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CHINA Merchants Securities increased its stake in Bosera Asset Management to 73 percent in a 6.32-billion-yuan (US$854 million) deal, Bosera said in a statement late on Wednesday. China Merchants paid 130 yuan per share to buy an additional 48 percent of Bosera from Kinghing Trust & Investment Co Ltd. With the deal, China Merchants also set a record for the biggest purchase of a stake in the fund industry. The previous record was set in October by Shanxi Haixin Group when it paid 1.18 billion yuan, or 56.20 yuan per share, to buy a 21-percent stake in Yinhua Fund Management Co Ltd. Kinghing Trust & Investment Co Ltd was shut down in 2006 for violating rules and bad management. The securities regulator announced it would auction Kinghing's shares in Bosera on November 19. "The move shows the ambition of China Merchants to expand and its confidence on the prospect of China's fund industry," said Zhang Qi, an analyst with Haitong Securities Co. "The share price for

JEFFREY Bewkes, who takes over as chief executive officer of Time Warner Inc next week, may be measured by how quickly he can dismantle the world's largest media company. Bewkes may spin off the cable-television division and sell the AOL Web and Time Inc magazine units, Gamco Investors Inc fund manager Chris Marangi and National City Bank analyst Daniel Poole told Bloomberg News. The remaining company, anchored by the film studio and cable TV networks, would resemble Viacom Inc and accordingly command higher multiples, Marangi said. Sumner Redstone's Viacom, owner of Paramount Pictures and MTV Networks, trades for nine times projected 2008 earnings before interest, taxes and non-cash expenses, Marangi said. Time Warner, whose assets include Warner Bros, CNN and HBO, trades at seven. "There's nothing special necessarily about being the biggest," Marangi said. Gamco, based in New York, has US$30 billion in assets, including 11.3 million Time Warner shares. "It's

DOMESTIC carriers are anxiously awaiting China Eastern Airlines' shareholder meeting on January 8, as the result will indicate the future direction of the aviation industry. China Eastern and Singapore Airlines have fallen in "bitter love" since they signed a cooperation deal last month. Under the terms of the deal, Singapore Airlines will spend HK$4.7 billion (US$602 million) to buy a 16-percent stake in China Eastern, and its parent Temasek Holdings Pte will buy an 8.3-percent stake for HK$2.5 billion at HK$3.80 a share. China Eastern's parent will buy 1.1 billion new shares for HK$4.18 billion to maintain a majority stake. However, the deal requires approval from minority shareholders, including Air China, once a bidder for China Eastern. Air China, the country's flagship international carrier, hasn't declared whether it will accept or veto the deal. Xia Fulu, analyst of Industrial Securities, said Air China dreams of becoming one of the top 10 carriers in the

CITIC International Financial Holdings Ltd, controlled by China's biggest state-owned investment company, said profit this year would match analysts' estimates even after setting aside provisions for structured investment vehicles. Net income "should be close to present analyst consensus opinions," the company said in a statement to the Hong Kong Stock Exchange late yesterday, without giving a figure. CITIC International is forecast to earn HK$1.84 billion (US$236 million) in 2007, according to the average of five analyst estimates compiled by Bloomberg News over the past month. CITIC International last month said it will borrow HK$2.5 billion to support wholly-owned banking unit CITIC Ka Wah Bank Ltd, which has suffered losses on SIV investments. Three SIVs held by CITIC Ka Wah have lost an average 43 percent of their value, and a fourth has fallen 34 percent, the release said. The bank has invested US$340 million in SIVs. "We are still very much worried about

VIVENDI'S SA's SFR phone unit has offered to buy the rest of Neuf Cegetel for 4.5 billion euros (US$6.5 billion) to challenge France Telecom SA in the market for combined fixed-line, Internet and mobile services. SFR, which owns 40.5 percent of Neuf, will pay 34.50 euros a share for the 29.5 percent stake held by Louis Dreyfus & Cie, the commodities firm that helped found Neuf a decade ago, Bloomberg News reported. SFR will bid 36.50 euros for the remaining shares in the market. The prices include the 2007 dividend. The acquisition of Neuf Cegetel, France's second-largest fixed-line phone company, adds 3.1 million high-speed Internet customers for SFR and more than 3 billion euros in annual revenue. SFR, Vivendi's largest business, has about 34 percent of the French mobile market, compared with France Telecom's 45 percent. "This would create a more formidable competitor," Jerry Bellman, analyst at Kepler Equities in Paris, said. "For SFR this is a defensive move,

CHINA Eastern Airlines Corp, the nation's third-largest carrier, said it is in talks to buy 40 Boeing Co 737 planes and has applied to the government for 40 Airbus SAS A320s to expand its fleet. The planned purchases may help expand the Shanghai-based carrier's fleet by 53 percent to 322 aircraft in 2010 from the current 210, Zhang Jing, a China Eastern spokeswoman, said yesterday, confirming a Reuters report. Singapore Airlines Ltd and parent Temasek Holdings Pte plan to buy a 24-percent stake in China Eastern for HK$7.16 billion (US$918 million), cutting the carrier's debt and easing its "most difficult" period, Chairman Li Fenghua said last week. The cash infusion may help the company pay for the planes to compete with Air China Ltd, according to Bloomberg News. "Carriers are queuing up to buy planes as demand grows," said Ma Ying, an analyst at Haitong Securities Co in Shanghai. "China Eastern's stake sale will enable it to afford the

INGERSOLL-RAND Co, the maker of Thermo King refrigerated trucks, has agreed to buy Trane Inc for US$10.1 billion in cash and stock to gain cooling systems for transportation and buildings. Ingersoll-Rand will pay US$36.50 in cash and 0.23 of a share for Trane, the Bermuda-based company said, according to Bloomberg News. That values the New Jersey-based air-conditioner maker's shares at US$47.81 based on Friday's closing price. Ingersoll-Rand will take on US$150 million of debt. Chief Executive Officer Herbert Henkel said the purchase of the air-conditioner maker will create a company with US$17 billion of sales, more than half coming from the heating and cooling business. Ingersoll-Rand this month completed the sale of its Bobcat construction-machinery unit, shifting its focus to refrigeration systems amid rising trade in frozen foods. "The market for transporting food is very strong," Sanjay Jha, a London-based analyst at Pali International, said in an interview.

RUPERT Murdoch may take until the end of 2010 to show he was right to pay US$5.2 billion for Dow Jones & Co., whose shareholders probably were to approve the takeover yesterday. By that time, Murdoch's News Corp should be able to double Dow Jones's pretax cash flow to US$600 million, giving it a 12-percent return on the purchase, said Larry Haverty, a fund manager at New York's Gamco Investors Inc, Bloomberg News reported. Dow Jones may start adding to News Corp's profit in 2009 following investments next year, said Laura Martin, an analyst at Soleil Securities in San Marino, California. "It's not a quick strategy," said Haverty, who helps manage Gamco's US$30 billion in assets, including US$308.1 million of News Corp shares as of September 30. "Where he's going, we're very comfortable with it. It's just going to take three years." More than 50 percent of shareholders approved the deal ahead of the meeting, the Wall Street Journal reported on Wednesday. The

GLAXOSMITHKLINE Plc is likely to delay marketing its troubled Avandia diabetes pill as an Alzheimer's disease treatment because patients are reluctant to volunteer for research studies. Glaxo, Europe's largest drug maker, has lost more than 33 percent of Avandia's US$3.3 billion in annual sales since a report in May tied the pill to heart attacks. Glaxo is trying to transform the drug into an Alzheimer's therapy after a preliminary study in 2005 suggested that Avandia may improve memory in some patients. Doctors who are running the new trials say the heart-risk concern has slowed patient recruitment. The Alzheimer's use may bring in US$300 million of the more than US$1 billion in lost annual revenue, according to London-based analyst Matthew Weston and colleagues at Lehman Brothers Holdings Inc. Of 35 analysts surveyed by Bloomberg News, 12 rate Glaxo a buy and 12 say it is a hold. "We're going to need an additional year," said Suzanne Craft, a researcher at the

INDITEX SA, Europe's largest clothing retailer, reported its smallest profit increase in four quarters after rising interest rates and a housing slump hurt spending at Zara stores in Spain. Net income rose 27 percent to 432 million euros (US$634 million) in the three months through October, calculations based on nine-month figures released yesterday by the Spain-based company show. That beat the 403-million-euro median estimate of 13 analysts surveyed by Bloomberg News. Sales rose 15 percent to 2.51 billion euros, the slowest rate in almost four years. "There is some disappointment on the top line," said Anne Critchlow, an analyst at Societe Generale who has a "hold" rating on the shares. The retailer has said most of a planned 280,000-square-meter expansion of its selling space this year will be outside Spain to reduce reliance on a market that still accounts for 40 percent of revenue. Inditex shares fell 3.15 euros, or 6.3 percent, to 46.60 euros at

EUGENE Corp, South Korea's biggest maker of ready-mixed concrete, will acquire Himart Co for 1.95 trillion won (US$2.1 billion) to expand into electronics retailing. The company, which also owns construction and logistics companies, will buy all 2.7 million shares of Himart from a group led by Affinity Equity Partners Ltd, according to a regulatory filing from Bucheon-based Eugene yesterday, Bloomberg News reported. The acquisition gives Eugene a 252-store nationwide sales and distribution network that it will use to start door-to-door sales, strengthening its logistics operations. Eugene, started in 1969 as Young-yang Confectionery Co, is seeking to build an industrial group by buying construction and logistics companies. "Eugene appears to have wanted Himart to complement its efforts to expand its logistics operations," said Kang Seung Min, an analyst at NH Investment & Securities Co in Seoul. "They had tried to buy a construction company but that didn't go

SHENZHEN Development Bank will sell shares to Shanghai Baosteel Group Corp to raise 4.22 billion yuan (US$571 million) to boost its capital. Baosteel, China's biggest steel maker, will buy 120 million shares at 35.15 yuan apiece and promised not to sell the shares until 36 months after the placement, the Shenzhen-based bank told Shenzhen Stock Exchange yesterday. Baosteel will hold 5.4 percent stake of the bank after the placement. The capital will be used to boost the lender's capital adequacy ratio, which stood at 4.27 percent at the end of September. It is the only Chinese listed bank whose capital adequacy ratio falls below the nation's eight percent threshold. This has kept the bank from boosting loan growth and expanding its network. "The move will act as a shot in the arm to the lender as capital fallout has been an obstacle curbing its growth in recent years," said Qiu Zhicheng, a Haitong Securities Co analyst. Haitong increased its rating on the bank from

CHINA Shipping Container Lines Co, Asia's second-largest container line, said yesterday it will beat its profit forecast after raising rates for shipments from Europe and carrying more cargo from the United States. Profit this year will be "significantly better" than the 3.18 billion yuan (US$430 million) previously expected, Chairman Li Shaode said in an interview in Shanghai last week, without giving a new figure. "Fewer empty boxes help cut costs on US routes." The company will earn 2.63 billion yuan, according to the average of nine analyst estimates compiled by Bloomberg News. Shipping lines are carrying more out of US ports this year as a 10.3 percent decline in the dollar against a basket of major world currencies cuts overseas prices for exporters including General Electric Co and Caterpillar Inc. China Shipping raised rates for shipments from Europe to Asia by US$500 a box on October 1, Li said.

SHENZHEN Development Bank will sell shares to Shanghai Baosteel Group Corp to raise 4.22 billion yuan (US$571 million). Baosteel, China's biggest steel maker, will buy 120 million shares at 35.15 yuan each and agreed not to sell the shares for 36 months after the placement, the Shenzhen-based bank said today in a statement to the Shenzhen Stock Exchange. Baosteel will hold a 5.4 percent stake in the bank after the placement. The money will be used to boost the lender's capital, which sat at 4.27 percent at the end of September. It is the only listed bank whose capital adequacy ratio falls below the regulator's threshold. The issue prevented the bank from boosting loan growth and expanding its network. ``The move will act as a shot in the arm to the lender as capital fallout has been an obstacle that has slowed its growth,'' said Qiu Zhicheng, a Haitong Securities Co analyst. Haitong increased its rating on the bank from "hold'' to "add.'' China Securities Co

BANK of Communications Ltd, part-owned by HSBC Holdings Plc, plans to cooperate overseas with the UK bank, the Chinese lender's Chairman Jiang Chaoliang said. BoCom, as the smallest of China's five major state-owned banks is known, seeks overseas acquisitions and branches, Jiang said at a conference in Beijing on Saturday. The Shanghai-based lender is one of the Chinese banks that are flush with cash after raising US$63 billion in the past two years by tapping the nation's surging stock market, Bloomberg News reported. BoCom in April raised US$3.3 billion in a Shanghai share sale. "It's a good time for Chinese banks to buy, with the yuan appreciating and the valuation of foreign banks being pushed down by subprime issues," said Ivan Li, an analyst with Kim Eng Securities in Hong Kong. He has a "buy" rating on BoCom shares. HSBC, Europe's biggest bank by market value, raised its ownership in BoCom to 19 percent from 18.6 after buying 172.5 million shares on

SINOTRUK (Hong Kong) Ltd, China's largest maker of heavy trucks, raised HK$9 billion (US$1.2 billion) in a Hong Kong initial public offering, said two people involved in the sale. Sinotruk sold 702 million new shares at HK$12.88 each, the top of the range marketed to investors, said the people, declining to be identified before an official statement. The sale of a 32-percent stake values the company, based in Ji'nan, Shandong Province, at US$3.6 billion, or 18.8 times next year's profit as estimated by the banks handling the sale, they said, according to Bloomberg News. The maker of Sitaier and Gold Prince trucks will use the funds raised to build new plants and improve technology as a construction boom boosts commercial vehicle sales in China. Heavy-truck sales rose 65 percent in the first 10 months of the year, according to Wang Mingcun, an analyst at TX Investment Consulting Co in Beijing. "China's economic growth and fixed-asset investments have boosted heavy-truck

EASYJET Plc, Europe's second-biggest discount airline, boosted second-half profit 34 percent as it trimmed costs, lured more business travelers and increased revenue from car rentals and priority boarding. Net income in the six months through September rose to 165 million pounds (US$340 million) from 123 million pounds a year earlier. Sales at the Luton, England-based firm advanced 8.9 percent to 1.08 billion pounds. Pretax profit will increase by about one-fifth this year, EasyJet said in a statement yesterday. Non-ticket revenue rose 29 percent in the second half and flights to airports close to city centers helped push the proportion of business travelers to 20 percent last month. The company cut expenses by brokering a new maintenance contract and buying planes to cut leasing costs as competition from Ryanair Holdings Plc put pressure on fares. "The numbers were good," said Gert Zonneveld, an analyst at Panmure Gordon in London. "I'm encouraged by the fact

VENTURE capital investment by Chinese-funded institutions surged 186.1 percent in the third quarter of this year from the previous quarter, with 38 contracts signed involving US$907.1 million, according to a recent report by ChinaVenture, a domestic financial consulting service provider. In the third quarter, Chinese-funded and foreign-funded venture capital investment altogether stood at US$1.1 billion nationwide, up 44.3 percent from the second quarter. The investment was spread over 109 deals, the report said. "Although the growth of Chinese-funded institutions in venture capital investment has gained momentum, they lack behind foreign competitors in terms of experience, scale of the funds and professionalism," Liu Liang, a senior analyst at ChinaVenture and one of the writers of the report, told Xinhua. The focus of the venture capitalists had shifted from high-tech industry to traditional industries, namely franchised business, education, manufacturing, media and

MERRILL Lynch & Co, the securities firm that ousted its chief executive officer less than a month ago, said it will pay incoming CEO John Thain at least US$44 million in bonus, salary and stock grants. Thain, who is giving up his post running the New York Stock Exchange, will receive an annual salary of US$750,000, a bonus this year of US$15 million and 500,000 restricted shares in Merrill worth US$28.1 million based on Friday's closing price, Bloomberg News reported. Thain will also receive 1.8 million options for Merrill shares, the New York-based brokerage said in a filing with the United States Securities and Exchange Commission. Merrill's former CEO Stan O'Neal was forced to resign on October 30 after the firm disclosed US$8.4 billion of writedowns on mortgage-related investments and bad loans. Deutsche Bank AG analyst Michael Mayo estimates the world's biggest brokerage may face another US$10 billion in losses. Thain, 52, was paid a total of US$9.4 million by NYSE in 2006,

AMR Corp's American Airlines, the world's largest carrier, and its US competitors are sitting on frequent-flier plans that may be worth as much as the airlines themselves. Demanding an upgrade on their investment, some shareholders want the programs sold. American's AAdvantage program, with more than 57 million members, may fetch as much as US$5.7 billion, according to a Morgan Stanley estimate. That's about the same as AMR's market value. Bear Stearns & Co projects United Airlines' Mileage Plus may go for as much as US$22.8 billion, more than four times the value of parent UAL Corp. Airlines could boost shares by 20 percent to 27 percent by unloading the units, analyst William J. Greene at Morgan Stanley in New York said in an October 15 report. Investors say selling the mileage plans would help reverse this year's 17- percent drop in airline stocks amid a 52-percent rise in jet-fuel prices. While airline executives have resisted giving up exclusive access to their best