Visit the Hellenic Society of Virology (HSV) Homepage Read the Convention Relating to the Regime of the Straits (24 July 1923) Read the Convention Relating to the Regime of the Straits (24 July 1923)
HR-Net - Hellenic Resources Network Compact version
Today's Suggestion
Read The "Macedonian Question" (by Maria Nystazopoulou-Pelekidou)
HomeAbout HR-NetNewsWeb SitesDocumentsOnline HelpUsage InformationContact us
Thursday, 28 March 2024
 
News
  Latest News (All)
     From Greece
     From Cyprus
     From Europe
     From Balkans
     From Turkey
     From USA
  Announcements
  World Press
  News Archives
Web Sites
  Hosted
  Mirrored
  Interesting Nodes
Documents
  Special Topics
  Treaties, Conventions
  Constitutions
  U.S. Agencies
  Cyprus Problem
  Other
Services
  Personal NewsPaper
  Greek Fonts
  Tools
  F.A.Q.
 

European Business News (EBN), 97-09-05

European Business News (EBN) Directory - Previous Article - Next Article

From: The European Business News Server at <http://www.ebn.co.uk/>

Page last updated Fri, September 05 6:20 PM CET


CONTENTS

  • [01] Mannesmann to pay $1.5 billion to set up joint venture with Olivetti
  • [02] Air France chief quits in row over privatisation
  • [03] US jobless rate edges up to 4.9% as UPS strike slows jobs growth
  • [04] White House says strong dollar will brake exports and contribute to moderate economic growth over next five years
  • [05] Misys to pay $922.8 million for Medic Computer of US
  • [06] Credit Suisse holders clear Winterthur merger, $1 billion capital increase
  • [07] Amoco reportedly plans to merge South American assets with Bridas of Argentina
  • [08] French economic growth picked up speed in the second quarter
  • [09] German tax reform plan is again rejected
  • [10] Ekran plans to seek new contractor for the Bakun dam project
  • [11] Schroders reports first half profit up 13% to record $200 million
  • [12] Olympic bidders make final presentations in Lausanne

  • [01] Mannesmann to pay $1.5 billion to set up joint venture with Olivetti

    Mannesmann said it will pay a total of $1.5 billion to set up a telecoms joint venture with Italy's Olivetti.

    Olivetti will spin off its controlling stakes in Omnitel Pronto Italia and Infostrada to the new joint venture.

    German industrial group said it will initially buy a 25% stake in the venture for 1.1 billion Deutsche marks ($604 million). That will be followed by the purchase of a second share in the venture for an additional 1.3 billion marks ($939.2 million), bringing its total stake in the joint venture to 49.9%.

    Mannesmann said it would also take a 25% share in a capital injection and a convertible loan - each totalling a maximum 335 billion lire ($188.8 million) - for Olivetti.

    The venture aims to strengthen Olivetti's leading position as a private competitor in Italy's telecommunications market, Mannesmann said.

    Mannesmann's D2 mobile telephone network, number two in Germany after Deutsche Telekom , is in the same position as Omnitel in the Italian market, which is the largest private competitor to Telecom Italia.

    Mannesmann already holds 8% of Omnitel. AirTouch, Bell Atlantic, CCIL and Telia are also stakeholders in Omnitel.

    Mannesmann said it will at first buy a 25% stake in the venture for 1.1 billion marks, and follow with the purchase of a second stake for 1.3 billion marks, for a total stake of 49.9%.

    Olivetti will use the funds to reduce debt and finance the expansion of Infostrada's fixed network.

    The deal must still be approved by the supervisory boards of the two companies, and regulatory authorities.

    Mannesmann said it will participate in both the capital boost and the convertible bond transactions with an amount equaling 25% of each. In this way, Mannesmann will take a small share in Olivetti. A spokesman couldn't say what the size of the share would be.

    'With more than 1.5 million cellular subscribers, Omnitel is as of now the only competitor to Telecom Italia in the mobile phone market. Infostrada offers voice, internet, data and other wireline telecoms services to business and private customers,' Mannesmann said.

    [02] Air France chief quits in row over privatisation

    Air France chairman Christian Blanc resigned after the Socialist-led French government refused to bow to his demands to privatise the state airline, the company said.

    'He is leaving,' a spokeswoman said.

    On Thursday, Prime Minister Lionel Jospin insisted he would not privatise Air France, but said he hoped Blanc would stay on as chairman.

    The government, 'confirms the privatisation of Air France is not on the agenda, as has been indicated to the company chairman since the first talks he has had with the Prime Minister and the Minister of Transport,' a statement from Jospin's office said.

    Jospin said: 'The government wants Air France to have all the advantages necessary for its development to the first rank of the world's air companies.

    'It is notably determined to carry out changes -- opening up the capital, worker participation, adaptation of management structures -- allowing the company to create international alliances necessary for this development.'

    Blanc has said Air France needs to be privatised to allow it to forge alliances with other carriers in an increasingly competitive international climate.

    [03] US jobless rate edges up to 4.9% as UPS strike slows jobs growth

    The U.S. jobless rate edged up to 4.9% in August, from 4.8% the month before, as the 16-day United Parcel Service strike dampened job growth, the Labor Department said.

    The agency's monthly payroll survey showed 49,000 new jobs were created outside the farm sector during the month.

    The rise in non-farm payrolls came in below analysts' expectations. A Dow Jones Newswires survey of economists found a median estimate of up 70,000. For the unemployment rate, economists expected a rate of 4.8%, for August.

    The Labor dispute involved 185,000 Teamsters union members. But the net impact of the strike was smaller after accounting for hiring elsewhere in the transportation industry and by the U.S. Postal Service to help meet demand for parcel delivery, according to Katharine Abraham, commissioner of the Bureau of Labor Statistics.

    Overall, the transportation sector lost 160,000 jobs, the largest decline on record.

    Despite the modest gain in August payrolls, job growth for July was revised upward, to an increase of 365,000 from an initially reported gain of 316, 000. The July increase was the largest since a 492,000 gain in February 1996.

    'Overall this is a palatable number for unemployment, but it's a number that will undergo constant scrutiny because of the effect of the UPS strike, ' said Alan Ackerman, market strategist at Fahrenstock.

    'It appears to have little wage inflation and certainly the number of new jobs was below what was expected.'

    [04] White House says strong dollar will brake exports and contribute to moderate economic growth over next five years

    The White House predicted that the strong dollar will likely act as a brake on exports and will contribute to the moderate economic growth it foresees for the next five years.

    In its mid-session review of the economy, the White House said, 'The Administration expects the recent rise in the dollar to restrain the growth of net exports for some time to come.'

    For the next five years, the White House sees economic growth averaging between 2.0% and 2.4% on a real, chain-weighted basis.

    Other factors that will keep economic growth modest will be the fact that pent-up demand for consumer durable goods that built up in the last recession has now largely been satisfied, 'and will not likely provide a significant stimulus to consumer spending.'

    The White House also foresees a slowdown in housing starts to more typical levels because of shifts in the nation's demographics. This in turn will cause a downturn in residential investment, it said. The U.S. economy is set to expand by 2.8% in 1997 in real, chain weighted terms, a slight slowdown from the 1996 level of 3.2%, according to the review. Growth will continue to slow in 1998 and 1999 and should only hit 2.0% for both years.

    After that, the administration predicts a steady rise in economic growth to 2.2% in 2000 and 2.4% in 2001 and 2002.

    The moderate growth in the economy will help keep unemployment levels at modest levels with the unemployment rate averaging 5.0% in 1997, a drop from the actual average of 5.4% in 1996. For the out years, the average unemployment rate will climb to 5.2% in 1998 and to 5.4% in 1999. For the years 2000 through 2002, the average unemployment rate will be 5.5%, according to the administration.

    Despite the steady growth and low unemployment, inflation won't be a major factor in the economy for the foreseeable future. Inflation, as measured on a fourth quarter over fourth quarter basis, will be 2.4% in 1997, down from 3.2% in 1996. In 1998, the inflation figure will rise slightly to 2.6% and will be steady at 2.5% for the years 1999 through 2002.

    On a year over year basis, inflation will be 2.7% in 1997, down from 2.9% in 1996. For the out years, inflation will hold steady at 2.5% from 1998 through 2002.

    Interest rates will also be steady at low through 2002, according to the administration. For 1997, 10-year Treasury notes should yield 6.6%, up from their yield in 1996 of 6.4%. For 1998, 10-year Treasury notes will yield 6.1% and will decline steadily thereafter to 5.4% in 2002.

    Budget deficits will take a more roller coaster route over the next five years by starting low, then spiking higher before disappearing altogether.

    For the current fiscal year, the White House predicts the deficit will be $37.3 billion before rising to a high of $58.3 billion in fiscal year 1998. For the remaining years, the White House predicts a deficit of $57.4 billion in fiscal year 1999, $41.4 billion in 2000 and $7.0 billion in 2001.

    For the fiscal year 2002, the deficit will reverse into a surplus of $63.1 billion and climb steadily after that. In fiscal year 2007, the farthest year out the White House made forecasts for, the surplus will be $166.8 billion.

    [05] Misys to pay $922.8 million for Medic Computer of US

    Misys said it plans to buy US healthcare software provider Medic Computer Systems for $922.8 million in a take-over supported by Medic's management.

    The UK computer systems and services company said it planned a two-for- seven rights issue to raise around £321.5 million ($509.9 million) net to finance the acquisition. It said the acquisition was expected to be earnings neutral in the first full year.

    Misys said NASDAQ-listed Medic was one of the five largest healthcare information technology companies in the U.S.

    'Misys is strategically positioned in markets...where spending on IT is set to grow most strongly. Medic is one of the leading players in this market, has modern products and a large customer base with resilient revenue streams,' Misys chairman Kevin Lomax said.

    Last year, Medic reported income before taxes of $38.9 million on total revenues of $191.8 million, Misys said.

    The British company said Medic's current management team would be retained for at least three years.

    An existing shareholders' and stock option agreement already gives Misys control of 19.9% of Medic's share capital, Misys said.

    Medic's software and systems supply both the managed healthcare and fee-for- service markets.

    Medic makes, sells and supports physician practice management systems.

    Spending in the U.S. on healthcare information technology has accounted for only about 2% of operating overheads in the U.S., Misys said. It estimates spending has grown at a 17% compounded annual rate in the past two years and sees that rising to 25% up to 2000.

    [06] Credit Suisse holders clear Winterthur merger, $1 billion capital increase

    Credit Suisse shareholders approved the Swiss bank's planned merger with insurer Winterthur and a capital increase of $1 billion to help finance the merger and pay for future acquisitions.

    Chairman Rainer Gut said the move will help earnings in the second half, leading to good results for the year. Gut also said he sees 'above-average growth opportunities' in markets where the two companies have a joint presence and expects enhanced competitiveness due to lower product and sales costs. Finally, further synergies will be available in a variety of areas.

    He said the merged group will rank among the '10 strongest financial services companies in the world.'

    Credit Suisse holders also cleared a capital increase of up to 1.5 billion Swiss francs ($1 billion) or 75 million registered shares with a nominal value of 20 francs each. Around 71 million shares will be used to fulfil the share exchange between CS and Winterthur. The remaining shares will be kept as a reserve to pay for future acquisitions.

    The chairman of the board, Gut, made clear, however, that CS currently hasn't got any firm acquisition plans.

    Shareholders also approved of the election of Winterthur's chairman Peter Spaelti and member of the board Marc-Henri Chaudet as new members of the board of directors.

    Shareholders of Winterthur are scheduled to meet later in the day. If the insurer's stockholders approve the merger, Credit Suisse will proceed with a public offer for Winterthur shares.

    The exchange offer will be made at a ratio of 7.3 CS registered shares for each Winterthur registered share. The offer will be made in early autumn. Exact timing depends on the status of the regulatory approval process.

    The companies expect to complete the stock swap by the end of 1997.

    [07] Amoco reportedly plans to merge South American assets with Bridas of Argentina

    Amoco has agreed to merge its oil and natural-gas business in South America's southern region with closely held Bridas of Argentina, creating a venture with more than $3 billion in assets, people familiar with the deal told The Wall Street Journal.

    The transaction, which could be announced as soon as today, will give Amoco 60% of what will be Argentina's second-largest oil and natural-gas company, behind YPF. Bridas will control 40% of the venture, the people said.

    The new company, which hasn't been named, will have about 750 million barrels in proven reserves plus Bridas's large undeveloped acreage in Argentina.

    Because Bridas will contribute properties that are considerably more valuable than Amoco's properties, the Chicago-based company is expected to pay Bridas hundreds of millions of dollars. Neither Amoco nor Bridas would comment on the transaction, and its exact terms couldn't be learned.

    Bridas, controlled by Argentina's Bulgheroni family, is currently the nation's third-largest oil and natural-gas company, with proven domestic oil reserves of 80 million barrels of oil and almost 1.8 trillion cubic feet of natural gas. Though the size of Bridas's reserve portfolio is relatively modest, the company holds valuable exploration interests in more than 17 million undeveloped acres, mostly in Argentina.

    The deal doesn't include Bridas's oil and gas interests in the Caspian region of Turkmenistan. A continuing dispute with the Turkmenistan government has forced the closure of some of Bridas's fields there.

    Amoco's venture with Bridas will be in a strong position to take advantage of South America's fast-growing energy market and surging industrial demand for natural gas in Brazil and Chile. Latin American energy consumption is growing at about 5% a year and the region has largely tapped its available hydropower reserves. Natural gas is seen as an attractive alternative to hydropower because it is abundant and clean burning.

    The rush to serve that market has attracted some big names over the past two years. Last December, Amoco paid $307 million for half of an oil and gas exploration concern broken off from Bolivia's state-owned oil company, Yacimientos Petroliferos Fiscales Bolivianos. And Spain's Repsol has earmarked some $3 billion for regional investments.

    The transaction concludes a hard-fought auction involving a spate of the world's major energy companies. Bidders included Exxon Corp., Mobil Corp., Repsol of Spain and France's Total. Bridas had originally planned to sell a 45% stake to raise money for its Turkmenistan projects.

    Peter Fritsch and Jonathan Friedland, Staff Reporters of The Wall Street Journal

    [08] French economic growth picked up speed in the second quarter

    The French economy gathered pace in the second quarter, expanding by 1%.

    The gain in gross domestic a product followed a 0.2% rise in the first quarter but fell short of expectations of a 1.1% expansion.

    Growth was driven by stockbuilding and trade. But consumption and investment, which are critical for a sustained recovery, showed little change.

    The national statistics agency Insee said second quarter household consumption fell 0.1% after rising 0.2% in the first quarter, while fixed capital formation rose 0.2% in the second quarter after falling 1.2% in the first quarter.

    Together, the two categories had no impact on GDP growth.

    Growth was also helped by the number of working days in the quarter. INSEE said that after adjustment for working days, growth rose around three quarters of a percentage point compared to a rise of half a point in the first quarter.

    The new Socialist-led government has been banking on stronger growth to help it reduce its deficit to qualify for European monetary union.

    However, Insee said the contribution of shifts in inventories to growth in the second quarter added 0.4 percentage point to the result. It said exports of goods and services accelerated strongly in the latest period, rising 5.0% in the second quarter after rising 2.0% in the first quarter. Imports, meanwhile, swung to a rise of 3.4% after falling 0.1% in the first quarter. In total, the trade surplus contributed 0.5 point to the positive GDP report for the second quarter.

    Insee also noted that all sectors of manufacturing experienced accelerated output during the second quarter, rising 2.8% after a rise of 0.5% in the first quarter, with transport-related output growing a steep 6.3% after 0.6%. The industrial sector as a whole rose 2.5% in the second quarter after falling 0.2% in the first quarter. The added value produced in the sector contributed 0.7 point to GDP for the period, Insee said.

    [09] German tax reform plan is again rejected

    Germany's upper house of parliament rejected the government's tax reform bill for a second time, kicking the plan back to a committee that will try to reach a compromise.

    The Bundesrat, which is dominated by the opposition Social Democrats, formally voted down the tax reform plans that Chancellor Helmut Kohl has hoped to use as a cornerstone in his programme to cut unemployment and stimulate economic growth.

    Kohl says broad reforms will spur business investment and combat Germany's near-record joblessness of 11.4%. Opposition leaders say Kohl's plan favours the wealthy and would increase the budget deficit, which for 1997 is expected to be 71.2 billion marks ($39.1 billion).

    While the lower house approved the reforms in July, the Bundesrat said the proposed tax cuts were 'not affordable.'

    This second rejection opens the way for the proposal, drafted by Finance Minister Theo Waigel, to go before a committee of federal and state representatives who will try to draft a compromise to be resubmitted to the lower house, or Bundestag.

    The government's proposed 30 billion mark tax cut plan would have lowered the minimum personal income tax to 15% from 26% on income of more than 13, 000 marks.

    The highest personal tax rate - for incomes of 90,000 marks or higher - would have dropped to 39% from 53%.

    Social Democrats criticise the plan as favouring the well-off and failing to make clear how the shortfall in revenues will be made up. They also say reforms should cut social security contributions.

    [10] Ekran plans to seek new contractor for the Bakun dam project

    Malaysia's Ekran said it intended to pursue the Bakun dam project and would seek a new contractor.

    Ekran officials, who declined to be named, also told Dow Jones Newswires they were acting within contract terms in dismissing a consortium led by Swiss-Swedish engineering giant ABB Asea Brown Boveri as the dam's main contractor and indicated there would be no compensation payment.

    The officials spoke a day after Bakun Hydro-Electric Corp., or BHC, an Ekran affiliate charged with spearheading the 15-billion ringgit project, announced the dismissal of ABB after the two parties failed to settle a dispute over the terms of its contract.

    Since then, Prime Minister Mahathir Mohamad has said that mega-projects such as Bakun would be deferred. But the prime minister also said that the dam could not be scrapped since costly construction had already begun.

    'The project is clearly going on,' said an executive who identified himself as an adviser to Ekran Executive Chairman Tan Sri Ting Pek Khiing. 'That must mean that a contractor will have to be found.'

    ABB, has disputed that it had lost the contract and charged that BHC's announcement was made without informing BHC's other shareholders. Ekran has a 32% stake in BHC, state agencies own 43% and the remaining 25% is to be offered to other investors.

    But Tan Sri Ting's adviser shrugged off the accusation. 'ABB in our mind is indulging in speculation,' he said, adding: 'Ekran cannot and will never act on an important issue like this without the appropriate blessings.' He declined to specify where these blessings might have come from.

    The adviser also said that BHC had 'acted within the four corners of the contract' signed last October, which he said specified that the two parties must agree on certain terms by the beginning of this year. Since extended negotiations had failed, 'the contract cannot come into being,' he said. Another Ekran executive added that compensation was a 'non-issue since there is no contract.'

    The giant dam in Malaysia's Sarawak state has attracted controversy from the start and Dr. Mahathir's statement that the project would be delayed helped to partly revive Malaysia's flagging stock market. Environmentalists say the project - which involves the clearing of 80,000 hectares of rain forest - will destroy rare plants and animals.

    They also question the viability of a submarine cable - the world's longest - to be used to funnel power generated in Sarawak state to peninsular Malaysia.

    Investors have also been wary. During an Ekran rights offering of shares in June meant to raise funds to help finance the dam, Tan Sri Ting and parties related to him were forced to spend more than one billion ringgit taking up new Ekran shares that other shareholders spurned.

    And BHC's listing, which was slated for August, has been postponed indefinitely, partly due to problems with ABB and partly due to the stock market plunge.

    [11] Schroders reports first half profit up 13% to record $200 million

    Schroders reported a record pre-tax profit of £131 million ($207.8 million) in the first half ended June 30, up 13% from last year's £115.9 million.

    Schroders said while the second half had started reasonably well, the outlook for the group's business was 'not easy to predict' due to unsettled equities markets and uncertainties in Asia.

    The group said all its businesses benefited from a 'favourable' environment during the first half. It said earnings at its investment and merchant banking operations climbed 16% to £58.8 million in the first half, from £50.7 million a year ago.

    The investment bank's European corporate finance division enjoyed a successful six months on the back of 'excellent' results in the UK. Its European securities business continued to improve, with revenues generated by the new UK securities business ahead of expectations.

    These improvements were partly offset by a weaker performance at the company's North American corporate finance and capital markets operations.

    [12] Olympic bidders make final presentations in Lausanne

    South African President Nelson Mandela was the star attraction at the IOC as the five cities bidding for the 2004 Olympics made their final presentations.

    The South African leader, pressing his country's bid to hold the Games in Cape Town, asked the IOC to 'enable Africa to host the first Olympic Games of the new century and new millennium, to further the African march to the future and give Africa the impetus it needs and deserves.'

    The other candidates were Athens, Buenos Aires, Rome, and Stockholm.

    With many IOC members still undecided and little separating the five candidates, the final presentations were expected to determine the outcome of the most open Olympic votes in years.

    Rome and Athens went in as slight favourites. But no could discount the impact that Mandela might have.

    The South African leader asked the IOC to 'enable Africa to host the first Olympic Games of the new century and new millennium, to further the African march to the future and give Africa the impetus it needs and deserves.'

    Envisioning the scene in 2004, Mandela said, 'I see the youth of the world gathered at the foot of Table Mountain to fulfil themselves, to give joy to millions and celebrate peace and the rebirth of a continent.

    'Even the old ones such as I would have every reason to feel young again, to say the sacrifices we have all made to end apartheid have given us the possibility to do things that will make for a better world.'

    Athens (1896), Rome (1960) and Stockholm (1912) have all staged the games before. And there appeared to be strong sentiment for taking the games back to Europe in 2004 after 10 years and four Olympics away from the continent.

    But there also was a desire to break new ground by awarding the games to continents where the games have never been held. While Mandela pushed Cape Town's case, Argentine President Carlos Menem was doing the same for Buenos Aires.

    As IOC members arrived at the Beaulieu Palace in Geneva, they were greeted by hundreds of chanting, flag-waving supporters of the rival bids.

    Stockholm, the first city to make a presentation, chose the occasion to announce that Swedish police had arrested a 28-year-old man in connection with two recent bomb attacks against the bid.

    The timing of the announcement was particularly significant, just hours before the vote. 'We will never bow before the threats, small as they are,' Stockholm bid chief Olof Stenhammar told the IOC session.

    Stenhammer also addressed Stockholm's other big weakness - the lack of unanimous public support for the bid. Citing a survey showing 76% of Swedes back a 'financially secure' games, he said, 'This debate is over. We want the games.'

    Each of the five cities had 55 minutes to espouse its cause with speeches, charts and videos. After the presentations, 107 members of the IOC were set to begin casting secret ballots.

    A majority of 54 votes was required for victory. The vote was expected to go four rounds before a winner emerges. The city with the fewest votes is eliminated after each round.

    The key to the race will be which city picks up the most second- and third- choice votes.


    From the European Business News (EBN) Server at http://www.ebn.co.uk/


    European Business News (EBN) Directory - Previous Article - Next Article
    Back to Top
    Copyright © 1995-2023 HR-Net (Hellenic Resources Network). An HRI Project.
    All Rights Reserved.

    HTML by the HR-Net Group / Hellenic Resources Institute, Inc.
    ebn2html v1.01a run on Friday, 5 September 1997 - 17:19:13 UTC