Thursday newspaper round-up: Cadbury, British Airways, Lloyds

Up to 14 per cent of Cadbury's share register is estimated by brokers to be controlled by hedge funds that are betting Kraft will raise its $16.2bn (£9.8bn) offer for the UK confectioner, increasing the likelihood that its hostile bid will succeed. Brokers predict that towards the end of the bid battle, so-called merger arbitrageurs could own more than a quarter of Cadbury's stock, potentially shifting the outcome of the deal in Kraft's favour, writes the FT.British Airways is closing in on its long-awaited merger with Iberia, the Spanish flag carrier. An announcement could be made as early as Friday, according to Sky News, although sources last night cautioned that any deal could still fall through. British Airways said last night that "talks were continuing", says the Times.BT's rivals could be forced to help to shoulder the telecoms company's huge pension deficit after a review by the regulator. Ofcom will begin an investigation soon into BT's pensions costs, to see whether it should take them into account when billing rivals for using its network, reports the Times. Ian Smith, the chief executive of Reed Elsevier, is stepping down after just eight months in the job with £1.1m in compensation, since his lack of media experience meant it "wasn't the right role" for him. Anthony Habgood, the chairman of the group, told The Daily Telegraph that Mr Smith's background in property rather than the information publishing industry meant he was not the best person to be leading the company during a recession.Lloyds Banking Group said yesterday that it may increase its capital-raising by £1.5 billion to £22.5 billion because of a clamour by investors to take up its offer to swap debt into equity. Investors are flocking to take up Lloyds' offer to convert their tier 1 and tier 2 debt into new "contingent capital" because it will guarantee them an income of possibly 10 per cent or more in an annual coupon, according to the Times.Global gold production is in terminal decline despite record prices and Herculean efforts by mining companies to discover fresh sources of ore in remote spots, according to the world's top producer Barrick Gold. Aaron Regent, president of the Canadian gold giant, said that global output has been falling by roughly 1m ounces a year since the start of the decade. Total mine supply has dropped by 10pc as ore quality erodes, implying that the roaring bull market of the last eight years may have further to run, reports the Telegraph. The Guardian and The Observer newspapers are set to axe up to 10 per cent of their journalists, as the group looks to combat plummeting revenues brought on by the worst advertising recession in living memory. Guardian News & Media Group, which publishes the newspapers, briefed staff yesterday that more than 100 jobs would be cut from its editorial and commercial departments, according to the Independent. Shareholders are protesting that Sir Philip Hampton has taken a non-executive board position at Anglo American in addition to his full-time role as chairman of Royal Bank of Scotland, majority-owned by UK taxpayers. Investors are concerned his new role at the mining group will distract him from steering RBS out of its difficulties, according to the FT.Hewlett-Packard on Wednesday agreed to buy 3Com for $2.7bn in cash, opening the broadest front yet in a competitive war with Cisco Systems. The 3Com purchase would make HP, the top computer maker, number two in the market for networking gear, which is Cisco's core business, reports the FT.Marks & Spencer sparked protests on the streets of London at the start of the decade when it abandoned its stores in countries including Belgium and France ? but as a new decade beckons, it is looking toward the Continent again. The retailer is understood to have enlisted advisers to identify possible locations in Western Europe for its Simply Food outlets, which sell snacks, fresh fruit and vegetables and flowers, writes the Times.Bob Benmosche, the chief executive of American International Group (AIG) claimed on Wednesday night that he remained "totally committed" to the troubled insurer. He dismissed as "speculative" reports that he was on the verge of walking away just four months after joining, the Independent writes.Fritz Henderson, appointed chief executive of General Motors in the spring after 25 years with the company, is coming under intense public pressure from his new boss, chairman Ed Whitacre. Mr Whitacre, a telecoms industry veteran who turned AT&T into the largest carrier in the US, was lured out of retirement to head GM, and his public remarks are being parsed in Detroit for signs about Mr Henderson's long-term future with the company, writes the Independent.