Sunday newspaper round-up: Resolution, Friends Provident, Lloyds

12th Jul 2009 10:55

The insurance tycoon Clive Cowdery has tabled a proposal to merge Friends Provident, the £1.4bn pension and life company, with his quoted investment vehicle Resolution.If the deal is successful, it could trigger the start of the long-awaited consolidation in the sector. Cowdery is understood to have written a letter to Sir Adrian Montague, chairman of Friends Provident, setting out the terms of an all-share deal. It is thought to place a small premium on Friends Provident's shares, which closed on Friday at 60p per share, the Sunday Times reports.The Telegraph adds that Friends Provident is tomorrow expected to reject the takeover approach. The all-share offer from Resolution is understood to have been tabled in the last few days, but the move has not been well-received by Friends Provident's board.Lloyds Banking is poised to write off as much as £13bn on its loans to commercial property, businesses and mortgage holders as the crisis engulfing the taxpayer-backed bank deepens. First-half results due to be posted in three weeks will show that its losses are accelerating.UBS analysts expect Lloyds to announce a bottom line half-year loss of £6.3bn as a result of the soaring provisions, the Sunday Times reports.Willie Walsh, the embattled chief executive of British Airways, has secured shareholder backing for an emergency rights issue to secure the airline's survival. Walsh sounded out a dozen of BA's largest institutional investors about raising capital at a meeting held at the offices of its broker, Merrill Lynch, at the end of last month. Analysts said that BA could be forced to tap the market for £500m unless passenger numbers recover soon to shore up its creaking balance sheet, the Observer reports. Meanwhile, the fund manager running British Airways' troubled pension fund received a pay rise of nearly £200,000 last year, giving her a bigger wage than the airline's finance director. Companies House documents show Michelle McGregor Smith, chief executive of British Airways Pension Investment Management, saw her pay rise from £353,909 in the 2006-07 financial year to £514,254 in 2007-08. Last year, Keith Williams, BA's finance director, received a basic salary of £434,000. Willie Walsh, the chief executive, got £726,000, the Sunday Times reports.Executives at Jaguar Land Rover, the Midlands carmaker, are drawing up plans for an extended shutdown of its UK plants and a new round of staff layoffs as it struggles to cope with the slump in the world car market. Preparation for the closures comes just days after the company released its new flagship, the latest version of the Jaguar XJ beloved by prime ministers and top British executives, the Sunday Times reports.Sir David Walker, the City grandee tasked with reforming corporate governance standards at Britain's banks will this week set out plans for directors to receive formal training and annual re-election to the boards of financial institutions. Walker, who was asked to review bank governance by Alistair Darling, the Chancellor, will publish a series of recommendations on Thursday that will pave the way for an overhaul of boardroom practices, the Sunday Telegraph reports.Pirc, the investor action group that last week tried to force the early resignation of the Marks & Spencer's chairman, has formed 100 subsidiaries to launch assaults on other quoted groups. Each vehicle will own a single share in the target groups, giving the necessary base to plant resolutions at annual shareholder meetings, the Sunday Independent writes.Centrica is this week expected to take its £1.3bn offer for Venture Production directly to the company's shareholders. The move comes after Venture Production rejected Centrica's 845p-a-share offer, which was announced to the market on Friday evening, the Sunday Telegraph reports.Sam Laidlaw, the chief executive at FTSE 100 energy giant Centrica, has vowed that his £1.3bn hostile bid for North Sea oil and gas group Venture Production will stabilise prices for its 10m households, adds the Sunday Independent.Britain is the world's only leading economy unable to budget for any kind of economic rescue package next year, the International Monetary Fund has warned. In calculations that will spark further criticism over the state of the public finances, an IMF paper presented to world's leaders has laid bare how the UK's indebtedness has left it unable to provide the vital stimulus the economy could need over the next 18 months, the Telegraph reports.McDonald's, the fast food giant, will join the ranks of companies quitting the UK when it moves its European headquarters to Geneva later this year. Senior executives, including Denis Hennequin, president of McDonald's operations in Europe, will be based there, the Sunday Telegraph reports.The Phoenix Four business executives who bought MG Rover from BMW in 2000 have received a further £3.5m in dividends and share payments in the four years since its collapse. The cash has come from their investment in MGR Capital, a car finance joint venture with a subsidiary of banking group HBOS, now part of Lloyds TSB, the Observer writes.