Thursday newspaper round-up: Glencore, Southern Cross, Morrisons

2nd Jun 2011 06:06

Newly listed commodities trader Glencore has been barred from borrowing from the European Investment Bank (EIB) because of "serious concerns" about how the company is run. The bank, the lending arm of the EU, yesterday said it had frozen all new loans to the Switzerland-based group which floated in London last month with a £36billion price tag that catapulted it straight into the FTSE 100, reports the Daily Express.Social services are poised to step in to protect the welfare of elderly people paying their own way in homes run by the embattled Southern Cross chain. As central and local government moved to quell rising anxiety over the future of Southern Cross's 750 care homes, and the 31,000 people who live in them, a social services leader gave the first assurance that councils would go beyond their strict, statutory responsibility only to publicly-funded residents, reports the Guardian.Supermarket giant Morrisons has come under fire from Britain's leading investor body over plans to gift shares to a key executive worth 230% of his base salary. The Association of British Insurers, which represents big City investors, has issued an 'amber-top' alert to its members over a pay proposal which may breach best UK corporate governance practice. Britain's fourth-largest grocer offered finance director Richard Pennycook shares worth £1.25m, assuming certain criteria are met, as a sweetener to prevent him from leaving, the Daily Mail reports.Oberthur Technologies declared yesterday that it had no intention of relaunching a takeover bid for its British banknote printing rival De La Rue. But its simultaneous announcement that it had appointed De La Rue's former boss as an adviser sparked speculation that the bid will, at some stage, be back on, the Times reports.BDO has become the first firm to be censured by the City regulator for failures in its role as sponsor of a UK-listed company. The Financial Services Authority said that the accountancy and advisory group did not handle correctly an acquisition by its client Shore Capital, a boutique investment bank, of Puma Brandenburg, a German property group, reports the Times.German ministers were forced to reassure the market that the European Union and the International Monetary Fund would stick together to bail-out Greece, amid renewed speculation that the €110bn (£96.7bn) rescue mission is close to collapse. Martin Kotthous, from the German finance ministry, emphasised that the bail-out was a "joint programme" between the EU and IMF, according to the Daily Telegraph.Britain's banks have emerged as by far the largest buyers of Government debt in the last six months, as demand from other UK investors and foreign buyers fell away. Banks bought 91% of the £39.8bn of net issuance of new gilts with purchases totalling £36.1bn, compared to the £11.4bn of UK debt bought in the preceding six months, says the Daily Telegraph.A medical devices group developing non-tobacco nicotine delivery systems has won the backing of Sir Terry Leahy in the latest private investment by the former Tesco chief executive since he retired in March. Sir Terry has put an undisclosed sum behind Kind Consumer, a start-up that will announce on Thursday a commercial partnership with Nicoventures, a subsidiary of British American Tobacco devoted to the marketing and sale of non-tobacco consumer products, the Financial Times reports.The backlash against the Chancellor's decision to impose higher taxes on energy firms continued yesterday after Centrica decided not to recommence production at a major gas field, citing the heavy tax burden. The owner of British Gas said it had completed the planned maintenance on its South Morecambe gas field, but that it now expected it to "operate on a more intermittent basis", reports the Independent. Ryanair is set to allow customers on all its flights to reserve seats, the no-frills carrier has told The Independent. In a radical departure from usual practice, the airline said trials of a €10 "book-a-seat" service between Dublin and Gatwick and Dublin and Malaga launched last month had proved to be far more successful than expected, the paper says.---RG