Controversial tax boss leaves in Barclays shake up

BARCLAYS investment arm will be

radically shaken up with the
equities and fixed income arms
being merged into a streamlined
new markets division, according to
an internal memo seen by City A.M.
yesterday.
Iain Abrahams is the most high-
profile banker stepping down in the
BY TIM WALLACE
reorganisation. He came to public
attention by creating controversial
products to reduce firms and high-
earning individuals tax bills.
The executive vice-chairmans
departure comes ahead of a wider
reputational review which will
report next month, determining
which product lines and pay
practices the bank wants to
continue as part of its programme
to clean up its tarnished image.
Executive committee members
Ivan Ritossa, who worked in FX, and
distribution head Guglielmo Sartori
di Borgoricco are also leaving at the
end of this year.
Eric Bommensath will head up
the newly merged markets division,
a promotion from his existing role
in charge of fixed income, while
Skip McGee is becoming chief
executive of corporate and
investment banking in the
Americas.
Barclays said the changes should
give the investment banks clients
better access to all its services, as
well as ensuring the executive
committee has a rounded view of
new regulations.
But analysts believe it also
represents some shrinkage from the
investment bank.
This shake-up will be a small
negative for incomes and a big
positive on cost savings, indicating a
more aggressive focus on costs than
I was expecting, said banking
analyst Cormac Leech from Liberum
Capital.
Overall it does suggest some de-
emphasis of the investment bank at
Barclays.
BUSINESS WITH PERSONALITY
ONE of the UKs biggest mortgage
lenders yesterday said it would with-
draw interest-only mortgages to future
homeowners from next week, in a fur-
ther sign of the squeeze on higher risk
lending.
Nationwide Building Society, the
third biggest mortgage lender in the
country, wrote to brokers yesterday
saying it would stop offering the mort-
gage on 11 October with final applica-
tions available to borrowers until 5pm
on 10 October.
The announcement is a blow to
hopes that mortgage lending would
jump sharply on the back of the gov-
ernments new Funding for Lending
Scheme, which aims to encourage
banks to offer more loans at lower
rates. The scheme offers banks and
building societies cheap finance if
they increase lending to businesses or
households.
Bank of England data showed on
Monday that mortgage lending
dropped by 276m last month the
sharpest decline since December 2010.
Nationwide said falling demand had
led to yesterdays decision. An upcom-
ing tightening of lending rules by reg-
ulators is also understood to have
contributed to the withdrawal
despite moves by the government to
encourage banks to maker cheaper
loans to individuals.
The cut back follows a similar with-
drawal of interest-only mortgages by
the Co-operative Bank in May. Royal
Bank of Scotland has also recently
tightened its offering of the product,
as banks shrink their mortgage lend-
ing criteria.
Nationwide said: Only three per
cent of [Nationwides] new mortgages
are arranged on this basis, and evi-
dence shows that its borrowers
increasingly want the certainty that
repayment mortgages can provide.
Banking watchdog the Financial
Services Authority had already called
on banks to be more stringent on who
they offer interest-only mortgages to.
In March, managing director Martin
Wheatley labelled interest-only mort-
gages a ticking timebomb created
over the last 20 years.
The demise of interest-only reflects
the ongoing nervousness among UK
lenders, said Lee Karasavvas, director
of the independent mortgage broker
Prolific Mortgage Finance. Interest-
only used to be at the core of the mort-
gage market but its now very much
on the periphery,
Coreco Independent Mortgage
Brokers director Andrew Montlake
said: This is a massive step for
Nationwide to take and it could well
have a big effect on other lenders who
have been monitoring this sector of
the market closely.
Experts say up to two million people
could be left unable to pay back the
principal sum at the end of their mort-
gage.
Interest-only mortgages gained a
resurgence in popularity at the height
of the debt bubble following a boom in
the late 1980s, when 80 per cent of
mortgages sales were interest-only.
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INTEREST-ONLY LOANS
ISSUE 1,732 FRIDAY 5 OCTOBER 2012
Page 21-29
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FACEBOOK TOPS ONE BILLION USERS WORLDWIDE
FACEBOOK yesterday said it had reached
1bn active users for the first time.
Chief executive Mark Zuckerberg
(pictured) announced the milestone on
his own profile, writing: Hopefully
together one day we will be able to
connect the rest of the world too.
The social network, which has
experienced a difficult six months since
its initial public offering (IPO) in May,
added that since the website was founded
by Zuckerberg in 2004, it has seen 219bn
photos uploaded, 140bn friend
connections, and 1.13 trillion clicks of the
like button.
Facebook also said 600m people were
accessing the network via mobile phones,
an area where Zuckerberg has admitted
he has a problem due to the difficulty in
placing adverts on a smaller screen. The
1bn mark was reached slightly later than
some predicted, after user growth
slowed.
As European and North America have
become saturated, Facebook has looked
to new territories for expansion.
Zuckerberg visited Russia this week, a
country where it has just 7m users, to
meet Prime Minister Dmitry Medvedev.
Brazil, Mexico and India are also sources
of growth for Facebook.
SUITSANDTHECITY
BY JAMES TITCOMB
OBAMA VS
ROMNEY
Ewan Watts verdict in The Forum, Page 18
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
Civil service says fiasco
caused by a brain drain
THE WEST Coast rail fiasco shows
that the government should pay
and praise its civil servants more in
order to reverse a brain drain out
of the public sector, the former head
of the civil service said yesterday.
Gus ODonnell a candidate for
the governorship of the Bank of
England said the government is
placing the blame with bureaucrats,
three of whom have been suspended
after the contracts collapse.
We are suffering in some areas
where there are skills shortages, in
the commissioning area, the pro-
curement area, he told the BBCs
Today programme. The thing [the
government is] doing which is, I
think, self-defeating, is attacking
their own staff; thats a mistake.
But the claim was met with
incredulity by a spokesman for the
TaxPayers Alliance, who said that
the civil service was badly managed
and had plenty of resources. It also
said that the fiasco proved that the
governments sums making the case
for the HS2 high-speed rail project
could not be trusted either.
The Department for Transport
remains in talks with Virgin Trains,
which lost out to FirstGroup in the
now-abandoned bidding process, to
extend its franchise past the 9
December deadline.
Morgan Stanley warns on Wall St pay
Morgan Stanley is preparing to wield its
axe again with more job cuts and smaller
bonuses planned for next year as the
investment bank attempts to boost
shareholder returns.
In the latest sign of the pressure Wall
Street is under to cut costs and address
high pay levels, James Gorman, chief
executive, said that staff and
remuneration would have to be sacrificed
as banks cope with lower profits. Theres
way too much capacity and compensation
is way too high, Mr Gorman said.
Kingfisher fleet to remain grounded
Indias stricken Kingfisher Airlines said
yesterday that its fleet would remain
grounded until October 12, after the
carriers management failed to resolve a
dispute with its staff over unpaid wages.
Sanjay Aggarwal, chief executive of the
cash-strapped carrier, had visited key
Indian cities to meet striking employees.
Call to review for-profit exchanges
Legal provisions that protect for-profit US
stock exchanges and allow them to write
their own rules are outdated and need to
be reviewed, a leading regulator told an
industry conference in New York.
Music industry cashes in
The music industrys push to take profits
from concerts, advertisements and T-
shirts is offsetting the terminal decline in
CD sales. Revenue from these deals rose
14 per cent to 76m last year.
Oligarch pulls out of $1bn showdown
For nearly five years, he waged a string of
bitter legal battles. Yesterday Boris
Berezovsky pulled out of his last-
remaining lawsuit weeks before it was set
to come to trial.
Debt fear as buy-out firms refinance
Private equity firms are set to take billions
of pounds out of UK companies in a
refinancing glut that has raised fears of a
new credit bubble.
QE3 could push gold to $2,400
BlackRock fund manager Evy Hambro who
invests in the precious metal and gold
equities, predicted that QE3 could result in
the gold price hitting US$2,400/oz by the
middle of next summer.
SEC caution over pay disclosures
Companies disclosing new measures of
executive pay, such as realized or
realizable pay, should be careful that
their disclosures are not misleading to
investors, a SEC official said yesterday.
Brazil Bids for New Auto Investment
Brazil yesterday unveiled new tax breaks
for corporate investment in automotive
science, technology and fuel efficiency
that are designed to boost the nation's
car industry, which accounts for around
20 per cent of economic output.
EADS CHIEF executive Tom Enders
yesterday moved to win Germanys
support for the 30bn mega-
merger with BAE by guaranteeing
German jobs in the enlarged firm.
Enders said yesterday that he
was so convinced of the project
that he was willing to offer
medium- and long-term
guarantees for German jobs.
Political interests in Britain,
France and Germany have
threatened to stymy the deal, and
Enders said last month that state
involvement must be kept to a
minimum to ensure the merged
firm remains competitive.
The EADS chief said yesterday
that both BAE and EADS would
offer Germany, France and the UK
a golden share in the enlarged
firm, to veto any firm that wants
to own more than 15 per cent of
the company.
It wouldnt cost the
governments a single cent and
they could still protect their
interests, Enders said.
He said that the merger
represented a unique
opportunity for both firms.
Both parties are gearing up for a
10 October deadline to provide
more clarity on the merger.
BAE yesterday denied that Ian
King would net an 18m windfall
from the merger.
EADS gives jobs
guarantee for
merger backing
Transport secretary Patrick McLoughlin has ordered two probes into the failures
2
NEWS
BY CATHY ADAMS
BY MARION DAKERS
To contact the newsdesk email news@cityam.com
I
T is one of the most important
economic stories of the past few
years and yet the one that is least
talked about. House prices in
virtually all parts of the country
excepting prime London have
collapsed. Its hard to believe if you
live or aspire to live in Kensington,
Richmond or another prosperous
location, but its true and its
impossible to understand the overall
economy, as opposed to the London
bubble, and British politics without
getting to grips with these statistics.
The average home in Britain sold for
163,910 in the third quarter, accord-
ing to Nationwide. That is 11 per cent
below the all time high reached at the
height of the boom, when the average
home was changing hands for
184,131 in the third quarter of 2007.
But these figures are in nominal
terms. Since then, inflation has sub-
EDITORS
LETTER
ALLISTER HEATH
Outside prime London, house prices are falling back to earth
FRIDAY 5 OCTOBER 2012
stantially eroded the purchasing
power of the pound.
The inflation-adjusted figures reveal
that the peak to trough real terms
decline has now reached around 24.2
per cent. Average house prices are
back in real terms to levels last seen in
the first quarter of 2003. In other
words, all of the gains incurred over
the past nine years have been com-
pletely wiped out. For most people in
Britain, housing has been a poor
investment over the past decade.
The figures provided by Halifax are
even more extreme. These suggest
that the real terms slump in average
UK house prices has now reached a
remarkable 33 per cent (and 19 per
cent in nominal terms). Andrew Lilico
of Europe Economics calculates that
the real-terms peak-to-trough collapse
in the 1990s was 33.9 per cent, so that
could easily be surpassed next month.
The Nationwide figures imply that
house prices remain at least 20 per
cent too high compared to earnings,
when using long-run estimates of the
price to earnings ratio. One reason for
this is that real wages have been
falling sharply. But only half of the
over-valuation in the UK housing mar-
ket has been eradicated; so unless
nominal prices fall significantly it
will probably take another five years
for consumer price inflation to bring
the market back into synch.
at record highs thanks to inflows of
foreign cash) and the Outer
Metropolitan area. The capitals price
to earnings ratio is at a horrendously
unaffordable 7.4 times.
Given how over-valued the London
market is, and its dependence on a
troubled City and declining bonuses,
as well as on potentially fickle foreign
cash, a severe readjustment at some
stage is a strong possibility, despite
supply shortages. London property
owners should resist succumbing to
delusion. It is also dangerous for the
government to encourage first time
buyers to jump into the market when
prices are falling in much of the coun-
try. And at some point, the Bank of
England will hike interest rates and
then all bets will be off.
Violent, lengthy booms and busts in
the housing market mean that house
prices can end up stagnating over
long periods of time in real terms. In
todays money, an average house cost
81,708 in the first quarter of 1975,
according to Nationwide; it was at vir-
tually the same level 82,469 by
the fourth quarter of 1995, 20 years
later, at the trough of the previous
house price bust and after huge ups
and downs. Housing during that peri-
od was merely a hedge for inflation,
nothing more. Timing is everything,
and many made a fortune buying low
and selling high.
There are, of course, massive region-
al variations. Northern Irish prices are
down 53 per cent in nominal terms
compared with 2007 levels. Southern
England has seen prices hold up bet-
ter, in particular London (down two
per cent from peak, with some areas
It emerged yesterday that Virgin
handed the DfT a report raising con-
cerns about the process in August,
after Virgin knew it was the second
favourite but before the winner was
announced. The DfT and Virgin con-
firmed last night that the paper, by
Europa Partners, addressed broad
issues around the bidding.
The DfT hired PwC in September to
comb through the West Coast fran-
chising process. It took the auditors
just weeks to uncover the flaws
throughout the system that late on
Tuesday led to the collapse of the West
Coast deal and the suspension of three
other competitions.
But the DfT brushed off reports min-
isters knew of the mistakes in the
process before former transport secre-
tary Justine Greening left the depart-
ment in the 3 September reshuffle.
Her successor, Patrick McLoughlin,
has spoken of his anger at the terrible
mistakes made within the DfT.
The department had been taking
legal advice from magic circle firm
Eversheds during the refranchising
process, while Atkins was appointed
technical adviser in April 2011.
The new jobs website for London professionals
CITYAMCAREERS.com
WHAT THE OTHER PAPERS SAY THIS MORNING
IN BRIEF
Google agrees book peace deal
nGoogle and a group of publishers
have agreed to a settlement over
making digital copies of books,
capping seven years of litigation
involving the search giants mission to
become the worlds biggest online
library. Google and the Association of
American Publishers said yesterday
that US publishers can choose to make
available or choose to remove their
books and journals digitised by
Google for its Library Project.
Credit Suisse under investigation
nUS federal and state authorities are
investigating Credit Suisse over
mortgage-backed securities packaged
and sold by the bank, it was revealed
yesterday. The Justice Department
and the New York Attorney General
are among those probing Credit
Suisses actions, according to the
sources, who spoke on condition of
anonymity. A spokesman for Credit
Suisse, Switzerlands second-largest
bank, declined to comment.
Lamprell execs face the axe
nThree executives are to stand down
from oil rig maker Lamprell after its
fourth profit warning since the spring.
Chief executive Nigel McCue is to stand
down alongside chief financial officer
Jon Cooper and chief operating officer
Chris Hand. Former chief executive Peter
Whitbread has been appointed interim
chief executive, and will remain until a
permanent replacement is found.
Cooper and Hand will stand down as
directors, but remain at Lamprell until
suitable replacements are found.
KWEKU Adoboli, the former UBS
trader accused of losing the Swiss
bank $2.3bn (1.4bn), was a star
of the prop trading floor where
he worked, a former colleague said
yesterday.
Christophe Bertrand, one of four
traders who made up the desk where
Adoboli worked, also said the
accused former trader could be
unfriendly, unpleasant, superior
in his dealings with him.
Adoboli was tasked with train-
ing Bertrand when he joined
the team in June 2010.
He was quite rough. One of
the rules he had put in place
was that I could not ask the
same question twice,
Bertrand said.
Quite often
when I asked a
question he
gave me the
silent treat-
ment.
Bertrand
said the
d e s k ,
w h i c h
t r aded
Ex-UBS trader
Adoboli hailed
as trading star
BY MICHAEL BOW
Exchange Traded Funds, had made
$70m in profits in the first half of the
year versus about $15m to $20m for
the whole of the previous year
It [the desk] was doing amazingly
well, he said. Other senior traders
would come to our desk to ask us for
our advice. Everyone knew it was
Kweku Adoboli and John Hughes
doing the proprietary trading. They
were the stars of the trading floor.
Adoboli, 32, is on trial at Southwark
Crown Court, accused of fraud and
false accounting. He denies the
charges.
The jury had previously heard
excerpts from Adobolis per-
formance appraisals, in which
he was described as the good
cop of the desk by a colleague.
Bertrand, who is French,
testified that he was
unaware of the
extent of Adobolis
trading losses until
he came into work
on 15 September,
2011, hours after
Adoboli was
arrested. The
trial continues.
Bond helps to push carmaker
Aston Martin to a pre-tax loss
ICONIC carmaker Aston Martin
swung to a loss in 2011 as financing
costs overshadowed rising sales,
according to the luxury carmakers
annual accounts.
The British firm, taken over by
Kuwaiti investors in 2007, posted a
pre-tax loss of 33.1m for last year,
from a pre-tax profit of 6.9m in
2010. Operating profits fell by three
quarters to 8.4m.
Aston Martin Holdings (UK)
incurred one-off costs by repaying a
BY MARION DAKERS 200m bank loan and buying
previous owner Fords shares.
The company also spent 2.75m to
bring production of the Rapide
model from Austria back to its
Gaydon plant in the UK.
Aston Martin entered the bond
market in June 2011, raising 300m
in high-yield seven-year notes to
replace its bank loan. Moodys
currently rates the bonds B3 the
same as Argentina. The firm also
paid a 30m dividend.
Revenues rose 6.9 per cent to
506.8m, as previously announced in
April, in spite of the ongoing
economic conditions affecting car
sales severely, the firm said.
Gross margins fell from 17.9 per
cent to 13.4 per cent, which the firm
said was in line with directors
expectations.
Aston Martin opened four
dealerships in the year to take its
total to 137.
The group had cash and cash
equivalents of 46.6m at the end of
the year, up from 43.3m at the end
of 2010. Aston Martin declined to
comment. Aston Martin said luxury car sales were recovering but its bond sale weighed on profits
Adoboli denies
the charges
STANDARD Chartered last night
insisted that its largest investor,
Singapore-based fund Temasek,
misunderstood British corporate
governance when it abstained
from voting on several board
members this year.
The 18 per cent shareholder is
known to favour firms with a
large proportion of non-
executive board members.
Temasek has assured us that
Standard Chartered denies
criticism from biggest investor
BY TIM WALLACE their abstention does not imply
any criticism of the individuals
concerned, nor Standard
Chartereds performance, a
spokesperson said.
Four new non-executives
joined the board last week, but
the move was not thought to be
in reaction to Temasek pressure.
The bank regularly changes
external board members, with a
total of 10 joining and 10 leaving
since 2005 as part of a system of
regularly refreshing the board.
FRIDAY 5 OCTOBER 2012
3
NEWS
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THE EUROPEAN Central Bank (ECB)
can only maintain its independence
by imposing strict conditions on any
bond market support for troubled
governments, its president Mario
Draghi insisted yesterday.
The outright monetary transac-
tions (OMT) plan will see the ECB
consider buying troubled govern-
ments bonds, as long as the country
agrees a programme of economic
reforms and asks the European
Stability Fund for a bailout.
But although the ECB has not yet
started buying bonds no country
has yet met the conditions Draghi
argued the proposals have already
helped by reassuring markets that he
stands ready to help when he is
needed.
He pointed to falling borrowing
costs for the Spanish government
10-year yields are down to 5.9 per
cent, down from 6.89 per cent a
month ago and 7.6 per cent in late
July.
Draghi: Plan to
buy bonds has
already helped
BY TIM WALLACE And Augusts lending data showed
Draghis earlier pledge to do whatev-
er it takes to help the Eurozone had
helped push down interest rates for
businesses. For example loans of over
1m (804m) with a fixed period of a
decade came in at 3.01 per cent,
down 49 basis points on the month.
Draghi also insisted that applying
tough conditions to OMTs, rather
than buying bonds immediately, is
the best way to keep monetary policy
independent of governments.
Conditionality has several roles. It
reduces moral hazard by govern-
ments, and will protect the independ-
ence of the ECB, he said.
For example one condition is the
signing of a memorandum with the
Euro Group, so once you have that
unanimity the whole of the Eurozone
is supporting the programme.
But if a country fails to keep to the
conditions, the OMT will be with-
drawn. And the scheme is only avail-
able as long as credit conditions
continue to be so poor as to harm the
transmission of monetary policy.
Fed minutes reveal unease over
quantitative easing programme
SEVERAL senior members of the US
Federal Reserve are concerned over
the risks surrounding its huge asset-
buying stimulus programme,
according to minutes of its
September policy meeting
released last night.
The Fed announced last
month that it would kick off
a third spell of
quantitative easing
BY JULIAN HARRIS
(QE3) at a rate of $40bn (24.7bn)
per month, adding to the $2.3
trillion of debt already snapped up.
Yet not all policy-setters are at
ease with the scheme. Several
participants reiterated their
concern that additional
purchases might complicate
the [Federal Open Market]
Committees efforts to
withdraw monetary policy
accommodation when it
eventually became
appropriate to do so,
the minutes said.
QE3 could raise
the risk of undesirably high
inflation in the future and
potentially unmooring inflation
expectations, it added.
And one hawk on the committee
added that ongoing QE could lead
to excessive risk taking on the part
of some investors and so undermine
financial stability over time.
Yet most of the committee agreed
to back the QE3 programme.
Initial unemployment claims in
the US rose by a seasonally adjusted
4,000 last week, and demand for US
factory goods crashed in August,
two data sets showed yesterday.
Mario Draghi will consider buying Spanish government bonds if the country gets a bailout
Fed chief Ben Bernanke
is supportive of QE3
FRIDAY 5 OCTOBER 2012
4
NEWS
cityam.com
MORE LENDING will help the
economy and so help the financial
system become more resilient, top
regulator Andrew Bailey said
yesterday, as he argued in favour of
temporarily lower capital and
liquidity requirements.
The head of the Prudential
Business Unit and member of the
Financial Policy Committee said
that although he wants banks to
keep raising capital levels to deal
Top regulator wants banks to
lend more to help economy
BY TIM WALLACE
with any deterioration in the
economy, it is even better for banks
to increase lending now to provide
a short-term boost to growth.
Our view here is that a
reduction in the risk arising from
this new lending caused by an
improvement in credit conditions
should offset the risk from
lowering capital buffers, he told
the Edinburgh Business School.
If such extra lending boosts
economic growth, it will enhance
resilience in the financial system.
RESCUE programmes for financially
troubled countries should seek to
avoid cutting social safety nets too
deeply and limit the shock of
spending cuts whenever it is
possible, the International Monetary
Funds (IMF) annual report
concluded yesterday.
Strains of deep austerity
programmes in countries like Greece
have prompted the IMF to take more
care over the social impact of fiscal
readjustment, however necessary
the rescue operations may be.
Executive directors agreed the
IMF could pay more attention to
inclusive growth, employment, and
other social issues, the report said.
The IMF has worked with the
International Labour Organization
on issues related to employment, as
well as social protection floors, and
the UN Childrens Fund on fiscal
issues and social policy.
However, the report also stressed
the IMFs more conventional
successes, with Ireland held up as an
example of a bailed-out country
which is performing more strongly.
Irelands programme
implementation (now in its second
year) continues to be strong. The
Irish authorities have advanced
wide-ranging reforms to restore the
health of the countrys financial
system so it can support economic
recovery, the report found.
IMF to consider
social issues in
austerity plans
BY TIM WALLACE
THE crisis in Spain intensified yester-
day, as ministers faced attacks from
within and outside government,
though a bond auction was successful,
and yields edged down.
Spanish Prime Minister Mariano
Rajoy was undermined by Spanish
central bank governor Luis Maria
Linde, who rubbished his budget
plans, calling the growth and tax rev-
enue estimates overly optimistic.
And Spains financial minister Luis
de Guindos faced student protests
when he spoke at the London School
of Economics last night. Linde went on
to call for further steps to make sure
the government hits next years deficit
target of 4.5 per cent of GDP.
This came as most bond yields fell,
with investors hoping for a bailout,
despite Rajoys promise on Thursday
that this weekend, at least, would not
see an official request for aid.
Yields on bonds set to mature in 2014
slipped to 3.28 per cent at yesterdays
auction, from the 5.20 per cent seen at
the last sale, in mid July. But 2015
bonds edged up from 3.85 per cent in
Rajoy attacked
by central bank
over fiscal plan
BY BEN SOUTHWOOD
July to 3.96 per cent yesterday.
Analysts put the falling yields down
to an expectation of an eventual
bailout in spite of Rajoys continual
delays. There is a natural demand [for
Spanish bonds] given that at some
point Spain will request a sovereign
bailout and the ECB...will buy short-
dated bonds, said Nick Stamenkovic at
Ria Capital Markets.
But intervention may come even
without a full bailout according to
Reuters sources the ECB is considering
supporting Spanish bonds through an
insurance scheme that would guaran-
tee the first 20 to 30 per cent of bonds.
GREEK police clashed with protesting shipyard workers who stormed the defence
ministry complex in Athens yesterday demanding back pay that they claimed they were
owed. About 250 shipyard workers forced their way into the complex and stood in the
ministrys grounds. Scuffles broke out when police surrounded the workers.
GREEKS CLASH WITH POLICE OVER PAY DISPUTE
Spain 10y bond yield
Aug Sep Oct
6
6.5
7
7.5
8
8.5 %
FRIDAY 5 OCTOBER 2012
5
NEWS
cityam.com
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Business Banking
Do business in a foreign currency
Trading overseas became much easier for Professor
Puzzle when we helped them keep foreign payments
in the currency that they were received.
Professor Puzzle manufactures puzzles in China and sells them internationally,
so its important to run their business as cost-effectively as possible. Their
Barclays Business Manager helped them set up a foreign currency account, so
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FOR THE FIRST TIME,
DURING THIS SATURDAYS
X FACTOR, A TV COMMERCIAL
YOU DRIVE.
On 6 October, you can take part in #YOUDRIVE, a social media rst.
Using Twitter, you drive the action of a 3-part TV story, shown this weekend
to introduce the new A-Class.
#YOUDRIVE ## to be a part of the experience.
BORIS Johnson yesterday admitted
that a new airport in the Thames
estuary would require 30bn of
public funding as he launched an
attack on the government for paying
lamentable attention to aviation
policy.
The Mayor told business leaders at
City Hall that he was hugely
concerned by the governments
independent review into airport
expansion, which will not report
until 2015. He said the delay sets a
course for economic catastrophe.
This continued inertia is being
fully exploited by our European
rivals who already possess mega
hub airports that they intend
to use to erode our
advantage...the urgency of the
situation and the lamentable
attention that the
government has paid to
this pressing issue
has forced me to
accelerate the
work that I
will do to
develop a
Boris reignites
row over delay
to airport plans
BY JAMES WATERSON credible solution.
The timing of the attack just
days before the Conservative party
conference begins in Birmingham
once again raises questions about
Johnsons leadership ambitions and
relationship with Prime Minister
David Cameron.
The Mayor has long preferred a
new airport in the Thames estuary to
expansion at Heathrow and
yesterday revealed that Boris Island
would cost 75-80bn, with the public
footing more than a third of the bill.
However a report issued today by
the think tank Policy Exchange says
an estuary airport is illogical, due
to its location and cost of
construction.
The report instead
proposes building a new
four-runway airport over the
M25 and reservoirs to the
west of the current Heathrow
site or, should that be
politically unfeasible,
expanding Luton airport
to take on hub status.
TODAY marks the one-year anniversary of the death of Steve Jobs, former Apple chief
executive. Jobs, who co-founded the company in 1976, is credited as a father of the
personal computing revolution through products such as the Macintosh, iPod, iPhone
and iPad. Jobs was also instrumental to the rise of film animation studio Pixar.
ANNIVERSARY OF STEVE JOBS DEATH
Johnson called for an end
to dither and dather
FRIDAY 5 OCTOBER 2012
7
NEWS
cityam.com
FACEBOOKS RISE TO A BILLION MEMBERS
FEB 2004 OCT 2005 SEP 2009 MAY 2012
JAN 2006
25m users
OCT 2007
50m users
AUG 2008
100m users
JUL 2010
500m users
SEP 2012
1bn users
Mark Zuckerberg
launches
Facebook
from his
dormitory
at
Harvard
Facebook hits a
prot for the rst
time as it reaches
300m users
Facebook oats at
$100bn value
having made
$1bn acquisition
bid for Instagram
Facebook comes to
25 UNIVERSITIES
in the UK
$ $ $ $ $
An artists impression of
the Pinnacle
Brookfield sues Pinnacle owners
over millions in unpaid fees
THE BUILDERS of the Pinnacle are
suing the owners of the stalled 1bn
skyscraper development for breach
of contract and are claiming
millions of pounds in unpaid fees.
According to documents filed at
the High Court of Justice,
Brookfield Construction UK, a
subsidiary of the Canadian-owned
contractor, is seeking to claw back
payments for work undertaken
under its 593m building contract
for the City skyscraper.
The documents, seen by Building
BY KASMIRA JEFFORD
magazine, state that Brookfield is
seeking to recoup 14.95m in
unpaid fees from The Pinnacle No 1
Ltd the special purpose vehicle
that owns the project.
A second parallel claim for
15.58m was also made against
parent companies The Pinnacle
Holdings Ltd and The Pinnacle
Ltd. Brookfield is also seeking
interest accruing at 1,916 per day
from 23 July 2012, bringing the total
claim to almost 16m.
Work on the Kohn Pedersen Fox-
designed Pinnacle tower also
known as the Helter Skelter came
to a grinding halt for
a second time in
January this year
after the developer
Arab Investments
failed to secure
sufficient tenants.
Brookfield
declined to
comment. Arab
Investments could
not be reached
yesterday.
UK mergers and acquisitions (M&A)
activity dropped by nearly a third
in the last quarter, according to
data released yesterday by
accountancy firm Ernst & Young.
The total value of British deals
fell by 28 per cent quarter-on-
quarter, more than double the
global rate of decline.
The figures suggest that as the
Eurozone crisis and worldwide
economic slowdown continue, UK
firms are adopting a more cautious
approach to deal making, instead
preferring to concentrate on
improvements to their existing
businesses. Leading corporates are
now focusing more on optimising
internal operations to drive growth,
profit and volume in favour of
acquiring assets, said Jon Hughes
of Ernst & Young. But when the
tide does eventually turn its these
companies that will be in the
strongest position to act and
transact.
The slowdown in M&A could
continue into 2013, the research
suggests, as firms continue to hold
out for more stable macroeconomic
conditions. It also notes that the
average UK M&A deal takes a record
high 40 days to complete.
Asia was one of the few regions
that grew deal making activity in
the quarter.
British M&A
activity drops
30 per cent
BY JUSTIN CASH
A HIRING surge in legal and profes-
sional services firms has helped buoy
the overall headcount in Londons
financial sector in the first half of the
year, according to a survey out today.
Londons financial and professional
services industry has gained 2,700
roles, or 0.4 per cent, during the first
six months of the year.
It now employs approximately
666,400 people, suggests a survey by
TheCityUK, a group representing the
financial services industry.
While expansion has slowed since
last year, when the number of jobs in
the sector grew 3.8 per cent, the fig-
ures point in a broadly positive direc-
tion despite months of renewed
economic turbulence.
Law firms have added 3,800 staff
since January, and now employ
118,700 people in London, the survey
claims. Headcount in the capitals
legal services sector has now risen
above 2007 levels, following three
years of decline until 2011.
Accounting and management con-
sultancies have gained 800 staff to
Financial jobs
market is still
in expansion
BY MARION DAKERS
take their total across the capital to
191,600.
These gains have managed to more
than offset declines in banking and
insurance jobs.
Its great to see that employment in
the financial and professional services
sector in London has continued to
increase in the first six months of
2012, and we are forecasting a 0.5 per
cent increase for the full year, said
Chris Cummings, chief executive of
TheCityUK.
The positive trend masks a gloomier
half-year in Londons insurers, where
1,700 jobs have disappeared to take
the sectors total to 70,700, and banks,
which lost a net 2,300 positions to hit
143,800.
But both these sectors still employ
more staff than before the advent of
the financial crisis in 2007, TheCityUK
and ONS figures suggest.
Fund managers are also suffering
this year, with total headcount falling
by a net 0.8 per cent, or 200 jobs, to
22,000.
Londons jobs market has shrunk by
3.7 per cent since the start of the crisis
in 2007.
A SLOWDOWN in hiring in Asia
has weighed on recruitment firm
Robert Walters third quarter
results, the company said
yesterday.
The white-collar recruiter
posted an eight per cent rise in
net fee income to 13.1m in the
UK, only to be overshadowed by a
five per cent fall on last year to
24.1m in Asia Pacific.
Robert Walters said the Asian
business had grown quarter-on-
quarter, despite an ongoing
reluctance to hire among
financial firms in the region.
Asia takes the shine off growth
at staffing firm Robert Walters
BY MARION DAKERS The groups offices in France
and Germany are also performing
well, with strong net fee income
growth in the quarter.
But overall net fee income rose
just one per cent on a year ago to
48.5m for the three months to
the end of September.
These are solid results, given a
global economic backdrop that
continues to be challenging, said
eponymous chief executive
Robert Walters.
Headcount rose by over 100 to
2,273 during the quarter, as a
result of new clients and
expansion in the firms Resources
Solutions outsourcing arm.
DAVID HELLIER: Page 14

FRIDAY 5 OCTOBER 2012
8
NEWS
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Chief exec Robert Walters said the firm is holding up well despite a rocky jobs market
RATINGS agency Moodys yesterday
said the Competition Commissions
(CC) probe into the UK car insurance
industry will negatively impact the
credit outlook of major insurers.
Firms affected by the
announcement include market
leader Direct Line, which is due to
float on the London Stock Exchange
next week.
The CCs investigation is credit
negative because at a minimum it
will create uncertainty for the
industry and more significantly
could result in lower motor
premium rates, Moodys analyst
Helena Pavicic said in a note.
Motor insurers
hit by Moodys
BY JAMES WATERSON
CAR SALES exceeded expectations in
crucial numberplate changeover
month September, data from an
industry body revealed yesterday.
Car registrations were up 8.2 per
cent compared to last year, hitting
359,612, the Society of Motor
Manufacturers and Traders (SMMT)
said, with analysts calling the boost
fantastic for the car industry.
This latest boost meant that 67,515
4.3 per cent more cars have been
sold in 2012 so far, than were sold in
the same three quarters of 2011.
The important September plate
change market outperformed expec-
tations, said SMMT boss Paul Everitt,
Although the economic outlook
remains challenging, we are starting
to see a tentative return of consumer
confidence as motorists explore new
products and the latest fuel-efficient
technologies.
More fuel-efficient cars were certain-
ly popular, driving the average new
car emissions down 3.4 per cent, from
138.7g carbon dioxide emitted per
kilometre to 133.4g.
But the rise in registrations came
mainly from traditional petrol and
diesel cars sales of vehicles powered
by alternative fuels slipped 2.2 per
Car sales boom
above forecast
in September
BY BEN SOUTHWOOD cent over the year.
David Raistrick, UK manufacturing
boss at Deloitte, noted that the
European car market was crashing
while the UK's expanded.
A review of numbers for...Europe
indicate registrations are massively
lower than last year and some coun-
tries are definitely... in freefall,
Raistrick said.
Raistrick warned that the boom was
not necessarily sustainable, predicting
the coming 12 months would be fair-
ly bleak unless manufacturers cut
into their margins and made
extremely attractive deals.
Septembers most popular models
were in line with the UKs favourites so
far in 2012: Fords Fiesta in first, fol-
lowed by the Vauxhall Corsa, with the
Ford Focus placed third.
F
INALLY, some good news. Not
only did car sales improve by
more than expected in
September, but the gains came
mostly through consumer spending
rather than corporate sales.
But wait a new car? Thats a pretty
luxurious purchase in these straitened
times, surely the squeezed middle
cant be cutting back on everything
else and then splashing out at the deal-
ership.
Well actually theyre not, according
to analysts at KPMG who estimate that
the new sales figures have been over-
stated by five per cent leaving them,
you guessed it, flat in the year to date.
Here comes the science bit.
Carmakers, keen to shift motors, offer
dealers a bonus to register their vehi-
Car sales rebound convincingly in 2012
Q1 11 Q211 Q311 Q411 Q1 12 Q212 Q312
10
8
6
4
2
-2
-4
-6
-10
-8
%change(year-on-year)
0
IRAN is suffering from
hyperinflation with prices soaring
at a monthly rate of around 69.6
per cent, a senior US economist
calculated yesterday.
The rial, Irans currency, has
plummeted since America and the
European Union began economic
sanctions against the Middle
Eastern state due to an ongoing
dispute over its nuclear
programme.
When a currency collapses, you
can be certain that other economic
US academic: sanctions against
Iran prompting hyperinflation
BY JULIAN HARRIS
metrics are moving in a negative
direction, too, said Steve Hanke of
the Cato Institute in Washington
DC. With a monthly inflation rate
this high over 50 per cent Iran is
undoubtedly experiencing
hyperinflation.
A foreign exchange black market
has long existed due to not only the
sanctions, but also other currency
controls. Hanke used new data
from the black market to estimate
inflation in Iran.
Other states to have recently
experienced hyperinflation include
North Korea and Zimbabwe.
FRIDAY 5 OCTOBER 2012
9
NEWS
cityam.com
BOTTOM
LINE
ELIZABETH FOURNIER
Loophole stops industry from going full speed
cles before a sale has actually been
agreed. This effectively makes the deal-
er the cars first official owner mean-
ing it can then be sold onto consumers
at a discounted nearly new rate.
Manufacturers benefit from the
steady flow of orders, while dealer-
ships can pocket the bonus and
bump up their sales figures when buy-
ers are staying away.
Theres nothing below board about
the process, but KPMG says a legal
loophole that allows dealers to report
a much lower level of pre-registrations
is distorting figures enough to wipe
out any positive growth.
But whether consumers are buying
new-new or nearly new, theres cer-
tainly no sign of a decline in the pri-
vate car market, which has remained
surprisingly robust while other indus-
tries have suffered.
Carmakers will take some relief from
the fact that deep discounting, attrac-
tive financing offers and fuel-efficient
new models can always tempt con-
sumers.
The drip-by-drip effect of consumer
spending may be buoying figures for
now (though a pending review of pre-
registrations by the Retail Motor
Industry Federation could change
that), but more worrying going for-
ward is the slowdown in fleet and
business orders.
While fleet sales grew moderately at
3.3 per cent on last year, business
orders were down by almost one per
cent. They may represent a small part
of the overall industry, but the figures
points to a trend of cash-strapped
firms putting off big replacement
orders while the economy is still
floundering.
In the meantime, manufacturers
will have to hope those Ford Fiestas
(still the UKs favourite car) keep flying
off the forecourts discounted or not.
Elizabeth Fournier is News Editor of City
A.M. @ej_fournier
UNITED Carpets yesterday became
the latest company to fall victim to
tough high street conditions, after it
collapsed into administration and
warned of store closures where rent
reductions could not be agreed.
Administrator Begbies Traynor
yesterday sold the flooring and beds
firm and its 72 stores, through a pre-
pack administration to a wholly
owned subsidiary of the group,
called United Carpets Franchisor.
The company said it will now seek
to agree appropriate rents with
landlords and, if necessary, will close
those stores where agreement
cannot be reached.
Pre-pack for
United Carpets
BY KASMIRA JEFFORD
BRITAINS success in the Tour de
France and in the Olympics boosted
sales of cycling gear at Halfords dur-
ing the summer, helping the retailer
to beat forecasts in the second half.
Sales at stores open more than a
year rose 4.6 per cent in the 13 weeks
to 28 September, while like-for-like
cycling sales outperformed with a
14.7 per cent rise in the quarter.
We were particularly pleased with
sales of our Pendleton and Boardman
bikes, both are designed by Olympic
gold medalists and the range has res-
onated strongly with customers dur-
ing the period, chairman Dennis
Millard said.
Halfords Autocentres car servicing
arm also reported a like-for-like sales
jump of 12.4 per cent, the strongest
growth since it was acquired in 2010.
Shares closed up 14 per cent last
night on the better-than-expected
figures and also on the announce-
ment that it has appointed a new
chief executive, the former Pets at
KASMIRA JEFFORD
Home boss Matt Davies.
Halfords former chief executive
David Wild quit abruptly in July after
four years at the helm, following a
slump in first quarter sales that was in
part blamed on the wet weather.
Investec analyst Bethany Hocking
said: [Davies] is a very strong hire, in
our view, and his background should
enable him to successfully implement
Halfords service-led strategy.
The firm now expects first half pre-
tax profits to be 40m to 42m ahead
of a consensus of 35.8m and for full
year profits in the 62 to 70m range.
Ted Baker boosted by
overseas expansion
BY CITY A.M. REPORTER
TED BAKER posted a 15 per cent rise
in first-half revenue yesterday,
helped by strong sales in the US as it
seeks to grow out of a sluggish
European market.
Retailers have come under
pressure in the face of squeezed
consumer spending, muted wages
growth and government austerity.
But Ted Baker has notched up solid
growth by tapping fast-growing
demand in the US and Asia,
recently opening new stores in
New York, Tokyo and Beijing.
The company, which started as a
menswear brand in Glasgow in
1987 and now has nearly 300 stores
and concessions worldwide,
revealed a 10.4 per cent rise in
underlying pre-tax profits to 9.4m
in the half year to 11 August as
total revenues rose to 118.6m
from 102.8m.
Retail sales were up 15.4 per cent
as it increased average retail square
footage by 12.6 per cent. In the UK
and the rest of Europe, sales grew
7.9 per cent to 74.7m while in the
US retail sales jumped 53 per cent
to $25.6m (15.9m).
Shares closed up 7.5p to 921p.
Halfords Group PLC
3Oct 4Oct 28Sep 1 Oct 2Oct
260
270
280
290
300
310
320 p
303.50
4Oct
FRIDAY 5 OCTOBER 2012
10
NEWS
cityam.com
Halfords has delivered a very strong second quarter sales performance and
what is particularly encouraging is that we dont see this as just a one-off Olympics
related boost to bike sales. Other categories, including the important, high
margin car maintenance category have also performed better than expected.
ANALYST VIEWS

The half year pre-close reports a consensus-beating second quarter per-

formance. First half prot-before-tax is expected to be 40m-42m, ahead of con-
sensus for 35.8m (and our 36.4m forecast). For the full year, management
are sensibly retaining their prudent second half planning assumptions.

A strong bounce in cycling and car enhancement drives prot upgrades,

while the appointment of CEO Matt Davies will be welcomed by shareholders.
The question is whether the cycling boost is a short-term llip or an ongoing trend and
the extent to which better execution can offset structural challenges.

DO HALFORDS RESULTS
SPELL AN ONGOING
IMPROVING TREND? Interviews by Kasmira Jefford
SANJAY VIDYARTHI ESPIRITO SANTO

BETHANY HOCKING INVESTEC

JOHN STEVENSON PEEL HUNT

Olympics help
Halfords sales
pick up speed
DEBENHAMS yesterday revealed it has appointed Googles director of retail Peter
Fitzgerald as a non-executive director to help grow the department store groups online
business. Fitzgerald, 42, joined Google in 2007 after working at Amazon for eight years.
DEBENHAMS HIRES GOOGLE EXEC TO ITS BOARD
12
IN BRIEF
Carillion warns on revenue
nConstruction firm Carillion warned
yesterday that full-year revenue will
be lower for this year than for 2011. In
its interim management statement,
Carillion said a restructuring of its UK
construction activities in a shrinking
UK market would hold back profits.
The West Midlands-based group said
it expects to deliver higher operating
profit and operating margin for the
full year. Its pipeline of future work
remains strong, it said.
Victrex continues sales growth
nThermoplastic polymer
manufacturer Victrex said yesterday
that second-half volumes were seven
per cent ahead on the same period
last year at 1,527 tonnes, due to a
strong pipeline of business in its
polymer solutions business. Full-year
volumes increased to a record 2,904
tonnes. Victrex said it had started
construction of a 90m peek plant in
Lancashire, raising its annual capacity
by 2,900 tonnes.
Johnson Matthey boosts board
nJohnson Matthey has appointed
Colin Matthews as a non-executive
director with immediate effect.
Matthews has been chief executive of
BAA since 2008, and was previously
group chief executive for Severn Trent.
He has also worked for British
Airways, Lattice Group and Hays
Group. Johnson Matthey chairman Tim
Stevenson said that Matthews had a
wealth of international industrial
experience and knowledge.
GERMAN Khan, director of Russian
oil company TNK-BP, said yesterday
that his consortium AAR will make a
competitive offer for BPs 50 per
cent stake in TNK-BP.
Khan said AAR, which already
owns 50 per cent of TNK-BP, has been
organising funding for the sale of
the stake. It will make an offer by 17
October, Khan said.
He added that the offer for the
stake will be competitive. It is
thought the bid will be between
$20bn and $25bn (12.4bn).
BP is required to hold negotiations
in good faith with fellow stake-
holder AAR until 17 October,
although a source close to the trans-
action said it was unlikely a deal
would be agreed by then, and it
would take several months for any-
thing to be agreed.
Following the 17 October deadline,
other suitors may then seek to strike
a deal, creating the prospect of a bid-
ding war.
Russian oil firm Rosneft is also con-
sidering a bid for the stake in TNK-BP,
AAR eyes entire
TNK-BP stake
as talks persist
BY CATHY ADAMS and talks between the British oil
behemoth and both parties are
understood to be underway.
Meanwhile, BP yesterday said its
Devenick gas project in the North Sea
had started successfully.
Production from the project, which
cost BP and its partners around
650m, is due to peak next year at up
to 100m cubic feet a day. It will boost
Britains gas production by around
three per cent next year, according to
energy minister John Hayes.
Elsewhere, BP said gas flows from
its Azeri Shah Deniz fields in Turkey
were stopped last night after reports
of a pipeline blast.
BNP Paribas has been appointed as lead
bookrunner on the bond offering. Leading
the transaction is Ben Canning, head of cor-
porate nance at the investment bank.
Canning joined BNP Paribas in 2007 to lead
the UK and Ireland equity capital markets
(ECM) franchise after working for Credit
Suisse for four years in the ECM division. He
has 12 years banking experience, three years
in M&A and nine in ECM. Prior to working on
the Gulf Keystone Petroleum bond offer, he
worked on the $11bn Glencore IPO last year.
He also worked with Cable & Wireless on its
230m convertible bond issue in 2010. He
has worked on various rights issues, includ-
ing with HSBC, CRH, Wolseley and Centrica.
Back in 2005 Canning was involved with the
322m Petrofac IPO, and in 2007 he worked
on the 215m Wellstream IPO. Canning is
also joined by Thierry Petit, head of equity
linked EMEA at BNP Paribas. Petit has
worked on more than 50 transactions across
Europe and Asia, and has over 11 years of
corporate nance experience. He started
with Lehman Brothers in 2001, and joined
BNP corporate nance in the M&A division
in 2004. The most recent transaction he was
involved in prior to Gulf Keystone was the
250m Faurecia convertible bond issue in
France last month.
ADVISERS BNP PARIBAS
BEN CANNING
BNP PARIBAS
Bp PLC
3Oct 4Oct 28Sep 1 Oct 2Oct
432.50
435.00
437.50
440.00
442.50
p
432.90
4Oct
Gulf Keystone secures 170m
funding for Iraq oil exploration
LONDON-listed Gulf Keystone
Petroleum is to raise $275m
(170.5m) worth of funding
through convertible bonds to
expand its operations in the
Kurdistan region of Iraq.
The bonds, which mature in
2017, will pay 6.25 per cent a year,
and the proceeds will primarily be
used to fund the development of
the oil and gas exploration
companys Shaikan block in
Kurdistan, a significant
commercial discovery made in
August, as well as three other
blocks in the region.
Todd F Kozel, chief executive of
Gulf Keystone Petroleum,
yesterday welcomed the placing,
calling it an important
milestone in the transition from
the exploration stage to the fully-
fledged development of the
world-class Shaikan discovery.
He added: It shows an
increasing confidence of
international markets in doing
business in the Kurdistan region
of Iraq.
BNP Paribas is acting as sole
bookrunner and lead manager on
the deal, while Mirabaud
Securities and Natixis are acting
as co-bookrunners.
The bonds should start trading
no later than 30 November.
FRIDAY 5 OCTOBER 2012
cityam.com
NEWS
BY JUSTIN CASH
THE Capitalist would like to thank
all those who named and shamed
in response to yesterdays request
for contenders in City A.M.s search
for the City Slum of the year. It
seems there are rats up drainpipes
all over the Square Mile, not to
mention leaking roofs.
One company complained of a mys-
terious leak at EC2s Moor House,
where although papers on one par-
ticular persons desk would always
be soaked when she arrived in the
mornings, no one has ever been able
to identify the source.
Misbehaving air conditioning units
are another common gripe among
the City crowd except over on
Fashion Street where one business
i ntel l i gence
firm has insti-
gated a free ice-
cream policy when the
Leaky roofs and
rats welcome
to the City slums
temperature tips 30 degrees celsius.
The story which tickled The Capitalist
the most, however the best worst
office tale was onelarge city broker-
ship that was duly directing clients to
a meeting room. Unfortunately part
of their office had been sub-let by the
owners of the building to other less
corporate clients.
Acci dent al l y
opening the
wrong door, clients
and brokers were
greeted by a room
strewn with rather
raunchy underwear.
It transpires it was the
new set for an adult
movie.
IAN Hannam may have left JP
Morgan after a 450,000 fine by the
FSA for market abuse, but that hasnt
stopped the newly-established
Natural Resources Forum from invit-
ing him to be their keynote speaker
at their inaugural event later this
month.
Hannam is renowned as one of the
Citys most knowledgeable bankers
in the field of natural resources and
The Capitalist cannot be the only one
in the City who feels he has been
harshly treated by the FSA, against
Hannam pipes up while Draghi
wishes his mic had been muted
whom he is currently appealing.
Says Bobby Morse of Buchanan:
Hannam will give a view that people
will be fascinated to hear.
Elsewhere, ECB President Mario
Draghi might have wished hed kept
his mouth closed at the end of his
monthly press conference yesterday.
Presumably unaware his mic was
still on, Draghi turned to vice-presi-
dent Vitor Constancio to declare that
discussion of the finer details of the
Outright Monetary Transactions had
been boring.
FRIDAY 5 OCTOBER 2012
Ian Hannam (centre) has been chosen as keynote speaker for the Natural Resources Forum
13
cityam.com
SPREAD betting firm Spreadex
was left with a rather hefty bill
this week when a punt of its own
went slightly awry. The firm ran a
promotion for a small selection of
their traders to tie-in with cutting
their FTSE spreads to one point and
Dow spreads to two points. Clients
who were enticed to try the tighter
spreads were to be rewarded with
shiny new Third Generation iPads.
Unfortunately for Spreadex, who had
anticipated dispatching around 20 of
the Apple gadgets, over 100 clients
reached the qualifying trade
threshold. The Capitalist was told that
the resulting 21k bill for tablets and
delivery was more than a little
unexpected.
ONE of the Citys favourite
restaurants 1 Lombard Street
is hosting its annual charity fine wine
auction and dinner tomorrow. The
event will feature food cooked by
world-renowned chefs including
Hibiscus Claude Bosi and Gleneagles
Andrew Fairlie, accompanied by some
of the worlds finest wines. But the
most hotly-anticipated part of the
evening will be the Money-Cant-Buy
Auction. In the past this has offered the
likes of a Michelin-Starred dinner party
prepared by Giorgio Locatelli in the
winning bidders home, as well as rare
wines and champagnes. All funds
raised will go towards charity Action
Against Hunger, which works globally
to save the lives of malnourished kids.
cityam.com/the-capitalist
THECAPITALIST
EDITED BY CALLY SQUIRES
Got A Story? Email
thecapitalist@cityam.com
A city rat as painted
by Banksy on a NY wall
Promethean falls as it
is hit by US school cuts
SHARES in interactive whiteboard
maker Promethean World
plummeted yesterday, wiping
more than 25 per cent off the
companys value, as the firm
issued a fresh profit warning.
Promethean, which generates
most of its revenues from
whiteboard sales to US schools,
said it had not seen the boost it
had expected during the start of
the school year. In a trading
update for the three months to
October, it said cuts to education
budgets had been the biggest
cause of a fall in sales to 40m,
41.2 per cent lower than the
same period last year.
This drop in turnover was far
more severe than the 23 per cent
fall in the first half of the year,
and came during Prometheans
most important period.
BY JAMES TITCOMB Demand during the key
buying season in the US has been
lower than recent years, the
company said, partly blaming a
delay on a large contract for the
fall in sales. In the short term,
the key education markets are
constrained by customer funding
issues, especially in the US and
Europe.
Yesterdays profit warning was
the second in three months, and
pushed Promethean stock down
to 14p a share more than 90 per
cent down on March 2010s initial
public offering price.
Investecs Steve Liechti cut
forecasts for Prometheans
annual turnover to 161m, which
would be a 28 per cent drop on
last year, and 2013s sales to an
even-lower 150m. The firm is
also expected to swing to a loss
this year.
To combat declining revenue,
the firm has embarked on a cost-
cutting mission, targeting 25 per
cent savings by next year. The
firm has also seen chief executive
Jean-Yves Charlier quit in July to
be replaced by US head Jim
Marshall.
The company said it remained
positive about growth when
budgets expand. Promethean
remains well positioned to
benefit when market conditions
improve, the firm said.
Luxfers chief executive, Brian Purves, (left), and group finance director Andy Beaden
Promethean World PLC
3Oct 4Oct 28Sep 1 Oct 2Oct
16
18
20
22
p
17.50
4Oct
PHOENIX IT Group yesterday
announced a surprise departure of
its chief executive, in a move that
was seen as paving the way for a
sale of the firm.
David Courtley stepped down to
make way for the firms chairman,
IT veteran Peter Bertram, while
auditors Deloitte were also sacked
after irregularities over the
companys accounts surfaced.
Analysts said Bertrams
Phoenix IT chief and auditors
out the door as a sale looms
BY JAMES TITCOMB appointment was likely to lead to
a sale of Phoenix. The investment
view is that shareholders have
been poorly served by the board
and the revolving door of
executives, said Peel Hunts
George OConnor. Shareholders
are now best served by either a
change in management ie. a
recognised fixer or having the
business taken over.
Phoenix, which it is understood
will consider offers, saw shares
rise by just under two per cent.
MOBILE payment firm
Monitise inked a tie-up with
US consultancy Cognizant
yesterday, opening the door
for its software to be
integrated with bank
systems.
The deal is expected to
hasten the rise of mobile
payments in banking, which
Monitise chief Alastair Lukies
called the channel of the
future.
Mobile paying
firm in tie-up
BY JAMES TITCOMB
FRIDAY 5 OCTOBER 2012
14
NEWS
cityam.com
A
nother day, and another
company that has its roots
firmly in the UK decides to
float in the US. In the past few
weeks two companies normally
associated with the UK market,
Manchester United and Salford-based
speciality metals group Luxfer, have
chosen the US financial markets to
list and raise new capital.
The latest figures for capital-raising
in the UK as a whole against the US
dont make pretty reading for the
London Stock Exchange.
In 2012 there have been a total of 32
London IPOs that have raised just
$1.06bn, whereas in the US there
have been 110 IPOs that have raised
$38.9bn, according to the latest fig-
ures from Dealogic.
The London market does still seem
to be able to attract resources-based
groups. Glencore managed to success-
fully float in London last year and
others look likely to follow, although
the pace of share listings has definite-
ly slowed.
There is also the current flotation of
the insurance group Direct Line to
lift the spirits, even though the valua-
tion looks like being on the cheap
side.
But in the broader market, and
especially for what are known as
growth companies, the London mar-
ket is dead on its knees.
So why would a company such as
Luxfer (its name is partly derived
from the Latin word Lux, which
means light) or the vacuum technolo-
gy group Edwards, which pulled a
London float last year only to go
ahead in 2012 in New York, decide to
cross the Atlantic to raise funds?
Easy, say bankers. The US has a
wider investor base that understands
growth companies and is prepared to
give them much stronger valuations.
Some say the multiples one can get in
the US are three times valuations in
the UK.
There were other issues associated
with the Manchester United situa-
tion, whose US IPO was led by
Jefferies. Here UK investors might
have been less trusting than their US
counterparts about the motives of
the controlling Glazer family, but
there is little doubt that US investors
generally would have found Uniteds
growth story highly plausible.
greatest regulatory burden.
But the UK market has also seen the
necessary trust between the buyer
and seller break down to a crippling
extent. After a series of disappointing
London IPOs such as Ocado,
Debenhams and Betfair, UK institu-
tions have taken the view that they
are quite likely to be shafted by issuer
companies and their advisers. The sit-
uation has only been made more
tense by the emergence of independ-
ent private equity advisers whose job
it is to advise sellers on getting the
best possible price even if it means
falling out with the book-runners in
the process.
Such a state of affairs is deeply wor-
rying for the London market and
ways out of it need to be found quick-
ly. London investment bankers, most
of whom work for global banks, say
almost universally that they cannot
remember such a depressing period.
Their banks usually get the business,
wherever it goes. But they say that
where the finance goes, the skills go
too.
david.hellier@cityam.com
In addition, the US regulatory
framework has eased with the intro-
duction of new rules, such as
Jumpstart Our Businesses, which
allows companies to float less equity
and produce accounts on a much
more delayed basis.
Whereas US companies suffered
from a regulatory handicap after the
collapse of companies such as Enron
and Tyco, UK companies are now the
ones that complain they face the
INSIDE
TRACK
DAVID HELLIER
Luxfers New York flotation shines
light on Londons listing problems
www.BarclaysATPWorldTourFinals.com
5 -12 November
The O2
FOR CORPORATE HOSPITALITY, PLEASE CONTACT IMG ON 020 8233 5888 OR ATPTennis@imgworld.com The players shown are for illustrative purposes only. Qualication
and participation subject to ATP rules. Getty Images - Clive Rose, Mike Hewitt, Kiyoshi Ota, Mark Dadswell. MEDIA PARTNERS
FINAL TICKETS REMAINING
FOR THE SEASON FINALE
IT ALL ENDS HERE
IN BRIEF
Finance training helps families
nProviding financial education to
badly off households could have
benefits worth 36m, according to a
study whose results were released by
Santander, Citizens Advice and the
University of Bristol today. Seventy-
eight per cent of study participants
changed their spending behaviour after
receiving financial training, delivering
on average 10 per week to each family.
Pace of arrears growth slows
nThe number of tenants in severe
arrears continued to grow in the third
quarter, data from Templeton LPA
revealed today, but at a reduced rate.
Compared to the second quarter, 1.6
per cent more tenants were deep in
arrears in the third quarter, well down
on the 4.6 per cent quarterly increase
between the first and second
quarters.
Food prices back on the rise
nFood prices increased in September,
according to data from the Food and
Agriculture Organisation (FAO), part
of the United Nations, released
yesterday. World prices were up 1.4
per cent compared to August, the
FAOs index, which follows a basket of
internationally traded goods, showed.
But the index is still well below its
peak in February last year.
THE BANK of Englands rate-setting
committee decided yesterday to
hold off on new policy measures in
October, with the Bank making the
last of the 50bn purchases
announced in July over the month.
Analysts across the board had
described the decision as a non-
event, expecting, correctly, that
the Bank would sit on its hands,
and announce no new policy until
the November meeting or later.
Dr Ros Altmann, boss of over-50s
lobby group Saga and long-time
critic of quantitative easing (QE),
welcomed the decision to delay any
extra intervention.
I am very pleased the Bank has
decided not to create any more
money, Altmann said, QE is a
drastic policy experiment that may
Old Lady holds
fire on policy
as QE continues
BY BEN SOUTHWOOD
be valid for an economic emergency
to avoid depression but we are
clearly not in a depression.
Indeed, we may be emerging
from recession, Altmann added,
With inflation still above target,
the Bank is right to hold off from
any more measures.
Many City economists expected
that falling inflation, combined
with the UKs very modest emer-
gence from the recession, would
spur action in November, when the
current programme of asset pur-
chases is completed.
But top Lloyds Bank macro econo-
mist Adam Chester said inflation
would stay high, limiting Bank pol-
icy options. It now looks doubtful
that headline inflation will fall
below the governments two per
cent target by the end of the year, or
through 2013, Chester warned.
WAS THE BANK OF ENGLAND
RIGHT TO HOLD RATES ?
Interviews by Faiza Malik and Justin Cash
I think rates should be set as low as
possible. Anything that tries to stimulate
growth and get us moving is a good thing.
These views are those of the individuals above andnot necessarily those of their company
CRAIG HARRINGTON
JP MORGAN

The last thing we want to do is encourage

more borrowing, but a raise may stie
growth. Weve got to invest in the long term to get the
country back on a rm footing.
GAVIN CLARKE
FINANCIAL SERVICES
CONSULTANT
Its good to get the economy going, but we
should be saving more in general. Borrowing
is ne, but it depends what its for.
DANNI STAINES
CAPITAL BORDEAUX
INVESTMENTS

Bank of England governor Sir Mervyn King has previously led votes for extra policy
CITYVIEWS
FRIDAY 5 OCTOBER 2012
16
NEWS
cityam.com
Halifax data points to house
prices stuck in the doldrums
HOUSE PRICES slipped in
September, according to data
released by Halifax yesterday,
adding to the evidence
suggesting a weak housing
market.
The average UK house price
slipped 0.4 per cent during
September to 159,586, the
Halifax house price index
showed, with analysts putting
the decline down to poor
fundamentals.
The generally weak
economic climate remains a
significant constraint on
housing demand, said
Halifaxs Martin Ellis.
Last months small fall was
the third consecutive monthly
drop, and capped off a
BY BEN SOUTHWOOD
quarterly 0.5 per cent decline,
and a total yearly dip of 1.2 per
cent.
But mortgage payments
remained at their post-crisis
low levels: from a peak of 48
per cent of disposable income
in the third quarter of 2007
they slid to 26 per cent in the
third quarter of 2012.
Ellis said this low level
provided support for house
prices, ensuring they didnt fall
further.
Analysts said the slumping
market wasnt a good advert
for Funding for Lending (FLS).
The jury is still out on FLS
and it would be good to see
some data as to exactly who is
borrowing what under the
scheme, said SPF Private
Clients boss Mark Harris.
One lender recently voiced its
concern...about the perceived
stigma attached to taking
advantage of the funds available,
fearing it gives the wrong message
to customers, Harris added.
In light of this weak picture,
economists predicted that prices
were likely to stay flat past the
end of the year.
YEARLY consumer spending
growth returned in September,
according to data that Visa
collects from use of its cards.
Spending jumped at its fastest
rate since May 2009, growing
three per cent between August
and September.
And this upturn, after
Augusts 1.2 per cent monthly
growth, pushed consumption
into positive territory for the
year as a whole edging up 0.2
per cent between September
2011 and last month. Spending
in all of the previous 11 months
was lower than a year earlier.
Face-to-face sales at high
street shops were behind much
Consumer spending expands
at the fastest rate since 2009
BY BEN SOUTHWOOD
of this increase, Visa says, as
consumers splashed out on
clothes and shoes.
The data is unaffected by the
prohibition on non-Visa card use
within the Olympic park, a
spokesperson said, as those
transactions were such a tiny
proportion of the sample size.
Chris Williamson at Markit
said that the data should
support hopes for a third
quarter recovery in output.
The data adds to evidence
that the economy pulled out of
recession in the third quarter,
but still leaves the question of
whether this is merely a
temporary rebound or the start
of a sustained upturn,
Williamson commented.
UK COMPANIES made slightly
smaller returns in the second
quarter of the year, data from
the Office for National Statistics
showed yesterday.
Private non-financial
corporations had a net rate of
return of 12.7 per cent between
April and June, down from 12.9
per cent between January and
March, the statistics showed.
The decline came from a deep
decline in North Sea Oil profits
the rate of return at UK
Continental Shelf firms dived
from 43 per cent in the first
quarter to 36.5 per cent in the
second. Factory returns were flat
and services made bigger profits.
UK profits
creep down
BY BEN SOUTHWOOD
Real house prices at after crashing from2007 peak
Jan00 01 02 03 04 05 06 07 08 09 10 11 12
10,000
1
2
3
4
5
6
7
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
Average real
house price*
(LHS)
Price to earnings
ratio (RHS)

*at 1983 prices

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F
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17
IN BRIEF
Evraz buys stake in Russian firm
nRussian steelmaker Evraz yesterday
announced it has bought a controlling
stake in Raspadskaya, Russias largest
coking coal firm. London-listed Evraz
has bought a further 50 per cent
interest in Corber, from Adroliv
Investments Limited, which holds an 82
per cent interest in Raspadskaya. The
remaining 18 per cent of Raspadskaya's
shares will remain listed on the Russian
Stock Exchange.
Atlantic Coal reports output jump
nAIM-listed Atlantic Coal said
yesterday that coal output at its
Stockton mine in Pennsylvania rose to
by 130 per cent to 44,633 tons, from
19,424 tons last year, in the three
months to September. The anthracite
coal miner reported a 38 per cent
increase in clean coal sold year on year
to 33,336 tons, from 24,111 tons over the
third quarter of 2011.
Increased revenue at Norcros
nShower maker Norcros said yesterday
group revenue in the six months to
September had grown 9.4 per cent to
106m, up from 102.4m over the first
half of last year. In a trading update, it
said underlying pre-tax profit is
expected to come in at 5.9m, up from
5.4m in 2011. Its Johnson Tiles brand
performed particularly well, posting a
17 per cent sales rise over the period.
Redrow extends bid deadline
nThe Takeover Panel has given Steve
Morgan, the chairman and founder of
Redrow, an extra two weeks to table a
bid for the housebuilder. Morgans
vehicle Bridgemere Securities, which is
bidding with Penta Capital and
Toscafund Asset Management, made a
preliminary 152p approach in August,
valuing the firm at 562m. Bid talks are
understood to have stalled after
diagreements with shareholder Fidelity.
FRIDAY 5 OCTOBER 2012
cityam.com
LONDONREPORT
S&P in reach of
five-year high as
jobs data looms
T
HE S&P 500 extended gains to a
fourth day yesterday, putting it
on the cusp of a new five-year
high if todays jobs report shows
encouraging signs for the labor
market.
The rally was broad, with all 10 S&P
500 sectors up and financials in the
lead. The S&Ps financial index gained
1.5 per cent.
In the tech arena, Google shares hit a
new 52-week high of $769.89 earlier in
the session. The stock ended up 0.7 per
cent at $768.05.
The number of Americans filing new
claims for unemployment benefits
rose only slightly last week after a big
drop the week before, the Labor
Department reported yesterday, lead-
ing to hopes that todays closely
watched non-farm payrolls report
would show improvement.
The CBOE Volatility index, Wall
Streets fear gauge, fell 5.7 per cent to
14.55. The Dow Jones industrial aver-
age gained 80.75 points, or 0.6 per
cent, to 13,575.36 at the close. The S&P
500 rose 10.41 points, or 0.72 per cent,
to 1,461.40. The Nasdaq Composite
added 14.23 points, or 0.45 per cent, to
end at 3,149.46.
The S&P 500 has climbed 16.2 per
cent so far this year. That strong gain,
combined with weak global economic
data and questions of whether Spains
bailout will come to pass, have prompt-
ed some investors to say the rally is
starting to look overextended.
Data showed US retailers September
sales looked solid as shoppers wrapped
up back-to-school buying and put the
brakes on more big spending before
the holiday season. Costco Wholesale
shares rose 1.9 per cent to $101.48 after
it reported a better-than-expected 6 per
cent rise in September sales.
B
RITAINS FTSE 100 share index
stalled near the top of its recent
range yesterday, supported by
prospects of global central bank
stimulus but struggling to break fresh
ground ahead of a potentially gloomy
earnings season.
The European Central Bank reaffirmed
its commitment to the euro and its plan
to buy bonds to bring down their bor-
rowing costs - pledges that have boosted
global equities and helped the UK index
add 6.4 per cent since late July.
But it offered no fresh catalysts for the
market, with no new remedies and no
steer on whether Spain will agree to the
strict terms necessary to launch the
bond purchases, seen as key to resolving
the Eurozone crisis.
The overall tone is slightly disappoint-
ing, said Derry Pickford, a macro ana-
lyst at fund management firm
Ashburton.
The FTSE 100 closed flat at 5,827.78
points, shrugging off an expected deci-
sion by the Bank of England to leave
monetary policy unchanged, but failing
to hold on to a one-week intra-day high
of 5,854.16 points.
The third-quarter earnings season,
which kicks off in the US with alumini-
um giant Alcoa reporting on Tuesday,
could further muddy the outlook.
UK companies are expected to report a
7.2 per cent drop in third-quarter earn-
ings versus a year ago, according to
Thomson Reuters Starmine data.
Underscoring the risks, shares in Tesco
fell three per cent, hit by a string of ana-
lyst downgrades a day after it reported
its first fall in profits in 20 years.
FTSE treads waters as lack of action
from ECB leaves investors nervous
BESTof theBROKERS
Tesco PLC
28Sep 2Oct 1Oct 3Oct 4Oct
p 345
340
335
325
330
320
318.15
4 Oct
TESCO
UBS maintains its
neutral rating for
Tesco while raising the
target price to 350p from
325p, despite first-half
trading profits that
slightly missed
consensus estimates.
DASHBOARD CITY
NEW YORK
REPORT
YOUR ONE-STOP SHOP FOR JOB MOVES,
BROKER VIEWS AND MARKET REPORTS
FTSE
28Sep 1Oct 2Oct 3Oct 4Oct
5,860
5,840
5,820
5,780
5,800
5,740
5,760
5,827.78
4 Oct
Sports Direct International PLC
28Sep 2Oct 1Oct 3Oct 4Oct
p 390
380
370
350
360
340
382.80
4 Oct
SPORTS DIRECT
Seymour Pierce has
upgraded the athletics
retailer from hold to
buy, and raised its
target price from 285p to
420p, saying the firm is
well placed to expand on
the internet.
Capita PLC
28Sep 2Oct 1Oct 3Oct 4Oct
p 790
785
780
770
760
775
765
770.50
4 Oct
CAPITA
Panmure Gordon keeps
its hold rating as well
as its 620p target price
for the outsourcing firm,
following Capitas loss of
the CRB contract. The
attrition rate on 2013
revenues is expected to
be less than one per cent
Alliance Trust Savings
The consumer finance division of
Alliance Trust has appointed
Patrick Mill as its new managing
director. Mill has over 20 years
experience in financial services,
and has previously worked as
sales director at Prudential and
managing director of financial
services at Bradford and Bingley.
Linklaters
Charles Clark has been appointed global knowledge and
learning partner at the law firm. He replaces Michael Voisin.
Clark is a capital markets partner, and joined the firm in
1980. He was most recently Linklaterss UK knowledge and
learning partner.
Mazars
Rob Weston has been appointed head of the advisory firms
UK restructuring services group. He joined Mazars as a
partner in 2004. Weston has been practising for 25 years,
and has held positions at Grant Thornton, Deloitte and
Arthur Andersen.
Berenberg Bank
The European bank has appointed Robert Wood as its chief
UK economist. He joins from the Bank of England, where he
was most recently responsible for advising the Monetary
Policy Committee on near-term growth prospects. Wood
also previously served as the Banks Asia economist.
SNR Denton
Andy Lucas has been appointed as a partner in the legal
practices technology, media and telecoms group. He was
most recently at Field Fisher Waterhouse, where he was
head of public sector.
Seymour Pierce
The investment bank has announced two appointments.
Matthew Reali joins its sales trading desk from Unicredit. He
has also held roles at Citigroup and SG Warburg. Clive
Smith joins from Kleinwort Benson, where he ran its
convertible bond sales effort. Smith has also held roles at
Mitsubishi Securities.
WHOS SWITCHING JOBS Edited by Tom Welsh
+44 (0)20 7092 0053
morganmckinley.com
SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
CITY MOVES
To appear in CITYMOVES please email your career updates and pictures to citymoves@cityam.com
in association with
Unrest spreads across Amplats
mines as African crisis deepens
LABOUR unrest has spread to Anglo
American Platinums Kumba iron ore
unit in South Africa, as around 300
striking miners downed tools.
Amplats has declared the strike ille-
gal and is talking to the workers to
encourage them back to work.
Kumbas Sishen mine produced near-
ly 40m tonnes of iron ore in 2011.
Amplats yesterday reassured
investors that the Kumba unit had
stockpiles of finished product to keep
supplying customers for some time.
Earlier this week Amplats said the
situation at its flagship site
Rustenberg, which has five mines,
had worsened, and shut the opera-
tions as a precaution.
Amplats Union mine in Limpopo, to
BY CATHY ADAMS
the north-west of Rustenberg, is still
shut amid ongoing strikes. Earlier this
week miners refused to go under-
ground for their shifts.
The worlds largest platinum produc-
er is understood to be losing around
2,100 ounces a day in platinum output
while the strikes continue.
Analyst Ben Davies at Liberum
Capital said yesterday: Amplats either
gives into demands, continues to
holds fast, or uses the opportunity to
put operations on care and mainte-
nance till a period of better pricing.
The third scenario is what investors
have been hoping for in this over sup-
plied market, but it is unlikely to be
without consequence for Anglo
American, either from the unions or
the government.
As Amplats has the largest exposure
to South Africa, and is without any
easy solutions on the horizon, Davies
expects underperformance to contin-
ue.
Meanwhile, South Africas Chamber
of Mines, the main industry body for
miners, said yesterday it was not plan-
ning to reopen wage talks for existing
agreements in the gold and coal sec-
tors, after the National Union of
Mineworks said it had agreed to.
Around 75,000 miners are currently
on strike in South Africa, or 15 per
cent of the industrys workforce,
which is crippling the countrys pro-
duction. Workers at miner Coal Of
Africa are still on legal strike, and
miner Petmin is dealing with unrest.
Miners Lonmin, Goldfields and
AngloGold have all battled with labour
unrest in the past few months.
I
N THE annals of presidential
debates, its unclear whether
Wednesday nights showdown
between Barack Obama and Mitt
Romney will go down as a classic.
The match-up failed to spawn any
memorable Reaganesque one-liners,
evocations of Clinton-style empathy
or knock-out blows. And yet the
winner was largely uncontested.
Through sheer consistency,
Romney emerged as the clear victor.
Romney was succinct, Obama
verbose. The Republican was
primarily attacked for lacking detail.
But, as Obama well knows, when you
give lucid arguments the details
dont always matter. The President
appeared exhausted and rambled,
constantly reverting to what
O
UT of all major economies,
politicians in the UK have
embraced aggressive climate
policy in the most starry-eyed
and expensive way. No other
country has taken on more ambitious
targets, done less to protect industry
from the consequences or imposed
more draconian unilateral
regulations.
We were the only country to set seri-
ous targets in the European Unions
emissions trading system from the
start. Most of the other countries
involved took the opportunity afford-
ed by the systems lax controls to print
money at our expense. According to
the think tank Open Europe, this led
to a 1.5bn transfer to other European
economies over the first phase of the
scheme.
We also accepted the most ambitious
target to increase the use of renewable
energy, and the government is paying
lavish subsidies to try and get there.
And the more expensive the source of
energy, the more generous the subsi-
dies tend to be. Onshore wind gets over
40 per megawatt hour from the
cityam.com/forum
Citigroup estimates
that meeting targets
would require 200bn
in investment by 2020
THEFORUM
Twitter: @cityamforum on the web: cityam.com/forum or by email: theforum@cityam.com
Agree? Disagree? Got a sharp comment?
The Forumwants you to join the debate.
Top responses will be reprinted in The Forum.

18
FRIDY 5 OCTOBER 2012
MATTHEW SINCLAIR
We just need the political will to
reduce destructive energy prices
renewables obligation, on top of the
normal price of energy and the carbon
price generated by the EUs emissions
trading system. Offshore wind is more
expensive it gets over 80 per
megawatt hour from the renewables
obligation.
Citigroup has estimated that meet-
ing our current environmental targets
would require 200bn of investment
from 2010 to 2020, and paying the
profits to justify that investment
would increase prices by 50 per cent.
We also have the highest taxes on
petrol and diesel in the European
Union 60 per cent of the price that
motorists pay at the pumps is tax, and
they pay vehicle excise duty on top of
that. In theory, the idea is to encour-
age people to drive less and drive more
efficient cars. However, cars are
already becoming more efficient, so
the Treasury is panicking. Its now
looking for an excuse to reform this
tax in a way that will allow them to
keep on taking motorists money any-
way.
Our tax on flights air passenger
duty is also exceptionally high. The
EUs emissions trading system also
applies to flights and we are stopping
the sector from increasing capacity at
the most popular airports. The UK is
missing out on new routes from
emerging economies that should be
bringing tourists and investors to our
shores.
The most recent example of our
exceptional embrace of expensive cli-
mate policies is the new floor under
the carbon price. Artificially increas-
ing the price of energy used in the UK
will reduce the amount that people
emit here. That will reduce demand in
the EUs emissions trading system car-
bon market and depress the price in
the other countries, as they havent
implemented a cap. It will therefore
increase emissions in those other
countries. The net result, then, is that
the measure does nothing to reduce
emissions. It simply means we do
more of the work and our industry is
handicapped twice: we pay more; our
competitors pay less.
The resulting costs to British indus-
try have been enormous. Earlier this
year, a Department for Business report
estimated that climate policies will
add nearly 30 a megawatt hour to
energy prices for energy intensive
industries here by 2020, while other
European countries will pay half that.
Families are also seeing substantial
increases in their own heat and power
bills, and vulnerable elderly people in
particular are struggling to pay. Only a
handful of politicians have spoken up
about it though.
But now things are starting to
change. Talented backbench MPs like
Dominic Raab and Chris Heaton-
Harris are willing to take on the subsi-
dies, and the special interests
profiting from them. And within the
government, both the Treasury and
the Department for Business are try-
ing to limit the rising costs. Owen
Paterson, the new Secretary of State at
the Department for the Environment,
is keen to encourage the British shale
gas industry. If he is successful that
will further undermine the econom-
ics of renewable energy.
More and more politicians are start-
ing to see the case for a more afford-
able energy policy. Unfortunately, the
targets set in Brussels and the major
policies enacted already mean that
tinkering wont work. Only a govern-
ment willing to make serious changes
can deliver the lower bills that busi-
nesses and families need.
Matthew Sinclair is chief executive of the
TaxPayers Alliance and author of Let Them
Eat Carbon.
sounded like a stale campaign
speech about clean energy and the
mess he inherited. The gulf in
quality was staggering. Even
Obamas most fervent supporters
acknowledged defeat, while others
hopelessly blamed the debate
moderator. Andrew Sullivan, the
British blogger, dubbed the
Presidents performance a disaster,
going so far as to claim that Obama
may even have lost the election
tonight.
Romneys performance will likely
have been aided by expectations. In
the build-up to Wednesday, both
camps initiated the longest sustained
period of niceties of the whole
campaign, setting the bar higher for
their opponent. In a Pew poll, just 29
per cent of voters expected Romney
to emerge the victor. But now things
are looking good for the Republican.
A CNN survey found that 58 per cent
regarded Romney as the better
leader after the debate, with 67 per
cent declaring him the winner. Such
a wide margin is rare. According to
the networks polling director, no
presidential candidate, even Ronald
Reagan after his demolition of
Walter Mondale in 1984, has ever
broken 60 per cent.
Its still unclear whether enough
viewers in key swing states deemed
Romneys performance presidential
or even watched. But the consensus
is that the debate should have done
more than enough to get his
campaign firmly back on track. The
question is now, what next? Romney
has had the propensity to squander
momentum from debates, leaving
supporters concerned and activists
frustrated. Republicans now want
him to be ruthless, to go after the
administration over Libya, and to
exploit Obamas vulnerabilities over
the economy. Just last week, US
second quarter economic growth
was downgraded and few expect
Fridays jobs numbers to breed much
confidence. In sum, Republicans
want the Romney from Wednesday
evening.
As Obama walked off the stage a
defeated man, his opponent still
exuded confidence. Romney may
have taken a pounding at times in
the Republican primaries, but its 20
debates were sound preparation for
Wednesday. And, just like back then,
he performed when it mattered. But
having benefitted from low
expectations in the first debate,
Romney now faces the challenge of
maintaining this high standard in
the next two.
Ewan Watt is a Washington, DC-based
consultant. Follow him on Twitter
@ewancwatt
THE WHITE
HOUSE RACE
EWAN WATT
Romneys debate triumph has thrown open the presidential campaign
in association with category sponsors venue sponsor champagne reception sponsor
The count down begins, join us on
17 October for the City A.M. Awards.
Grange St. Pauls Hotel, London
Visit: www.cityamawards.com to book your place.
down begins, join us on
f C A A
19
FRIDY 5 OCTOBER 2012
The Forum is open for you to take part. Got a sharp comment on
one of todays columns? Do you have another subject you want
to share your opinion on? We want to hear your views.
Email theforum@cityam.com or comment at cityam.com/forum
Contract failure
[Re: Lessons from the governments rail
franchise fiasco, yesterday]
The ownership of the rail system is not the
issue at stake. The problem is the unserious
attitude that many civil servants take when
managing government contracts. There has
been a consistent failure to realise that there
is a more to business and than following the
latest jargon put out by that years minister.
As a contractor, Ive personally experienced
this incompetence. Theres no reason why a
public enterprise cant be run professionally.
But it requires a complete rethink of the
current administrative system, which
pretends to be impartial and independent,
but which really just crawls to whichever
minister is in charge.
Carl Bennett
Milibands speech
[Re: Milibands speech: Powerful rhetoric
but muddled thinking, Wednesday]
Ed Milibands speech was terrible. Hes been
disingenuous on the 50p tax rate. And the
fact that hes still talking about universal
banking shows that the Labour party
neither understands nor has learnt from the
banking crisis a crisis that happened
exclusively on its own watch. Miliband
continues to blame the banks for Britains
problems. But he fails to acknowledge that
it was his partys legislation that made so
much of the financial crisis both possible
and likely. Unfortunately, the Conservatives
offer little alternative. Britain is now stuck
between David Cameron and Miliband, with
little chance to thrive.
IkeNwobodo
E
UROPEANS are shooting
themselves in the foot. In the
middle of recession, there
have been no attempts to roll
back the EUs massive
regulatory burden. Yet regulation is
just as much an obstacle to recovery
as unsustainable debt.
The Eurozones structural prob-
lems can seem hopeless. But theres
plenty of low-hanging fruit and
European leaders could push for
major regulatory reform. At a mini-
mum, the EU ought to repeal regula-
tions with costs demonstrably
exceeding their benefits.
According to a report by Open
Europe, between 1998 and 2008 the
cost of regulation in the UK was an
estimated 148.2bn. Regulations
adopted at the EU level accounted for
106.6bn, or 72 per cent of the total.
In the area of health and safety, 94
per cent of the regulatory costs are
explained by European regulations.
Not all EU regulations are unneces-
sary or harmful but many are. In
the area of health and safety, in par-
ticular, very few pass a robust impact
assessment. According to the UKs
Health and Safety Executive (HSE),
the European Artificial Optical
Radiation directive, adopted in 2010
to protect workers from exposure to
ultraviolet, infrared, and visible light,
was expected to bring no additional
benefit to health and safety. The cost
to businesses in the first year alone
was estimated at between 2.96m
and 6.67m.
The EU also issued two directives to
address the problem of work-related
musculoskeletal disorders (back
pain and repetitive strain injuries).
The HSE concluded that the costs of
the proposal will have a dispropor-
tionate impact on small businesses,
without any demonstrable benefits
to health and safety.
Remember the working time direc-
TOP TWEETS
You cant be a One Nation Labour party if
you put the interests of your paymasters
above those of taxpayers.
@ftcouncillor
Whatever your view of Heathrow or Boris
Island, you have to admit that these
decisions are made far too late.
@UK_Drew
The Commonwealth overtook the Eurozone
in GDP terms three months ago. The IMF
expects it to grow at 7.3 per cent per annum.
@DanHannanMEP
Imagine a Tory party with Michael Gove as
leader. He could use some the energy hes
put into education to reinvigourate Britain.
@PeterBingle
As UK universities slip down world rankings,
is private higher education the way forward?
YES
So how do governments respond to educational demand in a time of
austerity, when theres estimated to be 300m students globally by
2025? Enter the private sector, which provides quality higher
education on a large scale. A major plus is that programmes tend to
be career focussed, closely aligned to the world of work and created
in conjunction with employers and professional bodies. Additionally,
private universities encourage flexible studying and the use of
technology to deliver educational experiences to students. Private
providers in the UK are currently in the minority, and sometimes are
unfairly misunderstood. Critics views are often unfounded; one being
that private providers offer lesser quality degrees. This is not true
five UK organisations have been granted degree awarding powers,
with more to come. Nor are they any more expensive than public
universities. In fact, greater personal tuition represents better value.
Carl Lygo is principal of BPP University College.
Carl Lygo
NO
John Holmwood
The government is encouraging for-profit higher education
providers, arguing that they will improve quality and reduce costs for
students. After the replacement of direct public funding by student
fees, the government believes for-profits will put fees closer to
6,000 rather than the 9,000 charged by most universities. But, at
6,000, students will still pay nearly twice as much as in the previous
system, while each degree programme will receive about 1,500 less
in resource terms. For-profits usually spend about 35 per cent of
their revenues on marketing, as well as drawing off profits for
shareholders. As a recent US Senate report (the Harkin Report) has
shown, for-profit providers are both high cost and poor value. They
provide none of the wider benefits of universities, and spend a
smaller proportion of their fee income on teaching.
John Holmwood is professor of sociology at the University of
Nottingham, and co-founder of the Campaign for the Public University.
RAPIDresponses
How the EU could
slash regulations
and go for growth
tive, stipulating that the average
working week must be no longer
than 48 hours. And the cookie direc-
tive to protect computer users from
unwelcome website cookies, by
requiring explicit permission before
downloading any content. Costs for
the UK were estimated at 10bn, in a
worst case scenario outlined by the
customer data platform QuBit.
While repeal of unnecessary regula-
tions would be a great step forward,
the EU can do more. It can revive
service sector liberalisation, attempt-
ed in the 2006 Bolkestein directive.
The directive was stillborn. Following
pressure by interest groups, its cen-
tral idea of requiring cross-border
competitors to only comply with reg-
ulations in their country of origin
was dropped. Without it, the direc-
tive requires service providers to com-
ply with regulations in every country
in which they operate. Now the EU
must re-open the issue and create a
genuinely open space for competi-
tion in services.
Sceptics will say that liberalisation
is unlikely to be the silver bullet to
Europes economic woes. However,
the Nordic countries in the 1990s
and New Zealand in the 1980s show
that we shouldnt underestimate the
effects of serious regulatory reforms.
By pushing for a major EU-wide
deregulation instead of dreaming of
a European super state, the EU would
finally do something helpful.
Dalibor Rohac is an economist at the
Legatum Institute. Follow him on Twitter
@daliborrohac
DALIBOR ROHAC
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Page 26
Edited by
Tim
othy Barber
21
T
HERE are times when Edward
Sexton could seem straight out
of a Guy Ritchie movie, with his
wizened pink features, shock of
punkish white hair and thick
cockney accent especially when he
says, of the suits hes created with
ready-to-wear specialists Chester
Barrie: Its a steal really, one of these
suits, a bloody steal!
Equally, though, he resembles a
modern day Beau Brummell, even as
he approaches his 70th birthday, with
a style thats an immaculate mix of
elegance and quiet flamboyance.
When we meet hes sporting a double-
breasted blue suit with luxuriously
wide lapels, a sky-blue shirt with high
white collar held in place by a whop-
ping tie-pin, and natty brown suede
Derbys.
If anyone should know how to dress
well its Sexton, one of the most gifted
cutters of his generation and the man
who, together with the flamboyant
salesman Tommy Nutter in the 1970s,
brought the spirit of rocknroll to
Savile Row at a time when it was still a
hive of stiff upper lips and snooty
orthodoxy.
NUTTERS OF SAVILE ROW
Having met at a previous tailoring
house in the late 1960s, the pair
drew up plans to shake up the
traditional scene, opening Nutters
of Savile Row in February 1969,
The man who changed Savile Row
when London was in its swinging
pomp.
At the time there was Carnaby
Street or the Kings Road, and then
there was Savile Row all of them very
different, Sexton says. But there was
a huge clientele out there that wanted
Carnaby Street or Kings Road style but
with Savile Row quality, and it wasnt
around so we filled that void.
That meant expressively cut suits
with huge lapels and flares, and clien-
tele like Paul McCartney, Mick Jagger
and Eric Clapton. And it wasnt just
the cut of the suits that changed.
We were the first company ever to
have a window display. Savile Row
then was a closed shop, you went
there because your father went there
or your regiment did, so there wasnt
the walk-through feel it has today. So
when we had our showroom and a
window display where you could see
really beautifully made clothing that
had a different look to it, they were all
horrified. But we got huge interest,
and of course their clients would look
in our windows and then got to their
tailors and ask for their lapels to be
made a little bit wider or to have more
flare in the trousers. So we influenced
them that way, and gradually things
started to change.
BY APPOINTMENT
The Savile Row stalwarts who had
thought Nutter and Sexton would be
gone in six months hadnt reckoned
on the sheer quality of the work they
were producing, largely down to
Sextons talent. Forty years on and
with a lifetime of experience behind
him, Sexton runs his bespoke
business in Knightsbridge, to where
clients come by appointment only
from all over the world.
Hes also plugging some of that
wealth of knowledge into the world of
ready-to-wear and made-to-measure,
designing beautiful new looks for
Chester Barrie, the company set up in
1935 with a view to bringing Savile
Row quality to off-the-peg suits.
The results are formidable
suits that carry all the hall-
marks of Sextons handcraft, his
eye for balance and proportion
and his profound understanding
of structure, but for relatively
affordable prices (ready-to-wear
starts from 595).
You can go and buy a ready-
made suit anywhere that
looks beautifully made, but
they die the shoulders
dont work, the collar does-
nt quite fit, and its because
of all these little things that
technicians in a factory,
who dont work with
clients, cant do, Sexton
says. This is different its
investment clothing. All
my previous life experience
thats gone into this my
history is Savile Row, thats
all I know.
www.chesterbarrie.com
FRIDAY 5 OCTOBER 2012
22
cityam.com
Cad & the Dandys bespoke jeans
If youre used to going bespoke when it comes to your
suit, why not apply the same to your casualwear? in the
past one might have imagined that would result in,
well, not the most contemporary of casual looks,
but in these times when tailoring is itself the
height of fashion, it could be just the thing.
Sprightly Square Mile tailors Cad & the Dandy
founded by former City boys James Sleater and Ian
Meiers, mark it have cunningly launched a bespoke
jeans service, constructed to customers requirements in
their London workshop. www.cadandthedandy.co.uk
Alexander McQueen comes to the Row
Anyone walking up Savile Row of late will have noticed
the shop front at number 9 bearing the announcement
of the forthcoming appearance of an Alexander
McQueen boutique. McQueen himself, of course,
originally trained as a cutter on the Row, and the
brand will be working with one of the great houses
of the street, Huntsman, for its bespoke service. The
Huntsman for Alexander McQueen Savile Row cap-
sule will team the McQueen silhouette and block with
Huntsmans expertise, and will be available in a choice of
fabric weights and designs.
Travel in the ultimate style
Well-dressed travellers take note: Rubinacci, the
Neapolitan tailors with a beautiful shop on Mount
Street in Mayfair, must be the only bespoke out-
fitter with its own boutique hotel. Casa Rubinacci
is a gorgeous Naples villa run by the Rubinacci
family, in which each apartment is named after a
different fine fabric. Guests can not only enjoy
eight nights of princely Italian luxury, but will
have a bespoke Rubinacci two-piece suit thrown
into the bargain, all for 4,200 (3,380). For
more information go to www.casarubinacci.it.
In the 1970s Edward Sexton brought flamboyance, fun and flares
to the venerable world of bespoke clothing. Still one of the
worlds most sought-after tailors, he tells Timothy Barber
how he is now breathing new life into ready-to-wear suiting
Sextons ready-
to-wear suits for
Chester Barrie
start from 700.
STYLE NEWS
BY JOHN FAITHORN
T
HE first and most important
thing to note right now is that
the cut is still slim fit, single-
breasted and two-button. There
are occasional moves away, but the
overriding look is still that slim
suited look.
That doesnt mean its just a skinny
mans fashion its about the suit fit-
ting well. A suit looks best when its
fitted to your body, because it should
exaggerate the good bits and hide
the bad bits. The more fitted it is, the
more thats the case. Richard James,
for instance, still presents a lean sil-
houette, but people who arent that
lean themselves can still wear it.
There is certainly a more fashion-
able alternative: the double-breasted
suit, which is coming back and has
been seen on the likes of Gary Barlow
recently. But this in particular needs
to be cut slim and the jacket worn
short, which does not work on every
body type. Frankly, double-breasted
suits do look better on taller, slim-
mer men. In the late 80s there was a
misconception that rotund men
could pull off a double-breasted suit
with a loud pin stripe, but it actually
makes them look even shorter and
rounder. But on a fashion level, the
double-breasted look is everywhere,
and not just on suits: youll find it on
separate jackets and blazer, generally
cut shorter so that they look modern
you dont want to look like youre
wearing your dads blazer.
GO SEASONAL
I think the most common mistake
men make with suits is that they
buy one that works for business
all year around. The suit business
has been under a cloud thinking
you can only buy a suit if its a
weight thats suitable for all
seasons, but were finally moving
on again and I think its right to buy
a suit that references the season.
You invest in seasonal clothing in
other areas overcoats and jumpers
for winter, linen shirts for summer
why not in a seasonal suit?
Especially since, in the City, its the
thing you wear the most.
GET INTO SUIT FABRICS
Dont be scared of looking into
different fabrics and patterns. If
youre wearing a suit every day, it
gives you the chance to mix it up a
bit. Flannel, tweed, Donegal and
checks are important. At one time
such fabrics would be heavy but
nowadays modern fabric mills can
make texture and add depth
without adding weight you get
the look without adding bulk. At Mr
Porter we have a wool-blend tweed
suit by Etro that will look great
with a shirt and tie, but also works
when over a fine merino wool crew
or roll-neck. If that feels a bit too
country then Id suggest Richard
James more traditional Prince of
Wales check suit as a great way to
add texture.
All shades of grey seem to be the
predominant trend in terms of
colour, and this certainly adds more
interest than plain black. Those her-
itage type fabrics look great in grey
flannel and tweed textures look bet-
ter in grey than in blue.
Dont be worried about wearing
lighter shades of grey as you can use
other pieces to make it more autum-
nal. A darker shirt and tie can tough-
en up a light grey suit, for instance.
There is also the notion that suits are
for business only, but it doesnt have to
be all about the office. AMI is a chic
French label that we have stocked
since they launched and they have a
navy double-breasted suit which has
great after-dark attitude its an alter-
native to that skinny suit musicians
loved a few years ago. Ideally the best
way to approach suits this season is to
understand that they are considered
cool again, and to treat them so.
l For more information and ideas, go to
www.mrporter.com
SUITS THIS
SEASON
TOBY BATEMAN
Left: Brea slim-fit wool suit by Gucci, 895
Centre: Minete wool-blend tweed suit by Etro, 1,330
Right: Slim-fit wool and cashmere-blend suit jacket by AMI, 545
FRIDAY 5 OCTOBER 2012
23
cityam.com
Three piece
Prince of Wales
check wool suit
by Richard
James, 1,175
Look to invest in
fabrics that bring
out the best in a
grey colour palette,
says the buying
director of Mr Porter
Add some textures
to your wardrobe
I
F you were being bold, you might
argue that the 5 October 1962 50
years ago today was the most
important date in the history of
Hollywoods love affair with mens
style. It was the day Dr No opened in
cinemas, giving the first glimpse of
007 as he sat at the baccarat table.
Sean Connery is revealed, swathed in
an immaculate midnight-blue, shawl
collared dinner jacket,
cigarette dangling
nonchalantly from his
lips, as he utters the
immortal answer to an
enquiry as to his
identity: Bond oh,
you know the rest.
That dinner suit set
the tone for Bonds 50
year embodiment of the
best elements of English
style effortlessness,
urbanity, unimpeachable
masculinity paired with
calm elegance. Later this
month as you may have
heard Daniel Craig will
be carrying it off once
again in the latest film,
Skyfall.
Whereas Craigs threads
are designed by the
American fashion supremo
Tom Ford, Connerys suits
were of a less glitzy prove-
nance. The tailor Anthony
Sinclair was a Mayfair stal-
wart (on Conduit Street
rather than Savile Row) with
a clientele based around a
core of former or current British Army
officers, one of whom was Dr No direc-
tor, Terence Young.
REVIVING BESPOKE
Back then it was a world of discretion
where gentlemen would most often
be introduced to a tailor by an existing
customer, says David Mason, current
custodian of the Sinclair business,
who has recently revived it as a home
of bespoke tailoring after years when
it had faded from the limelight. It
was only natural that Young should
Killer threads: suiting Mr Connery
says Mason. It is cut short and the
trousers are high on the waist which
lengthens Connerys legs. The jacket
lapels were cut slightly narrower
than on the suits of the earlier films
and this appears to broaden his
shoulders a little more, and the sup-
pressed waist further enhances his
physique.
Mason recently took the opportunity
to recreate this suit, and the Dr No
tuxedo, for the Barbicans Designing
007 exhibition, working with
Sinclairs former apprentice, Richard
Paine, who has come out of retire-
ment to oversee the bespoke side of
the business. As Mason points out: It
was arguably the most famous set of
conventional clothes ever worn by a
man on screen.
Tom Ford may be master of many
things, but for that kind of plaudit
hell always be one step behind Mr
Sinclair of Conduit Street.
And rightly so.
www.anthonysinclair.com
Anthony Sinclair measures up Sean Connery for another Bond suit. Left, Connery in his
Dr No tuxedo; far left, in the famous checked suit from 1964s Goldfinger.
Its 50 years to the
day that cinema
goers first caught
sight of the suavest
man ever on film:
the original Bond.
By Timothy Barber
FRIDAY 5 OCTOBER 2012
24
cityam.com
introduce Connery to his own tailor
to help craft the character into his
own vision of 007.
Sinclair would go on to make all of
Connerys suits for the Bond films,
applying the Conduit Cut his sig-
nature free-moving, hourglass style
to the worlds premiere secret agent.
It was a style distinctly at odds with
the boxy, double-breasted suits popu-
lar at the time, says Mason. The coat
was cut for ease of movement, with
styling cues taken from the hacking
jacket it suited the athletic physiques
of military men.
Bond remains
as cool as ever
in latest outing
SINCE Daniel Craigs tenure
as Bond his wardrobe has
been the domain of Tom
Ford, working with the films
costume designers. From the
few Skyfall snippets weve
seen, Ford is keeping things
strictly on the straight and
narrow, with slim, light-grey
suits lifted by a mere hint of
white pocket square. Maybe
even Bond watches Mad Men.
Cary Grant: North by Northwest (1962)
A clean-cut classic, cut by Kilgour French
& Stanbury of Savile Row, makes this
Grants most stylish appearance.
Robert Redford: The Great Gatsby (1974)
Redford sports a series of sublime suits in
the film, of which this dandified pink
number with lavish waistcoat, is the best.
Steve McQueen: The Thomas Crown Affair
(1968) Cinemas other great plaid suit,
matched with blue Persol shades for the
ultimate playboy bank robber look.
Marcello Mastroianni: 8 (1963)
The dashing Mastroianni was the epitome
of paired-down Italian sartorial cool as a
filmmaker in Fellinis avant-garde classic.
FOUR OTHER BLOCKBUSTING SUITS FROM THE MOVIES
And of Connery, of course, whose
most celebrated suited moment, other
than the Dr No tuxedo, must be the
Prince of Wales check number he
sports in Goldfinger (1964). Id argue
that this miraculously debonair three-
piece, offset to perfection against a
white shirt and knitted black tie, is a
contender for the title of cinemas
greatest suit. It is pure sartorial class,
in some ways rather un-Bond the
light plaid, the expressive cut, and par-
ticularly the waistcoat, make it stand
out (and earns Bond a rather, er, dubi-
ous roll in the hay with Pussy Galore).
The vest has a slim lapel, adding a
note of elegance and touch of class,
B
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BOSS Stores in the City:
Canary Wharf Phone 020 7715 5302
Eldon Street Phone 0844 847 9202
One New Change Phone 020 7332 0573
Queen Street Phone 020 7213 9717
Londons other
sartorial street
Simon Crompton pays tribute to the home of shirts and shoes
D
ANIEL Craig looked dashing
enough in his tux while
tripping over the Queens
corgis, but cutting by far the
suaver dash at the Olympic Opening
Ceremony was David Beckham,
powering up the Thames in a
speedboat, torch in hand. In a dark
blue suit and white shirt, he was a
paragon of paired back English cool,
all thanks to a pair of young tailors
who have taken Mayfair by storm over
the past couple of years.
We got a call on the Friday afternoon
the week before saying they were look-
ing for an English tailor for him,
explains Luke Sweeney, one half of sar-
torial whiz kids, Thom Sweeney. He
wears Ralph Lauren off the peg normal-
ly, but they wanted him to be an
ambassador for Englishness for this.
Sweeney, 33, and his 32-year-old busi-
ness partner Thom Whiddett, rustled
up a crisp suit in time for the big event.
It was an open weaved navy suit with a
peaked lapel, and we teamed it up with
a white shirt and navy tie very simple
but very effective, Whiddett says.
Its another high profile coup for the
talented duo, who count Dermot
OLeary and Jimmy Carr among their
committed customers indeed OLeary
recently got married wearing his Thom
Sweeney threads.
Sweeney and Whiddett met in their
twenties while working for the cele-
brated Spitalfields master of
bespoke,Timothy Everest, where Thom
trained as a cutter and Luke oversaw
the made-to-measure business. After
paying their dues under
Everests tutelage, the
twosome struck out on
their own with the idea
of bringing some youth-
ful vim to the bespoke
trade. Two years ago
they moved into a three-
floor shop on Weighouse
Street, just behind Bond
Street tube station a beau-
tiful space that acts as one
giant mood wall, covered as
it is in framed images of
sharp-suited film and music
stars, from McQueen to
Sinatra to Caine. Now with 14
employees, theyve quickly
built up a similarly youthful
but wide-ranging clientele.
Were open minded on
what to cut, and we put people
at ease. If someone comes in
wanting a suit for going out in,
they might not be comfortable
having that conversation with
someone very venerable on Savile
Row.
Young they may be, but theres no
questioning the quality of what they
offer and the elegance of their
designs. Their hallmark has become
their use of the horseshoe waistcoat,
in which the front is scooped out in
a U-shape. Youd normally expect to
see that on tuxedo waistcoats, but it
gives Thom Sweeneys suits some raff-
ish charm with a hint of 1970s, Get
Carter-era boldness.
It was a bit of an experiment, we
tried it out one season and realised it
worked, and its spiralled from there,
says Sweeney. We do try and push a
three-piece suit, I think its a very nice
look. It gives you options too, because
you dont have to wear the waistcoat
whenever you wear the suit.
Refreshingly committed to the art of
bespoke, theyre in no hurry to leverage
their chic profile into ready-to-wear
spin-offs. Wearing a handmade suit is
the sharpest and smartest you can feel,
says Whiddett. David Beckham would
no doubt agree.
l www.thomsweeney.com
Timothy Barber
FRIDAY 5 OCTOBER 2012
26
cityam.com
I
LIKE to get round London by Boris
Bike because its quick. simple
and cheap but it brings me an
additional pleasure. Given the
distribution and popularity of bike
stops, when I come west from the
City I always park in St Jamess
Square and walk up along Jermyn
Street. And its such a joy.
There is, in my opinion, no better
street for men in London. Savile Row
gets all the attention, but its not
actually good for shopping. Its good
for a gawp in the windows, but you
hardly pop in to half a dozen tailors
to see whats new for this season.
No, Jermyn Street is the male desti-
nation. Clifford Street, with Drakes
and now Anderson & Sheppard, is
coming along, and there is some-
thing beautifully laid back about
Mount Street. But Jermyn Street,
built in 1664 on a parallel to
Piccadilly, and with its famous stat-
ue of the original sartorialist, Beau
Brummell, still casting his eye over
the scene, is special. It has by far the
biggest collection of mens requi-
sites, from shoes to shirts, razors to
cigars, anywhere in London.
ENGLANDS BEST
It is most well-known, of course, for
shirtmakers. Many of these have
long gone, and a few who continue
to use the Jermyn Street name
make all their produce overseas
and have no connection to the
street. But famous Turnbull &
Asser remains, as do Harvie &
Hudson, the ever-stylish Robert
Emmett and the ever-gorgeous
Emma Willis. Most of Englands
best shoemakers are here,
including the two best: Edward
Green and John Lobb. And then
theres Davidoff (cigars), Bates
(hats), Trickers (bespoke shoes),
New & Lingwood (shoes and shirts).
The list runs on.
As the editor of a style website, one
of the questions I am regularly asked
is which shops people of a sartorial
persuasion should visit in London (I
particularly get asked this by
Americans). My reply is often tinged
with sadness: there are few great
shops, I explain, certainly not to
compare with Paris, Rome or Naples.
London is dominated by fashion
brands and department stores.
Earlier in the year I was chastised for
this response by one chap called Steve.
Dont you dare, ever, talk down your
wonderful city again, he said. I
spent five hours in a wonderful place
called Jermyn Street today, going in
every single store. It was one of the
most inspiring mornings of my life.
Im going back to nowhere, Indiana
tomorrow. You will still be here.
Every time I get off my Boris Bike
and begin that pleasant perambula-
tion, I think of Steve. Hes right we
really are lucky to have Jermyn
Street.
l Simon Crompton edits the mens style
website www.permanentstyle.co.uk
Turnbull & Asser
One of the most famous bespoke shirtmakers in
London and still among the best value. An old-
fashioned English emporium of
gentlemans clothing and
accessories, all in the
identifiable bright T&A
colours and patterns, and
staffed by knowledgeable
dandies.
Edward Green
Its not until you walk the full
length of Jermyn Street that you
realise quite how many
shoemakers there are. The Edward
Green shop at number 75, the English
makers only store in the world, is a
definite highlight. Small and unassuming, its lines of
classical styles has recently grown to encompass a far
greater range of subtle colours and adventurous models.
Emma Willis
Shirtmaker Emma Willis opened her bright, beautiful shop
in 1999. The colour begins with the knitted shooting
socks, hanging nonchalantly out of a
wicker basket. Then there are the
dressing gowns, the Gatsby-worthy
shirts and the effervescent ties,
before we really get into trouble
and start looking at the gorgeous
shirt cloths.
New & Lingwood
Pure English eccentricity. The best
department store youve ever been
into, squeezed into one-and-a-half
small shops: New & Lingwood
manages to carry almost everything a
man could need. It is one of only a handful
of places left in London to sell starched collars for evening
shirts; its partner shop across the arcade survives almost
exclusively on selling dramatic dressing gowns.
Essential shops to visit on Jermyn Street
The Mayfair maestros behind Beckss Olympic suit
David Gandy in a Thom Sweeney
suite with horseshoe waistcoat.
FRIDAY 5 OCTOBER 2012
27
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Paxton & Whitfield
There is a cheese shop on Jermyn Street. And to
survive on a street so dominated by
menswear, it must be quite a
cheese shop. Paxton &
Whitfield lives up to that
billing, being the oldest
established cheese shop in
the country, with Royal
Warrants it still holds.
Gallic style thats perfect for an English gent
I
TS name may sound as English as
fishnchips, but JM Weston is
one of Frances great luxury
marques, producing hand-
crafted shoes since 1891. It has just
opened a fabulously chi-chi
boutique think super-sleek gents
club on Jermyn Street. City A.M.
asked the companys artistic
director, Michel Perry, if there was
room for Gallic va va voom in the
heartland of British style.
Its bold to bring a French shoe
brand to Jermyn Street, the home
of English shoes! What is it about
Jermyn Street that suits JM
Weston?
Elegance has no geographical
limits! England is renowned for its
aristocratic yet nonchalant elegance.
Its a definition that I share and that
I take pains to infuse into my
designs. In my view, JM Weston
shares the same vision of elegance
as the English houses, but it
interprets it in a very French, very
Parisian way.
How important are good shoes for
a well-dressed man, and why?
In order to be beautiful, a pair of
shoes must be a little worn; they
have to have begun to be part of
their owners life. However, only
good-quality shoes age well, because
only fine leathers and beautiful
lines can stand the test of time.
Shoes must therefore have been
crafted with the utmost
professionalism.
JM Weston is well known for its
classic loafers. Do you think its
okay to wear loafers with a
business suit?
It all depends on the cut of the suit.
Above all, you must avoid wide
trousers if youre wearing loafers. If
the suit has been cut by [Hedi
Slimane, why not, it could look
really good!
How would you describe the style
of shoes you design?
J.M. Weston is halfway between
Italian exuberance and English
tradition. Its style is Parisian,
restrained and contemporary we
dont look to be fashionable but to
enhance the style of the wearer.
What is so special about the
quality of the leather used in
JM Weston shoes?
The leathers for our soles come
from our own tannery (the Bastin
Tannery), just like the leathers for
our uppers (which come from the
Puy Tanneries). What is particularly
important to note is the key role
that the leather used for the sole
plays in the durability of our shoes.
It is this leather that makes the shoe
comfortable, as well as maintaining
its whole structure, and ensures the
shoe will not lose its shape on wear.
l 60 Jermyn Street, SW1 6LX
www.jmweston.com
John Faithorn
Luke Sweeney and Thom Widdett. Left, David Beckham heads
up the Thames in a suit specially commissioned from the pair.
Michel Perry of
French shoemaker
JM Weston talks
footwear, elegance
and Jermyn Street
Eton Mocassin by JM Weston, 545.
AUTUMNtones
Above, the inner sanctum of Thresher & Glennys historic
tailors shop on Middle Temple Lane.
Accessorising with orange, tan or red-
brown leather will give some seasonal
lift to your professional attire
FRIDAY 5 OCTOBER 2012
28
cityam.com
Document case
Handmade in rust brown leather
715 from William & Son.
www.williamandson.com
Simon Crompton
Editor, Permanent Style
I really admire the
umbrellas made by
Neopolitan
craftsman Mario
Talarico. These
single-stick
concoctions are
unique and will last a
lifetime, and can be found at
Rubinaccis, the Italian tailors on
Mount Street.
www.mariotalaricocom
The experts discoveries
Toby Bateman
Buying director, Mr Porter
Alexander Olch started making
handmade ties whilst at
Harvard University,
producing ties,
bow ties and
pocket squares
in unusual
fabrics including
plaid, corduroy and
wool which is a great way
to introduce interest and texture with
accessories. ww.mrporter.com
Timothy Barber
Editor, Suits & the City
and 0024 WatchWorld magazine
I think a vintage watch is the perfect
accompaniment to a bespoke suit.
Watches of Knightsbridge
is a young auction
house that holds
its auctions
online as well as
live,with watches
anywhere from
100 to 30,000.
www.watchesofknightsbridge.co.uk
iPad case in mulberry leather
Leather-bound in the UK by
Aukward. 149.99 from Aukward.
www.aukward.com
Leather Folio
Ludgate folio in cognac-tone
leather by Tanner Krolle. 350
from Tanner Krolle.
www.tannerkrolle.com
Pilot watch on leather strap
The El Primero Pilot Big Date
Special by Zenith.
4,700 from the Watch Gallery.
www.watchgallery.com
Camel-brown gloves
Leather gloves lined with
cashmere by Want Les Essentiels
de la Vie. 205 from Mr Porter.
www.mrporter.com
Fleet Streets historic temple of bespoke
T
HRESHER & GLENNY isnt the
kind of place you are likely to just
stumble across, tucked away as it
is on Middle Temple Lane, just off
Fleet Street. But this inauspicious little
store could just be the oldest
remaining tailor in the world: one that
has survived through word of mouth,
as it has since Lord Nelson used to call
upon its services for his silk stockings.
In those days, military, naval and
colonial officers made up a sizable
portion of its clientele a nod to
which is made in-store, through a
remarkable antique formal military
dress jacket standing at attention
by the front door.
The company has held a Royal
Warrant since 1783, when it was
appointed hosier to George III, a
royal connection that still contin-
ues to this day.
The reason the great and good
have been willing to put their sar-
torial life in the hands of one
company is its attention to
detail. What do kissing buttons
on your (always working) cuffs
say about you? What are the
implications of three buttons,
rather than two? Slanted pock-
ets rather than straight?
The suits only bear subtle men-
tion of the company that has
crafted them, although they all
have the signature peacock logo
on the pocket flap a seal that
harks back to the nickname of
the tailor, which was once locat-
ed besides a pub called The Peacock.
And a fitting at Thresher & Glenny
also comes with an additional bonus:
the offer of a fine gin and tonic. What
better way to pass an afternoon while
you pick out that perfect suit and muse
on the fact that, not only are you get-
ting a spectacular handmade garment,
but one that comes with 230 years of
history folded into its seams.
Thresher & Glenny made Nelsons stockings,
and now makes suits that whisper distinction
nWear the shoes you're likely to wear with the suit, and
a comfortable shirt and tie.
nTake a proper look at your body shape and regime.
Don't hold your breath unless you really mean to make
good on that Marathon promise; don't go after a long
lunch unless that's how you spend most afternoons.
nDon't be tempted by the dandyish impulse that often
takes hold when devoting time to clothes. You don't want
it to shout; rather whisper distinction.
nAsk the important people in your life what styles and
colours they believe best suits your character, age and
role in life (then do your own thing anyway).
nLook critically at the clothes of people in the public eye
and work out if they're saying the right things. Newsnight
is useful, Hollyoaks less so.
Five tips for going bespoke
own experiences as a soldier. Set in a military
hospital at the fag end of South East
London Woolwich, SE18 to be precise
where six soldiers are convalescing from
various ailments, ranging from post-
traumatic shock to frostbite.
Sexist banter and masculine bluster
mask an underlying fragility running
through the play, although several
emotional moments a comatose
soldier being tucked up in bed after
a chillingly vivid nightmare
highlight that army life isnt,
perhaps, all its cracked up to be.
Despite spending 90 minutes
mostly gawping at Billie Pipers
mouth (it really is as big as they
say), I can conclude Our Boys
is sure to draw crowds for
its light-hearted and
humane look at the post-
service scrapheap.
ITS PRESS night at Our Boys, and
Im sandwiched between
Londons new theatrical
glitterati Billie Piper, Jemima
Rooper and several generations
of Dr Who. They were there to
support their boys: a group of 20
somethings including Laurence
Fox (of THAT acting dynasty)
portraying the shattered
lives of army soldiers.
Writer Jonathan Lewis
based Our Boys around his
LIFE&STYLE
FRIDAY 5 OCTOBER 2012
30
cityam.com
GOING OUT
The Knot fails but Liberal Arts is a mixed bag
FILM
THE PERKS OF BEING
A WALLFLOWER
Cert 12A | By Steve Dinneen
hhiii
Laurence Fox (left) plays a shattered soldier
THEATRE
OUR BOYS
The Duchess Theatre | By Cathy Adams
hhhhi
Few perks in this soppy teen melodrama
T
HE PERKS of Being a Wallflower
promises to be that rare thing:
a high school movie with
weight; a coming of age story
about characters you recognise.
It follows the archetypal bunch of
High School Misfits (TM); a group so
socially hideous that they can only
stand each others company. And it
doesnt wash for a second.
Charlie, the hero of the piece, is a
super-brainy, darkly handsome kid
with a troubled past. Patrick (played
by We Need To Talk About Kevins
Ezra Miller) is a gay teenager with no
hangups about his sexuality and a
tongue quicker than Oscar Wildes.
Sam (Emma Watson) is the kind of
soft-focus beauty that people queue
outside of nightclubs to catch a
glimpse of. They hang around listen-
ing to The Smiths and star in their
own version of The Rocky Horror
Picture Show. No teenagers in the
history of teenagers have ever been
this achingly, nauseatingly cool
accepting them as social outcasts
requires a monumental suspension
of disbelief. Their love affair with
Fitzgerald and vinyl records is pre-
sented with a veneer of high-school
pretension, but novelist/screenplay-
writer/director Stephen Chbosky just
loves these kids too much to ever
make them look genuinely silly.
Its a shame as the film progress-
es, the storytelling becomes increas-
ingly adept, with some tear-jerkingly
poignant moments. But in the end,
its always swimming against a sea of
melodrama. Its a vaguely engaging
nostalgia-trip for anyone who grew
up in the 80s but you cant help feel-
ing Charlie, Sam and Patrick would
find this movie far below their
implausibly refined tastes.
THE KNOT (cert 15)
With The Knot, British
screenwriter/actor Noel Clarke
(Kidulthood, Adulthood) is
attempting to cash in on wedding-
based money-spinners Bridesmaids
and The Hangover. The problem is,
those two films were funny and The
Knot is not.
Instead we get a jovial procession
of tired clichs, unsympathetic
characters and unfunny jokes
douchebag men who pee on toilet
seats and sentimental women who
crave fairytale white dresses.
There is a universal lack of chemistry
amongst the cast, but the bride and
groom are especially unconvincing as a
couple. They appear to have nothing in
common apart from a few obnoxious
friends and an inability to act. This is a
certified zero-laugh comedy. Watching
it is as enjoyable as being forced to
attend the real-life nuptials of a couple
that you do not know or like. It captures
all the boredom and toe-curling
embarrassment of a wedding, but none
of the potential for poignancy or
humour.
The cast of The Perks
of Being a Wallflower
are too cool for school
Our Boys is a brave look at post-war trauma
LIBERAL ARTS (cert 12A)
Actor/screenwriter/director Josh
Radnors second feature film, Liberal
Arts, is a twee but intelligent
nostalgia trip that will appeal to
jaded adults pained by the disparity
between youthful idealism and the
reality of mature life. Good
performances all round and sensitive
characterisation render the earnest
talkiness just about bearable.
Jesse (played by Radnor himself) is
a 30-something admissions officer
in a New York university, who is
undergoing a kind of early mid-life
crisis, during which is introduced to
an enthusiastic young student
frustrated with the immature guys
on campus. Radnor is perceptive in
his handling of the motivations that
might cause a 19 year old to fall for
a 35 year old and a 35 year old to
fall for a 19 year old and there is
unexpected wisdom in the way he
resolves it.
By Alex Dymoke
The Knot is a zero laugh comedy. Say I dont.
31
TV & GAMES
cityam.com
T
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S
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BBC1
SKY SPORTS 1
7pmPremier League Preview
7.30pmLive Victory Shield
Football 9.30pmPremier League
Preview10pmThe Fantasy
Football Club 11pmBoots n All
12amPremier League Preview
12.30amThe Fantasy Football
Club 1.30amICC World
Twenty20 Cricket 3.30amThe
Fantasy Football Club 4.30am
Premier League Preview
5am-6amBoots n All
SKY SPORTS 2
6.30pmTight Lines 7.30pmLive
Premiership Rugby Union 10pm
WWE: Late Night Smackdown
12amWWE: Late Night Bottom
Line 1amVictory Shield Football
3amBoots n All 4am-6amLive
ATP Tennis
SKY SPORTS 3
7pmICC World Twenty20 Cricket
9pmLive PGA Tour Golf 12am
European Tour Golf 2amTight
Lines 3amThrillseekers 3.30am
IAAF Athletix 4amPremiership
Rugby Union 5.30am-6am
Premier League World
BRITISH EUROSPORT
7pmTwenty20 Champions
League Cricket 8.30pmWTA
Tennis 10.30pmTriathlon
11.30pm-12.30amTen Pin
Bowling
ESPN
7pmLive Scottish Premier League
Football 10pmBundesliga
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11.45pmWeather
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4.40am-6amClose
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Fill the grid so that each
block adds up to the total
in the box above or to the
left of it.
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digits1-9 and you must not
use the same digit twice in
a block. The same digit may
occur more than once in a
row or column, but it must
be in a separate block.
COFFEE BREAK
Using only the letters in the Wordwheel, you have
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none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters
or more, all must contain the central letter and
letters can only be used once in every word. There
is at least one nine-letter word in the wheel.
Place the numbers from 1 to 9 in each empty cell so that
each row, each column and each 3x3 block contains all the
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Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
KAKURO
QUICK CROSSWORD
LAST ISSUES
SOLUTIONS
KAKURO
WORDWHEEL
SUDOKU
SUDOKU
QUICK CROSSWORD
WORDWHEEL
1 2 3 4 5
6 7
8 9
10
11 12 13 14
15 16 17 18 19
20
21 22
23
20 17 5
21 3
13 17
14 23
8 21
30 29
19 9
39 6
12 10
11 37
7 10 10
15
20
28
22
11
14
16
6
23
13
35
34
12
22
13
15
7
12
38
16
11
8
ACROSS
1 Crucial (9)
8 In the centre of (5)
9 Bar of metal (5)
10 Epoch, age (3)
11 American ___,
poisonous shrub (5)
13 Controlled a
vehicle (5)
15 Head/body
connectors (5)
18 Christ (5)
20 Notice of intent
to pay (inits) (3)
21 Exaggerated
nasality in
speech (5)
22 Man-made bre (5)
23 Moving staircase (9)
DOWN
2 Rebuke (5)
3 Enthusiastic (5)
4 Chinese secret
society (5)
5 Prex denoting
a partly British
connection (5)
6 Motherhood (9)
7 Putting emphasis
on (9)
12 Large northern
deer (3)
14 Wheat-like cereal
plant (3)
16 Forms a layer over (5)
17 18th letter of the
Greek alphabet (5)
18 Military dictators (5)
19 Volley (5)
A
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4
S N O O P C A M E O
W P A O A D
A N T E N N A S A D
T S S C L
H U S K Y T O A D Y
H R
B L A D E C L A P S
O R V H E
N I P O R I G A M I
U E K P N Z
S I N G E S T A G E
2 6 5 1 3 2
8 6 7 9 9 7 3
6 1 3 2 8 9 5 7
9 3 8 8 4 9
4 9 2 5 8 6 1
1 2 5
8 4 3 1 9 2 6
1 6 2 9 8 2
3 5 1 2 9 8 7 4
7 3 1 2 3 4 1
9 7 8 5 6 9
4
4
4
4
4
4
4
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4
The nine-letter word was
GEARSTICK
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BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5
FRIDAY 5 OCTOBER 2012
STRICTLY COME DANCING
BBC1, 9PM
New series. The pro-celebrity contest
returns for its 10th season, as Bruce
Forsyth and Tess Daly host the first
of this weekends two live shows.
GARDENERS WORLD
BBC2, 8.30PM
Monty Don demonstrates jobs that
can be done in early autumn and
Carol Klein offers tips on caring
for agapanthus.
ISLAND HOSPITAL
ITV1, 8PM
Dean Robillard helps airlift a patient
to Princess Elizabeth Hospital and
physiotherapist Millie Rayner treats a
gardener recovering from pneumonia.
TVPICK
FRIDAY 5 OCTOBER 2012
32
THEPUNTER
SPORT TRADER
BEN CLEMINSON AND BILL ESDAILE PREVIEW THE WEEKENDS ACTION
NEWCASTLE beat Manchester United
3-0 last season to end a 10-year win-
ning drought against Sir Alex
Fergusons side. The Red Devils relin-
quished an even longer-standing
record last Saturday when Tottenham
tore them apart in the opening 45
minutes in a deserved 3-2 victory that
put paid to a 23-year stint without a
victory at Old Trafford.
A result like that had been threaten-
ing to happen over the past few weeks
as United had somewhat fortuitously
strung together a run of four straight
league wins. They have not been
helped by constant adjustments
required to the back four with the fit-
ness of Phil Jones, Rio Ferdinand,
Nemanja Vidic and Chris Smalling
proving unreliable.
Yet again, United had to do it the
hard way after more sloppy defend-
ing allowed Cluj to take an early lead.
However, Wayne Rooney continued
his rehabilitation by getting 90 min-
utes under his belt and the blossom-
ing partnership with Robin van Persie
looks set for big things. There will be
major concerns for United given that
was the sixth time in nine matches
they have conceded first, although no
club has come from behind more to
earn victories or draws this campaign.
Its clear that United have no wor-
ries in attack as they have already
bagged 19 goals since August. Van
Persie has contributed eight of those,
but its the back line that is jeopardis-
ing Uniteds title aspirations
Although Newcastle have not been
at their fluid best either, they thrive
in front of their passionate home sup-
port and will look to make life
extremely uncomfortable for the visi-
tors. The Magpies have struggled to
find much consistency domestically
and have secured only two league
wins, although both came
on Tyneside.
Demba Ba has responded in the
best possible fashion to being
benched for the Everton match
earlier this season by scoring all of
Newcastles last five league goals. He
also tore United apart on their last
visit here when he got the scoring
started with a sublime strike.
Alan Pardews side have a tendency
to move the ball from back to front
without much deliberation and this
is an area where the Magpies can gain
success against a susceptible centre-
back pairing. Newcastle have the
weapons to score, but United can
more than match that in the attack-
ing stakes. The hosts have drawn
three of their last four league games
this season, so back another stale-
mate at 13/5 with Coral.
Each side has only kept one clean
sheet from their six league fixtures
and, considering that, spread bettors
should buy goals at 2.8 with Sporting
Index. At around 14/1 with Coral, the
2-2 correct score makes some appeal.
NEWCASTLE...................................
MANCHESTER UNTIED...................
SUNDAY 4pm
An upset could be on
the cards at Upton Park
ARSENALS strong road record will
be firmly put to the test when the
Gunners head to Upton Park this
weekend. On their travels they are
unbeaten in the top flight this term
and have lost just once at Loftus
Road since mid-January.
But Arsene Wenger has repeatedly
failed to find a formula capable of
beating Sam Allardyces teams on
their own patch.
From the nine occasions that
Wenger opposed Allardyce at Bolton,
Newcastle and Blackburn in the
Premier League, he managed just
two wins, while Big Sam came out
on top four times. Add in to the
mix that West Ham are currently
one place and two points above
their guests in the table and
Saturdays early evening game is
set up rather nicely.
Arsenal will hardly be exhausted
by their midweek outing against
Olympiakos but the Hammers have
been able to put their feet up since
their 2-1 win at QPR on Monday.
Allardyce will hope that gives
New Zealand international
Winston Reid enough time to
recover from the concussion he
sustained during the game, with the
defender a mainstay of the side
which has taken 11 points from six
games so far.
One man who should definitely be
available for selection is Andy
Carroll, who made his comeback
with a 20-minute cameo against QPR.
Carroll scored the only goal in a 1-0
Newcastle win at the Emirates in
November 2010 in a very disciplined
Toon performance under then boss
Chris Hughton and it would be no
surprise to see Allardyce follow that
blueprint, despite being the home side.
Hammers fans have got used to a
more pragmatic approach to the
game than has been traditionally
required at Upton Park and it seems
to be working with only two home
league defeats in the past 12 months.
I am tempted by the 3/1 on offer
for West Ham to take all three
points, although it may be a better
option to have the hosts at 13/8 with
Coral in the draw no bet market.
Although their form has been
acceptable for the early stages of the
season, Wenger doesnt quite seem
to know his best team yet and recent
showings have not been that of
champions-in-waiting.
Whatever happens, Im
anticipating a tight, low scoring
game and the 15/2 with Coral for the
HT draw / FT West Ham double
result interests, as does a sell of total
goals at 2.7 with Sporting Index.
Red Devils set for more
frustration on Tyneside
nPointers
Draw at 13/5 with Coral
2-2 correct score at 14/1 with Coral
Buy total goals at 2.8 with Sporting Index
nPointers
West Ham draw no bet at 13/8 with Coral
HT draw / FT West Ham at 15/2 with Coral
Sell total goals at 2.7 with Sporting Index
WEST HAM.....................................
ARSENAL ......................................
TOMORROW 5.30pm
Manchester United face a tough domestic test away to a confident Newcastle team
33
SPORT TRADER
cityam.com
FRIDAY 5 OCTOBER 2012
THE defection of three of this years leading
contenders in Snow Fairy, Nathaniel and
2011 winner Danedream has taken away
some of the lustre from the prestigious Prix
De LArc De Triomphe on Sunday (3.25pm).
The trio, ruled out through injury or, in
Danedreams case, after a virus outbreak in
her native Germany, should have made this
one of the most competitive Arcs for years.
However, the will-he-wont-he saga sur-
rounding this years 2000 Guineas and Derby
winner Camelot has ended. Aidan OBrien
confirmed the Montjeu colt a starter with
Frankie Dettori riding. That has seen the
three-year-old, beaten in the St Leger in his
Triple Crown attempt, come in for sustained
support and he is now jostling for
favouritism with Japanese raider Ofevre.
I cant have those two at the prices with
Ofevre too short after an Arc trial win that
told us very little. He is a class act but the
four-year-old has to concede weight to the
Classic generation who have won 15 of the
last 18 renewals. Camelot had a hard race at
Doncaster and rarely does a horse win this
race as an afterthought.
Although the age group do have a great
record in the contest, this years three-year-
olds arent a vintage bunch. The likes of
Saonois, Masterstoke and Kesampour have it
to prove and in SHARETA we might just
strike gold.
The daughter of Sinndar, the Arc winner
in 2000, may be four but gets a weight
allowance from the males. She was consid-
ered the Aga Khans second-string in the race
last year, going off 66/1, but plugged on well
to keep second having made the pace. She
has proved that effort was no fluke with a
series of solid efforts in top company since
and arrives on the back of two Group One
successes. Sharetas form in the French capi-
tal reads 1321 and a repeat of her perform-
ance 12 months ago should see Alain De
Royer-Dupres tough filly at least hit the
frame at 7/1 with Coral.
The Prix De LAbbaye over five furlongs
looks a difficult race to start the day but
HAMISH MCGONAGALL makes plenty of
appeal. Unlike a lot of sprinters Tim
Easterbys charge always runs his race and
he hasnt been overlooked by bookmakers, as
short as 12/1 with Coral.
WHAT A NAME at 2.05pm is unbeaten
over this seven-furlong trip and was impres-
sive at Longchamp last time out. The Mikel
Delzangles-trained filly is taken to beat the
boys who, on the whole, look a pretty
exposed bunch. Aidan OBrien won this race
five times in six years between 2001 and
2006 but both his entries, George Vancouver
and Pedro The Great, are unproven over
the distance.
The last horse to catch my eye is GORDON
LORD BYRON in the Prix De La Foret
(4.55pm) in what must be one of the weakest
Group Ones for years. Only
Starspangledbanner has won at the highest
level before and that was back in July 2010.
After a failed stud career the Australian
import returned to a bit of form in Ireland
last time but whether he wants such a test of
stamina is open to debate.
My selection has improved tremendously
over the past season and his Listed success
over this distance two starts ago was mighti-
ly impressive. He ran a cracker on ground
that would have been too quick in the
Haydock Sprint Cup and, back on this softer
surface, the Irish gelding should make a
bold bid.
Shareta to bring up
win number five in
the Arc for leading
owner Aga Khan
nPointers
HAWAAFEZ 2.30pm Ascot (tomorrow)
GHURAIR 2.50pmNewmarket (tomorrow)
SOUL e/w 3.05pmAscot (tomorrow)
GLOBAL VILLAGE e/w 3.35pm Ascot (tomorrow)
ANGELS WILL FALL e/w 4.25pmNewmarket (tomorrow)
IT HAS been a season to
remember for John Gosden
and, although he will be
devastated that Nathaniel is
unable to travel to Paris for
the Arc, compensation
potentially awaits back at
Newmarket in the 500,000
Tattersalls Millions (2.50pm).
GHURAIR won what turned
out to be a very hot maiden
at the July meeting and, even
though he was a shade
disappointing in the Vintage
Stakes at Goodwood, he
has been rested since and
should be very hard to
beat tomorrow.
The Elusive Quality colt
still has an entry in the
Dewhurst and Racing Post
Trophy, but there is huge
prize money on offer here
and a win would make it very
difficult for Aidan OBrien to
overhaul Gosdens lead in the
trainers championship.
Richard Hannons Havana
Gold and Tamayuz Star look
the chief dangers, but I dont
think they have the potential
of Ghurair, who can take
this before a possible tilt at
the QIPCO 2,000 Guineas
next season.
Later on the card Im quite
keen on the chances of Charlie
Hills ANGELS WILL FALL in
the Listed fillies sprint at
4.25pm. She was trapped
behind a wall of horses at
Newbury last time and would
have finished much closer
than eighth had the gaps
emerged. Robert Winston gets
on with her well and she
finished an excellent third in
the Group One Cheveley Park
last season.
There is some cracking
action at Ascot tomorrow and
my first fancy is Marcus
Tregonings HAWAAFEZ in
the Cumberland Lodge Stakes
(2.30pm). She was well
supported at Goodwood last
time, but could only manage
fourth behind Wild Coco who
has since gone in again at
Doncaster. There is plenty of
rain forecast in the area and
that will suit this daughter of
Nayef perfectly.
This is a race Tregoning
always targets and hes not
done badly at all with four
wins from the last nine
runnings. Johnny Murtagh is a
very positive booking as there
wouldnt be many better at
judging front-running rides on
the round course. Its a highly
competitive race, with not
much between the entire field
on ratings, but this filly has
always been well regarded and
could come back here again on
QIPCO British Champions Day.
Mince is going to be a very
warm order in the John Guest
Bengough Stakes (3.05pm)
following her quick-fire hat-
trick. She broke the track
record here in August, but
most of her best form has been
on quick ground and Im going
to oppose her at the likely
prices. Godolphins SOUL was
disappointing at Doncaster last
time, although he met with
some interference, and he will
relish any softening of the
ground. He was fourth in the
Golden Jubilee behind Black
Caviar and a repeat of that
run would be good enough to
win this.
The big betting race of the
day is the Challenge Stakes
(3.35pm) where Captain
Ramius bids to follow up his
emphatic Ayr Gold Cup
victory. He wont be far away
but Id prefer to back old
friend GLOBAL VILLAGE each-
way at 20/1 with Coral. The key
to Brian Ellisons seven-year-
old is plenty of cut in the
ground and he has run some
cracking races over course and
distance this season.
You can follow me on
Twitter @BillEsdaile for all my
racing views.
Classy colt Ghurair can move John
Gosden one step nearer to the title
French star Shareta can go one better in the Arc this year
nPointers
HAMISH MCGONAGALL e/w 12.55pm (Sunday)
WHAT A NAME 2.05pm (Sunday)
SHARETA e/w 3.25pm (Sunday)
GORDEON LORD BYRON 4.55pm (Sunday)
1700+ Shops Text CITYAM
to 82211
coral.co.uk/cityam 0800 242 232
THREE &
EASY
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If a team wins by
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well refund losing
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TONIGHTS LIVE
FOOTBALL
5/4 Inverness 9/4 Draw Ross County 11/5
Scottish Premier League, Kick-off 7.45pm, Live on ESPN
5/1 R. Foran (I)
11/2 B. McKay (I)
11/2 P. Roberts (I)
13/2 S. Morrow (R)
13/2 A. Shinnie (I)
13/2 C. McMenamin (R)
13/2 J. Oswell (I)
15/2 G. Glen (R)
5/1 R. Foran (I)
11/2 B. McKay (I)
11/2 P. Roberts (I)
13/2 S. Morrow (R)
13/2 A. Shinnie (I)
13/2 C. McMenamin (R)
13/2 J. Oswell (I)
15/2 G. Glen (R)
FIRST GOALSCORER
LAST GOALSCORER
THREE & EASY: Applies to First / Last Goalscorer and
correct score markets on tonights Live domestic matches.
Others on request. Prices subject to uctuation.
CORRECT SCORE
8/1 0-0 8/1
7/1 1-0 8/1
11/2 1-1 11/2
8/1 2-0 12/1
15/2 2-1 10/1
14/1 2-2 14/1
20/1 3-0 33/1
20/1 3-1 28/1
Inverness R. County Inverness R. County
LONDON 2012 bronze medallist
Anthony Ogogo has admitted the lure
of turning professional may yet
dissuade him from choosing to pursue
his dream of boxing in Rio in 2016.
The 23-year-old middleweight has had
offers from professional promoters after
impresssing throughout the London
Olympics where he defeated the world
No1 Ievgen Khytrov of Ukraine, but
while there remains a hunger to pursue
another medal in Brazil in four years
time, he has revealed that the
prospect of earning money could
take his career elsewhere.
It will be nice to build on the
success, go to the worlds and medal and
then go to Rio as one of the favourites,
Ogogo said. I have a burning desire to
do that. But on the other hand Ive got
the option of turning professional.
LIVERPOOL manager Brendan
Rodgers blamed the poor perform-
ance produced by his players imme-
diately after half-time for the rapid
transformation with which
they went from an apparently com-
fortable position to a damaging
home defeat.
Midfielder Jonjo Shelvey capped a
fine, flowing passing move with an
authoritative header to give
Liverpool a deserved 23rd-minute
lead but a goal straight after half-
time from Udineses record
goalscorer Antonio Di Natale fol-
lowed by two in three minutes later
on in the game left the home side
with too much to do as Luis Suarezs
free-kick did little beyond reducing
their deficit.
We were very, very good in the
first half, said Rodgers. The prob-
lems we had in the first 15 minutes
of the second half has been with us
since the beginning of the season
when we lose concentration and get
lazy, and all of a sudden in that peri-
od we found ourselves 3-1 down.
Were just disappointed that,
after such a good first-half of con-
trol and domination, to go and give
away such poor goals at the begin-
ning of the second-half obviously
left us chasing the game at 3-1.
We just concede goals too easily
and thats something we need to
improve on.
The defeat was Liverpools third
consecutive at Anfield but one that
in this instance they were perhaps
unfortunate to have to undergo.
They are now third in Group A on
with one loss and one defeat from
the two European games but the
control and style exhibited in the
opening half was undermined only by
a lack of true quality when it counted
in front of goal.
Di Natales cultured finish for the
equaliser came only 32 seconds into
the second-half, and soon Sebastian
Coatess headed own goal and
Giovanni Pasquales powerful low
strike left the home side two behind.
The substitute Suarez curled a mas-
terful free-kick into Udineses top cor-
ner with 15 minutes to go but though
he, Raheem Sterling and more went
close, the vital equaliser did not come.
Anthony Ogogo is an Olympic medallist
35th-minute lead but an
inability to convert their
dominance was their ultimate
downfall when Spanish striker
Toche equalised by sliding in to
send the ball past Hugo Lloris.
Beyond resting first-choice
goalkeeper Brad Friedel for the
14m Lloris, Spurs begun with a
near-full strength side for a
competition manager Andre
Villas-Boas wishes to win. He
said: Im obviously
disappointed with the result.
FRIDAY 5 OCTOBER 2012
34
SPORT
cityam.com/sport
BY DECLAN WARRINGTON
SIR Clive Woodward is to resign as the
British Olympic Associations director
of sport but will retain an
ambassadorial role and his seat on the
entourage commission of the
International Olympic Committee.
Post London 2012 is the right time
for me to leave the BOA, which is now
taking a new direction following a
home Games and I wish them all well
in the future, said Woodward. I will
now be concentrating on my coaching,
corporate speaking, media and other
business interests.
LIVERPOOL.................................2
UDINESE.....................................3
BY DECLAN WARRINGTON
EUROPA LEAGUE
@cityam_sport
Rodgers riled
by poor second
half showing
Tottenham drop points late on
PANATHINAIKOS.........................1
TOTTENHAM................................1
EUROPA LEAGUE
PANATHINAIKOS scored an
equaliser with 13 minutes to go to
deny Tottenham a true extension
to their run of good form.
A header from captain Michael
Dawson had given Spurs a deserved
seven changes to his side but they
took the lead in the 16th minute
with a sidefooted finish from
Shola Ameobi after Gabriel
Obertans cross and they
thereafter never looked back.
The home sides lead was
doubled five minutes before half-
time when the returning Danny
Simpsons cross was sent
goalwards by Bordeaux defender
Henrique and Papiss Cisse finished
well, despite appearing offside, for
their third just after the break.
Newcastle cruise to victory
NEWCASTLE ...............................3
BORDEAUX................................0
EUROPA LEAGUE
NEWCASTLE won their first match in
Group D after a dominant display
against Frances Bordeaux.
With a weekend fixture against
Manchester United to prepare for,
manager Alan Pardew had made
Ogogo ready to
consider the pros
BY DECLAN WARRINGTON
Woodward set to
leave BOA role
Sebastian Coates (centre) headed an own goal to give the visiting Udinese the lead
35
IN BRIEF
Holt ridicules England omission
nFOOTBALL: Norwich striker Grant
Holt has admitted he gave up on an
England call up at the end of last
season, calling his exclusion
ridiculous. He said: I think Ill
never be in it. Roys come in and is
picking his players. When two
friendlies came up and I wasnt
included, it was ridiculous to
be honest.
Baileys season likely to be over
nRUGBY UNION: Wasps wing James
Bailey appears set to miss the rest of
the season after breaking his leg
against Northampton last Friday.
Results
Going off to England because he is short on
match fitness would be a good thing for us and a
good thing for him West Ham manager Sam Allardyce on Andy Carroll
cityam.com
FRIDAY 5 OCTOBER 2012
FINAL 2013
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ENGLAND manager Roy Hodgson has
apologised to Rio Ferdinand after details
of his latest omission from the national
squad were leaked following a
conversation the 65-year-old had on the
London underground when heading to
Arsenals 3-1 Champions League victory
over Olympiakos on Wednesday.
Hodgson yesterday announced his 25-
man squad for the imminent World Cup
qualifiers against San Marino and Poland
but even if it was a development that was
already largely expected, the manager felt
it wrong such news had emerged that way.
I apologise to [Ferdinand], said
Hodgson. There is no way I would
indicate that I would not use a player in
this way. I have tried to get in touch with
Rio and I am disappointed that a stray
conversation has been reported that way.
Hodgson holds hands up for Rio gaffe
Englands 25-man squad in full
nJoe Hart
Manchester City
nJohn Ruddy
Norwich City
nFraser Forster
Celtic
nGlen Johnson
Liverpool
nKyle Walker
TottenhamHotspur
nAshley Cole
Chelsea
nKieran Gibbs
Arsenal
nLeighton Baines
Everton
nGary Cahill
Chelsea
nPhil Jagielka
Everton
nJoleon Lescott
Manchester City
nRyan Shawcross
Stoke City
nJames Milner
Manchester City
nAaron Lennon
TottenhamHotspur
nA Oxlade-Chamberlain
Arsenal
nSteven Gerrard*
Liverpool
nMichael Carrick
Manchester United
nFrank Lampard
Chelsea
nTom Cleverley
Manchester United
nAdam Johnson
Sunderland
nTheo Walcott
Arsenal
nJermain Defoe
TottenhamHotspur
nWayne Rooney
Manchester United
nDanny Welbeck
Manchester United
nAndy Carroll
West HamUnited
*Steven Gerrard is the full England
captain
England manager Roy Hodgson (above) continues to overlook Manchester United defender Rio Ferdinand

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