Frenkel Topping Share News (FEN)

LONDON (Alliance News) - TSB Banking Group is set to end its brief life as a London-listed company, after Barcelona-based Banco de Sabadell won the backing of both TSB's board and majority owner Lloyds Banking Group for its GBP1.7 billion takeover offer.

TSB, which was carved out of Lloyds and floated on the London Stock Exchange in June 2014, is valued at 340 pence per share under the deal, which analysts said is likely to clear all hurdles to completion. The stock was quoted at 333.60 pence at midday.

The deal was welcomed by Lloyds Chief Executive Antonio Horta-Osório, who was tasked with selling off the bank's holding in TSB by the end of 2015 in order to make good on a commitment made to the European Commission after the FTSE 100 bank required a government bailout during the financial crisis of 2007-09.

"This is a significant and positive step for the group and will enable us to meet our commitments to the European Commission, well ahead of its mandated deadline," Horta-Osório said in a statement Friday.

Lloyds can net up to GBP850 million in cash for its 50% holding in TSB, although the bank expects to take a charge in connection with the deal.

Sabadell's purchase of TSB comes just over a decade after compatriot Banco Santander, the largest bank in Spain, began its expansion into the UK with the acquisition of Abbey National in 2004. Sabadell, a Catalan commercial bank, employs more than 17,000 people in about 2,200 branches and describes itself as Spain's fifth largest banking group with assets amounting to EUR163 billion at the end of 2014.

The Spanish bank's pursuit of TSB comes under a strategy of diversifying away from its home country, which was hit hard by the popping of a real estate bubble and the failure of several lenders. Sabadell is launching an underwritten rights issue to raise EUR1.6 billion aimed at maintaining its capital position, meaning the offer is "not conditional" on the fundraising.

Acquiring TSB will give Sabadell access to a retail and small business bank with several million customers and more than 600 branches across England, Scotland and Wales, giving it a point from which it can develop a strategy to take on the big British high-street lenders. Sabadell said it doesn't envisage that it would "significantly change" TSB's branch network or staff numbers "in the short term".

TSB Chief Executive Paul Pester, who is to remain in his role, alongside Chairman Will Samuel and Chief Financial Officer Darren Pope, said that Sabdell's offer is a "vote of confidence" in the bank.

Shore Capital said the acquisition will improve TSB's position in the UK market.

"We expect ownership by Sabadell to enhance TSB's competitive position in the UK banking market which is likely to be welcomed by the UK government and competition authorities, albeit this may therefore be to the detriment of the existing large incumbents," said Shore analyst Gary Greenwood.

"It is also likely that TSB will be used as a platform for Sabadell to make further acquisitions in the UK, thus further increasing its scale and competitive position," Greenwood added.
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Markets: London main stock indices are mixed, with CRH leading the FTSE 100 after the on-again, off-again merger between Switzerland's Holcim and France's Lafarge appeared to be back on. US futures point to a higher opening, with the DJIA pointed up 0.7% and the S&P 500 and Nasdaq 100 both seen up 0.5%.

FTSE 100: up 0.1% at 6,969.30
FTSE 250: up 0.3% at 17,492.13
AIM ALL-SHARE: down 0.1% at 714.44
GBP-USD: up at 1.4792
EUR-USD: up at 1.0726
GOLD: up at USD1,174.86 an ounce
OIL (Brent): down at USD53.66 a barrel
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Other Top Corporate News
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The boards of Holcim and Lafarge said they have reached an agreement on revised terms of their proposed USD41 billion merger, with Holcim getting a more favourable exchange ratio and the heads of both cement companies to be co-chairmen of the merged entity, in news likely to give a boost to FTSE 100 members CRH and Anglo American. Holcim and Lafarge said they had reached an agreement on revised terms, including a new exchange ratio of 9 Holcim shares for 10 Lafarge shares. A new chief executive for the combined group, which will be proposed by Lafarge and accepted by Holcim, will be appointed following the closing of the transaction. Holcim Chairman Wolfgang Reitzle and Lafarge Chairman and Chief Executive Bruno Lafont will be non-executive co-chairmen of the combined company.
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British Land Co said it has completed a GBP733 million property exchange deal with fellow FTSE 100 constituent Tesco. Under the terms of the deal, British Land has sold its 50% stake in a joint venture portfolio of 21 standalone food stores to supermarket chain Tesco and has acquired Tesco's 50% interest in two joint venture portfolios, which primarily comprise Tesco-anchored shopping centres and retail parks. As part of the deal, Tesco will get GBP96 million from British Land.
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Royal Dutch Shell said it has completed the sale of its 30% interest in the oil mining lease 18 in Nigeria, along with related facilities in the Eastern Niger Delta, for USD737 million in cash. The FTSE 100-listed oil company said the sale of the licence has been completed through its Shell Petroleum Development Co of Nigeria business and said the 30% interest in the licence has been assigned to Eroton Exploration & Petroleum Co. The divestment is part of the strategic review of Shell Nigeria's operations and is in line with the government of Nigeria's aim to develop Nigerian companies within its upstream oil and gas sector, Shell added.
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Tullow Oil said it has secured an additional USD450 million of capital under its existing credit facilities. Tullow has completed a reserve-based lend redetermination process, which it completes every six months, which led to a USD200 million increase in lenders commitments after a review of the company's assets. This increased the available debt capacity to USD3.7 billion from USD3.5 billion despite lower oil prices, said the company.
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In a first move for any alcohol company, Diageo plans to display calorie counts and other content information on many of its biggest-selling products, including Johnnie Walker Scotch whisky, Smirnoff vodka, Guinness and Tanqueray gin. The world's biggest distiller said Thursday in an e-mailed statement that it will disclose alcoholic content and nutritional information per serving on its responsible drinking website or on product packaging as soon as possible.
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An asthma treatment co-developed by GlaxoSmithKline and Theravance has been found safe and effective by a FDA review panel in treating adults but not adolescents. The FDA panel voted in favour of Breo Ellipta (fluticasone furoate/vilanterol [FF/VI]) as an once-daily inhaled treatment for asthma in patients aged 18 years and older by a 16-4 vote. However, the panel voted against the asthma drug for treating patients aged between 12 and 17 years, with the panel voting 2 for and 18 against.
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Investec said it expects its wealth and asset management divisions' results for its current financial year to beat last year's numbers, bolstered by higher funds under management and billions of pounds of net inflows, although its view on the specialist banking business is mixed. The Anglo-South African specialist bank said that group results for the year ending March 31 have been hurt by the South African rand's 11% depreciation against its sterling reporting currency. The wealth and investment division's results have been helped by net inflows of GBP2.6 billion, while the asset management side has had net inflows of GBP2.4 billion, according to Investec.
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Housebuilder Berkeley Group Holdings said it is continuing to see good demand for new homes in London and the South East, is making progress on its land holdings, and reiterated its earnings guidance for the current financial year, along with the following two. Berkeley said that as trading conditions returned to normal in the housing market, following the highs seen in 2013, it is still seeing good demand for new homes in London and the South East of England. The company is in construction on 64 sites across the two regions and said all of its sites with implementable planning consent are in construction.
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Vedanta Resources said it has cut its 2015 capital expenditure budget by USD400 million and halved its budget for 2016 in order to reach its desired gearing of 25% and to ensure it can maintain a "progressive dividend policy". The mining company said it has slashed its capital expenditure budget for 2015 to USD1.5 billion from the previous USD1.9 billion budget, while its capital expenditure budget for 2016 has been halved to USD1.0 billion from USD2.0 billion. Vedanta is aiming to increase copper equivalent production from its assets by 59% in the near-term.
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FirstGroup said it has agreed a deal with the UK Department for Transport to operate the First Transpennine Express rail franchise for a further year. The transport company said the deal will mean the franchise will operate beyond its current end date of March 31, 2015 to April 1, 2016, in line with the UK government's anticipated start of the new Transpennine Express franchise. FirstGroup said it is shortlisted for the new franchise and intends to submit a bid later in the year.
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The spat between Alliance Trust and Elliott Advisors (UK) escalated, with the disagreement continuing in a very public way. Alliance Trust got the exchange underway on Friday, claiming that the activist investor's "short-term agenda" is a potential threat to its very existence. But Elliott took just a few hours to respond, claiming that Alliance Trust's board is "out of touch" with shareholders' concerns. Karin Forseke, who chairs Alliance Trust, said that Elliott's move to make changes to its board is "completely unacceptable" and advised other shareholders to vote against the proposals. Elliott, which has built up a 12% stake in Alliance Trust, wants the company to appoint former SG Warburg executive Anthony Brooke, ex-CEO of Legal & General Investment Management Peter Chambers, and Rory Macnamara, previously of Morgan Grenfell, to the board of Alliance Trust.
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AIM Movers
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Karelian Diamond Resources, up 53%. The company said it has discovered a potential new diamond source in the Kuhmo region in Finland. Independent Oil & Gas, up 24%. The company said its 48/22c licence area in the North Sea, awarded in the 28th offshore licensing round in the UK, has been increased in size and now contains the Hambleton discovery. The Hambleton prospect was found in 2005 and has base case of recoverable resources of 6 billion cubic feet of gas, the company said. Amphion Innovations, up 16%. The company said its partner company Motif BioSciences has announced its intention to list on London's AIM market. Bond International Software, up 14%. The HR and payroll software company said it has initiated a strategic review and has put itself up for sale as it reported higher pretax profit and revenue and a hiked dividend payout for 2014.

Digital Globe Services, off 51%. The company said it swung to a first-half net loss, citing delays in completion of client mergers and its investment programme. Gulfsands Petroleum, down 11%. The oil and gas exploration and production company said it will need to source USD15 million of new capital to fund its planned operational activities over the forthcoming twelve months or risk losing some of its licenses if it does not complete minimum work commitments on time.
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Top Economics And General
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The UK government outlined a "major package of support" for the oil and gas industry following on from Wednesday's budget, including outlining powers it will give the new authority for the North Sea. On Wednesday, Chancellor George Osborne said he would introduce four measures that would offer GBP1.3 billion of support to the UK oil and gas industry, primarily in the UK North Sea which would lead to production being boosted by 15% before the end of 2020. In addition to the cuts made to the petroleum revenue tax and supplementary tax, investment in seismic for unexplored areas, and the plans to introduce a new "simple" tax allowance, the UK government Friday said it will pass on more powers to the newly established Oil and Gas Authority.
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The UK budget deficit decreased in February from last year, the Office for National Statistics showed. Public sector net borrowing excluding public sector banks declined by GBP 3.5 billion to GBP 6.9 billion in February. It was forecast to fall to GBP 8.4 billion. This decrease in net borrowing was predominantly a result of a fall of GBP 4.1 billion in central government net borrowing.
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A majority of the households in the UK perceived that the value of their houses increased in March, after moderating in the previous month, results of a survey conducted by Knight Frank and Markit Economics showed Friday. The house price sentiment index, or HPSI, rose to 57.5 in March from 56.5 in February. This marked the twenty-fourth consecutive month of the index remaining above 50. A reading above 50 signals a rise in house prices, while a figure below 50 indicates a decline. The overall reading remains well below its record high of 63.2 achieved in May last year.
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Germany's producer prices dropped more-than-expected in February, figures from Destatis showed. The producer price index fell 2.1% year-over-year in February, exceeding economists' expectations for a 2.0% drop. In January, prices had fallen 2.2%, which was the sharpest decline since February 2010, when the prices declined 3.0%. Prices have been falling since August 2013.
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As urged by EU leaders, Greek Prime Minister Alexis Tsipras agreed to submit a list of reforms within days. EU leaders sought more concrete steps on reforms and efforts to overcome the standstill on the aid programme. German Chancellor Angela Merkel, French President Francois Hollande and European Council President Donald Tusk, European Central Bank President Mario Draghi, Eurogroup Chairman Jeroen Dijsselbloem and EU Commission President Jean-Claude Juncker met Greece premier Alexis Tsipras in Brussels. "In the spirit of mutual trust, we are all committed to speed up the work and conclude it as fast as possible," the leaders said in a statement on Friday.
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EU leaders agreed to maintain economic sanctions against Russia until a ceasefire deal for eastern Ukraine is fully implemented - a move not expected before the end of 2015. The measures, which aim to hamper Russian imports and Russian banks' access to European capital markets, are among the most controversial steps taken to influence Moscow's course in Ukraine, as they inflict economic pain not only on Russia but also on the EU. Thursday's decision in Brussels prepares the ground for the EU to extend its economic sanctions beyond July, when they are currently set to start lapsing.
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Afternoon Watchlist (all times in GMT)

12:30 Canada Consumer Price Index
12:30 Canada Retail Sales
14:20 US Fed's Lockhart speech
15:30 US Fed's Evans Speech
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Monday's Key UK Corporate Events

Centamin - Full Year Results
Hydrodec - Full Year Results
Frenkel Topping Group - Full Year Results
SVG Capital - Full Year Results
Finsbury Food Group - Half Year Results
Volution Group - Half Year Results
Telit Communications - Full Year Results
Nanoco Group - Full Year Results
Optimal Payments - Full Year Results
GVC Holdings - Full Year Results
Akers Biosciences - Full Year Results
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Monday's Key Economic Events (all times in GMT)

11:00 UK CBI Industrial Trends Survey
11:00 Germany Bundesbank Monthly Report
11:00 Ireland Retail Sales
12:30 US Chicago Fed National Activity Index
14:00 US FOMC Member Williams speech
15:00 EU Consumer Confidence Preliminary
15:00 US Existing Home Sales
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