Sunday newspaper round-up: RBS stake sale, Arriva return, IHG deals eyed

The government may begin the process of selling down its 79% stake in Royal Bank of Scotland this week at the behest of Chancellor George Osborne. A sale of a £2.5bn chunk of shares, equivalent to 6% of the company, could begin in the coming days, the Sunday Times said. The Treasury has been targeting a sale price of 502p per share after the bank was bailed out by the taxpayer in 2008, but has accepted it will make a loss. At Friday's closing price of 341p, the government's stake is worth £17.3bn.

Advisers to Osborne have yet to decide whether to recommend to the chancellor that now is the right time to start the RBS sale process, the Observer reported. James Leigh-Pemberton, the head of UK Financial Investments, has told Osborne that at least £2bn of RBS can be sold by April. But in a letter at the time of the July budget he gave no timescale.

The German owners of Arriva, one of the UK's largest bus and train operators, are planning to re-float the company on the London Stock Market for around £4bn. Deutsche Bahn, which snapped up the joint-operator of London Overground, Chiltern Railways and one in five of London's buses for £1.6bn in 2010, has revealed plans for a "partial privatisation", according to the Sunday Times. DB, which has long been mulling a rival service to Eurostar through the Channel Tunnel, is looking at partial disposals of Arriva and its DB Schenker freight rail business, to ease pressure on the German government to sell a chunk of DB, as was mooted last year.

FTSE 100 hotels group InterContinental Hotels Group (IHG) has put together plans to take over luxury hotel rivals Fairmont and Mövenpick following the early collapse of US talks. Having ruled out a merger with Sheraton owner Starwood, IHG is eyeing Canada's Fairmont, manager of the Raffles in Singapore, and Switzerland’s Mövenpick, the Sunday Times reported, despite recently insisting it planned to grow organically. After recently selling several of its large hotels, including in London, New York and Paris and Hong Kong, has been assumed to be drawing up a large special dividend payout. Sources said IHG had “not yet decided” whether to make a bid for either business.

The Athens stock exchange is due to reopen on Monday after almost five weeks, with Greece's embattled banks likely to be in focus. The lenders are in a vulnerable position owing to outflows of billions of euros (dollars) from deposits over the past six months, with some €40bn withdrawn since December, the Sunday Telegraph reported....

...The Observer added that with business confidence shattered by weeks of political chaos, stringent new conditions attached to Greece's potential new bailout, including new austerity measures, shares in Athens are expected to sell off sharply. “The possibility of seeing even a single share rise in tomorrow’s session is almost zero,” said Takis Zamanis, chief trader at Beta Securities.

British Airways, which is part of International Consolidated Airways, has forced the chairman of its pension scheme to resign due to a disagreement over his investment strategy. Paul Spencer, who only is not only the senior trustee of BA's two giant schemes but also those of BT and Rolls-Royce, will leave at the end of August. Senior sources close to the trustees, told the Sunday Times that the split came after a dispute over investment strategy, with Spencer keen to switch the less-well-funded New Airways Pension Scheme (NAPS), the younger the two schemes, into bond investments rather than shares, which may have increased the scheme’s deficit.

Pub giant Punch Taverns is poised to agree the sale of 150 of its worst-performing pubs to AIM-listed property developer NewRiver Retail, mostly for conversion into supermarket convenience stores. The Sunday Times said a £50m deal was close to being reaching for the predominantly 'wet-led' pubs, which do not serve food. NewRiver has completed a similar deals before with 200 pubs bought from Marston's and sold to Co-operative Food.

UK planning constraints should be relaxed to allow more fracking for oil, the head of the British Chambers of Commerce has demanded ahead of the awarding of a new wave of licence awards this month. John Longworth, BCC director general, said
ministers needed to do more to relax planning constraints if Britain is to make the most of fracking and not "end up a living museum", the Mail on Sunday reported.

Steel giant Tata's UK 'long products' boss has been forced to step down ahead of an expected swathe of job cuts at the Indian-owned group's Scunthore steelworks. The long products business, which makes girders, wire and other products for construction and infrastructure projects, is eyeing major cost cuts and the Sunday Times cited sources who said veteran Jon Bolton had been squeezed out and replaced by Tata Steel Europe executive, Bimlendra Jha.

Herefordshire-based crisp maker Tyrrells has agreed the acquisition of Australian peer Yarra Valley Snack Foods as it begins a major push into Asia-Pacific. Tyrrells deal for the Melbourne-based manufacturer is its first deal since it was bought by buyout firm Investcorp for £100m in 2013.

Tesco has lost a second director to bargain fashion chain Matalan in six months, as its commercial director for UK general merchandise was poached last week. Bernadette Lusher, who worked at Marks & Spencer for 30 years before joining Tesco's clothing business in 2011, the Mail on Sunday reported.

Tour operator Audley Travel has been put up for sale by private equity owner Equistone. The firm has hired Rothschild to run a sale process with a sale price of more than £200m expected for the Oxfordshire-based tour operator.