Clothing Website M And M Fashions £80m Sale

By Mark Kleinman, City Editor

The online discount clothing website M and M Direct is to change hands for more than £80m amid a frenzy of deals involving some of the UK's best-known retailers.

Sky News understands that TA Associates, the private equity group which bought M and M in 2007, has appointed bankers from Canaccord Genuity to handle the auction, which is expected to attract significant interest.

Set up in 1987 by Mark Ellis and Martin Churchward to sell end-of-line clearance sports products, the website now sells products from more than 300 brands such as Diesel, New Balance and Nike, and claims to attract nearly one million visitors each week.

TA, which is also trying to sell its interest in the premium lifestyle retailer Cath Kidston, bought M and M from ECI Partners, another investment firm, seven years ago.

It has flirted with a sale of the business before, being stalked by Mike Ashley, the tycoon behind Sports Direct International, in 2011.

News of M and M Direct's plan to sell itself again comes on the same day that Asos, one of the City's most popular internet retailing stocks, delivered one of the most disappointing trading updates in its history.

Shares in Asos plunged by 20% as investors digested the revised profit forecast, while shares in Boohoo, the fashion retailer which listed on London's junior AIM market last week, also fell sharply.

M and M, which sells products at discounts of between 40% and 90% off high street prices, is understood to have had a decent Christmas trading period, although the company has not been without its difficulties.

Accounts filed at Companies House for the 12 months ending February 24 last year reveal that the previous year had been especially troubled.

"The company encountered a number of market and strategic issues which led to [its] turnover decreasing by 4%. A wholesale review of the business was conducted and a new strategic plan has been introduced which, along with new management, has allowed the business to return to profitable growth."

A TA spokesman declined to comment.

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Pension Firms 'Lose Billions' After Speech

Britain's financial service providers have lost billions in value after the Chancellor delivered his Budget for 'savers and pensioners', Sky News has calculated.

By mid-afternoon an estimated £4.5bn had been wiped off the value of the top five UK pension companies listed on the blue chip FTSE 100 index.

The investor exodus occurred after George Osborne announced that defined contribution pension holders are to be offered free, impartial and face-to-face advice.

Mr Osborne added in his speech that pensioners must no longer buy annuities if they do not want to.

Annuities provide a fixed income but cannot be transferred between providers.

Legal & General saw £1.8bn wiped from its market value after shares were 14% down in mid-afternoon trades.

Resolution, which traded at almost 10% down for a while, then dipped to 15% down - equal to losing £800m.

Aviva lost an estimated £900m, Standard Life around £350m and Prudential saw £800m wiped due to negative trades.

Meanwhile, independent financial adviser Hargreaves Lansdown saw its share price up 7.5%.

The annuities market has come under scrutiny in recent month, amid calls for widespread reform.

Aviva chief executive recently told Sky's Jeff Randall Live that the industry did need a shake-up.

The Chancellor also said remaining tax restrictions on pensioners accessing their funds would also be removed.

He added that £20m would be spent within two years working with consumer groups and industry on the pension advice structure.

George Bull, senior tax partner at Baker Tilly said: "For people with defined contribution pension plans, the Budget ushers in the biggest changes seen in the last 25 years.

"From 2015/16 pensioners are to be given greater control of their pension pots.

"Rather than being discouraged from withdrawing money early with a punitive tax charge of 55%, they will be encouraged to do so while paying their personal tax rate.

"'Trust the people' says the Chancellor, and it's clear he does as the increase in the tax yield from people taking their savings early is projected to be £3bn over the next four years."

Bookmakers William Hill and Ladbrokes were also bruised by the Budget, after Mr Osborne said fixed-odds betting terminal duty would rise to 25%.

The machines, many of which are located in high street betting shops, have spread rapidly in the last decade and have been a huge windfall for bookmakers.

Deloitte indirect tax partner Barney Horn said it would cost operators around £80m a year and added: "It will increase operating costs and could lead to further consolidation in the market.

"Online gambling operators are unlikely to be able to pass on the costs to consumers, but could be forced to cut back on marketing and player promotions."

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Unemployment Drops By 63,000 In Last Quarter

The unemployment figure for the three months to January has dropped by 63,000 to 2.33 million.

The Office for National Statistics (ONS) added that the number of people claiming Jobseeker's Allowance last month fell by 34,600 to 1.17 million.

Meanwhile, the ONS said average earnings increased by 1.4% in the year to January, up 0.2% on the previous month.

The latest official data gives the Government a Budget boost, with a record number of people in work.

More than 459,000 are employed compared to a year ago, taking the total to just over 30 million in jobs.

It is the highest figure since records were started in 1971.

The ONS said the jobless rate dropped to 7.2%, with most of the fall being from men.

It added that there was a fall in the number of part-time workers, because they were unable to find full-time jobs.

It said the part-time total was down 32,000 to 1.4 million.

The number of people claiming Jobseeker's Allowance fell by 34,600

Although a reduction was reported, the total is still 41,000 than at the same time in 2013.

Both long-term unemployed and jobless youth figures were down.

The ONS said long-term jobless was down by 38,000 to 828,000, while 912,000 aged 16 to 24 were without work.

The youth figure was down by 29,000.

It said Britons classed as economically inactive fell by 19,000 to 8.9 million.

That figure includes those who have given up looking for work and carers.

The latest data also shows public sector employment on the decline, with a drop of 159,000 to 5.5 million - recorded as the lowest level since 1999.

The big drop was said to include the large numbers of Royal Mail workers now classed as being in the private sector, after the company's flotation last autumn.

Meanwhile, the civil service reduced numbers by 6,000 to 441,000 and local government fell by 25,000 to 2.3 million.

Private sector employment is now 662,000 more than at the same time last year.

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Music Streams Hits $1bn Amid Anti-Piracy Push

Global music sales continue to fall but revenues from streaming and subscription services have topped $1bn (£600m) for the first time.

According to the International Federation of the Phonographic Industry (Ifpi), figures for 2013 show digital streams were up 51% globally.

It said streaming service Spotify now boasts more than 24m users, while established players such as Google and Apple have also launched their own offerings.

However, Ifpi's Digital Music Report 2014 continued the industry's calls for an overhaul of search engine results, which it said can aid online piracy.

"Search engines have pledged to do more to tackle online piracy, but there is still a long way to go," the group said as it released the report in London.

"In August 2012, Google announced that it was altering its algorithm to take account of notices received from rights holders to place infringing sites lower down in search results.

"Unfortunately, this seems to have had little impact.

Ifpi added: "A search for the name of any leading artist followed by the term 'mp3' in the leading search engines still returns a vast proportion of illegal links on the first page of results."

As an example, Ifpi listed the leading five performing artistes from the Billboard 100 and said that copyright infringement pages appeared on searches from Bing, Yahoo! and Google.

Ifpi said that by last January, the global recording industry had sent in total more than 100 million requests to Google to remove links to infringing content.

It said the number of requests would have been higher but Google caps the number of requests on rights groups.

Approached by Sky News, a Google spokesman was unavailable for comment.

Mainstream search engine insiders question the Ifpi methodology, saying they have taken millions of pirated content links off their portals and insist independent evidence does not back-up the piracy-support claims.

Ifpi lambasted Russian social network vKontakte, which it said allowed its 55 million average daily users to upload and share music and video files.

It added that the City of London's Police Intellectual Property Crime Unit (Pipcu), funded by the Intellectual Property Office, has taken a key role in targeting infringement of rights holders.

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Osborne Close To Landmark China Banking Deal

By Mark Kleinman, City Editor

George Osborne is closing in on a landmark deal that would see the City become one of the world's most important offshore centres for trading the Chinese currency.

Sky News understands that the Government hopes to announce by the end of the month the establishment of a London-based clearing bank that would act as a hub for offshore renminbi (RMB) payments.

The move would be significant because of the rapid growth in the volume of international RMB transactions as China's financial system and economy have become less insular.

The Chancellor has made it clear that increasing the City's share of trading in the China's currency represents a vital growth opportunity.

A London-based institution would effectively "oil the wheels" of the clearing process, reducing transaction and settlement costs, a source said.

A number of the country's vast state-owned lenders, including Bank of China and Industrial and Commercial Bank of China, have been vying to be appointed as Beijing's clearing bank in London, according to insiders.

A decision about the chosen institution could be made public within days.

The Treasury is understood to have been hoping to get a deal wrapped up in time for Wednesday's Budget statement, although that was now unlikely, a City source said.

In a speech in Hong Kong last month, Mr Osborne said the UK and China had an economic "two-way relationship of equals".

"Gone are the days when the British finance minister was only interested in securing greater market access to China.

"Now almost two thirds of all RMB payments outside of China and Hong Kong take place in London," he said.

The Chancellor said he was unashamed about having secured agreements establishing a swap line with China's central bank and allowing Chinese banks to apply to set up UK-based wholesale branches.

"Now London firms are able to invest directly in Chinese stocks and shares in RMB - something that's just not currently possible anywhere else in the West - thanks to our agreement with the Chinese Government last year.

"Ultimately what we all want to see is RMB being used more and more as a currency of choice in the world.

"The UK and Chinese Governments are in active discussions about the appointment of a renminbi clearing bank in London."

City sources cautioned that the Prudential Regulation Authority (PRA), the banking oversight arm of the Bank of England, would also need to approve any deal.

The PRA is leading the consultation on rule changes that would mean Chinese banks operating in the UK as branches rather than subsidiaries, effectively entailing lighter-touch regulation by the UK authorities.

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Paddy Power Rapped Over Pistorius Advert

The bookmaker has been heavily criticised for an advertising campaign in which it offered "money off if he walks" in connection with South African athlete Oscar Pistorius, who is on trial for the murder of his girlfriend Reeva Steenkamp.

The Advertising Standards Authority ruled Paddy Power had brought advertising into disrepute over a campaign that drew a record 5,525 complaints - the most complained about UK advert of all time.

The advert, placed in the Sun on Sunday, used an image similar to an Oscar statuette with the face of Pistorius, next to text stating: "It's Oscar Time. Money back if he walks. We will refund all losing bets on the Oscar Pistorius trial if he is found not guilty."

The advert as it appeared in full

Unusually, the ASA ordered the immediate withdrawal of the advert pending its investigation of complaints that it trivialised the issues surrounding a murder trial, the death of a woman, as well as disability.

Others complainants said the ad was likely to cause serious or widespread offence.

In its defence, Paddy Power said "it strongly believed" that its betting offer did not trivialise the issues surrounding the Pistorius case but said that, because of the high level of media coverage of the trial, it was "unsurprising" that complaints had been received.

It insisted its ad was a reflection of public interest, not a commentary on death, violence or disability.

And while it accepted "if he walks" could be ambiguous, it was a play on words and not intended to be offensive.

Paddy Power said it did not intend to offend

The newspaper involved said it did not intend to cause offence to readers, and regretted that it had.

Advertising rules stated that references to anyone who was dead must be handled with particular care.

The ASA said the ad was likely to be interpreted as making light of the issues surrounding the trial, which included the death of a woman who had been shot by her boyfriend.

"We acknowledged that the ad had appeared in the context of a high profile murder trial that had received extensive media coverage and was of interest to the public," the watchdog said.

"We considered it would therefore have been reasonable to foresee that serious or widespread offence was likely to be caused by placing an ad that sought commercial advantage based on that trial and which made light of the sensitive issues involved."

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China's Smog 'Deters Top Foreign Executives'

China's chronic air pollution is now a major reason why foreign executives do not want to work in the country, a survey has found.

A boost in car usage is partially behind the smog problem

According to the American Chamber of Commerce in Beijing (ACC), thick smog that affects many areas is making it difficult for companies to recruit top executives willing to move to Asia.

It said 48% of 365 foreign firms in its annual survey, covering businesses in China's northern cities, said air quality concerns were thwarting the lure of overseas postings senior executives.

The ACC said pollution is "a difficulty in recruiting and retaining senior executive talent".

Chinese parents also fear for the health of their children

It added that the 2014 figure is a leap from the 19% of firms citing smog as a problem in 2010.

But it added China's slowing economy remained the top risk for companies.

Foreign executives and diplomats have voiced increasing concerns about China's pollution.

Off-the-scale smog forces some people to stay indoors

They fear its effects both for themselves and their dependent families.

Almost all Chinese cities monitored for pollution in 2013 failed to meet health standards.

The US embassy in Beijing even has its own monitoring app, which invariably shows higher pollution rates than those issued by the government.

Pilots are to learn how to land through thick smog

Northern China suffers significantly, as it is the industrial base for much of the country's cement and steel production.

Its colder climate also exacerbates the problem, as coal is used for heating.

Beijing is also regularly hit by smog from cars and industry from surrounding areas.

Meanwhile, China's commercial capital Shanghai, in the south, suffers less as a result of air pollution.

The capital Beijing is surrounded by industrial provinces

The ACC's Shanghai branch did not see pollution as a major problem.

Chinese Premier Li Keqiang "declared war" on pollution at the opening of the annual session of parliament earlier this month.

China has also pledged to make 60% of its cities meet national pollution standards by 2020.

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