Today’s Newspapers: The Times, Independent, FT, Telegraph, Guardian, Mail, Express, Herald 110516

The Times

White knight bids boost hopes for rescue of BHS: Hopes were rising that a white knight investor will save British Home Stores after five bidders submitted offers for the bulk of the failed retailer before the final deadline.

Woeful trade sends deficit to its worst since 2008: A slight improvement in Britain’s woeful trade position in March did little to raise hopes for growth as the deficit slumped to its worst for a calendar quarter since the start of the financial crisis.

EasyJet’s dividends climb despite losses: The Founder of easyJet has won his six-year battle to get the short-haul airline to pay out dividends equal to half of its annual after-tax profits.

Office development hits new high in City despite Brexit fears: The rate at which new offices are being developed in Central London has risen sharply, suggesting that uncertainty regarding the EU referendum next month has not had as large an impact on commercial building as feared.

Economists savour rise in China pork price: A jump in the price of pork helped to keep Chinese consumer inflation steady last month, while factory deflation fell less than expected in a welcome sign for the world’s second-largest economy.

The Independent

NIESR warns of Brexit ‘shock’ to U.K. economy: The U.K. economy would experience a “significant shock” if it left the European Union, the respected National Institute of Economic and Social Research has said.

BP signed contracts with Unaoil after it was linked to bribery scandal, Panama Papers reveal: BP hired Unaoil, a Monaco-based company, to carry out work in Iraq a year after it was linked to a corruption case, according to the Panama Papers.

The man who predicted the oil price crash has bet against Saudi Arabia: Zach Schreiber, a hedge fund CEO, correctly predicted the oil price crash in 2014, reportedly earning $1 billion (£700,000) in profit for his firm.

Financial Times

Russian gang suspected of scam in ICE market: Intercontinental Exchange’s London futures market has been used as a front for Russian organised crime, according to police who have made two arrests for suspected money-laundering.

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Hotel Chocolat soars 28% to sweeten London IPO market: Hotel Chocolat, a high-end chocolatier, has provided a sugar rush for the flagging London initial public offering market with its shares soaring 28% on the company’s debut.

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Liberty Global open to takeover of Telefonica’s O2 unit: Liberty Global would consider a takeover of Telefonica’s O2 in the U.K. as a long-running deal to sell the business to Hong Kong’s CK Hutchison moves closer to being blocked by Brussels antitrust regulators.

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BHP to expand copper and oil exploration despite weak prices: BHP Billiton is expanding its oil and copper exploration programme as the world’s largest miner by market capitalisation seeks to lay the foundations for renewed growth after the commodities rout.

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Capita boosted by new contracts: Shares in Capita jumped 6% on Tuesday, the biggest one-day jump for the British outsourcing company in more than a year, as it revealed it had won new contracts.

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ABF weighs sale of Chinese sugar business: Associated British Foods is looking to sell its lossmaking sugar business in China to focus on its sugar operations in Europe and Africa.

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Dell seeks to raise $16 billion in bond sale: A surge of corporate bond sales has drawn U.S. computer maker Dell out of the dark, as the group seeks to tap investors during a receptive period and sew up the financing for its $63 billion takeover of EMC.

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ThyssenKrupp cuts forecasts as steel glut weighs on prices: ThyssenKrupp cut its full-year earnings target on Tuesday, warning that a fall in the price of materials had been “sharper and longer-lasting than expected”.

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Nokia sales slide 9% in first quarter: Sales at Nokia slumped 9% in the first quarter following its acquisition of Alcatel-Lucent, as the Finnish telecoms equipment group warned about challenging conditions in its core mobile telecoms market.

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Staples tie-up with Office Depot halted by U.S. regulators: Staples and Office Depot became the latest victims of U.S. regulators, as the two largest stationery retailers in America decided to scrap their $6.3 billion merger after a U.S. court said it would hurt their corporate customers.

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Lex:

Allergan: kicking the habit: For Allergan, the temptation to return to the acquisition trail is strong but that would be like taking up smoking again. Nicotine patches, in the form of share buybacks, are preferable.

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Credit Suisse: not down for the count: Dazed and bloody, Credit Suisse shareholders keep heaving themselves up off the canvas. After two-fifths of their value was bashed out of them over the past year, shares in the Swiss lender rose by 5% on Tuesday after results from 2016’s first round came were marginally less bruising than feared.

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Capita: back-office job: Nothing appals a Capita shareholder like comparing it with Serco or G4S, two outsourcers that are bywords for reputational risk, and not for making much profit.

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Lombard:

Saudi Aramco — more mirage than IPO: The Saudis have not entirely got the hang of this initial public offering caper. If a U.S. or U.K. private equity group owned Saudi Aramco, it would be cutting capital expenditure to flatter profits ahead of the float.

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Politics of payout ratios: Over the years, Sir Stelios Haji-Ioannou has campaigned for higher dividends from easyJet with the passion others devote to ornithology or model trains.

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The Daily Telegraph

Eurozone recovery wilts as sugar rush fades, deflation lurks: The Eurozone’s short-lived recovery is already losing steam as stimulus fades and deep problems resurface, raising fears of yet another false dawn and a potential deflation trap if there is any external shock over coming months.

Bidders from around world circling Tata’s U.K. steel business: Bidders from around the world as well as Britain are circling Tata’s loss-making U.K. steel business, with the sector ripe for consolidation according to Bosses at German steelmaker ThyssenKrupp.

Disney misses Wall Street estimates despite Star Wars success: Walt Disney has missed Wall Street estimates for the first time in five years after slowing growth at its sports network, ESPN dragged sales lower despite the success of its blockbuster films Star Wars and Zootropolis.

ISS backs rebel investor at Stock Spirits: One of the City’s most influential shareholder advisory groups has recommended investors back an activist’s campaign to shake-up the board of Stock Spirits, dealing a blow to the embattled vodka distiller.

Channel 4 execs get pay rises as audiences and ad sales grow: Channel 4 Executives were paid close to the maximum allowed last year after the broadcaster enjoyed record sales in a buoyant television advertising market.

Britain gets no power from coal for ‘first time on record’: Britain generated no electricity from coal on Tuesday morning for what is believed to be the first time since the 19th century, in a major milestone in the decline of the polluting power source.

Nissan unveils new power system where electric cars feed energy back into the grid: Nissan has revealed a vision of the future where batteries in its electric vehicles are used to power motorists’ homes and offices. The company is launching a pilot programme in the U.K. where 100 of its Leaf electric cars can be plugged into the power network and energy in their batteries fed into the U.K. power system.

The Questor Column:

Are the best days behind easyJet shares?: EasyJet investors cheered the increase in dividend payments to 50% of profits sending the shares more than 2% higher . However, the £24 million loss for the first-half showed worrying signs that an airline industry space race is impacting pricing. Carolyn McCall, Chief Executive, said demand for beach holidays was strong, and she was confident revenues and profits would increase during the full-year. Market expectations are for full-year revenue to rise by £180 million to £4.87 billion, and pretax profits to rise by £33 million to £719 million. However, these results show clear signs of how the huge capacity expansion amongst the airlines is weighing on trading. EasyJet said it carried 31 million passengers in the first-half, 2.1 million more or 7% higher than the same stage a year earlier. If consumer demand doesn’t grow at the same rate as the expansion then the airlines will have to cut prices to get bums on seats. EasyJet is already doing this with revenue per seat down 6.6% to £51.29 in the first half. The falling seat prices haven’t hit profits too hard because the blow has been cushioned by falling jet fuel prices. EasyJet said total costs per seat were down 5% in the first-half. EasyJet said that based on jet fuel costs and exchange rates remaining at their current levels, the company could see the fuel bill reduced by up to £180 million for the full year. So, the collapse in jet fuel prices has bought easyJet some time and room for manoeuvre, but it is important for long term investors to step back. The airline has a healthy net cash balance of almost £300 million on the balance sheet at the end of March and can easily afford the increase in dividends to 50% of after tax profits. With clear signs of a highly competitive European budget flight market in the summer ahead, we’d sell before the shares hit turbulence. EasyJet at £15.10+40p. Questor says “Sell”.

The Guardian

EU referendum: top economic thinktank warns of post-Brexit shocks: The pound would plunge 20% immediately after a Brexit vote in June, according to a leading economic thinktank.

Gordon Brown urges EU states to unite against tax havens: Gordon Brown has called on Europe to impose collective sanctions on tax havens in a bid to halt the drain of revenue to secretive offshore destinations and to demonstrate to left-leaning voters the progressive case for remaining in the EU.

Brexit ‘unlikely to mean deep migration cuts but may lead to 2p tax increase’: It will be “extremely difficult” to deliver deep cuts in immigration if Britain leaves the European Union, a leading British economist has warned.

Top 25 hedge fund Managers earned $13 billion in 2015 – more than some nations: The world’s top 25 hedge fund Managers earned $13 billion last year – more than the entire economies of Namibia, the Bahamas or Nicaragua.

Amazon jumps the price gun as Morrisons staples go online early: Amazon is poised to start selling fresh groceries including staples such as milk and bananas on the back of its tie-up with supermarket chain Morrisons.

House price rises see buy-to-let returns outstrip FTSE 100: Landlords in England and Wales made average returns of 9.6% on buy-to-let properties in the year to the end of March, and 16.5% if they bought in London – better than almost any other major class of investment.

Daily Mail

Britain staring into a £309 billion pension black hole with eight in ten final salary schemes in in deficit: Eight in ten final salary pension schemes in Britain are in deficit with a total shortfall of more than £300billion.

Britain’s trade deficit hits eight-year high ahead of EU referendum as imports of cars, clothing and footwear rise: Britain’s trade gap widened in the first three months of the year to its biggest disparity since the financial crisis, adding to a spate of data showing that the U.K. economy has stalled ahead of the upcoming EU referendum.

Channel 4 ‘escapes privatisation’ after Downing Street intervention as BAFTA-winning First Dates broadcaster posts record £979 million revenues: Googlebox and BAFTA-winning First Dates broadcaster Channel 4 saw its revenues rise to a record £979 million last year, up from £938 million a year earlier.

Daily Express

Treasury blasted by top economist for ‘flawed’ Brexit report that ‘treats us like fools’: The Treasury’s report on the financial impact of leaving the Brexit is dishonest, condescending and designed to terrify people into voting to stay, according to one of the country’s top economists.

Pension ‘time bomb’: Warning for savers who only make minimum contribution to their pots: Workplace pension savers who only make the minimum contribution to their pots could be sitting on a “ticking time bomb”, former pensions Minister Steve Webb has warned.

Red-hot HMV closing gap on rivals Amazon: HMV has reclaimed its position as Britain’s second-biggest entertainment retailer. The news comes as bricks and mortar music stores buck the wider high street gloom by taking business from online rivals.

The Scottish Herald

Majority of small firms opposed to second independence referendum within five years finds survey: A majority of small firms feel Scotland shouldn’t hold a second independence referendum in the next five years a survey has found.

Scottish distillers celebrate Asda supply deals: Edinburgh Gin, Valt Vodka and Scotch whisky distiller Tullibardine are toasting supply deals with supermarket group Asda worth at least £300,000-a-year in total.

Mars bars to be made with Scottish wind power: The maker of Mars bars and Snickers has announced a partnership with energy provider Eneco U.K. to power its 12 U.K. factories with electricity generated from the new, 20-turbine Moy Wind Farm, located just south of Inverness.

Holoxica hails brain hologram as breakthrough for neuroscience: A hologram said to be the first of its kind in the world showing connections in the human brain has been produced by Edinburgh-based holographic imaging specialist Holoxica.

Scottish packaging group Macfarlane confident on continued business growth: Peter Atkinson, the Chief Executive of Glasgow-based Macfarlane Group, said the packaging business was poised to make its third acquisition this year as it continues its strategy of consolidating the fragmented U.K. marketplace.

Emirates enjoys surge in profits: Dubai-based airline group Emirates said its full-year profit jumped 50% to 8.2 billion Emirati dirham (£1.5 billion) compared with a year ago, after boosting passengers by 8% to a record 51.9 million, although its seat factor – a measure of how full its planes are – fell by 3.1% to 76.5% over the period.

Almost £3.5 million added to Aggreko incentive plan: CHRIS Weston, the Chief Executive of Glasgow-based mobile power generator specialist Aggreko, has been awarded an additional £2.2 million of shares under the company’s long term incentive plan.

Highland fish supplier wins high end London business with bank support: A Highland firm which supplies fish to the famed Gordon Ramsay restaurants group in London has revealed it increased turnover by around 60% after securing growth funding from HSBC.

The Scotsman

Glasgow studio wades into battle with Warhammer trailer: A Glasgow animation studio that has worked on some of the biggest video game franchises has unveiled its trailer for the latest instalment in the Warhammer saga.

Medical tech start-up wins free space at incubator: An entrepreneurial physiotherapist has won six months’ free tenancy at Lanarkshire life sciences incubator MediCity Scotland.

Creative agency trio look to future with new venture: Three digital agency Directors have joined forces to form a new practice with offices in Edinburgh and London.

Scottish postal services acquired by parcels outfit DX: Parcels delivery operator DX is to buy two Scottish postal services for £3.25 million in cash.

City A.M.

China outbound M&A climbs to record highs: Outbound merger and acquisition (M&A) activity in China has rocketed so far in 2016. The country has become the world leader in cross-border acquisitions, overtaking the U.S. and Canada for the first time on record, according to data from Dealogic.

Costs forcing millions to move back with parents after a break-up: Financial pressures have been blamed for forcing 7.2 million adults to move back in with their parents after a break-up. Rising rent and mortgage costs mean many are unable to pay for separate accommodation, according to research from Churchill Home Insurance out.

Sales surge pushes Botox maker Allergan to a $10 billion share buyback: Dublin-based Botox maker Allergan has announced it will buy back $10 billion (£6.2 billion) of shares after swinging into a profit for its first quarter.

Russian oil Boss Sechin declares Opec effectively extinct: The head of Russia’s biggest oil firm declared the Organisation of Petroleum Exporting Countries (Opec) extinct. Igor Sechin, a close ally of Russian President Vladimir Putin, told Reuters that internal strife is killing the cartel and its ability to steer the oil market has all but evaporated.

Saudi Aramco says it’s likely to ramp up production to meet rising demand: Saudi Aramco is likely to ramp up oil production to meet rising demand, at a time when global oil markets are already awash with crude.

Star Wars game helps boost Electronic Arts’ sales and earnings: Shares in video games maker Electronic Arts (EA) shot up by over seven% in after-hours trading, after the U.S. firm revealed quarterly revenue and profit had come in ahead of analysts’ expectations.

ITN Boss calls for more BBC outsourcing ahead of crunch white paper: The BBC should use its “incredible position as a buying power” to boost outside TV production companies, the head of ITN has said.

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