Thursday newspaper round-up: BP, Fed, Executive pay
21 Jun, 2012 06:58
BT tried to pull the rug from under BSkyB's football coverage by bidding for the rights to all of the Premier League matches. The telecoms business made a surprise entry into the market last week, agreeing to pay 738m pounds to show 38 matches a season for three years from 2013. However, it was trying to buy a much bigger share of the 154 games on offer. BT lodged bids for all seven of the "packages" in which Premier League rights are auctioned, although it could not have won more than five for competition reasons. In the end BT won two Premier League packages, handing it first pick of 18 matches. Even at this level, it poses a serious threat to BSkyB, according to The Telegraph.
America's central bank has slashed its US economic growth forecasts for the next three years, as it stepped up efforts to rescue the flagging US recovery by extending "Operation Twist", a diluted version of quantitative easing. Painting a bleaker picture of economic prospects than at its last meeting two months ago, the Federal Reserve said growth would "remain moderate over coming quarters", that "employment has slowed", and "household spending appears to be rising at a somewhat slower pace than earlier in the year". It now predicts the US economy will expand by between 1.9% and 2.4% this year, compared with previous estimates of between 2.4% and 2.9%. The forecast also projected that unemployment will remain stubbornly close to 8% until the end of 2013. Speaking at a press conference on Wednesday, Ben Bernanke, Fed chairman, said that Europe was "slowing US economic growth," The Telegraph reports.
The US Federal Reserve extended its existing economic stimulus programme last night but disappointed Wall Street by deciding against embarking on a big money-printing scheme, despite cutting growth forecasts. Poor jobs figures and receding expectations had brought speculation among analysts that the Fed would opt for a full-scale restart of quantitative easing, which the Bank of England may do in Britain next month. Such a move would not only provoke anger among Republicans fearful of the inflationary consequences of money-printing, but also anger US trading partners who see QE as a covert means of devaluing the dollar, says The Times.
BP could yet find a way forward in Russia, a senior member of the country's government has suggested, declaring he did not want the British oil major to leave the country. The UK company put its 50pc stake in TNK-BP, its main Russian venture, up for sale on June 1 after a breakdown in relations with oligarch partners AAR. Igor Shuvalov, Russian first deputy prime minister, said he would be happy to see AAR buy out BP, or for AAR to find a new partner. But he added: "In the big picture, the only thing I would regret is that BP would leave. Having such an investor on the market is a very valuable thing." Mr Shuvalov told the Wall Street Journal he would not want to see a state company such as Rosneft buy BP's stake "except as part of a deal to bring in another foreign partner or as part of a larger transaction to privatise Rosneft".
Despite its best efforts, BP may be forced to sell a stake in its Russian joint venture to partners at a knockdown price, The Times has learnt. It is understood that the AAR group of oligarchs has threatened to prevent the British company from selling its stake in their TNK-BP joint venture to oil majors such as Shell and Exxon Mobil. If the move is successful and other prospective bidders stay away, BP could be forced to sell its stake to its Russian partners at a giveaway. Mikhail Fridman, one of four AAR tycoons who resigned as chief executiive of TNK-BP in May, has reportedly been meeting investors in London to canvas support for a deal to buy some or all of BP's stake in the venture, writes The Times.
A Greek exit from the Eurozone would throw 50,000 people in Scotland out of work as the shock-waves of the move wreaked havoc on the country's hopes of recovery, a leading economic forecaster has warned.In the starkest analysis yet of the crisis in the Eurozone, the Fraser of Allander Institute said that, despite not being in the euro, Scotland would still suffer from a so-called "Grexit" as exports slump, confidence drains and bank lending is further constricted. In the less likely event of a total Eurozone collapse, the impact would be even greater, with as many as 144,000 jobs lost over a three-year period, more than the cost of the 2008 financial crash, The Scotsman reports.
The Government was yesterday accused of watering down plans to enable ordinary shareholders to curb greed in Britain's boardrooms. In what Business Secretary Vince Cable yesterday billed as the biggest shake-up in executive pay in a decade, shareholders will be given binding votes enabling them to reject bumper bonuses and controversial 'golden goodbyes' for failed directors. But the Government was accused of backtracking on key proposals, with companies needing to secure a majority of 50% of votes to rubber stamp their packages rather than the 75% that Cable had been pushing for, The Daily Mail says.