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Friday newspaper round-up: British Energy, Barratt Developments, BAE Systems

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Date: Friday 11 Apr 2008

LONDON (ShareCast) - Electricité de France is drawing up plans for a full offer for British Energy of more than 700p per share as the deadline for formal bids draws closer.

EDF is vying for control with the German power giant RWE, which informally submitted an indicative all-cash offer of nearly 700p per share several weeks ago, valuing it at £11bn, writes the Times.

Pressure is growing on the Bank of England to take drastic measures to ease the credit crunch after yesterday's quarter-point interest rate cut failed to make any inroads into the crisis. Three month inter-bank lending rate futures were effectively unmoved while two mortgage lenders increased their fixed rate deals despite the Bank's 25 basis point cut in rates to 5%, reports the Telegraph.

A cut in interest rates from the Bank of England will do little to help revive Britain's commercial property market. According to property agent Savills, activity in the UK commercial property market tumbled 16% last month as economic growth slows and the credit crunch makes money more expensive to borrow, reports the Telegraph.

Barratt, one of the UK’s biggest housebuilders, is considering the sale of its commercial property division in order to reduce the debt incurred in the £2.2bn ($4.3bn) acquisition of Wilson Bowden last year. The housebuilder is hoping to secure more than £250m for Wilson Bowden Developments, reports the FT.

Guardian Media Group chief executive Carolyn McCall has resigned from the Tesco board amidst the escalating battle between the publisher and the supermarket giant. McCall yesterday surrendered her non-executive director position, acknowledging the conflict of interest plaguing the role since Tesco's move to sue The Guardian newspaper for "libel and malicious falsehood", reports the Telegraph.

The decision by ministers and the Serious Fraud Office to halt an investigation into alleged corruption in the BAE Systems arms deal with Saudi Arabia was unlawful, an “abject surrender” and a threat to the reputation of British justice, the High Court ruled yesterday. In one of the most strongly worded judicial attacks on government action, judges condemned how ministers “buckled” to “blatant threats” that Saudi cooperation in the fight against terror would end unless the bribery investigation was dropped, reports the Times.

JP Garnier, the head of GlaxoSmithKline, who has had a fraught relationship with investors over his pay, will bow out of the pharmaceutical giant on a sour note after being granted options that could entitle him to be paid up to £2.5 million long after his retirement. It emerged yesterday that Dr Garnier, who will retire next month, was granted share options last year after saying in 2006 that he planned to retire, says the Times.

Sir Philip Green threw down the gauntlet to his high street rivals yesterday by vowing that Topshop and Topman would have a “record year” despite the toughest trading climate he can remember, writes the Times.

Shares in Econergy International, the AIM-listed wind farm developer, spiked yesterday after Vincent Tchenguiz said he may buy the company. Consensus Business Group, Tchenguiz's investment fund, said it was considering one of three courses of action in relation to its 18% holding in the company: sell it, make a bid for the entire group, and make a bid for certain assets, reports the Independent.