Finance Week articles from October 2005

Finance Week archives from October 2005

Allied Domecq to close UK finance function.(takeover by Pernod Ricard)(Brief Article)
October 26, 2005... Allied Domecq's UK-based finance department will be removed by February next year following the takeover by French drinks giant Pernod Ricard. According to a company insider, the Bristol headquarters of Allied Domecq is currently in a...

Delphi finance chief awarded millions despite Chapter 11.
October 26, 2005... The new chief financial officer of bankrupt US motor parts manufacturer Delphi has been granted a remuneration package worth nearly $4m (#2.25m), including a $350,000 (#198,000) 'golden hello', just days before a new law was introduced to...

DMGT fails to meet Combined Code rules on NEDs.
October 26, 2005... Daily Mail & General Trust (DMGT) is continuing to flout Combined Code on Corporate Governance rules relating to the independence of non- executive directors (NEDs), half of which have collectively served on the board for more than 69...

BNG set to slash finance team after sale.(British Nuclear Group)(Brief Article)
October 26, 2005... State-owned British Nuclear Group (BNG) may be forced to cut around a third of its finance team when the company is sold off, as part of an expected cull of thousands of staff. The board of British Nuclear Fuels Limited (BNFL), which...

Investec's global finance chief takes on wider remit.
October 26, 2005... Investec's global head of group finance has broadened her role to include operations as part of an ongoing strategy to increase efficiencies across the finance function. Rayanne Jacobson says her new remit will involve eradicating any...

KPMG loses out to E&Y in Resolution adviser rejig.
October 26, 2005... Resolution plc is overhauling its list of advisers, including dropping KPMG, auditor to Britannic Group, which the closed life fund consolidator took over for #1.8bn last month. Resolution is retaining its original auditor, Ernst &...

Wolseley plans further fundraising following US private placement.
October 26, 2005... Wolseley is forging ahead with a plan to raise $700m (#396m) through a syndicated loan despite just securing $1.2bn (#679m) through a private placement. Wolseley's group treasurer, Mike Verrier, tells Finance Week: "We still have the...

Carphone Warehouse to build up finance team.(Brief Article)
October 26, 2005... Carphone Warehouse is set to strengthen its finance arm with the recruitment of a group financial accountant as the company continues its rapid expansion. Nigel Langstaff, group director, finance, at Carphone Warehouse, tells Finance...

Colt Telecom moves staff to India to stem losses.
October 26, 2005... Colt Telecom Group has transferred more than 70 back office employees to its offshore base in India as part of a cost-cutting drive to curb its losses. The alternative network operator has transferred 71 positions to the country in...

Pizza Express to float without a chief exec.
October 26, 2005... Gondola Holdings, parent company of Pizza Express, is planning to float the company without appointing a chief executive prior to its listing. Analysts are warning that the refusal to appoint a chief executive at Gondola could deter...

IIR acquisition prompts Informa to overhaul its finance department.
October 26, 2005... Informa has overhauled its finance function and undertaken a group-wide review of its control systems as part of the integration of IIR, the events business it acquired for #768m in June. Along with the IIR deal, the UK publishing and...

Morrisons used just three staff to acquire Safeway.
October 26, 2005... Troubled supermarket chain Wm Morrison undertook the acquisition and initial integration of its mammoth #3bn takeover of Safeways with just three senior finance staff. The slower-than-expected integration of the two chains has been...

Emap eyes central option for SRH.
October 26, 2005... Emap is in the process of reviewing Scottish Radio Holdings' (SRH) finance department to determine whether the team will be rolled into its existing shared service centre (SSC) or stay as a standalone operation. The publishing and...

BHP Billiton wins backing for revised LTIP.
October 26, 2005... The trend for rewarding senior executives through long-term incentive plans (LTIPs) is gathering pace after shareholders last week backed BHP Billiton's revised remuneration package. At the Anglo-Australian mining group's annual general...

Go-Ahead seeks approval for long-term incentive scheme.
October 26, 2005... Shareholders in Go-Ahead Group will vote this week on proposals to establish a long-term incentive scheme for senior executives. The company has called an emergency general meeting (EGM) on Thursday (October 27) and will seek shareholder...

Technical update: Enterprise management incentive.
October 26, 2005... Review highlights need for EMI streamlining The enterprise management incentive (EMI) has been with us for five years and, for option holders, is the most generous share scheme, in tax terms, that has ever been available. Up to...

Mouchel Parkman secures funds for expansion.(with Royal Bank of Scotland )(Brief Article)
October 26, 2005... Support services group Mouchel Parkman has agreed in principle a #75m credit facility with Royal Bank of Scotland to fund acquisitions and organic growth. Kevin Young, finance director at Mouchel Parkman, tells Finance Week: "We've...

Chelsea to publish OFR alongside annual report.(operating and financial review )(Brief Article)
October 26, 2005... Chelsea Building Society is in the throes of preparing an operating and financial review (OFR) to present with its annual report and accounts, despite only listed companies being required to do so. Chelsea's move arrives at the same...

Cookson prepares way for US de-registration.
October 26, 2005... Cookson Group has become the latest company to attempt to exit the US market after confirming that it will seek shareholder approval to terminate its registration with the Securities and Exchange Commission (SEC). The company has...

Halma creates group treasury function.
October 26, 2005... Halma Group has introduced its first group-level treasury function in an attempt to cut finance costs. The company has recruited June Waldron to develop its treasury department. She says the new function wll be "centralised with a lower...

NEWS DIGEST: Scottish Power adds to executive team.
October 26, 2005... Scottish Power has appointed its director of group finance, Keith Cochrane, to its 11-strong executive team, which is responsible for the day-to-day running of the company. Cochrane joined Scottish Power in June 2003 as director, group...

NEWS DIGEST: Sage seeks UK and Ireland finance chief.(John Brearley resigns from Sage Group )(Brief Article)
October 26, 2005... Sage Group is on the hunt for a new UK and Ireland divisional finance director after John Brearley resigned from the group. Brearley, the current finance director for the UK and Ireland, had been in the role for three years heading up a...

NEWS DIGEST: Regus appoints Lastminute.com's Gleadle.
October 26, 2005... Former Lastminute.com chief financial officer Stephen Gleadle is to replace Rudy Lobo at Regus as chief financial officer following the acquisition of Lastminute by Sabre Holdings earlier this year. Gleadle will take up the role at the end of...

NEWS DIGEST: Sydney-Smith gets Magnesium finance role.
October 26, 2005... Vedanta's former finance chief, Peter Sydney-Smith, has been appointed finance director at Australian Aim-listed mining group Magnesium International. Sydney-Smith (pictured) left Vedanta in August after just two years with the company. ...

NEWS DIGEST: Ebay finance chief to become Skype president.(Rajiv Dutta)(Brief Article)
October 26, 2005... Ebay's chief financial officer, Rajiv Dutta, is set to take up the newly created position of president of Skype, the telephone service business it recently acquired for $2.6bn (#1.5bn). Dutta, currently based in the US, will move to London...

NEWS DIGEST: Carillion appoints non-executive.
October 26, 2005... Carillion has appointed David Maloney as a non-executive director, with effect from November 1. Maloney has held a number of finance roles in his career, including chief financial officer at Le Meridien Hotels and Resorts, chief financial...

NEWS DIGEST: Third-quarter profit warnings hit 100 mark.(Brief Article)
October 26, 2005... The number of profit warnings issued by UK companies crashed through the 100 mark during the third quarter of this year, according to research by Ernst & Young. In the three months to September 30, UK quoted companies issued 103 profit...

NEWS DIGEST: iSoft appoints non-executive chairman.
October 26, 2005... iSoft Group has appointed former chief executive of BAE Systems and chairman of Spirent John Weston as non-executive chairman. He replaces Patrick Cryne, co-founder of the healthcare software company, who will step down from the board. ...

Companies query covenants under IFRS.
October 26, 2005... International Financial Reporting Standards (IFRS) have triggered a number of companies to ask their banks to review the covenants on their banking facilities. Speaking at an Association of Corporate Treasurers' (ACT) conference on IAS...

Debt market liquidity set to dry up within six months.
October 26, 2005... Finance directors and treasurers have less than six months to take advantage of lows in borrowing rates before liquidity dries up and banks begin to grapple with Basel II. Pricing on syndicated debt for European companies rated AA, A and...

Marketing services groups struggle to collect debts.
October 26, 2005... Marketing services companies have reported a steep jump in the average time taken to collect debts, almost doubling over the past year and sparking concerns of a decline in cash management standards. The average time taken to collect...

NEWS ANALYSIS: News Corp investors choke on murdoch's poison pill.
October 26, 2005... Rupert Murdoch faces a backlash from News Corp and BSkyB shareholders over the poison pill provision he implemented without their approval. With the practice now outlawed in the UK, Matthew Martin examines its merits as a defence against...

NEWS ANALYSIS: The end of poison pills in the UK.(Brief Article)
October 26, 2005... The battle to acquire P&O in 2002 resulted in one of the last instances of the use of a poison pill in the UK, and was followed by the Takeover Panel closing one of the last loopholes in the code that could be exploited for the...

INTERVIEW - MARK SMITH: Sound planner.
October 26, 2005... Three years after breaching its banking covenants, when analysts sounded the death knell for Chime, the company is back on track. Noelle Waugh talks to finance director Mark Smith about restructuring the business and his plans for further...

COMMENT: Refco struggles with history lesson.
October 26, 2005... Corporate scandals should be held up as examples to others of how not to do it. Yet some companies fail to appreciate the effort - the staff - that are needed to get things right Karl Marx once said, history repeats itself, first as...

Banks are in for a roasting when Sepa is introduced.
October 26, 2005... As we near the Yuletide period, it is always heartening to hear a tale of turkeys voting for Christmas. In this case, the turkeys are banks and their suicidal tendencies are directed towards the introduction of the Single Euro Payments...

COMMENT: Euronext's plan B could start market competition.
October 26, 2005... The future of the London Stock Exchange depends on the verdict of the Competition Commission. But in reality, is it missing the nature of the relationship between exchanges? Any day now, the Competition Commission will give its verdict...

CLOSE-UP - ANDREW SING: Ensuring Toyota can remain the car in front.
October 26, 2005... Toyota is a tough market player but EU legislative changes mean a major source of income is under threat for the Japanese car manufacturer, leaving UK finance director Andrew Singer with his work cut out. Hugh Tomlinson finds out how he...

ACCOUNTING RULES: UK plc steps up resistance to creeping IFRS rules.
October 26, 2005... As the International Accounting Standards Board closes its consultation on the proposals for accounting in mergers and acquisitions, Michelle Perry looks at whether the standard setter is veering towards a US- style approach and how finance...

TECHNICAL ANALYSIS: How finance is taking on mantel of risk management.
October 26, 2005... Regulation is driving finance directors to explain to investors how they manage their risk, leading to increased involvement of the finance function in risk management. A more rounded and effective approach is the result, says Ken MacDonald...

COMPANY PROFILE: Acquisition strategy brings Capital gains.
October 26, 2005... Capital & Regional's innovative use of funds in its acquisition drive has enabled the property group to grow rapidly in the past four years, earning triple-A ratings. Matt Goodburn looks at how the company's portfolio expansion is set to...

THE BOTTOM LINE: More money than sense.
October 26, 2005... Hiring a new chief financial officer on a basic salary of $750,000 might not seem an obvious move for a bankrupt company but it is the latest step in the ugly situation at Delphi. Managers of the vehicle parts manufacturer are sitting...

THE BOTTOM LINE: Nuclear confusion.
October 26, 2005... The UK's relationship with nuclear power seems to be getting more complicated by the week. The break-up of the British Nuclear Fuels business became a possibility earlier this year when the newly formed Nuclear Decommissioning Agency...

THE BOTTOM LINE: Code-breakers.
October 26, 2005... The Daily Mail and General Trust Group (DMGT) annual report and accounts make entertaining reading. Not only does its board flout practically every rule in the Combined Code on Corporate Governance handbook but it's unabashed in doing...

THE BOTTOM LINE: A new beginning.
October 26, 2005... Just three weeks in his new role, Wm Morrison's finance director, Richard Pennycook, is looking to beef up his senior finance team from three to seven. However, it looks like a case of shutting the stable door after the horse has...

PENSIONS GUIDE: Comment.
October 26, 2005... Not many finance directors feel like Formula 1 principals but when it comes to tinkering with the engine, pensions, as investment vehicles, go through more changes than Frank Williams would probably care to think about. The lay...

PENSIONS GUIDE: Trustees should take the lead on pension issues.
October 26, 2005... A series of corporate failings starting with the Mirror Group pension fund debacle of the early 1990s have ushered in increasingly tough regulation but with little focus on pension fund trustees. Geoff Lindey explains the role they can...

PENSIONS GUIDE: Why trustee boards risk losing financial expertise.
October 26, 2005... Finance directors who are also trustees of their companies' pension funds could become a thing of the past as more and more step down in the face of increasing regulatory pressure. Rachel Gordon examines whether holding such as dual role...

PENSIONS GUIDE: The new driving force behind pension planning.
October 26, 2005... Liability-driven investment is growing in popularity as a strategy for pension funds. Andrew Michael looks at what is involved in implementing the schemes and why finance directors should consider making the most of the benefits that can...

PENSIONS GUIDE: Pensions act will speed demise of final salary.
October 26, 2005... One unintended consequence of the Pensions Act 2004 will be a rapid increase in the number of companies closing their final salary pension schemes. But in doing so, finance directors will have to ensure that their company does not fall foul...

PENSIONS GUIDE: Avoiding the pitfalls of the new pensions regime.
October 26, 2005... With A-day less than six months away, finance directors need to assess the implications that the pensions simplification regime will have for their business and decide upon the best options for their staff. James Phillipps explains the...

National Express swaps buy-back for acquisition.
October 19, 2005... National Express has been given the go-ahead to officially halt its #100m share buy-back programme in the new year in preference for funding further bolt-on acquisitions. The transport group's #100m buy-back scheme has been suspended,...

Scottish & Newcastle faces rebuke over chairman's role.
October 19, 2005... Scottish & Newcastle is facing shareholder pressure over its chairman's commitment to the company due to Sir Brian Stewart's dual role chairing the soon-to-float mutual Standard Life. Standard Life's flotation, planned for the middle...

Body Shop to shed finance staff after IT investment.(Brief Article)
October 19, 2005... Body Shop International is planning to cut jobs across its finance department following the implementation of a new IT system costing #15m. The company has between 100 and 120 staff in its finance department, including a number of...

MFI takes on Carpetright as tenant to cut costs.
October 19, 2005... MFI has snagged Carpetright as a tenant to take on some of its excess retail space ahead of the troubled retailer's announcement of a new business plan. According to a number of well-placed sources, Carpetright is sub- letting space in...

Lloyd's makes finance head acting chief executive.
October 19, 2005... Lloyd's of London director of finance and risk management Luke Savage will be thrust into the role of acting chief executive after just 17 months in the market following the surprise resignation of Nick Prettejohn. Prettejohn will join...

St Ives reviews pension funding as mortality rates double deficit.
October 19, 2005... St Ives, the printing group that publishes company annual reports, is being forced to review its pension fund contributions after new mortality calculations caused the deficit to nearly double. Despite making a special payment of #25m to...

INSIGHT: WH Smith pension change could be another flash in the pan.
October 19, 2005... WH Smith's move to switch 94 per cent of its pension fund assets away from equities and bonds into derivatives is bound to be picked over by both pension trustees and boards at other companies. Last week's surprise move by the retailer...

Wedgwood to cut back finance team after merger.(Brief Article)
October 19, 2005... Wedgwood, a major division of the Waterford Wedgwood group, is planning to cull staff from its finance division as it moves ahead with the integration of Royal Doulton. Andrew Elsby-Smith, finance director of Wedgwood Ltd, says the...

Homebase moves finance function.
October 19, 2005... Homebase has relocated its finance director, Neil Fuller, and the group's commercial finance arm to Milton Keynes as part of parent company GUS group's cost-cutting measures. The DIY retailer, part of GUS's Argos Retail Group, has been...

Hilton reunification could pave way for Wallace to join RBS.
October 19, 2005... Hilton Group's finance director and deputy chief executive is being mooted to take over the top finance role at Royal Bank of Scotland (RBS) if the #3.6bn talks to reunify the hotel brand with its US counterpart succeed. Talks between...

Axa reshuffle launches actuarial team in India.
October 19, 2005... Axa UK will create a new actuarial team at its offshore site in Pune, India, over the next few months as part of its finance transformation project, which aims to offshore one third of the insurer's finance team by the end of the year. ...

Granville's finance chief investigated.(Kieran Browley )(Brief Article)
October 19, 2005... Granville Technology Group's finance director is facing an investigation by administrator Grant Thornton as it considers taking legal action against the former company directors. Kieran Browley served as finance director in the lead-up to...

AIB takes on temporary staff to aid with Sarbox.(Allied Irish Bank)(Brief Article)
October 19, 2005... Allied Irish Bank (AIB) is taking advantage of the extension for compliance with Sarbanes-Oxley by recruiting temporary staff to help with preparation. AIB (GB), part of the AIB group, is recruiting temporary Sarbanes-Oxley employees....

BAA stands by ABN but drops JP Morgan.
October 19, 2005... BAA last week bolstered one of the City's most beleaguered brokers, ABN Amro Hoare Govett, when it retained the house as adviser, but delivered a further blow to JP Morgan Cazenove. The airport operator found itself at the centre of a...

Friends Prov censured over option hedging.
October 19, 2005... Friends Provident's option hedging programme has come under attack following the publication of its 2004 full-year results under European Embedded Value (EEV) methodology, despite year-on-year option costs declining by 29 per cent. As...

Petrofac finance chief nets #5m through loan.(Keith Roberts )(Brief Article)
October 19, 2005... Petrofac's chief financial officer has made #5m from the company's listing on the London Stock Exchange earlier this month after borrowing almost $1.5m (#850,000) from the company to participate in its share scheme. Keith Roberts used...

Moss Bros moves in-house to slash costs.
October 19, 2005... Moss Bros has cut #500,000 a year from its cost base after bringing its investor relations function back in-house. The group, which trades from the Moss, Cecil Gee and Hugo Boss fascias, previously outsourced its financial investor...

NEWS DIGEST: Harvey Nash appoints new finance chief.
October 19, 2005... Harvey Nash has named its replacement for group finance director Albert Ellis, who was promoted to chief executive at the recruitment consultants earlier this year. Richard Ashcroft joins the company from High Performance Coaching on...

NEWS DIGEST: Per Una's White quits Marks & Spencer.
October 19, 2005... Per Una's finance director, Andrea White, has resigned from the Marks & Spencer (M&S) women's wear line, alongside consultant George Davies and head of merchandising Melanie Davies. It is understood that George Davies has a 12-month notice...

NEWS DIGEST: Cash windfall for Cairn finance chief.(Kevin Hart)(Brief Article)
October 19, 2005... Cairn Energy's finance director, Kevin Hart, received a #1.75m windfall after selling off nearly half his personal stock in the oil and gas group at 1,750p per share. Hart was one of four directors who, in total, netted #10.5m after...

NEWS DIGEST: Chelsea in line for Moody's ratings upgrade.
October 19, 2005... Chelsea Building Society's long-term and financial strength rating could be upgraded from A3 to A2 by credit rating agency Moody's if it demonstrates sufficient profit growth in its 2005 full-year results. Moody's announced the review last...

NEWS DIGEST: Drax finance chief to pick up #3m on flotation.
October 19, 2005... Drax's finance director, Gordon Boyd, stands to gain around #3m if the company is floated or sold later this year. Drax's employees own around 5 per cent of the company and Boyd is one of five executive directors expected to share in a...

NEWS DIGEST: Finance director takes chief exec role at TNS.(Taylor Nelson Sofres)(David Lowden )(Brief Article)
October 19, 2005... Taylor Nelson Sofres' former finance director is set to take on the chief executive role at the market research company. David Lowden will replace incumbent Mike Kirkham from March 1 next year. Lowden joined the company as finance director...

ABI demands better justification for failure to comply with Combined Code.
October 19, 2005... The Association of British Insurers (ABI) is calling for more convincing explanations from companies that disregard boardroom guidelines by promoting their chief executive to the role of chairman. In its response to the Financial...

FRC presses companies to come clean on internal weaknesses.
October 19, 2005... Company boards will now be required to formally notify shareholders when they have fixed, or are in the process of repairing, any significant weaknesses in the company's internal control system. The Financial Reporting Council (FRC)...

ASB to examine pensions reporting.
October 19, 2005... The Accounting Standards Board (ASB) has launched a review into the financial reporting of pensions, spurred on by criticism of the FRS 17 standard from employers, trustees and actuaries. The ASB is forming a pensions advisory panel that...

NEWS ANALYSIS: Sub-letting could ease retailer's cash crisis.
October 19, 2005... After reporting a 31 per cent drop in sales in just one month, MFI is in need of some drastic cost-cutting measures. While redundancies may provide a solution, a better option could be leasing surplus property space to other retailers....

INTERVIEW - RICHARD ADAM: Port authority.
October 19, 2005... A pension surplus and a strategy that guarantees a 15 per cent return on investments are just two of the achievements finance director Richard Adam has realised in his short tenure at Associated British Ports. Hugh Tomlinson talks to him...

COMMENT: Government must pick up PPF slack.
October 19, 2005... The PPF's risk-based levy runs the risk of damaging UK business and the Government has to wake up to the fact that it has a role to play in reducing the burden on companies Last week, the Pension Protection Fund (PPF) signalled a climb...

Borrowers should tread carefully on margin upturn.
October 19, 2005... Just how long can this borrower's market continue? The messages in the market are pretty mixed to say the least. On the one hand, the Cassandras are predicting that the low rates at which companies have been borrowing are set to rise in...

RICHARD NORTHEDGE: Code must find a balance over legislation on NEDs.
October 19, 2005... The Combined Code on Corporate Governance has increased the demand for non-executives but strict regulation has strangled the supply of those willing to take on the roles One of the perks of being a finance director ought to be the...

PETER HOOLEY: How a collapsed deal helped fuel a financial revival.
October 19, 2005... After six years of streamlining the once unwieldy conglomerate, Peter Hooley, finance director of Smith & Nephew, is eyeing smaller bolt-on acquisitions and expanding the group into new markets. Noelle Waugh speaks to him about his 'two...

TAX: Tread carefully through the taxation minefield.
October 19, 2005... The Government's focus on tax avoidance, combined with the creation of Her Majesty's Revenue & Customs and a number of high-profile tax cases at the European Court of Justice, are having a significant impact on the UK tax system. Ross...