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Business and City in Brief

Wednesday 05 January 1994 19:02 EST
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Pounds 1.4bn lifeline for Spanish bank

Spain's leading commercial and savings banks have opened a 300bn pesetas ( pounds 1.4bn) line of emergency short-term credit for Banesto, the beleaguered commercial bank, at the request of the Bank of Spain. Retail depositors have withdrawn more than pta200bn from Banesto since its management was sacked at the end of December.

The Bank of Spain is understood to have guaranteed the funds to allay unease among lenders. Banesto was more than pta500bn in debt in the interbank market by September last year.

Talks deadlocked

Bank creditors of Metallgesellschaft, the troubled metals and environmental technology conglomerate, failed to agree on survival plans at an extraordinary meeting in Frankfurt. Participants said they were unable to reach an accord on debt rescheduling.

Bonus unchanged

Norwich Union, the third-largest life insurance and pensions group in the UK, is maintaining 1994 bonus rates on its policies at last year's levels. It expects to pay out pounds 313m to policyholders in 1994, up from pounds 276m last year.

US orders rise

Factory orders for manufactured goods in the US rose 1.4 per cent in November following a 1.2 per cent rise in October, the Commerce Department said. In the 11 months to November new orders were up 6.1 per cent from a year earlier.

Kmart selling

Kmart Corporation, as part of an effort to strengthen its discount store business, is to sell 20 to 30 per cent stakes in each of its specialty store divisions and take a restructuring charge of dollars 850m. It will sell minority stakes in its Builders Square home improvement centres, a combined Borders and Waldenbooks book stores unit, Sports Authority sporting goods shops and OfficeMax office supply stores.

Laing venture

John Laing, the construction company, is investing pounds 12m in YTL, a Malaysian power generation business with a licence to build two gas turbine stations.

Rugby disposal

Rugby Group, the building materials producer, has disposed of its 100 per cent interest in Vertal, the French glass processor, to Glaverbel of Belgium for pounds 5m cash. The sale has also reduced Rugby's borrowings by an estimated pounds 10m.

Finelist float

Finelist, a distributor of parts to the motor aftermarket, plans to float on the Stock Exchange this spring. It is expected to be valued at about pounds 25m.

Rolls link-up

(First Edition)

Rolls-Royce has formed a joint venture company with the US aerospace group Howmet to refurbish aero-engine components. The business will be based near Tulsa, Oklahoma.

World Markets

New York: A burst of new year buying drove the Dow Jones Industrial Average 14.92 points higher to close at a record 3,798.82.

Tokyo: Buoyed by the yen's weakness on foreign exchange markets, the Nikkei average climbed 413.74 points to 17,783.48 in moderate trade.

Hong Kong: Prices closed slightly lower to end the record-breaking run. The Hang Seng index gave up 33.16 points to 12,167.93.

Sydney: Interest in gold and mining shares pulled the broader market higher. The All Ordinaries gained 19.1 points to 2,193.4.

Bombay: A partial recovery from early losses left the index 18.25 points down at 3,460.77.

Johannesburg: With gold steady and industrials weaker, the index eased two points to 5,086.

Paris: Heavy selling of futures triggered a 14.79-point fall by the CAC-40 index to 2,249.55.

Frankfurt: Blue chips led the market lower. The DAX index surrendered 20.17 to 2,233.41.

Zurich: A third consecutive record close saw the Swiss Performance Index sporting an 8.58- point advance at 1,902.66.

London: Report, page 32.

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