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CORRECTED - MAJOR SWISS BANKS RAISE CUSTOMER TIME DEPOSIT RATES 1/4 POINT TO 3-1/4 PCT - CREDIT SUISSE
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FISONS SEES STRONG INTERNATIONAL GROWTH IN 1986 | Fisons Plc <FISN.L> said strong
international growth had been the main feature of the group's
1986 progress, with the pharmaceutical division reporting a 50
pct increase in U.S. Sales during the period.
The rise was due to a sustained marketing programme, a
larger sales force and the introduction of an aerosol form of
its Intal anti-asthma drug, which pushed U.S. Sales up 70 pct.
The company was commenting on 1986 results which saw
pre-tax profits rising to 85.1 mln stg from 72.3 mln in 1985.
The result was in line with market forecasts, but its shares
nevertheless eased in a falling market to 634p at 0857 GMT from
643p.
Fisons said the potential for future growth of Intral, as
well as its Opticrom and Nasalcrom products, was clearly
indicated by a strong 1986 performance.
The scientific equipment business had raised the proportion
of high technology products it manufactures and also raised its
ability to generate higher margins. The horticulture operations
had demonstrated outstanding marketing ability. Underlying cash
flow from all three operations had been positive despite a full
programme of capital investment.
Action to protect the group against foreign currency
movements resulted in a small net gain to profits.
REUTER
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PHILIPPINE PLANNING CHIEF URGES PESO DEVALUATION | The Philippines must devalue the peso if
it wants its exports to remain competitive, Economic Planning
Secretary Solita Monsod told Reuters.
"The peso/dollar rate has to be undercut to make our exports
more competitive," Monsod said an interview. "No question about
it. I'm saying you cannot argue with success. Taiwan, South
Korea, West Germany, Japan, all those miracle economies
deliberately undervalued their currencies."
The peso has been free-floating since June 1984. It is
currently at about 20.50 to the U.S. Dollar.
Finance Secretary Jaime Ongpin has said the government does
not intend to devalue the peso and wants it to be flexible and
able to continue to respond to market conditions.
Monsod said Ongpin was looking at the exchange rate from
the point of view of finance. "If the dollar rate goes higher,
our debt service in terms of pesos gets higher, so the
financing is very difficult," she said. "But I am looking at it
in terms of the economy."
She said she was not trying to oppose official policy.
"I'm just saying, keep it competitive. I do not want it to
become uncompetitive because then we are dead."
Monsod said, "The ideal movement in the peso/dollar rate is
a movement that will reflect differences in inflation (rates)
of the Philippines versus the other country. It's an arithmetic
thing."
Official figures show Philippine inflation averaged 0.8 pct
in calendar 1986. Ongpin told reporters on Saturday it was
expected to touch five pct this year.
He said the government and the International Monetary Fund
had set the peso/dollar 1987 target rate at 20.80.
The peso lost 22.2 pct in value to slump to 18.002 to the
dollar when it was floated in 1984.
REUTER
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U.K. CLEARS CONS GOLD U.S. PURCHASE | The U.K. Trade Department said it would
not refer Consolidated Goldfields Plc's <CGLD.L> purchase of
<American Aggregates Corp> to the Monopolies Commission.
Cons Gold said last month that its <ARC America Corp> unit
had agreed to buy the Ohio-based company for 30.625 dlrs a
share cash, or 242 mln dlrs, in a deal recommended by the
Aggregates board.
REUTER
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NEDERLANDSE GASUNIE ISSUES 100 MLN DLR EUROBOND | NV Nederlandse Gasunie is issuing a 100
mln dlr eurobond due April 15, 1992 paying 7-1/4 pct and priced
at 101-1/8 pct, lead manager Citicorp Investment Bank Ltd said.
The non-callable bond is available in denominations of
5,000 dlrs and will be listed in Luxembourg. The selling
concession is 1-1/4 pct, while management and underwriting
combined pays 5/8 pct.
The payment date is April 15.
REUTER
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SAAB-SCANIA ISSUES 150 MLN DLR EUROBOND | Saab-Scania AB is issuing a 150 mln dlr
eurobond due April 2, 1992 paying 7-3/4 pct and priced at
101-3/4 pct, lead manager Morgan Guaranty Ltd said.
The bond is available in denominations of 5,000 and 50,000
dlrs and will be listed in London. Payment date is April 2,
1992.
Fees comprise 1-1/4 pct selling concession and 5/8 pct
management and underwriting combined, and listing will be in
London.
REUTER
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MERRILL MANDATED FOR IEL U.S. NOTE. | Merrill Lynch Capital Markets said it
received a mandate from Industrial Equity Ltd (IEL) of
Australia to arrange a letter of credit facility in support of
100 mln dlrs of medium term notes and U.S. Commercial paper to
be sold in the U.S. Domestic market.
Merrill, which will be the dealer for the medium term notes
and commercial paper, said this was the first facility of its
kind. Sumitomo Trust and Banking Co Ltd has agreed to provide
the letter of credit.
The letter of credit has a five year term, with an
evergreen feature allowing for extension at the support banks'
option.
The notes and paper will be issued by IEL's Sydney-based
subsidiary, IEL Finance Ltd.
The letter of credit will be underwritten by a group of
banks who will be paid a 20 basis point facility fee and a 25
basis point utilisation fee.
IEL itself is 51 pct owned by Brierley Investments Ltd of
New Zealand, Merrill Lynch said.
REUTER
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ZAIRE ACCEPTS TIN-EXPORT QUOTA, ATPC SAYS | Zaire agreed to limit its tin
exports to 1,736 tonnes for 12 months from March 1 in line with
an Association of Tin Producing Countries (ATPC) plan to curb
exports, the ATPC said.
ATPC Executive Director Victor Siaahan told Reuters he
received a telex from Zaire indicating its willingess to take
part in the plan to limit total ATPC exports to 96,000 tonnes
for a year from March 1.
Siaahan said Zaire is expected to produce 1,900 tonnes of
tin in calendar 1987, and that in 1986 its output and exports
were about 1,200 tonnes.
The ATPC hopes to cut the 70,000-tonne world surplus by
20,000 tonnes and boost prices.
All ATPC members except Zaire and Australia recently agreed
to adhere to the export quotas allocated them under the plan.
Australia said its quota of 7,000 tonnes was roughly equal to
its expected output this year.
The ATPC consists of Malaysia, Indonesia, Thailand,
Bolivia, Australia, Nigeria and Zaire.
China and Bolivia, important producers of tin, are not
members.
REUTER
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JAPANESE BANKS PLAN JOINT FIRM TO AVOID DEBT RISK | Japan's major commercial banks plan to set
up a joint company to which they will transfer assets acquired
by lending to developing countries to build up a reserve
against possible bad loans, a senior official of a major bank
told Reuters.
He said about 10 banks are likely to finish details of the
project in a few weeks. The intent is to avoid risk arising
from unrecoverable debt owed by Third World countries, he said.
REUTER
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JAPANESE FINANCIAL FUTURES PLAN REVEALED | The Federation of Bankers' Associations of
Japan released its proposal for early creation of a
comprehensive financial futures market in Tokyo.
The market should include a comprehensive range of futures
and options trading so Tokyo can develop into a real global
money centre where a variety of risk-hedging instruments is
available, the proposal said.
It should provide currency and interest rate futures, and
incorporate the existing yen bond futures and planned stock
index futures contracts.
The proposal said transactions in all these contracts must
be conducted on the same market so participants can readily
engage in arbitrage between various financial instruments.
To make this possible, the proposal calls for new
legislation which would administer all related futures and
options transactions under the same legal framework.
Banking sources said they expect that initially the
currency futures would be dollar-yen and interest futures would
include Japanese domestic yen certificates of deposit,
three-month Eurodollar deposits and 20-year U.S. Treasury
bonds.
Banking sources quoted federation chairman Yoshiro Araki as
saying he hoped the market would be created as soon as possible
because it would help promote the liberalisation of Japan's
financial markets.
Araki said he had no intention of limiting prospective
market participants to banks but was willing to accept those
from wider business circles, the sources said.
Japan's only current financial futures market, in yen
bonds, began on the Tokyo Stock Exchange in October 1985.
But the Osaka Stock Exchange plans to start futures trading
in a basket of leading stocks in April.
REUTER
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EC, EURATOM FRENCH FRANC EUROBONDS EXPECTED | The European Community (EC) and Euratom,
the European atomic energy agency, are expected to issue French
franc eurobonds this month, a Treasury spokesman said.
Other eurofranc bonds this month are likely to include
issues by a bank and a company, both unidentified, but no other
details were available. The spokesman said the March calendar
would be flexible, to take account of market conditions.
REUTER
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AUSTRALIAN POLICE ARREST FORMER WESTPAC CLERK | Australian police said they charged a
former currency clerk of Westpac Banking Corp <WSTP.S> with
misappropriating 8,300 dlrs in July in an alleged
foreign-exchange fraud.
A spokeswoman for the New South Wales Corporate Affairs
Commission (CAC) said the arrest was part of its investigation
stemming from complaints from Westpac and <Kleinwort Benson
Australia Ltd>.
CAC and Westpac officials said they were working out how
much money was involved, but said press reports it was as much
as five mln dlrs were probably exaggerated.
Police told reporters it was alleged the former clerk
quoted an incorrect dealing price relationship between the yen
and the Swiss franc.
They said the CAC was investigating 14 other cases
involving 214,000 dlrs.
A Kleinwort Benson spokesman declined to comment on the
case but the company said in a statement yesterday a small loss
incurred in 1986 in its foreign-exchange division was unrelated
to "certain alleged forex irregularities."
REUTER
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U.K. MONEY MARKET DEFICIT FORECAST AT 350 MLN STG | The Bank of England said it forecast a
shortage of around 350 mln stg in the money market today.
Among the main factors affecting liquidity, bills maturing
in official hands and the take-up of treasury bills will drain
some 525 mln stg while bankers' balnces below target will take
out around 175 mln stg.
Partly offsetting these outflows, exchequer transactions
and a fall in note circulation will add some 300 mln stg and 40
mln stg to the system respectively.
REUTER
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JAPAN LIKELY TO LET U.S. BANKS DEAL SECURITIES | Japan looks likely to allow U.S. Banks to
conduct securities business here, a move that will probably
cause the barriers separating Japanese commercial banks from
brokerage houses to break down, financial analysts said.
But the timing of the approval remains uncertain, due to
conflicting domestic interests.
J.P.Morgan and Co <JPM>, Bankers Trust New York Corp <BT>,
Manufacturers Hanover Corp <MHC> and Chemical Bank New York
Corp <CHL> are expected to win approval to conduct securities
business in Japan, U.S. Bank officials said.
"There is no reason for extended delay of approval," one
official at a U.S. Bank said. The four U.S. Banks have been
seeking finance ministry approval for months.
To date, Japan has allowed European banks to do securities
business here through 50-pct owned subsidiaries. As Japanese
banks can conduct securities business in European countries,
this was seen as a reciprocal move and did not pave the way for
Japanese banks to enter the domestic securities market.
But if U.S. Banks win approval, Japanese banks will press
hard for similiar status, since they are not allowed to conduct
securities business in the U.S.
Many U.S. Bank officials expect their applications to be
approved before June. But Japanese banking sources said the
decision will be delayed until next year. A spokesman for the
finance ministry declined comment.
U.S. Bankers will meet with ministry officials for talks on
financial market deregulation sometime in the next few months.
Ministry sources said the talks are likely to be held in April
or June.
At the last round of financial negotiations in September,
U.S. Officials said Japan's commitment to deregulation was
flagging.
Analysts said the finance ministry has been seriously
considering the U.S. Request since the U.S. Federal Reserve
Bank of New York approved five new primary government
securities dealers, including two Japanese brokerages, last
December.
They said the ministry will have to approve the U.S.
Request soon to head off criticism its markets are not as open
to foreigners as those of the U.S.
Analysts said Japan has proceeded rapidly with financial
deregulation since 1984, but has not touched upon the clear
division between the securities and banking businesses.
Japanese banks and securities houses have fought hard to
protect their interests, but analysts said the banks are
finding it increasingly difficult to earn money in traditional
fields.
Officials of major Japanese banks said they will pay
special attention to the ministry's reaction to U.S. Bank
requests because approval would accelerate market
liberalization in Japan.
The Japanese bankers hope approval will pave the way for
their own entry into the domestic securities market.
REUTER
|
SAUDI RIYAL DEPOSIT RATES EASE | Saudi riyal interbank deposit rates
eased across the board in a dull market which was long in
day-to-day funds, dealers said.
Today's quiet market continued a lull of several days in
which traders were said to be waiting on the sidelines ahead of
further clues to the direction of oil prices and the Saudi
economy.
Dealers cited some borrowing interest in two, three, and
six-month deposits but said activity focused on short dates and
one-month deposits as banks tried to lend surplus funds.
Spot-next was put at 5-3/4, 5-1/4 pct, down from six, 5-1/2
yesterday while one-week rates were steady at six, 5-1/2 pct.
One-month deposits declined to 6-1/4, 1/8 pct from 6-1/2,
1/4 on Monday, while three months was barely changed at seven,
6-15/16 pct.
The spot riyal was little changed at 3.7501/03 to the
dollar after quotes of 3.7498/7501 yesterday.
REUTER
|
CURRENCY SECTORS CONTINUE TO FEATURE EUROBOND TRADE | Early dollar straight eurobond trade was
quiet with currency sectors, particularly eurosterling,
continuing to perform strongly, closely reflecting current
trading patterns on the foreign exchanges, dealers said.
Eurosterling bonds continued to rise steadily, bolstered by
the extremely ebullient tone of the U.K. Government bond market
on a combination of positive U.K. Economic fundamentals.
The dollar was initially stabler but most dollar straight
bonds were static in dull trade. A handful of issues showed
signs of weakness but dealers said investors were awaiting
today's release of U.S. Leading indicators for January.
The U.S. Data due out this afternoon is expected to be
weak, placing the U.S. Unit under renewed pressure and robbing
the market in dollar-denominated eurobonds of fresh trading
impetus, one dollar straight trader said.
"It's going to be another tedious day and I can't see how
anybody is going to make any money," he said.
Eurosterling issues continued to rally on the back of
general sterling euphoria -- with the U.K. Currency trading at
six month highs on interest rate optimism and the strength of
the domestic equity markets.
Eurosterling bonds saw early gains of up to half a point.
However, some eurosterling dealers noted the bonds could
soon fall back marginally if -- as expected -- professionals
stepped in to take profits at current healthy levels.
Trade in mark-denominated bonds was expected to be subdued
today due to pre-Lenten carnival festivities in West Germany.
There were signs of reawakened investor nerves affecting
trade in the floating rate note market which yesterday started
the week extremely quietly after a hectic sell-off last week.
FRN dealers said paper of U.S. -- and also of Canadian --
banks was seeing some pressure as a result of recent press
reports focussing on their exposure to Latin American debt.
"(Brazilian Finance Minister Dilson) Funaro's visit to
Europe has also brought the spotlight back onto the debt crisis
after things had more or less quietened down following the
first shock statements last week," one FRN specialist said.
Despite the dearth of activity in the dollar straight
secondary market, two new dollar issues were the only early
features on the primary market.
These were a five year 150 mln dlr deal launched by Morgan
Guaranty Ltd for Saab Scania at 7-3/4 pct priced at 101-3/4
pct.
The other issue was a 100 mln dlr deal -- also due 1992 --
for NV Nederlandse Gasunie paying 7-1/4 pct and priced at
101-1/8 pct, with Citicorp Investment Bank Ltd as lead manager.
Dealers predicted reasonable demand for both issues due
mainly to a lack of fresh, good name paper in the market.
REUTER
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FRENCH TREASURY DETAILS PLANNED TAP ISSUE | The French Treasury will issue between
eight and 12 billion francs worth of tap stock depending on
market conditions at its monthly tender on Thursday, the Bank
of France said.
The planned issue will be of two fixed-rate tranches, of
the 8.50 pct June 1997 and the 8.50 pct December 2012 stock,
and one tranche of the variable-rate January 1999 stock.
The minimum amount of each tranche to be sold will be one
billion francs.
REUTER
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PEMEX SIGNS 500 MLN DLR JAPAN LOAN FOR PIPELINE | Mexican state oil firm Petroleos Mexicanos
(Pemex) signed for a 500 mln dlruntied loan from the
Export-Import Bank of Japan to finance its Pacific Petroleum
Project, Pemex Japan representative Tito Ayal said.
No further details on the loan were immediately available.
Ayala told an oil seminar the project, due for completion
in 1988, is aimed at improving distribution of oil products in
the domestic market, mainly along the Pacific coast.
The project consists of a pipeline linking Nueva Teapa on
the Gulf of Mexico with Salina Cruz on the Pacific Coast, and
construction of the second phase of the Salina Cruz refinery.
The project also includes construction of liquified
petroleum gas (LPG) storage tanks at Santa Cruz, additional
crude oil storage at both ends of the pipeline, an ammonia
complex at Lazaro Cardenas on the Pacific Coast and expansion
of the infrastructure of the port of Salina Cruz, Ayala said.
Pemex will buy 80 mln dlrs worth of foreign equipment and
materials for the project, he said. The new pipeline will
enable Japan to load Mexico's Maya crude oil at Salina Cruz
rather than in the Gulf of Mexico. Pemex will also have some
LPG surplus available in Salina Cruz that may help Japan
diversify its supply sources of that product, he added.
REUTER
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SUPPLIES OF U.K. INDEX-LINKED BOND EXHAUSTED | The Government broker's supplies of a 400
mln stg issue of two pct Treasury index-linked stock due 1992
were exhausted in early trading on the U.K. Government bond
market this morning, the Bank of England said.
The Bank said that the issue was no longer operating as a
tap, having been supplied at a price of 94 stg pct this
morning.
The issue was undersubscribed at a tender on February 18,
but the Government broker has supplied amounts of the stock on
a number of occasions since then. The relatively small quantity
remaining in the authorities' hands was quickly sold out on a
small upturn in demand early today.
REUTER
|
STC PLC <STCL.L> YEAR TO END-1986 | Shr profit 15.9p vs 2.25p loss
Div 3p making 4.5p vs nil
Turnover 1.93 billion stg vs 1.99 billion
Pretax profit 134.2 mln vs 11.4 mln loss
Tax 47.2 mln vs nil
Operating profit 163.0 mln vs 92.7 mln
Interest less investment income 13.8 mln vs 37.2 mln
Exceptional debit 15.0 mln vs 66.9 mln
Minorities 0.3 mln vs 0.4 mln
Extraordinary credit 16.4 mln vs 42.0 mln debit
Operating profit includes -
International computers 90.2 mln vs 61.7 mln
Communications systems 56.1 mln vs 48.7 mln
Components and distribution 20.0 mln vs 1.5 mln
Defence 9.4 mln vs 13.1 mln
REUTER
|
COMALCO SAYS LOWER COSTS HELPED RETURN TO PROFITS | Comalco Ltd <CMAC.S> said its return
to profit reflected reduced costs, improved primary aluminium
prices and its withdrawal from a Japanese smelter venture.
It said the earlier reported 57.1 mln dlr profit for the
year ended December 31 against a 69.13 mln dlr loss in 1985 was
also aided by lower interest rates on U.S. Dollar debt and
greater sales of bauxite and aluminium.
Comalco said it expected to pay at least a four cents per
share final, dividend delayed until July 1 to take advantage of
proposed dividend imputation laws.
This would make five cents for the year against a first and
final of one cent in 1985.
Comalco said the aluminium industry continued to suffer
from low prices and excess capacity, though the weak Australian
dollar had helped earnings.
Withdrawal from the <Showa Aluminium Industries KK> joint
venture had been recapitalised in expansion by the <New Zealand
Aluminium Smelters Ltd> project with Japan's <Sumitomo
Aluminium Smelting Co Ltd>, permitting repayments and increases
in liquid funds totalling 165 mln dlrs, it said.
As previously reported Comalco's <Commonwealth Aluminium
Corp> unit has conditionally agreed to sell its smelter at
Goldendale, Washington, and port facilities at Portland, Oregon
to <Columbia Aluminium Corp>.
Comalco said it had made a 27.3 mln dlr extraordinary
provision for Goldendale losses and closure costs but that if
the sales agreement were completed it would reduce the
provision made in the 1986 accounts.
The other items in the total extraordinary loss of 140.5
mln dlrs were a 102.9 mln write-off of unrealised exchange
losses and 10.3 mln for an increase in future tax provision.
REUTER
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CRA EXPECTS TO PAY FINAL DIVIDEND OF 10 CENTS | CRA Ltd <CRAA.S> said it expected to
pay a final 1986 dividend of not less than 10 cents a share
after July 1, making 13 cents forthe year against 15 in 1985.
The mining and smelting group earlier reported 1986 net
earnings rose to 138.2 mln dlrs from 87.8 mln in 1985, against
analysts' forecasts yesterday of 125 mln to160 mln.
CRA said it was deferring consideration of a dividend until
later this year to provide the benefit of dividend imputation
to its shareholders. After July 1, dividends will be tax-free
to shareholders provided they come out of earnings on which the
full 49 pct company tax rate has been pid.
The company operates on a substituted tax year, not the
fiscal year ending June 30, and as a result has incurred tax at
the 49 pct rate on 1986 earnings, CRA said in a statement.
Consequently, it has funds available for distribution with
dividend imputed but is waiting to see the imputation
legislation before determining the final payout, it said.
Despite the higher net earnings, CRA said 1986 was a poor
year for the minerals industry, with the notable exception of
gold producers.
Prices for major metals expressed in real U.S. Dollars
declined to the lowest levels in about 50 years, it said.
Fluctuating exchange and interest rates added volatility
and uncertainty, while the revaluation of the yen is leading to
substantial restructuring of Japanese industry, CRA said.
World demand for metals is growing slowly. Inventories have
steadily declined, with supply and demand in better balance,
but overcapacity continues, CRA said.
Turning to contributions to its earnings, CRA said
Bougainville Copper Ltd <BUVA.S> contributed 31.3 mln dlrs
while its share of Comalco Ltd's <CMAC.S> net was 37.8 mln.
Net earnings from iron-ore operations were 111.8 mln dlrs
against 149.2 mln in 1985, it said.
Lead, zinc and silver mining and smelting operations
incurred a net loss of 66.8 mln dlrs against a 38.1 mln loss in
1985, CRA said.
Coal activities resulted in a net profit of 36.7 mln dlrs
against 34.1 mln, while salt raised its contribution to 4.7 mln
from 2.8 mln.
CRA's share of earnings from the Argyle diamond project
amounted to 12.0 mln dlrs against nine mln in 1985.
CRA said the main item in its 250.28 mln dlr extraordinary
loss was a 172.9 mln writeoff of unrealised foreign exchange
losses on borrowings as required by a new accounting standard.
Other extraordinary items were 63.3 mln dlrs provided for
closures and writedown of assets and a 14.1 mln increase in
future tax provisions, CRA said.
Cash flow continued at a high level, being 950.6 mln dlrs
before capital expenditure against 1.02 billion in 1985. The
strong cash flow, coupled with the proceeds of the 1986 rights
issue and the use of existing cash balances, enabled group debt
to be reduced by nearly 500 mln dlrs.
CRA said it held forward contracts at year-end to buy 985
mln U.S. Dlrs to hedge part of its foreign debt. This cost 47.0
mln dlrs after tax, included in the net interest cost.
REUTER
|
MONTEDISON UNIT ISSUES 50 MLN AUSTRALIAN DLR BOND | Montedison Finance Overseas Ltd, a unit
of Montedison SpA, is issuing a 50 mln Australian dlr eurobond
due April 3, 1990 paying 15-1/2 pct and priced at 101-3/8 pct,
lead manager Orion Royal Bank Ltd said.
The non-callable bond is guaranteed by the parent. The
selling concession is one pct while management and underwriting
combined pays 1/2 pct.
The issue will be listed in Luxembourg and is available in
denominations of 1,000 and 10,000 Australian dlrs. The payment
date is April 3.
REUTER
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SWISS CAPITAL EXPORTS RISE IN JANUARY | Swiss capital exports rose to 4.64
billion francs in January after 2.54 billion in December and a
year earlier 3.64 billion, the Swiss National Bank said.
New bond issues accounted for 4.12 billion of the total
after December's 2.15 billion, and credits 525.1 mln after
389.9 mln.
In January 1985, before the National Bank ended the
distinction between notes and bonds, bond issues totalled 1.66
billion francs, notes 1.39 billion and credits 597.5 mln.
REUTER
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CHINA CALLS FOR BETTER TRADE DEAL WITH U.S. | China called on the United States to
remove curbs on its exports, to give it favourable trading
status and ease restrictions on exports of high technology.
But the U.S. Embassy replied that Chinese figures showing
13 years of trade deficits with the U.S. Out of the last 15 are
inaccurate and said Peking itself would have to persuade
Congress to change laws which limit its exports.
The official International Business newspaper today
published China's demands in a editorial to coincide with the
visit of U.S. Secretary of State George Shultz.
"It is extremely important that the U.S. Market reduce its
restrictions on Chinese imports, provide the needed facilities
for them and businessmen from both sides help to expand Chinese
exports," the editorial said.
"The U.S. Should quickly discard its prejudice against
favourable tariff treatment for Chinese goods and admit China
into the Generalised System of Preference (GSP).
"Despite easing of curbs on U.S. Technology exports in
recent years, control of them is still extremely strict and
influences normal trade between the two countries," it added
The paper also printed an article by China's commercial
counsellor in its Washington embassy, Chen Shibiao, who said
that "all kinds of difficulties and restrictions" were preventing
bilateral trade fulfilling its full potential.
He named them as U.S. Protectionist behaviour, curbs on
technology transfer and out-of-date trade legislation.
The paper also printed a table showing that, since
bilateral trade began in 1972, China has had a deficit every
year except 1972 and 1977. It shows the 1986 and 1985 deficits
at 2.09 billion and 1.722 billion dlrs.
A U.S. Embassy official said the U.S. Did not accept
Peking's trade figures at all, mainly because they exclude
goods shipped to Hong Kong and then trans-shipped to U.S. While
U.S. Figures are based on country of origin.
He said that, if China wants to obtain GSP status, it will
have to lobby Congress itself to persaude it to amend several
laws which currently prevent Peking getting such status.
The U.S. Trade Act of 1974 says that to qualify for GSP,
China must be a member of the General Agreement of Tariffs and
Trade (GATT), for which it applied in July 1986, and "not be
dominated or controlled by international Communism."
The official said China was well aware of the laws, some
of which date to the anti-Communist early 1950's, but that
there is not sufficient political will in the U.S. To change
them.
China has been the subject of about a dozen cases
involving anti-dumping in the U.S. Within the last two years,
which the U.S. Side won, he said.
But, for the first time, China signed last week an
agreement which it itself initiated to voluntarily restrain
exports of at least two categories of steel goods, which may
lead the U.S. Side to withdraw the anti-dumping case, he added.
Another diplomat said willingness to provide such
voluntary export restraints would be an important issue in
bilateral trade issues and in Peking's application to GATT.
"China has the potential to disrupt world markets,
especially in textiles. Other GATT countries will be nervous
about China in this respect. But there is a precedent for other
centralled planned economies in GATT," the diplomat said.
Poland, Czechoslovakia, Hungary and Romania are members of
GATT but none has China's massive market potential for imports
or its vast labour pool to produce cheap exports.
In a speech today in the northeast city of Dalian, U.S.
Secretary of State George Shultz said his country welcomed
China's interest in participating in GATT.
"The process of Chinese accession will not be accomplished
overnight -- the GATT rules were not designed for a large
economy of the Chinese type," Shultz said.
"China can play an important role by actively joining GATT
discussions seeking to expand general trading opportunities and
enhance market access for exports worldwide. China can further
develop its foreign trade system so as to gain the maximum
benefit from its GATT participation," he said.
The problems facing U.S.-China trade and GATT membership
are similar -- a pricing system which many foreign businessmen
regard as arbitrary and not related to actual costs, especially
for exports, and a de facto dual currency system.
In a memorandum backing its application presented to GATT
last month, China said it was gradually reforming its economic
system and replacing mandatory instruction with "guidance
planning" and economic levers.
The diplomat said that, to join GATT, China had much to
do.
REUTER
|
NO BUNDESBANK POLICY CHANGES EXPECTED THURSDAY | The Bundesbank is unlikely to change
its credit policies at its central bank council meeting on
Thursday, as exchange rates and short-term interest rates have
stabilized over the past few weeks, money market dealers said.
Attention in the money market is focused on tomorrow's
tender for a securities repurchase pact, from which funds will
be credited on Thursday, when an earlier pact expires, draining
16 billion marks from the system.
The tender was announced last Friday, because carnival
festivities closed banks in Duesseldorf yesterday, and will
close banks here this afternoon.
Because of the disruption to business from carnival,
minimum reserve figures for the start of the month are
unrealistic, making it difficult for banks to assess their
needs at the tender.
Dealers said the Bundesbank would want to inject enough
liquidity in this week's pact to keep short-term rates down.
But because of uncertainty about banks' current holdings,
the Bundesbank may well allocate less than 16 billion marks
this week, and top it up if necessary at next week's tender.
"I would not be surprised if the Bundesbank cuts the amount
a little, to say 14 or 15 billion marks," one dealer said.
"They would then stock it up at the next tender when the
need is clearer," he added.
An earlier pact expires next week, draining 8.5 billion
marks from the system. Banks also face a heavy but temporary
drain this month from a major tax deadline for customers.
Banks held 52.0 billion marks on February 27 at the
Bundesbank, averaging 51.0 billion over the whole month, just
clear of the 50.5 billion February reserve requirement.
Call money traded today at 3.85/95 pct, up from 3.80/90
yesterday.
REUTER
|
TAIWAN BANKS ASKED TO TAKE PART IN INDONESIA LOAN | Chase Manhattan Asia Ltd of Hong Kong has
approached Taiwan banks to take part in a syndicated loan of
300 mln U.S. Dlrs to finance a liquefied natural gas (LNG)
project in Indonesia, local banking sources said.
The project calls for construction of a 400 mln U.S. Dlr
facility which could produce two mln tonnes of LNG for supply
by Taiwan's state-owned Chinese Petroleum Corp .
This was the first time Taiwanese banks, including the Bank
of Taiwan and Bank of Communications, were invited to form a
syndicated loan, they added.
Pertamina has initialled a 20-year contract with Chinese
Petroleum Corp <CPC> for the supply of 1.5 mln tonnes of LNG
for Taiwan starting October 1989, a CPC official said.
CPC is building an LNG receiving terminal in southern
Taiwan city of Kaohsiung at a cost of 820 mln U.S. Dlrs. The
terminal will be completed in mid-1989.
A Taiwanese banker said"It will be a good idea for our banks
to take part in the loan if we want to start in the
international lending market."
REUTER
|
COUNCIL OF EUROPE ISSUES LUXEMBOURG FRANC BOND | The Council of Europe is issuing a
125 mln luxembourg franc private placement bond carrying a
7-1/4 pct coupon and priced at par, lead manager Banque
Internationale a Luxembourg SA (BIL) said.
The non-callable, bullet issue maturing in August 1992
follows an earlier private placement bond announced last month
for 250 mln francs but with the same conditions.
The new issue is for payment on March 31 and coupon
payments annually on August 11, with the first coupon a long
coupon.
REUTER
|
ITALY CONSUMER PRICES RISE 0.4 PCT IN FEBRUARY | Italy's consumer price index rose 0.4 pct
in February compared with January after rising 0.6 pct in
January over December, the national statistics institute
(Istat) said.
The year-on-year rise in February was 4.2 pct down from 4.5
pct in January and compared with 7.6 pct in February 1986.
Istat said its consumer prices index for the families of
workers and employees (base 1985) was 109.1 in February against
108.7 in January and 104.7 in February 1986.
REUTER
|
MOBIL PLAN TO OPEN PEKING OFFICE, CHINA DAILY SAYS | Mobil Corp <MOB.N> of the U.S. Plans to
open an office in Peking to develop oil exploration
opportunities in China, the China Daily said.
It quoted Mobil president Richard Tucker, currently in
Peking, as saying he is optimistic about investment prospects
in China and that Peking will continue to encourage foreign
private businesses to invest here.
It said Mobil bought 73 mln dlrs of crude oil and oil
products from China in 1986 and sold it lubricant and
fertiliser, but gave no more details.
REUTER
|
EC ISSUES 600 MLN FRENCH FRANC EUROBOND | The European Community (EC) is issuing a
600 mln franc 8-3/4 pct bond due April 7, 1997, at 99-1/2 pct,
lead manager Banque Nationale de Paris said.
Fees total two pct, with 1-3/8 pct for selling and 5/8 pct
for management and underwriting combined.
Payment date is April 7, denominations are of 10,000 and
50,000 francs and listing is in Luxembourg and Paris.
REUTER
|
KLM TO TAKE 15 PCT STAKE IN AIR UK | KLM Royal Dutch Airlines <KLM.A> said
it agreed to take a 15 pct stake in Air U.K. Ltd, a subsidiary
of British and Commonwealth Shipping Plc <BCOM.L>, in a
transaction worth around two mln stg.
A KLM spokesman said KLM already cooperated closely with Air
UK, which runs 111 flights a week to Amsterdam's Schipol
airport from nine UK cities.
British and Commonwealth Shipping said last week it held
preliminary talks about a KLM minority stake in Air U.K. But
gave no further details. KLM said it hoped the move would
attract more British feeder traffic to Amsterdam Airport.
REUTER
|
AIRBUS SIGNS ONE BILLION DLR JAPANESE CONTRACT | The European <Airbus Industrie> consortium
has signed a one billion dlr contract to sell 10 A320
short-haul jets to <All Nippon Airways> of Japan, with an
option on the sale of a further 10 planes, an Airbus spokesman
said today.
The 10 planes on firm order will be delivered between
September, 1990 and November, 1991, and will be powered either
by CFM-56-5S engines made by the Franco-U.S. <CFM
International> consortium, or V2500S engines built by the
<International Aero Engine> group.
The spokesman declined to comment on a New York Times
report that Airbus is about to announce a sale to American
Airlines.
But industry sources said American was about to announce
the purchase of 25 wide-bodied planes from Airbus, as well as
15 747s from Boeing Co <BAN>.
Airbus has already signed large deals with Pan Am Corp
<PNN>, NWA Inc <NWA> and Eastern Airlines Inc <EALN>, as well
as a smaller contract with <Continental Airlines>.
The A320 made its first flight on February 22 and is not
due to enter commercial service until March next year.
The All Nippon purchase brings the total number of
commitments to the A320 to 439 from 16 airlines, comprising 275
firm orders and 164 options.
REUTER
|
FRENCH BOND COMMITTEE APPROVES THREE ISSUES | The French domestic bond issuing committee
said it has approved three new issues totalling 1.8 billion
francs.
Credit Lyonnais will lead manage a 1.2 billion franc issue
for the Caisse Centrale de Credit Cooperatif. Banque Francaise
de l'Agriculture will lead, with Union de Garantie et de
Placement, a 300 mln franc issue for its own account.
Caisse Centrale des Banques Populaires will lead a 300 mln
issue for the Groupement des Industries pour le Batiment et
Travaux Publics. No further details were immediately available.
REUTER
|
DEGUSSA COMBINES PHARMACEUTICAL INTERESTS | Degussa AG <DGSG.F> is combining its
foreign and domestic pharmaceutical activities into the
Frankfurt-based <Asta Pharma AG>, so as to promote its business
in that sector, the company said.
Group consolidated turnover in Degussa's pharmaceuticals
sector rose to 380 mln marks in 1985/86 to September 30 from
377 mln marks in the preceding year, the company said.
Turnover from all pharmaceutical interests, including
minority holdings, was 700 mln marks in 1985/86, somewhat
higher than in the preceding year. The company did not disclose
exact 1984/85 results in that sector, a spokesman said.
REUTER
|
U.K. RESERVES SHOW UNDERLYING RISE IN FEBRUARY | Britain's gold and currency reserves
showed an underlying rise of 287 mln dlrs in February, after a
72 mln dlrs rise in January, the Treasury said.
The underlying trend, which is a guide to Bank of England
operations to support the pound on foreign exchanges, is net of
borrowings and repayments.
This was above market expectations for a 100 mln dlrs rise.
The Treasury said the Bank of England used the opportunity
of strong demand to rebuild reserves after losses last autumn
and said the underlying rise was still relatively modest.
Actual reserves rose by 305 mln dlrs in February to 22.26
billion dlrs, after rising 29 mln in January to 21.95 billion.
Accruals of borrowings under the exchange cover scheme were
36 mln dlrs last month, after 163 mln in January, while
repayments were 16 mln dlrs after the previous 151 mln, a
Treasury spokesman said.
Capital repayments totalled two mln dlrs. In January,
capital repayments totalled 14 mln dlrs, with a valuation
change that resulted in a fall of 41 mln dlrs due to the
quarterly rollover from the European Monetary Cooperation Fund
swap.
The Treasury would not comment on the Bank of England's
market operations, but currency traders reported moderate Bank
of England intervention to curb upward pressure on the pound
today.
A Treasury spokesman, commenting on the reserves figures,
said that the government does not want sterling either to rise
too far or to fall substantially from current levels.
He noted that the Chancellor of the Exchequer Nigel Lawson
stressed this after the recent Paris currencies meeting.
REUTER
|
COMALCO SAYS LOWER COSTS HELP RETURN TO PROFITS | Comalco Ltd said its return to profit
reflected reduced costs, improved primary aluminium prices and
its withdrawal from a Japanese smelter venture.
It said the earlier reported 57.1 mln dlr profit for the
year ended December 31 against a 69.13 mln dlr loss in 1985 was
also aided by lower interest rates on U.S. Dollar debt and
greater sales of bauxite and aluminium.
Comalco said it expected to pay at least a four cents per
share final dividend, delayed until July 1 to take advantage of
proposed dividend imputation laws.
This would make five cents for the year against a first and
final of one cent in 1985.
Comalco said the aluminium industry continues to suffer
from low prices and excess capacity, though the weak Australian
dollar had helped earnings.
Comalco's Commonwealth Aluminium Corp unit said earlier it
has conditionally agreed to sell its Goldendale smelter in
Washington, and port facilities at Portland, Oregon to Columbia
Aluminium Corp. Comalco said its extraordinary provision of
27.3 mln dlrs costs for Goldendale losses and closure may be
reduced if the sales agreement were completed.
REUTER
|
ULTRAMAR SELLS U.K. MARKETING UNITS FOR 50 MLN STG | Ultramar Plc <UMAR.L> said it had reached
agreement in principle to sell its wholly owned U.K. Marketing
companies to Kuwait Petroleum Corp for around 50 mln stg.
Ultramar's marketing units include <Ultramar Golden Eagle
Ltd> which in 1985 made a profit of around 1.4 mln stg before
financing and group administration charges. A small loss was
recorded for the first nine months of 1986.
The sale is due to take place on April 1 with the proceeds
intended to reduce group debt in the short term. But Ultramar
said the funds would ultimately be used for further development
of its core businesses in the U.K. And North America.
REUTER
|
HONG KONG M3 RISES 2.2 PCT IN JANUARY | Hong Kong's broadly defined M3 money
supply rose 2.2 pct to 607.17 billion H.K. Dlrs in January,
after a 3.1 pct rise in December, for a year-on-year rise of
23.3 pct, the government said in a statement.
Local currency M3 rose 3.6 pct to 280.36 billion dlrs from
December when it was up 3.4 pct from November, for a rise of
16.3 pct on the year.
Total M2 rose 3.3 pct to 535.26 billion dlrs in January
from December when it rose 3.5 pct on the previous month. Local
M2 rose 4.7 pct to 249.03 billion dlrs in January from December
when it climbed 4.2 pct.
Total M2 and local M2 rose 32.5 pct and 23.9 pct on the
year-ago month, respectively.
Total M1 rose 12 pct to 62.84 billion dlrs in January after
a 5.0 pct rise the previous month. Local M1 rose 12.3 pct to
57.97 billion dlrs after a 6.2 pct rise. Total M1 and local M1
year-on-year growth was 32.5 and 32.6 pct, respectively.
Total loans and advances rose 3.3 pct to 517.19 billion
dlrs from December when they rose 1.2 pct.
Loans for financing Hong Kong's visible trade rose 3.4 pct
to 36.72 billion dlrs after a 1.8 pct rise in December.
REUTER
|
WOOLWORTH, UNDERWOODS FAIL TO AGREE ON BID | <Underwoods Plc> said it had not been
possible to agree terms on a bid to be made by Woolworth
Holdings Plc <WLUK.L> during talks.
The two companies had been holding exploratory discussions.
No spokesman for either company was immediately available to
say why terms could not be agreed, nor whether the possibility
of a bid was now being abandoned.
Last week, Underwoods shares rose 49p to 237p ahead of any
announcement of the talks. The announcement today brought them
back down to 214p from last night's close at 241p. Woolworth
was unchanged at 758p.
REUTER
|
NO BUNDESBANK POLICY CHANGES EXPECTED THURSDAY | The Bundesbank is unlikely to change
its credit policies at its central bank council meeting on
Thursday, as exchange rates and short-term interest rates have
stabilized over the past few weeks, money market dealers said.
Attention in the money market is focused on tomorrow's
tender for a securities repurchase pact, from which funds will
be credited on Thursday, when an earlier pact expires, draining
16 billion marks from the system.
The tender was announced last Friday, because carnival
festivities closed banks in Duesseldorf yesterday, and will
close banks here this afternoon.
Because of the disruption to business from carnival,
minimum reserve figures for the start of the month are
unrealistic, making it difficult for banks to assess their
needs at the tender.
Dealers said the Bundesbank would want to inject enough
liquidity in this week's pact to keep short-term rates down.
But because of uncertainty about banks' current holdings,
the Bundesbank may well allocate less than 16 billion marks
this week, and top it up if necessary at next week's tender.
"I would not be surprised if the Bundesbank cuts the amount
a little, to say 14 or 15 billion marks," one dealer said.
"They would then stock it up at the next tender when the
need is clearer," he added.
An earlier pact expires next week, draining 8.5 billion
marks from the system. Banks also face a heavy but temporary
drain this month from a major tax deadline for customers.
Banks held 52.0 billion marks on February 27 at the
Bundesbank, averaging 51.0 billion over the whole month, just
clear of the 50.5 billion February reserve requirement.
Call money traded today at 3.85/95 pct, up from 3.80/90
yesterday.
REUTER
|
U.K. MONEY MARKET SHORTAGE FORECAST REVISED UP | The Bank of England said it revised up
its forecast of the shortage in the money market today to
around 500 mln stg from its initial estimate of 350 mln.
REUTER
|
PAKISTAN TO RETENDER FOR RBD PALM OIL TOMORROW | Pakistan will retender for 6,000 tonnes
of refined bleached deodorised palm oil for second half March
shipment tomorrow, after failing to take up offers today, palm
oil traders said.
REUTER
|
MOBIL PLANS TO OPEN OFFICE IN PEKING | Mobil Oil Corp of U.S. Plans to open an
office in Peking to develop oil exploration opportunities in
China, the China Daily said.
It quoted Mobil president Richard Tucker, currently in
Peking, as saying he is optimistic about investment prospects
in China and that Peking will continue to encourage foreign
private businesses to invest here.
It said Mobil bought 73 mln dlrs of crude oil and oil
products from China in 1986 and sold it lubricant and
fertiliser, but gave no more details.
Reuter
|
MERRILL MANDATED FOR IEL U.S. NOTE. | Merrill Lynch Capital Markets said it
received a mandate from Industrial Equity Ltd (IEL) of
Australia to arrange a letter of credit facility in support of
100 mln dlrs of medium term notes and U.S. Commercial paper to
be sold in the U.S. Domestic market.
Merrill, which will be the dealer for the medium term notes
and commercial paper, said this was the first facility of its
kind. Sumitomo Trust and Banking Co Ltd has agreed to provide
the letter of credit.
The letter of credit has a five year term, with an
evergreen feature allowing for extension at the support banks'
option.
The notes and paper will be issued by IEL's Sydney-based
subsidiary, IEL Finance Ltd.
The letter of credit will be underwritten by a group of
banks who will be paid a 20 basis point facility fee and a 25
basis point utilisation fee.
IEL itself is 51 pct owned by Brierley Investments Ltd of
New Zealand, Merrill Lynch said.
REUTER
|
EC, EURATOM FRENCH FRANC EUROBONDS EXPECTED | The European Community (EC) and Euratom,
the European atomic energy agency, are expected to issue French
franc eurobonds this month, a Treasury spokesman said.
Other eurofranc bonds this month are likely to include
issues by a bank and a company, both unidentified, but no other
details were available. The spokesman said the March calendar
would be flexible, to take account of market conditions.
REUTER
|
AUSTRALIAN POLICE ARREST FORMER WESTPAC CLERK | Australian police said they charged a
former currency clerk of Westpac Banking Corp <WSTP.S> with
misappropriating 8,300 dlrs in July in an alleged
foreign-exchange fraud.
A spokeswoman for the New South Wales Corporate Affairs
Commission (CAC) said the arrest was part of its investigation
stemming from complaints from Westpac and <Kleinwort Benson
Australia Ltd>.
CAC and Westpac officials said they were working out how
much money was involved, but said press reports it was as much
as five mln dlrs were probably exaggerated.
Reuter
|
Unilever Plc and Nv combined 1986 pre-tax profit 1.14 billion stg vs 953 mln.
| |
GERMAN BANKS SEEK GREATER BRAZIL LINK WITH IMF | West German banks would like Brazil to work
more closely with the International Monetary Fund (IMF) with a
view to seeking a solution to the country's debt problems,
senior West German banking sources said.
The sources, speaking ahead of a meeting later today
between Brazilian Finance Minister Dilson Funaro and his West
german counterpart Gerhard Stoltenberg, also believed Brazil
should come up with a convincing economic recovery program.
Their comments echoed those of British Chancellor of the
Exchequer Nigel Lawson, who met Funaro yesterday.
Funaro is currently on a European trip seeking to involve
governments in negotiations with commercial banks on
rescheduling part of Brazil's foreign debt, which totals some
109 billion dlrs. But Lawson told Funaro Brazil had to solve
its problems with the banks rather than governments.
Diplomatic sources in Bonn said Funaro would leave early
tomorrow morning for Zurich after meeting Stoltenberg this
evening.
Funaro has rejected suggestions for negotiations with the
IMF and said there is no question of Brazil agreeing to an
austerity program with the Fund.
However, the West German banking sources said institutions
here felt it was particularly important that Brazil presented a
credible recovery program and that there be a "rapprochement"
with the IMF.
"Consultations are the least that can be expected," said one
banker.
Funaro's trip follows the decision by Brazil 10 days ago to
suspend interest payments on 68 billion dlrs of commercial
debt. It has also frozen bank and credit lines deposited by
foreign banks and institutions worth about 15 billion dlrs.
One senior banker closely involved in Brazilian debt
negotiation offered qualified support for a call from Funaro
for a change in the structure of the advisory committee of
banks which has coordinated Brazilian debt since 1982.
Funaro said yesterday that U.S. Banks, holding 35 pct of
Brazilian debt, were over-represented on the 14-bank advisory
committee with 50 pct of the committee seats. He said Brazil
might adopt a different approach to its creditor banks,
involving separate discussions with the regions.
Such a move would be in Brazil's interest, since European
banks have been more supportive than U.S. Banks of alternative
debt solutions, such as interest capitalisation.
The senior banker was strongly opposed to a purely regional
approach, saying: "There must be one committee and one solution."
But he added: "There must be an understanding that special
requests from special regions be taken into account."
German banks had objected to the fact that the idea of
interest capitalisation had been rejected in the committee. It
was imperative that alternative options be considered. "The menu
must become richer," the banker said.
Banking sources said commercial banks would not be involved
in today's talks with Funaro. A spokesman for the Bundesbank in
Frankfurt said the central bank would also not be represented.
West German banks have taken a more relaxed attitude to the
Brazilian suspension of interest payments than institutions in
the United States, because of their lower exposure.
According to Bundesbank data from September last year, West
German bank exposure to Latin America of slightly under 16
billion marks represented less than five pct of all foreign
credit.
REUTER
|
AQUINO ANNOUNCES LAND REFORM PLANS | President Corazon Aquino announced
government plans to devote to land reform an estimated 24
billion pesos (about one billion U.S. Dlrs) raised from the
sale of failed businesses taken over by the government.
Aquino said she was willing to have her family's sugar
estate broken up in compliance with Philippine land reform
programmes but hinted it would not be offered voluntarily.
"Whatever laws will be enacted, I say that nobody is above
the law and that includes me. My brothers and sisters are
Filipino citizens ... We will abide by whatever laws are
enacted as far as sugar land is concerned," she told reporters.
A committee was now formulating guidelines for the plan,
including the question of whether land operated by
multinational companies should also be covered, she added.
Agrarian Reform Secretary Heherson Alvarez said recently
the government planned to distribute 9.7 mln hectares of land
to impoverished farmworkers under a revised land reform
programme.
The plan, requiring about 1.7 billion dlrs, now also covers
sugar and coconut areas, apart from rice and corn lands, he
said. It was expected to benefit about three mln landless
peasants, he added.
Land reform pressure groups have called on Aquino to break
up her family's 6,000-hectare sugar estate to demonstrate her
sincerity on the issue political analysts have called one of
the most pressing problems facing the Philippines.
It was not known whether government would wait for the
Congress to convene by mid-year to formalise the programme or
have Aquino carry it out through an executive order.
Under the plan, government will purchase land mainly from
landowners with holdings over seven hectares. It will include
vacant and untenanted farmland as well as 50,000 hectares
seized from former associates of deposed president Ferdinand
Marcos.
REUTER
|
OPEC WITHIN OUTPUT CEILING, SUBROTO SAYS | Opec remains within its agreed output
ceiling of 15.8 mln barrels a day, and had expected current
fluctuations in the spot market of one or two dlrs, Indonesian
Energy Minister Subroto said.
He told reporters after meeting with President Suharto that
present weakness in the spot oil market was the result of
warmer weather in the U.S. And Europe which reduced demand for
oil.
Prices had also been forced down because refineries were
using up old stock, he said.
He denied that Opec was exceeding its agreed production
ceiling. Asked what Opec's output level was now, he replied:
"Below 15.8 (mln barrels per day)." He did not elaborate.
He said there appeared to have been some attempts to
manipulate the market, but if all Opec members stick by the
cartel's December pricing agreement it would get through
present price difficulties.
He predicted that prices would recover again in the third
and fourth quarters of 1987.
He also reiterated that there was no need for an emergency
Opec meeting.
He said Opec had expected to see some fluctuations in the
spot price. "We hope the weak price will be overcome, and
predict the price will be better in the third and fourth
quarters."
Refiners, he said, appeared to have used up old stock
deliberately to cause slack demand in the market and the price
to fall. But Opec would get through this period if members
stuck together.
REUTER
|
U.K. MONEY MARKET GIVEN 24 MLN STG ASSISTANCE | The Bank of England said it provided 24
mln stg help to the money market in the morning session.
This compares with the bank's upward revised shortage
forecast of around 500 mln stg.
The central bank purchased bank bills outright comprising
two mln stg in band one at 10-7/8 pct and 22 mln stg in band
two at 10-13/16 pct.
REUTER
|
COUPON ON MITSUBISHI WARRANT BOND CUT | The coupon on the 300 mln dlr equity
warrant bond deal for Mitsubishi Estate Co Ltd has been cut to
three pct from the 3-1/4 pct initially indicated, Nikko
Securities Co (Europe) Ltd said as lead manager of the deal.
Exercise price for the warrants has been fixed at yen 2,817
representing a 2.53 pct premium over the latest Tokyo close
adjusted for a free share issue this month.
Foreign exchange fix is yen 154.65/dlr and payment date on
the deal is March 20.
REUTER
|
JAPAN'S UNEMPLOYMENT RATE SEEN RISING TO 3.5 PCT | Japan's unemployment rate is expected to
continue to climb to about 3.5 pct within the next year from
January's three pct record, senior economists, including Susumu
Taketomi of Industrial Bank of Japan, said.
December's 2.9 pct was the previous worst level since the
government's Management and Coordination Agency began compiling
statistics under its current system in 1953.
"There is a general fear that we will become a country with
high unemployment," said Takashi Kiuchi, senior economist for
the Long-Term Credit Bank of Japan Ltd.
The government, which published the January unemployment
figures today, did not make any predictions.
"At present we do not have a forecast for the unemployment
rate this year, but it is difficult to foresee the situation
improving," a Labour Ministry official said.
Finance Minister Kiichi Miyazawa said the government had
expected the increase and had set aside money to help 300,000
people find jobs in fiscal 1987 beginning in April.
Prime Minister Yasuhiro Nakasone told a press conference
the record rate underlines the need to pass the 1987 budget
which has been held up by opposition to proposed tax reforms.
The yen's surge has caused layoffs in the mainstay steel
and shipbuilding industries. Other export-dependent industries,
such as cars and textiles, have laid off part-time employees
and ceased hiring, economists said.
Although the growing service industry sector has absorbed a
great number of workers the trend is starting to slow down,
said Koichi Tsukihara, Deputy General Manager of Sumitomo Bank
Ltd's economics department.
However, other economists disagreed, saying the service
sector would be able to hire workers no longer needed by the
manufacturing sector over the next five years.
Reuter
|
TAIWAN REJECTS TEXTILE MAKER PLEA ON EXCHANGE RATE | Central bank governor Chang Chi-cheng
rejected a request by textile makers to halt the rise of the
Taiwan dollar against the U.S. Dollar to stop them losing
orders to South Korea, Hong Kong and Singapore, a spokesman for
the Taiwan Textile Federation said.
He quoted Chang as telling representatives of 19 textile
associations last Saturday the government could not fix the
Taiwan dollar exchange rate at 35 to one U.S. Dollar due to
U.S. Pressure for an appreciation of the local currency.
The Federation asked the government on February 19 to hold
the exchange rate at that level.
Reuter
|
JAPANESE DEMAND FOR U.K. GILTS SEEN RISING | Japanese investor interest in British
gilt-edged securities is growing rapidly due to expectations
sterling will remain stable despite the drop in oil prices, and
on calculations gilt prices will firm, bond managers said.
Japanese, British and U.S. Securities houses have been
expanding inventories of gilts to meet demand from investors
seeking capital gains, including city and trust banks, which
have been active on the U.S. Treasury market, they said.
Dealing demand for gilts with coupons around 10 pct has
been getting stronger, the general manager of the local office
of a British securities firm said.
On the other hand, major long-term investors such as
Japanese insurance companies are not very enthusiastic about
buying British securities ahead of the March 31 close of the
Japanese financial year, traders said.
These investors, who must convert yen into sterling through
dollars for British securities purchases, appear to be buying
in London rather than in Tokyo, a bond manager for a British
securities house said.
The sterling/yen rate was about 240.34/44 today, up from
234.50 at the start of the calendar year and a narrow range of
230 to 234 late last year.
Many bond traders in Tokyo are doubtful that sterling will
further appreciate steeply. However, gilts may benefit from
further declines in U.K. Interest rates, they said.
"The U.K. Government is in no hurry to issue more bonds,
suggesting further market improvement and continuing demand
from brokers here," said Laurie Milbank and Co assistant manager
Machiko Suzuki.
She said she expected the yield on the actively traded
11-3/4 pct gilt due March 2007 to dip below 9.5 pct, against
9.581 pct at yesterday's close in London.
REUTER
|
DAIMLER OUTPUT COULD BE AFFECTED BY DISPUTE | Daimler-Benz AG [DAIG.F] said its car
production could fall by 150 cars a day in the foreseeable
future if works councils continue to refuse to approve the
firm's requests for employees to work overtime when necessary.
A company spokesman said the works council at Daimler's
Unterturkheim plant, which makes axles and other components for
Daimler cars, has withheld approval for overtime since the
beginning of the month. The IG Metall metalworkers union in the
state of Baden-Wuerttemberg has called on works councils in the
state to reject overtime in a bid to get industry to employ
more workers.
The Daimler spokesman said the lack of overtime work at the
Unterturkheim plant could eventually affect car output at other
plants but added he was unable to say when this might occur.
A spokesman for Dr.-Ing. H.C. F. Porsche AG [PSHG.F], which
is also located in Baden-Wuerttemberg, said he did not think
Porsche would suffer any loss of production because of a ban on
overtime by its own works councils.
A strike by IG Metall in Baden-Wuerttemberg in 1984 closed
down the German car industry for about seven weeks as the union
sought to win a 35-hour working week for its members. It later
settled for a reduction in the working week to 38.5 hours.
The spokesman said Daimler's total output of cars was
currently around 2,500 a day.
REUTER
|
HK HOTELS SOARS ON TAKEOVER SPECULATION | The price of Hongkong and Shanghai
Hotels Ltd <SHLH.HK>'s stock soared on speculation of a
takeover battle between major shareholders the Kadoorie family
and the Evergo Industrial Enterprise Ltd <EVGH.HK> group, stock
brokers said.
They noted heavy buying in Hk Hotel shares after an
announcement by Evergo's <China Entertainment and Land
Investment Co Ltd> unit that it bought about 20 pct of Hk
Hotels from the firm's deputy chairman David Liang for 1.06
billion dlrs. The stock rose 12 H.K. Dlrs to 62 dlrs today.
Thomas Lau, Evergo's executive director, declined comment
on whether the group is seeking a further stake in Hk Hotels.
But he told Reuters the group will hold the 20 pct stake bought
from Liang as long term investment.
He said Evergo "was attracted by the underlying strength of
Hk Hotels."
Analysts said Evergo may be looking for a possible
redevelopment of the Peninsula Hotel, one of Asia's best known
hotels, and another site on Hong Kong island. Both are owned by
Hk Hotels.
<Lai Sun Garment Co ltd> yesterday said it acquired a 10
pct stake in Hk Hotels from Liang for 530 mln dlrs.
Lau denied any link between China Entertainment and Lai Sun
on their acquisitions of the Hk Hotels stake.
"It is purely coincidence," he said.
But analysts were not so certain, saying that the Evergo
group, which has a reputation as a corporate raider, may team
up with Lai Sun Garment for a takeover.
Lau also denied any contact with the Kadoorie family, which
analysts estimate has more than 20 pct of Hk Hotels. Michael
Kadoorie is chairman of Hk Hotels.
Lau said two representatives of Evergo will be nominated to
the Hk Hotels board.
A source close to the Kadoorie family said the family has
not considered any countermoves so far.
Analysts said it would be difficult for Evergo and the
Kadoorie family to cooperate because of different management
styles.
"Evergo may want to split up the hotel management and
property developments of Hk Hotels but that strategy may not
fit the conservative Kadoorie family," said an analyst who asked
not to be named.
Another analyst noted the price of Hk Hotels had been
distorted by the takeover talks because its net asset value is
only worth about 50 dlrs a share. The offers by Evergo and Lai
Sun were for 53 dlrs a share, though that is well below the
current trading price.
Trading was suspended today in shares of Lai Sun, Evergo,
China Entertainment and the group's associate <Chinese Estates
Ltd>.
Chinese Estates lost 25 cents to 20.15 dlrs yesterday,
China Entertainment five to 8.60 dlrs and Evergo one to 74
cents. Lai Sun gained 50 cents to 70.50 dlrs.
REUTER
|
OERLIKON UNIT REJECTS DUTCH PATENT CHARGES | Oerlikon-Buehrle Holding AG <OEBZ.Z> unit
<Contraves AG> unequivocally rejects charges by NV Philips
Gloeilampenfabrieken <PGLO.AS> subsidiary <Hollandse
Signaalapparaten BV> that it violated patent rights in a radar
system developed by the latter, a Contraves official said.
Max Baumann, a member of the Contraves board, told Reuters
his company was awaiting judgement in the case before a Zurich
court "quite calmly," but he declined to discuss it in detail.
Signaal claims Contraves included the Dutch firm's patented
X/KA double-frequency radar in an anti-aircraft system. Baumann
said he expected judgement to take several months at least.
REUTER
|
CASSA DI RISPARMIO DI ROMA LAUNCHING CD PROGRAM | Italian savings bank Cassa di Risparmio
di Roma is launching a 100 mln dlr euro-certificate of deposit
issuance program, Chase Investment Bank Ltd said as arranger.
Chase will also be a dealer for the program, along with
Swiss Bank Corporation International Ltd. Chase Manhattan Bank
NA, London Branch, will be issuing and paying agent.
The paper will be issued in denominations of 500,000 and
one mln dlrs.
REUTER
|
BRYSON PAYS 5.4 MLN DLRS FOR CENERGY CORP STAKE | <Bryson Oil and Gas Plc> said it paid a
cash consideration of around 5.4 mln dlrs for about 8.6 pct of
<Cenergy Corp>, a U.S. Oil and gas exploration and production
company.
Bryson said its board has been considering a number of
possible investments to expand the company's interests and
believes the opportunity to acquire an investment in Cenergy
provides a suitable extension to its existing U.S. Interests.
Cenergy reported a net loss of 7.27 mln dlrs in the nine
months to September 30, 1986 while total stockholders equity on
the same date was 40.72 mln dlrs.
REUTER
|
REAGAN APPROVAL RATING FALLS TO FOUR-YEAR LOW | President Reagan's approval rating fell
after the Tower Commission criticised his handling of the Iran
arms scandal, a New York Times/CBS poll indicates.
The poll found 51 pct of those surveyed thought he was
lying when he said he did not remember if he had approved the
original arms sales to Iran and 35 pct thought he was telling
the truth.
The poll found 42 pct of those surveyed approved Reagan's
handling of his job and 46 pct disapproved. The approval rating
was the lowest since January 1983, when 41 pct approved of the
way Reagan was doing his job.
REUTER
|
REGAN DEPARTURE MAKES 3RD VOLCKER TERM LIKELY | Last week's White House shake-up has
increased the odds that Federal Reserve Board chairman Paul
Volcker, a symbol of strength in a government reeling from the
arms-to-Iran scandal, will serve a third term, sources close to
the Fed say.
But they said that no decision on the appointment, which
must be filled this August, has been taken by the White House
and Volcker too has not made up his mind.
Former White House Chief of Staff Donald Regan, who
resigned last week when ex-senator Howard Baker was named as
his replacement, was implacably opposed to Volcker and tried
often to undermine him.
It is an open secret in Washington that Regan tried to
ensure that Volcker, first appointed in 1979 by President
Carter, will not be offered a third term by President Reagan.
Only Volcker's key allies in the Reagan administration,
Vice-President George Bush and Treasury Secretary James Baker,
kept Regan's recent maneuvering at bay, the sources said.
Sources close to the administration say Regan leaked a
story, quickly shot down by others in the administration, that
Beryl Sprinkel, chairman of the council of economic advisers,
had been chosen to replace Volcker.
But as the administration's credibility was increasingly
under fire, it became clear that Regan's power to bring about
such changes was on the wane.
The sources said New White House Chief of Staff Howard
Baker has a very good relationship with his namesake at the
Treasury Department and is likely to respect his views on the
Fed chairmanship.
As a moderate Republican, Baker is also unlikely to share
the right-wing's opposition to Volcker.
"This new White House is going to need all the strength it
can get," said one source when asked about the possibility of
Volcker's reappointment.
Paul Volcker is deeply respected in financial markets both
in the United States and around the world. At a time when the
stability of the dollar and the viability of major debtor
nations are in question, Volcker's departure would definitely
undermine U.S. leadership, foreign exchange analysts say.
U.S. officials say Volcker works very closely with Treasury
Secretary Baker on issues like international debt and global
economic cooperation.
The two men seem only to differ on how far to deregulate
the banking industry, but recent statements by Volcker, in
which he adopted a more liberal attitude on deregulation,
signalled the politically-independent central bank is coming
around at least partially to the Treasury position.
And a recent statement by a Reagan administration official
that the two men saw "exactly eye-to-eye" on the dollar was seen
as an indication of Baker's support for the Fed chairman.
Baker is understood to have played a key role in Volcker's
reappointment to the Fed in mid-1983.
The sources said Baker respects Volcker and when appointed
Treasury Secretary in February 1985, he decided to ensure a
good working relationship, in part because he believed the two
key government economic institutions have to work closely.
Regan, Treasury Secretary during President Reagan's first
term, was formerly head of Wall Street's largest brokerage firm
Merrill Lynch and came to Washington determined to be America's
pre-eminent economic spokesman.
He developed a deep antipathy for Volcker, whose political
skills undermined that ambition, and who financial markets took
much more seriously.
But the sources said Volcker would have to be invited to
stay. "Is the president going to ask him? he wouldn't stay
otherwise," said one. "He'd have to be asked," said Stephen
Axilrod, formerly staff director of monetary policy at the Fed
and now vice-chairman of Nikko Securities Co. International.
Otherwise, the list of potential candidates is not
awe-inspiring. And if Volcker left this Augsut, he would leave
behind one of the most inexperienced Fed Boards in years.
Many analysts believe this lack of collective experience --
the four sitting members were all appointed within the last
three years -- is dangerous, coming at a time when the global
economy is threatened by instability.
An experienced successor, therefore, would seem a
necessity. One widely mentioned possibility is Secretary of
State George Shultz, whose experience as Treasury Secretary
under Preesident Nixon and background as a trained economist
would make him ideal.
But Shultz too may have been damaged by the arms-to-Iran
scandal, while vice-chairman Manuel Johnson is regarded at 37
years old as too young for the job.
Other potential candidates include economist Alan
Greenspan, frequently an informal presidential economic
adviser, New York Fed President E. Gerald Corrigan, Federal
Deposit Insurance Corp chairman William Seidman, and Sprinkel.
Long a Regan protege, Sprinkel's chances may be damaged by
his patron's departure from the White House.
Reuter
|
GM <GM> CUTS WAGE BOOSTS FOR SALARIED EMPLOYEES | General Motors Corp has changed its
method of disbursing merit raises for salaried employees and is
reducing the size of the merit raise pool to 3.5 pct of the
total amount available for salaries from 5.5 pct last year, a
company spokesman said.
He said GM will no longer include merit raises in the
calculation of base pay but will make them simply lump-sum
payments. As a result, the merit raises will not be included
in the calculation of pensions and other benefits. The change
affects about 109,000 salaried workers in the U.S. and Canada.
GM last year eliminated cost of living increases for
salaried workers, making pay increases based on merit alone. As
a result of the new action, GM has effectively frozen the base
pay rates of salaried employees.
The spokesman said GM is making the change to remain
cost-competitive with other U.S. automakers.
GM is currently in thje midst of a program to cut
employment of salaried workers by 25 pct.
Reuter
|
PRE-PAID LEGAL <PPD> GETS I.C.H. <ICH> FINANCING | Pre-Paid Legal Services Inc said it
has signed a letter of intent under which it would receive
financing from I.C.H. Corp.
The company said under the proposed transaction I.C.H.
would loan it up to 100 mln dlrs, and the loan balance would be
convertible at any time by either party into Pre-Paid common
stock at 11 dlrs per share. In addition, it said it would
grant I.C.H. a five-year option to purchase new shares at the
same price. It said the option would enable I.C.H. to acquire
up to 500 pct plus one share of Pre-Paid common.
Pre-Paid said until expiration of the option, and as long
as Pre-Paid maintained a mutually agreeable combined loss and
expense ratio, I.C.H. would, on Pre-Paid's request, exercise as
much of the option as may be necessary to meet Pre-Paid's
funding needs.
The company said I.C.H. has requested the right to buy
90,909 Pre-Paid shares from Pre-Paid chairman Harland C.
Stoneciphjer for 11 dlrs each. Stonecipher now owns or has the
right to acquire 1,965,269 Pre-Paid shares and will agree to
restrictions on the sale of his remaining shares, it said. The
company saiod Stonecipher will remain chairman.
Pre-Paid said the transactions are subject to approval by
boards of both comnpanies and regulatory agencies.
Reuter
|
ASHTON-TATE <TATE> 4TH QTR NET | Shr 43 cts vs 30 cts
Net 10.6 mln vs 5,967,000
Revs 62.9 mln vs 41.5 mln
Avg shrs 200.7 mln vs 20.2 mln
Year
Shr 1.26 dlrs vs 85 cts
Net 30.1 mln vs 16.6 mln
Revs 210.8 mln vs 121.6 mln
Avg shrs 23.9 mln vs 19.4 mln
NOTE: Share adjusted for January 1987 two-for-one split.
Reuter
|
NEITHER SIDE OPTIMISTIC ON ROTTERDAM PORT ISSUES | Employers and the port union, FNV, are
to meet again this afternoon to attempt a settlement of the
six-week-old dispute in Rotterdam's general cargo sector, but
neither side is optimistic, spokesmen for both sides told
Reuters.
Little progress was made in last night's three hours of
talks, with both sides largely reiterating their positions.
"There is still a very large gap between the employers and
the FNV, and I can't say that we expect to reach any agreement.
But at least we are still talking," a union spokesman said.
Employers organization chairman, Jacques Schoufour, accused
the FNV of intransigence in refusing to alter its stance at all
over the past two months.
"The FNV is not serious about our discussions and I am
really not optimistic about it changing its point of view at
all."
"If we find this afternoon that the FNV still refuses to
accept the necessary redundancies in the general cargo sector,
then we will break off the talks and the redundancies may begin
later this month," Schoufour said.
The series of strikes, which employers say has cost them
more than seven mln guilders in lost import business in the
past six weeks, began on January 19 in protest at plans for 800
redundancies from the sector's 4,000 workforce starting with
350 this year.
Late last month Social Affairs minister Louw de Graaf said
unless the dispute was settled by yesterday he would withdraw
the sector's 10 mln guilder annual labour subsidy.
Both sides wrote to the minister yesterday setting out
their cases, but Schoufour said he did not expect to hear from
him before Wednesday at the earliest.
Reuter
|
AMR <AMR> TO HOLD PRESS CONFERENCE THIS MORNING | AMR Corp will hold a
press conference this morning in New York at 0900 EST, a
company spokesman said.
He would not comment on the subject of the press
conference, or would he confirm published reports that AMR will
today announce a 2.5 billion dlr purchase of aircraft and
engines.
According to a New York Times report, AMR is expected to
announce the purchase of 25 widebodied longrange A300's from
<Airbus Industrie> and 15 Boeing Co <BA> 767's and the choice
of General Electric Co <GE> to supply all 80 engines for the
craft. The engine order alone, for 80 CF80C-2's, would be
worth about 500 mln dlrs.
The Airbus plane order would be worth about 1.25 billion
dlrs and the Boeing order about 750 mln dlrs, according to the
report.
Reuter
|
UNILEVER IMPROVES IN MOST SECTORS DURING 1986 | The Unilever Plc and NV <UN.A> group saw
improved performance in almost all sectors during 1986, the
Anglo-Dutch group said in its results statement.
Very good progress was made last year, while the recent
acquisition of Chesebrough-Pond's Inc <CBM.N> was a significant
addition which will greatly benefit the group in the years to
come.
Earlier, Unilever reported combined fourth quarter pre-tax
profit of 276 mln stg, level with the year earlier period,
making 1.14 billion stg compared with 953 mln for the 1986 full
year.
Unilever said it plans to change its depreciation policy to
the more conventional practice of depreciating assets
individually rather than depreciating fixed assets at average
rates. The new method is expected to lead to a reduction in the
accumulated provision for depreciation and thereby increase the
net book value of tangible asssets by about 300 mln stg as at
January 1, 1987.
Unilever Plc shares are up 25p since yesterday at 2,575p in
buoyant response to the results and share split proposal,
though 1986 profits were not ahead of market forecasts, dealers
added.
REUTER
|
U.S. LEADING INDICATORS FELL 1.0 PCT IN JAN AFTER REVISED 2.3 PCT DEC RISE
| |
AMR CORP ORDERS 40 JETS FROM AIRBUS AND BOEING
| |
U.S. LEADING INDEX FELL 1.0 PCT IN JANUARY | The U.S. index of leading indicators
fell a seasonally adjusted 1.0 pct in January after a revised
2.3 pct December gain, the Commerce Department said.
The department previously said the index rose 2.1 pct in
December.
The decline in January was the biggest for any month since
July, 1984, when the index fell 1.7 pct.
The January decrease left the index at 183.8 over its 1967
base of 100, and was led by a fall in contracts and orders for
plant and equipment.
A total of six of 10 indicators available for January
contributed to the decline.
Besides contracts and orders for plant and equipment, they
were building permits, manufacturers' new orders for consumer
goods, a change in sensitive materials prices, slower
deliveries from vendors and higher average weekly claims for
state unemployment insurance.
Four of 10 indicators were positive, including stock
prices, new business formation, average work week and money
supply.
The main factor for the December upward revision was new
business formation.
There was no revision in the 0.9 pct increase in the
leading indicators index for November.
The index of coincident indicators, which measures the
current economy, fell 0.1 pct in January after increases of 0.7
pct in December and 0.2 pct in November.
The index of lagging indicators, which measures past
economic activity, rose 0.5 pct in January after a decrease of
0.5 pct in December and an increase of 0.2 pct in November.
Reuter
|
BRAZIL FINANCE MINISTER MEETS FRENCH OFFICIALS | Brazilian Finance Minister Dilson Funaro
held separate meetings with French Finance Minister Edouard
Balladur and Bank of France Governor Jacques de Larosiere on
the second stage of a European mission to explain his country's
latest debt crisis, French officials said.
They declined to disclose details of the talks. Monetary
sources described them as a preliminary diplomatic effort to
see if France could help to negotiate financial concessions
sought by Brazil from Western banks, governments and official
lending agencies.
REUTER
|
BURLINGTON COAT FACTORY WAREHOUSE CORP <BCF> NET | Jan 31 end
Shr 1.40 dlrs vs 1.10 dlrs
Net 16.4 mln vs 12.9 mln
Revs 196.2 mln vs 157.5 mln
Reuter
|
COFFEE PRICE FALL SHORT TERM - DUTCH ROASTERS | This morning's sharp decline in coffee
prices, following the breakdown late last night of negotiations
in London to reintroduce International Coffee Organization,
ICO, quotas, will be short-lived, Dutch roasters said.
"The fall is a technical and emotional reaction to the
failure to agree on reintroduction of ICO export quotas, but it
will not be long before reality reasserts itself and prices
rise again," a spokesman for one of the major Dutch roasters
said.
"The fact is that while there are ample supplies of coffee
available at present, there is a shortage of quality," he said.
"Average prices fell to around 110 cents a lb following the
news of the breakdown but we expect them to move back again to
around 120 cents within a few weeks," the roaster added.
Dutch Coffee Roasters' Association secretary Jan de Vries
said although the roasters were disappointed at the failure of
consumer and producer ICO representatives to agree on quota
reintroduction, it was equally important that quotas be
reallocated on a more equitable basis.
"There is no absolute need for quotas at this moment because
the market is well balanced and we must not lose this
opportunity to renegotiate the coffee agreement," he said.
"There is still a lot of work to be done on a number of
clauses of the International Coffee Agreement and we would not
welcome quota reintroduction until we have a complete
renegotiation," de Vries added.
With this in mind, and with Dutch roasters claiming to have
fairly good forward cover, the buying strategy for the
foreseeable future would probably be to buy coffee on a
hand-to-mouth basis and on a sliding scale when market prices
were below 120 cents a lb, roasters said.
Reuter
|
GREENWOOD RESOURCES <GRRL> SELLS COMPANY STAKE | Greenwood Resources Inc said it has sold
its 4,300,000 common share majority holding in <New London Oil
Ltd> of London to an affiliate of <Guinness Peat Group PLC> of
London and an affiliate of <Sidro SA> of Belgium for a total of
1,700,0000 dlrs in cash.
The company said it will apply the proceeds of the sale to
support its line of credit and as part of a proposed debt
restructuring with Colorado National Bancshares <COLC> and
Greenwood shareholders.
It said it will retain a seat on the New London board.
Reuter
|
AMR <AMR> TO ACQUIRE 40 LONG-RANGE JET AIRCRAFT | AMR Corp's American Airlines said it
will buy 40 long-range jet aircraft to support international
expansion, including routes in the Caribbean.
Under one agreement, the airline said, it will acquire 15
Boeing Co <BA> 767-300 planes. Under a separate agreement,
American will acquire A-300-600 aircraft from <Airbus
Industrie>, a European consortium.
The company's announcement included no value for the order.
Published reports put the value of the aircraft order,
including engines, at 2.5 billion dlrs.
A total of 98 General Electric Co <GE> CF6-80C2 engines is
involved in the orders, American Airlines said.
The published reports valued the engines at five mln dlrs
each.
The company said it will acquire the planes and engines
using rental leases that can be terminated on relatively short
notice.
The arrangement allows the airline to acquire the planes
without adding to its debt, it explained.
The Boeing 767s, to be delivered from February 1988 to
October 1988, will be used on routes between the U.S. and
Europe, American said.
It said the Airbus A300s, scheduled for delivery from April
1988 through June 1989, will be assigned to the Caribbean,
where American has developed a major new hub at San Juan,
Puerto Rico.
Reuter
|
VDO UNIT AND THOMSON-CSF IN JOINT VENTURE | <VDO Luftfahrtgeraete Werk Adolf
Schindling GmbH>, 75 pct owned by autoparts maker <VDO Adolf
Schindling AG>, said it set up a joint venture with Thomson-CSF
<TCSF.PA> of France to produce liquid crystal displays.
It said in a statment that it held 20 pct of the new
company called Eurodisplay and Thomson-CSF the remaining 80
pct. Thomson owns the remaining 25 pct of VDO Luftfahrtgeraete.
The two companies have also agreed to pool their research
on development, construction and assembly of the systems, for
use in vehicles and aircraft, with General Electric Company
<GEN> of the U.S.
Reuter
|
F.W. WOOLWORTH CO 4TH QTR SHR 1.78 DLRS VS 1.64 DLRS
| |
HEINZ INTERESTED IN BUYING GUINNESS BREWING | H.J. Heinz <HNZ.N> chairman Tony O'Reilly
would be interested in buying Guinness PLC <GUIN.L>'s brewery
division if it were for sale, a spokesman said.
The spokesman, reacting to Irish and British press reports,
said "He continues to be interested were the group to offer the
brewery side of Guinness for sale. But he has not put together
a consortium, nor has he been buying shares."
He was quoted by the Irish magazine Business and Finance as
saying he would be interested if it came on the market and that
he had the support of two international banks if he decided
such a purchase might be worthwhile.
In the magazine article, he suggested that if brewing
profits were calculated to be in the region of 80 mln punts,
the asking price would not be higher than 800 mln punts.
"A multiple of ten times earnings would be the top whack for
the brewing division in the current Guinness situation," he
said.
"This would mean an expensive exercise, right on the edge,
but not impossible," he added.
The deal would mean buying the Dublin, London, Nigerian and
Malaysian breweries because "It could only be sold as an
integral unit if it was going to be sold at all," O'Reilly said.
Reuter
|
EQUATORIAL COMMUNICATIONS <EQUA> TO HAVE LOSSES | Equatorial Communications
Co said it expects to report losses of about 57 mln dlrs for
the fourth quarter and 68 mln dlrs for the full year 1986 on
revenues of about 10 mln dlrs for the quarter and 52 mln dlrs
for the year.
Equatorial said the losses will include a charge of about
45 mln dlrs from costs associated with the restructuring of its
business, including adjustments to reflect the market value of
transponders owned and leased by Equatorial and other reserves
for inventory, receivables and excess facilities.
Equatorial said the fourth quarter operating results will
also include restructuring costs of about 5,500,000 dlrs, in
addition to the 45 mln dlr charge.
Equitorial also said that as of March One it is operating
in technical default under its lease of transponders on the
Galaxy III satellite due to its inabiliuty to maintain
agreed-upon financial ratios. It said it is in talks with the
lessors in an attempt to restructure lease obligations.
Further, Equitorial said it is in default of two other
oblitations in connection with the purchase or lease of
transponders as a result of cross-default provisions.
Equatorial said it has signed a memorandum of understanding
for Contel Corp <CTC> to purchase 10 mln dlrs of Equatorial
master earth stations, micro earth stations and associated
equipment and loan Equatorial six mln dlrs over a six-month
period for repayment starting in December 1988.
The company said Conteol, under the agreement, would assume
a portion of Equatorial's rights and obligations under the
Galaxy III transponder lease with <Burnham Leasing> on the
occurrence of certain events.
Equatorial said it would grant Contel an option to buy
about 3,600,000 common shares at 3.25 dlrs each.
Equatorial said its understandings with Contel are subject
to Equatorial's ability to restructure a significant portion of
its obligations and to obtain concessions from lenders and
lessors, in particular under its Galaxy III transponder lease.
It said it hopes to finalize a Contel agreement by April 15.
Equatorial in 1985 earned 1,807,000 dlrs after a 3,197,000
dlr gain from early debt retirement on revenues of 56.1 mln
dlrs. For the first nine months of 1986, the company lost
9,476,000 dlrs on revenues of 45.4 mln dlrs, compared with a
1,784,000 dlr profit after the early retirement gain on
revenues of 38.5 mln dlrs.
Reuter
|
TRANSAMERICA <TA> TO HAVE AUSTRALIAN SALE GAIN | Transamerica Corp said it will have
an after-tax gain of about 10 mln U.S. dlrs on the sale of its
Occidental Life Insurance Co of Australia Ltd affiliate to
<Pratt and Co Financial Services Pty Ltd> of Melbourne for 105
mln Australian dlrs.
The sale was announced earlier today in Australia. Proceeds
will be used to enhance the growth of North American operations
of its Transamerica Occidental Life subsidiary, the company
said.
Reuter
|
VIACOM INTERNATIONAL INC GETS ANOTHER NEW NATIONAL AMUSEMENTS BID
| |
F.W. WOOLWORTH CO <Z> 4TH QTR JAN 31 NET | Shr 1.78 dlrs vs 1.64 dlrs
Net 117 mln vs 106 mln
Sales 2.02 billion vs 1.85 billion
Avg shrs 65.6 mln vs 63.9 mln
Year
Shr 3.25 dlrs vs 2.75 dlrs
Net 214 mln vs 177 mln
Sales 6.50 billion vs 5.96 billion
Avg shrs 65.6 mln vs 63.9 mln
NOTE: Share data restated to reflect two for one stock
split in May 1986
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GM <GM> CUTTING SALARIED MERIT RAISES | General Motors Corp told employees it
was reducing the funds available for merit-raises for 109,000
salaried workers.
GM, which has been taking wide-ranging steps to cut costs,
said in a letter it cut the amount available for raises to 3.5
pct of the payroll from 5.5 pct in 1986.
The letter also said raises will be given in one annual
lump-sum payment from April rather than being folded into
salaries and thus increasing the base for benefit payments.
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BP OIL RAISES OPERATING PROFIT | <BP Oil Ltd>, the U.K. Marketing and
refining arm of British Petroleum Co Plc <BP.L>, raised its
pretax operating profit on a replacement cost basis to 182 mln
stg in calendar 1986, compared with 66 mln stg in 1985.
Sales and operating revenue fell to 3.1 billion stg from
4.2 billion on a replacement cost basis. Historical cost
operating profit was 61 mln stg, up from 16 mln.
BP Oil said 1985 profits had been depressed by exceptional
items. Its profit figures were stated before interest charges.
Chief executive David Kendall said improved results
mirrored benefits of a restructuring program undertaken in
recent years.
However, he warned future financial pressure on the
industry will be severe.
"The U.K. Oil marketing and refining industry will need to
invest larger sums - probably around 500 mln stg a year - for a
good many years," he said in a statement.
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CANADA PRICES 1.2 BILLION DLR BOND ISSUE | The finance department announced the new
1.2 billion dlr, four-part bond issue, to be dated March 15 and
delivered March 16, will be priced as follows.
- 8 pct bonds due July 1, 1990 at a price of 100.30 pct
todmpB]w about 7.89 pct to maturity
- 8-1/4 pct bonds due March 1, 1994 at a price of 100.25
pct to yield about 8.20 pct to maturity.
- 8-1/4 pct bonds due March 1, 1997 at a price of 99.50 pct
to yield about 8.32 pct to maturity.
- 8-1/2 pct bonds due June 1, 2011 at a price of 98.625 pct
to yield about 8.63 pct to maturity.
The 2011 maturity will be issued to a maximum of 375 mln
dlrs.
The Bank of Canada will buy 100 mln dlrs of the new issue,
including a minimum of 10 mln dlrs of the 2011 maturity.
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EARTHQUAKES CONTINUE IN NORTHERN NEW ZEALAND | Earthquakes and aftershocks are still
shaking areas of northern New Zealand following yesterday's
strong tremor which left 3,000 people homeless.
Four earthquakes measuring up to 4.5 on the Richter scale
have hit the Bay of Plenty and Waikato region in the north-east
since midnight yesterday (1200 GMT).
No casualties have been reported and no further major
damage, civil defence sources said.
A government seismologist said from Rotorua in the North
Island some five tremors were being recorded every 10 minutes.
The seismologist said if the pattern of other large
earthquakes was followed the shocks would continue for one to
several weeks, declining in frequency and magnitude. But the
chance of a further large shock could not be ruled out.
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U.S. ASKS JAPAN END AGRICULTURE IMPORT CONTROLS | The U.S. Wants Japan to eliminate import
controls on agricultural products within three years, visiting
U.S. Under-Secretary of State for Economic Affairs Allen Wallis
told Eishiro Saito, Chairman of the Federation of Economic
Organisations (Keidanren), a spokesman for Keidanren said.
The spokesman quoted Wallis as saying drastic measures
would be needed to stave off protectionist legislation by
Congress.
Wallis, who is attending a sub-cabinet-level bilateral
trade meeting, made the remark yesterday in talks with Saito.
Wallis was quoted as saying the Reagan Administration wants
Japanese cooperation so the White House can ensure any U.S.
Trade bill is a moderate one, rather than containing
retaliatory measures or antagonising any particular country.
He was also quoted as saying the U.S. Would be pleased were
Japan to halve restrictions on agricultural imports within five
years if the country cannot cope with abolition within three,
the spokesman said.
Japan currently restricts imports of 22 agricultural
products. A ban on rice imports triggered recent U.S.
Complaints about Japan's agricultural policy.
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U.S. FINANCIAL ANALYSTS - March 3 | New York
Sarich Technologies Trust - New York
Health Management Associates - New York
Reuter
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FIRSTCORP <FCR> SEES GAIN ON CONDEMNATION | Firstcorp Inc said it weill report
an after-tax gain of 1,827,000 dlrs or 56 cts per share primary
and 42 cts fully diluted from the proposed condemnation and
acquisition of a parking deck it operates by Wake County.
The company said if it reinvested proceeds in a similar
property within 24 months, the gain on the sale would be
deferred for tax purposes.
Reuter
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ASHTON-TATE <TATE> TO OFFER COMMON SHARES | Ashton-Tate said it intends to
file for an offering of about two mln shares within the next 30
days.
It said proceeds would be used for working capital and
other general corporate purposes, including the possible
acquisition of other businesses or additional technology.
Ashton-Tate now has about 23.6 mln shares outstanding.
Reuter
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KEYCORP <KEY> REGISTERS SUBORDINATED NOTES | KeyCorp said it has filed with the
Securities and Exchange Commission for the offering of 75 mln
dlrs of subordinated capital notes due March 1, 1999.
The company said it is anticipated the notes will be
offered this week through underwriters led by First Boston
Corp.
Proceeds will be used for general corporate purposes,
including the acquisition of <Seattle Trust and Savings Bank>,
which is scheduled for July one, KeyCorp said.
Reuter
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<NATIONAL SEA PRODUCTS LTD> 4TH QTR NET | Oper shr 43 cts vs 21 cts
Oper net 6,846,000 vs 3,386,000
Revs 137.1 mln vs 107.6 mln
Year
Oper shr 1.36 dlrs vs 42 cts
Oper net 21,764,000 vs 7,239,000
Revs 516.4 mln vs 454.7 mln
Note: 1986 qtr excludes extraordinary gain of 784,000 dlrs
or five cts share, versus extraordinary loss of 110,000 dlrs or
shr nil in 1985 qtr
Note continued: 1986 year excludes extraordinary gain of
14,360,000 dlrs or 94 cts share, versus extraordinary gain of
2,883,000 dlrs or 19 cts share in prior year
Reuter
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U.K. MONEY MARKET SHORTAGE FORECAST REVISED DOWN | The Bank of England said it had revised
its forecast of the shortage in the money market down to 450
mln stg before taking account of its morning operations. At
noon the bank had estimated the shortfall at 500 mln stg.
REUTER
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NATIONAL AMUSEMENTS AGAIN UPS VIACOM <VIA> BID | Viacom International Inc said <National
Amusements Inc> has again raised the value of its offer for
Viacom's publicly held stock.
The company said the special committee of its board plans
to meet later today to consider this offer and the one
submitted March one by <MCV Holdings Inc>.
A spokeswoman was unable to say if the committee met as
planned yesterday.
Viacom said National Amusements' Arsenal Holdings Inc
subsidiary has raised the amount of cash it is offering for
each Viacom share by 75 cts to 42.75 dlrs while the value of
the fraction of a share of exchangeable Arsenal Holdings
preferred to be included was raised 25 cts to 7.75 dlrs.
National Amusements already owns 19.6 pct of Viacom's stock.
Reuter
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