CHITTAGONG, Feb 4: The trend of imports through false declaration has gone up unexpectedly through the Chittagong Port. Chittagong Customs office (CCO) is getting perturbed as a result of detection of tax evasion through false declarations of import consignments.
A consignment of 140 units of Whirlpool freeze was detained by the CCO at port yard No. 5 recently. Bangladesh Electrical Industries Ltd (BEIL), a sister concern of Transcom Group of Dhaka, imported this consignment from India through a foreign vessel-MV Express Resource giving false declaration of spares and appliances of Whirlpoor freeze (CKD) instead of complete product (CBU).
Earlier, the CCO detained a similar consignment comprising 880 units of Whirlpool freeze of the same importer on January 6 last when evasion of import duty of Tk 10 million was attempted. This consignment was detained at container yard No. 5. National Board of Revenue Chairman inspected the duty-evasion tricks of the Transcom Group through visiting the port yard.
Later the CCO issued show cause notice to BEIL asking it to explain the reasons of duty evasion with 15 days, CCO sources said. Before receiving reply of the show-cause notice, the CCO detected another duty-evasion trick of the same importer within the same month.
Meanwhile, the CCO detained three containers consisting of about 1250 bags of contraband PostaDana (special spice item) at port yard recently. Sources said Mysa Trading Co. of Chittagong imported 2100 bags of Postadana in five containers with false declaration of ''mug dal''.
In the meantime about 900 bags of contraband ''posta'' got released from the yard and the CCO seized three containers with approximately 1250 bags acting on secret information, CCO sources said.

Top

The 18th branch of The Premier Bank Limited started its operation in Barisal recently, said a press release.
A large number of clients, patrons, local personalities and businessmen were present at the inauguration ceremony.
A milad mahfil was arranged on the occasion on the branch premises.
Sponsor Director of the bank Arifur Rahman, Managing Director M A Yussouf Khan, Deputy Managing Director Nurul Alam Chowdhury, Business Development Consultant Muhammad Akram Hussain, and former president of Barisal Press Club and editor of local daily Ajker Barta Kazi Nasiruddin Babul spoke on the occasion.
Arifur Rahman said Premier Bank makes continuous efforts to diversify its products and services to meet all types of demands of customers.
He invited the local people to avail the services of Premier Bank.
Managing Director M A Yussouf Khan, in his speech, said Premier Bank is committed to extending its services to major cities of the country.

Top

Qatar Airways, the Doha-based national carrier of the State of Qatar, has signed a pre-delivery financing agreement with Qatar National Bank for its Airbus A380 ''super jumbo'' aircraft valued at approximately $120 million, said a press release.
Qatar Airways is one of the world''s fastest growing airlines serving 48 destinations throughout Europe, Africa, the Middle East and Asia.
The A380 will become Qatar Airways'' flagship aircraft and will continue to offer the airline''s tradition of the ultimate cabin product to its customers.
The A380 will enter service with Qatar Airways in early 2009, and will be deployed on long-haul routes.
The airline''s excellent product as well as the high-efficiency using aircraft closely optimised to the market is expected to sustain its continued rapid growth.
Qatar National Bank is the leading provider of corporate and retail banking services in Qatar through its extensive domestic branch network and internationally through its branches in London and Paris.
The Bank, as a major provider of structured project and aircraft financing, is fully committed to supporting the development and growth of the country''s national carrier.

Top

The repurchase agreement (repo) auction of Tk 3.9665 billion ( 396.65 crore) was held Wednesday.
Commercial banks and financial institutions offered thirteen bids of one-day tenor amounting to Tk 6.159 billion. Bangladesh Bank (BB) accepted thirteen bids of one-day tenor amounting to Tk 3.9665 billion.
The rates of interest against the accepted bids ranged from 4.50 per cent to 5.00 per cent annum.

Top

MARKET ANALYSIS:
The foreign exchange market was moderately active Wednesday because of lower demand for the US dollar. The greenback was, however, steady against the Bangladesh taka in the local interbank market. The dollar was also steady in the local informal market, fund dealers said.
In the informal market, the dol-lar was traded between Tk 57.70 and Tk 58.10 against the Saturday''s range between Tk 57.60 and Tk 58.10. The exchange rate of the Indian rupee against the taka ranged between Tk 1.25 and Tk 1.30, they added.
In the formal interbank market, the ex-change rate of the green-back against the taka varied between Tk 58.83 and Tk 58.90 against the Saturday''s range between Tk 58.83 and Tk 58.92. The dollar in public deals was traded between Tk 57.70 and Tk 59.15, dealers said.
In the regional market, the ex-change rate of the dol-lar against the In-dian rupee mainly varied between Rs 45.34 and Rs 45.36 and that against the Pakistani rupee between Rs 57.30 and Rs 57.32. Besides, the ex-change rate of the dollar against the Malaysian ringgit varied between 3.7995 ringgit and 3.8005 ringgit and against Thai baht between 39.08 baht and 39.11 baht.
In the international market, the exchange rate of the dollar against the Japanese yen mainly varied between 105.74 yen and 105.79 yen and the rate of the euro against the greenback moved between 1.2599 dollar and 1.2602 dollar.
As on February 04, 2004, the Lon-don Interbank Offered Rates (LIBOR) against the US dollar were 1.10000 per cent for one month, 1.12000 per cent for three months, 1.17000 per cent for six months, 1.24000 per cent for nine months and 1.35000 per cent for twelve months, according to American Express Bank.

Top

The interbank call money rate eased Wednesday in a moderately active market. The demand for cash was lower. The upper edge of the call rate, however, moved far above the bank rate. The liquidity improved with the inflow of cash due to repurchase agreement (repo) auction, fund managers said.
The bank rate is 5.00 per cent.
The government earlier borrowed a total of Tk 2.605 billion ( 260.50 crore) Saturday through the auction of treasury bills. On the other hand, Tk 5.527 billion will be injected into the market in the week due to maturity of some treasury bills. It will result in a net inflow of Tk 5.527 billion into the market.
The call rate mainly ranged between 4.00 per cent and 17.00 per cent against the Saturday''s range between 14.00 per cent and 60.00 per cent. Most deals were concluded between 5.00 per cent and 15 per cent.

Top

NEW DELHI, Feb 4 (Reuters): India''s ruling Hindu nationalists announced a series of measures yesterday aimed at helping the ailing sugar and tea sectors in the runup to an early election.
As part of a host of sweeteners offered by Finance Minister Jaswant Singh in the interim budget, the government plans to restructure loans to the sugar industry saddled with huge stocks because of bumper harvests and slow exports.
The government will also prepare a package for the revitalisation of the sugar sector in consultation with industry representatives, mill owners and cane farmers. But it did not give any details.
The sugar industry, which employs about 46 million people, has been unable to pay cane prices to farmers and repay loans taken from banks.
Despite several incentives and a transport subsidy to exporters to move sugar from mills to ports, overseas sales have not picked up.
Singh said the government had finalised a revival package for the ailing tea industry which includes a special loan repayable in five years, with a moratorium of one year, and a 200,000 working capital loan for small growers at 9.0 per cent interest.
The Indian tea industry has been hit by declining exports and falling prices in a market where demand has failed to keep pace with the rise in output.
Parliament will be dissolved this week, but the independent electoral commission has yet to set dates for voting, expected to be staggered between April and May.
Singh also announced cheaper credit for the farm sector, which supports more than 70 per cent of the country''s billion plus population and accounts for 25 per cent of GDP.
He said an existing farm income insurance scheme would be extended and credit rules would be simplified.
The government also promised to expand irrigation facilities in the desert state of Rajasthan and issue credit cards to farmers.
The vegetable oil industry had expected some rationalisation in high edible oil customs duties to help farmers, consumers and the processing sector, but Singh left these duties unchanged.
India, the world''s largest edible oil buyer, charges a 70 per cent customs duty on RBD palm olein, 65 per cent on crude palm oil and 45 percent on refined soybean oil.
The country mainly imports nearly half of it annual consumption of nearly 10 million tonnes from Malaysia, Indonesia, Argentina and Brazil.

Top

WASHINGTON, Feb 4 (Reuters): Treasury Secretary John Snow told Congress yesterday the US economic recovery could falter if lawmakers failed to make permanent the tax cuts President George W. Bush has won since taking office.
"You can''t think of anything more harmful to an economy that''s coming out of the difficulties this economy has had and beginning to show good progress, than a tax increase," Snow said in testimony to the House of Representatives'' Ways and Means Committee.
"It could halt this recovery in its tracks," he said.
A call to make the tax cuts permanent was central to the budget proposal Bush unveiled Monday. Some provisions begin to expire at the end of this year.
Democrats claim the tax cuts, which total some $1.7 trillion over 10 years, were skewed to the wealthy and are unaffordable at a time of record-high budget deficits. All of the major Democratic presidential candidates have called for at least partial repeal.
In testimony focusing on the president''s budget plan, Snow argued that consumers and businesses needed to be assured the tax cuts would not be rolled back.
"The ability of American families and businesses to make financial decisions with confidence determine the future of our economy," he said. "And without permanent relief, incentives upon which they can count, we risk losing the momentum of the recovery and growth that we have experienced in recent months."
Snow credited the tax cuts with putting the U.S. economy on a sustainable growth path and said staying the course was the best way to boost employment.
"The life signs of this economy are all good and that always leads to jobs," he said. "I''m confident we''ll see a nice pick up in jobs in the months ahead.
Democrats have blasted Bush for his economic stewardship, pointing repeatedly to the 2.3 million jobs lost since the president took office.
The president has also taken political heat for large and growing budget deficits, which reflect the tax cuts, higher defense and security spending and lower revenues because of a sluggish economy.
In Bush''s budget plan, the administration forecast a record deficit of $521 billion in the current fiscal year, but projected deficits of less than half that size for budget years 2007-2009. Snow did his best to convince the committee the administration was committed to getting the deficit down.
"Make no mistake; President Bush is serious about the deficit," he said. "We see it as unwelcome, but manageable."
"We can manage this deficit, and we can cut it in half over the next five years by controlling spending and growing our economy," Snow said.
The Treasury chief told the panel "entrenched and large" deficits could push interest rates up, but financial markets appeared comfortable with the administration''s plans.
"If the tax cuts were imprudent, the financial markets would already be registering that in the price they charge for funding the debt of the United States," he said. "So the financial markets are giving us the benefit of the doubt (saying) we will solve the problem."

Top

Singapore''s tourism sector exceeded its stretched target of six million visitor arrivals (VA) for 2003 set in June after the SARS crisis, said a press release.
Despite a tough economic climate aggravated by SARS, war and terrorism, Singapore welcomed a total of 6,125,480 visitors in 2003.
The 19.1 per cent year-on-year drop in VA compared to 2002 was an improvement over the earlier projected decline of 30 per cent. In 2002, 7.6 million visitors came to Singapore.
Since June 2003, Singapore''s tourism sector has seen a strong recovery with a significant narrowing of the year-on-year declines in visitor numbers from 70.7 per cent in May 2003 to +7.9 per cent in November 2003 and -2.7 per cent in December 2003.
Lim Neo Chian, the STB''s deputy chairman and chief executive said: "The six million visitor arrival target was a stretched goal considering the economic challenges and uncertainties which confronted the tourism industry after SARS. Despite that, Singapore saw more than 6.1 million visitors. This achievement is a result of the co-operation and unity of the various industry partners in Singapore and overseas.''''
''''The STB hopes to leverage on the momentum of recovery and continue building on our strong local and regional partnerships to achieve strong, sustainable growth for the tourism industry to become a key economic driver in the coming years.", he added.
In 2003, the STB underwent a major reorganisation. Structured along the lines of eight strategic tourism units (STUs) and seven international regions, the new or-anisation was poised to tap the growth of new business segments and the growing regional markets. With this initiative, the STB''s presence in the region was significantly enhanced and the new STUs of Food & Beverage, Healthcare and Education Services were formed.
De-regulation in tourism industry practices injected more destination vibrancy and enhanced Singapore''s appeal. Key areas of de-regulation included the introduction of the Specialised Tourist Guide scheme, and liberalisation of Singapore''s nightlife and entertainment scene.
At the height of the SARS crisis, after Singapore was -lifted from the World Health Organisation''s (WHO) list of SARS-affected areas, the Board also unveiled a S$200 million global recovery programme to ensure the long-term sustainabie recovery of Singapore''s tourism industry,which was launched on June 18 at Merlion Park included value travel packages, attractive deals from over 300 participating outlets in Singapore and a host of exciting events ranging from arts to sports and entertainment.
In 2003, the first steps were also taken to pro-actively improve service quality. The service quality division, which was set up in February 2003, initiated the opening of a new Singapore visitors centre at Orchard Road and took on a more pro-active stance in dealing with complaints from tourists. These initiatives seek to make a visit to Singapore a truly memorable one. The STB will accelerate these initiatives in the year ahead.
Regional markets, especilly those in the ASEAN region, remain key markets with great potential which the STB will continue to strongly cultivate. In 2003, Regional Offices were opened in Kuala Lumpur and Ho Chi Minh City, bringing the total number of Regional Offices to 17. In the new year, the STB will continue to enhance its presence in the region.
This co-operative approaeh with our ASEAN neighbours has also led to several key initiatives, including a significant liberalisation of the immigration regulatory environment, and enhanced accessibility to Singapore.

Top

Pervez Sajjad spent three years attempting to make wireless broadband service available in Dhaka where no standard Digital Service Line (DSL) service exists. Non line-of-sight wireless infrastructure proved too costly for Sajjad managing director of Ektoo Ltd. Therefore, he turned to Motorola''s Canopy solution and quickly became an authorised Canopy solution provider (ACSP) in Bangladesh, said a press release.
"Motorola provided us key differentiating factors that made my job of deciding on the Canopy products an easy one," said Sajjad. "It required a very low initial investment as well as low expansion costs. It gives high performance and has high bandwidth which allows for a low per megabit cost. It has an outstanding range. It is interference resistant and it brand recognition in Motorola."
Ektoo installed six 5.7GHz Canopy access points strategically centred in Dhaka, giving coverage throughout the city limits and in some neighbouring towns.
"We offer reliable premium bandwidth catering to businesses, cyber cafes and corporate and service provider customers," said Sajjad. "These customers appreciate the high availability of our service delivered via Canopy because the smallest downtime directly impacts their revenue stream. We may have set a record in Dhaka by having zero downtime in three months. People here are used to experiencing internet service outages. Motorola Canopy equipment resolves the vast majority of those problems and our customers recognise that," said Sajjad.
"We were able to supply Ektoo Ltd., a Motorola wireless broadband solution that has proved reliable, scalable and cost effective in a city that has no standard DSL service but is inundated with Internet Service Providers competing for customers," said Dennis Stipati, director of international markets for Motorola Canopy Wireless Broadband group.
Motorola offers wireless broadband products in 2.4GHz, 5.2Hz and 5.7GHz spectrums. Canopy products are deployed in more than 70 countries in six continents.

Top

LONDON, Feb 4 (Reuters): Key members of the Group of Seven richest nations, whose finance ministers meet in Florida later this week, yesterday dampened speculation about any global agreement to arrest the U.S. dollar''s steep decline.
Financial markets, nervous for weeks the Boca Raton meeting Friday and Saturday may agree words or action to buoy the dollar, now reckon lack of consensus will stymie any initiative.
The dollar, down almost nine percent against a basket of world currencies since G7 last met in Dubai in September, hit a three-year low against Japan''s yen on Tuesday and dropped one percent on the euro.’

Top

SINGAPORE, Feb 4 (Reuters): Asian corn buyers are starting to worry they might have to bring in more South American cargoes in the absence of Chinese supplies, since Thailand and India may not have enough to satisfy leading importers.
Although China is yet to announce plans for 2004, officials of China National Cereals, Oils & Foodstuffs Import & Export Corp, the country''s top grain trader, have said China''s 2004 corn sales could come in anywhere between three to four million tonnes, compared with 16 million tonnes in 2003.
Grain traders said this would leave a vacuum for Asian buyers such as South Korea and Malaysia, which together snapped up more than 10 million tonnes of the grain from China in 2003.
Thailand and India, exporting corn for the first time in many years, are pushing sales to take advantage of China''s absence from the world market, but these two nations put together may not have even two million tonnes to offer, traders said.
In addition to that, feed ingredient buyers in countries such as South Korea are hesitating to buy Thai or Indian corn as they were unfamiliar with the quality of the cargoes.
"It''s going to be tough since importers will be forced to turn to South America from April even if prices are high and the freight is on fire," said one Singapore trader.
Another regional trader added: "The fear for the corn market will remain until China decides to change its mind."
A rush for South American soy - as Brazil and Argentina push sales from their record harvests - and anticipated demand for South American corn, which is expected to be available from end-March, are already keeping the freight market on tenterhooks.
Panamax rates for the benchmark U.S. Gulf to Japan route were indicated at $80 a tonne for April, up from $73 a week ago.
"Key buyers are now depending on the United States for large cargoes but might bring in more once the new Argentine and Brazilian corn crops are completely harvested," said one trader.
U.S. corn is currently quoted at about $188-$189 a tonne C&F Southeast Asia and South American corn from the old crop is quoted a couple of dollars higher. But traders are expecting South American prices to ease once the new crop hits the market.
"Buyers are sniffing around for South American supplies but we haven''t seen serious inquiries," said one trader, adding that China was selling corn at $125 a tonne same time last year.
Traders said South Korea may be trying to seal a few optional-origin deals as the uncertainty remains on Chinese corn exports. That would give them a chance to buy cheap cargoes in case China come out with a new export policy.
In one deal last month, South Korea''s Major Feedmill Group bought 105,000 tonnes of optional-origin corn for March shipment, with a price of $152.90 a tonne C&F quoted for Chinese supplies and $10 higher for U.S or South American supplies.
Brazil is headed for a corn harvest of 40.0 million tonnes and Argentine production is seen at 12.5 million tonnes in 2003/04. South Korea was the biggest buyer of Brazilian corn in 2003, taking 912,600 tonnes.

Top

SYDNEY, Feb 4 (Reuters): Australia''s sugar industry, deeply unprofitable at present low world prices, would gain but not be fully rescued by being included in a proposed U.S.-Australian free trade pact, industry leaders said today.
The extent of a pay-off from inclusion in such an accord, currently in final negotiations between Australian and U.S. officials in Washington, would depend on quantities involved and on timing, said Ian Ballantyne, general manager of grower body CANEGROWERS.
He declined further comment, citing the sensitivity of negotiations.
Sugar has emerged as the main sticking point in long-running negotiations over a bilateral free trade accord, with farm exports between two of the world''s largest agricultural traders the main difficulty.
Politically powerful U.S. sugar is heavily protected by quotas and price supports that pay U.S. farmers 18 cents a lb when the domestic prices drop below a base level.
This boosts the U.S. domestic sugar price to presently around 20 U.S. cents a pound, more than three times the world sugar price of around six U.S. cents a lb, near an all time low.
Australian sugar also receives premium prices in the U.S.
"Every (Australian) producer, miller and cane grower is unprofitable at this figure (six cents)," Ballantyne said.
The present New York price equates to about A$180 ($139) a tonne, while the forecast Australian 2004 price is about A$200 a tonne. Ballantyne said break-even was closer to A$250-A$260.
"We will lose a lot of people out of this industry in the next few years," he said.
But a free trade pact with the United States would help.
Australia was not seeking access for particular tonnages of sugar, but wanted freer, broader and more competitive access with less market interventions, Ballantyne said.
Limited by quota, Australia presently exports only 87,000 tonnes of sugar a year to the U.S. - two boatloads - against around 800,000 tonnes in the late 1980s. Ballantyne blamed quotas and protection that encouraged competition by high fructose corn syrup.
Australian and U.S. trade officials, speaking in Washington Tuesday, said they had until the end of this week to strike an agreement, but stumbling blocks remained.
Australia is the world''s third-largest sugar exporter, after Brazil and Thailand, excluding the European Union. Production has been in decline because of a succession of weather problems, including last season''s severe drought.
The latest crush, which ended in December 2003, produced about 4.6 million tonnes of raw sugar from the main state of Queensland, and just under five million tonnes nationally. This compares with 5.7 million tonnes in 1997/98.

Top

BRUSSELS, Feb 4 (Reuters): EU trade chief Pascal Lamy urged developing nations to tell him which trade subsidies the bloc should get rid of as part of global commerce talks where rich nations'' handouts to farmers are a stumbling block.
The European Union has offered to cut export subsidies on goods of interest to poor nations in Africa, the Caribbean and Asia. It has so far had no response. It has faced demands from other farming nations for a phase-out of all export aids.
"Once we have got a list...to cut subsidies to zero, we are ready to negotiate on all of that list and on the date, so no restrictions," Lamy, European commissioner for trade, told a news conference.
He was launching a new online help desk to give information to developing nations which want to export to the EU.
"It is an open offer so sugar and tobacco can be on that list, but we do need to have that list," he added in response to a question whether sugar, of interest to several nations, including major exporter Brazil, would be included.
The export aid row is part of demands on the EU, as well as other big farm subsidisers the United States and Japan, to do more to help the world trade talks by showing more willingness to reduce their handouts to the agricultural sector.
On subsidies overall, the EU has said it is ready to negotiate on handouts which most distort trade, but cannot ruin its farms and the rural way of life by getting rid of all aid.
Lamy said the help desk the Commission was setting up to help companies from developing nations to ship to the EU would provide explanations on customs duties, documents, rules of origin and trade statistics.

Top

HANOI, Feb 4 (Reuters): Thin supply and rising buying interest pushed up rice prices in Vietnam, the world''s second-largest exporter of the grain, traders said today.
They said the harvest of the key winter-spring rice crop started this week and is expected to peak in mid-February. Until then, supply would be scant as exporters scramble to purchase for February and March contract deliveries.
"Most exporters are not taking contracts for April as they can''t guarantee the supplies, even for March," said a trader with a foreign firm in Ho Chi Minh City.
A prolonged drought in northern Vietnam, which is not the country''s key rice growing area, in the last month has threatened to damage rice and other crops.
Traders expected rice prices to remain firm even after the peaking of the winter-spring crop harvest as the government would stock rice for emergency relief in the provinces affected by the drought. The shortage of the grain has driven up export quotations of Vietnam''s high-quality five percent broken rice to between $197-$198 a tonne, FOB Saigon Port.
The indicative offers for the 25 percent broken rice firmed to $178-$180 a tonne from $174-$175 a week ago, but traders said few deals were struck.
The ministry of agriculture and rural development said rice exports in January declined nearly 60 percent from a year earlier to 76,000 tonnes, which traders said were mainly under government contracts, state media reported.
Vietnam has targeted 3.5 million tonnes of rice exports this year, down from nearly 3.9 million tonnes shipped in 2003.
On Wednesday, five vessels at Saigon Port were loading a combined 69,700 tonnes of the five percent, 15 percent and 25 percent grades for Iraq, Cuba and Japan.

Top

KUALA LUMPUR, Feb 4 (Reuters): Malaysia''s exports surged 35.7 percent in December from a year earlier, topping economists'' forecasts on record demand from its biggest market, the United States, and higher shipments to China.
"They beat even the most optimistic forecasts, they were really strong," IDEAglobal.com economist Paul Schymyck said, adding the data may spark fresh speculation of a change to Malaysia''s fixed currency regime.
"This could fuel more talk of a review of the ringgit peg. One of the reasons given for not removing it is that Malaysian exports have lagged others."
Neighbouring Singapore''s non-oil exports in December were up 30.7 percent from a year earlier, with growth of more than 30 percent also seen in Thailand and South Korea.
A Reuters poll this week estimated Malaysian export growth at 17.9 percent versus the 7.4 percent figure recorded for the year through November.
Imports in December were up 36.2 percent from a year earlier, according to preliminary data released on Wednesday by the Ministry of International Trade and Industry.
Malaysia''s trade surplus hit 6.13 billion ringgit ($1.6 billion) in December, down 2.9 percent from 6.31 billion in November.
Electrical and electronic goods, which account for just over half of total exports, rose 13.7 percent to 20.20 billion ringgit in December.
Exports to the United States rose 22.3 percent to a record 7.02 million ringgit in December from a month earlier, accounting for a fifth of Malaysia''s total exports.
China, Malaysia''s third single largest market, took 2.82 billion ringgit of Malaysian goods, up 15 percent from November.

Top

PARIS:L''Oréal and its two major shareholders Nestlé and the Bettencourt family, have agreed to dissolve the holding company that controls the cosmetics group in a move that will simplify L''Oreal''s capital structure and increase its financial flexibility.
The re-organisation of L''Oréal''s capital structure comes days after the cosmetics group agreed to back Sanofi-Synthélabo''s hostile bid for Aventis, a rival pharmaceutical group. This bid would leave L''Oréal with a smaller and more liquid stake in the new company.
L''Oréal until now has been controlled by Gesparal, a holding company which owns 53.8 per cent of the capital and 71.7 per cent of the voting rights of the French company. Gesparal in turn is 51 per cent owned by Liliane Bettencourt, heiress of the founding family, and 49 per cent by Nestlé.
Under the new arrangement, Bettencourt will own 27.5 per cent of L''Oréal and Nestlé 26.4 per cent - directly in line with their implicit economic interests.
Gesparal will also forgo its double voting rights in a shareholder friendly move that will be closely watched in continental Europe.
The move is significant in that it will free Lindsay Owen-Jones, L''Oréal''s chief executive, from an important constraint on his financial flexibility. L''Oréal''s ability to issue new shares to finance acquisitions had been hampered by Gesparal''s desire to own more than 50 per cent.
It will also increase speculation that L''Oréal will soon be looking for acquisitions to prop up its growth rate. L''Oreal is set to deconsolidate its 19.5 per cent stake in Sanofi Synthélabo, assuming the bid for Aventis is successful. This will have a double-digit dilutive effect on the cosmetic group''s earnings.
French accounting standards require that a company can only be treated as an associate if it has a significant controlling influence, which is assumed only to exist with ownership of more than 20 per cent of a company''s voting rights.
L''Oréal will be left with about 10 per cent of the capital of the new French national champion in the pharmaceutical sector, which it could more easily transform into cash for acquisitions, bankers close to the group said.
Owen-Jones said the transaction with Gesparal would have no impact on its results as the holding company had no debt and no other assets apart from its L''Oréal stake.
The Bettencourt family and Nestlé have pledged to keep their shares in L''Oreal for five years, except in the event of a takeover bid.

Top

NAIROBI, Feb 4 (Reuters): Kenyan tea prices firmed at Tuesday''s auction as buyers stocked up on premium and poorer qualities of the commodity, anticipating a reduction in availability, traders said.
Quantities at the auction are expected to get lower as the weather is expected become drier. Tea production increases with high rainfall. The first quarter of the year is usually dry although the past few days have had rainfall.
"What is very apparent is that the best quality is selling very well but the difference with the lower end of the market is not much. It means buyers are becoming less discriminating," an official at the Africa Tea Brokers (ATB) said.

Top

Citibank NA arranged a seminar on Treasury Management recently at its Chittagong branch office.
It was aimed to discuss importance of treasury management from a corporate perspective, said a press release.
The seminar was attended by executives from the bank''s major export and import clients in Chittagong.
Bashar M Tareq, country treasurer, and Sajed ul Islam, manager, Treasury Sales, conducted the session.
Among others, Khawza Masum Billah, resident vice president of the bank''s corporate banking group in Chittagong, was also present.
The seminar was arranged in line with the bank''s increased focus on its Chittagong clients.
Citibank, the world''s number one foreign exchange bank for over the last two decades, has been delivering its unparalleled foreign exchange service in Bangladesh since 1995.
The bank is equipped with state of the art London orderbook, online trading, position management, MIS and communication platforms in the country.

Top

A training programme on Production of Carbonated Soft Drink (CSD) Plastic Closure, under the joint sponsorship of Fullytop S A, Luxemburg and Padma Group of Companies, Dhaka, was held recently on the factory premises of Padma Cans & Closures Ltd at Savar, said a press release.
A total of 16 officers and employees of Padma Cans & Closures Ltd participated in the training programme.
The programme was presided over by Managing Director of Padma Group of Companies Mainul Huq Khan.
The training programme was conducted by Technical Consultant of Fullytop SA, Luxemburg Michel Gauthey.

Top