■AUTOMOBILES
VW to raise US$5.7bn
Volkswagen (VW), Europe’s biggest automaker, could raise fresh capital of up to 4 billion euros (US$5.7 billion) to finance the takeover of its main shareholder Porsche, the Financial Times said yesterday. On Thursday, VW said it would take control of the sports car icon after a lengthy battle for which of the two companies, linked by strong controlling family ties, would come out on top of a new group aiming to challenge Toyota to be the world’s No. 1 auto company. Porsche ended up with 10 billion euros of debt as it built up a controlling stake in VW and this cost ultimately weakened its own position. The Financial Times said VW wanted to buy Porsche’s sports car business as fast as possible and so was considering strengthening its capital base to do so. Raising fresh funds for the Porsche takeover, estimated to cost 8 billion euros, will protect VW’s credit ratings, the report said.
■FINANCE
UK to step up scrutiny
Up to 2,000 traders and managers could face extra checks and interviews by Britain’s financial watchdog to assess if they are fit for their jobs following the financial crisis, the Financial Times (FT) said yesterday. Traders, bankers and managers with significant influence in their companies are set to face the tests, the daily said. They include senior professionals at the largest 40 to 50 banks, insurers and other institutions supervised by the Financial Services Authority (FSA), the FT said, citing unnamed sources. The FSA was expected to announce yesterday that institutions would have up to six months to identify senior officials who carry out roles that might expose their company to significant risk, or who exert significant influence.
■FINANCE
Net outflows drop: Aberdeen
British fund manager Aberdeen Asset Management said yesterday net outflows of client money slowed in the third quarter, signaling a “strong” pipeline of new business. Redemptions from funds totalled £2.2 billion (US$3.64 billion) at the end of June after hitting £4.23 billion at the end of March “We have a strong new business pipeline in equities, fixed income and property,” chief executive Martin Gilbert said. Assets under management at the end of the quarter grew to £129.2 billion from £96.3 billion at end-March, boosted by the acquisition of £35.3 billion in assets through the purchase of Credit Suisse’s UK business. Market gains added another £9 billion to assets in the quarter. The fixed income business saw outflows slow sharply during the quarter to a net £2.71 billion, against outflows of £4.23 billion in the previous quarter, helped by outperformance in the company’s funds.
■AVIATION
Virgin Blue to raise capital
Australian budget airline Virgin Blue yesterday announced plans to raise A$231.4 million (US$190 million) in capital as it predicted record losses following the toughest 12 months in its history. The discount carrier also said chief executive Brett Godfrey would step down next year, a decade after launching Australia’s second-largest airline. Godfrey said the fund-raising would improve the airline’s liquidity and financial flexibility, giving it the ability to move into new routes and buy more aircraft when conditions improve. He said in the volatile aviation market the move was “prudent” for Virgin Blue, which is expected to post net losses of between A$160 million and A$165 million in the year to June, a sharp turnaround from last year’s A$98 million profit.
NO-LIMITS PARTNERSHIP: ‘The bottom line’ is that if the US were to have a conflict with China or Russia it would likely open up a second front with the other, a US senator said Beijing and Moscow could cooperate in a conflict over Taiwan, the top US intelligence chief told the US Senate this week. “We see China and Russia, for the first time, exercising together in relation to Taiwan and recognizing that this is a place where China definitely wants Russia to be working with them, and we see no reason why they wouldn’t,” US Director of National Intelligence Avril Haines told a US Senate Committee on Armed Services hearing on Thursday. US Senator Mike Rounds asked Haines about such a potential scenario. He also asked US Defense Intelligence Agency Director Lieutenant General Jeffrey Kruse
INSPIRING: Taiwan has been a model in the Asia-Pacific region with its democratic transition, free and fair elections and open society, the vice president-elect said Taiwan can play a leadership role in the Asia-Pacific region, vice president-elect Hsiao Bi-khim (蕭美琴) told a forum in Taipei yesterday, highlighting the nation’s resilience in the face of geopolitical challenges. “Not only can Taiwan help, but Taiwan can lead ... not only can Taiwan play a leadership role, but Taiwan’s leadership is important to the world,” Hsiao told the annual forum hosted by the Center for Asia-Pacific Resilience and Innovation think tank. Hsiao thanked Taiwan’s international friends for their long-term support, citing the example of US President Joe Biden last month signing into law a bill to provide aid to Taiwan,
China’s intrusive and territorial claims in the Indo-Pacific region are “illegal, coercive, aggressive and deceptive,” new US Indo-Pacific Commander Admiral Samuel Paparo said on Friday, adding that he would continue working with allies and partners to keep the area free and open. Paparo made the remarks at a change-of-command ceremony at Joint Base Pearl Harbor-Hickam in Hawaii, where he took over the command from Admiral John Aquilino. “Our world faces a complex problem set in the troubling actions of the People’s Republic of China [PRC] and its rapid buildup of forces. We must be ready to answer the PRC’s increasingly intrusive and
STATE OF THE NATION: The legislature should invite the president to deliver an address every year, the TPP said, adding that Lai should also have to answer legislators’ questions The Chinese Nationalist Party (KMT) yesterday proposed inviting president-elect William Lai (賴清德) to make a historic first state of the nation address at the legislature following his inauguration on May 20. Lai is expected to face many domestic and international challenges, and should clarify his intended policies with the public’s representatives, KMT caucus secretary-general Hung Meng-kai (洪孟楷) said when making the proposal at a meeting of the legislature’s Procedure Committee. The committee voted to add the item to the agenda for Friday, along with another similar proposal put forward by the Taiwan People’s Party (TPP). The invitation is in line with Article 15-2