Wednesday newspaper round-up: UK mulls Vauxhall bail-out

27th May 2009 06:12

Britain has intervened in the political manoeuvring over the future of Opel/Vauxhall, explicitly linking its financial support for the spin-off of General Motors' European operations to the future of two UK car plants in Luton and Ellesmere Port, reports the FT.Lord Mandelson, business secretary, said he had held "substantial telephone conversations" on Tuesday with Fritz Henderson, GM's chief executive, and Carl-Peter Forster, chief executive of GM Europe, and had "made clear the UK government's commitment to all of Vauxhall's plants". The Times also reports Britain has "not ruled out making a financial contribution" to help save Vauxhall, according to Lord Mandelson. The UK Business Secretary's comments came as Beijing Automotive Industry Corporation (BAIC) was confirmed as a bidder to buy Opel and Vauxhall, the European operations of General Motors. Fiat, Canada's Magna and Belgium's RHJ are the other bidders in the race.Alistair Darling faced fresh embarrassment last night when the Treasury's own survey of economic forecasts contradicted the Chancellor's and raised the possibility of a £70bn hole in the public finances. The survey predicts over the next four years the total borrowing figures will be £679bn. In the Budget Mr Darling said it would be £606bn, meaning the Treasury would need to find another £72.7bn, reports the Telegraph.Royal Dutch Shell cleared the way for a management shake-up under its new chief executive on Tuesday as expectations mounted that Europe's biggest oil company will soon unveil a wide-ranging restructuring. Shell announced the sudden departure of Linda Cook, head of the gas and power division, by "mutual agreement". The news came as Shell's top 200 managers gathered in Berlin for a two-day meeting, at which the company is expected to announce restructuring plans, reports the FT.Sir Terry Leahy, the chief executive of Tesco, took a £370,000 cut in his pay and bonus package last year after the supermarket's fledgling US arm failed to hit certain performance targets. According to Tesco's annual report, sent to shareholders yesterday, Sir Terry's salary, benefits and "performance-related emoluments" for the year to 28 February totalled £5.102m, down from £5.472m the previous year, reports the Telegraph.Ofcom has given the green light for tele-shopping on commercial public service television but has denied broadcasters additional advertising revenue after refusing to increase the number of adverts they are allowed to show. ITV, Channel 4 and Five have been allowed to air teleshopping for insomniacs between midnight and 6am. Another rule that limits non-PSB channels to broadcast only three hours of tele-shopping a day will also be relaxed, the Telegraph reports.The Russian investors Digital Sky Technologies (DST) paid $200m (£125m) for a 2 per cent stake in Facebook yesterday, valuing the social networking site at $10bn - or two-thirds of what it was worth 18 months ago. Facebook, which was founded in 2004 and remains a private company, sold a 1.6% stake to Microsoft in October 2007 for $240m. That investment valued the whole company at $15bn, reprots the Independent. City finance professionals are so worried about the future that nearly 30 per cent are planning to leave London, according to a survey by eFinancialCareers, a jobs website. Many have taken tangible steps towards moving, such as sending their CVs to overseas companies, and in some cases discussing internal transfers with their employers, reports the FT.Spain's Santander, one of Europe's biggest banks, has reached a settlement with the trustee seeking to recover money for Bernard Madoff's victims, agreeing to pay $235m to resolve claims against two of the bank's hedge funds managed by its Optimal investment arm, reports the FT.