Editor: John Arnold. E-mail jarnold@creditman.co.uk
Pat Williams. E-mail pwilliams@creditman.co.uk
Site: Business Credit Management UK
URL: http://www.creditman.co.uk
Issue: Vol 5 Issue 47
Dated: 16 December 2001
Welcome to the Business Credit News UK.
In this weeks edition you will find the following topics.
UKUK BUSINESSES GIVE A CLEAR THUMBS DOWN TO THE EURO AND THE SINGLE MARKET
Other European countries warm to the concept of the single currency but UK still lags behind
With less than a month to go until the introduction of the euro notes and coins, new research from business and financial advisers, Grant Thornton, reveals that the chasm between UK businesses and their European counterparts is growing wider.
Now in its 10th year, The European Business Survey (EBS) 2002 shows that SMEs across Europe are increasingly positive about the introduction of the euro, with 73% of companies based in EU countries saying it will have a beneficial impact.
However, UK SMEs are not so sure that the single currency will benefit them. EBS 2002 shows that around half think it will have a negative impact and 14% believe it will have no effect on their business at all. This result places the UK firmly at the bottom of the table for euro confidence in what is the least confident EU- wide result in the last four years of the EBS.
Andrew Godfrey, Grant Thornton's head of international and European services comments, "With so much political spin surrounding the euro issue, businesses have been left confused by its implications. UK businesses need to address this issue as a matter of urgency. Any UK business trading with a country dealing in the euro will have to adapt its business processes to deal with the conversion. Firms must act now to ensure euro preparedness.
"For instance, the Eurozone is a huge trading area and businesses must be prepared to sell and actively market their goods in euros to remain competitive. Retailers in tourist destinations will also need to make sure their staff and systems can cope if people try to pay in the new currency."
UK SMEs steadfastly resists changing attitudes
EBS 2002 demonstrates just how pronounced the differences between the UK and Europe have become. Of the three EU countries which have resisted the euro thus far (Denmark, Sweden and the UK), the mood of business in Denmark and Sweden is increasingly more receptive than in the UK. In sharp contrast to last September's public referendum on the issue in Denmark, when a resounding "no" vote was returned, when asked in the survey whether they would like their country to adopt the euro, 85% of Danish businesses said they would. The result was even more decisive in Sweden where 86% were in favour of joining.
Interestingly, when the groundswell of popular opinion in Scandinavia is contrasted with the current mood of UK businesses, a very different picture emerges. When asked whether they would like to adopt the euro, only 37% of UK SMEs say they are in favour of the UK joining the single currency.
UK sees the "single market" as adding to red tape burden
The EBS has been undertaken for the last 10 years and it is therefore possible to compare and contrast the views and ambitions of SMEs in the EU from the beginning of the single market to the present day.
Whilst many European countries see the single market as having opened up easier routes for expansion, distribution and marketing, there are frustrations across the board. Once again, the UK seems to be the country which believes it will be burdened with more red tape than any other, with almost 50% seeing an increase in the administrative burden as a result of the single market, compared to an EU average of 31%.
Andrew Godfrey concludes, "This research shows just how far behind the rest of Europe UK businesses are in their attitude to European union.
"With more than half of Britain's largest retailers preparing to accept euro notes and coins from January 1, it is obvious that the changes will affect all of us.
"Regardless of the pros and cons of the UK joining the euro, these figures clearly show that UK SMEs need clear leadership as to what it means for them. What UK plc needs is for The Government to act now and spark a public debate on the UK's possible entry to the Eurozone."
SMALL FIRMS RAISE CONCERNS OVER MORE EMPLOYMENT REGULATIONS
Reacting to the Government’s consultation on ‘Towards Equality and Diversity: Implementing Employment and Race Directives’, which begins today (Thursday), the British Chambers of Commerce raised concerns that this will lead to more employment legislation and that it was critical for government to ensure business involvement in any decision making process.
David Lennan, director general of the British Chambers of Commerce said:
“Businesses would agree that it is important that no one feels excluded from our workforce. However, the proposals out today will be seen as yet one more addition to the large stock of employment regulations that small businesses must face.
“Potentially, the proposals on age discrimination could be opening up a hornet's nest, with significant implications for retirement, redundancy and reward policies in the UK. If the ultimate regulations are not to be seen as a burden on firms, it is important that they are implemented with full business input.
“The long lead-in time the Government negotiated on the underlying EU directive is helpful in that respect. I would urge businesses to get involved at this early stage and make the most of the consultation process.”
SMALL BUSINESSES OFFERED MAKEOVER TO ATTRACT BIG BUSINESS INVESTORS
David Irwin invites bids for pilot programmes
Small firms looking for big financial backers could soon get the makeover they need to attract the right investor following the launch of a new Small Business Service bidding round announced last week.
Organisations can now bid for funding to develop pilot projects that will look at the best ways of setting up 'business salons'. The funding will be taken from the £180 million Enterprise Fund established in 1998. By addressing the issue of why small businesses find it hard to take advantage of the various equity capital schemes currently available it is hoped more small firms will get the investment they need to grow and prosper.
Pilot projects will use workshops, diagnostic reviews and "investment grooming" sessions. Help will be tailored to the needs of geographical areas and individual businesses, and the most successful models are likely to be rolled out to a wider audience.
Head of the Small Business Service David Irwin said:
"In the last few years there has been a huge growth in the supply of risk capital to small firms. But it is clear that many small businesses with growth potential are missing out on these opportunities because they do not know how to turn their business proposals into attractive investment propositions.
"The SBS is looking to bridge that gap by supporting a small number of pilot projects aimed at testing the best ways to improve SMEs' investment readiness. This means that in time, these opportunities will become available to a much wider range of small firms."
A recent Canadian study of investors highlighted the main reasons why small businesses fail to find investors. These include:
Copies of the bidding guidance can be obtained from Bill Barrott, SBS Investment Directorate, St Mary's House, C/o Moorfoot, Sheffield S1 4PQ, Tel: 0114 259 7325, email Bill.Barrot@SBS.gsi.gov.uk
The guidance can also be accessed through the following websites: www.businessadviceonline.org and www.sbs.gov.uk
A consultation exercise was held earlier this year, and identified a variety of potential approaches to helping SMEs become investment ready.
The closing date for bids is 31 January 2002.
NEW CONSTRUCTION ORDERS: OCTOBER 2001
Orders in the year to October 2001 rose by one per cent compared to the previous year and orders in the three months to October 2001 rose by four per cent compared to the same three month period a year earlier. Orders in the three months to October 2001 rose by nine per cent compared to the previous three months, with rises in the infrastructure, private commercial and public and private housing sectors more than offsetting falls in the remaining sectors.
Private housing orders in the three months to October 2001 rose by seven per cent compared with the previous three months and by seven per cent compared with the same three month period a year ago. Orders in the year to October 2001 fell by six per cent. Public housing and housing association orders in the three months to October 2001 rose by 18 per cent compared to the previous three months, and by nine per cent compared to the same three month period a year earlier. Public housing and housing association orders in the year to October 2001 rose by 17 per cent when compared to the previous twelve month period. All comparisons in this sector are affected by large variations due to its relatively small size.
Infrastructure orders in the three months to October 2001 were 36 per cent higher compared with the previous three months, and were nine per cent higher than in the same three month period a year earlier. Orders in the year to October 2001 rose by four per cent compared with the previous twelve month period.
Public non-housing orders (excluding infrastructure) in the three months to October 2001 were three per cent lower compared with the previous three months, but were 34 per cent higher compared to the same three month period a year earlier. Orders in the twelve months to the three months to October 2001 were six per cent higher when compared with the previous twelve month period.
Private commercial orders in the three months to October 2001 were nine per cent higher compared to the previous three months, but seven per cent lower than in the same three month period a year earlier. This fall was mainly due to low levels of office orders. Orders in the twelve months to the three months to October 2001 were unchanged on the previous twelve month period. Private industrial orders in the three months to October 2001 were 16 per cent lower than in the previous three months, and one per cent lower compared to the same three month period a year earlier. Orders in the year to October 2001 rose by three per cent compared with the previous twelve month period.
UK TECHNOLOGY COMPANIES ARE STILL GROWING, BUT CASH DEMANDS REMAIN
UK technology companies are remaining bullish despite being hit hard by the economic slowdown, according to the latest findings of Ernst & Young HiTech Monitor survey.
Published today, the six monthly survey shows that technology companies have grown at an average rate of six per cent. Although this is considerably less than last year's corresponding quarter, the survey finds that businesses are succeeding in fighting the downturn and are generating growth.
Stuart Watson, technology partner in Ernst & Young's Entrepreneurial Services practice, says: "Significantly, it is small and medium sized businesses (with turnover under £60 million) that are prospering, showing a higher growth in the past quarter compared to larger companies. An increase in sales and an increase on the back of an expanding order book, along with sustained research and development, has enabled these companies to drive new business and develop new products, rather than wait for repeat or deferred orders."
However, this growth is coming at a price, with over three-quarters of small businesses spending more money than they are generating. Almost a third (30 per cent of respondents) named raising funds to grow their business as their top concern.
Watson emphasises: "Companies that continue to spend on R&D and invest in marketing their goods, while their competitors cut back, will be in pole position to respond when the general recovery occurs. However, smaller businesses need to find funding fast, as 67 per cent are not confident that their cash reserves will last for the next 12 months, and are unsure whether they will be able to raise further funds to maintain their competitive position.
"It is critical that technology companies predict the direction of their business more clearly, to ensure they survive through difficult times. However, companies are now finding it more difficult to read their markets compared to last year, making this a difficult task.
"Over the past six to nine months customers of most technology driven businesses are reducing the amount they are spending on products, and are only focusing on a small number of projects with a faster payback. This means that for technology companies whose sales propositions have a strong return on investment angle are closing new sales. Whereas, those who sell 'the next generation' type products are suffering delays and getting stuck in trials and pilots.
"In these cash constrained times research and development efforts are being heavily scrutinized and evaluated. There is a move for companies to focus on producing well understood platforms and products that can be used and sold now to well specified markets and customers, 'rather than 'next generation' products, which still require a large injection of research and development cash and which cannot be used by consumers for another two to three years. Some highly cherished and exciting projects are being delayed or put on ice and some hard decisions are being taken.
"For those companies that have deep pockets, now is a good time to hire skilled people or extract good deals from suppliers. However, even in such companies, cash burn is being looked at closely and projects are being tightly controlled.
"Technology companies must adapt their strategy to find a faster route to cash generation and should not rely on any single initiative, unless, of course, they are one of the many smaller venture capital backed companies, who may well have been funded solely for this purpose. Cash generation is the name of the game," says Jenkins.
The survey also shows that companies' funding expectations are now shifting from equity to debt and to smaller sums of money as they try to spread their debt.
"Funding is still available, but banks and Venture Capitalists (VCs) are no longer willing to take on the risk of an unproved investment. This puts smaller less mature companies in a vulnerable position, as they have fewer assets to use as security, says Watson.
"The technology sector has been out of favour on the public markets and with private equity providers for some time, making raising new capital very difficult for many companies, as interest in the sector lulled after a boom period of readily available capital. However, there are signs of confidence in the public markets with prices picking up a small portion of the major losses from the first three-quarters of the year, and some venture capital activity.
"The more desirable investments now favoured by banks & VCs have established revenue streams, stability and are free from complicated commitments from previous funding rounds, placing larger companies in a better position than their younger rivals."
The survey also shows that funding aims are less ambitious than last year and that 46 per cent of respondents were only looking for tranches of funding of less than £1 million. This was due to either a realistic view of the ability to raise significant funds, or the potential dilutive effect of a lower relative valuation on their business.
"As companies are trying to find alternative routes to obtain cash, companies with strong technological offerings may be forced to ally themselves with larger competitors to fulfill the potential of the technology. This consolidation activity is already happening in the sector to give companies sufficient financial and management strength to see them through the difficult times," concludes Mr Watson.
CHAMBERS REACT TO LATEST UNEMPLOYMENT FIGURES
Reacting to the latest labour market data released last Wednesday by the Office of National Statistics showing a rise in unemployment claimants in November, Ian Fletcher, Chief Economist at the British Chambers of Commerce said:
"These figures suggest the UK is escaping the worst of the world recession, although the chances are unemployment will rise further in the months ahead. The Bank of England must remain vigilant as the fear of unemployment could affect consumer confidence, which is the driving force in our economy at present.
“With inflation nailed to the floor at present there is plenty of scope for the Bank to cut interest rates further, if so required.”
MANUFACTURERS' ORDERS REMAIN BELOW NORMAL - CBI SURVEY
Manufacturers' domestic and export orders remained significantly below normal, according to the CBI's December monthly Industrial Trends Survey.
Fifty-five per cent of manufacturers say export order books are below normal and 12 per cent say they are above normal. The negative balance of minus 43 per cent is not as weak as November's balance of minus 50 per cent but remains similar to the figures recorded in September and October.
Total order books are significantly below normal and to a similar extent as reported in the three previous monthly surveys. Fifty per cent of firms say orders are below normal and sixteen per cent say they are above normal. This gives a negative balance of minus 34 per cent (-33 November).
Stocks of finished goods have risen to their highest level since November 1998. The balance of plus 26 per cent of firms reporting more than adequate stocks is now well above the long term average recorded in the survey.
The build-up of stocks has lead to output expectations being the most negative in a monthly survey since October 1998. Only 14 per cent of firms expect output to rise over the next four months while 42 per cent expect it to fall. This gives a negative balance of minus 28 which compares with minus 21 in November. The largest falls are expected in aerospace, mechanical engineering and motor vehicles.
Ian McCafferty, CBI Chief Economic Adviser, said: "Today's survey illustrates the length and depth of the recession in manufacturing. The outlook remains heavily influenced by the current global weakness and the UK manufacturing sector is not expected to recover until the latter half of 2002."
Manufacturers expect domestic prices to fall sharply over the next four months. The decline is at a similar rate indicated in the November survey, when expectations were the most negative since November 1998.
According to figures released by the Bank of England, UK consumer debt has topped over £700 billion for the first time with over 23,000 houses being repossessed by mortgage companies last year alone. The Citizens' Advice Bureau has also reported that consumer debt problems have increased by 39 per cent over the last four years. With the run up to Christmas, banks and other major lenders are already experiencing a significant increase in demand, particularly in respect of high street store cards. This week it has also been widely reported how families across the UK are trapped in a cycle of debt.
Ken Maynard, Managing Director of Cabot Financial, a market leading debt resolution company comments, "With consumer debt on an upward spiral, banks and major financial institutions face a major dilemma. In addition to seeking new ways to improve their collection performance, bank bosses are also under considerable pressure to retain their customers over the long-term. It is even more vital that banks now consider the style of approach that is taken by their credit management and collection partners to ensure this balance is achieved."
Cabot has adopted a pioneering philosophy of securing a realistic and fair resolution of outstanding accounts through a methodology of 'polite persistence'. This is supported by a combination of process efficiency, management expertise and use of technology.
Mr Maynard explains, "To meet increased demand for our service we have doubled the size of our team. We now have 120 people based in our call centre in West Malling and we have just purchased new premises to accommodate a further 70 staff over the next few months. All our new employees undergo extensive training and will be introduced to our unique approach. At Cabot we never forget that a 'cardholder or borrower is actually a customer, first and foremost and we treat them as such. Our objective is to ensure that customers get back on track with a repayment agreement that is realistic, fair and has a low probability of default. This meets the needs of the banks who receive a high performance credit management service and a positive on-going customer relationship. It also helps to repair the credit status of the individual customer. Even when payments are being made regularly, Cabot Financial continues to review the arrangement with the aim of reducing the amortisation period. We view our business as relationship, not transactional driven. As a result, we have letters of testimonial in our offices from both banks and their customers thanking us for the way in which we conduct our service with diplomacy and respect."
For information on Cabot Financial please contact
Ken Maynard
Cabot Financial (Europe) Ltd
10 Kings Hill Avenue
Kings Hill
West Malling
Kent ME19 4LT
Tel: 01732 775000
Fax: 01732 522374
E-mail kmaynard@cabotfinancial.com
MODERNISING LAND AND PROPERTY MARKETS TO PROVIDE A WORLD-CLASS CONVEYANCING SERVICE
The Lord Chancellor, Lord Irvine, on the 12 December 2001 announced the Government's response to the Land Registry's Quinquennial Review published in June.
In setting out a wide-ranging, inter-Departmental programme of work he said:
"These modernisation plans, in particular the development of electronic conveyancing services, will bring major benefits to both homebuyers and businesses in their dealings in land and property. They will make the property market more transparent and the property transaction process faster, cheaper and more efficient.
"The Land Registry and the other Government Departments and agencies concerned will work with those who have an interest in land and property markets to take forward the programme's various elements over the next ten years."
The key elements of the programme are:
The Land Registry, whose commitment to high quality service has just been recognised by the award of its fourth Charter Mark in a row, is already taking forward a number of improvements recommended in the Quinquennial Review report. A new Strategic Business Plan, being developed for publication in Spring 2002, will set out clearly what the Land Registry intends to do in the next decade.
The Lord Chancellor said:
"The Quinquennial Review rightly endorsed the high quality service provided by the Land Registry. The new programme of work aims to increase the quality of these services even further. I am confident the Land Registry will meet the challenges ahead and move from success to success."
Work Programme
The work programme has been posted up on the Land Registry website ( http://www.landreg.gov.uk - see What's New?)
Electronic conveyancing will modernise the process of buying and selling land. It will speed up the conveyancing process and make it cheaper by replacing the current paper based system with a modern electronic one.
A legal framework for this new system will be provided by the Land Registration Bill now before Parliament. Its introduction will allow the re-engineering of the processes involved in buying and selling land and property to reduce the time taken between offer and completion, link completion and registration (with potential for these to occur simultaneously) and reduce costs. There is also potential for a linked system of electronic settlement, allowing related financial transactions to be conducted electronically alongside the e-conveyancing process.
The new electronic business processes will be developed over the next five years with the close involvement of stakeholders. A major public consultation on a possible model for the electronic conveyancing system will be launched next year.
BYERS ANNOUNCES FINANCIAL ASSISTANCE TO AIRLINES
In answer to a written Parliamentary Question from Lindsay Hoyle (MP), Mr Byers on the 13 December 2001 said:
"I have decided to provide up to £40 million of financial assistance to compensate airlines for losses arising directly from the 11 September terrorist attacks in the United States. Qualifying airlines will now be invited to submit claims under this scheme. I have placed a copy of the scheme conditions in the Library.
Compensation under the scheme will cover lost revenue over the period during which airspace was closed. It will also compensate for additional costs incurred during that period, such as (but not limited to) airport and airspace charges, costs incurred in transporting passengers from their diverted destination to their intended destination, additional operating costs of diverted aircraft and additional crew costs.
In making this decision I have had regard to the views of many hon.Members who have written to me, of their constituents, of the airlines and of the Trades Unions. I accept that the circumstances, which are consequent both on the terrorist attacks and on the subsequent decisions affecting airspace, are indeed exceptional and therefore merit exceptional assistance.
The Government has worked with its European partners to minimise distortions to the single market, and has therefore supported guidelines, which limit airline compensation to cover these exceptional circumstances.
The assistance I am offering will help airlines at a time when passenger numbers on services between the UK and US, and therefore revenues, are still significantly below their pre-11 September levels, but without distorting competition or relieving airlines of the need to take appropriate measures to meet the changed conditions in the market. The UK is giving a lead in the EU in announcing a scheme of financial assistance in respect of the closure of US airspace, just as it was the first to provide third party war risk insurance when the market failed.
Assistance under this package is in conformity with Commission guidelines on state aid, and I have notified the Commission of my intention accordingly."
NEW CHAIRMAN FOR ECGD'S ADVISORY COUNCIL ANNOUNCED
Trade and Investment Minister Baroness Symons on the 14 December announced that a new chairman has been appointed to the Export Credits Guarantee Department's (ECGD's) Export Guarantees Advisory Council.
Liz Airey, who is a Director at the oil consultancy firm Harrison Lovegrove &Co Ltd, has a strong financial background and serves as a non-executive director on the boards of three UK listed companies. Until last year she also sat on the Oil Industry Accounting Committee. She is already a member of the Export Guarantees Advisory Council (EGAC), and will take over as chairman from David Harrison from January 2002.
EGAC provides the Export Credits Guarantee Department (ECGD) - the UK's export credit agency - with advice on how it can both help British capital goods exporters to compete effectively and support the Government's wider international objectives.
Announcing the new appointment, Minister for Trade and Investment Baroness Symons said:
"I am delighted that Liz Airey has agreed to become the new chairman of the Export Guarantees Advisory Council.
"Since becoming a member of the Council in March 1998, Liz Airey has become a strong champion of the British capital goods exporter and I am confident that she will continue to do so in her new role."
Members on the EGAC have expertise in many areas of business including banking, emerging markets, corporate social responsibility and international development.
The appointment of Liz Airey has been made in accordance with Nolan procedures and the Seven Conditions of Public Life set out by the Committee on Standards in Public Life and listed in the EGAC's terms of reference. The appointment runs for three years, and is made by the Secretary of State for Trade and Industry, the Right Honourable Patricia Hewitt MP.
The boards on which Liz Airey sits as a non-executive director are AMEC Plc, The Fleming European Fledgling Investment Trust Plc and Telemetrix Plc.
The remaining members of the EGAC are:
ECGD maintains a register in which all EGAC members are required to record their business interests. Also, EGAC members are excluded from discussions which might create any conflicts of interest.
The EGAC is established by the Export and Investment Guarantees Act 1991 to provide independent advice to the Secretary of State for Trade and Industry, in respect of any matter relating to the operation of ECGD.
The terms of reference and minutes of the EGAC meetings are available on the ECGD website.
The EGAC was given a new set of terms of reference in November 2000 to redefine the main areas on which the Council would be asked to provide advice. These include the development of Business Principles ensuring that ECGD's own policies support those of the Government for good environmental standards, the promotion of sustainable economic development in emerging markets and good governance; ECGD's risk management policies; and, ECGD's marketing and product development policies.
Creditors are demanding more draconian treatment of insolvent directors, in opposition to the government's reforms to encourage enterprise, according to a survey published by the Insolvency Practitioners Association. 73% of those surveyed said that the current disqualification regime is too forgiving and insolvent directors should be pursued more vigorously.
Creditors are in direct conflict with New Labour's plans to encourage failed directors to start again in business, 78% of those surveyed preferring that they be banned from buying back into their failed companies. Despite directors often giving the best price for assets in an insolvency procedure, many creditors would be happy to receive less money to stop directors buying back into business. 57% of respondents stated that they would prefer to receive a lower dividend to prevent directors and their associates buying the assets of the failed company.
Keith Goodman, president of IPA, said that this is indicative of an unwillingness by creditors to move towards a rescue regime.
"Although I don't favour some elements of the government's proposed reforms, particularly relating to the identification of culpable directors, I am concerned that creditors should feel so strongly against a move towards a more forgiving rescue culture.
"Historically it has been the rescue-orientated procedures that have provided the best returns to creditors but these survey results indicate that creditors are less concerned about getting their money back and more intent on exacting revenge on failed directors."
Goodman went on to say that the government would be well advised to invest time persuading the business community of the merits of its proposals.
"Given the uncertainty in the UK economy we are likely to see more and more companies feeling the pinch. Creditors need to be persuaded of the benefits of encouraging enterprise to ensure they get more money back, thus protecting their own businesses."
The survey report also highlights that creditors want the regulation of the insolvency profession simplified by reducing the number of insolvency regulatory bodies. 64% of those surveyed said that regulation would be more effective with a single regulator, of which 43% strongly agreed with the suggestion.
Goodman continued, "It is unusual for a profession with just 1,500 members to be regulated by eight recognised professional bodies. Given the small number of practitioners and the complexities of insolvency law, even if the government does not want to introduce a single regulator it would make more sense to have fewer, more specialised regulatory bodies."
To request a copy of the report, please call 020 7251 1500 or email requests@ipa.uk.com
HEWITT APPROVES £3.75m SUPPORT FOR VIASYSTEMS
Hundreds of jobs to be saved thanks to Government grant
Trade and Industry Secretary Patricia Hewitt on the 12 December 2001 announced a Regional Selective Assistance (RSA) grant of £3.75m to support a new company being formed by the previous management team of Viasystems Tyneside Ltd (VTL). The grant will enable the company to start trading and save a minimum of 600 highly-skilled jobs.
The grant will enable the company to take some of the assets of the factory over from the administrative receivers, who have been running the plant since last September.
Announcing the Government's assistance, Patricia Hewitt said:
"This venture is vitally important both to South Tyneside and the wider North East economy.
"The team faces a challenging future but I believe the potential exists to bring the South Tyneside plant through current market difficulties and build a successful business again. This is a high-value company with a highly-skilled, experienced workforce and I believe it is right for the Government to support their efforts.
"The Government's grant will help retain in the North East a facility capable of delivering high quality, technically complex printed circuit board products. Hundreds of workers and their families in and around Tyneside will benefit as a result.
"I want to pay tribute to Charles Brooks' new management team, the workforce who have sustained the operation superbly since VTL went into receivership, the regional development agency One NorthEast, and all the other people who have worked so hard to secure this deal. I have every confidence that the management team and the workforce will form a strong partnership to face the challenges ahead."
In 1996, a £12m RSA loan was given to Viasystems Tyneside Limited. However, following the company's subsequent decision to call in the receivers, the company has been asked to repay the sums that were owed to the Department.
The former company Viasystems Tyneside Ltd, which has been in administrative receivership since 20 September 2001, has plants on South Tyneside and North Tyneside. The North Tyneside facility is closed and the new project will be based at South Tyneside. Certain plant and machinery from North Tyneside will move to the South Tyneside site.
The MBO team consists of three former members of the former VTL management team - Charles Brooks, financial director, Mauro Dallora, general manager, and Neil Chilton, business development leader. For more information on the MBO contact Charles Brooks on 07802 918685.
Regional Selective Assistance (RSA) is available to UK and overseas companies to support investment in the Assisted Areas of England, Wales and Scotland. Available to both manufacturing and service industries, RSA gives financial assistance to those projects which are seen to be viable, create or safeguard jobs, benefit the regional and national economy and which, without the assistance of RSA, would not go ahead.
COMMISSION APPOINTS RECEIVER AND MANAGER TO WEST LONDON CHARITY
Following its ongoing inquiry into the Royal Masonic Hospital Association of Friends, the Charity Commission has appointed a receiver and manager to take control of the charity and its assets.
Michael King, of the law firm Stone King was appointed on the 13th December and will report to the Commission with his recommendations.
Following the closure of the Royal Masonic Hospital in West London, which the charity was established to support, it will be required to either dissolve or alter its objects to achieve similar purposes elsewhere.
The receiver and manager will report to the Commission with recommendations for the organisation's future and a full report on the Commission's findings will be published on its website when the inquiry is complete.
The Charity Commission is a government organisation whose aim is to give the public confidence in the integrity of charity. It is accountable for its decisions to the courts and for its efficiency to the Home Secretary. It carries out a wide range of functions, including the registration, monitoring and support of charities and investigation of alleged wrong doings. There are five Commissioners, appointed by the Home Secretary.
Details for the Royal Masonic Hospital Association of Friends may be viewed on the Charity Commission register on its website http://www.charitycommission.gov.uk
ENRON EUROPE LTD (IN ADMINISTRATION) - UPDATE FOLLOWING SALE OF ENRON DIRECT
Administrators to Enron Europe Ltd. from PricewaterhouseCoopers have announced that the sale of Enron Direct Ltd. to Centrica for £96.4 million has provided a vital injection of cash to the energy company. Steven Pearson, partner at PricewaterhouseCoopers, one of the joint administrators appointed last week, said:
"Centrica paid a price which reflected the assets in Enron Direct and included a significant goodwill payment which would have been lost if the business had collapsed. It was a good deal for them and for Enron's creditors. The money buys time to ensure other Enron businesses are also sold at the best possible price, protecting jobs and investments." The administrators at PricewaterhouseCoopers is currently looking into selling the group's key assets, including the LME registered metals business, the commodity trading businesses, and the credit derivatives business. Progress is also being made in disposing of key commercial contracts. Negotiations are ongoing in all areas and announcements regarding future disposals are expected to be made shortly.
Tony Lomas, Steven Pearson, Dipankar Ghosh and Neville Kahn of PricewaterhouseCoopers, were appointed joint administrators on 29 November 2001 to the European holding company of the Enron group and a number of its operating companies. Their appointment followed the credit-downgrading of Enron on 28 November 2001.
*** FORTHCOMING CREDITORS MEETINGS ***
For detailed information on the British Isles insolvency's (liquidation's, receiverships, administrations, dividends, creditors) please visit http://www.insolvency.com/cgi-bin/gazette/liq/nots.pl
TW LW TW LW
USA 1.43 1.42 Canada 2.26 2.24
Austria 22.24 21.93 Portugal 324.04 320.78
France 10.60 10.49 Belgium 65.20 64.54
Finland 9.61 9.51 Italy 3129.59 3098.16
Germany 3.16 3.12 Sweden 15.17 14.99
Holland 3.56 3.52 Switzerland 2.38 2.36
Spain 268.93 266.22 Ireland 1.27 1.26
Australia 2.79 2.75 Denmark 12.03 11.91
Hong Kong 11.28 11.11 Euro 1.61 1.60
Africa Com 16.17 15.91 Saudi Arabia 5.42 5.34
India 69.14 68.28 Malaysia 5.49 5.41
Singapore 2.64 2.60 Norway 12.94 12.77
Japan 182.67 177.85
TW This week LW Last week.
Belhaven Brewery announced pre-tax profits of 5.02 million pounds, on turnover of 35 million, for the six months ending 30th September 2001. Earnings per share stand at 17.9p.
Eidos, the computer games maker, announced pre-tax losses of 27.4 million pounds, on turnover of 34 million, for the six months ending 30th September 2001.
Mountview Estates announced pre-tax profits of 8.94 million pounds, on turnover of 17.8 million, for the six months ending 30th September 2001. Earnings per share stand at 136.2p, on reduced capital.
NHP, the nursing home group, announced pre-tax profits of 10 million pounds, after exceptional charge, on turnover of 76.6 million, for the year ending 30th September 2001. Earnings per share stand at 8.7p.
Eliza Tinsley, the engineering group, announced pre-tax profits of 1.2 million pounds, after exceptional credit, on turnover of 37.7 million, for the six months ending 30th September 2001. Earnings per share stand at 3.3p, on increased capital.
Consignia, Britain's postal service, may have to lay off some 30,000 workers over the next year and a half, twice previous estimates for redundancies needed to save costs as postal growth slips.
Merck announced it's profits would not grow in 2002.
American Express announced another 6500 jobs are to go.
The top management of Zurich Financial Services has again been reshuffled.
Fiat announced job losses of 6000.
MERGER NEWS
The Secretary of State for Trade and Industry has decided, on the information at present before him, and in accordance with the recommendation of the Director General of Fair Trading, not to refer the following merger/s to the Monopolies and Mergers Commission under the provisions of the Fair Trading Act 1973:Acquisition by University College London Hospital of the London Heart Hospital
Acquisition by Reuters Group of Bridge Information Systems
Proposed acquisition by Saipem Group of the remaining 50% of European Maritime Contractors Ltd
Proposed joint venture between the Halliburton Company and DSND Subsea ASA
NEW MERGERS DIRECTOR AT OFT
Simon Priddis, currently with the US law firm Cleary, Gottlieb, Steen and Hamilton, has been appointed the new Director of Mergers at the Office of Fair Trading. Mr Priddis takes up his new post in March on the retirement of OFT's Andrew White.
The Director of Mergers plays a key role in decisions taken on UK mergers and in formulating UK views on cases falling under EC Merger law. With Government proposals to grant the OFT more autonomy in the merger process, the responsibilities of this post are set to increase.
Mr Priddis received law degrees from Cambridge University. Having qualified as a barrister, he worked in the Government Legal Service mainly covering EC Law for the Departments of Health and Social Security. He joined Cleary's Brussels office in 1997 where his practice focused on EC, UK and multinational merger cases. He transferred from Brussels to Cleary's Washington DC office in early 2000 where he has worked on US merger cases before the Federal Trade Commission and the Department of Justice. He is married with one son.
http://www.oft.gov.uk
UK to hold first ever e-Europe conference with former Eastern European Countries
E-Commerce Minister, Douglas Alexander on the 11 December 2001 opened the first ever e-Europe conference sharing UK expertise in e-commerce and the wider e-agenda with its Eastern European neighbours.
Countries attending include Estonia, Hungary, Macedonia, Bosnia & Hertzogovina and the Czech Republic. The conference is part of a European-wide initiative ensure a successful and prosperous European knowledge economy.
Mr Alexander said:
"Early adoption of the knowledge economy will contribute to improving the competitiveness of the countries of former Eastern Europe, and therefore Europe as a whole. Greater prosperity in Central, Eastern and South-Eastern Europe benefits everyone on the continent through greater opportunities for trade and investment.
"The UK is currently one of the world's most connected economies. Internet use is higher than in any other European country. This is producing the highest level of e-commerce outside the US. Last year, 2.3m more UK adults were buying online - spending a total of £1.2 billion.
In 2001, EU candidate countries launched the eEurope+ initiative. This is a commitment to embrace the challenges of a knowledge economy by developing strategies for the information society in each country to accelerate the reform and modernisation of their economies. It mirrors the EU's eEurope Action Plan, but with additions and changes to the objectives and timetable to reflect the economic and social situation in those countries. Thus eEurope+ aims to ensure that an enlarged EU will not suffer from a digital divide between old and new member states.
Mr Alexander added;
"It is important to spread the Internet and e-commerce as widely as possible. There has been recognition from the start that the pursuit of economic reform in Europe must involve both the current member states and the future member states - and this initiative reflects that insight.
"Sharing the UK's experience and achievements will help build the whole of Europe as a prosperous knowledge economy."
The conference is held by the Foreign Office and the Office of the e-Envoy in London on Tuesday 10 and 11 December 2001.
Representatives of the following countries and organisations are attending: Republic of Serbia, Czech Republic, Hungary, Lithuania, Latvia, Turkey, United Kingdom, Estonia, Montenegro, Bulgaria, United Kingdom, Bosnia and Hertzogovina, Albania, Poland, Macedonia, OECD, European Commission.
The action plans can be found at:
eEurope Action plan 2002:
http://europa.eu.int/information_society/eeurope/action_plan/actionplantext/index_en.htm
eEurope+ Action plan 2003:
http://europa.eu.int/information_society/international/candidate_countries/action_plan/index_en.htm
ALEXANDER: CURRICULUM ON-LINE IS IMPORTANT NEW OPPORTUNITY FOR BROADBAND SECTOR
Douglas Alexander, the E-Commerce Minister, welcomed the announcement of 'Curriculum On-Line', by the Prime Minister and the Education and Skills Secretary Estelle Morris, as an important new opportunity for the broadband sector.
The £50m announced last week to fund 'Curriculum On-line' is the world's first partnership between a government, leading public/private broadcasters and innovative software producers to provide on-line materials for every curriculum subject to transform learning in schools.
Mr Alexander said:
"Curriculum On-line will bring exciting new learning tools into schools giving teachers more options and pupils access to more individualised leaning.
"Curriculum On-line is an important new opportunity for the broadband sector and will playing a key role in driving forward the Broadband Britain revolution.
"Development of on-line learning material for each curriculum subject challenges content providers to develop innovative new products and offers a valuable new market.
"The announcement follows the publication last week of the Broadband Action Plan - a comprehensive package of measures to broadband success in the UK."
Schools will need broadband connections with sufficient capacity to support multi-media and other rich learning content, including video to make full use of Curriculum On-line as it develops in the future.
Andrew Pinder, the Government's E-Envoy said:
"The announcement on Curriculum Online is very exciting. The benefits it will bring to students and teachers in schools throughout the country are staggering. The UK is set to become the first country in the world to provide a National Online Curriculum by bringing the transforming powers of ICT content - and in particular broadband content - directly to children's classrooms."
Anthony Lilley, Member of the Broadband Stakeholders' Group Executive and Managing Director of Magic Lantern said:
"I welcome the government's decision to look to the future of education by ensuring that schools have resources to purchase educational content specifically tailored to broadband delivery. Not only will this have a positive effect on learning, it will help the digital content industry to produce educational products and services which are both innovative and commercially viable."
Dr Peter Radley, member of the Broadband Stakeholders' Group Executive and Chairman of Alcatel, said:
"I warmly welcome this initiative which aligns directly with the recommendations from the Broadband Stakeholders' Group. I know from personal experience how Broadband makes an enormous difference to the interactivity and ease of use of material for students (from my role as a Governor of Bishop's Stortford College). The initiative not only illustrates a vital domain of Broadband content and applications, but is also very real evidence of Government as customer right at the heart of creating Broadband Britain."
Curriculum On-line has five key components:
Douglas Alexander published the Government's response to the first report by the Broadband Stakeholders' Group on 3 December 2001. Copies of both reports can be found at www.e-envoy.gov.uk
The Broadband Stakeholders' Group brings together organisations from the broadband supply industry, the content industry, private and public sector users of broadband and consumer organisations.
Monday 10 December Wessex Branch of the ICM Quiz Night - Sponsor Virtual Mailroom Ltd Venue - Royal Southampton Yacht Club 1 Channel Way, Ocean Village, Southampton SO14 3QF Time : 7.00 pm for 7.30 pm Refreshments provided Monday 14th to Thursday 17th January 2002 ICM Examinations Thursday 24 January 2002 Sussex & Surrey Branch of the ICM Annual General Meeting Followed by Dinner. Speaker: To be advised Venue - The Imperial Hotel, Hove Time: 7.00 for 7.30 p.m. 27 - 29 January 2002 FCIB - A Global Association of Executives in Finance, Credit & International Business 108th International Conference & Workshop In Europe Amsterdam Marriott Hotel The Netherlands For further information Telephone: + 44 (0) 1865 481 630 Fax: + 44 (0) 1865 481 482 Email: timlane@fcib-europe.org Website: www.fcibglobal.com Friday 22 February 2002 Debt Sale & Purchase Credit Today, Savoy Hotel, London The second annual debt sale and purchase conference chaired by Rob Levick. For details e-mail carleen@credittoday.co.uk Wednesday 13 March 2002 ICM National Conference and Exhibition Heritage Motor Centre, Gaydon near Warwick For full details tel 01780-722907 or e-mail training@icm.org.uk 7 - 13 April The Credit Academy, 7 day Residential Course FT Knowledge Financial Learning London, 80 Strand, WC2R 0RL Contact Jane Lees - E-mail jane.lees@nyif.com +44 (0)20 7010 2568 17 and 18 April Credit 2002 - The Definitive Event for the Commercial and Consumer Credit Industry Brompton Hall, Earls Court, London For more information contact vtolson@advanstar.com 22 - 28 April The Credit Academy, 7 day Residential Course FT Knowledge Financial Learning Venue - Hong Kong, location tbc Time: 08.30 Contact Jane Lees - E-mail jane.lees@nyif.com Tel +44 (0)20 7010 2568 10 - 16 June The Credit Academy, 7 day Residential Course FT Knowledge Financial Learning Venue - New York, location tbc Contact Jane Lees - E-mail jane.lees@nyif.com Tel +44 (0)20 7010 2568 21 June The ICM Fellows Luncheon Churchill Room, The House of Commons Westminster, London Guest Speaker Norman Lamb MP Cost 49.50 GBP inc of vat and all drinks Contact ICM Training Department on 01780-722907 E-mail sheila@icm.org.uk If you have an event coming up which is credit management related and you would like us to make an entry in the Diary section please e-mail the details to jarnold@creditman.co.uk
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