italian 
bank, announced plans to take 
control of Credito Artigiano, a 
Milan-based bank in which it 
has a 20 per cent stake. 

ValtellLnese said it would 
pay Ll46-3bn for a 29.27 per 
cent stake held by Artigiano’s 
majority shareholder. Fonda- 
zione Vismara, and offer to 
buy np a 1.73 per cent from 
another shareholder to take 
control. 

Valtellinese has given the 
second shareholder, Fonda- 
zione Lambriaoa, until the end 
of the month to respond to the 
offer, but stressed yesterday 
that the move was a friendly 
one. If successful, the alliance 
will create an expanded net- 
work of 100 branches in Milan 
and the lakes area of northern 
Italy. Valtellinese, based in 
Sondrio north of Milan, has 
held a 20 per cent stake in 
Artigiano for five years, along- 
side the two charitable founda- 
tions, both or which are linked 
to the archdiocese of RIDlan. . 


Cuts offset sales fall at Pharmacia 


By Christopher Brown-Humes 
in Stockholm 

Pharmacia, one of the world s 
top 20 drugs groups in terms uf 
sales, said yesterday that 
underlying operating profits 
rose 18 per cent to SKr4.43bn 
($ 602 . 2 m) in the first nine 
months of the year. 

Cost cutting enabled the 
group to improve its perfor- 
mance. against increasing com- 
petition and health authority 
clampdowns which reduced 
sales of some of its leading 
drugs. 

Ycar-on-year comparisons 
were distorted by one-off gains 


and the group's acquisition of 
the Italian pharmaceuticals 
rnnipanv Farmitalia Carlo 
Krtia iFVe> in May 19*3. 

Pro-forma figures show 
underlying sales up 3 per cent 
at SKrl*.S7bn and operating 
costs down 4.2 per cent at 
SKrl4.84bn. One-off gains of 
SKrS42m helped lift operating 
profits t>» SKr4.43bn. up 61 per 
cent from last year's 
SKr2.74bn. Income after taxes 
and minority interests was 
SKr2.66bn. 

In the third quarter, operat- 
ing profits rose to SKrl.66bn 
from SKr996m. However, exclu- 
ding one-off gains of SKr658m. 


the Figure was just SKrl2m 
higher than a year ago. 

Pharmacia, privatised by the 
Swedish government in June, 
has mounted a cost-cutting 
drive since its Fice purchase. 
The programme aims to trim 
annual costs by SKrl^bn by 
1996 and lift the operating mar- 
gin to 20 per cent In the 12 
months to September 30, the 
margin reached 16.7 per cent, 
compared with 14.7 per emit for 
the full 1993 year. 

Sales development has been 
less successful. Sales of Geno- 
rropin, the company’s growth 
hormone drug, fell 6 per cent 
over the nine months, to 


SKrlRSbn. due to tougher com- 
petition in some markets and 
cost-containment measures in 
Spain, Australia and Italy. 

Sales of Heaton (cataract sur- 
gery) were 4 per cent lower at 
SKrlJBbn after being h it by 
tougher competition and lower 
prices in the US and Japan. 

The anti-blood dotting agent 
Fragmin has been hit by 
rhgng pri reimbursement rules 
in Japan. Its sales were 9 per 
cent lower at SKr592m. : 

The group’s anti-cancer prod- 
ucts, Farmorubicin and Ariria- 
my rnn, showed a favourable' 
development, with sales rising 
13 and 7 per cent respectively. 


Power generation helps surge at Veba 


By Michael Linde mann in Bonn 

Veba. the German energy- 
based conglomerate which 
recently announced a push 
into telecommunications, 
hoisted net profits by 49 per 
cent to DM677m (8U2.5m) in 
the first nine months of this 
year, up from DM453m. 

It was helped by strong sales 
at PreussenElektra, which is 
Germany's second-biggest 
provider of electricity. 

The increase was in line with 
forecasts, and the company 
said net profits for the full year 
would be “significantly" higher 
than last year’s DM825 ni. 


Earnings were also bolstered 
by thr sale of coal trading 
interests at the Raab Karcher 
unit, which raised DM 132m. 

Turnover for the nine 
months rose 6.6 per cent to 
DM .-.2 4bn. up from DM49.1bn. 
The sharpest rise, of 28.9 per 
cent, came at PreussenElektra, 
which incorporated for the 
first lime the results of five 
east German regional genera- 
tors bougiit at the beginning of 
this year. 

The company said its trou- 
bled chemicals division was 
raakini,' an operating profit, 
but there would be a loss for 
the whole vear because of fur- 


ther restructuring costs of 
DMlSQm. Sates rose Z.5 per 
cent to DM7.6bn. 

The results do not indude 
Vebacom. the company’s new- 
est division, created earlier 
this year. An international 
partner for Vebacom is expec- 
ted to be announced shortly. 

Mr Ulrich Hartmann, chief 
executive, recently announced 
a planned DM6bn investment 
in telecommunications over 
the next 10 years. Vebacom has 
a turnover of around DM240m 
according to most recent 
figures. 

Veba has a Id per cent stake 
in a consortium led by the 


French construction group 
Bouygues, which won the 
Ifrgprp to build France’s third 
mobile telephone network. It 
also recently announced a joint 
venture with Deutsche Bahn, 
the German railways, to build 
a corporate network over the 
DB i nfr a s tructure and linked 
to its network at Preussen- 
Elektra. 

Sales in the oil division, rep- 
resenting 21 per cent of group 
turnover, fell by around 4 per 
cent 

Trade and services, the larg- 
est division with 42 per cent of 
group turnover, saw sales slip 
by 0.4 per cent to DM21-8bn. 


Prudential to shorten j Motor premiums set 
directors’ contracts { to rise at CU France 


By William Lewis in London 

The Prudential Corporation, 
the UK’s largest investing 
institution, is poised to follow 
the trend of other large compa- 
nies and cut the length of its 
directors' service contracts. 

This move follows mounting 
criticism from institutional 
shareholders of large payouts 
to directors who have resigned 
while holding long service con- 
tracts. It marks a reversal of 
the Prudential's policy, which 
previously gave strong support 
to three-year rolling contracts. 

Last June it said: “If we want 
to recruit and retain the right 
quality of executive on to our 
board, we need to offer them a 
competitive remuneration 
package and currently a three- 


year contract is part of that 
deal." 

This v.-as in response to the 
launch uf a campaign by Pos- 
Tei. the £25bn <S40bn; pension 
fund, railing for a reduction in 
the length of service contracts. 
PosTei votes against the elec- 
tion or re-election of directors 
with rolling employment con- 
tracts longer than two years. 

The Prudential's change of 
policy is likely to remove the 
possibility of PosTei embar- 
rassing it at its annual meeting 
in May. when Sir Martin 
Jacomb, PosTei chairman, is 
due to become non-executive 
chairman of the Prudential. 

Five executive directors of 
the Prudential have three-year 
rolling contracts. 

Lex, Page 16 


By Andrew Jack 

The French arm of Commercial 
Union, one of the UK's biggest 
composite insurers, is set to 
raise motor premiums by up to 
10 per cent early- next year as 
part of an effort to increase 
profitability. 

Commercial Union France, 
known as Victoire before it 
was acquired by the UK 
insurer earlier this year, also 
plans to merge its operations 
in France in an effort to cut 
costs. 

Commercial Union earlier 
this week reported worldwide 
pre-tax profits of £305m ($4S8m) 
for the first nine months of the 
year, or nearly double the 
amount for the same period 
last year. 


CU France reported total pre- 
mium income up 16 per cent to 
FFrl9.7bn (£L7bn) for the first 
three quarters. 

life income rose 20 per cent 
to FFrlllbn and non-fife 5 per 
cent to FFr&Sbn. 

Mr Bernard Pettier, director 
general of Commercial Union 
Assurances, one of the main 
subsidiaries, said he expected 
motor premiums to rise by 
between 8 and 10 per cent next 
April. 

The company would also be 
aiming to improve the selectiv- 
ity used to assess risk. 

Mr Pottier said that - in 
common with its competitors - 
the company had suffered 
from a rise in riflima caused 
by theft and windscreen j 

damag e I 


Restructure 
costs driver 
Logitech 
into deficit 

By Ian Rodger. fav Lauissnne 

Logitech, the world’s hugest 
maker of computer pointing 
devices (mice and trackballs), 
has reporteda SFE3Lj&n_C$2S*n) - 
loss in the six months to Sep- 
tember 30, mainly because of a 
SFr24m restructuring charge. 

- The Swiss group, struggling 
to bring down costs in 
response to a price, war hx the 
worldwide personal computer 
industry, is curtailing. produc- 
tion in the US and Ireland witit 
the loss of some 500: Jobs, a 
fifth of its total workforce. 

Sales were down I6J2: per 
emit to SFri.92.2ip in the first 
half in spite of a 20 per cent 
rise in volume. . Mr -Daniel 
Borel, chairman, said prices of 
pointing derices andscannars, 
the group's other product line, 
had fallen by between 30 and 
40 per cent during the' period. - 
Excluding extraordinary 
items, the loss reached 

SFr7.6m, compared with a 
pro fi t of SFr4.7m in the first 
half of fiscal 1993-04. 

Mr Borel acknowledged the 
figures were “troubling", mid 
admitted the group had hot 
responded quickly, enough to 
the intensifying challenge from 
low-cost east Asian-bared pro- 
duction. It had also excessively 
diversified. 

Production of commodity 
items would now be concen- 
trated in China, and high-tech- 
nology products would be 
made in Taiwan. The group 
had given up an attempt to 
break into the market for 
sound systems for computers. 

Mr Borel confirmed rumours 
that the directors had consist - 
ered seeking a partner to 
secure the company's future, 
but derided to “keep fighting”. 
Operating costs were now bet- 
tor aligned with those of com- - 
petitors and the balance sheet 
was strong with SFr83.Sm in 
shareholders’ ftmifa at the end 
of September. 

In the second quarter, the 
operating loss had been cut to 
SFrlm after losses of STrtlm . 
and SFnL6m in the two previ- 
ous quarters. 

He said the remainder of the 
current fiscal year would he 
"delicate" because of produc- 
tion transfers and redundan- 


This announcement appears as a matter of record only. 



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FINANCIAL TIMES FRIDAY NOVEMBER 1 1 1994 


INTERNATIONAL COMPANIES AND FINANCE 


Hyundai buys NCR chip 
operations from AT&T 


ByJLouiMKehoft 

in San Francisco 

Hyundai Electronics ^ r n °riCT L 
a OS subsidiary of the Hyundai 
group of South. Korea, has 
agreed to acquire the semi- 
conductor operations of AT&T 
Global Information Solutions, 
formerly called NCR, for more 
than 9800m. 

The acquisition is the Largest 
of its kind by a Korean com- 
pany in the US, Hyundai said. 
AT&T- announced in August 

that it was seeking a buyer for 

the NCR chip operations. With 
sales last year of $372m, the 
unit ' employs about 1,850 peo- 
ple. at two - semiconductor 
plants in Colorado as well as a 


plant in Wichita, Kansas, that 
makes circuit hoards for per- 
so&al computers. Hie division 
is profitable and its sales have 
been growing at about 25 per 
cent per year, AT&T said. 

Hyundai Electronics said it 
would retain the wirrent man- 
agement of the NCR division, 
which would operate as an 
independent, autonomous sub- 
sidiary. 

With estimated world sales 
of $1.05bn in 1993, Hyundai 
Electronics is the third largest 
Korean sendcondnctor manu- 
facturer, after Samanpg and 
Goldstar. Hyundai’s semi- 
conductor revenues are expec- 
ted to more than Hnqfrfft fbig 
year to about $28bn. 


To date, however, Hyundai's 
semiconductor operations have 
been heavily concentrated on 
memory chips, used in all 
types of computers. 

"The acquisition is a strate- 
gic move to expand Hyundai 
Electronics’ strong presence in 
the . global semiconductor 
marketplace from a volume- 
driven memory business to 
the high value-added 
integrated circuit business,” 
said Mr YJL Kim, chief execu- 
tive of Hyundai Electronics 
America. 

The NCR Microelectronic 
Products division produces spe- 
cialised microchips, del u d in g 
application-specific Integrated 
circuits. 


Cray unveils new supercomputer 


ByLouteo Kehoe 

Cray Computer, the struggling 
supercomputer developer, has 
announced a new twnfoi which 
it claims, will match the perfor- 
mance of any commercially 
available supercomputer at a 
fraction of the price. 

. The new “Cray 4° super- 
computer is priced at about 
J&nfar a system with perfor- 
mance equivalent to a S25m 
supercomputer sold by Cray 


Research, the world's leading 
manufacturer. Cray Computer 
is a spin-off from Cray 
Research, formed by Mr Sey- 
more Cray, founder of the orig- 
inal company bearing his 
name. •• 

Cray Computer has yet to 
make a single sale and its 
future is largely dependent 
upon finding a buyer for the 
new Cray 4 over the next few 
months, according to industry 
analysts. In recent months two 


Better margins lift 

to record 


By Richard Tomkins 
In New Tocfc - 

New store openings and better 
profit margins at existing 
stares helped The Gap, the US 
casual-wear retailer, produce a 
id per cent increase in art prof- 
its to a /earn! 993.6m in Its 
third quarter & 'October. 

• : 'Mr Doabakf fisher, chairman 
and chief exe c utive , said The 
Gap was -espe&feliy pleased 
with its ' Banana Republic 
stores, wMch had turned in an ' 
“impressive” performance for 
the quarter.' - ■ v 
Earnings per dare rose to 64 
cents from 54 -. cents. - 
At the end of the quarter, 


The Gap operated. 877 . Gap 
‘stores. 354 GapKlds stores, 184 
Banana Republic stares and 62 
Old Navy or Gap Warehouse 
stores. The total of M77 repre- 
sented an increase of 92 stores 
over the year-earlier figure. 

The group’s sales revenues 
rose by 10 per cent to 99888m, 
but ably because of the new 
store openings. Sales at stores 
that had been open for more 
than ay ear fell by 2 per cent 
- The' -sales - fall ' at existing 
stores,- however, was offset by 
a rise in margins, stemming 
from control over costs and a 
better merchandise ™», which 
'reduced, the need: for price 
markdowns to dear goods. : 






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ons 


? -_.r , 

By Bernard Shnoh In ^Tdronlo V' 

Four Seasons Hotels/ The 
luxury cbSfe? ih’ wffldi r Sattffl 
Arabia's Prince Al-Waleed 
recently 'bohght a minority 
Stake, has benefited from a 
strong recovery to tteffrtania- 

. compa- 

■ ny*s third-quarter ' earnings 
' climbed to C$3^m (US$2.toO or 
12 cents a - store,, from 
09398,000, 4M* 2 catatSi a year 
earfleiv . Revennes rose -to 
C$409 Am ftisn C9328Tm. Oper- 
ating Bantings diznbed by 58 
pa: cent toCHASrt; . 

; The yield at Four Seasons 
mid Regent ludds, defined as 


-occupancy multiplied by the 
realised room rate, rose by .17 
per cent Reservations climbed 

• ! by 28 per* rent-in thoiirst nine 
months of this year which, 
according to Four Seasons, 
piomts to finfimr growth ahead. 

- Next year’s performance 
should also he bolstered by 
hew hotels which opened this 
year in Mexico City and Singa- 
pore, and a resort in Palm 
Beach. New properties are dne 
to open over the next 12 
Tt ymthg jn Chjang Mai CThai- 
land), Jakarta and Istanbul - 

Four. Seasons expects its 

- debt, now C$867m; to foil by 
one-third by end-1995, mainly 

- through, asset disposals. 


MefcroGas float to raise $130m 


py OavM PWfeifl ! 
to Buenos Aires ' - 

The'; Argentine government 
experts -to raise 9l80m-$160m 
through the of its remain- 

big 20 pOT cost Stake to Metro- 
Gas. ^he country’s largest gas 
distributor. • - 

:: The internatiotol ■ issue of 
-98^m r class B shares, hetog . 
:imdOTwrftten ’ By ' CfrecDt ’Suisse; 
that; Boston .and co-led by 


Dresdner Bank, Goldman 
Sachs' and Hemwort Benson, 
is to. the process afbookbmld- 
ingand is expected to be priced 
at between $180 and 9L60 per 
share early next week. 

Demand for toe issue is said 
to be strong, as existing share- 
holders are expected to raise 
their stakes to the British Gas- 
operated utility. British Gas 
has a 41 per cent inte res t to 
MetroGasi • " 


- sfi v 


Stendard Chartered PLC 

US$400,000,000 Undated Primary 
Capital Floating Rate Notes 

’ J ln”uccQrdanc© wifii th 0 . provfeioos .of ttre Notes, 
fwtfc© is he re bygiven that for the Interest 
Detarmf nation period from T4th November T994 
i to.,1 _4th December 1994 the: Notes will carry 

annum. - 


tebacest at^rued to-t# Dede«iber 1994 and 
. payable on;i 2tfr January 1995 will araourit-to 
tiS$S2.08 p^r US$ 10,800 i^e a|>d US$520^3 


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other US supercomputer com- 
panies. Thinking Marfrfnga and 
Kendall Square, have ceased 
manufacturing operations. 
Cray said, however, that it 

has “s t r un g tnitimtinma 

of interest” and believes that it 
is dose to receiving its first 
order. “We plan to be able to 
mnTcw -our first delivery by the 
end of the first quarter of 
1995,” said Mr .Charles Breck- 
anridge, executive vice-presi- 
dent of marketing . 


US oil and 
gas side of 
Santa Fe 
Int’l for sale 


By RoWn Aflenln Drtaj and 
Robert Condne In London 

The state-owned Kuwait 
Petroleum Carp yesterday said 
it would sell the US on and gas 
exploration and production 
operations of Santa Fe Interna- 
tional Corp o r a tion, a wholly- 
owned subsidiary. 

Mr Nader Sultan, KPC dep- 
uty chairman, said the US 
operation was “no longer a 
strategic pr io rity" . 

The sale will not affect 
Santa Fe UK’s operations in 
the British sector of the North 
Sea. 

Nor will it Include Santa 
Fe’s extensive international 
drilling operations. 

Santa Fe was one of a series 
of US and European invest- 
ments made by KPC during 
the 1980s under toe chairman- 
ship of sfr^nrh ah Al-Sabah, 
the then oil minister. KPC 
paid 928bn« or 951 a share, for 
Santa Fe in 198L 

Santa Fe lost $28hn between 
1981-90, according to official 
Kuwaiti figures. 

A Kuwaiti parliamentary 
watchdog has charged that the 
acquisition was a “hasty per- 
sonal idea” rather than part of 
a wen thought-out inves t ment 


Allstate shaken by earthquake 

Reducing disaster exposure is a key to earnings, says Richard Waters 


A llstate is 01m of the hot 
potatoes of the US 
insurance business. 
Last year, it made $L3bn of 
profits after tax - equivalent to 
a 19 per cent return on capital 
That is almost unheard of to* 
the US personal pr operty / casu- 
alty insurance industry, where 
premium rates are controlled 
by state regulators. 

Then came the earthquake 
centred in Northridge, Calif- 
ornia. With its 12-13 per cent 
share of the home insurance 
market in southern California, 
Allstate was hit hard by Janu- 
ary's earthquake. Tiito atom's, 
the company has revised its 
estimate of losses upwards sev- 
eral times during the year. The 
latest figure is £L3bn. 

All of this makes Allstate, 
based in Northbrook, minais. 
one of the purest stock maiiet 
plays to the US personal prop- 
erty/ casualty business. State 
Farm, its rival with some 20 
per cent of the US homeowners 
and auto insurance market 
(and 91.5bn of losses from 
Northridge) is a mutually 
owned company. Farmers, 
whose concentration on the 
west coast landed it with an 
estimated $L3bn of losses from 
the earthquake, is owned by 
BAT Industries, toe UK-based 
tobacco and financial services 
group. 

Reducing its exposure to nat- 
ural disaster s such as earth- 


quakes and hurricanes is one 
of the keys to future Gainings. 
After taking account of rein- 
surance cover, the .company’s 
Northridge losses amount to 
about 11 per cent of its capital, 
according to Mr Peter Wade, 
associate director of Standard 
& Poor’s, the US rating agency. 
Subjecting the company’s 
balance sheet to various disas- 

AUstate’s shares 
trade on a multiple 
of around 9 times 
earnings before 
catastrophe losses, 
some two points . 
below the average 
insurance group, a 
discount which could 
reflect the 
controlling interest 
of Sears 

ter scenarios suggests that 
about 25 per cent to 30 par cent 
of its capital could be at risk, 
he adds. Allstate is now trying 
to reduce that to below 20 per 
rent — although regulations in 
states such as Florida, which 
limit the ability of insurers to 
stop renewing homeowners’ 
policies, hinder this process. 
The scarcity of reinsurance 


coverage for catastrophe losses 
has also made toe task difficult 
to fleremptigh . 

As long as it is perceived to 
face higher catastrophe risks 
thtp i other insurance groups, 
Allstate is likely to continue to 
trade on a lower price/eamings 
multiple (its shares trade on a 
m ul ti ple of about 9 tfrna q earn- 
ings before catastrophe losses, 

jy^stetn '• 


jScmoKFT-Q^hga, 


some two points below the 
average insurance group)- “To 
some extent, the discount may 
reflect toe controlling interest 
of Sears,” Mr Myron Piccoult, 
an insurance analyst at Oppen- 
heimer, suggested recently. 
However, he added tost the 
catastrophe exposure was the 
bigger concern. 

In the meantime, Allstate 


continues to run one of the 
most effective' sales machines 
to the US insurance business. 
Sears was to toe financial ser- 
vices business long before it 
became fashionable - it estab- 
Bshed the company to 1931 to 
sell auto insurance through its 
catalogues and stores - and 
has turned Allstate into a 
much-admired retailer in its 
own. right The insurance busi- 
ness still bears faHTnadw 
of its origins, with auto poli- 
cies contributing about two 
thirds of premium income from 
toe propaty/casualty business. 
About 15 per cent of the com- 
pany’s total premiums last 
year came from life Insurance.) 

Unlike its rivals, Allstate 
operates through a network of 
agents who sell only Allstate 
policies. These 15,000 agents, 
spread across North America, 
brought In $208bn of premi- 
ums last year. 

For Allstate, like Prudential, 
another insurance group with 
a powerful salesforce, this is 
both a strength and a potential 
weakness. Allstate's agents are 
known for their success in sell- 
ing additional pohdes to exist- 
ing customers. However, a big- 
ger move into the life and 
annuities businesses would 
pose questions about the skills 
of its traditional salesforce. 
Also, the biggest growth area 
of the auto insurance market is 
to direct sales. 




■ --flMUKWYMf 


SK*= 




How does TeleWest currently seek to cut its customers’ call charges by 10 to 15 per cent compared with 
BT* without cutting quality? By taking advantage of the fact that the UK is one of the few countries 
- v \ to encourage cable companies to provide television and telephony over a single network, enabling 

! 'V s n 

us to spread the cost over two income streams. Small wonder that the number of TeleWest's 

telephony customers more than doubled last year. TELEWEST 




'Call nvtoos tacorporat* farat BT price dianoea, «NKtM 29 September 1B84. Savings of *(M$ par cant arc baaad on the 'average' ceil distribution pattern for all United Artists' residential telephony cuatonwrs and are la comparison to 

. BT bsaa istes Actual savings vary according to the mix oF damnation a. time of day and length or colls. 

This advofiiMfnHit is issued by TeleWem Communications pie and has bean approved by Klslnwrt B«nson Limited, a member of The Securities snd Futures Authority Limited, solely for the purpose ot Section 57 of the Financial Services Act 1986. 


'"*r 




FINANCIAL TIMES FRIDAY NOVEMBER 1 1 1994 


INTERNATIONAL COMPANIES AND FINANCE 


Japan’s chemicals groups slip in first half 


By WMUam Dawfdns 
bi Tokyo 

Japan’s 
chemical indus- 
.* try continued 

■*' to suffer from 
. 'i falling prices 
Chomteate _, anri weak 
demand in the first half of this 
year. However, its leading com- 
panies believe costcutting will 
help them lift earning s in the 
current half, an example of 
how lower margin manufactur- 
ing sectors will continue to be 
squeezed even as Japan moves 
into an economic recovery. 

That was the message from 
yesterday’s interim reports 
from three of the leading chem- 
icals groups: Mitsubishi Easel, 
Japan's leading general chemi- 
cals producer; Mitsubishi Pet- 
rochemical, the country’s larg- 
est petrochemicals group: and 


Asahi Chemical, the leading 
maker of synthetic fibres. 

The two Mitsubishi compa- 
nies, which merged last month 
to form Mitsubishi Chemical in 
an attempt to pool costs and 
achieve economies of scale, 
both reported losses in the six 
months to September. Losses 
rose at the petrochemical com- 
pany, while the general chemi- 
cals group swung into the red 
from a profit in the first half of 
last year. 

Asahi only managed to raise 
its recurring profits - before 
extraordinary items and tax - 
by «»iiing securities, a common 
technique used by Japanese 
companies to tide themselves 
through hard times. 

Mitsubishi Chemical is stick- 
ing to its forecast of a com- 
bined YlObn ($102m) recurring 
profit in the full year to M a r ch . 
That compares with a com- 


Interim results to September 1004 (Ybn) 


Sales 

Recurring 

Net 



ptonr 

profit 

MteuMstd Chemical 



1994 

362JS 

-4.782 

-0842 

1993 

345.0 

2.273 

3JSB3 

Est tor yew . 

B66.0 

10.000 


Aeahl Chemical 




1994 

449-4 

' 9.848 

4.392 

1993 

468-4 

8.771 

&240 

Ext tor year 

98010 

24 j 00 Q 

11.000 

Nippon Chemical 




1994 

14.8 

-0303 

2£42 

1993 

1A® 

-0941 

-1.369 

Ext tor year 

31.2 

-OJJ70 

a£90 

-senatorehaylanadta 


Anna: compwiy KWH 


bined loss of Y6.18bn last year, 
composed of a Y2-21bn profit 
from Mitsubishi Raggi and a 
Y8.39bn recurring loss from 
Mitsubishi Petrochemical. The 
merged group forecasts sales of 
Y855bn in its first year, 16 per 


cent down on its partners' 
combined Yl,Q23bn in 1993. 

The new group's petrochemi- 
cal arm is hoping that it will 
be able to pass on a rise in oil 
prices to an increase in prod- 
uct prices in the current half. 


The bulk chemicals division is 
counting on a recovery in pro- 
duction, after having to reduce 
output during Japan's summer 
water shortage. Both expect to 
benefit from the cost savings 
achieved by reducing their 
combined number of divisions. 

Asahi yesterday upgraded its 
sales forecast for the full year, 
by Y20bn to YSSObn, a 4.6 per 
cent rise on the 12 months to 
last March. It made a Y3Bbn 
capital gain on securities to 
achieve its recurring profit of 
Y9.65bn in the first halt a 10 
per cent increase on the same 
period last year. But operating 
profits fell, by 5.8 per cent to 
Y9-8bn. on sales down by L5 
per cent Demand for textiles 
and synthetic resins was espe- 
cially weak, said the company. 

The smaller Nippon Chemi- 
cal cut recurring profits to 
Y303m from Y941m a year ago. 


Challenge 
Bank says 
it will bid 
for rival 


By Nikki Tait 
in Sydney 

Perth-based Challenge Bank, 
the Australian regional bank, 
said yesterday that it intended 
to make an offer for Bank- 
West, a significantly larger, 
state-owned bank which the 
Western Australia government 
plans to privatise next year. 

Challenge said it was confi- 
dent Its bid would be about 
AJIOOm (US$75.56m) more 
than the state government 
would receive from a public 
float of the company. How- 
ever, Challenge made no men- 
tion of the specific offer it 
would make. 

Challenge, whose desire to 
acquire BankWest has been 
widely known, said the com- 
bined strength of the two 
organisations in terms of mar- 
ket position, profitability and 
funding would maximise the 
prospect of BankWest remain- 
ing permanently domiciled in 
Western Australia. 

"The merged entity can be 
funded, at the outset and over 
time, through a planned ami 
systematic programme of 
accessing the domestic and 
international debt markets,” it 
said. 

Challenge Bank is estimated 
to have a 9 per cent share of 
the WA market, with a loan 
book around AS2bn. BankWest 
is larger, with 27.6 per cent of 
the market and a loan bock of 
more than Agfibn. BankWesfs 
gross assets are around 
AS12^bn, while Challenge has 
ASSbn, according to its 1993-94 
balance sheet 

BankWest said: u lt [Chal- 
lenge] has failed to spell out 
how it wonld Implement a 
merger. In contrast, a straight 
float ensures that the full ben- 
efits of privatisation would go 
to the people of WA." 

Meanwhile, the state govern- 
ment said It would not be pres- 
sured on the privatisation of 
BankWest 


Inco digs deep to squeeze costs 

The nickel producer is celebrating rising prices, writes Bernard Simon 


W hat a difference a 
year has made at 
Inco. Twelve months 
ago, the western world's big- 
gest nickel producer was trim- 
ming its sails to cope with 
what looked like an unremit- 
ting market slump. 

Inco produced 15,000 tonnes, 
or about 8 per cent, less nickel 
last year than in 1392. As the 
nickel price dipped to a low of 
USS1.80 a lb In September 1993, 
it cut output by another 18,000 
tonnes and pared capital 
spending to the bone. Some 
feared the Toronto-based com- 
pany, which supplies about a 
third of western nickel output, 
might buckle under its JLlbn 
debt burden. 

The mood was just the oppo- 
site at Inco's board meeting in 
the last week of October. The 
three-month nickel price had 
climbed to more than S3 a lb, 
hitting a peak of S3.45 last 
week. The directors were suffi- 
ciently confident of the outlook 
to approve a clutch of new pro- 
jects at its Ontario and Mani- 
toba mines. 

They include the S158m 
development of the McCreedy 
East deposit, near Sudbury, 
Ontario, which is expected to 
produce 22Jm lbs of nickel 
(equal to about 6 per cent of 
1993 output} and 77.5m lbs of 
copper a year by 1999. 

In addition Inco has just 
given the go-ahead far a dril- 
ling programme at what is 
believed to be a rich orebody, 
known as Pipe Deep, in Mani- 
toba. It Is also pressing ahead 
with development of another 
high-grade orebody, known as 
Victor, near its existing 
operations at Sudbury. 

Plans have been unveiled to 
install a 313.6m ore-handling 
system as a prelude to deepen- 
ing the Creighton mine at 
Sudbury. . 

“It’s our intention to get 
every pound of nickel possible 
out of the ground." an Inco 
official says. Another "good 
news” announcement, on 
which the company declines to 
elaborate at this stage. Is 
scheduled for early next week. 


Inco rides high on nickel price 


Net earrfngs/kwses |Sm) 
800 


A LME 3-month metal (Sflb) 
* - 9.0 



-100 1 

1984 85 88 87 

Sourca: Company • 

The turnround has begun to 
show in Inco's earnings. Pri- 
mary metal operations have 
swung from a 319m loss in the 
third quarter of 1993 to a $39m 
profit this year, in spite of an 
accident at a Manitoba mine 
which cut third-quarter output 
by 3,600 tonnes. 

The median forecast of a 
group of 13 North American 
analysts suggests that Inco will 


89 90 91 92 93 94* 

* firat nhw months 

less steel production by 5 per 
cent to 12.6m tonnes. 

As a result, its estimate of 
nickel demand has climbed by 
18,000 tonnes to 711.000 tonnes. 

Inca predicts a similar rise in 
western supplies during 1995, 
reflecting the return of moth- 
balled mines to the market, 
and new capacity in western 
Australia and Indonesia. 

This would bring the market 


The company says that it intends 
to get every pound of nickel 
possible out of the ground 


recover from a loss of about 40 
cents a share this year to earn- 
ings of 3L50 a share in 1995. 
Those looking further ahead 
bravely predict earnings will 
climb to about 32^ in 1996. 

Mr Peter Marcus, analyst at 
PaineWebber in New York, is 
increasingly confident that his 
“good case” scenario of an 
average 1995 nickel price of 
35 a lb wifi be realised. 

M uch of the renewed 
optimism rests on 
unexpectedly buoy- 
ant demand from stainless 
steel makers, who make up 
about 60 per cent of western 
nickel consumption. Inco Has 
raised its forecast of 1994 staln- 


roughly into balance. Mr 
Fraser Phillips, analyst at 
ScotiaMcLeod in Toronto, pre- 
dicts that while a price correc- 
tion could occur over the next 
six months, inventories should 
start dropping in late 1995 and 
prices should then improve 
sharply. 

This optimistic view of nick- 
el's prospects hinges on stag- 
nant, or falling, Russian 
exports. Uncontrolled ship- 
ments from Russia and eastern 
Europe have been one of 
the most disruptive forces in 
the nickel market in recent 
years. 

Ms Stephanie Anderson, Inco 
director of market research, 
said in a recent papa* that Rus- 


sian deliveries to the west 
would be “the swing factor 
that dictates the direction 
nickel prices take in the 
future". 

Supplies from former com- 
munist countries are expected 
to be about 126,000 tonnes this 
year, or 18 per cent of world- 
wide nickel supplies. 

According to Ms Anderson, 
Norilsk, the main Russian pro- 
ducer, cannot sustain its out- 
put without investment and 
regular maintenance to mine 
and plant equipment. “Based 
on a lack of capital spending 
alone, not to mention the 
social and political problems, 
production at Norilsk could 
well fall,” she said. 

But she also acknowledged 
that “it is almost impossible to 
quantify what is really happen- 
ing to [the Russian] industry". 

N o matter what hap- 
pens, Inco hopes to 
benefit from its drive 
over the past three years to cut 
costs, especially at its Cana- 
dian operations. According to 
Mr Marcus, break-even costs 
may be down to 32-25 a lb 
within the next few years. Unit 
costs in the early 1990s were 
around 32.45 a lb. 

The nickel market has 
become increasingly volatile as 
h anks and investment funds 
have emerged as important 
forces. The daily open interest 
on the London Metal Exchange 
- that is, the number of con- 
tracts which have not been 
closed off by metal deliveries - 
has soared from 48,000 tonnes 
In 1990 to around 340,000 
tonnes. Trading volumes have 
surged fivefold to 70,000 tonnes 
a day. 

Mr Marcus at PaineWebber 
estimates Inco’s earnings a 
share rise or foil by 32 for each 
31 movement In nickel prices. 

For the time being, volatile 
markets are working to the 
advantage of producers. But 
Inco’s ability to weather future 
downturns is likely to hang on 
its success in maintaining the 
costs squeeze, even as it cele- 
brates rising metal prices. 


NEWS DIGEST 

Rhdne-Poulenc 
and Akzo Nobel 
call off talks 

Akzo Nobel, the Dutch chemicals group, and 
France's Rhdne-Poulenc said yesterday they 
were suspending fe*nes on cresting a joint ven- 
ture for the production of soda ash because 
they could not agree on the ownership of the 
new company, writes Ronald van de Krai in 

Amste r dam 

As part of plans unveiled In late May, 
Rhdne-Poulenc, the world's third-largest soda 
ash producer, was to have held 67 per amt of 
the joint venture, with Akzo Nobel owning the 
rest 

In later negotiations, both sides wanted a 
larger stake, and the gap between the two 
could not be bridged. However, Akzo Nobel 
and Rhfrae-Poulenc held out the possibility 
yesterday that talks might be resumed later 
because the frmftis tr j ai logic between the part- 
nership in soda «5h remained intact 

The planned joint venture, originally sched- 
uled to get under way in January, was to have 
had annual turnover equivalent to FI 300m 
($175m) and a workforce of more than 600. 

Rhdne-Poulenc was p lanning to contribute 
its plant in Nancy, France, while Akzo Nobel 
was prepared to transfer ownership of its 
production site in Del fail I, in the Nether- 
lands. 

Anti-cholesterol drug 
sales lift Sankyo 

Sankyo, a leading Japanese pharmaceuticals 
company, pasted a firm rise in earn in gs due to 
strong sales of its anti-cholesterol drug Meval- 
otin, writes Emiko Terazono in Tokyo. 

The company posted an 8.4 per cent rise in 
recurring profits - before extraordinary items 
and tax - to Y43bn ($439m) in spite of a 2 per 
cent decline in sales to Y2t&2bn. 

The fall in sales was brought about by cuts 
in official drug prices by the ministry of h ealth 
and welfare, and the transfer of sales rights of 
7-ariitpn , an asthma drug, to the Japanese arm 
of Sandoz, the Swiss pharmaceutical group. 

The company posted a 5.6 per cent rise in 
operating profits to Y423bn and an 1L2 per 
cent increase in after-tax profits to Y19J2bn. 
Sales of its drug division fell LS per cent to 
YISaTbn although Mevalotm and Loxmune, an 
analgesic drug developed by Sankyo, saw sales 
increases. Revenue from agrochemicals sales 
fell 0 £ per cent to Y12bn. 

For the full year to March, the company 
expects current pro fi ts to rise 3.4 per cent to 
Y83bn while sales are expected to remain flat 
at Y396ton. 

First-quarter surge 
for Wesfarmers 

Wesfarmers, the Australian fertiliser, chemi- 
cals and coal group, yesterday said it was 
budgeting for an improved profit after tax and 
before abnormal items for the year to June 30 
1995, after posting a 70.9 per cent rise in 
first-quarter net profit, Reuter reports from 
Perth. 

The company reported a net profit of 
AS3L4Gm (USS23.72m) for the three months to 
September 30, compared with A31838m in the 
199394 first quarter. Results were boosted by 
abnormal p ro fi t s of A$12L92m on the sale of 
Investments. Sales rase to A$530.15m in the 
quarter, from AS443.37m a year earlier. 

WpgfarmpTti repeated a net profit after tax 
and before abnormal items of A3 127.02m for 
the 199394 year. 

Highlands Gold shares 
worth A$38m sold 

Stockbroker County NatWest said it had com- 
pleted transactions totalling 28m shares, or 5 
per cent, in Papua New Guinea gold miner 
Highlands Gold at A31.38 a share. Renter 
reports from Sydney. The broker would not, 
however, disclose the buyer or the seller 


of the Fighiauds shares, which were -watt 
A$38.64m (USJSSJJm). . ■ ' -V;- . ::: V- 
MTM Holdings, the Queenslandhasedmetate 
group which owns 65 percent pf EHghtekfa, 
said- it was not behind .the tr ansacfl onUMHt 
sold most of Its equity Investments aver 
the past 12 months as part of a strategy of 

putting all assets under review. 

Highlands shares closed 3 cents lower at 
A31.45, on a turnover of 29.03m, an the Austin- 
dan Stock Exchange. • ’ 

SXA moves ticket data 
unit to China 

Singapore Airlines (SIA) Is to move part of its 
accounting operation to China to cut costs and 
circumvent labour shortages in BtugeqwreL SA 
said the state owned accounting centre of 
fihina aviation would process SIA ticket data,' 
writes Koran Cooke in Kuala Lumpur. - 
“Given the shortage of labour to Singapore^ 
this will lessen the problem of recruftmenf and 
also result In cost savings for SIA," the airfine^ 
said SIA Is in. the process of moving after 
back room operations to India and other low- 
cost cadres. It has also taken a stake in ‘aft 
aircraft maintenance facility being buffi Id 
nWna . 

SIA is concerned that growing labour rad 
associated costs at home plus the coatinaiiig' 


Share price $0$; 


strength of the Singapore dollar are .threat®- ; 
tog the airline's competitiveness. Last month 
SIA reported a 20 percent rite in group operat? 
ing profits of S$478m (3322m) for the half year 
to September. -• _ -:-r‘ 

Cascades back in profit 
at nine months 

Cascades, the Cankifl.: 
an-based international 
packaging group- 
returned to profltabfr. 
ity at the mnomonth 
stage with strengftra- 
ing markets and-cdoK 
pletion of a lestrociutv 
ing of its Cascades 
Paperboard business hi. 
North America and 
Europe, writes Robert 
Gib bens in Montreal. 
Net profit was C3l5m 
(US31U)8ni) t or IT. 
cents a share, against a - 
net loss of.C342m, or 17 cents, a year earlier 
on sales of C$1 -2bn, down slightly because of 
the sale of Paperboard assets and shutdown of 
the Duffel min in Belgiuzn- 
Third-quarter profit was C$7-3m, or 10 cents, 
against a loss of CgSJhn, or 9 cents, on sales of 
c$422m a gainst C$40Qm. 

Cascades has delayed makmg a provision for 
a C$208m fine levied against its French sub-, 
sidiary after a European Commission probe of 
alleged boxboard industry price-fixing. Cas- 
cades has appealed and said it believed the 
fine would be reduced. 



1893 \u- 

SornKteuAMi 


EDS buys New Zealand 
state computer group 

EDS, the US computer services subsidiary of 
General Motors, has paid NZ$47m (US$29.2Sm), 
22 per cent over book value, for GCS, the New 
Zealand state-owned computer group which 
handles record keeping for police, health, reve- 
nue and other government departments, 
writes Terry Hall in Wellington. 

This is the second large purchase by EDS in 
New Zeeland in less than six months. The 
company, founded by one-time US presidential 
candidate Mr Ross Perot, paid an estimated 
NZglOQm in May for Databank, a company that 
handles cheque clearing and related transac- 
tions for the country's banks. 

GCS, previously known as Government 
Computer Services, was set up in the late 
1960s, and was the biggest locally owned com- 
puter company. GCS made a tax-paid profit of 
NZ$L5m in the six months to September 30. R 
has earned NZ$52m in profits over the past 
five years. 



D 

O 

N 

. 

T 

C 

R 

A 

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■J 

N 

D 

E 

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PR 

F. 

SS 

A R 

E 



Indonesian plans HK newspaper stake 


By Sfanon Holbeitcjn 
In Hong Kong 

Indonesian tycoon Mr Oei 
Hong-leong has emerged as an 
Investor in Ming Pao, the pres- 
tige Hong Kong daily newspa- 
per whose chairman was 
forced to resign last month 
amid revelations concerning a 
past criminal conviction. 

Mr Oei’s China Strategic 
Holdings will buy a 10 per cent 
stake in Ming Pao from CIM, 
the newspaper’s controlling 
shareholder, to a deal valued 
at about HK$200m (US$25-87m). 

Mr Yu Pun-hoi. Ming Pao for- 


mer chairman end p-hahnu m of 
CIM, said CIM had no Interest 
in disposing of its controlling 
Interest in Ming Pao. A 10 per 
cent stake would be disposed 
of in two tranches of 18m 
shares each over the coming 
three months and would leave 
CIM still owning 50 per cent of 
the company. 

Since Mr Yu’s resignation 
last month, in response to the 
censure by the Hong Kong 
Stock Exchange over his fail- 
ure to declare a 1979 criminal 
conviction, the Hong Kong 
market has been awash with 
rumour and speculation about 


CfoTs continued ownership of 
Ming Pao. 

Mr Robert Kuok, the Malay- 
sian financier, and Mr Jimmy 
Lai, the publisher of Next mag- 
azine, were rumoured to have 
been interested in acquiring an 
interest in Ming Pao. In the 
end it was Mr Oei - whose 
family controls Sin&r Mas, 
Indonesia's second largest 
business empire - who 
emerged in the lead. 

In addition to his private 
interest in Indonesia, Mr Oei is 
a big investor in property in 
Singapore, where he has made 
his home. In Hong Kong, he is 


chairma n of China Strategic 
which is his family’s vehicle 
for investment in China 
. The company has many joint 
ventures in China but most of 
its profits come from three 
areas of activity: it is China’s 
biggest tyre manufacturer, it 
produces about 10 per cent of 
the country’s output erf paper, 
and it owns five breweries. 

A year ago Mr Oei joined a 
consortium of Asian business- 
men who paid US$lQm for a 70 
per cent interest in Myanmar 
International Airways - the 
flag carrier of Myanmar {for- 
merly Burma). 


THE JAPANESE WARRANT FUND 

SoeiGte dTnresUaoreijient 
4£ to ties SdlLu, L-2S29 HonU 
Ccmd Duchy of Lnxembmus 
an Lmcmbmng No. D31 £29 

Aa the fiat Exiraordinaiy General Meeting held on 27 October 1994 did not have the 
rtqutai d quorum of ona half of the dares outstanding, the Sharehotfal are hereby 
convened Id the 

SECOND EXTRAORDINARY GENERAL MEETING 
tabe held at the European Beak fc Business Centre, 6, route de Trtrca, H633 
SenwpgwfaCTR Grand Duchy of Ltme m b uuig on 21 December 1994 at 10 ml with the 
following agenda: 

1- ReetnicStiring of die qph al of tfae Corporation and consequent of 

the Artldeo % 7 and 23 of the Articles (ttAssodatkav 

3. Authorisation to the Board of Director* to act-off all realised and unrealised 
capital losses zemded in the amounts as at 30 September 1993 ogatast the pald-m 
nuplns in accordance with the provision of Article 21 of the Articles of 
Assoaotkxc 

1 ly 0 * 9 . 0 * ‘hgapyhnentof Article 4 of the Artfcteaof AasodaBon consequential to 
Jhecharw | of the retfotered office from 4& roe des Scfflaa, WS» Howdd, Grind 

The Shareholders are advtsed that no quorum fa required for the hoUlne of this 

he ent itled 1 ° attend tfae meeting, holders of bearer shares must deposit 
ffr * 56 " 18 * wot * !il W l^for to »he meeting with any of the 

CatiqueetCatssedT^MiigiiederEtaras Hni ode a rDyosltary 

personally attend foe meeting ate requested to uae the 
wa n ot pro y and return tt at leasts working days prior to the date of the 
laenemi Meeting to tfae Corporation, c/o Fleming Fund Management 


Co fflna 
SbmUijt 


LEGAL 

NOTICE 


nu 


caANcntr ntvrstnw 

(N TOE MATTER OF 
REALLY USEFUL HOLDINGS LIMCTfiD 
AND 

IN THE MATTER OF 
THE COMPANDS ACT IMS 
NOTICE IS HEREBY CHV13N Ore dn Order of 
the High Ooun of Iwdce (Chum? DMsloq) 
dated 2 November 1994 conflrmiag the 
nadnedou of tfare capital of the above-named 
Orepeoy from £16404000 to XUHUH0 aad 
the Mimas ajapmed by dw Caen sbowtag »kh 
■eqms U tbs capital of lbs aaq ma f a atfarad 
the aevenl paitkolam nqahcd by dm abort; 


■ 1 Act were r e gi g ensl by Urn Rsgbmr 

of Cbmpaaka on 4* November 1994. 

DATED the Ukh day of November 1994 

NUbsera NMbaoisa 

30 Stmttaa Street 

Louden 

WIX 5FL 

Tel: 071 493 9933 

Ref IA/G17KUUIS 

SoUdtos fix Ac ftflioMg Cb m pfi uy 


To Advertise Your 
Legal Notices 

Piease contact 
Tina McGorman 
on +44 71 873 4842 
Fax: +44 71 873 3064 


FLEMING FLAGSHIP PORTFOLIO FUND 
Socf£f6«riaMetfcxnenf 

45, roe dee ScStae 
Lr2529 HownU 
Grand Duchy erf Luxembourg 
RC. Lananbaarg NaJI3925t 

quareai of one half of foe shares euttmeUng, the SharcfaoUen « hereby oogieaod tofoa 
SECOND EXTRAORDINARY GENERAL MEETING 

, L-2633 


! Of Article) 4 of die Aitides of Aatocfatiem coeescameatU to lb 

: from 45, me dea SdOas, L-2529 Kbnald, Grand Duchy of Lmemboos to 

, 6, nmte ele THves, L-2633 Scomogciheig, Grand Duchy 




By Older enf The Board of Directors 
Many C Kelly 
Secretary 



Bank completes 
HK$2.5bn issue 

Standard Chartered Bank, toe 
operating bank of UK multina- 
tional hawk in g group St a n d ard 
Chartered, said yesterday that 
it had completed a HK$2.5bn - 
(US$32.5m) issue of Boating T 
rate certificates of deposit 
aimed at lowering the cost of u 
funding its assets in Asia, 1 
writes Sinion Holberton. 

The bank said it had nearly 
doubted the issue in response 
to market demand 

The FRCDs will pay an 
annual rate of interest equiva- 
lent to 35 basis points above 
the three-month Hong Kong 
Interbank offered rate. 


1 1 









.-'-f . 


■ K 




-5-. 


Az. 


■ -■>. 


^ tic 

hina 


ket 


data 


•-r 


«2 “ proft 


\ 






s V-w Zealai 
ipater group 


Blink compj# 


_ l, ’C. 




, V 


■.■5!' 


•3^ 




I 




FINANCIAL TIMES FRIDAY NOVEMBER 1 1 1994 


21 


INTERNATIONAL CAPITAL MARKETS 


US Treasuries encouraged by inflation figures 


By Conner Middefrnann in 
London and Lisa Bransten In 
New York 


US Treasury prices rose 
sharply yesterday morning 
after government figures on 
producer prices indicated a 
possible slowdown in inflation- 
ary pressures where econo- 
mists had predicted an 
increase. 

By midday, the benchmark 
30-year government bond was 
UP $ at 93g, yielding &052 per 
cent At the short end of the 
mariut; the two-year note was 
up & at 99£, to yield &8T7 per 
cent. 

Sparking the price gai n * ? was 
a labour department report 
that showed producer prices 
down QJ5 per cent for October, 
the same as In September. 
Most analysts had predicted 


that October prices would 
increase 0.1 per cent 
"I think it is very good as Ear 
as inflation is concerned, but it 
is not the end of the story,” 
said Ms Marilyn Schaja, a 
money market economist at 
brokerage Donaldson, Lufkin & 
Jenrette. hr spite of the figures, 
she maintained her opinion 


GOVERNMENT 

BONDS 


that the Federal Reserve was 
likely to raise its interest rate 
target by 50 basis points next 
week at its open market com- 
mittee meeting. However, she 
said the inflation, news lowered 
the chance that the Fed would 
move to raise rates by as much 
as 100 points. 

A strong showing by the dol- 


lar added to positive sentiment 
in the bond markets. In early 
trading, the dollar pushed up 
to Y98.06 against the Japanese 
yen and DML536 against the 
D-Mark. 

Europe’s bond markets once 
again took their cues from 
Treasuries, and most of them 
posted moderate gains on the 
back of the US bond market’s 
rise. However, turnover 
remained thin as market par- 
ticipants remained reluctant to 
increase their exposure ahead 
Of Tuesday's FOMC meeting . 


As expected, the Bundes- 
bank's central bank council 
left official interest rates 
unchanged at yesterday’s 
meeting and set another two 
rounds of securities repurchase 
agreements at a fixed rate of 
485 per cent. 


2 Vi per cent index-linked stock 
due 2024 and a £250m tranche 
of 8% per cent stock due 2017 
have not been sold out 


■ German bonds rose about % 
point in moderate volume hi 
largely technical dealings. The 
December bund futures con- 
tract on DTB ended at 90.31, 
0.33 point on the day, but 
drifted lower in after-hours 
trading on Uffe. 


■ UK gilts had a lacklustre 
session, dosing slightly lower 
as the Bank of England’s tap 
issues kept a lid on prices. The 
December long gilt future 
closed around 101j&, down Vi 
point 

A £2S0m tranche of 8% per 
cent gilt due 2006, one of four 
tap stocks annmmrpt} on Fri- 
day. was exhausted in the 
afternoon, the Bank said. A 
£100m tranche of 2V4 per cent 
index-linked bonds due 2009 
was exhausted on Wednesday. 
The others, a £10Qm tranche of 


■ French bonds underper- 
formed bunds, with their yield 
premium widening to 75 basis 
points from 69 on Wednesday. 
In addition to position-squar- 
ing ahead of today's national 
holiday, the weak franc 
weighed on bonds, dealers said. 

Although the market is 
likely to come under further 
pressure amid uncertainty over 
the May presidential elections, 
Mr Adrian James, bond market 
strategist at NatWest Markets 
recommends buying French 
bonds on weakness. However, 
“you've got to be prepared to 
take a six-month view to see 
value in the French market," 
he warned. 


■ Swedish bonds had another 
strong day, lifted by a poll 
indicating that the supporters 
of European Union member- 
ship might hold a majority 
after all. The yield on the 
benchmark 11-year bond fell 23 
baas points to 11.20 per cent 

With a large pool of voters 
still allegedly undecided, the 
outcome of Sunday’s referen- 
dum remains unclear. 

The markets still appear to 
be slightly biased towards a 
“yes" and are likely to experi- 
ence only a brief rally should it 
materialise. 

However, a “no” could pot 
heavy pressure on Sweden’s 
currency and bonds. 

Traders said Sweden's yield 
spread over bunds could return 
to this year's high of around 
500 basis points, from 376 at 
present 


Borrowers continue issuance with short maturities 


By Martin Brice 


The euromarkets saw a small 
number of issues yesterday, 
mainly with a short maturity 
and targeted at retail inves- 
tors, although some syndicate 
managers reported large pur- 
chases by institutions. 

Issuance is expected to 
decline until after the Federal 
Open Market Committee meet- 
ing on Tuesday. Syndicate 
managers suggested ' the 
Republic of Italy might wait to 
see the impact of the FOMC 
meeting on US interest rates 
before issuing its long-awaited 
Y400bn bond, which could 
come in three tranches; a 
three-year, a 20-year, and a 
tranche of between six and 10 
years. 

In the US dollar sector, the 
largest deal yesterday was the 
Republic of Austria, which 
brought a 2200m bond via Leh- 
man Brothers, which said the 
strong name had stimulated 
very strong European retail 
demand. “Fve had syndicate 


managers coming out of the 
woodwork trying to get into 
this deal," said a Lehman ofB- 
ciaL 

Norddentsche Landes bank 
brought a 5150m bond via Pari- 
bas Capital Markets, which 
said the offering had been 
greeted wtth solid ifamawi in 
Switzerland and Belgium, as 


INTERNATIONAL 

BONDS 


well as Germany and south- 
east Asia. Some UK institu- 
tions had bought the bonds, 
which were given a 13-month 
first coupon to help the bor- 
rower effect a swap. 

The first Argentine corporate 
borrower since the Republic of 
Argentina brought its |500m 
global deal last month braved 
the euromarkets yesterday. 
Yesterday’s bond came from 
Astra Compania Argentina de 
Petrolic, the Argentine ofl and 
gas group which has been 
listed on the stock market in 


Switzerland for 70 years, via 
Swiss Bank Corporation which 
reported strong demand, some 
of it from US institutions. The 
bonds came at 412 basis points 
over US Treasuries. The 
Republic’s bonds were brought 
to market at a spread of 
around 350 basis points over 
US Treasury bonds, and by 
yesterday had widened out to 
around 366 basis points over. 

Banco National, the Brazil- 
ian bank, brought an 580m 
bond via Citibank which tar- 
geted the offering at retail 
Swiss, US, Latin American and 
Asian investors. The deal had 
been talked about as a $75m 
bond but was increased to 
580m. When freed to trade, the 
bands tightened by one basis 
point. 

Two issuers each brought 
£10Qm sterling deals. Portman 
Building Society, the UK’s 14th 
largest, via BZW which said 
the deal offered an alternative 
to expensive paper in the sec- 
ondary marfrpt- 

Landesbank Schleswig-Hol- 



NEW INTERNATIONAL BOND ISSUES 


Amount 

Coupon 

Price 

Matufly 

Few 

Spread Book newer 

Borrower 

US DOLLARS 

m. 

H 


% 

bp 


ftepiibflc rt Au«M*a) 

200 

7J25 

700R 

dan. 199 7 

Q.125R 

+8 (S5494 -96) Lehman Bras, tntt 

Nortkteutsche Landeobartc 

150 

7JS 

9179R 

Dec-7996 

0.1 75R 

+20 (0»9fc-9Q Paribas Capital Mkts. 

Astra Argertlna de Patrafa 

100 

11B264 

09.02SR 

Dec. 1969 

0.675R 

+412CTAH-09) SBC 

Rabobank Nederfaid^ 

100 

4.00 

100R 

Deal 997 

0.1 B8R 

• Morgan Stanley intL 

Banco Nactanal 

BO 

11JM 

81612R 

Nov. 1897 

- 

+385(7%%-Q7)Catbenk IntL 

STBOWO 

LB Schle»w4g44o4stdn 

TOO 

8.0 

88.737R 

Dec. 19M 

aisn 

+25 (10% -9® HSBC Markets 

Portman B/StWT 

100 

w 

99.85R 

Dec 199 7 

ai2sn 

BZW 

CANADIAN DOLLARS 

Bk. Nedertanctaa Oemoantan 

150 

8.0 

100.176R 

Dec 1896 

1126R 

+10 (71498-96) ScsdaMctood 

AUSTRALIAN DOLLARS 

ABN Amro Australia 

100 

10.125 

101 -41 

Dec-1997 

1.50 

+15 W ABN Amro 

Cotnd ol Euopo 

100 

SU325 

101.06 

Dec. 1996 

1.25 

• BZW 

SWISS FRANCS 

European investment Bk. 

200 

5.625 

102.75 

Dec-2002 


sac Zurich 

cay ot Vienna 

200 

5J75 

1C2B5 

OeafS87 

- 

- Cmcft Sufase 

FW terms and non-caflcrisla taileH stated. The yield spread (over relevant government bond) at launch is ajrpied by Me lead 
manager. *Ur4sted. SConverttrie. $Wttt> eqtey «varrent& jfloretng rate noia. iSeinkmuai coupon, ft Axed m-oRer price; fees ere 

shown at the r» -otter fmeL a) Long fit® coupon, b) Coupon pays 3 month Ubor * 12-Sbp. Celatris in Dec 1996 at par. c) Oner I 

Interpoiated yWd. 









stein brought a £100m bond 
through HSBC Markets, which 
reported strong demand with 
blocks of £5m and £7m being 
sold to Institutions attracted 
by the highly-rated name. 

In the Australian dollar sec- 


tor, ABM Amro Australia 
brought a A$100m bond 
through ABM Amro, which 
reported strong demand with 
one block of A525m going to a 
buyer in the Netherlands. The 
Connell of Europe issued a 


ASlOQm bond through BZW. 

Syndicates are expecting the 
first convertible bond to 
emerge from Brazil this month. 
it is expected to be a $100m 
issue with a 10-year maturity 
from a highly-rated company. 


Russian chocolate 
maker raises $30m 


By Richard Lapper 


International investors are to 
be offered the opportunity to 
invest directly in Krasny 
Oktyabr (Red October), the 
profitable Russian chocolate 
maker. 

A public offer scheduled to 
take place later this month in 
three Russian cities was open 
to local investors and foreign- 
ers, said Mr Richard Oliver, 
associate director with Samuel 
Montagu, one of the western 
firms involved. 

The project, sponsored by 
the British government's Know 
How fund and the Russian 
Securities and Exchange Com- 
mission, aims to raise up to 
$30m through the offer to be 
launched in Moscow, St Peters- 
burg and Ekaterinburg. About 
56 per cent of the company's 
shares are being sold priced at 
Rbs20,000 each. 

About 20 per cent of the 


shares are to be set aside for 
strategic investors, such as 
western companies with an 
interest in the foods sector. 
But the issue will be taigeted 
at a wide range of investors, 
but we want to get “retail 
investors involved,” said Mr 
Oliver. 

A number of specialist Rus- 
sian funds, formed over the 
past 18 months, are expected to 
take some of the equity. These 
have been the most popular 
means of investing although 
earlier this month interna- 
tional trading began In the 
shares of RSNG, the large oil 
and gas construction company, 
following the successful place- 
ment of about 525m of paper 
with international investors. 

Mr Oliver said Krasny’s 
smaller and well-defined busi- 
ness was much easier to value 
than the large energy- and oil- 
related concerns interesting 
western investors. 


IFC guarantees 
Russian facility 
for first time 


By Richard Lappor 


The international Finance 
Corporation yesterday 
approved a guarantee of up to 
510m for the Russian Trade 
Enhancement Facility, a new 
facility that win partially guar- 
antee the credit risk of Russian 
banks engaged (n trade 
finance. 

The facility, the first of its 
type to be supported by the 
International Finance Corpora- 
tion is expected to guarantee 
up to S2.4bn of Russian 
trade. 

ABN AMRO, the Dutch 
bank, is co-guaranteeing the 
facility and will matrh , dollar 

for dollar, the corporation's 
exposure on each transaction. 


FT- Actuaries 
Fixed Interest 
Indices 


The FT-Actnaries Fixed 
Interest Indices Committee 
has decided to cease the calcu- 
lation and publication of the 
Debenture and Unsecured 
Loan Stock Index from Decem- 
ber 31 1994. The main reason 
for this decision is that 
changes in the structure of the 
market have reduced the num- 
ber of liquid stocks with an 
adequate range of maturity 
dates. The committee feels as a 
result that the integrity of the 
Debenture and Unsecured 
Loan Stock Index can no lon- 
ger be guaranteed. 

Investors in debenture and 
unsecured loan stocks will 
find a variety of indices of tfris 
sector of the market calculated 
by leading market makers. 


1 WORLD BOND PRICES j 

BENCHMARK GOVERNMENT BONDS 

Red Day's Week Month 

Corexn Dato Price change Yield ago ago 

Italy 

■ NOTIONAL ITALIAN GOVT. BOND (BTP) FUTURES 

PJFFQ* Urn 200m lOOths ot 100% 

FT- ACTUARIES FIXED INTEREST INDICES 

Price tadcee Thur Day’s Wed At»ued 

UK OBta Nov 10 change % Nov B tntareat 

xd adL 

yw 

— Low coupon yWd Metan camanyWd tflgh cotpan yield — 

Nov 10 Nov 9 Yr. ago Nov 10 Nov 9 Yr. ago Nov 10 Nov 9 Yr. mo 


Amtialn 

1000 

09104 

904000 

+0220 

1059 

1057 

1020 


Open Sen price 

Change 

Kgh 

Low 

EsL vd 

Open Int 

Belgkrei 

7.750 

10AM 

96M400 

+1190 

829 

&£6 

£31 

Dec 

101.05 101.44 

+027 

101.58 

10090 

3614 8 

52686 

Canada* 

BlSOO 

06104 

815500 

+0200 

9.12 

118 

822 

Mar 

10020 10028 

+027 

10030 

9920 

300 

9137 

Denmark 

7.000 

12AM 

87.6000 

+0250 

821 

924 

822 


France STAN 

BlOOO 

05/B8 

101^760 

+0200 

7 AT 

724 

7.48 








OAT 

6.600 

04AM 

6&0100 

+0230 

8.14 

£35 

726 

■ ITALIAN GOVT. BOM) (BTP) FUTURES OPTIONS QJFFB L4ra200m 100th« of 10096 

Germany Tteu 

7-300 

01104 

100.1800 

+0220 

7A7 

724 

743 

— — 



— 




Italy 

8.500 

08AM 

822400 

+0.450 11-59T 

1120 

1124 

Strike 

Price 

' Dec 

Mar 


Dec 

PUTS " 


Japan ” NollB 

<Laoa 

009 1 

1827740 

+0.040 

428 

426 

4.18 



Mar 

Japan No 184 

. 4.100 

12/03 

152880 

+0.160 

4.75 

428 

4.79 

10100 

0.94 

120 


050 


2.68 

Nethariends 

723} 

10/04 

882000 

+0280 

721 

7.60 

728 

10160 

065 

1.75 


071 


227 

Spain 

a ooo 

06AM 

812500 

+0230 

1121 

1120 

1028 

10200 

043 

1.55 


090 


327 

UK G»ta - 

6j000 

06AM 

90-11 

- 

820 

827 

828 

ESL veL tore. Cate 2508 feta 137a. Pmtous day's o ore hL Can ZSiOB Puts J1B1B 


£790 

11AM 

87-17 

-2/32 

823 

829 

£53 









aooo 

10/08 

. 108-08 

-araa 

820 

£65 

£52 








US Treasury* 

72B0 

08AM 

15-18 

+W32 

7.91 

726 

729 








7JS0O 

11«4 

98-24 

+1 1/32 

826 

8.10 

721 








ECU (French Govt) 

1000 

04AM 

832400 

+0270 

£54 

£71 

£43 

Spain 








1 Up to S years (24) 

2 5-75 years <23} 

3 Over 15 years (8) 

4 Irredee ma bles (6) 

5 A t stocks fBI) 


11922 

+005 

11926 

126 

£83 

5 yre 

£54 

£57 

£11 

£60 

£81 

727 

£75 

£77 

7.16 

13010 

+010 

13828 

12* 

11.49 

15 yra 

£51 

£51 

£38 

£63 

£64 

7.19 

827 

£88 

724 

15529 

+005 

15522 

2.44 

1087 

20 yrs 

£47 

£48 

£49 

£83 

824 

729 

£78 

8.79 

7.40 

17525 

+022 

174.94 

042 

1047 

frrectf 

£53 

£57 

7.28 







13821 

+0.08 

13041 

1.74 

1023 

















— 

-UtHonSX- 

— 

— 

— Inflation 10% 

• 



Index-Meed 


Nov ia Nov 9 Yr. bqo 


Nov 10 Nov 9 Yr. ago 


6 Up to 5 years (?) 

7 Over 5 years (11) 
B AS stocks (131 


Debentures and Loans 


165.95 

+003 

165% 

054 

527 

Up to 5 yrs 

4.08 4.09 

229 

2.96 

22S 

1.60 

17382 

+008 

17321 

098 

426 

Over S yre 

327 327 

£19 

3.99 

3.69 

£02 

174 02 

+006 

17322 

0.94 

4.41 



— Syear yield — 



-15 year yWd- 

— . - 

25 year yleM 


9 Debs ft Loans (77) 127.99 +020 127.74 2.43 

Averaga gross redemption yteteta an down dbov*. Coupon Binds: Loan OM-7Y9L 


9.57 9.83 9-66 7.33 9. 50 8.61 

Mafenc 8H-10KM: Wtfr 11* and over. I Ft* ytafct ytd Year to dan. 


8.1 S 955 957 8-29 


T Gross fndudng (tacking «x at 12-5 per 
PWes: U3, UK In 32nas. others io dsefcral 


com psyadie by nonraokfenttt 


US INTEREST RATES 


LmcMnw 


Treasury Bb and Bond Yields 


Dec 

Mar 


Open Sett prim Change 
86.7D 87.01 40.82 

85.89 88-20 40.41 


High 

87.11 

8SaB 


Low 

88.56 

BS-B9 


E3L voL Open W. 
51.896 79,390 

702 1,374 


FT FIXED INTEREST INDICES 

__ Nov 70 Nov 9 Novfl May 7 Nov4 YraflO Ugh* LoW 


GILT EDGED ACTIVITY INDICES 

Nov 9 Nova Nov 7 


Nov 4 


Nov 3 


fetLlmto. 


taUndrarUenenScn.. 




One rewb 

178 

IVnyaar. 

898 

TfawriB. 

at ■asm 

ore yew 

524 

524 

Ml 

Bveyre 

UHMT 

surer 

721 

7JB 

825 


UK 


Govt Secs. (UK) 91.45 91.39 90.89 BUM 91.60 102.62 107.04 89.54 GBt Edged 

Reed Interest 107.94 107.69 10759 108m 107.84 12332 133.87 106.50 5-day average 

• lor IBM. Omtmnwi Socutaas ***\ ana oo ra pOMtai: \2TM tan/M), low 40.18 (VI/73. Ffaad Mow No" 

38 and Rnd tnmi 1838. 8E activity men rabaaed 1874. 


843 80.4 79.6 883 763 

813 82.0 813 81.7 793 

133-87 (h/UM) . low 6083 071/75) . Basis lOOt Gomrvnm Sectaries 197101 


■ NOTIONAL UK GILT FUTURES JUFFEJ* £50300 32nds of 100* 


BOND FUTURES AND OPTIONS 


Deo 


Open Sett pries Change 
101-14 101-16 -OOI 

100-21 100-24 -031 


rtgh 

101-28 

101-00 


Low 

101-10 

100-18 


Esl vot Open bit. 
09886 103368 

585 1106 


FT/1SMA INTERNATIONAL BOND SERVICE 


Franca 

■ NOTIONAL FRENCH BOND FUTURES ftlATTF) 


Listed are Dm Mbs rBana&onai 


■ LONG GS-T FUTURES OPTIONS (UFFQ £50.000 84tto c* 100* 


bonds tor rtecti ties la an adequate secondary motet Latest prices at 730 pm on Ntwambar 10 
tawed ad Oder Chg. VWd baud Bd Oiler Chg. YMd 


leaned Bid Oflar Chg. Yield 



Open 

Settpdoa 

Change 

High 

Low 

Esl voL 

Open ire. 

Strike 

Dee 

11084 

111.14 

+028 

111.18 

11028 

187237 

132215 


Mar 

10928 

11022 

+028 

11028 

10078 

5248 

12.696 

lot 

Jun 

10922 

10048 

+028 

109.44 

10002 

108 

£090 

102 

108 


CALLS 


PUTS 


Dec 

1-04 

0-33 

0-14 


Mar 

1-60 

1-32 

1-07 


Dec 

0- 32 
0-61 

1- 42 


Mar 

2-12 

2- 48 

3- 23 


US. DOLLAR STRAIGHTS 
Abbey Mad Tieauy 8% 03 _ 

Afaoai Rrehee 7% 98 

Austria 8% 00 


Eat voL tout. Cass 4818 Pm 15*8. Previous day's apart It. Cals 79391 Pv* 49734 


■ LONG TERM FRSICH BOND OPTIONS (MATF) 


Bank Ned Gemeamm 7 99 . 

BM o' Tokyo SB 

Bdgum5%03 

BTCE 71*97. 


Strifa ‘ 
Price 

- Dee 

- CALLS — 
Mar 

Jun a 

Nov 

— PUTS — 
Dee 

Mar 

110 

111 

112 

ro 

m . 

124 

028 

024 

008 

023 

126 

126 

090 

020 

027 

- 

021 

024 

1.18 

128 

121 

228 

- 


Ecu 

■ ECU BOND FUTURES (MAT/F) 


8r*t)Gas021. 
Canada 9 99 , 


Charg Kang fin 5% 68 
China & 1 ; 04 


Dec 


Open Sail price Change 
80-70 8098 4026 


HW 

81.08 


Low 

80.60 


Eat vet Open int 
2329 6383 


Card firope 8 96 - 
Credt Fonder 9*2 99 . 
Derma* 5** 98 


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22 




FINANCIAL TIMES FRIDAY NOVEMBER tl J9W 


Attwoods ready to 
put itself up for sale 


COMPANY NEWS: UK — r 

SkyB to Higher than average dividend increase of 16% surpri ses City 

‘Wish Northumbrian Water doubles 


ByPeggyHoflnger 


Attwoods, the UK waste 
services group, is today expec- 
ted to promise shareholders it 
will put itself up for sale if 
investors reject the hostile 
£364m cash bid from Browning- 
Ferris Industries of the US. 

The company is likely to 
present shareholders with a 
series of alternatives to the BFI 
bid, which it believes will give 
investors more value than the 
hostile 109p offer. The options 
are thought to range from 
asset disposals to a promise to 
put Attwoods on the block if 
the bid fads. 

“We have got to put forward 
concrete proposals," said a 
company adviser. “Investors 
have to believe we will deliver 
that value." 

Today is the last day under 
the UK takeover code that 
Attwoods can publish any new 
financ ial information. Yester- 
day, the company geared up 


for its final defence with a 
widely expected document 
showing an improvement in 
the first quarter. 

Operating profits rose by 8 
per cent to $15.4m, on sales 10 
per cent higher at $15L3m for 
the three months to October 
3L In sterling terms, operating 
profits were 2 per cent higher 
at £S£m, on sales 5 per cent 
ahead to £96.7m. “The profit 
estimate supports our recent 
comments on the outlook for 
1995 as a whole." Attwoods 
said. 

Attwoods also published an 
independent valuation of its 
UK property assets, which it 
said “demonstrated the inade- 
quacy of BFI's offer". Char- 
tered surveyors Grimiey JR 
Eve revalued the UK assets 
upwards by £33m to £130.fim. 
“BFI’s bid takes no account of 
the underlying value of the UK 
assets," Attwoods said. On 
both earnings and sales multi- 
ples, BFI’s offer undervalued 


Attwoods, the company said. 

BFI attacked the profits fig- 
ures as “dismal”. “The operat- 
ing profit increase is less than 
we were anticipating," said Mr 
Philip Angell of BFL “We had 
expected something closer to 
double digit growth.” 

Furthermore, operating mar- 
gins had fallen and Attwoods 
had underperformed in the 
first quarter compared with 
other waste companies which 
showed on average 54 per cent 
growth. "Attwoods sharehold- 
ers should not take any com- 
fort from these numbers,” said 
Mr AngeLL 

The bidder said it would 
send shareholders a more 
detailed response following 
Attwoods’ final document 
tomorrow. BFI has until 
November 18 to increase its 
offer. 

Attwoods is being advised by 
Robert Fleming, SG Warburg, 
and Smith Barney. CS First 
Boston are BFTs advisers. 


BSkyB to 
publish 
pathfinder 
on Monday 


By Peggy Holllnger 


By Raymond Snoddy 


ScottishPower signs 
joint National Grid deal 


By Michael Smith 


Scottish Power 


ScottishPower said yesterday 
that together with Scottish 
Hydro-Electric it had signed an 
agreement with the National 
Grid to increase the capacity of 
the England-S Gotland intercon- 
nector by more than a third. 

Mr Ian Preston, chief execu- 
tive, said the interconnector 
increase from 1.600MW to 
&20GMW would mean that the 
company could export "well 
over 30 per cent” of the elec- 
tricity it produced from 1997, 
when the improved facility is 
operating fully. 

The announcement accompa- 
nied a 6 per cent rise in 
interim pre-tax profits to 

tmftn 

The interim dividend is 
raised 10.2 per cent to *L55p. 
payable from earnings per 
share in the six months to Sep- 
tember 30 of ll.Olp, a 2 per 
cent Improvement. 

Raminga were depressed by 
an increase in the tax charge 
from 24 to 27 per cent This 
compares with 26 per cent for 
the whole of last year. Turn- 
over rose 9.6 per cent to £733m. 

Mr Preston said there were 
no plans to implement a share 
buy-back programme. “We are 
not short of good opportunities 
to invest funds and enhance 
shareholder value," he said, 
dting the company's telecom- 
munications, retailing and gas 
interests as examples. 


Share price relative to the 
FT-S&A Electricity Index 
1001 



1993 

Sourtw FT GrapWta 


Asked if the company was 
considering takeovers or merg- 
ers with regional power compa- 
nies in En gland and Wales Mr 
Preston said: “We have ruled 
nothing out". 

A reduction of 300 in core 
staff levels to 5,500 held 
employee costs at £75m (£74m). 

Retailing profits feu from 
£22m to £L8m following the 
acquisition of 50 Clydesdale 
stores which it has been refur- 
bishing. Tbe company said the 
stores were hack in service and 
exceeding expectations. It 
expects to better last year’s 
retail profits of £7.4m. 

Debt amounted to Elfim, with 
gearing of L8 per cent Mr Ian 
Russell, finance director, said 
he expected gearing to be close 
to doable figures by the year- 
end. 


• COMMENT 

ScottishPower's problem is 
that, like Scottish Hydro-Elec- 
tric, it is more tightly regu- 
lated than companies south of 
the border and its ability to 
outshine them in profit or divi- 
dend growth is constrained. It 
is seeking to distinguish itself 
by building shareholder value, 
rather than distributing it 
through share buybacks and 
one-off dividends. Laudable 
though diversification into 
“utility-related” business may 
be, it has yet to prove itself: 
annual retailing profits will be 
closely scrutinised. Scottish- 
Power's advantages include 
the expanded interconnector. 
which could have a significant 
effect on profits, and the fact 
that it has less to fear from a 
Labour government penalising 
over-profitable utilities. The 
shares are trading on a pro- 
spective yield of 4^ per cent, 
assuming a full-year dividend 
of 13.65p, and are fairly 
rated. 


British Sky Broadcasting, the 
satellite television venture is 
pushing ahead with a 
December flotation in London 
and New York, expected to 
value the company at between 
£4bn and £4J5bn. 

Tbe offer of some 20 per cent 
of the enlarged share capital 
will be launched with a 
pathfinder prospectus on 
Monday. 

The value of the offer is in 
the middle of expectations. 
Some estimates put a potential 
valuation of more than £5bn 
on the company, farmed out of 
a merger between Sky 
Television and British 
Satellite Broadcasting. 

The closing of the offer is 
expected in toe week 
beginning December 5. which 
means the float will come 
about a week after shares of 
TeleWest, the UK’s largest 
cable operator, start to trade 
in both London and on the 
Nasdaq market in New York. 

The mam shareholders in 
BSkyB are Mr Rupert 
Murdoch’s News Corporation, 
Pearson, the media group that 
owns toe Financial Times. 
Granada, the television and 
leisure group, and Chargeuxs, 
the French industrial 
company. 

In addition to the 
institutional offer, 12 firms 
were named yesterday as 
providing share shops for the 
retail offer of shares. 

As BSkyB moves towards 
flotation, designed mainly to 
reduce debt, toe satellite 
company is believed to be 
signing up new subscribers 
through both cable networks 
and direct to the home at the 
rate of about 60,000 a month. 

BSkyB is also thought to be 
on toe verge of signing a deal 
with SES of Luxembourg. SES 
operates the Astra satellite 
system for five more 24-hour 
channels, which will be used 
to provide further services. 

One part of the extra capacity 
win enable experimentation 
with pay-per-view services, 
particularly for recent films. 

The London listing is being 
co-sponsored by Goldman 
Sachs and Lazard Brothers. 


Northumbrian Water Group 
yesterday took the lead to the 
industry's dividend bonanza 
with a record 16 per cent 
increase from 8.1p to 9.4p for 
the six months to September 30 
- its first pay-out since the 
price review. 

Northumbrian, smallest of 
tbe privatised water and sewer- 
age companies, also indicated 
that real dividend growth 
would be higher than expected 
over the next five years as it 
sought to wind down excep- 
tionally high dividend cover. 

Tbe announcement follows 
better than expected pay-outs 
from Thames and Anglian, 
which increased dividends by 
11 and 10 per cent. 

Mr David Cranston, chief 
executive, said Northumbrian 
intended to bring its cover 
down from about 4 times to 2.5 
by the end of the decade. This 
would happen within a pricing 
regime which was “tough, but 
achievable", he said. 

He sought to fend off poten- 


tial criticism by saying the 
increase represented on aver- 
age about I5p per customer, or 
£■400,000 in total. This com- 
pared with the Sim which 
Northumbrian expected to con- 
tribute this year to a new 
regional fund it had set up to 
encourage economic regenera- 
tion in the area. 

Analy sts, however, described 
the action as maverick. The 
company had been expected to 
offer a higher than average 
increase, but 16 per cent was 
Tin p rp npffantpri, said one. 

Pre-rax pro fi t s for the first 
half more than doubled from 
f2?,6m to £46-lm on sales 5.4 
per cent ahead at £155.7m 
(£l44.7m). Earnings rose from 

30-3p to 59.1 p. 

The sharp profits increase 
was largely due to tbe absence 
of £8ita in exceptional charges 
for the closure of a pipe main- 
tenance business and a £2 2m 
loss on discontinued 
operations. At the operating 
level profits rose by 43 per cent 
from £4lm to £55.5m, indndmg 
£1 jfrn from acquisitions. 


Northumbrian Water 


Share price retattvw to the 
FT-SE-A Water Index 
HO ■- 



1999 

Source FTfinpHfr'. 


In the regulated water and 
sewerage business, operating 
margins rose from 38 to 47 per 
< ynt- This was largely due to a 
4 per nt reduction in operat- 
ing costa. 

The non-regulated environ- 
mental services business 
increased losses to £1.5m 
(£900,000). However, Northum- 
brian expected the business to 
return to profit in the second 

half. 


• COMMENT 

Labour’s can far-a 
rate for utilities put a dampen -. 
ner on water shares yesterday; 
Yet Northumbrian's bold move 
should reinforce the .visw 
other water companies are 
likely , to rethink dividend 
policies. The most dpejaar p^ 
didates for higher increases^' 
Southern, Severn Trent ted 
Welsh, although none off Iheni 
is likely to come tear 
Northumbrian’s figure; VSjsaa- 
while, the company* 
ate prospects are 
It should beat efficiency tar- 
gets, which have been set by - 
the regulator, and. is aba ~ 
expected to inaease , the, teal 
dividend by 16 per ceat. How- . 
ever, a higher tax chai^e 
might mean a. more modest i : 
increase next year. Forecasts 
are for about £83m firis yem’ -/■ 
before exceptionate. With flie 
shares rising 16p to 
prospective p/e of 6 and te dte 
idend prospects mate North-. ,r 
umbrian stand out. aKumgh * 
the water sector labours under 
substantial political rfsk^ 


Leeds Permanent rises to 


By Alison Smith 


A fall of almost £50m in 
provisions for bad and doubtful 
debts helped Leeds Permanent 
Building Society, the UK’s fifth 
largest, report a 32 per cent 
increase in pre-tax profit for 
the year to the end of Septem- 
ber, taking it from £18&2zn to 

E245-8m. 

The drop in provisions - 
from £131 .lm to £S2.2m - also 
assisted Leeds Permanent's net 
interest income, which rose to 
£456.4m (£425.8m), through a 
reduced charge for irrecover- 
able interest 

Non-interest income was flat 
at £l04.6m (£10L2m), although 


a further £9.lm was set aside 
as statutory reserves for the 
life insurance subsidiary which 
became operational in July. 

Mr Malcolm Bair, chan-rom. 
said the society - white has 
been without a chief exeentive 
for more than 18 months - was 
now closer to making an 
appointment than it bad been 
six months ago, and that a 
statement would be made in “a 
matter of weeks rather than 
months". 

It awns unlikely, however, 
that a new chief executive will 
be appointed before the end of 
the year. 

Mr Roger Boyes, finance 
director, grid that against the 


background of a relatively flat 
mortgage market, he saw pros- 
pects for growth coming from 
non-core areas such as sales of 
fife insurance and milt trusts. 

It would be important, he 
said, both to ensure that the 
organisation's infrastructure 
could defiver service at a low 
cost and to develop new areas 
of business. 

However, toe society had no 
tmmpdiata plana to taka advan- 
tage of the greater powers 
white bad been proposed by 
the government to set up a 
wholly-owned general insur- 
ance business. 

Leeds’ recurring administra- 
tive expenses rose by a little 


less than 4 per cent to £226.im, . 
and costs of a further £SAn 
were incurred in a votanfazy/ 
redundancy programme. Total 
assets rose slightly to £20j6ba 
(El&Sbn). 

Mr Boyes said that Leeds 
Property, the society's estate 
agency, had reported profite d 
£360,000. He admitted that ; 
these were modest and said ' ' 
that over the last few yarn it 
had delivered much Jetentet-- : 
gage business to the society - 
than had been hoped. 

The society was fully cant 
nritted to the estate agency, he 
said, but “all parts of the bust * 
ness are constantly under 
review*. 


Appleby 

Westward 

downturn 


Warner Howard ahead 


Warner Howard, which rents 
and distributes laundry and 
catering equipment, reported a 
11 per cent advance in pre-tax 
profits from £3J22m to £3.46m 
in toe tec months to August 3L 
Although investment in new 
equipment in its markets can- 


ASo( these securities having been sok]. this announcement appears as a matter of moonf only. 


Chemical Works of 

GEDEON RICHTER LTD. 


turned to be slow, the company 
said there had been progress in 
rentals and Its new niche mar- 
kets. 

Mr Ronald Hooker, chair- 
man, said that the continued 
strength of the balance sheet 
enabled Warner to pursue fur- 
ther expansion and several 
possible acquisitions were 
under review. 

Cash flow was positive and 
period-end gearing was mL 

Turnover advanced from 
£10-7ta to £11 .lm, a rise of 4 per 
cent Earnings per share were 
9.76p (9.11p). The interim divi- 
dend is raised to 2^p (2.27p) 
partly to reduce disparity 
between the interim and final 
payments and partly to reflect 
the company's growing cash 
generation and liquidity. 


Pre-tax profits at Appleby 
Westward Group, the grocery 
distributor, dropped from 
£730.000 to £146,000 for the 28 
weeks to September 10. The 
result included £90,000 profit 
on the disposal of the 
USM-quoted company's 
commercial vehicle repair 
business. 

Although turnover improved 
from £38J2m to £45. lm, operat- 
ing profits tumbled from 
£707,000 to £62,000. 

The reduction in profit was 
largely because of a £520,000 
sub-contract commission pay- 
ment, the company said, as 
well as a small decline in 
gross margins in the core food 
distribution business. The 
shopfitting operation incurred 
a small loss. 

Mr Roger Harvey, chairman, 
said Appleby had decided to 
meet competition by increas- 
ing its company-owned and 
operated stores. 

Earnings per share were 
down to l.7p (8J>p). However, 
toe 3.2p interim dividend is 


Ladbroke plans to reduce 
staff in reorganisation 


By Michael Sfcapbifcer, Leisure 
Industries Correspondent 


Ladbroke is to reduce its head 
office and central services staff 
by more than half in a reorgan- 
isation which will be com- 
pleted by the end of tills year. 

The hotels, betting and 
re tailing g r oup said the num- 
ber of head office and central 
administrative staff would be 
cut from 280 to 120. Not all of 
the employees affected would 
be made redundant as some 
will be moved into Ladbrake’s 

div isions . 

Members of the head office 
legal department will be moved 
into the group's individual 
businesses. Posts white will be 


eliminated completely, how- 
ever. include 85 jobs at a group 
distribution depot in Barnsley. 

Ladbroke said profits in the 
three months to the end of Sep- 
tember were ahead of the same 
period last year and recovered 
the first half shortfall - pre-tax 
profits for toe six nvmt-hs to 
June 30 were £57.3m after 
exceptional items, compared 
with £6&5m. 

Hotels in the UK, particu- 
larly in London, showed 
increases in both occupancy 
and room rate. Hotel perfor- 
mance in continental Europe 
and Japan, however, was 
below last year’s level and sig- 
nificant recovery would not be 
apparent until 1995. Hilton's 


performance overall was 
slightly bdow that of the corre- 
sponding period last year, the 
group said. 

Retail betting in the UK was 
hampered by dry summer 
weather and hard ground, but 
had since recovered. Credit 
betting in the third quarter 
was lower than in the second, 
although Ladbroke described 
results as “satisfactory". The 
Vernons pools business per- 
formed wdL 

Sales at Texas Homecare 
were slightly down an a lfioe- 
for-like basis, but margins 
unproved following measures 
taken in the first half. 

The shares rose lp to close at 
154p. 


NEWS DIGEST 


Queens 
Moat 
under fire 


the AGM is perfectly in order 
and it will be held before the 
end of this year.” 


Lofc advances 


International Offering of 4,413,512 registered ordinary shares 
evidenced by a Global Instrument of Certificates 


Sotheby’s back in the 
black after nine months 


By David Blaclanll 


the State Holding Company 
of the Republic of Hungary 


in conjunction with a Capital Increase by 
Chemical Works of Gedeon Richter Ltd. 


The International Offering also comprised 688,125 GIC Shares 
owned by the Hungarian Credit Bank Ltd. 


Offer Price: U.S.$12.30 per GIC Share 


A further 464,500 shares were subsequently offered to investors 
in Hungary at a price of 1,330 Hungarian forints per share 


Global Coordinators 


Sotheby’s Holdings, toe parent 
company of Sotheby's, the New 
York-based auction, finance 
and real estate operation, 
returned to the black at the 
nine-month stage, reflecting a 
broad-based improvement 
across the art market 

For the nine months to the 
end of September, income was 
$L5m (£L52m) against a loss of 
$L3m. Net income per share 
was 4 cents (losses of 2 cents). 

Auction sales grew from 
$719.9m to $797 .2m In the nine 
months, and from $84. 7m to 
$105 ^n in the third quarter, 
traditionally a slow period in 
the art market Tbe improve- 
ment followed the UK Old Mas- 
ter Paintings auction in July 
and several single-owner gales . 


including the country house 
sale of Crassrigg HalL 

The group reduced its third 
quarter loss from $ 12.7m (23 
cents per share) to $lL5m (21 
cents per share). 

Ms Diana Brooks, president 
and chief executive, said com- 
bined sales in all collecting cat- 
egories except Impressionist 
and Modern Art and Jewellery 
were up 22 per cent Sales of 
Impressionist and Modem Art 
and Jewellery were ahead of 
the 1992 low, but still below 
last year's levels. 

“We anticipate, therefore, 
that the decline in the perfor- 


Rebel shareholders in Queens 
Moat Houses yesterday 
accused the heavily indebted 
hotels group of breaching com- 
pany law by not calling an 
annual meeting within the 
required time. 

Mr Dennis Woodhams of the 
QMH Shareholders Action 
Group said failure to call the 
AGM could mean there is at 
least one director “not properly 
a director of the company". 

"All directors have been 
appointed by the board itself 
since the 1992 AGM, white was 
the last one validly to elect or 
re-elect directors," he said. 
“Consequently there is no 
director who has been elected 
by shareholders." 

Queens Moat rejected Mr 
Woodhams* suggestions that it 
had breached company law: 
“We are happy to reassure Mr 


Despite continuing difficult 
trading in tanker markets, 
London & Overseas Freighters 
reported pre-tax profits of 
$3.76m (£2. 29m) for the six 
months to September 30, 
against $1.56m, helped by an 
advance in the second quarter 
from $308,000 to 32.08m. 

Half-year turnover for the 
Bermuda-based but London 
listed shipping company was 
316.4m ($i2_7m) with second 
quarter figures of $8.43m 
($7.46m). Earnings per share 
were 5 cents (6.4 cents) and a 
second interim of 0.25 cents 
makes 0.5 cents to date. 


Mr David Stem, chairman, 
said the present season was 
ahead of budget 
Earnings per share unproved 
to 9.1p (5.8p). A recommended 
final dividend of 2p gives a 
total 3p (125p) for the year. 
The shares finned 6p to 75p. 


mance of these two categories, !. Woodhams that the timing of 
coupled with several strong 


Honeysuckle growth 

Honeysuckle Group, the ladies 
wear designer, lifted full-year 
pre-tax profits 56 per cent to 
£L09m for the year to May 31. 
The rise, from £693.852, was 
struck on turnover 42 per cent 
ahead from £15 5m to £22.4m. 


Drayton English 

Drayton English & Interna- 
tional Trust, white seeks capi- 
tal growth through a world- 
wide portfolio of smaller listed A 
companies, reported a 3 per P 
cent decline in net asset value 
during the six months to Octo- 
ber 5. » 

The figure of 102. 6p per share 
at the period end compared 
with 105.7p at the trust's April 
year end. The figure did, how- 
ever, represent an improve- 
ment against the FT-SE-A All- 
Share Index, which dipped 6J. 
per cent during the same 
period. 

Net revenue was £768,000, 
compared with £825,000 in the 
first half last year. 

Earnings per share fell to 
0.i7p (03p) but the interim div- 
idend is maintained at 0.4p. 






r. * - 

.. 


•" T'.V 

... 

< iw . • 


* "" • 
-i.i . -i> 

-V 




je? "L - 




tan loan 

flank of In 


loyal Iiwir; 

fepite pivni 


lil N 


non-recurring sales held in 
1993, will result in lower fourth 
quarter auction sales," she 
said. 


©BCreditanstalt Securities Ltd. 


Schraders 


DIVIDENDS ANNOUNCED 


Standard & Chartered 


ff-SE i . 

Pi Ar 


:c Wff c,u 


Ml Schraders 


Joint Lead Managers 

@ Creditanstalt-Bankverein 


CS First Boston 


Dresdner Bank 


Indosuez Capital 


Appleby Westward _int 

Bank of Ireland mi 

BT — -Jrrt 

Burton fin 

Cranawicfc mt 

Drayton En^teh Jnt 

Honeysuckle 

JF Sec Utffitk* mt 

UMIT mt 

Lo*» Jnt 

H’tanbrian Water _Jnt 

Oxford Instrum - in * 

PwMand fnt 


Klein wort Benson Securities - Merrill Lynch International Limited Nomura International 


Daewoo Securities (Europe) Ud- 


ScottJati Power bit 

Soraks int 

Staretay bids irA 

toueco Jnt 

Warner Howard — i n* 




Comes - 

Total 

Total 

Current 

Data of 

ponding 

for 

last 

payment 

payment 

efiridend 

year 

year 

&2 

Jan 3 

31 


9 

-L25* 

Jan 10 

3.75 

_ 

10-5 

7.05 

Feb 13 

6.65 

_ 

1&7 

1 

Feb 24 

1 

2 

2 

2-45 

Feb 3 

2A 


8.25 

0.4 

Dec 30 

0.4 

. 

0.8 

2 

Jen 5 

1-5 

3 

2.25 

1-5* 

Jan 13 

- 



1 

Jan 27 

_ 

_ 

1 

0259* 

Jan 12 

- 

_ 

2 

8.4 

Mar 1 

8.1 

_ 

24.3 

1.7 

Mar 23 

1.5 

. 

4.9 

2 

Jan 9 

2 

. 

5 

1 

Jan 12 

1 

_ 

4 

4.55 

Mar 10 

4.13 

_ 

12.4 

1-25 

Feb 8 

1 

. 

2.5 

2.3 

- 

2.3 

_ 

8.5 

It 

Feb 14 

0.75 

_ 

2 

2L8 

'Jan 9 

2-27 

- 

7.31 


Standard Chartered PLC 


September, WS4 


P^f** 1 *^ sho *'" 1 S?™* P® 1 " share net except where otherwise stated. tOn 

dSft^hja^S! * w, h A™** Interim; tnakaa 4ipto 

twee. TUS cants. * Second interim; makes 0.5 cents to data 


US$300,000,000 Undated Primary Capital 
Floating Rate Notes {Series 2) 

In accordance with the provisions of the Notes, 
notice is hereby given that for the six months 
period (182 days) from 14th November 1994 to 
15th May 1995 the Notes will cany interest at 
the rate of 6.375 per cent per annum. 

The interest payment date will be 15th May 
1995 Payment, which will amount to 
US$322.29 per US$10,000 Note and US$ 
1,611.46 per US$50,000 Note, will be made 
against surrender of Coupon No. 19. 

West Merchant Bank Limited 
Agent Bank 


AB Svenak £ T |mrtl nw)^ 
( SikAJi Eifun CmptnanO 

< lxt«tuuiai m TJif of 

Swfxfcn mh fcoHaf bMhy) 

HK$ 3 00,000,000 
Reverse Floating Rate 
Notes due 1998 
Fur the Inremt Period 7rfa 
November, 1994 ro6di Feb- 
ruary. 1995, die Nora will 
carry an Interest Rate of 
21 4688% per annum with 
Coupon Amounts of HK 
$535.25 and HKS5J52.50 
per HK$ 1 00.000 and HK 
$1,000,000 Notes respect- 
hiely The relevanr Interest 
Payment Dhte will be 6th 
February. 1995- 







23 





FINANCIAL TIMES FRIDAY NOVEMBER II 1994 


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COMPANY NEWS: UK AND IRELAND 


Debenhams rises but losses at Principles, Top Shops and men’s wear 

Recovery helps Burton to £41m 


By David Btackwefl 

Barton, the clothing retail 
group including Debenhams. 
Burtons and Dorothy Perkins! 
more than doubled profits last 
year despite falling into the red 
in its multiples division. 

Pre-tax profits were fiil.im 
in the 53 weeks to September 3. 
up from £ik3m in 1392-98 when 
there was an exceptional loss 
of £19. 6m. Total sales edged 
ahead from £L89bu to £l-91bn. 

Mr J(4n Hoeraer, pWrf exec- 
utive, said the group’s plans 
for recovery were moving 
along the right track, althou gh 
all was not behaving exactly as 
he would have liked. 

The strategy of rebuilding 
tile brands had led to better 
sales and margins throughout 
the group in the second half. 
with the exception of Burtons. 

.Otomp • 


*Zli/“** . J:-. 


,*?\y \i,V7rT' ,<■'• 

, "T". * * * ’•» 


The men’s wear chain 
reported an operating loss of 
£l2.4m (£&4m profit) on sales 
down 5.5 per cent to £2SSm 
(£27&3m). Sales tell 19 per cent, 
although 7 percentage points of 
the decline were accounted for 
by the decision earlier this 
year to contract out its busi- 
ness in mein’s suits. 

Mr Hoerner. said the group 
had reduced the amount of 
sales promotions at Burtons 
and had cat stocks, bat be was 
“ not expecting any great 
thtng a thin season". 

Losses at Principles rose 
from £11 .5m to £19-4m on lower 
sales of £106.3m (£12Q.4m), 
although the figures reflect a 
fell in the number of outlets. 
While losses at Top Shop/Top 
Man increased to £7.2m 
(£5-lm), sales edged ahead to 
£216.9m (£2LL9m), and the sec- 
ond half was just in the black. 

Dorothy Pe rkins and Evans 
both increased operating prof- 
its, to £11.4m (210m) and 
£12L5m (£10 .9m) respectively. 

In the first nine weeks of the 
current year the multiples had 
operated without staging sales 
for 90 per cent of the time, 
compared with only 30 per cent 
last year. 

This had resulted in an 
improvement of 5 percentage 
points in the gross margin, 
although the group stressed 
that this was not sus tainab le 
throughout the first half. 

Operating profits at Deben- 
hams rose from £57.7m to 




A€lm 

W Ssif? 



LydkvandarMaar 

Andrew Hagginson, finance director, left and John Hoerner 


£71. 5m on sales ahead from 
£8544m to £910.4m. 

Net interest payable fell from 
£31.4m to £17.7tn, and net debt 
at the end of the year was 
£77m, down from £212m. This 
was mainly as a result of the 
sale in May of four shopping 
centres for £l53m, a deal that 
ended the group’s foray into 
the property business. 

Earnings per share were kip 
(0.9p). A final dividend of lp Is 
proposed, giving an unchanged 
2p for the year. 

• COMMENT 

The name of the game is to get 
the multiples back in profit, 
particularly Burtons and Prin- 
ciples which between them lost 
£32m - a sum not ter short of 


I£7m loan recovery helps 
Bank of Ireland rise 28% 


By John Capper, 

Banking Ecfftor ' 

An unexpected , recovery of a 
l£7m individual loan that had 
been written off helped pre-tax 
profits at Bank of Ireland rise 
by 28 per cent from l£L309m to 
l£167^m (£16A3m) in the six 
months to September 30. 

The hank disclosed that com- 
petition for deposits m Ir eland 
had narrowed its net interest 
margin from 4.S per cent to 4.1 
p er cent, althoug h the effect on 
income was offset by loan 
growth, including a strong rise 
Itt mnrtgagBS. 

It raised its interim dividend 
by 13 per cent to A25p (3.75p), 
empha&ising tjiat this was “to 
order to achieve a better bat. 
ence” with the final Earnings 
per share ' rose from 15-2p to 
22p, and.net asset value per 


share grew from 144p to 174p. 

Mr Maurice Keane, deputy 
chief executive, said it might 
repay some subordinated loan 
capital from next year onwards 
as retained earnings strength- 
ened capital, but had no plans 
. to distribute cash to sharfthnld - 
ers in a share buy-back. 

Mr Keane said the hank was 
more likely to use the cash for 
acquisitions. He said this could 
include the purchase of a mort- 
gage portfolio in the UK, or an 
expansion of life insurance or 
pensions in Ireland. 

He expected margin pres- 
sures to continue, and said 
4hat they' could extend from 
deposits to lending if National 
Australia Bank dr National 
Westminster Bank succeeded 
in buying TSB Bank, creating 
a larger competitor. 

The First New Hampshire 


group, its US retail arm, 
returned a I£l3.9m profit 
(I£3.Sm loss). Mr Keane said 
the subsidiary would be 
retained for at least two years 
in order to gain the tax benefit 
of arraimnlatari losses. 

Loan loss provisions as a per- 
centage of loans fell to what 
Mr Keane said was an “unsus- 
tainably low" level of 02 per 
cent as a result of loan recov- 
eries of I£10.Gm, including the 
unidentified individual recov- 
ery of about l£7m. 

Net interest income fell 
slightly to I£30A9m (I£3LL2m) 
as a result of narrowing mar- . 
gins, but loan loss provisions 
fell to I£U.4m (I£47.5m). Oper- I 
ating expenses slipped by 1 per 
emit from i£288.7m to 11385.2m 
as staff costs fefi. 

The shares closed unchanged 
at 28®. 


Royal Insurance at £31 lm 
despite premium income drop 


Total premium income at 
Royal Insurance fell to £&56bn 
■ in the first nine months of this 
year, compared with £S.76bn. 
Royal said, however, that the 
drop largely' reflected a 
planned reduction in its rein- 
surance operation,, writes 
Ralph Atkins. 

- -The amount of personal 
motor premiums written fell 
tiy 5 per cent in the nine 
m onths to £239m. Within that 
total. Royal said The Insurance 
Service, ite direriieefiing opera- 
tion, was talcing an increasing 
diaw * of business. 

The group's pre-tax profits 
jamped from £USm to £3Um. 

The UK-based life operation 


achieved a 5 per cent increase 
in operating profits to £38m , 
but the overseas life operations 
dropped by £2m. Overall UK 
operating profits jumped to 
£27&n against £79m, helped by 
good weather conditions and 
fewer claims. 

Royal’s chain of 481 estate 
agents made an increased loss 
of £lim against £7m, partly 
from refurbishment costs. 

US operations also lost 
money, not helped by a high 
level of weather and catastro- 
phe-related claims. But Royal 
expressed confidence in a 
recovery ahead, noting that the 

second and third quarters had 
seen some improvement in 


underwriting results compared 
with a year earlier. 

Adding to the spread of its 
business. Royal said it had 
struck commercial agreements 
with German and Scandina- 
vian insurance companies 
which had increased its access 
to markets in those countries. 

The group's capital and 
reserves decreased to £L94bn 
at September 30, compared 
with £2L2bn at the end of 1993 
as a result of tells in world 
equity and bond markets. Total 
investment income fell to 
£359m from £38Qm owing to the 
effect of lower interest rates 
and the move in asset alloca- 
tion towards equities. 


Exceptionals help Orb to £13.8m 


Orb Estates, the commercial 
property developer, reported 
' pretax profits of £13£m for the 
year to June 30, compared with- 
a restated loss last time of 
£383m. 

'The company had returned 
to the black at the interim 
stage, with a profit before tax 
of £833m. 


The full-year result came cm 
the back af 'tumover down 14 
per cent at £11 .3m (£i3.Im). 
The board said profits were 
almost entirely made up of 
exceptional items, including 
£145m credited in respect of 
the company's capital recon- 
struction, as well as a £826,000 
profit on the sale of investment 


properties. Last year’s figure 
included a £20 2m writeoff 
Operating profits were 
fiL92m, against losses of £3.6m 
after losses at discontinued 
operations of £4.05m. Earnings 
per share were 1.98p (41.8p 
losses), taking into account the 
reconstruction and the share 
igs ifl ft hi January. 


FT-SE Actuaries Industry 
Classification System 


Following a partial review of 
the Financials Economic 
QnmpLOf tlte Industry Classifl- 

cation System, the FT-SE Actur 
aries Industry Classification 

Committee has agretri to refine 

and update the current system 
to reflect the changi ng natu re 
' irf many 'companies currentiy 
classified in these sectors. The 
following improvements vwul 
be inqilanented-pn December 
31 1994: 

- • Bamking Sectors The two 
cmrent^ banSir® sectors are to 
' be Emsmed Banks, Retail and 
Banks, Merchant and rede- 
fined. This .will provide a 
clearer distinction, between 


• Fnnd Managers & Stockbro- 
kers- A iwwsub-secfea* wfihin 
the Other Financial industry, 
sector wffl be introduced, 
^owtnp- aU fund man- 


agers and stockbrokers into 
one distort suheector. 
.•Discount houses -'Ihissub- 
seetbr wiQ be discontinued and 
the companies previously clas- 
sified as discount houses clas- 
sified elsewhere. . 

• Investment Trusts - The 
Investment Trusts sector had 
. grown very large and included 
a variety of different trusts. 
Consequently, the Classifica- 
tion Committee, working in 
conjunction with the Assoda- 
tiim of Investment Trust Com- 
panies, have divided the old 
Investment Truste sector into 
six new sub-sectors: UK Gen- 
eral, European, International, 
Geographic Specialists, Ven- 
ture . & Development Capital, 
ami $dit Capital Funds. 

.“The business world is con- 
stantiy changing and these on- 
going improvements to the 


Industry Classification System 
help to ensure that it is always 
up-to-date and relevant”, com- 
mented Mr Nick Fitzpatrick, 
fhairawro of the FT-SE Actu- 
aries Industry Classification 
Committee. 

“The Investment Trust sec- 
tor had grown as new trusts 
were launched and dividing it 
into six new sub-sectors win 
result in more homogenous 
groupings. Pm sure that this 
and our improvements to the 
definition and segmentation of 
the bank and financial sectors 
will be welcomed by inves- 
tors". 

Details of the changes to 
Individual stocks will be 
published after the next 
meeting of the FT-SE Actuaries 
Industry Classification 
Committee on December 5 
1991 


the group’s total profit Stabi- 
lising margins an d reestablish- 
ing price Integrity without los- 
ing sales is not* easy, but early 
indications for the current year 
suggest the group has taken 
the right approach. At Princi- 
ples, sales in the early weeks 
are nearly 7 per cent higher 
and 59 of the badly performing 
stores have been taken out of 
the division. A quick turn- 
round will follow if the strat- 
egy is successfuL This is 
reflected in the share price, 
which rose 7Vip to 71p yester- 
day. Forecast profits this year 
of £65m put the group on a 
prospective multiple of more 
than 20, a premium to the sec- 
tor - but perhaps still attrac- 
tive to the optimists. 

Approach to Walker 
shareholders 

Principal shareholders of JO 
Walker, the listed timber 
company, have been 
approached by a third party 
with a view to acquiring a 
“substantial stake" in the 
group. 

The largest individual share- 
holder is Mr David Walker, the 
chairman, who owns 25 per 
cent 


Fears of 
potential 
Campari bid 
allayed 

By Peter John 

Fean that a potential Udder 
might be moving in on Cam- 
part International, the com- 
pany which designs and mar- 
kets leisurewear and 
sportswear, were allayed yes- 
terday. The buyer of an 11 per 
cent stake was revealed as a 
private investor. 

It was announced on 
Wednesday that a company 
called Biueridge had acquired 
1.12m shares, representing 
10.73 per cent of Campari. 

Campari was unaware of 
; what Biueridge was and what 
I Its Intention might be. The 
textiles group appeared vul- 
nerable because its share price 
had fallen by a third to 24p at 
the end of October following 
the announcement of £3.7m 
rationalisation costs to combat 
difficult trading conditions. 

It transpires that Biueridge 
is the private investment 
vehicle of Hr Paul Thompson, 
the chairman of Sanderson 
Electronics, a Sheffield-based 
computer support company. In 
October, Sanderson was on the 
acquisition trail, taking a con- 
trolling interest in SGA Pac- 
ific from General Automation. 

However, Mr Thompson said 
yesterday that Biueridge was 
his personal investment 
vehicle, there was no synergy 
between his company and 
Campari and he had no preda- 
tory intentions. “I just 
thought the shares were cheap 
despite the fact that the com- 
pany is not enjoying the best 
of times at the moment” 

Mr Bob WiRdnson, Campar- 
i’s company secretary, said: 
“Obviously we were keen to 
find oat what Mr Thompson’s 
intentions were. We have spo- 
ken to Him and he has indi- 
cated that the stake fs purely 
for inv e stmen t purposes.” 

The shares gained 2p to 
dose at 27p yesterday. 


VSEL chairman urges 
quick OFT bid decision 


By Bernard Gray, 

Defence Cfoireepondent 

Lord Chalfont, chairman of 
VSEL, the submarine maker 
coveted by BAe and GEC, yes- 
terday uxged the government 
to make a quick derision an 
whether to allow the takeovers 
to proceed. 

Bids from both companies 
are currently being examined 
by the Office of Fair Trading to 
determine whether they raise 
competition worries. 

Lord Chalfont has written to 
Mr Michael Heseltine. trade 
a nd industry secretary, p™* Mr 
Malcolm Rifirind, defence sec- 
retary, asking Ihem to main* 
their racommeodations to th e 
OFT quickly so that sharehold- 
ers and employees can be dear 
where they stand. The govern- 
ment said a decision would 


be reached as soon as possible. 

The impatience at VSEL 
came as the OFT Indicated that 
it would not now rule on BAe’s 
bid by November 16, but had 
extended the deadline to 
December 7. A decision on 
whether or not to refer either 
bid to the Monopolies and 
Mergers Commission is now 
expected in the first week of 
December. 

About ISO shareholders 
attended an extraordinary 
meeting at 7pm on Wednesday 
evening at the Vickers sports 
and social club in Barrow. The 
meeting voted to amend 
VSEL's articles to allow BAe to 
buy more than 15 per cent of 
the shares. An EGM to approve 
a similar waiver for GEC is to 
be held on November 24. 

VSEL workers are concerned 
about the prospect of being 


takan over by either company. 
The few worker-shareholders 
who remain, however, are keen 
to see the takeover race pro- 
ceed rapidly to secure the high- 
est price possible for their 


While the amendment to the 
articles will allow either com- 
pany to take over VSEL, nei- 
ther BAe nor GEC can buy 
more than 16 per emit of Its 
shares in the market »ntfl they 
have an acceptance of their bid 
by a majority of shareholders. 

GEC already owns 15 per 
cent and therefore cannot 
increase its stake until it has 
acceptances from another 35 
per cent of VSEL's sharehold- 
ers. BAe has no VSEL shares 
and cannot currently buy in 
the market as VSEL's shares 
are well above the cash alter- 
native to Us all-share offer. 


Cookson makes £10m Wellington 

launch 

German acquisition postponed 


By Richard Wotffe 

Cookson, the specialist 
industrial materials group, yes- 
terday aimed to strengthen 
electronics operations in conti- 
nental Europe by taVfag full 
control of Alpha Chillo, its Ger- 
man joint venture. 

Cookson paid £10.4m to buy 
the remaining 50 per cent of 
Alpha GriDo, which Is the lead- 
ing German producer of sol- 
ders and fluxes, from the 
Metallgesellschaft subsidiary 
Grille Werke. 

Mr Richard Oster, chief exec- 
utive, said: “By gaining full 
operational control of Alpha 
GriSo, we are ahle to capitalise 
more effectively on the poten- 
tial that exists within the Ger- 
man and eastern European 
markets." 

Alpha (Milo would provide 
Alpha Fry with an important 


springboard for expansion into 
developing markets such as 
Poland, the Czech Republic 
and Russia, he added. 

Alpha Fry forms part of the 
group's electronics materials 
side, which contributed 33 per 
cent of Cookson’ 3 £inm oper- 
ating profit last year. It is now 
expected to help improve prod- 
uct development and distribu- 
tion at the German company. 

The acquisition, which Is to 
be fimded from existing facili- 
ties, follows a joint venture 
with Thyssen of Germany to 
manufacture and supply cen- 
tral and eastern Europe with 
special refractories and 
systems used in the steel con- 
tinuous casting process. 

It also forms part of a strat- 
egy of withdrawing from non- 
core businesses, which led to 
the disposal of 25 engineering 
subsidiaries in March. 


The planned launch of 
Wellington Underwriting as a 
listed company investing in 
Lloyd’s of London has been 
postponed following the insur- 
ance market’s failure to agree 
new rules on corporate capital, 
writes Ralph Atkins. 

The company said It was 
now proposing an impact day 
in the middle of next week 
Instead of today. 

Wellington had intended to 
place 30m shares at 100p and 
use the capital to invest in 
seven Lloyd’s syndicates nm 
by the Wellington managing 
agency. It hoped to attract 
money from existing corporate 
investors at Lloyd’s, but this 
depended on Lloyd's a p pr o ving 
new rales on corporate 
vehicles investing In each 
other. 

Wellington has decided to go 
ahead without the new rales. 


We have continued to increase profitability by 
growing sales and controlling costs, while 
improving service to our customers. We have been 
making significant capital investments to anticipate 
the long term needs of the business.” 

MURRAY STUART 

CHAPMAN 


Expanding horizons 

Interim Results for Six Months to 30 September 1994 


4.13p 


3.72p 


4.55p 


T. ■ 


Dividend increase 




Profit before tax has grown by 6.2% to £123 million reflecting increased sales and our 
continuing success in reducing costs through benchmarking programmes. 

> Earnings per share are up 2.1% to U.Olp per share and the interim dividend is up 10.2% to 
4.55p per share. 

^ Our sales outside Scotland are growing and our investments will mean that these will 
continue to increase progressively. 

#* The principal regulatory controls for our business are now known for the next three years 
and we are confident that we can achieve further cost reductions and grow profit margins. 


ScottishPower 


A copy of the Scofo&hPower inter mi Report, containing hiD information on the company’s results for the si* months to 30 September 1 994 can be obtained from 
Mr Andrew MrtcheU, Company Secretary. Scottish Power pic. I Atlantic Quay, Glasgow G2 BSP. Telephone 041 248 8200. Fax 041 636 4582. 


i 





overseas 


Yams, fabrics and carpets attract interest at home and 

Coats Viyella lines up buyers 


By Simon Davies 


Coats Viyella, the UK’s largest 
textiles company, has lined up 
several buyers for its yarns, 
fabrics and carpet divisions, in 
a move expected to raise more 
than £KXta for the group. 

The shares rose 8 l Ap to 
202%p on the news, reflecting 
investors' surprise that the 
company had been able to find 
a single buyer for what 
amounts to a mixed bag of rel- 
atively unprofitable busi- 
nesses. 

The divisions have net oper- 
ating assets of £120ra, and 
employ 5,400 people. However, 
a number of the businesses are 
scarcely profitable, and despite 
a recently improved perfor- 
mance they achieved operating 
profits of Just £6m last year on 
revenues of £380m. 

The group has had offers for 
some of the businesses in the 
past, but it is understood that 
these have been at far lower 



Tony Andrew, 

Neville Bain: hopes to sell businesses at close to net asset value 


prices. Mr Neville Bain, chief 
executive, said: “We would 
hope to sell the businesses at 
close to net asset value.” 

The group was approached 
by a number of interested par- 
ties from both the UK and 
overseas. It has narrowed the 


selection down and is confident 
that a deal can be completed 
during the first quarter of 1995. 

Mr Bain was adamant that 
employment rights of the staff 
would be “fully safeguarded”. 

Coats has radically reduced 
its debt over the past two 


years. It is expected to report 
gearing of about 25 per cent at 
the end of 1994. compared with 
65 per cent in 1992. The dis- 
posal would bring the figure 
below 20 per cent. 

Mr Bain said the funds 
raised from the disposal would 
leave Coats in a strong posi- 
tion to expand its core busi- 
nesses, particularly clothing, 
precision engineering and 
homeware. However, no acqui- 
sitions were imminent, he 
added. 

The disposal is likely to have 
a neutral impact on the compa- 
ny’s profits but analysts were 
optimistic that the cash could 
be channeled into core busi- 
nesses that could achieve a far 
higher return on capital 

Coats' Indian fabrics busi- 
nesses, which are held by a 51 
per cent-owned subsidiary, are 
to be retained by the group. 

Baring Brothers have been 
appointed to advise on the dis- 
posals. 


Enlarged 
Sunleigh 
warns on 
profits 


NEWS DIGEST 


Cranswick Penna recovers 


surges 
to £1.31m 


A more stable trading 
environment helped Cran- 
swick, the supplier of grain, 
feed, livestock and meat prod- 
nets, hoist pre-tax profits by 7a 
per cent from £745,000 to 
£L31m in the six months to 
September 24. Mr Jim Bloom, 
flhairman , said tha t despite low 
pig prices, there had not been 
the same degree of volatility as 
last year. 

Turnover grew by £2m to 
£56 -2m. Earnings per share 
climbed from 4p to 6.lp and the 
interim dividend is stepped up 
to 2.45p (2.4p). 


Penna, the USM-quoted out- 
placement consultants, swung 
back into the black at the 
interim stage as it gained mar- 
ket share in "continuing 
highly competitive” conditions. 

Pre-tax profits for the six 
months to September 30 
amounted to £139,000, against 
lasses of £118,000 last time and 
£309,000 for the previous full 
year. Turnover expanded by 26 
per cent, to £4Alm; fee income 
at Sanders & Sydney improved 
from £3-89m to £4.67m. 

"This Increase has been 
achieved in a marketplace in 
which major competitors have 
reported a decline in sales of 
about 25 per cent,” said Mr 
John Beard, chief executive. 
Marketing initiatives had 
resulted in a number of new 


clients across industry sectors, 
he added. 

Earnings per share emerged 
at UJp (losses of 2p) and the 
interim dividend is again lp. 


past second half profits had 
been substantially higher than 
the first However this year's 
changed workload would mean 
a more even split 


Umeco advances 

Umeco, the aircraft refueller 
manufa cturer, reported interim 
pre-tax profits more than dou- 
bled at £385,000, against 
£154,000. 

The company said all compa- 
nies had performed well in the 
half year to the end of Septem- 
ber with outstanding results 
from the distribution and air- 
craft refuelling divisions. 

Turnover was £9. 15m 
(£6.01m). Earnings per share 
came out at 2.39p (Lip) and the 
interim dividend is raised to lp 
(0.75p). 

The company said that in the 


Crest Nicholson 


Crest Nicholson, the builder 
and property developer, is pay- 
ing £3m cash for CE Cowen 
(Builders), a family owned 
housebuilder based in Harro- 
gate. Crest will also take on 
bank borrowings of about 
£2. 9m. 

The purchase price is similar 
to Coweii's net tangible assets 
at March 31. 

The purchase is part of 
Crest's plans to expand geo- 
graphical coverage. Cowen's 
Harrogate office will become 
the base for the new northern 
region. 


Sunleigh, the leisure products 
group which made a £19-2m 
diversification into prams last 
June, yesterday issued a trad- 
ing statement suggesting that 
profits for the second half of 
1994 would be ‘'small”, writes 
Simon Davies. 

The shares fell l%p to 4%p 
on the announcement Chat the 
group had suffered "a difficult 
third quarter”, due to a down- 
turn in sales in continental 
Europe, particularly for its 
Laser dinghies and Dart 
catamarans. 

The group also makes 
Powakaddy motorised golf 
trolleys, and the purchase of 
Maclaren moved it into a third 
consumer durables sector. 

The acquisition was funded 
by a placing of 320m shares at 
6p, resulting iu a fourfold 
increase in share capital. 

Mr Alan Hancock, chief 
executive, said Maclaren’s 
profits for the third quarter 
had exceeded 1993, but that it 
had a strong seasonal bias 
towards the first half. 
Maclaren has introduced new 
product lines and substan- 
tially reduced its cost base. 

Sunleigh retains a cash sur- 
plus of £650,000. and wifi pay 
a no minal dividend for the sec- 
ond half of the year, its first 
distribution since 1989. 


Somic advances 


Cost controls enabled Somic, 
the maker of yarns and woven 
fabrics, to raise pretax profits 
from £133.453 to £155,788 in 
the half year to September 30, 
on turnover of £2J!8m, against 
£2. 24m. 

Earnings per share were 
5.22p (4-47p) and the interim 
dividend is 1.25p (lp). 



HalfYear 

Results 


Chairman’s statement 

The results for the half year are sound. 

Demand for our products and services 
remains buoyant. Inland call volume grew by 
over 7 per cent in the half year; stimulated by 
our marketing initiatives, including signifi- 
cant price reductions, and by growth in the 
UK economy. 

However; recent and forthcoming price cuts 
will increase the pressure on profitability in 
the second half of the year; as will the impact 
of further redundancy costs. 

I am delighted to report that a key element 
of our global strategy is now fully in place, with 
the completion of our purchase of a 20 per cent 
stake in MCI at the end of September: 

The interim dividend of 7.05 pence per 
share represents an increase of 6.0 per cent 
The Board believes that this provides a fair 
return to shareholders." 


Group profit and loss account 

(unaudited) 



3 Tnnnrhs ended 
30 September 
1994 1993 

£m £m 

6 months ended 
30 September 
1994 1993 

£m £tn 

Turnover 

3,469 

3,426 

6,851 

6,761 

Redundancy charges 

97 

97 

151 

150 

Premium on repurchase 
of bonds 

75 


75 

«. 

Profit before taxation 

712 

743 

1,493 

1.500 

Taxation 

271 

257 

541 

518 

Profit after taxation 

441 

486 

952 

982 

Minority interests 

9 

9 

16 

17 

Profit attributable to 
shareholders 

432 

477 

936 

965 

Interim dividend 



439 

413 

Earnings per share 

6£p 

7.7 p 

15.0p 

15.6p 

Interim dividend per share 


7.05p 

6.65p 


Group cash flow statement 

(unaudited) 


£m 


£m 


£m 


£m 


Sir Iain Mance 

Chairman 

10 November 1994 


Inflow from operating 
activities 


Outflow from returns 
on investments and 
servicing of finance 


Highlights excluding the impact of redundancy 
charges and non-recurring factors: 


Taxation paid 


Outflow from in; 
activities 


■ Turnover was by 2.4% in both the second 
quarter and the half year 


■ Pfe-tax profit was up by 5.2% in the second 
quarter and up by 3.7% for the half year 

■ Earnings per share were up by 5.0% 

1 and up by 3.4% for 

per share by 6.0% 



2.287 


(667) 

(149) 


(338) (3,702) (1,588) 
98 (2,466) (117) 



30 September 
1994 1993 

(unaudited) 
Sen £m 


31 March 
1994 


16,840 16,932 


2m 

16,896 


on its 
in August 
borrowing. 

1,256 million is £270 
first half of 1993/94. This 
Ton Cellnefs new digital network 
Sf advanced network services, 
its purchase of a 20% stake in MCI 
September far a total cost of £2,860 
3 will of £1,937 million has been written 


: amounts 
due after one year 

isions for liabilities 
and charges 

Minority interests 

Capital and reserves 


5,733 

6^21 

5,302 

4,539 

5,669 

5,544 

(588) 

763 

125 

16,252 

17,695 

17,021 

3,514 

3,670 

3,199 

QAC 

WO 

1,114' 

701 

161 

89 

95 

11,582 

12322 

13,026 

16,252 

17,695 

17,021 


increased to 29% at 30 September; 1994. 


L Thfe statement bag been prepared in acaxdmoe with the an mi t n t ii ^ g 
used in the statutory accounts far the year ended 31 March, 1994. 

2. The figures far the year ended 31 March. 1994 are extracts firam there 
account*. A copy the feifl aaxwnta fcsr that yea, an which the auefitors hare 
iwaedan n nqn aSfi ed report, has been delivered to the Registrar of Companieg. 

3. The interim dnidend will be paid on 13 Kbnnrg 1995 to shareboldera on 
the BT register on II January 1995. 


S any Queries aa a shareholder please call 0345 010505. For difly recanted information on the BT share price and matters of mmnst tn nhm, 
i generally; pieree caD 0345 010707. Vw may telephone there number* from anywhere in the UK far the priceof a local calL to share- 

British TelecnamuaiicatiaDS pk^ 81 New^e Street. Loodan EC1A 7AI- 


Old City ties fray as 
new advisers muscle 

Nicholas Denton examines a changing relationship 


4 


A listing in the Craw- 
ford's directory of City 
connections is not 
what it used to be. SG Warburg 
and Baring Brothers are 
recorded therein as wnanrfai 
advisers to drinks company 
Allied Domecq. But It was 
Goldman Sachs, the US corpo- 
rate adviser, that planned 
Allied’s £265m sale of its food 
ingredient business annntTnrpd 
this weds. 

The TTBrtan r-p jg jjq hwlatpri 
one. Goldman g ncroarhEd 
on another traditional War- 
burg client by advising Redritt 
& Column on the disposal of 
the Holman mustard foy 
The coincidence of the two 
cases, aside from reflecting 
well on Goldman Sachs, illus- 
trates a broader point ancient 
ties between company and 
merchant hank m the UK are 
fraying. One UK corporate 
financier says: "I don’t really 
care what goes on in Craw- 
ford’s. It's rather archaic." 

Investment hanking does, as 
its practitioners are fond of 
saying, remain a "relationship 
business” and old ties count 
Redott used Warburg for its 
recent acquisition in the US. 
The UK faVlse is at^n handling 
the disposal of Allied’s bever- 
age and bakery businesses. 

A long-standing re lationship 
remains particularly relevant 
when a company mandates an 
adviser to conduct a rights 
issue or some other core trans- 
action. “A Crawford’s relation- 
ship means a lot," says Mr 
Mark Kicbolls, joint head of 
corporate finance at Warburg. 

But even Warburg, bank of 
record -to more UK-quoted com- 
panies than any other adviser, 
knows the irmiWinns of tradi- 
tion. "Crawford’s does not 
mean that yuu win every bit of 
business from that client,” 
says Mr Nicholls. “All it means 
is that you have an open door." 

Clients are spreading their 
business around more promis- 
cuously than they used to. 
“The big international compa- 
nies like to have two or three 
strings to their bow,” says a 


UK M&A specialist 
financial advisers are adapt- 
ing to tiie wishes of thei r cus- 
tomers. Some, such as Morgan 
Stanley, even make a virtue of 
Hirer willingness to act as joint 
adviser. UK franks have mel- 
lowed enormously since the 
1980s. when so me would 
fHrtwtun to resign rather than 
accept an interloper as joint 
adviser on a transaction. 


relationship wlth a tfiS invest- 
ment hanfe: . u - i 


Clients are 
spreading 
their business 
around 
more 

promiscuously 
than they 
nsed to 


Sharing out favours can be a 
way to smooth the transition 
from one adviser to another. 
“A merchant hawk is like wall- 
paper,” says a US M&A special- 
ist. “You are not going to 
redecorate the room in one 
transaction.” 

Another US investment 
banker says that a UK client 
will save face for its tra d i t i o nal 
marehant bank by giving It a 
token role. “There are times 
when the co-adviser is there 
for relationship purposes. We 
say that as long as they stay 
out of our way everything will 
be fine." 

However, the UK-listed com- 
panies that have gone the 
whole hog, and formally 
named US houses as their 
bankers of record, are few ami 
v anishing Goldman Sachs, 
listed as Racal Electronics' 
adviser, is hard pressed to 
come up with further names. 

The more general pattern is 
far large UK companies, such 
as Allied, to retain a UK 
adviser while also building a 


fflB i plAmmt aaffl fr Qg 

investment banker says that 
hfS Anwipni^y . -hringw. -wftfapft Y 
knowledge, advanced. t®ch_ 

niques and an ~ inijarnatkiai^ 

perspective; but' be co&oedea 
that the traditional 4JR raer- 
chant bank has ’Tristery^and a 
knowledge of tine bond;-. ~ - 

What is more,: a pool of 
advisers can provide, useful ’ 
options far a company w he n 
ane is “conflicted oat" - farced 
to turn down a cheat's bust 
nqss because it ;is. acting on:., 
behalf of a competitor. 

Above all, it is ' UK. ooBopfr 
nles’ acquisition farays'hito 
the US or continental Euro- - 
pean market that have ffim 
provided the opportunity far 
Interlopers. Goldman's : secfac- 
tian of Reckitt fflusttatesfer: 
classic scenario: a US invest- . 
mart hawk advising nn ar pur- ’ 
chase in the US, getting K&fbot 
in managarorert 's dOQT apd 

p Hrhiwg fay la te r business. . 

“Relationships are important 
but you cannot, xest-'ori .year 
laurels and -expect the business 
to come to you/ saysMrWfH 
Samuel, head of corporate. 
finance at Scfcroders, the UK 

mrerhant hanlr 

But established adytaera'ani 
also becoming better at facili- 
tating the International ambi- 
tions of their clients. Warburg 
ha« as many corporate fhwmpa ■; 
employees in New York today 
as it had in London in the 
early 1980s. 

A decade ago an acquisition - 
in the US would have -beau 
handled by a local bank. Botin . 
the last month Warbtxxg 
escorted three UK companies, 
into the US in deals worth, 
$3.4bn (£2.07bn)-Or perhaps 
Warburg chaperoned them: at . 
least these three will not be - : 
meeting any new banks. 

But investment banks, can 
also seduce from the other side' 
of the table. Goldman made 
contact with Allied through - 
advising Domecq of Spain, its 
target earlier this year, . . 


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THE SOUTH AFRICAN BREWERIES LIMITED 


- » 


(Incorporated in the Republic of Sooth Africa) 
No. €9/16025/06 


ABRIDGED INTERIM REPORT 

for the six months ended 30 September 1994 


Turnover 

Grows 14% to exceed R12.9 billion 

Trading Profit 

Rises by 19% to exceed R1.1 billion 

Profit after taxation 

Up 24% for the half year 

Cash flow from operations 

Over R1 billion for the six months 

Attributable earnings 

Improve by 21% 

Dividend per share 

21% increase 

Prospects 

The short term outlook for the economy is for continuing 
moderate growth.The Group’s aim is to maintain the rate of 
improvement in earnings and dividends at present levels 
for the remainder of the financial year 


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INTERIM DIVIDEND 

The Directors have declared an Interim dividend of 47.0 cents per ordinary share, on account 

Ih TSEE 7»K ,n ?» 31 MarCh 19 ? 5, in respect of on! y those ordinary shareholders registered In 
the boote of the Company at the dose of business on 18 November 1994 (“the record date*) 

^ i paJd ordinary shares 'n Jieu of such dividend are not allocated and issued 
as detailed nereanei: 

Nw fuify paid ordinary shares in the Company wilt be issued only to those ordinary 

°" "It? 00 ? date wh0 d0 not e'ect in respect ot all or part of M 
shareholding on or before 15 December 1994. to receive the interim cash dividend. 

TEHUS OF ISSUE OF ORDINARY SHARES IN UEU OF THE INTER HI ORDINARY CASH DIVIDEND 

SSLS paid h ord,nar y ln the Company will be issued to ordinary shareholders 

registered on the record date at a price of R93 per ordinary share in lieu of the final cash 
on * a ^ ^ares for every So ordinal sh^s hdA un^s 

shareh0,der ® tecte In aspect of all or part of a shareholding by no iSer than 
15:00 Thursday 15 December 1994 to receive the interim cash dividend 

Fractions of ordinary shares will not be issued and shareholders will receive the cash eauivalent 
of such fractions as a residual cash dividend. ^ 

Listing 

Subject to approvals of The Johannesburg Stock Exchange (“the JSE") and the London Stock 
Exchange (“the LSE"), the listing of the new ordinary shares on the JSE and LSE will commence 
on Wednesdays 21 December 1994. 

Documentation 

A circular containing full details of the share issue, together with an election form will be posted 
to shareholders on or about 25 November 1994. Shareholders wishing to elect' to receive the 
interim cash dividend will be required to return their completed election farms to the Company^ 
transfer secretaries, to reach them by no later than 15:00 on Thursday, 15 December 1994. 

Posting of dividend cheques and share ce r ti fic a tes 

it is expected that dividend cheques and share certificates in respect of the new ordinary 
shares will be posted to shareholders on or about 21 December 1994. 

A further announcement will be made on or about 21 December 1994 reporting on the 
number of ordinary shareholders who will receive new ordinary shares or the cash dividend, 
as the case may be. 

2 Jan Smuts Avenue Johannesburg 2001 Republic of South Africa 



■- 


0 


Copies or the interim Report, which contains full particulars ot the dividend, will be posted to 
registered Shareholders and can be obtained from the London Secretaries^ Johannesburg Consolidated 
investment Company (London), Limited. 6 Sf James £ Place, London SWIA 1NR 



*r 


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FINANCIAL, TIMES FRIDAY NOVEMBER 1 1 1994 


25 


i 




COMPANY NEWS: UK 



Sales expansion buoys 
Oxford Instruments 



Traun HunpMee 

Peter Williams: soundly based recovery may be in prospect 


Restructure weighs on Staveley 


By Paid Taylor 

Strong sales growth and 
further margin improvement 
helped Oxford Instr uments , the 
advanced instrumentation 
group, report a 54 per cent 
increase in interim profits. 

The pre-tax figure rose from 
£5.07m to £7.8 lm during the six 
months to September 25 on 
turnover up 13 per cent at 
£55.1m (£48. 6m). 

Sales in Japan, where the 
group set up marketing 
operations in July 1991 and 
now employs 35 people, grew 
strongly and accounted for 10 
per cent of the first-half total, 
against 6 per cent last ti pie . 

Earnings per share increased 
to 10.4p (6.6p) and the interim 
dividend is lifted to 1.7p (i.5p). 
The shares rose 20p to 329p. 

Mr Peter Williams, chair- 
man, said the outcome 
reflected “a continuation of the 
steady improvement in trading 
conditions in most of our mar- 
kets. New orders have 
Increased consistently over the 
last 18 months suggesting that 
a soundly based recovery may 
be In prospect" 

Operating profits in the sea- 
sonally weaker first half more 
than doubled to £4.Q2m (£l.9m) 
as margins expanded from 4 
per cent to 7 JS per cent 
Mr Williams noted that the 


analytical systems businesses 
Were now making a material 
contribution alongside continu- 
ing strong performances from 
operations in its core technol- 
ogy of superconductivity - 
Research Instruments, Nuclear 
Magnetic Resonance Instru- 
ments and Superconducting 
Technology. “In the second 
half we expect this trend to 
continue," he Mid , “and in the 
operations most affected by 
recession - Plasm Technology 


and Medical Systems - there 
are also encouraging signs of 
recovery". 

Income from the 49 per cent 
stake in Oxford Magnetic Tech- 
nology, the magnetic reso- 
nance imaging joint venture 
with Siemens, increased to 
£3.43m (£2£tm). 

Despite funding additional 
working capital requirements, 
the group ended the period 
with net cash of pi 4 3m, com- 
pared with £7.85m at March. 


Packaging 
helps Porter 
Chadburn 

The completion of its staged 
withdrawal from consumer 
products and a sharply 
improved showing from pack- 
aging operations saw Porter 
Cbadburn swing back into the 
black is the first half. 

Turnover from con tinning 
operations in the six months 
to September 30 rose from 
£38.7m to £42. 6m, for operat- 
ing profits of £2. 17m (losses of 
£62,000), including £2. 15m 
(£1.08m) from packaging as 
the business benefited from 
legislative changes in the US 
requiring many customers to 
redesign their labels. 

With no exceptional this 
time and a reduced interest 
burden, pre-tax profits 
amounted to £ 1.62m, against 
losses last time of £1.43m and 
a deficit of £l72m for the full 
year. 

The disposal of the con- 
sumer products side - com- 
pleted in Jane with the sale of 
the Leeda fishing tackle busi- 
ness - coupled with "strin- 
gent" working capital con- 
trols, particularly in the 
US. helped cat bank borrow- 
ings from £9.1m at April 1 
to £2.6m. Gearing dropped 
from 151 per cent to 59 per 
cent. 

Earnings per share were 
1.42p (losses of 1.72p), but the 
interim dividend is again 
omitted. 


By Richard Wotffe 

Staveley Industries, the 
measurement, mechanical 
engineering and minerals com- 
pany, yesterday announced a 
decline in half-year profits as it 
continued to restructure its 
weighing division. 

The company, which also 
owns British Salt, reported pre- 
tax profits of £7 .lm (£74m) on 
turnover of £l60m (£164. 6m) 
for the half year to October 
l. 

The shares dropped 12p to 
194p. 


Parkland Group, the woollen 
yam and worsted cloth maker, 
saw pre-tax profits fall from 
£970,000 to £950,000 in the six 
months to September 2, after a 
difficult second quarter. 

However, profits on continu- 
ing operations, after taking 
account of the sale of its inter- 
est in Company Image, 
improved by 7 per cent to 
£l.Q2m. 

Mr Denis Greenwood, chair- 
man, said the second quarter 
was characterised by late con- 
tracting from many large cus- 
tomers and longer term con- 
cerns about raw material price 
pressures. 


Net interest charges jumped 
57 per cent to £i.im (£700,000). 
Gearing rose from 29 per cent 
to 41 per cent as capital expen- 
diture increased to £6.lm 
(3.7m). mainly on new manu- 
facturing capacity in the US. 

This is part of a £10m reor- 
ganisation package which will 
transfer weighing production 
from California to Minnesota, 
and end tbe production of bag- 
ging systems in Germany. 

Mr Roy Hitchens, chief exec- 
utive, said: “The reorganisa- 
tion is on plan in every 
respect: in terms of time scale. 


“Although this very demand- 
ing tra ding environment still 
prevails in many of our mar- 
kets, order levels and produc- 
tion have improved substan- 
tially in recent weeks," he 
added. 

Parkland also announced 
that it was paying £110.000 in 
shares to acquire Pirthmill, a 
textile importer. In addition, 
£40,000 loans to the vendors 
will be repaid on completion. 

Turnover fell from £29.3m to 
£25.8m. including £1.35m 
(£3. 8m) from discontinued 
operations. Earnings per share 
were 102p (10.3p) and the 
interim dividend is held at 2p. 


cost reduction, and the con- 
struction of the new facility." 

Turnover from the measur- 
ing division fell to £72.9m 
(£77.7m) but operating profit 
improved to £1.9m (£1.2m). 
Reorganisation of the Weigh- 
Tronix weighing division is 
expected to finish by the end of 
the financial year. Chronos 
Richardson, the bagging and 
batcb-blending systems busi- 
ness, is planned to be fully 
reorganised In 12 months. 

The mechanical and electri- 
cal services side lifted turnover 
to £75m (£68.7m) as the mainte- 


By Richard Wolff© 

London Insurance Market 
Investment Trust, the largest 
Lloyd’s investment trust, yes- 
terday announced a 15 per 
cent increase in its underwrit- 
ing capacity, alongside its first 
interim results. 

UMITs maximum capacity, 
which is allocated to 101 syn- 
dicates managed by 33 agents, 
rose from £502J5m to £58flm 
for 1995. after a valuation of 
its funds on August 31. 

It is one of 25 new corporate 
capital groups which under- 
write about £1.6bn of 
premiums out of Lloyd’s total 


nanc e business expanded cater- 
ing equipment services. How- 
ever, pressure on margins in 
contracting left operating 
profit at £100,000 (£500,000). 

The minerals operations, 
which supply more than half of 
the UK salt market, raised 
turnover slightly to £17.8m 
(£17.110), after improved sales 
of compacted products. Operat- 
ing profit dipped to £6.2m 
(£6.4m). 

Earnings per share fell 6 per 
cent to 4.6p (4.9p) but the 
interim dividend is maintained 
at 2.3p. 


capacity of £KL9bn. 

Pre-tax profits were £4. 97m 
on investment income of 
£5.73m in the six months to 
September 30. Under Lloyd's 
three-year accounting conven- 
tion, Income for the period 
does not include results from 
underwriting. 

Mr Jonathan Agnew. chair- 
man, said underwriting 
remained favourable this year 
with stable premium rates 
and satisfactory levels of 
claims. 

Earnings per share came out 
at 1.42p and the board 
declared an interim dividend 
of lp. 


Difficult second 
quarter at Parkland 


LIMIT underwriting 
capacity rises 15% 




U'.S LIMITED 

PORT 

umber 1S94 



• The weekday FT Is read by 139,000 senior business 
people hi Great Britain 

» More UK business people read the FT than any other 
national daBy newspaper 

• Mom than half of Europe's top Chief Executives read 
the FT 

• The FT reaches more Captains of Industry in Great 
Britain than any other national daily newspaper. 


For a foil editorial synopsis and dstaBs of available 
advertisement poaHona, please contact: 


Pat Looker or Brian Heron on 

Tab 081834 9381 fine 0618329248 
MnriiBAhB 
queen Street 
IHnilmtnr — -- 

oMeegwMKiorocJfla&aKSisss; cor 1992 


FT Surveys 





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cnac Pacific Finance limited 

USD20<MHM,«W 
GearaUteed Floating Rate Notts 
dae Nov 1997 gnsrsateed by 
CfflC Pacific Limited 

Lb accordance with the terms end 
conditions of the Notes, tbe rate of 
Interest applicable tor the interesr 
period Nov 8, 94 to May 9. 95 is 

& 5£25 pcs per annum. 

Interest payable on May 9, 95 per 
Nob of USDSMWO. USDltttfOO and 
USD500.000 will be USD1.&58.85, 
USD3.317.71 and USD3 6,588-54 
respectively. 

Agsst 

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26 


FINANCIAL TIMES FRIDAY NOVEMBER I I 1994. 


COMMODITIES AND AGRICULTURE 


India aims for sugar self-suficiency 


By Shiraz Skflnia in New Delhi 

India expects to increase its 
sugar production to 12.2m 
tonnes from 9 An tonnes and to 
be self-sufficient in the com- 
modity in the season starting 
October this year. This 
reverses a steady decline in 
sugar production over the past 
three years, when the country 
had to rely on imports to meet 
domestic demand. 

Mr Kalpnath Raj, the Food 
minister, said this week that 
the Narasimha Rao govern- 
ment's policy of offering remu- 
nerative prices to sugar farm- 
ers had yielded a bumper cane 
crop in the 1994-95 season. 


White sugar futures climbed to fresh four-year highs at the 
London Commodity Exchange yesterday as fears of supply tight- 
ness kept the recent rally going. 

Traders told the Reuters news agency that China. Yemen and 
Iran were each rumoured to have bought a cargo or whites 
originally destined for India. 

In late trading the March delivery position reached S370 a 
tonne, up $6.80 on the day and $39 since the start of October. 


India imported 1.9m tonnes 
of sugar this year, though last 
year's production of 9.8m 
tonnes was up by 24 per cent 
over the previous year. The 
import of lm tonnes through 
government-owned trading 
companies led to a controversy 
and a subsequent jump in 
sugar prices. 


The country’s sugar Industry 
launched a campaign for com- 
plete deregulation of the sugar 
market, saying that plant 
capacity lay idle because of the 
government's system of moni- 
toring the distribution of cane. 
The government has yet to 
decide on the issue. 

The minister said the gov- 


ernment had cleared 74 
licences for the setting up of 
sugar factories, which would 
raise sugar production by 
another 2.5m tonnes in the 
near future. Mr Rai said the 
total price payable to cane 
growers this season increased 
to Rs54.43bn. compared to 
Rs44.23bn in 1393-94. Almost 99 
per cent of the amount had 
already been paid by sugar 
mills to growers as a result of 
the government's efforts. 

The government distributes 
sugar through a subsidised 
public distribution system 
using ration cards. Sugar is 
available on the open market 
but at much higher prices. 


Tungsten shortage looms as demand grows 


By Frances WOUams in Geneva 

The world tungsten market, 
severely depressed since 1989, 
has picked up smartly this 
year, and experts are already 
worrying about a future short- 
age of the metal in the face of 
surging demand. 

Government and industry 
representatives who met for 
two days earlier this week tn 
Geneva said they expected 
strong growth in tungsten 
demand this year and next 
allied to world economic recov- 
ery. 

With many tungsten mines 
now closed, especially in indus- 
trialised countries, the extra 
demand is being met from 
stocks. But once stocks dry up 
“the market may face serious 


instability In event of a sharp 
recovery in world tungsten 
consumption", according to the 
United Nations Conference on 
Trade and Development, which 
sponsored the meeting. 

The price of ammonium par- 
atungstate, a key intermediate 
product, has doubled since the 
beginning of 1994 to around 
S93-95 per mtu UOkg) in 
Europe. This, Unctad says, has 
led the industry to consider 
reopening conversion facilities. 
However, prices of tungsten 
concentrates remain too low to 
reverse mine closures. 

World mine production of 
tungsten slumped from a peak 
of 60,426 tonnes (metal con- 
tent), in 1989 to 30,286 tonnes 
in 1993 the lowest level since 
the 1960s. That compared with 


consumption of ores and con- 
centrates of 32,967 tonnes last 
year. 

Mines in industrialised coun- 
tries are producing only a 
tenth of their output at the 
beginning of the 1980s and in 
developing countries only 
about a fifth. Even in China, 
the world's biggest producer, 
mine production has more 
than halved since the late 
1980s to less than 20,000 tonnes 
in 1993. 

Unctad says the recent impo- 
sition by the US and the Euro- 
pean Union of anti-dumping 
duties on imports of Chinese 
concentrates gives an opening 
to Russia - though it too has 
suffered from disrupted pro- 
duction. 

In the much longer term the 


outlook for tungsten is mixed, 
according to Mr Peter Johnson 
of the US Metal Powder Indus- 
tries Federation. He told the 
meeting that while industrial 
developments offered poten- 
tially important market oppor- 
tunities - notably in electron- 
ics, medical equipment, 
armaments and cutting tools - 
some traditional uses were 
likely to decline. 

Cermets and ceramics were 
increasingly used in place of 
tungsten carbide and the lon- 
ger life of cutting tools was 
reducing replacement demand. 
The US industry would also 
have to face up to the impact 
of lower spending on defence 
equipment and intense foreign 
competition in aircraft applica- 
tions, Mr Johnson said. 


Rhone Poulenc to launch integrated farming trial 


By Deborah Hargreaves 

Rhdne Poulenc, one of 
Europe's largest agrochemicals 
groups, said yesterday that it 
would start an experiment in 
Integrated Crop Management 
to run alongside its trial 
organic farm in Ongar, Essex. 

The company said it would 
monitor its use of agrochemi- 
cals and artificial fertilisers 
more closely as well as looking 
at the use of rotation systems 
and different forms of cultiva- 


tion in order to farm in a more 
environmentally-friendly way. 
“We are really taking modem 
technology and combining it 
with the best traditional meth- 
ods," an official said. 

The new study will take 
place on 24 hectares on the 
company's Bundish Hall Farm, 
which is adjacent to Boarded 
Bams where organic methods 
have been employed on 24 
hectares for the past five years. 

Rhone Poulenc has found 
that the gross margins on its 


organic sector have consis- 
tently been around half of 
those achieved on its conven- 
tional acres. Over a four-year 
period, the cumulative gross 
margin per hectare has been 
£2,557 for the organic part and 
£5,487 for the conventional 
fields. 

"All our indications are that 
the gap will continue to widen 
between the organic and con- 
ventional profit levels," said a 
company official, “with ICM 
we're looking at a refinement 


of the conventional system." 

The new ICM approach aims 
to be as profitable as conven- 
tional farming since any slight 
reduction in yields should be 
compensated for by the lower 
cost of agrochemicals and 
other inputs which will be 
reduced. 

A large cost for the organic 
land is the need to grow a fer- 
tility' crop such as clover every 
couple of years in the land's 
rotation system to improve soil 
fertility. 


Tea planters 
to suspend 
production 

India's major tea companies, 
hit by falling exports and grow- 
ing stocks, have decided to halt 
production during the three 
months to February, reports 
Reuters From Bombay. 

Traders said the industry 
had been facing a glut for the 
past two years, caused by two 
bumper crops and dwindling 
exports to Russia, once the big- 
gest buyer of Indian tea. 

“Now we are strapped with 
huge stocks, and some of that 
is of inferior quality. The halt 
in production was thus 
unavoidable.” explained Mr 
Vijay Dudeja. chairman of Par- 
amount Tea Marketing. 

According to the Consulta- 
tive Committee of Planters' 
Association, production will be 
suspended in all prime planta- 
tion areas in the eastern and 
north-eastern regions. These 
include the gardens of Assam, 
Terrai. Dooars and Cacchar, 
which account for nearly 50 
per cent of the country's total 
output. 

“We need to export at least 
180m to 200m kg of tea every 
year to prevent an uncomfort- 
able surplus, but that has 
failed to happen.” said Mr 
Dudeja. 

India's annual exports have 
not risen beyond 140m kg in 
the past two years. In the three 
years following the collapse in 
1991 of the Soviet Union, which 
had been buying nearly 100m 
kg a year, they fell by at least 
55m kg. 

That had resulted in a 12 to 
15 per cent cut in the prices of 
all good and medium quality 
teas, Mr Dudeja said. 

Traders said the situation , 
had worsened this year after ; 
most planters stepped up pro- i 
duction in anticipation of | 
higher purchases by Russia 
under a debt repayment deal. 
“The speculation, however, has 
backfired, with the Russian ! 
buying not picking up as ; 
expected," said Mr Haresh 
Parekh of tea brokers J. 
Thomas & Company. 

Traders estimate that 1994 
production will touch 770m kg, 
up from the previous year's 
758m, adding further to the ris- 
ing stockpile. 


Danish pigmcat co-ops 
study merger proposal 

Hilary Barnes reports on a controversial plan „ . 

D anish co-operative ish Crown, Vestjyske (West Bent 
slaughterhouses, Jutland), Steff Houlberg, and 

which already include Tican - pins the associated them, con^ea^ that there w2 


D anish co-operative 
slaughterhouses, 
which already include 
some of the largest pigmeat 
companies in Europe, are con- 
sidering merging to form what 
the Association of Danish 
Slaughterhouses claims would 
be the biggest pigmeai process- 
ing group in the world. 

At this stage the idea is only 
the subject of a debate among 
the farmers who own the bum- 
nesses; there have been no 
merger negotiations as such. 

If the merger takes place the 
resulting company wfll be the 
second largest industrial group 
in Denmark, with a turnover of 
between DKrSGbn and DKrfObn 
(E3.12bn-E4.16bn). 

Denmark's pigmeat industry 
has turned in an impressive 
performance since it made its 
reputation at the beginning of 
this century as a supplier of 
bacon for the British breakfast 
table, ft now claims world mar- 
ket shares of 3) to 30 per cent, 
varying by product, for Inter- 
nationally-traded pigmeat- The 
country has only 5m people, 
but produces 20m pigs a year, 
exporting SO per cent of the 
pigmeat produced. Pigmeat is 
Denmark's largest single 
export product, worth about 
DKrlSbn in 1993, about 8 per 
cent of the country’s merchan- 
dise exports. 

The industry owes its suc- 
cess. say the Danes, to the co- 
operative structure, which 
farmers control all the 
way from the pig sty - through 
breeding and processing to 
sales and marketing. 

“We are able to produce raw 
material of a uniform High 
quality, and have a system of 
production which meets the 
consumer's demand for pure, 
healthy and nou rishing meat 
products,” says Mr Bent Sloth, 
pig farmer and (Chairman of the 
Association of Danish Slaugh- 
terhouses. 

The industry has rational- 
ised rapidly. Three decades ago 
there were almost 100 co-opera- 
tive slaughterhouse companies; 
now there are just four - Dan- 


ish Crown, Vestjyske (West 
Jutland), Steff Houlberg, and 
Tican - pins the associated 
companies that process meat 
intn hams, sausages and other 
value-added products. 

Mr Sloth favours the merger, 
which in itself is a sign of how 
the idea has piata »red. His pre- 
decessor as chairman was 
voted out in the mid-1980s for 
supporting a proposal for a pig- 
meat monopoly company. 

"It is time for the Danish pig 


Bent dandi Lassen chairman 
of Danish Crown, 4he largest of 
them, concedes that there 
be advantages in terms of 
international sales and market- 
ing strength, as weH aa econo- 
mies of scale to be esflbtfed. - 
But couhterfwlancmg theqe 
advantages, - ht his view, are 


a gigantic enterprise. 1 
Mr Bent Maribo, chainnan’of 
Steff Hoidberg, ranking fluid 
flTnnng the four, is uneqidvo- 


Dastinatton 


France 

Germany 

Italy 

UK 


Danish Pigmeat Ejqwrts 1998 
Tonnes 


90,445 

176.023 

68,304 

145,431 


y*i * 
(MWonDKfl 

-1,238 
' -4463 
'1,184 
. 4347 


139£20 

54472 


industry to give priority to 
competing with the pig produc- 
ers of other countries rather 
than with each other. ” Mr 
Sloth declares tn an issue of 
the slaughterhouse associa- 
tion's magarinp devoted to the 
merger issue. He argues that if 
the Danish companies do not 
mage with each other one or 
other of them may well merge 
instead with a foreign com- 
pany. “But if the supplier 
chain Is extended to other 
countries, where the same 
quality guarantees cannot be 
provided, we risk losing all the 
advantages which the Danish 
industry enjoys.” 

Hie does not think there is 
any risk of loss of commercial 
dynamism if domestic competi- 
tion is largely eliminated. The 
company would be measured 
by its ability to pay its former- 
suppliers a better price for 
their pigs than the coopera- 
tives' foreign competitors are 
able to pay theirs, he argues, 
and this would keep the com- 
pany on its competitive toes. 

The chairmen of the four co- 
operatives are less sure. Mr 


cally opposed to a one-com- 
pany solution. "It 'will not 
mean a strengthening, but a 
weakening, of the Danish saw 
position,” he says. .Interna- 
tional buyers, especially In 
Japan, which is the most valu- 
able export market fin; Danish 
pigmeat, want to have a choice 
of suppliers, and if there Is. 
only one Danish company, 
they will oxerdse their choice 
by buying more from Taiwan, 
the US and France, he warns. 
For similar reasons, Danish 
buyers will begin buying a 
higher proportion of their meat 
from abroad, while the private 
Danish suppliers, who account 
for about 4 per cent of the mar- 
ket; wifi gain market shares as 
wdll. 

Domestic competition, says 
Mr Maribo, is one of the factors 
which has made tin* Danish 
slaughterhouses among the 
most efficient in the world. 
Eliminate this competition 
“and measuring success will be 
diffi cult” he says. Mr Egon 
Krlstensen, chairman of 
Vestjyske, agrees. “Monopolies 
haven’t always been the most 


COMMODITIES PRICES 


BASE METALS 

LONDON METAL EXCHANGE 

{Prices from Amalgamated Metal Tracing) 

■ ALUMINIUM, 99.7 PURITY {Spar tome) 


Precious Metals continued 

■ GOLD GOMEX 1100 Tray ac; S/tray ogj 


AA'f 


GRAINS AND OIL SEEDS 

■ WHEAT LCE(E per tonne) 






IATTCD BAR 


SOFTS 

■ COCOA LCE (Ertoruw) 


MEAT AND LIVESTOCK 

■ LIVE CATTLE CME mCGQbs; centsribq) 


Close 1843-44 

Previous 1846-47 

HKfll/toW 1845 

AM Officid 1844-46 

Kerb dose 

Open ML 259,097 

Total daJy turnover 74,014 
■ ALUMNIUM ALLOY (S par tome) 


3 mtfu 
1855-58 
1858-59 
188071829 
1854-66 
1847-8 



Salt 

o*r* 


Open 



Sett 

Dnyta 



(teen 



Sod 

Day's 



Open 



Sen Bay's Open 



Pri* 

dungo 

Mgti 

km Ini 

VoL 


price 

change 

tSgfi 

Low 

M 

«W 


price i 

change 

ffigh 

Low 

tat 

VM 


price change Ugh Low lot 

W 

Ha* 

3653 

+1.4 

• 

- 

- 

Nat 

10330 

-CEO 

10330 

10330 

506 

73 

Dec 

937 

-2 

943 

937 

19269 

874 

Dec 

70.475 +0325 7O5C0 70.150 29.429 

9372 

Ok 

3853 

+M 

366.4 

3843 82.505 21302 

tan 

104.50 

-0.80 

10500 

10460 

1338 

91 

Mar 

963 

-1 

966 

961 

<3.147 

1.3M 

Fed 

63750 *035) E9J7S 6333) 22741 

5323 

Jan 

3873 

♦1.4 

- 

- 23.745 

1.680 

MV 

10840 

-035 

10730 

10840 

1651 

49 

May 

971 

-2 

974 

971 

14.064 

103 

Apr 

69325 +0.025 039) 69300 15330 

1344 

Feb 

3693 


3903 

mo io.ni 

70 

um 

10860 

•fl.TS 

10895 

10860 

1330 

28 

JU 

984 

-1 

sa? 

865 

6.600 

22 

Jon 

a £26 *0.100 68650 65.425 5.195 

222 

Apr 

3933 

♦1.4 

3333 

3922 10.156 

964 

JM 

11030 

+020 

111.15 

1*060 

120 

25 

Sep 

997 

- 

1003 

897 

12.612 

S3 

Aug 

64300 +0.100 64350 64.150 1304 

52 

Job 

397.0 

♦1.4 

397.1 

3963 5214 

320 

Sap 

9330 

-035 

9330 

+365 

43 

2 

Dec 

1012 

-1 

1016 

1011 

9-735 

71 

Oct 

65.175 +0325 65.175 68175 305 

11 

Total 




165721 

28,197 

Tefal 





MS4 

318 

Total 





112275 2301 

Total 

74311 13379 


PLATINUM NYMEX (50 Tray 0*4 S/troy oz.) 


WHEAT C8T {5.000X1 rrfn; oantefflORi busheQ 


COCOA CSCE UP tomes: S/tonnea) 


LIVE HOGS CME «0,CG0te3; cent&flbs) 


1015-20 1844-46 

1830-40 1860-70 

1850/1846 
1815-20 1845-50 

1845-8 


887-68 

684-65 

862/681.5 

661.5-62.0 


883-84 

8705-80.0 

884/888 

6775-780 


Close 
Previous 
HgMow 
AM OffidM 
Kart) done 
Open hit 

Total duly tixnowr 
■ LEAP ff par tonne) 

Close 
Prevtauo 
HgMaw 
AM Official 
Ketb dose 
Open ML 

Total daily turner*! 


Ctaw 7280-70 7381-85 

Previous 7305-16 7425-30 

Hflhflow 7450/7320 

AM Official 7280-81 7405-10 

Kerb dose 7380-6 

Open ML 72,775 

Total dally turnover 12353 

■ TIN (5 per tonne) 

Ooae 6075-85 817080 

Previous 8110-20 8200-10 

H 9 M 0 W 8050 822016080 

AM Official 6045-50 0140-45 

Kerb dose 8110-20 

Open It 20,845 

Total da8y turnover 3225 

■ 2NC, epecfal high grade {8 per tonne) 


Jan 

411.1 

+Z2 

4115 

4080 18349 

9.086 

Deo 

378/6 

-1/4 

3820 

378/2 30564 

15.714 

Dec 

1290 

•1 

1293 

1277 

13588 2,638 

Dec 

33£S +0.725 33.775 33500 16,135 

2660 

Apr 

4186 

+23 

4163 

4133 7,428 

1522 

MW 

391/0 

-I/O 

394/0 

390/0 

27,168 

9,391 

Mar 

1329 

+2 

1333 

1316 34.003 3511 

Fob 

37.300 +0525 37550 

38850 

10375 

1,967 

JM 

4280 

+33 

423.0 

418.0 1554 

57 

M>y 

370/0 

+0/4 

371/6 

368/4 

4361 

64S 

May 

1354 

- 

1355 

1346 

8.363 282 

Apr 

37.825 +0.425 37J75 

37.450 

5J242 

558 

Oct 

425.1 

+33 

- 

900 

1 

JM 

337/6 

- 

340/0 

337/4 10,484 

1549 

JM 

1379 

-3 

1380 

1368 

3,687 318 

Jm 

42375 +0Z75 43500 

42550 

2606 

176 

Jon 

4281 

+23 

- 

10 

• 

Sep 

343/0 

+0/4 

343/4 

343/0 

309 

6 

Sep 

1402 

-3 

1405 

1395 

1,499 

Aug 

42.450 +0 300 42.450 

42100 

527 

24 

Total 




28,139 10568 

Dec 

353/4 

+1/0 

354/0 

353/4 

156 

3 

Dec 

1432 

-3 

1423 

1423 

5563 

Oct 

39.450 +0550 31600 

39.400 

407 

19 

■ PALLADIUM NYMEX (100 Tray on S/tray oz.) 

ToM 





7356B 27,708 

Total 





71585 6555 

TMM 



38307 

S4S3 



689-70 

HO* 

518.1 

43,414 


Dm 

5175 

6^88 


J» 

519.8 



Mar 

Ho* 

5Z&9 

331.7 

7280-70 

7381-85 

JM 

SSTJS 

7305-18 

7425-30 

TOM 



DSC 158.75 4055 15680 15525 4,241 901 

Mar 157.75 +0.45 157.70 15650 3,163 144 

Jm 15860 +020 - - 409 4 

Sv 15025 +020 31 

Tow 7,904 1,049 

■ SILVER GOMEX (100 Tray oz.; Cente/troyozj 
Ho* 516.1 +5.7 511.0 51 LO 50 50 


122*73 49*17 


ENERGY 

■ CHWB OIL NYMEX (4£0(X) US gafla Mgffljj} 
lakat Bar's Open 


dose 

1140-41 

11643-85.0 

Pnwloua 

1137-38 

1160^1 

HkjMow 

1133 

1160/1160 

AM Official 

1132^5-33.0 

1157-68 

Kaito MOW 


1151-2 

Open rt. 

111^74 


Total dafly tunover 

11,130 


■ COPPER, grade A (5 per tame) 


Close 

2e»e7 

2685-86 

Previous 

2872-73 

2846-48 

ttgh/tow 

2888 

2S88/2B29 

AM Offlatol 

2866-68 

2648-47 

Kerb dose 


2853-4 

Open teL 

222.700 


Total dafly turnover 

84.103 


■ LME AM OfBctaZ £/$ rate: 1^070 


LME Cjoelng E/8 rale: 1.6000 

Spa 1.5890 3 mew 1.5680 8 m#w1J958 9 INhKl5937 
■ UGH GRAPE COPPER {COM EX) 

Day's Opra 

One dungs Ugh tow tat not 
Mo* 12430 +0.70 1200 12580 1.511 2S4 

Dec 12535 +4L65 12380 122.35 35267 4860 

Jan 122.76 +0.78 12250 1225D 932 9 

M 122.10 +075 - - 965 3 

Mar 121.45 +0.75 121 JO 12060 11,896 2.428 

Apr 11880 -080 11980 11980 722 4 

TOM 81,681 10,158 


PRECIOUS METALS 

■ LONDON BULLION MARKET 
(Prices supplied by N M Hotfiadjjj 


On 1786 -020 18.19 1743 76468 42,064 

■tan 1741 -017 1011 17.77 85403 25426 

M 1742 -016 17.97 17.71 42.109 10825 

Mar 17J4 -0.18 17.BS 1788 24,796 4406 

Apr 17.73 -012 17.73 17.65 17494 780 

Nay 1749 -013 1749 1749 12472 14 m 

Ta*U 390901 01496 

■ CRUDE OIL IPS ff/band) 

Latest Hay'S Opm 

pries change Ugh Lou tat M 

Dae 1097 -022 17.15 1645 63499 16,458 

4m 1644 -012 1074 1054 67,263 17,050 

FM 1643 -046 1647 1643 22442 4J57 

Mar 1045 -004 1048 1035 12,478 1443 

Apr 1035 -008 1647 1644 5,132 235 

May 1649 3484 448 

Total 185418 40434 

■ HEATING oa. HfMEX (4ZJB0 US gain; c«g qaltaj 

Latest Day's Open 

price change Htfi Lou M VM 

Dec 5045 -022 5045 5000 42463 10411 

tan 9090 -019 51.10 5055 37,423 5439 

M 5140 -014 5140 51.18 22813 1,185 

Mar 51.10 -004 61.10 5065 12499 828 

Apr 9030 +018 - 7,687 113 

May 4945 +018 - - 4438 332 

TBtal 153,995 18472 

■ GAS oa. FE ff/tanffl) 

Sod Day's Open 

price change Ugh lu U M 

Dae 15440 +025 153J3 151 .75 35.042 9442 

taa 15640 -025 15540 154.75 21,565 3,188 

Fab 15075 -050 15025 154.75 10124 663 

Mar 15845 0.75 155J5 15440 7493 552 

Apr 104.76 045 16340 15325 1233 61 

Jm 15340 -026 16340 152.75 714 

Tetri 101492 22.233 

■ NATURAL flAS NVHEX flQOOO mnflMa; ttamfttL) 

. Latest Day'i Opm 


Gold (Trey oz.) 
does 
Opening 
Morning fix 
Afternoon Ac 
Day's High 
Day's Low 
Previous dose 
Loco Ldn Mean 1 


2 months 

3 months — ~ — 
SBvwr Ft* 

Soot 

3 months 
B months 
1 year 
Gold Cotes 
KTugamd 
Maple Loaf 
New Sovereign 


S price 
384.10084.40 
383.70-384.10 
38440 
38440 

38540-385.60 
38340-38340 
38440-38440 
Gold Lending Rate* 
— 4.57 6 months . 

—448 12 months 

—444 

prtray OZ. U 
31946 
32446 
329.40 
34145 
$ price 
388-389 
38S.00-397.4S 
90-93 


C equ hi. 


pries change 

Wgh 

loir 

U 

VM 

Deo 

1JBS +8814 

1310 

1.771 27,777 11255 


Jon 

1-930 +0014 

1240 

120® 23,847 

5JB8 

239141 

240200 

F» 

1325 +0319 

1240 

1210 

14ZM 

2,131 

Kir 

1.895 +0019 

1210 

1270 12,701 

723 

Apr 

1860 +0014 

1265 

1260 

7,146 

679 


MW 

1SGB +0007 

1270 

1268 

8,847 

279 


Total 



142,145 22.184 

(VeUS« 

■ UNLEADED GASOLINE 




NTKX (42300 us gffi&; cftlS gtflt) 



-5.64 


Utart Doyta 



taton 




price chaope 

Hgh 

LOW 

tel 

«M 

S eta oqUK/. 

Dec 

5720 +075 

5725 

5680 

28.408 

15289 

81300 

Jan 

5520 +022 

SUSQ 

5428 

20.463 

7,050 

52900 

M 

5435 -003 

5420 

54J5 

7265 

2J78 

528.15 

Mte 

6500 -018 

5520 

5425 

4,117 

285 

54830 

*fr 

5625 -018 

■man 

56.10 

5228 

382 

£ equfv. 

MW 

57.15 -006 

- 

- 

1254 

87 

240-243 

TMM 




28,133 


■ MAIZE CBT (5JQ0 bu mte; centa/56tt> bushel) 

Dec 21 B* +OT 222A) 218)4109,117 28421 
Mar 231/2 +14 233/4 230/D 68,687 11.034 

May 238/6 +0/4 240/4 2374 27.592 2,701 

JM 243/6 +0/4 245/D 242/9 31512 4479 

S*p 240/4 +0« 249/4 24BA 3,422 278 

DOC 253/2 +0/4 Z54/D 252/2 16,777 2JX7 

Total 292491 48061 

■ BARLEY LCE (E per tonne) 


nw 

96.00 

-1-25 

5 

- 

Jan 

10120 

-0.50 

479 


Mar 

10420 

- 

130 

- 

M»y 

10545 

-025 

48 

- 

Sep 

92.70 

■025 

20 

- 

Nw 

9420 

-025 9420 9420 

18 

30 

TOM 



098 

a 


M SOYABEANS C8T {50OOCU nDn; omMOffi bushel) 

Km 556/4 -2/6 5624 557/6 7445 10453 

Jan 568/E -3/2 573/4 SSB/D 56,568 33494 

Mr 5792 -3/D 583/5 578/4 2B494 6488 

May 587/2 -3/2 591/2 997/0 13463 2,717 

JM 503/2 -2A 597/2 5SM> 22,111 2448 

Aag 698/6 -1/2 599/4 596/4 1428 91 

TMM 138410 57425 

■ SOYABEAN OH. CBT (aO.OOatgc cortfa/b) 

Sec Z7JB -032 2840 27.75 38496 11474 

Jan 2641 +M0 2745 2640 22490 8449 

■ar 2042 -030 26.48 2000 17402 0404 

May 2139 -028 2640 2138 13416 2403 

JM 2441 -041 2130 2440 7,069 2494 

A09 24.70 -023 2540 24.70 1447 333 

TMM 194402 30,713 

■ SOYABEAN NEAL CBT (100 tom; S/ton) - 


Dec 

1594 

■0.1 

1883 

1582 35,635 

4228 

taa 

1612 

- 

162.0 

1602 2020Z 

2231 

Mar 

165.4 

- 

1892 

1852 17243 

2246 

May 

170.1 

■8.1 

1702 

1892 

0,714 

913 

Jut 

17*2 

-82 

175.7 

1742 

9212 

1240 

Mg 

1772 

- 

1782 

1762 

1216 

371 

Total 




181,168 13.7D5 

M POTATOES LCE (C /tonne) 




Mar 

1052 

. 

. 

- 

- 

. 

Apr 

MB 8 

■07 

242J 

2382 

1.484 

122 

May 

2502 

* 

. 

- 

- 

. 

Jon 

2502 

. 

- 


- 


Total 





1484 

122 

■ FREIGHT pFFEX) LCE (SlO/teCex pafcti] 


BOV 

1646 

+18 

1850 

1840 

252 

59 

Dec 

1790 

+45 

1790 

1755 

432 

136 

tan 

1715 

+35 

1715 

1690 

1282 

8/ 

Apr 

16S2 

♦12 

1855 

1646 

896 

48 

JM 

1480 

+7 

. 

- 

132 


JOH 

1610 

+70 

• 

- 

17 

. 

Total 





221 1 

329 


Quo 

PtW 





an 

1832 

1830 






Wool 

Prices continue to fluctuate without 1 posffiva 
oven* trend, at toast in the short term. A peak 
in mid-September was tolowed by a stop 
satback. but recovery from this fated to estab- 
Sah a new peek betara the marital fefl back 
MfgMiy test week. Ufa minor downturn also 
tafled to develop twther and Austria's Eastern 
market indcator rose 9 cents to 790 durteg this 
weak's sales. The New Zeeland market eased, 
with me Indcator there down by 14 cents to 
643 NZ cento a kg. The US deOnr'e fluctua- 
tions. which have relevance for curenctoB to 
wool producing countries as wei as lor wool 
and turtle trade mom widely, have tended to 
push UP Prices to many wool taorfie manufac- 
turing countries but have at the same time 
tended to make buyers further down the trad- 
teg few even mare reluctant to operate. 


■ COCOA (tCCO) (SORVtanne) 

riOV 9 Price 

Dafly 96832 

■ COFFEE LCE ISriorreJ 


PORK BELLIES CME (40.000ttH; cents/ltej 


HN 

3455 

-13 

3460 

3430 

387 

103 

Jan 

3505 

-12 

3520 

3466 12,464 2287 

Mar 

3456 

-30 

3485 

3425 

7259 

1287 

May 

3423 

25 

3430 

3400 

3.287 

196 

JM 

3403 

-10 

3405 

3380 

12« 

223 

ten 

Total 

3388 

-17 

3396 

3370 

1,790 230 

27238 4286 


41.575 +0475 41450 41.150 8.125 1455 

41800 +0.725 42.GS0 41325 14*2 236 

42.700 +0460 48090 42400 321 T5 

43.400 +0400 43450 41350 347 13 

42450 +0525 4Z500 41350 85 S 

10,120 12» 


LONDON TRADED OPTIONS 

Strflre price $ tame — Coils — — Puts — - 


■ COFFg'C' CSCE (37^00toa; cantaflba) 

Dec 1 63.® -105 18840 16115 7,931 4.191 

tor 18895 -ISO 19140 16825 13^55 1952 

May 191.20 -2.75 19175 19100 5JS3 333 

M 19190 -185 19475 19190 1,996 241 

Sap 19425 -195 19770 19475 1JJ71 101 

Dee 194.70 -170 19800 19800 971 72 

Total 31,004 8891 

M uwiiE (ICO} (U3 centa/poraxQ 

Knr 9 Price Pm*, day 

Comp, dafly 17935 181.34 

15 riqr average 17931 18030 

■ No7 PRBWUM RAW SUGAR LCE (cents/lta) 


■ ALUMINIUM 
(99.7%) UME 

1800 

1850 

igog 

R COPPER 
{Oado A) LME- 

2800 

2850 — 

2700 

■ COFFEE LCE 

3400 

3450 

3500 


Jan Apr Jan 

95 132 51 

69 107 75 

48 88 104 

Jan Apr Jan 

121 117 55 

84 96 77 

70 77 103 

Jen Mar Jan 

252 310 147 

22S 291 170 

200 274 195 


Jan 

1300 

_ 

. 


M COCOA LCE 

Dec 

Mar 

Dec 

Ma- 

Mb- 

1343 +0.10 

- 

M 

- 

QVH 

18 

79 

6 

32 

M V 

1368 +0.10 

- 

- 560 

- 

950 

a 

56 

18 

43 

Jm 

1340 

- 

450 

- 

975 

i 

44 

39 

56 

Total 



1,110 

- 

M BRENT CRUDE /PE 

Nov 

□oc 

Nov 

Dec 


■ WHITE SUGAR LCE (S/tonne) 
Dec 37740 +7.B0 37740 38 


37740 +7.90 37740 388.90 1,731 551 

37040 +740 37040 36130 9399 1,019 

36530 +7,10 36530 35740 1406 073 

357.00 +820 35730 350.10 1888 21 B 

33100 +880 32830 32740 1360 62 

331.10 +890 32740 32740 62 60 


1650 

1700 

1750 


45 2 

27 39 


DCt 33100 +880 32930 32740 1360 62 

Dec 331.10 +890 32740 32740 62 60 

WM 18440 1412 

■ SUGAR If CSCE Uia.OOOfla; centa/tw) 

Mar 112S +0.11 1128 1104101360 7,321 
* *1 1341 +0.10 1342 1111 29,169 1.985 

Jd 1111 +035 1114 1197 18317 1,178 

Oct 1145 +0.05 1150 1247 16,447 1,187 

Mar 1105 +035 1105 1235 2366 151 

May 1110 +810 1110 1110 tS9 

Total 1 67 30611322 

■ COTTON NYCE (SO.OOOlta; cantoflbs) 

Dec 7113 +868 7155 7125 20317 5369 

Mar 7432 +037 75.19 7130 18457 2.470 

May 7805 +130 7815 7810 7,490 531 

JM 7863 +130 7890 7630 4479 326 

Oct 7135 +862 - - 616 50 

Dee 7030 +860 7035 6874 3365 118 

Total S334 B , wa 

■ ORANGE JUICE NYCE {IB.OOOtos: cenB/jbffi 

Ho* 10830 -030 10973 10875 299 15 

Jan 11245 -880 HIM 11100 14,744 M 2 

Mar 11825 880 11730 11530 5449 132 

May 119.30 -035 12030 11875 1348 47 

JM 12150 -865 - 915 5 

SaP 12815 -865 12875 12875 1,244 32 

Tfl tal 26,080 1,123 


VOLUME DATA 

Open Interest and Volume data shown for 
contracts traded on COMEX. NYMEX. CBT, 
NYCE, CME. CSCE and tPE Crude Oil are one 
day tn arrears 


INDICES 

■ REUTBtS (Base: 18/9/31-100) 

U® 10 Nov 9 month ago year ago 


LONDON SPOT MARKETS 

M CRUDE OB. FOB {per barrel/Dodl +gr- 

DubM S15.96-6.0az -812S 

Brent Blend {dated) SI 7.1 1-7.13 -0340 

Bren! Blend (Dec) 517.16-7.18 -0.170 

W.T.l (1pm est) SlB.18-8.18z -8190 

M 08. PRODUCTS NWE prompt delivay OF (tenne) 


Premium Gasoline 5170-174 

fiw 09 $157-159 

Heavy Fuel Oil SI 02-104 

Naphtha $188-171 

Jet fuel $180-181 

Otesel $181-163 

PWMaum Aigm. TW London (070 3SB arae 
■ OTHB=l 

Gold (per tray oz)* $38445 

SBver (per tray oz)f 5185c 

Platinum (per tray oz.) $407.75 

PaOaffiian (per tray 02 J SI 55. 75 

Copper (US prodj 1210c 

Lead (US prod.) 4875c 

Tin {Kuala Lun^xa) 1545c 

Tin (New York) 9POHf 

Cattle (tore weighty 11517p 

Sheep dive weigwrr* 100.81 p 

Pigs (Bve weight) 7890p 

Lon. day sugar (raw) S32S.90 

Lon. day sugar (Wte) $374.00 

Tala 8 Lyle export £31500 

Barley (Eng. lead) Unq. 

Maiae (US No3 YvmIow) 132 Jly 

Wheal (US Dark North) 1853u 

Rubber (Pec)V 85,75p 

Rubber (Jan)V 8525p 

Rubber (KL RSS Not JuQ 343.0m 

Coconut 09 (PhOJS S6fl50q 

Pahn Oil (Matey, >§ S7l0.0z 

Copra (PWI)§ S4480V 

Soyabeans (US) El BUM 

Codon Outiook'A' Index 7530c 

Wboltops (B4a Super] 440p 

C per um uteres oawnrtM steMd. p psnee/kg, 
m Mdsy da n carea/hg. y NixtfOao. v 
Q-WNOV. 2 Ore. 1 MOV. q DecUanV London Phy 
Rottentem. A BuBcn nnrtBi don. 4 Shaep { 
- Clung* on wank O Price* are lor pra 


21184 21155 2061.8 

■ CRB Futures (Base: 1967*100) 

Nov 9 Nov8 month q 

23821 23347 227.74 


o. vNov/Doc. u 
Physical. 9 OF 
ap wtegM 



CROSSWORD 

No. 8,608 Set by DINMUTZ 
ri Fl FI FI I M I — It I — IT 






#4 


ACROSS 

1 Shelley work, say, for idle 
hands (9) 

6 Aspect of champion In this 
paper (5) 

9 Was it applied to the bow in 
Nero's instrumental? (5) 

10 Go higher in best suit, pres- 
enting backside to public (9) 

11 One may tum up the volume 
to onto- (10) 

12 Money for a governess out 
east? (4) 

14 Difficult to prove, the more 
complex it is! (7) 

15 Desperate doctor takes wine 
cold (7) 

17 Non-availability of cab seen 
to be troublesome (7) 

19 Colonist who stays out of 
debt? (7) 

20 Advantage of the border (4) 

22 Settled cost of fleece? (10) 

25 Bamboozled with divine left- 
break (9) 

26 Wise man of Lytham (5) 

27 Alice at 12, say? (5) 

28 Horse slip over buffers? (9; 

DOWN 

1 Old man, for example, to call 
for silence over problem (5) 

2 But would they bring back 
Constables? (9) 

3 Soup in terms one can trans- 
late (10) 

4 Gangster Qts cowl over chim- 
ney in Scotland (7) 


5 Leisure time, possibly, for 
young Kenneth with daugh- 
ter (7) 

6 Stars, we hear, in gala? (4) 

7 Make butter with church ves- 
sel (5) 

8 Telegraphed response, you 
say, from noisy Terpsicho- 
rean? (3-6) 

13 Turns which impress the 
field? (W) 

14 A red giant turns out to be a 
heavy sort of star (9) 

16 Play patience? (9) 

18 New novel in record cover (7) 

19 Saint ruled out this Oiled roll 

from Germany (7) 

21 provided with informa- 

tion about tea-time (5) 

23 Headless needles in jugs (6) 

24 Neat drawer for papers? (4) 

Solution 8,607 


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nagaania ocibiieeid 
u Q u b a a ta e 
□□HQ Q00I30aDQSJ3 

Boo a q □ a 
aaanaa oaatjoraa 
non 0 □ cj q 0 
OQBQDaCI 00DDIIE 

0 0 0 □ □ S 0 

EjasagaaonH oqeb 
0 a a a hi 
□□anancj qhhduibq 
Q15 Q □ 0 B 0 0 
QQQaaaHQ Dnomiam 




4 ' V. 







. ‘m.11 


1 


WORD 




FINANCIAL TIMES FRIDAY NOVEMBER 11 J 994 


27 


■ Welfare cuts are needed to 
release resources for growth 
Page i! 


FINANCIAL TIMES SURVEY 


HUNGARY 


Gyula Horn and the luck 
of the Hungarians 
Page HI 


Friday November 11 1994 


The hare becomes 
a tortoise 




The most westernised country in the region has 
squandered its head-start in the past few years. 
Nicholas Denton and Virginia Marsh report 


H tmgary, the pioneer of 
eastern Europe's eco- 
nomic reforms, remains 
in many ways the most 
advanced of the post-commu- 
nist democracies. But this cen- 
tral European state of 10m peo- 
ple with an impenetrable 
language appears to have 
Btumbled and squandered 
much of its head-start over the 
past couple of years. 

The national mood has 
slipped back into a customary 
malaise after a brief burst of 
optimism when voters ejected 
an unpopular conservative 
government in May and elected 
what appeared to be a more 
competent Socialist-led admin- 
istration. 

Mr Gyorgy Ivanyi, commis- 
sioner for bank privatisation at 
Hungary's AVRT state holding 
company, feels along with 
many commentators that Hun- 
gary has lost its “competitive 
edge." He says: “We are not 
Poland, forced to make radical 
moves. Nor a Czech Republic, 
which can quietly wait for an 
upturn in the world economy 
before doing anything serious. 
That is why we have neither 
the dynamism of the Polish 
economy nor the consolidation 
of the Czech one.” 

This loss of self-esteem mat- 
ters. Hungarian b usiness and 
government leaders, lacking 
confidence in themselves, find 
it difficult to woo international 
investors. “The Czechs have 
sold their country fantasti- 
cally, but the Hungarians have 
not done so in any meaningful 
way” admits Mr Janos Bartha, 
manag in g director of CS First 
Boston in Budapest 
Some observers are not sur- 
prised that Hungary should 
slip down the rankings. “It is 
logical that as others catch up, 
Hungary falls into its place,” 


says Mr Andras Simor, manag- 
ing director of Creditanstalt 
Securities in Budapest 

But the economic numbers 
are worse than that Output 
has dropped 20 per cent in four 
years; it has also fallen more 
or risen less than the east 
European average every year 
since 199L Recovery this year 
has run straight into balance 
of payments constraints. The 
economy may show GDP 
growth of up to 3 per cent this 
year but is forecast to sink 
back into a second dip of reces- 
sion in 1995 as government 
austerity measures bite. Infla- 
tion, at 19.5 per cent in August, 
and the public sector deficit 
expected to reach 7 per cent of 
GDP, are intractable. Hungar- 
ian debt is stuck stubbornly 
below investment grade while 
the rating agencies have twice 
upgraded the Czech Republic. 

Hidden by the gloomy 
national statistics, however, 
are a host of real achieve- 
ments. Though a deputy presi- 
dent of the National Bank of 
Hungary and former rrffiriat of 
the International Monetary 
Fund, Mr Gyorgy Szapary 
argues: “You cannot reduce a 
country to a fiscal deficit or a 
balance of payments number." 


T he national telecommu- 
nications company 
Matav is the first in the 
region to be privatised. Gas 
arid electricity sectors are next 
in imp- A stait has been made 
to bring in foreign investment 
and expertise into the coun- 
try’s troubled banking sector. 

Activity on the Budapest 
stock exchange has taken oft 
Richter Gedeon, a pharmaceu- 
ticals manufacturer, and plas- 
tics producer Pannonplast are 
among companies that have 
been floated. A record $400m of 


portfolio investment bas 
flowed into the country in the 
past 12 months. 

A new generation of entre- 
preneurs has sprung up. Busi- 
nessmen like Mr Imre Somody, 
the founder of pharmaceuticals 
producer Phannavit. have 
taken the place of the wheeler- 
dealers who made their for- 
tunes in the 1980s, only to lose 
them in the 1990s. 

State-of-the-art digital lines 
have spread apace. New “GSM” 
mobile telephone services are a 
success. Construction has 
begun on the region’s first pri- 
vately-financed toD motorway, 
which promises to bring 
Vienna within two hoars' easy 
driving of Budapest 

Complaints about banking 
services and office space, once 
staples of businessmen's con- 
versation, are now muted. 
Hungary's many Cassandras 
have forgotten the Inter-enter- 
prise debt that they once said 
would entangle the economy. 

Hungary has its precocity to 
thank for many of its advan- 
tages. The country opened up 
just in time, and lured foreign 
investors before the interna- 
tional recession hit and west- 
ern multinationals retrenched. 
The lax communist regime 
allowed a relatively free flow of 
people and information. “Hun- 
gary is the most westernised 
country in the region." says Mr 
Gyorgy Snranyi, managing 
director of Central European 
International Bank. Just look 
at the people, their outlook, 
their attitude.” 

But how has Hungary, with 
this rich inheritance, produced 
such a dismal set of economic 
statistics? One generous theory 
is that Hungary has gone fur- 
thest of the former Communist 
countries in making bank- 
ruptcy a real riisrip Hne on cor- 



Budapesf s Castle KB: the leader after one lap may not be the first to reach the summit 


Moor Motif 


0 

Mkl 

100 1 

0 

Km 

-JSi 


I 


POLAND 


CZECH REPUBLIC 



j SLOVENIA.."'' 

\ MaflykanteM ^ jm Raja 

„ m 

. Bare* V. Mofuica 


. . v * 
BOSNIA 
HERCEGOVINA 


porate behaviour. The govern- 
ment has also spent the most - 
$3bn so far - in shoring up 
state hanks made technically 
insolvent by defaulting clients. 

The measures should eventu- 
ally bring benefits. But the bill 
comes first lay-offs at bank- 
rupt enterprises; high borrow- 
ing rates charged by troubled 


banks; and government bail- 
outs which fuel the budget def- 
icit 

There are, however, less 
charitable explanations for 
Hungary's poor economic per- 
formance. “The fact that Hun- 
gary started reforms earlier is 
in some ways a disadvantage,” 
concedes Mr Szapary. 


The sense of being ahead bas 
sometimes induced compla- 
cency. “Politicians could afford 
the luxury of not reforming 
and that is what they have 
been doing," says Mr Laszlo 
Csaba of the Kopint-Datorg 
economic research institute. 

Moreover, Hungary’s eco- 
nomic development in the 
1980s was a mixed blessing. It 
was financed largely by foreign 
borrowing. Even the central 
bank admits that Hungary's 
debt ratios - debt service was 
45.5 per cent of current 
account revenues in 1993 - are 
“very near the critical point". 
The uniquely heavy burden 
bas stood out all the more as 
Poland, Yugoslavia, Russia and 
Bulgaria have defaulted and 
moved towards rescheduling. 

Mr Almos Kovacs, a deputy 
president of the National Bank 
of Hungary, issues the kind of 
advice a doctor might give to 
one of the many Hungarians 
with heart conditions: “Since 
we have this additional con- 
straint that these others don't 
have we must be careful how 
we generate economic growth.” 

Another legacy is obstinate 
inflation. Price controls were 


[| KEY FACTS 


Area 93,030 sq km Population _ 


Head of State 





Ri=pfi nr» 7 fi= 

=Fti4anR i 

Apr 1994 $1=ft1Q2.4 £1=Ft1 55.42 .... 

.Oct 1994 £1=0172.76 | 

ECONOMY 

1993 

1994 

Total GOP ($bn) 

38.1 

na 

Percentage change In \ 

GDP 

-2.3 

+1.0 

Private consumption 

1.4 

na 

Public consumption. 

30.5 

na 

Investment. — — 

-0.7 

na 

Exports. 

-11.0 

na 

Imports. 

18.6 

na 

Industrial output 

4.0 

na 

• Agricultural output 

-11.8 

na 

Consumer prices ! .......... 

21.1 

20.0 

Employment 

-6.6 

na 

Unemployment rate (%) * 

12.1 

11.0 

Discount rate (%) *. 

22.0 

22.0 

Treasury bffl rate (%) a 

16.8 

23.5 

Trade 4 

Current account balance (Sm)... 

-4,262 

-619 

Merchandise exports (Sm ) 

6,119 

1,751 

Merchandise imports [$m).. 

12,140 

2,311 

Trade balance ($m)._ ... 

-4,021 

-560 

EBRD estimates for 1993. ffiRD projections for 1994. 

(1) National accounts at constant prices. (2) End year. 

(3) December 1993, April 1994. 

(4) Trade figures from IMF. Ftst quarter only 1994. 

Sources: EBRD, Transition report Oct 1994. IMF. 


lifted earlier and more gradu- 
ally than in other east Euro- 
pean countries. That meant 
that Inflation peaked at 38 per 
cent, lower than, elsewhere. 
The downside is that expecta- 
tions of inflation are built in to 
the public consciousness. 
Phased adjustment in prices 
has also allowed wages to keep 
up more than they could in 
Poland and the Czech Repub- 
lic. Corporate profitability has 
suffered. 

Hungary's reforming com- 
munists ma y also have institu- 
tionalised a western-style wel- 
fare system too early - at a 
time when it seemed that the 
country could afford generous 
benefits and exorbitant tax 
rates. Mr Janos Kornai, an 
economist, coined a phrase: 
Hungary bas developed a “pre- 
mature welfare state". 

His Swedish colleague. Mr 
Anders Aslund, looks no fur- 
ther for an explanation of Hun- 
gary’s malaise. “There is little 
reason to expect economic 


dynamism from Hungary when 
only Sweden has a higher tax 
burden." 

But others insist that it is 
not yet time to write the coun- 
try off. One favoured metaphor 
for eastern Europe’s arduous 
economic transition is the 
10,000 metre race. One should 
not judge the outcome by the 
position after the first lap. 

Mr Laszlo Bekesl the new 
Socialist finance minister, Is 
after all making the most seri- 
ous effort in years to get to 
grips with welfare spending. 

And the sophistication of 
people, companies and institu- 
tions must eventually pay off 
in better economic perfor- 
mance. At least that is what 
Mr George Kopits, country rep- 
resentative for the IMF, 
believes. “They have fantastic 
h uman capital. In this country 
if they moved government out 
of everyday life, the economy 
could grow at 5 per cent plus 
for several years in a row. No 
problem,” 






State Holding Co. 

New Privatisation Strategy in Hungary 

Accelerating Privatisation 


Almost half of die privatisation in 
Hungary has been accomplished. Accord- 
ing to the latest estimations 47% of Stale 
property had been privatised. Opinions 
differ as to the value of this privatised 
property .According to the data of the State 
Property Agency 1800 enterprises belong- 
ed to the Agency in 1990 and the value of 
the companies owned by die Stale was 
estimated to 2000 billion HUF (appr. 
11,461 billion pound sterling). Some ex- 
perts believed even at that time that it is 
more, appr. 3000 billion HUP (appr. 
17,192 billion pound sterling). 


Obviously in this new situation, when 
this country has a new Government since 
last summer it is not worthwhile to analyse 
the events of die previous years. It is more 
important to see what are the plans of the 
new Government which was formed from 
the two opposition parties of the previous 
Parliament. 


that the strongest argument is for a one- 
man company form. In this case the sole 
owner would be the State and the Minister 
far Finance would exercise the ownership 
rights. 


Hence half of the State property was 
sold during the first four years of the Hun- 
garian privatisation obtaining a fairly good 
position in the Central Eastern European 
region which meant that the international 
capital especially ai the beginning of the 
political changes in the region became in- 
terested first of all in Hungary. This was 
due to several practical reasons. Among 
others because it was in Hungary where 
the legal framework of market economy 
has been established at the earliest, this 
country is politically fairly stable, in recent 
years there were less strikes in Hungary 
than in the whole Europe, Furthermore a 
relatively cheap and extremely well team- 
ed work force is available here. It is no 
accident that appr. 7,2 billion USD capital 
has flown into this country during the last 
four years in the framework of privati- 
sation and direct investment. 


The new Government declared several 
times its intention not only to follow but to 
accelerate the process of privatisation. Ac- 
cording to certain ideas the pan of state 
property intended for privatisation may be 
privatised within the next two or three 
years 


Irrespective of the form of the new. 
organisation it will be easier for the foreign 
investors because they will have only one 
partner to deal with, in this organisation 
not only the 160 companies of the State 
Holding Co. and the 600 companies of the 
Slate Property Agency would be under one 
management, but the property consisting 
mainly real estates hitherto belonging to 
the Treasury Holding Organisation. 


At the same time it is also obvious that 
only a part of the companies may attract 
investors who pay cash. There are appro- 
ximately 600-700 small or medium com- 
panies whdre they believe that although 
they would prefer cash buying, if there is 
no chance for iu then some form of prefe- 
rential buying system may be acceptable. 
By this the foreign investors will be in a 
better position than they were before when 
they had to pay cash for those companies 
which could be bought by domestic inves- 
tors for preferential bonds or credits. 


even during this transition period and to 
avoid any disturbance of the work due to 
the coming changes. A great deal of pre- 
paratory work is needed until the new law 
comes into force because significant orga- 
nisational "changes will come about. The 
process will be more transparent and ob- 
viously it will also be more pleasant for the 
investors when after the slate property to 
be privatised will be managed by one or- 
ganisation and (hey will have to deal with 
only one organisation. 


plants, suppliers and network systems is 
appr. 500 billion HUF (appr. 2,87 billion 
pound sterling). The privatisation concep- 
tion will presumably ready by the end of 
November. It is based on the privatisa- 
tion strategy worked out by the British 
Schroeder Co. It seems possible that the 
preparations of the tender may start in 
December. However the actual privatisa- 
tion will Lake place only in 1995. 


Similarly the final privatisation con- 


However it was the very first step of 
this Government to state that it intends to 
change the previous conception of privati- 
sation which was severely criticised espe- 
cially at home. The new strategy and draft 
law was prepared by a committee of eco- 
nomists and successful entrepreneurs and 
after a thorough professional and ministe- 
rial harmonisation it was presented to the 
Government at the end of October. It is 
intended to present this draft to the Parlia- 
ment already in November and though a 
lively debate is expected there the Parlia- 
ment may pass this law this year and the 
new privatisation strategy and law may 
come into force by January 1995. 


However the impetus of the start has 
somewhat slowed down. The cream of the 
companies has been sold fairly soon, 
although the most valuable companies are 
still partly or as a whole state property. But 
a special Act of Parliament regulates what 
percentage of prolonged stale property 
should be kept up in these companies. It is 
■ also certain that the interest towards the 
other countries of the region has increased 
too and there is a competition to attract 
foreign investors. Hungary’s position in 
this competition is still good. 

The conception- of the Hungarian pri- 
vatisation has changed several times du- 
ring the recent years. The start in 1989- 
1990 which is now called the period of 

spontaneous privatisation lacked the full 
legal framework. The Acts were passed by 
the Parliament only later, creating the 
State- Property Agency and the State 
Holding Co. to manage the companies in- 
tended to be kept in prolonged state 
ownership, or for partial privatisation. 


The new strategy aims at helping the 
Hungarian economy to the field of growth 
as soon as possible. There were long pro- 
fessional debates about whether the com- 
panies to be privatised should be first re- 
structured and improved and sell them af- 
terwards, or to sell them as they are now 
and the improvement should be the res- 
ponsibility of the new owner. The prevail- 
ing standpoint in the debate was that the 
State should not experiment to save with 
capital injections those companies it was 
unable to manage effectively by cemraJ 
direction, instead let the market and the 
new. owners do this job. 


The property involved is rather hete- 
rogeneous. Today those most valuable 
companies which according to a pre- 
vious law only partially wifi be kept in 
prolonged state ownership are still 
owned entirely by the State. These are 
companies of strategically important 
branches, first of all of the infrastructure, 
for instance the Magyar Elektromos 
Mffvek Rt- (Hungarian Electricity Co.j. 
the MOL Co. of the oil industry, the 
largest telecommunication company, the 
MATAV Co. and the gas companies. 
The international investors and the Hun- 
garian public opinion as well arc greatly 
interested in the fate of these companies 
because of their decisive significance in 
the economy of the country. Similarly 
the companies of the pharmaceutical in- 
dustry are considered to be among the 
most attractive Hungarian companies. 


U is anticipated that there will be com- 
panies where the method of privatisation 
will be the buy out of the company by the 
employees and management. In this case 
the preferential possibilities wit] remain. 
Moreover there is a new preferential pos- 
sibility on the agenda, namely that if the 
employees and management buy 10% of 
the shares of the company, the further 
40% may be paid in ten years and after 
that they receive the remaining 50% gra- 
tis. However this solution will be accept- 
able only if the company could not be sold 
hy ary other way. because they do not 
wish to give up the intention that privati- 
sation should serve first of all the growth 
of the economy and the modernisation 
which can obviously be achieved only by 
involving fresh capital and by technical 
development. 


-This will be the case only next year, 
and at present a significant part of (he 
companies attracting the foreigners mast 
belong lo the Slate Holding Co. Many 
people objected that lately the decision 
making processes slowed down somewhat 
while declarations about the intention to 
accelerate are frequently heard. How is it 
possible to cope with this contradiction? 


ce prion of the gas companies will be pre- 
lfo ' 


pared in the second half of November. We 
are well aware of the fact tiiar the unambi- 
guous tariff system is the precondition of 
privatisation. The Ministry of Industry 
makes serious efforts in this regard and 
hopefully this problem will also be solved 
by next January. 


Although a number of conceptions 
have been elaborated as to their privatisa- 
tion, or property management, these had 
not yet been finalised. However the netrdlo 
accelerate the privatisation urged die le- 
aders of privatisation to get the experts to 
elaborate already this year - probably by 
the end of November - the final strategy. 


At the beginning of October the 
Prime Minister appointed a new Direc- 
tor Genera] of the State Holding Co. He 
is the 35 years old Attila Lascsik who is 
considered unusually young for this of- 
fice In Hungary. He considers himself a 
technocrat, educated In finance, and 
gained experience until now in the busi- 
ness world and In the administration as 
well. Before his appointment he was one 
of the directors of the State Holding Ca 


The intention to decrease the role of 
the State is shown by the fact that it is 
intended to decrease the property of pro- 
longed state ownership. Therefore the 
State Property Agency and the Stale 
Holding Co. wiU be merged. Hie debate is 
still going on about the character of this 
new organisation and the final decision 
will be made by the Parliament. The topic 
of the debate is the form of the new orga- 
nisation, whether it should be a joint stock 
company or a stale organisation. It seems 


The new Government makes no secret 
about it that in the future the cash buying 
will be preferred. This is needed by the 
budget and the raising of the capital is 
indispensable for the development of the 
companies too. 


The new strategy intends in give a 
greater role to the involvement of the fo- 
reign capital by establishing investment 
funds. Greater significance may he allot- 
ted to the Stock Exchange. It is intended 
to introduce 10- 1 2 companies to the Stock 
Exchange in the near future, 


-Your appointment and the changes in 
the Board of Directors of the State Holding 
Co. was explained with the reason that the 
new Government wishes to see experts an 
these posts who serve the new privatisa- 
tion strategy better, ft is known that the 
State Holding Co. wilt soon discontinue 
because after passing the new Ad the pri- 
vatisation organisations will merge. Ynur 
assignment will last only up to the end of 
this year What i tow he i A me during sm 'h a 
short time ? 


-The companies may be divided into 
two large groups. The first group is more 
numerous, but their value is less, that is 
that a company belonging to this group has 
less than 1 billion HUF (5,73 million 
pound sterling) capital. These companies 
will obviously be more attractive to the 
domestic investors. Companies attractive 
to the foreign capital are mainly infrastruc- 
tural systems, that is the electric power 
industry, gas supply, or telecommunica- 
tion. In the case of these companies we will 
elaborate much more efficient privatisati- 
on tenders. We are preparing information 
memorandum, auditing corresponding to 
the international practice. The elaboration 
of privati sation conceptions are also in 
progress. We attach great importance to 
elaborate such conceptions which corres- 
pond to the international customs, but at 
the same time has also the interest of the 
country in sight, because these branches 
are decisive with respect to the future of 
the country. 


The privatisation of the most impor- 
tant company of telecommunication, the 
MATAV Co. has already begun, 33% of it 
was already sold by the State Holding Co. 
last year. Now we examine the possibility 
to introduce it to the Stock Exchange. 


We pay great attention to the banks. 
There is a great interest on the part of the 
foreign investors too. The nearest possibi- 
lity is the privatisation of the Budapest 
Bank Co., involving professional investor 
and fresh capital, but the conclusion of the 
contract is feasible only in 1995. By the 
way the quoted capital of the Budapest 
Bank is 12,64 billion HUF (appr. 72,45 
million pound sterling). We are preparing 
lo introduce to the Stock Exchange the 
largest residential bank, the OTP Co. (its 
quoted capital is 23 billion HUF - appr. 
131,81 million pound sterling). 


-There were already conceptions be- 
fttre but less tenders. What will change? 


It is very important lo preserve the 
continuity of ihe privatisation process 


These great infrastructural systems are 
today state monopolies and it is not our 
intention lo change them into private mo- 
nopolies. Therefore in the electric power 
industry we pfan that the power plants and 
Ihe network supply companies should be 
attached to the MVM Rt. (Hungarian 
Electric Co.) not by ownership but by trade 
connections. As a matter of fact this com- 
pany today is the most valuable company 
of the country, the value of its power 


With regard to the industry the most 
successful and at the same time the most 
attractive field for foreign "investors is the 
pharmaceutical industry. Its privatisation 
has already begun partly involving foreign- 
capital and partly by introduction to the 
Stock Exchange. But naturally we count 
on the appearance of additional foreign 

investors too. 


Further information please contact: 


Slate Property Agency 
Press and Marketing Department 
Tel/Fax: 36-1-267-0069 


State Holding Co. 

Press and Marketing Department 
TeJ.: 36-1-267-6691 
Fax: 36-1-209-3718 


t 











FINANCIAL TIMES FRIDAY NOVEMBER 11 19»4 


HUNGARY II 


Virginia Marsh assesses the political scene 

Old order in a new guise 


Parliamentary elections 


1st round votes l%i 


1990 l 


Rna3 seats (%} 


FOREIGN POLICY 




24.73% Denwatw Forum 42.7% 


Like voters in other former 
east bloc countries, Hungar- 
ians returned former Commu- 
nists to power in this sum- 
mer's general elections, the 
second since the collapse of 
communism. Unlike many of 
their neighbours, however. 
Hungarians again elected a 
potentially strong and stable 
government 

With 72 per cent of seats in 
parliament, the Socialist-Lib- 
eral coalition has a large 
enough majority to pass any 
legislation, including amend- 
ments to the constitution. The 
Socialists' control of 54 per 
cent of parliament means the 
party is likely to serve a full 
four-year term. 

The government, a coalition 
between the Hungarian Social- 
ist party, the heir to the Com- 
munist party, and the liberal 
Alliance of Free Democrats, 
the election runners-up, has 
pledged to use its mandate to 
complete Hungary's transition 
to a market economy. Its key 
objectives are to finish the pro- 
cess of privatisation, stabilise 
the country's heavily indebted 
economy and lay the basis for 
strong growth and integration 
into the European Union. 

Such ambitious aims, and 
the radical reforms which are 
required to achieve them, rep- 
resent a big challenge for the 
HSP, a left-whig party elected, 
in part, to soften the pain of a 
transition which lias already 
cost 1.4m jobs and caused liv- 


ing standards to plunge for 
many Hungarians. 

HSP leaders, however, recog- 
nise that the country's poor 
economic situation means 
there is little room for manoeu- 
vre. Mr Gyula Horn, the prime 
minister, says: “The basic fact 
is you cannot spend more 
money than you earn which is 
what our governments have 
been doing for decades. ..It Is 
our bad luck that we are the 
ones who will have to stop that 
practice . . . Fundamental 
chang es have to be made." 

The challenge Is to find a 
balance between the tough 
reforms needed to cure the 
economy and his party's desire 
to create “a social market 
economy" which offers protec- 
tion to the poorest members of 
society, Mr Horn says. 

Analysts say finding this bal- 
ance and formulating coherent, 
consistent policies will be diffi- 
cult for a coalition grouping 
socialists with free market lib- 
erals and for an HSP whose 
members span the political 
spectrum. 

The government's three 
months in office have already 
seen confrontations between 
different factions in the party. 
Mr Laszlo Bekesi, the finance 
mini ster, who is considered 
more of a liberal than a social- 
ist was forced to water down 
bis austere mid-year budget 
and accept a retroactive S per 
cent increase in pensions after 
objections from trade unions 


backed by cabinet members. 

The soft economic policy line 
can be partly explained by the 
government’s unwillingness to 
take unpopular measures 
-ihnari of nest month's nation- 
wide local elections which will 
be its first major test since 
May’s general elections. 

Opinion polls indicate little 
chance of a defeat for the 
Socialists. However, the Social- 
ists and the Free Democrats 
will face a combined challenge 
from the main opposition par- 
ties. The Hungarian Demo- 
cratic Forum, whose conserva- 
tive-nationalist government 
suffered a crushing defeat in 
the general elections, its ally 
the Christian Democrats and 
the liberal Young Democrats 
fFidesz) have, for the first 
time, agreed to field common 
candidates in some districts. 

Mr Viktor Or ban, president 


of Fidesz. says it is essential 
the opposition works together 
to defeat the government par- 
ties in 1998. "The real chal- 
lenge is to prevent fragmenta- 
tion of the opposition. By 1998 
the government will be 
unpopular and people will 
want to get rid of it. They 
won't be able to if there is no 
credible alternative. We have 
to build up this alternative." 
he says. 

Analysts say co-operation in 
the local elections could be the 
start of a realignment in the 
centre and centre-right parties 
to counter-balance the social- 
ist-liberal alliance. This could 
lead Hungary towards a bipo- 
lar political structure rather 
than the present bipolar struc- 
ture of socialists, liberals and 
conservatives. Mr Istvan 
Stumpf, director of the Buda- 
pest School of Politics, says: 


. vMK 

*«V t* 4 . KW 

• H-73% SmaPidgOT Party 11.4% - 

1UB9% Socialist Party &B% 

15-85% others 


21.39% Free Democrat 23 JBK, 


&95% Young Democrats &<% 
6.46% Christen Da m o aa B 5L4% 
2.7% 




3806% 


I 1994 ? 
SoaaBst Party 


54.1% 


19.76% Free Democrats iai% 
11.73% De mo a alic Forum 9u5% 

8J8S% SmaHhoMera' Pany &7% 

7 JOB% Christian Democ rats 5.7% 
7-00% Young Democrats 5.1% | 


1665% 


Othere 


2.7% ^ 



“The elections are important 
for the future. The three oppo- 
sition parties will see if they 
can gain more support stand- 


ing together. If they get only 10 
per cent of the vote, then 
moves to form a new centre- 
right coalition will collapse." 


In politics, time proves a great healer 


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Politics can make for few bedfellows 
stranger than the Socialists and Free 
Democrats, partners in the new centre-left 
coalition government. One would not 
guess from their present intimacy that 
they were formerly implacable opponents. 
The Socialists were once the communist 
satraps of the Soviet Union and their most 
vocal critics were precisely the dissident 
intellectuals who went on to fonnd the 
Free Democrats, writes Nicholas Denton. 

This being Hungary, the truth is more 
subtle. The founders of the Free Demo- 
crats often came from communist family 
backgrounds and passed through Maoism 
to their final, liberal political destination. 

Meanwhile, Hungary's Communist 
rulers, chastened by the 1956 uprising, 
treated dissidents quite gently. “With few 
exceptions, these oppressed people were 
not physically hurt," says Mr Viktor 
Polgar, head of the Socialists' Budapest 
campaig n. “They had BMWs while I was 


driving around m a Toyota." 

Bnt Free Democrats still remember 
how. even in the late 1980s, police 
directed by the Communists beat up 
demonstrators on sensitive anniversaries. 
Wiretap reports of the Free Democrats' 
kitcben-table conversations were sent to 
ministers in the Communist government. 

The dissidents have no monopoly on 
hard feelings. Some reform Communists 
feel that they did the tough work of the 
transition while the apposition basked in 
the admiration of the west. “The 
Socialists are people who fought for 
change, in a different way: they had to 
work within the system," says Mr Polgar. 
“I would have loved to have been in 
opposition.” 

Time has proved a great healer. Mr Ivan 
Vitanyi. a Socialist ideologist now argues 
for an eventual merger of the coalition 
parties. One forgiving intellectual close to 
the Free Democrats has pushed for a lib- 


eral gesture to rehabilitate the former 
communist regime and give it credit for 
its relatively benign character. 

Political i m perat i ves have dictated the 
rapprochement The Socialists, despite 
their 54 per cent parliamentary majority, 
are still former communists. They are dis- 
trusted and even hated. The Free Demo- 
crats bolster their legitimacy. 

As for the liberals, Hungarian politics 
appears increasingly bipolar. Apart from 
an alliance with former communists the 
Free Democrats had unappealing options: 
going in with conservatives they detest or 
inhabiting and eventually dying in a no- 
man' s-land between the political blocs. 

Mr Mlkl os Haraszti was one of Hunga- 
ry's most hounded dissidents. He backs 
the coalition, bat it is not easy. “I support 
it and I hate it We know we have to do it 
bnt we don't have to be happy about it It 
is the least awful alternative,” he says. 
"Bnt that is democracy, isn’t it?” 


Main goal is to 
join the EU 


The overriding foreign policy 
objective of Hungary's new 
Socialist-led government dif- 
fers little from its conservative 
predecessor: to inte grate the 
country into western European 
structures through member- 
ship of the European Union 
and Nato by the end of the 
century. 

Mr Gyula Horn, the prune 
minister, says EU membership 
is the Tnain goal of bis govern- 
ment “This is a duty, a tas ^ 01 
the utmost importance for 
us . . . Becoming a member 
we will have been able 
to establish a social market 
economy and to comply with 
European Union standards and 
regulations. The other crucial 
factor is the security we think 
we c fln find in the EU." 

The government is building 
on the work of its predecessor 
which, together with Poland 
and Czechoslovakia, signed an 
association agreement with the 
EU in December 1991 and for- 
mally applied for membership 

earlier this year. 

Hungary, in common with 
other eastern European states, 
believes it is now up to the EU 
to reveal its timetable and con- 
ditions for membership. Mr Ist- 
van Szent-Ivanyi, state-secre- 
tary at the foreign ministry, 
says: “The European Union 
does not have a dear policy 
towards central Europe. We 
hope this can be resolved at 
the Essen summit in Decem- 
ber. Now, we hear different 
points of view, from party to 
party and country to country. 
This makes preparatory work 
very difficult for us." 

The government acknowl- 
edges that Hungary and other 
countries in the region must 
reform their economies before 


joining the EU. ButMrSzant^ 
Ivasyi says the EU should ’ 
apply the same political ratio, 
nale to eastern - European 
enlargement as It f tyi to mem? 
bers who joined in the ioeas 
and set its economic camfitians 
accordingly. • 

He says: The economic 
requirements for car member- 
ship should to formulated bo 
that the most advanced c entra l . 
European countries have's 
chance - to comply with 
them . .. Portugal, Greece and 
Spain were admitted; due. to a 
strong political will to -give a 
band to the new-born democrar 
ties in those countries and to' 
help consolidate them. This, 
was a courageous - and clever 
step." 

Where the hew government 
differs from its conservatives 


Events in Romania and 
Slovakia have reduced 
prospects of agreibriient 


E conomists believe Hun- 
gary faces a stark choice: 
the country must cut 
public expenditure, lower taxes 
and restructure its bloated wel- 
fare system, which last year 
cost the equivalent of 29 per 
cent of gross domestic product, 
or sacrifice strong economic 
growth and the chance to com- 
pete in the single European 
market, writes Virginia Marsh. 

Mr Andrew Rogerson, resi- 
dent representative of the 
World Bank in Budapest, says: 
“Radical changes in spending 
are needed if Hungary is to 
dose the gap with western 
Europe. To catch up will 
require faster growth than is 
now on the table. The govern- 
ment has to find a way to pro- 
vide both a social safety net 
and the basis for sustainable 
growth. It must release more 
resources for growth and 
investment” 

However, it will not be easy 
for a Socialist-led government, 
elected in part to soften the 
pain of transition, to overhaul 
the extensive welfare system 
which most Hungarians have 
come to expect from the state 
and which provides cash bene- 
fits to most households. 

Mr Peter Akos Bod, the oen- 


‘Resources must be released for growth’ 

Welfare cuts needed 


tral bank governor, says that 
unlike the productive sectors 
of the economy, the social sec- 
tor has undergone little 
restructuring in the past four 
years. 

“Large areas - welfare, 
health, culture, education, 
social services - function as 
they did 10 years ago... The 
previous government was 
unwilling to tackle these prob- 
lems because the economy was 
contracting and society was in 
trauma due to the changes 
after 1990. Now. we should cor- 
rect this," he says. 

Within the government there 
appears to be a broad consen- 
sus on the need to restructure 
the system which Mr Laszlo 
Bekesi, finance minister, 
describes as “premature" for a 
country with Hungary’s 
resources. However, he admits 
Imp l e m e ntation of tough mea- 
sures will be difficult for many 
ministries. This view is shared 
by western advisers who say 


there are already sharp divi- 
sions within the government 
as to how deep cuts in welfare 
should be. 

Mr Bekesi says social sector 
reform will form a large part of 
the government’s three-year 
modernisation plan due to be 
presented in the spring. In the 
meantime, the cabinet has 
accepted a draft 1995 budget 
which raises social expenditure 
by just 10 per cent in nominal 
terms. Given expected annual 
inflation of more than 18 per 
cent, this will lead to signifi- 
cant cuts in real terms, if 
implemented. 

The draft budget also begins 
the first of several expected tax 
reforms in the sector. From 
1995, contributions to the 
social security and unemploy- 
ment funds will be only 25 per 
cent deductible for personal 
income tax purposes, down 
from the present 100 per cent 

Welfare ministry officials say 
the efficiency of the system 


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also needs to be improved. A 
key problem is that too many 
benefits are paid to too many 
people while as increasing 
number of Hungarians slip 
below the poverty line. 

“Support should be better 
targeted at those who need it 
than at present,” says Mr Mih- 
aiy Kokeny. secretary of state. 
For example, from 1996, the 
state plans to combine child 
and child care benefit and pay 
families a flat rate. Under the 
present scheme the benefit 
varies according to a family's 
income, paying a higher 
amount to higher earners. 
“This way we will create 
savings for the system and 
redirect resources to lower 
income groups." 

He says welfare providers 
can also be made more effi- 
cient by increasing competi- 
tion among them and by allow- 
ing local authorities to 
contract out some services to 
the private sector. Competitive 
tendering has already been 
introduced in some World 
Bank-funded projects. 

Other medium-term plans 
include pension reform. One 
way to reduce the burden on 
the state would be to encour- 
age private schemes and later 
retirement in line with Euro- 
pean norms. The present offi- 
cial retirement age is just 55 
for women and 60 for men. 

Mr Kokeny says: “We would 
like to restructure pensions so 
that people would be able to 



Laszlo Bekasfc system ‘‘premat u ra" 
for the country's resources 

retire early but there would be 
incentives to stay at work lon- 
ger." He says an element of 
choice is essential if the popu- 
lation is to accept cuts and 
changes in welfare: “We can- 
not be rigid. We have to dis- 
cuss our plans openly and 
warn people of them wen in 
advance. If we take a top-down 
approach, we could easily fail.” 

Western advisers point to the 
considerable political risks 
involved lor the Socialist gov- 
ernment. One says “In making 
the cuts, the government is in 
danger of losing the support of 
a large part of the middle class 
- those who are not poor but 
not rich, either. The problem is 
many people are happy with 
the status quo. The changes 
will benefit just a few.” 


nationalist predecessor is in Its 
policy towards neighbouring 
countries, in particular 
Romania and Slovakia, in his 
first speech to p arliam e n t .as. 
prime minister, Mr Horn said . 
Hungary’s most urgent foreign 
policy task was to eliminate 
tensions with, its neighbours 
and negotiate basin fHenrisErip 
treaties with the two conntties. 
Improving relations was the 
best way to promote the. inter- 
ests of the ?. 3m ptfmfo T ftmfff ir- 
ians living in Romania and Slo- 
vakia, he said. 

In a departure from previous 
policy, Mr Horn said his gov- 
ernment would guarantee the 
invioLability o f borders in the 
basic treaties - a guarantee 
upon which both Romania and 
Slovakia have conditioned 
bilateral agreements. - 
Despite Hungary's overtures, 
the chances of a rapid agree- 
ment have been lessened by 
political events in Romania 
and Slovakia since the new 
government took office. In 
August, a nationalist anti-Hun- 
garian party formally joined 
Romania's ruling coalition to- 
the first time. In September, 
nationalists led by Mr Vladimir 
Meriar won Slovakia's general 
elections and are expected to 
form the next government 
Foreign ministry officials 
concede these events mean it Is 
less likely that Bucharest and 
Bratislava will agree to Hunga- 
ry's demands for improved 
treatment of ethnic minorities. 
But faced with, stalemate at the 
political level, Hungary aims to 
improve economic and trade 
links with the two countries. 
Officials say the effect may 
spill over in other fields such 
as minority and human rights. 

In the meantime, Hungary 
will continue to press the 
Council of Europe and the 
European Union to provide 
greater legal guarantees to pro- 
tect minority and human 
rights. Mr Szent-Ivanyi says: 
“This Is not just a Hungarian 
problem. We believe it is a 
hard-core issue for all central 
Europe, from the farmer Yugo- 
slavia to the Baltic states.” 

Countries in the region need 
western European support to 
help build confidence and over- 
come the “tremendous suspi- 
cion" which exists between 
many of them, he says. One 
way to achieve this might be to 
link applicant states’ minority 
and human rights record to EU 
membership. 

Virginia Marsh 





FINANCIAL TIMES FRIDAY NOVEMBER 11 1994 


29 





».*■? % 


HUNGARY III 


Virginia Marsh looks at the privatisation programme 

A four-year revolution 


Hungary’s Socialist-led 
government has set itself the 
ambitious target of completing 
its privatisation programme by 
me mid of its four-year term. 
To show it is in earnest, it has 
appointed a political heavy- 
weight, Mr Ferenc Bart ha, a 
former central bank governor 
and more recently head of 
Banque Indosuez Hungary, to 
the new job of government pri- 
vatisation commissioner. 

“We don’t expect to privatise 
100 per cent of the economy by 
1898." concedes Mr Peter Mih- 
alyi, Mr Bart ha's deputy. "But 
we would like the economy to 
be largely in private hands. We 
have to reduce the state’s 
involvement so that privatisa- 
tion is no longer a top priority 
political issue." 

To achieve this goal, a group 
of 30 economists from the state 
and private sectors spent sev- 
eral weeks this autumn draw- 
ing up a new privatisation 
strategy and draft bilL Mr Bar- 
tha is hopeful the bill will be 
passed by parliament before 
the year ends. “The political 
will exists," he says. 

He says the state will reduce 
the number of companies in 
which it will retain a majority 
stake and privatise nnmpaniasf 
Immediately rather than 
restructure them first Cash 
would be generated from sales 
of the big blue chip companies 
such as utilities, while compa- 
nies would be teamed up with 
strategic investors. Finding 
good partners and providing 
for companies' long-term sur- 
vival will take priority over 
revenue generation for medi- 
um-sized firms. 

The state intends to sell 
small companies as quickly as 
possible, preferably for cash, or 
telling that by offering incen- 
tives to management and/or 
employee groups or other 
investors. 

Mr Bartha wants to make 
greater use of the country's 
nascent capital markets. One 
idea is to launch a country 
fund grouping shares from 10 
to 12 partially privatised com- 
panies such as Matav, the tele- 
communications monopoly, 30 
per cent of which was sold to a 
Deutsche Telekom and Ameri- 
tech consortium in December. 

Most foreign advisers believe 
good companies would gener- 
ate more revenue if sold indi- 
vidually, but Mr Bartha says a 
country fund would attract 
Interest from the many new 
emerging market investment 
funds. 


Real GDP 

Chongs over previous year 

5% 


MiatKort 

Change over previous year 
60% — 



1801 

SoucwQBRD 


1992 199a.^894./ 

tsrtmdt*' PrcfceUon 


1891 . 1892 

.Sou rcSHD 


1993 1994 

Eatkmto Protection 


The appointment of Mr Bar- 
tha and the new strategy have 
been generally well-received by 
foreign investors. However, 
most are reserving Judgment 
until they see action. “There's 
an element of strategy fatigue. 
We've heard much of this 
before," says one western 
investment banker. 

Investors add that, in the 
short term, some of the govern- 
ment's proposals, such as the 
merger of the two main privati- 
sation bodies - AV Rt, the 
state holding company, and the 
AVU. the state property 
agency - will inevitably slow 
down, not accelerate, the pro- 
cess. 

Investors have also heen 
unsettled by sweeping per- 
sonnel changes at AV Rt, inc- 
luding the dismissal of Mr 
Lajos Csepi. its respected 
general director, and the 
sacking of several top mana- 
gers at large state companies 
due for privatisation suite as 
MVM. the electricity mono- 
poly. “However competent the 
new managers, such radical 
changes will inevitably slow 
privatisation of these 


Currant account 



Trade balance 

* billion' 



companies," one banker says. 

Observers fear the sackings 
and a much-publicised inquiry 
into alleged corruption in pri- 
vatisation under the previous 
government mean the process 
will remain highly politicised. 

A western diplomat says: 
"The government is spending a 


lot of energy investigating the 
past and attacking its prede- 
cessor's record. Instead, it 
should be concentrating on the 
future." 

Despite their criticisms, most 
investors are hopeful the gov- 
ernment will move ahead with 
the privatisation of Its gas dis- 
tribution and electricity 
monopolies, both of which are 
attracting significant foreign 
interest. 

Gas will come first with the 
government expected to 
announce a tender date this 
autumn for the sale of 25 per 
cent stakes in the five regional 
domestic gas distributors. Mr 
Laszlo Pal, Socialist industry 
and trade mini ster, says the 
government will follow this up 
in the first quarter of 19S5 with 
the first tender for the privati- 
sation of MVM, the electricity 
monopoly. The aim is to close 
a deal by the end of the year. 
The government, which is 
being advised on the sale by 
Schroders, the UK merchant 
bank, is expected to offer 
stakes first in MVM's power 
distribution subsidiaries. 

Before this can happen, how- 
ever, the government must 
complete the regulatory frame- 
work for the industry. This 
includes tightening the con- 
tractual relationship between 
different MVM subsidiaries and 
resolving the socially sensitive 
issue of price regulation. 

Mr Pal says prices, which are 
controlled by the state, will 
become "market-based". But to 
achieve this, the government 
has to ensure that increases 
are acceptable to the public 
and do not “gallop away”. Ana- 
lysts estimate that electricity 
prices must rise by at least 70 
per cent to make the company 
attractive to outside investors. 


Nicholas Denton on the top investment bank 

Colossus from Boston 


CS First Boston, still 
recovering from wrenching 
internal reorganisation, may 
stand In the shadow of Gold- 
man Sachs and Morgan Stan- 
ley in New York and London. 
But in Budapest and other east 
European financial centres, 
CSFB is a colossus. 

No other international 
investment bank has been so 
active. Even rivals concede 


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that CSFB is the pre-eminent 
investment bank in Budapest 

Yet Mr Janos Bartha, manag- 
ing director of CSFB Budapest, 
says: “It’s not a one-man show, 
far from that." Creditanstalt 
Securities, a subsidiary of the 
Austrian bank, competes on 
smaller deals. CSFB backed the 
wrong horse in the bidding for 
Matav, the telecoms company, 
so Goldman Sachs won the suc- 
cess fee in Hungary’s biggest 
single privatisation. 

Merrill Lynch, which han- 
dled tobacco industry privati- 
sation, and NM Rothschild, 
which has advised on telecoms 
and gas privatisation, also won 

lucrative man- 

dates without 
setting up 
costly local 
offices. 

So although 
investment 
banking in 
Budapest may 
not be a one-man show, one 
player - CSFB - has got most 
of the parts. CSFB helped the 
Hungarian authorities privat- 
ise national airline Malev, 
refrigerator maker Lehel, the 
commercial banks and now 
Hungarhotels, the hotel chain. 

Until 1992 the firm estimated 
that it had advised on a third 
to a half of M&A activity. Now 
CSFB does not bother count- 
ing. “Here we just don’t have 
the top-notch investment bank 
competitors with us in domes- 


Investment banking 
in Budapest may 
not be a one-man show, 
but CSFB has got 
most of the parts 


We acted as financial advisor in the rights offering and placement agent in the private 
placement of these securities. This announcement appears as a matter of record only. 



$43 

June 


,785,518 

1994 


The First Hungary 
Fund Limited 


The First Hungary Fund Urnited ^as ^'andmarl faction 

Wtl wn tw oveMrtO million and when combined with the 
grown by over S40 m total fund size amounts to 

5?8 WhTedie rest of the world debates investmg in 
feSSpe. Steams is helping others capital,®. 


Bear, Steams & Co. Inc. 


October 1994 by 

uwd BNf. Hfim- “ ^ ^ — 


InhfTUikHv! Untiled .* member is IV ScamlK^ AwKwimn 


tic markets," says Mr Bartha. 

Aside from advisory work. 
CSFB has introduced corporate 
bonds and commercial paper 
issues to the Budapest market, 
helping borrowers bypass the 
large margins charged by Hun- 
gary’s commercial banks. The 
fees have been modest but the 
service has given CSFB access 
to such companies as McDon- 
ald's Corporation with which it 
never had a relationship. 

M&A work and fixed income 
issues have helped meet run- 
ning costs. But the real 
rewards have come on the 
equity transactions that have 
proliferated in the last 12 

months. CSFB 

has acted as 
the prime con- 
duit for the 
flow of western 
institutional 
money into 
eastern Europe. 

In Hungary's 
case, CSFB has managed the 
international equity issues of 
Egis, Pannonplast and Fotex, 
and sold over S200m worth of 
shares. CSFB, alone of the 
international investment 
banks, possesses a broker s 
licence in Budapest. The firm 
has bought up shares on the 
secondary market, helped west- 
ern fluids secure shareholdings 
in companies such as telecom- 
munications utility Matav - 
and profited handsomely. 

Not all the deals have been 
well-judged, say rivals. "I have 
a lot of investors complaining 
about CSFB, both in terras of 
the assets they have been sold 
and the fees they have been 
charged,” says one Budapest 
Investment banker. Fotex 
shares have slumped below 
their issue price despite 
CSFB's stamp of approval. "If I 
had bought Fotex I would be 
screaming," the critic says. 

While New York and London 
may have suffered from the 
downturn in world bond mar- 
kets, Budapest is set for a 
record year. It is believed that 
CSFB's Budapest office passed 
its targets for the year several 
months ago. 

“Eastern Europe is going to 
be paying the salaries of 
iuvestment bankers in New 
York this year,” says a CSFB 
executive. Those who had dis- 
tanced themselves from 
CSFB's east European adven- 
ture now fight for their share 
of the credit for revenues from 
Budapest. Prague and Moscow. 

J.P. Morgan and Salomon 
Brothers are looking to set up 
Budapest offices. Mr Hans-Jorg 
Rudloff, CSFB's former Euro- 
pean head, who is now inde- 
pendent, may build up his own 
investment banking business. 
Mr Bartha accepts that CSFB 
will give up market share, if 
not market leadership. 

Nevertheless, in its 15 profes- 
sionals in the Budapest office, 
CSFB has a lock on much of 
Hungary’s investment banking 
expertise. Salomon Brothers 
has been looking for months 
for someone to head its opera- 
tion - without success. "The 
barriers to entry are high," 
says Mr Peter Kadas of CSFB. 


T here can be few better 
measures of the change 
in eastern Europe than 
the evolving image of Gyula 
Horn. As foreign minister in 
the last Communist govern- 
ment five years ago, he was 
one of the liberators of the 
Communist bloc: the mad who 
with a gesture of biblical 
proportions opened the Iron 
curtain and let the east 
Germans go free. 

Now, after four years in 
opposition, Mr Horn is back in 
government, this time as 
Hungary's Socialist prime 
minister. “There should be no 
reservations about the 
government or me per- 
sonally," says Mr Horn. “We 
started the transition to 
democracy in the second half 
of the 2960s of our own free 
will, without any pressure. We 
began creating a multi-party 
system and the market econ- 
omy. Now we want to carry 
this through to the very end." 

But eastern Europe has 
moved on even faster than Mr 
Horn. A progressive in the 
1980s, the 62-year-old Mr Horn 
still reminds many of the past. 
“He doesn't fit into the new 
European political landscape," 
says Mr Janos Martonyi, 
former state secretary at the 
foreign ministry. 

Anti-common is is damn the 
prime minister for his 
participation in the “padded 
jacket" worker's militia that 
put down Hungary's 1956 
uprising against Soviet role. 
Even the 1994 version of Mr 
Horn provokes a shudder or 
two, at least among Hungary's 
influential intelligentsia. It 
may be unfair to judge by 
demeanour. But according to 
one prominent banker: 
“Wherever Horn appears, 
everyone thinks of a former 
communist. No matter what he 
says." 

Hunched in bis chair, 
chain-smoking, rarely meeting 
the eye, a short man in a 
prime ministerial office the 
size of a basketball court, Mr 
Horn fits the stereotype of the 
Communist apparatchik. 

When Mr Horn departs from 
his script he has a good line 
in deadpan humour illustrated 
by a wry grin. Bnt he can as 
easily lose his patience with 
questioning and abruptly 
terminate an interview. 

Content is as much at issue 
as style. Mr Horn, born of a 
working-class Communist 
family, is still proud to call 
himself a leftwinger. But 
nowadays, be looks not to 
Marx as the fount of his 
socialism but to Pope John 



Gyula Horn: a rapport with crowds 


Prime minister interviewed 

Horn and the 
luck of the 
Hungarians 


Paul II. "The head of the 
Catholic church and the 
Vatican say capital is blind 
and deaf to social differences - 
that is why policymakers have 
to interfere.” 

The Socialist leader's 
left-leaning beliefs reflect the 
opinions of his constituency. 
Hungary had a communist 
government for four decades 


among east European pol- 
iticians. “These are my 
waters," he says. “I can really 
feel good among people." This 
popular touch makes Mr Horn 
in a sense a better democrat 
than his conservative 
predecessors who supported 
the idea that the people should 
rule in theory but were always 
disappointed in the character 


Though Gyula Horn is a talented operator, 
to many he now seems out-of-date, write 
Nicholas Denton and Virginia Marsh 


and egalitarian ideals remain 
strong. Many voters opted for 
the Socialists because they 
promised security and support 
for the losers in the transition. 

These, not Budapest's 
chattering intellectuals nor 
judgemental westerners, are 
the people Mr Horn cares 
about. “My model is Janos 
Kovacs, the ordinary simple 
person on the street who can 
tolerate the zigzags that 
politicians make and tell what 
Is genuine and what false." 

Aides say he really means 
that. Uncomfortable in 
parliament and before western 
investors, Mr Horn never- 
theless shows a real rapport 
with crowds that is rare 


of the Hungarian masses. 

Mr Horn is a talented 
operator behind closed doors 
as well as on the public stage. 
He doggedly held his party 
together when it seemed 
doomed to extinction. Now he 
plays the arbiter between 
technocrats, trade unionists 
and the myriad groups within 
the broad and heterogeneous 
governing party. 

As foreign minister, Mr 
Horn visited the US. A former 
aide tells how a US state 
department official offered an 
insulting 15-minnte audience. 
Mr Horn accepted, said his 
piece, smiled, got up and 
politely left the open-mouthed 
US official after ID minutes. 


The genius of Mr Horn's 
tactics can be overdone. The 
prime minister has a tendency 
to make up policy on the hoof. 
"I think Horn is a disaster,” 
says Mr Tamas Bacskai, chair- 
man of Unicbank. “Improv- 
isation is wonderful if it is 
done by Moliere, but be is not 
a good improviser.” 

Nevertheless most people, 
whatever their criticisms, 
share the view of Mr Janos 
Bartha, managing director of 
CS First Boston in Budapest. 
“I think that Horn is an 
absolutely professional 
politician,” he says. 

The question is whether the 
Socialist premier can be not 
just a consummate politician 
but a leader' too: one wbo can 
understand Hungary’s econ- 
omic plight and convince the 
people to accept unpopular 
measures. 

Mr Laszlo Urban, economics 
spokesman of the opposition 
Yonng Democrats, has bis 
donbts: “He Lets conflicts 
emerge, evaluates whose 
position is what and then tries 
to please everybody. ■ Even the 
government spokesperson 
concedes that Mr Horn likes to 
be liked. 

That makes the prime 
minister somewhat unpred- 
ictable, a bit of a weather 
vane, but not necessarily a 
man without principle. 

Mr Horn's socialism is of the 
bom-and-bred variety. Bnt he 
has another vision which sits 
uneasily with his ideological 
conviction. “Perhaps it might 
sound like a kind of slogan,” 
he says, “but I want a 
Hungary which does uot differ 
from the developed countries.” 

Bnt that line has become a 
cliche in eastern Europe and 
does not impress many 
Hungarian opinion leaders. “I 
don't tbink be has a vision 
beyond Saturday, no, make 
that Friday," says Mr Laszlo 
Csaba of the Kopint-Datorg 
economic research Institute. 

Visionary leadership, 
however, may count for more 
in the confused countries of 
the former Communist bloc 
than In the settled west Mr 
Vaclav Klaus appears to have 
made a real difference for the 
better in the Czech Republic. 

In Mr Bacskal's view, 
Hungary also had an 
“oatstanding statesman" in 
Janos Radar, general secretary 
of the Commnnist party 
between 1956 and 1988. “In 5D 
years a country is lucky to 
have one such man," the 
banker says. Hungary, he 
suggests, has run out of its 
allocation. 



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FINANCIAL TIMES FRIDAY NOVEMBER 1 11 994 


31 


•t 





LONDON STOCK EXCHANGE 


MARKET REPORT 


Footsie stages strong rally to regain 3,100 level 


By Steve Thompson 

An uninspiring and dispirited 
performance by London's equity 
market throughout a sluggish and 
tired morning session was trans- 
“nned by the latest data from the 
P®* which indicated a marked slow- 
ing down of inflationary pressures 
affecting producer prices in the US. 

Down almost 16 points within an 
hour of the opening, the FT-SE 100 
commenced a powerful and sus- 
tained rally shortly after the US 
news was announced, easily regain- 
ing the 3,100 level and closing a net 
6.3 higher at 3,105.9. 

The news that producer prices 
had fallen by 0.5 per cent, against 
expectations of a 0.2 per cent 
increase, took the markets com- 
pletely by surprise and prompted 
strong gains across internat- 


ional bond and equity markets. 

Wall Street which gave an alarm- 
ingly erratic performance on 
Wednesday evening, initially mov- 
ing up 38 points on the Dow Jones 
Average and then sliding to a 20- 
point net loss before rallying to 
close a shade higher, was almost 20 
points up shortly after it opened 
yesterday. The Dow was 11 points 
ahead well after London closed. 

The first back-to-back fall In pro- 
ducer prices for more than three 
years was seen by markets as a 
potent signal that the US economy 
is slowing and was thought to 
lessen the chances that US interest 
rates will rise more than 50 basis 
points next week. 

On Tuesday the Federal Open 
Market Committee meets to formu- 
late US interest rate policy and has 
long been expected to promote 


another rise in US interest rates. 
Prior to yesterday’s producer price 
data, economists and strategists 
expected the Federal Reserve to lift 
US rates, currently at 4.75 per cent, 
by at least 50 basis points and possi- 
bly by a full percentage point. 

Earlier, London opened on a quiet 
note and almost totally lacking in 
enthusiasm after Wall Street's sur- 
prising lack of follow-through on 
Wednesday. There was no support 
for equities from the gilts market, 
which edged down and showed little 
signs of rallying. 

There was no comfort for the 
markets from Germany, where the 
Bundesbank council met for its reg- 
ular fortnightly meeting and sig- 
nalled no change in German inter- 
est rates. Although most analysts 
had forecast no change, there were 
suggestions in the market that a 


small reduction had been possible. 

London's second line stocks gave 
a resilient performance throughout 
the day, with the FT-SE Mid 250 
Index only marginally lower at 
worst and eventually 9.5 higher at 
3,5-iJLS. 

Turnover in equities was 573m 
shares, with non- FT-SE 100 stocks 
acccounting for around 57 per cent 
of the total There was comfort for 
the City’s harassed dealing teams 
with news that the value of cus- 
tomer business in the market on 
Wednesday was £l.6bn, the tidiest 

for a week. 

It was another heavy day of com- 
pany trading statements, with the 
UK’s two biggest companies, BT 
and Shell Transport, reporting. BTs 
results were above the consensus of 
forecasts but there was a measure 
of disappointment with the dividend 


FT-SE-A All-Share Index 


increase, 6 per cent, against some 
over-optimisitc forecasts of S per 
cent. Shell's figures were In line 
with estimates but the shares 
slipped back in line with other oil 
stocks. 

A big two-way pull developed in 
Royal Insurance, with profit-takers 
moving in an( i outgunntng bulls of 
the shares. 

The market's two newcomers, 
TLG, formerly the lighting division 
of Thorn EML and Tele-Cine, made 
reasonably successful debuts, both 
moving to modest premiums over 
the issue prices. 

Banks continued to outperform 
the market, especially Barclays and 
National Westminster. Northum- 
brian Water was the star performer 
in the utilities sectors after deliver- 
ing a bumper 16 per cent increase in 
the interim dividend. 



Equity Shares Traded 

Turnover by volume (mKton). Excluding: 
Intra-market business and overseas umov*r 
1.000 « 



■ Key Indicators 
Indices and ratios 


FT-SE 100 

FT-SE Mtd 250 

FT-SE-A 350 

FT-SE-A AB-Share 
FT-SE-A All-Share yield 

3103.5 

3542.9 

1556.0 

1540.93 

3.94 

+3.9 

+9.6 

+2.4 

+2.30 

(3.94) 

FT Ordinary index 
FT-SE-A Non Fins p/e 
FT-SE 100 Fut Dec 

10 yr Gilt yield 

Long gBt/squity yW ratio: 

2364.1 

18.72 

3107.0 

8.71 

Z23 

+7.5 

(18.72) 

-9.0 

18.70) 

P-23) 

Best performing sectors 

+1.5 

Worst performing sectors 




+0.9 






+0.9 



._ -0.7 



+0.7 



... -0.7 

5 leisure & Hotels — 


+0.7 

5 Household Goods 


,-O.B 


iA&T mrs 

point pev 




Two-way 
pull in 
Royals 

The stock market took a 
churlish view of third-quarter 
profits from Royal Insurance 
and the shares dropped almost 
20p after the headline figure 
was announced. 

Subsequent reappraisal of 
underlying nuances in the 
results prompted furious 
two-way trading which saw 
turnover of 15m shares. The 
volume was the highest since 


February 1992 but then Royal 
had announced that its losses 
had plunged to £373m and 
shareholders would receive no 
dividend. 

The picture yesterday was 
altogether brighter. Nine- 
month profits came in at 
£31lm, against £l!3m a year 
ago. and although they were at 
the lower end of forecasts some 
analysts bad been over enthu- 
siastic following bumper sec- 
ond-quarter figures. The main 
hit of £l9m came from the 
rebalancing of Royals' invest- 
ment portfolio - the group has 
spent the last year shifting 
£40Qm from bonds to equities. 
But Mr Charles Landa of 
SGST, remained positive on 


EQUITY FUTURES AND OPTIONS TRADING 


Stock index futures had a 
slower day, but levels of 
volume remained encouraging 
and there was steady two-way 
business for most of the 


session, writes Jeffrey Brown. 

At the close of pit trading, 
the FT-SE 100 December 
contract was 3,107, down 8 
points and standing at a 


■ FT-SE too INDEX FUTURES (UFFE) £Z5 per fid Indax poArt 


(APT] 



Open 

Sett price 

Change 

High 

LOW 

Em. voi 

Open InL 

Dec 

3003.0 

31074) 

-9.0 

3120.0 

3082.0 

13589 

55276 

lute 

31130 

3124.0 

-11.0 

3126.0 

3100.0 

422 

4264 

Jun 

- 

3145.0 

-nil 

- 

- 

0 

80 


■ FT-SE MID 2S0 INDEX FUTURES (UFFE) CIO par fu( Index point 


Doc 


35400 3550.0 


-10n 3546.0 36400 


28 


4168 


■ FT-SE MID 250 EPEX FUTURES. (OM LX) £1Q per tuB Index point 

Dae - 3550.0 - - I 

M open hum Agues m tor paten* day- 1 Boot wXumo shown. 


■ FT-SE 100 INDEX OPTION (UFFQ (*3iOSQ CIO par ftJ index point 

2960 3000 3050 3100 3160 3200 3260 3300 

cpcpcpcpcpcpcpcp 
N n 1501a 2h 110 5b Iff 14 33b 31b 13 62b 9 108 1b 181 1 208 

OflC 181b 23b 143b 36 107 50b 77b 73 53b 100 34 131bttb 170 12b 213 

Jan 289b 45b 173b s»b >40 76b I JO 9Bb »b 120b 61b J49b 44 184 31 223 

ft* 227b S3 1*1 66 15^2 85b 130b 85b 103 120b 82b 160b >2 182b 48 230 

Junf 238 103b 178 141b 133 196 83 258 

CMS 4,415 ns «JOO 

■ EURO STYLE FT-SE 100 MPEX OPTION (L1FFE) £10 per Ml Index point 




2075 
132 4 


10 


SOTS - 3125 8175 

51 23- 22b -44b 8b 80 


3225 
2b 124 


201 20b «1 30 1Mb 43 fflb 60b « B'-* 110*2 * 1« 14b 182 

222 33b 180 47 151 62 122b B2b «b 104b 74 133 54bl62b48b 108 


Mm 118b 1 
Dec 

Jan _ _ _ _ _ 

Mar 248b 55 181b 85 126 126 . 02 101 

Jari 280 78 - 225 108b 168 148 . IVtfOTfc 

Cafe 1.967 Pat 2.115 * UnM0« MMt tabu. Prantom Mom m MM an saUnml prices, 
t Lena Med upfcy note 

■ EURO STYLE FT-SE MD 250 WEX OPTION (OMUQ £10 par Ml Index point 


3275 

1 172 


3400 3460 3500 3550 3000 9850 

Oct M5b Sb 86 15b 3>b 34% 

Cate B Ws D SsOamrt prices and <tan a* Men at 430pm. 


FT - SE Actud- es Share indices 


3700 3760 


the stock, arguing that Royals 
was “sacrificing investment 
income today for capital 
growth tomorrow". 

Anal ysts also said the pre- 
sentation was impressively 
upbeat. The shares, which 
have performed very strongly 
over the past few weeks, ral- 
lied from their low but closed 5 
off at 295p. 

Burton jumps * 

High street retailer Burton 
Group was one of the day's 
most active stocks as the 
market celebrated a robust set 
of annual figures from the 
company. 

Turnover at the close stood 


premium to the cash market of 
4 points. Fair value was 
around 6.5. 

Turnover came to 11,592 
lots traded, down from 15.363 
on Wednesday. There was no 
great weight of selling, and for 
much of the morning the 
premium to the cash market 
hovered around 20 points. 

Traders were encouraged by 
what they saw as broad 
resilience after the previous 
day's fireworks which ended 
with a 44-point gain on the 
back of a strong early Wall 
Street. 

Yesterday afternoon's 
proceedings were mostly left 
to the local, independent 
traders, with the bigger trading 
houses retiring to the sidelines 
once WaJJ Street showed signs 
of becoming more volatile. 

In late, screen based trading, 
the December contract dipped 
below 3,100, with contracts 
numbers rising to more than 
13,500. 

Traded options volume was 
24,636 lots, down from 35,998 
on Wednesday. FT-SE and 
Euro FT-SE trading a counted 
for just under 13,000 
contracts. Ladbroke, at 2.000 
lota, was the most active 
individual stock option. 


: Series' 




OaVe Year 

Dtv. 

Earn. 

Pi E 

Xd adj. 

Total 


Now 10 Chge96 Now 9 Now 8 Now 7 ago 

y)ekJ% 

y)ekJ% 

ratio 

ytd 

Return 


31035 

+ai 3099.8 3083.8 3065.8 3099.7 

4.11 

7.05 

16.76 111.99 

1176.00 

FT-SE MM 290 

3542J 

+0.3 3533J 3519.7 3520.1 3434.6 

3^4 

279 

20.63 11231 

1324 J2 

FT-SE MM 250 «x kiv Trusts 

3545jJ 

+U3 3533.5 3521.7 3622J 3432.6 

3.70 

626 

19.40 117.70 

1322,66 

FT-SE-A 350 

1566.0 

+02 1553.6 1538.4 15382 1543.9 

328 

276 

17 54 

54.71 

1208.11 

FT-SE SmaBCqp 

1782.13 

1701.83 177824 177471 1771.46 

3-32 

5.00 

2523 

5262 

1387.73 

FT-SE Smeecap ax Inv Truete 

1750.06 

+0.1 1750.05 174B25 1748.68 1754.12 

352 

256 

2Z99 

52^5 

1367.86 

FT-SE-A ALL-SHARE 

154093 

+0.1 153&53 1524.42 1525.10 152921 

204 

6.63 

17.93 

5248 

1216.89 

■ FT-SE Actuaries All-Share 

Day's Year 

Dtw. 

Earn 

P/E 

Xd adj. 

Total 


Nov 10 chge% Now 9 Now 8 Now 7 ago 

yWd% 

ytoW« 

ratio 

ytd 

Return 

10 MMEHAL EXTRACTlONtfB) 

2701 07 

-0£ 2715J9B 2690.90 2685.85 244720 

240 

206 

24.08 

89.83 

1090.84 


3803.43 

+02 37B4.63 360221 3791 £4 3003.70 

3J7 

240 

22.92 

98^2 

1049.53 


2675.84 

-0.7 269534 2662.66 2656.76 2460.40 

264 

5.61 

22.10 

9244 

1105.42 

16 08 Exptomaofi ft Predfll) 

1871-52 

-03 1676-67 1872.34 1876.86 188220 

222 

X 

4 

3203 

108283 


20 GEN MANUFACTURERS^*?] 

21 Bulkftig & CaoSttueBonQSt 

22 BuOdhig Matts & Mereha(32I 
33 ChamtaU»(23) 

24 Dhwrafflod Industnatatie* 

26 Electronic & Bool EqulpOfl 
SS EngmooringfTI) 

27 Engtoeerino, VehidesflZ) 

28 Printing. Paper & ftriqjUM) 

38 Texttes & AppartigO) 


1881^6 

+23 1874.80 1559.19 1855.96 189&10 

4.06 

211 

2272 

6824 

96254 

1057.50 

-22 1080.10 104320 104250 113240 

275 

5.30 

24.83 

3233 

B3259 

1857.79 

+0.7 1844.59 1B24^S 1819.93 1882.60 

4.01 

223 

23.19 

66.90 

879.94 

2288.05 

+OJ 2277A5 227210 227255 214260 

4,05 

4^1 

27.74 

79.58 

1015 79 

1704.75 

+23 1789.99 177256 1760.02 1S6270 

211 

213 

23.43 

8275 

923.04 

1901.37 

+0^ 1882.00 187207 187244 206ZJ0 

207 

260 

1B.07 

61.88 

932.07 

1B0R99 

+02 180214 179220 179428 1707.70 

216 

4S9 

2276 

53.69 

1038.58 

2292.48 

-02 229208 287217 2272J37 1980.40 

4.36 

1 J52 

SO.OOt 92-54 

1J21JB 

2804.76 

+0.1 280204 2780.06 278204 237260 

207 

238 

81.72 

7271 

110274 

1574.84 

+1 JS 1561 JS/ 154236 155030 190290 

4.28 

287 

17.64 

61.29 

898 74 


30 CONSUMER 00006(07) 

31 Btmnrtaef17] 

32 Spirits, Wines 5 CWerrflCO 

33 Food Manufacturere<2SI 

34 Household Goods(i3) 

36 Health Care(21) 

37 PhanraceuticalanS} 

) 


2775.05 +0.1 2771.76 2724.88 2723^6 2740.40 

2238-36 2239.37 2233.42 224463 198850 

2848.20 -0 A 288036 2819.70 280562 2598-90 
228068 -0.1 229056 228047 2284.64 2270.00 

2354.78 -OS 2389.68 2384.46 2388-83 2639-20 
1663-56 -03 1588.74 169&S2 160&26 1663.10 

3103.13 +04} 3085.99 3000.57 299450 3064.10 
3754,12 +0.63733.14 308448 361940 4233.70 


4J3 

7J24 

1293 109.09 

959.86 

4^3 

7^9 

15.7E 61.43 

1002.08 

292 

278 

16.96 101.23 

959.01 

4.25 

7.64 

1212 8247 

S70 49 

288 

7.71 

15.52 Bfl.90 

852.75 

219 

240 

41.37 4224 

922 60 

4.35 

294 

1266 12627 

99323 

5.7S 

aie 

11.73 217JJ7 

858.34 


40 8ERV1CES{210) 

41 Dtetribuu>re(30) 

42 Leisure & Hotnfc*25) 

43 Media(39) 

44 Ftetofere. FoodflB) 

45 FMaflere. GeneraH4S) 

48 Support Servic8s(41) 

48 Tnmspoftne) 

51 Other Servteoa A BualnajjjgL 


1915.8S +06 190663 1883.07 189562 

2629.13 -0.7 254663 253662 253168 

2065.77 +0.7 209048 202166 2021.22 

2853.40 2854.72 2823.77 2841.09 

178023 +07 1747.18 1723.63 172266 

161963 +OB 1604.74 1606.64 161465 

152662 +01 152669 151464 161162 

2262-96 +06 2252.75 223869 2222.50 

15»43.6S -0-1 1245.19 125061 1253.32 


2661.10 

1802.10 

2808.10 

149560 

1875.90 

1605.70 

227360 

1205.60 


226 

258 

1244 

5230 

942.96 

274 

72S 

1230 

3525 

B80.B8 

235 

423 

2427 

57JS 

1021.34 

2-43 

525 

22.19 

7205 

993.04 

271 

9-10 

1329 

5227 

1054.30 

330 

7.05 

17.69 

4520 

868.04 

2.78 

6 37 

1824 

35.92 

931.64 

27B 

624 

1289 

61.02 

889.35 

4.07 

214 

4214 

2263 

1070.82 


60 UnUTE8(38) 

62 Sactnd1y(17) 

64 Gas Distribution^} 

SS Td tt c nmMUfttcae awW 
68 Watar{13) _ 


68 NON-HNANCIALS»37L 

70 HNANGMLSCI04) 

71 BankshO) 

73 bsurerwetlT] 

74 Uto AssurancefE) 

75 Merchant Banke(8) 

77 Other Rnanctal£4) 

79 Propertyfrl) 


242029 

2652.80 

196291 

201215 

184728 

-24 2429.70 241406 242288 2448.60 
+0.1 2651 .34 2S46J51 2554^46 2127.60 
-02 107323 1041.49 1941 >19 208320 
-0.9 2032.78 2004.16 2Q20.90 2214^0 
-02 1851.98 1882-54 1889.42 182870 

4.40 

3.60 

6.08 

4.19 

522 

725 
9.70 

t 

726 
13.22 

15.47 K.97 
1220 83.46 

*11726 

15.48 5022 
8-23 7520 

935 96 
1081.61 
924.36 
859.34 
026.61 

166263 

+0.1 1660.83 164421 1845.18 1634.65 _ 

3-92 

8.42 

18.72 56.70 

117921 


2201.83 +04 2192.42 2177.83 218096 229660 

292366 +0.9 28BT.45 286029 2873.04 2802.90 

124568 -06 125563 125265 125665 1446.50 

237661 -02 238063 237007 238047 2612.70 

274034 +06 2727 . 12 271564 £700-48 3086.30 

1858.40 -01 186161 164161 182569 1722.00 

+06 143969 143961 144667 1661.00 


60 WVEBTMBIT TRUST Sflafl _ 
99 FT-SE-A ALL-SHAREPK) 

■ Hourly movements 

Open MO 


2735.41 

154063 


-02 2739 AS 2717.17 2715-63 2662.00 


+01 1538-63 1524.42 15SS.19 152961 


4.39 

8.84 

13.11 89.85 

876.41 

4.13 

9.71 

11.78 116.39 

879.08 

5.45 

9.46 

12.08 61.61 

sea 05 

528 

725 

1524 12722 

919.70 

379 

1048 

11.08 87.7 3 

827.47 

3.74 

8.49 

14.00 6425 

997.53 

422 

4.48 

28.06 44.76 

82727 

225 

1.96 

51/47 56.97 

021.13 

324 

6.63 

17.93 53.48 

1216 89 


1060 1160 1200 1360 14-00 1660 18.10 Hlgh/day Low/day 


oogHP 3084.0 30846 308S6 30866 30996 30902 3103.7 31056 30816 

Si 3532.1 3530.7 35336 3S3S6 3536.4 3536.6 3540.0 35428 35412 3529.5 

Sl6‘ 15505 15476 1547.8 154&5 1548-7 15500 1554.1 1556.1 1557.0 15404 


FT-SE 100 
FT-SE MU SO 
FT-SE-A 350 

TkiM el FT-SE 100 Day*® Note 462pm Dm"* W* 06flam. FT-SE 100 1094 2S3Q6( 22 ) low: 28768 CM® 

■ et-se Actuaries 350 Indusliy baskets 

1060 1160 <260 1360 


Qpm MO 


ESdg & Cnstrth 

PhBITUOBUdcIS 

Water 
Banks 


1002-7 1002.4 10026 0996 


T4jO0 

1&00 

16.10 

Ctose 

Previous Change 

9903 

10002 

10002 

1000.3 

100*0 

*3.7 

3088.1 

3069.3 

30742 

30752 

3057.0 

+17/4 

1 643.0 

184JLB 

1647.S 

1845 £ 

1849.7 

-3.9 

2931.7 

29472 

2057.1 

2960.7 

29333 




at a hefty 19.2m and the shares 
climbed 7 Vi to 71p. Burton 
reported profits of £41. lm, up 
from £ 1 6.3m, and maintained 
the final dividend at 2p. 

Brokers upgraded current 
year profits forecasts, and joint 
broker BZW was said to have 
weighed in with a sharp 
increase of £15m to £70m. How- 
ever. BZW was unavailable for 
comment. 

A rival broker said: “There is 
a lot of comfort in these fig- 
ures. For one thing there are 
□o nasty surprises. It seems as 
if thing s are beginning to get 
back on track. We must now 
wait to see how the trends that 
have emerged this year 
develop." The favourable senti- 


TRADING VOLUME 


■ M^for Stocks Yesterday 

VO). Champ Day’s 
000a pnea change 


Wt 

ASOa Groutrt 
Ahhoy Naaonslf 
Albert Hsher 
Aftod Oornecqt 
Ang tan water 

ArWIGroupt 

Wtggmst 

Assoc. BrtL Fooast 

Aa lac. Brit. Axes 

BAAt 

BATUKtet 

BET 

BICC 

BOCt 

BPt 

BPB met. 

Bn 

emt 

Bam d Seoriardt 

Bojrfaynt 

Boast 

BtusOrdot 

BOOfcCT 

Boont 

Brnwort 

Bril. 4snap«cet 

BrOrsO AMMVst 

Bntren Gad 

■miii Lam 

Brush Siesft 

Burnt 

BrnnahCmn&t 

Burton 

CitHe &Wr*t 

CatCtuy Schwccpsst 

Caradcnt 

Canc-r Cjmrrn.t 

Ccua Vtysb 

Ccimi Unort 

Coohson 

CoucauKJst 

Datguy 

Os La Rust 

Dotona 

Eastern BtctT 
Eas MkSanc! Bws. 
Bscrocomp* 

Eng Clma days 
CTO apnsa Q*t 
Euroasawl Uruta 
FN 
Haans 

i« CaLT. 


906 329 

6.400 04 

4.100 4 » 

507 43 

97B 599 

J.MJ 518 
174 341 >2 
iOOO 208 
855 27112 

2BG 550 

3.100 ZT4 

1.400 502 

3200 448 

3600 109*2 

405 350 

977 711 

5.500 4&>l 2 

1^00 304 

10.000 383 Lp 
0200 307 


1 AX) 
6,700 
1.400 
2.100 
sn 
1600 
360 
734 
8600 


200 

807 

550 

298 

413 

521 

444 

457 

371 


3.100 296 >2 

1.100 388 

13.000 157*2 
SE 1B4 
7H BB7 

31.000 71 

9400 368 

1.000 4+4lj 

297 277 

VO e 68 

3.600 202 1 ; 
IJOO 545 


313 

1.500 

737 


351 

450 

421 


508 1000 

1600 184 



565 

JH 

142 

182 

1600 

575 

402 

4600 

971 

1,900 

1600 


804 

685 

471 

3S5 

180 

251 

162 

125 

134 

231 

575 


3.B00 287'- 

10000 622 


Gunirart 

HSaC<75p«B«t 


1 . 10 ) 

235 

2200 

350 

2.600 

756 

839 

MOO 

29 

5.300 

1300 

398 

1.600 

478 

4.100 

1,700 

22 

812 

54 

3800 

&55 

445 

787 
3CC 
1 800 
313 
8S 


Haraorrf 

Hantama Crcafiekl 
rtsya 
htesdawn 
IUI 
Ctt 

biehcapat 

Jomaui Martwv 

KmofisiwrT 
Kw* Sovt 
Lsrttrofcet 
Uno Seomueat 
LapurM 

& Gcnarart 
UonXi Attfcoy 
UoydS BanM 
LAS7JO 
Lonoon Bon 

Lonriio 
Lucas 
MEPCt 
MR 

Manweb 

Manes & Soenewt 
MidinnOa Ban. 

Momwn Wlal 
NFC 

NatWust Banst 
National Poaert 
New 

North V/est Wared 
N* tnam a»r' 

Morhorn Foodxt 
NorweO 
Peanuwt 
P&OT 
Pilkmgtcin 
PorwaOant 
PvuOermalt 
RMCt 
RTZt 
Fbcal 

Rank Ore-T 
Rocvtn & Cohnant 
Rsdbmdt 
Raedtnat 

RontoWt 
Reuterat 
Rote Rovnrt 

Ryl Bk Soutandt 

Royal Insurance? 

Sarecurrt 
SchmtsrsT 
5com* 8 Nrwt 
ScrM. HVeho-Beo. 

Soortwn Po«b4 
Sent 
Serlflwk* 

SeoboarO 
Severn Tionrt 

Sion Tranipwrf 

te*et 
Sk-tugn Ests 
South (W>u 
Srruth 8 Nepnowt 
SmW Beevtiamt 
Snoa BMW am UK.T 2.800 


346 
517 
413 
550 
190 
815 
4£0 
72* 
343 
232 
166 
S» 4 
175 
320 
762 
436 
571 
474 
553 
154 
620 
77* 
433 

334 

574 

145 

727 


3.600 149*j 

1 000 198 

1,100 416 

329 139 

122 820 

4.800 4(14 b 

3*3 777 

5,200 140 

(Ml ITU 1 ' 

1.800 516 

1JJOO -95)j 

s.700 247 


781 

335 

1.500 

131 

S45 

852 

S6t 

191 

1JW 


544 

816 

204 

618 

620 

640 

186 

557 

321 


218 1008 
2,400 841 


1.300 

1.000 

257 

1.000 

922 

872 

3JM0 

7.100 

urn 

16000 

911 

10 

228 

925 

*59 


1.000 

960 

6.400 

«E- 

1.500 

383 

SM 

3.000 


482 

1200 

233 

2.1(10 

721 

1600 

L300 

3100 

1.000 

658 

3.900 

7.800 

1.200 


3S0 

408 

588 

461 

765 
232 
478 
175 
456 
295 
41* 
1 368 
510 
331 
356 


J3£. 

558 

711 

549 

456 

144 

421 

385 

459 

814 

815 
SCO 
788 
593 


275 
331 
218 
369 
228 
129 
*30 
1J4 
245 
500 

1010 

ijeoo 2i7ij 
an S2 

548 361 

1.700 1129 

144 314 

fi£5 630 
2^00 2l2>2 
Sir 646 


*1<4 

*5 


♦ 1*2 

-a 

*2 

«3 

•a 

-i 

-7 

- 1<2 

72 

-41j 

'1*2 

*2 

,9 

IS 

♦I 

#5 

-2 

tS 

n 

*1»2 

-2 

-I 

•e’j 

*2 

h! 

*7 

.3 

-1 

rfi 

•1 

-7 

-1 


Mlf 


*5lj 




-2>I 


Smiths Irws 52 

Southern SroT 1,400 

Soutfi Wates Bed. 10 

SartiWepWaw I.1D0 

Seuh w*«t. B*'7i 
Gmjttwm Water 
SrahCant ChanO-t 
Srorehouso 
Sun AUanoet 

TIN ^ 

71 GreupT 
TSBt 
Tarmac 
Tala 6 Lite 
TayW Woourtiw 
Teecet 

TTiamss Warert 
Thom Brilt 
Ton8urnt 
TratalBar Houso 
Unigfla 
iMnert 

United BACUBi 
UU Newspapers 
WxJaftnet 
Wurtung (Stj)f 

Wefcomel 673 

We«t Water C48 

Wwer Water 3'* W 

MiAreaat ’ *®« 55 s 

Witaro NkjaaT -'W J ve 

WAs Corroor 2200 13 7 

Wmoey 95 139 

WWseteVt 36* 786 

Yoftiahrt Beet >2 7*0 

YMahha Water 30? 532 

Zanreat 1 3M ^ 

Based on trwwig vaume lot a srtwoon (ri mnjoi 
secumes deoil omoush cw SEAO syLtem 
yaauritey uKi 4 JOpm Tractor, el nvkwi <jt 

more are raundea down t indcates an FT-5£ 

1 00 Inde* conshtuem 


rlB 

*"2 


r5 

* 1*2 


ment in Burton also boosted 
Next, which added 5 at 247p. 

Telecoms buzz 

Telecoms shares had another 
hyperactive day, with Cable 
and Wireless losing further 
ground and BT dragged lower 
as slight disappointment with 
the interim dividend triggered 
profit-taking. The two stocks’ 
combined trading volume was 
almost 20m shares. 

BT finished 4*4 easier at 
3S8Vip, with most analysts pin- 
pointing the interim payout - 
up 6 per cent, after a 6.3 per 
cent increase for last year's 
final dividend - as the reason 
for the sell-off in the face of 
generally strong trading 
trends. According to Hoare 
Govett, second-quarter under- 
lying profits rose 5 per cent 
after 3.7 per cent in the first 
three months. 

C&W fell 7 to 385p as ana- 
lysts got to grips with the man- 
agement shake-up and fierce 
margins squeeze under way at 
the group's Mercury arm. 

Mobile phones group Voda- 
fone managed to ride above the 
bearish mood, gaming 1% at 
212%p following news of the 40 
per cent sales advance at BTs 
Cellnet unit 

Shell Transport dropped 8 to 
7l9p after revealing a slight 
fall in third-quarter current 
cost net income, the figure that 
ignores the effect of shifts in 
the underlying oil price. The 
profit of £853m was down from 
£86lm last time but well within 
a broad range of forecasts. 
SGST, a keen supporter of the 
stock, argued; “The two prob- 


NEW HIGHS AND 
LOWS FOR 1994 

new Hiatts pal. 

BREWBWS HI WMhanpoon UELJ. BUHDfNa 
* CHSTRN ( 1 ) VKmptent MSnwUTORS fl| 
Rnollat. ELECTRHC A ELECT SOUP fS) 

EncMon (LM.L Karate* (A3, Ma^vii Power, 
Thorpe (F.WJ. UnHectl. RETMLStS, OENERAL 
tO Ooktentths, SUPPORT BBrNS 0) MMT 
Computing, TRANSPORT (1) Jacobs UQ. 
AMBflCANS (2) AnMMd, Data QowbL 
NEW LOWS (77). 

WL1S (1) BANKS (2) IttautteH. SunUmo, 
BUU-DHQ ft CNSTIM n Avonskfe, Boor H. 
Eve. BUM MAILS ft MOOTS 12} Ct*M. Erwor, 
CHEJOCALS (1) BTP. DBTflBUTORS (4) 
Bumdaoe. Ototema. aen ct wwtan. QUcka. 
nvutantu MIMS (I) StaeNey fexte, 
ELECTDNC ft ELECT EOUP (1) Hmttra 
tNGMEBWO (3) QBE InD. Hwitlng. Moho, 
ENCL VEHCLES (1) HgteTL EXTRACTIVE 1708 
M Dragon Wring, NSM. FOOD MANUP (tt 
Banfal (SWrwy CJ. HEALTH CARE (4) AAH. 
Amaraham tari. Putenec teca . Premter I leatav 
HOUSEHOLD OOOOS (1) Vyirana. INSURANCE 
CT Haaui (&EJ. JB. Lowndas laital, 
INVESTMENT TRUSTS fUJ LEBURE ft 
HOTELS (2) Ban A WAT W. BuilatfL LE=E 
ASSURANCE (1) London 6 Manchester, MEDIA 
CO Bloomsbury Men, Holmes Merchant. OIL 
EXPLORAIMN ft PNOO n Corn-Tail Haa. 
Copfeot Rep. Oobal hand R»a. Pieekto Oi A, 
Sunrise Eitergy. OTKB1 PMANdAL (3) Exco, 
Hoitatt Ina Swvlce, IAF, OTHQt 8BIVS ft 
BUSNB (I) Capa Range. PRTNG, PAPER ft 
PACKS m Bemrose, Brtu Thornton, khiereak. 
Wace 8pc Or. PI., PROPERTY (4) MaurbMei 
Ests., Neup un . Southend Prop Bpc Cv 2020. 
Union Sauam. RETAILERS. OEffiRAL Eebsh 
F unKiae. Rne Art OMpn. MatetL 03. SPUm. 
WINES A CtDStS (1) Mwrydown. SUPPORT 
9ERVS (2) RslatL Spargo Ctelft. 
TELEOOMMUMCAnONS (23 Cttete A Win), 
tenon T ft T, TEXTILES • APPAREL HI W. 
Raadtcut, RkMida. Swwood. 

lem areas (Shell (Ml and Chem- 
icals) ... are improving their 
performance at a faster rate 
than can he expected, and an 
earnings upturn in 1995 should 
underpin share price outper- 
formance." 

Dollar influenced pharma- 
ceuticals stocks moved into 
positive territory with the 
opening of Wall Street US buy- 
ing was still in evidence, with 
the heavy dealing of the past 


couple of days revealed to have 
been carried out through the 
Instinet system, Reuters’ US- 
based equity brokerage service. 
Glaxo added 5 at 622p and 
Wellcome rose 9 to 673p. 

Meanwhile, Fisons unproved 
4 to I25p with 4.8m shares 
traded as bid speculation con- 
tinued. Among the companies 
cited as possible bidders are 
Zeneca, off a penny at 870p, 
Amersbam International, still 
reeling from disappointing fig- 
ures on Wednesday and down 
19 at 909p, and Medeva. a 
penny up at I73p. 

Shares in Northumbrian 
Water jumped 16 to 712p after 
the company posted favourable 
interim figures which included 
a surprise 16 per cent dividend 
increase, well above the 5 per 
cent guideline adopted by 
water companies in recent 
years. Profits more than dou- 
bled to £46.lm. However, one 
analyst said: “Shareholders 
will welcome the increase in 
the dividend, although it will 
raise the political pressure.” 

Among food retailers, Ice- 
land hardened a penny to 161p 
following a recommendation 
from Pawn ure Gordon, and 
Morrison Supermarkets moved 
S'A ahead to 140p after Hoare 
Govett changed its recommen- 
dation on the stock from 
“underperform " to “buy. 

Anglo-Dutch group Unilever 
continued to be a nervous 
trade ahead of today’s third- 
quarter figures and the shares 
lost another 5 at 1129p. 

Textiles group Coats Vlyella 
rose 8% to 202V s p after the com- 
pany said it was looking to sell 
its yams and fabric arm and 


its carpet divisions, and had 
received a number of 
approaches. 

Drinks group Taunton Cider 
was particularly busy. Volume 
jumped to 7.7m. as the equiva- 
lent of around 3.4 per cent of 
the company’s shares changed 
hands, with one dealer point- 
ing to a tax related trade. The 
shares closed a penny lower at 
151p. 

Reed International benefited 
from a presentation to analysts 
on its professional publishing, 
particularly its electronic infor- 
mation side. Several analysts, 
including the team from Hoare 
Govett. came aw ay feeling 
reassured and the shares 
closed 4 higher at 765p. 

First day trading in TLG, the 
former Thom Lighting, ended 
in a comfortable premium with 
the shares standing at 124p, 
against a flotation price of 
115p. Computer software group 
Tadpole Technology dipped 8 
to 432p. 

Eurotunnel remained a 
lively market ahead of Mon- 
day's start to direct train run- 
ning between London and the 
Continent, rising 13 to 251p for 
a four-day advance of 9 per 
cent. The driving force 
remained the Paris market, 
where 2.1m shares changed 
hands yesterday - against 
under 0.6m In London - to 
become the most actively 
traded French stock. 

MARKET REPORTERS; 

Peter John, 

Joel Kibazo, 

Jeffrey Brown. 

■ Other statistics. Page 21 


LONDON EQUITIES 


UFF£ equity OPTIONS; 


RISES AND FALLS YESTERDAY 




..... 

Cafe 




Ms 


Ootton 


Jao 

AW 

J* 

Jan 

Apr 

Jul 

MMDcaeca 

550 

54b 

64 

70b 

4b 

10 

ISb 

(*598 I 

fi«J 

10 

32b 

40b 

22 

29*s 

41 

Anno 

260 

IS 

22b: 

27b 

10 

15b 

Mb 

(*268 ) 

280 

6b 

13b 

18 

22 

2fib 

32b 

ASOA 

60 

6b 

8b 

10 

2b 

4 

5 

1*84 , 

70 

2 

4b 

6 

8 

9b 

10b 

Brit Airways 

38u 

22b 

M 

40b 

I2b 

1Bb 

26 

(*371 1 

390 

9 

20b 

27 

30 

35 

42b 

SoUBobiA 

420 

18 : 

Z7b 

35 

18b 

26b 

32 

T420 1 

4£0 

5b 

13 

20 

46b 

52 

56 

Boots 

500 

29b 

42 

50 

11 

IB 

23 

rsro i 

560 

8b 

is: 

26b 

40b 

43b 53b 

BP 

420 

19b: 

28b 

36 

12b 

20b 

25 

f422 1 

4W 

S 

12 

20 

39 

4«b 

4B 

Brttsfi 9Bd 

T40 

ao 

» : 

27b 

2 

3!+ 

6 

(*157 ) 

160 

7 

12b 

16 

9 

12 

14 

Bass 

550 

16b: 

27b; 

3Gb 

27b 

Mb 

41 

rsso i 

660 

3b 

iib 

19 

67 

70b 

74 

Mini 

360 

Mb 

45b I 

53b 

8 

15 

19b 

1*386 ) 

390 

18: 

29b: 

J7b 

20b 

2Bb 

34 

CoutauUb 

4U 

37b 

48b 

55 

B 

12b 

19b 

C450 1 

460 

ish 

26 

34 

26 

Mb 

39 

Cwirr Urann 

543 

25b 

34 

- 

18b 

Mb 

- 

T545 1 

592 

7b 

ISb 

- 

50b 

66b 

- 

IQ 

750 

38b 

S3 1 

Kb 

17b 

36 

46 

1*762 1 

800 

15b: 

29b ■ 

40b 

46b 

65 

74 b 

hingfeiKf 

460 

32 

45 

48b 

I2b 

20 : 

2Bb 

1*474 | 

5 00 

13b : 

26b JOH 

33 

41 

SO 

Land Seo» 

600 

28 ■ 

41b i 

18b 

11 

10b 

Art 

i 618 i 

650 

7 

19 : 

24b 

42 

44 

56 

Marts 6 5 

m 

23b 

33 

37 

7H 

13 

17 

rw i 

420 

8 

18 : 

2ib 

23 

27b 

32 

MaWesi 

500 

34b 

43! 

52b 

12b 

28 

33 

rsis i 

550 

12 

20 : 

30b 

40b 

S7b 

82 

Samswv 

390 

34 < 

48b : 

51b 

6b 

12b 

18b 

1*416 1 

420 

ISb 

29 

36 

18b 

25b 

32 

She! Tran. 

TOO 

31 

42 ■ 

89b 

n 

20b 

32 

(*<12 • 

750 

8b 

19 

26 

41b 

56 

60 

Smenotite 

200 

19 

23 : 

Sb 

4b 

6 

7b 

1*215 i 

220 

7 

12 

IB 

12b 

15 

17 

Trafalgar 

60 

6 

9 

11 

4 

6 

7b 

C82 1 

90 

!b 

5 

7 

10b 

12 

13 

Unlever 

1100 

51b 

72 1 

Wn 

18b 

35b 

«b 

1*1129) 

1150 

25 

45b 

58 

43b 

61 

72 

Zeneca 

850 

46b 

63 ' 

73b 

18b 

37 

44 

(-870 i 

900 

22 

38 ' 

19b. 

44b 

63b 

71 

Oporn 


Now 

Fab 1 

ttay 

NOV 

Feb i 

1** 

Grand Mei 

990 

24b: 

33b 

46 

1 

lib 

15b 

(*412 j 

420 

4b 

17 : 

Mb 

iib 

26b: 

30b 

Lad*** 

140 

15 

20 

23 

- 

3 

6b 

ri54 i 

160 

2 

9 

12 b 

7 

ii 

16 

UU B Baals 

300 

14b 

25 : 

30b 

1b 

7b 

1C 

mi i 

330 

1 

11 

16 

I7b 

23 : 

33b 

Opftn 


Dec 

Uv 

Jun 

Dec 

Mar 

Jut 

Rsnre 

120 

11 

IB 

20 

S 

9 

10b 

1*125 I 

130 

6b 

lib ■ 

15b 

10 

14 

ISb 

Opnon 


New 

Mi 1 

Mar 

Nw 

Feb I 

Wa 1 

Brv Am 

420 

391 

58b 1 

B5b 

2 

i3b 

23 

1*457 1 

460 

IQb 

32 

45 

14 

30 ■ 

12b 

BAT inds 

4» 

29 

42 ■ 

49b 

I 

9 

19b 

r«7 i 

460 

4b ' 

19b 

28 

IS 

25b 

40 

BTR 

300 

10b 

zi : 

26b 

2b 

9 

i6b 

(-307 1 

330 

1 

B ' 

13b 

22b 

»b 

34 

BN Telecorn 

360 

29b : 

32b 38b 

- 

6 

a 

(*388 ) 

390 

5b 

13b 

21 

6b 

ISb 

22 

lanuySai 

420 

26 : 

J7b 

43 

ib 

6b 

14b 

1*444 ) 

460 

2b 

ISb 

22 

J5b. 

24b 

35 

Eastern Bee 

BOO 

17b ‘ 

13b 

63 

15b 

46 ! 

56b 

r«n i 

850 

s: 

Mb 42b 

49 

74b 1 

Mb 

Giannes 

460 

12 

as 

34 

3 

ion 

21 

1-467 I 

500 

b 

9 15b 

33 : 

34b 

44 

GEC 

CflO 

lib 

15b 

24 

1 

Bb 

11 

1*288 J 

300 

2 

7 

14 

12 


zm 


Sumo 


Option 


— Cafe ftits 

No* Fail May Nov Feb May 


Hanson 220 13 17 20 V» Sli 9»5 

(-232 1 34 0 th 7 lOH 9 I5V» 30 

Usmo 134 12 - - H - - 

n«) 1M W - - P* - - 

Lucas hds 1B0 18 24 28H - 3H 7 

(-107 » 200 3«* 12 17 SWr IIMi 15h 

P ft 0 600 42 58V» G7V» 1 1015 25W 

(-640 1 650 8 2814 40 16W 30 49* 

fWaigtW m an 13W T8H 1 5*» 8*4 

f188 ) 200 Vi 5 914 12* 17 19h 

Prudential 300 21 3014 34 W 6 12)4 

(-320 I 330 2V4 13J4 1714 11% 19 28 

RTZ BOO 4315 6614 77 1)4 14Yt 29 

C640 1 850 10 38U 4814 18 34hf 52 

Rettand 480 10 Z7 35Vi 7 20 34 

r-teo ) 500 »» 11 19H 39H 44«r BWt 

Royal mscs 200 17 30 34V4 2 10 15^ 

(-294 ) 300 5 1014 M» 10 19 25'4 

Tent 240 7V» 17H 33b 2 0)4 14b 

(■245 1 260 V4 8 14 15 20 25^ 

VOdalme 200 14 20b 27 1 7 10 

(-212 ) 217 314 1114 - 714 14V* - 

mibm 325 34 - - i - - 

1*348 I 354 3W - - 8*4 

Opaon Jan Apr JU Jan Apr Jii 

BAA 500 1 TH 28b 38b 75 20 29 

ran ) 525 a 17 b - 31 35 - 

Hants Mr 500 22b 36b 43 16 23b 34 

{*501 ) 550 5b 16 22 50b 54b 65b 

Option Dec Nor Jan Dec Iter Jun 




50 

0 

7 

14 



0 

14 




74 

81 





411 



3 7 

98 

41 




04 

23 

333 

7 






76 









41 

43 

31 

Totals 


554 

522 

1510 


Data based on thaw commnJes toted an Dn London Share Sarjica 


TRADITIONAL OPTIONS 

November 7 
November 18 


Fate DeaSnga 
Last Dealings 


Expiry 

Settlement 


February 9 
February 23 


Coils; Avesco, Bk of Ireland, srtera. Crossroads 08, Buie* inti, Ovocs Res, 
Mkuntrt, NSM, SmurfK fJ), Ttdow 08, Wiggins. Puis ft Calls: Glaxo. London Beet 

LONDON RECENT ISSUES: EQUITIES 


Aobey Natl 

420 

16b ; 

28b : 

32b 

10* 

23 

29b 

r«3 ) 

480 

3 

12 

ISb 

38 

49b 

54b 

Amstrad 

25 

4b 

5 

6 

h 

lb 

2 

rai 

30 

1W 

2b 

3b 

2b 

4 

4b 

Barclays 

600 

25 . 

iib 

51 

14b 

30b 

39 

f*605 1 

650 

6b 

20 

30 

47 

61 

66b 

Hue C4<tie 

280 

2iw : 

23b 

35b 

4 

Bb 

16 

(*296 1 

300 

10 

18b 

24b 

12 

17 

25b 

Bntcn Gas 

280 

21 

29 

34 

2b 

7 

13 

1*297 1 

300 

Bb 17b 

23 

9 

14b 

22b 

Otaxfc 

180 

IBb 

23 : 

28b 

3 

Bb 

12 

(-1W 1 

200 

7b • 

12b 

IB 

11 

17b 

2ib 

HfedDMi 

160 

ire 

21 

24 

t 

3fc 

re 

(*175 ) 

160 

4b 

9 

13 

8b 

12b 

i7b 

Lwuha 

140 

14 ' 

16b 

22 

3 

7 

9 

T149 J 

160 

4b 

7 

13 

13b 

18 

ro 

Nad Power 

480 

39 

52 

63 

4 

12 

i8b 

(-496 1 

500 

14 

29 

40 

19 

28 

36b 

Scot Power 

330 

32 

39 

47b 

4 

12 

16b 

<*355 1 

360 

13 

22 

32 

15b 

25 

30b 

Sears 

100 

Bb ' 

IZK 

14 

1 

3 

5 

no? ) 

110 

3b 

7 

6b 

5 

7b 

10 

Forte 

220 

15b 

222 

26 

4 

7 

12b 

rai i 

240 

5 

11 ' 

15b 

13b 

16b 

22b 

Tarmac 

120 

11 i 

10b 

19 

3 

6b 

9 

nan 

130 

6b ■ 

lib 

14 

7b 

11 

14 

Thom m 

1000 

33 5th 

rn* 

Kb 

35 

43H 

fTOIOl 

1050 

11 29b 

49 

45b 

63 

70b 

T5B 

220 

13b lBb 

25 

4 

lib 

14 

(-231 | 

240 

re 

a 

14 

15 

22b 

2SM 

Tom urn 

200 : 

20b 24 Vi 

30 

lb 

5b 

8b 

1*217 J 

220 

7 ’ 

ire 

18b 

ati 

14 

17 

Weacome 

650 

42b 62b 

77 

15b 

29 

43 

C672 1 

700 

18 

39 I 

52b 

40b 

54 

58b 

Option 


Jan 

AW 

JUI 

Jan 

Apr 

JH 

t3uo 

BOO 

45 

58 

72 

i7b 

33 

39b 

I*K1 1 

650 

20b 34b 

48b 

43b 

60 

66 

HSBC noft 

700 

64 69b 1 

33b 

19 

39 

52 

(*728 1 

750 : 

27b 

44 

59 

12b 

86 

70b 

Roden 

460 

33 44b 

53 

11 

ISb 

24b 

(*479 J 

500 

13 

25 33b 

31 

40 

45 

ODlion 


KW 

Fete 

Mar 

Nw 

Feb 

May 

Rofe-ROfte 

160 

15b 21b ; 

Mb 

b 

3b 

re 

(-173 | 

IK 

2 

!0 

14 


12 

17 


ssue Amt 
xtea paid 

P UP 

MM. 

cap 

f&n.) 

1904 

High Low Stock 

Ctose 

price 

P 

+/- 

Net 

dtv. 

Dtv. 

CUV. 

Grs 

jM 

P/E 

net 

_ 

FJ>. 

082 

0*7 

4 APIA Wmts. 

6 


- 

_ 

- 

_ 

- 

FP. 

17-6 

86 

70 Abtmtn Law Am 

88 


- 

- 

- 

- 

- 

FP. 

220 

63 

55 Do Warrants 

55 


- 

- 

- 

- 

- 

F.P. 

11.2 

187 

180 -JAdam Pmtg 

186 


CE8* 

ai 

1.4 

mg 

_ 

F.P. 

102 

76 

63 Artesian Ests. 

76 

+1 

- 

- 

- 

- 

100 

F.P. 

179 JJ 

93 

B5>2 BZW CommotSfes 

89 


- 

- 

- 

- 

- 

FP. 

16.4 

47 

39 Da Wris 

41 


- 

- 

- 

- 

- 

F.P. 

464 

02 

65 iOaUura 

86 

-1 

- 

- 

- 

- 

280 

FP. 

302 

287 

280 Churcho China 

285 


RMa.Bb 

22 

43 

13.0 

63 

FP 

12.1 

60 

65 Ennemn 

66 

-1 

RN0.71 

5.3 

7.4 

12 

- 

FP. 

KLQ 

155 

108 Rttrorac Cu* 

150 


RN0.7S 

2.6 

0£ 

50 S 

116 

FP. 

35.7 

126 

115 Games Worltahop 

115 

-2 

RN4.6 

Z2 

5.0 

10.9 

_ 

FP. 

1.91 

35 

23 Group Dv Cap Wta 

23 


- 

- 

- 

- 

- 

F.P. 

28.0 

62 

56 Hambroa Sm Asian 

56 

-1 

- 

- 

- 

- 

- 

F.P. 

270 

30 

37 Do Warrants 

27 


- 

- 

- 

- 

- 

FP. 

29A 

96 

90 INVESCO Korea C 

98 

td 

- 

- 

- 

- 

100 

FP. 

166.7 

223 

205 Irish Permanent 

219 

+1 

uN9.D 

29 

5J 

7.B 

- 

F.P. 

507 

493 

475 ProftUc Inc Art. 

483 

+1 

- 

- 

- 

- 

135 

FP. 

592 

149 

138 Servteatr 

145 


WO.9 

1J 

3J 

23.5 

115 

FP. 

2202 

125 

117 TGL 

124 


was 

20 

IS 

17.8 

170 

FP. 

20.0 

173 

1S0 Tole-Cine Cefl 

170 


RN5.44 

2J 

4.0 

IIP 


F.P. 

tun 

62 

57 Whllchiacti 

60 

-2 

RN1.25 

30 

20 

123 


RIGHTS OFFERS 

Issue Amount Latest 
price paid Ftenun. 1994 

p up (tele High Low Stock 


Closing Kv- 
prico 
P 


- uruertytog mox*i pnee. Piwntun* itetm are 
baaed on **Wem*ii paw. 

November 10 Toul c on naciK 24^18Cate: 9.703 
14JH5 


20 

NB 

9/12 

4 ] ?pm 

1 pm 

Butlers 


1 pm 


310 

Ml 

20/1 2 

41pm 

25pm 

Kmwood Appl 


26pm 


27 

fa 

28/11 

3'2pm 

2 l?pm 

Mantn lid 


3pm 


500 

Nl 

12712 

50pm 

Iflpm 

Matthew dart 


16pm 

-S 

26 

Mfi 

22/11 

Upm 

1 4pm 

Novo 


*4 pm 


5 

ra 

ISM 

2*ipm 

l 2pm 

■pUnen Square 


>2pm 

J 4 

FINANCIAL 

TIMES EQUITY INDICES 






Nov 10 

Nov 9 

Nov 8 

Nov 7 Nov 4 

Yr ago 

■High 

low 

Ordinary Share 

2384.1 

2376.6 

2348.5 

23465 2371.7 

23406 

271343 

2240.6 

Ont djv. y«ld 

4.34 

4.35 

4.40 

4.40 4.35 

3.96 

4.51 

3.43 

Earn. yld. 'b fuli 

629 

6.31 

039 

682 656 

4.62 

051 

3.82 

P/E ratio net 

18.38 

1 BJ1 

18.10 

1823 18.42} 

27.14 

3X43 

16.04 

P/E ratio nfl 

17.93 

17^6 

17.66 

17.7b 17.96 

25.16 

30JB0 

17.09 


'Fix igcu. Cnsnaiv STiov adm aktoe o omp ftu loiv hijfi 2713-6 2X0/04; Ina 48.4 28/8/40 
FT Ordnary 5 hare ibu bat* date 1 . 0 / 30 . TCmaacd valuta 


Ordinary Share hourly changes 

Open 8 J 0 iaOO 11 X 0 12 J 0 iaOO 14 J 0 1 SJ 0 ISM Ifitfi 


Low 


FT GO, ;j MINES INDEX 


2372.8 2371.6 2367.6 2309.5 2373.1 2372.0 2374.1 2380.0 2386J 23862 23B5.0 
Atoy 10 Nov 9 Alov fl Wot 7 Nov 4 Y t ago 

SEAQ bargains 24.490 26.796 22,075 21.786 23445 29,165 

Equty turnover Emit - 1S78.? 1072.1 1063.7 1083.9 1647.4 

Eqtaty tjarg^nsT - 20,198 24,013 24^22 ZTJBS3 3ZJ32B 

Shaw traded (rrtfjt - 613.1 657^ 398.8 466.0 610.5 

TEafedte Intre-mskM business and overseas turnover. 


am *cbg Mm 
8 on dm 8 


Yea Grass iftr S2 wtek 
ego juu% to* Lew 


-1 

-1 

GNd Mhea toden (34) 

■ Hagtonal Micet 

709955 

-06 

211253 211352 203208 

m 

2387 AO 176202 

-A 

Aincfl ns; 

3435.73 

-05 

344113 J49110 279599 

4.05 

371107 2304.« 


Audiausta i7t 

7718.85 

+26 

2649.92 2637.17 231284 

104 

301 3. BS 217156 

-1 

Nartn Amaica (U| 

161346 

-15 

1638.17 1616 65 1774.19 

083 

203955 1468.11 


Copyngni. Ths Fwtndol Times U"vted ISM . 

Fw»« in bract-els ab** nwrajer gf pprr pantos Basis LB Dcttar- Bom Vnteet 10X100 3 U12V2 . 
Pre-loc+siry facto Mbhw Indae Mm 1ft 257 5 : Ow's dvarvjo- ^0 ve» ago: 344.1 T Form 

Laipst pnees vrere uruntuUbte Mr ite edricn 



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36 


FINANCIAL TIMES FRIDAY 


CURRENCIES AND MONEY 


MARKETS REPORT 



Dollar firmer after surprise US inflation figures 


Hie dollar made further gains 
yesterday as good inflation fig- 
ures helped the currency build 
on improved sentiment, follow- 
ing Republican gains in mid- 
term congressional elections. 
unites Philip Gawith. 

The October producer price 
index fell by 0.5 per cent, 
against a market expectation 
of a 0.1 per cent increase. It 
was the first time in more than 
three years that producer infla- 
tion had fallen for two consec- 
utive months. 

The dollar closed in London 
at DM1.5348. a gain of a pfen- 
nig from before the PPI figures, 
and at Y98.04 from Y97.79 at 
Wednesday's close. 

The firmer tone in the US 
currency rame as an increas- 
ing number of analysts 
suggested that the DS currency 
may have turned, after a nine 
month fan 

Two dollar bloc currencies 
that profited from the firmer 
dollar, and favourable market 
perceptions of domestic mone- 
tary policy, were the Austra- 


lian and New Zealand dollars. 

Elsewhere, the Bundesbank 
council left official interest 
rates, and the repo rate, 
unchanged. 

Sterling continued to weaken 
against the firmer dollar, clos- 
ing at SI .5968 from S1.6036. 
Against the D-Mark, it finished 
at DM24506 from DM2.4534. 

■ With US markets closed 
today, traders are not expect- 
ing any sharp moves in the 
dollar ahead of the important 
Federal Open Markets Commit- 
tee meeting on Tuesday. 

There is increasing opti- 
mism, however, that a decisive 
increase in interest rates at the 
meeting could confirm an 
upward trend for the dollar. Mr 
Tim Stewart, currency strate- 
gist at Morgan Stanley, com- 

■ Pound In Nw York ' 


NOV ID 

— nea-e — 

-Rev. dose 

Espot 

1XD00 

1.6055 

1 nah 

16994 

1.6050 

3B» 

16889 

16045 

IF 

16916 

16974 


men ted; “Sentiment has defi- 
nitely turned over the past 
week. The Fed has an opportu- 
nity to put one more piece of 
the puzzle in place." 

“I don’t think positions have 
yet changed to match the 
change in sentiment, but the 
dollar is certainly vulnerable 
to good news," said Mr Stew- 
art. He said he would be much 
more confident if he believed 
the Fed would lift interest 
rates by more than 50 basis 
points. “If it raises by only 50 
basis points, the dollar will 
still be vulnerable to strong 
data." 

Mr Malcolm Barr, interna- 
tional economist at Chemical 
Bank in London, said: “The 
election result impacted on a 
market that had already gone 
too far. We think the dollar has 
bottomed. It will take some- 
thing fundamental for this 
market to reverse its direction 
and go to the downside again." 

He said the dollar should 
reach DM 1.57-1. 60 on a three 
month view. Chemical Bank is 


Germany 

Repo Rate (K) 
6.0 



4.5 1 


1994 


Source: FT Graphite 

expecting the Fed to raise 
interest rates by 150 basis 
points by the end of the first 
quarter of 1995. 

Mr Nick Parsons, treasury 
economist at CIBC in London, 
also said the first signs of a 
change in the dollar's trend 
had emerged. “The whole sen- 
timent seems to have changed 
from selling on rallies to buy- 
ing on dips.” 


Mr Parsons said a graph 
showing the difference 
between the S; D-Mark rate, and 
S/£ (cable), was a good proxy 
for dollar sentiment. From a 
high of nearly thirty units, in 
late Januap'. this gap had 
shrunk to minus fourteen units 
on October 25. Since then the 
trend has reversed, breaking 
through the trend line. He ven- 
tured that if the Fed were to 
intervene again now, support- 
ing rather than opposing the 
market “it could firmly and 
conclusively establish that the 
dollar has turned." 

■ UK cash interest rates soft- 
ened markedly following the 
large net injection of funds 
into the money market at the 
two-weekly gilt repo on 
Wednesday. One week money 
was offered at 5’i per cent, 
from just under 5\ per cent 
before the repo. One month 
money was offered at 5ft per 
cent, also down from 5 3 + per 
cent before the repo. 

Overnight money was also 


easy, as the Rqp k of RT *gfa T|f i 
cleared a small £250m shortage 
at established rates. It traded 
between 4 and 5Y. per cent. In 
recent weeks, daily shortages 
have often been above Slhn, 
with a high portion of liquidity 
provided in the form of late 
assistance. 

Mr Parsons said that up to 
one month out, lending rates 
were below the current base 
rate of 5Y, per cent. 

■ In Europe, the Swedish 
krona appreciated to SKr4.7GS 
against the D-Mark, from 
SKpLSI, buoyed by optimism 
about a yes vote in Sunday's 
referendum on joining the ED. 

The Italian lira was also 
firmer, at LX.024 against the 
D-Mark, from L1,QZ7. 


■ other cunsms 


K* TO 

ttBCay 

Iran 

KSKSl 

Mb M 

SkS 

UA£ 


173587 - 17*231 
7* 33 r t f . 230550 
04767 • 14777 
37*512 - 3JS1S 
*SS23- 437428 
USD - 58837 


1(3350 - 109JBQ 
17*830 • T7SUB 
0386 - 02991 
234650 -2SS0 
311200 - 31150) 
35715 - 16735 


POUND SPOT FORWARD AGAINST THE POUND 


DOLLAR SPOT ' FORWARD AGAI NFif ^.ErDpCLAR : 


Nov io 


Closing Change 
mid-paint on da/ 


Bld/dlter 

spread 


Day’s MM 
Hgh low 


One month Three months 
Rata %PA Rate KPA 


One year Bank of 
Rate MPA Eng. Index 


Nov 10 


Closing Change 
mw-potm an day 


Brt/offer 

spread 


Day's mid 
hgn low 


One month Three months One year JlP Morgan 
Rare WPA Rate WPA Rate %PA index 


(Sctl) 17.2649 +0X027 562 - 716 17.3050 17.2245 17-2606 

©ft) 50.4573 -0.0225 334 - 612 50J5S40 503430 50.4273 

95831 -a 032 800 - 862 96267 3.5770 

7.4704 -0.0567 612 - 795 7.5470 7.4570 

8. 4225 -0.011 199 - 250 S/4525 84070 

2.4506 -0.0028 498 - 614 2.4591 244E9 

+0.154 892 - 328 378.908 376.536 
+00018 184 - 187 1.0201 1.0161 


(DKij 
<FM) 

(FFtJ 
(DM) 

(DO 378.111 
(tq i.oigi 
ft) 2510.09 


(Ffl 2.7484 -0.0006 471 - 4S6 2.7578 17445 2. 7460 

(NKr) 10.7334 +00148 293- 374 10-8174 1043372 1 a 7334 

(Es) 248.740 -0815 661 - 819 252X73 249443 251.47 

(Pt3) 203.793 -0.7 713 - 873 204.814 203X54 204.123 


Europe 
Austria 
Belgium 
Demerit 
F in la nd 
France 

Germany 

Greece 
Ireland 
Italy 

Luxembourg 

Netherlands 
Norway 
Portugal 
Spain 
Sweden 
Switzerland 
UK 
Ecu 
SORT 
Americas 
Argentina 
Brazil 
Canada 

Mexico (New Peso) 

USA <S) 1.5968 -0.0068 965 - 970 

Padflc/Mkfcfle East/Africa 
Australia 
Hong Kong 
Mia 

(Y) 156.546 

(*53) 

(N2S1 


Europe 


9.5807 


8/4203 

2.4492 


1.0189 


24542 


(SFr) 

(q - - 

- 12875 -00024 868 - 882 


- 531 - 553 2.0618 2.0528 2-0511 


- 0920177 


(Peso) 

TO 

ICS) 


1.5059 -00058 SS5 - 982 
1.3341 +0.0023 331 - 351 

£1683 -00009 676 - 690 
5.4921 -0.0025 88 8 - 953 


1-2918 12857 12875 


1.6074 1.5935 
12390 1.3310 
21845 2.16-50 
55182 5.4685 
1.6088 1.5945 


83 

17X467 

84 

_ 

. 

1152 

Austria 

(Sch) 

108125 

+0.0*75 

100 - 150 

10.6175 

187385 

108125 

00 

10X123 

80 

10.7375 

87 

1045 

87 

50.3573 

0.8 

50X173 

06 

116.8 

Belgium 

(Sftj 

31.6000 

+0.12 

900 - 100 

31.6100 

3140*0 

31.6025 

-81 

3156 

85 

3146 

0.4 

106X 

83 

96954 

-06 

9675 

0.1 

117.1 

Denmark 

(DKr) 

6X016 

+0.0056 

006 - 026 

6.0H0 

5.9740 

6X056 

-OX 

6.0141 

-88 

6X526 

-OX 

105.4 


. 

- 

- 

- 

89X 

Finland 

(FM) 

4.6785 

-0.0156 

735 

835 

4.6962 

46619 

46792 

-XX 

4X76 

OX 

4X725 

81 

83.0 

03 

8.4126 

0.5 

8.3445 

0.9 

110X 

Franca 

(FBI 

52748 

+0.0155 

740 - 755 

5 2760 

5X430 

5X761 

-03 

5X737 

81 

5X615 

OX 

1C8X 

87 

2.4451 

OX 

2+4128 

16 

1263 

Germany 

(D) 

1.5348 

+0.0048 

345 

350 

1.5360 

1 5253 

1.5344 

83 

1.5323 

OX 

15195 

IX 

107X 


. 

- 

- 

- 

- 

Greece 

(09 

236600 

+1.1 

700 - 900 

237 000 

234.500 

237X7 

-1.4 

237.625 

-1.4 

239.875 

-IX 

684 

OX 

1X165 

OX 

1X204 

-81 

104.9 

Ireland 

m 

16670 

-0.0094 

662 - 677 

1 5811 

1.5660 

1.5669 

80 

15671 

ox 

1554 

88 

- 

-27 

2527X9 

-27 

267769 

-27 

74.3 

Italy 

(U 

1572.00 

+0.45 

100 - 300 

1573.25 

1567.00 

1576X5 

-32 

1534 

-3.1 

16245 

-83 

745 

87 

50.3573 

88 

502173 

06 

1166 

Luxembourg 

CLFri 

31.6000 

+812 

900 ' 

> 100 

31.6100 

31.4040 

31.6025 

-0.1 

3156 

05 

31.46 

84 

106X 

06 

2742B 

06 

2.7081 

16 

1288 

Motherlands 

(FI) 

1.7212 

+0.0068 

207 - 217 

1.7220 

1.7111 

1.7212 

0.0 

1.7193 

05 

1.7077 

OX 

105.7 

80 

10.7351 

-81 

18734 

00 

85.7 

Norway 

(NKr) 

6.7220 

+0.0377 

205 

235 

6 7627 

6.6*71 

6.7X47 

-05 

6.7375 

-89 

6.7695 

-87 

96X 

-83 

254.66 

-76 

- 

- 

- 

Portugal 

(ES) 

156.405 

+0.155 

380 - 430 

157X00 

165.610 

1S7X3 

-4.8 

158.155 

—15 

162555 

—4,0 

S5X 

-IX 

208.978 

-182 

207.403 

-1.8 

85.9 

Spain 

IPta) 

127.630 

+8105 

600 - 660 

127.700 

126X7D 

127X6 

-11 

128. ESS 

-3.1 

131X4 

-88 

888 

-20 

11.7469 

-21 

11.8914 

-16 

760 

Sweden 

(SKr) 

731B3 

-80377 

137 - 22B 

7.3727 

7X779 

7.3331 

-2.4 

73623 

-2.4 

75023 

-25 

888 

16 

20437 

2.1 

2.0014 

26 

1216 

Switzerland 

(SR) 

1X865 

+0.0055 

660 - 870 

1.2870 

1X782 

1X853 

IX 

1X812 

1.6 

1X623 

IX 

1075 

. 

- 

- 

. 

. 

684 

UK 

ra 

1 .5963 

-0X068 

965 ■ 

970 

1.6088 

1.59J5 

1X963 

0.4 

1 5957 

05 

1X885 

85 

89.1 

OX 

1X876 

OX 

1.282 

84 

- 

Ecu 


1X402 

-0.003 

397 - 407 

1X470 

1.2297 

1X387 

85 

1X296 

82 

1X392 

81 

- 


(AS) 2.1173 -05048 163 - 183 2.1336 2.1125 

(HKS) 123405 -04525 378 - 432 124330 123229 125315 

(Ha) 60.1919 -0.1917 760 - 057 S05690 50.1100 

-0266 457 - 634 157.180 158240 156096 
40898 -0:0137 883 - 912 

25709 -05041 684 - 733 

(Peso) 36.7212 +0.7972 353 - 071 3&8060 385400 

(SR) 5.9890 -05254 877 - 902 6.0338 5-9800 

22497 -0.0038 485 - 508 

55298 -0.0039 277 - 318 

65323 +0-0459 153 - 483 

-528 225 - 281 

(15) 41.6608 -0.1354 495 - 721 413704 413953 

(Bt) 39.8709 -01467 486 - 931 40.1400 392100 


Japan 
Malaysia 
New Zealand 
Philippines 
Sautfi Arabia 
Singapore 

S Africa (Com) (R) 

S Africa (Fin.) (R) 

South Korea (V/bnl 1272X3 
Taiwan 
Thailand 


(SS) 


4.1168 4.0818 
25940 25640 


23638 23450 
5.6634 5.6174 
63823 62050 
128205 127050 


2.1673 

06 

2.188 

84 

2.1848 

OX 

BBS 

15963 

0.4 

15857 

03 

15885 

05 

81.9 

2.1194 

-IX 

2.1221 

-OX 

2.136 

-0.9 

_ 

12X315 

ox 

1X3272 

0.4 

12X82 

85 

- 

156X96 

3.4 

155X81 

3.7 

148958 

42 

189.9 

25756 

-2X 

25848 

-2X 

25047 

-15 

- 

- 

- 

- 

- 

• 

- 

- 


Sort - 1.47532 

Americas 

Argentina (Peso) 0.9995 

Brazil (RD 08355 

Canada (CS) 1.3580 

Mexico (New Peso) 3.4395 

USA (3) 

Padfle/Mkkfle Eeat/AMca 


+0.0006 994 - 995 0.9995 0 9990 - - - 

+0.005 350 - 360 0.8360 0 8310 - - - 

♦0.0053 577 - 582 13560 10557 1-3577 03 1X574 02 5263 -04 

+0.013 380 - 410 3.4440 3.4350 3.4405 -OS 3.4423 -03 3.4497 -03 


B3X 


95,0 


AustraBa 

(AS) 

1X260 

+80026 

2SG - 264 

1.3275 

1X238 

1X262 

-XX 

132E3 

-03 

12343 

-88 

B8X 

Hong Kong 

(HKS) 

7.7285 

- 

260 - 290 

77X90 

7.7380 

7.7266 

0.3 

7.7361 

0.1 

7.734 

-81 

- 

tnr&a 

<Rs) 

31.4338 

+0X136 

300 ‘ 

■ 375 

31.4500 31.4225 

315188 

-32 

31.E638 

-2.9 

- 

- 

— 

Japan 

01 

98X400 

+825 

000 - BOO 

98-7000 97.6200 

97.79 

11 

97.19 

35 

94.425 

37 

1505 

Malaysia 

(MS) 

25813 

+0.0023 

608 ‘ 

■ 618 

£5625 

25575 

25521 

42 

25*C8 

2X 

2.6143 

-2.1 

- 

New Zaatand 

iNZS) 

1.6101 

+80043 

088 - 113 

1.6142 

1.6005 

1.6111 

-0.7 

1.6129 

-87 

15162 

-86 

- 

Ptutppines 

IPeso) 

24X500 

+0.8 

0G0 

000 

24 3000 24 0000 

- 

- 

- 

- 

- 

- 

- 

SautS Arabia 

(SR) 

3.7507 

- 

505 - 509 

3.7510 

3.7505 

3.752 

-0.4 

3.7561 

-86 

3.77*7 

-05 

- 

Singapore 

(SS) 

1.4715 

+0.0036 

710 - 720 

1.4730 

1.4667 

1.4692 

1.9 

1.4644 

IX 

1.4J7 

1.7 

- 

S Africa (ComJ 

(R) 

35256 

+80125 

250 - 265 

35270 

15125 

35404 

-5X 

3572 

-52 

3.7311 

-5.8 

- 

S Africa (FinJ 

CFO 

4.0910 

+0.046 

810 - 010 

4.1010 

4.0550 

4.1138 

—6.6 

4.161 

-65 

4296 

-75 

- 

South Korea 

(Won) 

796.950 

+0.1 

900 - 000 

797X00 796.800 

799 95 

-45 

803.45 

-32 

821X5 

-31 

- 

Taiwan 

rro 

26X910 

+0.0282 

880 - 940 

280950 280860 

28111 

-ax 

26.151 

-OX 

- 

- 

- 

Thailand 

(Bt) 

24X700 

+8019 

600 - 800 

24.9SC0 34.8500 

25X425 

-35 

25.17 

-82 


-2.7 

- 


tSOR rata ler NovB. Bkffarter spreads In ine Pevid Opel tads Shaw oedy the lan throe decimal ptacei Forward raroa ora doc (badly quoted to 9w market 
but era knplM by cuiwa mraxitws& Swung Indn cdaAnd by ttw Bonk al Enghnd. Base overage 1995 - 100.Bd, Offer end Md+Stes In UMh Mart 
the Dde Spot tales derived tan THE WMJnSSIERS CU3SMQ SPOT HATES: Sum Wuea era rounded by Mr F.T. 


CROSS RATES AND DERIVATIVES 


TSDH ran lor Nova BdTOffar ipraTOa m me Dcfler Spot table dun* orty the tor Mi 
but are impfeed byaaranihtenaitaes. UK. Wand 4 ECU m wared nUSomncy. 


M deemai places. Forward raroa are not dnedy quoted to the marW 
JJ*. isogci nonntf -ideas Ncv 9. Bose average 1930=100 


WORLD INTER EST RATES 


money rates 

Hoveo*WiO Owr 

ngnt 


One 

month 


Three 

rafts 


Six 

rafts 


Cm unit 

year lifts. 




Belgium 
week ago 


week ago 
Germany 


Ireland 
weak ago 

week ago 
Netherlands 
week ago 
awl Ui ertrad 
week ago 
US 

week ago 
Japan 


4% 

<3 

Sft 

5fe 

4% 

4« 

5S 

5ft 

5ft 

5ft 

SH 

S3 

5ft 

5ft 

544 

SB 

4X0 

4X6 

5.15 

5X5 

453 

4X5 

5.15 

5X5 

6ft 

6K 

5% 

6ft 

Sft 

S» 

6H 

Sft 

Sft 

81k. 

SB 

9 

8U 

SS 

SS 

9H 

454 

505 

6X4 

6X8 

454 

5X5 

5X4 

5X6 

3* 

Sft 

.4 

45i 

33 

SB 

4ft 

4W 

4ft 

6M 

5K 

Sft 

48 

5» 

53 

S3 

2K 

2TA 

Sft 


2Vi 

2S 

2ft 

2ft 


.6ft- 7.45 

6ft 7.40 

W/SLCD 
Bt sxo 
6j 60 am 
6X0 8 in 
7ft ' - 

?t . - 

•' « :• ; . 
10* 

5t76 - 

STB 

4» ft 625 
4H .6626 
6| 

6ft - .- 
2* 

.2* 


-. .w. 


1^ 

.*'4 j* i 

* s - 


111 

J £ 


TJSO .*26 
.MB .AS6. 
528 . - 

526 " -- 
ABO'*' ±. J 

la-.+'-.i’ 

' ~7~ : 
Aflo ■■..•■•>••• 
,136 ■ -i- . 

US 


m 




m S LIBOR FT London 



5K 
5* 

- SIS 

- SIB 

34t 

m 


68 

Ht 

S6D 

539 

34 

38 


Bte 

64 

S68 

STB 

3* 

3* 


6W 

6* 

8X0 

0.45 

it 

4 


ra iktad Da ■** wees 1 mtfc BSj 3 new B» 6 rotta Biiyeac WkS UBORtaM*^ 

M.nidnd mi*e fw Siam quteed to the maria* ojr fata ndkanca ta*a at name— 

SSs 01 Tofcyo. Bwda>e td Nrtoml ww nawt-. 

S donwfc Money free*. US S COe md SCR U*ad Ofteaft «SV 


EURO CURRENCY INTEREST RATES 

Nov 10 Short 7 days One Buy 

terra notice month »i«JIi» 


»r 



43 

-4JJ 

43 

-4« 

5- 

4% 

5^* 

5*1 

5ft 

fift 

■Bft-rJiL".'- • - a 

Dartsh Krona 

5*2 
5 - 

-su 

4^| 

A 

5- 

■5*2 

Ok 

S*a 

43 

54 

6% 

Eft 

-ek 

-5ft 

-7 - 
5*4 

ft 

ft 

ft 

ft 

§ 


5 - 

4% 

5,'+ 

-4ft 

5ft 

-6 

5*4 

6ft 

6% 

5k 

ft- 

ft 7- . . 


5V 

5^* 

5,: 

■5ft 

5ft 

5ft 

6V 

-t* 

54 

ft. 




&A 

Bk 

8*j 

9** 

-9 

10- 


10*4 

-IB- 

«*a 

W| 



7A 

Th 

■th 

7H 

7*2 

7ft 

Erl 

ft 

ft 

: ft 


Sterfng 


■4h 

3,1 

Sh 

3ft 

■4% 

Sft 

5ft 

3S 

8 

Sft 

4 - 

rj 

BA 

ft 

Bft 

— 4+. 

■ ra- 
ft- 

’A 


5i* 


Sft 

4'M 

5ft 

bft 

5* 

6*2 

6*4 

ft 

ft 

-r ■ : . , 



4 h 

5& 

Sft 

5ft 

Sri 

5ft 

■5ft 

ft 

-8 

ft- 

ft. •. •, 


9 - 

7*2 

B% 

6*4 

8*4 

6** 

Sft 

Sft 

9- 

ft 



zA 

2h 

2ft 

2U 

2ft 

2*4 

2H 

2ft 

212' 

2« 

2S+ 

*.+ ■• . 

Asian SStog 

ih 

2\ 

3ft 

2B 

3*4 

3*fl 

3*2 

3% 

34* 

ft 

ft 

-5v . •: : 


‘ • ^ :? 

13 

3 t 

m 

. . . v ■*- 

! t,1C 
i 

-m 


3 > - - 


i era cal tar Mi US CWM and Yen. omera two daW rariee. 

i mtertmft offered raft 



Open 

Sett price 

Change 

rtgh 

Low 

Eat Wf 

QpmtaL 


94X8 

94X7 

_ 

94X8 

94X5 

18143 

48X19 

Mar 

93X2 

93X4 

+801 

93X8 

93X1 

9X34 

. 37X31 


9340 

9344 

+0X2 

93.46 

9340 

6X33 

30AH; 

Sep 

93X6 

9311 

+803 

8312 

83X6 

3X37 

20X34 

■ THRIB MOffTTI BLBK»OLLAR(UFF^* *1m points of 100H 




Open 

SMI price 

Change 

High 

Low 

EsC voi 

Open tot 

Doc 


94X0 

+805 

- 

- 

0 ‘ 

: .2486 

Mar 

. 

93X1 

+0.04 

- 

- 

0 

1388 


. 

9304 

+806 

- 

- 

0 

354 

Sep 

- 

8387 

+806 

- 

- 

■ 0 

-.Bt 

M THRBK 

MONTH HJROaUHK NIIMI (LFFEJ* DMIm paMa of 1Q09C 



Open 

Sett price 

Change 

High 

LOW - 

EsLvol 

Open ML 

Dec 

94.84 

94.64 

- 

94X5 

94X2 

22689 

14477B 


94X7 

94.63 

+806 

94X4 

94X6 

52850 

167638 - 


94X2 

94X9 

+800 

94X2 

94X1 

35B91 

114697 

Sep 

9384 

83X0 

+805 

93X2 

93X3 

15459 

79648 

■ TURK 

MONTH EUROUHA BNTTJRATK FUTUMES (UFFE) LI 000m pctatBoMOOK 


Open 

Sett price 

Change 

rtj* 

Low 

BtL voi 

OpanbiL 

Dec 

91.12 

91X2 

+0X8 

91X3 

91.12 

5808 

33800 

Mar 

9848 

90X2 

+811 

90X3 

9847 

5132 

33305 


69X6 

90X6 

+812 

90X9 

89X1 

1623 

18145 ■ 

Sap 

89.52 

89.82 

+813 

88.63 

8848 

737 

21285 

■ riffin MONTH KURD MRS 

B HUUNC Mim (LUTE) SFrim pointe of 100* 


Open 

Sett price 

Change 

Htfl 

LOW 

Eat voi 

Open HL 

Dee 

85X4 

05X8 

+0X3 

95X7 

95X3 

172Z 

-19807 : 

Mar 

95.68 

95.71 

+805 

95.72 

95.68 

3543 

19788 

Jun 

B5.33 

8537 

+806 

95X8 

96X2 

520 

4888 

Sep 

94X8 

85.02 

+806 

95X4 

94X0 

405 

2141 , 

■ THREE 

j 

l 

3 

! 

a 

i 



Open 

Sett price 

Change 

High 

Low 

Est voi 

Open int 

Dec 

8397 

9399 

+0X2 

93X9 

93X5 

1517 

8717 

Mar 

93X5 

93X2 

+807 

9365 

B3XS 

1618 

7*33 

Jun 

3308 

9312 

+806 

9315 

9306 

423 

4149 

Sep 

92X7 

92X3 

+806 

92X6 

82X7 

487 

2484 


- LBTE Inures traded on APT 


EXCHANGE CROSS RATES 

Nov 10 BFr DKr RV 

DM 

E 

L 

n 

NKr 

Ee 

Pte 

• SKr 

SFr 

£ 

CS 

s 

Y 

Ecu 

Belgium 

(BFr) 

100 

18X9 

16.69 

4X57 

2X19 

4974 

5.446 

21X6 

494X 

403.9 

2217 

4X71 

1X82 

4X96 

2165 

3103 

2553 

Danmark 

(DKr) 

52.66 

10 

0790 

2.658 

1.063 

2619 

2X88 

11X0 

260.8 

2127 

12X0 

2143 

1.044 

2X62 

1.666 

1624 

1X44 

Ranee 

(FFr) 

59X1 

11X8 

10 

2X10 

1X10 

2980 

3X62 

1274 

2905 

2420 

1288 

2439 

1.187 

2574 

1.896 

185.0 

1X29 

Germany 

(DM) 

20X9 

3X10 

3.437 

1 

0416 

1024 

1.121 

4X78 

101X 

8216 

4.769 

OB38 

0408 

0885 

0X52 

63.80 

0.525 

Ireland 

m 

49.52 

9.404 

0268 

2X05 

1 

2463 

2697 

1053 

245X 

2000 

11.47 

2016 

0X81 

2128 

1X67 

1527 

1X64 

Holy 

(L) 

2.010 

0X82 

0X38 

0X98 

0041 

100. 

0109 

0.427 

9X48 

2120 

0488 

0062 

0.040 

0086 

0084 

6X39 

0.051 

Netherlands 

(FI) 

1BX8 

3.487 

3X65 

0892 

0371 

913.4 

1 

3X05 

90X7 

74.16 

4X54 

0747 

0X64 

0789 

0X81 

56X9 

0.469 

Norway 

(NKr) 

47.03 

8X31 

7X50 

2284 

0950 

2339 

2X61 

10 

2327 

189X 

10X9 

1.914 

0932 

2021 

1.488 

145X 

1X00 

Portugal 

(Es) 

2021 

0838 

0X73 

0902 

0.408 

1005 

1.101 

4X97 

100. 

81.82 

4.682 

0X23 

0400 

0868 

0640 

6272 

0516 

Spate 

(Hta) 

24.76 

4.702 

4.133 

1X03 

0500 

1232 

1.348 

5X85 

1226 

100. 

5.736 

1.008 

0491 

1.064 

0784 

76X4 

0.632 

Sweeten 

(SKr) 

43.17 

0198 

7X05 

2X97 

0X72 

2147 

22S1 

9.179 

213.6 

174.3 

10 

1.757 

0855 

1X55 

1X08 

134X 

1.102 

Switzerland 

(SFr) 

24X7 

4X68 

4.101 

1.193 

0496 

1222 

1X38 

5X24 

121X 

99X2 

5.691 

1 

0487 

1.056 

0.778 

78X4 

0.627 

UK 

ra 

6046 

9X83 

0423 

2451 

1X19 

2510 

2748 

1073 

249.7 

2028 

11.60 

2.064 

1 

2168 

1X97 

156.8 

1XS8 

Canada 

(US) 

23X7 

4.420 

3X85 

1.131 

0470 

1168 

1X68 

4X49 

115X 

94X0 

5.392 

0X47 

0461 

1 

0737 

7223 

0X94 

US 

(S» 

31X0 

8X01 

5X74 

1X35 

0.638 

1572 

1.721 

0719 

1504 

127X 

7X20 

1X88 

OBJB 

1.358 

1 

96.06 

0807 

Japan 

ff) 

3j>.j»3 

6.119 

5X79 

1X65 

0.651 

1803 

1.755 

6X52 

169X 

1301 

7.465 

1X12 

0638 

1X84 

1.020 

100- 

0822 

Ecu 


39.18 

7/140 

0540 

1X03 

0791 

1949 

2134 

8X31 

1933 

168X 

0X78 

1X95 

0778 

1.883 

1X40 

121.6 

1 

Donhti Manor. French Rang. No>e0ei itaiw. and Mndtah Kronor par 10; BWgtan Rwic, Yon. Erado, Ura rod Pnb par 100- 








■ D-MARK RITURES (MM) DM 126X00 par DM 





■ JAPAMK3B YEN FUTURES (IMM) Yen 12X par Yen 100 






Oprm 

Latest 

Change 

rtgh 

Low 

Est voi 

Open bit 

Dec 

06550 

08538 

-00006 

nffBR 

06536 

51,482 

88X36 

Me 

0.6655 

0.6660 

-0X006 

08570 

06660 

892 

8.138 

Jun 

" 

0X682 

“ 

06682 

' 

1 

1X57 

M SMB 

IS FRAMC FUTURES (IMM) SFr 125X00 per SFr 



Dec 

07806 

07802 

-00006 

07836 

07785 

29.151 

41X48 

Mar 

07843 

07835 

-00012 

07067 

0.7831 

486 

2243 

Jun 

07800 

0.7900 

" 

07903 

0.7900 

3 

185 

IvUK 

INTEREST BATES 





LONDON MONEY RATES 





Nov 10 


Over- 

7 days 

One 

Throe 

Sto 

One 



right 

nofce 

month 

months 

months 

year 


Dec 

Mar 

Jun 


Open Latest Change 

1.0258 1.0262 +0.0012 

13357 1X)345 +00009 

1X442 


high 

1X278 

1.0362 


Low 

1X255 

1X346 


Est voi Open btL 
27,405 87357 

364 8377 

3 715 



MEMBER SEA 


Margined Foreign Exchange 
Trading 

Fast Competitive Quotes 24 Hours 
Tel: 071-815 0400 or Fax 071-329 3919 


[INVESTORS - TRADERS - CORPORATE TREASURERS 
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LONDON ■♦•71 329 3377 

LONDON +71 32S 3377 NEW YORK +2X2 20M6M FRANKFURT +49® 446971 


FUTURES 

&0PTI0NS 

TRADERS 

KMANKFnrtENT 
a rnwiniTiVE sebvvt! 

^,1 

Berkeley futures UmiteI ? i 

38 DOVER STREET, LONDON WIX 3RB 
TEL: 0171 629 1133 FAX: 0171 495 0022 

1 


■ STERLING FUTURES 0MM) 8B230O per E 


Interbank Storing 5^-4 5* - 5 SS - 5,1 Oft - 60 6ft - 8^ 7^ - 71* 

Starting COB - 5B-SJJ 6-5* 6ft - 6ft 7*4 - 71 b 

Daesuy BKa - - Rft - 5ft 50 - 

BerBBBs - - 6ft -5ft 50 -5H Oft - Oft 

Local authority depa. 6ft - 40 6ft - 5ft Sft - 5ft 50-50 6% - 8>e 7ft -7ft 

Dtocount Marks! daps 6 - 4*2 5ft - 40 

UK daering bank base lending rate M* per cent from Septente 12, 1884 

Up to 1 1-3 3-6 64 8-12 

mams 


Cvts of Tex dap. (2100X00) 1 >2 4 3^ 3^ 3^ 

Carta of Tncbp. wder El 00X00 b 1>jpa DapMlts vriMfaaan lor cash Itpc. 

Ana. Wider Ota M dboount U342oa B3QO tad pan flap. Bqxst fhenca. Mdw up dn Oct 31. 
199*. Agned raw tor parted Nov 28, 1B04 to Dao 25. 19M, SohaniH B & ■ 7JSpc.Rahrara* taw lor 
pariod Oot 1, 1B9* to Oct 31. 199*. Sdwnaa WAV SJOBpc. Rnwnoa Kouaa Bam Ru 6pe tan Nov 
1,1994 

gJFFg £500X00 pOjnjg Of 10094 



Open 

Sett price 

Change 

Htfi 

Low 

Eat wl 

Open Int 

Dec 

9257 

6261 

+001 

93X4 

83X6 

16738 

142248 

Mar 

9277 

9281 

+0.01 

B2X4 

9274 

21017 

78014 

Jun 

8218 

OO 79 

+0.01 

8226 

9215 

7252 

58471 

Sep 

91.77 

91X1 

+001 

91X4 

91.73 

3154 

58798 


IVadad on APT. AM Open knraat flgs. n far proriou My. 


■ SHORT « T BnUB O CRMlOWa (UFFE) sa00,000 polnta of IPO* 


Strike 

Price 

Dec 

— GALLS - 
Mar 

Jun 

Dec 

— PUTS - 
Mar 

Jun 

9380 

0.18 

006 

0X8 

0X8 

0.75 

1X4 

8375 

0.06 

0.02 

003 

0X0 

0X6 

1X6 

9400 

0.01 

0 

0X2 

040 

1.10 

1X0 


Eac. net. total. Cate 8263 Pun 6102 tatara dayb epan hu Cate 3*8052 pub zwsbS 


Dec 

1.6054 1.8028 +0X004 1X080 

1X020 

18X00 

50,003 

Mar 

1.6050 1.6010 

1X080 

1.6002 

232 

714 

Jui 

1X000 

1X020 

- 

2 

17 

EMS EUROPEAN CURRENCY UNIT RATES 



Nov 10 

Ecu can. 

Rate 

Change 

H +7- Irani 

N spread 

Otv. 


rates 

against Ecu 

on diy 

cm rate 

v weakest 

md. 

we -»■ - a ■ 

rtoiiRVoncD 

219672 

214711 

+0X0088 

-228 

5.69 


Belgium 

40X123 

39-4030 

-0-0134 

-201 

5-42 

15 

Germany 

1X4964 

1X1443 

+0X0041 

-1X1 

5X0 

. 

Ireland 

0X08628 

0.784511 

+0.001323 

-1.75 

5.14 

12 

France 

6X3883 

8X8045 

-0X0094 

0.64 

266 

-6 

Denmark 

7.43879 

74B488 

-a 00721 

a78 

260 

-5 

Portugal 

192854 

195X68 

-0X9 

1X5 

2X2 

-8 

Spate 

154X50 

159X43 

-ans 

3X0 

0.00 

-23 

NON EHM MEMBERS 






Greece 

284X13 

294X81 

+0X27 

11X2 

-7X7 

- 

Italy 

1793.10 

1968.65 

-029 

0-67 

-5X1 

_ 

UK 

0.788749 

0.780472 

+0.000042 

-a bo 

4.13 

- 


Ecu oansal Mas aat by te Eurapenn CorattatoOn. Cvoranolss era In dmcandns nlatHn Btaiglh. 
Paamtega changaa m for Eew a podlhe dwnga daw a arnfc ewraney. DlvwgtnM ttiOM the 
mOt> batwam tno «nadr Mr parotaaga (Hbranra tanaat tm octal roarta and Eat cental iMaa 
ter a ewraney. and the maximum peraWtsd paroantaga deviation of #» ammafa meiihet rate tan m 
Eai oartrd rota. 

(17/9192) Storing and Italan Ura aropandad tan BU tefuMmta cakaiated by Oia Flnandal Ttmaa 


■ PtMLADELPWA 8E £/$ OPTTOMS £31 350 (cents per pound) 


Strike 

Price 

Now 

- GAILS - 
Dec 

Jan 

Nov 

— PUTS — 
Dec 

Jon 

1-550 

fi-JB 

6.48 

5X7 

_ 

023 

0.84 

1X78 

278 

3X5 

4X4 

. 

068 

1X8 

1X00 

0X7 

1X1 

2X5 

018 

1X7 

227 

1X25 

0.01 

0X9 

1X4 

204 

3X0 

3.84 

1X80 

- 

0X5 

0X4 

4X7 

4X3 

5.41 

1X75 

- 

0.10 

041 

6X7 

7.17 

7A8 


Pmfoua datre woL Cda 83B1 Puta 180*0 . tea da/a span hu Cate *32.789 Putt *32X27 


■ THRM BMETH RmODOlLAH Sim porta of 10096 



Open 

Latest 

Change 

Wflh 

Low 

Eat voi 

Open Int 

Dec 

93X4 

94X0 

+008 

94.01 

93X1 

70,183 

411,120 

Mar 

93X8 

83X2 

+006 

93X3 

8243 

121X44 

417.116 

Jun 

9297 

93X3 

+0X6 

00X5 

no ag 

60X87 

304,061 


BASE LENDING RATES 

% % j - 

Adam & Company — &7S DuncanLatrie — 6.75 *Rcsitxrste6imritM 

ABsd TiuBt Bonk 5.75 EartarBankUmted— 8J5 COpoadtan Lhflad B no 

AIBBank 5.75 RnandelSGen Bank- 83 longer adhoriaed as 

•Henry Anabachar 5.75 •RobsrtHerrihg&Oo-BJB a banUng tatedon. 8 

Benk of Benda — 8.75 Gkabm* 6.75 Royal Bk of ScoSaraJ- 5.75 

Banco B*iao Vtnaye— 5 l75 •QuMmsb Mriton SJS «6rr«i A Wtertan Seca . 5.75 

Bor* Cyprus 575 HBttbBsttAGarth .675 TSB 575 

BankofMand 5.75 •HantnwBank 0.73 •UrBedBkofKuwat _ 5.75 

Bar* of Mat -575 HorSaUe & Gan Irw Bk. 5.75 Urt^rThjat Bank Pk: 6.75 

Benk of SeaBand -...-.8.75 teHiSvnud. 876 Western Dnat — 875 

BerdayeBank 875 CHoara&Oo 875 WMeanwLsidtow — 875 

MBkafMUEaei — 875 Hcngkroig&ShroigheL 875 YertaMraBerte 875 

•BronSfBteyS COLIC .5.75 Juien Hodge Berk .... 875 
CLBankNedartand ... 878 H^apaU Joseph & Sons 575 •Marten of London 

CBtenkNA 375 UoydaBank — 875 tnveefenent BarMtg 

OyteadeteBank -.675 Me(Cn4 Bert Ifet 875 AsaodHort 

ThaCooperaBn Bank. 875 MUandBenk 875 • in BdnMetatan 

CautteftCO— -875 *MaurCBHr*frig 6 

CradtLycreiata 875 NafWteMnater 875 

Cyprus Popular Bark ~fi.75 •RaaBraVtera- -..876 


■ U8 THEABUWY BILL WITUREB (IMM) Elm per 100% 


Doc 

94X3 

94X8 

+005 

84X8 

84X2 

677 

17X78 

Mar 

94X3 

94X7 

+006 

94.03 

94X1 

133 

1O052 

Jut 

- 

93X0 

- 


83X2 

18 

5X37 


M Open tenet flg*. era far pw/taue day 

(UFFE) DMIm pointe of 100H 


Strike 

Price 

0476 

8000 


CALLS 


PUTS 


Nov 

Dec 

Jan 

Mar 

Nov 

Deo 

Jan 

Mar 

O10 

012 

008 

013 

0X1 

003 

020 

025 

0X1 

0X2 

0X3 

005 

017 

018 

040 

042 

0 

0 

0X1 

002 

041 

041 

083 

0X4 


total, Cate eeao n*a 03*8. PravtaMdaVs omn me. Csea 221m Puw ibb+to 
SWW nunc OPnOHB (UFE) SFr 1m pointe Of 10096 


Strike 

Price 

Dec 

- CALLS - 
Mar 

Jui 

Dec 

PUTS 

Mar 

8578 

030 

018 

Oil 

0X9 

020 

9800 

004 

0X8 

005 

008 

036 

0828 

0X1 

0X2 

002 

0X0 

0X6 

EtLfor. toofc 

era* SO Puis 90. Pnvtaua deya open Int, CM* saie 

Pin 1699 


Jun 

048 

868 

880 


LIVE FROM LIFFE - 0839 35-35-70 

Dial now and hear the Fooole move with Eve co mm en ta ry tram Ufle.es It happen*. 
For details of ail UUfcr Uses end oor Buuxtel latonaadoa services, cafl 071 -695 9400. 
CaBs are charged at 38p/mtn cheap rate. 49|Vlnte aO oilier tfanea. 

Future* Pager Ltd. IS/21 Greet Tower St London EC3R5AQ. 

Futures Call 



TAX-FREE SPECULATION 
rx FUTURES 


Toobcdo year taCudrro howyaar RmbcU Boakaate aa bdp 
jmcdHidnd Mariy or bnjeofam an 071-8287233 arwree 
ID BE IE Index Re. W I GnMnarGaedcn. London SW1W (BD. 



^ Market- Eye 



HSBC Global bneatmeuf Fmtda 
Sodftf d Turt i llwiaaettf 5 capital urittit 
7 ruedn Marcte-anx-GTerbes 
L-1728 Laxentboars 
R.C Lmcmlmarg B3SX37 

Notice is hereby given to ahaieholdea, that the 

ANNUAL GENERAL MEETING 

ofsiiardioMeniaHSBCGtebal inyest m ent Fund* wfl] bejhald at the company's reg- 
istertd office at 7 me da Marcte-aox-Hetbcs, L-1726 Luxembourg, on Friday 25th 
November at 11X0 am for the pmpose of oonaideiiiic the onfinary business of the cotu- 
pany aad voting upon the (oHowing agenda: 

L S nhoin i pon of the report* erf the Board (rfpfaodoai and Ihc Indcpemic ia Acditoa. 
2. Approval of the Hnancial Stetements for the period ended 31(1 July 1994 and 
the appropriation of the nctresalB. 

3- Discharge of [he Dbectefa. 

4. H«-eMrrinnwf rtig niw-rtnr« Mid n p pninrmwU nf the IwV^mU., Andtei 

5. MhceUmwa. 

Tbc shareholders uc advised that no quorum is ntquired Cor the items oo the agnda of 
the Annual General Meeting aad that dedakwa win be taken on i simple majority of 
the stares present or represented at the meeting. 

In drier id attend the meeting of 25th November 1 994. the ownen of bearer shares wiU 
have Id deposit their shares five dear days before the meeting at te registered office of 
the Company or whh one of the following bankK- 

Raaqnc Inte rnati o n al e i f a ntratlK t uq ; 

2 Boulevard Royal 
L29S3 Luxembourg 

HMgkMg & Shanghai Baafcfeg Corporaiion 
1 Queen's Road Central 
Hang Kong. 

By order of the Board of Directors 


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Proles, sionjl lin.mci.Tl inlornution direct 
to veur PC lor a low fixed co'.t. 

FREEPHONE 0800 321 321 


Currency or Bond Fax - FREE 2 week trial 

also daily gold and silver faxes 

Iram Chat Analysis Ltd 

Oik Anne Whitby 

7 S.vjI.'ow Slroct. London W1R 7HD. UK ■ 

Tel: 0I71-73J 7174 

erenonge rate specialists lor over 70 yeers 
votvioied !M: Pe:«er: ■."•vmito-; Avinc W 

Fax: 0171-439 4966 


.▼▼V. 




24 IIOLR 

"ore i on. rxc Hanoi 

1 1.> n J o ti 
P..MLIIV2 n, <.k 


CURRENCY MANAG5MKMT 
CORPORATION PLC 
1 1 Old Jco+ry 
London EQR 8DU 
Teh 071463 0800 
FkC 071-472 0770 


I R i N I) 


•FOREX ’METALS ‘BONDS -SOFTS 

Objective analysis for professional investors 

0962 879764 , 

Fiennes House. 32 Sout^ate Street, Winchester. ( 

, Hants SO 23 SEri Fax 0424 774067 : 


DO YOU WANT TO KNOW A SECRET? 

The m s. Gam Samtear eiiow ytu how ttwmariets REALLY work. The amazing 1 
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B a nk Limited 1 
A.C.N.0S5513070 

U^. $100,000,000 

Floating Rate Notes due 1998 

Niitice « hewby given rhai for rhe [merest Period 10th November, 
i ^95 die Ncices wiff carry a Rare of Inrerew of | 

f^^nnura. The Interest Amounts payable will be U.S. 
51c0.04per U.S. S10.000 Note and U.S. $1,600.42 U.S. $100,000 
Note. The Interest Payment Dare trill be lOrh February. 1995. 


Bankers Trust 
Company, London 


Agent Bank 


AS|POlNTMEKF9AOVRaTtf3N6 
appttirittMOKat&w ; 

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■ v. ! ...i jto & t w 8k i ntf*AAan 1'7. ' 



Sovereign (Forex) lid. 

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Laadon SW1X8HL 

T*fc +71 2*50080 

Roc +71 2950689 










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spauo mu 

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050 -660 I 

750 -20 1.191 700 — 

035 —16 1.023 615 1.1 

BASF 314.60 -46034380 276 15 
BdfUMfc 400 +1.80 610 435 IB 
BnkDM 300 +150 485 34150 15 
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BBgWV 48200 -160 575 396 19 

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875 +41^0 642 *B - HffiN 

790 -20 803 430 — — ■ MB 

1790 —1033 1 030 — IfeBaR 

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1090 +10 1,410 1020 10 

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645 -14 803 490 _ 

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Z MtsubiaN Huy 

— Nippon Steel ... 
” Kawasald Steel — — 

Nichldo F&M Ins 

— Sumitomo Mtl 


Stacks 

Closing 

Changa 

Traded 

Prions 

on day 

8.0m 

745 

-7 

60m 

381 

-a 

B.3m 

42B 

-a 

5.2m 

634 

-ii 

4.9m 

342 

+2 


NKK 

NonwraSecs 

Toshiba 

Toray Mb .._ 
Hitadii . 


Stocks 

Closing 

Changs 

Traded 

Prices 

on day 

3.7m 

277 

-3 

3.6m 

1880 

-70 

3.4m 

722 

+3 

2.7m 

758 

+5 

20m 

964 

+1 


xs 


Any time any place 
any share... 

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anywhere in the world 


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19710 18BZB 1S87-3 !**» 30 
10152 1027 2 10ZLO MW SC 

38725 38921 S8534 «X» 2ffl 
103422 104143 102841 112205 1C 

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M 68337 55640 887X29 18M0 

yuuto 337.18 41878 2/2 

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1293,15 128128 1277-12 M 

194826 194328 19212* 23KUS 2/2 

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122788 25/ID 
182142 25/10 

MUM WO 
211X38 5/10 
188X58 7/10 

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4/5 

5/1 

44X72 12/7 

1884.14 1/7 


I Bk 84(31/12/55) 
Ga*nl(1ttB7] 


Ttarior 


4370 4382 4355 

27 4.7 2757 2714 

208X38 2075.17 208584 

1D47B4 105X05 103565 

296X20 3009.88 300X51 

28800 28805 2B7B7 

58725 57009 5ES91 

217O0f 21700 21810 
67740f 57760 57420 

112X87 113X38 113805 

3834 W 28305 

) 14810 M810Q 144500 

120X13 120X57 118422 
920X1 91737 904.71 

S444EB 844008 634X20 

147X52 143X53 148501 

235372 25951.5 253180 

BZ7.4* 6268 831.7 


Transport 


243004 30 

1211.10 280 

330X37 4/1 

WHIM 18/2 

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253400 7/9 
678200 4/11 

1138.79 am 

39X31 31/1 

1601® 31/1 

1<Z13< 31/1 
103129 31ft 

7181.13 309 

175173 471 

Z8SS30O 13/1 

84800 2711 


1WX5I 11/7 

08001 21* 

2507-33 9/3 

291200 20* 

SB328 4ft 

174X00 14/2 
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3831.75 383X74 380X87 397X38 35005 397X38 

Olft) 14/4) 01/1/W) 

94 87 9454 9403 10501 94B4 100.77 

(71/1) (7/11) I1B/1OTS 

1487.17 148102 148205 186209 1*3X90 I 8 ® 28 

02) (8/10) CW/94) 

177.43 17141 17803 227 -OB 175.85 HX« 

(3/1) (3V9) B1®93) 

DJ Irxl Dev'S Wgb 3882® (36E705 ) Lm r379! 75) (nworebcat+l 

Day's Mgh 386X76 (384X55 ) Lo+ 381DB5 080605 I l/Wauetfil 


4102 

(2/7(321 

5409 

(1/10/81) 

1X32 

(8/7/32) 

1X50 

(8W/3J5 


i real time share prices 
►updated financial reports 


•daily unit trust prices 
•personal portfolio facility 


□awrarf 100(28/10*0) 134XSB 1345.14 1324X9 154X19 31ft 

feoTcp+lOOeaESQ 1193.11 119LS6 117326 131101 2/2 

jCsortO/gn (31/12188) M 335.77 33587 30X19 5/1 

Bat «9 &wb rmm 18101 1 sm 1 82.12 in jb 20 ® 


’ 2ft 

28/10 

1334.70 6 77 

1T3X72 27/10 
87X57 27/10 

618408 IB/3 

TI9X5B 4/4 

1298X70 24/3 

88100 4/4 


5/10 
113X48 5/10 
29020 21/3 
14105 21/4 


f and 

Composfin t 

MUlttV 

Ftanaa 

Peon 

48X40 

55402 

4205 

466® 

553.79 

43® 

463.07 

550.15 

4291 

48208 
OT 
68110 
C»ft 01 
4804 

n-ua 

43802 
(4/4) 
51005 
(21/4) 
41 38 

m 

atom 

(2/2/94) 

56118 

(26/10/94) 

4540 

(28/8183) 

4.40 

(I/G/32) 

302 

(21/BSa 

154 

(1/10/74) 

V/SE Comp. 

Aura Wd V* 

NASDAQ Crtm 

25501 

*5125 

767.25 

7® 28 

451. 05 

78704 

25429 

450.41 

76201 

287.71 

era 

487® 

C/3 

(OIM 

nun 

243.14 

44/41 

42207 

<28/61 

893.79 

(24ti) 

287.71 

(2/2194) 

48708 

(2/2/9*) 

88X33 

(ia/3ffl4i 

4.46 

(25/4/42) 

2901 

(9/12/72) 

5407 

(31/10/72) 


■ RATIOS 


Dow Jones HKL Dn. Yield 

S X P M Ov. yield 
S X P bid. P/E ratio 


No v 4 

Oct 28 

Oct 21 

Year ago 

2.78 

2.70 

2.72 

2.80 

Nov 9 

Nov 2 

Oct 28 

Year ago 

2.30 

2.39 

2.39 

2.41 

20.93 

20.B5 

20.B2 

2X01 


■ STANDARD AMP POORS 500 MP6X FUTWES S500 Umes index 



Open 

46500 

Latest 

467.40 

Changa 

+1.60 

H^i 

467.80 


470.60 

470.60 

+1.80 

470.60 

Jun 

- 

474.4S 

- 

474.45 

Op*" nn« Hourea "r® r>«w*u» 



Low EsLvol. Open art. 
485.15 100288 211J90 
470.60 3.738 22J242 

46 3^47 


NEW YORK ACTIVE STOCKS ■ TRAPPM ACTWITY 


aOmUtUQ 

eraiUftW 

N225 

Ct 300 (1/10*3 

twm 

Sector |WK» 

:0n(K4Mffle) 


63X17 

10200 


6308B 

HBXO 


. Q201X 817.17 IDS 

100X0 WX® 1W 


'lB2B4ffi19(2a»1«0^*«" 2 
' 87X40 28003 28302 Wwl 
..iSSs 153303 iaOZ7 1TIW3 T® 6 
ZJ2L46 218401 27103 284205 B/7 

103006.138101 MJ575B 1SlM3 0ft 


i ion 

MUD 10ft 

1738X7* 4ft 
26X22 VI 
140507 4ft 
107333 4ft 

4H 


, +g/._<n STOCK INDEX FUTURES (MATIF) 



Open 

SsttPrtoe Ctwnfla 

Hgh 

Low 

No/ 

19400 

1956.0 +00 

18590 

1935.0 

Dec 

1853.5 

19640 +6-0 

196X5 

194X5 

Mar 

19700 

19720 +6.0 

1979.0 

1079.0 


Esl uoL Open InL 

21,904 23.026 

317 26.071 

1 50 


Open Wereet #sp« ** pwAous day. 


Wednesday 

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Unchanged 

New Hgll! 

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Not 9 Nw 8 Not 7 
337.783 589057 2SSJB1 
1X175 18053 14061 

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0amp(4/4nQ mbimd. . #- itacjn vWnb e> & ir+*ws are 100 anapt Aawalla AS Odtooiy 

rtitavS ' TMa® PA* ««£■*»“ MX^oS&re Tbp-lOX BS3 O wwfcTaw tt 

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Stocks 
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504X7® 

XI 17.1® 

4270200 
5.182200 
30430® 

30760® 

3J6BJX0 
3^11.1® 

3,1810® 

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TdraSraoreWR ***** a® lowasi that It* Inda. ha. reed-d 


2011 2097 2.902 

903 1,107 824 

1.199 1033 MW 

719 7S2 896 

33 27 18 

1® 282 770 


The Future's History 


T )-,(.- bryost pro 
world WK 


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•nom lootures and ir.-doptll 


■ijn anyone el- 


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38 


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IBM to. FT 91 

Wk Low Stock Ob % E m Ificfi Low 

IT^njaAW 0.48 38 81 28 12% «% 1ft 

IB 1ft ALLA A 0.18 1.0 41 227 018 17% 17% 

7ft 5ft AVk 1.88 13 20 1073 74* 74* 

7ft 48* AMR 884821 51* 6D* 

5 ft MX 12 BS 3* ft 

5B* 38% ASA 240 4.1 32 504 4ft 48* 

32* 2ft MM. 078 14 1911013(132% 32 

15* IftMOf Pr 0J» as 11 831 1ft 12* 

2ft 17%AEMM 052 25 0 2 ft SB* 

IB 11* Acptncaht Z7 1483 15 14* 

31 2?MXta 0.44 15 23 522 2ft 2ft 
12* 6* ACM Sul nx 1JB11J 95 ft 9* 


72* 48* MR 
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58* 38% ASA 
32* 2ft MM 
15* 11%/MUPr 
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31 22 ACE LSI 


48* 48* 
32 32* 

12% 1ft 

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10* ft 404 GrOppa 000114 41 7 7 7 

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12 ft ACM G* Sex 1J» 130 438 8 87% 7% 

IT* 7%AOf Manx 158145 329 7* 7* 7% 

ft SJCMttngda OR 88 38 8* 8* B* 

15* 8* AcmCbx 044 17 14 958 1ft If* 11* 

13% 5* Acme Bact 11 40 11* 1ft 11 

2ft 23 Acwdta 060 2214 53 28 Zft 2ft 

13* ftACM 030 17 2 100 10 8* ft 

W% 11* AcuSttl 128 577 17% 18* ift 


1% iftAdmsEKpr 048 25 0 174 17 ift 17 

64 46* Ad Mm am 55 22 5ft 64* 54% 

I* IftAdiVc 350121 10 5234 2ft 24% 24* 

ft SAdnst&p 018 35 B 41 ft ft 5% 

20 15 AM Ik 010 05121 202 IB* Tft 18* 

84 49% Aegon ADR 157 24 13 28 62* 61% 62* 

85* 44Ae8aL 278 59 61178 47% 48% 48% 

38* 25* Mac 046 15 141663 34% 34% 34% 

22* IftAftmnsnx 058 55 12 1978 18% 17% 17* 

4 1% Ma»trc 1 AS 1* 1* 1* 

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iSAktmFnx OX 15 11 235D 


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035 15 31 384 18* 


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28* TftAIcnAI OX 10KS5GZ7 24% 24* 24* •% 

65* 49* AfcoSt 150 1.7 40 889 58% 57* 57% -% 

30* 23* Ato&mn 070 26 4 17 28% 2B% 26% 

22* KAMI 010 05117 290 30 19* 20 ♦* 

24% 17 Mesh Lori 048 2.4 IB 716 ZD 1ft 19* -* 

26% 19* Metf> 1 64 8.0 10 833 20% 2ft 20% -* 

25% 13* ASM Can 016 0 7 19 335 24* 23* 2ft -% 

28 2QABe>g*ix 044 15 17 856 27 26* 27 +A 

4* A Ann 1 64 * % * «£ 

27* 17* AtasCap 1.64 8 4 20 326 1ft 19* 19* -* 

10* SABKaO OIB 15 IS ft ft ft -* 

Zft 21*AUI0sn 090 37 15 15 24* 24* 24* -% 


ss 

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90* 04* Alcoa x 
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150 25470 4381 82% 60% 
34 3538 1ft 18% 


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8* 6* AnnaGd 


008 17 12 499 ft 6* 8* 


19% Annas M 052 25 13 37 

44 Asxnfte 050 15 62 1935 
8% AmAdfR* 024 28 145 

20% Am Bate* 010 04 31 7533 


20 19% IS 
48 46 46 


ZOO 65 ID 1676 34* 


9* 9% 3% 
23* 23* 23% 


25* 1ft Am Bra Pw 080 OB 13 X 21* 


Km* 

21 21 -* 


B 6* Am Cap Inc 065 101 218 ft 06* 6% ft 


2D* IS* Am Cap Bd 154 9 4 a 117 16% 016* Ifil 
2ft TB% Am C3P CV 158 57 0 a 19 18* 182 


100% 42* Ameren 155 15 58 1528o10p* 100* 100% 
37* 27* AmSPwx 240 75 1621531 31% 31 31* 

33* 25* Anfxp 050 23 13M6B 31% 30% X* 

3ft 24% Amend x 1.16 4.1 24 2810 23* Z7* 20 

9* 3% Am Oort tax 0.7713.7 588 5* 5% 5% 

27* 18% Am KtTh Pr 1X121 7 349 19% 19 19 

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2% 2*AaHaUS 0.75 27 J 9 10 2* 2* 2* 

96% 31% Anita 046 05 IB 5304 93* 32* S3* 

11* 6* Am On he 150143 «2 7 «* 7 

X 22% Amfrem 088 35 Hi 24% 24 * 24* 


100* 100% ft 
31 31* ft 
30% X* ft 
Z7* 28 ft 

5% 5% 


2% 2* Ob tab* 


96% 81% Anita 
11* 6* Am Oct 


11* 8% An On h 
X 22% Amftera 


l9AmPreM* 040 15 9 540 


8% 7% Am Red Es 044 57 5 60 7* 7% 
27* nAmStar 0.48 15 7 2817oZ7% 20% 
22* Ift An ¥Mr » 1 135 75 5 17* 17* 


32* 26 Am Hair 158 4.9 11 

43* 36* Amt* 132 45 14 

43* 32 Ameren Inc T 78 16 5 

18* 11% Amea* 024 1.4173 

64* 50% Amoco X 120 35 15 

ft ftAovcam 01Q 1.5 S 

5* 3* Aram Ire 012 11140 

34% 29Ansoua 1.40 48 9 

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30* 23% Andes X 

29% 24* RDBtftej 094 3.6 S3 

S% 47%fin8a*x IM 12 23 

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25 24* 24* ft 
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'* 17* 17* 


158 45 11 235 2ft 26* 26% 
132 45 14 2887 39% 39* 39% 


178 35 5 X 35% X* 35* 

024 1.4173 408 10 17* 17% -% 

120 35 16 0526 81* 60% 61* -% 

010 1.5 S 44 7 6% 6% -* 

012 11140 170 uS* 5* 5% ft 

1.X 49 91577 29% X* 29* -% 

9 487 2% eh ft 
OX 0 7 651422 46% 4S% 4S% -% 

33 1129 34* 33* 34% ft 
094 3.6 33 38 2ft 26* 2 ft ft 

IM 12 23 8594 51* 49* SO* -1* 

22 64 33% 33* 33% 


10* 14%An*«m»b 044 25 17 X 17* 17* 


X* XAonCp IX 45 I 947 32* 31* 

X* 22* AndwQD 028 15 X 1501 27* 26% 


B Apex Unn F 072 9.1 


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29* 21* Ara&On x 015 05 195485 
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7% 4* Anna 3 835 

33 22% Anrallp 110 9.1 MOO 


488 B 1 ! 10 

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7* 3Ap|M»m 1 912 3* 3* 


7 947 32% 31* X* ft 
6 1901 27* 26% 27* -* 
488 B* KB 8ft 
>0 6Su24% X* 23% 

1 912 3* 3* 3* ft 
H 133 24% 24 24* ft 

9 5485 27% 27% 27% 

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4 46* 46* 46* 

3 895 6% 6% 8* 
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5 2775 X* X 38* 

1 X 4* M* 4* ft 
3 145 25% 25* 25* ft 


57* 39% Anwar* IX 11 31 397 41% 41% 41 
45* 33% Ante Bee. 15 2775 X* XX 

7* 4* Ann Op 1 X 4* 04* 4 

31* Z3Arvtahd 016 10 13 145 25% 25* 25 

34% 21* Asms.* 040 1.4 06 «B4 28% 27% 27 

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44* X*AsMM 1.10 19 14 1456 38* 37% » 

25% 16%AstaPBcF 027 10 97 17* 17% 17 

3* 1% Asset taw 020124 5 289 2% 2* 2 


25% 16% AstaPacF 027 10 97 

3* 1% Asset hw 028124 5 289 
38* Z8*AesWGa 012 03X19X1 


17* 17% ft 
2* 2* ft 
38* 38* ft 
54* 64* 


57* 49* AWT IX 14 12201 54* 54* 64* 

7B3 l i2B* Afl IfchZ IX 1.1 3253* 253* 253* 

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9* 5* AlWa Sos 020 42 7 12 8% 8* 0* 

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112% 02* AIBfch 150 821X 2000100% 1X105% ft 
10 3% AM 2 97 3% d3% 3* 

ZO* 18* Atm Enor 092 15 7 IM 17* 16% 16% ft 

12* 0* AttwbAM 034 17 10 506 9* 9ft 

24% 17* Augela 0.10 08 X 209 20% 10% 19% ft 

12% SAuibtaW 010 12 IX ft ft ft ft 

»%47%AuDBa 080 12X2200 50* 57* 57* ft 

20* 13* ASOMO 044 23 11 X 15* 15 15* 

19 7* AM 004 04 4 » 10 9% 10 ft 

45-e*A«W 000 12X 270 X 37* X 

0ft 48%AwrtPrx 100 32 17 974 02* X* X* ft 

14% iftAjdnCorp 10 140 11* 11* 11* ft 

7% 5% Aar X 371 ft 8 0* 


24% 17* Auplx 
12% SAufttaF 


12% SAufttate 
58% 47%AuDU 
20* 13* Avemco 
19 7* AM 
45 30* ARM! 
63% 48%Awd>r» 




3ft X* BCE 108 

ft 8* BETADfl 021 

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22* ITBMHx 040 
27* X* BattrBc 048 
3D* 2<% BOCp 060 
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X* 1S% WTr1838 1.72 
23* iSBeerSbns* 060 
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37* 27* Bartons x 072 
X* XBectanhix 040 


722X 4X 
10 X 2 
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11 74 12S0 
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2B* Z7* X* ft 

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11 * 11 * 
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43* <143 43* ft 
70* 74* 74* ft 
63* 082% 02% -1 

fift 38* 39* ft 
25* 25* 25* ft 
38* X X ft 
41% 41* 41* ft 

10* 10* 10* ft 

^ iS 18^ ft 
10* 16* 16* ft 

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048 80100 892 6 

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140 13 9 9915 74% 
100 17 n 3523 27% 


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ft ft 

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020 00 X 1138 34% 33* 33* ft 
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2M1Z2 3 IX 23% X* 23% 

084 OB 12 9S2 9% ft 9* ft 

11 142 3* 3* 3* ft 

108 82 10 202 23% X* X* -* 

X 125 43% 43* 43* ft 

221 11 2 24*d24% 34% 

178 80 2 44 44 44 

104 B.1 3 X* X* X* 

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150 80 nOD 43* <H3% 43* 

1.00 11 X 2277 19* 19% 19* ft 

1.77 30 13 1952 48% 48* 48% ft 


EO* 52* IMMJk 
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102 40 11 1001 33% S3* 33* 
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102 14 IB B24 42* 41% 42 

100 32 1930868 37% 36% 37* 


19* 12* Mercury Fn a 032 13 25 1234 13% 13% 13% 


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X* 17 Federal 8g 042 22 10 198 i9>; 


X* IB* FocDeqtSt 


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73% 73% ft 
Z7% ZTh ft 
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40* 27% PipswOh 022 00 10 237 3ft 36* 

14* ftnateH 020 30 50 X 7* 7* 

55* 27*Pranu 3318493 30* 29* 


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088114 118 7% d7* 7* 

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04% ST*Prad6 140 12 X 4098 63* X* 62* ft 
40* Z7% PlpswOh 02200 10 23737*36*30% ft 
14* ft Rate H 020 30 50 X 7* 7* 7* ft 
55* 27*Pranu 3318499 30* 29* 29% ft 

X* 15%FWp17Ara IM 02 X 250 16* 10 16 ft 

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X% MPMX 104 44 9 XB 24dZ3% X* ft 


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200 44 9 6X 45* 45* 45* +% 

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18* Jacobs Eng 17 119 X 2D* X* -* 

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Continued on next page 




Ma! v 




FINANCIAL TIMES FRIDAY NOVEMBER 11 1994 ★ 


39 


NYSE COMPOSITE PRICES 


NASDAQ NATIONA L MARKET 4 pm dose November 10 






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ABUx 

088 16 

920 

24 23 23% 

ft 

AleghAW 

20 

54 

10$ 10% 10$ 


AlenOm 

002 14 

40 

36% 38 36% 

ft 

AfenFf) 

3 

776 

7% B% 7% 

ft 

AttCepi 

1JD 12 

IB 

14JJ 14% 14% 

ft 

Aid Cap 

am ii 

88 

13% 13 13% 

ft 

AtodteC 

03Z B 

9 

2% 2% 2% 

+% 

ABlfiold 

am re 

118 

Tii 1« 1H 


AUareCo 

37 6436 

38% 37% 38 

ft 

Am Batter 07Z 7 

309 

21 Z0$ 20$ 

ft 

AmOVoy 

0.16 

326 

17% 16% 16$ 

ft 

AmDyBu 

15 

40 

16% 16% 16% 

+% 

AaMerag 

161132 

1B% 18 1ft 

ft 

Am Mad 0 

9 

532 

6% 6% 6% 

ft 

AfflSottH 

am id 

029 

5 4% 5 


AmFrtwye 

35 

B69 

21% 20$ Zl 

ft 

AmGrtA 

056 1537D3 

26$ 26% »$ 

ft 

AnNntP 

1 

906 

1* 1 h 1% 

ft 

AmUh 

236 7 

(83 

46 45% 45% 

ft 

AmPwrCom 

32 3823 

17% 16$ 17 

ft 

AnTnw 

13 

328 

17% 16% 16% 

ft 

AbttdFto 

024 14 

592 

22% 22 22% 


Amneouc 

2117721 

57% 55A, 56% 

ft 

An tech Cp 006 12 

768 

9 ft ft 

ft 

Arorfto 

4 

469 

ft 9 9% 

ft 

Analogic 

IB 

3 

17% 17% 17% 


Aoehea 

062 16 

IB 

19 18% 16% 

ft 

AnangaiAm im 13 

7 

15% 15% 15% 

ft 

Ante aw Cp 

271133 

49% 46 48 

-i 

AnchB Ad 

9 

424 

17% 17 17 

-% 


Apogee En Q32 X 1658 1118% 17% (ft +% 
WHO 51 206 5% ft 5% ft 

AppIdMrt 3311157 50% 48% 49% -1,% 
flpplaC 048 3613GD9 41% 4i 41 ^ 
Ifftteu CUM 471179 18% 17% 18% -fl 
Arbor Dl 014 49 242 U22 21% 21% +% 
Aracox 01915 llB a 19% 19% 
Aigralx 1.16 8 253 S% M% 26% ft 
Amur A! OM 21 229 21% 21% 21,% -ft 
Aractthx 044 18 232 21% 29% 20% ft 
ta(XCR* 32 893 36% 34% 35% ft 
AssocOamm 323 916 28 25% 25% ft 

ASlitach 84024 12% 12% 12% 
Alkhsai 13 SS ift 10% 10% ft 
AHSEAD OS 11 6121 16814% 15% ft 

AWfck 024 121633 32% 31% 32 -% 

Aauhlb 9 119 3 2% 2% 

AtOHUfe 032 20 94 7% 7% 7% ft 


- B - 

BEIB 008 27 8 5 05 5 

Babbages 12 396 14% 13% 14% ft 
MbtHM 106 ft ft ft 

BtttfJ 006 101146 17% 16% 10% ft 

BUMnOBaOM 3 60 15ft 15 15ft -ft 

BandBC 15 2199 22% 21% 21% ft 
BnfcSaufil 052 10 446 17% 17 17% ft 

BankosCp 040 7 109 14% 14% 14% ft 

Banmxttl 060 14 119 24% 23% 23% +% 

Bam Gao OS IB 348 3ft 32% 32% ft 

Basel Fx 090 161063 30% 29% 29% +51 

Bay View 050 11 340 20% 20% 20% ft 

BHankax ISO 13 480 57% 57% 57% 

88ST Bn 1.16 9 419 29% 29% 29% 

BE Am 21 368 8% 8% 8% +ft 

Baautiou 042 32 13 15% 14% 14% ft 
Ban&Jeny 12 273 12% 12% 12% ft 
BMtoVIffl 044 12 22 34% 34% 34% 
BHAQrp 012 19 135mft 12% 13 


Blhc 

97 396 

5 4% 4$ 


«pB 

016 181306 

13 12% 12% 

ft 

BtadeyW 

OOB 14 1247 

13% 13 13 


Btogen 

107 01 

40 38% 38% 

-% 

Btomd 

202181 

11% 11% 11% 


BtockDrg 

IM 13 540 

35% 34% 35 

ft 

BMC Salto 

14 1575 

46 45 45% 

-% 

BuatmenS 

138 9 2291 

39% 29% 29% 

ft 

Bab Evens 

029 18 227 

20% Z0% 20% 

-% 

Baaie&B 

12 26 

25% 24% 24% 

ft 

Bartend 

10 6653 

10% 9% 10 

+A 

Boston Bk 

076 5 111 

30 29% 29% 

ft 

Boston To 

reiou 

17 16% 16j! 

•ft 

BradyWA 

080 18 72 

48% 47$ 48% 

ft 

Branca 

OM 28 147 

12% 12% 12* 

ft 

Bruno S 

026 19 722 

B% 8$ 9 

ft 

BSBBncp 

068 8 66 

27% 27 27% 

•% 

BTShiprg 

048 5 19 

2% 2% 2% 


Butters 

14 3B55 

10% A% 9% 

ft 

Bidders! 

18 132 

11%d10% 10% 

ft 

Bur Brea 

491900015% 12% 14% 

+i 

BitatoessR 

ffi a 34% 34% 34% 

<i% 

Buferurg 

040 9 38 

35 34% 35 

ft 


AMEX COMPOSITE PRICES 


4pmda8eNoMHtxr10 



14% 14% 14% 

IA ft ft 




CBfecop 2 3 

Canbrexx 020 14 23 
Can Mate 01419 7 

OantnA 001 3 773 
OBandfi* 4 1® 
Brampton 49 7 1 
OrcFti OM 41 550 
OiWFdA 011 114 

Cwdnco oaoiffl 19 1 


OOCDpO&iP 


T- 



I ft 8% ft 

I 16% 18 +% 



Pi — 

Stock Dh E 1B0» tttfi Lawdoee CXnp 

Coned FW 5 14 

CmnAT Ax 084533 67 1< 

COMIC A 040 6 10 1! 

Crown CB 046 12 4 14 

Cubic 053 82 23 It 

Cuxtomaitx 15*100 

Otkxfe 12 50 1 1 . 1 , 

Umft » 78 16 15% 15% ft 

Dacoramun 9 87 ft ft ft , 

(MUX 048 8 14 9% 9% 9% ft 

EMin CD 046 13 4 13% 1ft 13% 

EcfaOftn 007891 2350 11% 11% 1ft -ft 

EootEnA 030 B 41 10 ft 9% 

EdbURa 4 10 6 5$ Oft 

EH IS 1948 34% 33% 3ft -1% 

1220 18% 1ft 13$ 


fcp™pn 


12 121 19% 1»% 19% ft 


Fab Into 064 11 5 30% 30% 30% ft 

FtnaA 4S01S • 70 70 TO ft 

FsffiflyBnc 029 13 ZlOO 11% 11% 11% 

FW8|4 036 75 21 30% 30% 30% ft 

Forest La 28 310 47% 48% 4ft ft 

Fnomcy 3 31 sfi is 3ft 

annx 080 5 64 1 

GfeOlFttAX 072 15 309 

OtoBr 070 34 144 

MB 1 205 

ftaaannn 13 17 - - - 

OtoCda 034 7 433 ® Oh 3% 



HanOk 

Hatoxnx 

UatottQi 


23 856 4% 4 4ft 

028 14 548 31% 32 ft 

4 3 2% 02% 2% 


W 32t 

Stack DhL E 100» OA ImdauCtano 
HUcAm 1 62 1% 1% 1% 

Hrico Ol5 42rlOO ft 9% 9% 
HnanHA 7 130 S d5% 5% ft 

fesbrrCp 012 28 ZlOO 11% 11% 11% ft 

tat Cam 3 553 3% 3,V 3A +& 

Mnnagn TO 218 i5$ ift 15% 

tax* 006 181280 18% 18% 18% ft 


Jan Bell 

KMm 

KtamNCp 

KbbyBe 

KogiEq 


3 356 5% 5 5% ft 

8 % J a ft ’g +% 

19 60 if 1ft 18$ ft 
87 115 B% B% 8% ft 



Ltoarge 3 70 K 

Laser kxl H 50 

Laa Rmnn 4 X 

Lumen toe 220 6 13$ 13% 13% , 

Lynch Op 9 3 28% 29% 29% -% 


4 152 36 34% 35% -1 

Media A 041 26 170 28% 23 28 ft 

MamCa 020 38 S 5% 5% 5% ft 

MMU IDO 7 7 7 

ItoOQA 13 ID 7% 7$ 7% ft 

MSflExpl 37 166 IA 1% 1% ft 

Hal PH 4 289 2 lU 2 ft 

NVIDIA 056339 679 24 2ft 23% ft 

NDlWnOI 020 14 2 10% 10% 10% ft 

NaraacE 125 16 6% 6 6% ft 

Nffl 2B2 379 5% 5% 5% 

Ofetan 024396 820 32% 31% 31% ft 

G OIO 9 523 14% 14% 14% ft 


7/ 5»S 

Stack Ur. E 100s Ngb LflwCtoaaamg 


PWW 

PbWwB 

FMLD 

noway a 

Ply Gem x 
PMC 

PranaSnA 

Rprttad 

RBSWCp 

SJWCa rp 
SOmUnton 
SWUte 


080 17 62 10% B% 10 

1JB4 9 2 17% 17% 17% 

DJ4 152402 60% 59% 5ft 
050 21 38 U39 3B% 39 

012 
OM 
0.10 


Z1 0o ltd JB*b ■» 
43 Z48 19% 18% 16$ 

t ’o 51 'YS % 


t 


X ZlOO 
4 IDO 




210 9 4 34% 34% 34% ft 

18 281 18% 17% 17% -% 
1079 3% ' 


Tab Prods 020 47 B 
TtoBDaa 028 67 1088 
Tbermadct 67 496 
menndns 33 489 
TntPNA 020 X 12 
rownOiS? 4 IMS 
TlDon I 75 

TubOS Me* 7 X 
TuntfkA 0S7 66 98 

Tumr&fl 007107 260 


UBffaxaA 5 zioo ZiV 2/« 

UMFeodA 0Z0106zin 2% 2% 

UrXvPtnB 45 23 7 B% 

USQslU MB IZ4 33% 31% 


d3% 

&% 6 % 8% 
46 45% 45% 
15 14% 14% 
30% 3042 30% 
14% 14% 14% 
?A m I 

ill i% ft 

5% 5% 5% 
18% IB IB 
18% 18% 18% 


UtaeunA 25 1078 397 

VtomB 10735 384 

WaathwH 26 8222 11% . 

1MRET 1.12 17 m 12% 12% 12% 

Htanben x 060 13 19 28% 28% 28% 



xytrcnlx 


4 59 4% 4% 4% -% 



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• C .\y** :**•••, • t :: j ,.' * 


■ Vftv . ■ 

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r^ron thp edee over vour cwnpefltors by havkrg the Rnanciaf rones deitwred to your home or office every working day. 

are wSlaWe for all subscribers who writ or live in the business centres of Aix en Provence, Bordeaux. Cannes, 
Hand deUvery seW&u *?* ^ Marseille, Metz, Monaco, Nanry. Nice. Paris. Strasbourg, and Toulouse. 

3 Please call (11 42 97 06 23 for more information. 

Financial Times. Europe's Business Newspaper. 


-C - 


CTec 

265 

43 

27% 28% 26% 

-% 

Court Med 

6 

305 

5% 5 in 5% 

-% 

CadSchwps 099 18 

45 

28% 28% 26% 


CuhxBComom Zi 

2 

17% 16% 17% 

+% 

Caere Cp 

900 21 75 

18% 17$ 18 

-% 

Catena 

2J5 4 K54 

8 08% 7ii 

ft 

Cal Mere 

281655 

31% 30% 30% 

% 

CandetoL 

r7 

12 

2% 02% 2% 

ft 

hmaaii 

3 

348 

1u 1% 1$ 


Canon he 

053124 

46 

SO 89$ 69$ 

ft 

Cuomo 

44 

60 

6% 6% 6% 

-% 

CariunCm 

053 23 

6 

Ift 28% 28% 

+% 

nawto 

060 2? 

15 

23% 23% 23% 

ft 

Casey S 

om 19 

231 

13% 13% 13% 


Cetane 

4 

667 

6% 6% 6% 

ft 

CSICp 

IB 

3 

12 12 12 

+% 

PjftrrtT* 

6 

374 

16% 16 16 


CnoiFW 

1.12 10 

417 

28% 27% 28% 


CnrrtSpr 

21 

20 

10% 10% 10% 


Chandtor 

B ZlOO 

5% 5% 5% 


OGmieri > 068 8 

628 

19% 18% 1ft 

ft 

QxmSh 

009 9 1570 

7% 06$ 7% 

ft 

Oxantab 

18 

3 

13 13 13 

+% 

Chempoww 

14 

15 

4 3$ 4 

-.05 

CHpa&Ts 

12 3003 

6% 6 6% 

+% 

OttonCp 

56 6388 

61 59 59% 


Ckai Fin 

128 11 

924 

50 49 49% 

ft 

ChtasCo 

017 33 

436 

35% 34% 34$ 

ft 

OnusLgc 

29 5287 

28% 27% 27% 

-% 

OS Tech 

13! 

384 

2/1 2& 2% 

-ft 

OscnSys 

1630415 

31% 30% 30% 

-% 

CrzBancp 

1J» 15 

64 

27% 27 27 

-1 

CfeUlMK 

21 

234 

6 05% 6 


CMs Dr 

41 

27 

12% 11% 12 

+% 

Ckrthastm 

7 

513 

4% 3% 4% 

+% 

CocaCdaB 

im is 

101 

26% 25% 25% 

-% 

CodaEngy 

135 

152 

6$ 6% 6% 

ft 

CHteAtam 

27 

7 

10$ 10$ 10$ 

-% 

CognwCp 

36 

12 

23% 22% 23% 

ft 

Oognoa 

130 

82 

14% 14% 14% 

ft 

Coherera 

18 

211 

Dl5 14% 14% 


Couagen 

040 92 

453 

23 22% 23 


COM Gas 

1Z6 12 

21 

19% 18% 19% 

ft 

CoMSpk 

060 12 

26 

33% 33% 33% 

+% 

Caoalr i 

032 13 

650 

19% 19% 19% 

+ft 

CmCEtA 

009 21 2680 

17% 16% 17% 

+% 

CmcstASp 

009 4414485 

17% 17 17% 

ft 

CuunGtetaiom H 

835 

32 31% 31% 


CommCi 

070 B9 

9 

17% 16% 17 


ComirmC 

IB 

460 

27% 27% 27% 

ft 

ComprUXo 

3GB 1123 

9% 8% 9% 

ft 

Comshan 

61 

572 

14% 13 13% 

-% 

G0Dt5hcftfl 

34 

89 

ft 3 ft 

+A 

Consflum 

5 

92 

G 5% 5$ 

ft 

ConadCel 

61 

S8U24% 24% 24% 

+% 

enrffiata 

156 

143 

ft ft 6% 


CoareA 

Om 24 1085 17% 16% 17% 

+% 

Cmyleto 

35 

415 

ft 4% 4JJ 


Conks Cp 

27 3726 61% 59% 60% 


Cup 01 A 

46 

IM 

17 16% 16% 

ft 

Crachsfi 

002 254386 21% 21% 21% 

-% 

Cray Comp 

1 6669 

1ft 1% 1% 

+% 

Cream Res 

35 

303 

5% ft ft 

+% 

Cyiogen 

2 

700 

3% 3% ft 

ft 


- D - 


DSC Cm 

2010236 31% 30% 31% 


Dari Gnu 

013 33 

9 

05 83% as 


DataSwttn 

41 

49 

2% 2% 2% 


Dateflex 

35 

172 

8$ B% 8% 

ft 


16 

243 17% 17 17 

-% 

Dauoiwtip im 10 

172 

24 23% 23% 

-.1 

DeC Shorn 020 14 

20 

4$ 4$ 4$ 


DAMP En 

032 23 

iff) 

16 15% 15% 

-% 

Dekalb Ge 

Om 44 

116 

30 29% 29% 



N B> 


Stott 

Oh, E loot wga Law Late 

CM* 

MfranpeiOjU 8 24 18 17% 18 


Dai comp 

4610234085 44% 44% 

% 

DRW 

030 27 796 31% 31% 31% 


DepOy 

1.12 8 267 29% 28% 28ft 

*& 

Damn 

020 8 3 8% 8% 8% 


DH Tecta 

20 668 25% 25 25 

ft 

DtoralB 

080 28 920 20 19% 19% 

ft 

DU Ml 

16 218 17% 16% 17 

ft 

Ng More 

81582 14% 14 14% 

ft 

Dig Sound 

75 1962 3ft 2$ 3 


assy* 

37 572 10% 10% 10% 

ft 

OknaxCp 

17 125 37% 87 37 

ft 

□Menu 

020 32 92) 7% d6% 6$ 

ft 

DNAPhrt 

21123 3$ 3% 3% 


DobarCn 

020 29 2168 29% 29% 29% 


DuttaHn 

am 14 2 12% 12% 12% 

ft 

OrecoEagy 

9 700 9& B$ BA 

-ft 

DmAn 

11 1172 10% 10% 10% 

ft 

Dray GO 

OM 2T 570 25% 25 25% 

ft 

DrugEmpa am 48 403 5 4% 4$ 

ft 

DS Bancor 

im 13 588 14 23 24 

+T 

Durtrcnx 

042 13 232 18% IB 18 

ft 

Dyittech 

11 3916 30 29% 29% 

ft 


EagtePd 

- E- 

1 15 2% 02% 2% 

-% 

EaaelQp 

1 5350 3% 2$ 3% 

ft 

GtotEmnnl 

S ZlOO 1 T T 

+% 

EG Tel 

032 23 2247 18% 18% 18ft 

ft 

Egghead 

134 602 8% B 8ft 


BPaaoB 

0 693 1ft & 1 

+ft 

BrcUSd 

17 1038 17% 18% 17% 

ft 

Bactta 

OS 51 12 50$ 50$ 50$ 

+1 

EfecMm 

22 9765 18$ 18% 18% 

-1% 

BnanAas 

14 138 4$ 4% 4% 


Emote* 

448 10$ 10% 1(& 

+ft 

EngyUHra 

a 3 14% 14% 14% 


Enter Sw 

66 10 2 2 2 


Enzonhc 

2 358 2ft 2ft 2% 



010 20 58 5% 4$ 5% 


Erica* 

0481685222 60$ 50% 60% 

+% 

Bhicl 

260 7% 7% 7% 


EonsSdi 

31 729 12% 11% 12% 


Exttyia 

28 2076 22% 21% 21% 


ExeaObu 

10 67 6% 7ft 8 

-% 

Bttflac 

11 341 16% 15% 15% 

ft 

Expedhl 

OIO 26 413 22% 22% 22% 

ft 

EzrexpAw 

16 5869 10% d9% 10ft 

ft 


- F - 

Faf firp 10 23 4% 4% 4% 

FtarCp 024 40 87 6% 6 6% ft 

Faxtenal OM 67 1061 43% 42% 42% -1% 
FM* taU 16 1829 27% 26% 29% ft 

FBdiTlwd 124 15 580 62% 51% 51% ft 

FKyOfl 13 206 4% 4% 4% ft 

BggtaA 024 01261 7% d7% 7% ft 
Plena 38 3096 26 24% 25% 

Riel Am x 1H) 7 500 29%dZS% 29 ft 

FbScOMd im 10 23 24% 23% 23% ft 
FtoOAk 060 19 196 22% 21% 21% 
FstSsdy IM 102247 »% 25% 25% ft 
FtoTem 128 101146 46 46% 4572 ft 

FStadHC 056 51735 19% 19 19% ft 
fttohl TM 8 TO 32 3Z 32 ft 

FfcUmfes 55 60 9% ft B% ft 

RSOV 28 91 22% 22% 22% ft 

Flow tot IB 317 6% 8% 6% 

FOOdLA 009 151020 5% 5% 5% 
FoodLB 009575 B14 6 5% 5% -/« 

Foremast k lJB 10 120 33% 32% 32% ft 

FaBdmer 10 133 It (0% 1ft ft 

Faster A 40 13 3% ft 3% 

RlhFtax 104 12 415 31% 31 31% ft 

RJfW 040 7 221 14% 14% 14% +% 

FtoHawto 1.18 10 123 27% 25% 27% ft 

FitoerW 058 21 393 33% 32% 32% ft 

FUUflRn 068 10 16 18% 18% 18% -ft 

Finn 024 25 624 20% 19% 20 
FuboedADR 10 81 2% 2% 2% 


■ Q - 

6SAPP 5 4 2% 112% 2% 

GSJCSarv 007 25 6 1ft 1ft tft 

Samos 0 11 2% 2% 2% 

Garnet Rs 10 25 3% 3% 3% 

Banco 016178 51 7% 6% 7% ft 

GaXBtod 0.42 22 21 21% 20% 21% ft 

Gentyto 17 424 4% 4% 4% ft 

GensJaPb 1 4224 4$ 4% 4$ ft 

SHttxCp 40D 39 241 Zft 22% 23% 

GenusHC 206 292 ft 8% 6& ft 

Genzyma 41 2137 30% 29% 29% ft 

Garni Gt 040 19 1148 15% 14$ 15% 
GkUngri. 012 121974 16 15% 15% ft 

GBWlAx OU 8 17 13*4 13% 13% 

Sal) Hm 13 116 6% 5% 5$ ft 

GoodGuya 16 625 12% 11% 12% ft 

Gotfitfmp OU 18 141 21% 21 21 

GnidcoSys 400 12* 4% 3$ 4 

Granite OTO 71 301 22 21% 21% 

Green AC DM 12 3 19% 18% 19% *1% 

SnwcfaPh 0 2247 £ A A 

arasmns 71 665 2% 2% 2% ft 

Ore) Mr 557 16 12% «% 11% ft 

(TO Cop 11 151 16% 15% 15% 

GDNV5vg 51126 8% 6% 8% ft 


- H - 

tabling A 63 45 7% 7 7ft 

Hartovyto 068 9 Zl 00 23% 23% 23% -1 

taper Gp 020 12 159 14% 13% 14 ft 

taiteCmp 177 12% 11% 12 ft 

H90&CD 0.1B 27 2525 33% 32% 33 ft 

tafttaw 27 3424 29% 29% 29% ft 

HBtotacre 066 20 300 1 2% 12% 12% ft 

HraWKftn 12 306 8% 5% 8% ft 

Hachhger 0.1619513 11% 11% 11% ft 

Vtettrej 194 9% 9% Bg 

HafenTrey 11 8W 18% 18% 18% ft 
HOW 088 11 777 17% 17 17% ft 

HoganSys 015 19 2250 6% 6 6 ft 

Hotoglc « 480 15% 14% 15% ft 

Home Bert 060 6 7 20 (CO 20 ft 

Hmmds 044 18 20 26% 26 26 

tanbeck 16 557 14JJ 14% 14% ft 

HtnaKRes 044500 2D 5 S 5 

HlxN -B x 020 1514Z7 16 15% 15*2 

Hunongm 080 7 6656 18% 17l 2 18% ft 

Hum Co 006 1 117 4% 3% 4% 

tteftteert 129 216 23% 23 23% ft 

HytWBIO 17 79 4% 4% 4% ft 


- I - 

FflSys 56 12 9% 9 9ft 

nfiComms 26 3983 9% 9% 9% ft 
US total B 341 3A 3& ft ft 

taanucar X 294 6% 6 6% ft 

Di xn unogen 1 889 3% 2% 3ft 
Invert Be 040 30 229 15% 15% 15% ft 
hd task 024157 62 11% 11 « ft 

H Res BO 2642 16 14% 15% ft 

Httmtx 308831 26% 24% 25 ft 

htfesMkl 066 14 160 11 1D% 10% 

kvutoutp 13 2785 20% 19% 20 ft 

kXBgrDev 33 7733 28% 27% 27% -% 

totgUSys 40 69 16% 16 16% ft 

totatMM 7 113 2ii 2 A 2% 

Hto DM 1133357 61% 59% 81% ft 
knell 8 752 2% ft 2% ft 

HtfltB* 040 24 3169 147g 14% 14% ft 

Wet Tel 18 1053 6% 9% B% 

lnterteAk OM is 225 n% n% n% -% 

krtgpb 3 ASS 8% ft 8% ft 

btBtad 2 992 ft 4% 4% 

tntentve 61196 16% 15% 15% ft 

tatcrnlc 26 Til 15 14% 14% ft 

HDdliyQA 14 129 17 16% 16% ft 

WRB3 002 IB 1D6 2% 2% 2% ft 

M Totil Z75 16 5% 5% 5% 

ta» 005 21 103 31% 31% 31% ft 

kmgaCp 3 5i 4% 4 4% ft 

HlMril 16 83 18% 17% 17% -% 

BoYdkado 1.12 38 2 714 214 214 


- J- 

J&JSih* 13 72 12% 11% 11% 

Jason re 028 13 2 B 8% 9 ft 

JLG M 010 32 23 38 38 37% ft 

Johnson W 56 509 22% 22% 22% ft 

Jones M 10 908 14% 14% 14% +% 

jbnesUed HO T9 235 8% 8% fl% ft 

JHynCp 120 26 246 26% 26% 2fi% ft 

JSBFtai flJO 15 70 24 23% 23% 

Juno Liu 020 IB 711 19 1ft 1ft 

juatn 016 10 730 13% 13 13% 


FI Ife 

Stott hCMfeklraWON 


- K - 

K State 006 11 604 71% 21% 21% 

KananCp 044 5 903 0% 9% 9% ft 

KefeyM 3 1® 8% 5$ 5% ft 

fe&ySv 072 24 114 29% 29 28 -% 

XHHUGky 011 10 60 021 B% 021 +J» 

W 084 13 96 24% 23% »% ft 

KtaBhnar 22 21 10% 10% 10% 

HUM 681690 52% 51% ft 

Knowledge 2 533 4 3% 3% ft 

KOI A 1 1018 J} % % 

Kmagbv 2Z7 962 25% 24% 25 ft 

KoSefccS 121178 18% 18% 19% ft 


- L - 

Uftem are » 2S5 ]&%4fl5% 15% ft 

Ladd Fan 012 35 107 8% 8 6ft 

Lantech 47 3422 42& 41% 41% -1% 
l*ntar (MS >5 511 3S 34 34% 

Lance Inc 098 17 87 18% 17% 17% ft 

LmfettGph 25 323 20% 19% 20 ft 

Lanopbca 9 23 7% 6% 6% ft 

LBSerecpe 28 228 4% 4% 4% ft 

UUceS 141238 16% 16% 16% ft 

LBMBOQPr 048 IB 44 25% 25 25 ft 

LOOS 33310167 23% 22% 23% ft 

U»Q> 016 1 54 5% 5% 5% ft 

LectlHS 21 11» Ift 17% 17% ft 

Legem Cp 18 6323 31% 30 30% +% 

Life Tech 020 16 15 1B% 18 1B% ft 

Utatte 28 27 16% 5% 5% ft 

LtaykxM 028 12 143 14 13% 13% ft 

Ulfr H08 132140%139%140>4 ft 

LtaCOil T 052 16 703 17 1B% 18% -»% 

LkxtaayW 13 15 30% 29% 30% ft 

UnesrTfic 028 392997 49 47% 48% ft 

UqaBn 040 17 GO 35 033 34 ft 

Lumen Eb 009 2] 9*9 26% 25% 26% ft 

lorn star 13 232 7% 7 7 ft 

LotasO 3624730 38% 37% 38% ft 

LTXCp 3 424 ft 4% 4% 

LVW 048 4 9 32 31% 3Z 


HQ Cm 005 1933610 22% 21% 21% 

ME Car's 19 246 23 22% 22% -& 

Mac U9 x 050 40 29 12J8 12%1290 -M 
MadsenGE 1JB 14 45 33% 32% 32% ft 
ttvnapwr 161287 37/. 36% 36% 
ltagm&p>orei3 ® 2D 19% 19% 

Mai Box 15 56 9% 9% 0% 

Macau Cp 111 S91 ift 9% 10 ft 

MartaaDr 10 327 4 3% 4ft 

IfexteiCp 9 21 41% 41% 41% ft 

Marquest 2 30 1% 1% 1% 

Mamma 17 49 8% 8% 8% 

MHttSo*AD44 11 9 11% 11% 11% ft 

Mata* 090 TO 459 20% 2 0 2 0 -A 

Uasmc 9 37 7% 7% ft ft 

Uadhltm 49 1044 84% 63% 84 ft 

Maxtor Cp 0 698 3% 3% 3% 

McGnNhn 044 12 B 16 15% 18 ft 

McOomdc 048 15 1659 19$ 19% 19% -ft 

Medextac 016 19 732 15% 14% 15% ft 

MadfctasS 056 13 »8 23% 23 23% ft 

■Utantoe OM 73 329 10% 9% 10% 

Manta Cp 016 56 684 17% 16% 17 ft 

MHAG OM 32 1302 1 2% 12% 12% ft 

UereantB OBO 11 213 20$ 20% 20$ 

HamoryB 070 8 792 29% 26% 29% +1 

MMttnx 138 10 B» 28% 28% 28% ft 

Moisei 91001 9% 9% 9% ft 

MtoMdeA 012 19 110 19% 18% 19 ft 

IffSCm 24 1325 38% 37% 3712 ft 
Mdaei F x 020 23 1034 12 11 11% ft 

MtaNtoB 2003621754 90 79% 79% ft 

MkacHIh 11 134 5 4 4ft 

Mtaoaoe 91132 11$ 11% 11% ft 

Meroeom B 822 9% 9% 9% ft 

Mkrgodx B 644 5% 5% 5% ft 

MtapoK 3 841 8% 8% 6% ft 

MCSlt 3314857 64% 63% 63% 

MU ASM 24 8 26 27$ 26 

Mttanac 068 10 2321 Z7% 27 27 ft 

MXMZata 050 21 274 25% dZ5 ZS% ft 

MbH 052 18 ZS3 25% 25% 25% ft 

MBan 2977(02% 30$ 31% *1 

MtaUeds 19 143 15 1ft 14% 

MoMeTei 71 1337 19% 19% 18% ft 

Modem CD *020 20 82 8 7% 7$ ft 

Modhe Ml 052 22 189031% 30% 31 ft 

Mata 004 54B 40% 39% 39% ft 

Max he 004 30 608 42% 40% 40% -1% 
Muscat! 0641391533 8% 8% 6% +% 
MastaeePx036 IB 140 26%<CS% 26% ft 
MTS Sys 056 9 B 22A 22ft 22,1 1 % 

Ulined 12 324 29% 28$ 28$ ft 

Mycogen 5 760 10% 9$ 10 ft 


- N - 

NAG Ge 01611 54 26% 26% 26% ft 
NashFnch 072 n BB 16%dtS% 16% +% 
ta Comet 036125 358 U1S 14 IS ft 

NksSUi 020 21 217 14% 14 14 ft 

Natogatar 6JB 6 17 17% 15% 15% -1% 

NEC 043102 76 56% 59% 59% ft 

taker 201488 u33 32% 32% 

NetwhGen 302442 21% 20$ 21% ft 
NtoWkS 841103 7% BK 6% ft 

Neungea 9 0*7 6% 6% BA ft 

NewEBusxOU 21 109 18$ 18% 1B$ 
fkiw Image 31 603 5% 5% 5% ft 
nadgeNto 22 1414 30% 29% 30 

NewprtCp 0« 21 95 7% 7 7ft 

No&feM 21 1888 7% 7 7ft 

Norton 058 Z7 28 60 50% 59% ft 

Ndtorm 040 2711104 46% 46% 48% -1% 
tantanl 14 20 19 18% 19 ft 

NStarUn 43415%5%5%-ft 

NorthnTS 088 11 598 35% d35 35 ft 

NMTAir 203486 19% 18% 19% ft 

Novel 91623512 1B% IB 18% ft 

tavefen 48 3201 54% 52% 53 -1% 

NPCA 84 6>2 0% 6% 

KSC Cap 8 2 3% 3% 3% 


- o - 

OCharieys 18 154 11% 10% 11% ft 

OcteiCam 16 476 21% 21 21 ft 

Odettes A T8 61 6% 6% 6% ft 

OttstmU 14 298 13$ 13% 13$ ■*'*> 

OgfeboyN 120 10 5 31 30% 31 

OKife 1.48 G 65 30% 31)14 30% ft 

OUKetlx IM 10 319 32% 31% 32 

OU HUB OflZ IB 2 38% 36% 36% 

Onbancwp 1U fi 171 26% 25% 26% +»*, 

One Price 7 614 s% 9% 9% ft 

OracteS 8315620 44% 42$ 43ft 

OrbScnca 50 584 20% 19% 19% ft 

Ortnach OU ZS 33 9% 8% 8% -% 

OnchdSapp 6 31 ft « 9 

OregonMto 031 1Z 57 0% B% 6% 

Oshap 15 217 2% 2% 2% +.11 

OehkBA OTB441 286 13% 13% 13% -% 

W*oabT»O50 11 12 11% «% 11% ft 

OtfeiTelx 1.72 14 50 31% 3131% 


- P- Q - 

Paccar TOO 11 176 44 % 43% 43% ft 

flacODfcp 062 II TOS J2% 12 12% ft 

PTeternx 1J2 19 2B/030J4 29% 28% ft 
PactBCre 28 350 71 69 69 -2 

Penmtorc 42 4635 36% 35 35% ft 

PBydiex 038 45 483 37 36% 36% ft 

Payee Am 19 148 8% 7% 7% 

Ptwrtesx 050 64 16 14% 14% 14% 

PwiMy 10 91olB% 15% 16 
PBmVbg 180 24 3 34 33 34 

PM* 072 18 24 41% <1% 41% ■% 

Ptntadii 13 60 5 4$ 4$ ft 

PtoraesU *03)25 9Tfi 22% 22 22% ft 
Peoples H* 0.40 1310B9 13% 13% 13% ft 
Petrous 1.12 14 126 2B%U2B% tt% +% 
Ptonnacy 45 803 15% 15 15% ft 
nuenxTch 361214 7% 6$ 7% +ft 
PVxmi 048 3 13 8% 8% B% 

PUUnto 4820*6 22% 21% 21% ft 

Ptaenon a 27 »8% 1ft 1»% ft 

Ptonaer&p OM 33 238 49% 47% 48 -1% 

Ptamtfi 0£8 22 902 33 32% 32% +% 
FtoresrSt 012 10 345ulft 1ft 19% ft 
PlUbh 480 8% 7$ 8% ft 

Rowel 15 71 5% 5% 5*2 ■% 

Pres Lite 0J)9 3 223 5% 5% 5% ft 

Pressteh 145 B80 39% 38$ 39% ft 

PMCoat 23 5348 18 15% 15% -% 

Pinto Pet 40 67 5% 5% ft 

PTWroti » 174 22% 21 22% ft 

Prod OpS 024 23 631 25% 25% 25% +% 

PuitanB 012 132891 24ft 23% 24% +% 
Pyramid 51231 10% 9$ 9$ -% 

Quadratic 10 26 8% 8% 6% 


H tb 

laa re. F ion ta t» lu Sag 
(hekaOBi 002 72 ZlOO 18 18 IB 

QuiFcod IU0 19 129 21% 21 21 -% 

Ctaariun 694562 15% 16% 15% 

Ckkkatv 23 358 16% 15$ 1127 +.15 

oveme a 4614 *z% 42% 42* 


- R - 

fettMf 15 815 16% 15% 16% +% 

Dalys 3 470 4 ft 3$ 

| tetoareps 1 710 3 d2% 2% 

taymcnd 24 38 18% 18 18 ~% 

Italian 18 137 19% 18% 19% -% 

HaUt A 22 5 2ft 23% 23% ft 

Wben 71487 2$ 2% 2% -% 
teplNBSto 7 701 04 3% 3% 

Rrarehtod 23 2206 D14 13% 13$ +% 

DBUBtS 037 162482 46% 45% 45$ -% 
Damn he 9 330 5% 5 6% 

RherFto 050 9 25 33%lfi2% 32% -% 
RtadwS 1.40 18 1863 55% S3% 54% +% 

RbNU« 012 16 23 6 7% 6 r& 

nxflSHSk 0^40 4 893 17% 17 17% ft 

RonewBx 044 Z 1449 15 14> 2 14% -% 

ROSS sir 020 I1 1978 14% 14% 14% 

noKttfed 32 82 »% zft rs% ft 

Rouse 068 55 215 18% 17% 17% ft 

RPM Inc. 056 21 934 19% 18% 18% ft 

RSFh 060 14 102 23% 23 23 

Ryan Forty 122123 7% 8% 6$ ft 


- s - 

Safeco 196 73463 49%448% 48% -1 

snfereon 030 14 86u2D% 19% 19% ft 
StMmbpA 030 28 688 28 27% 27% 

SdUed L 1413073 51$ 51% 51% 
SOSystoi 14 772 1 8% 18 18% -A 

Sete 61155 7 6% 6% ft 

SdtexCp 052 96103 21% tft 20% -1% 

Score Brd 7 620 4% 4% 4% ft 

Seatad 120 42 16 35 34% 34% -1% 

S-jp* 11 7531 25$ 25 25,*, -fj 

SB Cp 018 !5 2051 19% 19 19% +% 

SefeefeB 036 5 200 2% 2% 2% ft 

Satodhs 1.12 14 5 24% 24% 24% -% 

Sequent 91 2408 18% 19% 19% +% 

Sequota 262444 4% 3& 4 +ft 

Sera Tech 9 48 6% d8% 5% 
SeraFrad 18 3 ft 4% 4% 

Swanson 022 17 12 18% 18% 1ft 

SMIed 084 21 4642 30% 28% 29% +% 

SHLSystm 21268 5% S£ 5,*« -A 

Shamna) 28 1 161 18% 17% 17% ft 

StUHttzP . 7 264 8% 7% 7$ ft 

Stara Do 23 124 29% 28 26 ft 

Stare Tdc 3 9 3 d3 3ft 

StaW 038 161308 36 35% 35% -% 

SgmaDeG 21 1004 8 7% B ft 

ssatvBc am 60 201 12% 11% 12 +A 

StaNGp 579433 20 19% 19% +$ 

SUpmi 040 IB 10 12$ 12% 12$ +% 

Sntohfld 38 91 28 27% 27% ft 

SnppieBv 355442 13% 13% 13jJ +A 
SeBwareP II 522 5% 4% 4% ft 

Sana 056 162290 22% 22 22% +% 

sound am 9 977 1B$ 16% 18% ft 

SptogelA 020 31 4090 14$ 14% 14% ft 

SUudeMa 040 17 8175 U40 39 39% +% 

apauee am 9 3io 19% ift left -A 

StcyBI 1 287 1% 1% 1% 

SbplH 352356 23% 22% 22% ft 

StaSD 060 1318311 32% 31% 32% +1% 
Ski Hera 161043 23% 23% 23ft 
StdRegH 068 11 27 17% d17 17 

Stool Tec 008 14 561 14 13% 13**, 

SWdyUSA 020 35 195 9% ft 9% ft 
SUM 145 50 20% 20 20% -% 

smarted 1.10 14 40 22% 22 22% 

SaudflJy 127771 ft S% 6 +% 

Stryker 026 27 660 34 33% 34 ft 

SUfeanD 21 23 14% 14 14 

SontomoB 080 14 TO 23 {J 23J2 23{Z 
Submit Be OM 14 9* 21$ 21% 21$ ft 
SrerairtTa 301395 31% 29% 30& ft 

Sun Spun It 32 4% 4% 4% +% 

Subtle 179705 32% 31% 31 ft ft 

SwffiTm 43 315 42% 42 42% ft 

Sybase he S6 4S92 «a% 48% 48% ft 
SfflBRfec 474525 17% 17% 17% ft 
SyaeBny 040 IB 90 18% 1ft 18% 
Synercom 97 40 5% 4$ 4$ ft 
Synwgen 1 1766 5% 4% 5% +% 
Syndic 62 300 15% 14% IS -% 

SysmSaft 012 IS 1403 13% 13% 13% ft 
System&co 33 742 20% 20,*. SO 1 * ft 
Sydraw 501210 7% 7% 7% 


- T - 

T-CrtSc. 4 134 2% 2% 2% 

TjowePr 052 20 61 B 32% 31% 32% +% 

TBCCp 131230 10 9% 9$ ft 

TCACabto Q44 28 664 23% 23% 23% ft 
TecMMa 12 3930 19 18% 1ft ft 

TeoHtaeh 080 12 78 A6J«043% 46 

TetoNac 17 423137% 26 % 27 +% 

TetO Sys 11 448 16% 16% 16% 

TdCmA 17226924 22% 22% 22% ft 
Tefebt 7 540 4% 4% 4% 

Tateto 34 1957 47% 46% 47% ft 

Tdxnn Cp 001 74 B43 14 13 13% ft 

TtoraTec 67 B91 8% 7$ 8% +% 

TwoPMDB 021 272193 27% 36% 27 ft 

Three Com 78 8376 41% 39$ 40% ft 

n 17 BA 6% 6% ft 

TJht 022 263481 18% 17% 17% ft 
Trioa Ued 5 163 6% 8% 6% 

Tokyo Us 034 33 13 56% 55% *% +$ 

Tom Brown 84 160 12% 12% 12% 

Tapps CD 028281 3523 5% d5% 5% 

TP1 Enter 2 324 4$ 4% 4% 

TansWrU 29 12% 12% 12% ft 

Harwich 1J» ID 58 37% 38% 37% +1 

Trtcara 18 330 ?% 2 2% ft 

TrlmUe 73 405 14% 13$ 1312 +1*4 

TlUttmflhC 1.10 10 62 20 19% 20 *20 

Taongleb 020 12 732 7% 7% 7% ft 

TysFdA 0051791223 23% 23% 23% +% 


-u- 

USHffita OM 16 4S58 46% 45% 45% ft 
IM* 2 1137 4$ d4% 4% ft 

UGUesGs 1JJ2 13 52 16 ift 16 ft 
USTst 200 14 49 101% 60% 61% 

IMtedSt 040 6 26 10% 9% 9% 

UnBog am 13 772 18% 17% 17% -% 

LMtnnx im 24 566 4Slj 44% 44% -% 

US Banco 1-00 91896 24 23% 23% ft 

LE Energy 5 96 4% 3% 3% 

USTOoip 1.12 8 1068 11% 11 11 

Utah Med 14 46 8$ B% ft ft 

UtdTdcv 11 3 51% 51% 51% 

Uta 10 503 3% ft ft 


- V- 

ntoxad 030 37 36 17% 16% 16$ ft 
VnordCek 1221208 28% 26 28% ft 

VwNom 24 969 22% 21% 22% ft 

tor 41 682 26% 25% 26% +% 

tontfa 10 57 16% 1612 16% 

VtawtoBh 31* 1497 22% 21% 22 

VLSI Tech 28 5879 12ft 12% 12$ +% 

IMwB 01717 121 16% 18% 1B% +% 


- w - 

Werner En OIO 19 900 25)2 24% 24% -1 

warmtech 95 52 5% 5{i 5% ft 

WtoMUSBOTG 61096 17%017% 17% 
WashFMSL OB4 7 BOS I7%tf17% 17% ft 
HWblndA 022 101067 25 24% 24% ft 

Wausau PM OM 15 771 25% 24% 25 

WHO 240 16 60 43% 42% 43% +% 

Wfltak 4 23 3$ ft 3% ft 

WatoOne orn 11 379 28% 2fl% zaA +A 

WtoamBnc 068 26 24 31% 31 31% -% 

WtoPito 10 533 12% 11$ 12 ft 

WttDSUt 2 153 15% 15 15 -% 

WaSfldA 11 BB 3% 3% 3% ft 

imrato a« 22 277 45% 44% 45% ft 

■msSonara 682540 31% 29% 30% -1% 
WatoheoL 028 14 47 18% 1B% Ift ft 
Wftigt 040 271444 22% 21% 21% ft 
WP Group OJQ 21 5M 3% ft ft 
WyattVG(hO40 1 MB 5$ 5% 5% 


"X-Y-Z- 

XMtt 371477 57% 5ft 57% ft 

XanaCwp 1 381 2% 2% 2% ft 

Yelw DM1722195 ift IS 19 ft 

ttrkR901 100 345 4 3% 4 ft 

ZMSUtah 120 9 31 37% 37% 37% ft 






40 


FINANCIAL TIMES 



AMERICA 


Early Dow 
gain pared as 
bonds turn 


Wall Street 


US share prices climbed early 
yesterday following the release 
of good inflation, data, before 
falling back as the gains in 
bond market prices turned flat, 
tcntes Lisa Bransien in New 
York. 

By 1pm the Dow Jones 
Industrial Average was up 
11.78 at 3843.53. The more 
broadly based Standard & 
Poor's 500 put on 0.9 at 46&30. 
while the American Stock 
Exchange composite eased OS9 
to 450.26 and the Nasdaq com- 
posite was off 0.1 at 767.15. 
Trading volume on the NYSE 
was 165m shares. 

Producer price index figures 
declined 05 per cent in Octo- 
ber, exactly matching Septem- 
ber’s number - most analysts 
were expecting a 0.1 per cent 
increase. 

However, few economists 
wavered from their forecasts 
that the Federal Reserve would 
tighten monetary policy by 
raising interest rates by at 


NYSE volume 

Oaity (mfflion) 

400 - — 


350 


300 


250 


200 



2 3 4 7 8 9 
ISM N0V 


least 50 basis points at next 
Tuesday's open market com- 
mittee meeting. Analysts said 
that the positive PPI figures 
decreased the likelihood that 
the Fed would make the 100-ba- 
sis-point increase that some 
had been anticipating. 

Markets were relatively 
steady, following Wednesday's 
volatile session which was 
spurred by uncertainties 
regarding the economic impact 
of Republican victories in con- 
gressional elections. 

Late in the morning session 
the Dow had risen by nearly 25 
points as the 30-year Treasury 
bond rose, but declined as the 
long bond fell bade to its early 
morning prices and the dollar 
fell to its late Wednesday price 
against the Japanese yen. 

Sears, Roebuck shares 
jumped 82 % at 851% after the 
retailer announced its inten- 
tion to spin off its 80 per cent 
stake in the insurance subsid- 
iary Allstate next year. Under 
this plan. Sears shareholders 
would receive approximately 
one share in Allstate for each 
Sears share presently held. 
Allstate shares declined $% at 
824% on the news. 


S Africa in modest loss 


Equities in Johannesburg lost 
momentum as a modest gain 
in golds was offset by profit- 
taking among industrials. 

The industrials index 
slipped 5 to 6,774, while 
steadier bullion prices helped 
the gold shares index to a 
7-point rise at 2,170. The over- 
all index eased 1 to 5,848. 

South African Breweries 
was a feature among indus- 
trial shares, retreating S2.25 
to R9950 In spite at reporting 
a 20 per cent increase in prof- 


its for the half year to the end 
of September. 

Tiger Oats, the agriculture 
and foods group, shed 50 cents 
to R4&50 after reporting a 3 
per cent advance in earnings 
per share in the year to end- 
September. 

Nedcor, the banking group, 
rose to a new 1994 high of 
R37.75, up R1.75, after report- 
ing a 23 per cent expansion in 
earnings. De Beers put on 60 
cents at R99.50 and Anglos 
lost 75 cents at R243. 


EUROPE 


US data put bourses back on upgrade 



Friday November If 


Academic 


Shares in US computer-chip 
makers declined after an indus- 
try report, issued late on 
Wednesday, indicated that sec- 
tor growth for October was not 
as strong as many analysts had 
predicted. The industry bell- 
wether Intel, traded on the 
Nasdaq, dropped S% at S60%, 
Texas Instruments lost 82 at 
$76% and National Semicon- 
ductor fell $% at S17%. 

Telfifonos de Mexico declined 
sharply as analysts down- 
graded their ratings for the 
telephone company after 
Wednesday's announcement 
that AT&T would team up 
with the Mexican industrial 
group, Alfa, to provide long 
distance service. By midday, 
Telmex ADRs were down 82% 
at 883%. 

Greyhound Lines shares fell 
to S2fr on news that the 
beleaguered bus company had 
rejected a new reorganisation 
proposal from its bondholders. 

Shares in Caterpillar gained 
slightly, up 8% at $58% after 
announcing on Wednesday 
that it would increase prices of 
North American mariitnps and 
engines. Analysts repeated 
“buy” ratings for the company 
yesterday morning on the basis 
of the price increases and a 
November 17 analyst meeting 
which is expected to yield posi- 
tive reports on earnings. 

Canada 

Toronto stocks continued to 
languish at lower leve ls in mid- 
day trading. The TSE 300 com- 
posite index had lost 8.00 to 
4,183.38 in turnover of 
C8346.72m. 

The off and gas group was off 
31.71 at 4595.07 despite a recov- 
ery in oil futures. Talisman 
Energy dropped C8% to C$28 in 
volume of l.Q2m shares. 

Mexico 

There was heavy selling tax Tel- 
mex stock after a number of 
brokers downgraded the issue 
following news that AT&T, of 
the US, was to form a 81bn 
Joint venture with Gnipo Alfa, 
an industrial group, to compete 
on long-distance routes. Ana- 
lysts said that the announce- 
ment left Telmex without a US 
partner. 

In New York Telmex ADRs 
were off $1% at 854%, while the 
locally traded “L” shares were 
down 5 per cent. 

Grupo Carso, which owns a 
controlling stake in Telmex, 
declined 3J7 per cent 

Brazil 

Equities in SSo Paulo rose 22 
per cent in light midsession 
trade after a strong rally on 
Wednesday. 

The Bovespa index was up 
1,066 at 49,916 by 1 pm in turn- 
over of R$160.to ($191 .6m). 

Telebras moved forward 25 
per cent to Rf4350. 


After their enthusiastic 
reaction to the US election 
results, bourses pulled back a 
little yesterday morning, as if 
they had decided to wait for 
next Tuesday’s FOMC meeting 
and the forecast rise in US 
interest rates, writes Our Mar- 
kets Staff. 

However, the atmosphere 
changed with the fall of 05 per 
cent in the US producer price 
index in October, following a 
similar drop in September. “It 
is the first back-to-back fall in 
PPI that we have had in three 
years,” said Mr John Blackley 
at James Capel yesterday. 
Capel's economists were still 
looking for a US rate increase 
next week, he added, but there 
was now a feeling that maybe 
50 basis points would be 
enough. 

FRANEFTJRT’s Dax index 
moved from a session’s fall of 
14.07 at 2,082.40, through a 
post-bourse low of around 2.076 
to an Ibis-indicated close of 
2.098.04. Turnover fell from 
DMBbn to DM5.7bn. 

The main impetus for the 
afternoon upsurge came from 
traders who had to cover their 
short positions earlier in the 
week; some of them were tak- 
ing a positive attitude to the 
market by the end of the day. 

Financials did well. Allianz 
and Deutsche Bank showing 
gains of DM28 to DM2,408 and 
DMB.70 to DM75950 at the end 
of Ibis trading. Cyclicals were 
muted or worse, Linde, the 


ASIA PACIFIC 


Sa$ 383 SS 


esnSui 


“dices 


Nov 1C 
Horny cImiv b 


Opai 


10 30 11.00 


THE EUROPEAN SERIES 
irxn 1300 i4.ao 15.00 ose 


FT-SE Eorotra* 100 
FT-SE Euretrack 300 


1340.01 1340 09 1340 59 1339.67 133953 1340.73 1344 £4 134552 

1401.21 1401.14 140235 140152 1401 34 1401.62 140&S7 140553 


Nov 9 


Now 8 


Hov 7 


Nov 4 


Nov 3 


FT-SE Euotack 100 1345.14 132129 1322.66 1333.72 132553 

FT-SE Ewotrack 200 1408L36 138*52 138899 139555 138356 

Baa ion as tem ioo - imibs a» - 1«7 si lomv iao - imsi an - umjs t p km 


engineer, falling DM20.50 to 
DM895. 

Results news was good for 
Veba. where a 49 per cent jump 
in profits took the energy 
based group up DM8.80 to 
DM522, but bad for Siemens, 
although it recovered to close 
just 40 pfennigs down at DM625 
after hours. Meanwhile, Ger- 
man newspapers picked up a 
dated but derogatory story 
from the US on Sobering's 
BetaSeron prospects, and the 
pharmaceuticals group 
dropped DM18.50 to DM960.50. 

PARIS remained firm in 
spite of falling back slightly at 
the dose. The CAC40 added 
4.49 at 1,948.35 in turnover of 
some FFr4bn. 

French financial markets 
will be closed today for the 
Armistice Day holiday. 

Carrefour, the retailer, went 
against the trend, losing 
FFr127 or 5 per cent at 
FFr2,171, as speculation 
mounted that a report damag- 
ing to the group was to be pub- 
lished in one of the domestic 
newspapers during the session. 


In the event no such article 
appeared and the company 
said that it planned to ask the 
stock market authorities to 
investigate the fall in the share 
price. 

Eurotunnel advanced 2 per 
cent to FFr2035 in very high 
volume as local investors took 
up positions ahead of the offi- 
cial opening of the Channel 
tunnel to Care paying rail pas- 
sengers on Monday. 

ZURICH talked about 
switches as the SMI index 
closed 12.3 higher at 2.602.7. 
Swiss Re registered rose SFr26 
to SFr763 ahead of an analysts' 
meeting with the company and 
Zurich Insurance balanced 
this, to an extent, with a fall of 
SFrij to SFrl.235. 

Similarly, pharmaceuticals 
dealers said that investors 
were moving into Ciba and 
Sandoz. up SFrl5 to SFr764 and 
SFr6 to SFr667 respectively, 
and out of Roche certificates, 
which fell SFi55 to SFr5,890. 

AMSTERDAM retreated as 
overall activity was affected by 
weakness in Royal Dutch after 


the oil group reported its third- 
quarter results. The AEX index 
dipped 0.50 to 410.74. 

Royal Dutch left analysts 
with contrasting views. There 
were some who considered that 
operating income was below 
expectations, while others, 
such as James Capel. believed 
that they were - p re tty solid”. 
Nevertheless, the view of the 
Dutch investor was to sell an 
the day, and the shares lost 
FI 2.30 at FI 189.00. 

Lehman Brothers com- 
mented eariipr this week that 
it was maintaining its over- 
weight position in Dutch equi- 
ties on the hagfe that the qual- 
ity of earnings and dividend 
growth made the market 
attractive relative to markets 
fiiirh as Germany, Reiginm or 
Italy. 

The one major worry decid- 
ing the horizon, said Lehman, 
remained the market's historic 
exposure to the US. -Of the 
main nine European equity 
markets, the Dutch would be 
the most vulnerable to the 
expected correction in US 
equity prices.” 

MILAN was supported by 
domestic strength in bonds as 
well as external factors which 
helped the Comit index to a 
gain of 5.28 at 636.17. 

Cir saw one of the best per- 
formances, rising L77 to LI ,932, 
with rumours continuing that 
the group might soon dispose 
of one of its assets. 

In the insurance sector. Fon- 


diaria impressed with a gain of 
L420 to 131,720 amid various 
reports that the company 
wright lanwffh an offer for the 
10 per cent of its subsidiary 
Fomfiarxa Assicuraziani that it 
did not already own. 

Credito Romagnolo added 
L290 at L16£00 on speculation 
that Cariplo, the savings hank, 
mi ght lqrmrh a counteroffer to 
the bid announced by Credito 
Xtaliano, up L33 at Ll,659. 
Ambroveneto, which is also 
subject to a takeover hid from 
BCL Ml L65 to L4#5. while 
the predator gained L5Q at 
L3J535. 

MAimro came back from, a 
day's holiday and reflected two 
days of gains: the general 
index, covering the two-day 
period, rose 5.49 or L9 per cent 
to 299154; the Ibex, real-time 
inrim traded in Barcelona and 
Valencia on Wednesday, 
showed a one-day rise of 25.12 
or 0.8 per cent at 3 , 2 32 . 2 9. 

Turnover was Pta36.4bn. 
Ranks, weak in the morning, 
were no better than mixed at 
the end of the day, and ADR 
stocks were only a little better 
than that, on average. The most 
sizeable gains came from the 
construction sector, which has 
tended to exaggerate senti- 
ment: Cubiartas moved ahead 
Pta450 to Pta8,750, FCC Pta560 
to P brt 2 ,790 and Hoarte PtafiS 
to Ptal,46a 

Written and edited by WflHam 
Cochr ane and John Rtt 



to UBS 


By tot Rodger hi zatteh . ^ . 

Investors have tracked- the 
proxy battle over the fitffoeef 
Union Bank of Sw iteerUm d 
plainly through fits inonhun 
on toe registered shares £& . 
five to the bearers. ' Vv 
UBS. directors axe seektug- 

fiftarwlinMer . approval tO'COJl- . 
vert the registered toto fiedr- 
ers at an EGM on NtfwaHfer- 
22. Therefore, the pretohuh 
should disappear if the direc- 
tors carry toe day.' ■. 

Since Septembor. *8, rtea 
the plan was announced^ tl y 
premium has dropped fnnn 84 : 
per cant to around IS pa cod. 
But fids week, it has moved 

back up above 16 per cent 
On Tuesday, two Zurkh aca- 
deraics, Mr Matthias Bender 
and Mr Martin Janssen, 


ijao ' 



Nikkei affected by losses in privatised issues 



Tokyo 


Broadly based selling 
depressed equities as a decline 
in speculative stocks and pri- 
vatised issues prompted arbi- 
trage-linked sales, lorifes 
Emiko Terazono in Tokyo. 

The Nikkei 225 average 
ended 159.03 lower at 19,264.85 
after a day's high of 19.456.69 
and low of 19,238.05. Arbitrage 
selling and stop-loss sales 
absorbed index-linked buying 
by trust funds. Individual 
investors who had bought 
Stocks On marg in at their highs 
in June started to liquidate 
their positions before the six- 
month margin settlements in 
December. 

The Topix index of all first 
section stocks fell 13.25 to 
1,520.03 and the Nikkei 300 
sank 2.43 to 278.40. Losers led 
gainers by 737 to 224, with 201 
issues unchanged. But In Lon- 
don the ISE/Nikkei 50 index 
added 2.85 at U51.81. 

Continued declines in priva- 
tised issues also worried inves- 
tors. Traders said sentiment 
was worse than indicated by 
the Nikkei's declines. While 
the Nikkei 225 was still above 
the March 31 level of 19.11L92, 
the Topix index had now 
stayed below the last fiscal 
year's dose for four consecu- 
tive days. 

Volume totalled 292m shares, 
against 296m. Foreign inves- 
tors remained inactive, while 
public fluids. expected to sup- 
port share prices below 19,000 
on the Nikkei, were also 
absent. 

Japan Tobacco lost Y27JXJ0 
or 2.7 per cent at Y967.000 and 
Nippon Telegraph and Tele- 
phone slipped Y12,000 to 
Y851.00Q cm foreign selling. 

Speculative shares bought on 

the pachinkO, Or pinhaTI, fhflTflg 

plunged. Nakabayashi, the 
office equipment maker, fell 
Y27 to Y893 and Sailor Pen 
dropped Y1Q0 to Y734. 

Konami, a video game soft- 
ware company, plummeted 
Y490 or 17 per cent to Y2,010 
after it announced that it was 
expecting a net loss of Y14.5bn 


for the current business year. 

Brokers were lower, 
reflecting the current stagna- 
tion in the stock market. 
Nomura Securities dipped Y7G 
to YL860 and Nikko Securities 
Y40 to Y1.040. 

Some electricals were higher. 
Mitsubishi Electric rose Y5 to 
Y70G and Toshiba Y3 to Y722. 

In Osaka, the OSE average 
declined 136.11 to 21,329.25 in 
volume of 17.8m shares. Aoy- 
ama Trading, a discount suit 
retailer, retreated Y400 to 
Y2J500 after reporting a decline 
in profits for the six months to 
September. 

Roundup 

The Pacific Rim region 
remained generally nervous 
ahead of an expected increase 
in US interest rates next week. 
Colombo was closed for trading 
due to a curfew declared in Sri 
Tanka to avert post-poll vio- 
lence after Wednesday's presi- 
dential election. 

SYDNEY declined on off- 
shore selling of leading 
resources shares as profits 
were taken following a strong 
rally in recent months. The AQ 
Ordinaries index slipped 1L3 to 
1£7L3, in turnover of A$49Qm. 

Economic data which 
showed the October unemploy- 
ment level at a three-year low 
lifted prices for a time, but sell- 
ing pressure was renewed dur- 
ing the afternoon. 

In the mining sector, CRA 
weakened 16 cents to A$1R20, 
WMC was down 24 cents at 
A86.88 and MIM receded 9 
cents to A82.64. 

HONG KONG drifted lower 
as most investors remained 
absent in anticipation of a 
further rise in US interest rates 
next week. 

The Hang Seng inApix ahwi 
14.72 to 9,390.76 on turnover of 
HK$1.7bn, compared with 
HK$2.08bn on Wednesday. 

Some dealers noted futures- 
led arbitrage selling by institu- 
tions, helping to dampen the 
price erf Hong Rn-ng Telecom, 
which fell 20 cents to HK815.65. 

Brokers also commented that 
there was same buying interest 


FT-ACTUAR1ES WORLD INDICES 


•Jolntty compand toy The FhKH Times IM, Goldman. Sachs & Co. and NatWest Secuittas Ltd In oon t uncBon wfth tha Institute of Actuaries and the Faaity of Actuaries 
NATIONAL AND 

FUMOIML MARKETS WEDNESDAY NOVEMBBt 9 1994 TUESDAY NOVEMBER 8 1984 DOLLAR INDEX- 


ngunas In penrthaMe 
show number or 8ms 
ol stock 

US 

Drtar 

Index 

Day's 

Change 

tt 

Pound 

Staring 

Index 

Van 

Index 

DM 

Index 

Local 

Currency 

Index 

Local 
% che 
on day 

Grosa 

Dtv. 

Yield 

US 

Dollar 

Max 

Pound 

Starting 

Iri-lau 

HUfiX 

Yen 

index 

Local 

DM Currency 52 week 52 week 
Index Index High Low 

ago 

tapp«»0 

Austrato (08) 

17124 

12 

16822 

10626 

13321 

160.72 

02 

3.70 

159.11 

15422 

10370 

132.74 

14332 

18316 

14926 

154.46 

Austria (16) 

182.68 

-02 

169.08 

113.04 

14346 

14337 

19 

1.11 

18345 

10306 

11248 

14320 

14388 

19389 

16748 

175.82 

B4SIW1P5} 

18387 

-02 

15524 

10428 

134.17 

13024 

07 

422 

16025 

15332 

10386 

13307 

13090 

177.04 

16060 

150.72 

HrazU 

184.71 

12 

17377 

114.16 

14392 

282.19 

1.1 

0.73 

18224 

18722 

11123 

14327 

27995 

_ 

- 

_ 

Canaria (103) 

13225 

-02 

12224 

82.00 

10521 

12923 

-02 

ZB2 

132.00 

121.75 

8149 

10421 

13028 

14521 

12024 

13428 


24429 

-02 

22524 

151.07 

19429 

18920 

0.4 

1-49 

84380 

22521 

15121 

18356 

19847 

27379 

23027 

23313 

Rntand (24) 

19227 

05 

17728 

11821 

15322 

18921 

12 

074 

19124 

17528 

11728 

15018 

18796 

201.41 

11385 

121 28 

FrtJfrce (101) 

171-20 

-02 

15328 

10322 

13317 

14124 

1.1 

397 

171.68 

15727 

10327 

134.75 

13828 

18527 

15924 

162.72 

Garmany (58) — 

... —.14381 

02 

13329 

8922 

11319 

11319 

12 

120 

14495 

13126 

8333 

11308 

11306 

15040 

12827 

13025 

Hong Kong (58) 

38126 

-02 

3S229 

23374 

303.35 

37340 

-02 

318 

382.16 

35010 

23424 

29926 

37921 

50358 

341.29 

36311 

Ireland (14) 

207^48 

-0l8 

19121 

12824 

18302 

18345 

02 

341 

20922 

191.76 

12825 

16429 

18427 

216.60 

172.05 

17591 

Italy (59) _ _ 

7720 

02 

7125 

4720 

8124 

9026 

31 

1.73 

7621 

7048 

47.16 

6027 

88.11 

97.78 

57.68 

6224 


15722 

-12 

14345 

8724 

12314 

9724 

-1.1 

0.79 

16024 

14389 

9622 

12S9S 

9332 

17010 

12494 

14490 

Malaysia (97) 

51319 

-0.1 

4772S 

31928 

41020 

50374 

oo 

1.85 

51828 

47313 

31629 

40526 

50370 

621.63 

43071 

48192 

Maxtco CIS) 

215521 

02 

1982.66 

133229 

171429 

807427 

02 

127 

215129 

1971.14 

131928 

168820 

8065.13 

2847.06 

169628 

1757.77 

Nathariend (19)_ 

21725 

-0.4 

20123 

13424 

173.13 

17029 

02 

329 

21353 

20019 

13490 

17122 

16822 

22330 

18791 

10380 

Now Zealand (14) 

7528 

-02 

7022 

4826 

8042 

64.76 

-02 

4.45 

73*0 

6820 

4385 

59.97 

8620 

7729 

5022 

6312 

Norway (23) 

19378 

02 

18377 

122.87 

15311 

18034 

12 

123 

19822 

18128 

12121 

15525 

17749 

211.74 

18522 

177.15 

8ki0apom(44) 

39722 

1.1 

38720 

24528 

31823 

28314 

12 

127 

39350 

36057 

24125 

30823 

265.72 

40128 

294.66 

304.16 

South Africa (69) 

33920 

31 

31328 

209.88 

27025 

30016 

07 

2.13 

339.14 

31020 

207.90 

266.18 

29720 

34290 

20625 

211.06 

Spain (38) 

14028 

-Q.1 

12927 

8390 

11122 

13521 

12 

420 

140.71 

12820 

8328 

11044 

134.13 

156.79 

12368 

137