Engineering giant GKN says it will sell off parts of its business and return £2.5bn in cash to its shareholders over the next three years. The plans are part of its defence against a £7.4bn hostile takeover bid from Melrose Industries. GKN’s new strategy and transformation plan includes the […]
Two people have been arrested in a raid on the home of the controversial Gupta family in South Africa as part of a government influencing investigation. The wealthy India-born Gupta family have been accused of “state capture” – using their friendship with President Zuma to wield enormous political influence for their business interests. Both Mr Zuma and the Guptas deny the allegations made against them. Mr Zuma is under pressure to resign, in part because of links to the Guptas. He is expected to respond later today to a formal request from the African National Congress (ANC) to step down.
The World Chess Federation (FIDE) says its Swiss bank accounts have been closed after its president was accused of facilitating transactions on behalf of the Syrian government. Russian millionaire Kirsan Ilyumzhinov was added to a US Treasury Department sanctions list in 2015 for his alleged dealings with the Assad government. He denies wrongdoing, and stepped back from FIDE to try to resolve the issue. But FIDE says Swiss bank UBS closed its accounts as he is still sanctioned.
WASHINGTON (Reuters) – U.S. consumer prices likely increased solidly in January, boosted by rising gasoline and rents, but annual inflation growth is expected to have slowed as the large price gains from last year drop out of the calculation. Despite the anticipated moderation in the annual inflation rates, Wednesday’s report from the Labor Department will probably not change expectations for an acceleration in price pressures this year. A surge in annual wage growth in January ignited inflation concerns, sparking a sell-off on Wall Street and lifting benchmark U.S. Treasury yields to a four-year high. There are fears that inflation, which is seen driven by a tightening labor market and increased government spending, could force the Federal Reserve to be a bit more aggressive in raising interest rates this year than is currently anticipated.
The U.S. central bank has forecast three rate hikes this year, with the first increase expected in March.
TOKYO (Reuters) – Toshiba Corp appointed a former banker from a key creditor bank as CEO and forecast its first annual profit in four years, making progress in its efforts to recover from billions of dollars in losses at its U.S. nuclear unit Westinghouse. Nobuaki Kurumatani, a former executive of Sumitomo Mitsui Financial Group, will become chief executive and chairman from April 1 and will be responsible for longer-term strategic decisions as well as dealing with outside parties. Current CEO Satoshi Tsunakawa who has overseen Toshiba’s attempts to dig itself out of its financial crisis, will become chief operating officer and be responsible for day-to-day operations.
Bolstered by its chip business, the struggling industrial conglomerate predicted net profit of 520 billion yen ($4.9 billion) for the year ending March, up from a prior forecast of a 110 billion yen loss and much higher than a consensus estimate of a 188 billion yen profit. The revised estimate comes on the back of a sale of Toshiba’s claims against now-bankrupt Westinghouse Electric Co LLC to a group of hedge funds, a deal that also affords the Japanese firm tax benefits. The return to net profit, combined with an additional 600 billion yen gained from the issue of new shares to overseas funds, will help Toshiba avoid falling into negative net worth for a second consecutive year, allowing it to remain a listed company. That in turn means less urgency for Toshiba to sell its prized chip business – the world’s second biggest producer of NAND memory chips – to a consortium led by U.S. private equity firm Bain Capital. The revised estimates also showed, however, that without the memory chip division, its annual operating profit is set to be zero.