Need to Know: Global Business Briefing

The US Treasury Secretary, Henry Paulson, is to address British business leaders at the CBI conference next week, the employers’ organisation announced. Mr Paulson will take part in a discussion of the global economy with CBI delegates and Gordon Brown, the Chancellor.

The French economy stagnated in the third quarter, with growth dropped to zero, after a buoyant 1.2 per cent for the second quarter, official figures confirmed. The sudden halt in France’s economic expansion was driven by a sharp running down of stocks.

Bank of Japan Minutes of the last meeting of the Bank of Japan’s policy-making board expressed optimism over prospects for the world’s second-largest economy but did little to dispel the markets’ uncertainty over when the central bank might next raise rates.

India and China will work to double the value of their bilateral trade to some $40 billion a year by 2010, Manmohan Singh, the Indian Prime Minister, said after talks in New Dehi with Hu Jintao, China’s President. Bilateral trade between the two nations is worth about $20 billion (£10.5 billion) a year at the moment.

Banking & finance

Down 0.1%

London Stock Exchange Samuel Heyman, the US corporate raider, has taken an 8.8 per cent interest in the London Stock Exchange at £12.90 — 47p higher than the hostile bid tabled by Nasdaq, the US exchange, earlier this week. The underlying shares would be enough to make Mr Heyman the second-largest holder in the LSE behind Nasdaq.

Standard & Poor’s, the ratings agency, gave warning that loan defaults could “spike up” as companies take on increasing quantities of debt to fund this year’s unprecedented boom in mergers and acquisitions. The rating on the majority of the bonds and loans being issued by US companies entering the debt market for the first time has fallen by about 1.5 notches in the past two years.

Icap, the inter-dealer broker, said that it is prepared to provide the necessary infrastructure for any eventual attempts to break the monopoly of the London Stock Exchange and other world exchanges. Separately, Icap reported a 23 per cent rise in first-half profits, buoyed by active trading conditions in global financial markets to £120.8 million, up from £98.2 million last year.

Aviva, Britain’s largest insurer, will consult its policyholders over the distribution of its £4 billion inherited estate, raising the possibility of a £3,270 windfall for each holder.

Construction & property

Up 0.5%

British Land, the City office developer, reported half-year pre-tax profits of £670 million, down from £743 million last year and proposed a 5.6p dividend, up from 5.2p last time.

Invista European Real Estate Trust, the closed-ended investment company, plans an initial public offering and intends to seek a listing on the London Stock Exchange’s main market for listed securities. The IPO is expected to raise about £166.2 million and the company’s total market capitalisation is expected to be worth about £207.8 million.

Telford Homes, the London-based housebuilder, unveiled a rise in half-yearly pre-tax profits from £3.3 million in 2005 to £7.2 million this year, while sales rose by 89 per cent.

Consumer goods

Down 0.1%

SABMiller, the brewer, is to invest $100 million (£53 million) upgrading the three breweries owned by Kompania Piwowarska, its Polish subsidiary, most of which will go into the Tyskie brewery near Krakow, in Silesia.

Uniq, the chilled foods maker, reported a pre-tax half-year loss of £43.1 million, compared with a loss of £14.4 million last year, and plans to focus on its profitable businesses, including supplying sandwiches to Marks & Spencer, the high street retailer.

Unilever, the Anglo-Dutch consumer group, is to reshape the organisation of its European food research and development team, reducing some 60 centres to 29 sites, incurring the loss of 240 jobs.

Engineering

Down 0.3%

Boeing, the US aerospace group, has won an order for 25 planes from Korean Airlines in a deal worth $5.5 billion (£2.9 billion) at list prices and the largest commercial airplane commitment in Korean history.

Military establishments are to be equipped solely with non-charging systems that could save those serving in the Armed Forces an estimated £18 million over the next seven years. In return, Forces Financial, which provides insurance deals for many service personnel, and Bank Machine, a division of Cardtronics, which has cash machines across the United States, will be able to advertise on the ATM screens.

Smiths, the British aerospace group, said in an update that it was trading in line with expectations, with all four of its divisions making progress.

Health

Down 1%

Eli Lilly, the US drugs making giant, has been given permission by European regulators to market a drug developed from the venomous saliva of a rare Mexican lizard for the treatment of diabetes. The drug will be pitched to Europe’s 48 million diabetics.

UCB, the Belgian drugmaker, announced that it has won European Union approval to take over Schwarz Pharma, its German rival, clearing the last regulatory hurdle to the deal. It will create a company with revenue of more than $3.3 billion (£1.7 billion) and annual research and development spending of $770 million.

Pfizer, the US pharmaceuticals giant, and Teva Pharmaceutical Industries, the Israeli generic drugs manufacturer, have resolved their differences over Teva’s sale of generic versions of Pfizer’s Zithromax antibiotic and Idamycin cancer treatmemt. Teva will pay Pfizer up to $70 million to continue to market its generic versions of the drugs.

Actavis, the Icelandic pharmaceuticals and generic medicine group, said that it had bought a 51 per cent stake in ZiO Zdorovje, the Russian laboratory. Of the €47 million Actavis is paying for the stake, €23 million are earmarked for new product development and increasing production capacity.

Industrials

Up 1.9%

Tata Steel The board of the Indian steelmaker will meet in Bombay to consider a revised offer for Corus, the Anglo-Dutch steel group. Companhia Siderúrgica Nacional, its Brazilian rival, has topped Tata’s offer for Corus with a £4.26 billion approach.

Xstrata Workers belonging to the United Steelworkers union at Xstrata Aluminum’s Norandal plant in Salisbury, North Carolina, have agreed a three-year labour agreement. The FTSE-100 listed Xstrata produced 177,900 tonnes of rolled aluminium products at Norandal last year.

Leisure

Up 0.6%

Enterprise Inns, the FTSE 100 tenanted pub company, said some of the high prices paid in recent pub deals could come home to haunt the purchasers as many of the deals were being driven by the availability of large amounts of cheap debt funding rather than by the quality or sustainability of the pubs.

WH Brakspear, the pub operator which is based in Henley-on-Thames, has been acquired by JT Davies, the family controlled pub company and its biggest shareholder, for £106 million.

Media

Down 0.2%

ITV, the commercial broadcaster, has rejected NTL’s £4.7 billion takeover bid, claiming that it lacked any logic and was too cheap to be worth discussing face to face.

BSkyB’s swoop on ITV was described as anti-democratic by Sir Richard Branson, chairman of Virgin Group, as he tried to whip up political opposition to Friday’s share raid on the commercial broadcaster. The satellite broadcaster is 39.1 per cent owned by News Corporation, parent company of The Times.

Viacom’s Sumner Redstone, chairman of the media giant, is being sued by his nephew Michael Redstone for as much as $4 billion (£2.1 billion) as the feud that has dogged the American dynasty for generations deepened.

Natural resources

Up 0.1%

Mitsui Oil (Asia), the offshoot of Mitsui, the Japanese conglomerate, has launched an investigation into how a rogue trader had been able to conceal a disastrous investment strategy for more than six months before confessing to an $81 million (£42 million) loss. The Singapore-based trader hid the losses after making wrong bets on the price of naptha — a raw material used in the petrochemical industry.

Retailing

Down 0.1%

SCS Upholstery, the sofa retailer, reported a slight increase in half-year profits from £17.1 million to £17.2 million, offering shareholders a 12p dividend to be paid in February, up from 10.5p in 2005.

Signet, the world’s biggest jewellery retailer, said its ranges of “collection” jewellery had helped it halve its losses in the UK and added that it was well positioned for Christmas.

Theo Fennell is stocking a more expensive range of jewellery to meet demand from City workers who have enjoyed record bonuses as well as visitors from Russia and the Middle East.

Argos, the catalogue retail group, has doubled the capacity of its internet site as it expects 30 per cent more customers to shop online this Christmas.

Support services

Up 0.6%

Rentokil Initial Merrill Lynch has been placing shares in Rentokil Initial, the services group, worth £20 million, according to dealers. They added that the US investment bank was selling 14 million Rentokil shares at 150p each.

Experian, the credit information company spun out last month by GUS, reported a 16 per cent rise in first-half profits and said it will expand in China and Latin America.

Technology

Up 0.1%

Google’s shares rose past the anticipated $500 milestone for the first time, continuing the internet search engine’s strong climb since it became a public company in August 2004.

Euronet Worldwide, the electronic payments provider, has agreed to acquire RIA Envia, the privately held money transfer company, for about $490 million (£258 million) in cash and stock.

RM, the education software supplier, has been named preferred bidder by Knowsley Metropolitan Borough Council for a key computer contract.

Telecoms

Up 1%

BT Tough rules around BT’s supply of broadband to rival players could be rewritten after a review by Ofcom, the regulator. Ofcom had ruled in 2004 that BT had a dominant position in wholesale broadband provision across the UK and had imposed rules accordingly.

Oger Telecom, the Dubai-based telecoms operator that had been set to be the latest foreign company to list in London, has cancelled its plans for a $1.25 billion (£660 million) flotation.

Transport

Up 2%

The Shipbuilders Council of America has filed a lawsuit in the District Court of Virginia to stop Matson Navigation from sending ships to China to be upgraded. The body is said to be concerned about the number of US ship owners who are sending their vessels overseas for repair work.

Utilities

Up 1.2%

Suez shareholders threatened to scupper the merger between the Franco-Belgian utility and Gaz de France, its French rival, unless they received a dividend of more than €3 as compensation for the 34 per cent stake held by the French State in the new group.

Nuclear fusion A groundbreaking attempt to change the way nuclear energy is commercially produced has been agreed by the European Union, the United States, China, India, Japan, Russia and South Korea.

sectors@thetimes.co.uk

Up/Down = sector index percentage change