News Column

UK MIDDAY BRIEFING: Bank Of Georgia Mulls Special Dividends

September 5, 2014



LONDON (Alliance News) -Bank of Georgia Holdings shares rose Friday after the company revealed that it will consider one-off special dividends in light of potential asset sales over the coming years, while it is also targeting initial public offerings for two of its business divisions.



The FTSE 250-listed company said it said it expects to continue to scale up in its insurance and healthcare business division by acquiring hospitals, and is aiming to spin it off in an IPO during 2015. The company is also targeting an IPO for its affordable housing business - in which it is aiming for an internal rate of return of about 40% - as a fund in 2016/2017.



It additionally is pllaning to divest JSC Bank of Georgia's non-core subsidiary in Belarus, BNB, within the next two years.



The stock leads the gainers on the FTSE 250 as we head into afternoon trading, up 3.8% at 2,592.00 pence per share.



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Markets: The major UK stock indices are trading a little lower Friday, as investors weigh-up the impact of the stimulus measures announced by the ECB on Thursday and wait for the monthly US jobs report due later.



The US futures indicate a lower open on Wall Street. In the previous session, stocks turned lower over the course of the trading day. The Dow edged down 0.1%, the Nasdaq slipped 0.2% and the S&P 500 dipped 0.2%.



FTSE 100: down 0.5% at 6,840.50

FTSE 250: down 0.4% at 15,938.09

AIM ALL-SHARE: flat at 777.67

GBP-USD: flat at 1.6315

EUR-USD: up at 1.2958

GOLD: up at USD1,264.29 an ounce

OIL (Brent): up at USD102.12 a barrel

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Other Top UK Corporate News

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Tullow Oil said it has agreed to sell some of its gas assets in the Netherlands to a subsidiary of Mercuria Energy Group Ltd for EUR62.7 million, part of its strategy to sell its North Sea gas assets so that it can focus on conventional light oil. In a statement, the company said it is selling it operated and non-operated L12/L15 block interests and non-operated Q4 and Q5 block interests by selling its Tullow Netherlands BV subsidiary to Mercuria Energy subsidiary AU Energy BV.

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Royal Dutch Shell's chief executive has said he would be prepared to see the company shrink in size if that will boost returns to investors, the Wall Street Journal reported. Speaking in an interview with the paper, Ben van Beurden said he would not set production-growth targets for the oil group and would consider cutting the company's exposure to oil products. He said he would instead focus on ensuring Shell is generating sufficient cash to maintain its dividend growth.

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BP late Thursday said it will immediately appeal a ruling by a US court stating that it had acted with gross negligence in the lead-up to the 2010 Gulf of Mexico oil spill. US District Judge Carl Barbier ruled that the company was grossly negligent, and that the company's activities at the Macondo well amounted to wilful misconduct. However, BP said it "strongly disagrees" with the decision, and believes that the ruling is not supported by the evidence at trial. "The law is clear that proving gross negligence is a very high bar that was not met in this case," the company said in a statement. The court has not yet ruled on the penalty to BP, or the number of barrels spilled. However the ruling could just under quadruple the fine enforced on the company under the Clean Water Act.

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Smith & Nephew has agreed to pay a USD11.3 million fine to settle allegations that it sold the US government devices it claimed were made in the US, but actually came from Malaysia, Reuters reported late Thursday. The settlement was filed Wednesday, ending a whistle-blower lawsuit brought in 2008 by former Smith & Nephew information technology manager Samuel Cox, the report said.

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Barclays said it will partner with Hitachi Europe on the launch of the Barclays Biometric Reader, which will allow customers to access their online bank accounts and authorise payments by scanning their finger. The reader will use Hitachi's Finger Vein Authentication Technology and is set to be made available to Barclays Corporate Banking clients from 2015. The device is able to read and verify unique vein patterns in the finger and is designed to help combat identify fraud experienced by businesses in the UK. The bank said it would not hold the user's vein pattern and said there would be no public record of it.

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The new chief executive of Tesco has signaled he will shake-up the management team at the embattled retailer as he attempts to take it back to its core values. Speaking in a video posted on Tesco's YouTube page, Dave Lewis said part of the changes he intends to make will impact top executives at the company. "Will there be changes? Let's be honest, there has to be. We don't want the trends affecting our business to carry on. If I need to, I will change things. I will make those calls," he said.

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AIM MOVERS

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Shares in Premier African Minerals have dropped after the company said it has adopted a phased implementation strategy of work programmes at the RHA Tungsten project in Zimbabwe, with production targeted for the first-half of 2015 and the estimate of potential early revenue from the site at up to GBP7.3 million. Boxhill Technologiesis also down after shares that were issued after a loan it had was converted into shares started trading. A total of 28.8 million new shares were issued.

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Top Economics And General

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Nearly half of Britons surveyed by the Bank of England expect an interest rate hike in the next 12 months, the strongest outcome in more than three years. The Bank of England/GfK NOP Inflation Attitudes Survey for August revealed that 49% of respondents expected the central bank to hike its record low interest rate over the next 12 months. That was the highest ratio since the 55% logged in May 2011. In May this year, the share of those expecting a rate hike in a year was 42%. The survey, held between August 7 and 15 among 2016 people, showed that the expected rate of inflation over the coming year was 2.8% versus 2.6% in May. Inflation expectations for two years climbed to 2.8% from 2.5% and the five-year expected figure rose to 3.4% from 2.9%.

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The eurozone economy stalled in the second quarter as estimated earlier as investments and inventories declined and state spending eased, latest figures from Eurostat showed. Gross domestic product remained flat from the first quarter, when the economy expanded 0.2%. That was in line with the initial estimates. Investments declined 0.3% from the first quarter, deducting 0.1 points from the GDP change. Falling inventories cut 0.2 points from the GDP change. Meanwhile, growth in private consumption and exports added 0.2 points each. Slower growth in public spending contributed nothing to GDP in the second quarter. Year-on-year, GDP increased 0.7% in the second quarter, after a 1% expansion in the previous three months.

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German industrial production grew the most since early 2012 in July, exceeding economists' expectations, data from Destatis showed. The seasonally adjusted industrial production increased 1.9% from June, when output grew a revised 0.4%. Economists had forecast production growth of 0.4% following the original 0.3% gain in June. The latest growth in industrial production was the strongest since March 2012, when production increased 2.2%. Production grew for a second straight month in July, after declining for three months.

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A leading indicator of economic activity in Japan continued to increase in July, though at a less than expected rate, preliminary figures from Cabinet Office showed. The leading index rose to 106.5 in July from 105.9 in June, when it had risen for the first time in five months. Economists had expected the index to rise to 107.1.

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A fly-over by the air forces of Britain and eight other NATO allies prefaced the second and final day of talks on the world's hotspots by alliance leaders gathered in Wales. After watching formations of Typhoons, Mirages and Eurofighters fly over Celtic Manor, the leaders retreated to seek a common response to the pressing challenges presented by Russia and Iraq. The first session of Friday's talks was focussing on NATO's relationship with Russia in the wake of the crisis in eastern Ukraine. NATO leaders were then scheduled to discuss the dangers posed by Islamist terrorists in Iraq and Syria, as well as ways of boosting funding for the 28-strong alliance.

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Talks between the Ukrainian government and pro-Russian separatists on achieving a political settlement to months of fighting were due to get underway in Belarus. Hours before the negotiations were set to begin, heavy fighting took place in the south-eastern city of Mariupol, where reports said government troops were fending off attacks from rebel forces. Ukrainian officials say that the attack on Mariupol, which is more than 100 kilometres south of the rebel stronghold of Donetsk, is backed by regular Russian troops. Russia denies that it has any troops on Ukrainian soil. Despite the fighting, expectations were high that a ceasefire could be agreed during the talks in Minsk.

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The Iraqi military launched an offensive near Mosul, the northern stronghold of the Islamic State, as NATO leaders have been discussing the need for an alliance to counter the widening insurgency. The Iraqi security forces were backed by Shiite militias in their large-scale assault on Mosul, which the Islamic State has held since June. The military was first attempting to liberate the towns of Khazer and Bartla that are located east of Mosul, Iraq's second-largest city, a security official said, according to independent site Alsumaria News. No casualties were reported.

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Afternoon Watchlist (all times British Summer Time)



13:30 US Labor Force Participation Rate

13:30 US Nonfarm Payrolls

13:30 US Unemployment Rate

15:15 US Philadelphia Fed's Plosser speech



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Monday's Key UK Corporate Events



Associated British Foods Trading Statement

Dechra Pharma Full Year Results



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Monday's Key Economic Events (all times British Summer Time)



All Day China Mid-Autumn Festival

00:50 Japan Bank lending

00:50 Japan Current Account

00:50 Japan Gross Domestic Product

00:50 Japan Tertiary Industry Index

03:00 China Trade Balance

06:00 Japan Eco Watchers Survey

07:00 Germany Current Account

09:30 EU Sentix Investor Confidence

16:30 US 3-Month Bill Auction

16:30 US 6-Month Bill Auction

20:00 US Consumer Credit Change



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Contact: +44 203 668 7440; newsroom@alliancenews.com; @AllNewsTeam






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Source: Alliance News


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