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Top story
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Mandelson: RDAs have big role to play in recovery
Business minister Peter Mandelson told a high-level group of North West business leaders at the Lowry Centre at Salford Quays this morning that local councils and regional development agencies can work with business to aid the economy, but warned quangos and initiatives not to overlap. “You have to make sure the array of regional, subregional and local bodies, and partnerships add clear value and don’t translate into a lack of coherence and a diversion of energy,” he said. Speaking on the day the Cabinet are meeting in Liverpool, Mandelson also listened to business concerns from the group including the lack of bank funding for regeneration schemes, where investment from banks has dried up. He encouraged local council leaders – Sir Richard Leese of Manchester and Susan Williams of Trafford were present - to work on a tax-efficient scheme for local authority mortgages. Other issues Mandelson jotted down on his yellow pad included support for the car industry, public sector efficiency, payment terms, Manchester’s transport improvements and tax breaks for founders of technology businesses.
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Deals
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Lawrence Hunt expands its Spar franchise
A £1.25m cash injection has allowed Preston-based Lawrence Hunt & Co to expand its growing retail portfolio with the opening of a new store in Lancaster. The store is on the site of a former petrol station on the A6 and will be staffed by a team of 20. The family-run franchise business now runs 27 Spar shops across the North West and employs more than 500 people. Funding for the venture was provided by The Co-operative Bank’s Lancashire Corporate Banking Centre.
Wire sold to communications rival
Wire Communications, an independent business-to-business telecoms provider based in Warrington, has been acquired by Midlands rival Phonebox for an undisclosed sum. Wire’s founder Claire Daniels will become a business manager for Hampton-in-Arden-based Phonebox and be responsible for managing and growing the North West client list. Wire’s staff and offices will also operate alongside Phonebox’s five existing offices. Phonebox said the deal was “accelerated by the current economic climate” as smaller dealerships seek to align themselves with a “greater market force”.
Games companies secure funding
Five games companies in the region have secured £10,000 of funding after successfully pitching their ideas at a workshop organised by creative and digital media organisation Northwest Vision and Media. The companies – Bollington-based The Game Creators, UCAN TV of Manchester and Catalyst, Citrus Suite and Onteca, all based in Liverpool – have three months to develop their ideas before pitching them again to executives at Sony in the hope of selling their ideas to the industry. The Get In The Game workshop was launched to help independent games companies learn what practices should be employed when trying to sell a game idea.
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Business
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Rates cut to 1.5 per cent
Interest rates have been cut by 0.5 per cent to 1.5 per cent as the Monetary Policy Committee looks to further support the UK economy through recession. The cut means that rates are at their lowest level since the Bank of England was founded in 1964. Chris Fletcher, deputy chief executive at Greater Manchester Chamber, said: “It was absolutely right that the Bank should cut rates again this month. However, a rate cut on its own is not enough, it has to be passed on by lenders, as well as easing access to finance. The other slightly worrying element is that the interest rate ‘ammunition’ for tackling the economy is rapidly running out so it is imperative that this is not the only action that is taken; it has to be one of a series of coordinated measures.”
New £35m start-up fund announced
Local authorities are being encouraged to top up funding for a new Business Start Up programme announced today by business secretary Lord Mandelson. The scheme, to be run by Business Link Northwest, will support start-ups through specialist advisers who will provide support, advice and training. The funding for the programme includes £26.6m from the Northwest Regional Development Agency (NWDA) and £8.4m from the European Regional Development Fund (ERDF) - a total of £35m over five years from April 2009. Local authorities can also add to the programme by coming forward with extra funding, Mandelson said.
Losses announced at Daily Sport owner
Sport Media Group, the publisher of the Sunday and Daily Sport newspapers based in Manchester, has reported an £18.2m pre-tax loss in its preliminary results for the year to 31 July as it continues to negotiate its banking facilities following a breach of one of its banking covenants. The company is in discussions with existing finance providers and exploring alternative financing sources and expects to find a solution before a two-month extension to the current facility expires on 6 March. Sport Media has also taken a goodwill impairment charge of £20.7m relating to the whole business, including its photographic and film rights and database licences. The company reported a 7 per cent rise in its pre-exceptional pre-tax profits to £6m and its shares were down 31 per cent this morning.
Trading still poor for Loanmakers
Manchester-based Loanmakers has warned of a significant downturn in its trading performance. The loan broking company, which last year reported interim losses of £1.6m before tax compared with profits of £346,000, said it was unlikely to see any improvement in the second half of the financial year. Its board of directors also expressed disappointment that a recently proposed £1.86m underwritten open offer was rejected by shareholders as this represented an opportunity to inject capital into the business. The company is still reviewing its funding arrangements.
Board change at Styles & Wood
Styles & Wood has appointed Jim Martin as non-executive chairman. The company, which provides design and project management service to retailers, has five outlets across the UK including Altrincham. He joins the board after two years as senior independent director of the company and chairman of its audit committee. He is also non-executive chairman of A J Bell and The Christie NHS Foundation Trust.
Counting the cost of West Coast woes
The problems on the West Coast mainline over the past three days may have cost businesses £38m, according to the British Chamber of Commerce (BCC). BCC director-general David Frost said: “There is no excuse for the huge amount of chaos this rushed upgrade to the West Coast Mainline has caused travellers.” The work on the mainline that links the North West to London and the South East has cost Network Rail £9bn. There have been three problems with overhead power lines since the weekend at Watford, Bletchley and Wembley.
Guilford takes FPB chair
Noel Guilford has taken over as chairman of the Forum for Private Business (FPB), the Knutsford-based national small business lobbyist. A former regional chairman of the Institute of Directors, Guilford has been acting chairman of the FPB since June 2008 and is managing partner of Chester-based accountancy and management consultancy Guilford Consulting.
Recession boosts long-hours culture
There are 466,000 people in the North West working unpaid overtime, according to a report by the TUC released this morning. The average amount of overtime per person stands at six hours and 42 minutes, which would cost employers £4,484 a year per person and have a total cost to the region of more than £2bn. TUC general secretary Brendan Barber said that “while some of this is due to the long-hours culture that still dogs too many British workplaces, the recession will now be making many people scared of losing their job in the year ahead and joining the ever-growing dole-queue”.
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Property
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Funds cut losses in Spinningfields disposals
Two buildings at Manchester’s prime office location Spinningfields have changed hands for a total of £78m. German property fund Hansa Invest has bought 2 Hardman Street, the building occupied by Deloitte and Guardian Media Group, for £56.7m from Legal & General, which paid £86m for the building in 2006. In a separate deal, BP Pension Fund has bought 4 Hardman Square, occupied by Grant Thornton and HSBC, from Aviva Investors Property Fund for £21m. In October 2006 Aviva paid just under £140m for the building along with its larger neighbour 3 Hardman Square, home to Halliwells. It disposed of the Halliwells building for £95m in early 2008 to German fund CS Euroreal.
Two sign up at Lyntown
Two new occupiers have been secured at Lyntown Trading Estate in Eccles. Coultons Bread and FP & S Parts have signed ten-year leases at £4.25 per sq ft and will occupy 10,608 sq ft and 5,188 sq ft respectively. Joint agents Matthews & Goodman and Davies Harrison acted on behalf of landlord La Salle Investment Management.
Cumbrian site remains on blocks
Midlands developer Port Haverigg Associates has said it will not develop the 40,000 sq ft former Haverigg Tannery site until a regeneration masterplan is drawn up by the Millom and Haverigg Economic Development Group (MHEDG) and Copeland Borough Council. Port Haverigg Associates, led by care homes entrepreneur Gary Hartland, said the site isn’t big enough to accommodate its plans, although any expansion could involve the relocation of several small businesses. Both the council and MHEDG say they have no immediate plans for the site.
Care home work set to start
Work is set to start on a £1m specialist care home in Ulverston that will provide support for six disabled adults with autism. The home is being funded by Cumbria County Council and NHS Cumbria and is being developed in partnership with Impact Housing. It’s hoped that construction work on the building will be completed in the autumn.
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And finally...
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New Insider out this week
The January 2009 issue of Insider features the North West Top 500 companies, an invaluable reference tool for the year ahead. Michael Taylor interviews Stuart Chambers, the globe-trotting chief executive of Nippon Sheet Glass, the Japanese glass giant that took over Pilkington, while the region’s lawyers are ranked and we catch up with anti-TIF figurehead and leader of Trafford Council Susan Williams.
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