Tuesday newspaper round-up: BSkyB, Resolution, BP

15th Jun 2010 06:32

Rupert Murdoch's News Corporation has made a bold approach to take full control of BSkyB, the satellite broadcaster in which it owns a 39% stake.The takeover approach, made last week, valued Sky at around £12bn. It was rebuffed by the Sky board for "deeply undervaluing" the company. One insider said: "There is still a meaningful gap between the two companies in terms of price," the Telegraph reports.Murdoch's approach for the 61 per cent he does not already control valued the company at 675p per share, or £11.6bn, according to people familiar with its terms, compared with a closing price on Monday of 600.5p, the FT adds. That suggests a full bid could cost News Corp more than £7bn, or almost twice as much as its $5.8bn acquisition of Dow Jones in 2007. However, people close to both sides said regulatory hurdles to a formal bid from the majority shareholder would be the biggest obstacle to completing a formal bid. Sir Fred Goodwin has been summoned by the Financial Services Authority to answer questions about Royal Bank of Scotland's management in the run up to its near-collapse in October 2008. The bank's former chief executive is understood to have struck a deal to meet FSA investigators at the office of his lawyers rather than at the regulator's Canary Wharf office in an attempt to avoid publicity. The meeting is planned for today but last night sources said that it could be delayed, the Times reports.Clive Cowdery's Resolution is close to securing a ground-breaking deal to slash investment bank underwriting fees on a rights issue to fund a £2.75 billion acquisition of Axa's UK life business. The Times has learnt that Resolution has devised a new underwriting model with its shareholders ? who include some of Britain's biggest institutional investors ? to act as a co-ordinated group of subunderwriters on a deal, reducing the role of the investment banks.Shares in BP dropped by nearly 10% yesterday after the oil giant refused to make public the conclusions of a scheduled board meeting that had been expected to recommend a suspension of its controversial £1.8bn dividend payments to shareholders. The dividend has been the subject of a transatlantic tussle. BP accounts for about £1 in every £7 of dividends paid out to British shareholders, and any suspension would be a blow to UK pension funds, but pressure is building in Washington for the firm to make a dramatic gesture and prove how seriously it is taking the oil spill from its Deepwater Horizon rig into the Gulf of Mexico, the Independent reports.Jérôme Kerviel, the rogue trader accused of losing almost €5 billion, was denounced by a former boss as criminal, dishonest, disloyal and a cheat at his trial in Paris yesterday. Christophe Mianné, head of Global Markets at Société Générale, the French bank, said that he was "extremely shocked" to hear Mr Kerviel claim that executives had turned a blind eye to his activities, the Times reports.The annual cost to the taxpayer of funding public sector pensions will more than double in the next five years to £4,000 per household, the Office for Budget Responsibility has disclosed. By 2015, almost £10 billion of public money will be spent every year supporting the retirement of millions of public sector employees - up from £4 billion this year, the independent body said. In a speech on Monday, Nick Clegg, the Deputy Prime Minister, said the pensions were simply "not affordable". The pension burden will almost certainly lead to higher taxes or greater cuts to public sector spending, the Telegraph reports.The economy, more damaged by the banking crisis than previously admitted, will grow more weakly and may never fully recover, the new Office for Budget Responsibility (OBR) said yesterday. The conclusion adds billions of pounds to the total that George Osborne must find if he is to restore the public finances to health, the Times reports.Governments which breach European Union budgetary guidelines should have their EU voting rights "suspended" to prevent any resurgence of the debt and euro crisis, France and Germany said last night. In a show of unity after reports of sharp Franco-German divisions on the future governance of the euro, Chancellor Angela Merkel and President Nicolas Sarkozy said that they would put forward common proposals - including amendments to the EU treaties if needed - to punish member states who ignored debt and deficit rules, the Independent reports.AXA analysts dismiss Europe's €750bn (£623bn) rescue package and say eurozone could still disintegrate. Analysts at the French financial group AXA see a serious likelihood that the eurozone will break in half or disintegrate, dismissing Europe's €750bn (£623bn) rescue package for Club Med debtors as a stop-gap measure that misdiagnoses the problem, the Telegraph reports.Investor fears over the financial health of Spain were raised again yesterday amid warnings of funding problems for the country's companies and banks. Government bonds were sold off sharply as the Spanish Treasury secretary and a leading banker admitted companies and banks were having difficulties raising funds, the FT reports.British Airways may be barred from operating domestic flights in America but that has not stopped the airline from offering its wealthier passengers a fresh way of zipping around the US. The UK flag-carrier that is reeling from 22 days of strikes is launching an exclusive private jet service for BA passengers flying within North America and the Caribbean, the Telegraph reports.