Lastminute Owner Eyes Sale Of UK Dotcom Icon

By Mark Kleinman, City Editor

Lastminute.com, one of the icons of the original dotcom boom, is being put up for sale nearly a decade after its takeover by an American technology giant.

Sky News has learnt that Sabre Holdings, which is listed in New York, is exploring plans to offload Lastminute.

Sabre has appointed bankers at Houlihan Lokey, an advisory firm, to oversee an auction, and has already begun sounding out potential buyers.

A sale of Lastminute could still be aborted if the terms of a deal are not sufficiently attractive to Sabre, but sources said on Saturday that the US company was prepared to accept a substantial loss on the roughly £600m it paid in 2005.

Prospective buyers could include private equity firms or rival online travel groups such as Expedia.

Sabre has itself listed on the public markets, floating on Nasdaq in April with a valuation of nearly $4bn.

It has four main divisions, with Lastminute operating as a subsidiary of Travelocity, Sabre's group of travel e-commerce businesses.

Lastminute was one of the darlings of the early UK internet industry, floating in 2000 two years after being founded by Brent Hoberman and Martha - now Baroness - Lane Fox.

However, Lastminute's performance has been underwhelming, despite it continuing to spend substantial sums on marketing and advertising.

Its biggest market shares are in the UK and France but it has struggled to make an impact elsewhere in Europe.

Analysts say that Travelocity failed to integrate Lastminute effectively or to build the network of hotels or other partners to which it has access during a period when some rivals have expanded aggressively.

Mr Hoberman has also criticised Sabre's exploitation of the Lastminute brand, calling it "an under-utilized asset" last year.

A Sabre spokeswoman said in a statement: "We are always reviewing options to make our technology company as successful, relevant and innovative as possible.

"If we have news to share, we commit to doing so quickly and transparently."

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EU Compensates Farmers Over Russia Sanctions

The European Commission has pledged £100m to assist fruit and vegetable producers hit by Russia's ban on EU food imports.

The money will come from the reformed Common Agricultural Policy, which includes an emergency reserve to compensate for market disruption.

The ban, which Russia imposed earlier this month, coincided with the harvesting season.

It has led to a supply glut in the 28-nation union which is weighing on prices and causing losses for producers.

The Commission aims to compensate producers who decide not to harvest some of their goods or give products away for free.

Russia is the main export market for many EU fruits and vegetables, especially those from the Continent.

Last week the Commission said it would compensate nectarine and peach producers for 10% of their crop.

The new plan expands funding to a much wider level, and includes producers of peppers, pears, grapes, tomatoes and cucumbers.

Moscow has banned imports in retaliation for EU and US sanctions against Russia introduced over what the West sees as Russia's destabilisation of Ukraine.

Meanwhile, despite rhetoric from the EU against Russia, at least one EU state has now admitted the bloc and Nato are not in a position to give military support to Ukrainian troops fighting pro-Russian separatists in the east of the country.

"That is of course not possible," Finland's Prime Minister Alexander Stubb said.

"We know that Nato only gives military help to its members, while the EU does not have the capacity to give this type of support."

On Monday, Russia's central bank also announced it would intervene less in the foreign exchange market to support the ruble as it works toward letting the currency float freely by the end of the year.

Moscow also said all outstanding questions about a 280-truck convoy of humanitarian aid had now been resolved, however a delivery date for the goods is still not certain.

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Fracking Activists In Sticky Whitehall Protest

Anti-fracking campaigners have super-glued themselves to the entrance of a Whitehall department demanding full disclosure over the controversial drilling technique.

The protesters from Reclaim the Power and No Dash For Gas said the demonstration at the Department for Environment, Food and Rural Affairs (Defra) was in response to the release of a Government report last week.

They said the report has 63 redactions on the potential impacts of shale gas exploration on rural communities.

One demonstrator climbed the Government building and unfurled a banner

Two activists, who were locked together, glued themselves to the main entrance at Defra, while another activist climbed the building and unfurled a banner reading: "What's to hide Defra? - Don't frack with our future."

A Metropolitan Police spokesman said officers were called to the scene at 7.30am.

The campaigners claim deleted sections in the report include analysis around falling house prices and failing rural services.

They say the chapter examining the effect of drilling on house prices had three sections cut.

But a Government spokesman said: "There is no evidence that house prices have been affected in over half a century of oil and gas exploration in the UK or evidence that this would be the case with shale.

"This Government believes that shale has a positive part to play in our future energy mix, providing energy security, driving growth and creating jobs."

One of the campaigners super-glued to the building is Lindsay Alderton, 39, from Chester.

Speaking at the protest, she said it is "shameful" that the Government is "keeping secret the impacts of shale gas extraction", adding that the public "has a right to know".

She told Sky News: "Our aim is to get Defra to release the full unredacted report.

"It's the public's right to know this information.

"Censorship is not acceptable when it comes to fracking. It's our country. This is vital information."

Dominic Francis, 27, of Reclaim the Power, said: "This is part of a national day of action against fracking. We want to see investment in renewable, sustainable energy."

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Cameron Admits Policies Have 'Hurt Families'

All government policies will have to pass a "family test" under plans announced by David Cameron.

The Prime Minister used a speech to admit children and parents have often suffered as the result of legislation.

From October, Whitehall impact assessments for policies will have to formally consider their effects on families, alongside factors such as cost effectiveness and the environment.

Mr Cameron also unveiled figures that showed adoptions have increased by a quarter following efforts to improve the system - and a doubling of funding for relationship counselling through Relate, to £19.5m.

"I want every government department to be held to account for the impact of their policies on the family," the PM said.

"The reality is that in the past the family just hasn't been central to the way government thinks.

"So you get a whole load of policy decisions which take no account of the family and sometimes make these things worse.

"Whether it's the benefits system incentivising couples to live apart or penalising those who go out to work or whether it's excessive bureaucracy preventing loving couples from adopting children with no family at all.

"We can't go on having government taking decisions like this which ignore the impact on the family.

"I said previously that we would introduce a family test into government. Now that test is being formalised as part of the impact assessment for all domestic policies.

"Put simply, that means every single domestic policy that government comes up with will be examined for its impact on the family."

Education Minister Nick Boles told Sky News: "It basically will say if you have got a policy, you want to get it through, you have got to be able to demonstrate with evidence that this policy is going to be help families and not in any way do anything to undermine families, and that actually a very powerful tool in government to make sure all policies are furthering that goal."

Mr Cameron's speech comes as the Government prepares to launch an extension of its programme to tackle troubled families, set up by the Prime Minister following the 2011 riots across English cities.

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German Writers Join Amazon Ebook Protest

More than 1,000 German-language authors have signed a petition against the tactics used by Amazon in its ebook price battle with Scandinavian publishing house Bonnier.

"In the past few months, Bonnier authors are being boycotted and their books no longer held in stock," the letter, which included Austrian Nobel literature prize laureate Elfriede Jelinek, said.

"The delivery of the books is being subjected to a go-slow, false information is given about their availability, and the authors' names no longer appear on Amazon's recommended lists.

"Amazon has no right to take hostage authors who are not directly involved in the conflict."

America's fourth biggest publisher, Hachette, has already been struggling with Amazon.

Nearly 1,200 authors, including Stephen King, Malcolm Gladwell and Donna Tartt, had earlier signed a letter as Authors United demanding Amazon stop "taking writers hostage" to increase market share.

Amazon.com's Books Team ran a message on the Readers United website reiterating its arguments for cheaper ebooks, and suggested people email Hachette chief executive Michael Pietsch.

The company published Mr Pietsch's email address and listed key points people might want to make.

Days later the literary estate of 1984 author George Orwell accused Amazon of "doublespeak" after the online retailer invoked the famous author in its struggle over prices.

Literary executor Bill Hamilton said Amazon had twisted the novelist's words, and compared the company to the Ministry of Truth in Orwell's dystopian novel.

The US dispute has already widened from print to include Hollywood.

More than a week ago Amazon.com was not offering DVD pre-orders for forthcoming Disney films, including titles such as Maleficent and Captain America: The Winter Soldier.

The titles were, however, available on the UK website.

This followed on from the retailer's standoff with Warner Bros over movies in May, when it stopped pre-orders of the company's home video releases.

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UK Growth Hits Fastest Annual Pace Since 2007

The annual rate of UK economic growth has been revised upwards to 3.2% - its fastest pace since the end of 2007.

The announcement was made by the Office for National Statistics (ONS) as it confirmed GDP growth of 0.8% in the second quarter of the year.

While that figure represented no change on its original estimate, the ONS said it had measured a stronger performance in the construction sector than previously calculated in its wider revisions.

It confirmed that the service sector - which makes up more than 75% of GDP - remained the main driver of Britain's economy between April and June, expanding by 1%.

Much of this has been attributed to consumer spending despite huge pressure on budgets because of weak wage growth - a situation that had been tipped to ease during 2014 but has worsened again in recent months.

The ONS confirmed on Wednesday that wages shrank at an annual rate of 0.2% in the second quarter while the main measure of inflation rose to 1.9%, meaning the gap between wages and price rises was widening further.

The Bank of England has now made the weak pay issue a core factor in its discussions over the timing of an interest rate rise.

The UK's resilient GDP growth is in sharp contrast to economic fortunes in the euro area.

It was confirmed on Thursday that Germany's GDP was in decline and French growth was stagnating.

Chief UK economist at Citigroup, Michael Saunders, told Sky News he was not overly concerned that the woes being experienced by the country's biggest trading partners would damage the UK's recovery.

He said the suro had been "in economic terms, something of a zombie for a number of years now" and backed calls from France for the European Central Bank (ECB) to provide stimulus.

"The ECB will eventually get around to QE (quantitative easing) - five years too late - I think they're going to do it in the next couple of quarters and that will give some boost but it really is a sad story of multiple policy failures in the euro area," he said.

"Even if it gets a bit better I don't think it will get a lot better in the euro area."

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Wall Street Giants Swoop On Sub-Prime Lender

By Mark Kleinman, City Editor

Two giants of Wall Street are in advanced talks to acquire Kensington, one of the UK's biggest sub-prime mortgage lenders.

Sky News has learnt that divisions of Blackstone and TPG, the US-based private equity groups, are close to securing a takeover of Kensington, which is owned by the Anglo-South African financial services provider Investec.

The sale of Kensington has not yet been finalised and could yet fall apart, but insiders said a deal was likely to be announced this week.

If completed, it will involve the business being taken over by Blackstone's Tactical Opportunities unit and TPG's TSSP special situations and credit platform.

Blackstone are thought to have seen off three other bidders

The two firms are understood to see significant opportunities to grow Kensington's business and are expected to make substantial amounts of capital available for it to do so.

They are said to have lined up a new management team to take the helm once the deal completes.

Investec's £283m takeover of Kensington in the summer of 2007 proved to be an ill-timed foray into the market for sub-prime mortgage lending, coming just as financial markets began to seize up.

Kensington was previously a publicly-listed company whose former chief executives include John Maltby, who is now leading an investment consortium which is buying a stake in 315 Royal Bank of Scotland branches.

Investec, which is the main sponsor of the England cricket team, signalled its intention to sell Kensington in February.

Blackstone and TPG are understood to have seen off competition from at least three other bidders for the business, one of which was said to be Lonestar, a specialist US property investor.

"With the ongoing recovery in mortgage lending and wholesale funding markets we believe that Kensington is now well placed to continue growing and that this growth potential may be better realised under different ownership," Stephen Koseff, chief executive of Investec, said at the start of the auction process.

Analysts say the bank should recoup the majority of its initial outlay, with Kensington's recent performance aided by the strength of the UK housing market.

The auction of Kensington, which is being handled by Fenchurch Advisory, comes amid increasing signs of an overheating housing market in London and the south-east.

Some of the UK's biggest banks have imposed fresh limits on mortgage lending in the capital in recent months.

Blackstone, TPG and Investec declined to comment.

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Downloads Drop As Appetite For New Apps Wanes

Fears have been raised that downloading of smartphone apps has reached saturation point - because they are getting too good.

Researchers said almost a third of users do not download apps in a typical month.

The results raise concern for developers of mobile apps that the waning appetite for software will harm future programme creation.

"The UK is a bellwether for the mobile industry and and it is a mature market that is home to many top developers," Deloitte head of tech, media and telecoms Paul Lee told Sky News.

"Early adopters have bought their apps and most new smartphone users are older and not included to rush out and buy lots of apps."

According to the research, only around 10% of smartphone users buy apps or other content regularly.

Mr Lee said some 31% of global smartphone users do not download apps, a rise from around 20% at the same point last year.

And the average number of apps downloaded has fallen from 2.3 to 1.8 in the same period.

"People like to say they enjoy change but they don't, they prefer the path of least resistance," Mr Lee said.

"It's a Darwinian process. Ironically, existing apps are getting better with tweaks and so people feel less inclined to look for new apps."

Mr Lee's full report is due to be published on September 4 and the results raise potential problems for mobile media companies and games firms.

The maker of the popular mobile game Candy Crush has already learned about an apparent waning of consumer interest, seeing revenue drop by 8% in just three months.

Last week King Digital Media, which makes most of its money from just three games, saw its share price sink more than 25%, wiping almost £1bn from its value.

The sell-off occurred after it issued a profit warning alongside its second quarter results.

The London-based, New York-listed company went public on the stock market in March with shares priced at $22.50 (£13.45), and they are now trading at the lowest point since flotation - at around $13.50 (£8.05).

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Truells Eye Float Of Magazine Group Imagine

By Mark Kleinman, City Editor

Two of the City's most prominent siblings are plotting a flotation of Imagine Publishing, a magazine imprint whose titles include All About Space and Total 911, the Porsche enthusiasts' bible.

Sky News understands that Danny and Edi Truell, financiers who have engineered scores of deals during their careers, are lining up bankers from Canaccord Genuity to oversee a public listing of the specialist content publisher.

A flotation, which will take place on London's junior AIM market and is likely to be announced later this month, would represent the Truells' latest effort to raise capital to invest in a sector where some of its competitors are struggling.

Recent figures published by the Audit Bureau of Circulations showed that consumer magazines lost close to 1m print sales in the first half of the year as readers increasingly shift their consumption to digital platforms.

Imagine was set up in 2005 by a trio of former executives of major magazine publishers, before they sold a controlling stake to the brothers last year.

It aims to exploit growing demand for bespoke content, with readers able to order individually created digital magazines that reflect their personal interests.

Imagine publishes 20 print titles focused on four core areas: knowledge and science, photography, technology and video-games.

It also offers 50 digital apps and more than 250 bookazines under titles such as Piano for Beginners and The Professional PhotoShop Book.

The company is listed as a 'partner direct company' of Disruptive Capital Finance, the Truells' investment vehicle.

According to Imagine's website, it recorded sales of £19m last year and employs more than 150 people.

Danny Truell is the chief investment officer of the Wellcome Trust, the medical research charity, overseeing last month's acquisition of the Co-operative Group's agricultural interests.

Edi Truell, who will chair Imagine when it goes public, previously ran Duke Street Capital, the private equity firm, before founding the pension buyout group Pension Corporation.

He now chairs the London Pensions Fund Authority for the Mayor, Boris Johnson.

The brothers also sit on the board of Tungsten Corporation, which is now building a substantial presence in the e-invoicing market.

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Nationwide Profit Rockets In Housing Surge

High street lender Nationwide has seen underlying profit more than double in the three months to the end of June.

First quarter profit for the building society reached £263m, up 117% on the same period last year.

Statutory profit was up 141%, to £253m in the quarter.

The mutual said its share of current accounts - against the four big high street banks - rose slightly to 6.4% from 6.2%.

And while deposits increased by £1.5bn to £132bn, gross mortgage lending fell to 9%, to £5.8bn from £6.4bn.

The results come as Bovis Homes said its pre-tax profit for the first six months of the year were up 166%, to £49.4m, on the back of a record number of completions.

The company has focused its construction areas in the south of England in recent years and said the average sale price was around £212,500.

Bovis said it now expects to see a significant increase in 2014 full-year profit, provided stability remained in the market.

Meanwhile the brakes are increasingly being applied to sellers' asking prices, according to a property website.

Rightmove said the fear of increasing loan rates and the new mortgage affordability tests imposed on lenders in late April have squeezed expectations.

It said prices this month have fallen 2.9% month-on-month to an average of £262,401 across England and Wales.

It was the biggest August dip in more than a decade of recording asking price results.

Rightmove director Miles Shipside said: "New seller asking prices are good lead indicators of the current mood of the market.

"And those who have put their property up for sale in the last month are obviously aware that potential buyers are thinner on the ground at this time of year and need to be tempted to act by cheaper prices."

London was the biggest faller, seeing asking prices drop 5.9% to an average of £552,783 compared to July.

The capital's asking prices were still 10.3% higher than they were in the same period last year, it said.

Asking prices in the North saw the only increase month-on-month, up 0.5% to an average of £149,354.

In Wales, prices eased 2% month-on-month, to a typical value of £173,176.

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