Sunday newspaper round-up: Greece, Manchester Utd., France

12th Jun 2011 15:04

A way forward in the Greek crisis? French banks have agreed, in principle, to subscribe to new issues of Greek sovereign debt to replace maturing bonds, rolling over existing commitments, but on condition that all creditors do the same, the Financial Times says. European authorities, however, have yet to decide on which course of action to pursue, a debt roll-over or a re-profiling. One senior banking official cited by the FT has said that a hit for banks from a rollover would be "manageable" but that it remains uncertain how this will affect markets. A group of Eurozone officials is expected to report to EU finance ministers on June 20, in time for final agreement on the Greek package, by EU leaders, at a summit on June 23 and 24. The Economist weighs in this weekend with its own analysis of the Greek crisis, stating that, "Under any realistic assumptions for future growth and interest rates, its stock of debt, at 150% of GDP and rising, is unpayable." Furthermore, it opines, the proposed new European rescue plan does mark progress in addressing Greece's lack of competitiveness, but it achieves no such thing with regards to Greece's other main problem, its insolvency. The magazine thus believes that, "even if the Greeks do everything that is asked of them, another crisis will loom before long." The economics weekly also seems dismissive of the risk of contagion from a Greek debt restructuring to other eurozone countries and warns of the poisonous nature of domestic politics against a background of savage austerity and ever-rising debt. "It's difficult to invest on fundamentals at the moment," said Fred Rizzo of asset manager T.Rowe Price, to the Financial Times' weekend edition (...) "It's all political". "In that knowledge," adds the FT, "some of Britain's biggest fund managers have stepped up their lobbying efforts with government, buttressing the banks' own attempts to persuade George Osborne, chancellor of the exchequer, not to take draconian action that would further damage the investment case for the industry." The newspaper also indicates that, "Clearly, the lobbying is self-serving stuff (...) But it is in the government's interest to keep investors sweet." Sir Roger Carr, Centrica chairman and also president of the confederation of British industry says today, in an interview with The Sunday Telegraph, that," last week's action by the Spanish-owned Scottish utility should not have come as a surprise as wholesale power prices have been rising by more than 20pc," adding that, "In those circumstances, it is just a commercial fact that those things convert into price increases. It's high. Nobody likes higher prices but it's passing on costs which nobody can avoid." Of possible interest, the newspaper adds that critics of last week's Scottish announcement claimed that the portion of energy bills attributable to the carbon emissions mitigation investment amounts to a hidden £200-a year "green tax". "The owners of Manchester United Football Club are considering a £1.7bn relisting of the company's shares, but in Asia this time, rather than London," according to the Sunday Times, as cited by The Independent on Sunday. For the family which owns the club, the Glazers, that sum of money would mean more than doubling the investment that they made in the club in 2005. News that its owners are considering a float may encourage fresh interest from the Red Knights, a consortium of wealthy United fans interested in buying the club. Representatives of the Knights are understood to have toured the Middle East in recent weeks trying to attract financial backing that would allow them to improve their offer.Members of three unions have been voting on whether to take joint action, expected to be held on June 30, in protest at cuts in jobs and pensions and a pay freeze. Up to 750,000 workers could be involved in the strike, making it the biggest day of industrial unrest for years and setting the Government on a fresh collision course with public sector workers. Two teaching unions, the Association of Teachers and Lecturers (ATL), and the National Union of Teachers (NUT), will announce the results of their ballots on Tuesday, reports The Independent on Sunday.An Eastern European agricultural business, Continental Farmers, is to join the Alternative Investment Market (AIM) as part of a major expansion move. The company has built up farming interests across western Ukraine and northern Poland. One of its largest shareholders is another AIM listed outfit, Origin Enterprises, which has around 39% of the company. It is not yet known how much money it is planning to raise. Continental Farmers has plans in place to increase its leasehold land bank in Ukraine to over 50,000 hectares within five years and supplies clients such as Tesco and Sainsbury's, according to Scotland on Sunday.Britons saw the value of their savings eroded by £36bn during the past year as a result of high inflation, according to research from accountants UHY Hacker Young, cited by The Mail on Sunday. Overall, the average return people are getting on their money is just 1.6 per cent, well down on inflation as measured by the retail prices index, which was running at 5.2 per cent in April, the latest month for which figures are available. A basic rate taxpayer needs to earn interest of 5.63 per cent in order to make a real return on their money once CPI inflation and tax are taken into account.AB