2 May 2014 Last updated at 05:57

Business Live: Friday 2 May 2014

  1.  
    06:00: Howard Mustoe Business Reporter

    Good morning everyone, it's Friday! We'll be looking forward to RBS results and US jobs numbers. Keep with us.

     
  2.  
    06:00: Rebecca Marston Business reporter, BBC News

    Those RBS results will doubtless provide much to talk about when they're out in an hour's time. There are reports it may make a rare profit this quarter - something to cheer! Talk to us on bizlive@bbc.co.uk or @bbcbusiness

     
  3.  
    FOREIGN TAKEOVERS 06:02:
    Heseltine

    If the drugs giant Pfizer ends up taking over the UK's AstraZeneca it would be the biggest takeover of a UK company by a foreign one. Our Business editor has bearded the former Trade minister Lord Heseltine on the subject. He told him takeovers "could be very helpful", but the UK should do more to protect its national interests.

     
  4.  
    FOREIGN TAKEOVERS 06:11:

    One of the reasons US companies in particular like to buy foreign companies is to help keep the tax bill down. Confused? Read this explainer by colleague, Tom Espiner.

     
  5.  
    RBS 06:16: Radio 5 live

    Laura Lambie, senior investment director at Investec Wealth & Investment is on Wake up to Money talking about Royal Bank of Scotland's results. She's expecting news of a return to dividend payout, perhaps in 2016. She'll also be looking out for any news on what it will do about the US bank - Citizens - and Ulster bank.

     
  6.  
    KITE MARKS 06:35: BBC Radio 4
    Kite mark and man

    The man ultimately responsible for issuing kite marks - badges of excellence for products from fire extinguishers to condoms, is Howard Kerr, chief executive of the British Standards Institution. He is on Today explaining it stands for quality - and value for money.

     
  7.  
    CHANNEL 5 06:43: BBC Radio 4
    Channel 5 Newstalk Live set The new set will appear on air from 8 July

    Viacom picked up Richard Desmond's Channel 5 for £450m yesterday. The company's chief executive Phillippe Dauman told the Today Programme: "Channel 5 has a lot of room to grow. We think there's a lot of upside, a lot of ways in which we can enhance the programming, market it better, distribute it better. In several years the UK public will look at Channel 5 as a great British institution." Business Live already does...

     
  8.  
    FOREIGN TAKEOVERS 06:53: BBC Radio 4

    BBC Business Editor Kamal Ahmed is telling Today programme more about his interview with Lord Heseltine on foreign takeovers. Takeovers of UK businesses by those from less-democratic countries is one of his concerns, says Kamal. "He thinks we should be thinking about the future as well as what's happening with AstraZeneca today."

     
  9.  
    RBS RESULTS 07:00:

    RBS reports quarterly pre-tax profits of £1.6bn up from £826m last year.

     
  10.  
    PFIZER MAKES NEW OFFER 07:01:
  11.  
    PFIZER MAKES NEW OFFER 07:11:

    The statement says: "Pfizer hopes that the increased proposal will provide the basis for AstraZeneca to engage with Pfizer and enter into discussions relating to a possible combination of the two companies." The previous offer of £46.61 in cash and shares failed to impress AstraZeneca - which rebuffed the US giant.

     
  12.  
    PFIZER MAKES NEW OFFER 07:14:

    The new offer is just above AstraZeneca's closing price yesterday of £48.16. Expect some good share price action after 08:00 when trading begins.

     
  13.  
    PFIZER LETTER 07:15:

    Pfizer has sent a letter to David Cameron about its wish to take over AstraZeneca. It begins: "Dear Prime Minister, I am writing to you to address the concerns of the UK Government and science community." If Pfizer persuades the UK drugs company to sell it would be the biggest ever takeover of a UK company by a foreign one.

     
  14.  
    HEADLINES
    • RBS shares up 10% on quarterly results
    • Pfizer raises bid for AstraZeneca
    • Eurozone unemployment at 11.8%
     
  15.  
    PFIZER MAKES NEW OFFER 07:24: BBC Radio 4
    Pfizer HQ

    Heather Self, tax expert at Pinsent Masons tells the Today programme about some of the tax benefits to Pfizer of buying Astra,: "Pfizer want to put a UK company on top of the whole group which is taking the whole company outside the US tax system." US corporation tax is 35% - the UK's is just over 20%.

     
  16.  
    RBS RESULTS 07:27:
    A customer walks into a branch of the Royal Bank of Scotland building

    Charges for bad loans were down by £671m to £362m from a year earlier. There were "significant improvements" at Ulster Bank, where bad debt charges were down 80%. In UK Corporate lending they dropped 66%. The bank posted an £8.2bn pretax loss in 2013 with restructuring costs and misconduct charges hitting.

     
  17.  
    RENTOKIL 07:36:
    rats

    Rodent-killers Rentokil says profit before tax for the first three months of their financial year rose 6% to £19.3m. The firm said it expects the cost of reorganising itself to be £10m for the year, £10m lower than estimated previously.

     
  18.  
    RBS RESULTS 07:45: BBC Radio 4

    William Wright, financial commentator, tells the Today programme: "It's an initial cause for celebration but it is very early days. For the past five years we've been defusing this financial time bomb. The new boss is trying to get the bank smaller and simpler."

     
  19.  
    RBS RESULTS 07:58:

    The bank is 80% owned by the government. The total the bank has lost since its bailout stands at £46bn.

     
  20.  
    PFIZER MAKES NEW OFFER 08:12:
    AstroZeneca sign

    Pinsent Masons' Heather Self tells the Today programme that it wil be pretty simple for Pfizer to access the tax gains of buying AstraZeneca - with little gain for the UK: "All it will mean is moving a few senior people here and having a few board meetings here. It doesn't mean anything for the UK tax industry."

     
  21.  
    RBS SHARES JUMP 08:22:

    RBS shares have jumped 10% to 337p following news of its results - which contained no nasties, on the face of it.

     
  22.  
    RBS RESULTS 08:28:

    "With loan growth expected to return in the back end of 2014 we see significant upside" for the bank's corporate lending business, says Bernstein analyst Chirantan Barua. He also notes this quarter "was the first quarter of profit for Ireland since 2009". If the economy improves in Ireland, the lender could next year undo some of the writedowns it made on its loans, he said.

     
  23.  
    RBS SHARE PRICE 08:43:

    Richard Hunter from stockbrokers Hargreaves Lansdown notes the share price jump: "It seems that these numbers represent the calm before the storm. The initial share price reaction seems tinged with some relief." However, the gravel-voiced commentator goes on to say he's still not impressed. "Market consensus remains firmly rooted to a sell."

     
  24.  
    MARKETS UPDATE 08:57:

    London's benchmark FTSE 100 index was up 0.06% led by a 11% rise in Royal Bank of Scotland after well-received first-quarter results and a 8.7% rise for InterContinental Hotels Group. Frankfurt's Dax was down 0.05% and the Paris Cac 40 was down 0.3%.

     
  25.  
    DIRECT LINE 09:08:

    The UK's biggest car insurer, Direct Line, says premiums fell 5.6% in the first quarter. Competition between insurers for home and car insurance is stiff. It says its strategy to keep up profits is to go for higher profit margins rather than customer numbers. Investors appear happy with this: Shares are up 2.6%.

     
  26.  
    ASTRAZENECA RESPONSE

    AstraZeneca tells shareholders to take no action. "There can be no certainty an offer will be made or as to the terms of any offer." It says the board will meet soon to discuss the offer on the table.

     
  27.  
    PFIZER MAKES NEW OFFER 09:29: BBC Radio 4

    As the debate about what Pfizer would do to AstraZeneca should it gain control heats up, David Willetts, minister for Universities and Science tells the Today programme: "The chief executive [of Pfizer] was in London he asked to see us, he had conversations quite rightly with George Osborne, with myself and with Vince Cable and in those all of us pressed him very hard that what we would expect of Pfizer if this deal went ahead which would be a decision for Astra Zeneca shareholders. We would expect of them to understand and commit to the R and D activities of which we are proud in Britain and to manufacturing."

     
  28.  
    PFIZER MAKES NEW OFFER 09:38:
    AstraZeneca HQ

    AstraZeneca's shares are now down almost 1% at £47.77. That's well below the new offer of £50 indicating a lack of confidence in the bid's success.

     
  29.  
    FOREIGN TAKEOVERS 09:57: BBC Radio 4

    Pfizer is so concerned about opposition to foreign takeovers it wrote a letter to David Cameron saying AstraZeneca would be safe in its hands. Backing for a hands-off approach comes from Sir Nicholas Scheele, a former chief executive of Jaguar, on the Today programme: "Government has proven itself over many many years, not least with British Leyland but also with shipyards, it has no idea how to run businesses. They should stay out of it."

     
  30.  
    EUROZONE UNEMPLOYMENT

    Official statistics show the unemployment rate unchanged in March at 11.8%.

     
  31.  
    EUROZONE UNEMPLOYMENT 10:11:
    Job centre

    Although the March rate is unchanged at 11.8% (below the record set in 2013 of 12%) unemployment across the 18-country bloc is falling. Eurostat, the EU's statistics office, said it fell to 18.91 million from 18.94 million the month before.

     
  32.  
    INTERCONTINENTAL HOTELS GROUP 10:23:
    ICH hotel

    InterContinental Hotels Group is another strong share price performer this morning. Its shares are 8.7% higher following its results which include the promise of a special dividend payout to shareholders of $750m.

     
  33.  
    PFIZER MAKES NEW OFFER 10:33: BBC Radio 4

    "There is grave concern in the business community and in the sector about this transaction. I have yet to speak to anybody in the sector who has anything other than reservations about this deal." That's Chuka Umunna, the shadow business secretary, on the Today programme, speaking about Pfizer's AstraZeneca bid.

     
  34.  
    NETWORK RAIL BONUSES 10:43: Richard Westcott BBC transport correspondent
    The spending will include upgrading stations and lines

    The new boss of Network Rail, Mark Carne, is cutting bonuses for his top executives. A maximum bonus of 160% of salary will be slashed to a maximum of 20% of salary per year, which is the minimum the regulator will allow under the licence condition. "I am told they WON'T be getting a pay rise to compensate," says our Transport correspondent.

     
  35.  
    ASTRAZENECA REJECTS BID Breaking News
  36.  
    ASTRAZENECA REJECTS BID 10:58:

    The UK drugs company's statement goes: "The financial and other terms described in the proposal are inadequate, substantially undervalue AstraZeneca and are not a basis on which to engage with Pfizer. Leif Johansson, chairman of AstraZeneca, said: "AstraZeneca continues to invest significantly in research, development and manufacturing in the U.K., Sweden and the US. We are showing strong momentum as an independent company."

     
  37.  
    ASTRAZENECA REJECTS BID 11:16:
    graphic

    Clear-as-a-bell graph from the Wall Street Journal tracking Pfizer's staff numbers throughout its takeover spree of the past 15 years. Begins with 51,000 jobs in 1999, adds more than 134,000 jobs through takeovers over the years to that. Ends with 77,700 as of now. Divestments throughout that period - if any - not charted.

     
  38.  
    ASTRAZENECA REJECTS BID 11:29:
    chairman

    Leif Johansson, chairman of AstraZeneca, tells shareholders why his board isn't keen on a takeover in this video here. Although it was made before today's rejection, it explains the company's thinking. "As well as several regulatory approvals for new medicines in our core therapeutic areas, one cancer compound was designated breakthrough therapy status and another given a priority review in the US".

     
  39.  
    Via Twitter Adam Parsons Business Correspondent

    tweets: "Kerching: value of public stake in RBS gone up by about £2.7bn this morning"

     
  40.  
    PFIZER ASTRAZENECA BATTLE 11:53: BBC News Channel

    One of AstraZeneca's major shareholders says it would most likely sell if the offer from Pfizer was "right". Sue Noffke, of Schroders, which owns 2% of AstraZeneca, tells the News Channel: "Most shareholders would be looking for something higher. What we're seeing is the unfolding of a courtship between the two. It needs to be at a level that convinces us to sell out of a company that we've been long term shareholders in."

     
  41.  
    AIR FRANCE STRIKE 12:06:
    Air France-KLM plane

    France's main pilots' union is cancelling plans for a month-long strike. It was due to start on Saturday and had been expected to cause serious disruption to Air France flights throughout the month.

     
  42.  
    SCOTTISH INDEPENDENCE 12:21:

    Scotland would likely hold a lower credit rating than the rest of the UK immediately after independence, according to the ratings agency Moody's. The agency predicted an independent Scotland would hold an investment-grade A rating - below the UK's current Aa1. Last year, Moody's became the first of the three major ratings agencies to cut the UK from its highest AAA rating to Aa1.

     
  43.  
    PFIZER ASTRAZENECA BATTLE 12:34:

    The GMB union is concerned about the prospect of Pfizer taking over AstraZeneca, where it represents part of the workforce. It says the bid must be referred to the competition authorities. "Pfizer are said to have given undertakings to the UK government... similar undertakings were given by US multinationals before which have proved to be worthless." It may have in mind Kraft's takeover of Cadbury, which saw a plant near Bristol shut despite an apparent pledge to keep it open.

     
  44.  
    MARKET UPDATE 12:51:

    The FTSE 100 has gained a little, up 0.24% since yesterday's close. RBS still leads the pack with a 9.2% gain. InterContinental Hotels Group is up 9%. The Cac 40 in Paris is down 0.5% and the Dax in Frankfurt fell less than 0.1%.

     
  45.  
    12:52: Via Twitter Linda Yueh Chief business correspondent

    tweets: "Worldwide, aged 65+ will nearly double to 1.1bn in 2 decades; we're Talking the business of ageing 14:30GMT" Coming up in her weekly programme, Talking Business.

     
  46.  
    PFIZER ASTRAZENECA BATTLE 12:54:
    Former Pfizer plant in Sandwich

    The GMB recalls: "Pfizer walked away from a purpose-built manufacturing plant in an economic bleak spot in Kent with the loss of many jobs. Pfizer are involved in a huge pharmaceutical joint venture in China. The UK Government has an absolute duty to act to protect against these jobs being migrated away for the UK." It is referring to the plant at Sandwich where Viagra was invented. It is now an enterprise zone.

     
  47.  
    RENTOKIL 12:55:
    Rentokil film on pest control

    And finally, Business Live confesses to a professional fascination with Rentokil's work - indeed, part of the team accompanied a drain unblocking expert on a job for one memorable assignment. Rentokil of course is often called the "ratcatcher extraordinaire". Other keen rodent watchers could spend their lunchtime checking out this film from its media relations website showing how they do it.

     
  48.  
    13:00: Howard Mustoe Business Reporter

    That is that for another week. More business morsels next week. Enjoy the long weekend!

     

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