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Sat, Nov 29, 2008 - Page 10 News List

World Business Quick Take



UK to hold major RBS stake

The Royal Bank of Scotland (RBS) said yesterday that the British government would end up with a 57.9 percent stake in the bank after a share issue to raise funds to help it cope with the financial crisis. RBS said that ordinary shareholders had agreed to take up only 0.24 percent of the share issue, with the government then taking up the balance, as provided for in its recapitalization plan for the British banking system. Last week, shareholders approved plans to raise £20 billion (US$29.5 billion) in fresh capital as part of a state rescue deal for Britain’s banking sector. Under the plan, RBS was to raise £5 billion directly from the government in return for preference shares.


Q4 revenue to miss goals

STMicroelectronics NV, Europe’s largest semiconductor maker, said fourth-quarter revenue and gross margin will miss forecasts after a slowdown in demand from the wireless, automotive and computer peripherals industries. Sales will be US$2.2 billion to US$2.35 billion, down 13 percent to 18 percent from US$2.7 billion in the previous quarter, the company said in a statement yesterday. The company had predicted sales being unchanged or falling 8 percent. The gross margin will be about 38 percent, down from a forecast of 38.8 percent, both allowing moves of plus or minus 1 percentage point. STMicroelectronics will cut output further to adjust to lower demand and reduce sourcing from third-party contractors. Because of the increased idle capacity, the Geneva-based company’s gross margin will be lower than anticipated on Oct. 28.


Drug firms block generics

Drug companies are delaying or blocking the entry of cheaper generic medicines in Europe, pushing up bills for taxpayers and reducing the incentive for innovation, an EU report said yesterday. EU Competition Commissioner Neelie Kroes said preliminary results of a probe showed competition in the pharmaceuticals industry did not work as well as it should. Practices such as multiple patent applications for the same drug, litigation and settlement deals delayed generics going on sale, the EU executive said. Based on a sample of medicines facing patent expiry in 17 EU states, the EU executive estimated that delays in getting those generics on the market had cost healthcare providers some 3 billion euros (US$3.9 billion) between 2000 and last year.


FSC plans more job cuts

Fujitsu Siemens Computers Holdings (FSC) plans to slash around 700 jobs in Germany — 12 percent of its workforce in the country, it said on Thursday. FSC is Europe’s biggest maker of personal computers and employs about 10,500 worldwide, most of whom are in Germany. It said the job cuts were not a result of its new ownership structure but rather a move to improve profitability and competitiveness. Management began talks with union representatives about the plans on Thursday, it said


Chinese-made plane tested

China tested its first home-made commercial airliner yesterday, with the pilots praising the handling of the Advanced Regional Jet for the 21st Century (ARJ21), the China News Service said. The one-hour maiden flight of the ARJ21 took place in Shanghai, the report said. The maiden flight, which did not rise above 900m in altitude, had been expected earlier this year, the report said. So far only six ARJ21 have been produced, it said.

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