Wednesday newspaper round-up: BP, Barclays, WPP

3rd Jun 2009 06:13

BP is preparing to shut its $18bn (£11bn) UK final salary pension scheme to new members, in the latest blow to generous retirement provision for Britain's workforce. BP was one of the few FTSE 100 blue-chip companies to maintain a final salary scheme for new recruits, the Times reports. Hugh Osmond's Pearl Group has finalised a deal to cut the life assurer's £3bn debt load and get a £500m capital injection from a new investor, Liberty Acquisition Holdings, after weeks of negotiations. Liberty, a Cayman Islands-based "blank-cheque" company formed specifically to look for acquisitions, is expected to announce on Wednesday it has entered a period of exclusivity to close the deal, which will see it take a stake of about 60%, reports the FT.Lending to British companies and individuals fell during April, data published yesterday revealed, suggesting that the Bank of England's programme of quantitative easing may have had little impact to date. The Bank revealed that lending to "private nonfinancial corporations" - the business sector apart from the banks - fell by £4.7 billion in April. This was the biggest monthly decrease since records began more than a decade ago, the Times reports.Ryanair vowed to provoke an air fares price war as it dived to its first full-year loss in 20 years and playfully suggested it could bid for German carrier Lufthansa, reports the Telegraph.The UK financial services watchdog has roughly doubled its fees for the biggest retail and investment banks, an even greater increase than expected, after bowing to pressure from small financial advisers for less swingeing rises. The Financial Services Authority is lifting the overall cost of policing the industry by 35.8 per cent to £435.5m ($722.3m), reports the FT.A Chengdu-based machinery company is close to clinching a deal to buy General Motors' (GM) Hummer brand, making it the first Chinese company to own an American car-maker. Sichuan Tengzhong Heavy Industrial Machinery Company is expected to spend between $150m (£90m) and $250m on Hummer, the gas-guzzling brand of sports utility vehicles popularised by Arnold Schwarzenegger before he embraced the environment, reports the Times.Nearly a quarter of WPP shareholders failed to back the bonus scheme that could net the advertising giant's chief executive Sir Martin Sorrell $95m (£57m) over the next five years, reports the Independent.The former Vodafone chief executive Arun Sarin walked away from the group with £8m last summer, gained through his pay and incentive schemes. Mr Sarin, chief executive of the mobile telecoms giant for five years, left in July. The sum included a £500,000 "relocation payment" to help Mr Sarin, a Californian by birth, move back to the US when he left, reports the Independent. LDV, the vanmaker, reapplied for administration yesterday in a move that raises questions about its owner's relationship with a consortium seeking control of Vauxhall. Nearly 850 jobs are under threat at LDV along with a further 5,000 at suppliers and manufacturers after the failure of rescue talks with Weststar, a Malaysian vehicle maker, the Times says. Abu Dhabi's rescue investment in Barclays was being called the punt of the decade yesterday as the Gulf state appeared to be on track to make a profit of at least £2 billion on the deal after only eight months. On top of a £1.45bn profit made on its exit from convertible notes in the bank yesterday, Abu Dhabi is close to clinching a gain on £1.5bn of high-yielding reserve capital instruments in Barclays, which it also plans to sell, the Times writes.Abu-Dhabi's retreat from Barclays Bank is a warning sign that sophisticated investors in the Gulf think the rally in global equities is starting to look mature, adds the Telegraph. As a result, they have begun to rotate out of "risk assets" into more defensive positions. A senior manager for a Gulf fund said the shift away from Western banks was largely a tactical play. "They'll come back when shares are cheaper again, perhaps much cheaper. They are not fools," he said.