The UK government attempted to mend its bridges with furious Railtrack shareholders yesterday,by ple...
The UK government attempted to mend its bridges with furious Railtrack shareholders yesterday,by pledging to help the company access £370m in cash to compensate investors, reports the FT this morning.
Still reeling from the City backlash over the government's decision to force Railtrack into administration, ministers signalled that the money, frozen by Railtrack's bank, should be released.
However, Stephen Byers, transport secretary, has refused a request by Railtrack to use public money to compensate shareholders at the rate of £3.60 a share - the price at which the company floated in March 1996. As well as the £370m cash - worth 70p per share - shareholders could stand to gain up to a further 90p a share from assets owned by Railtrack's parent company Railtrack Group. The shares closed on Friday at £2.80.
Axa, one of Europe's biggest insurers, is planning to cuts costs worldwide by 10% next year in response to the deteriorating economic climate and the downturn in global equity markets, adds the FT.
The French group said it hoped to cut costs in 2002 by between E700m ($644m) and E1bn ($920m). Of that, E250m will come from its US subsidiary, Axa Financial.
The insurer gave no details of where the cuts would fall, but suggested that jobs would not be the first target. Axa employs 140,00 people in about 60 countries.
The group said: "We are in a service industry, people's expertise is important to us."
Shares in Axa, which have fallen almost 60% since the start of the year, closed 4% higher on Wednesday in Paris at E23.25.
Rupert Walker, the Govett Investments fund manager who publicly denounced the practices of split-capital investment trust managers, is appealing against his dismissal, says the Times.
Walker was dismissed early last month by Govett, part of Allied Irish Banks, after claiming in an article in the Financial Times that investment trust companies continued to launch new funds with "scant regard for market conditions".
He also attacked fund managers for holding shares in each other's trusts. According to a report from Cazenove, the stockbroker, the practice could cause a "systemic collapse" in the industry, as falls in share values mean up to 20 split-capital trusts are close to breaking banking covenants.
Marconi outraged shareholders and unions yesterday when the telecoms equipment maker admitted that it had paid former bosses £900,000 in compensation, despite their presiding over a period in which the shares fell by 99%, reports the Daily Telegraph.
Lord Simpson, who was forced to resign as chief executive in September following the company's second profits warning this year, will receive £300,000.
His former deputy and intended successor, John Mayo, who was ousted in July, has already been paid £600,000. Company sources added that Mr Mayo is still in dispute over further payments that are understood to total more than £1 million.
Cantor Fitzgerald, the bond trader that lost 700 employees in the terrorist attacks on the World Trade Centre, yesterday pledged to pay a quarter of profits to bereaved families for at least five years, continues the Daily Telegraph.
Howard Lutnick, the chairman who broke down on television following the tragedy and promised to run the company for the benefit of staff in future, said profits would be distributed until every family had received at least $100,000 in cash (£70,000).
The first use of the funds will be to pay for 10 years of health care for families of the dead, which will cost $70 million.
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