Wednesday newspaper round-up: BP, BT, GlaxoSmithKline

14th Jul 2010 06:39

Democratic senators in the US are calling for an investigation into BP's business interests in Libya, accusing the British oil company of being part of a deal to free a convicted terrorist in return for oil licences.BP has faced a slew of Congressional investigations following its catastrophic oil spill in the Gulf of Mexico, the majority of which have centred on its safety record in the US and whether it knowingly cut corners, the FT reports.Taxpayers could be on the hook for between £7.3bn and £22.8bn ($11.1bn-$34.6bn) if BT were to become insolvent and its pension scheme terminated, according to written papers submitted to the High Court on Tuesday. The gulf between the figures illustrates why BT and its scheme trustees and government ministers have not been able to settle a dispute about the extent of the liability that was made public 2006. Mr Justice Mann is being asked to determine the extent of a "Crown guarantee" for the pension scheme, the FT reports.GlaxoSmithKline said yesterday that it had reached a settlement in a lawsuit alleging that the company's blockbuster Avandia diabetes drug can cause heart attacks and strokes. News of the settlement coincided with the start of a two-day meeting at the US Food and Drug Administration to consider whether the drug is too dangerous to stay on the market. GSK refused to confirm a Bloomberg report that it had agreed to pay about $460m (£303m) to resolve about 10,000 suits, out of an estimated 13,000 it is facing, the Times reports.Investors in the London-listed mining company Kazakhmys were not warned of the close ties between its management and Kazakhstan's controversial President before the business was floated five years ago, an influential pressure group has claimed. Global Witness, which monitors corruption in the natural resources industry, said the FTSE 100 copper miner was run by a clique of managers close to President Nursultan Nazarbayev, who has been accused of accepting bribes in return for handing the rights to Kazakh oilfields over to Western companies in the 1990s, the Independent reports.The Royal Bank of Scotland's chief executive, Stephen Hester, dismissed the chances of a new generation of smaller banks that are poised to enter the market against big banks like his. Mr Hester was speaking as Andrew Tyrie, the Conservative chairman of the Treasury Select Committee, announced an investigation into the level of competition in retail banking. Mr Hester said: "We shouldn't kid ourselves. Banking is a mature and capital intensive business. There are very few industries like that where the number of competitors is increasing. It is decreasing," the Telegraph reports.British Airways bosses ran into a storm of protests on Tuesday as the airline's annual meeting was dominated by the striking cabin crew whose industrial action has cost the company almost £150m this year. In a three-hour affair, Willie Walsh, BA chief executive, spoke of his frustration at being depicted as either Hitler or the devil - as crew lined up to accuse the management of "bullying", engendering a culture of "fear and loathing" and "damaging the BA brand" the Telegraph reports.A third of Spain's city councils are in dire straits and may be forced to suspend payments by the end of the year, replicating the woes in the US, where many states are bearing the brunt of fiscal tightening. The great majority of councils in Andalucia are already in deep crisis - either insolvent or muddling through from day to day. More than 400 of the 8,000 councils across the country have stopped paying electricity, water and telephone bills, according to Spanish newspaper El Economista, the Telegraph reports.Intel, the technology bellwether, has unveiled the best results in its 42-year history, sending US stock markets sharply higher. Paul Otellini, chief executive of the California-based company, said: "Strong demand from corporate customers for our most advanced microprocessors helped Intel achieve the best quarter in the company's history." Second-quarter net profits of $2.9bn (£1.9bn) smashed Wall Street analyst expectations, coming against a loss of $398m a year earlier, the Telegraph reports.Ian King, BAE Systems' chief executive, has warned that the Government will be forced pick winners and losers in the defence industry as a result of budget cuts. Britain still has the capability to design and build its own helicopters, tanks, fighter jets, ships, submarines and command and control systems, but budget cuts could threaten the country's ability to finance these projects in the future, the Times reports.Ocado yesterday faced fresh calls to cut the price of its initial public offering, as more analysts said the £1 billion valuation was too high.Clive Black, an analyst at Shore Capital, suggested the company lower its sights for the flotation, saying that he would value the online grocery delivery business at no more than £534m, the Times reports.A property deal secured by British Sky Broadcasting has shed new light on possible incentives for News Corp to take the satellite broadcaster private, media analysts said on Tuesday. Earlier this year, BSkyB paid £57m, which two people close to the company said was a premium to the market value, for the Harrods depot and administration centre that abuts its west London headquarters. The revelation led analysts to conclude that News Corp could view the site, nine miles west of central London and close to the M4 motorway, as an alternative base for its European operations, the FT reports.