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Saturday, November 21, 2009

Bomb blasts kill four in the Indian state of Assam


The explosions happened in the town of Nalbari, about 70 km (43 miles) from the state capital, Guwahati.

Police said the devices had been placed in a bicycle. At least 10 other people were hurt, reports said.

The police reportedly suspect separatist militants from the United Liberation Front of Assam (Ulfa) carried out the blasts.

China coal mine blast death toll reaches 87

Another 21 miners are missing after the blast at Xinxing pit in Hegang City in Heilongjiang province.

The toll has more than doubled from 42 dead earlier. Some 528 workers were in the mine when the blast hit before dawn on Saturday local time, said Xinhua.

A top official, Vice Premier Zhang Dejiang, has been sent to oversee rescue efforts at the state-owned mine.

President Hu Jintao and Prime Minister Wen Jiabao had also been in contact with rescue workers, state media said.

China's mines are notoriously dangerous. The central government has made improving safety standards a priority, but rules are often ignored in favour of profit.

The blast in the mine, in the region bordering Russia, occurred at 0230 local time on Saturday (1830 GMT on Friday). More than 400 people managed to escape.


Many of the injured were being treated at the Hegang Mining Bureau Hospital, which said all 800 of its medical workers had joined the rescue operation, Xinhua reported.

Rescue official Zhang Fucheng was quoted by Reuters news agency as saying that attempts to reach the 21 trapped miners were being hampered by dense gas and collapsed tunnels.

But a spokesman for the mining company, San Jingguang, said he believed the men were still alive and that rescuing them was the "first priority".

The BBC's Michael Bristow in Beijing says it appears that a build up of gas was the cause of the explosion.
One of the rescued miners, Wang Xingang, said the blast knocked him out briefly.
"When I regained consciousness, I groped my way out in the dark and called for help," Xinhua quoted him as saying.

The mine is operated by the state-owned Heilongjiang Longmei Mining Holding Group and has an annual capacity of 1.45m tonnes of coal, said Xinhua.

The authorities are likely to be concerned that the accident happened in a state-run mine, says our correspondent.

They are generally considered to be safer than private collieries, whose lax safety standards have contributed to a high rate of accidents.

Most incidents are blamed on a failure to follow safety guidelines, often in an attempt to cut costs and meet an increasing demand for fuel.

The Chinese authorities have been trying to deal with the dangers by closing smaller mining operations and forcing local authorities to regulate the industry.

The government closed some 1,000 small mines in a recent safety drive, and says the number of miners killed has been halved as a result.

But miners are still dying at a rate of six a day, and independent labour groups say many accidents are covered up in the drive for profit and coal.

In February, more than 70 workers were killed in an explosion at a mine in Shanxi province.

Friday, November 20, 2009

Macquarie Radio targets 31% revenue hike

Macquarie Radio Network Ltd, which owns Sydney radio stations 2GB and 2CH, says its performance this year has been significantly better than 2008/09 and should lead to full-year earnings growth of 31 per cent.Shares in Macquarie Radio, 73 per cent owned by John Singleton's private company, rose by 14.55 per cent, or eight cents, to close at 63 cents, the highest level since April 8, 2008.

Chairman Russell Tate told the firm's annual general meeting on Friday that earnings before interest, tax, depreciation and amortisation (EBITDA) for 2009/10 should be more than $8.5 million, compared with normalised EBITDA of $6.5 million in the prior year.

"I am very pleased to say that our performance to date in the current financial year and our expectations for the full year are in stark contrast to the disappointments of 2008/09," Mr Tate said.

"I can now give you a trading update for the four months to October 31 and it makes for good reading for shareholders."

Mr Tate said that radio revenue for the four months was six per cent higher than for the corresponding prior period, excluding Olympic revenue in the first quarter of 2008/09.

EBITDA for the four months was up by 5.5 per cent from the year-before period.

"These outstanding results are of course underpinned by the continued ratings dominance of 2GB, in particular," Mr Tate said.

First-half EBITDA was likely to be over $4.5 million and the company expected to declare a fully-franked dividend of three cents per share.

Mr Tate said that 2008/09 had been a disappointing year, as EBITDA fell by 20 per cent.

Net profit slumped 95 per cent to $220,000 and no dividend was declared, after the company paid Alan Jones $4.5 million in cash to secure his long-term services, as his 11.3 million options were cancelled.

Mr Tate said Macquarie Radio would significantly reduce its new media activities and focus on its core radio business.

Holden boss wants states to buy local

The new managing director of Holden has taken aim at State Governments for failing to buy more locally built cars instead of imported models.

Alan Batey told a business lunch in Adelaide that government purchases of locally-built cars are plummeting towards 20-per cent and he wants the trend reversed.

He says the only exceptions are South Australia and Victoria.

"I am going to do everything I can to get ministers, mayors and public servants out of foreign cars and back into local product," Mr Batey said.

The South Australian Treasurer Kevin Foley says he will take the message to next month's Council of Australian Governments Meeting.

"I intend to raise it informally at least and put a bit of pressure on other states to buy more Australian cars."

Mr Batey has also warned that interest rate rises could dampen new cars sales in the year ahead.

JP Morgan to buy ANZ custodian business

ANZ Banking Group Ltd will sell its custodian services business to US Banking giant JP Morgan as the Australian lender moves to focus on its core markets in the Asia Pacific region.

"Custodian Services is increasingly a global scale business and JP Morgan Worldwide Securities Services is ideally placed to service this portfolio of clients with its comprehensive suite of custody and securities products and solutions," ANZ institutional managing director Shayne Elliott said in a statement on Friday.

"This transaction continues the process of refocusing ANZ's Institutional business on our core banking priorities in Australia, New Zealand and Asia."

Sale completion is expected before December 31, subject to regulatory approvals, and will be followed by a progressive transfer of business and staff during 2010.

JP Morgan's securities services business has $US14.9 trillion ($A16.03 trillion) under custody and $US5.1 trillion under administration.

JP Morgan said in a statement that it was taking on more than 100 clients, with $99 billion in assets under custody.

"This acquisition cements our position as one of the leading custodians in Australia and New Zealand," JP Morgan securities services chief executive for Australia and New Zealand Jane Perry said.

"Building on what is already a strong base, JP Morgan will be the only firm in the local market that can offer the full range of custody services, including global, local, sub-custody and fund administration services to domestic and international institutions and fund managers."

The transaction would not include ANZ's securities lending operations.

JP Morgans said the financial terms of the sale would not be disclosed.

Thursday, November 19, 2009

Sims Metal to raise $475m to fund growth

Sims Metal Management Ltd has signalled it is on the lookout for buying opportunities after announcing a $475 million capital raising to fund its growth strategy.

The global metal and electronics recycling company said on Friday the money raised would provide it the "financial flexibility" to pursue a growth agenda.

"Through the capital raising, the company will be in an enviable position to strengthen its existing business and fund acquisition growth opportunities, which will enhance and expand its industry leading position," Sims chief executive Daniel Dienst said in a statement.

The $475 million comprised a $400 million fully underwritten institutional placement at $21 a share and a $75 million non-underwritten share purchase plan.

The institutional placement is at a 5.4 per cent discount to Sims's last traded price of $22.20, before the company entered a trading halt on Friday.

The trading halt was expected to be lifted on November 23.

Eligible shareholders would be able to buy up to $15,000 in shares at a price Sims chief financial officer Rob Larry said would be no greater than the institutional placement price.

Initially, the proceeds would be used to repay debt, which would be redrawn as needed, the company said.

IG Markets research analyst Ben Potter said the capital raising looked positive for Sims at first glance, particularly the small discount to the last traded price.

"Sims has indicated they will look to use the funds to grow the business, with some expectations of future M&A (merger and acquisition) activity," Mr Potter said in a research note.

"With an excellent management team, strong balance sheet and significant growth potential, this could be the catalyst needed to entice fresh money back into the stock, especially given recent sideways trade."

In terms of the outlook for the period ahead, Mr Dienst told shareholders at the company's annual general meeting in Sydney on Friday that ferrous markets had shown signs of "recent firming".

But there was no update to the company's October trading outlook, which said the company expected volatility and a continued challenging operating environment in its second fiscal quarter.

"There has been no material change in markets or the operating performance of the business that would require an update to the 30 October 2009 commentary," Mr Dienst said on Friday.

Sims's acquisitions in 2008/09 included two metals recycling companies, a ferrous metals processor and an electronics scrap recycler.

Moreover, Sims had recently completed acquisitions of two further companies, and bought out its partner at the company's dock facility in Albany, New York state.

Mr Dienst said "opportunity would not be possible without fiscal prudence".

"The financial discipline and conservative business practices that we had in place heading into the global financial crisis allowed us to fare far better than most," Mr Dienst said.

"We are well-positioned to participate in and lead the metal market recovery."

Sims chairman Paul Varello told shareholders they could "take great comfort" from the company's strategy.

"Management's execution of that strategy has positioned your company well to take advantage of the opportunities that will doubtless present themselves as markets inevitably recover," Mr Varello said.

Shareholders voted to approve increasing the cash pool for directors' annual pay by $500,000 to $3 million.

The remuneration report also passed, but not before some shareholders raised concerns about the way the company structured its long-term incentives, particularly the "re-testing" of performance hurdles for the "rights" given to senior executives to buy shares for nil consideration.

Lenders to Macquarie Media

Lenders to Macquarie Media Group's American local newspaper business have agreed not to exercise their rights for breaches of loan covenants in exchange for a fee and a higher interest rate.

Macquarie Media announced in October that American Consolidated Media LLC (ACM) had breached covenants under its $US133.7 million ($A143.8 million) bank facility.

It said on Friday that the US subsidiary had now entered a forbearance agreement with its lenders.

The lenders had agreed not to exercise their rights until January 29, unless a further default occurs on the forbearance agreement, Macquarie Media said in a statement.

ACM will pay its lenders a forbearance fee of 0.25 per cent of the aggregate principal balance of the loans, and a permanent increase in the applicable interest rate of 2.3 percentage points per annum.

A revolving credit facility commitment also will be reduced to $US3 million from $US10 million.

The covenants ACM had breached, and was likely to breach in the near future, included a leverage covenant for the June, September and December quarters.

ACM and its lenders would continue to discuss the lending facility and how it might be restructured or extended, Macquarie Media said.

Macquarie Media also will seek the lenders' consent to its management internalisation proposal.

ACM's borrowings are secured only against ACM itself and its assets. Macquarie Media doesn't provide any guarantees or security in favour of ACM or its lenders.

Macquarie Media also has no plans to inject cash or financially support or guarantee ACM, the company said.