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Apple Sued By Greenlight To Unlock Cash Pile

Written By Unknown on Minggu, 10 Februari 2013 | 00.02

An influential investor in Apple has filed a law suit against the company in an attempt to unlock some of its $137bn (£87bn) cash pile.

David Einhorn, the head of hedge fund Greenlight Capital, demanded Apple hand investors more of its cash, which makes up nearly a third of its stock market value.

It comes ahead of the company's annual meeting, where Apple's board is likely to be questioned about its falling share price.

Although still the most valuable company in the world, Apple is facing increasing competition in the smartphone and tablet markets from rivals like Samsung.

Its once rapid growth has slowed and its stock has fallen around by 35% in value since its record-high in September.

Mr Einhorn, who filed a lawsuit at the US District Court in Manhattan, is opposed to a move by Apple that would make it more difficult to issue preferred stock.

Currently, the board is able to issue preferred stock but it wants shareholders to vote on a proposal that would require shareholder approval first.

David Einhorn, President of Greenlight Capital, speaks at 6th Annual New York Value Investing Congress in New York City David Einhorn once called for the chief executive of Microsoft to step down

The hedge fund manager, who has a history of criticising companies publicly, urged fellow investors to reject the plan.

"Apple has $145 per share of cash on its balance sheet. As a shareholder, this is your money," Mr Einhorn said in a letter to the company.

In response, Apple said the lawsuit over the proposal was misguided.

"Contrary to Greenlight's statements, adoption of Proposal #2 would not prevent the issuance of preferred stock," it said in a statement.

The company insisted its management team and board had been in "active discussions" about returning cash to shareholders.

Apple began to be conservative with its cash following its near-collapse in the 1990s, before founder Steve Jobs returned to the company.

It has never explained its reasons for holding onto the cash other than to say its preserving its options.

But analysts expect it to come under further pressure from shareholders at the annual meeting on February 27 to start releasing some more of its money.


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Chinese Data Boosts Economic Recovery Hopes

China's first official data of the year has shown signs of economic recovery, as exports, imports and new lending soared.

Exports in January were up by 25% compared to a year earlier at $187bn (£119bn), and imports surged by over 28% to $158bn (£100bn).

These pushed the resulting trade surplus up by more than 7% to $29bn (£18.5bn) - well beyond market expectations.

Economist Zhang Zhiwei, from Nomura International, said the figures were good news for China's recovery.

"These data suggest that external and domestic demand are both strong, which supports our view that the economy is on track for a cyclical recovery in the first half," he said.

Moody's economist Alaistair Chan added: "Seeing the underlying trend is a little difficult. Nevertheless, the data were above expectations and seem generally positive."

There was also good news from China's banking sector, as new lending more than doubled, compared with December, to 1.07trn yuan ($109bn).

It comes as inflation slowed to 2% in January - down from a seven-month peak of 2.5% in December.

But economists warned against focussing too much on last month's data, as it did not include the Lunar New Year holidays - which fell during January in 2012.

The Chinese government is seeking to boost growth after the country expanded at its slowest rate for 13 years in 2012.

China experienced seven straight quarters of slowing growth, but it picked up in the fourth quarter.

Its central bank cut interest rates twice last year and reduced the amount banks must keep in reserve in an attempt to encourage lending and stimulate growth.


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British Albums Enjoy Record-Breaking US Sales

UK musicians had a record-breaking year in the American charts in 2012, according to figures from the British Phonographic Industry (BPI).

British acts took a 13.7% share of stateside album sales, up from 11.7% the year before, recording four of the top five best-selling albums.

Adele, Mumford & Sons and two albums by One Direction racked up the highest sales, with Ed Sheeran, Muse and The Wanted also shifting big numbers.

The only US artist to make it into the top five list for 2012 was Taylor Swift, with her album Red.

For London-born Adele the past two years have been nothing short of spectacular.

Her second record, 21, has been the best-selling album for two years running in America and has now sold 10 million copies on the other side of the Atlantic (4.4m of those in 2012).

The singer is currently in LA preparing for her performance of Skyfall at this month's Oscars, where the Bond theme is nominated for best original song.

Boy band One Direction also have plenty to smile about after 2012 saw them become the first British group to have their first two albums debut at number one on the US Billboard chart.

BPI chief executive Geoff Taylor called the UK success "a new British invasion" and said it was an exciting time for the homegrown record industry.

"British labels are discovering unique talent and using social media to help build fanbases right around the world, in particular in the US where fans have such an affinity for British music.

"Increasing our share of the US market for three years in a row is an encouraging sign for the future," said Mr Taylor.

The BPI, the trade body for the British record industry, first started recording UK album sales in America in 2003.


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Dreamliner: Airlines Warned Of Delay Risk

Boeing 787 Dreamliner Timeline

Updated: 2:01pm UK, Friday 08 February 2013

The turbulent history of the Boeing 787 Dreamliner:

Feb 8, 2013: Boeing confirms it has sent letters to airlines expecting imminent deliveries of possible delays.

Feb 7, 2013: US Federal Aviation Administration (FAA) allows limited test flight of the grounded Dreamliner.

Feb 5, 2013: Japanese official reveal CT scans of failed batteries does not reveal fire cause.

Feb 4, 2013: Boeing requests FAA approval for test flights of grounded model.

Jan 30, 2013: Amid revenue loss forecasts of $500m to $5bn, Boeing CEO addresses investors and downplays impact.

Jan 28, 2013: Investigators widen battery examination to sub-contractors of lithium ion battery maker GS Yuasa

Jan 21, 2013: Safety officials start probe of lithium ion battery maker GS Yuasa

Jan 19, 2013: Boeing says it is stopping deliveries of the Dreamliner to airlines

Jan 18, 2013: FAA officials arrive in Japan to examine a 787 and its melted battery pack after an All Nippon Air (ANA) emergency landing two days earlier

Jan 17, 2013: The European Aviation Safety Agency,  FAA and Qatar Airways ground Dreamliners under their regulatory control

Jan 16, 2013: Japan Air Lines Co Ltd (JAL) follows suit and suspends Dreamliner flights from Japan over safety concerns

Jan 16, 2013: ANA grounds all 17 of its 787s after four of its aircraft suffer problems

Jan 16, 2013: ANA 787 Dreamliner makes emergency landing in Takamatsu, Japan, after smoke appears in cabin

Jan 11, 2013: The Federal Aviation Authority announces a review of the 787 design and systems

Jan 11, 2013: ANA discovers engine oil leak after a domestic flight lands at Miyazaki

Jan 11, 2013: A separate ANA flight to Matsuyama reported a crack appearing in the pilot's window

Jan 9, 2013: ANA cancels a Boeing 787 Dreamliner flight due to a brake problem

Jan 8, 2013: Japan Air Lines (JAL) grounds a jet at Boston Logan International Airport after a 787 leaks 150 litres of fuel

Jan 7, 2013: A fire erupts in a battery pack in another JAL Dreamliner at Boston

Dec 13, 2012: Qatar Airways grounds one of its Dreamliners because of a faulty generator

Dec 5, 2012: The FAA orders inspections of all 787 Dreamliners in service in the US

Dec 4, 2012: A United Airlines 787 is forced to make an emergency landing in New Orleans after a generator fails

July 23, 2012: ANA grounds five Dreamliners due to an engine component issue

Feb 22, 2012: Boeing says around 55 Dreamliners may be affected by a flaw in the fuselage

Oct 26, 2011: The Dreamliner makes its maiden flight with paying passengers on board an ANA jet

Sep 26, 2011: Boeing delivers its first 787 Dreamliner to Japan's ANA, three years late

Jun 23, 2010: Boeing postpones the first flight of the Dreamliner because of a structural flaw

Dec 15, 2009: The passenger jet 787 Dreamliner takes off on its maiden test flight

Apr 9, 2008: Boeing says there will be a revised plan for the first 787 flight and initial deliveries

Dec 11, 2008: Boeing announces further delays due to strike action by machinists Sept-Nov

Oct 19, 2007: Boeing says there will be a six-month delay to deliveries due to assembly issues

Jul 8, 2007: The first assembled 787 goes on display to media, employees and customers

Jul 18, 2006: Boeing says it is making "solid progress" on the 787 Dreamliner programme

Jan 28, 2005: Boeing gives its new commercial airplane an official model designation number - 787

Jan 29, 2003: Boeing announces the launch of a new aircraft called the 7E7


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HMV's Boss Made Redundant: Sky Sources

HMV: The Stores To Close

Updated: 10:42am UK, Thursday 07 February 2013

The 66 stores identified for closure are:

Ashton-under-Lyne, Ballymena, Barnsley, Bayswater, Belfast Boucher Road, Belfast Forestside, Bexleyheath, Birkenhead, Birmingham Fort, Blackburn, Boston, Bournemouth Castlepoint, Bracknell, Burton-upon-Trent, Camberley, Chesterfield, Coleraine, Craigavon, Croydon Centrale, Derry, Dumfries, Durham, Edinburgh Fort, Edinburgh Gyle Centre, Edinburgh Ocean, Edinburgh Princes Street, Edinburgh St James, Falkirk, Fulham, Glasgow – Fort, Glasgow – Silverburn, Glasgow Braehead, Huddersfield, Kirkcaldy, Leamington Spa, Leeds White Rose, Lisburn, Loughborough, Luton, Manchester 90, Moorgate, Newry, Newtonabbey, Orpington, Rochdale, Scunthorpe, South Shields, Speke Park, St Albans, St Helens, Stockton-on-Tees, Tamworth, Teesside, Telford, Trocadero, Wakefield, Walsall, Walton-on-Thames, Wandsworth, Warrington, Watford, Wellingborough, Wigan, Wood Green, Workington, Wrexham.


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McDonald's Global Sales Fall Again

Sales in January at established McDonald's restaurants around the world fell 1.9%, which was more than analysts expected.

A rise of almost 1% in the US failed to compensate for sliding sales elsewhere.

In Europe, sales fell by 2.1%, as the eurozone's debt crisis continued to hit consumer spending in Germany and France especially.

Sales slumped by 9.5% in the region that encompasses Asia, the Middle East and Africa.

McDonald's cited a weakness in demand in Japan as one of the causes, as customers increasingly choose to eat at home.

In China the company has suffered from supply chain problems, and said 2013's later New Year had hit sales.

It is only the second time in nine years that McDonald's has reported a fall in monthly sales - the last being in October 2012.

The figures come amid intensifying competition in the fast food sector from rivals like Subway and Burger King.

They have taken on rival McDonald's - which dominated the sector for decades - by rolling out their own versions of products like premium milkshakes and wraps.

The company's president and chief executive Don Thompson said McDonald's is focussed on meeting the needs of all of its customers.

"While January's results reflect today's challenging environment and difficult prior year comparisons, I am confident that our unwavering commitment to delivering an exceptional restaurant experience will enhance our brand's relevance and drive long-term results," he said.

Last month the company warned it was expecting a negative sales figure for January, and said growth would remain under pressure in the near future.

McDonald's sales figures take into account restaurants open at least 13 months, removing any volatility as a result of newly opened and closed locations.


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Lloyds Eyes Branches Float Amid Co-op Doubts

By Mark Kleinman, City Editor

Millions of high street bank customers face further uncertainty amid growing concern that a takeover of more than 630 branches by the Co-operative Group will be abandoned.

I have learnt that Lloyds Banking Group, which is 41%-owned by UK taxpayers, is stepping up plans for a flotation of the branches despite having agreed an £800m sale to the Co-op last year.

The move has been triggered by doubts about the ability of the two sides to complete the deal, according to people familiar with the discussions between the two banks.

One insider said this week that the Co-op was in active talks with the Financial Services Authority (FSA) about a string of issues related to the deal, one of which was about the capital position of its banking division.

"There has been no change in the tone of the discussions with the regulator," a person close to the talks said.

Codenamed Project Verde, the 632-branch network has to be sold in return for the state aid required to rescue Lloyds at the height of the 2008 banking crisis.

If the deal does collapse, it would be the second-such abandonment following Santander UK's withdrawal from a deal to acquire more than 300 branches from Royal Bank of Scotland (RBS) late last year.

People close to Lloyds insisted that its preferred option remained the deal with the Co-op but conceded that it was accelerating preparations for a demerger of the Verde business onto the public markets.

In a statement on Friday, a Lloyds spokesman said: "We are continuing negotiations with Co-op and are making good progress in creating a stand-alone challenger bank. We expect to have a separate TSB branded bank on the UK high street from the summer."

The Co-op is likely to provide an update on the Verde talks when it announces annual results at the end of March.

A collapse of the deal would be an embarrassment to George Osborne, the Chancellor, who has hailed the takeover by the Co-op as an important step towards fostering greater competition in Britain's high street banking market.

The Verde network has well over three million customers and a market share that would alone make it Britain's seventh-biggest bank.

Growing pressure on UK lenders to bolster their capital positions from the new Financial Policy Committee of the Bank of England has, however, placed greater focus on the structure of the Verde deal, according to people close to it.

The Co-op declined to comment.


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EU Leaders Agree Historic Budget Deal

EU Budget: A Classic Compromise

Updated: 6:21pm UK, Friday 08 February 2013

Accounting sleight of hand has been used to secure the approval of member states, while the EU institutions grumble on the sidelines.

Germany hailed a "good and important" deal, for Spain it was "good news", while Italy declared the deal to be "satisfactory".

For David Cameron the negotiations, which see the budget reduced for the first time in 56 years, were a "success" but must not be "oversold".

So smiles all round, because few "red lines" were crossed.

That made it an extremely difficult task for European Council president Herman van Rompuy.

He had to make convincing cuts to the EU's seven year budget ceiling, while protecting rebates, the common agricultural policy, structural and cohesion funds (designed to give a helping hand to struggling regions) and try to boost projects aimed at plumping growth.

The negotiators were left with little wiggle room - so a programme called "Connecting Europe" got it in the neck.

That is a 50bn euro project designed to finance large-scale infrastructure projects across the union from motorways to digital highways. Its grant was slashed by a quarter.

That, together with a cut to plans to kickstart investment in poorer areas of the EU, was met with howls of outrage from the European Parliament which, under the Lisbon treaty revision, can now reject the package and send it back to the Council.

The Parliament's president Martin Schulz said the gap between the commitment ceiling (the money which can be promised to fund future projects) and the payment figure (the EU's actual credit card limit) is too high.

He warns there is a blocking majority - but as MEPs will vote on the financial framework in a secret ballot, will they really want to start the whole process again with elections looming in 2014?

But this is where the two limits help: budget hawks (UK, the Netherlands, Sweden and Germany) can say they have kept actual spending down, while the countries arguing for more financial assistance can say they limited the hit on spending commitments.

A win-win for many member states; although not in the eyes of many those in the Commission or the Parliament, who see cuts to growth and infrastructure projects as an attack on the EU's core purpose.

The political issue for David Cameron is that he appears to have made good on his promise to achieve at least real-terms freeze.

But that of course does not necessarily translate into a better deal for the British taxpayer, who will still have to fork out more cash as the EU expands east, with poorer countries needing more financial assistance.

At the post deal news conference, he said the net contributions will rise, but by less than had been feared.

This is not because we are generous to a fault. The argument runs that by putting more cash in their pockets of Europe's poorest, it benefits everyone in the single market.

But for the 27 leaders, this constitutes a box ticked. No messy annual budget rollovers and an end to the protracted negotiations which have tied up the so-called sherpas and their number crunchers for months.

It frees them up to concentrate on the even thornier issue of rescuing the single currency.


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Horsemeat: Schools And Hospitals To Be Tested

Meals in schools and hospitals will be tested for horsemeat as part of a nationwide probe into processed beef products, the Environment Secretary has told Sky News.

Speaking ahead of an emergency summit with food producers, supermarkets and health officials, Owen Paterson, when asked if it was likely that school and hospital meals contained horsemeat, said: "We will be testing those as well, alongside products in retailers."

The Government has been unable to guarantee that state-provided food does not contain horsemeat.

The talks came as the retailer Aldi confirmed some of its ready meals contained 100% horsemeat, while Findus has admitted that it knew its products were affected more than a week ago.

Mr Paterson told Sky News that horsemeat in food labelled as beef-products was "completely, totally unacceptable".

He said he was "determined to get to the bottom" of the matter and to see if "it is gross incompetence or a serious criminal conspiracy".

The Environment Secretary added that "retailers are ultimately responsible for what they sell".

The Food Standards Agency (FSA) also attended the meeting on Saturday. It has ordered all British retailers and processors to test all their processed beef products to make sure they are what they say they are within a week.

Mr Paterson said they would examine how the existing system works and how horsemeat got into the food network at the summit.

Paterson to hold horse meat summit Environment Secretary Owen Paterson is holding emergency talks

Shadow environment secretary Mary Creagh told Sky News Labour hoped the meeting would produce "some clarity from Government about what consumers should be doing and whether the Government's testing regime was going to work".

She added that, according to the food industry, the testing regime put in place by ministers was "completely unworkable".

With only six laboratories in the UK that can do the necessary DNA tests, testing hundreds of product lines in every supermarket would not be possible, she warned.

Meanwhile, the Aldi supermarket chain has confirmed that two of its ready meal ranges produced by Comigel, the French supplier also used by Findus, were found to contain between 30% and 100% horse meat.

The dishes affected are Today's Special frozen beef lasagne and Today's Special frozen spaghetti Bolognese.

The company said it felt "angry and let down" by Comigel and that anyone who had bought the affected products was entitled to a full refund.

Comigel, the company at the centre of the latest scare, whose headquarters are based in Luxembourg, has told the AFP news agency that the horsemeat originated in a Romanian abattoir.

The meat was supplied to Comigel by a meat-processing company called Spanghero, based in southwestern France.

The scandal has spread across continental Europe, with Findus withdrawing various frozen meals from both France and Sweden.

Swedish firm Findus has also pledged to sue an unidentified party over the matter, saying it was "deceived". 

Speaking from Luxembourg, Sky News Home Affairs Correspondent Mark White said authorities now faced a "complex and very difficult investigative process" to trace the contaminated meat.

Findus. Testing of Findus beef lasagne showed some contained 100% horsemeat

He said authorities had acknowledged that the meat may have come from more than one source.

"The French and the Luxembourg authorities say they have traced the contaminated meat to a supplier in France, but it's not as simple as that.

"They say there are multiple other suppliers into this French company and tracing them back to the source is proving much more problematic."

Politicians and food safety experts have played down the risk to human health, with Prime Minister David Cameron saying it was not about food safety, but about accurate food labelling.

He said the industry would have to work hard to restore consumer confidence.

Meanwhile, Labour MP Tom Watson has published a letter on his website which he claims was sent by Findus to retailers on Monday, warning that a France-based supplier had told it there may be problems with raw materials delivered since August 1 last year.

In it, the firm claimed raw materials delivered to a French contractor since August 1 were "likely to be non-conform and consequently the labelling on finished products is incorrect".

The letter added: "The supplier has asked us to withdraw the raw material batches."

Responding to the claims, Findus said they did not know about problems back in August and that they first suspected an issue on January 22, when they ordered the initial tests.

The product recall was ordered on February 2 after further tests had been conducted.

In a statement the company said they were only made aware of a possible August 2012 date through a letter dated February 2 this year, by which time it was "already conducting a full supply chain traceability review and had pro-actively initiated DNA testing".

Findus said it had not been invited to the Government summit but they were aware that the Food and Drink Federation, of which they are a member, was attending.


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Google's Eric Schmidt In Big Share Sell-Off

Google's Executive Chairman Eric Schmidt plans to sell roughly 42% of his stake in the internet company over the next year.

The 57-year-old will get rid of 3.2 million shares which - if sold at current prices - would mean a $2.5bn (£1.58bn) windfall.

The plan was revealed in a stock trading plan filed with the US Securities and Exchange Commission.

It allows Schmidt, who was also Google's CEO until 2011, to spread the sale over one year to reduce the effect on its share price.

The documents reveal that he owns "approximately 7.6 million shares of Class A and Class B common stock" - a 2.3% overall stake in the company.

After the sale Schmidt would still be left with stock worth another $3.5bn (£2.2bn).

A Google spokeswoman would not comment on the sale, but Schmidt has been gradually reducing his stake in recent times.

In February 2012, he filed another one-year plan to offload another 2.4 million shares.

Schmidt is currently ranked 138 on the Forbes list of global billionaires with a net worth of $7.5bn (£4.75bn)

He passed the reins of the world's biggest search provider to Larry Page in April 2011.

Page and his co-founder, Sergey Brin, are the only people who own more of Google than Schmidt, each having about an 8.5% share.

There is speculation that the sale could be part of a move by Schmidt to 'diversify' his interests.

He recently went on a controversial "personal" trip to North Korea where he urged the secretive state to allow its people access to the internet.

And last week he also grabbed headlines by claiming that China runs the most "prolific and sophisticated" computer hacking operation in the world.


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