ARAB TIMES, TUESDAY, JULY 19, 2011
Piraeus unit sale OK’d Morocco says to sell part of telecom stake
Egypt’s central bank said on Monday it had given prelim- The Moroccan government will sell part 61.53 million shares. French Vivendi directed to investment funds run by the expects its EBITDA to rise 1-2 percent
inary approval for Standard Chartered to start due dili- of its 30 percent stake in Maroc holds a 53 percent stake in the firm, the state,” said a Casablanca-based fund this year, so the growth potential is not
gence with a view to buying the Egyptian unit of Greece’s Telecom after a spending push to calm country’s biggest telecom company. manager who asked not to be named quite there. The market will expect the
Piraeus Bank. Standard Chartered has said it is consid- street protests eroded its public The ministry did not say when the because his merchant bank plans to bid government to offer a discount on
ering buying the unit, a deal that would boost the Greek finances and raised concern over its transaction would be completed but to advise the ministry on the sale. Friday’s closing price,” the manager said.
bank as it seeks to strengthen its balance sheet in light of ability to fund key projects. market sources in Casablanca said it At 144 dirhams a share, Maroc Maroc Telecom has subsidiaries in
the downturn facing debt-laden Greece. A source familiar with the plan told would be before the end of the fourth Telecom trades at 13.4 times its fore- Mauritania, Burkina Faso, Gabon and
Al-Mal newspaper, citing central bank sources, report- Reuters on Friday the government had quarter of 2011. cast 2011 earnings, but even though Mali, but Morocco is its main source of
ed on Monday that the central bank was in the process of revived plans to sell part of its stake. The stake is worth 8.86 billion the firm has no debt, its growth profit. “Competition in Morocco is very
setting a date to start due diligence for the Greek Bank. The finance and economy ministry dirhams ($1.1 billion) based on Maroc prospects are relatively modest, the tough, the regulator here is all over tele-
Hisham Ramez, the central bank’s deputy governor, said on Monday it will sell up to 7 per- Telecom’s closing stock price on Friday. manager said. com companies,” added the manager.
confirmed the report to Reuters. (RTRS) cent of Maroc Telecom’s capital, or “The receipts will most likely be “It’s an expensive stock: The firm (RTRS)
Political gridlock puts prized AAA credit grade in jeopardy
US bonds lose sheen as debt rating threatened
WASHINGTON, July 18, (RTRS): US founder of private equity giant think that would mean giving a green term loss of confidence in the United questioning the stringency of the criteria. buyers tax credit was put into place last
Treasury bonds could soon lose the Blackstone, appeared to be getting wor- light to additional government spending States and possibly a new financial crisis. “You go to give yourself an exam, year.
privilege of being the only debt securi- ried. He has spent many years and a lot — rather than simply making good on In Europe, meanwhile, euro zone you prepare the questions, you answer Housing starts, too, are also expected
ties in the world whose value actually of money pushing for cuts in govern- past promises, as is actually the case. leaders will meet on Thursday to dis- them, and you grade them and say, to increase slightly, even if real estate
rises on the threat of a ratings down- ment spending to cut US debt levels. A downgrade of US government cuss a second bailout package for ‘Hey look, I’m pretty good!’” said John activity is unlikely to rebound demon-
grade. “The dangerous irony is that a debt would have unpredictable and Greece and the financial stability of the Brady, a futures trader at MF Global strably any time soon. The June
That is because for the first time, the refusal to compromise on a deal to highly disruptive consequences in euro area. securities in Chicago. employment report, which pointed to a
United States’ top-notch debt rating is reduce the nation’s debt now will only financial markets and the broader econ- With the region’s fiscal problems As if the political hot-potato were virtual stagnation of the job market in
in jeopardy. serve to increase our debt,” Peterson omy. now threatening Italy, the bloc’s third not sufficiently worrying, a thin US May and June, showed the construction
US Congressional leaders are refus- said in a statement. Treasuries have long been used as a largest economy, there is a pressing economic data calendar features prima- sector was again shedding jobs.
ing to lift the country’s debt ceiling, Ironically, Peterson’s often flashy global safe-haven for investors shun- need on both sides of the Atlantic for rily figures likely to show the country’s A more forward-looking, if second-
preventing the Treasury from raising anti-debt campaigns are partly to blame ning risky assets. They serve as a bold, comprehensive solutions to debt housing market remains in a deep rut. ary, indicator is the Philadelphia Fed’s
money it has already spent. for the impasse, since Republican lead- benchmark for market interest rates problems. Existing home sales were seen rising index of Mid-Atlantic manufacturing.
The political deadlock is threatening ers have the backing of a majority of and investment portfolios. Europe’s latest round of bank “stress modestly to around 4.9 million annual- The index, among the first peeks into
the United States’ prized AAA credit Americans on the issue, according to Federal Reserve Chairman Ben tests” appeared to calm some nerves as ized units. Still, the level was a far cry economic activity in the third quarter,
grade, which major rating agencies recent polls. Bernanke argued this week that failure to fewer institutions — just eight out 90 — from the bubble peaks of around 7.1 is forecast to have returned to positive
have warned could face near-term cuts. Economists say many individuals raise the statutory limit would have failed than investors had expected. But million, and still well below readings territory at 2.0 following a reading of -
Even billionaire Pete Peterson, co- oppose the debt ceiling because they “calamitous” results, including a long- confidence remained shaky, with many close to 6 million seen after a home- 7.7 in June.
the bottomline US lawmakers working on debt
‘Plan B’ as deadline approaches
LONDON: UK Financial Investments, because it not only reduces our waste bill
the body tasked with managing the British but also generates extra income. We give
government’s stakes in bailed-out banks, our collection crews 35 percent of that
said it would step up its focus on selling extra cash as a bonus. It’s a good motiva-
the holdings, even though regulatory tion and makes good business sense for
changes look set to reduce their value. us.” Scrap merchants around the world
“We will increasingly also be focused are clamouring for material to recycle,
on the work of preparing for, and under- given record high prices of industrial met-
taking, a disposal of the Government’s als such as copper, which hit $10,190 a Geithner optimistic, says default off the table
investments,” UKFI chairman David tonne on the London Metal Exchange in
Cooksey said on Monday in the body’s February. Any Junk’s main source of
annual report. income is charging its clients to clear and WASHINGTON, July 18, (RTRS): With five days to go before was possible.
Cooksey said UKFI was waiting for a dispose of bulky waste. Overall it earns
President Barack Obama’s deadline for a debt ceiling deal “Despite what you hear, people are moving closer together,” Geithner, who met
regulatory overhaul of the banking sector, about £5 million ($8 million) a year. with top House of Representatives Republicans on Friday, told CNBC television.
including reforms drawn up by the About 5 percent of that comes from sell- and no agreement in sight, Republicans and Democrats on “You have seen the leadership of the Republican Party ... take default off the table.
Independent Commission on Banking, to ing on the junk, and about half of that is Monday were crafting a fallback plan to avert a US default. That’s encouraging.”
take effect before recommending the start accounted for by scrap metal. “It’s not
massive, but it is a relevant part of our Both parties agree on the need to raise the US debt ceiling, which caps how But the stalemate in Washington, along with debt problems in Europe, is unnerv-
of a sale process.
The ICB, due to issue a final reform business,” Mohr said. “We’re a bit like a much the United States can borrow, but are deeply divided along ideological ing financial markets worldwide amid fears that they could spiral into a global cri-
blueprint in September, said in April that skip on wheels but more flexible and with lines over how to do it. sis. World stocks dipped and gold prices hit record highs above $1,600 an ounce as
banks should “ringfence” their retail divi- a greener focus.Each truck has two crew Treasury Secretary Timothy Geithner, however, remained optimistic that a deal nervous investors sought a safe haven.
sions from their riskier investment bank- members who do all the loading and “There’s a perfect storm happening
ing arms by holding separate capital sweep up for you, and we charge accord- on a global macroeconomic basis with
reserves for each unit. ing to the space taken up.”
AnyJunk’s clients include household- no debt deal here and the ongoing
UKFI’s Cooksey warned that the ICB’s issues in Europe, and the market is
proposals and other planned regulatory ers, office managers, building contrac-
changes would hit bank valuations. tors, housing associations, commercial looking at all these things and is fairly
“The cumulative effect of these landlords and estate agents. “Basically anxious,” said Oliver Pursche, presi-
changes will also impact negatively on anyone with stuff to get rid of that is too dent of Gary Goldberg Financial
the profitability of banks and therefore on big for their regular bin collection,” Mohr Services in Suffern, New York.
the value of the taxpayer’s stakes,” he said. Each of AnyJunk’s 10 depots across The top Republican in the Senate,
said. the UK contains an area for storing Mitch McConnell, has submitted a plan
The British government, which has reusables and recyclables, including that would essentially give Obama the
said it aims to make a profit by selling its metal. (RTRS)
power to raise the debt limit and take
bank stakes, was earlier this year reported ❑ ❑ ❑ the political heat off Republicans.
to be contemplating an initial disposal in
early 2012. LONDON: Tesco, the world’s No.3 retail- Senate leader Harry Reid hopes to
UKFI oversees the government’s 83 er, will test a version of its successful begin debate on a modified version in
percent stake in Royal Bank of Scotland Clubcard loyalty card in the United States the Democratic-led Senate this week.
and its 41 percent share of Lloyds as it battles to stem losses at its Fresh & McConnell’s complicated plan to
Banking Group, acquired in return for a Easy chain.
The British supermarket group said on increase the debt limit in three stages
37 billion pound emergency capital injec- has moved to the forefront as efforts to
tion in October 2008.. (RTRS) Monday it would trial the card, to be
called “Friends of Fresh & Easy,” in reach a comprehensive deficit-reduc-
❑ ❑ ❑ seven stores in central California, this tion deal have hit a wall.
LONDON: Hedge fund firm Man Group autumn. Democrats and Republicans — with
is to buy exposure to the estates of If successful, it could be rolled out an eye on 2012 elections — are digging
defunct US bank Lehman Brothers from across the chain by the end of February, deeper into entrenched positions on
funds run by its GLG unit for $355 mil- the Financial Times newspaper said, taxes and entitlement programs such as
lion, in an effort to clean up the funds’ quoting Fresh & Easy chief executive Tim Social Security and the Medicare
holdings and make them easier to sell to Mason.
Fresh & Easy racked up 186 million healthcare program for the elderly.
GLG — bought by Man Group last pounds ($299 million) of losses in the Deal
year for $1.6 billion — was using year ended February, more than analysts’ Democrats want tax increases to be
Lehman as its main prime broker at the expected and putting a question mark
over Tesco’s goal, launched in 2007, to part of any final deficit reduction deal.
time of the US. bank’s collapse at the
nadir of the credit crisis in 2008, and conquer the United States with dis- Republicans say that would hurt a sput-
Monday’s move means Man will benefit counter-style neighbourhood stores. tering economic recovery and have
or bear the risk of any change in the value New Chief Executive Phil Clarke has taken aim at entitlement programs that
of the claims. pledged a significant reduction in losses Democrats have vowed to protect.
The cash deal mainly affects GLG’s this year and that the chain will break A file picture taken on Nov 26, 2010 in Paris at the headquarters of the CPoR Devises company, shows some gold ingots McConnell’s plan, initially presented
European Long Short fund, run by star even towards the end of the 2012-3 finan- and a coin of one euro. The price of gold surged on July 18, above $1,600 per ounce for the first time in history, as last week as a fallback option, is gain-
manager Pierre Lagrange, and its North cial year. investors bought the safe-haven metal amid deepening worries over the eurozone debt crisis. (AFP) ing traction as a viable solution in part
American fund, which will share upside MF Global analyst Mike Dennis, a See Markets – Page 42 because it would allow Republicans to
in “limited circumstances” in return for long-standing critic of Fresh & Easy, said
transferring the risk. earlier this month a loyalty card would be avoid having to take a politically toxic
vote on raising the debt limit.
“These transactions will remove the
remaining uncertainty from funds with
a high-risk strategy for a chain which has
relied heavily on money-off coupons to Builders’ outlook rises in June Democratic aides said Reid and
residual claims against the Lehman drive sales. McConnell’s staff were still trying to
estates, to the benefit of both existing and “It could confuse shoppers who are work out details of the plan, including
new investors,” Man Group Chief
Executive Peter Clarke said in the state-
The deal, which was approved by
meant to believe that Fresh & Easy is a
already price competitive and could
impact sales in the change over process
from coupons to collecting loyalty
US hiring expected to pick up spending cuts of about $1.5 trillion.
“The plan is still tenuous. We don’t
have the details yet. Everything is
extremely fluid,” a Democratic aide said.
directors of the funds rather than the points,” he said. (RTRS) NEW YORK, July 18, (AP): What’s more, none of the 73 survey global uncertainties, including the dis- The Senate, where Democrats have a
investors themselves, raises the question ❑ ❑ ❑ Economists expect US hiring to pick participants said their firms planned asters in Japan.” majority, is expected to approve the
of whether investors would have benefit- up in the second half of the year but significant layoffs, although 8 percent
ed more from holding on to the claims. LONDON: Shopping centre investor Also: final fallback plan but it is uncertain if
Plaza Centres N.V. said its bid for the said overall American growth is likely said they expected staff reductions the Republican-led House will go along.
High-profile hedge fund manager John
$1.4 billion EDT Retail Trust, via a joint to slow, partly due to the costs of through attrition, an uptick from 4 per- WASHINGTON: The outlook among US
Paulson is an investor in Lehman homebuilders became a bit rosier in “We (the Senate) are going to throw
Brothers Holdings Inc, which last month venture, had concluded and that it would Japan’s earthquake and tsunami and cent in the April survey. The manufac- it to them (House Republicans) and see
compulsorily acquire the 3.6 percent of over uncertainty over the Middle East’s turing sector had the strongest outlook June but the future prospects for home
upped its estimated payback for creditors what happens,” a Democratic aide said.
to $65 billion. shares it does not already own. upheaval. for more hiring, with transportation, construction are anything but promis-
Plaza said the off-market takeover bid ing. Democratic aides note that last week
Man Group declined to give details on The quarterly survey by the National utilities, information and communica- House Speaker John Boehner, the top
how far the GLG funds had written down by its joint US subsidiary, EPN Holdings Association for Business Economists tions next. An index of builders’ outlook for
the value of their Lehman claims. II, together with EPN GP, closed on July their industry in June rose two points to US Republican, declined to rule the
14. During the offer period EPN had for the second time included a question With high levels of unemployment McConnell plan in or out.
“We ... assume that Man would not be on the impact of the March 11 earth- among the biggest concerns in the 15, the National Association of Home
taking on the risk if it did not expect to increased its holding in EDT to 96.4 per- Obama had set a Friday deadline for
cent, from 47.8 percent. quakes and tsunami in Japan, and more economy, any forecast for increased Builders said Monday. Any reading
gain or at least come out even,” said ana- below 50 indicates negative sentiment Congressional leaders from both par-
lysts at Oriel Securities in a note. EPN’s unconditional offer was at than a third of the economists said the hiring can be seen as a positive. Still, a ties to agree on a deal to raise the coun-
“This has been in the works for some A$0.078 ($0.083) a share. disasters have led to increased costs, larger portion of survey participants, 49 about the housing market. The index
“EPN now plans to proceed with the hasn’t reached 50 since April 2006, the try’s debt ceiling. He said the July 22
considerable time,” a source close to Man while 28 percent said their companies percent, said they didn’t expect any deadline would give Congress enough
Group told Reuters. “This is not some- compulsory acquisition of the remaining have lower sales expectations as a change in their company’s hiring, a fac- peak of the housing boom.
EDT units, under the terms of the offer,” leeway to write and pass legislation
thing that GLG could have done (by result. tor that may have played in to their In May, builder sentiment hit its low- before Aug 2, when the government
itself).” it said in a statement on Monday. est level in nine months. It’s still just
Once the joint venture owned all of NABE said 48 percent of those sur- view that economic growth will slow will run out of money to pay its bills.
At 0929 GMT Man’s shares were down veyed lowered their GDP growth through the end of the year. seven points above the lowest reading
2.2 percent at 235.7 pence. (RTRS) EDT’s shares Plaza said it expected to Failure to increase the debt ceiling
delist them from the Australian stock expectations in part because of the The organization, which is made up on record, in January 2009. by then could send shockwaves
❑ ❑ ❑ Cash-strapped builders are strug-
exchange. events in Japan. of business economists and others who through global financial markets and
LONDON: UK-based junk removal firm The total cost of the 52.2 percent stake The political upheavals in the use economics in the workplace, said gling to compete with deeply discount- plunge the United States into another
AnyJunk pays its collection teams a was $242 million, of which Plaza’s share Middle East also influenced results. As 76 percent of survey respondents ed foreclosures and short sales, when recession.
bonus for the metal they can separate for was about $57 million, Plaza said. a result of the turmoil, 10 percent of expect greater than 2 percent growth in lenders allow borrowers to sell homes
sale to scrap merchants to help cut its dis- EDT is a listed real estate investment Credit rating agencies have signaled
respondents expect their input costs to gross domestic product, down from 94 for less than what is owed on their they may cut the top-notch AAA US
posal costs and boost profits. trust that invests mostly in US community
Chief Executive Jason Mohr told shopping centres. be substantially higher this year, while percent in April. The share that expect mortgages. Lower-than-expected home rating if the borrowing limit is not
Reuters that part of AnyJunk’s ethos was At March 31, EDT’s shopping centre 41 percent expect costs to be moderate- GDP growth at 2 percent or below appraisals are scuttling deals. And raised and deficit reduction measures
to encourage recycling wherever possible, portfolio was valued at $1.4 billion and ly higher. And 55 percent said the polit- swelled to 23 percent, from 5 percent loans are harder to come by, with are not laid out.
with about 79 percent of all materials it was about 89 percent leased. EDT’s total ical shifts have led them to lower their three months ago. requirements that borrowers put 20 Fitch Ratings said on Monday if the
collects avoiding landfill through reuse or equity at the the same date was $529 mil- expectations for GDP growth this year. “NABE’s July 2011 Industry Survey percent of a home’s cost as down pay- debt ceiling is not raised before Aug. 2
recycling. “Disposing of waste to landfill lion. In the survey released Monday, 43 indicates that the economic landscape ment. it would place the AAA rating on
is bad for the environment and expensive, Plaza and Elbit Imaging , through a percent of respondents said their firms is weakening and the recovery is soft- “Basically, the market continues to
so the more we can divert by recycling or 50:50 jointly controlled entity, control “watch negative,” which means it
reuse, the better,” Mohr said late last about 45.5 percent of EPN, another 45.5 are likely to increase employment in ening,” said Shawn DuBravac, chief bounce along the bottom, with condi- could downgrade it within a three-to-
week. percent being controlled by Eastgate the next six months, up 3 percentage economist for the Consumer tions in some locations beginning to six-month period. This echoed similar
“Separating scrap metal from the junk Property and 9 percent controlled by points from a similar survey done in Electronics Association. “The econom- improve,” said David Crowe, the trade warnings from the other two big rating
we collect is particularly beneficial, Menora Mivtachim Insurance. (RTRS) April and the highest number in a year. ic picture continues to be clouded by group’s chief economist. agencies, Moody’s and S&P, last week.