Sunday newspaper round-up: BP, Prudential, Goldman Sachs

2nd May 2010 10:43

President Barack Obama will visit the Gulf of Mexico coastline threatened by the giant oil spill, as experts warn that the spill from a ruptured oil rig might be growing five times faster than previously estimated. The oil is gushing from BP's sunker Deepwater Horizon rig at 25,000 barrels a day and could reach 50,000 barrels a day according to the National Oceanic and Atmospheric Administration. Earlier estimates had put the leak at 5,000 barrels a day, the Sunday Times reports.The paper also reports that BP faces fresh questions over the cause of the Gulf of Mexico oil spill after it emerged that problems with the type of equipment that led to the disaster were first reported a decade ago. In June 2000, the oil giant issued a "notice of default" to Transocean, the operator of the rig that blew up last month. The dispute was over problems with a blowout preventer, a set of iron slabs that should close out-of-control wells. It failed on the Gulf of Mexico rig, triggering the explosion and oil spill.BP is facing at least 36 civil claims and the possibility of criminal action over the explosion and oil spillage in the Gulf of Mexico. A spokesman for the energy giant confirmed it had received several notices of legal action, but said it was not aware of a criminal action since the explosion on April 20 in which 11 men were killed, the Sunday Telegraph reports.BP and other oil companies operating in the North Sea have been warned by the Health and Safety Executive (HSE) that they are failing to operate rigs and other offshore equipment to appropriate standards, documents show. The "improvement notices" from the offshore regulator come amid speculation that accident statistics covering the past 12 months show a marked increase in problems over a year earlier, the Observer adds.Prudential is working on radical plans to sell off its British and American businesses in a move that would raise more than £10bn. The giant insurer is plotting the sales as part of its attempted $35.5bn (£23.2bn) takeover of Asian rival AIA, a deal that has drawn fierce criticism from investors. A sale of the group's British business would mean the Pru cutting historic ties ? it started life 160 years ago in London - and fuel speculation that the company will move its headquarters to Asia. City sources say the UK sale could be launched within weeks of the AIA deal being completed in the autumn, the Sunday Times reports.Greece is today expected to finalise the terms of a €120bn (£104bn) rescue loan from governments in the eurozone and the International Monetary Fund. Talks between the Greek government, the IMF and German and French officials ended yesterday. An official announcement on the bailout is expected after a meeting of the Greek cabinet today. Josef Ackermann, chief executive of Deutsche Bank, is co-ordinating a private sector contribution to the package that could raise up to €2bn, the Sunday Times reports.Goldman Sachs, the investment bank at the centre of a criminal investigation into its role in the financial crisis, paid its London staff $5.5bn (£3.6bn) in salary and bonuses last year. The payouts equate to an average of $1m each - almost twice as much as the average pay deal across the rest of the group. The figures, detailed in accounts filed at Companies House late on Friday, come amid continuing criticism of high pay for bankers, the Sunday Times reports.Meanwhile, Warren Buffett has robustly defended Goldman Sachs against the fraud allegations that threaten to engulf the Wall Street giant. The "Sage of Omaha" - speaking publicly for the first time since the Securities and Exchange Commission (SEC) filed civil fraud charges against the investment bank - stressed that he "loves" his $5bn (£3.27bn) stake in the investment bank and branded the Royal Bank of Scotland as "dumb" for losing $900m on the $1bn transaction under scrutiny from civil and criminal investigators, the Sunday Telegraph reports.Capricorn Investment Group, one of the world's biggest family offices, could break its relationship with Goldman Sachs following accusations by the US financial watchdog that the firm misled clients over mortgage trading, the Sunday Independent adds.The owner of Argos and Homebase faces a shareholder backlash over plans to buy back £150m of its shares. Leading institutional investors in Home Retail Group told The Sunday Times the buy-back was a "waste of money" and the company must come up with a strategy to counter the big supermarkets. One of Home Retail's biggest shareholders, who asked not to be named, said: "The company needs to come up with a new plan for Argos. They have done nothing to answer the long-term questions about how they will fend off the competitive threat from the supermarkets," the Sunday Times reports.Mitchells & Butlers, the owner of the All Bar One and Harvester chains, has hired advisers to sell hundreds of pubs in a move that could generate up to £500m for the group. M&B has hired Sapient Corporate Finance, a boutique advisory firm specialising in deals featuring pub and restaurant chains, to find a buyer for its drink-led pubs which include the brands Scream, the Sunday Telegraph reports.British Land and Blackstone, the private equity giant, are preparing a massive refurbishment of Broadgate, the 32-acre estate they co-own in the heart of the City. The revamp will secure the future tenancy of anchor occupier UBS, the investment bank that rents 850,000sqft of office space in six of the estate's buildings for nearly £39m a year, the Sunday Independent reports. Cenkos, the City broker founded by racehorse owner Andy Stewart, is believed to have approached Fairfax, the investment boutique, about a possible takeover. It's thought that Singer Capital, the broker which emerged from the ashes of Kaupthing Singer & Friedlander following the Iceland crisis, has also sounded out parties about the possibility of a deal, the Sunday Independent reports.